Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Feb. 28, 2018 | Jun. 30, 2017 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | 1ST CONSTITUTION BANCORP | ||
Document Type | 10-K | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Common Stock, Shares Outstanding | 8,112,292 | ||
Entity Public Float | $ 121,300,666 | ||
Amendment Flag | false | ||
Entity Central Index Key | 1,141,807 | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Accelerated Filer | ||
Entity Well-Known Seasoned Issuer | No | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
ASSETS | ||
Cash and Due From Banks | $ 5,037 | $ 5,348 |
Interest-earning deposits | 13,717 | 9,538 |
Total cash and cash equivalents | 18,754 | 14,886 |
Investment Securities: | ||
Available for sale, at fair value | 105,458 | 103,794 |
Held to maturity (fair value of $111,865 and $128,559 at December 31, 2017 and December 31, 2016, respectively) | 110,267 | 126,810 |
Total investment securities | 215,725 | 230,604 |
Loans Held for Sale | 4,254 | 14,829 |
Loans | 789,906 | 724,808 |
Less: Allowance for loan losses | (8,013) | (7,494) |
Net loans | 781,893 | 717,314 |
Premises and Equipment, Net | 10,705 | 10,673 |
Accrued Interest Receivable | 3,478 | 3,095 |
Bank-Owned Life Insurance | 25,051 | 22,184 |
Other Real Estate Owned | 0 | 166 |
Goodwill and Intangible Assets | 12,496 | 12,880 |
Other Assets | 6,918 | 11,582 |
Total assets | 1,079,274 | 1,038,213 |
Deposits | ||
Non-interest bearing | 196,509 | 170,854 |
Interest bearing | 725,497 | 663,662 |
Total deposits | 922,006 | 834,516 |
Overnight Borrowings | 20,500 | 63,050 |
Federal Home Loan Bank advances | 0 | 10,000 |
Redeemable Subordinated Debentures | 18,557 | 18,557 |
Accrued Interest Payable | 804 | 866 |
Accrued Expenses and Other Liabilities | 5,754 | 6,423 |
Total liabilities | 967,621 | 933,412 |
SHAREHOLDERS’ EQUITY | ||
Preferred stock, no par value; 5,000,000 shares authorized; none issued | 0 | 0 |
Common Stock, no par value; 30,000,000 shares authorized; 8,116,201 and 8,027,087 shares issued and 8,082,903 and 7,993,789 shares outstanding as of December 31, 2017 and December 31, 2016, respectively | 72,935 | 71,695 |
Retained earnings | 39,822 | 34,074 |
Treasury Stock, 33,298 shares at December 31, 2017 and 2016 | (368) | (368) |
Accumulated other comprehensive loss | (736) | (600) |
Total shareholders’ equity | 111,653 | 104,801 |
Total liabilities and shareholders’ equity | $ 1,079,274 | $ 1,038,213 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Held to maturity, fair value | $ 111,865 | $ 128,559 |
Preferred stock, par value (in Dollars per share) | $ 0 | $ 0 |
Preferred stock, shares authorized (in Shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (in Shares) | 0 | 0 |
Common stock, par value (in Dollars per share) | $ 0 | $ 0 |
Common stock, shares authorized (in Shares) | 30,000,000 | 30,000,000 |
Common stock, shares issued (in Shares) | 8,116,201 | 8,027,087 |
Common stock, shares outstanding (in Shares) | 8,082,903 | 7,993,789 |
Treasury stock shares (in Shares) | 33,298 | 33,298 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
INTEREST INCOME | |||
Loans, including fees | $ 35,967 | $ 33,701 | $ 33,975 |
Securities: | |||
Taxable | 3,326 | 3,268 | 3,167 |
Tax-exempt | 2,140 | 2,078 | 2,131 |
Federal funds sold and short-term investments | 230 | 88 | 50 |
Total interest income | 41,663 | 39,135 | 39,323 |
INTEREST EXPENSE | |||
Deposits | 4,550 | 4,044 | 3,704 |
Borrowings | 429 | 687 | 577 |
Redeemable subordinated debentures | 519 | 427 | 355 |
Total interest expense | 5,498 | 5,158 | 4,636 |
Net interest income | 36,165 | 33,977 | 34,687 |
PROVISION (CREDIT) FOR LOAN LOSSES | 600 | (300) | 1,100 |
Net interest income after provision (credit) for loan losses | 35,565 | 34,277 | 33,587 |
NON-INTEREST INCOME | |||
Service charges on deposit accounts | 596 | 715 | 818 |
Gain on sales of loans, net | 5,149 | 3,785 | 4,039 |
Income on bank-owned life insurance | 522 | 549 | 558 |
Gain on sales of securities | 129 | 0 | 0 |
Other income | 1,844 | 1,873 | 1,171 |
Total other income | 8,240 | 6,922 | 6,586 |
NON-INTEREST EXPENSES | |||
Salaries and employee benefits | 18,804 | 16,543 | 15,589 |
Occupancy expense | 3,169 | 3,243 | 3,362 |
Data processing expenses | 1,314 | 1,277 | 1,211 |
FDIC insurance expense | 360 | 453 | 660 |
Other real estate owned expenses | 42 | 74 | 734 |
Other operating expenses | 7,317 | 5,701 | 5,891 |
Total other expenses | 31,006 | 27,291 | 27,447 |
Income before income taxes | 12,799 | 13,908 | 12,726 |
INCOME TAXES | 5,871 | 4,623 | 4,062 |
Net income | $ 6,928 | $ 9,285 | $ 8,664 |
NET INCOME PER COMMON SHARE | |||
Basic (in Dollars per share) | $ 0.86 | $ 1.17 | $ 1.10 |
Diluted (in Dollars per share) | $ 0.83 | $ 1.14 | $ 1.07 |
WEIGHTED AVERAGE SHARES OUTSTANDING | |||
Basic (in Shares) | 8,049,981 | 7,962,121 | 7,901,278 |
Diluted (in Shares) | 8,312,784 | 8,177,439 | 8,075,752 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 6,928 | $ 9,285 | $ 8,664 | |
Other comprehensive (loss) income: | ||||
Unrealized holding (losses) gains on securities available for sale | (14) | (667) | (224) | |
Tax effect | 40 | 243 | 38 | |
Net of tax amount | 26 | (424) | (186) | |
Reclassification adjustment for realized gains on securities available for sale | [1] | (93) | 0 | 0 |
Tax effect | [2] | 38 | 0 | 0 |
Net of tax amount | (55) | 0 | 0 | |
Pension liability | 62 | 83 | (53) | |
Tax effect | 24 | 31 | (21) | |
Net of tax amount | 38 | 52 | (32) | |
Reclassification adjustment for actuarial gains for unfunded pension liability | [3] | (60) | (160) | (266) |
Tax effect | [2] | (24) | (62) | (106) |
Net of tax amount | (36) | (98) | (160) | |
Total other comprehensive (loss) income | (27) | (470) | (378) | |
Comprehensive income | $ 6,901 | $ 8,815 | $ 8,286 | |
[1] | Included in gain on sale of securities on the consolidated statements of income | |||
[2] | Included in income taxes on the consolidated statements of income | |||
[3] | Included in salaries and employee benefits expense on the consolidated statements of income |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity - USD ($) | Total | Common Stock [Member] | Retained Earnings [Member] | Treasury Stock [Member] | Accumulated Other Comprehensive (Loss) Income [Member] |
Balance, beginning of period at Dec. 31, 2014 | $ 87,110,000 | $ 61,448,000 | $ 25,730,000 | $ (316,000) | $ 248,000 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 8,664,000 | 8,664,000 | |||
Exercise of stock options and issuance of restricted shares under employee benefit programs (33,800 shares issued from Treasury Stock) | 292,000 | (39,000) | 331,000 | ||
Share-based compensation | 631,000 | 631,000 | |||
Treasury stock purchased, net | (359,000) | (359,000) | |||
Stock dividends declared (737,448 shares) | 0 | 8,805,000 | (8,805,000) | ||
Other comprehensive loss | (378,000) | (378,000) | |||
Balance, end of period at Dec. 31, 2015 | 95,960,000 | 70,845,000 | 25,589,000 | (344,000) | (130,000) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 9,285,000 | 9,285,000 | |||
Exercise of stock options | 96,000 | 96,000 | |||
Share-based compensation | 754,000 | 754,000 | |||
Treasury stock purchased, net | (24,000) | (24,000) | |||
Dividends on common stock | (800,000) | (800,000) | |||
Other comprehensive loss | (470,000) | (470,000) | |||
Balance, end of period at Dec. 31, 2016 | 104,801,000 | 71,695,000 | 34,074,000 | (368,000) | (600,000) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 6,928,000 | 6,928,000 | |||
Exercise of stock options | 247,000 | 247,000 | |||
Share-based compensation | 993,000 | 993,000 | |||
Dividends on common stock | (1,289,000) | (1,289,000) | |||
Other comprehensive loss | (27,000) | (27,000) | |||
Reclassification of certain deferred tax effects | (109,000) | 109,000 | (109,000) | ||
Balance, end of period at Dec. 31, 2017 | $ 111,653,000 | $ 72,935,000 | $ 39,822,000 | $ (368,000) | $ (736,000) |
Consolidated Statements of Cha7
Consolidated Statements of Changes in Shareholders' Equity (Parentheticals) - $ / shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement of Stockholders' Equity [Abstract] | |||
Stock issued for stock option exercises (in Shares) | 3,564 | 33,800 | |
Treasury stock purchased (in Shares) | 2,000 | 31,050 | |
Stock dividends declared (in Shares) | 737,448 | ||
Dividends on common stock (in Dollars per share) | $ 0.16 | $ 0.10 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
OPERATING ACTIVITIES: | |||
Net income | $ 6,928 | $ 9,285 | $ 8,664 |
Adjustments to reconcile net income to net cash provided by operating activities | |||
Provision (credit) for loan losses | 600 | (300) | 1,100 |
Provision for loss on other real estate owned | 0 | 0 | 382 |
Depreciation and amortization | 1,380 | 1,415 | 1,476 |
Net amortization of premiums and discounts on securities | 879 | 1,141 | 810 |
SBA discount accretion | (247) | (153) | (56) |
Gain on sales of securities held for sale | (93) | 0 | 0 |
Gain on sales of securities held to maturity | (36) | 0 | 0 |
(Gains) losses on sales of other real estate owned | (5) | (31) | 692 |
Gains on sales of loans held for sale | (5,149) | (3,785) | (4,039) |
Originations of loans held for sale | (110,831) | (96,968) | (134,073) |
Proceeds from sales of loans held for sale | 126,555 | 91,708 | 140,486 |
Increase cash surrender value on bank-owned life insurance | (522) | (549) | (558) |
Share-based compensation expense | 993 | 754 | 631 |
Deferred tax expense | 620 | 354 | 159 |
Provisional re-measurement of deferred tax assets and liabilities | 1,712 | 0 | 0 |
(Increase) decrease in accrued interest receivable | (383) | (242) | 243 |
(Increase) decrease in other assets | (181) | 388 | 617 |
(Decrease) increase in accrued interest payable | (62) | 20 | (61) |
Decrease in accrued expenses and other liabilities | (266) | (552) | (363) |
Net cash provided by operating activities | 21,892 | 2,485 | 16,110 |
Purchases of securities : | |||
Available for sale | (35,680) | (37,300) | (34,109) |
Held to maturity | (34,592) | (35,212) | (15,599) |
Proceeds from maturities and prepayments of securities: | |||
Available for sale | 25,770 | 23,354 | 18,783 |
Held to maturity | 49,889 | 31,429 | 35,705 |
Proceeds from sales of securities: | |||
Available for sale | 7,602 | 0 | 0 |
Held to maturity | 1,034 | 0 | 0 |
Proceeds from BOLI benefits paid | 0 | 248 | 0 |
Net redemption of restricted stock | 2,408 | ||
Net (purchase) of restricted stock | (661) | (1,516) | |
Net increase in loans | (65,387) | (42,626) | (30,590) |
Capital expenditures | (846) | (457) | (706) |
Capital improvement to OREO | (5) | (61) | 0 |
Proceeds from sales of other real estate owned | 631 | 1,033 | 6,027 |
Purchase of BOLI | (2,345) | (300) | 0 |
Net cash used in investing activities | (51,521) | (60,553) | (22,005) |
FINANCING ACTIVITIES: | |||
Exercise of stock options | 247 | 96 | 292 |
Purchase of treasury stock | 0 | (24) | (359) |
Cash dividends paid to shareholders | (1,690) | (399) | 0 |
Net increase (decrease) in deposits | 87,490 | 47,759 | (31,004) |
(Decrease) increase in overnight borrowings | (42,550) | 24,154 | 33,789 |
Repayment of long-term borrowing | (10,000) | (10,000) | 0 |
Net cash provided by financing activities | 33,497 | 61,586 | 2,718 |
Net (decrease) increase in cash | 3,868 | 3,518 | (3,177) |
Cash and cash equivalents at beginning of year | 14,886 | 11,368 | 14,545 |
Cash and cash equivalents at end of period | 18,754 | 14,886 | 11,368 |
Cash paid during the period for : | |||
Interest | 5,560 | 5,138 | 4,697 |
Income taxes | 3,220 | 4,590 | 4,170 |
Noncash items: | |||
Transfer of loans to OREO | $ 455 | $ 141 | $ 2,357 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies 1 ST Constitution Bancorp (the “Company”) is a bank holding company registered under the Bank Holding Company Act of 1956, as amended, and was organized under the laws of the State of New Jersey. The Company is the parent to 1 ST Constitution Bank (the “Bank”), a New Jersey state-chartered commercial bank. The Bank provides community banking services to a broad range of customers, including corporations, individuals, partnerships and other community organizations in the central, coastal and northeastern New Jersey areas. The Bank conducts its operations through its main office located in Cranbury, New Jersey and operated, as of December 31, 2017 , 17 additional branch offices in Cranbury, Fort Lee, Hamilton Square, Hightstown, Hillsborough, Hopewell, Jamesburg, Lawrenceville, Perth Amboy, Plainsboro, Skillman, Princeton, Rumson, Fair Haven, Asbury Park, Shrewsbury and Little Silver, New Jersey. The Bank also operates two residential mortgage loan production offices in Forked River and Jersey City, New Jersey. The Company has evaluated events and transactions occurring subsequent to the balance sheet date of December 31, 2017 for items that should potentially be recognized or disclosed in these financial statements. The evaluation was conducted through the date these financial statements were issued. Basis of Financial Statement Presentation: The consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP"). In preparing the financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the balance sheet and revenues and expenses for that period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance for loan losses, other-than-temporary security impairment, the fair value of other real estate owned, if any, and the valuation of deferred tax assets. Principles of Consolidation: The consolidated financial statements of the Company are prepared on the accrual basis and include the accounts of the Company and its wholly-owned subsidiary, the Bank, and the Bank’s wholly-owned subsidiaries, 1st Constitution Investment Company of New Jersey, Inc., FCB Assets Holdings, Inc., 204 South Newman Street Corp. and 249 New York Avenue, LLC. 1st Constitution Capital Trust II, a subsidiary of the Company (“Trust II”), is not included in the Company’s consolidated financial statements as it is a variable interest entity and the Company is not the primary beneficiary. While the following footnotes include the collective results of the Company and the Bank, the footnotes primarily reflect the Bank's and its subsidiaries' activities. All significant intercompany accounts and transactions have been eliminated in consolidation and certain prior period amounts have been reclassified to conform to current year presentation. Concentration of Credit Risk: Financial instruments which potentially subject the Company and its subsidiaries to concentrations of credit risk primarily consist of investment securities and loans. At December 31, 2017 , 41.5% of our investment securities portfolio consisted of U.S. Government and Agency issues and collateralized mortgage obligations collateralized by agency mortgage backed securities. In addition, 38.7% of the portfolio consisted of municipal bonds. The remaining 19.8% of our investment securities consisted primarily of corporate debt issues. The Bank’s lending activity is primarily concentrated in loans collateralized by real estate located primarily in the State of New Jersey. As a result, credit risk is broadly dependent on the real estate market and general economic conditions in that state. Interest Rate Risk: The Bank is principally engaged in the business of attracting deposits from the general public and using these deposits, together with other funds, to purchase investment securities and to make loans, the majority of which are secured by real estate. The potential for interest-rate risk exists as a result of the Company's generally shorter duration of interest-sensitive assets compared to the generally longer duration of interest-sensitive liabilities. In a changing interest rate environment, assets held by the Bank will re-price faster than liabilities of the Bank, thereby affecting net interest income. For this reason, management regularly monitors the maturity structure and rate adjustment features of the Bank’s assets and liabilities in order to measure its level of interest-rate risk and to plan for future volatility. Investment Securities: Investment securities which the Company has the intent and ability to hold until maturity are classified as held to maturity and are recorded at cost, adjusted for amortization of premiums and accretion of discounts. Investment securities that are held for indefinite periods of time, that management intends to use as part of its asset/liability management strategy, or that may be sold in response to changes in interest rates, changes in prepayment risk, increased capital requirements or other similar factors, are classified as available for sale and are carried at fair value. Unrealized gains and losses on available for sale securities are recorded as a separate component of shareholders’ equity. Realized gains and losses, which are computed using the specific identification method, are recognized in earnings on a trade date basis. If the fair value of a security is less than its amortized cost, the security is deemed to be impaired. Management evaluates all securities with unrealized losses quarterly to determine if such impairments are temporary or other-than-temporary in accordance with the Accounting Standards Codification (“ASC”) of the Financial Accounting Standards Board (“FASB”). Temporary impairments on available for sale securities are recognized, on a tax-effected basis, through other comprehensive income (“OCI”) with offsetting adjustments to the carrying value of the security and the balance of related deferred taxes. Temporary impairments of held to maturity securities are not recorded in the consolidated financial statements; however, information concerning the amount and duration of impairments on held to maturity securities are disclosed. Other-than-temporary impairments ("OTTI") on all equity securities and on debt securities that the Company has decided to sell, or will, more likely than not, be required to sell prior to the full recovery of fair value to a level equal to or exceeding amortized cost, are recognized in earnings. If neither of these conditions regarding the likelihood of sale for a debt security apply, the OTTI is bifurcated into credit-related and noncredit-related components. Credit-related impairment generally represents the amount by which the present value of the cash flows that are expected to be collected on a debt security fall below its amortized cost. The noncredit-related component represents the remaining portion of the impairment not otherwise designated as credit-related. The Company recognizes credit-related OTTI in earnings. Noncredit-related OTTI on debt securities are recognized in OCI. Premiums and discounts on all securities are amortized/accreted to maturity by use of the level-yield method considering the impact of principal amortization and prepayments. Federal law requires a member institution of the FHLB system to hold restricted stock of its district FHLB according to a predetermined formula. The Bank’s investment in the restricted stock of the FHLB of New York is carried at cost and is included in other assets. The investment in FHLB stock was $1.5 million and $4.0 million at December 31, 2017 and December 31, 2016 , respectively. Management evaluates the FHLB restricted stock for impairment in accordance with U.S. GAAP. Management’s determination of whether these investments are impaired is based on their assessment of the ultimate recoverability of their cost rather than by recognizing temporary declines in value. The determination of whether a decline affects the ultimate recoverability of their cost is influenced by criteria such as (1) the significance of the decline in net assets of the FHLB as compared to the capital stock amount for the FHLB and the length of time this situation has persisted, (2) commitments by the FHLB to make payments required by law or regulation and the level of such payments in relation to the operating performance of the FHLB, and (3) the impact of legislative and regulatory changes on institutions and, accordingly, on the customer base of the FHLB. Management believes no impairment charge is necessary related to the FHLB stock as of December 31, 2017 . Bank-Owned Life Insurance: The Company invests in bank-owned life insurance (“BOLI”). BOLI involves the purchasing of life insurance by the Company on a select group of its executives, directors, officers and employees. The Company is the owner and beneficiary of the policies. This pool of insurance, due to the advantages of the Bank, is profitable to the Company. This profitability offsets a portion of current and future benefit costs and is intended to provide a funding source for the payment of future benefits. The Bank’s deposits fund BOLI and the earnings from BOLI are recognized as non-interest income. Loans and Loans Held For Sale: Loans that management intends to hold to maturity are stated at the principal amount outstanding, net of unearned income. Unearned income is recognized over the lives of the respective loans, principally using the effective interest method. Interest income is generally not accrued on loans, including impaired loans, where interest or principal is 90 days or more past due, unless the loans are adequately secured and in the process of collection, or on loans where management has determined that the borrowers may be unable to meet contractual principal and/or interest obligations. When it is probable that, based upon current information, the Bank will not collect all amounts due under the contractual terms of the loan, the loan is reported as impaired. Smaller balance homogeneous type loans, such as residential loans and loans to individuals, which are collectively evaluated, are generally excluded from consideration for impairment. Loan impairment is measured based upon the present value of the expected future cash flows discounted at the loan’s effective interest rate or the underlying fair value of collateral for collateral dependent loans. When a loan, including an impaired loan, is placed on non-accrual, interest accruals cease and uncollected accrued interest is reversed and charged against current income. Non-accrual loans are generally not returned to accruing status until principal and interest payments have been brought current and full collectibility is reasonably assured. Cash receipts on non-accrual and impaired loans are applied to principal, unless the loan is deemed fully collectible. Loans held for sale are carried at the lower of aggregated cost or fair value. The fair value of loans held for sale are determined, when possible, using quoted secondary market prices. If no such quoted market prices exist, fair values are determined using quoted prices for similar loans, adjusted for the specific attributes of the loans. Realized gains and losses on loans held for sale are recognized at settlement date and are determined based on the cost, including deferred net loan origination fees and the costs of the specific loans sold. Residential mortgage loans are sold with servicing released. The Bank accounts for its transfers and servicing of financial assets in accordance with ASC Topic 860, “Transfers and Servicing” ("ASC Topic 860"). The Bank originates residential mortgages under a definitive plan to sell those loans with servicing generally released. Residential mortgage loans originated and intended for sale in the secondary market are carried at the lower of aggregate cost or estimated fair value. The Bank also originates commercial loans, of which a portion are guaranteed by the Small Business Administration ("SBA"). The guaranteed portion of the loans is generally sold into the secondary market. Gains and losses on sales are also accounted for in accordance with ASC Topic 860. The Bank enters into commitments to originate loans whereby the interest rate on the loan is determined prior to funding “rate lock commitments.” Rate lock commitments on residential mortgage loans that are intended to be sold are considered to be derivatives. Time elapsing between the issuance of a loan commitment and closing and sale of the loan generally ranges from 30 to 120 days. The Bank protects itself from changes in interest rates through the use of best efforts forward delivery commitments, whereby the Bank commits to sell a loan at the time the borrower commits to an interest rate with the intent that the buyer has assumed interest rate risk on the loan. As a result, the Bank is generally not exposed to losses nor will it realize significant gains related to its rate lock commitments due to changes in interest rates. The fair value of rate lock commitments and best efforts commitments is not readily ascertainable with precision because rate lock commitments and best efforts commitments are not actively traded in stand-alone markets. The Bank determines the fair value of rate lock commitments based upon the forward sales price that is obtained in the best efforts commitment at the time the borrower locks in the interest rate on the loan while taking into consideration the probability that the rate lock commitments will close. Due to high correlation between rate lock commitments and best efforts commitments, no gain or loss occurs on the rate lock commitments. The estimated fair value of rate lock commitments was $135,000 and $123,000 at December 31, 2017 and 2016 , respectively. ASC Topic 460, "Guarantees," requires a guarantor entity, at the inception of a guarantee covered by the measurement provisions of the interpretation, to record a liability for the fair value of the obligation undertaken in issuing the guarantee. Standby letters of credit are conditional commitments issued by the Bank to guarantee the financial performance of a customer to a third party. Those guarantees are primarily issued to support contracts entered into by customers. Most guarantees extend for one year. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. The Bank defines the fair value of these letters of credit as the fees paid by the customer or similar fees collected on similar instruments. The Bank amortizes the fees collected over the life of the instrument. The Bank generally obtains collateral, such as real estate or liens on customer assets, for these types of commitments. The Bank’s potential liability would be reduced by any proceeds obtained in liquidation of the collateral. The Bank had standby letters of credit for customers aggregating $1.2 million and $2.0 million at December 31, 2017 and 2016 , respectively. These letters of credit are primarily related to real estate lending and the approximate value of underlying collateral upon liquidation is expected to be sufficient to cover this maximum potential exposure at December 31, 2017 . The amount of the liability related to guarantees under issued standby letters of credit was not material as of December 31, 2017 and 2016 . Allowance for Loan Losses: The allowance for loan losses is maintained at a level sufficient to absorb estimated credit losses in the loan portfolio as of the date of the financial statements. The allowance for loan losses is a valuation reserve available for losses incurred or inherent in the loan portfolio and other extensions of credit. The determination of the adequacy of the allowance for loan losses is a critical accounting policy of the Bank. All, or part, of the principal balance of commercial and commercial real estate loans and construction loans are charged off against the allowance as soon as it is determined that the repayment of all, or part, of the principal balance is highly unlikely. Consumer loans are generally charged off no later than 120 days past due on a contractual basis, or earlier in the event of bankruptcy, or if there is an amount deemed uncollectible . Because all identified losses are charged off, no portion of the allowance for loan losses is restricted to any individual loan or groups of loans, and the entire allowance is available to absorb any and all loan losses. Loans are placed in a nonaccrual status when the ultimate collectability of principal or interest in whole, or in part, is in doubt. Past-due loans contractually past-due 90 days or more for either principal or interest are also placed in nonaccrual status unless they are both well secured and in the process of collection. Impaired loans are evaluated individually. Purchased Credit-Impaired (“PCI”) loans are loans acquired at a discount that is due, in part, to credit quality. PCI loans are accounted for in accordance with ASC Subtopic 310-30, "Receivables, Loans and Debt Securities Acquired with Deteriorated Credit Quality" and are initially recorded at fair value (as determined by the present value of expected future cash flows) with no valuation allowance (i.e., the allowance for loan losses). The difference between the undiscounted cash flows expected at acquisition and the initial carrying amount (fair value) of the PCI loans or the “accretable yield,” is recognized as interest income utilizing the level-yield method over the life of the loans. Contractually required payments for interest and principal that exceed the undiscounted cash flows expected at acquisition, or the “non-accretable difference,” are not recognized as a yield adjustment, as a loss accrual or a valuation allowance. Reclassifications of the non-accretable difference to the accretable yield may occur subsequent to the loan acquisition dates due to increases in expected cash flows of the loans and result in an increase in yield on a prospective basis. The following is our charge-off policy for our loan segments: Commercial, Commercial Real Estate and Construction Loans are generally fully or partially charged down to the fair value of collateral securing the asset when: • Management judges the loan to be uncollectible; • Repayment is deemed to be protracted beyond reasonable time frames; • The loan has been classified as a loss by either internal loan review process or external examiners; • The customer has filed bankruptcy and the loss becomes evident owing to a lack of assets; or • The loan is significantly past due unless both well secured and in the process of collection. Consumer Consumer loans are generally charged off no later than 120 days past due on a contractual basis, earlier in the event of bankruptcy, or if there is an amount deemed uncollectible . Premises and Equipment: Premises and equipment are stated at cost less accumulated depreciation and amortization. Depreciation is computed primarily on the straight-line method over the estimated useful lives of the related assets for financial reporting purposes and using the mandated methods by asset type for income tax purposes. Building, furniture and fixtures, equipment and leasehold improvements are depreciated or amortized over the estimated useful lives of the assets or lease terms, as applicable. Estimated useful lives of buildings are forty years, furniture and fixtures and equipment are three to fifteen years and leasehold improvements are generally three to ten years. Expenditures for maintenance and repairs are charged to expense as incurred. The Bank accounts for impairment of long-lived assets in accordance with ASC Topic 360, “Property, Plant, and Equipment,” which requires recognition and measurement for the impairment of long-lived assets to be held and used or to be disposed of by sale. The Bank had no impaired long-lived assets at December 31, 2017 and 2016 . Income Taxes: There are two components of income tax expense or benefit: current and deferred. Current income tax expense or benefit approximates cash to be paid or refunded for taxes for the applicable period. Deferred tax assets and liabilities are recognized due to differences between the basis of assets and liabilities as measured by tax laws and their basis as reported in the financial statements. Deferred tax assets are subject to management’s judgment based upon available evidence that future realizations are likely. If management determines that the Company may not be able to realize some or all of the net deferred tax asset in the future, a charge to income tax expense may be required to increase the valuation reserve of the net deferred tax asset. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred taxes of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred tax expense or benefit is recognized for the change in deferred tax assets and liabilities. The Company accounts for uncertainty in income taxes recognized in its consolidated financial statements in accordance with ASC Topic 740, "Income Taxes," which prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return, and also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. The Company has not identified any significant income tax uncertainties through the evaluation of its income tax positions for the years ended December 31, 2017 and 2016 and has not recognized any liabilities for tax uncertainties as of December 31, 2017 and 2016 . Our policy is to recognize interest and penalties on unrecognized tax benefits in income tax expense; such amounts were not significant during the years ended December 31, 2017 and 2016 . The tax years subject to examination by the taxing authorities are, for federal and state purposes, the years ended December 31, 2017 , 2016 , 2015 and 2014 . On December 22, 2017, the 2017 Tax Cuts and Jobs Act (the “Tax Act”) was enacted into law. The Tax Act contained several key tax provisions including the reduction in the corporate federal tax rate to 21% from 35% effective January 1, 2018. As a result, the Company was required to re-measure, through income tax expense, its deferred tax assets and liabilities using the enacted rate at which it expects them to be recovered or settled. In December 2017, the U.S. Securities and Exchange Commission ("SEC") also issued Staff Accounting Bulletin No. 118, "Income Tax Accounting Implications of the Tax Cuts and Jobs Act" ("SAB 118"), which allows companies to record provisional amounts during a measurement period not to extend beyond one year of the enactment date. Because the Tax Act was passed late in December 2017 and ongoing analysis and interpretation of the other key tax provisions is expected over the next 12 months, the Company considers the deferred tax re-measurements and other items to be provisional in nature. The Company expects to complete its analysis within the measurement period in accordance with SAB 118. See Note 12 - Income Taxes - for additional information. Other Real Estate Owned ("OREO"): OREO obtained through loan foreclosures or the receipt of deeds-in-lieu of foreclosure is recorded at the fair value of the related property, as determined by current appraisals less estimated costs to sell at the initial transfer from the loan portfolio. Write-downs on these properties, which occur after the initial transfer from the loan portfolio, are recorded as operating expenses. Costs of holding such properties are charged to expense in the current period. Gains, to the extent realized, and losses on the disposition of these properties are reflected in current operations. Goodwill and Other Intangible Assets: Goodwill represents the excess of the cost of an acquired entity over the fair value of the identifiable net assets acquired in accordance with the acquisition method of accounting. Goodwill is not amortized but is reviewed for potential impairment on an annual basis, or more often if events or circumstances indicated that there may be impairment, in accordance with ASC Topic 350, “Intangibles – Goodwill and Other.” Goodwill is tested for impairment at the reporting unit level and an impairment loss is recorded to the extent that the carrying amount of goodwill exceeds its implied fair value. Core deposit intangibles are a measure of the value of checking and savings deposits acquired in business combinations accounted for under the purchase method. Core deposit intangibles are amortized over their estimated lives (ranging from five to ten years) and identifiable intangible assets are evaluated for impairment if events and circumstances indicate a possible impairment. Any impairment loss related to goodwill and other intangible assets is reflected as other non-interest expense in the statement of income in the period in which the impairment was determined. No assurance can be given that future impairment tests will not result in a charge to earnings. See Note 8 – Goodwill and Intangible Assets - for additional information. Share-Based Compensation: The Company recognizes compensation expense for stock awards and options in accordance with ASC Topic 718, “Compensation – Stock Compensation.” The expense of stock-based compensation is generally measured at fair value at the grant date with compensation expense recognized over the service period, which is usually the vesting period. The Company utilizes the Black-Scholes option-pricing model to estimate the fair value of each stock option on the date of grant. The Black-Scholes model takes into consideration the exercise price and expected life of the options, the current price of the underlying stock and its expected volatility, the expected dividends on the stock and the current risk-free interest rate for the expected life of the option. The Company’s estimate of the fair value of a stock option is based on expectations derived from historical experience and may not necessarily equate to its market value when fully vested. See Note 15 – Share-Based Compensation - for additional information. Benefit Plans: The Company provides certain retirement savings benefits to employees under a 401(k) plan. The Company’s contributions to the 401(k) plan are expensed as incurred. The Company also provides retirement benefits to certain employees under supplemental executive retirement plans. The plans are unfunded and the Company accrues actuarially determined benefit costs over the estimated service period of the employees in the plans. In accordance with ASC Topic 715, “Compensation – Retirement Benefits,” the Company recognizes the unfunded status of these postretirement plans as a liability in its consolidated balance sheets and recognizes changes in that unfunded status in the year in which the changes occur through other comprehensive income. Cash and Cash Equivalents: Cash and cash equivalents includes cash on hand, interest and non-interest bearing amounts due from banks, federal funds sold and short-term investments. Generally, federal funds are sold and short-term investments are made for a one or two-day period. Reclassifications: Certain reclassifications have been made to the prior period amounts to conform with the current period presentation. Such reclassification had no impact on net income or total shareholders’ equity. Advertising Costs: It is the Company’s policy to expense advertising costs in the period in which they are incurred. Earnings Per Common Share: Basic net income per common share is calculated by dividing net income by the weighted average number of common shares outstanding during each period. Diluted net income per common share is calculated by dividing net income by the weighted average number of common shares outstanding, as adjusted for the assumed exercise of dilutive common stock warrants and common stock options using the treasury stock method. Awards of restricted shares are included in outstanding shares when granted. Unvested restricted shares are entitled to non-forfeitable dividends and participate in undistributed earnings with common shares. Awards of this nature are considered participating securities and basic and diluted earnings per share are computed under the two-class method. Dilutive securities in the tables below exclude common stock options and warrants with exercise prices that exceed the average market price of the Company’s common stock during the periods presented. Inclusion of these common stock options and warrants would be anti-dilutive to the diluted earnings per common share calculation. For the years ended December 31, 2017 , 2016 and 2015 , 8,900 , 11,088 and 25,182 options, respectively, were anti-dilutive and were not included in the computation of diluted earnings per common share. The following table illustrates the calculation of both basic and diluted earnings per share for the years ended December 31, 2017 , 2016 and 2015 : (In thousands, except per share data) 2017 2016 2015 Net income $ 6,928 $ 9,285 $ 8,664 Basic weighted average shares outstanding 8,049,981 7,962,121 7,901,278 Plus: common stock equivalents 262,803 215,318 174,474 Diluted weighted average shares outstanding 8,312,784 8,177,439 8,075,752 Earnings per share: Basic $ 0.86 $ 1.17 $ 1.10 Diluted 0.83 1.14 1.07 Comprehensive Income: Comprehensive income consists of net income and other comprehensive income (loss). Other comprehensive income (loss) includes unrealized gains and losses on securities available for sale, other-than-temporary non-credit related security impairments, and changes in the funded status of benefit plans. Variable Interest Entities: Management has determined that Trust II qualifies as a variable interest entity under ASC Topic 810, “Consolidation.” Trust II issued mandatorily redeemable preferred stock to investors, loaned the proceeds to the Company and holds, as its sole asset, subordinated debentures issued by the Company. As a qualified variable interest entity, Trust II’s balance sheet and statement of operations have never been consolidated with those of the Company because the Company is not the beneficiary. In March 2005, the Federal Reserve Board ("FRB") adopted a final rule that would continue to allow the inclusion of trust preferred securities in Tier 1 capital, but with stricter quantitative limits. Under the final rule, after a five-year transition period, the aggregate amount of trust preferred securities and certain other capital elements would be limited to 25% of Tier 1 capital elements, net of goodwill. The amount of trust preferred securities and certain other elements in excess of the limit could be included in Tier 2 capital, subject to restrictions. Based on the final rule, the Company has included all of its $18.0 million in trust preferred securities in Tier 1 capital at December 31, 2017 and 2016 . Segment Information: U.S. GAAP establishes standards for public business enterprises to report information about operating segments in their annual financial statements and requires that those enterprises report selected information about operating segments in subsequent interim financial reports issued to shareholders. It also established standards for related disclosure about products and services, geographic areas and major customers. Operating segments are components of an enterprise, which are evaluated regularly by the chief operating decision-maker in deciding how to allocate and assess resources and performance. The Company’s chief operating decision-maker is the President and Chief Executive Officer. The Company has applied the aggregation criteria for its operating segments to create one reportable segment, “Community Banking.” The Company’s Community Banking segment consists of construction, commercial, retail and mortgage banking operations. The Community Banking segment is managed as a single strategic unit, which generates revenue from a variety of products and services pro |
Investment Securities
Investment Securities | 12 Months Ended |
Dec. 31, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
Investment Securities | Investment Securities A summary of amortized cost and fair value of investment securities available for sale as of December 31, 2017 and 2016 follows: 2017 Gross Gross Amortized Unrealized Unrealized Fair (In thousands) Cost Gains Losses Value U.S. Treasury securities and obligations of U.S. Government sponsored corporations (“GSE”) $ 1,997 $ — $ (30 ) $ 1,967 Residential collateralized mortgage obligations- GSE 27,688 18 (381 ) 27,325 Residential mortgage backed securities – GSE 14,231 129 (72 ) 14,288 Obligations of state and political subdivisions 19,575 227 (82 ) 19,720 Trust preferred debt securities – single issuer 2,481 — (132 ) 2,349 Corporate debt securities 27,917 14 (248 ) 27,683 Other debt securities 12,140 12 (26 ) 12,126 $ 106,029 $ 400 $ (971 ) $ 105,458 2016 Gross Gross Amortized Unrealized Unrealized Fair (In thousands) Cost Gains Losses Value U. S. Treasury securities and obligations of U.S. Government sponsored corporations (“GSE”) $ 3,514 $ — $ (35 ) $ 3,479 Residential collateralized mortgage obligations - GSE 22,647 58 (145 ) 22,560 Residential mortgage backed securities – GSE 31,207 388 (119 ) 31,476 Obligations of state and political subdivisions 21,604 152 (356 ) 21,400 Trust preferred debt securities – single issuer 2,478 — (206 ) 2,272 Corporate debt securities 21,963 10 (205 ) 21,768 Other debt securities 845 — (6 ) 839 $ 104,258 $ 608 $ (1,072 ) $ 103,794 A summary of amortized cost, carrying value and fair value of investment securities held to maturity as of December 31, 2017 and 2016 follows: 2017 (In thousands) Amortized Cost Other-Than- Temporary Impairment Recognized In Accumulated Other Comprehensive Loss Carrying Value Gross Unrealized Gains Gross Unrealized Losses Fair Value U. S. Treasury securities and obligations of U.S. Government sponsored corporations (“GSE”) $ 3,234 $ — $ 3,234 $ — $ (84 ) $ 3,150 Residential collateralized mortgage obligations – GSE 8,701 — 8,701 94 (123 ) 8,672 Residential mortgage backed securities - GSE 34,072 — 34,072 231 (127 ) 34,176 Obligations of state and political subdivisions 63,797 — 63,797 1,224 (35 ) 64,986 Trust preferred debt securities - pooled 657 (501 ) 156 418 — 574 Other debt securities 307 — 307 — — 307 $ 110,768 $ (501 ) $ 110,267 $ 1,967 $ (369 ) $ 111,865 2016 (In thousands) Amortized Cost Other-Than- Temporary Impairment Recognized In Accumulated Other Comprehensive Loss Carrying Value Gross Unrealized Gains Gross Unrealized Losses Fair Value Obligations of U.S. Government sponsored corporations (“GSE”) $ 3,727 $ — $ 3,727 $ — $ (116 ) $ 3,611 Residential collateralized mortgage obligations – GSE 11,882 — 11,882 247 (130 ) 11,999 Residential mortgage backed securities - GSE 40,565 — 40,565 540 (113 ) 40,992 Obligations of state and political subdivisions 70,017 — 70,017 1,274 (255 ) 71,036 Trust preferred debt securities - pooled 657 (501 ) 156 303 — 459 Other debt securities 463 — 463 — (1 ) 462 $ 127,311 $ (501 ) $ 126,810 $ 2,364 $ (615 ) $ 128,559 At December 31, 2017 and December 31, 2016 , $98.4 million and $121.7 million of investment securities, respectively, were pledged to secure public funds, collateralize borrowings from the FHLB and for other purposes required or permitted by law. During 2017 , the Company sold securities with a book value of $8.5 million for a net gain of $129,000 . Included in the sales were $1.0 million of securities that were in the held to maturity portfolio and that resulted in a gain of $36,000 for year ended December 31, 2017 . All held to maturity securities sold were mortgage backed securities with a remaining book value of less than 15% of the original principal balance at the time of purchase and, as allowed in ASC 320-10-25-14, were treated as held to maturity. There were no securities gains or losses in 2016 and 2015. The following is a summary of the proceeds, gross gains, gross losses and net tax expense related to proceeds on sales of investment securities for the year ended December 31, 2017 . (In thousands) Available for Sale Held to Maturity Proceeds on sales $ 7,602 $ 1,034 Gross gains 120 36 Gross losses (27 ) — Net tax expense 31 12 The following table sets forth certain information regarding the amortized cost, carrying value, fair value, weighted average yields and contractual maturities of the Company's investment portfolio as of December 31, 2017 . Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. (Dollars in thousands) Amortized Cost Fair Value Yield Available for sale Due in one year or less $ 473 $ 473 1.84 % Due after one year through five years 24,661 24,612 2.54 Due after five years through ten years 27,307 27,131 2.72 Due after ten years 53,588 53,242 2.69 Total $ 106,029 $ 105,458 2.66 % Carrying Value Fair Value Yield Held to maturity Due in one year or less $ 28,750 $ 28,780 1.89 % Due after one year through five years 17,793 18,419 4.85 Due after five years through ten years 18,845 19,235 3.55 Due after ten years 44,879 45,431 3.09 Total $ 110,267 $ 111,865 3.14 % The following table presents gross unrealized losses on the Company's investment securities and the fair value of the related securities and length of time that the individual securities have been in a continuous unrealized loss position at December 31, 2017 and 2016 . 2017 Less than 12 months 12 months or longer Total (In thousands) Number of Securities Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses U. S. Treasury securities and obligations of U.S. Government sponsored corporations (“GSE”) 2 $ 1,967 $ (30 ) $ 3,150 $ (84 ) $ 5,117 $ (114 ) Residential collateralized mortgage obligations - GSE 11 19,237 (205 ) 8,788 (299 ) 28,025 (504 ) Residential mortgage backed securities - GSE 35 21,770 (141 ) 3,074 (58 ) 24,844 (199 ) Obligations of state and political subdivisions 42 11,594 (82 ) 2,717 (35 ) 14,311 (117 ) Trust preferred debt securities -single issuer 4 — — 2,349 (132 ) 2,349 (132 ) Corporate debt securities 7 11,967 (98 ) 7,662 (150 ) 19,629 (248 ) Other debt securities 4 8,840 (25 ) 21 (1 ) 8,861 (26 ) Total temporarily impaired securities 105 $ 75,375 $ (581 ) $ 27,761 $ (759 ) $ 103,136 $ (1,340 ) 2016 Less than 12 months 12 months or longer Total (In thousands) Number of Securities Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses U.S. Treasury securities and obligations of U.S. Government sponsored corporations (GSE) 3 $ 7,090 $ (151 ) $ — $ — $ 7,090 $ (151 ) Residential collateralized mortgage obligations-GSE 7 17,242 (275 ) — — 17,242 (275 ) Residential mortgage backed securities - GSE 29 26,581 (216 ) 3,542 (16 ) 30,123 (232 ) Obligations of state and political subdivisions 74 25,545 (611 ) — — 25,545 (611 ) Trust preferred debt securities– single issuer 4 — — 2,272 (206 ) 2,272 (206 ) Corporate debt securities 6 12,700 (204 ) 1,999 (1 ) 14,699 (205 ) Other debt securities 3 — — 1,276 (7 ) 1,276 (7 ) Total temporarily impaired securities 126 $ 89,158 $ (1,457 ) $ 9,089 $ (230 ) $ 98,247 $ (1,687 ) U.S. Treasury securities and obligations of U.S. Government sponsored corporations and agencies: The unrealized losses on investments in these securities were caused by increases in market interest rates. The contractual terms of these investments do not permit the issuer to settle the securities at a price less than the par value of the investment. The Company does not intend to sell these investments and it is not more likely than not that the Company will be required to sell these investments before a market price recovery or maturity. Therefore, these investments are not considered other-than temporarily impaired. Residential collateralized mortgage obligations and residential mortgage backed securities: The unrealized losses on investments in residential collateralized mortgage obligations and residential mortgage backed securities were caused by increases in market interest rates. The contractual cash flows of these securities are guaranteed by the issuer, primarily government or government sponsored agencies. It is expected that the securities would not be settled at a price less than the amortized cost of the investment. The Company does not intend to sell these investments and it is not more likely than not that the Company will be required to sell these investments before a market price recovery or maturity. Therefore, these investments are not considered other-than temporarily impaired. Obligations of state and political subdivisions: The unrealized losses on investments in these securities were caused by increases in market interest rates. It is expected that the securities would not be settled at a price less than the amortized cost of the investment. None of the issuers have defaulted on interest payments. These investments are not considered to be other than temporarily impaired because the decline in fair value is attributable to changes in interest rates and not credit quality. The Company does not intend to sell these investments and it is not more likely than not that the Company will be required to sell these investments before a market price recovery or maturity. Therefore, these investments are not considered other-than temporarily impaired. Trust preferred debt securities – single issuer : The investments in these securities are comprised of four corporate trust preferred securities issued by two large financial institutions that both mature in 2027. The contractual terms of the trust preferred securities do not allow the issuer to settle the securities at a price less than the face value of the trust preferred securities, which is greater than the amortized cost of the trust preferred securities. One of the issuers continues to maintain an investment grade credit rating and neither has defaulted on interest payments. The decline in fair value is attributable to the widening of interest rate spreads and the lack of an active trading market for these securities and, to a lesser degree, market concerns about the issuers’ credit quality. The Company does not intend to sell these investments and it is not more likely than not that the Company will be required to sell these investments before a market price recovery or maturity. Therefore, these investments are not considered other-than-temporarily impaired. Corporate debt securities . The unrealized losses on investments in corporate debt securities were caused by an increase in market interest rates. None of the corporate issuers have defaulted on interest payments. The decline in fair value is attributable to changes in market interest rates and not credit quality. The Company does not intend to sell these investments and it is not more likely than not that the Company will be required to sell these investments before a market price recovery or maturity. Therefore, these investments are not considered other-than-temporarily impaired. Trust preferred debt securities – pooled: This trust preferred debt security was issued by a two issuer pool (Preferred Term Securities XXV, Ltd. co-issued by Keefe, Bruyette and Woods, Inc. and First Tennessee (“PRETSL XXV”)), consisting primarily of financial institution holding companies. During 2009, the Company recognized an other-than-temporary impairment charge of $865,000 , of which $364,000 was determined to be a credit loss and charged to operations and $501,000 was recognized in the other comprehensive income (loss) component of shareholders’ equity. The primary factor used to determine the credit portion of the impairment loss to be recognized in the income statement for this security was the discounted present value of projected cash flow, where that present value of cash flow was less than the amortized cost basis of the security. The present value of cash flow was developed using a model that considered performing collateral ratios, the level of subordination to senior tranches of the security and credit ratings of and projected credit defaults in the underlying collateral. On a quarterly basis, management evaluates this security to determine if any additional other-than-temporary impairment is required. As of December 31, 2017 , management concluded that no additional other-than-temporary impairment had occurred. |
Loans and Loans Held for Sale
Loans and Loans Held for Sale | 12 Months Ended |
Dec. 31, 2017 | |
Receivables [Abstract] | |
Loans and Loans Held for Sale | Loans and Loans Held for Sale The following table presents loans outstanding, by class of loan, as of December 31, (In thousands) 2017 2016 Commercial real estate $ 308,924 $ 242,184 Mortgage warehouse lines 189,412 216,259 Construction 136,412 96,035 Commercial business 92,906 99,859 Residential real estate 40,494 44,791 Loans to individuals 21,025 23,736 Other 183 207 Gross Loans 789,356 723,071 Deferred loan costs, net 550 1,737 Total $ 789,906 $ 724,808 The Company's lending focus and business is concentrated primarily in New Jersey, particularly northern and central New Jersey. A significant portion of the total loan portfolio is secured by real estate or other collateral located in these areas. The Company is a participant in the Small Business Administration ("SBA") Preferred Lender Program and originates loans under the program that are later sold. The Company also sells residential mortgage loans in the secondary market on a non-recourse basis, generally with the related loan servicing rights released to purchasers. Loans held for sale at December 31, 2017 and 2016 included $2.3 million and $14.8 million , respectively, in residential mortgage loans that the Company intends to sell under best efforts forward sales commitments providing for delivery to purchasers generally within a two month period. The estimated fair value of the derivatives of interest-rate lock commitments was $135,000 at December 31, 2017 and $123,000 at December 31, 2016 . The following table presents loans held for sale, by type of loan, as of December 31, 2017 and 2016. (In thousands) 2017 2016 Residential real estate $ 2,269 $ 14,829 SBA 1,985 — $ 4,254 $ 14,829 Loans sold to others and serviced by the Company are not included in the accompanying Consolidated Balance Sheets. The total amount of such loans serviced, but owned by outside investors, amounted to approximately $42.3 million and $32.6 million at December 31, 2017 and 2016, respectively. At December 31, 2017 and 2016, the carrying value, of servicing assets was $726,000 and $605,000 , respectively. The fair value of SBA servicing assets was determined using a discount rate of 10.25% on the servicing asset and 12.50% on the excess servicing and constant prepayment speeds averaging 8.50% . The table below summarizes the changes in the related servicing assets for the years ended December 31, 2017 and 2016. (In thousands) 2017 2016 Balance, beginning of year $ 605 $ 345 Servicing assets capitalized 302 377 Amortization expense (181 ) (117 ) Balance, end of year $ 726 $ 605 In addition, the Company had discounts of $863,000 and $756,000 |
Allowance for Loan Losses and C
Allowance for Loan Losses and Credit Quality Disclosures | 12 Months Ended |
Dec. 31, 2017 | |
Receivables [Abstract] | |
Allowance for Loan Losses and Credit Quality Disclosures | Allowance for Loan Losses and Credit Quality Disclosures The Company’s primary lending emphasis is the origination of commercial business and commercial real estate loans and mortgage warehouse lines of credit. Based on the composition of the loan portfolio, the primary inherent risks are deteriorating credit quality, a decline in the economy and a decline in New Jersey real estate market values. Any one, or a combination, of these events may adversely affect the loan portfolio and may result in increased delinquencies, loan losses and increased future provision levels. The following table provides an aging of the loan portfolio by loan class at December 31, 2017 and 2016 : 2017 (Dollars in thousands) 30-59 Days 60-89 Days Greater than 90 Days Total Past Due Current Total Loans Receivable Recorded Investment > 90 Days Accruing Nonaccrual Loans Commercial real estate $ 540 $ — $ 2,465 $ 3,005 $ 305,919 $ 308,924 $ — $ 2,465 Mortgage warehouse lines — — — — 189,412 189,412 — — Construction — $ — — $ — 136,412 136,412 — — Commercial business 180 545 619 1,344 91,562 92,906 — 4,212 Residential real estate 911 256 69 1,236 39,258 40,494 — 69 Loans to individuals 119 — 116 235 20,790 21,025 — 368 Other — — — — 183 183 — — $ 1,750 $ 801 $ 3,269 $ 5,820 $ 783,536 789,356 $ — $ 7,114 Deferred loan costs, net 550 Total $ 789,906 2016 (Dollars in thousands) 30-59 Days 60-89 Days Greater than 90 Days Total Past Due Current Total Loans Receivable Recorded Investment > 90 Days Accruing Nonaccrual Loans Commercial real estate $ 741 $ 942 $ 2,707 $ 4,390 $ 237,794 $ 242,184 $ — $ 3,187 Mortgage warehouse lines — — — — 216,259 216,259 — — Construction — — 186 $ 186 95,849 96,035 — 186 Commercial business 113 115 790 1,018 98,841 99,859 — 920 Residential real estate 564 — 392 956 43,835 44,791 — 544 Loans to individuals — 29 361 390 23,346 23,736 24 337 Other — — — — 207 207 — — $ 1,418 $ 144 $ 4,436 $ 6,940 $ 716,131 723,071 $ 24 $ 5,174 Deferred loan costs, net 1,737 Total $ 724,808 As provided by ASC 310-30, the excess of cash flows expected at acquisition over the initial investment in the loan is recognized as interest income over the life of the loan. At December 31, 2017 and 2016 , there were no PCI loans and $439,000 of PCI loans, respectively, that were not classified as non-performing loans due to the accretion of income based on their original contract terms. Additional income before taxes amounting to $514,000 , $522,000 and $471,000 would have been recognized in 2017 , 2016 and 2015, respectively, if interest on all loans had been recorded based upon their original contract terms. Management reviews the adequacy of the allowance for loan losses on at least a quarterly basis to ensure that the provision for loan losses has been charged against earnings in an amount necessary to maintain the allowance at a level that is adequate based on management’s assessment of probable estimated losses. The Company’s methodology for assessing the adequacy of the allowance for loan losses consists of several key elements and is consistent with U.S. GAAP and interagency supervisory guidance. The allowance for loan losses methodology consists of two major components. The first component is an estimation of losses associated with individually identified impaired loans, which follows ASC Topic 310. The second major component estimates losses under ASC Topic 450, which provides guidance for estimating losses on groups of loans with similar risk characteristics. The Company’s methodology results in an allowance for loan losses which includes a specific reserve for impaired loans, an allocated reserve and an unallocated portion. When analyzing groups of loans under ASC Topic 450, the Company follows the Interagency Policy Statement on the Allowance for Loan and Lease Losses. The methodology considers the Company’s historical loss experience adjusted for changes in trends, conditions, and other relevant factors that affect repayment of the loans as of the evaluation date. These adjustment factors, known as qualitative factors, include: • Delinquencies and non-accruals; • Portfolio quality; • Concentration of credit; • Trends in volume and type of loans; • Quality of collateral; • Policy and procedures; • Experience, ability and depth of management; • Economic trends – national and local; and • External factors – competition, legal and regulatory. The methodology includes the segregation of the loan portfolio into loan classes with a further segregation into risk rating categories, such as special mention, substandard, doubtful, and loss. This allows for an allocation of the allowance for loan losses by loan type; however, the allowance is available to absorb any loan loss without restriction. Larger balance, non-homogeneous loans representing significant individual credit exposures are evaluated individually through the internal loan review process. It is this process that produces the watch list for loans that have indications of credit weakness. The borrower’s overall financial condition, repayment sources, guarantors and value of collateral, if appropriate, are evaluated. Based on these reviews, an estimate of probable losses for the individual larger-balance loans are determined, whenever possible, and used to establish specific loan loss reserves. In general, for non-homogeneous loans not individually assessed and for homogeneous groups, such as residential mortgages and consumer credits, the loans are collectively evaluated based on delinquency status, loan type, and historical losses. These loan groups are then internally risk rated. The watch list includes loans that are assigned a rating of special mention, substandard, doubtful and loss. Loans assigned a rating of special mention have potential weaknesses that deserve management’s close attention. If uncorrected, the potential weaknesses may result in deterioration of the repayment prospects. Loans classified as substandard have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They include loans that are inadequately protected by the current sound net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans classified as doubtful have all the weaknesses inherent in loans classified as substandard with the added characteristic that collection or liquidation in full, on the basis of current conditions and facts, is highly improbable. Loans rated as doubtful in whole, or in part, are placed in non-accrual status. Loans classified as a loss are considered uncollectible and are charged off against the allowance for loan losses. The specific allowance for impaired loans is established for specific loans that have been identified by management as being impaired. These loans are considered to be impaired primarily because the loans have not performed according to payment terms and there is reason to believe that repayment of the loan principal in whole, or in part, is unlikely. The specific portion of the allowance is the total amount of potential unconfirmed losses for these individual impaired loans. To assist in determining the fair value of loan collateral, the Company often utilizes independent third party qualified appraisal firms which, in turn, employ their own criteria and assumptions that may include occupancy rates, rental rates and property expenses, among others. The second category of reserves consists of the allocated portion of the allowance. The allocated portion of the allowance is determined by taking pools of loans outstanding that have similar characteristics and applying historical loss experience for each pool. This estimate represents the potential unconfirmed losses within the portfolio. Individual loan pools are created for commercial business loans and commercial real estate loans, construction loans, warehouse lines of credit and various types of loans to individuals. The historical loss estimation for each loan pool is then adjusted for qualitative factors such as economic trends, concentrations of credit, trends in the volume of loans, portfolio quality, delinquencies and non-accrual trends. These factors are evaluated for each class of the loan portfolio and may have positive or negative effects on the allocated allowance for the loan portfolio segment. The aggregate amount resulting from the application of these qualitative factors determines the overall risk for the portfolio and results in an allocated allowance for each of the loan segments. The Company also maintains an unallocated allowance. The unallocated allowance is used to cover any factors or conditions which may cause a potential loan loss but are not specifically identifiable. It is prudent to maintain an unallocated portion of the allowance because no matter how detailed an analysis of potential loan losses is performed, these estimates, by definition, lack precision. Management must make estimates using assumptions and information that is often subjective and changing rapidly. The following discusses the risk characteristics of each of our loan portfolios. Commercial Business The Company offers a variety of commercial loan services, including term loans, lines of credit and loans secured by equipment and receivables. A broad range of short-to-medium term commercial loans, both secured and unsecured, are made available to businesses for working capital (including inventory and receivables), business expansion (including acquisition and development of real estate and improvements) and the purchase of equipment and machinery. Commercial business loans are granted based on the borrower's ability to generate cash flow to support its debt obligations and other cash related expenses. A borrower's ability to repay commercial business loans is substantially dependent on the success of the business itself and on the quality of its management. As a general practice, the Company takes as collateral a security interest in any available real estate, equipment, inventory, receivables or other personal property of its borrowers, although the Company occasionally makes commercial business loans on an unsecured basis. Generally, the Company requires personal guarantees of its commercial business loans to offset the risks associated with such loans. Much of the Company's lending is in northern and central New Jersey. As a result of this geographic concentration, a significant broad-based deterioration in economic conditions in New Jersey and the New York City metropolitan area could have a material adverse impact on the Company's loan portfolio. A prolonged decline in economic conditions in our market area could restrict borrowers' ability to pay outstanding principal and interest on loans when due. The value of assets pledged as collateral may decline and the proceeds from the sale or liquidation of these assets may not be sufficient to repay the loan. Commercial Real Estate Commercial real estate loans are made to businesses to expand their facilities and operations and to real estate operators to finance the acquisition of income producing properties. The Company's loan policy requires that borrowers have sufficient cash flow to meet the debt service requirements and the value of the property meets the loan-to-value criteria set in the loan policy. The Company monitors loan concentrations by borrower, by type of property and by location and other criteria. The Company's commercial real estate portfolio is largely secured by real estate collateral located in the State of New Jersey. Conditions in the real estate markets in which the collateral for the Company's loans are located strongly influence the level of the Company's non-performing loans. A decline in the New Jersey real estate market could adversely affect the Company's loan portfolio. Decreases in local real estate values would adversely affect the value of property used as collateral for the Company's loans. Adverse changes in the economy also may have a negative effect on the ability of our borrowers to make timely repayments of their loans. Construction Financing Construction financing is provided to businesses to expand their facilities and operations and to real estate developers for the acquisition, development and construction of residential and commercial properties. First mortgage construction loans are made to developers and builders primarily for single family homes and multi-family buildings that are presold or are to be sold or leased on a speculative basis. The Company lends to builders and developers with established relationships, successful operating histories and sound financial resources. Management has established underwriting and monitoring criteria to minimize the inherent risks of real estate construction lending. The risks associated with speculative construction lending include the borrower's inability to complete the construction process on time and within budget, the sale or rental of the project within projected absorption periods and the economic risks associated with real estate collateral. Such loans may include financing the development and/or construction of residential subdivisions. This activity may involve financing land purchases and infrastructure development (i.e., roads, utilities, etc.) as well as construction of residences or multi-family dwellings for subsequent sale by the developer/builder. Because the sale or rental of developed properties is integral to the success of developer business, loan repayment may be especially subject to the volatility of real estate market values. Mortgage Warehouse Lines of Credit The Company’s Mortgage Warehouse Funding Group provides revolving lines of credit that are available to licensed mortgage banking companies. The warehouse line of credit is used by the mortgage banker to originate one-to-four family residential mortgage loans that are pre-sold into the secondary mortgage market, which includes state and national banks, national mortgage banking firms, insurance companies and government-sponsored enterprises, including the Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation and others. On average, an advance under the warehouse line of credit remains outstanding for a period of less than 30 days, with repayment coming directly from the sale of the loan into the secondary mortgage market. Interest and a transaction fee are collected by the Company at the time of repayment. As a separate segment of the total portfolio, the warehouse loan portfolio is individually analyzed as a whole for allowance for loan losses purposes. Warehouse lines of credit are subject to the same inherent risks as other commercial lending, but the overall degree of risk differs. While the Company’s loss experience with this type of lending has been non-existent since the product was introduced in 2008, there are other risks unique to this lending that still must be considered in assessing the adequacy of the allowance for loan losses. These unique risks may include, but are not limited to, (i) credit risks relating to the mortgage bankers that borrow from us, (ii) the risk of intentional misrepresentation or fraud by any of such mortgage bankers, (iii) changes in the market value of mortgage loans originated by the mortgage banker, the sale of which is the expected source of repayment of the borrowings under a warehouse line of credit, due to changes in interest rates during the time in warehouse or (iv) unsalable or impaired mortgage loans so originated, which could lead to decreased collateral value and the failure of a purchaser of the mortgage loan to purchase the loan from the mortgage banker. Consumer The Company’s consumer loan portfolio segment is comprised of residential real estate loans, loans to individuals and other loans. Individual loan pools are created for the various types of loans to individuals. The principal risk is the borrower becomes unemployed or has a significant reduction in income. In general, for homogeneous groups such as residential mortgages and consumer credits, the loans are collectively evaluated based on delinquency status, loan type and historical losses. These loan groups are then internally risk rated. The Company considers the following credit quality indicators in assessing the risk in the loan portfolio: • Consumer credit scores; • Internal credit risk grades; • Loan-to-value ratios; • Collateral; and • Collection experience. Internal Risk Rating of Loans The Company’s internal credit risk grades are based on the definitions currently utilized by the banking regulatory agencies. The grades assigned and their definitions are as follows, and loans graded excellent, above average, good and watch list are treated as “pass” for grading purposes: 1. Excellent - Loans that are based upon cash collateral held at the Company and adequately margined. Loans that are based upon "blue chip" stocks listed on the major stock exchanges and adequately margined. 2. Above Average - Loans to companies whose balance sheets show excellent liquidity and long-term debt is on well-spread schedules of repayment easily covered by cash flow. Such companies have been consistently profitable and have diversification in their product lines or sources of revenue. The continuation of profitable operations for the foreseeable future is likely. Management is comprised of a mix of ages, experience and backgrounds, and management succession is in place. Sources of raw materials and, for service companies, the sources of revenue are abundant. Future needs have been planned for. Character and management ability of individuals or company principals are excellent. Loans to individuals are supported by high net worths and liquid assets. 3. Good - Loans to companies whose balance sheets show good liquidity and cash flow adequate to meet maturities of long-term debt with a comfortable margin. Such companies have established profitable records over a number of years, and there has been growth in net worth. Operating ratios are in line with those of the industry, and expenses are in proper relationship to the volume of business done and the profits achieved. Management is well-balanced and competent in their responsibilities. Economic environment is favorable; however, competition is strong. The prospects for growth are good. Loans in this category do not meet the collateral requirements of loans in categories 1 and 2 above. Loans to individuals are supported by good net worth but whose supporting assets are illiquid. 3w. Watch - Included in this category are loans evidencing problems identified by Company management that require closer supervision. Such problems have not developed to the point which requires a "special mention" rating. This category also covers situations where the Company does not have adequate current information upon which credit quality can be determined. The account officer has the obligation to correct these deficiencies within 30 days from the time of notification. 4. Special Mention - A "special mention" loan has potential weaknesses that deserve management's close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or in the Company's credit position at some future date. Special mention loans are not adversely classified and do not expose the Company to sufficient risk to warrant adverse classification. 5. Substandard - A "substandard" loan is inadequately protected by the current sound worth and paying capacity of the obligor or by 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 Company will sustain some loss if the deficiencies are not corrected. 6. Doubtful - A loan classified as "doubtful" has all the weaknesses inherent in a loan classified as substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently known facts, conditions and values, highly questionable and improbable. 7. Loss - A loan classified as "loss" is considered uncollectible and of such little value that its continuance on the books 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 desireable to defer writing off this loan even though partial recovery may occur in the future. The following table provides a breakdown of the loan portfolio by credit quality indicator at December 31, 2017 and 2016 : Commercial Credit Exposure by Internally Assigned Grade 2017 (In thousands) Construction Commercial Business Commercial Real Estate Mortgage Warehouse Lines Residential Real Estate Pass $ 136,180 $ 84,746 $ 289,203 $ 189,412 $ 39,539 Special Mention 232 3,454 13,267 — 666 Substandard — 1,252 6,454 — 289 Doubtful — 3,454 — — — Total $ 136,412 $ 92,906 $ 308,924 $ 189,412 $ 40,494 Consumer Credit Exposure by Payment Activity 2017 (In thousands) Loans to Individuals Other Performing $ 20,657 $ 183 Nonperforming 368 — Total $ 21,025 $ 183 Commercial Credit Exposure by Internally Assigned Grade 2016 (In thousands) Construction Commercial Business Commercial Real Estate Mortgage Warehouse Lines Residential Real Estate Pass $ 95,548 $ 92,117 $ 223,226 $ 216,259 $ 43,950 Special Mention 301 7,102 14,334 — 244 Substandard 186 611 4,624 — 597 Doubtful — 29 — — — Total $ 96,035 $ 99,859 $ 242,184 $ 216,259 $ 44,791 Consumer Credit Exposure by Payment Activity 2016 (In thousands) Loans to Individuals Other Performing $ 23,375 $ 207 Nonperforming 361 — Total $ 23,736 $ 207 Impaired Loans Disclosures Loans are considered to be impaired when, based on current information and events, it is determined that the Company will not be able to collect all amounts due according to the loan contract, including scheduled interest payments. When a loan is placed on non-accrual status, it is also considered to be impaired. Loans are placed on non-accrual status when: (1) the full collection of interest or principal becomes uncertain; or (2) they are contractually past due 90 days or more as to interest or principal payments unless the loans are both well secured and in the process of collection. The following tables summarize the distribution of the allowance for loan losses and loans receivable by loan class and impairment method as of and for the years ended December 31, 2017 , 2016 and 2015, respectively. 2017 (Dollars in thousands) Construction Commercial Business Commercial Real Estate Mortgage Warehouse Lines Residential Real Estate Loans to Individuals Other Unallocated Deferred Fees Total Allowance for loan losses: Beginning balance $ 1,204 $ 1,732 $ 2,574 $ 973 $ 367 $ 112 $ — $ 532 $ 7,494 Provision (credit) charged to operations 499 2 358 (121 ) 126 (2 ) (13 ) (249 ) 600 Loans charged off — (61 ) — — (101 ) — — — (162 ) Recoveries of loans charged off — 47 17 — — 4 13 — 81 Ending balance $ 1,703 $ 1,720 $ 2,949 $ 852 $ 392 $ 114 $ — $ 283 $ 8,013 Individually evaluated for impairment $ — $ 592 $ 92 $ — $ — $ — $ — $ — $ 684 Collectively evaluated 1,703 1,128 2,460 852 392 114 — 283 7,329 Ending balance $ 1,703 $ 1,720 $ 2,949 $ 852 $ 392 $ 114 $ — $ 283 $ 8,013 Loans receivables: Loans acquired with deteriorated credit quality $ — $ 274 $ 590 $ — $ — $ — $ — $ — $ — $ 864 Individually evaluated for impairment 232 4,459 5,713 — 69 368 — — — 10,841 Collectively evaluated for impairment $ 136,180 88,173 $ 302,621 189,412 40,425 $ 20,657 183 — 550 778,201 Total $ 136,412 $ 92,906 $ 308,924 $ 189,412 $ 40,494 $ 21,025 $ 183 $ — $ 550 $ 789,906 2016 (In thousands) Construction Commercial Business Commercial Real Estate Mortgage Warehouse Lines Residential Real Estate Loans to Individuals Other Unallocated Deferred Fees Total Allowance for loan losses: Beginning balance $ 1,025 $ 2,005 $ 3,049 $ 866 $ 288 $ 109 $ — $ 218 $ 7,560 (Credit) provision charged to operations 179 (177 ) (800 ) 107 79 (3 ) 1 314 (300 ) Loans charged off — (97 ) (60 ) — — — (1 ) — (158 ) Recoveries of loans charged off — 1 385 — — 6 — 392 Ending balance $ 1,204 $ 1,732 $ 2,574 $ 973 $ 367 $ 112 $ — $ 532 $ 7,494 Individually evaluated for impairment $ 7 $ 101 $ 114 $ — $ 38 $ — $ — $ — $ 260 Collectively evaluated for impairment 1,197 1,631 2,460 973 329 112 — 532 7,234 Ending balance $ 1,204 $ 1,732 $ 2,574 $ 973 $ 367 $ 112 $ — $ 532 $ 7,494 Loans receivable: Loans acquired with deteriorated credit quality $ — $ 191 $ 930 $ — $ — $ — $ — $ — $ — $ 1,121 Individually evaluated for impairment 391 947 3,817 — 544 337 — — — 6,036 Collectively evaluated for impairment 95,644 98,721 237,437 216,259 44,247 23,399 207 — 1,737 717,651 Total $ 96,035 $ 99,859 $ 242,184 $ 216,259 $ 44,791 $ 23,736 $ 207 $ — $ 1,737 $ 724,808 2015 (In thousands) Construction Commercial Business Commercial Real Estate Mortgage Warehouse Lines Residential Real Estate Loans to Individuals Other Unallocated Deferred Fees Total Allowance for loan losses: Beginning balance $ 1,215 $ 1,761 $ 2,393 $ 896 $ 197 $ 129 $ 2 $ 332 $ 6,925 (Credit) provision charged to operations (190 ) 347 1,010 (30 ) 91 (13 ) (1 ) (114 ) 1,100 Loans charged off — (116 ) (361 ) — — (13 ) (1 ) — (491 ) Recoveries of loans charged off — 13 7 — — 6 — — 26 Ending balance $ 1,025 $ 2,005 $ 3,049 $ 866 $ 288 $ 109 $ — $ 218 $ 7,560 When a loan is identified as impaired, the measurement of impairment is based on the present value of expected future cash flows, discounted at the loan’s effective interest rate, except when the sole remaining source of repayment for the loan is the liquidation of the collateral. In such cases, the current fair value of the collateral less selling costs is used. If the value of the impaired loan is less than the recorded investment in the loan, the impairment is recognized through an allowance estimate or a charge to the allowance. The following tables summarize information regarding impaired loans receivable by loan class as of and for the years ended December 31, 2017 , 2016 and 2015, respectively. 2017 (Dollars in thousands) Recorded Investment Unpaid Principal Balance Related Allowance Year to Date 2017 Average Recorded Investment Year to Date 2017 Interest Income Recognized With no related allowance: Commercial: Construction $ 232 $ 232 $ — $ 209 $ 12 Commercial business 1,271 1,419 — 828 153 Commercial real estate 1,348 1,372 — 2,772 128 Mortgage warehouse lines — — — — — 2,851 3,023 — 3,809 293 Consumer: Residential real estate 69 123 — 142 — Loans to individuals 368 438 — 342 — Other — — — — — 437 561 — 484 — With no related allowance 3,288 3,584 — 4,293 293 With an allowance: Commercial: Construction — — — 86 — Commercial business 3,462 3,464 592 2,864 84 Commercial real estate 4,955 5,748 92 3,005 188 Mortgage warehouse lines — — — — — 8,417 9,212 684 5,955 272 Consumer: Residential real estate — — — 75 — Loans to individuals — — — — — Other — — — — — — — — 75 — With an allowance 8,417 9,212 684 6,030 272 Total: Construction 232 232 — 295 12 Commercial business 4,733 4,883 592 3,692 237 Commercial real estate 6,303 7,120 92 5,777 316 Mortgage warehouse lines — — — — — Residential real estate 69 123 — 217 — Loans to individuals 368 438 — 342 — Other — — — — — $ 11,705 $ 12,796 $ 684 $ 10,323 $ 565 December 31, 2016 (Dollars in thousands) Recorded Investment Unpaid Principal Balance Related Allowance Year to Date 2016 Average Recorded Investment Year to Date 2016 Interest Income Recognized With no related allowance: Commercial: Construction $ 186 $ 186 $ — $ 260 $ — Commercial business 883 1,054 — 623 14 Commercial real estate 1,380 1,380 — 1,528 74 Mortgage warehouse lines — — — — — 2,449 2,620 — 2,411 88 Consumer: Residential real estate 244 244 — 725 — Loans to individuals 337 337 — 281 — Other — — — — — 581 581 — 1,006 — With no related allowance 3,030 3,201 — 3,417 88 With an allowance: Commercial: Construction 205 205 7 51 9 Commercial business 255 255 101 238 — Commercial real estate 3,367 3,367 114 3,603 19 Mortgage warehouse lines — — — — — 3,827 3,827 222 3,892 28 Consumer: Residential real estate 300 316 38 200 — Loans to individuals — — — — — Other — — — — — 300 316 38 200 — With an allowance 4,127 4,143 260 4,092 28 Total: Construction 391 391 7 311 9 Commercial business 1,138 1,309 101 861 14 Commercial real estate 4,747 4,747 114 5,131 93 Mortgage warehouse lines — — — — — Residential real estate 544 560 38 925 — Loans to individuals 337 337 — 281 — Other — — — — — $ 7,157 $ 7,344 $ 260 $ 7,509 $ 116 (Dollars in thousands) Year to Date 2015 Average Recorded Investment Year to Date 2015 Interest Income Recognized With no related allowance: Commercial: Construction $ 477 $ 27 Commercial business 492 23 Commercial real estate 2,998 94 Mortgage warehouse lines — — 3,967 144 Consumer: Residential real estate 981 — Loans to individuals 88 — Other — — 88 — With no related allowance 5,036 144 With an allowance: Commercial: Construction — — Commercial business 307 5 Commercial real estate 4,200 154 Mortgage warehouse lines — — 4,507 159 Consumer: Residential real estate 100 — Loans to individuals 175 — Other — — 275 — With an allowance 4,882 159 Total: Construction 477 27 Commercial business 799 28 Commercial real estate 7,198 248 Mortgage warehouse lines — — Residential real estate 1,081 — Loans to individuals 263 — Other — — $ 9,818 $ 303 Purchased Credit-Impaired Loans Purchased Credit-Impaired Loans ("PCI") are loans acquired at a discount that is due in part to credit quality. Acquired loans totaling $2.6 million were deemed to be PCI at February 7, 2014 and were initially recorded at fair value (as determined by the present value of expected future cash flows) with no valuation allowance (i.e., the allowance for loan losses). The following table presents additional information regarding PCI loans at December 31, 2017 and 2016 : (In thousands) 2017 2016 Outstanding balance $ 998 $ 1,470 Carrying amount 860 1,121 In 2017 and 2016, no loan loss provision was recorded for PCI loans. In 2015, a loan loss provision in the amount of $64,000 was recorded for one PCI loan. The following table presents changes in accretable discount for PCI loans for the years ended December 31, 2017 , 2016 and 2015 : (In thousands) 2017 2016 2015 Balance at beginning of year $ 30 $ 73 $ 135 Transfer from non-accretable to accretable 161 — — Accretion of discount (65 ) (43 ) (62 ) Balance at end of year $ 126 $ 30 73 Non-accretable difference at end of year $ 26 $ 215 $ 215 The following table presents the years for the scheduled remaining accretable discount that will accrete to income based on the Company’s most recent estimates of cash flows for PCI loans: (In thousands) Years ending December 31, 2018 $ 82 2019 44 Thereafter — Total $ 126 Consumer Mortgage Loans Secured by Residential Real Estate in Process of Foreclosure The following table summarizes the recorded investment in consumer mortgage loans secured by residential real estate in process of foreclosure: December 31, (Dollars in thousands) 2017 2016 Number of loans Recorded Investment Number of loans Recorded Investment 1 $ 77 3 $ 524 In the normal course of business, the Company may consider modifying loan terms for various reasons. These reasons may include as a retention strategy to compete in the current interest rate environment or to re-amortize or extend a loan term to better match the loan’s payment stream with the borrower’s cash flow. A modified loan would be considered a troubled debt restructuring (“TDR”) if the Company grants a concession to a borrower and has determined that the borrower is troubled (i.e., experiencing financial difficulties). If the Company restructures a loan to a troubled borrower, the loan terms (i.e., interest rate, payment, amortization period, maturity date) may be modified in various ways to enable the borrower to cover the modified debt service payments based on current financial information and cash flow adequacy. If a borrower’s hardship is thought to be temporary, then modified terms may only be offered for that time period. Where possible, the Company would attempt to obtain additional collateral and/or secondary repayment sources at the time of the restructure in order to put the Company in the best possible position if the borrower is not able to meet the modified terms. The Company will not offer modified terms if it believes that modifying the loan terms will only delay an inevitable permanent default. In evaluating whether a restructuring constitutes a troubled debt restructuring, applicable guidance requires that a creditor must s |
Related Parties
Related Parties | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Parties | Related Parties Activity related to loans to directors, executive officers and their affiliated interests during the years ended December 31, 2017 and 2016 is as follows: (In thousands) 2017 2016 2015 Balance, beginning of year $ 1,357 $ 870 $ 1,376 Loans granted 1,603 751 16 Repayments of loans (241 ) (264 ) (522 ) Balance, end of year $ 2,719 $ 1,357 $ 870 All such loans were made under customary terms and conditions and were current as to principal and interest payments as of December 31, 2017 and 2016 . Related party deposits were $10.7 million and $14.9 million at December 31, 2017 and 2016 , respectively. Rent of approximately $122,000 was paid in 2017 to an entity affiliated with a director of the Company for the lease of one of the Company’s offices. |
Premises and Equipment
Premises and Equipment | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Premises and Equipment | Premises and Equipment Premises and equipment consist of the following at December 31, (Dollars in thousands) Estimated Useful Lives 2017 2016 Land $ 1,798 $ 1,798 Building 40 years 8,083 8,083 Leasehold improvements 3 - 10 years 6,241 5,864 Furniture, fixtures and equipment 3 - 15 years 5,032 4,794 Projects in progress 337 103 21,491 20,642 Less: Accumulated depreciation 10,786 9,969 Total $ 10,705 $ 10,673 Depreciation expense was $814,000 , $893,000 and $1 million for the years ended December 31, 2017 , 2016 and 2015 |
Other Real Estate Owned ("OREO"
Other Real Estate Owned ("OREO") | 12 Months Ended |
Dec. 31, 2017 | |
Real Estate [Abstract] | |
Other Real Estate Owned (OREO) | Other Real Estate Owned (“OREO”) The following table presents the activity in other real estate owned for the years ended December 31, (In thousands) 2017 2016 2015 Balance, beginning of year $ 166 $ 966 $ 5,710 OREO properties added 455 141 2,357 Sales during the year (626 ) (1,002 ) (6,719 ) Increase (decrease) in carrying amount of real estate owned 5 61 (382 ) Balance, end of year $ — $ 166 $ 966 The Company recorded gains on sales of other real estate owned of $5,000 and $31,000 for the years ended December 31, 2017 and 2016 , respectively, and losses of $692,000 for the year ended December 31, 2015 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets The table below presents goodwill and intangible assets at December 31, (In thousands) 2017 2016 Goodwill $ 11,854 $ 11,854 Core deposits intangible 642 1,026 Total $ 12,496 $ 12,880 Amortization expense of intangible assets was $384,000 , $404,000 and $428,000 for the years ended December 31, 2017 , 2016 and 2015 , respectively. Scheduled amortization of the core deposits intangible is as follows: (In thousands) Year Amount 2018 $ 305 2019 110 2020 88 2021 67 2022 45 After five years 27 $ 642 |
Deposits
Deposits | 12 Months Ended |
Dec. 31, 2017 | |
Banking and Thrift [Abstract] | |
Deposits | Deposits The following table presents the details of total deposits at December 31, % of Total % of Total (Dollars in thousands) 2017 Deposits 2016 Deposits Non-interest bearing $ 196,509 21.31 % $ 170,854 20.47 % Interest bearing 372,133 40.36 310,103 37.16 Savings 215,197 23.34 205,294 24.60 Certificates of deposit 138,167 14.99 148,265 17.77 $ 922,006 100.00 % $ 834,516 100.00 % At December 31, 2017 , certificates of deposit have contractual maturities as follows: (In thousands) Year Amount 2018 $ 76,293 2019 33,238 2020 9,418 2021 12,107 2022 7,111 $ 138,167 Certificates of deposit greater than $250,000 were $23.6 million and $23.9 million |
Borrowings
Borrowings | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Borrowings | Borrowings At December 31, 2017 the Company had overnight borrowings totaling $20.5 million with an average interest rate of 1.53% . Overnight borrowings at December 31, 2016 totaled $63.1 million with a weighted average rate of 0.74% . These borrowings are primarily used to fund asset growth not supported by deposit generation. At December 31, 2016 , the Company had a fixed-rate convertible advance from the FHLB in the amount of $10.0 million with an interest rate of 4.08% . This advance matured and was repaid in full on July 31, 2017. At December 31, 2017 , unused short-term or overnight borrowing potential totaled $140.3 million from the FHLB and borrowing commitments totaled $46.0 million |
Redeemable Subordinated Debentu
Redeemable Subordinated Debentures | 12 Months Ended |
Dec. 31, 2017 | |
Subordinated Borrowings [Abstract] | |
Redeemable Subordinated Debentures | Redeemable Subordinated Debentures On May 30, 2006, the Company established 1 ST Constitution Capital Trust II (“Trust II”), a Delaware business trust and wholly-owned subsidiary of the Company, for the sole purpose of issuing $18.0 million of trust preferred securities (the “Capital Securities”). Trust II utilized the $18.0 million in proceeds, along with $557,000 invested in Trust II by the Company, to purchase $18,557,000 of floating rate junior subordinated debentures issued by the Company and due to mature on June 15, 2036. The subordinated debentures carry a floating interest rate based on the three-month LIBOR plus 165 basis points ( 3.3447% at December 31, 2017 ). The Capital Securities were issued in connection with a pooled offering involving approximately 50 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The components of income tax expense (benefit) are summarized as follows for the years ended December 31, 2017, 2016 and 2015: (In thousands) 2017 2016 2015 Federal: Current $ 2,791 $ 3,360 $ 3,199 Deferred 496 269 8 Provisional remeasurement of deferred tax assets and liabilities 1,712 — — 4,999 3,629 3,207 State: Current 748 909 704 Deferred 124 85 151 872 994 855 $ 5,871 $ 4,623 $ 4,062 A comparison of income tax expense at the Federal statutory rate in 2017 , 2016 and 2015 to the Company’s provision for income taxes is as follows: (In thousands) 2017 2016 2015 Federal income tax $ 4,352 $ 4,729 $ 4,327 Add (deduct) effect of: State income taxes net of federal income tax effect 575 656 564 Tax-exempt interest income (728 ) (706 ) (724 ) Bank-owned life insurance (177 ) (187 ) (203 ) Executive compensation 139 — — Provisional remeasurement of federal deferred tax assets and liabilities 1,712 — — Other items, net (2 ) 131 98 Provision for income taxes $ 5,871 $ 4,623 $ 4,062 The tax effects of existing temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are as follows at December 31, 2017, 2016 and 2015: (In thousands) 2017 2016 Deferred tax assets: Allowance for loan losses $ 2,253 $ 2,993 Unrealized loss on securities available for sale 137 130 Supplemental executive retirement plan liability 1,213 1,886 Other than temporary impairment loss 119 170 Depreciation 622 802 Non-accrual interest 330 313 Other 147 262 Total gross deferred tax assets $ 4,821 $ 6,556 Deferred tax liabilities: Deferred costs 540 — Pension liability 31 44 Acquisition accounting adjustments 44 52 Total gross deferred tax liabilities $ 615 $ 96 Net deferred tax assets $ 4,206 $ 6,460 Based upon the current facts, management has determined that it is more likely than not that there will be sufficient taxable income in future years to realize the deferred tax assets. However, there can be no assurances about the level of future earnings. On December 22, 2017, the Tax Cuts and Jobs Act (the "Tax Act") was signed into law. ASC 740 (Income Taxes) requires the recognition of the effect of changes in tax laws or rates in the period in which the legislation is enacted. The changes in the deferred tax assets and liabilities remeasured at the new 21% federal tax rate are reflected in income tax expense for fiscal year 2017. The Company performed a preliminary analysis and expensed an estimated $1.7 million |
Comprehensive Income and Accumu
Comprehensive Income and Accumulated Other Comprehensive Loss | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Comprehensive Income and Accumulated Other Comprehensive Loss | Comprehensive Income and Accumulated Other Comprehensive Loss Comprehensive income is the total of net income and all other changes in equity from non-shareholder sources, which are referred to as other comprehensive income. The components of accumulated other comprehensive income (loss) that are included in shareholders' equity and the related tax effects are as follows at December 31, 2017 and 2016: 2017 (In thousands) Before-Tax Amount Income Tax Effect Net-of-Tax Amount Net unrealized holding loss on securities available for sale $ (571 ) $ 137 $ (434 ) Unrealized impairment loss on held to maturity security (501 ) 119 (382 ) Gains on unfunded pension liability 111 (31 ) 80 Total other comprehensive loss $ (961 ) $ 225 $ (736 ) 2016 Before-Tax Amount Income Tax Effect Net-of-Tax Amount Net unrealized holding loss on securities available for sale $ (464 ) $ 130 $ (334 ) Unrealized impairment loss on held to maturity security (501 ) 170 (331 ) Gains on unfunded pension liability 109 (44 ) 65 Total other comprehensive loss $ (856 ) $ 256 $ (600 ) Changes in the components of accumulated other comprehensive income (loss) are as follows and are presented net of tax: (In thousands) Unrealized Holding Gains (Losses) on Available for Sale Securities Unrealized Impairment Loss on Held to Maturity Security Unfunded Pension Liability Accumulated Other Comprehensive Income (Loss) Balance, December 31, 2014 $ 276 $ (331 ) $ 303 $ 248 Other comprehensive income (loss) before reclassifications (186 ) — (32 ) (218 ) Amounts reclassified from accumulated other comprehensive income — — (160 ) (160 ) Other comprehensive income (loss) (186 ) — (192 ) (378 ) Balance, December 31, 2015 90 (331 ) 111 (130 ) Other comprehensive income (loss) before reclassifications (424 ) — 52 (372 ) Amounts reclassified from accumulated other comprehensive income — — (98 ) (98 ) Other comprehensive loss (424 ) — (46 ) (470 ) Balance, December 31, 2016 (334 ) (331 ) 65 (600 ) Other comprehensive income (loss) before reclassifications 26 — 38 64 Amounts reclassified from accumulated other comprehensive income (55 ) — (36 ) (91 ) Reclassification of certain deferred tax effects (71 ) (51 ) 13 (109 ) Other comprehensive loss (100 ) (51 ) 15 (136 ) Balance, December 31, 2017 $ (434 ) $ (382 ) $ 80 $ (736 ) |
Benefit Plans
Benefit Plans | 12 Months Ended |
Dec. 31, 2017 | |
Retirement Benefits [Abstract] | |
Benefit Plans | Benefit Plans Retirement Savings Plan: The Bank has a 401(k) Plan (the "Plan") which covers substantially all employees with six months or more of service. The plan permits all eligible employees to make contributions to the Plan up to the IRS salary deferral limit. Under the Plan, the Bank provided a matching contribution of 50% , up to 6% of base compensation. Employer contributions to the Plan amounted to $353,000 , $272,000 and $274,000 in 2017 , 2016 and 2015 . Bank-Owned Life Insurance: In connection with the benefit plans, the Bank has life insurance policies on the lives of its executives, directors, officers and employees. The Bank is the owner and beneficiary of the policies. The cash surrender values of the policies totaled approximately $25.1 million and $22.2 million as of December 31, 2017 and 2016 , respectively. Supplemental Executive Retirement Plan The Company also provides retirement benefits to certain employees under supplemental executive retirement plans (the "Supplemental Plans"). The Supplemental Plans are unfunded and the Company accrues actuarially determined benefit costs over the estimated service period of the employees participating in the Supplemental Plans. The present value of the benefits accrued under the Supplemental Plans as of December 31, 2017 and 2016 is approximately $4.2 million and $4.6 million , respectively, and is included in other liabilities and accumulated other comprehensive income in the accompanying consolidated balance sheets. Compensation expense related to the Supplemental Plans of $293,000 , $235,000 and $184,000 is included in the accompanying consolidated statements of income for the years ended December 31, 2017 , 2016 and 2015 , respectively. The following table sets forth the changes in benefit obligations of the Company’s Supplemental Plans for the years ended December 31, 2017 and 2016. (In thousands) 2017 2016 Change in Benefit Obligation Beginning January 1 $ 4,613 $ 4,971 Service cost 197 216 Interest cost 156 179 Actuarial gain (62 ) (83 ) Benefits paid (699 ) (670 ) Ending December 31 $ 4,205 $ 4,613 Amount Recognized in Consolidated Balance Sheets Liability for pension $ 4,316 $ 4,722 Net actuarial gain included in accumulated other comprehensive income (111 ) (109 ) Net recognized pension liability $ 4,205 $ 4,613 Information for pension plans with an accumulated benefit obligation in excess of plan assets Projected benefit obligation $ 4,205 $ 4,613 Accumulated benefit obligation 4,043 4,463 The following table sets forth the components of net periodic benefit cost for the years ended December 31, 2017, 2016 and 2015. (In thousands) 2017 2016 2015 Service cost $ 197 $ 216 $ 267 Interest cost 156 179 183 Recognized net actuarial gain (60 ) (160 ) (266 ) Net periodic benefit cost $ 293 $ 235 $ 184 The net periodic benefit cost is projected to be $193,000 and actuarial gains of $111,000 are expected to be removed from accumulated other comprehensive income and recognized as a component of net periodic benefit expense for the year ending December 31, 2018. For each of the years ended December 31, 2017 , 2016 and 2015 , the weighted-average discount rate was 4% and the assumed salary increase was 4% for each of the same years. Management's expectation as of December 31, 2017 for the projected annual benefit payments is represented in the table below. (In thousands) 2018 $ 4,509 2019 — 2020 — 2021 — 2022 — Thereafter — $ 4,509 |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Compensation | Share - Based Compensation The Company’s stock-based incentive plans (the “Stock Plans”) authorize the issuance of an aggregate of 485,873 shares of the Company’s common stock (as adjusted for stock dividends) pursuant to awards that may be granted in the form of stock options to purchase common stock (“Options”) and awards of shares of common stock (“Stock Awards”). The purpose of the Stock Plans is to attract and retain personnel for positions of substantial responsibility and to provide additional incentive to certain officers, directors, employees and other persons to promote the success of the Company. Under the Stock Plans, options have a term of ten years after the date of grant, subject to earlier termination in certain circumstances. Options are granted with an exercise price at the then fair market value of the Company’s common stock. The grant date fair value is calculated using the Black-Scholes option valuation model. As of December 31, 2017 , there were 127,736 shares of common stock available for future grants under the Stock Plans. Share-based compensation expense related to stock options was $65,000 , $44,000 and $41,000 for the years ended December 31, 2017 , 2016 and 2015 , respectively. As of December 31, 2017 , there was approximately $59,000 of unrecognized compensation cost related to non-vested stock option-based compensation arrangements granted under the Stock Plans that is expected to be recognized over the next four years. Transactions under the Company’s stock option plans during the year ended December 31, 2017 are summarized as follows: Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value (In thousands) Balance, January 1, 2017 165,819 $ 7.35 5.2 $ 1,882 Granted 9,900 18.65 Exercised (31,640 ) 8.05 Forfeited (1,030 ) 14.57 Expired (1,044 ) 14.86 Balance, December 31, 2017 142,005 $ 7.86 4.4 $ 1,486 Exercisable at December 31, 2017 124,141 $ 6.96 3.9 $ 1,408 The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value (the difference between market value of the Company's common stock on the last trading day of 2017 and the exercise price). The Company's closing stock price on December 31, 2017 was $18.30 . During the year ended December 31, 2017, the aggregate intrinsic value of stock options exercised was $304,000 and the Company received cash totaling $262,000 for options exercised. The following table summarizes stock options outstanding and exercisable at December 31, 2017: Outstanding Options Exercisable Options Exercise Price Range Number Average Life in Years Average Exercise Price Number Average Life in Years Average Exercise Price $5.54 to $5.63 50,975 3.8 $ 5.60 50,975 3.8 $ 5.60 $6.16 to $7.46 57,688 3.1 6.98 57,688 3.1 6.98 $9.30 to $11.98 24,442 7.1 10.70 13,698 6.8 10.43 $18.65 8,900 9.0 18.65 1,780 9.0 18.65 142,005 4.4 $ 7.86 124,141 3.9 $ 6.96 The fair value of each option and the significant weighted average assumptions used to calculate the fair value of the options granted during the years ended December 31, 2017 , 2016 and 2015 are as follows: 2017 2016 2015 Fair value of options granted $ 6.05 $ 4.65 $ 4.05 Risk-free rate of return 2.45 % 2.25 % 1.37 % Expected option life in years 7 7 7 Expected volatility 31.25 % 30.66 % 32.37 % Expected dividends (1) 1.19 % — % — % The following table summarizes the activity in nonvested restricted shares for the year ended December 31, 2017 : Number of Shares Weighted Average Grant-Date Fair Value Balance, January 1, 2017 146,639 $ 9.02 Granted 61,900 17.96 Vested (56,507 ) 10.60 Forfeited (1,287 ) 12.49 Balance, December 31, 2017 150,745 $ 11.87 The value of restricted shares is based upon the market value of the common stock on the date of grant. The shares generally vest over a four year service period with compensation expense recognized on a straight-line basis. Share-based compensation expense related to stock grants was $934,000 , $710,000 and $590,000 for the years ended December 31, 2017 , 2016 and 2015, respectively. As of December 31, 2017 , there was approximately $1.5 million of unrecognized compensation cost related to non-vested stock grants that will be recognized over the next three |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies As of December 31, 2017 , future minimum rental payments under non-cancelable operating leases were as follows: (In thousands) 2018 $ 1,281 2019 1,115 2020 910 2021 821 2022 710 Thereafter 2,675 $ 7,512 Rent expense aggregated $1.5 million for each of the years ended December 31, 2017 , 2016 and 2015 . Commitments With Off-Balance Sheet Risk: The consolidated balance sheet does not reflect various commitments relating to financial instruments which are used in the normal course of business. Management does not anticipate that the settlement of those financial instruments will have a material adverse effect on the Company’s financial condition. These instruments include commitments to extend credit and letters of credit. These financial instruments carry various degrees of credit risk, which is defined as the possibility that a loss may occur from the failure of another party to perform according to the terms of the contract. As these off-balance sheet financial instruments have essentially the same credit risk involved in extending loans, the Company generally uses the same credit and collateral policies in making these commitments and conditional obligations as it does for on-balance sheet investments. Additionally, as some commitments and conditional obligations are expected to expire without being drawn or returned, the contractual amounts do not necessarily represent future cash requirements. Commitments to extend credit are legally binding loan commitments with set expiration dates. They are intended to be disbursed, subject to certain conditions, upon request of the borrower. The Company receives a fee for providing a commitment. The Company was committed to advance $57.5 million and $42.6 million for loans that have not closed and $387.6 million and $330.1 million for lines of credit on closed loans as of December 31, 2017 and 2016 , respectively. The Company issues financial standby letters of credit that are within the scope of ASC Topic 460, “Guarantees.” These are irrevocable undertakings by the Company to guarantee payment of a specified financial obligation. Most of the Company’s financial standby letters of credit arise in connection with lending relationships and have terms of one year or less. The maximum potential future payments that the Company could be required to make under these standby letters of credit amounted to $1.2 million at December 31, 2017 and $2.0 million at December 31, 2016 . The current amount of the liability as of December 31, 2017 and 2016 for guarantors under standby letters of credit is not material. The Company also enters into best efforts forward sales commitments to sell residential mortgage loans that it has closed (loans held for sale) or that it expects to close (commitments to originate loans held for sale). These commitments are used to reduce the Company’s market price risk during the period from the commitment date to the sale date. The notional amount of the Company’s forward sales commitments was approximately $7.9 million at December 31, 2017 and $8.3 million at December 31, 2016 . The fair value of the loan origination commitments was $135,000 at December 31, 2017 and $123,000 at December 31, 2016 . Litigation: |
Other Operating Expenses
Other Operating Expenses | 12 Months Ended |
Dec. 31, 2017 | |
Other Income and Expenses [Abstract] | |
Other Operating Expenses | Other Operating Expenses The components of other operating expenses for the years ended December 31, 2017 , 2016 and 2015 are as follows: (Dollars in thousands) 2017 2016 2015 Regulatory, professional and other consulting fees $ 2,263 $ 1,706 $ 1,681 Equipment 1,008 917 939 Telephone 389 377 449 Amortization of intangible assets 384 404 428 Insurance 373 303 324 Merger-related expenses 265 — — Supplies 259 219 248 Marketing 225 240 282 Other expenses 2,151 1,535 1,540 $ 7,317 $ 5,701 $ 5,891 |
Regulatory Capital Requirements
Regulatory Capital Requirements | 12 Months Ended |
Dec. 31, 2017 | |
Banking and Thrift [Abstract] | |
Regulatory Capital Requirements | Regulatory Capital Requirements The Company and the Bank are subject to various regulatory capital requirements administered by the Federal and state banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory, and possibly additional discretionary, actions by regulators that, if undertaken, could have a direct material effect on the Company’s and the Bank’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and the Bank must meet specific capital guidelines that involve quantitative measures of the Company’s and the Bank’s assets, liabilities and certain off-balance sheet items as calculated under regulatory accounting practices. The Company’s and the Bank’s capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings and other factors. Quantitative measures established by regulation to ensure capital adequacy require the Company and the Bank to maintain minimum amounts and ratios of Common Equity Tier 1, Total and Tier I capital (as defined in the regulations) to risk-weighted assets (as defined) and Tier I capital to average assets (Leverage ratio, as defined). As of December 31, 2017 , the Company and the Bank met all capital adequacy requirements to which they are subject. To be categorized as adequately capitalized, the Company and the Bank must maintain minimum Common Equity Tier 1, Total capital to risk-weighted assets, Tier 1 capital to risk-weighted assets and Tier I leverage capital ratios as set forth in the below table. As of December 31, 2017 , the Bank's capital ratios exceeded the regulatory standards for well-capitalized institutions. Certain bank regulatory limitations exist on the availability of the Bank’s assets for the payment of dividends by the Bank without prior approval of bank regulatory authorities. In July 2013, the Federal Reserve Board and the FDIC approved revisions to their capital adequacy guidelines and prompt corrective action rules that implemented and addressed the revised standards of Basel III and addressed relevant provisions of the Dodd-Frank Act. The Federal Reserve Board’s final rules and the FDIC’s interim final rules (which became final in April 2014 with no substantive changes) apply to all depository institutions, top-tier bank holding companies with total consolidated assets of $500 million or more (which was subsequently increased to $1 billion or more in May 2015) and top-tier savings and loan holding companies (“banking organizations”). Among other things, the rules established a Common Equity Tier 1 minimum capital requirement (4.5% of risk-weighted assets) and increased the minimum Tier 1 capital to risk-based assets requirement (from 4% to 6% of risk-weighted assets). Banking organizations are also required to have a total capital ratio of at least 8% and a Tier 1 leverage ratio of at least 4%. The rules also limited a banking organization’s ability to pay dividends, engage in share repurchases or pay discretionary bonuses if the banking organization does not hold a “capital conservation buffer” consisting of 2.5% of Common Equity Tier 1 capital to risk-weighted assets in addition to the amount necessary to meet its minimum risk-based capital requirements. The rules became effective for the Company and the Bank on January 1, 2015. The capital conservation buffer requirement began phasing in on January 1, 2016 at 0.625% of Common Equity Tier 1 capital to risk-weighted assets and increases by that amount each year until fully implemented in January 2019 at 2.5% of Common Equity Tier 1 capital to risk-weighted assets. As of December 31, 2017, the Company and the Bank were required to maintain a capital conservation buffer of 1.25%. The Bank's actual capital amounts and ratios are presented in the following table: To Be Well Capitalized Under Prompt For Capital Corrective Actual Adequacy Purposes Action Provisions (Dollars in thousands) Amount Ratio Amount Ratio Amount Ratio As of December 31, 2017 Common equity Tier 1 $ 115,031 11.74 % $ 44,106 4.50 % $ 63,709 6.50 % Total capital to risk-weighted assets 123,044 12.55 % 78,411 8.00 % 98,014 10.00 % Tier 1 capital to risk-weighted assets 115,031 11.74 % 58,808 6.00 % 78,411 8.00 % Tier 1 leverage capital 115,031 10.96 % 41,987 4.00 % 52,484 5.00 % As of December 31, 2016 Common equity Tier 1 $ 108,606 12.13 % $ 40,302 4.50 % $ 58,214 6.50 % Total capital to risk-weighted assets 116,100 12.96 % 71,648 8.00 % 89,560 10.00 % Tier 1 capital to risk-weighted assets 108,606 12.13 % 53,736 6.00 % 71,648 8.00 % Tier 1 leverage capital 108,606 10.68 % 40,658 4.00 % 50,823 5.00 % The Company's actual capital amounts and ratios are presented in the following table: To Be Well Capitalized Under Prompt For Capital Corrective Actual Adequacy Purposes Action Provisions (Dollars in thousands) Amount Ratio Amount Ratio Amount Ratio As of December 31, 2017 Common equity Tier 1 $ 99,839 10.19 % $ 44,106 4.50 % N/A N/A Total capital to risk-weighted assets 125,852 12.84 % 78,411 8.00 % N/A N/A Tier 1 capital to risk-weighted assets 117,839 12.02 % 58,808 6.00 % N/A N/A Tier 1 leverage capital 117,839 11.23 % 41,987 4.00 % N/A N/A As of December 31, 2016 Common equity Tier 1 $ 93,101 10.40 % $ 40,302 4.50 % N/A N/A Total capital to risk-weighted assets 118,595 13.24 % 71,648 8.00 % N/A N/A Tier 1 capital to risk-weighted assets 111,101 12.41 % 53,736 6.00 % N/A N/A Tier 1 leverage capital 111,101 10.93 % 40,658 4.00 % N/A N/A Dividend payments by the Bank to the Company are subject to the New Jersey Banking Act of 1948, as amended (the “Banking Act”) and the Federal Deposit Insurance Act, as amended (the “FDIA”). Under the Banking Act, the Bank may not pay dividends unless, following the dividend payment, the capital stock of the Bank will be unimpaired and (i) the Bank will have a surplus of not less than 50% of its capital stock or, if not, (ii) the payment of such dividend will not reduce the surplus of the Bank. Under the FDIA, the Bank may not pay any dividends if after paying the dividend, it would be undercapitalized under applicable capital requirements. In addition to these explicit limitations, the federal regulatory agencies are authorized to prohibit a banking subsidiary or bank holding company from engaging in an unsafe or unsound banking practice. Depending upon the circumstances, the agencies could take the position that paying a dividend would constitute an unsafe or unsound banking practice. The Bank is also limited in paying dividends if it does not maintain the necessary “capital conservation buffer” as discussed below. It is the policy of the Federal Reserve Board that bank holding companies should pay cash dividends on common stock only out of income available over the immediately preceding year and only if prospective earnings retention is consistent with the organization’s expected future needs and financial condition. The policy provides that bank holding companies should not maintain a level of cash dividend that undermines the bank holding company’s ability to serve as a source of strength to its banking subsidiary. A bank holding company may not pay dividends when it is insolvent. The Company's payment of cash dividends to date were within the guidelines set forth in the Federal Reserve Board's policy. |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Dec. 31, 2017 | |
Stockholders' Equity Note [Abstract] | |
Shareholders' Equity | Shareholders’ Equity The Company issued a warrant on December 23, 2008 to the United States Department of the Treasury (the “Treasury”) under the Troubled Asset Relief Program (“TARP”) Capital Purchase Program (the “CPP”). This warrant was sold by the Treasury on November 23, 2011 and exchanged for two new warrants which permit the holders thereof to acquire, on an adjusted basis resulting from declarations of stock and cash dividends to holders of common stock since the issuance of the two warrants, 286,174 shares of common stock of the Company at a price of $6.291 per share. Certain terms and conditions of the warrant issued to the Treasury were modified or deleted in the two new warrants, including, without limitation, the deletion of the anti-dilution provision upon certain issuances of the Company’s common stock at or below a specified price relative to the initial exercise price. However, the two warrants still provide for the adjustment of the exercise price and the number of shares of the Company’s common stock issuable upon exercise pursuant to customary anti-dilution provisions, such as upon stock splits or distributions of securities or other assets to holders of the Company’s common stock. The two warrants remain outstanding, are immediately exercisable and continue to have an expiration date of December 23, 2018, which was the expiration date of the warrant originally issued to the Treasury. The Board of Governors of the Federal Reserve System has issued a supervisory letter to bank holding companies that contains guidance on when the board of directors of a bank holding company should eliminate or defer or severely limit dividends, including, for example, when net income available for shareholders for the past four quarters, net of dividends paid during that period, is not sufficient to fully fund the dividends. The letter also contains guidance on the redemption of stock by bank holding companies which urges bank holding companies to advise the Federal Reserve of any such redemption or repurchase of common stock for cash or other value which results in the net reduction of a bank holding company’s capital at the beginning of the quarter below the capital outstanding at the end of the quarter. The Company's payment of cash dividends to date were within the guidelines set forth in the Federal Reserve Board's supervisory letter. On January 21, 2016, the Board of Directors of the Company authorized a new common stock repurchase program. Under the new common stock repurchase program, the Company may purchase in open market or privately negotiated transactions up to five ( 5% ) percent of its common shares outstanding on the date of the approval of the stock repurchase program, which limitation will be adjusted for any future stock dividends. This new repurchase program replaced the repurchase program authorized on August 3, 2005. The Company repurchased no shares during the year ended December 31, 2017, while during the years ended December 31, 2016 and 2015, the Company repurchased 2,000 shares for an aggregate price of approximately $24,000 and 31,050 shares for an aggregate price of approximately $359,000 |
Fair Value Disclosures
Fair Value Disclosures | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Disclosures | Fair Value Disclosures U.S. GAAP has established a fair value hierarchy that prioritizes the inputs to valuation methods used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows: Level 1. Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. Level 2. Quoted prices in markets that are not active, or inputs that are observable either directly or indirectly, for substantially the full term of the asset or liability. Level 3. Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported with little or no market activity). An asset’s or liability’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. A description of the valuation methodologies used for instruments measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy, is set forth below. These valuation methodologies were applied to all of the Company’s financial assets and financial liabilities carried at fair value. In general, fair value is based upon quoted market prices, where available. If such quoted market prices are not available, fair value is based upon internally developed models that primarily use, as inputs, observable market-based parameters. Valuation adjustments may be made to ensure that financial instruments are recorded at fair value. These adjustments may include amounts to reflect counterparty credit quality and counterparty creditworthiness, among other things, as well as unobservable parameters. Any such valuation adjustments are applied consistently over time. The Company’s valuation methodologies may produce a fair value calculation that may not be indicative of net realizable value or reflective value or reflective of future values. While management believes that the Company’s valuation methodologies are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different estimate of fair value at the reporting date. Securities Available for Sale: Securities classified as available for sale are reported at fair value utilizing Level 1 and Level 2 inputs. For Level 2 securities, the fair value measurements consider observable data that may include dealer quotes, market spreads, cash flows, the U.S. Treasury yield curve, live trading levels, trade execution data, market consensus prepayment speeds, credit information and the security’s terms and conditions, among other things. Impaired loans: Loans included in the following table are those which the Company has measured and recognized impairment based generally on the fair value of the loan’s collateral. Fair value is generally determined based upon independent third party appraisals of the properties or discounted cash flows based on the expected proceeds. These assets are included as Level 3 fair values based upon the lowest level of input that is significant to the fair value measurements. The fair value consists of the loan balances less specific valuation allowances. The following table summarizes financial assets and financial liabilities measured at fair value on a recurring basis, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value: December 31, 2017 (In thousands) Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Fair Value Securities available for sale: U.S. Treasury Securities and obligations of U.S. Government sponsored corporations ("GSE") $ — $ 1,967 $ — $ 1,967 Residential collateralized mortgage obligations - GSE — 27,325 — 27,325 Residential mortgage backed securities-GSE — 14,288 — 14,288 Obligations of state and political subdivisions — 19,720 — 19,720 Trust preferred debt securities - single issuer — 2,349 — 2,349 Corporate debt securities 16,080 11,603 — 27,683 Other debt securities — 12,126 — 12,126 Total $ 16,080 $ 89,378 $ — $ 105,458 December 31, 2016 (In thousands) Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Fair Value Securities available for sale: U.S. Treasury Securities and obligations of U.S Government sponsored corporations (“GSE”) $ — $ 3,479 $ — $ 3,479 Residential collateralized mortgage obligations - GSE — 22,560 — 22,560 Residential mortgage backed securities – GSE — 31,476 — 31,476 Obligations of state and political subdivisions — 21,400 — 21,400 Trust preferred debt securities - single issuer — 2,272 — 2,272 Corporate debt securities 12,826 8,942 — 21,768 Other debt securities — 839 — 839 Total $ 12,826 $ 90,968 $ — $ 103,794 Certain financial assets and financial liabilities are measured at fair value on a nonrecurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment). Financial assets and financial liabilities measured at fair value on a non-recurring basis at December 31, 2017 and 2016 are as follows: (In thousands) Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Fair Value December 31, 2017 Impaired loans — — $ 8,313 $ 8,313 December 31, 2016 Impaired loans — — $ 4,130 $ 4,130 Impaired loans, measured at fair value and included in the above table, consisted of 14 loans having an aggregate balance of $9.0 million and specific loan loss allowances of $684,000 at December 31, 2017 and 9 loans having an aggregate balance of $4.4 million and specific loan loss allowances of $260,000 at December 31, 2016 . The following table presents additional qualitative information about assets measured at fair value on a non-recurring basis and for which the Company has utilized Level 3 inputs to determine fair value: (Dollars in thousands) Fair Value Estimate Valuation Techniques Unobservable Input Range (Weighted Average) December 31, 2017 Impaired loans $ 8,313 Appraisal of collateral (1) Appraisal adjustments (2) 0.5%-100% (28.2%) December 31, 2016 Impaired loans $ 4,130 Appraisal of collateral (1) Appraisal adjustments (2) 3%-100% (29.1%) (1) Fair value is generally determined through independent appraisals of the underlying collateral, which generally include various Level 3 inputs that are not identifiable. (2) Includes qualitative adjustments by management and estimated liquidation expenses. The following is a summary of the fair value and the carrying value of all of the Company’s financial instruments. For the Company and the Bank, as for most financial institutions, the bulk of assets and liabilities are considered financial instruments. Many of the financial instruments lack an available trading market as characterized by a willing buyer and willing seller engaging in an exchange transaction. Therefore, significant estimations and present value calculations are used. Changes in assumptions could significantly affect these estimates. Estimated fair values have been determined by using the best available data and an estimation methodology suitable for each category of financial instruments as follows: Cash and Cash Equivalents, Accrued Interest Receivable and Accrued Interest Payable: The carrying amounts reported on the balance sheet for cash and cash equivalents, accrued interest receivable and accrued interest payable approximate fair value. Securities Held to Maturity: The fair values of securities held to maturity are determined in the same manner as for securities available for sale. Loans Held For Sale: The fair values of loans held for sale are determined, when possible, using prices based on the best efforts commitment by the purchaser of the loan or quoted secondary market prices. If no such quoted market prices exist, fair values are determined using quoted prices for similar loans, adjusted for the specific attributes of the loans. SBA servicing asset: Servicing assets do not trade in an active market with readily observable prices. The Company estimates the fair value of the SBA servicing asset using a discounted cash flow model, which incorporates assumptions based on observable discount rates and prepayment speeds. Interest rate lock derivatives: Interest rate lock commitments do not trade in active markets with readily observable prices. The fair value of the interest rate lock commitments is estimated based upon the forward sales price that is obtained in the best efforts commitment at the time the borrower locks in the interest rate on the loan and the probability that the locked rate commitment will close. Federal Home Loan Bank Stock: FHLB stock is carried at cost. The carrying value approximates fair value based upon the redemption price provision of the FHLB stock. Gross Loans Receivable: The fair values of loans, excluding impaired loans subject to specific loss reserves, are estimated using discounted cash flow analyses and market rates at the balance sheet date that reflect the credit and interest rate-risk inherent in the loans. Projected future cash flows are calculated based upon contractual maturity or call dates, projected repayments and prepayments of principal. Generally, for variable rate loans that re-price frequently and with no significant change in credit risk, fair values are based on carrying values. Deposit Liabilities: The fair values disclosed for demand deposits (e.g., interest and non-interest demand and savings accounts) are, by definition, equal to the amount payable on demand at the reporting date (i.e., their carrying amounts). Fair values of certificates of deposit are estimated using a discounted cash flow calculation that applies interest rates currently being offered in the market on certificates to a schedule of aggregated expected monthly maturities on time deposits. Borrowings and Subordinated Debentures: The carrying amounts of short-term borrowings approximate their fair values. The fair values of long-term FHLB advances and subordinated debentures are estimated using discounted cash flow analysis, based on quoted or estimated interest rates for new borrowings with similar credit risk characteristics, terms and remaining maturity. The fair values and the carrying value of financial instruments at December 31, 2017 and 2016 were as follows: 2017 (In thousands) Carrying Value Level 1 Inputs Level 2 Inputs Level 3 Inputs Fair Value Cash and cash equivalents $ 18,754 $ 18,754 $ — $ — $ 18,754 Securities available for sale 105,458 16,080 89,378 — 105,458 Securities held to maturity 110,267 — 111,865 — 111,865 Loans held for sale 4,254 — 4,539 — 4,539 Loans 789,906 — — 784,064 784,064 SBA servicing asset 726 — 1,016 — 1,016 Interest rate lock derivative 135 — 135 — 135 Accrued interest receivable 3,478 — 3,478 — 3,478 FHLB Stock 1,490 — 1,490 — 1,490 Deposits (922,006 ) — (920,732 ) — (920,732 ) Borrowings (20,500 ) — (20,500 ) — (20,500 ) Redeemable subordinated debentures (18,557 ) — (12,326 ) — (12,326 ) Accrued interest payable (804 ) — (804 ) — (804 ) 2016 (In thousands) Carrying Value Level 1 Inputs Level 2 Inputs Level 3 Inputs Fair Value Cash and cash equivalents $ 14,886 $ 14,886 $ — $ — $ 14,886 Securities available for sale 103,794 12,826 90,968 — 103,794 Securities held to maturity 126,810 — 128,559 — 128,559 Loans held for sale 14,829 — 15,103 — 15,103 Loans 724,808 — — 716,492 716,492 SBA servicing asset 605 — 822 — 822 Interest rate lock derivative 123 — 123 — 123 Accrued interest receivable 3,095 — 3,095 — 3,095 FHLB Stock 3,962 — 3,962 — 3,962 Deposits (834,516 ) — (834,050 ) — (834,050 ) Borrowings (73,050 ) — (73,222 ) — (73,222 ) Redeemable subordinated debentures (18,557 ) — (11,922 ) — (11,922 ) Accrued interest payable (866 ) — (866 ) — (866 ) Loan commitments and standby letters of credit as of December 31, 2017 and 2016 |
Parent-only Financial Informati
Parent-only Financial Information | 12 Months Ended |
Dec. 31, 2017 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Parent-only Financial Information | Parent-only Financial Information The condensed financial statements of 1 ST Constitution Bancorp (parent company only) are presented below: 1 ST CONSTITUTION BANCORP Condensed Statements of Financial Condition (Dollars in Thousands) December 31, 2017 2016 Assets : Cash $ 317 $ 490 Investment securities 557 557 Investment in subsidiary 126,846 120,306 Other assets 2,519 2,451 Total Assets $ 130,239 $ 123,804 Liabilities And Shareholders’ Equity Other liabilities $ 29 $ 446 Subordinated debentures 18,557 18,557 Shareholders’ equity 111,653 104,801 Total Liabilities and Shareholders’ Equity $ 130,239 $ 123,804 1 ST CONSTITUTION BANCORP Consolidated Statements of Income and Comprehensive Income (Dollars in Thousands) Year ended December 31, 2017 2016 2015 Income: Interest income $ 16 $ 13 $ 11 Dividend income from subsidiary 1,826 1,240 366 Total Income 1,842 1,253 377 Expense: Interest expense 535 440 366 Total Expense 535 440 366 Income before income taxes and equity in undistributed income of subsidiaries 1,307 813 11 Income tax benefit (177 ) (146 ) (122 ) Income before equity in undistributed income of subsidiaries 1,484 959 133 Equity in undistributed income of subsidiaries 5,444 8,326 8,531 Net Income 6,928 9,285 8,664 Equity in other comprehensive loss of subsidiaries (27 ) (470 ) (378 ) Comprehensive Income 6,901 8,815 8,286 1 ST CONSTITUTION BANCORP Condensed Statements of Cash Flows (Dollars in Thousands) Year Ended December 31, 2017 2016 2015 Operating Activities: Net Income $ 6,928 $ 9,285 $ 8,664 Adjustments: Increase in other assets (68 ) (126 ) (92 ) (Decrease) increase in other liabilities (16 ) 408 — Equity in undistributed income of subsidiaries (5,444 ) (8,326 ) (8,531 ) Net cash provided by operating activities 1,400 1,241 41 Cash Flows From Investing Activities: Investment in subsidiary (130 ) (501 ) 37 Net cash (used in) provided by investing activities (130 ) (501 ) 37 Cash Flows From Financing Activities: Cash dividend paid (1,690 ) (399 ) — Exercise of stock options 247 96 292 Purchase of treasury stock, net — (24 ) (359 ) Net cash used in financing activities (1,443 ) (327 ) (67 ) Net (decrease) increase in cash (173 ) 413 11 Cash at beginning of year 490 77 66 Cash at end of year $ 317 $ 490 $ 77 |
Quarterly Financial Data (Unaud
Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Data (Unaudited) | Quarterly Financial Data (Unaudited) The following table sets forth a condensed summary of the Company’s quarterly results of operations for the years ended December 31, 2017 , 2016 and 2015 . Selected 2017 Quarterly Data (Dollars in thousands, except per share data) December 31 September 30 June 30 March 31 Interest income $ 11,227 $ 10,811 $ 10,142 $ 9,483 Interest expense 1,418 1,451 1,340 1,289 Net interest income 9,809 9,360 8,802 8,194 Provision for loan losses 150 150 150 150 Net interest income after provision for loan losses 9,659 9,210 8,652 8,044 Non-interest income 1,930 2,112 1,785 2,413 Non-interest expense 8,064 7,609 7,677 7,656 Income before income taxes 3,525 3,713 2,760 2,801 Income taxes 2,951 1,227 841 852 Net income $ 574 $ 2,486 $ 1,919 $ 1,949 Net income per common share: (1) Basic $ 0.07 $ 0.31 $ 0.24 $ 0.24 Diluted 0.07 0.30 0.23 0.23 Selected 2016 Quarterly Data (Dollars in thousands, except per share data) December 31 September 30 June 30 March 31 Interest income $ 9,983 $ 10,399 $ 9,476 $ 9,277 Interest expense 1,361 1,355 1,257 1,185 Net interest income 8,622 9,044 8,219 8,092 Provision for loan losses — — (100 ) (200 ) Net interest income after provision for loan losses 8,622 9,044 8,319 8,292 Non-interest income 2,010 1,769 1,548 1,595 Non-interest expense 7,572 6,662 6,440 6,617 Income before income taxes 3,060 4,151 3,427 3,270 Income taxes 1,006 1,456 1,113 1,048 Net income $ 2,054 $ 2,695 $ 2,314 $ 2,222 Net income per common share: (1) Basic $ 0.26 $ 0.34 $ 0.29 $ 0.28 Diluted 0.25 0.33 0.28 0.27 Selected 2015 Quarterly Data (Dollars in thousands, except per share data) December 31 September 30 June 30 March 31 Interest income $ 9,467 $ 10,422 $ 10,143 $ 9,291 Interest expense 1,170 1,169 1,153 1,144 Net interest income 8,297 9,253 8,990 8,147 Provision for loan losses 500 100 — 500 Net interest income after provision for loan losses 7,797 9,153 8,990 7,647 Non-interest income 926 1,436 2,046 2,178 Non-interest expense 6,349 6,979 7,609 6,510 Income before income taxes 2,374 3,610 3,427 3,315 Income taxes 747 1,148 1,112 1,055 Net income $ 1,627 $ 2,462 $ 2,315 $ 2,260 Net income per common share: (1) Basic $ 0.21 $ 0.31 $ 0.29 $ 0.29 Diluted 0.20 0.30 0.29 0.28 (1) |
Subsequent Event
Subsequent Event | 12 Months Ended |
Dec. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Event | Subsequent Event On November 6, 2017, the Company and the Bank entered into an Agreement and Plan of Merger (the "Merger Agreement") with New Jersey Community Bank ("NJCB"), providing for the merger of NJCB with and into the Bank, with the Bank as the surviving entity (the "Merger"). If the Merger is completed, shareholders of NJCB will be entitled to receive, for each outstanding share of NJCB common stock that they own at the effective time of the Merger, a combination of common stock of the Company and cash as follows: (i) 0.1309 of a share of common stock of the Company, subject to the payment of cash in lieu of fractional shares, which stock exchange ratio was based on the average closing price of $19.25 for a share of common stock of the Company during the measurement period specified in the Merger Agreement; and (ii) $1.60 in cash, subject to $0.21 being placed in escrow in accordance with the terms and conditions of the Merger Agreement to cover costs and expenses that may be incurred by the Company after the effective time of the Merger as a result of specific pending litigation against NJCB. The Company and the Bank have submitted and received all required regulatory approvals and waivers. The Company has filed a registration statement on Form S-4, which includes a proxy statement of NJCB and a prospectus of the Company, with the SEC to register shares of common stock of the Company to be issued to shareholders of NJCB. The registration statement on Form S-4 was declared effective on February 15, 2018 by the SEC and the proxy statement-prospectus was mailed to shareholders of NJCB on or about February 22, 2018. The closing of the Merger remains subject to a number of conditions, including approval of the Merger Agreement by NJCB shareholders at a special meeting of shareholders scheduled to be held on March 22, 2018. The closing of the Merger is anticipated to take place during the second quarter of 2018. On December 31, 2017, NJCB had approximately $103.1 million in assets, approximately $79.0 million in loans, approximately $93.7 million in deposits and approximately $8.9 million in shareholders' equity. NJCB operates two |
Summary of Significant Accoun32
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Basis of Financial Statement Presentation | Basis of Financial Statement Presentation: |
Use of Estimates in the Preparation of Financial Statements | In preparing the financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the balance sheet and revenues and expenses for that period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance for loan losses, other-than-temporary security impairment, the fair value of other real estate owned, if any, and the valuation of deferred tax assets. |
Principles of Consolidation | Principles of Consolidation: |
Concentration of Credit Risk | Concentration of Credit Risk: Financial instruments which potentially subject the Company and its subsidiaries to concentrations of credit risk primarily consist of investment securities and loans. At December 31, 2017 , 41.5% of our investment securities portfolio consisted of U.S. Government and Agency issues and collateralized mortgage obligations collateralized by agency mortgage backed securities. In addition, 38.7% of the portfolio consisted of municipal bonds. The remaining 19.8% |
Interest Rate Risk | Interest Rate Risk: The Bank is principally engaged in the business of attracting deposits from the general public and using these deposits, together with other funds, to purchase investment securities and to make loans, the majority of which are secured by real estate. The potential for interest-rate risk exists as a result of the Company's generally shorter duration of interest-sensitive assets compared to the generally longer duration of interest-sensitive liabilities. In a changing interest rate environment, assets held by the Bank will re-price faster than liabilities of the Bank, thereby affecting net interest income. For this reason, management regularly monitors the maturity structure and rate adjustment features of the Bank’s assets and liabilities in order to measure its level of interest-rate risk and to plan for future volatility. |
Investment Securities | Investment Securities: Investment securities which the Company has the intent and ability to hold until maturity are classified as held to maturity and are recorded at cost, adjusted for amortization of premiums and accretion of discounts. Investment securities that are held for indefinite periods of time, that management intends to use as part of its asset/liability management strategy, or that may be sold in response to changes in interest rates, changes in prepayment risk, increased capital requirements or other similar factors, are classified as available for sale and are carried at fair value. Unrealized gains and losses on available for sale securities are recorded as a separate component of shareholders’ equity. Realized gains and losses, which are computed using the specific identification method, are recognized in earnings on a trade date basis. If the fair value of a security is less than its amortized cost, the security is deemed to be impaired. Management evaluates all securities with unrealized losses quarterly to determine if such impairments are temporary or other-than-temporary in accordance with the Accounting Standards Codification (“ASC”) of the Financial Accounting Standards Board (“FASB”). Temporary impairments on available for sale securities are recognized, on a tax-effected basis, through other comprehensive income (“OCI”) with offsetting adjustments to the carrying value of the security and the balance of related deferred taxes. Temporary impairments of held to maturity securities are not recorded in the consolidated financial statements; however, information concerning the amount and duration of impairments on held to maturity securities are disclosed. Other-than-temporary impairments ("OTTI") on all equity securities and on debt securities that the Company has decided to sell, or will, more likely than not, be required to sell prior to the full recovery of fair value to a level equal to or exceeding amortized cost, are recognized in earnings. If neither of these conditions regarding the likelihood of sale for a debt security apply, the OTTI is bifurcated into credit-related and noncredit-related components. Credit-related impairment generally represents the amount by which the present value of the cash flows that are expected to be collected on a debt security fall below its amortized cost. The noncredit-related component represents the remaining portion of the impairment not otherwise designated as credit-related. The Company recognizes credit-related OTTI in earnings. Noncredit-related OTTI on debt securities are recognized in OCI. Premiums and discounts on all securities are amortized/accreted to maturity by use of the level-yield method considering the impact of principal amortization and prepayments. Federal law requires a member institution of the FHLB system to hold restricted stock of its district FHLB according to a predetermined formula. The Bank’s investment in the restricted stock of the FHLB of New York is carried at cost and is included in other assets. The investment in FHLB stock was $1.5 million and $4.0 million at December 31, 2017 and December 31, 2016 , respectively. The unrealized losses on investments in these securities were caused by increases in market interest rates. The contractual terms of these investments do not permit the issuer to settle the securities at a price less than the par value of the investment. The Company does not intend to sell these investments and it is not more likely than not that the Company will be required to sell these investments before a market price recovery or maturity. Therefore, these investments are not considered other-than temporarily impaired. Residential collateralized mortgage obligations and residential mortgage backed securities: The unrealized losses on investments in residential collateralized mortgage obligations and residential mortgage backed securities were caused by increases in market interest rates. The contractual cash flows of these securities are guaranteed by the issuer, primarily government or government sponsored agencies. It is expected that the securities would not be settled at a price less than the amortized cost of the investment. The Company does not intend to sell these investments and it is not more likely than not that the Company will be required to sell these investments before a market price recovery or maturity. Therefore, these investments are not considered other-than temporarily impaired. Obligations of state and political subdivisions: The unrealized losses on investments in these securities were caused by increases in market interest rates. It is expected that the securities would not be settled at a price less than the amortized cost of the investment. None of the issuers have defaulted on interest payments. These investments are not considered to be other than temporarily impaired because the decline in fair value is attributable to changes in interest rates and not credit quality. The Company does not intend to sell these investments and it is not more likely than not that the Company will be required to sell these investments before a market price recovery or maturity. Therefore, these investments are not considered other-than temporarily impaired. Trust preferred debt securities – single issuer : The investments in these securities are comprised of four corporate trust preferred securities issued by two large financial institutions that both mature in 2027. The contractual terms of the trust preferred securities do not allow the issuer to settle the securities at a price less than the face value of the trust preferred securities, which is greater than the amortized cost of the trust preferred securities. One of the issuers continues to maintain an investment grade credit rating and neither has defaulted on interest payments. The decline in fair value is attributable to the widening of interest rate spreads and the lack of an active trading market for these securities and, to a lesser degree, market concerns about the issuers’ credit quality. The Company does not intend to sell these investments and it is not more likely than not that the Company will be required to sell these investments before a market price recovery or maturity. Therefore, these investments are not considered other-than-temporarily impaired. Corporate debt securities . The unrealized losses on investments in corporate debt securities were caused by an increase in market interest rates. None of the corporate issuers have defaulted on interest payments. The decline in fair value is attributable to changes in market interest rates and not credit quality. The Company does not intend to sell these investments and it is not more likely than not that the Company will be required to sell these investments before a market price recovery or maturity. Therefore, these investments are not considered other-than-temporarily impaired. Trust preferred debt securities – pooled: This trust preferred debt security was issued by a two issuer pool (Preferred Term Securities XXV, Ltd. co-issued by Keefe, Bruyette and Woods, Inc. and First Tennessee (“PRETSL XXV”)), consisting primarily of financial institution holding companies. During 2009, the Company recognized an other-than-temporary impairment charge of $865,000 , of which $364,000 was determined to be a credit loss and charged to operations and $501,000 was recognized in the other comprehensive income (loss) component of shareholders’ equity. The primary factor used to determine the credit portion of the impairment loss to be recognized in the income statement for this security was the discounted present value of projected cash flow, where that present value of cash flow was less than the amortized cost basis of the security. The present value of cash flow was developed using a model that considered performing collateral ratios, the level of subordination to senior tranches of the security and credit ratings of and projected credit defaults in the underlying collateral. On a quarterly basis, management evaluates this security to determine if any additional other-than-temporary impairment is required. As of December 31, 2017 , management concluded that no additional other-than-temporary impairment had occurred. |
Bank-Owned Life Insurance | Bank-Owned Life Insurance: The Company invests in bank-owned life insurance (“BOLI”). BOLI involves the purchasing of life insurance by the Company on a select group of its executives, directors, officers and employees. The Company is the owner and beneficiary of the policies. This pool of insurance, due to the advantages of the Bank, is profitable to the Company. This profitability offsets a portion of current and future benefit costs and is intended to provide a funding source for the payment of future benefits. The Bank’s deposits fund BOLI and the earnings from BOLI are recognized as non-interest income. |
Loans and Loans Held For Sale | Loans and Loans Held For Sale: Loans that management intends to hold to maturity are stated at the principal amount outstanding, net of unearned income. Unearned income is recognized over the lives of the respective loans, principally using the effective interest method. Interest income is generally not accrued on loans, including impaired loans, where interest or principal is 90 days or more past due, unless the loans are adequately secured and in the process of collection, or on loans where management has determined that the borrowers may be unable to meet contractual principal and/or interest obligations. When it is probable that, based upon current information, the Bank will not collect all amounts due under the contractual terms of the loan, the loan is reported as impaired. Smaller balance homogeneous type loans, such as residential loans and loans to individuals, which are collectively evaluated, are generally excluded from consideration for impairment. Loan impairment is measured based upon the present value of the expected future cash flows discounted at the loan’s effective interest rate or the underlying fair value of collateral for collateral dependent loans. When a loan, including an impaired loan, is placed on non-accrual, interest accruals cease and uncollected accrued interest is reversed and charged against current income. Non-accrual loans are generally not returned to accruing status until principal and interest payments have been brought current and full collectibility is reasonably assured. Cash receipts on non-accrual and impaired loans are applied to principal, unless the loan is deemed fully collectible. Loans held for sale are carried at the lower of aggregated cost or fair value. The fair value of loans held for sale are determined, when possible, using quoted secondary market prices. If no such quoted market prices exist, fair values are determined using quoted prices for similar loans, adjusted for the specific attributes of the loans. Realized gains and losses on loans held for sale are recognized at settlement date and are determined based on the cost, including deferred net loan origination fees and the costs of the specific loans sold. Residential mortgage loans are sold with servicing released. The Bank accounts for its transfers and servicing of financial assets in accordance with ASC Topic 860, “Transfers and Servicing” ("ASC Topic 860"). The Bank originates residential mortgages under a definitive plan to sell those loans with servicing generally released. Residential mortgage loans originated and intended for sale in the secondary market are carried at the lower of aggregate cost or estimated fair value. The Bank also originates commercial loans, of which a portion are guaranteed by the Small Business Administration ("SBA"). The guaranteed portion of the loans is generally sold into the secondary market. Gains and losses on sales are also accounted for in accordance with ASC Topic 860. The Bank enters into commitments to originate loans whereby the interest rate on the loan is determined prior to funding “rate lock commitments.” Rate lock commitments on residential mortgage loans that are intended to be sold are considered to be derivatives. Time elapsing between the issuance of a loan commitment and closing and sale of the loan generally ranges from 30 to 120 days. The Bank protects itself from changes in interest rates through the use of best efforts forward delivery commitments, whereby the Bank commits to sell a loan at the time the borrower commits to an interest rate with the intent that the buyer has assumed interest rate risk on the loan. As a result, the Bank is generally not exposed to losses nor will it realize significant gains related to its rate lock commitments due to changes in interest rates. The fair value of rate lock commitments and best efforts commitments is not readily ascertainable with precision because rate lock commitments and best efforts commitments are not actively traded in stand-alone markets. The Bank determines the fair value of rate lock commitments based upon the forward sales price that is obtained in the best efforts commitment at the time the borrower locks in the interest rate on the loan while taking into consideration the probability that the rate lock commitments will close. Due to high correlation between rate lock commitments and best efforts commitments, no gain or loss occurs on the rate lock commitments. The estimated fair value of rate lock commitments was $135,000 and $123,000 at December 31, 2017 and 2016 , respectively. ASC Topic 460, "Guarantees," requires a guarantor entity, at the inception of a guarantee covered by the measurement provisions of the interpretation, to record a liability for the fair value of the obligation undertaken in issuing the guarantee. |
Allowance for Loan Losses | Allowance for Loan Losses: The allowance for loan losses is maintained at a level sufficient to absorb estimated credit losses in the loan portfolio as of the date of the financial statements. The allowance for loan losses is a valuation reserve available for losses incurred or inherent in the loan portfolio and other extensions of credit. The determination of the adequacy of the allowance for loan losses is a critical accounting policy of the Bank. All, or part, of the principal balance of commercial and commercial real estate loans and construction loans are charged off against the allowance as soon as it is determined that the repayment of all, or part, of the principal balance is highly unlikely. Consumer loans are generally charged off no later than 120 days past due on a contractual basis, or earlier in the event of bankruptcy, or if there is an amount deemed uncollectible . Because all identified losses are charged off, no portion of the allowance for loan losses is restricted to any individual loan or groups of loans, and the entire allowance is available to absorb any and all loan losses. Loans are placed in a nonaccrual status when the ultimate collectability of principal or interest in whole, or in part, is in doubt. Past-due loans contractually past-due 90 days or more for either principal or interest are also placed in nonaccrual status unless they are both well secured and in the process of collection. Impaired loans are evaluated individually. Purchased Credit-Impaired (“PCI”) loans are loans acquired at a discount that is due, in part, to credit quality. PCI loans are accounted for in accordance with ASC Subtopic 310-30, "Receivables, Loans and Debt Securities Acquired with Deteriorated Credit Quality" and are initially recorded at fair value (as determined by the present value of expected future cash flows) with no valuation allowance (i.e., the allowance for loan losses). The difference between the undiscounted cash flows expected at acquisition and the initial carrying amount (fair value) of the PCI loans or the “accretable yield,” is recognized as interest income utilizing the level-yield method over the life of the loans. Contractually required payments for interest and principal that exceed the undiscounted cash flows expected at acquisition, or the “non-accretable difference,” are not recognized as a yield adjustment, as a loss accrual or a valuation allowance. Reclassifications of the non-accretable difference to the accretable yield may occur subsequent to the loan acquisition dates due to increases in expected cash flows of the loans and result in an increase in yield on a prospective basis. The following is our charge-off policy for our loan segments: Commercial, Commercial Real Estate and Construction Loans are generally fully or partially charged down to the fair value of collateral securing the asset when: • Management judges the loan to be uncollectible; • Repayment is deemed to be protracted beyond reasonable time frames; • The loan has been classified as a loss by either internal loan review process or external examiners; • The customer has filed bankruptcy and the loss becomes evident owing to a lack of assets; or • The loan is significantly past due unless both well secured and in the process of collection. Consumer Consumer loans are generally charged off no later than 120 days past due on a contractual basis, earlier in the event of bankruptcy, or if there is an amount deemed uncollectible the adequacy of the allowance for loan losses on at least a quarterly basis to ensure that the provision for loan losses has been charged against earnings in an amount necessary to maintain the allowance at a level that is adequate based on management’s assessment of probable estimated losses. The Company’s methodology for assessing the adequacy of the allowance for loan losses consists of several key elements and is consistent with U.S. GAAP and interagency supervisory guidance. The allowance for loan losses methodology consists of two major components. The first component is an estimation of losses associated with individually identified impaired loans, which follows ASC Topic 310. The second major component estimates losses under ASC Topic 450, which provides guidance for estimating losses on groups of loans with similar risk characteristics. The Company’s methodology results in an allowance for loan losses which includes a specific reserve for impaired loans, an allocated reserve and an unallocated portion. When analyzing groups of loans under ASC Topic 450, the Company follows the Interagency Policy Statement on the Allowance for Loan and Lease Losses. The methodology considers the Company’s historical loss experience adjusted for changes in trends, conditions, and other relevant factors that affect repayment of the loans as of the evaluation date. These adjustment factors, known as qualitative factors, include: • Delinquencies and non-accruals; • Portfolio quality; • Concentration of credit; • Trends in volume and type of loans; • Quality of collateral; • Policy and procedures; • Experience, ability and depth of management; • Economic trends – national and local; and • External factors – competition, legal and regulatory. The methodology includes the segregation of the loan portfolio into loan classes with a further segregation into risk rating categories, such as special mention, substandard, doubtful, and loss. This allows for an allocation of the allowance for loan losses by loan type; however, the allowance is available to absorb any loan loss without restriction. Larger balance, non-homogeneous loans representing significant individual credit exposures are evaluated individually through the internal loan review process. It is this process that produces the watch list for loans that have indications of credit weakness. The borrower’s overall financial condition, repayment sources, guarantors and value of collateral, if appropriate, are evaluated. Based on these reviews, an estimate of probable losses for the individual larger-balance loans are determined, whenever possible, and used to establish specific loan loss reserves. In general, for non-homogeneous loans not individually assessed and for homogeneous groups, such as residential mortgages and consumer credits, the loans are collectively evaluated based on delinquency status, loan type, and historical losses. These loan groups are then internally risk rated. The watch list includes loans that are assigned a rating of special mention, substandard, doubtful and loss. Loans assigned a rating of special mention have potential weaknesses that deserve management’s close attention. If uncorrected, the potential weaknesses may result in deterioration of the repayment prospects. Loans classified as substandard have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They include loans that are inadequately protected by the current sound net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans classified as doubtful have all the weaknesses inherent in loans classified as substandard with the added characteristic that collection or liquidation in full, on the basis of current conditions and facts, is highly improbable. Loans rated as doubtful in whole, or in part, are placed in non-accrual status. Loans classified as a loss are considered uncollectible and are charged off against the allowance for loan losses. The specific allowance for impaired loans is established for specific loans that have been identified by management as being impaired. These loans are considered to be impaired primarily because the loans have not performed according to payment terms and there is reason to believe that repayment of the loan principal in whole, or in part, is unlikely. The specific portion of the allowance is the total amount of potential unconfirmed losses for these individual impaired loans. To assist in determining the fair value of loan collateral, the Company often utilizes independent third party qualified appraisal firms which, in turn, employ their own criteria and assumptions that may include occupancy rates, rental rates and property expenses, among others. The second category of reserves consists of the allocated portion of the allowance. The allocated portion of the allowance is determined by taking pools of loans outstanding that have similar characteristics and applying historical loss experience for each pool. This estimate represents the potential unconfirmed losses within the portfolio. Individual loan pools are created for commercial business loans and commercial real estate loans, construction loans, warehouse lines of credit and various types of loans to individuals. The historical loss estimation for each loan pool is then adjusted for qualitative factors such as economic trends, concentrations of credit, trends in the volume of loans, portfolio quality, delinquencies and non-accrual trends. These factors are evaluated for each class of the loan portfolio and may have positive or negative effects on the allocated allowance for the loan portfolio segment. The aggregate amount resulting from the application of these qualitative factors determines the overall risk for the portfolio and results in an allocated allowance for each of the loan segments. The Company also maintains an unallocated allowance. The unallocated allowance is used to cover any factors or conditions which may cause a potential loan loss but are not specifically identifiable. It is prudent to maintain an unallocated portion of the allowance because no matter how detailed an analysis of potential loan losses is performed, these estimates, by definition, lack precision. Management must make estimates using assumptions and information that is often subjective and changing rapidly. The following discusses the risk characteristics of each of our loan portfolios. Commercial Business The Company offers a variety of commercial loan services, including term loans, lines of credit and loans secured by equipment and receivables. A broad range of short-to-medium term commercial loans, both secured and unsecured, are made available to businesses for working capital (including inventory and receivables), business expansion (including acquisition and development of real estate and improvements) and the purchase of equipment and machinery. Commercial business loans are granted based on the borrower's ability to generate cash flow to support its debt obligations and other cash related expenses. A borrower's ability to repay commercial business loans is substantially dependent on the success of the business itself and on the quality of its management. As a general practice, the Company takes as collateral a security interest in any available real estate, equipment, inventory, receivables or other personal property of its borrowers, although the Company occasionally makes commercial business loans on an unsecured basis. Generally, the Company requires personal guarantees of its commercial business loans to offset the risks associated with such loans. Much of the Company's lending is in northern and central New Jersey. As a result of this geographic concentration, a significant broad-based deterioration in economic conditions in New Jersey and the New York City metropolitan area could have a material adverse impact on the Company's loan portfolio. A prolonged decline in economic conditions in our market area could restrict borrowers' ability to pay outstanding principal and interest on loans when due. The value of assets pledged as collateral may decline and the proceeds from the sale or liquidation of these assets may not be sufficient to repay the loan. Commercial Real Estate Commercial real estate loans are made to businesses to expand their facilities and operations and to real estate operators to finance the acquisition of income producing properties. The Company's loan policy requires that borrowers have sufficient cash flow to meet the debt service requirements and the value of the property meets the loan-to-value criteria set in the loan policy. The Company monitors loan concentrations by borrower, by type of property and by location and other criteria. The Company's commercial real estate portfolio is largely secured by real estate collateral located in the State of New Jersey. Conditions in the real estate markets in which the collateral for the Company's loans are located strongly influence the level of the Company's non-performing loans. A decline in the New Jersey real estate market could adversely affect the Company's loan portfolio. Decreases in local real estate values would adversely affect the value of property used as collateral for the Company's loans. Adverse changes in the economy also may have a negative effect on the ability of our borrowers to make timely repayments of their loans. Construction Financing Construction financing is provided to businesses to expand their facilities and operations and to real estate developers for the acquisition, development and construction of residential and commercial properties. First mortgage construction loans are made to developers and builders primarily for single family homes and multi-family buildings that are presold or are to be sold or leased on a speculative basis. The Company lends to builders and developers with established relationships, successful operating histories and sound financial resources. Management has established underwriting and monitoring criteria to minimize the inherent risks of real estate construction lending. The risks associated with speculative construction lending include the borrower's inability to complete the construction process on time and within budget, the sale or rental of the project within projected absorption periods and the economic risks associated with real estate collateral. Such loans may include financing the development and/or construction of residential subdivisions. This activity may involve financing land purchases and infrastructure development (i.e., roads, utilities, etc.) as well as construction of residences or multi-family dwellings for subsequent sale by the developer/builder. Because the sale or rental of developed properties is integral to the success of developer business, loan repayment may be especially subject to the volatility of real estate market values. Mortgage Warehouse Lines of Credit The Company’s Mortgage Warehouse Funding Group provides revolving lines of credit that are available to licensed mortgage banking companies. The warehouse line of credit is used by the mortgage banker to originate one-to-four family residential mortgage loans that are pre-sold into the secondary mortgage market, which includes state and national banks, national mortgage banking firms, insurance companies and government-sponsored enterprises, including the Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation and others. On average, an advance under the warehouse line of credit remains outstanding for a period of less than 30 days, with repayment coming directly from the sale of the loan into the secondary mortgage market. Interest and a transaction fee are collected by the Company at the time of repayment. As a separate segment of the total portfolio, the warehouse loan portfolio is individually analyzed as a whole for allowance for loan losses purposes. Warehouse lines of credit are subject to the same inherent risks as other commercial lending, but the overall degree of risk differs. While the Company’s loss experience with this type of lending has been non-existent since the product was introduced in 2008, there are other risks unique to this lending that still must be considered in assessing the adequacy of the allowance for loan losses. These unique risks may include, but are not limited to, (i) credit risks relating to the mortgage bankers that borrow from us, (ii) the risk of intentional misrepresentation or fraud by any of such mortgage bankers, (iii) changes in the market value of mortgage loans originated by the mortgage banker, the sale of which is the expected source of repayment of the borrowings under a warehouse line of credit, due to changes in interest rates during the time in warehouse or (iv) unsalable or impaired mortgage loans so originated, which could lead to decreased collateral value and the failure of a purchaser of the mortgage loan to purchase the loan from the mortgage banker. Consumer The Company’s consumer loan portfolio segment is comprised of residential real estate loans, loans to individuals and other loans. Individual loan pools are created for the various types of loans to individuals. The principal risk is the borrower becomes unemployed or has a significant reduction in income. In general, for homogeneous groups such as residential mortgages and consumer credits, the loans are collectively evaluated based on delinquency status, loan type and historical losses. These loan groups are then internally risk rated. The Company considers the following credit quality indicators in assessing the risk in the loan portfolio: • Consumer credit scores; • Internal credit risk grades; • Loan-to-value ratios; • Collateral; and • Collection experience. Internal Risk Rating of Loans The Company’s internal credit risk grades are based on the definitions currently utilized by the banking regulatory agencies. The grades assigned and their definitions are as follows, and loans graded excellent, above average, good and watch list are treated as “pass” for grading purposes: 1. Excellent - Loans that are based upon cash collateral held at the Company and adequately margined. Loans that are based upon "blue chip" stocks listed on the major stock exchanges and adequately margined. 2. Above Average - Loans to companies whose balance sheets show excellent liquidity and long-term debt is on well-spread schedules of repayment easily covered by cash flow. Such companies have been consistently profitable and have diversification in their product lines or sources of revenue. The continuation of profitable operations for the foreseeable future is likely. Management is comprised of a mix of ages, experience and backgrounds, and management succession is in place. Sources of raw materials and, for service companies, the sources of revenue are abundant. Future needs have been planned for. Character and management ability of individuals or company principals are excellent. Loans to individuals are supported by high net worths and liquid assets. 3. Good - Loans to companies whose balance sheets show good liquidity and cash flow adequate to meet maturities of long-term debt with a comfortable margin. Such companies have established profitable records over a number of years, and there has been growth in net worth. Operating ratios are in line with those of the industry, and expenses are in proper relationship to the volume of business done and the profits achieved. Management is well-balanced and competent in their responsibilities. Economic environment is favorable; however, competition is strong. The prospects for growth are good. Loans in this category do not meet the collateral requirements of loans in categories 1 and 2 above. Loans to individuals are supported by good net worth but whose supporting assets are illiquid. 3w. Watch - Included in this category are loans evidencing problems identified by Company management that require closer supervision. Such problems have not developed to the point which requires a "special mention" rating. This category also covers situations where the Company does not have adequate current information upon which credit quality can be determined. The account officer has the obligation to correct these deficiencies within 30 days from the time of notification. 4. Special Mention - A "special mention" loan has potential weaknesses that deserve management's close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or in the Company's credit position at some future date. Special mention loans are not adversely classified and do not expose the Company to sufficient risk to warrant adverse classification. 5. Substandard - A "substandard" loan is inadequately protected by the current sound worth and paying capacity of the obligor or by 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 Company will sustain some loss if the deficiencies are not corrected. 6. Doubtful - A loan classified as "doubtful" has all the weaknesses inherent in a loan classified as substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently known facts, conditions and values, highly questionable and improbable. 7. Loss |
Premises and Equipment | Premises and Equipment: Premises and equipment are stated at cost less accumulated depreciation and amortization. Depreciation is computed primarily on the straight-line method over the estimated useful lives of the related assets for financial reporting purposes and using the mandated methods by asset type for income tax purposes. Building, furniture and fixtures, equipment and leasehold improvements are depreciated or amortized over the estimated useful lives of the assets or lease terms, as applicable. Estimated useful lives of buildings are forty years, furniture and fixtures and equipment are three to fifteen years and leasehold improvements are generally three to ten years. Expenditures for maintenance and repairs are charged to expense as incurred. |
Income Taxes | Income Taxes: There are two components of income tax expense or benefit: current and deferred. Current income tax expense or benefit approximates cash to be paid or refunded for taxes for the applicable period. Deferred tax assets and liabilities are recognized due to differences between the basis of assets and liabilities as measured by tax laws and their basis as reported in the financial statements. Deferred tax assets are subject to management’s judgment based upon available evidence that future realizations are likely. If management determines that the Company may not be able to realize some or all of the net deferred tax asset in the future, a charge to income tax expense may be required to increase the valuation reserve of the net deferred tax asset. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred taxes of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred tax expense or benefit is recognized for the change in deferred tax assets and liabilities. The Company accounts for uncertainty in income taxes recognized in its consolidated financial statements in accordance with ASC Topic 740, "Income Taxes," which prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return, and also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. The Company has not identified any significant income tax uncertainties through the evaluation of its income tax positions for the years ended December 31, 2017 and 2016 and has not recognized any liabilities for tax uncertainties as of December 31, 2017 and 2016 . Our policy is to recognize interest and penalties on unrecognized tax benefits in income tax expense; such amounts were not significant during the years ended December 31, 2017 and 2016 . The tax years subject to examination by the taxing authorities are, for federal and state purposes, the years ended December 31, 2017 , 2016 , 2015 and 2014 . |
Other Real Estate Owned (OREO) | Other Real Estate Owned ("OREO"): OREO obtained through loan foreclosures or the receipt of deeds-in-lieu of foreclosure is recorded at the fair value of the related property, as determined by current appraisals less estimated costs to sell at the initial transfer from the loan portfolio. Write-downs on these properties, which occur after the initial transfer from the loan portfolio, are recorded as operating expenses. Costs of holding such properties are charged to expense in the current period. Gains, to the extent realized, and losses on the disposition of these properties are reflected in current operations. |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets: Goodwill represents the excess of the cost of an acquired entity over the fair value of the identifiable net assets acquired in accordance with the acquisition method of accounting. Goodwill is not amortized but is reviewed for potential impairment on an annual basis, or more often if events or circumstances indicated that there may be impairment, in accordance with ASC Topic 350, “Intangibles – Goodwill and Other.” Goodwill is tested for impairment at the reporting unit level and an impairment loss is recorded to the extent that the carrying amount of goodwill exceeds its implied fair value. Core deposit intangibles are a measure of the value of checking and savings deposits acquired in business combinations accounted for under the purchase method. Core deposit intangibles are amortized over their estimated lives (ranging from five to ten |
Share-Based Compensation | Share-Based Compensation: The Company recognizes compensation expense for stock awards and options in accordance with ASC Topic 718, “Compensation – Stock Compensation.” The expense of stock-based compensation is generally measured at fair value at the grant date with compensation expense recognized over the service period, which is usually the vesting period. The Company utilizes the Black-Scholes option-pricing model to estimate the fair value of each stock option on the date of grant. The Black-Scholes model takes into consideration the exercise price and expected life of the options, the current price of the underlying stock and its expected volatility, the expected dividends on the stock and the current risk-free interest rate for the expected life of the option. The Company’s estimate of the fair value of a stock option is based on expectations derived from historical experience and may not necessarily equate to its market value when fully vested. |
Benefit Plans | Benefit Plans: The Company provides certain retirement savings benefits to employees under a 401(k) plan. The Company’s contributions to the 401(k) plan are expensed as incurred. |
Cash and Cash Equivalents | Cash and Cash Equivalents: Cash and cash equivalents includes cash on hand, interest and non-interest bearing amounts due from banks, federal funds sold and short-term investments. Generally, federal funds are sold and short-term investments are made for a one or two-day period. |
Reclassifications | Reclassifications: Certain reclassifications have been made to the prior period amounts to conform with the current period presentation. Such reclassification had no impact on net income or total shareholders’ equity. |
Advertising Costs | Advertising Costs: It is the Company’s policy to expense advertising costs in the period in which they are incurred. |
Earnings Per Common Share | Earnings Per Common Share: Basic net income per common share is calculated by dividing net income by the weighted average number of common shares outstanding during each period. Diluted net income per common share is calculated by dividing net income by the weighted average number of common shares outstanding, as adjusted for the assumed exercise of dilutive common stock warrants and common stock options using the treasury stock method. |
Comprehensive Income | Comprehensive Income: Comprehensive income consists of net income and other comprehensive income (loss). Other comprehensive income (loss) includes unrealized gains and losses on securities available for sale, other-than-temporary non-credit related security impairments, and changes in the funded status of benefit plans. |
Variable Interest Entities | Variable Interest Entities: Management has determined that Trust II qualifies as a variable interest entity under ASC Topic 810, “Consolidation.” Trust II issued mandatorily redeemable preferred stock to investors, loaned the proceeds to the Company and holds, as its sole asset, subordinated debentures issued by the Company. As a qualified variable interest entity, Trust II’s balance sheet and statement of operations have never been consolidated with those of the Company because the Company is not the beneficiary. In March 2005, the Federal Reserve Board ("FRB") adopted a final rule that would continue to allow the inclusion of trust preferred securities in Tier 1 capital, but with stricter quantitative limits. Under the final rule, after a five-year transition period, the aggregate amount of trust preferred securities and certain other capital elements would be limited to 25% of Tier 1 capital elements, net of goodwill. The amount of trust preferred securities and certain other elements in excess of the limit could be included in Tier 2 capital, subject to restrictions. Based on the final rule, the Company has included all of its $18.0 million in trust preferred securities in Tier 1 capital at December 31, 2017 and 2016 . |
Segment Information | Segment Information: U.S. GAAP establishes standards for public business enterprises to report information about operating segments in their annual financial statements and requires that those enterprises report selected information about operating segments in subsequent interim financial reports issued to shareholders. It also established standards for related disclosure about products and services, geographic areas and major customers. Operating segments are components of an enterprise, which are evaluated regularly by the chief operating decision-maker in deciding how to allocate and assess resources and performance. The Company’s chief operating decision-maker is the President and Chief Executive Officer. The Company has applied the aggregation criteria for its operating segments to create one reportable segment, “Community Banking.” |
Recent Accounting Pronouncements | Recent Accounting Pronouncements ASU 2018-02 - Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income In February 2018, the FASB issued Accounting Standards Update ("ASU") 2018-02, "Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income," which allows for reclassification from accumulated other comprehensive income (loss) to retained earnings for stranded tax effects resulting from the Tax Act described in the "Income Taxes" section above. The amount of the reclassification should include the effect of the change in the federal corporate income tax rate related to items remaining in accumulated other comprehensive income (loss). The ASU would require an entity to disclose whether it elects to reclassify stranded tax effects from accumulated other comprehensive income (loss) to retained earnings in the period of adoption and, more generally, a description of the accounting policy for releasing income tax effects from accumulated other comprehensive income (loss). The amendments in this update are effective for fiscal years, and interim period within those fiscal years, beginning after December 15, 2018. Early adoption of the amendments in this update is permitted for periods for which financial statements have not been issued or made available for issuance, including in the period the Tax Act was enacted. The Company elected to adopt the guidance for the year ended December 31, 2017. As of December 31, 2017, the Company reclassified $109,000 of stranded tax effects related to net unrealized losses on its investment securities and actuarial gains for unfunded pension liability to its retained earnings, which did not have a material impact on the consolidated financial statements. ASU Update 2017-08 - Premium Amortization on Purchased Callable Debt Securities In March 2017, the FASB issued ASU 2017-08, "Premium Amortization on Purchased Callable Debt Securities," which shortens the amortization period for premiums on purchased callable debt securities to the earliest call date (i.e., yield-to-earliest call amortization) rather than amortizing over the full contractual term. The ASU does not change the accounting for securities held at a discount. The amendments apply to callable debt securities with explicit, non-contingent call features that are callable at fixed prices and on preset dates. If a security may be prepaid based upon prepayments of the underlying loans and not because the issuer exercised a date specific call option, it is excluded from the scope of the new standard. However, for instruments with contingent call features, once the contingency is resolved and the security is callable at a fixed price and preset date, the security is within the scope of the amendments. Further, the amendments apply to all premiums on callable debt securities, regardless of how they were generated. The amendments require companies to reset the effective yield using the payment terms of the debt security if the call option is not exercised on the earliest call date. If the security has additional future call dates, any excess of the amortized cost basis over the amount repayable by the issuer at the next call date should be amortized to the next call date. For the Company, the provisions of this ASU are effective for fiscal years beginning after December 15, 2018, including interim periods within those years. Early adoption is permitted, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes the interim period. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements. ASU Update 2017-07 - Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost In March 2017, the FASB issued ASU 2017-07, "Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost," which requires that an employer disaggregate the service cost component from the other components of net benefit costs as follows: (1) service cost must be presented in the same line item(s) as other employee compensation costs. These costs are generally included within income from continuing operations but in some cases, may be eligible for capitalization if certain criteria are met; and (2) all other components of net benefit cost must be presented in the income statement separately from the service cost component and outside a subtotal of income from operations, if one is presented. These generally include interest cost, actual return on plan assets, amortization of prior service cost included in accumulated other comprehensive income and gains or losses from changes in the value of the projected benefit obligation or plan assets. For the Company, the provisions of this ASU are effective for fiscal years beginning after December 15, 2017, including interim periods within those years. Early adoption is permitted as of the beginning of an annual period. The Company has determined that the adoption of this guidance will not have a material impact on its consolidated financial statements. ASU Update 2017-04 - Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment In January 2017, the FASB issued ASU 2017-04 "Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment," which simplifies how all entities assess goodwill for impairment by eliminating Step 2 from the goodwill impairment test. As amended, the goodwill impairment test will consist of one step comparing the fair value of a reporting unit with its carrying amount. An entity should recognize a goodwill impairment charge for the amount by which the carrying amount exceeds the reporting unit's fair value. The primary goal of this ASU is to simplify the goodwill impairment test and provide cost savings for all entities by removing the requirement to determine the fair value of individual assets and liabilities in order to calculate a reporting unit's "implied" goodwill under current U.S. GAAP. For the Company, the provisions of this ASU are effective for its annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. The amendments should be adopted prospectively. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements. ASU Update 2017-01 - Business Combinations (Topic 805): Clarifying the Definition of a Business In January 2017, the FASB issued ASU 2017-01 "Business Combinations (Topic 805): Clarifying the Definition of a Business," which clarifies the definition of a business with the objective of adding guidance to assist companies and other reporting organizations with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The amendments in this ASU provide a more robust framework to use in determining when a set of assets and activities is a business. The current definition of a business is interpreted broadly and can be difficult to apply. Stakeholders indicated that analyzing transactions is inefficient and costly and the definition does not permit the use of reasonable judgment. Under current implementation guidance, there are three elements of a business: inputs, processes and outputs. While an integrated set of assets and activities (collectively referred to as a "set") that is a business usually has outputs, outputs are not required to be present. Additionally, all the inputs and processes that a seller uses in operating a set are not required if market participants can acquire the set and continue to produce outputs, for example, by integrating the acquired set with their own inputs and processes. The ASU introduces a "screen" to assist entities in determining when a set should not be considered a business. If substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets, the set is not considered a business. If the screen is not met, the ASU requires that to be considered a business, a set must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create output. Further, the ASU removes the evaluation of whether a market participant could replace missing elements (as required under current U.S. GAAP). For the Company, the ASU is effective for annual periods beginning after December 15, 2017, including interim periods within those periods. The amendments in this ASU should be applied prospectively on or after the effective date. No disclosures are required at transition. The Company has determined that the adoption of this guidance will not have a material impact on its consolidated financial statements. ASU Update 2016-15 - Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments . In August 2016, the FASB issued ASU 2016-15 "Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments," which clarifies whether the following items should be categorized as operating, investing or financing in the statement of cash flows: (1) debt prepayment and extinguishment costs, (2) settlement of zero-coupon debt, (3) settlement of contingent consideration, (4) insurance proceeds, (5) settlement of corporate-owned life insurance (COLI) and bank-owned life insurance (BOLI) policies, (6) distributions from equity method investees, (7) beneficial interests in securitization transactions and (8) receipts and payments with aspects of more than one class of cash flows. For the Company, the provisions of this ASU are effective for fiscal years beginning after December 15, 2017 and interim periods within those fiscal years. The Company currently classifies cash flows related to BOLI in accordance with the guidance and the adoption of this guidance will not have a material impact on its consolidated financial statements. ASU Update 2016-13 - Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments In June 2016, the FASB issued ASU 2016-13 "Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments," which requires credit losses on most financial assets to be measured at amortized cost and certain other instruments to be measured using an expected credit loss model (referred to as the current expected credit loss (CECL) model). Under this model, entities will estimate credit losses over the entire contractual term of the instrument (considering estimated prepayments but not expected extensions or modifications unless reasonable expectation of a troubled debt restructuring exists) from the date of initial recognition of that instrument. The ASU also replaces the current accounting model for purchased credit impaired loans and debt securities. The allowance for credit losses for purchased financial assets with a more-than-insignificant amount of credit deterioration since origination ("PCD assets") should be determined in a similar manner to other financial assets measured on an amortized cost basis. Upon initial recognition, the allowance for credit losses is added to the purchase price ("gross up approach") to determine the initial amortized cost basis. The subsequent accounting for PCD assets will use the CECL model described above. The ASU made certain targeted amendments to the existing impairment model for available-for-sale (AFS) debt securities. For an AFS debt security for which there is neither the intent nor a more-likely-than-not requirement to sell, an entity will record credit losses as an allowance rather than a write-down of the amortized cost basis. For the Company, the provisions of this ASU are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for all entities as of the fiscal year beginning after December 15, 2018, including interim periods within those fiscal years. The Company is currently evaluating the impact of the pending adoption of the new standard on its consolidated financial statements. ASU Update 2016-02 - Leases In February 2016, the FASB issued ASU 2016-02 "Leases ." From the lessee's perspective, the new standard establishes a right- of-use ("ROU") model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement for a lessee. From the lessor's perspective, the new standard requires a lessor to classify leases as either sales-type, finance or operating. A lease will be treated as a sale if it transfers all of the risks and rewards, as well as control of the underlying asset, to the lessee. If risks and rewards are conveyed without the transfer of control, the lease is treated as a financing. If the lessor doesn’t convey risks and rewards or control, an operating lease results. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. A modified retrospective transition approach is required for lessors for sales-type, direct financing and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is currently completing an evaluation of all of its leases to determine the potential impact on the Company's consolidated financial statements as a result of this new standard. ASU Update 2016-01 - Financial Instruments-Overall: Recognition and Measurement of Financial Assets and Financial Liabilities In January 2016, the FASB issued ASU 2016-01 "Financial Instruments-Overall: Recognition and Measurement of Financial Assets and Financial Liabilities." The guidance in the ASU, among other things, requires equity investments, with certain exceptions, to be measured at fair value with changes in fair value recognized in net income; simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment; eliminates the requirement for public business 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; requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; 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; 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 clarifies that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities. For the Company, the guidance in this ASU is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company has determined that the adoption of this guidance will not have a material impact on its consolidated financial statements. ASU 2014-9 -Revenue from Contracts with Customers (Topic 606) In May 2014, the FASB issued ASU 2014-9, deferred by ASU 2015-14, “Revenue from Contracts with Customers (Topic 606).” The amendments in this update establish a comprehensive revenue recognition standard for virtually all industries under U.S. GAAP, including those that previously followed industry specific guidance such as the real estate, construction and software industries. The revenue standard's core principle is built on the contract between a vendor and a customer for the provision of goods and services. It attempts to depict the exchange of rights and obligations between the parties in the pattern of revenue recognition based on the consideration to which the vendor is entitled. To accomplish this objective, the standard requires five basic steps: (1) identify the contract with the customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract and (5) recognize revenue when (or as) the entity satisfies a performance obligation. In December 2016, the FASB issued ASU 2016-20 "Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers," amending the new revenue recognition standard that it jointly issued with the International Accounting Standards Board ("IASB") in 2014. The amendments do not change the core principles of the standard, but clarify certain narrow aspects of the standard, including its scope, contract cost accounting, disclosures, illustrative examples and other matters. The ASU becomes effective concurrently with ASU 2014-09 "Revenue from Contracts with Customers (Topic 606)." The Company's revenue is comprised of primarily interest income on interest-earning assets less interest expense on interest-bearing liabilities and non-interest income. The scope of this guidance excludes net interest income as well as other revenues associated with financial assets and liabilities (such as gains on the sale of loans, loan fees and loan servicing fees), including loans, leases and securities. Accordingly, a significant portion of the Company's revenues will not be affected. The Company has decided to use the modified retrospective method to adopt the guidance. For the year ended December 31, 2017, approximately 85% |
Fair Value Disclosures | U.S. GAAP has established a fair value hierarchy that prioritizes the inputs to valuation methods used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows: Level 1. Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. Level 2. Quoted prices in markets that are not active, or inputs that are observable either directly or indirectly, for substantially the full term of the asset or liability. Level 3. Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported with little or no market activity). An asset’s or liability’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. A description of the valuation methodologies used for instruments measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy, is set forth below. These valuation methodologies were applied to all of the Company’s financial assets and financial liabilities carried at fair value. In general, fair value is based upon quoted market prices, where available. If such quoted market prices are not available, fair value is based upon internally developed models that primarily use, as inputs, observable market-based parameters. Valuation adjustments may be made to ensure that financial instruments are recorded at fair value. These adjustments may include amounts to reflect counterparty credit quality and counterparty creditworthiness, among other things, as well as unobservable parameters. Any such valuation adjustments are applied consistently over time. The Company’s valuation methodologies may produce a fair value calculation that may not be indicative of net realizable value or reflective value or reflective of future values. While management believes that the Company’s valuation methodologies are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different estimate of fair value at the reporting date. Securities Available for Sale: Securities classified as available for sale are reported at fair value utilizing Level 1 and Level 2 inputs. For Level 2 securities, the fair value measurements consider observable data that may include dealer quotes, market spreads, cash flows, the U.S. Treasury yield curve, live trading levels, trade execution data, market consensus prepayment speeds, credit information and the security’s terms and conditions, among other things. Impaired loans: Loans included in the following table are those which the Company has measured and recognized impairment based generally on the fair value of the loan’s collateral. Fair value is generally determined based upon independent third party appraisals of the properties or discounted cash flows based on the expected proceeds. These assets are included as Level 3 fair values based upon the lowest level of input that is significant to the fair value measurements. The fair value consists of the loan balances less specific valuation allowances. |
Summary of Significant Accoun33
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table illustrates the calculation of both basic and diluted earnings per share for the years ended December 31, 2017 , 2016 and 2015 : (In thousands, except per share data) 2017 2016 2015 Net income $ 6,928 $ 9,285 $ 8,664 Basic weighted average shares outstanding 8,049,981 7,962,121 7,901,278 Plus: common stock equivalents 262,803 215,318 174,474 Diluted weighted average shares outstanding 8,312,784 8,177,439 8,075,752 Earnings per share: Basic $ 0.86 $ 1.17 $ 1.10 Diluted 0.83 1.14 1.07 |
Investment Securities (Tables)
Investment Securities (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
Available-for-sale Securities | A summary of amortized cost and fair value of investment securities available for sale as of December 31, 2017 and 2016 follows: 2017 Gross Gross Amortized Unrealized Unrealized Fair (In thousands) Cost Gains Losses Value U.S. Treasury securities and obligations of U.S. Government sponsored corporations (“GSE”) $ 1,997 $ — $ (30 ) $ 1,967 Residential collateralized mortgage obligations- GSE 27,688 18 (381 ) 27,325 Residential mortgage backed securities – GSE 14,231 129 (72 ) 14,288 Obligations of state and political subdivisions 19,575 227 (82 ) 19,720 Trust preferred debt securities – single issuer 2,481 — (132 ) 2,349 Corporate debt securities 27,917 14 (248 ) 27,683 Other debt securities 12,140 12 (26 ) 12,126 $ 106,029 $ 400 $ (971 ) $ 105,458 2016 Gross Gross Amortized Unrealized Unrealized Fair (In thousands) Cost Gains Losses Value U. S. Treasury securities and obligations of U.S. Government sponsored corporations (“GSE”) $ 3,514 $ — $ (35 ) $ 3,479 Residential collateralized mortgage obligations - GSE 22,647 58 (145 ) 22,560 Residential mortgage backed securities – GSE 31,207 388 (119 ) 31,476 Obligations of state and political subdivisions 21,604 152 (356 ) 21,400 Trust preferred debt securities – single issuer 2,478 — (206 ) 2,272 Corporate debt securities 21,963 10 (205 ) 21,768 Other debt securities 845 — (6 ) 839 $ 104,258 $ 608 $ (1,072 ) $ 103,794 |
Held-to-maturity Securities | A summary of amortized cost, carrying value and fair value of investment securities held to maturity as of December 31, 2017 and 2016 follows: 2017 (In thousands) Amortized Cost Other-Than- Temporary Impairment Recognized In Accumulated Other Comprehensive Loss Carrying Value Gross Unrealized Gains Gross Unrealized Losses Fair Value U. S. Treasury securities and obligations of U.S. Government sponsored corporations (“GSE”) $ 3,234 $ — $ 3,234 $ — $ (84 ) $ 3,150 Residential collateralized mortgage obligations – GSE 8,701 — 8,701 94 (123 ) 8,672 Residential mortgage backed securities - GSE 34,072 — 34,072 231 (127 ) 34,176 Obligations of state and political subdivisions 63,797 — 63,797 1,224 (35 ) 64,986 Trust preferred debt securities - pooled 657 (501 ) 156 418 — 574 Other debt securities 307 — 307 — — 307 $ 110,768 $ (501 ) $ 110,267 $ 1,967 $ (369 ) $ 111,865 2016 (In thousands) Amortized Cost Other-Than- Temporary Impairment Recognized In Accumulated Other Comprehensive Loss Carrying Value Gross Unrealized Gains Gross Unrealized Losses Fair Value Obligations of U.S. Government sponsored corporations (“GSE”) $ 3,727 $ — $ 3,727 $ — $ (116 ) $ 3,611 Residential collateralized mortgage obligations – GSE 11,882 — 11,882 247 (130 ) 11,999 Residential mortgage backed securities - GSE 40,565 — 40,565 540 (113 ) 40,992 Obligations of state and political subdivisions 70,017 — 70,017 1,274 (255 ) 71,036 Trust preferred debt securities - pooled 657 (501 ) 156 303 — 459 Other debt securities 463 — 463 — (1 ) 462 $ 127,311 $ (501 ) $ 126,810 $ 2,364 $ (615 ) $ 128,559 |
Gain (Loss) on Investments | The following is a summary of the proceeds, gross gains, gross losses and net tax expense related to proceeds on sales of investment securities for the year ended December 31, 2017 . (In thousands) Available for Sale Held to Maturity Proceeds on sales $ 7,602 $ 1,034 Gross gains 120 36 Gross losses (27 ) — Net tax expense 31 12 |
Investments Classified by Contractual Maturity Date | The following table sets forth certain information regarding the amortized cost, carrying value, fair value, weighted average yields and contractual maturities of the Company's investment portfolio as of December 31, 2017 . Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. (Dollars in thousands) Amortized Cost Fair Value Yield Available for sale Due in one year or less $ 473 $ 473 1.84 % Due after one year through five years 24,661 24,612 2.54 Due after five years through ten years 27,307 27,131 2.72 Due after ten years 53,588 53,242 2.69 Total $ 106,029 $ 105,458 2.66 % Carrying Value Fair Value Yield Held to maturity Due in one year or less $ 28,750 $ 28,780 1.89 % Due after one year through five years 17,793 18,419 4.85 Due after five years through ten years 18,845 19,235 3.55 Due after ten years 44,879 45,431 3.09 Total $ 110,267 $ 111,865 3.14 % |
Investment Securities, Continuous Unrealized Loss Position, Fair Value | The following table presents gross unrealized losses on the Company's investment securities and the fair value of the related securities and length of time that the individual securities have been in a continuous unrealized loss position at December 31, 2017 and 2016 . 2017 Less than 12 months 12 months or longer Total (In thousands) Number of Securities Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses U. S. Treasury securities and obligations of U.S. Government sponsored corporations (“GSE”) 2 $ 1,967 $ (30 ) $ 3,150 $ (84 ) $ 5,117 $ (114 ) Residential collateralized mortgage obligations - GSE 11 19,237 (205 ) 8,788 (299 ) 28,025 (504 ) Residential mortgage backed securities - GSE 35 21,770 (141 ) 3,074 (58 ) 24,844 (199 ) Obligations of state and political subdivisions 42 11,594 (82 ) 2,717 (35 ) 14,311 (117 ) Trust preferred debt securities -single issuer 4 — — 2,349 (132 ) 2,349 (132 ) Corporate debt securities 7 11,967 (98 ) 7,662 (150 ) 19,629 (248 ) Other debt securities 4 8,840 (25 ) 21 (1 ) 8,861 (26 ) Total temporarily impaired securities 105 $ 75,375 $ (581 ) $ 27,761 $ (759 ) $ 103,136 $ (1,340 ) 2016 Less than 12 months 12 months or longer Total (In thousands) Number of Securities Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses U.S. Treasury securities and obligations of U.S. Government sponsored corporations (GSE) 3 $ 7,090 $ (151 ) $ — $ — $ 7,090 $ (151 ) Residential collateralized mortgage obligations-GSE 7 17,242 (275 ) — — 17,242 (275 ) Residential mortgage backed securities - GSE 29 26,581 (216 ) 3,542 (16 ) 30,123 (232 ) Obligations of state and political subdivisions 74 25,545 (611 ) — — 25,545 (611 ) Trust preferred debt securities– single issuer 4 — — 2,272 (206 ) 2,272 (206 ) Corporate debt securities 6 12,700 (204 ) 1,999 (1 ) 14,699 (205 ) Other debt securities 3 — — 1,276 (7 ) 1,276 (7 ) Total temporarily impaired securities 126 $ 89,158 $ (1,457 ) $ 9,089 $ (230 ) $ 98,247 $ (1,687 ) |
Loans and Loans Held for Sale (
Loans and Loans Held for Sale (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Receivables [Abstract] | |
Schedule of Accounts, Notes, Loans and Financing Receivable | The following table presents loans outstanding, by class of loan, as of December 31, (In thousands) 2017 2016 Commercial real estate $ 308,924 $ 242,184 Mortgage warehouse lines 189,412 216,259 Construction 136,412 96,035 Commercial business 92,906 99,859 Residential real estate 40,494 44,791 Loans to individuals 21,025 23,736 Other 183 207 Gross Loans 789,356 723,071 Deferred loan costs, net 550 1,737 Total $ 789,906 $ 724,808 (In thousands) 2017 2016 Residential real estate $ 2,269 $ 14,829 SBA 1,985 — $ 4,254 $ 14,829 |
Servicing Asset at Amortized Cost | The table below summarizes the changes in the related servicing assets for the years ended December 31, 2017 and 2016. (In thousands) 2017 2016 Balance, beginning of year $ 605 $ 345 Servicing assets capitalized 302 377 Amortization expense (181 ) (117 ) Balance, end of year $ 726 $ 605 |
Allowance for Loan Losses and36
Allowance for Loan Losses and Credit Quality Disclosures (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Receivables [Abstract] | |
Past Due Financing Receivables | The following table provides an aging of the loan portfolio by loan class at December 31, 2017 and 2016 : 2017 (Dollars in thousands) 30-59 Days 60-89 Days Greater than 90 Days Total Past Due Current Total Loans Receivable Recorded Investment > 90 Days Accruing Nonaccrual Loans Commercial real estate $ 540 $ — $ 2,465 $ 3,005 $ 305,919 $ 308,924 $ — $ 2,465 Mortgage warehouse lines — — — — 189,412 189,412 — — Construction — $ — — $ — 136,412 136,412 — — Commercial business 180 545 619 1,344 91,562 92,906 — 4,212 Residential real estate 911 256 69 1,236 39,258 40,494 — 69 Loans to individuals 119 — 116 235 20,790 21,025 — 368 Other — — — — 183 183 — — $ 1,750 $ 801 $ 3,269 $ 5,820 $ 783,536 789,356 $ — $ 7,114 Deferred loan costs, net 550 Total $ 789,906 2016 (Dollars in thousands) 30-59 Days 60-89 Days Greater than 90 Days Total Past Due Current Total Loans Receivable Recorded Investment > 90 Days Accruing Nonaccrual Loans Commercial real estate $ 741 $ 942 $ 2,707 $ 4,390 $ 237,794 $ 242,184 $ — $ 3,187 Mortgage warehouse lines — — — — 216,259 216,259 — — Construction — — 186 $ 186 95,849 96,035 — 186 Commercial business 113 115 790 1,018 98,841 99,859 — 920 Residential real estate 564 — 392 956 43,835 44,791 — 544 Loans to individuals — 29 361 390 23,346 23,736 24 337 Other — — — — 207 207 — — $ 1,418 $ 144 $ 4,436 $ 6,940 $ 716,131 723,071 $ 24 $ 5,174 Deferred loan costs, net 1,737 Total $ 724,808 |
Financing Receivable Credit Quality Indicators | The following table provides a breakdown of the loan portfolio by credit quality indicator at December 31, 2017 and 2016 : Commercial Credit Exposure by Internally Assigned Grade 2017 (In thousands) Construction Commercial Business Commercial Real Estate Mortgage Warehouse Lines Residential Real Estate Pass $ 136,180 $ 84,746 $ 289,203 $ 189,412 $ 39,539 Special Mention 232 3,454 13,267 — 666 Substandard — 1,252 6,454 — 289 Doubtful — 3,454 — — — Total $ 136,412 $ 92,906 $ 308,924 $ 189,412 $ 40,494 Consumer Credit Exposure by Payment Activity 2017 (In thousands) Loans to Individuals Other Performing $ 20,657 $ 183 Nonperforming 368 — Total $ 21,025 $ 183 Commercial Credit Exposure by Internally Assigned Grade 2016 (In thousands) Construction Commercial Business Commercial Real Estate Mortgage Warehouse Lines Residential Real Estate Pass $ 95,548 $ 92,117 $ 223,226 $ 216,259 $ 43,950 Special Mention 301 7,102 14,334 — 244 Substandard 186 611 4,624 — 597 Doubtful — 29 — — — Total $ 96,035 $ 99,859 $ 242,184 $ 216,259 $ 44,791 Consumer Credit Exposure by Payment Activity 2016 (In thousands) Loans to Individuals Other Performing $ 23,375 $ 207 Nonperforming 361 — Total $ 23,736 $ 207 |
Allowance for Credit Losses on Financing Receivables | The following tables summarize the distribution of the allowance for loan losses and loans receivable by loan class and impairment method as of and for the years ended December 31, 2017 , 2016 and 2015, respectively. 2017 (Dollars in thousands) Construction Commercial Business Commercial Real Estate Mortgage Warehouse Lines Residential Real Estate Loans to Individuals Other Unallocated Deferred Fees Total Allowance for loan losses: Beginning balance $ 1,204 $ 1,732 $ 2,574 $ 973 $ 367 $ 112 $ — $ 532 $ 7,494 Provision (credit) charged to operations 499 2 358 (121 ) 126 (2 ) (13 ) (249 ) 600 Loans charged off — (61 ) — — (101 ) — — — (162 ) Recoveries of loans charged off — 47 17 — — 4 13 — 81 Ending balance $ 1,703 $ 1,720 $ 2,949 $ 852 $ 392 $ 114 $ — $ 283 $ 8,013 Individually evaluated for impairment $ — $ 592 $ 92 $ — $ — $ — $ — $ — $ 684 Collectively evaluated 1,703 1,128 2,460 852 392 114 — 283 7,329 Ending balance $ 1,703 $ 1,720 $ 2,949 $ 852 $ 392 $ 114 $ — $ 283 $ 8,013 Loans receivables: Loans acquired with deteriorated credit quality $ — $ 274 $ 590 $ — $ — $ — $ — $ — $ — $ 864 Individually evaluated for impairment 232 4,459 5,713 — 69 368 — — — 10,841 Collectively evaluated for impairment $ 136,180 88,173 $ 302,621 189,412 40,425 $ 20,657 183 — 550 778,201 Total $ 136,412 $ 92,906 $ 308,924 $ 189,412 $ 40,494 $ 21,025 $ 183 $ — $ 550 $ 789,906 2016 (In thousands) Construction Commercial Business Commercial Real Estate Mortgage Warehouse Lines Residential Real Estate Loans to Individuals Other Unallocated Deferred Fees Total Allowance for loan losses: Beginning balance $ 1,025 $ 2,005 $ 3,049 $ 866 $ 288 $ 109 $ — $ 218 $ 7,560 (Credit) provision charged to operations 179 (177 ) (800 ) 107 79 (3 ) 1 314 (300 ) Loans charged off — (97 ) (60 ) — — — (1 ) — (158 ) Recoveries of loans charged off — 1 385 — — 6 — 392 Ending balance $ 1,204 $ 1,732 $ 2,574 $ 973 $ 367 $ 112 $ — $ 532 $ 7,494 Individually evaluated for impairment $ 7 $ 101 $ 114 $ — $ 38 $ — $ — $ — $ 260 Collectively evaluated for impairment 1,197 1,631 2,460 973 329 112 — 532 7,234 Ending balance $ 1,204 $ 1,732 $ 2,574 $ 973 $ 367 $ 112 $ — $ 532 $ 7,494 Loans receivable: Loans acquired with deteriorated credit quality $ — $ 191 $ 930 $ — $ — $ — $ — $ — $ — $ 1,121 Individually evaluated for impairment 391 947 3,817 — 544 337 — — — 6,036 Collectively evaluated for impairment 95,644 98,721 237,437 216,259 44,247 23,399 207 — 1,737 717,651 Total $ 96,035 $ 99,859 $ 242,184 $ 216,259 $ 44,791 $ 23,736 $ 207 $ — $ 1,737 $ 724,808 2015 (In thousands) Construction Commercial Business Commercial Real Estate Mortgage Warehouse Lines Residential Real Estate Loans to Individuals Other Unallocated Deferred Fees Total Allowance for loan losses: Beginning balance $ 1,215 $ 1,761 $ 2,393 $ 896 $ 197 $ 129 $ 2 $ 332 $ 6,925 (Credit) provision charged to operations (190 ) 347 1,010 (30 ) 91 (13 ) (1 ) (114 ) 1,100 Loans charged off — (116 ) (361 ) — — (13 ) (1 ) — (491 ) Recoveries of loans charged off — 13 7 — — 6 — — 26 Ending balance $ 1,025 $ 2,005 $ 3,049 $ 866 $ 288 $ 109 $ — $ 218 $ 7,560 |
Impaired Financing Receivables | The following tables summarize information regarding impaired loans receivable by loan class as of and for the years ended December 31, 2017 , 2016 and 2015, respectively. 2017 (Dollars in thousands) Recorded Investment Unpaid Principal Balance Related Allowance Year to Date 2017 Average Recorded Investment Year to Date 2017 Interest Income Recognized With no related allowance: Commercial: Construction $ 232 $ 232 $ — $ 209 $ 12 Commercial business 1,271 1,419 — 828 153 Commercial real estate 1,348 1,372 — 2,772 128 Mortgage warehouse lines — — — — — 2,851 3,023 — 3,809 293 Consumer: Residential real estate 69 123 — 142 — Loans to individuals 368 438 — 342 — Other — — — — — 437 561 — 484 — With no related allowance 3,288 3,584 — 4,293 293 With an allowance: Commercial: Construction — — — 86 — Commercial business 3,462 3,464 592 2,864 84 Commercial real estate 4,955 5,748 92 3,005 188 Mortgage warehouse lines — — — — — 8,417 9,212 684 5,955 272 Consumer: Residential real estate — — — 75 — Loans to individuals — — — — — Other — — — — — — — — 75 — With an allowance 8,417 9,212 684 6,030 272 Total: Construction 232 232 — 295 12 Commercial business 4,733 4,883 592 3,692 237 Commercial real estate 6,303 7,120 92 5,777 316 Mortgage warehouse lines — — — — — Residential real estate 69 123 — 217 — Loans to individuals 368 438 — 342 — Other — — — — — $ 11,705 $ 12,796 $ 684 $ 10,323 $ 565 December 31, 2016 (Dollars in thousands) Recorded Investment Unpaid Principal Balance Related Allowance Year to Date 2016 Average Recorded Investment Year to Date 2016 Interest Income Recognized With no related allowance: Commercial: Construction $ 186 $ 186 $ — $ 260 $ — Commercial business 883 1,054 — 623 14 Commercial real estate 1,380 1,380 — 1,528 74 Mortgage warehouse lines — — — — — 2,449 2,620 — 2,411 88 Consumer: Residential real estate 244 244 — 725 — Loans to individuals 337 337 — 281 — Other — — — — — 581 581 — 1,006 — With no related allowance 3,030 3,201 — 3,417 88 With an allowance: Commercial: Construction 205 205 7 51 9 Commercial business 255 255 101 238 — Commercial real estate 3,367 3,367 114 3,603 19 Mortgage warehouse lines — — — — — 3,827 3,827 222 3,892 28 Consumer: Residential real estate 300 316 38 200 — Loans to individuals — — — — — Other — — — — — 300 316 38 200 — With an allowance 4,127 4,143 260 4,092 28 Total: Construction 391 391 7 311 9 Commercial business 1,138 1,309 101 861 14 Commercial real estate 4,747 4,747 114 5,131 93 Mortgage warehouse lines — — — — — Residential real estate 544 560 38 925 — Loans to individuals 337 337 — 281 — Other — — — — — $ 7,157 $ 7,344 $ 260 $ 7,509 $ 116 (Dollars in thousands) Year to Date 2015 Average Recorded Investment Year to Date 2015 Interest Income Recognized With no related allowance: Commercial: Construction $ 477 $ 27 Commercial business 492 23 Commercial real estate 2,998 94 Mortgage warehouse lines — — 3,967 144 Consumer: Residential real estate 981 — Loans to individuals 88 — Other — — 88 — With no related allowance 5,036 144 With an allowance: Commercial: Construction — — Commercial business 307 5 Commercial real estate 4,200 154 Mortgage warehouse lines — — 4,507 159 Consumer: Residential real estate 100 — Loans to individuals 175 — Other — — 275 — With an allowance 4,882 159 Total: Construction 477 27 Commercial business 799 28 Commercial real estate 7,198 248 Mortgage warehouse lines — — Residential real estate 1,081 — Loans to individuals 263 — Other — — $ 9,818 $ 303 December 31, 2017 and 2016 : (In thousands) 2017 2016 Outstanding balance $ 998 $ 1,470 Carrying amount 860 1,121 |
Credit Impaired Loans Purchased, Change In Amortizable Yield | The following table presents changes in accretable discount for PCI loans for the years ended December 31, 2017 , 2016 and 2015 : (In thousands) 2017 2016 2015 Balance at beginning of year $ 30 $ 73 $ 135 Transfer from non-accretable to accretable 161 — — Accretion of discount (65 ) (43 ) (62 ) Balance at end of year $ 126 $ 30 73 Non-accretable difference at end of year $ 26 $ 215 $ 215 |
Remaining Estimated Accretable Discount | The following table presents the years for the scheduled remaining accretable discount that will accrete to income based on the Company’s most recent estimates of cash flows for PCI loans: (In thousands) Years ending December 31, 2018 $ 82 2019 44 Thereafter — Total $ 126 |
Troubled Debt Restructurings on Financing Receivables | The following table summarizes the recorded investment in consumer mortgage loans secured by residential real estate in process of foreclosure: December 31, (Dollars in thousands) 2017 2016 Number of loans Recorded Investment Number of loans Recorded Investment 1 $ 77 3 $ 524 December 31, 2017 and 2016 : 2017 (Dollars in thousands) Number of Contracts Pre-Modification Outstanding Recorded Investment Post-Modification Outstanding Recorded Investment Troubled Debt Restructurings: Commercial Real Estate 1 $ 2,337 $ 2,322 2016 (Dollars in thousands) Number of Contracts Pre-Modification Outstanding Recorded Investment Post-Modification Outstanding Recorded Investment Troubled Debt Restructurings: Commercial Business 1 $ 458 $ 458 |
Related Parties (Tables)
Related Parties (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | Activity related to loans to directors, executive officers and their affiliated interests during the years ended December 31, 2017 and 2016 is as follows: (In thousands) 2017 2016 2015 Balance, beginning of year $ 1,357 $ 870 $ 1,376 Loans granted 1,603 751 16 Repayments of loans (241 ) (264 ) (522 ) Balance, end of year $ 2,719 $ 1,357 $ 870 |
Premises and Equipment (Tables)
Premises and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Premises and Equipment | Premises and equipment consist of the following at December 31, (Dollars in thousands) Estimated Useful Lives 2017 2016 Land $ 1,798 $ 1,798 Building 40 years 8,083 8,083 Leasehold improvements 3 - 10 years 6,241 5,864 Furniture, fixtures and equipment 3 - 15 years 5,032 4,794 Projects in progress 337 103 21,491 20,642 Less: Accumulated depreciation 10,786 9,969 Total $ 10,705 $ 10,673 |
Other Real Estate Owned ("ORE39
Other Real Estate Owned ("OREO") (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Real Estate [Abstract] | |
Other Real Estate, Roll Forward | The following table presents the activity in other real estate owned for the years ended December 31, (In thousands) 2017 2016 2015 Balance, beginning of year $ 166 $ 966 $ 5,710 OREO properties added 455 141 2,357 Sales during the year (626 ) (1,002 ) (6,719 ) Increase (decrease) in carrying amount of real estate owned 5 61 (382 ) Balance, end of year $ — $ 166 $ 966 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets and Goodwill | The table below presents goodwill and intangible assets at December 31, (In thousands) 2017 2016 Goodwill $ 11,854 $ 11,854 Core deposits intangible 642 1,026 Total $ 12,496 $ 12,880 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | Scheduled amortization of the core deposits intangible is as follows: (In thousands) Year Amount 2018 $ 305 2019 110 2020 88 2021 67 2022 45 After five years 27 $ 642 |
Deposits (Tables)
Deposits (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Banking and Thrift [Abstract] | |
Schedule of Deposit Liabilities | The following table presents the details of total deposits at December 31, % of Total % of Total (Dollars in thousands) 2017 Deposits 2016 Deposits Non-interest bearing $ 196,509 21.31 % $ 170,854 20.47 % Interest bearing 372,133 40.36 310,103 37.16 Savings 215,197 23.34 205,294 24.60 Certificates of deposit 138,167 14.99 148,265 17.77 $ 922,006 100.00 % $ 834,516 100.00 % |
Scheduled Maturities of Time Deposits | At December 31, 2017 , certificates of deposit have contractual maturities as follows: (In thousands) Year Amount 2018 $ 76,293 2019 33,238 2020 9,418 2021 12,107 2022 7,111 $ 138,167 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | The components of income tax expense (benefit) are summarized as follows for the years ended December 31, 2017, 2016 and 2015: (In thousands) 2017 2016 2015 Federal: Current $ 2,791 $ 3,360 $ 3,199 Deferred 496 269 8 Provisional remeasurement of deferred tax assets and liabilities 1,712 — — 4,999 3,629 3,207 State: Current 748 909 704 Deferred 124 85 151 872 994 855 $ 5,871 $ 4,623 $ 4,062 |
Schedule of Effective Income Tax Rate Reconciliation | A comparison of income tax expense at the Federal statutory rate in 2017 , 2016 and 2015 to the Company’s provision for income taxes is as follows: (In thousands) 2017 2016 2015 Federal income tax $ 4,352 $ 4,729 $ 4,327 Add (deduct) effect of: State income taxes net of federal income tax effect 575 656 564 Tax-exempt interest income (728 ) (706 ) (724 ) Bank-owned life insurance (177 ) (187 ) (203 ) Executive compensation 139 — — Provisional remeasurement of federal deferred tax assets and liabilities 1,712 — — Other items, net (2 ) 131 98 Provision for income taxes $ 5,871 $ 4,623 $ 4,062 |
Schedule of Deferred Tax Assets and Liabilities | The tax effects of existing temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are as follows at December 31, 2017, 2016 and 2015: (In thousands) 2017 2016 Deferred tax assets: Allowance for loan losses $ 2,253 $ 2,993 Unrealized loss on securities available for sale 137 130 Supplemental executive retirement plan liability 1,213 1,886 Other than temporary impairment loss 119 170 Depreciation 622 802 Non-accrual interest 330 313 Other 147 262 Total gross deferred tax assets $ 4,821 $ 6,556 Deferred tax liabilities: Deferred costs 540 — Pension liability 31 44 Acquisition accounting adjustments 44 52 Total gross deferred tax liabilities $ 615 $ 96 Net deferred tax assets $ 4,206 $ 6,460 |
Comprehensive Income and Accu43
Comprehensive Income and Accumulated Other Comprehensive Loss (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | The components of accumulated other comprehensive income (loss) that are included in shareholders' equity and the related tax effects are as follows at December 31, 2017 and 2016: 2017 (In thousands) Before-Tax Amount Income Tax Effect Net-of-Tax Amount Net unrealized holding loss on securities available for sale $ (571 ) $ 137 $ (434 ) Unrealized impairment loss on held to maturity security (501 ) 119 (382 ) Gains on unfunded pension liability 111 (31 ) 80 Total other comprehensive loss $ (961 ) $ 225 $ (736 ) 2016 Before-Tax Amount Income Tax Effect Net-of-Tax Amount Net unrealized holding loss on securities available for sale $ (464 ) $ 130 $ (334 ) Unrealized impairment loss on held to maturity security (501 ) 170 (331 ) Gains on unfunded pension liability 109 (44 ) 65 Total other comprehensive loss $ (856 ) $ 256 $ (600 ) Changes in the components of accumulated other comprehensive income (loss) are as follows and are presented net of tax: (In thousands) Unrealized Holding Gains (Losses) on Available for Sale Securities Unrealized Impairment Loss on Held to Maturity Security Unfunded Pension Liability Accumulated Other Comprehensive Income (Loss) Balance, December 31, 2014 $ 276 $ (331 ) $ 303 $ 248 Other comprehensive income (loss) before reclassifications (186 ) — (32 ) (218 ) Amounts reclassified from accumulated other comprehensive income — — (160 ) (160 ) Other comprehensive income (loss) (186 ) — (192 ) (378 ) Balance, December 31, 2015 90 (331 ) 111 (130 ) Other comprehensive income (loss) before reclassifications (424 ) — 52 (372 ) Amounts reclassified from accumulated other comprehensive income — — (98 ) (98 ) Other comprehensive loss (424 ) — (46 ) (470 ) Balance, December 31, 2016 (334 ) (331 ) 65 (600 ) Other comprehensive income (loss) before reclassifications 26 — 38 64 Amounts reclassified from accumulated other comprehensive income (55 ) — (36 ) (91 ) Reclassification of certain deferred tax effects (71 ) (51 ) 13 (109 ) Other comprehensive loss (100 ) (51 ) 15 (136 ) Balance, December 31, 2017 $ (434 ) $ (382 ) $ 80 $ (736 ) |
Benefit Plans (Tables)
Benefit Plans (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Retirement Benefits [Abstract] | |
Schedule of Changes in Projected Benefit Obligations | The following table sets forth the changes in benefit obligations of the Company’s Supplemental Plans for the years ended December 31, 2017 and 2016. (In thousands) 2017 2016 Change in Benefit Obligation Beginning January 1 $ 4,613 $ 4,971 Service cost 197 216 Interest cost 156 179 Actuarial gain (62 ) (83 ) Benefits paid (699 ) (670 ) Ending December 31 $ 4,205 $ 4,613 Amount Recognized in Consolidated Balance Sheets Liability for pension $ 4,316 $ 4,722 Net actuarial gain included in accumulated other comprehensive income (111 ) (109 ) Net recognized pension liability $ 4,205 $ 4,613 Information for pension plans with an accumulated benefit obligation in excess of plan assets Projected benefit obligation $ 4,205 $ 4,613 Accumulated benefit obligation 4,043 4,463 |
Schedule of Net Periodic Benefit Cost Not yet Recognized | The following table sets forth the components of net periodic benefit cost for the years ended December 31, 2017, 2016 and 2015. (In thousands) 2017 2016 2015 Service cost $ 197 $ 216 $ 267 Interest cost 156 179 183 Recognized net actuarial gain (60 ) (160 ) (266 ) Net periodic benefit cost $ 293 $ 235 $ 184 |
Schedule of Expected Benefit Payments | Management's expectation as of December 31, 2017 for the projected annual benefit payments is represented in the table below. (In thousands) 2018 $ 4,509 2019 — 2020 — 2021 — 2022 — Thereafter — $ 4,509 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Share-based Compensation, Stock Options, Activity | Transactions under the Company’s stock option plans during the year ended December 31, 2017 are summarized as follows: Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value (In thousands) Balance, January 1, 2017 165,819 $ 7.35 5.2 $ 1,882 Granted 9,900 18.65 Exercised (31,640 ) 8.05 Forfeited (1,030 ) 14.57 Expired (1,044 ) 14.86 Balance, December 31, 2017 142,005 $ 7.86 4.4 $ 1,486 Exercisable at December 31, 2017 124,141 $ 6.96 3.9 $ 1,408 |
Schedule of Options Outstanding | The following table summarizes stock options outstanding and exercisable at December 31, 2017: Outstanding Options Exercisable Options Exercise Price Range Number Average Life in Years Average Exercise Price Number Average Life in Years Average Exercise Price $5.54 to $5.63 50,975 3.8 $ 5.60 50,975 3.8 $ 5.60 $6.16 to $7.46 57,688 3.1 6.98 57,688 3.1 6.98 $9.30 to $11.98 24,442 7.1 10.70 13,698 6.8 10.43 $18.65 8,900 9.0 18.65 1,780 9.0 18.65 142,005 4.4 $ 7.86 124,141 3.9 $ 6.96 |
Fair Value Inputs, Assets, Quantitative Information | The fair value of each option and the significant weighted average assumptions used to calculate the fair value of the options granted during the years ended December 31, 2017 , 2016 and 2015 are as follows: 2017 2016 2015 Fair value of options granted $ 6.05 $ 4.65 $ 4.05 Risk-free rate of return 2.45 % 2.25 % 1.37 % Expected option life in years 7 7 7 Expected volatility 31.25 % 30.66 % 32.37 % Expected dividends (1) 1.19 % — % — % |
Schedule of Nonvested Restricted Stock Units Activity | The following table summarizes the activity in nonvested restricted shares for the year ended December 31, 2017 : Number of Shares Weighted Average Grant-Date Fair Value Balance, January 1, 2017 146,639 $ 9.02 Granted 61,900 17.96 Vested (56,507 ) 10.60 Forfeited (1,287 ) 12.49 Balance, December 31, 2017 150,745 $ 11.87 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases | As of December 31, 2017 , future minimum rental payments under non-cancelable operating leases were as follows: (In thousands) 2018 $ 1,281 2019 1,115 2020 910 2021 821 2022 710 Thereafter 2,675 $ 7,512 |
Other Operating Expenses (Table
Other Operating Expenses (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Other Income and Expenses [Abstract] | |
Schedule of Other Operating Cost and Expense, by Component | The components of other operating expenses for the years ended December 31, 2017 , 2016 and 2015 are as follows: (Dollars in thousands) 2017 2016 2015 Regulatory, professional and other consulting fees $ 2,263 $ 1,706 $ 1,681 Equipment 1,008 917 939 Telephone 389 377 449 Amortization of intangible assets 384 404 428 Insurance 373 303 324 Merger-related expenses 265 — — Supplies 259 219 248 Marketing 225 240 282 Other expenses 2,151 1,535 1,540 $ 7,317 $ 5,701 $ 5,891 |
Regulatory Capital Requiremen48
Regulatory Capital Requirements (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Banking and Thrift [Abstract] | |
Schedule of Compliance with Regulatory Capital Requirements under Banking Regulations | The Bank's actual capital amounts and ratios are presented in the following table: To Be Well Capitalized Under Prompt For Capital Corrective Actual Adequacy Purposes Action Provisions (Dollars in thousands) Amount Ratio Amount Ratio Amount Ratio As of December 31, 2017 Common equity Tier 1 $ 115,031 11.74 % $ 44,106 4.50 % $ 63,709 6.50 % Total capital to risk-weighted assets 123,044 12.55 % 78,411 8.00 % 98,014 10.00 % Tier 1 capital to risk-weighted assets 115,031 11.74 % 58,808 6.00 % 78,411 8.00 % Tier 1 leverage capital 115,031 10.96 % 41,987 4.00 % 52,484 5.00 % As of December 31, 2016 Common equity Tier 1 $ 108,606 12.13 % $ 40,302 4.50 % $ 58,214 6.50 % Total capital to risk-weighted assets 116,100 12.96 % 71,648 8.00 % 89,560 10.00 % Tier 1 capital to risk-weighted assets 108,606 12.13 % 53,736 6.00 % 71,648 8.00 % Tier 1 leverage capital 108,606 10.68 % 40,658 4.00 % 50,823 5.00 % The Company's actual capital amounts and ratios are presented in the following table: To Be Well Capitalized Under Prompt For Capital Corrective Actual Adequacy Purposes Action Provisions (Dollars in thousands) Amount Ratio Amount Ratio Amount Ratio As of December 31, 2017 Common equity Tier 1 $ 99,839 10.19 % $ 44,106 4.50 % N/A N/A Total capital to risk-weighted assets 125,852 12.84 % 78,411 8.00 % N/A N/A Tier 1 capital to risk-weighted assets 117,839 12.02 % 58,808 6.00 % N/A N/A Tier 1 leverage capital 117,839 11.23 % 41,987 4.00 % N/A N/A As of December 31, 2016 Common equity Tier 1 $ 93,101 10.40 % $ 40,302 4.50 % N/A N/A Total capital to risk-weighted assets 118,595 13.24 % 71,648 8.00 % N/A N/A Tier 1 capital to risk-weighted assets 111,101 12.41 % 53,736 6.00 % N/A N/A Tier 1 leverage capital 111,101 10.93 % 40,658 4.00 % N/A N/A |
Fair Value Disclosures (Tables)
Fair Value Disclosures (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value, Assets Measured on Recurring Basis | The following table summarizes financial assets and financial liabilities measured at fair value on a recurring basis, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value: December 31, 2017 (In thousands) Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Fair Value Securities available for sale: U.S. Treasury Securities and obligations of U.S. Government sponsored corporations ("GSE") $ — $ 1,967 $ — $ 1,967 Residential collateralized mortgage obligations - GSE — 27,325 — 27,325 Residential mortgage backed securities-GSE — 14,288 — 14,288 Obligations of state and political subdivisions — 19,720 — 19,720 Trust preferred debt securities - single issuer — 2,349 — 2,349 Corporate debt securities 16,080 11,603 — 27,683 Other debt securities — 12,126 — 12,126 Total $ 16,080 $ 89,378 $ — $ 105,458 December 31, 2016 (In thousands) Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Fair Value Securities available for sale: U.S. Treasury Securities and obligations of U.S Government sponsored corporations (“GSE”) $ — $ 3,479 $ — $ 3,479 Residential collateralized mortgage obligations - GSE — 22,560 — 22,560 Residential mortgage backed securities – GSE — 31,476 — 31,476 Obligations of state and political subdivisions — 21,400 — 21,400 Trust preferred debt securities - single issuer — 2,272 — 2,272 Corporate debt securities 12,826 8,942 — 21,768 Other debt securities — 839 — 839 Total $ 12,826 $ 90,968 $ — $ 103,794 |
Fair Value Measurements, Nonrecurring | Financial assets and financial liabilities measured at fair value on a non-recurring basis at December 31, 2017 and 2016 are as follows: (In thousands) Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Fair Value December 31, 2017 Impaired loans — — $ 8,313 $ 8,313 December 31, 2016 Impaired loans — — $ 4,130 $ 4,130 |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis, Valuation Techniques | The following table presents additional qualitative information about assets measured at fair value on a non-recurring basis and for which the Company has utilized Level 3 inputs to determine fair value: (Dollars in thousands) Fair Value Estimate Valuation Techniques Unobservable Input Range (Weighted Average) December 31, 2017 Impaired loans $ 8,313 Appraisal of collateral (1) Appraisal adjustments (2) 0.5%-100% (28.2%) December 31, 2016 Impaired loans $ 4,130 Appraisal of collateral (1) Appraisal adjustments (2) 3%-100% (29.1%) (1) Fair value is generally determined through independent appraisals of the underlying collateral, which generally include various Level 3 inputs that are not identifiable. (2) |
Fair Value, by Balance Sheet Grouping | The fair values and the carrying value of financial instruments at December 31, 2017 and 2016 were as follows: 2017 (In thousands) Carrying Value Level 1 Inputs Level 2 Inputs Level 3 Inputs Fair Value Cash and cash equivalents $ 18,754 $ 18,754 $ — $ — $ 18,754 Securities available for sale 105,458 16,080 89,378 — 105,458 Securities held to maturity 110,267 — 111,865 — 111,865 Loans held for sale 4,254 — 4,539 — 4,539 Loans 789,906 — — 784,064 784,064 SBA servicing asset 726 — 1,016 — 1,016 Interest rate lock derivative 135 — 135 — 135 Accrued interest receivable 3,478 — 3,478 — 3,478 FHLB Stock 1,490 — 1,490 — 1,490 Deposits (922,006 ) — (920,732 ) — (920,732 ) Borrowings (20,500 ) — (20,500 ) — (20,500 ) Redeemable subordinated debentures (18,557 ) — (12,326 ) — (12,326 ) Accrued interest payable (804 ) — (804 ) — (804 ) 2016 (In thousands) Carrying Value Level 1 Inputs Level 2 Inputs Level 3 Inputs Fair Value Cash and cash equivalents $ 14,886 $ 14,886 $ — $ — $ 14,886 Securities available for sale 103,794 12,826 90,968 — 103,794 Securities held to maturity 126,810 — 128,559 — 128,559 Loans held for sale 14,829 — 15,103 — 15,103 Loans 724,808 — — 716,492 716,492 SBA servicing asset 605 — 822 — 822 Interest rate lock derivative 123 — 123 — 123 Accrued interest receivable 3,095 — 3,095 — 3,095 FHLB Stock 3,962 — 3,962 — 3,962 Deposits (834,516 ) — (834,050 ) — (834,050 ) Borrowings (73,050 ) — (73,222 ) — (73,222 ) Redeemable subordinated debentures (18,557 ) — (11,922 ) — (11,922 ) Accrued interest payable (866 ) — (866 ) — (866 ) |
Parent-only Financial Informa50
Parent-only Financial Information (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Condensed Statements of Financial Condition | December 31, 2017 2016 Assets : Cash $ 317 $ 490 Investment securities 557 557 Investment in subsidiary 126,846 120,306 Other assets 2,519 2,451 Total Assets $ 130,239 $ 123,804 Liabilities And Shareholders’ Equity Other liabilities $ 29 $ 446 Subordinated debentures 18,557 18,557 Shareholders’ equity 111,653 104,801 Total Liabilities and Shareholders’ Equity $ 130,239 $ 123,804 |
Consolidated Statements of Income and Comprehensive Income | Year ended December 31, 2017 2016 2015 Income: Interest income $ 16 $ 13 $ 11 Dividend income from subsidiary 1,826 1,240 366 Total Income 1,842 1,253 377 Expense: Interest expense 535 440 366 Total Expense 535 440 366 Income before income taxes and equity in undistributed income of subsidiaries 1,307 813 11 Income tax benefit (177 ) (146 ) (122 ) Income before equity in undistributed income of subsidiaries 1,484 959 133 Equity in undistributed income of subsidiaries 5,444 8,326 8,531 Net Income 6,928 9,285 8,664 Equity in other comprehensive loss of subsidiaries (27 ) (470 ) (378 ) Comprehensive Income 6,901 8,815 8,286 |
Condensed Statements of Cash Flows | Year Ended December 31, 2017 2016 2015 Operating Activities: Net Income $ 6,928 $ 9,285 $ 8,664 Adjustments: Increase in other assets (68 ) (126 ) (92 ) (Decrease) increase in other liabilities (16 ) 408 — Equity in undistributed income of subsidiaries (5,444 ) (8,326 ) (8,531 ) Net cash provided by operating activities 1,400 1,241 41 Cash Flows From Investing Activities: Investment in subsidiary (130 ) (501 ) 37 Net cash (used in) provided by investing activities (130 ) (501 ) 37 Cash Flows From Financing Activities: Cash dividend paid (1,690 ) (399 ) — Exercise of stock options 247 96 292 Purchase of treasury stock, net — (24 ) (359 ) Net cash used in financing activities (1,443 ) (327 ) (67 ) Net (decrease) increase in cash (173 ) 413 11 Cash at beginning of year 490 77 66 Cash at end of year $ 317 $ 490 $ 77 |
Quarterly Financial Data (Una51
Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Information | The following table sets forth a condensed summary of the Company’s quarterly results of operations for the years ended December 31, 2017 , 2016 and 2015 . Selected 2017 Quarterly Data (Dollars in thousands, except per share data) December 31 September 30 June 30 March 31 Interest income $ 11,227 $ 10,811 $ 10,142 $ 9,483 Interest expense 1,418 1,451 1,340 1,289 Net interest income 9,809 9,360 8,802 8,194 Provision for loan losses 150 150 150 150 Net interest income after provision for loan losses 9,659 9,210 8,652 8,044 Non-interest income 1,930 2,112 1,785 2,413 Non-interest expense 8,064 7,609 7,677 7,656 Income before income taxes 3,525 3,713 2,760 2,801 Income taxes 2,951 1,227 841 852 Net income $ 574 $ 2,486 $ 1,919 $ 1,949 Net income per common share: (1) Basic $ 0.07 $ 0.31 $ 0.24 $ 0.24 Diluted 0.07 0.30 0.23 0.23 Selected 2016 Quarterly Data (Dollars in thousands, except per share data) December 31 September 30 June 30 March 31 Interest income $ 9,983 $ 10,399 $ 9,476 $ 9,277 Interest expense 1,361 1,355 1,257 1,185 Net interest income 8,622 9,044 8,219 8,092 Provision for loan losses — — (100 ) (200 ) Net interest income after provision for loan losses 8,622 9,044 8,319 8,292 Non-interest income 2,010 1,769 1,548 1,595 Non-interest expense 7,572 6,662 6,440 6,617 Income before income taxes 3,060 4,151 3,427 3,270 Income taxes 1,006 1,456 1,113 1,048 Net income $ 2,054 $ 2,695 $ 2,314 $ 2,222 Net income per common share: (1) Basic $ 0.26 $ 0.34 $ 0.29 $ 0.28 Diluted 0.25 0.33 0.28 0.27 Selected 2015 Quarterly Data (Dollars in thousands, except per share data) December 31 September 30 June 30 March 31 Interest income $ 9,467 $ 10,422 $ 10,143 $ 9,291 Interest expense 1,170 1,169 1,153 1,144 Net interest income 8,297 9,253 8,990 8,147 Provision for loan losses 500 100 — 500 Net interest income after provision for loan losses 7,797 9,153 8,990 7,647 Non-interest income 926 1,436 2,046 2,178 Non-interest expense 6,349 6,979 7,609 6,510 Income before income taxes 2,374 3,610 3,427 3,315 Income taxes 747 1,148 1,112 1,055 Net income $ 1,627 $ 2,462 $ 2,315 $ 2,260 Net income per common share: (1) Basic $ 0.21 $ 0.31 $ 0.29 $ 0.29 Diluted 0.20 0.30 0.29 0.28 (1) |
Summary of Significant Accoun52
Summary of Significant Accounting Policies - Narrative (Details) | 12 Months Ended | ||
Dec. 31, 2017USD ($)branch_officesegmentshares | Dec. 31, 2016USD ($)shares | Dec. 31, 2015shares | |
Summary of Significant Accounting Policies [Line Items] | |||
Number of additional branch offices | branch_office | 17 | ||
Investment in FHLB stock | $ 1,500,000 | $ 4,000,000 | |
Aggregate amount of standby letters of credit | 1,200,000 | 2,000,000 | |
Trust preferred securities | $ 215,725,000 | 230,604,000 | |
Number of reportable segments | segment | 1 | ||
Reclassification of certain deferred tax effects | $ 109,000 | ||
Percentage of revenue | 85.00% | ||
Trust Preferred Securities Subject to Mandatory Redemption [Member] | |||
Summary of Significant Accounting Policies [Line Items] | |||
Trust preferred securities | $ 18,000,000 | $ 18,000,000 | |
Equity Option [Member] | |||
Summary of Significant Accounting Policies [Line Items] | |||
Antidilutive options not included in the computation of earnings per commons share (in Shares) | shares | 8,900 | 11,088 | 25,182 |
Impaired Loans [Member] | |||
Summary of Significant Accounting Policies [Line Items] | |||
Impaired long lived assets | $ 0 | $ 0 | |
Minimum [Member] | Core Deposits [Member] | |||
Summary of Significant Accounting Policies [Line Items] | |||
Estimated lives of core deposit intangibles | 5 years | ||
Maximum [Member] | Core Deposits [Member] | |||
Summary of Significant Accounting Policies [Line Items] | |||
Estimated lives of core deposit intangibles | 10 years | ||
Building [Member] | |||
Summary of Significant Accounting Policies [Line Items] | |||
Estimated useful lives | 40 years | ||
Furniture, Fixtures and Equipment [Member] | Minimum [Member] | |||
Summary of Significant Accounting Policies [Line Items] | |||
Estimated useful lives | 3 years | ||
Furniture, Fixtures and Equipment [Member] | Maximum [Member] | |||
Summary of Significant Accounting Policies [Line Items] | |||
Estimated useful lives | 15 years | ||
Leasehold Improvements [Member] | Minimum [Member] | |||
Summary of Significant Accounting Policies [Line Items] | |||
Estimated useful lives | 3 years | ||
Leasehold Improvements [Member] | Maximum [Member] | |||
Summary of Significant Accounting Policies [Line Items] | |||
Estimated useful lives | 10 years | ||
Residential Portfolio Segment [Member] | |||
Summary of Significant Accounting Policies [Line Items] | |||
Number of residential mortgage loan production offices | branch_office | 2 | ||
Consumer Portfolio Segment [Member] | |||
Summary of Significant Accounting Policies [Line Items] | |||
Days past due when loans are charged off | 120 days | ||
Interest Rate Lock Commitments [Member] | |||
Summary of Significant Accounting Policies [Line Items] | |||
Interest rate lock derivative | $ 135,000 | $ 123,000 | |
US Government Agencies Debt Securities [Member] | |||
Summary of Significant Accounting Policies [Line Items] | |||
Percentage of total portfolio | 41.50% | ||
Municipal Bonds [Member] | |||
Summary of Significant Accounting Policies [Line Items] | |||
Percentage of total portfolio | 38.70% | ||
Corporate Debt Issues and Restricted Stock [Member] | |||
Summary of Significant Accounting Policies [Line Items] | |||
Percentage of total portfolio | 19.80% |
Summary of Significant Accoun53
Summary of Significant Accounting Policies - Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Accounting Policies [Abstract] | |||||||||||||||
Net income | $ 574 | $ 2,486 | $ 1,919 | $ 1,949 | $ 2,054 | $ 2,695 | $ 2,314 | $ 2,222 | $ 1,627 | $ 2,462 | $ 2,315 | $ 2,260 | $ 6,928 | $ 9,285 | $ 8,664 |
Basic weighted average shares outstanding (in Shares) | 8,049,981 | 7,962,121 | 7,901,278 | ||||||||||||
Plus: common stock equivalents (in Shares) | 262,803 | 215,318 | 174,474 | ||||||||||||
Diluted weighted average shares outstanding (in Shares) | 8,312,784 | 8,177,439 | 8,075,752 | ||||||||||||
Earnings per share: | |||||||||||||||
Basic (in Dollars per share) | $ 0.07 | $ 0.31 | $ 0.24 | $ 0.24 | $ 0.26 | $ 0.34 | $ 0.29 | $ 0.28 | $ 0.21 | $ 0.31 | $ 0.29 | $ 0.29 | $ 0.86 | $ 1.17 | $ 1.10 |
Diluted (in Dollars per share) | $ 0.07 | $ 0.30 | $ 0.23 | $ 0.23 | $ 0.25 | $ 0.33 | $ 0.28 | $ 0.27 | $ 0.20 | $ 0.30 | $ 0.29 | $ 0.28 | $ 0.83 | $ 1.14 | $ 1.07 |
Investment Securities - Availab
Investment Securities - Available-for-sale Securities (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Schedule of Available-for-sale Securities [Line Items] | ||
Available for sale, amortized cost | $ 106,029 | $ 104,258 |
Available for sale, gross unrealized gains | 400 | 608 |
Available for sale, gross unrealized losses | (971) | (1,072) |
Available for sale, at fair value | 105,458 | 103,794 |
US Treasury securities and obligations of US Government sponsored corporations (GSE) [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available for sale, amortized cost | 1,997 | 3,514 |
Available for sale, gross unrealized gains | 0 | 0 |
Available for sale, gross unrealized losses | (30) | (35) |
Available for sale, at fair value | 1,967 | 3,479 |
Residential collateralized mortgage obligations- GSE [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available for sale, amortized cost | 27,688 | 22,647 |
Available for sale, gross unrealized gains | 18 | 58 |
Available for sale, gross unrealized losses | (381) | (145) |
Available for sale, at fair value | 27,325 | 22,560 |
Residential mortgage backed securities - GSE [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available for sale, amortized cost | 14,231 | 31,207 |
Available for sale, gross unrealized gains | 129 | 388 |
Available for sale, gross unrealized losses | (72) | (119) |
Available for sale, at fair value | 14,288 | 31,476 |
Obligations of state and political subdivisions [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available for sale, amortized cost | 19,575 | 21,604 |
Available for sale, gross unrealized gains | 227 | 152 |
Available for sale, gross unrealized losses | (82) | (356) |
Available for sale, at fair value | 19,720 | 21,400 |
Trust preferred debt securities - single issuer [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available for sale, amortized cost | 2,481 | 2,478 |
Available for sale, gross unrealized gains | 0 | 0 |
Available for sale, gross unrealized losses | (132) | (206) |
Available for sale, at fair value | 2,349 | 2,272 |
Corporate debt securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available for sale, amortized cost | 27,917 | 21,963 |
Available for sale, gross unrealized gains | 14 | 10 |
Available for sale, gross unrealized losses | (248) | (205) |
Available for sale, at fair value | 27,683 | 21,768 |
Other debt obligations [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available for sale, amortized cost | 12,140 | 845 |
Available for sale, gross unrealized gains | 12 | 0 |
Available for sale, gross unrealized losses | (26) | (6) |
Available for sale, at fair value | $ 12,126 | $ 839 |
Investment Securities - Held-to
Investment Securities - Held-to-maturity Securities (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Schedule of Held-to-maturity Securities [Line Items] | ||
Held to maturity, amortized cost | $ 110,768 | $ 127,311 |
Held to maturity, other than temporary impairment recognized in accumulated other comprehensive loss | (501) | (501) |
Held to maturity, Carrying Value | 110,267 | 126,810 |
Held to maturity, gross unrealized gains | 1,967 | 2,364 |
Held to maturity, gross unrealized losses | (369) | (615) |
Held to maturity, fair value | 111,865 | 128,559 |
US Treasury securities and obligations of US Government sponsored corporations (GSE) [Member] | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Held to maturity, amortized cost | 3,234 | 3,727 |
Held to maturity, other than temporary impairment recognized in accumulated other comprehensive loss | 0 | 0 |
Held to maturity, Carrying Value | 3,234 | 3,727 |
Held to maturity, gross unrealized gains | 0 | 0 |
Held to maturity, gross unrealized losses | (84) | (116) |
Held to maturity, fair value | 3,150 | 3,611 |
Residential collateralized mortgage obligations- GSE [Member] | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Held to maturity, amortized cost | 8,701 | 11,882 |
Held to maturity, other than temporary impairment recognized in accumulated other comprehensive loss | 0 | 0 |
Held to maturity, Carrying Value | 8,701 | 11,882 |
Held to maturity, gross unrealized gains | 94 | 247 |
Held to maturity, gross unrealized losses | (123) | (130) |
Held to maturity, fair value | 8,672 | 11,999 |
Residential mortgage backed securities - GSE [Member] | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Held to maturity, amortized cost | 34,072 | 40,565 |
Held to maturity, other than temporary impairment recognized in accumulated other comprehensive loss | 0 | 0 |
Held to maturity, Carrying Value | 34,072 | 40,565 |
Held to maturity, gross unrealized gains | 231 | 540 |
Held to maturity, gross unrealized losses | (127) | (113) |
Held to maturity, fair value | 34,176 | 40,992 |
Obligations of state and political subdivisions [Member] | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Held to maturity, amortized cost | 63,797 | 70,017 |
Held to maturity, other than temporary impairment recognized in accumulated other comprehensive loss | 0 | 0 |
Held to maturity, Carrying Value | 63,797 | 70,017 |
Held to maturity, gross unrealized gains | 1,224 | 1,274 |
Held to maturity, gross unrealized losses | (35) | (255) |
Held to maturity, fair value | 64,986 | 71,036 |
Trust preferred debt securities - pooled [Member] | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Held to maturity, amortized cost | 657 | 657 |
Held to maturity, other than temporary impairment recognized in accumulated other comprehensive loss | (501) | (501) |
Held to maturity, Carrying Value | 156 | 156 |
Held to maturity, gross unrealized gains | 418 | 303 |
Held to maturity, gross unrealized losses | 0 | 0 |
Held to maturity, fair value | 574 | 459 |
Other debt obligations [Member] | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Held to maturity, amortized cost | 307 | 463 |
Held to maturity, other than temporary impairment recognized in accumulated other comprehensive loss | 0 | 0 |
Held to maturity, Carrying Value | 307 | 463 |
Held to maturity, gross unrealized gains | 0 | 0 |
Held to maturity, gross unrealized losses | 0 | (1) |
Held to maturity, fair value | $ 307 | $ 462 |
Investment Securities - Summary
Investment Securities - Summary of Investments Sold (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Available for Sale | |||
Available for sale | $ 7,602 | $ 0 | $ 0 |
Gross gains | 120 | ||
Gross losses | (27) | ||
Net tax expense | 31 | ||
Held to Maturity | |||
Held to maturity | 1,034 | 0 | 0 |
Net gain on held-to-maturity securities | 36 | $ 0 | $ 0 |
Net tax expense | $ 12 |
Investment Securities - Securit
Investment Securities - Securities by Contractual Maturity (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Available for sale | ||
Due in one year or less, Amortized Cost | $ 473 | |
Due in one year or less, Fair Value | $ 473 | |
Due in one year or less, Percentage Yield | 1.84% | |
Due after one year through five years, Amortized Cost | $ 24,661 | |
Due after one year through five years, Fair Value | $ 24,612 | |
Due after one year through five years, Percentage Yield | 2.54% | |
Due after five years through ten years, Amortized Cost | $ 27,307 | |
Due after five years through ten years, Fair Value | $ 27,131 | |
Due after five years through ten years, Percentage Yield | 2.72% | |
Due after ten years, Amortized Cost | $ 53,588 | |
Due after ten years, Fair Value | $ 53,242 | |
Due after ten years, Percentage Yield | 2.69% | |
Total, Amortized Cost | $ 106,029 | |
Total, Fair Value | $ 105,458 | $ 103,794 |
Total, Percentage Yield | 2.66% | |
Held to maturity | ||
Due in one year or less, Carrying Value | $ 28,750 | |
Due in one year or less, Fair Value | $ 28,780 | |
Due in one year or less, Percentage Yield | 1.89% | |
Due after one year through five years, Carrying Value | $ 17,793 | |
Due after one year through five years, Fair Value | $ 18,419 | |
Due after one year through five years, Percentage Yield | 4.85% | |
Due after five years through ten years, Carrying Value | $ 18,845 | |
Due after five years through ten years, Fair Value | $ 19,235 | |
Due after five years through ten years, Percentage Yield | 3.55% | |
Due after ten years, Carrying Value | $ 44,879 | |
Due after ten years, Fair Value | $ 45,431 | |
Due after ten years, Percentage Yield | 3.09% | |
Held to maturity, Carrying Value | $ 110,267 | 126,810 |
Total, Fair Value | $ 111,865 | $ 128,559 |
Total, Percentage Yield | 3.14% |
Investment Securities - Secur58
Investment Securities - Securities in a Continuous Unrealized Loss Position (Details) $ in Thousands | Dec. 31, 2017USD ($)security | Dec. 31, 2016USD ($)security |
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Securities in a continuous unrealized loss position, number | security | 105 | 126 |
Securities in a continuous unrealized loss position, less than 12 months, fair value | $ 75,375 | $ 89,158 |
Securities in a continuous unrealized loss position, less than 12 months, unrealized losses | (581) | (1,457) |
Securities in a continuous unrealized loss position, 12 months or longer, fair value | 27,761 | 9,089 |
Securities in a continuous unrealized loss position, 12 months or longer, unrealized losses | (759) | (230) |
Securities in a continuous unrealized loss position, fair value | 103,136 | 98,247 |
Securities in a continuous unrealized loss position, unrealized losses | $ (1,340) | $ (1,687) |
US Treasury securities and obligations of US Government sponsored corporations (GSE) [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Securities in a continuous unrealized loss position, number | security | 2 | 3 |
Securities in a continuous unrealized loss position, less than 12 months, fair value | $ 1,967 | $ 7,090 |
Securities in a continuous unrealized loss position, less than 12 months, unrealized losses | (30) | (151) |
Securities in a continuous unrealized loss position, 12 months or longer, fair value | 3,150 | 0 |
Securities in a continuous unrealized loss position, 12 months or longer, unrealized losses | (84) | 0 |
Securities in a continuous unrealized loss position, fair value | 5,117 | 7,090 |
Securities in a continuous unrealized loss position, unrealized losses | $ (114) | $ (151) |
Residential collateralized mortgage obligations- GSE [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Securities in a continuous unrealized loss position, number | security | 11 | 7 |
Securities in a continuous unrealized loss position, less than 12 months, fair value | $ 19,237 | $ 17,242 |
Securities in a continuous unrealized loss position, less than 12 months, unrealized losses | (205) | (275) |
Securities in a continuous unrealized loss position, 12 months or longer, fair value | 8,788 | 0 |
Securities in a continuous unrealized loss position, 12 months or longer, unrealized losses | (299) | 0 |
Securities in a continuous unrealized loss position, fair value | 28,025 | 17,242 |
Securities in a continuous unrealized loss position, unrealized losses | $ (504) | $ (275) |
Residential mortgage backed securities - GSE [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Securities in a continuous unrealized loss position, number | security | 35 | 29 |
Securities in a continuous unrealized loss position, less than 12 months, fair value | $ 21,770 | $ 26,581 |
Securities in a continuous unrealized loss position, less than 12 months, unrealized losses | (141) | (216) |
Securities in a continuous unrealized loss position, 12 months or longer, fair value | 3,074 | 3,542 |
Securities in a continuous unrealized loss position, 12 months or longer, unrealized losses | (58) | (16) |
Securities in a continuous unrealized loss position, fair value | 24,844 | 30,123 |
Securities in a continuous unrealized loss position, unrealized losses | $ (199) | $ (232) |
Obligations of state and political subdivisions [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Securities in a continuous unrealized loss position, number | security | 42 | 74 |
Securities in a continuous unrealized loss position, less than 12 months, fair value | $ 11,594 | $ 25,545 |
Securities in a continuous unrealized loss position, less than 12 months, unrealized losses | (82) | (611) |
Securities in a continuous unrealized loss position, 12 months or longer, fair value | 2,717 | 0 |
Securities in a continuous unrealized loss position, 12 months or longer, unrealized losses | (35) | 0 |
Securities in a continuous unrealized loss position, fair value | 14,311 | 25,545 |
Securities in a continuous unrealized loss position, unrealized losses | $ (117) | $ (611) |
Trust preferred debt securities - single issuer [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Securities in a continuous unrealized loss position, number | security | 4 | 4 |
Securities in a continuous unrealized loss position, less than 12 months, fair value | $ 0 | $ 0 |
Securities in a continuous unrealized loss position, less than 12 months, unrealized losses | 0 | 0 |
Securities in a continuous unrealized loss position, 12 months or longer, fair value | 2,349 | 2,272 |
Securities in a continuous unrealized loss position, 12 months or longer, unrealized losses | (132) | (206) |
Securities in a continuous unrealized loss position, fair value | 2,349 | 2,272 |
Securities in a continuous unrealized loss position, unrealized losses | $ (132) | $ (206) |
Corporate debt securities [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Securities in a continuous unrealized loss position, number | security | 7 | 6 |
Securities in a continuous unrealized loss position, less than 12 months, fair value | $ 11,967 | $ 12,700 |
Securities in a continuous unrealized loss position, less than 12 months, unrealized losses | (98) | (204) |
Securities in a continuous unrealized loss position, 12 months or longer, fair value | 7,662 | 1,999 |
Securities in a continuous unrealized loss position, 12 months or longer, unrealized losses | (150) | (1) |
Securities in a continuous unrealized loss position, fair value | 19,629 | 14,699 |
Securities in a continuous unrealized loss position, unrealized losses | $ (248) | $ (205) |
Other debt obligations [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Securities in a continuous unrealized loss position, number | security | 4 | 3 |
Securities in a continuous unrealized loss position, less than 12 months, fair value | $ 8,840 | $ 0 |
Securities in a continuous unrealized loss position, less than 12 months, unrealized losses | (25) | 0 |
Securities in a continuous unrealized loss position, 12 months or longer, fair value | 21 | 1,276 |
Securities in a continuous unrealized loss position, 12 months or longer, unrealized losses | (1) | (7) |
Securities in a continuous unrealized loss position, fair value | 8,861 | 1,276 |
Securities in a continuous unrealized loss position, unrealized losses | $ (26) | $ (7) |
Investment Securities - Narrati
Investment Securities - Narrative (Details) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2017USD ($)securityfinancial_institution | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2009USD ($) | |
Schedule of Available-for-sale Securities [Line Items] | ||||
Proceeds from sales of marketable securities | $ 8,500 | |||
Net gain on marketable securities | 129 | |||
Proceeds from sales of securities held to maturity | 1,034 | $ 0 | $ 0 | |
Net gain on held-to-maturity securities | $ 36 | 0 | $ 0 | |
Percentage of original principal balance outstanding at the time of purchase (less than 15%) | 15.00% | |||
Other than temporary impairment | $ 865 | |||
Other than temporary impairment loss, portion recognized in earnings | 364 | |||
Other than temporary impairment loss, portion recognized in other comprehensive income (loss) | $ 501 | |||
Trust preferred debt securities - single issuer [Member] | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Number of corporate trust preferred securities | security | 4 | |||
Number of issuers | financial_institution | 2 | |||
Trust preferred debt securities - pooled [Member] | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Number of issuers | financial_institution | 2 | |||
Federal Home Loan Bank Borrowings [Member] | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Investment securities pledged to collateralize borrowings and municipal deposits | $ 98,400 | $ 121,700 |
Loans and Loans Held for Sale -
Loans and Loans Held for Sale - Summary of Loans (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Gross Loans | $ 789,356 | $ 723,071 |
Deferred loan costs, net | 550 | 1,737 |
Loans | 789,906 | 724,808 |
Commercial real estate [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Gross Loans | 308,924 | 242,184 |
Mortgage warehouse lines [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Gross Loans | 189,412 | 216,259 |
Construction loans [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Gross Loans | 136,412 | 96,035 |
Commercial business [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Gross Loans | 92,906 | 99,859 |
Residential real estate loans [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Gross Loans | 40,494 | 44,791 |
Loans to individuals [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Gross Loans | 21,025 | 23,736 |
Other [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Gross Loans | $ 183 | $ 207 |
Loans and Loans Held for Sale61
Loans and Loans Held for Sale - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Receivables [Abstract] | ||
Residential real estate | $ 2,269 | $ 14,829 |
Derivative [Line Items] | ||
Loans sold to others and serviced by Company | 42,300 | 32,600 |
Servicing asset | $ 726 | 605 |
Discount rate | 10.25% | |
Excess servicing rate | 12.50% | |
Prepayment speed rate | 8.50% | |
Discount on unsold SBA loans | $ 863 | 756 |
Interest Rate Lock Commitments [Member] | ||
Derivative [Line Items] | ||
Interest rate lock derivative | $ 135 | $ 123 |
Loans and Loans Held for Sale62
Loans and Loans Held for Sale - Summary of Loans by Type (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Receivables [Abstract] | ||
Residential real estate | $ 2,269 | $ 14,829 |
SBA | 1,985 | 0 |
Loans held for sale | $ 4,254 | $ 14,829 |
Loans and Loans Held for Sale63
Loans and Loans Held for Sale - Changes in Servicing Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Servicing Asset at Amortized Cost, Balance [Roll Forward] | ||
Balance, beginning of year | $ 605 | $ 345 |
Servicing assets capitalized | 302 | 377 |
Amortization expense | (181) | (117) |
Balance, end of year | $ 726 | $ 605 |
Allowance for Loan Losses and64
Allowance for Loan Losses and Credit Quality Disclosures - Aging of Loan Portfolio (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | $ 5,820 | $ 6,940 |
Current | 783,536 | 716,131 |
Total Loans Receivable | 789,356 | 723,071 |
Deferred loan costs, net | 550 | 1,737 |
Loans | 789,906 | 724,808 |
Recorded Investment 90 Days Accruing | 0 | 24 |
Non-accrual Loans | 7,114 | 5,174 |
Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 1,750 | 1,418 |
Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 801 | 144 |
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 3,269 | 4,436 |
Commercial Real Estate [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Loans Receivable | 308,924 | 242,184 |
Mortgage Warehouse Lines [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Loans Receivable | 189,412 | 216,259 |
Construction Loans [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Loans Receivable | 136,412 | 96,035 |
Commercial Business [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Loans Receivable | 92,906 | 99,859 |
Residential Real Estate Loans [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Loans Receivable | 40,494 | 44,791 |
Loans to Individuals [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Loans Receivable | 21,025 | 23,736 |
Commercial Portfolio Segment [Member] | Commercial Real Estate [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 3,005 | 4,390 |
Current | 305,919 | 237,794 |
Total Loans Receivable | 308,924 | 242,184 |
Recorded Investment 90 Days Accruing | 0 | 0 |
Non-accrual Loans | 2,465 | 3,187 |
Commercial Portfolio Segment [Member] | Commercial Real Estate [Member] | Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 540 | 741 |
Commercial Portfolio Segment [Member] | Commercial Real Estate [Member] | Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 0 | 942 |
Commercial Portfolio Segment [Member] | Commercial Real Estate [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 2,465 | 2,707 |
Commercial Portfolio Segment [Member] | Mortgage Warehouse Lines [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 0 | 0 |
Current | 189,412 | 216,259 |
Total Loans Receivable | 189,412 | 216,259 |
Recorded Investment 90 Days Accruing | 0 | 0 |
Non-accrual Loans | 0 | 0 |
Commercial Portfolio Segment [Member] | Mortgage Warehouse Lines [Member] | Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 0 | 0 |
Commercial Portfolio Segment [Member] | Mortgage Warehouse Lines [Member] | Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 0 | 0 |
Commercial Portfolio Segment [Member] | Mortgage Warehouse Lines [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 0 | 0 |
Commercial Portfolio Segment [Member] | Construction Loans [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 0 | 186 |
Current | 136,412 | 95,849 |
Total Loans Receivable | 136,412 | 96,035 |
Recorded Investment 90 Days Accruing | 0 | 0 |
Non-accrual Loans | 0 | 186 |
Commercial Portfolio Segment [Member] | Construction Loans [Member] | Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 0 | 0 |
Commercial Portfolio Segment [Member] | Construction Loans [Member] | Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 0 | 0 |
Commercial Portfolio Segment [Member] | Construction Loans [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 0 | 186 |
Commercial Portfolio Segment [Member] | Commercial Business [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 1,344 | 1,018 |
Current | 91,562 | 98,841 |
Total Loans Receivable | 92,906 | 99,859 |
Recorded Investment 90 Days Accruing | 0 | 0 |
Non-accrual Loans | 4,212 | 920 |
Commercial Portfolio Segment [Member] | Commercial Business [Member] | Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 180 | 113 |
Commercial Portfolio Segment [Member] | Commercial Business [Member] | Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 545 | 115 |
Commercial Portfolio Segment [Member] | Commercial Business [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 619 | 790 |
Commercial Portfolio Segment [Member] | Residential Real Estate Loans [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Loans Receivable | 40,494 | 44,791 |
Consumer Portfolio Segment [Member] | Residential Real Estate Loans [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 1,236 | 956 |
Current | 39,258 | 43,835 |
Total Loans Receivable | 40,494 | 44,791 |
Recorded Investment 90 Days Accruing | 0 | 0 |
Non-accrual Loans | 69 | 544 |
Consumer Portfolio Segment [Member] | Residential Real Estate Loans [Member] | Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 911 | 564 |
Consumer Portfolio Segment [Member] | Residential Real Estate Loans [Member] | Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 256 | 0 |
Consumer Portfolio Segment [Member] | Residential Real Estate Loans [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 69 | 392 |
Consumer Portfolio Segment [Member] | Loans to Individuals [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 235 | 390 |
Current | 20,790 | 23,346 |
Total Loans Receivable | 21,025 | 23,736 |
Recorded Investment 90 Days Accruing | 0 | 24 |
Non-accrual Loans | 368 | 337 |
Consumer Portfolio Segment [Member] | Loans to Individuals [Member] | Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 119 | 0 |
Consumer Portfolio Segment [Member] | Loans to Individuals [Member] | Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 0 | 29 |
Consumer Portfolio Segment [Member] | Loans to Individuals [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 116 | 361 |
Consumer Portfolio Segment [Member] | Other [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 0 | 0 |
Current | 183 | 207 |
Total Loans Receivable | 183 | 207 |
Recorded Investment 90 Days Accruing | 0 | 0 |
Non-accrual Loans | 0 | 0 |
Consumer Portfolio Segment [Member] | Other [Member] | Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 0 | 0 |
Consumer Portfolio Segment [Member] | Other [Member] | Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 0 | 0 |
Consumer Portfolio Segment [Member] | Other [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | $ 0 | $ 0 |
Allowance for Loan Losses and65
Allowance for Loan Losses and Credit Quality Disclosures - Narrative (Details) | 12 Months Ended | |||
Dec. 31, 2017USD ($)loan | Dec. 31, 2016USD ($)loan | Dec. 31, 2015USD ($) | Feb. 07, 2014USD ($) | |
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||
Additional income before taxes if interest on all loans had been recorded based upon original contract terms | $ 514,000 | $ 522,000 | $ 471,000 | |
Loans deemed to be PCI in conjunction with the Rumson merger | 3,288,000 | 3,030,000 | ||
Amount of PCI loans | $ 0 | 0 | ||
Amount of troubled debt restructuring | $ 458,000 | |||
Number of troubled debt restructurings that subsequently defaulted | loan | 0 | 1 | ||
Receivables Acquired with Deteriorated Credit Quality [Member] | ||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||
Carrying amount | $ 860,000 | $ 1,121,000 | ||
Receivables Acquired with Deteriorated Credit Quality [Member] | Rumson Fair Haven Bank and Trust Company [Member] | ||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||
Loans deemed to be PCI in conjunction with the Rumson merger | $ 2,600,000 | |||
Receivables Acquired with Deteriorated Credit Quality [Member] | Performing [Member] | ||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||
Carrying amount | $ 0 | $ 439,000 | ||
One Unspecified Receivable Acquired with Deteriorated Credit Quality [Member] | ||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||
Amount of PCI loans | $ 64,000 |
Allowance for Loan Losses and66
Allowance for Loan Losses and Credit Quality Disclosures - Commercial Loans by Credit Quality Indicators (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | $ 789,356 | $ 723,071 |
Construction Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 136,412 | 96,035 |
Commercial Business [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 92,906 | 99,859 |
Commercial Real Estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 308,924 | 242,184 |
Mortgage Warehouse Lines [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 189,412 | 216,259 |
Residential Real Estate Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 40,494 | 44,791 |
Commercial Portfolio Segment [Member] | Construction Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 136,412 | 96,035 |
Commercial Portfolio Segment [Member] | Construction Loans [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 136,180 | 95,548 |
Commercial Portfolio Segment [Member] | Construction Loans [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 232 | 301 |
Commercial Portfolio Segment [Member] | Construction Loans [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 0 | 186 |
Commercial Portfolio Segment [Member] | Construction Loans [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 0 | 0 |
Commercial Portfolio Segment [Member] | Commercial Business [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 92,906 | 99,859 |
Commercial Portfolio Segment [Member] | Commercial Business [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 84,746 | 92,117 |
Commercial Portfolio Segment [Member] | Commercial Business [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 3,454 | 7,102 |
Commercial Portfolio Segment [Member] | Commercial Business [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 1,252 | 611 |
Commercial Portfolio Segment [Member] | Commercial Business [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 3,454 | 29 |
Commercial Portfolio Segment [Member] | Commercial Real Estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 308,924 | 242,184 |
Commercial Portfolio Segment [Member] | Commercial Real Estate [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 289,203 | 223,226 |
Commercial Portfolio Segment [Member] | Commercial Real Estate [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 13,267 | 14,334 |
Commercial Portfolio Segment [Member] | Commercial Real Estate [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 6,454 | 4,624 |
Commercial Portfolio Segment [Member] | Commercial Real Estate [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 0 | 0 |
Commercial Portfolio Segment [Member] | Mortgage Warehouse Lines [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 189,412 | 216,259 |
Commercial Portfolio Segment [Member] | Mortgage Warehouse Lines [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 189,412 | 216,259 |
Commercial Portfolio Segment [Member] | Mortgage Warehouse Lines [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 0 | 0 |
Commercial Portfolio Segment [Member] | Mortgage Warehouse Lines [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 0 | 0 |
Commercial Portfolio Segment [Member] | Mortgage Warehouse Lines [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 0 | 0 |
Commercial Portfolio Segment [Member] | Residential Real Estate Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 40,494 | 44,791 |
Commercial Portfolio Segment [Member] | Residential Real Estate Loans [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 39,539 | 43,950 |
Commercial Portfolio Segment [Member] | Residential Real Estate Loans [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 666 | 244 |
Commercial Portfolio Segment [Member] | Residential Real Estate Loans [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 289 | 597 |
Commercial Portfolio Segment [Member] | Residential Real Estate Loans [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | $ 0 | $ 0 |
Allowance for Loan Losses and67
Allowance for Loan Losses and Credit Quality Disclosures - Consumer Loans by Credit Quality Indicators (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | $ 789,356 | $ 723,071 |
Loans to Individuals [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 21,025 | 23,736 |
Consumer Portfolio Segment [Member] | Loans to Individuals [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 21,025 | 23,736 |
Consumer Portfolio Segment [Member] | Other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 183 | 207 |
Consumer Portfolio Segment [Member] | Performing [Member] | Loans to Individuals [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 20,657 | 23,375 |
Consumer Portfolio Segment [Member] | Performing [Member] | Other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 183 | 207 |
Consumer Portfolio Segment [Member] | Nonperforming [Member] | Loans to Individuals [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | 368 | 361 |
Consumer Portfolio Segment [Member] | Nonperforming [Member] | Other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Amount of loans | $ 0 | $ 0 |
Allowance for Loan Losses and68
Allowance for Loan Losses and Credit Quality Disclosures - Allowance for Loan Losses (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Allowance for loan losses: | |||||||||||||||
Beginning balance | $ 7,494 | $ 7,560 | $ 6,925 | $ 7,494 | $ 7,560 | $ 6,925 | |||||||||
Provision (credit) for loan losses | $ 150 | $ 150 | $ 150 | 150 | $ 0 | $ 0 | $ (100) | (200) | $ 500 | $ 100 | $ 0 | 500 | 600 | (300) | 1,100 |
Loans charged off | (162) | (158) | (491) | ||||||||||||
Recoveries of loans charged off | 81 | 392 | 26 | ||||||||||||
Ending balance | 8,013 | 7,494 | 7,560 | 8,013 | 7,494 | 7,560 | |||||||||
Allowance for credit losses: Individually evaluated | 684 | 260 | 684 | 260 | |||||||||||
Allowance for credit losses: Collectively evaluated for impairment | 7,329 | 7,234 | 7,329 | 7,234 | |||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 789,356 | 723,071 | 789,356 | 723,071 | |||||||||||
Individually evaluated for impairment | 10,841 | 6,036 | 10,841 | 6,036 | |||||||||||
Collectively evaluated for impairment | 778,201 | 717,651 | 778,201 | 717,651 | |||||||||||
Deferred loan costs, net | 550 | 1,737 | 550 | 1,737 | |||||||||||
Loans | 789,906 | 724,808 | 789,906 | 724,808 | |||||||||||
Receivables Acquired with Deteriorated Credit Quality [Member] | |||||||||||||||
Loans receivable: | |||||||||||||||
Loans | 864 | 1,121 | 864 | 1,121 | |||||||||||
Construction Loans [Member] | |||||||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 136,412 | 96,035 | 136,412 | 96,035 | |||||||||||
Commercial Business [Member] | |||||||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 92,906 | 99,859 | 92,906 | 99,859 | |||||||||||
Commercial Real Estate [Member] | |||||||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 308,924 | 242,184 | 308,924 | 242,184 | |||||||||||
Mortgage Warehouse Lines [Member] | |||||||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 189,412 | 216,259 | 189,412 | 216,259 | |||||||||||
Residential Real Estate Loans [Member] | |||||||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 40,494 | 44,791 | 40,494 | 44,791 | |||||||||||
Loans to Individuals [Member] | |||||||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 21,025 | 23,736 | 21,025 | 23,736 | |||||||||||
Commercial Portfolio Segment [Member] | Construction Loans [Member] | |||||||||||||||
Allowance for loan losses: | |||||||||||||||
Beginning balance | 1,204 | 1,025 | 1,215 | 1,204 | 1,025 | 1,215 | |||||||||
Provision (credit) for loan losses | 499 | 179 | (190) | ||||||||||||
Loans charged off | 0 | 0 | 0 | ||||||||||||
Recoveries of loans charged off | 0 | 0 | 0 | ||||||||||||
Ending balance | 1,703 | 1,204 | 1,025 | 1,703 | 1,204 | 1,025 | |||||||||
Allowance for credit losses: Individually evaluated | 0 | 7 | 0 | 7 | |||||||||||
Allowance for credit losses: Collectively evaluated for impairment | 1,703 | 1,197 | 1,703 | 1,197 | |||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 136,412 | 96,035 | 136,412 | 96,035 | |||||||||||
Individually evaluated for impairment | 232 | 391 | 232 | 391 | |||||||||||
Collectively evaluated for impairment | 136,180 | 95,644 | 136,180 | 95,644 | |||||||||||
Commercial Portfolio Segment [Member] | Construction Loans [Member] | Receivables Acquired with Deteriorated Credit Quality [Member] | |||||||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 0 | 0 | 0 | 0 | |||||||||||
Commercial Portfolio Segment [Member] | Commercial Business [Member] | |||||||||||||||
Allowance for loan losses: | |||||||||||||||
Beginning balance | 1,732 | 2,005 | 1,761 | 1,732 | 2,005 | 1,761 | |||||||||
Provision (credit) for loan losses | 2 | (177) | 347 | ||||||||||||
Loans charged off | (61) | (97) | (116) | ||||||||||||
Recoveries of loans charged off | 47 | 1 | 13 | ||||||||||||
Ending balance | 1,720 | 1,732 | 2,005 | 1,720 | 1,732 | 2,005 | |||||||||
Allowance for credit losses: Individually evaluated | 592 | 101 | 592 | 101 | |||||||||||
Allowance for credit losses: Collectively evaluated for impairment | 1,128 | 1,631 | 1,128 | 1,631 | |||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 92,906 | 99,859 | 92,906 | 99,859 | |||||||||||
Individually evaluated for impairment | 4,459 | 947 | 4,459 | 947 | |||||||||||
Collectively evaluated for impairment | 88,173 | 98,721 | 88,173 | 98,721 | |||||||||||
Commercial Portfolio Segment [Member] | Commercial Business [Member] | Receivables Acquired with Deteriorated Credit Quality [Member] | |||||||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 274 | 191 | 274 | 191 | |||||||||||
Commercial Portfolio Segment [Member] | Commercial Real Estate [Member] | |||||||||||||||
Allowance for loan losses: | |||||||||||||||
Beginning balance | 2,574 | 3,049 | 2,393 | 2,574 | 3,049 | 2,393 | |||||||||
Provision (credit) for loan losses | 358 | (800) | 1,010 | ||||||||||||
Loans charged off | 0 | (60) | (361) | ||||||||||||
Recoveries of loans charged off | 17 | 385 | 7 | ||||||||||||
Ending balance | 2,949 | 2,574 | 3,049 | 2,949 | 2,574 | 3,049 | |||||||||
Allowance for credit losses: Individually evaluated | 92 | 114 | 92 | 114 | |||||||||||
Allowance for credit losses: Collectively evaluated for impairment | 2,460 | 2,460 | 2,460 | 2,460 | |||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 308,924 | 242,184 | 308,924 | 242,184 | |||||||||||
Individually evaluated for impairment | 5,713 | 3,817 | 5,713 | 3,817 | |||||||||||
Collectively evaluated for impairment | 302,621 | 237,437 | 302,621 | 237,437 | |||||||||||
Commercial Portfolio Segment [Member] | Commercial Real Estate [Member] | Receivables Acquired with Deteriorated Credit Quality [Member] | |||||||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 590 | 930 | 590 | 930 | |||||||||||
Commercial Portfolio Segment [Member] | Mortgage Warehouse Lines [Member] | |||||||||||||||
Allowance for loan losses: | |||||||||||||||
Beginning balance | 973 | 866 | 896 | 973 | 866 | 896 | |||||||||
Provision (credit) for loan losses | (121) | 107 | (30) | ||||||||||||
Loans charged off | 0 | 0 | 0 | ||||||||||||
Recoveries of loans charged off | 0 | 0 | 0 | ||||||||||||
Ending balance | 852 | 973 | 866 | 852 | 973 | 866 | |||||||||
Allowance for credit losses: Individually evaluated | 0 | 0 | 0 | 0 | |||||||||||
Allowance for credit losses: Collectively evaluated for impairment | 852 | 973 | 852 | 973 | |||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 189,412 | 216,259 | 189,412 | 216,259 | |||||||||||
Individually evaluated for impairment | 0 | 0 | 0 | 0 | |||||||||||
Collectively evaluated for impairment | 189,412 | 216,259 | 189,412 | 216,259 | |||||||||||
Commercial Portfolio Segment [Member] | Mortgage Warehouse Lines [Member] | Receivables Acquired with Deteriorated Credit Quality [Member] | |||||||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 0 | 0 | 0 | 0 | |||||||||||
Commercial Portfolio Segment [Member] | Residential Real Estate Loans [Member] | |||||||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 40,494 | 44,791 | 40,494 | 44,791 | |||||||||||
Consumer Portfolio Segment [Member] | Residential Real Estate Loans [Member] | |||||||||||||||
Allowance for loan losses: | |||||||||||||||
Beginning balance | 367 | 288 | 197 | 367 | 288 | 197 | |||||||||
Provision (credit) for loan losses | 126 | 79 | 91 | ||||||||||||
Loans charged off | (101) | 0 | 0 | ||||||||||||
Recoveries of loans charged off | 0 | 0 | 0 | ||||||||||||
Ending balance | 392 | 367 | 288 | 392 | 367 | 288 | |||||||||
Allowance for credit losses: Individually evaluated | 0 | 38 | 0 | 38 | |||||||||||
Allowance for credit losses: Collectively evaluated for impairment | 392 | 329 | 392 | 329 | |||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 40,494 | 44,791 | 40,494 | 44,791 | |||||||||||
Individually evaluated for impairment | 69 | 544 | 69 | 544 | |||||||||||
Collectively evaluated for impairment | 40,425 | 44,247 | 40,425 | 44,247 | |||||||||||
Consumer Portfolio Segment [Member] | Residential Real Estate Loans [Member] | Receivables Acquired with Deteriorated Credit Quality [Member] | |||||||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 0 | 0 | 0 | 0 | |||||||||||
Consumer Portfolio Segment [Member] | Loans to Individuals [Member] | |||||||||||||||
Allowance for loan losses: | |||||||||||||||
Beginning balance | 112 | 109 | 129 | 112 | 109 | 129 | |||||||||
Provision (credit) for loan losses | (2) | (3) | (13) | ||||||||||||
Loans charged off | 0 | 0 | (13) | ||||||||||||
Recoveries of loans charged off | 4 | 6 | 6 | ||||||||||||
Ending balance | 114 | 112 | 109 | 114 | 112 | 109 | |||||||||
Allowance for credit losses: Individually evaluated | 0 | 0 | 0 | 0 | |||||||||||
Allowance for credit losses: Collectively evaluated for impairment | 114 | 112 | 114 | 112 | |||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 21,025 | 23,736 | 21,025 | 23,736 | |||||||||||
Individually evaluated for impairment | 368 | 337 | 368 | 337 | |||||||||||
Collectively evaluated for impairment | 20,657 | 23,399 | 20,657 | 23,399 | |||||||||||
Consumer Portfolio Segment [Member] | Loans to Individuals [Member] | Receivables Acquired with Deteriorated Credit Quality [Member] | |||||||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 0 | 0 | 0 | 0 | |||||||||||
Consumer Portfolio Segment [Member] | Other [Member] | |||||||||||||||
Allowance for loan losses: | |||||||||||||||
Beginning balance | 0 | 0 | 2 | 0 | 0 | 2 | |||||||||
Provision (credit) for loan losses | (13) | 1 | (1) | ||||||||||||
Loans charged off | 0 | (1) | (1) | ||||||||||||
Recoveries of loans charged off | 13 | 0 | |||||||||||||
Ending balance | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||
Allowance for credit losses: Individually evaluated | 0 | 0 | 0 | 0 | |||||||||||
Allowance for credit losses: Collectively evaluated for impairment | 0 | 0 | 0 | 0 | |||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 183 | 207 | 183 | 207 | |||||||||||
Individually evaluated for impairment | 0 | 0 | 0 | 0 | |||||||||||
Collectively evaluated for impairment | 183 | 207 | 183 | 207 | |||||||||||
Consumer Portfolio Segment [Member] | Other [Member] | Receivables Acquired with Deteriorated Credit Quality [Member] | |||||||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 0 | 0 | 0 | 0 | |||||||||||
Unallocated [Member] | |||||||||||||||
Allowance for loan losses: | |||||||||||||||
Beginning balance | $ 532 | $ 218 | $ 332 | 532 | 218 | 332 | |||||||||
Provision (credit) for loan losses | (249) | 314 | (114) | ||||||||||||
Loans charged off | 0 | 0 | 0 | ||||||||||||
Recoveries of loans charged off | 0 | 0 | 0 | ||||||||||||
Ending balance | 283 | 532 | $ 218 | 283 | 532 | $ 218 | |||||||||
Allowance for credit losses: Individually evaluated | 0 | 0 | 0 | 0 | |||||||||||
Allowance for credit losses: Collectively evaluated for impairment | 283 | 532 | 283 | 532 | |||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | 0 | 0 | 0 | 0 | |||||||||||
Individually evaluated for impairment | 0 | 0 | 0 | 0 | |||||||||||
Collectively evaluated for impairment | 0 | 0 | 0 | 0 | |||||||||||
Unallocated [Member] | Receivables Acquired with Deteriorated Credit Quality [Member] | |||||||||||||||
Loans receivable: | |||||||||||||||
Amount of loans | $ 0 | $ 0 | $ 0 | $ 0 |
Allowance for Loan Losses and69
Allowance for Loan Losses and Credit Quality Disclosures - Impaired Loans Receivables (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
With no related allowance: | |||
Impaired loans with no related allowance, recorded investment | $ 3,288 | $ 3,030 | |
Impaired loans with no related allowance, unpaid principal balance | 3,584 | 3,201 | |
Impaired loans with no related allowance, average recorded investment | 4,293 | 3,417 | $ 5,036 |
Impaired loans with no related allowance, interest income recognized | 293 | 88 | 144 |
With an allowance: | |||
Impaired loans with an allowance, recorded investment | 8,417 | 4,127 | |
Impaired loans with an allowance, unpaid principal balance | 9,212 | 4,143 | |
Impaired loans, related allowance | 684 | 260 | |
Impaired loans with an allowance, average recorded investment | 6,030 | 4,092 | 4,882 |
Impaired loans with an allowance, interest income recognized | 272 | 28 | 159 |
Total: | |||
Impaired loans, recorded investment | 11,705 | 7,157 | |
Outstanding balance | 12,796 | 7,344 | |
Impaired loans, related allowance | 684 | 260 | |
Impaired loans, average recorded investment | 10,323 | 7,509 | 9,818 |
Impaired loans, interest income recognized | 565 | 116 | 303 |
Commercial Portfolio Segment [Member] | |||
With no related allowance: | |||
Impaired loans with no related allowance, recorded investment | 2,851 | 2,449 | |
Impaired loans with no related allowance, unpaid principal balance | 3,023 | 2,620 | |
Impaired loans with no related allowance, average recorded investment | 3,809 | 2,411 | 3,967 |
Impaired loans with no related allowance, interest income recognized | 293 | 88 | 144 |
With an allowance: | |||
Impaired loans with an allowance, recorded investment | 8,417 | 3,827 | |
Impaired loans with an allowance, unpaid principal balance | 9,212 | 3,827 | |
Impaired loans, related allowance | 684 | 222 | |
Impaired loans with an allowance, average recorded investment | 5,955 | 3,892 | 4,507 |
Impaired loans with an allowance, interest income recognized | 272 | 28 | 159 |
Total: | |||
Impaired loans, related allowance | 684 | 222 | |
Commercial Portfolio Segment [Member] | Construction Loans [Member] | |||
With no related allowance: | |||
Impaired loans with no related allowance, recorded investment | 232 | 186 | |
Impaired loans with no related allowance, unpaid principal balance | 232 | 186 | |
Impaired loans with no related allowance, average recorded investment | 209 | 260 | 477 |
Impaired loans with no related allowance, interest income recognized | 12 | 0 | 27 |
With an allowance: | |||
Impaired loans with an allowance, recorded investment | 0 | 205 | |
Impaired loans with an allowance, unpaid principal balance | 0 | 205 | |
Impaired loans, related allowance | 0 | 7 | |
Impaired loans with an allowance, average recorded investment | 86 | 51 | 0 |
Impaired loans with an allowance, interest income recognized | 0 | 9 | 0 |
Total: | |||
Impaired loans, recorded investment | 232 | 391 | |
Outstanding balance | 232 | 391 | |
Impaired loans, related allowance | 0 | 7 | |
Impaired loans, average recorded investment | 295 | 311 | 477 |
Impaired loans, interest income recognized | 12 | 9 | 27 |
Commercial Portfolio Segment [Member] | Commercial Business [Member] | |||
With no related allowance: | |||
Impaired loans with no related allowance, recorded investment | 1,271 | 883 | |
Impaired loans with no related allowance, unpaid principal balance | 1,419 | 1,054 | |
Impaired loans with no related allowance, average recorded investment | 828 | 623 | 492 |
Impaired loans with no related allowance, interest income recognized | 153 | 14 | 23 |
With an allowance: | |||
Impaired loans with an allowance, recorded investment | 3,462 | 255 | |
Impaired loans with an allowance, unpaid principal balance | 3,464 | 255 | |
Impaired loans, related allowance | 592 | 101 | |
Impaired loans with an allowance, average recorded investment | 2,864 | 238 | 307 |
Impaired loans with an allowance, interest income recognized | 84 | 0 | 5 |
Total: | |||
Impaired loans, recorded investment | 4,733 | 1,138 | |
Outstanding balance | 4,883 | 1,309 | |
Impaired loans, related allowance | 592 | 101 | |
Impaired loans, average recorded investment | 3,692 | 861 | 799 |
Impaired loans, interest income recognized | 237 | 14 | 28 |
Commercial Portfolio Segment [Member] | Commercial Real Estate [Member] | |||
With no related allowance: | |||
Impaired loans with no related allowance, recorded investment | 1,348 | 1,380 | |
Impaired loans with no related allowance, unpaid principal balance | 1,372 | 1,380 | |
Impaired loans with no related allowance, average recorded investment | 2,772 | 1,528 | 2,998 |
Impaired loans with no related allowance, interest income recognized | 128 | 74 | 94 |
With an allowance: | |||
Impaired loans with an allowance, recorded investment | 4,955 | 3,367 | |
Impaired loans with an allowance, unpaid principal balance | 5,748 | 3,367 | |
Impaired loans, related allowance | 92 | 114 | |
Impaired loans with an allowance, average recorded investment | 3,005 | 3,603 | 4,200 |
Impaired loans with an allowance, interest income recognized | 188 | 19 | 154 |
Total: | |||
Impaired loans, recorded investment | 6,303 | 4,747 | |
Outstanding balance | 7,120 | 4,747 | |
Impaired loans, related allowance | 92 | 114 | |
Impaired loans, average recorded investment | 5,777 | 5,131 | 7,198 |
Impaired loans, interest income recognized | 316 | 93 | 248 |
Commercial Portfolio Segment [Member] | Mortgage Warehouse Lines [Member] | |||
With no related allowance: | |||
Impaired loans with no related allowance, recorded investment | 0 | 0 | |
Impaired loans with no related allowance, unpaid principal balance | 0 | 0 | |
Impaired loans with no related allowance, average recorded investment | 0 | 0 | 0 |
Impaired loans with no related allowance, interest income recognized | 0 | 0 | 0 |
With an allowance: | |||
Impaired loans with an allowance, recorded investment | 0 | 0 | |
Impaired loans with an allowance, unpaid principal balance | 0 | 0 | |
Impaired loans, related allowance | 0 | 0 | |
Impaired loans with an allowance, average recorded investment | 0 | 0 | 0 |
Impaired loans with an allowance, interest income recognized | 0 | 0 | 0 |
Total: | |||
Impaired loans, recorded investment | 0 | 0 | |
Outstanding balance | 0 | 0 | |
Impaired loans, related allowance | 0 | 0 | |
Impaired loans, average recorded investment | 0 | 0 | 0 |
Impaired loans, interest income recognized | 0 | 0 | 0 |
Consumer Portfolio Segment [Member] | |||
With no related allowance: | |||
Impaired loans with no related allowance, recorded investment | 437 | 581 | |
Impaired loans with no related allowance, unpaid principal balance | 561 | 581 | |
Impaired loans with no related allowance, average recorded investment | 484 | 1,006 | 88 |
Impaired loans with no related allowance, interest income recognized | 0 | 0 | 0 |
With an allowance: | |||
Impaired loans with an allowance, recorded investment | 0 | 300 | |
Impaired loans with an allowance, unpaid principal balance | 0 | 316 | |
Impaired loans, related allowance | 0 | 38 | |
Impaired loans with an allowance, average recorded investment | 75 | 200 | 275 |
Impaired loans with an allowance, interest income recognized | 0 | 0 | 0 |
Total: | |||
Impaired loans, related allowance | 0 | 38 | |
Consumer Portfolio Segment [Member] | Residential Real Estate Loans [Member] | |||
With no related allowance: | |||
Impaired loans with no related allowance, recorded investment | 69 | 244 | |
Impaired loans with no related allowance, unpaid principal balance | 123 | 244 | |
Impaired loans with no related allowance, average recorded investment | 142 | 725 | 981 |
Impaired loans with no related allowance, interest income recognized | 0 | 0 | 0 |
With an allowance: | |||
Impaired loans with an allowance, recorded investment | 0 | 300 | |
Impaired loans with an allowance, unpaid principal balance | 0 | 316 | |
Impaired loans, related allowance | 0 | 38 | |
Impaired loans with an allowance, average recorded investment | 75 | 200 | 100 |
Impaired loans with an allowance, interest income recognized | 0 | 0 | 0 |
Total: | |||
Impaired loans, recorded investment | 69 | 544 | |
Outstanding balance | 123 | ||
Impaired loans, related allowance | 0 | 38 | |
Impaired loans, average recorded investment | 217 | 1,081 | |
Impaired loans, interest income recognized | 0 | 0 | |
Consumer Portfolio Segment [Member] | Loans to Individuals [Member] | |||
With no related allowance: | |||
Impaired loans with no related allowance, recorded investment | 368 | 337 | |
Impaired loans with no related allowance, unpaid principal balance | 438 | 337 | |
Impaired loans with no related allowance, average recorded investment | 342 | 281 | 88 |
Impaired loans with no related allowance, interest income recognized | 0 | 0 | 0 |
With an allowance: | |||
Impaired loans with an allowance, recorded investment | 0 | 0 | |
Impaired loans with an allowance, unpaid principal balance | 0 | 0 | |
Impaired loans, related allowance | 0 | 0 | |
Impaired loans with an allowance, average recorded investment | 0 | 0 | 175 |
Impaired loans with an allowance, interest income recognized | 0 | 0 | 0 |
Total: | |||
Impaired loans, recorded investment | 368 | 337 | |
Outstanding balance | 438 | ||
Impaired loans, related allowance | 0 | 0 | |
Impaired loans, average recorded investment | 342 | 263 | |
Impaired loans, interest income recognized | 0 | 0 | |
Consumer Portfolio Segment [Member] | Other [Member] | |||
With no related allowance: | |||
Impaired loans with no related allowance, recorded investment | 0 | 0 | |
Impaired loans with no related allowance, unpaid principal balance | 0 | 0 | |
Impaired loans with no related allowance, average recorded investment | 0 | 0 | 0 |
Impaired loans with no related allowance, interest income recognized | 0 | 0 | 0 |
With an allowance: | |||
Impaired loans with an allowance, recorded investment | 0 | 0 | |
Impaired loans with an allowance, unpaid principal balance | 0 | 0 | |
Impaired loans, related allowance | 0 | 0 | |
Impaired loans with an allowance, average recorded investment | 0 | 0 | 0 |
Impaired loans with an allowance, interest income recognized | 0 | 0 | 0 |
Total: | |||
Impaired loans, recorded investment | 0 | 0 | |
Outstanding balance | 0 | 0 | |
Impaired loans, related allowance | 0 | 0 | |
Impaired loans, average recorded investment | 0 | 0 | 0 |
Impaired loans, interest income recognized | $ 0 | $ 0 | $ 0 |
Allowance for Loan Losses and70
Allowance for Loan Losses and Credit Quality Disclosures - Acquired Credit Impaired Loans (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Financing Receivable, Impaired [Line Items] | ||
Outstanding balance | $ 12,796 | $ 7,344 |
Receivables Acquired with Deteriorated Credit Quality [Member] | ||
Financing Receivable, Impaired [Line Items] | ||
Outstanding balance | 998 | 1,470 |
Carrying amount | $ 860 | $ 1,121 |
Allowance for Loan Losses and71
Allowance for Loan Losses and Credit Quality Disclosures - Changes in Accretable Discount for Acquired Credit Impaired Loans (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Certain Loans Acquired in Transfer Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward] | |||
Balance at beginning of year | $ 30 | $ 73 | $ 135 |
Transfer from non-accretable to accretable | 161 | 0 | 0 |
Accretion of discount | (65) | (43) | (62) |
Balance at end of year | 126 | 30 | 73 |
Non-accretable difference at end of year | $ 26 | $ 215 | $ 215 |
Allowance for Loan Losses and72
Allowance for Loan Losses and Credit Quality Disclosures - Estimate of the Remaining Accretable Discount (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Receivables [Abstract] | ||||
2,018 | $ 82 | |||
2,019 | 44 | |||
Thereafter | 0 | |||
Total | $ 126 | $ 30 | $ 73 | $ 135 |
Allowance for Loan Losses and73
Allowance for Loan Losses and Credit Quality Disclosures - Consumer Mortgage Loans Secured by Residential Real Estate in Process of Foreclosure (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017USD ($)loan | Dec. 31, 2016USD ($)loan | |
Receivables [Abstract] | ||
Number of loans | loan | 1 | 3 |
Recorded Investment | $ | $ 77 | $ 524 |
Allowance for Loan Losses and74
Allowance for Loan Losses and Credit Quality Disclosures - Troubled Debt Restructurings (Details) - Commercial Portfolio Segment [Member] $ in Thousands | 12 Months Ended | |
Dec. 31, 2017USD ($)contract | Dec. 31, 2016USD ($)contract | |
Financing Receivable, Modifications [Line Items] | ||
Number of Contracts | contract | 1 | 1 |
Pre-Modification Outstanding Recorded Investment | $ 2,337 | $ 458 |
Post-Modification Outstanding Recorded Investment | $ 2,322 | $ 458 |
Related Parties (Details)
Related Parties (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Loans and Leases Receivable, Related Parties [Roll Forward] | |||
Balance, beginning of year | $ 1,357 | $ 870 | $ 1,376 |
Loans granted | 1,603 | 751 | 16 |
Repayments of loans | (241) | (264) | (522) |
Balance, end of year | 2,719 | 1,357 | $ 870 |
Related party deposits | 10,700 | $ 14,900 | |
Payments for rent | $ 122 |
Premises and Equipment - Summar
Premises and Equipment - Summary of Premises and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment [Line Items] | ||
Premises and equipment | $ 21,491 | $ 20,642 |
Less: Accumulated depreciation | (10,786) | (9,969) |
Premises and Equipment, Net | 10,705 | 10,673 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment | $ 1,798 | 1,798 |
Building [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 40 years | |
Premises and equipment | $ 8,083 | 8,083 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment | $ 6,241 | 5,864 |
Leasehold Improvements [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 3 years | |
Leasehold Improvements [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 10 years | |
Furniture, Fixtures and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment | $ 5,032 | 4,794 |
Furniture, Fixtures and Equipment [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 3 years | |
Furniture, Fixtures and Equipment [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 15 years | |
Projects in Progress [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment | $ 337 | $ 103 |
Premises and Equipment - Narrat
Premises and Equipment - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation expense | $ 814 | $ 893 | $ 1,000 |
Other Real Estate Owned ("ORE78
Other Real Estate Owned ("OREO") - Activity Related to Other Real Estate Owned (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Real Estate Owned [Roll Forward] | |||
Balance, beginning of year | $ 166 | $ 966 | $ 5,710 |
OREO properties added | 455 | 141 | 2,357 |
Sales during the year | (626) | (1,002) | (6,719) |
Increase (decrease) in carrying amount of real estate owned | 5 | 61 | (382) |
Balance, end of year | $ 0 | $ 166 | $ 966 |
Other Real Estate Owned ("ORE79
Other Real Estate Owned ("OREO") - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Real Estate [Abstract] | |||
Gain (loss) on other real estate owned | $ 5 | $ 31 | $ (692) |
Goodwill and Intangible Asset80
Goodwill and Intangible Assets - Schedule of Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Goodwill | $ 11,854 | $ 11,854 |
Core deposits intangible | 642 | 1,026 |
Total | $ 12,496 | $ 12,880 |
Goodwill and Intangible Asset81
Goodwill and Intangible Assets - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization of intangible assets | $ 384 | $ 404 | $ 428 |
Goodwill and Intangible Asset82
Goodwill and Intangible Assets - Scheduled Amortization (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2,018 | $ 305 | |
2,019 | 110 | |
2,020 | 88 | |
2,021 | 67 | |
2,022 | 45 | |
After five years | 27 | |
Core deposits intangible | $ 642 | $ 1,026 |
Deposits - Schedule of Deposits
Deposits - Schedule of Deposits (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Deposits, by Type | ||
Non-interest bearing | $ 196,509 | $ 170,854 |
Interest bearing | 372,133 | 310,103 |
Savings | 215,197 | 205,294 |
Certificates of deposit | 138,167 | 148,265 |
Total deposits | $ 922,006 | $ 834,516 |
Percentage of Deposits | ||
Percentage of deposits, non-interest bearing | 21.31% | 20.47% |
Percentage of deposits, interest bearing | 40.36% | 37.16% |
Percentage of deposits, savings | 23.34% | 24.60% |
Percentage of deposits, certificates of deposits | 14.99% | 17.77% |
Percentage of deposits | 100.00% | 100.00% |
Deposits - Maturities of Time D
Deposits - Maturities of Time Deposits (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Banking and Thrift [Abstract] | ||
2,018 | $ 76,293 | |
2,019 | 33,238 | |
2,020 | 9,418 | |
2,021 | 12,107 | |
2,022 | 7,111 | |
Time Deposits | $ 138,167 | $ 148,265 |
Deposits - Narrative (Details)
Deposits - Narrative (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Banking and Thrift [Abstract] | ||
Certificates of deposit greater than $100,000 | $ 23.6 | $ 23.9 |
Borrowings (Details)
Borrowings (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Federal Home Loan Bank, Advances [Line Items] | ||
Overnight Borrowings | $ 20,500 | $ 63,050 |
Federal Home Loan Bank, Advances, Convertible Option [Member] | ||
Federal Home Loan Bank, Advances [Line Items] | ||
Amount of fixed rate convertible advance | $ 10,000 | |
Interest rate percentage | 4.08% | |
Overnight Funds [Member] | ||
Federal Home Loan Bank, Advances [Line Items] | ||
Overnight Borrowings | $ 20,500 | $ 63,100 |
Average interest rates | 1.53% | 0.74% |
Federal Home Loan Bank [Member] | ||
Federal Home Loan Bank, Advances [Line Items] | ||
Balance of borrowings | $ 140,300 | |
Correspondent Banks [Member] | ||
Federal Home Loan Bank, Advances [Line Items] | ||
Balance of borrowings | $ 46,000 |
Redeemable Subordinated Deben87
Redeemable Subordinated Debentures (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017USD ($)financial_institution | May 30, 2006USD ($) | |
Subordinated Borrowing [Line Items] | ||
Amount of trust preferred securities | $ 18,000 | |
Amount invested in Trust II | $ 557 | |
Amount of floating rate junior subordinated debentures | $ 18,557 | |
Interest rate at period end | 3.3447% | |
Number of financial institution holding companies | financial_institution | 50 | |
London Interbank Offered Rate (LIBOR) [Member] | ||
Subordinated Borrowing [Line Items] | ||
Basis point spread on floating interest rate | 1.65% |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Federal: | |||||||||||||||
Current | $ 2,791 | $ 3,360 | $ 3,199 | ||||||||||||
Deferred | 496 | 269 | 8 | ||||||||||||
Provisional re-measurement of deferred tax assets and liabilities | 1,712 | 0 | 0 | ||||||||||||
Federal income tax expense (benefit) | 4,999 | 3,629 | 3,207 | ||||||||||||
State: | |||||||||||||||
Current | 748 | 909 | 704 | ||||||||||||
Deferred | 124 | 85 | 151 | ||||||||||||
State income tax expense (benefit) | 872 | 994 | 855 | ||||||||||||
Income tax expense (benefit) | $ 2,951 | $ 1,227 | $ 841 | $ 852 | $ 1,006 | $ 1,456 | $ 1,113 | $ 1,048 | $ 747 | $ 1,148 | $ 1,112 | $ 1,055 | $ 5,871 | $ 4,623 | $ 4,062 |
Income Taxes - Income Tax Rate
Income Taxes - Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||||||||||||||
Federal income tax | $ 4,352 | $ 4,729 | $ 4,327 | ||||||||||||
Add (deduct) effect of: | |||||||||||||||
State income taxes net of federal income tax effect | 575 | 656 | 564 | ||||||||||||
Tax-exempt interest income | (728) | (706) | (724) | ||||||||||||
Bank-owned life insurance | (177) | (187) | (203) | ||||||||||||
Executive compensation | 139 | 0 | 0 | ||||||||||||
Provisional remeasurement of federal deferred tax assets and liabilities | 1,712 | 0 | 0 | ||||||||||||
Other items, net | (2) | 131 | 98 | ||||||||||||
Income tax expense (benefit) | $ 2,951 | $ 1,227 | $ 841 | $ 852 | $ 1,006 | $ 1,456 | $ 1,113 | $ 1,048 | $ 747 | $ 1,148 | $ 1,112 | $ 1,055 | $ 5,871 | $ 4,623 | $ 4,062 |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Deferred tax assets: | ||
Allowance for loan losses | $ 2,253 | $ 2,993 |
Unrealized loss on securities available for sale | 137 | 130 |
Supplemental executive retirement plan liability | 1,213 | 1,886 |
Other than temporary impairment loss | 119 | 170 |
Depreciation | 622 | 802 |
Non-accrual interest | 330 | 313 |
Other | 147 | 262 |
Total gross deferred tax assets | 4,821 | 6,556 |
Deferred tax liabilities: | ||
Deferred costs | 540 | 0 |
Pension liability | 31 | 44 |
Acquisition accounting adjustments | 44 | 52 |
Total gross deferred tax liabilities | 615 | 96 |
Net deferred tax assets | $ 4,206 | $ 6,460 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Income Tax Disclosure [Abstract] | |
Change in tax rate, provisional income tax expense (benefit) | $ 1.7 |
Comprehensive Income and Accu92
Comprehensive Income and Accumulated Other Comprehensive Loss - Components of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
AOCI Attributable to Parent [Abstract] | ||
Other comprehensive income (loss), before tax | $ (961) | $ (856) |
Other comprehensive income (loss), tax | 225 | 256 |
Other comprehensive income (loss), net of tax | (736) | (600) |
Net unrealized holding loss on securities available for sale [Member] | ||
AOCI Attributable to Parent [Abstract] | ||
Other comprehensive income (loss), before tax | (571) | (464) |
Other comprehensive income (loss), tax | 137 | 130 |
Other comprehensive income (loss), net of tax | (434) | (334) |
Unrealized impairment (loss) on held to maturity security [Member] | ||
AOCI Attributable to Parent [Abstract] | ||
Other comprehensive income (loss), before tax | (501) | (501) |
Other comprehensive income (loss), tax | 119 | 170 |
Other comprehensive income (loss), net of tax | (382) | (331) |
Unfunded pension liability [Member] | ||
AOCI Attributable to Parent [Abstract] | ||
Other comprehensive income (loss), before tax | 111 | 109 |
Other comprehensive income (loss), tax | (31) | (44) |
Other comprehensive income (loss), net of tax | $ 80 | $ 65 |
Comprehensive Income and Accu93
Comprehensive Income and Accumulated Other Comprehensive Loss - Changes in the Components of AOCI (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Balance, beginning of period | $ 104,801,000 | $ 95,960,000 | $ 87,110,000 |
Reclassification of certain deferred tax effects | (109,000) | ||
Total other comprehensive (loss) income | (27,000) | (470,000) | (378,000) |
Balance, end of period | 111,653,000 | 104,801,000 | 95,960,000 |
Accumulated Other Comprehensive Income (Loss) [Member] | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Balance, beginning of period | (600,000) | (130,000) | 248,000 |
Other comprehensive income (loss) before reclassifications | 64,000 | (372,000) | (218,000) |
Amounts reclassified from accumulated other comprehensive income (loss) | (91,000) | (98,000) | (160,000) |
Reclassification of certain deferred tax effects | (109,000) | ||
Total other comprehensive (loss) income | (27,000) | (470,000) | (378,000) |
Other comprehensive loss | (136,000) | ||
Balance, end of period | (736,000) | (600,000) | (130,000) |
Unrealized Holding (Losses) Gains on Available for Sale Securities [Member] | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Balance, beginning of period | (334,000) | 90,000 | 276,000 |
Other comprehensive income (loss) before reclassifications | 26,000 | (424,000) | (186,000) |
Amounts reclassified from accumulated other comprehensive income (loss) | (55,000) | 0 | 0 |
Reclassification of certain deferred tax effects | (71,000) | ||
Total other comprehensive (loss) income | (424,000) | (186,000) | |
Other comprehensive loss | (100,000) | ||
Balance, end of period | (434,000) | (334,000) | 90,000 |
Unrealized Impairment Loss On Held to Maturity Security [Member] | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Balance, beginning of period | (331,000) | (331,000) | (331,000) |
Other comprehensive income (loss) before reclassifications | 0 | 0 | 0 |
Amounts reclassified from accumulated other comprehensive income (loss) | 0 | 0 | 0 |
Reclassification of certain deferred tax effects | (51,000) | ||
Total other comprehensive (loss) income | 0 | 0 | |
Other comprehensive loss | (51,000) | ||
Balance, end of period | (382,000) | (331,000) | (331,000) |
Unfunded Pension Liability [Member] | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Balance, beginning of period | 65,000 | 111,000 | 303,000 |
Other comprehensive income (loss) before reclassifications | 38,000 | 52,000 | (32,000) |
Amounts reclassified from accumulated other comprehensive income (loss) | (36,000) | (98,000) | (160,000) |
Reclassification of certain deferred tax effects | 13,000 | ||
Total other comprehensive (loss) income | (46,000) | (192,000) | |
Other comprehensive loss | 15,000 | ||
Balance, end of period | $ 80,000 | $ 65,000 | $ 111,000 |
Benefit Plans - Narrative (Deta
Benefit Plans - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Matching contribution percentage | 50.00% | ||
Maximum contribution as a percentage of base compensation | 6.00% | ||
Employer contributions | $ 353 | $ 272 | $ 274 |
Cash surrender value of policies | 25,100 | 22,200 | |
Net recognized pension liability | 4,205 | 4,613 | 4,971 |
Compensation expense | 293 | $ 235 | $ 184 |
Net periodic benefit cost projected to be recognized in net periodic benefit expense during 2018 | 193 | ||
Actuarial gains to be recognized as a component of net periodic benefit expense | $ 111 | ||
Discount rate | 4.00% | 4.00% | 4.00% |
Salary scale | 4.00% | 4.00% | 4.00% |
Minimum [Member] | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Service period | 6 months |
Benefit Plans - Changes in Bene
Benefit Plans - Changes in Benefit Obligations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | |
Change in Benefit Obligation | |||||
Beginning January 1 | $ 4,613 | $ 4,971 | |||
Service cost | 197 | 216 | $ 267 | ||
Interest cost | 156 | 179 | 183 | ||
Actuarial gain | 62 | 83 | |||
Benefits paid | (699) | (670) | |||
Ending December 31 | 4,205 | 4,613 | 4,971 | ||
Amount Recognized in Consolidated Balance Sheets | |||||
Liability for pension | $ 4,316 | $ 4,722 | |||
Net actuarial gain included in accumulated other comprehensive income | 111 | 109 | |||
Net recognized pension liability | 4,613 | 4,971 | 4,971 | 4,205 | 4,613 |
Information for pension plans with an accumulated benefit obligation in excess of plan assets | |||||
Projected benefit obligation | $ 4,613 | $ 4,971 | $ 4,971 | 4,205 | 4,613 |
Accumulated benefit obligation | $ 4,043 | $ 4,463 |
Benefit Plans - Net Periodic Be
Benefit Plans - Net Periodic Benefit Cost (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Retirement Benefits [Abstract] | |||
Service cost | $ 197 | $ 216 | $ 267 |
Interest cost | 156 | 179 | 183 |
Recognized net actuarial gain | (60) | (160) | (266) |
Net periodic benefit cost | $ 293 | $ 235 | $ 184 |
Benefit Plans - Expected Benefi
Benefit Plans - Expected Benefit Payments (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Retirement Benefits [Abstract] | |
2,018 | $ 4,509 |
2,019 | 0 |
2,020 | 0 |
2,021 | 0 |
2,022 | 0 |
Thereafter | 0 |
Total | $ 4,509 |
Share-Based Compensation - Narr
Share-Based Compensation - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Nov. 06, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares authorized for grant | 485,873 | |||
Shares of common stock available for future grants | 127,736 | |||
Stock based compensation expense | $ 65 | $ 44 | $ 41 | |
Unrecognized compensation cost related to non-vested stock-option based compensation arrangements | $ 59 | |||
Share price (in Dollars per share) | $ 18.30 | $ 19.25 | ||
Aggregate intrinsic value of stock options exercised | $ 304 | |||
Exercise of stock options | $ 262 | |||
Employee Stock Option [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Period that cost is expected to be recognized | 4 years | |||
Employee Stock Option [Member] | Maximum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Term of stock options | 10 years | |||
Restricted Stock [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock based compensation expense | $ 934 | $ 710 | $ 590 | |
Period that cost is expected to be recognized | 3 years | |||
Vesting period | 4 years | |||
Unrecognized compensation cost | $ 1,500 |
Share-Based Compensation - Shar
Share-Based Compensation - Share-based Compensation Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Outstanding (in Shares) | 165,819 | |
Granted (in Shares) | 9,900 | |
Exercised (in Shares) | (31,640) | |
Forfeited (in Shares) | (1,030) | |
Expired (in Shares) | (1,044) | |
Outstanding (in Shares) | 142,005 | 165,819 |
Number of shares, exercisable at December 31, 2017 | 124,141 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||
Outstanding, weighted average exercise price (in Dollars per share) | $ 7.35 | |
Granted, weighted average exercise price (in Dollars per share) | 18.65 | |
Exercised, weighted average exercise price (in Dollars per share) | 8.05 | |
Forfeited, weighted average exercise price (in Dollars per share) | 14.57 | |
Expired, weighted average exercise price (in Dollars per share) | 14.86 | |
Outstanding, weighted average exercise price (in Dollars per share) | 7.86 | $ 7.35 |
Weighted average exercise price, exercisable at December 31, 2017 (in Dollars per share) | $ 6.96 | |
Outstanding, weighted average remaining contractual term | 4 years 4 months 24 days | 5 years 2 months 12 days |
Weighted average remaining contractual term (years), exercisable at December 31, 2017 | 3 years 10 months 24 days | |
Outstanding, aggregate intrinsic value | $ 1,486 | $ 1,882 |
Aggregate intrinsic value, exercisable at December 31, 2017 | $ 1,408 |
Share-Based Compensation - Stoc
Share-Based Compensation - Stock Options Outstanding and Exercisable (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Outstanding options (in Shares) | 142,005 | 165,819 |
Outstanding options, average life in years | 4 years 4 months 24 days | 5 years 2 months 12 days |
Outstanding options, average exercise price (in Dollars per share) | $ 7.86 | $ 7.35 |
Exercisable options (in Shares) | 124,141 | |
Exercisable options, average life in years | 3 years 10 months 24 days | |
Exercisable options, average exercise price (in Dollars per share) | $ 6.96 | |
$5.54 to $5.63 [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Exercise price range, lower limit (in Dollars per share) | 5.54 | |
Exercise price range, upper limit (in Dollars per share) | $ 5.63 | |
Outstanding options (in Shares) | 50,975 | |
Outstanding options, average life in years | 3 years 9 months 18 days | |
Outstanding options, average exercise price (in Dollars per share) | $ 5.60 | |
Exercisable options (in Shares) | 50,975 | |
Exercisable options, average life in years | 3 years 9 months 18 days | |
Exercisable options, average exercise price (in Dollars per share) | $ 5.60 | |
$6.16 to $7.46 [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Exercise price range, lower limit (in Dollars per share) | 6.16 | |
Exercise price range, upper limit (in Dollars per share) | $ 7.46 | |
Outstanding options (in Shares) | 57,688 | |
Outstanding options, average life in years | 3 years 1 month 6 days | |
Outstanding options, average exercise price (in Dollars per share) | $ 6.98 | |
Exercisable options (in Shares) | 57,688 | |
Exercisable options, average life in years | 3 years 1 month 6 days | |
Exercisable options, average exercise price (in Dollars per share) | $ 6.98 | |
$9.30 to $11.98 [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Exercise price range, lower limit (in Dollars per share) | 9.30 | |
Exercise price range, upper limit (in Dollars per share) | $ 11.98 | |
Outstanding options (in Shares) | 24,442 | |
Outstanding options, average life in years | 7 years 1 month 6 days | |
Outstanding options, average exercise price (in Dollars per share) | $ 10.70 | |
Exercisable options (in Shares) | 13,698 | |
Exercisable options, average life in years | 6 years 9 months 18 days | |
Exercisable options, average exercise price (in Dollars per share) | $ 10.43 | |
$18.65 [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Exercise price range, lower limit (in Dollars per share) | 18.65 | |
Exercise price range, upper limit (in Dollars per share) | $ 18.65 | |
Outstanding options (in Shares) | 8,900 | |
Outstanding options, average life in years | 9 years | |
Outstanding options, average exercise price (in Dollars per share) | $ 18.65 | |
Exercisable options (in Shares) | 1,780 | |
Exercisable options, average life in years | 9 years | |
Exercisable options, average exercise price (in Dollars per share) | $ 18.65 |
Share-Based Compensation - Sign
Share-Based Compensation - Significant Weighted Average Assumptions Used to Calculate Fair Value of Options Granted (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Fair value of options granted (in Dollars per share) | $ 6.05 | $ 4.65 | $ 4.05 |
Risk-free rate of return (percentage) | 2.45% | 2.25% | 1.37% |
Expected option life in years | 7 years | 7 years | 7 years |
Expected volatility (percentage) | 31.25% | 30.66% | 32.37% |
Expected dividends (percentage) | 1.19% | 0.00% | 0.00% |
Share-Based Compensation - Rest
Share-Based Compensation - Restricted Stock Activity (Details) - Restricted Stock [Member] | 12 Months Ended |
Dec. 31, 2017$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Non-vested (in Shares) | shares | 146,639 |
Granted (in Shares) | shares | 61,900 |
Vested (in Shares) | shares | (56,507) |
Forfeited (in Shares) | shares | (1,287) |
Non-vested (in Shares) | shares | 150,745 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |
Non-vested, average grant-date fair value (in Dollars per share) | $ / shares | $ 9.02 |
Granted, average grant-date fair value (in Dollars per share) | $ / shares | 17.96 |
Vested, average grant-date fair value (in Dollars per share) | $ / shares | 10.60 |
Forfeited, average grant-date fair value (in Dollars per share) | $ / shares | 12.49 |
Non-vested, average grant-date fair value (in Dollars per share) | $ / shares | $ 11.87 |
Commitments and Contingencies -
Commitments and Contingencies - Future Minimum Rental Payments for Operating Leases (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,018 | $ 1,281 |
2,019 | 1,115 |
2,020 | 910 |
2,021 | 821 |
2,022 | 710 |
Thereafter | 2,675 |
Future minimum rental payments under non-cancelable operating leases | $ 7,512 |
Commitments and Contingencie104
Commitments and Contingencies - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Rent expense | $ 1,500 | $ 1,500 | $ 1,500 |
Supply Commitment [Line Items] | |||
Aggregate amount of standby letters of credit | 1,200 | 2,000 | |
Loans that have not closed commitments [Member] | |||
Supply Commitment [Line Items] | |||
Amount committed to advance to borrowers | 57,500 | 42,600 | |
Lone of credit commitments [Member] | |||
Supply Commitment [Line Items] | |||
Amount committed to advance to borrowers | 387,600 | 330,100 | |
Forward sales commitments [Member] | |||
Derivative [Line Items] | |||
Notional amount of forward sales commitments | 7,900 | 8,300 | |
Fair value of forward sales commitments and the related loan origination commitments | $ 135 | $ 123 |
Other Operating Expenses (Detai
Other Operating Expenses (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Other Income and Expenses [Abstract] | |||
Regulatory, professional and other consulting fees | $ 2,263 | $ 1,706 | $ 1,681 |
Equipment | 1,008 | 917 | 939 |
Telephone | 389 | 377 | 449 |
Amortization of intangible assets | 384 | 404 | 428 |
Insurance | 373 | 303 | 324 |
Merger-related expenses | 265 | 0 | 0 |
Supplies | 259 | 219 | 248 |
Marketing | 225 | 240 | 282 |
Other expenses | 2,151 | 1,535 | 1,540 |
Other operating expenses | $ 7,317 | $ 5,701 | $ 5,891 |
Regulatory Capital Requireme106
Regulatory Capital Requirements (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | ||
Common equity Tier 1, actual amount (in Dollars) | $ 99,839 | $ 93,101 |
Common equity Tier 1, actual ratio | 10.19% | 10.40% |
Common equity Tier 1, amount for capital adequacy purposes (in Dollars) | $ 44,106 | $ 40,302 |
Common equity Tier 1, ratio for capital adequacy purposes | 4.50% | 4.50% |
Total Capital to Risk Weighted Assets, actual amount (in Dollars) | $ 125,852 | $ 118,595 |
Total Capital to Risk Weighted Assets, actual ratio | 12.84% | 13.24% |
Total Capital to Risk Weighted Assets, amount for capital adequacy purposes (in Dollars) | $ 78,411 | $ 71,648 |
Total Capital to Risk Weighted Assets, ratio for capital adequacy purposes | 8.00% | 8.00% |
Tier I Capital to Risk Weighted Assets, actual amount (in Dollars) | $ 117,839 | $ 111,101 |
Tier I Capital to Risk Weighted Assets, actual ratio | 12.02% | 12.41% |
Tier I Capital to Risk Weighted Assets, amount for capital adequacy purposes (in Dollars) | $ 58,808 | $ 53,736 |
Tier I Capital to Risk Weighted Assets, ratio for capital adequacy purposes | 6.00% | 6.00% |
Tier I Leverage Capital, actual amount (in Dollars) | $ 117,839 | $ 111,101 |
Tier I Leverage Capital, actual ratio | 11.23% | 10.93% |
Tier I Leverage Capital, amount for capital adequacy purposes (in Dollars) | $ 41,987 | $ 40,658 |
Tier I Leverage Capital, ratio for capital adequacy purposes | 4.00% | 4.00% |
Bank [Member] | ||
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | ||
Common equity Tier 1, actual amount (in Dollars) | $ 115,031 | $ 108,606 |
Common equity Tier 1, actual ratio | 11.74% | 12.13% |
Common equity Tier 1, amount for capital adequacy purposes (in Dollars) | $ 44,106 | $ 40,302 |
Common equity Tier 1, ratio for capital adequacy purposes | 4.50% | 4.50% |
Common equity Tier 1, amount to be well capitalized under prompt corrective action provisions (in Dollars) | $ 63,709 | $ 58,214 |
Common equity Tier 1, ratio to be well capitalized under prompt corrective action provisions | 6.50% | 6.50% |
Total Capital to Risk Weighted Assets, actual amount (in Dollars) | $ 123,044 | $ 116,100 |
Total Capital to Risk Weighted Assets, actual ratio | 12.55% | 12.96% |
Total Capital to Risk Weighted Assets, amount for capital adequacy purposes (in Dollars) | $ 78,411 | $ 71,648 |
Total Capital to Risk Weighted Assets, ratio for capital adequacy purposes | 8.00% | 8.00% |
Total Capital to Risk Weighted Assets, amount to be well capitalized under prompt corrective action provisions (in Dollars) | $ 98,014 | $ 89,560 |
Total Capital to Risk Weighted Assets, ratio to be well capitalized under prompt corrective action provisions | 10.00% | 10.00% |
Tier I Capital to Risk Weighted Assets, actual amount (in Dollars) | $ 115,031 | $ 108,606 |
Tier I Capital to Risk Weighted Assets, actual ratio | 11.74% | 12.13% |
Tier I Capital to Risk Weighted Assets, amount for capital adequacy purposes (in Dollars) | $ 58,808 | $ 53,736 |
Tier I Capital to Risk Weighted Assets, ratio for capital adequacy purposes | 6.00% | 6.00% |
Tier I Capital to Risk Weighted Assets, amount to be well capitalized under prompt corrective action provisions (in Dollars) | $ 78,411 | $ 71,648 |
Tier I Capital to Risk Weighted Assets, ratio to be well capitalized under prompt corrective action provisions | 8.00% | 8.00% |
Tier I Leverage Capital, actual amount (in Dollars) | $ 115,031 | $ 108,606 |
Tier I Leverage Capital, actual ratio | 10.96% | 10.68% |
Tier I Leverage Capital, amount for capital adequacy purposes (in Dollars) | $ 41,987 | $ 40,658 |
Tier I Leverage Capital, ratio for capital adequacy purposes | 4.00% | 4.00% |
Tier I Leverage Capital, amount to be well capitalized under prompt corrective action provisions (in Dollars) | $ 52,484 | $ 50,823 |
Tier I Leverage Capital, ratio to be well capitalized under prompt corrective action provisions | 5.00% | 5.00% |
Shareholders' Equity (Details)
Shareholders' Equity (Details) - USD ($) $ / shares in Units, $ in Thousands | Jan. 21, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2017 |
Stockholders' Equity Note [Abstract] | ||||
Number or new warrants | 2 | |||
Shares of stock of the company permitted to acquire upon exchange of warrants | 286,174 | |||
Price of common stock upon exchange of warrants (in Dollars per share) | $ 6.291 | |||
Percentage of common shares outstanding authorized to be repurchased | 5.00% | |||
Number of shares repurchased | 2,000 | 31,050 | 0 | |
Cost to repurchase shares | $ 24 | $ 359 |
Fair Value Disclosures - Financ
Fair Value Disclosures - Financial Assets and Liabilities at Fair Value Measured on Recurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | $ 105,458 | $ 103,794 |
Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 16,080 | 12,826 |
Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 89,378 | 90,968 |
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
US Treasury securities and obligations of US Government sponsored corporations (GSE) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 1,967 | 3,479 |
US Treasury securities and obligations of US Government sponsored corporations (GSE) [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
US Treasury securities and obligations of US Government sponsored corporations (GSE) [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 1,967 | 3,479 |
US Treasury securities and obligations of US Government sponsored corporations (GSE) [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Residential collateralized mortgage obligations- GSE [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 27,325 | 22,560 |
Residential collateralized mortgage obligations- GSE [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Residential collateralized mortgage obligations- GSE [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 27,325 | 22,560 |
Residential collateralized mortgage obligations- GSE [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Residential mortgage backed securities - GSE [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 14,288 | 31,476 |
Residential mortgage backed securities - GSE [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Residential mortgage backed securities - GSE [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 14,288 | 31,476 |
Residential mortgage backed securities - GSE [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Obligations of state and political subdivisions [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 19,720 | 21,400 |
Obligations of state and political subdivisions [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Obligations of state and political subdivisions [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 19,720 | 21,400 |
Obligations of state and political subdivisions [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Trust preferred debt securities - single issuer [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 2,349 | 2,272 |
Trust preferred debt securities - single issuer [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Trust preferred debt securities - single issuer [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 2,349 | 2,272 |
Trust preferred debt securities - single issuer [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Corporate debt securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 27,683 | 21,768 |
Corporate debt securities [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 16,080 | 12,826 |
Corporate debt securities [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 11,603 | 8,942 |
Corporate debt securities [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Other debt securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 12,126 | 839 |
Other debt securities [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Other debt securities [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 12,126 | 839 |
Other debt securities [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | $ 0 | $ 0 |
Fair Value Disclosures - Fin109
Fair Value Disclosures - Financial Assets and Liabilities at Fair Value Measured on Non-recurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | $ 8,313 | $ 4,130 |
Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | $ 8,313 | $ 4,130 |
Fair Value Disclosures - Narrat
Fair Value Disclosures - Narrative (Details) $ in Thousands | Dec. 31, 2017USD ($)loan | Dec. 31, 2016USD ($)loan |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, aggregate balance | $ 11,705 | $ 7,157 |
Impaired loans, related allowance | $ 684 | $ 260 |
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Number of impaired loans | loan | 14 | 9 |
Impaired loans, aggregate balance | $ 9,000 | $ 4,400 |
Impaired loans, related allowance | $ 684 | $ 260 |
Fair Value Disclosures - Fair V
Fair Value Disclosures - Fair Value Qualitative Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Impaired loans (in Dollars) | $ 8,313 | $ 4,130 |
Impaired Loans [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Impaired loans (in Dollars) | $ 8,313 | $ 4,130 |
Valuation Techniques | Appraisal of collateral (1) | Appraisal of collateral (1) |
Unobservable Input | Appraisal adjustments (2) | Appraisal adjustments (2) |
Impaired Loans [Member] | Minimum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Range (percentage) | 0.50% | 3.00% |
Impaired Loans [Member] | Maximum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Range (percentage) | 100.00% | 100.00% |
Impaired Loans [Member] | Weighted Average [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Range (percentage) | 28.20% | 29.10% |
Fair Value Disclosures - Estima
Fair Value Disclosures - Estimated Fair Value of Financial Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | $ 18,754 | $ 14,886 |
Securities available for sale | 105,458 | 103,794 |
Securities held to maturity | 110,267 | 126,810 |
Securities held to maturity, fair value | 111,865 | 128,559 |
Loans held for sale | 4,254 | 14,829 |
Loans | 781,893 | 717,314 |
Accrued interest receivable | 3,478 | 3,095 |
Deposits | (922,006) | (834,516) |
Redeemable subordinated debentures | (18,557) | (18,557) |
Accrued interest payable | (804) | (866) |
Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Securities available for sale | 16,080 | 12,826 |
Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Securities available for sale | 89,378 | 90,968 |
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Securities available for sale | 0 | 0 |
Reported Value Measurement [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | 18,754 | 14,886 |
Securities available for sale | 105,458 | 103,794 |
Securities held to maturity | 110,267 | 126,810 |
Loans held for sale | 4,254 | 14,829 |
Loans | 789,906 | 724,808 |
SBA servicing asset | 726 | 605 |
Interest rate lock derivative | 135 | 123 |
Accrued interest receivable | 3,478 | 3,095 |
FHLB Stock | 1,490 | 3,962 |
Deposits | (922,006) | (834,516) |
Borrowings | (20,500) | (73,050) |
Redeemable subordinated debentures | (18,557) | (18,557) |
Accrued interest payable | (804) | (866) |
Estimate of Fair Value Measurement [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents, fair value | 18,754 | 14,886 |
Securities available for sale | 105,458 | 103,794 |
Securities held to maturity, fair value | 111,865 | 128,559 |
Loans held for sale, fair value | 4,539 | 15,103 |
Loans, net, fair value | 784,064 | 716,492 |
SBA servicing asset | 1,016 | 822 |
Interest rate lock derivative | 135 | 123 |
Accrued interest receivable, fair value | 3,478 | 3,095 |
FHLB Stock | 1,490 | 3,962 |
Deposits, fair value | (920,732) | (834,050) |
Borrowings, fair value | (20,500) | (73,222) |
Redeemable subordinated debentures, fair value | (12,326) | (11,922) |
Accrued interest payable, fair value | (804) | (866) |
Estimate of Fair Value Measurement [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents, fair value | 18,754 | 14,886 |
Securities available for sale | 16,080 | 12,826 |
Securities held to maturity, fair value | 0 | 0 |
Loans held for sale, fair value | 0 | 0 |
Loans, net, fair value | 0 | 0 |
SBA servicing asset | 0 | 0 |
Interest rate lock derivative | 0 | 0 |
Accrued interest receivable, fair value | 0 | 0 |
FHLB Stock | 0 | 0 |
Deposits, fair value | 0 | 0 |
Borrowings, fair value | 0 | 0 |
Redeemable subordinated debentures, fair value | 0 | 0 |
Accrued interest payable, fair value | 0 | 0 |
Estimate of Fair Value Measurement [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents, fair value | 0 | 0 |
Securities available for sale | 89,378 | 90,968 |
Securities held to maturity, fair value | 111,865 | 128,559 |
Loans held for sale, fair value | 4,539 | 15,103 |
Loans, net, fair value | 0 | 0 |
SBA servicing asset | 1,016 | 822 |
Interest rate lock derivative | 135 | 123 |
Accrued interest receivable, fair value | 3,478 | 3,095 |
FHLB Stock | 1,490 | 3,962 |
Deposits, fair value | (920,732) | (834,050) |
Borrowings, fair value | (20,500) | (73,222) |
Redeemable subordinated debentures, fair value | (12,326) | (11,922) |
Accrued interest payable, fair value | (804) | (866) |
Estimate of Fair Value Measurement [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents, fair value | 0 | 0 |
Securities available for sale | 0 | 0 |
Securities held to maturity, fair value | 0 | 0 |
Loans held for sale, fair value | 0 | 0 |
Loans, net, fair value | 784,064 | 716,492 |
SBA servicing asset | 0 | 0 |
Interest rate lock derivative | 0 | 0 |
Accrued interest receivable, fair value | 0 | 0 |
FHLB Stock | 0 | 0 |
Deposits, fair value | 0 | 0 |
Borrowings, fair value | 0 | 0 |
Redeemable subordinated debentures, fair value | 0 | 0 |
Accrued interest payable, fair value | $ 0 | $ 0 |
Parent-only Financial Inform113
Parent-only Financial Information - Condensed Statements of Financial Condition (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Assets: | ||||
Investment securities | $ 105,458 | $ 103,794 | ||
Other assets | 6,918 | 11,582 | ||
Total assets | 1,079,274 | 1,038,213 | ||
Liabilities And Shareholders’ Equity | ||||
Subordinated debentures | 18,557 | 18,557 | ||
Shareholders’ equity | 111,653 | 104,801 | $ 95,960 | $ 87,110 |
Total liabilities and shareholders’ equity | 1,079,274 | 1,038,213 | ||
Parent Company [Member] | ||||
Assets: | ||||
Cash | 317 | 490 | ||
Investment securities | 557 | 557 | ||
Investment in subsidiary | 126,846 | 120,306 | ||
Other assets | 2,519 | 2,451 | ||
Total assets | 130,239 | 123,804 | ||
Liabilities And Shareholders’ Equity | ||||
Other liabilities | 29 | 446 | ||
Subordinated debentures | 18,557 | 18,557 | ||
Shareholders’ equity | 111,653 | 104,801 | ||
Total liabilities and shareholders’ equity | $ 130,239 | $ 123,804 |
Parent-only Financial Inform114
Parent-only Financial Information - Consolidated Statements of Income and Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income: | |||||||||||||||
Total interest income | $ 11,227 | $ 10,811 | $ 10,142 | $ 9,483 | $ 9,983 | $ 10,399 | $ 9,476 | $ 9,277 | $ 9,467 | $ 10,422 | $ 10,143 | $ 9,291 | $ 41,663 | $ 39,135 | $ 39,323 |
Expense: | |||||||||||||||
Interest expense | 1,418 | 1,451 | 1,340 | 1,289 | 1,361 | 1,355 | 1,257 | 1,185 | 1,170 | 1,169 | 1,153 | 1,144 | 5,498 | 5,158 | 4,636 |
Total Expense | 1,418 | 1,451 | 1,340 | 1,289 | 1,361 | 1,355 | 1,257 | 1,185 | 1,170 | 1,169 | 1,153 | 1,144 | 5,498 | 5,158 | 4,636 |
Income before income taxes | 3,525 | 3,713 | 2,760 | 2,801 | 3,060 | 4,151 | 3,427 | 3,270 | 2,374 | 3,610 | 3,427 | 3,315 | 12,799 | 13,908 | 12,726 |
Income tax benefit | 2,951 | 1,227 | 841 | 852 | 1,006 | 1,456 | 1,113 | 1,048 | 747 | 1,148 | 1,112 | 1,055 | 5,871 | 4,623 | 4,062 |
Net income | $ 574 | $ 2,486 | $ 1,919 | $ 1,949 | $ 2,054 | $ 2,695 | $ 2,314 | $ 2,222 | $ 1,627 | $ 2,462 | $ 2,315 | $ 2,260 | 6,928 | 9,285 | 8,664 |
Comprehensive income | 6,901 | 8,815 | 8,286 | ||||||||||||
Parent Company [Member] | |||||||||||||||
Income: | |||||||||||||||
Interest income | 16 | 13 | 11 | ||||||||||||
Dividend income from subsidiary | 1,826 | 1,240 | 366 | ||||||||||||
Total interest income | 1,842 | 1,253 | 377 | ||||||||||||
Expense: | |||||||||||||||
Interest expense | 535 | 440 | 366 | ||||||||||||
Total Expense | 535 | 440 | 366 | ||||||||||||
Income before income taxes | 1,307 | 813 | 11 | ||||||||||||
Income tax benefit | (177) | (146) | (122) | ||||||||||||
Income before equity in undistributed income of subsidiaries | 1,484 | 959 | 133 | ||||||||||||
Equity in undistributed income of subsidiaries | 5,444 | 8,326 | 8,531 | ||||||||||||
Net income | 6,928 | 9,285 | 8,664 | ||||||||||||
Equity in other comprehensive loss of subsidiaries | (27) | (470) | (378) | ||||||||||||
Comprehensive income | $ 6,901 | $ 8,815 | $ 8,286 |
Parent-only Financial Inform115
Parent-only Financial Information - Condensed Statements of Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Operating Activities: | |||||||||||||||
Net income | $ 574 | $ 2,486 | $ 1,919 | $ 1,949 | $ 2,054 | $ 2,695 | $ 2,314 | $ 2,222 | $ 1,627 | $ 2,462 | $ 2,315 | $ 2,260 | $ 6,928 | $ 9,285 | $ 8,664 |
Adjustments: | |||||||||||||||
Increase in other assets | (181) | 388 | 617 | ||||||||||||
Net cash provided by operating activities | 21,892 | 2,485 | 16,110 | ||||||||||||
Cash Flows From Investing Activities: | |||||||||||||||
Net cash used in investing activities | (51,521) | (60,553) | (22,005) | ||||||||||||
Cash Flows From Financing Activities: | |||||||||||||||
Cash dividend paid | (1,690) | (399) | 0 | ||||||||||||
Exercise of stock options | 262 | ||||||||||||||
Purchase of treasury stock, net | 0 | (24) | (359) | ||||||||||||
Net cash provided by financing activities | 33,497 | 61,586 | 2,718 | ||||||||||||
Net (decrease) increase in cash | 3,868 | 3,518 | (3,177) | ||||||||||||
Cash at beginning of year | 14,886 | 14,886 | |||||||||||||
Cash at end of year | 18,754 | 14,886 | 18,754 | 14,886 | |||||||||||
Parent Company [Member] | |||||||||||||||
Operating Activities: | |||||||||||||||
Net income | 6,928 | 9,285 | 8,664 | ||||||||||||
Adjustments: | |||||||||||||||
Increase in other assets | (68) | (126) | (92) | ||||||||||||
(Decrease) increase in other liabilities | (16) | 408 | 0 | ||||||||||||
Equity in undistributed income of subsidiaries | (5,444) | (8,326) | (8,531) | ||||||||||||
Net cash provided by operating activities | 1,400 | 1,241 | 41 | ||||||||||||
Cash Flows From Investing Activities: | |||||||||||||||
Investment in subsidiary | (130) | (501) | 37 | ||||||||||||
Net cash used in investing activities | (130) | (501) | 37 | ||||||||||||
Cash Flows From Financing Activities: | |||||||||||||||
Cash dividend paid | (1,690) | (399) | 0 | ||||||||||||
Exercise of stock options | 247 | 96 | 292 | ||||||||||||
Purchase of treasury stock, net | 0 | (24) | (359) | ||||||||||||
Net cash provided by financing activities | (1,443) | (327) | (67) | ||||||||||||
Net (decrease) increase in cash | (173) | 413 | 11 | ||||||||||||
Cash at beginning of year | $ 490 | $ 77 | $ 66 | 490 | 77 | 66 | |||||||||
Cash at end of year | $ 317 | $ 490 | $ 77 | $ 317 | $ 490 | $ 77 |
Quarterly Financial Data (Un116
Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||
Interest income | $ 11,227 | $ 10,811 | $ 10,142 | $ 9,483 | $ 9,983 | $ 10,399 | $ 9,476 | $ 9,277 | $ 9,467 | $ 10,422 | $ 10,143 | $ 9,291 | $ 41,663 | $ 39,135 | $ 39,323 |
Interest expense | 1,418 | 1,451 | 1,340 | 1,289 | 1,361 | 1,355 | 1,257 | 1,185 | 1,170 | 1,169 | 1,153 | 1,144 | 5,498 | 5,158 | 4,636 |
Net interest income | 9,809 | 9,360 | 8,802 | 8,194 | 8,622 | 9,044 | 8,219 | 8,092 | 8,297 | 9,253 | 8,990 | 8,147 | 36,165 | 33,977 | 34,687 |
Provision (credit) for loan losses | 150 | 150 | 150 | 150 | 0 | 0 | (100) | (200) | 500 | 100 | 0 | 500 | 600 | (300) | 1,100 |
Net interest income after provision (credit) for loan losses | 9,659 | 9,210 | 8,652 | 8,044 | 8,622 | 9,044 | 8,319 | 8,292 | 7,797 | 9,153 | 8,990 | 7,647 | 35,565 | 34,277 | 33,587 |
Non-interest income | 1,930 | 2,112 | 1,785 | 2,413 | 2,010 | 1,769 | 1,548 | 1,595 | 926 | 1,436 | 2,046 | 2,178 | 8,240 | 6,922 | 6,586 |
Non-interest expense | 8,064 | 7,609 | 7,677 | 7,656 | 7,572 | 6,662 | 6,440 | 6,617 | 6,349 | 6,979 | 7,609 | 6,510 | 31,006 | 27,291 | 27,447 |
Income before income taxes | 3,525 | 3,713 | 2,760 | 2,801 | 3,060 | 4,151 | 3,427 | 3,270 | 2,374 | 3,610 | 3,427 | 3,315 | 12,799 | 13,908 | 12,726 |
Income taxes | 2,951 | 1,227 | 841 | 852 | 1,006 | 1,456 | 1,113 | 1,048 | 747 | 1,148 | 1,112 | 1,055 | 5,871 | 4,623 | 4,062 |
Net income | $ 574 | $ 2,486 | $ 1,919 | $ 1,949 | $ 2,054 | $ 2,695 | $ 2,314 | $ 2,222 | $ 1,627 | $ 2,462 | $ 2,315 | $ 2,260 | $ 6,928 | $ 9,285 | $ 8,664 |
Net income per common share: | |||||||||||||||
Basic (in Dollars per share) | $ 0.07 | $ 0.31 | $ 0.24 | $ 0.24 | $ 0.26 | $ 0.34 | $ 0.29 | $ 0.28 | $ 0.21 | $ 0.31 | $ 0.29 | $ 0.29 | $ 0.86 | $ 1.17 | $ 1.10 |
Diluted (in Dollars per share) | $ 0.07 | $ 0.30 | $ 0.23 | $ 0.23 | $ 0.25 | $ 0.33 | $ 0.28 | $ 0.27 | $ 0.20 | $ 0.30 | $ 0.29 | $ 0.28 | $ 0.83 | $ 1.14 | $ 1.07 |
Subsequent Event (Details)
Subsequent Event (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||
Jun. 30, 2018$ / sharesshares | Dec. 31, 2017USD ($)office$ / shares | Nov. 06, 2017$ / shares | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Subsequent Event [Line Items] | ||||||
Share price (in Dollars per share) | $ / shares | $ 18.30 | $ 19.25 | ||||
Assets | $ 1,079,274 | $ 1,038,213 | ||||
Loans | 789,906 | 724,808 | ||||
Deposits | 922,006 | 834,516 | ||||
Shareholders' equity | 111,653 | $ 104,801 | $ 95,960 | $ 87,110 | ||
New Jersey Community Bank | ||||||
Subsequent Event [Line Items] | ||||||
Assets | 103,100 | |||||
Loans | 79,000 | |||||
Deposits | 93,700 | |||||
Shareholders' equity | $ 8,900 | |||||
Number of offices | office | 2 | |||||
New Jersey Community Bank | Scenario, Forecast | Subsequent Event | ||||||
Subsequent Event [Line Items] | ||||||
Consideration paid in shares (in Shares) | shares | 0.1309 | |||||
Consideration paid in cash (in Dollars per share) | $ / shares | $ 1.60 | |||||
Consideration paid in cash, amount placed in escrow (in Dollars per share) | $ / shares | $ 0.21 |