Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2022 | Aug. 02, 2022 | |
Document And Entity Information Abstract | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-38595 | |
Entity Registrant Name | First Western Financial Inc | |
Entity Incorporation, State or Country Code | CO | |
Entity Tax Identification Number | 37-1442266 | |
Entity Address, Address Line One | 1900 16th Street | |
Entity Address, Address Line Two | Suite 1200 | |
Entity Address, City or Town | Denver | |
Entity Address, State or Province | CO | |
Entity Address, Postal Zip Code | 80202 | |
City Area Code | 303 | |
Local Phone Number | 531.8100 | |
Title of 12(b) Security | Common Stock, no par value | |
Trading Symbol | MYFW | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 9,487,766 | |
Entity Central Index Key | 0001327607 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Cash and cash equivalents: | ||
Cash and due from banks | $ 11,790 | $ 6,487 |
Federal funds sold | 385 | 1,491 |
Interest-bearing deposits in other financial institutions | 159,431 | 379,005 |
Total cash and cash equivalents | 171,606 | 386,983 |
Available-for-sale securities, at fair value | 55,562 | |
Held-to-maturity securities, at amortized cost (fair value of $84,742 as of June 30, 2022) | 87,029 | |
Correspondent bank stock, at cost | 4,352 | 2,584 |
Mortgage loans held for sale, at fair value | 26,202 | 30,620 |
Loans (includes $21,477 and $0 measured at fair value, respectively) | 2,146,394 | 1,949,137 |
Allowance for loan losses | (14,357) | (13,732) |
Loans, net | 2,132,037 | 1,935,405 |
Premises and equipment, net | 24,236 | 23,976 |
Accrued interest receivable | 7,884 | 7,151 |
Accounts receivable | 5,192 | 5,267 |
Other receivables | 4,575 | 1,949 |
Other real estate owned, net | 378 | |
Goodwill and other intangible assets, net | 32,258 | 31,902 |
Deferred tax assets, net | 7,662 | 6,845 |
Company-owned life insurance | 15,976 | 15,803 |
Other assets | 21,960 | 23,327 |
Assets held for sale | 146 | 115 |
Total assets | 2,541,493 | 2,527,489 |
Deposits: | ||
Noninterest-bearing | 668,342 | 636,304 |
Interest-bearing | 1,501,656 | 1,569,399 |
Total deposits | 2,169,998 | 2,205,703 |
Borrowings: | ||
Federal Home Loan Bank and Federal Reserve borrowings | 87,223 | 38,629 |
Subordinated notes | 32,553 | 39,031 |
Accrued interest payable | 304 | 355 |
Other liabilities | 23,391 | 24,730 |
Total liabilities | 2,313,469 | 2,308,448 |
Shareholders' Equity | ||
Preferred stock - no par value; 10,000,000 shares authorized; 0 issued and outstanding | ||
Common stock - no par value; 90,000,000 shares authorized; 9,478,710 and 9,419,271 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively | ||
Additional paid-in capital | 189,494 | 188,629 |
Retained earnings | 40,195 | 30,189 |
Accumulated other comprehensive (loss)/income | (1,665) | 223 |
Total shareholders' equity | 228,024 | 219,041 |
Total liabilities and shareholders' equity | $ 2,541,493 | $ 2,527,489 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Loan measured at fair value | $ 21,477 | $ 0 |
Fair value (Held to Maturity) | $ 84,742 | |
Preferred Stock, par value (in dollars per share) | $ 0 | $ 0 |
Preferred Stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred Stock, shares issued | 0 | 0 |
Preferred Stock, shares outstanding | 0 | 0 |
Common Stock, par value (in dollars per share) | $ 0 | $ 0 |
Common Stock, shares authorized | 90,000,000 | 90,000,000 |
Common Stock, shares issued | 9,478,710 | 9,419,271 |
Common Stock, shares outstanding | 9,478,710 | 9,419,271 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Interest and dividend income: | ||||
Loans, including fees | $ 20,318 | $ 15,287 | $ 39,414 | $ 29,499 |
Loans accounted for under the fair value option | 346 | 346 | ||
Investment securities | 418 | 169 | 755 | 365 |
Interest-bearing deposits in other financial institutions | 549 | 92 | 781 | 183 |
Total interest and dividend income | 21,631 | 15,548 | 41,296 | 30,047 |
Interest expense: | ||||
Deposits | 1,103 | 866 | 2,046 | 1,840 |
Other borrowed funds | 390 | 459 | 828 | 931 |
Total interest expense | 1,493 | 1,325 | 2,874 | 2,771 |
Net interest income | 20,138 | 14,223 | 38,422 | 27,276 |
Less: Provision for loan losses | 519 | 12 | 729 | 12 |
Net interest income, after provision for loan losses | 19,619 | 14,211 | 37,693 | 27,264 |
Non-interest income: | ||||
Trust and investment management fees | 4,784 | 5,009 | 9,952 | 9,856 |
Net gain on mortgage loans | 1,152 | 3,914 | 3,646 | 9,110 |
Bank fees | 601 | 394 | 1,290 | 766 |
Risk management and insurance fees | 83 | 92 | 192 | 143 |
Income on company-owned life insurance | 87 | 89 | 173 | 177 |
Net gain on equity interests | 1 | |||
Net (loss)/gain on loans accounted for under the fair value option | (155) | (155) | ||
Unrealized gains/(losses) recognized on equity securities | 299 | 2 | 267 | (10) |
Other | 89 | 174 | 60 | |
Total non-interest income | 6,940 | 9,500 | 15,540 | 20,102 |
Total income before non-interest expense | 26,559 | 23,711 | 53,233 | 47,366 |
Non-interest expense: | ||||
Salaries and employee benefits | 12,945 | 9,643 | 25,003 | 19,504 |
Occupancy and equipment | 1,892 | 1,443 | 3,774 | 2,852 |
Professional services | 2,027 | 1,370 | 3,553 | 2,649 |
Technology and information systems | 1,076 | 904 | 2,122 | 1,846 |
Data processing | 987 | 1,093 | 2,174 | 2,108 |
Marketing | 428 | 398 | 985 | 719 |
Amortization of other intangible assets | 77 | 4 | 154 | 8 |
Net (gain)/loss on assets held for sale | (2) | (3) | ||
Other | 1,153 | 668 | 2,179 | 1,453 |
Total non-interest expense | 20,583 | 15,523 | 39,941 | 31,139 |
Income before income taxes | 5,976 | 8,188 | 13,292 | 16,227 |
Income tax expense | 1,494 | 1,911 | 3,286 | 3,951 |
Net income available to common shareholders | $ 4,482 | $ 6,277 | $ 10,006 | $ 12,276 |
Earnings per common share: | ||||
Basic | $ 0.47 | $ 0.79 | $ 1.06 | $ 1.54 |
Diluted | $ 0.46 | $ 0.76 | $ 1.03 | $ 1.50 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||||
Net income | $ 4,482 | $ 6,277 | $ 10,006 | $ 12,276 |
Other comprehensive income/(loss) items: | ||||
Unrealized losses on available-for-sale securities | (93) | (2,591) | (241) | |
Income tax effect | 23 | 638 | 70 | |
Reclassification adjustment of unrealized loss on available-for-sale securities transferred to held-to-maturity | 86 | 86 | ||
Income tax effect | (21) | (21) | ||
Total other comprehensive income/(loss) items | 65 | (70) | (1,888) | (171) |
Comprehensive income | $ 4,547 | $ 6,207 | $ 8,118 | $ 12,105 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income (loss) | Total |
Balance at Beginning at Dec. 31, 2020 | $ 144,703 | $ 9,579 | $ 680 | $ 154,962 | |
Balance at Beginning (in shares) at Dec. 31, 2020 | 7,951,773 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 12,276 | 12,276 | |||
Other comprehensive loss, net of tax | (171) | (171) | |||
Settlement of share awards | (406) | (406) | |||
Settlement of share awards (in shares) | 43,059 | ||||
Stock-based compensation | 1,325 | 1,325 | |||
Balance at Ending at Jun. 30, 2021 | 145,622 | 21,855 | 509 | 167,986 | |
Balance at Ending (in shares) at Jun. 30, 2021 | 7,994,832 | ||||
Balance at Beginning at Mar. 31, 2021 | 145,282 | 15,578 | 579 | 161,439 | |
Balance at Beginning (in shares) at Mar. 31, 2021 | 7,957,900 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 6,277 | 6,277 | |||
Other comprehensive loss, net of tax | (70) | (70) | |||
Settlement of share awards | (372) | (372) | |||
Settlement of share awards (in shares) | 36,932 | ||||
Stock-based compensation | 712 | 712 | |||
Balance at Ending at Jun. 30, 2021 | 145,622 | 21,855 | 509 | 167,986 | |
Balance at Ending (in shares) at Jun. 30, 2021 | 7,994,832 | ||||
Balance at Beginning at Dec. 31, 2021 | 188,629 | 30,189 | 223 | 219,041 | |
Balance at Beginning (in shares) at Dec. 31, 2021 | 9,419,271 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 10,006 | 10,006 | |||
Other comprehensive loss, net of tax | (1,888) | (1,888) | |||
Settlement of share awards | (688) | (688) | |||
Settlement of share awards (in shares) | 52,630 | ||||
Options exercised | 146 | 146 | |||
Options exercised (in shares) | 6,809 | ||||
Stock-based compensation | 1,407 | 1,407 | |||
Balance at Ending at Jun. 30, 2022 | 189,494 | 40,195 | (1,665) | 228,024 | |
Balance at Ending (in shares) at Jun. 30, 2022 | 9,478,710 | ||||
Balance at Beginning at Mar. 31, 2022 | 189,283 | 35,713 | (1,730) | 223,266 | |
Balance at Beginning (in shares) at Mar. 31, 2022 | 9,430,007 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 4,482 | 4,482 | |||
Other comprehensive loss, net of tax | 65 | 65 | |||
Settlement of share awards | (557) | (557) | |||
Settlement of share awards (in shares) | 44,405 | ||||
Options exercised | 88 | 88 | |||
Options exercised (in shares) | 4,298 | ||||
Stock-based compensation | 680 | 680 | |||
Balance at Ending at Jun. 30, 2022 | $ 189,494 | $ 40,195 | $ (1,665) | $ 228,024 | |
Balance at Ending (in shares) at Jun. 30, 2022 | 9,478,710 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Cash flows from operating activities | ||
Net income | $ 10,006 | $ 12,276 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Net amortization of investment securities | 126 | 278 |
Stock dividends received on correspondent bank stock | (33) | (43) |
Provision for loan losses | 729 | 12 |
Net gain on mortgage loans | (3,646) | (9,110) |
Origination of mortgage loans held for sale | (293,170) | (810,517) |
Proceeds from mortgage loans | 301,580 | 938,152 |
Gain on disposal of fixed assets | (50) | |
Depreciation and amortization | 1,191 | 573 |
Deferred income tax (benefit)/expense, net of valuation allowance | (2,310) | 384 |
Increase in cash surrender value of company-owned life insurance | (173) | (177) |
Stock-based compensation | 1,407 | 1,325 |
Change in fair value of equity securities | (267) | 10 |
Change in fair value of loans accounted for under the fair value option | 155 | |
Net changes in operating assets and liabilities: | ||
Change in accounts receivable | 364 | 40 |
Change in accrued interest receivable and other assets | (1,104) | 809 |
Change in accrued interest payable and other liabilities | (3,070) | (4,054) |
Net cash provided by operating activities | 11,735 | 129,948 |
Activity in available-for-sale securities: | ||
Maturities, prepayments, and calls | 3,218 | 10,877 |
Purchases | (9,000) | |
Activity in held-to-maturity securities: | ||
Maturities, prepayments, and calls | 3,124 | |
Purchases | (28,439) | |
Purchases of correspondent bank stock | (2,978) | (1) |
Redemption of correspondent bank stock | 1,243 | 543 |
Contributions to low-income housing tax credit investments | (214) | |
Loan and note receivable originations and principal collections, net | (173,985) | (37,237) |
Purchases of premises and equipment | (1,150) | (1,104) |
Purchases of loans | (24,732) | |
Proceeds from sale of other real estate owned | 194 | |
Net cash used in investing activities | (232,913) | (26,728) |
Cash flows from financing activities | ||
Net change in deposits | (35,676) | 59,143 |
Proceeds from Federal Home Loan Bank borrowings | 70,000 | |
Payments to Federal Reserve borrowings | (21,406) | (112,475) |
Proceeds from Federal Reserve borrowings | 83,674 | |
Payments on subordinated notes | (6,575) | |
Proceeds from subordinated notes, net of issuance costs | (56) | |
Proceeds from the exercise of stock options | 146 | |
Settlement of restricted stock | (688) | (406) |
Net cash provided by financing activities | 5,801 | 29,880 |
Net change in cash and cash equivalents | (215,377) | 133,100 |
Cash and cash equivalents, beginning of year | 386,983 | 155,989 |
Cash and cash equivalents, end of period | 171,606 | 289,089 |
Supplemental cash flow information: | ||
Interest paid on deposits and borrowed funds | 2,925 | 2,912 |
Income tax payment, net of refunds received | 4,118 | 2,488 |
Cash paid for lease liabilities | 2,934 | 2,581 |
Supplemental noncash disclosures: | ||
Change in unrealized loss on available-for-sale securities | (2,591) | $ (241) |
Transfer of securities from available-for-sale to held-to-maturity | 58,727 | |
Security purchase settled in subsequent period | (3,000) | |
Transfers from loans to other real estate owned | $ 378 |
ORGANIZATION AND SUMMARY OF SIG
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2022 | |
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Business and Basis of Presentation FWFI is a bank holding company with financial holding company status registered with the Board of Governors of the Federal Reserve System. FWFI wholly owns the following subsidiaries: First Western Trust Bank (the "Bank") and Ryder, Stilwell Inc. ("RSI"). The Bank wholly owns the following subsidiaries, which are therefore indirectly wholly-owned by FWFI: First Western Merger Corporation ("Merger Corp") and RRI, LLC ("RRI"). RSI and RRI are not active operating entities. The Company provides a fully-integrated suite of wealth management services including, private banking, personal trust, investment management, mortgage loans, and institutional asset management services to individual and corporate clients principally in Colorado (metro Denver, Aspen, Boulder, Fort Collins, and Vail Valley), Arizona (Phoenix and Scottsdale), California (Century City), Montana (Bozeman), and Wyoming (Jackson Hole, Laramie, Pinedale, and Rock Springs). The Company’s revenues are generated from its full range of product offerings as noted above, but principally from net interest income (the interest income earned on the Bank’s assets net of funding costs), fee-based wealth advisory, investment management, asset management and personal trust services, and net gains earned on mortgage loans. The condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission ("SEC"). Accordingly, they do not include all the information and footnotes required by GAAP for complete financial statements. The December 31, 2021 condensed consolidated balance sheet has been derived from the audited financial statements for the year ended December 31, 2021. In the opinion of management, all adjustments that were recurring in nature and considered necessary have been included for fair presentation of the Company’s financial position and results of operations. Operating results for the three and six months ended June 30, 2022 are not necessarily indicative of results that may be expected for the full year ending December 31, 2022. In preparing the condensed consolidated financial statements, the Company is required to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could be significantly different from those estimates. The condensed consolidated financial statements and notes should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 as filed with the SEC. Consolidation Business Combinations and Divestitures Use of Estimates Concentration of Credit Risk Mortgage Banking Derivatives In order to manage the interest rate risk on our uncommitted IRLC and mortgage loans held for sale pipeline, the Company enters into mortgage derivative financial instruments called To Be Announced ("TBA"), which we refer to as forward commitments. TBA agreements are forward contracts to purchase mortgage backed securities ("MBS") that will be issued by a US Government Sponsored Enterprise. The Bank purchases or sells these derivatives to offset the changes in value of our mortgage loans held for sale and IRLC adjusted pipeline where we have exposure to interest rate volatility. Changes in the fair values of these derivatives are included in the Net gain on mortgage loans line of the Condensed Consolidated Statements of Income. Revenue Recognition Transition of LIBOR to an Alternative Reference Rate In March 2020, the Financial Accounting Standards Board (‘FASB”) issued Accounting Standards Update (“ASU’) No. 2020-04 “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” These amendments provide temporary optional guidance to ease the potential burden in accounting for reference rate reform. The ASU provides optional expedients and exceptions for applying generally accepted accounting principles to contract modifications and hedging relationships, subject to meeting certain criteria, that reference the LIBOR or another reference rate expected to be discontinued. It is intended to help stakeholders during the global market-wide reference rate transition period. The guidance is effective for all entities as of March 12, 2020 through December 31, 2022. Subsequently, in January 2021, the FASB issued ASU No. 2021-01 “Reference Rate Reform (Topic 848): Scope.” This ASU clarifies that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. The ASU also amends the expedients and exceptions in Topic 848 to capture the incremental consequences of the scope clarification and to tailor the existing guidance to derivative instruments affected by the discounting transition. An entity may elect to apply ASU No. 2021-01 on contract modifications that change the interest rate used for margining, discounting, or contract price alignment retrospectively as of any date from the beginning of the interim period that includes March 12, 2020, or prospectively to new modifications from any date within the interim period that includes or is subsequent to January 7, 2021, up to the date that financial statements are available to be issued. An entity may elect to apply ASU No. 2021-01 to eligible hedging relationships existing as of the beginning of the interim period that includes March 12, 2020, and to new eligible hedging relationships entered into after the beginning of the interim period that includes March 12, 2020. Certain of the Company’s assets and liabilities are indexed to LIBOR, with exposure extending beyond December 31, 2021. The Company is currently evaluating and planning for the eventual replacement of the LIBOR benchmark interest rate, including the possibility of SOFR as the dominant replacement. In general, the transition away from LIBOR may result in increased market risk, credit risk, operational risk and business risk for the Company. The Company has developed a LIBOR transition plan, which addresses governance, risk management, legal, operational, systems, fallback language, and other aspects of planning. The company no longer originates LIBOR indexed loans and is working on transitioning existing LIBOR loans to SOFR. Consumer indexed loans are being managed in accordance with Interagency Guidance. COVID-19 and CARES Act The CARES Act created the Paycheck Protection Program ("PPP"), which is administered by the Small Business Administration ("SBA"). The PPP is intended to provide loans to small businesses to pay their employees, rent, mortgage interest, and utilities. The loans may be forgiven conditioned upon the client providing payroll documentation evidencing their compliant use of funds and otherwise complying with the terms of the program. The Bank is an approved SBA lender and supported the community and clients by originating PPP loans since the program was created. PPP loans are classified in the Cash, Securities and Other portion of the loan portfolio. See Note 4 – Loans and the Allowance for Loan Losses for further discussion on our PPP loans. As a result of the COVID-19 pandemic, a loan modification program was designed and implemented to assist our clients experiencing financial stress resulting from the economic impacts caused by the global pandemic. The Company offered loan extensions, temporary payment moratoriums, and financial covenant waivers for commercial and consumer borrowers impacted by the pandemic and had a risk rating of “pass” and had not been delinquent in making interest or principal payment by more than 30 days during the last two years. The CARES Act provides banks optional, temporary relief from accounting for certain loan modifications as troubled debt restructurings ("TDR"). The modifications must be related to the adverse effects of COVID-19, and certain other criteria are required to be met in order to apply the relief. Interagency guidance from Federal Reserve and the Federal Deposit Insurance Corporation ("FDIC") confirmed with the FASB that short-term modifications made on a good faith basis in response to COVID-19 to borrowers who were current prior to any relief, are not to be considered a TDR. We believe our loan modification program meets that definition and have not classified any of these modifications as a TDR as of June 30, 2022. See Note 4 – Loans and the Allowance for Loan Losses for further discussion on our loan modification program. The Company is a participant in the Federal Reserve’s Main Street Lending Program ("MSLP") to support lending to small and medium-sized for profit businesses and nonprofit organizations that were in sound financial condition before the onset of the COVID-19 pandemic. The Company may sell a 95% participation in a new MSLP loan to the Main Street Special Purpose Vehicle ("SPV") at par value. The Company must retain 5% of the MSLP loan until (i) it matures or (ii) neither the Main Street SPV nor a Governmental Assignee holds an interest in MSLP Loan in any capacity, whichever comes first. See Note 4 – Loans and the Allowance for Loan Losses for further discussion on our participation in the program. Reclassifications Recently adopted accounting pronouncements In January 2017, the FASB issued ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment Recently issued accounting pronouncements, not yet adopted In June 2022, the FASB issued ASU 2022-03, Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions. This was issued to clarify the guidance in Topic 820, Fair Value Measurement, when measuring fair value of an equity security subject to contractual restrictions that prohibit the sale of an equity security and to introduce new disclosure requirements for equity securities subject to contractual sale restrictions that are measured at fair value in accordance with Topic 820. The Company is currently assessing the impact of this guidance on our existing equity securities. This guidance is effective for the Company in fiscal years after December 15, 2023. In February 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326) ("ASU 2016-13"). ASU 2016-13 replaces the incurred loss model with an expected loss model, which is referred to as the current expected credit loss ("CECL") model. The CECL model is applicable to the measurement of credit losses on the financial assets measured at amortized cost, including loan receivables, held-to-maturity debt securities, and reinsurance receivables. It also applies to off-balance sheet credit exposures not accounted for as insurance (loan commitments, standby letters of credit, financial guarantees, and other similar instruments) and net investments in leases recognized by a lessor. For all other assets within the scope of CECL, a cumulative-effect adjustment will be recognized in retained earnings and the allowance for credit losses as of the beginning of the first reporting period in which the guidance is effective. ASU 2016-13 was set to be effective for most public companies on January 1, 2020. However, at the October 16, 2019 FASB meeting, the FASB voted unanimously to delay the effective date of CECL adoption for smaller reporting companies ("SRCs") to January 1, 2023. During the six months ended June 30, 2022, the Company’s CECL project team continued to work through its implementation plan. The Company has selected a champion quantitative model to approximate expected losses by call code segment using regional and other appropriate peers. The Company has selected qualitative factors and evaluated those factors for each loan segment for the quarter ended June 30, 2022. The Company has begun to document policies and procedures, internal control structure, and process flows. Using this information, the Company successfully ran parallel models for both the first and second quarters of 2022 in order for management to review and compare results between the initial CECL model and existing ALLL model. Currently, we are unable to estimate the impact the adoption of this update will have on the condensed consolidated financial statements and disclosures. However, the Company expects the impact of the adoption will be significantly influenced by the composition and characteristics of its loan portfolios along with economic conditions prevalent as of the date of adoption. The Company expects to implement the new standard beginning January 1, 2023. |
ACQUISITIONS
ACQUISITIONS | 6 Months Ended |
Jun. 30, 2022 | |
ACQUISITIONS | |
ACQUISITIONS | NOTE 2 – ACQUISITIONS On July 22, 2021, the Company entered into the Merger Agreement with Teton, parent company of Rocky Mountain Bank, a Wyoming-chartered bank headquartered in Jackson, Wyoming. The Merger Agreement provided that, subject to the terms and conditions set forth in the Merger Agreement, Teton would merge into the Company, with the Company continuing as the surviving corporation. The Merger Agreement also provided that following the merger, Rocky Mountain Bank would merge with and into the Bank, with the Bank surviving the bank merger. The transaction closed on December 31, 2021 with an aggregate purchase price of $51.3 million. As part of its long-term growth strategy, the Teton Acquisition expands First Western’s presence in Wyoming and allows the Bank to deliver its unique approach to private and commercial banking to more clients in the region. The Teton Acquisition was accounted for under the acquisition method of accounting and therefore all assets and liabilities were measured and recorded at their provisional fair values as of the acquisition close date of December 31, 2021 with final measurement period adjustments made as of March 31, 2022. All non-equity acquisition related costs were expensed as incurred. Certain acquisition costs related to the issuance of equity were capitalized as of December 31, 2021. Market value adjustments for assets acquired and liabilities assumed were amortized or accreted on a level yield basis over the estimated life of the asset or liability. Loans acquired were recorded at their estimated fair value and therefore no allowance for loan and lease losses was recorded at the date of acquisition. Additionally, core deposit intangible assets were identified and recorded at their estimated fair values and are amortized over their estimated useful life. On August 31, 2021, the Company completed the issuance and sale of subordinated notes, which provided partial funding of the transaction. See Note 8 – Borrowings for more information. The following presents the estimated fair values of the assets acquired and liabilities assumed in the transaction with Teton as of December 31, 2021, including all measurement period adjustments to the provisional estimates (dollars in thousands): Provisional Measurement Period December 31, Fair value of consideration transferred Estimates Adjustments 2021 Cash consideration $ 11,501 $ — $ 11,501 Common stock issued 39,818 — 39,818 Total fair value of consideration transferred 51,319 — 51,319 Assets acquired Cash and cash equivalents 132,498 — 132,498 Available-for-sale securities, at fair value 18,058 — 18,058 Correspondent bank stock, at cost 928 — 928 Mortgage loans held for sale 840 — 840 Loans 252,275 (857) 251,418 Premises and equipment 17,758 — 17,758 Accrued interest receivable 923 — 923 Accounts receivable 95 — 95 Other receivable 520 — 520 Core deposit intangible (1) 1,264 698 1,962 Other assets 226 242 468 Assets held for sale 115 5 120 Total assets acquired 425,500 88 425,588 Liabilities assumed Deposits 379,227 (29) 379,198 Accrued interest payable 26 — 26 Other liabilities 1,283 — 1,283 Deferred tax liabilities/(assets), net 42 (71) (29) Total liabilities assumed 380,578 (100) 380,478 Net assets acquired 44,922 188 45,110 Goodwill recognized $ 6,397 $ (188) $ 6,209 ________________________________ (1) The core deposit intangible was determined to have an estimated life of 10 years . The Company incurred $0.3 million and $0.9 million in expenses related to the acquisition during the three and six months ended June 30, 2022, respectively. The following presents the acquisition expenses within Non-interest expense of the Condensed Consolidated Statements of Income as of the date noted (dollars in thousands): Three Months Ended Six Months Ended June 30, 2022 June 30, 2022 Mergers and acquisitions expense: Salaries and employee benefits $ 152 $ 381 Professional services 274 386 Technology and information systems 4 4 Data processing (1) (93) 22 Marketing 5 75 Other 5 6 Total mergers and acquisitions expense $ 347 $ 874 ________________________________ (1) The following table presents pro forma information for the three and six months ended June 30, 2022 and 2021, as if the Teton Acquisition had occurred on January 1, 2021. This table has been prepared for comparative purposes only, and is not indicative of the actual results that would have been attained had the acquisitions occurred as of the beginning of the periods presented, nor is it indicative of future results (in thousands, except per share data): Pro Forma Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Net interest income after provision for loan losses $ 19,619 $ 16,755 $ 37,693 $ 33,211 Non-interest income 6,940 10,039 15,540 21,359 Net income 4,482 10,736 10,006 14,392 Pro forma earnings per share: Basic 0.47 1.15 1.06 1.54 Diluted 0.46 1.12 1.03 1.51 |
INVESTMENT SECURITIES
INVESTMENT SECURITIES | 6 Months Ended |
Jun. 30, 2022 | |
INVESTMENT SECURITIES | |
INVESTMENT SECURITIES | NOTE 3 - INVESTMENT SECURITIES The following presents the amortized cost and fair value of securities held-to-maturity and securities available-for-sale and the corresponding amounts of gross unrecognized gains and losses and gross unrealized gains and losses recognized in accumulated other comprehensive loss as of the dates noted (dollars in thousands): Gross Gross Amortized Unrecognized Unrecognized Fair June 30, 2022 Cost Gains Losses Value Investment securities held-to-maturity: U.S. Treasury debt $ 240 $ — $ (4) $ 236 U.S. Government Agency 252 — (2) 250 Corporate bonds 24,085 6 (651) 23,440 GNMA mortgage-backed securities – residential 43,583 — (1,089) 42,494 FNMA mortgage-backed securities – residential 7,184 — (333) 6,851 Government CMO and MBS - commercial 7,426 14 (249) 7,191 Corporate CMO and MBS 4,259 74 (53) 4,280 Total securities held-to-maturity $ 87,029 $ 94 $ (2,381) $ 84,742 Gross Gross Amortized Unrealized Unrealized Fair December 31, 2021 Cost Gains Losses Value Investment securities available-for-sale: U.S. Treasury debt $ 250 $ — $ (3) $ 247 U.S. Government Agency 3,522 — — 3,522 Corporate bonds 8,113 227 (15) 8,325 GNMA mortgage-backed securities – residential 26,611 185 (146) 26,650 FNMA mortgage-backed securities – residential 14,400 43 — 14,443 Government CMO and MBS - commercial 878 — — 878 Corporate CMO and MBS 1,492 23 (18) 1,497 Total securities available-for-sale $ 55,266 $ 478 $ (182) $ 55,562 The Company reassessed classification of investment securities and, effective April 1, 2022, elected to transfer all securities, fair valued at $58.7 million, from available-for-sale to held-to-maturity. The related unrealized loss of $2.3 million included in other comprehensive income remained in other comprehensive income and will be amortized out with an offsetting entry to interest income as a yield adjustment through earnings over the remaining term of the securities. No gain or loss was recorded at the time of transfer. As of June 30, 2022, the amortized cost and estimated fair value of held-to-maturity securities have contractual maturity dates shown in the table below (dollars in thousands). 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. Securities not due at a single maturity date are shown separately. Amortized Fair June 30, 2022 Cost Value Due within one year $ 363 $ 361 Due between one year and five years 2,233 2,196 Due between five years and ten years 21,582 20,975 Due after ten years 399 394 Securities (CMO and MBS) 62,452 60,816 Total $ 87,029 $ 84,742 In the first quarter of 2022, the Company committed $3.0 million in capital to a bank technology fund. During the six months ended June 30, 2022, the Company made $0.5 million in contributions to the partnership. As of June 30, 2022, the Company held a balance of $0.5 million, which is included in Other assets in the accompanying Condensed Consolidated Balance Sheets. The Company may be obligated to invest up to an additional $2.5 million in future contributions. In 2014, the Company began investing in a small business investment company ("SBIC") fund administered by the Small Business Administration. The Company did not make any contributions to the SBIC fund during the six months ended June 30, 2022 or the year ended December 31, 2021 and received a $0.1 million return of capital during each period. As of June 30, 2022 and December 31, 2021, the Company held a balance of $2.0 million with SBIC, which is included in Other assets in the accompanying Condensed Consolidated Balance Sheets. The Company may be obligated to invest up to an additional $1.0 million in future SBIC investments. As of June 30, 2022 and December 31, 2021, securities with carrying values totaling $17.1 million and $17.3 million, respectively, were pledged to secure various public deposits and credit facilities of the Company. As of June 30, 2022 and December 31, 2021, there were no holdings of securities of any one issuer, other than the U.S. Government sponsored entities and agencies, in an amount greater than 10% of shareholders’ equity. As of June 30, 2022 and December 31, 2021, ninety-seven securities and ten securities were in an unrealized loss position, with unrealized losses totaling $4.6 million and $0.2 million, respectively. Of the securities in an unrealized loss position as of June 30, 2022, three have been in a continuous unrealized loss position for more than twelve months and the remaining have been in a continuous unrealized loss position for less than twelve months. The unrealized loss positions were caused primarily by interest rate changes and market assumptions about prepayments of principal and interest on the underlying mortgages. Because the decline in market value is attributable to market conditions, not credit quality, and because the Company has the ability and intent to hold these investments to maturity, the Company does not consider these investments to be other-than-temporarily impaired as of June 30, 2022. The following presents securities with unrealized losses aggregated by major security type and length of time in a continuous unrealized loss position as of the dates noted (dollars in thousands, before tax): Less than 12 Months 12 Months or Longer Total Fair Unrealized Fair Unrealized Fair Unrealized June 30, 2022 Value Losses Value Losses Value Losses Investment securities held-to-maturity: U.S. Treasury debt $ 236 $ (14) $ — $ — $ 236 $ (14) U.S. Government Agency 250 (2) — — 250 (2) Corporate bonds 20,836 (689) 475 (26) 21,311 (715) GNMA mortgage-backed securities – residential 40,306 (2,131) 2,094 (248) 42,400 (2,379) FNMA mortgage-backed securities – residential 6,851 (760) — — 6,851 (760) Government CMO and MBS - commercial 6,304 (657) — — 6,304 (657) Corporate CMO and MBS 761 (36) 435 (43) 1,196 (79) Total $ 75,544 $ (4,289) $ 3,004 $ (317) $ 78,548 $ (4,606) Less than 12 Months 12 Months or Longer Total Fair Unrealized Fair Unrealized Fair Unrealized December 31, 2021 Value Losses Value Losses Value Losses Investment securities available-for-sale: U.S. Treasury debt $ 247 $ (3) $ — $ — $ 247 $ (3) Corporate bonds 485 (15) — — 485 (15) GNMA mortgage-backed securities – residential 17,205 (146) — — 17,205 (146) Corporate CMO and MBS — — 521 (18) 521 (18) Total $ 17,937 $ (164) $ 521 $ (18) $ 18,458 $ (182) The Company did not sell any securities during the three and six months ended June 30, 2022 or during the year ended December 31, 2021. |
LOANS AND THE ALLOWANCE FOR LOA
LOANS AND THE ALLOWANCE FOR LOAN LOSSES | 6 Months Ended |
Jun. 30, 2022 | |
LOANS AND THE ALLOWANCE FOR LOAN LOSSES | |
LOANS AND THE ALLOWANCE FOR LOAN LOSSES | NOTE 4 - LOANS AND THE ALLOWANCE FOR LOAN LOSSES The following presents a summary of the Company’s loans as of the dates noted (dollars in thousands): June 30, December 31, 2022 2021 Cash, Securities and Other (1) $ 180,738 $ 261,190 Consumer and Other (2) 47,855 34,758 Construction and Development 162,426 178,716 1-4 Family Residential 732,725 580,872 Non-Owner Occupied CRE 489,111 482,622 Owner Occupied CRE 224,597 212,426 Commercial and Industrial (3) 312,696 203,584 Total loans held for investment 2,150,148 1,954,168 Deferred fees and unamortized premiums/(unaccreted discounts), net (4) (3,754) (5,031) Allowance for loan losses (14,357) (13,732) Loans, net $ 2,132,037 $ 1,935,405 ______________________________________ (1) 2022 and December 31, 2021, respectively. (2) (3) (4) As of June 30, 2022 and December 31, 2021, total loans held for investment included $287.6 million and $356.7 million, respectively, of performing loans purchased through mergers or acquisitions. As of June 30, 2022 and December 31, 2021, Consumer and Other included $21.1 million and $0.0 million, respectively, of loans held for investment measured at fair value. See Note 14 – Fair Value Option. The CARES Act created the PPP, which is administered by the SBA. The PPP is intended to provide loans to small businesses to pay their employees, rent, mortgage interest, and utilities. The loans may be forgiven conditioned upon the client providing payroll documentation evidencing their compliant use of funds and otherwise complying with the terms of the program. The Bank is an approved SBA lender and as of June 30, 2022, the Cash, Securities and Other portion of the loan portfolio included $10.7 million of PPP loans, or 5.9% of the total category. As of December 31, 2021, the Cash, Securities and Other portion of the loan portfolio included $46.8 million of PPP loans, or 17.9% of the total category. The Company is a participant in the Federal Reserve’s MSLP to support lending to small and medium-sized for profit businesses and nonprofit organizations that were in sound financial condition before the onset of the COVID-19 pandemic. As of June 30, 2022, the Company’s Commercial and Industrial loans included five MSLP loans with the net carrying amount of $6.8 million, or 2.2% of the total category. As of December 31, 2021, the Company’s Commercial and Industrial loans included five MSLP loans with the net carrying amount of $6.8 million, or 3.3% of the total category. Loan Modifications As a result of the COVID-19 pandemic, a loan modification program was designed and implemented to assist our clients experiencing financial stress resulting from the economic impacts caused by the global pandemic. The Company offered loan extensions, temporary payment moratoriums, and financial covenant waivers for commercial and consumer borrowers impacted by the pandemic who have a pass risk rating and have not been delinquent over 30 days on payments in the last two years. In 2021, the deferral period ended for all non-acquired loans previously modified and payments resumed under the original terms. As of June 30, 2022, the Company’s loan portfolio included 55 non-acquired loans which were previously modified under the loan modification program, totaling $100.5 million. Through the Teton Acquisition, the Company acquired loans which were previously modified and are still in their deferral period. As of June 30, 2022, there were 15 of these loans, totaling $3.5 million. The CARES Act provides banks optional, temporary relief from accounting for certain loan modifications as a TDR. The modifications must be related to the adverse effects of COVID-19, and certain other criteria are required to be met in order to apply the relief. Interagency guidance from Federal Reserve and the FDIC confirmed with the FASB that short-term modifications made on a good faith basis in response to COVID-19 to borrowers who were current prior to any relief, are not to be considered TDRs. We believe our loan modification program meets that definition. In accordance with that guidance, the Company recognized interest income on all loans modified for temporary payment moratoriums, primarily for a period of 180 days or less. All loans modified in response to COVID-19 are classified as performing and pass rated as of June 30, 2022. These loans are included in the allowance for loan loss general reserve in accordance with ASC 450-20. Management has increased our loan level reviews and portfolio monitoring to address the changing environment. Management believes the diversity of the loan portfolio is prudent and remains consistent with the credit culture and goals of the Bank. Interest accrued during the modification term on modified loans is deferred to the end of the loan term. As of June 30, 2022, no allowance for loan loss was deemed necessary on the accrued interest balances related to loan modifications. The following presents, by class, an aging analysis of the recorded investments (excluding accrued interest receivable, deferred fees, and unamortized premiums/(unaccreted discounts), which are not material) in loans past due as of the dates noted (dollars in thousands): 30-59 60-89 90 or Total Total Days Days More Days Loans Recorded June 30, 2022 Past Due Past Due Past Due Past Due Current Investment Cash, Securities and Other $ 3,803 $ 149 $ 4 $ 3,956 $ 176,782 $ 180,738 Consumer and Other 36 35 8 79 47,776 47,855 Construction and Development — 805 — 805 161,621 162,426 1-4 Family Residential 9,705 — — 9,705 723,020 732,725 Non-Owner Occupied CRE — — — — 489,111 489,111 Owner Occupied CRE — 278 — 278 224,319 224,597 Commercial and Industrial 19,021 47 1,893 20,961 291,735 312,696 Total $ 32,565 $ 1,314 $ 1,905 $ 35,784 $ 2,114,364 $ 2,150,148 30-59 60-89 90 or Total Total Days Days More Days Loans Recorded December 31, 2021 Past Due Past Due Past Due Past Due Current Investment Cash, Securities and Other $ 745 $ — $ 6 $ 751 $ 260,439 $ 261,190 Consumer and Other 454 — 2 456 34,302 34,758 Construction and Development 2,758 — — 2,758 175,958 178,716 1-4 Family Residential 1,449 — — 1,449 579,423 580,872 Non-Owner Occupied CRE — 2,548 — 2,548 480,074 482,622 Owner Occupied CRE 1,419 — — 1,419 211,007 212,426 Commercial and Industrial 748 — 2,200 2,948 200,636 203,584 Total $ 7,573 $ 2,548 $ 2,208 $ 12,329 $ 1,941,839 $ 1,954,168 As of June 30, 2022, the Company had nine loans, totaling an immaterial amount, in the Consumer and Other portfolio that were more than 90 days delinquent and accruing interest. As of December 31, 2021, the Company had one loan, totaling an immaterial amount, in the Commercial and Industrial portfolio that was more than 90 days delinquent and accruing interest. Non-Accrual Loans and Troubled Debt Restructurings The following presents the recorded investment in non-accrual loans by class as of the dates noted (dollars in thousands): June 30, December 31, 2022 2021 Cash, Securities and Other $ 4 $ 6 Consumer and Other 2 2 1-4 Family Residential 68 75 Owner Occupied CRE 1,200 1,241 Commercial and Industrial 2,603 2,938 Total $ 3,877 $ 4,262 Non-accrual loans classified as TDRs accounted for $3.9 million of the recorded investment as of June 30, 2022 and $4.3 million as of December 31, 2021. Non-accrual loans are classified as impaired loans and individually evaluated for impairment. The following presents a summary of the unpaid principal balance of loans classified as TDRs as of the dates noted (dollars in thousands): June 30, December 31, 2022 2021 Accruing Non-Owner Occupied CRE $ 46 $ 55 Non-accrual Cash, Securities, and Other 4 6 1-4 Family Residential 68 75 Owner Occupied CRE 1,200 1,241 Commercial and Industrial 2,603 2,938 Total 3,921 4,315 Allowance for loan losses associated with TDR (261) (1,751) Net recorded investment $ 3,660 $ 2,564 As of June 30, 2022 and December 31, 2021, the Company had not committed any additional funds to a borrower with a loan classified as a TDR. The Company did not modify any loans resulting in TDR status during the six months ended June 30, 2022. The Company modified three loans resulting in TDR status during the year ended December 31, 2021. The first loan was a small mortgage with a remaining balance of $0.1 million where the borrower was unable to make payments or obtain additional financing to pay off the mortgage. As a result, we modified the loan at the maturity date with a one-year renewal to allow the borrower time to seek a refinance. As of June 30, 2022, the loan matured and has not been paid as agreed in the loan modification. The Company continues to work with the borrower on a successful resolution. The second and third loans modified are in relation to one borrower who has two loans, one Commercial Real Estate Loan in the amount of $1.2 million, which is the space where the related business operates, and a Commercial loan with a balance of $0.7 million. The borrower had experienced a reduction in cash flow through ongoing impact from the pandemic and related shut downs and hiring shortages. As a result, the Company modified both loans allowing for a six month interest only period to provide cash flow relief. The Company obtained a reduced term on the business loan as well as additional collateral from the Borrower. All three of the loans modified during 2021 were sufficiently collateralized and therefore did not require any specific reserve. TDRs are reviewed individually for impairment and are included in the Company’s specific reserves in the allowance for loan losses. If charged off, the amount of the charge-off is included in the Company’s charge-off factors, which impact the Company’s reserves on non-impaired loans. The following presents impaired loans by portfolio and related valuation allowance during the periods presented (dollars in thousands): June 30, 2022 December 31, 2021 Unpaid Allowance Unpaid Allowance Total Contractual for Total Contractual for Recorded Principal Loan Recorded Principal Loan Investment Balance Losses Investment Balance Losses Impaired loans with a valuation allowance: Consumer and Other $ 2 $ 2 $ 2 $ 2 $ 2 $ 2 Commercial and Industrial 1,893 1,893 261 2,190 2,190 1,751 Total $ 1,895 $ 1,895 $ 263 $ 2,192 $ 2,192 $ 1,753 Impaired loans with no related valuation allowance: Cash, Securities, and Other $ 4 $ 4 $ — $ 6 $ 6 $ — 1-4 Family Residential 68 68 — 75 75 — Owner Occupied CRE 1,200 1,200 — 1,241 1,241 — Commercial and Industrial 710 710 — 748 748 — Total $ 1,982 $ 1,982 $ — $ 2,070 $ 2,070 $ — Total impaired loans: Cash, Securities, and Other $ 4 $ 4 $ — $ 6 $ 6 $ — Consumer and Other 2 2 2 2 2 2 1-4 Family Residential 68 68 — 75 75 — Owner Occupied CRE 1,200 1,200 — 1,241 1,241 — Commercial and Industrial 2,603 2,603 261 2,938 2,938 1,751 Total $ 3,877 $ 3,877 $ 263 $ 4,262 $ 4,262 $ 1,753 The recorded investment in loans in the previous tables excludes accrued interest, deferred fees, and unamortized premiums/(unaccreted discounts), which are not material. Interest income, if any, was recognized on the cash basis on non-accrual loans. The following presents the average balance of impaired loans and interest income recognized on impaired loans during the periods presented (dollars in thousands): Three Months Ended June 30, 2022 2021 Average Interest Average Interest Recorded Income Recorded Income Investment Recognized Investment Recognized Impaired loans with a valuation allowance: Cash, Securities, and Other $ — $ — $ 2 $ — Consumer and Other 2 — 2 — Commercial and Industrial 2,041 — 3,230 21 Total $ 2,043 $ — $ 3,234 $ 21 Impaired loans with no related valuation allowance: Cash, Securities, and Other $ 4 $ — $ 15 $ — Owner Occupied CRE 1,211 — — 51 Commercial and Industrial 723 — 82 — 1-4 Family Residential 70 — — — Total $ 2,008 $ — $ 97 $ 51 Total impaired loans: Cash, Securities, and Other $ 4 $ — $ 17 $ — Consumer and Other 2 — 2 — Owner Occupied CRE 1,211 — — 51 Commercial and Industrial 2,764 — 3,312 21 1-4 Family Residential 70 — — — Total $ 4,051 $ — $ 3,331 $ 72 Six Months Ended June 30, 2022 2021 Average Interest Average Interest Recorded Income Recorded Income Investment Recognized Investment Recognized Impaired loans with a valuation allowance: Cash, Securities, and Other $ — $ — $ 1 $ — Consumer and Other 2 — 1 — Commercial and Industrial 2,089 — 2,162 21 Total $ 2,091 $ — $ 2,164 $ 21 Impaired loans with no related valuation allowance: Cash, Securities, and Other $ 4 $ — $ 20 $ — Owner Occupied CRE 1,221 — — 51 Commercial and Industrial 731 * 58 — 1-4 Family Residential 72 — — — Total $ 2,028 $ — $ 78 $ 51 Total impaired loans: Cash, Securities, and Other $ 4 $ — $ 21 $ — Consumer and Other 2 — 1 — Owner Occupied CRE 1,221 — — 51 Commercial and Industrial 2,820 * 2,220 21 1-4 Family Residential 72 — — — Total $ 4,119 $ — $ 2,242 $ 72 ______________________________________ * The Company recognized an immaterial amount of interest income during the period. Allowance for Loan Losses Allocation of a portion of the allowance for loan losses to one category of loans does not preclude its availability to absorb losses in other categories. The following presents the activity in the Company’s allowance for loan losses by portfolio class during the periods presented (dollars in thousands): Cash, Consumer Construction 1-4 Non-Owner Owner Commercial Securities and and Family Occupied Occupied and and Other Other Development Residential CRE CRE Industrial Total Changes in allowance for loan losses for the three months ended June 30, 2022 Beginning balance $ 1,440 $ 283 $ 954 $ 3,789 $ 2,867 $ 1,328 $ 3,224 $ 13,885 (Release)/provision for loan losses (246) (16) 120 1,056 368 149 (912) 519 Charge-offs — (95) — — — — — (95) Recoveries — 48 — — — — — 48 Ending balance $ 1,194 $ 220 $ 1,074 $ 4,845 $ 3,235 $ 1,477 $ 2,312 $ 14,357 Changes in allowance for loan losses for the six months ended June 30, 2022 Beginning balance $ 1,598 $ 266 $ 1,092 $ 3,553 $ 2,952 $ 1,292 $ 2,979 $ 13,732 (Release)/provision for loan losses (404) 58 (18) 1,292 283 185 (667) 729 Charge-offs — (192) — — — — — (192) Recoveries — 88 — — — — — 88 Ending balance $ 1,194 $ 220 $ 1,074 $ 4,845 $ 3,235 $ 1,477 $ 2,312 $ 14,357 Allowance for loan losses as of June 30, 2022 allocated to loans evaluated for impairment: Individually $ — $ 2 $ — $ — $ — $ — $ 261 $ 263 Collectively 1,194 218 1,074 4,845 3,235 1,477 2,051 14,094 Ending balance $ 1,194 $ 220 $ 1,074 $ 4,845 $ 3,235 $ 1,477 $ 2,312 $ 14,357 Loans as of June 30, 2022: Individually evaluated for impairment $ 4 $ 2 $ — $ 68 $ — $ 1,200 $ 2,603 $ 3,877 Collectively evaluated for impairment 180,734 26,704 162,426 732,657 489,111 223,397 310,093 2,125,122 Measured at fair value — 21,149 — — — — — 21,149 Ending balance $ 180,738 $ 47,855 $ 162,426 $ 732,725 $ 489,111 $ 224,597 $ 312,696 $ 2,150,148 Cash, Consumer Construction 1-4 Non-Owner Owner Commercial Securities and and Family Occupied Occupied and and Other Other Development Residential CRE CRE Industrial Total Changes in allowance for loan losses for the three months ended June 30, 2021 Beginning balance $ 2,380 $ 193 $ 766 $ 3,152 $ 2,211 $ 1,123 $ 2,714 $ 12,539 (Release)/provision for loan losses (537) 2 105 247 12 102 81 12 Charge-offs — — — — — — — — Recoveries — 1 — — — — — 1 Ending balance $ 1,843 $ 196 $ 871 $ 3,399 $ 2,223 $ 1,225 $ 2,795 $ 12,552 Changes in allowance for loan losses for the six months ended June 30, 2021 Beginning balance $ 2,439 $ 140 $ 932 $ 3,233 $ 2,004 $ 1,159 $ 2,632 $ 12,539 (Release)/provision for loan losses (596) 55 (61) 166 219 66 163 12 Charge-offs — — — — — — — — Recoveries — 1 — — — — — 1 Ending balance $ 1,843 $ 196 $ 871 $ 3,399 $ 2,223 $ 1,225 $ 2,795 $ 12,552 Allowance for loan losses as of December 31, 2021 allocated to loans evaluated for impairment: Individually $ — $ 2 $ — $ — $ — $ — $ 1,751 $ 1,753 Collectively 1,598 264 1,092 3,553 2,952 1,292 1,228 11,979 Ending balance $ 1,598 $ 266 $ 1,092 $ 3,553 $ 2,952 $ 1,292 $ 2,979 $ 13,732 Loans as of December 31, 2021: Individually evaluated for impairment $ 6 $ 2 $ — $ 75 $ — $ 1,241 $ 2,938 $ 4,262 Collectively evaluated for impairment 261,184 34,756 178,716 580,797 482,622 211,185 200,646 1,949,906 Ending balance $ 261,190 $ 34,758 $ 178,716 $ 580,872 $ 482,622 $ 212,426 $ 203,584 $ 1,954,168 The Company categorizes loans into risk categories based on relevant information about the ability of the borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Company analyzes loans individually by classifying the loans by credit risk on a quarterly basis. The Company uses the following definitions for risk ratings: Special Mention—Loans classified as special mention have a potential weakness or borrowing relationships that require more than the usual amount of management attention. Adverse industry conditions, deteriorating financial conditions, declining trends, management problems, documentation deficiencies, or other similar weaknesses may be evident. Ability to meet current payment schedules may be questionable, even though interest and principal are still being paid as agreed. The asset has potential weaknesses that may result in deteriorating repayment prospects if left uncorrected. Loans in this risk grade are not considered adversely classified. Substandard—Substandard loans are considered "classified" and are inadequately protected by the current net worth and paying capacity of the obligor or by the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardizes the liquidation of the debt. They are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected. Loans in this category may be placed on non-accrual status and may individually be evaluated for impairment if indicators of impairment exist. Doubtful—Loans graded Doubtful are considered "classified" and have all the weaknesses inherent in those classified as Substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently known facts, conditions, and values, highly questionable and improbable. However, the amount of certainty of eventual loss is not known because of specific pending factors. Loans accounted for under the fair value option are not rated. Loans not meeting any of the three criteria above are considered to be pass-rated loans. The following presents, by class and by credit quality indicator, the recorded investment in the Company’s loans as of the dates noted (dollars in thousands): Special June 30, 2022 Pass Mention Substandard Not Rated Total Cash, Securities and Other $ 180,734 $ — $ 4 $ — $ 180,738 Consumer and Other 26,704 — 2 21,149 47,855 Construction and Development 162,426 — — — 162,426 1-4 Family Residential 732,657 — 68 — 732,725 Non-Owner Occupied CRE 483,848 5,263 — — 489,111 Owner Occupied CRE 222,714 — 1,883 — 224,597 Commercial and Industrial 305,765 2,693 4,238 — 312,696 Total $ 2,114,848 $ 7,956 $ 6,195 $ 21,149 $ 2,150,148 Special December 31, 2021 Pass Mention Substandard Not Rated Total Cash, Securities and Other $ 261,184 $ — $ 6 $ — $ 261,190 Consumer and Other 34,756 — 2 — 34,758 Construction and Development 176,194 2,522 — — 178,716 1-4 Family Residential 580,797 — 75 — 580,872 Non-Owner Occupied CRE 476,670 5,952 — — 482,622 Owner Occupied CRE 210,493 — 1,933 — 212,426 Commercial and Industrial 198,368 401 4,815 — 203,584 Total $ 1,938,462 $ 8,875 $ 6,831 $ — $ 1,954,168 The Company had no loans graded doubtful as of June 30, 2022 and December 31, 2021. |
GOODWILL
GOODWILL | 6 Months Ended |
Jun. 30, 2022 | |
Goodwill. | |
Goodwill | NOTE 5 - GOODWILL The following presents changes in the carrying amount of goodwill as of the dates noted (dollars in thousands): June 30, December 31, 2022 2021 Beginning balance $ 30,588 $ 24,191 Acquisition activity (188) 6,397 Ending balance $ 30,400 $ 30,588 During the year ended December 31, 2021, the Company recorded $6.4 million of goodwill as a result of the Teton Acquisition on December 31, 2021. In the first quarter of 2022, goodwill was adjusted by ($0.2) million as a result of the measurement period adjustments. See Note 2 – Acquisitions for more information. Goodwill is tested annually for impairment on October 31 or earlier upon the occurrence of certain events. The goodwill impairment analysis includes the determination of the carrying value of the reporting unit, including the existing goodwill, and estimating the fair value of the reporting unit. If the fair value is less than its carrying amount, goodwill impairment is recognized equal to the difference between the fair value and its carrying amount, not to exceed its carrying amount. As of June 30, 2022, there has not been any impairment of goodwill identified or recorded. Goodwill totaled $30.4 million and $30.6 million as of June 30, 2022 and December 31, 2021, respectively. |
LEASES
LEASES | 6 Months Ended |
Jun. 30, 2022 | |
LEASES | |
LEASES | NOTE 6 - LEASES Leases in which the Company is determined to be the lessee are primarily operating leases comprised of real estate property and office space for our corporate headquarters and profit centers with terms that extend to 2032. In accordance with ASC 842, operating leases are required to be recognized as a right-of-use asset with a corresponding lease liability. The Company elected to not include short-term leases with initial terms of twelve months or less on the Condensed Consolidated Balance Sheets. The following presents the classification of the right-of-use assets and corresponding liabilities within the Condensed Consolidated Balance Sheets, as of the dates noted (dollars in thousands). June 30, December 31, 2022 2021 Lease Right-of-Use Assets Classification Operating lease right-of-use assets Other assets $ 9,431 $ 10,720 Lease Liabilities Classification Operating lease liabilities Other liabilities $ 12,325 $ 13,863 The Company’s operating lease agreements typically include an option to renew the lease at the Company’s discretion. To the extent the Company is reasonably certain it will exercise the renewal option at the inception of the lease, the Company will include the extended term in the calculation of the right-of-use asset and lease liability. ASC 842 requires the use of the rate implicit in the lease when it is readily determinable. As this rate is typically not readily determinable, at the inception of the lease, the Company uses its collateralized incremental borrowing rate over a similar term. The amount of the right-of-use asset and lease liability are impacted by the discount rate used to calculate the present value of the minimum lease payments over the term of the lease. June 30, December 31, 2022 2021 Weighted-Average Remaining Lease Term Operating leases 4.97 years 5.26 years Weighted-Average Discount Rate Operating leases 2.60 % 2.67 % The Company’s operating leases contain fixed and variable lease components and it has elected to account for all classes of underlying assets as a single lease component. Variable lease costs primarily represent common area maintenance and parking. The Company recognized lease costs in Occupancy and equipment expense in the accompanying Condensed Consolidated Statements of Income. The following presents the Company’s net lease costs during the periods presented (dollars in thousands): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Lease Costs Operating lease cost $ 824 $ 731 $ 1,619 $ 1,483 Variable lease cost 528 416 1,086 828 Lease costs, net $ 1,352 $ 1,147 $ 2,705 $ 2,311 The following presents a maturity analysis of the Company’s operating lease liabilities on an annual basis for each of the next five years and total amounts thereafter (dollars in thousands): Year Ending December 31, Operating Leases 2022 (1) $ 1,755 2023 3,210 2024 3,064 2025 2,073 2026 703 Thereafter 2,168 Total future minimum lease payments 12,973 Less: imputed interest (648) Present value of net future minimum lease payments $ 12,325 ________________________________________ (1) Undiscounted Year Ending December 31, Operating Lease Income 2022 (1) $ 134 2023 221 2024 199 2025 — 2026 — Thereafter — Total undiscounted operating lease income $ 554 ________________________________________ (1) |
DEPOSITS
DEPOSITS | 6 Months Ended |
Jun. 30, 2022 | |
DEPOSITS | |
DEPOSITS | NOTE 7 - DEPOSITS The following presents the Company’s interest-bearing deposits as of the dates noted (dollars in thousands): June 30, December 31, 2022 2021 Money market deposit accounts $ 1,033,739 $ 1,056,669 Time deposits 147,623 170,491 Negotiable order of withdrawal accounts 287,195 309,940 Savings accounts 33,099 32,299 Total interest-bearing deposits $ 1,501,656 $ 1,569,399 Aggregate time deposits of $250 or greater $ 70,492 $ 75,747 Overdraft balances classified as loans totaled $0.1 million and an immaterial amount as of June 30, 2022 and December 31, 2021, respectively. The following presents the scheduled maturities of all time deposits for each of the next five years and total amounts thereafter (dollars in thousands): Year ending December 31, Time Deposits 2022 (1) $ 64,114 2023 46,252 2024 17,812 2025 3,029 2026 10,337 Thereafter 6,079 Total $ 147,623 ________________________________________ (1) |
BORROWINGS
BORROWINGS | 6 Months Ended |
Jun. 30, 2022 | |
BORROWINGS | |
BORROWINGS | NOTE 8 - BORROWINGS The Bank has executed a blanket pledge and security agreement with the FHLB that requires certain loans and securities be pledged as collateral for any outstanding borrowings under the agreement. The collateral pledged as of June 30, 2022 and December 31, 2021 amounted to $856.6 million and $771.4 million, respectively. Based on this collateral and the Company’s holdings of FHLB stock, the Company was eligible to borrow an additional $517.0 million as of June 30, 2022. Each advance is payable at its maturity date. The following presents the Company’s required maturities on FHLB borrowings as of the dates noted (dollars in thousands): June 30, December 31, Maturity Date Rate % 2022 2021 April 22, 2022 0.37 $ — $ 5,000 July 1, 2022 (1) 1.63 70,000 — May 5, 2023 0.76 10,000 10,000 Total $ 80,000 $ 15,000 ________________________________________ (1) To bolster the effectiveness of the SBA’s PPP, the Federal Reserve is supplying liquidity to participating financial institutions through term financing collateralized by PPP loans to small businesses. The Paycheck Protection Program Liquidity Facility ("PPPLF") extends credit to eligible financial institutions that originate PPP loans, taking the loans as collateral at face value and bearing interest at 35 bps. The terms of the loans are directly tied to the underlying PPP loans, which were originated at 2 The Bank has borrowing capacity associated with three unsecured federal funds lines of credit up to $10.0 million, $19.0 million, and $25.0 million. As of June 30, 2022 and December 31, 2021, there were no amounts outstanding on any of the federal funds lines. On August 31, 2021, the Company completed the issuance and sale of subordinated notes (the "Notes") totaling $15.0 million in aggregate principal amount. The issuance included $0.3 million of issuance costs and as of June 30, 2022, a net balance of $14.8 million is included in the Subordinated notes line of the Condensed Consolidated Balance Sheets. The Notes accrue interest at a rate of 3.25% per annum until September 1, 2026, at which time the rate will adjust each quarter to the then current three-month SOFR, or an alternative rate determined in accordance with the terms of the Notes, plus 258 basis points; mature on September 1, 2031; are redeemable at the option of the Company on or after September 1, 2026; and pay interest quarterly. On November 25, 2020, the Company completed the issuance and sale of subordinated notes (the "November 2020 Sub Notes") totaling $10.0 million in aggregate principal amount. The issuance included $0.2 million of issuance costs and as of June 30, 2022, a net balance of $9.9 million is included in the Subordinated notes line of the Condensed Consolidated Balance Sheets. The November 2020 Sub Notes accrue interest at a rate of 4.25% per annum until December 1, 2025, at which time the rate will adjust each quarter to the then current three-month term SOFR, or an alternative rate determined in accordance with the terms of the November 2020 Sub Notes, plus 402 basis points; mature on December 1, 2030; are redeemable at the option of the Company on or after December 1, 2025; and pay interest semi-annually prior to December 1, 2025 and quarterly after December 1, 2025. On March 17, 2020, the Company completed the issuance and sale of subordinated notes (the ‘March 2020 Sub Notes”) totaling $8.0 million in aggregate principal amount. The issuance included $0.1 million of issuance costs and as of June 30, 2022, a net balance of $7.9 million is included in the Subordinated notes line of the Condensed Consolidated Balance Sheets. The March 2020 Sub Notes accrue interest at a rate of 5.125% per annum until March 31, 2025, at which time the rate will adjust each quarter to the then current three-month LIBOR, or an alternative rate determined in accordance with the terms of the March 2020 Sub Notes, plus 450 basis points; mature on March 31, 2030; are redeemable at the option of the Company on or after March 31, 2025; and pay interest quarterly. The Company’s borrowing facilities include various financial and other covenants, including, but not limited to, a requirement that the Bank maintains regulatory capital that is deemed "well capitalized" by federal banking agencies. See Note 17 – Regulatory Capital Matters for additional information. As of June 30, 2022 and December 31, 2021, the Company was in compliance with the covenant requirements. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2022 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | NOTE 9 - COMMITMENTS AND CONTINGENCIES The Company is party to credit-related financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its clients. These financial instruments include commitments to extend credit. Such commitments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the Condensed Consolidated Balance Sheets. Commitments may expire without being utilized. The Company’s exposure to loan loss is represented by the contractual amount of these commitments, although material losses are not anticipated. The Company follows the same credit policies in making commitments as it does for on-balance sheet instruments. The following presents the Company’s financial instruments whose contract amounts represent credit risk, as of the dates noted (dollars in thousands): June 30, 2022 December 31, 2021 Fixed Rate Variable Rate Fixed Rate Variable Rate Unused lines of credit $ 128,605 $ 575,094 $ 136,289 $ 442,035 Standby letters of credit 6,263 22,035 2,420 20,940 Commitments to make loans to sell 37,841 — 60,529 — Commitments to make loans 52,056 17,749 16,256 14,920 Unused lines of credit are agreements to lend to a client as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Several of the commitments may expire without being drawn upon. Therefore, the total commitment amounts do not necessarily represent future cash requirements. The amount of collateral obtained, if it is deemed necessary by the Company, is based on management’s credit evaluation of the client. Unused lines of credit under commercial lines of credit, revolving credit lines, and overdraft protection agreements are commitments for possible future extensions of credit to existing clients. These lines of credit are uncollateralized and usually do not contain a specified maturity date and may not be drawn upon to the total extent to which the Company is committed. Standby letters of credit are conditional commitments issued by the Company to guarantee the performance of a client’s obligation to a third party. Those letters of credit are primarily issued to support public and private borrowing arrangements. Substantially all letters of credit issued have expiration dates within one year. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to clients. The Company holds collateral supporting those commitments if deemed necessary. Commitments to make loans to sell are agreements to lend to a client which would then be sold to an investor in the secondary market for which the interest rate has been locked with the client, provided there is no violation of any condition within the contract with either party. Commitments to make loans to sell have fixed interest rates. Since commitments may expire without being extended, total commitment amounts may not necessarily represent cash requirements. Commitments to make loans are agreements to lend to a client, provided there is no violation of any condition within the contract. Commitments to make loans generally have fixed expiration dates or other termination clauses. Since commitments may expire without being extended, total commitment amounts may not necessarily represent cash requirements. Litigation, Claims and Settlements The Company is, from time to time, involved in various legal actions arising in the normal course of business. While the ultimate outcome of any such proceedings cannot be predicted with certainty, it is the opinion of management, based on advice from legal counsel, that no proceedings exist, either individually or in the aggregate, which, if determined adversely to the Company, would have a material effect on the Company’s condensed consolidated financial statements. |
SHAREHOLDERS EQUITY
SHAREHOLDERS EQUITY | 6 Months Ended |
Jun. 30, 2022 | |
SHAREHOLDERS EQUITY | |
SHAREHOLDERS EQUITY | NOTE 10 - SHAREHOLDERS’ EQUITY Common Stock The Company’s common stock has no par value and each holder of common stock is entitled to one vote for each share (though certain voting restrictions may exist on non-vested restricted stock) held. On January 6, 2022, the Company filed a Form S-3 Registration Statement with the SEC providing that the Company may offer and sell from time to time, separately or together, in multiple series or in one or more offerings, any combination of common stock, preferred stock, debt securities, warrants, depository shares and units, up to a maximum aggregate offer price of $100 million. On November 3, 2020, the Company announced that its board of directors authorized the repurchase of up to 400,000 shares of the Company’s common stock, no par value (the "2020 Repurchase Plan") and that the Board of Governors of the Federal Reserve System advised the Company that it has no objection to the Company’s 2020 Repurchase Plan. The 2020 Repurchase Plan was in effect for a one-year During the six months ended June 30, 2022 and 2021, the Company sold no shares of common stock. Restricted Stock Awards In 2017, the Company issued 105,264 shares of common stock ("Restricted Stock Awards") with a value of $3.0 million to the sole member of EMC Holdings, LLC ("EMC"), subject to forfeiture based on his continued employment with the Company. Half of the Restricted Stock Awards ($1.5 million or 52,632 shares) vests ratably over five years As of June 30, 2022, the Restricted Stock Awards have a weighted-average grant date fair value of $28.50 per share. During the three months ended June 30, 2022 and 2021, the Company recognized compensation expense of $0.1 million for the Restricted Stock Awards. During the six months ended June 30, 2022 and 2021, the Company recognized compensation expense of $0.2 million for the Restricted Stock Awards. As of June 30, 2022, the Company has $ 0.1 Stock-Based Compensation Plans The 2008 Stock Incentive Plan ("the 2008 Plan") was frozen in connection with the adoption of the 2016 Plan and no new awards may be granted under the 2008 Plan. As of June 30, 2022, there were a total of 202,565 shares available for issuance under the First Western Financial, Inc. 2016 Omnibus Incentive Plan ("the 2016 Plan"). If the Awards outstanding under the 2008 Plan or the 2016 Plan are forfeited, cancelled or terminated with no consideration paid to the Company, those amounts will increase the number of shares eligible to be granted under the 2016 Plan. Stock Options The Company did not grant any stock options during the six months ended June 30, 2022 and 2021. During the three and six months ended June 30, 2022, the Company recognized no stock based compensation expense associated with stock options. During the three and six months ended June 30, 2021, the Company recognized an immaterial amount of stock based compensation expense associated with stock options. As of June 30, 2022, the Company has no unrecognized stock-based compensation expense related to stock options. The following presents activity for nonqualified stock options during the six months ended June 30, 2022: Weighted Weighted Average Number Average Remaining Aggregate of Exercise Contractual Intrinsic Options Price Term Value Outstanding as of December 31, 2021 308,574 $ 29.21 Granted — — Exercised (6,809) 21.47 Forfeited or expired (116,100) 40.00 Outstanding as of June 30, 2022 185,665 22.75 2.6 (1) Options fully vested / exercisable as of June 30, 2022 185,665 22.75 2.6 (1) ______________________________________ (1) As of June 30, 2022, there were 185,665 options that were exercisable. Exercise prices are between $20.00 and $27.00 per share, and the options are exercisable for a period of ten years from the original grant date and expire on various dates between 2023 and 2026. Restricted Stock Units Pursuant to the 2016 Plan, the Company can grant associates and non-associate directors long-term cash and stock-based compensation. Historically, the Company has granted certain associates restricted stock units which are earned over time or based on various performance measures and convert to common stock upon vesting, which are summarized here and expanded further below. The following presents the activity for the Time Vesting Units, the Financial Performance Units, and the Market Performance Units during the six months ended June 30, 2022: Time Financial Market Vesting Performance Performance Units Units Units Outstanding as of December 31, 2021 249,821 183,483 13,746 Granted 126,004 64,629 — Vested (75,220) (12,100) — Forfeited (14,007) (12,086) (13,746) Outstanding as of June 30, 2022 286,598 223,926 — During the three months ended June 30, 2022, the Company issued 53,461 shares of common stock upon the settlement of Restricted Stock Units. The remaining 21,345 shares were surrendered with a combined market value at the dates of settlement of $0.7 million to cover employee withholding taxes. During the six months ended June 30, 2022, the Company issued 61,686 shares of common stock upon the settlement of Restricted Stock Units. The remaining 25,634 shares were surrendered with a combined market value at the dates of settlement of $0.8 million to cover employee withholding taxes. During the three months ended June 30, 2021, the Company issued 36,932 shares of common stock upon the settlement of Restricted Stock Units. The remaining 14,545 shares were surrendered with a combined market value at the dates of settlement of $0.4 million to cover employee withholding taxes. During the six months ended June 30, 2021, the Company issued 43,059 shares of common stock upon the settlement of Restricted Stock Units. The remaining 17,369 shares were surrendered with a combined market value at the dates of settlement of $0.4 million to cover employee withholding taxes. Time Vesting Units Time Vesting Units are granted to full-time associates and board members at the date approved by the Company’s board of directors. The Company granted 126,004 Time Vesting Units with a five-year service period during the six months ended June 30, 2022 that vest in equal installments of 20% on the anniversary of the grant date, assuming continuous employment through the scheduled vesting dates. During the three months ended June 30, 2022 and 2021, the Company recognized compensation expense of $0.4 million for the Time Vesting Units. During the six months ended June 30, 2022 and 2021, the Company recognized compensation expense of $0.9 million and $0.8 million, respectively, for the Time Vesting Units. As of June 30, 2022, there was $6.4 million of unrecognized compensation expense related to the Time Vesting Units, which is expected to be recognized over a weighted-average period of 2.2 years. Financial Performance Units Financial Performance Units are granted to certain key associates and are earned based on the Company achieving various financial performance metrics. If the Company achieves the financial metrics, which include various thresholds from 0% up to 150%, then the Financial Performance Units will have a subsequent vesting period. The following presents the Company’s existing Financial Performance Units as of June 30, 2022 (dollars in thousands, except share amounts): Grant Period Threshold Accrual Maximum Issuable Shares at Current Threshold Unrecognized Compensation Expense Weighted-Average (1) Financial Metric End Date Vesting Requirement End Date May 1, 2019 through April 30, 2020 150% 76,797 $ 242 1.6 years December 31, 2021 December 31, 2023 May 1, 2020 through December 31, 2020, excluding November 18, 2020 150% 76,886 345 2.5 years December 31, 2022 December 31, 2023 On November 18, 2020 134% 29,212 278 2.4 years December 31, 2022 50% November 18, 2023 & 2025 May 3, 2021 through August 11, 2021 150% 56,148 735 3.5 years December 31, 2023 December 31, 2025 On May 2, 2022 79% 49,127 2,988 4.5 years December 31, 2024 December 31, 2026 ______________________________________ (1) The following presents the Company’s Financial Performance Units activity during the periods presented (dollars in thousands, except share amounts): Units Granted Compensation Expense Recognized Six Months Ended June 30, Three Months Ended June 30, Six Months Ended June 30, Grant Period 2022 2021 2022 2021 2022 2021 Prior to May 1, 2019 — — $ — 3 — $ 18 May 1, 2019 through April 30, 2020 — — 29 61 90 117 May 1, 2020 through December 31, 2020, excluding November 18, 2020 — — 29 54 82 109 On November 18, 2020 — (2) 30 28 64 May 3, 2021 through August 11, 2021 — 41,366 58 57 139 57 On May 2, 2022 64,629 — 58 — 58 — Market Performance Units Market Performance Units were granted to certain key associates and are earned based on growth in the value of the Company’s common stock, and were dependent on the Company completing an initial public offering of stock during a defined period of time. On July 23, 2018, the Company completed its initial public offering and the Market Performance Units performance condition was met. Subsequent to the performance condition there is also a market condition as a vesting requirement for the Market Performance Units which affects the determination of the grant date fair value. The Company estimated the grant date fair value using various valuation assumptions. During the three and six months ended June 30, 2022 and 2021, the Company recognized an immaterial amount of compensation expense for the Market Performance Units. As of June 30, 2022, the Company has no unrecognized compensation expense related to the Market Performance Units. If the Company’s common stock is trading at or above certain prices, over a performance period which ended on June 30, 2020, the Market Performance Units would have been determined to be earned and vest following the completion of a subsequent service period, which ended on June 30, 2022. The Company’s common stock did not trade at or above the required prices over the performance period and as a result, no Market Performance Units were eligible to be earned. |
EARNINGS PER COMMON SHARE
EARNINGS PER COMMON SHARE | 6 Months Ended |
Jun. 30, 2022 | |
EARNINGS PER COMMON SHARE | |
EARNINGS PER COMMON SHARE | NOTE 11 - EARNINGS PER COMMON SHARE The following presents the calculation of basic and diluted earnings per common share during the periods presented (dollars in thousands, except share and per share amounts): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Earnings per common share - Basic Numerator: Net income available for common shareholders $ 4,482 $ 6,277 $ 10,006 $ 12,276 Denominator: Basic weighted average shares 9,450,987 7,961,785 9,434,742 7,948,796 Earnings per common share - basic $ 0.47 $ 0.79 $ 1.06 $ 1.54 Earnings per common share - Diluted Numerator: Net income available for common shareholders $ 4,482 $ 6,277 $ 10,006 $ 12,276 Denominator: Basic weighted average shares 9,450,987 7,961,785 9,434,742 7,948,796 Diluted effect of common stock equivalents: Stock options 52,870 35,849 55,005 20,386 Time Vesting Units 122,090 131,684 155,813 117,107 Financial Performance Units 91,720 70,746 92,524 59,953 Market Performance Units — 13,836 6,827 14,017 Total diluted effect of common stock equivalents 266,680 252,115 310,169 211,463 Diluted weighted average shares 9,717,667 8,213,900 9,744,911 8,160,259 Earnings per common share - diluted $ 0.46 $ 0.76 $ 1.03 $ 1.50 Diluted earnings per share was computed without consideration to potentially dilutive instruments as their inclusion would have been anti-dilutive. The following presents potentially dilutive securities excluded from the diluted earnings per share calculation during the periods presented: Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Stock options — 141,639 — 209,874 Time Vesting Units 121,942 — 60,971 1,991 Financial Performance Units — 26,735 — 24,952 Restricted Stock Awards — — — 10,527 Total potentially dilutive securities 121,942 168,374 60,971 247,344 |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2022 | |
INCOME TAXES | |
INCOME TAXES | NOTE 12 - INCOME TAXES During the three and six months ended June 30, 2022, the Company recorded an income tax provision of $1.5 million and $3.3 million, respectively, reflecting an effective tax rate of 25.0% and 24.7%, respectively. During the three and six months ended June 30, 2021, the Company recorded an income tax provision of $1.9 million and $4.0 million, respectively, reflecting an effective tax rate of 23.3% and 24.3%, respectively. |
RELATED-PARTY TRANSACTIONS
RELATED-PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2022 | |
RELATED-PARTY TRANSACTIONS | |
RELATED-PARTY TRANSACTIONS | NOTE 13 - RELATED-PARTY TRANSACTIONS The Bank extends credit to certain covered parties including Company directors, executive officers, and their affiliates. As of June 30, 2022 and December 31, 2021, there were no delinquent or non-performing loans to any executive officer or director of the Company. These covered parties, along with principal owners, management, immediate family of management or principal owners, a parent company and its subsidiaries, trusts for the benefit of employees, and other parties, may be considered related parties. The following presents a summary of related-party loan activity as of the dates noted (dollars in thousands): June 30, 2022 December 31, 2021 Balance, beginning of year $ 12,833 $ 14,321 Funded loans 12,880 11,294 Payments collected (7,102) (12,782) Balance, end of period $ 18,611 $ 12,833 Deposits from related parties held by the Bank as of June 30, 2022 and December 31, 2021 totaled $38.6 million and $51.0 million, respectively. The Company leases office spaces from entities controlled by one of the Company’s board members. During each of the six months ended June 30, 2022 and 2021, the Company incurred $0.1 million of expenses related to these leases. |
FAIR VALUE
FAIR VALUE | 6 Months Ended |
Jun. 30, 2022 | |
FAIR VALUE | |
FAIR VALUE | NOTE 14 - FAIR VALUE Fair value is the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There are three levels of inputs that may be used to measure fair values: Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date. Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. Level 3: Significant unobservable inputs that reflect a company’s own assumptions about the assumptions that market participants would use in pricing an asset or liability. Recurring Fair Value Available-for-sale securities : Equity Securities Equity Warrants Guarantee Asset and Liability : Mortgage Related Derivatives : Loans Held for Investment Mortgage Loans Held for Sale : The following presents assets and liabilities measured on a recurring basis as of the dates noted (dollars in thousands): Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Assets Inputs Inputs Reported June 30, 2022 (Level 1) (Level 2) (Level 3) Balance Mortgage loans held for sale $ — $ 26,202 $ — $ 26,202 Loans held at fair value $ — $ — $ 21,477 $ 21,477 Forward commitments and FSC $ — $ 239 $ — $ 239 Equity securities $ 655 $ 122 $ — $ 777 Guarantee asset $ — $ — $ 174 $ 174 IRLC, net $ — $ — $ 836 $ 836 Equity warrants $ — $ — $ 725 $ 725 Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Assets Inputs Inputs Reported December 31, 2021 (Level 1) (Level 2) (Level 3) Balance Investment securities available-for-sale: U.S. Treasury debt $ 247 $ — $ — $ 247 U.S. Government Agency — 3,522 — 3,522 Corporate bonds — 6,212 2,113 8,325 GNMA mortgage-backed securities - residential — 26,650 — 26,650 FNMA mortgage-backed securities - residential — 14,443 — 14,443 Government CMO and MBS — 878 — 878 Corporate CMO and MBS — 1,497 — 1,497 Total securities available-for-sale $ 247 $ 53,202 $ 2,113 $ 55,562 Mortgage loans held for sale $ — $ 30,620 $ — $ 30,620 Forward commitments and FSC $ — $ (65) $ (9) $ (74) Equity securities $ 709 $ 489 $ — $ 1,198 Guarantee asset $ — $ — $ 237 $ 237 IRLC, net $ — $ — $ 1,473 $ 1,473 Equity warrants $ — $ — $ 160 $ 160 There were no transfers between levels during the six months ended June 30, 2022 or year ended December 31, 2021. On April 1, 2022, the Company elected to transfer all securities classified as available-for-sale to held-to-maturity and are now carried at amortized cost. See Note 3 – Investment Securities for more information. As of December 31, 2021, U.S. Treasury debt was reported at fair value utilizing Level 1 inputs. Three Corporate bonds were reported at fair value utilizing Level 3 inputs. The remaining portfolio of securities were reported at fair value with Level 2 inputs provided by a pricing service. The majority of the securities had credit support provided by the Federal Home Loan Mortgage Corporation, GNMA, and FNMA. Factors used to value the securities by the pricing service include: benchmark yields, reported trades, interest spreads, prepayments, and other market research. In addition, ratings and collateral quality were considered. As of June 30, 2022, equity securities, equity warrants, IRLC, and guarantee assets have been recorded at fair value within the Other assets line item in the Condensed Consolidated Balance Sheets. All changes are recorded in the Other line item in the Condensed Consolidated Statements of Income. Fair Value Option June 30, 2022 Total Loans Non Accruals 90 Days or More Past Due Fair Value Carrying Amount Unpaid Principal Balance Difference Fair Value Carrying Amount Unpaid Principal Balance Difference Fair Value Carrying Amount Unpaid Principal Balance Difference Loans held for sale $ 26,202 $ 25,858 $ 344 $ — $ — $ — $ — $ — $ — Loans held for investment 21,477 21,149 328 — — — — — — $ 47,679 $ 47,007 $ 672 $ — $ — $ — $ — $ — $ — December 31, 2021 Total Loans Non Accruals 90 Days or More Past Due Fair Value Carrying Amount Unpaid Principal Balance Difference Fair Value Carrying Amount Unpaid Principal Balance Difference Fair Value Carrying Amount Unpaid Principal Balance Difference Loans held for sale $ 30,620 $ 29,857 $ 763 $ — $ — $ — $ — $ — $ — Loans held for investment — — — — — — — — — $ 30,620 $ 29,857 $ 763 $ — $ — $ — $ — $ — $ — Three Months Ended Six Months Ended June 30, June 30, 2022 2021 2022 2021 Loans held for sale $ (394) $ 417 $ (419) $ (4,165) Loans held for investment 328 — 328 — $ (66) $ 417 $ (91) $ (4,165) The following summarizes the activity pertaining to loans accounted for under the fair value option as of the dates noted (dollars in thousands): Three Months Ended Six Months Ended June 30, June 30, Loans held for sale 2022 2021 2022 2021 Balance at beginning of period $ 33,663 $ 176,644 $ 30,620 $ 161,843 Loans originated 278,720 365,423 470,494 901,777 Fair value changes (394) 417 (419) (4,165) Sales (285,777) (493,029) (474,443) (1,007,574) Settlements (10) (892) (50) (3,318) Balance at end of period $ 26,202 $ 48,563 $ 26,202 $ 48,563 Three Months Ended Six Months Ended June 30, June 30, Loans held for investment 2022 2021 2022 2021 Balance at beginning of period $ 6,380 $ — $ — $ — Loans acquired 17,869 — 24,249 — Fair value changes 328 — 328 — Settlements (3,100) — (3,100) — Balance at end of period $ 21,477 $ — $ 21,477 $ — Nonrecurring Fair Value Other Real Estate Owned (“OREO”) : Impaired Loans : Appraisals for both collateral-dependent impaired loans and OREO are performed by certified general appraisers (for commercial properties) or certified residential appraisers (for residential properties) whose qualifications and licenses have been reviewed and verified by the Company. Once received, the Company reviews the assumptions and approaches utilized in the appraisal as well as the overall resulting fair value in comparison with independent data sources such as recent market data or industry-wide statistics. The following presents assets measured on a nonrecurring basis as of the dates noted (dollars in thousands): Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Assets Inputs Inputs Reported June 30, 2022 (Level 1) (Level 2) (Level 3) Balance OREO: Commercial properties $ — $ — $ 378 $ 378 Impaired loans (1) Commercial and Industrial $ — $ — $ 1,632 $ 1,632 Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Assets Inputs Inputs Reported December 31, 2021 (Level 1) (Level 2) (Level 3) Balance Impaired loans (1) Commercial and Industrial $ — $ — $ 439 $ 439 ______________________________________ (1) The sales comparison approach was utilized for estimating the fair value of non-recurring assets. In the second quarter of 2022, the Company recorded $0.4 million of OREO as a result of obtaining physical possession of a foreclosed property as partial consideration for amounts owed on an impaired loan. As of June 30, 2022, this OREO property had a carrying amount of $0.4 million. As of December 31, 2021, the Company did not own any OREO properties. As of June 30, 2022, total impaired loans measured for impairment using the fair value of the collateral for collateral dependent loans had carrying values of $1.9 million with valuation allowances of $0.3 million and were classified as Level 3. As of December 31, 2021, total impaired loans measured for impairment using the fair value of the collateral dependent loans had carrying values of $2.2 million with valuation allowances of $1.8 million and were classified as Level 3. Impaired loans accounted for specific reserves of $0.3 million and $1.8 million as of June 30, 2022 and December 31, 2021, respectively. The Company did not have any charge offs during the six months ended June 30, 2022 from the specific reserve. The Company charged off an immaterial amount during the year ended December 31, 2021 from the specific reserve. Level 3 Analysis The following presents a reconciliation for Level 3 instruments measured at fair value on a recurring basis as of the dates noted (dollars in thousands): Three Months Ended June 30, 2022 Corporate Bonds Loans Held at Fair Value FSC Guarantee Asset IRLC Equity Warrants Beginning balance $ 6,215 $ 6,380 $ — $ 206 $ 990 $ 402 Acquisitions — 18,352 — — 1,083 — Originations — — — — (2,063) — Gains/(losses) in net income, net — (155) — (32) 826 323 Transfer to held-to-maturity (6,215) — — — — — Settlements — (3,100) — — — — Ending balance $ — $ 21,477 $ — $ 174 $ 836 $ 725 Three Months Ended June 30, 2021 Corporate Bonds Loans Held at Fair Value FSC Guarantee Asset IRLC Equity Warrants Beginning balance $ — $ — $ (173) $ 188 $ 2,105 $ — Acquisitions — — — — 5,823 — Originations — — — 2 (5,981) — Gains/(losses) in net income, net — — 173 6 861 — Ending balance $ — $ — $ — $ 196 $ 2,808 $ — Six Months Ended June 30, 2022 Corporate Bonds Loans Held at Fair Value FSC Guarantee Asset IRLC Equity Warrants Beginning balance $ 2,113 $ — $ (9) $ 237 $ 1,473 $ 160 Acquisitions 4,000 24,732 9 — 2,697 242 Originations — — — — (3,417) — Gains/(losses) in net income, net — (155) — (63) 83 323 Unrealized gains, net 102 — — — — — Transfer to held-to-maturity (6,215) — — — — — Settlements — (3,100) — — — — Ending balance $ — $ 21,477 $ — $ 174 $ 836 $ 725 Six Months Ended June 30, 2021 Corporate Bonds Loans Held at Fair Value FSC Guarantee Asset IRLC Equity Warrants Beginning balance $ — $ — $ (89) $ 232 $ 9,841 $ — Acquisitions — — (173) 2 8,507 — Originations — — — — (12,997) — Gains/(losses) in net income, net — — 262 (38) (2,543) — Ending balance $ — $ — $ — $ 196 $ 2,808 $ — The following presents quantitative information about Level 3 assets measured on a recurring and nonrecurring basis as of the dates noted (dollars in thousands): Quantitative Information about Level 3 Fair Value Measurements as of June 30, 2022 Valuation Significant Range Fair Value Technique Unobservable Input (Weighted Average) Recurring fair value Loans held at fair value $ 21,477 Discounted cash flow Discount rate 4% to 19% (10%) Guarantee asset 174 Discounted cash flow Discount rate 4% (4%) IRLC, net 836 Best execution model Pull through 67% to 100% (94%) Equity warrants 725 Black-Scholes option pricing model Volatility 32.4% to 32.5% (32.5%) Nonrecurring fair value OREO: Commercial properties 378 Appraisal value Commission, cost to sell, closing costs 9% (9%) Impaired loans (1) Commercial and Industrial 1,632 Sales comparison, Market approach - guideline transaction method Management discount for asset/property type 10% (10%) Quantitative Information about Level 3 Fair Value Measurements as of December 31, 2021 Valuation Significant Range Fair Value Technique Unobservable Input (Weighted Average) Recurring fair value Corporate Bonds $ 2,113 Discounted cash flow Discount rate 7% (7%) FSC (9) Internal pricing model Market Differential -14bps to -2 bps Guarantee asset 237 Discounted cash flow Discount rate 3% (3%) IRLC, net 1,473 Best execution model Pull through 71% to 100% (88%) Equity warrants 160 Black-Scholes option pricing model Volatility 24% to 37% (32%) Nonrecurring fair value Impaired loans (1) Commercial and Industrial 439 Sales comparison, Market approach - guideline transaction method Management discount for asset/property type 17% - 45% (39%) ______________________________________ (1) Estimated Fair Value of Other Financial Instruments The following presents carrying amounts and estimated fair values for financial instruments not carried at fair value as of the dates noted (dollars in thousands): Carrying Fair Value Measurements Using: June 30, 2022 Amount Level 1 Level 2 Level 3 Assets: Cash and cash equivalents $ 171,606 $ 171,606 $ — $ — Held-to-maturity securities 87,029 236 75,699 8,807 Loans, net 2,132,037 — — 2,105,608 Accrued interest receivable 7,884 3 333 7,548 Liabilities: Deposits 2,169,998 2,022,624 — 148,933 Borrowings: FHLB borrowings – fixed rate 80,000 — 79,789 — Federal Reserve borrowings – fixed rate 7,223 — 7,223 — Subordinated notes – fixed-to-floating rate 32,553 — — 32,476 Accrued interest payable 304 38 — 266 Carrying Fair Value Measurements Using: December 31, 2021 Amount Level 1 Level 2 Level 3 Assets: Cash and cash equivalents $ 386,983 $ 386,983 $ — $ — Loans, net 1,935,405 — — 1,919,625 Accrued interest receivable 7,151 2 203 6,946 Liabilities: Deposits 2,205,703 2,035,212 — 172,240 Borrowings: FHLB borrowings – fixed rate 15,000 — 14,990 — Federal Reserve borrowings – fixed rate 23,629 — 23,629 — Subordinated notes – fixed-to-floating rate 39,031 — — 40,325 Accrued interest payable 355 87 — 268 The fair value estimates presented and discussed above are based on pertinent information available to management as of the dates specified. The estimated fair value amounts are based on the exit price notion set forth by ASU 2016-01. Although management is not aware of any factors that would significantly affect the estimated fair values, such amounts have not been comprehensively revalued for purposes of these condensed consolidated financial statements since the balance sheet dates. Therefore, current estimates of fair value may differ significantly from the amounts presented herein. The methods and assumptions, not previously presented, used to estimate fair values are described as follows. Cash and Cash Equivalents and Restricted Cash Held-to-maturity securities Loans, net Accrued Interest Receivable and Payable Deposits Fixed Rate Borrowings Fixed-to-Floating Rate Borrowings |
SEGMENT REPORTING
SEGMENT REPORTING | 6 Months Ended |
Jun. 30, 2022 | |
SEGMENT REPORTING | |
SEGMENT REPORTING | NOTE 15 - SEGMENT REPORTING The Company’s reportable segments consist of Wealth Management and Mortgage. The chief operating decision maker ("CODM") is the Chief Executive Officer. The measure of profit or loss used by the CODM to identify and measure the Company’s reportable segments is income before income tax. The Wealth Management segment consists of operations relative to the Company’s fully integrated wealth management products and services. Services provided include deposit, loan, insurance, and trust and investment management advisory products and services. The Mortgage segment consists of operations relative to the Company’s residential mortgage service offerings. Mortgage products and services are financial in nature for which premiums are recognized net of expenses, upon the sale of mortgage loans to third parties. The following presents the financial information for each segment that is specifically identifiable or based on allocations using internal methods as of or for the three and six months ended June 30, 2022 and 2021 (dollars in thousands): As of or for the three months ended June 30, 2022 Wealth Management Mortgage Consolidated Income Statement Total interest income $ 21,631 $ — $ 21,631 Total interest expense 1,493 — 1,493 Provision for loan losses 519 — 519 Net interest income, after provision for loan losses 19,619 — 19,619 Non-interest income 5,663 1,277 6,940 Total income before non-interest expense 25,282 1,277 26,559 Depreciation and amortization expense 522 12 534 Net (gain)/loss on assets held for sale (2) — (2) All other non-interest expense 17,836 2,215 20,051 Income before income taxes $ 6,926 $ (950) $ 5,976 Goodwill $ 30,400 $ — $ 30,400 Total assets 2,513,177 28,316 2,541,493 As of or for the three months ended June 30, 2021 Wealth Management Mortgage Consolidated Income Statement Total interest income $ 15,548 $ — $ 15,548 Total interest expense 1,325 — 1,325 Provision for loan losses 12 — 12 Net interest income, after provision for loan losses 14,211 — 14,211 Non-interest income 5,573 3,927 9,500 Total income before non-interest expense 19,784 3,927 23,711 Depreciation and amortization expense 262 13 275 All other non-interest expense 12,539 2,709 15,248 Income before income taxes $ 6,983 $ 1,205 $ 8,188 Goodwill $ 24,191 $ — $ 24,191 Total assets 1,956,393 52,911 2,009,304 As of or for the six months ended June 30, 2022 Wealth Management Mortgage Consolidated Income Statement Total interest income $ 41,296 $ — $ 41,296 Total interest expense 2,874 — 2,874 Provision for loan losses 729 — 729 Net interest income, after provision for loan losses 37,693 — 37,693 Non-interest income 11,745 3,795 15,540 Total income before non-interest expense 49,438 3,795 53,233 Depreciation and amortization expense 1,070 24 1,094 Net loss on assets held for sale (3) — (3) All other non-interest expense 34,434 4,416 38,850 Income before income taxes $ 13,937 $ (645) $ 13,292 Goodwill $ 30,400 $ — $ 30,400 Total assets 2,513,177 28,316 2,541,493 F As of or for the six months ended June 30, 2021 Wealth Management Mortgage Consolidated Income Statement Total interest income $ 30,047 $ — $ 30,047 Total interest expense 2,771 — 2,771 Provision for loan losses 12 — 12 Net interest income, after provision for loan losses 27,264 — 27,264 Non-interest income 10,978 9,124 20,102 Total income before non-interest expense 38,242 9,124 47,366 Depreciation and amortization expense 520 27 547 All other non-interest expense 24,822 5,770 30,592 Income before income taxes $ 12,900 $ 3,327 $ 16,227 Goodwill $ 24,191 $ — $ 24,191 Total assets 1,956,393 52,911 2,009,304 |
LOW-INCOME HOUSING TAX CREDIT I
LOW-INCOME HOUSING TAX CREDIT INVESTMENT | 6 Months Ended |
Jun. 30, 2022 | |
LOW-INCOME HOUSING TAX CREDIT INVESTMENTS | |
LOW-INCOME HOUSING TAX CREDIT INVESTMENTS | NOTE 16 – LOW-INCOME HOUSING TAX CREDIT INVESTMENTS On December 19, 2019, the Company invested in a low-income housing tax credit ("LIHTC") investment. As of June 30, 2022 and December 31, 2021, the balance of the LIHTC investment was $2.6 million. These balances are reflected in the Other assets line item of the Condensed Consolidated Balance Sheets. There were no unfunded commitments related to the LIHTC investment as of June 30, 2022. As of December 31, 2021, total unfunded commitments were $0.2 million. The Company uses the proportional amortization method to account for this investment. Amortization expense is included within the Income tax expense line item of the Condensed Consolidated Statements of Income. During the three months ended June 30, 2022 and 2021, the Company recognized amortization expense of $0.1 million. During the six months ended June 30, 2022 and 2021, the Company recognized amortization expense of $0.2 million. Additionally, during the three months ended June 30, 2022 and 2021, the Company recognized $0.1 million of tax credits and other benefits from the LIHTC investment. During the six months ended June 30, 2022 and 2021, the Company recognized $0.2 million of tax credits and other benefits. During the three and six months ended June 30, 2022 and 2021, the Company did not incur any impairment losses. |
REGULATORY CAPITAL MATTERS
REGULATORY CAPITAL MATTERS | 6 Months Ended |
Jun. 30, 2022 | |
REGULATORY CAPITAL MATTERS | |
REGULATORY CAPITAL MATTERS | NOTE 17 - REGULATORY CAPITAL MATTERS First Western and the Bank are subject to various regulatory capital adequacy requirements administered by federal 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 condensed consolidated financial statements. Under capital adequacy guidelines and, additionally for banks, the regulatory framework for prompt corrective action, First Western and the Bank must meet specific capital guidelines that involve quantitative measures of their assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices. First Western and the Bank’s capital amounts and classification are also subject to qualitative judgments by the regulators regarding components, risk weightings, and other factors. The final rules implementing Basel Committee on Banking Supervision’s capital guidelines for U.S. banks ("Basel III rules") have been fully phased in. The net unrealized gain or loss on available-for-sale securities is not included in computing regulatory capital. During the year ended December 31, 2021, First Western made a capital injection of $2.9 million into the Bank. Management believes as of June 30, 2022, First Western and the Bank meet all capital adequacy requirements to which they are subject. Prompt corrective action regulations for First Western and the Bank provide five classifications: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized, and critically undercapitalized, although these terms are not used to represent overall financial condition. If adequately capitalized, regulatory approval is required to accept brokered deposits. If undercapitalized, capital distributions are limited, as is asset growth and expansion, and capital restoration plans are required. The standard ratios established by First Western and the Bank’s primary regulators to measure capital require First Western and the Bank to maintain minimum amounts and ratios, set forth in the following table. These ratios are common equity Tier 1 capital ("CET1"), Tier 1 capital and total capital (as defined in the regulations) to risk-weighted assets (as defined), and Tier 1 capital (as defined) to average assets (as defined). The actual capital ratios of First Western and the Bank, along with the applicable regulatory capital requirements as of June 30, 2022, were calculated in accordance with the requirements of Basel III. The final rules of Basel III also established a “capital conservation buffer” of 2.5% above new regulatory minimum capital ratios, which are fully effective following minimum ratios: (i) a CET1 ratio of 7.0%; (ii) a Tier 1 capital ratio of 8.5%; and (iii) a total capital ratio of 10.5%. Banks are subject to limitations on paying dividends, engaging in share repurchases, and paying discretionary bonuses if its capital level falls below the buffer amount. These limitations establish a maximum percentage of eligible retained income that can be utilized for such activities. As of June 30, 2022 and December 31, 2021, the most recent filings with the FDIC categorized First Western and the Bank as well capitalized under the regulatory guidelines. To be categorized as well capitalized, an institution must maintain minimum CET1 risk-based, Tier 1 risk-based, total risk-based, and Tier 1 leverage ratios as set forth in the following table. Management believes there are no conditions or events since June 30, 2022, that have changed the categorization of First Western and the Bank as well capitalized. Management believes First Western and the Bank met all capital adequacy requirements to which it was subject as of June 30, 2022 and December 31, 2021. The following presents the actual and required capital amounts and ratios as of dates noted (dollars in thousands): To be Well Capitalized Under Prompt Required for Capital Corrective Action Actual Adequacy Purposes (1) Regulations June 30, 2022 Amount Ratio Amount Ratio Amount Ratio Tier 1 capital to risk-weighted assets Bank $ 214,993 10.99 % $ 117,361 6.0 % $ 156,482 8.0 % Consolidated 199,379 10.15 N/A N/A N/A N/A CET1 to risk-weighted assets Bank 214,993 10.99 88,021 4.5 127,141 6.5 Consolidated 199,379 10.15 N/A N/A N/A N/A Total capital to risk-weighted assets Bank 229,777 11.75 156,482 8.0 195,602 10.0 Consolidated 247,164 12.58 N/A N/A N/A N/A Tier 1 capital to average assets Bank 214,993 8.65 99,469 4.0 124,336 5.0 Consolidated 199,379 8.00 N/A N/A N/A N/A To be Well Capitalized Under Prompt Required for Capital Corrective Action Actual Adequacy Purposes (1) Regulations December 31, 2021 Amount Ratio Amount Ratio Amount Ratio Tier 1 capital to risk-weighted assets Bank $ 203,164 11.40 % $ 106,945 6.0 % $ 142,594 8.0 % Consolidated 188,777 10.54 N/A N/A N/A N/A CET1 to risk-weighted assets Bank 203,164 11.40 80,209 4.5 115,858 6.5 Consolidated 188,777 10.54 N/A N/A N/A N/A Total capital to risk-weighted assets Bank 217,215 12.19 142,594 8.0 178,242 10.0 Consolidated 242,388 13.54 N/A N/A N/A N/A Tier 1 capital to average assets Bank 203,164 10.05 80,887 4.0 101,108 5.0 Consolidated 188,777 9.31 N/A N/A N/A N/A ______________________________________ (1) |
ORGANIZATION AND SUMMARY OF S_2
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2022 | |
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Business and Basis of Presentation | Business and Basis of Presentation FWFI is a bank holding company with financial holding company status registered with the Board of Governors of the Federal Reserve System. FWFI wholly owns the following subsidiaries: First Western Trust Bank (the "Bank") and Ryder, Stilwell Inc. ("RSI"). The Bank wholly owns the following subsidiaries, which are therefore indirectly wholly-owned by FWFI: First Western Merger Corporation ("Merger Corp") and RRI, LLC ("RRI"). RSI and RRI are not active operating entities. The Company provides a fully-integrated suite of wealth management services including, private banking, personal trust, investment management, mortgage loans, and institutional asset management services to individual and corporate clients principally in Colorado (metro Denver, Aspen, Boulder, Fort Collins, and Vail Valley), Arizona (Phoenix and Scottsdale), California (Century City), Montana (Bozeman), and Wyoming (Jackson Hole, Laramie, Pinedale, and Rock Springs). The Company’s revenues are generated from its full range of product offerings as noted above, but principally from net interest income (the interest income earned on the Bank’s assets net of funding costs), fee-based wealth advisory, investment management, asset management and personal trust services, and net gains earned on mortgage loans. The condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission ("SEC"). Accordingly, they do not include all the information and footnotes required by GAAP for complete financial statements. The December 31, 2021 condensed consolidated balance sheet has been derived from the audited financial statements for the year ended December 31, 2021. In the opinion of management, all adjustments that were recurring in nature and considered necessary have been included for fair presentation of the Company’s financial position and results of operations. Operating results for the three and six months ended June 30, 2022 are not necessarily indicative of results that may be expected for the full year ending December 31, 2022. In preparing the condensed consolidated financial statements, the Company is required to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could be significantly different from those estimates. The condensed consolidated financial statements and notes should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 as filed with the SEC. |
Consolidation | Consolidation |
Business Combinations and Divestitures | Business Combinations and Divestitures |
Use of Estimates | Use of Estimates |
Concentration of Credit Risk | Concentration of Credit Risk |
Mortgage Banking Derivatives | Mortgage Banking Derivatives In order to manage the interest rate risk on our uncommitted IRLC and mortgage loans held for sale pipeline, the Company enters into mortgage derivative financial instruments called To Be Announced ("TBA"), which we refer to as forward commitments. TBA agreements are forward contracts to purchase mortgage backed securities ("MBS") that will be issued by a US Government Sponsored Enterprise. The Bank purchases or sells these derivatives to offset the changes in value of our mortgage loans held for sale and IRLC adjusted pipeline where we have exposure to interest rate volatility. Changes in the fair values of these derivatives are included in the Net gain on mortgage loans line of the Condensed Consolidated Statements of Income. |
Revenue Recognition | Revenue Recognition |
Transition of LIBOR to an Alternative Reference Rate | Transition of LIBOR to an Alternative Reference Rate In March 2020, the Financial Accounting Standards Board (‘FASB”) issued Accounting Standards Update (“ASU’) No. 2020-04 “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” These amendments provide temporary optional guidance to ease the potential burden in accounting for reference rate reform. The ASU provides optional expedients and exceptions for applying generally accepted accounting principles to contract modifications and hedging relationships, subject to meeting certain criteria, that reference the LIBOR or another reference rate expected to be discontinued. It is intended to help stakeholders during the global market-wide reference rate transition period. The guidance is effective for all entities as of March 12, 2020 through December 31, 2022. Subsequently, in January 2021, the FASB issued ASU No. 2021-01 “Reference Rate Reform (Topic 848): Scope.” This ASU clarifies that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. The ASU also amends the expedients and exceptions in Topic 848 to capture the incremental consequences of the scope clarification and to tailor the existing guidance to derivative instruments affected by the discounting transition. An entity may elect to apply ASU No. 2021-01 on contract modifications that change the interest rate used for margining, discounting, or contract price alignment retrospectively as of any date from the beginning of the interim period that includes March 12, 2020, or prospectively to new modifications from any date within the interim period that includes or is subsequent to January 7, 2021, up to the date that financial statements are available to be issued. An entity may elect to apply ASU No. 2021-01 to eligible hedging relationships existing as of the beginning of the interim period that includes March 12, 2020, and to new eligible hedging relationships entered into after the beginning of the interim period that includes March 12, 2020. Certain of the Company’s assets and liabilities are indexed to LIBOR, with exposure extending beyond December 31, 2021. The Company is currently evaluating and planning for the eventual replacement of the LIBOR benchmark interest rate, including the possibility of SOFR as the dominant replacement. In general, the transition away from LIBOR may result in increased market risk, credit risk, operational risk and business risk for the Company. The Company has developed a LIBOR transition plan, which addresses governance, risk management, legal, operational, systems, fallback language, and other aspects of planning. The company no longer originates LIBOR indexed loans and is working on transitioning existing LIBOR loans to SOFR. Consumer indexed loans are being managed in accordance with Interagency Guidance. |
COVID-19 and CARES Act | COVID-19 and CARES Act The CARES Act created the Paycheck Protection Program ("PPP"), which is administered by the Small Business Administration ("SBA"). The PPP is intended to provide loans to small businesses to pay their employees, rent, mortgage interest, and utilities. The loans may be forgiven conditioned upon the client providing payroll documentation evidencing their compliant use of funds and otherwise complying with the terms of the program. The Bank is an approved SBA lender and supported the community and clients by originating PPP loans since the program was created. PPP loans are classified in the Cash, Securities and Other portion of the loan portfolio. See Note 4 – Loans and the Allowance for Loan Losses for further discussion on our PPP loans. As a result of the COVID-19 pandemic, a loan modification program was designed and implemented to assist our clients experiencing financial stress resulting from the economic impacts caused by the global pandemic. The Company offered loan extensions, temporary payment moratoriums, and financial covenant waivers for commercial and consumer borrowers impacted by the pandemic and had a risk rating of “pass” and had not been delinquent in making interest or principal payment by more than 30 days during the last two years. The CARES Act provides banks optional, temporary relief from accounting for certain loan modifications as troubled debt restructurings ("TDR"). The modifications must be related to the adverse effects of COVID-19, and certain other criteria are required to be met in order to apply the relief. Interagency guidance from Federal Reserve and the Federal Deposit Insurance Corporation ("FDIC") confirmed with the FASB that short-term modifications made on a good faith basis in response to COVID-19 to borrowers who were current prior to any relief, are not to be considered a TDR. We believe our loan modification program meets that definition and have not classified any of these modifications as a TDR as of June 30, 2022. See Note 4 – Loans and the Allowance for Loan Losses for further discussion on our loan modification program. The Company is a participant in the Federal Reserve’s Main Street Lending Program ("MSLP") to support lending to small and medium-sized for profit businesses and nonprofit organizations that were in sound financial condition before the onset of the COVID-19 pandemic. The Company may sell a 95% participation in a new MSLP loan to the Main Street Special Purpose Vehicle ("SPV") at par value. The Company must retain 5% of the MSLP loan until (i) it matures or (ii) neither the Main Street SPV nor a Governmental Assignee holds an interest in MSLP Loan in any capacity, whichever comes first. See Note 4 – Loans and the Allowance for Loan Losses for further discussion on our participation in the program. |
Reclassifications | Reclassifications |
Recently adopted accounting pronouncements and Recently issued accounting pronouncements, not yet adopted | Recently adopted accounting pronouncements In January 2017, the FASB issued ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment Recently issued accounting pronouncements, not yet adopted In June 2022, the FASB issued ASU 2022-03, Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions. This was issued to clarify the guidance in Topic 820, Fair Value Measurement, when measuring fair value of an equity security subject to contractual restrictions that prohibit the sale of an equity security and to introduce new disclosure requirements for equity securities subject to contractual sale restrictions that are measured at fair value in accordance with Topic 820. The Company is currently assessing the impact of this guidance on our existing equity securities. This guidance is effective for the Company in fiscal years after December 15, 2023. In February 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326) ("ASU 2016-13"). ASU 2016-13 replaces the incurred loss model with an expected loss model, which is referred to as the current expected credit loss ("CECL") model. The CECL model is applicable to the measurement of credit losses on the financial assets measured at amortized cost, including loan receivables, held-to-maturity debt securities, and reinsurance receivables. It also applies to off-balance sheet credit exposures not accounted for as insurance (loan commitments, standby letters of credit, financial guarantees, and other similar instruments) and net investments in leases recognized by a lessor. For all other assets within the scope of CECL, a cumulative-effect adjustment will be recognized in retained earnings and the allowance for credit losses as of the beginning of the first reporting period in which the guidance is effective. ASU 2016-13 was set to be effective for most public companies on January 1, 2020. However, at the October 16, 2019 FASB meeting, the FASB voted unanimously to delay the effective date of CECL adoption for smaller reporting companies ("SRCs") to January 1, 2023. During the six months ended June 30, 2022, the Company’s CECL project team continued to work through its implementation plan. The Company has selected a champion quantitative model to approximate expected losses by call code segment using regional and other appropriate peers. The Company has selected qualitative factors and evaluated those factors for each loan segment for the quarter ended June 30, 2022. The Company has begun to document policies and procedures, internal control structure, and process flows. Using this information, the Company successfully ran parallel models for both the first and second quarters of 2022 in order for management to review and compare results between the initial CECL model and existing ALLL model. Currently, we are unable to estimate the impact the adoption of this update will have on the condensed consolidated financial statements and disclosures. However, the Company expects the impact of the adoption will be significantly influenced by the composition and characteristics of its loan portfolios along with economic conditions prevalent as of the date of adoption. The Company expects to implement the new standard beginning January 1, 2023. |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
ACQUISITIONS | |
Estimated fair value of assets acquired and liabilities assumed | The following presents the estimated fair values of the assets acquired and liabilities assumed in the transaction with Teton as of December 31, 2021, including all measurement period adjustments to the provisional estimates (dollars in thousands): Provisional Measurement Period December 31, Fair value of consideration transferred Estimates Adjustments 2021 Cash consideration $ 11,501 $ — $ 11,501 Common stock issued 39,818 — 39,818 Total fair value of consideration transferred 51,319 — 51,319 Assets acquired Cash and cash equivalents 132,498 — 132,498 Available-for-sale securities, at fair value 18,058 — 18,058 Correspondent bank stock, at cost 928 — 928 Mortgage loans held for sale 840 — 840 Loans 252,275 (857) 251,418 Premises and equipment 17,758 — 17,758 Accrued interest receivable 923 — 923 Accounts receivable 95 — 95 Other receivable 520 — 520 Core deposit intangible (1) 1,264 698 1,962 Other assets 226 242 468 Assets held for sale 115 5 120 Total assets acquired 425,500 88 425,588 Liabilities assumed Deposits 379,227 (29) 379,198 Accrued interest payable 26 — 26 Other liabilities 1,283 — 1,283 Deferred tax liabilities/(assets), net 42 (71) (29) Total liabilities assumed 380,578 (100) 380,478 Net assets acquired 44,922 188 45,110 Goodwill recognized $ 6,397 $ (188) $ 6,209 ________________________________ (1) The core deposit intangible was determined to have an estimated life of 10 years . |
Schedule of acquisition expenses within Non-interest expense | The following presents the acquisition expenses within Non-interest expense of the Condensed Consolidated Statements of Income as of the date noted (dollars in thousands): Three Months Ended Six Months Ended June 30, 2022 June 30, 2022 Mergers and acquisitions expense: Salaries and employee benefits $ 152 $ 381 Professional services 274 386 Technology and information systems 4 4 Data processing (1) (93) 22 Marketing 5 75 Other 5 6 Total mergers and acquisitions expense $ 347 $ 874 (1) |
Schedule of business acquisition, pro forma information | The following table presents pro forma information for the three and six months ended June 30, 2022 and 2021, as if the Teton Acquisition had occurred on January 1, 2021. This table has been prepared for comparative purposes only, and is not indicative of the actual results that would have been attained had the acquisitions occurred as of the beginning of the periods presented, nor is it indicative of future results (in thousands, except per share data): Pro Forma Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Net interest income after provision for loan losses $ 19,619 $ 16,755 $ 37,693 $ 33,211 Non-interest income 6,940 10,039 15,540 21,359 Net income 4,482 10,736 10,006 14,392 Pro forma earnings per share: Basic 0.47 1.15 1.06 1.54 Diluted 0.46 1.12 1.03 1.51 |
INVESTMENT SECURITIES (Tables)
INVESTMENT SECURITIES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
INVESTMENT SECURITIES | |
Schedule of the amortized cost and fair value of securities held to maturity, with gross unrecognized gains and losses | Gross Gross Amortized Unrecognized Unrecognized Fair June 30, 2022 Cost Gains Losses Value Investment securities held-to-maturity: U.S. Treasury debt $ 240 $ — $ (4) $ 236 U.S. Government Agency 252 — (2) 250 Corporate bonds 24,085 6 (651) 23,440 GNMA mortgage-backed securities – residential 43,583 — (1,089) 42,494 FNMA mortgage-backed securities – residential 7,184 — (333) 6,851 Government CMO and MBS - commercial 7,426 14 (249) 7,191 Corporate CMO and MBS 4,259 74 (53) 4,280 Total securities held-to-maturity $ 87,029 $ 94 $ (2,381) $ 84,742 |
Schedule of the amortized cost and fair value of securities available for sale, with gross unrealized gains and losses recognized | Gross Gross Amortized Unrealized Unrealized Fair December 31, 2021 Cost Gains Losses Value Investment securities available-for-sale: U.S. Treasury debt $ 250 $ — $ (3) $ 247 U.S. Government Agency 3,522 — — 3,522 Corporate bonds 8,113 227 (15) 8,325 GNMA mortgage-backed securities – residential 26,611 185 (146) 26,650 FNMA mortgage-backed securities – residential 14,400 43 — 14,443 Government CMO and MBS - commercial 878 — — 878 Corporate CMO and MBS 1,492 23 (18) 1,497 Total securities available-for-sale $ 55,266 $ 478 $ (182) $ 55,562 |
Summary of the amortized cost and estimated fair value of held to maturity securities | Amortized Fair June 30, 2022 Cost Value Due within one year $ 363 $ 361 Due between one year and five years 2,233 2,196 Due between five years and ten years 21,582 20,975 Due after ten years 399 394 Securities (CMO and MBS) 62,452 60,816 Total $ 87,029 $ 84,742 |
Schedule of unrealized loss on held to maturity and available for sale securities | The following presents securities with unrealized losses aggregated by major security type and length of time in a continuous unrealized loss position as of the dates noted (dollars in thousands, before tax): Less than 12 Months 12 Months or Longer Total Fair Unrealized Fair Unrealized Fair Unrealized June 30, 2022 Value Losses Value Losses Value Losses Investment securities held-to-maturity: U.S. Treasury debt $ 236 $ (14) $ — $ — $ 236 $ (14) U.S. Government Agency 250 (2) — — 250 (2) Corporate bonds 20,836 (689) 475 (26) 21,311 (715) GNMA mortgage-backed securities – residential 40,306 (2,131) 2,094 (248) 42,400 (2,379) FNMA mortgage-backed securities – residential 6,851 (760) — — 6,851 (760) Government CMO and MBS - commercial 6,304 (657) — — 6,304 (657) Corporate CMO and MBS 761 (36) 435 (43) 1,196 (79) Total $ 75,544 $ (4,289) $ 3,004 $ (317) $ 78,548 $ (4,606) Less than 12 Months 12 Months or Longer Total Fair Unrealized Fair Unrealized Fair Unrealized December 31, 2021 Value Losses Value Losses Value Losses Investment securities available-for-sale: U.S. Treasury debt $ 247 $ (3) $ — $ — $ 247 $ (3) Corporate bonds 485 (15) — — 485 (15) GNMA mortgage-backed securities – residential 17,205 (146) — — 17,205 (146) Corporate CMO and MBS — — 521 (18) 521 (18) Total $ 17,937 $ (164) $ 521 $ (18) $ 18,458 $ (182) |
LOANS AND THE ALLOWANCE FOR L_2
LOANS AND THE ALLOWANCE FOR LOAN LOSSES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
LOANS AND THE ALLOWANCE FOR LOAN LOSSES | |
Summary of the Company's loans | The following presents a summary of the Company’s loans as of the dates noted (dollars in thousands): June 30, December 31, 2022 2021 Cash, Securities and Other (1) $ 180,738 $ 261,190 Consumer and Other (2) 47,855 34,758 Construction and Development 162,426 178,716 1-4 Family Residential 732,725 580,872 Non-Owner Occupied CRE 489,111 482,622 Owner Occupied CRE 224,597 212,426 Commercial and Industrial (3) 312,696 203,584 Total loans held for investment 2,150,148 1,954,168 Deferred fees and unamortized premiums/(unaccreted discounts), net (4) (3,754) (5,031) Allowance for loan losses (14,357) (13,732) Loans, net $ 2,132,037 $ 1,935,405 ______________________________________ (1) 2022 and December 31, 2021, respectively. (2) (3) (4) |
Summary of aging analysis of the recorded investments in loans past due | The following presents, by class, an aging analysis of the recorded investments (excluding accrued interest receivable, deferred fees, and unamortized premiums/(unaccreted discounts), which are not material) in loans past due as of the dates noted (dollars in thousands): 30-59 60-89 90 or Total Total Days Days More Days Loans Recorded June 30, 2022 Past Due Past Due Past Due Past Due Current Investment Cash, Securities and Other $ 3,803 $ 149 $ 4 $ 3,956 $ 176,782 $ 180,738 Consumer and Other 36 35 8 79 47,776 47,855 Construction and Development — 805 — 805 161,621 162,426 1-4 Family Residential 9,705 — — 9,705 723,020 732,725 Non-Owner Occupied CRE — — — — 489,111 489,111 Owner Occupied CRE — 278 — 278 224,319 224,597 Commercial and Industrial 19,021 47 1,893 20,961 291,735 312,696 Total $ 32,565 $ 1,314 $ 1,905 $ 35,784 $ 2,114,364 $ 2,150,148 30-59 60-89 90 or Total Total Days Days More Days Loans Recorded December 31, 2021 Past Due Past Due Past Due Past Due Current Investment Cash, Securities and Other $ 745 $ — $ 6 $ 751 $ 260,439 $ 261,190 Consumer and Other 454 — 2 456 34,302 34,758 Construction and Development 2,758 — — 2,758 175,958 178,716 1-4 Family Residential 1,449 — — 1,449 579,423 580,872 Non-Owner Occupied CRE — 2,548 — 2,548 480,074 482,622 Owner Occupied CRE 1,419 — — 1,419 211,007 212,426 Commercial and Industrial 748 — 2,200 2,948 200,636 203,584 Total $ 7,573 $ 2,548 $ 2,208 $ 12,329 $ 1,941,839 $ 1,954,168 |
Schedule of recorded investment in non accrual loans by class | The following presents the recorded investment in non-accrual loans by class as of the dates noted (dollars in thousands): June 30, December 31, 2022 2021 Cash, Securities and Other $ 4 $ 6 Consumer and Other 2 2 1-4 Family Residential 68 75 Owner Occupied CRE 1,200 1,241 Commercial and Industrial 2,603 2,938 Total $ 3,877 $ 4,262 |
Summary of the unpaid principal balance of loans classified as TDRs | The following presents a summary of the unpaid principal balance of loans classified as TDRs as of the dates noted (dollars in thousands): June 30, December 31, 2022 2021 Accruing Non-Owner Occupied CRE $ 46 $ 55 Non-accrual Cash, Securities, and Other 4 6 1-4 Family Residential 68 75 Owner Occupied CRE 1,200 1,241 Commercial and Industrial 2,603 2,938 Total 3,921 4,315 Allowance for loan losses associated with TDR (261) (1,751) Net recorded investment $ 3,660 $ 2,564 |
Summary of impaired loans by portfolio and related valuation allowance | The following presents impaired loans by portfolio and related valuation allowance during the periods presented (dollars in thousands): June 30, 2022 December 31, 2021 Unpaid Allowance Unpaid Allowance Total Contractual for Total Contractual for Recorded Principal Loan Recorded Principal Loan Investment Balance Losses Investment Balance Losses Impaired loans with a valuation allowance: Consumer and Other $ 2 $ 2 $ 2 $ 2 $ 2 $ 2 Commercial and Industrial 1,893 1,893 261 2,190 2,190 1,751 Total $ 1,895 $ 1,895 $ 263 $ 2,192 $ 2,192 $ 1,753 Impaired loans with no related valuation allowance: Cash, Securities, and Other $ 4 $ 4 $ — $ 6 $ 6 $ — 1-4 Family Residential 68 68 — 75 75 — Owner Occupied CRE 1,200 1,200 — 1,241 1,241 — Commercial and Industrial 710 710 — 748 748 — Total $ 1,982 $ 1,982 $ — $ 2,070 $ 2,070 $ — Total impaired loans: Cash, Securities, and Other $ 4 $ 4 $ — $ 6 $ 6 $ — Consumer and Other 2 2 2 2 2 2 1-4 Family Residential 68 68 — 75 75 — Owner Occupied CRE 1,200 1,200 — 1,241 1,241 — Commercial and Industrial 2,603 2,603 261 2,938 2,938 1,751 Total $ 3,877 $ 3,877 $ 263 $ 4,262 $ 4,262 $ 1,753 The recorded investment in loans in the previous tables excludes accrued interest, deferred fees, and unamortized premiums/(unaccreted discounts), which are not material. Interest income, if any, was recognized on the cash basis on non-accrual loans. The following presents the average balance of impaired loans and interest income recognized on impaired loans during the periods presented (dollars in thousands): Three Months Ended June 30, 2022 2021 Average Interest Average Interest Recorded Income Recorded Income Investment Recognized Investment Recognized Impaired loans with a valuation allowance: Cash, Securities, and Other $ — $ — $ 2 $ — Consumer and Other 2 — 2 — Commercial and Industrial 2,041 — 3,230 21 Total $ 2,043 $ — $ 3,234 $ 21 Impaired loans with no related valuation allowance: Cash, Securities, and Other $ 4 $ — $ 15 $ — Owner Occupied CRE 1,211 — — 51 Commercial and Industrial 723 — 82 — 1-4 Family Residential 70 — — — Total $ 2,008 $ — $ 97 $ 51 Total impaired loans: Cash, Securities, and Other $ 4 $ — $ 17 $ — Consumer and Other 2 — 2 — Owner Occupied CRE 1,211 — — 51 Commercial and Industrial 2,764 — 3,312 21 1-4 Family Residential 70 — — — Total $ 4,051 $ — $ 3,331 $ 72 Six Months Ended June 30, 2022 2021 Average Interest Average Interest Recorded Income Recorded Income Investment Recognized Investment Recognized Impaired loans with a valuation allowance: Cash, Securities, and Other $ — $ — $ 1 $ — Consumer and Other 2 — 1 — Commercial and Industrial 2,089 — 2,162 21 Total $ 2,091 $ — $ 2,164 $ 21 Impaired loans with no related valuation allowance: Cash, Securities, and Other $ 4 $ — $ 20 $ — Owner Occupied CRE 1,221 — — 51 Commercial and Industrial 731 * 58 — 1-4 Family Residential 72 — — — Total $ 2,028 $ — $ 78 $ 51 Total impaired loans: Cash, Securities, and Other $ 4 $ — $ 21 $ — Consumer and Other 2 — 1 — Owner Occupied CRE 1,221 — — 51 Commercial and Industrial 2,820 * 2,220 21 1-4 Family Residential 72 — — — Total $ 4,119 $ — $ 2,242 $ 72 ______________________________________ * The Company recognized an immaterial amount of interest income during the period. |
Schedule of activity in the Company's allowance for loan losses by portfolio class | The following presents the activity in the Company’s allowance for loan losses by portfolio class during the periods presented (dollars in thousands): Cash, Consumer Construction 1-4 Non-Owner Owner Commercial Securities and and Family Occupied Occupied and and Other Other Development Residential CRE CRE Industrial Total Changes in allowance for loan losses for the three months ended June 30, 2022 Beginning balance $ 1,440 $ 283 $ 954 $ 3,789 $ 2,867 $ 1,328 $ 3,224 $ 13,885 (Release)/provision for loan losses (246) (16) 120 1,056 368 149 (912) 519 Charge-offs — (95) — — — — — (95) Recoveries — 48 — — — — — 48 Ending balance $ 1,194 $ 220 $ 1,074 $ 4,845 $ 3,235 $ 1,477 $ 2,312 $ 14,357 Changes in allowance for loan losses for the six months ended June 30, 2022 Beginning balance $ 1,598 $ 266 $ 1,092 $ 3,553 $ 2,952 $ 1,292 $ 2,979 $ 13,732 (Release)/provision for loan losses (404) 58 (18) 1,292 283 185 (667) 729 Charge-offs — (192) — — — — — (192) Recoveries — 88 — — — — — 88 Ending balance $ 1,194 $ 220 $ 1,074 $ 4,845 $ 3,235 $ 1,477 $ 2,312 $ 14,357 Allowance for loan losses as of June 30, 2022 allocated to loans evaluated for impairment: Individually $ — $ 2 $ — $ — $ — $ — $ 261 $ 263 Collectively 1,194 218 1,074 4,845 3,235 1,477 2,051 14,094 Ending balance $ 1,194 $ 220 $ 1,074 $ 4,845 $ 3,235 $ 1,477 $ 2,312 $ 14,357 Loans as of June 30, 2022: Individually evaluated for impairment $ 4 $ 2 $ — $ 68 $ — $ 1,200 $ 2,603 $ 3,877 Collectively evaluated for impairment 180,734 26,704 162,426 732,657 489,111 223,397 310,093 2,125,122 Measured at fair value — 21,149 — — — — — 21,149 Ending balance $ 180,738 $ 47,855 $ 162,426 $ 732,725 $ 489,111 $ 224,597 $ 312,696 $ 2,150,148 Cash, Consumer Construction 1-4 Non-Owner Owner Commercial Securities and and Family Occupied Occupied and and Other Other Development Residential CRE CRE Industrial Total Changes in allowance for loan losses for the three months ended June 30, 2021 Beginning balance $ 2,380 $ 193 $ 766 $ 3,152 $ 2,211 $ 1,123 $ 2,714 $ 12,539 (Release)/provision for loan losses (537) 2 105 247 12 102 81 12 Charge-offs — — — — — — — — Recoveries — 1 — — — — — 1 Ending balance $ 1,843 $ 196 $ 871 $ 3,399 $ 2,223 $ 1,225 $ 2,795 $ 12,552 Changes in allowance for loan losses for the six months ended June 30, 2021 Beginning balance $ 2,439 $ 140 $ 932 $ 3,233 $ 2,004 $ 1,159 $ 2,632 $ 12,539 (Release)/provision for loan losses (596) 55 (61) 166 219 66 163 12 Charge-offs — — — — — — — — Recoveries — 1 — — — — — 1 Ending balance $ 1,843 $ 196 $ 871 $ 3,399 $ 2,223 $ 1,225 $ 2,795 $ 12,552 Allowance for loan losses as of December 31, 2021 allocated to loans evaluated for impairment: Individually $ — $ 2 $ — $ — $ — $ — $ 1,751 $ 1,753 Collectively 1,598 264 1,092 3,553 2,952 1,292 1,228 11,979 Ending balance $ 1,598 $ 266 $ 1,092 $ 3,553 $ 2,952 $ 1,292 $ 2,979 $ 13,732 Loans as of December 31, 2021: Individually evaluated for impairment $ 6 $ 2 $ — $ 75 $ — $ 1,241 $ 2,938 $ 4,262 Collectively evaluated for impairment 261,184 34,756 178,716 580,797 482,622 211,185 200,646 1,949,906 Ending balance $ 261,190 $ 34,758 $ 178,716 $ 580,872 $ 482,622 $ 212,426 $ 203,584 $ 1,954,168 |
Summary of recorded investment in the Company's loans by class and by credit quality indicator | The following presents, by class and by credit quality indicator, the recorded investment in the Company’s loans as of the dates noted (dollars in thousands): Special June 30, 2022 Pass Mention Substandard Not Rated Total Cash, Securities and Other $ 180,734 $ — $ 4 $ — $ 180,738 Consumer and Other 26,704 — 2 21,149 47,855 Construction and Development 162,426 — — — 162,426 1-4 Family Residential 732,657 — 68 — 732,725 Non-Owner Occupied CRE 483,848 5,263 — — 489,111 Owner Occupied CRE 222,714 — 1,883 — 224,597 Commercial and Industrial 305,765 2,693 4,238 — 312,696 Total $ 2,114,848 $ 7,956 $ 6,195 $ 21,149 $ 2,150,148 Special December 31, 2021 Pass Mention Substandard Not Rated Total Cash, Securities and Other $ 261,184 $ — $ 6 $ — $ 261,190 Consumer and Other 34,756 — 2 — 34,758 Construction and Development 176,194 2,522 — — 178,716 1-4 Family Residential 580,797 — 75 — 580,872 Non-Owner Occupied CRE 476,670 5,952 — — 482,622 Owner Occupied CRE 210,493 — 1,933 — 212,426 Commercial and Industrial 198,368 401 4,815 — 203,584 Total $ 1,938,462 $ 8,875 $ 6,831 $ — $ 1,954,168 |
GOODWILL (Tables)
GOODWILL (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Goodwill. | |
Schedule of changes in carrying amount of goodwill | The following presents changes in the carrying amount of goodwill as of the dates noted (dollars in thousands): June 30, December 31, 2022 2021 Beginning balance $ 30,588 $ 24,191 Acquisition activity (188) 6,397 Ending balance $ 30,400 $ 30,588 |
LEASES (Tables)
LEASES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
LEASES | |
Lease Balance Sheet Location | The Company elected to not include short-term leases with initial terms of twelve months or less on the Condensed Consolidated Balance Sheets. The following presents the classification of the right-of-use assets and corresponding liabilities within the Condensed Consolidated Balance Sheets, as of the dates noted (dollars in thousands). June 30, December 31, 2022 2021 Lease Right-of-Use Assets Classification Operating lease right-of-use assets Other assets $ 9,431 $ 10,720 Lease Liabilities Classification Operating lease liabilities Other liabilities $ 12,325 $ 13,863 |
Schedule Of Weighted Average Lease Term And Discount Rate | June 30, December 31, 2022 2021 Weighted-Average Remaining Lease Term Operating leases 4.97 years 5.26 years Weighted-Average Discount Rate Operating leases 2.60 % 2.67 % |
Lease Costs | The following presents the Company’s net lease costs during the periods presented (dollars in thousands): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Lease Costs Operating lease cost $ 824 $ 731 $ 1,619 $ 1,483 Variable lease cost 528 416 1,086 828 Lease costs, net $ 1,352 $ 1,147 $ 2,705 $ 2,311 |
Schedule of Minimum Lease Payments Due | The following presents a maturity analysis of the Company’s operating lease liabilities on an annual basis for each of the next five years and total amounts thereafter (dollars in thousands): Year Ending December 31, Operating Leases 2022 (1) $ 1,755 2023 3,210 2024 3,064 2025 2,073 2026 703 Thereafter 2,168 Total future minimum lease payments 12,973 Less: imputed interest (648) Present value of net future minimum lease payments $ 12,325 ________________________________________ (1) |
Summary of maturity analysis of the Company's operating payments to be received | Undiscounted Year Ending December 31, Operating Lease Income 2022 (1) $ 134 2023 221 2024 199 2025 — 2026 — Thereafter — Total undiscounted operating lease income $ 554 ________________________________________ (1) |
DEPOSITS (Tables)
DEPOSITS (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
DEPOSITS | |
Schedule of interest bearing deposits | The following presents the Company’s interest-bearing deposits as of the dates noted (dollars in thousands): June 30, December 31, 2022 2021 Money market deposit accounts $ 1,033,739 $ 1,056,669 Time deposits 147,623 170,491 Negotiable order of withdrawal accounts 287,195 309,940 Savings accounts 33,099 32,299 Total interest-bearing deposits $ 1,501,656 $ 1,569,399 Aggregate time deposits of $250 or greater $ 70,492 $ 75,747 |
Schedule Of Time Deposit Maturities | The following presents the scheduled maturities of all time deposits for each of the next five years and total amounts thereafter (dollars in thousands): Year ending December 31, Time Deposits 2022 (1) $ 64,114 2023 46,252 2024 17,812 2025 3,029 2026 10,337 Thereafter 6,079 Total $ 147,623 ________________________________________ (1) |
BORROWINGS (Tables)
BORROWINGS (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
BORROWINGS | |
Schedule of borrowings from FHLB Topeka | The following presents the Company’s required maturities on FHLB borrowings as of the dates noted (dollars in thousands): June 30, December 31, Maturity Date Rate % 2022 2021 April 22, 2022 0.37 $ — $ 5,000 July 1, 2022 (1) 1.63 70,000 — May 5, 2023 0.76 10,000 10,000 Total $ 80,000 $ 15,000 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
COMMITMENTS AND CONTINGENCIES | |
Schedule of contract amounts represent credit risk | The following presents the Company’s financial instruments whose contract amounts represent credit risk, as of the dates noted (dollars in thousands): June 30, 2022 December 31, 2021 Fixed Rate Variable Rate Fixed Rate Variable Rate Unused lines of credit $ 128,605 $ 575,094 $ 136,289 $ 442,035 Standby letters of credit 6,263 22,035 2,420 20,940 Commitments to make loans to sell 37,841 — 60,529 — Commitments to make loans 52,056 17,749 16,256 14,920 |
SHAREHOLDERS EQUITY (Tables)
SHAREHOLDERS EQUITY (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
SHAREHOLDERS EQUITY | |
Schedule of summarizes activity for nonqualified stock options | The following presents activity for nonqualified stock options during the six months ended June 30, 2022: Weighted Weighted Average Number Average Remaining Aggregate of Exercise Contractual Intrinsic Options Price Term Value Outstanding as of December 31, 2021 308,574 $ 29.21 Granted — — Exercised (6,809) 21.47 Forfeited or expired (116,100) 40.00 Outstanding as of June 30, 2022 185,665 22.75 2.6 (1) Options fully vested / exercisable as of June 30, 2022 185,665 22.75 2.6 (1) ______________________________________ (1) |
Schedule of summarizes the activity for the Time Vesting Units, the Financial Performance Units and the Market Performance Units | Time Financial Market Vesting Performance Performance Units Units Units Outstanding as of December 31, 2021 249,821 183,483 13,746 Granted 126,004 64,629 — Vested (75,220) (12,100) — Forfeited (14,007) (12,086) (13,746) Outstanding as of June 30, 2022 286,598 223,926 — |
Schedule of financial performance units activity | The following presents the Company’s existing Financial Performance Units as of June 30, 2022 (dollars in thousands, except share amounts): Grant Period Threshold Accrual Maximum Issuable Shares at Current Threshold Unrecognized Compensation Expense Weighted-Average (1) Financial Metric End Date Vesting Requirement End Date May 1, 2019 through April 30, 2020 150% 76,797 $ 242 1.6 years December 31, 2021 December 31, 2023 May 1, 2020 through December 31, 2020, excluding November 18, 2020 150% 76,886 345 2.5 years December 31, 2022 December 31, 2023 On November 18, 2020 134% 29,212 278 2.4 years December 31, 2022 50% November 18, 2023 & 2025 May 3, 2021 through August 11, 2021 150% 56,148 735 3.5 years December 31, 2023 December 31, 2025 On May 2, 2022 79% 49,127 2,988 4.5 years December 31, 2024 December 31, 2026 ______________________________________ (1) The following presents the Company’s Financial Performance Units activity during the periods presented (dollars in thousands, except share amounts): Units Granted Compensation Expense Recognized Six Months Ended June 30, Three Months Ended June 30, Six Months Ended June 30, Grant Period 2022 2021 2022 2021 2022 2021 Prior to May 1, 2019 — — $ — 3 — $ 18 May 1, 2019 through April 30, 2020 — — 29 61 90 117 May 1, 2020 through December 31, 2020, excluding November 18, 2020 — — 29 54 82 109 On November 18, 2020 — (2) 30 28 64 May 3, 2021 through August 11, 2021 — 41,366 58 57 139 57 On May 2, 2022 64,629 — 58 — 58 — |
EARNINGS PER COMMON SHARE (Tabl
EARNINGS PER COMMON SHARE (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
EARNINGS PER COMMON SHARE | |
Schedule of basic and diluted earnings per share | The following presents the calculation of basic and diluted earnings per common share during the periods presented (dollars in thousands, except share and per share amounts): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Earnings per common share - Basic Numerator: Net income available for common shareholders $ 4,482 $ 6,277 $ 10,006 $ 12,276 Denominator: Basic weighted average shares 9,450,987 7,961,785 9,434,742 7,948,796 Earnings per common share - basic $ 0.47 $ 0.79 $ 1.06 $ 1.54 Earnings per common share - Diluted Numerator: Net income available for common shareholders $ 4,482 $ 6,277 $ 10,006 $ 12,276 Denominator: Basic weighted average shares 9,450,987 7,961,785 9,434,742 7,948,796 Diluted effect of common stock equivalents: Stock options 52,870 35,849 55,005 20,386 Time Vesting Units 122,090 131,684 155,813 117,107 Financial Performance Units 91,720 70,746 92,524 59,953 Market Performance Units — 13,836 6,827 14,017 Total diluted effect of common stock equivalents 266,680 252,115 310,169 211,463 Diluted weighted average shares 9,717,667 8,213,900 9,744,911 8,160,259 Earnings per common share - diluted $ 0.46 $ 0.76 $ 1.03 $ 1.50 |
Schedule of Antidilutive securities | Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Stock options — 141,639 — 209,874 Time Vesting Units 121,942 — 60,971 1,991 Financial Performance Units — 26,735 — 24,952 Restricted Stock Awards — — — 10,527 Total potentially dilutive securities 121,942 168,374 60,971 247,344 |
RELATED-PARTY TRANSACTIONS (Tab
RELATED-PARTY TRANSACTIONS (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
RELATED-PARTY TRANSACTIONS | |
Summary of related-party loan activity | The following presents a summary of related-party loan activity as of the dates noted (dollars in thousands): June 30, 2022 December 31, 2021 Balance, beginning of year $ 12,833 $ 14,321 Funded loans 12,880 11,294 Payments collected (7,102) (12,782) Balance, end of period $ 18,611 $ 12,833 |
FAIR VALUE (Tables)
FAIR VALUE (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
FAIR VALUE | |
Schedule of fair value assets and liabilities measured on recurring basis | The following presents assets and liabilities measured on a recurring basis as of the dates noted (dollars in thousands): Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Assets Inputs Inputs Reported June 30, 2022 (Level 1) (Level 2) (Level 3) Balance Mortgage loans held for sale $ — $ 26,202 $ — $ 26,202 Loans held at fair value $ — $ — $ 21,477 $ 21,477 Forward commitments and FSC $ — $ 239 $ — $ 239 Equity securities $ 655 $ 122 $ — $ 777 Guarantee asset $ — $ — $ 174 $ 174 IRLC, net $ — $ — $ 836 $ 836 Equity warrants $ — $ — $ 725 $ 725 Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Assets Inputs Inputs Reported December 31, 2021 (Level 1) (Level 2) (Level 3) Balance Investment securities available-for-sale: U.S. Treasury debt $ 247 $ — $ — $ 247 U.S. Government Agency — 3,522 — 3,522 Corporate bonds — 6,212 2,113 8,325 GNMA mortgage-backed securities - residential — 26,650 — 26,650 FNMA mortgage-backed securities - residential — 14,443 — 14,443 Government CMO and MBS — 878 — 878 Corporate CMO and MBS — 1,497 — 1,497 Total securities available-for-sale $ 247 $ 53,202 $ 2,113 $ 55,562 Mortgage loans held for sale $ — $ 30,620 $ — $ 30,620 Forward commitments and FSC $ — $ (65) $ (9) $ (74) Equity securities $ 709 $ 489 $ — $ 1,198 Guarantee asset $ — $ — $ 237 $ 237 IRLC, net $ — $ — $ 1,473 $ 1,473 Equity warrants $ — $ — $ 160 $ 160 |
Schedule of loans measured at fair value under fair value option | June 30, 2022 Total Loans Non Accruals 90 Days or More Past Due Fair Value Carrying Amount Unpaid Principal Balance Difference Fair Value Carrying Amount Unpaid Principal Balance Difference Fair Value Carrying Amount Unpaid Principal Balance Difference Loans held for sale $ 26,202 $ 25,858 $ 344 $ — $ — $ — $ — $ — $ — Loans held for investment 21,477 21,149 328 — — — — — — $ 47,679 $ 47,007 $ 672 $ — $ — $ — $ — $ — $ — December 31, 2021 Total Loans Non Accruals 90 Days or More Past Due Fair Value Carrying Amount Unpaid Principal Balance Difference Fair Value Carrying Amount Unpaid Principal Balance Difference Fair Value Carrying Amount Unpaid Principal Balance Difference Loans held for sale $ 30,620 $ 29,857 $ 763 $ — $ — $ — $ — $ — $ — Loans held for investment — — — — — — — — — $ 30,620 $ 29,857 $ 763 $ — $ — $ — $ — $ — $ — |
Schedule of gain or loss on fair value of loans | Three Months Ended Six Months Ended June 30, June 30, 2022 2021 2022 2021 Loans held for sale $ (394) $ 417 $ (419) $ (4,165) Loans held for investment 328 — 328 — $ (66) $ 417 $ (91) $ (4,165) |
Summary of activity pertaining to loans under fair value option | The following summarizes the activity pertaining to loans accounted for under the fair value option as of the dates noted (dollars in thousands): Three Months Ended Six Months Ended June 30, June 30, Loans held for sale 2022 2021 2022 2021 Balance at beginning of period $ 33,663 $ 176,644 $ 30,620 $ 161,843 Loans originated 278,720 365,423 470,494 901,777 Fair value changes (394) 417 (419) (4,165) Sales (285,777) (493,029) (474,443) (1,007,574) Settlements (10) (892) (50) (3,318) Balance at end of period $ 26,202 $ 48,563 $ 26,202 $ 48,563 Three Months Ended Six Months Ended June 30, June 30, Loans held for investment 2022 2021 2022 2021 Balance at beginning of period $ 6,380 $ — $ — $ — Loans acquired 17,869 — 24,249 — Fair value changes 328 — 328 — Settlements (3,100) — (3,100) — Balance at end of period $ 21,477 $ — $ 21,477 $ — |
Summary of assets measured at fair value on nonrecurring basis | The following presents assets measured on a nonrecurring basis as of the dates noted (dollars in thousands): Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Assets Inputs Inputs Reported June 30, 2022 (Level 1) (Level 2) (Level 3) Balance OREO: Commercial properties $ — $ — $ 378 $ 378 Impaired loans (1) Commercial and Industrial $ — $ — $ 1,632 $ 1,632 Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Assets Inputs Inputs Reported December 31, 2021 (Level 1) (Level 2) (Level 3) Balance Impaired loans (1) Commercial and Industrial $ — $ — $ 439 $ 439 ______________________________________ (1) |
Summary of assets and liability for level 3 instruments measured at fair value on recurring basis | The following presents a reconciliation for Level 3 instruments measured at fair value on a recurring basis as of the dates noted (dollars in thousands): Three Months Ended June 30, 2022 Corporate Bonds Loans Held at Fair Value FSC Guarantee Asset IRLC Equity Warrants Beginning balance $ 6,215 $ 6,380 $ — $ 206 $ 990 $ 402 Acquisitions — 18,352 — — 1,083 — Originations — — — — (2,063) — Gains/(losses) in net income, net — (155) — (32) 826 323 Transfer to held-to-maturity (6,215) — — — — — Settlements — (3,100) — — — — Ending balance $ — $ 21,477 $ — $ 174 $ 836 $ 725 Three Months Ended June 30, 2021 Corporate Bonds Loans Held at Fair Value FSC Guarantee Asset IRLC Equity Warrants Beginning balance $ — $ — $ (173) $ 188 $ 2,105 $ — Acquisitions — — — — 5,823 — Originations — — — 2 (5,981) — Gains/(losses) in net income, net — — 173 6 861 — Ending balance $ — $ — $ — $ 196 $ 2,808 $ — Six Months Ended June 30, 2022 Corporate Bonds Loans Held at Fair Value FSC Guarantee Asset IRLC Equity Warrants Beginning balance $ 2,113 $ — $ (9) $ 237 $ 1,473 $ 160 Acquisitions 4,000 24,732 9 — 2,697 242 Originations — — — — (3,417) — Gains/(losses) in net income, net — (155) — (63) 83 323 Unrealized gains, net 102 — — — — — Transfer to held-to-maturity (6,215) — — — — — Settlements — (3,100) — — — — Ending balance $ — $ 21,477 $ — $ 174 $ 836 $ 725 Six Months Ended June 30, 2021 Corporate Bonds Loans Held at Fair Value FSC Guarantee Asset IRLC Equity Warrants Beginning balance $ — $ — $ (89) $ 232 $ 9,841 $ — Acquisitions — — (173) 2 8,507 — Originations — — — — (12,997) — Gains/(losses) in net income, net — — 262 (38) (2,543) — Ending balance $ — $ — $ — $ 196 $ 2,808 $ — |
Summary of assets and liabilities measured at fair value on a recurring or nonrecurring, the significant unobservable inputs | The following presents quantitative information about Level 3 assets measured on a recurring and nonrecurring basis as of the dates noted (dollars in thousands): Quantitative Information about Level 3 Fair Value Measurements as of June 30, 2022 Valuation Significant Range Fair Value Technique Unobservable Input (Weighted Average) Recurring fair value Loans held at fair value $ 21,477 Discounted cash flow Discount rate 4% to 19% (10%) Guarantee asset 174 Discounted cash flow Discount rate 4% (4%) IRLC, net 836 Best execution model Pull through 67% to 100% (94%) Equity warrants 725 Black-Scholes option pricing model Volatility 32.4% to 32.5% (32.5%) Nonrecurring fair value OREO: Commercial properties 378 Appraisal value Commission, cost to sell, closing costs 9% (9%) Impaired loans (1) Commercial and Industrial 1,632 Sales comparison, Market approach - guideline transaction method Management discount for asset/property type 10% (10%) Quantitative Information about Level 3 Fair Value Measurements as of December 31, 2021 Valuation Significant Range Fair Value Technique Unobservable Input (Weighted Average) Recurring fair value Corporate Bonds $ 2,113 Discounted cash flow Discount rate 7% (7%) FSC (9) Internal pricing model Market Differential -14bps to -2 bps Guarantee asset 237 Discounted cash flow Discount rate 3% (3%) IRLC, net 1,473 Best execution model Pull through 71% to 100% (88%) Equity warrants 160 Black-Scholes option pricing model Volatility 24% to 37% (32%) Nonrecurring fair value Impaired loans (1) Commercial and Industrial 439 Sales comparison, Market approach - guideline transaction method Management discount for asset/property type 17% - 45% (39%) ______________________________________ (1) |
Summary of carrying amounts and estimated fair values of financial instruments | The following presents carrying amounts and estimated fair values for financial instruments not carried at fair value as of the dates noted (dollars in thousands): Carrying Fair Value Measurements Using: June 30, 2022 Amount Level 1 Level 2 Level 3 Assets: Cash and cash equivalents $ 171,606 $ 171,606 $ — $ — Held-to-maturity securities 87,029 236 75,699 8,807 Loans, net 2,132,037 — — 2,105,608 Accrued interest receivable 7,884 3 333 7,548 Liabilities: Deposits 2,169,998 2,022,624 — 148,933 Borrowings: FHLB borrowings – fixed rate 80,000 — 79,789 — Federal Reserve borrowings – fixed rate 7,223 — 7,223 — Subordinated notes – fixed-to-floating rate 32,553 — — 32,476 Accrued interest payable 304 38 — 266 Carrying Fair Value Measurements Using: December 31, 2021 Amount Level 1 Level 2 Level 3 Assets: Cash and cash equivalents $ 386,983 $ 386,983 $ — $ — Loans, net 1,935,405 — — 1,919,625 Accrued interest receivable 7,151 2 203 6,946 Liabilities: Deposits 2,205,703 2,035,212 — 172,240 Borrowings: FHLB borrowings – fixed rate 15,000 — 14,990 — Federal Reserve borrowings – fixed rate 23,629 — 23,629 — Subordinated notes – fixed-to-floating rate 39,031 — — 40,325 Accrued interest payable 355 87 — 268 |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
SEGMENT REPORTING | |
Schedule of segment data | The following presents the financial information for each segment that is specifically identifiable or based on allocations using internal methods as of or for the three and six months ended June 30, 2022 and 2021 (dollars in thousands): As of or for the three months ended June 30, 2022 Wealth Management Mortgage Consolidated Income Statement Total interest income $ 21,631 $ — $ 21,631 Total interest expense 1,493 — 1,493 Provision for loan losses 519 — 519 Net interest income, after provision for loan losses 19,619 — 19,619 Non-interest income 5,663 1,277 6,940 Total income before non-interest expense 25,282 1,277 26,559 Depreciation and amortization expense 522 12 534 Net (gain)/loss on assets held for sale (2) — (2) All other non-interest expense 17,836 2,215 20,051 Income before income taxes $ 6,926 $ (950) $ 5,976 Goodwill $ 30,400 $ — $ 30,400 Total assets 2,513,177 28,316 2,541,493 As of or for the three months ended June 30, 2021 Wealth Management Mortgage Consolidated Income Statement Total interest income $ 15,548 $ — $ 15,548 Total interest expense 1,325 — 1,325 Provision for loan losses 12 — 12 Net interest income, after provision for loan losses 14,211 — 14,211 Non-interest income 5,573 3,927 9,500 Total income before non-interest expense 19,784 3,927 23,711 Depreciation and amortization expense 262 13 275 All other non-interest expense 12,539 2,709 15,248 Income before income taxes $ 6,983 $ 1,205 $ 8,188 Goodwill $ 24,191 $ — $ 24,191 Total assets 1,956,393 52,911 2,009,304 As of or for the six months ended June 30, 2022 Wealth Management Mortgage Consolidated Income Statement Total interest income $ 41,296 $ — $ 41,296 Total interest expense 2,874 — 2,874 Provision for loan losses 729 — 729 Net interest income, after provision for loan losses 37,693 — 37,693 Non-interest income 11,745 3,795 15,540 Total income before non-interest expense 49,438 3,795 53,233 Depreciation and amortization expense 1,070 24 1,094 Net loss on assets held for sale (3) — (3) All other non-interest expense 34,434 4,416 38,850 Income before income taxes $ 13,937 $ (645) $ 13,292 Goodwill $ 30,400 $ — $ 30,400 Total assets 2,513,177 28,316 2,541,493 F As of or for the six months ended June 30, 2021 Wealth Management Mortgage Consolidated Income Statement Total interest income $ 30,047 $ — $ 30,047 Total interest expense 2,771 — 2,771 Provision for loan losses 12 — 12 Net interest income, after provision for loan losses 27,264 — 27,264 Non-interest income 10,978 9,124 20,102 Total income before non-interest expense 38,242 9,124 47,366 Depreciation and amortization expense 520 27 547 All other non-interest expense 24,822 5,770 30,592 Income before income taxes $ 12,900 $ 3,327 $ 16,227 Goodwill $ 24,191 $ — $ 24,191 Total assets 1,956,393 52,911 2,009,304 |
REGULATORY CAPITAL MATTERS (Tab
REGULATORY CAPITAL MATTERS (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
REGULATORY CAPITAL MATTERS | |
Schedule of actual and required capital ratios | The following presents the actual and required capital amounts and ratios as of dates noted (dollars in thousands): To be Well Capitalized Under Prompt Required for Capital Corrective Action Actual Adequacy Purposes (1) Regulations June 30, 2022 Amount Ratio Amount Ratio Amount Ratio Tier 1 capital to risk-weighted assets Bank $ 214,993 10.99 % $ 117,361 6.0 % $ 156,482 8.0 % Consolidated 199,379 10.15 N/A N/A N/A N/A CET1 to risk-weighted assets Bank 214,993 10.99 88,021 4.5 127,141 6.5 Consolidated 199,379 10.15 N/A N/A N/A N/A Total capital to risk-weighted assets Bank 229,777 11.75 156,482 8.0 195,602 10.0 Consolidated 247,164 12.58 N/A N/A N/A N/A Tier 1 capital to average assets Bank 214,993 8.65 99,469 4.0 124,336 5.0 Consolidated 199,379 8.00 N/A N/A N/A N/A To be Well Capitalized Under Prompt Required for Capital Corrective Action Actual Adequacy Purposes (1) Regulations December 31, 2021 Amount Ratio Amount Ratio Amount Ratio Tier 1 capital to risk-weighted assets Bank $ 203,164 11.40 % $ 106,945 6.0 % $ 142,594 8.0 % Consolidated 188,777 10.54 N/A N/A N/A N/A CET1 to risk-weighted assets Bank 203,164 11.40 80,209 4.5 115,858 6.5 Consolidated 188,777 10.54 N/A N/A N/A N/A Total capital to risk-weighted assets Bank 217,215 12.19 142,594 8.0 178,242 10.0 Consolidated 242,388 13.54 N/A N/A N/A N/A Tier 1 capital to average assets Bank 203,164 10.05 80,887 4.0 101,108 5.0 Consolidated 188,777 9.31 N/A N/A N/A N/A ______________________________________ (1) |
ORGANIZATION AND SUMMARY OF S_3
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Concentration of Credit Risk (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Collateral concentration risk | Loan portfolio | Real estate | ||
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Concentration risk (as a percent) | 75.50% | 76.10% |
Teton Financial Services | ||
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Total assets acquired | $ 425,588 |
ACQUISITIONS - Narrative (Detai
ACQUISITIONS - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2022 | Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2020 | |
Business Acquisition [Line Items] | |||||
Goodwill | $ 30,400 | $ 30,400 | $ 30,588 | $ 24,191 | $ 24,191 |
Acquisition cost | $ 347 | $ 874 | |||
Teton Financial Services | |||||
Business Acquisition [Line Items] | |||||
Purchase consideration | 51,319 | ||||
Goodwill | $ 6,209 |
ACQUISITIONS - Fair Value (Deta
ACQUISITIONS - Fair Value (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2022 | Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2020 | |
Liabilities assumed | |||||
Goodwill recognized | $ 30,400 | $ 30,400 | $ 30,588 | $ 24,191 | $ 24,191 |
Total loans held for investment | 2,150,148 | 2,150,148 | 1,954,168 | ||
Acquisition cost | 347 | 874 | |||
Cash, Securities and Other | |||||
Liabilities assumed | |||||
Total loans held for investment | 180,738 | 180,738 | 261,190 | ||
Construction and Development | |||||
Liabilities assumed | |||||
Total loans held for investment | 162,426 | 162,426 | 178,716 | ||
1-4 Family Residential | |||||
Liabilities assumed | |||||
Total loans held for investment | 732,725 | 732,725 | 580,872 | ||
Non-Owner Occupied CRE | |||||
Liabilities assumed | |||||
Total loans held for investment | 489,111 | 489,111 | 482,622 | ||
Owner Occupied CRE | |||||
Liabilities assumed | |||||
Total loans held for investment | 224,597 | 224,597 | 212,426 | ||
Commercial. and Industrial. | |||||
Liabilities assumed | |||||
Total loans held for investment | 312,696 | 312,696 | 203,584 | ||
PPP Loans | |||||
Liabilities assumed | |||||
Total loans held for investment | 10,700 | 10,700 | 46,800 | ||
Simmons Bank | |||||
Liabilities assumed | |||||
Total loans held for investment | $ 287,600 | $ 287,600 | 356,700 | ||
Teton Financial Services | |||||
Business Acquisition [Line Items] | |||||
Cash consideration | 11,501 | ||||
Common stock issued | 39,818 | ||||
Total fair value of consideration transferred | 51,319 | ||||
Assets acquired | |||||
Cash and cash equivalents | 132,498 | ||||
Available-for-sale securities, at fair value | 18,058 | ||||
Correspondant bank stock, at cost | 928 | ||||
Mortgage loans held for sale | 840 | ||||
Loans | 251,418 | ||||
Premises and equipment | 17,758 | ||||
Accrued interest receivable | 923 | ||||
Accounts receivable | 95 | ||||
Other receivable | 520 | ||||
Core deposit intangible | 1,962 | ||||
Other assets | 468 | ||||
Assets held for sale | 120 | ||||
Total assets acquired | 425,588 | ||||
Liabilities assumed | |||||
Deposits | 379,198 | ||||
Accrued interest payable | 26 | ||||
Other liabilities | 1,283 | ||||
Deferred tax liabilities/(assets), net | (29) | ||||
Total liabilities assumed | 380,478 | ||||
Net assets acquired | 45,110 | ||||
Goodwill recognized | 6,209 | ||||
Teton Financial Services | Provisional Estimates | |||||
Business Acquisition [Line Items] | |||||
Cash consideration | 11,501 | ||||
Common stock issued | 39,818 | ||||
Total fair value of consideration transferred | 51,319 | ||||
Assets acquired | |||||
Cash and cash equivalents | 132,498 | ||||
Available-for-sale securities, at fair value | 18,058 | ||||
Correspondant bank stock, at cost | 928 | ||||
Mortgage loans held for sale | 840 | ||||
Loans | 252,275 | ||||
Premises and equipment | 17,758 | ||||
Accrued interest receivable | 923 | ||||
Accounts receivable | 95 | ||||
Other receivable | 520 | ||||
Core deposit intangible | 1,264 | ||||
Other assets | 226 | ||||
Assets held for sale | 115 | ||||
Total assets acquired | 425,500 | ||||
Liabilities assumed | |||||
Deposits | 379,227 | ||||
Accrued interest payable | 26 | ||||
Other liabilities | 1,283 | ||||
Deferred tax liabilities/(assets), net | 42 | ||||
Total liabilities assumed | 380,578 | ||||
Net assets acquired | 44,922 | ||||
Goodwill recognized | 6,397 | ||||
Teton Financial Services | Measurement Period Adjustments | |||||
Assets acquired | |||||
Loans | (857) | ||||
Core deposit intangible | 698 | ||||
Other assets | 242 | ||||
Assets held for sale | 5 | ||||
Total assets acquired | 88 | ||||
Liabilities assumed | |||||
Deposits | (29) | ||||
Deferred tax liabilities/(assets), net | (71) | ||||
Total liabilities assumed | (100) | ||||
Net assets acquired | 188 | ||||
Goodwill recognized | $ (188) | ||||
Core deposit | |||||
Liabilities assumed | |||||
Estimated life | 10 years |
ACQUISITIONS - Acquisition expe
ACQUISITIONS - Acquisition expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2022 | Jun. 30, 2022 | |
Business Acquisition [Line Items] | ||
Total mergers and acquisitions expense | $ 347 | $ 874 |
Salaries and employee benefits | ||
Business Acquisition [Line Items] | ||
Total mergers and acquisitions expense | 152 | 381 |
Professional services | ||
Business Acquisition [Line Items] | ||
Total mergers and acquisitions expense | 274 | 386 |
Technology and information systems | ||
Business Acquisition [Line Items] | ||
Total mergers and acquisitions expense | 4 | 4 |
Data processing | ||
Business Acquisition [Line Items] | ||
Total mergers and acquisitions expense | (93) | 22 |
Marketing | ||
Business Acquisition [Line Items] | ||
Total mergers and acquisitions expense | 5 | 75 |
Other. | ||
Business Acquisition [Line Items] | ||
Total mergers and acquisitions expense | $ 5 | $ 6 |
ACQUISITIONS - Pro forma inform
ACQUISITIONS - Pro forma information (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
ACQUISITIONS | ||||
Net interest income after provision for loan losses | $ 19,619 | $ 16,755 | $ 37,693 | $ 33,211 |
Noninterest income | 6,940 | 10,039 | 15,540 | 21,359 |
Net income | $ 4,482 | $ 10,736 | $ 10,006 | $ 14,392 |
Pro forma earnings per share, Basic | $ 0.47 | $ 1.15 | $ 1.06 | $ 1.54 |
Pro forma earnings per share, Diluted | $ 0.46 | $ 1.12 | $ 1.03 | $ 1.51 |
INVESTMENT SECURITIES - Amortiz
INVESTMENT SECURITIES - Amortized cost and fair value of securities available-for-sale and held-to-maturity (Details) - USD ($) $ in Thousands | 1 Months Ended | 6 Months Ended | 12 Months Ended | |
Apr. 30, 2022 | Jun. 30, 2022 | Dec. 31, 2021 | Mar. 31, 2022 | |
Debt Securities, Available-for-sale And Held-to-maturity [Line Items] | ||||
Securities held-to-maturity, Gross Unrecognized Gains | $ 94 | |||
Securities held-to-maturity, Gross unrecognized losses | (2,381) | |||
Securities held-to-maturity, Fair Value | 84,742 | |||
Securities held-to-maturity, Amortized Cost | 87,029 | |||
Securities available-for-sale, Fair Value | $ 55,562 | |||
Securities available-for-sale, Gross Unrealized Losses | (182) | |||
Securities available-for-sale, Gross Unrealized Gains | 478 | |||
Securities available-for-sale, Amortized Cost | 55,266 | |||
Transfer of securities from available-for-sale to held-to-maturity | $ 58,700 | 58,727 | ||
Unrealized loss on transfer of securities from available-for-sale to held-to-maturity | 2,300 | |||
Unrealized Loss On Investments And Debt | 4,600 | |||
Unrealized loss | 182 | |||
Gain (loss) recognized at the time of transfer | $ 0 | |||
U.S. Treasury debt | ||||
Debt Securities, Available-for-sale And Held-to-maturity [Line Items] | ||||
Securities held-to-maturity, Gross unrecognized losses | (4) | |||
Securities held-to-maturity, Fair Value | 236 | |||
Securities held-to-maturity, Amortized Cost | 240 | |||
Securities available-for-sale, Fair Value | 247 | |||
Securities available-for-sale, Gross Unrealized Losses | (3) | |||
Securities available-for-sale, Amortized Cost | 250 | |||
Unrealized loss | 3 | |||
U.S. Government Agency | ||||
Debt Securities, Available-for-sale And Held-to-maturity [Line Items] | ||||
Securities held-to-maturity, Gross unrecognized losses | (2) | |||
Securities held-to-maturity, Fair Value | 250 | |||
Securities held-to-maturity, Amortized Cost | 252 | |||
Securities available-for-sale, Fair Value | 3,522 | |||
Securities available-for-sale, Amortized Cost | 3,522 | |||
Corporate bonds | ||||
Debt Securities, Available-for-sale And Held-to-maturity [Line Items] | ||||
Securities held-to-maturity, Gross Unrecognized Gains | 6 | |||
Securities held-to-maturity, Gross unrecognized losses | (651) | |||
Securities held-to-maturity, Fair Value | 23,440 | |||
Securities held-to-maturity, Amortized Cost | 24,085 | |||
Securities available-for-sale, Fair Value | 8,325 | |||
Securities available-for-sale, Gross Unrealized Losses | (15) | |||
Securities available-for-sale, Gross Unrealized Gains | 227 | |||
Securities available-for-sale, Amortized Cost | 8,113 | |||
Unrealized loss | 15 | |||
Government National Mortgage Association ("GNMA") mortgage-backed securities - residential | ||||
Debt Securities, Available-for-sale And Held-to-maturity [Line Items] | ||||
Securities held-to-maturity, Gross unrecognized losses | (1,089) | |||
Securities held-to-maturity, Fair Value | 42,494 | |||
Securities held-to-maturity, Amortized Cost | 43,583 | |||
Securities available-for-sale, Fair Value | 26,650 | |||
Securities available-for-sale, Gross Unrealized Losses | (146) | |||
Securities available-for-sale, Gross Unrealized Gains | 185 | |||
Securities available-for-sale, Amortized Cost | 26,611 | |||
Unrealized loss | 146 | |||
Federal National Mortgage Association ("FNMA") mortgage-backed securities - residential | ||||
Debt Securities, Available-for-sale And Held-to-maturity [Line Items] | ||||
Securities held-to-maturity, Gross unrecognized losses | (333) | |||
Securities held-to-maturity, Fair Value | 6,851 | |||
Securities held-to-maturity, Amortized Cost | 7,184 | |||
Securities available-for-sale, Fair Value | 14,443 | |||
Securities available-for-sale, Gross Unrealized Gains | 43 | |||
Securities available-for-sale, Amortized Cost | 14,400 | |||
Government CMO and MBS | ||||
Debt Securities, Available-for-sale And Held-to-maturity [Line Items] | ||||
Securities held-to-maturity, Gross Unrecognized Gains | 14 | |||
Securities held-to-maturity, Gross unrecognized losses | (249) | |||
Securities held-to-maturity, Fair Value | 7,191 | |||
Securities held-to-maturity, Amortized Cost | 7,426 | |||
Securities available-for-sale, Fair Value | 878 | |||
Securities available-for-sale, Amortized Cost | 878 | |||
Corporate CMO and MBS | ||||
Debt Securities, Available-for-sale And Held-to-maturity [Line Items] | ||||
Securities held-to-maturity, Gross Unrecognized Gains | 74 | |||
Securities held-to-maturity, Gross unrecognized losses | (53) | |||
Securities held-to-maturity, Fair Value | 4,280 | |||
Securities held-to-maturity, Amortized Cost | 4,259 | |||
Securities available-for-sale, Fair Value | 1,497 | |||
Securities available-for-sale, Gross Unrealized Losses | (18) | |||
Securities available-for-sale, Gross Unrealized Gains | 23 | |||
Securities available-for-sale, Amortized Cost | 1,492 | |||
Unrealized loss | 18 | |||
Bank Technology Fund [Member] | ||||
Debt Securities, Available-for-sale And Held-to-maturity [Line Items] | ||||
Payments To Partnership Fund | 500 | |||
Investment balance included in other assets | 500 | |||
Contractual Obligation | $ 3,000 | |||
Potential Future Contribution Obligation | 2,500 | |||
Small Business Investment Company ("SBIC") | ||||
Debt Securities, Available-for-sale And Held-to-maturity [Line Items] | ||||
Contractual Obligation | 1,000 | |||
Return of capital, received | 100 | 100 | ||
Other Assets [Member] | Small Business Investment Company ("SBIC") | ||||
Debt Securities, Available-for-sale And Held-to-maturity [Line Items] | ||||
Investment balance included in other assets | $ 2,000 | $ 2,000 |
INVESTMENT SECURITIES - Amort_2
INVESTMENT SECURITIES - Amortized cost and estimated fair value of held-to-maturity securities excluding SBIC (Details) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 USD ($) security | Dec. 31, 2021 USD ($) security | |
Debt Securities, Available-for-sale And Held-to-maturity [Line Items] | ||
Due within one year amortized cost | $ 363 | |
Due between one year and five years amortized cost | 2,233 | |
Due between five years and ten years amortized cost | 21,582 | |
Due after ten years, amortized cost | 399 | |
Securities (CMO and MBS), amortized cost | 62,452 | |
Securities held-to-maturity, Amortized Cost | 87,029 | |
Due within one year fair value | 361 | |
Due between one year and five years fair value | 2,196 | |
Due between five years and ten years fair value | 20,975 | |
Due after ten years, fair value | 394 | |
Securities (CMO and MBS), fair value | 60,816 | |
Fair Value | 84,742 | |
Held to maturity securities pledged as collateral | $ 17,100 | |
Debt available for sale securities pledged as collateral | $ 17,300 | |
Threshold Percentage Of Shareholders Equity Amount Held As Securities By One Issuer | 10% | 10% |
Unrealized loss | $ 2,381 | |
Available for sale securities, excluding SBIC | ||
Debt Securities, Available-for-sale And Held-to-maturity [Line Items] | ||
Number of securities in unrealized loss position | security | 97 | |
Number of securities in continuous unrealized loss position for more than twelve months | security | 3 | |
Securities Held To Maturity [Member] | ||
Debt Securities, Available-for-sale And Held-to-maturity [Line Items] | ||
Number of securities in unrealized loss position | security | 10 |
INVESTMENT SECURITIES - Securit
INVESTMENT SECURITIES - Securities with unrealized losses (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Debt Securities, Available-for-sale And Held-to-maturity [Line Items] | ||
Held to maturity, Less than 12 months, Fair Value | $ 75,544 | |
Held to maturity, Less than 12 months, Unrealized losses | (4,289) | |
Held to maturity, 12 months or Longer, Unrealized losses | (317) | |
Held to maturity, 12 months or Longer, Fair Value | 3,004 | |
Held to maturity, Total fair value | 78,548 | |
Held to maturity, Total unrealized losses | (4,606) | |
Less than 12 months, Fair Value | $ 17,937 | |
Less than 12 months, Unrealized Losses | (164) | |
12 months or Longer, Fair Value | 521 | |
12 months or Longer, Unrealized Losses | (18) | |
Total Fair Value | 18,458 | |
Total Unrealized Losses | (182) | |
U.S. Treasury debt | ||
Debt Securities, Available-for-sale And Held-to-maturity [Line Items] | ||
Held to maturity, Less than 12 months, Fair Value | 236 | |
Held to maturity, Less than 12 months, Unrealized losses | (14) | |
Held to maturity, Total fair value | 236 | |
Held to maturity, Total unrealized losses | (14) | |
Less than 12 months, Fair Value | 247 | |
Less than 12 months, Unrealized Losses | (3) | |
Total Fair Value | 247 | |
Total Unrealized Losses | (3) | |
U.S. Government Agency | ||
Debt Securities, Available-for-sale And Held-to-maturity [Line Items] | ||
Held to maturity, Less than 12 months, Fair Value | 250 | |
Held to maturity, Less than 12 months, Unrealized losses | (2) | |
Held to maturity, Total fair value | 250 | |
Held to maturity, Total unrealized losses | (2) | |
Corporate bonds | ||
Debt Securities, Available-for-sale And Held-to-maturity [Line Items] | ||
Held to maturity, Less than 12 months, Fair Value | 20,836 | |
Held to maturity, Less than 12 months, Unrealized losses | (689) | |
Held to maturity, 12 months or Longer, Unrealized losses | (26) | |
Held to maturity, 12 months or Longer, Fair Value | 475 | |
Held to maturity, Total fair value | 21,311 | |
Held to maturity, Total unrealized losses | (715) | |
Less than 12 months, Fair Value | 485 | |
Less than 12 months, Unrealized Losses | (15) | |
Total Fair Value | 485 | |
Total Unrealized Losses | (15) | |
Government National Mortgage Association ("GNMA") mortgage-backed securities - residential | ||
Debt Securities, Available-for-sale And Held-to-maturity [Line Items] | ||
Held to maturity, Less than 12 months, Fair Value | 40,306 | |
Held to maturity, Less than 12 months, Unrealized losses | (2,131) | |
Held to maturity, 12 months or Longer, Unrealized losses | (248) | |
Held to maturity, 12 months or Longer, Fair Value | 2,094 | |
Held to maturity, Total fair value | 42,400 | |
Held to maturity, Total unrealized losses | (2,379) | |
Less than 12 months, Fair Value | 17,205 | |
Less than 12 months, Unrealized Losses | (146) | |
Total Fair Value | 17,205 | |
Total Unrealized Losses | (146) | |
Federal National Mortgage Association ("FNMA") mortgage-backed securities - residential | ||
Debt Securities, Available-for-sale And Held-to-maturity [Line Items] | ||
Held to maturity, Less than 12 months, Fair Value | 6,851 | |
Held to maturity, Less than 12 months, Unrealized losses | (760) | |
Held to maturity, Total fair value | 6,851 | |
Held to maturity, Total unrealized losses | (760) | |
Government CMO and MBS | ||
Debt Securities, Available-for-sale And Held-to-maturity [Line Items] | ||
Held to maturity, Less than 12 months, Fair Value | 6,304 | |
Held to maturity, Less than 12 months, Unrealized losses | (657) | |
Held to maturity, Total fair value | 6,304 | |
Held to maturity, Total unrealized losses | (657) | |
Corporate CMO and MBS | ||
Debt Securities, Available-for-sale And Held-to-maturity [Line Items] | ||
Held to maturity, Less than 12 months, Fair Value | 761 | |
Held to maturity, Less than 12 months, Unrealized losses | (36) | |
Held to maturity, 12 months or Longer, Unrealized losses | (43) | |
Held to maturity, 12 months or Longer, Fair Value | 435 | |
Held to maturity, Total fair value | 1,196 | |
Held to maturity, Total unrealized losses | $ (79) | |
12 months or Longer, Fair Value | 521 | |
12 months or Longer, Unrealized Losses | (18) | |
Total Fair Value | 521 | |
Total Unrealized Losses | $ (18) |
LOANS AND THE ALLOWANCE FOR L_3
LOANS AND THE ALLOWANCE FOR LOAN LOSSES - Summary of loans (Details) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 USD ($) loan | Dec. 31, 2021 USD ($) loan | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total loans held for investment | $ 2,150,148 | $ 1,954,168 |
Deferred fees and unamortized premiums/(unaccreted discounts), net | (3,754) | (5,031) |
Allowance for loan losses | (14,357) | (13,732) |
Loans, net | 2,132,037 | 1,935,405 |
Loan measured at fair value | 21,477 | 0 |
Simmons Bank | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total loans held for investment | 287,600 | 356,700 |
Cash, Securities and Other | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Loan measured at fair value | 21,100 | 0 |
Cash, Securities and Other | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total loans held for investment | 180,738 | 261,190 |
Loan measured at fair value | 21,100 | |
Consumer and Other | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total loans held for investment | 47,855 | 34,758 |
Construction and Development | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total loans held for investment | 162,426 | 178,716 |
1-4 Family Residential | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total loans held for investment | 732,725 | 580,872 |
Non-Owner Occupied CRE | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total loans held for investment | 489,111 | 482,622 |
Owner Occupied CRE | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total loans held for investment | 224,597 | 212,426 |
Commercial. and Industrial. | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total loans held for investment | 312,696 | 203,584 |
PPP Loans | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total loans held for investment | 10,700 | 46,800 |
PPP Loans | Cash, Securities and Other | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total loans held for investment | $ 10,700 | $ 46,800 |
Percent of Loans on Total Loan Segment | 5.90% | 17.90% |
MSLP loan | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total loans held for investment | $ 6,800 | |
COVID-19 | MSLP loan | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Loans, net | $ 6,800 | $ 6,800 |
Percent of Loans on Total Loan Segment | 2.20% | 3.30% |
Number of loans | loan | 5 | 5 |
LOANS AND THE ALLOWANCE FOR L_4
LOANS AND THE ALLOWANCE FOR LOAN LOSSES -Loan Modifications (Details) - COVID-19 $ in Millions | 6 Months Ended |
Jun. 30, 2022 USD ($) loan | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Delinquent over period | 30 days |
Payments Period | 2 years |
Number of Loans Modified | loan | 55 |
Outstanding Balance of Modified Loans | $ | $ 100.5 |
Loans modified for temporary payment | 180 days |
Number of loans modified | loan | 15 |
Loan deferral amount | $ | $ 3.5 |
LOANS AND THE ALLOWANCE FOR L_5
LOANS AND THE ALLOWANCE FOR LOAN LOSSES - Aging analysis of recorded investments by class (Details) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 USD ($) loan | Dec. 31, 2021 USD ($) loan | |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | $ 35,784 | $ 12,329 |
Current | 2,114,364 | 1,941,839 |
Total Recorded Investment | 2,150,148 | 1,954,168 |
30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 32,565 | 7,573 |
60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 1,314 | 2,548 |
90 or More Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 1,905 | 2,208 |
Cash, Securities and Other | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 3,956 | 751 |
Current | 176,782 | 260,439 |
Total Recorded Investment | 180,738 | 261,190 |
Cash, Securities and Other | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 3,803 | 745 |
Cash, Securities and Other | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 149 | |
Cash, Securities and Other | 90 or More Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 4 | 6 |
Consumer and Other | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 79 | 456 |
Current | 47,776 | 34,302 |
Total Recorded Investment | $ 47,855 | 34,758 |
Number of loans, 90 days delinquent and accruing interest | loan | 9 | |
Consumer and Other | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | $ 36 | 454 |
Consumer and Other | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 35 | |
Consumer and Other | 90 or More Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 8 | 2 |
Construction and Development | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 805 | 2,758 |
Current | 161,621 | 175,958 |
Total Recorded Investment | 162,426 | 178,716 |
Construction and Development | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 2,758 | |
Construction and Development | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 805 | |
1-4 Family Residential | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 9,705 | 1,449 |
Current | 723,020 | 579,423 |
Total Recorded Investment | 732,725 | 580,872 |
1-4 Family Residential | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 9,705 | 1,449 |
Non-Owner Occupied CRE | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 2,548 | |
Current | 489,111 | 480,074 |
Total Recorded Investment | 489,111 | 482,622 |
Non-Owner Occupied CRE | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 2,548 | |
Owner Occupied CRE | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 278 | 1,419 |
Current | 224,319 | 211,007 |
Total Recorded Investment | 224,597 | 212,426 |
Owner Occupied CRE | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 1,419 | |
Owner Occupied CRE | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 278 | |
Commercial. and Industrial. | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 20,961 | 2,948 |
Current | 291,735 | 200,636 |
Total Recorded Investment | 312,696 | $ 203,584 |
Number of loans, 90 days delinquent and accruing interest | loan | 1 | |
Commercial. and Industrial. | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 19,021 | $ 748 |
Commercial. and Industrial. | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 47 | |
Commercial. and Industrial. | 90 or More Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | $ 1,893 | $ 2,200 |
LOANS AND THE ALLOWANCE FOR L_6
LOANS AND THE ALLOWANCE FOR LOAN LOSSES - Recorded investment in non-accrual loans by class (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 USD ($) loan | Jun. 30, 2022 USD ($) | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Non-accrual loans | $ 4,262 | $ 3,877 |
Number of loans classified as TDRs | loan | 3 | |
Recorded investments | $ 4,300 | 3,900 |
Cash, Securities and Other | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Non-accrual loans | 6 | 4 |
Consumer and Other | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Non-accrual loans | 2 | 2 |
1-4 Family Residential | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Non-accrual loans | 75 | 68 |
Owner Occupied CRE | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Non-accrual loans | 1,241 | 1,200 |
Commercial. and Industrial. | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Non-accrual loans | $ 2,938 | $ 2,603 |
LOANS AND THE ALLOWANCE FOR L_7
LOANS AND THE ALLOWANCE FOR LOAN LOSSES - Summary of unpaid principal balance of loans classified as TDRs (Details) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 USD ($) | Dec. 31, 2021 USD ($) loan | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total Recorded Investment | $ 3,877 | $ 4,262 |
Allowance for loan associated with TDR | (263) | (1,753) |
Net recorded investment | 3,660 | 2,564 |
Additional funds to loans classified as TDRs | $ 0 | $ 0 |
Modified Loan Maturity Period | 1 year | |
Number of loans classified as TDRs | loan | 3 | |
Recorded investments | $ 3,900 | $ 4,300 |
Interest only payment period for modified loans | 6 months | |
Cash, Securities and Other | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total Recorded Investment | 4 | $ 6 |
1-4 Family Residential | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total Recorded Investment | 68 | 75 |
Owner Occupied CRE | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total Recorded Investment | 1,200 | 1,241 |
Commercial. and Industrial. | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total Recorded Investment | 2,603 | 2,938 |
Allowance for loan associated with TDR | (261) | (1,751) |
Allowance for loan losses associated with TDR | (261) | (1,751) |
Small Mortgage Loan | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Recorded investments | 100 | |
Commercial and Real Estate | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Recorded investments | 1,200 | |
Commercial Loans | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Recorded investments | 700 | |
Accrual Loans | Non-Owner Occupied CRE | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Loans classified as TDRs | 46 | 55 |
Loans on nonaccrual status | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Loans classified as TDRs | 3,921 | 4,315 |
Loans on nonaccrual status | Cash, Securities and Other | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total Recorded Investment | 4 | 6 |
Loans on nonaccrual status | 1-4 Family Residential | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Loans classified as TDRs | 68 | 75 |
Loans on nonaccrual status | Owner Occupied CRE | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Loans classified as TDRs | 1,200 | 1,241 |
Loans on nonaccrual status | Commercial. and Industrial. | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total Recorded Investment | $ 2,603 | $ 2,938 |
LOANS AND THE ALLOWANCE FOR L_8
LOANS AND THE ALLOWANCE FOR LOAN LOSSES - Recorded investment in impaired loans (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Total Recorded Investment With Allowance | $ 1,895 | $ 1,895 | $ 2,192 | ||
Total Recorded Investment With No Allowance | 1,982 | 1,982 | 2,070 | ||
Total Recorded Investment | 3,877 | 3,877 | 4,262 | ||
Unpaid Contractual Principal Balance with a valuation Allowance | 1,895 | 1,895 | 2,192 | ||
Unpaid Contractual Principal Balance with no related valuation Allowance | 1,982 | 1,982 | 2,070 | ||
Unpaid Contractual Principal Balance | 3,877 | 3,877 | 4,262 | ||
Allowance for Loan Losses | 263 | 263 | 1,753 | ||
Average Recorded Investment with Allowance | 2,043 | $ 3,234 | 2,091 | $ 2,164 | |
Average Recorded Investment with No Allowance | 2,008 | 97 | 2,028 | 78 | |
Average Recorded Investment | 4,051 | 3,331 | 4,119 | 2,242 | |
Interest Income Recognized with Allowance | 21 | 21 | |||
Interest Income Recognized with No Allowance | 51 | 51 | |||
Interest Income Recognized | 72 | 72 | |||
Cash, Securities and Other | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Total Recorded Investment With No Allowance | 4 | 4 | 6 | ||
Total Recorded Investment | 4 | 4 | 6 | ||
Unpaid Contractual Principal Balance with no related valuation Allowance | 4 | 4 | 6 | ||
Unpaid Contractual Principal Balance | 4 | 4 | 6 | ||
Average Recorded Investment with Allowance | 2 | 1 | |||
Average Recorded Investment with No Allowance | 4 | 15 | 4 | 20 | |
Average Recorded Investment | 4 | 17 | 4 | 21 | |
Consumer and Other | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Total Recorded Investment With Allowance | 2 | 2 | 2 | ||
Total Recorded Investment | 2 | 2 | 2 | ||
Unpaid Contractual Principal Balance with a valuation Allowance | 2 | 2 | 2 | ||
Unpaid Contractual Principal Balance | 2 | 2 | 2 | ||
Allowance for Loan Losses | 2 | 2 | 2 | ||
Average Recorded Investment with Allowance | 2 | 2 | 2 | 1 | |
Average Recorded Investment | 2 | 2 | 2 | 1 | |
1-4 Family Residential | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Total Recorded Investment With No Allowance | 68 | 68 | 75 | ||
Total Recorded Investment | 68 | 68 | 75 | ||
Unpaid Contractual Principal Balance with no related valuation Allowance | 68 | 68 | 75 | ||
Unpaid Contractual Principal Balance | 68 | 68 | 75 | ||
Average Recorded Investment with No Allowance | 70 | 72 | |||
Average Recorded Investment | 70 | 72 | |||
Owner Occupied CRE | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Total Recorded Investment With No Allowance | 1,200 | 1,200 | 1,241 | ||
Total Recorded Investment | 1,200 | 1,200 | 1,241 | ||
Unpaid Contractual Principal Balance with no related valuation Allowance | 1,200 | 1,200 | 1,241 | ||
Unpaid Contractual Principal Balance | 1,200 | 1,200 | 1,241 | ||
Average Recorded Investment with No Allowance | 1,211 | 1,221 | |||
Average Recorded Investment | 1,211 | 1,221 | |||
Interest Income Recognized with No Allowance | 51 | 51 | |||
Interest Income Recognized | 51 | 51 | |||
Commercial. and Industrial. | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Total Recorded Investment With Allowance | 1,893 | 1,893 | 2,190 | ||
Total Recorded Investment With No Allowance | 710 | 710 | 748 | ||
Total Recorded Investment | 2,603 | 2,603 | 2,938 | ||
Unpaid Contractual Principal Balance with a valuation Allowance | 1,893 | 1,893 | 2,190 | ||
Unpaid Contractual Principal Balance with no related valuation Allowance | 710 | 710 | 748 | ||
Unpaid Contractual Principal Balance | 2,603 | 2,603 | 2,938 | ||
Allowance for Loan Losses | 261 | 261 | $ 1,751 | ||
Average Recorded Investment with Allowance | 2,041 | 3,230 | 2,089 | 2,162 | |
Average Recorded Investment with No Allowance | 723 | 82 | 731 | 58 | |
Average Recorded Investment | $ 2,764 | 3,312 | $ 2,820 | 2,220 | |
Interest Income Recognized with Allowance | 21 | 21 | |||
Interest Income Recognized | $ 21 | $ 21 |
LOANS AND THE ALLOWANCE FOR L_9
LOANS AND THE ALLOWANCE FOR LOAN LOSSES - Allowance for loan losses by portfolio (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||||
Beginning balance | $ 13,885 | $ 12,539 | $ 13,732 | $ 12,539 | |
(Recovery of) provision for loan losses | 519 | 12 | 729 | 12 | |
Charge-offs | (95) | (192) | |||
Recoveries | 48 | 1 | 88 | 1 | |
Ending balance | 14,357 | 12,552 | 14,357 | 12,552 | |
Individually evaluated | 263 | 263 | $ 1,753 | ||
Collectively evaluated | 14,094 | 14,094 | 11,979 | ||
Loans individually evaluated | 3,877 | 3,877 | 4,262 | ||
Loans collectively evaluated | 2,125,122 | 2,125,122 | 1,949,906 | ||
Measured at fair value | 21,149 | 21,149 | |||
Total Recorded Investment | 2,150,148 | 2,150,148 | 1,954,168 | ||
Cash, Securities and Other | |||||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||||
Beginning balance | 1,440 | 2,380 | 1,598 | 2,439 | |
(Recovery of) provision for loan losses | (246) | (537) | (404) | (596) | |
Ending balance | 1,194 | 1,843 | 1,194 | 1,843 | |
Collectively evaluated | 1,194 | 1,194 | 1,598 | ||
Loans individually evaluated | 4 | 4 | 6 | ||
Loans collectively evaluated | 180,734 | 180,734 | 261,184 | ||
Total Recorded Investment | 180,738 | 180,738 | 261,190 | ||
Consumer and Other | |||||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||||
Beginning balance | 283 | 193 | 266 | 140 | |
(Recovery of) provision for loan losses | (16) | 2 | 58 | 55 | |
Charge-offs | (95) | (192) | |||
Recoveries | 48 | 1 | 88 | 1 | |
Ending balance | 220 | 196 | 220 | 196 | |
Individually evaluated | 2 | 2 | 2 | ||
Collectively evaluated | 218 | 218 | 264 | ||
Loans individually evaluated | 2 | 2 | 2 | ||
Loans collectively evaluated | 26,704 | 26,704 | 34,756 | ||
Measured at fair value | 21,149 | 21,149 | |||
Total Recorded Investment | 47,855 | 47,855 | 34,758 | ||
Construction and Development | |||||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||||
Beginning balance | 954 | 766 | 1,092 | 932 | |
(Recovery of) provision for loan losses | 120 | 105 | (18) | (61) | |
Ending balance | 1,074 | 871 | 1,074 | 871 | |
Collectively evaluated | 1,074 | 1,074 | 1,092 | ||
Loans collectively evaluated | 162,426 | 162,426 | 178,716 | ||
Total Recorded Investment | 162,426 | 162,426 | 178,716 | ||
1-4 Family Residential | |||||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||||
Beginning balance | 3,789 | 3,152 | 3,553 | 3,233 | |
(Recovery of) provision for loan losses | 1,056 | 247 | 1,292 | 166 | |
Ending balance | 4,845 | 3,399 | 4,845 | 3,399 | |
Collectively evaluated | 4,845 | 4,845 | 3,553 | ||
Loans individually evaluated | 68 | 68 | 75 | ||
Loans collectively evaluated | 732,657 | 732,657 | 580,797 | ||
Total Recorded Investment | 732,725 | 732,725 | 580,872 | ||
Non-Owner Occupied CRE | |||||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||||
Beginning balance | 2,867 | 2,211 | 2,952 | 2,004 | |
(Recovery of) provision for loan losses | 368 | 12 | 283 | 219 | |
Ending balance | 3,235 | 2,223 | 3,235 | 2,223 | |
Collectively evaluated | 3,235 | 3,235 | 2,952 | ||
Loans collectively evaluated | 489,111 | 489,111 | 482,622 | ||
Total Recorded Investment | 489,111 | 489,111 | 482,622 | ||
Owner Occupied CRE | |||||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||||
Beginning balance | 1,328 | 1,123 | 1,292 | 1,159 | |
(Recovery of) provision for loan losses | 149 | 102 | 185 | 66 | |
Ending balance | 1,477 | 1,225 | 1,477 | 1,225 | |
Collectively evaluated | 1,477 | 1,477 | 1,292 | ||
Loans individually evaluated | 1,200 | 1,200 | 1,241 | ||
Loans collectively evaluated | 223,397 | 223,397 | 211,185 | ||
Total Recorded Investment | 224,597 | 224,597 | 212,426 | ||
Commercial. and Industrial. | |||||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||||
Beginning balance | 3,224 | 2,714 | 2,979 | 2,632 | |
(Recovery of) provision for loan losses | (912) | 81 | (667) | 163 | |
Ending balance | 2,312 | $ 2,795 | 2,312 | $ 2,795 | |
Individually evaluated | 261 | 261 | 1,751 | ||
Collectively evaluated | 2,051 | 2,051 | 1,228 | ||
Loans individually evaluated | 2,603 | 2,603 | 2,938 | ||
Loans collectively evaluated | 310,093 | 310,093 | 200,646 | ||
Total Recorded Investment | $ 312,696 | $ 312,696 | $ 203,584 |
LOANS AND THE ALLOWANCE FOR _10
LOANS AND THE ALLOWANCE FOR LOAN LOSSES - Recorded investment in company's loans (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | $ 2,150,148,000 | $ 1,954,168,000 |
Pass | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 2,114,848,000 | 1,938,462,000 |
Special Mention | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 7,956,000 | 8,875,000 |
Substandard | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 6,195,000 | 6,831,000 |
Not Rated | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 21,149,000 | |
Doubtful | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 0 | 0 |
Cash, Securities and Other | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 180,738,000 | 261,190,000 |
Cash, Securities and Other | Pass | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 180,734,000 | 261,184,000 |
Cash, Securities and Other | Substandard | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 4,000 | 6,000 |
Consumer and Other | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 47,855,000 | 34,758,000 |
Consumer and Other | Pass | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 26,704,000 | 34,756,000 |
Consumer and Other | Substandard | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 2,000 | 2,000 |
Consumer and Other | Not Rated | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 21,149,000 | |
Construction and Development | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 162,426,000 | 178,716,000 |
Construction and Development | Pass | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 162,426,000 | 176,194,000 |
Construction and Development | Special Mention | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 2,522,000 | |
1-4 Family Residential | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 732,725,000 | 580,872,000 |
1-4 Family Residential | Pass | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 732,657,000 | 580,797,000 |
1-4 Family Residential | Substandard | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 68,000 | 75,000 |
Non-Owner Occupied CRE | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 489,111,000 | 482,622,000 |
Non-Owner Occupied CRE | Pass | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 483,848,000 | 476,670,000 |
Non-Owner Occupied CRE | Special Mention | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 5,263,000 | 5,952,000 |
Owner Occupied CRE | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 224,597,000 | 212,426,000 |
Owner Occupied CRE | Pass | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 222,714,000 | 210,493,000 |
Owner Occupied CRE | Substandard | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 1,883,000 | 1,933,000 |
Commercial. and Industrial. | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 312,696,000 | 203,584,000 |
Commercial. and Industrial. | Pass | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 305,765,000 | 198,368,000 |
Commercial. and Industrial. | Special Mention | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 2,693,000 | 401,000 |
Commercial. and Industrial. | Substandard | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | $ 4,238,000 | $ 4,815,000 |
GOODWILL (Details)
GOODWILL (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended |
Mar. 31, 2022 | Jun. 30, 2022 | Dec. 31, 2021 | |
Goodwill [Roll Forward] | |||
Beginning balance | $ 30,588 | $ 30,588 | $ 24,191 |
Acquisition activity | (188) | ||
Acquisition activity | 6,397 | ||
Ending balance | $ 30,400 | 30,588 | |
Change in goodwill | $ 6,400 | ||
Goodwill adjustments | $ (200) |
LEASES - Leases Balance Sheets
LEASES - Leases Balance Sheets Location (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
LEASES | ||
Operating lease right-of-use asset | $ 9,431 | $ 10,720 |
Operating lease liability | $ 12,325 | $ 13,863 |
Weighted-Average Remaining Lease Term - Operating leases | 4 years 11 months 19 days | 5 years 3 months 3 days |
Weighted-Average Discount Rate - Operating leases | 2.60% | 2.67% |
LEASES - Leases Costs (Details)
LEASES - Leases Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
LEASES | ||||
Operating lease cost | $ 824 | $ 731 | $ 1,619 | $ 1,483 |
Variable lease cost | 528 | 416 | 1,086 | 828 |
Lease costs, net | $ 1,352 | $ 1,147 | $ 2,705 | $ 2,311 |
LEASES - Lease Maturity (Detail
LEASES - Lease Maturity (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2022 | Dec. 31, 2021 | |
LEASES | |||
2022 | $ 1,755 | $ 1,755 | |
2023 | 3,210 | 3,210 | |
2024 | 3,064 | 3,064 | |
2025 | 2,073 | 2,073 | |
2026 | 703 | 703 | |
Thereafter | 2,168 | 2,168 | |
Total future minimum lease payments | 12,973 | 12,973 | |
Less: imputed interest | (648) | (648) | |
Present value of net future minimum lease payments | 12,325 | 12,325 | $ 13,863 |
Lease income | $ 100 | $ 200 |
LEASES - Expected Amortization
LEASES - Expected Amortization Expense (Details) $ in Thousands | Jun. 30, 2022 USD ($) |
LEASES | |
2022 | $ 134 |
2023 | 221 |
2024 | 199 |
Total undiscounted operating lease income | $ 554 |
DEPOSITS (Details)
DEPOSITS (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
DEPOSITS | ||
Money market deposit accounts | $ 1,033,739 | $ 1,056,669 |
Time deposits | 147,623 | 170,491 |
Negotiable order of withdrawal accounts | 287,195 | 309,940 |
Savings accounts | 33,099 | 32,299 |
Total interest bearing deposits | 1,501,656 | 1,569,399 |
Aggregate time deposits of $250,000 or greater | 70,492 | 75,747 |
Overdrafts balances classified As loans | $ 100 | $ 100 |
DEPOSITS - Time Deposits (Detai
DEPOSITS - Time Deposits (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Scheduled maturities of time deposits | ||
2022 | $ 64,114 | |
2023 | 46,252 | |
2024 | 17,812 | |
2025 | 3,029 | |
2026 | 10,337 | |
Thereafter | 6,079 | |
Total | $ 147,623 | $ 170,491 |
BORROWINGS (Details)
BORROWINGS (Details) | 6 Months Ended | 12 Months Ended | |||||
Jan. 01, 2022 USD ($) | Aug. 31, 2021 USD ($) | Nov. 25, 2020 USD ($) | Mar. 17, 2020 USD ($) | Jun. 30, 2022 USD ($) | Dec. 31, 2021 USD ($) | Jan. 06, 2022 USD ($) | |
BORROWINGS | |||||||
Borrowings from FHLB | $ 80,000,000 | $ 15,000,000 | |||||
Number of unsecured federal funds lines of credit | 3 | 3 | |||||
Total loans held for investment | $ 2,150,148,000 | $ 1,954,168,000 | |||||
Federal Funds Lines of Credit One | |||||||
BORROWINGS | |||||||
Maximum borrowing capacity | 10,000,000 | 10,000,000 | |||||
Amount outstanding | 0 | 0 | |||||
Federal Funds Lines of Credit Two | |||||||
BORROWINGS | |||||||
Maximum borrowing capacity | 19,000,000 | 19,000,000 | |||||
Federal Funds Line of Credit Three | |||||||
BORROWINGS | |||||||
Maximum borrowing capacity | 25,000,000 | 25,000,000 | |||||
Subordinated Notes March 2020 | |||||||
BORROWINGS | |||||||
Face amount | $ 8,000,000 | ||||||
interest rate (as a percent) | 5.125% | ||||||
Issuance costs | $ 100,000 | ||||||
Net balance | 7,900,000 | ||||||
Subordinated Notes March 2020 | 90 Day London Interbank Offered Rate [Member] | |||||||
BORROWINGS | |||||||
Basis spread (as a percent) | 4.50% | ||||||
Subordinated Notes November 2020 | |||||||
BORROWINGS | |||||||
Face amount | $ 10,000,000 | ||||||
interest rate (as a percent) | 4.25% | ||||||
Issuance costs | $ 200,000 | ||||||
Net balance | 9,900,000 | ||||||
Subordinated Notes November 2020 | 90 Day London Interbank Offered Rate [Member] | |||||||
BORROWINGS | |||||||
Basis spread (as a percent) | 4.02% | ||||||
Subordinated Notes 2026 [Member] | |||||||
BORROWINGS | |||||||
Maximum offering price | $ 100,000,000 | ||||||
Principle amount outstanding | $ 6,600,000 | ||||||
Redemption percentage | 100% | ||||||
Subordinated Notes | |||||||
BORROWINGS | |||||||
Face amount | $ 15,000,000 | ||||||
interest rate (as a percent) | 3.25% | ||||||
Basis spread (as a percent) | 2.58% | ||||||
Issuance costs | $ 300,000 | ||||||
Net balance | 14,800,000 | ||||||
PPPLF | |||||||
BORROWINGS | |||||||
Advances from Federal Home Loan Banks | $ 7,200,000 | 23,600,000 | |||||
Interest bearing rate | 0.35% | ||||||
PPPLF | Minimum | |||||||
BORROWINGS | |||||||
Debt term | 2 years | ||||||
PPPLF | Maximum | |||||||
BORROWINGS | |||||||
Debt term | 5 years | ||||||
FHLB | |||||||
BORROWINGS | |||||||
Amount of collateral pledged | $ 856,600,000 | 771,400,000 | |||||
Available balance | $ 517,000,000 | ||||||
April 22, 2022 | |||||||
BORROWINGS | |||||||
Interest rate | 0.37% | ||||||
Borrowings from FHLB | 5,000,000 | ||||||
July 1, 2022 | |||||||
BORROWINGS | |||||||
Interest rate | 1.63% | ||||||
Borrowings from FHLB | $ 70,000,000 | ||||||
May 5, 2023 | |||||||
BORROWINGS | |||||||
Interest rate | 0.76% | ||||||
Borrowings from FHLB | $ 10,000,000 | $ 10,000,000 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Unused lines of credit-Fixed | ||
COMMITMENTS AND CONTINGENCIES | ||
Other commitment | $ 128,605 | $ 136,289 |
Standby letters of credit-Fixed | ||
COMMITMENTS AND CONTINGENCIES | ||
Other commitment | 6,263 | 2,420 |
Commitments to make loans to sell-Fixed | ||
COMMITMENTS AND CONTINGENCIES | ||
Other commitment | 37,841 | 60,529 |
Commitments to make loans-Fixed | ||
COMMITMENTS AND CONTINGENCIES | ||
Other commitment | 52,056 | 16,256 |
Unused lines of credit-Variable | ||
COMMITMENTS AND CONTINGENCIES | ||
Other commitment | 575,094 | 442,035 |
Standby letters of credit-Variable | ||
COMMITMENTS AND CONTINGENCIES | ||
Other commitment | 22,035 | 20,940 |
Commitments to make loans-Variable | ||
COMMITMENTS AND CONTINGENCIES | ||
Other commitment | $ 17,749 | $ 14,920 |
SHAREHOLDERS EQUITY - Common St
SHAREHOLDERS EQUITY - Common Stock (Details) - $ / shares | 6 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | Nov. 03, 2020 | |
Class of Stock [Line Items] | ||||
Common stock par value | $ 0 | $ 0 | ||
Common Stock | ||||
Class of Stock [Line Items] | ||||
Common stock par value | $ 0 | |||
Number of votes per each share | one | |||
Effective term of program | 1 year | |||
Issuance of common stock for Teton Acquisition (in shares) | 0 | 0 | ||
Common Stock | 2020 Repurchase Plan | ||||
Class of Stock [Line Items] | ||||
Common stock par value | $ 0 | |||
Authorized share repurchase | 400,000 |
SHAREHOLDERS EQUITY - Stock bas
SHAREHOLDERS EQUITY - Stock based compensation - Restricted Stock Awards (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2017 | |
Restricted Stock Awards | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares issued | 105,264 | ||||
Value of shares issued | $ 3 | ||||
Weighted-average grant date fair value (in dollars per share) | $ 28.50 | $ 28.50 | |||
Recognized compensation expense | $ 0.1 | $ 0.1 | $ 0.2 | $ 0.2 | |
Number of stock awards vested | 0 | 0 | |||
Unrecognized compensation expense | 0.1 | $ 0.1 | |||
Unrecognized compensation expense recognition period (in years) | 1 year | ||||
Employee service period | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares issued | 52,632 | ||||
Value of shares issued | $ 1.5 | ||||
Vesting period (in years) | 5 years | ||||
Performance of mortgage division | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares issued | 52,632 | ||||
Value of shares issued | $ 1.5 | ||||
Stock options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Recognized compensation expense | $ 0 | $ 0 |
SHAREHOLDERS EQUITY - Stock b_2
SHAREHOLDERS EQUITY - Stock based compensation - Stock Options (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2022 | Jun. 30, 2021 | |
Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Granted (in shares) | 0 | 0 | |
Stock-based compensation expense | $ 0 | $ 0 | |
Unrecognized stock-based compensation expense | $ 0 | $ 0 | |
2016 Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares available for issuance | 202,565 | 202,565 |
SHAREHOLDERS EQUITY - Stock b_3
SHAREHOLDERS EQUITY - Stock based compensation - Stock Options Activity (Details) - Stock options | 6 Months Ended | |
Jun. 30, 2022 $ / shares shares | Jun. 30, 2021 shares | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Outstanding at beginning of year (in shares) | shares | 308,574 | |
Granted (in shares) | shares | 0 | 0 |
Exercised (in shares) | shares | (6,809) | |
Forfeited or expired (in shares) | shares | (116,100) | |
Outstanding at end of period (in shares) | shares | 185,665 | |
Options fully vested / exercisable at end of period (in shares) | shares | 185,665 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||
Options, Outstanding, Weighted Average Exercise Price, Beginning Balance | $ 29.21 | |
Exercised (in dollars per share) | 21.47 | |
Forfeited or expired (in dollars per share) | 40 | |
Options, Outstanding, Weighted Average Exercise Price, Ending Balance | 22.75 | |
Options fully vested / exercisable | $ 22.75 | |
Weighted Average Remaining Contractual Term | ||
Outstanding at end of year | 2 years 7 months 6 days | |
Options fully vested / exercisable | 2 years 7 months 6 days | |
Aggregate Intrinsic Value | ||
Exercise price low range | $ 20 | |
Exercise price high range | $ 27 | |
Expiry period | 10 years |
SHAREHOLDERS EQUITY - Stock b_4
SHAREHOLDERS EQUITY - Stock based compensation - Share Awards (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||||
Stock issued (in shares) | 53,461 | 36,932 | 61,686 | 43,059 |
Stock surrendered (in shares) | 21,345 | 14,545 | 25,634 | 17,369 |
Stock surrendered to cover employee withholding taxes | $ 0.7 | $ 0.4 | $ 0.8 | $ 0.4 |
Time Vesting Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||||
Outstanding at beginning of year | 249,821 | |||
Granted (in shares) | 126,004 | |||
Vested (in shares) | (75,220) | |||
Forfeited (in shares) | (14,007) | |||
Outstanding at end of year | 286,598 | 286,598 | ||
Stock-based compensation expense | $ 0.4 | $ 0.4 | $ 0.9 | $ 0.8 |
Unrecognized compensation expense | $ 6.4 | $ 6.4 | ||
Unrecognized compensation expense recognition period (in years) | 2 years 2 months 12 days | |||
Time Vesting Units | Third and fifth anniversaries | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||||
Service period (in years) | 5 years | |||
Time Vesting Units | Anniversary of grant date | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||||
Granted (in shares) | 126,004 | |||
Vesting Percentage | 20% | |||
Financial Performance Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||||
Outstanding at beginning of year | 183,483 | |||
Granted (in shares) | 64,629 | |||
Vested (in shares) | (12,100) | |||
Forfeited (in shares) | (12,086) | |||
Outstanding at end of year | 223,926 | 223,926 | ||
Market Performance Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||||
Outstanding at beginning of year | 13,746 | |||
Forfeited (in shares) | (13,746) | |||
Unrecognized compensation expense | $ 0 | $ 0 |
SHAREHOLDERS EQUITY - Stock b_5
SHAREHOLDERS EQUITY - Stock based compensation - Financial Performance Units (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Financial Performance Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Granted (in shares) | 64,629 | |||
Financial Performance Units | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Financial performance threshold percentage | 150% | |||
Financial Performance Units | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Financial performance threshold percentage | 0% | |||
Financial Performance Units Granted Prior to May 1, 2019 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 3 | $ 18 | ||
Financial Performance Units Granted From May 1, 2019 Through April 30, 2020 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Percent of awards accruing at maximum threshold | 150% | |||
Maximum number of shares can be issued | 76,797 | 76,797 | ||
Unrecognized compensation expense | $ 242 | $ 242 | ||
Unrecognized compensation expense recognition period (in years) | 1 year 7 months 6 days | |||
Stock-based compensation expense | $ 29 | 61 | $ 90 | 117 |
Financial Performance Units Granted From May 01, 2020 Through December 31 2020, Excluding November 18, 2020 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Percent of awards accruing at maximum threshold | 150% | |||
Maximum number of shares can be issued | 76,886 | 76,886 | ||
Unrecognized compensation expense | $ 345 | $ 345 | ||
Unrecognized compensation expense recognition period (in years) | 2 years 6 months | |||
Stock-based compensation expense | $ 29 | 54 | $ 82 | 109 |
Financial Performance Units Granted on November 18, 2020 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Percent of awards accruing at maximum threshold | 134% | |||
Remainder threshold awards | 50% | 50% | ||
Maximum number of shares can be issued | 29,212 | 29,212 | ||
Unrecognized compensation expense | $ 278 | $ 278 | ||
Unrecognized compensation expense recognition period (in years) | 2 years 4 months 24 days | |||
Stock-based compensation expense | $ (2) | 30 | $ 28 | $ 64 |
Financial Performance Units Granted From May 3 2021 Through August 11,2021 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Percent of awards accruing at maximum threshold | 150% | |||
Maximum number of shares can be issued | 56,148 | 56,148 | ||
Unrecognized compensation expense | $ 735 | $ 735 | ||
Unrecognized compensation expense recognition period (in years) | 3 years 6 months | |||
Granted (in shares) | 41,366 | |||
Stock-based compensation expense | $ 58 | $ 57 | $ 139 | $ 57 |
Financial Performance Units Granted On May 2, 2022 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Percent of awards accruing at maximum threshold | 79% | |||
Maximum number of shares can be issued | 49,127 | 49,127 | ||
Unrecognized compensation expense | $ 2,988 | $ 2,988 | ||
Unrecognized compensation expense recognition period (in years) | 4 years 6 months | |||
Granted (in shares) | 64,629 | |||
Stock-based compensation expense | $ 58 | $ 58 |
SHAREHOLDERS EQUITY - Stock b_6
SHAREHOLDERS EQUITY - Stock based compensation - Market Performance Units (Details) $ in Millions | Jun. 30, 2022 USD ($) |
Market Performance Units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized compensation expense | $ 0 |
EARNINGS PER COMMON SHARE (Deta
EARNINGS PER COMMON SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Numerator: | ||||
Net income available for common shareholders | $ 4,482 | $ 6,277 | $ 10,006 | $ 12,276 |
Denominator: | ||||
Basic weighted average shares | 9,450,987 | 7,961,785 | 9,434,742 | 7,948,796 |
Earnings per common share - basic | $ 0.47 | $ 0.79 | $ 1.06 | $ 1.54 |
Numerator: | ||||
Net income | $ 4,482 | $ 6,277 | $ 10,006 | $ 12,276 |
Denominator: | ||||
Basic weighted average shares | 9,450,987 | 7,961,785 | 9,434,742 | 7,948,796 |
Diluted effect of common stock equivalents: | ||||
Total diluted effect of common stock equivalents | 266,680 | 252,115 | 310,169 | 211,463 |
Diluted weighted average shares | 9,717,667 | 8,213,900 | 9,744,911 | 8,160,259 |
Earnings per common share - diluted | $ 0.46 | $ 0.76 | $ 1.03 | $ 1.50 |
Stock options | ||||
Diluted effect of common stock equivalents: | ||||
Diluted effect of common stock equivalents | 52,870 | 35,849 | 55,005 | 20,386 |
Time Vesting Units | ||||
Diluted effect of common stock equivalents: | ||||
Diluted effect of common stock equivalents | 122,090 | 131,684 | 155,813 | 117,107 |
Financial Performance Units | ||||
Diluted effect of common stock equivalents: | ||||
Diluted effect of common stock equivalents | 91,720 | 70,746 | 92,524 | 59,953 |
Market Performance Units | ||||
Diluted effect of common stock equivalents: | ||||
Diluted effect of common stock equivalents | 13,836 | 6,827 | 14,017 |
EARNINGS PER COMMON SHARE - Ant
EARNINGS PER COMMON SHARE - Anti-dilutive Securities (Details) - shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
EARNINGS PER COMMON SHARE | ||||
Total potentially dilutive securities | 121,942 | 168,374 | 60,971 | 247,344 |
Stock options | ||||
EARNINGS PER COMMON SHARE | ||||
Total potentially dilutive securities | 141,639 | 209,874 | ||
Time Vesting Units | ||||
EARNINGS PER COMMON SHARE | ||||
Total potentially dilutive securities | 121,942 | 60,971 | 1,991 | |
Financial Performance Units | ||||
EARNINGS PER COMMON SHARE | ||||
Total potentially dilutive securities | 26,735 | 24,952 | ||
Restricted Stock Awards | ||||
EARNINGS PER COMMON SHARE | ||||
Total potentially dilutive securities | 10,527 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
INCOME TAXES | ||||
Income tax provision | $ 1,494 | $ 1,911 | $ 3,286 | $ 3,951 |
Effective income tax rate | 25% | 23.30% | 24.70% | 24.30% |
RELATED-PARTY TRANSACTIONS (Det
RELATED-PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Summary of related party loan activity | |||||
Balance, beginning of year | $ 12,833 | $ 14,321 | $ 14,321 | ||
Funded loans | 12,880 | 11,294 | |||
Payments collected | (7,102) | (12,782) | |||
Balance, end of year | $ 18,611 | 18,611 | 12,833 | ||
Deposits from related parties | 38,600 | 38,600 | 51,000 | ||
Impaired Financing Receivable, Recorded Investment | 3,877 | 3,877 | $ 4,262 | ||
Trust and investment management fees | $ 4,784 | $ 5,009 | 9,952 | 9,856 | |
Board Member | |||||
Summary of related party loan activity | |||||
Rental expense | $ 100 | $ 100 |
FAIR VALUE - Summary of assets
FAIR VALUE - Summary of assets measured at fair value on recurring basis (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | $ 55,562 | |
Mortgage loans held for sale, at fair value | $ 26,202 | 30,620 |
U.S. Treasury debt | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 247 | |
U.S. Government Agency | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 3,522 | |
Corporate bonds | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 8,325 | |
Government CMO and MBS | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 878 | |
Corporate CMO and MBS | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 1,497 | |
Recurring | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 55,562 | |
Loans held at fair value | 21,477 | |
Equity securities | 777 | 1,198 |
Guarantee asset | 174 | 237 |
Equity warrants | 725 | 160 |
Mortgage loans held for sale, at fair value | 26,202 | 30,620 |
Recurring | U.S. Treasury debt | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 247 | |
Recurring | U.S. Government Agency | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 3,522 | |
Recurring | Corporate bonds | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 8,325 | |
Recurring | Government CMO and MBS | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 878 | |
Recurring | Corporate CMO and MBS | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 1,497 | |
Recurring | IRLC,net | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Derivative asset, Fair value | 836 | 1,473 |
Recurring | Forward Commitment | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Derivative asset, Fair value | 239 | (74) |
Recurring | GNMA | mortgage-backed securities - residential | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 26,650 | |
Recurring | FNMA | mortgage-backed securities - residential | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 14,443 | |
Level 1 | Recurring | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 247 | |
Equity securities | 655 | 709 |
Level 1 | Recurring | U.S. Treasury debt | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 247 | |
Level 2 | Recurring | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 53,202 | |
Equity securities | 122 | 489 |
Mortgage loans held for sale, at fair value | 26,202 | 30,620 |
Level 2 | Recurring | U.S. Government Agency | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 3,522 | |
Level 2 | Recurring | Corporate bonds | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 6,212 | |
Level 2 | Recurring | Government CMO and MBS | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 878 | |
Level 2 | Recurring | Corporate CMO and MBS | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 1,497 | |
Level 2 | Recurring | Forward Commitment | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Derivative asset, Fair value | 239 | (65) |
Level 2 | Recurring | GNMA | mortgage-backed securities - residential | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 26,650 | |
Level 2 | Recurring | FNMA | mortgage-backed securities - residential | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 14,443 | |
Level 3 | Recurring | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 2,113 | |
Loans held at fair value | 21,477 | |
Guarantee asset | 174 | 237 |
Equity warrants | 725 | 160 |
Level 3 | Recurring | Corporate bonds | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Available-for-sale securities, at fair value | 2,113 | |
Level 3 | Recurring | IRLC,net | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Derivative asset, Fair value | $ 836 | 1,473 |
Level 3 | Recurring | Forward Commitment | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Derivative asset, Fair value | $ (9) |
FAIR VALUE - Loans measured at
FAIR VALUE - Loans measured at fair value under fair value option (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total loans, fair value | $ 47,679,000 | $ 30,620,000 |
Total loans, unpaid principal balance | 47,007,000 | 29,857,000 |
Total loans, difference | 672,000 | 763,000 |
Non-accruals, fair value | 0 | 0 |
90 days or more past due, fair value | 0 | 0 |
Loans Held for Sale | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total loans, fair value | 26,202,000 | 30,620,000 |
Total loans, unpaid principal balance | 25,858,000 | 29,857,000 |
Total loans, difference | 344,000 | $ 763,000 |
Loan Held for Investment | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total loans, fair value | 21,477,000 | |
Total loans, unpaid principal balance | 21,149,000 | |
Total loans, difference | $ 328,000 |
FAIR VALUE - Schedule of gain o
FAIR VALUE - Schedule of gain or loss on fair value of loans (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Gain or loss on loans | $ (66) | $ 417 | $ (91) | $ (4,165) |
Loans Held for Sale | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Gain or loss on loans | (394) | $ 417 | (419) | $ (4,165) |
Loan Held for Investment | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Gain or loss on loans | $ 328 | $ 328 |
FAIR VALUE - Summary of activit
FAIR VALUE - Summary of activity pertaining to loans under fair value option (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Loans Held for Sale | ||||
Guarantee asset | ||||
Beginning balance | $ 33,663 | $ 176,644 | $ 30,620 | $ 161,843 |
Loans originated | 278,720 | 365,423 | 470,494 | 901,777 |
Fair value changes | (394) | 417 | (419) | (4,165) |
Sales | (285,777) | (493,029) | (474,443) | (1,007,574) |
Settlements | (10) | (892) | (50) | (3,318) |
Ending balance | 26,202 | $ 48,563 | 26,202 | $ 48,563 |
Loan Held for Investment | ||||
Guarantee asset | ||||
Beginning balance | 6,380 | |||
Loans acquired | 17,869 | 24,249 | ||
Fair value changes | 328 | 328 | ||
Settlements | (3,100) | (3,100) | ||
Ending balance | $ 21,477 | $ 21,477 |
FAIR VALUE - Summary of asset_2
FAIR VALUE - Summary of assets measured at level 3 fair value on recurring basis (Details) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 USD ($) loan | Dec. 31, 2021 USD ($) loan | |
Summary of assets measured on a recurring and nonrecurring basis | ||
Impaired Financing Receivable, with Related Allowance, Recorded Investment | $ 1,895 | $ 2,192 |
Loans and Leases Receivable, Allowance | 14,357 | 13,732 |
Other real estate owned | 378 | |
Net recorded investment | $ 3,660 | $ 2,564 |
Consumer and Other | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Loan Reserved For Specific Allowance | loan | 1 | 1 |
Impaired Financing Receivable, with Related Allowance, Recorded Investment | $ 2 | $ 2 |
Nonrecurring | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Other real estate owned | 378 | |
Level 3 | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Impaired Financing Receivable, with Related Allowance, Recorded Investment | 1,900 | 2,200 |
Loans and Leases Receivable, Allowance | 300 | 1,800 |
Provision for loan losses | 300 | 1,800 |
OREO carrying amount | 400 | |
Level 3 | Nonrecurring | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Other real estate owned | 378 | |
Commercial and Industrial | Nonrecurring | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Net recorded investment | 1,632 | 439 |
Commercial and Industrial | Level 3 | Nonrecurring | ||
Summary of assets measured on a recurring and nonrecurring basis | ||
Net recorded investment | $ 1,632 | $ 439 |
FAIR VALUE - Summary of asset_3
FAIR VALUE - Summary of assets measured at fair value on recurring basis (Details) - Level 3 - Nonrecurring - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Corporate bonds | ||||
Guarantee asset | ||||
Beginning balance | $ 6,215 | $ 2,113 | ||
Acquisitions | 4,000 | |||
Unrealized gains/(losses), net | 102 | |||
Transfer to held-to-maturity | (6,215) | (6,215) | ||
Loans Held at Fair Value | ||||
Guarantee asset | ||||
Beginning balance | 6,380 | |||
Acquisitions | 18,352 | 24,732 | ||
Gains (losses) in net income, net | (155) | (155) | ||
Settlements | (3,100) | (3,100) | ||
Ending balance | 21,477 | 21,477 | ||
Fair value on a recurring basis | ||||
Settlements | (3,100) | (3,100) | ||
Forward Commitment | ||||
Guarantee asset | ||||
Beginning balance | $ (173) | (9) | $ (89) | |
Acquisitions | 9 | (173) | ||
Gains (losses) in net income, net | 173 | 262 | ||
Guarantee Asset | ||||
Guarantee asset | ||||
Beginning balance | 206 | 188 | 237 | 232 |
Acquisitions | 2 | |||
Originations | 2 | |||
Gains (losses) in net income, net | (32) | 6 | (63) | (38) |
Ending balance | 174 | 196 | 174 | 196 |
IRLC,net | ||||
Guarantee asset | ||||
Beginning balance | 990 | 2,105 | 1,473 | 9,841 |
Acquisitions | 1,083 | 5,823 | 2,697 | 8,507 |
Originations | (2,063) | (5,981) | (3,417) | (12,997) |
Gains (losses) in net income, net | 826 | 861 | 83 | (2,543) |
Ending balance | 836 | $ 2,808 | 836 | $ 2,808 |
Equity Warrants | ||||
Guarantee asset | ||||
Beginning balance | 402 | 160 | ||
Acquisitions | 242 | |||
Gains (losses) in net income, net | 323 | 323 | ||
Ending balance | $ 725 | $ 725 |
FAIR VALUE - Summary of asset_4
FAIR VALUE - Summary of assets and liabilities measured at fair value on a recurring or nonrecurring, the significant unobservable inputs (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt Securities, Available-for-sale | $ 55,562 | |
Fair value (Held to Maturity) | $ 84,742 | |
Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt Securities, Available-for-sale | 8,325 | |
Fair value (Held to Maturity) | 23,440 | |
Nonrecurring | Commission and Cost to Sell | Level 3 | Commercial properties | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, Fair Value Estimate | $ 378 | |
Range and weighted average of discount rate | 9% | |
Nonrecurring | Management discount for asset/property type | Level 3 | Commercial and Industrial | Sales Comparison, Market Approach [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, Fair Value Estimate | $ 1,632 | $ 439 |
Range and weighted average of discount rate | 10% | |
Nonrecurring | Minimum | Management discount for asset/property type | Level 3 | Commercial and Industrial | Sales Comparison, Market Approach [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 17% | |
Nonrecurring | Maximum | Management discount for asset/property type | Level 3 | Commercial and Industrial | Sales Comparison, Market Approach [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 45% | |
Nonrecurring | Weighted Average | Management discount for asset/property type | Level 3 | Commercial and Industrial | Sales Comparison, Market Approach [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 39% | |
Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt Securities, Available-for-sale | $ 55,562 | |
Loans held at fair value, Fair value | $ 21,477 | |
Guarantee asset, Fair Value | 174 | 237 |
Equity warrants, Fair value | 725 | 160 |
Recurring | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt Securities, Available-for-sale | 2,113 | |
Loans held at fair value, Fair value | 21,477 | |
Guarantee asset, Fair Value | 174 | 237 |
Equity warrants, Fair value | $ 725 | $ 160 |
Recurring | Discount rate | Level 3 | Discounted cash flow | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 4% | 3% |
Recurring | Prepayment rate | Level 3 | Discounted cash flow | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 8% | 18% |
Recurring | Weighted Average | Discount rate | Level 3 | Discounted cash flow | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 4% | 3% |
Recurring | Weighted Average | Prepayment rate | Level 3 | Discounted cash flow | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 8% | 18% |
Recurring | Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt Securities, Available-for-sale | $ 8,325 | |
Recurring | Corporate bonds | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt Securities, Available-for-sale | 2,113 | |
Recurring | Corporate bonds | Discount rate | Level 3 | Discounted cash flow | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt Securities, Available-for-sale | $ 2,113 | |
Range and weighted average of discount rate | 7% | |
Recurring | Corporate bonds | Weighted Average | Discount rate | Level 3 | Discounted cash flow | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 7% | |
Recurring | Loans Held at Fair Value | Discount rate | Level 3 | Discounted cash flow | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans held at fair value, Fair value | $ 21,477 | |
Recurring | Loans Held at Fair Value | Minimum | Discount rate | Level 3 | Discounted cash flow | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 4% | |
Recurring | Loans Held at Fair Value | Maximum | Discount rate | Level 3 | Discounted cash flow | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 19% | |
Recurring | Loans Held at Fair Value | Weighted Average | Discount rate | Level 3 | Discounted cash flow | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 10% | |
Recurring | Guarantee Asset | Prepayment rate | Level 3 | Discounted cash flow | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Guarantee asset, Fair Value | $ 174 | $ 237 |
Recurring | IRLC,net | Pull through | Level 3 | Best execution model | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets, Fair Value | $ 836 | $ 1,473 |
Range and weighted average of discount rate | 94% | |
Recurring | IRLC,net | Minimum | Pull through | Level 3 | Best execution model | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 67% | 71% |
Recurring | IRLC,net | Maximum | Pull through | Level 3 | Best execution model | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 100% | 100% |
Recurring | IRLC,net | Weighted Average | Pull through | Level 3 | Best execution model | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 88% | |
Recurring | IRLC,net | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets, Fair Value | $ 836 | $ 1,473 |
Recurring | IRLC,net | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets, Fair Value | 836 | 1,473 |
Recurring | Equity Warrants | Volatility | Level 3 | Black-Scholes option pricing model | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity warrants, Fair value | $ 160 | |
Recurring | Equity Warrants | Risk-free interest rate | Level 3 | Black-Scholes option pricing model | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity warrants, Fair value | $ 725 | |
Recurring | Equity Warrants | Minimum | Volatility | Black-Scholes option pricing model | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 32.40% | |
Range term | 0 years | |
Recurring | Equity Warrants | Minimum | Volatility | Level 3 | Sales Comparison, Market Approach [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 24% | |
Recurring | Equity Warrants | Minimum | Risk-free interest rate | Black-Scholes option pricing model | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 1.78% | |
Recurring | Equity Warrants | Minimum | Risk-free interest rate | Level 3 | Sales Comparison, Market Approach [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 0.30% | |
Recurring | Equity Warrants | Minimum | Remaining life | Level 3 | Sales Comparison, Market Approach [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range term | 0 years | |
Recurring | Equity Warrants | Maximum | Volatility | Black-Scholes option pricing model | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 32.50% | |
Range term | 4 years | |
Recurring | Equity Warrants | Maximum | Volatility | Level 3 | Sales Comparison, Market Approach [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 37% | |
Recurring | Equity Warrants | Maximum | Risk-free interest rate | Black-Scholes option pricing model | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 2.95% | |
Recurring | Equity Warrants | Maximum | Risk-free interest rate | Level 3 | Sales Comparison, Market Approach [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 1.10% | |
Recurring | Equity Warrants | Maximum | Remaining life | Level 3 | Sales Comparison, Market Approach [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range term | 4 years | |
Recurring | Equity Warrants | Weighted Average | Volatility | Black-Scholes option pricing model | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 32.50% | |
Recurring | Equity Warrants | Weighted Average | Volatility | Level 3 | Sales Comparison, Market Approach [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 32% | |
Recurring | Equity Warrants | Weighted Average | Risk-free interest rate | Black-Scholes option pricing model | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 2.69% | |
Recurring | Equity Warrants | Weighted Average | Risk-free interest rate | Level 3 | Sales Comparison, Market Approach [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Range and weighted average of discount rate | 0.97% | |
Recurring | Forward Commitment | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets, Fair Value | $ 239 | $ (74) |
Recurring | Forward Commitment | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets, Fair Value | (9) | |
Recurring | Forward Commitment | Market Differential | Level 3 | Internal Pricing Model | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets, Fair Value | $ (9) | |
Recurring | Forward Commitment | Minimum | Market Differential | Level 3 | Internal Pricing Model | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets | (0.14) | |
Recurring | Forward Commitment | Maximum | Market Differential | Level 3 | Internal Pricing Model | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets | (0.02) | |
Recurring | Forward Commitment | Weighted Average | Market Differential | Level 3 | Internal Pricing Model | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets | (0.06) |
FAIR VALUE - Summary of carryin
FAIR VALUE - Summary of carrying amounts and estimated fair values for financial instruments (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2020 |
Assets | ||||
Cash and cash equivalents | $ 171,606 | $ 386,983 | $ 289,089 | $ 155,989 |
Loans, net | 2,132,037 | 1,935,405 | ||
Accrued interest receivable | 7,884 | 7,151 | ||
Liabilities | ||||
Deposits | 2,169,998 | 2,205,703 | ||
FHLB borrowings - fixed rate | 87,223 | 38,629 | ||
Subordinated notes | 32,553 | 39,031 | ||
Accrued interest payable | 304 | 355 | ||
Carrying Amount | ||||
Assets | ||||
Cash and cash equivalents | 171,606 | 386,983 | ||
Held-to-maturity securities | 87,029 | |||
Loans, net | 2,132,037 | 1,935,405 | ||
Accrued interest receivable | 7,884 | 7,151 | ||
Liabilities | ||||
Deposits | 2,169,998 | 2,205,703 | ||
FHLB borrowings - fixed rate | 80,000 | 15,000 | ||
Federal Reserve Borrowings - fixed rate | 7,223 | 23,629 | ||
Accrued interest payable | 304 | 355 | ||
Subordinated notes - fixed-to-floating rate | Carrying Amount | ||||
Liabilities | ||||
Subordinated notes | 32,553 | 39,031 | ||
Level 1 | Estimated Fair Value | ||||
Assets | ||||
Cash and cash equivalents | 171,606 | 386,983 | ||
Held-to-maturity securities | 236 | |||
Accrued interest receivable | 3 | 2 | ||
Liabilities | ||||
Deposits | 2,022,624 | 2,035,212 | ||
Accrued interest payable | 38 | 87 | ||
Level 2 | Estimated Fair Value | ||||
Assets | ||||
Held-to-maturity securities | 75,699 | |||
Accrued interest receivable | 333 | 203 | ||
Liabilities | ||||
FHLB borrowings - fixed rate | 79,789 | 14,990 | ||
Federal Reserve Borrowings - fixed rate | 7,223 | 23,629 | ||
Level 3 | Estimated Fair Value | ||||
Assets | ||||
Held-to-maturity securities | 8,807 | |||
Loans, net | 2,105,608 | 1,919,625 | ||
Accrued interest receivable | 7,548 | 6,946 | ||
Liabilities | ||||
Deposits | 148,933 | 172,240 | ||
Accrued interest payable | 266 | 268 | ||
Level 3 | Subordinated notes - fixed-to-floating rate | Estimated Fair Value | ||||
Liabilities | ||||
Subordinated notes | $ 32,476 | $ 40,325 |
SEGMENT REPORTING (Details)
SEGMENT REPORTING (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Statement | ||||||
Total interest income | $ 21,631 | $ 15,548 | $ 41,296 | $ 30,047 | ||
Total interest expense | 1,493 | 1,325 | 2,874 | 2,771 | ||
Provision for loan losses | 519 | 12 | 729 | 12 | ||
Net interest income, after provision for loan losses | 19,619 | 14,211 | 37,693 | 27,264 | ||
Non-interest income | 6,940 | 9,500 | 15,540 | 20,102 | ||
Total income | 26,559 | 23,711 | 53,233 | 47,366 | ||
Depreciation and amortization expense | 534 | 275 | 1,094 | 547 | ||
Net (gain)/loss on assets held for sale | (2) | (3) | ||||
All other non-interest expense | 20,051 | 15,248 | 38,850 | 30,592 | ||
Income before income taxes | 5,976 | 8,188 | 13,292 | 16,227 | ||
Segment reporting | ||||||
Goodwill | 30,400 | 24,191 | 30,400 | 24,191 | $ 30,588 | $ 24,191 |
Assets held for sale | 146 | 146 | 115 | |||
Total assets | 2,541,493 | 2,009,304 | 2,541,493 | 2,009,304 | $ 2,527,489 | |
Wealth Management | ||||||
Income Statement | ||||||
Total interest income | 21,631 | 15,548 | 41,296 | 30,047 | ||
Total interest expense | 1,493 | 1,325 | 2,874 | 2,771 | ||
Provision for loan losses | 519 | 12 | 729 | 12 | ||
Net interest income, after provision for loan losses | 19,619 | 14,211 | 37,693 | 27,264 | ||
Non-interest income | 5,663 | 5,573 | 11,745 | 10,978 | ||
Total income | 25,282 | 19,784 | 49,438 | 38,242 | ||
Depreciation and amortization expense | 522 | 262 | 1,070 | 520 | ||
Net (gain)/loss on assets held for sale | (2) | (3) | ||||
All other non-interest expense | 17,836 | 12,539 | 34,434 | 24,822 | ||
Income before income taxes | 6,926 | 6,983 | 13,937 | 12,900 | ||
Segment reporting | ||||||
Goodwill | 30,400 | 24,191 | 30,400 | 24,191 | ||
Total assets | 2,513,177 | 1,956,393 | 2,513,177 | 1,956,393 | ||
Mortgage | ||||||
Income Statement | ||||||
Non-interest income | 1,277 | 3,927 | 3,795 | 9,124 | ||
Total income | 1,277 | 3,927 | 3,795 | 9,124 | ||
Depreciation and amortization expense | 12 | 13 | 24 | 27 | ||
All other non-interest expense | 2,215 | 2,709 | 4,416 | 5,770 | ||
Income before income taxes | (950) | 1,205 | (645) | 3,327 | ||
Segment reporting | ||||||
Total assets | $ 28,316 | $ 52,911 | $ 28,316 | $ 52,911 |
LOW-INCOME HOUSING TAX CREDIT_2
LOW-INCOME HOUSING TAX CREDIT INVESTMENT (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Schedule of Investments [Line Items] | |||||
Unfunded commitments | $ 0 | $ 0 | $ 0.2 | ||
Tax credits and other benefits | 0.1 | $ 0.1 | 0.2 | $ 0.2 | |
Impairment losses | 0 | 0 | 0 | 0 | |
Other Assets [Member] | |||||
Schedule of Investments [Line Items] | |||||
Investment balance | 2.6 | 2.6 | $ 2.6 | ||
Income Tax Expense (Benefit). | |||||
Schedule of Investments [Line Items] | |||||
Amortization expense | $ 0.1 | $ 0.1 | $ 0.2 | $ 0.2 |
REGULATORY CAPITAL MATTERS (Det
REGULATORY CAPITAL MATTERS (Details) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 USD ($) item | Dec. 31, 2021 USD ($) | |
REGULATORY CAPITAL MATTERS | ||
Capital injection | $ 2,900 | |
Capital conservation buffer | 2.50% | |
Common Equity Tier 1 capital ratio including capital conservation buffer (as a percent) | 7% | |
Number of conditions or events to be performed | item | 0 | |
Common Equity Tier 1 (CET 1) to risk-weighted assets | ||
Actual Amount | $ 199,379 | $ 188,777 |
Actual Ratio (as a percent) | 10.15% | 10.54% |
Tier 1 capital to risk-weighted assets | ||
Actual Amount | $ 199,379 | $ 188,777 |
Actual Ratio (as a percent) | 0.1015 | 0.1054 |
Required for Capital Adequacy Purposes Amount (as a percent) | 0.085 | |
Total capital to risk-weighted assets | ||
Actual Amount | $ 247,164 | $ 242,388 |
Actual Ratio (as a percent) | 0.1258 | 0.1354 |
Required for Capital Adequacy Purposes Ratio (as a percent) | 0.105 | |
Tier 1 capital to average assets | ||
Actual Amount | $ 199,379 | $ 188,777 |
Actual Ratio (as a percent) | 0.0800 | 0.0931 |
Bank | ||
Common Equity Tier 1 (CET 1) to risk-weighted assets | ||
Actual Amount | $ 214,993 | $ 203,164 |
Actual Ratio (as a percent) | 10.99% | 11.40% |
Required for Capital Adequacy Purposes Amount | $ 88,021 | $ 80,209 |
Required for Capital Adequacy Purposes Ratio (as a percent) | 4.50% | 4.50% |
To be Well Capitalized Under Prompt Corrective Action Regulations Amount | $ 127,141 | $ 115,858 |
To be Well Capitalized Under Prompt Corrective Action Regulations Ratio (as a percent) | 6.50% | 6.50% |
Tier 1 capital to risk-weighted assets | ||
Actual Amount | $ 214,993 | $ 203,164 |
Actual Ratio (as a percent) | 0.1099 | 0.1140 |
Required for Capital Adequacy Purposes Amount | $ 117,361 | $ 106,945 |
Required for Capital Adequacy Purposes Amount (as a percent) | 0.060 | 0.060 |
To be Well Capitalized Under Prompt Corrective Action Regulations Amount | $ 156,482 | $ 142,594 |
To be Well Capitalized Under Prompt Corrective Action Regulations Ratio (as a percent) | 0.080 | 0.080 |
Total capital to risk-weighted assets | ||
Actual Amount | $ 229,777 | $ 217,215 |
Actual Ratio (as a percent) | 0.1175 | 0.1219 |
Required for Capital Adequacy Purposes Amount | $ 156,482 | $ 142,594 |
Required for Capital Adequacy Purposes Ratio (as a percent) | 0.080 | 0.080 |
To be Well Capitalized Under Prompt Corrective Action Regulations Amount | $ 195,602 | $ 178,242 |
To be Well Capitalized Under Prompt Corrective Action Regulations Ratio (as a percent) | 0.100 | 0.100 |
Tier 1 capital to average assets | ||
Actual Amount | $ 214,993 | $ 203,164 |
Actual Ratio (as a percent) | 0.0865 | 0.1005 |
Required for Capital Adequacy Purposes Amount | $ 99,469 | $ 80,887 |
Required for Capital Adequacy Purposes Ratio (as a percent) | 0.040 | 0.040 |
To be Well Capitalized Under Prompt Corrective Action Regulations Amount | $ 124,336 | $ 101,108 |
Tier One Leverage Capital Required to be Well Capitalized to Average Assets | 0.050 | 0.050 |