Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2021 | Nov. 01, 2021 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2021 | |
Entity File Number | 001-38131 | |
Entity Registrant Name | Esquire Financial Holdings, Inc. | |
Entity Incorporation, State or Country Code | MD | |
Entity Tax Identification Number | 27-5107901 | |
Entity Address, Address Line One | 100 Jericho Quadrangle, Suite 100, | |
Entity Address, City or Town | Jericho | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 11753 | |
City Area Code | 516 | |
Local Phone Number | 535-2002 | |
Title of 12(b) Security | Common Stock, $0.01 par value | |
Trading Symbol | ESQ | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 7,847,494 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q3 | |
Entity Central Index Key | 0001531031 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
ASSETS | ||
Cash and cash equivalents | $ 138,235 | $ 65,185 |
Securities purchased under agreements to resell, at cost | 50,899 | 51,726 |
Securities available-for-sale, at fair value | 141,703 | 117,655 |
Securities, restricted, at cost | 2,680 | 2,694 |
Loans held for investment | 744,092 | 672,421 |
Less: allowance for loan losses | (8,665) | (11,402) |
Loans, net of allowance | 735,427 | 661,019 |
Premises and equipment, net | 3,443 | 3,017 |
Accrued interest receivable | 4,462 | 4,529 |
Other assets | 46,421 | 30,889 |
Total assets | 1,123,270 | 936,714 |
Deposits: | ||
Demand | 416,849 | 351,692 |
Savings, NOW and money market | 549,069 | 441,160 |
Time | 11,125 | 11,202 |
Total deposits | 977,043 | 804,054 |
Accrued expenses and other liabilities | 9,046 | 6,584 |
Total liabilities | 986,089 | 810,638 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock, par value $0.01; authorized 2,000,000 shares; none issued | ||
Common stock, par value $0.01; authorized 15,000,000 shares; 7,881,800 and 7,827,788 shares issued, respectively; and 7,847,494 and 7,793,482 shares outstanding, respectively | 79 | 78 |
Additional paid-in capital | 93,106 | 91,622 |
Retained earnings | 44,730 | 33,535 |
Accumulated other comprehensive (loss) income | (167) | 1,408 |
Treasury stock at cost, 34,306 and 34,306 shares, respectively | (567) | (567) |
Total stockholders' equity | 137,181 | 126,076 |
Total liabilities and stockholders' equity | $ 1,123,270 | $ 936,714 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Parentheticals) - $ / shares | Sep. 30, 2021 | Dec. 31, 2020 |
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 15,000,000 | 15,000,000 |
Common stock, shares issued | 7,881,800 | 7,827,788 |
Common stock, shares outstanding | 7,847,494 | 7,793,482 |
Treasury stock, shares | 34,306 | 34,306 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Interest income: | ||||
Loans | $ 10,709 | $ 8,936 | $ 30,408 | $ 26,055 |
Securities | 583 | 494 | 1,588 | 2,132 |
Securities purchased under agreements to resell | 150 | 470 | ||
Interest earning deposits and other | 51 | 66 | 134 | 348 |
Total interest income | 11,493 | 9,496 | 32,600 | 28,535 |
Interest expense: | ||||
Savings, NOW and money market deposits | 189 | 203 | 536 | 697 |
Time deposits | 19 | 85 | 59 | 277 |
Borrowings | 1 | 1 | 2 | 4 |
Total interest expense | 209 | 289 | 597 | 978 |
Net interest income | 11,284 | 9,207 | 32,003 | 27,557 |
Provision for loan losses | 3,750 | 900 | 6,400 | 4,700 |
Net interest income after provision for loan losses | 7,534 | 8,307 | 25,603 | 22,857 |
Noninterest income: | ||||
Unrealized loss on loans held for sale | (384) | (384) | ||
Total noninterest income | 4,924 | 3,884 | 15,856 | 9,959 |
Noninterest expense: | ||||
Employee compensation and benefits | 5,523 | 4,372 | 16,189 | 12,448 |
Occupancy and equipment | 696 | 615 | 2,104 | 1,735 |
Professional and consulting services | 773 | 845 | 2,352 | 2,382 |
FDIC and regulatory assessments | 111 | 95 | 320 | 280 |
Advertising and marketing | 289 | 171 | 936 | 289 |
Travel and business relations | 105 | 33 | 212 | 173 |
Data processing | 977 | 772 | 2,734 | 2,272 |
Other operating expenses | 533 | 382 | 1,466 | 1,351 |
Total noninterest expense | 9,007 | 7,285 | 26,313 | 20,930 |
Net income before income taxes | 3,451 | 4,906 | 15,146 | 11,886 |
Income tax expense | 932 | 1,300 | 3,951 | 3,150 |
Net income | $ 2,519 | $ 3,606 | $ 11,195 | $ 8,736 |
Earnings per share | ||||
Basic (in dollars per share) | $ 0.34 | $ 0.49 | $ 1.50 | $ 1.18 |
Diluted (in dollars per share) | $ 0.32 | $ 0.48 | $ 1.42 | $ 1.14 |
Merchant processing income | ||||
Noninterest income: | ||||
Noninterest income | $ 5,227 | $ 3,721 | $ 15,948 | $ 9,527 |
Customer related fees and service charges | ||||
Noninterest income: | ||||
Noninterest income | $ 81 | $ 163 | $ 292 | $ 432 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||||
Net income | $ 2,519 | $ 3,606 | $ 11,195 | $ 8,736 |
Other comprehensive (loss) income: | ||||
Unrealized (losses) gains arising during the period on securities available-for-sale | (686) | (343) | (2,203) | 1,772 |
Tax effect | 196 | 97 | 628 | (505) |
Total other comprehensive (loss) income | (490) | (246) | (1,575) | 1,267 |
Total comprehensive income | $ 2,029 | $ 3,360 | $ 9,620 | $ 10,003 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Common stock | Additional paid-in capital | Retained earnings (deficit) | Accumulated other comprehensive income (loss) | Treasury stock | Total |
Balance at Dec. 31, 2019 | $ 77 | $ 89,682 | $ 20,917 | $ 386 | $ 111,062 | |
Balance (in shares) at Dec. 31, 2019 | 7,652,170 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 8,736 | 8,736 | ||||
Other comprehensive income (loss) | 1,267 | 1,267 | ||||
Exercise of stock options, net of repurchases | 290 | 290 | ||||
Exercise of stock options, net of repurchases (in shares) | 44,976 | |||||
Stock compensation expense | 1,158 | 1,158 | ||||
Purchase of common stock | $ (567) | (567) | ||||
Purchase of common stock (in shares) | (34,306) | |||||
Balance at Sep. 30, 2020 | $ 77 | 91,130 | 29,653 | 1,653 | (567) | 121,946 |
Balance (in shares) at Sep. 30, 2020 | 7,662,840 | |||||
Balance at Jun. 30, 2020 | $ 77 | 90,747 | 26,047 | 1,899 | (567) | 118,203 |
Balance (in shares) at Jun. 30, 2020 | 7,662,840 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 3,606 | 3,606 | ||||
Other comprehensive income (loss) | (246) | (246) | ||||
Stock compensation expense | 383 | 383 | ||||
Balance at Sep. 30, 2020 | $ 77 | 91,130 | 29,653 | 1,653 | (567) | 121,946 |
Balance (in shares) at Sep. 30, 2020 | 7,662,840 | |||||
Balance at Dec. 31, 2020 | $ 78 | 91,622 | 33,535 | 1,408 | (567) | 126,076 |
Balance (in shares) at Dec. 31, 2020 | 7,793,482 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 11,195 | 11,195 | ||||
Other comprehensive income (loss) | (1,575) | (1,575) | ||||
Exercise of stock options, net of repurchases | $ 1 | 20 | 21 | |||
Exercise of stock options, net of repurchases (in shares) | 54,012 | |||||
Stock compensation expense | 1,464 | 1,464 | ||||
Balance at Sep. 30, 2021 | $ 79 | 93,106 | 44,730 | (167) | (567) | 137,181 |
Balance (in shares) at Sep. 30, 2021 | 7,847,494 | |||||
Balance at Jun. 30, 2021 | $ 79 | 92,624 | 42,211 | 323 | (567) | 134,670 |
Balance (in shares) at Jun. 30, 2021 | 7,830,704 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 2,519 | 2,519 | ||||
Other comprehensive income (loss) | (490) | (490) | ||||
Exercise of stock options, net of repurchases (in shares) | 16,790 | |||||
Stock compensation expense | 482 | 482 | ||||
Balance at Sep. 30, 2021 | $ 79 | $ 93,106 | $ 44,730 | $ (167) | $ (567) | $ 137,181 |
Balance (in shares) at Sep. 30, 2021 | 7,847,494 |
CONDENSED CONSOLIDATED STATEM_6
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Parenthetical) - shares | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | |
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY | |||
Repurchase of shares | 18,641 | 59,109 | 20,224 |
CONDENSED CONSOLIDATED STATEM_7
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Cash flows from operating activities: | ||
Net income | $ 11,195 | $ 8,736 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Provision for loan losses | 6,400 | 4,700 |
Unrealized loss on loans held for sale | 384 | |
Depreciation | 516 | 424 |
Stock compensation expense | 1,464 | 1,158 |
Net amortization (accretion): | ||
Securities | 613 | 742 |
Loans | (1,034) | (279) |
Right of use asset | 415 | 343 |
Software | 749 | 420 |
Changes in other assets and liabilities: | ||
Accrued interest receivable | 67 | (1,097) |
Other assets | (543) | (1,428) |
Operating lease liability | (405) | (352) |
Accrued expenses and other liabilities | 2,868 | 3,510 |
Net cash provided by operating activities | 22,689 | 16,877 |
Cash flows from investing activities: | ||
Net change in loans | (94,358) | (71,266) |
Net change in securities purchased under agreements to resell | 827 | |
Purchases of securities available-for-sale | (70,478) | (6,200) |
Principal repayments on securities available-for-sale | 43,614 | 46,565 |
Redemption (purchase) of securities, restricted | 14 | (29) |
Purchases of premises and equipment | (942) | (446) |
Development of capitalized software | (1,325) | (1,325) |
Net cash used in investing activities | (122,648) | (32,701) |
Cash flows from financing activities: | ||
Net increase in deposits | 172,989 | 64,890 |
Decrease in borrowings | (1) | (2) |
Exercise of stock options | 21 | 290 |
Purchase of common stock | (567) | |
Net cash provided by financing activities | 173,009 | 64,611 |
Increase in cash and cash equivalents | 73,050 | 48,787 |
Cash and cash equivalents at beginning of the period | 65,185 | 61,806 |
Cash and cash equivalents at end of the period | 138,235 | 110,593 |
Cash paid during the period for: | ||
Interest | 597 | 990 |
Taxes | 5,854 | 4,330 |
Noncash transactions: | ||
Transfer from loans held for investment to held for sale | $ 14,584 | |
Right of use asset obtained in exchange for lease liability | 624 | |
Securities purchased but not yet settled | $ 3,337 |
Business and Summary of Signifi
Business and Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2021 | |
Business and Summary of Significant Accounting Policies | |
Business and Summary of Significant Accounting Policies | NOTE 1 — Basis of Presentation and Summary of Significant Accounting Policies Basis of Presentation The Interim Consolidated Financial Statements include the accounts of Esquire Financial Holdings, Inc. and its wholly owned subsidiary, Esquire Bank, N.A., are collectively referred to as “the Company.” All significant intercompany accounts and transactions have been eliminated in consolidation. The accompanying unaudited Interim Condensed Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles for interim financial information. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial information. In the opinion of management, the interim statements reflect all adjustments necessary for a fair presentation of the financial position, results of operations and cash flows of the Company on a consolidated basis and all such adjustments are recurring in nature. These financial statements and the accompanying notes should be read in conjunction with the Company’s audited financial statements for the years ended December 31, 2020 and 2019. Operating results for the three and nine months ended September 30, 2021 are not necessarily indicative of the results that may be expected for the year ending December 31, 2021 or any other period. Certain balances in the prior year financial statements were reclassified to conform to current presentation. The reclassifications had no effect on prior year net income or stockholders’ equity. Risks and Uncertainties On March 11, 2020, the World Health Organization declared COVID-19, the disease caused by the novel coronavirus, a pandemic as a result of the global spread of the coronavirus illness. In response to the outbreak, federal and state authorities in the U.S. introduced various measures to try to limit or slow the spread of the virus, including travel restrictions, nonessential business closures, stay-at-home orders, and strict social distancing. The full impact of COVID-19 is unknown and rapidly evolving. We have implemented a customer payment deferral program (principal and interest) to assist business borrowers and certain consumers that may be experiencing financial hardship due to COVID-19 related challenges. These loans will continue to accrue interest during the deferral period unless otherwise classified as nonperforming. Consistent with regulatory guidance and the provisions of the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”), borrowers that were otherwise current on loan payments that were granted COVID-19 related financial hardship payment deferrals will continue to be reported as current loans during the deferral period and not evaluated as to whether they are troubled debt restructurings (“TDR”). There were no delinquent loans upon adoption of our payment deferral program. At September 30, 2021, there were no participants in the customer payment deferral program. At this time, it is difficult to quantify the impact COVID-19 will have on future periods. This could cause the Company to experience a material adverse effect on our business operations, asset valuations, financial condition, and results of operations. Material adverse impacts may include all or a combination of an increase in the allowance for loan losses, valuation impairments on our investments or deferred tax assets. The Company has evaluated the impact of the effects of COVID-19 and determined that there were no material or systematic adverse impacts on the Company's third quarter 2021 Consolidated Statement of Financial Condition and Consolidated Statement of Income. Subsequent Events The Company has evaluated subsequent events for recognition and disclosure through the date of issuance. Loss Contingencies Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated. Management does not believe there now are such matters that will have a material effect on the Consolidated Financial Statements. Loans Held for Sale Loans transferred from investment to held for sale are accounted for at lower of cost or fair value. During the third quarter of 2021, the Company transferred its legacy NFL portfolio from loans held for investment to held for sale. As part of the transfer, the Company recorded a charge-off of $9.0 million, of which $3.0 million was provisioned for during the third quarter of 2021. Subsequent to the transfer, the Company recorded a lower of cost or fair value adjustment totaling $384 thousand, which is reflected as an unrealized loss on loans held for sale on the Consolidated Statement of Income. The carrying amount of these loans totaled $14.2 million and is included with Other assets on the Consolidated Statement of Financial Condition. New Accounting Pronouncements On June 16, 2016, the FASB issued Accounting Standards Update No. 2016-13, “Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (the ASU). This ASU replaces the incurred loss model with an expected loss model, referred to as “current expected credit loss” (CECL) model. It will significantly change estimates for credit losses related to financial assets measured at amortized cost, including loans receivable and certain other contracts. This ASU will be effective for the Company in fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company plans to adopt ASU 2016-13 on or before January 1, 2023, using the required modified retrospective method with a cumulative effect adjustment as of the beginning of the reporting period. The Company has gathered the necessary data and continues to prepare for the implementation of this standard. ASU 2020-04, “Reference Rate Reform (Topic 848)” (“ASU 2020-04”) provides optional expedients and exceptions for applying GAAP to loan and lease agreements, derivative contracts, and other transactions affected by the anticipated transition away from LIBOR toward new interest rate benchmarks. Subject to certain conditions, where an agreement, contract or transaction is modified in connection with the reference rate reform, the guidance permits: (i) modifications of loan agreements should be accounted for by prospectively adjusting the effective interest rate and the modification will be considered “minor” so that any existing unamortized origination fees/costs would carry forward and continue to be amortized and (ii) modifications of lease agreements should be accounted for as a continuation of the existing agreement with no reassessments of the lease classification and the discount rate or remeasurements of lease payments that otherwise would be required for modifications not accounted for as separate contracts. ASU 2020-04 also provides numerous optional expedients for derivative accounting and is effective March 12, 2020 through December 31, 2022. We do not expect ASU 2020-04 to have a material impact on the Company’s business operations and consolidated financial statements as our variable rate loan portfolios almost exclusively utilize the prime rate as the interest rate benchmark. Further, the Company does not have any derivative contracts or apply hedge accounting. |
Debt Securities
Debt Securities | 9 Months Ended |
Sep. 30, 2021 | |
Debt Securities | |
Debt Securities | NOTE 2 — Debt Securities Available-for-Sale Securities The amortized cost, gross unrealized gains and losses and estimated fair value of securities available-for-sale were as follows: Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value (In thousands) September 30, 2021 Mortgage-backed securities – agency $ 116,702 $ 868 $ (1,505) $ 116,065 Collateralized mortgage obligations (CMOs) – agency 25,235 413 (10) 25,638 Total available-for-sale $ 141,937 $ 1,281 $ (1,515) $ 141,703 December 31, 2020 Mortgage-backed securities – agency $ 55,212 $ 1,237 $ (49) $ 56,400 Collateralized mortgage obligations (CMOs) – agency 60,474 807 (26) 61,255 Total available-for-sale $ 115,686 $ 2,044 $ (75) $ 117,655 Mortgage-backed securities include all pass-through certificates guaranteed by FHLMC, FNMA, or GNMA and the CMOs are backed by government agency pass-through certificates. CMOs, by virtue of the underlying residential collateral or structure, are fixed rate current pay sequentials or planned amortization classes (PACs). As actual maturities may differ from contractual maturities because certain borrowers have the right to call or prepay certain obligations, these securities are not considered to have a single maturity date. There were no sales or calls of securities for the three and nine months ended September 30, 2021 and 2020. At September 30, 2021, securities having a fair value of $113.3 million were pledged to the Federal Home Loan Bank of New York (FHLB) for borrowing capacity totaling $107.7 million. At December 31, 2020, securities having a fair value of $98.6 million were pledged to the FHLB for borrowing capacity totaling $93.8 million. At September 30, 2021 and December 31, 2020, the Company had no outstanding FHLB advances. At September 30, 2021, securities having a fair value of $28.4 million were pledged to the Federal Reserve Bank of New York (FRB) for borrowing capacity totaling $27.5 million. At December 31, 2020, securities having a fair value of $19.1 million were pledged to the FRB for borrowing capacity totaling $18.7 million. At September 30, 2021 and December 31, 2020, the Company had no outstanding FRB borrowings. The following table provides the gross unrealized losses and fair value, aggregated by investment category and length of time the individual securities have been in a continuous unrealized loss position as of: Less Than 12 Months 12 Months or Longer Total Fair Gross Fair Gross Fair Gross (In thousands) September 30, 2021 Mortgage-backed securities – agency $ 90,392 $ (1,505) $ — $ — $ 90,392 $ (1,505) CMOs – agency 1,153 (10) — — 1,153 (10) Total temporarily impaired securities $ 91,545 $ (1,515) $ — $ — $ 91,545 $ (1,515) December 31, 2020 Mortgage-backed securities - agency $ 4,807 $ (49) $ — $ — $ 4,807 $ (49) CMOs - Agency 8,332 (17) 1,219 (9) 9,551 (26) Total temporarily impaired securities $ 13,139 $ (66) $ 1,219 $ (9) $ 14,358 $ (75) Management reviews the investment portfolio on a quarterly basis to determine the cause, magnitude and duration of declines in the fair value of each security. In estimating other-than-temporary impairment (OTTI), management considers many factors including: (1) the length of time and extent that fair value has been less than cost, (2) the financial condition and near term prospects of the issuer, (3) whether the market decline was affected by macroeconomic conditions, and (4) whether the Company has the intent to sell the security or more likely than not will be required to sell the security before its anticipated recovery. If either of the criteria regarding intent or requirement to sell is met, the entire difference between amortized cost and fair value is recognized as impairment through earnings. For debt securities that do not meet the aforementioned criteria, the amount of impairment is split into two components as follows: (1) OTTI related to credit loss, which must be recognized in the income statement and (2) OTTI related to other factors, which is recognized in other comprehensive income. The credit loss is defined as the difference between the present value of the cash flows expected to be collected and the amortized cost basis. The assessment of whether any other than temporary decline exists may involve a high degree of subjectivity and judgment and is based on the information available to management at a point in time. Management evaluates securities for OTTI at least on a quarterly basis, and more frequently when economic or market conditions warrant such an evaluation. At September 30, 2021, securities in unrealized loss positions were issuances from government sponsored entities. Due to the decline in fair value being attributable to changes in interest rates, not credit quality and because the Company does not have the intent to sell the securities and it is likely that it will not be required to sell the securities before their anticipated recovery, the Company does not consider the securities to be other-than-temporarily impaired at September 30, 2021. No impairment charges were recorded for the three and nine months ended September 30, 2021 and 2020. |
Loans
Loans | 9 Months Ended |
Sep. 30, 2021 | |
Loans | |
Loans | NOTE 3 — Loans The composition of loans by class is summarized as follows: At September 30, At December 31, 2021 2020 (Dollars in thousands) Real estate: 1 – 4 family $ 44,022 $ 48,433 Multifamily 240,055 169,817 Commercial real estate 53,437 54,717 Construction — — Total real estate 337,514 272,967 Commercial 398,511 358,410 Consumer 8,651 41,362 Total loans held for investment 744,676 672,739 Deferred loan fees and unearned premiums, net (584) (318) Allowance for loan losses (8,665) (11,402) Loans held for investment, net $ 735,427 $ 661,019 At September 30, 2021 and December 31, 2020, the commercial loans balance included Small Business Administration (“SBA”) Paycheck Protection Program (“PPP”) loans of $11.7 million and $21.9 million, respectively. The following tables present the activity in the allowance for loan losses by class for the three months ending September 30, 2021 and 2020: Commercial 1 ‑ 4 Family Commercial Multifamily Real Estate Construction Consumer Total (In thousands) September 30, 2021 Allowance for loan losses: Beginning balance $ 312 $ 5,547 $ 1,418 $ 603 $ — $ 6,137 $ 14,017 Provision (credit) for loan losses (3) 385 274 (4) — 3,098 3,750 Recoveries — — — — — — — Loans charged-off — — — — — (9,102) (9,102) Total ending allowance balance $ 309 $ 5,932 $ 1,692 $ 599 $ — $ 133 $ 8,665 September 30, 2020 Allowance for loan losses: Beginning balance $ 739 $ 4,816 $ 2,126 $ 982 $ — $ 2,013 $ 10,676 Provision (credit) for loan losses (247) 77 (502) (248) — 1,820 900 Recoveries — — — — — — — Loans charged-off — (2) — — — (17) (19) Total ending allowance balance $ 492 $ 4,891 $ 1,624 $ 734 $ — $ 3,816 $ 11,557 The following tables present the activity in the allowance for loan losses by class for the nine months ending September 30, 2021 and 2020: Commercial 1 ‑ 4 Family Commercial Multifamily Real Estate Construction Consumer Total (In thousands) September 30, 2021 Allowance for loan losses: Beginning balance $ 342 $ 5,003 $ 1,278 $ 597 $ — $ 4,182 $ 11,402 Provision (credit) for loan losses (33) 929 414 2 — 5,088 6,400 Recoveries — — — — — — — Loans charged-off — — — — — (9,137) (9,137) Total ending allowance balance $ 309 $ 5,932 $ 1,692 $ 599 $ — $ 133 $ 8,665 September 30, 2020 Allowance for loan losses: Beginning balance $ 344 $ 4,048 $ 1,048 $ 560 $ 161 $ 828 $ 6,989 Provision (credit) for loan losses 148 845 576 174 (161) 3,118 4,700 Recoveries — — — — — — — Loans charged-off — (2) — — — (130) (132) Total ending allowance balance $ 492 $ 4,891 $ 1,624 $ 734 $ — $ 3,816 $ 11,557 The following tables present the balance in the allowance for loan losses and the recorded investment in loans by class and based on impairment method as of September 30, 2021 and December 31, 2020: Commercial 1 ‑ 4 Family Commercial Multifamily Real Estate Construction Consumer Total (In thousands) September 30, 2021 Allowance for loan losses: Ending allowance balance attributable to loans: Individually evaluated for impairment $ — $ — $ — $ — $ — $ — $ — Collectively evaluated for impairment 309 5,932 1,692 599 — 133 8,665 Total ending allowance balance $ 309 $ 5,932 $ 1,692 $ 599 $ — $ 133 $ 8,665 Loans: Loans individually evaluated for impairment $ — $ — $ — $ — $ — $ — $ — Loans collectively evaluated for impairment 44,022 398,511 240,055 53,437 — 8,651 744,676 Total ending loans balance $ 44,022 $ 398,511 $ 240,055 $ 53,437 $ — $ 8,651 $ 744,676 Commercial 1 ‑ 4 Family Commercial Multifamily Real Estate Construction Consumer Total (In thousands) December 31, 2020 Allowance for loan losses: Ending allowance Balance attributable to loans: Individually evaluated for impairment $ — $ — $ — $ — $ — $ — $ — Collectively evaluated for impairment 342 5,003 1,278 597 — 4,182 11,402 Total ending allowance balance $ 342 $ 5,003 $ 1,278 $ 597 $ — $ 4,182 $ 11,402 Loans: Loans individually evaluated for impairment $ — $ — $ — $ — $ — $ 2,303 $ 2,303 Loans collectively evaluated for impairment 48,433 358,410 169,817 54,717 — 39,059 670,436 Total ending loans balance $ 48,433 $ 358,410 $ 169,817 $ 54,717 $ — $ 41,362 $ 672,739 Recorded investment is not adjusted for accrued interest, deferred fees and costs, and unearned premiums and discounts due to immateriality. The following table provides an analysis of the impaired loans by segment as of September 30, 2021 and December 31, 2020. There was no related allowance recorded on any impaired loans as of September 30, 2021 and December 31, 2020: September 30, December 31, 2021 2020 Unpaid Unpaid Recorded Principal Recorded Principal Investment Balance Investment Balance (In thousands) 1-4 family $ — $ — $ — $ — Commercial — — — — Multifamily — — — — Commercial real estate — — — — Construction — — — — Consumer — — 2,303 2,303 Total $ — $ — $ 2,303 $ 2,303 The following table provides an analysis of average recorded investment and interest income recognized by segment on impaired loans during the three and nine months ended September 30, 2021. For the three months ended September 30, For the nine months ended September 30, 2021 2020 2021 2020 Average Interest Average Interest Average Interest Average Interest Recorded Income Recorded Income Recorded Income Recorded Income Investment Recognized Investment Recognized Investment Recognized Investment Recognized (In thousands) 1-4 family $ — $ — $ — $ — $ — $ — $ — $ — Commercial — — — — — — — — Multifamily — — — — 144 — — — Commercial real estate — — — — — — — — Construction — — — — — — — — Consumer 1,703 — 1,436 — 2,054 — 1,210 — Total $ 1,703 $ — $ 1,436 $ — $ 2,198 $ — $ 1,210 $ — The following tables present the aging of the recorded investment in past due loans by class of loans as of September 30, 2021 and December 31, 2020: Total Past 30-59 60-89 Greater than Due & Days Days 90 Days Nonaccrual Nonaccrual Loans Not Past Due Past Due Past Due Loans Loans Past Due Total (In thousands) September 30, 2021 1 – 4 family $ — $ — $ — $ — $ — $ 44,022 $ 44,022 Commercial — — — — — 398,511 398,511 Multifamily — — — — — 240,055 240,055 Commercial real estate — — — — — 53,437 53,437 Construction — — — — — — — Consumer 8 14 — 12 34 8,617 8,651 Total $ 8 $ 14 $ — $ 12 $ 34 $ 744,642 $ 744,676 Total Past 30-59 60-89 Greater than Due & Days Days 90 Days Nonaccrual Nonaccrual Loans Not Past Due Past Due Past Due Loans Loans Past Due Total (In thousands) December 31, 2020 1 – 4 family $ — $ — $ — $ — $ — $ 48,433 $ 48,433 Commercial — — — — — 358,410 358,410 Multifamily — — — — — 169,817 169,817 Commercial real estate — — — — — 54,717 54,717 Construction — — — — — — — Consumer 26 — — 2,303 2,329 39,033 41,362 Total $ 26 $ — $ — $ 2,303 $ 2,329 $ 670,410 $ 672,739 Credit Quality Indicators The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Company analyzes loans individually by classifying the loans as to credit risk. This analysis is performed whenever a credit is extended, renewed or modified, or when an observable event occurs indicating a potential decline in credit quality, and no less than annually for large balance loans. The Company uses the following definitions for risk ratings: Special Mention Substandard Doubtful Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered to be pass rated loans. Based on the most recent analysis performed, the risk category of loans by class of loans is as follows: Pass Special Mention Substandard Doubtful (In thousands) September 30, 2021 1 – 4 family $ 41,007 $ 3,015 $ — $ — Commercial 376,482 17,977 4,052 — Multifamily 239,334 — 721 — Commercial real estate 49,619 3,818 — — Construction — — — — Consumer 8,651 — — — Total $ 715,093 $ 24,810 $ 4,773 $ — Pass Special Mention Substandard Doubtful (In thousands) December 31, 2020 1 – 4 family $ 45,418 $ 3,015 $ — $ — Commercial 358,295 — 115 — Multifamily 169,096 721 — — Commercial real estate 54,717 — — — Construction — — — — Consumer 34,896 4,163 2,303 — Total $ 662,422 $ 7,899 $ 2,418 $ — The Company considers the performance of the loan portfolio and its impact on the allowance for loan losses. For smaller dollar commercial and consumer loan classes, the Company evaluates credit quality based on the aging status of the loan, which was previously presented, and by payment activity. The Company has no loans identified as TDRs at September 30, 2021 and December 31, 2020. Furthermore, there were no loans modified during the three and nine months ended September 30, 2021 and 2020 as TDRs. In order to determine whether a borrower is experiencing financial difficulty, an evaluation is performed of the probability that the borrower will be in payment default on any of its debt in the foreseeable future without the modification. As discussed in Note 1, the Company implemented a payment deferral program in response to the COVID-19 crisis and elected to evaluate the modified loan population under the CARES Act which allows for troubled debt restructuring categorization to be suspended. As of September 30, 2021, there were no participants in the payment deferral program. Pledged Loans At September 30, 2021, loans totaling $36.4 million were pledged to the Federal Home Loan Bank of New York for borrowing capacity totaling $26.1 million. At December 31, 2020, loans totaling $37.5 million were pledged to the Federal Home Loan Bank of New York for borrowing capacity totaling $28.6 million. |
Noninterest Income
Noninterest Income | 9 Months Ended |
Sep. 30, 2021 | |
Noninterest Income. | |
Noninterest Income | NOTE 4 — Noninterest Income Descriptions of revenue-generating activities that are within the scope of Accounting Standards Codification (ASC) 606, Revenue from Contracts with Customers, and are presented in the Consolidated Statements of Income as components of noninterest income, are as follows: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2021 2020 2021 2020 (In thousands) Payment processing fees Payment processing income $ 5,021 $ 3,551 $ 15,339 $ 9,023 ACH income 206 170 609 504 Customer related fees and service charges Administrative service income — 41 29 140 Other 81 122 263 292 Unrealized loss on loans held for sale (1) (384) — (384) — Total noninterest income $ 4,924 $ 3,884 $ 15,856 $ 9,959 (1) Represents a valuation adjustment on loans held for sale, not within the scope of ASC 606. The Company has made no significant judgments in applying the revenue guidance prescribed in ASC 606 that affect the determination of the amount and timing of revenue from the above-described contracts with customers. ● Payment processing income – We provide payment processing services as an acquiring bank through the third-party or independent sales organization (ISO) business model in which we process credit and debit card transactions on behalf of merchants. We enter into a tri-party merchant agreement, between the Company, ISO and each merchant. The Company’s performance obligation is clearing and settling credit and debit transactions on behalf of the merchants. The Company recognizes revenue monthly once it summarizes and computes all revenue and expenses applicable to each ISO, which is our performance obligation. ● ACH income – We provide ACH services for merchants and other commercial customers. Contracts are entered into with third parties that require ACH transactions processed on behalf of their customers. Fees are variable and based on the volume of transactions within a given month. Our performance obligations are processing and settling ACHs on behalf of the customers. Our obligation is satisfied within each business day when the transactions (ACH files) are sent to the Federal Reserve Bank for clearing. Revenue is recognized based on the total volume of transactions processed that month for a given customer. ● Administrative service income – Administrative service income is derived primarily from the management of qualified settlement funds (QSFs), which are funds from settled mass torts and class action lawsuits. Our performance obligations with the QSFs are outlined in court approved orders which includes ensuring funds are invested into safe investment vehicles such as U.S. treasuries and FDIC insured products. Our fees for placing these funds in appropriate vehicles are earned over the course of a month, representing the period over which the Company satisfies the performance obligation. ● Other – The other category includes revenue from service charges on deposit accounts, debit card fees, and certain loan related fees where revenue is recognized as performance obligations are satisfied. |
Share-Based Payment Plans
Share-Based Payment Plans | 9 Months Ended |
Sep. 30, 2021 | |
Employee Benefits | |
Share-Based Payment Plans | NOTE 5 — Share-Based Payment Plans The Company issues incentive and nonqualified stock options and restricted stock awards to certain employees and directors pursuant to its equity incentive plans, which have been approved by the stockholders. Share-based awards are granted by the Compensation Committee of the Board of Directors. Under the plans, options are granted with an exercise price equal to the fair value of the Company’s stock at the date of the grant. Options granted vest over three four The fair value of each option award is estimated on the date of grant using a closed form option valuation (Black-Scholes) model that uses the assumptions noted in the table below. Expected volatilities are based on peer volatility. The Company uses peer data to estimate option exercise and post-vesting termination behavior. The expected term of options granted is based on peer data and represents the period of time that options granted are expected to be outstanding, which takes into account that the options are not transferable. The risk-free interest rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of the grant. There were no stock options granted during the three and nine months ended September 30, 2021 and 2020. The following table presents a summary of the activity related to options as of September 30, 2021: Weighted Weighted Average Average Remaining Exercise Contractual Options Price Life (Years) September 30, 2021 Outstanding at beginning of year 907,099 $ 14.11 Granted — — Exercised (113,121) 12.72 Forfeited (501) 23.08 Expired (415) 25.02 Outstanding at period end 793,062 $ 14.30 5.07 Vested or expected to vest 793,062 $ 14.30 5.07 Exercisable at period end 709,114 $ 13.43 4.63 The Company recognized compensation expense related to options of $117 thousand and $124 thousand for the three months ended September 30, 2021 and 2020, respectively. The Company recognized compensation expense related to options of $380 thousand and $387 thousand for the nine months ended September 30, 2021 and 2020, respectively. At September 30, 2021, unrecognized compensation cost related to nonvested options was approximately $562 thousand and is expected to be recognized over a weighted average period of 2.06 years. The intrinsic value for outstanding options and for options vested or expected to vest was $11.4 million and $10.8 million for exercisable options at September 30, 2021. Information related to stock option exercises during each period is as follows: For the three months ended For the nine months ended September 30, September 30, 2021 2020 2021 2020 (Dollars in thousands) Intrinsic value of options exercised $ 403 $ — $ 1,275 $ 878 Cash received from option exercises — — 21 290 Excess tax benefit from option exercises 78 — 244 77 The following table presents a summary of the activity related to restricted stock as of September 30, 2021: Weighted Average Grant Date Shares Fair Value September 30, 2021 Outstanding at beginning of year 380,750 $ 22.87 Granted — — Vested — — Outstanding at period end 380,750 $ 22.87 The Company recognized compensation expense related to restricted stock of $365 thousand and $259 thousand for the three months ended September 30, 2021 and 2020, respectively. The Company recognized compensation expense related to restricted stock of $1.1 million and $771 thousand for the nine months ended September 30, 2021 and 2020, respectively. As of September 30, 2021, there was $5.8 million of total unrecognized compensation cost related to nonvested shares granted under the plan. The cost is expected to be recognized over a weighted-average period of 4.25 years. |
Earnings per Share
Earnings per Share | 9 Months Ended |
Sep. 30, 2021 | |
Earnings per Common Share | |
Earnings per Common Share | NOTE 6 — Earnings per Share The factors used in the earnings per share computation follow: For the three months ended For the nine months ended September 30, September 30, 2021 2020 2021 2020 (Dollars in thousands, except per share data) Basic Net income $ 2,519 $ 3,606 $ 11,195 $ 8,736 Weighted average common shares outstanding 7,460,897 7,403,840 7,445,497 7,414,264 Basic earnings per share $ 0.34 $ 0.49 $ 1.50 $ 1.18 Diluted Net income $ 2,519 $ 3,606 $ 11,195 $ 8,736 Weighted average shares outstanding for basic earnings per share 7,460,897 7,403,840 7,445,497 7,414,264 Add: Dilutive effects of share based awards 487,145 172,124 448,076 225,103 Average shares and dilutive potential common shares 7,948,042 7,575,964 7,893,573 7,639,367 Diluted earnings per share $ 0.32 $ 0.48 $ 1.42 $ 1.14 Share-based awards totaling 107,600 and 303,250 shares of common stock were not considered in computing diluted earnings per common share for the three months ended September 30, 2021 and September 30, 2020, respectively, because they were anti-dilutive. Share-based awards totaling 107,600 and 303,250 shares of common stock were not considered in computing diluted earnings per common share for the nine months ended September 30, 2021 and September 30, 2020, respectively, because they were anti-dilutive. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2021 | |
Leases | |
Leases | NOTE 7 — Leases The Company recognizes the present value of its operating lease payments related to its office facilities and retail branch as operating lease assets and corresponding lease liabilities on the Consolidated Statements of Financial Condition. These operating lease assets represent the Company’s right to use an underlying asset for the lease term, and the lease liability represents the Company’s obligation to make lease payments over the lease term. As these leases do not provide an implicit rate, the Company used its incremental borrowing rate, the rate of interest to borrow on a collateralized basis for a similar term, at the lease commencement date in order to determine present value. Short-term lease payments, those leases with original terms of 12 months or less, are recognized in the Consolidated Statements of Income, on a straight-line basis over the lease term. Certain leases may include one or more options to renew. The exercise of lease renewal options is typically at the Company’s discretion and are included in the operating lease liability if it is reasonably certain that the renewal option will be exercised. Certain real estate leases may contain lease and non-lease components, such as common area maintenance charges, real estate taxes, and insurance, which are generally accounted for separately and are not included in the measurement of the lease liability since they are generally able to be segregated. The Company does not sublease any of its leased properties and does not lease properties from any related parties. As of September 30, 2021, right of use (“ROU”) lease assets liabilities assets liabilities Maturities of the Company’s operating lease liabilities at September 30, 2021 are as follows: Operating Lease Liabilities (In thousands) 2021 $ 163 2022 643 2023 636 2024 652 2025 668 Thereafter 627 Total operating lease payments $ 3,389 Less: interest 262 Present value of operating lease liabilities $ 3,127 As of September 30, 2021 2020 Weighted-average remaining lease term 5.12 years 6.08 years Weighted-average discount rate 3.05 % 3.05 % The components of total lease cost are as follows: For the three months ended For the nine months ended September 30, 2021 2020 2021 2020 (In thousands) Operating lease cost $ 142 $ 141 $ 425 $ 422 Short-term lease cost — 14 13 52 Total lease cost $ 142 $ 155 $ 438 $ 474 Cash paid for operating leases $ 161 $ 173 $ 503 $ 431 |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2021 | |
Fair Value Measurements | |
Fair Value Measurements | NOTE 8 — Fair Value Measurements Fair value is the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There are three levels of inputs that may be used to measure fair values. Level 1 Level 2 Level 3 For available-for-sale securities where quoted prices are not available, fair values are calculated based on market prices of similar securities (Level 2). Assets and liabilities measured at fair value on a recurring basis are summarized below: Fair Value Measurements Using Quoted Prices Significant Significant (Level 1) (Level 2) (Level 3) (In thousands) September 30, 2021 Assets Available-for-sale securities Mortgage-backed securities – agency $ — $ 116,065 $ — CMOs – agency — 25,638 — Total $ — $ 141,703 $ — December 31, 2020 Assets Available-for-sale securities Mortgage-backed securities – agency $ — $ 56,400 $ — CMOs – agency — 61,255 — Total $ — $ 117,655 $ — There were no transfers between Level 1 and Level 2 during the three and nine months ended September 30, 2021 and 2020. The legacy NFL consumer loan portfolio was measured on a nonrecurring basis and assigned a Level 3 fair value of $14.2 million as of September 30, 2021, as the loans are accounted for at the lower of cost or fair value. The fair value was determined using the discounted cash flow method under the income approach where the significant unobservable inputs include the cash flows and related timing, and an approximately 8% discount rate applied which reflects the rate of return market participants would expect to earn on investments of equivalent risk. The valuation adjustment recorded during the quarter totaled $384 thousand. There were no assets or liabilities measured at fair value on a nonrecurring basis as of December 31, 2020. The following tables present the carrying amounts and fair values (represents exit price) of financial instruments at September 30, 2021 and December 31, 2020: Fair Value Measurement at September 30, 2021, Using: Carrying Value (Level 1) (Level 2) (Level 3) Total (In thousands) Financial Assets: Cash and cash equivalents $ 138,235 $ 1,129 $ 137,106 $ — $ 138,235 Securities purchased under agreements to resell, at cost 50,899 — — 50,899 50,899 Securities available-for-sale 141,703 — 141,703 — 141,703 Securities, restricted, at cost 2,680 N/A N/A N/A N/A Loans held for investment, net 735,427 — — 735,232 735,232 Accrued interest receivable 4,462 — 280 4,182 4,462 Other assets - loans held for sale 14,200 — — 14,200 14,200 Financial Liabilities: Time deposits 11,125 — 11,163 — 11,163 Demand and other deposits 965,918 965,918 — — 965,918 Secured borrowings 48 — 48 — 48 Accrued interest payable — — — — — Fair Value Measurement at December 31, 2020, Using: Carrying Value (Level 1) (Level 2) (Level 3) Total (In thousands) Financial Assets: Cash and cash equivalents $ 65,185 $ 1,775 $ 63,410 $ — $ 65,185 Securities purchased under agreements to resell, at cost 51,726 — — 51,726 51,726 Securities available-for-sale 117,655 — 117,655 — 117,655 Securities, restricted, at cost 2,694 N/A N/A N/A N/A Loans held for investment, net 661,019 — — 661,992 661,992 Accrued interest receivable 4,529 — 245 4,284 4,529 Other assets - loans held for sale — — — — — Financial Liabilities: Time deposits 11,202 — 11,246 — 11,246 Demand and other deposits 792,852 792,852 — — 792,852 Secured borrowings 49 — 49 — 49 Accrued interest payable — — — — — |
Accumulated Other Comprehensive
Accumulated Other Comprehensive (Loss) Income | 9 Months Ended |
Sep. 30, 2021 | |
Accumulated Other Comprehensive (Loss) Income | |
Accumulated Other Comprehensive (Loss) Income | NOTE 9 — Accumulated Other Comprehensive (Loss) Income The following presents changes in accumulated other comprehensive (loss) income by component, net of tax, for the three and nine months ending September 30, 2021 and 2020: Three months ended Nine months ended September 30, 2021 2020 2021 2020 (In thousands) Unrealized (Losses) Gains on Available-for-Sale Securities Beginning balance $ 323 $ 1,899 $ 1,408 $ 386 Other comprehensive (loss) income before reclassifications, net of tax (490) (246) (1,575) 1,267 Amounts reclassified from accumulated other comprehensive income — — — — Net current period other comprehensive (loss) income (490) (246) (1,575) 1,267 Ending balance $ (167) $ 1,653 $ (167) $ 1,653 There were no reclassifications out of accumulated other comprehensive (loss) income for the three and nine months ended September 30, 2021 and 2020. |
Accounting Policy (Policies)
Accounting Policy (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Business and Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation The Interim Consolidated Financial Statements include the accounts of Esquire Financial Holdings, Inc. and its wholly owned subsidiary, Esquire Bank, N.A., are collectively referred to as “the Company.” All significant intercompany accounts and transactions have been eliminated in consolidation. The accompanying unaudited Interim Condensed Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles for interim financial information. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial information. In the opinion of management, the interim statements reflect all adjustments necessary for a fair presentation of the financial position, results of operations and cash flows of the Company on a consolidated basis and all such adjustments are recurring in nature. These financial statements and the accompanying notes should be read in conjunction with the Company’s audited financial statements for the years ended December 31, 2020 and 2019. Operating results for the three and nine months ended September 30, 2021 are not necessarily indicative of the results that may be expected for the year ending December 31, 2021 or any other period. Certain balances in the prior year financial statements were reclassified to conform to current presentation. The reclassifications had no effect on prior year net income or stockholders’ equity. |
Risks and Uncertainties | Risks and Uncertainties On March 11, 2020, the World Health Organization declared COVID-19, the disease caused by the novel coronavirus, a pandemic as a result of the global spread of the coronavirus illness. In response to the outbreak, federal and state authorities in the U.S. introduced various measures to try to limit or slow the spread of the virus, including travel restrictions, nonessential business closures, stay-at-home orders, and strict social distancing. The full impact of COVID-19 is unknown and rapidly evolving. We have implemented a customer payment deferral program (principal and interest) to assist business borrowers and certain consumers that may be experiencing financial hardship due to COVID-19 related challenges. These loans will continue to accrue interest during the deferral period unless otherwise classified as nonperforming. Consistent with regulatory guidance and the provisions of the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”), borrowers that were otherwise current on loan payments that were granted COVID-19 related financial hardship payment deferrals will continue to be reported as current loans during the deferral period and not evaluated as to whether they are troubled debt restructurings (“TDR”). There were no delinquent loans upon adoption of our payment deferral program. At September 30, 2021, there were no participants in the customer payment deferral program. At this time, it is difficult to quantify the impact COVID-19 will have on future periods. This could cause the Company to experience a material adverse effect on our business operations, asset valuations, financial condition, and results of operations. Material adverse impacts may include all or a combination of an increase in the allowance for loan losses, valuation impairments on our investments or deferred tax assets. The Company has evaluated the impact of the effects of COVID-19 and determined that there were no material or systematic adverse impacts on the Company's third quarter 2021 Consolidated Statement of Financial Condition and Consolidated Statement of Income. |
Subsequent Events | Subsequent Events The Company has evaluated subsequent events for recognition and disclosure through the date of issuance. |
Loss Contingencies | Loss Contingencies Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated. Management does not believe there now are such matters that will have a material effect on the Consolidated Financial Statements. |
Loans Held for Sale | Loans Held for Sale Loans transferred from investment to held for sale are accounted for at lower of cost or fair value. During the third quarter of 2021, the Company transferred its legacy NFL portfolio from loans held for investment to held for sale. As part of the transfer, the Company recorded a charge-off of $9.0 million, of which $3.0 million was provisioned for during the third quarter of 2021. Subsequent to the transfer, the Company recorded a lower of cost or fair value adjustment totaling $384 thousand, which is reflected as an unrealized loss on loans held for sale on the Consolidated Statement of Income. The carrying amount of these loans totaled $14.2 million and is included with Other assets on the Consolidated Statement of Financial Condition. |
New Accounting Pronouncements | New Accounting Pronouncements On June 16, 2016, the FASB issued Accounting Standards Update No. 2016-13, “Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (the ASU). This ASU replaces the incurred loss model with an expected loss model, referred to as “current expected credit loss” (CECL) model. It will significantly change estimates for credit losses related to financial assets measured at amortized cost, including loans receivable and certain other contracts. This ASU will be effective for the Company in fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company plans to adopt ASU 2016-13 on or before January 1, 2023, using the required modified retrospective method with a cumulative effect adjustment as of the beginning of the reporting period. The Company has gathered the necessary data and continues to prepare for the implementation of this standard. ASU 2020-04, “Reference Rate Reform (Topic 848)” (“ASU 2020-04”) provides optional expedients and exceptions for applying GAAP to loan and lease agreements, derivative contracts, and other transactions affected by the anticipated transition away from LIBOR toward new interest rate benchmarks. Subject to certain conditions, where an agreement, contract or transaction is modified in connection with the reference rate reform, the guidance permits: (i) modifications of loan agreements should be accounted for by prospectively adjusting the effective interest rate and the modification will be considered “minor” so that any existing unamortized origination fees/costs would carry forward and continue to be amortized and (ii) modifications of lease agreements should be accounted for as a continuation of the existing agreement with no reassessments of the lease classification and the discount rate or remeasurements of lease payments that otherwise would be required for modifications not accounted for as separate contracts. ASU 2020-04 also provides numerous optional expedients for derivative accounting and is effective March 12, 2020 through December 31, 2022. We do not expect ASU 2020-04 to have a material impact on the Company’s business operations and consolidated financial statements as our variable rate loan portfolios almost exclusively utilize the prime rate as the interest rate benchmark. Further, the Company does not have any derivative contracts or apply hedge accounting. |
Debt Securities (Tables)
Debt Securities (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Debt Securities | |
Schedule of amortized cost, gross unrealized gains and losses and estimated fair value of securities available-for-sale | Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value (In thousands) September 30, 2021 Mortgage-backed securities – agency $ 116,702 $ 868 $ (1,505) $ 116,065 Collateralized mortgage obligations (CMOs) – agency 25,235 413 (10) 25,638 Total available-for-sale $ 141,937 $ 1,281 $ (1,515) $ 141,703 December 31, 2020 Mortgage-backed securities – agency $ 55,212 $ 1,237 $ (49) $ 56,400 Collateralized mortgage obligations (CMOs) – agency 60,474 807 (26) 61,255 Total available-for-sale $ 115,686 $ 2,044 $ (75) $ 117,655 |
Schedule of gross unrealized losses and fair value, securities in continuous unrealized loss position | Less Than 12 Months 12 Months or Longer Total Fair Gross Fair Gross Fair Gross (In thousands) September 30, 2021 Mortgage-backed securities – agency $ 90,392 $ (1,505) $ — $ — $ 90,392 $ (1,505) CMOs – agency 1,153 (10) — — 1,153 (10) Total temporarily impaired securities $ 91,545 $ (1,515) $ — $ — $ 91,545 $ (1,515) December 31, 2020 Mortgage-backed securities - agency $ 4,807 $ (49) $ — $ — $ 4,807 $ (49) CMOs - Agency 8,332 (17) 1,219 (9) 9,551 (26) Total temporarily impaired securities $ 13,139 $ (66) $ 1,219 $ (9) $ 14,358 $ (75) |
Loans (Tables)
Loans (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Loans | |
Schedule of composition of loans | At September 30, At December 31, 2021 2020 (Dollars in thousands) Real estate: 1 – 4 family $ 44,022 $ 48,433 Multifamily 240,055 169,817 Commercial real estate 53,437 54,717 Construction — — Total real estate 337,514 272,967 Commercial 398,511 358,410 Consumer 8,651 41,362 Total loans held for investment 744,676 672,739 Deferred loan fees and unearned premiums, net (584) (318) Allowance for loan losses (8,665) (11,402) Loans held for investment, net $ 735,427 $ 661,019 |
Schedule of activity in allowance for loan losses | The following tables present the activity in the allowance for loan losses by class for the three months ending September 30, 2021 and 2020: Commercial 1 ‑ 4 Family Commercial Multifamily Real Estate Construction Consumer Total (In thousands) September 30, 2021 Allowance for loan losses: Beginning balance $ 312 $ 5,547 $ 1,418 $ 603 $ — $ 6,137 $ 14,017 Provision (credit) for loan losses (3) 385 274 (4) — 3,098 3,750 Recoveries — — — — — — — Loans charged-off — — — — — (9,102) (9,102) Total ending allowance balance $ 309 $ 5,932 $ 1,692 $ 599 $ — $ 133 $ 8,665 September 30, 2020 Allowance for loan losses: Beginning balance $ 739 $ 4,816 $ 2,126 $ 982 $ — $ 2,013 $ 10,676 Provision (credit) for loan losses (247) 77 (502) (248) — 1,820 900 Recoveries — — — — — — — Loans charged-off — (2) — — — (17) (19) Total ending allowance balance $ 492 $ 4,891 $ 1,624 $ 734 $ — $ 3,816 $ 11,557 The following tables present the activity in the allowance for loan losses by class for the nine months ending September 30, 2021 and 2020: Commercial 1 ‑ 4 Family Commercial Multifamily Real Estate Construction Consumer Total (In thousands) September 30, 2021 Allowance for loan losses: Beginning balance $ 342 $ 5,003 $ 1,278 $ 597 $ — $ 4,182 $ 11,402 Provision (credit) for loan losses (33) 929 414 2 — 5,088 6,400 Recoveries — — — — — — — Loans charged-off — — — — — (9,137) (9,137) Total ending allowance balance $ 309 $ 5,932 $ 1,692 $ 599 $ — $ 133 $ 8,665 September 30, 2020 Allowance for loan losses: Beginning balance $ 344 $ 4,048 $ 1,048 $ 560 $ 161 $ 828 $ 6,989 Provision (credit) for loan losses 148 845 576 174 (161) 3,118 4,700 Recoveries — — — — — — — Loans charged-off — (2) — — — (130) (132) Total ending allowance balance $ 492 $ 4,891 $ 1,624 $ 734 $ — $ 3,816 $ 11,557 The following tables present the balance in the allowance for loan losses and the recorded investment in loans by class and based on impairment method as of September 30, 2021 and December 31, 2020: Commercial 1 ‑ 4 Family Commercial Multifamily Real Estate Construction Consumer Total (In thousands) September 30, 2021 Allowance for loan losses: Ending allowance balance attributable to loans: Individually evaluated for impairment $ — $ — $ — $ — $ — $ — $ — Collectively evaluated for impairment 309 5,932 1,692 599 — 133 8,665 Total ending allowance balance $ 309 $ 5,932 $ 1,692 $ 599 $ — $ 133 $ 8,665 Loans: Loans individually evaluated for impairment $ — $ — $ — $ — $ — $ — $ — Loans collectively evaluated for impairment 44,022 398,511 240,055 53,437 — 8,651 744,676 Total ending loans balance $ 44,022 $ 398,511 $ 240,055 $ 53,437 $ — $ 8,651 $ 744,676 Commercial 1 ‑ 4 Family Commercial Multifamily Real Estate Construction Consumer Total (In thousands) December 31, 2020 Allowance for loan losses: Ending allowance Balance attributable to loans: Individually evaluated for impairment $ — $ — $ — $ — $ — $ — $ — Collectively evaluated for impairment 342 5,003 1,278 597 — 4,182 11,402 Total ending allowance balance $ 342 $ 5,003 $ 1,278 $ 597 $ — $ 4,182 $ 11,402 Loans: Loans individually evaluated for impairment $ — $ — $ — $ — $ — $ 2,303 $ 2,303 Loans collectively evaluated for impairment 48,433 358,410 169,817 54,717 — 39,059 670,436 Total ending loans balance $ 48,433 $ 358,410 $ 169,817 $ 54,717 $ — $ 41,362 $ 672,739 |
Schedule of impaired loans | September 30, December 31, 2021 2020 Unpaid Unpaid Recorded Principal Recorded Principal Investment Balance Investment Balance (In thousands) 1-4 family $ — $ — $ — $ — Commercial — — — — Multifamily — — — — Commercial real estate — — — — Construction — — — — Consumer — — 2,303 2,303 Total $ — $ — $ 2,303 $ 2,303 The following table provides an analysis of average recorded investment and interest income recognized by segment on impaired loans during the three and nine months ended September 30, 2021. For the three months ended September 30, For the nine months ended September 30, 2021 2020 2021 2020 Average Interest Average Interest Average Interest Average Interest Recorded Income Recorded Income Recorded Income Recorded Income Investment Recognized Investment Recognized Investment Recognized Investment Recognized (In thousands) 1-4 family $ — $ — $ — $ — $ — $ — $ — $ — Commercial — — — — — — — — Multifamily — — — — 144 — — — Commercial real estate — — — — — — — — Construction — — — — — — — — Consumer 1,703 — 1,436 — 2,054 — 1,210 — Total $ 1,703 $ — $ 1,436 $ — $ 2,198 $ — $ 1,210 $ — |
Schedule of aging of recorded investment in past due loans | Total Past 30-59 60-89 Greater than Due & Days Days 90 Days Nonaccrual Nonaccrual Loans Not Past Due Past Due Past Due Loans Loans Past Due Total (In thousands) September 30, 2021 1 – 4 family $ — $ — $ — $ — $ — $ 44,022 $ 44,022 Commercial — — — — — 398,511 398,511 Multifamily — — — — — 240,055 240,055 Commercial real estate — — — — — 53,437 53,437 Construction — — — — — — — Consumer 8 14 — 12 34 8,617 8,651 Total $ 8 $ 14 $ — $ 12 $ 34 $ 744,642 $ 744,676 Total Past 30-59 60-89 Greater than Due & Days Days 90 Days Nonaccrual Nonaccrual Loans Not Past Due Past Due Past Due Loans Loans Past Due Total (In thousands) December 31, 2020 1 – 4 family $ — $ — $ — $ — $ — $ 48,433 $ 48,433 Commercial — — — — — 358,410 358,410 Multifamily — — — — — 169,817 169,817 Commercial real estate — — — — — 54,717 54,717 Construction — — — — — — — Consumer 26 — — 2,303 2,329 39,033 41,362 Total $ 26 $ — $ — $ 2,303 $ 2,329 $ 670,410 $ 672,739 |
Schedule of risk category of loans | Pass Special Mention Substandard Doubtful (In thousands) September 30, 2021 1 – 4 family $ 41,007 $ 3,015 $ — $ — Commercial 376,482 17,977 4,052 — Multifamily 239,334 — 721 — Commercial real estate 49,619 3,818 — — Construction — — — — Consumer 8,651 — — — Total $ 715,093 $ 24,810 $ 4,773 $ — Pass Special Mention Substandard Doubtful (In thousands) December 31, 2020 1 – 4 family $ 45,418 $ 3,015 $ — $ — Commercial 358,295 — 115 — Multifamily 169,096 721 — — Commercial real estate 54,717 — — — Construction — — — — Consumer 34,896 4,163 2,303 — Total $ 662,422 $ 7,899 $ 2,418 $ — |
Noninterest Income (Tables)
Noninterest Income (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Noninterest Income. | |
Schedule of Consolidated of Income as components of noninterest income | For the Three Months Ended September 30, For the Nine Months Ended September 30, 2021 2020 2021 2020 (In thousands) Payment processing fees Payment processing income $ 5,021 $ 3,551 $ 15,339 $ 9,023 ACH income 206 170 609 504 Customer related fees and service charges Administrative service income — 41 29 140 Other 81 122 263 292 Unrealized loss on loans held for sale (1) (384) — (384) — Total noninterest income $ 4,924 $ 3,884 $ 15,856 $ 9,959 (1) Represents a valuation adjustment on loans held for sale, not within the scope of ASC 606. |
Share-Based Payment Plans (Tabl
Share-Based Payment Plans (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Employee Benefits | |
Schedule of option activity | Weighted Weighted Average Average Remaining Exercise Contractual Options Price Life (Years) September 30, 2021 Outstanding at beginning of year 907,099 $ 14.11 Granted — — Exercised (113,121) 12.72 Forfeited (501) 23.08 Expired (415) 25.02 Outstanding at period end 793,062 $ 14.30 5.07 Vested or expected to vest 793,062 $ 14.30 5.07 Exercisable at period end 709,114 $ 13.43 4.63 |
Schedule of information related to stock option exercises | For the three months ended For the nine months ended September 30, September 30, 2021 2020 2021 2020 (Dollars in thousands) Intrinsic value of options exercised $ 403 $ — $ 1,275 $ 878 Cash received from option exercises — — 21 290 Excess tax benefit from option exercises 78 — 244 77 |
Schedule of activity related to restricted stock | Weighted Average Grant Date Shares Fair Value September 30, 2021 Outstanding at beginning of year 380,750 $ 22.87 Granted — — Vested — — Outstanding at period end 380,750 $ 22.87 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Earnings per Common Share | |
Schedule of earnings per share | For the three months ended For the nine months ended September 30, September 30, 2021 2020 2021 2020 (Dollars in thousands, except per share data) Basic Net income $ 2,519 $ 3,606 $ 11,195 $ 8,736 Weighted average common shares outstanding 7,460,897 7,403,840 7,445,497 7,414,264 Basic earnings per share $ 0.34 $ 0.49 $ 1.50 $ 1.18 Diluted Net income $ 2,519 $ 3,606 $ 11,195 $ 8,736 Weighted average shares outstanding for basic earnings per share 7,460,897 7,403,840 7,445,497 7,414,264 Add: Dilutive effects of share based awards 487,145 172,124 448,076 225,103 Average shares and dilutive potential common shares 7,948,042 7,575,964 7,893,573 7,639,367 Diluted earnings per share $ 0.32 $ 0.48 $ 1.42 $ 1.14 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Leases | |
Schedule of maturities of operating lease liabilities | Operating Lease Liabilities (In thousands) 2021 $ 163 2022 643 2023 636 2024 652 2025 668 Thereafter 627 Total operating lease payments $ 3,389 Less: interest 262 Present value of operating lease liabilities $ 3,127 |
Schedule of lease assumptions | As of September 30, 2021 2020 Weighted-average remaining lease term 5.12 years 6.08 years Weighted-average discount rate 3.05 % 3.05 % |
Schedule of lease cost | For the three months ended For the nine months ended September 30, 2021 2020 2021 2020 (In thousands) Operating lease cost $ 142 $ 141 $ 425 $ 422 Short-term lease cost — 14 13 52 Total lease cost $ 142 $ 155 $ 438 $ 474 Cash paid for operating leases $ 161 $ 173 $ 503 $ 431 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Fair Value Measurements | |
Schedule of assets measured at fair value on a recurring basis | Fair Value Measurements Using Quoted Prices Significant Significant (Level 1) (Level 2) (Level 3) (In thousands) September 30, 2021 Assets Available-for-sale securities Mortgage-backed securities – agency $ — $ 116,065 $ — CMOs – agency — 25,638 — Total $ — $ 141,703 $ — December 31, 2020 Assets Available-for-sale securities Mortgage-backed securities – agency $ — $ 56,400 $ — CMOs – agency — 61,255 — Total $ — $ 117,655 $ — |
Schedule of carrying amounts and fair values of financial instruments | Fair Value Measurement at September 30, 2021, Using: Carrying Value (Level 1) (Level 2) (Level 3) Total (In thousands) Financial Assets: Cash and cash equivalents $ 138,235 $ 1,129 $ 137,106 $ — $ 138,235 Securities purchased under agreements to resell, at cost 50,899 — — 50,899 50,899 Securities available-for-sale 141,703 — 141,703 — 141,703 Securities, restricted, at cost 2,680 N/A N/A N/A N/A Loans held for investment, net 735,427 — — 735,232 735,232 Accrued interest receivable 4,462 — 280 4,182 4,462 Other assets - loans held for sale 14,200 — — 14,200 14,200 Financial Liabilities: Time deposits 11,125 — 11,163 — 11,163 Demand and other deposits 965,918 965,918 — — 965,918 Secured borrowings 48 — 48 — 48 Accrued interest payable — — — — — Fair Value Measurement at December 31, 2020, Using: Carrying Value (Level 1) (Level 2) (Level 3) Total (In thousands) Financial Assets: Cash and cash equivalents $ 65,185 $ 1,775 $ 63,410 $ — $ 65,185 Securities purchased under agreements to resell, at cost 51,726 — — 51,726 51,726 Securities available-for-sale 117,655 — 117,655 — 117,655 Securities, restricted, at cost 2,694 N/A N/A N/A N/A Loans held for investment, net 661,019 — — 661,992 661,992 Accrued interest receivable 4,529 — 245 4,284 4,529 Other assets - loans held for sale — — — — — Financial Liabilities: Time deposits 11,202 — 11,246 — 11,246 Demand and other deposits 792,852 792,852 — — 792,852 Secured borrowings 49 — 49 — 49 Accrued interest payable — — — — — |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive (Loss) Income (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Accumulated Other Comprehensive (Loss) Income | |
Schedule of changes in accumulated other comprehensive (loss) income by component, net of tax | Three months ended Nine months ended September 30, 2021 2020 2021 2020 (In thousands) Unrealized (Losses) Gains on Available-for-Sale Securities Beginning balance $ 323 $ 1,899 $ 1,408 $ 386 Other comprehensive (loss) income before reclassifications, net of tax (490) (246) (1,575) 1,267 Amounts reclassified from accumulated other comprehensive income — — — — Net current period other comprehensive (loss) income (490) (246) (1,575) 1,267 Ending balance $ (167) $ 1,653 $ (167) $ 1,653 |
Business and Summary of Signi_2
Business and Summary of Significant Accounting Policies (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021USD ($)item | Sep. 30, 2020USD ($) | Sep. 30, 2021USD ($)item | Sep. 30, 2020USD ($) | |
Accounting Policies [Line Items] | ||||
Loan carrying amount | $ 14,200 | $ 14,200 | ||
Loans charged-off | 9,102 | $ 19 | 9,137 | $ 132 |
Provision for loan | 3,750 | $ 900 | 6,400 | $ 4,700 |
Fair value adjustment | $ (384) | $ (384) | ||
Payment deferral program | Covid 19 | ||||
Accounting Policies [Line Items] | ||||
Number of delinquent loans | item | 0 | 0 | ||
NFL Portfolio | ||||
Accounting Policies [Line Items] | ||||
Loans charged-off | $ 9,000 | |||
Provision for loan | $ 3,000 |
Debt Securities - Summary of re
Debt Securities - Summary of reconciliation of amortized cost to fair value (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | $ 141,937 | $ 115,686 |
Gross Unrealized Gains | 1,281 | 2,044 |
Gross Unrealized Losses | (1,515) | (75) |
Fair Value | 141,703 | 117,655 |
Mortgage-backed securities - agency | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 116,702 | 55,212 |
Gross Unrealized Gains | 868 | 1,237 |
Gross Unrealized Losses | (1,505) | (49) |
Fair Value | 116,065 | 56,400 |
CMO's - agency | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 25,235 | 60,474 |
Gross Unrealized Gains | 413 | 807 |
Gross Unrealized Losses | (10) | (26) |
Fair Value | $ 25,638 | $ 61,255 |
Debt Securities - Summary of am
Debt Securities - Summary of amortized cost and fair value of debt securities by contractual maturity (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Debt Securities | ||||
Sales or calls of securities | $ 0 | $ 0 | $ 0 | $ 0 |
Debt Securities - Summary of se
Debt Securities - Summary of securities in unrealized loss position (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value, Less than 12 Months | $ 91,545 | $ 13,139 |
Gross Unrealized Losses, Less than 12 Months | (1,515) | (66) |
Fair Value, 12 Months or Longer | 1,219 | |
Gross Unrealized Losses, 12 Months or Longer | (9) | |
Fair Value, Total | 91,545 | 14,358 |
Gross Unrealized Losses, Total | (1,515) | (75) |
Mortgage-backed securities - agency | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value, Less than 12 Months | 90,392 | 4,807 |
Gross Unrealized Losses, Less than 12 Months | (1,505) | (49) |
Fair Value, Total | 90,392 | 4,807 |
Gross Unrealized Losses, Total | (1,505) | (49) |
CMO's - agency | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value, Less than 12 Months | 1,153 | 8,332 |
Gross Unrealized Losses, Less than 12 Months | (10) | (17) |
Fair Value, 12 Months or Longer | 1,219 | |
Gross Unrealized Losses, 12 Months or Longer | (9) | |
Fair Value, Total | 1,153 | 9,551 |
Gross Unrealized Losses, Total | $ (10) | $ (26) |
Debt Securities - Additional di
Debt Securities - Additional disclosures (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Debt Securities, Available-for-sale [Line Items] | |||||
Fair value of pledged securities | $ 2,680 | $ 2,680 | $ 2,694 | ||
Impairment charges | 0 | $ 0 | 0 | $ 0 | |
Federal Home Loan Bank Advances | |||||
Debt Securities, Available-for-sale [Line Items] | |||||
Short-term debt | 0 | 0 | 0 | ||
Federal Reserve Bank Advances | |||||
Debt Securities, Available-for-sale [Line Items] | |||||
Short-term debt | 0 | 0 | 0 | ||
Federal Reserve Bank of New York (FRB) | |||||
Debt Securities, Available-for-sale [Line Items] | |||||
Fair value of pledged securities | 28,400 | 28,400 | 19,100 | ||
Securities pledged borrowed amount | 27,500 | 27,500 | 18,700 | ||
Federal Home Loan Bank of New York (FHLB) | |||||
Debt Securities, Available-for-sale [Line Items] | |||||
Fair value of pledged securities | 113,300 | 113,300 | 98,600 | ||
Securities pledged borrowed amount | $ 107,700 | $ 107,700 | $ 93,800 |
Loans - Summary of loan composi
Loans - Summary of loan composition (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Jun. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Dec. 31, 2019 |
Loans and Leases Receivable Disclosure [Line Items] | ||||||
Total loans held for investment | $ 744,676 | $ 672,739 | ||||
Deferred costs and unearned premiums, net | (584) | (318) | ||||
Allowance for loan losses | (8,665) | $ (14,017) | (11,402) | $ (11,557) | $ (10,676) | $ (6,989) |
Loans held for investment, net | 735,427 | 661,019 | ||||
Real Estate | ||||||
Loans and Leases Receivable Disclosure [Line Items] | ||||||
Total loans held for investment | 337,514 | 272,967 | ||||
Real Estate | 1 - 4 Family Residential | ||||||
Loans and Leases Receivable Disclosure [Line Items] | ||||||
Total loans held for investment | 44,022 | 48,433 | ||||
Allowance for loan losses | (309) | (312) | (342) | (492) | (739) | (344) |
Real Estate | Multifamily | ||||||
Loans and Leases Receivable Disclosure [Line Items] | ||||||
Total loans held for investment | 240,055 | 169,817 | ||||
Allowance for loan losses | (1,692) | (1,418) | (1,278) | (1,624) | (2,126) | (1,048) |
Real Estate | Commercial Real Estate | ||||||
Loans and Leases Receivable Disclosure [Line Items] | ||||||
Total loans held for investment | 53,437 | 54,717 | ||||
Allowance for loan losses | (599) | (603) | (597) | (734) | (982) | (560) |
Real Estate | Construction | ||||||
Loans and Leases Receivable Disclosure [Line Items] | ||||||
Allowance for loan losses | (161) | |||||
Commercial | ||||||
Loans and Leases Receivable Disclosure [Line Items] | ||||||
Total loans held for investment | 398,511 | 358,410 | ||||
Allowance for loan losses | (5,932) | (5,547) | (5,003) | (4,891) | (4,816) | (4,048) |
Commercial | SBA paycheck protection program loans | ||||||
Loans and Leases Receivable Disclosure [Line Items] | ||||||
Total loans held for investment | 11,700 | 21,900 | ||||
Consumer | ||||||
Loans and Leases Receivable Disclosure [Line Items] | ||||||
Total loans held for investment | 8,651 | 41,362 | ||||
Allowance for loan losses | $ (133) | $ (6,137) | $ (4,182) | $ (3,816) | $ (2,013) | $ (828) |
Loans - Summary of activity in
Loans - Summary of activity in allowance for loan losses by class (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Allowance for loan losses: | ||||
Beginning balance | $ 14,017 | $ 10,676 | $ 11,402 | $ 6,989 |
Provision (credit) for loan losses | 3,750 | 900 | 6,400 | 4,700 |
Recoveries | 0 | 0 | ||
Loans charged-off | (9,102) | (19) | (9,137) | (132) |
Total ending allowance balance | 8,665 | 11,557 | 8,665 | 11,557 |
Real Estate | 1 - 4 Family Residential | ||||
Allowance for loan losses: | ||||
Beginning balance | 312 | 739 | 342 | 344 |
Provision (credit) for loan losses | (3) | (247) | (33) | 148 |
Recoveries | 0 | 0 | ||
Loans charged-off | 0 | 0 | ||
Total ending allowance balance | 309 | 492 | 309 | 492 |
Real Estate | Multifamily | ||||
Allowance for loan losses: | ||||
Beginning balance | 1,418 | 2,126 | 1,278 | 1,048 |
Provision (credit) for loan losses | 274 | (502) | 414 | 576 |
Recoveries | 0 | 0 | ||
Loans charged-off | 0 | 0 | ||
Total ending allowance balance | 1,692 | 1,624 | 1,692 | 1,624 |
Real Estate | Commercial Real Estate | ||||
Allowance for loan losses: | ||||
Beginning balance | 603 | 982 | 597 | 560 |
Provision (credit) for loan losses | (4) | (248) | 2 | 174 |
Recoveries | 0 | 0 | ||
Loans charged-off | 0 | 0 | ||
Total ending allowance balance | 599 | 734 | 599 | 734 |
Real Estate | Construction | ||||
Allowance for loan losses: | ||||
Beginning balance | 161 | |||
Provision (credit) for loan losses | (161) | |||
Recoveries | 0 | 0 | ||
Loans charged-off | 0 | 0 | ||
Commercial | ||||
Allowance for loan losses: | ||||
Beginning balance | 5,547 | 4,816 | 5,003 | 4,048 |
Provision (credit) for loan losses | 385 | 77 | 929 | 845 |
Recoveries | 0 | 0 | ||
Loans charged-off | 0 | (2) | (2) | |
Total ending allowance balance | 5,932 | 4,891 | 5,932 | 4,891 |
Consumer | ||||
Allowance for loan losses: | ||||
Beginning balance | 6,137 | 2,013 | 4,182 | 828 |
Provision (credit) for loan losses | 3,098 | 1,820 | 5,088 | 3,118 |
Recoveries | 0 | 0 | ||
Loans charged-off | (9,102) | (17) | (9,137) | (130) |
Total ending allowance balance | $ 133 | $ 3,816 | $ 133 | $ 3,816 |
Loans - Summary of balance in a
Loans - Summary of balance in allowance for loan losses and recorded investment in loans by class and based on impairment method (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Jun. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Dec. 31, 2019 |
Ending allowance balance attributable to loans: | ||||||
Individually evaluated for impairment | $ 0 | |||||
Collectively evaluated for impairment | 8,665 | $ 11,402 | ||||
Total ending allowance balance | 8,665 | $ 14,017 | 11,402 | $ 11,557 | $ 10,676 | $ 6,989 |
Loans: | ||||||
Loans individually evaluated for impairment | 0 | 2,303 | ||||
Loans collectively evaluated for impairment | 744,676 | 670,436 | ||||
Total ending loans balance | 744,676 | 672,739 | ||||
Real Estate | ||||||
Loans: | ||||||
Total ending loans balance | 337,514 | 272,967 | ||||
Real Estate | 1 - 4 Family Residential | ||||||
Ending allowance balance attributable to loans: | ||||||
Individually evaluated for impairment | 0 | |||||
Collectively evaluated for impairment | 309 | 342 | ||||
Total ending allowance balance | 309 | 312 | 342 | 492 | 739 | 344 |
Loans: | ||||||
Loans individually evaluated for impairment | 0 | |||||
Loans collectively evaluated for impairment | 44,022 | 48,433 | ||||
Total ending loans balance | 44,022 | 48,433 | ||||
Real Estate | Multifamily | ||||||
Ending allowance balance attributable to loans: | ||||||
Individually evaluated for impairment | 0 | |||||
Collectively evaluated for impairment | 1,692 | 1,278 | ||||
Total ending allowance balance | 1,692 | 1,418 | 1,278 | 1,624 | 2,126 | 1,048 |
Loans: | ||||||
Loans individually evaluated for impairment | 0 | |||||
Loans collectively evaluated for impairment | 240,055 | 169,817 | ||||
Total ending loans balance | 240,055 | 169,817 | ||||
Real Estate | Commercial Real Estate | ||||||
Ending allowance balance attributable to loans: | ||||||
Individually evaluated for impairment | 0 | |||||
Collectively evaluated for impairment | 599 | 597 | ||||
Total ending allowance balance | 599 | 603 | 597 | 734 | 982 | 560 |
Loans: | ||||||
Loans individually evaluated for impairment | 0 | |||||
Loans collectively evaluated for impairment | 53,437 | 54,717 | ||||
Total ending loans balance | 53,437 | 54,717 | ||||
Real Estate | Construction | ||||||
Ending allowance balance attributable to loans: | ||||||
Individually evaluated for impairment | 0 | |||||
Total ending allowance balance | 161 | |||||
Loans: | ||||||
Loans individually evaluated for impairment | 0 | |||||
Commercial | ||||||
Ending allowance balance attributable to loans: | ||||||
Individually evaluated for impairment | 0 | |||||
Collectively evaluated for impairment | 5,932 | 5,003 | ||||
Total ending allowance balance | 5,932 | 5,547 | 5,003 | 4,891 | 4,816 | 4,048 |
Loans: | ||||||
Loans individually evaluated for impairment | 0 | |||||
Loans collectively evaluated for impairment | 398,511 | 358,410 | ||||
Total ending loans balance | 398,511 | 358,410 | ||||
Consumer | ||||||
Ending allowance balance attributable to loans: | ||||||
Individually evaluated for impairment | 0 | |||||
Collectively evaluated for impairment | 133 | 4,182 | ||||
Total ending allowance balance | 133 | $ 6,137 | 4,182 | $ 3,816 | $ 2,013 | $ 828 |
Loans: | ||||||
Loans individually evaluated for impairment | 0 | 2,303 | ||||
Loans collectively evaluated for impairment | 8,651 | 39,059 | ||||
Total ending loans balance | $ 8,651 | $ 41,362 |
Loans - Summary of impaired loa
Loans - Summary of impaired loans by segment (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Financing Receivable, Impaired [Line Items] | |||||
Allowance recorded on impaired loans | $ 0 | $ 0 | $ 0 | ||
Recorded Investment | 2,303 | ||||
Unpaid Principal Balance | 2,303 | ||||
Average Recorded Investment | 1,703 | $ 1,436 | 2,198 | $ 1,210 | |
Multifamily | |||||
Financing Receivable, Impaired [Line Items] | |||||
Average Recorded Investment | 144 | ||||
Consumer | |||||
Financing Receivable, Impaired [Line Items] | |||||
Average Recorded Investment | $ 1,703 | $ 1,436 | $ 2,054 | $ 1,210 | |
Consumer | |||||
Financing Receivable, Impaired [Line Items] | |||||
Recorded Investment | 2,303 | ||||
Unpaid Principal Balance | $ 2,303 |
Loans - Summary of loans by pas
Loans - Summary of loans by past due status (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Nonaccrual Loans | $ 12 | $ 2,303 |
Total Past Due & Nonaccrual Loans | 34 | 2,329 |
Loans Not Past Due | 744,642 | 670,410 |
Total loans held for investment | 744,676 | 672,739 |
30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 8 | 26 |
60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 14 | 0 |
Greater than 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Real Estate | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans held for investment | 337,514 | 272,967 |
Real Estate | 1 - 4 Family Residential | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Loans Not Past Due | 44,022 | 48,433 |
Total loans held for investment | 44,022 | 48,433 |
Real Estate | 1 - 4 Family Residential | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Real Estate | 1 - 4 Family Residential | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Real Estate | 1 - 4 Family Residential | Greater than 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Real Estate | Multifamily | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Loans Not Past Due | 240,055 | 169,817 |
Total loans held for investment | 240,055 | 169,817 |
Real Estate | Multifamily | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Real Estate | Multifamily | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Real Estate | Multifamily | Greater than 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Real Estate | Commercial Real Estate | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Loans Not Past Due | 53,437 | 54,717 |
Total loans held for investment | 53,437 | 54,717 |
Real Estate | Commercial Real Estate | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Real Estate | Commercial Real Estate | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Real Estate | Commercial Real Estate | Greater than 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Real Estate | Construction | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Real Estate | Construction | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Real Estate | Construction | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Real Estate | Construction | Greater than 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Commercial | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Loans Not Past Due | 398,511 | 358,410 |
Total loans held for investment | 398,511 | 358,410 |
Commercial | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Commercial | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Commercial | Greater than 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Consumer | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Nonaccrual Loans | 12 | 2,303 |
Total Past Due & Nonaccrual Loans | 34 | 2,329 |
Loans Not Past Due | 8,617 | 39,033 |
Total loans held for investment | 8,651 | 41,362 |
Consumer | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 8 | 26 |
Consumer | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 14 | 0 |
Consumer | Greater than 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | $ 0 | $ 0 |
Loans - Summary of loans by cre
Loans - Summary of loans by credit quality indicator based on internally assigned credit grade (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021USD ($)item | Sep. 30, 2020item | Sep. 30, 2021USD ($)item | Sep. 30, 2020item | Dec. 31, 2020USD ($)item | |
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | $ 744,676 | $ 744,676 | $ 672,739 | ||
Number of loans identified as troubled debt restructuring | item | 0 | 0 | |||
Number of loans modified | item | 0 | 0 | 0 | 0 | |
Federal Reserve Bank of New York (FRB) | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Loans pledged | $ 36,400 | $ 36,400 | $ 37,500 | ||
Maximum borrowing capacity | 26,100 | 26,100 | 28,600 | ||
Pass | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 715,093 | 715,093 | 662,422 | ||
Special Mention | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 24,810 | 24,810 | 7,899 | ||
Substandard | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 4,773 | 4,773 | 2,418 | ||
Doubtful | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 0 | 0 | 0 | ||
Real Estate | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 337,514 | 337,514 | 272,967 | ||
Real Estate | 1 - 4 Family Residential | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 44,022 | 44,022 | 48,433 | ||
Real Estate | 1 - 4 Family Residential | Pass | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 41,007 | 41,007 | 45,418 | ||
Real Estate | 1 - 4 Family Residential | Special Mention | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 3,015 | 3,015 | 3,015 | ||
Real Estate | 1 - 4 Family Residential | Substandard | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 0 | 0 | 0 | ||
Real Estate | 1 - 4 Family Residential | Doubtful | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 0 | 0 | 0 | ||
Real Estate | Multifamily | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 240,055 | 240,055 | 169,817 | ||
Real Estate | Multifamily | Pass | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 239,334 | 239,334 | 169,096 | ||
Real Estate | Multifamily | Special Mention | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 0 | 0 | 721 | ||
Real Estate | Multifamily | Substandard | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 721 | 721 | 0 | ||
Real Estate | Multifamily | Doubtful | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 0 | 0 | 0 | ||
Real Estate | Commercial Real Estate | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 53,437 | 53,437 | 54,717 | ||
Real Estate | Commercial Real Estate | Pass | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 49,619 | 49,619 | 54,717 | ||
Real Estate | Commercial Real Estate | Special Mention | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 3,818 | 3,818 | 0 | ||
Real Estate | Commercial Real Estate | Substandard | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 0 | 0 | 0 | ||
Real Estate | Commercial Real Estate | Doubtful | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 0 | 0 | 0 | ||
Real Estate | Construction | Special Mention | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 0 | 0 | 0 | ||
Real Estate | Construction | Substandard | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 0 | 0 | 0 | ||
Real Estate | Construction | Doubtful | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 0 | 0 | 0 | ||
Commercial | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 398,511 | 398,511 | 358,410 | ||
Commercial | Pass | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 376,482 | 376,482 | 358,295 | ||
Commercial | Special Mention | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 17,977 | 17,977 | 0 | ||
Commercial | Substandard | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 4,052 | 4,052 | 115 | ||
Commercial | Doubtful | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 0 | 0 | 0 | ||
Consumer | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 8,651 | 8,651 | 41,362 | ||
Consumer | Pass | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 8,651 | 8,651 | 34,896 | ||
Consumer | Special Mention | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 0 | 0 | 4,163 | ||
Consumer | Substandard | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | 0 | 0 | 2,303 | ||
Consumer | Doubtful | |||||
Financing Receivable, Recorded Investment [Line Items] | |||||
Total loans held for investment | $ 0 | $ 0 | $ 0 |
Noninterest Income (Details)
Noninterest Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Noninterest income | ||||
Unrealized loss on loans held for sale | $ (384) | $ (384) | ||
Total non-interest income | 4,924 | $ 3,884 | 15,856 | $ 9,959 |
Administrative service income | ||||
Noninterest income | ||||
Noninterest income | 41 | 29 | 140 | |
Merchant services income | ||||
Noninterest income | ||||
Noninterest income | 5,021 | 3,551 | 15,339 | 9,023 |
ACH income | ||||
Noninterest income | ||||
Noninterest income | 206 | 170 | 609 | 504 |
Other | ||||
Noninterest income | ||||
Noninterest income | $ 81 | $ 122 | $ 263 | $ 292 |
Share-Based Payment Plans - Sum
Share-Based Payment Plans - Summary of options activity (Details) - Stock Options - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Options | ||||
Outstanding at beginning of year | 907,099 | |||
Granted | 0 | 0 | 0 | 0 |
Exercised | (113,121) | |||
Forfeited | (501) | |||
Expired | (415) | |||
Outstanding at period end | 793,062 | 793,062 | ||
Vested or expected to vest | 793,062 | 793,062 | ||
Exercisable at period end | 709,114 | 709,114 | ||
Weighted Average Exercise Price | ||||
Outstanding at beginning of year | $ 14.11 | |||
Granted | 0 | |||
Exercised | 12.72 | |||
Forfeited | 23.08 | |||
Expired | 25.02 | |||
Outstanding at period end | $ 14.30 | 14.30 | ||
Vested or expected to vest | 14.30 | 14.30 | ||
Exercisable at period end | $ 13.43 | $ 13.43 | ||
Weighted Average Remaining Contractual Life (Years), outstanding at period end | 5 years 25 days | |||
Weighted Average Remaining Contractual Life (Years), vested or expected to vest | 5 years 25 days | |||
Weighted Average Remaining Contractual Life (Years), exercisable at period end | 4 years 7 months 17 days |
Share-Based Payment Plans - S_2
Share-Based Payment Plans - Summary of restricted stock activity (Details) - Restricted stock | 9 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Shares | |
Outstanding at beginning of year | shares | 380,750 |
Vested or expected to vest | shares | 0 |
Outstanding at period end | shares | 380,750 |
Weighted Average Grant Date Fair Value | |
Outstanding at beginning of year | $ / shares | $ 22.87 |
Vested or expected to vest | $ / shares | 0 |
Outstanding at period end | $ / shares | $ 22.87 |
Share-Based Payment Plans - Add
Share-Based Payment Plans - Additional disclosures (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Proceeds from options exercised | $ 21 | $ 290 | ||
Stock Options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of stock options issued | 0 | 0 | 0 | 0 |
Contractual term of awards | 10 years | |||
Stock options expense | $ 117 | $ 124 | $ 380 | $ 387 |
Unrecognized compensation cost related to non-vested options | 562 | $ 562 | ||
Recognition period of nonvested stock options | 2 years 21 days | |||
Intrinsic value of outstanding options | 11,400 | $ 11,400 | ||
Intrinsic value of exercisable options | 10,800 | 10,800 | ||
Intrinsic value of options exercised | 403 | 1,275 | 878 | |
Proceeds from options exercised | 21 | 290 | ||
Tax benefit of options exercised | 78 | $ 244 | 77 | |
Stock Options | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 3 years | |||
Stock Options | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 5 years | |||
Restricted stock | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 6 years | |||
Vesting percentage after years four, five and six | 33.30% | |||
Stock options expense | 365 | $ 259 | $ 1,100 | $ 771 |
Unrecognized compensation cost related to non-vested options | $ 5,800 | $ 5,800 | ||
Recognition period of nonvested stock options | 4 years 3 months |
Earnings per Share - Summary of
Earnings per Share - Summary of earnings per share computation (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Basic | ||||
Net income | $ 2,519 | $ 3,606 | $ 11,195 | $ 8,736 |
Weighted average common shares outstanding (in shares) | 7,460,897 | 7,403,840 | 7,445,497 | 7,414,264 |
Basic earnings per share (in dollars per share) | $ 0.34 | $ 0.49 | $ 1.50 | $ 1.18 |
Diluted | ||||
Weighted average shares outstanding for basic earnings per share | 7,460,897 | 7,403,840 | 7,445,497 | 7,414,264 |
Add: Dilutive effects of share based awards | 487,145 | 172,124 | 448,076 | 225,103 |
Average shares and dilutive potential common shares | 7,948,042 | 7,575,964 | 7,893,573 | 7,639,367 |
Diluted earnings per share (in dollars per share) | $ 0.32 | $ 0.48 | $ 1.42 | $ 1.14 |
Stock options and restricted shares not considered in computing diluted earnings per share because they were anti-dilutive | 107,600 | 303,250 | 107,600 | 303,250 |
Leases (Details)
Leases (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Leases | ||
ROU lease assets | $ 2,500 | $ 2,900 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Other Assets | Other Assets |
lease liability | $ 3,127 | $ 3,500 |
Operating Lease, Liability, Statement of Financial Position [Extensible List] | Accrued Liabilities and Other Liabilities | Accrued Liabilities and Other Liabilities |
Leases - Maturities of operatin
Leases - Maturities of operating lease (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Maturities of operating lease liabilities | ||
2021 | $ 163 | |
2022 | 643 | |
2023 | 636 | |
2024 | 652 | |
2025 | 668 | |
Thereafter | 627 | |
Total lease payments | 3,389 | |
Less: interest | 262 | |
Present value of operating lease liabilities | $ 3,127 | $ 3,500 |
Leases - Lease Cost (Details)
Leases - Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Lease cost | ||||
Weighted-average remaining lease term | 5 years 1 month 13 days | 6 years 29 days | 5 years 1 month 13 days | 6 years 29 days |
Weighted-average discount rate | 3.05% | 3.05% | 3.05% | 3.05% |
Operating lease cost | $ 142 | $ 141 | $ 425 | $ 422 |
Short-term Lease, Cost | 14 | 13 | 52 | |
Total lease cost | 142 | 155 | 438 | 474 |
Cash paid for operating lease liability | $ 161 | $ 173 | $ 503 | $ 431 |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of assets and liabilities measured at fair value on recurring basis (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 |
Available-for-sale securities | |||
Securities available-for-sale, at fair value | $ 141,703 | $ 117,655 | |
Fair Value, Assets, Level 1 to Level 2 Transfers, Amount | 0 | $ 0 | |
Fair Value, Assets, Level 2 to Level 1 Transfers, Amount | 0 | $ 0 | |
Mortgage-backed securities - agency | |||
Available-for-sale securities | |||
Securities available-for-sale, at fair value | 116,065 | 56,400 | |
CMO's - agency | |||
Available-for-sale securities | |||
Securities available-for-sale, at fair value | 25,638 | 61,255 | |
(Level 1) | |||
Available-for-sale securities | |||
Securities available-for-sale, at fair value | 0 | 0 | |
(Level 2) | |||
Available-for-sale securities | |||
Securities available-for-sale, at fair value | 141,703 | 117,655 | |
(Level 3) | |||
Available-for-sale securities | |||
Securities available-for-sale, at fair value | 0 | 0 | |
Recurring | (Level 1) | |||
Available-for-sale securities | |||
Securities available-for-sale, at fair value | 0 | 0 | |
Recurring | (Level 1) | Mortgage-backed securities - agency | |||
Available-for-sale securities | |||
Securities available-for-sale, at fair value | 0 | 0 | |
Recurring | (Level 1) | CMO's - agency | |||
Available-for-sale securities | |||
Securities available-for-sale, at fair value | 0 | 0 | |
Recurring | (Level 2) | |||
Available-for-sale securities | |||
Securities available-for-sale, at fair value | 141,703 | 117,655 | |
Recurring | (Level 2) | Mortgage-backed securities - agency | |||
Available-for-sale securities | |||
Securities available-for-sale, at fair value | 116,065 | 56,400 | |
Recurring | (Level 2) | CMO's - agency | |||
Available-for-sale securities | |||
Securities available-for-sale, at fair value | 25,638 | 61,255 | |
Recurring | (Level 3) | |||
Available-for-sale securities | |||
Securities available-for-sale, at fair value | 0 | 0 | |
Recurring | (Level 3) | Mortgage-backed securities - agency | |||
Available-for-sale securities | |||
Securities available-for-sale, at fair value | 0 | 0 | |
Recurring | (Level 3) | CMO's - agency | |||
Available-for-sale securities | |||
Securities available-for-sale, at fair value | $ 0 | $ 0 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2021 | Dec. 31, 2020 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans held for sale | $ 14,200 | |
Discount rate (as a percent) | 8.00% | |
Valuation adjustment | $ 384 | |
Assets | $ 0 | |
Liabilities | $ 0 | |
(Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans held for sale | $ 14,200 |
Fair Value Measurements - Sum_2
Fair Value Measurements - Summary of estimated fair values of financial instruments (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Financial Assets: | ||
Securities purchased under agreements to resell, at cost | $ 50,899 | $ 51,726 |
Securities available for sale | 141,703 | 117,655 |
Securities, restricted, at cost | 2,680 | 2,694 |
Loans held for investment, net | 735,427 | 661,019 |
Accrued interest receivable | 4,462 | 4,529 |
Other assets - loans held for sale | 14,200 | |
Financial Liabilities: | ||
Time deposits | 11,125 | 11,202 |
(Level 1) | ||
Financial Assets: | ||
Cash and cash equivalents | 1,129 | 1,775 |
Securities available for sale | 0 | 0 |
Loans held for investment, net | 0 | 0 |
Accrued interest receivable | 0 | 0 |
Financial Liabilities: | ||
Time deposits | 0 | |
Demand and other deposits | 965,918 | 792,852 |
Secured borrowings | 0 | 0 |
Accrued interest payable | 0 | 0 |
(Level 2) | ||
Financial Assets: | ||
Cash and cash equivalents | 137,106 | 63,410 |
Securities available for sale | 141,703 | 117,655 |
Loans held for investment, net | 0 | 0 |
Accrued interest receivable | 280 | 245 |
Financial Liabilities: | ||
Time deposits | 11,163 | 11,246 |
Demand and other deposits | 0 | 0 |
Secured borrowings | 48 | 49 |
Accrued interest payable | 0 | 0 |
(Level 3) | ||
Financial Assets: | ||
Cash and cash equivalents | 0 | 0 |
Securities purchased under agreements to resell, at cost | 50,899 | 51,726 |
Securities available for sale | 0 | 0 |
Loans held for investment, net | 735,232 | 661,992 |
Accrued interest receivable | 4,182 | 4,284 |
Other assets - loans held for sale | 14,200 | |
Financial Liabilities: | ||
Time deposits | 0 | |
Demand and other deposits | 0 | 0 |
Secured borrowings | 0 | 0 |
Accrued interest payable | 0 | 0 |
Carrying Value | ||
Financial Assets: | ||
Cash and cash equivalents | 138,235 | 65,185 |
Securities purchased under agreements to resell, at cost | 50,899 | 51,726 |
Securities available for sale | 141,703 | 117,655 |
Securities, restricted, at cost | 2,680 | 2,694 |
Loans held for investment, net | 735,427 | 661,019 |
Accrued interest receivable | 4,462 | 4,529 |
Other assets - loans held for sale | 14,200 | |
Financial Liabilities: | ||
Time deposits | 11,125 | 11,202 |
Demand and other deposits | 965,918 | 792,852 |
Secured borrowings | 48 | 49 |
Accrued interest payable | 0 | 0 |
Fair Value | ||
Financial Assets: | ||
Cash and cash equivalents | 138,235 | 65,185 |
Securities purchased under agreements to resell, at cost | 50,899 | 51,726 |
Securities available for sale | 141,703 | 117,655 |
Loans held for investment, net | 735,232 | 661,992 |
Accrued interest receivable | 4,462 | 4,529 |
Other assets - loans held for sale | 14,200 | |
Financial Liabilities: | ||
Time deposits | 11,163 | 11,246 |
Demand and other deposits | 965,918 | 792,852 |
Secured borrowings | 48 | 49 |
Accrued interest payable | $ 0 | $ 0 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive (Loss) Income - Summary of changes in accumulated other comprehensive income (loss) by component, net of tax (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Unrealized (Losses) Gains on Available-for-Sale Securities | ||||
Beginning balance | $ 323 | $ 1,899 | $ 1,408 | $ 386 |
Other comprehensive (loss) income before reclassifications, net of tax | (490) | (246) | (1,575) | 1,267 |
Amounts reclassified from accumulated other comprehensive income | 0 | 0 | 0 | 0 |
Net current period other comprehensive (loss) income | (490) | (246) | (1,575) | 1,267 |
Ending balance | (167) | 1,653 | (167) | 1,653 |
Reclassifications | $ 0 | $ 0 | $ 0 | $ 0 |