Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Mar. 01, 2019 | Jun. 30, 2018 | |
Document And Entity Information | |||
Entity Registrant Name | Two River Bancorp | ||
Entity Central Index Key | 0001343034 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Accelerated Filer | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Common Stock, Shares Outstanding (in shares) | 8,659,296 | ||
Entity Public Float | $ 138,364,363 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2018 | ||
Document Fiscal Year Focus | 2018 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
ASSETS | ||
Cash and due from banks | $ 24,067 | $ 29,575 |
Interest-bearing deposits in bank | 24,059 | 18,644 |
Cash and cash equivalents | 48,126 | 48,219 |
Securities available for sale, at fair value (amortized cost of $25,017 and $29,127 at December 31 2018 and December 31, 2017, respectively) | 24,407 | 28,684 |
Securities held to maturity, at amortized cost (fair value of $47,266 and $58,549 at December 31, 2018 and 2017, respectively) | 47,455 | 58,002 |
Equity securities, at fair value | 2,451 | 2,448 |
Restricted investments, at cost | 6,082 | 5,430 |
Loans held for sale | 1,496 | 2,581 |
Loans | 921,301 | 850,874 |
Allowance for loan losses | (11,398) | (10,668) |
Net Loans | 909,903 | 840,206 |
OREO | 585 | 0 |
Bank owned life insurance | 22,098 | 21,573 |
Premises and equipment, net | 5,917 | 6,239 |
Accrued interest receivable | 2,583 | 2,554 |
Goodwill | 18,109 | 18,109 |
Other assets | 7,207 | 5,753 |
Total Assets | 1,096,419 | 1,039,798 |
Deposits: | ||
Non-interest bearing | 176,655 | 167,297 |
Interest-bearing | 740,699 | 694,260 |
Total Deposits | 917,354 | 861,557 |
Securities sold under agreements to repurchase | 19,402 | 27,120 |
FHLB and other borrowings | 22,500 | 25,800 |
Subordinated debt | 9,923 | 9,888 |
Accrued interest payable | 119 | 70 |
Other liabilities | 10,623 | 8,792 |
Total Liabilities | 979,921 | 933,227 |
Shareholders’ Equity | ||
Preferred stock, no par value; 6,500,000 shares authorized; no shares issued and outstanding | 0 | 0 |
Common stock, no par value; 25,000,000 shares authorized; Issued – 8,935,437 and 8,782,124 at December 31, 2018 and 2017, respectively Outstanding – 8,606,992 and 8,470,030 at December 31, 2018 and 2017, respectively | 80,481 | 79,678 |
Retained earnings | 39,109 | 29,593 |
Treasury stock, at cost; 328,445 and 312,094 shares at December 31, 2018 and 2017, respectively | (2,647) | (2,396) |
Accumulated other comprehensive loss | (445) | (304) |
Total Shareholders’ Equity | 116,498 | 106,571 |
Total Liabilities and Shareholders’ Equity | $ 1,096,419 | $ 1,039,798 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Amortized Cost | $ 25,017 | $ 29,127 |
Securities held-to-maturity, fair value | $ 47,266 | $ 58,549 |
Preferred stock, par value (in dollars per share) | $ 0 | $ 0 |
Preferred stock, shares authorized (in shares) | 6,500,000 | 6,500,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0 | $ 0 |
Common stock, shares authorized (in shares) | 25,000,000 | 25,000,000 |
Common stock, shares issued (in shares) | 8,935,437 | 8,782,124 |
Common stock, shares outstanding (in shares) | 8,606,992 | 8,470,030 |
Treasury stock, shares (in shares) | 328,445 | 312,094 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Interest Income | |||
Loans, including fees | $ 41,726 | $ 35,801 | $ 32,798 |
Securities: | |||
Taxable | 1,175 | 988 | 776 |
Tax-exempt | 1,108 | 1,101 | 917 |
Interest-bearing deposits | 483 | 350 | 133 |
Total Interest Income | 44,492 | 38,240 | 34,624 |
Interest Expense | |||
Deposits | 7,154 | 4,363 | 3,829 |
Securities sold under agreements to repurchase | 58 | 66 | 61 |
FHLB and other borrowings | 494 | 620 | 618 |
Subordinated debt | 660 | 658 | 656 |
Total Interest Expense | 8,366 | 5,707 | 5,164 |
Net Interest Income | 36,126 | 32,533 | 29,460 |
Provision for Loan Losses | 775 | 1,530 | 515 |
Net Interest Income after Provision for Loan Losses | 35,351 | 31,003 | 28,945 |
Non-Interest Income | |||
Service fees on deposit accounts | 880 | 772 | 587 |
Mortgage banking | 1,288 | 1,583 | 1,162 |
Other loan fees | 902 | 588 | 610 |
Earnings from investment in bank owned life insurance | 525 | 544 | 477 |
Death benefit on bank owned life insurance | 0 | 0 | 862 |
Gain on sale of SBA loans | 1,197 | 1,052 | 868 |
Net gain on sale of securities | 0 | 0 | 72 |
Other income | 739 | 920 | 851 |
Total Non-Interest Income | 5,531 | 5,459 | 5,489 |
Non-Interest Expenses | |||
Salaries and employee benefits | 15,941 | 14,046 | 12,844 |
Occupancy and equipment | 4,147 | 4,241 | 4,117 |
Professional | 1,603 | 1,497 | 1,198 |
Insurance | 242 | 216 | 216 |
FDIC insurance and assessments | 497 | 467 | 412 |
Advertising | 360 | 450 | 415 |
Data processing | 738 | 553 | 554 |
Outside service fees | 325 | 473 | 500 |
Amortization of identifiable intangibles | 0 | 0 | 9 |
OREO expenses, impairments and sales, net | 5 | 48 | (274) |
Loan workout expenses | 144 | 233 | 73 |
Other operating | 1,684 | 1,718 | 1,411 |
Total Non-Interest Expenses | 25,686 | 23,942 | 21,475 |
Income before Income Taxes | 15,196 | 12,520 | 12,959 |
Income tax expense | 3,990 | 6,018 | 4,328 |
Net Income | $ 11,206 | $ 6,502 | $ 8,631 |
Earnings Per Common Share: | |||
Basic earnings per common share (in dollars per share) | $ 1.32 | $ 0.78 | $ 1.04 |
Diluted earnings per common share (in dollars per share) | $ 1.29 | $ 0.75 | $ 1.01 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 11,206 | $ 6,502 | $ 8,631 |
Unrealized holdings (losses) gains on securities available for sale, net of income tax (benefit) expense 2018: $(46), 2017: $56; 2016: $5 | (121) | 87 | 8 |
Other comprehensive (loss) income | (121) | 87 | 8 |
Total comprehensive income | $ 11,085 | $ 6,589 | $ 8,639 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | |||
Unrealized holdings gain (loss) on securities available for sale, net of income tax expense (benefit) | $ (46) | $ 56 | $ 5 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity - USD ($) $ in Thousands | Total | Preferred Stock | Common Stock | Retained Earnings | Treasury Stock | Accumulated Other Comprehensive Income (Loss) |
Balance, beginning of period at Dec. 31, 2015 | $ 93,002 | $ 0 | $ 72,890 | $ 22,759 | $ (2,248) | $ (399) |
Balance, beginning of period (in shares) at Dec. 31, 2015 | 7,929,196 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 8,631 | 8,631 | ||||
Other comprehensive income | 8 | 8 | ||||
Stock-based compensation expense | 231 | $ 231 | ||||
Cash dividends on common stock | (1,193) | (1,193) | ||||
Common stock dividend (in shares) | 399,554 | |||||
Common stock dividend | 0 | $ 5,750 | (5,750) | |||
Options exercised (in shares) | 27,527 | |||||
Options exercised | 104 | $ 104 | ||||
Tax benefit related to stock compensation | 25 | $ 25 | ||||
Common stock repurchased (in shares) | (13,232) | |||||
Common stock repurchased | (148) | |||||
Restricted stock and other awards (in shares) | 17,000 | |||||
Employee stock purchase program (in shares) | 5,397 | |||||
Employee stock purchase program | 56 | $ 56 | ||||
Balance, end of period at Dec. 31, 2016 | 100,716 | 0 | $ 79,056 | 24,447 | (2,396) | (391) |
Balance, end of period (in shares) at Dec. 31, 2016 | 8,365,442 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 6,502 | 6,502 | ||||
Other comprehensive income | 87 | 87 | ||||
Stock-based compensation expense | 279 | $ 279 | ||||
Cash dividends on common stock | (1,415) | (1,415) | ||||
Common stock dividend (in shares) | (1,069) | |||||
Options exercised (in shares) | 68,403 | |||||
Options exercised | 276 | $ 276 | ||||
Tax benefit related to stock compensation | 59 | 59 | ||||
Restricted stock and other awards (in shares) | 33,333 | |||||
Employee stock purchase program (in shares) | 3,921 | |||||
Employee stock purchase program | 67 | $ 67 | ||||
Balance, end of period at Dec. 31, 2017 | 106,571 | $ 0 | $ 79,678 | 29,593 | (2,396) | (304) |
Balance, end of period (in shares) at Dec. 31, 2017 | 8,470,030 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
AOCI reclassification due to adoption of ASU 2016-01 | (39) | 39 | ||||
Net income | 11,206 | 11,206 | ||||
Other comprehensive income | (121) | (121) | ||||
AOCI reclassification related to Tax Reform | 59 | 59 | (59) | |||
Stock-based compensation expense | 317 | $ 317 | ||||
Cash dividends on common stock | (1,710) | (1,710) | ||||
Options exercised (in shares) | 115,824 | |||||
Options exercised | $ 423 | $ 423 | ||||
Common stock repurchased (in shares) | (16,351) | (16,351) | ||||
Common stock repurchased | $ (251) | (251) | ||||
Restricted stock and other awards (in shares) | 33,950 | |||||
Employee stock purchase program (in shares) | 3,539 | |||||
Employee stock purchase program | 63 | $ 63 | ||||
Balance, end of period at Dec. 31, 2018 | $ 116,498 | $ 80,481 | $ 39,109 | $ (2,647) | $ (445) | |
Balance, end of period (in shares) at Dec. 31, 2018 | 8,606,992 |
Consolidated Statements of Sh_2
Consolidated Statements of Shareholders' Equity (Parenthetical) - $ / shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash dividends, per share (in dollars per share) | $ 0.20 | $ 0.17 | $ 0.14 |
Common Stock Dividends, Percentage | 5.00% |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash Flows from Operating Activities | |||
Net income | $ 11,206,000 | $ 6,502,000 | $ 8,631,000 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 691,000 | 765,000 | 780,000 |
Provision for Loan Losses | 775,000 | 1,530,000 | 515,000 |
Intangible amortization | 0 | 0 | 9,000 |
Amortization of subordinated debt issuance costs | 35,000 | 33,000 | 31,000 |
Net amortization of securities premiums and discounts | 776,000 | 828,000 | 714,000 |
Deferred income taxes | (429,000) | 1,061,000 | (463,000) |
Earnings from investment in bank owned life insurance | (525,000) | (544,000) | (477,000) |
Proceeds from sale of mortgage loans held for sale | 55,581,000 | 72,190,000 | 62,059,000 |
Origination of mortgage loans held for sale | (54,658,000) | (69,480,000) | (60,882,000) |
Gain on sale of mortgage loans held for sale | (919,000) | (1,278,000) | (1,059,000) |
Gain on sale of loans transferred from held for investment to held for sale | (200,000) | (177,000) | 0 |
Net realized loss (gain) on sale of OREO | 0 | 17,000 | 45,000 |
Impairment on OREO | 0 | 26,000 | 0 |
Stock-based compensation expense | 317,000 | 279,000 | 231,000 |
Net realized gain on sale of securities held to maturity | 0 | 0 | (72,000) |
Death benefit on bank owned life insurance | 0 | 0 | (862,000) |
Proceeds from sale of SBA loans held for sale | 3,364,000 | 9,744,000 | 7,860,000 |
Origination of SBA loans held for sale | (1,086,000) | (8,168,000) | (8,597,000) |
Gain on sale of SBA loans held for sale | (1,197,000) | (1,052,000) | (868,000) |
Unrealized loss on equity securities | 53,000 | 0 | 0 |
Decrease (increase) in assets: | |||
Accrued interest receivable | (29,000) | (320,000) | (322,000) |
Other assets | (1,111,000) | (205,000) | 164,000 |
Increase (decrease) in liabilities: | |||
Accrued interest payable | 49,000 | (30,000) | (18,000) |
Other liabilities | 1,831,000 | 1,034,000 | 1,487,000 |
Net Cash Provided by Operating Activities | 14,524,000 | 12,755,000 | 8,906,000 |
Cash Flows from Investing Activities | |||
Purchase of securities available for sale | (4,245,000) | (2,500,000) | (8,038,000) |
Purchase of securities held to maturity | (5,035,000) | (15,458,000) | (25,213,000) |
Proceeds from repayments, calls and maturities of securities available for sale | 8,107,000 | 5,599,000 | 6,781,000 |
Proceeds from repayments, calls and maturities of securities held to maturity | 15,130,000 | 14,847,000 | 9,155,000 |
Proceeds from sales of securities held to maturity | 0 | 0 | 1,076,000 |
Proceeds from sale of loans transferred from held for investment to held for sale | 10,030,000 | 8,357,000 | 0 |
Net increase in loans | (80,887,000) | (106,389,000) | (59,605,000) |
Purchase of premises and equipment | (369,000) | (2,342,000) | (359,000) |
Proceeds from sale of premises and equipment | 0 | 0 | 0 |
Purchase of restricted investments, net | (652,000) | (625,000) | (1,209,000) |
Proceeds from the sale of OREO | 0 | 216,000 | 107,000 |
Purchase of bank owned life insurance | 0 | 0 | (3,918,000) |
Proceeds from death benefit on bank owned life insurance | 0 | 0 | 1,522,000 |
Net Cash Used in Investing Activities | (57,921,000) | (98,295,000) | (79,701,000) |
Cash Flows from Financing Activities | |||
Net increase in deposits | 55,797,000 | 84,990,000 | 68,131,000 |
Net (decrease) increase in securities sold under agreements to repurchase | (7,718,000) | 7,205,000 | 370,000 |
Proceeds from FHLB and other borrowings | 0 | 12,500,000 | 13,000,000 |
Repayment of FHLB and other borrowings | (3,300,000) | (12,000,000) | (14,200,000) |
Cash dividends paid - common stock | (1,710,000) | (1,415,000) | (1,193,000) |
Proceeds from employee stock purchase plan | 63,000 | 67,000 | 56,000 |
Proceeds from exercise of stock options | 423,000 | 275,900 | 104,100 |
Common stock repurchased | (251,000) | 0 | (148,000) |
Tax benefit related to stock compensation | 0 | 59,000 | 25,000 |
Net Cash Provided by Financing Activities | 43,304,000 | 91,682,000 | 66,145,000 |
Net (Decrease) Increase in Cash and Cash Equivalents | (93,000) | 6,142,000 | (4,650,000) |
Cash and Cash Equivalents – Beginning | 48,219,000 | 42,077,000 | 46,727,000 |
Cash and Cash Equivalents – Ending | 48,126,000 | 48,219,000 | 42,077,000 |
Supplementary cash flow information: | |||
Interest paid | 8,317,000 | 5,737,000 | 5,182,000 |
Income taxes paid | 4,854,000 | 5,217,000 | 4,338,000 |
Supplementary schedule of non-cash activities: | |||
Transfer of loans held for investment to loans held for sale | 9,830,000 | 8,180,000 | 0 |
OREO acquired in settlement of loans | $ 585,000 | $ 0 | $ 0 |
Revenue Recognition
Revenue Recognition | 12 Months Ended |
Dec. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition On January 1, 2018, the Company adopted ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) , and all subsequent ASUs that modified Topic 606. As stated in Note 1, New Accounting Standards , the implementation of the new standard did not have a material impact on the measurement or recognition of revenue; as such, a cumulative effect adjustment to opening retained earnings was not deemed necessary. Results for reporting periods beginning after January 1, 2018 are presented under Topic 606, while prior period amounts were not adjusted and continue to be reported in accordance with our historic accounting under Topic 605. Topic 606 does not apply to revenue associated with financial instruments, including revenue from loans and securities. In addition, certain non-interest income streams such as fees associated with mortgage servicing rights, financial guarantees, derivatives, and certain credit card fees are also not in scope of the new guidance. Topic 606 is applicable to non-interest revenue streams, such as deposit related fees, interchange fees, merchant income, and brokerage and investment advisory service commissions. However, the recognition of these revenue streams did not change significantly upon adoption of Topic 606. Substantially all of the Company’s revenue is generated from contracts with customers. Non-interest revenue streams in-scope of Topic 606 are discussed below. Service Fees on Deposit Accounts Service charges on deposit accounts consist of account analysis fees (i.e., net fees earned on analyzed business and public checking accounts), monthly service fees, check orders, and other deposit account related fees. The Company’s performance obligation for account analysis fees and monthly service fees is generally satisfied, and the related revenue recognized, over the period in which the service is provided. Check orders and other deposit account related fees are largely transactional based, and therefore, the Company’s performance obligation is satisfied, and related revenue recognized, at a point in time. Payment for service charges on deposit accounts is primarily received immediately or in the following month through a direct charge to customers’ accounts. Other Income Other non-interest income consists of other recurring revenue streams such as debit card income, credit card income, ATM fees, merchant services income, commissions from sales of mutual funds and other investments provided through a third party brokerage and investment advisory service firm, safe deposit box rental fees, and other miscellaneous revenue streams. Debit card income is primarily comprised of interchange fees earned whenever the Company’s debit cards are processed through card payment networks, such as MasterCard. Credit card income is realized through a third party provider who issues credit cards as private label in the Company's name. ATM fees are primarily generated when a non-Company cardholder uses a Company ATM. The income is primarily comprised as a percentage of interchange fees earned whenever the issuer's card is processed through card payment networks, such as Visa and/or American Express. Merchant services income is realized through a third party service provider who is contracted by the Bank under a referral arrangement. Such fees represent fees charged to merchants to process their debit card transactions, in addition to account management fees. Other service charges include revenue from processing wire transfers, cashier’s checks, and other services. The Company’s performance obligation for fees, exchange, and other service charges are largely satisfied, and related revenue recognized, when the services are rendered or upon completion. Payment is typically received immediately or in the following month. Commissions received from the third party brokerage and investment advisory service firm from the sale of mutual funds and other investments are recognized when the firm has satisfied its performance obligation. The Company also receives periodic service fees (i.e., trailers) from this advisory service firm typically based on a percentage of net asset value. Trailer revenue is recorded over time, usually monthly or quarterly, as net asset value is determined. Safe deposit box rental fees are charged to the customer on an annual basis and recognized upon receipt of payment. The Company determined that since rentals and renewals occur fairly consistently over time, revenue is recognized on a basis consistent with the duration of the performance obligation. The following presents non-interest income, segregated by revenue streams in-scope and out-of-scope of Topic 606, for the years ended December 31, 2018 and 2017 . Twelve Months Ended December 31, 2018 2017 2016 (Dollars in Thousands) Non-Interest Income In-scope of Topic 606 Service fees on deposit accounts $ 880 $ 772 $ 587 Other income 549 746 693 Non-Interest Income (in-scope of Topic 606) 1,429 1,518 1,280 Non-Interest Income (out-of-scope of Topic 606) 4,102 3,941 4,209 Total Non-Interest Income $ 5,531 $ 5,459 $ 5,489 Contract Balances A contract asset balance occurs when an entity performs a service for a customer before the customer pays consideration (resulting in a contract receivable) or before payment is due (resulting in a contract asset). A contract liability balance is an entity’s obligation to transfer a service to a customer for which the entity has already received payment (or payment is due) from the customer. The Company’s non-interest revenue streams are largely based on transactional activity, or standard month-end revenue accruals. Consideration is often received immediately or shortly after the Company satisfies its performance obligation and revenue is recognized. The Company does not typically enter into long-term revenue contracts with customers, and therefore, does not experience significant contract balances. The Company did not have any significant contract balances at December 31, 2018 , 2017 and 2016 . Contract Acquisition Costs In connection with the adoption of Topic 606, an entity is required to capitalize, and subsequently amortize into expense, certain incremental costs of obtaining a contract with a customer if these costs are expected to be recovered. The incremental costs of obtaining a contract are those costs that an entity incurs to obtain a contract with a customer that it would not have incurred if the contract had not been obtained (for example, sales commission). The Company utilizes the practical expedient which allows entities to immediately expense contract acquisition costs when the asset that would have resulted from capitalizing these costs would have been amortized in one year or less. Upon adoption of Topic 606, the Company did not capitalize any contract acquisition cost. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies A. Organization and Basis of Presentation The accompanying consolidated financial statements include the accounts of Two River Bancorp (the “Company”), a bank holding company, and its wholly-owned subsidiary, Two River Community Bank (“the Bank” or “Two River”) and the Bank’s wholly-owned subsidiary, TRCB Investment Corporation. All inter-company balances and transactions have been eliminated in the consolidated financial statements. B. Nature of Operations Two River Bancorp is a bank holding company whose principal activity is the ownership of Two River Community Bank. Through its banking subsidiary, the Company provides banking services to small and medium-sized businesses, professionals and individual consumers primarily in the Monmouth, Middlesex, Union and Ocean Counties, located in Central and Northern New Jersey. The Company competes with other banking and financial institutions in its market communities. The Company and its bank subsidiary are subject to regulations of certain state and federal agencies and, accordingly, they are periodically examined by those regulatory authorities. As a consequence of the extensive regulation of commercial banking activities, the Company’s and the Bank’s businesses are susceptible to being affected by state and federal legislation and regulations. C. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The principal material estimates that are particularly susceptible to significant change in the near term related to: the allowance for loan losses, the potential impairment of goodwill, the valuation of deferred tax assets, valuation of other real estate owned and the determination of other-than-temporary impairment on securities. D. Significant Concentrations of Credit Risk Most of the Company’s activities are with customers located within Monmouth, Middlesex, Union and Ocean Counties of New Jersey. Note 3 discusses the types of securities that the Company invests in. Note 4 discusses the types of lending that the Company engages in. Although the Company actively manages the diversification of its loan portfolio, a substantial portion of its debtors’ ability to honor their contracts is dependent upon the strength of the local economy. The loan portfolio includes commercial real estate, which is comprised of owner occupied and investment real estate, including general office, medical, manufacturing and retail space. Construction loans, short-term in nature, comprise another portion of the portfolio, along with commercial and industrial loans. The latter includes lines of credit and equipment loans. From time to time, the Company may purchase or sell an interest in a loan from or to another lender (participation loan) in order to manage its portfolio risk. Loans purchased by the Company are typically located in New Jersey and meet the Company’s own independent underwriting guidelines. The Company does not have any significant concentrations in any one industry or customer. E. Comprehensive Income Comprehensive income consists of net income and other comprehensive income (loss). Other comprehensive income (loss) includes unrealized gains and losses on securities available for sale and unrealized losses related to factors other than credit on debt securities which have been determined to be other-than-temporarily impaired. F. Statement of Cash Flows For purposes of reporting cash flows, cash and cash equivalents include cash on hand, amounts due from banks, interest-bearing deposits in banks, and Federal funds sold. Interest-bearing deposits are due from the Federal Reserve Bank of New York. Generally, Federal funds are purchased and sold for one-day periods. G. Securities Securities classified as available for sale are those securities that the Company intends to hold for an indefinite period of time but not necessarily to maturity. Securities available for sale are carried at fair value. Any decision to sell a security classified as available for sale would be based on various factors, including significant movement in interest rates, changes in maturity mix of the Company’s assets and liabilities, liquidity needs, regulatory capital considerations and other similar factors. Unrealized gains or losses are reported as increases or decreases in other comprehensive income (loss), net of the related deferred tax effect. Realized gains or losses, determined on the basis of the cost of the specific securities sold, are included in earnings. Premiums and discounts are recognized in interest income using the interest method over the terms of the securities. Gains and losses on the sale of securities available for sale are recorded on the trade date and are determined using the specific identification method. Securities classified as held to maturity are those securities the Company has both the intent and ability to hold to maturity regardless of changes in market conditions, liquidity needs or changes in general economic conditions. These securities are carried at cost adjusted for the amortization of premium and accretion of discount, computed by the interest method over the terms of the securities. Management determines the appropriate classification of debt securities at the time of purchase and re-evaluates such designation as of each balance sheet date. Other-than-temporary accounting guidance specifies that (a) if a company does not have the intent to sell a debt security prior to recovery and (b) it is more likely than not that it will not have to sell the debt security prior to recovery, the security would not be considered other-than-temporary impaired unless there is a credit loss. When an entity does not intend to sell the security, and it is more likely than not, the entity will not have to sell the security before recovery of its cost basis, it will recognize the credit component of an other-than-temporary impairment of a debt security in earnings and the remaining portion in other comprehensive income (loss). For held to maturity debt securities, the amount of an other-than-temporary impairment recorded in other comprehensive income (loss) for the noncredit portion of a previous other-than-temporary impairment should be amortized prospectively over the remaining life of the security on the basis of the timing of future cash flows of the security. The Company has equity securities, which consists solely of the CRA Mutual Fund. Net unrealized gains and losses are recognized through earnings beginning January 1, 2018 after the adoption of ASU 2016-01. H. Restricted Investments Restricted investments, which represents the required investment in the common stock of correspondent banks, is carried at cost and as of December 31, 2018 and 2017 , consists of the common stock of the Federal Home Loan Bank of New York (“FHLB”) and Atlantic Community Bancshares, Inc. (“ACBI”), the parent company of Atlantic Community Bankers Bank. Federal law requires a member institution of the FHLB to hold stock of its district FHLB according to a predetermined formula. The recorded investment in FHLB common stock was $4,507,600 and $3,855,800 at December 31, 2018 and 2017 , respectively. The recorded investment in ACBI common stock was $75,000 at December 31, 2018 and 2017 . Restricted investments also include the Solomon Hess SBA Loan Fund, utilized for the purpose of the Bank satisfying its CRA lending requirements. As this fund operates as a private fund, shares in the Fund are not publicly traded and therefore have no readily determinable market value. An investor can have their interest in the Fund redeemed for the balance of their capital account at any quarter end assuming they give the Fund 60 days’ notice. This fund is an equity security without a readily determinable fair value that we have elected to record at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for an identical or similar investment of the same issuer in accordance with ASU 2016-01. The carrying value is $1,500,000 at December 31, 2018 and 2017 . Management evaluates the restricted investments for impairment in accordance with U.S. generally accepted accounting principles. Management’s determination of whether these investments are impaired is based on their assessment of the ultimate recoverability of their cost rather than by recognizing temporary declines in value. Management believes no impairment charge is necessary related to restricted investments as of December 31, 2018 . I. Loans Receivable and Loans Held for Sale Loans receivable, which management has the intent and ability to hold for the foreseeable future or until maturity or payoff are stated at their outstanding unpaid principal balances, net of an allowance for loan losses and any deferred fees or costs. Interest income is accrued on the unpaid principal balance. Loan origination fees, net of certain direct origination costs, are deferred and recognized as an adjustment of the yield (interest income) of the related loans. The Company is generally amortizing these amounts over the contractual life of the loan. Loans held for sale are designated at time of origination. They generally consist of newly originated fixed rate residential loans and salable SBA loans and are recorded at the lower of aggregate cost or estimated fair value in the aggregate. The Company typically retains adjustable-rate mortgage (“ARM”) loans in its portfolio, however occasionally, the Company may elect to sell a small pool of these loans as part of its strategy to manage interest rate risk or as a secondary source of liquidity. The Company transferred $9.8 million from held for investment to held for sale in 2018 , while $8.2 million such loans were transferred in 2017 . The Company did not transfer any loans from held for investment to held for sale in 2016. Gains from such sales were $200,000 , $177,000 , and $0 for the years ended December 31, 2018, 2017 and 2016, respectively. Transfers from held for investment are infrequent and occur at lower of cost or fair value, less costs to sell. Gains are recognized on a settlement-date basis and are determined by the difference between the net sales proceeds and the carrying value of the loans, including any net deferred fees or costs. Depending on the type of loan sold, servicing may or may not be retained. The loans receivable portfolio is segmented into five categories, those being a) Commercial and industrial, b) Real estate-construction (consisting of both residential and commercial construction), c) Real estate-commercial, d) Real estate-residential, and e) Consumer. For all classes of loans receivable, the accrual of interest is discontinued when the contractual payment of principal or interest has become 90 days past due or management has serious doubts about further collectability of principal or interest, even though the loan is currently performing. A loan may remain on accrual status if it is in the process of collection and is either guaranteed or well secured. When a loan is placed on nonaccrual status, unpaid interest previously accrued on these loans is reversed from income. Interest received on nonaccrual loans, including impaired loans, generally is either applied against principal or reported as interest income, according to management’s judgment as to the collectability of principal. Generally, loans are restored to accrual status when the obligation is brought current, has performed in accordance with the contractual terms for a reasonable period of time (generally six months) and the ultimate collectability of the total contractual principal and interest is no longer in doubt. The past due status of all classes of loans receivable is determined based on contractual due dates for loan payments. J. Allowance for Loan Losses The allowance for credit losses consists of the allowance for loan losses and the reserve for unfunded lending commitments. The allowance for loan losses represents management’s estimate of losses inherent in the loan portfolio as of the balance sheet date and is recorded as a reduction to loans. The reserve for unfunded lending commitments represents management’s estimate of losses inherent in its unfunded loan commitments and is recorded in other liabilities on the consolidated balance sheet, which at December 31, 2018 and 2017 , the Company had no such reserves. The allowance for loan losses is increased by the provision for loan losses, and decreased by charge-offs, net of recoveries. Loans deemed to be uncollectable are charged against the allowance for loan losses, and subsequent recoveries, if any, are credited to the allowance. All, or part, of the principal balance of loans receivable are charged off to the allowance as soon as it is determined that the repayment of all, or part, of the principal balance is highly unlikely. The allowance for loan losses is maintained at a level considered adequate to provide for losses that can be reasonably anticipated. Management performs a monthly evaluation of the adequacy of the allowance. The allowance is based on the Company’s past loan loss experience, known and inherent risks in the portfolio, adverse situations that may affect the borrower’s ability to repay, the estimated value of any underlying collateral, composition of the loan portfolio, current economic conditions and other relevant factors. This evaluation is inherently subjective as it requires material estimates that may be susceptible to significant revision as more information becomes available. The allowance consists of specific, general and unallocated components. For loans that are classified as impaired, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan is lower than the carrying value of the loan. The specific component relates to loans that are classified as impaired. When a loan is impaired, there are three acceptable methods under ASC 310-10-35 for measuring the impairment: 1. The loan's observable market price; 2. The fair value of the underlying collateral; or 3. The present value (PV) of expected future cash flows. Loans that are considered “collateral-dependent” should be evaluated under the “Fair market value of collateral.” Loans that are still expected to be supported by repayment from the borrower should be evaluated under the “Present value of future cash flows.” For the most part, the Company measures impairment under the “Fair market value of collateral” for any loan that would rely on the value of collateral for recovery in the event of default. The individual impairment analysis for each loan is clearly documented as to the chosen valuation method. The general component covers pools of loans by loan class including commercial and industrial, real estate-construction and real estate-commercial not considered impaired as well as smaller balance homogeneous loans such as real estate-residential and consumer. These pools of loans are evaluated for loss exposure based upon historical loss rates for each of these categories of loans, adjusted for qualitative factors. These qualitative risk factors include: 1. Changes in lending policy and procedures, including changes in underwriting standards and collection practices not previously considered in estimating credit losses. 2. Changes in relevant economic and business conditions. 3. Changes in nature and volume of the loan portfolio and in the terms of loans. 4. Changes in experience, ability and depth of lending management and staff. 5. Changes in the volume and severity of past due loans, the volume of non-accrual loans and the volume and severity of adversely classified loans. 6. Changes in the quality of the loan review system. 7. Changes in the value of underlying collateral for collateral-dependent loans. 8. The existence and effect of any concentration of credit and changes in the level of such concentrations. 9. The effect of other external forces such as competition, legal and regulatory requirements on the level of estimated credit losses in the existing portfolio. Each factor is assigned a risk value to reflect low, moderate or high risk assessment levels based on management’s best judgment using current market, macro and other relevant information available at the time of the evaluation. Adjustments to the factors are supported through documentation in each factor and accompany the allowance for loan loss calculation. During the fourth quarter of 2018, Management employed a more refined estimation in determining the risk levels assigned to each of its qualitative factors in the allowance for loan losses. While this did not result in a significant change to the allowance for loan losses as a whole, it did result increasing or decreasing the provision for certain loan categories that the Company either had experienced more or less historical net charge-offs. An unallocated component is maintained to cover uncertainties that could affect management’s estimate of probable losses. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating specific and general losses in the portfolio. The Company engages in a variety of lending activities, including commercial and industrial, real estate-commercial, real estate-construction, real estate-residential and consumer loans. The Company focuses its lending activities on individuals, professionals along with small to medium sized businesses. The Company originates commercial business loans to professionals, sole proprietorships and small businesses in our market areas. We extend commercial business loans on a secured and unsecured basis. Secured commercial loans are generally collateralized by residential and nonresidential real estate, marketable securities, accounts receivable, inventory, industrial/commercial machinery and equipment and furniture and fixtures. To further enhance our security position, we generally require personal guarantees of the principal owners of the entities to which we extend credit. These loans are made on both lines of credit and fixed-term basis typically ranging from one to five years in duration. When making commercial business loans, we consider the financial statements and/or tax returns of the borrower, the borrower’s payment history along with the principal owners’ payment history, the debt service capabilities of the borrower, the projected cash flows of the business, and the value of the collateral and the financial strength of the guarantor. Commercial real estate loans are made to local commercial, retail and professional firms and individuals for the acquisition of new property or the refinancing of existing property. These loans are typically related to commercial businesses and secured by the underlying real estate used in these businesses or real property of the principals. Commercial real estate loans typically require a loan to value ratio of not greater than 75% . These loans are generally offered on a fixed or variable rate basis, subject to rate re-adjustments every five years and amortization schedules ranging from 5 to 25 . Commercial loans are often larger and may involve greater risks than other types of lending. Because payments of such loans are often dependent on the successful operation of the business involved, repayment of such loans may be more sensitive than other types of loans and are subject to adverse conditions in the real estate market or the general economy. We are also involved with off-balance sheet financial instruments, which include collateralized commercial and standby letters of credit. We seek to minimize these risks through our underwriting guidelines and prudent risk management techniques. Any collateral securing such loans may depreciate over time, may be difficult to appraise and may fluctuate in value. Environmental surveys and inspections are obtained when circumstances suggest that the possibility of the presence of hazardous materials. There can be no assurances, however, of success in the efforts to minimize these risks. The Company is an approved Preferred Lender by the Small Business Administration (“SBA”), which allows the Company delegated authority to approve and close SBA loans up to $5.0 million . The Company maintains prudent credit risk management to monitor and evaluate the value of real estate and other collateral used to secure SBA loans. All SBA loans are originated in compliance with all applicable federal lending regulations, including but not limited to the Equal Credit Opportunity Act. The Bank currently participates in SBA’s 7a and 504 loan programs, which typically provide guarantees up to 75% per loan. The Bank typically sells the guaranteed portion of SBA loans and retains the unguaranteed portion ("retained interest"). A portion of the premium on the sale of SBA loans is recognized as gain on sale of loans at the time of the sale by allocating the carrying amount between the asset sold and the retained interest, including servicing assets, based on their relative fair values. The remaining portion of the premium is recorded as a discount on the remaining life of the loan as an adjustment to yield. The retained interest, net of any discount, is included in loans in the accompanying consolidated balance sheets. Servicing assets are amortized in proportion to, and over the period of, the estimated net servicing income or net servicing loss and measured for impairment based on fair value at each reporting date. The amortization of the servicing rights is analyzed periodically and is adjusted to reflect changes in prepayment rates and other estimates. Serviced loans sold to others is not included in the balance sheets. The unpaid principal balances of loans serviced for others were $41.5 million and $32.9 million at December 31, 2018 and 2017, respectively. Income (losses) and fees collected for servicing are included within Other Loan Fees on the statements of operations, and totaled $220,000 , $172,000 , and $100,000 for the years ended December 31, 2018, 2017 and 2016, respectively. The servicing assets recorded as of December 31, 2018 and 2017 are not material. Our philosophy remains to be prudent and focused on the cash flow of the businesses and financial strength of the guarantors. The Company originates fixed-rate and adjustable-rate loans to individuals and builders to finance the construction of residential dwellings. We also originate construction loans for commercial development projects, including apartment buildings, restaurants, shopping centers and owner-occupied properties used for businesses. Our construction loans generally provide for the payment of interest only during the construction phase which is typically twelve months for residential properties and twelve to eighteen months for commercial properties. At the end of the construction phase, the loan is either converted to a permanent mortgage loan or paid off. Before making a commitment to fund a construction loan, we require an appraisal and an environmental analysis of the property performed by a bank approved independent licensed appraiser and environmental consultant, an inspection of the property before disbursement of funds during the stages of the construction process, and approval from an identified source for the permanent takeout. Additionally, the borrower must demonstrate the ability to service the debt during the construction term. The Company offers a full range of residential real estate and consumer loans. These loans consist of residential mortgages, home equity lines of credit, equity loans, personal loans, automobile loans and overdraft protection. We do not originate subprime or negative amortization loans. Each residential mortgage loan is evidenced by a promissory note secured by a mortgage or deed of trust creating a first lien on one-to-four family residential property. Residential real estate properties underlying residential mortgage loans consist of single-family detached units, individual condominium units, two-to-four family dwellings units and townhouses. Our home equity revolving lines of credit come with a floating interest rate tied to the prime rate. Lines of credit are available to qualified applicants in amounts up to $350,000 for up to 15 years years. We also offer fixed rate home equity loans in amounts up to $350,000 for a term of up to 15 years. Credit is based on the income and cash flow of the individual borrowers, real estate collateral supporting the mortgage debt and past credit history. Consumer loans may entail greater risk than residential mortgage loans, particularly in the case of consumer loans that are unsecured or secured by assets that depreciate in value rapidly. In such cases, repossessed collateral for a defaulted consumer loan may not provide an adequate source of repayment for the outstanding loan and the remaining deficiency often does not warrant further substantial collection efforts against the borrower. In addition, consumer loan collections depend on the borrower’s continuing financial stability, and therefore are more likely to be adversely affected by job loss, divorce, illness or personal bankruptcy. Furthermore, the application of various federal and state laws, including bankruptcy and insolvency laws, may limit the amount that can be recovered on such loans. A loan is considered impaired when it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record and the amount of the shortfall in relation to the principal and interest owed. Impairment is measured on a loan by loan basis for commercial and industrial, real estate-commercial, real estate-construction, real estate-residential and consumer loans by either the present value of expected future cash flows discounted at the loan’s effective interest rate or the fair value of the collateral if the loan is collateral dependent. An allowance for loan losses is established for an impaired loan if its carrying value exceeds its estimated fair value. The estimated fair values of substantially all of the Company’s impaired loans are measured based on the estimated fair value of the loan’s collateral. For commercial loans secured by real estate, estimated fair values are determined primarily through third-party appraisals. When a real estate secured loan becomes impaired, a decision is made regarding whether an updated certified appraisal of the real estate is necessary. This decision is based on various considerations, including the age of the most recent appraisal, the loan-to-value ratio based on the original appraisal and the condition of the property. Appraised values are discounted to arrive at the estimated selling price of the collateral, which is considered to be the estimated fair value. The discounts also include estimated costs to sell the property. For commercial loans secured by non-real estate collateral, such as accounts receivable, inventory and equipment, estimated fair values are determined based on the borrower’s financial statements, inventory reports, accounts receivable aging or equipment appraisals or invoices. Indications of value from these sources are generally discounted based on the age of the financial information or the quality of the assets. Loans whose terms are modified are classified as troubled debt restructurings (“TDRs”) if the Company grants such borrowers concessions and it is deemed that those borrowers are experiencing financial difficulty. Concessions granted under a TDR generally involve a temporary reduction in interest rate or a modification of a loan’s amortization schedule. Non-accrual TDRs are restored to accrual status if principal and interest payments, under the modified terms, are current for six consecutive months after the modification is in place. Loans classified as TDRs, including those restored to accrual status, are designated as impaired. The Company’s TDR modifications are made on terms typically up to 12 months in order to aggressively monitor and track performance. The short-term modifications performances are monitored for continued payment performance for an additional period of time after the expiration of the concession. Balance reductions and annualized loss rates are also important metrics that are monitored. The main objective of the modification programs is to reduce the payment burden for the borrower and to deleverage the Company’s exposure. The allowance calculation methodology includes further segregation of loan classes into risk rating categories. The borrower’s overall financial condition, repayment sources, guarantors and value of collateral, if appropriate, are evaluated annually for commercial loans or when credit deficiencies arise, such as delinquent loan payments, for commercial and consumer loans. Credit quality risk ratings include regulatory classifications of special mention, substandard, doubtful and loss. Loans classified special mention have potential weaknesses that deserve management’s close attention. If uncorrected, the potential weaknesses may result in deterioration of the repayment prospects. Loans classified substandard have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They include loans that are inadequately protected by the current sound net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans classified doubtful have all the weaknesses inherent in loans classified substandard with the added characteristics that collection or liquidation in full, on the basis of current conditions and facts, is highly improbable. Loans classified as a loss are considered uncollectable and are charged to the allowance for loan losses. Loans not classified are rated pass. In addition, federal and state regulatory agencies, as an integral part of their examination process, periodically review the Company’s allowance for loan losses and may require the Company to recognize additions to the allowance based on their judgments about information available to them at the time of their examination, which may not be currently available to management. Based on management’s comprehensive analysis of the loan portfolio, management believes the current level of the allowance for loan losses is adequate. K. Transfers of Financial Assets Transfers of financial assets, including sale of loans and loan participation sales, are accounted for as sales, when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when (1) the assets have been isolated from the Company, (2) the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets and (3) the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity. L. Other Real Estate Owned Other Real Estate Owned (“OREO”) includes real estate acquired through foreclosure or by deed in lieu of foreclosure. OREO is initially recorded at fair value less cost to sell at the date of foreclosure, establishing a new cost basis. Any write-downs based on fair value less costs to sell at the date of foreclosure are charged to the allowance for loan losses. If at the time of foreclosure, the fair value less costs to sell is greater than the loan balance, the resulting gain is recognized at the time of foreclosure unless there has been a |
Securities
Securities | 12 Months Ended |
Dec. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Securities | Securities The amortized cost, gross unrealized gains and losses, and fair values of the Company’s securities are summarized as follows: December 31, 2018 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value (In Thousands) Securities available for sale: U.S. Government agency securities $ 11,800 $ 5 $ (170 ) $ 11,635 Municipal securities 487 — — 487 U.S. Government-sponsored enterprises (“GSE”) – residential mortgage-backed securities 6,131 1 (185 ) 5,947 U.S. Government collateralized residential mortgage obligations 4,600 1 (178 ) 4,423 Corporate debt securities, primarily financial institutions 1,999 3 (87 ) 1,915 Total securities available for sale $ 25,017 $ 10 $ (620 ) $ 24,407 Total equity securities $ 2,559 $ — $ (108 ) $ 2,451 Securities held to maturity: Municipal securities $ 36,436 $ 389 $ (111 ) $ 36,714 GSE – residential mortgage-backed securities 7,423 — (211 ) 7,212 U.S. Government collateralized residential mortgage obligations 1,769 — (57 ) 1,712 Corporate debt securities, primarily financial institutions 1,827 — (199 ) 1,628 Total securities held to maturity $ 47,455 $ 389 $ (578 ) $ 47,266 December 31, 2017 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value (In Thousands) Securities available for sale: U.S. Government agency securities $ 10,105 $ — $ (48 ) $ 10,057 Municipal securities 494 1 — 495 GSE – residential mortgage-backed securities 8,362 — (143 ) 8,219 U.S. Government collateralized residential mortgage obligations 7,672 1 (191 ) 7,482 Corporate debt securities, primarily financial institutions 2,494 9 (72 ) 2,431 Total securities available for sale $ 29,127 $ 11 $ (454 ) $ 28,684 Total equity securities $ 2,503 $ — $ (55 ) $ 2,448 Securities held to maturity: Municipal securities $ 46,614 $ 812 $ (20 ) $ 47,406 GSE – residential mortgage-backed securities 7,339 — (98 ) 7,241 U.S. Government collateralized residential mortgage obligations 2,224 — (46 ) 2,178 Corporate debt securities, primarily financial institutions 1,825 — (101 ) 1,724 Total securities held to maturity $ 58,002 $ 812 $ (265 ) $ 58,549 The amortized cost and fair value of the Company’s debt securities at December 31, 2018 , by contractual maturity, are shown below. 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. Available for Sale Held to Maturity Amortized Cost Fair Value Amortized Cost Fair Value (In Thousands) Due in one year or less $ 1,254 $ 1,245 $ 5,415 $ 5,423 Due in one year through five years 7,548 7,505 1,290 1,314 Due in five years through ten years 1,354 1,321 8,071 7,993 Due after ten years 4,130 3,966 23,487 23,612 Sub-total 14,286 14,037 38,263 38,342 GSE – residential mortgage-backed securities 6,131 5,947 7,423 7,212 U.S. Government collateralized residential mortgage obligations 4,600 4,423 1,769 1,712 Total $ 25,017 $ 24,407 $ 47,455 $ 47,266 The Company had no security sales in 2018 and 2017 and had one security sale in 2016 totaling $1.1 million and recorded gross realized gains of $72,000 . The sale in 2016 was a municipal bond, which was carried in our held to maturity portfolio. The Company sold this bond out of its held to maturity portfolio due to significant deterioration in the issuer’s creditworthiness. Investment securities with a carrying value of $24.7 million and $34.6 million at December 31, 2018 and 2017 , respectively, were pledged as collateral to secure securities sold under agreements to repurchase and public funds as required or permitted by law. The tables below indicate the length of time individual securities have been in a continuous unrealized loss position at December 31, 2018 and 2017 : Less than 12 Months 12 Months or More Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses December 31, 2018 (In Thousands) U.S. Government agency securities $ 4,842 $ (72 ) $ 5,470 $ (98 ) $ 10,312 $ (170 ) Municipal securities 5,227 (24 ) 8,378 (87 ) 13,605 (111 ) GSE – residential mortgage-backed securities 1,330 (10 ) 11,675 (386 ) 13,005 (396 ) U.S. Government collateralized residential mortgage obligations 146 — 5,938 (235 ) 6,084 (235 ) Corporate debt securities, primarily financial institutions 493 (8 ) 2,548 (278 ) 3,041 (286 ) Total temporarily impaired securities $ 12,038 $ (114 ) $ 34,009 $ (1,084 ) $ 46,047 $ (1,198 ) Less than 12 Months 12 Months or More Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses December 31, 2017 (In Thousands) U.S. Government agency securities $ 8,229 $ (46 ) $ 1,766 $ (2 ) $ 9,995 $ (48 ) Municipal securities 14,170 (20 ) — — 14,170 (20 ) GSE – residential mortgage-backed securities 6,302 (66 ) 9,123 (175 ) 15,425 (241 ) U.S. Government collateralized residential mortgage obligations 1,806 (20 ) 7,500 (217 ) 9,306 (237 ) Corporate debt securities, primarily financial institutions — — 2,648 (173 ) 2,648 (173 ) Equity securities — — 2,449 (55 ) 2,449 (55 ) Total temporarily impaired securities $ 30,507 $ (152 ) $ 23,486 $ (622 ) $ 53,993 $ (774 ) The Company had 71 securities in an unrealized loss position at December 31, 2018 . In management’s opinion, the unrealized losses in corporate debt, U.S. Government agencies, U.S. Government collateralized residential mortgage obligations, municipals, GSE residential mortgage-backed securities and the CRA mutual fund reflect changes in interest rates subsequent to the acquisition of specific securities. The unrealized loss for corporate debt securities also reflects a widening of spreads due to the liquidity and credit concerns in the financial markets. The Company may, if conditions warrant it, elect to sell debt securities at a loss and redeploy the proceeds into other investments in an effort to improve returns, risk profile and overall portfolio diversification. The Company will recognize any losses when the decision is made. At December 31, 2018 , the Company does not intend to sell these debt securities prior to recovery. Included in corporate debt securities are three individual trust preferred securities issued by large financial institutions with Moody’s ratings from Baa1to Baa2. As of December 31, 2018 , all of these securities are current with their scheduled interest payments. These single issue securities are from large money center banks. Management concluded that these securities were not other-than-temporarily impaired as of December 31, 2018 . These three securities have an amortized cost value of $2.3 million and a fair value of $2.1 million at December 31, 2018 . There were no other-than-temporary impairments recognized during 2018 and 2017 . Equity Securities at Fair Value Equity securities consist solely of the CRA Mutual Fund. As a result of the adoption of ASU 2016-01 in January 2018, the Company determined that the CRA Mutual Fund falls under the provisions of ASU 2016-01 and accordingly, this fund was transferred from available for sale and reclassified into equity securities on the balance sheet. These securities are measured at fair value with unrealized holding gains and losses reflected in net income. The market value of this investment was $2.5 million and $2.4 million as of December 31, 2018 and 2017, respectively. Effective January 1, 2018, the Company recorded a cumulative effect adjustment of $39,000 as a reclassification from accumulated other comprehensive loss to retained earnings. Additionally as noted above, all future unrealized gains and losses will be recognized in the Statements of Operations. As such, during the year ended December 31, 2018, an unrealized loss of $53,000 was recorded in Other Income. |
Loans Receivable and Allowance
Loans Receivable and Allowance for Loan Losses | 12 Months Ended |
Dec. 31, 2018 | |
Receivables [Abstract] | |
Loans Receivable and Allowance for Loan Losses | Loans Receivable and Allowance for Loan Losses The components of the loan portfolio at December 31, 2018 and 2017 are as follows: 2018 2017 (In Thousands) Commercial and industrial $ 109,362 $ 101,371 Real estate – construction 144,865 118,094 Real estate – commercial 552,549 537,733 Real estate – residential 84,123 64,238 Consumer 31,144 30,203 922,043 851,639 Allowance for loan losses (11,398 ) (10,668 ) Net unearned fees (742 ) (765 ) Net Loans $ 909,903 $ 840,206 The performance and credit quality of the loan portfolio is monitored by analyzing the age of the loans receivable as determined by the length of time a recorded payment is past due. The following table presents the classes of the loan portfolio summarized by the past due status as of December 31, 2018 and 2017 : December 31, 2018 (In Thousands) 30-59 Days Past Due 60-89 Days Past Due Greater than 90 Days Total Past Due Current Total Loans Receivable Loans Receivable>90 Days and Accruing Commercial and industrial $ 100 $ — $ 765 $ 865 $ 108,497 $ 109,362 $ — Real estate – construction 3,575 — 150 3,725 141,140 144,865 — Real estate – commercial 563 — 54 617 551,932 552,549 — Real estate – residential — 564 227 791 83,332 84,123 — Consumer — — 194 194 30,950 31,144 — Total $ 4,238 $ 564 $ 1,390 $ 6,192 $ 915,851 $ 922,043 $ — December 31, 2017 (In Thousands) 30-59 Days Past Due 60-89 Days Past Due Greater than 90 Days Total Past Due Current Total Loans Receivable Loans Receivable>90 Days and Accruing Commercial and industrial $ 224 $ — $ 790 $ 1,014 $ 100,357 $ 101,371 $ — Real estate – construction — — 150 150 117,944 118,094 — Real estate – commercial 146 150 219 515 537,218 537,733 — Real estate – residential 290 — 717 1,007 63,231 64,238 — Consumer 92 — 194 286 29,917 30,203 — Total $ 752 $ 150 $ 2,070 $ 2,972 $ 848,667 $ 851,639 $ — The following table presents non-accrual loans by classes of the loan portfolio at December 31, 2018 and 2017 : 2018 2017 (In Thousands) Commercial and industrial $ 765 $ 790 Real estate – construction 150 150 Real estate – commercial 54 219 Real estate – residential 227 717 Consumer 194 194 Total $ 1,390 $ 2,070 The following table summarizes information in regards to impaired loans by loan portfolio class as of and for the years ended December 31, 2018 , 2017 and 2016 : December 31, 2018 Recorded Investment, Net of Charge-offs Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized (In Thousands) With no related allowance recorded: Commercial and industrial $ 4,200 $ 4,200 $ — $ 3,201 $ 131 Real estate – construction 3,082 3,082 — 3,116 134 Real estate – commercial 168 168 — 174 6 Real estate – residential 589 589 — 593 18 Consumer 194 194 — 194 — With an allowance recorded: Commercial and industrial $ — $ — $ — $ — $ — Real estate – construction — — — — — Real estate – commercial — — — — — Real estate – residential — — — — — Consumer — — — — — Total: Commercial and industrial $ 4,200 $ 4,200 $ — $ 3,201 $ 131 Real estate – construction 3,082 3,082 — 3,116 134 Real estate – commercial 168 168 — 174 6 Real estate – residential 589 589 — 593 18 Consumer 194 194 — 194 — Total $ 8,233 $ 8,233 $ — $ 7,278 $ 289 December 31, 2017 Recorded Investment, Net of Charge-offs Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized (In Thousands) With no related allowance recorded: Commercial and industrial $ 3,350 $ 3,697 $ — $ 3,758 $ 152 Real estate – construction 3,148 3,148 — 3,163 133 Real estate – commercial 344 344 — 411 6 Real estate – residential 1,086 1,086 — 1,105 18 Consumer 194 194 — 194 1 With an allowance recorded: Commercial and industrial $ — $ — $ — $ — $ — Real estate – construction — — — — — Real estate – commercial — — — — — Real estate – residential — — — — — Consumer — — — — — Total: Commercial and industrial $ 3,350 $ 3,697 $ — $ 3,758 $ 152 Real estate – construction 3,148 3,148 — 3,163 133 Real estate – commercial 344 344 — 411 6 Real estate – residential 1,086 1,086 — 1,105 18 Consumer 194 194 — 194 1 Total $ 8,122 $ 8,469 $ — $ 8,631 $ 310 December 31, 2016 Recorded Unpaid Related Average Interest (In Thousands) With no related allowance recorded: Commercial and industrial $ 3,402 $ 3,415 $ — $ 3,575 $ 174 Real estate – construction 3,036 3,036 — 3,073 129 Real estate – commercial 1,548 1,577 — 1,618 47 Real estate – residential 1,139 1,189 — 1,164 18 Consumer — — — — — With an allowance recorded: Commercial and industrial $ 498 $ 498 $ 2 $ 507 $ 15 Real estate – construction — — — — — Real estate – commercial — — — — — Real estate – residential — — — — — Consumer — — — — — Total: Commercial and industrial $ 3,900 $ 3,913 $ 2 $ 4,082 $ 189 Real estate – construction 3,036 3,036 3,073 129 Real estate – commercial 1,548 1,577 1,618 47 Real estate – residential 1,139 1,189 1,164 18 Consumer — — — — Total $ 9,623 $ 9,715 $ 2 $ 9,937 $ 383 The following table presents the classes of the loan portfolio summarized by the aggregate pass rating and the classified ratings of special mention, substandard and doubtful within the Company’s internal risk rating system as of December 31, 2018 and 2017 : Pass Special Mention Substandard Doubtful Total (In Thousands) December 31, 2018 Commercial and industrial $ 104,557 $ 126 $ 4,679 $ — $ 109,362 Real estate – construction 138,858 1,577 4,430 — 144,865 Real estate – commercial 549,083 2,722 744 — 552,549 Real estate – residential 83,896 — 227 — 84,123 Consumer 30,782 — 362 — 31,144 Total $ 907,176 $ 4,425 $ 10,442 $ — $ 922,043 Pass Special Mention Substandard Doubtful Total (In Thousands) December 31, 2017 Commercial and industrial $ 97,160 $ 796 $ 3,299 $ 116 $ 101,371 Real estate – construction 112,353 4,252 1,489 — 118,094 Real estate – commercial 525,951 5,681 6,101 — 537,733 Real estate – residential 63,521 — 717 — 64,238 Consumer 29,795 34 374 — 30,203 Total $ 828,780 $ 10,763 $ 11,980 $ 116 $ 851,639 During the fourth quarter of 2018, Management employed a more refined estimation in determining the risk levels assigned to each of its qualitative factors in the allowance for loan losses. While this did not result in a significant change to the allowance for loans losses as a whole, it did result increasing or decreasing the provision for certain loan categories that the Company either had experienced more or less historical net charge-offs. The following table presents the change in the allowance for loan losses by classes of loans as of December 31, 2018 , 2017 and 2016 : Allowance for Loan Losses Commercial and Industrial Real Estate - Construction Real Estate - Commercial Real Estate – Residential Consumer Unallocated Total (In Thousands) Beginning balance, January 1, 2018 $ 930 $ 1,389 $ 7,325 $ 502 $ 174 $ 348 $ 10,668 Charge-offs (116 ) — (12 ) — — — (128 ) Recoveries 33 3 26 — 21 — 83 Provision (102 ) 657 (56 ) 166 (48 ) 158 775 Ending balance, December 31, 2018 $ 745 $ 2,049 $ 7,283 $ 668 $ 147 $ 506 $ 11,398 Allowance for Loan Losses Commercial and Industrial Real Estate - Construction Real Estate - Commercial Real Estate - Residential Consumer Unallocated Total (In Thousands) Beginning balance, January 1, 2017 $ 844 $ 1,276 $ 6,315 $ 463 $ 244 $ 423 $ 9,565 Charge-offs (381 ) — — — (106 ) — (487 ) Recoveries 18 12 24 — 6 — 60 Provision 449 101 986 39 30 (75 ) 1,530 Ending balance, December 31, 2017 $ 930 $ 1,389 $ 7,325 $ 502 $ 174 $ 348 $ 10,668 Allowance for Loan Losses Commercial Real Estate - Real Estate - Real Estate - Consumer Unallocated Total (In Thousands) Beginning balance, January 1, 2016 $ 990 $ 1,283 $ 5,599 $ 304 $ 242 $ 295 $ 8,713 Charge-offs — — (444 ) — (5 ) — (449 ) Recoveries 12 12 696 — 66 — 786 Provision (158 ) (19 ) 464 159 (59 ) 128 515 Ending balance, December 31, 2016 $ 844 $ 1,276 $ 6,315 $ 463 $ 244 $ 423 $ 9,565 The following table presents the balance in the allowance for loan losses at December 31, 2018 and 2017 disaggregated on the basis of the Company’s impairment method by class of loans receivable along with the balance of loans receivable by class disaggregated on the basis of the Company’s impairment methodology: Allowance for Loan Losses Loans Receivable December 31, 2018 Balance Balance Related to Loans Individually Evaluated for Impairment Balance Related to Loans Collectively Evaluated for Impairment Balance Balance Individually Evaluated for Impairment Balance Collectively Evaluated for Impairment (In Thousands) Commercial and industrial $ 745 $ — $ 745 $ 109,362 $ 4,200 $ 105,162 Real estate – construction 2,049 — 2,049 144,865 3,082 141,783 Real estate – commercial 7,283 — 7,283 552,549 168 552,381 Real estate – residential 668 — 668 84,123 589 83,534 Consumer 147 — 147 31,144 194 30,950 Unallocated 506 — 506 — — — Total $ 11,398 $ — $ 11,398 $ 922,043 $ 8,233 $ 913,810 Allowance for Loan Losses Loans Receivable December 31, 2017 Balance Balance Related to Loans Individually Evaluated for Impairment Balance Related to Loans Collectively Evaluated for Impairment Balance Balance Individually Evaluated for Impairment Balance Collectively Evaluated for Impairment (In Thousands) Commercial and industrial $ 930 $ — $ 930 $ 101,371 $ 3,350 $ 98,021 Real estate – construction 1,389 — 1,389 118,094 3,148 114,946 Real estate – commercial 7,325 — 7,325 537,733 344 537,389 Real estate – residential 502 — 502 64,238 1,086 63,152 Consumer 174 — 174 30,203 194 30,009 Unallocated 348 — 348 — — — Total $ 10,668 $ — $ 10,668 $ 851,639 $ 8,122 $ 843,517 The following tables present newly troubled debt restructured loans that occurred during the years ended December 31, 2018 and 2017: Year Ended December 31, 2018 Number of Contracts Pre-Modification Outstanding Recorded Investment Post-Modification Outstanding Recorded Investment (Dollars in Thousands) Troubled Debt Restructuring: Commercial and industrial 2 $ 2,738 $ 2,738 Year Ended December 31, 2017 Number of Pre-Modification Post-Modification (Dollars in Thousands) Troubled Debt Restructuring: Commercial and Industrial 3 $ 320 $ 320 Real Estate - Construction 1 150 150 4 $ 470 $ 470 As of December 31, 2018 , TDRs totaled $7.7 million , including $6.8 million that were current and six non-accrual loans totaling $877,000 . As of December 31, 2017 , TDRs totaled $7.0 million , including $6.0 million that were current and seven non-accrual TDRs totaling $1.0 million . During the twelve months ended December 31, 2018 , no TDRs were paid in full compared to the twelve months ended December 31, 2017 during which two TDRs totaling $726,000 were paid in full. At December 31, 2018 and 2017 , there were no loans with a specific reserve. Our troubled debt restructured loans are generally structured with short-term payment plans. The extent of these plans is generally made on terms up to twelve-month payments and all the loans identified as troubled debt restructured as of December 31, 2018 , generally involve a temporary reduction in interest rate or a modification of a loan’s amortization schedule. There were no loans receivable modified as TDRs and with a payment default occurring within 12 months of the restructure date, and the payment default occurring during the three years ended December 31, 2018 . It is the Company’s policy to classify a TDR that is either 90 days or greater delinquent or that has been placed in a non-accrual status as a subsequently defaulted TDR. |
Premises and Equipment
Premises and Equipment | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Premises and Equipment | Premises and Equipment Premises and equipment at December 31, 2018 and 2017 are as follows: Estimated Useful Lives (years) 2018 2017 (In Thousands) Land Indefinite $ 1,487 $ 1,487 Buildings 30 2,114 2,120 Leasehold improvements 5 — 15 3,342 3,432 Furniture and equipment 2 — 7 9,033 8,915 Construction in progress 1,267 1,136 Total premises and equipment 17,243 17,090 Less accumulated depreciation and amortization (11,326 ) (10,851 ) Total premises and equipment, net $ 5,917 $ 6,239 During the fourth quarter of 2017, the Company acquired a former bank building in Middletown, NJ., and is in the process of constructing a new branch. This branch is expected to open in 2019. As of December 31, 2018 and 2017, construction in progress represents expenditures the Company has incurred related to the new Middletown Branch. The majority of these expenditures relate to the acquisition of the location. The Company anticipates additional costs of approximately $250,000 to complete the branch. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets The Company’s goodwill was recognized in connection with the acquisition of The Town Bank (“Town Bank”) in April 2006. GAAP requires that goodwill be tested for impairment annually or more frequently if impairment indicators arise utilizing a two-step methodology. However, a qualitative factor test can be performed to determine whether it is necessary to perform the two-step quantitative impairment test. If this qualitative test determines it is not likely (less than 50% probability) the fair value of the reporting unit is less than book value, then the Company does not have to perform a step one quantitative test and goodwill can be considered not impaired. The Company reviewed the requirements of ASU 350-20 and examples of qualitative assessments to determine whether the weight of evidence indicates greater than 50% likelihood exists that the carrying value of the reporting unit exceeds its fair value. The nine qualitative assessments used are macroeconomic factors, banking industry conditions, banking industry merger and acquisition trends, bank historical performance, parent stock price, expected bank performance, change of control premium (parent), change of control premium (peer), and other factors. The Company performed its annual qualitative factor goodwill impairment test as of August 31, 2018 and 2017 . Based on the results of this analysis, the Company determined that there was no impairment on the current goodwill balance of $18,109,000 for the years ended December 31, 2018 and 2017 . |
Deposits
Deposits | 12 Months Ended |
Dec. 31, 2018 | |
Deposits [Abstract] | |
Deposits | Deposits The components of deposits at December 31, 2018 and 2017 are as follows: 2018 2017 (In Thousands) Demand, non-interest bearing $ 176,655 $ 167,297 Demand, interest-bearing, money market and savings 495,949 534,939 Time, $250,000 and over 38,512 14,853 Time, other 206,238 144,468 Total deposits $ 917,354 $ 861,557 At December 31, 2018 , the scheduled maturities of time deposits are as follows (in thousands): 2019 $ 107,854 2020 76,664 2021 21,678 2022 23,453 2023 15,101 Total time deposits $ 244,750 Brokered CDs as of December 31, 2018 and 2017 were $74,080,000 and $40,702,000 , respectively. Deposits obtained through the use of deposit listing services that are not brokered deposits as of December 31, 2018 and 2017 were $39,807,000 and $44,436,000 , respectively. The aggregate amounts of demand deposit overdrafts that have been reclassified as loan balances are $183,000 and $944,000 as of December 31, 2018 and 2017 , respectively. |
Securities Sold Under Agreement
Securities Sold Under Agreements to Repurchase | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Repurchase Agreements [Abstract] | |
Securities Sold Under Agreements to Repurchase | Securities Sold Under Agreements to Repurchase Securities sold under agreements to repurchase, which are classified as secured borrowings, generally mature within one to four days from the transaction date. Securities sold under agreements to repurchase are reflected as the amount of cash received in connection with the transaction. Securities sold under these agreements are retained under the Company’s control at its safekeeping agent. The Company may be required to provide additional collateral based on the fair value of the underlying securities. Information concerning repurchase agreements for the three years ended December 31, 2018 is as follows: 2018 2017 2016 (Dollars In Thousands) Repurchase agreements: Balance at year-end $ 19,402 $ 27,120 $ 19,915 Average during the year $ 19,738 $ 22,066 $ 19,309 Maximum month-end balance $ 23,884 $ 27,120 $ 22,105 Weighted average rate during the year 0.29 % 0.30 % 0.32 % Weighted average rate at December 31 0.24 % 0.25 % 0.24 % The Bank enters into Sweep Account Agreements with certain of its deposit account holders for repo sweep arrangements under which funds in excess of a predetermined amount are removed from each such depositor’s account at the end of each banking day, and the Bank’s obligation to restore those funds to the account at the beginning of the following banking day is evidenced by an integrated retail repurchase agreement (a “Repurchase Agreement”) secured by a collateral interest in favor of the depositor in certain government securities held by a third party custodian. The Bank’s obligation to restore the funds under the Repurchase Agreements is accounted for as a collateralized financing arrangement (i.e., secured borrowings), and not as a sale and subsequent repurchase of securities. The obligation to restore the funds to each account is reflected as a liability in the Company's consolidated balance sheets, while the securities underlying the repurchase agreements remain in the respective securities accounts. There is no offsetting or netting of the securities against the Repurchase Agreement obligation. The following table presents the contractual maturities of the Repurchase Agreements as of December 31, 2018 and 2017 , disaggregated by the class of collateral pledged: Maturity of Repurchase Agreements (dollars in thousands) Overnight and Continuous Up to 30 days 30 to 90 days Over 90 days Total December 31, 2018 Class of Collateral Pledged: U.S. Government agency securities $ 11,566 $ — $ — $ — $ 11,566 GSE – Residential mortgage-backed securities 4,289 — — — 4,289 U.S. Government collateralized residential mortgage obligations 10,334 — — — 10,334 Total $ 26,189 $ — $ — $ — $ 26,189 Gross amount of recognized liabilities for repurchase agreements and securities lending $ 19,402 Excess of collateral pledged over recognized liability $ 6,787 Maturity of Repurchase Agreements (dollars in thousands) Overnight Up to 30 to 90 Over 90 Total December 31, 2017 Class of Collateral Pledged: U.S. Government agency securities $ 9,995 $ — $ — $ — $ 9,995 GSE – Residential mortgage-backed securities 5,558 — — — 5,558 U.S. Government collateralized residential mortgage obligations 13,440 — — — 13,440 Total $ 28,993 $ — $ — $ — $ 28,993 Gross amount of recognized liabilities for repurchase agreements and securities lending $ 27,120 Excess of collateral pledged over recognized liability $ 1,873 The potential risks associated with the Repurchase Agreements and related pledged collateral, including obligations arising from a decline in the fair value of the pledged collateral, are minimal due to the fact that the Repurchase Agreements pertain to overnight borrowings and therefore, are not subject to fluctuations in fair market value. |
FHLB and Other Borrowings
FHLB and Other Borrowings | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
FHLB and Other Borrowings | FHLB and Other Borrowings The Bank utilizes an account relationship with Atlantic Community Bankers Bank to borrow funds through its Federal funds borrowing line in an aggregate amount up to $10.0 million . The Bank also has $36.0 million in unsecured credit facilities with three correspondent banks. These borrowings are priced on a daily basis. The Bank had no borrowings outstanding on these lines at December 31, 2018 or 2017 . The Bank also has a remaining borrowing capacity with the FHLB of approximately $47.6 million based on the current loan collateral pledged of $147.6 million at December 31, 2018 . At December 31, 2018 and 2017 , FHLB and other borrowings consisted of advances from the FHLB, which amounted to $22.5 million and $25.8 million , respectively. These advances had a weighted average interest rate of 1.93% and 1.87% at December 31, 2018 and 2017 , respectively. These advances are contractually scheduled for repayment as follows (dollars in thousands): 2018 2017 Rate Original Term (years) Maturity Fixed Rate Note — 2,000 1.65 % 5 October 2018 Fixed Rate Note — 1,300 1.31 % 3 January 2018 Fixed Rate Note 1,800 1,800 1.59 % 4 January 2019 Fixed Rate Note 2,700 2,700 1.81 % 5 January 2020 Fixed Rate Note 2,500 2,500 2.03 % 6 January 2021 Fixed Rate Note 1,000 1,000 1.09 % 3 July 2019 Fixed Rate Note 1,000 1,000 1.42 % 5 July 2021 Fixed Rate Note 1,000 1,000 1.70 % 7 July 2023 Fixed Rate Note 7,500 7,500 2.07 % 5 August 2022 Fixed Rate Note 5,000 5,000 2.16 % 4 October 2021 Total FHLB borrowings $ 22,500 $ 25,800 As of December 31, 2018 , the FHLB has issued $75.1 million in municipal deposit letters of credit in the name of the Bank naming the NJ Department of Banking and Insurance as beneficiary. This letter of credit will take the place of securities previously pledged to the State of New Jersey for the Bank’s various municipal deposits. |
Subordinated Debentures
Subordinated Debentures | 12 Months Ended |
Dec. 31, 2018 | |
Subordinated Debt [Abstract] | |
Subordinated Debentures | Subordinated Debentures In December 2015, the Company completed a private placement of $10 million in aggregate principal amount of fixed to floating rate subordinated debentures to certain institutional accredited investors. The subordinated debentures have a maturity date of December 31, 2025 and bear interest, payable quarterly, at the rate of 6.25% per annum until January 1, 2021. On that date, the interest rate will be adjusted to float at an annual rate equal to the three-month LIBOR rate plus 464 basis points ( 4.64% ) until maturity. The debentures include a right of prepayment, without penalty, on or after December 14, 2020 and, in certain limited circumstances, before that date. The indebtedness evidenced by the subordinated debentures, including principal and interest, is unsecured and subordinate and junior in right to payment to general and secured creditors of the Company and depositors and all other creditors of the Bank. The subordinated debentures have been structured to qualify as Tier 2 capital for regulatory purposes. Subordinated debentures totaled $9.9 million at December 31, 2018 , 2017 and 2016 , respectively, which includes $77,000 , $112,000 and $145,000 of remaining unamortized debt issuance costs at December 31, 2018 , 2017 , and 2016 , respectively. The debt issuance costs are being amortized over the expected life of the issue. The effective interest rate of the subordinated debentures is 6.67% . |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2018 | |
Compensation Related Costs [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans Under the 401(k) plan, all employees are eligible to contribute up to 100% of their pay and bonus up to the IRS yearly limit. Annually, the Company matches a percentage of employee contributions. The Company contributed $335,000 , $304,000 , and $288,000 for the years ended December 31, 2018 , 2017 and 2016, respectively. Each year, the Company may, at its discretion, elect to contribute profit sharing amounts into the 401(k) plan. For the three years ended December 31, 2018 , the Company has not contributed any profit sharing amounts. The Company has a non-qualified Supplemental Executive Retirement Plan for certain executive officers that provides for payments upon retirement, death or disability. At December 31, 2018 and 2017 , other liabilities included approximately $2.1 million and $1.9 million respectively, accrued under this plan. Expenses related to this plan, which are included in the consolidated statements of operations and are recorded in salaries and employee benefits, amounted to $319,000 , $309,000 and $204,000 for the years ended December 31, 2018, 2017 and 2016, respectively. On September 7, 2016, the Bank entered into a deferred compensation agreement with the President and CEO, effective September 1, 2016, to provide nonqualified pension benefits. Under the deferred compensation agreement, the President and CEO may elect to defer receipt of up to $100,000 of his base salary to be credited to the deferral account under the agreement. In addition, the Bank may make elective contributions to the deferral account. The Bank made elective contributions to the deferred account in the amount of $70,000 for the years ended December 31, 2018 and 2017 , respectively. The Bank may, at any time, make additional employer contributions to the deferral account. Amounts credited to the President and CEO’s deferral account are adjusted monthly for interest, as described in the agreement. The unfunded liability related to the deferred compensation agreement was $329,000 and $183,000 as of December 31, 2018 and 2017 , respectively, and is recorded in other liabilities in the consolidated balance sheets. For the years ended December 31, 2018 and 2017 , expenses related to this plan, which are included in the consolidated statements of operations and are recorded in salaries and employee benefits, amounted to $147,000 and $100,000 , respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company follows FASB ASC Topic 740, "Income Taxes," which prescribes a threshold for the financial statement recognition of income taxes and provides criteria for the measurement of tax positions taken or expected to be taken in a tax return. ASC 740 also includes guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition of income taxes. As a result of the enactment of the Tax Act on December 22, 2017, which reduced the Federal corporate income tax rate from 34% to 21% beginning in 2018, the Company revalued its net deferred tax asset at December 31, 2017 to reflect the lower corporate income tax rate that would be in effect in future years. As such, the Company reduced its net deferred tax asset by $1.8 million , which was recorded as a non-cash charge to income tax expense in the fourth quarter of 2017. The reduction in the corporate tax rate provided significant tax benefits in 2018 by lowering the effective tax rate. On July 1, 2018, New Jersey's Assembly Bill 4202 was signed into law. The new Bill, effective January 1, 2018, imposed a temporary surtax on corporations earning New Jersey allocated income in excess of $1 million at a rate of 2.5% for tax years beginning on or after January 1, 2018, through December 31, 2019, and at 1.5% for tax years beginning on or after January 1, 2020, through December 31, 2021. In addition, effective for periods on or after January 1, 2019, New Jersey is adopting mandatory unitary combined reporting for its Corporation Business Tax. The Company did not recognize or accrue any interest or penalties related to income taxes for the years ended December 31, 2018 or 2017. The Company did not have an accrual for uncertain tax positions as of December 31, 2018 or 2017, as deductions taken and benefits accrued are based on widely understood administrative practices and procedures and are based on clear and unambiguous tax law. The components of income tax expense for the years ended December 31, 2018 , 2017 and 2016 are as follows: 2018 2017 2016 (In Thousands) Current $ 4,419 $ 4,957 $ 4,791 Deferred (429 ) 1,061 (463 ) Income tax expense $ 3,990 $ 6,018 $ 4,328 A reconciliation of the statutory Federal income tax at a rate of 21% for 2018 and 34% for 2017 and 2016 to the income tax expense included in the statements of operations is as follows: 2018 2017 2016 Amount % Amount % Amount % (Dollars In Thousands) Federal income tax expense at statutory rate $ 3,191 21.0 % $ 4,257 34.0 % $ 4,406 34.0 % Increases (decreases) resulting from: Tax exempt interest (233 ) (1.5 ) (358 ) (2.9 ) (334 ) (2.6 ) Bank owned life insurance income (110 ) (0.7 ) (185 ) (1.5 ) (455 ) (3.5 ) State income taxes, net of federal income tax benefit 1,366 9.0 734 5.9 712 5.5 Reduction in Federal tax rate — — 1,778 14.3 — — Stock-based compensation (216 ) (1.4 ) (191 ) (1.5 ) — — Other, net (8 ) (0.1 ) (17 ) (0.2 ) (1 ) — Income tax expense $ 3,990 26.3 % $ 6,018 48.1 % $ 4,328 33.4 % The components of the net deferred tax asset, included in other assets on the Consolidated Balance Sheets, as of December 31, 2018 and 2017 , were as follows: 2018 2017 (In Thousands) Deferred tax assets: Allowance for loan losses $ 3,219 $ 3,012 Depreciation and amortization 288 415 Deferred compensation 1,299 1,063 Unrealized loss on securities available for sale 165 194 Other 2 35 Total deferred tax assets 4,973 4,719 Deferred tax liabilities: Deferred loan origination costs (384 ) (366 ) Total deferred tax liabilities (384 ) (366 ) Net Deferred Tax Asset $ 4,589 $ 4,353 Based upon taxes paid and projected future taxable income, Management believes that it is more likely than not that the gross deferred tax asset will be realized. During 2018 and 2017, the Company realized $216,000 and $191,000 , respectively, of tax benefits relating to the accounting treatment of equity based compensation relating to the adoption of ASU 2016-09. These benefits were recorded as a reduction to our income tax expense. The Company is subject to U.S. Federal income tax as well as income tax in various state jurisdictions. The Company is no longer subject to Federal examination for years prior to 2015 and state examination for tax years prior to 2014. . |
Earnings Per Common Share
Earnings Per Common Share | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Common Share | Earnings Per Common Share The following sets forth the computation of basic and diluted earnings per common share for the three years ended December 31, 2018 : Years Ended December 31, 2018 2017 2016 (In Thousands, Except Per Share Data) Net income $ 11,206 $ 6,502 $ 8,631 Preferred stock dividend — — — Income applicable to common shareholders $ 11,206 $ 6,502 $ 8,631 Weighted average common shares outstanding 8,508 8,388 8,321 Effect of dilutive securities, stock options and restricted stock 194 270 209 Weighted average common shares outstanding used to calculate diluted earnings per share 8,702 8,658 8,530 Basic earnings per common share $ 1.32 $ 0.78 $ 1.04 Diluted earnings per common share $ 1.29 $ 0.75 $ 1.01 Dilutive securities in the table above exclude common stock options with exercise prices that exceed the average market price of the Company’s common stock during the periods presented. Inclusion of these common stock options would be anti-dilutive to the diluted earnings per common share calculation. For 2018 , 2017 and 2016 , there were no stock options that were anti-dilutive. |
Lease Commitments and Total Ren
Lease Commitments and Total Rental Expense | 12 Months Ended |
Dec. 31, 2018 | |
Leases, Operating [Abstract] | |
Lease Commitments and Total Rental Expense | Lease Commitments and Total Rental Expense The Company leases banking facilities under non-cancelable operating lease agreements expiring through 2032. These leases include renewal options and escalation clauses. Aggregate rent expense was $2.0 million , $2.1 million , and $2.0 million , for the years ended December 31, 2018 , 2017 and 2016, respectively. The approximate future minimum rental commitments under operating leases at December 31, 2018 are as follows (in thousands): 2019 $ 1,481 2020 1,384 2021 1,420 2022 1,465 2023 1,490 Thereafter 8,508 Total $ 15,748 |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation General The Two River Bancorp 2007 Equity Incentive Plan (the “Plan”) provides that the Compensation Committee of the Board of Directors (the “Committee”) may grant to those individuals who are eligible under the terms of the Plan stock options, shares of restricted stock, or such other equity incentive awards as the Committee may determine. As of December 31, 2018 , the number of shares of Company common stock remaining and available for future issuance under the Plan is 111,419 . Shares reserved under the Plan will be issued out of authorized and unissued shares, or treasury shares, or partly out of each, as determined by the Board. All share and per share data have been retroactively adjusted to reflect the 5% stock dividend paid on February 28, 2017 to shareholders of record as of February 9, 2017. From the adoption of the Plan until March 20, 2017, options awarded under the Plan were permitted to be either options that qualify as incentive stock options (“ISOs”) under Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”), or options that do not, or cease to, qualify as incentive stock options under the Code (“nonqualified stock options” or “NQSOs”). However after March 20, 2017, only NQSO's may be awarded under the Plan. Awards may be granted under the Plan to directors and employees of the Company, and to consultants and other persons who provide substantial services to the Company. The exercise price per share purchasable under either an ISO or a NQSO may not be less than the fair market value of a share of stock on the date of grant of the option. The Committee will determine the vesting period and term of each option, provided that no ISO or NQSO may have a term in excess of ten years after the date of grant. Restricted stock is stock which is subject to certain transfer restrictions and to a risk of forfeiture. The Committee will determine the period over which any restricted stock which is issued under the Plan will vest, and will impose such restrictions on transferability, risk of forfeiture and other restrictions as the Committee may in its discretion determine. Unless restricted by the Committee, a participant granted restricted stock will have all of the rights of a shareholder (except for the aforesaid transfer restrictions and risk of forfeitures), including the right to vote the restricted stock and the right to receive dividends with respect to that stock. Unless otherwise provided by the Committee in the award document or subject to other applicable restrictions, in the event of a Change in Control (as defined in the Plan) all non-forfeited options and awards carrying a right to exercise that was not previously exercisable and vested will become fully exercisable and vested as of the time of the Change in Control, and all restricted stock and awards subject to risk of forfeiture will become fully vested. Stock Options For the twelve months ended December 31, 2018 , there were no options granted. Stock-based compensation expense related to the stock option grants was approximately $58,000 , $80,000 , and $113,000 for the three years ended December 31, 2018 , 2017 and 2016, respectively, and is included in salaries and employee benefits on the statement of operations. Total unrecognized compensation cost related to non-vested options under the Plan was $54,000 as of December 31, 2018 and will be recognized over the subsequent weighted average life of 1.8 years . The following table presents information regarding the Company’s outstanding options: Number of Shares Weighted Average Price Weighted Average Remaining Contractual Life (years) Aggregate Intrinsic Value Options outstanding, December 31, 2017 361,507 $ 5.20 Options exercised (115,824 ) 3.65 Options forfeited (3,150 ) 8.83 Options outstanding, December 31, 2018 242,533 $ 5.89 3.74 $ 2,269,959 Options exercisable, December 31, 2018 221,231 $ 5.59 3.45 $ 2,138,979 Options price range at December 31, 2018 $ 2.87 to $ 11.21 The total intrinsic value of stock options exercised was $1,573,800 , $911,700 , and $190,800 during the three years ended December 31, 2018 , 2017 and 2016, respectively. Cash received from such exercises was $423,000 , $275,900 , and $104,100 , during the three years ended December 31, 2018, 2017 and 2016, respectively. An income tax benefit of $210,000 and $152,000 was recognized during the years ended December 31, 2018 and 2017 , respectively, relating to the adoption of ASU 2016-09, Compensation - Stock Compensation, Improvements to Employee Share-Based Payment Accounting, attributable to stock options. There was a $25,000 tax benefit recognized during the year ended December 31, 2016. The following summarizes information about stock options outstanding at December 31, 2018 : Options Outstanding Range of Exercise Prices Number Outstanding at Weighted-Average Remaining Contractual Life (years) Weighted- Average Exercise Price $ 2.87 — $ 3.65 51,862 0.6 $ 3.10 $ 4.94 — $ 5.23 94,320 3.27 5.03 $ 7.06 — $ 8.00 62,625 5.39 7.53 $ 8.59 — $ 11.21 33,726 7.25 9.51 Total options outstanding 242,533 The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model. The following assumptions were used to estimate the fair value of the stock options granted on October 11, 2016: Dividend yield 1.33 % Expected volatility 27.67 % Risk-free interest rate 1.54 % Expected life (in years) 7.5 Weighted average fair value of options granted $ 3.05 The dividend yield assumption is based on the Company’s history and expectations of cash dividends. The expected volatility is based on historical volatility. The risk-free interest rate is based on the U.S. Treasury yield curve for the expected life of the grants which is based on historical exercise experience. Restricted Stock Restricted stock is valued at the market value on the date of grant and expense is evenly attributed to the period in which the restrictions lapse. On January 30, 2018, the Company awarded an aggregate 8,400 shares of the Company’s common stock that vest 50% on January 30, 2021, with the remaining 50% vesting in equal increments over the two year period beginning January 30, 2022. On June 7, 2018, the Company awarded an aggregate 11,000 shares of the Company’s common stock that vest ratably in annual one-third increments per year over three years beginning June 7, 2019. On December 4, 2018, the Company awarded an aggregate 14,250 shares of the Company’s common stock that vest 50% on December 4, 2021, with the remaining 50% vesting in equal increments over the two year period beginning December 4, 2022. Compensation expense related to the restricted stock was $259,000 , $199,000 , and $118,000 for the years ended December 31, 2018 , 2017 and 2016, respectively, and is included in salaries and employee benefits on the statement of operations. There were income tax benefits of $6,000 and $39,000 for the years ended December 31, 2018 and 2017 related to the adoption of ASU 2016-09 attributable to the restricted stock awards. There was no tax benefit recognized during year ended December 31, 2016. Total unrecognized compensation cost related to restricted stock under the Plan was $872,000 as of December 31, 2018 and will be recognized over the subsequent weighted average life of 3.5 years . The following table summarizes information about restricted stock for the year ended December 31, 2018 : Number of Shares Weighted Average Price Unvested at December 31, 2017 49,021 $ 14.01 Restricted stock earned (14,931 ) 12.93 Granted 34,450 16.78 Forfeited (500 ) 18.32 Unvested at December 31, 2018 68,040 $ 15.61 Other Awards During the years ended December 31, 2018 , 2017 , and 2015, the Company granted 800 , 1,100 , and 1,050 shares of stock, respectively, to certain other persons who will provide substantial services to the Company. The Company placed no restrictions on these shares. These shares were valued at the market value on the date of grant at $13,300 $19,950 , and $10,390 and were expensed during the years ended December 31, 2018 , 2017 , and 2016 respectively. |
Transactions with Executive Off
Transactions with Executive Officers, Directors and Principal Shareholders | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Transactions with Executive Officers, Directors, and Principal Shareholders | Transactions with Executive Officers, Directors and Principal Shareholders Certain directors and executive officers of Two River Bancorp and its affiliates, including their immediate families and companies in which they are principal owners (more than 10% ), are indebted to the Bank. Two River Bancorp relies on such directors and executive officers for the identification of their associates. These loans at December 31, 2018 were current as to principal and interest payments, and did not involve more than normal risk of collectability. Total extensions of credit to related parties at December 31, 2018 and 2017 were $12.4 million and $13.0 million , respectively. Of these amounts, loans outstanding to related parties at December 31, 2018 and 2017 were $8.9 million and $7.7 million , respectively, with the balance representing unused extensions of credit. During 2018 , new loans and advances to such related parties totaled $6.3 million and repayments and other reductions aggregated $5.1 million . Deposits from certain directors, executive officers and their affiliates at December 31, 2018 and 2017 totaled $24.6 million and $12.9 million , respectively, plus an additional $39,000 and $6.1 million , respectively, in securities sold under agreements to repurchase. With the exception of William D. Moss as outlined below, in 2018 and 2017 , the Company did not pay any amounts to any director or his or her affiliates for products or services, except for compensation for board or board committee services. William D. Moss, the Company's Chairman, President and Chief Executive Officer, is a member of the Board of Directors of Atlantic Community Bankers Bank ("ACBB"). The Bank utilizes ACBB as a correspondent bank and for certain compliance reviews, and utilizes ACBB BITS, a subsidiary of ACBB, for various internet and telephone services. During 2018 and 2017, the Company paid ACBB and related companies $428,000 and $439,000 , respectively, for services. |
Financial Instruments with Off-
Financial Instruments with Off-balance Sheet Risk | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Financial Instruments with Off-Balance Sheet Risk | Financial Instruments with Off-Balance Sheet Risk The Company is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and letters of credit. Those instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the financial statements. The Company’s exposure to credit loss in the event of non-performance by the other party to the financial instrument for commitments to extend credit and letters of credit is represented by the contractual amount of those instruments. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments. Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. The Company evaluates each customer's credit worthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Company upon extension of credit, is based on management's credit evaluation. Collateral held varies but may include personal or commercial real estate, accounts receivable, inventory and equipment. The Company had commitments to extend credit, including unused lines of credit, of approximately $264.1 million and $245.8 million at December 31, 2018 and 2017 , respectively. Standby letters of credit are conditional commitments issued by the Company to guarantee the financial performance of a customer to a third party. Those guarantees are primarily issued to support contracts entered into by customers. Most guarantees extend for one year. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. The Company defines the fair value of these letters of credit as the fees paid by the customer or similar fees collected on similar instruments. The Company amortizes the fees collected over the life of the instrument. The Company generally obtains collateral, such as real estate or liens on customer assets for these types of commitments. The Company’s potential liability would be reduced by any proceeds obtained in liquidation of the collateral held. The Company had commercial and similar letters of credit for customers aggregating $4.2 million and $5.2 million at December 31, 2018 and 2017 , respectively. The current amounts of the liability related to guarantees under standby letters of credit issued are not material as of December 31, 2018 and 2017 . |
Regulatory Matters
Regulatory Matters | 12 Months Ended |
Dec. 31, 2018 | |
Banking and Thrift [Abstract] | |
Regulatory Matters | Regulatory Matters The Company and the Bank are subject to various regulatory and capital requirements administered by the Federal banking agencies. Our federal banking regulators, the Board of Governors of the Federal Reserve System (the “Federal Reserve”) (which regulates bank holding companies) and the Federal Deposit Insurance Corporation (the “FDIC”) (which regulated the Bank), have issued guidelines classifying and defining capital. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions that, if undertaken, could have a direct material effect on the Company’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and the Bank must meet specific capital guidelines that involve quantitative measures of their assets, liabilities and certain off-balance sheet items as calculated under regulatory accounting practices. The capital amounts and classification of the Company and the Bank is also subject to qualitative judgments by the regulators about components, risk weightings and other factors. Under the New Jersey Banking Act (the “Banking Act”), no dividend may be paid by the Bank on its capital stock unless, following the payment of each such dividend, the capital stock of the Bank will be unimpaired, and the Bank will have a surplus of not less than 50% of its capital stock. Therefore the highest amount of dividends that the Bank could pay to the Company at December 31, 2018 under the Banking Act is $100.2 million , subject to amounts it needs to retain in order to remain “well capitalized” as set forth below. Under Federal Reserve regulations, the Bank is limited as to the amount it may lend affiliates, including the Company, unless such loans are collateralized by specific obligations. Quantitative measures established by regulation to ensure capital adequacy require the Company and the Bank to maintain minimum amounts and ratios, set forth in the following tables of Tier 1 Capital to Average Assets (Leverage Ratio), Common Equity Tier 1 Capital to Risk Weighted Assets, Tier 1 Capital to Risk Weighted Assets and Total Capital to Risk Weighted Assets. Management believes that, at December 31, 2018 , the Company and the Bank met all capital adequacy requirements to which they are subject. As of December 31, 2018 , the Company and the Bank met all regulatory requirements for classification as well-capitalized under the applicable regulatory framework. Management believes that there are no conditions or events that have changed the classification. The capital ratios of the Company and the Bank, at December 31, 2018 and 2017 , are presented below. Actual For Capital Adequacy Purposes To be Well Capitalized under Prompt Corrective Action Regulations* Amount Ratio Amount Ratio Amount Ratio (Dollars in Thousands) As of December 31, 2018 Common Equity Tier 1 Capital (to risk weighted assets) Two River Bancorp $ 98,758 10.14 % $ > 43,808 > 4.50% N/A N/A Two River Community Bank 107,891 11.09 % > 43,782 > 4.50% $ >63,240 > 6.50% Total Capital (to risk weighted assets) Two River Bancorp 120,156 12.34 % > 77,882 > 8.00% N/A N/A Two River Community Bank 119,289 12.26 % > 77,834 > 8.00% > 97,293 > 10.00% Tier 1 Capital (to risk weighted assets) Two River Bancorp 98,758 10.14 % > 58,411 > 6.00% > 58,411 > 6.00% Two River Community Bank 107,891 11.09 % > 58,376 > 6.00% > 77,834 > 8.00% Tier 1 Capital (to average assets) Two River Bancorp 98,758 9.10 % > 43,389 > 4.00% N/A N/A Two River Community Bank 107,891 9.95 % > 43,363 > 4.00% > 54,204 > 5.00% As of December 31, 2017 Common Equity Tier 1 Capital (to risk weighted assets) Two River Bancorp $ 88,733 9.68 % $ > 41,250 > 4.50% N/A N/A Two River Community Bank 97,723 10.66 % > 41,253 > 4.50% $ > 59,587 > 6.50% Total Capital (to risk weighted assets) Two River Bancorp 109,401 11.93 % > 73,362 > 8.00% N/A N/A Two River Community Bank 108,391 11.82 % > 73,361 > 8.00% > 91,701 > 10.00% Tier 1 Capital (to risk weighted assets) Two River Bancorp 88,733 9.68 % > 55,000 > 6.00% > 55,000 > 6.00% Two River Community Bank 97,723 10.66 % > 55,004 > 6.00% > 73,338 > 8.00% Tier 1 Capital (to average assets) Two River Bancorp 88,733 8.85 % > 40,105 > 4.00% N/A N/A Two River Community Bank 97,723 9.76 % > 40,050 > 4.00% > 50,063 > 5.00% *Applies to the Bank only. For the Company to be “well-capitalized”, the Tier 1 Capital to Risk Weighted Assets has to be at least 6.00% . The risk-based capital rules require that banks and holding companies maintain a “capital conservation buffer” of 250 basis points in excess of the “minimum capital ratio.” The minimum capital ratio is equal to the prompt corrective action adequately capitalized threshold ratio. Failure to maintain the required capital conservation buffer will result in limitations on capital distributions and on discretionary bonuses to executive officers. Effective January 1, 2018, the capital levels required for the Company and the Bank to avoid these limitations were as follows: (i) a common equity Tier 1 capital ratio of 6.375% ; (ii) a Tier 1 Risk based capital ratio of 7.875% ; and (iii) a Total Risk based capital ratio of 9.875% . As of December 31, 2018 , the Bank had a conservation buffer greater than 2.5% in excess of each of the required ratios to be adequately capitalized. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Accounting guidance establishes a fair value hierarchy that prioritizes the inputs to valuation methods used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows: Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. Level 2: Quoted prices in markets that are not active, or inputs that are observable either directly or indirectly, for substantially the full term of the asset or liability. Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e. supported with little or no market activity). An asset’s or liability’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. For financial assets measured at fair value on a recurring basis, the fair value measurements by level within the fair value hierarchy used at December 31, 2018 and 2017 are as follows: Description (Level 1) Quoted Prices in Active Markets for Identical Assets (Level 2) Significant Other Observable Inputs (Level 3) Significant Unobservable Inputs Total (In Thousands) At December 31, 2018 Securities available for sale: U.S. Government agency securities $ — $ 11,635 $ — $ 11,635 Municipal securities — 487 — 487 GSE – Residential mortgage-backed securities — 5,947 — 5,947 U.S. Government collateralized residential mortgage obligations — 4,423 — 4,423 Corporate debt securities, primarily financial institutions — 1,915 — 1,915 Total securities available for sale $ — $ 24,407 $ — $ 24,407 Total Equity Securities $ 2,451 $ — $ — $ 2,451 At December 31, 2017 Securities available for sale: U.S. Government agency securities $ — $ 10,057 $ — $ 10,057 Municipal securities — 495 — 495 GSE – Residential mortgage-backed securities — 8,219 — 8,219 U.S. Government collateralized residential mortgage obligations — 7,482 — 7,482 Corporate debt securities, primarily financial institutions — 2,431 — 2,431 Total securities available for sale $ — $ 28,684 $ — $ 28,684 Total Equity Securities $ 2,448 $ — $ — $ 2,448 As of December 31, 2018 and 2017 , there were no securities available for sale measured at fair value on a recurring basis using significant unobservable inputs (Level 3). For assets measured at fair value on a nonrecurring basis, the fair value measurements by level within the fair value hierarchy used at December 31, 2018 and 2017 are as follows: Description (Level 1) Quoted Prices in Active Markets for Identical Assets (Level 2) Significant Other Observable Inputs (Level 3) Significant Unobservable Inputs Total (In Thousands) At December 31, 2018 OREO $ — $ — $ 585 $ 585 At December 31, 2017 Impaired loans, net of allowance recorded $ — $ — $ 116 $ 116 The Company’s policy is to recognize transfers between levels as of the beginning of the period. There were no transfers between Levels 1, 2 and 3 for the years ended December 31, 2018 and 2017 . The following valuation techniques were used to measure fair value of assets in the tables above: • Impaired loans – Impaired loans measured at fair value are those loans in which the Company has measured impairment generally based on the fair value of the loan’s collateral. Fair value is generally determined based upon either independent third party appraisals of the properties or discounted cash flows based upon the expected proceeds. The appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated liquidation expenses. At December 31, 2018 and 2017, there were no loans that received a discount to their appraised values. At December 31, 2018 and 2017, there were no liquidation expenses. These assets are included as Level 3 fair values, based upon the lowest level of input that is significant to the fair value measurements. • OREO – Real estate properties acquired through, or in lieu of, loan foreclosure are carried at fair value less cost to sell. Fair value is based upon the appraised value of the collateral, adjusted by management for factors such as economic conditions and other market factors. At December 31, 2018, the discount and liquidation expenses for collateral adjustments to our OREO property was 9.5% . These assets are included in Level 3 fair value based upon the lowest level of input that is significant to the fair value measurement. At December 31, 2018 , OREO totaling $ 585,000 were acquired by deed in lieu of foreclosure and are carried at fair value less estimated selling costs based on current appraisals. At December 31, 2017 , the Company had no properties held in OREO. As of December 31, 2018 and 2017, the Company initiated foreclosure proceedings on three loans and one loan secured by real estate in the amount of $598,000 and $490,000 , respectively. The following information should not be interpreted as an estimate of the fair value of the entire Company since a fair value calculation is only provided for a limited portion of the Company’s assets and liabilities. Due to a wide range of valuation techniques and the degree of subjectivity used in making the estimates, comparisons between the Company’s disclosures and those of other companies may not be meaningful. The following methods and assumptions were used to estimate the fair values of the Company’s financial instruments at December 31, 2018 and 2017 : Securities : The fair value of securities available-for-sale (carried at fair value) and held to maturity (carried at amortized cost) are determined by obtaining quoted market prices on nationally recognized securities exchanges (Level 1), or matrix pricing (Level 2), which is a mathematical technique used widely in the industry to value debt securities without relying exclusively on quoted market prices for the specific securities but rather by relying on the securities’ relationship to other benchmark quoted prices. For certain securities which are not traded in active markets or are subject to transfer restrictions, valuations are adjusted to reflect illiquidity and/or non-transferability, and such adjustments are generally based on available market evidence (Level 3). At December 31, 2018 and 2017 , there were no Level 3 securities. The estimated fair values of the Company’s financial instruments at December 31, 2018 and 2017 were as follows: Fair Value Measurements at December 31, 2018 (in thousands) Carrying Amount Estimated Fair Value (Level 1) Quoted Prices in Active Markets for Identical Assets (Level 2) Significant Other Observable Inputs (Level 3) Significant Unobservable Inputs Financial assets: Cash and cash equivalents $ 48,126 $ 48,126 $ 48,126 $ — $ — Securities available for sale 24,407 24,407 — 24,407 — Securities held to maturity 47,455 47,266 — 47,266 — Equity securities 2,451 2,451 2,451 — — Restricted investments 6,082 6,082 — — 6,082 Loans held for sale 1,496 1,525 — — 1,525 Loans receivable, net 909,903 887,374 — — 887,374 Accrued interest receivable 2,583 2,583 — 643 1,940 Financial liabilities: Deposits 917,354 915,435 — 915,435 — Securities sold under agreements to repurchase 19,402 19,402 — 19,402 — FHLB and other borrowings 22,500 21,966 — 21,966 — Subordinated debt 9,923 9,999 — 9,999 — Accrued interest payable 119 119 — 119 — Fair Value Measurements at December 31, 2017 (in thousands) Carrying Amount Estimated Fair Value (Level 1) Quoted Prices in Active Markets for Identical Assets (Level 2) Significant Other Observable Inputs (Level 3) Significant Unobservable Inputs Financial assets: Cash and cash equivalents $ 48,219 $ 48,219 $ 48,219 $ — $ — Securities available for sale 28,684 28,684 28,684 — Securities held to maturity 58,002 58,549 — 58,549 — Equity securities 2,448 2,448 2,448 — — Restricted investments 5,430 5,430 — — 5,430 Loans held for sale 2,581 2,738 — — 2,738 Loans receivable, net 840,206 841,477 — — 841,477 Accrued interest receivable 2,554 2,554 — 638 1,916 Financial liabilities: Deposits 861,557 860,129 — 860,129 — Securities sold under agreements to repurchase 27,120 27,120 — 27,120 — FHLB and other borrowings 25,800 25,382 — 25,382 — Subordinated debt 9,888 9,812 — 9,812 — Accrued interest payable 70 70 — 70 — |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Dec. 31, 2018 | |
Stockholders' Equity Note [Abstract] | |
Shareholders' Equity | Shareholders’ Equity From January 1, 2018 until December 31, 2018, the Company maintained a Share Repurchase Program under which the Company repurchased 16,351 shares for a total price of approximately $251,000 . This program expired on December 31, 2018. On January 24, 2019, the Company announced that its Board of Directors approved a new Share Repurchase Program. This new program allows for the Company to repurchase up to $2 million of its common stock from January 31, 2019 to December 31, 2019. |
Condensed Financial Statements
Condensed Financial Statements of Parent Company | 12 Months Ended |
Dec. 31, 2018 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Condensed Financial Statements of Parent Company | Condensed Financial Statements of Parent Company Condensed financial information pertaining to the parent company, Two River Bancorp, is as follows: Condensed Balance Sheets December 31, 2018 2017 (In Thousands) Assets Cash and cash equivalents $ 355 $ 41 Investments in subsidiaries 125,631 115,507 Other assets 591 1,067 Total assets $ 126,577 $ 116,615 Liabilities and Shareholders’ Equity Subordinated debt $ 9,923 $ 9,888 Other liabilities 156 156 Shareholders’ equity 116,498 106,571 Total liabilities and shareholders’ equity $ 126,577 $ 116,615 Condensed Statements of Operations and Comprehensive Income December 31, 2018 2017 2016 (In Thousands) Dividends from Bank $ 1,533 $ 1,578 $ 1,636 Interest expense - subordinated debt 660 658 656 Other operating expenses 317 279 233 Income before income taxes 556 641 747 Income tax benefit (406 ) (483 ) (239 ) Income before undistributed income of subsidiaries 962 1,124 986 Equity in undistributed income of subsidiaries 10,244 5,378 7,645 Net income $ 11,206 $ 6,502 $ 8,631 Equity in other comprehensive income (loss) of subsidiaries, net of tax (121 ) 87 8 Total comprehensive income, net of tax $ 11,085 $ 6,589 $ 8,639 Condensed Statements of Cash Flows December 31, 2018 2017 2016 (In Thousands) Cash flows from operating activities: Net income $ 11,206 $ 6,502 $ 8,631 Adjustments to reconcile net income to net cash provided by operating activities: Equity in undistributed income of subsidiaries, net of dividends received from Bank (10,244 ) (5,378 ) (7,645 ) Amortization of subordinated debt issuance costs 35 33 31 Stock-based compensation expense 317 279 231 Other, net 475 (543 ) (264 ) Net cash provided by operating activities 1,789 893 984 Cash flows from investing activities: Contributions to subsidiary, net — — — Net cash used in investing activities — — — Cash flows from financing activities: Proceeds from exercise of stock options 423 276 104 Tax benefit relating to stock compensation — 59 25 Proceeds from employee stock purchase program 63 67 56 Redemption of preferred stock, Series C — — — Proceeds from subordinated debt placement, net of issuance costs — — — Common stock repurchased (251 ) — (148 ) Cash dividends paid on common stock (1,710 ) (1,415 ) (1,193 ) Dividends paid on preferred stock, Series C — — — Net cash provided by (used in) financing activities (1,475 ) (1,013 ) (1,156 ) Net increase (decrease) in cash and cash equivalents 314 (120 ) (172 ) Cash and Cash Equivalents - Beginning 41 161 333 Cash and Cash Equivalents – Ending $ 355 $ 41 $ 161 |
Summary of Quarterly Results (U
Summary of Quarterly Results (Unaudited) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Summary of Quarterly Results (Unaudited) | Summary of Quarterly Results (Unaudited) The following summarizes the consolidated results of operations during 2018 and 2017, on a quarterly basis, for Two River Bancorp. Note that certain balances may not cross-foot due to rounding. (in thousands, except per share data): 2018 Fourth Quarter Third Quarter Second Quarter First Quarter Interest income $ 11,776 $ 11,342 $ 10,907 $ 10,467 Interest expense 2,523 2,239 1,937 1,667 Net interest income 9,253 9,103 8,970 8,800 Provision for loan losses — 150 225 400 Net interest income after provision for loan losses 9,253 8,953 8,745 8,400 Non-interest income 1,370 1,355 1,496 1,310 Non-interest expense 6,447 6,461 6,551 6,227 Income before income taxes 4,176 3,847 3,690 3,483 Income taxes 1,130 1,013 1,040 807 Net income $ 3,046 $ 2,834 $ 2,650 $ 2,676 Per common share data: Basic earnings $ 0.36 $ 0.33 $ 0.31 $ 0.32 Diluted earnings $ 0.35 $ 0.33 $ 0.30 $ 0.31 2017 Fourth Quarter Third Quarter Second Quarter First Quarter Interest income $ 10,074 $ 9,824 $ 9,349 $ 8,993 Interest expense 1,545 1,408 1,391 1,363 Net interest income 8,529 8,416 7,958 7,630 Provision for loan losses 675 255 375 225 Net interest income after provision for loan losses 7,854 8,161 7,583 7,405 Non-interest income 1,343 1,453 1,538 1,125 Non-interest expense 5,919 6,175 6,071 5,777 Income before income taxes 3,278 3,439 3,050 2,753 Income taxes 2,943 1,202 922 951 Net income $ 335 $ 2,237 $ 2,128 $ 1,802 Per common share data: Basic earnings $ 0.04 $ 0.27 $ 0.25 $ 0.22 Diluted earnings $ 0.04 $ 0.26 $ 0.25 $ 0.21 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Organization and Basis of Presentation | Organization and Basis of Presentation The accompanying consolidated financial statements include the accounts of Two River Bancorp (the “Company”), a bank holding company, and its wholly-owned subsidiary, Two River Community Bank (“the Bank” or “Two River”) and the Bank’s wholly-owned subsidiary, TRCB Investment Corporation. All inter-company balances and transactions have been eliminated in the consolidated financial statements. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The principal material estimates that are particularly susceptible to significant change in the near term related to: the allowance for loan losses, the potential impairment of goodwill, the valuation of deferred tax assets, valuation of other real estate owned and the determination of other-than-temporary impairment on securities. |
Significant Concentrations of Credit Risk | Significant Concentrations of Credit Risk Most of the Company’s activities are with customers located within Monmouth, Middlesex, Union and Ocean Counties of New Jersey. Note 3 discusses the types of securities that the Company invests in. Note 4 discusses the types of lending that the Company engages in. Although the Company actively manages the diversification of its loan portfolio, a substantial portion of its debtors’ ability to honor their contracts is dependent upon the strength of the local economy. The loan portfolio includes commercial real estate, which is comprised of owner occupied and investment real estate, including general office, medical, manufacturing and retail space. Construction loans, short-term in nature, comprise another portion of the portfolio, along with commercial and industrial loans. The latter includes lines of credit and equipment loans. From time to time, the Company may purchase or sell an interest in a loan from or to another lender (participation loan) in order to manage its portfolio risk. Loans purchased by the Company are typically located in New Jersey and meet the Company’s own independent underwriting guidelines. The Company does not have any significant concentrations in any one industry or customer. |
Comprehensive Income | Comprehensive Income Comprehensive income consists of net income and other comprehensive income (loss). Other comprehensive income (loss) includes unrealized gains and losses on securities available for sale and unrealized losses related to factors other than credit on debt securities which have been determined to be other-than-temporarily impaired. |
Statement of Cash Flows | Statement of Cash Flows For purposes of reporting cash flows, cash and cash equivalents include cash on hand, amounts due from banks, interest-bearing deposits in banks, and Federal funds sold. Interest-bearing deposits are due from the Federal Reserve Bank of New York. Generally, Federal funds are purchased and sold for one-day periods. |
Securities | Securities Securities classified as available for sale are those securities that the Company intends to hold for an indefinite period of time but not necessarily to maturity. Securities available for sale are carried at fair value. Any decision to sell a security classified as available for sale would be based on various factors, including significant movement in interest rates, changes in maturity mix of the Company’s assets and liabilities, liquidity needs, regulatory capital considerations and other similar factors. Unrealized gains or losses are reported as increases or decreases in other comprehensive income (loss), net of the related deferred tax effect. Realized gains or losses, determined on the basis of the cost of the specific securities sold, are included in earnings. Premiums and discounts are recognized in interest income using the interest method over the terms of the securities. Gains and losses on the sale of securities available for sale are recorded on the trade date and are determined using the specific identification method. Securities classified as held to maturity are those securities the Company has both the intent and ability to hold to maturity regardless of changes in market conditions, liquidity needs or changes in general economic conditions. These securities are carried at cost adjusted for the amortization of premium and accretion of discount, computed by the interest method over the terms of the securities. Management determines the appropriate classification of debt securities at the time of purchase and re-evaluates such designation as of each balance sheet date. Other-than-temporary accounting guidance specifies that (a) if a company does not have the intent to sell a debt security prior to recovery and (b) it is more likely than not that it will not have to sell the debt security prior to recovery, the security would not be considered other-than-temporary impaired unless there is a credit loss. When an entity does not intend to sell the security, and it is more likely than not, the entity will not have to sell the security before recovery of its cost basis, it will recognize the credit component of an other-than-temporary impairment of a debt security in earnings and the remaining portion in other comprehensive income (loss). For held to maturity debt securities, the amount of an other-than-temporary impairment recorded in other comprehensive income (loss) for the noncredit portion of a previous other-than-temporary impairment should be amortized prospectively over the remaining life of the security on the basis of the timing of future cash flows of the security. The Company has equity securities, which consists solely of the CRA Mutual Fund. Net unrealized gains and losses are recognized through earnings beginning January 1, 2018 after the adoption of ASU 2016-01. |
Restricted Investments | Restricted Investments Restricted investments, which represents the required investment in the common stock of correspondent banks, is carried at cost and as of December 31, 2018 and 2017 , consists of the common stock of the Federal Home Loan Bank of New York (“FHLB”) and Atlantic Community Bancshares, Inc. (“ACBI”), the parent company of Atlantic Community Bankers Bank. Federal law requires a member institution of the FHLB to hold stock of its district FHLB according to a predetermined formula. The recorded investment in FHLB common stock was $4,507,600 and $3,855,800 at December 31, 2018 and 2017 , respectively. The recorded investment in ACBI common stock was $75,000 at December 31, 2018 and 2017 . Restricted investments also include the Solomon Hess SBA Loan Fund, utilized for the purpose of the Bank satisfying its CRA lending requirements. As this fund operates as a private fund, shares in the Fund are not publicly traded and therefore have no readily determinable market value. An investor can have their interest in the Fund redeemed for the balance of their capital account at any quarter end assuming they give the Fund 60 days’ notice. This fund is an equity security without a readily determinable fair value that we have elected to record at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for an identical or similar investment of the same issuer in accordance with ASU 2016-01. The carrying value is $1,500,000 at December 31, 2018 and 2017 . Management evaluates the restricted investments for impairment in accordance with U.S. generally accepted accounting principles. Management’s determination of whether these investments are impaired is based on their assessment of the ultimate recoverability of their cost rather than by recognizing temporary declines in value. |
Loans Receivable and Loans Held for Sale | Loans Receivable and Loans Held for Sale Loans receivable, which management has the intent and ability to hold for the foreseeable future or until maturity or payoff are stated at their outstanding unpaid principal balances, net of an allowance for loan losses and any deferred fees or costs. Interest income is accrued on the unpaid principal balance. Loan origination fees, net of certain direct origination costs, are deferred and recognized as an adjustment of the yield (interest income) of the related loans. The Company is generally amortizing these amounts over the contractual life of the loan. Loans held for sale are designated at time of origination. They generally consist of newly originated fixed rate residential loans and salable SBA loans and are recorded at the lower of aggregate cost or estimated fair value in the aggregate. The Company typically retains adjustable-rate mortgage (“ARM”) loans in its portfolio, however occasionally, the Company may elect to sell a small pool of these loans as part of its strategy to manage interest rate risk or as a secondary source of liquidity. The Company transferred $9.8 million from held for investment to held for sale in 2018 , while $8.2 million such loans were transferred in 2017 . The Company did not transfer any loans from held for investment to held for sale in 2016. Gains from such sales were $200,000 , $177,000 , and $0 for the years ended December 31, 2018, 2017 and 2016, respectively. Transfers from held for investment are infrequent and occur at lower of cost or fair value, less costs to sell. Gains are recognized on a settlement-date basis and are determined by the difference between the net sales proceeds and the carrying value of the loans, including any net deferred fees or costs. Depending on the type of loan sold, servicing may or may not be retained. The loans receivable portfolio is segmented into five categories, those being a) Commercial and industrial, b) Real estate-construction (consisting of both residential and commercial construction), c) Real estate-commercial, d) Real estate-residential, and e) Consumer. For all classes of loans receivable, the accrual of interest is discontinued when the contractual payment of principal or interest has become 90 days past due or management has serious doubts about further collectability of principal or interest, even though the loan is currently performing. A loan may remain on accrual status if it is in the process of collection and is either guaranteed or well secured. When a loan is placed on nonaccrual status, unpaid interest previously accrued on these loans is reversed from income. Interest received on nonaccrual loans, including impaired loans, generally is either applied against principal or reported as interest income, according to management’s judgment as to the collectability of principal. Generally, loans are restored to accrual status when the obligation is brought current, has performed in accordance with the contractual terms for a reasonable period of time (generally six months) and the ultimate collectability of the total contractual principal and interest is no longer in doubt. The past due status of all classes of loans receivable is determined based on contractual due dates for loan payments. |
Allowance for Loan Losses | Allowance for Loan Losses The allowance for credit losses consists of the allowance for loan losses and the reserve for unfunded lending commitments. The allowance for loan losses represents management’s estimate of losses inherent in the loan portfolio as of the balance sheet date and is recorded as a reduction to loans. The reserve for unfunded lending commitments represents management’s estimate of losses inherent in its unfunded loan commitments and is recorded in other liabilities on the consolidated balance sheet, which at December 31, 2018 and 2017 , the Company had no such reserves. The allowance for loan losses is increased by the provision for loan losses, and decreased by charge-offs, net of recoveries. Loans deemed to be uncollectable are charged against the allowance for loan losses, and subsequent recoveries, if any, are credited to the allowance. All, or part, of the principal balance of loans receivable are charged off to the allowance as soon as it is determined that the repayment of all, or part, of the principal balance is highly unlikely. The allowance for loan losses is maintained at a level considered adequate to provide for losses that can be reasonably anticipated. Management performs a monthly evaluation of the adequacy of the allowance. The allowance is based on the Company’s past loan loss experience, known and inherent risks in the portfolio, adverse situations that may affect the borrower’s ability to repay, the estimated value of any underlying collateral, composition of the loan portfolio, current economic conditions and other relevant factors. This evaluation is inherently subjective as it requires material estimates that may be susceptible to significant revision as more information becomes available. The allowance consists of specific, general and unallocated components. For loans that are classified as impaired, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan is lower than the carrying value of the loan. The specific component relates to loans that are classified as impaired. When a loan is impaired, there are three acceptable methods under ASC 310-10-35 for measuring the impairment: 1. The loan's observable market price; 2. The fair value of the underlying collateral; or 3. The present value (PV) of expected future cash flows. Loans that are considered “collateral-dependent” should be evaluated under the “Fair market value of collateral.” Loans that are still expected to be supported by repayment from the borrower should be evaluated under the “Present value of future cash flows.” For the most part, the Company measures impairment under the “Fair market value of collateral” for any loan that would rely on the value of collateral for recovery in the event of default. The individual impairment analysis for each loan is clearly documented as to the chosen valuation method. The general component covers pools of loans by loan class including commercial and industrial, real estate-construction and real estate-commercial not considered impaired as well as smaller balance homogeneous loans such as real estate-residential and consumer. These pools of loans are evaluated for loss exposure based upon historical loss rates for each of these categories of loans, adjusted for qualitative factors. These qualitative risk factors include: 1. Changes in lending policy and procedures, including changes in underwriting standards and collection practices not previously considered in estimating credit losses. 2. Changes in relevant economic and business conditions. 3. Changes in nature and volume of the loan portfolio and in the terms of loans. 4. Changes in experience, ability and depth of lending management and staff. 5. Changes in the volume and severity of past due loans, the volume of non-accrual loans and the volume and severity of adversely classified loans. 6. Changes in the quality of the loan review system. 7. Changes in the value of underlying collateral for collateral-dependent loans. 8. The existence and effect of any concentration of credit and changes in the level of such concentrations. 9. The effect of other external forces such as competition, legal and regulatory requirements on the level of estimated credit losses in the existing portfolio. Each factor is assigned a risk value to reflect low, moderate or high risk assessment levels based on management’s best judgment using current market, macro and other relevant information available at the time of the evaluation. Adjustments to the factors are supported through documentation in each factor and accompany the allowance for loan loss calculation. During the fourth quarter of 2018, Management employed a more refined estimation in determining the risk levels assigned to each of its qualitative factors in the allowance for loan losses. While this did not result in a significant change to the allowance for loan losses as a whole, it did result increasing or decreasing the provision for certain loan categories that the Company either had experienced more or less historical net charge-offs. An unallocated component is maintained to cover uncertainties that could affect management’s estimate of probable losses. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating specific and general losses in the portfolio. The Company engages in a variety of lending activities, including commercial and industrial, real estate-commercial, real estate-construction, real estate-residential and consumer loans. The Company focuses its lending activities on individuals, professionals along with small to medium sized businesses. The Company originates commercial business loans to professionals, sole proprietorships and small businesses in our market areas. We extend commercial business loans on a secured and unsecured basis. Secured commercial loans are generally collateralized by residential and nonresidential real estate, marketable securities, accounts receivable, inventory, industrial/commercial machinery and equipment and furniture and fixtures. To further enhance our security position, we generally require personal guarantees of the principal owners of the entities to which we extend credit. These loans are made on both lines of credit and fixed-term basis typically ranging from one to five years in duration. When making commercial business loans, we consider the financial statements and/or tax returns of the borrower, the borrower’s payment history along with the principal owners’ payment history, the debt service capabilities of the borrower, the projected cash flows of the business, and the value of the collateral and the financial strength of the guarantor. Commercial real estate loans are made to local commercial, retail and professional firms and individuals for the acquisition of new property or the refinancing of existing property. These loans are typically related to commercial businesses and secured by the underlying real estate used in these businesses or real property of the principals. Commercial real estate loans typically require a loan to value ratio of not greater than 75% . These loans are generally offered on a fixed or variable rate basis, subject to rate re-adjustments every five years and amortization schedules ranging from 5 to 25 . Commercial loans are often larger and may involve greater risks than other types of lending. Because payments of such loans are often dependent on the successful operation of the business involved, repayment of such loans may be more sensitive than other types of loans and are subject to adverse conditions in the real estate market or the general economy. We are also involved with off-balance sheet financial instruments, which include collateralized commercial and standby letters of credit. We seek to minimize these risks through our underwriting guidelines and prudent risk management techniques. Any collateral securing such loans may depreciate over time, may be difficult to appraise and may fluctuate in value. Environmental surveys and inspections are obtained when circumstances suggest that the possibility of the presence of hazardous materials. There can be no assurances, however, of success in the efforts to minimize these risks. The Company is an approved Preferred Lender by the Small Business Administration (“SBA”), which allows the Company delegated authority to approve and close SBA loans up to $5.0 million . The Company maintains prudent credit risk management to monitor and evaluate the value of real estate and other collateral used to secure SBA loans. All SBA loans are originated in compliance with all applicable federal lending regulations, including but not limited to the Equal Credit Opportunity Act. The Bank currently participates in SBA’s 7a and 504 loan programs, which typically provide guarantees up to 75% per loan. The Bank typically sells the guaranteed portion of SBA loans and retains the unguaranteed portion ("retained interest"). A portion of the premium on the sale of SBA loans is recognized as gain on sale of loans at the time of the sale by allocating the carrying amount between the asset sold and the retained interest, including servicing assets, based on their relative fair values. The remaining portion of the premium is recorded as a discount on the remaining life of the loan as an adjustment to yield. The retained interest, net of any discount, is included in loans in the accompanying consolidated balance sheets. Servicing assets are amortized in proportion to, and over the period of, the estimated net servicing income or net servicing loss and measured for impairment based on fair value at each reporting date. The amortization of the servicing rights is analyzed periodically and is adjusted to reflect changes in prepayment rates and other estimates. Serviced loans sold to others is not included in the balance sheets. The unpaid principal balances of loans serviced for others were $41.5 million and $32.9 million at December 31, 2018 and 2017, respectively. Income (losses) and fees collected for servicing are included within Other Loan Fees on the statements of operations, and totaled $220,000 , $172,000 , and $100,000 for the years ended December 31, 2018, 2017 and 2016, respectively. The servicing assets recorded as of December 31, 2018 and 2017 are not material. Our philosophy remains to be prudent and focused on the cash flow of the businesses and financial strength of the guarantors. The Company originates fixed-rate and adjustable-rate loans to individuals and builders to finance the construction of residential dwellings. We also originate construction loans for commercial development projects, including apartment buildings, restaurants, shopping centers and owner-occupied properties used for businesses. Our construction loans generally provide for the payment of interest only during the construction phase which is typically twelve months for residential properties and twelve to eighteen months for commercial properties. At the end of the construction phase, the loan is either converted to a permanent mortgage loan or paid off. Before making a commitment to fund a construction loan, we require an appraisal and an environmental analysis of the property performed by a bank approved independent licensed appraiser and environmental consultant, an inspection of the property before disbursement of funds during the stages of the construction process, and approval from an identified source for the permanent takeout. Additionally, the borrower must demonstrate the ability to service the debt during the construction term. The Company offers a full range of residential real estate and consumer loans. These loans consist of residential mortgages, home equity lines of credit, equity loans, personal loans, automobile loans and overdraft protection. We do not originate subprime or negative amortization loans. Each residential mortgage loan is evidenced by a promissory note secured by a mortgage or deed of trust creating a first lien on one-to-four family residential property. Residential real estate properties underlying residential mortgage loans consist of single-family detached units, individual condominium units, two-to-four family dwellings units and townhouses. Our home equity revolving lines of credit come with a floating interest rate tied to the prime rate. Lines of credit are available to qualified applicants in amounts up to $350,000 for up to 15 years years. We also offer fixed rate home equity loans in amounts up to $350,000 for a term of up to 15 years. Credit is based on the income and cash flow of the individual borrowers, real estate collateral supporting the mortgage debt and past credit history. Consumer loans may entail greater risk than residential mortgage loans, particularly in the case of consumer loans that are unsecured or secured by assets that depreciate in value rapidly. In such cases, repossessed collateral for a defaulted consumer loan may not provide an adequate source of repayment for the outstanding loan and the remaining deficiency often does not warrant further substantial collection efforts against the borrower. In addition, consumer loan collections depend on the borrower’s continuing financial stability, and therefore are more likely to be adversely affected by job loss, divorce, illness or personal bankruptcy. Furthermore, the application of various federal and state laws, including bankruptcy and insolvency laws, may limit the amount that can be recovered on such loans. A loan is considered impaired when it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record and the amount of the shortfall in relation to the principal and interest owed. Impairment is measured on a loan by loan basis for commercial and industrial, real estate-commercial, real estate-construction, real estate-residential and consumer loans by either the present value of expected future cash flows discounted at the loan’s effective interest rate or the fair value of the collateral if the loan is collateral dependent. An allowance for loan losses is established for an impaired loan if its carrying value exceeds its estimated fair value. The estimated fair values of substantially all of the Company’s impaired loans are measured based on the estimated fair value of the loan’s collateral. For commercial loans secured by real estate, estimated fair values are determined primarily through third-party appraisals. When a real estate secured loan becomes impaired, a decision is made regarding whether an updated certified appraisal of the real estate is necessary. This decision is based on various considerations, including the age of the most recent appraisal, the loan-to-value ratio based on the original appraisal and the condition of the property. Appraised values are discounted to arrive at the estimated selling price of the collateral, which is considered to be the estimated fair value. The discounts also include estimated costs to sell the property. For commercial loans secured by non-real estate collateral, such as accounts receivable, inventory and equipment, estimated fair values are determined based on the borrower’s financial statements, inventory reports, accounts receivable aging or equipment appraisals or invoices. Indications of value from these sources are generally discounted based on the age of the financial information or the quality of the assets. Loans whose terms are modified are classified as troubled debt restructurings (“TDRs”) if the Company grants such borrowers concessions and it is deemed that those borrowers are experiencing financial difficulty. Concessions granted under a TDR generally involve a temporary reduction in interest rate or a modification of a loan’s amortization schedule. Non-accrual TDRs are restored to accrual status if principal and interest payments, under the modified terms, are current for six consecutive months after the modification is in place. Loans classified as TDRs, including those restored to accrual status, are designated as impaired. The Company’s TDR modifications are made on terms typically up to 12 months in order to aggressively monitor and track performance. The short-term modifications performances are monitored for continued payment performance for an additional period of time after the expiration of the concession. Balance reductions and annualized loss rates are also important metrics that are monitored. The main objective of the modification programs is to reduce the payment burden for the borrower and to deleverage the Company’s exposure. The allowance calculation methodology includes further segregation of loan classes into risk rating categories. The borrower’s overall financial condition, repayment sources, guarantors and value of collateral, if appropriate, are evaluated annually for commercial loans or when credit deficiencies arise, such as delinquent loan payments, for commercial and consumer loans. Credit quality risk ratings include regulatory classifications of special mention, substandard, doubtful and loss. Loans classified special mention have potential weaknesses that deserve management’s close attention. If uncorrected, the potential weaknesses may result in deterioration of the repayment prospects. Loans classified substandard have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They include loans that are inadequately protected by the current sound net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans classified doubtful have all the weaknesses inherent in loans classified substandard with the added characteristics that collection or liquidation in full, on the basis of current conditions and facts, is highly improbable. Loans classified as a loss are considered uncollectable and are charged to the allowance for loan losses. Loans not classified are rated pass. In addition, federal and state regulatory agencies, as an integral part of their examination process, periodically review the Company’s allowance for loan losses and may require the Company to recognize additions to the allowance based on their judgments about information available to them at the time of their examination, which may not be currently available to management. Based on management’s comprehensive analysis of the loan portfolio, management believes the current level of the allowance for loan losses is adequate. |
Transfers of Financial Assets | Transfers of Financial Assets Transfers of financial assets, including sale of loans and loan participation sales, are accounted for as sales, when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when (1) the assets have been isolated from the Company, (2) the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets and (3) the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity. |
Other Real Estate Owned | Other Real Estate Owned Other Real Estate Owned (“OREO”) includes real estate acquired through foreclosure or by deed in lieu of foreclosure. OREO is initially recorded at fair value less cost to sell at the date of foreclosure, establishing a new cost basis. Any write-downs based on fair value less costs to sell at the date of foreclosure are charged to the allowance for loan losses. If at the time of foreclosure, the fair value less costs to sell is greater than the loan balance, the resulting gain is recognized at the time of foreclosure unless there has been a prior charge-off, in which case a recovery to the allowance for loan losses is recorded. Subsequent to foreclosure, valuations are periodically performed by management and the assets are carried at the lower of carrying amount or fair value less cost to sell. Operating results from real estate owned, including rental income, operating expenses, and gains and losses realized from the sales of real estate owned, are recorded as incurred. |
Bank Owned Life Insurance | Bank Owned Life Insurance The Company invests in bank owned life insurance (“BOLI”) as a source of funding for employee benefit expenses. BOLI involves the purchasing of life insurance by the Company’s wholly-owned trust on a chosen group of officers and directors. The Company is the owner and beneficiary of the policies. This life insurance investment is carried at the cash surrender value of the underlying policies. Income generated from the increase in cash surrender value of the policies is included in non-interest income on the statements of operations. |
Bank Premises and Equipment | Bank Premises and Equipment Premises and equipment are stated at cost less accumulated depreciation. Depreciation is charged to operations on a straight-line basis over the estimated useful lives of the respective assets. Leasehold improvements are amortized over the shorter of their estimated life or the lease term. |
Advertising | Advertising The Company expenses advertising costs as incurred. |
Income Taxes | Income Taxes The Tax Cuts and Jobs Act (the "Tax Act") was signed into law on December 22, 2017. As a result of the Tax Act, the Company recorded a non-cash charge to income tax expense of approximately $1.8 million in the fourth quarter of 2017 due to the re-measurement of deferred tax assets and liabilities resulting from the reduction in the Federal corporate income tax rate from 34% to 21%, effective January 1, 2018. Deferred income taxes are provided on the liability method whereby deferred tax assets are recognized for deductible temporary differences and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax basis. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The Company and its subsidiary file a consolidated Federal income tax return. The Company analyzes each tax position taken in its tax returns and those positions not taken and determines the likelihood that the position will be realized. Only tax positions that are “more likely than not” to be realized can be recognized in the Company’s financial statements. For tax positions that do not meet this recognition threshold, the Company will record an unrecognized tax benefit for the difference between the position taken on the tax return and the amount recognized in the financial statements. The Company does not have any material unrecognized tax benefits or accrued interest or penalties at December 31, 2018 or 2017 or during the years then ended. No unrecognized tax benefits are expected to arise within the next twelve months. The Company’s policy is to account for interest as a component of interest expense and penalties as a component of other expenses. |
Off-Balance-Sheet Financial Instruments | Off-Balance Sheet Financial Instruments In the ordinary course of business, the Company has entered into off-balance sheet financial instruments consisting of commitments to extend credit and letters of credit. Such financial instruments are recorded in the balance sheet when they are funded. |
Earnings per Common Share | Earnings per Common Share On January 19, 2017, the Company declared a 5% stock dividend on common stock outstanding payable February 28, 2017 to shareholders of record as of February 9, 2017. All share and per share information in the financial statements have been adjusted retroactively for the effect of the stock dividend. Earnings per common share are calculated on the basis of the weighted average number of common shares outstanding during the year. Basic earnings per common share excludes dilution and is calculated by dividing net income available to common shareholders by the weighted average common shares outstanding excluding potential common shares. Diluted earnings per common share takes into account the potential dilution that could occur if potential common shares had been issued relating to outstanding stock options and restricted stock awards. Potential common shares relate to outstanding stock options, warrants and restricted stock awards, and are determined using the treasury stock method. |
Share-Based Compensation | Stock-Based Compensation Stock compensation accounting guidance requires that the compensation cost relating to share-based payment transactions be recognized in financial statements. That cost will be measured based on the grant date fair value of the equity or liability instruments issued. The stock compensation accounting guidance covers a wide range of share-based compensation arrangements including stock options, restricted share plans, performance-based awards, share appreciation rights, and employee share purchase plans. The stock compensation accounting guidance requires that compensation cost for all stock awards be calculated and recognized over the employees’ service periods, generally defined as the vesting period. For awards with graded-vesting, compensation cost is recognized on a straight-line basis over the requisite service period for the entire award. A Black-Scholes model is used to estimate the fair value of stock options, while the market price of the Company’s common stock at the date of grant is used for restricted stock awards. |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets The Company’s goodwill was recognized in connection with the acquisition of the Town Bank in April 2006. Accounting principles generally accepted in the United States of America require that goodwill be tested for impairment annually or more frequently if impairment indicators arise utilizing a two-step methodology. However, a qualitative factor test can be performed to determine whether it is necessary to perform the two-step quantitative impairment test. If this qualitative test determines it is not likely (less than 50% probability) the fair value of the reporting unit is less than book value, then the Company does not have to perform a step one quantitative test and goodwill can be considered not impaired. The Company reviewed the requirements of ASU 350-20 and examples of qualitative assessments to determine whether the weight of evidence indicates greater than 50% likelihood exists that the carrying value of the reporting unit exceeds its fair value. The nine qualitative assessments used are macroeconomic factors, banking industry conditions, banking industry merger and acquisition trends, bank historical performance, parent stock price, expected bank performance, change of control premium (parent), change of control premium (peer), and other factors. |
Segment Reporting | Segment Reporting The Company acts as an independent community financial services provider, and offers traditional banking and related financial services to individual, business and government customers. Through its branch, automated teller machine networks, and internet banking services, the Company offers a full array of commercial and retail financial services, including time, savings and demand deposits; the making of commercial, consumer and mortgage loans; and the providing of other financial services. Management does not separately allocate expenses, including the cost of funding loan demand, between the commercial, retail, mortgage banking and consumer banking operations of the Company. Accordingly, all significant operating decisions are based upon analysis of the Bank as one segment or unit. |
Subsequent Events | Subsequent Events The Company has evaluated events and transactions occurring subsequent to the balance sheet date of December 31, 2018 for items that should potentially be recognized or disclosed in these financial statements. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements ASU 2014-09: In May 2014, the Financial Accounting Standards Board ("FASB") issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) , superseding the revenue recognition requirements in ASC 605. This ASU requires an entity to recognize revenue for the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The amendment includes a five-step process to assist an entity in achieving the main principle(s) of revenue recognition under ASC 605. In March 2016, the FASB also issued ASU 2016-08, an amendment to the guidance in ASU 2014-09, which reframed the structure of the indicators of when an entity is acting as an agent and focused on evidence that an entity is acting as the principal or agent in a revenue transaction. ASU 2016-08 also eliminated two of the indicators (the entity’s consideration is in the form of a commission, and the entity is not exposed to credit risk) in making that determination. This amendment also clarifies that each indicator may be more or less relevant to the assessment depending on the terms and conditions of the contract. In May 2016, the FASB issued ASU 2016-12, an amendment to ASU 2014-09, which provided practical expedients related to disclosures of remaining performance obligations, as well as other amendments to guidance on transition, collectability, non-cash consideration and presentation of sales and other similar taxes. The amendments, collectively, should be applied retrospectively to each prior reporting period presented or as a cumulative effect adjustment as of the date of adoption (modified retrospective approach). Because the ASU does not apply to revenue associated with financial instruments (including loans and securities), the Company concluded that the new guidance did not have a material impact on the elements of its consolidated statements of operations most closely associated with financial instruments (such as interest income, interest expense and securities gains). The Company completed its identification of all revenue streams included in its financial statements and has identified its deposit- related fees, service charges, debit and interchange income to be within the scope of the standard. The Company has also completed its review of the related contracts and its evaluation of certain costs related to these revenue streams to determine whether such costs should be presented as expenses or contra-revenue (i.e., gross vs. net). The Company's overall assessment indicates that adoption of this ASU will not materially change its current method and timing of recognizing revenue for the identified revenue streams. Based on its evaluation, the Company determined that the classification of certain debit card interchange costs should change (i.e. costs previously recorded as expenses are now recorded as contra-revenue). The Company adopted this ASU on January 1, 2018, on a modified retrospective approach. Since there was no net income impact upon adoption of the new guidance, a cumulative effect adjustment to opening retained earnings was not deemed necessary. Consistent with the modified retrospective approach, the Company did not adjust prior period amounts for the debit card interchange costs noted above. See Note 2, Revenue Recognition , for more information. The adoption of this ASU, as discussed above, did not have a significant impact to the Company's financial condition, results of operations and consolidated financial statements. ASU 2016-01: In January 2016, the FASB issued ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities. In February 2018, the FASB issued ASU 2018-03, Technical Corrections and Improvements to Financial Instruments -- Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Liabilities , that clarifies the guidance in ASU 2016-01. ASU 2016-01 requires equity investments to be measured at fair value with changes in fair value recognized in net income; provides for a practicability exception election for equity investments without readily determinable fair values; simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment; eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet; requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; requires an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments; requires separate presentation of financial assets and financial liabilities by measurement category and form of financial assets on the balance sheet or the accompanying notes to the financial statements and clarifies that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets. ASU 2016-01 is effective for financial statements issued for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company completed its evaluation of the provisions of ASU 2016-01 and determined that the CRA Mutual Fund falls under ASU 2016-01. The Company adopted this ASU effective January 1, 2018 and the impact amounted to a cumulative effect adjustment of $39,000 , net of tax, as a reclassification from accumulated other comprehensive loss to retained earnings. Additionally, all future unrealized gains and losses will be recognized in the Statements of Operations. As such, for the twelve months ended December 31, 2018 , an unrealized loss of $53,000 was recorded in Other Income (see Note 3, Securities , for more information). In connection with the adoption of this ASU, the Company elected the practical expedient to fair value measurement for the Solomon Hess SBA Loan Fund, which does not have a readily determinable fair value. Under the practical expedient, the Fund is measured at cost, less impairment, plus or minus observable price changes (in orderly transactions) of identical or similar investment of the same issuer. Additionally, the Company measured the fair value of its loan portfolio as of March 31, 2018 using an exit price notion, as required in ASC 820. The guidance was applied on a prospective approach resulting in prior periods no longer being comparable (see Note 19, Fair Value of Financial Instruments ). ASU 2016-02: In February 2016, the FASB issued ASU No. 2016-02, Leases , which requires lessees to recognize leases on-balance sheet, makes targeted changes to lessor accounting, and disclose key information about leasing arrangements. Topic 842 was subsequently amended by ASU No. 2018-01, Land Easement Practical Expedient for Transition to Topic 842; ASU No. 2018-10, Codification Improvements to Topic 842, Leases; and ASU No. 2018-11, Targeted Improvements. ASC 842 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 31, 2018. A modified retrospective transition approach is required, applying the new standard to all leases existing at the date of initial application. An entity may choose to use either (1) the effective date or (2) the beginning of the earliest comparative period presented in the financial statements as its date of initial application. The Company has elected to use the effective date, January 1, 2019, as the date of initial application. Consequently, financial information will not be updated and the disclosures required under the new standard will not be provided for dates and periods before January 1, 2019. From the lessee's perspective, the new standard establishes a right-of-use ("ROU") model that requires a lessee to recognize a ROU asset and a corresponding lease liability on the balance sheet for all leases with terms longer than 12 months, subject to a policy election. The Company has elected the short-term lease recognition exemption such that the Company will not recognize ROU assets or lease liabilities for leases with a term of less than 12 months from the commencement date. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement for a lessee. Additionally, the ASU expands quantitative and qualitative disclosures to help financial statement users better understand the amount, timing, and uncertainty of cash flows arising from leases. The new leasing standard provides a number of optional practical expedients in transition. The Company has elected the "package of practical expedients," which permits the Company not to reassess prior conclusions about lease identification, lease classification and initial direct costs. The Company does not expect to elect the use-of-hindsight or the practical expedient pertaining to land easements; the latter not being applicable to the Company. ASC 842 also provides certain accounting policy elections for an entity's ongoing accounting. For operating leases wherein the Company is the lessee, the Company has elected the practical expedient to not separate lease and non-lease components. Under legacy lease accounting, all of the Company's leases, which primarily relate to office space and bank branches, were classified as operating leases and, as such, are not recognized on the Company's Consolidated Balance Sheet for periods prior to the adoption of ASC 842. The Company has engaged a third-party vendor and is using their software to assist in calculating the impact of this ASU. The adoption of ASU 2016-02 will result in increases to both the Company's assets and liabilities. The Company anticipates the increase to be less than 1% of total assets as of December 31, 2018 and anticipates a decrease in the Bank's and Company's regulatory capital ratios by approximately three to nine basis points, due to an increase in total assets and risk-weighted assets. ASU 2016-13: In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326) . This ASU requires entities to measure all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Entities will now use forward-looking information to better form their credit loss estimates. The ASU also requires enhanced disclosures to help financial statement users better understand significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of an entity’s portfolio. For public entities that are SEC filers, this ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early application will be permitted for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The Company has formed a CECL committee, which has assessed our data and system needs, and has engaged a third-party vendor to assist in analyzing our data and developing a CECL model. The Company, in conjunction with this vendor, has researched and analyzed modeling standards, loan segmentation, as well as potential external inputs to supplement our historical loss history. We expect to recognize a one-time cumulative effect adjustment to the allowance for loan losses as of the beginning of the first reporting period in which the ASU is effective, but cannot yet determine the magnitude of any such one-time adjustment or the overall impact of the ASU on our consolidated financial statements. ASU 2016-15: In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments . ASU 2016-15 addresses changes to reduce the presentation diversity of certain cash receipts and cash payments in the statement of cash flows, including debt prepayment or extinguishment costs, settlement of certain debt instruments, contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims, and distributions received from equity method investees. The guidance becomes effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years, with early adoption permitted. An entity that elects early adoption must adopt all of the amendments in the same period. The new standard will be applied retrospectively, but may be applied prospectively if retrospective application would be impracticable. The Company adopted this ASU and the impact is not material on the financial statements. ASU 2016-18: In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash. ASU 2016-18 was issued to address divergence in the way restricted cash is classified and presented. The amendments in the update require that a statement of cash flows explain the change during a reporting period in the total of cash, cash equivalents, and amounts generally described as restricted cash and restricted cash equivalents. The amendments in this update apply to entities that have restricted cash or restricted cash equivalents and are required to present a statement of cash flows under Topic 230. The amendment says that transfers between cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents are not part of the entity's operating, investing, and financing activities. For public business entities, ASU 2016-18 is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company adopted this ASU and the impact is not material on the financial statements. ASU 2017-04: In January 2017, the FASB issued ASU 2017-04, Intangibles—Goodwill and Other (Topic 350) . ASU 2017-04 removes Step 2 from the goodwill impairment test. Under the amendments in this update, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. Additionally, an entity should consider income tax effects from any tax deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. The Board also eliminated the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment and, if it fails that qualitative test, to perform Step 2 of the goodwill impairment test. Therefore, the same impairment assessment applies to all reporting units. An entity is required to disclose the amount of goodwill allocated to each reporting unit with a zero or negative carrying amount of net assets. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. For public entities that are SEC filers, this ASU is effective for its annual, or any goodwill impairment tests in fiscal years, beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is currently evaluating the new guidance but has determined that this standard should not have a material impact on its consolidated financial statements. ASU 2017-08: In March 2017, the FASB issued ASU 2017-08, Receivables-Nonrefundable Fees and Other Costs (Subtopic 310-20), Premium Amortization on Purchased Callable Debt Securities. ASU No. 2017-08 shortens the amortization period for certain callable debt securities held at a premium. Specifically, the amendments require the premium to be amortized to the earliest call date. The amendments do not require an accounting change for securities held at a discount; the discount continues to be amortized to maturity. ASU 2017-08 will be effective for public business entities for fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020. We are currently evaluating this ASU to determine the impact on our consolidated financial statements. ASU 2017-09: In May 2017, the FASB issued ASU No. 2017-09, Stock Compensation, Scope of Modification Accounting. This ASU clarifies when changes to the terms of conditions of a share-based payment award must be accounted for as modifications. Companies will apply the modification accounting guidance if the value, vesting conditions or classification of the award changes. The new guidance should reduce diversity in practice and result in fewer changes to the terms of an award being accounted for as modifications, as the guidance will allow companies to make certain non-substantive changes to awards without accounting for them as modifications. It does not change the accounting for modifications. ASU No. 2017-09 is effective for interim and annual reporting periods beginning after December 15, 2017; early adoption is permitted. The Company adopted this ASU and the impact is not material on the financial statements. ASU 2018-02: In February 2018, the FASB issued ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220) - Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. This ASU was issued to address a narrow-scope financial reporting issue that arose as a result of the enactment of the Tax Cuts and Jobs Act (“Tax Reform”) on December 22, 2017. The objective of ASU 2018-02 is to address the tax effects of items within accumulated other comprehensive income (referred to as “stranded tax effects”) that do not reflect the appropriate tax rate enacted in the Tax Reform. As a result, the ASU 2018-02 allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the newly enacted federal corporate income tax rate. The amount of the reclassification would be the difference between the historical corporate income tax rate of 34 percent and the newly enacted corporate income tax rate of 21 percent. ASU 2018-02 is effective for fiscal years beginning after December 15, 2018, with early adoption permitted, including adoption in an interim period. The amendments in this ASU may be applied retrospectively to each period in which the effect of the change in the U.S. Federal corporate income tax rate in the Tax Reform is recognized. The Company adopted ASU 2018-02 effective January 1, 2018, and the impact amounted to $59,000 as a reclassification from accumulated other comprehensive loss to retained earnings. ASU 2018-13: In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement . ASU 2018-13 includes certain removals, modifications and additions to the disclosure requirements on fair value measurements in Topic 820. The updated guidance is effective for fiscal years and interim periods beginning after December 15, 2019. Early adoption is permitted. The Company is permitted to early adopt any removed or modified disclosures upon issuance of ASU 2018-13 and delay adoption of the additional disclosures until their effective date. The impact on the consolidated financial statements of the Company will depend on the facts and circumstances of any specific future transactions. The Company has elected not to early adopt the additional disclosures required by the ASU until their effective date. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following presents non-interest income, segregated by revenue streams in-scope and out-of-scope of Topic 606, for the years ended December 31, 2018 and 2017 . Twelve Months Ended December 31, 2018 2017 2016 (Dollars in Thousands) Non-Interest Income In-scope of Topic 606 Service fees on deposit accounts $ 880 $ 772 $ 587 Other income 549 746 693 Non-Interest Income (in-scope of Topic 606) 1,429 1,518 1,280 Non-Interest Income (out-of-scope of Topic 606) 4,102 3,941 4,209 Total Non-Interest Income $ 5,531 $ 5,459 $ 5,489 |
Securities (Tables)
Securities (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Amortized cost, gross unrealized gains and losses, and fair values of securities | The amortized cost, gross unrealized gains and losses, and fair values of the Company’s securities are summarized as follows: December 31, 2018 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value (In Thousands) Securities available for sale: U.S. Government agency securities $ 11,800 $ 5 $ (170 ) $ 11,635 Municipal securities 487 — — 487 U.S. Government-sponsored enterprises (“GSE”) – residential mortgage-backed securities 6,131 1 (185 ) 5,947 U.S. Government collateralized residential mortgage obligations 4,600 1 (178 ) 4,423 Corporate debt securities, primarily financial institutions 1,999 3 (87 ) 1,915 Total securities available for sale $ 25,017 $ 10 $ (620 ) $ 24,407 Total equity securities $ 2,559 $ — $ (108 ) $ 2,451 Securities held to maturity: Municipal securities $ 36,436 $ 389 $ (111 ) $ 36,714 GSE – residential mortgage-backed securities 7,423 — (211 ) 7,212 U.S. Government collateralized residential mortgage obligations 1,769 — (57 ) 1,712 Corporate debt securities, primarily financial institutions 1,827 — (199 ) 1,628 Total securities held to maturity $ 47,455 $ 389 $ (578 ) $ 47,266 December 31, 2017 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value (In Thousands) Securities available for sale: U.S. Government agency securities $ 10,105 $ — $ (48 ) $ 10,057 Municipal securities 494 1 — 495 GSE – residential mortgage-backed securities 8,362 — (143 ) 8,219 U.S. Government collateralized residential mortgage obligations 7,672 1 (191 ) 7,482 Corporate debt securities, primarily financial institutions 2,494 9 (72 ) 2,431 Total securities available for sale $ 29,127 $ 11 $ (454 ) $ 28,684 Total equity securities $ 2,503 $ — $ (55 ) $ 2,448 Securities held to maturity: Municipal securities $ 46,614 $ 812 $ (20 ) $ 47,406 GSE – residential mortgage-backed securities 7,339 — (98 ) 7,241 U.S. Government collateralized residential mortgage obligations 2,224 — (46 ) 2,178 Corporate debt securities, primarily financial institutions 1,825 — (101 ) 1,724 Total securities held to maturity $ 58,002 $ 812 $ (265 ) $ 58,549 |
Amortized cost and fair value of debt securities | The amortized cost and fair value of the Company’s debt securities at December 31, 2018 , by contractual maturity, are shown below. 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. Available for Sale Held to Maturity Amortized Cost Fair Value Amortized Cost Fair Value (In Thousands) Due in one year or less $ 1,254 $ 1,245 $ 5,415 $ 5,423 Due in one year through five years 7,548 7,505 1,290 1,314 Due in five years through ten years 1,354 1,321 8,071 7,993 Due after ten years 4,130 3,966 23,487 23,612 Sub-total 14,286 14,037 38,263 38,342 GSE – residential mortgage-backed securities 6,131 5,947 7,423 7,212 U.S. Government collateralized residential mortgage obligations 4,600 4,423 1,769 1,712 Total $ 25,017 $ 24,407 $ 47,455 $ 47,266 |
Length of time individual securities have been in continuous unrealized loss position | The tables below indicate the length of time individual securities have been in a continuous unrealized loss position at December 31, 2018 and 2017 : Less than 12 Months 12 Months or More Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses December 31, 2018 (In Thousands) U.S. Government agency securities $ 4,842 $ (72 ) $ 5,470 $ (98 ) $ 10,312 $ (170 ) Municipal securities 5,227 (24 ) 8,378 (87 ) 13,605 (111 ) GSE – residential mortgage-backed securities 1,330 (10 ) 11,675 (386 ) 13,005 (396 ) U.S. Government collateralized residential mortgage obligations 146 — 5,938 (235 ) 6,084 (235 ) Corporate debt securities, primarily financial institutions 493 (8 ) 2,548 (278 ) 3,041 (286 ) Total temporarily impaired securities $ 12,038 $ (114 ) $ 34,009 $ (1,084 ) $ 46,047 $ (1,198 ) Less than 12 Months 12 Months or More Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses December 31, 2017 (In Thousands) U.S. Government agency securities $ 8,229 $ (46 ) $ 1,766 $ (2 ) $ 9,995 $ (48 ) Municipal securities 14,170 (20 ) — — 14,170 (20 ) GSE – residential mortgage-backed securities 6,302 (66 ) 9,123 (175 ) 15,425 (241 ) U.S. Government collateralized residential mortgage obligations 1,806 (20 ) 7,500 (217 ) 9,306 (237 ) Corporate debt securities, primarily financial institutions — — 2,648 (173 ) 2,648 (173 ) Equity securities — — 2,449 (55 ) 2,449 (55 ) Total temporarily impaired securities $ 30,507 $ (152 ) $ 23,486 $ (622 ) $ 53,993 $ (774 ) |
Loans Receivable and Allowanc_2
Loans Receivable and Allowance for Loan Losses (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Receivables [Abstract] | |
Components of Loan Portfolio | The components of the loan portfolio at December 31, 2018 and 2017 are as follows: 2018 2017 (In Thousands) Commercial and industrial $ 109,362 $ 101,371 Real estate – construction 144,865 118,094 Real estate – commercial 552,549 537,733 Real estate – residential 84,123 64,238 Consumer 31,144 30,203 922,043 851,639 Allowance for loan losses (11,398 ) (10,668 ) Net unearned fees (742 ) (765 ) Net Loans $ 909,903 $ 840,206 |
Loans Summarized by Past Due Status | The following table presents the classes of the loan portfolio summarized by the past due status as of December 31, 2018 and 2017 : December 31, 2018 (In Thousands) 30-59 Days Past Due 60-89 Days Past Due Greater than 90 Days Total Past Due Current Total Loans Receivable Loans Receivable>90 Days and Accruing Commercial and industrial $ 100 $ — $ 765 $ 865 $ 108,497 $ 109,362 $ — Real estate – construction 3,575 — 150 3,725 141,140 144,865 — Real estate – commercial 563 — 54 617 551,932 552,549 — Real estate – residential — 564 227 791 83,332 84,123 — Consumer — — 194 194 30,950 31,144 — Total $ 4,238 $ 564 $ 1,390 $ 6,192 $ 915,851 $ 922,043 $ — December 31, 2017 (In Thousands) 30-59 Days Past Due 60-89 Days Past Due Greater than 90 Days Total Past Due Current Total Loans Receivable Loans Receivable>90 Days and Accruing Commercial and industrial $ 224 $ — $ 790 $ 1,014 $ 100,357 $ 101,371 $ — Real estate – construction — — 150 150 117,944 118,094 — Real estate – commercial 146 150 219 515 537,218 537,733 — Real estate – residential 290 — 717 1,007 63,231 64,238 — Consumer 92 — 194 286 29,917 30,203 — Total $ 752 $ 150 $ 2,070 $ 2,972 $ 848,667 $ 851,639 $ — |
Non-Accrual Loans by Classes | The following table presents non-accrual loans by classes of the loan portfolio at December 31, 2018 and 2017 : 2018 2017 (In Thousands) Commercial and industrial $ 765 $ 790 Real estate – construction 150 150 Real estate – commercial 54 219 Real estate – residential 227 717 Consumer 194 194 Total $ 1,390 $ 2,070 |
Impaired Loans by Loan Portfolio Class | The following table summarizes information in regards to impaired loans by loan portfolio class as of and for the years ended December 31, 2018 , 2017 and 2016 : December 31, 2018 Recorded Investment, Net of Charge-offs Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized (In Thousands) With no related allowance recorded: Commercial and industrial $ 4,200 $ 4,200 $ — $ 3,201 $ 131 Real estate – construction 3,082 3,082 — 3,116 134 Real estate – commercial 168 168 — 174 6 Real estate – residential 589 589 — 593 18 Consumer 194 194 — 194 — With an allowance recorded: Commercial and industrial $ — $ — $ — $ — $ — Real estate – construction — — — — — Real estate – commercial — — — — — Real estate – residential — — — — — Consumer — — — — — Total: Commercial and industrial $ 4,200 $ 4,200 $ — $ 3,201 $ 131 Real estate – construction 3,082 3,082 — 3,116 134 Real estate – commercial 168 168 — 174 6 Real estate – residential 589 589 — 593 18 Consumer 194 194 — 194 — Total $ 8,233 $ 8,233 $ — $ 7,278 $ 289 December 31, 2017 Recorded Investment, Net of Charge-offs Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized (In Thousands) With no related allowance recorded: Commercial and industrial $ 3,350 $ 3,697 $ — $ 3,758 $ 152 Real estate – construction 3,148 3,148 — 3,163 133 Real estate – commercial 344 344 — 411 6 Real estate – residential 1,086 1,086 — 1,105 18 Consumer 194 194 — 194 1 With an allowance recorded: Commercial and industrial $ — $ — $ — $ — $ — Real estate – construction — — — — — Real estate – commercial — — — — — Real estate – residential — — — — — Consumer — — — — — Total: Commercial and industrial $ 3,350 $ 3,697 $ — $ 3,758 $ 152 Real estate – construction 3,148 3,148 — 3,163 133 Real estate – commercial 344 344 — 411 6 Real estate – residential 1,086 1,086 — 1,105 18 Consumer 194 194 — 194 1 Total $ 8,122 $ 8,469 $ — $ 8,631 $ 310 December 31, 2016 Recorded Unpaid Related Average Interest (In Thousands) With no related allowance recorded: Commercial and industrial $ 3,402 $ 3,415 $ — $ 3,575 $ 174 Real estate – construction 3,036 3,036 — 3,073 129 Real estate – commercial 1,548 1,577 — 1,618 47 Real estate – residential 1,139 1,189 — 1,164 18 Consumer — — — — — With an allowance recorded: Commercial and industrial $ 498 $ 498 $ 2 $ 507 $ 15 Real estate – construction — — — — — Real estate – commercial — — — — — Real estate – residential — — — — — Consumer — — — — — Total: Commercial and industrial $ 3,900 $ 3,913 $ 2 $ 4,082 $ 189 Real estate – construction 3,036 3,036 3,073 129 Real estate – commercial 1,548 1,577 1,618 47 Real estate – residential 1,139 1,189 1,164 18 Consumer — — — — Total $ 9,623 $ 9,715 $ 2 $ 9,937 $ 383 |
Financing Receivable Credit Quality Indicators | The following table presents the classes of the loan portfolio summarized by the aggregate pass rating and the classified ratings of special mention, substandard and doubtful within the Company’s internal risk rating system as of December 31, 2018 and 2017 : Pass Special Mention Substandard Doubtful Total (In Thousands) December 31, 2018 Commercial and industrial $ 104,557 $ 126 $ 4,679 $ — $ 109,362 Real estate – construction 138,858 1,577 4,430 — 144,865 Real estate – commercial 549,083 2,722 744 — 552,549 Real estate – residential 83,896 — 227 — 84,123 Consumer 30,782 — 362 — 31,144 Total $ 907,176 $ 4,425 $ 10,442 $ — $ 922,043 Pass Special Mention Substandard Doubtful Total (In Thousands) December 31, 2017 Commercial and industrial $ 97,160 $ 796 $ 3,299 $ 116 $ 101,371 Real estate – construction 112,353 4,252 1,489 — 118,094 Real estate – commercial 525,951 5,681 6,101 — 537,733 Real estate – residential 63,521 — 717 — 64,238 Consumer 29,795 34 374 — 30,203 Total $ 828,780 $ 10,763 $ 11,980 $ 116 $ 851,639 |
Allowance for Loan Losses by Classes | The following table presents the balance in the allowance for loan losses at December 31, 2018 and 2017 disaggregated on the basis of the Company’s impairment method by class of loans receivable along with the balance of loans receivable by class disaggregated on the basis of the Company’s impairment methodology: Allowance for Loan Losses Loans Receivable December 31, 2018 Balance Balance Related to Loans Individually Evaluated for Impairment Balance Related to Loans Collectively Evaluated for Impairment Balance Balance Individually Evaluated for Impairment Balance Collectively Evaluated for Impairment (In Thousands) Commercial and industrial $ 745 $ — $ 745 $ 109,362 $ 4,200 $ 105,162 Real estate – construction 2,049 — 2,049 144,865 3,082 141,783 Real estate – commercial 7,283 — 7,283 552,549 168 552,381 Real estate – residential 668 — 668 84,123 589 83,534 Consumer 147 — 147 31,144 194 30,950 Unallocated 506 — 506 — — — Total $ 11,398 $ — $ 11,398 $ 922,043 $ 8,233 $ 913,810 Allowance for Loan Losses Loans Receivable December 31, 2017 Balance Balance Related to Loans Individually Evaluated for Impairment Balance Related to Loans Collectively Evaluated for Impairment Balance Balance Individually Evaluated for Impairment Balance Collectively Evaluated for Impairment (In Thousands) Commercial and industrial $ 930 $ — $ 930 $ 101,371 $ 3,350 $ 98,021 Real estate – construction 1,389 — 1,389 118,094 3,148 114,946 Real estate – commercial 7,325 — 7,325 537,733 344 537,389 Real estate – residential 502 — 502 64,238 1,086 63,152 Consumer 174 — 174 30,203 194 30,009 Unallocated 348 — 348 — — — Total $ 10,668 $ — $ 10,668 $ 851,639 $ 8,122 $ 843,517 The following table presents the change in the allowance for loan losses by classes of loans as of December 31, 2018 , 2017 and 2016 : Allowance for Loan Losses Commercial and Industrial Real Estate - Construction Real Estate - Commercial Real Estate – Residential Consumer Unallocated Total (In Thousands) Beginning balance, January 1, 2018 $ 930 $ 1,389 $ 7,325 $ 502 $ 174 $ 348 $ 10,668 Charge-offs (116 ) — (12 ) — — — (128 ) Recoveries 33 3 26 — 21 — 83 Provision (102 ) 657 (56 ) 166 (48 ) 158 775 Ending balance, December 31, 2018 $ 745 $ 2,049 $ 7,283 $ 668 $ 147 $ 506 $ 11,398 Allowance for Loan Losses Commercial and Industrial Real Estate - Construction Real Estate - Commercial Real Estate - Residential Consumer Unallocated Total (In Thousands) Beginning balance, January 1, 2017 $ 844 $ 1,276 $ 6,315 $ 463 $ 244 $ 423 $ 9,565 Charge-offs (381 ) — — — (106 ) — (487 ) Recoveries 18 12 24 — 6 — 60 Provision 449 101 986 39 30 (75 ) 1,530 Ending balance, December 31, 2017 $ 930 $ 1,389 $ 7,325 $ 502 $ 174 $ 348 $ 10,668 Allowance for Loan Losses Commercial Real Estate - Real Estate - Real Estate - Consumer Unallocated Total (In Thousands) Beginning balance, January 1, 2016 $ 990 $ 1,283 $ 5,599 $ 304 $ 242 $ 295 $ 8,713 Charge-offs — — (444 ) — (5 ) — (449 ) Recoveries 12 12 696 — 66 — 786 Provision (158 ) (19 ) 464 159 (59 ) 128 515 Ending balance, December 31, 2016 $ 844 $ 1,276 $ 6,315 $ 463 $ 244 $ 423 $ 9,565 |
Troubled Debt Restructured Loans | The following tables present newly troubled debt restructured loans that occurred during the years ended December 31, 2018 and 2017: Year Ended December 31, 2018 Number of Contracts Pre-Modification Outstanding Recorded Investment Post-Modification Outstanding Recorded Investment (Dollars in Thousands) Troubled Debt Restructuring: Commercial and industrial 2 $ 2,738 $ 2,738 Year Ended December 31, 2017 Number of Pre-Modification Post-Modification (Dollars in Thousands) Troubled Debt Restructuring: Commercial and Industrial 3 $ 320 $ 320 Real Estate - Construction 1 150 150 4 $ 470 $ 470 |
Premises and Equipment (Tables)
Premises and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Premises and Equipment | Premises and equipment at December 31, 2018 and 2017 are as follows: Estimated Useful Lives (years) 2018 2017 (In Thousands) Land Indefinite $ 1,487 $ 1,487 Buildings 30 2,114 2,120 Leasehold improvements 5 — 15 3,342 3,432 Furniture and equipment 2 — 7 9,033 8,915 Construction in progress 1,267 1,136 Total premises and equipment 17,243 17,090 Less accumulated depreciation and amortization (11,326 ) (10,851 ) Total premises and equipment, net $ 5,917 $ 6,239 |
Deposits (Tables)
Deposits (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Deposits [Abstract] | |
Deposits Components | The components of deposits at December 31, 2018 and 2017 are as follows: 2018 2017 (In Thousands) Demand, non-interest bearing $ 176,655 $ 167,297 Demand, interest-bearing, money market and savings 495,949 534,939 Time, $250,000 and over 38,512 14,853 Time, other 206,238 144,468 Total deposits $ 917,354 $ 861,557 |
Deposits Schedule of Maturities | At December 31, 2018 , the scheduled maturities of time deposits are as follows (in thousands): 2019 $ 107,854 2020 76,664 2021 21,678 2022 23,453 2023 15,101 Total time deposits $ 244,750 |
Securities Sold Under Agreeme_2
Securities Sold Under Agreements to Repurchase (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Repurchase Agreements [Abstract] | |
Schedule of Repurchase Agreements | Information concerning repurchase agreements for the three years ended December 31, 2018 is as follows: 2018 2017 2016 (Dollars In Thousands) Repurchase agreements: Balance at year-end $ 19,402 $ 27,120 $ 19,915 Average during the year $ 19,738 $ 22,066 $ 19,309 Maximum month-end balance $ 23,884 $ 27,120 $ 22,105 Weighted average rate during the year 0.29 % 0.30 % 0.32 % Weighted average rate at December 31 0.24 % 0.25 % 0.24 % |
Schedule of Repurchase Agreements Maturities | The following table presents the contractual maturities of the Repurchase Agreements as of December 31, 2018 and 2017 , disaggregated by the class of collateral pledged: Maturity of Repurchase Agreements (dollars in thousands) Overnight and Continuous Up to 30 days 30 to 90 days Over 90 days Total December 31, 2018 Class of Collateral Pledged: U.S. Government agency securities $ 11,566 $ — $ — $ — $ 11,566 GSE – Residential mortgage-backed securities 4,289 — — — 4,289 U.S. Government collateralized residential mortgage obligations 10,334 — — — 10,334 Total $ 26,189 $ — $ — $ — $ 26,189 Gross amount of recognized liabilities for repurchase agreements and securities lending $ 19,402 Excess of collateral pledged over recognized liability $ 6,787 Maturity of Repurchase Agreements (dollars in thousands) Overnight Up to 30 to 90 Over 90 Total December 31, 2017 Class of Collateral Pledged: U.S. Government agency securities $ 9,995 $ — $ — $ — $ 9,995 GSE – Residential mortgage-backed securities 5,558 — — — 5,558 U.S. Government collateralized residential mortgage obligations 13,440 — — — 13,440 Total $ 28,993 $ — $ — $ — $ 28,993 Gross amount of recognized liabilities for repurchase agreements and securities lending $ 27,120 Excess of collateral pledged over recognized liability $ 1,873 |
FHLB and Other Borrowings (Tabl
FHLB and Other Borrowings (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Repayment for Advances from FHLB | These advances are contractually scheduled for repayment as follows (dollars in thousands): 2018 2017 Rate Original Term (years) Maturity Fixed Rate Note — 2,000 1.65 % 5 October 2018 Fixed Rate Note — 1,300 1.31 % 3 January 2018 Fixed Rate Note 1,800 1,800 1.59 % 4 January 2019 Fixed Rate Note 2,700 2,700 1.81 % 5 January 2020 Fixed Rate Note 2,500 2,500 2.03 % 6 January 2021 Fixed Rate Note 1,000 1,000 1.09 % 3 July 2019 Fixed Rate Note 1,000 1,000 1.42 % 5 July 2021 Fixed Rate Note 1,000 1,000 1.70 % 7 July 2023 Fixed Rate Note 7,500 7,500 2.07 % 5 August 2022 Fixed Rate Note 5,000 5,000 2.16 % 4 October 2021 Total FHLB borrowings $ 22,500 $ 25,800 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense | The components of income tax expense for the years ended December 31, 2018 , 2017 and 2016 are as follows: 2018 2017 2016 (In Thousands) Current $ 4,419 $ 4,957 $ 4,791 Deferred (429 ) 1,061 (463 ) Income tax expense $ 3,990 $ 6,018 $ 4,328 |
Schedule of Effective Income Tax Rate Reconciliation | A reconciliation of the statutory Federal income tax at a rate of 21% for 2018 and 34% for 2017 and 2016 to the income tax expense included in the statements of operations is as follows: 2018 2017 2016 Amount % Amount % Amount % (Dollars In Thousands) Federal income tax expense at statutory rate $ 3,191 21.0 % $ 4,257 34.0 % $ 4,406 34.0 % Increases (decreases) resulting from: Tax exempt interest (233 ) (1.5 ) (358 ) (2.9 ) (334 ) (2.6 ) Bank owned life insurance income (110 ) (0.7 ) (185 ) (1.5 ) (455 ) (3.5 ) State income taxes, net of federal income tax benefit 1,366 9.0 734 5.9 712 5.5 Reduction in Federal tax rate — — 1,778 14.3 — — Stock-based compensation (216 ) (1.4 ) (191 ) (1.5 ) — — Other, net (8 ) (0.1 ) (17 ) (0.2 ) (1 ) — Income tax expense $ 3,990 26.3 % $ 6,018 48.1 % $ 4,328 33.4 % |
Schedule of Deferred Tax Assets | The components of the net deferred tax asset, included in other assets on the Consolidated Balance Sheets, as of December 31, 2018 and 2017 , were as follows: 2018 2017 (In Thousands) Deferred tax assets: Allowance for loan losses $ 3,219 $ 3,012 Depreciation and amortization 288 415 Deferred compensation 1,299 1,063 Unrealized loss on securities available for sale 165 194 Other 2 35 Total deferred tax assets 4,973 4,719 Deferred tax liabilities: Deferred loan origination costs (384 ) (366 ) Total deferred tax liabilities (384 ) (366 ) Net Deferred Tax Asset $ 4,589 $ 4,353 |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following sets forth the computation of basic and diluted earnings per common share for the three years ended December 31, 2018 : Years Ended December 31, 2018 2017 2016 (In Thousands, Except Per Share Data) Net income $ 11,206 $ 6,502 $ 8,631 Preferred stock dividend — — — Income applicable to common shareholders $ 11,206 $ 6,502 $ 8,631 Weighted average common shares outstanding 8,508 8,388 8,321 Effect of dilutive securities, stock options and restricted stock 194 270 209 Weighted average common shares outstanding used to calculate diluted earnings per share 8,702 8,658 8,530 Basic earnings per common share $ 1.32 $ 0.78 $ 1.04 Diluted earnings per common share $ 1.29 $ 0.75 $ 1.01 |
Lease Commitments and Total R_2
Lease Commitments and Total Rental Expense (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Leases, Operating [Abstract] | |
Schedule of Rent Commitments | The approximate future minimum rental commitments under operating leases at December 31, 2018 are as follows (in thousands): 2019 $ 1,481 2020 1,384 2021 1,420 2022 1,465 2023 1,490 Thereafter 8,508 Total $ 15,748 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Disclosure of Outstanding Options | The following table presents information regarding the Company’s outstanding options: Number of Shares Weighted Average Price Weighted Average Remaining Contractual Life (years) Aggregate Intrinsic Value Options outstanding, December 31, 2017 361,507 $ 5.20 Options exercised (115,824 ) 3.65 Options forfeited (3,150 ) 8.83 Options outstanding, December 31, 2018 242,533 $ 5.89 3.74 $ 2,269,959 Options exercisable, December 31, 2018 221,231 $ 5.59 3.45 $ 2,138,979 Options price range at December 31, 2018 $ 2.87 to $ 11.21 |
Schedule of Stock Options Outstanding | The following summarizes information about stock options outstanding at December 31, 2018 : Options Outstanding Range of Exercise Prices Number Outstanding at Weighted-Average Remaining Contractual Life (years) Weighted- Average Exercise Price $ 2.87 — $ 3.65 51,862 0.6 $ 3.10 $ 4.94 — $ 5.23 94,320 3.27 5.03 $ 7.06 — $ 8.00 62,625 5.39 7.53 $ 8.59 — $ 11.21 33,726 7.25 9.51 Total options outstanding 242,533 |
Schedule of Restricted Stock | The following table summarizes information about restricted stock for the year ended December 31, 2018 : Number of Shares Weighted Average Price Unvested at December 31, 2017 49,021 $ 14.01 Restricted stock earned (14,931 ) 12.93 Granted 34,450 16.78 Forfeited (500 ) 18.32 Unvested at December 31, 2018 68,040 $ 15.61 |
Schedule of Estimated Fair Value Inputs | The following assumptions were used to estimate the fair value of the stock options granted on October 11, 2016: Dividend yield 1.33 % Expected volatility 27.67 % Risk-free interest rate 1.54 % Expected life (in years) 7.5 Weighted average fair value of options granted $ 3.05 |
Regulatory Matters (Tables)
Regulatory Matters (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Banking and Thrift [Abstract] | |
Schedule of Capital Ratios | The capital ratios of the Company and the Bank, at December 31, 2018 and 2017 , are presented below. Actual For Capital Adequacy Purposes To be Well Capitalized under Prompt Corrective Action Regulations* Amount Ratio Amount Ratio Amount Ratio (Dollars in Thousands) As of December 31, 2018 Common Equity Tier 1 Capital (to risk weighted assets) Two River Bancorp $ 98,758 10.14 % $ > 43,808 > 4.50% N/A N/A Two River Community Bank 107,891 11.09 % > 43,782 > 4.50% $ >63,240 > 6.50% Total Capital (to risk weighted assets) Two River Bancorp 120,156 12.34 % > 77,882 > 8.00% N/A N/A Two River Community Bank 119,289 12.26 % > 77,834 > 8.00% > 97,293 > 10.00% Tier 1 Capital (to risk weighted assets) Two River Bancorp 98,758 10.14 % > 58,411 > 6.00% > 58,411 > 6.00% Two River Community Bank 107,891 11.09 % > 58,376 > 6.00% > 77,834 > 8.00% Tier 1 Capital (to average assets) Two River Bancorp 98,758 9.10 % > 43,389 > 4.00% N/A N/A Two River Community Bank 107,891 9.95 % > 43,363 > 4.00% > 54,204 > 5.00% As of December 31, 2017 Common Equity Tier 1 Capital (to risk weighted assets) Two River Bancorp $ 88,733 9.68 % $ > 41,250 > 4.50% N/A N/A Two River Community Bank 97,723 10.66 % > 41,253 > 4.50% $ > 59,587 > 6.50% Total Capital (to risk weighted assets) Two River Bancorp 109,401 11.93 % > 73,362 > 8.00% N/A N/A Two River Community Bank 108,391 11.82 % > 73,361 > 8.00% > 91,701 > 10.00% Tier 1 Capital (to risk weighted assets) Two River Bancorp 88,733 9.68 % > 55,000 > 6.00% > 55,000 > 6.00% Two River Community Bank 97,723 10.66 % > 55,004 > 6.00% > 73,338 > 8.00% Tier 1 Capital (to average assets) Two River Bancorp 88,733 8.85 % > 40,105 > 4.00% N/A N/A Two River Community Bank 97,723 9.76 % > 40,050 > 4.00% > 50,063 > 5.00% *Applies to the Bank only. For the Company to be “well-capitalized”, the Tier 1 Capital to Risk Weighted Assets has to be at least 6.00% . |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | For financial assets measured at fair value on a recurring basis, the fair value measurements by level within the fair value hierarchy used at December 31, 2018 and 2017 are as follows: Description (Level 1) Quoted Prices in Active Markets for Identical Assets (Level 2) Significant Other Observable Inputs (Level 3) Significant Unobservable Inputs Total (In Thousands) At December 31, 2018 Securities available for sale: U.S. Government agency securities $ — $ 11,635 $ — $ 11,635 Municipal securities — 487 — 487 GSE – Residential mortgage-backed securities — 5,947 — 5,947 U.S. Government collateralized residential mortgage obligations — 4,423 — 4,423 Corporate debt securities, primarily financial institutions — 1,915 — 1,915 Total securities available for sale $ — $ 24,407 $ — $ 24,407 Total Equity Securities $ 2,451 $ — $ — $ 2,451 At December 31, 2017 Securities available for sale: U.S. Government agency securities $ — $ 10,057 $ — $ 10,057 Municipal securities — 495 — 495 GSE – Residential mortgage-backed securities — 8,219 — 8,219 U.S. Government collateralized residential mortgage obligations — 7,482 — 7,482 Corporate debt securities, primarily financial institutions — 2,431 — 2,431 Total securities available for sale $ — $ 28,684 $ — $ 28,684 Total Equity Securities $ 2,448 $ — $ — $ 2,448 |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis | For assets measured at fair value on a nonrecurring basis, the fair value measurements by level within the fair value hierarchy used at December 31, 2018 and 2017 are as follows: Description (Level 1) Quoted Prices in Active Markets for Identical Assets (Level 2) Significant Other Observable Inputs (Level 3) Significant Unobservable Inputs Total (In Thousands) At December 31, 2018 OREO $ — $ — $ 585 $ 585 At December 31, 2017 Impaired loans, net of allowance recorded $ — $ — $ 116 $ 116 |
Fair Value, by Balance Sheet Grouping | The estimated fair values of the Company’s financial instruments at December 31, 2018 and 2017 were as follows: Fair Value Measurements at December 31, 2018 (in thousands) Carrying Amount Estimated Fair Value (Level 1) Quoted Prices in Active Markets for Identical Assets (Level 2) Significant Other Observable Inputs (Level 3) Significant Unobservable Inputs Financial assets: Cash and cash equivalents $ 48,126 $ 48,126 $ 48,126 $ — $ — Securities available for sale 24,407 24,407 — 24,407 — Securities held to maturity 47,455 47,266 — 47,266 — Equity securities 2,451 2,451 2,451 — — Restricted investments 6,082 6,082 — — 6,082 Loans held for sale 1,496 1,525 — — 1,525 Loans receivable, net 909,903 887,374 — — 887,374 Accrued interest receivable 2,583 2,583 — 643 1,940 Financial liabilities: Deposits 917,354 915,435 — 915,435 — Securities sold under agreements to repurchase 19,402 19,402 — 19,402 — FHLB and other borrowings 22,500 21,966 — 21,966 — Subordinated debt 9,923 9,999 — 9,999 — Accrued interest payable 119 119 — 119 — Fair Value Measurements at December 31, 2017 (in thousands) Carrying Amount Estimated Fair Value (Level 1) Quoted Prices in Active Markets for Identical Assets (Level 2) Significant Other Observable Inputs (Level 3) Significant Unobservable Inputs Financial assets: Cash and cash equivalents $ 48,219 $ 48,219 $ 48,219 $ — $ — Securities available for sale 28,684 28,684 28,684 — Securities held to maturity 58,002 58,549 — 58,549 — Equity securities 2,448 2,448 2,448 — — Restricted investments 5,430 5,430 — — 5,430 Loans held for sale 2,581 2,738 — — 2,738 Loans receivable, net 840,206 841,477 — — 841,477 Accrued interest receivable 2,554 2,554 — 638 1,916 Financial liabilities: Deposits 861,557 860,129 — 860,129 — Securities sold under agreements to repurchase 27,120 27,120 — 27,120 — FHLB and other borrowings 25,800 25,382 — 25,382 — Subordinated debt 9,888 9,812 — 9,812 — Accrued interest payable 70 70 — 70 — |
Condensed Financial Statement_2
Condensed Financial Statements of Parent Company (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Condensed Balance Sheets | Condensed financial information pertaining to the parent company, Two River Bancorp, is as follows: Condensed Balance Sheets December 31, 2018 2017 (In Thousands) Assets Cash and cash equivalents $ 355 $ 41 Investments in subsidiaries 125,631 115,507 Other assets 591 1,067 Total assets $ 126,577 $ 116,615 Liabilities and Shareholders’ Equity Subordinated debt $ 9,923 $ 9,888 Other liabilities 156 156 Shareholders’ equity 116,498 106,571 Total liabilities and shareholders’ equity $ 126,577 $ 116,615 |
Condensed Statements of Operations and Comprehensive Income | Condensed Statements of Operations and Comprehensive Income December 31, 2018 2017 2016 (In Thousands) Dividends from Bank $ 1,533 $ 1,578 $ 1,636 Interest expense - subordinated debt 660 658 656 Other operating expenses 317 279 233 Income before income taxes 556 641 747 Income tax benefit (406 ) (483 ) (239 ) Income before undistributed income of subsidiaries 962 1,124 986 Equity in undistributed income of subsidiaries 10,244 5,378 7,645 Net income $ 11,206 $ 6,502 $ 8,631 Equity in other comprehensive income (loss) of subsidiaries, net of tax (121 ) 87 8 Total comprehensive income, net of tax $ 11,085 $ 6,589 $ 8,639 |
Condensed Statements Cash Flows | Condensed Statements of Cash Flows December 31, 2018 2017 2016 (In Thousands) Cash flows from operating activities: Net income $ 11,206 $ 6,502 $ 8,631 Adjustments to reconcile net income to net cash provided by operating activities: Equity in undistributed income of subsidiaries, net of dividends received from Bank (10,244 ) (5,378 ) (7,645 ) Amortization of subordinated debt issuance costs 35 33 31 Stock-based compensation expense 317 279 231 Other, net 475 (543 ) (264 ) Net cash provided by operating activities 1,789 893 984 Cash flows from investing activities: Contributions to subsidiary, net — — — Net cash used in investing activities — — — Cash flows from financing activities: Proceeds from exercise of stock options 423 276 104 Tax benefit relating to stock compensation — 59 25 Proceeds from employee stock purchase program 63 67 56 Redemption of preferred stock, Series C — — — Proceeds from subordinated debt placement, net of issuance costs — — — Common stock repurchased (251 ) — (148 ) Cash dividends paid on common stock (1,710 ) (1,415 ) (1,193 ) Dividends paid on preferred stock, Series C — — — Net cash provided by (used in) financing activities (1,475 ) (1,013 ) (1,156 ) Net increase (decrease) in cash and cash equivalents 314 (120 ) (172 ) Cash and Cash Equivalents - Beginning 41 161 333 Cash and Cash Equivalents – Ending $ 355 $ 41 $ 161 |
Summary of Quarterly Results _2
Summary of Quarterly Results (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information | The following summarizes the consolidated results of operations during 2018 and 2017, on a quarterly basis, for Two River Bancorp. Note that certain balances may not cross-foot due to rounding. (in thousands, except per share data): 2018 Fourth Quarter Third Quarter Second Quarter First Quarter Interest income $ 11,776 $ 11,342 $ 10,907 $ 10,467 Interest expense 2,523 2,239 1,937 1,667 Net interest income 9,253 9,103 8,970 8,800 Provision for loan losses — 150 225 400 Net interest income after provision for loan losses 9,253 8,953 8,745 8,400 Non-interest income 1,370 1,355 1,496 1,310 Non-interest expense 6,447 6,461 6,551 6,227 Income before income taxes 4,176 3,847 3,690 3,483 Income taxes 1,130 1,013 1,040 807 Net income $ 3,046 $ 2,834 $ 2,650 $ 2,676 Per common share data: Basic earnings $ 0.36 $ 0.33 $ 0.31 $ 0.32 Diluted earnings $ 0.35 $ 0.33 $ 0.30 $ 0.31 2017 Fourth Quarter Third Quarter Second Quarter First Quarter Interest income $ 10,074 $ 9,824 $ 9,349 $ 8,993 Interest expense 1,545 1,408 1,391 1,363 Net interest income 8,529 8,416 7,958 7,630 Provision for loan losses 675 255 375 225 Net interest income after provision for loan losses 7,854 8,161 7,583 7,405 Non-interest income 1,343 1,453 1,538 1,125 Non-interest expense 5,919 6,175 6,071 5,777 Income before income taxes 3,278 3,439 3,050 2,753 Income taxes 2,943 1,202 922 951 Net income $ 335 $ 2,237 $ 2,128 $ 1,802 Per common share data: Basic earnings $ 0.04 $ 0.27 $ 0.25 $ 0.22 Diluted earnings $ 0.04 $ 0.26 $ 0.25 $ 0.21 |
Revenue Recognition (Details)
Revenue Recognition (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Non-Interest Income (in-scope of Topic 606) | $ 1,429 | $ 1,518 | $ 1,280 | ||||||||
Non-Interest Income (out-of-scope of Topic 606) | 4,102 | 3,941 | 4,209 | ||||||||
Total Non-Interest Income | $ 1,370 | $ 1,355 | $ 1,496 | $ 1,310 | $ 1,343 | $ 1,453 | $ 1,538 | $ 1,125 | 5,531 | 5,459 | 5,489 |
Service fees on Deposit Accounts | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Non-Interest Income (in-scope of Topic 606) | 880 | 772 | 587 | ||||||||
Other income | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Non-Interest Income (in-scope of Topic 606) | $ 549 | $ 746 | $ 693 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) | Dec. 31, 2018USD ($) | Aug. 31, 2017USD ($) | Jan. 19, 2017 | Dec. 31, 2018USD ($) | Dec. 31, 2018USD ($)loan_segmentsegment | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Jan. 01, 2018USD ($) |
Financing Receivable, Impaired [Line Items] | |||||||||
Investment in FHLB common stock | $ 4,507,600 | $ 4,507,600 | $ 4,507,600 | $ 3,856,000 | |||||
Investment in ACBI common stock | 75,000 | 75,000 | 75,000 | 0 | |||||
Investment in Solomon Hess SBA Loan Fund | 1,500,000 | 1,500,000 | 1,500,000 | 1,500,000 | |||||
Transfer of loans held for investment to loans held for sale | 9,830,000 | 8,180,000 | $ 0 | ||||||
Gain on sale of loans transferred from held for investment to held for sale | $ 200,000 | 177,000 | 0 | ||||||
Number of loans receivable portfolio segments | loan_segment | 5 | ||||||||
Loan to value ratio | 75.00% | ||||||||
Loans serviced for others | 41,500,000 | 41,500,000 | $ 41,500,000 | 32,900,000 | |||||
Servicing fees from loans serviced for others | $ 220,000 | $ 172,000 | 100,000 | ||||||
Rate re-adjustment period | 5 years | ||||||||
SBA loans authorized | 5,000,000 | 5,000,000 | $ 5,000,000 | ||||||
Line of credit available to applicants | 350,000 | 350,000 | $ 350,000 | ||||||
Expiration period for lines of credit | 15 years | ||||||||
Provisional income tax expense as result of the Tax Cuts and Job Act | 1,800,000 | ||||||||
Unrecognized tax benefits expected to arise in next twelve months | $ 0 | $ 0 | $ 0 | ||||||
Common stock dividend percentage | 5.00% | 5.00% | |||||||
Increase to net cash used in investing activities due to prior period error correction | $ (57,921,000) | $ (98,295,000) | $ (79,701,000) | ||||||
Goodwill impairment | $ 0 | ||||||||
Number of operating segments | segment | 1 | ||||||||
AOCI reclassification related to Tax Reform | $ 59,000 | ||||||||
Restatement Adjustment | Immaterial Error in SOCF from Origination of SBA Loans Sold | |||||||||
Financing Receivable, Impaired [Line Items] | |||||||||
Increase to net cash used in investing activities due to prior period error correction | $ 6,400,000 | ||||||||
Commercial Portfolio Segment | Minimum | |||||||||
Financing Receivable, Impaired [Line Items] | |||||||||
Secured commercial loans, term | 1 year | ||||||||
Debt amortization schedule | 5 years | ||||||||
Commercial Portfolio Segment | Maximum | |||||||||
Financing Receivable, Impaired [Line Items] | |||||||||
Secured commercial loans, term | 5 years | ||||||||
Debt amortization schedule | 25 years | ||||||||
Retained Earnings | |||||||||
Financing Receivable, Impaired [Line Items] | |||||||||
AOCI reclassification due to adoption of ASU 2016-01 | $ (39,000) | ||||||||
AOCI reclassification related to Tax Reform | $ 59,000 | ||||||||
Accounting Standards Update 2016-01 | Retained Earnings | |||||||||
Financing Receivable, Impaired [Line Items] | |||||||||
AOCI reclassification due to adoption of ASU 2016-01 | $ 39,000 | ||||||||
Accounting Standards Update 2016-02 | |||||||||
Financing Receivable, Impaired [Line Items] | |||||||||
Expected increase right-of-use asset, as percent of assets | 1.00% | 1.00% | 1.00% | ||||||
Expected increase, operating lease, liability, as percent of assets | 1.00% | 1.00% | 1.00% | ||||||
Accounting Standards Update 2016-02 | Minimum | |||||||||
Financing Receivable, Impaired [Line Items] | |||||||||
Expected decrease to regulatory capital ratios | 0.03% | ||||||||
Accounting Standards Update 2016-02 | Maximum | |||||||||
Financing Receivable, Impaired [Line Items] | |||||||||
Expected decrease to regulatory capital ratios | 0.09% |
Securities - Summary of Securit
Securities - Summary of Securities (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Available for Sale | ||
Securities available-for-sale, amortized cost | $ 25,017 | $ 29,127 |
Gross Unrealized Gains | 10 | 11 |
Gross Unrealized Losses | (620) | (454) |
Fair Value | 24,407 | 28,684 |
Total equity securities | ||
Amortized Cost | 2,559 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | 108 | |
Equity securities, at fair value | 2,451 | 2,448 |
Held to Maturity | ||
Amortized Cost | 47,455 | 58,002 |
Gross Unrealized Gains | 389 | 812 |
Gross Unrealized Losses | (578) | (265) |
Fair Value | 47,266 | 58,549 |
U.S. Government agency securities | ||
Available for Sale | ||
Securities available-for-sale, amortized cost | 11,800 | 10,105 |
Gross Unrealized Gains | 5 | 0 |
Gross Unrealized Losses | (170) | (48) |
Fair Value | 11,635 | 10,057 |
Municipal securities | ||
Available for Sale | ||
Securities available-for-sale, amortized cost | 487 | 494 |
Gross Unrealized Gains | 0 | 1 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | 487 | 495 |
Held to Maturity | ||
Amortized Cost | 36,436 | 46,614 |
Gross Unrealized Gains | 389 | 812 |
Gross Unrealized Losses | (111) | (20) |
Fair Value | 36,714 | 47,406 |
U.S. Government-sponsored enterprises (“GSE”) – residential mortgage-backed securities | ||
Available for Sale | ||
Securities available-for-sale, amortized cost | 6,131 | 8,362 |
Gross Unrealized Gains | 1 | 0 |
Gross Unrealized Losses | (185) | (143) |
Fair Value | 5,947 | 8,219 |
Held to Maturity | ||
Amortized Cost | 7,423 | 7,339 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (211) | (98) |
Fair Value | 7,212 | 7,241 |
U.S. Government collateralized residential mortgage obligations | ||
Available for Sale | ||
Securities available-for-sale, amortized cost | 4,600 | 7,672 |
Gross Unrealized Gains | 1 | 1 |
Gross Unrealized Losses | (178) | (191) |
Fair Value | 4,423 | 7,482 |
Held to Maturity | ||
Amortized Cost | 1,769 | 2,224 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (57) | (46) |
Fair Value | 1,712 | 2,178 |
Corporate debt securities, primarily financial institutions | ||
Available for Sale | ||
Securities available-for-sale, amortized cost | 1,999 | 2,494 |
Gross Unrealized Gains | 3 | 9 |
Gross Unrealized Losses | (87) | (72) |
Fair Value | 1,915 | 2,431 |
Held to Maturity | ||
Amortized Cost | 1,827 | 1,825 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (199) | (101) |
Fair Value | $ 1,628 | 1,724 |
Equity Securities | ||
Available for Sale | ||
Securities available-for-sale, amortized cost | 2,503 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | (55) | |
Fair Value | $ 2,448 |
Securities - Investments Classi
Securities - Investments Classified by Contractual Maturity Date (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Amortized Cost | ||
Due in one year or less | $ 1,254 | |
Due in one year through five years | 7,548 | |
Due in five years through ten years | 1,354 | |
Due after ten years | 4,130 | |
Sub-total | 14,286 | |
Securities available-for-sale, amortized cost | 25,017 | $ 29,127 |
Fair Value | ||
Due in one year or less | 1,245 | |
Due in one year through five years | 7,505 | |
Due in five years through ten years | 1,321 | |
Due after ten years | 3,966 | |
Sub-total | 14,037 | |
Securities available for sale | 24,407 | 28,684 |
Amortized Cost | ||
Due in one year or less | 5,415 | |
Due in one year through five years | 1,290 | |
Due in five years through ten years | 8,071 | |
Due after ten years | 23,487 | |
Sub-total | 38,263 | |
Amortized Cost | 47,455 | 58,002 |
Fair Value | ||
Due in one year or less | 5,423 | |
Due in one year through five years | 1,314 | |
Due in five years through ten years | 7,993 | |
Due after ten years | 23,612 | |
Sub-total | 38,342 | |
Securities held-to-maturity, fair value | 47,266 | 58,549 |
U.S. Government-sponsored enterprises (“GSE”) – residential mortgage-backed securities | ||
Amortized Cost | ||
No single maturity | 6,131 | |
Securities available-for-sale, amortized cost | 6,131 | 8,362 |
Fair Value | ||
No single maturity | 5,947 | |
Securities available for sale | 5,947 | 8,219 |
Amortized Cost | ||
No single maturity | 7,423 | |
Amortized Cost | 7,423 | 7,339 |
Fair Value | ||
No single maturity | 7,212 | |
Securities held-to-maturity, fair value | 7,212 | 7,241 |
U.S. Government collateralized residential mortgage obligations | ||
Amortized Cost | ||
No single maturity | 4,600 | |
Securities available-for-sale, amortized cost | 4,600 | 7,672 |
Fair Value | ||
No single maturity | 4,423 | |
Securities available for sale | 4,423 | 7,482 |
Amortized Cost | ||
No single maturity | 1,769 | |
Amortized Cost | 1,769 | 2,224 |
Fair Value | ||
No single maturity | 1,712 | |
Securities held-to-maturity, fair value | 1,712 | $ 2,178 |
Securities Portfolio Without CRA | ||
Amortized Cost | ||
Securities available-for-sale, amortized cost | 25,017 | |
Fair Value | ||
Securities available for sale | 24,407 | |
Amortized Cost | ||
Amortized Cost | 47,455 | |
Fair Value | ||
Securities held-to-maturity, fair value | $ 47,266 |
Securities - Narrative (Details
Securities - Narrative (Details) | 12 Months Ended | |||
Dec. 31, 2018USD ($)security | Dec. 31, 2017USD ($)security | Dec. 31, 2016USD ($)security | Jan. 01, 2018USD ($) | |
Schedule of Available-for-sale Securities [Line Items] | ||||
Number of securities sold | security | 0 | 0 | 1 | |
Proceeds from sale of securities held to maturity | $ 0 | $ 0 | $ 1,076,000 | |
Realized gain on sale of securities held to maturity | 0 | 0 | $ 72,000 | |
Carrying value of investment securities | $ 24,700,000 | 34,600,000 | ||
Securities in an unrealized loss position | security | 71 | |||
Number of individual trust preferred securities | security | 3 | |||
Other than temporary impairments recognized | $ 0 | 0 | ||
Equity securities, at fair value | 2,451,000 | 2,448,000 | ||
Equity securities unrealized loss | 53,000 | |||
Not Other Than Temporary Impaired | Corporate Debt Securities, Primarily Financial Institutions | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Not other-than-temporarily impaired securities amortized cost | 2,300,000 | |||
Not other-than-temporarily impaired securities fair value | $ 2,100,000 | |||
Retained Earnings | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
AOCI reclassification due to adoption of ASU 2016-01 | $ (39,000) | |||
Retained Earnings | Accounting Standards Update 2016-01 | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
AOCI reclassification due to adoption of ASU 2016-01 | $ 39,000 |
Securities - Securities in a Co
Securities - Securities in a Continuous Unrealized Loss Position (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Schedule of Available-for-sale Securities [Line Items] | ||
Less than 12 Months, Fair Value | $ 12,038 | $ 30,507 |
Less than 12 Months, Unrealized Loss | (114) | (152) |
12 Months of More, Fair Value | 34,009 | 23,486 |
12 Months or More, Unrealized Losses | (1,084) | (622) |
Fair Value Total | 46,047 | 53,993 |
Unrealized Loss Total | (1,198) | (774) |
U.S. Government agency securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less than 12 Months, Fair Value | 4,842 | 8,229 |
Less than 12 Months, Unrealized Loss | (72) | (46) |
12 Months of More, Fair Value | 5,470 | 1,766 |
12 Months or More, Unrealized Losses | (98) | (2) |
Fair Value Total | 10,312 | 9,995 |
Unrealized Loss Total | (170) | (48) |
Municipal securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less than 12 Months, Fair Value | 5,227 | 14,170 |
Less than 12 Months, Unrealized Loss | (24) | (20) |
12 Months of More, Fair Value | 8,378 | 0 |
12 Months or More, Unrealized Losses | (87) | 0 |
Fair Value Total | 13,605 | 14,170 |
Unrealized Loss Total | (111) | (20) |
U.S. Government-sponsored enterprises (“GSE”) – residential mortgage-backed securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less than 12 Months, Fair Value | 1,330 | 6,302 |
Less than 12 Months, Unrealized Loss | (10) | (66) |
12 Months of More, Fair Value | 11,675 | 9,123 |
12 Months or More, Unrealized Losses | (386) | (175) |
Fair Value Total | 13,005 | 15,425 |
Unrealized Loss Total | (396) | (241) |
U.S. Government collateralized residential mortgage obligations | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less than 12 Months, Fair Value | 146 | 1,806 |
Less than 12 Months, Unrealized Loss | 0 | (20) |
12 Months of More, Fair Value | 5,938 | 7,500 |
12 Months or More, Unrealized Losses | (235) | (217) |
Fair Value Total | 6,084 | 9,306 |
Unrealized Loss Total | (235) | (237) |
Corporate debt securities, primarily financial institutions | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less than 12 Months, Fair Value | 493 | 0 |
Less than 12 Months, Unrealized Loss | (8) | 0 |
12 Months of More, Fair Value | 2,548 | 2,648 |
12 Months or More, Unrealized Losses | (278) | (173) |
Fair Value Total | 3,041 | 2,648 |
Unrealized Loss Total | $ (286) | (173) |
Equity Securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less than 12 Months, Fair Value | 0 | |
Less than 12 Months, Unrealized Loss | 0 | |
12 Months of More, Fair Value | 2,449 | |
12 Months or More, Unrealized Losses | (55) | |
Fair Value Total | 2,449 | |
Unrealized Loss Total | $ (55) |
Loans Receivable and Allowanc_3
Loans Receivable and Allowance for Loan Losses - Components of Loan Portfolio (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Loans and Leases Receivable Disclosure [Line Items] | ||||
Total Loans Receivable | $ 922,043 | $ 851,639 | ||
Allowance for loan losses | (11,398) | (10,668) | $ (9,565) | $ (8,713) |
Net unearned fees | (742) | (765) | ||
Net Loans | 909,903 | 840,206 | ||
Commercial Portfolio Segment | Commercial and industrial | ||||
Loans and Leases Receivable Disclosure [Line Items] | ||||
Total Loans Receivable | 109,362 | 101,371 | ||
Allowance for loan losses | (745) | (930) | (844) | (990) |
Commercial Portfolio Segment | Real estate – construction | ||||
Loans and Leases Receivable Disclosure [Line Items] | ||||
Total Loans Receivable | 144,865 | 118,094 | ||
Allowance for loan losses | (2,049) | (1,389) | (1,276) | (1,283) |
Commercial Portfolio Segment | Real estate – commercial | ||||
Loans and Leases Receivable Disclosure [Line Items] | ||||
Total Loans Receivable | 552,549 | 537,733 | ||
Allowance for loan losses | (7,283) | (7,325) | (6,315) | (5,599) |
Consumer Portfolio Segment | Real estate – residential | ||||
Loans and Leases Receivable Disclosure [Line Items] | ||||
Total Loans Receivable | 84,123 | 64,238 | ||
Allowance for loan losses | (668) | (502) | (463) | (304) |
Consumer Portfolio Segment | Consumer | ||||
Loans and Leases Receivable Disclosure [Line Items] | ||||
Total Loans Receivable | 31,144 | 30,203 | ||
Allowance for loan losses | $ (147) | $ (174) | $ (244) | $ (242) |
Loans Receivable and Allowanc_4
Loans Receivable and Allowance for Loan Losses - Past Due Financing Receivables (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | $ 6,192 | $ 2,972 |
Current | 915,851 | 848,667 |
Total Loans Receivable | 922,043 | 851,639 |
Loans receivable >90 days and still accruing | 0 | 0 |
30-59 Days Past Due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | 4,238 | 752 |
60-89 Days Past Due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | 564 | 150 |
Greater than 90 Days | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | 1,390 | 2,070 |
Commercial Portfolio Segment | Commercial and industrial | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | 865 | 1,014 |
Current | 108,497 | 100,357 |
Total Loans Receivable | 109,362 | 101,371 |
Loans receivable >90 days and still accruing | 0 | 0 |
Commercial Portfolio Segment | Commercial and industrial | 30-59 Days Past Due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | 100 | 224 |
Commercial Portfolio Segment | Commercial and industrial | 60-89 Days Past Due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | 0 | 0 |
Commercial Portfolio Segment | Commercial and industrial | Greater than 90 Days | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | 765 | 790 |
Commercial Portfolio Segment | Real estate – construction | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | 3,725 | 150 |
Current | 141,140 | 117,944 |
Total Loans Receivable | 144,865 | 118,094 |
Loans receivable >90 days and still accruing | 0 | 0 |
Commercial Portfolio Segment | Real estate – construction | 30-59 Days Past Due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | 3,575 | 0 |
Commercial Portfolio Segment | Real estate – construction | 60-89 Days Past Due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | 0 | 0 |
Commercial Portfolio Segment | Real estate – construction | Greater than 90 Days | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | 150 | 150 |
Commercial Portfolio Segment | Real estate – commercial | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | 617 | 515 |
Current | 551,932 | 537,218 |
Total Loans Receivable | 552,549 | 537,733 |
Loans receivable >90 days and still accruing | 0 | 0 |
Commercial Portfolio Segment | Real estate – commercial | 30-59 Days Past Due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | 563 | 146 |
Commercial Portfolio Segment | Real estate – commercial | 60-89 Days Past Due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | 0 | 150 |
Commercial Portfolio Segment | Real estate – commercial | Greater than 90 Days | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | 54 | 219 |
Consumer Portfolio Segment | Real estate – residential | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | 791 | 1,007 |
Current | 83,332 | 63,231 |
Total Loans Receivable | 84,123 | 64,238 |
Loans receivable >90 days and still accruing | 0 | 0 |
Consumer Portfolio Segment | Real estate – residential | 30-59 Days Past Due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | 0 | 290 |
Consumer Portfolio Segment | Real estate – residential | 60-89 Days Past Due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | 564 | 0 |
Consumer Portfolio Segment | Real estate – residential | Greater than 90 Days | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | 227 | 717 |
Consumer Portfolio Segment | Consumer | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | 194 | 286 |
Current | 30,950 | 29,917 |
Total Loans Receivable | 31,144 | 30,203 |
Loans receivable >90 days and still accruing | 0 | 0 |
Consumer Portfolio Segment | Consumer | 30-59 Days Past Due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | 0 | 92 |
Consumer Portfolio Segment | Consumer | 60-89 Days Past Due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | 0 | 0 |
Consumer Portfolio Segment | Consumer | Greater than 90 Days | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Past due | $ 194 | $ 194 |
Loans Receivable and Allowanc_5
Loans Receivable and Allowance for Loan Losses - Financing Receivables, Non Accrual Status (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Loans and Leases Receivable Disclosure [Line Items] | ||
Non-accrual loans | $ 1,390 | $ 2,070 |
Commercial Portfolio Segment | Commercial and industrial | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Non-accrual loans | 765 | 790 |
Commercial Portfolio Segment | Real estate – construction | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Non-accrual loans | 150 | 150 |
Commercial Portfolio Segment | Real estate – commercial | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Non-accrual loans | 54 | 219 |
Consumer Portfolio Segment | Real estate – residential | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Non-accrual loans | 227 | 717 |
Consumer Portfolio Segment | Consumer | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Non-accrual loans | $ 194 | $ 194 |
Loans Receivable and Allowanc_6
Loans Receivable and Allowance for Loan Losses - Impaired Financing Receivables (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
With an allowance recorded: | |||
Related Allowance | $ 0 | $ 0 | $ 2 |
Total: | |||
Recorded Investment, Net of Charge-offs | 8,233 | 8,122 | 9,623 |
Unpaid Principal Balance | 8,233 | 8,469 | 9,715 |
Average Recorded Investment | 7,278 | 8,631 | 9,937 |
Interest Income Recognized | 289 | 310 | 383 |
Commercial Portfolio Segment | Commercial and industrial | |||
With no related allowance recorded: | |||
Recorded Investment, Net of Charge-offs | 4,200 | 3,350 | 3,402 |
Unpaid Principal Balance | 4,200 | 3,697 | 3,415 |
Average Recorded Investment | 3,201 | 3,758 | 3,575 |
Interest Income Recognized | 131 | 152 | 174 |
With an allowance recorded: | |||
Recorded Investment, Net of Charge-offs | 0 | 0 | 498 |
Unpaid Principal Balance | 0 | 0 | 498 |
Related Allowance | 0 | 0 | 2 |
Average Recorded Investment | 0 | 0 | 507 |
Interest Income Recognized | 0 | 0 | 15 |
Total: | |||
Recorded Investment, Net of Charge-offs | 4,200 | 3,350 | 3,900 |
Unpaid Principal Balance | 4,200 | 3,697 | 3,913 |
Average Recorded Investment | 3,201 | 3,758 | 4,082 |
Interest Income Recognized | 131 | 152 | 189 |
Commercial Portfolio Segment | Real estate – construction | |||
With no related allowance recorded: | |||
Recorded Investment, Net of Charge-offs | 3,082 | 3,148 | 3,036 |
Unpaid Principal Balance | 3,082 | 3,148 | 3,036 |
Average Recorded Investment | 3,116 | 3,163 | 3,073 |
Interest Income Recognized | 134 | 133 | 129 |
With an allowance recorded: | |||
Recorded Investment, Net of Charge-offs | 0 | 0 | 0 |
Unpaid Principal Balance | 0 | 0 | 0 |
Related Allowance | 0 | 0 | 0 |
Average Recorded Investment | 0 | 0 | 0 |
Interest Income Recognized | 0 | 0 | 0 |
Total: | |||
Recorded Investment, Net of Charge-offs | 3,082 | 3,148 | 3,036 |
Unpaid Principal Balance | 3,082 | 3,148 | 3,036 |
Average Recorded Investment | 3,116 | 3,163 | 3,073 |
Interest Income Recognized | 134 | 133 | 129 |
Commercial Portfolio Segment | Real estate – commercial | |||
With no related allowance recorded: | |||
Recorded Investment, Net of Charge-offs | 168 | 344 | 1,548 |
Unpaid Principal Balance | 168 | 344 | 1,577 |
Average Recorded Investment | 174 | 411 | 1,618 |
Interest Income Recognized | 6 | 6 | 47 |
With an allowance recorded: | |||
Recorded Investment, Net of Charge-offs | 0 | 0 | 0 |
Unpaid Principal Balance | 0 | 0 | 0 |
Related Allowance | 0 | 0 | 0 |
Average Recorded Investment | 0 | 0 | 0 |
Interest Income Recognized | 0 | 0 | 0 |
Total: | |||
Recorded Investment, Net of Charge-offs | 168 | 344 | 1,548 |
Unpaid Principal Balance | 168 | 344 | 1,577 |
Average Recorded Investment | 174 | 411 | 1,618 |
Interest Income Recognized | 6 | 6 | 47 |
Consumer Portfolio Segment | Real estate – residential | |||
With no related allowance recorded: | |||
Recorded Investment, Net of Charge-offs | 589 | 1,086 | 1,139 |
Unpaid Principal Balance | 589 | 1,086 | 1,189 |
Average Recorded Investment | 593 | 1,105 | 1,164 |
Interest Income Recognized | 18 | 18 | 18 |
With an allowance recorded: | |||
Recorded Investment, Net of Charge-offs | 0 | 0 | 0 |
Unpaid Principal Balance | 0 | 0 | 0 |
Related Allowance | 0 | 0 | 0 |
Average Recorded Investment | 0 | 0 | 0 |
Interest Income Recognized | 0 | 0 | 0 |
Total: | |||
Recorded Investment, Net of Charge-offs | 589 | 1,086 | 1,139 |
Unpaid Principal Balance | 589 | 1,086 | 1,189 |
Average Recorded Investment | 593 | 1,105 | 1,164 |
Interest Income Recognized | 18 | 18 | 18 |
Consumer Portfolio Segment | Consumer | |||
With no related allowance recorded: | |||
Recorded Investment, Net of Charge-offs | 194 | 194 | 0 |
Unpaid Principal Balance | 194 | 194 | 0 |
Average Recorded Investment | 194 | 194 | 0 |
Interest Income Recognized | 0 | 1 | 0 |
With an allowance recorded: | |||
Recorded Investment, Net of Charge-offs | 0 | 0 | 0 |
Unpaid Principal Balance | 0 | 0 | 0 |
Related Allowance | 0 | 0 | 0 |
Average Recorded Investment | 0 | 0 | 0 |
Interest Income Recognized | 0 | 0 | 0 |
Total: | |||
Recorded Investment, Net of Charge-offs | 194 | 194 | 0 |
Unpaid Principal Balance | 194 | 194 | 0 |
Average Recorded Investment | 194 | 194 | 0 |
Interest Income Recognized | $ 0 | $ 1 | $ 0 |
Loans Receivable and Allowanc_7
Loans Receivable and Allowance for Loan Losses - Financing Receivable Credit Quality Indicators (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | $ 922,043 | $ 851,639 |
Pass | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 907,176 | 828,780 |
Special Mention | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 4,425 | 10,763 |
Substandard | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 10,442 | 11,980 |
Doubtful | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 0 | 116 |
Commercial Portfolio Segment | Commercial and industrial | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 109,362 | 101,371 |
Commercial Portfolio Segment | Commercial and industrial | Pass | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 104,557 | 97,160 |
Commercial Portfolio Segment | Commercial and industrial | Special Mention | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 126 | 796 |
Commercial Portfolio Segment | Commercial and industrial | Substandard | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 4,679 | 3,299 |
Commercial Portfolio Segment | Commercial and industrial | Doubtful | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 0 | 116 |
Commercial Portfolio Segment | Real estate – construction | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 144,865 | 118,094 |
Commercial Portfolio Segment | Real estate – construction | Pass | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 138,858 | 112,353 |
Commercial Portfolio Segment | Real estate – construction | Special Mention | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 1,577 | 4,252 |
Commercial Portfolio Segment | Real estate – construction | Substandard | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 4,430 | 1,489 |
Commercial Portfolio Segment | Real estate – construction | Doubtful | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 0 | 0 |
Commercial Portfolio Segment | Real estate – commercial | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 552,549 | 537,733 |
Commercial Portfolio Segment | Real estate – commercial | Pass | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 549,083 | 525,951 |
Commercial Portfolio Segment | Real estate – commercial | Special Mention | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 2,722 | 5,681 |
Commercial Portfolio Segment | Real estate – commercial | Substandard | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 744 | 6,101 |
Commercial Portfolio Segment | Real estate – commercial | Doubtful | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 0 | 0 |
Consumer Portfolio Segment | Real estate – residential | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 84,123 | 64,238 |
Consumer Portfolio Segment | Real estate – residential | Pass | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 83,896 | 63,521 |
Consumer Portfolio Segment | Real estate – residential | Special Mention | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 0 | 0 |
Consumer Portfolio Segment | Real estate – residential | Substandard | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 227 | 717 |
Consumer Portfolio Segment | Real estate – residential | Doubtful | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 0 | 0 |
Consumer Portfolio Segment | Consumer | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 31,144 | 30,203 |
Consumer Portfolio Segment | Consumer | Pass | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 30,782 | 29,795 |
Consumer Portfolio Segment | Consumer | Special Mention | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 0 | 34 |
Consumer Portfolio Segment | Consumer | Substandard | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | 362 | 374 |
Consumer Portfolio Segment | Consumer | Doubtful | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Total Loans Receivable | $ 0 | $ 0 |
Loans Receivable and Allowanc_8
Loans Receivable and Allowance for Loan Losses - Change in Allowance for Loan Losses By Class of Loan (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Allowance for Loan and Lease Losses [Roll Forward] | |||||||||||
Beginning balance | $ 10,668 | $ 9,565 | $ 10,668 | $ 9,565 | $ 8,713 | ||||||
Charge-offs | (128) | (487) | (449) | ||||||||
Recoveries | 83 | 60 | 786 | ||||||||
Provision | $ 0 | $ 150 | $ 225 | 400 | $ 675 | $ 255 | $ 375 | 225 | 775 | 1,530 | 515 |
Ending balance | 11,398 | 10,668 | 11,398 | 10,668 | 9,565 | ||||||
Commercial Portfolio Segment | Commercial and industrial | |||||||||||
Allowance for Loan and Lease Losses [Roll Forward] | |||||||||||
Beginning balance | 930 | 844 | 930 | 844 | 990 | ||||||
Charge-offs | (116) | (381) | 0 | ||||||||
Recoveries | 33 | 18 | 12 | ||||||||
Provision | (102) | 449 | (158) | ||||||||
Ending balance | 745 | 930 | 745 | 930 | 844 | ||||||
Commercial Portfolio Segment | Real estate – construction | |||||||||||
Allowance for Loan and Lease Losses [Roll Forward] | |||||||||||
Beginning balance | 1,389 | 1,276 | 1,389 | 1,276 | 1,283 | ||||||
Charge-offs | 0 | 0 | 0 | ||||||||
Recoveries | 3 | 12 | 12 | ||||||||
Provision | 657 | 101 | (19) | ||||||||
Ending balance | 2,049 | 1,389 | 2,049 | 1,389 | 1,276 | ||||||
Commercial Portfolio Segment | Real estate – commercial | |||||||||||
Allowance for Loan and Lease Losses [Roll Forward] | |||||||||||
Beginning balance | 7,325 | 6,315 | 7,325 | 6,315 | 5,599 | ||||||
Charge-offs | (12) | 0 | (444) | ||||||||
Recoveries | 26 | 24 | 696 | ||||||||
Provision | (56) | 986 | 464 | ||||||||
Ending balance | 7,283 | 7,325 | 7,283 | 7,325 | 6,315 | ||||||
Consumer Portfolio Segment | Real estate – residential | |||||||||||
Allowance for Loan and Lease Losses [Roll Forward] | |||||||||||
Beginning balance | 502 | 463 | 502 | 463 | 304 | ||||||
Charge-offs | 0 | 0 | 0 | ||||||||
Recoveries | 0 | 0 | 0 | ||||||||
Provision | 166 | 39 | 159 | ||||||||
Ending balance | 668 | 502 | 668 | 502 | 463 | ||||||
Consumer Portfolio Segment | Consumer | |||||||||||
Allowance for Loan and Lease Losses [Roll Forward] | |||||||||||
Beginning balance | 174 | 244 | 174 | 244 | 242 | ||||||
Charge-offs | 0 | (106) | (5) | ||||||||
Recoveries | 21 | 6 | 66 | ||||||||
Provision | (48) | 30 | (59) | ||||||||
Ending balance | 147 | 174 | 147 | 174 | 244 | ||||||
Unallocated | |||||||||||
Allowance for Loan and Lease Losses [Roll Forward] | |||||||||||
Beginning balance | $ 348 | $ 423 | 348 | 423 | 295 | ||||||
Charge-offs | 0 | 0 | 0 | ||||||||
Recoveries | 0 | 0 | 0 | ||||||||
Provision | 158 | (75) | 128 | ||||||||
Ending balance | $ 506 | $ 348 | $ 506 | $ 348 | $ 423 |
Loans Receivable and Allowanc_9
Loans Receivable and Allowance for Loan Losses - Allowance for Credit Losses on Financing Receivables (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Loans and Leases Receivable Disclosure [Line Items] | ||||
Allowance for loan losses | $ 11,398 | $ 10,668 | $ 9,565 | $ 8,713 |
Allowance for loan losses individually evaluated for impairment | 0 | 0 | ||
Allowance for loan losses collectively evaluated for impairment | 11,398 | 10,668 | ||
Total Loans Receivable | 922,043 | 851,639 | ||
Loans individually evaluated for impairment | 8,233 | 8,122 | ||
Loans collectively evaluated for impairment | 913,810 | 843,517 | ||
Commercial Portfolio Segment | Commercial and industrial | ||||
Loans and Leases Receivable Disclosure [Line Items] | ||||
Allowance for loan losses | 745 | 930 | 844 | 990 |
Allowance for loan losses individually evaluated for impairment | 0 | 0 | ||
Allowance for loan losses collectively evaluated for impairment | 745 | 930 | ||
Total Loans Receivable | 109,362 | 101,371 | ||
Loans individually evaluated for impairment | 4,200 | 3,350 | ||
Loans collectively evaluated for impairment | 105,162 | 98,021 | ||
Commercial Portfolio Segment | Real estate – construction | ||||
Loans and Leases Receivable Disclosure [Line Items] | ||||
Allowance for loan losses | 2,049 | 1,389 | 1,276 | 1,283 |
Allowance for loan losses individually evaluated for impairment | 0 | 0 | ||
Allowance for loan losses collectively evaluated for impairment | 2,049 | 1,389 | ||
Total Loans Receivable | 144,865 | 118,094 | ||
Loans individually evaluated for impairment | 3,082 | 3,148 | ||
Loans collectively evaluated for impairment | 141,783 | 114,946 | ||
Commercial Portfolio Segment | Real estate – commercial | ||||
Loans and Leases Receivable Disclosure [Line Items] | ||||
Allowance for loan losses | 7,283 | 7,325 | 6,315 | 5,599 |
Allowance for loan losses individually evaluated for impairment | 0 | 0 | ||
Allowance for loan losses collectively evaluated for impairment | 7,283 | 7,325 | ||
Total Loans Receivable | 552,549 | 537,733 | ||
Loans individually evaluated for impairment | 168 | 344 | ||
Loans collectively evaluated for impairment | 552,381 | 537,389 | ||
Consumer Portfolio Segment | Real estate – residential | ||||
Loans and Leases Receivable Disclosure [Line Items] | ||||
Allowance for loan losses | 668 | 502 | 463 | 304 |
Allowance for loan losses individually evaluated for impairment | 0 | 0 | ||
Allowance for loan losses collectively evaluated for impairment | 668 | 502 | ||
Total Loans Receivable | 84,123 | 64,238 | ||
Loans individually evaluated for impairment | 589 | 1,086 | ||
Loans collectively evaluated for impairment | 83,534 | 63,152 | ||
Consumer Portfolio Segment | Consumer | ||||
Loans and Leases Receivable Disclosure [Line Items] | ||||
Allowance for loan losses | 147 | 174 | 244 | 242 |
Allowance for loan losses individually evaluated for impairment | 0 | 0 | ||
Allowance for loan losses collectively evaluated for impairment | 147 | 174 | ||
Total Loans Receivable | 31,144 | 30,203 | ||
Loans individually evaluated for impairment | 194 | 194 | ||
Loans collectively evaluated for impairment | 30,950 | 30,009 | ||
Unallocated | ||||
Loans and Leases Receivable Disclosure [Line Items] | ||||
Allowance for loan losses | 506 | 348 | $ 423 | $ 295 |
Allowance for loan losses individually evaluated for impairment | 0 | 0 | ||
Allowance for loan losses collectively evaluated for impairment | 506 | 348 | ||
Total Loans Receivable | 0 | 0 | ||
Loans individually evaluated for impairment | 0 | 0 | ||
Loans collectively evaluated for impairment | $ 0 | $ 0 |
Loans Receivable and Allowan_10
Loans Receivable and Allowance for Loan Losses - Troubled Debt Restructurings on Financing Receivables (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018USD ($)loan | Dec. 31, 2017USD ($)loan | |
Financing Receivable, Modifications [Line Items] | ||
Number of Contracts | loan | 4 | |
Pre-Modification Outstanding Recorded Investment | $ 470 | |
Post-Modification Outstanding Recorded Investment | $ 470 | |
Commercial Portfolio Segment | Commercial and industrial | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Contracts | loan | 2 | 3 |
Pre-Modification Outstanding Recorded Investment | $ 2,738 | $ 320 |
Post-Modification Outstanding Recorded Investment | $ 2,738 | $ 320 |
Commercial Portfolio Segment | Real estate – construction | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Contracts | loan | 1 | |
Pre-Modification Outstanding Recorded Investment | $ 150 | |
Post-Modification Outstanding Recorded Investment | $ 150 |
Loans Receivable and Allowan_11
Loans Receivable and Allowance for Loan Losses - Narrative (Details) | 12 Months Ended | 36 Months Ended | ||
Dec. 31, 2018USD ($)loan | Dec. 31, 2017USD ($)loan | Dec. 31, 2016USD ($) | Dec. 31, 2018USD ($)loan | |
Loans and Leases Receivable Disclosure [Line Items] | ||||
Total TDRs | $ 7,700,000 | $ 7,000,000 | $ 7,700,000 | |
Current TDRs | 6,800,000 | $ 6,000,000 | 6,800,000 | |
Number of Contracts | loan | 4 | |||
Non-accrual loans, value | 900,000 | $ 1,000,000 | 900,000 | |
Value of TDRS paid in full | 80,887,000 | 106,389,000 | $ 59,605,000 | |
Specific reserve for TDR | 0 | $ 0 | ||
Number of loans receivables modified as TDRs within 12 months of restructure | loan | 0 | |||
Trouble Debt Restructuring | ||||
Loans and Leases Receivable Disclosure [Line Items] | ||||
Number of TDRs paid in full | $ 0 | 2 | ||
Value of TDRS paid in full | $ 726,000 | |||
Non Accrual Loans | ||||
Loans and Leases Receivable Disclosure [Line Items] | ||||
Number of Contracts | loan | 6 | 7 |
Premises and Equipment (Details
Premises and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | $ 17,243 | $ 17,090 |
Less accumulated depreciation and amortization | (11,326) | (10,851) |
Total premises and equipment, net | 5,917 | 6,239 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | $ 1,487 | 1,487 |
Buildings | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 30 years | |
Premises and equipment, gross | $ 2,114 | 2,120 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | $ 3,342 | 3,432 |
Leasehold improvements | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 5 years | |
Leasehold improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 15 years | |
Furniture and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | $ 9,033 | 8,915 |
Furniture and equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 2 years | |
Furniture and equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 7 years | |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | $ 1,267 | $ 1,136 |
Anticipated additional costs | $ 250 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Goodwill impairment amount | $ 0 | $ 0 |
Goodwill | $ 18,109,000 | $ 18,109,000 |
Deposits - Deposits Components
Deposits - Deposits Components (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Deposits [Abstract] | ||
Demand, non-interest bearing | $ 176,655 | $ 167,297 |
Demand, interest-bearing, money market and savings | 495,949 | 534,939 |
Time, $250,000 and over | 38,512 | 14,853 |
Time, other | 206,238 | 144,468 |
Total Deposits | $ 917,354 | $ 861,557 |
Deposits - Maturities of Time D
Deposits - Maturities of Time Deposits (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Deposits [Abstract] | |
2019 | $ 107,854 |
2020 | 76,664 |
2021 | 21,678 |
2022 | 23,453 |
2023 | 15,101 |
Total time deposits | $ 244,750 |
Deposits - Narrative (Details)
Deposits - Narrative (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Net Investment Income [Line Items] | ||
Carrying value of certificates of deposit | $ 39,807 | $ 44,436 |
Demand deposit overdrafts reclassified as loan balances | 183 | 944 |
Certificates of Deposit | ||
Net Investment Income [Line Items] | ||
Brokered certificates of deposit | $ 74,080 | $ 40,702 |
Securities Sold Under Agreeme_3
Securities Sold Under Agreements to Repurchase - Repurchase Agreements (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Transfer of Financial Assets Accounted for as Sales [Line Items] | |||
Balance at year-end | $ 19,402 | $ 27,120 | |
Securities Sold under Agreements to Repurchase | |||
Transfer of Financial Assets Accounted for as Sales [Line Items] | |||
Balance at year-end | 19,402 | 27,120 | $ 19,915 |
Average during the year | 19,738 | 22,066 | 19,309 |
Maximum month-end balance | $ 23,884 | $ 27,120 | $ 22,105 |
Weighted average rate during the year | 0.29% | 0.30% | 0.32% |
Weighted average rate at December 31 | 0.24% | 0.25% | 0.24% |
Securities Sold Under Agreeme_4
Securities Sold Under Agreements to Repurchase - Maturities of Repurchase Agreements (Details) - Securities Sold under Agreements to Repurchase - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
U.S. Government agency securities | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities sold under repurchase agreements | $ 11,566 | $ 9,995 |
U.S. Government agency securities | Overnight and Continuous | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities sold under repurchase agreements | 11,566 | 9,995 |
U.S. Government agency securities | Up to 30 days | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities sold under repurchase agreements | 0 | 0 |
U.S. Government agency securities | 30 to 90 days | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities sold under repurchase agreements | 0 | 0 |
U.S. Government agency securities | Over 90 days | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities sold under repurchase agreements | 0 | 0 |
U.S. Government-sponsored enterprises (“GSE”) – residential mortgage-backed securities | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities sold under repurchase agreements | 4,289 | 5,558 |
U.S. Government-sponsored enterprises (“GSE”) – residential mortgage-backed securities | Overnight and Continuous | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities sold under repurchase agreements | 4,289 | 5,558 |
U.S. Government-sponsored enterprises (“GSE”) – residential mortgage-backed securities | Up to 30 days | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities sold under repurchase agreements | 0 | 0 |
U.S. Government-sponsored enterprises (“GSE”) – residential mortgage-backed securities | 30 to 90 days | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities sold under repurchase agreements | 0 | 0 |
U.S. Government-sponsored enterprises (“GSE”) – residential mortgage-backed securities | Over 90 days | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities sold under repurchase agreements | 0 | 0 |
U.S. Government collateralized residential mortgage obligations | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities sold under repurchase agreements | 10,334 | 13,440 |
U.S. Government collateralized residential mortgage obligations | Overnight and Continuous | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities sold under repurchase agreements | 10,334 | 13,440 |
U.S. Government collateralized residential mortgage obligations | Up to 30 days | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities sold under repurchase agreements | 0 | 0 |
U.S. Government collateralized residential mortgage obligations | 30 to 90 days | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities sold under repurchase agreements | 0 | 0 |
U.S. Government collateralized residential mortgage obligations | Over 90 days | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities sold under repurchase agreements | 0 | 0 |
Securities Pledged as Collateral | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities sold under repurchase agreements | 26,189 | 28,993 |
Gross amount of recognized liabilities for repurchase agreements and securities lending | 19,402 | 27,120 |
Excess of collateral pledged over recognized liability | 6,787 | 1,873 |
Securities Pledged as Collateral | Overnight and Continuous | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities sold under repurchase agreements | 26,189 | 28,993 |
Securities Pledged as Collateral | Up to 30 days | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities sold under repurchase agreements | 0 | 0 |
Securities Pledged as Collateral | 30 to 90 days | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities sold under repurchase agreements | 0 | 0 |
Securities Pledged as Collateral | Over 90 days | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities sold under repurchase agreements | $ 0 | $ 0 |
FHLB and Other Borrowings - Nar
FHLB and Other Borrowings - Narrative (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Line of Credit Facility [Line Items] | ||
Advances from FHLB | $ 22,500,000 | $ 25,800,000 |
Unsecured Debt | ||
Line of Credit Facility [Line Items] | ||
Maximum borrowing capacity, line of credit | 36,000,000 | |
Outstanding borrowings | 0 | 0 |
Federal Home Loan Bank | ||
Line of Credit Facility [Line Items] | ||
Credit facility remaining borrowing capacity | 47,600,000 | |
Collateral pledged, amount | 147,600,000 | |
Advances from FHLB | $ 22,500,000 | $ 25,800,000 |
FHLB advances, average interest rate | 1.93% | 1.87% |
Letters of credit from FHLB | $ 75,100,000 | |
Federal Fund Borrowing Line | Atlantic Community Bankers Bank | ||
Line of Credit Facility [Line Items] | ||
Maximum borrowing capacity, line of credit | 10,000,000 | |
Outstanding borrowings | $ 0 | $ 0 |
FHLB and Other Borrowings - Mat
FHLB and Other Borrowings - Maturities of Long-term Debt (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Debt Instrument [Line Items] | ||
FHLB borrowings | $ 22,500 | $ 25,800 |
October 2018 | ||
Debt Instrument [Line Items] | ||
FHLB borrowings | $ 0 | 2,000 |
Fixed rate note, rate | 1.65% | |
Fixed rate note, original term | 5 years | |
January 2018 | ||
Debt Instrument [Line Items] | ||
FHLB borrowings | $ 0 | 1,300 |
Fixed rate note, rate | 1.31% | |
Fixed rate note, original term | 3 years | |
January 2019 | ||
Debt Instrument [Line Items] | ||
FHLB borrowings | $ 1,800 | 1,800 |
Fixed rate note, rate | 1.59% | |
Fixed rate note, original term | 4 years | |
January 2020 | ||
Debt Instrument [Line Items] | ||
FHLB borrowings | $ 2,700 | 2,700 |
Fixed rate note, rate | 1.81% | |
Fixed rate note, original term | 5 years | |
January 2021 | ||
Debt Instrument [Line Items] | ||
FHLB borrowings | $ 2,500 | 2,500 |
Fixed rate note, rate | 2.03% | |
Fixed rate note, original term | 6 years | |
July 2019 | ||
Debt Instrument [Line Items] | ||
FHLB borrowings | $ 1,000 | 1,000 |
Fixed rate note, rate | 1.09% | |
Fixed rate note, original term | 3 years | |
July 2021 | ||
Debt Instrument [Line Items] | ||
FHLB borrowings | $ 1,000 | 1,000 |
Fixed rate note, rate | 1.42% | |
Fixed rate note, original term | 5 years | |
July 2023 | ||
Debt Instrument [Line Items] | ||
FHLB borrowings | $ 1,000 | 1,000 |
Fixed rate note, rate | 1.70% | |
Fixed rate note, original term | 7 years | |
August 2022 | ||
Debt Instrument [Line Items] | ||
FHLB borrowings | $ 7,500 | 7,500 |
Fixed rate note, rate | 2.07% | |
Fixed rate note, original term | 5 years | |
October 2021 | ||
Debt Instrument [Line Items] | ||
FHLB borrowings | $ 5,000 | $ 5,000 |
Fixed rate note, rate | 2.16% | |
Fixed rate note, original term | 4 years |
Subordinated Debentures (Detail
Subordinated Debentures (Details) - USD ($) | 1 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Debt Instrument [Line Items] | ||||
Proceeds from subordinated debt placement, net of issuance costs | $ 10,000,000 | |||
Subordinated debt interest rate | 6.25% | |||
Subordinated debt | $ 9,923,000 | $ 9,888,000 | $ 9,900,000 | |
Subordinated Debt | ||||
Debt Instrument [Line Items] | ||||
Unamortized debt issuance costs | $ 77,000 | $ 112,000 | $ 145,000 | |
Effective interest rate on subordinated debt | 6.67% | |||
Subordinated Debt | London Interbank Offered Rate (LIBOR) | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 4.64% |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - USD ($) | Sep. 01, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | ||||
Maximum annual contributions per employee, percent | 100.00% | |||
Employer contribution amount | $ 335,000 | $ 304,000 | $ 288,000 | |
President and Chief Executive officer | Deferred Compensation, Excluding Share-based Payments and Retirement Benefits | ||||
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | ||||
President and CEO deferred maximum amount | $ 100,000 | |||
Additional employer contributions | 70,000 | 70,000 | ||
Salaries and Employee Benefits | ||||
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | ||||
Expenses related to defined contribution plan | 319,000 | 309,000 | $ 204,000 | |
Salaries and Employee Benefits | President and Chief Executive officer | Deferred Compensation, Excluding Share-based Payments and Retirement Benefits | ||||
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | ||||
Expenses related to plan | 147,000 | 100,000 | ||
Other Liabilities | ||||
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | ||||
Deferred compensation liability | 2,100,000 | 1,900,000 | ||
Other Liabilities | President and Chief Executive officer | Deferred Compensation, Excluding Share-based Payments and Retirement Benefits | ||||
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | ||||
Unfunded liability related to deferred compensation | $ 329,000 | $ 183,000 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Provisional income tax expense due to remeasurement of deferred tax asset as result of the Tax Cuts and Jobs Act | $ 1,780 | ||
Reduction in income tax expense due to adoption of ASU 2016-09 | $ 216 | $ 191 |
Income Taxes - Components of In
Income Taxes - Components of Income Tax Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |||||||||||
Current | $ 4,419 | $ 4,957 | $ 4,791 | ||||||||
Deferred | (429) | 1,061 | (463) | ||||||||
Income tax expense | $ 1,130 | $ 1,013 | $ 1,040 | $ 807 | $ 2,943 | $ 1,202 | $ 922 | $ 951 | $ 3,990 | $ 6,018 | $ 4,328 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Statutory Income Tax (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Amount | |||||||||||
Federal income tax expense at statutory rate | $ 3,191 | $ 4,257 | $ 4,406 | ||||||||
Tax exempt interest | (233) | (358) | (334) | ||||||||
Bank owned life insurance income | (110) | (185) | (455) | ||||||||
State income taxes, net of federal income tax benefit | 1,366 | 734 | 712 | ||||||||
Reduction in Federal tax rate | 0 | 1,778 | 0 | ||||||||
Stock-based compensation | (216) | (191) | 0 | ||||||||
Other, net | (8) | (17) | (1) | ||||||||
Income tax expense | $ 1,130 | $ 1,013 | $ 1,040 | $ 807 | $ 2,943 | $ 1,202 | $ 922 | $ 951 | $ 3,990 | $ 6,018 | $ 4,328 |
Percentage | |||||||||||
Federal income tax expense at statutory rate | 21.00% | 34.00% | 34.00% | ||||||||
Tax exempt interest | (1.50%) | (2.90%) | (2.60%) | ||||||||
Bank owned life insurance income | (0.70%) | (1.50%) | (3.50%) | ||||||||
State income taxes, net of federal income tax benefit | 9.00% | 5.90% | 5.50% | ||||||||
Reduction in Federal tax rate | 0.00% | 14.30% | 0.00% | ||||||||
Stock-based compensation | (1.40%) | (1.50%) | 0.00% | ||||||||
Other, net | (0.10%) | (0.20%) | 0.00% | ||||||||
Income tax expense, percent | 26.30% | 48.10% | 33.40% |
Income Taxes - Components of Ne
Income Taxes - Components of Net Deferred Tax Asset Included in Other Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Deferred tax assets: | ||
Allowance for loan losses | $ 3,219 | $ 3,012 |
Depreciation and amortization | 288 | 415 |
Deferred compensation | 1,299 | 1,063 |
Unrealized loss on securities available for sale | 165 | 194 |
Other | 2 | 35 |
Total deferred tax assets | 4,973 | 4,719 |
Deferred tax liabilities: | ||
Deferred loan origination costs | (384) | (366) |
Total deferred tax liabilities | (384) | (366) |
Net Deferred Tax Asset | $ 4,589 | $ 4,353 |
Earnings Per Common Share (Deta
Earnings Per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Net income | $ 3,046 | $ 2,834 | $ 2,650 | $ 2,676 | $ 335 | $ 2,237 | $ 2,128 | $ 1,802 | $ 11,206 | $ 6,502 | $ 8,631 |
Preferred stock dividend | 0 | 0 | 0 | ||||||||
Net Income available to common shareholders | $ 11,206 | $ 6,502 | $ 8,631 | ||||||||
Weighted average common shares outstanding (in shares) | 8,508,000 | 8,388,000 | 8,321,000 | ||||||||
Effect of dilutive securities, stock options and restricted stock (in shares) | 194,000 | 270,000 | 209,000 | ||||||||
Weighted average common shares outstanding used to calculate diluted earnings per share (in shares) | 8,702,000 | 8,658,000 | 8,530,000 | ||||||||
Basic earnings per common share (in dollars per share) | $ 0.36 | $ 0.33 | $ 0.31 | $ 0.32 | $ 0.04 | $ 0.27 | $ 0.25 | $ 0.22 | $ 1.32 | $ 0.78 | $ 1.04 |
Diluted earnings per common share (in dollars per share) | $ 0.35 | $ 0.33 | $ 0.30 | $ 0.31 | $ 0.04 | $ 0.26 | $ 0.25 | $ 0.21 | $ 1.29 | $ 0.75 | $ 1.01 |
Employee Stock Option | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Stock options that were anti-dilutive (in shares) | 0 | 0 | 0 |
Lease Commitments and Total R_3
Lease Commitments and Total Rental Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Leases, Operating [Abstract] | |||
Rent expense | $ 2,000 | $ 2,100 | $ 2,000 |
2019 | 1,481 | ||
2020 | 1,384 | ||
2021 | 1,420 | ||
2022 | 1,465 | ||
2023 | 1,490 | ||
Thereafter | 8,508 | ||
Total | $ 15,748 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) - USD ($) | Dec. 04, 2018 | Jun. 07, 2018 | Jan. 30, 2018 | Feb. 28, 2017 | Jan. 19, 2017 | Oct. 11, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Common stock dividend percentage | 5.00% | 5.00% | |||||||
Expected life (in years) | 7 years 182 days | ||||||||
Intrinsic value of stock options exercised | $ 1,573,800 | $ 911,700 | $ 190,800 | ||||||
Proceeds from exercise of stock options | 423,000 | 275,900 | 104,100 | ||||||
Tax benefit | $ 210,000 | $ 152,000 | $ 25,000 | ||||||
Other awards shares issued (in shares) | 800 | 1,100 | 1,050 | ||||||
Other awards, market value | $ 13,300 | $ 19,950 | $ 10,390 | ||||||
Employee Stock Option | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Options granted, number of shares (in shares) | 0 | ||||||||
Stock-based compensation expense | $ 58,000 | 80,000 | 113,000 | ||||||
Unrecognized compensation cost related to non-vested options | $ 54,000 | ||||||||
Weighted average life unrecognized compensation costs recognized over | 1 year 9 months 18 days | ||||||||
Restricted Stock | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Stock-based compensation expense | $ 259,000 | 199,000 | 118,000 | ||||||
Weighted average life unrecognized compensation costs recognized over | 3 years 5 months 18 days | ||||||||
Tax benefit | $ 6,000 | $ 39,000 | $ 0 | ||||||
Restricted stock vesting percentage | 33.33% | ||||||||
Restricted stock vesting period | 3 years | ||||||||
Restricted stock awards (in shares) | 14,250 | 11,000 | 8,400 | 34,450 | |||||
Unrecognized compensation cost related to restricted stock | $ 872,000 | ||||||||
Two River Bancorp 2007 Equity Incentive Plan | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Common stock remaining and available for future issuance (in shares) | 111,419 | ||||||||
Common stock dividend percentage | 5.00% | ||||||||
Two River Bancorp 2007 Equity Incentive Plan | Maximum | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Expected life (in years) | 10 years | ||||||||
Tranche One | Restricted Stock | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Restricted stock vesting percentage | 50.00% | 50.00% | |||||||
Tranche Two | Restricted Stock | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Restricted stock vesting percentage | 50.00% | 50.00% | |||||||
Restricted stock vesting period | 2 years | 2 years |
Stock-Based Compensation - Outs
Stock-Based Compensation - Outstanding Stock Options (Details) | 12 Months Ended |
Dec. 31, 2018USD ($)$ / sharesshares | |
Number of Shares | |
Options outstanding, number of shares (in shares) | shares | 361,507 |
Options exercised, number of shares (in shares) | shares | (115,824) |
Options forfeited, number of shares (in shares) | shares | (3,150) |
Options outstanding, number of shares (in shares) | shares | 242,533 |
Weighted Average Price | |
Options outstanding, weighted average price (in dollars per share) | $ 5.20 |
Options exercised, weighted average price (in dollars per share) | 3.65 |
Options forfeited, weighted average price (in dollars per share) | 8.83 |
Options outstanding, weighted average price (in dollars per share) | $ 5.89 |
Options exercisable, number of shares (in shares) | shares | 221,231 |
Options exercisable, weighted average price (in dollars per share) | $ 5.59 |
Options outstanding, weighted average remaining contractual life (in years) | 3 years 8 months 27 days |
Options outstanding, aggregate intrinsic value | $ | $ 2,269,959 |
Options exercisable, weighted average remaining contractual life (in years) | 3 years 5 months 12 days |
Options exercisable, aggregate intrinsic value | $ | $ 2,138,979 |
Minimum | |
Weighted Average Price | |
Options price range (in dollars per share) | $ 2.87 |
Maximum | |
Weighted Average Price | |
Options price range (in dollars per share) | $ 11.21 |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock Options Outstanding (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Options outstanding (in shares) | 242,533 | |
Weighted- Average Exercise Price (in dollars per share) | $ 5.89 | $ 5.20 |
Range 1 | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Exercise price range, lower limit (in dollars per share) | 2.87 | |
Exercise price range, upper limit (in dollars per share) | $ 3.65 | |
Options outstanding (in shares) | 51,862 | |
Weighted-Average Remaining Contractual Life (years) | 7 months 6 days | |
Weighted- Average Exercise Price (in dollars per share) | $ 3.10 | |
Range 2 | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Exercise price range, lower limit (in dollars per share) | 4.94 | |
Exercise price range, upper limit (in dollars per share) | $ 5.23 | |
Options outstanding (in shares) | 94,320 | |
Weighted-Average Remaining Contractual Life (years) | 3 years 3 months 7 days | |
Weighted- Average Exercise Price (in dollars per share) | $ 5.03 | |
Range 3 | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Exercise price range, lower limit (in dollars per share) | 7.06 | |
Exercise price range, upper limit (in dollars per share) | $ 8 | |
Options outstanding (in shares) | 62,625 | |
Weighted-Average Remaining Contractual Life (years) | 5 years 4 months 21 days | |
Weighted- Average Exercise Price (in dollars per share) | $ 7.53 | |
Range 4 | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Exercise price range, lower limit (in dollars per share) | 8.59 | |
Exercise price range, upper limit (in dollars per share) | $ 11.21 | |
Options outstanding (in shares) | 33,726 | |
Weighted-Average Remaining Contractual Life (years) | 7 years 3 months | |
Weighted- Average Exercise Price (in dollars per share) | $ 9.51 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Estimated Fair Value Inputs (Details) | Oct. 11, 2016$ / shares |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Dividend yield | 1.33% |
Expected volatility | 27.67% |
Risk-free interest rate | 1.54% |
Expected life (in years) | 7 years 182 days |
Weighted average fair value of options granted (in dollars per share) | $ 3.05 |
Stock-Based Compensation - Rest
Stock-Based Compensation - Restricted Stock (Details) - Restricted Stock - $ / shares | Dec. 04, 2018 | Jun. 07, 2018 | Jan. 30, 2018 | Dec. 31, 2018 |
Number of Shares | ||||
Unvested at beginning of period (in shares) | 49,021 | |||
Restricted stock earned (in shares) | (14,931) | |||
Granted (in shares) | 14,250 | 11,000 | 8,400 | 34,450 |
Forefited (in shares) | (500) | |||
Unvested at end of period (in shares) | 68,040 | |||
Weighted Average Price | ||||
Unvested at beginning of period (in dollars per share) | $ 14.01 | |||
Restricted stock earned (in dollars per share) | 12.93 | |||
Granted (in dollars per share) | 16.78 | |||
Forefited (in dollars per share) | 18.32 | |||
Unvested at end of period (in dollars per share) | $ 15.61 |
Transactions with Executive O_2
Transactions with Executive Officers, Directors and Principal Shareholders (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Related Party Transaction [Line Items] | ||
Ownership percentage by noncontrolling owners | 10.00% | |
Extensions of credit to related parties | $ 12,400,000 | $ 13,000,000 |
Loans outstanding to related parties | 8,900,000 | 7,700,000 |
New loans to related parties | 6,300,000 | |
Repayments and other reductions | 5,100,000 | |
Deposits | 24,600,000 | 12,900,000 |
Securities sold in agreements to repurchase | 39,000 | 6,100,000 |
Director | Payments For Products Or Services | ||
Related Party Transaction [Line Items] | ||
Related party transaction amount | 0 | 0 |
Atlantic Community Bankers Bank | Compliance Reviews, Internet And Telephone Services | ||
Related Party Transaction [Line Items] | ||
Related party transaction amount | $ 428,000 | $ 439,000 |
Financial Instruments with Of_2
Financial Instruments with Off-balance Sheet Risk (Details) - Commitments to Extend Credit - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Commitments to extend credit, including unused lines of credit, amount | $ 264.1 | $ 245.8 |
Letters of credit for customers | $ 4.2 | $ 5.2 |
Regulatory Matters - Narrative
Regulatory Matters - Narrative (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 01, 2016 |
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | |||
Tier 1 capital to risk weighted assets, to be well capitalized under prompt corrective action regulations, ratio | 6.00% | 6.00% | |
Common equity tier 1 capital, required for capital adequacy, ratio | 4.50% | 4.50% | 6.38% |
Tier 1 capital to risk weighted assets, for capital adequacy purposes, ratio | 6.00% | 6.00% | 7.88% |
Capital to risk weighted assets, for capital adequacy purposes, ratio | 8.00% | 8.00% | 9.88% |
Capital conservation buffer | 2.50% | ||
Parent Company | |||
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | |||
Highest amount of dividends that could be paid | $ 100.2 |
Regulatory Matters - Capital Ra
Regulatory Matters - Capital Ratios (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 01, 2016 |
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | |||
Common equity tier 1 capital, amount | $ 98,758 | $ 88,733 | |
Common equity tier 1 capital, ratio | 10.14% | 9.68% | |
Common equity tier 1 capital, required for capital adequacy, amount | $ 43,808 | $ 41,250 | |
Common equity tier 1 capital, required for capital adequacy, ratio | 4.50% | 4.50% | 6.38% |
Capital to risk weighted assets, amount | $ 120,156 | $ 109,401 | |
Capital to risk weighted assets, ratio | 12.34% | 11.93% | |
Capital to risk weighted assets, for capital adequacy purposes, amount | $ 77,882 | $ 73,362 | |
Capital to risk weighted assets, for capital adequacy purposes, ratio | 8.00% | 8.00% | 9.88% |
Tier 1 capital to risk weighted assets, amount | $ 98,758 | $ 88,733 | |
Tier 1 capital to risk weighted assets, ratio | 10.14% | 9.68% | |
Tier 1 capital to risk weighted assets, for capital adequacy purposes, amount | $ 58,411 | $ 55,000 | |
Tier 1 capital to risk weighted assets, for capital adequacy purposes, ratio | 6.00% | 6.00% | 7.88% |
Tier 1 capital to risk weighted assets, to be well capitalized under prompt corrective action regulations, amount | $ 58,411 | $ 55,000 | |
Tier 1 capital to risk weighted assets, to be well capitalized under prompt corrective action regulations, ratio | 6.00% | 6.00% | |
Tier 1 capital to average assets, amount | $ 98,758 | $ 88,733 | |
Tier 1 capital to average assets, ratio | 9.10% | 8.85% | |
Tier 1 capital to average assets, for capital adequacy purposes, amount | $ 43,389 | $ 40,105 | |
Tier 1 capital to average assets, for capital adequacy purposes, ratio | 4.00% | 4.00% | |
Two River Community Bank | |||
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | |||
Common equity tier 1 capital, amount | $ 107,891 | $ 97,723 | |
Common equity tier 1 capital, ratio | 11.09% | 10.66% | |
Common equity tier 1 capital, required for capital adequacy, amount | $ 43,782 | $ 41,253 | |
Common equity tier 1 capital, required for capital adequacy, ratio | 4.50% | 4.50% | |
Common equity tier 1 capital, required to be well-capitalized under prompt corrective action regulations, amount | $ 63,240 | $ 59,587 | |
Common equity tier 1 capital, required to be well-capitalized under prompt corrective action regulations, ratio | 6.50% | 6.50% | |
Capital to risk weighted assets, amount | $ 119,289 | $ 108,391 | |
Capital to risk weighted assets, ratio | 12.26% | 11.82% | |
Capital to risk weighted assets, for capital adequacy purposes, amount | $ 77,834 | $ 73,361 | |
Capital to risk weighted assets, for capital adequacy purposes, ratio | 8.00% | 8.00% | |
Capital to risk weighted assets, to be well capitalized under prompt corrective action regulations, amount | $ 97,293 | $ 91,701 | |
Capital to risk weighted assets, to be well capitalized under prompt corrective action regulations, ratio | 10.00% | 10.00% | |
Tier 1 capital to risk weighted assets, amount | $ 107,891 | $ 97,723 | |
Tier 1 capital to risk weighted assets, ratio | 11.09% | 10.66% | |
Tier 1 capital to risk weighted assets, for capital adequacy purposes, amount | $ 58,376 | $ 55,004 | |
Tier 1 capital to risk weighted assets, for capital adequacy purposes, ratio | 6.00% | 6.00% | |
Tier 1 capital to risk weighted assets, to be well capitalized under prompt corrective action regulations, amount | $ 77,834 | $ 73,338 | |
Tier 1 capital to risk weighted assets, to be well capitalized under prompt corrective action regulations, ratio | 8.00% | 8.00% | |
Tier 1 capital to average assets, amount | $ 107,891 | $ 97,723 | |
Tier 1 capital to average assets, ratio | 9.95% | 9.76% | |
Tier 1 capital to average assets, for capital adequacy purposes, amount | $ 43,363 | $ 40,050 | |
Tier 1 capital to average assets, for capital adequacy purposes, ratio | 4.00% | 4.00% | |
Tier 1 capital to average assets, to be well capitalized under prompt corrective action regulations, amount | $ 54,204 | $ 50,063 | |
Tier 1 capital to average assets, to be well capitalized under prompt corrective action regulations, ratio | 5.00% | 5.00% |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Fair Value on Recurring Basis (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | $ 24,407,000 | $ 28,684,000 |
Equity Securities | 2,451,000 | 2,448,000 |
Fair Value, Measurements, Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 24,407,000 | 28,684,000 |
Equity Securities | 2,451,000 | 2,448,000 |
Fair Value, Measurements, Recurring | (Level 1) Quoted Prices in Active Markets for Identical Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Equity Securities | 2,451,000 | 2,448,000 |
Fair Value, Measurements, Recurring | (Level 2) Significant Other Observable Inputs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 24,407,000 | 28,684,000 |
Equity Securities | 0 | 0 |
Fair Value, Measurements, Recurring | (Level 3) Significant Unobservable Inputs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Equity Securities | 0 | 0 |
U.S. Government agency securities | Fair Value, Measurements, Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 11,635,000 | 10,057,000 |
U.S. Government agency securities | Fair Value, Measurements, Recurring | (Level 1) Quoted Prices in Active Markets for Identical Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
U.S. Government agency securities | Fair Value, Measurements, Recurring | (Level 2) Significant Other Observable Inputs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 11,635,000 | 10,057,000 |
U.S. Government agency securities | Fair Value, Measurements, Recurring | (Level 3) Significant Unobservable Inputs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Municipal securities | Fair Value, Measurements, Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 487,000 | 495,000 |
Municipal securities | Fair Value, Measurements, Recurring | (Level 1) Quoted Prices in Active Markets for Identical Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Municipal securities | Fair Value, Measurements, Recurring | (Level 2) Significant Other Observable Inputs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 487,000 | 495,000 |
Municipal securities | Fair Value, Measurements, Recurring | (Level 3) Significant Unobservable Inputs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
U.S. Government-sponsored enterprises (“GSE”) – residential mortgage-backed securities | Fair Value, Measurements, Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 5,947,000 | 8,219,000 |
U.S. Government-sponsored enterprises (“GSE”) – residential mortgage-backed securities | Fair Value, Measurements, Recurring | (Level 1) Quoted Prices in Active Markets for Identical Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
U.S. Government-sponsored enterprises (“GSE”) – residential mortgage-backed securities | Fair Value, Measurements, Recurring | (Level 2) Significant Other Observable Inputs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 5,947,000 | 8,219,000 |
U.S. Government-sponsored enterprises (“GSE”) – residential mortgage-backed securities | Fair Value, Measurements, Recurring | (Level 3) Significant Unobservable Inputs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
U.S. Government collateralized residential mortgage obligations | Fair Value, Measurements, Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 4,423,000 | 7,482,000 |
U.S. Government collateralized residential mortgage obligations | Fair Value, Measurements, Recurring | (Level 1) Quoted Prices in Active Markets for Identical Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
U.S. Government collateralized residential mortgage obligations | Fair Value, Measurements, Recurring | (Level 2) Significant Other Observable Inputs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 4,423,000 | 7,482,000 |
U.S. Government collateralized residential mortgage obligations | Fair Value, Measurements, Recurring | (Level 3) Significant Unobservable Inputs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Corporate debt securities, primarily financial institutions | Fair Value, Measurements, Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 1,915,000 | 2,431,000 |
Corporate debt securities, primarily financial institutions | Fair Value, Measurements, Recurring | (Level 1) Quoted Prices in Active Markets for Identical Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Corporate debt securities, primarily financial institutions | Fair Value, Measurements, Recurring | (Level 2) Significant Other Observable Inputs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 1,915,000 | 2,431,000 |
Corporate debt securities, primarily financial institutions | Fair Value, Measurements, Recurring | (Level 3) Significant Unobservable Inputs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | $ 0 | $ 0 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Fair Value on Nonrecurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
OREO | $ 585 | $ 0 |
Fair Value, Measurements, Nonrecurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
OREO | 585 | |
Impaired loans, net of allowance recorded and partial charge-offs | 116 | |
Fair Value, Measurements, Nonrecurring | (Level 1) Quoted Prices in Active Markets for Identical Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
OREO | 0 | |
Impaired loans, net of allowance recorded and partial charge-offs | 0 | |
Fair Value, Measurements, Nonrecurring | (Level 2) Significant Other Observable Inputs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
OREO | 0 | |
Impaired loans, net of allowance recorded and partial charge-offs | 0 | |
Fair Value, Measurements, Nonrecurring | (Level 3) Significant Unobservable Inputs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
OREO | $ 585 | |
Impaired loans, net of allowance recorded and partial charge-offs | $ 116 |
Fair Value of Financial Instr_5
Fair Value of Financial Instruments - Narrative (Details) | 12 Months Ended | |
Dec. 31, 2018USD ($)loanreal_estate_property | Dec. 31, 2017USD ($)loanreal_estate_property | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Securities available for sale | $ 24,407,000 | $ 28,684,000 |
OREO | $ 585,000 | $ 0 |
Properties held in OREO | real_estate_property | 0 | |
Mortgage loans in process of foreclosure | real_estate_property | 3 | 3 |
Mortgage loans in process of foreclosure, amount | $ 598,000 | $ 490,000 |
(Level 3) Significant Unobservable Inputs | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Level 3 securities | 0 | 0 |
Impaired Loan | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Liquidation Expense | $ 0 | $ 0 |
Other Real Estate Owned | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Liquidation expense percentage | 9.50% | |
Appraisal Values | Impaired Loan | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Discounted loans | loan | 0 | 0 |
Fair Value, Measurements, Recurring | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Securities available for sale | $ 24,407,000 | $ 28,684,000 |
Fair Value, Measurements, Recurring | (Level 3) Significant Unobservable Inputs | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Securities available for sale | $ 0 | $ 0 |
Fair Value of Financial Instr_6
Fair Value of Financial Instruments - Fair Value by Balance Sheet Grouping (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Securities available for sale | $ 24,407 | $ 28,684 |
Securities held-to-maturity, fair value | 47,266 | 58,549 |
Equity Securities | 2,451 | 2,448 |
Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | 48,126 | 48,219 |
Securities available for sale | 24,407 | 28,684 |
Securities held-to-maturity, fair value | 47,455 | 58,002 |
Equity Securities | 2,451 | 2,448 |
Restricted investments | 6,082 | 5,430 |
Loans held for sale | 1,496 | 2,581 |
Loans receivable, net | 909,903 | 840,206 |
Accrued interest receivable | 2,583 | 2,554 |
Deposits | 917,354 | 861,557 |
Securities sold under agreements to repurchase | 19,402 | 27,120 |
FHLB and other borrowings | 22,500 | 25,800 |
Subordinated debt | 9,923 | 9,888 |
Accrued interest payable | 119 | 70 |
Estimated Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | 48,126 | 48,219 |
Securities available for sale | 24,407 | 28,684 |
Securities held-to-maturity, fair value | 47,266 | 58,549 |
Equity Securities | 2,451 | 2,448 |
Restricted investments | 6,082 | 5,430 |
Loans held for sale | 1,525 | 2,738 |
Loans receivable, net | 887,374 | 841,477 |
Accrued interest receivable | 2,583 | 2,554 |
Deposits | 915,435 | 860,129 |
Securities sold under agreements to repurchase | 19,402 | 27,120 |
FHLB and other borrowings | 21,966 | 25,382 |
Subordinated debt | 9,999 | 9,812 |
Accrued interest payable | 119 | 70 |
(Level 1) Quoted Prices in Active Markets for Identical Assets | Estimated Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | 48,126 | 48,219 |
Securities available for sale | 0 | |
Securities held-to-maturity, fair value | 0 | 0 |
Equity Securities | 2,451 | 2,448 |
Restricted investments | 0 | 0 |
Loans held for sale | 0 | 0 |
Loans receivable, net | 0 | 0 |
Accrued interest receivable | 0 | 0 |
Deposits | 0 | 0 |
Securities sold under agreements to repurchase | 0 | 0 |
FHLB and other borrowings | 0 | 0 |
Subordinated debt | 0 | 0 |
Accrued interest payable | 0 | 0 |
(Level 2) Significant Other Observable Inputs | Estimated Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | 0 | 0 |
Securities available for sale | 24,407 | 28,684 |
Securities held-to-maturity, fair value | 47,266 | 58,549 |
Equity Securities | 0 | 0 |
Restricted investments | 0 | 0 |
Loans held for sale | 0 | 0 |
Loans receivable, net | 0 | 0 |
Accrued interest receivable | 643 | 638 |
Deposits | 915,435 | 860,129 |
Securities sold under agreements to repurchase | 19,402 | 27,120 |
FHLB and other borrowings | 21,966 | 25,382 |
Subordinated debt | 9,999 | 9,812 |
Accrued interest payable | 119 | 70 |
(Level 3) Significant Unobservable Inputs | Estimated Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | 0 | 0 |
Securities available for sale | 0 | 0 |
Securities held-to-maturity, fair value | 0 | 0 |
Equity Securities | 0 | 0 |
Restricted investments | 6,082 | 5,430 |
Loans held for sale | 1,525 | 2,738 |
Loans receivable, net | 887,374 | 841,477 |
Accrued interest receivable | 1,940 | 1,916 |
Deposits | 0 | 0 |
Securities sold under agreements to repurchase | 0 | 0 |
FHLB and other borrowings | 0 | 0 |
Subordinated debt | 0 | 0 |
Accrued interest payable | $ 0 | $ 0 |
Shareholders' Equity (Details)
Shareholders' Equity (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Jan. 24, 2019 | |
Class of Stock [Line Items] | ||
Common stock repurchased (in shares) | 16,351 | |
Common stock repurchased | $ 251,000 | |
Subsequent Event | ||
Class of Stock [Line Items] | ||
Stock repurchase program authorized amount | $ 2,000,000 |
Condensed Financial Statement_3
Condensed Financial Statements of Parent Company - Condensed Balance Sheets (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
ASSETS | ||||
Cash and cash equivalents | $ 48,126 | $ 48,219 | $ 42,077 | $ 46,727 |
Other assets | 7,207 | 5,753 | ||
Total Assets | 1,096,419 | 1,039,798 | ||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||
Subordinated debt | 9,923 | 9,888 | 9,900 | |
Other liabilities | 10,623 | 8,792 | ||
Shareholders’ equity | 116,498 | 106,571 | 100,716 | 93,002 |
Total Liabilities and Shareholders’ Equity | 1,096,419 | 1,039,798 | ||
Parent Company | ||||
ASSETS | ||||
Cash and cash equivalents | 355 | 41 | $ 161 | $ 333 |
Investments in subsidiaries | 125,631 | 115,507 | ||
Other assets | 591 | 1,067 | ||
Total Assets | 126,577 | 116,615 | ||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||
Subordinated debt | 9,923 | 9,888 | ||
Other liabilities | 156 | 156 | ||
Shareholders’ equity | 116,498 | 106,571 | ||
Total Liabilities and Shareholders’ Equity | $ 126,577 | $ 116,615 |
Condensed Financial Statement_4
Condensed Financial Statements of Parent Company - Condensed Statements of Operations and Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Condensed Statement of Income Captions [Line Items] | |||||||||||
Subordinated debt | $ 660 | $ 658 | $ 656 | ||||||||
Other operating expenses | 1,684 | 1,718 | 1,411 | ||||||||
Income before Income Taxes | $ 4,176 | $ 3,847 | $ 3,690 | $ 3,483 | $ 3,278 | $ 3,439 | $ 3,050 | $ 2,753 | 15,196 | 12,520 | 12,959 |
Income tax benefit | 1,130 | 1,013 | 1,040 | 807 | 2,943 | 1,202 | 922 | 951 | 3,990 | 6,018 | 4,328 |
Net Income | $ 3,046 | $ 2,834 | $ 2,650 | $ 2,676 | $ 335 | $ 2,237 | $ 2,128 | $ 1,802 | 11,206 | 6,502 | 8,631 |
Other comprehensive income (loss) | (121) | 87 | 8 | ||||||||
Total comprehensive income | 11,085 | 6,589 | 8,639 | ||||||||
Parent Company | |||||||||||
Condensed Statement of Income Captions [Line Items] | |||||||||||
Dividends from Bank | 1,533 | 1,578 | 1,636 | ||||||||
Subordinated debt | 660 | 658 | 656 | ||||||||
Other operating expenses | 317 | 279 | 233 | ||||||||
Income before Income Taxes | 556 | 641 | 747 | ||||||||
Income tax benefit | (406) | (483) | (239) | ||||||||
Income before undistributed income of subsidiaries | 962 | 1,124 | 986 | ||||||||
Equity in undistributed income of subsidiaries | 10,244 | 5,378 | 7,645 | ||||||||
Net Income | 11,206 | 6,502 | 8,631 | ||||||||
Other comprehensive income (loss) | (121) | 87 | 8 | ||||||||
Total comprehensive income | $ 11,085 | $ 6,589 | $ 8,639 |
Condensed Financial Statement_5
Condensed Financial Statements of Parent Company - Condensed Statements of Cash Flows (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flows from operating activities: | ||||||||||||
Net income | $ 3,046,000 | $ 2,834,000 | $ 2,650,000 | $ 2,676,000 | $ 335,000 | $ 2,237,000 | $ 2,128,000 | $ 1,802,000 | $ 11,206,000 | $ 6,502,000 | $ 8,631,000 | |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||
Amortization of subordinated debt issuance costs | 35,000 | 33,000 | 31,000 | |||||||||
Stock-based compensation expense | 317,000 | 279,000 | 231,000 | |||||||||
Other, net | 1,831,000 | 1,034,000 | 1,487,000 | |||||||||
Net Cash Provided by Operating Activities | 14,524,000 | 12,755,000 | 8,906,000 | |||||||||
Cash Flows from Investing Activities | ||||||||||||
Net Cash Used in Investing Activities | (57,921,000) | (98,295,000) | (79,701,000) | |||||||||
Cash Flows from Financing Activities | ||||||||||||
Proceeds from exercise of stock options | 423,000 | 275,900 | 104,100 | |||||||||
Tax benefit related to stock compensation | 0 | 59,000 | 25,000 | |||||||||
Proceeds from employee stock purchase plan | 63,000 | 67,000 | 56,000 | |||||||||
Proceeds from subordinated debt placement, net of issuance costs | $ 10,000,000 | |||||||||||
Common stock repurchased | (251,000) | 0 | (148,000) | |||||||||
Cash dividends paid - common stock | (1,710,000) | (1,415,000) | (1,193,000) | |||||||||
Net Cash Provided by Financing Activities | 43,304,000 | 91,682,000 | 66,145,000 | |||||||||
Net (Decrease) Increase in Cash and Cash Equivalents | (93,000) | 6,142,000 | (4,650,000) | |||||||||
Cash and Cash Equivalents – Beginning | 48,219,000 | 42,077,000 | 48,219,000 | 42,077,000 | 46,727,000 | |||||||
Cash and Cash Equivalents – Ending | 46,727,000 | 48,126,000 | 48,219,000 | 48,126,000 | 48,219,000 | 42,077,000 | ||||||
Parent Company | ||||||||||||
Cash flows from operating activities: | ||||||||||||
Net income | 11,206,000 | 6,502,000 | 8,631,000 | |||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||
Equity in undistributed income of subsidiaries, net of dividends received from Bank | (10,244,000) | (5,378,000) | (7,645,000) | |||||||||
Amortization of subordinated debt issuance costs | 35,000 | 33,000 | 31,000 | |||||||||
Stock-based compensation expense | 317,000 | 279,000 | 231,000 | |||||||||
Other, net | 475,000 | (543,000) | (264,000) | |||||||||
Net Cash Provided by Operating Activities | 1,789,000 | 893,000 | 984,000 | |||||||||
Cash Flows from Investing Activities | ||||||||||||
Contributions to subsidiary, net | 0 | 0 | 0 | |||||||||
Net Cash Used in Investing Activities | 0 | 0 | 0 | |||||||||
Cash Flows from Financing Activities | ||||||||||||
Proceeds from exercise of stock options | 423,000 | 276,000 | 104,000 | |||||||||
Tax benefit related to stock compensation | 0 | 59,000 | 25,000 | |||||||||
Proceeds from employee stock purchase plan | 63,000 | 67,000 | 56,000 | |||||||||
Redemption of preferred stock, Series C | 0 | 0 | 0 | |||||||||
Proceeds from subordinated debt placement, net of issuance costs | 0 | 0 | 0 | |||||||||
Common stock repurchased | (251,000) | 0 | (148,000) | |||||||||
Cash dividends paid - common stock | (1,710,000) | (1,415,000) | (1,193,000) | |||||||||
Cash dividends paid - preferred stock | 0 | 0 | 0 | |||||||||
Net Cash Provided by Financing Activities | (1,475,000) | (1,013,000) | (1,156,000) | |||||||||
Net (Decrease) Increase in Cash and Cash Equivalents | 314,000 | (120,000) | (172,000) | |||||||||
Cash and Cash Equivalents – Beginning | $ 41,000 | $ 161,000 | 41,000 | 161,000 | 333,000 | |||||||
Cash and Cash Equivalents – Ending | $ 333,000 | $ 355,000 | $ 41,000 | $ 355,000 | $ 41,000 | $ 161,000 |
Summary of Quarterly Results _3
Summary of Quarterly Results (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Interest income | $ 11,776 | $ 11,342 | $ 10,907 | $ 10,467 | $ 10,074 | $ 9,824 | $ 9,349 | $ 8,993 | $ 44,492 | $ 38,240 | $ 34,624 |
Interest expense | 2,523 | 2,239 | 1,937 | 1,667 | 1,545 | 1,408 | 1,391 | 1,363 | 8,366 | 5,707 | 5,164 |
Net Interest Income | 9,253 | 9,103 | 8,970 | 8,800 | 8,529 | 8,416 | 7,958 | 7,630 | 36,126 | 32,533 | 29,460 |
Provision for Loan Losses | 0 | 150 | 225 | 400 | 675 | 255 | 375 | 225 | 775 | 1,530 | 515 |
Net Interest Income after Provision for Loan Losses | 9,253 | 8,953 | 8,745 | 8,400 | 7,854 | 8,161 | 7,583 | 7,405 | 35,351 | 31,003 | 28,945 |
Non-interest income | 1,370 | 1,355 | 1,496 | 1,310 | 1,343 | 1,453 | 1,538 | 1,125 | 5,531 | 5,459 | 5,489 |
Non-interest expense | 6,447 | 6,461 | 6,551 | 6,227 | 5,919 | 6,175 | 6,071 | 5,777 | 25,686 | 23,942 | 21,475 |
Income before Income Taxes | 4,176 | 3,847 | 3,690 | 3,483 | 3,278 | 3,439 | 3,050 | 2,753 | 15,196 | 12,520 | 12,959 |
Income tax expense | 1,130 | 1,013 | 1,040 | 807 | 2,943 | 1,202 | 922 | 951 | 3,990 | 6,018 | 4,328 |
Net Income | $ 3,046 | $ 2,834 | $ 2,650 | $ 2,676 | $ 335 | $ 2,237 | $ 2,128 | $ 1,802 | $ 11,206 | $ 6,502 | $ 8,631 |
Basic earnings per common share (in dollars per share) | $ 0.36 | $ 0.33 | $ 0.31 | $ 0.32 | $ 0.04 | $ 0.27 | $ 0.25 | $ 0.22 | $ 1.32 | $ 0.78 | $ 1.04 |
Diluted earnings per common share (in dollars per share) | $ 0.35 | $ 0.33 | $ 0.30 | $ 0.31 | $ 0.04 | $ 0.26 | $ 0.25 | $ 0.21 | $ 1.29 | $ 0.75 | $ 1.01 |