Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2022 | Nov. 01, 2022 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2022 | |
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, $0.01 par value | |
Trading Symbol | ESQ | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 8,149,321 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2022 | |
Amendment Flag | false | |
Entity Central Index Key | 0001531031 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
ASSETS | ||
Cash and cash equivalents | $ 182,125 | $ 149,156 |
Securities purchased under agreements to resell, at cost | 50,225 | 50,271 |
Securities available-for-sale, at fair value | 111,375 | 148,384 |
Securities held-to-maturity, at cost (fair value $71,436 at September 30, 2022) | 80,102 | 0 |
Securities, restricted, at cost | 2,810 | 2,680 |
Loans held for investment | 875,114 | 784,517 |
Less: allowance for loan losses | (10,885) | (9,076) |
Loans, net of allowance | 864,229 | 775,441 |
Premises and equipment, net | 2,852 | 3,334 |
Accrued interest receivable | 5,228 | 4,197 |
Other assets | 48,597 | 45,307 |
Total assets | 1,347,543 | 1,178,770 |
Deposits: | ||
Demand | 445,557 | 409,350 |
Savings, NOW and money market | 722,972 | 599,747 |
Time | 18,928 | 19,312 |
Total deposits | 1,187,457 | 1,028,409 |
Accrued expenses and other liabilities | 11,548 | 6,626 |
Total liabilities | 1,199,005 | 1,035,035 |
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; 8,119,000 and 8,123,152 shares issued, respectively; and 8,082,918 and 8,088,846 shares outstanding, respectively | 81 | 81 |
Additional paid-in capital | 95,616 | 93,611 |
Retained earnings | 69,409 | 51,460 |
Accumulated other comprehensive loss | (15,942) | (850) |
Treasury stock at cost, 36,082 and 34,306 shares, respectively | (626) | (567) |
Total stockholders' equity | 148,538 | 143,735 |
Total liabilities and stockholders' equity | $ 1,347,543 | $ 1,178,770 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Parentheticals) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION | ||
Securities held to maturity, fair value | $ 71,436 | |
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 | 8,119,000 | 8,123,152 |
Common stock, shares outstanding | 8,082,918 | 8,088,846 |
Treasury stock, shares | 36,082 | 34,306 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Interest income: | ||||
Loans | $ 14,055 | $ 10,709 | $ 37,499 | $ 30,408 |
Securities | 1,126 | 583 | 2,975 | 1,588 |
Securities purchased under agreements to resell | 377 | 150 | 699 | 470 |
Interest earning deposits and other | 402 | 51 | 767 | 134 |
Total interest income | 15,960 | 11,493 | 41,940 | 32,600 |
Interest expense: | ||||
Savings, NOW and money market deposits | 368 | 189 | 841 | 536 |
Time deposits | 44 | 19 | 90 | 59 |
Borrowings | 1 | 1 | 3 | 2 |
Total interest expense | 413 | 209 | 934 | 597 |
Net interest income | 15,547 | 11,284 | 41,006 | 32,003 |
Provision for loan losses | 650 | 3,750 | 2,140 | 6,400 |
Net interest income after provision for loan losses | 14,897 | 7,534 | 38,866 | 25,603 |
Noninterest income: | ||||
Total noninterest income | 6,432 | 4,924 | 18,143 | 15,856 |
Noninterest expense: | ||||
Employee compensation and benefits | 6,519 | 5,523 | 18,952 | 16,189 |
Occupancy and equipment | 760 | 696 | 2,260 | 2,104 |
Professional and consulting services | 840 | 773 | 2,298 | 2,352 |
FDIC and regulatory assessments | 142 | 111 | 401 | 320 |
Advertising and marketing | 480 | 289 | 1,109 | 936 |
Travel and business relations | 179 | 105 | 403 | 212 |
Data processing | 1,107 | 977 | 3,167 | 2,734 |
Other operating expenses | 811 | 533 | 2,019 | 1,466 |
Total noninterest expense | 10,838 | 9,007 | 30,609 | 26,313 |
Net income before income taxes | 10,491 | 3,451 | 26,400 | 15,146 |
Income tax expense | 2,780 | 932 | 6,996 | 3,951 |
Net income | $ 7,711 | $ 2,519 | $ 19,404 | $ 11,195 |
Earnings per share | ||||
Basic (in dollars per share) | $ 1.01 | $ 0.34 | $ 2.54 | $ 1.50 |
Diluted (in dollars per share) | $ 0.94 | $ 0.32 | $ 2.37 | $ 1.42 |
Payment processing fees | ||||
Noninterest income: | ||||
Noninterest income | $ 5,458 | $ 5,227 | $ 16,287 | $ 15,948 |
Customer related fees, service charges and other | ||||
Noninterest income: | ||||
Noninterest income | $ 974 | 81 | 1,768 | 292 |
Gain (loss) on loans held for sale member | ||||
Noninterest income: | ||||
Noninterest income | $ (384) | $ 88 | $ (384) |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||||
Net income | $ 7,711 | $ 2,519 | $ 19,404 | $ 11,195 |
Other comprehensive (loss) income: | ||||
Unrealized losses arising during the period on securities available-for-sale | (6,434) | (686) | (20,799) | (2,203) |
Tax effect | 1,769 | 196 | 5,707 | 628 |
Total other comprehensive loss | (4,665) | (490) | (15,092) | (1,575) |
Total comprehensive (loss) income | $ 3,046 | $ 2,029 | $ 4,312 | $ 9,620 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Common stock | Additional paid-in capital | Retained earnings | Accumulated other comprehensive (loss) income. | Treasury stock | Total |
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 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 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 | |||||
Balance at Dec. 31, 2021 | $ 81 | 93,611 | 51,460 | (850) | (567) | 143,735 |
Balance (in shares) at Dec. 31, 2021 | 8,088,846 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 19,404 | 19,404 | ||||
Other comprehensive loss | (15,092) | (15,092) | ||||
Restricted stock award forfeitures (in shares) | (13,750) | |||||
Cash dividends paid to common stockholders ($0.09 per share) | 1,455 | 1,455 | ||||
Exercise of stock options, net of repurchases | 178 | 178 | ||||
Exercise of stock options, net of repurchases (in shares) | 9,598 | |||||
Vested restricted stock awards settlement | (59) | (59) | ||||
Vested restricted stock awards settlement (in shares) | (1,776) | |||||
Stock compensation expense | 1,827 | 1,827 | ||||
Balance at Sep. 30, 2022 | $ 81 | 95,616 | 69,409 | (15,942) | (626) | 148,538 |
Balance (in shares) at Sep. 30, 2022 | 8,082,918 | |||||
Balance at Jun. 30, 2022 | $ 81 | 94,923 | 62,426 | (11,277) | (626) | 145,527 |
Balance (in shares) at Jun. 30, 2022 | 8,080,486 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 7,711 | 7,711 | ||||
Other comprehensive loss | (4,665) | (4,665) | ||||
Restricted stock award forfeitures (in shares) | 2,432 | |||||
Cash dividends paid to common stockholders ($0.09 per share) | 728 | 728 | ||||
Exercise of stock options, net of repurchases | 7 | 7 | ||||
Stock compensation expense | 686 | 686 | ||||
Balance at Sep. 30, 2022 | $ 81 | $ 95,616 | $ 69,409 | $ (15,942) | $ (626) | $ 148,538 |
Balance (in shares) at Sep. 30, 2022 | 8,082,918 |
CONDENSED CONSOLIDATED STATEM_6
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Parenthetical) - $ / shares | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY | ||
Repurchase of shares | 59,109 | |
Cash dividends (per share) | $ 0.09 |
CONDENSED CONSOLIDATED STATEM_7
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Cash flows from operating activities: | ||
Net income | $ 19,404 | $ 11,195 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Provision for loan losses | 2,140 | 6,400 |
Depreciation | 533 | 516 |
Stock compensation expense | 1,827 | 1,464 |
Gain on loans held for sale | (88) | 384 |
Net amortization (accretion): | ||
Securities | 426 | 613 |
Loans | (747) | (1,034) |
Right of use asset | 354 | 415 |
Software | 911 | 749 |
Changes in other assets and liabilities: | ||
Accrued interest receivable | (1,031) | 67 |
Other assets | 1,619 | (543) |
Operating lease liability | (424) | (405) |
Accrued expenses and other liabilities | 5,435 | 2,868 |
Net cash provided by operating activities | 30,359 | 22,689 |
Cash flows from investing activities: | ||
Net change in loans | (90,181) | (94,358) |
Net change in securities purchased under agreements to resell | 46 | 827 |
Purchases of securities available-for-sale | (1,739) | (70,478) |
Purchases of securities held-to-maturity | (84,092) | |
Principal repayments on securities available-for-sale | 17,602 | 43,614 |
Principal repayments on securities held-to-maturity | 3,911 | |
Redemption (purchase) of securities, restricted | (130) | 14 |
Payments on loans held for sale | 600 | |
Purchases of premises and equipment | (51) | (942) |
Development of capitalized software | (1,067) | (1,325) |
Net cash used in investing activities | (155,101) | (122,648) |
Cash flows from financing activities: | ||
Net increase in deposits | 159,048 | 172,989 |
Decrease in borrowings | (1) | (1) |
Exercise of stock options | 178 | 21 |
Tax withholding payments for vested equity awards | (59) | |
Cash dividends paid to common stockholders | 1,455 | |
Net cash provided by financing activities | 157,711 | 173,009 |
(Decrease) increase in cash and cash equivalents | 32,969 | 73,050 |
Cash and cash equivalents at beginning of the period | 149,156 | 65,185 |
Cash and cash equivalents at end of the period | 182,125 | 138,235 |
Cash paid during the period for: | ||
Interest | 924 | 597 |
Taxes | 5,879 | 5,854 |
Noncash transactions: | ||
Contribution of loans held for sale for equity in variable interest entity | $ 13,500 | |
Transfer from loans held for investment to held for sale | $ 14,584 |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2022 | |
Basis of Presentation and Summary of Significant Accounting Policies | |
Basis of Presentation and Summary of Significant Accounting Policies | ESQUIRE FINANCIAL HOLDINGS, INC. NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 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, 2021 and 2020. Operating results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022 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. 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 2022 Consolidated Statement of Financial Condition and Consolidated Statement of Income. Subsequent Events The Company has evaluated events for recognition and disclosure through the date of issuance. Investment in Variable Interest Entity On April 1, 2022, the Company sold its legacy NFL consumer post-settlement loan portfolio to a variable interest entity (VIE) in exchange for a nonvoting interest valued at $13.5 million where the Company will remain as servicer of the loan portfolio at the discretion of the VIE manager. The Company’s investment is considered a significant variable interest, but it does not have the power to direct the activities that most significantly impact the VIE’s economic performance. Therefore, the Company is not considered the primary beneficiary of this VIE and does not consolidate the entity in the Company’s financial statements. The Company’s maximum exposure to loss is limited to the carrying amount of its investment and accounted for under the equity method which is presented within other assets on the Consolidated Statement of Financial Condition. 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 are accounted for at lower of cost or fair value. Net unrealized losses, if any, are recorded as a valuation allowance and charged to earnings. Loans held for sale is included with Other assets on the Consolidated Statement of Financial Condition. New Accounting Pronouncements In June 2016, the FASB issued Accounting Standards Update (“ASU”) 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 a smaller reporting company on January 1, 2023. The Company plans to adopt ASU 2016-13 on 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. In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” ASU 2020-04 provides optional expedients and exceptions for accounting related to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met. ASU 2020-04 applies only to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform and do not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022, except for hedging relationships existing as of December 31, 2022, that an entity has elected certain optional expedients for and that are retained through the end of the hedging relationship. ASU 2020-04 was effective upon issuance and generally can be applied through December 31, 2022. Adoption of the standard is not expected to have a material impact on the Company’s operating results or financial condition. In March 2022, the FASB issued ASU 2022-02, “Financial Instruments — Credit Losses (Topic 326): Troubled Debt Restructuring and Vintage Disclosures”. ASU 2022-02 eliminates the accounting guidance for TDRs by creditors in Subtopic 310-40, “Receivables — Troubled Debt Restructurings by Creditors”, while enhancing disclosure requirements for certain loan refinancing and restructurings by creditors when a borrower is experiencing financial difficulty. Additionally, the amendments in this ASU require that public business entities disclose current-period gross write-offs by year of origination for financing receivables and net investments in leases within the scope of ASU 326-20, “Financial Instruments — Credit Losses: Measured at Amortized Cost”. The Company is in the process of evaluating the ASU in conjunction with its adoption of CECL on January 1, 2023. In March 2022, the SEC issued Staff Accounting Bulletin (SAB) No. 121 which provides interpretive guidance for the accounting and disclosure of obligations to safeguard crypto-assets held for platform users effective the first interim or annual period ending after June 15, 2022. This guidance does not have an impact on the Company’s financial statements as no crypto-asset related activities are conducted by the Company. |
Debt Securities
Debt Securities | 9 Months Ended |
Sep. 30, 2022 | |
Debt Securities | |
Debt Securities | NOTE 2 — Debt Securities The following tables summarize the amortized cost and fair value of securities available-for-sale and securities held-to-maturity and the corresponding amounts of gross unrealized gains and losses recognized in accumulated other comprehensive loss and gross unrecognized gains and losses: September 30, 2022 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value (In thousands) Securities available-for-sale: Mortgage-backed securities – agency $ 113,658 $ — $ (19,587) $ 94,071 Collateralized mortgage obligations (CMOs) – agency 19,706 — (2,402) 17,304 Total available-for-sale $ 133,364 $ — $ (21,989) $ 111,375 Gross Gross Amortized Unrecognized Unrecognized Fair Cost Gains Losses Value (In thousands) Securities held-to-maturity: Collateralized mortgage obligations (CMOs) – agency $ 80,102 $ — $ (8,666) $ 71,436 Total held-to-maturity $ 80,102 $ — $ (8,666) $ 71,436 December 31, 2021 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value (In thousands) Securities available-for-sale: Mortgage-backed securities – agency $ 122,258 $ 673 $ (2,050) $ 120,881 Collateralized mortgage obligations (CMOs) – agency 27,316 237 (50) 27,503 Total available-for-sale $ 149,574 $ 910 $ (2,100) $ 148,384 As of December 31, 2021, there were no securities held-to-maturity. 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, 2022 and 2021. At September 30, 2022, securities having a carrying value of $153.8 million were pledged to the Federal Home Loan Bank of New York (FHLB) for borrowing capacity totaling $139.0 million. At December 31, 2021, securities having a fair value of $121.5 million were pledged to the FHLB for borrowing capacity totaling $115.4 million. At September 30, 2022 and December 31, 2021, the Company had no outstanding FHLB advances. At September 30, 2022, securities having a fair value of $37.7 million were pledged to the Federal Reserve Bank of New York (FRB) for borrowing capacity totaling $36.6 million. At December 31, 2021, securities having a fair value of $26.9 million were pledged to the FRB for borrowing capacity totaling $26.1 million. At September 30, 2022 and December 31, 2021, the Company had no outstanding FRB borrowings. The following table provides the gross unrealized and unrecognized losses and fair value, aggregated by investment category and length of time the individual securities have been in a continuous unrealized or unrecognized loss position as of: September 30, 2022 Less Than 12 Months 12 Months or Longer Total Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses (In thousands) Securities available-for-sale: Mortgage-backed securities – agency $ 24,357 $ (3,618) $ 69,714 $ (15,969) $ 94,071 $ (19,587) CMOs – agency 16,315 (2,291) 989 (111) 17,304 (2,402) Total temporarily impaired securities $ 40,672 $ (5,909) $ 70,703 $ (16,080) $ 111,375 $ (21,989) Less Than 12 Months 12 Months or Longer Total Fair Value Gross Unrecognized Losses Fair Value Gross Unrecognized Losses Fair Value Gross Unrecognized Losses (In thousands) Securities held-to-maturity: CMOs – agency $ 71,436 $ (8,666) $ — $ — $ 71,436 $ (8,666) Total temporarily impaired securities $ 71,436 $ (8,666) $ — $ — $ 71,436 $ (8,666) December 31, 2021 Less Than 12 Months 12 Months or Longer Total Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses (In thousands) Securities available-for-sale: Mortgage-backed securities - agency $ 101,235 $ (1,813) $ 4,503 $ (237) $ 105,738 $ (2,050) CMOs - Agency 7,416 (50) — — 7,416 (50) Total temporarily impaired securities $ 108,651 $ (1,863) $ 4,503 $ (237) $ 113,154 $ (2,100) 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, 2022, securities in unrealized or unrecognized 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, 2022. No impairment charges were recorded for the three and nine months ended September 30, 2022 and 2021. |
Loans
Loans | 9 Months Ended |
Sep. 30, 2022 | |
Loans | |
Loans | NOTE 3 — Loans The composition of loans by class is summarized as follows: At September 30, At December 31, 2022 2021 (In thousands) Real estate: Multifamily $ 263,689 $ 254,852 Commercial real estate 83,515 48,589 1 – 4 family 31,496 40,753 Construction — — Total real estate 378,700 344,194 Commercial 478,854 432,108 Consumer 18,424 8,681 Total loans held for investment $ 875,978 $ 784,983 Deferred loan fees and unearned premiums, net (864) (466) Allowance for loan losses (10,885) (9,076) Loans held for investment, net $ 864,229 $ 775,441 At December 31, 2021, the commercial loans balance included Small Business Administration (“SBA”) Paycheck Protection Program (“PPP”) loans of $4.2 million. There were no PPP loans outstanding at September 30, 2022. The following tables present the activity in the allowance for loan losses by class for the three months ending September 30, 2022 and 2021: Commercial Multifamily Real Estate 1 ‑ 4 Family Construction Commercial Consumer Total (In thousands) September 30, 2022 Allowance for loan losses: Beginning balance $ 1,916 $ 902 $ 253 $ — $ 7,045 $ 155 $ 10,271 Provision (credit) for loan losses 11 35 (15) — 418 201 650 Recoveries — — — — — — — Loans charged-off — — — — — (36) (36) Total ending allowance balance $ 1,927 $ 937 $ 238 $ — $ 7,463 $ 320 $ 10,885 September 30, 2021 Allowance for loan losses: Beginning balance $ 1,418 $ 603 $ 312 $ — $ 5,547 $ 6,137 $ 14,017 Provision (credit) for loan losses 274 (4) (3) — 385 3,098 3,750 Recoveries — — — — — — — Loans charged-off — — — — — (9,102) (9,102) Total ending allowance balance $ 1,692 $ 599 $ 309 $ — $ 5,932 $ 133 $ 8,665 The following tables present the activity in the allowance for loan losses by class for the nine months ending September 30, 2022 and 2021: Commercial Multifamily Real Estate 1 ‑ 4 Family Construction Commercial Consumer Total (In thousands) September 30, 2022 Allowance for loan losses: Beginning balance $ 1,789 $ 552 $ 285 $ — $ 6,319 $ 131 $ 9,076 Provision (credit) for loan losses 299 385 (47) — 1,206 297 2,140 Recoveries 17 — — — 2 — 19 Loans charged-off (178) — — — (64) (108) (350) Total ending allowance balance $ 1,927 $ 937 $ 238 $ — $ 7,463 $ 320 $ 10,885 September 30, 2021 Allowance for loan losses: Beginning balance $ 1,278 $ 597 $ 342 $ — $ 5,003 $ 4,182 $ 11,402 Provision (credit) for loan losses 414 2 (33) — 929 5,088 6,400 Recoveries — — — — — — — Loans charged-off — — — — — (9,137) (9,137) Total ending allowance balance $ 1,692 $ 599 $ 309 $ — $ 5,932 $ 133 $ 8,665 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, 2022 and December 31, 2021: Commercial Multifamily Real Estate 1 ‑ 4 Family Construction Commercial Consumer Total (In thousands) September 30, 2022 Allowance for loan losses: Ending allowance balance attributable to loans: Individually evaluated for impairment $ — $ — $ — $ — $ — $ — $ — Collectively evaluated for impairment 1,927 937 238 — 7,463 320 10,885 Total ending allowance balance $ 1,927 $ 937 $ 238 $ — $ 7,463 $ 320 $ 10,885 Loans: Loans individually evaluated for impairment $ — $ — $ — $ — $ 5,819 $ — $ 5,819 Loans collectively evaluated for impairment 263,689 83,515 31,496 — 473,035 18,424 870,159 Total ending loans balance $ 263,689 $ 83,515 $ 31,496 $ — $ 478,854 $ 18,424 $ 875,978 Commercial Multifamily Real Estate 1 ‑ 4 Family Construction Commercial Consumer Total (In thousands) December 31, 2021 Allowance for loan losses: Ending allowance balance attributable to loans: Individually evaluated for impairment $ — $ — $ — $ — $ — $ — $ — Collectively evaluated for impairment 1,789 552 285 — 6,319 131 9,076 Total ending allowance balance $ 1,789 $ 552 $ 285 $ — $ 6,319 $ 131 $ 9,076 Loans: Loans individually evaluated for impairment $ — $ — $ — $ — $ — $ — $ — Loans collectively evaluated for impairment 254,852 48,589 40,753 — 432,108 8,681 784,983 Total ending loans balance $ 254,852 $ 48,589 $ 40,753 $ — $ 432,108 $ 8,681 $ 784,983 Recorded investment is not adjusted for accrued interest, deferred fees and costs, and unearned premiums and discounts. The following table provides an analysis of the impaired loans by segment as of September 30, 2022 and December 31, 2021. There was no related allowance recorded on any impaired loans as of the periods indicated: September 30, December 31, 2022 2021 Unpaid Unpaid Recorded Principal Recorded Principal Investment Balance Investment Balance (In thousands) Multifamily $ — $ — $ — $ — Commercial real estate — — — — 1 – 4 family — — — — Construction — — — — Commercial 5,819 5,819 — — Consumer 1 1 — — Total $ 5,820 $ 5,820 $ — $ — 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, 2022. For the Three Months Ended September 30, For the Nine Months Ended September 30, 2022 2021 2022 2021 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) Multifamily $ — $ — $ — $ — $ 206 $ — $ 144 $ — Commercial real estate — — — — — — — — 1 – 4 family — — — — — — — — Construction — — — — — — — — Commercial 1,455 — — — 608 — — — Consumer — — 1,703 — 1 — 2,054 — Total $ 1,455 $ — $ 1,703 $ — $ 815 $ — $ 2,198 $ — The following tables present the aging of the recorded investment in past due loans by class of loans as of September 30, 2022 and December 31, 2021: 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, 2022 Multifamily $ — $ — $ — $ — $ — $ 263,689 263,689 Commercial real estate — — — — — 83,515 83,515 1 – 4 family — — — — — 31,496 $ 31,496 Construction — — — — — — — Commercial — — — 5,819 5,819 473,035 478,854 Consumer 18 9 — 1 28 18,396 18,424 Total $ 18 $ 9 $ — $ 5,820 $ 5,847 $ 870,131 $ 875,978 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, 2021 Multifamily $ 1,034 $ — $ — $ — $ 1,034 $ 253,818 $ 254,852 Commercial real estate — — — — — 48,589 48,589 1 – 4 family — — — — — 40,753 40,753 Construction — — — — — — — Commercial — — — — — 432,108 432,108 Consumer 21 10 — 6 37 8,644 8,681 Total $ 1,055 $ 10 $ — $ 6 $ 1,071 $ 783,912 $ 784,983 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, 2022 Multifamily $ 259,595 $ 3,373 $ 721 $ — Commercial real estate 79,697 3,818 — — 1 – 4 family 31,496 — — — Construction — — — — Commercial 466,480 6,555 5,819 — Consumer 16,536 1,888 — — Total $ 853,804 $ 15,634 $ 6,540 $ — Pass Special Mention Substandard Doubtful (In thousands) December 31, 2021 Multifamily $ 254,131 $ — $ 721 $ — Commercial real estate 44,771 3,818 — — 1 – 4 family 37,738 3,015 — — Construction — — — — Commercial 410,548 17,977 3,583 — Consumer 8,681 — — — Total $ 755,869 $ 24,810 $ 4,304 $ — 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, 2022 and December 31, 2021. Furthermore, there were no loans modified during the three and nine months ended September 30, 2022 and 2021 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. Pledged Loans At September 30, 2022, loans totaling $25.4 million were pledged to the Federal Home Loan Bank of New York for borrowing capacity totaling $20.0 million. At December 31, 2021, loans totaling $33.9 million were pledged to the Federal Home Loan Bank of New York for borrowing capacity totaling $26.0 million. |
Noninterest Income
Noninterest Income | 9 Months Ended |
Sep. 30, 2022 | |
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, 2022 2021 2022 2021 (In thousands) Payment processing fees Payment processing income $ 5,250 $ 5,021 $ 15,651 $ 15,339 ACH income 208 206 636 609 Customer related fees, service charges and other Administrative service income 886 — 1,512 29 Other 88 81 256 263 Gain (loss) on loans held for sale (1) — (384) 88 (384) Total noninterest income $ 6,432 $ 4,924 $ 18,143 $ 15,856 (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, 2022 | |
Share-Based Payment Plans | |
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, 2022 and 2021. The following table presents a summary of the activity related to options as of September 30, 2022: Weighted Weighted Average Average Remaining Exercise Contractual Options Price Life (Years) September 30, 2022 Outstanding at beginning of year 649,600 $ 16.66 Granted — — Exercised (12,332) 22.79 Forfeited (14,085) 25.20 Expired — — Outstanding at period end 623,183 $ 16.35 4.70 Vested or expected to vest 623,183 $ 16.35 4.70 Exercisable at period end 521,699 $ 14.24 3.90 The Company recognized compensation expense related to options of $112 thousand and $117 thousand for the three months ended September 30, 2022 and 2021, respectively. The Company recognized compensation expense related to options of $347 thousand and $380 thousand for the nine months ended September 30, 2022 and 2021, respectively. At September 30, 2022, unrecognized compensation cost related to nonvested options was approximately $788 thousand and is expected to be recognized over a weighted average period of 1.87 years. The intrinsic value for outstanding options and for options vested or expected to vest was $13.2 million and $12.2 million for exercisable options at September 30, 2022. 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, 2022 2021 2022 2021 (In thousands) Intrinsic value of options exercised $ 86 $ 403 $ 166 $ 1,275 Cash received from option exercises 7 — 178 21 Excess tax benefit from option exercises 15 78 15 244 The following table presents a summary of the activity related to restricted stock as of September 30, 2022: Weighted Average Grant Date Shares Fair Value September 30, 2022 Outstanding at beginning of year 482,750 $ 24.59 Granted — — Vested (25,497) 20.44 Forfeited (13,750) 24.31 Outstanding at period end 443,503 $ 24.84 The Company recognized compensation expense related to restricted stock of $574 thousand and $365 thousand for the three months ended September 30, 2022 and 2021, respectively. The Company recognized compensation expense related to restricted stock of $1.5 million and $1.1 million for the nine months ended September 30, 2022 and 2021, respectively. As of September 30, 2022, there was $6.7 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 4.03 |
Earnings per Share
Earnings per Share | 9 Months Ended |
Sep. 30, 2022 | |
Earnings per Share | |
Earnings per 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, 2022 2021 2022 2021 (Dollars in thousands, except per share data) Basic Net income $ 7,711 $ 2,519 $ 19,404 $ 11,195 Weighted average shares outstanding 7,637,407 7,460,897 7,628,903 7,445,497 Basic earnings per share $ 1.01 $ 0.34 $ 2.54 $ 1.50 Diluted Net income $ 7,711 $ 2,519 $ 19,404 $ 11,195 Weighted average shares outstanding for basic earnings per share 7,637,407 7,460,897 7,628,903 7,445,497 Add: Dilutive effects of share based awards 588,807 487,145 557,194 448,076 Average shares and dilutive potential shares 8,226,214 7,948,042 8,186,097 7,893,573 Diluted earnings per share $ 0.94 $ 0.32 $ 2.37 $ 1.42 Share-based awards totaling 61,900 and 107,600 shares of common stock were not considered in computing diluted earnings per common share for the three months ended September 30, 2022 and September 30, 2021, respectively, because they were anti-dilutive. Share-based awards totaling 65,367 and 107,600 shares of common stock were not considered in computing diluted earnings per common share for the nine months ended September 30, 2022 and September 30, 2021, respectively, because they were anti-dilutive. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2022 | |
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. As of September 30, 2022, right of use (“ROU”) lease assets liabilities assets liabilities Maturities of the Company’s operating lease liabilities at September 30, 2022 are as follows: Operating Lease Liabilities (In thousands) 2022 $ 157 2023 636 2024 652 2025 668 2026 627 Thereafter — Total operating lease payments $ 2,740 Less: interest 176 Present value of operating lease liabilities $ 2,564 As of September 30, 2022 2021 Weighted-average remaining lease term 4.17 years 5.12 years Weighted-average discount rate 3.08 % 3.05 % The components of total lease cost are as follows: For the Three Months Ended For the Nine Months Ended September 30, 2022 2021 2022 2021 (In thousands) Operating lease cost $ 135 $ 142 $ 419 $ 425 Short-term lease cost — — — 13 Total lease cost $ 135 $ 142 $ 419 $ 438 Cash paid for operating leases $ 162 $ 161 $ 490 $ 503 |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2022 | |
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 In Active Markets For Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (Level 1) (Level 2) (Level 3) (In thousands) September 30, 2022 Assets Available-for-sale securities Mortgage-backed securities – agency $ — $ 94,071 $ — CMOs – agency — 17,304 — Total $ — $ 111,375 $ — December 31, 2021 Assets Available-for-sale securities Mortgage-backed securities – agency $ — $ 120,881 $ — CMOs – agency — 27,503 — Total $ — $ 148,384 $ — There were no transfers between Level 1 and Level 2 during the three and nine months ended September 30, 2022 and 2021. There were no assets at fair value measured on a nonrecurring basis at September 30, 2022. The legacy NFL consumer loan portfolio was measured on a nonrecurring basis and assigned a Level 3 fair value of $14.1 million at December 31, 2021. The following tables present the carrying amounts and fair values (represents exit price) of financial instruments not carried at fair value at September 30, 2022 and December 31, 2021: Fair Value Measurement at September 30, 2022, Using: Carrying Value (Level 1) (Level 2) (Level 3) Total (In thousands) Financial Assets: Cash and cash equivalents $ 182,125 $ 1,217 $ 180,908 $ — $ 182,125 Securities purchased under agreements to resell, at cost 50,225 — — 50,225 50,225 Securities, held-to-maturity 80,102 — 71,436 — 71,436 Securities, restricted, at cost 2,810 N/A N/A N/A N/A Loans held for investment, net 864,229 — — 856,612 856,612 Accrued interest receivable 5,228 — 298 4,728 5,026 Financial Liabilities: Time deposits 18,928 — 18,813 — 18,813 Demand and other deposits 1,168,529 1,168,529 — — 1,168,529 Secured borrowings 47 — 47 — 47 Accrued interest payable 10 — 10 — 10 Fair Value Measurement at December 31, 2021, Using: Carrying Value (Level 1) (Level 2) (Level 3) Total (In thousands) Financial Assets: Cash and cash equivalents $ 149,156 $ 2,202 $ 146,954 $ — $ 149,156 Securities purchased under agreements to resell, at cost 50,271 — — 50,271 50,271 Securities, restricted, at cost 2,680 N/A N/A N/A N/A Loans held for investment, net 775,441 — — 774,114 774,114 Accrued interest receivable 4,197 — 252 3,945 4,197 Financial Liabilities: Time deposits 19,312 — 19,330 — 19,330 Demand and other deposits 1,009,097 1,009,097 — — 1,009,097 Secured borrowings 48 — 48 — 48 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive (Loss) Income | 9 Months Ended |
Sep. 30, 2022 | |
Accumulated Other Comprehensive (Loss) Income | |
Accumulated Other Comprehensive (Loss) Income | NOTE 9 — Accumulated Other Comprehensive Loss The following presents changes in accumulated other comprehensive loss by component, net of tax, for the three and nine months ending September 30, 2022 and 2021: Three Months Ended Nine Months Ended September 30, 2022 2021 2022 2021 (In thousands) Unrealized Losses on Available-for-Sale Securities Beginning balance $ (11,277) $ 323 $ (850) $ 1,408 Other comprehensive loss before reclassifications, net of tax (4,665) (490) (15,092) (1,575) Amounts reclassified from accumulated other comprehensive loss — — — — Net current period other comprehensive loss (4,665) (490) (15,092) (1,575) Ending balance $ (15,942) $ (167) $ (15,942) $ (167) There were no reclassifications out of accumulated other comprehensive loss for the three and nine months ended September 30, 2022 and 2021. |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Basis of Presentation 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, 2021 and 2020. Operating results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022 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. 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 2022 Consolidated Statement of Financial Condition and Consolidated Statement of Income. |
Subsequent Events | Subsequent Events The Company has evaluated events for recognition and disclosure through the date of issuance. |
Investment in Variable Interest Entity | Investment in Variable Interest Entity On April 1, 2022, the Company sold its legacy NFL consumer post-settlement loan portfolio to a variable interest entity (VIE) in exchange for a nonvoting interest valued at $13.5 million where the Company will remain as servicer of the loan portfolio at the discretion of the VIE manager. The Company’s investment is considered a significant variable interest, but it does not have the power to direct the activities that most significantly impact the VIE’s economic performance. Therefore, the Company is not considered the primary beneficiary of this VIE and does not consolidate the entity in the Company’s financial statements. The Company’s maximum exposure to loss is limited to the carrying amount of its investment and accounted for under the equity method which is presented within other assets on the Consolidated Statement of Financial Condition. |
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 held for sale are accounted for at lower of cost or fair value. Net unrealized losses, if any, are recorded as a valuation allowance and charged to earnings. Loans held for sale is included with Other assets on the Consolidated Statement of Financial Condition. |
New Accounting Pronouncements | New Accounting Pronouncements In June 2016, the FASB issued Accounting Standards Update (“ASU”) 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 a smaller reporting company on January 1, 2023. The Company plans to adopt ASU 2016-13 on 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. In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” ASU 2020-04 provides optional expedients and exceptions for accounting related to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met. ASU 2020-04 applies only to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform and do not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022, except for hedging relationships existing as of December 31, 2022, that an entity has elected certain optional expedients for and that are retained through the end of the hedging relationship. ASU 2020-04 was effective upon issuance and generally can be applied through December 31, 2022. Adoption of the standard is not expected to have a material impact on the Company’s operating results or financial condition. In March 2022, the FASB issued ASU 2022-02, “Financial Instruments — Credit Losses (Topic 326): Troubled Debt Restructuring and Vintage Disclosures”. ASU 2022-02 eliminates the accounting guidance for TDRs by creditors in Subtopic 310-40, “Receivables — Troubled Debt Restructurings by Creditors”, while enhancing disclosure requirements for certain loan refinancing and restructurings by creditors when a borrower is experiencing financial difficulty. Additionally, the amendments in this ASU require that public business entities disclose current-period gross write-offs by year of origination for financing receivables and net investments in leases within the scope of ASU 326-20, “Financial Instruments — Credit Losses: Measured at Amortized Cost”. The Company is in the process of evaluating the ASU in conjunction with its adoption of CECL on January 1, 2023. |
Debt Securities (Tables)
Debt Securities (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Debt Securities | |
Schedule of amortized cost, gross unrealized gains and losses and estimated fair value of securities available-for-sale and held to maturity | September 30, 2022 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value (In thousands) Securities available-for-sale: Mortgage-backed securities – agency $ 113,658 $ — $ (19,587) $ 94,071 Collateralized mortgage obligations (CMOs) – agency 19,706 — (2,402) 17,304 Total available-for-sale $ 133,364 $ — $ (21,989) $ 111,375 Gross Gross Amortized Unrecognized Unrecognized Fair Cost Gains Losses Value (In thousands) Securities held-to-maturity: Collateralized mortgage obligations (CMOs) – agency $ 80,102 $ — $ (8,666) $ 71,436 Total held-to-maturity $ 80,102 $ — $ (8,666) $ 71,436 December 31, 2021 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value (In thousands) Securities available-for-sale: Mortgage-backed securities – agency $ 122,258 $ 673 $ (2,050) $ 120,881 Collateralized mortgage obligations (CMOs) – agency 27,316 237 (50) 27,503 Total available-for-sale $ 149,574 $ 910 $ (2,100) $ 148,384 |
Schedule of gross unrealized losses and fair value, securities in continuous unrealized loss position | September 30, 2022 Less Than 12 Months 12 Months or Longer Total Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses (In thousands) Securities available-for-sale: Mortgage-backed securities – agency $ 24,357 $ (3,618) $ 69,714 $ (15,969) $ 94,071 $ (19,587) CMOs – agency 16,315 (2,291) 989 (111) 17,304 (2,402) Total temporarily impaired securities $ 40,672 $ (5,909) $ 70,703 $ (16,080) $ 111,375 $ (21,989) Less Than 12 Months 12 Months or Longer Total Fair Value Gross Unrecognized Losses Fair Value Gross Unrecognized Losses Fair Value Gross Unrecognized Losses (In thousands) Securities held-to-maturity: CMOs – agency $ 71,436 $ (8,666) $ — $ — $ 71,436 $ (8,666) Total temporarily impaired securities $ 71,436 $ (8,666) $ — $ — $ 71,436 $ (8,666) December 31, 2021 Less Than 12 Months 12 Months or Longer Total Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses (In thousands) Securities available-for-sale: Mortgage-backed securities - agency $ 101,235 $ (1,813) $ 4,503 $ (237) $ 105,738 $ (2,050) CMOs - Agency 7,416 (50) — — 7,416 (50) Total temporarily impaired securities $ 108,651 $ (1,863) $ 4,503 $ (237) $ 113,154 $ (2,100) |
Loans (Tables)
Loans (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Loans | |
Schedule of composition of loans | At September 30, At December 31, 2022 2021 (In thousands) Real estate: Multifamily $ 263,689 $ 254,852 Commercial real estate 83,515 48,589 1 – 4 family 31,496 40,753 Construction — — Total real estate 378,700 344,194 Commercial 478,854 432,108 Consumer 18,424 8,681 Total loans held for investment $ 875,978 $ 784,983 Deferred loan fees and unearned premiums, net (864) (466) Allowance for loan losses (10,885) (9,076) Loans held for investment, net $ 864,229 $ 775,441 |
Schedule of activity in allowance for loan losses | Commercial Multifamily Real Estate 1 ‑ 4 Family Construction Commercial Consumer Total (In thousands) September 30, 2022 Allowance for loan losses: Beginning balance $ 1,916 $ 902 $ 253 $ — $ 7,045 $ 155 $ 10,271 Provision (credit) for loan losses 11 35 (15) — 418 201 650 Recoveries — — — — — — — Loans charged-off — — — — — (36) (36) Total ending allowance balance $ 1,927 $ 937 $ 238 $ — $ 7,463 $ 320 $ 10,885 September 30, 2021 Allowance for loan losses: Beginning balance $ 1,418 $ 603 $ 312 $ — $ 5,547 $ 6,137 $ 14,017 Provision (credit) for loan losses 274 (4) (3) — 385 3,098 3,750 Recoveries — — — — — — — Loans charged-off — — — — — (9,102) (9,102) Total ending allowance balance $ 1,692 $ 599 $ 309 $ — $ 5,932 $ 133 $ 8,665 Commercial Multifamily Real Estate 1 ‑ 4 Family Construction Commercial Consumer Total (In thousands) September 30, 2022 Allowance for loan losses: Beginning balance $ 1,789 $ 552 $ 285 $ — $ 6,319 $ 131 $ 9,076 Provision (credit) for loan losses 299 385 (47) — 1,206 297 2,140 Recoveries 17 — — — 2 — 19 Loans charged-off (178) — — — (64) (108) (350) Total ending allowance balance $ 1,927 $ 937 $ 238 $ — $ 7,463 $ 320 $ 10,885 September 30, 2021 Allowance for loan losses: Beginning balance $ 1,278 $ 597 $ 342 $ — $ 5,003 $ 4,182 $ 11,402 Provision (credit) for loan losses 414 2 (33) — 929 5,088 6,400 Recoveries — — — — — — — Loans charged-off — — — — — (9,137) (9,137) Total ending allowance balance $ 1,692 $ 599 $ 309 $ — $ 5,932 $ 133 $ 8,665 Commercial Multifamily Real Estate 1 ‑ 4 Family Construction Commercial Consumer Total (In thousands) September 30, 2022 Allowance for loan losses: Ending allowance balance attributable to loans: Individually evaluated for impairment $ — $ — $ — $ — $ — $ — $ — Collectively evaluated for impairment 1,927 937 238 — 7,463 320 10,885 Total ending allowance balance $ 1,927 $ 937 $ 238 $ — $ 7,463 $ 320 $ 10,885 Loans: Loans individually evaluated for impairment $ — $ — $ — $ — $ 5,819 $ — $ 5,819 Loans collectively evaluated for impairment 263,689 83,515 31,496 — 473,035 18,424 870,159 Total ending loans balance $ 263,689 $ 83,515 $ 31,496 $ — $ 478,854 $ 18,424 $ 875,978 Commercial Multifamily Real Estate 1 ‑ 4 Family Construction Commercial Consumer Total (In thousands) December 31, 2021 Allowance for loan losses: Ending allowance balance attributable to loans: Individually evaluated for impairment $ — $ — $ — $ — $ — $ — $ — Collectively evaluated for impairment 1,789 552 285 — 6,319 131 9,076 Total ending allowance balance $ 1,789 $ 552 $ 285 $ — $ 6,319 $ 131 $ 9,076 Loans: Loans individually evaluated for impairment $ — $ — $ — $ — $ — $ — $ — Loans collectively evaluated for impairment 254,852 48,589 40,753 — 432,108 8,681 784,983 Total ending loans balance $ 254,852 $ 48,589 $ 40,753 $ — $ 432,108 $ 8,681 $ 784,983 |
Schedule of impaired loans by segment | September 30, December 31, 2022 2021 Unpaid Unpaid Recorded Principal Recorded Principal Investment Balance Investment Balance (In thousands) Multifamily $ — $ — $ — $ — Commercial real estate — — — — 1 – 4 family — — — — Construction — — — — Commercial 5,819 5,819 — — Consumer 1 1 — — Total $ 5,820 $ 5,820 $ — $ — |
Schedule of average recorded investment and income recognized on impaired loans | For the Three Months Ended September 30, For the Nine Months Ended September 30, 2022 2021 2022 2021 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) Multifamily $ — $ — $ — $ — $ 206 $ — $ 144 $ — Commercial real estate — — — — — — — — 1 – 4 family — — — — — — — — Construction — — — — — — — — Commercial 1,455 — — — 608 — — — Consumer — — 1,703 — 1 — 2,054 — Total $ 1,455 $ — $ 1,703 $ — $ 815 $ — $ 2,198 $ — |
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, 2022 Multifamily $ — $ — $ — $ — $ — $ 263,689 263,689 Commercial real estate — — — — — 83,515 83,515 1 – 4 family — — — — — 31,496 $ 31,496 Construction — — — — — — — Commercial — — — 5,819 5,819 473,035 478,854 Consumer 18 9 — 1 28 18,396 18,424 Total $ 18 $ 9 $ — $ 5,820 $ 5,847 $ 870,131 $ 875,978 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, 2021 Multifamily $ 1,034 $ — $ — $ — $ 1,034 $ 253,818 $ 254,852 Commercial real estate — — — — — 48,589 48,589 1 – 4 family — — — — — 40,753 40,753 Construction — — — — — — — Commercial — — — — — 432,108 432,108 Consumer 21 10 — 6 37 8,644 8,681 Total $ 1,055 $ 10 $ — $ 6 $ 1,071 $ 783,912 $ 784,983 |
Schedule of risk category of loans | Pass Special Mention Substandard Doubtful (In thousands) September 30, 2022 Multifamily $ 259,595 $ 3,373 $ 721 $ — Commercial real estate 79,697 3,818 — — 1 – 4 family 31,496 — — — Construction — — — — Commercial 466,480 6,555 5,819 — Consumer 16,536 1,888 — — Total $ 853,804 $ 15,634 $ 6,540 $ — Pass Special Mention Substandard Doubtful (In thousands) December 31, 2021 Multifamily $ 254,131 $ — $ 721 $ — Commercial real estate 44,771 3,818 — — 1 – 4 family 37,738 3,015 — — Construction — — — — Commercial 410,548 17,977 3,583 — Consumer 8,681 — — — Total $ 755,869 $ 24,810 $ 4,304 $ — |
Noninterest Income (Tables)
Noninterest Income (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
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, 2022 2021 2022 2021 (In thousands) Payment processing fees Payment processing income $ 5,250 $ 5,021 $ 15,651 $ 15,339 ACH income 208 206 636 609 Customer related fees, service charges and other Administrative service income 886 — 1,512 29 Other 88 81 256 263 Gain (loss) on loans held for sale (1) — (384) 88 (384) Total noninterest income $ 6,432 $ 4,924 $ 18,143 $ 15,856 (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, 2022 | |
Share-Based Payment Plans | |
Schedule of option activity | Weighted Weighted Average Average Remaining Exercise Contractual Options Price Life (Years) September 30, 2022 Outstanding at beginning of year 649,600 $ 16.66 Granted — — Exercised (12,332) 22.79 Forfeited (14,085) 25.20 Expired — — Outstanding at period end 623,183 $ 16.35 4.70 Vested or expected to vest 623,183 $ 16.35 4.70 Exercisable at period end 521,699 $ 14.24 3.90 |
Schedule of information related to stock option exercises | For the Three Months Ended For the Nine Months Ended September 30, September 30, 2022 2021 2022 2021 (In thousands) Intrinsic value of options exercised $ 86 $ 403 $ 166 $ 1,275 Cash received from option exercises 7 — 178 21 Excess tax benefit from option exercises 15 78 15 244 |
Schedule of activity related to restricted stock | Weighted Average Grant Date Shares Fair Value September 30, 2022 Outstanding at beginning of year 482,750 $ 24.59 Granted — — Vested (25,497) 20.44 Forfeited (13,750) 24.31 Outstanding at period end 443,503 $ 24.84 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Earnings per Share | |
Schedule of earnings per share | For the Three Months Ended For the Nine Months Ended September 30, September 30, 2022 2021 2022 2021 (Dollars in thousands, except per share data) Basic Net income $ 7,711 $ 2,519 $ 19,404 $ 11,195 Weighted average shares outstanding 7,637,407 7,460,897 7,628,903 7,445,497 Basic earnings per share $ 1.01 $ 0.34 $ 2.54 $ 1.50 Diluted Net income $ 7,711 $ 2,519 $ 19,404 $ 11,195 Weighted average shares outstanding for basic earnings per share 7,637,407 7,460,897 7,628,903 7,445,497 Add: Dilutive effects of share based awards 588,807 487,145 557,194 448,076 Average shares and dilutive potential shares 8,226,214 7,948,042 8,186,097 7,893,573 Diluted earnings per share $ 0.94 $ 0.32 $ 2.37 $ 1.42 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Leases | |
Schedule of maturities of operating lease liabilities | Operating Lease Liabilities (In thousands) 2022 $ 157 2023 636 2024 652 2025 668 2026 627 Thereafter — Total operating lease payments $ 2,740 Less: interest 176 Present value of operating lease liabilities $ 2,564 |
Schedule of lease assumptions | As of September 30, 2022 2021 Weighted-average remaining lease term 4.17 years 5.12 years Weighted-average discount rate 3.08 % 3.05 % |
Schedule of lease cost | For the Three Months Ended For the Nine Months Ended September 30, 2022 2021 2022 2021 (In thousands) Operating lease cost $ 135 $ 142 $ 419 $ 425 Short-term lease cost — — — 13 Total lease cost $ 135 $ 142 $ 419 $ 438 Cash paid for operating leases $ 162 $ 161 $ 490 $ 503 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Measurements | |
Schedule of assets measured at fair value on a recurring basis | Fair Value Measurements Using Quoted Prices In Active Markets For Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (Level 1) (Level 2) (Level 3) (In thousands) September 30, 2022 Assets Available-for-sale securities Mortgage-backed securities – agency $ — $ 94,071 $ — CMOs – agency — 17,304 — Total $ — $ 111,375 $ — December 31, 2021 Assets Available-for-sale securities Mortgage-backed securities – agency $ — $ 120,881 $ — CMOs – agency — 27,503 — Total $ — $ 148,384 $ — |
Schedule of carrying amounts and fair values of financial instruments | Fair Value Measurement at September 30, 2022, Using: Carrying Value (Level 1) (Level 2) (Level 3) Total (In thousands) Financial Assets: Cash and cash equivalents $ 182,125 $ 1,217 $ 180,908 $ — $ 182,125 Securities purchased under agreements to resell, at cost 50,225 — — 50,225 50,225 Securities, held-to-maturity 80,102 — 71,436 — 71,436 Securities, restricted, at cost 2,810 N/A N/A N/A N/A Loans held for investment, net 864,229 — — 856,612 856,612 Accrued interest receivable 5,228 — 298 4,728 5,026 Financial Liabilities: Time deposits 18,928 — 18,813 — 18,813 Demand and other deposits 1,168,529 1,168,529 — — 1,168,529 Secured borrowings 47 — 47 — 47 Accrued interest payable 10 — 10 — 10 Fair Value Measurement at December 31, 2021, Using: Carrying Value (Level 1) (Level 2) (Level 3) Total (In thousands) Financial Assets: Cash and cash equivalents $ 149,156 $ 2,202 $ 146,954 $ — $ 149,156 Securities purchased under agreements to resell, at cost 50,271 — — 50,271 50,271 Securities, restricted, at cost 2,680 N/A N/A N/A N/A Loans held for investment, net 775,441 — — 774,114 774,114 Accrued interest receivable 4,197 — 252 3,945 4,197 Financial Liabilities: Time deposits 19,312 — 19,330 — 19,330 Demand and other deposits 1,009,097 1,009,097 — — 1,009,097 Secured borrowings 48 — 48 — 48 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive (Loss) Income (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
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, 2022 2021 2022 2021 (In thousands) Unrealized Losses on Available-for-Sale Securities Beginning balance $ (11,277) $ 323 $ (850) $ 1,408 Other comprehensive loss before reclassifications, net of tax (4,665) (490) (15,092) (1,575) Amounts reclassified from accumulated other comprehensive loss — — — — Net current period other comprehensive loss (4,665) (490) (15,092) (1,575) Ending balance $ (15,942) $ (167) $ (15,942) $ (167) |
Business and Summary of Signifi
Business and Summary of Significant Accounting Policies (Details) $ in Millions | Apr. 01, 2022 USD ($) |
Accounting Policies [Line Items] | |
Non-Voting Economic Interest Acquired on Sale of Loan Portfolio | $ 13.5 |
Non-voting economic interest | $ 13.5 |
Debt Securities - Summary of re
Debt Securities - Summary of reconciliation of amortized cost to fair value (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | $ 133,364 | $ 149,574 |
Gross Unrealized Gains | 0 | 910 |
Gross Unrealized Losses | (21,989) | (2,100) |
Fair Value | 111,375 | 148,384 |
Mortgage-backed securities - agency | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 113,658 | 122,258 |
Gross Unrealized Gains | 0 | 673 |
Gross Unrealized Losses | (19,587) | (2,050) |
Fair Value | 94,071 | 120,881 |
CMO's - agency | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 19,706 | 27,316 |
Gross Unrealized Gains | 0 | 237 |
Gross Unrealized Losses | (2,402) | (50) |
Fair Value | $ 17,304 | $ 27,503 |
Debt Securities - Summary of _2
Debt Securities - Summary of reconciliation of amortized cost to fair value for Held to maturity securities (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Schedule of Held-to-maturity Securities [Line Items] | ||
Amortized Cost | $ 80,102 | $ 0 |
Gross Unrecognized Gains | 0 | |
Gross Unrecognized Losses | (8,666) | |
Fair Value | 71,436 | |
CMO's - agency | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Amortized Cost | 80,102 | |
Gross Unrecognized Gains | 0 | |
Gross Unrecognized Losses | (8,666) | |
Fair Value | $ 71,436 |
Debt Securities - Summary of se
Debt Securities - Summary of securities in unrealized loss position (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value, Less than 12 Months | $ 40,672 | $ 108,651 |
Gross Unrealized Losses, Less than 12 Months | (5,909) | (1,863) |
Fair Value, 12 Months or Longer | 70,703 | 4,503 |
Gross Unrealized Losses, 12 Months or Longer | (16,080) | (237) |
Fair Value, Total | 111,375 | 113,154 |
Gross Unrealized Losses, Total | (21,989) | (2,100) |
Mortgage-backed securities - agency | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value, Less than 12 Months | 24,357 | 101,235 |
Gross Unrealized Losses, Less than 12 Months | (3,618) | (1,813) |
Fair Value, 12 Months or Longer | 69,714 | 4,503 |
Gross Unrealized Losses, 12 Months or Longer | (15,969) | (237) |
Fair Value, Total | 94,071 | 105,738 |
Gross Unrealized Losses, Total | (19,587) | (2,050) |
CMO's - agency | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value, Less than 12 Months | 16,315 | 7,416 |
Gross Unrealized Losses, Less than 12 Months | (2,291) | (50) |
Fair Value, 12 Months or Longer | 989 | |
Gross Unrealized Losses, 12 Months or Longer | (111) | |
Fair Value, Total | 17,304 | 7,416 |
Gross Unrealized Losses, Total | $ (2,402) | $ (50) |
Summary of securities in unreal
Summary of securities in unrealized loss position, held to maturity securities (Details) $ in Thousands | Sep. 30, 2022 USD ($) |
Schedule of Held-to-maturity Securities [Line Items] | |
Fair Value, Less than 12 Months | $ 71,436 |
Gross Unrecognized Losses, Less than 12 Months | (8,666) |
Fair Value, Total | 71,436 |
Gross Unrecognized Losses, Total | (8,666) |
CMO's - agency | |
Schedule of Held-to-maturity Securities [Line Items] | |
Fair Value, Less than 12 Months | 71,436 |
Gross Unrecognized Losses, Less than 12 Months | (8,666) |
Fair Value, Total | 71,436 |
Gross Unrecognized Losses, Total | $ (8,666) |
Debt Securities - Additional di
Debt Securities - Additional disclosures (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Sep. 30, 2022 | Dec. 31, 2021 | |
Debt Securities, Available-for-sale [Line Items] | ||||||
Sales or calls of securities | $ 0 | $ 0 | $ 0 | $ 0 | ||
Fair value of pledged securities | $ 2,810 | $ 2,680 | ||||
Impairment charges | $ 0 | $ 0 | $ 0 | $ 0 | ||
Federal Home Loan Bank Advances | ||||||
Debt Securities, Available-for-sale [Line Items] | ||||||
Short-term debt | 0 | 0 | ||||
Federal Reserve Bank Advances | ||||||
Debt Securities, Available-for-sale [Line Items] | ||||||
Short-term debt | 0 | 0 | ||||
Federal Reserve Bank of New York (FRB) | ||||||
Debt Securities, Available-for-sale [Line Items] | ||||||
Fair value of pledged securities | 37,700 | 26,900 | ||||
Securities pledged borrowed amount | 36,600 | 26,100 | ||||
Federal Home Loan Bank of New York (FHLB) | ||||||
Debt Securities, Available-for-sale [Line Items] | ||||||
Fair value of pledged securities | 153,800 | 121,500 | ||||
Securities pledged borrowed amount | $ 139,000 | $ 115,400 |
Loans - Summary of loan composi
Loans - Summary of loan composition (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 |
Loans and Leases Receivable Disclosure [Line Items] | ||||||
Total loans held for investment | $ 875,978 | $ 784,983 | ||||
Deferred loan fees and unearned premiums, net | (864) | (466) | ||||
Allowance for loan losses | (10,885) | $ (10,271) | (9,076) | $ (8,665) | $ (14,017) | $ (11,402) |
Loans held for investment, net | 864,229 | 775,441 | ||||
Real Estate | ||||||
Loans and Leases Receivable Disclosure [Line Items] | ||||||
Total loans held for investment | 378,700 | 344,194 | ||||
Real Estate | 1 - 4 Family Residential | ||||||
Loans and Leases Receivable Disclosure [Line Items] | ||||||
Total loans held for investment | 31,496 | 40,753 | ||||
Allowance for loan losses | (238) | (253) | (285) | (309) | (312) | (342) |
Real Estate | Multifamily | ||||||
Loans and Leases Receivable Disclosure [Line Items] | ||||||
Total loans held for investment | 263,689 | 254,852 | ||||
Allowance for loan losses | (1,927) | (1,916) | (1,789) | (1,692) | (1,418) | (1,278) |
Real Estate | Commercial Real Estate | ||||||
Loans and Leases Receivable Disclosure [Line Items] | ||||||
Total loans held for investment | 83,515 | 48,589 | ||||
Allowance for loan losses | (937) | (902) | (552) | (599) | (603) | (597) |
Commercial Segment | ||||||
Loans and Leases Receivable Disclosure [Line Items] | ||||||
Total loans held for investment | 478,854 | 432,108 | ||||
Allowance for loan losses | (7,463) | (7,045) | (6,319) | (5,932) | (5,547) | (5,003) |
Commercial Segment | SBA paycheck protection program loans | ||||||
Loans and Leases Receivable Disclosure [Line Items] | ||||||
Total loans held for investment | 0 | 4,200 | ||||
Consumer | ||||||
Loans and Leases Receivable Disclosure [Line Items] | ||||||
Total loans held for investment | 18,424 | 8,681 | ||||
Allowance for loan losses | $ (320) | $ (155) | $ (131) | $ (133) | $ (6,137) | $ (4,182) |
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, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Allowance for loan losses: | ||||
Beginning balance | $ 9,076 | $ 11,402 | ||
Provision (credit) for loan losses | $ 650 | $ 3,750 | 2,140 | 6,400 |
Recoveries | 0 | 0 | 19 | |
Loans charged-off | (36) | (9,102) | (350) | (9,137) |
Total ending allowance balance | 10,885 | 8,665 | 10,885 | 8,665 |
Real Estate | 1 - 4 Family Residential | ||||
Allowance for loan losses: | ||||
Beginning balance | 285 | 342 | ||
Provision (credit) for loan losses | (15) | (3) | (47) | (33) |
Recoveries | 0 | 0 | ||
Loans charged-off | 0 | 0 | ||
Total ending allowance balance | 238 | 309 | 238 | 309 |
Real Estate | Multifamily | ||||
Allowance for loan losses: | ||||
Beginning balance | 1,789 | 1,278 | ||
Provision (credit) for loan losses | 11 | 274 | 299 | 414 |
Recoveries | 0 | 0 | 17 | |
Loans charged-off | 0 | 0 | (178) | |
Total ending allowance balance | 1,927 | 1,692 | 1,927 | 1,692 |
Real Estate | Commercial Real Estate | ||||
Allowance for loan losses: | ||||
Beginning balance | 552 | 597 | ||
Provision (credit) for loan losses | 35 | (4) | 385 | 2 |
Recoveries | 0 | 0 | ||
Loans charged-off | 0 | 0 | ||
Total ending allowance balance | 937 | 599 | 937 | 599 |
Real Estate | Construction | ||||
Allowance for loan losses: | ||||
Recoveries | 0 | 0 | ||
Loans charged-off | 0 | 0 | ||
Commercial Segment | ||||
Allowance for loan losses: | ||||
Beginning balance | 6,319 | 5,003 | ||
Provision (credit) for loan losses | 418 | 385 | 1,206 | 929 |
Recoveries | 0 | 0 | 2 | |
Loans charged-off | 0 | 0 | (64) | |
Total ending allowance balance | 7,463 | 5,932 | 7,463 | 5,932 |
Consumer | ||||
Allowance for loan losses: | ||||
Beginning balance | 131 | 4,182 | ||
Provision (credit) for loan losses | 201 | 3,098 | 297 | 5,088 |
Recoveries | 0 | 0 | ||
Loans charged-off | (36) | (9,102) | (108) | (9,137) |
Total ending allowance balance | $ 320 | $ 133 | $ 320 | $ 133 |
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, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 |
Ending allowance balance attributable to loans: | ||||||
Individually evaluated for impairment | $ 0 | $ 0 | ||||
Collectively evaluated for impairment | 10,885 | 9,076 | ||||
Total ending allowance balance | 10,885 | $ 10,271 | 9,076 | $ 8,665 | $ 14,017 | $ 11,402 |
Loans: | ||||||
Loans individually evaluated for impairment | 5,819 | 0 | ||||
Loans collectively evaluated for impairment | 870,159 | 784,983 | ||||
Total ending loans balance | 875,978 | 784,983 | ||||
Real Estate | ||||||
Loans: | ||||||
Total ending loans balance | 378,700 | 344,194 | ||||
Real Estate | 1 - 4 Family Residential | ||||||
Ending allowance balance attributable to loans: | ||||||
Individually evaluated for impairment | 0 | 0 | ||||
Collectively evaluated for impairment | 238 | 285 | ||||
Total ending allowance balance | 238 | 253 | 285 | 309 | 312 | 342 |
Loans: | ||||||
Loans individually evaluated for impairment | 0 | 0 | ||||
Loans collectively evaluated for impairment | 31,496 | 40,753 | ||||
Total ending loans balance | 31,496 | 40,753 | ||||
Real Estate | Multifamily | ||||||
Ending allowance balance attributable to loans: | ||||||
Individually evaluated for impairment | 0 | 0 | ||||
Collectively evaluated for impairment | 1,927 | 1,789 | ||||
Total ending allowance balance | 1,927 | 1,916 | 1,789 | 1,692 | 1,418 | 1,278 |
Loans: | ||||||
Loans individually evaluated for impairment | 0 | 0 | ||||
Loans collectively evaluated for impairment | 263,689 | 254,852 | ||||
Total ending loans balance | 263,689 | 254,852 | ||||
Real Estate | Commercial Real Estate | ||||||
Ending allowance balance attributable to loans: | ||||||
Individually evaluated for impairment | 0 | 0 | ||||
Collectively evaluated for impairment | 937 | 552 | ||||
Total ending allowance balance | 937 | 902 | 552 | 599 | 603 | 597 |
Loans: | ||||||
Loans individually evaluated for impairment | 0 | 0 | ||||
Loans collectively evaluated for impairment | 83,515 | 48,589 | ||||
Total ending loans balance | 83,515 | 48,589 | ||||
Real Estate | Construction | ||||||
Ending allowance balance attributable to loans: | ||||||
Individually evaluated for impairment | 0 | 0 | ||||
Loans: | ||||||
Loans individually evaluated for impairment | 0 | 0 | ||||
Commercial Segment | ||||||
Ending allowance balance attributable to loans: | ||||||
Individually evaluated for impairment | 0 | 0 | ||||
Collectively evaluated for impairment | 7,463 | 6,319 | ||||
Total ending allowance balance | 7,463 | 7,045 | 6,319 | 5,932 | 5,547 | 5,003 |
Loans: | ||||||
Loans individually evaluated for impairment | 5,819 | 0 | ||||
Loans collectively evaluated for impairment | 473,035 | 432,108 | ||||
Total ending loans balance | 478,854 | 432,108 | ||||
Consumer | ||||||
Ending allowance balance attributable to loans: | ||||||
Individually evaluated for impairment | 0 | 0 | ||||
Collectively evaluated for impairment | 320 | 131 | ||||
Total ending allowance balance | 320 | $ 155 | 131 | $ 133 | $ 6,137 | $ 4,182 |
Loans: | ||||||
Loans individually evaluated for impairment | 0 | 0 | ||||
Loans collectively evaluated for impairment | 18,424 | 8,681 | ||||
Total ending loans balance | $ 18,424 | $ 8,681 |
Loans - Summary of impaired loa
Loans - Summary of impaired loans by segment (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Financing Receivable, Impaired [Line Items] | ||||
Allowance recorded on impaired loans | $ 0 | $ 0 | ||
Recorded Investment | 5,820,000 | 5,820,000 | ||
Unpaid Principal Balance | 5,820,000 | 5,820,000 | ||
Average Recorded Investment | 1,455,000 | $ 1,703,000 | 815,000 | $ 2,198,000 |
1 - 4 Family Residential | ||||
Financing Receivable, Impaired [Line Items] | ||||
Average Recorded Investment | 206,000 | 144,000 | ||
Commercial | ||||
Financing Receivable, Impaired [Line Items] | ||||
Recorded Investment | 5,819,000 | 5,819,000 | ||
Unpaid Principal Balance | 5,819,000 | 5,819,000 | ||
Construction | ||||
Financing Receivable, Impaired [Line Items] | ||||
Average Recorded Investment | 1,455,000 | 608,000 | ||
Consumer | ||||
Financing Receivable, Impaired [Line Items] | ||||
Recorded Investment | 1,000 | 1,000 | ||
Unpaid Principal Balance | $ 1,000 | 1,000 | ||
Average Recorded Investment | $ 1,703,000 | $ 1,000 | $ 2,054,000 |
Loans - Summary of loans by pas
Loans - Summary of loans by past due status (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Nonaccrual Loans | $ 5,820 | $ 6 |
Total Past Due & Nonaccrual Loans | 5,847 | 1,071 |
Loans Not Past Due | 870,131 | 783,912 |
Total loans held for investment | 875,978 | 784,983 |
30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 18 | 1,055 |
60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 9 | 10 |
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 | 378,700 | 344,194 |
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 | 31,496 | 40,753 |
Total loans held for investment | 31,496 | 40,753 |
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 | 1,034 |
Loans Not Past Due | 263,689 | 253,818 |
Total loans held for investment | 263,689 | 254,852 |
Real Estate | Multifamily | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 1,034 |
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 | 83,515 | 48,589 |
Total loans held for investment | 83,515 | 48,589 |
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 Segment | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Nonaccrual Loans | 5,819 | |
Total Past Due & Nonaccrual Loans | 5,819 | 0 |
Loans Not Past Due | 473,035 | 432,108 |
Total loans held for investment | 478,854 | 432,108 |
Commercial Segment | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Commercial Segment | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 0 | 0 |
Commercial Segment | 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 | 1 | 6 |
Total Past Due & Nonaccrual Loans | 28 | 37 |
Loans Not Past Due | 18,396 | 8,644 |
Total loans held for investment | 18,424 | 8,681 |
Consumer | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 18 | 21 |
Consumer | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due & Nonaccrual Loans | 9 | 10 |
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 | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 item | Jun. 30, 2021 item | Jun. 30, 2022 item | Jun. 30, 2021 item | Sep. 30, 2022 USD ($) item | Dec. 31, 2021 USD ($) item | |
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | $ 875,978 | $ 784,983 | ||||
Number of loans identified as troubled debt restructuring | item | 0 | 0 | ||||
Number of loans modified | item | 0 | 0 | 0 | 0 | ||
Federal Reserve Bank Advances | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Loans pledged | $ 25,400 | $ 33,900 | ||||
Federal Reserve Bank of New York (FRB) | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Maximum borrowing capacity | 20,000 | 26,000 | ||||
Pass | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 853,804 | 755,869 | ||||
Special Mention | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 15,634 | 24,810 | ||||
Substandard | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 6,540 | 4,304 | ||||
Doubtful | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 0 | 0 | ||||
Real Estate | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 378,700 | 344,194 | ||||
Real Estate | 1 - 4 Family Residential | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 31,496 | 40,753 | ||||
Real Estate | 1 - 4 Family Residential | Pass | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 31,496 | 37,738 | ||||
Real Estate | 1 - 4 Family Residential | Special Mention | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 0 | 3,015 | ||||
Real Estate | 1 - 4 Family Residential | Substandard | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 0 | 0 | ||||
Real Estate | 1 - 4 Family Residential | Doubtful | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 0 | 0 | ||||
Real Estate | Multifamily | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 263,689 | 254,852 | ||||
Real Estate | Multifamily | Pass | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 259,595 | 254,131 | ||||
Real Estate | Multifamily | Special Mention | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 3,373 | 0 | ||||
Real Estate | Multifamily | Substandard | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 721 | 721 | ||||
Real Estate | Multifamily | Doubtful | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 0 | 0 | ||||
Real Estate | Commercial Real Estate | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 83,515 | 48,589 | ||||
Real Estate | Commercial Real Estate | Pass | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 79,697 | 44,771 | ||||
Real Estate | Commercial Real Estate | Special Mention | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 3,818 | 3,818 | ||||
Real Estate | Commercial Real Estate | Substandard | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 0 | 0 | ||||
Real Estate | Commercial Real Estate | Doubtful | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 0 | 0 | ||||
Real Estate | Construction | Special Mention | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 0 | 0 | ||||
Real Estate | Construction | Substandard | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 0 | 0 | ||||
Real Estate | Construction | Doubtful | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 0 | 0 | ||||
Commercial Segment | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 478,854 | 432,108 | ||||
Commercial Segment | Pass | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 466,480 | 410,548 | ||||
Commercial Segment | Special Mention | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 6,555 | 17,977 | ||||
Commercial Segment | Substandard | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 5,819 | 3,583 | ||||
Commercial Segment | Doubtful | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 0 | 0 | ||||
Consumer | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 18,424 | 8,681 | ||||
Consumer | Pass | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 16,536 | 8,681 | ||||
Consumer | Special Mention | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 1,888 | 0 | ||||
Consumer | Substandard | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | 0 | 0 | ||||
Consumer | Doubtful | ||||||
Financing Receivable, Recorded Investment [Line Items] | ||||||
Total loans held for investment | $ 0 | $ 0 |
Noninterest Income (Details)
Noninterest Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Noninterest income | ||||
Gain on loans held for sale | $ (384) | $ 88 | $ (384) | |
Total non-interest income | $ 6,432 | 4,924 | 18,143 | 15,856 |
Payment processing income | ||||
Noninterest income | ||||
Noninterest income | 5,250 | 5,021 | 15,651 | 15,339 |
ACH income | ||||
Noninterest income | ||||
Noninterest income | 208 | 206 | 636 | 609 |
Administrative service income | ||||
Noninterest income | ||||
Noninterest income | 886 | 1,512 | 29 | |
Other | ||||
Noninterest income | ||||
Noninterest income | $ 88 | $ 81 | $ 256 | $ 263 |
Share-Based Payment Plans - (De
Share-Based Payment Plans - (Details) | 9 Months Ended |
Sep. 30, 2022 | |
Stock Options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Contractual term of awards | 10 years |
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% |
Share-Based Payment Plans - Sum
Share-Based Payment Plans - Summary of options activity (Details) - Stock Options - $ / shares | 3 Months Ended | 6 Months Ended | 9 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Sep. 30, 2022 | |
Options | |||||
Outstanding at beginning of year | 649,600 | 649,600 | |||
Granted | 0 | 0 | 0 | 0 | 0 |
Exercised | (12,332) | ||||
Forfeited | (14,085) | ||||
Outstanding at period end | 623,183 | ||||
Vested or expected to vest | 623,183 | ||||
Exercisable at period end | 521,699 | ||||
Weighted Average Exercise Price | |||||
Outstanding at beginning of year | $ 16.66 | $ 16.66 | |||
Granted | 0 | ||||
Exercised | 22.79 | ||||
Forfeited | 25.20 | ||||
Outstanding at period end | 16.35 | ||||
Vested or expected to vest | 16.35 | ||||
Exercisable at period end | $ 14.24 | ||||
Weighted Average Remaining Contractual Life (Years), outstanding at period end | 4 years 8 months 12 days | ||||
Weighted Average Remaining Contractual Life (Years), vested or expected to vest | 4 years 8 months 12 days | ||||
Weighted Average Remaining Contractual Life (Years), exercisable at period end | 3 years 10 months 24 days |
Share-Based Payment Plans - S_2
Share-Based Payment Plans - Summary of restricted stock activity (Details) - Restricted stock | 9 Months Ended |
Sep. 30, 2022 $ / shares shares | |
Shares | |
Outstanding at beginning of year | shares | 482,750 |
Vested | shares | (25,497) |
Forfeited | shares | (13,750) |
Outstanding at period end | shares | 443,503 |
Weighted Average Grant Date Fair Value | |
Outstanding at beginning of year | $ / shares | $ 24.59 |
Vested | $ / shares | 20.44 |
Forfeited | $ / shares | 24.31 |
Outstanding at period end | $ / shares | $ 24.84 |
Share-Based Payment Plans - Add
Share-Based Payment Plans - Additional disclosures (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | |||||
Sep. 30, 2022 | Jun. 30, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Cash received from option exercises | $ 178 | $ 21 | ||||||
Stock Options | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of stock options issued | 0 | 0 | 0 | 0 | 0 | |||
Stock options expense | $ 112 | $ 117 | $ 347 | 380 | ||||
Unrecognized compensation cost related to non-vested options | 788,000 | $ 788,000 | ||||||
Recognition period of nonvested stock options | 1 year 10 months 13 days | |||||||
Intrinsic value of outstanding options | 13,200 | $ 13,200 | ||||||
Intrinsic value of exercisable options | 12,200 | 12,200 | ||||||
Intrinsic value of options exercised | 86 | 403 | 166 | 1,275 | ||||
Cash received from option exercises | 7 | 178 | 21 | |||||
Excess tax benefit from option exercises | 15 | 78 | 15 | 244 | ||||
Restricted stock | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Stock options expense | 574 | $ 365 | 1,500 | $ 1,100 | ||||
Unrecognized compensation cost related to non-vested options | $ 6,700 | $ 6,700 | ||||||
Recognition period of nonvested stock options | 4 years 5 months 23 days |
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, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Basic | ||||
Net income | $ 7,711 | $ 2,519 | $ 19,404 | $ 11,195 |
Weighted average shares outstanding for basic earnings per share | 7,637,407 | 7,460,897 | 7,628,903 | 7,445,497 |
Basic earnings per share (in dollars per share) | $ 1.01 | $ 0.34 | $ 2.54 | $ 1.50 |
Diluted | ||||
Net income | $ 7,711 | $ 2,519 | $ 19,404 | $ 11,195 |
Weighted average shares outstanding for basic earnings per share | 7,637,407 | 7,460,897 | 7,628,903 | 7,445,497 |
Add: Dilutive effects of share based awards | 588,807 | 487,145 | 557,194 | 448,076 |
Average shares and dilutive potential shares | 8,226,214 | 7,948,042 | 8,186,097 | 7,893,573 |
Diluted earnings per share (in dollars per share) | $ 0.94 | $ 0.32 | $ 2.37 | $ 1.42 |
Stock options and restricted shares not considered in computing diluted earnings per share because they were anti-dilutive | 61,900 | 107,600 | 65,367 | 107,600 |
Leases (Details)
Leases (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Leases | ||
ROU lease assets | $ 2,000 | $ 2,400 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Other Assets | Other Assets |
lease liability | $ 2,564 | $ 3,000 |
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, 2022 | Dec. 31, 2021 |
Maturities of operating lease liabilities | ||
2022 | $ 157 | |
2023 | 636 | |
2024 | 652 | |
2025 | 668 | |
2026 | 627 | |
Total lease payments | 2,740 | |
Less: interest | 176 | |
Present value of operating lease liabilities | $ 2,564 | $ 3,000 |
Leases - Lease Cost (Details)
Leases - Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Lease cost | ||||
Weighted-average remaining lease term | 4 years 2 months 1 day | 5 years 1 month 13 days | 4 years 2 months 1 day | 5 years 1 month 13 days |
Weighted-average discount rate | 3.08% | 3.05% | 3.08% | 3.05% |
Operating lease cost | $ 135 | $ 142 | $ 419 | $ 425 |
Short-term Lease, Cost | 13 | |||
Total lease cost | 135 | 142 | 419 | 438 |
Cash paid for operating lease liability | $ 162 | $ 161 | $ 490 | $ 503 |
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, 2022 | Jun. 30, 2022 | Dec. 31, 2021 | Jun. 30, 2021 |
Available-for-sale securities | ||||
Securities available-for-sale, at fair value | $ 111,375 | $ 148,384 | ||
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 | 94,071 | 120,881 | ||
CMO's - agency | ||||
Available-for-sale securities | ||||
Securities available-for-sale, at fair value | 17,304 | 27,503 | ||
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 | 111,375 | 148,384 | ||
Recurring | (Level 2) | Mortgage-backed securities - agency | ||||
Available-for-sale securities | ||||
Securities available-for-sale, at fair value | 94,071 | 120,881 | ||
Recurring | (Level 2) | CMO's - agency | ||||
Available-for-sale securities | ||||
Securities available-for-sale, at fair value | 17,304 | 27,503 | ||
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 Millions | Apr. 01, 2022 | Dec. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Non-Voting Economic Interest Acquired on Sale of Loan Portfolio | $ 13.5 | |
(Level 3) | NFL Portfolio | Non-recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Non-Voting Economic Interest Acquired on Sale of Loan Portfolio | $ 14.1 |
Fair Value Measurements - Sum_2
Fair Value Measurements - Summary of estimated fair values of financial instruments (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Financial Assets: | ||
Securities purchased under agreements to resell, at cost | $ 50,225 | $ 50,271 |
Securities available for sale | 111,375 | 148,384 |
Securities, held to maturity | 80,102 | 0 |
Securities, restricted, at cost | 2,810 | 2,680 |
Loans held for investment, net | 864,229 | 775,441 |
Accrued interest receivable | 5,228 | 4,197 |
Financial Liabilities: | ||
Time deposits | 18,928 | 19,312 |
Carrying Value | ||
Financial Assets: | ||
Cash and cash equivalents | 182,125 | 149,156 |
Securities purchased under agreements to resell, at cost | 50,225 | 50,271 |
Securities, held to maturity | 80,102 | |
Securities, restricted, at cost | 2,810 | 2,680 |
Loans held for investment, net | 864,229 | 775,441 |
Accrued interest receivable | 5,228 | 4,197 |
Financial Liabilities: | ||
Time deposits | 18,928 | 19,312 |
Demand and other deposits | 1,168,529 | 1,009,097 |
Secured borrowings | 47 | 48 |
Accrued interest payable | 10 | |
Fair Value | ||
Financial Assets: | ||
Cash and cash equivalents | 182,125 | 149,156 |
Securities purchased under agreements to resell, at cost | 50,225 | 50,271 |
Securities, held to maturity | 71,436 | |
Loans held for investment, net | 856,612 | 774,114 |
Accrued interest receivable | 5,026 | 4,197 |
Financial Liabilities: | ||
Time deposits | 18,813 | 19,330 |
Demand and other deposits | 1,168,529 | 1,009,097 |
Secured borrowings | 47 | 48 |
Accrued interest payable | 10 | |
Fair Value | (Level 1) | ||
Financial Assets: | ||
Cash and cash equivalents | 1,217 | 2,202 |
Loans held for investment, net | 0 | 0 |
Accrued interest receivable | 0 | 0 |
Financial Liabilities: | ||
Time deposits | 0 | |
Demand and other deposits | 1,168,529 | 1,009,097 |
Secured borrowings | 0 | 0 |
Accrued interest payable | 0 | |
Fair Value | (Level 2) | ||
Financial Assets: | ||
Cash and cash equivalents | 180,908 | 146,954 |
Securities, held to maturity | 71,436 | |
Loans held for investment, net | 0 | 0 |
Accrued interest receivable | 298 | 252 |
Financial Liabilities: | ||
Time deposits | 18,813 | 19,330 |
Demand and other deposits | 0 | 0 |
Secured borrowings | 47 | 48 |
Accrued interest payable | 10 | |
Fair Value | (Level 3) | ||
Financial Assets: | ||
Cash and cash equivalents | 0 | 0 |
Securities purchased under agreements to resell, at cost | 50,225 | 50,271 |
Loans held for investment, net | 856,612 | 774,114 |
Accrued interest receivable | 4,728 | 3,945 |
Financial Liabilities: | ||
Time deposits | 0 | |
Demand and other deposits | 0 | 0 |
Secured borrowings | 0 | $ 0 |
Accrued interest payable | $ 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 | 6 Months Ended | 9 Months Ended | |||||
Sep. 30, 2022 | Jun. 30, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Unrealized (Losses) Gains on Available-for-Sale Securities | ||||||||
Beginning balance | $ (11,277) | $ 323 | $ (850) | $ 1,408 | $ (850) | $ 1,408 | ||
Other comprehensive loss before reclassifications, net of tax | $ (4,665) | $ (490) | (15,092) | (1,575) | ||||
Amounts reclassified from accumulated other comprehensive income | 0 | 0 | 0 | 0 | ||||
Net current period other comprehensive loss | (4,665) | (490) | (15,092) | (1,575) | ||||
Ending balance | $ (15,942) | $ (167) | $ (15,942) | $ (167) | ||||
Reclassifications | $ 0 | $ 0 | $ 0 | $ 0 |