Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Mar. 17, 2017 | Jun. 30, 2016 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | Sound Financial Bancorp, Inc. | ||
Entity Central Index Key | 1,541,119 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $ 52.1 | ||
Entity Common Stock, Shares Outstanding | 2,499,880 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2016 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
ASSETS | ||
Cash and cash equivalents | $ 54,582 | $ 48,264 |
Available-for-sale securities, at fair value | 6,604 | 6,696 |
Loans held-for-sale | 871 | 2,091 |
Loans | 500,001 | 459,469 |
Allowance for loan losses | (4,822) | (4,636) |
Total loans, net | 495,179 | 454,833 |
Accrued interest receivable | 1,816 | 1,608 |
Bank-owned life insurance, net | 12,082 | 11,746 |
Other real estate owned ("OREO") and repossessed assets, net | 1,172 | 769 |
Mortgage servicing rights, at fair value | 3,561 | 3,249 |
Federal Home Loan Bank ("FHLB") stock, at cost | 2,840 | 2,212 |
Premises and equipment, net | 5,549 | 5,335 |
Other assets | 4,127 | 3,957 |
Total assets | 588,383 | 540,760 |
Deposits | ||
Interest-bearing | 403,990 | 389,151 |
Noninterest-bearing demand | 63,741 | 50,873 |
Total deposits | 467,731 | 440,024 |
Borrowings | 54,792 | 40,435 |
Accrued interest payable | 73 | 72 |
Other liabilities | 4,874 | 5,140 |
Advance payments from borrowers for taxes and insurance | 638 | 569 |
Total liabilities | 528,108 | 486,240 |
COMMITMENTS AND CONTINGENCIES (NOTE 17) | ||
STOCKHOLDERS' EQUITY | ||
Preferred stock, $0.01 par value, 1,000,000 shares authorized, none issued or outstanding | 0 | 0 |
Common stock, $0.01 par value, 40,000,000 shares authorized, 2,498,804 and 2,469,206 issued and outstanding as of December 31, 2016 and 2015, respectively | 25 | 25 |
Additional paid-in capital | 23,979 | 23,002 |
Unearned shares - Employee Stock Ownership Plan ("ESOP") | (683) | (911) |
Retained earnings | 36,873 | 32,240 |
Accumulated other comprehensive income, net of tax | 81 | 164 |
Total stockholders' equity | 60,275 | 54,520 |
Total liabilities and stockholders' equity | $ 588,383 | $ 540,760 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2016 | Dec. 31, 2015 |
STOCKHOLDERS' EQUITY | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 40,000,000 | 40,000,000 |
Common stock, shares issued (in shares) | 2,498,804 | 2,469,206 |
Common stock, shares outstanding (in shares) | 2,498,804 | 2,469,206 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
INTEREST INCOME | ||
Loans, including fees | $ 24,608 | $ 22,233 |
Interest and dividends on investments, cash and cash equivalents | 442 | 220 |
Total interest income | 25,050 | 22,453 |
INTEREST EXPENSE | ||
Deposits | 2,708 | 2,646 |
Borrowings | 211 | 106 |
Total interest expense | 2,919 | 2,752 |
Net interest income | 22,131 | 19,701 |
PROVISION FOR LOAN LOSSES | 454 | 400 |
Net interest income after provision for loan losses | 21,677 | 19,301 |
NONINTEREST INCOME | ||
Service charges and fee income | 2,508 | 2,605 |
Earnings on cash surrender value of bank-owned life insurance | 336 | 338 |
Mortgage servicing income | 956 | 840 |
Fair value adjustment on mortgage servicing rights | (49) | 210 |
Loss on sale of securities | 0 | (31) |
Net gain on sale of loans | 1,366 | 1,301 |
Total noninterest income | 5,117 | 5,263 |
NONINTEREST EXPENSE | ||
Salaries and benefits | 10,505 | 9,223 |
Operations | 4,361 | 3,995 |
Regulatory assessments | 539 | 746 |
Occupancy | 1,526 | 1,493 |
Data processing | 1,784 | 1,717 |
Net loss and expenses on OREO and repossessed assets | 6 | 311 |
Total noninterest expense | 18,721 | 17,485 |
Income before provision for income taxes | 8,073 | 7,079 |
Provision for income taxes | 2,695 | 2,289 |
Net income | $ 5,378 | $ 4,790 |
Earnings per common share: | ||
Basic (in dollars per share) | $ 2.16 | $ 1.92 |
Diluted (in dollars per share) | $ 2.09 | $ 1.86 |
Weighted average number of common shares outstanding: | ||
Basic (in shares) | 2,486,936 | 2,491,683 |
Diluted (in shares) | 2,566,980 | 2,579,575 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Consolidated Statements of Comprehensive Income [Abstract] | ||
Net income | $ 5,378 | $ 4,790 |
Available for sale securities: | ||
Reclassification adjustment for loss on sale of securities, net of taxes of $0, and $11, respectively | 0 | 20 |
Unrealized losses arising during the year, net of taxes of $(28) and $(13), respectively | (83) | (39) |
Other comprehensive loss, net of tax | (83) | (19) |
Comprehensive income | $ 5,295 | $ 4,771 |
Consolidated Statements of Com6
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Available for sale securities: | ||
Reclassification adjustment for loss on sale of securities, taxes | $ 0 | $ 11 |
Unrealized losses arising during the year, taxes | $ (28) | $ (13) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Unearned ESOP Shares [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss), Net of Tax [Member] | Total |
Balances at Dec. 31, 2014 | $ 25 | $ 23,552 | $ (1,140) | $ 28,024 | $ 183 | $ 50,644 |
Balances (in shares) at Dec. 31, 2014 | 2,515,664 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 4,790 | 4,790 | ||||
Other comprehensive loss, net of tax | (19) | (19) | ||||
Share-based compensation | 418 | 418 | ||||
Restricted stock awards | 0 | |||||
Restricted stock awards (in shares) | 10,208 | |||||
Cash dividends paid on common stock | (574) | (574) | ||||
Common stock repurchased | (1,261) | (1,261) | ||||
Common stock repurchased (in shares) | (63,371) | |||||
Restricted shares forfeited | 0 | |||||
Restricted shares forfeited (in shares) | (482) | |||||
Stock options exercised | 65 | 65 | ||||
Stock options exercised (in shares) | 7,187 | |||||
Allocation of ESOP shares | 228 | 229 | 457 | |||
Balances at Dec. 31, 2015 | $ 25 | 23,002 | (911) | 32,240 | 164 | $ 54,520 |
Balances (in shares) at Dec. 31, 2015 | 2,469,206 | 2,469,206 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 5,378 | $ 5,378 | ||||
Other comprehensive loss, net of tax | (83) | (83) | ||||
Share-based compensation | 525 | 525 | ||||
Restricted stock awards | 0 | |||||
Restricted stock awards (in shares) | 11,606 | |||||
Cash dividends paid on common stock | (745) | (745) | ||||
Common stock surrendered | 0 | |||||
Common stock surrendered (in shares) | (2,805) | |||||
Restricted shares forfeited | 0 | |||||
Restricted shares forfeited (in shares) | (1,059) | |||||
Stock options exercised | 165 | 165 | ||||
Stock options exercised (in shares) | 21,856 | |||||
Allocation of ESOP shares | 287 | 228 | 515 | |||
Balances at Dec. 31, 2016 | $ 25 | $ 23,979 | $ (683) | $ 36,873 | $ 81 | $ 60,275 |
Balances (in shares) at Dec. 31, 2016 | 2,498,804 | 2,498,804 |
Consolidated Statements of Sto8
Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Cash dividends on common stock (in dollars per share) | $ 0.30 | $ 0.20 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 5,378 | $ 4,790 |
Adjustments to reconcile net income to net cash from operating activities: | ||
Accretion of net premium on investments | 48 | 102 |
Loss on sale of securities | 0 | 31 |
Provision for loan losses | 454 | 400 |
Depreciation and amortization | 793 | 620 |
Compensation expense related to stock options and restricted stock | 525 | 418 |
Net change to mortgage servicing rights | (312) | (221) |
Increase in cash surrender value of bank-owned life insurance | (336) | (338) |
Deferred income tax | (23) | (359) |
Gain on sale of loans | (1,366) | (1,301) |
Proceeds from sale of loans held-for-sale | 88,926 | 73,951 |
Originations of loans held-for-sale | (86,340) | (73,931) |
(Gain) loss on sale of other real estate owned and repossessed assets | (21) | 201 |
Change in operating assets and liabilities: | ||
Accrued interest receivable | (208) | (111) |
Other assets | (105) | (31) |
Accrued interest payable | 1 | (4) |
Other liabilities | (266) | (466) |
Net cash from operating activities | 7,148 | 3,751 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Proceeds from principal payments, maturities and sales of available for sale securities | 1,282 | 4,665 |
Purchases of available for sale securities | (1,363) | 0 |
FHLB stock (purchased) redeemed | (628) | 12 |
Net increase in loans | (41,434) | (29,931) |
Proceeds from sale of OREO and other repossessed assets | 252 | 736 |
Purchases of premises and equipment, net | (1,007) | (1,112) |
Net cash used by investing activities | (42,898) | (25,630) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Net increase in deposits | 27,707 | 32,215 |
Proceeds from borrowings | 151,500 | 107,000 |
Repayment of borrowings | (137,143) | (97,143) |
Net change in advances from borrowers for taxes and insurance | 69 | 95 |
ESOP shares released | 515 | 457 |
Common stock option redemptions | 165 | 65 |
Repurchase of common stock | 0 | (1,261) |
Dividends paid | (745) | (574) |
Net cash from financing activities | 42,068 | 40,854 |
Net increase in cash and cash equivalents | 6,318 | 18,975 |
Cash and cash equivalents, beginning of year | 48,264 | 29,289 |
Cash and cash equivalents, end of year | 54,582 | 48,264 |
SUPPLEMENTAL CASH FLOW INFORMATION | ||
Cash paid for income taxes | 3,040 | 2,860 |
Interest paid on deposits and borrowings | 2,918 | 2,756 |
Noncash net transfer from premises and equipment to OREO and repossessed assets | 0 | 712 |
Noncash net transfer from loans to OREO and repossessed assets | $ 634 | $ 671 |
Organization and Significant Ac
Organization and Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Organization and Significant Accounting Policies [Abstract] | |
Organization and Significant Accounting Policies | Note 1 - Organization and significant accounting policies Sound Financial Bancorp, a Maryland corporation (“Sound Financial Bancorp” or the “Company”), is a bank holding company for its wholly owned subsidiary, Sound Community Bank (the “Bank”). Substantially all of Sound Financial Bancorp’s business is conducted through Sound Community Bank, a Washington state-chartered commercial bank. As a Washington commercial bank, the Bank’s regulators are the Washington State Department of Financial Institutions (“WDFI”) and the Federal Deposit Insurance Corporation (“FDIC”). The Board of Governors of the Federal Reserve System (“Federal Reserve”) is the primary federal regulator for Sound Financial Bancorp. Subsequent events – Basis of Presentation and Use of Estimates The accompanying consolidated financial statements include the accounts of Sound Financial Bancorp and its wholly-owned subsidiary Sound Community Bank. All significant intercompany balances and transactions between Sound Financial Bancorp and its subsidiary have been eliminated in consolidation. Cash and cash equivalents Investment securities Unrealized gains and losses, net of the related deferred tax effect, are reported as a net amount in accumulated other comprehensive income (loss) on AFS securities in the consolidated balance sheets. Realized gains and losses on AFS securities, determined using the specific identification method, are included in earnings. Amortization of premiums and accretion of discounts are recognized as adjustments to interest income using the interest method over the period to maturity. The Company reviews investment securities on an ongoing basis for the presence of other-than-temporary impairment (“OTTI”) or permanent impairment, taking into consideration current market conditions, fair value in relation to cost, extent and nature of the change in fair value, issuer rating changes and trends, whether the Company intend to sell a security or if it is likely that the Company will be required to sell the security before recovery of its amortized cost basis of the investment, which may be maturity, and other factors. For debt securities, if the Company intends to sell the security or it is likely that it will be required to sell the security before recovering its cost basis, the entire impairment loss would be recognized in earnings as an OTTI. If the Company does not intend to sell the security and it is not likely that we will be required to sell the security but we do not expect to recover the entire amortized cost basis of the security, only the portion of the impairment loss representing credit losses would be recognized in earnings. The credit loss on a security is measured as the difference between the amortized cost basis and the present value of the cash flows expected to be collected. Projected cash flows are discounted by the original or current effective interest rate depending on the nature of the security being measured for potential OTTI. The remaining impairment related to all other factors, the difference between the present value of the cash flows expected to be collected and the fair value, is recognized as a charge to other comprehensive income (“OCI”). The Company does not intend to sell these securities and it is more likely than not that it will not be required to sell the securities before anticipated recovery of the remaining amortized cost basis. The Company closely monitors its investment securities for changes in credit risk. The current market environment significantly limits the Company’s ability to mitigate its exposure to valuation changes in these securities by selling them. Accordingly, if market conditions deteriorate further and the Company determines its holdings of these or other investment securities are OTTI, its future earnings, stockholders’ equity, regulatory capital and continuing operations could be materially adversely affected. Loans held-for-sale Loans Loans that management has the intent and ability to hold for the foreseeable future or until maturity or pay-off generally are reported at their outstanding unpaid principal balances adjusted for any charge-offs, the allowance for loan losses, and any deferred fees or costs on origination of loans. Interest income is accrued on the unpaid principal balance. Loan origination fees, net of certain direct origination costs, are deferred and recognized as an adjustment of the related loan yield using the interest method over the contractual life of the loan for term loans or the straight-line method for open ended loans. The accrual of interest is discontinued at the time the loan is three months past due or if, in management’s opinion, the borrower may be unable to meet payment of obligations as they become due, as well as when required by regulatory provisions. Loans are typically charged off no later than 120 days past due, unless secured by collateral. Past due status is based on contractual terms of the loan. In all cases, loans are placed on nonaccrual or charged off at an earlier date if collection of principal or interest is considered doubtful. All interest accrued but not collected for loans that are placed on nonaccrual or charged off is reversed against interest income. The interest on these loans is accounted for on the cash-basis or cost-recovery method, until qualifying for return to accrual. Loans are returned to accrual status when all of the principal and interest amounts contractually due are brought current, future payments are reasonably assured and payments have been received for twelve consecutive months. A loan is considered impaired when it is probable that the Company will be unable to collect all amounts (principal and interest) due according to the contractual terms of the original loan agreement. When a loan has been identified as being impaired, the amount of the impairment is measured by using discounted cash flows, except when, as a practical expedient, the current fair value of the collateral, reduced by costs to sell, is used. When the measurement of the impaired loan is less than the recorded investment in the loan (including accrued interest), impairment is recognized by charging off the impaired portion or creating or adjusting a specific allocation of the allowance for loan losses. A loan is classified as a troubled debt restructuring (“TDR”) when certain concessions have been made to the contractual terms, such as reductions of interest rates or deferrals of interest or principal payments due to the borrower’s deteriorated financial condition. All TDRs are reported and accounted for as impaired loans. Allowance for loan losses The allowance for loan losses is maintained at a level sufficient to provide for probable credit losses based upon evaluating known and inherent risks in the loan portfolio. The allowance is provided based upon management’s continuing analysis of the pertinent factors underlying the quality of the loan portfolio. These factors include changes in the size and composition of the loan portfolio, delinquency levels, actual loan loss experience, current economic conditions, and detailed analysis of individual loans for which full collectability may not be assured. The detailed analysis includes techniques to estimate the fair value of loan collateral and the existence of potential alternative sources of repayment. The allowance consists of specific, general, and unallocated components. The specific component relates to loans that are classified as doubtful, substandard, or special mention. The Company considers installment loans to be pools of smaller balance, homogenous loans that are collectively evaluated for impairment, unless such loans are subject to a TDR agreement. For such loans that are also classified as impaired, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan are lower than the carrying value of that loan. The general component covers non-classified loans and is based upon historical loss experience adjusted for qualitative factors. An unallocated component is maintained to cover uncertainties that could affect management’s estimate of probable losses. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating specific and general losses in the portfolio. The appropriateness of the allowance for loan losses is estimated based upon those factors and trends identified by management at the time consolidated financial statements are prepared. When available information confirms that specific loans or portions thereof are uncollectible, identified amounts are charged against the allowance for loan losses. The existence of some or all of the following criteria will generally confirm that a loss has been incurred: the loan is significantly delinquent and the borrower has not demonstrated the ability or intent to bring the loan current; the Company has no recourse to the borrower, or if it does, the borrower has insufficient assets to pay the debt; the estimated fair value of the loan collateral is significantly below the current loan balance, and there is little or no near-term prospect for improvement. The ultimate recovery of all loans is susceptible to future market factors beyond the Company’s control. These factors may result in losses or recoveries differing significantly from those provided in the consolidated financial statements. In addition, regulatory agencies, as an integral part of their examination process, periodically review the Company’s allowance for loan losses, and may require the Company to make additions to the allowance based on their judgment about information available to them at the time of their examinations. Transfers of financial assets Mortgage servicing rights (“MSR”) Premises and equipment Bank-owned life insurance, net Federal Home Loan Bank stock Other real estate owned and repossessed assets In some instances, the Company may make loans to facilitate the sales of OREO. Management reviews all sales for which it is the lending institution. Any gains related to sales of other real estate owned may be deferred until the buyer has a sufficient investment in the property. Income Taxes Segment reporting Off-balance-sheet credit-related financial instruments Advertising costs Comprehensive income Intangible assets Employee stock ownership plan Unearned ESOP shares are shown as a reduction of stockholders’ equity. When the shares are released, unearned common shares held by the ESOP are reduced by the cost of the ESOP shares released and the differential between the fair value and the cost is charged to additional paid in capital. The loan receivable from the ESOP to the Company is not reported as an asset nor is the debt of the ESOP reported as a liability on the Company’s Consolidated Statements of Condition. Earnings Per Common Share Fair value Fair values of the Company’s financial instruments are based on the fair value hierarchy which requires an entity to maximize the use of observable inputs, typically market data obtained from third parties, and minimize the use of unobservable inputs, which reflects its estimates for market assumptions, when measuring fair value. Three levels of valuation inputs are ranked in accordance with the prescribed fair value hierarchy as follows: Level 1: Level 2: Level 3: In determining the appropriate levels, the Company performs a detailed analysis of the assets and liabilities that are subject to fair value measurements. In certain cases, the inputs used to measure fair value of an asset or liability may fall into different levels of the fair value hierarchy. The level within which the fair value measurement is categorized is based on the lowest level unobservable input that is significant to the fair value measurement in its entirety. Therefore, an item may be classified in Level 3 even though there may be some significant inputs that are readily observable. Share-Based Compensation Reclassifications |
Accounting Pronouncements Recen
Accounting Pronouncements Recently Issued or Adopted | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Pronouncements Recently Issued or Adopted [Abstract] | |
Accounting Pronouncements Recently Issued or Adopted | Note 2 – Accounting Pronouncements Recently Issued or Adopted In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606), which creates Topic 606 and supersedes Topic 605, Revenue Recognition. In August 2015, FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606), which postponed the effective date of 2014-09. In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net, which amended the principal versus agent implementation guidance set for in ASU 2014-09. Among other things, ASU 2016-08 clarifies that an entity should evaluate whether it is the principal or the agent for each specified good or service promised in a contract with a customer. In April 2016, the FASB issued ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing. The ASU amends certain aspects of the guidance set forth in the FASB’s new revenue standard related to identifying performance obligations and licensing implementation. The core principle of Topic 606 is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In general, the new ASU requires companies to use more judgment and make more estimates than under current guidance, including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. In May 2016, the FASB issued ASU No. 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients, which provides clarifying guidance in certain narrow areas and adds some practical expedients, but does not change the core revenue recognition principle in Topic 606. This ASU is effective for interim and annual periods beginning after December 15, 2017; early adoption is not permitted. For financial reporting purposes, the ASU allows for either full retrospective adoption, meaning this ASU is applied to all of the periods presented, or modified retrospective adoption, meaning the ASU is applied only to the most current period presented in the financial statements with the cumulative effect of initially applying the ASU is recognized at the date of initial application. As a financial institution, the Company's largest component of revenue, interest income, is excluded from the scope this ASU. The Company is currently evaluating the provisions to determine the potential impact the new standard will have on the Company’s consolidated financial statements. In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments - Overall (Subtopic 825-10), Recognition and Measurement of Financial Assets and Financial Liabilities. The new guidance is intended to improve the recognition and measurement of financial instruments. This ASU requires equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income. In addition, the ASU requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes and requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset (i.e., securities or loans and receivables) on the balance sheet or the accompanying notes to the financial statements. This ASU also eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet. The ASU also requires a reporting organization to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument specific credit risk (also referred to as “own credit”) when the organization has elected to measure the liability at fair value in accordance with the fair value option for financial instruments. ASU No. 2016-01 is effective for financial statements issued for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted for certain provisions. The Company is currently evaluating the impact of this ASU on the Company's consolidated financial statements. In February 2016, FASB issued ASU No. 2016-02, Leases (Topic 842). ASU No. 2016-02 requires lessees to recognize, on the balance sheet, the assets and liabilities arising from operating leases. A lessee should recognize a liability to make lease payments and a right-of-use asset representing its right to use the underlying asset for the lease term. A lessee should include payments to be made in an optional period only if the lessee is reasonably certain to exercise an option to extend the lease or not to exercise an option to terminate the lease. For a finance lease, interest payments should be recognized separately from amortization of the right-of-use asset in the statement of comprehensive income. For operating leases, the lease cost should be allocated over the lease term on a generally straight-line basis. The amendments in ASU 2016-02 are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early application of the amendments in the ASU is permitted. Although an estimate of the impact of the new leasing standard has not yet been determined, the Company expects a significant new lease asset and related lease liability on the balance sheet due to the number of leased properties the Bank currently has that are accounted for under current operating lease guidance. In March 2016, the FASB issued ASU No. 2016-06, Derivatives and Hedging (Topic 815): Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships. A contract novation refers to replacing one of the parties to a derivative instrument with a new party. This ASU clarifies that a change in counterparty in a derivative instrument does not, in and of itself, require re-designation of that hedging relationship and therefore discontinue the application of hedge accounting. ASU 2016-05 is effective for financial statements issued for fiscal years beginning after December 15, 2016, and interim periods within those fiscal years. Early adoption is permitted in any interim or annual period. The adoption of ASU 2016-05 is not expected to have a material impact on the Company’s consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, Improvements to Employee Share-Based Payment Accounting, which amends ASC Topic 718, Compensation - Stock Compensation. The ASU includes provisions intended to simplify various aspects related to how share-based payments are accounted for and presented in the financial statements. The ASU is effective for annual and interim periods beginning after December 15, 2016. The adoption of ASU is being reviewed for any material impact there may be on the Company’s consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments- Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This ASU replaces the existing incurred loss impairment methodology that recognizes credit losses when a probable loss has been incurred with new methodology where loss estimates are based upon lifetime expected credit losses. The amendments in this ASU require a financial asset that is measured at amortized cost to be presented at the net amount expected to be collected. The income statement would then reflect the measurement of credit losses for newly recognized financial assets as well as changes to the expected credit losses that have taken place during the reporting period. The measurement of expected credit losses will be based on historical information, current conditions, and reasonable and supportable forecasts that impact the collectability of the reported amount. Available-for-sale securities will bifurcate the fair value mark and establish an allowance for credit losses through the income statement for the credit portion of that mark. The interest portion will continue to be recognized through accumulated other comprehensive income or loss. The change in allowance recognized as a result of adoption will occur through a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the ASU is adopted. The amendments in this ASU are effective for fiscal years beginning after December 15, 2019 with early adoption permitted after December 15, 2018. The Company has begun the process to implement this new standard by working with a key vendor that specializes in this area. It has yet to be determined what impact this standard will have on the Company's consolidated financial statements. While the Company has not quantified the impact of this ASU, it does expect changing from the current incurred loss model to an expected loss model will result in an earlier recognition of losses In August 2016, FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. This ASU addresses the appropriate classification of eight specific cash flow issues on the cash flow statement. Debt prepayment costs should be classified as an outflow for financing activities. Settlement of zero-coupon debt instruments divides the interest portion as an outflow for operating activities and the principal portion as an outflow for financing activities. Contingent consideration payments made after a business combination should be classified as outflows for financing and operating activities. Proceeds from the settlement of bank-owned life insurance policies should be classified as inflows from investing activities. Other specific areas are identified in the ASU as to the appropriate classification of the cash inflows or outflows. The amendments in this ASU are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early adoption is permitted and must be applied using a retrospective transition method to each period presented. The Company does not expect this ASU to have a material impact on the Company’s consolidated financial statements. In December 2016, FASB issued ASU No. 2016-19, “Technical Corrections and Improvements” and ASU 2016-20, “Technical Corrections and Improvements to Topic 606: Revenue from Contracts with Customers.” On November 10, 2010 FASB added a standing project that will facilitate the FASB Accounting Standards Codification (“Codification”) updates for technical corrections, clarifications, and improvements. These amendments are referred to as Technical Corrections and Improvements. Maintenance updates include non-substantive corrections to the Codification, such as editorial corrections, various link-related changes, and changes to source fragment information. These updates contain amendments that will affect a wide variety of Topics in the Codification. The amendments in these ASUs will apply to all reporting entities within the scope of the affected accounting guidance and generally fall into one of four categories: amendments related to differences between original guidance and the Codification, guidance clarification and reference corrections, simplification, and minor improvements. In summary, the amendments represent changes to clarify the Codification, correct unintended application of guidance, or make minor improvements to the Codification that are not expected to have a significant effect on current accounting practice. Transition guidance varies based on the amendments in the ASUs. The amendments that require transition guidance are effective for fiscal years and interim reporting periods after December 15, 2016. Early adoption is permitted including adoption in an interim period. All other amendments are effective upon the issuance of these ASUs. Neither ASU 2016-19 nor ASU 2016-20 had a material impact on the Company’s consolidated financial statements. In January 2017, FASB issued ASU 2017-03, “Accounting Changes and Error Corrections (Topic 250) and Investments-Equity Method and Joint Ventures (Topic 323).” The ASU amends the Codification for SEC staff announcements made at recent Emerging Issues Task Force (EITF) meetings. The SEC guidance that specifically relates to our Consolidated Financial Statement was from the September 2016 meeting, where the SEC staff expressed their expectations about the extent of disclosures registrants should make about the effects of the new FASB guidance as well as any amendments issued prior to adoption, on revenue (ASU 2014-09), leases (ASU 2016-02) and credit losses on financial instruments (ASU 2016-13) in accordance with SAB Topic 11.M. Registrants are required to disclose the effect that recently issued accounting standards will have on their financial statements when adopted in a future period. In cases where a registrant cannot reasonably estimate the impact of the adoption, then additional qualitative disclosures should be considered. The ASU incorporates these SEC staff views into ASC 250 and adds references to that guidance in the transition paragraphs of each of the three new standards. The adoption of this ASU did not have a material effect on the Company’s consolidated financial statements. In January 2017, FASB issued ASU No. 2017-04, “Simplifying the Test for Goodwill Impairment”. The amendments in this ASU are intended to reduce the cost and complexity of the goodwill impairment test by eliminating Step 2 from the impairment test. The amendments modify the concept of impairment from the condition that exists when the carrying amount of goodwill exceeds its implied fair value to the condition that exists when the carrying amount of a reporting unit exceeds its fair value. Under the amendments in this ASU, an entity will perform its annual, or interim, goodwill impairment test by comparing the fair value of the reporting unit with its carrying amount. An impairment charge should be recognized for the amount which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The amendments in this ASU are effective for the Company’s annual or any interim goodwill impairment test in fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company does not expect this ASU to have a material impact on the Company’s consolidated financial statements. |
Restricted Cash
Restricted Cash | 12 Months Ended |
Dec. 31, 2016 | |
Restricted Cash [Abstract] | |
Restricted Cash | Note 3 – Restricted Cash Federal Reserve Board regulations require that the Company maintain certain minimum reserve balances either as cash on hand or on deposit with the Federal Reserve Bank, based on a percentage of deposits. The reserve balances were $7.7 million and $4.6 million at December 31, 2016 and 2015, respectively. |
Investments
Investments | 12 Months Ended |
Dec. 31, 2016 | |
Investments [Abstract] | |
Investments | Note 4 – Investments The amortized cost and fair value of AFS securities and the corresponding amounts of gross unrealized gains and losses at December 31, 2016 and 2015 were as follows (in thousands): Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value December 31, 2016 Municipal bonds $ 3,262 $ 127 $ (36 ) $ 3,353 Agency mortgage-backed securities 2,858 49 (3 ) 2,904 Non-agency mortgage-backed securities 362 — (15 ) 347 Total $ 6,482 $ 176 $ (54 ) $ 6,604 December 31, 2015 Municipal bonds $ 1,912 $ 184 $ — $ 2,096 Agency mortgage-backed securities 4,088 102 (18 ) 4,172 Non-agency mortgage-backed securities 449 — (21 ) 428 Total $ 6,449 $ 286 $ (39 ) $ 6,696 The amortized cost and fair value of mortgage-backed securities by contractual maturity, at December 31, 2016, are shown below (in thousands). Expected maturities of mortgage-backed securities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. December 31, 2016 Amortized Cost Fair Value Due in less than one year $ — $ — Due in one to five years 1,349 1,313 Due after five to ten years 414 432 Due after ten years 4,719 4,859 Total $ 6,482 $ 6,604 There were no pledged securities at December 31, 2016. There were no sales of AFS securities for the years ended December 31, 2016 or 2015. The following table summarizes at December 31, 2016 and 2015 the aggregate fair value and gross unrealized loss by length of time those investments have been continuously in an unrealized loss position (in thousands): December 31, 2016 Less Than 12 Months 12 Months or Longer Total Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss Municipal bonds $ 1,313 $ (36 ) $ — $ — $ 1,313 $ (36 ) Agency mortgage-backed securities — — 1,125 (3 ) 1,125 $ (3 ) Non-agency mortgage-backed securities — — 347 (15 ) 347 (15 ) Total $ 1,313 $ (36 ) $ 1,472 $ (18 ) $ 2,785 $ (54 ) December 31, 2015 Less Than 12 Months 12 Months or Longer Total Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss Agency mortgage-backed securities $ — $ — $ 1,370 $ (18 ) $ 1,370 $ (18 ) Non-agency mortgage-backed securities — — 428 (21 ) 428 (21 ) Total $ — $ — $ 1,798 $ (39 ) $ 1,798 $ (39 ) The following table presents at December 31, 2016 and 2015 the cumulative roll forward of credit losses recognized in earnings relating to the Company’s non-U.S. agency mortgage backed securities (in thousands): Year Ended December 31, 2016 2015 Estimated credit losses, beginning balance $ — $ 450 Additions for credit losses not previously recognized — — Reduction for increases in cash flows — — Removal of credit losses due to securities sold — (450 ) Estimated credit losses, ending balance $ — $ — At December 31, 2016, the securities portfolio consisted of nine agency mortgage-backed securities, one non-agency mortgage-backed security and eight municipal securities with a fair value of $6.6 million. At December 31, 2015, the securities portfolio consisted of 12 agency mortgage-backed securities, one non-agency mortgage-backed securities and five municipal bonds with a fair value of $6.7 million. At December 31, 2016, one agency mortgage-backed security and three municipal securities were in an unrealized loss position. At December 31, 2015, one agency mortgage-backed security was in an unrealized loss position. For both the 2016 and 2015 periods, the unrealized losses were caused by changes in market interest rates or market illiquidity subsequent to the initial purchase of the securities, and not related to the underlying credit of the issuer or the underlying collateral. Because the decline in fair value is attributable to changes in interest rates or market illiquidity and not credit quality, and because it is more likely than not that the Company will not be required to sell either security before anticipated recovery of the remaining amortized cost basis, the unrealized loss on these securities is not considered an OTTI |
Loans
Loans | 12 Months Ended |
Dec. 31, 2016 | |
Loans [Abstract] | |
Loans | Note 5 – Loans The composition of the loan portfolio, excluding loans held-for-sale, at December 31, 2016 and 2015 is as follows (in thousands): At December 31, 2016 2015 Real estate loans: One- to four- family $ 152,386 $ 141,125 Home equity 27,771 31,573 Commercial and multifamily 181,004 175,312 Construction and land 70,915 57,043 Total real estate loans 432,076 405,053 Consumer loans: Manufactured homes 15,494 13,798 Other consumer (1) 27,928 23,030 Total consumer loans 43,422 36,828 Commercial business loans 26,331 19,295 Total loans 501,829 461,176 Deferred fees (1,828 ) (1,707 ) Total loans, gross 500,001 459,469 Allowance for loan losses (4,822 ) (4,636 ) Total loans, net $ 495,179 $ 454,833 (1) Included in other consumer loans are floating home loans totaling $24.0 million and $18.2 million as of December 31, 2016 and 2015, respectively. The following table presents the balance in the allowance for loan losses and the unpaid principal balance in loans, net of partial charge-offs by portfolio segment and based on impairment method as of December 31, 2016 (in thousands): One-to- four family Home equity Commercial and multifamily Construction and land Manufactured homes Other consumer Commercial business Unallocated Total Allowance for loan losses: Individually evaluated for impairment $ 536 $ 121 $ 24 $ 35 $ 59 $ 65 $ 23 $ — $ 863 Collectively evaluated for impairment 1,006 257 1,120 424 109 179 152 712 3,959 Ending balance $ 1,542 $ 378 $ 1,144 $ 459 $ 168 $ 244 $ 175 $ 712 $ 4,822 Loans receivable: Individually evaluated for impairment $ 4,749 $ 832 $ 1,582 $ 83 $ 312 $ 62 $ 616 $ — $ 8,236 Collectively evaluated for impairment 147,637 26,939 179,422 70,832 15,182 27,866 25,715 — 493,593 Ending balance $ 152,386 $ 27,771 $ 181,004 $ 70,915 $ 15,494 $ 27,928 $ 26,331 $ — $ 501,829 The following table presents the balance in the allowance for loan losses and the unpaid principal balance in loans, net of partial charge-offs by portfolio segment and based on impairment method as of December 31, 2015 (in thousands): One-to- four family Home equity Commercial and multifamily Construction and land Manufactured homes Other consumer Commercial business Unallocated Total Allowance for loan losses: Individually evaluated for impairment $ 647 $ 110 $ 36 $ 18 $ 63 $ — $ 8 $ — $ 882 Collectively evaluated for impairment 1,192 497 885 364 238 188 149 241 3,754 Ending balance $ 1,839 $ 607 $ 921 $ 382 $ 301 $ 188 $ 157 $ 241 $ 4,636 Loans receivable: Individually evaluated for impairment $ 5,779 $ 904 $ 1,966 $ 91 $ 361 $ 5 $ 114 $ — $ 9,220 Collectively evaluated for impairment 135,346 30,669 173,346 56,952 13,437 23,025 19,181 — 451,956 Ending balance $ 141,125 $ 31,573 $ 175,312 $ 57,043 $ 13,798 $ 23,030 $ 19,295 $ — $ 461,176 The following table summarizes the activity in loan losses for the year ended December 31, 2016 (in thousands): Beginning Allowance Charge-offs Recoveries Provision Ending Allowance One-to-four family $ 1,839 $ (72 ) $ 47 $ (272 ) $ 1,542 Home equity 607 (15 ) 78 (292 ) 378 Commercial and multifamily 921 (314 ) — 537 1,144 Construction and land 382 — 18 59 459 Manufactured homes 301 — 8 (141 ) 168 Other consumer 188 (42 ) 53 45 244 Commercial business 157 (29 ) — 47 175 Unallocated 241 — — 471 712 $ 4,636 $ (472 ) $ 204 $ 454 $ 4,822 The following table summarizes the activity in loan losses for the year ended December 31, 2015 (in thousands): Beginning Allowance Charge-offs Recoveries Provision Ending Allowance One-to-four family $ 1,442 $ (21 ) $ — $ 418 $ 1,839 Home equity 601 (35 ) 36 5 607 Commercial and multifamily 1,244 — — (323 ) 921 Construction and land 399 (40 ) — 23 382 Manufactured homes 193 (37 ) 8 137 301 Other consumer 167 (77 ) 15 83 188 Commercial business 108 — — 49 157 Unallocated 233 — — 8 241 $ 4,387 $ (210 ) $ 59 $ 400 $ 4,636 Credit Quality Indicators. When the Company classifies problem loans as either substandard or doubtful, it may establish a specific allowance in an amount it deems prudent to address the risk specifically (if the loan is impaired) or it may allow the loss to be addressed in the general allowance (if the loan is not impaired). General allowances represent loss reserves which have been established to recognize the inherent risk associated with lending activities, but which, unlike specific allowances, have not been specifically allocated to particular problem assets. When the Company classifies problem loans as a loss, it charges off such assets in the period in which they are deemed uncollectible. Assets that do not currently expose the Company to sufficient risk to warrant classification as substandard or doubtful but possess identified weaknesses are classified as either watch or special mention assets. The Company’s determination as the classification of its assets and the amount of its valuation allowances is subject to review by the FDIC, which can order the establishment of additional loss allowances. Pass rated loans are loans that are not otherwise classified or criticized. The following table represents the internally assigned grades as of December 31, 2016 by type of loan (in thousands): One-to- four family Home equity Commercial and multifamily Construction and land Manufactured homes Other consumer Commercial business Total Grade: Pass $ 148,617 $ 26,547 $ 171,678 $ 67,539 $ 15,288 $ 27,817 $ 25,625 $ 483,111 Watch 998 536 8,105 3,376 78 49 326 13,468 Special Mention 139 — — 30 — — 169 Substandard 2,632 688 1,221 — 98 62 380 5,081 Doubtful — — — — — — — — Loss — — — — — — — — Total $ 152,386 $ 27,771 $ 181,004 $ 70,915 $ 15,494 $ 27,928 $ 26,331 $ 501,829 The following table represents the internally assigned grades as of December 31, 2015 by type of loan (in thousands): One-to- four family Home equity Commercial and multifamily Construction and land Manufactured homes Other consumer Commercial business Total Grade: Pass $ 136,879 $ 30,310 $ 169,072 $ 55,984 $ 13,621 $ 22,967 $ 18,449 $ 447,282 Watch 1,015 609 4,810 1,059 96 58 846 8,493 Special Mention 1,409 — 1,430 — 33 — — 2,872 Substandard 1,822 654 — — 48 5 — 2,529 Doubtful — — — — — — — — Loss — — — — — — — — Total $ 141,125 $ 31,573 $ 175,312 $ 57,043 $ 13,798 $ 23,030 $ 19,295 $ 461,176 Nonaccrual and Past Due Loans The following table presents the recorded investment in nonaccrual loans as of December 31, 2016 and 2015 by type of loan (in thousands): 2016 2015 One- to four- family $ 2,169 $ 1,157 Home equity 536 344 Commercial and Multifamily 218 — Manufactured homes 72 27 Commercial 149 — Total $ 3,144 $ 1,528 The following table represents the aging of the recorded investment in past due loans as of December 31, 2016 by type of loan (in thousands): 30-59 Days Past Due 60-89 Days Past Due Greater Than 90 Days Past Due Recorded Investment > 90 Days and Accruing Total Past Due Current Total Loans One-to-four family $ 2,476 $ 161 $ 1,787 $ — $ 4,424 $ 147,962 $ 152,386 Home equity 460 — 494 — 954 26,817 27,771 Commercial and multifamily — — — — — 181,004 181,004 Construction and land 440 — — — 440 70,475 70,915 Manufactured homes 321 28 62 — 411 15,083 15,494 Other consumer 26 1 — — 27 27,901 27,928 Commercial business 149 — — — 149 26,182 26,331 Total $ 3,872 $ 190 $ 2,343 $ — $ 6,405 $ 495,424 $ 501,829 The following table represents the aging of the recorded investment in past due loans as of December 31, 2015 by type of loan (in thousands): 30-59 Days Past Due 60-89 Days Past Due Greater Than 90 Days Past Due Recorded Investment > 90 Days and Accruing Total Past Due Current Total Loans One-to-four family $ 2,453 $ 265 $ 881 $ 117 $ 3,716 $ 137,409 $ 141,125 Home equity 352 60 296 — 708 30,865 31,573 Commercial and multifamily 203 — — — 203 175,109 175,312 Construction and land 65 — — — 65 56,978 57,043 Manufactured homes 103 27 — — 130 13,668 13,798 Other consumer 17 26 — — 43 22,987 23,030 Commercial business 154 8 — — 162 19,133 19,295 Total $ 3,347 $ 386 $ 1,177 $ 117 $ 5,027 $ 456,149 $ 461,176 Nonperforming Loans. The following table represents the credit risk profile based on payment activity as of December 31, 2016 by type of loan (in thousands): One- to four- family Home equity Commercial and multifamily Construction and land Manufactured homes Other consumer Commercial business Total Performing $ 150,170 $ 27,218 $ 180,786 $ 70,915 $ 15,374 $ 27,928 $ 26,089 $ 498,480 Nonperforming 2,216 553 218 — 120 — 242 3,349 Total $ 152,386 $ 27,771 $ 181,004 $ 70,915 $ 15,494 $ 27,928 $ 26,331 $ 501,829 The following table represents the credit risk profile based on payment activity as of December 31, 2015 by type of loan (in thousands): One- to four- family Home equity Commercial and multifamily Construction and land Manufactured homes Other consumer Commercial business Total Performing $ 139,485 $ 31,145 $ 175,312 $ 57,043 $ 13,736 $ 23,030 $ 19,295 $ 459,046 Nonperforming 1,640 428 — 62 — — 2,130 Total $ 141,125 $ 31,573 $ 175,312 $ 57,043 $ 13,798 $ 23,030 $ 19,295 $ 461,176 Impaired Loans The following table presents loans individually evaluated for impairment as of December 31, 2016 by type of loan (in thousands): Recorded Investment Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized With no related allowance recorded: One- to four- family $ 2,454 $ 2,715 $ — $ 1,476 $ 125 Home equity 446 446 — 304 18 Commercial and multifamily 1,221 1,221 — 1,326 70 Manufactured homes 91 106 — 46 9 Commercial business 143 143 — 71 10 Total 4,355 4,631 — 3,223 232 Recorded Investment Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized With an allowance recorded: One- to four- family 2,295 2,295 536 3,788 106 Home equity 386 466 121 564 19 Commercial and multifamily 361 361 24 449 17 Construction and land 83 83 35 87 4 Manufactured homes 221 221 59 291 16 Other consumer 62 62 65 34 4 Commercial business 473 473 23 294 26 Total 3,881 3,961 863 5,507 192 Totals: One- to four- family 4,749 5,010 536 5,264 231 Home equity 832 913 121 868 37 Commercial and multifamily 1,582 1,582 24 1,775 87 Construction and land 83 83 35 87 4 Manufactured homes 312 326 59 337 25 Other consumer 62 62 65 34 4 Commercial business 616 616 23 365 36 Total $ 8,236 $ 8,592 $ 863 $ 8,730 $ 424 The following table presents loans individually evaluated for impairment as of December 31, 2015 by type of loan (in thousands): Recorded Investment Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized With no related allowance record One- to four- family $ 499 $ 615 $ — $ 1,390 $ 23 Home equity 162 162 — 341 7 Commercial and multifamily 1,430 1,430 — 1,051 80 Construction and land — — — 40 — Manufactured homes — — — 52 — Other consumer — — — 28 — Commercial business — — — 61 — Total 2,091 2,207 — 2,963 110 With an allowance recorded: One- to four- family 5,280 5,396 647 3,686 246 Home equity 742 832 110 748 30 Commercial and multifamily 536 536 36 1,357 10 Construction and land 91 91 18 106 5 Manufactured homes 361 366 63 332 29 Other consumer 5 5 — 11 1 Commercial business 114 114 8 68 6 Total 7,129 7,340 882 6,308 327 Totals: One- to four- family 5,779 6,011 647 5,076 269 Home equity 904 994 110 1,089 37 Recorded Investment Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized Commercial and multifamily 1,966 1,966 36 2,408 90 Construction and land 91 91 18 146 5 Manufactured homes 361 366 63 384 29 Other consumer 5 5 — 39 1 Commercial business 114 114 8 129 6 Total $ 9,220 $ 9,547 $ 882 $ 9,271 $ 437 Forgone interest on nonaccrual loans was $54,000 and $104,000 at December 31, 2016 and 2015, respectively. There were no commitments to lend additional funds to borrowers whose loans were classified as nonaccrual, TDR or impaired at December 31, 2016 and 2015. Troubled debt restructurings. Rate Modification Term Modification Combination Modification There was one new TDR during the year ended December 31, 2016 of $40,000 related to an unsecured loan. The TDR was a combination modification. There was one new TDR during the year ended December 31, 2015 of $368,000 related to a commercial and multifamily loan. The TDR was a combination modification. There were no post-modification changes for the unpaid principal balance in loans, net of partial charge-offs, that were recorded as a result of the TDRs for the years ended December 31, 2016 and 2015. There were no TDRs for which there was a payment default within the first 12 months of modification during the twelve months ended December 31, 2016 and 2015. The Company had no commitments to extend additional credit to borrowers owing receivables whose terms have been modified in TDRs. All TDRs are also classified as impaired loans and are included in the loans individually evaluated for impairment in the calculation of the allowance for loan losses. In the ordinary course of business, the Company makes loans to its directors and officers. Certain loans to directors, officers, and employees are offered at discounted rates as compared to other customers as permitted by federal regulations. Employees, officers, and directors are eligible for mortgage loans with an adjustable rate that resets annually to 1% over the rolling cost of funds. Employees and officers are eligible for consumer loans that are 1% below the market loan rate at the time of origination. Director and officer loans are summarized as follows (in thousands): December 31, 2016 2015 Balance, beginning of period $ 4,093 $ 4,675 Advances 115 69 New / (retired) loans, net (897 ) 174 Repayments (131 ) (825 ) Balance, end of period $ 3,180 $ 4,093 At December 31, 2016 and 2015, loans totaling $5.8 million and $7.8 million, respectively, represented real estate secured loans that had current loan-to-value ratios above supervisory guidelines. |
Mortgage Servicing Rights
Mortgage Servicing Rights | 12 Months Ended |
Dec. 31, 2016 | |
Mortgage Servicing Rights [Abstract] | |
Mortgage Servicing Rights | Note 6 – Mortgage Servicing Rights The unpaid principal balances of loans serviced for Federal National Mortgage Association (FNMA) at December 31, 2016 and 2015, totaled approximately $410.1 million and $360.4 million, respectively, and are not included in the Company’s consolidated financial statements. The Company also services loans for other financial institutions. The unpaid principal balances of loans serviced for other financial institutions at December 31, 2016 and 2015, totaled approximately $13.8 million and $9.4 million, respectively, and was not included in the Company’s financial statements. A summary of the change in the balance of mortgage servicing assets at December 31, 2016 and 2015 is as follows (in thousands): Year Ended December 31, 2016 2015 Beginning balance, at fair value $ 3,249 $ 3,028 Servicing rights that result from transfers and purchase of financial assets 1,049 679 Changes in fair value: Due to changes in model inputs or assumptions (1) (49 ) 210 Other (2) (688 ) (668 ) Ending balance, at fair value $ 3,561 $ 3,249 (1) Represents changes in discount rates and prepayment speed assumptions, which are primarily affected by changes in interest rates. (2) Represents changes due to collection or realization of expected cash flows over time. The key economic assumptions used in determining the fair value of mortgage servicing rights were as follows: At December 31, 2016 2015 Prepayment speed (PSA) 152 % 178 % Weighted-average life (years) 7.2 6.7 Yield to maturity discount rate 13.0 % 10.0 % The amount of contractually specified servicing, late and ancillary fees earned and recorded in mortgage servicing income on the Consolidated Statements of Income, was $956,000 and $840,000, for the years ended December 31, 2016 and 2015, respectively. |
Premises and Equipment
Premises and Equipment | 12 Months Ended |
Dec. 31, 2016 | |
Premises and Equipment [Abstract] | |
Premises and Equipment | Note 7 – Premises and Equipment Premises and equipment at December 31, 2016 and 2015 are summarized as follows (in thousands): At December 31, 2016 2015 Land $ 653 $ 653 Buildings and improvements 4,742 4,739 Furniture and equipment 3,756 2,752 Less: Accumulated depreciation and amortization (3,602 ) (2,809 ) Premises and equipment, net $ 5,549 $ 5,335 Depreciation and amortization expense was $793,000 and $620,000, for the years ended December 31, 2016 and 2015, respectively. The Company leases office space in several buildings. Generally, operating leases contain renewal options and provisions requiring the Company to pay property taxes and operating expenses over base period amounts. All rental payments are dependent only upon the lapse of time. Minimum rental payments under non-cancelable operating leases with initial or remaining terms of one year or more are as follows (in thousands): Year ending December 31, Amount 2017 $ 1,128 2018 933 2019 903 2020 858 2021 876 Thereafter 6,146 $ 10,844 The total rental expense for the years ended December 31, 2016 and 2015 for all facilities leased under operating leases was approximately $1.0 million and $877,000, respectively. |
Other Real Estate Owned and Rep
Other Real Estate Owned and Repossessed Assets | 12 Months Ended |
Dec. 31, 2016 | |
Other Real Estate Owned and Repossessed Assets [Abstract] | |
Other Real Estate Owned and Repossessed Assets | Note 8 – Other Real Estate Owned and Repossessed Assets The following table presents activity related to OREO and other repossessed assets for the periods shown (in thousands): Year ended December 31, 2016 2015 Beginning balance $ 769 $ 323 Additions to OREO and repossessed assets 634 1,383 Pay downs/Sales (252 ) (736 ) Write-ups/Gains (Write-downs/Losses) 21 (201 ) $ 1,172 $ 769 |
Deposits
Deposits | 12 Months Ended |
Dec. 31, 2016 | |
Deposits [Abstract] | |
Deposits | Note 9- Deposits A summary of deposit accounts with the corresponding weighted average cost of funds at December 31, 2016 and 2015 are presented below (dollars in thousands): As of December 31, 2016 As of December 31, 2015 Deposit Balance Wtd Avg Rate Deposit Balance Wtd Avg Rate Noninterest-bearing demand $ 60,566 0.00 % $ 48,067 0.00 % Interest-bearing demand 150,327 0.34 127,392 0.42 Savings 44,879 0.21 38,833 0.18 Money market 49,042 0.17 54,046 0.16 Certificates 159,742 1.12 168,880 1.22 Escrow (1) 3,175 0.00 2,806 0.00 Total $ 467,731 0.53 % $ 440,024 0.63 % (1) Escrow balances shown in noninterest-bearing deposits on the consolidated balance sheets. Scheduled maturities of time deposits at December 31, 2016 are as follows (in thousands): Year Ending December 31, Amount 2017 $ 80,468 2018 45,260 2019 14,392 2020 6,044 Thereafter 13,578 $ 159,742 Savings, demand, and money market accounts have no contractual maturity. Certificates of deposit have maturities of five years or less. The aggregate amount of time deposits in denominations of $250,000 or more at December 31, 2016 and 2015 was approximately $56.7 million and $63.3 million, respectively. Deposits in excess of $250,000 are not federally insured. There were $3.6 million and $4.7 million of brokered deposits at December 31, 2016 and 2015, respectively. Deposits from related parties held by the Company were $1.3 million and $3.0 million at December 31, 2016 and 2015, respectively. |
Borrowings
Borrowings | 12 Months Ended |
Dec. 31, 2016 | |
Borrowings [Abstract] | |
Borrowings | Note 10 – Borrowings The Company utilizes a loan agreement with the FHLB. The terms of the agreement call for a blanket pledge of a portion of the Company’s mortgage, commercial and multifamily portfolio based on the outstanding balance. At December 31, 2016 and 2015, the amount available to borrow under this credit facility was $197.9 million and $174.0 million, respectively. At December 31, 2016, the credit facility was collateralized as follows: one- to four- family mortgage loans with an advance equivalent of $107.2 million, commercial and multifamily mortgage loans with an advance equivalent of $94.4 million and home equity loans with an advance equivalent of $15.9 million. The Company had outstanding borrowings under this arrangement of $54.8 million and $40.4 million at December 31, 2016 and 2015, respectively. Additionally, the Company had outstanding letters of credit from the FHLB with a notional amount of $21.0 million and $47.5 million at December 31, 2016 and December 31, 2015, respectively, to secure public deposits. The net remaining amount available as of December 31, 2016 and December 31, 2015, was $122.2 million and $86.1 million, respectively. All contractual principal repayments of $54.8 million, with a weighted average interest rate of 0.82%, at December 31, 2016 are due within one year. The maximum amount outstanding from the FHLB under term advances at month end during 2016 was $59.8 million and during 2015 was $45.0 million. The average balance outstanding during 2016 was $36.6 million and during 2015 was $24.6 million. The weighted average interest rate on the borrowings was 0.58% in 2016 and 0.43% in 2015. The Company participates in the Federal Reserve Bank (“FRB”) Borrower-in-Custody program, which gives the Company access to the discount window. The terms of the program call for a pledge of specific assets. The Company had unused borrowing capacity of $42.0 million and $25.9 million and no outstanding borrowings under this program at December 31, 2016 and 2015, respectively. The Company has access to an unsecured line of credit from the Pacific Coast Banker’s Bank. The line has a one-year term maturing on June 30, 2017 and is renewable annually. As of December 31, 2016, the amount available under this line of credit was $2.0 million. There was no balance on this line of credit as of December 31, 2016 and 2015, respectively. The Company has access to a Fed Funds line of credit from Zions Bank under a Fed Funds Sweep and Line Agreement established September 26, 2014. The agreement allows access to a Fed Funds Line of up to $9.0 million and requires the Company to maintain cash balances with Zions Bank of $250,000. The agreement has no maturity date. There was no balance on this line of credit as of December 31, 2016 and 2015, respectively. The Company has access to an unsecured line of credit from The Independent Bank (TIB). As of December 31, 2016, the amount available under this line of credit was $10.0 million. There was no balance on this line of credit as of December 31, 2016 and 2015, respectively. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Measurements [Abstract] | |
Fair Value Measurements | Note 11 – Fair Value Measurements The following tables present information about the level in the fair value hierarchy for the Company’s financial instruments as of December 31, 2016 and 2015 (in thousands): December 31, 2016 Fair Value Measurements Using: Carrying Value Estimated Fair Value Level 1 Level 2 Level 3 FINANCIAL ASSETS: Cash and cash equivalents $ 54,582 $ 54,582 $ 54,582 $ — $ — Available for sale securities 6,604 6,604 — 6,257 347 Loans held-for-sale 871 871 — 871 — Loans, net 495,179 494,289 — — 494,289 Accrued interest receivable 1,816 1,816 1,816 — — Mortgage servicing rights 3,561 3,561 — 3,561 FHLB Stock 2,840 2,840 — — 2,840 FINANCIAL LIABILITIES: Non-maturity deposits 307,989 307,989 — 307,989 — Time deposits 159,742 159,333 — 159,333 — Borrowings 54,792 54,805 — 54,805 — Accrued interest payable 73 73 — 73 — December 31, 2015 Fair Value Measurements Using: Carrying Value Estimated Fair Value Level 1 Level 2 Level 3 FINANCIAL ASSETS: Cash and cash equivalents $ 48,264 $ 48,264 $ 48,264 $ — $ — Available for sale securities 6,696 6,696 — 6,268 428 Loans held-for-sale 2,091 2,091 — 2,091 — Loans, net 454,833 454,854 — — 454,854 Accrued interest receivable 1,608 1,608 1,608 — — Mortgage servicing rights 3,249 3,249 — — 3,249 FHLB Stock 2,212 2,212 — — 2,212 FINANCIAL LIABILITIES: Non-maturity deposits 271,144 271,639 — 271,639 — Time deposits 168,880 168,091 — 168,091 — Borrowings 40,435 40,421 — 40,421 — Accrued interest payable 72 72 — 72 — The following tables present the balance of assets measured at fair value on a recurring basis as of December 31, 2016 and 2015 (in thousands): Fair Value at December 31, 2016 Description Total Level 1 Level 2 Level 3 Municipal bonds $ 3,353 $ — $ 3,353 $ — Agency mortgage-backed securities 2,904 — 2,904 — Non-agency mortgage-backed securities 347 — — 347 Mortgage servicing rights 3,561 — — 3,561 Fair Value at December 31, 2015 Description Total Level 1 Level 2 Level 3 Municipal bonds $ 2,096 $ — $ 2,096 $ — Agency mortgage-backed securities 4,172 — 4,172 — Non-agency mortgage-backed securities 428 — — 428 Mortgage servicing rights 3,249 — — 3,249 For the year ended December 31, 2016 there were no transfers between Level 1 and Level 2 nor between Level 2 and Level 3. The following table provides a description of the valuation technique, unobservable input, and qualitative information about the unobservable inputs for the Company’s assets and liabilities classified as Level 3 and measured at fair value on a recurring basis at December 31, 2016: Financial Instrument Valuation Technique Unobservable Input(s) Range (Weighted Average) Mortgage Servicing Rights Discounted cash flow Prepayment speed 104-396% (152%) Discount rate 13%-15% (13%) Non-agency Discounted cash flow Discount rate 7%-9% (8%) The following table provides a description of the valuation technique, unobservable input, and qualitative information about the unobservable inputs for the Company’s assets and liabilities classified as Level 3 and measured at fair value on a recurring basis at December 31, 2015: Financial Instrument Valuation Technique Unobservable Input(s) Range (Weighted Average) Mortgage Servicing Rights Discounted cash flow Prepayment speed 105-369% (178%) Discount rate 8%-12% (10%) Non-agency Discounted cash flow Discount rate 7%-9% (8%) Generally, any significant increases in the constant prepayment rate and discount rate utilized in the fair value measurement of the mortgage servicing rights will result in a negative fair value adjustment (and decrease in the fair value measurement). Conversely, a decrease in the constant prepayment rate and discount rate will result in a positive fair value adjustment (and increase in the fair value measurement). An increase in the weighted average life assumptions will result in a decrease in the constant prepayment rate and conversely, a decrease in the weighted average life will result in an increase of the constant prepayment rate. The following table provides a reconciliation of assets and liabilities (excluding mortgage servicing rights) measured at fair value using significant unobservable inputs (Level 3) on a recurring basis during the years ended December 31, 2016 and 2015 (in thousands): Year Ended December 31, 2016 2015 Beginning balance, at fair value $ 428 $ 2,345 Principal payments (87 ) (1,947 ) Change in unrealized loss 6 30 Ending balance, at fair value $ 347 $ 428 Mortgage servicing rights are measured at fair value using significant unobservable input (Level 3) on a recurring basis and a reconciliation of this asset can be found in Note 7 – Mortgage Servicing Rights. The following table presents the balance of assets measured at fair value on a nonrecurring basis and the total losses resulting from these fair value adjustments (in thousands): Fair Value at December 31, 2016 Description Total Level 1 Level 2 Level 3 OREO and repossessed assets $ 1,172 $ — $ — $ 1,172 Impaired loans 8,236 — — 8,236 Fair Value at December 31, 2015 Description Total Level 1 Level 2 Level 3 OREO and repossessed assets $ 769 $ — $ — $ 769 Impaired loans 9,220 — — 9,220 There were no liabilities carried at fair value, measured on a recurring or nonrecurring basis, at December 31, 2016 or December 31, 2015. The following table provides a description of the valuation technique, observable input, and qualitative information about the unobservable inputs for the Company’s assets and liabilities classified as Level 3 and measured at fair value on a nonrecurring basis at December 31, 2016: Financial Instrument Valuation Technique(s) Unobservable Input(s) Range (Weighted Average) OREO Market approach Adjusted for difference 0-0% (0%) Impaired loans Market approach Adjusted for difference 0-100% (10.5%) The following table provides a description of the valuation technique, observable input, and qualitative information about the unobservable inputs for the Company’s assets and liabilities classified as Level 3 and measured at fair value on a nonrecurring basis at December 31, 2015: Financial Instrument Valuation Technique(s) Unobservable Input(s) Range (Weighted Average) OREO Market approach Adjusted for difference 0-57% (7%) Impaired loans Market approach Adjusted for difference 0-100% (7%) A description of the valuation methodologies used for impaired loans and OREO is as follows: Impaired Loans OREO and Repossessed Assets The following methods and assumptions were used to estimate the fair value of financial instruments: Cash and cash equivalents, accrued interest receivable and payable AFS Securities Loans Held-for-Sale Loans Mortgage Servicing Rights FHLB stock Bank-owned Life Insurance Deposits Borrowings Off-balance-sheet financial instruments The Company assumes interest rate risk (the risk that general interest rate levels will change) as a result of its normal operations. As a result, the fair values of the Company’s financial instruments will change when interest rate levels change, which may be favorable or unfavorable to it. Management attempts to match maturities of assets and liabilities to the extent necessary or possible to minimize interest rate risk. However, borrowers with fixed-rate obligations are less likely to prepay in a rising rate environment and more likely to prepay in a falling rate environment. Conversely, depositors who are receiving fixed rates are more likely to withdraw funds before maturity in a rising rate environment and less likely to do so in a falling rate environment. Management monitors rates and maturities of assets and liabilities and attempts to minimize interest rate risk by establishing early withdrawal penalties for certificates of deposit, creating interest rate floors for certain variable rate loans, adjusting terms of new loans and deposits, by borrowing at fixed rates for fixed terms and investing in securities with terms that mitigate the Company’s overall interest rate risk. |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 12 – Earnings Per Share Basic earnings per common share is computed by dividing net income (which has been adjusted for distributed and undistributed earnings to participating securities) by the weighted-average number of common shares outstanding for the period, reduced for average unallocated ESOP shares and average unvested restricted stock awards. Unvested share-based awards that contain non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities and are included in the computation of earnings per share pursuant to the two-class method described in ASC 260-10-45-60B. Diluted earnings per common share reflects the potential dilution that could occur if securities or other contracts to issue common stock (such as stock awards and options) were exercised or converted to common stock, or resulted in the issuance of common stock that then shared in the Company’s earnings. Diluted earnings per common share is computed by dividing net income by the weighted-average number of common shares outstanding for the period increased for the dilutive effect of unexercised stock options and unvested restricted stock awards. The dilutive effect of the unexercised stock options and unvested restricted stock awards is calculated under the treasury stock method utilizing the average market value of the Company’s stock for the period. If calculated under the two-class method, which assumes the participating securities are not exercised, the difference in EPS is not significant. Earnings per share are summarized in the following table (all figures in thousands except earnings per share): Years Ended December 31, 2016 2015 Net income $ 5,378 $ 4,790 Weighted average number of shares outstanding, basic 2,487 2,492 Effect of potentially dilutive common shares (1) 80 88 Weighted average number of shares outstanding, diluted 2,567 2,580 Earnings per share, basic $ 2.16 $ 1.92 Earnings per share, diluted $ 2.09 $ 1.86 (1) Represents the effect of the assumed exercise of stock options and vesting of non-participating restricted shares, based on the treasury stock method. There were no anti-dilutive securities at December 31, 2016 or 2015. |
Employee Benefits
Employee Benefits | 12 Months Ended |
Dec. 31, 2016 | |
Employee Benefits [Abstract] | |
Employee Benefits | Note 13 – Employee Benefits The Company has a 401(k) pension plan that allows employees to defer a portion of their salary into the 401(k) plan. The Company matches a portion of employees’ salary deferrals. Pension costs are accrued and funded on a current basis. The Company contributed $139,000 and $135,000 to the plan for the years ended December 31, 2016 and 2015, respectively. The Company also offers a deferred compensation plan for designated senior managers, which provides benefits payable at age 65. Under certain circumstances, benefits are payable to designated beneficiaries. Contributions to the plan are discretionary, and monies set aside to fund the plan are currently held in certificate of deposit accounts at the Company and at December 31, 2016 and 2015 approximated $102,000 and $102,000, respectively. The Company made no contributions to the plan for the years ended December 31, 2016 and 2015. Supplemental Executive Retirement Plans. The Company maintains two supplemental executive retirement plans for the benefit of Ms. Stewart, which are intended to be unfunded, non-contributory defined benefit plans maintained primarily to provide her with supplemental retirement income. The first supplemental executive retirement plan (“SERP 1”) was effective as of August 2007. The second supplemental executive retirement plan (“SERP 2”) was effective as of December 30, 2011, at which time the benefits under SERP 1 were frozen. At that time, the Company also entered into a Confidentiality, Non-Competition, and Non-Solicitation Agreement with Ms. Stewart, which is discussed below. Under the terms of SERP 1, as amended, Ms. Stewart is entitled to receive $53,320 per year for life commencing on the first day of the month following her separation from service (as defined in SERP 1) for any reason from Sound Community Bank.No payments will be made under SERP 1 in the event of Ms. Stewart’s death and any payments that have commenced will cease upon death. In the event Ms. Stewart is involuntarily terminated in connection with a change in control (as defined in SERP 1), she will be entitled to receive the annual benefit described in the first sentence of this paragraph commencing upon such termination (subject to any applicable cutback for payments after a change in control as required by Section 280G of the Internal Revenue Code). Under the terms of SERP 2, as amended, upon Ms. Stewart’s termination of employment with Sound Community Bank for any reason other than death, she will be entitled to receive additional retirement benefits of $78,030 per year for life commencing on the first day of the month following the later of age 70 or her separation from service (as defined in SERP 2) from Sound Community Bank. In the event of Ms. Stewart’s death, her beneficiary will be entitled to a single lump sum payment within 90 days thereafter in an amount equal to the account value as of the death benefit valuation date, or approximately $1.0 million at December 31, 2016. If a change in control occurs (as defined in SERP 2), Ms. Stewart will receive her full retirement benefit under SERP 2 commencing upon the first day of the month following her separation from service from Sound Community Bank. Confidentiality, Non-Competition, and Non-Solicitation Agreement. Effective December 30, 2011, Sound Community Bank entered into a Confidentiality, Non-competition, and Non-solicitation Agreement (the “Non-compete Agreement”) with Ms. Stewart. The Non-compete Agreement commences upon Ms. Stewart’s termination of employment with us and expires upon the earlier of (a) 36 months from the date of Ms. Stewart’s separation from service (as defined in the Non-compete Agreement”) or (b) the date she begins receiving retirement benefits under the SERP 2, which time frame is referred to as the “Restricted Period.” In consideration of Ms. Stewart’s non-competition and non-solicitation obligations under the Non-compete Agreement, Ms. Stewart will be entitled to receive a bi-monthly payment, in an amount equal to $3,541.67, which amount shall be paid in equal bi-monthly payments during the Restricted Period beginning on the fifth day of the month following her separation from service with Sound Community Bank, except if her termination of employment occurs for good reason (as defined in the Non-compete Agreement). In the event Ms. Stewart employment terminates for good reason, she will be entitled to receive an amount equal to 150 percent of her then-base salary plus the average of her past three years short term bonus pay, or approximately $719,000 at December 31, 2016, payable in 12 monthly installments beginning on the first day of the month following her termination. If Ms. Stewart terminates her employment with us for good reason within 24 months following a change in control (as defined in the Non-compete Agreement), Ms. Stewart will be entitled to receive the amount described in the preceding sentence, but payable in a lump sum. Ms. Stewart’s benefits under the Non-compete Agreement are forfeited if she breaches the terms of the agreement. No payments will be made under the agreement if Ms. Stewart’s employment ceases on account of her disability or death (and payments that have commenced will cease upon death), or if she is otherwise ineligible to work in the financial product or services industry. Stock Options and Restricted Stock The Company currently has two existing Equity Incentive Plans, a 2008 Equity Inventive Plan (the”2008 Plan”) and a 2013 Equity Incentive Plan (the “2013 Plan”, and together with the 2008 Plan (the “Plans”)), both of which were approved by shareholders. The Plans permit the grant of restricted stock, restricted stock units, stock options, and stock appreciation rights. Under the 2008 Plan, 126,287 shares of common stock were approved for awards for stock options and stock appreciation rights and 50,514 shares of common stock were approved for awards for restricted stock and restricted stock units. Under the 2013 Plan, 141,750 shares of common stock were approved for awards for stock options and stock appreciation rights and 56,700 shares of common stock were approved for awards for restricted stock and restricted stock units. As of December 31, 2016, on an adjusted basis, awards for stock options totaling 234,391 shares and awards for restricted stock totaling 106,637 shares of Company common stock have been granted, net of any forfeitures, to participants in the Plan. During the years ended December 31, 2016 and 2015, share-based compensation expense totaled $525,000 and $418,000, respectively. Stock Option Awards The stock option awards granted to date under the 2008 Plan vest in 20 percent annual increments commencing one year from the grant date in accordance with the requirements of the 2008 Plan. The stock option awards granted to date under the 2013 Plan vest in equal annual installments of either two or four years. All of the options granted are exercisable for a period of 10 years from the date of grant, subject to vesting. The following is a summary of the Company’s stock option plan award activity during the period ended December 31, 2016: Shares Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term In Years Aggregate Intrinsic Value Outstanding at the beginning of the year 184,407 $ 14.56 5.51 $ 2,478,430 Granted 10,993 22.31 Exercised (21,856 ) 10.66 Forfeited (3,487 ) 17.23 Expired — Outstanding at December 31, 2016 170,057 15.41 6.44 $ 2,141,018 Exercisable 94,382 13.44 5.54 $ 1,374,202 Expected to vest, assuming a 0% forfeiture rate over the vesting term 75,675 $ 17.87 6.61 $ 766,588 As of December 31, 2016, there was $309,000 of total unrecognized compensation cost related to non-vested stock options granted under the Plan. The cost is expected to be recognized over the remaining weighted-average vesting period of 2.13 years. The fair value of each option grant is estimated as of the grant date using the Black-Scholes option-pricing model. The fair value of options granted in 2016 was determined using the following weighted-average assumptions as of the grant date. Annual dividend yield 1.03% Expected volatility 25.48 % Risk-free interest rate 1.64% Expected term 6.92 years Weighted-average grant date fair value per option granted $5.78 Restricted Stock Awards The fair value of the restricted stock awards is equal to the fair value of the Company’s stock at the date of grant. Compensation expense is recognized over the vesting period that the awards are based. The restricted stock awards granted to date under the 2008 Plan provide for vesting in 20 percent annual increments commencing one year from the grant date. The restricted stock awards granted to date under the 2013 Plan provide for immediate vesting of 33.33% of a recipient’s award with the balance of an individual’s award under the 2013 Plan vesting in two equal annual installments commencing one year from the grant date. The following is a summary of the Company’s non-vested restricted stock awards for the year ended December 31, 2016: Non-vested Shares Shares Weighted- Average Grant- Date Fair Value Per Share Aggregate Intrinsic Value Per Share Non-vested at January 1, 2016 31,553 $ 16.32 Granted 11,606 22.31 Vested (15,962 ) 17.59 Forfeited (1,059 ) 17.36 Expired — Non-vested at December 31, 2016 26,138 $ 18.08 $ 28.00 Expected to vest assuming a 0% forfeiture rate over the vesting term 26,138 $ 18.08 $ 28.00 As of December 31, 2016, there was $310,000 of unrecognized compensation cost related to non-vested restricted stock granted under the Plan. The cost is expected to be recognized over the weighted-average vesting period of 1.03 years. The total fair value of shares vested for the years ended December 31, 2016 and 2015 was $272,000 and $211,000, respectively. Employee Stock Ownership Plan In January 2008, the ESOP borrowed $1.2 million from the Company to purchase common stock of the Company. In August 2012, in conjunction with the Company’s conversion to a full stock company from the mutual holding company structure, the ESOP borrowed an additional $1.1 million from the Company to purchase common stock of the Company. Both loans are being repaid principally by the Bank through contributions to the ESOP over a period of ten years. The interest rate on the loans is fixed at 4.00% and 2.25%, per annum, respectively. As of December 31, 2016, the remaining balances of the ESOP loans were $136,000 and $590,000, respectively. Neither the loan balances nor the related interest expense are reflected on the condensed consolidated financial statements. At December 31, 2016, the ESOP was committed to release 21,443 shares of the Company’s common stock to participants and held 66,800 unallocated shares remaining to be released in future years. The fair value of the 183,469 restricted shares held by the ESOP trust was $5.1 million at December 31, 2016. ESOP compensation expense included in salaries and benefits was $491,000 and $448,000 for the years ended December 31, 2016 and 2015, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Taxes [Abstract] | |
Income Taxes | Note 14 – Income Taxes The provision for income taxes at December 31, 2016 and 2015 was as follows (in thousands): At December 31, 2016 2015 Current $ 2,718 $ 2,648 Deferred (23 ) (359 ) Total tax expense $ 2,695 $ 2,289 A reconciliation of the provision for income taxes for the years ended December 31, 2016 and 2015 with amounts determined by applying the statutory U.S. federal income tax rate to income before income taxes is as follows (dollars in thousands): Years Ended December 31, 2016 2015 Provision at statutory rate $ 2,745 $ 2,407 Tax-exempt income (76 ) (63 ) Other 26 (55 ) 2,695 2,289 Federal Tax Rate 34.0 % 34.0 % Tax exempt rate (0.9 ) (0.9 ) Other 0.3 (0.8 ) Effective tax rate 33.4 % 32.3 % The following table reflects the temporary differences that gave rise to the components of the Company’s deferred tax assets at December 31, 2016 and 2015 (in thousands): At December 31, 2016 2015 Deferred tax assets Deferred compensation and supplemental retirement $ 444 $ 437 Other, net 182 164 Equity based compensation 117 90 Allowance for loan losses 912 641 Total deferred tax assets 1,655 1,332 Deferred tax liabilities Prepaid expenses (86 ) (79 ) FHLB stock dividends (141 ) (142 ) Unrealized gain on securities (42 ) (84 ) Depreciation (128 ) (112 ) Intangible assets (4 ) (3 ) Mortgage servicing rights (114 ) (55 ) Deferred loan costs (539 ) (322 ) Total deferred tax liabilities (1,054 ) (797 ) Net deferred tax asset $ 601 $ 535 As of December 31, 2016 and 2015, the Company had no unrecognized tax benefits. The Company recognizes interest accrued and penalties related to unrecognized tax benefits in “Provision for income taxes” in the Consolidated Statements of Income. During the years ended December 31, 2016 and 2015, the Company recognized no interest and penalties. The Company or its subsidiary files an income tax return in the U.S. federal jurisdiction. With few exceptions, the Company is no longer subject to U.S. federal income tax examinations by tax authorities for years before 2013. |
Minimum Regulatory Capital Requ
Minimum Regulatory Capital Requirements | 12 Months Ended |
Dec. 31, 2016 | |
Minimum Regulatory Capital Requirements [Abstract] | |
Minimum Regulatory Capital Requirements | Note 15 – Minimum Regulatory Capital Requirements The Federal Reserve and the FDIC approved final capital rules in July 2013 that substantially amended the existing capital rules for banks. These rules reflect, in part, certain standards initially adopted by the Basel Committee on Banking Supervision in December 2010 (which standards are commonly referred to as “Basel III”) as well as requirements contemplated by the Dodd-Frank Wall Street Reform and Consumer Protection Act. Under the amended capital rules, there is a capital ratio of common equity Tier 1 (“CET1) capital to risk-weighted assets ratio. CET1 capital generally consists of retained earnings and common stock (subject to certain adjustments). In March 2015, the Bank exercised a one ‐ Quantitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum amounts and ratios (set forth in the following table) of total and Tier 1 capital (as defined in the regulations) to risk-weighted assets (as defined in the regulations) and Tier 1 capital to average assets (as defined in the regulations). The Bank’s actual capital amounts (in thousands) and ratios as of December 31, 2016 and 2015 are presented in the following table: Actual Minimum Capital Requirements Minimum Required to Be Well-Capitalized Under Prompt Corrective Action Provisions Amount Ratio Amount Ratio Amount Ratio As of December 31, 2016 Tier 1 Capital to total adjusted assets (1) $ 57,406 9.99 % $ 22,992 ≥ 4.0 % $ 28,740 ≥ 5.0 % Common Equity Tier 1 risk-based capital ratio (2) $ 57,406 12.02 % $ 21,490 ≥ 4.5 % $ 31,041 ≥ 6.5 % Tier 1 Capital to risk-weighted assets (2) $ 57,406 12.02 % $ 28,653 ≥ 6.0 % $ 38,204 ≥ 8.0 % Total Capital to risk-weighted assets (2) $ 62,423 13.07 % $ 38,204 ≥ 8.0 % $ 47,755 ≥ 10.0 % As of December 31, 2015 Tier 1 Capital to total adjusted assets (3) $ 53,041 10.19 % $ 20,812 ≥ 4.0 % $ 26,015 ≥ 5.0 % Common Equity Tier 1 risk-based capital ratio (4) $ 53,041 11.70 % $ 20,401 ≥ 4.5 % $ 29,467 ≥ 6.5 % Tier 1 Capital to risk-weighted assets (4) $ 53,041 11.70 % $ 27,201 ≥ 6.0 % $ 36,268 ≥ 8.0 % Total Capital to risk-weighted assets (4) $ 57,677 12.74 % $ 36,268 ≥ 8.0 % $ 45,335 ≥ 10.0 % (1) Based on total adjusted assets of $574,792 at December 31, 2016. (2) Based on risk-weighted assets of $477,548 at December 31, 2016. (3) Based on total adjusted assets of $520,307 at December 31, 2015. (4) Based on risk-weighted assets of $453,345 at December 31, 2015. In addition to the minimum CET1, Tier 1 and total capital ratios, the Bank now has to maintain a capital conservation buffer consisting of additional CET1 capital above the required minimum levels in order to avoid limitations on paying dividends, engaging in share repurchases, and paying discretionary bonuses based on percentages of eligible retained income that could be utilized for such actions. This new capital conservation buffer requirement began to be phased in January 2016 at 0.625% of risk-weighted assets and will increase each year until fully implemented to an amount equal to 2.5% of risk-weighted assets in January 2019. |
Concentrations of Credit Risk
Concentrations of Credit Risk | 12 Months Ended |
Dec. 31, 2016 | |
Concentrations of Credit Risk [Abstract] | |
Concentrations of Credit Risk | Note 16 – Concentrations of Credit Risk Most of the Company’s business activity is with customers located in the state of Washington. A substantial portion of the loan portfolio is represented by real estate loans throughout western Washington. The ability of the Company’s debtors to honor their contracts is dependent upon the real estate and general economic conditions in the area. Loans to one borrower are generally limited by federal banking regulations to 15% of the Company’s unimpaired capital and surplus. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | Note 17 – Commitments and Contingencies The Company is a party to financial instruments with off-balance-sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments generally represent a commitment to extend credit in the form of loans. The instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the consolidated balance sheets. The Company’s exposure to credit loss, in the event of nonperformance by the other party to the financial instrument for commitments to extend credit, is represented by the contractual notional amount of those instruments. The Company uses the same credit policies in making commitments as it does for on-balance-sheet instruments. Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established by the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Because many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Company evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if it is deemed necessary by the Company, is based on management’s credit evaluation of the customer. Financial instruments whose contract amount represents credit risk were as follow (in thousands): At December 31, 2016 2015 Commitments to make loans $ 3,942 $ 6,037 Unfunded construction commitments 33,916 32,951 Unused lines of credit 24,753 19,925 Irrevocable letters of credit 185 185 Total loan commitments $ 62,796 $ 59,098 At December 31, 2016, fixed rate loan commitments totaled $5.8 million and had a weighted average interest rate of 4.02%. At December 31, 2015, fixed rate loan commitments totaled $6.0 million and had a weighted average interest rate of 4.00%. Commitments for credit may expire without being drawn upon. Therefore, the total commitment amount does not necessarily represent future cash requirements of the Company. These commitments are not reflected in the financial statements. At December 31, 2016, the Company had letters of credit issued by the FHLB with a notional amount of $21.0 million in order to secure Washington State Public Funds. In the ordinary course of business, the Company sells loans without recourse that may have to be subsequently repurchased due to defects that occurred during the origination of the loan. The defects are categorized as documentation errors, underwriting errors, early payment defaults, and fraud. When a loan sold to an investor without recourse fails to perform, the investor will typically review the loan file to determine whether defects in the origination process occurred. If a defect is identified, the Company may be required to either repurchase the loan or indemnify the investor for losses sustained. If there are no defects, the Company has no commitment to repurchase the loan. As of December 31, 2016 and 2015, the maximum amount of these guarantees totaled $410.1 million and $360.4 million, respectively. These amounts represent the unpaid principal balances of the Company’s loans serviced for others’ portfolios. There were no loans repurchased during the years ended December 31, 2016 or December 31, 2015. The Company pays certain medical, dental, prescription, and vision claims for its employees, on a self-insured basis. The Company has purchased stop-loss insurance to cover claims that exceed stated limits and has recorded estimated reserves for the ultimate costs for both reported claims and claims incurred but not reported, which are not considered significant at December 31, 2016 or 2015. At various times, the Company may be the defendant in various legal proceedings arising in connection with its business. It is the opinion of management that the financial position and the results of operations of the Company will not be materially adversely affected by the outcome of these legal proceedings and that adequate provision has been made in the accompanying consolidated financial statements. |
Parent Company Financial Inform
Parent Company Financial Information | 12 Months Ended |
Dec. 31, 2016 | |
Parent Company Financial Information [Abstract] | |
Parent Company Financial Information | Note 18 – Parent Company Financial Information The Balance Sheets, Statements of Income, and Statements of Cash Flows for Sound Financial Bancorp (Parent Only) are presented below (dollars in thousands): Balance sheets December 31, 2016 2015 Assets Cash and cash equivalents $ 1,916 $ 451 Investment in Sound Community Bank 57,699 53,483 Other assets 660 586 Total assets $ 60,275 $ 54,520 Liabilities and Stockholders’ Equity Other liabilities — — Total liabilities — — Stockholders’ equity 60,275 54,520 Total liabilities and stockholders’ equity $ 60,275 $ 54,520 Statements of Income Year Ended December 31, 2016 2015 Interest income $ — $ — Dividend from subsidiary 1,750 1,200 Other expenses (220 ) (244 ) Income before income tax benefit and equity in undistributed net Income of subsidiary 1,530 956 Income tax benefit 75 83 Equity in undistributed earnings of subsidiary 3,773 3,751 Net income $ 5,378 $ 4,790 Statements of Cash Flows Year Ended December 31, 2016 2015 Cash flows from operating activities: Net income $ 5,378 $ 4,790 Adjustments to reconcile net income to net cash provided by operating activities Other, net (75 ) 312 Change in undistributed equity of subsidiary (3,773 ) (3,751 ) Net cash used by operating activities 1,530 1,351 Cash flows from investing activities: Net proceeds from ESOP 515 457 Net cash provided by investing activities 515 457 Cash flows from financing activities: Dividends paid (745 ) (574 ) Excess tax benefit of stock compensation — — Common stock exercised 165 65 Common stock repurchased — (1,261 ) Net cash used by financing activities (580 ) (1,770 ) Net increase in cash 1,465 38 Cash and cash equivalents at beginning of year 451 413 Cash and cash equivalents at end of year $ 1,916 $ 451 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 19 – Subsequent Events On January 30, 2017, the Company declared a quarterly cash dividend of $0.10 per common share, payable February, 27 2017 to shareholders of record at the close of business February 13, 2017. On October 28, 2016, the Company announced that the Bank had entered into an agreement to purchase from Sunwest Bank a branch located at 4922 Bridgeport Way West, University Place, Washington (the “University Place Branch”). The Bank expects to acquire approximately $15.9 million of deposits for a core deposit premium of 3.35%. The Bank is not acquiring any loans as part of the transaction. The cost of funds from the University Place Branch is approximately 17 basis points and the cash received is expected to be used to pay down FHLB borrowings. The Bank expects to retain the current branch staff at the University Place Branch. The transaction is expected to close in the second calendar quarter of 2017, following satisfaction of customary closing conditions. |
Organization and Significant 29
Organization and Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Organization and Significant Accounting Policies [Abstract] | |
Subsequent events | Subsequent events – |
Basis of Presentation and Use of Estimates | Basis of Presentation and Use of Estimates The accompanying consolidated financial statements include the accounts of Sound Financial Bancorp and its wholly-owned subsidiary Sound Community Bank. All significant intercompany balances and transactions between Sound Financial Bancorp and its subsidiary have been eliminated in consolidation. |
Cash and cash equivalents | Cash and cash equivalents |
Investment securities | Investment securities Unrealized gains and losses, net of the related deferred tax effect, are reported as a net amount in accumulated other comprehensive income (loss) on AFS securities in the consolidated balance sheets. Realized gains and losses on AFS securities, determined using the specific identification method, are included in earnings. Amortization of premiums and accretion of discounts are recognized as adjustments to interest income using the interest method over the period to maturity. The Company reviews investment securities on an ongoing basis for the presence of other-than-temporary impairment (“OTTI”) or permanent impairment, taking into consideration current market conditions, fair value in relation to cost, extent and nature of the change in fair value, issuer rating changes and trends, whether the Company intend to sell a security or if it is likely that the Company will be required to sell the security before recovery of its amortized cost basis of the investment, which may be maturity, and other factors. For debt securities, if the Company intends to sell the security or it is likely that it will be required to sell the security before recovering its cost basis, the entire impairment loss would be recognized in earnings as an OTTI. If the Company does not intend to sell the security and it is not likely that we will be required to sell the security but we do not expect to recover the entire amortized cost basis of the security, only the portion of the impairment loss representing credit losses would be recognized in earnings. The credit loss on a security is measured as the difference between the amortized cost basis and the present value of the cash flows expected to be collected. Projected cash flows are discounted by the original or current effective interest rate depending on the nature of the security being measured for potential OTTI. The remaining impairment related to all other factors, the difference between the present value of the cash flows expected to be collected and the fair value, is recognized as a charge to other comprehensive income (“OCI”). The Company does not intend to sell these securities and it is more likely than not that it will not be required to sell the securities before anticipated recovery of the remaining amortized cost basis. The Company closely monitors its investment securities for changes in credit risk. The current market environment significantly limits the Company’s ability to mitigate its exposure to valuation changes in these securities by selling them. Accordingly, if market conditions deteriorate further and the Company determines its holdings of these or other investment securities are OTTI, its future earnings, stockholders’ equity, regulatory capital and continuing operations could be materially adversely affected. |
Loans held-for-sale | Loans held-for-sale |
Loans | Loans Loans that management has the intent and ability to hold for the foreseeable future or until maturity or pay-off generally are reported at their outstanding unpaid principal balances adjusted for any charge-offs, the allowance for loan losses, and any deferred fees or costs on origination of loans. Interest income is accrued on the unpaid principal balance. Loan origination fees, net of certain direct origination costs, are deferred and recognized as an adjustment of the related loan yield using the interest method over the contractual life of the loan for term loans or the straight-line method for open ended loans. The accrual of interest is discontinued at the time the loan is three months past due or if, in management’s opinion, the borrower may be unable to meet payment of obligations as they become due, as well as when required by regulatory provisions. Loans are typically charged off no later than 120 days past due, unless secured by collateral. Past due status is based on contractual terms of the loan. In all cases, loans are placed on nonaccrual or charged off at an earlier date if collection of principal or interest is considered doubtful. All interest accrued but not collected for loans that are placed on nonaccrual or charged off is reversed against interest income. The interest on these loans is accounted for on the cash-basis or cost-recovery method, until qualifying for return to accrual. Loans are returned to accrual status when all of the principal and interest amounts contractually due are brought current, future payments are reasonably assured and payments have been received for twelve consecutive months. A loan is considered impaired when it is probable that the Company will be unable to collect all amounts (principal and interest) due according to the contractual terms of the original loan agreement. When a loan has been identified as being impaired, the amount of the impairment is measured by using discounted cash flows, except when, as a practical expedient, the current fair value of the collateral, reduced by costs to sell, is used. When the measurement of the impaired loan is less than the recorded investment in the loan (including accrued interest), impairment is recognized by charging off the impaired portion or creating or adjusting a specific allocation of the allowance for loan losses. A loan is classified as a troubled debt restructuring (“TDR”) when certain concessions have been made to the contractual terms, such as reductions of interest rates or deferrals of interest or principal payments due to the borrower’s deteriorated financial condition. All TDRs are reported and accounted for as impaired loans. |
Allowance for loan losses | Allowance for loan losses The allowance for loan losses is maintained at a level sufficient to provide for probable credit losses based upon evaluating known and inherent risks in the loan portfolio. The allowance is provided based upon management’s continuing analysis of the pertinent factors underlying the quality of the loan portfolio. These factors include changes in the size and composition of the loan portfolio, delinquency levels, actual loan loss experience, current economic conditions, and detailed analysis of individual loans for which full collectability may not be assured. The detailed analysis includes techniques to estimate the fair value of loan collateral and the existence of potential alternative sources of repayment. The allowance consists of specific, general, and unallocated components. The specific component relates to loans that are classified as doubtful, substandard, or special mention. The Company considers installment loans to be pools of smaller balance, homogenous loans that are collectively evaluated for impairment, unless such loans are subject to a TDR agreement. For such loans that are also classified as impaired, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan are lower than the carrying value of that loan. The general component covers non-classified loans and is based upon historical loss experience adjusted for qualitative factors. An unallocated component is maintained to cover uncertainties that could affect management’s estimate of probable losses. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating specific and general losses in the portfolio. The appropriateness of the allowance for loan losses is estimated based upon those factors and trends identified by management at the time consolidated financial statements are prepared. When available information confirms that specific loans or portions thereof are uncollectible, identified amounts are charged against the allowance for loan losses. The existence of some or all of the following criteria will generally confirm that a loss has been incurred: the loan is significantly delinquent and the borrower has not demonstrated the ability or intent to bring the loan current; the Company has no recourse to the borrower, or if it does, the borrower has insufficient assets to pay the debt; the estimated fair value of the loan collateral is significantly below the current loan balance, and there is little or no near-term prospect for improvement. The ultimate recovery of all loans is susceptible to future market factors beyond the Company’s control. These factors may result in losses or recoveries differing significantly from those provided in the consolidated financial statements. In addition, regulatory agencies, as an integral part of their examination process, periodically review the Company’s allowance for loan losses, and may require the Company to make additions to the allowance based on their judgment about information available to them at the time of their examinations. |
Transfers of financial assets | Transfers of financial assets |
Mortgage servicing rights ("MSR") | Mortgage servicing rights (“MSR”) |
Premises and equipment | Premises and equipment |
Bank-owned life insurance, net | Bank-owned life insurance, net |
Federal Home Loan Bank stock | Federal Home Loan Bank stock |
Other real estate owned and repossessed assets | Other real estate owned and repossessed assets In some instances, the Company may make loans to facilitate the sales of OREO. Management reviews all sales for which it is the lending institution. Any gains related to sales of other real estate owned may be deferred until the buyer has a sufficient investment in the property. |
Income Taxes | Income Taxes |
Segment reporting | Segment reporting |
Off-balance-sheet credit-related financial instruments | Off-balance-sheet credit-related financial instruments |
Advertising costs | Advertising costs |
Comprehensive income | Comprehensive income |
Intangible assets | Intangible assets |
Employee stock ownership plan | Employee stock ownership plan Unearned ESOP shares are shown as a reduction of stockholders’ equity. When the shares are released, unearned common shares held by the ESOP are reduced by the cost of the ESOP shares released and the differential between the fair value and the cost is charged to additional paid in capital. The loan receivable from the ESOP to the Company is not reported as an asset nor is the debt of the ESOP reported as a liability on the Company’s Consolidated Statements of Condition. |
Earnings Per Common Share | Earnings Per Common Share |
Fair value | Fair value Fair values of the Company’s financial instruments are based on the fair value hierarchy which requires an entity to maximize the use of observable inputs, typically market data obtained from third parties, and minimize the use of unobservable inputs, which reflects its estimates for market assumptions, when measuring fair value. Three levels of valuation inputs are ranked in accordance with the prescribed fair value hierarchy as follows: Level 1: Level 2: Level 3: In determining the appropriate levels, the Company performs a detailed analysis of the assets and liabilities that are subject to fair value measurements. In certain cases, the inputs used to measure fair value of an asset or liability may fall into different levels of the fair value hierarchy. The level within which the fair value measurement is categorized is based on the lowest level unobservable input that is significant to the fair value measurement in its entirety. Therefore, an item may be classified in Level 3 even though there may be some significant inputs that are readily observable. |
Share-Based Compensation | Share-Based Compensation |
Reclassifications | Reclassifications |
Accounting Pronouncements Rec30
Accounting Pronouncements Recently Issued or Adopted (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Pronouncements Recently Issued or Adopted [Abstract] | |
New Accounting Pronouncements | In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606), which creates Topic 606 and supersedes Topic 605, Revenue Recognition. In August 2015, FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606), which postponed the effective date of 2014-09. In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net, which amended the principal versus agent implementation guidance set for in ASU 2014-09. Among other things, ASU 2016-08 clarifies that an entity should evaluate whether it is the principal or the agent for each specified good or service promised in a contract with a customer. In April 2016, the FASB issued ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing. The ASU amends certain aspects of the guidance set forth in the FASB’s new revenue standard related to identifying performance obligations and licensing implementation. The core principle of Topic 606 is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In general, the new ASU requires companies to use more judgment and make more estimates than under current guidance, including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. In May 2016, the FASB issued ASU No. 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients, which provides clarifying guidance in certain narrow areas and adds some practical expedients, but does not change the core revenue recognition principle in Topic 606. This ASU is effective for interim and annual periods beginning after December 15, 2017; early adoption is not permitted. For financial reporting purposes, the ASU allows for either full retrospective adoption, meaning this ASU is applied to all of the periods presented, or modified retrospective adoption, meaning the ASU is applied only to the most current period presented in the financial statements with the cumulative effect of initially applying the ASU is recognized at the date of initial application. As a financial institution, the Company's largest component of revenue, interest income, is excluded from the scope this ASU. The Company is currently evaluating the provisions to determine the potential impact the new standard will have on the Company’s consolidated financial statements. In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments - Overall (Subtopic 825-10), Recognition and Measurement of Financial Assets and Financial Liabilities. The new guidance is intended to improve the recognition and measurement of financial instruments. This ASU requires equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income. In addition, the ASU requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes and requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset (i.e., securities or loans and receivables) on the balance sheet or the accompanying notes to the financial statements. This ASU also eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet. The ASU also requires a reporting organization to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument specific credit risk (also referred to as “own credit”) when the organization has elected to measure the liability at fair value in accordance with the fair value option for financial instruments. ASU No. 2016-01 is effective for financial statements issued for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted for certain provisions. The Company is currently evaluating the impact of this ASU on the Company's consolidated financial statements. In February 2016, FASB issued ASU No. 2016-02, Leases (Topic 842). ASU No. 2016-02 requires lessees to recognize, on the balance sheet, the assets and liabilities arising from operating leases. A lessee should recognize a liability to make lease payments and a right-of-use asset representing its right to use the underlying asset for the lease term. A lessee should include payments to be made in an optional period only if the lessee is reasonably certain to exercise an option to extend the lease or not to exercise an option to terminate the lease. For a finance lease, interest payments should be recognized separately from amortization of the right-of-use asset in the statement of comprehensive income. For operating leases, the lease cost should be allocated over the lease term on a generally straight-line basis. The amendments in ASU 2016-02 are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early application of the amendments in the ASU is permitted. Although an estimate of the impact of the new leasing standard has not yet been determined, the Company expects a significant new lease asset and related lease liability on the balance sheet due to the number of leased properties the Bank currently has that are accounted for under current operating lease guidance. In March 2016, the FASB issued ASU No. 2016-06, Derivatives and Hedging (Topic 815): Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships. A contract novation refers to replacing one of the parties to a derivative instrument with a new party. This ASU clarifies that a change in counterparty in a derivative instrument does not, in and of itself, require re-designation of that hedging relationship and therefore discontinue the application of hedge accounting. ASU 2016-05 is effective for financial statements issued for fiscal years beginning after December 15, 2016, and interim periods within those fiscal years. Early adoption is permitted in any interim or annual period. The adoption of ASU 2016-05 is not expected to have a material impact on the Company’s consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, Improvements to Employee Share-Based Payment Accounting, which amends ASC Topic 718, Compensation - Stock Compensation. The ASU includes provisions intended to simplify various aspects related to how share-based payments are accounted for and presented in the financial statements. The ASU is effective for annual and interim periods beginning after December 15, 2016. The adoption of ASU is being reviewed for any material impact there may be on the Company’s consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments- Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This ASU replaces the existing incurred loss impairment methodology that recognizes credit losses when a probable loss has been incurred with new methodology where loss estimates are based upon lifetime expected credit losses. The amendments in this ASU require a financial asset that is measured at amortized cost to be presented at the net amount expected to be collected. The income statement would then reflect the measurement of credit losses for newly recognized financial assets as well as changes to the expected credit losses that have taken place during the reporting period. The measurement of expected credit losses will be based on historical information, current conditions, and reasonable and supportable forecasts that impact the collectability of the reported amount. Available-for-sale securities will bifurcate the fair value mark and establish an allowance for credit losses through the income statement for the credit portion of that mark. The interest portion will continue to be recognized through accumulated other comprehensive income or loss. The change in allowance recognized as a result of adoption will occur through a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the ASU is adopted. The amendments in this ASU are effective for fiscal years beginning after December 15, 2019 with early adoption permitted after December 15, 2018. The Company has begun the process to implement this new standard by working with a key vendor that specializes in this area. It has yet to be determined what impact this standard will have on the Company's consolidated financial statements. While the Company has not quantified the impact of this ASU, it does expect changing from the current incurred loss model to an expected loss model will result in an earlier recognition of losses In August 2016, FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. This ASU addresses the appropriate classification of eight specific cash flow issues on the cash flow statement. Debt prepayment costs should be classified as an outflow for financing activities. Settlement of zero-coupon debt instruments divides the interest portion as an outflow for operating activities and the principal portion as an outflow for financing activities. Contingent consideration payments made after a business combination should be classified as outflows for financing and operating activities. Proceeds from the settlement of bank-owned life insurance policies should be classified as inflows from investing activities. Other specific areas are identified in the ASU as to the appropriate classification of the cash inflows or outflows. The amendments in this ASU are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early adoption is permitted and must be applied using a retrospective transition method to each period presented. The Company does not expect this ASU to have a material impact on the Company’s consolidated financial statements. In December 2016, FASB issued ASU No. 2016-19, “Technical Corrections and Improvements” and ASU 2016-20, “Technical Corrections and Improvements to Topic 606: Revenue from Contracts with Customers.” On November 10, 2010 FASB added a standing project that will facilitate the FASB Accounting Standards Codification (“Codification”) updates for technical corrections, clarifications, and improvements. These amendments are referred to as Technical Corrections and Improvements. Maintenance updates include non-substantive corrections to the Codification, such as editorial corrections, various link-related changes, and changes to source fragment information. These updates contain amendments that will affect a wide variety of Topics in the Codification. The amendments in these ASUs will apply to all reporting entities within the scope of the affected accounting guidance and generally fall into one of four categories: amendments related to differences between original guidance and the Codification, guidance clarification and reference corrections, simplification, and minor improvements. In summary, the amendments represent changes to clarify the Codification, correct unintended application of guidance, or make minor improvements to the Codification that are not expected to have a significant effect on current accounting practice. Transition guidance varies based on the amendments in the ASUs. The amendments that require transition guidance are effective for fiscal years and interim reporting periods after December 15, 2016. Early adoption is permitted including adoption in an interim period. All other amendments are effective upon the issuance of these ASUs. Neither ASU 2016-19 nor ASU 2016-20 had a material impact on the Company’s consolidated financial statements. In January 2017, FASB issued ASU 2017-03, “Accounting Changes and Error Corrections (Topic 250) and Investments-Equity Method and Joint Ventures (Topic 323).” The ASU amends the Codification for SEC staff announcements made at recent Emerging Issues Task Force (EITF) meetings. The SEC guidance that specifically relates to our Consolidated Financial Statement was from the September 2016 meeting, where the SEC staff expressed their expectations about the extent of disclosures registrants should make about the effects of the new FASB guidance as well as any amendments issued prior to adoption, on revenue (ASU 2014-09), leases (ASU 2016-02) and credit losses on financial instruments (ASU 2016-13) in accordance with SAB Topic 11.M. Registrants are required to disclose the effect that recently issued accounting standards will have on their financial statements when adopted in a future period. In cases where a registrant cannot reasonably estimate the impact of the adoption, then additional qualitative disclosures should be considered. The ASU incorporates these SEC staff views into ASC 250 and adds references to that guidance in the transition paragraphs of each of the three new standards. The adoption of this ASU did not have a material effect on the Company’s consolidated financial statements. In January 2017, FASB issued ASU No. 2017-04, “Simplifying the Test for Goodwill Impairment”. The amendments in this ASU are intended to reduce the cost and complexity of the goodwill impairment test by eliminating Step 2 from the impairment test. The amendments modify the concept of impairment from the condition that exists when the carrying amount of goodwill exceeds its implied fair value to the condition that exists when the carrying amount of a reporting unit exceeds its fair value. Under the amendments in this ASU, an entity will perform its annual, or interim, goodwill impairment test by comparing the fair value of the reporting unit with its carrying amount. An impairment charge should be recognized for the amount which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The amendments in this ASU are effective for the Company’s annual or any interim goodwill impairment test in fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company does not expect this ASU to have a material impact on the Company’s consolidated financial statements. |
Investments (Tables)
Investments (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Investments [Abstract] | |
Amortized Cost and Fair Value of AFS Securities and Corresponding Amounts of Gross Unrealized Gains and Losses | The amortized cost and fair value of AFS securities and the corresponding amounts of gross unrealized gains and losses at December 31, 2016 and 2015 were as follows (in thousands): Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value December 31, 2016 Municipal bonds $ 3,262 $ 127 $ (36 ) $ 3,353 Agency mortgage-backed securities 2,858 49 (3 ) 2,904 Non-agency mortgage-backed securities 362 — (15 ) 347 Total $ 6,482 $ 176 $ (54 ) $ 6,604 December 31, 2015 Municipal bonds $ 1,912 $ 184 $ — $ 2,096 Agency mortgage-backed securities 4,088 102 (18 ) 4,172 Non-agency mortgage-backed securities 449 — (21 ) 428 Total $ 6,449 $ 286 $ (39 ) $ 6,696 |
Amortized Cost and Fair Value of Mortgage-backed Securities by Contractual Maturity | Expected maturities of mortgage-backed securities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. December 31, 2016 Amortized Cost Fair Value Due in less than one year $ — $ — Due in one to five years 1,349 1,313 Due after five to ten years 414 432 Due after ten years 4,719 4,859 Total $ 6,482 $ 6,604 |
Aggregate Fair Value and Gross Unrealized Loss in Continuous Unrealized Loss Position | The following table summarizes at December 31, 2016 and 2015 the aggregate fair value and gross unrealized loss by length of time those investments have been continuously in an unrealized loss position (in thousands): December 31, 2016 Less Than 12 Months 12 Months or Longer Total Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss Municipal bonds $ 1,313 $ (36 ) $ — $ — $ 1,313 $ (36 ) Agency mortgage-backed securities — — 1,125 (3 ) 1,125 $ (3 ) Non-agency mortgage-backed securities — — 347 (15 ) 347 (15 ) Total $ 1,313 $ (36 ) $ 1,472 $ (18 ) $ 2,785 $ (54 ) December 31, 2015 Less Than 12 Months 12 Months or Longer Total Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss Agency mortgage-backed securities $ — $ — $ 1,370 $ (18 ) $ 1,370 $ (18 ) Non-agency mortgage-backed securities — — 428 (21 ) 428 (21 ) Total $ — $ — $ 1,798 $ (39 ) $ 1,798 $ (39 ) |
Cumulative Roll Forward of Credit Losses Recognized in Earnings | The following table presents at December 31, 2016 and 2015 the cumulative roll forward of credit losses recognized in earnings relating to the Company’s non-U.S. agency mortgage backed securities (in thousands): Year Ended December 31, 2016 2015 Estimated credit losses, beginning balance $ — $ 450 Additions for credit losses not previously recognized — — Reduction for increases in cash flows — — Removal of credit losses due to securities sold — (450 ) Estimated credit losses, ending balance $ — $ — |
Loans (Tables)
Loans (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Loans [Abstract] | |
Composition of Loan Portfolio, Excluding Loans Held for Sale | The composition of the loan portfolio, excluding loans held-for-sale, at December 31, 2016 and 2015 is as follows (in thousands): At December 31, 2016 2015 Real estate loans: One- to four- family $ 152,386 $ 141,125 Home equity 27,771 31,573 Commercial and multifamily 181,004 175,312 Construction and land 70,915 57,043 Total real estate loans 432,076 405,053 Consumer loans: Manufactured homes 15,494 13,798 Other consumer (1) 27,928 23,030 Total consumer loans 43,422 36,828 Commercial business loans 26,331 19,295 Total loans 501,829 461,176 Deferred fees (1,828 ) (1,707 ) Total loans, gross 500,001 459,469 Allowance for loan losses (4,822 ) (4,636 ) Total loans, net $ 495,179 $ 454,833 (1) Included in other consumer loans are floating home loans totaling $24.0 million and $18.2 million as of December 31, 2016 and 2015, respectively. |
Allowance for Loan Losses and Recorded Investment in Loans by Portfolio Segment and Based on Impairment Method | The following table presents the balance in the allowance for loan losses and the unpaid principal balance in loans, net of partial charge-offs by portfolio segment and based on impairment method as of December 31, 2016 (in thousands): One-to- four family Home equity Commercial and multifamily Construction and land Manufactured homes Other consumer Commercial business Unallocated Total Allowance for loan losses: Individually evaluated for impairment $ 536 $ 121 $ 24 $ 35 $ 59 $ 65 $ 23 $ — $ 863 Collectively evaluated for impairment 1,006 257 1,120 424 109 179 152 712 3,959 Ending balance $ 1,542 $ 378 $ 1,144 $ 459 $ 168 $ 244 $ 175 $ 712 $ 4,822 Loans receivable: Individually evaluated for impairment $ 4,749 $ 832 $ 1,582 $ 83 $ 312 $ 62 $ 616 $ — $ 8,236 Collectively evaluated for impairment 147,637 26,939 179,422 70,832 15,182 27,866 25,715 — 493,593 Ending balance $ 152,386 $ 27,771 $ 181,004 $ 70,915 $ 15,494 $ 27,928 $ 26,331 $ — $ 501,829 The following table presents the balance in the allowance for loan losses and the unpaid principal balance in loans, net of partial charge-offs by portfolio segment and based on impairment method as of December 31, 2015 (in thousands): One-to- four family Home equity Commercial and multifamily Construction and land Manufactured homes Other consumer Commercial business Unallocated Total Allowance for loan losses: Individually evaluated for impairment $ 647 $ 110 $ 36 $ 18 $ 63 $ — $ 8 $ — $ 882 Collectively evaluated for impairment 1,192 497 885 364 238 188 149 241 3,754 Ending balance $ 1,839 $ 607 $ 921 $ 382 $ 301 $ 188 $ 157 $ 241 $ 4,636 Loans receivable: Individually evaluated for impairment $ 5,779 $ 904 $ 1,966 $ 91 $ 361 $ 5 $ 114 $ — $ 9,220 Collectively evaluated for impairment 135,346 30,669 173,346 56,952 13,437 23,025 19,181 — 451,956 Ending balance $ 141,125 $ 31,573 $ 175,312 $ 57,043 $ 13,798 $ 23,030 $ 19,295 $ — $ 461,176 |
Activity in Allowance for Loan Losses | The following table summarizes the activity in loan losses for the year ended December 31, 2016 (in thousands): Beginning Allowance Charge-offs Recoveries Provision Ending Allowance One-to-four family $ 1,839 $ (72 ) $ 47 $ (272 ) $ 1,542 Home equity 607 (15 ) 78 (292 ) 378 Commercial and multifamily 921 (314 ) — 537 1,144 Construction and land 382 — 18 59 459 Manufactured homes 301 — 8 (141 ) 168 Other consumer 188 (42 ) 53 45 244 Commercial business 157 (29 ) — 47 175 Unallocated 241 — — 471 712 $ 4,636 $ (472 ) $ 204 $ 454 $ 4,822 The following table summarizes the activity in loan losses for the year ended December 31, 2015 (in thousands): Beginning Allowance Charge-offs Recoveries Provision Ending Allowance One-to-four family $ 1,442 $ (21 ) $ — $ 418 $ 1,839 Home equity 601 (35 ) 36 5 607 Commercial and multifamily 1,244 — — (323 ) 921 Construction and land 399 (40 ) — 23 382 Manufactured homes 193 (37 ) 8 137 301 Other consumer 167 (77 ) 15 83 188 Commercial business 108 — — 49 157 Unallocated 233 — — 8 241 $ 4,387 $ (210 ) $ 59 $ 400 $ 4,636 |
Credit Quality Indicators | The following table represents the internally assigned grades as of December 31, 2016 by type of loan (in thousands): One-to- four family Home equity Commercial and multifamily Construction and land Manufactured homes Other consumer Commercial business Total Grade: Pass $ 148,617 $ 26,547 $ 171,678 $ 67,539 $ 15,288 $ 27,817 $ 25,625 $ 483,111 Watch 998 536 8,105 3,376 78 49 326 13,468 Special Mention 139 — — 30 — — 169 Substandard 2,632 688 1,221 — 98 62 380 5,081 Doubtful — — — — — — — — Loss — — — — — — — — Total $ 152,386 $ 27,771 $ 181,004 $ 70,915 $ 15,494 $ 27,928 $ 26,331 $ 501,829 The following table represents the internally assigned grades as of December 31, 2015 by type of loan (in thousands): One-to- four family Home equity Commercial and multifamily Construction and land Manufactured homes Other consumer Commercial business Total Grade: Pass $ 136,879 $ 30,310 $ 169,072 $ 55,984 $ 13,621 $ 22,967 $ 18,449 $ 447,282 Watch 1,015 609 4,810 1,059 96 58 846 8,493 Special Mention 1,409 — 1,430 — 33 — — 2,872 Substandard 1,822 654 — — 48 5 — 2,529 Doubtful — — — — — — — — Loss — — — — — — — — Total $ 141,125 $ 31,573 $ 175,312 $ 57,043 $ 13,798 $ 23,030 $ 19,295 $ 461,176 |
Nonaccrual Loans | The following table presents the recorded investment in nonaccrual loans as of December 31, 2016 and 2015 by type of loan (in thousands): 2016 2015 One- to four- family $ 2,169 $ 1,157 Home equity 536 344 Commercial and Multifamily 218 — Manufactured homes 72 27 Commercial 149 — Total $ 3,144 $ 1,528 |
Aging of Recorded Investment in Past Due Loans | The following table represents the aging of the recorded investment in past due loans as of December 31, 2016 by type of loan (in thousands): 30-59 Days Past Due 60-89 Days Past Due Greater Than 90 Days Past Due Recorded Investment > 90 Days and Accruing Total Past Due Current Total Loans One-to-four family $ 2,476 $ 161 $ 1,787 $ — $ 4,424 $ 147,962 $ 152,386 Home equity 460 — 494 — 954 26,817 27,771 Commercial and multifamily — — — — — 181,004 181,004 Construction and land 440 — — — 440 70,475 70,915 Manufactured homes 321 28 62 — 411 15,083 15,494 Other consumer 26 1 — — 27 27,901 27,928 Commercial business 149 — — — 149 26,182 26,331 Total $ 3,872 $ 190 $ 2,343 $ — $ 6,405 $ 495,424 $ 501,829 The following table represents the aging of the recorded investment in past due loans as of December 31, 2015 by type of loan (in thousands): 30-59 Days Past Due 60-89 Days Past Due Greater Than 90 Days Past Due Recorded Investment > 90 Days and Accruing Total Past Due Current Total Loans One-to-four family $ 2,453 $ 265 $ 881 $ 117 $ 3,716 $ 137,409 $ 141,125 Home equity 352 60 296 — 708 30,865 31,573 Commercial and multifamily 203 — — — 203 175,109 175,312 Construction and land 65 — — — 65 56,978 57,043 Manufactured homes 103 27 — — 130 13,668 13,798 Other consumer 17 26 — — 43 22,987 23,030 Commercial business 154 8 — — 162 19,133 19,295 Total $ 3,347 $ 386 $ 1,177 $ 117 $ 5,027 $ 456,149 $ 461,176 |
Credit Risk Profile of Loan Portfolio Based on Payment Activity by Type of Loan | The following table represents the credit risk profile based on payment activity as of December 31, 2016 by type of loan (in thousands): One- to four- family Home equity Commercial and multifamily Construction and land Manufactured homes Other consumer Commercial business Total Performing $ 150,170 $ 27,218 $ 180,786 $ 70,915 $ 15,374 $ 27,928 $ 26,089 $ 498,480 Nonperforming 2,216 553 218 — 120 — 242 3,349 Total $ 152,386 $ 27,771 $ 181,004 $ 70,915 $ 15,494 $ 27,928 $ 26,331 $ 501,829 The following table represents the credit risk profile based on payment activity as of December 31, 2015 by type of loan (in thousands): One- to four- family Home equity Commercial and multifamily Construction and land Manufactured homes Other consumer Commercial business Total Performing $ 139,485 $ 31,145 $ 175,312 $ 57,043 $ 13,736 $ 23,030 $ 19,295 $ 459,046 Nonperforming 1,640 428 — 62 — — 2,130 Total $ 141,125 $ 31,573 $ 175,312 $ 57,043 $ 13,798 $ 23,030 $ 19,295 $ 461,176 |
Schedule of Impaired Loans, Individually Evaluated | The following table presents loans individually evaluated for impairment as of December 31, 2016 by type of loan (in thousands): Recorded Investment Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized With no related allowance recorded: One- to four- family $ 2,454 $ 2,715 $ — $ 1,476 $ 125 Home equity 446 446 — 304 18 Commercial and multifamily 1,221 1,221 — 1,326 70 Manufactured homes 91 106 — 46 9 Commercial business 143 143 — 71 10 Total 4,355 4,631 — 3,223 232 Recorded Investment Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized With an allowance recorded: One- to four- family 2,295 2,295 536 3,788 106 Home equity 386 466 121 564 19 Commercial and multifamily 361 361 24 449 17 Construction and land 83 83 35 87 4 Manufactured homes 221 221 59 291 16 Other consumer 62 62 65 34 4 Commercial business 473 473 23 294 26 Total 3,881 3,961 863 5,507 192 Totals: One- to four- family 4,749 5,010 536 5,264 231 Home equity 832 913 121 868 37 Commercial and multifamily 1,582 1,582 24 1,775 87 Construction and land 83 83 35 87 4 Manufactured homes 312 326 59 337 25 Other consumer 62 62 65 34 4 Commercial business 616 616 23 365 36 Total $ 8,236 $ 8,592 $ 863 $ 8,730 $ 424 The following table presents loans individually evaluated for impairment as of December 31, 2015 by type of loan (in thousands): Recorded Investment Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized With no related allowance record One- to four- family $ 499 $ 615 $ — $ 1,390 $ 23 Home equity 162 162 — 341 7 Commercial and multifamily 1,430 1,430 — 1,051 80 Construction and land — — — 40 — Manufactured homes — — — 52 — Other consumer — — — 28 — Commercial business — — — 61 — Total 2,091 2,207 — 2,963 110 With an allowance recorded: One- to four- family 5,280 5,396 647 3,686 246 Home equity 742 832 110 748 30 Commercial and multifamily 536 536 36 1,357 10 Construction and land 91 91 18 106 5 Manufactured homes 361 366 63 332 29 Other consumer 5 5 — 11 1 Commercial business 114 114 8 68 6 Total 7,129 7,340 882 6,308 327 Totals: One- to four- family 5,779 6,011 647 5,076 269 Home equity 904 994 110 1,089 37 Recorded Investment Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized Commercial and multifamily 1,966 1,966 36 2,408 90 Construction and land 91 91 18 146 5 Manufactured homes 361 366 63 384 29 Other consumer 5 5 — 39 1 Commercial business 114 114 8 129 6 Total $ 9,220 $ 9,547 $ 882 $ 9,271 $ 437 |
Related Party Loans | Director and officer loans are summarized as follows (in thousands): December 31, 2016 2015 Balance, beginning of period $ 4,093 $ 4,675 Advances 115 69 New / (retired) loans, net (897 ) 174 Repayments (131 ) (825 ) Balance, end of period $ 3,180 $ 4,093 |
Mortgage Servicing Rights (Tabl
Mortgage Servicing Rights (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Mortgage Servicing Rights [Abstract] | |
Mortgage Service Rights | A summary of the change in the balance of mortgage servicing assets at December 31, 2016 and 2015 is as follows (in thousands): Year Ended December 31, 2016 2015 Beginning balance, at fair value $ 3,249 $ 3,028 Servicing rights that result from transfers and purchase of financial assets 1,049 679 Changes in fair value: Due to changes in model inputs or assumptions (1) (49 ) 210 Other (2) (688 ) (668 ) Ending balance, at fair value $ 3,561 $ 3,249 (1) Represents changes in discount rates and prepayment speed assumptions, which are primarily affected by changes in interest rates. (2) Represents changes due to collection or realization of expected cash flows over time. |
Mortgage Service Rights Assumptions | The key economic assumptions used in determining the fair value of mortgage servicing rights were as follows: At December 31, 2016 2015 Prepayment speed (PSA) 152 % 178 % Weighted-average life (years) 7.2 6.7 Yield to maturity discount rate 13.0 % 10.0 % |
Premises and Equipment (Tables)
Premises and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Premises and Equipment [Abstract] | |
Premises and Equipment | Premises and equipment at December 31, 2016 and 2015 are summarized as follows (in thousands): At December 31, 2016 2015 Land $ 653 $ 653 Buildings and improvements 4,742 4,739 Furniture and equipment 3,756 2,752 Less: Accumulated depreciation and amortization (3,602 ) (2,809 ) Premises and equipment, net $ 5,549 $ 5,335 |
Minimum Future Rental Payments under Non-cancelable Operating Leases | Minimum rental payments under non-cancelable operating leases with initial or remaining terms of one year or more are as follows (in thousands): Year ending December 31, Amount 2017 $ 1,128 2018 933 2019 903 2020 858 2021 876 Thereafter 6,146 $ 10,844 |
Other Real Estate Owned and R35
Other Real Estate Owned and Repossessed Assets (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Other Real Estate Owned and Repossessed Assets [Abstract] | |
Activity Related to OREO and Repossessed Assets | The following table presents activity related to OREO and other repossessed assets for the periods shown (in thousands): Year ended December 31, 2016 2015 Beginning balance $ 769 $ 323 Additions to OREO and repossessed assets 634 1,383 Pay downs/Sales (252 ) (736 ) Write-ups/Gains (Write-downs/Losses) 21 (201 ) $ 1,172 $ 769 |
Deposits (Tables)
Deposits (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Deposits [Abstract] | |
Summary of Deposits Accounts with the Corresponding Weighted Average Cost of Funds | A summary of deposit accounts with the corresponding weighted average cost of funds at December 31, 2016 and 2015 are presented below (dollars in thousands): As of December 31, 2016 As of December 31, 2015 Deposit Balance Wtd Avg Rate Deposit Balance Wtd Avg Rate Noninterest-bearing demand $ 60,566 0.00 % $ 48,067 0.00 % Interest-bearing demand 150,327 0.34 127,392 0.42 Savings 44,879 0.21 38,833 0.18 Money market 49,042 0.17 54,046 0.16 Certificates 159,742 1.12 168,880 1.22 Escrow (1) 3,175 0.00 2,806 0.00 Total $ 467,731 0.53 % $ 440,024 0.63 % (1) Escrow balances shown in noninterest-bearing deposits on the consolidated balance sheets. |
Maturities of Time Deposits | Scheduled maturities of time deposits at December 31, 2016 are as follows (in thousands): Year Ending December 31, Amount 2017 $ 80,468 2018 45,260 2019 14,392 2020 6,044 Thereafter 13,578 $ 159,742 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Information about Level in Fair Value Hierarchy for Financial Instruments | The following tables present information about the level in the fair value hierarchy for the Company’s financial instruments as of December 31, 2016 and 2015 (in thousands): December 31, 2016 Fair Value Measurements Using: Carrying Value Estimated Fair Value Level 1 Level 2 Level 3 FINANCIAL ASSETS: Cash and cash equivalents $ 54,582 $ 54,582 $ 54,582 $ — $ — Available for sale securities 6,604 6,604 — 6,257 347 Loans held-for-sale 871 871 — 871 — Loans, net 495,179 494,289 — — 494,289 Accrued interest receivable 1,816 1,816 1,816 — — Mortgage servicing rights 3,561 3,561 — 3,561 FHLB Stock 2,840 2,840 — — 2,840 FINANCIAL LIABILITIES: Non-maturity deposits 307,989 307,989 — 307,989 — Time deposits 159,742 159,333 — 159,333 — Borrowings 54,792 54,805 — 54,805 — Accrued interest payable 73 73 — 73 — December 31, 2015 Fair Value Measurements Using: Carrying Value Estimated Fair Value Level 1 Level 2 Level 3 FINANCIAL ASSETS: Cash and cash equivalents $ 48,264 $ 48,264 $ 48,264 $ — $ — Available for sale securities 6,696 6,696 — 6,268 428 Loans held-for-sale 2,091 2,091 — 2,091 — Loans, net 454,833 454,854 — — 454,854 Accrued interest receivable 1,608 1,608 1,608 — — Mortgage servicing rights 3,249 3,249 — — 3,249 FHLB Stock 2,212 2,212 — — 2,212 FINANCIAL LIABILITIES: Non-maturity deposits 271,144 271,639 — 271,639 — Time deposits 168,880 168,091 — 168,091 — Borrowings 40,435 40,421 — 40,421 — Accrued interest payable 72 72 — 72 — |
Fair value of Assets Measured on Recurring Basis | The following tables present the balance of assets measured at fair value on a recurring basis as of December 31, 2016 and 2015 (in thousands): Fair Value at December 31, 2016 Description Total Level 1 Level 2 Level 3 Municipal bonds $ 3,353 $ — $ 3,353 $ — Agency mortgage-backed securities 2,904 — 2,904 — Non-agency mortgage-backed securities 347 — — 347 Mortgage servicing rights 3,561 — — 3,561 Fair Value at December 31, 2015 Description Total Level 1 Level 2 Level 3 Municipal bonds $ 2,096 $ — $ 2,096 $ — Agency mortgage-backed securities 4,172 — 4,172 — Non-agency mortgage-backed securities 428 — — 428 Mortgage servicing rights 3,249 — — 3,249 |
Reconciliation of Assets and Liabilities Measured at Fair Value Using Significant Unobservable Inputs (Level 3) | The following table provides a reconciliation of assets and liabilities (excluding mortgage servicing rights) measured at fair value using significant unobservable inputs (Level 3) on a recurring basis during the years ended December 31, 2016 and 2015 (in thousands): Year Ended December 31, 2016 2015 Beginning balance, at fair value $ 428 $ 2,345 Principal payments (87 ) (1,947 ) Change in unrealized loss 6 30 Ending balance, at fair value $ 347 $ 428 |
Fair value of Assets Measured on Nonrecurring Basis | The following table presents the balance of assets measured at fair value on a nonrecurring basis and the total losses resulting from these fair value adjustments (in thousands): Fair Value at December 31, 2016 Description Total Level 1 Level 2 Level 3 OREO and repossessed assets $ 1,172 $ — $ — $ 1,172 Impaired loans 8,236 — — 8,236 Fair Value at December 31, 2015 Description Total Level 1 Level 2 Level 3 OREO and repossessed assets $ 769 $ — $ — $ 769 Impaired loans 9,220 — — 9,220 |
Recurring [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Fair Value of Assets, Quantitative Information | The following table provides a description of the valuation technique, unobservable input, and qualitative information about the unobservable inputs for the Company’s assets and liabilities classified as Level 3 and measured at fair value on a recurring basis at December 31, 2016: Financial Instrument Valuation Technique Unobservable Input(s) Range (Weighted Average) Mortgage Servicing Rights Discounted cash flow Prepayment speed 104-396% (152%) Discount rate 13%-15% (13%) Non-agency Discounted cash flow Discount rate 7%-9% (8%) The following table provides a description of the valuation technique, unobservable input, and qualitative information about the unobservable inputs for the Company’s assets and liabilities classified as Level 3 and measured at fair value on a recurring basis at December 31, 2015: Financial Instrument Valuation Technique Unobservable Input(s) Range (Weighted Average) Mortgage Servicing Rights Discounted cash flow Prepayment speed 105-369% (178%) Discount rate 8%-12% (10%) Non-agency Discounted cash flow Discount rate 7%-9% (8%) |
Nonrecurring [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Fair Value of Assets, Quantitative Information | The following table provides a description of the valuation technique, observable input, and qualitative information about the unobservable inputs for the Company’s assets and liabilities classified as Level 3 and measured at fair value on a nonrecurring basis at December 31, 2016: Financial Instrument Valuation Technique(s) Unobservable Input(s) Range (Weighted Average) OREO Market approach Adjusted for difference 0-0% (0%) Impaired loans Market approach Adjusted for difference 0-100% (10.5%) The following table provides a description of the valuation technique, observable input, and qualitative information about the unobservable inputs for the Company’s assets and liabilities classified as Level 3 and measured at fair value on a nonrecurring basis at December 31, 2015: Financial Instrument Valuation Technique(s) Unobservable Input(s) Range (Weighted Average) OREO Market approach Adjusted for difference 0-57% (7%) Impaired loans Market approach Adjusted for difference 0-100% (7%) |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Earnings per Common Share | Earnings per share are summarized in the following table (all figures in thousands except earnings per share): Years Ended December 31, 2016 2015 Net income $ 5,378 $ 4,790 Weighted average number of shares outstanding, basic 2,487 2,492 Effect of potentially dilutive common shares (1) 80 88 Weighted average number of shares outstanding, diluted 2,567 2,580 Earnings per share, basic $ 2.16 $ 1.92 Earnings per share, diluted $ 2.09 $ 1.86 (1) Represents the effect of the assumed exercise of stock options and vesting of non-participating restricted shares, based on the treasury stock method. |
Employee Benefits (Tables)
Employee Benefits (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Employee Benefits [Abstract] | |
Summary of Stock Option Plan Award Activity | The following is a summary of the Company’s stock option plan award activity during the period ended December 31, 2016: Shares Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term In Years Aggregate Intrinsic Value Outstanding at the beginning of the year 184,407 $ 14.56 5.51 $ 2,478,430 Granted 10,993 22.31 Exercised (21,856 ) 10.66 Forfeited (3,487 ) 17.23 Expired — Outstanding at December 31, 2016 170,057 15.41 6.44 $ 2,141,018 Exercisable 94,382 13.44 5.54 $ 1,374,202 Expected to vest, assuming a 0% forfeiture rate over the vesting term 75,675 $ 17.87 6.61 $ 766,588 |
Weighted-average Assumptions Used in Determining Fair Value of Options Granted | The fair value of options granted in 2016 was determined using the following weighted-average assumptions as of the grant date. Annual dividend yield 1.03% Expected volatility 25.48 % Risk-free interest rate 1.64% Expected term 6.92 years Weighted-average grant date fair value per option granted $5.78 |
Summary of Nonvested Restricted Stock Awards | The following is a summary of the Company’s non-vested restricted stock awards for the year ended December 31, 2016: Non-vested Shares Shares Weighted- Average Grant- Date Fair Value Per Share Aggregate Intrinsic Value Per Share Non-vested at January 1, 2016 31,553 $ 16.32 Granted 11,606 22.31 Vested (15,962 ) 17.59 Forfeited (1,059 ) 17.36 Expired — Non-vested at December 31, 2016 26,138 $ 18.08 $ 28.00 Expected to vest assuming a 0% forfeiture rate over the vesting term 26,138 $ 18.08 $ 28.00 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Taxes [Abstract] | |
Provision for Income Taxes | The provision for income taxes at December 31, 2016 and 2015 was as follows (in thousands): At December 31, 2016 2015 Current $ 2,718 $ 2,648 Deferred (23 ) (359 ) Total tax expense $ 2,695 $ 2,289 |
Reconciliation of Provision for Income Taxes | A reconciliation of the provision for income taxes for the years ended December 31, 2016 and 2015 with amounts determined by applying the statutory U.S. federal income tax rate to income before income taxes is as follows (dollars in thousands): Years Ended December 31, 2016 2015 Provision at statutory rate $ 2,745 $ 2,407 Tax-exempt income (76 ) (63 ) Other 26 (55 ) 2,695 2,289 Federal Tax Rate 34.0 % 34.0 % Tax exempt rate (0.9 ) (0.9 ) Other 0.3 (0.8 ) Effective tax rate 33.4 % 32.3 % |
Components of Deferred Tax Assets | The following table reflects the temporary differences that gave rise to the components of the Company’s deferred tax assets at December 31, 2016 and 2015 (in thousands): At December 31, 2016 2015 Deferred tax assets Deferred compensation and supplemental retirement $ 444 $ 437 Other, net 182 164 Equity based compensation 117 90 Allowance for loan losses 912 641 Total deferred tax assets 1,655 1,332 Deferred tax liabilities Prepaid expenses (86 ) (79 ) FHLB stock dividends (141 ) (142 ) Unrealized gain on securities (42 ) (84 ) Depreciation (128 ) (112 ) Intangible assets (4 ) (3 ) Mortgage servicing rights (114 ) (55 ) Deferred loan costs (539 ) (322 ) Total deferred tax liabilities (1,054 ) (797 ) Net deferred tax asset $ 601 $ 535 |
Minimum Regulatory Capital Re41
Minimum Regulatory Capital Requirements (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Minimum Regulatory Capital Requirements [Abstract] | |
Actual Capital Amounts and Ratios | The Bank’s actual capital amounts (in thousands) and ratios as of December 31, 2016 and 2015 are presented in the following table: Actual Minimum Capital Requirements Minimum Required to Be Well-Capitalized Under Prompt Corrective Action Provisions Amount Ratio Amount Ratio Amount Ratio As of December 31, 2016 Tier 1 Capital to total adjusted assets (1) $ 57,406 9.99 % $ 22,992 ≥ 4.0 % $ 28,740 ≥ 5.0 % Common Equity Tier 1 risk-based capital ratio (2) $ 57,406 12.02 % $ 21,490 ≥ 4.5 % $ 31,041 ≥ 6.5 % Tier 1 Capital to risk-weighted assets (2) $ 57,406 12.02 % $ 28,653 ≥ 6.0 % $ 38,204 ≥ 8.0 % Total Capital to risk-weighted assets (2) $ 62,423 13.07 % $ 38,204 ≥ 8.0 % $ 47,755 ≥ 10.0 % As of December 31, 2015 Tier 1 Capital to total adjusted assets (3) $ 53,041 10.19 % $ 20,812 ≥ 4.0 % $ 26,015 ≥ 5.0 % Common Equity Tier 1 risk-based capital ratio (4) $ 53,041 11.70 % $ 20,401 ≥ 4.5 % $ 29,467 ≥ 6.5 % Tier 1 Capital to risk-weighted assets (4) $ 53,041 11.70 % $ 27,201 ≥ 6.0 % $ 36,268 ≥ 8.0 % Total Capital to risk-weighted assets (4) $ 57,677 12.74 % $ 36,268 ≥ 8.0 % $ 45,335 ≥ 10.0 % (1) Based on total adjusted assets of $574,792 at December 31, 2016. (2) Based on risk-weighted assets of $477,548 at December 31, 2016. (3) Based on total adjusted assets of $520,307 at December 31, 2015. (4) Based on risk-weighted assets of $453,345 at December 31, 2015. |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies [Abstract] | |
Financial Instruments whose Contract Amount Represents Credit Risk | Financial instruments whose contract amount represents credit risk were as follow (in thousands): At December 31, 2016 2015 Commitments to make loans $ 3,942 $ 6,037 Unfunded construction commitments 33,916 32,951 Unused lines of credit 24,753 19,925 Irrevocable letters of credit 185 185 Total loan commitments $ 62,796 $ 59,098 |
Parent Company Financial Info43
Parent Company Financial Information (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Parent Company Financial Information [Abstract] | |
Balance Sheets | Balance sheets December 31, 2016 2015 Assets Cash and cash equivalents $ 1,916 $ 451 Investment in Sound Community Bank 57,699 53,483 Other assets 660 586 Total assets $ 60,275 $ 54,520 Liabilities and Stockholders’ Equity Other liabilities — — Total liabilities — — Stockholders’ equity 60,275 54,520 Total liabilities and stockholders’ equity $ 60,275 $ 54,520 |
Statements of Income | Statements of Income Year Ended December 31, 2016 2015 Interest income $ — $ — Dividend from subsidiary 1,750 1,200 Other expenses (220 ) (244 ) Income before income tax benefit and equity in undistributed net Income of subsidiary 1,530 956 Income tax benefit 75 83 Equity in undistributed earnings of subsidiary 3,773 3,751 Net income $ 5,378 $ 4,790 |
Statements of Cash Flows | Statements of Cash Flows Year Ended December 31, 2016 2015 Cash flows from operating activities: Net income $ 5,378 $ 4,790 Adjustments to reconcile net income to net cash provided by operating activities Other, net (75 ) 312 Change in undistributed equity of subsidiary (3,773 ) (3,751 ) Net cash used by operating activities 1,530 1,351 Cash flows from investing activities: Net proceeds from ESOP 515 457 Net cash provided by investing activities 515 457 Cash flows from financing activities: Dividends paid (745 ) (574 ) Excess tax benefit of stock compensation — — Common stock exercised 165 65 Common stock repurchased — (1,261 ) Net cash used by financing activities (580 ) (1,770 ) Net increase in cash 1,465 38 Cash and cash equivalents at beginning of year 451 413 Cash and cash equivalents at end of year $ 1,916 $ 451 |
Organization and Significant 44
Organization and Significant Accounting Policies (Details) | 12 Months Ended | |
Dec. 31, 2016USD ($)Segmentshares | Dec. 31, 2015USD ($) | |
Loans [Abstract] | ||
Minimum past due period after which accrual of interest is discontinued | 3 months | |
Loans charge off period, maximum | 120 days | |
Period of consecutive monthly loan payments for loan to return to accrual status | 12 months | |
Federal Home Loan Bank Stock [Abstract] | ||
Minimum required investment in Federal Home Loan Bank Stock | $ 2,800,000 | $ 2,200,000 |
Segment reporting [Abstract] | ||
Number of operating segments | Segment | 1 | |
Advertising costs [Abstract] | ||
Advertising costs | $ 201,000 | 150,000 |
Employee stock ownership plan [Abstract] | ||
Unallocated shares (in shares) | shares | 66,800 | |
Shares released (in shares) | shares | 21,443 | |
Furniture and Equipment [Member] | Minimum [Member] | ||
Premises and equipment [Abstract] | ||
Useful life | 1 year | |
Furniture and Equipment [Member] | Maximum [Member] | ||
Premises and equipment [Abstract] | ||
Useful life | 10 years | |
Building [Member] | Maximum [Member] | ||
Premises and equipment [Abstract] | ||
Useful life | 39 years | |
Core Deposits [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Intangible asset | $ 352,000 | 485,000 |
Amortization period | 9 years 6 months | |
Remaining weighted average life | 2 years 2 months 12 days | |
Impairment loss on intangible assets | $ 0 | $ 0 |
Restricted Cash (Details)
Restricted Cash (Details) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Restricted Cash [Abstract] | ||
Reserve balances with Federal Reserve Bank | $ 7.7 | $ 4.6 |
Investments (Details)
Investments (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | $ 6,482 | $ 6,449 |
Gross unrealized gains | 176 | 286 |
Gross unrealized losses | (54) | (39) |
Estimated fair value | 6,604 | 6,696 |
Municipal Bonds [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 3,262 | 1,912 |
Gross unrealized gains | 127 | 184 |
Gross unrealized losses | (36) | 0 |
Estimated fair value | 3,353 | 2,096 |
Agency Mortgage-backed Securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 2,858 | 4,088 |
Gross unrealized gains | 49 | 102 |
Gross unrealized losses | (3) | (18) |
Estimated fair value | 2,904 | 4,172 |
Non-agency Mortgage-backed Securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 362 | 449 |
Gross unrealized gains | 0 | 0 |
Gross unrealized losses | (15) | (21) |
Estimated fair value | $ 347 | $ 428 |
Investments, Mortgage-backed Se
Investments, Mortgage-backed Securities by Contractual Maturity (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Available-for-sale Securities by Contractual Maturity, Amortized Cost [Abstract] | ||
Due in less than one year | $ 0 | |
Due in one to five years | 1,349,000 | |
Due after five to ten years | 414,000 | |
Due after ten years | 4,719,000 | |
Total | 6,482,000 | |
Available-for-sale Securities by Contractual Maturity, Fair Value [Abstract] | ||
Due in less than one year | 0 | |
Due in one to five years | 1,313,000 | |
Due after five to ten years | 432,000 | |
Due after ten years | 4,859,000 | |
Total | 6,604,000 | |
Pledged securities | 0 | |
Sales of available for sale securities | $ 0 | $ 0 |
Investments, Securities in Cont
Investments, Securities in Continuous Unrealized Loss Position (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Continuous Unrealized Loss Position, Fair Value [Abstract] | ||
Less than 12 months | $ 1,313 | $ 0 |
12 months or longer | 1,472 | 1,798 |
Total | 2,785 | 1,798 |
Continuous Unrealized Loss Position, Unrealized Loss [Abstract] | ||
Less than 12 months | (36) | 0 |
12 months or longer | (18) | (39) |
Total | (54) | (39) |
Municipal Bonds [Member] | ||
Continuous Unrealized Loss Position, Fair Value [Abstract] | ||
Less than 12 months | 1,313 | |
12 months or longer | 0 | |
Total | 1,313 | |
Continuous Unrealized Loss Position, Unrealized Loss [Abstract] | ||
Less than 12 months | (36) | |
12 months or longer | 0 | |
Total | (36) | |
Agency Mortgage-backed Securities [Member] | ||
Continuous Unrealized Loss Position, Fair Value [Abstract] | ||
Less than 12 months | 0 | 0 |
12 months or longer | 1,125 | 1,370 |
Total | 1,125 | 1,370 |
Continuous Unrealized Loss Position, Unrealized Loss [Abstract] | ||
Less than 12 months | 0 | 0 |
12 months or longer | (3) | (18) |
Total | (3) | (18) |
Non-agency Mortgage-backed Securities [Member] | ||
Continuous Unrealized Loss Position, Fair Value [Abstract] | ||
Less than 12 months | 0 | 0 |
12 months or longer | 347 | 428 |
Total | 347 | 428 |
Continuous Unrealized Loss Position, Unrealized Loss [Abstract] | ||
Less than 12 months | 0 | 0 |
12 months or longer | (15) | (21) |
Total | $ (15) | $ (21) |
Investments, Other Than Tempora
Investments, Other Than Temporary Impairment (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016USD ($)Security | Dec. 31, 2015USD ($)Security | |
Other than temporary impairment, credit losses recognized in earnings [Roll Forward] | ||
Estimated credit losses, beginning balance | $ | $ 0 | $ 450 |
Additions for credit losses not previously recognized | $ | 0 | 0 |
Reduction for increases in cash flows | $ | 0 | 0 |
Removal of credit losses due to securities sold | $ | 0 | (450) |
Estimated credit losses, ending balance | $ | $ 0 | $ 0 |
Agency Mortgage-backed Securities [Member] | ||
Other than temporary impairment, credit losses recognized in earnings [Roll Forward] | ||
Number of portfolio securities | Security | 9 | 12 |
Number of securities in unrealized loss position | Security | 1 | 1 |
Non-agency Mortgage-backed Securities [Member] | ||
Other than temporary impairment, credit losses recognized in earnings [Roll Forward] | ||
Number of portfolio securities | Security | 1 | 1 |
Municipal Bonds [Member] | ||
Other than temporary impairment, credit losses recognized in earnings [Roll Forward] | ||
Number of portfolio securities | Security | 8 | 5 |
Number of securities in unrealized loss position | Security | 3 |
Loans, Composition of Loan Port
Loans, Composition of Loan Portfolio (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Composition of Loan Portfolio [Abstract] | ||||
Total loans | $ 501,829 | $ 461,176 | ||
Deferred fees | (1,828) | (1,707) | ||
Total loans, gross | 500,001 | 459,469 | ||
Allowance for loan losses | (4,822) | (4,636) | $ (4,387) | |
Total loans, net | 495,179 | 454,833 | ||
One-to Four- Family [Member] | ||||
Composition of Loan Portfolio [Abstract] | ||||
Total loans | 152,386 | 141,125 | ||
Allowance for loan losses | (1,542) | (1,839) | (1,442) | |
Home Equity [Member] | ||||
Composition of Loan Portfolio [Abstract] | ||||
Total loans | 27,771 | 31,573 | ||
Allowance for loan losses | (378) | (607) | (601) | |
Commercial and Multifamily [Member] | ||||
Composition of Loan Portfolio [Abstract] | ||||
Total loans | 181,004 | 175,312 | ||
Allowance for loan losses | (1,144) | (921) | (1,244) | |
Construction and Land [Member] | ||||
Composition of Loan Portfolio [Abstract] | ||||
Total loans | 70,915 | 57,043 | ||
Allowance for loan losses | (459) | (382) | (399) | |
Manufactured Homes [Member] | ||||
Composition of Loan Portfolio [Abstract] | ||||
Total loans | 15,494 | 13,798 | ||
Allowance for loan losses | (168) | (301) | (193) | |
Other Consumer [Member] | ||||
Composition of Loan Portfolio [Abstract] | ||||
Total loans | 27,928 | 23,030 | ||
Allowance for loan losses | (244) | (188) | (167) | |
Real Estate Loans [Member] | ||||
Composition of Loan Portfolio [Abstract] | ||||
Total loans | 432,076 | 405,053 | ||
Real Estate Loans [Member] | One-to Four- Family [Member] | ||||
Composition of Loan Portfolio [Abstract] | ||||
Total loans | 152,386 | 141,125 | ||
Real Estate Loans [Member] | Home Equity [Member] | ||||
Composition of Loan Portfolio [Abstract] | ||||
Total loans | 27,771 | 31,573 | ||
Real Estate Loans [Member] | Commercial and Multifamily [Member] | ||||
Composition of Loan Portfolio [Abstract] | ||||
Total loans | 181,004 | 175,312 | ||
Real Estate Loans [Member] | Construction and Land [Member] | ||||
Composition of Loan Portfolio [Abstract] | ||||
Total loans | 70,915 | 57,043 | ||
Consumer Loans [Member] | ||||
Composition of Loan Portfolio [Abstract] | ||||
Total loans | 43,422 | 36,828 | ||
Consumer Loans [Member] | Manufactured Homes [Member] | ||||
Composition of Loan Portfolio [Abstract] | ||||
Total loans | 15,494 | 13,798 | ||
Consumer Loans [Member] | Other Consumer [Member] | ||||
Composition of Loan Portfolio [Abstract] | ||||
Total loans | [1] | 27,928 | 23,030 | |
Consumer Loans [Member] | Other Consumer [Member] | Floating Home Loans [Member] | ||||
Composition of Loan Portfolio [Abstract] | ||||
Total loans | 24,000 | 18,200 | ||
Commercial Business Loans [Member] | ||||
Composition of Loan Portfolio [Abstract] | ||||
Total loans | 26,331 | 19,295 | ||
Allowance for loan losses | $ (175) | $ (157) | $ (108) | |
[1] | Included in other consumer loans are floating home loans totaling $24.0 million and $18.2 million as of December 31, 2016 and 2015, respectively. |
Loans, Allowance for Loan Losse
Loans, Allowance for Loan Losses and Recorded Investment in Loans by Portfolio Segment and Based on Impairment Method (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Allowance for loan losses [Abstract] | |||
Individually evaluated for impairment | $ 863 | $ 882 | |
Collectively evaluated for impairment | 3,959 | 3,754 | |
Ending balance | 4,822 | 4,636 | $ 4,387 |
Loans receivable [Abstract] | |||
Individually evaluated for impairment | 8,236 | 9,220 | |
Collectively evaluated for impairment | 493,593 | 451,956 | |
Total loans | 501,829 | 461,176 | |
One-to Four- Family [Member] | |||
Allowance for loan losses [Abstract] | |||
Individually evaluated for impairment | 536 | 647 | |
Collectively evaluated for impairment | 1,006 | 1,192 | |
Ending balance | 1,542 | 1,839 | 1,442 |
Loans receivable [Abstract] | |||
Individually evaluated for impairment | 4,749 | 5,779 | |
Collectively evaluated for impairment | 147,637 | 135,346 | |
Total loans | 152,386 | 141,125 | |
Home Equity [Member] | |||
Allowance for loan losses [Abstract] | |||
Individually evaluated for impairment | 121 | 110 | |
Collectively evaluated for impairment | 257 | 497 | |
Ending balance | 378 | 607 | 601 |
Loans receivable [Abstract] | |||
Individually evaluated for impairment | 832 | 904 | |
Collectively evaluated for impairment | 26,939 | 30,669 | |
Total loans | 27,771 | 31,573 | |
Commercial and Multifamily [Member] | |||
Allowance for loan losses [Abstract] | |||
Individually evaluated for impairment | 24 | 36 | |
Collectively evaluated for impairment | 1,120 | 885 | |
Ending balance | 1,144 | 921 | 1,244 |
Loans receivable [Abstract] | |||
Individually evaluated for impairment | 1,582 | 1,966 | |
Collectively evaluated for impairment | 179,422 | 173,346 | |
Total loans | 181,004 | 175,312 | |
Construction and Land [Member] | |||
Allowance for loan losses [Abstract] | |||
Individually evaluated for impairment | 35 | 18 | |
Collectively evaluated for impairment | 424 | 364 | |
Ending balance | 459 | 382 | 399 |
Loans receivable [Abstract] | |||
Individually evaluated for impairment | 83 | 91 | |
Collectively evaluated for impairment | 70,832 | 56,952 | |
Total loans | 70,915 | 57,043 | |
Manufactured Homes [Member] | |||
Allowance for loan losses [Abstract] | |||
Individually evaluated for impairment | 59 | 63 | |
Collectively evaluated for impairment | 109 | 238 | |
Ending balance | 168 | 301 | 193 |
Loans receivable [Abstract] | |||
Individually evaluated for impairment | 312 | 361 | |
Collectively evaluated for impairment | 15,182 | 13,437 | |
Total loans | 15,494 | 13,798 | |
Other Consumer [Member] | |||
Allowance for loan losses [Abstract] | |||
Individually evaluated for impairment | 65 | 0 | |
Collectively evaluated for impairment | 179 | 188 | |
Ending balance | 244 | 188 | 167 |
Loans receivable [Abstract] | |||
Individually evaluated for impairment | 62 | 5 | |
Collectively evaluated for impairment | 27,866 | 23,025 | |
Total loans | 27,928 | 23,030 | |
Commercial Business [Member] | |||
Allowance for loan losses [Abstract] | |||
Individually evaluated for impairment | 23 | 8 | |
Collectively evaluated for impairment | 152 | 149 | |
Ending balance | 175 | 157 | 108 |
Loans receivable [Abstract] | |||
Individually evaluated for impairment | 616 | 114 | |
Collectively evaluated for impairment | 25,715 | 19,181 | |
Total loans | 26,331 | 19,295 | |
Unallocated [Member] | |||
Allowance for loan losses [Abstract] | |||
Individually evaluated for impairment | 0 | 0 | |
Collectively evaluated for impairment | 712 | 241 | |
Ending balance | 712 | 241 | $ 233 |
Loans receivable [Abstract] | |||
Individually evaluated for impairment | 0 | 0 | |
Collectively evaluated for impairment | 0 | 0 | |
Total loans | $ 0 | $ 0 |
Loans, Activity in Allowance fo
Loans, Activity in Allowance for Loan Losses (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Summary of activity in allowance for loan losses [Roll Forward] | ||
Beginning allowance | $ 4,636 | $ 4,387 |
Charge-offs | (472) | (210) |
Recoveries | 204 | 59 |
Provision | 454 | 400 |
Ending allowance | 4,822 | 4,636 |
One-to Four- Family [Member] | ||
Summary of activity in allowance for loan losses [Roll Forward] | ||
Beginning allowance | 1,839 | 1,442 |
Charge-offs | (72) | (21) |
Recoveries | 47 | 0 |
Provision | (272) | 418 |
Ending allowance | 1,542 | 1,839 |
Home Equity [Member] | ||
Summary of activity in allowance for loan losses [Roll Forward] | ||
Beginning allowance | 607 | 601 |
Charge-offs | (15) | (35) |
Recoveries | 78 | 36 |
Provision | (292) | 5 |
Ending allowance | 378 | 607 |
Commercial and Multifamily [Member] | ||
Summary of activity in allowance for loan losses [Roll Forward] | ||
Beginning allowance | 921 | 1,244 |
Charge-offs | (314) | 0 |
Recoveries | 0 | 0 |
Provision | 537 | (323) |
Ending allowance | 1,144 | 921 |
Construction and Land [Member] | ||
Summary of activity in allowance for loan losses [Roll Forward] | ||
Beginning allowance | 382 | 399 |
Charge-offs | 0 | (40) |
Recoveries | 18 | 0 |
Provision | 59 | 23 |
Ending allowance | 459 | 382 |
Manufactured Homes [Member] | ||
Summary of activity in allowance for loan losses [Roll Forward] | ||
Beginning allowance | 301 | 193 |
Charge-offs | 0 | (37) |
Recoveries | 8 | 8 |
Provision | (141) | 137 |
Ending allowance | 168 | 301 |
Other Consumer [Member] | ||
Summary of activity in allowance for loan losses [Roll Forward] | ||
Beginning allowance | 188 | 167 |
Charge-offs | (42) | (77) |
Recoveries | 53 | 15 |
Provision | 45 | 83 |
Ending allowance | 244 | 188 |
Commercial Business [Member] | ||
Summary of activity in allowance for loan losses [Roll Forward] | ||
Beginning allowance | 157 | 108 |
Charge-offs | (29) | 0 |
Recoveries | 0 | 0 |
Provision | 47 | 49 |
Ending allowance | 175 | 157 |
Unallocated [Member] | ||
Summary of activity in allowance for loan losses [Roll Forward] | ||
Beginning allowance | 241 | 233 |
Charge-offs | 0 | 0 |
Recoveries | 0 | 0 |
Provision | 471 | 8 |
Ending allowance | $ 712 | $ 241 |
Loans, Credit Quality (Details)
Loans, Credit Quality (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | $ 501,829 | $ 461,176 |
Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 483,111 | 447,282 |
Watch [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 13,468 | 8,493 |
Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 169 | 2,872 |
Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 5,081 | 2,529 |
Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Loss [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
One-to Four- Family [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 152,386 | 141,125 |
One-to Four- Family [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 148,617 | 136,879 |
One-to Four- Family [Member] | Watch [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 998 | 1,015 |
One-to Four- Family [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 139 | 1,409 |
One-to Four- Family [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 2,632 | 1,822 |
One-to Four- Family [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
One-to Four- Family [Member] | Loss [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Home Equity [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 27,771 | 31,573 |
Home Equity [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 26,547 | 30,310 |
Home Equity [Member] | Watch [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 536 | 609 |
Home Equity [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Home Equity [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 688 | 654 |
Home Equity [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Home Equity [Member] | Loss [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Commercial and Multifamily [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 181,004 | 175,312 |
Commercial and Multifamily [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 171,678 | 169,072 |
Commercial and Multifamily [Member] | Watch [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 8,105 | 4,810 |
Commercial and Multifamily [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 1,430 |
Commercial and Multifamily [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 1,221 | 0 |
Commercial and Multifamily [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Commercial and Multifamily [Member] | Loss [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Construction and Land [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 70,915 | 57,043 |
Construction and Land [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 67,539 | 55,984 |
Construction and Land [Member] | Watch [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 3,376 | 1,059 |
Construction and Land [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Construction and Land [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Construction and Land [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Construction and Land [Member] | Loss [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Manufactured Homes [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 15,494 | 13,798 |
Manufactured Homes [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 15,288 | 13,621 |
Manufactured Homes [Member] | Watch [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 78 | 96 |
Manufactured Homes [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 30 | 33 |
Manufactured Homes [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 98 | 48 |
Manufactured Homes [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Manufactured Homes [Member] | Loss [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Other Consumer [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 27,928 | 23,030 |
Other Consumer [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 27,817 | 22,967 |
Other Consumer [Member] | Watch [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 49 | 58 |
Other Consumer [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Other Consumer [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 62 | 5 |
Other Consumer [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Other Consumer [Member] | Loss [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Commercial Business [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 26,331 | 19,295 |
Commercial Business [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 25,625 | 18,449 |
Commercial Business [Member] | Watch [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 326 | 846 |
Commercial Business [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Commercial Business [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 380 | 0 |
Commercial Business [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Commercial Business [Member] | Loss [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | $ 0 | $ 0 |
Loans, Nonaccrual and Past Due
Loans, Nonaccrual and Past Due Loans (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Nonaccrual loans | $ 3,144 | $ 1,528 |
Recorded Investment > 90 days and accruing | 0 | 117 |
Total past due | 6,405 | 5,027 |
Current | 495,424 | 456,149 |
Total loans | 501,829 | 461,176 |
30-59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 3,872 | 3,347 |
60-89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 190 | 386 |
Greater Than 90 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 2,343 | 1,177 |
One-to Four- Family [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Nonaccrual loans | 2,169 | 1,157 |
Recorded Investment > 90 days and accruing | 0 | 117 |
Total past due | 4,424 | 3,716 |
Current | 147,962 | 137,409 |
Total loans | 152,386 | 141,125 |
One-to Four- Family [Member] | 30-59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 2,476 | 2,453 |
One-to Four- Family [Member] | 60-89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 161 | 265 |
One-to Four- Family [Member] | Greater Than 90 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 1,787 | 881 |
Home Equity [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Nonaccrual loans | 536 | 344 |
Recorded Investment > 90 days and accruing | 0 | 0 |
Total past due | 954 | 708 |
Current | 26,817 | 30,865 |
Total loans | 27,771 | 31,573 |
Home Equity [Member] | 30-59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 460 | 352 |
Home Equity [Member] | 60-89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 0 | 60 |
Home Equity [Member] | Greater Than 90 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 494 | 296 |
Commercial and Multifamily [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Nonaccrual loans | 218 | 0 |
Recorded Investment > 90 days and accruing | 0 | 0 |
Total past due | 0 | 203 |
Current | 181,004 | 175,109 |
Total loans | 181,004 | 175,312 |
Commercial and Multifamily [Member] | 30-59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 0 | 203 |
Commercial and Multifamily [Member] | 60-89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 0 | 0 |
Commercial and Multifamily [Member] | Greater Than 90 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 0 | 0 |
Construction and Land [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Recorded Investment > 90 days and accruing | 0 | 0 |
Total past due | 440 | 65 |
Current | 70,475 | 56,978 |
Total loans | 70,915 | 57,043 |
Construction and Land [Member] | 30-59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 440 | 65 |
Construction and Land [Member] | 60-89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 0 | 0 |
Construction and Land [Member] | Greater Than 90 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 0 | 0 |
Manufactured Homes [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Nonaccrual loans | 72 | 27 |
Recorded Investment > 90 days and accruing | 0 | 0 |
Total past due | 411 | 130 |
Current | 15,083 | 13,668 |
Total loans | 15,494 | 13,798 |
Manufactured Homes [Member] | 30-59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 321 | 103 |
Manufactured Homes [Member] | 60-89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 28 | 27 |
Manufactured Homes [Member] | Greater Than 90 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 62 | 0 |
Other Consumer [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Recorded Investment > 90 days and accruing | 0 | 0 |
Total past due | 27 | 43 |
Current | 27,901 | 22,987 |
Total loans | 27,928 | 23,030 |
Other Consumer [Member] | 30-59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 26 | 17 |
Other Consumer [Member] | 60-89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 1 | 26 |
Other Consumer [Member] | Greater Than 90 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 0 | 0 |
Commercial Business [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Nonaccrual loans | 149 | 0 |
Recorded Investment > 90 days and accruing | 0 | 0 |
Total past due | 149 | 162 |
Current | 26,182 | 19,133 |
Total loans | 26,331 | 19,295 |
Commercial Business [Member] | 30-59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 149 | 154 |
Commercial Business [Member] | 60-89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 0 | 8 |
Commercial Business [Member] | Greater Than 90 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | $ 0 | $ 0 |
Loans, Credit Risk Profile Base
Loans, Credit Risk Profile Based on Payment Activity (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | $ 501,829 | $ 461,176 |
Minimum [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Period past due for loans still accruing interest to be considered nonperforming | 90 days | |
Period of sufficient payment history for TDR to be considered performing | 6 months | |
Period past due for TDRs loans to be considered nonperforming | 31 days | |
Performing [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | $ 498,480 | 459,046 |
Nonperforming [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | 3,349 | 2,130 |
One-to Four- Family [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | 152,386 | 141,125 |
One-to Four- Family [Member] | Performing [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | 150,170 | 139,485 |
One-to Four- Family [Member] | Nonperforming [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | 2,216 | 1,640 |
Home Equity [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | 27,771 | 31,573 |
Home Equity [Member] | Performing [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | 27,218 | 31,145 |
Home Equity [Member] | Nonperforming [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | 553 | 428 |
Commercial and Multifamily [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | 181,004 | 175,312 |
Commercial and Multifamily [Member] | Performing [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | 180,786 | 175,312 |
Commercial and Multifamily [Member] | Nonperforming [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | 218 | 0 |
Construction and Land [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | 70,915 | 57,043 |
Construction and Land [Member] | Performing [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | 70,915 | 57,043 |
Construction and Land [Member] | Nonperforming [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | 0 | 0 |
Manufactured Homes [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | 15,494 | 13,798 |
Manufactured Homes [Member] | Performing [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | 15,374 | 13,736 |
Manufactured Homes [Member] | Nonperforming [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | 120 | 62 |
Other Consumer [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | 27,928 | 23,030 |
Other Consumer [Member] | Performing [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | 27,928 | 23,030 |
Other Consumer [Member] | Nonperforming [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | 0 | 0 |
Commercial Business [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | 26,331 | 19,295 |
Commercial Business [Member] | Performing [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | 26,089 | 19,295 |
Commercial Business [Member] | Nonperforming [Member] | ||
Credit Risk Profile by Type of Loan [Abstract] | ||
Total loans | $ 242 | $ 0 |
Loans, Loans Individually Evalu
Loans, Loans Individually Evaluated for Impairment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
With no related allowance recorded [Abstract] | ||
Recorded investment | $ 4,355 | $ 2,091 |
Unpaid principal balance | 4,631 | 2,207 |
Average recorded investment | 3,223 | 2,963 |
Interest income recognized | 232 | 110 |
With an allowance recorded [Abstract] | ||
Recorded investment | 3,881 | 7,129 |
Unpaid principal balance | 3,961 | 7,340 |
Related allowance | 863 | 882 |
Average recorded investment | 5,507 | 6,308 |
Interest income recognized | 192 | 327 |
Total [Abstract] | ||
Recorded investments | 8,236 | 9,220 |
Unpaid principal balance | 8,592 | 9,547 |
Related allowance | 863 | 882 |
Average recorded investment | 8,730 | 9,271 |
Interest income recognized | 424 | 437 |
Impaired loans, interest income forgone | 54 | 104 |
Commitments to lend additional funds to borrowers whose loans were classified as nonaccrual, TDR or impaired | 0 | 0 |
One-to Four- Family [Member] | ||
With no related allowance recorded [Abstract] | ||
Recorded investment | 2,454 | 499 |
Unpaid principal balance | 2,715 | 615 |
Average recorded investment | 1,476 | 1,390 |
Interest income recognized | 125 | 23 |
With an allowance recorded [Abstract] | ||
Recorded investment | 2,295 | 5,280 |
Unpaid principal balance | 2,295 | 5,396 |
Related allowance | 536 | 647 |
Average recorded investment | 3,788 | 3,686 |
Interest income recognized | 106 | 246 |
Total [Abstract] | ||
Recorded investments | 4,749 | 5,779 |
Unpaid principal balance | 5,010 | 6,011 |
Related allowance | 536 | 647 |
Average recorded investment | 5,264 | 5,076 |
Interest income recognized | 231 | 269 |
Home Equity [Member] | ||
With no related allowance recorded [Abstract] | ||
Recorded investment | 446 | 162 |
Unpaid principal balance | 446 | 162 |
Average recorded investment | 304 | 341 |
Interest income recognized | 18 | 7 |
With an allowance recorded [Abstract] | ||
Recorded investment | 386 | 742 |
Unpaid principal balance | 466 | 832 |
Related allowance | 121 | 110 |
Average recorded investment | 564 | 748 |
Interest income recognized | 19 | 30 |
Total [Abstract] | ||
Recorded investments | 832 | 904 |
Unpaid principal balance | 913 | 994 |
Related allowance | 121 | 110 |
Average recorded investment | 868 | 1,089 |
Interest income recognized | 37 | 37 |
Commercial and Multifamily [Member] | ||
With no related allowance recorded [Abstract] | ||
Recorded investment | 1,221 | 1,430 |
Unpaid principal balance | 1,221 | 1,430 |
Average recorded investment | 1,326 | 1,051 |
Interest income recognized | 70 | 80 |
With an allowance recorded [Abstract] | ||
Recorded investment | 361 | 536 |
Unpaid principal balance | 361 | 536 |
Related allowance | 24 | 36 |
Average recorded investment | 449 | 1,357 |
Interest income recognized | 17 | 10 |
Total [Abstract] | ||
Recorded investments | 1,582 | 1,966 |
Unpaid principal balance | 1,582 | 1,966 |
Related allowance | 24 | 36 |
Average recorded investment | 1,775 | 2,408 |
Interest income recognized | 87 | 90 |
Construction and Land [Member] | ||
With no related allowance recorded [Abstract] | ||
Recorded investment | 0 | |
Unpaid principal balance | 0 | |
Average recorded investment | 40 | |
Interest income recognized | 0 | |
With an allowance recorded [Abstract] | ||
Recorded investment | 83 | 91 |
Unpaid principal balance | 83 | 91 |
Related allowance | 35 | 18 |
Average recorded investment | 87 | 106 |
Interest income recognized | 4 | 5 |
Total [Abstract] | ||
Recorded investments | 83 | 91 |
Unpaid principal balance | 83 | 91 |
Related allowance | 35 | 18 |
Average recorded investment | 87 | 146 |
Interest income recognized | 4 | 5 |
Manufactured Homes [Member] | ||
With no related allowance recorded [Abstract] | ||
Recorded investment | 91 | 0 |
Unpaid principal balance | 106 | 0 |
Average recorded investment | 46 | 52 |
Interest income recognized | 9 | 0 |
With an allowance recorded [Abstract] | ||
Recorded investment | 221 | 361 |
Unpaid principal balance | 221 | 366 |
Related allowance | 59 | 63 |
Average recorded investment | 291 | 332 |
Interest income recognized | 16 | 29 |
Total [Abstract] | ||
Recorded investments | 312 | 361 |
Unpaid principal balance | 326 | 366 |
Related allowance | 59 | 63 |
Average recorded investment | 337 | 384 |
Interest income recognized | 25 | 29 |
Other Consumer [Member] | ||
With no related allowance recorded [Abstract] | ||
Recorded investment | 0 | |
Unpaid principal balance | 0 | |
Average recorded investment | 28 | |
Interest income recognized | 0 | |
With an allowance recorded [Abstract] | ||
Recorded investment | 62 | 5 |
Unpaid principal balance | 62 | 5 |
Related allowance | 65 | 0 |
Average recorded investment | 34 | 11 |
Interest income recognized | 4 | 1 |
Total [Abstract] | ||
Recorded investments | 62 | 5 |
Unpaid principal balance | 62 | 5 |
Related allowance | 65 | 0 |
Average recorded investment | 34 | 39 |
Interest income recognized | 4 | 1 |
Commercial Business [Member] | ||
With no related allowance recorded [Abstract] | ||
Recorded investment | 143 | 0 |
Unpaid principal balance | 143 | 0 |
Average recorded investment | 71 | 61 |
Interest income recognized | 10 | 0 |
With an allowance recorded [Abstract] | ||
Recorded investment | 473 | 114 |
Unpaid principal balance | 473 | 114 |
Related allowance | 23 | 8 |
Average recorded investment | 294 | 68 |
Interest income recognized | 26 | 6 |
Total [Abstract] | ||
Recorded investments | 616 | 114 |
Unpaid principal balance | 616 | 114 |
Related allowance | 23 | 8 |
Average recorded investment | 365 | 129 |
Interest income recognized | $ 36 | $ 6 |
Loans, Troubled Debt Restructur
Loans, Troubled Debt Restructurings (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016USD ($)Loan | Dec. 31, 2015USD ($)Loan | |
Financing Receivable, Modifications [Line Items] | ||
Loans classified as TDRs | $ 3,400 | $ 6,000 |
Number of TDR modifications with subsequent default | Loan | 0 | 0 |
Commitments to extend additional credit to borrowers whose loan terms have been modified in TDRs | $ 0 | $ 0 |
Unsecured Loan [Member] | Combination Modifications [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of contracts | Loan | 1 | |
Total modifications | $ 40 | |
Commercial and Multifamily [Member] | Combination Modifications [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of contracts | Loan | 1 | |
Total modifications | $ 368 |
Loans, Loans to Related Parties
Loans, Loans to Related Parties (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Loans [Abstract] | ||
Annual adjustable rate over rolling cost of funds | 1.00% | |
Discount on market loan rate for consumer loans to employees and officers | 1.00% | |
Director and Officer Loans [Roll Forward] | ||
Balance, beginning of period | $ 4,093 | $ 4,675 |
Advances | 115 | 69 |
New / (retired) loans, net | (897) | 174 |
Repayments | (131) | (825) |
Balance, end of period | 3,180 | 4,093 |
Secured real estate loans that have loan-to-value ratios above supervisory guidelines | $ 5,800 | $ 7,800 |
Mortgage Servicing Rights (Deta
Mortgage Servicing Rights (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | ||
Summary of the Change in the Balance of Mortgage Service Rights Assets [Roll Forward] | |||
Beginning balance, at fair value | $ 3,249 | $ 3,028 | |
Servicing rights that result from transfers and purchase of financial assets | 1,049 | 679 | |
Changes in fair value [Abstract] | |||
Due to changes in model inputs or assumptions | [1] | (49) | 210 |
Other | [2] | (668) | (668) |
Ending balance, at fair value | $ 3,561 | $ 3,249 | |
Mortgage Servicing Right, Key Economic Assumptions [Abstract] | |||
Prepayment speed (PSA) | 152.00% | 178.00% | |
Weighted-average life | 7 years 2 months 12 days | 6 years 8 months 12 days | |
Yield to maturity discount rate | 13.00% | 10.00% | |
Contractually specified servicing, late and ancillary fees earned and recorded in mortgage servicing income | $ 956 | $ 840 | |
Federal National Mortgage Association (FNMA) [Member] | |||
Servicing Assets at Fair Value [Line Items] | |||
Loans serviced for others | 410,100 | 360,400 | |
Other Financial Institutions [Member] | |||
Servicing Assets at Fair Value [Line Items] | |||
Loans serviced for others | $ 13,800 | $ 9,400 | |
[1] | Represents changes in discount rates and prepayment speed assumptions, which are primarily affected by changes in interest rates. | ||
[2] | Represents changes due to collection or realization of expected cash flows over time. |
Premises and Equipment (Details
Premises and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Property, Plant and Equipment [Line Items] | ||
Less: Accumulated depreciation and amortization | $ (3,602) | $ (2,809) |
Premises and equipment, net | 5,549 | 5,335 |
Depreciation and amortization expense | 793 | 620 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | 653 | 653 |
Building and Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | 4,742 | 4,739 |
Furniture and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | $ 3,756 | $ 2,752 |
Premises and Equipment, Operati
Premises and Equipment, Operating Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Minimum Rental Payments under Non-Cancelable Operating Leases [Abstract] | ||
2,017 | $ 1,128 | |
2,018 | 933 | |
2,019 | 903 | |
2,020 | 858 | |
2,021 | 876 | |
Thereafter | 6,146 | |
Total | 10,844 | |
Rental expense | $ 1,000 | $ 877 |
Other Real Estate Owned and R62
Other Real Estate Owned and Repossessed Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Other Real Estate [Roll Forward] | ||
Beginning balance | $ 769 | $ 323 |
Additions to OREO and repossessed assets | 634 | 1,383 |
Pay downs/Sales | (252) | (736) |
Write-ups/Gains (Write-downs/Losses) | 21 | (201) |
Ending balance | $ 1,172 | $ 769 |
Deposits (Details)
Deposits (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | ||
Summary of Deposit Accounts with the Corresponding Weighted Average Cost of Funds [Abstract] | |||
Noninterest-bearing demand | $ 60,566,000 | $ 48,067,000 | |
Interest-bearing demand | 150,327,000 | 127,392,000 | |
Savings | 44,879,000 | 38,833,000 | |
Money market | 49,042,000 | 54,046,000 | |
Certificates | 159,742,000 | 168,880,000 | |
Escrow | [1] | 3,175,000 | 2,806,000 |
Total deposits | $ 467,731,000 | $ 440,024,000 | |
Weighted Average Interest Rate [Abstract] | |||
Noninterest-bearing demand | 0.00% | 0.00% | |
Interest-bearing demand | 0.34% | 0.42% | |
Savings | 0.21% | 0.18% | |
Money market | 0.17% | 0.16% | |
Certificates | 1.12% | 1.22% | |
Escrow | [1] | 0.00% | 0.00% |
Total deposits | 0.53% | 0.63% | |
Stated Maturities of Time Deposits [Abstract] | |||
2,017 | $ 80,468,000 | ||
2,018 | 45,260,000 | ||
2,019 | 14,392,000 | ||
2,020 | 6,044,000 | ||
Thereafter | 13,578,000 | ||
Total time deposits | $ 159,742,000 | ||
Maximum time to maturity of certificate accounts | 5 years | ||
Time deposits in denominations of $250,000 or more | $ 56,700,000 | $ 63,300,000 | |
Maximum federal insurability of time deposits | 250,000 | ||
Brokered deposits | 3,600,000 | 4,700,000 | |
Related party deposits | $ 1,300,000 | $ 3,000,000 | |
[1] | Escrow balances shown in noninterest-bearing deposits on the consolidated balance sheets |
Borrowings (Details)
Borrowings (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Short-term Debt [Line Items] | ||
Contractual principal repayments due within one year | $ 54,792,000 | |
Weighted average interest rate on borrowings due within one year | 0.82% | |
Federal Home Loan Bank of Des Moines [Member] | ||
Short-term Debt [Line Items] | ||
Amount available to borrow under loan agreement | $ 197,900,000 | $ 174,000,000 |
Outstanding borrowings | 54,792,000 | 40,435,000 |
Maximum amount outstanding from FHLB under term advances | 59,800,000 | 45,000,000 |
Average balance outstanding | $ 36,600,000 | $ 24,600,000 |
Weighted average interest rate on borrowings | 0.58% | 0.43% |
One-to Four- Family [Member] | Federal Home Loan Bank of Des Moines [Member] | ||
Short-term Debt [Line Items] | ||
Loans used as collateral for credit facility | $ 107,200,000 | |
Home Equity [Member] | Federal Home Loan Bank of Des Moines [Member] | ||
Short-term Debt [Line Items] | ||
Loans used as collateral for credit facility | 15,900,000 | |
Commercial and Multifamily [Member] | Federal Home Loan Bank of Des Moines [Member] | ||
Short-term Debt [Line Items] | ||
Loans used as collateral for credit facility | 94,400,000 | |
Line of Credit [Member] | Pacific Coast Banker's Bank [Member] | ||
Short-term Debt [Line Items] | ||
Amount available to borrow under loan agreement | 2,000,000 | |
Outstanding borrowings | $ 0 | $ 0 |
Term period | 1 year | |
Maturity date | Jun. 30, 2017 | |
Line of Credit [Member] | Zions Bank [Member] | ||
Short-term Debt [Line Items] | ||
Outstanding borrowings | $ 0 | 0 |
Line of credit, maximum borrowing capacity | 9,000,000 | |
Line of credit facility, minimum cash balance required | 250,000 | |
Line of Credit [Member] | The Independent Bank [Member] | ||
Short-term Debt [Line Items] | ||
Amount available to borrow under loan agreement | 10,000,000 | |
Outstanding borrowings | 0 | 0 |
Federal Reserve Bank Advances [Member] | ||
Short-term Debt [Line Items] | ||
Outstanding borrowings | 0 | 0 |
Unused borrowing capacity | 42,000,000 | 25,900,000 |
Letters of Credit [Member] | Federal Home Loan Bank of Des Moines [Member] | ||
Short-term Debt [Line Items] | ||
Letters of credit to secure public deposits | 21,000,000 | 47,500,000 |
Net remaining amount available | $ 122,200,000 | $ 86,100,000 |
Fair Value Measurements, Fair V
Fair Value Measurements, Fair Value Hierarchy (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
FINANCIAL ASSETS [Abstract] | |||
Available for sale securities | $ 6,604 | $ 6,696 | |
Mortgage servicing rights | 3,561 | 3,249 | $ 3,028 |
Level 1 [Member] | |||
FINANCIAL ASSETS [Abstract] | |||
Cash and cash equivalents | 54,582 | 48,264 | |
Available for sale securities | 0 | 0 | |
Loans held-for-sale | 0 | 0 | |
Loans, net | 0 | 0 | |
Accrued interest receivable | 1,816 | 1,608 | |
Mortgage servicing rights | 0 | 0 | |
FHLB Stock | 0 | 0 | |
FINANCIAL LIABILITIES [Abstract] | |||
Non-maturity deposits | 0 | 0 | |
Time deposits | 0 | 0 | |
Borrowings | 0 | 0 | |
Accrued interest payable | 0 | 0 | |
Level 2 [Member] | |||
FINANCIAL ASSETS [Abstract] | |||
Cash and cash equivalents | 0 | 0 | |
Available for sale securities | 6,257 | 6,268 | |
Loans held-for-sale | 871 | 2,091 | |
Loans, net | 0 | 0 | |
Accrued interest receivable | 0 | 0 | |
Mortgage servicing rights | 0 | 0 | |
FHLB Stock | 0 | 0 | |
FINANCIAL LIABILITIES [Abstract] | |||
Non-maturity deposits | 307,989 | 271,639 | |
Time deposits | 159,333 | 168,091 | |
Borrowings | 54,805 | 40,421 | |
Accrued interest payable | 73 | 72 | |
Level 3 [Member] | |||
FINANCIAL ASSETS [Abstract] | |||
Cash and cash equivalents | 0 | 0 | |
Available for sale securities | 347 | 428 | |
Loans held-for-sale | 0 | 0 | |
Loans, net | 494,289 | 454,854 | |
Accrued interest receivable | 0 | 0 | |
Mortgage servicing rights | 3,561 | 3,249 | |
FHLB Stock | 2,840 | 2,212 | |
FINANCIAL LIABILITIES [Abstract] | |||
Non-maturity deposits | 0 | 0 | |
Time deposits | 0 | 0 | |
Borrowings | 0 | 0 | |
Accrued interest payable | 0 | 0 | |
Carrying Value [Member] | |||
FINANCIAL ASSETS [Abstract] | |||
Cash and cash equivalents | 54,582 | 48,264 | |
Available for sale securities | 6,604 | 6,696 | |
Loans held-for-sale | 871 | 2,091 | |
Loans, net | 495,179 | 454,833 | |
Accrued interest receivable | 1,816 | 1,608 | |
Mortgage servicing rights | 3,561 | 3,249 | |
FHLB Stock | 2,840 | 2,212 | |
FINANCIAL LIABILITIES [Abstract] | |||
Non-maturity deposits | 307,989 | 271,144 | |
Time deposits | 159,742 | 168,880 | |
Borrowings | 54,792 | 40,435 | |
Accrued interest payable | 73 | 72 | |
Estimated Fair Value [Member] | |||
FINANCIAL ASSETS [Abstract] | |||
Cash and cash equivalents | 54,582 | 48,264 | |
Available for sale securities | 6,604 | 6,696 | |
Loans held-for-sale | 871 | 2,091 | |
Loans, net | 494,289 | 454,854 | |
Accrued interest receivable | 1,816 | 1,608 | |
Mortgage servicing rights | 3,561 | 3,249 | |
FHLB Stock | 2,840 | 2,212 | |
FINANCIAL LIABILITIES [Abstract] | |||
Non-maturity deposits | 307,989 | 271,639 | |
Time deposits | 159,333 | 168,091 | |
Borrowings | 54,805 | 40,421 | |
Accrued interest payable | $ 73 | $ 72 |
Fair Value Measurements, Recurr
Fair Value Measurements, Recurring and Nonrecurring (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Asset transfers from Level 1 to Level 2 | $ 0 | |
Asset transfers from Level 2 into Level 3 | 0 | |
Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Municipal bonds | 3,353 | $ 2,096 |
Agency mortgage-backed securities | 2,904 | 4,172 |
Non-agency mortgage-backed securities | 347 | 428 |
Mortgage servicing rights | 3,561 | 3,249 |
Liabilities carried at fair value | 0 | 0 |
Recurring [Member] | Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Municipal bonds | 0 | 0 |
Agency mortgage-backed securities | 0 | 0 |
Non-agency mortgage-backed securities | 0 | 0 |
Mortgage servicing rights | 0 | 0 |
Recurring [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Municipal bonds | 3,353 | 2,096 |
Agency mortgage-backed securities | 2,904 | 4,172 |
Non-agency mortgage-backed securities | 0 | 0 |
Mortgage servicing rights | 0 | 0 |
Recurring [Member] | Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Municipal bonds | 0 | 0 |
Agency mortgage-backed securities | 0 | 0 |
Non-agency mortgage-backed securities | 347 | 428 |
Mortgage servicing rights | 3,561 | 3,249 |
Nonrecurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
OREO and repossessed assets | 1,172 | 769 |
Impaired loans | 8,236 | 9,220 |
Liabilities carried at fair value | 0 | 0 |
Nonrecurring [Member] | Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
OREO and repossessed assets | 0 | 0 |
Impaired loans | 0 | 0 |
Nonrecurring [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
OREO and repossessed assets | 0 | 0 |
Impaired loans | 0 | 0 |
Nonrecurring [Member] | Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
OREO and repossessed assets | 1,172 | 769 |
Impaired loans | $ 8,236 | $ 9,220 |
Fair Value Measurements, Quanti
Fair Value Measurements, Quantitative Information (Details) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Prepayment speed assumption | 152.00% | 178.00% |
Recurring [Member] | Level 3 [Member] | Mortgage Servicing Rights [Member] | Discounted Cash Flow [Member] | Minimum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Prepayment speed assumption | 104.00% | 105.00% |
Discount rate | 13.00% | 8.00% |
Recurring [Member] | Level 3 [Member] | Mortgage Servicing Rights [Member] | Discounted Cash Flow [Member] | Maximum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Prepayment speed assumption | 396.00% | 369.00% |
Discount rate | 15.00% | 12.00% |
Recurring [Member] | Level 3 [Member] | Mortgage Servicing Rights [Member] | Discounted Cash Flow [Member] | Weighted Average [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Prepayment speed assumption | 152.00% | 178.00% |
Discount rate | 13.00% | 10.00% |
Recurring [Member] | Level 3 [Member] | Non-agency Mortgage-backed Securities [Member] | Discounted Cash Flow [Member] | Minimum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Discount rate | 7.00% | 7.00% |
Recurring [Member] | Level 3 [Member] | Non-agency Mortgage-backed Securities [Member] | Discounted Cash Flow [Member] | Maximum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Discount rate | 9.00% | 9.00% |
Recurring [Member] | Level 3 [Member] | Non-agency Mortgage-backed Securities [Member] | Discounted Cash Flow [Member] | Weighted Average [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Discount rate | 8.00% | 8.00% |
Nonrecurring [Member] | Level 3 [Member] | OREO [Member] | Market Approach [Member] | Minimum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Adjusted for difference between comparable sales | 0.00% | 0.00% |
Nonrecurring [Member] | Level 3 [Member] | OREO [Member] | Market Approach [Member] | Maximum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Adjusted for difference between comparable sales | 0.00% | 57.00% |
Nonrecurring [Member] | Level 3 [Member] | OREO [Member] | Market Approach [Member] | Weighted Average [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Adjusted for difference between comparable sales | 0.00% | 7.00% |
Nonrecurring [Member] | Level 3 [Member] | Impaired Loans [Member] | Market Approach [Member] | Minimum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Adjusted for difference between comparable sales | 0.00% | 0.00% |
Nonrecurring [Member] | Level 3 [Member] | Impaired Loans [Member] | Market Approach [Member] | Maximum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Adjusted for difference between comparable sales | 100.00% | 100.00% |
Nonrecurring [Member] | Level 3 [Member] | Impaired Loans [Member] | Market Approach [Member] | Weighted Average [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Adjusted for difference between comparable sales | 10.50% | 7.00% |
Fair Value Measurements, Level
Fair Value Measurements, Level 3 Unobservable Inputs (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Reconciliation of assets and liabilities measured at fair value using significant unobservable inputs (Level 3) [Roll Forward] | ||
Beginning balance, at fair value | $ 428 | $ 2,345 |
Principal payments | (87) | (1,947) |
Change in unrealized loss | 6 | 30 |
Ending balance, at fair value | $ 347 | $ 428 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | ||
Earnings Per Share [Abstract] | |||
Net income | $ 5,378 | $ 4,790 | |
Weighted average number of shares outstanding, basic (in shares) | 2,486,936 | 2,491,683 | |
Effect of potentially dilutive common shares (in shares) | [1] | 80,000 | 88,000 |
Weighted average number of shares outstanding, diluted (in shares) | 2,566,980 | 2,579,575 | |
Earnings per share, basic (in dollars per share) | $ 2.16 | $ 1.92 | |
Earnings per share, diluted (in dollars per share) | $ 2.09 | $ 1.86 | |
Anti-dilutive securities not included in computation of diluted earnings per common share (in shares) | 0 | 0 | |
[1] | Represents the effect of the assumed exercise of stock options and vesting of non-participating restricted shares, based on the treasury stock method. |
Employee Benefits, 401(K) Plan
Employee Benefits, 401(K) Plan and Deferred Compensation Plan (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Defined Contribution Pension and Other Postretirement Plans Disclosure [Abstract] | ||
Employer contribution amount | $ 139,000 | $ 135,000 |
Deferred Compensation [Abstract] | ||
Age of employee when benefit becomes payable | 65 years | |
Deferred compensation liability | $ 102,000 | 102,000 |
Employer discretionary contribution | $ 0 | $ 0 |
Employee Benefits, Supplemental
Employee Benefits, Supplemental Executive Retirement Plans (Details) - Ms. Stewart [Member] | 12 Months Ended |
Dec. 31, 2016USD ($)Plan | |
SERP [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Number of supplemental executive retirement plans | Plan | 2 |
SERP 1 [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Annual benefit payment related to supplemental executive retirement benefit plans | $ 53,320 |
SERP 2 [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Annual benefit payment related to supplemental executive retirement benefit plans | $ 78,030 |
Age for commencing additional retirement benefits | 70 years |
Period to pay single lump sum amount | 90 days |
Lump sum amount eligible for beneficiary | $ 1,000,000 |
Employee Benefits, Confidential
Employee Benefits, Confidentiality, Non-Competition, and Non-Solicitation Agreement (Details) - Non-compete Agreement [Member] - Ms. Stewart [Member] | 12 Months Ended |
Dec. 31, 2016USD ($)Installment | |
Finite-Lived Intangible Assets [Line Items] | |
Expiration period | 36 months |
Supplemental retirement benefit payable to employee on bi-monthly basis during Restricted Period | $ 3,541.67 |
Percentage of retirement benefits payable to employee upon termination for good reason | 150.00% |
Period of average short term bonus pay | 3 years |
Lump sum amount of benefit payable to employee | $ 719,000 |
Number of monthly installments on termination benefits | Installment | 12 |
Period of termination following change in control to be entitled to lump sum benefit | 24 months |
Employee Benefits, Stock Option
Employee Benefits, Stock Options and Restricted Stock (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016USD ($)Planshares | Dec. 31, 2015USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of existing Equity Incentive Plans | Plan | 2 | |
Share-based compensation | $ | $ 525 | $ 418 |
Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Cumulative number of shares issued (in shares) | 234,391 | |
Restricted Stock Awards [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Cumulative number of shares issued (in shares) | 106,637 | |
2008 Plan [Member] | Stock Options and Stock Appreciation Rights [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares authorized (in shares) | 126,287 | |
2008 Plan [Member] | Restricted Stock and Restricted Stock Units [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares authorized (in shares) | 50,514 | |
2013 Plan [Member] | Stock Options and Stock Appreciation Rights [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares authorized (in shares) | 141,750 | |
2013 Plan [Member] | Restricted Stock and Restricted Stock Units [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares authorized (in shares) | 56,700 |
Employee Benefits, Stock Opti74
Employee Benefits, Stock Option Awards (Details) - Stock Options [Member] - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Term of awards | 10 years | |
Options, Outstanding [Roll Forward] | ||
Outstanding, beginning of period (in shares) | 184,407 | |
Granted (in shares) | 10,993 | |
Exercised (in shares) | (21,856) | |
Forfeited (in shares) | (3,487) | |
Expired (in shares) | 0 | |
Outstanding, end of period (in shares) | 170,057 | 184,407 |
Exercisable (in shares) | 94,382 | |
Expected to vest, assuming a 0% forfeiture rate over the vesting term (in shares) | 75,675 | |
Options, Outstanding, Weighted Average Exercise Price [Roll Forward] | ||
Outstanding, beginning of period (in dollars per share) | $ 14.56 | |
Granted (in dollars per share) | 22.31 | |
Exercised (in dollars per share) | 10.66 | |
Forfeited (in dollars per share) | 17.23 | |
Outstanding, end of period (in dollars per share) | 15.41 | $ 14.56 |
Exercisable (in dollars per share) | 13.44 | |
Expected to vest, assuming a 0% forfeiture rate over the vesting term (in dollars per share) | $ 17.87 | |
Options, Additional Disclosures [Abstract] | ||
Outstanding, weighted-average remaining contractual term | 6 years 5 months 8 days | 5 years 6 months 4 days |
Exercisable, weighted-average remaining contractual term | 5 years 6 months 14 days | |
Expected to vest, assuming a 0% forfeiture rate over the vesting term, weighted-average remaining contractual term | 6 years 7 months 10 days | |
Outstanding, aggregate intrinsic value | $ 2,141,018 | $ 2,478,430 |
Exercisable, aggregate intrinsic value | 1,374,202 | |
Expected to vest, assuming a 0% forfeiture rate over the vesting term, aggregate intrinsic value | $ 766,588 | |
Forfeiture rate | 0.00% | |
Unrecognized compensation cost | $ 309,000 | |
Remaining weighted-average vesting period | 2 years 1 month 17 days | |
Share-based compensation arrangement, fair value assumptions and methodology [Abstract] | ||
Annual dividend yield | 1.03% | |
Expected volatility | 25.48% | |
Risk-free interest rate | 1.64% | |
Expected term | 6 years 11 months 1 day | |
Weighted-average grant date fair value per option granted (in dollars per share) | $ 5.78 | |
2008 Plan [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Annual vesting percentage | 20.00% | |
Vesting commencement period from grant date | 1 year | |
2013 Plan [Member] | Minimum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting period | 2 years | |
2013 Plan [Member] | Maximum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting period | 4 years |
Employee Benefits, Restricted S
Employee Benefits, Restricted Stock Awards (Details) - Restricted Stock Awards [Member] $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2016USD ($)Installment$ / sharesshares | Dec. 31, 2015USD ($)$ / sharesshares | |
Non-vested Restricted Stock Awards, Shares [Roll Forward] | ||
Non-vested, beginning of period (in shares) | shares | 31,553 | |
Granted (in shares) | shares | 11,606 | |
Vested (in shares) | shares | (15,962) | |
Forfeited (in shares) | shares | (1,059) | |
Expired (in shares) | shares | 0 | |
Non-vested, end of period (in shares) | shares | 26,138 | 31,553 |
Expected to vest assuming a 0% forfeiture rate over the vesting term (in shares) | shares | 26,138 | |
Nonvested Restricted Stock Awards, Weighted Average Grant Date Fair Value [Roll Forward] | ||
Non-vested, beginning of period (in dollars per share) | $ 16.32 | |
Granted (in dollars per share) | 22.31 | |
Vested (in dollars per share) | 17.59 | |
Forfeited (in dollars per share) | 17.36 | |
Non-vested, end of period (in dollars per share) | 18.08 | $ 16.32 |
Expected to vest assuming a 0% forfeiture rate over the vesting term, weighted average grant date fair value (in dollars per share) | 18.08 | |
Nonvested Restricted Stock Awards, Additional Disclosures [Abstract] | ||
Aggregate intrinsic value per share (in dollars per share) | 28 | |
Expected to vest assuming a 0% forfeiture rate over the vesting term, aggregate intrinsic value per share (in dollars per share) | $ 28 | |
Forfeiture rate | 0.00% | |
Unrecognized compensation cost | $ | $ 310 | |
Remaining weighted-average vesting period | 1 year 11 days | |
Total fair value of shares vested | $ | $ 272 | $ 211 |
2008 Plan [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Annual vesting percentage | 20.00% | |
Vesting commencement period from grant date | 1 year | |
2013 Plan [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting commencement period from grant date | 1 year | |
Immediate vesting percentage | 33.33% | |
Number of annual installments | Installment | 2 |
Employee Benefits, Employee Sto
Employee Benefits, Employee Stock Ownership Plan (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Aug. 31, 2012 | Jan. 31, 2008 | |
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items] | ||||
Shares released (in shares) | 21,443 | |||
Unallocated shares (in shares) | 66,800 | |||
Employee Stock Ownership Plan [Member] | ||||
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items] | ||||
Repayment period | 10 years | |||
Shares released (in shares) | 21,443 | |||
Unallocated shares (in shares) | 66,800 | |||
Number of restricted shares held by the trust (in shares) | 183,469 | |||
Fair value of shares held by ESOP trust | $ 5,100 | |||
ESOP compensation expense | 491 | $ 448 | ||
Employee Stock Ownership Plan [Member] | ESOP Borrowing 2008 [Member] | ||||
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items] | ||||
Amount borrowed by ESOP to purchase common stock | $ 1,200 | |||
ESOP loan interest rate | 4.00% | |||
ESOP remaining loan balance from shares purchased | 136 | |||
Employee Stock Ownership Plan [Member] | ESOP Borrowing 2012 [Member] | ||||
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items] | ||||
Amount borrowed by ESOP to purchase common stock | $ 1,100 | |||
ESOP loan interest rate | 2.25% | |||
ESOP remaining loan balance from shares purchased | $ 590 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Provision for income taxes [Abstract] | ||
Current | $ 2,718 | $ 2,648 |
Deferred | (23) | (359) |
Total tax expense | 2,695 | 2,289 |
Reconciliation of provision for income taxes from U.S. federal income tax rate [Abstract] | ||
Provision at statutory rate | 2,745 | 2,407 |
Tax-exempt income | (76) | (63) |
Other | 26 | (55) |
Total tax expense | $ 2,695 | $ 2,289 |
Federal Tax Rate | 34.00% | 34.00% |
Tax exempt rate | (0.90%) | (0.90%) |
Other | 0.30% | (0.80%) |
Effective tax rate | 33.40% | 32.30% |
Deferred tax assets [Abstract] | ||
Deferred compensation and supplemental retirement | $ 444 | $ 437 |
Other, net | 182 | 164 |
Equity based compensation | 117 | 90 |
Allowance for loan losses | 912 | 641 |
Total deferred tax assets | 1,655 | 1,332 |
Deferred tax liabilities [Abstract] | ||
Prepaid expenses | (86) | (79) |
FHLB stock dividends | (141) | (142) |
Unrealized gain on securities | (42) | (84) |
Depreciation | (128) | (112) |
Intangible assets | (4) | (3) |
Mortgage servicing rights | (114) | (55) |
Deferred loan costs | (539) | (322) |
Total deferred tax liabilities | (1,054) | (797) |
Net deferred tax asset | 601 | 535 |
Unrecognized tax benefits | 0 | 0 |
Unrecognized tax benefits, income tax penalties and interest expense | $ 0 | $ 0 |
Minimum Regulatory Capital Re78
Minimum Regulatory Capital Requirements (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | ||
Actual, Amount [Abstract] | ||||
Tier I capital to total adjusted assets | $ 57,406 | [1] | $ 53,041 | [2] |
Common Equity Tier 1 risk-based capital ratio | 57,406 | [3] | 53,041 | [4] |
Tier I capital to risk-weighted assets | 57,406 | [3] | 53,041 | [4] |
Total capital to risk-weighted assets | $ 62,423 | [3] | $ 57,677 | [4] |
Actual, Ratio [Abstract] | ||||
Tier I capital to total adjusted assets | 9.99% | [1] | 10.19% | [2] |
Common Equity Tier 1 risk-based capital ratio | 12.02% | [3] | 11.70% | [4] |
Tier I capital to risk-weighted asset | 12.02% | [3] | 11.70% | [4] |
Total capital to risk-weighted assets | 13.07% | [3] | 12.74% | [4] |
Minimum Capital Requirements, Amount [Abstract] | ||||
Tier I capital to total adjusted assets | $ 22,992 | [1] | $ 20,812 | [2] |
Common Equity Tier I risk-based capital ratio | 21,490 | [3] | 20,401 | [4] |
Tier I capital to risk-weighted assets | 28,653 | [3] | 27,201 | [4] |
Total capital to risk-weighted assets | $ 38,204 | [3] | $ 36,268 | [4] |
Minimum Capital Requirements, Ratio [Abstract] | ||||
Tier I capital to total adjusted assets | 4.00% | [1] | 4.00% | [2] |
Common Equity Tier I risk-based capital ratio | 4.50% | [3] | 4.50% | [4] |
Tier I capital to risk-weighted assets | 6.00% | [3] | 6.00% | [4] |
Total capital to risk-weighted assets | 8.00% | [3] | 8.00% | [4] |
Minimum Required to Be Well-Capitalized Under Prompt Corrective Action Provisions, Amount [Abstract] | ||||
Tier I capital to total adjusted assets | $ 28,740 | [1] | $ 26,015 | [2] |
Common Equity Tier I risk-based capital ratio | 31,041 | [3] | 29,467 | [4] |
Tier I capital to risk-weighted assets | 38,204 | [3] | 36,268 | [4] |
Total capital to risk weighted assets | $ 47,755 | [3] | $ 45,335 | [4] |
Minimum Required to Be Well-Capitalized Under Prompt Corrective Action Provisions, Ratio [Abstract] | ||||
Tier I capital to total adjusted assets | 5.00% | [1] | 5.00% | [2] |
Common Equity Tier I risk-based capital ratio | 6.50% | [3] | 6.50% | [4] |
Tier I capital to risk-weighted assets | 8.00% | [3] | 8.00% | [4] |
Total capital to risk-weighted assets | 10.00% | [3] | 10.00% | [4] |
Total adjusted assets | $ 574,792 | $ 520,307 | ||
Total risk-weighted assets | $ 477,548 | $ 453,345 | ||
Sound Financial Bancorp [Member] | ||||
Actual, Ratio [Abstract] | ||||
Tier I capital to total adjusted assets | 10.42% | |||
Common Equity Tier 1 risk-based capital ratio | 12.54% | |||
Tier I capital to risk-weighted asset | 12.54% | |||
Total capital to risk-weighted assets | 13.59% | |||
[1] | Based on total adjusted assets of $574,792 at December 31, 2016. | |||
[2] | Based on total adjusted assets of $520,307 at December 31, 2015. | |||
[3] | Based on risk-weighted assets of $477,548 at December 31, 2016. | |||
[4] | Based on risk-weighted assets of $453,345 at December 31, 2015. |
Concentrations of Credit Risk (
Concentrations of Credit Risk (Details) | 12 Months Ended |
Dec. 31, 2016 | |
Loans to Borrowers [Member] | Customer Concentration Risk [Member] | Maximum [Member] | |
Concentration Risk [Line Items] | |
Loans to any borrower as a percent of unimpaired capital and surplus | 15.00% |
Commitments and Contingencies80
Commitments and Contingencies (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016USD ($)Loan | Dec. 31, 2015USD ($)Loan | |
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Financial instruments whose contract amount represents a credit risk | $ 62,796 | $ 59,098 |
Fixed rate loan commitments | $ 5,800 | $ 6,000 |
Weighted average interest rate on fixed rate loan commitments | 4.02% | 4.00% |
Notional amount on letters of credit issued by FHLB of Seattle | $ 21,000 | |
Loan Repurchase Guarantee [Member] | ||
Guarantor Obligations [Line Items] | ||
Maximum amounts of guarantees on loans sold without recourse | $ 410,100 | $ 360,400 |
Number of loans repurchased | Loan | 0 | 0 |
Commitments to Make Loans [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Financial instruments whose contract amount represents a credit risk | $ 3,942 | $ 6,037 |
Unfunded Construction Commitments [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Financial instruments whose contract amount represents a credit risk | 33,916 | 32,951 |
Unused Lines of Credit [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Financial instruments whose contract amount represents a credit risk | 24,753 | 19,925 |
Irrevocable Letters of Credit [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Financial instruments whose contract amount represents a credit risk | $ 185 | $ 185 |
Parent Company Financial Info81
Parent Company Financial Information, Balance Sheets (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Assets [Abstract] | |||
Cash and cash equivalents | $ 54,582 | $ 48,264 | $ 29,289 |
Other assets | 4,127 | 3,957 | |
Total assets | 588,383 | 540,760 | |
Liabilities and Stockholders' Equity [Abstract] | |||
Other liabilities | 4,874 | 5,140 | |
Total liabilities | 528,108 | 486,240 | |
Stockholders' equity | 60,275 | 54,520 | 50,644 |
Total liabilities and stockholders' equity | 588,383 | 540,760 | |
Sound Financial Bancorp (Parent Only) [Member] | |||
Assets [Abstract] | |||
Cash and cash equivalents | 1,916 | 451 | $ 413 |
Investment in Sound Community Bank | 57,699 | 53,483 | |
Other assets | 660 | 586 | |
Total assets | 60,275 | 54,520 | |
Liabilities and Stockholders' Equity [Abstract] | |||
Other liabilities | 0 | 0 | |
Total liabilities | 0 | 0 | |
Stockholders' equity | 60,275 | 54,520 | |
Total liabilities and stockholders' equity | $ 60,275 | $ 54,520 |
Parent Company Financial Info82
Parent Company Financial Information, Statements of Income (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Condensed Income Statements Captions [Line Items] | ||
Interest income | $ 25,050 | $ 22,453 |
Income before income tax benefit and equity in undistributed net Income of subsidiary | 8,073 | 7,079 |
Income tax benefit | (2,695) | (2,289) |
Net income | 5,378 | 4,790 |
Sound Financial Bancorp (Parent Only) [Member] | ||
Condensed Income Statements Captions [Line Items] | ||
Interest income | 0 | 0 |
Dividend from subsidiary | 1,750 | 1,200 |
Other expenses | (220) | (244) |
Income before income tax benefit and equity in undistributed net Income of subsidiary | 1,530 | 956 |
Income tax benefit | 75 | 83 |
Equity in undistributed earnings of subsidiary | 3,773 | 3,751 |
Net income | $ 5,378 | $ 4,790 |
Parent Company Financial Info83
Parent Company Financial Information, Statements of Cash Flows (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Cash flows from operating activities [Abstract] | ||
Net income | $ 5,378 | $ 4,790 |
Adjustments to reconcile net income to net cash provided by operating activities [Abstract] | ||
Net cash from operating activities | 7,148 | 3,751 |
Cash flows from investing activities [Abstract] | ||
Net proceeds from ESOP | 515 | 457 |
Net cash used by investing activities | (42,898) | (25,630) |
Cash flows from financing activities [Abstract] | ||
Dividends paid | (745) | (574) |
Common stock exercised | 165 | 65 |
Common stock repurchased | 0 | (1,261) |
Net cash from financing activities | 42,068 | 40,854 |
Net increase in cash and cash equivalents | 6,318 | 18,975 |
Cash and cash equivalents, beginning of year | 48,264 | 29,289 |
Cash and cash equivalents, end of year | 54,582 | 48,264 |
Sound Financial Bancorp (Parent Only) [Member] | ||
Cash flows from operating activities [Abstract] | ||
Net income | 5,378 | 4,790 |
Adjustments to reconcile net income to net cash provided by operating activities [Abstract] | ||
Other, net | (75) | 312 |
Change in undistributed equity of subsidiary | (3,773) | (3,751) |
Net cash from operating activities | 1,530 | 1,351 |
Cash flows from investing activities [Abstract] | ||
Net proceeds from ESOP | 515 | 457 |
Net cash used by investing activities | 515 | 457 |
Cash flows from financing activities [Abstract] | ||
Dividends paid | (745) | (574) |
Excess tax benefit of stock compensation | 0 | 0 |
Common stock exercised | 165 | 65 |
Common stock repurchased | 0 | (1,261) |
Net cash from financing activities | (580) | (1,770) |
Net increase in cash and cash equivalents | 1,465 | 38 |
Cash and cash equivalents, beginning of year | 451 | 413 |
Cash and cash equivalents, end of year | $ 1,916 | $ 451 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ / shares in Units, $ in Millions | Jan. 30, 2017 | Oct. 28, 2016 |
University Place Branch [Member] | ||
Subsequent Event [Line Items] | ||
Deposits acquired | $ 15.9 | |
Core deposit premium rate | 3.35% | |
Cost of funds rate | 0.17% | |
Subsequent Event [Member] | Dividend Declared [Member] | ||
Subsequent Event [Line Items] | ||
Dividends payable, date declared | Jan. 30, 2017 | |
Cash dividend declared (in dollars per share) | $ 0.10 | |
Dividends payable, date to be paid | Feb. 27, 2017 | |
Dividends payable, date of record | Feb. 13, 2017 |