Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Feb. 28, 2019 | Jun. 30, 2018 | |
Document And Entity Information | |||
Entity Registrant Name | PEOPLES FINANCIAL SERVICES CORP. | ||
Trading Symbol | pfis | ||
Entity Central Index Key | 0001056943 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2018 | ||
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 Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 347,903,519 | ||
Entity Common Stock, Shares Outstanding | 7,399,054 | ||
Document Fiscal Year Focus | 2018 | ||
Document Fiscal Period Focus | FY |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Cash and due from banks: | ||
Cash and due from banks | $ 32,569 | $ 36,336 |
Interest-bearing deposits in other banks | 47 | 1,152 |
Total cash and due from banks | 32,616 | 37,488 |
Investment securities: | ||
Available-for-sale | 269,682 | 272,502 |
Equity investments carried at fair value | 291 | 46 |
Held-to-maturity: Fair value December 31, 2018, $8,380; December 31, 2017, $9,547 | 8,361 | 9,274 |
Total investment securities | 278,334 | 281,822 |
Loans, net | 1,823,266 | 1,693,065 |
Less: allowance for loan losses | 21,379 | 18,960 |
Net loans | 1,801,887 | 1,674,105 |
Loans held for sale | 749 | 106 |
Premises and equipment, net | 38,889 | 37,557 |
Accrued interest receivable | 7,115 | 6,936 |
Goodwill | 63,370 | 63,370 |
Intangible assets, net | 2,296 | 3,178 |
Other assets | 63,737 | 64,469 |
Total assets | 2,288,993 | 2,169,031 |
Deposits: | ||
Noninterest-bearing | 410,260 | 380,729 |
Interest-bearing | 1,464,762 | 1,338,289 |
Total deposits | 1,875,022 | 1,719,018 |
Short-term borrowings | 86,500 | 123,675 |
Long-term debt | 37,906 | 49,734 |
Accrued interest payable | 1,195 | 497 |
Other liabilities | 9,756 | 11,131 |
Total liabilities | 2,010,379 | 1,904,055 |
Stockholders’ equity: | ||
Common stock, par value $2.00, authorized 25,000,000 shares, issued and outstanding 7,399,054 shares at December 31, 2018 and 7,396,505 at December 31, 2017 | 14,798 | 14,793 |
Capital surplus | 135,310 | 135,043 |
Retained earnings | 136,582 | 121,353 |
Accumulated other comprehensive loss | (8,076) | (6,213) |
Total stockholders’ equity | 278,614 | 264,976 |
Total liabilities and stockholders’ equity | $ 2,288,993 | $ 2,169,031 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Statement of Financial Position | ||
Held-to-maturity, Fair value | $ 8,380 | $ 9,547 |
Common stock, par value | $ 2 | $ 2 |
Common stock, shares authorized | 25,000,000 | 25,000,000 |
Common stock, shares issued | 7,399,054 | 7,396,505 |
Common stock, shares outstanding | 7,399,054 | 7,396,505 |
Consolidated Statements of Inco
Consolidated Statements of Income and Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Interest and fees on loans: | |||
Taxable | $ 74,352 | $ 64,946 | $ 59,902 |
Tax-exempt | 3,666 | 3,163 | 3,031 |
Interest and dividends on investment securities: | |||
Taxable | 3,799 | 2,949 | 2,515 |
Tax-exempt | 2,621 | 2,999 | 3,438 |
Dividends | 72 | 52 | 48 |
Interest on interest-bearing deposits in other banks | 151 | 133 | 50 |
Total interest income | 84,661 | 74,242 | 68,984 |
Interest expense: | |||
Interest on deposits | 9,346 | 6,450 | 5,429 |
Interest on short-term borrowings | 2,738 | 900 | 402 |
Interest on long-term debt | 1,238 | 1,348 | 1,420 |
Total interest expense | 13,322 | 8,698 | 7,251 |
Net interest income | 71,339 | 65,544 | 61,733 |
Provision for loan losses | 4,200 | 4,800 | 5,000 |
Net interest income after provision for loan losses | 67,139 | 60,744 | 56,733 |
Noninterest income: | |||
Mortgage banking income | 627 | 784 | 885 |
Life insurance investment income | 757 | 769 | 791 |
Net gains on investment securities | 14 | 623 | |
Net gain on sale of credit card loans | 291 | ||
Net gain on sale of merchant services business | 2,278 | ||
Total noninterest income | 13,659 | 17,186 | 15,888 |
Noninterest expense: | |||
Salaries and employee benefits expense | 28,407 | 26,670 | 22,434 |
Net occupancy and equipment expense | 10,897 | 9,975 | 9,422 |
Merchant services expense | 9 | 1,808 | 2,993 |
Amortization of intangible assets | 881 | 1,034 | 1,186 |
Professional fees and outside services | 2,414 | 2,277 | 2,128 |
FDIC insurance and assessments | 1,093 | 826 | 1,101 |
Donations | 1,339 | 1,188 | 1,006 |
Other expenses | 7,447 | 7,515 | 7,760 |
Total noninterest expense | 52,487 | 51,293 | 48,030 |
Income before income taxes | 28,311 | 26,637 | 24,591 |
Income tax expense | 3,391 | 8,180 | 5,008 |
Net income | 24,920 | 18,457 | 19,583 |
Other comprehensive (loss) income: | |||
Unrealized (loss) gain on investment securities available-for-sale | (2,014) | (1,790) | (3,417) |
Reclassification adjustment for net gain on sales included in net income | (623) | ||
Change in benefit plan liabilities | (591) | 318 | 917 |
Change in derivative value | 246 | ||
Other comprehensive loss | (2,359) | (1,472) | (3,123) |
Income tax benefit | (496) | (515) | (1,093) |
Other comprehensive loss, net of income taxes | (1,863) | (957) | (2,030) |
Comprehensive income | $ 23,648 | $ 17,500 | $ 17,553 |
Net income: | |||
Basic | $ 3.37 | $ 2.50 | $ 2.65 |
Diluted | $ 3.37 | $ 2.50 | $ 2.65 |
Average common shares outstanding: | |||
Basic | 7,397,797 | 7,395,837 | 7,396,716 |
Diluted | 7,397,797 | 7,395,837 | 7,396,716 |
Dividends declared | $ 1.31 | $ 1.26 | $ 1.24 |
Service charges, fees and commissions | |||
Noninterest income: | |||
Revenue from contracts with customers | $ 7,678 | $ 7,344 | $ 6,116 |
Merchant services income | |||
Noninterest income: | |||
Revenue from contracts with customers | 809 | 2,543 | 4,199 |
Commission and fees on fiduciary activities | |||
Noninterest income: | |||
Revenue from contracts with customers | 2,036 | 2,057 | 1,976 |
Wealth management income | |||
Noninterest income: | |||
Revenue from contracts with customers | $ 1,447 | $ 1,411 | $ 1,298 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands | Common Stock | Capital Surplus | Retained Earnings | Accumulated Other Comprehensive Loss | Total |
Balance at Dec. 31, 2015 | $ 14,821 | $ 135,371 | $ 100,701 | $ (2,125) | $ 248,768 |
Net income | 19,583 | 19,583 | |||
Stock based compensation | 71 | 71 | |||
Other comprehensive income, net of income taxes | (2,030) | (2,030) | |||
Dividends declared | (9,170) | (9,170) | |||
Share retirement | (33) | (571) | (604) | ||
Balance at Dec. 31, 2016 | 14,788 | 134,871 | 111,114 | (4,155) | 256,618 |
Net income | 18,457 | 18,457 | |||
Stock based compensation | 177 | 177 | |||
Other comprehensive income, net of income taxes | (957) | (957) | |||
Reclassification related to adoption of ASU 2018-02 | 1,101 | (1,101) | |||
Dividends declared | (9,319) | (9,319) | |||
Common stock grants awarded, net of unearned compensation | 5 | (5) | |||
Balance at Dec. 31, 2017 | 14,793 | 135,043 | 121,353 | (6,213) | 264,976 |
Net income | 24,920 | 24,920 | |||
Stock based compensation | 272 | 272 | |||
Other comprehensive income, net of income taxes | (1,861) | (1,861) | |||
Dividends declared | (9,693) | (9,693) | |||
Common stock grants awarded, net of unearned compensation | 5 | (5) | |||
Balance at Dec. 31, 2018 | $ 14,798 | $ 135,310 | 136,582 | (8,076) | $ 278,614 |
Reclassification related to adoption of ASU 2016-01 | Accounting Standards Update 2016-01 | $ 2 | $ (2) |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Stockholders' Equity (Parenthetical) $ in Thousands | 12 Months Ended |
Dec. 31, 2016$ / sharesshares | |
Statement of Stockholders' Equity | |
Dividends declared (in dollars per share) | $ / shares | $ 1.24 |
Share retired, shares | shares | 16,463 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flows from operating activities: | |||
Net income | $ 24,920 | $ 18,457 | $ 19,583 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation of premises and equipment | 2,333 | 1,950 | 1,661 |
Amortization of deferred loan costs | 525 | 907 | 786 |
Amortization of intangibles | 881 | 1,034 | 1,186 |
Amortization of low income housing partnerships | 465 | 470 | 477 |
Provision for loan losses | 4,200 | 4,800 | 5,000 |
Net unrealized gain on equity investment securities | (14) | ||
Net gain on sale of other real estate owned | (21) | (11) | 137 |
Gain on life insurance proceeds | (368) | ||
Loans originated for sale | (13,194) | (21,036) | (26,708) |
Proceeds from sale of loans originated for sale | 12,650 | 21,149 | 27,593 |
Net gain on sale of loans originated for sale | (99) | (219) | (885) |
Net amortization of investment securities | 2,206 | 2,764 | 3,635 |
Net gain on sale of investment securities available-for-sale | 623 | ||
Net gain on sale of credit card loans held for sale | (291) | ||
Net gain on sale of merchant services business | (2,278) | ||
Life insurance investment income | (757) | (769) | (791) |
Deferred income tax expense (benefit) | (681) | 1,665 | (1,442) |
Stock based compensation | 272 | 177 | 71 |
Net change in: | |||
Accrued interest receivable | (179) | (708) | (432) |
Other assets | 816 | 2,023 | 1,373 |
Accrued interest payable | 698 | 35 | (98) |
Other liabilities | (1,736) | (1,817) | (2,470) |
Net cash provided by operating activities | 32,626 | 28,593 | 28,053 |
Cash flows from investing activities: | |||
Proceeds from sales of investment securities available-for-sale | 27,408 | ||
Proceeds from repayments of investment securities: | |||
Available-for-sale | 31,093 | 55,800 | 53,128 |
Held-to-maturity | 898 | 1,222 | 1,561 |
Purchases of investment securities: | |||
Available-for-sale | (32,709) | (73,471) | (62,022) |
Net redemption of restricted equity securities | 1,100 | (1,511) | (1,648) |
Proceeds from sale of student loan portfolio | 5,103 | ||
Proceeds from sale of credit card loan portfolio | 2,698 | ||
Net increase in lending activities | (141,277) | (163,236) | (195,408) |
Investment in low income housing partnerships | (2,045) | ||
Purchases of premises and equipment | (4,069) | (6,247) | (6,764) |
Proceeds from the sale of premises and equipment | 404 | ||
Purchase of investment in life insurance | 672 | (1,500) | |
Proceeds from the sale of merchant services business | 2,300 | ||
Proceeds from sale of other real estate owned | 1,281 | 580 | 933 |
Net cash used in investing activities | (134,806) | (184,563) | (186,357) |
Cash flows from financing activities: | |||
Net increase in deposits | 156,004 | 130,261 | 132,947 |
Repayment of long-term debt | (11,828) | (8,400) | (2,220) |
Net (decrease) increase in short-term borrowings | (37,175) | 40,975 | 44,375 |
Retirement of common stock | (604) | ||
Cash dividends paid | (9,693) | (9,319) | (9,170) |
Net cash provided by (used in) financing activities | 97,308 | 153,517 | 165,328 |
Net increase (decrease) in cash and cash equivalents | (4,872) | (2,453) | 7,024 |
Cash and cash equivalents at beginning of period | 37,488 | 39,941 | 32,917 |
Cash and cash equivalents at end of period | 32,616 | 37,488 | 39,941 |
Cash paid during the period for: | |||
Interest | 12,624 | 8,663 | 7,349 |
Income taxes | 2,650 | 5,900 | 5,900 |
Noncash items: | |||
Transfers of loans to other real estate | $ 1,432 | $ 460 | $ 757 |
Summary of significant accounti
Summary of significant accounting policies | 12 Months Ended |
Dec. 31, 2018 | |
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”), collectively, the “Company” or “Peoples”. The Company services its retail and commercial customers through twenty-seven full-service community banking offices located within Bucks, Lackawanna, Lehigh, Luzerne, Monroe, Montgomery, Northampton, Susquehanna, Wayne and Wyoming Counties of Pennsylvania and Broome County of New York and one limited purpose banking office located in Schuylkill County, Pennsylvania. 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 deposits to commercial enterprises and individuals. Deposit product offerings include checking accounts, savings accounts, money market accounts and certificates of deposits. 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: The consolidated financial statements of the Company have been prepared in conformity with accounting principles generally accepted in the United States of America (“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, 2018, 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 with unrealized gains and losses reported in earnings. 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 on callable debt securities are amortized to the earliest call date from the maturity date. Premiums on non-callable securities are amortized and discounts are accreted using the interest method over the expected life of the security. 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, the Company requires 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, the Company considers and reviews a cash flow analysis of the borrower and guarantor, when applicable. In addition, the Company evaluates business cash flows, if applicable, net operating income of the property, the borrower’s expertise, credit history and the value of the underlying property. The Company has 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 and a formula portion for loss contingencies on those loans collectively evaluated. 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 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. 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 inherent in the loan portfolio as of December 31, 2018. Revenue from Contracts with Customers: The Company records revenue from contracts with customers in accordance with Accounting Standards Codification Topic 606, “Revenue from Contracts with Customers” (“Topic 606”). Under Topic 606, the Company must identify the contract with a customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract, and recognize revenue when (or as) the Company satisfies a performance obligation. Significant revenue has not been recognized in the current reporting period that results from performance obligations satisfied in previous periods. The Company’s primary sources of revenue are derived from interest and dividends earned on loans, investment securities, and other financial instruments that are not within the scope of Topic 606. The Company has evaluated the nature of its contracts with customers and determined that further disaggregation of revenue from contracts with customers into more granular categories beyond what is presented in the Consolidated Statements of Income was not necessary. The Company generally fully satisfies its performance obligations on its contracts with customers as services are rendered and the transaction prices are typically fixed; charged either on a periodic basis or based on activity. The following is a discussion of revenues within the scope of the new guidance: · Service charges, fees and commissions . Service charges, fees and commissions on deposit accounts include fees for banking services provided, overdrafts and non-sufficient funds. Revenue is generally recognized in accordance with published deposit account agreements for retail accounts or contractual agreements for commercial accounts. Our deposit services also include our ATM and debit card interchange revenue that is presented gross of the associated costs. Interchange revenue is generated by our deposit customers’ usage and volume of activity. Interchange rates are not controlled by the Company, which effectively acts as processor that collects and remits payments associated with customer debit card transactions. · Commission and fees on fiduciary activities. Commission and fees on fiduciary activities includes fees and commissions from investment management, administrative and advisory services primarily for individuals, and to a lesser extent, partnerships and corporations. Revenue is recognized on an accrual basis at the time the services are performed and when we have a right to invoice and are based on either the market value of the assets managed or the services provided. · Wealth management income. Wealth management income includes fees and commissions charged when we arrange for another party to transfer brokerage services to a customer. The fees and commissions under this agent relationship are based upon stated fee schedules based upon the type of transaction, volume, and value of the services provided. · Other noninterest income . Other nonin |
Cash and due from banks
Cash and due from banks | 12 Months Ended |
Dec. 31, 2018 | |
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 $2,768 and $22,651 at December 31, 2018 and 2017, respectively. |
Investment securities
Investment securities | 12 Months Ended |
Dec. 31, 2018 | |
Investment securities | |
Investment securities | 3. Investment securities: The amortized cost and fair value of investment securities aggregated by investment category at December 31, 2018 and 2017 are summarized as follows: Gross Gross Amortized Unrealized Unrealized Fair December 31, 2018 Cost Gains Losses Value Available-for-sale: U.S. Treasury securities $ 25,948 $ 9 $ 365 $ 25,592 U.S. Government-sponsored enterprises 94,999 2 2,183 92,818 State and municipals: Taxable 13,544 309 13,853 Tax-exempt 86,361 338 745 85,954 Residential Mortgage-backed securities: U.S. Government agencies 12,663 50 84 12,629 U.S. Government-sponsored enterprises 33,149 49 401 32,797 Commercial Mortgage-backed securities: U.S. Government-sponsored enterprises 6,269 230 6,039 Total $ 272,933 $ 757 $ 4,008 $ 269,682 Held-to-maturity: Tax-exempt state and municipals $ 6,855 $ 12 $ 43 $ 6,824 Residential Mortgage-backed securities: U.S. Government agencies 42 42 U.S. Government-sponsored enterprises 1,464 55 5 1,514 Total $ 8,361 $ 67 $ 48 $ 8,380 Gross Gross Amortized Unrealized Unrealized Fair December 31, 2017 Cost Gains Losses Value Available-for-sale: U.S. Treasury securities $ 20,042 $ 228 $ 19,814 U.S. Government-sponsored enterprises 95,358 $ 30 1,740 93,648 State and municipals: Taxable 14,559 488 15,047 Tax-exempt 103,199 1,136 502 103,833 Residential Mortgage-backed securities: U.S. Government agencies 14,517 2 85 14,434 U.S. Government-sponsored enterprises 19,752 10 231 19,531 Commercial Mortgage-backed securities: U.S. Government-sponsored enterprises 6,315 120 6,195 Total $ 273,742 $ 1,666 $ 2,906 $ 272,502 Held-to-maturity: Tax-exempt state and municipals $ 6,859 $ 152 $ 13 $ 6,998 Residential Mortgage-backed securities: U.S. Government agencies 54 54 U.S. Government-sponsored enterprises 2,361 138 4 2,495 Total $ 9,274 $ 290 $ 17 $ 9,547 The Company had net unrealized losses on available-for-sale securities of $2,568, net of deferred income taxes of $683 at December 31, 2018, and net unrealized losses on available-for-sale securities of $977, net of deferred income taxes of $260, at December 31, 2017. There were no investment securities sales in 2018 and 2017. Proceeds from the sale of investment securities available-for-sale amounted to $27,408 in 2016. Our equity securities portfolio consists of stock of two other financial institutions. At December 31, 2018 and December 31, 2017, we had $291 thousand and $46 thousand, respectively, in equity securities recorded at fair value. Prior to January 1, 2018, equity securities were stated at fair value with unrealized gains and losses reported as a separate component of Accumulated Other Comprehensive Income (“AOCI”), net of tax. At December 31, 2017, net unrealized gains of $3 thousand had been recognized in AOCI. On January 1, 2018, these unrealized gains, net of income tax were reclassified out of AOCI and into retained earnings with subsequent changes in fair value being recognized in net income. At December 31, 2018, the fair value of our equity portfolio exceeded the cost basis by $14. The following is a summary of unrealized and realized gains and losses recognized in net income on equity securities during 2018. Year Ended December 31, 2018 Net gains recognized during the period on equity securities $ 14 Less: Net gains and (losses) recognized during the period on equity securities sold during the period Unrealized gains recognized during the reporting period on equity securities still held at the reporting date $ 14 There were no realized gains or losses on sold investment securities in 2018 or 2017. Gross realized gains totaled $623 in 2016. There were no gross losses in 2016. 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, 2018, is summarized as follows: December 31, 2018 Within one year $ 38,925 After one but within five years 152,806 After five but within ten years 15,900 After ten years 10,586 218,217 Mortgage-backed securities 51,465 Total $ 269,682 Expected maturities will differ from contractual maturities because borrowers have the right to call or prepay obligations with or without call or prepayment penalties. The maturity distribution of the amortized cost and fair value, of debt securities classified as held-to-maturity at December 31, 2018, is summarized as follows: Amortized Fair December 31, 2018 Cost Value Within one year After one but within five years After five but within ten years After ten years $ 6,855 $ 6,824 6,855 6,824 Mortgage-backed securities 1,506 1,556 Total $ 8,361 $ 8,380 Securities with a carrying value of $161,647 and $163,936 at December 31, 2018 and 2017, respectively, were pledged to secure public deposits 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, 2018 and 2017, 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, 2018 and 2017, 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, 2018 Value Losses Value Losses Value Losses U.S. Treasury securities $ 1,995 $ 2 $ 19,671 $ 363 $ 21,666 $ 365 U.S. Government-sponsored enterprises 2,037 1 89,729 2,182 91,766 2,183 State and municipals: Tax-exempt 9,022 74 52,352 714 61,374 788 Residential Mortgage-backed securities: U.S. Government agencies 7,800 84 7,800 84 U.S. Government-sponsored enterprises 12,851 55 13,881 351 26,732 406 Commercial Mortgage-backed securities: U.S. Government-sponsored enterprises 6,039 230 6,039 230 Total $ 25,905 $ 132 $ 189,472 $ 3,924 $ 215,377 $ 4,056 Less Than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized December 31, 2017 Value Losses Value Losses Value Losses U.S. Treasury securities $ 17,350 $ 170 $ 2,464 $ 58 $ 19,814 $ 228 U.S. Government-sponsored enterprises 39,096 445 51,365 1,295 90,461 1,740 State and municipals: Tax-exempt 54,788 454 3,808 61 58,596 515 Residential Mortgage-backed securities: U.S. Government agencies 9,484 39 3,968 46 13,452 85 U.S. Government-sponsored enterprises 12,537 103 6,504 132 19,041 235 Commercial Mortgage-backed securities: U.S. Government-sponsored enterprises 6,195 120 6,195 120 Total $ 139,450 $ 1,331 $ 68,109 $ 1,592 $ 207,559 $ 2,923 The Company had 187 investment securities, consisting of 104 tax-exempt state and municipal obligations, 8 U.S. Treasury securities, 37 U.S. Government-sponsored enterprise securities and 38 mortgage-backed securities that were in unrealized loss positions at December 31, 2018. Of these securities, 7 U.S. Treasury securities, 35 U.S. Government–sponsored enterprise securities, 33 mortgage-backed securities and 88 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, 2018. There was no OTTI recognized for each of the years in the three-year period ended December 31, 2018. Other assets include the Company’s investment in Visa Class B stock. The Company’s ownership includes shares acquired at no cost related to the Company’s prior ownership in Visa's network while Visa operated as a cooperative. The Company holds 44,982 shares of Visa Class B stock which, following resolution of Visa litigation, will be converted to Visa Class A shares (the conversion rate as of December 31, 2018 is 1.6298 shares of Class A stock for each share of Class B stock) for a total of 73,312 shares of Visa Class A stock. There is a very limited market for this stock, as only current owners of Class B shares are permitted to transact in Class B. Due to the lack of orderly trades and public information of such trades, Visa Class B stock has no readily determinable fair value. |
Loans, net and allowance for lo
Loans, net and allowance for loan losses | 12 Months Ended |
Dec. 31, 2018 | |
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, 2018 and 2017 are summarized as follows. Net deferred loan costs included in loan balances were $744 and $575 in 2018 and 2017, respectively. December 31, 2018 December 31, 2017 Commercial $ 494,134 $ 476,199 Real estate: Commercial 907,803 786,210 Residential 299,876 287,935 Consumer 121,453 142,721 Total $ 1,823,266 $ 1,693,065 Loans outstanding to directors, executive officers, principal stockholders or to their affiliates totaled $14,701 and $15,169 at December 31, 2018 and 2017, respectively. Advances and repayments during 2018 totaled $1,657 and $1,947 respectively. There were no related party loans that were classified as nonaccrual, past due, or restructured at December 31, 2018 and 2017. Deposits from related parties amounted to $16.2 million at December 31, 2018 and $10.0 million at December 31, 2017. At December 31, 2018, 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. Therefore, a primary concentration of credit risk is directly related to the real estate market in these regions. 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, 2018, 2017, and 2016 were as follows: Real estate December 31, 2018 Commercial Commercial Residential Consumer Unallocated Total Allowance for loan losses: Beginning balance $ 5,513 $ 8,944 $ 3,111 $ 1,392 $ $ 18,960 Charge-offs (154) (1,250) (405) (545) (2,354) Recoveries 137 136 98 202 573 Provisions 20 2,906 1,088 186 4,200 Ending balance $ 5,516 $ 10,736 $ 3,892 $ 1,235 $ $ 21,379 Ending balance: individually evaluated for impairment 50 403 666 60 1,179 Ending balance: collectively evaluated for impairment $ 5,466 $ 10,333 $ 3,226 $ 1,175 $ 20,200 Loans receivable: Ending balance $ 494,134 $ 907,803 $ 299,876 $ 121,453 $ $ 1,823,266 Ending balance: individually evaluated for impairment 2,237 3,121 4,071 212 9,641 Ending balance: collectively evaluated for impairment $ 491,897 $ 904,682 $ 295,805 $ 121,241 $ $ 1,813,625 Real estate December 31, 2017 Commercial Commercial Residential Consumer Unallocated Total Allowance for loan losses: Beginning balance $ 4,452 $ 7,548 $ 2,961 $ 1,000 $ $ 15,961 Charge-offs (173) (706) (533) (737) (2,149) Recoveries 20 124 44 160 348 Provisions 1,214 1,978 639 969 4,800 Ending balance $ 5,513 $ 8,944 $ 3,111 $ 1,392 $ $ 18,960 Ending balance: individually evaluated for impairment 159 263 336 8 766 Ending balance: collectively evaluated for impairment $ 5,354 $ 8,681 $ 2,775 $ 1,384 $ 18,194 Loans receivable: Ending balance $ 476,199 $ 786,210 $ 287,935 $ 142,721 $ $ 1,693,065 Ending balance: individually evaluated for impairment 2,463 4,289 3,793 177 10,722 Ending balance: collectively evaluated for impairment $ 473,736 $ 781,921 $ 284,142 $ 142,544 $ $ 1,682,343 Real estate December 31, 2016 Commercial Commercial Residential Consumer Unallocated Total Allowance for loan losses: Beginning balance $ 4,113 $ 4,751 $ 3,174 $ 937 $ $ 12,975 Charge-offs (776) (858) (339) (495) (2,468) Recoveries 86 122 69 177 454 Provisions 1,029 3,533 57 381 5,000 Ending balance $ 4,452 $ 7,548 $ 2,961 $ 1,000 $ $ 15,961 Ending balance: individually evaluated for impairment 225 1,197 520 1,942 Ending balance: collectively evaluated for impairment $ 4,227 $ 6,351 $ 2,441 $ 1,000 $ $ 14,019 Loans receivable: Ending balance $ 408,814 $ 700,144 $ 289,781 $ 134,226 $ $ 1,532,965 Ending balance: individually evaluated for impairment 2,687 7,157 3,580 155 13,579 Ending balance: collectively evaluated for impairment $ 406,127 $ 692,987 $ 286,201 $ 134,071 $ $ 1,519,386 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, 2018 and 2017: Special December 31, 2018 Pass Mention Substandard Doubtful Total Commercial $ 491,531 $ 869 $ 1,734 $ $ 494,134 Real estate: Commercial 886,849 8,934 12,020 907,803 Residential 295,758 357 3,761 299,876 Consumer 121,229 224 121,453 Total $ 1,795,367 $ 10,160 $ 17,739 $ $ 1,823,266 Special December 31, 2017 Pass Mention Substandard Doubtful Total Commercial $ 472,185 $ 1,958 $ 2,056 $ $ 476,199 Real estate: Commercial 764,320 13,015 8,875 786,210 Residential 282,484 18 5,433 287,935 Consumer 142,507 214 142,721 Total $ 1,661,496 $ 14,991 $ 16,578 $ $ 1,693,065 Information concerning nonaccrual loans by major loan classification at December 31, 2018 and 2017 is summarized as follows: 2018 2017 Commercial $ 776 $ 860 Real estate: Commercial 2,663 3,821 Residential 2,580 2,994 Consumer 212 177 Total $ 6,231 $ 7,852 The major classification of loans by past due status at December 31, 2018 and 2017 are summarized as follows: Greater Loans > 90 30-59 Days 60-89 Days than 90 Total Past Days and December 31, 2018 Past Due Past Due Days Due Current Total Loans Accruing Commercial $ 973 $ 79 $ 776 $ 1,828 $ 492,306 $ 494,134 Real estate: Commercial 1,889 218 2,736 4,843 902,960 907,803 $ 73 Residential 2,486 1,545 3,430 7,461 292,415 299,876 850 Consumer 756 292 212 1,260 120,193 121,453 Total $ 6,104 $ 2,134 $ 7,154 $ 15,392 $ 1,807,874 $ 1,823,266 $ 923 Greater Loans > 90 30-59 Days 60-89 Days than 90 Total Past Days and December 31, 2017 Past Due Past Due Days Due Current Total Loans Accruing Commercial $ 124 $ 216 $ 860 $ 1,200 $ 474,999 $ 476,199 Real estate: Commercial 1,722 194 3,821 5,737 780,473 786,210 Residential 1,134 1,551 3,543 6,228 281,707 287,935 $ 549 Consumer 1,101 364 363 1,828 140,893 142,721 186 Total $ 4,081 $ 2,325 $ 8,587 $ 14,993 $ 1,678,072 $ 1,693,065 $ 735 The following tables summarize information concerning impaired loans as of and for the years ended December 31, 2018, 2017 and 2016 by major loan classification: For the Year Ended Unpaid Average Interest Recorded Principal Related Recorded Income December 31, 2018 Investment Balance Allowance Investment Recognized With no related allowance: Commercial $ 1,562 $ 1,900 $ 1,318 $ 67 Real estate: Commercial 1,969 2,299 2,822 28 Residential 1,970 2,658 2,193 22 Consumer 152 160 135 Total 5,653 7,017 6,468 117 With an allowance recorded: Commercial 675 675 50 1,006 30 Real estate: Commercial 1,152 1,323 403 1,676 18 Residential 2,101 2,328 666 1,585 22 Consumer 60 60 60 21 Total 3,988 4,386 1,179 4,288 70 Total impaired loans Commercial 2,237 2,575 50 2,324 97 Real estate: Commercial 3,121 3,622 403 4,498 46 Residential 4,071 4,986 666 3,778 44 Consumer 212 220 60 156 Total $ 9,641 $ 11,403 $ 1,179 $ 10,756 $ 187 For the Year Ended Unpaid Average Interest Recorded Principal Related Recorded Income December 31, 2017 Investment Balance Allowance Investment Recognized With no related allowance: Commercial $ 1,279 $ 1,439 $ 1,668 $ 43 Real estate: Commercial 2,888 3,190 2,985 24 Residential 2,196 2,672 2,227 21 Consumer 169 181 173 Total 6,532 7,482 7,053 88 With an allowance recorded: Commercial 1,184 1,218 159 991 50 Real estate: Commercial 1,401 1,496 263 2,202 18 Residential 1,597 1,759 336 1,335 23 Consumer 8 8 8 20 Total 4,190 4,481 766 4,548 91 Total impaired loans Commercial 2,463 2,657 159 2,659 93 Real estate: Commercial 4,289 4,686 263 5,187 42 Residential 3,793 4,431 336 3,562 44 Consumer 177 189 8 193 Total $ 10,722 $ 11,963 $ 766 $ 11,601 $ 179 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 $ 2,404 $ 3,213 $ 1,461 $ Real estate: Commercial 2,364 3,018 4,300 Residential 2,205 2,388 2,133 Consumer 155 155 147 Total 7,128 8,774 8,041 154 With an allowance recorded: Commercial 283 283 $ 225 859 Real estate: Commercial 4,793 4,793 1,197 2,366 2 Residential 1,375 1,376 520 1,185 7 Consumer 50 Total 6,451 6,452 1,942 4,460 9 Total impaired loans Commercial 2,687 3,496 225 2,320 48 Real estate: Commercial 7,157 7,811 1,197 6,666 73 Residential 3,580 3,764 520 3,318 42 Consumer 155 155 197 Total $ 13,579 $ 15,226 $ 1,942 $ 12,501 $ 163 There were no amounts of interest income recognized using the cash-basis method on impaired loans for the years ended December 31, 2018, 2017 and 2016. Included in the commercial loan, commercial real estate and residential real estate categories are troubled debt restructurings that were classified as impaired. Trouble debt restructurings totaled $2,779 and $3,074 at December 31, 2018 and 2017 respectively. There was one loan modified in 2018, six loans modified in 2017 and three loans modified in 2016 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, 2018 and 2017 and 2016. Pre-Modification Post-Modification Number Outstanding Recorded Outstanding Recorded December 31, 2018 of Contracts Investment Recorded Investment Investment Commercial real estate 1 $ 340 $ 340 $ 340 Total 1 $ 340 $ 340 $ 340 Pre-Modification Post-Modification Number Outstanding Recorded Outstanding Recorded December 31, 2017 of Contracts Investment Recorded Investment Investment Commercial 2 $ 885 $ 885 $ 864 Commercial real estate 3 721 721 700 Residential mortgage 1 64 64 64 Total 6 $ 1,670 $ 1,670 $ 1,628 Pre-Modification Post-Modification Number Outstanding Recorded Outstanding Recorded December 31, 2016 of Contracts Investment Recorded Investment Investment Commercial 1 $ 1,500 $ 1,150 $ 1,150 Commercial real estate Residential mortgage 2 216 216 207 Total 3 $ 1,716 $ 1,366 $ 1,357 There were no payment defaults within 12 months of its modification on loans considered troubled debt restructurings for the years ended December 31, 2018 and December 31, 2017 and one payment default for the year ended December 31, 2016 totaling $43. The amount of residential loans in the formal process of foreclosure totaled $1,823 at December 31, 2018 and $1,684 at December 31, 2017. |
Off-balance sheet financial ins
Off-balance sheet financial instruments | 12 Months Ended |
Dec. 31, 2018 | |
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. The Company records a valuation allowance for off-balance sheet credit losses, if deemed necessary, separately as a liability. The allowance is not significant. The contractual amounts of off-balance sheet commitments at December 31, 2018 and 2017 are summarized as follows: December 31 2018 2017 Commitments to extend credit $ 294,122 $ 324,984 Unused portions of lines of credit 51,790 56,244 Standby letters of credit 33,275 23,387 $ 379,187 $ 404,615 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 $22,415 at December 31, 2018 and $14,049 at December 31, 2017. The carrying value of the liability for the Company’s obligations under guarantees for standby letters of credit was not material at December 31, 2018 and 2017. |
Premises and equipment, net
Premises and equipment, net | 12 Months Ended |
Dec. 31, 2018 | |
Premises and equipment, net | |
Premises and equipment, net | 6. Premises and equipment, net: Premises and equipment at December 31, 2018 and 2017 are summarized as follows: December 31 2018 2017 Land $ 5,535 $ 5,875 Premises and leasehold improvements 44,813 42,472 Furniture, fixtures and equipment 14,812 13,249 65,160 61,596 Less: accumulated depreciation 26,271 24,039 $ 38,889 $ 37,557 Pursuant to the terms of non-cancelable lease agreements in effect at December 31, 2018, pertaining to banking premises and equipment, future minimum annual rent commitments under various operating leases are summarized as follows: 2019 $ 532 2020 527 2021 514 2022 516 2023 432 Thereafter 5,024 $ 7,545 The leases contain options to extend for periods from one to ten years which if reasonably certain to exercised, the cost of such options is included in the annual rental commitments. Rent expense for the years ended December 31, 2018, 2017 and 2016 amounted to $492, $407 and $416, respectively. |
Intangible assets, net
Intangible assets, net | 12 Months Ended |
Dec. 31, 2018 | |
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, 2018 and 2017. The gross carrying amount of trade name intangible assets totaled $203 at December 31, 2018 and 2017. 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, 2018 and 2017. The accumulated amortization on core deposit intangible assets was $6,515 and $5,810 at December 31, 2018 and 2017, respectively. The accumulated amortization on trade name intangible assets was $149 and $128 at December 31, 2018 and 2017, respectively. The accumulated amortization on the asset management and retirement plan services intangible asset was $480 and $324 at December 31, 2018 and 2017, respectively. The estimated amortization expense on intangible assets in years subsequent to December 31, 2018, is as follows: 2019 $ 730 2020 606 2021 491 2022 363 2023 106 Total $ 2,296 |
Other assets
Other assets | 12 Months Ended |
Dec. 31, 2018 | |
Other assets. | |
Other assets | 8. Other assets: The major components of other assets at December 31, 2018 and 2017 are summarized as follows: December 31, 2018 December 31, 2017 Other real estate owned $ 376 $ 284 Investment in low income housing partnership 7,377 7,842 Mortgage servicing rights 718 728 Bank owned life insurance 34,288 33,836 Restricted equity securities 7,462 8,562 Net deferred tax asset 5,081 3,906 Other assets 8,435 9,311 Total $ 63,737 $ 64,469 The Company originates one-to-four family residential mortgage loans for sale in the secondary market with servicing rights retained. Mortgage loans serviced for others are not included in the accompanying Consolidated Balance Sheets. The unpaid principal balances of mortgage loans serviced for others were $165,610 at December 31, 2018 and $174,017 at December 31, 2017. |
Deposits
Deposits | 12 Months Ended |
Dec. 31, 2018 | |
Deposits. | |
Deposits | 9. Deposits: The major components of interest-bearing and noninterest-bearing deposits at December 31, 2018 and 2017 are summarized as follows: December 31 2018 2017 Interest-bearing deposits: Money market accounts $ 328,949 $ 278,494 Now accounts 421,414 389,734 Savings accounts 378,157 387,827 Time deposits less than $250 250,456 220,812 Time deposits $250 or more 85,786 61,422 Total interest-bearing deposits 1,464,762 1,338,289 Noninterest-bearing deposits 410,260 380,729 Total deposits $ 1,875,022 $ 1,719,018 The aggregate amounts of maturities for all time deposits at December 31, 2018, are summarized as follows: 2019 $ 154,506 2020 52,824 2021 83,959 2022 12,895 2023 19,438 Thereafter 12,620 $ 336,242 The aggregate amount of deposits reclassified as loans was $343 at December 31, 2018, and $298 at December 31, 2017. 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, 2018 | |
Short-term borrowings | |
Short-term borrowings | 10. Short-term borrowings: Short-term borrowings consisted of FHLB advances representing overnight or less than 30-day borrowings at December 31, 2018, 2017 and 2016: At and for the year ended December 31, 2018 Weighted Weighted Maximum Average Average Ending Average Month-End Rate for Rate at End Balance Balance Balance the Year of the Year FHLB advances $ 86,500 $ 133,834 $ 189,275 2.05 % 2.62 % At and for the year ended December 31, 2017 Weighted Weighted Maximum Average Average Ending Average Month-End Rate for Rate at End Balance Balance Balance the Year of the Year FHLB advances $ 123,675 $ 76,846 $ 123,675 1.17 % 1.54 % 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 FHLB advances $ 82,700 $ 67,553 $ 86,300 0.60 % 0.74 % The Company has an agreement with the FHLB which allows for borrowings up to its maximum borrowing capacity based on a percentage of qualifying collateral assets. At December 31, 2018, the maximum borrowing capacity was $700,169 of which $124,406 was outstanding in borrowings and $171,970 was used to issue standby letters of credit to collateralize public fund deposits. Advances with the FHLB 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. The Company also has unsecured line of credit agreements with two correspondent banks, where the total line amount was $18,000 at December 31, 2018 and 2017. There were no amounts outstanding on either line of credit at December 31, 2018 or 2017. Interest on these borrowings accrues daily based on the daily federal funds rate. |
Long-term debt
Long-term debt | 12 Months Ended |
Dec. 31, 2018 | |
Long-term debt. | |
Long-term debt | 11. Long-term debt: Long-term debt consisting of advances from the FHLB at December 31, 2018 and 2017 are as follows: Interest Rate Due Fixed Adjustable 2018 2017 April 2018 3.83 % $ 40 December 2018 1.27 10,000 December 2019 4.28 % 3,000 3,000 December 2019 4.01 6,300 6,300 December 2019 1.62 10,000 10,000 June 2020 1.74 5,000 5,000 December 2020 1.84 5,000 5,000 March 2023 4.69 8,606 10,394 $ 37,906 $ 49,734 Maturities of long-term debt, by contractual maturity, in years subsequent to December 31, 2018 are as follows: 2019 $ 21,174 2020 11,963 2021 2,058 2022 2,156 2023 555 $ 37,906 None of the advances from the FHLB are convertible. At December 31, 2018, long-term debt consist of $28,606 at fixed rates and $9,300 at adjustable rates which reset quarterly based on three-month Libor plus 1.21% to plus 1.57%. There were no new long-term advances entered into with the FHLB during 2018 or 2017. |
Fair value of financial instrum
Fair value of financial instruments | 12 Months Ended |
Dec. 31, 2018 | |
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, 2018 and 2017 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, 2018 Amount (Level 1) (Level 2) (Level 3) U.S. Treasury securities $ 25,592 $ 25,592 $ U.S. Government-sponsored enterprises 92,818 $ 92,818 State and Municipals: Taxable 13,853 13,853 Tax-exempt 85,954 85,954 Mortgage-backed securities: U.S. Government agencies 12,629 12,629 U.S. Government-sponsored enterprises 38,836 38,836 Common equity securities 291 291 Interest rate floor - other assets 553 553 Interest rate swap-other assets 108 108 Interest rate swap-other liabilities (138) (138) Total $ 270,496 $ 25,883 $ 244,613 $ Fair Value Measurement Using Quoted Prices in Significant Significant Active Markets for Other Observable Unobservable Identical Assets Inputs Inputs December 31, 2017 Amount (Level 1) (Level 2) (Level 3) U.S. Treasury securities $ 19,814 $ 19,814 $ U.S. Government-sponsored enterprises 93,648 $ 93,648 State and Municipals: Taxable 15,047 15,047 Tax-exempt 103,833 103,833 Mortgage-backed securities: U.S. Government agencies 14,434 14,434 U.S. Government-sponsored enterprises 25,726 25,726 Common equity securities 46 46 Interest rate swap-other assets 655 655 Interest rate swap-other liabilities (733) (733) Total $ 272,470 $ 19,860 $ 252,610 $ Assets and liabilities measured at fair value on a nonrecurring basis at December 31, 2018 and 2017 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, 2018 Amount (Level 1) (Level 2) (Level 3) Impaired loans $ 2,809 $ 2,809 Other real estate owned $ 234 $ 234 Fair Value Measurement Using Quoted Prices in Significant Other Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs December 31, 2017 Amount (Level 1) (Level 2) (Level 3) Impaired loans $ 3,424 $ 3,424 Other real estate owned $ 216 $ 216 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, 2018 Estimate Valuation Techniques Unobservable Input (Weighted Average) Impaired loans $ 2,809 Appraisal of collateral Appraisal adjustments 7.1% to 97.0% (61.8)% Liquidation expenses 3.0% to 6.0% (4.4)% Other real estate owned $ 234 Appraisal of collateral Appraisal adjustments 26.0% to 73.3% (38.9)% Liquidation expenses 3.0% to 6.0% (5.0)% Quantitative Information about Level 3 Fair Value Measurements Fair Value Range December 31, 2017 Estimate Valuation Techniques Unobservable Input (Weighted Average) Impaired loans $ 3,424 Appraisal of collateral Appraisal adjustments 4.0% to 97.0% (67.2)% Liquidation expenses 3.0% to 6.0% (4.9)% Other real estate owned $ 216 Appraisal of collateral Appraisal adjustments 25.0% to 41.3% (30.7)% 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, 2018 and 2017 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, 2018 Value Value (level 1) (level 2) (Level 3) Financial assets: Cash and cash equivalents $ 32,616 $ 32,616 $ 32,616 Investment securities: Available-for-sale 269,682 269,682 25,592 $ 244,090 Common equity securities 291 291 291 Held-to-maturity 8,361 8,380 8,380 Loans held for sale 749 749 749 Net loans 1,801,887 1,762,449 $ 1,762,449 Accrued interest receivable 7,115 7,115 7,115 Mortgage servicing rights 718 1,710 1,710 Restricted equity securities 7,462 7,462 7,462 Interest rate floor 553 553 553 Interest rate swaps 108 108 108 Total $ 2,129,542 $ 2,091,115 Financial liabilities: Deposits $ 1,875,022 $ 1,874,520 $ 1,874,520 Short-term borrowings 86,500 86,500 86,500 Long-term debt 37,906 38,071 38,071 Accrued interest payable 1,195 1,195 1,195 Interest rate swaps 138 138 138 Total $ 2,000,761 $ 2,000,424 Fair Value Hierarchy Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable Carrying Fair Assets Inputs Inputs December 31, 2017 Value Value (level 1) (level 2) (Level 3) Financial assets: Cash and cash equivalents $ 37,488 $ 37,488 $ 37,488 Investment securities: Available-for-sale 272,548 272,548 19,860 $ 252,688 Held-to-maturity 9,274 9,547 9,547 Loans held for sale 106 106 106 Net loans 1,674,105 1,645,292 $ 1,645,292 Accrued interest receivable 6,936 6,936 6,936 Mortgage servicing rights 728 1,638 1,638 Restricted equity securities 8,562 8,562 8,562 Interest rate swaps 655 655 655 Total $ 2,010,402 $ 1,982,772 Financial liabilities: Deposits $ 1,719,018 $ 1,666,284 $ 1,666,284 Short-term borrowings 123,675 123,675 123,675 Long-term debt 49,734 50,147 50,147 Accrued interest payable 497 497 497 Interest rate swaps 733 733 733 Total $ 1,893,657 $ 1,841,336 |
Derivatives and hedging activit
Derivatives and hedging activities | 12 Months Ended |
Dec. 31, 2018 | |
Derivatives and hedging activities | |
Derivatives and hedging activities | 13. Derivatives and hedging activities Risk Management Objective of Using Derivatives The Company is exposed to certain risk arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its assets and liabilities and the use of derivative financial instruments. Specifically, the Company enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates. The Company’s derivative financial instruments are used to manage differences in the amount, timing, and duration of the Company’s known or expected cash receipts principally related to the Company’s assets. Cash Flow Hedges of Interest Rate Risk The Company’s objectives in using interest rate derivatives are to add stability to interest income and to manage its exposure to interest rate movements. To accomplish this objective, the Company primarily uses interest rate floors as part of its interest rate risk management strategy. Interest rate floors designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty if interest rates fall below the strike rate on the contract in exchange for an up-front premium. For derivatives designated and that qualify as cash flow hedges of interest rate risk, the gain or loss on the derivative is recorded in Accumulated Other Comprehensive Loss and subsequently reclassified into interest income in the same period(s) during which the hedged transaction affects earnings. Gains and losses on the derivative representing hedge components excluded from the assessment of effectiveness are recognized over the life of the hedge on a systematic and rational basis. The earnings recognition of excluded components is presented in interest income. Amounts reported in accumulated other comprehensive loss related to derivatives will be reclassified to interest income as interest payments are received on the Company’s variable-rate assets. During 2019, the Company estimates that an additional $64 will be reclassified as a reduction to interest income. Non-designated Hedges Derivatives not designated as hedges are not speculative and result from a service the Company provides to certain customers, which the Company implemented during the third quarter of 2017. The Company executes interest rate swaps with commercial banking customers to facilitate their respective risk management strategies. Those interest rate swaps are simultaneously hedged by offsetting interest rate swaps that the Company executes with a third party, such that the Company minimizes its net risk exposure resulting from such transactions. As the interest rate swaps associated with this program do not meet the strict hedge accounting requirements, changes in the fair value of both the customer swaps and the offsetting swaps are recognized directly in earnings. As of December 31, 2018, the Company had 12 interest rate swaps with an aggregate notional amount of $62,071 related to this program. Fair Values of Derivative Instruments on the Balance Sheet The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the Consolidated Balance Sheets as of December 31, 2018 and December 31, 2017. Asset Derivatives Asset Derivatives Liability Derivatives Liability Derivatives As of December 31, 2018 As of December 31, 2017 (1) As of December 31, 2018 As of December 31, 2017 (2) Notional Balance Sheet Balance Sheet Balance Sheet Balance Sheet Amount Location Fair Value Location Fair Value Location Fair Value Location Fair Value Derivatives designated as hedging instruments Interest Rate Floor 25,000 Other Assets $ Total derivatives designated as hedging instruments $ Derivatives not designated as hedging instruments Interest Rate Swaps 62,071 Other Assets $ 108 Other Assets $ 655 Other Liabilities $ 138 Other Liabilities $ 733 Total derivatives not designated as hedging instruments $ 108 $ 655 $ 138 $ 733 (1) Assets amount does not include accrued interest receivable of $28 (2) Liabilities amount does not include accrued interest payable of $28 Effect of Fair Value and Cash Flow Hedge Accounting on Accumulated Other Comprehensive Loss The table below presents the effect of fair value and cash flow hedge accounting on Accumulated Other Comprehensive Loss as of December 31, 2018 and December 31, 2017. Location of Amount of Amount of Amount of Amount of Amount of Gain or (Loss) Amount of Gain Loss Loss Gain Gain Recognized from Loss Reclassified Reclassified Recognized in Recognized in Recognized in Accumulated Reclassified from Accumulated from Accumulated Derivatives in OCI on OCI Included OCI Excluded Other Comprehensive from Accumulated OCI into Income OCI into Income Hedging Derivative Component Component Income into OCI into Income Included Component Excluded Component Relationships 2018 Income 2018 Derivatives in Cash Flow Hedging Relationships Interest Rate Floor (*) 243 109 134 Interest Income (3) 13 (16) Total 243 109 134 (3) 13 (16) * Amounts disclosed are gross and not net of taxes. Effect of Fair Value and Cash Flow Hedge Accounting on the Income Statement The table below presents the effect of the Company’s derivative financial instruments on the Consolidated Statements of Income and Comprehensive Income as of December 31, 2018 and December 31, 2017. Location and Amount of Gain or (Loss) Recognized in Income on Fair Value and Cash Flow Hedging Relationships 2018 2017 Interest Income Interest Income Total amounts of income and expense line items presented in the statement of financial performance in which the effects of fair value or cash flow hedges are recorded (3) The effects of fair value and cash flow hedging: Gain or (loss) on cash flow hedging relationships Interest contracts Amount of gain or (loss) reclassified from accumulated other comprehensive income into income (3) Amount of gain or (loss) reclassified from accumulated other comprehensive income into income - included component 13 Amount of gain or (loss) reclassified from accumulated other comprehensive income into income - excluded component (16) Effect of Other Derivative Instruments on the Income Statement The tables below present the effect of the Company’s other derivative financial instruments on the Consolidated Statements of Income and Comprehensive Income for the years ended December 31, 2018 and 2017. Amount of Gain Amount of Loss Recognized in Recognized in Location of Gain or (Loss) Income Income Recognized in Income on Twelve Months Ended Twelve Months Ended Derivatives Not Designated as Hedging Instruments Derivative December 31, 2018 December 31, 2017 Interest Rate Swaps Other non-interest income $ 49 $ (79) Fee Income Other income / (expense) $ 53 $ 792 Offsetting Derivatives The table below presents a gross presentation, the effects of offsetting, and a net presentation of the Company’s derivatives as of December 31, 2018 and December 31, 2017. The net amounts of derivative assets or liabilities can be reconciled to the tabular disclosure of fair value. The tabular disclosure of fair value provides the location that derivative assets and liabilities are presented on the Consolidated Balance Sheets. Offsetting of Derivative Assets as of December 31, 2018 Gross Amounts Net Amounts Gross Amounts Not Offset in the Statement of Financial Position Gross Offset in the of Assets Amounts of Statement of presented in the Recognized Financial Statement of Financial Cash Collateral Net Assets Position Financial Position Instruments Received Amount Derivatives $ 661 $ $ 661 $ $ 661 Offsetting of Derivative Liabilities as of December 31, 2018 Gross Amounts Net Amounts Gross Amounts Not Offset in the Statement of Financial Position Gross Offset in the of Assets Amounts of Statement of presented in the Recognized Financial Statement of Financial Cash Collateral Net Assets Position Financial Position Instruments Received Amount Derivatives $ 138 $ $ 138 $ $ 138 Offsetting of Derivative Assets as of December 31, 2017 Gross Amounts Net Amounts Gross Amounts Not Offset in the Statement of Financial Position Gross Offset in the of Assets Amounts of Statement of presented in the Recognized Financial Statement of Financial Cash Collateral Net Assets Position Financial Position Instruments Received Amount Derivatives $ 655 $ $ 655 $ $ 655 Offsetting of Derivative Liabilities as of December 31, 2017 Gross Amounts Net Amounts Gross Amounts Not Offset in the Statement of Financial Position Gross Offset in the of Assets Amounts of Statement of presented in the Recognized Financial Statement of Financial Cash Collateral Net Assets Position Financial Position Instruments Received Amount Derivatives $ 733 $ $ 733 $ $ 733 Credit-risk-related Contingent Features The Company has agreements with certain of its derivative counterparties that contain a provision where if the Company defaults on any of its indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, then the Company could also be declared in default on its derivative obligations. The Company also has agreements with certain of its derivative counterparties that contain a provision where if the Company fails to maintain its status as a well capitalized institution, then the counterparty could terminate the derivative positions and the Company would be required to settle its obligations under the agreements. The Company has agreements with certain of its derivative counterparties that contain provisions that require the Company’s debt to maintain an investment grade credit rating from each of the major credit rating agencies. If the Company’s credit rating is reduced below investment grade then a termination event shall be deemed to have occurred and the non-affected counterparty shall have the right but not obligation to terminate all affected transactions under the agreement. As of December 31, 2018 the termination value of derivatives in a net liability position, which includes accrued interest but excludes any adjustment for nonperformance risk, related to these agreements was $29. The Company has minimum collateral posting thresholds with certain of its derivative counterparties under these agreements. The Company was in compliance with the terms of the above noted agreements at December 31, 2018. |
Stock plans
Stock plans | 12 Months Ended |
Dec. 31, 2018 | |
Stock plans | |
Stock plans | 14. Stock plans: The 2008 long-term incentive plan (“2008 Plan”) allowed for eligible participants to be granted equity awards. No awards may be made under the 2008 Plan after January 15, 2018. In May 2017, the Company’s stockholders approved the 2017 equity incentive plan (“2017 Plan”). The 2017 Plan allows for eligible participants to be granted equity awards. Under the 2017 Plan the Compensation Committee of the Board of Directors has the authority to, among other things: · Select the persons to be granted awards under the 2017 Plan. · Determine the type, size and term of awards. · Determine whether such performance objectives and conditions have been met. · Accelerate the vesting or excercisability of an award. Persons eligible to receive awards under the 2008 Plan and 2017 Plan include directors, officers, employees, consultants and other service providers of the Company and its subsidiaries. As of December 31, 2018, 86,994 shares of the Company’s common stock were available for grant as awards pursuant to the 2017 Plan. The 2008 Plan expired in January 2018 but will remain in effect in accordance with its terms to govern outstanding awards under that plan. If any outstanding awards under the 2017 Plan are forfeited by the holder or canceled by the Company, the underlying shares would be available for regrant to others. The 2017 Plan authorizes grants of stock options, stock appreciation rights, cash awards, performance awards, restricted stock and restricted stock units. In 2018, the Company awarded 2,548 shares of non-performance-based restricted stock and 8,920 performance-based restricted stock units under the 2017 Plan. In 2017, the Company awarded 2,362 shares of non-performance-based restricted stock and 8,266 performance-based restricted stock units under the 2008 Plan. A total of 10,542 restricted stock awards granted under the 2008 Plan vested in 2017. In 2018, 114 shares of non-performance-based restricted stock granted under the 2017 Plan vested along with 2,493 shares of non-performance-based restricted stock granted under the 2008 Plan. The non-performance restricted stock grants made in 2018 and 2017 vest equally over three years from the grant date. Grants of restricted stock made in prior periods cliff vest after five years. The performance-based restricted stock units vest three years after the grant date and include conditions based on the Company’s three year cumulative diluted earnings per share and three-year average return on equity that determines the number of restricted stock units that may vest. The activity related to restricted stock for each of the years ended December 31, 2018, 2017 and 2016 was as follows: Year Ended December 31 2018 2017 2016 Nonvested, January 1 12,448 12,362 14,309 Granted shares 11,468 10,628 Vested shares 2,607 10,542 1,947 Forfeited shares Nonvested, December 31 21,309 12,448 12,362 The Company expenses the fair value of all-share based compensation over the requisite service period commencing at grant date. The fair value of restricted stock is expensed on a straight-line basis. The Company periodically assesses the probability of achievement of the performance criteria and adjusts the amount of compensation expense accordingly. Compensation is recognized over the vesting period and adjusted for the probability of achievement of the performance criteria. The Company classifies share-based compensation for employees within “salaries and employee benefits expense” on the Consolidated Statements of Income and Comprehensive Income. In 2018, the Company recognized $272 for awards granted under the 2017 Plan. In 2017, the Company recognized $21 for awards granted under the 2017 Plan and $156 for awards granted under the 2008 Plan. The Company recognized $71 of compensation expense for the year ended December 31, 2016 for awards granted under the 2008 Plan. As of December 31, 2018, the Company had $525 of unrecognized compensation expense associated with restricted stock awards. The remaining cost is expected to be recognized over a weighted average vesting period of 1.7 years. |
Employee benefit plans
Employee benefit plans | 12 Months Ended |
Dec. 31, 2018 | |
Employee benefit plans | |
Employee benefit plans | 15. Employee benefit plans: The Company sponsors a separate Employee Stock Ownership Plan (“ESOP”) and Retirement Profit Sharing 401(k) Plan. The Company also maintains Supplemental Executive Retirement Plans (“SERP”), and an Employees’ Pension Plan, which is currently frozen. Under the ESOP, amounts voted by the Company’s Board of Directors are paid into the ESOP and each participant is credited with an amount 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 Retirement Profit Sharing Plan, amounts approved by the Board of Directors have been paid into a fund and each participant was credited with an amount in proportion to their annual compensation. Upon retirement, death or termination, each participant 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 participants may elect deferrals of up to the maximum amounts permitted by law. The Company contributed $197, $185 and $156 to the ESOP in 2018, 2017 and 2016. In addition, the Company contribution of $1,047, $923 and $786 to the Retirement Profit Sharing Plan in 2018, 2017 and 2016, was comprised of a safe harbor contribution of $578, $509 and $446 and a discretionary match of $469, $414 and $340. The Company established a SERP Plan to replace certain 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 $116 and $96 at December 31, 2018 and 2017, respectively. The expense associated with the plan was $20, $20 and $13 for 2018, 2017 and 2016 respectively. The Company has SERPs for the benefit of certain officers. At December 31, 2018 and 2017, other liabilities include $1,845 and $1,594 accrued under the Plans. Compensation expense includes approximately $335, $314, and $254 relating to these SERPs for the years ended December 31, 2018, 2017 and 2016, respectively. Under the 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 the Company. Information related to the Employees’ Pension Plan is as follows: Pension Benefits December 31 2018 2017 Change in benefit obligation: Benefit obligation, beginning $ 16,935 $ 16,703 Interest cost 623 650 Change in experience gain 135 (13) Change in actuarial assumptions loss (gain) (546) 395 Benefits paid (809) (800) Benefit obligation, ending 16,338 16,935 Change in plan assets: Fair value of plan assets, beginning 13,264 12,644 Actual return on plan assets (236) 1,420 Employer contributions 2,700 Benefits paid (809) (800) Fair value of plan assets, ending 14,919 13,264 Funded status at end of year $ (1,419) $ (3,671) The Society of Actuaries released new mortality tables in 2018 and 2017 which the Company utilized in its pension plan remeasurements at December 31, 2018 and 2017. The change in mortality assumption resulted in a decrease to the benefit obligation of $546 in 2018 and an increase of $395 in 2017. Amounts recognized in the consolidated balance sheets are as follows: Pension Benefits December 31 2018 2017 Liabilities $ 1,419 $ 3,671 Amounts recognized in the accumulated other comprehensive loss consist of: Net actuarial gain (7,218) (6,628) Deferred taxes 1,516 1,392 Net amount recognized $ (5,702) $ (5,236) The accumulated benefit obligation for the defined benefit pension plan was $16,338 and $16,935 at December 31, 2018 and 2017, respectively. Components of net periodic pension income and other amounts recognized in other comprehensive loss are as follows: Pension Benefits Years Ended December 31, 2018 2017 2016 Net periodic pension income: Interest cost $ 623 $ 650 $ 665 Expected return on plan assets (960) (915) (893) Amortization of unrecognized net loss 194 195 209 Net periodic pension income: (143) (70) (19) Other changes in plan assets and benefit obligations recognized in other comprehensive income (loss): Net loss (gain) (590) 318 917 Deferred tax 124 (67) (321) Total recognized in other comprehensive loss (466) 251 596 Total recognized in net period pension cost and other comprehensive loss $ (609) $ 181 $ 577 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 $223. Weighted-average assumptions used to determine benefit obligations and related expenses were as follows: Pension Benefits December 31, Discount rate: Obligation 3.75 % 4.00 % 4.00 % Expense 4.00 3.75 4.00 Expected long-term return on plan assets 7.50 % 7.50 % 7.50 % 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, 2018 and 2017, by asset category are as follows: December 31, 2018 2017 Asset Category: Cash and cash equivalents 5.0 % 4.1 % Equity securities 56.2 57.4 Corporate bonds 23.6 27.6 U.S. Government securities 15.2 10.9 % % Fair value measurement of pension plan assets at December 31, 2018 and 2017 is as follows: Quoted Prices in Active Markets Significant Significant for Identical Observable Observable Assets Inputs Inputs December 31, 2018 Total (Level 1) (Level 2) (Level 3) Cash $ 743 $ 743 $ Equity securities: U.S. large cap 7,687 7,687 International 694 694 Fixed income securities: U.S. Treasuries 192 $ 192 U.S. Government agencies 2,085 2,085 Corporate bonds 3,518 3,518 Total $ 14,919 $ 9,124 $ 5,795 $ Quoted Prices in Active Markets Significant Significant for Identical Observable Observable Assets Inputs Inputs December 31, 2017 Total (Level 1) (Level 2) (Level 3) Cash $ 539 $ 539 $ Equity securities: U.S. large cap 7,269 7,269 International 350 350 Fixed income securities: U.S. Treasuries 198 $ 198 U.S. Government agencies 1,247 1,247 Corporate bonds 3,661 3,661 Total $ 13,264 $ 8,158 $ 5,106 $ 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, 2018 or 2017. The Company has not determined the amount of the expected contribution to the Employees’ Pension Plan for 2019. 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 2019 $ 843 2020 857 2021 858 2022 896 2023 912 Thereafter 5,028 |
Income taxes
Income taxes | 12 Months Ended |
Dec. 31, 2018 | |
Income taxes | |
Income taxes | 16. Income taxes: The current and deferred amounts of the provision for income taxes expense (benefit) for each of the years ended December 31, 2018, 2017 and 2016 are summarized as follows: Year Ended December 31 2018 2017 2016 Current $ 4,072 $ 6,515 $ 6,450 Deferred (681) 1,665 (1,442) Total $ 3,391 $ 8,180 $ 5,008 The components of the net deferred tax asset at December 31, 2018 and 2017 are summarized as follows: December 31 2018 2017 Deferred tax assets: Allowance for loan losses $ 4,490 $ 3,981 Defined benefit plan 1,516 1,392 Deferred compensation 593 499 Deferred loan fees 470 264 Investment securities available-for-sale 683 260 Other 116 106 Total 7,868 6,502 Deferred tax liabilities: Premises and equipment, net 985 815 Merger related accounting 1,083 1,243 Deferred loan costs 626 531 Investment securities available-for-sale Other 93 7 Total 2,787 2,596 Net deferred tax asset $ 5,081 $ 3,906 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 21.0 percent for the year ended December 31, 2018, and 35.0 percent for the years ended December 31, 2017 and 2016 is summarized as follows: Year Ended December 31 2018 2017 2016 Federal income tax at statutory rate $ 5,945 $ 9,323 $ 8,607 Effect of federal income tax rate changes (Note 1) 2,623 Tax exempt interest (1,320) (2,157) (2,264) Life insurance investment income (236) (269) (277) Residential housing program tax credits (1,094) (1,095) (1,128) Other, net 96 (245) 70 Total $ 3,391 $ 8,180 $ 5,008 |
Parent Company financial statem
Parent Company financial statements | 12 Months Ended |
Dec. 31, 2018 | |
Parent Company financial statements | |
Parent Company financial statements | 17. Parent Company financial statements: CONDENSED BALANCE SHEETS December 31 2018 2017 Assets: Cash and cash equivalents $ 3,736 $ 3,932 Equity securities 291 46 Investment in bank subsidiary 272,617 259,147 Due from subsidiaries 1,974 1,900 Other assets 35 Total assets $ 278,653 $ 265,025 Liabilities and Stockholders’ Equity: Other liabilities $ 39 $ 49 Stockholders’ equity 278,614 264,976 Total liabilities and stockholders’ equity $ 278,653 $ 265,025 CONDENSED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME Year Ended December 31 2018 2017 2016 Income: Dividends from subsidiaries $ 9,691 $ 9,319 $ 9,170 Other income 72 52 46 Unrealized holding gains on equity securities 13 Total income 9,776 9,371 9,216 Expense: Other expenses 214 205 259 Total expenses 214 205 259 Income before taxes and undistributed income 9,562 9,166 8,957 Income tax benefit (27) (54) (75) Income before undistributed income of subsidiaries 9,589 9,220 9,032 Equity in undistributed net income of subsidiaries 15,331 9,237 10,551 Net income $ 24,920 $ 18,457 $ 19,583 Comprehensive Income $ 23,523 $ 17,500 $ 17,553 condensed Statements of Cash Flows Year Ended December 31 2018 2017 2016 Cash flows from operating activities: Net income $ 24,920 $ 18,457 $ 19,583 Adjustments: Net gains on investment securities (14) Undistributed net income of subsidiaries (15,331) (9,237) (10,551) (Decrease) increase in other assets (111) (3) 577 Decrease in other liabilities (10) (53) (77) Stock based compensation 272 177 71 Net cash provided by operating activities 9,726 9,341 9,603 Cash flows from investing activities: Purchase of equity securities (234) (43) Cash flows used in financing activities: Redemption of common stock (604) Stock awards 5 5 Cash dividends paid (9,693) (9,319) (9,170) Net cash used in financing activities (9,688) (9,314) (9,774) Decrease in cash (196) (16) (171) Cash at beginning of year 3,932 3,948 4,119 Cash at end of year $ 3,736 $ 3,932 $ 3,948 |
Regulatory matters
Regulatory matters | 12 Months Ended |
Dec. 31, 2018 | |
Regulatory matters | |
Regulatory matters | 18. Regulatory matters: Dividends are paid by the Parent 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, or 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, 2018 and 2017 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 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, 2018, the maximum amount available for transfer from Peoples Bank to the Company in the form of loans amounted to $23,778. At December 31, 2018 and 2017, there were no loans outstanding, nor were any advances made during 2018 and 2017. 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. Risk-based capital rules require 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 was 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 met the capital requirement for the “well capitalized” category under the regulatory framework for prompt corrective action at December 31, 2018. 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. Regulators may assign Peoples Bank to a lower capitalization category based on factors other than capital. The Company and Peoples Bank’s actual capital ratios at December 31, 2018 and 2017, 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, 2018 Amount Ratio Amount Ratio Amount Ratio Common equity Tier 1 capital to risk-weighted assets: Consolidated $ 221,024 11.95 % $ 83,241 4.50 % Peoples Bank 215,027 11.64 83,144 4.50 $ 120,097 6.50 % Tier 1 capital to risk-weighted assets: Consolidated 221,024 11.95 110,988 6.00 Peoples Bank 215,027 11.64 110,859 6.00 147,811 8.00 Total capital to risk-weighted assets: Consolidated 242,403 13.10 147,984 8.00 Peoples Bank 236,406 12.80 147,811 8.00 184,764 10.00 Tier 1 capital to average assets: Consolidated 221,024 10.03 88,119 4.00 Peoples Bank 215,027 9.78 % 87,969 4.00 % 109,962 5.00 % Minimum to be Well Capitalized under Minimum For Capital Prompt Corrective Actual Adequacy Purposes Action Provisions December 31, 2017 Amount Ratio Amount Ratio Amount Ratio Common equity Tier 1 capital to risk-weighted assets: Consolidated $ 205,222 11.85 % $ 77,930 4.50 % Peoples Bank 199,450 11.53 77,843 4.50 $ 112,440 6.50 % Tier 1 capital to risk-weighted assets: Consolidated 205,222 11.85 103,906 6.00 Peoples Bank 199,450 11.53 103,791 6.00 138,388 8.00 Total capital to risk-weighted assets: Consolidated 224,182 12.95 138,542 8.00 Peoples Bank 218,410 12.63 138,388 8.00 172,985 10.00 Tier 1 capital to average assets: Consolidated 205,222 9.94 82,564 4.00 Peoples Bank 199,450 9.68 % 82,406 4.00 % 103,008 5.00 % |
Contingencies
Contingencies | 12 Months Ended |
Dec. 31, 2018 | |
Contingencies | |
Contingencies | 19. 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. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 12 Months Ended |
Dec. 31, 2018 | |
Accumulated Other Comprehensive Loss | |
Accumulated Other Comprehensive Loss | 20. Accumulated Other Comprehensive Loss: The components of accumulated other comprehensive loss included in stockholders’ equity at December 31, 2018 and 2017 are as follows: December 31, 2018 December 31, 2017 Net unrealized loss on investment securities available-for-sale $ (3,251) $ (1,237) Income tax (683) (260) Net of income taxes (2,568) (977) Benefit plan adjustments (7,218) (6,628) Income tax (1,516) (1,392) Net of income taxes (5,702) (5,236) Derivative adjustments 246 Income tax 52 Net of income taxes 194 Accumulated other comprehensive loss $ (8,076) $ (6,213) Other comprehensive loss and related tax effects for the years ended December 31, 2018, 2017 and 2016 are as follows: Year Ended December 31, 2018 2017 2016 Unrealized loss on investment securities available-for-sale $ (2,014) $ (1,790) $ (3,417) Net gain on the sale of investment securities available-for-sale (623) Benefit plans: Amortization of actuarial loss (2) 194 195 208 Actuarial gain (loss) (785) 123 709 Net change in benefit plan liabilities (591) 318 917 Net change in derivatives 246 Other comprehensive loss before taxes (2,359) (1,472) (3,123) Income tax (496) (515) (1,093) Other comprehensive loss $ (1,863) $ (957) $ (2,030) (1) Represents amounts reclassified out of accumulated comprehensive loss and included in gains on sale of investment securities on the consolidated statements of income and comprehensive income. (2) Represents amounts reclassified out of accumulated comprehensive loss and included in the computation of net periodic pension expense. Refer to Note 15 included in these consolidated financial statements. |
Summary of quarterly financial
Summary of quarterly financial information (unaudited) | 12 Months Ended |
Dec. 31, 2018 | |
Summary of quarterly financial information (unaudited) | |
Summary of quarterly financial information (unaudited) | 21. Summary of quarterly financial information (unaudited): 2018 Quarter Ended March 31 June 30 Sept. 30 Dec. 31 Interest income $ 19,994 $ 20,766 $ 21,419 $ 22,482 Interest expense 2,807 3,115 3,466 3,934 Net interest income 17,187 17,651 17,953 18,548 Provision for loan losses 1,050 1,050 1,050 1,050 Net interest income after provision for loan losses 16,137 16,601 16,903 17,498 Noninterest income 3,572 3,663 3,253 3,171 Noninterest expense 13,081 13,496 12,537 13,373 Income before income taxes 6,628 6,768 7,619 7,296 Income tax expense 774 811 902 904 Net income $ 5,854 $ 5,957 $ 6,717 $ 6,392 Per share data: Net income $ 0.79 $ 0.81 $ 0.91 $ 0.86 Cash dividends declared $ 0.32 $ 0.33 $ 0.33 $ 0.33 Average common shares outstanding 7,396,505 7,396,533 7,399,054 7,399,054 2017 Quarter Ended March 31 June 30 Sept. 30 Dec. 31 Interest income $ 17,799 $ 18,261 $ 18,831 $ 19,351 Interest expense 1,956 2,126 2,175 2,441 Net interest income 15,843 16,135 16,656 16,910 Provision for loan losses 1,200 1,200 1,200 1,200 Net interest income after provision for loan losses 14,643 14,935 15,456 15,710 Noninterest income 3,782 6,379 3,661 3,364 Noninterest expense 12,356 14,002 12,480 12,455 Income before income taxes 6,069 7,312 6,637 6,619 Income tax expense 1,269 1,653 1,287 3,971 Net income $ 4,800 $ 5,659 $ 5,350 $ 2,648 Per share data: Net income $ 0.65 $ 0.77 $ 0.72 $ 0.36 Cash dividends declared $ 0.31 $ 0.31 $ 0.32 $ 0.32 Average common shares outstanding 7,394,143 7,396,163 7,396,505 7,396,505 |
Summary of significant accoun_2
Summary of significant accounting policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
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”), collectively, the “Company” or “Peoples”. The Company services its retail and commercial customers through twenty-seven full-service community banking offices located within Bucks, Lackawanna, Lehigh, Luzerne, Monroe, Montgomery, Northampton, Susquehanna, Wayne and Wyoming Counties of Pennsylvania and Broome County of New York and one limited purpose banking office located in Schuylkill County, Pennsylvania. 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 deposits to commercial enterprises and individuals. Deposit product offerings include checking accounts, savings accounts, money market accounts and certificates of deposits. 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: The consolidated financial statements of the Company have been prepared in conformity with accounting principles generally accepted in the United States of America (“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, 2018, 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 with unrealized gains and losses reported in earnings. 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 on callable debt securities are amortized to the earliest call date from the maturity date. Premiums on non-callable securities are amortized and discounts are accreted using the interest method over the expected life of the security. 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, the Company requires 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, the Company considers and reviews a cash flow analysis of the borrower and guarantor, when applicable. In addition, the Company evaluates business cash flows, if applicable, net operating income of the property, the borrower’s expertise, credit history and the value of the underlying property. The Company has 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 and a formula portion for loss contingencies on those loans collectively evaluated. 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 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. 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 inherent in the loan portfolio as of December 31, 2018. |
Revenue from Contracts with Customers | Revenue from Contracts with Customers: The Company records revenue from contracts with customers in accordance with Accounting Standards Codification Topic 606, “Revenue from Contracts with Customers” (“Topic 606”). Under Topic 606, the Company must identify the contract with a customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract, and recognize revenue when (or as) the Company satisfies a performance obligation. Significant revenue has not been recognized in the current reporting period that results from performance obligations satisfied in previous periods. The Company’s primary sources of revenue are derived from interest and dividends earned on loans, investment securities, and other financial instruments that are not within the scope of Topic 606. The Company has evaluated the nature of its contracts with customers and determined that further disaggregation of revenue from contracts with customers into more granular categories beyond what is presented in the Consolidated Statements of Income was not necessary. The Company generally fully satisfies its performance obligations on its contracts with customers as services are rendered and the transaction prices are typically fixed; charged either on a periodic basis or based on activity. The following is a discussion of revenues within the scope of the new guidance: · Service charges, fees and commissions . Service charges, fees and commissions on deposit accounts include fees for banking services provided, overdrafts and non-sufficient funds. Revenue is generally recognized in accordance with published deposit account agreements for retail accounts or contractual agreements for commercial accounts. Our deposit services also include our ATM and debit card interchange revenue that is presented gross of the associated costs. Interchange revenue is generated by our deposit customers’ usage and volume of activity. Interchange rates are not controlled by the Company, which effectively acts as processor that collects and remits payments associated with customer debit card transactions. · Commission and fees on fiduciary activities. Commission and fees on fiduciary activities includes fees and commissions from investment management, administrative and advisory services primarily for individuals, and to a lesser extent, partnerships and corporations. Revenue is recognized on an accrual basis at the time the services are performed and when we have a right to invoice and are based on either the market value of the assets managed or the services provided. · Wealth management income. Wealth management income includes fees and commissions charged when we arrange for another party to transfer brokerage services to a customer. The fees and commissions under this agent relationship are based upon stated fee schedules based upon the type of transaction, volume, and value of the services provided. · Other noninterest income . Other noninterest income includes, among other things, merchant services income. Merchant services revenue is derived from a third party vendor that processes credit card transactions on behalf of our merchant customers. Merchant services revenue is primarily comprised of residual fee income based on the referred merchant’s processing volumes and/or margin. |
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 |
Goodwill and other intangible assets, net | 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. 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, 2018. |
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 on certain 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. The policies can be liquidated, if necessary, with associated tax costs. However, the Company intends to hold these policies and, accordingly, the Company has not provided for income taxes of the earnings from the increase in cash surrender value. |
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: 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. |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities The Company records all derivatives on the balance sheet at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether the Company has elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to changes in the fair value of an asset, liability, or firm commitment attributable to a particular risk, such as interest rate risk, are considered fair value hedges. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Derivatives may also be designated as hedges of the foreign currency exposure of a net investment in a foreign operation. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the recognition of the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk in a fair value hedge or the earnings effect of the hedged forecasted transactions in a cash flow hedge. The Company may enter into derivative contracts that are intended to economically hedge certain of its risk, even though hedge accounting does not apply or the Company elects not to apply hedge accounting. The Company has elected to measure the credit risk of its derivative financial instruments that are subject to master netting agreements on a net basis by counterparty portfolio. |
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. 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 measured at 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. |
Impaired loans | Impaired loans: Fair values for impaired loans are estimated using discounted cash flow analysis determined by the loan review function or underlying collateral values, where applicable. |
Interest rate swaps and floors | Interest rate swaps and floors: Values of these instruments are obtained through an independent pricing source utilizing information which may include market observed quotations for swaps, Libor rates, forward rates and rate volatility. Derivative contracts create exposure to interest rate movements as well as risks from the potential of non-performance of the counterparty. |
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, 2018, 2017 and 2016 was $720, $942 and $972, respectively. |
Income taxes | Income taxes: 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, 2018. On December 22, 2017, President Donald Trump signed into law H.R. 1, also known as the Tax Cuts and Jobs Act, which among other things reduced the federal corporate income tax rate to 21% effective January 1, 2018. As a result, and in accordance with GAAP, the Company remeasured its net deferred tax assets using the 21% rate. The revaluation of the Company’s net deferred tax assets at December 31, 2017 resulted in a reduction of these net assets and a corresponding increase in income tax expense of $2.6 million or $0.35 per share, which was recorded in the fourth quarter of 2017. 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 2015. |
Other comprehensive loss | Other comprehensive loss: The components of other comprehensive 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. 2018 2017 2016 For the Year Ended December 31 Basic Diluted Basic Diluted Basic Diluted Net Income $ 24,920 $ 24,920 $ 18,457 $ 18,457 $ 19,583 $ 19,583 Average common shares outstanding 7,397,797 7,397,797 7,395,837 7,395,837 7,396,716 7,396,716 Earnings per share $ 3.37 $ 3.37 $ 2.50 $ 2.50 $ 2.65 $ 2.65 |
Stock-based compensation | Stock-based compensation: The Company recognizes all share-based payments to employees in the consolidated statements of income and comprehensive income based on their fair values. The fair value of such equity instruments is recognized as an expense in the consolidated financial statements as services are performed. The Company has granted stock awards to employees at a 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. |
Recent accounting standards | Recent accounting standards: In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers” (“ASU 2014-09”), which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU replaces most existing revenue recognition guidance in GAAP. The new standard was effective for the Company on January 1, 2018. Adoption of ASU 2014-09 did not have a material impact on the Company’s consolidated financial statements and related disclosures as the Company’s primary sources of revenues are derived from interest and dividends earned on loans, investment securities, and other financial instruments that are not within the scope of ASU 2014-09. The Company’s revenue recognition pattern for revenue streams within the scope of ASU 2014-09, including but not limited to service charges on deposit accounts, commissions from fiduciary activities, wealth management, other noninterest income and gains/losses on the sale of other real estate owned, did not change significantly from current practice. The standard permits the use of either the full retrospective or modified retrospective transition method. The Company elected to use the modified retrospective transition method which requires application of ASU 2014-09 to uncompleted contracts at the date of adoption however, periods prior to the date of adoption will not be retrospectively revised as the impact of the ASU on uncompleted contracts at the date of adoption was not material. In January 2016, the FASB issued 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 was effective for the Company on January 1, 2018. Implementation of this guidance had no material impact on the consolidated financial statements of the Company in 2018. 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 are classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement for a lessee. From the lessor's perspective, the new standard requires a lessor to classify leases as either sales-type, finance or operating. A lease is 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 amendments in this ASU are effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2018. The Company elected to adopt this pronouncement using the optional transition method under ASU 2018-11 as of January 1, 2019 and estimates that the adoption will result in recognition of right-of-use assets and lease liabilities for operating leases of approximately $5,500 on its consolidated balance sheets, with no expected adjustment to stockholders’ equity and no material impact to its consolidated statements of income and comprehensive income. 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 GAAP in that current GAAP generally delays recognition of the full amount of credit losses until the loss is probable of occurring. · The amendments in the ASU retain many of the disclosure requirements related to credit quality in current GAAP, updated to reflect the change from an incurred loss methodology to an expected credit loss methodology. In addition, the ASU 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. Management created a formal committee to oversee the implementation of the amendments consisting of key stakeholders from credit, finance, risk and information technology. We have chosen a third-party software platform provider and are reviewing and testing the different credit loss estimation methodologies and collecting data to be able to comply with the standard. In addition to our allowance for loan losses, we will also record an allowance for credit losses on debt securities instead of applying the impairment model currently utilized. The amount of the adjustments will be impacted by each portfolio’s composition and credit quality at the adoption date as well as economic conditions and forecasts at that time. We are evaluating the impact of the ASU on our consolidated financial statements In March of 2017, the FASB issued ASU 2017-08, “Receivables – Nonrefundable Fees and Other Costs: Premium Amortization on Purchased Callable Debt Securities.” ASU 2017-08 addresses the amortization method for all callable bonds purchased at a premium to par. Under the revised guidance, entities will be required to amortize premiums on callable bonds to the earliest call date. ASU 2017-08 is effective in 2019 although early adoption is permitted. The Company elected to early adopt ASU 2017-08 in the first quarter of 2017. The adoption of this guidance did not have a material impact on the Company’s financial statements. In February 2018, the FASB issued ASU 2018-02, ”Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income”, which permits, but does not require, entities to reclassify tax effects stranded in accumulated other comprehensive income resulting from the Tax Cuts and Jobs Act of 2017 to retained earnings. Companies that elect to reclassify these amounts must reclassify stranded tax effects for all items accounted for in accumulated other comprehensive income. The Company elected early adoption and adopted this standard update in 2017. The Company’s stranded tax effects were related to valuation of the net deferred tax asset attributable to items of accumulated other comprehensive income (loss), which are unrealized gains (losses) on available-for-sale securities and unfunded defined benefit plan obligations. Adoption resulted in a reclassification between two categories of stockholders’ equity in 2017, with an increase of $1,101 in retained earnings and a decrease in accumulated other comprehensive loss for the same amount. In August 2018, the FASB issued ASU 2018-13 Fair Value Measurement (Topic 820): “Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement” modifies the disclosure requirements on fair value measurements in Topic 820, Fair Value Measurement, based on the FASB Concepts Statement, “Conceptual Framework for Financial Reporting – Chapter 8: Notes to Financial Statements”. In accordance with the Concepts Statement, this ASU removes, modifies and adds select disclosure requirements under Topic 820 after consideration of costs and benefits. ASU 2018-13 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019 for public entities, with early adoption permitted. The adoption of this guidance on January 1, 2020 is not expected to have a material effect on the Company’s consolidated financial statements. In August 2017, the Financial Accounting Standards Board issued ASU 2017-12, “Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities”. The purpose of this updated guidance is to better align a company’s financial reporting for hedging activities with the economic objectives of those activities. ASU 2017-12 is effective for public business entities for fiscal years beginning after December 15, 2018, with early adoption, including adoption in an interim period, permitted. ASU 2017-12 requires a modified retrospective transition method in which the Company will recognize the cumulative effect of the change on the opening balance of each affected component of equity in the statement of financial position as of the date of adoption. The Company has early adopted the standard in 2018 with no impact to its financial position upon transition. |
Summary of significant accoun_3
Summary of significant accounting policies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Summary of significant accounting policies | |
Schedule of estimated useful life of related assets | Premises and leasehold improvements 7 – 40 years Furniture, fixtures and equipment 3 – 10 years |
Schedule of earnings per share | 2018 2017 2016 For the Year Ended December 31 Basic Diluted Basic Diluted Basic Diluted Net Income $ 24,920 $ 24,920 $ 18,457 $ 18,457 $ 19,583 $ 19,583 Average common shares outstanding 7,397,797 7,397,797 7,395,837 7,395,837 7,396,716 7,396,716 Earnings per share $ 3.37 $ 3.37 $ 2.50 $ 2.50 $ 2.65 $ 2.65 |
Investment securities (Tables)
Investment securities (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Schedule of amortized cost and fair value of investment securities aggregated by investment category | Gross Gross Amortized Unrealized Unrealized Fair December 31, 2018 Cost Gains Losses Value Available-for-sale: U.S. Treasury securities $ 25,948 $ 9 $ 365 $ 25,592 U.S. Government-sponsored enterprises 94,999 2 2,183 92,818 State and municipals: Taxable 13,544 309 13,853 Tax-exempt 86,361 338 745 85,954 Residential Mortgage-backed securities: U.S. Government agencies 12,663 50 84 12,629 U.S. Government-sponsored enterprises 33,149 49 401 32,797 Commercial Mortgage-backed securities: U.S. Government-sponsored enterprises 6,269 230 6,039 Total $ 272,933 $ 757 $ 4,008 $ 269,682 Held-to-maturity: Tax-exempt state and municipals $ 6,855 $ 12 $ 43 $ 6,824 Residential Mortgage-backed securities: U.S. Government agencies 42 42 U.S. Government-sponsored enterprises 1,464 55 5 1,514 Total $ 8,361 $ 67 $ 48 $ 8,380 Gross Gross Amortized Unrealized Unrealized Fair December 31, 2017 Cost Gains Losses Value Available-for-sale: U.S. Treasury securities $ 20,042 $ 228 $ 19,814 U.S. Government-sponsored enterprises 95,358 $ 30 1,740 93,648 State and municipals: Taxable 14,559 488 15,047 Tax-exempt 103,199 1,136 502 103,833 Residential Mortgage-backed securities: U.S. Government agencies 14,517 2 85 14,434 U.S. Government-sponsored enterprises 19,752 10 231 19,531 Commercial Mortgage-backed securities: U.S. Government-sponsored enterprises 6,315 120 6,195 Total $ 273,742 $ 1,666 $ 2,906 $ 272,502 Held-to-maturity: Tax-exempt state and municipals $ 6,859 $ 152 $ 13 $ 6,998 Residential Mortgage-backed securities: U.S. Government agencies 54 54 U.S. Government-sponsored enterprises 2,361 138 4 2,495 Total $ 9,274 $ 290 $ 17 $ 9,547 |
Schedule of 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, 2018 Value Losses Value Losses Value Losses U.S. Treasury securities $ 1,995 $ 2 $ 19,671 $ 363 $ 21,666 $ 365 U.S. Government-sponsored enterprises 2,037 1 89,729 2,182 91,766 2,183 State and municipals: Tax-exempt 9,022 74 52,352 714 61,374 788 Residential Mortgage-backed securities: U.S. Government agencies 7,800 84 7,800 84 U.S. Government-sponsored enterprises 12,851 55 13,881 351 26,732 406 Commercial Mortgage-backed securities: U.S. Government-sponsored enterprises 6,039 230 6,039 230 Total $ 25,905 $ 132 $ 189,472 $ 3,924 $ 215,377 $ 4,056 Less Than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized December 31, 2017 Value Losses Value Losses Value Losses U.S. Treasury securities $ 17,350 $ 170 $ 2,464 $ 58 $ 19,814 $ 228 U.S. Government-sponsored enterprises 39,096 445 51,365 1,295 90,461 1,740 State and municipals: Tax-exempt 54,788 454 3,808 61 58,596 515 Residential Mortgage-backed securities: U.S. Government agencies 9,484 39 3,968 46 13,452 85 U.S. Government-sponsored enterprises 12,537 103 6,504 132 19,041 235 Commercial Mortgage-backed securities: U.S. Government-sponsored enterprises 6,195 120 6,195 120 Total $ 139,450 $ 1,331 $ 68,109 $ 1,592 $ 207,559 $ 2,923 |
Summary of unrealized and realized gains and losses | Year Ended December 31, 2018 Net gains recognized during the period on equity securities $ 14 Less: Net gains and (losses) recognized during the period on equity securities sold during the period Unrealized gains recognized during the reporting period on equity securities still held at the reporting date $ 14 |
Available-for-Sale Securities. | |
Schedule of maturity distribution of fair value | December 31, 2018 Within one year $ 38,925 After one but within five years 152,806 After five but within ten years 15,900 After ten years 10,586 218,217 Mortgage-backed securities 51,465 Total $ 269,682 |
Held-to-maturity Securities. | |
Schedule of maturity distribution of fair value | Amortized Fair December 31, 2018 Cost Value Within one year After one but within five years After five but within ten years After ten years $ 6,855 $ 6,824 6,855 6,824 Mortgage-backed securities 1,506 1,556 Total $ 8,361 $ 8,380 |
Loans, net and allowance for _2
Loans, net and allowance for loan losses (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Loans, net and allowance for loan losses | |
Schedule of major classifications of loans outstanding | December 31, 2018 December 31, 2017 Commercial $ 494,134 $ 476,199 Real estate: Commercial 907,803 786,210 Residential 299,876 287,935 Consumer 121,453 142,721 Total $ 1,823,266 $ 1,693,065 |
Schedule of changes in allowance for loan losses account by major classification of loans | Real estate December 31, 2018 Commercial Commercial Residential Consumer Unallocated Total Allowance for loan losses: Beginning balance $ 5,513 $ 8,944 $ 3,111 $ 1,392 $ $ 18,960 Charge-offs (154) (1,250) (405) (545) (2,354) Recoveries 137 136 98 202 573 Provisions 20 2,906 1,088 186 4,200 Ending balance $ 5,516 $ 10,736 $ 3,892 $ 1,235 $ $ 21,379 Ending balance: individually evaluated for impairment 50 403 666 60 1,179 Ending balance: collectively evaluated for impairment $ 5,466 $ 10,333 $ 3,226 $ 1,175 $ 20,200 Loans receivable: Ending balance $ 494,134 $ 907,803 $ 299,876 $ 121,453 $ $ 1,823,266 Ending balance: individually evaluated for impairment 2,237 3,121 4,071 212 9,641 Ending balance: collectively evaluated for impairment $ 491,897 $ 904,682 $ 295,805 $ 121,241 $ $ 1,813,625 Real estate December 31, 2017 Commercial Commercial Residential Consumer Unallocated Total Allowance for loan losses: Beginning balance $ 4,452 $ 7,548 $ 2,961 $ 1,000 $ $ 15,961 Charge-offs (173) (706) (533) (737) (2,149) Recoveries 20 124 44 160 348 Provisions 1,214 1,978 639 969 4,800 Ending balance $ 5,513 $ 8,944 $ 3,111 $ 1,392 $ $ 18,960 Ending balance: individually evaluated for impairment 159 263 336 8 766 Ending balance: collectively evaluated for impairment $ 5,354 $ 8,681 $ 2,775 $ 1,384 $ 18,194 Loans receivable: Ending balance $ 476,199 $ 786,210 $ 287,935 $ 142,721 $ $ 1,693,065 Ending balance: individually evaluated for impairment 2,463 4,289 3,793 177 10,722 Ending balance: collectively evaluated for impairment $ 473,736 $ 781,921 $ 284,142 $ 142,544 $ $ 1,682,343 Real estate December 31, 2016 Commercial Commercial Residential Consumer Unallocated Total Allowance for loan losses: Beginning balance $ 4,113 $ 4,751 $ 3,174 $ 937 $ $ 12,975 Charge-offs (776) (858) (339) (495) (2,468) Recoveries 86 122 69 177 454 Provisions 1,029 3,533 57 381 5,000 Ending balance $ 4,452 $ 7,548 $ 2,961 $ 1,000 $ $ 15,961 Ending balance: individually evaluated for impairment 225 1,197 520 1,942 Ending balance: collectively evaluated for impairment $ 4,227 $ 6,351 $ 2,441 $ 1,000 $ $ 14,019 Loans receivable: Ending balance $ 408,814 $ 700,144 $ 289,781 $ 134,226 $ $ 1,532,965 Ending balance: individually evaluated for impairment 2,687 7,157 3,580 155 13,579 Ending balance: collectively evaluated for impairment $ 406,127 $ 692,987 $ 286,201 $ 134,071 $ $ 1,519,386 |
Schedule of major classification of loans portfolio summarized by credit quality | Special December 31, 2018 Pass Mention Substandard Doubtful Total Commercial $ 491,531 $ 869 $ 1,734 $ $ 494,134 Real estate: Commercial 886,849 8,934 12,020 907,803 Residential 295,758 357 3,761 299,876 Consumer 121,229 224 121,453 Total $ 1,795,367 $ 10,160 $ 17,739 $ $ 1,823,266 Special December 31, 2017 Pass Mention Substandard Doubtful Total Commercial $ 472,185 $ 1,958 $ 2,056 $ $ 476,199 Real estate: Commercial 764,320 13,015 8,875 786,210 Residential 282,484 18 5,433 287,935 Consumer 142,507 214 142,721 Total $ 1,661,496 $ 14,991 $ 16,578 $ $ 1,693,065 |
Schedule of information concerning nonaccrual loans by major loan classification | 2018 2017 Commercial $ 776 $ 860 Real estate: Commercial 2,663 3,821 Residential 2,580 2,994 Consumer 212 177 Total $ 6,231 $ 7,852 |
Schedule of 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, 2018 Past Due Past Due Days Due Current Total Loans Accruing Commercial $ 973 $ 79 $ 776 $ 1,828 $ 492,306 $ 494,134 Real estate: Commercial 1,889 218 2,736 4,843 902,960 907,803 $ 73 Residential 2,486 1,545 3,430 7,461 292,415 299,876 850 Consumer 756 292 212 1,260 120,193 121,453 Total $ 6,104 $ 2,134 $ 7,154 $ 15,392 $ 1,807,874 $ 1,823,266 $ 923 Greater Loans > 90 30-59 Days 60-89 Days than 90 Total Past Days and December 31, 2017 Past Due Past Due Days Due Current Total Loans Accruing Commercial $ 124 $ 216 $ 860 $ 1,200 $ 474,999 $ 476,199 Real estate: Commercial 1,722 194 3,821 5,737 780,473 786,210 Residential 1,134 1,551 3,543 6,228 281,707 287,935 $ 549 Consumer 1,101 364 363 1,828 140,893 142,721 186 Total $ 4,081 $ 2,325 $ 8,587 $ 14,993 $ 1,678,072 $ 1,693,065 $ 735 |
Summarized information concerning impaired loans | For the Year Ended Unpaid Average Interest Recorded Principal Related Recorded Income December 31, 2018 Investment Balance Allowance Investment Recognized With no related allowance: Commercial $ 1,562 $ 1,900 $ 1,318 $ 67 Real estate: Commercial 1,969 2,299 2,822 28 Residential 1,970 2,658 2,193 22 Consumer 152 160 135 Total 5,653 7,017 6,468 117 With an allowance recorded: Commercial 675 675 50 1,006 30 Real estate: Commercial 1,152 1,323 403 1,676 18 Residential 2,101 2,328 666 1,585 22 Consumer 60 60 60 21 Total 3,988 4,386 1,179 4,288 70 Total impaired loans Commercial 2,237 2,575 50 2,324 97 Real estate: Commercial 3,121 3,622 403 4,498 46 Residential 4,071 4,986 666 3,778 44 Consumer 212 220 60 156 Total $ 9,641 $ 11,403 $ 1,179 $ 10,756 $ 187 For the Year Ended Unpaid Average Interest Recorded Principal Related Recorded Income December 31, 2017 Investment Balance Allowance Investment Recognized With no related allowance: Commercial $ 1,279 $ 1,439 $ 1,668 $ 43 Real estate: Commercial 2,888 3,190 2,985 24 Residential 2,196 2,672 2,227 21 Consumer 169 181 173 Total 6,532 7,482 7,053 88 With an allowance recorded: Commercial 1,184 1,218 159 991 50 Real estate: Commercial 1,401 1,496 263 2,202 18 Residential 1,597 1,759 336 1,335 23 Consumer 8 8 8 20 Total 4,190 4,481 766 4,548 91 Total impaired loans Commercial 2,463 2,657 159 2,659 93 Real estate: Commercial 4,289 4,686 263 5,187 42 Residential 3,793 4,431 336 3,562 44 Consumer 177 189 8 193 Total $ 10,722 $ 11,963 $ 766 $ 11,601 $ 179 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 $ 2,404 $ 3,213 $ 1,461 $ Real estate: Commercial 2,364 3,018 4,300 Residential 2,205 2,388 2,133 Consumer 155 155 147 Total 7,128 8,774 8,041 154 With an allowance recorded: Commercial 283 283 $ 225 859 Real estate: Commercial 4,793 4,793 1,197 2,366 2 Residential 1,375 1,376 520 1,185 7 Consumer 50 Total 6,451 6,452 1,942 4,460 9 Total impaired loans Commercial 2,687 3,496 225 2,320 48 Real estate: Commercial 7,157 7,811 1,197 6,666 73 Residential 3,580 3,764 520 3,318 42 Consumer 155 155 197 Total $ 13,579 $ 15,226 $ 1,942 $ 12,501 $ 163 |
Summary loans whose terms have been modified resulting in troubled debt restructurings | Pre-Modification Post-Modification Number Outstanding Recorded Outstanding Recorded December 31, 2018 of Contracts Investment Recorded Investment Investment Commercial real estate 1 $ 340 $ 340 $ 340 Total 1 $ 340 $ 340 $ 340 Pre-Modification Post-Modification Number Outstanding Recorded Outstanding Recorded December 31, 2017 of Contracts Investment Recorded Investment Investment Commercial 2 $ 885 $ 885 $ 864 Commercial real estate 3 721 721 700 Residential mortgage 1 64 64 64 Total 6 $ 1,670 $ 1,670 $ 1,628 Pre-Modification Post-Modification Number Outstanding Recorded Outstanding Recorded December 31, 2016 of Contracts Investment Recorded Investment Investment Commercial 1 $ 1,500 $ 1,150 $ 1,150 Commercial real estate Residential mortgage 2 216 216 207 Total 3 $ 1,716 $ 1,366 $ 1,357 |
Off-balance sheet financial i_2
Off-balance sheet financial instruments (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Off-balance sheet financial instruments. | |
Summary of contractual amounts of off-balance sheet commitments | December 31 2018 2017 Commitments to extend credit $ 294,122 $ 324,984 Unused portions of lines of credit 51,790 56,244 Standby letters of credit 33,275 23,387 $ 379,187 $ 404,615 |
Premises and equipment, net (Ta
Premises and equipment, net (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Premises and equipment, net | |
Summary of premises and equipment | December 31 2018 2017 Land $ 5,535 $ 5,875 Premises and leasehold improvements 44,813 42,472 Furniture, fixtures and equipment 14,812 13,249 65,160 61,596 Less: accumulated depreciation 26,271 24,039 $ 38,889 $ 37,557 |
Summary of future minimum annual rent commitments under various operating leases | 2019 $ 532 2020 527 2021 514 2022 516 2023 432 Thereafter 5,024 $ 7,545 |
Intangible assets, net (Tables)
Intangible assets, net (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Intangible assets, net | |
Summary of estimated amortization expense on intangible assets | 2019 $ 730 2020 606 2021 491 2022 363 2023 106 Total $ 2,296 |
Other assets (Tables)
Other assets (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Other assets. | |
Schedule of components of other assets | December 31, 2018 December 31, 2017 Other real estate owned $ 376 $ 284 Investment in low income housing partnership 7,377 7,842 Mortgage servicing rights 718 728 Bank owned life insurance 34,288 33,836 Restricted equity securities 7,462 8,562 Net deferred tax asset 5,081 3,906 Other assets 8,435 9,311 Total $ 63,737 $ 64,469 |
Deposits (Tables)
Deposits (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Deposits. | |
Summary of major components of interest-bearing and noninterest-bearing deposits | December 31 2018 2017 Interest-bearing deposits: Money market accounts $ 328,949 $ 278,494 Now accounts 421,414 389,734 Savings accounts 378,157 387,827 Time deposits less than $250 250,456 220,812 Time deposits $250 or more 85,786 61,422 Total interest-bearing deposits 1,464,762 1,338,289 Noninterest-bearing deposits 410,260 380,729 Total deposits $ 1,875,022 $ 1,719,018 |
Schedule of aggregate amounts of maturities for all time deposits | 2019 $ 154,506 2020 52,824 2021 83,959 2022 12,895 2023 19,438 Thereafter 12,620 $ 336,242 |
Short-term borrowings (Tables)
Short-term borrowings (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Short-term borrowings | |
Summary of short-term borrowings | At and for the year ended December 31, 2018 Weighted Weighted Maximum Average Average Ending Average Month-End Rate for Rate at End Balance Balance Balance the Year of the Year FHLB advances $ 86,500 $ 133,834 $ 189,275 2.05 % 2.62 % At and for the year ended December 31, 2017 Weighted Weighted Maximum Average Average Ending Average Month-End Rate for Rate at End Balance Balance Balance the Year of the Year FHLB advances $ 123,675 $ 76,846 $ 123,675 1.17 % 1.54 % 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 FHLB advances $ 82,700 $ 67,553 $ 86,300 0.60 % 0.74 % |
Long-term debt (Tables)
Long-term debt (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Long-term debt. | |
Schedule of long-term debt consisting of advances | Interest Rate Due Fixed Adjustable 2018 2017 April 2018 3.83 % $ 40 December 2018 1.27 10,000 December 2019 4.28 % 3,000 3,000 December 2019 4.01 6,300 6,300 December 2019 1.62 10,000 10,000 June 2020 1.74 5,000 5,000 December 2020 1.84 5,000 5,000 March 2023 4.69 8,606 10,394 $ 37,906 $ 49,734 |
Schedule of maturities of long-term debt | 2019 $ 21,174 2020 11,963 2021 2,058 2022 2,156 2023 555 $ 37,906 |
Fair value of financial instr_2
Fair value of financial instruments (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
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, 2018 Amount (Level 1) (Level 2) (Level 3) U.S. Treasury securities $ 25,592 $ 25,592 $ U.S. Government-sponsored enterprises 92,818 $ 92,818 State and Municipals: Taxable 13,853 13,853 Tax-exempt 85,954 85,954 Mortgage-backed securities: U.S. Government agencies 12,629 12,629 U.S. Government-sponsored enterprises 38,836 38,836 Common equity securities 291 291 Interest rate floor - other assets 553 553 Interest rate swap-other assets 108 108 Interest rate swap-other liabilities (138) (138) Total $ 270,496 $ 25,883 $ 244,613 $ Fair Value Measurement Using Quoted Prices in Significant Significant Active Markets for Other Observable Unobservable Identical Assets Inputs Inputs December 31, 2017 Amount (Level 1) (Level 2) (Level 3) U.S. Treasury securities $ 19,814 $ 19,814 $ U.S. Government-sponsored enterprises 93,648 $ 93,648 State and Municipals: Taxable 15,047 15,047 Tax-exempt 103,833 103,833 Mortgage-backed securities: U.S. Government agencies 14,434 14,434 U.S. Government-sponsored enterprises 25,726 25,726 Common equity securities 46 46 Interest rate swap-other assets 655 655 Interest rate swap-other liabilities (733) (733) Total $ 272,470 $ 19,860 $ 252,610 $ |
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, 2018 Amount (Level 1) (Level 2) (Level 3) Impaired loans $ 2,809 $ 2,809 Other real estate owned $ 234 $ 234 Fair Value Measurement Using Quoted Prices in Significant Other Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs December 31, 2017 Amount (Level 1) (Level 2) (Level 3) Impaired loans $ 3,424 $ 3,424 Other real estate owned $ 216 $ 216 |
Schedule of 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, 2018 Estimate Valuation Techniques Unobservable Input (Weighted Average) Impaired loans $ 2,809 Appraisal of collateral Appraisal adjustments 7.1% to 97.0% (61.8)% Liquidation expenses 3.0% to 6.0% (4.4)% Other real estate owned $ 234 Appraisal of collateral Appraisal adjustments 26.0% to 73.3% (38.9)% Liquidation expenses 3.0% to 6.0% (5.0)% Quantitative Information about Level 3 Fair Value Measurements Fair Value Range December 31, 2017 Estimate Valuation Techniques Unobservable Input (Weighted Average) Impaired loans $ 3,424 Appraisal of collateral Appraisal adjustments 4.0% to 97.0% (67.2)% Liquidation expenses 3.0% to 6.0% (4.9)% Other real estate owned $ 216 Appraisal of collateral Appraisal adjustments 25.0% to 41.3% (30.7)% Liquidation expenses 3.0% to 6.0% (5.0)% |
Schedule of 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, 2018 Value Value (level 1) (level 2) (Level 3) Financial assets: Cash and cash equivalents $ 32,616 $ 32,616 $ 32,616 Investment securities: Available-for-sale 269,682 269,682 25,592 $ 244,090 Common equity securities 291 291 291 Held-to-maturity 8,361 8,380 8,380 Loans held for sale 749 749 749 Net loans 1,801,887 1,762,449 $ 1,762,449 Accrued interest receivable 7,115 7,115 7,115 Mortgage servicing rights 718 1,710 1,710 Restricted equity securities 7,462 7,462 7,462 Interest rate floor 553 553 553 Interest rate swaps 108 108 108 Total $ 2,129,542 $ 2,091,115 Financial liabilities: Deposits $ 1,875,022 $ 1,874,520 $ 1,874,520 Short-term borrowings 86,500 86,500 86,500 Long-term debt 37,906 38,071 38,071 Accrued interest payable 1,195 1,195 1,195 Interest rate swaps 138 138 138 Total $ 2,000,761 $ 2,000,424 Fair Value Hierarchy Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable Carrying Fair Assets Inputs Inputs December 31, 2017 Value Value (level 1) (level 2) (Level 3) Financial assets: Cash and cash equivalents $ 37,488 $ 37,488 $ 37,488 Investment securities: Available-for-sale 272,548 272,548 19,860 $ 252,688 Held-to-maturity 9,274 9,547 9,547 Loans held for sale 106 106 106 Net loans 1,674,105 1,645,292 $ 1,645,292 Accrued interest receivable 6,936 6,936 6,936 Mortgage servicing rights 728 1,638 1,638 Restricted equity securities 8,562 8,562 8,562 Interest rate swaps 655 655 655 Total $ 2,010,402 $ 1,982,772 Financial liabilities: Deposits $ 1,719,018 $ 1,666,284 $ 1,666,284 Short-term borrowings 123,675 123,675 123,675 Long-term debt 49,734 50,147 50,147 Accrued interest payable 497 497 497 Interest rate swaps 733 733 733 Total $ 1,893,657 $ 1,841,336 |
Derivatives and hedging activ_2
Derivatives and hedging activities (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Derivatives and hedging activities | |
Schedule of fair value of derivative financial instruments and balance sheet classification | Asset Derivatives Asset Derivatives Liability Derivatives Liability Derivatives As of December 31, 2018 As of December 31, 2017 (1) As of December 31, 2018 As of December 31, 2017 (2) Notional Balance Sheet Balance Sheet Balance Sheet Balance Sheet Amount Location Fair Value Location Fair Value Location Fair Value Location Fair Value Derivatives designated as hedging instruments Interest Rate Floor 25,000 Other Assets $ Total derivatives designated as hedging instruments $ Derivatives not designated as hedging instruments Interest Rate Swaps 62,071 Other Assets $ 108 Other Assets $ 655 Other Liabilities $ 138 Other Liabilities $ 733 Total derivatives not designated as hedging instruments $ 108 $ 655 $ 138 $ 733 (1) Assets amount does not include accrued interest receivable of $28 Liabilities amount does not include accrued interest payable of $28 |
Schedule of effect of fair value and cash flow hedge accounting on Accumulated Other Comprehensive Income | Location of Amount of Amount of Amount of Amount of Amount of Gain or (Loss) Amount of Gain Loss Loss Gain Gain Recognized from Loss Reclassified Reclassified Recognized in Recognized in Recognized in Accumulated Reclassified from Accumulated from Accumulated Derivatives in OCI on OCI Included OCI Excluded Other Comprehensive from Accumulated OCI into Income OCI into Income Hedging Derivative Component Component Income into OCI into Income Included Component Excluded Component Relationships 2018 Income 2018 Derivatives in Cash Flow Hedging Relationships Interest Rate Floor (*) 243 109 134 Interest Income (3) 13 (16) Total 243 109 134 (3) 13 (16) * Amounts disclosed are gross and not net of taxes. |
Schedule of effect of derivative financial instruments on Income Statement | Location and Amount of Gain or (Loss) Recognized in Income on Fair Value and Cash Flow Hedging Relationships 2018 2017 Interest Income Interest Income Total amounts of income and expense line items presented in the statement of financial performance in which the effects of fair value or cash flow hedges are recorded (3) The effects of fair value and cash flow hedging: Gain or (loss) on cash flow hedging relationships Interest contracts Amount of gain or (loss) reclassified from accumulated other comprehensive income into income (3) Amount of gain or (loss) reclassified from accumulated other comprehensive income into income - included component 13 Amount of gain or (loss) reclassified from accumulated other comprehensive income into income - excluded component (16) |
Schedule of gain (loss) on derivative instruments not designated as hedging instruments | Amount of Gain Amount of Loss Recognized in Recognized in Location of Gain or (Loss) Income Income Recognized in Income on Twelve Months Ended Twelve Months Ended Derivatives Not Designated as Hedging Instruments Derivative December 31, 2018 December 31, 2017 Interest Rate Swaps Other non-interest income $ 49 $ (79) Fee Income Other income / (expense) $ 53 $ 792 |
Schedule of offsetting derivatives | Offsetting of Derivative Assets as of December 31, 2018 Gross Amounts Net Amounts Gross Amounts Not Offset in the Statement of Financial Position Gross Offset in the of Assets Amounts of Statement of presented in the Recognized Financial Statement of Financial Cash Collateral Net Assets Position Financial Position Instruments Received Amount Derivatives $ 661 $ $ 661 $ $ 661 Offsetting of Derivative Liabilities as of December 31, 2018 Gross Amounts Net Amounts Gross Amounts Not Offset in the Statement of Financial Position Gross Offset in the of Assets Amounts of Statement of presented in the Recognized Financial Statement of Financial Cash Collateral Net Assets Position Financial Position Instruments Received Amount Derivatives $ 138 $ $ 138 $ $ 138 Offsetting of Derivative Assets as of December 31, 2017 Gross Amounts Net Amounts Gross Amounts Not Offset in the Statement of Financial Position Gross Offset in the of Assets Amounts of Statement of presented in the Recognized Financial Statement of Financial Cash Collateral Net Assets Position Financial Position Instruments Received Amount Derivatives $ 655 $ $ 655 $ $ 655 Offsetting of Derivative Liabilities as of December 31, 2017 Gross Amounts Net Amounts Gross Amounts Not Offset in the Statement of Financial Position Gross Offset in the of Assets Amounts of Statement of presented in the Recognized Financial Statement of Financial Cash Collateral Net Assets Position Financial Position Instruments Received Amount Derivatives $ 733 $ $ 733 $ $ 733 |
Stock plans (Tables)
Stock plans (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Stock plans | |
Schedule of activity related to restricted stock | Year Ended December 31 2018 2017 2016 Nonvested, January 1 12,448 12,362 14,309 Granted shares 11,468 10,628 Vested shares 2,607 10,542 1,947 Forfeited shares Nonvested, December 31 21,309 12,448 12,362 |
Employee benefit plans (Tables)
Employee benefit plans (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Employee benefit plans | |
Summary of pension and postretirement life insurance plans | Pension Benefits December 31 2018 2017 Change in benefit obligation: Benefit obligation, beginning $ 16,935 $ 16,703 Interest cost 623 650 Change in experience gain 135 (13) Change in actuarial assumptions loss (gain) (546) 395 Benefits paid (809) (800) Benefit obligation, ending 16,338 16,935 Change in plan assets: Fair value of plan assets, beginning 13,264 12,644 Actual return on plan assets (236) 1,420 Employer contributions 2,700 Benefits paid (809) (800) Fair value of plan assets, ending 14,919 13,264 Funded status at end of year $ (1,419) $ (3,671) |
Schedule of amounts recognized in balance sheet | Pension Benefits December 31 2018 2017 Liabilities $ 1,419 $ 3,671 Amounts recognized in the accumulated other comprehensive loss consist of: Net actuarial gain (7,218) (6,628) Deferred taxes 1,516 1,392 Net amount recognized $ (5,702) $ (5,236) |
Schedule of components of net periodic benefit cost | Pension Benefits Years Ended December 31, 2018 2017 2016 Net periodic pension income: Interest cost $ 623 $ 650 $ 665 Expected return on plan assets (960) (915) (893) Amortization of unrecognized net loss 194 195 209 Net periodic pension income: (143) (70) (19) Other changes in plan assets and benefit obligations recognized in other comprehensive income (loss): Net loss (gain) (590) 318 917 Deferred tax 124 (67) (321) Total recognized in other comprehensive loss (466) 251 596 Total recognized in net period pension cost and other comprehensive loss $ (609) $ 181 $ 577 |
Schedule of weighted-average assumptions used to determine benefit obligations and related expenses | Pension Benefits December 31, Discount rate: Obligation 3.75 % 4.00 % 4.00 % Expense 4.00 3.75 4.00 Expected long-term return on plan assets 7.50 % 7.50 % 7.50 % |
Schedule of pension plan weighted-average asset allocations | December 31, 2018 2017 Asset Category: Cash and cash equivalents 5.0 % 4.1 % Equity securities 56.2 57.4 Corporate bonds 23.6 27.6 U.S. Government securities 15.2 10.9 % % |
Schedule of fair value measurement of pension plan assets | Quoted Prices in Active Markets Significant Significant for Identical Observable Observable Assets Inputs Inputs December 31, 2018 Total (Level 1) (Level 2) (Level 3) Cash $ 743 $ 743 $ Equity securities: U.S. large cap 7,687 7,687 International 694 694 Fixed income securities: U.S. Treasuries 192 $ 192 U.S. Government agencies 2,085 2,085 Corporate bonds 3,518 3,518 Total $ 14,919 $ 9,124 $ 5,795 $ Quoted Prices in Active Markets Significant Significant for Identical Observable Observable Assets Inputs Inputs December 31, 2017 Total (Level 1) (Level 2) (Level 3) Cash $ 539 $ 539 $ Equity securities: U.S. large cap 7,269 7,269 International 350 350 Fixed income securities: U.S. Treasuries 198 $ 198 U.S. Government agencies 1,247 1,247 Corporate bonds 3,661 3,661 Total $ 13,264 $ 8,158 $ 5,106 $ |
Schedule of expected benefit payments | Pension Benefits 2019 $ 843 2020 857 2021 858 2022 896 2023 912 Thereafter 5,028 |
Income taxes (Tables)
Income taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income taxes | |
Schedule of current and deferred amounts of the provision for income taxes expense (benefit0 | Year Ended December 31 2018 2017 2016 Current $ 4,072 $ 6,515 $ 6,450 Deferred (681) 1,665 (1,442) Total $ 3,391 $ 8,180 $ 5,008 |
Schedule of the components of the net deferred tax asset | December 31 2018 2017 Deferred tax assets: Allowance for loan losses $ 4,490 $ 3,981 Defined benefit plan 1,516 1,392 Deferred compensation 593 499 Deferred loan fees 470 264 Investment securities available-for-sale 683 260 Other 116 106 Total 7,868 6,502 Deferred tax liabilities: Premises and equipment, net 985 815 Merger related accounting 1,083 1,243 Deferred loan costs 626 531 Investment securities available-for-sale Other 93 7 Total 2,787 2,596 Net deferred tax asset $ 5,081 $ 3,906 |
Schedule of the 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 | Year Ended December 31 2018 2017 2016 Federal income tax at statutory rate $ 5,945 $ 9,323 $ 8,607 Effect of federal income tax rate changes (Note 1) 2,623 Tax exempt interest (1,320) (2,157) (2,264) Life insurance investment income (236) (269) (277) Residential housing program tax credits (1,094) (1,095) (1,128) Other, net 96 (245) 70 Total $ 3,391 $ 8,180 $ 5,008 |
Parent Company financial stat_2
Parent Company financial statements (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Parent Company financial statements | |
Condensed Balance Sheets | December 31 2018 2017 Assets: Cash and cash equivalents $ 3,736 $ 3,932 Equity securities 291 46 Investment in bank subsidiary 272,617 259,147 Due from subsidiaries 1,974 1,900 Other assets 35 Total assets $ 278,653 $ 265,025 Liabilities and Stockholders’ Equity: Other liabilities $ 39 $ 49 Stockholders’ equity 278,614 264,976 Total liabilities and stockholders’ equity $ 278,653 $ 265,025 |
Condensed Statements of Income and Comprehensive Income | Year Ended December 31 2018 2017 2016 Income: Dividends from subsidiaries $ 9,691 $ 9,319 $ 9,170 Other income 72 52 46 Unrealized holding gains on equity securities 13 Total income 9,776 9,371 9,216 Expense: Other expenses 214 205 259 Total expenses 214 205 259 Income before taxes and undistributed income 9,562 9,166 8,957 Income tax benefit (27) (54) (75) Income before undistributed income of subsidiaries 9,589 9,220 9,032 Equity in undistributed net income of subsidiaries 15,331 9,237 10,551 Net income $ 24,920 $ 18,457 $ 19,583 Comprehensive Income $ 23,523 $ 17,500 $ 17,553 |
Condensed Statements of Cash Flows | Year Ended December 31 2018 2017 2016 Cash flows from operating activities: Net income $ 24,920 $ 18,457 $ 19,583 Adjustments: Net gains on investment securities (14) Undistributed net income of subsidiaries (15,331) (9,237) (10,551) (Decrease) increase in other assets (111) (3) 577 Decrease in other liabilities (10) (53) (77) Stock based compensation 272 177 71 Net cash provided by operating activities 9,726 9,341 9,603 Cash flows from investing activities: Purchase of equity securities (234) (43) Cash flows used in financing activities: Redemption of common stock (604) Stock awards 5 5 Cash dividends paid (9,693) (9,319) (9,170) Net cash used in financing activities (9,688) (9,314) (9,774) Decrease in cash (196) (16) (171) Cash at beginning of year 3,932 3,948 4,119 Cash at end of year $ 3,736 $ 3,932 $ 3,948 |
Regulatory matters (Tables)
Regulatory matters (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Regulatory matters | |
Schedule of actual capital ratios and the minimum ratios required for capital adequacy purposes and to be well capitalized under the prompt corrective action provisions | Minimum to be Well Capitalized under Minimum For Capital Prompt Corrective Actual Adequacy Purposes Action Provisions December 31, 2018 Amount Ratio Amount Ratio Amount Ratio Common equity Tier 1 capital to risk-weighted assets: Consolidated $ 221,024 11.95 % $ 83,241 4.50 % Peoples Bank 215,027 11.64 83,144 4.50 $ 120,097 6.50 % Tier 1 capital to risk-weighted assets: Consolidated 221,024 11.95 110,988 6.00 Peoples Bank 215,027 11.64 110,859 6.00 147,811 8.00 Total capital to risk-weighted assets: Consolidated 242,403 13.10 147,984 8.00 Peoples Bank 236,406 12.80 147,811 8.00 184,764 10.00 Tier 1 capital to average assets: Consolidated 221,024 10.03 88,119 4.00 Peoples Bank 215,027 9.78 % 87,969 4.00 % 109,962 5.00 % Minimum to be Well Capitalized under Minimum For Capital Prompt Corrective Actual Adequacy Purposes Action Provisions December 31, 2017 Amount Ratio Amount Ratio Amount Ratio Common equity Tier 1 capital to risk-weighted assets: Consolidated $ 205,222 11.85 % $ 77,930 4.50 % Peoples Bank 199,450 11.53 77,843 4.50 $ 112,440 6.50 % Tier 1 capital to risk-weighted assets: Consolidated 205,222 11.85 103,906 6.00 Peoples Bank 199,450 11.53 103,791 6.00 138,388 8.00 Total capital to risk-weighted assets: Consolidated 224,182 12.95 138,542 8.00 Peoples Bank 218,410 12.63 138,388 8.00 172,985 10.00 Tier 1 capital to average assets: Consolidated 205,222 9.94 82,564 4.00 Peoples Bank 199,450 9.68 % 82,406 4.00 % 103,008 5.00 % |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accumulated Other Comprehensive Loss | |
Schedule of components of accumulated other comprehensive loss | December 31, 2018 December 31, 2017 Net unrealized loss on investment securities available-for-sale $ (3,251) $ (1,237) Income tax (683) (260) Net of income taxes (2,568) (977) Benefit plan adjustments (7,218) (6,628) Income tax (1,516) (1,392) Net of income taxes (5,702) (5,236) Derivative adjustments 246 Income tax 52 Net of income taxes 194 Accumulated other comprehensive loss $ (8,076) $ (6,213) |
Schedule of other comprehensive income (loss) and related tax effects | Year Ended December 31, 2018 2017 2016 Unrealized loss on investment securities available-for-sale $ (2,014) $ (1,790) $ (3,417) Net gain on the sale of investment securities available-for-sale (623) Benefit plans: Amortization of actuarial loss (2) 194 195 208 Actuarial gain (loss) (785) 123 709 Net change in benefit plan liabilities (591) 318 917 Net change in derivatives 246 Other comprehensive loss before taxes (2,359) (1,472) (3,123) Income tax (496) (515) (1,093) Other comprehensive loss $ (1,863) $ (957) $ (2,030) (1) Represents amounts reclassified out of accumulated comprehensive loss and included in gains on sale of investment securities on the consolidated statements of income and comprehensive income. Represents amounts reclassified out of accumulated comprehensive loss and included in the computation of net periodic pension expense. Refer to Note 15 included in these consolidated financial statements. |
Summary of quarterly financia_2
Summary of quarterly financial information (unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Summary of quarterly financial information (unaudited) | |
Summary of quarterly financial information | 2018 Quarter Ended March 31 June 30 Sept. 30 Dec. 31 Interest income $ 19,994 $ 20,766 $ 21,419 $ 22,482 Interest expense 2,807 3,115 3,466 3,934 Net interest income 17,187 17,651 17,953 18,548 Provision for loan losses 1,050 1,050 1,050 1,050 Net interest income after provision for loan losses 16,137 16,601 16,903 17,498 Noninterest income 3,572 3,663 3,253 3,171 Noninterest expense 13,081 13,496 12,537 13,373 Income before income taxes 6,628 6,768 7,619 7,296 Income tax expense 774 811 902 904 Net income $ 5,854 $ 5,957 $ 6,717 $ 6,392 Per share data: Net income $ 0.79 $ 0.81 $ 0.91 $ 0.86 Cash dividends declared $ 0.32 $ 0.33 $ 0.33 $ 0.33 Average common shares outstanding 7,396,505 7,396,533 7,399,054 7,399,054 2017 Quarter Ended March 31 June 30 Sept. 30 Dec. 31 Interest income $ 17,799 $ 18,261 $ 18,831 $ 19,351 Interest expense 1,956 2,126 2,175 2,441 Net interest income 15,843 16,135 16,656 16,910 Provision for loan losses 1,200 1,200 1,200 1,200 Net interest income after provision for loan losses 14,643 14,935 15,456 15,710 Noninterest income 3,782 6,379 3,661 3,364 Noninterest expense 12,356 14,002 12,480 12,455 Income before income taxes 6,069 7,312 6,637 6,619 Income tax expense 1,269 1,653 1,287 3,971 Net income $ 4,800 $ 5,659 $ 5,350 $ 2,648 Per share data: Net income $ 0.65 $ 0.77 $ 0.72 $ 0.36 Cash dividends declared $ 0.31 $ 0.31 $ 0.32 $ 0.32 Average common shares outstanding 7,394,143 7,396,163 7,396,505 7,396,505 |
Summary of significant accoun_4
Summary of significant accounting policies - Additional Information (Details) | 12 Months Ended | ||||
Dec. 31, 2018USD ($)Office | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Jan. 01, 2019USD ($) | Jan. 01, 2018USD ($) | |
Number of full-service community banking offices | Office | 27 | ||||
Number of limited purpose banking offices | $ 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 | ||
Advertising expense | $ 720,000 | 942,000 | 972,000 | ||
Income tax benefit recognition threshold | 50.00% | ||||
Unrecognized tax benefit or accrued interest and penalties | $ 0 | $ 0 | $ 0 | ||
Minimum | |||||
Contractual terms | 6 months | ||||
Maximum | |||||
Finite useful life of intangible assets | 10 years | ||||
Commercial Real Estate | |||||
Maximum loan to value percentage | 80.00% | ||||
Residential Mortgage | Maximum | |||||
Maximum amortization period | 30 years | ||||
Accounting Standards Update 2016-02 | Restatement Adjustment | |||||
Lease liabilities for operating leases | $ 5,500,000 | ||||
Right-of-use assets | $ 5,500,000 | ||||
Retained Earnings | Accounting Standards Update 2018-02 | |||||
Cumulative Effect of New Accounting Principle in Period of Adoption | $ 1,101,000 | ||||
Accumulated Other Comprehensive Loss | Accounting Standards Update 2018-02 | |||||
Cumulative Effect of New Accounting Principle in Period of Adoption | $ (1,101,000) |
Summary of significant accoun_5
Summary of significant accounting policies - Estimated Useful Lives of Related Assets (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Minimum | Premises and leasehold improvements | |
Property, Plant and Equipment | |
Property, plant and equipment, estimated useful life | 7 years |
Minimum | Furniture, fixtures and equipment | |
Property, Plant and Equipment | |
Property, plant and equipment, estimated useful life | 3 years |
Maximum | Premises and leasehold improvements | |
Property, Plant and Equipment | |
Property, plant and equipment, estimated useful life | 40 years |
Maximum | Furniture, fixtures and equipment | |
Property, Plant and Equipment | |
Property, plant and equipment, estimated useful life | 10 years |
Summary of significant accoun_6
Summary of significant accounting policies - Income Taxes (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Summary of significant accounting policies | ||||
Federal statutory rate | 21.00% | 35.00% | 35.00% | |
Increase in income tax expense due to Tax Cuts and Jobs Act | $ 2.6 | |||
Increase in income tax expense due to Tax Cuts and Jobs Act (in dollars per share) | $ 0.35 |
Summary of significant accoun_7
Summary of significant accounting policies - Schedule of Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Basic earnings per share | |||||||||||
Net Income, Basic | $ 24,920 | $ 18,457 | $ 19,583 | ||||||||
Net Income (Loss) Attributable to Parent | $ 6,392 | $ 6,717 | $ 5,957 | $ 5,854 | $ 2,648 | $ 5,350 | $ 5,659 | $ 4,800 | $ 24,920 | $ 18,457 | $ 19,583 |
Average common shares outstanding, Basic | 7,397,797 | 7,395,837 | 7,396,716 | ||||||||
Earnings per share, Basic | $ 3.37 | $ 2.50 | $ 2.65 | ||||||||
Diluted earnings per share | |||||||||||
Net Income, Diluted | $ 24,920 | $ 18,457 | $ 19,583 | ||||||||
Average common shares outstanding, Diluted | 7,397,797 | 7,395,837 | 7,396,716 | ||||||||
Earnings per share, Diluted | $ 3.37 | $ 2.50 | $ 2.65 |
Cash and due from banks (Detail
Cash and due from banks (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Cash and due from banks | ||
Required reserve balances | $ 2,768 | $ 22,651 |
Investment securities - Amortiz
Investment securities - Amortized Cost and Fair Value of Investment Securities Aggregated by Investment Category (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017USD ($) | Dec. 31, 2018USD ($)security | |
Schedule of Trading Securities and Other Trading Assets | ||
Available-for-sale, Amortized Cost | $ 273,742 | $ 272,933 |
Available-for-sale, Gross Unrealized Gains | 1,666 | 757 |
Available-for-sale, Gross Unrealized Losses | 2,906 | 4,008 |
Available-for-sale, Fair Value | 272,502 | 269,682 |
Available-for-sale, Fair Value | 272,502 | 269,682 |
Held-to-maturity, Amortized Cost | 9,274 | 8,361 |
Held-to-maturity, Gross Unrealized Gains | 290 | 67 |
Held-to-maturity, Gross Unrealized Losses | 17 | 48 |
Held-to-maturity, Fair value | 9,547 | 8,380 |
Equity investments carried at fair value | 46 | $ 291 |
Number of equity securities portfolio consisting of stock of other financial institutions | security | 2 | |
Net unrealized gains recognized in AOCI | 3 | |
State and Municipals Tax-exempt Bonds | ||
Schedule of Trading Securities and Other Trading Assets | ||
Held-to-maturity, Amortized Cost | $ 6,855 | |
Held-to-maturity, Gross Unrealized Gains | 12 | |
Held-to-maturity, Gross Unrealized Losses | 43 | |
Held-to-maturity, Fair value | 6,824 | |
Mortgage-backed Securities, U.S. Government agencies | ||
Schedule of Trading Securities and Other Trading Assets | ||
Available-for-sale, Amortized Cost | 14,517 | 12,663 |
Available-for-sale, Gross Unrealized Gains | 2 | 50 |
Available-for-sale, Gross Unrealized Losses | 85 | 84 |
Available-for-sale, Fair Value | 14,434 | 12,629 |
Held-to-maturity, Amortized Cost | 54 | 42 |
Held-to-maturity, Fair value | 54 | 42 |
Mortgage-backed Securities, U.S. Government-sponsored enterprises | ||
Schedule of Trading Securities and Other Trading Assets | ||
Available-for-sale, Amortized Cost | 19,752 | 33,149 |
Available-for-sale, Gross Unrealized Gains | 10 | 49 |
Available-for-sale, Gross Unrealized Losses | 231 | 401 |
Available-for-sale, Fair Value | 19,531 | 32,797 |
Held-to-maturity, Amortized Cost | 2,361 | 1,464 |
Held-to-maturity, Gross Unrealized Gains | 138 | 55 |
Held-to-maturity, Gross Unrealized Losses | 4 | 5 |
Held-to-maturity, Fair value | 2,495 | 1,514 |
Commercial mortgage-backed Securities, U.S. Government-sponsored enterprises | ||
Schedule of Trading Securities and Other Trading Assets | ||
Available-for-sale, Amortized Cost | 6,315 | 6,269 |
Available-for-sale, Gross Unrealized Losses | 120 | 230 |
Available-for-sale, Fair Value | 6,195 | 6,039 |
U.S. Government-sponsored enterprises state and municipals | ||
Schedule of Trading Securities and Other Trading Assets | ||
Available-for-sale, Amortized Cost | 95,358 | 94,999 |
Available-for-sale, Gross Unrealized Gains | 30 | 2 |
Available-for-sale, Gross Unrealized Losses | 1,740 | 2,183 |
Available-for-sale, Fair Value | 93,648 | 92,818 |
U.S. Treasuries | ||
Schedule of Trading Securities and Other Trading Assets | ||
Available-for-sale, Amortized Cost | 20,042 | 25,948 |
Available-for-sale, Gross Unrealized Gains | 9 | |
Available-for-sale, Gross Unrealized Losses | 228 | 365 |
Available-for-sale, Fair Value | 19,814 | 25,592 |
State and Municipals, Taxable | ||
Schedule of Trading Securities and Other Trading Assets | ||
Available-for-sale, Amortized Cost | 14,559 | 13,544 |
Available-for-sale, Gross Unrealized Gains | 488 | 309 |
Available-for-sale, Fair Value | 15,047 | 13,853 |
State and Municipals, Tax-exempt | ||
Schedule of Trading Securities and Other Trading Assets | ||
Available-for-sale, Amortized Cost | 103,199 | 86,361 |
Available-for-sale, Gross Unrealized Gains | 1,136 | 338 |
Available-for-sale, Gross Unrealized Losses | 502 | 745 |
Available-for-sale, Fair Value | 103,833 | $ 85,954 |
Held-to-maturity, Amortized Cost | 6,859 | |
Held-to-maturity, Gross Unrealized Gains | 152 | |
Held-to-maturity, Gross Unrealized Losses | 13 | |
Held-to-maturity, Fair value | $ 6,998 |
Investment securities - Unreali
Investment securities - Unrealized and realized gains and losses (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Investment securities | |||
Net gains recognized during the period on equity securities | $ 14 | $ 623 | |
Unrealized gains and (losses) recognized during the reporting period on equity securities still held at the reporting date | 14 | ||
Realized gains or losses on sold investment securities | $ 0 | $ 0 |
Investment securities - Maturit
Investment securities - Maturity Distribution of Debt Securities Classified as Available-for-Sale (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Investment securities | |
Within one year | $ 38,925 |
After one but within five years | 152,806 |
After five but within ten years | 15,900 |
After ten years | 10,586 |
Available for sale securities | 218,217 |
Mortgage-backed securities | 51,465 |
Total | $ 269,682 |
Investment securities - Summary
Investment securities - Summary of Amortized Cost and Fair Value of Securities by Contractual Maturity (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Amortized Cost of Held-to-maturity Securities | ||
Amortized Cost, After ten years, Held to maturity | $ 6,855 | |
Amortized Cost, Held to maturity | 6,855 | |
Amortized Cost, Mortgage-backed securities, Held to maturity | 1,506 | |
Held-to-maturity, Amortized Cost | 8,361 | $ 9,274 |
Fair Value of Held-to-maturity Securities | ||
Fair Value, After ten years, Held to maturity | 6,824 | |
Fair Value, Held to maturity | 6,824 | |
Fair Value, Mortgage-backed securities, Held to maturity | 1,556 | |
Held to maturity, Fair Value | $ 8,380 | $ 9,547 |
Investment securities - Pledged
Investment securities - Pledged Securities (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Investment securities | ||
Carrying value of securities pledged | $ 161,647 | $ 163,936 |
Carrying value of securities pledged | us-gaap:AssetPledgedAsCollateralMember | us-gaap:AssetPledgedAsCollateralMember |
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, 2018 | Dec. 31, 2017 |
Available-for-sale and Held-to-maturity securities | ||
Less Than 12 Months, Fair Value | $ 25,905 | $ 139,450 |
12 Months or More, Fair Value | 189,472 | 68,109 |
Less Than 12 Months, Unrealized Losses | 132 | 1,331 |
12 Months or More, Unrealized Losses | 3,924 | 1,592 |
Total, Fair Value | 215,377 | 207,559 |
Total, Unrealized Losses | 4,056 | 2,923 |
State and Municipals, Tax-exempt | ||
Available-for-sale and Held-to-maturity securities | ||
Less Than 12 Months, Fair Value | 9,022 | 54,788 |
12 Months or More, Fair Value | 52,352 | 3,808 |
Less Than 12 Months, Unrealized Losses | 74 | 454 |
12 Months or More, Unrealized Losses | 714 | 61 |
Total, Fair Value | 61,374 | 58,596 |
Total, Unrealized Losses | 788 | 515 |
U.S. Treasuries | ||
Available-for-sale and Held-to-maturity securities | ||
Less Than 12 Months, Fair Value | 1,995 | 17,350 |
12 Months or More, Fair Value | 19,671 | 2,464 |
Less Than 12 Months, Unrealized Losses | 2 | 170 |
12 Months or More, Unrealized Losses | 363 | 58 |
Total, Fair Value | 21,666 | 19,814 |
Total, Unrealized Losses | 365 | 228 |
U.S. Government-sponsored enterprises state and municipals | ||
Available-for-sale and Held-to-maturity securities | ||
Less Than 12 Months, Fair Value | 2,037 | 39,096 |
12 Months or More, Fair Value | 89,729 | 51,365 |
Less Than 12 Months, Unrealized Losses | 1 | 445 |
12 Months or More, Unrealized Losses | 2,182 | 1,295 |
Total, Fair Value | 91,766 | 90,461 |
Total, Unrealized Losses | 2,183 | 1,740 |
Mortgage-backed Securities, U.S. Government agencies | ||
Available-for-sale and Held-to-maturity securities | ||
Less Than 12 Months, Fair Value | 9,484 | |
12 Months or More, Fair Value | 7,800 | 3,968 |
Less Than 12 Months, Unrealized Losses | 39 | |
12 Months or More, Unrealized Losses | 84 | 46 |
Total, Fair Value | 7,800 | 13,452 |
Total, Unrealized Losses | 84 | 85 |
Commercial mortgage-backed Securities, U.S. Government-sponsored enterprises | ||
Available-for-sale and Held-to-maturity securities | ||
Less Than 12 Months, Fair Value | 6,195 | |
12 Months or More, Fair Value | 6,039 | |
Less Than 12 Months, Unrealized Losses | 120 | |
12 Months or More, Unrealized Losses | 230 | |
Total, Fair Value | 6,039 | 6,195 |
Total, Unrealized Losses | 230 | 120 |
Mortgage-backed Securities, U.S. Government-sponsored enterprises | ||
Available-for-sale and Held-to-maturity securities | ||
Less Than 12 Months, Fair Value | 12,851 | 12,537 |
12 Months or More, Fair Value | 13,881 | 6,504 |
Less Than 12 Months, Unrealized Losses | 55 | 103 |
12 Months or More, Unrealized Losses | 351 | 132 |
Total, Fair Value | 26,732 | 19,041 |
Total, Unrealized Losses | $ 406 | $ 235 |
Investment securities - Additio
Investment securities - Additional Information (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018USD ($)security | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | |
Available-for-sale and Held-to-maturity securities | |||
Unrealized gains, net | $ | $ 2,568 | $ 977 | |
Net of deferred income taxes | $ | 683 | 260 | |
Proceeds from sale of available-for-sale investment securities | $ | $ 0 | 0 | $ 27,408 |
Gross realized gains | $ | 623 | ||
Gross realized losses | $ | 0 | ||
Number of investment securities held | 187 | ||
Other-than-temporary impairments recognized | $ | $ 0 | $ 0 | $ 0 |
State and Municipals, Tax-exempt | |||
Available-for-sale and Held-to-maturity securities | |||
Number of investment securities held | 104 | ||
Number of securities in continuous unrealized loss positions 12 months or longer | 88 | ||
U.S. Treasuries | |||
Available-for-sale and Held-to-maturity securities | |||
Number of securities in continuous unrealized loss positions 12 months or longer | 7 | ||
U.S. Treasuries | State and Municipals, Tax-exempt | |||
Available-for-sale and Held-to-maturity securities | |||
Number of investment securities held | 8 | ||
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% | 10.00% | |
Number of investment securities held | 37 | ||
Number of securities in continuous unrealized loss positions 12 months or longer | 35 | ||
Mortgage-backed Securities, Issued by Government Agencies | United States | |||
Available-for-sale and Held-to-maturity securities | |||
Number of investment securities held | 38 | ||
Mortgage-backed Securities, U.S. Government-sponsored enterprises | |||
Available-for-sale and Held-to-maturity securities | |||
Number of securities in continuous unrealized loss positions 12 months or longer | 33 |
Investment securities - Addit_2
Investment securities - Additional Information (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018USD ($)shares | Dec. 31, 2017USD ($) | |
Value of common stock | $ | $ 14,798 | $ 14,793 |
Visa Class A stock | ||
Conversion ratio of common stock | 1.6298 | |
Shares to be issued following resolution of Visa litigation | 73,312 | |
Visa Class B stock | ||
Shares held | 44,982 |
Loans, net and allowance for _3
Loans, net and allowance for loan losses - Net Deferred Loan Costs (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Loans, net and allowance for loan losses | ||||
Net deferred loan costs | $ 744,000 | $ 575,000 | ||
Loans outstanding to directors, executive officers, principal stockholders or to their affiliates | 14,701,000 | 15,169,000 | ||
Advances and repayments of loans receivable | 1,657,000 | 1,947,000 | ||
Number of related party loans classified as nonaccrual, past due, or restructured | 0 | 0 | ||
Deposits from related parties | 16,200,000 | 10,000,000 | ||
Interest income recognized using the cash-basis method on impaired loans | $ 0 | $ 0 | $ 0 | $ 0 |
Loans, net and allowance for _4
Loans, net and allowance for loan losses - Major Classifications of Loans Outstanding (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | $ 1,823,266 | $ 1,693,065 | $ 1,532,965 |
Commercial | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 494,134 | 476,199 | 408,814 |
Real estate Commercial | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 907,803 | 786,210 | 700,144 |
Consumer | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | $ 121,453 | $ 142,721 | $ 134,226 |
Loans, net and allowance for _5
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, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Allowance for loan losses: | ||||||||||||||
Beginning Balance | $ 18,960 | $ 15,961 | $ 18,960 | $ 15,961 | $ 12,975 | |||||||||
Charge-offs | (2,354) | (2,149) | (2,468) | |||||||||||
Recoveries | 573 | 348 | 454 | |||||||||||
Provisions | $ 1,050 | $ 1,050 | $ 1,050 | 1,050 | $ 1,200 | $ 1,200 | $ 1,200 | 1,200 | 4,200 | 4,800 | 5,000 | |||
Ending balance | 21,379 | 18,960 | 21,379 | 18,960 | 15,961 | |||||||||
Beginning Balance | 18,960 | 15,961 | 18,960 | 15,961 | 12,975 | |||||||||
Ending balance: individually evaluated for impairment | $ 1,179 | $ 766 | $ 1,942 | |||||||||||
Charge-offs | (2,354) | (2,149) | (2,468) | |||||||||||
Ending balance: collectively evaluated for impairment | 20,200 | 18,194 | 14,019 | |||||||||||
Recoveries | 573 | 348 | 454 | |||||||||||
Ending balance: loans acquired with deteriorated credit quality | 21,379 | 18,960 | 18,960 | 15,961 | 18,960 | 15,961 | 12,975 | 21,379 | 18,960 | 15,961 | ||||
Provisions | 1,050 | $ 1,050 | $ 1,050 | 1,050 | 1,200 | $ 1,200 | $ 1,200 | 1,200 | 4,200 | 4,800 | 5,000 | |||
Loans receivable: | ||||||||||||||
Total Loans | 1,823,266 | 1,693,065 | 1,532,965 | |||||||||||
Ending balance: individually evaluated for impairment | 9,641 | 10,722 | 13,579 | |||||||||||
Ending balance: collectively evaluated for impairment | 1,813,625 | 1,682,343 | 1,519,386 | |||||||||||
Total Loans | 1,823,266 | 1,693,065 | 1,532,965 | |||||||||||
Ending balance | 21,379 | 18,960 | 21,379 | 18,960 | 15,961 | |||||||||
Ending balance: individually evaluated for impairment | 9,641 | 10,722 | 13,579 | |||||||||||
Ending balance: collectively evaluated for impairment | 1,813,625 | 1,682,343 | 1,519,386 | |||||||||||
Commercial | ||||||||||||||
Allowance for loan losses: | ||||||||||||||
Beginning Balance | 5,513 | 4,452 | 5,513 | 4,452 | 4,113 | |||||||||
Charge-offs | (154) | (173) | (776) | |||||||||||
Recoveries | 137 | 20 | 86 | |||||||||||
Provisions | 20 | 1,214 | 1,029 | |||||||||||
Ending balance | 5,516 | 5,513 | 5,516 | 5,513 | 4,452 | |||||||||
Beginning Balance | 5,513 | 4,452 | 5,513 | 4,452 | 4,113 | |||||||||
Ending balance: individually evaluated for impairment | 50 | 159 | 225 | |||||||||||
Charge-offs | (154) | (173) | (776) | |||||||||||
Ending balance: collectively evaluated for impairment | 5,466 | 5,354 | 4,227 | |||||||||||
Recoveries | 137 | 20 | 86 | |||||||||||
Ending balance: loans acquired with deteriorated credit quality | 5,516 | 5,513 | 5,513 | 4,452 | 5,513 | 4,452 | 4,113 | 5,516 | 5,513 | 4,452 | ||||
Provisions | 20 | 1,214 | 1,029 | |||||||||||
Loans receivable: | ||||||||||||||
Total Loans | 494,134 | 476,199 | 408,814 | |||||||||||
Ending balance: individually evaluated for impairment | 2,237 | 2,463 | 2,687 | |||||||||||
Ending balance: collectively evaluated for impairment | 491,897 | 473,736 | 406,127 | |||||||||||
Total Loans | 494,134 | 476,199 | 408,814 | |||||||||||
Ending balance | 5,516 | 5,513 | 5,516 | 5,513 | 4,452 | |||||||||
Ending balance: individually evaluated for impairment | 2,237 | 2,463 | 2,687 | |||||||||||
Ending balance: collectively evaluated for impairment | 491,897 | 473,736 | 406,127 | |||||||||||
Real estate Commercial | ||||||||||||||
Allowance for loan losses: | ||||||||||||||
Beginning Balance | 8,944 | 7,548 | 8,944 | 7,548 | 4,751 | |||||||||
Charge-offs | (1,250) | (706) | (858) | |||||||||||
Recoveries | 136 | 124 | 122 | |||||||||||
Provisions | 2,906 | 1,978 | 3,533 | |||||||||||
Ending balance | 10,736 | 8,944 | 10,736 | 8,944 | 7,548 | |||||||||
Beginning Balance | 8,944 | 7,548 | 8,944 | 7,548 | 4,751 | |||||||||
Ending balance: individually evaluated for impairment | 403 | 263 | 1,197 | |||||||||||
Charge-offs | (1,250) | (706) | (858) | |||||||||||
Ending balance: collectively evaluated for impairment | 10,333 | 8,681 | 6,351 | |||||||||||
Recoveries | 136 | 124 | 122 | |||||||||||
Ending balance: loans acquired with deteriorated credit quality | 10,736 | 8,944 | 8,944 | 7,548 | 8,944 | 7,548 | 4,751 | 10,736 | 8,944 | 7,548 | ||||
Provisions | 2,906 | 1,978 | 3,533 | |||||||||||
Loans receivable: | ||||||||||||||
Total Loans | 907,803 | 786,210 | 700,144 | |||||||||||
Ending balance: individually evaluated for impairment | 3,121 | 4,289 | 7,157 | |||||||||||
Ending balance: collectively evaluated for impairment | 904,682 | 781,921 | 692,987 | |||||||||||
Total Loans | 907,803 | 786,210 | 700,144 | |||||||||||
Ending balance | 10,736 | 8,944 | 10,736 | 8,944 | 7,548 | |||||||||
Ending balance: individually evaluated for impairment | 3,121 | 4,289 | 7,157 | |||||||||||
Ending balance: collectively evaluated for impairment | 904,682 | 781,921 | 692,987 | |||||||||||
Real estate Residential | ||||||||||||||
Allowance for loan losses: | ||||||||||||||
Beginning Balance | 3,111 | 2,961 | 3,111 | 2,961 | 3,174 | |||||||||
Charge-offs | (405) | (533) | (339) | |||||||||||
Recoveries | 98 | 44 | 69 | |||||||||||
Provisions | 1,088 | 639 | 57 | |||||||||||
Ending balance | 3,892 | 3,111 | 3,892 | 3,111 | 2,961 | |||||||||
Beginning Balance | 3,111 | 2,961 | 3,111 | 2,961 | 3,174 | |||||||||
Ending balance: individually evaluated for impairment | 666 | 336 | 520 | |||||||||||
Charge-offs | (405) | (533) | (339) | |||||||||||
Ending balance: collectively evaluated for impairment | 3,226 | 2,775 | 2,441 | |||||||||||
Recoveries | 98 | 44 | 69 | |||||||||||
Ending balance: loans acquired with deteriorated credit quality | 3,892 | 3,111 | 3,111 | 2,961 | 3,111 | 2,961 | 3,174 | 3,892 | 3,111 | 2,961 | ||||
Provisions | 1,088 | 639 | 57 | |||||||||||
Loans receivable: | ||||||||||||||
Total Loans | 299,876 | 287,935 | 289,781 | |||||||||||
Ending balance: individually evaluated for impairment | 4,071 | 3,793 | 3,580 | |||||||||||
Ending balance: collectively evaluated for impairment | 295,805 | 284,142 | 286,201 | |||||||||||
Total Loans | 299,876 | 287,935 | 289,781 | |||||||||||
Ending balance | 3,892 | 3,111 | 3,892 | 3,111 | 2,961 | |||||||||
Ending balance: individually evaluated for impairment | 4,071 | 3,793 | 3,580 | |||||||||||
Ending balance: collectively evaluated for impairment | 295,805 | 284,142 | 286,201 | |||||||||||
Consumer | ||||||||||||||
Allowance for loan losses: | ||||||||||||||
Beginning Balance | 1,392 | 1,000 | 1,392 | 1,000 | 937 | |||||||||
Charge-offs | (545) | (737) | (495) | |||||||||||
Recoveries | 202 | 160 | 177 | |||||||||||
Provisions | 186 | 969 | 381 | |||||||||||
Ending balance | 1,235 | 1,392 | 1,235 | 1,392 | 1,000 | |||||||||
Beginning Balance | 1,392 | 1,000 | 1,392 | 1,000 | 937 | |||||||||
Ending balance: individually evaluated for impairment | 60 | 8 | ||||||||||||
Charge-offs | (545) | (737) | (495) | |||||||||||
Ending balance: collectively evaluated for impairment | 1,175 | 1,384 | 1,000 | |||||||||||
Recoveries | 202 | 160 | 177 | |||||||||||
Ending balance: loans acquired with deteriorated credit quality | 1,235 | $ 1,392 | 1,392 | $ 1,000 | 1,392 | 1,000 | 937 | 1,235 | 1,392 | 1,000 | ||||
Provisions | 186 | 969 | 381 | |||||||||||
Loans receivable: | ||||||||||||||
Total Loans | 121,453 | 142,721 | 134,226 | |||||||||||
Ending balance: individually evaluated for impairment | 212 | 177 | 155 | |||||||||||
Ending balance: collectively evaluated for impairment | 121,241 | 142,544 | 134,071 | |||||||||||
Total Loans | 121,453 | 142,721 | 134,226 | |||||||||||
Ending balance | $ 1,235 | $ 1,392 | $ 1,235 | $ 1,392 | $ 1,000 | |||||||||
Ending balance: individually evaluated for impairment | 212 | 177 | 155 | |||||||||||
Ending balance: collectively evaluated for impairment | $ 121,241 | $ 142,544 | $ 134,071 |
Loans, net and allowance for _6
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, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Allowance for loan losses: | ||||
Ending balance | $ 21,379 | $ 18,960 | $ 15,961 | $ 12,975 |
Ending balance: individually evaluated for impairment | 1,179 | 766 | 1,942 | |
Ending balance: collectively evaluated for impairment | 20,200 | 18,194 | 14,019 | |
Loans receivable: | ||||
Ending balance | 1,823,266 | 1,693,065 | 1,532,965 | |
Ending balance: individually evaluated for impairment | 9,641 | 10,722 | 13,579 | |
Ending balance: collectively evaluated for impairment | 1,813,625 | 1,682,343 | 1,519,386 | |
Commercial | ||||
Allowance for loan losses: | ||||
Ending balance | 5,516 | 5,513 | 4,452 | 4,113 |
Ending balance: individually evaluated for impairment | 50 | 159 | 225 | |
Ending balance: collectively evaluated for impairment | 5,466 | 5,354 | 4,227 | |
Loans receivable: | ||||
Ending balance | 494,134 | 476,199 | 408,814 | |
Ending balance: individually evaluated for impairment | 2,237 | 2,463 | 2,687 | |
Ending balance: collectively evaluated for impairment | 491,897 | 473,736 | 406,127 | |
Real estate Commercial | ||||
Allowance for loan losses: | ||||
Ending balance | 10,736 | 8,944 | 7,548 | 4,751 |
Ending balance: individually evaluated for impairment | 403 | 263 | 1,197 | |
Ending balance: collectively evaluated for impairment | 10,333 | 8,681 | 6,351 | |
Loans receivable: | ||||
Ending balance | 907,803 | 786,210 | 700,144 | |
Ending balance: individually evaluated for impairment | 3,121 | 4,289 | 7,157 | |
Ending balance: collectively evaluated for impairment | 904,682 | 781,921 | 692,987 | |
Consumer | ||||
Allowance for loan losses: | ||||
Ending balance | 1,235 | 1,392 | 1,000 | $ 937 |
Ending balance: individually evaluated for impairment | 60 | 8 | ||
Ending balance: collectively evaluated for impairment | 1,175 | 1,384 | 1,000 | |
Loans receivable: | ||||
Ending balance | 121,453 | 142,721 | 134,226 | |
Ending balance: individually evaluated for impairment | 212 | 177 | 155 | |
Ending balance: collectively evaluated for impairment | $ 121,241 | $ 142,544 | $ 134,071 |
Loans, net and allowance for _7
Loans, net and allowance for loan losses - Major Classification of Loans Portfolio Summarized by Credit Quality (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | $ 1,823,266 | $ 1,693,065 | $ 1,532,965 |
Commercial | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 494,134 | 476,199 | 408,814 |
Real estate Commercial | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 907,803 | 786,210 | 700,144 |
Real estate Residential | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 299,876 | 287,935 | 289,781 |
Consumer | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 121,453 | 142,721 | $ 134,226 |
Pass | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 1,795,367 | 1,661,496 | |
Pass | Commercial | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 491,531 | 472,185 | |
Pass | Real estate Commercial | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 886,849 | 764,320 | |
Pass | Real estate Residential | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 295,758 | 282,484 | |
Pass | Consumer | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 121,229 | 142,507 | |
Special Mention | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 10,160 | 14,991 | |
Special Mention | Commercial | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 869 | 1,958 | |
Special Mention | Real estate Commercial | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 8,934 | 13,015 | |
Special Mention | Real estate Residential | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 357 | 18 | |
Substandard | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 17,739 | 16,578 | |
Substandard | Commercial | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 1,734 | 2,056 | |
Substandard | Real estate Commercial | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 12,020 | 8,875 | |
Substandard | Real estate Residential | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | 3,761 | 5,433 | |
Substandard | Consumer | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loans, net | $ 224 | $ 214 |
Loans, net and allowance for _8
Loans, net and allowance for loan losses - Information Concerning Nonaccrual Loans by Major Loan Classification (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Financing Receivable, Recorded Investment, Past Due | ||
Nonaccrual loans, Total | $ 6,231 | $ 7,852 |
Commercial | ||
Financing Receivable, Recorded Investment, Past Due | ||
Nonaccrual loans, Total | 776 | 860 |
Real estate Commercial | ||
Financing Receivable, Recorded Investment, Past Due | ||
Nonaccrual loans, Total | 2,663 | 3,821 |
Real estate Residential | ||
Financing Receivable, Recorded Investment, Past Due | ||
Nonaccrual loans, Total | 2,580 | 2,994 |
Consumer | ||
Financing Receivable, Recorded Investment, Past Due | ||
Nonaccrual loans, Total | $ 212 | $ 177 |
Loans, net and allowance for _9
Loans, net and allowance for loan losses - Major Classification of Loans by Past Due Status (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | $ 15,392 | $ 14,993 | |
Current | 1,807,874 | 1,678,072 | |
Total Loans | 1,823,266 | 1,693,065 | $ 1,532,965 |
Loans > 90 Days and Accruing | 923 | 735 | |
30-59 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 6,104 | 4,081 | |
60-89 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 2,134 | 2,325 | |
Greater than 90 Days | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 7,154 | 8,587 | |
Commercial | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 1,828 | 1,200 | |
Current | 492,306 | 474,999 | |
Total Loans | 494,134 | 476,199 | 408,814 |
Commercial | 30-59 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 973 | 124 | |
Commercial | 60-89 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 79 | 216 | |
Commercial | Greater than 90 Days | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 776 | 860 | |
Real estate Commercial | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 4,843 | 5,737 | |
Current | 902,960 | 780,473 | |
Total Loans | 907,803 | 786,210 | 700,144 |
Loans > 90 Days and Accruing | 73 | ||
Real estate Commercial | 30-59 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 1,889 | 1,722 | |
Real estate Commercial | 60-89 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 218 | 194 | |
Real estate Commercial | Greater than 90 Days | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 2,736 | 3,821 | |
Real estate Residential | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 7,461 | 6,228 | |
Current | 292,415 | 281,707 | |
Total Loans | 299,876 | 287,935 | 289,781 |
Loans > 90 Days and Accruing | 850 | 549 | |
Real estate Residential | 30-59 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 2,486 | 1,134 | |
Real estate Residential | 60-89 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 1,545 | 1,551 | |
Real estate Residential | Greater than 90 Days | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 3,430 | 3,543 | |
Consumer | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 1,260 | 1,828 | |
Current | 120,193 | 140,893 | |
Total Loans | 121,453 | 142,721 | $ 134,226 |
Loans > 90 Days and Accruing | 186 | ||
Consumer | 30-59 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 756 | 1,101 | |
Consumer | 60-89 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | 292 | 364 | |
Consumer | Greater than 90 Days | |||
Financing Receivable, Recorded Investment, Past Due | |||
Total Past Due | $ 212 | $ 363 |
Loans, net and allowance for_10
Loans, net and allowance for loan losses - Summarized Information in Concerning to Impaired Loans (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Financing Receivable, Impaired | |||
Recorded Investment, With no related allowance, Total | $ 5,653 | $ 6,532 | $ 7,128 |
Unpaid Principal Balance, With no related allowance, Total | 7,017 | 7,482 | 8,774 |
Average Recorded Investment, With no related allowance, Total | 6,468 | 7,053 | 8,041 |
Interest Income Recognized, With no related allowance, Total | 117 | 88 | 154 |
Recorded Investment, With an allowance recorded, Total | 3,988 | 4,190 | 6,451 |
Unpaid Principal Balance, With an allowance recorded, Total | 4,386 | 4,481 | 6,452 |
Related Allowance, With an allowance recorded, Total | 1,179 | 766 | 1,942 |
Average Recorded Investment, With an allowance recorded, Total | 4,288 | 4,548 | 4,460 |
Interest Income Recognized, With an allowance recorded, Total | 70 | 91 | 9 |
Recorded Investment, Total | 9,641 | 10,722 | 13,579 |
Unpaid Principal Balance, Total | 11,403 | 11,963 | 15,226 |
Related Allowance, With an allowance recorded, Total | 1,179 | 766 | 1,942 |
Average Recorded Investment, Total | 10,756 | 11,601 | 12,501 |
Interest Income Recognized, Total | 187 | 179 | 163 |
Commercial | |||
Financing Receivable, Impaired | |||
Recorded Investment, With no related allowance, Total | 1,562 | 1,279 | 2,404 |
Unpaid Principal Balance, With no related allowance, Total | 1,900 | 1,439 | 3,213 |
Average Recorded Investment, With no related allowance, Total | 1,318 | 1,668 | 1,461 |
Interest Income Recognized, With no related allowance, Total | 67 | 43 | 48 |
Recorded Investment, With an allowance recorded, Total | 675 | 1,184 | 283 |
Unpaid Principal Balance, With an allowance recorded, Total | 675 | 1,218 | 283 |
Related Allowance, With an allowance recorded, Total | 50 | 159 | 225 |
Average Recorded Investment, With an allowance recorded, Total | 1,006 | 991 | 859 |
Interest Income Recognized, With an allowance recorded, Total | 30 | 50 | |
Recorded Investment, Total | 2,237 | 2,463 | 2,687 |
Unpaid Principal Balance, Total | 2,575 | 2,657 | 3,496 |
Related Allowance, With an allowance recorded, Total | 50 | 159 | 225 |
Average Recorded Investment, Total | 2,324 | 2,659 | 2,320 |
Interest Income Recognized, Total | 97 | 93 | 48 |
Real estate Commercial | |||
Financing Receivable, Impaired | |||
Recorded Investment, With no related allowance, Total | 1,969 | 2,888 | 2,364 |
Unpaid Principal Balance, With no related allowance, Total | 2,299 | 3,190 | 3,018 |
Average Recorded Investment, With no related allowance, Total | 2,822 | 2,985 | 4,300 |
Interest Income Recognized, With no related allowance, Total | 28 | 24 | 71 |
Recorded Investment, With an allowance recorded, Total | 1,152 | 1,401 | 4,793 |
Unpaid Principal Balance, With an allowance recorded, Total | 1,323 | 1,496 | 4,793 |
Related Allowance, With an allowance recorded, Total | 403 | 263 | 1,197 |
Average Recorded Investment, With an allowance recorded, Total | 1,676 | 2,202 | 2,366 |
Interest Income Recognized, With an allowance recorded, Total | 18 | 18 | 2 |
Recorded Investment, Total | 3,121 | 4,289 | 7,157 |
Unpaid Principal Balance, Total | 3,622 | 4,686 | 7,811 |
Related Allowance, With an allowance recorded, Total | 403 | 263 | 1,197 |
Average Recorded Investment, Total | 4,498 | 5,187 | 6,666 |
Interest Income Recognized, Total | 46 | 42 | 73 |
Real estate Residential | |||
Financing Receivable, Impaired | |||
Recorded Investment, With no related allowance, Total | 1,970 | 2,196 | 2,205 |
Unpaid Principal Balance, With no related allowance, Total | 2,658 | 2,672 | 2,388 |
Average Recorded Investment, With no related allowance, Total | 2,193 | 2,227 | 2,133 |
Interest Income Recognized, With no related allowance, Total | 22 | 21 | 35 |
Recorded Investment, With an allowance recorded, Total | 2,101 | 1,597 | 1,375 |
Unpaid Principal Balance, With an allowance recorded, Total | 2,328 | 1,759 | 1,376 |
Related Allowance, With an allowance recorded, Total | 666 | 336 | 520 |
Average Recorded Investment, With an allowance recorded, Total | 1,585 | 1,335 | 1,185 |
Interest Income Recognized, With an allowance recorded, Total | 22 | 23 | 7 |
Recorded Investment, Total | 4,071 | 3,793 | 3,580 |
Unpaid Principal Balance, Total | 4,986 | 4,431 | 3,764 |
Related Allowance, With an allowance recorded, Total | 666 | 336 | 520 |
Average Recorded Investment, Total | 3,778 | 3,562 | 3,318 |
Interest Income Recognized, Total | 44 | 44 | 42 |
Consumer | |||
Financing Receivable, Impaired | |||
Recorded Investment, With no related allowance, Total | 152 | 169 | 155 |
Unpaid Principal Balance, With no related allowance, Total | 160 | 181 | 155 |
Average Recorded Investment, With no related allowance, Total | 135 | 173 | 147 |
Recorded Investment, With an allowance recorded, Total | 60 | 8 | |
Unpaid Principal Balance, With an allowance recorded, Total | 60 | 8 | |
Related Allowance, With an allowance recorded, Total | 60 | 8 | |
Average Recorded Investment, With an allowance recorded, Total | 21 | 20 | 50 |
Recorded Investment, Total | 212 | 177 | 155 |
Unpaid Principal Balance, Total | 220 | 189 | 155 |
Related Allowance, With an allowance recorded, Total | 60 | 8 | |
Average Recorded Investment, Total | $ 156 | $ 193 | $ 197 |
Loans, net and allowance for_11
Loans, net and allowance for loan losses - Loans Modified Resulting in Troubled Debt Restructurings (Details) | 12 Months Ended | ||||||||
Dec. 31, 2018USD ($)loan | Dec. 31, 2018USD ($)contract | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($)loan | Dec. 31, 2017USD ($)contract | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($)loan | Dec. 31, 2016USD ($)contract | Dec. 31, 2016USD ($) | |
Loans in the formal process of foreclosure | $ 1,823,000 | $ 1,823,000 | $ 1,823,000 | $ 1,684,000 | $ 1,684,000 | $ 1,684,000 | |||
Number of loans modified | 1 | 1 | 6 | 6 | 3 | 3 | |||
Pre-Modification Outstanding Recorded Investment | 340,000 | 1,670,000 | $ 1,716,000 | ||||||
Post-Modification Outstanding Recorded Investment | 340,000 | 1,670,000 | 1,366,000 | ||||||
Recorded Investment | $ 340,000 | $ 340,000 | 340,000 | $ 1,628,000 | $ 1,628,000 | 1,628,000 | $ 1,357,000 | $ 1,357,000 | 1,357,000 |
Number of defaults on loans restructured | 0 | 0 | 1 | ||||||
Loans modified as troubled debt restructuring | 43,000 | ||||||||
Loans receivable, related parties, considered as nonaccrual, past due or restructured or potential credit risk | 2,779,000 | $ 2,779,000 | 2,779,000 | 3,074,000 | $ 3,074,000 | 3,074,000 | |||
Commercial | |||||||||
Number of loans modified | contract | 2 | 1 | |||||||
Pre-Modification Outstanding Recorded Investment | 885,000 | 1,500,000 | |||||||
Post-Modification Outstanding Recorded Investment | 885,000 | 1,150,000 | |||||||
Recorded Investment | 864,000 | $ 864,000 | 864,000 | 1,150,000 | $ 1,150,000 | 1,150,000 | |||
Real estate Commercial | |||||||||
Number of loans modified | contract | 1 | 3 | |||||||
Pre-Modification Outstanding Recorded Investment | 340,000 | 721,000 | |||||||
Post-Modification Outstanding Recorded Investment | 340,000 | 721,000 | |||||||
Recorded Investment | $ 340,000 | $ 340,000 | $ 340,000 | 700,000 | $ 700,000 | 700,000 | |||
Real estate Residential | |||||||||
Number of loans modified | contract | 1 | 2 | |||||||
Pre-Modification Outstanding Recorded Investment | 64,000 | 216,000 | |||||||
Post-Modification Outstanding Recorded Investment | 64,000 | 216,000 | |||||||
Recorded Investment | $ 64,000 | $ 64,000 | $ 64,000 | $ 207,000 | $ 207,000 | $ 207,000 |
Off-balance sheet financial i_3
Off-balance sheet financial instruments - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Off-balance sheet financial instruments. | ||
Expiration period of standby letters | 12 months | |
Amount of standby letters of credit | $ 22,415 | $ 14,049 |
Off-balance sheet financial i_4
Off-balance sheet financial instruments - Summary of Contractual Amounts of Off-balance Sheet Commitments (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Off-balance sheet financial instruments. | ||
Commitments to extend credit | $ 294,122 | $ 324,984 |
Unused portions of lines of credit | 51,790 | 56,244 |
Standby letters of credit | 33,275 | 23,387 |
Total contractual amounts of off-balance sheet commitments | $ 379,187 | $ 404,615 |
Premises and equipment, net - S
Premises and equipment, net - Summary of Premises and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Property, Plant and Equipment | ||
Premises and equipment, gross | $ 65,160 | $ 61,596 |
Less: accumulated depreciation | 26,271 | 24,039 |
Premises and equipment, net | 38,889 | 37,557 |
Land | ||
Property, Plant and Equipment | ||
Premises and equipment, gross | 5,535 | 5,875 |
Premises and leasehold improvements | ||
Property, Plant and Equipment | ||
Premises and equipment, gross | 44,813 | 42,472 |
Furniture, fixtures and equipment | ||
Property, Plant and Equipment | ||
Premises and equipment, gross | $ 14,812 | $ 13,249 |
Premises and equipment, net - A
Premises and equipment, net - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment | |||
Depreciation of premises and equipment | $ 2,333 | $ 1,950 | $ 1,661 |
Rent expense | $ 492 | $ 407 | $ 416 |
Minimum | |||
Property, Plant and Equipment | |||
Leases extension period | 1 year | ||
Maximum | |||
Property, Plant and Equipment | |||
Leases extension period | 10 years |
Premises and equipment, net -_2
Premises and equipment, net - Summary of Future Minimum Rental Commitments Under Operating Leases (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity | |
2019 | $ 532 |
2020 | 527 |
2021 | 514 |
2022 | 516 |
2023 | 432 |
Thereafter | 5,024 |
Future minimum annual rent commitments under various operating leases | $ 7,545 |
Intangible assets, net - Additi
Intangible assets, net - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Finite-Lived Intangible Assets | |||
Gross carrying amount of intangible assets | $ 1,091 | $ 1,091 | |
Amortization of intangibles | 881 | 1,034 | $ 1,186 |
Core Deposit | |||
Finite-Lived Intangible Assets | |||
Gross carrying amount of intangible assets | 8,146 | 8,146 | |
Accumulated amortization on intangible assets | 6,515 | 5,810 | |
Trade Name | |||
Finite-Lived Intangible Assets | |||
Gross carrying amount of intangible assets | 203 | 203 | |
Accumulated amortization on intangible assets | 149 | 128 | |
Asset Management And Retirement Plan Services | |||
Finite-Lived Intangible Assets | |||
Accumulated amortization on intangible assets | $ 480 | $ 324 |
Intangible assets, net - Summar
Intangible assets, net - Summary of Estimated Amortization Expense on Intangible Assets (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Intangible assets, net | |
2019 | $ 730 |
2020 | 606 |
2021 | 491 |
2022 | 363 |
2023 | 106 |
Total | $ 2,296 |
Other assets - Components of Ot
Other assets - Components of Other Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Other assets. | ||
Other real estate owned | $ 376 | $ 284 |
Investment in low income housing partnership | 7,377 | 7,842 |
Mortgage servicing rights | 718 | 728 |
Bank owned life insurance | 34,288 | 33,836 |
Restricted equity securities | 7,462 | 8,562 |
Net deferred tax asset | 5,081 | 3,906 |
Other assets | 8,435 | 9,311 |
Total | $ 63,737 | $ 64,469 |
Other assets - Unpaid Principal
Other assets - Unpaid Principal Balances (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Other assets. | ||
Unpaid principal balances of mortgage loans serviced for others | $ 165,610 | $ 174,017 |
Deposits - Components of Intere
Deposits - Components of Interest-bearing and Noninterest-bearing Deposits (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Deposits. | ||
Money market accounts | $ 328,949 | $ 278,494 |
Now accounts | 421,414 | 389,734 |
Savings accounts | 378,157 | 387,827 |
Time deposits less than $100 | 250,456 | 220,812 |
Time deposits $100 or more | 85,786 | 61,422 |
Total interest-bearing deposits | 1,464,762 | 1,338,289 |
Noninterest-bearing deposits | 410,260 | 380,729 |
Total deposits | $ 1,875,022 | $ 1,719,018 |
Deposits - Schedule of Maturiti
Deposits - Schedule of Maturities of Time Deposits (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Deposits. | |
2019 | $ 154,506 |
2020 | 52,824 |
2021 | 83,959 |
2022 | 12,895 |
2023 | 19,438 |
Thereafter | 12,620 |
Total | $ 336,242 |
Deposits - Additional Informati
Deposits - Additional Information (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Deposits. | ||
Aggregate amount of deposits reclassified as loans | $ 343 | $ 298 |
Short-term borrowings - Additio
Short-term borrowings - Additional Information (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Short-term Debt | ||
Maximum borrowing capacity | $ 18,000 | $ 18,000 |
Outstanding amount in borrowings | 0 | $ 0 |
Peoples Bank | ||
Short-term Debt | ||
Maximum borrowing capacity | 700,169 | |
Outstanding amount in borrowings | 124,406 | |
Amount of credit facility used to issue standby letters of credit to collateralize public fund deposits | $ 171,970 |
Short-term borrowings - Summary
Short-term borrowings - Summary of Short-term Borrowings (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Short-term Debt | |||
Ending Balance | $ 86,500 | $ 123,675 | |
FHLB advances | |||
Short-term Debt | |||
Ending Balance | 86,500 | 123,675 | $ 82,700 |
Average Balance | 133,834 | 76,846 | 67,553 |
Maximum Month-End Balance | $ 189,275 | $ 123,675 | $ 86,300 |
Weighted Average Rate for | 2.05% | 1.17% | 0.60% |
Weighted Average Rate at | 2.62% | 1.54% | 0.74% |
Long-term debt - Schedule of Lo
Long-term debt - Schedule of Long-term Debt Consisting of Advances (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Debt Instrument | ||
Long-term debt | $ 37,906 | $ 49,734 |
February 2017 | ||
Debt Instrument | ||
Fixed interest rate (as a percent) | 3.83% | |
Long-term debt | $ 40 | |
September 2017 | ||
Debt Instrument | ||
Fixed interest rate (as a percent) | 1.27% | |
Long-term debt | $ 10,000 | |
April 2018 | ||
Debt Instrument | ||
Adjustable interest rate (as a percent) | 4.28% | |
Long-term debt | $ 3,000 | 3,000 |
December 2018 | ||
Debt Instrument | ||
Adjustable interest rate (as a percent) | 4.01% | |
Long-term debt | $ 6,300 | 6,300 |
December 2019 | ||
Debt Instrument | ||
Fixed interest rate (as a percent) | 1.62% | |
Long-term debt | $ 10,000 | 10,000 |
December 2019 | ||
Debt Instrument | ||
Fixed interest rate (as a percent) | 1.74% | |
Long-term debt | $ 5,000 | 5,000 |
December 2019 | ||
Debt Instrument | ||
Fixed interest rate (as a percent) | 1.84% | |
Long-term debt | $ 5,000 | 5,000 |
June 2020 | ||
Debt Instrument | ||
Fixed interest rate (as a percent) | 4.69% | |
Long-term debt | $ 8,606 | $ 10,394 |
Long-term debt - Schedule of Ma
Long-term debt - Schedule of Maturities of Long-term Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Long-term debt. | ||
2019 | $ 21,174 | |
2020 | 11,963 | |
2021 | 2,058 | |
2022 | 2,156 | |
2023 | 555 | |
Total long-term debt | $ 37,906 | $ 49,734 |
Long-term debt - Additional Inf
Long-term debt - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Debt Instrument | ||
Long-term debt at fixed rates | $ 28,606 | |
Long-term debt at adjustable rates | $ 9,300 | |
Interest rate description | three-month Libor plus 1.21% to plus 1.57% | |
FHLB long-term advances | $ 0 | $ 0 |
Minimum | ||
Debt Instrument | ||
Interest rate (as a percent) | 1.21% | |
Maximum | ||
Debt Instrument | ||
Interest rate (as a percent) | 1.57% |
Fair value of financial instr_3
Fair value of financial instruments - Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - Recurring Basis - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | $ 270,496 | $ 272,470 |
U.S. Treasuries | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | 25,592 | 19,814 |
U.S. Government-sponsored enterprises state and municipals | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | 92,818 | 93,648 |
State and Municipals, Taxable | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | 13,853 | 15,047 |
State and Municipals, Tax-exempt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | 85,954 | 103,833 |
Mortgage-backed Securities, U.S. Government agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | 12,629 | 14,434 |
Mortgage-backed Securities, U.S. Government-sponsored enterprises | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | 38,836 | 25,726 |
Common equity securities. | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | 291 | 46 |
Interest rate floor - other assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | 553 | |
Interest rate swap-other assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | 108 | 655 |
Interest rate swap-other liabilities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Liabilities measured at fair value | (138) | (733) |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | 25,883 | 19,860 |
Level 1 | U.S. Treasuries | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | 25,592 | 19,814 |
Level 1 | Common equity securities. | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | 291 | 46 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | 244,613 | 252,610 |
Level 2 | U.S. Government-sponsored enterprises state and municipals | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | 92,818 | 93,648 |
Level 2 | State and Municipals, Taxable | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | 13,853 | 15,047 |
Level 2 | State and Municipals, Tax-exempt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | 85,954 | 103,833 |
Level 2 | Mortgage-backed Securities, U.S. Government agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | 12,629 | 14,434 |
Level 2 | Mortgage-backed Securities, U.S. Government-sponsored enterprises | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | 38,836 | 25,726 |
Level 2 | Interest rate floor - other assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | 553 | |
Level 2 | Interest rate swap-other assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | 108 | 655 |
Level 2 | Interest rate swap-other liabilities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Liabilities measured at fair value | $ (138) | (733) |
Level 3 | Common equity securities. | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | ||
Level 3 | Interest rate swap-other assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets, Fair Value Estimate | ||
Level 3 | Interest rate swap-other liabilities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Liabilities measured at fair value |
Fair value of financial instr_4
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, 2018 | Dec. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Impaired loans | $ 2,809 | $ 3,424 |
Other real estate owned | 234 | 216 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Impaired loans | 2,809 | 3,424 |
Other real estate owned | $ 234 | $ 216 |
Fair value of financial instr_5
Fair value of financial instruments - Additional Quantitative Information about Assets Measured at Fair Value on Nonrecurring Basis (Details) - Nonrecurring Basis - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Other real estate owned | ||
Fair Value Inputs, Assets, Quantitative Information | ||
Range and weighted average of appraisal adjustments | 38.90% | 30.70% |
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 | 26.00% | 25.00% |
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 | 73.30% | 41.30% |
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 | 61.80% | 67.20% |
Range and weighted average of liquidation expenses | 4.40% | 4.90% |
Impaired loans | Minimum | ||
Fair Value Inputs, Assets, Quantitative Information | ||
Range and weighted average of appraisal adjustments | 7.10% | 4.00% |
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 | $ 234 | $ 216 |
Level 3 | Impaired loans | ||
Fair Value Inputs, Assets, Quantitative Information | ||
Assets, Fair Value Estimate | $ 2,809 | $ 3,424 |
Fair value of financial instr_6
Fair value of financial instruments - Carrying and Fair Values of Financial Instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Investment securities: | ||
Available-for-sale | $ 269,682 | $ 272,502 |
Common equity securities | 291 | 46 |
Held-to-maturity | 8,380 | 9,547 |
Loans held for sale | 749 | 106 |
Mortgage servicing rights | 718 | 728 |
Other assets | 63,737 | 64,469 |
Carrying Value | ||
Financial assets: | ||
Cash and cash equivalents | 32,616 | 37,488 |
Investment securities: | ||
Available-for-sale | 269,682 | 272,548 |
Common equity securities | 291 | |
Held-to-maturity | 8,361 | 9,274 |
Loans held for sale | 749 | 106 |
Net loans | 1,801,887 | 1,674,105 |
Accrued interest receivable | 7,115 | 6,936 |
Mortgage servicing rights | 718 | 728 |
Restricted equity securities | 7,462 | 8,562 |
Interest rate floor | 553 | |
Interest rate swaps | 108 | 655 |
Total assets | 2,129,542 | 2,010,402 |
Financial liabilities: | ||
Deposits | 1,875,022 | 1,719,018 |
Short-term borrowings | 86,500 | 123,675 |
Long-term debt | 37,906 | 49,734 |
Accrued interest payable | 1,195 | 497 |
Interest rate swap | 138 | 733 |
Total liabilities | 2,000,761 | 1,893,657 |
Fair Value | ||
Financial assets: | ||
Cash and cash equivalents | 32,616 | 37,488 |
Investment securities: | ||
Available-for-sale | 269,682 | 272,548 |
Common equity securities | 291 | |
Held-to-maturity | 8,380 | 9,547 |
Loans held for sale | 749 | 106 |
Net loans | 1,762,449 | 1,645,292 |
Accrued interest receivable | 7,115 | 6,936 |
Mortgage servicing rights | 1,710 | 1,638 |
Restricted equity securities | 7,462 | 8,562 |
Interest rate floor | 553 | |
Interest rate swaps | 108 | 655 |
Total assets | 2,091,115 | 1,982,772 |
Financial liabilities: | ||
Deposits | 1,874,520 | 1,666,284 |
Short-term borrowings | 86,500 | 123,675 |
Long-term debt | 38,071 | 50,147 |
Accrued interest payable | 1,195 | 497 |
Interest rate swap | 138 | 733 |
Total liabilities | 2,000,424 | 1,841,336 |
Level 1 | ||
Financial assets: | ||
Cash and cash equivalents | 32,616 | 37,488 |
Investment securities: | ||
Available-for-sale | 25,592 | 19,860 |
Common equity securities | 291 | |
Level 2 | ||
Investment securities: | ||
Available-for-sale | 244,090 | 252,688 |
Held-to-maturity | 8,380 | 9,547 |
Loans held for sale | 749 | 106 |
Accrued interest receivable | 7,115 | 6,936 |
Mortgage servicing rights | 1,710 | 1,638 |
Restricted equity securities | 7,462 | 8,562 |
Interest rate floor | 553 | |
Interest rate swaps | 108 | 655 |
Financial liabilities: | ||
Deposits | 1,874,520 | 1,666,284 |
Short-term borrowings | 86,500 | 123,675 |
Long-term debt | 38,071 | 50,147 |
Accrued interest payable | 1,195 | 497 |
Interest rate swap | 138 | 733 |
Level 3 | ||
Investment securities: | ||
Net loans | $ 1,762,449 | $ 1,645,292 |
Derivatives and hedging activ_3
Derivatives and hedging activities - Fair Values of Derivative Instruments on the Balance Sheet (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($)security | Dec. 31, 2017USD ($) | |
Derivatives, Fair Value | |||
Asset Derivatives | $ 661 | $ 655 | |
Liability Derivatives | 138 | 733 | |
Interest Receivable | 7,115 | 6,936 | |
Interest Payable | 1,195 | 497 | |
Interest income | |||
Derivatives, Fair Value | |||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net | $ 13 | ||
Interest Rate Swaps | |||
Derivatives, Fair Value | |||
Number of instruments held | security | 12 | ||
Derivatives designated as hedging instruments | |||
Derivatives, Fair Value | |||
Asset Derivatives | $ 553 | ||
Derivatives designated as hedging instruments | Interest Rate Floor | |||
Derivatives, Fair Value | |||
Notional amount | 25,000 | ||
Derivatives designated as hedging instruments | Interest Rate Floor | Other Assets. | |||
Derivatives, Fair Value | |||
Asset Derivatives | 553 | ||
Derivatives not designated as hedging instruments | |||
Derivatives, Fair Value | |||
Asset Derivatives | 108 | 655 | |
Liability Derivatives | 138 | 733 | |
Derivatives not designated as hedging instruments | Interest Rate Swaps | |||
Derivatives, Fair Value | |||
Notional amount | 62,071 | ||
Interest Receivable | 28 | ||
Interest Payable | 28 | ||
Derivatives not designated as hedging instruments | Interest Rate Swaps | Other Assets. | |||
Derivatives, Fair Value | |||
Asset Derivatives | 108 | 655 | |
Derivatives not designated as hedging instruments | Interest Rate Swaps | Other Liabilities. | |||
Derivatives, Fair Value | |||
Liability Derivatives | $ 138 | $ 733 | |
Forecast | Cash Flow Hedge | Interest Rate Floor | Interest income | |||
Derivatives, Fair Value | |||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net | $ 64 |
Derivatives and hedging activ_4
Derivatives and hedging activities - Effect of Fair Value and Cash Flow Hedge Accounting on Accumulated Other Comprehensive Income (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Amount of Loss Recognized in OCI on Derivative | $ 243 |
Amount of Gain Recognized in OCI Included Component | 109 |
Amount of Gain Recognized in OCI Excluded Component | 134 |
Amount of Loss Reclassified from Accumulated OCI into Income | (3) |
Amount of Gain Reclassified from Accumulated OCI into Income Included Component | 13 |
Amount of Loss Reclassified from Accumulated OCI into Income Excluded Component | (16) |
Interest income | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Amount of Loss Reclassified from Accumulated OCI into Income | (3) |
Cash Flow Hedge | Interest Rate Floor | Interest income | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Amount of Loss Recognized in OCI on Derivative | 243 |
Amount of Gain Recognized in OCI Included Component | 109 |
Amount of Gain Recognized in OCI Excluded Component | 134 |
Amount of Loss Reclassified from Accumulated OCI into Income | (3) |
Amount of Gain Reclassified from Accumulated OCI into Income Included Component | 13 |
Amount of Loss Reclassified from Accumulated OCI into Income Excluded Component | $ (16) |
Derivatives and hedging activ_5
Derivatives and hedging activities - Effect of Fair Value and Cash Flow Hedge Accounting on the Income Statement (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Derivative Instruments, Gain (Loss) | |
Total amounts of income and expense line items presented in the statement of financial performance in which the effects of fair value or cash flow hedges are recorded | $ 246 |
Amount of gain or (loss) reclassified from accumulated other comprehensive income into income | (3) |
Interest income | |
Derivative Instruments, Gain (Loss) | |
Total amounts of income and expense line items presented in the statement of financial performance in which the effects of fair value or cash flow hedges are recorded | (3) |
Amount of gain or (loss) reclassified from accumulated other comprehensive income into income | (3) |
Amount of gain or (loss) reclassified from accumulated other comprehensive income into income - included component | 13 |
Amount of gain or (loss) reclassified from accumulated other comprehensive income into income - excluded component | $ (16) |
Derivatives and hedging activ_6
Derivatives and hedging activities - Effect of Other Derivative Instruments on the Income Statement (Details) - Derivatives not designated as hedging instruments - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Interest Rate Swaps | Other non-interest income | ||
Derivative Instruments, Gain (Loss) | ||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | $ 49 | $ (79) |
Fee Income | Other income/(expense) | ||
Derivative Instruments, Gain (Loss) | ||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | $ 53 | $ 792 |
Derivatives and hedging activ_7
Derivatives and hedging activities - Offsetting Derivatives (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Offsetting of Derivative Assets | ||
Gross Amounts of Recognized Assets | $ 661 | $ 655 |
Net Amounts of Assets presented in the Statement of Financial Position | 661 | 655 |
Net Amount | 661 | 655 |
Offsetting of Derivative Liabilities | ||
Gross Amounts of Recognized Liabilities | 138 | 733 |
Net Amounts of Assets presented in the Statement of Financial Position | 138 | 733 |
Net Amount | $ 138 | $ 733 |
Derivatives and hedging activ_8
Derivatives and hedging activities - Credit-risk-related Contingent Features (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Derivatives and hedging activities | |
Termination value of derivatives in a net liability position | $ 29 |
Stock plans - Additional Inform
Stock plans - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Shares or units awarded | 2,548 | 2,362 | ||
Unrecognized compensation expense | $ 92 | $ 32 | ||
2008 Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Share based compensation expense | 156 | $ 71 | ||
2017 Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Common stock available for grant as awards | 86,994 | |||
Share based compensation expense | $ 272 | $ 21 | ||
Non-Performance-based restricted stock | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Shares or units vesting period | 3 years | |||
Non-Performance-based restricted stock | 2008 Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Shares or units awarded | 2,362 | |||
Vested shares | 2,493 | |||
Non-Performance-based restricted stock | 2017 Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Shares or units awarded | 2,548 | |||
Vested shares | 114 | |||
Performance-based restricted stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Shares or units vesting period | 3 years | |||
Cumulative diluted earnings per share period used for conditions for vesting of performance-based restricted stock units | 3 years | |||
Average return on equity period used for conditions for vesting of performance-based restricted stock units | 3 years | |||
Performance-based restricted stock units | 2008 Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Number of nonvested restricted stock awards | 8,266 | |||
Performance-based restricted stock units | 2017 Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Number of nonvested restricted stock awards | 8,920 | |||
Restricted Stock | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Vested shares | 2,607 | 10,542 | 1,947 | |
Number of nonvested restricted stock awards | 21,309 | 12,448 | 12,362 | 14,309 |
Shares or units cliff vesting period | 5 years | |||
Unrecognized compensation expense | $ 525 | |||
Weighted average vesting period | 1 year 8 months 12 days | |||
Stock appreciation rights granted | 11,468 | 10,628 | ||
Restricted Stock | 2008 Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Vested shares | 10,542 |
Stock plans - Schedule of Activ
Stock plans - Schedule of Activity Related to Restricted Stock (Details) - Restricted Stock - shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award | |||
Nonvested, January 1 | 12,448 | 12,362 | 14,309 |
Granted shares | 11,468 | 10,628 | |
Vested shares | 2,607 | 10,542 | 1,947 |
Nonvested, December 31 | 21,309 | 12,448 | 12,362 |
Employee benefit plans - Salari
Employee benefit plans - Salaries and Employee Benefits Expense - ESOP (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Peoples Security Bank and Trust ESOP | |||
Peoples Security Bank and Trust ESOP | |||
Contribution to ESOP | $ 197 | $ 185 | $ 156 |
Employee benefit plans - Sala_2
Employee benefit plans - Salaries and Employee Benefits Expense - Profit Sharing (Details) - Retirement Profit Sharing Plan - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Profit Sharing plan | |||
Company contribution | $ 1,047 | $ 923 | $ 786 |
Safe harbor contribution | 578 | 509 | 446 |
Discretionary contributions | $ 469 | $ 414 | $ 340 |
Employee benefit plans - Sala_3
Employee benefit plans - Salaries and Employee Benefits Expense - SERP and Employee Pension Plan (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 22, 2008 | |
Supplemental Executive Retirement Plans (“SERP”) | ||||
Defined Benefit Plan Disclosure | ||||
Maximum annual benefit in excess of federal limits (as a percent) | 6.00% | |||
Employee benefit plan liability | $ 116 | $ 96 | ||
Employee benefit plan expense | 20 | 20 | $ 13 | |
Defined benefit plan accrued liabilities | 1,845 | 1,594 | ||
Salaries and employee benefits expense | $ 335 | 314 | $ 254 | |
Pension Benefits | ||||
Defined Benefit Plan Disclosure | ||||
Retirement age period for fixed benefits payable | 65 years | |||
Benefits accrued under employees' pension plan | $ 0 | |||
Increase (decrease) in accumulated benefit obligation | $ 546 | $ (395) |
Employee benefit plans - Summar
Employee benefit plans - Summary of Pension and Postretirement Life Insurance Plans (Details) - Pension Benefits - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Change in benefit obligation: | |||
Benefit obligation, beginning | $ 16,935 | $ 16,703 | |
Interest cost | 623 | 650 | $ 665 |
Change in experience gain | 135 | (13) | |
Change in actuarial assumptions loss (gain) | (546) | 395 | |
Benefits paid | (809) | (800) | |
Benefit obligation, ending | 16,338 | 16,935 | 16,703 |
Change in plan assets: | |||
Fair value of plan assets, beginning | 13,264 | 12,644 | |
Actual return on plan assets | (236) | 1,420 | |
Employer contributions | 2,700 | ||
Benefits paid | (809) | (800) | |
Fair value of plan assets, ending | 14,919 | 13,264 | $ 12,644 |
Funded status at end of year | $ (1,419) | $ (3,671) |
Employee benefit plans - Schedu
Employee benefit plans - Schedule of Amounts Recognized in Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Amounts recognized in the accumulated other comprehensive loss consist of: | ||
Net amount recognized | $ 5,702 | $ 5,236 |
Pension Benefits | ||
Defined Benefit Plan Disclosure | ||
Liabilities | 1,419 | 3,671 |
Amounts recognized in the accumulated other comprehensive loss consist of: | ||
Net actuarial gain | (7,218) | (6,628) |
Deferred taxes | 1,516 | 1,392 |
Net amount recognized | $ (5,702) | $ (5,236) |
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, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Changes in plan assets and benefit obligations recognized in other comprehensive income (loss): | |||
Net loss (gain) | $ 7,218 | $ 6,628 | |
Pension Benefits | |||
Net periodic pension cost: | |||
Interest cost | 623 | 650 | $ 665 |
Expected return on plan assets | (960) | (915) | (893) |
Amortization of unrecognized net gain | 194 | 195 | 209 |
Net periodic pension cost | (143) | (70) | (19) |
Changes in plan assets and benefit obligations recognized in other comprehensive income (loss): | |||
Net loss (gain) | (590) | 318 | 917 |
Deferred tax | 124 | (67) | (321) |
Total recognized in other comprehensive loss | (466) | 251 | 596 |
Total recognized in net period pension cost and other comprehensive loss | (609) | $ 181 | $ 577 |
Estimated net loss for defined benefit pension plan that will be amortized from accumulated other comprehensive loss into net periodic benefit cost over next fiscal year | $ 223 |
Employee benefit plans - Sche_2
Employee benefit plans - Schedule of Weighted-Average Assumptions Used to Determine Benefit Obligations and Related Expenses (Details) - Pension Benefits | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Defined Benefit Plan Disclosure | |||
Discount rate, Obligation | 3.75% | 4.00% | 4.00% |
Discount rate, Expense | 4.00% | 3.75% | 4.00% |
Expected long-term return on plan assets | 7.50% | 7.50% | 7.50% |
Employee benefit plans - Sche_3
Employee benefit plans - Schedule of Pension Plan Weighted-Average Asset Allocations (Details) - Pension Benefits | Dec. 31, 2018 | Dec. 31, 2017 |
Defined Benefit Plan Disclosure | ||
Weighted-average asset allocations | 100.00% | 100.00% |
Cash and cash equivalents | ||
Defined Benefit Plan Disclosure | ||
Weighted-average asset allocations | 5.00% | 4.10% |
Equity securities | ||
Defined Benefit Plan Disclosure | ||
Weighted-average asset allocations | 56.20% | 57.40% |
Corporate bonds | ||
Defined Benefit Plan Disclosure | ||
Weighted-average asset allocations | 23.60% | 27.60% |
U.S. Treasuries and Government agencies | ||
Defined Benefit Plan Disclosure | ||
Weighted-average asset allocations | 15.20% | 10.90% |
Employee benefit plans - Fair V
Employee benefit plans - Fair Value Measurement of Pension Plan Assets (Details) - Pension Benefits - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Defined Benefit Plan Disclosure | |||
Fair value of pension plan assets | $ 14,919 | $ 13,264 | $ 12,644 |
Cash | |||
Defined Benefit Plan Disclosure | |||
Fair value of pension plan assets | 743 | 539 | |
U.S. large cap | |||
Defined Benefit Plan Disclosure | |||
Fair value of pension plan assets | 7,687 | 7,269 | |
International | |||
Defined Benefit Plan Disclosure | |||
Fair value of pension plan assets | 694 | 350 | |
U.S. Treasuries | |||
Defined Benefit Plan Disclosure | |||
Fair value of pension plan assets | 192 | 198 | |
U.S. Government agencies | |||
Defined Benefit Plan Disclosure | |||
Fair value of pension plan assets | 2,085 | 1,247 | |
Corporate bonds | |||
Defined Benefit Plan Disclosure | |||
Fair value of pension plan assets | 3,518 | 3,661 | |
Level 1 | |||
Defined Benefit Plan Disclosure | |||
Fair value of pension plan assets | 9,124 | 8,158 | |
Level 1 | Cash | |||
Defined Benefit Plan Disclosure | |||
Fair value of pension plan assets | 743 | 539 | |
Level 1 | U.S. large cap | |||
Defined Benefit Plan Disclosure | |||
Fair value of pension plan assets | 7,687 | 7,269 | |
Level 1 | International | |||
Defined Benefit Plan Disclosure | |||
Fair value of pension plan assets | 694 | 350 | |
Level 2 | |||
Defined Benefit Plan Disclosure | |||
Fair value of pension plan assets | 5,795 | 5,106 | |
Level 2 | U.S. Treasuries | |||
Defined Benefit Plan Disclosure | |||
Fair value of pension plan assets | 192 | 198 | |
Level 2 | U.S. Government agencies | |||
Defined Benefit Plan Disclosure | |||
Fair value of pension plan assets | 2,085 | 1,247 | |
Level 2 | Corporate bonds | |||
Defined Benefit Plan Disclosure | |||
Fair value of pension plan assets | $ 3,518 | $ 3,661 |
Employee benefit plans - Sala_4
Employee benefit plans - Salaries and Employee Benefits Expense - Investment Percentages (Details) - Pension Benefits - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Defined Benefit Plan Disclosure | ||
Amount of company's common stock included in equity securities | $ 0 | $ 0 |
Industry sector | Maximum | ||
Defined Benefit Plan Disclosure | ||
Maximum diversification (as a percent) | 20.00% | |
Common equity securities. | ||
Defined Benefit Plan Disclosure | ||
Maximum diversification (as a percent) | 10.00% | |
Cash equivalents | ||
Defined Benefit Plan Disclosure | ||
Defined benefit plan, target allocation (as a percent) | 10.00% | |
Fixed income | ||
Defined Benefit Plan Disclosure | ||
Defined benefit plan, target allocation (as a percent) | 40.00% | |
Equities | ||
Defined Benefit Plan Disclosure | ||
Defined benefit plan, target allocation (as a percent) | 50.00% |
Employee benefit plans - Sche_4
Employee benefit plans - Schedule of Benefit Payments Expected to be Paid (Details) - Pension Benefits $ in Thousands | Dec. 31, 2018USD ($) |
Defined Benefit Plan Disclosure | |
2019 | $ 843 |
2020 | 857 |
2021 | 858 |
2022 | 896 |
2023 | 912 |
Thereafter | $ 5,028 |
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, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Current | $ 4,072 | $ 6,515 | $ 6,450 | ||||||||
Deferred | (681) | 1,665 | (1,442) | ||||||||
Total income tax expense (benefit) | $ 904 | $ 902 | $ 811 | $ 774 | $ 3,971 | $ 1,287 | $ 1,653 | $ 1,269 | 3,391 | 8,180 | 5,008 |
Peoples Bank | |||||||||||
Total income tax expense (benefit) | $ (27) | $ (54) | $ (75) |
Income taxes - Components of Ne
Income taxes - Components of Net Deferred Tax Asset (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Deferred tax assets: | ||
Allowance for loan losses | $ 4,490 | $ 3,981 |
Defined benefit plan | 1,516 | 1,392 |
Deferred compensation | 593 | 499 |
Deferred loan fees | 470 | 264 |
Investment securities available-for-sale | 683 | 260 |
Other | 116 | 106 |
Total | 7,868 | 6,502 |
Deferred tax liabilities: | ||
Premises and equipment, net | 985 | 815 |
Merger related accounting | 1,083 | 1,243 |
Deferred loan costs | 626 | 531 |
Other | 93 | 7 |
Total | 2,787 | 2,596 |
Net deferred tax asset | $ 5,081 | $ 3,906 |
Income taxes (Details)
Income taxes (Details) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income taxes | |||
Federal statutory rate | 21.00% | 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, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Federal income tax at statutory rate | $ 5,945 | $ 9,323 | $ 8,607 | ||||||||
Federal income tax related to tax reform legislation | 2,623 | ||||||||||
Tax exempt interest | (1,320) | (2,157) | (2,264) | ||||||||
Bank owned life insurance income | (236) | (269) | (277) | ||||||||
Residential housing program tax credits | (1,094) | (1,095) | (1,128) | ||||||||
Other, net | 96 | (245) | 70 | ||||||||
Total income tax expense (benefit) | $ 904 | $ 902 | $ 811 | $ 774 | $ 3,971 | $ 1,287 | $ 1,653 | $ 1,269 | 3,391 | 8,180 | 5,008 |
Peoples Bank | |||||||||||
Total income tax expense (benefit) | $ (27) | $ (54) | $ (75) |
Parent Company financial stat_3
Parent Company financial statements - Condensed Balance Sheets (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Assets: | ||||
Cash and cash equivalents | $ 32,616 | $ 37,488 | $ 39,941 | $ 32,917 |
Investment securities available-for-sale | 269,682 | 272,502 | ||
Other assets | 63,737 | 64,469 | ||
Total assets | 2,288,993 | 2,169,031 | ||
Liabilities and Stockholders' Equity: | ||||
Other liabilities | 9,756 | 11,131 | ||
Stockholders' equity | 278,614 | 264,976 | 256,618 | 248,768 |
Total liabilities and stockholders’ equity | 2,288,993 | 2,169,031 | ||
Peoples Bank | ||||
Assets: | ||||
Cash and cash equivalents | 3,736 | 3,932 | $ 3,948 | $ 4,119 |
Investment securities available-for-sale | 291 | 46 | ||
Investment in bank subsidiary | 272,617 | 259,147 | ||
Due from subsidiaries | 1,974 | 1,900 | ||
Other assets | 35 | |||
Total assets | 278,653 | 265,025 | ||
Liabilities and Stockholders' Equity: | ||||
Other liabilities | 39 | 49 | ||
Stockholders' equity | 278,614 | 264,976 | ||
Total liabilities and stockholders’ equity | $ 278,653 | $ 265,025 |
Parent Company financial stat_4
Parent Company financial statements - Condensed Statements of Income and Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Interest income: | |||||||||||
Dividends from subsidiaries | $ 72 | $ 52 | $ 48 | ||||||||
Unrealized holding gains on equity securities | 14 | 623 | |||||||||
Expense: | |||||||||||
Income before income taxes | $ 7,296 | $ 7,619 | $ 6,768 | $ 6,628 | $ 6,619 | $ 6,637 | $ 7,312 | $ 6,069 | |||
Income tax expense (benefit) | 904 | 902 | 811 | 774 | 3,971 | 1,287 | 1,653 | 1,269 | 3,391 | 8,180 | 5,008 |
Net income | $ 6,392 | $ 6,717 | $ 5,957 | $ 5,854 | $ 2,648 | $ 5,350 | $ 5,659 | $ 4,800 | 24,920 | 18,457 | 19,583 |
Comprehensive Income | 23,648 | 17,500 | 17,553 | ||||||||
Peoples Bank | |||||||||||
Interest income: | |||||||||||
Dividends from subsidiaries | 9,691 | 9,319 | 9,170 | ||||||||
Other income | 72 | 52 | 46 | ||||||||
Unrealized holding gains on equity securities | 13 | ||||||||||
Total income | 9,776 | 9,371 | 9,216 | ||||||||
Expense: | |||||||||||
Other expenses | 214 | 205 | 259 | ||||||||
Total expenses | 214 | 205 | 259 | ||||||||
Income before income taxes | 9,562 | 9,166 | 8,957 | ||||||||
Income tax expense (benefit) | (27) | (54) | (75) | ||||||||
Income before undistributed income of subsidiaries | 9,589 | 9,220 | 9,032 | ||||||||
Equity in undistributed net income of subsidiaries | 15,331 | 9,237 | 10,551 | ||||||||
Net income | 24,920 | 18,457 | 19,583 | ||||||||
Comprehensive Income | $ 23,523 | $ 17,500 | $ 17,553 |
Parent Company financial stat_5
Parent Company financial statements - Condensed Statements of Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flows from operating activities: | |||||||||||
Net income | $ 6,392 | $ 6,717 | $ 5,957 | $ 5,854 | $ 2,648 | $ 5,350 | $ 5,659 | $ 4,800 | $ 24,920 | $ 18,457 | $ 19,583 |
Adjustments: | |||||||||||
(Decrease) increase in other assets | 816 | 2,023 | 1,373 | ||||||||
Decrease in other liabilities | (1,736) | (1,817) | (2,470) | ||||||||
Stock based compensation | 272 | 177 | 71 | ||||||||
Net cash provided by operating activities | 32,626 | 28,593 | 28,053 | ||||||||
Cash flows from investing activities: | |||||||||||
Purchase of available-for-sale securities | (32,709) | (73,471) | (62,022) | ||||||||
Net cash used in investing activities | (134,806) | (184,563) | (186,357) | ||||||||
Cash flows from financing activities: | |||||||||||
Redemption of common stock | (604) | ||||||||||
Net cash provided by (used in) financing activities | 97,308 | 153,517 | 165,328 | ||||||||
Decrease in cash | (4,872) | (2,453) | 7,024 | ||||||||
Cash and cash equivalents at beginning of period | 37,488 | 39,941 | 37,488 | 39,941 | 32,917 | ||||||
Cash and cash equivalents at end of period | 32,616 | 37,488 | 32,616 | 37,488 | 39,941 | ||||||
Peoples Bank | |||||||||||
Cash flows from operating activities: | |||||||||||
Net income | 24,920 | 18,457 | 19,583 | ||||||||
Adjustments: | |||||||||||
Net gains on investment securities | (14) | ||||||||||
Undistributed net income of subsidiaries | (15,331) | (9,237) | (15,331) | (9,237) | (10,551) | ||||||
(Decrease) increase in other assets | (111) | (3) | 577 | ||||||||
Decrease in other liabilities | (10) | (53) | (77) | ||||||||
Stock based compensation | 272 | 177 | 71 | ||||||||
Net cash provided by operating activities | 9,726 | 9,341 | 9,603 | ||||||||
Cash flows from investing activities: | |||||||||||
Purchase of available-for-sale securities | (234) | (43) | |||||||||
Cash flows from financing activities: | |||||||||||
Redemption of common stock | (604) | ||||||||||
Reissuance of treasury stock | 5 | 5 | |||||||||
Cash dividends paid | (9,693) | (9,319) | (9,170) | ||||||||
Net cash provided by (used in) financing activities | (9,688) | (9,314) | (9,774) | ||||||||
Decrease in cash | (196) | (16) | (171) | ||||||||
Cash and cash equivalents at beginning of period | $ 3,932 | $ 3,948 | 3,932 | 3,948 | 4,119 | ||||||
Cash and cash equivalents at end of period | $ 3,736 | $ 3,932 | $ 3,736 | $ 3,932 | $ 3,948 |
Regulatory matters - Additional
Regulatory matters - Additional Information (Details) - USD ($) | Jan. 01, 2016 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Schedule of Capitalization | |||||
Capital stock (as a percent) | 100.00% | ||||
Period over which the Company may only declare and pay dividends out of accumulated net earnings, including accumulated net earnings acquired as a result of a merger | 7 years | ||||
Funds available for transfers | $ 23,778,000 | ||||
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 | |||||
Net earnings which must set aside as a surplus (as a percent) | 10.00% | ||||
Capital conservation buffer | 0.625% | ||||
Minimum | |||||
Schedule of Capitalization | |||||
Net earnings to surplus funds (as a percent) | 10.00% |
Regulatory matters - Schedule o
Regulatory matters - Schedule of Bank's Capital Amounts and Ratios (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Consolidated | ||
Common equity Tier 1 capital to risk-weighted assets | ||
Common equity Tier 1 capital to risk-weighted assets, Actual Amount | $ 221,024 | $ 205,222 |
Common equity Tier 1 capital to risk-weighted assets, Actual Ratio | 11.95% | 11.85% |
Common equity Tier 1 capital to risk-weighted assets, Minimum For Capital Adequacy Purposes Amount | $ 83,241 | $ 77,930 |
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 | $ 221,024 | $ 205,222 |
Tier 1 capital to risk-weighted assets, Actual Ratio | 11.95% | 11.85% |
Tier 1 capital to risk-weighted assets, Minimum For Capital Adequacy Purposes Amount | $ 110,988 | $ 103,906 |
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 | $ 242,403 | $ 224,182 |
Total capital to risk-weighted assets, Actual Ratio | 13.10% | 12.95% |
Total capital to risk-weighted assets, Minimum For Capital Adequacy Purposes Amount | $ 147,984 | $ 138,542 |
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 | $ 221,024 | $ 205,222 |
Tier 1 capital to average assets, Actual Ratio | 10.03% | 9.94% |
Tier 1 capital to average assets, Minimum For Capital Adequacy Purposes Amount | $ 88,119 | $ 82,564 |
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 | $ 215,027 | $ 199,450 |
Common equity Tier 1 capital to risk-weighted assets, Actual Ratio | 11.64% | 11.53% |
Common equity Tier 1 capital to risk-weighted assets, Minimum For Capital Adequacy Purposes Amount | $ 83,144 | $ 77,843 |
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 | $ 120,097 | $ 112,440 |
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 | $ 215,027 | $ 199,450 |
Tier 1 capital to risk-weighted assets, Actual Ratio | 11.64% | 11.53% |
Tier 1 capital to risk-weighted assets, Minimum For Capital Adequacy Purposes Amount | $ 110,859 | $ 103,791 |
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 | $ 147,811 | $ 138,388 |
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 | $ 236,406 | $ 218,410 |
Total capital to risk-weighted assets, Actual Ratio | 12.80% | 12.63% |
Total capital to risk-weighted assets, Minimum For Capital Adequacy Purposes Amount | $ 147,811 | $ 138,388 |
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 | $ 184,764 | $ 172,985 |
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 | $ 215,027 | $ 199,450 |
Tier 1 capital to average assets, Actual Ratio | 9.78% | 9.68% |
Tier 1 capital to average assets, Minimum For Capital Adequacy Purposes Amount | $ 87,969 | $ 82,406 |
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 | $ 109,962 | $ 103,008 |
Tier 1 capital to average assets, Minimum to be Well Capitalized under Prompt Corrective Action Provisions Ratio | 5.00% | 5.00% |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss - Components of Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Accumulated Other Comprehensive Loss | ||
Net unrealized loss on investment securities available-for-sale | $ (3,251) | $ (1,237) |
Income tax | (683) | (260) |
Net of income taxes | (2,568) | (977) |
Benefit plan adjustments | (7,218) | (6,628) |
Income tax | (1,516) | (1,392) |
Net of income taxes | (5,702) | (5,236) |
Derivative adjustments | 246 | |
Income tax | 52 | |
Net of income taxes | 194 | |
Accumulated other comprehensive loss | $ (8,076) | $ (6,213) |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Loss - Other Comprehensive Loss and Related Tax Effects (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Accumulated Other Comprehensive Loss | |||
Unrealized (loss) gain on investment securities available-for-sale | $ (2,014) | $ (1,790) | $ (3,417) |
Net gain on the sale of investment securities available-for-sale | (623) | ||
Amortization of actuarial loss (2) | 194 | 195 | 208 |
Actuarial gain (loss) | (785) | 123 | 709 |
Change in benefit plan liabilities | (591) | 318 | 917 |
Net change in derivatives | 246 | ||
Other comprehensive loss | (2,359) | (1,472) | (3,123) |
Income tax | (496) | (515) | (1,093) |
Other comprehensive loss, net of income taxes | $ (1,863) | $ (957) | $ (2,030) |
Summary of quarterly financia_3
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, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Interest income | $ 22,482 | $ 21,419 | $ 20,766 | $ 19,994 | $ 19,351 | $ 18,831 | $ 18,261 | $ 17,799 | $ 84,661 | $ 74,242 | $ 68,984 |
Interest expense | 3,934 | 3,466 | 3,115 | 2,807 | 2,441 | 2,175 | 2,126 | 1,956 | 13,322 | 8,698 | 7,251 |
Net interest income | 18,548 | 17,953 | 17,651 | 17,187 | 16,910 | 16,656 | 16,135 | 15,843 | 71,339 | 65,544 | 61,733 |
Provision for loan losses | 1,050 | 1,050 | 1,050 | 1,050 | 1,200 | 1,200 | 1,200 | 1,200 | 4,200 | 4,800 | 5,000 |
Net interest income after provision for loan losses | 17,498 | 16,903 | 16,601 | 16,137 | 15,710 | 15,456 | 14,935 | 14,643 | 67,139 | 60,744 | 56,733 |
Noninterest income | 3,171 | 3,253 | 3,663 | 3,572 | 3,364 | 3,661 | 6,379 | 3,782 | 13,659 | 17,186 | 15,888 |
Noninterest expense | 13,373 | 12,537 | 13,496 | 13,081 | 12,455 | 12,480 | 14,002 | 12,356 | 52,487 | 51,293 | 48,030 |
Income (loss) before income taxes | 7,296 | 7,619 | 6,768 | 6,628 | 6,619 | 6,637 | 7,312 | 6,069 | |||
Income tax expense (benefit) | 904 | 902 | 811 | 774 | 3,971 | 1,287 | 1,653 | 1,269 | 3,391 | 8,180 | 5,008 |
Net income (loss) | $ 6,392 | $ 6,717 | $ 5,957 | $ 5,854 | $ 2,648 | $ 5,350 | $ 5,659 | $ 4,800 | $ 24,920 | $ 18,457 | 19,583 |
Per share data: | |||||||||||
Net income (loss) | $ 0.86 | $ 0.91 | $ 0.81 | $ 0.79 | $ 0.36 | $ 0.72 | $ 0.77 | $ 0.65 | |||
Cash dividends declared | $ 0.33 | $ 0.33 | $ 0.33 | $ 0.32 | $ 0.32 | $ 0.32 | $ 0.31 | $ 0.31 | $ 0.33 | $ 0.32 | |
Average common shares outstanding | 7,399,054 | 7,399,054 | 7,396,533 | 7,396,505 | 7,396,505 | 7,396,505 | 7,396,163 | 7,394,143 | |||
Peoples Bank | |||||||||||
Income (loss) before income taxes | $ 9,562 | $ 9,166 | 8,957 | ||||||||
Income tax expense (benefit) | (27) | (54) | (75) | ||||||||
Net income (loss) | $ 24,920 | $ 18,457 | $ 19,583 |