Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Feb. 28, 2017 | Jun. 30, 2016 | |
Document And Entity Information | |||
Entity Registrant Name | PEOPLES FINANCIAL SERVICES CORP. | ||
Trading Symbol | pfis | ||
Entity Central Index Key | 1,056,943 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2016 | ||
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 | $ 289,406,757 | ||
Entity Common Stock, Shares Outstanding | 7,394,143 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Cash and due from banks: | ||
Cash and due from banks | $ 39,496 | $ 28,218 |
Interest-bearing deposits in other banks | 445 | 4,699 |
Total cash and due from banks | 39,941 | 32,917 |
Investment securities: | ||
Available-for-sale | 259,410 | 284,935 |
Held-to-maturity: Fair value December 31, 2016, $10,714; December 31, 2015, $12,606 | 10,517 | 12,109 |
Total investment securities | 269,927 | 297,044 |
Loans, net | 1,532,965 | 1,340,865 |
Less: allowance for loan losses | 15,961 | 12,975 |
Net loans | 1,517,004 | 1,327,890 |
Premises and equipment, net | 33,260 | 28,157 |
Accrued interest receivable | 6,228 | 5,796 |
Goodwill | 63,370 | 63,370 |
Intangible assets | 4,211 | 5,397 |
Other assets | 65,501 | 58,487 |
Total assets | 1,999,442 | 1,819,058 |
Deposits: | ||
Noninterest-bearing | 353,686 | 320,978 |
Interest-bearing | 1,235,071 | 1,134,832 |
Total deposits | 1,588,757 | 1,455,810 |
Short-term borrowings | 82,700 | 38,325 |
Long-term debt | 58,134 | 60,354 |
Accrued interest payable | 462 | 560 |
Other liabilities | 12,771 | 15,241 |
Total liabilities | 1,742,824 | 1,570,290 |
Stockholders' equity: | ||
Common stock, par value $2.00, authorized 25,000,000 shares, issued and outstanding 7,394,143 shares at December 31, 2016 and 7,410,606 shares at December 31, 2015 | 14,788 | 14,821 |
Capital surplus | 134,871 | 135,371 |
Retained earnings | 111,114 | 100,701 |
Accumulated other comprehensive loss | (4,155) | (2,125) |
Total stockholders' equity | 256,618 | 248,768 |
Total liabilities and stockholders' equity | $ 1,999,442 | $ 1,819,058 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position | ||
Held-to-maturity, Fair value | $ 10,714 | $ 12,606 |
Common stock, par value | $ 2 | $ 2 |
Common stock, shares authorized | 25,000,000 | 25,000,000 |
Common stock, shares issued | 7,394,143 | 7,410,606 |
Common stock, shares outstanding | 7,394,143 | 7,410,606 |
Consolidated Statements of Inco
Consolidated Statements of Income and Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Interest and fees on loans: | |||
Taxable | $ 59,902 | $ 54,004 | $ 54,316 |
Tax-exempt | 3,031 | 2,351 | 2,265 |
Interest and dividends on investment securities: | |||
Taxable | 2,515 | 3,207 | 3,946 |
Tax-exempt | 3,438 | 3,385 | 3,271 |
Dividends | 48 | 35 | 50 |
Interest on interest-bearing deposits in other banks | 50 | 49 | 38 |
Interest on federal funds sold | 10 | 70 | |
Total interest income | 68,984 | 63,041 | 63,956 |
Interest expense: | |||
Interest on deposits | 5,429 | 4,953 | 5,431 |
Interest on short-term borrowings | 402 | 53 | 71 |
Interest on long-term debt | 1,420 | 1,031 | 1,140 |
Total interest expense | 7,251 | 6,037 | 6,642 |
Net interest income | 61,733 | 57,004 | 57,314 |
Provision for loan losses | 5,000 | 3,700 | 3,524 |
Net interest income after provision for loan losses | 56,733 | 53,304 | 53,790 |
Noninterest income: | |||
Service charges, fees and commissions | 6,116 | 6,245 | 6,484 |
Merchant services income | 4,199 | 3,855 | 3,549 |
Commission and fees on fiduciary activities | 1,976 | 1,946 | 2,179 |
Wealth management income | 1,298 | 845 | 752 |
Mortgage banking income | 885 | 872 | 648 |
Life insurance investment income | 791 | 767 | 778 |
Net gain on sale of investment securities available-for-sale | 623 | 1,189 | 861 |
Total noninterest income | 15,888 | 15,719 | 15,251 |
Noninterest expense: | |||
Salaries and employee benefits expense | 22,434 | 21,533 | 20,652 |
Net occupancy and equipment expense | 9,422 | 9,104 | 8,102 |
Merchant services expense | 2,993 | 2,643 | 2,236 |
Amortization of intangible assets | 1,186 | 1,195 | 1,334 |
Acquisition related expense | 1,725 | ||
Other expenses | 11,995 | 12,304 | 11,884 |
Total noninterest expense | 48,030 | 46,779 | 45,933 |
Income before income taxes | 24,591 | 22,244 | 23,108 |
Income tax expense | 5,008 | 4,521 | 5,459 |
Net income | 19,583 | 17,723 | 17,649 |
Other comprehensive income (loss): | |||
Unrealized (loss) gain on investment securities available-for-sale | (3,417) | (510) | 4,343 |
Reclassification adjustment for net gain on sales included in net income | (623) | (1,189) | (861) |
Change in benefit plan liabilities | (917) | 296 | 3,684 |
Other comprehensive loss | (3,123) | (1,995) | (202) |
Income tax related to other comprehensive loss | (1,093) | (699) | (71) |
Other comprehensive (loss) income, net of income taxes | (2,030) | (1,296) | (131) |
Comprehensive income | $ 17,553 | $ 16,427 | $ 17,518 |
Net income: | |||
Basic | $ 2.65 | $ 2.36 | $ 2.34 |
Diluted | $ 2.65 | $ 2.36 | $ 2.34 |
Average common shares outstanding: | |||
Basic | 7,396,716 | 7,516,451 | 7,548,825 |
Diluted | 7,396,716 | 7,516,451 | 7,561,982 |
Dividends declared | $ 1.24 | $ 1.24 | $ 1.24 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands | Common Stock | Capital Surplus | Retained Earnings | Accumulated Other Comprehensive Loss | Treasury Stock | Total |
Balance at Dec. 31, 2013 | $ 15,614 | $ 146,109 | $ 84,008 | $ (698) | $ (6,241) | $ 238,792 |
Net income | 17,649 | 17,649 | ||||
Other comprehensive loss, net of income taxes | (131) | (131) | ||||
Dividends declared | (9,360) | (9,360) | ||||
Stock based compensation | 70 | 70 | ||||
Share retirement | (7) | (102) | (109) | |||
Reissuance under option plan | 10 | 11 | 21 | |||
Repurchase and retirement | (70) | (70) | ||||
Settlement of stock options | (83) | (83) | ||||
Retirement of treasury shares | (510) | (5,790) | $ 6,300 | |||
Balance at Dec. 31, 2014 | 15,097 | 140,214 | 92,297 | (829) | 246,779 | |
Net income | 17,723 | 17,723 | ||||
Other comprehensive loss, net of income taxes | (1,296) | (1,296) | ||||
Dividends declared | (9,319) | (9,319) | ||||
Stock based compensation | 69 | 69 | ||||
Share retirement | (276) | (4,912) | (5,188) | |||
Balance at Dec. 31, 2015 | 14,821 | 135,371 | 100,701 | (2,125) | 248,768 | |
Net income | 19,583 | 19,583 | ||||
Other comprehensive loss, net of income taxes | (2,030) | (2,030) | ||||
Dividends declared | (9,170) | (9,170) | ||||
Stock based compensation | 71 | 71 | ||||
Share retirement | (33) | (571) | (604) | |||
Balance at Dec. 31, 2016 | $ 14,788 | $ 134,871 | $ 111,114 | $ (4,155) | $ 256,618 |
Consolidated Statements of Cha6
Consolidated Statements of Changes in Stockholders' Equity (Parenthetical) - $ / shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Statement of Stockholders' Equity | |||
Dividends declared (in dollars per share) | $ 1.24 | $ 1.24 | $ 1.24 |
Share retired, shares | 16,463 | 137,752 | 3,386 |
Reissuance under option plan, shares | 600 | ||
Repurchase and retirement, shares | 1,800 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Cash flows from operating activities: | |||
Net income | $ 19,583 | $ 17,723 | $ 17,649 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation of premises and equipment | 1,661 | 1,595 | 1,671 |
Amortization of deferred loan costs | 786 | 603 | 289 |
Amortization of intangibles | 1,186 | 1,195 | 1,334 |
Amortization of loss on investment tax credits | 477 | 635 | 248 |
Provision for loan losses | 5,000 | 3,700 | 3,524 |
Net loss (gain) on sale of other real estate owned | 137 | (132) | (70) |
Net loss on disposal of equipment | 87 | 63 | |
Loans originated for sale | (26,708) | (25,246) | (11,376) |
Proceeds from sale of loans originated for sale | 27,593 | 29,604 | 10,295 |
Net gain on sale of loans originated for sale | (885) | (872) | (648) |
Net amortization of investment securities | 3,635 | 4,278 | 4,292 |
Net gain on sale of investment securities | (623) | (1,189) | (861) |
Life insurance investment income | (791) | (767) | (778) |
Deferred income tax expense | (1,442) | (841) | 1,146 |
Stock based compensation | 71 | 69 | 70 |
Net change in: | |||
Accrued interest receivable | (432) | (216) | 286 |
Other assets | 1,373 | (213) | (4,860) |
Accrued interest payable | (98) | (14) | (149) |
Other liabilities | (2,470) | (820) | 2,074 |
Net cash provided by operating activities | 28,053 | 29,179 | 24,199 |
Cash flows from investing activities: | |||
Proceeds from sales of investment securities available-for-sale | 27,408 | 81,983 | 15,389 |
Proceeds from repayments of investment securities: | |||
Available-for-sale | 53,128 | 58,318 | 47,149 |
Held-to-maturity | 1,561 | 2,520 | 2,576 |
Purchases of investment securities: | |||
Available-for-sale | (62,022) | (90,402) | (102,304) |
Net purchase redemption of restricted equity securities | (1,648) | (1,716) | 415 |
Net increase in lending activities | (195,408) | (133,146) | (35,996) |
Investment in low income housing investment tax credits | (2,045) | (3,050) | (1,366) |
Purchases of premises and equipment | (6,764) | (4,420) | (1,073) |
Proceeds from the sale of premises and equipment | 14 | 25 | |
Purchase of investment in life insurance | (1,500) | ||
Proceeds from sale of other real estate owned | 933 | 484 | 750 |
Net cash used in investing activities | (186,357) | (89,415) | (74,435) |
Cash flows from financing activities: | |||
Net increase in deposits | 132,947 | 30,252 | 46,051 |
Proceeds from long-term debt | 30,000 | ||
Repayment of long-term debt | (2,220) | (2,786) | (3,603) |
Net increase in short-term borrowings | 44,375 | 18,768 | (2,495) |
Retirement of common stock | (604) | (5,188) | (109) |
Net cash provided by financing activities | 165,328 | 61,727 | 30,352 |
Net (decrease) increase in cash and cash equivalents | 7,024 | 1,491 | (19,884) |
Cash and cash equivalents at beginning of year | 32,917 | 31,426 | 51,310 |
Cash and cash equivalents at end of year | 39,941 | 32,917 | 31,426 |
Cash paid during the period for: | |||
Interest | 7,349 | 6,788 | 6,791 |
Income taxes | 5,900 | 4,200 | 5,000 |
Noncash items: | |||
Transfers of loans to other real estate | $ 757 | $ 869 | 593 |
Retirement of treasury shares | $ 6,300 |
Summary of significant accounti
Summary of significant accounting policies | 12 Months Ended |
Dec. 31, 2016 | |
Summary of significant accounting policies | |
Summary of significant accounting policies | 1. Summary of significant accounting policies: Nature of operations: Peoples Financial Services Corp., a bank holding company incorporated under the laws of Pennsylvania, provides a full range of financial services through its wholly-owned subsidiary, Peoples Security Bank and Trust Company (“Peoples Bank”), including its subsidiary, Peoples Advisors, LLC (collectively, the “Company” or “Peoples”). On November 30, 2013, Penseco Financial Services Corporation, a financial holding company incorporated under the laws of Pennsylvania (“Penseco”), merged with and into Peoples Financial Services Corp., with Peoples Financial Services Corp. being the surviving corporation (the “Merger”), pursuant to an Agreement and Plan of Merger dated June 28, 2013 (the “Merger Agreement”). In connection with the Merger, on December 1, 2013, Penseco’s former banking subsidiary, Penn Security Bank and Trust Company, merged with and into Peoples Neighborhood Bank (the “Bank Merger”), and the resulting institution adopted the name Peoples Security Bank and Trust Company. The Company services its retail and commercial customers through twenty-five full-service community banking offices located within Lackawanna, Lehigh, Luzerne, Monroe, Montgomery, Susquehanna, Wayne and Wyoming Counties of Pennsylvania and Broome County of New York. Peoples Bank is a state-chartered bank and trust company under the jurisdiction of the Pennsylvania Department of Banking and Securities and the Federal Deposit Insurance Corporation. Peoples Bank’s primary product is loans to small- and medium-sized businesses. Other lending products include one-to-four family residential mortgages and consumer loans. Peoples Bank primarily funds its loans by offering open time deposits to commercial enterprises and individuals. Other deposit product offerings include certificates of deposits and various demand deposit accounts. Peoples Advisors, LLC, a member-managed limited liability company, provides investment advisory services through a third party to individuals and small businesses. Peoples Advisors, LLC did not meet the quantitative thresholds for required segment disclosure in conformity with accounting principles generally accepted in the United States of America (“GAAP”). Peoples Bank’s twenty-five community banking offices, all similar with respect to economic characteristics, share a majority of the following aggregation criteria: (i) products and services; (ii) operating processes; (iii) customer bases; (iv) delivery systems; and (v) regulatory oversight. Accordingly, they were aggregated into a single operating segment. The Company faces competition primarily from commercial banks, thrift institutions and credit unions within its market, many of which are substantially larger in terms of assets and capital. In addition, mutual funds and security brokers compete for various types of deposits, and consumer, mortgage, leasing and insurance companies compete for various types of loans and leases. Principal methods of competing for banking and permitted nonbanking services include price, nature of product, quality of service and convenience of location. The Company and Peoples Bank are subject to regulations of certain federal and state regulatory agencies and undergo periodic examinations. Basis of presentation: Under the acquisition method of accounting, in a business combination effected through an exchange of equity interests, consideration of the facts and circumstances surrounding a business combination that generally involve the relative ownership and control of the entity by each of the parties subsequent to the merger must be made in determining the acquirer for financial reporting purposes. Based on a review of these factors, the aforementioned merger between the Company and Penseco was accounted for as a reverse acquisition whereby Penseco was treated as the acquirer for accounting and reporting purposes. The consolidated financial statements of the Company have been prepared in conformity with GAAP, Regulation S-X and reporting practices applied in the banking industry. All significant intercompany balances and transactions have been eliminated in consolidation. The Company also presents herein condensed parent company only financial information regarding Peoples Financial Services Corp. (“Parent Company”). Prior period amounts are reclassified when necessary to conform with the current year’s presentation. Such reclassifications had no effect on financial position or results of operations. The Company has evaluated events and transactions occurring subsequent to the balance sheet date of December 31, 2016, for items that should potentially be recognized or disclosed in these consolidated financial statements. The evaluation was conducted through the date these consolidated financial statements were issued. Estimates: The preparation of consolidated financial statements in conformity with GAAP 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 consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates that are particularly susceptible to material change in the near term relate to the determination of the allowance for loan losses, fair value of financial instruments, the valuation of real estate acquired in connection with foreclosures or in satisfaction of loans, the valuation of deferred tax assets, determination of other-than-temporary impairment losses on securities and impairment of goodwill Actual results could differ from those estimates. Investment securities: Investments securities are classified and accounted for as either held-to-maturity, available-for-sale, or trading account securities based on management’s intent at the time of acquisition. Management is required to reassess the appropriateness of such classifications at each reporting date. The Company classifies debt securities as held-to maturity when management has the positive intent and ability to hold such securities to maturity. Held-to-maturity securities are stated at cost, adjusted for amortization of premium and accretion of discount. Investment securities are designated as available-for-sale when they are to be held for indefinite periods of time as management intends to use such securities to implement asset/liability strategies or to sell them in response to changes in interest rates, prepayment risk, liquidity requirements, or other circumstances identified by management. Available-for-sale securities are reported at fair value, with unrealized gains and losses, net of income taxes, excluded from earnings and reported in a separate component of stockholders’ equity. All marketable equity securities are accounted for at fair value. Estimated fair values for investment securities are based on quoted market prices from a national pricing service. Realized gains and losses are computed using the specific identification method and are included in noninterest income. Premiums are amortized and discounts are accreted using the interest method over the contractual lives of investment securities. Investment securities that are bought and held principally for the purpose of selling them in the near term, in order to generate profits from market appreciation, are classified as trading account securities. Trading account securities are carried at market value. Interest on trading account securities is included in interest income. Profits or losses on trading account securities are included in noninterest income. Transfers of securities between categories are recorded at fair value at the date of the transfer, with the accounting treatment of unrealized gains or losses determined by the category into which the security is transferred. Management evaluates each investment security to determine if a decline in fair value below its amortized cost is an other-than-temporary impairment (“OTTI”) at least quarterly, and more frequently when economic or market concerns warrant an evaluation. Factors considered in determining whether an other-than-temporary impairment was incurred include: (i) the length of time and the extent to which the fair value has been less than amortized cost; (ii) the financial condition and near-term prospects of the issuer; (iii) whether a decline in fair value is attributable to adverse conditions specifically related to the security or specific conditions in an industry or geographic area; (iv) the credit-worthiness of the issuer of the security; (v) whether dividend or interest payments have been reduced or have not been made; (vi) an adverse change in the remaining expected cash flows from the security such that the Company will not recover the amortized cost of the security; (vii) whether management intends to sell the security; and (viii) if it is more likely than not that management will be required to sell the security before recovery. If a decline is judged to be other-than-temporary, the individual security is written-down to fair value with the credit related component of the write-down included in earnings and the non-credit related component included in other comprehensive income or loss. The assessment of whether an other-than-temporary impairment exists involves a high degree of subjectivity and judgment and is based on information available to management at a point in time. Loans held for sale: Loans held for sale consist of one-to-four family residential mortgages originated and intended for sale in the secondary market. The loans are carried in aggregate at the lower of cost or estimated market value, based upon current delivery prices in the secondary mortgage market. Net unrealized losses are recognized through a valuation allowance by corresponding charges to income. Gains or losses on the sale of these loans are recognized in noninterest income at the time of sale using the specific identification method. Loan origination fees, net of certain direct loan origination costs, are included in net gains or losses upon the sale of the related mortgage loan. All loans are sold without recourse. Loans, net: Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are stated at their outstanding unpaid principal balances, net of deferred fees or costs. Interest income is accrued on the principal amount outstanding. Loan origination fees, net of certain direct origination costs, are deferred and recognized over the contractual life of the related loan as an adjustment to yield using the effective interest method. Premiums and discounts on purchased loans are amortized as adjustments to interest income using the effective interest method. Delinquency fees are recognized in income at the time when they are paid by customer. Transfers of financial assets, which include loan participation sales, are accounted for as sales, when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when: (i) the assets have been isolated from the Company; (ii) the transferee obtains the right, free of conditions that constrain it from taking advantage of that right, to pledge or exchange the transferred assets and (iii) the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity. The loan portfolio is segmented into commercial and retail loans. Commercial loans consist of commercial, commercial real estate, municipal and other related tax free loans. Retail loans consist of residential real estate and other consumer loans. The Company makes commercial loans for real estate development and other business purposes required by the customer base. The Company’s credit policies establish advance rates against the different forms of collateral that can be pledged against various commercial loans. Typically, the majority of loans will be underwritten to a percentage of their underlying collateral values such as real estate values, equipment, eligible accounts receivable and inventory. Individual loan advance rates may be higher or lower depending upon the financial strength of the borrower and/or term of the loan. Generally, assets financed through commercial loans are used for the operations of the business. Repayment for these types of loans generally comes from the cash flow of the business or the ongoing conversion of assets. Commercial real estate loans include construction, mini-perm, or longer term loans financing commercial properties. Repayment of these loans are generally dependent upon either the ongoing business cash flow from an owner occupied property or the lease/rental income or sale of a non-owner occupied property. Commercial real estate loans typically require a loan to value of not greater than 80% and vary in terms. Commercial and commercial real estate loans generally have higher credit risk compared to residential mortgage loans and consumer loans, as they typically involve larger loan balances concentrated with single borrowers or groups of borrowers. In addition, the payment expectations on loans secured by income-producing properties typically depend on the successful operations of the related business and thus may be subject to a greater extent to adverse conditions in the real estate market and in the general economy. Loans secured by commercial real estate generally have larger balances and involve a greater degree of risk than one-to-four family residential mortgage loans. Of primary concern in commercial real estate lending is the borrower’s and any guarantor’s creditworthiness and the feasibility and cash flow potential of the financed project. Additional considerations include: location, market and geographic concentration risks, loan to value, strength of guarantors and quality of tenants. Payments on loans secured by income properties often depend on successful operation and management of the properties. As a result, repayment of such loans may be subject to a higher level of risk than residential real estate loans, which could be caused by unfavorable conditions in the real estate market or the economy. To effectively monitor loans on income properties, we require borrowers and loan guarantors, if any, to provide annual financial statements on commercial real estate loans and rent rolls where applicable. In reaching a decision on whether to make a commercial real estate loan, we consider and review a cash flow analysis of the borrower and guarantor, when applicable. In addition, we evaluate business cash flows, if applicable, net operating income of the property, the borrower’s expertise, credit history and the value of the underlying property. We have generally required that the properties securing these real estate loans have debt service coverage ratios , which is net cash flow before debt service to debt service, of at least 1.2 times. An environmental report is obtained when the possibility exists that hazardous materials may have existed on the site, or the site may have been impacted by adjoining properties that handled hazardous materials. Commercial loans are generally made on the basis of a business entity or individual borrower’s ability to make repayment from business cash flows or individual borrowers’ employment and other income. Commercial business loans tend to have a slightly higher risk than commercial real estate loans because collateral usually consists of business assets versus real estate. Further, any collateral securing such loans may depreciate over time and could be difficult to appraise and liquidate. As a result, repayment of commercial business loans may depend substantially on the success of the business itself. Residential mortgages, including home equity loans, are secured by the borrower’s residential real estate in either a first or second lien position. Residential mortgages have varying loan rates depending on the financial condition of the borrower, loan to value ratio and term. Residential mortgages may have amortizations up to 30 years. Consumer loans include installment loans, car loans, and overdraft lines of credit. These loans are both secured and unsecured. Consumer loans may entail greater risk than do residential mortgage loans, particularly in the case of consumer loans that are unsecured. Repossessed collateral for a defaulted consumer loan may not provide an adequate source of repayment for the outstanding loan and a small remaining deficiency often does not warrant further substantial collection efforts against the borrower. Consumer loan collections depend on the borrower’s continuing financial stability, and therefore are likely to be adversely affected by various factors, including job loss, divorce, illness or personal bankruptcy. Furthermore, the application of various federal and state laws, including federal and state insolvency laws, may limit the amount that can be recovered on such loans. Off-balance sheet financial instruments: In the ordinary course of business, the Company has entered into off-balance sheet financial instruments consisting of commitments to extend credit, unused portions of lines of credit and standby letters of credit. These financial instruments are recorded in the consolidated financial statements when they are funded. Fees on commercial letters of credit and on unused available lines of credit are recorded as interest and fees on loans and are included in interest income when paid. The Company records an allowance for off-balance sheet credit losses, if deemed necessary, separately as a liability. Nonperforming assets: Nonperforming assets consist of nonperforming loans and other real estate owned. Nonperforming loans include nonaccrual loans, troubled debt restructured loans and accruing loans past due 90 days or more. Past due status is based on contractual terms of the loan. Generally, a loan is classified as nonaccrual when it is determined that the collection of all or a portion of interest or principal is doubtful or when a default of interest or principal has existed for 90 days or more, unless the loan is well secured and in the process of collection. When a loan is placed on nonaccrual, interest accruals discontinue and uncollected accrued interest is reversed against income in the current period. Interest collections after a loan has been placed on nonaccrual status are credited to a suspense account until either the loan is returned to performing status or charged-off. The interest accumulated in the suspense account is credited to income over the remaining life of the loan using the effective yield method if the nonaccrual loan is returned to performing status. However, if the nonaccrual loan is charged-off, the accumulated interest is applied as a reduction to principal at the time the loan is charged-off. A nonaccrual loan is returned to performing status when the loan is current as to principal and interest and has performed according to the contractual terms for a minimum of six months. Troubled debt restructured loans are loans with original terms, interest rate, or both, that have been modified as a result of a deterioration in the borrower’s financial condition and a concession has been granted that the Company would not otherwise consider. Unless on nonaccrual, interest income on these loans is recognized when earned, using the interest method. The Company offers a variety of modifications to borrowers that would be considered concessions. The modification categories offered can generally fall within the following categories: · Rate Modification — A modification in which the interest rate is changed to a below market rate. · Term Modification — A modification in which the maturity date, timing of payments or frequency of payments is changed. · Interest Only Modification — A modification in which the loan is converted to interest only payments for a period of time. · Payment Modification — A modification in which the dollar amount of the payment is changed, other than an interest only modification described above. · Combination Modification — Any other type of modification, including the use of multiple categories above. The Company segments 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. Loans are individually analyzed for credit risk by classifying them within the Company’s internal risk rating system. The Company’s risk rating classifications are defined as follows: · Pass — A loan to borrowers with acceptable credit quality and risk that is not adversely classified as Substandard, Doubtful, Loss nor designated as Special Mention. · Special Mention — A loan that has potential weaknesses that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or in the institution’s credit position at some future date. Special Mention loans are not adversely classified since they do not expose the Company to sufficient risk to warrant adverse classification. · Substandard — A loan that is inadequately protected by the current sound worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the bank will sustain some loss if the deficiencies are not corrected. · Doubtful — A loan classified as Doubtful has all the weaknesses inherent in one classified Substandard with the added characteristic that the weaknesses make the collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. · Loss — A loan classified as Loss is considered uncollectible and of such little value that its continuance as bankable loans is not warranted. This classification does not mean that the loan has absolutely no recovery or salvage value, but rather it is not practical or desirable to defer writing off this basically worthless asset even though partial recovery may be effected in the future. Other real estate owned is comprised of properties acquired through foreclosure proceedings or in-substance foreclosures. A loan is classified as in-substance foreclosure when the Company has taken possession of the collateral regardless of whether formal foreclosure proceedings take place. Other real estate owned is included in other assets and recorded at fair value less cost to sell at the time of acquisition, establishing a new cost basis. Any excess of the loan balance over the recorded value is charged to the allowance for loan losses. Subsequent declines in the recorded values of the properties prior to their disposal and costs to maintain the assets are included in other expenses. Any gain or loss realized upon disposal of other real estate owned is included in noninterest expense. Allowance for loan losses: The allowance for loan losses represents management’s estimate of losses inherent in the loan portfolio as of the balance sheet date. The allowance for loan losses account is maintained through a provision for loan losses charged to earnings. Loans, or portions of loans, determined to be confirmed losses are charged against the allowance account and subsequent recoveries, if any, are credited to the account. A loss is considered confirmed when information available at the financial statement date indicates the loan, or a portion thereof, is uncollectible. Nonaccrual, troubled debt restructured and loans deemed impaired at the time of acquisition are reviewed monthly to determine if carrying value reductions are warranted or if these classifications should be changed. Consumer loans are considered losses and charged-off when they are 120 days past due. Management evaluates the adequacy of the allowance for loan losses account quarterly. This assessment is based on past charge-off experience, known and inherent risks in the portfolio, adverse situations that may affect the borrower’s ability to repay, the estimated value of underlying collateral, composition of the loan portfolio, current economic conditions and other relevant factors. This evaluation is inherently subjective as it requires material estimates that may be susceptible to significant revision as more information becomes available. Regulators, in reviewing the loan portfolio as part of the scope of a regulatory examination, may require the Company to increase its allowance for loan losses or take other actions that would require the Company to increase its allowance for loan losses. The allowance for loan losses is maintained at a level believed to be adequate to absorb probable credit losses related to specifically identified loans, as well as probable incurred losses inherent in the remainder of the loan portfolio as of the balance sheet date. The allowance for loan losses consists of an allocated element and an unallocated element. The allocated element consists of a specific allowance for impaired loans individually evaluated under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 310, “Receivables,” and a formula portion for loss contingencies on those loans collectively evaluated under FASB ASC 450, “Contingencies.” A loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. All amounts due according to the contractual terms means that both the contractual interest and principal payments of a loan will be collected as scheduled in the loan agreement. Factors considered by management in determining impairment include payment status, ability to pay and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed. The Company recognizes interest income on impaired loans, including the recording of cash receipts, for nonaccrual, restructured loans or accruing loans depending on the status of the impaired loan. Loans considered impaired under FASB ASC 310 are measured for impairment based on the present value of expected future cash flows discounted at the loan’s effective interest rate or the fair value of the collateral if the loan is collateral dependent. If the present value of expected future cash flows discounted at the loan’s effective interest rate or the fair value of the collateral, if the loan is collateral dependent, is less than the recorded investment in the loan, a specific allowance for the loan will be established. The formula portion of the allowance for loan losses relates to large pools of smaller-balance homogeneous loans and those identified loans considered not individually impaired having similar characteristics as these loan pools. Loss contingencies for each of the major loan pools are determined by applying a total loss factor to the current balance outstanding for each individual pool. The total loss factor is comprised of a historical loss factor using a loss migration method plus qualitative factors, which adjusts the historical loss factor for changes in trends, conditions and other relevant factors that may affect repayment of the loans in these pools as of the evaluation date. Loss migration involves determining the percentage of each pool that is expected to ultimately result in loss based on historical loss experience. Historical loss factors are based on the ratio of net loans charged-off to loans, net, for each of the major groups of loans evaluated and measured for impairment under FASB ASC 450. The historical loss factor for each pool is a weighted average of the Company’s historical net charge-off ratio for the most recent rolling twelve quarters. Management adjusts these historical loss factors by qualitative factors that represents a number of environmental risks that may cause estimated credit losses associated with the current portfolio to differ from historical loss experience. These environmental risks include: (i) changes in lending policies and procedures including underwriting standards and collection, charge-off and recovery practices; (ii) changes in the composition and volume of the portfolio; (iii) changes in national, local and industry conditions, including the effects of such changes on the value of underlying collateral for collateral-dependent loans; (iv) changes in the volume and severity of classified loans, including past due, nonaccrual, troubled debt restructures and other loan modifications; (v) changes in the levels of, and trends in, charge-offs and recoveries; (vi) the existence and effect of any concentrations of credit and changes in the level of such concentrations; (vii) changes in the experience, ability and depth of lending management and other relevant staff; (viii) changes in the quality of the loan review system and the degree of oversight by the board of directors; and (ix) the effect of external factors such as competition and legal and regulatory requirements on the level of estimated credit losses in the current loan portfolio. Each environmental risk factor is assigned a value to reflect improving, stable or declining conditions based on management’s best judgment using relevant information available at the time of the evaluation. Adjustments to the factors are supported through documentation of changes in conditions in a narrative accompanying the allowance for loan loss calculation. The unallocated element is used to cover inherent losses that exist as of the evaluation date, but which have not been identified as part of the allocated allowance using the above impairment evaluation methodology due to limitations in the process. One such limitation is the imprecision of accurately estimating the impact current economic conditions will have on historical loss rates. Variations in the magnitude of impact may cause estimated credit losses associated with the current portfolio to differ from historical loss experience, resulting in an allowance that is higher or lower than the anticipated level. Management establishes the unallocated element of the allowance by considering a number of environmental risks similar to the ones used for determining the qualitative factors. Management continually monitors trends in historical and qualitative factors, including trends in the volume, composition and credit quality of the portfolio. The reasonableness of the unallocated element is evaluated through monitoring trends in its level to determine if changes from period to period are directionally consistent with changes in the loan portfolio. Management believes the level of the allowance for loan losses was adequate to absorb probable credit losses as of December 31, 2016. Premises and equipment, net: Land is stated at cost. Premises, equipment and leasehold improvements are stated at cost less accumulated depreciation and amortization. The cost of routine maintenance and repairs is expensed as incurred. The cost of major replacements, renewals and betterments is capitalized. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation and amortization are eliminated and any resulting gain or loss is reflected in noninterest income. Depreciation and amortization are computed principally using the straight-line method based on the following estimated useful lives of the related assets, or in the case of leasehold improvements, to the expected terms of the leases, if shorter: Premises and leasehold improvements 7 – 40 years Furniture, fixtures and equipment 3 – 10 years Business combinations, goodwill and other intangible assets, net: The Company accounts for its acquisitions using the purchase accounting method. Purchase accounting requires the total purchase price to be allocated to the estimat |
Cash and due from banks
Cash and due from banks | 12 Months Ended |
Dec. 31, 2016 | |
Cash and due from banks | |
Cash and due from banks | 2. Cash and due from banks: The Federal Reserve Act, as amended, imposes reserve requirements on all depository institutions. The Company’s required reserve balances were $23,800 and $19,128 at December 31, 2016 and 2015, respectively. |
Investment securities
Investment securities | 12 Months Ended |
Dec. 31, 2016 | |
Investment securities | |
Investment securities | 3. Investment securities: The amortized cost and fair value of investment securities aggregated by investment category at December 31, 2016 and 2015 are summarized as follows: Gross Gross Amortized Unrealized Unrealized Fair December 31, 2016 Cost Gains Losses Value Available-for-sale: U.S. Treasury securities $ $ $ U.S. Government-sponsored enterprises $ State and municipals: Taxable Tax-exempt Mortgage-backed securities: U.S. Government agencies U.S. Government-sponsored enterprises Total $ $ $ $ Held-to-maturity: Tax-exempt state and municipals $ $ $ $ Mortgage-backed securities: U.S. Government agencies U.S. Government-sponsored enterprises Total $ $ $ $ Gross Gross Amortized Unrealized Unrealized Fair December 31, 2015 Cost Gains Losses Value Available-for-sale: U.S. Treasury securities $ $ $ U.S. Government-sponsored enterprises $ State and municipals: Taxable Tax-exempt Mortgage-backed securities: U.S. Government agencies U.S. Government-sponsored enterprises Total $ $ $ $ Held-to-maturity: Tax-exempt state and municipals $ $ $ $ Mortgage-backed securities: U.S. Government agencies U.S. Government-sponsored enterprises Total $ $ $ $ The Company had net unrealized gains on available-for-sale securities of $359, net of deferred income taxes of $194 at December 31, 2016, and $2,985, net of deferred income taxes of $1,608, at December 31, 2015. Proceeds from the sale of investment securities available-for-sale amounted to $27,408 in 2016, $81,983 in 2015, and $15,389 in 2014. Gross gains of $623, $1,189, and $919 were realized on the sale of securities in 2016, 2015, and 2014, respectively. There were no gross losses in 2016 or 2015. Gross losses of $58 were realized on the sale of securities in 2014. The maturity distribution of the fair value, which is the net carrying amount, of the debt securities classified as available-for-sale at December 31, 2016, is summarized as follows: Fair December 31, 2016 Value Within one year $ After one but within five years After five but within ten years After ten years Mortgage-backed securities Total $ The maturity distribution of the amortized cost and fair value, of debt securities classified as held-to-maturity at December 31, 2016, is summarized as follows: Amortized Fair December 31, 2016 Cost Value Within one year After one but within five years After five but within ten years After ten years $ $ Mortgage-backed securities Total $ $ Securities with a carrying value of $144,750 and $180,478 at December 31, 2016 and 2015, respectively, were pledged to secure public deposits, repurchase agreements and certain other deposits as required or permitted by law. Securities and short-term investment activities are conducted with a diverse group of government entities, corporations and state and local municipalities. The counterparty’s creditworthiness and type of collateral is evaluated on a case-by-case basis. At December 31, 2016 and 2015, there were no significant concentrations of credit risk from any one issuer, with the exception of U.S. Government agencies and sponsored enterprises that exceeded 10.0 percent of stockholders’ equity. The fair value and gross unrealized losses of investment securities with unrealized losses for which an OTTI has not been recognized at December 31, 2016 and 2015, aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position, are summarized as follows: Less Than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized December 31, 2016 Value Losses Value Losses Value Losses U.S. Treasury securities $ $ $ $ U.S. Government-sponsored enterprises State and municipals: Taxable Tax-exempt $ $ Mortgage-backed securities: U.S. Government agencies U.S. Government-sponsored enterprises Total $ $ $ $ $ $ Less Than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized December 31, 2015 Value Losses Value Losses Value Losses U.S. Treasury securities $ $ $ $ U.S. Government-sponsored enterprises State and municipals: Taxable $ $ Tax-exempt Mortgage-backed securities: U.S. Government agencies U.S. Government-sponsored enterprises Total $ $ $ $ $ $ The Company had 163 investment securities, consisting of 107 tax-exempt state and municipal obligations, two U.S. Treasury securities, two taxable state and municipal obligations, 22 U.S. Government-sponsored enterprise securities and 30 mortgage-backed securities that were in unrealized loss positions at December 31, 2016. Of these securities, nine mortgage-backed securities and two tax-exempt state and municipal securities were in a continuous unrealized loss position for twelve months or more. Management does not consider the unrealized losses on the debt securities, as a result of changes in interest rates, to be OTTI based on historical evidence that indicates the cost of these securities is recoverable within a reasonable period of time in relation to normal cyclical changes in the market rates of interest. Moreover, because there has been no material change in the credit quality of the issuers or other events or circumstances that may cause a significant adverse impact on the fair value of these securities, and management does not intend to sell these securities and it is unlikely that the Company will be required to sell these securities before recovery of their amortized cost basis, which may be maturity, the Company does not consider the unrealized losses to be OTTI at December 31, 2016. The Company had 88 investment securities, consisting of 38 tax-exempt state and municipal obligations, one U.S. Treasury security, one taxable state and municipal obligation, twelve U.S. Government-sponsored enterprise securities, and 36 mortgage-backed securities that were in unrealized loss positions at December 31, 2015. Of these securities, seven mortgage-backed securities, four tax-exempt state and municipal securities and one taxable state and municipal obligation were in continuous unrealized loss positions for twelve months or more. There was no OTTI recognized for each of the years in the three-year period ended December 31, 2016. |
Loans, net and allowance for lo
Loans, net and allowance for loan losses | 12 Months Ended |
Dec. 31, 2016 | |
Loans, net and allowance for loan losses | |
Loans, net and allowance for loan losses | 4. Loans, net and allowance for loan losses: The major classifications of loans outstanding, net of deferred loan origination fees and costs at December 31, 2016 and 2015 are summarized as follows. Net deferred loan costs included in loan balances were $579 and $690 in 2016 and 2015, respectively. December 31 2016 2015 Commercial $ $ Real estate: Commercial Residential Consumer Total $ $ Loans outstanding to directors, executive officers, principal stockholders or to their affiliates totaled $15,614 and $10,187 at December 31, 2016 and 2015, respectively. Advances and repayments during 2016 totaled $7,862 and $2,435 respectively. There were no related party loans that were classified as nonaccrual, past due, or restructured at December 31, 2016 and 2015. At December 31, 2016, the majority of the Company’s loans were at least partially secured by real estate in the eastern Pennsylvania and southern tier New York counties that make up the market serviced by Peoples Security Bank & Trust Company. Therefore, a primary concentration of credit risk is directly related to the real estate market in this region. Changes in the general economy, local economy or in the real estate market could affect the ultimate collectability of this portion of the loan portfolio. Management does not believe there are any other significant concentrations of credit risk that could affect the loan portfolio. The changes in the allowance for loan losses account by major classification of loan for the year ended December 31, 2016, 2015, and 2014 were as follows: Real estate December 31, 2016 Commercial Commercial Residential Consumer Unallocated Total Allowance for loan losses: Beginning balance $ $ $ $ $ $ Charge-offs Recoveries Provisions Ending balance $ $ $ $ $ $ Ending balance: individually evaluated for impairment Ending balance: collectively evaluated for impairment Ending balance: loans acquired with deteriorated credit quality $ $ $ $ $ — Loans receivable: Ending balance $ $ $ $ $ $ Ending balance: individually evaluated for impairment Ending balance: collectively evaluated for impairment Ending balance: loans acquired with deteriorated credit quality $ $ $ $ $ $ Real estate December 31, 2015 Commercial Commercial Residential Consumer Unallocated Total Allowance for loan losses: Beginning balance $ $ $ $ $ $ Charge-offs Recoveries Provisions Ending balance $ $ $ $ $ $ Ending balance: individually evaluated for impairment Ending balance: collectively evaluated for impairment Ending balance: loans acquired with deteriorated credit quality $ $ $ $ $ Loans receivable: Ending balance $ $ $ $ $ $ Ending balance: individually evaluated for impairment Ending balance: collectively evaluated for impairment Ending balance: loans acquired with deteriorated credit quality $ $ $ $ $ Real estate December 31, 2014 Commercial Commercial Residential Consumer Unallocated Total Allowance for loan losses: Beginning balance $ $ $ $ $ $ Charge-offs Recoveries Provisions Ending balance $ $ $ $ $ $ Ending balance: individually evaluated for impairment Ending balance: collectively evaluated for impairment Ending balance: loans acquired with deteriorated credit quality $ $ $ $ $ $ Loans receivable: Ending balance $ $ $ $ $ $ Ending balance: individually evaluated for impairment Ending balance: collectively evaluated for impairment Ending balance: loans acquired with deteriorated credit quality $ $ $ $ $ $ The following tables present the major classification of loans summarized by the aggregate pass rating and the classified ratings of special mention, substandard and doubtful within the Company’s internal risk rating system at December 31, 2016 and 2015: Special December 31, 2016 Pass Mention Substandard Doubtful Total Commercial $ $ $ $ $ Real estate: Commercial Residential Consumer Total $ $ $ $ $ Special December 31, 2015 Pass Mention Substandard Doubtful Total Commercial $ $ $ $ $ Real estate: Commercial Residential Consumer Total $ $ $ $ $ Information concerning nonaccrual loans by major loan classification at December 31, 2016 and 2015 is summarized as follows: December 31, 2016 December 31, 2015 Commercial $ $ Real estate: Commercial Residential Consumer Total $ $ The major classification of loans by past due status at December 31, 2016 and 2015 are summarized as follows: Greater Loans > 90 30-59 Days 60-89 Days than 90 Total Past Days and December 31, 2016 Past Due Past Due Days Due Current Total Loans Accruing Commercial $ $ $ $ $ $ Real estate: Commercial Residential $ Consumer Total $ $ $ $ $ $ $ Greater Loans > 90 30-59 Days 60-89 Days than 90 Total Past Days and December 31, 2015 Past Due Past Due Days Due Current Total Loans Accruing Commercial $ $ $ $ $ $ Real estate: Commercial Residential $ Consumer Total $ $ $ $ $ $ $ The following tables summarize information concerning impaired loans as of and for the years ended December 31, 2016, 2015 and 2014 by major loan classification: For the Year Ended Unpaid Average Interest Recorded Principal Related Recorded Income December 31, 2016 Investment Balance Allowance Investment Recognized With no related allowance: Commercial $ $ $ $ Real estate: Commercial Residential Consumer Total With an allowance recorded: Commercial $ Real estate: Commercial Residential Consumer Total Commercial Real estate: Commercial Residential Consumer — Total $ $ $ $ $ For the Year Ended Unpaid Average Interest Recorded Principal Related Recorded Income December 31, 2015 Investment Balance Allowance Investment Recognized With no related allowance: Commercial $ $ $ $ Real estate: Commercial Residential Consumer Total With an allowance recorded: Commercial $ Real estate: Commercial Residential Consumer Total Commercial Real estate: Commercial Residential Consumer Total $ $ $ $ $ For the Year Ended Unpaid Average Interest Recorded Principal Related Recorded Income December 31, 2014 Investment Balance Allowance Investment Recognized With no related allowance: Commercial $ $ $ $ Real estate: Commercial Residential Consumer Total With an allowance recorded: Commercial $ $ Real estate: Commercial Residential Consumer Total Commercial Real estate: Commercial Residential Consumer Total $ $ $ $ $ There were no amounts of interest income recognized using the cash-basis method on impaired loans for the years ended December 31, 2016, 2015 and 2014. As a part of the Merger, an adjustment was made to reflect the elimination of the allowance for loan losses related to the Peoples Bank loan portfolio, as required by purchase accounting standards. As a result, the acquired loan portfolio was evaluated based on risk characteristics and other credit and market criteria to determine a credit quality adjustment to the fair value of the loan acquired. The acquired loan balance was reduced by the aggregate amount of the credit quality adjustment in determining the fair value of the loans. The credit quality adjustment does not account for acquired loans deemed to be impaired in accordance with Accounting Standard Codification 310-30-30, previously known as Statement of Position (SOP) 03-3, “Accounting for Certain Loans Acquired in a Transfer.” These impaired loans are accounted for in the credit adjustment on distressed loans, which represents the portion of the loan balance that has been deemed uncollectible based on the management’s expectations of future cash flows for each respective loan. Based on management’s evaluation of the acquired loan portfolio, 29 loans were deemed impaired resulting in a credit adjustment on distressed loans of $6,892. As of December 31, 2016, there were a total of ten loans remaining with a credit adjustment of $1,647. Management performed an evaluation of expected future cash flows, including the anticipated cash flow from the sale of collateral, and compared that to the carrying amount of the impaired loans. Based on these evaluations, the Company has determined that no additional reserve was required against the acquired impaired loans at December 31, 2016. The changes in the accretible yield of acquired loans accounted for under ASC310-30 for the years ended December 31, 2016, 2015 and 2014, were as follows: Year ended December 31 2016 2015 2014 Beginning Balance, January 1 $ $ $ Reclassification from Nonaccretible Accretion Charge-offs Payments Ending Balance, December 31 $ $ $ Included in the commercial loan and commercial real estate categories are troubled debt restructurings that were classified as impaired. Trouble debt restructurings totaled $1,909, $2,861 and $2,933 at December 31, 2016, 2015 and 2014, respectively. There were three loans modified in 2016, nine loans modified in 2015 and three loans modified in 2014 that resulted in troubled debt restructurings. The following tables summarize the loans whose terms have been modified resulting in troubled debt restructurings during the year ended December 31, 2016 and 2015. Pre-Modification Post-Modification Number Outstanding Recorded Outstanding Recorded December 31, 2016 of Contracts Investment Recorded Investment Investment Commercial $ $ $ Commercial real estate Residential mortgage Total $ $ $ Pre-Modification Post-Modification Number Outstanding Recorded Outstanding Recorded December 31, 2015 of Contracts Investment Recorded Investment Investment Commercial $ $ Commercial real estate $ Residential mortgage Total $ $ $ There was one payment default within 12 months of its modification on loans considered troubled debt restructurings for the year ended December 31, 2016 for $43, two payment defaults for the year ended December 31, 2015 totaling $166 and no defaults for the year ended December 31, 2014. The amount of loans in the formal process of foreclosure totaled $1,529 at December 31, 2016 and $564 at December 31, 2015. |
Off-balance sheet financial ins
Off-balance sheet financial instruments | 12 Months Ended |
Dec. 31, 2016 | |
Off-balance sheet financial instruments | |
Off-balance sheet financial instruments | 5. Off-balance sheet financial instruments: The Company is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit, unused portions of lines of credit and standby letters of credit. Those instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the consolidated balance sheets. The Company’s exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to extend credit, unused portions of lines of credit and standby letters of credit is represented by the contractual amounts of those instruments. The Company follows the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments. We record a valuation allowance for off-balance sheet credit losses, if deemed necessary, separately as a liability. An allowance of $58 and $47 was recorded as of December 31, 2016 and 2015, respectively. The contractual amounts of off-balance sheet commitments at December 31, 2016 and 2015 are summarized as follows: December 31 2016 2015 Commitments to extend credit $ $ Unused portions of lines of credit Standby letters of credit $ $ Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. The Company evaluates each customer’s credit worthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Company upon extension of credit, is based on management’s credit evaluation. Collateral held varies but may include personal or commercial real estate, accounts receivable, inventory and equipment. Unused portions of lines of credit, including home equity and overdraft protection agreements, are commitments for possible future extensions of credit to existing customers. Unused portions of home equity lines are collateralized and generally have fixed expiration dates. Overdraft protection agreements are uncollateralized and usually do not carry specific maturity dates. Unused portions of lines of credit ultimately may not be drawn upon to the total extent to which the Company is committed. Standby letters of credit are conditional commitments issued by the Company to guarantee the performance of a customer to a third party. Generally, all standby letters of credit expire within twelve months. The credit risk involved in issuing standby letters of credit is essentially the same as that involved in extending other loan commitments. The Company requires collateral supporting these standby letters of credit as deemed necessary. Collateral supporting standby letters of credit amounted to $27,072 at December 31, 2016 and $20,211 at December 31, 2015. The carrying value of the liability for the Company’s obligations under guarantees for standby letters of credit was not material at December 31, 2016 and 2015. |
Premises and equipment, net
Premises and equipment, net | 12 Months Ended |
Dec. 31, 2016 | |
Premises and equipment, net | |
Premises and equipment, net | 6. Premises and equipment, net: Premises and equipment at December 31, 2016 and 2015 are summarized as follows: December 31 2016 2015 Land $ $ Premises and leasehold improvements Furniture, fixtures and equipment Less: accumulated depreciation $ $ Depreciation and amortization included to noninterest expense amounted to $1,661, $1,595, and $1,671 in 2016, 2015 and 2014, respectively. Pursuant to the terms of non-cancelable lease agreements in effect at December 31, 2016, pertaining to banking premises and equipment, future minimum annual rent commitments under various operating leases are summarized as follows: 2017 $ 2018 2019 2020 2021 Thereafter $ The leases contain options to extend for periods from one to ten years. The cost of such options is not included in the annual rental commitments. Rent expense for the years ended December 31, 2016, 2015 and 2014 amounted to $416, $397 and $343, respectively. |
Intangible assets, net
Intangible assets, net | 12 Months Ended |
Dec. 31, 2016 | |
Intangible assets, net | |
Intangible assets, net | 7. Intangible assets, net: The gross carrying amount of core deposit intangible assets totaled $8,146 at December 31, 2016 and 2015. The gross carrying amount of trade name intangible assets totaled $203 at December 31, 2016 and 2015. The gross carrying amount of the intangible asset related to the acquisition of an asset management and retirement plan services company acquired in 2015 totaled $1,091 at December 31, 2016 and 2015. The accumulated amortization on core deposit intangible assets was $4,958 and $3,957 at December 31, 2016 and 2015, respectively. The accumulated amortization on trade name intangible assets was $102 and $73 at December 31, 2016 and 2015, respectively. The accumulated amortization on the asset management and retirement plan services intangible asset was $169 and $13 at December 31, 2016 and 2015, respectively. Amortization expense amounted to $1,186, $1,195 and $1,334 in 2016, 2015 and 2014, respectively. The estimated amortization expense on intangible assets in years subsequent to December 31, 2016, is as follows: 2017 $ 2018 2019 2020 2021 Thereafter $ |
Other assets
Other assets | 12 Months Ended |
Dec. 31, 2016 | |
Other assets. | |
Other assets | 8. Other assets: The major components of other assets at December 31, 2016 and 2015 are summarized as follows: December 31, 2016 December 31, 2015 Other real estate owned $ $ Investment in residential housing program Mortgage servicing rights Bank owned life insurance Restricted equity securities Other assets Total $ $ The Company originates one-to-four family residential mortgage loans for sale in the secondary market with servicing rights retained. Mortgage loans serviced for other are not included in the accompanying Consolidated Balance Sheets. The unpaid principal balances of mortgage loans serviced for others were $171,034 at December 31, 2016 and $168,198 at December 31, 2015. |
Deposits
Deposits | 12 Months Ended |
Dec. 31, 2016 | |
Deposits. | |
Deposits | 9. Deposits: The major components of interest-bearing and noninterest-bearing deposits at December 31, 2016 and 2015 are summarized as follows: December 31 2016 2015 Interest-bearing deposits: Money market accounts $ $ Now accounts Savings accounts Time deposits less than $250 Time deposits $250 or more Total interest-bearing deposits Noninterest-bearing deposits Total deposits $ $ The aggregate amounts of maturities for all time deposits at December 31, 2016, are summarized as follows: 2017 $ 2018 2019 2020 2021 Thereafter $ The aggregate amount of deposits reclassified as loans was $194 at December 31, 2016, and $187 at December 31, 2015. Management evaluates transaction accounts that are overdrawn for collectability as part of its evaluation for credit losses. |
Short-term borrowings
Short-term borrowings | 12 Months Ended |
Dec. 31, 2016 | |
Short-term borrowings | |
Short-term borrowings | 10. Short-term borrowings: Securities sold under agreements to repurchase and FHLB advances generally represent overnight or less than 30-day borrowings. Short-term borrowings consisted of the following at December 31, 2016 and 2015: At and for the year ended December 31, 2016 Weighted Weighted Maximum Average Average Ending Average Month-End Rate for Rate at End Balance Balance Balance the Year of the Year Repurchase agreements FHLB advances $ $ $ % % $ $ $ % % At and for the year ended December 31, 2015 Weighted Weighted Maximum Average Average Ending Average Month-End Rate for Rate at End Balance Balance Balance the Year of the Year Repurchase agreements $ % FHLB advances $ $ $ % $ $ $ % % Peoples Bank has an agreement with the FHLB-Pittsburgh which allows for borrowings up to its maximum borrowing capacity based on a percentage of qualifying collateral assets. At December 31, 2016, Peoples Bank’s maximum borrowing capacity was $599,435 of which $140,826 was outstanding in borrowings. Advances with the FHLB-Pittsburgh are secured under terms of a blanket collateral agreement by a pledge of FHLB stock and certain other qualifying collateral, such as investments and mortgage-backed securities and mortgage loans. Interest accrues daily on the FHLB advances based on rates of the FHLB discount notes. This rate resets each day. Securities sold under repurchase agreements are retained under Peoples Bank’s control at its safekeeping agent. The Bank may be required to provide additional collateral based on the fair value of the underlying securities. |
Long-term debt
Long-term debt | 12 Months Ended |
Dec. 31, 2016 | |
Long-term debt. | |
Long-term debt | 11. Long-term debt: Long-term debt consisting of advances from the FHLB at December 31, 2016 and 2015 are as follows: Interest Rate Due Fixed Adjustable 2016 2015 February 2016 % $ February 2016 February 2017 September 2017 April 2018 December 2018 December 2019 % December 2019 December 2019 June 2020 December 2020 March 2023 $ $ Maturities of long-term debt, by contractual maturity, in years subsequent to December 31, 2016 are as follows: 2017 $ 2018 2019 2020 2021 Thereafter $ None of the advances from the FHLB are convertible. At December 31, 2016, long-term debt consist of $48,834 at fixed rates and $9,300 at adjustable rates which reset quarterly based on three-month Libor plus 1.21% to plus 1.57%. |
Fair value of financial instrum
Fair value of financial instruments | 12 Months Ended |
Dec. 31, 2016 | |
Fair value of financial instruments | |
Fair value of financial instruments | 12. Fair value of financial instruments: Assets and liabilities measured at fair value on a recurring basis at December 31, 2016 and 2015 are summarized as follows: Fair Value Measurement Using Quoted Prices in Significant Significant Active Markets for Other Observable Unobservable Identical Assets Inputs Inputs December 31, 2016 Amount (Level 1) (Level 2) (Level 3) U.S. Treasury securities $ $ U.S. Government-sponsored enterprises $ $ State and Municipals: Taxable Tax-exempt Mortgage-backed securities: U.S. Government agencies U.S. Government-sponsored enterprises Total $ $ $ $ Fair Value Measurement Using Quoted Prices in Significant Significant Active Markets for Other Observable Unobservable Identical Assets Inputs Inputs December 31, 2015 Amount (Level 1) (Level 2) (Level 3) U.S. Treasury securities $ $ $ U.S. Government-sponsored enterprises $ State and Municipals: Taxable Tax-exempt Mortgage-backed securities: U.S. Government agencies U.S. Government-sponsored enterprises Total $ $ $ $ Assets and liabilities measured at fair value on a nonrecurring basis at December 31, 2016 and 2015 are summarized as follows: Fair Value Measurement Using Quoted Prices in Significant Significant Active Markets for Other Observable Unobservable Identical Assets Inputs Inputs December 31, 2016 Amount (Level 1) (Level 2) (Level 3) Impaired loans $ $ Other real estate owned $ $ Fair Value Measurement Using Quoted Prices in Significant Other Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs December 31, 2015 Amount (Level 1) (Level 2) (Level 3) Impaired loans $ $ Other real estate owned $ $ The following table presents additional quantitative information about assets measured at fair value on a nonrecurring basis and for which the Company has utilized Level 3 inputs to determine fair value: Quantitative Information about Level 3 Fair Value Measurements Fair Value Range December 31, 2016 Estimate Valuation Techniques Unobservable Input (Weighted Average) Impaired loans $ Appraisal of collateral Appraisal adjustments 18.0% to 97.0% (74.5)% Liquidation expenses 3.0% to 6.0% (5.3)% Other real estate owned $ Appraisal of collateral Appraisal adjustments 25.0% to 54.6% (43.1)% Liquidation expenses 3.0% to 6.0% (5.0)% Quantitative Information about Level 3 Fair Value Measurements Fair Value Range December 31, 2015 Estimate Valuation Techniques Unobservable Input (Weighted Average) Impaired loans $ Appraisal of collateral Appraisal adjustments 3.3% to 97.0% (61.7)% Liquidation expenses 3.0% to 6.0% (5.4)% Other real estate owned $ Appraisal of collateral Appraisal adjustments 20.0% to 77.3% (30.3)% Liquidation expenses 3.0% to 6.0% (5.0)% Fair value is generally determined through independent appraisals of the underlying collateral, which generally include various Level 3 Inputs which are not identifiable. Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated liquidation expenses. The range and weighted average of liquidation expenses and other appraisal adjustments are presented as a percent of the appraisal. The carrying and fair values of the Company’s financial instruments at December 31, 2016 and 2015 and their placement within the fair value hierarchy are as follows: Fair Value Hierarchy Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable Carrying Fair Assets Inputs Inputs December 31, 2016 Value Value (level 1) (level 2) (Level 3) Financial assets: Cash and cash equivalents $ $ $ Investment securities: Available-for-sale $ Held-to-maturity Loans held for sale Net loans $ Accrued interest receivable Mortgage servicing rights Restricted equity securities Total $ $ Financial liabilities: Deposits $ $ Short-term borrowings Long-term debt Accrued interest payable $ Total $ $ Fair Value Hierarchy Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable Carrying Fair Assets Inputs Inputs December 31, 2015 Value Value (level 1) (level 2) (Level 3) Financial assets: Cash and cash equivalents $ $ $ Investment securities: Available-for-sale $ $ Held-to-maturity Loans held for sale Net loans $ Accrued interest receivable Mortgage servicing rights Restricted equity securities Total $ $ Financial liabilities: Deposits $ $ Short-term borrowings Long-term debt Accrued interest payable $ Total $ $ |
Stock plans
Stock plans | 12 Months Ended |
Dec. 31, 2016 | |
Stock plans | |
Stock plans | 13. Stock plans: The 2008 long-term incentive plan (“2008 Plan”) allows for eligible participants to be granted equity awards. The plan was a legacy plan of Penseco Financial Services Corporation. Under the 2008 Plan the Compensation Committee of the board of directors has broad authority with respect to awards granted under the 2008 Plan, including, without limitation, the authority to: · Designate the individuals eligible to receive awards under the 2008 Plan. · Determine the size, type and date of grant for individual awards, provided that awards approved by the Committee are not effective unless and until ratified by the board of directors. · Interpret the 2008 Plan and award agreements issued with respect to individual participants. Persons eligible to receive awards under the 2008 Plan include directors, officers, employees, consultants and other service providers of the Company and its subsidiaries, except that incentive stock option may be granted only to individuals who are employees on the date of grant. There are 129,207 shares of the Company’s common stock available for grant as awards pursuant to the 2008 Plan. The 2008 Plan authorizes grants of stock options, stock appreciation rights, dividend equivalents, performance awards, restricted stock and restricted stock units. No restricted stock grants were awarded in 2016 and 2015. The activity related to restricted stock for each of the years ended December 31, 2016, 2015 and 2014 was as follows: Year Ended December 31 2016 2015 2014 Nonvested, January 1 Granted shares Vested shares Forfeited shares Nonvested, December 31 The Company expenses the fair value of all-share based compensation over the requisite service period of five years commencing at grant date. The fair value of restricted stock is expensed on a straight-line basis. Restricted stock granted to officers cliff vest after five years. The Company classifies share-based compensation for employees within “salaries and employee benefits expense” on the Consolidated Statements of Income and Comprehensive Income. The Company recognized $71, $69 and $70 of compensation expense for the years ended December 31, 2016, 2015 and 2014, respectively for stock awards granted in the years ended December 31, 2013 and 2012. As of December 31, 2016, the Company had $37 of unrecognized compensation expense associated with restricted stock awards. |
Employee benefit plans
Employee benefit plans | 12 Months Ended |
Dec. 31, 2016 | |
Employee benefit plans | |
Employee benefit plans | 14. Employee benefit plans: The Company had separate Employee Stock Ownership Plans (“ESOP”) and Retirement Profit Sharing 401(k) Plans for Penn Security Bank and Trust and Peoples Neighborhood Bank prior to 2014. The plans were merged at year end 2014 into the Peoples Security Bank and Trust Employee Stock Ownership Plan and the Peoples Security Bank and Trust Retirement Profit Sharing Plan. The Company also maintains Supplemental Executive Retirement Plans (“SERP”), and an Employees’ Pension Plan, which is currently frozen. Under the Peoples Security Bank and Trust Company ESOP, amounts voted by the Company’s Board of Directors are paid into the ESOP and each employee is credited with a share in proportion to their annual compensation. All contributions to the ESOP are invested in or will be invested primarily in Company stock. Distribution of a participant’s ESOP account occurs upon retirement, death or termination in accordance with the plan provisions. Under the Peoples Security Bank and Trust Company Retirement Profit Sharing Plan, amounts approved by the Board of Directors have been paid into a fund and each employee was credited with a share in proportion to their annual compensation. Upon retirement, death or termination, each employee is paid the total amount of their credits in the fund in one of a number of optional ways in accordance with the plan provisions. Eligible employees may elect deferrals of up to the maximum amounts permitted by law. The Company contributed $156, $144 and $294 to the Peoples Security Bank and Trust Company Employee Stock Ownership Plan in 2016, 2015 and 2014. In addition, the Company contribution of $786, $778 and $872 to the Peoples Security Bank and Trust Company Retirement Profit Sharing Plan in 2016, 2015 and 2014, comprised of a Safe Harbor contribution of $446, $430 and $464 and a discretionary match of $340, $348 and $408. Peoples Security Bank and Trust Company established a Supplemental Executive Defined Contribution Plan to replace 401(k) plan benefits lost due to compensation limits imposed on qualified plans by Federal tax law. The annual benefit is a maximum of 6% of the executive compensation in excess of Federal limits. The total liability associated with this plan was $76 and $63 at December 31, 2016 and 2015, respectively. The expense associated with the plan was $13, $15 and $5 for 2016, 2015 and 2014 respectively. The Company has SERPs for the benefit of certain officers of the Company. At December 31, 2016 and 2015, other liabilities include $ 1,416 and $ 1,244 accrued under the Plans. Compensation expense includes approximately $254, $157, and $176 relating to these SERPS for the years ended December 31, 2016, 2015 and 2014, respectively. Under the Penn Security Bank and Trust Company Employees’ Pension Plan, currently under curtailment, amounts computed on an actuarial basis were being paid by the Company into a trust fund. The plan provided for fixed benefits payable for life upon retirement at the age of 65, based on length of service and compensation levels as defined in the plan. As of June 22, 2008 no further benefits are being accrued in this plan. Plan assets of the trust fund are invested and administered by the Trust Department of Peoples Security Bank and Trust Company. Information related to the pension plan is as follows: Pension Benefits December 31 2016 2015 Change in benefit obligation: Benefit obligation, beginning $ $ Interest cost Change in experience gain Change in assumptions gain Benefits paid Benefit obligation, ending Change in plan assets: Fair value of plan assets, beginning Actual return on plan assets Employer contributions Benefits paid Fair value of plan assets, ending Funded status at end of year $ $ The Society of Actuaries released new mortality tables in 2016 and 2015 which the Company utilized in its pension plan remeasurements at December 31, 2016 and 2015. The change in mortality assumption resulted in a decrease to the pension plan’s accumulated benefit obligation of $256 in 2016 and a decrease of $352 in 2015. Amounts recognized in the consolidated balance sheets are as follows: Pension Benefits December 31 2016 2015 Liabilities $ $ Amounts recognized in the accumulated other comprehensive loss consist of: Net actuarial gain Deferred taxes Net amount recognized $ $ The accumulated benefit obligation for the defined benefit pension plan was $16,703 and $17,380 at December 31, 2016 and 2015, respectively. Components of net periodic pension income and other amounts recognized in other comprehensive income are as follows: Pension Benefits Years Ended December 31, 2016 2015 2014 Net periodic pension income: Interest cost $ $ $ Expected return on plan assets Amortization of unrecognized net loss Net periodic pension income: Other changes in plan assets and benefit obligations recognized in other comprehensive income (loss): Net loss (gain) Deferred tax Total recognized in other comprehensive income Total recognized in net period pension cost and other comprehensive income $ $ $ The estimated net loss for the defined benefit pension plan that will be amortized from accumulated other comprehensive loss into net periodic benefit cost over the next fiscal year is $195. Weighted-average assumptions used to determine benefit obligations and related expenses were as follows: Pension Benefits December 31, Discount rate: Obligation % % % Expense Expected long-term return on plan assets % % % The expected long-term return on plan assets was determined using average historical returns of the Company’s plan assets. The Company’s pension plan weighted-average asset allocations at December 31, 2016 and 2015, by asset category are as follows: December 31, 2016 2015 Asset Category: Cash and cash equivalents % % Equity securities Corporate bonds U.S. Government securities % % Fair Value Measurement of pension plan assets at December 31, 2016 and 2015 is as follows: Quoted Prices in Active Markets Significant Significant for Identical Observable Observable Assets Inputs Inputs December 31, 2016 Total (Level 1) (Level 2) (Level 3) Cash $ $ $ Equity securities: U.S. large cap International Fixed income securities: U.S. Treasuries $ U.S. Government agencies Corporate bonds Total $ $ $ $ Quoted Prices in Active Markets Significant Significant for Identical Observable Observable Assets Inputs Inputs December 31, 2015 Total (Level 1) (Level 2) (Level 3) Cash $ $ $ Equity securities: U.S. large cap International Fixed income securities: U.S. Treasuries $ U.S. Government agencies Corporate bonds Total $ $ $ $ The Company investment policies and strategies with respect to the pension plan include: (i) the Trust and Investment Division’s equity philosophy is Large-Cap Core with a value bias. We invest in individual high-grade common stocks that are selected from our approved list; (ii) diversification is maintained by having no more than 20% in any industry sector and no individual equity representing more than 10% of the portfolio; and (iii) the fixed income style is conservative but also responsive to the various needs of our individual clients. Fixed income securities consist of U.S. Government Agencies or corporate bonds rated “A” or better. The Company targets the following allocation percentages: (i) cash equivalents 10%; (ii) fixed income 40% ; and (iii) equities 50%. There is no Company stock included in equity securities at December 31, 2016 or 2015. The Company has not determined the amount of the expected contribution to the Employees’ Pension Plan for 2017. The following benefit payments are expected to be paid in the next five years and in the aggregate for the five years thereafter: Pension Benefits 2017 $ 2018 2019 2020 2021 Thereafter $ |
Income taxes
Income taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income taxes | |
Income taxes | 15. Income taxes: The current and deferred amounts of the provision for income taxes expense (benefit) for each of the years ended December 31, 2016, 2015 and 2014 are summarized as follows: Year Ended December 31 2016 2015 2014 Current $ $ $ Deferred $ $ $ The components of the net deferred tax asset at December 31, 2016 and 2015 are summarized as follows: December 31 2016 2015 Deferred tax assets: Allowance for loan losses $ $ Defined benefit plan Deferred compensation Capital loss carry forward Other Total Deferred tax liabilities: Premises and equipment, net Merger related accounting Investment securities available-for-sale Other Total Net deferred tax asset $ $ Management believes that future taxable income will be sufficient to utilize deferred tax assets. Core earnings of the Company have remained strong and will continue to support the recognition of the deferred tax asset based on future growth projections. A reconciliation between the amount of the effective income tax expense and the income tax expense that would have been provided at the federal statutory rate of 35.0 percent for the years ended December 31, 2016, 2015 and 2014 is summarized as follows: Year Ended December 31 2016 2015 2014 Federal income tax at statutory rate $ $ $ Tax exempt interest Bank owned life insurance income Residential housing program tax credits Other, net Total $ $ $ |
Parent Company financial statem
Parent Company financial statements | 12 Months Ended |
Dec. 31, 2016 | |
Parent Company financial statements | |
Parent Company financial statements | 16. Parent Company financial statements: CONDENSED BALANCE SHEETS December 31 2016 2015 Assets: Cash and cash equivalents $ $ Investment in bank subsidiary Due from subsidiaries Total assets $ $ Liabilities and Stockholders’ Equity: Other liabilities $ $ Stockholders’ equity Total liabilities and stockholders’ equity $ $ CONDENSED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME Year Ended December 31 2016 2015 2014 Income: Dividends from subsidiaries $ $ $ Other income Total income Expense: Other expenses Total expenses Income before taxes and undistributed income Income tax benefit Income before undistributed income of subsidiaries Equity in undistributed net income (loss) of subsidiaries Net income $ $ $ Comprehensive Income $ $ $ condensed Statements of Cash Flows Year Ended December 31 2016 2015 2014 Cash flows from operating activities: Net income $ $ $ Adjustments: Net realized gains on sales of securities Undistributed net income of subsidiaries Increase in other assets Decrease in other liabilities Stock based compensation Deferred income tax expense Increase in due from subsidiaries Net cash provided by operating activities Cash flows from investing activities: Proceeds from sale of available-for-sale securities Net cash provided by investing activities Cash flows from financing activities: Redemption of common stock Retirement of stock options Reissuance of treasury stock Purchase of treasury stock Cash dividends paid Net cash used in financing activities (Decrease) increase in cash Cash at beginning of year Cash at end of year $ $ $ |
Regulatory matters
Regulatory matters | 12 Months Ended |
Dec. 31, 2016 | |
Regulatory matters | |
Regulatory matters | 17. Regulatory matters: Dividends are paid by the Company from its assets, which are mainly provided by dividends from Peoples Bank. Under the Pennsylvania Business Corporation Law of 1988, as amended, the Company may not pay a dividend if, after payment, either the Company could not pay its debts as they become due in the usual course of business, or the Company’s total assets would be less than its total liabilities. The determination of total assets and liabilities may be based upon: (i) financial statements prepared on the basis of GAAP; (ii) financial statements that are prepared on the basis of other accounting practices and principles that are reasonable under the circumstances; or (iii) a fair valuation or other method that is reasonable under the circumstances. In addition, the Federal Reserve Board has the power to prohibit dividends by bank holding companies if their actions constitute unsafe or unsound practices. The Federal Reserve Board has issued a policy statement on the payment of cash dividends by bank holding companies, which expresses the Federal Reserve Board’s view that a bank holding company should pay cash dividends only to the extent that the company’s net income for the past year is sufficient to cover both the cash dividends and a rate of earnings retention that is consistent with the company’s capital needs, asset quality and overall financial condition. The Federal Reserve Board also indicated that it would be inappropriate for a bank holding company experiencing serious financial problems to borrow funds to pay dividends. Under the prompt corrective action regulations, the Federal Reserve Board may prohibit a bank holding company from paying any dividends if the holding company’s bank subsidiary is classified as “undercapitalized.” In addition, under the Pennsylvania Banking Code of 1965, as amended, Peoples Bank may only declare and pay dividends out of accumulated net earnings, including accumulated net earnings acquired as a result of a merger within seven years. Further, Peoples Bank may not declare or pay any dividend unless Peoples Bank’s surplus would not be reduced by the payment of the dividend below 100 percent of our capital stock. Pennsylvania law requires that each year Peoples Bank set aside as surplus, a sum equal to not less than 10 percent of its net earnings if surplus does not equal at least 100 percent of our capital stock. Under federal law and FDIC regulations, an insured bank may not pay dividends if doing so would make it undercapitalized within the meaning of the prompt corrective action law or if in default of its deposit insurance fund assessment. Although subject to the aforementioned regulatory restrictions, the Company’s consolidated retained earnings at December 31, 2016 and 2015 were not restricted under any borrowing agreement as to payment of dividends or reacquisition of common stock. The Company has paid cash dividends since its formation as a bank holding company in 1986. It is the present intention of the Board of Directors to continue this dividend payment policy, however, further dividends must necessarily depend upon earnings, financial condition, appropriate legal restrictions and other factors relevant at the time the Board of Directors considers payment of dividends. The Penseco merger agreement contemplates that, unless 80 percent of our Board of Directors determines otherwise, the Company will pay a quarterly cash dividend in an amount no less than $0.31 per share through 2018, provided that sufficient funds are legally available, and that the Company and Peoples Bank remain “well-capitalized” in accordance with applicable regulatory guidelines. The amount of funds available for transfer from Peoples Bank to the Company in the form of loans and other extensions of credit is also limited. Under Federal Regulation, transfers to any one affiliate are limited to 10.0 percent of capital and surplus. At December 31, 2016, the maximum amount available for transfer from Peoples Bank to the Company in the form of loans amounted to $20,593. At December 31, 2016 and 2015, there were no loans outstanding, nor were any advances made during 2016 and 2015. The Company and Peoples Bank are subject to certain regulatory capital requirements administered by the federal banking agencies, which are defined in Section 38 of the Federal Deposit Insurance Corporation Improvement Act of 1991 (“FDICIA”). 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 and Peoples Bank’s consolidated financial statements. In the event an institution is deemed to be undercapitalized by such standards, FDICIA prescribes an increasing amount of regulatory intervention, including the required institution of a capital restoration plan and restrictions on the growth of assets, branches or lines of business. Further restrictions are applied to the significantly or critically undercapitalized institutions including restrictions on interest payable on accounts, dismissal of management and appointment of a receiver. For well capitalized institutions, FDICIA provides authority for regulatory intervention when the institution is deemed to be engaging in unsafe and unsound practices or receives a less than satisfactory examination report rating. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and Peoples Bank must meet specific capital guidelines that involve quantitative measures of their assets, liabilities and certain off-balance sheet items as calculated under regulatory accounting practices. The capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings and other factors. Prompt corrective action provisions are not applicable to bank holding companies. New risk-based capital rules became effective January 1, 2015 requiring that banks and holding companies maintain a "capital conservation buffer" of 250 basis points in excess of the "minimum capital ratio." The minimum capital ratio is equal to the prompt corrective action adequately capitalized threshold ratio. The capital conservation buffer will be phased in over four years beginning on January 1, 2016, with a maximum buffer of 0.625% of risk weighted assets for 2016, 1.25% for 2017, 1.875% for 2018, and 2.5% for 2019 and thereafter. Failure to maintain the required capital conservation buffer will result in limitations on capital distributions and on discretionary bonuses to executive officers. Peoples Bank was categorized as “well capitalized” under the regulatory framework for prompt corrective action at December 31, 2016 and 2015, based on the most recent notification from the Federal Deposit Insurance Corporation. To be categorized as well capitalized, Peoples Bank must maintain certain minimum Tier I risk-based, total risk-based and Tier I Leverage ratios as set forth in the following tables. The Tier I Leverage ratio is defined as Tier I capital to total average assets less intangible assets. There are no conditions or events since the most recent notification that management believes have changed Peoples Bank’s category. The Company and Peoples Bank’s actual capital ratios at December 31, 2016 and 2015, and the minimum ratios required for capital adequacy purposes and to be well capitalized under the prompt corrective action provisions are as follows: Minimum to be Well Capitalized under Minimum For Capital Prompt Corrective Actual Adequacy Purposes Action Provisions December 31, 2016 Amount Ratio Amount Ratio Amount Ratio Common equity Tier 1 capital to risk-weighted assets: Consolidated $ % $ % Peoples Bank $ % Tier 1 capital to risk-weighted assets: Consolidated Peoples Bank Total capital to risk-weighted assets: Consolidated Peoples Bank Tier 1 capital to average assets: Consolidated Peoples Bank $ % $ % $ % Minimum to be Well Capitalized under Minimum For Capital Prompt Corrective Actual Adequacy Purposes Action Provisions December 31, 2015 Amount Ratio Amount Ratio Amount Ratio Common equity Tier 1 capital to risk-weighted assets: Consolidated $ % $ % Peoples Bank $ % Tier 1 capital to risk-weighted assets: Consolidated Peoples Bank Total capital to risk-weighted assets: Consolidated Peoples Bank Tier 1 capital to average assets: Consolidated Peoples Bank $ % $ % $ % |
Contingencies
Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Contingencies | |
Contingencies | 18. Contingencies: Neither the Company nor any of its property is subject to any material legal proceedings. Management, after consultation with legal counsel, does not anticipate that the ultimate liability, if any, arising out of pending and threatened lawsuits will have a material effect on the operating results or financial position of the Company. |
Comprehensive Income
Comprehensive Income | 12 Months Ended |
Dec. 31, 2016 | |
Comprehensive Income | |
Comprehensive Income | 19. Comprehensive Income: The components of accumulated other comprehensive loss included in stockholders’ equity at December 31, 2016 and 2015 are as follows: December 31, 2016 2015 Net unrealized gain on investment securities available-for-sale $ $ Income tax Net of income taxes Benefit plan adjustments Income tax Net of income taxes Accumulated other comprehensive loss $ $ Other comprehensive income (loss) and related tax effects for the years ended December 31, 2016, 2015 and 2014 are as follows: Year Ended December 31, 2016 2015 2014 Unrealized (loss) gain on investment securities available-for-sale $ $ $ Net gain on the sale of investment securities available-for-sale(1) Benefit plans: Amortization of actuarial loss (gain)(2) Actuarial (loss) gain Net change in benefit plan liabilities Other comprehensive income gain (loss) before taxes Income tax expense (benefit) Other comprehensive income (loss) $ $ $ (1) Represents amounts reclassified out of accumulated comprehensive loss and included in gains on sale of investment securities on the consolidated statements of income. (2) Represents amounts reclassified out of accumulated comprehensive loss and included in the computation of net periodic pension expense. Refer to Note 14 included in these consolidated financial statements. |
Summary of quarterly financial
Summary of quarterly financial information (unaudited) | 12 Months Ended |
Dec. 31, 2016 | |
Summary of quarterly financial information (unaudited) | |
Summary of quarterly financial information (unaudited) | 20. Summary of quarterly financial information (unaudited): 2016 Quarter Ended March 31 June 30 Sept. 30 Dec. 31 Interest income $ $ $ $ Interest expense Net interest income Provision for loan losses Net interest income after provision for loan losses Noninterest income Noninterest expense Income before income taxes Income tax expense Net income $ $ $ $ Per share data: Net income $ $ $ $ Cash dividends declared $ $ $ $ Average common shares outstanding 2015 Quarter Ended March 31 June 30 Sept. 30 Dec. 31 Interest income $ $ $ $ Interest expense Net interest income Provision for loan losses Net interest income after provision for loan losses Noninterest income Noninterest expense Income before income taxes Income tax expense Net income $ $ $ $ Per share data: Net income $ $ $ $ Cash dividends declared $ $ $ $ Average common shares outstanding |
Summary of significant accoun28
Summary of significant accounting policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Summary of significant accounting policies | |
Nature of operations | Nature of operations: Peoples Financial Services Corp., a bank holding company incorporated under the laws of Pennsylvania, provides a full range of financial services through its wholly-owned subsidiary, Peoples Security Bank and Trust Company (“Peoples Bank”), including its subsidiary, Peoples Advisors, LLC (collectively, the “Company” or “Peoples”). On November 30, 2013, Penseco Financial Services Corporation, a financial holding company incorporated under the laws of Pennsylvania (“Penseco”), merged with and into Peoples Financial Services Corp., with Peoples Financial Services Corp. being the surviving corporation (the “Merger”), pursuant to an Agreement and Plan of Merger dated June 28, 2013 (the “Merger Agreement”). In connection with the Merger, on December 1, 2013, Penseco’s former banking subsidiary, Penn Security Bank and Trust Company, merged with and into Peoples Neighborhood Bank (the “Bank Merger”), and the resulting institution adopted the name Peoples Security Bank and Trust Company. The Company services its retail and commercial customers through twenty-five full-service community banking offices located within Lackawanna, Lehigh, Luzerne, Monroe, Montgomery, Susquehanna, Wayne and Wyoming Counties of Pennsylvania and Broome County of New York. Peoples Bank is a state-chartered bank and trust company under the jurisdiction of the Pennsylvania Department of Banking and Securities and the Federal Deposit Insurance Corporation. Peoples Bank’s primary product is loans to small- and medium-sized businesses. Other lending products include one-to-four family residential mortgages and consumer loans. Peoples Bank primarily funds its loans by offering open time deposits to commercial enterprises and individuals. Other deposit product offerings include certificates of deposits and various demand deposit accounts. Peoples Advisors, LLC, a member-managed limited liability company, provides investment advisory services through a third party to individuals and small businesses. Peoples Advisors, LLC did not meet the quantitative thresholds for required segment disclosure in conformity with accounting principles generally accepted in the United States of America (“GAAP”). Peoples Bank’s twenty-five community banking offices, all similar with respect to economic characteristics, share a majority of the following aggregation criteria: (i) products and services; (ii) operating processes; (iii) customer bases; (iv) delivery systems; and (v) regulatory oversight. Accordingly, they were aggregated into a single operating segment. The Company faces competition primarily from commercial banks, thrift institutions and credit unions within its market, many of which are substantially larger in terms of assets and capital. In addition, mutual funds and security brokers compete for various types of deposits, and consumer, mortgage, leasing and insurance companies compete for various types of loans and leases. Principal methods of competing for banking and permitted nonbanking services include price, nature of product, quality of service and convenience of location. The Company and Peoples Bank are subject to regulations of certain federal and state regulatory agencies and undergo periodic examinations. |
Basis of presentation | Basis of presentation: Under the acquisition method of accounting, in a business combination effected through an exchange of equity interests, consideration of the facts and circumstances surrounding a business combination that generally involve the relative ownership and control of the entity by each of the parties subsequent to the merger must be made in determining the acquirer for financial reporting purposes. Based on a review of these factors, the aforementioned merger between the Company and Penseco was accounted for as a reverse acquisition whereby Penseco was treated as the acquirer for accounting and reporting purposes. The consolidated financial statements of the Company have been prepared in conformity with GAAP, Regulation S-X and reporting practices applied in the banking industry. All significant intercompany balances and transactions have been eliminated in consolidation. The Company also presents herein condensed parent company only financial information regarding Peoples Financial Services Corp. (“Parent Company”). Prior period amounts are reclassified when necessary to conform with the current year’s presentation. Such reclassifications had no effect on financial position or results of operations. The Company has evaluated events and transactions occurring subsequent to the balance sheet date of December 31, 2016, for items that should potentially be recognized or disclosed in these consolidated financial statements. The evaluation was conducted through the date these consolidated financial statements were issued. |
Estimates | Estimates: The preparation of consolidated financial statements in conformity with GAAP 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 consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates that are particularly susceptible to material change in the near term relate to the determination of the allowance for loan losses, fair value of financial instruments, the valuation of real estate acquired in connection with foreclosures or in satisfaction of loans, the valuation of deferred tax assets, determination of other-than-temporary impairment losses on securities and impairment of goodwill Actual results could differ from those estimates. |
Investment securities | Investment securities: Investments securities are classified and accounted for as either held-to-maturity, available-for-sale, or trading account securities based on management’s intent at the time of acquisition. Management is required to reassess the appropriateness of such classifications at each reporting date. The Company classifies debt securities as held-to maturity when management has the positive intent and ability to hold such securities to maturity. Held-to-maturity securities are stated at cost, adjusted for amortization of premium and accretion of discount. Investment securities are designated as available-for-sale when they are to be held for indefinite periods of time as management intends to use such securities to implement asset/liability strategies or to sell them in response to changes in interest rates, prepayment risk, liquidity requirements, or other circumstances identified by management. Available-for-sale securities are reported at fair value, with unrealized gains and losses, net of income taxes, excluded from earnings and reported in a separate component of stockholders’ equity. All marketable equity securities are accounted for at fair value. Estimated fair values for investment securities are based on quoted market prices from a national pricing service. Realized gains and losses are computed using the specific identification method and are included in noninterest income. Premiums are amortized and discounts are accreted using the interest method over the contractual lives of investment securities. Investment securities that are bought and held principally for the purpose of selling them in the near term, in order to generate profits from market appreciation, are classified as trading account securities. Trading account securities are carried at market value. Interest on trading account securities is included in interest income. Profits or losses on trading account securities are included in noninterest income. Transfers of securities between categories are recorded at fair value at the date of the transfer, with the accounting treatment of unrealized gains or losses determined by the category into which the security is transferred. Management evaluates each investment security to determine if a decline in fair value below its amortized cost is an other-than-temporary impairment (“OTTI”) at least quarterly, and more frequently when economic or market concerns warrant an evaluation. Factors considered in determining whether an other-than-temporary impairment was incurred include: (i) the length of time and the extent to which the fair value has been less than amortized cost; (ii) the financial condition and near-term prospects of the issuer; (iii) whether a decline in fair value is attributable to adverse conditions specifically related to the security or specific conditions in an industry or geographic area; (iv) the credit-worthiness of the issuer of the security; (v) whether dividend or interest payments have been reduced or have not been made; (vi) an adverse change in the remaining expected cash flows from the security such that the Company will not recover the amortized cost of the security; (vii) whether management intends to sell the security; and (viii) if it is more likely than not that management will be required to sell the security before recovery. If a decline is judged to be other-than-temporary, the individual security is written-down to fair value with the credit related component of the write-down included in earnings and the non-credit related component included in other comprehensive income or loss. The assessment of whether an other-than-temporary impairment exists involves a high degree of subjectivity and judgment and is based on information available to management at a point in time. |
Loans held for sale | Loans held for sale: Loans held for sale consist of one-to-four family residential mortgages originated and intended for sale in the secondary market. The loans are carried in aggregate at the lower of cost or estimated market value, based upon current delivery prices in the secondary mortgage market. Net unrealized losses are recognized through a valuation allowance by corresponding charges to income. Gains or losses on the sale of these loans are recognized in noninterest income at the time of sale using the specific identification method. Loan origination fees, net of certain direct loan origination costs, are included in net gains or losses upon the sale of the related mortgage loan. All loans are sold without recourse. |
Loans, net | Loans, net: Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are stated at their outstanding unpaid principal balances, net of deferred fees or costs. Interest income is accrued on the principal amount outstanding. Loan origination fees, net of certain direct origination costs, are deferred and recognized over the contractual life of the related loan as an adjustment to yield using the effective interest method. Premiums and discounts on purchased loans are amortized as adjustments to interest income using the effective interest method. Delinquency fees are recognized in income at the time when they are paid by customer. Transfers of financial assets, which include loan participation sales, are accounted for as sales, when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when: (i) the assets have been isolated from the Company; (ii) the transferee obtains the right, free of conditions that constrain it from taking advantage of that right, to pledge or exchange the transferred assets and (iii) the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity. The loan portfolio is segmented into commercial and retail loans. Commercial loans consist of commercial, commercial real estate, municipal and other related tax free loans. Retail loans consist of residential real estate and other consumer loans. The Company makes commercial loans for real estate development and other business purposes required by the customer base. The Company’s credit policies establish advance rates against the different forms of collateral that can be pledged against various commercial loans. Typically, the majority of loans will be underwritten to a percentage of their underlying collateral values such as real estate values, equipment, eligible accounts receivable and inventory. Individual loan advance rates may be higher or lower depending upon the financial strength of the borrower and/or term of the loan. Generally, assets financed through commercial loans are used for the operations of the business. Repayment for these types of loans generally comes from the cash flow of the business or the ongoing conversion of assets. Commercial real estate loans include construction, mini-perm, or longer term loans financing commercial properties. Repayment of these loans are generally dependent upon either the ongoing business cash flow from an owner occupied property or the lease/rental income or sale of a non-owner occupied property. Commercial real estate loans typically require a loan to value of not greater than 80% and vary in terms. Commercial and commercial real estate loans generally have higher credit risk compared to residential mortgage loans and consumer loans, as they typically involve larger loan balances concentrated with single borrowers or groups of borrowers. In addition, the payment expectations on loans secured by income-producing properties typically depend on the successful operations of the related business and thus may be subject to a greater extent to adverse conditions in the real estate market and in the general economy. Loans secured by commercial real estate generally have larger balances and involve a greater degree of risk than one-to-four family residential mortgage loans. Of primary concern in commercial real estate lending is the borrower’s and any guarantor’s creditworthiness and the feasibility and cash flow potential of the financed project. Additional considerations include: location, market and geographic concentration risks, loan to value, strength of guarantors and quality of tenants. Payments on loans secured by income properties often depend on successful operation and management of the properties. As a result, repayment of such loans may be subject to a higher level of risk than residential real estate loans, which could be caused by unfavorable conditions in the real estate market or the economy. To effectively monitor loans on income properties, we require borrowers and loan guarantors, if any, to provide annual financial statements on commercial real estate loans and rent rolls where applicable. In reaching a decision on whether to make a commercial real estate loan, we consider and review a cash flow analysis of the borrower and guarantor, when applicable. In addition, we evaluate business cash flows, if applicable, net operating income of the property, the borrower’s expertise, credit history and the value of the underlying property. We have generally required that the properties securing these real estate loans have debt service coverage ratios , which is net cash flow before debt service to debt service, of at least 1.2 times. An environmental report is obtained when the possibility exists that hazardous materials may have existed on the site, or the site may have been impacted by adjoining properties that handled hazardous materials. Commercial loans are generally made on the basis of a business entity or individual borrower’s ability to make repayment from business cash flows or individual borrowers’ employment and other income. Commercial business loans tend to have a slightly higher risk than commercial real estate loans because collateral usually consists of business assets versus real estate. Further, any collateral securing such loans may depreciate over time and could be difficult to appraise and liquidate. As a result, repayment of commercial business loans may depend substantially on the success of the business itself. Residential mortgages, including home equity loans, are secured by the borrower’s residential real estate in either a first or second lien position. Residential mortgages have varying loan rates depending on the financial condition of the borrower, loan to value ratio and term. Residential mortgages may have amortizations up to 30 years. Consumer loans include installment loans, car loans, and overdraft lines of credit. These loans are both secured and unsecured. Consumer loans may entail greater risk than do residential mortgage loans, particularly in the case of consumer loans that are unsecured. Repossessed collateral for a defaulted consumer loan may not provide an adequate source of repayment for the outstanding loan and a small remaining deficiency often does not warrant further substantial collection efforts against the borrower. Consumer loan collections depend on the borrower’s continuing financial stability, and therefore are likely to be adversely affected by various factors, including job loss, divorce, illness or personal bankruptcy. Furthermore, the application of various federal and state laws, including federal and state insolvency laws, may limit the amount that can be recovered on such loans. |
Off-balance sheet financial instruments | Off-balance sheet financial instruments: In the ordinary course of business, the Company has entered into off-balance sheet financial instruments consisting of commitments to extend credit, unused portions of lines of credit and standby letters of credit. These financial instruments are recorded in the consolidated financial statements when they are funded. Fees on commercial letters of credit and on unused available lines of credit are recorded as interest and fees on loans and are included in interest income when paid. The Company records an allowance for off-balance sheet credit losses, if deemed necessary, separately as a liability. |
Nonperforming assets | Nonperforming assets: Nonperforming assets consist of nonperforming loans and other real estate owned. Nonperforming loans include nonaccrual loans, troubled debt restructured loans and accruing loans past due 90 days or more. Past due status is based on contractual terms of the loan. Generally, a loan is classified as nonaccrual when it is determined that the collection of all or a portion of interest or principal is doubtful or when a default of interest or principal has existed for 90 days or more, unless the loan is well secured and in the process of collection. When a loan is placed on nonaccrual, interest accruals discontinue and uncollected accrued interest is reversed against income in the current period. Interest collections after a loan has been placed on nonaccrual status are credited to a suspense account until either the loan is returned to performing status or charged-off. The interest accumulated in the suspense account is credited to income over the remaining life of the loan using the effective yield method if the nonaccrual loan is returned to performing status. However, if the nonaccrual loan is charged-off, the accumulated interest is applied as a reduction to principal at the time the loan is charged-off. A nonaccrual loan is returned to performing status when the loan is current as to principal and interest and has performed according to the contractual terms for a minimum of six months. Troubled debt restructured loans are loans with original terms, interest rate, or both, that have been modified as a result of a deterioration in the borrower’s financial condition and a concession has been granted that the Company would not otherwise consider. Unless on nonaccrual, interest income on these loans is recognized when earned, using the interest method. The Company offers a variety of modifications to borrowers that would be considered concessions. The modification categories offered can generally fall within the following categories: · Rate Modification — A modification in which the interest rate is changed to a below market rate. · Term Modification — A modification in which the maturity date, timing of payments or frequency of payments is changed. · Interest Only Modification — A modification in which the loan is converted to interest only payments for a period of time. · Payment Modification — A modification in which the dollar amount of the payment is changed, other than an interest only modification described above. · Combination Modification — Any other type of modification, including the use of multiple categories above. The Company segments 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. Loans are individually analyzed for credit risk by classifying them within the Company’s internal risk rating system. The Company’s risk rating classifications are defined as follows: · Pass — A loan to borrowers with acceptable credit quality and risk that is not adversely classified as Substandard, Doubtful, Loss nor designated as Special Mention. · Special Mention — A loan that has potential weaknesses that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or in the institution’s credit position at some future date. Special Mention loans are not adversely classified since they do not expose the Company to sufficient risk to warrant adverse classification. · Substandard — A loan that is inadequately protected by the current sound worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the bank will sustain some loss if the deficiencies are not corrected. · Doubtful — A loan classified as Doubtful has all the weaknesses inherent in one classified Substandard with the added characteristic that the weaknesses make the collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. · Loss — A loan classified as Loss is considered uncollectible and of such little value that its continuance as bankable loans is not warranted. This classification does not mean that the loan has absolutely no recovery or salvage value, but rather it is not practical or desirable to defer writing off this basically worthless asset even though partial recovery may be effected in the future. Other real estate owned is comprised of properties acquired through foreclosure proceedings or in-substance foreclosures. A loan is classified as in-substance foreclosure when the Company has taken possession of the collateral regardless of whether formal foreclosure proceedings take place. Other real estate owned is included in other assets and recorded at fair value less cost to sell at the time of acquisition, establishing a new cost basis. Any excess of the loan balance over the recorded value is charged to the allowance for loan losses. Subsequent declines in the recorded values of the properties prior to their disposal and costs to maintain the assets are included in other expenses. Any gain or loss realized upon disposal of other real estate owned is included in noninterest expense. |
Allowance for loan losses | Allowance for loan losses: The allowance for loan losses represents management’s estimate of losses inherent in the loan portfolio as of the balance sheet date. The allowance for loan losses account is maintained through a provision for loan losses charged to earnings. Loans, or portions of loans, determined to be confirmed losses are charged against the allowance account and subsequent recoveries, if any, are credited to the account. A loss is considered confirmed when information available at the financial statement date indicates the loan, or a portion thereof, is uncollectible. Nonaccrual, troubled debt restructured and loans deemed impaired at the time of acquisition are reviewed monthly to determine if carrying value reductions are warranted or if these classifications should be changed. Consumer loans are considered losses and charged-off when they are 120 days past due. Management evaluates the adequacy of the allowance for loan losses account quarterly. This assessment is based on past charge-off experience, known and inherent risks in the portfolio, adverse situations that may affect the borrower’s ability to repay, the estimated value of underlying collateral, composition of the loan portfolio, current economic conditions and other relevant factors. This evaluation is inherently subjective as it requires material estimates that may be susceptible to significant revision as more information becomes available. Regulators, in reviewing the loan portfolio as part of the scope of a regulatory examination, may require the Company to increase its allowance for loan losses or take other actions that would require the Company to increase its allowance for loan losses. The allowance for loan losses is maintained at a level believed to be adequate to absorb probable credit losses related to specifically identified loans, as well as probable incurred losses inherent in the remainder of the loan portfolio as of the balance sheet date. The allowance for loan losses consists of an allocated element and an unallocated element. The allocated element consists of a specific allowance for impaired loans individually evaluated under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 310, “Receivables,” and a formula portion for loss contingencies on those loans collectively evaluated under FASB ASC 450, “Contingencies.” A loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. All amounts due according to the contractual terms means that both the contractual interest and principal payments of a loan will be collected as scheduled in the loan agreement. Factors considered by management in determining impairment include payment status, ability to pay and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed. The Company recognizes interest income on impaired loans, including the recording of cash receipts, for nonaccrual, restructured loans or accruing loans depending on the status of the impaired loan. Loans considered impaired under FASB ASC 310 are measured for impairment based on the present value of expected future cash flows discounted at the loan’s effective interest rate or the fair value of the collateral if the loan is collateral dependent. If the present value of expected future cash flows discounted at the loan’s effective interest rate or the fair value of the collateral, if the loan is collateral dependent, is less than the recorded investment in the loan, a specific allowance for the loan will be established. The formula portion of the allowance for loan losses relates to large pools of smaller-balance homogeneous loans and those identified loans considered not individually impaired having similar characteristics as these loan pools. Loss contingencies for each of the major loan pools are determined by applying a total loss factor to the current balance outstanding for each individual pool. The total loss factor is comprised of a historical loss factor using a loss migration method plus qualitative factors, which adjusts the historical loss factor for changes in trends, conditions and other relevant factors that may affect repayment of the loans in these pools as of the evaluation date. Loss migration involves determining the percentage of each pool that is expected to ultimately result in loss based on historical loss experience. Historical loss factors are based on the ratio of net loans charged-off to loans, net, for each of the major groups of loans evaluated and measured for impairment under FASB ASC 450. The historical loss factor for each pool is a weighted average of the Company’s historical net charge-off ratio for the most recent rolling twelve quarters. Management adjusts these historical loss factors by qualitative factors that represents a number of environmental risks that may cause estimated credit losses associated with the current portfolio to differ from historical loss experience. These environmental risks include: (i) changes in lending policies and procedures including underwriting standards and collection, charge-off and recovery practices; (ii) changes in the composition and volume of the portfolio; (iii) changes in national, local and industry conditions, including the effects of such changes on the value of underlying collateral for collateral-dependent loans; (iv) changes in the volume and severity of classified loans, including past due, nonaccrual, troubled debt restructures and other loan modifications; (v) changes in the levels of, and trends in, charge-offs and recoveries; (vi) the existence and effect of any concentrations of credit and changes in the level of such concentrations; (vii) changes in the experience, ability and depth of lending management and other relevant staff; (viii) changes in the quality of the loan review system and the degree of oversight by the board of directors; and (ix) the effect of external factors such as competition and legal and regulatory requirements on the level of estimated credit losses in the current loan portfolio. Each environmental risk factor is assigned a value to reflect improving, stable or declining conditions based on management’s best judgment using relevant information available at the time of the evaluation. Adjustments to the factors are supported through documentation of changes in conditions in a narrative accompanying the allowance for loan loss calculation. The unallocated element is used to cover inherent losses that exist as of the evaluation date, but which have not been identified as part of the allocated allowance using the above impairment evaluation methodology due to limitations in the process. One such limitation is the imprecision of accurately estimating the impact current economic conditions will have on historical loss rates. Variations in the magnitude of impact may cause estimated credit losses associated with the current portfolio to differ from historical loss experience, resulting in an allowance that is higher or lower than the anticipated level. Management establishes the unallocated element of the allowance by considering a number of environmental risks similar to the ones used for determining the qualitative factors. Management continually monitors trends in historical and qualitative factors, including trends in the volume, composition and credit quality of the portfolio. The reasonableness of the unallocated element is evaluated through monitoring trends in its level to determine if changes from period to period are directionally consistent with changes in the loan portfolio. Management believes the level of the allowance for loan losses was adequate to absorb probable credit losses as of December 31, 2016. |
Premises and equipment, net | Premises and equipment, net: Land is stated at cost. Premises, equipment and leasehold improvements are stated at cost less accumulated depreciation and amortization. The cost of routine maintenance and repairs is expensed as incurred. The cost of major replacements, renewals and betterments is capitalized. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation and amortization are eliminated and any resulting gain or loss is reflected in noninterest income. Depreciation and amortization are computed principally using the straight-line method based on the following estimated useful lives of the related assets, or in the case of leasehold improvements, to the expected terms of the leases, if shorter: Premises and leasehold improvements 7 – 40 years Furniture, fixtures and equipment 3 – 10 years |
Business combinations, goodwill and other intangible assets, net | Business combinations, goodwill and other intangible assets, net: The Company accounts for its acquisitions using the purchase accounting method. Purchase accounting requires the total purchase price to be allocated to the estimated fair values of assets acquired and liabilities assumed, including certain intangible assets that must be recognized. Typically, this allocation results in the purchase price exceeding the fair value of net assets acquired, which is recorded as goodwill. Core deposit intangibles are a measure of the value of checking, money market and savings deposits acquired in business combinations accounted for under the purchase method. Core deposit intangibles and other identified intangibles with finite useful lives are amortized using the sum of the year’s digits over their estimated useful lives of up to ten years. Loans that the Company acquires in connection with acquisitions are recorded at fair value with no carryover of the related allowance for credit losses. Fair value of the loans involves estimating the amount and timing of principal and interest cash flows expected to be collected on the loans and discounting those cash flows at a market rate of interest. The excess of cash flows expected at acquisition over the estimated fair value is referred to as the accretable discount and is recognized into interest income over the remaining life of the loan. The difference between contractually required payments at acquisition and the cash flows expected to be collected at acquisition is referred to as the nonaccretable discount. The nonaccretable discount includes estimated future credit losses expected to be incurred over the life of the loan. Subsequent decreases to the expected cash flows will require the Company to evaluate the need for an additional allowance for credit losses. Subsequent improvement in expected cash flows will result in the reversal of a corresponding amount of the nonaccretable discount which the Company will then reclassify as accretable discount that will be recognized into interest income over the remaining life of the loan. Acquired loans that met the criteria for nonaccrual of interest prior to the acquisition may be considered performing upon acquisition, regardless of whether the customer is contractually delinquent. As such, the Company may no longer consider the loan to be nonaccrual or nonperforming and may accrue interest on these loans, including the impact of any accretable discount. In addition, charge-offs on such loans would be first applied to the nonaccretable difference portion of the fair value adjustment. Goodwill and other intangible assets are tested for impairment annually or when circumstances arise indicating impairment may have occurred. In making this assessment that impairment has occurred, management considers a number of factors including, but not limited to, operating results, business plans, economic projections, anticipated future cash flows, and current market data. There are inherent uncertainties related to these factors and management’s judgment in applying them to the analysis of impairment. Changes in economic and operating conditions, as well as other factors, could result in impairment in future periods. Any impairment losses arising from such testing would be reported in the Consolidated Statements of Income and Comprehensive Income as a separate line item within operations. There were no impairment losses recognized as a result of periodic impairment testing in each of the three-years ended December 31, 2016. |
Mortgage servicing rights | Mortgage servicing rights: Mortgage servicing rights are recognized as a separate asset when acquired through sales of loan originations. The Company determines a mortgage servicing right by allocating the total costs incurred between the loan sold and the servicing right, based on their relative fair values at the date of the sale. Mortgage servicing rights are included in other assets and are amortized into noninterest income in proportion to, and over the period of, the estimated future net servicing income of the underlying mortgage loans. In addition, mortgage servicing rights are evaluated for impairment at each reporting date based on the fair value of those rights. For purposes of measuring impairment, the rights are stratified by loan type, term and interest rate. The amount of impairment recognized, through a valuation allowance, is the amount by which the mortgage servicing rights for a stratum exceed their fair value. |
Restricted equity securities | Restricted equity securities: As a member of the Federal Home Loan Bank of Pittsburgh (“FHLB”), the Company is required to purchase and hold stock in the FHLB to satisfy membership and borrowing requirements. This stock is restricted in that it can only be redeemed by the FHLB or to another member institution, and all redemptions of FHLB stock must be at par. As a result of these restrictions, FHLB stock is unlike other investment securities as there is no trading market for FHLB stock and the transfer price is determined by FHLB membership rules and not by market participants. The carrying value of restricted stock is included in other assets. |
Bank owned life insurance | Bank owned life insurance: The Company invests in bank owned life insurance (“BOLI”) as a source of funding for employee benefit expenses. BOLI involves the purchasing of life insurance by Peoples Bank on certain of its employees. The Company is the owner and beneficiary of the policies. This life insurance investment is carried at the cash surrender value of the underlying policies and is included in other assets. Income from increases in cash surrender value of the policies is included in noninterest income. |
Pension and post-retirement benefit plans | Pension and post-retirement benefit plans: The Company sponsors various pension plans covering substantially all employees. The Company also provides post-retirement benefit plans other than pensions, consisting principally of life insurance benefits, to eligible retirees. The liabilities and annual income or expense of the Company’s pension and other post-retirement benefit plans are determined using methodologies that involve several actuarial assumptions, the most significant of which are the discount rate and the long-term rate of asset return, based on the market-related value of assets. The fair values of plan assets are determined based on prevailing market prices or estimated fair value for investments with no available quoted prices. |
Statements of Cash Flows | Statements of Cash Flows: The Consolidated Statements of Cash Flows are presented using the indirect method. For purposes of cash flow, cash and cash equivalents include cash on hand, cash items in the process of collection, noninterest-bearing and interest-bearing deposits in other banks and federal funds sold. |
Fair value of financial instruments | Fair value of financial instruments: The Company uses fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosure under GAAP. Fair value estimates are calculated without attempting to estimate the value of anticipated future business and the value of certain assets and liabilities that are not considered financial. Accordingly, such assets and liabilities are excluded from disclosure requirements. In accordance with FASB ASC 820, “Fair Value Measurements and Disclosures,” fair value is the price that would be received to sell an asset or transfer a liability in an orderly transaction between market participants at the measurement date. Fair value is best determined based upon quoted market prices. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets. In many cases, these values cannot be realized in immediate settlement of the instrument. Current fair value guidance provides a consistent definition of fair value, which focuses on exit price in an orderly transaction that is not a forced liquidation or distressed sale between participants at the measurement date under current market conditions. If there has been a significant decrease in the volume and level of activity for the asset or liability, a change in valuation technique or the use of multiple valuation techniques may be appropriate. In such instances, determining the price at which willing market participants would transact at the measurement date under current market conditions depends on the facts and circumstances and requires the use of significant judgment. The fair value is a reasonable point within the range that is most representative of fair value under current market conditions. In accordance with GAAP, the Company groups its assets and liabilities generally measured at fair value into three levels based on market information or other fair value estimates in which the assets and liabilities are traded or valued and the reliability of the assumptions used to determine fair value. These levels include: · Level 1: Unadjusted quoted prices of 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; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. · 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. The following methods and assumptions were used by the Company to construct the summary table in Note 12 containing the fair values and related carrying amounts of financial instruments: |
Cash and cash equivalents | Cash and cash equivalents: The carrying values of cash and cash equivalents as reported on the balance sheet approximate fair value. |
Investment securities | Investment securities: The fair values of marketable equity securities are based on quoted market prices from active exchange markets. The fair values of debt securities are based on pricing from a matrix pricing model and quoted market prices. |
Loans held for sale | Loans held for sale: The fair values of loans held for sale are based upon current delivery prices in the secondary mortgage market. |
Net loans | Net loans: For adjustable-rate loans that reprice frequently and with no significant credit risk, fair values are based on carrying values. The fair values of other nonimpaired loans are estimated using discounted cash flow analysis, using interest rates currently offered in the market for loans with similar terms to borrowers of similar credit risk. Fair values for impaired loans are estimated using discounted cash flow analysis determined by the loan review function or underlying collateral values, where applicable. In conjunction with the Merger, the loans purchased were recorded at their acquisition date fair value. In order to record the loans at fair value, management made three different types of fair value adjustments. A market rate adjustment was made to adjust for the movement in market interest rates, irrespective of credit adjustments, compared to the stated rates of the acquired loans. A credit adjustment was made on pools of homogeneous loans representing the changes in credit quality of the underlying borrowers from the loan inception to the acquisition date. The credit adjustment on distressed loans represents the portion of the loan balance that has been deemed uncollectible based on the management’s expectations of future cash flows for each respective loan. |
Mortgage servicing rights | Mortgage servicing rights: To determine the fair value, the Company estimates the present value of future cash flows incorporating assumptions such as cost of servicing, discount rates, prepayment speeds and default rates. |
Accrued interest receivable | Accrued interest receivable: The carrying value of accrued interest receivable as reported on the balance sheet approximates fair value. |
Restricted equity securities | Restricted equity securities: The carrying values of restricted equity securities approximate fair value, due to the lack of marketability for these securities. |
Deposits | Deposits: The fair values of noninterest-bearing deposits and savings, NOW and money market accounts are the amounts payable on demand at the reporting date. The fair value estimates do not include the benefit that results from such low-cost funding provided by the deposit liabilities compared to the cost of borrowing funds in the market. The carrying values of adjustable-rate, fixed-term time deposits approximate their fair values at the reporting date. For fixed-rate time deposits, the present value of future cash flows is used to estimate fair values. The discount rates used are the current rates offered for time deposits with similar maturities. The fair value assigned to the core deposit intangible asset represents the future economic benefit of the potential cost savings from acquiring core deposits in the Merger compared to the cost of obtaining alternative funding such as brokered deposits from market sources. Management utilized an income valuation approach to present value the estimated future cash savings in order to determine the fair value of the intangible asset. |
Short-term borrowings | Short-term borrowings: The carrying values of short-term borrowings approximate fair value. |
Long-term debt | Long-term debt: The fair value of fixed-rate long-term debt is based on the present value of future cash flows. The discount rate used is the current rate offered for long-term debt with the same maturity. |
Accrued interest payable | Accrued interest payable: The carrying value of accrued interest payable as reported on the balance sheet approximates fair value. |
Off balance sheet financial instruments | Off-balance sheet financial instruments: The majority of commitments to extend credit, unused portions of lines of credit and standby letters of credit carry current market interest rates if converted to loans. Because such commitments are generally unassignable of either the Company or the borrower, they only have value to the Company and the borrower. None of the commitments are subject to undue credit risk. The estimated fair values of off-balance sheet 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 off-balance sheet financial instruments was not material at December 31, 2016 and December 31, 2015. |
Advertising | Advertising: The Company follows the policy of charging marketing and advertising costs to expense as incurred. Advertising expense for the years ended December 31, 2016, 2015 and 2014 was $972, $764 and $450, respectively. |
Income taxes | Income taxes: The Company accounts for income taxes in accordance with the income tax accounting guidance set forth in FASB ASC Topic 740, “Income Taxes”. ASC Topic 740 sets out a consistent framework to determine the appropriate level of tax reserves to maintain for uncertain tax positions. Deferred income taxes are provided on the balance sheet method whereby deferred tax assets are recognized for deductible temporary differences and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax basis. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the effective date. 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 has a likelihood of being realized on examination of more than 50 percent. For tax positions not meeting the more likely than not threshold, no tax benefit is recorded. Under the more likely than not threshold guidelines, the Company believes no significant uncertain tax positions exist, either individually or in the aggregate, that would give rise to the non-recognition of an existing tax benefit. The Company had no material unrecognized tax benefits or accrued interest and penalties for any year in the three-year period ended December 31, 2016. As applicable, the Company recognizes accrued interest and penalties assessed as a result of a taxing authority examination through income tax expense. The Company files consolidated income tax returns in the United States of America and various states’ jurisdictions. With limited exception, the Company is no longer subject to federal and state income tax examinations by taxing authorities for years before 2013. |
Other comprehensive income (loss) | Other comprehensive income (loss): The components of other comprehensive income (loss) and their related tax effects are reported in the Consolidated Statements of Income and Comprehensive Income. The accumulated other comprehensive loss included in the Consolidated Balance Sheets relates to net unrealized gains and losses on investment securities available-for-sale and the unfunded benefit plan amounts which include prior service costs and unrealized net losses. |
Earnings per share | Earnings per share: Basic earnings per share represent income available to common stockholders divided by the weighted-average number of common shares outstanding during the period. Diluted earnings per share reflect additional common shares that would have been outstanding if dilutive potential common shares had been issued, as well as any adjustment to income that would result from the assumed issuance. Potential common shares that may be issued by the Company relate solely to outstanding stock options, and are determined using the treasury stock method. 2016 2015 2014 For the Year Ended December 31 Basic Diluted Basic Diluted Basic Diluted Net Income $ $ $ $ $ $ Average common shares outstanding Earnings per share $ $ $ $ $ $ |
Stock-based compensation | Stock-based compensation: The Company recognizes all share-based payments to employees in the consolidated statement of operations based on their fair values. The fair value of such equity instruments is recognized as an expense in the historical consolidated financial statements as services are performed. The Company uses the Black-Scholes Model to estimate the fair value of each option on the date of grant. The Black-Scholes Model estimates the fair value of employee stock options using a pricing model which takes into consideration the exercise price of the option, the expected life of the option, the current market price and its expected volatility, the expected dividends on the stock and the current risk-free interest rate for the expected life of the option. The Company typically grants stock options to employees with an exercise price equal to the fair value of the shares at the date of grant. The fair value of restricted stock is equivalent to the fair value on the date of grant and is amortized over the vesting period. As of December 31, 2016 and 2015, all stock options were fully vested and there are no unrecognized compensation costs related to stock options. The Company has not granted stock options after 2005. |
Recent accounting standards | Recent accounting standards: In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606).” The updated standard is a new comprehensive revenue recognition model that requires revenue to be recognized in a manner that depicts the transfer of goods or services to a customer at an amount that reflects the consideration expected to be received in exchange for those goods or services. In August 2015, the FASB issued ASU 2015-14 which deferred the effective date of ASU 2014-09 by one year. During 2016, the FASB issued ASU Nos. 2016-10, 2016-12 and 2016-20 that provide additional guidance related to the identification of performance obligations within a contract, assessing collectability, contract costs, and other technical corrections and improvements. ASU 2014-09 will become effective for the Company for the annual period beginning after December 15, 2017 and for interim periods within the annual period. ASU 2014-09 allows for either full retrospective or modified retrospective adoption. The Company has not selected a transition method. The Company has completed an evaluation of its revenue-producing contracts and determined they are primarily agreements that are not within the scope of this standard. As a result, the Company does not expect the adoption of this standard to have a material impact to the Company’s reported revenues and interest income. The Company is continuing to evaluate the impact on other revenue and income sources. In January 2016, the FASB issued Accounting Standards Update ("ASU") No. 2016-01, “Financial Instruments – Overall . ” The guidance in this ASU among other things, (1) requires equity investments with certain exceptions, to be measured at fair value with changes in fair value recognized in net income, (2) simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment, (3) eliminates the requirement for public businesses entities to disclose the methods and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet, (4) requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes, (5) requires an entity to present separately in other comprehensive income the portion of the change in fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments, (6) requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or the accompanying notes to the financial statements and (7) clarifies that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities. The guidance in this ASU is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company is in the process of evaluating the impact of the adoption of this guidance on the Company’s financial statements. In February 2016, the FASB issued ASU No. 2016-02, “Leases”. From the lessee's perspective, the new standard establishes a right-of-use (“ROU”) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement for a lessess. From the lessor's perspective, the new standard requires a lessor to classify leases as either sales-type, finance or operating. A lease will be treated as a sale if it transfers all of the risks and rewards, as well as control of the underlying asset, to the lessee. If risks and rewards are conveyed without the transfer of control, the lease is treated as a financing. If the lessor doesn’t convey risks and rewards or control, an operating lease results. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early application is permitted. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. A modified retrospective transition approach is required for lessors for sales-type, direct financing, and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company’s initial findings conclude that the new pronouncement will not have a significant impact on its consolidated financial statements as the current projected minimum lease payments under existing lease contracts subject to the new pronouncement are less than one percent of its current assets. In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This ASU will have a significant impact on the Company’s calculation and accounting for its Allowance for Loan Losses as well as credit losses related to investment securities available-for-sale. A summary of significant provisions of this ASU is as follows: · The ASU requires that a financial asset (or a group of financial assets) measured at amortized cost basis be presented, net of a valuation allowance for credit losses, at an amount expected to be collected on the financial asset(s), and that the income statement include the measurement of credit losses for newly recognized financial assets as well as changes in expected losses on previously recognized financial assets. The provisions of this ASU require measurement of expected credit losses based on relevant information including past events, historical experience, current conditions, and reasonable and supportive forecasts that affect the collectability of the asset. The provisions of this ASU differ from current U.S. GAAP in that current U.S. GAAP generally delays recognition of the full amount of credit losses until the loss is probable of occurring. · The amendments in the Update retain many of the disclosure requirements related to credit quality in current U.S. GAAP, updated to reflect the change from an incurred loss methodology to an expected credit loss methodology. In addition, the Update requires that disclosure of credit quality indicators in relation to the amortized cost of financing receivables, a current requirement, be further disaggregated by year of origination. · This ASU requires that credit losses on available-for-sale debt securities be presented as an allowance rather than as a write-down, and limits the amount of the allowance for credit losses to the amount by which the fair value is below amortized cost. For purchased investment securities available-for-sale with a more-than-insignificant amount of credit deterioration since origination, the ASU requires an allowance be determined in a manner similar to other investment securities available-for-sale; however, the initial allowance would be added to the purchase price, with only subsequent changes in the allowance recorded in credit loss expense, and interest income recognized at the effective rate excluding the discount embedded in the purchase price related to estimated credit losses at acquisition. · This ASU will be effective for the Company for interim and annual periods beginning in the first quarter of 2020. Earlier adoption is permitted beginning in the first quarter of 2019. The Company will record the effect of implementing this ASU through a cumulative-effect adjustment through retained earnings as of the beginning of the reporting period in which Topic 326 is effective. The Company cannot yet determine the magnitude of any such one-time cumulative adjustment or of the overall impact of the new standard on our financial condition or results of operations; however, it is anticipated that the allowance will increase upon adoption and that the increased allowance level will decrease regulatory capital and ratios.. In June 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230) –Classification of Certain Cash Receipts and Cash Payments. This Update provides clarification regarding eight specific cash flow issues with the objective of reducing diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. For the Company, the amendments in this Update are effective beginning in the first quarter 2018. The amendments in this Update should be applied using a retroactive transition method to each period presented. The Company anticipates there will be no adjustments to the Consolidated Statements of Cash Flows, as previously reported, as a result of the clarifications provided in the Update. In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350) to simplify the accounting for goodwill impairment. This guidance, among other things, removes step 2 of the goodwill impairment test thus eliminating the need to determine the fair value of individual assets and liabilities of the reporting unit. Upon adoption of this ASU, goodwill impairment will be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. This may result in more or less impairment being recognized than under current guidance. This Update will become effective for the Company’s annual and interim goodwill impairment tests beginning in the first quarter of 2020. |
Summary of significant accoun29
Summary of significant accounting policies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Summary of significant accounting policies | |
Estimated Useful Lives of Related Assets | Premises and leasehold improvements 7 – 40 years Furniture, fixtures and equipment 3 – 10 years |
Schedule of earnings per share | 2016 2015 2014 For the Year Ended December 31 Basic Diluted Basic Diluted Basic Diluted Net Income $ $ $ $ $ $ Average common shares outstanding Earnings per share $ $ $ $ $ $ |
Investment securities (Tables)
Investment securities (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Amortized cost and fair value of investment securities aggregated by investment category | Gross Gross Amortized Unrealized Unrealized Fair December 31, 2016 Cost Gains Losses Value Available-for-sale: U.S. Treasury securities $ $ $ U.S. Government-sponsored enterprises $ State and municipals: Taxable Tax-exempt Mortgage-backed securities: U.S. Government agencies U.S. Government-sponsored enterprises Total $ $ $ $ Held-to-maturity: Tax-exempt state and municipals $ $ $ $ Mortgage-backed securities: U.S. Government agencies U.S. Government-sponsored enterprises Total $ $ $ $ Gross Gross Amortized Unrealized Unrealized Fair December 31, 2015 Cost Gains Losses Value Available-for-sale: U.S. Treasury securities $ $ $ U.S. Government-sponsored enterprises $ State and municipals: Taxable Tax-exempt Mortgage-backed securities: U.S. Government agencies U.S. Government-sponsored enterprises Total $ $ $ $ Held-to-maturity: Tax-exempt state and municipals $ $ $ $ Mortgage-backed securities: U.S. Government agencies U.S. Government-sponsored enterprises Total $ $ $ $ |
Fair value and unrealized losses of investment securities in continuous unrealized loss position | Less Than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized December 31, 2016 Value Losses Value Losses Value Losses U.S. Treasury securities $ $ $ $ U.S. Government-sponsored enterprises State and municipals: Taxable Tax-exempt $ $ Mortgage-backed securities: U.S. Government agencies U.S. Government-sponsored enterprises Total $ $ $ $ $ $ Less Than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized December 31, 2015 Value Losses Value Losses Value Losses U.S. Treasury securities $ $ $ $ U.S. Government-sponsored enterprises State and municipals: Taxable $ $ Tax-exempt Mortgage-backed securities: U.S. Government agencies U.S. Government-sponsored enterprises Total $ $ $ $ $ $ |
Available-for-Sale Securities | |
Maturity distribution of fair value | Fair December 31, 2016 Value Within one year $ After one but within five years After five but within ten years After ten years Mortgage-backed securities Total $ |
Held-to-maturity Securities | |
Maturity distribution of fair value | Amortized Fair December 31, 2016 Cost Value Within one year After one but within five years After five but within ten years After ten years $ $ Mortgage-backed securities Total $ $ |
Loans, net and allowance for 31
Loans, net and allowance for loan losses (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Loans, net and allowance for loan losses | |
Major classifications of loans outstanding | December 31 2016 2015 Commercial $ $ Real estate: Commercial Residential Consumer Total $ $ |
Changes in allowance for loan losses account by major classification of loans | Real estate December 31, 2016 Commercial Commercial Residential Consumer Unallocated Total Allowance for loan losses: Beginning balance $ $ $ $ $ $ Charge-offs Recoveries Provisions Ending balance $ $ $ $ $ $ Ending balance: individually evaluated for impairment Ending balance: collectively evaluated for impairment Ending balance: loans acquired with deteriorated credit quality $ $ $ $ $ — Loans receivable: Ending balance $ $ $ $ $ $ Ending balance: individually evaluated for impairment Ending balance: collectively evaluated for impairment Ending balance: loans acquired with deteriorated credit quality $ $ $ $ $ $ Real estate December 31, 2015 Commercial Commercial Residential Consumer Unallocated Total Allowance for loan losses: Beginning balance $ $ $ $ $ $ Charge-offs Recoveries Provisions Ending balance $ $ $ $ $ $ Ending balance: individually evaluated for impairment Ending balance: collectively evaluated for impairment Ending balance: loans acquired with deteriorated credit quality $ $ $ $ $ Loans receivable: Ending balance $ $ $ $ $ $ Ending balance: individually evaluated for impairment Ending balance: collectively evaluated for impairment Ending balance: loans acquired with deteriorated credit quality $ $ $ $ $ Real estate December 31, 2014 Commercial Commercial Residential Consumer Unallocated Total Allowance for loan losses: Beginning balance $ $ $ $ $ $ Charge-offs Recoveries Provisions Ending balance $ $ $ $ $ $ Ending balance: individually evaluated for impairment Ending balance: collectively evaluated for impairment Ending balance: loans acquired with deteriorated credit quality $ $ $ $ $ $ Loans receivable: Ending balance $ $ $ $ $ $ Ending balance: individually evaluated for impairment Ending balance: collectively evaluated for impairment Ending balance: loans acquired with deteriorated credit quality $ $ $ $ $ $ |
Major classification of loans portfolio summarized by credit quality | Special December 31, 2016 Pass Mention Substandard Doubtful Total Commercial $ $ $ $ $ Real estate: Commercial Residential Consumer Total $ $ $ $ $ Special December 31, 2015 Pass Mention Substandard Doubtful Total Commercial $ $ $ $ $ Real estate: Commercial Residential Consumer Total $ $ $ $ $ |
Information concerning nonaccrual loans by major loan classification | December 31, 2016 December 31, 2015 Commercial $ $ Real estate: Commercial Residential Consumer Total $ $ |
Major classifications of loans by past due status | Greater Loans > 90 30-59 Days 60-89 Days than 90 Total Past Days and December 31, 2016 Past Due Past Due Days Due Current Total Loans Accruing Commercial $ $ $ $ $ $ Real estate: Commercial Residential $ Consumer Total $ $ $ $ $ $ $ Greater Loans > 90 30-59 Days 60-89 Days than 90 Total Past Days and December 31, 2015 Past Due Past Due Days Due Current Total Loans Accruing Commercial $ $ $ $ $ $ Real estate: Commercial Residential $ Consumer Total $ $ $ $ $ $ $ |
Summarized information concerning impaired loans | For the Year Ended Unpaid Average Interest Recorded Principal Related Recorded Income December 31, 2016 Investment Balance Allowance Investment Recognized With no related allowance: Commercial $ $ $ $ Real estate: Commercial Residential Consumer Total With an allowance recorded: Commercial $ Real estate: Commercial Residential Consumer Total Commercial Real estate: Commercial Residential Consumer — Total $ $ $ $ $ For the Year Ended Unpaid Average Interest Recorded Principal Related Recorded Income December 31, 2015 Investment Balance Allowance Investment Recognized With no related allowance: Commercial $ $ $ $ Real estate: Commercial Residential Consumer Total With an allowance recorded: Commercial $ Real estate: Commercial Residential Consumer Total Commercial Real estate: Commercial Residential Consumer Total $ $ $ $ $ For the Year Ended Unpaid Average Interest Recorded Principal Related Recorded Income December 31, 2014 Investment Balance Allowance Investment Recognized With no related allowance: Commercial $ $ $ $ Real estate: Commercial Residential Consumer Total With an allowance recorded: Commercial $ $ Real estate: Commercial Residential Consumer Total Commercial Real estate: Commercial Residential Consumer Total $ $ $ $ $ |
Summary of changes in accretible yield and nonaccretible difference of acquired loans | Year ended December 31 2016 2015 2014 Beginning Balance, January 1 $ $ $ Reclassification from Nonaccretible Accretion Charge-offs Payments Ending Balance, December 31 $ $ $ |
Summary loans whose terms have been modified resulting in troubled debt restructurings | Pre-Modification Post-Modification Number Outstanding Recorded Outstanding Recorded December 31, 2016 of Contracts Investment Recorded Investment Investment Commercial $ $ $ Commercial real estate Residential mortgage Total $ $ $ Pre-Modification Post-Modification Number Outstanding Recorded Outstanding Recorded December 31, 2015 of Contracts Investment Recorded Investment Investment Commercial $ $ Commercial real estate $ Residential mortgage Total $ $ $ |
Off-balance sheet financial i32
Off-balance sheet financial instruments (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Off-balance sheet financial instruments | |
Summary of Contractual Amounts of Off-balance Sheet Commitments | December 31 2016 2015 Commitments to extend credit $ $ Unused portions of lines of credit Standby letters of credit $ $ |
Premises and equipment, net (Ta
Premises and equipment, net (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Premises and equipment, net | |
Summary of Premises and Equipment | December 31 2016 2015 Land $ $ Premises and leasehold improvements Furniture, fixtures and equipment Less: accumulated depreciation $ $ |
Summary of Future Minimum Rental Commitments Under Operating Leases | 2017 $ 2018 2019 2020 2021 Thereafter $ |
Intangible assets, net (Tables)
Intangible assets, net (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Intangible assets, net | |
Summary of Estimated Amortization Expense on Intangible Assets | 2017 $ 2018 2019 2020 2021 Thereafter $ |
Other assets (Tables)
Other assets (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Other assets. | |
Components of other assets | December 31, 2016 December 31, 2015 Other real estate owned $ $ Investment in residential housing program Mortgage servicing rights Bank owned life insurance Restricted equity securities Other assets Total $ $ |
Deposits (Tables)
Deposits (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Deposits. | |
Components of Interest-bearing and Noninterest-bearing Deposits | December 31 2016 2015 Interest-bearing deposits: Money market accounts $ $ Now accounts Savings accounts Time deposits less than $250 Time deposits $250 or more Total interest-bearing deposits Noninterest-bearing deposits Total deposits $ $ |
Schedule of Maturities of Time Deposits | 2017 $ 2018 2019 2020 2021 Thereafter $ |
Short-term borrowings (Tables)
Short-term borrowings (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Short-term borrowings | |
Summary of Short-term Borrowings | At and for the year ended December 31, 2016 Weighted Weighted Maximum Average Average Ending Average Month-End Rate for Rate at End Balance Balance Balance the Year of the Year Repurchase agreements FHLB advances $ $ $ % % $ $ $ % % At and for the year ended December 31, 2015 Weighted Weighted Maximum Average Average Ending Average Month-End Rate for Rate at End Balance Balance Balance the Year of the Year Repurchase agreements $ % FHLB advances $ $ $ % $ $ $ % % |
Long-term debt (Tables)
Long-term debt (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Long-term debt. | |
Schedule of Long-term Debt Consisting of Advances | Interest Rate Due Fixed Adjustable 2016 2015 February 2016 % $ February 2016 February 2017 September 2017 April 2018 December 2018 December 2019 % December 2019 December 2019 June 2020 December 2020 March 2023 $ $ |
Schedule of Maturities of Long-term Debt | 2017 $ 2018 2019 2020 2021 Thereafter $ |
Fair value of financial instr39
Fair value of financial instruments (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Fair value of financial instruments | |
Schedule of assets and liabilities measured at fair value on a recurring basis | Fair Value Measurement Using Quoted Prices in Significant Significant Active Markets for Other Observable Unobservable Identical Assets Inputs Inputs December 31, 2016 Amount (Level 1) (Level 2) (Level 3) U.S. Treasury securities $ $ U.S. Government-sponsored enterprises $ $ State and Municipals: Taxable Tax-exempt Mortgage-backed securities: U.S. Government agencies U.S. Government-sponsored enterprises Total $ $ $ $ Fair Value Measurement Using Quoted Prices in Significant Significant Active Markets for Other Observable Unobservable Identical Assets Inputs Inputs December 31, 2015 Amount (Level 1) (Level 2) (Level 3) U.S. Treasury securities $ $ $ U.S. Government-sponsored enterprises $ State and Municipals: Taxable Tax-exempt Mortgage-backed securities: U.S. Government agencies U.S. Government-sponsored enterprises Total $ $ $ $ |
Schedule of assets and liabilities measured at fair value on a nonrecurring basis | Fair Value Measurement Using Quoted Prices in Significant Significant Active Markets for Other Observable Unobservable Identical Assets Inputs Inputs December 31, 2016 Amount (Level 1) (Level 2) (Level 3) Impaired loans $ $ Other real estate owned $ $ Fair Value Measurement Using Quoted Prices in Significant Other Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs December 31, 2015 Amount (Level 1) (Level 2) (Level 3) Impaired loans $ $ Other real estate owned $ $ |
Additional quantitative information about assets measured at fair value on a nonrecurring basis | Quantitative Information about Level 3 Fair Value Measurements Fair Value Range December 31, 2016 Estimate Valuation Techniques Unobservable Input (Weighted Average) Impaired loans $ Appraisal of collateral Appraisal adjustments 18.0% to 97.0% (74.5)% Liquidation expenses 3.0% to 6.0% (5.3)% Other real estate owned $ Appraisal of collateral Appraisal adjustments 25.0% to 54.6% (43.1)% Liquidation expenses 3.0% to 6.0% (5.0)% Quantitative Information about Level 3 Fair Value Measurements Fair Value Range December 31, 2015 Estimate Valuation Techniques Unobservable Input (Weighted Average) Impaired loans $ Appraisal of collateral Appraisal adjustments 3.3% to 97.0% (61.7)% Liquidation expenses 3.0% to 6.0% (5.4)% Other real estate owned $ Appraisal of collateral Appraisal adjustments 20.0% to 77.3% (30.3)% Liquidation expenses 3.0% to 6.0% (5.0)% |
Carrying and fair values of financial instruments | Fair Value Hierarchy Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable Carrying Fair Assets Inputs Inputs December 31, 2016 Value Value (level 1) (level 2) (Level 3) Financial assets: Cash and cash equivalents $ $ $ Investment securities: Available-for-sale $ Held-to-maturity Loans held for sale Net loans $ Accrued interest receivable Mortgage servicing rights Restricted equity securities Total $ $ Financial liabilities: Deposits $ $ Short-term borrowings Long-term debt Accrued interest payable $ Total $ $ Fair Value Hierarchy Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable Carrying Fair Assets Inputs Inputs December 31, 2015 Value Value (level 1) (level 2) (Level 3) Financial assets: Cash and cash equivalents $ $ $ Investment securities: Available-for-sale $ $ Held-to-maturity Loans held for sale Net loans $ Accrued interest receivable Mortgage servicing rights Restricted equity securities Total $ $ Financial liabilities: Deposits $ $ Short-term borrowings Long-term debt Accrued interest payable $ Total $ $ |
Stock plans (Tables)
Stock plans (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Stock plans | |
Schedule of Activity Related to Restricted Stock | Year Ended December 31 2016 2015 2014 Nonvested, January 1 Granted shares Vested shares Forfeited shares Nonvested, December 31 |
Employee benefit plans (Tables)
Employee benefit plans (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Employee benefit plans | |
Summary of pension and postretirement life insurance plans | Pension Benefits December 31 2016 2015 Change in benefit obligation: Benefit obligation, beginning $ $ Interest cost Change in experience gain Change in assumptions gain Benefits paid Benefit obligation, ending Change in plan assets: Fair value of plan assets, beginning Actual return on plan assets Employer contributions Benefits paid Fair value of plan assets, ending Funded status at end of year $ $ |
Schedule of amounts recognized in balance sheet | Pension Benefits December 31 2016 2015 Liabilities $ $ Amounts recognized in the accumulated other comprehensive loss consist of: Net actuarial gain Deferred taxes Net amount recognized $ $ |
Components of net periodic benefit cost | Pension Benefits Years Ended December 31, 2016 2015 2014 Net periodic pension income: Interest cost $ $ $ Expected return on plan assets Amortization of unrecognized net loss Net periodic pension income: Other changes in plan assets and benefit obligations recognized in other comprehensive income (loss): Net loss (gain) Deferred tax Total recognized in other comprehensive income Total recognized in net period pension cost and other comprehensive income $ $ $ |
Schedule of weighted-average assumptions used to determine benefit obligations and related expenses | Pension Benefits December 31, Discount rate: Obligation % % % Expense Expected long-term return on plan assets % % % |
Schedule of Ppension plan weighted-average asset allocations | December 31, 2016 2015 Asset Category: Cash and cash equivalents % % Equity securities Corporate bonds U.S. Government securities % % |
Fair Value Measurement of pension plan assets | Quoted Prices in Active Markets Significant Significant for Identical Observable Observable Assets Inputs Inputs December 31, 2016 Total (Level 1) (Level 2) (Level 3) Cash $ $ $ Equity securities: U.S. large cap International Fixed income securities: U.S. Treasuries $ U.S. Government agencies Corporate bonds Total $ $ $ $ Quoted Prices in Active Markets Significant Significant for Identical Observable Observable Assets Inputs Inputs December 31, 2015 Total (Level 1) (Level 2) (Level 3) Cash $ $ $ Equity securities: U.S. large cap International Fixed income securities: U.S. Treasuries $ U.S. Government agencies Corporate bonds Total $ $ $ $ |
Schedule of expected benefit payments | Pension Benefits 2017 $ 2018 2019 2020 2021 Thereafter $ |
Income taxes (Tables)
Income taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income taxes | |
Current and Deferred Amounts of Provision for Income Taxes Expense (Benefit) | Year Ended December 31 2016 2015 2014 Current $ $ $ Deferred $ $ $ |
Components of Net Deferred Tax Asset | December 31 2016 2015 Deferred tax assets: Allowance for loan losses $ $ Defined benefit plan Deferred compensation Capital loss carry forward Other Total Deferred tax liabilities: Premises and equipment, net Merger related accounting Investment securities available-for-sale Other Total Net deferred tax asset $ $ |
Reconciliation of Effective Income Tax Expense | Year Ended December 31 2016 2015 2014 Federal income tax at statutory rate $ $ $ Tax exempt interest Bank owned life insurance income Residential housing program tax credits Other, net Total $ $ $ |
Parent Company financial stat43
Parent Company financial statements (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Parent Company financial statements | |
Condensed Balance Sheets | December 31 2016 2015 Assets: Cash and cash equivalents $ $ Investment in bank subsidiary Due from subsidiaries Total assets $ $ Liabilities and Stockholders’ Equity: Other liabilities $ $ Stockholders’ equity Total liabilities and stockholders’ equity $ $ |
Condensed Statements of Income and Comprehensive Income | Year Ended December 31 2016 2015 2014 Income: Dividends from subsidiaries $ $ $ Other income Total income Expense: Other expenses Total expenses Income before taxes and undistributed income Income tax benefit Income before undistributed income of subsidiaries Equity in undistributed net income (loss) of subsidiaries Net income $ $ $ Comprehensive Income $ $ $ |
Condensed Statements of Cash Flows | Year Ended December 31 2016 2015 2014 Cash flows from operating activities: Net income $ $ $ Adjustments: Net realized gains on sales of securities Undistributed net income of subsidiaries Increase in other assets Decrease in other liabilities Stock based compensation Deferred income tax expense Increase in due from subsidiaries Net cash provided by operating activities Cash flows from investing activities: Proceeds from sale of available-for-sale securities Net cash provided by investing activities Cash flows from financing activities: Redemption of common stock Retirement of stock options Reissuance of treasury stock Purchase of treasury stock Cash dividends paid Net cash used in financing activities (Decrease) increase in cash Cash at beginning of year Cash at end of year $ $ $ |
Regulatory matters (Tables)
Regulatory matters (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Deposits. | |
Schedule of Bank's Capital Amounts and Ratios | Minimum to be Well Capitalized under Minimum For Capital Prompt Corrective Actual Adequacy Purposes Action Provisions December 31, 2016 Amount Ratio Amount Ratio Amount Ratio Common equity Tier 1 capital to risk-weighted assets: Consolidated $ % $ % Peoples Bank $ % Tier 1 capital to risk-weighted assets: Consolidated Peoples Bank Total capital to risk-weighted assets: Consolidated Peoples Bank Tier 1 capital to average assets: Consolidated Peoples Bank $ % $ % $ % Minimum to be Well Capitalized under Minimum For Capital Prompt Corrective Actual Adequacy Purposes Action Provisions December 31, 2015 Amount Ratio Amount Ratio Amount Ratio Common equity Tier 1 capital to risk-weighted assets: Consolidated $ % $ % Peoples Bank $ % Tier 1 capital to risk-weighted assets: Consolidated Peoples Bank Total capital to risk-weighted assets: Consolidated Peoples Bank Tier 1 capital to average assets: Consolidated Peoples Bank $ % $ % $ % |
Comprehensive Income (Tables)
Comprehensive Income (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Comprehensive Income | |
Components of accumulated other comprehensive loss | December 31, 2016 2015 Net unrealized gain on investment securities available-for-sale $ $ Income tax Net of income taxes Benefit plan adjustments Income tax Net of income taxes Accumulated other comprehensive loss $ $ |
Other comprehensive income (loss) and related tax effects | Year Ended December 31, 2016 2015 2014 Unrealized (loss) gain on investment securities available-for-sale $ $ $ Net gain on the sale of investment securities available-for-sale(1) Benefit plans: Amortization of actuarial loss (gain)(2) Actuarial (loss) gain Net change in benefit plan liabilities Other comprehensive income gain (loss) before taxes Income tax expense (benefit) Other comprehensive income (loss) $ $ $ (1) Represents amounts reclassified out of accumulated comprehensive loss and included in gains on sale of investment securities on the consolidated statements of income. Represents amounts reclassified out of accumulated comprehensive loss and included in the computation of net periodic pension expense. Refer to Note 14 included in these consolidated financial statements. |
Summary of quarterly financia46
Summary of quarterly financial information (unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Summary of quarterly financial information (unaudited) | |
Summary of Quarterly Financial Information | 2016 Quarter Ended March 31 June 30 Sept. 30 Dec. 31 Interest income $ $ $ $ Interest expense Net interest income Provision for loan losses Net interest income after provision for loan losses Noninterest income Noninterest expense Income before income taxes Income tax expense Net income $ $ $ $ Per share data: Net income $ $ $ $ Cash dividends declared $ $ $ $ Average common shares outstanding 2015 Quarter Ended March 31 June 30 Sept. 30 Dec. 31 Interest income $ $ $ $ Interest expense Net interest income Provision for loan losses Net interest income after provision for loan losses Noninterest income Noninterest expense Income before income taxes Income tax expense Net income $ $ $ $ Per share data: Net income $ $ $ $ Cash dividends declared $ $ $ $ Average common shares outstanding |
Summary of significant accoun47
Summary of significant accounting policies - Additional Information (Details) | 12 Months Ended | ||
Dec. 31, 2016USD ($)segmentOffice | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Summary Of Significant Accounting Policies | |||
Date of incorporation | Nov. 30, 2013 | ||
Date of Merger | Jun. 28, 2013 | ||
Effective date of Merger Agreement | Dec. 1, 2013 | ||
Number of full-service community banking offices | Office | 25 | ||
Number of operating segments | segment | 1 | ||
Reclassification of prior period items amounts effect on net income | $ 0 | ||
Debt service coverage ratio | 1.2 | ||
Non performing loans past due period for Non-accrual status | 90 days | ||
Maximum days of consumer loans past due | 120 days | ||
Impairment losses on intangible assets | $ 0 | $ 0 | $ 0 |
Commitments subject to undue credit risk | 0 | ||
Advertising expense | $ 972,000 | 764,000 | $ 450,000 |
Income tax benefit recognition threshold | 50.00% | ||
Unrecognized tax benefit or accrued interest and penalties | $ 0 | ||
Income tax examination description | the Company recognizes accrued interest and penalties assessed as a result of a taxing authority examination through income tax expense. The Company files consolidated income tax returns in the United States of America and various states' jurisdictions. With limited exception, the Company is no longer subject to federal and state income tax examinations by taxing authorities for years before 2013. | ||
Unrecognized compensation cost related to stock options | $ 0 | $ 0 | |
Minimum | |||
Summary Of Significant Accounting Policies | |||
Contractual terms | 6 months | ||
Maximum | |||
Summary Of Significant Accounting Policies | |||
Finite useful life of intangible assets | 10 years | ||
Lease contracts as a percent of current assets | 1.00% | ||
Commercial Real Estate | |||
Summary Of Significant Accounting Policies | |||
Maximum loan to value percentage | 80.00% | ||
Residential Mortgage | Maximum | |||
Summary Of Significant Accounting Policies | |||
Maximum amortization period | 30 years |
Summary of significant accoun48
Summary of significant accounting policies - Estimated Useful Lives of Related Assets (Details) | 12 Months Ended |
Dec. 31, 2016 | |
Minimum | Premises and Leasehold Improvements | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated useful life | 7 years |
Minimum | Furniture, Fixtures and Equipment | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated useful life | 3 years |
Maximum | Premises and Leasehold Improvements | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated useful life | 40 years |
Maximum | Furniture, Fixtures and Equipment | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated useful life | 10 years |
Summary of significant accoun49
Summary of significant accounting policies - Schedule of Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Earnings per share | |||
Net Income (Numerator), Basic | $ 19,583 | $ 17,723 | $ 17,649 |
Average common shares outstanding (Denominator), Basic | 7,396,716 | 7,516,451 | 7,548,825 |
Earnings per share, Basic | $ 2.65 | $ 2.36 | $ 2.34 |
Net Income (Numerator), Diluted | $ 19,583 | $ 17,723 | $ 17,649 |
Average common shares outstanding (Denominator), Diluted | 7,396,716 | 7,516,451 | 7,561,982 |
Earnings per share, Diluted | $ 2.65 | $ 2.36 | $ 2.34 |
Cash and due from banks (Detail
Cash and due from banks (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Cash and due from banks | ||
Required reserve balances | $ 23,800 | $ 19,128 |
Investment securities - Amortiz
Investment securities - Amortized Cost and Fair Value of Investment Securities Aggregated by Investment Category (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Available-for-sale and Held-to-maturity securities | ||
Available-for-sale, Amortized Cost | $ 258,857 | |
Available-for-sale, Gross Unrealized Gains | 3,050 | |
Available-for-sale, Gross Unrealized Losses | 2,497 | |
Available-for-sale, Fair Value | 259,410 | |
Held-to-maturity, Amortized Cost | 10,517 | $ 12,109 |
Held-to-maturity, Gross Unrealized Gains | 264 | 513 |
Held-to-maturity, Gross Unrealized Losses | 67 | 16 |
Held-to-maturity, Fair value | 10,714 | 12,606 |
State and Municipals Tax-exempt Bonds | ||
Available-for-sale and Held-to-maturity securities | ||
Held-to-maturity, Amortized Cost | 6,862 | |
Held-to-maturity, Gross Unrealized Gains | 72 | |
Held-to-maturity, Gross Unrealized Losses | 67 | |
Held-to-maturity, Fair value | 6,867 | |
Mortgage-backed Securities, U.S. Government agencies | ||
Available-for-sale and Held-to-maturity securities | ||
Available-for-sale, Amortized Cost | 21,041 | 31,612 |
Available-for-sale, Gross Unrealized Gains | 48 | 73 |
Available-for-sale, Gross Unrealized Losses | 47 | 117 |
Available-for-sale, Fair Value | 21,042 | 31,568 |
Held-to-maturity, Amortized Cost | 68 | 84 |
Held-to-maturity, Gross Unrealized Gains | 1 | 1 |
Held-to-maturity, Fair value | 69 | 85 |
Mortgage-backed Securities, U.S. Government-sponsored enterprises | ||
Available-for-sale and Held-to-maturity securities | ||
Available-for-sale, Amortized Cost | 22,303 | 32,928 |
Available-for-sale, Gross Unrealized Gains | 48 | 119 |
Available-for-sale, Gross Unrealized Losses | 159 | 208 |
Available-for-sale, Fair Value | 22,192 | 32,839 |
Held-to-maturity, Amortized Cost | 3,587 | 5,160 |
Held-to-maturity, Gross Unrealized Gains | 191 | 326 |
Held-to-maturity, Fair value | 3,778 | 5,486 |
U.S. Government-sponsored enterprises state and municipals | ||
Available-for-sale and Held-to-maturity securities | ||
Available-for-sale, Amortized Cost | 82,314 | 68,831 |
Available-for-sale, Gross Unrealized Gains | 79 | 291 |
Available-for-sale, Gross Unrealized Losses | 1,480 | 62 |
Available-for-sale, Fair Value | 80,913 | 69,060 |
U.S. Treasury securities | ||
Available-for-sale and Held-to-maturity securities | ||
Available-for-sale, Amortized Cost | 7,570 | 10,030 |
Available-for-sale, Gross Unrealized Losses | 132 | 31 |
Available-for-sale, Fair Value | 7,438 | 9,999 |
Common Stock | ||
Available-for-sale and Held-to-maturity securities | ||
Available-for-sale, Amortized Cost | 280,342 | |
Available-for-sale, Gross Unrealized Gains | 5,133 | |
Available-for-sale, Gross Unrealized Losses | 540 | |
Available-for-sale, Fair Value | 284,935 | |
State and Municipals, Taxable | ||
Available-for-sale and Held-to-maturity securities | ||
Available-for-sale, Amortized Cost | 14,698 | 15,842 |
Available-for-sale, Gross Unrealized Gains | 566 | 735 |
Available-for-sale, Gross Unrealized Losses | 39 | 32 |
Available-for-sale, Fair Value | 15,225 | 16,545 |
State and Municipals, Tax-exempt | ||
Available-for-sale and Held-to-maturity securities | ||
Available-for-sale, Amortized Cost | 110,931 | |
Available-for-sale, Gross Unrealized Gains | 2,309 | |
Available-for-sale, Gross Unrealized Losses | 640 | |
Available-for-sale, Fair Value | $ 112,600 | |
Held-to-maturity, Amortized Cost | 6,865 | |
Held-to-maturity, Gross Unrealized Gains | 186 | |
Held-to-maturity, Gross Unrealized Losses | 16 | |
Held-to-maturity, Fair value | 7,035 | |
State and Municipals, Tax-exempt | Corporate Debt Securities | ||
Available-for-sale and Held-to-maturity securities | ||
Available-for-sale, Amortized Cost | 121,099 | |
Available-for-sale, Gross Unrealized Gains | 3,915 | |
Available-for-sale, Gross Unrealized Losses | 90 | |
Available-for-sale, Fair Value | $ 124,924 |
Investment securities - Additio
Investment securities - Additional Information (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016USD ($)security | Dec. 31, 2015USD ($)security | Dec. 31, 2014USD ($) | |
Available-for-sale and Held-to-maturity securities | |||
Unrealized gains, net | $ | $ 359 | $ 2,985 | |
Net of deferred income taxes | $ | 194 | 1,608 | |
Proceeds from the sale of investment securities available-for-sale | $ | 27,408 | 81,983 | $ 15,389 |
Gross realized gains | $ | 623 | 1,189 | 919 |
Gross realized losses | $ | 0 | 0 | 58 |
Carrying value of securities pledged | $ | $ 144,750 | $ 180,478 | |
Number of investment securities held | 163 | 88 | |
State and Municipals, Tax-exempt | |||
Available-for-sale and Held-to-maturity securities | |||
Number of investment securities held | 107 | 38 | |
Number of securities in continuous unrealized loss positions 12 months or longer | 2 | 4 | |
State and Municipals, Taxable | |||
Available-for-sale and Held-to-maturity securities | |||
Number of investment securities held | 2 | 1 | |
Number of securities in continuous unrealized loss positions 12 months or longer | 1 | ||
Peoples Bank | |||
Available-for-sale and Held-to-maturity securities | |||
Proceeds from the sale of investment securities available-for-sale | $ | 722 | ||
U.S. Treasury securities | |||
Available-for-sale and Held-to-maturity securities | |||
Number of investment securities held | 1 | ||
U.S. Treasury securities | State and Municipals, Tax-exempt | |||
Available-for-sale and Held-to-maturity securities | |||
Number of investment securities held | 2 | ||
U.S. Government-sponsored enterprises state and municipals | |||
Available-for-sale and Held-to-maturity securities | |||
Maximum percentage of stockholders' equity exceeded for securities of any individual issuer | 10.00% | ||
Number of investment securities held | 22 | 12 | |
Number of securities in continuous unrealized loss positions 12 months or longer | 9 | 7 | |
Other-than-temporary impairments recognized | $ | $ 0 | $ 0 | $ 0 |
Mortgage-backed Securities, Issued by Government Agencies | United States | |||
Available-for-sale and Held-to-maturity securities | |||
Number of investment securities held | 30 | 36 |
Investment securities - Maturit
Investment securities - Maturity Distribution of Debt Securities Classified as Available-for-Sale (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Investment securities | ||
Within one year | $ 37,123 | |
After one but within five years | 105,581 | |
After five but within ten years | 51,940 | |
After ten years | 21,531 | |
Available for sale securities | 216,175 | |
Mortgage-backed securities | 43,235 | |
Total | $ 259,410 | $ 284,935 |
Investment securities - Summary
Investment securities - Summary of Amortized Cost and Fair Value of Securities by Contractual Maturity (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Investment securities | ||
Amortized Cost, After ten years, Held to maturity | $ 6,862 | |
Amortized Cost, Held to maturity | 6,862 | |
Amortized Cost, Mortgage-backed securities, Held to maturity | 3,655 | |
Held-to-maturity, Amortized Cost | 10,517 | $ 12,109 |
Fair Value, After ten years, Held to maturity | 6,867 | |
Fair Value, Held to maturity | 6,867 | |
Fair Value, Mortgage-backed securities, Held to maturity | 3,847 | |
Held to maturity, Fair Value | $ 10,714 | $ 12,606 |
Investment securities - Addit55
Investment securities - Additional Information (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016USD ($)security | Dec. 31, 2015USD ($)security | Dec. 31, 2014USD ($) | |
Available-for-sale and Held-to-maturity securities | |||
Carrying value of securities pledged | $ | $ 144,750 | $ 180,478 | |
State and Municipals, Tax-exempt | |||
Available-for-sale and Held-to-maturity securities | |||
Number of securities in continuous unrealized loss positions 12 months or longer | 2 | 4 | |
State and Municipals, Taxable | |||
Available-for-sale and Held-to-maturity securities | |||
Number of securities in continuous unrealized loss positions 12 months or longer | 1 | ||
U.S. Government-sponsored enterprises state and municipals | |||
Available-for-sale and Held-to-maturity securities | |||
Number of securities in continuous unrealized loss positions 12 months or longer | 9 | 7 | |
Other-than-temporary impairments recognized | $ | $ 0 | $ 0 | $ 0 |
Investment securities - Fair Va
Investment securities - Fair Value and Unrealized Losses of Investment Securities in Continuous Unrealized Loss Position (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Available-for-sale and Held-to-maturity securities | ||
Less Than 12 Months, Fair Value | $ 145,428 | $ 98,260 |
Less Than 12 Months, Unrealized Losses | 2,470 | 340 |
12 Months or More, Fair Value | 4,434 | 13,991 |
12 Months or More, Unrealized Losses | 94 | 216 |
Total, Fair Value | 149,862 | 112,251 |
Total, Unrealized Losses | 2,564 | 556 |
State and Municipals, Taxable | ||
Available-for-sale and Held-to-maturity securities | ||
Less Than 12 Months, Fair Value | 1,035 | |
Less Than 12 Months, Unrealized Losses | 39 | |
12 Months or More, Fair Value | 532 | |
12 Months or More, Unrealized Losses | 32 | |
Total, Fair Value | 1,035 | 532 |
Total, Unrealized Losses | 39 | 32 |
State and Municipals, Tax-exempt | ||
Available-for-sale and Held-to-maturity securities | ||
Less Than 12 Months, Fair Value | 55,166 | 21,341 |
Less Than 12 Months, Unrealized Losses | 707 | 87 |
12 Months or More, Fair Value | 226 | 1,952 |
12 Months or More, Unrealized Losses | 19 | |
Total, Fair Value | 55,392 | 23,293 |
Total, Unrealized Losses | 707 | 106 |
U.S. Treasury securities | ||
Available-for-sale and Held-to-maturity securities | ||
Less Than 12 Months, Fair Value | 7,438 | 9,999 |
Less Than 12 Months, Unrealized Losses | 132 | 31 |
Total, Fair Value | 7,438 | 9,999 |
Total, Unrealized Losses | 132 | 31 |
U.S. Government-sponsored enterprises state and municipals | ||
Available-for-sale and Held-to-maturity securities | ||
Less Than 12 Months, Fair Value | 59,460 | 34,159 |
Less Than 12 Months, Unrealized Losses | 1,480 | 62 |
Total, Fair Value | 59,460 | 34,159 |
Total, Unrealized Losses | 1,480 | 62 |
Mortgage-backed Securities, U.S. Government agencies | ||
Available-for-sale and Held-to-maturity securities | ||
Less Than 12 Months, Fair Value | 5,917 | 15,114 |
Less Than 12 Months, Unrealized Losses | 27 | 56 |
12 Months or More, Fair Value | 1,496 | 5,477 |
12 Months or More, Unrealized Losses | 20 | 61 |
Total, Fair Value | 7,413 | 20,591 |
Total, Unrealized Losses | 47 | 117 |
Mortgage-backed Securities, U.S. Government-sponsored enterprises | ||
Available-for-sale and Held-to-maturity securities | ||
Less Than 12 Months, Fair Value | 16,412 | 17,647 |
Less Than 12 Months, Unrealized Losses | 85 | 104 |
12 Months or More, Fair Value | 2,712 | 6,030 |
12 Months or More, Unrealized Losses | 74 | 104 |
Total, Fair Value | 19,124 | 23,677 |
Total, Unrealized Losses | $ 159 | $ 208 |
Loans, net and allowance for 57
Loans, net and allowance for loan losses - Additional Information (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016USD ($)loan | Dec. 31, 2015USD ($)loan | Dec. 31, 2014USD ($)loan | |
Net deferred loan costs | $ 579 | $ 690 | |
Loans outstanding to directors, executive officers, principal stockholders or to their affiliates | 15,614 | 10,187 | |
Advances and repayments of loans receivable | 7,862 | 2,435 | |
Interest income recognized using the cash-basis method on impaired loans | $ 0 | $ 0 | $ 0 |
Number of distressed loans | loan | 10 | 29 | 29 |
Credit adjustment on distressed loans | $ 1,647 | $ 6,892 | $ 6,892 |
Total impaired loans | 13,579 | 12,635 | 14,591 |
Commercial | |||
Total impaired loans | 2,687 | 2,147 | 3,948 |
Real estate Commercial | |||
Total impaired loans | 7,157 | 5,374 | 6,457 |
Real estate Residential | |||
Total impaired loans | 3,580 | 4,966 | 4,059 |
Consumer | |||
Total impaired loans | $ 155 | $ 148 | $ 127 |
Loans, net and allowance for 58
Loans, net and allowance for loan losses - Major Classifications of Loans Outstanding (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | $ 1,532,965 | $ 1,340,865 | $ 1,209,894 |
Commercial | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 408,814 | 365,767 | 319,590 |
Real estate Commercial | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 700,144 | 567,277 | 493,481 |
Consumer | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | $ 134,226 | $ 101,603 | $ 74,369 |
Loans, net and allowance for 59
Loans, net and allowance for loan losses - Changes in Allowance for Loan Losses Account by Major Classification of Loans (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Allowance for loan losses: | ||||||||||||||
Beginning Balance | $ 12,975 | $ 10,338 | $ 12,975 | $ 10,338 | $ 8,651 | |||||||||
Charge-offs | (2,468) | (1,427) | (2,291) | |||||||||||
Recoveries | 454 | 364 | 454 | |||||||||||
Provisions | $ 1,400 | $ 1,200 | $ 1,200 | 1,200 | $ 1,300 | $ 900 | $ 750 | 750 | 5,000 | 3,700 | 3,524 | |||
Ending balance | 15,961 | 12,975 | 15,961 | 12,975 | 10,338 | |||||||||
Beginning Balance | 12,975 | 10,338 | 12,975 | 10,338 | 8,651 | |||||||||
Ending balance: individually evaluated for impairment | $ 1,942 | $ 2,140 | $ 2,682 | |||||||||||
Charge-offs | (2,468) | (1,427) | (2,291) | |||||||||||
Ending balance: collectively evaluated for impairment | 14,019 | 10,728 | 7,379 | |||||||||||
Recoveries | 454 | 364 | 454 | |||||||||||
Ending balance: loans acquired with deteriorated credit quality | 15,961 | 12,975 | 12,975 | 10,338 | 12,975 | 10,338 | 8,651 | 15,961 | 12,975 | 10,338 | ||||
Provisions | 1,400 | $ 1,200 | $ 1,200 | 1,200 | 1,300 | $ 900 | $ 750 | 750 | 5,000 | 3,700 | 3,524 | |||
Loans receivable: | ||||||||||||||
Total Loans | 1,532,965 | 1,340,865 | 1,209,894 | |||||||||||
Ending balance: individually evaluated for impairment | 11,242 | 10,267 | 11,807 | |||||||||||
Ending balance: collectively evaluated for impairment | 1,519,386 | 1,328,230 | 1,195,303 | |||||||||||
Ending balance | 2,337 | 2,368 | 2,784 | |||||||||||
Total Loans | 1,532,965 | 1,340,865 | 1,209,894 | |||||||||||
Ending balance | 15,961 | 12,975 | 15,961 | 12,975 | 10,338 | |||||||||
Ending balance: individually evaluated for impairment | 11,242 | 10,267 | 11,807 | |||||||||||
Ending balance: collectively evaluated for impairment | 1,519,386 | 1,328,230 | 1,195,303 | |||||||||||
Ending balance | 2,337 | 2,368 | 2,784 | |||||||||||
Loans Acquired with Deteriorated Credit Quality | ||||||||||||||
Allowance for loan losses: | ||||||||||||||
Beginning Balance | 107 | 277 | 107 | 277 | ||||||||||
Ending balance | 107 | 107 | 277 | |||||||||||
Beginning Balance | 107 | 277 | 107 | 277 | ||||||||||
Ending balance: loans acquired with deteriorated credit quality | 107 | 107 | 277 | 107 | 277 | 277 | 107 | 277 | ||||||
Loans receivable: | ||||||||||||||
Ending balance | 107 | 107 | 277 | |||||||||||
Commercial | ||||||||||||||
Allowance for loan losses: | ||||||||||||||
Beginning Balance | 3,042 | 2,321 | 3,042 | 2,321 | 2,008 | |||||||||
Charge-offs | (776) | (246) | (601) | |||||||||||
Recoveries | 86 | 77 | 9 | |||||||||||
Provisions | 1,447 | 890 | 905 | |||||||||||
Ending balance | 3,799 | 3,042 | 3,799 | 3,042 | 2,321 | |||||||||
Beginning Balance | 3,042 | 2,321 | 3,042 | 2,321 | 2,008 | |||||||||
Ending balance: individually evaluated for impairment | 225 | 759 | 1,072 | |||||||||||
Charge-offs | (776) | (246) | (601) | |||||||||||
Ending balance: collectively evaluated for impairment | 3,574 | 2,283 | 1,081 | |||||||||||
Recoveries | 86 | 77 | 9 | |||||||||||
Ending balance: loans acquired with deteriorated credit quality | 3,799 | 3,042 | 3,042 | 2,321 | 3,042 | 2,321 | 2,008 | 3,799 | 3,042 | 2,321 | ||||
Provisions | 1,447 | 890 | 905 | |||||||||||
Loans receivable: | ||||||||||||||
Total Loans | 408,814 | 365,767 | 319,590 | |||||||||||
Ending balance: individually evaluated for impairment | 1,724 | 1,196 | 2,595 | |||||||||||
Ending balance: collectively evaluated for impairment | 406,127 | 363,620 | 315,642 | |||||||||||
Ending balance | 963 | 951 | 1,353 | |||||||||||
Total Loans | 408,814 | 365,767 | 319,590 | |||||||||||
Ending balance | 3,799 | 3,042 | 3,799 | 3,042 | 2,321 | |||||||||
Ending balance: individually evaluated for impairment | 1,724 | 1,196 | 2,595 | |||||||||||
Ending balance: collectively evaluated for impairment | 406,127 | 363,620 | 315,642 | |||||||||||
Ending balance | 963 | 951 | 1,353 | |||||||||||
Commercial | Loans Acquired with Deteriorated Credit Quality | ||||||||||||||
Allowance for loan losses: | ||||||||||||||
Beginning Balance | 168 | 168 | ||||||||||||
Ending balance | 168 | |||||||||||||
Beginning Balance | 168 | 168 | ||||||||||||
Ending balance: loans acquired with deteriorated credit quality | 168 | 168 | 168 | 168 | ||||||||||
Loans receivable: | ||||||||||||||
Ending balance | 168 | |||||||||||||
Real estate Commercial | ||||||||||||||
Allowance for loan losses: | ||||||||||||||
Beginning Balance | 4,245 | 3,037 | 4,245 | 3,037 | 2,394 | |||||||||
Charge-offs | (858) | (325) | (500) | |||||||||||
Recoveries | 122 | 144 | 292 | |||||||||||
Provisions | 2,338 | 1,389 | 851 | |||||||||||
Ending balance | 5,847 | 4,245 | 5,847 | 4,245 | 3,037 | |||||||||
Beginning Balance | 4,245 | 3,037 | 4,245 | 3,037 | 2,394 | |||||||||
Ending balance: individually evaluated for impairment | 1,197 | 126 | 805 | |||||||||||
Charge-offs | (858) | (325) | (500) | |||||||||||
Ending balance: collectively evaluated for impairment | 4,650 | 4,012 | 2,125 | |||||||||||
Recoveries | 122 | 144 | 292 | |||||||||||
Ending balance: loans acquired with deteriorated credit quality | 5,847 | 4,245 | 4,245 | 3,037 | 4,245 | 3,037 | 2,394 | 5,847 | 4,245 | 3,037 | ||||
Provisions | 2,338 | 1,389 | 851 | |||||||||||
Loans receivable: | ||||||||||||||
Total Loans | 700,144 | 567,277 | 493,481 | |||||||||||
Ending balance: individually evaluated for impairment | 5,820 | 4,006 | 5,084 | |||||||||||
Ending balance: collectively evaluated for impairment | 692,987 | 561,903 | 487,024 | |||||||||||
Ending balance | 1,337 | 1,368 | 1,373 | |||||||||||
Total Loans | 700,144 | 567,277 | 493,481 | |||||||||||
Ending balance | 5,847 | 4,245 | 5,847 | 4,245 | 3,037 | |||||||||
Ending balance: individually evaluated for impairment | 5,820 | 4,006 | 5,084 | |||||||||||
Ending balance: collectively evaluated for impairment | 692,987 | 561,903 | 487,024 | |||||||||||
Ending balance | 1,337 | 1,368 | 1,373 | |||||||||||
Real estate Commercial | Loans Acquired with Deteriorated Credit Quality | ||||||||||||||
Allowance for loan losses: | ||||||||||||||
Beginning Balance | 107 | 107 | 107 | 107 | ||||||||||
Ending balance | 107 | 107 | 107 | |||||||||||
Beginning Balance | 107 | 107 | 107 | 107 | ||||||||||
Ending balance: loans acquired with deteriorated credit quality | 107 | 107 | 107 | 107 | 107 | 107 | 107 | 107 | ||||||
Loans receivable: | ||||||||||||||
Ending balance | 107 | 107 | 107 | |||||||||||
Real estate Residential | ||||||||||||||
Allowance for loan losses: | ||||||||||||||
Beginning Balance | 4,082 | 3,690 | 4,082 | 3,690 | 3,135 | |||||||||
Charge-offs | (339) | (523) | (804) | |||||||||||
Recoveries | 69 | 26 | 38 | |||||||||||
Provisions | 895 | 889 | 1,321 | |||||||||||
Ending balance | 4,707 | 4,082 | 4,707 | 4,082 | 3,690 | |||||||||
Beginning Balance | 4,082 | 3,690 | 4,082 | 3,690 | 3,135 | |||||||||
Ending balance: individually evaluated for impairment | 520 | 1,138 | 767 | |||||||||||
Charge-offs | (339) | (523) | (804) | |||||||||||
Ending balance: collectively evaluated for impairment | 4,187 | 2,944 | 2,921 | |||||||||||
Recoveries | 69 | 26 | 38 | |||||||||||
Ending balance: loans acquired with deteriorated credit quality | 4,707 | 4,082 | 4,082 | 3,690 | 4,082 | 3,690 | 3,135 | 4,707 | 4,082 | 3,690 | ||||
Provisions | 895 | 889 | 1,321 | |||||||||||
Loans receivable: | ||||||||||||||
Total Loans | 289,781 | 306,218 | 322,454 | |||||||||||
Ending balance: individually evaluated for impairment | 3,543 | 4,917 | 4,001 | |||||||||||
Ending balance: collectively evaluated for impairment | 286,201 | 301,252 | 318,395 | |||||||||||
Ending balance | 37 | 49 | 58 | |||||||||||
Total Loans | 289,781 | 306,218 | 322,454 | |||||||||||
Ending balance | 4,707 | 4,082 | 4,707 | 4,082 | 3,690 | |||||||||
Ending balance: individually evaluated for impairment | 3,543 | 4,917 | 4,001 | |||||||||||
Ending balance: collectively evaluated for impairment | 286,201 | 301,252 | 318,395 | |||||||||||
Ending balance | 37 | 49 | 58 | |||||||||||
Real estate Residential | Loans Acquired with Deteriorated Credit Quality | ||||||||||||||
Allowance for loan losses: | ||||||||||||||
Beginning Balance | 2 | 2 | ||||||||||||
Ending balance | 2 | |||||||||||||
Beginning Balance | 2 | 2 | ||||||||||||
Ending balance: loans acquired with deteriorated credit quality | 2 | 2 | 2 | 2 | ||||||||||
Loans receivable: | ||||||||||||||
Ending balance | 2 | |||||||||||||
Consumer | ||||||||||||||
Allowance for loan losses: | ||||||||||||||
Beginning Balance | 1,583 | 1,290 | 1,583 | 1,290 | 1,114 | |||||||||
Charge-offs | (495) | (333) | (386) | |||||||||||
Recoveries | 177 | 117 | 115 | |||||||||||
Provisions | 343 | 509 | 447 | |||||||||||
Ending balance | 1,608 | 1,583 | 1,608 | 1,583 | 1,290 | |||||||||
Beginning Balance | 1,583 | 1,290 | 1,583 | 1,290 | 1,114 | |||||||||
Ending balance: individually evaluated for impairment | 117 | 38 | ||||||||||||
Charge-offs | (495) | (333) | (386) | |||||||||||
Ending balance: collectively evaluated for impairment | 1,608 | 1,466 | 1,252 | |||||||||||
Recoveries | 177 | 117 | 115 | |||||||||||
Ending balance: loans acquired with deteriorated credit quality | 1,608 | 1,583 | 1,583 | $ 1,290 | 1,583 | 1,290 | 1,114 | 1,608 | 1,583 | 1,290 | ||||
Provisions | 343 | 509 | 447 | |||||||||||
Loans receivable: | ||||||||||||||
Total Loans | 134,226 | 101,603 | 74,369 | |||||||||||
Ending balance: individually evaluated for impairment | 155 | 148 | 127 | |||||||||||
Ending balance: collectively evaluated for impairment | 134,071 | 101,455 | 74,242 | |||||||||||
Total Loans | 134,226 | 101,603 | 74,369 | |||||||||||
Ending balance | $ 1,608 | 1,583 | 1,608 | 1,583 | $ 1,290 | |||||||||
Ending balance: individually evaluated for impairment | 155 | 148 | 127 | |||||||||||
Ending balance: collectively evaluated for impairment | $ 134,071 | 101,455 | $ 74,242 | |||||||||||
Unallocated | ||||||||||||||
Allowance for loan losses: | ||||||||||||||
Beginning Balance | 23 | 23 | ||||||||||||
Provisions | (23) | 23 | ||||||||||||
Ending balance | 23 | 23 | ||||||||||||
Beginning Balance | 23 | 23 | ||||||||||||
Ending balance: collectively evaluated for impairment | 23 | |||||||||||||
Ending balance: loans acquired with deteriorated credit quality | $ 23 | 23 | 23 | 23 | $ 23 | |||||||||
Provisions | $ (23) | 23 | ||||||||||||
Loans receivable: | ||||||||||||||
Ending balance | $ 23 | $ 23 |
Loans, net and allowance for 60
Loans, net and allowance for loan losses - Allocation of Allowance for Loan Losses and Related Loans by Major Classification of Loans (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Allowance for loan losses: | ||||
Ending balance | $ 15,961 | $ 12,975 | $ 10,338 | $ 8,651 |
Ending balance: individually evaluated for impairment | 1,942 | 2,140 | 2,682 | |
Ending balance: collectively evaluated for impairment | 14,019 | 10,728 | 7,379 | |
Loans receivable: | ||||
Ending balance | 1,532,965 | 1,340,865 | 1,209,894 | |
Ending balance: individually evaluated for impairment | 11,242 | 10,267 | 11,807 | |
Ending balance: collectively evaluated for impairment | 1,519,386 | 1,328,230 | 1,195,303 | |
Ending balance | 2,337 | 2,368 | 2,784 | |
Loans Acquired with Deteriorated Credit Quality | ||||
Allowance for loan losses: | ||||
Ending balance | 107 | 277 | ||
Commercial | ||||
Allowance for loan losses: | ||||
Ending balance | 3,799 | 3,042 | 2,321 | 2,008 |
Ending balance: individually evaluated for impairment | 225 | 759 | 1,072 | |
Ending balance: collectively evaluated for impairment | 3,574 | 2,283 | 1,081 | |
Loans receivable: | ||||
Ending balance | 408,814 | 365,767 | 319,590 | |
Ending balance: individually evaluated for impairment | 1,724 | 1,196 | 2,595 | |
Ending balance: collectively evaluated for impairment | 406,127 | 363,620 | 315,642 | |
Ending balance | 963 | 951 | 1,353 | |
Commercial | Loans Acquired with Deteriorated Credit Quality | ||||
Allowance for loan losses: | ||||
Ending balance | 168 | |||
Real estate Commercial | ||||
Allowance for loan losses: | ||||
Ending balance | 5,847 | 4,245 | 3,037 | 2,394 |
Ending balance: individually evaluated for impairment | 1,197 | 126 | 805 | |
Ending balance: collectively evaluated for impairment | 4,650 | 4,012 | 2,125 | |
Loans receivable: | ||||
Ending balance | 700,144 | 567,277 | 493,481 | |
Ending balance: individually evaluated for impairment | 5,820 | 4,006 | 5,084 | |
Ending balance: collectively evaluated for impairment | 692,987 | 561,903 | 487,024 | |
Ending balance | 1,337 | 1,368 | 1,373 | |
Real estate Commercial | Loans Acquired with Deteriorated Credit Quality | ||||
Allowance for loan losses: | ||||
Ending balance | 107 | 107 | ||
Consumer | ||||
Allowance for loan losses: | ||||
Ending balance | 1,608 | 1,583 | 1,290 | $ 1,114 |
Ending balance: individually evaluated for impairment | 117 | 38 | ||
Ending balance: collectively evaluated for impairment | 1,608 | 1,466 | 1,252 | |
Loans receivable: | ||||
Ending balance | 134,226 | 101,603 | 74,369 | |
Ending balance: individually evaluated for impairment | 155 | 148 | 127 | |
Ending balance: collectively evaluated for impairment | $ 134,071 | 101,455 | $ 74,242 | |
Unallocated | ||||
Allowance for loan losses: | ||||
Ending balance | 23 | |||
Ending balance: collectively evaluated for impairment | $ 23 |
Loans, net and allowance for 61
Loans, net and allowance for loan losses - Major Classification of Loans Portfolio Summarized by Credit Quality (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | $ 1,532,965 | $ 1,340,865 | $ 1,209,894 |
Commercial | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 408,814 | 365,767 | 319,590 |
Real estate Commercial | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 700,144 | 567,277 | 493,481 |
Real estate Residential | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 289,781 | 306,218 | 322,454 |
Consumer | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 134,226 | 101,603 | $ 74,369 |
Pass | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 1,490,501 | 1,294,097 | |
Pass | Commercial | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 398,867 | 357,894 | |
Pass | Real estate Commercial | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 674,914 | 538,130 | |
Pass | Real estate Residential | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 282,737 | 296,587 | |
Pass | Consumer | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 133,983 | 101,486 | |
Special Mention | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 16,847 | 14,699 | |
Special Mention | Commercial | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 6,222 | 3,566 | |
Special Mention | Real estate Commercial | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 10,392 | 10,150 | |
Special Mention | Real estate Residential | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 233 | 983 | |
Substandard | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 25,617 | 32,069 | |
Substandard | Commercial | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 3,725 | 4,307 | |
Substandard | Real estate Commercial | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 14,838 | 18,997 | |
Substandard | Real estate Residential | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 6,811 | 8,648 | |
Substandard | Consumer | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | $ 243 | $ 117 |
Loans, net and allowance for 62
Loans, net and allowance for loan losses - Information Concerning Nonaccrual Loans by Major Loan Classification (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Financing Receivable, Recorded Investment, Past Due | ||
Nonaccrual loans, Total | $ 11,108 | $ 10,371 |
Commercial | ||
Financing Receivable, Recorded Investment, Past Due | ||
Nonaccrual loans, Total | 934 | 1,632 |
Real estate Commercial | ||
Financing Receivable, Recorded Investment, Past Due | ||
Nonaccrual loans, Total | 7,016 | 3,859 |
Real estate Residential | ||
Financing Receivable, Recorded Investment, Past Due | ||
Nonaccrual loans, Total | 3,003 | 4,732 |
Consumer | ||
Financing Receivable, Recorded Investment, Past Due | ||
Nonaccrual loans, Total | $ 155 | $ 148 |
Loans, net and allowance for 63
Loans, net and allowance for loan losses - Major Classification of Loans by Past Due Status (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | $ 21,260 | $ 18,805 | |
Current | 1,511,705 | 1,322,060 | |
Total Loans | 1,532,965 | 1,340,865 | $ 1,209,894 |
Loans > 90 Days and Accruing | 844 | 763 | |
30-59 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 8,093 | 6,086 | |
60-89 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 1,215 | 1,585 | |
Greater than 90 Days | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 11,952 | 11,134 | |
Commercial | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 1,258 | 1,758 | |
Current | 407,556 | 364,009 | |
Total Loans | 408,814 | 365,767 | 319,590 |
Commercial | 30-59 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 249 | 126 | |
Commercial | 60-89 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 75 | ||
Commercial | Greater than 90 Days | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 934 | 1,632 | |
Real estate Commercial | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 12,325 | 5,388 | |
Current | 687,819 | 561,889 | |
Total Loans | 700,144 | 567,277 | 493,481 |
Real estate Commercial | 30-59 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 4,782 | 1,364 | |
Real estate Commercial | 60-89 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 527 | 165 | |
Real estate Commercial | Greater than 90 Days | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 7,016 | 3,859 | |
Real estate Residential | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 6,015 | 10,215 | |
Current | 283,766 | 296,003 | |
Total Loans | 289,781 | 306,218 | 322,454 |
Loans > 90 Days and Accruing | 558 | 525 | |
Real estate Residential | 30-59 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 2,100 | 3,891 | |
Real estate Residential | 60-89 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 354 | 1,067 | |
Real estate Residential | Greater than 90 Days | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 3,561 | 5,257 | |
Consumer | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 1,662 | 1,444 | |
Current | 132,564 | 100,159 | |
Total Loans | 134,226 | 101,603 | $ 74,369 |
Loans > 90 Days and Accruing | 286 | 238 | |
Consumer | 30-59 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 962 | 705 | |
Consumer | 60-89 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 259 | 353 | |
Consumer | Greater than 90 Days | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | $ 441 | $ 386 |
Loans, net and allowance for 64
Loans, net and allowance for loan losses - Summarize Information in Concerning to Impaired Loans (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Financing Receivable, Impaired | |||
Recorded Investment, With no related allowance, Total | $ 7,128 | $ 7,162 | $ 8,066 |
Unpaid Principal Balance, With no related allowance, Total | 8,774 | 9,390 | 10,714 |
Average Recorded Investment, With no related allowance, Total | 8,041 | 6,923 | 13,438 |
Interest Income Recognized, With no related allowance, Total | 154 | 186 | 265 |
Recorded Investment, With an allowance recorded, Total | 6,451 | 5,473 | 6,525 |
Unpaid Principal Balance, With an allowance recorded, Total | 6,452 | 5,473 | 6,525 |
Related Allowance, With an allowance recorded, Total | 1,942 | 2,247 | 2,959 |
Average Recorded Investment, With an allowance recorded, Total | 4,460 | 7,737 | 4,680 |
Interest Income Recognized, With an allowance recorded, Total | 9 | 156 | 97 |
Recorded Investment, Total | 13,579 | 12,635 | 14,591 |
Unpaid Principal Balance, Total | 15,226 | 14,863 | 17,239 |
Related Allowance, With an allowance recorded, Total | 1,942 | 2,247 | 2,959 |
Average Recorded Investment, Total | 12,501 | 14,660 | 18,118 |
Interest Income Recognized, Total | 163 | 342 | 362 |
Commercial | |||
Financing Receivable, Impaired | |||
Recorded Investment, With no related allowance, Total | 2,404 | 1,352 | 2,379 |
Unpaid Principal Balance, With no related allowance, Total | 3,213 | 2,720 | 4,084 |
Average Recorded Investment, With no related allowance, Total | 1,461 | 1,848 | 2,669 |
Interest Income Recognized, With no related allowance, Total | 48 | 87 | 141 |
Recorded Investment, With an allowance recorded, Total | 283 | 795 | 1,569 |
Unpaid Principal Balance, With an allowance recorded, Total | 283 | 795 | 1,569 |
Related Allowance, With an allowance recorded, Total | 225 | 759 | 1,240 |
Average Recorded Investment, With an allowance recorded, Total | 859 | 1,680 | 1,787 |
Interest Income Recognized, With an allowance recorded, Total | 40 | 58 | |
Recorded Investment, Total | 2,687 | 2,147 | 3,948 |
Unpaid Principal Balance, Total | 3,496 | 3,515 | 5,653 |
Related Allowance, With an allowance recorded, Total | 225 | 759 | 1,240 |
Average Recorded Investment, Total | 2,320 | 3,528 | 4,456 |
Interest Income Recognized, Total | 48 | 127 | 199 |
Real estate Commercial | |||
Financing Receivable, Impaired | |||
Recorded Investment, With no related allowance, Total | 2,364 | 2,731 | 2,932 |
Unpaid Principal Balance, With no related allowance, Total | 3,018 | 3,408 | 3,690 |
Average Recorded Investment, With no related allowance, Total | 4,300 | 2,394 | 7,944 |
Interest Income Recognized, With no related allowance, Total | 71 | 95 | 120 |
Recorded Investment, With an allowance recorded, Total | 4,793 | 2,643 | 3,525 |
Unpaid Principal Balance, With an allowance recorded, Total | 4,793 | 2,643 | 3,525 |
Related Allowance, With an allowance recorded, Total | 1,197 | 233 | 912 |
Average Recorded Investment, With an allowance recorded, Total | 2,366 | 4,155 | 2,293 |
Interest Income Recognized, With an allowance recorded, Total | 2 | 86 | 28 |
Recorded Investment, Total | 7,157 | 5,374 | 6,457 |
Unpaid Principal Balance, Total | 7,811 | 6,051 | 7,215 |
Related Allowance, With an allowance recorded, Total | 1,197 | 233 | 912 |
Average Recorded Investment, Total | 6,666 | 6,549 | 10,237 |
Interest Income Recognized, Total | 73 | 181 | 148 |
Real estate Residential | |||
Financing Receivable, Impaired | |||
Recorded Investment, With no related allowance, Total | 2,205 | 3,048 | 2,672 |
Unpaid Principal Balance, With no related allowance, Total | 2,388 | 3,231 | 2,857 |
Average Recorded Investment, With no related allowance, Total | 2,133 | 2,664 | 2,731 |
Interest Income Recognized, With no related allowance, Total | 35 | 4 | 4 |
Recorded Investment, With an allowance recorded, Total | 1,375 | 1,918 | 1,387 |
Unpaid Principal Balance, With an allowance recorded, Total | 1,376 | 1,918 | 1,387 |
Related Allowance, With an allowance recorded, Total | 520 | 1,138 | 769 |
Average Recorded Investment, With an allowance recorded, Total | 1,185 | 1,776 | 590 |
Interest Income Recognized, With an allowance recorded, Total | 7 | 30 | 10 |
Recorded Investment, Total | 3,580 | 4,966 | 4,059 |
Unpaid Principal Balance, Total | 3,764 | 5,149 | 4,244 |
Related Allowance, With an allowance recorded, Total | 520 | 1,138 | 769 |
Average Recorded Investment, Total | 3,318 | 4,440 | 3,321 |
Interest Income Recognized, Total | 42 | 34 | 14 |
Consumer | |||
Financing Receivable, Impaired | |||
Recorded Investment, With no related allowance, Total | 155 | 31 | 83 |
Unpaid Principal Balance, With no related allowance, Total | 155 | 31 | 83 |
Average Recorded Investment, With no related allowance, Total | 147 | 17 | 94 |
Recorded Investment, With an allowance recorded, Total | 117 | 44 | |
Unpaid Principal Balance, With an allowance recorded, Total | 117 | 44 | |
Related Allowance, With an allowance recorded, Total | 117 | 38 | |
Average Recorded Investment, With an allowance recorded, Total | 50 | 126 | 10 |
Interest Income Recognized, With an allowance recorded, Total | 1 | ||
Recorded Investment, Total | 155 | 148 | 127 |
Unpaid Principal Balance, Total | 155 | 148 | 127 |
Related Allowance, With an allowance recorded, Total | 117 | 38 | |
Average Recorded Investment, Total | $ 197 | $ 143 | 104 |
Interest Income Recognized, Total | $ 1 |
Loans, net and allowance for 65
Loans, net and allowance for loan losses - Summary of Changes in Accretible Yield and Nonaccretible Difference of Acquired Loans (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Loans, net and allowance for loan losses | |||
Beginning Balance, Accretible | $ 60 | $ 895 | |
Additions, Accretible | $ 554 | ||
Accretion, Accretible | (369) | $ (60) | (280) |
Charge-offs, Accretible | (398) | ||
Payments, Accretible | (157) | ||
Ending Balance, Accretible | $ 185 | $ 60 |
Loans, net and allowance for 66
Loans, net and allowance for loan losses - Loans Modified Resulting in Troubled Debt Restructurings (Details) | 12 Months Ended | ||
Dec. 31, 2016USD ($)contract | Dec. 31, 2015USD ($)contract | Dec. 31, 2014USD ($)contract | |
Loans in the formal process of foreclosure | $ 1,529,000 | $ 564,000 | |
Number of loans modified | contract | 3 | 9 | 3 |
Pre-Modification Outstanding Recorded Investment | $ 1,716,000 | $ 657,000 | |
Post-Modification Outstanding Recorded Investment | 1,366,000 | 657,000 | |
Recorded Investment | 207,000 | 538,000 | |
Number of defaults on loans restructured | 1 | 2 | |
Loans modified as troubled debt restructuring | 43,000 | 166,000 | |
Loans receivable, related parties, considered as nonaccrual, past due or restructured or potential credit risk | $ 1,909,000 | $ 2,861,000 | $ 2,933,000 |
Commercial | |||
Number of loans modified | contract | 1 | 1 | |
Pre-Modification Outstanding Recorded Investment | $ 1,500,000 | $ 98,000 | |
Post-Modification Outstanding Recorded Investment | 1,150,000 | $ 98,000 | |
Recorded Investment | 1,150,000 | ||
Real estate Commercial | |||
Number of loans modified | contract | 1 | ||
Pre-Modification Outstanding Recorded Investment | $ 216,000 | $ 58,000 | |
Post-Modification Outstanding Recorded Investment | 58,000 | ||
Recorded Investment | $ 54,000 | ||
Real estate Residential | |||
Number of loans modified | contract | 2 | 7 | |
Pre-Modification Outstanding Recorded Investment | $ 501,000 | ||
Post-Modification Outstanding Recorded Investment | $ 216,000 | 501,000 | |
Recorded Investment | $ 207,000 | $ 484,000 |
Off-balance sheet financial i67
Off-balance sheet financial instruments - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Off-balance sheet financial instruments | ||
Allowance recorded under off balance sheet credit losses during the period | $ 58 | $ 47 |
Expiration period of standby letters | 12 months | |
Amount of standby letters of credit | $ 27,072 | $ 20,211 |
Off-balance sheet financial i68
Off-balance sheet financial instruments - Summary of Contractual Amounts of Off-balance Sheet Commitments (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Off-balance sheet financial instruments | ||
Commitments to extend credit | $ 235,878 | $ 257,011 |
Unused portions of lines of credit | 57,784 | 52,794 |
Standby letters of credit | 31,051 | 20,017 |
Amounts of off-balance Sheet commitments | $ 324,713 | $ 329,822 |
Premises and equipment, net - S
Premises and equipment, net - Summary of Premises and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | $ 55,386 | $ 48,622 |
Less: accumulated depreciation | 22,126 | 20,465 |
Property, Plant and Equipment, Net, Total | 33,260 | 28,157 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | 5,535 | 5,419 |
Premises and Leasehold Improvements | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | 38,604 | 33,177 |
Furniture, Fixtures and Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | $ 11,247 | $ 10,026 |
Premises and equipment, net - A
Premises and equipment, net - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation of premises and equipment | $ 1,661 | $ 1,595 | $ 1,671 |
Rent expense | $ 416 | $ 397 | $ 343 |
Minimum | |||
Property, Plant and Equipment [Line Items] | |||
Leases extension period | 1 year | ||
Maximum | |||
Property, Plant and Equipment [Line Items] | |||
Leases extension period | 10 years |
Premises and equipment, net -71
Premises and equipment, net - Summary of Future Minimum Rental Commitments Under Operating Leases (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
2,015 | $ 474 |
2,016 | 454 |
2,017 | 438 |
2,018 | 404 |
2,019 | 365 |
Thereafter | 1,465 |
Future minimum annual rent commitments under various operating leases | $ 3,600 |
Intangible assets, net - Additi
Intangible assets, net - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Finite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount of intangible assets | $ 1,091 | $ 1,091 | |
Amortization of intangibles | 1,186 | 1,195 | $ 1,334 |
Core Deposit | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount of intangible assets | 8,146 | 8,146 | |
Accumulated amortization on intangible assets | 4,958 | 3,957 | |
Trade Name | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount of intangible assets | 203 | 203 | |
Accumulated amortization on intangible assets | $ 102 | $ 73 |
Intangible assets, net - Summar
Intangible assets, net - Summary of Estimated Amortization Expense on Intangible Assets (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |
2,015 | $ 1,034 |
2,016 | 882 |
2,017 | 730 |
2,018 | 606 |
2,019 | 491 |
Thereafter | $ 468 |
Other assets - Components of Ot
Other assets - Components of Other Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Other assets. | ||
Other real estate owned | $ 393 | $ 957 |
Investment in residential housing program | 8,312 | 6,744 |
Mortgage servicing rights | 698 | 465 |
Bank owned life insurance | 33,073 | 30,782 |
Restricted equity securities | 7,051 | 5,403 |
Other assets | 15,974 | 14,136 |
Total | $ 65,501 | $ 58,487 |
Other assets - Unpaid Principal
Other assets - Unpaid Principal Balances (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Other assets. | ||
Unpaid principal balances of mortgage loans serviced for others | $ 171,034 | $ 168,198 |
Deposits - Components of Intere
Deposits - Components of Interest-bearing and Noninterest-bearing Deposits (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Deposits. | ||
Money market accounts | $ 224,414 | $ 197,258 |
Now accounts | 330,914 | 279,004 |
Savings accounts | 394,033 | 386,593 |
Time deposits less than $100 | 233,513 | 237,176 |
Time deposits $100 or more | 52,197 | 34,801 |
Interest-bearing Deposit Liabilities, Total | 1,235,071 | 1,134,832 |
Noninterest-bearing deposits | 353,686 | 320,978 |
Total deposits | $ 1,588,757 | $ 1,455,810 |
Deposits - Schedule of Maturiti
Deposits - Schedule of Maturities of Time Deposits (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Deposits. | |
2,015 | $ 166,637 |
2,016 | 45,695 |
2,017 | 14,466 |
2,018 | 23,860 |
2,019 | 18,860 |
Thereafter | 16,192 |
Total | $ 285,710 |
Deposits - Additional Informati
Deposits - Additional Information (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Deposits. | ||
Aggregate amount of deposits reclassified as loans | $ 194 | $ 187 |
Short-term borrowings - Additio
Short-term borrowings - Additional Information (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Peoples Bank | |
Short-term Debt | |
Maximum borrowing capacity | $ 599,435 |
Outstanding amount in borrowings | $ 140,826 |
Repurchase Agreements | FHLB Advances | |
Short-term Debt | |
Short term debt, Description | Securities sold under agreements to repurchase and FHLB advances generally represent overnight or less than 30-day borrowings. |
Short-term borrowings - Summary
Short-term borrowings - Summary of Short-term Borrowings (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Short-term Debt | ||
Short-term borrowings | $ 82,700 | $ 38,325 |
Short-term borrowings, Average Balance | 67,553 | 13,480 |
Short-term borrowings, Maximum Month-End Balance | $ 86,300 | $ 54,425 |
Short-term borrowings, Weighted Average Rate for the Year | 0.60% | 0.39% |
Short-term borrowings, Weighted Average Rate at end of the Year | 0.74% | 0.43% |
FHLB Advances | ||
Short-term Debt | ||
Short-term borrowings | $ 82,700 | $ 38,325 |
Short-term borrowings, Average Balance | 67,553 | 13,458 |
Short-term borrowings, Maximum Month-End Balance | $ 86,300 | $ 54,425 |
Short-term borrowings, Weighted Average Rate for the Year | 0.60% | 0.39% |
Short-term borrowings, Weighted Average Rate at end of the Year | 0.74% | 0.43% |
Repurchase Agreements | ||
Short-term Debt | ||
Short-term borrowings, Average Balance | $ 22 | |
Short-term borrowings, Weighted Average Rate for the Year | 1.11% |
Long-term debt - Schedule of Lo
Long-term debt - Schedule of Long-term Debt Consisting of Advances (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Debt Instrument [Line Items] | ||
Long-term debt | $ 58,134 | $ 60,354 |
November 2,015 | ||
Debt Instrument [Line Items] | ||
Long-term Debt, Percentage Bearing Fixed Interest, Percentage Rate | 4.86% | |
Long-term debt | 23 | |
February 2,016 | ||
Debt Instrument [Line Items] | ||
Long-term Debt, Percentage Bearing Fixed Interest, Percentage Rate | 4.86% | |
Long-term debt | 23 | |
February 2,016 | ||
Debt Instrument [Line Items] | ||
Long-term Debt, Percentage Bearing Fixed Interest, Percentage Rate | 4.99% | |
Long-term debt | $ 77 | 510 |
February 2,017 | ||
Debt Instrument [Line Items] | ||
Long-term Debt, Percentage Bearing Fixed Interest, Percentage Rate | 2.36% | |
Long-term debt | $ 6,500 | 6,500 |
September 2,017 | ||
Debt Instrument [Line Items] | ||
Long-term Debt, Percentage Bearing Fixed Interest, Percentage Rate | 3.83% | |
Long-term debt | $ 156 | 269 |
April 2,018 | ||
Debt Instrument [Line Items] | ||
Long-term Debt, Percentage Bearing Fixed Interest, Percentage Rate | 1.27% | |
Long-term debt | $ 10,000 | 10,000 |
December 2,019 | ||
Debt Instrument [Line Items] | ||
Long-term Debt, Percentage Bearing Variable Interest, Percentage Rate | 2.51% | |
Long-term debt | $ 3,000 | 3,000 |
December 2,019 | ||
Debt Instrument [Line Items] | ||
Long-term Debt, Percentage Bearing Variable Interest, Percentage Rate | 2.20% | |
Long-term debt | $ 6,300 | 6,300 |
December 2,019 | ||
Debt Instrument [Line Items] | ||
Long-term Debt, Percentage Bearing Fixed Interest, Percentage Rate | 1.62% | |
Long-term debt | $ 10,000 | 10,000 |
June 2,020 | ||
Debt Instrument [Line Items] | ||
Long-term Debt, Percentage Bearing Fixed Interest, Percentage Rate | 1.74% | |
Long-term debt | $ 5,000 | 5,000 |
December 2,020 | ||
Debt Instrument [Line Items] | ||
Long-term Debt, Percentage Bearing Fixed Interest, Percentage Rate | 1.84% | |
Long-term debt | $ 5,000 | 5,000 |
March 2,023 | ||
Debt Instrument [Line Items] | ||
Long-term Debt, Percentage Bearing Fixed Interest, Percentage Rate | 4.69% | |
Long-term debt | $ 12,101 | $ 13,729 |
Long-term debt - Schedule of Ma
Long-term debt - Schedule of Maturities of Long-term Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Long-term debt. | ||
2,015 | $ 8,400 | |
2,016 | 11,828 | |
2,017 | 21,174 | |
2,018 | 11,963 | |
2,019 | 2,058 | |
Thereafter | 2,711 | |
Long-term Debt, Total | $ 58,134 | $ 60,354 |
Long-term debt - Additional Inf
Long-term debt - Additional Information (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Debt Instrument [Line Items] | |
Long-term debt, fixed rates amount | $ 48,834 |
Long-term debt, adjustable rates amount | $ 9,300 |
Long-term debt, Libor interest rate description | three-month Libor plus 1.21% to plus 1.57% |
Minimum | |
Debt Instrument [Line Items] | |
Long-term debt, Libor interest rate percentage | 1.21% |
Maximum | |
Debt Instrument [Line Items] | |
Long-term debt, Libor interest rate percentage | 1.57% |
Fair value of financial instr84
Fair value of financial instruments - Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets measured at fair value | $ 259,410 | $ 284,935 |
U.S. Treasury securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets measured at fair value | 7,438 | 9,999 |
U.S. Government-sponsored enterprises state and municipals | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets measured at fair value | 80,913 | 69,060 |
State and Municipals, Taxable | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets measured at fair value | 15,225 | 16,545 |
State and Municipals, Tax-exempt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets measured at fair value | 112,600 | 124,924 |
Mortgage-backed Securities, U.S. Government agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets measured at fair value | 21,042 | 31,568 |
Mortgage-backed Securities, U.S. Government-sponsored enterprises | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets measured at fair value | 22,192 | 32,839 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets measured at fair value | 7,438 | 9,999 |
Level 1 | U.S. Treasury securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets measured at fair value | 7,438 | 9,999 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets measured at fair value | 251,972 | 274,936 |
Level 2 | U.S. Government-sponsored enterprises state and municipals | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets measured at fair value | 80,913 | 69,060 |
Level 2 | State and Municipals, Taxable | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets measured at fair value | 15,225 | 16,545 |
Level 2 | State and Municipals, Tax-exempt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets measured at fair value | 112,600 | 124,924 |
Level 2 | Mortgage-backed Securities, U.S. Government agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets measured at fair value | 21,042 | 31,568 |
Level 2 | Mortgage-backed Securities, U.S. Government-sponsored enterprises | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets measured at fair value | $ 22,192 | $ 32,839 |
Fair value of financial instr85
Fair value of financial instruments - Schedule of Assets and Liabilities Measured at Fair Value on Nonrecurring Basis (Details) - Nonrecurring Basis - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Impaired loans | $ 4,904 | $ 4,944 |
Other real estate owned | 371 | 878 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Impaired loans | 4,904 | 4,944 |
Other real estate owned | $ 371 | $ 878 |
Fair value of financial instr86
Fair value of financial instruments - Additional Quantitative Information about Assets Measured at Fair Value on Nonrecurring Basis (Details) - Nonrecurring Basis - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Other Real Estate Owned | ||
Fair Value Inputs, Assets, Quantitative Information | ||
Range and weighted average of appraisal adjustments | 43.10% | 30.30% |
Range and weighted average of liquidation expenses | 5.00% | 5.00% |
Other Real Estate Owned | Minimum | ||
Fair Value Inputs, Assets, Quantitative Information | ||
Range and weighted average of appraisal adjustments | 25.00% | 20.00% |
Range and weighted average of liquidation expenses | 3.00% | 3.00% |
Other Real Estate Owned | Maximum | ||
Fair Value Inputs, Assets, Quantitative Information | ||
Range and weighted average of appraisal adjustments | 54.60% | 77.30% |
Range and weighted average of liquidation expenses | 6.00% | 6.00% |
Impaired Loans | ||
Fair Value Inputs, Assets, Quantitative Information | ||
Range and weighted average of appraisal adjustments | 74.50% | 61.70% |
Range and weighted average of liquidation expenses | 5.30% | 5.40% |
Impaired Loans | Minimum | ||
Fair Value Inputs, Assets, Quantitative Information | ||
Range and weighted average of appraisal adjustments | 18.00% | 3.30% |
Range and weighted average of liquidation expenses | 3.00% | 3.00% |
Impaired Loans | Maximum | ||
Fair Value Inputs, Assets, Quantitative Information | ||
Range and weighted average of appraisal adjustments | 97.00% | 97.00% |
Range and weighted average of liquidation expenses | 6.00% | 6.00% |
Level 3 | Other Real Estate Owned | ||
Fair Value Inputs, Assets, Quantitative Information | ||
Assets, Fair Value Estimate | $ 371 | $ 878 |
Valuation Techniques | Appraisal of collateral | Appraisal of collateral |
Unobservable Input | Appraisal adjustments | Appraisal adjustments |
Liquidation expenses | Liquidation expenses | Liquidation expenses |
Level 3 | Impaired Loans | ||
Fair Value Inputs, Assets, Quantitative Information | ||
Assets, Fair Value Estimate | $ 4,904 | $ 4,944 |
Valuation Techniques | Appraisal of collateral | Appraisal of collateral |
Unobservable Input | Appraisal adjustments | Appraisal adjustments |
Liquidation expenses | Liquidation expenses | Liquidation expenses |
Fair value of financial instr87
Fair value of financial instruments - Carrying and Fair Values of Financial Instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Investment securities: | ||
Available-for-sale, Fair Value | $ 259,410 | |
Held-to-maturity, Fair value | 10,714 | $ 12,606 |
Mortgage servicing rights | 698 | 465 |
Carrying Value | ||
Financial assets: | ||
Cash and cash equivalents | 39,941 | 32,917 |
Investment securities: | ||
Available-for-sale, Fair Value | 259,410 | 284,935 |
Held-to-maturity, Fair value | 10,517 | 12,109 |
Net loans | 1,517,004 | 1,327,890 |
Accrued interest receivable | 6,228 | 5,796 |
Mortgage servicing rights | 698 | 465 |
Restricted equity securities | 7,051 | 5,403 |
Assets, Fair Value Disclosure | 1,840,849 | 1,669,515 |
Financial liabilities: | ||
Deposits | 1,588,757 | 1,455,810 |
Short-term borrowings | 82,700 | 38,325 |
Long-term debt | 58,134 | 60,354 |
Accrued interest payable | 462 | 560 |
Liabilities, total | 1,730,053 | 1,555,049 |
Fair Value | ||
Financial assets: | ||
Cash and cash equivalents | 39,941 | 32,917 |
Investment securities: | ||
Available-for-sale, Fair Value | 259,410 | 284,935 |
Held-to-maturity, Fair value | 10,714 | 12,606 |
Net loans | 1,507,936 | 1,330,900 |
Accrued interest receivable | 6,228 | 5,796 |
Mortgage servicing rights | 1,587 | 1,543 |
Restricted equity securities | 7,051 | 5,403 |
Assets, Fair Value Disclosure | 1,832,867 | 1,674,100 |
Financial liabilities: | ||
Deposits | 1,587,701 | 1,455,979 |
Short-term borrowings | 82,700 | 38,325 |
Long-term debt | 58,987 | 61,412 |
Accrued interest payable | 462 | 560 |
Liabilities, total | 1,729,850 | 1,556,276 |
Level 1 | ||
Financial assets: | ||
Cash and cash equivalents | 39,941 | 32,917 |
Investment securities: | ||
Available-for-sale, Fair Value | 7,438 | 9,999 |
Level 2 | ||
Investment securities: | ||
Available-for-sale, Fair Value | 251,972 | 274,936 |
Held-to-maturity, Fair value | 10,714 | 12,606 |
Accrued interest receivable | 6,228 | 5,796 |
Mortgage servicing rights | 1,587 | 1,543 |
Restricted equity securities | 7,051 | 5,403 |
Financial liabilities: | ||
Deposits | 1,587,701 | 1,455,979 |
Short-term borrowings | 82,700 | 38,325 |
Long-term debt | 58,987 | 61,412 |
Accrued interest payable | 462 | 560 |
Level 3 | ||
Investment securities: | ||
Net loans | $ 1,507,936 | $ 1,330,900 |
Stock plans - Additional Inform
Stock plans - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award | |||
Share based compensation expense | $ 71,000 | $ 69,000 | $ 70,000 |
Settlement of stock options | $ 83,000 | ||
Restricted stock cost | $ 0 | ||
Share based compensation requisite service period | 5 years | ||
Restricted stock vested period | 5 years | ||
Unrecognized compensation expense | $ 0 | $ 0 | |
2008 Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Common stock available for grant as awards | 129,207 | ||
Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Unrecognized compensation expense | $ 37,000 |
Stock plans - Schedule of Activ
Stock plans - Schedule of Activity Related to Restricted Stock (Details) - Restricted Stock - shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award | ||
Nonvested, January 1 | 14,309 | 17,245 |
Vested shares | 1,947 | 2,936 |
Nonvested, December 31 | 12,362 | 14,309 |
Employee benefit plans - Additi
Employee benefit plans - Additional Information (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Jun. 22, 2008 | |
Defined Benefit Plan Disclosure | ||||
Contribution to ESOP | $ 156,000 | $ 144,000 | $ 294,000 | |
Contribution by Penn Security Bank and Trust Company Retirement Profit Sharing Plan's | 786,000 | 778,000 | 872,000 | |
Discretionary contributions | $ 340,000 | 348,000 | 408,000 | |
Maximum annual benefit percent in excess of federal limits | 6.00% | |||
Retirement age period for fixed benefits payable | 65 years | |||
Benefits accrued under employees' pension plan | $ 0 | |||
Decrease in accumulated benefit obligation | $ 256,000 | 352,000 | ||
Defined benefit plan accumulated benefit obligation | $ 16,703,000 | 17,380,000 | ||
Defined benefit plan, diversification | We invest in individual high-grade common stocks that are selected from our approved list; (ii) diversification is maintained by having no more than 20% in any industry sector and no individual equity representing more than 10% of the portfolio | |||
Amount of company's common stock included in equity securities | $ 0 | 0 | ||
Expected payment period of benefits payment | 5 years | |||
Pension Benefits | ||||
Defined Benefit Plan Disclosure | ||||
Contribution by Penn Security Bank and Trust Company Retirement Profit Sharing Plan's | $ 54,000 | 240,000 | ||
Employee benefit plan expense | 13,000 | 15,000 | 5,000 | |
Employee benefit plan liability | 76,000 | 63,000 | ||
Defined benefit plan, net periodic benefit cost over next fiscal year | $ (19,000) | (37,000) | (140,000) | |
Industry Sector | ||||
Defined Benefit Plan Disclosure | ||||
Maximum diversification percentage | 20.00% | |||
Equity Securities | ||||
Defined Benefit Plan Disclosure | ||||
Maximum diversification percentage | 10.00% | |||
2,014 | ||||
Defined Benefit Plan Disclosure | ||||
Defined benefit plan, net periodic benefit cost over next fiscal year | $ 195,000 | |||
Cash Equivalents | ||||
Defined Benefit Plan Disclosure | ||||
Defined benefit plan, target allocation percentage | 10.00% | |||
Fixed Income | ||||
Defined Benefit Plan Disclosure | ||||
Defined benefit plan, target allocation percentage | 40.00% | |||
Equity | ||||
Defined Benefit Plan Disclosure | ||||
Defined benefit plan, target allocation percentage | 50.00% | |||
Safe Harbor | ||||
Defined Benefit Plan Disclosure | ||||
Contribution by Penn Security Bank and Trust Company Retirement Profit Sharing Plan's | $ 446,000 | 430,000 | 464,000 | |
SERPs | ||||
Defined Benefit Plan Disclosure | ||||
Defined benefit plan accrued liabilities | 1,416,000 | 1,244,000 | ||
Salaries and employee benefits expense | $ 254,000 | $ 157,000 | $ 176,000 |
Employee benefit plans - Summar
Employee benefit plans - Summary of Pension and Postretirement Life Insurance Plans (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Change in plan assets: | |||
Fair value of plan assets, beginning | $ 12,331 | ||
Employer contributions | 786 | $ 778 | $ 872 |
Fair value of plan assets, ending | 12,644 | 12,331 | |
Pension Benefits | |||
Change in benefit obligation: | |||
Benefit obligation, beginning | 17,380 | 17,869 | |
Interest cost | 665 | 696 | 678 |
Expected return on plan assets | (893) | (931) | (910) |
Change in experience loss (gain) | (322) | (41) | |
Change in assumptions loss (gain) | (256) | (367) | |
Benefits paid | (764) | (777) | |
Benefit obligation, ending | 16,703 | 17,380 | 17,869 |
Change in plan assets: | |||
Fair value of plan assets, beginning | 12,331 | 12,839 | |
Actual return on plan assets | 1,023 | 29 | |
Employer contributions | 54 | 240 | |
Benefits paid | (764) | (777) | |
Fair value of plan assets, ending | 12,644 | 12,331 | $ 12,839 |
Funded status at end of year | $ (4,059) | $ (5,049) |
Employee benefit plans - Schedu
Employee benefit plans - Schedule of Amounts Recognized in Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Amounts recognized in the accumulated other comprehensive loss consist of: | ||
Net amount recognized | $ 4,515 | $ 5,111 |
Pension Benefits | ||
Defined Benefit Plan Disclosure | ||
Liabilities | 4,059 | 5,049 |
Amounts recognized in the accumulated other comprehensive loss consist of: | ||
Net actuarial gain | (6,946) | (7,863) |
Deferred taxes | 2,431 | 2,752 |
Net amount recognized | $ (4,515) | $ (5,111) |
Employee benefit plans - Compon
Employee benefit plans - Components of Net Periodic Pension Expense (Income) and Other Amounts Recognized in Other Comprehensive Income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Changes in plan assets and benefit obligations recognized in other comprehensive income (loss): | |||
Net loss (gain) | $ 6,946 | $ 7,863 | |
Pension Benefits | |||
Net periodic pension cost: | |||
Interest cost | 665 | 696 | $ 678 |
Expected return on plan assets | (893) | (931) | (910) |
Amortization of unrecognized net loss | 209 | 198 | 92 |
Net periodic pension cost | (19) | (37) | (140) |
Changes in plan assets and benefit obligations recognized in other comprehensive income (loss): | |||
Net loss (gain) | 917 | 296 | 3,684 |
Deferred tax | (321) | (104) | (1,289) |
Total recognized in other comprehensive income | 596 | 192 | 2,395 |
Total recognized in net period pension cost and other comprehensive income | $ 577 | $ 155 | $ 2,255 |
Employee benefit plans - Sche94
Employee benefit plans - Schedule of Weighted-Average Assumptions Used to Determine Benefit Obligations and Related Expenses (Details) - Pension Benefits | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Defined Benefit Plan Disclosure | |||
Discount rate, Obligation | 4.00% | 4.00% | 4.00% |
Discount rate, Expense | 4.00% | 4.00% | 5.00% |
Expected long-term return on plan assets | 7.50% | 7.50% | 7.50% |
Employee benefit plans - Sche95
Employee benefit plans - Schedule of Pension Plan Weighted-Average Asset Allocations (Details) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Defined Benefit Plan Disclosure | ||
Weighted-average asset allocations | 100.00% | 100.00% |
Cash and Cash Equivalents | ||
Defined Benefit Plan Disclosure | ||
Weighted-average asset allocations | 4.20% | 5.90% |
Equity Securities | ||
Defined Benefit Plan Disclosure | ||
Weighted-average asset allocations | 58.00% | 57.00% |
Corporate Debt Securities | ||
Defined Benefit Plan Disclosure | ||
Weighted-average asset allocations | 26.20% | 23.00% |
U.S. Government Agencies | ||
Defined Benefit Plan Disclosure | ||
Weighted-average asset allocations | 11.60% | 14.10% |
Employee benefit plans - Fair V
Employee benefit plans - Fair Value Measurement of Pension Plan Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Defined Benefit Plan Disclosure | ||
Fair value of pension plan assets | $ 12,644 | $ 12,331 |
Cash | ||
Defined Benefit Plan Disclosure | ||
Fair value of pension plan assets | 529 | 781 |
Equity Securities | U.S. Large Cap | ||
Defined Benefit Plan Disclosure | ||
Fair value of pension plan assets | 7,046 | 6,772 |
Equity Securities | International | ||
Defined Benefit Plan Disclosure | ||
Fair value of pension plan assets | 282 | 225 |
Fixed Income Securities [Member] | U.S. Treasury securities | ||
Defined Benefit Plan Disclosure | ||
Fair value of pension plan assets | 498 | 760 |
Fixed Income Securities [Member] | U.S. Government Agencies | ||
Defined Benefit Plan Disclosure | ||
Fair value of pension plan assets | 977 | 971 |
Fixed Income Securities [Member] | Corporate Debt Securities | ||
Defined Benefit Plan Disclosure | ||
Fair value of pension plan assets | 3,312 | 2,822 |
Level 1 | ||
Defined Benefit Plan Disclosure | ||
Fair value of pension plan assets | 7,857 | 7,778 |
Level 1 | Cash | ||
Defined Benefit Plan Disclosure | ||
Fair value of pension plan assets | 529 | 781 |
Level 1 | Equity Securities | U.S. Large Cap | ||
Defined Benefit Plan Disclosure | ||
Fair value of pension plan assets | 7,046 | 6,772 |
Level 1 | Equity Securities | International | ||
Defined Benefit Plan Disclosure | ||
Fair value of pension plan assets | 282 | 225 |
Level 2 | ||
Defined Benefit Plan Disclosure | ||
Fair value of pension plan assets | 4,787 | 4,553 |
Level 2 | Fixed Income Securities [Member] | U.S. Treasury securities | ||
Defined Benefit Plan Disclosure | ||
Fair value of pension plan assets | 498 | 760 |
Level 2 | Fixed Income Securities [Member] | U.S. Government Agencies | ||
Defined Benefit Plan Disclosure | ||
Fair value of pension plan assets | 977 | 971 |
Level 2 | Fixed Income Securities [Member] | Corporate Debt Securities | ||
Defined Benefit Plan Disclosure | ||
Fair value of pension plan assets | $ 3,312 | $ 2,822 |
Employee benefit plans - Sche97
Employee benefit plans - Schedule of Benefit Payments Expected to be Paid (Details) - Pension Benefits $ in Thousands | Dec. 31, 2016USD ($) |
Defined Benefit Plan Disclosure | |
2,015 | $ 791 |
2,016 | 796 |
2,017 | 793 |
2,018 | 838 |
2,019 | 851 |
Thereafter | $ 4,784 |
Income taxes - Current and Defe
Income taxes - Current and Deferred Amounts of Provision for Income Taxes Expense (Benefit) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Current | $ 6,450 | $ 5,362 | $ 4,313 | ||||||||
Deferred income tax expense | (1,442) | (841) | 1,146 | ||||||||
Income Tax Expense (Benefit), Total | $ 1,223 | $ 1,390 | $ 1,238 | $ 1,157 | $ 770 | $ 1,113 | $ 1,124 | $ 1,514 | 5,008 | 4,521 | $ 5,459 |
Peoples Bank | |||||||||||
Income Tax Expense (Benefit), Total | $ (75) | $ (70) |
Income taxes - Components of Ne
Income taxes - Components of Net Deferred Tax Asset (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred tax assets: | ||
Allowance for loan losses | $ 5,586 | $ 4,541 |
Defined benefit plan | 2,431 | 2,752 |
Deferred compensation | 705 | 595 |
Capital loss carry forward | 211 | 244 |
Other | 706 | 440 |
Total | 9,639 | 8,572 |
Deferred tax liabilities: | ||
Premises and equipment, net | 981 | 771 |
Merger related accounting | 2,165 | 2,379 |
Investment securities available-for-sale | 197 | 1,607 |
Other | 725 | 530 |
Total | 4,068 | 5,287 |
Net deferred tax asset | $ 5,571 | $ 3,285 |
Income taxes - Additional Infor
Income taxes - Additional Information (Details) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income taxes | |||
Federal statutory rate | 35.00% | 35.00% | 35.00% |
Income taxes - Reconciliation o
Income taxes - Reconciliation of Effective Income Tax Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Federal income tax at statutory rate | $ 8,607 | $ 7,785 | $ 8,088 | ||||||||
Tax exempt interest | (2,264) | (2,008) | (1,938) | ||||||||
Bank owned life insurance income | (277) | (268) | (272) | ||||||||
Residential housing program tax credits | (1,128) | (1,115) | (439) | ||||||||
Other, net | 70 | 127 | 20 | ||||||||
Income Tax Expense (Benefit), Total | $ 1,223 | $ 1,390 | $ 1,238 | $ 1,157 | $ 770 | $ 1,113 | $ 1,124 | $ 1,514 | 5,008 | 4,521 | $ 5,459 |
Peoples Bank | |||||||||||
Income Tax Expense (Benefit), Total | $ (75) | $ (70) |
Parent Company financial sta102
Parent Company financial statements - Condensed Balance Sheets (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Assets: | ||||
Cash and cash equivalents | $ 39,941 | $ 32,917 | $ 31,426 | $ 51,310 |
Investment securities available-for-sale | 259,410 | |||
Total assets | 1,999,442 | 1,819,058 | ||
Liabilities and Stockholders' Equity: | ||||
Other liabilities | 12,771 | 15,241 | ||
Stockholders' equity | 256,618 | 248,768 | 246,779 | 238,792 |
Total liabilities and stockholders' equity | 1,999,442 | 1,819,058 | ||
Peoples Bank | ||||
Assets: | ||||
Cash and cash equivalents | 3,948 | 4,119 | $ 4,183 | $ 3,157 |
Investment in bank subsidiary | 250,869 | 242,765 | ||
Due from subsidiaries | 1,903 | 2,063 | ||
Total assets | 256,720 | 248,947 | ||
Liabilities and Stockholders' Equity: | ||||
Other liabilities | 102 | 179 | ||
Stockholders' equity | 256,618 | 248,768 | ||
Total liabilities and stockholders' equity | $ 256,720 | $ 248,947 |
Parent Company financial sta103
Parent Company financial statements - Condensed Statements of Income and Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Interest income: | |||||||||||
Dividends from subsidiaries | $ 48 | $ 35 | $ 50 | ||||||||
Expense: | |||||||||||
Income before income taxes | $ 5,951 | $ 6,508 | $ 6,093 | $ 6,039 | $ 4,609 | $ 5,522 | $ 5,555 | $ 6,558 | |||
Income tax expense | 1,223 | 1,390 | 1,238 | 1,157 | 770 | 1,113 | 1,124 | 1,514 | 5,008 | 4,521 | 5,459 |
Net income | $ 4,728 | $ 5,118 | $ 4,855 | $ 4,882 | $ 3,839 | $ 4,409 | $ 4,431 | $ 5,044 | 19,583 | 17,723 | 17,649 |
Comprehensive Income | 17,553 | 16,427 | 17,518 | ||||||||
Peoples Bank | |||||||||||
Interest income: | |||||||||||
Dividends from subsidiaries | 9,170 | 9,319 | 9,360 | ||||||||
Other income | 46 | 40 | 430 | ||||||||
Total income | 9,216 | 9,359 | 9,790 | ||||||||
Expense: | |||||||||||
Other expenses | 259 | 243 | 251 | ||||||||
Total expenses | 259 | 243 | 251 | ||||||||
Income before income taxes | 8,957 | 9,116 | 9,539 | ||||||||
Income tax expense | (75) | (70) | |||||||||
Income before undistributed income of subsidiaries | 9,032 | 9,186 | 9,539 | ||||||||
Equity in undistributed net income (loss) of subsidiaries | 10,551 | 8,537 | 8,110 | ||||||||
Net income | 19,583 | 17,723 | 17,649 | ||||||||
Comprehensive Income | $ 17,553 | $ 16,427 | $ 17,518 |
Parent Company financial sta104
Parent Company financial statements - Condensed Statements of Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Cash flows from operating activities: | |||||||||||
Net income | $ 4,728 | $ 5,118 | $ 4,855 | $ 4,882 | $ 3,839 | $ 4,409 | $ 4,431 | $ 5,044 | $ 19,583 | $ 17,723 | $ 17,649 |
Adjustments: | |||||||||||
Other assets | 1,373 | (213) | (4,860) | ||||||||
Other liabilities | (2,470) | (820) | 2,074 | ||||||||
Stock based compensation | 71 | 69 | 70 | ||||||||
Deferred income tax expense | (1,442) | (841) | 1,146 | ||||||||
Net cash provided by operating activities | 28,053 | 29,179 | 24,199 | ||||||||
Cash flows from investing activities: | |||||||||||
Proceeds from sales of investment securities available-for-sale | 27,408 | 81,983 | 15,389 | ||||||||
Purchase of available-for-sale securities | (62,022) | (90,402) | (102,304) | ||||||||
Net cash used in investing activities | (186,357) | (89,415) | (74,435) | ||||||||
Cash flows from financing activities: | |||||||||||
Retirement of common stock | (604) | (5,188) | (109) | ||||||||
Cash dividends paid | (9,170) | (9,319) | (9,360) | ||||||||
Net cash provided by financing activities | 165,328 | 61,727 | 30,352 | ||||||||
Net increase (decrease) in cash and cash equivalents | 7,024 | 1,491 | (19,884) | ||||||||
Cash and cash equivalents at beginning of year | 32,917 | 31,426 | 32,917 | 31,426 | 51,310 | ||||||
Cash and cash equivalents at end of year | 39,941 | 32,917 | 39,941 | 32,917 | 31,426 | ||||||
Peoples Bank | |||||||||||
Cash flows from operating activities: | |||||||||||
Net income | 19,583 | 17,723 | 17,649 | ||||||||
Adjustments: | |||||||||||
Net realized gains on sales of securities | (375) | ||||||||||
Undistributed net income of subsidiaries | (10,551) | (8,537) | (10,551) | (8,537) | (8,110) | ||||||
Other assets | 577 | 5,257 | 1,182 | ||||||||
Other liabilities | (77) | (69) | (511) | ||||||||
Stock based compensation | 71 | 69 | 70 | ||||||||
Net cash provided by operating activities | 9,603 | 14,443 | 9,905 | ||||||||
Cash flows from investing activities: | |||||||||||
Proceeds from sales of investment securities available-for-sale | 722 | ||||||||||
Net cash used in investing activities | 722 | ||||||||||
Cash flows from financing activities: | |||||||||||
Retirement of common stock | (604) | (5,188) | (109) | ||||||||
Settlement of stock options | (83) | ||||||||||
Reissuance of treasury shares | 21 | ||||||||||
Purchase of treasury stock | (70) | ||||||||||
Cash dividends paid | (9,170) | (9,319) | (9,360) | ||||||||
Net cash provided by financing activities | (9,774) | (14,507) | (9,601) | ||||||||
Net increase (decrease) in cash and cash equivalents | (171) | (64) | 1,026 | ||||||||
Cash and cash equivalents at beginning of year | $ 4,119 | $ 4,183 | 4,119 | 4,183 | 3,157 | ||||||
Cash and cash equivalents at end of year | $ 3,948 | $ 4,119 | $ 3,948 | $ 4,119 | $ 4,183 |
Regulatory matters - Additional
Regulatory matters - Additional Information (Details) - USD ($) | Jan. 01, 2016 | Jan. 01, 2015 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Schedule of Capitalization | |||||||
Percentage of capital stock | 100.00% | ||||||
Payment of dividends description | The Penseco merger agreement contemplates that, unless 80 percent of our Board of Directors determines otherwise, the Company will pay a quarterly cash dividend in an amount no less than $0.31 per share through 2018, provided that sufficient funds are legally available, and that the Company and Peoples Bank remain "well-capitalized" in accordance with applicable regulatory guidelines. | ||||||
Period of accumulated net earnings acquired as a result of merger related to dividend | 7 years | ||||||
Funds available for transfers | $ 20,593,000 | ||||||
Loans outstanding | $ 0 | $ 0 | |||||
Phase in period for capital conservation buffer | 4 years | ||||||
Capital conservation buffer | 2.50% | 2.50% | 1.875% | 1.25% | |||
Maximum | |||||||
Schedule of Capitalization | |||||||
Percentage of funds transfer to affiliate | 10.00% | ||||||
Capital conservation buffer | 0.625% | ||||||
Minimum | |||||||
Schedule of Capitalization | |||||||
Percentage of net earnings to surplus funds | 10.00% | ||||||
Quarterly cash dividend per share | $ 0.31 |
Regulatory matters - Schedule o
Regulatory matters - Schedule of Bank's Capital Amounts and Ratios (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Consolidated | ||
Common equity Tier 1 capital to risk-weighted assets | ||
Common equity Tier 1 capital to risk-weighted assets, Actual Amount | $ 194,877 | $ 185,365 |
Common equity Tier 1 capital to risk-weighted assets, Actual Ratio | 12.49% | 13.52% |
Common equity Tier 1 capital to risk-weighted assets, Minimum For Capital Adequacy Purposes Amount | $ 70,205 | $ 61,675 |
Common equity Tier 1 capital to risk-weighted assets, Minimum For Capital Adequacy Purposes Ratio | 4.50% | 4.50% |
Tier 1 capital to risk-weighted assets | ||
Tier 1 capital to risk-weighted assets, Actual Amount | $ 194,877 | $ 185,365 |
Tier 1 capital to risk-weighted assets, Actual Ratio | 12.49% | 13.52% |
Tier 1 capital to risk-weighted assets, Minimum For Capital Adequacy Purposes Amount | $ 93,607 | $ 82,233 |
Tier 1 capital to risk-weighted assets, Minimum For Capital Adequacy Purposes Ratio | 6.00% | 6.00% |
Total capital to risk-weighted assets | ||
Total capital to risk-weighted assets, Actual Amount | $ 210,838 | $ 198,340 |
Total capital to risk-weighted assets, Actual Ratio | 13.51% | 14.47% |
Total capital to risk-weighted assets, Minimum For Capital Adequacy Purposes Amount | $ 124,810 | $ 109,644 |
Total capital to risk-weighted assets, Minimum For Capital Adequacy Purposes Ratio | 8.00% | 8.00% |
Tier 1 capital to average assets | ||
Tier 1 capital to average assets, Actual Amount | $ 194,877 | $ 185,365 |
Tier 1 capital to average assets, Actual Ratio | 10.16% | 10.80% |
Tier 1 capital to average assets, Minimum For Capital Adequacy Purposes Amount | $ 76,760 | $ 68,638 |
Tier 1 capital to average assets, Minimum For Capital Adequacy Purposes Ratio | 4.00% | 4.00% |
Peoples Bank | ||
Common equity Tier 1 capital to risk-weighted assets | ||
Common equity Tier 1 capital to risk-weighted assets, Actual Amount | $ 189,128 | $ 179,362 |
Common equity Tier 1 capital to risk-weighted assets, Actual Ratio | 12.14% | 13.11% |
Common equity Tier 1 capital to risk-weighted assets, Minimum For Capital Adequacy Purposes Amount | $ 70,120 | $ 61,583 |
Common equity Tier 1 capital to risk-weighted assets, Minimum For Capital Adequacy Purposes Ratio | 4.50% | 4.50% |
Common equity Tier 1 capital to risk-weighted assets, Minimum to be Well Capitalized under Prompt Corrective Action Provisions Amount | $ 101,284 | $ 88,954 |
Common equity Tier 1 capital to risk-weighted assets, Minimum to be Well Capitalized under Prompt Corrective Action Provisions Ratio | 6.50% | 6.50% |
Tier 1 capital to risk-weighted assets | ||
Tier 1 capital to risk-weighted assets, Actual Amount | $ 189,128 | $ 179,362 |
Tier 1 capital to risk-weighted assets, Actual Ratio | 12.14% | 13.11% |
Tier 1 capital to risk-weighted assets, Minimum For Capital Adequacy Purposes Amount | $ 93,493 | $ 82,111 |
Tier 1 capital to risk-weighted assets, Minimum For Capital Adequacy Purposes Ratio | 6.00% | 6.00% |
Tier 1 capital to risk-weighted assets, Minimum to be Well Capitalized under Prompt Corrective Action Provisions Amount | $ 124,657 | $ 109,481 |
Tier 1 capital to risk-weighted assets, Minimum to be Well Capitalized under Prompt Corrective Action Provisions Ratio | 8.00% | 8.00% |
Total capital to risk-weighted assets | ||
Total capital to risk-weighted assets, Actual Amount | $ 205,089 | $ 192,337 |
Total capital to risk-weighted assets, Actual Ratio | 13.16% | 14.05% |
Total capital to risk-weighted assets, Minimum For Capital Adequacy Purposes Amount | $ 124,657 | $ 109,481 |
Total capital to risk-weighted assets, Minimum For Capital Adequacy Purposes Ratio | 8.00% | 8.00% |
Total capital to risk-weighted assets, Minimum to be Well Capitalized under Prompt Corrective Action Provisions Amount | $ 155,822 | $ 136,852 |
Total capital to risk-weighted assets, Minimum to be Well Capitalized under Prompt Corrective Action Provisions Ratio | 10.00% | 10.00% |
Tier 1 capital to average assets | ||
Tier 1 capital to average assets, Actual Amount | $ 189,128 | $ 179,362 |
Tier 1 capital to average assets, Actual Ratio | 9.88% | 10.48% |
Tier 1 capital to average assets, Minimum For Capital Adequacy Purposes Amount | $ 76,602 | $ 68,474 |
Tier 1 capital to average assets, Minimum For Capital Adequacy Purposes Ratio | 4.00% | 4.00% |
Tier 1 capital to average assets, Minimum to be Well Capitalized under Prompt Corrective Action Provisions Amount | $ 95,753 | $ 85,592 |
Tier 1 capital to average assets, Minimum to be Well Capitalized under Prompt Corrective Action Provisions Ratio | 5.00% | 5.00% |
Comprehensive Income - Componen
Comprehensive Income - Components of Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Comprehensive Income | ||
Net unrealized gain on investment securities available-for-sale | $ 553 | $ 4,593 |
Income tax | 193 | 1,607 |
Net of income taxes | 360 | 2,986 |
Benefit plan adjustments | (6,946) | (7,863) |
Income tax expense (benefit) | 2,431 | 2,752 |
Net of income taxes | (4,515) | (5,111) |
Accumulated other comprehensive loss | $ (4,155) | $ (2,125) |
Comprehensive Income - Other Co
Comprehensive Income - Other Comprehensive Income (Loss) and Related Tax Effects (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Comprehensive Income | |||
Unrealized gain (loss) on investment securities available-for-sale | $ (3,417) | $ (510) | $ 4,343 |
Net gain on the sale of investment securities available-for-sale(1) | (623) | (1,189) | (861) |
Amortization of actuarial loss (gain) | 208 | 198 | 92 |
Actuarial (loss) gain | 709 | (494) | (3,776) |
Net change in benefit plan liabilities | 917 | (296) | (3,684) |
Other comprehensive income gain (loss) before taxes | (3,123) | (1,995) | (202) |
Income tax | (1,093) | (699) | (71) |
Other comprehensive (loss) income, net of income taxes | $ (2,030) | $ (1,296) | $ (131) |
Summary of quarterly financi109
Summary of quarterly financial information - Summary of Quarterly Financial Information (unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Interest income | $ 17,715 | $ 17,525 | $ 17,058 | $ 16,686 | $ 16,177 | $ 15,598 | $ 15,638 | $ 15,628 | $ 68,984 | $ 63,041 | $ 63,956 |
Interest expense | 1,941 | 1,825 | 1,765 | 1,720 | 1,569 | 1,485 | 1,448 | 1,535 | 7,251 | 6,037 | 6,642 |
Net interest income | 15,774 | 15,700 | 15,293 | 14,966 | 14,608 | 14,113 | 14,190 | 14,093 | 61,733 | 57,004 | 57,314 |
Provision for loan losses | 1,400 | 1,200 | 1,200 | 1,200 | 1,300 | 900 | 750 | 750 | 5,000 | 3,700 | 3,524 |
Net interest income after provision for loan losses | 14,374 | 14,500 | 14,093 | 13,766 | 13,308 | 13,213 | 13,440 | 13,343 | 56,733 | 53,304 | 53,790 |
Noninterest income | 3,859 | 4,025 | 4,113 | 3,891 | 3,769 | 4,015 | 3,626 | 4,309 | 15,888 | 15,719 | 15,251 |
Noninterest expense | 12,282 | 12,017 | 12,113 | 11,618 | 12,468 | 11,706 | 11,511 | 11,094 | 48,030 | 46,779 | 45,933 |
Income (loss) before income taxes | 5,951 | 6,508 | 6,093 | 6,039 | 4,609 | 5,522 | 5,555 | 6,558 | |||
Income tax expense (benefit) | 1,223 | 1,390 | 1,238 | 1,157 | 770 | 1,113 | 1,124 | 1,514 | 5,008 | 4,521 | 5,459 |
Net income (loss) | $ 4,728 | $ 5,118 | $ 4,855 | $ 4,882 | $ 3,839 | $ 4,409 | $ 4,431 | $ 5,044 | $ 19,583 | $ 17,723 | 17,649 |
Per share data: | |||||||||||
Net income (loss) | $ 0.64 | $ 0.69 | $ 0.66 | $ 0.66 | $ 0.52 | $ 0.58 | $ 0.59 | $ 0.67 | |||
Cash dividends declared | $ 0.31 | $ 0.31 | $ 0.31 | $ 0.31 | $ 0.31 | $ 0.31 | $ 0.31 | $ 0.31 | $ 0.31 | $ 0.31 | |
Average common shares outstanding | 7,394,143 | 7,394,143 | 7,395,127 | 7,403,510 | 7,435,440 | 7,536,824 | 7,546,198 | 7,548,358 | |||
Peoples Bank | |||||||||||
Income (loss) before income taxes | $ 8,957 | $ 9,116 | 9,539 | ||||||||
Income tax expense (benefit) | (75) | (70) | |||||||||
Net income (loss) | $ 19,583 | $ 17,723 | $ 17,649 |