Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Jun. 30, 2019 | Jul. 31, 2019 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2019 | |
Entity Registrant Name | BayCom Corp | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 12,052,266 | |
Entity Central Index Key | 0001730984 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Trading Symbol | BCML |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
ASSETS | ||
Cash and due from banks | $ 27,587 | $ 20,846 |
Federal funds sold | 324,007 | 302,735 |
Cash and cash equivalents | 351,594 | 323,581 |
Interest bearing deposits in banks | 3,232 | 3,980 |
Investment securities available-for-sale | 100,271 | 99,796 |
Federal Home Loan Bank ("FHLB") stock, at par | 7,174 | 5,162 |
Federal Reserve Bank ("FRB") stock, at par | 4,169 | 4,081 |
Loans held for sale | 1,016 | 855 |
Loans, net of allowance for loan losses of $5,880 and $5,140 at June 30,2019 and December 31, 2018, respectively | 1,213,527 | 970,189 |
Premises and equipment, net | 6,581 | 11,168 |
Other real estate owned ("OREO") | 627 | 801 |
Core deposit intangible | 6,990 | 7,205 |
Cash surrender value of bank owned life insurance policies, net | 19,918 | 19,602 |
Right-of-use assets ("ROU") | 10,598 | |
Goodwill | 26,449 | 14,594 |
Interest receivable and other assets | 19,581 | 17,381 |
Total Assets | 1,771,727 | 1,478,395 |
LIABILITIES AND SHAREHOLDERS' EQUITY | ||
Noninterest and interest bearing deposits | 1,505,382 | 1,257,768 |
Lease liabilities | 10,798 | |
Salary continuation plan | 3,471 | 3,338 |
Interest payable and other liabilities | 9,238 | 8,375 |
Junior subordinated deferrable interest debentures, net | 8,201 | 8,161 |
Total liabilities | 1,537,090 | 1,277,642 |
Commitments and contingencies (Note 15) | ||
Shareholders' equity | ||
Preferred stock - no par value; 10,000,000 shares authorized; no shares issued and outstanding | ||
Common stock - no par value; 100,000,000 shares authorized; 12,052,266 and 10,869,275 shares issued and outstanding at June 30, 2019 and December 31, 2018, respectively | 174,575 | 149,248 |
Additional paid in capital | 287 | 287 |
Accumulated other comprehensive income (loss), net of tax | 1,286 | (103) |
Retained earnings | 58,489 | 51,321 |
Total shareholders' equity | 234,637 | 200,753 |
Total Liabilities and Shareholders' Equity | $ 1,771,727 | $ 1,478,395 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS - (Parenthetical) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Loans, net of allowance for loan losses of $5,880 and $5,140 at June 30,2019 and December 31, 2018, respectively | $ 5,880 | $ 5,140 |
Preferred Stock, No Par Value | $ 0 | $ 0 |
Preferred Stock, Shares Authorized | 10,000,000 | 10,000,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Preferred Stock, Shares Outstanding | 0 | 0 |
Common Stock, No Par Value | $ 0 | $ 0 |
Common Stock, Shares Authorized | 100,000,000 | 100,000,000 |
Common Stock, Shares, Issued | 12,052,266 | 10,869,275 |
Common Stock, Shares, Outstanding | 12,052,266 | 10,869,275 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Interest income: | ||||
Loans, including fees | $ 15,120 | $ 12,074 | $ 28,670 | $ 24,354 |
Investment securities and interest bearing deposits in banks | 2,674 | 1,540 | 5,328 | 2,650 |
FHLB dividends | 92 | 87 | 184 | 180 |
FRB dividends | 62 | 50 | 123 | 119 |
Total interest and dividend income | 17,948 | 13,751 | 34,305 | 27,303 |
Interest expense: | ||||
Deposits | 1,783 | 1,025 | 3,129 | 2,004 |
Other borrowings | 147 | 126 | 293 | 285 |
Total interest expense | 1,930 | 1,151 | 3,422 | 2,289 |
Net interest income | 16,018 | 12,600 | 30,883 | 25,014 |
Provision for loan losses | 445 | 243 | 722 | 497 |
Net interest income after provision for loan losses | 15,573 | 12,357 | 30,161 | 24,517 |
Noninterest income: | ||||
Gain on sale of loans | 903 | 548 | 1,169 | 1,199 |
Service charges and other fees | 663 | 469 | 1,396 | 915 |
Loan servicing fees and other income | 514 | 274 | 924 | 519 |
Gain on sale of premises | 109 | 187 | ||
Gain on sale of OREO | 112 | 112 | ||
Other income | 239 | 792 | 872 | 1,176 |
Total noninterest income | 2,540 | 2,083 | 4,660 | 3,809 |
Noninterest expense: | ||||
Salaries and employee benefits | 7,198 | 4,547 | 13,161 | 9,461 |
Occupancy and equipment | 1,064 | 1,268 | 2,174 | 2,243 |
Data processing | 3,683 | 615 | 4,607 | 1,323 |
Other | 2,850 | 2,226 | 4,601 | 3,752 |
Total noninterest expense | 14,795 | 8,656 | 24,543 | 16,779 |
Income before provision for income taxes | 3,318 | 5,784 | 10,278 | 11,547 |
Provision for income taxes | 1,091 | 1,496 | 3,110 | 3,190 |
Net income | $ 2,227 | $ 4,288 | $ 7,168 | $ 8,357 |
Earnings per common share : | ||||
Basic earnings per common share | $ 0.20 | $ 0.45 | $ 0.64 | $ 0.99 |
Weighted average shares outstanding | 11,384,287 | 9,467,431 | 11,139,287 | 8,495,230 |
Diluted earnings per common share | $ 0.20 | $ 0.45 | $ 0.64 | $ 0.99 |
Weighted average shares outstanding | 11,384,287 | 9,467,431 | 11,139,287 | 8,495,230 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||||
Net income | $ 2,227 | $ 4,288 | $ 7,168 | $ 8,357 |
Other comprehensive income (loss): | ||||
Change in unrealized gain (loss) on available-for-sale securities | 1,112 | (405) | 1,945 | (806) |
Deferred tax (expense) benefit | (320) | 120 | (556) | 239 |
Other comprehensive income (loss), net of tax | 792 | (285) | 1,389 | (567) |
Total comprehensive income | $ 3,019 | $ 4,003 | $ 8,557 | $ 7,790 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock | Additional Paid in Capital | Retained Earnings | Accumulated Other Comprehensive Income/(Loss) | Total |
Balance at Dec. 31, 2017 | $ 81,307 | $ 287 | $ 36,828 | $ 213 | $ 118,635 |
Balance (in shares) at Dec. 31, 2017 | 7,496,995 | ||||
Net income | 4,069 | 4,069 | |||
Other comprehensive loss, net | (282) | (282) | |||
Restricted stock granted (in shares) | 15,232 | ||||
Stock based compensation | $ 146 | 146 | |||
Balance at Mar. 31, 2018 | $ 81,453 | 287 | 40,897 | (69) | 122,568 |
Balance (in shares) at Mar. 31, 2018 | 7,512,227 | ||||
Balance at Dec. 31, 2017 | $ 81,307 | 287 | 36,828 | 213 | 118,635 |
Balance (in shares) at Dec. 31, 2017 | 7,496,995 | ||||
Net income | 8,357 | ||||
Other comprehensive loss, net | (567) | ||||
Balance at Jun. 30, 2018 | $ 148,522 | 287 | 45,185 | (354) | 193,640 |
Balance (in shares) at Jun. 30, 2018 | 10,869,275 | ||||
Balance at Mar. 31, 2018 | $ 81,453 | 287 | 40,897 | (69) | 122,568 |
Balance (in shares) at Mar. 31, 2018 | 7,512,227 | ||||
Net income | 4,288 | 4,288 | |||
Other comprehensive loss, net | (285) | (285) | |||
Restricted stock granted (in shares) | 78,148 | ||||
Stock based compensation | $ 308 | 308 | |||
Initial public offering, net | $ 66,761 | 66,761 | |||
Initial public offering, net (in shares) | 3,278,900 | ||||
Balance at Jun. 30, 2018 | $ 148,522 | 287 | 45,185 | (354) | 193,640 |
Balance (in shares) at Jun. 30, 2018 | 10,869,275 | ||||
Net income | 6,136 | 6,136 | |||
Other comprehensive loss, net | 251 | 251 | |||
Stock based compensation | $ 726 | 726 | |||
Balance at Dec. 31, 2018 | $ 149,248 | 287 | 51,321 | (103) | 200,753 |
Balance (in shares) at Dec. 31, 2018 | 10,869,275 | ||||
Net income | 4,941 | 4,941 | |||
Other comprehensive loss, net | 597 | 597 | |||
Restricted stock granted (in shares) | 22,289 | ||||
Stock based compensation | $ 120 | 120 | |||
Balance at Mar. 31, 2019 | $ 149,368 | 287 | 56,262 | 494 | 206,411 |
Balance (in shares) at Mar. 31, 2019 | 10,891,564 | ||||
Balance at Dec. 31, 2018 | $ 149,248 | 287 | 51,321 | (103) | 200,753 |
Balance (in shares) at Dec. 31, 2018 | 10,869,275 | ||||
Net income | 7,168 | ||||
Other comprehensive loss, net | 1,389 | ||||
Balance at Jun. 30, 2019 | $ 174,575 | 287 | 58,489 | 1,286 | 234,637 |
Balance (in shares) at Jun. 30, 2019 | 12,052,266 | ||||
Balance at Mar. 31, 2019 | $ 149,368 | 287 | 56,262 | 494 | 206,411 |
Balance (in shares) at Mar. 31, 2019 | 10,891,564 | ||||
Net income | 2,227 | 2,227 | |||
Other comprehensive loss, net | 792 | 792 | |||
Restricted stock granted (in shares) | 45,696 | ||||
Stock based compensation | $ 320 | 320 | |||
Stock issued in acquisition | $ 24,887 | 24,887 | |||
Stock issued in acquisition (in shares) | 1,115,006 | ||||
Balance at Jun. 30, 2019 | $ 174,575 | $ 287 | $ 58,489 | $ 1,286 | $ 234,637 |
Balance (in shares) at Jun. 30, 2019 | 12,052,266 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Cash flow from operating activities: | ||
Net income | $ 7,168,000 | $ 8,357,000 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Increase in deferred tax asset | (1,020,000) | (1,433,000) |
Accretion on acquired loans | (1,356,000) | (1,553,000) |
Gain on sale of loans | (1,169,000) | (1,199,000) |
Proceeds from sale of loans | 13,607,000 | 21,298,000 |
Loans originated for sale | (20,544,000) | (23,010,000) |
Write-down on premises | 600,000 | |
Gain on sale of premises | (187,000) | |
Gain on sale of OREO | (112,000) | |
Accretion on junior subordinated debentures | 40,000 | 30,000 |
Increase in cash surrender value of life insurance policies | (316,000) | (155,000) |
Provision for loan losses | 722,000 | 497,000 |
Amortization/accretion of premium/discount on investment securities | 226,000 | 241,000 |
Depreciation and amortization | 562,000 | 458,000 |
Core deposit intangible amortization | 781,000 | 578,000 |
Stock based compensation expense | 440,000 | 454,000 |
Increase (decrease) in deferred loan origination fees, net | 129,000 | (46,000) |
(Increase) decrease in interest receivable and other assets | (7,413,000) | 1,196,000 |
Increase (decrease) in salary continuation plan, net | 133,000 | (840,000) |
Increase (decrease) in interest payable and other liabilities | 10,475,000 | (2,181,000) |
Net cash provided by operating activities | 2,166,000 | 3,292,000 |
Cash flows from investing activities: | ||
Maturity of interest bearing deposits in banks | 748,000 | 498,000 |
Purchase of investment securities | (6,138,000) | (21,772,000) |
Proceeds from the maturity and repayment of investment securities | 12,448,000 | 6,797,000 |
Purchase of Federal Home Loan Bank stock | (477,000) | (325,000) |
Purchase of Federal Reserve Bank stock | (88,000) | (370,000) |
Proceed from death benefit on BOLI investment | 777,000 | |
Net decrease (increase) in loans | 41,831,000 | (14,675,000) |
Proceeds from sale of premises | 4,961,000 | |
Proceeds from sale of OREO | 362,000 | |
Purchase of equipment and leasehold improvements | (286,000) | (432,000) |
Net cash paid in acquisition | (9,342,000) | |
Net cash provided by (used in) investing activities | 44,019,000 | (29,502,000) |
Cash flows from financing activities: | ||
Net (decrease) increase in noninterest and interest bearing deposits | (14,725,000) | 42,089,000 |
Net decrease in time deposits | (3,447,000) | (8,226,000) |
Decrease in other borrowings | (6,000,000) | |
Proceeds from initial public offering, net | 66,761,000 | |
Net cash (used in) provided by financing activities | (18,172,000) | 94,624,000 |
Increase in cash and cash equivalents | 28,013,000 | 68,414,000 |
Cash and cash equivalents at beginning of period | 323,581,000 | 249,853,000 |
Cash and cash equivalents at end of period | 351,594,000 | 318,267,000 |
Supplemental disclosure of cash flow information: | ||
Interest expense | 2,183,000 | 2,260,000 |
Income tax, net of refunds | 4,040,000 | 2,522,000 |
Non-cash investing and financing activities: | ||
Change in unrealized gain (loss) on available-for-sale securities, net of tax | 1,389,000 | $ (567,000) |
Recognition of ROU | 11,411,000 | |
Recognition of lease liability | 11,727,000 | |
Acquisition: | ||
Assets acquired, net of cash received | 289,546,000 | |
Liabilities assumed | 267,172,000 | |
Cash consideration | 37,814,000 | |
Common stock issued | 24,887,000 | |
Goodwill | $ 11,855,000 |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 6 Months Ended |
Jun. 30, 2019 | |
BASIS OF PRESENTATION | |
BASIS OF PRESENTATION | NOTE 1 – BASIS OF PRESENTATION BayCom Corp (the “Company”) is a bank holding company headquartered in Walnut Creek, California. United Business Bank (the “Bank”), the wholly owned banking subsidiary, is a California state-chartered bank which provides a broad range of financial services primarily to local small and mid-sized businesses, service professionals and individuals. In the 15 years of operation, the Bank has grown to 25 full service banking branches. The main office is located in Walnut Creek, California and branch offices are located in Oakland, Castro Valley, Mountain View, Napa, Stockton (2), Pleasanton, Livermore, San Jose, Long Beach, Sacramento, San Francisco, Glendale, Buena Park, Los Angeles, and Garden Grove, California, and Seattle, Washington (2), New Mexico (6). In addition, the Bank has one loan production office in Los Angeles, California. The condensed consolidated financial statements include the accounts of the Company and the Bank. All intercompany transactions and balances have been eliminated in consolidation. The condensed consolidated financial statements include all adjustments of a normal and recurring nature, which are, in the opinion of management, necessary for a fair presentation of the financial position and results of operations for the periods presented. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10‑Q and, therefore, do not include all information and footnotes normally included in annual financial statements prepared in conformity with accounting principles generally accepted in the United States of America. Accordingly, these condensed consolidated financial statements should be read in conjunction with the consolidated audited financial statements and notes thereto for the year ended December 31, 2018. Results of operations for interim periods are not necessarily indicative of results for the full year. Certain prior year information has been reclassified to conform to current year presentation. The reclassifications had no impact on consolidated net income or shareholders’ equity. On November 30, 2018, the Company completed the acquisition of Bethlehem Financial Corporation (“BFC”), the holding company for MyBank, both of Belen, New Mexico (“BFC Merger”) and on May 24, 2019, the Company completed the acquisition of Uniti Financial Corporation ("Uniti”), the holding company for Uniti Bank, both of Buena Park, California ("Uniti Merger"). See Note 3 Acquisitions for additional information on the BFC Merger and the Uniti Merger (collectively the "BFC and Uniti Mergers"). On June 28, 2019, the Company announced the signing of a definitive agreement (the “Agreement”) whereby the Company will acquire TIG Bancorp (“TIG”), in a cash and equity transaction valued at approximately $39.4 million in aggregate based on the closing price of Company common stock on that date. See Note 3 Acquisitions for additional information on the proposed TIG merger. Lease Accounting On January 1, 2019, the Company adopted the new accounting standards that require lessees to recognize operating leases on the Consolidated Balance Sheets as right-of-use assets and lease liabilities based on the value of the discounted future lease payments. Lessor accounting is largely unchanged. Expanded disclosures about the nature and terms of lease agreements are required prospectively and are included in Note 7. The Company elected to retain prior determinations of whether an existing contract contains a lease and how the lease should be classified. The recognition of leases existing on January 1, 2019 did not require an adjustment to beginning retained earnings. Upon adoption, the Company recognized right-of-use assets and lease liabilities of $7.8 million and $8.2 million, respectively. Adoption of the standard did not have a significant effect on the Company’s regulatory capital measures. Revenue Recognition In accordance with Topic 606, revenues are recognized when control of promised goods or services is transferred to customers in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of Topic 606, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of Topic 606, the Company assesses the goods or services that are promised within each contract and identifies those that contain performance obligations; and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. All of the Company’s revenue from contracts with customers in scope of ASC 606 is recognized in noninterest income and included in our commercial and consumer banking segment. For the three and six months ended June 30, 2019, the Company recognized $102,000 and $189,000 in deposit fees, and $43,000 and $85,000 in debit card interchange fees considered in scope of ASC 606, respectively. There was a total of $2.4 million and $4.4 million of noninterest income considered not in scope of ASC 606 for the three and six months ended June 30, 2019. On April 5, 2012, the JOBS Act was signed into law. The JOBS Act contains provisions that, among other things, reduce certain reporting requirements for qualifying public companies. As an “emerging growth company” we may delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies. We intend to take advantage of the benefits of this extended transition period. Accordingly, our condensed consolidated financial statements may not be comparable to companies that comply with such new or revised accounting standards. |
ACCOUNTING STANDARDS RECENTLY I
ACCOUNTING STANDARDS RECENTLY ISSUED OR ADOPTED | 6 Months Ended |
Jun. 30, 2019 | |
ACCOUNTING STANDARDS RECENTLY ISSUED OR ADOPTED | |
ACCOUNTING STANDARDS RECENTLY ISSUED OR ADOPTED | NOTE 2 - ACCOUNTING STANDARDS RECENTLY ISSUED OR ADOPTED In June 2016, the FASB issued ASU No. 2016-13, Measurement of Credit Losses on Financial Instruments (Topic 326) and subsequent amendment to the initial guidance in November 2018, ASU No. 2018-19, Codification Improvements to Topic 326, Financial Instruments—Credit Losses , in April 2019, ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments—Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments, and in May 2019, ASU 2019-05 Financial Instruments—Credit Losses, Topic 326, all of which clarifies codification and corrects unintended application of the guidance. ASU 2016-13 significantly changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. In issuing the standard, the FASB is responding to criticism that today’s guidance delays recognition of credit losses. The standard will replace today’s “incurred loss” approach with an “expected loss” model. The new model, referred to as the current expected credit loss (“CECL”) model, will apply to: (1) financial assets subject to credit losses and measured at amortized cost, and (2) certain off-balance sheet credit exposures. This includes, but is not limited to, loans, leases, held-to-maturity securities, loan commitments, and financial guarantees. The CECL model does not apply to available-for-sale (“AFS”) debt securities. For AFS debt securities with unrealized losses, entities will measure credit losses in a manner similar to what they do today, except that the losses will be recognized as allowances rather than reductions in the amortized cost of the securities. As a result, entities will recognize improvements to estimated credit losses immediately in earnings rather than as interest income over time, as they do today. The ASU also simplifies the accounting model for purchased credit-impaired debt securities and loans. ASU 2016-13 also expands the disclosure requirements regarding an entity’s assumptions, models, and methods for estimating the allowance for loan and lease losses. In addition, public business entities will need to disclose the amortized cost balance for each class of financial asset by credit quality indicator, disaggregated by the year of origination. ASU 2018-19 clarifies that receivables arising from operating leases are accounted for using lease guidance and not as financial instruments. ASU 2019-04, “Codification Improvements to Topic 326, Financial Instruments—Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments,” affects a variety of topics in the Codification and applies to all reporting entities within the scope of the affected accounting guidance. ASU 2019-05 allows entities to irrevocably elect, upon adoption of ASU 2016-13, the fair value option on financial instruments that (1) were previously recorded at amortized cost and (2) are within the scope of ASC 326-20 if the instruments are eligible for the fair value option under ASC 825-10. The fair value option election does not apply to held-to-maturity debt securities. Entities are required to make this election on an instrument-by-instrument basis. These ASUs are effective for interim and annual reporting periods beginning after December 15, 2019 for SEC filers, one year later for non SEC filing public business entities and beginning after December 15, 2021 for nonpublic business entities, however, the FASB board proposed in July 2019 extending the adoption date for certain SEC filers to fiscal years beginning after December 15, 2022. Early adoption is permitted for interim and annual reporting periods beginning after December 15, 2018. Entities will apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective (i.e., modified retrospective approach). The Company is reviewing the requirements of these ASUs and expects to begin developing and implementing processes and procedures to ensure it is fully compliant with the amendments at the adoption date. Upon adoption, the Company expects changes in the processes and procedures used to calculate the allowance for loan losses, including changes in assumptions and estimates to consider expected credit losses over the life of the loan versus the current accounting practice that utilizes the incurred loss model. The new guidance may result in an increase in the allowance for loan losses which will also reflect the new requirement to include the nonaccretable principal differences on purchased credit-impaired loans; however, the Company is still in the process of determining the magnitude of the change and its impact on the Company's consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Accounting for Goodwill Impairment. This guidance removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation, and goodwill impairment will simply be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. All other goodwill impairment guidance will remain largely unchanged. Entities will continue to have the option to perform a qualitative assessment to determine if a quantitative impairment test is necessary. The amendments in this ASU are required for public business entities and other entities that have goodwill reported in their financial statements and have not elected the private company alternative for the subsequent measurement of goodwill. ASU No. 2017-04 is effective for interim and annual reporting periods beginning after December 15, 2019 for public business entities who are not SEC filers and one year later for all other entities. The Company does not expect ASU 2017-04 to have a material impact on its consolidated financial statements. In March 2017, FASB issued ASU 2017-08, Receivables—Nonrefundable Fees and Other Costs (Topic 310) . ASU 2017-08 shortens the amortization period for certain callable debt securities held at a premium to require such premiums to be amortized to the earliest call date unless applicable guidance related to certain pools of securities is applied to consider estimated prepayments. Under prior guidance, entities were generally required to amortize premiums on individual, non-pooled callable debt securities as a yield adjustment over the contractual life of the security. ASU 2017-08 does not change the accounting for callable debt securities held at a discount. The Company adopted ASU 2017-08 on January 1, 2019. The adoption of ASU 2017-08 did not have a material impact on its consolidated financial statements. In June 2018, the FASB issued ASU No. 2018-07, Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. This new guidance simplifies the accounting for share-based payment transactions for acquiring goods and services from nonemployees, applying some of the same requirements as employee share-based payment transactions. This ASU will not affect the accounting for share-based payment awards to nonemployee directors, which will continue to be treated as employee share-based transactions under the current standards. The Company adopted ASU 2018-07 on January 1, 2019. The adoption of ASU 2018-07 did not have a material impact on its consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement . This ASU contains some technical adjustments related to the fair value disclosure requirements of public companies. Included in this ASU is the additional disclosure requirement of unrealized gains and losses for the period in recurring level 3 fair value disclosures and the range and weighted average of significant unobservable inputs, among other technical changes. ASU 2018-13 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted for any removed or modified disclosures. The adoption of ASU 2018-13 is not expected to have a material impact on the Company’s consolidated financial statements. In August 2018, FASB issued ASU No. 2018-15, Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract. The amendments in this ASU broaden the scope of ASC Subtopic 350-40 to include costs incurred to implement a hosting arrangement that is a service contract. The amendments align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). The costs are capitalized or expensed depending on the nature of the costs and the project stage during which they are incurred, consistent with the accounting for costs for internal-use software. The amendments in this ASU result in consistent capitalization of implementation costs of a hosting arrangement that is a service contract and implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). The accounting for the service element of a hosting arrangement that is a service contract is not affected by the amendments in this ASU. This ASU is effective for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years. The amendments in this ASU should be applied either retrospectively to all implementation costs incurred after the date of adoption. Adoption of ASU 2018-15 is not expected to have a material impact on the Company’s consolidated financial statements. In March 2019, FASB issued ASU No. 2019-01, Leases (Topic 842) - Codification Improvements. The changes in this amendment include: (1) determining the fair value of the underlying asset by lessors that are not manufacturers or dealers; (2) presentation on the statement of cash flows – sales types and direct financing leases; and (3) transition disclosures related to Topic 250, Accounting Changes and Error Corrections. This ASU specifically provides an exception to the paragraph 250-10-50-3 that would otherwise have required interim disclosures in the period an accounting change including the effect of that change on income from continuing operations, net income, any other financial statement line item, and any affected per share amounts. For items 1 and 2, this ASU is effective for fiscal and interim periods beginning after December 15, 2019. Item 3 does not have an effective date because the amendments related to transition disclosures are included in Topic 842. The adoption of ASU 2019-01 is not expected to have a material impact on the Company’s consolidated financial statements. |
ACQUISITION
ACQUISITION | 6 Months Ended |
Jun. 30, 2019 | |
ACQUISITION | |
ACQUISITION | NOTE 3 – ACQUISITION On May 24, 2019, the Company completed the Uniti Merger. As of the acquisition date, Uniti merged into the Company and Uniti Bank merged into United Business Bank. The acquisition increased the Company’s market share in California, through the addition of three branch offices located in Southern California. BayCom issued an aggregate of 1,115,006 shares of its common stock and paid aggregate cash consideration of $37.8 million. The total consideration transferred was $62.7 million in the Uniti Merger. On November 30, 2018, the Company completed the BFC Merger. As of the acquisition date, BFC merged into the Company and MyBank merged into United Business Bank. The acquisition increased the Company’s market share in New Mexico through the addition of five branch offices located in Central New Mexico. The Company paid BFC shareholders $62.00 in cash for each share of BFC common stock or $23.5 million in total. The Company assumed subordinated debentures held by a subsidiary of BFC. The primary reason for the BFC and Uniti Mergers was to create depth in the Company's geographic footprint consistent with its ongoing acquisition growth strategy, and to achieve operational scale and realize efficiencies of a larger combined organization. The mergers constitute business acquisitions as defined by FASB ASC 805, Business Combinations. FASB ASC 805 establishes principles and requirements for how the acquirer of a business recognizes and measures in its financial statements the identifiable assets acquired and the liabilities assumed. The Company was considered the acquirer in these transactions. Accordingly, the preliminary estimates of fair values of BFC and Uniti assets, including the identifiable intangible assets, and the assumed liabilities in the BFC Merger and Uniti Merger were measured and recorded as of November 30, 2018 and May 24, 2019, respectively. Fair values on the acquisition dates are preliminary and represent management’s best estimates based on available information and facts and circumstances in existence on the acquisition date. Fair values are subject to refinement for up to one year after the closing date of the acquisitions as additional information regarding the closing date fair values becomes available. The following table summarizes the fair value of the assets acquired and liabilities assumed at the acquisition date: Uniti Merger BFC Merger dated dated May 24, 2019 November 30, 2018 Fair value of assets: Cash and due from banks $ 6,392 $ 4,932 Federal funds sold 22,080 9,346 Total cash and cash equivalents 28,472 14,278 Investment securities available-for-sale 5,096 56,198 FHLB stock, at par 1,535 154 FRB stock, at par — 173 Loans, net 276,719 75,384 Premises and equipment, net 463 3,291 OREO 76 1,066 Core deposit intangible 566 3,604 Cash surrender value of bank owned life insurance policies, net — 2,937 Servicing assets 1,824 — Interest receivable and other assets 3,267 735 Total assets acquired 318,018 157,820 Liabilities: Deposits Noninterest bearing 143,082 97,771 Interest bearing 122,704 37,711 265,786 135,482 Junior subordinated deferrable interest debentures, net — 2,715 Other liabilities 1,386 329 Total liabilities assumed 267,172 138,526 Cash consideration 37,814 23,523 Common stock issued 24,887 — Goodwill $ 11,855 $ 4,229 The following table presents the net assets acquired and the estimated fair value adjustments, which resulted in goodwill at the acquisition date: Uniti Merger BFC Merger dated dated May 24, 2019 November 30, 2018 Book value of net assets acquired $ 47,445 $ 16,201 Fair value adjustments: Investments available-for-sale — (382) Loans, net 4,617 284 Premises and equipment, net — 668 Write-down on OREO (32) (229) Core deposit intangible 566 3,604 Deferred tax assets (695) (1,176) Write-down on servicing assets (805) — Time deposits (250) (54) Junior subordinated deferrable interest debentures, net — 378 Total purchase accounting adjustments 3,401 3,093 Fair value of net assets acquired 50,846 19,294 Price paid: Cash paid 37,814 23,523 Common stock issued 24,887 — Total price paid 62,701 23,523 Goodwill $ 11,855 $ 4,229 Pro Forma Results of Operations The operating results of the Company for the three months and six months ended June 30, 2019 in the condensed consolidated statements of income include the operating results by the net assets acquired in the BFC and Uniti Mergers since the November 30, 2018 and May 24, 2019 merger dates. The following table represents the net interest income, net income, basic and diluted earnings per share, as if the BFC and Uniti Mergers were effective January 1, 2018. The unaudited pro forma information in the following table is intended for informational purposes only and is not necessarily indicative of future operating results or operating results that would have occurred had the mergers been completed at the beginning of the respective year. No assumptions have been applied to the pro forma results of operation regarding possible revenue enhancements, expense efficiencies or asset dispositions. Unaudited pro forma net interest income, net income and earnings per share are presented below: Three months ended June 30, Six months ended June 30, 2019 2018 2019 2018 Net interest income $ 17,735 $ 17,680 $ 34,148 $ 33,302 Net income 1,118 5,612 6,632 10,551 Basic earnings per share $ 0.09 $ 0.53 $ 0.55 $ 1.10 Diluted earnings per share $ 0.09 $ 0.53 $ 0.55 $ 1.10 These amounts include the acquisition-related third party expenses, accretion of the discounts on acquired loans and amortization of the fair value mark adjustments on core deposit intangible. Acquisition Related Expenses Acquisition expenses are recognized in the periods in which the costs are incurred and the services are received. The Company incurred third-party acquisition expenses in the consolidated statements of income for the periods indicated as follows: Uniti Merger BFC Merger Six months ended Year ended June 30, 2019 December 31, 2018 Professional fees $ 535 $ 130 Data processing 2,657 1,290 Severance expense 578 536 Other 365 369 Total $ 4,135 $ 2,325 Pending Acquisition On June 28, 2019, BayCom Corp entered into an Agreement and Plan of Merger with TIG Bancorp (the “Agreement”), headquartered in Greenwood Village, Colorado pursuant to which TIG will be merged with and into the Company, and immediately thereafter TIG’s bank subsidiary, First State Bank of Colorado, will be merged with and into United Business Bank. First State Bank of Colorado serves the Denver metropolitan area and nearby Colorado communities through seven branch offices. Subject to the terms and conditions of the Agreement, at the effective time of the merger each TIG shareholder will receive (i) $6.34 in cash and (ii) 0.27543 shares of Company common stock. Based on the closing price of the Company’s common stock of $21.90 on June 28, 2019, the consideration value per share of TIG was $12.37 or approximately $39.4 million in aggregate. The total value of the merger consideration will fluctuate until closing based on the value of the Company's stock price. Upon consummation of the Merger, the shareholders of TIG will own approximately 6.8% of the combined company. The Agreement has been unanimously approved by the boards of directors of both the Company and TIG. The merger is subject to approval by TIG’s shareholders and certain other customary closing conditions and is expected to close in the fourth quarter of 2019. At June 30, 2019, TIG had approximately $230.5 million in total assets, $145.7 million in total loans, $197.0 million in total deposits and $32.0 million in shareholders’ equity. The unaudited pro forma information in the following table is intended for informational purposes only and is not necessarily indicative of future operating results or operating results that would have occurred had the merger with TIG had been completed at the beginning of each respective year. No assumptions have been applied to the pro forma results of operation regarding possible revenue enhancements, expense efficiencies or asset dispositions. Three months ended Six months ended June 30, June 30, 2019 2018 2019 2018 Net interest income $ 18,405 $ 15,014 $ 35,813 $ 29,631 Net income 2,780 4,884 8,344 9,307 Basic earnings per share $ 0.23 $ 0.47 $ 0.69 $ 0.99 Diluted earnings per share $ 0.23 $ 0.47 $ 0.69 $ 0.99 |
INVESTMENT SECURITIES
INVESTMENT SECURITIES | 6 Months Ended |
Jun. 30, 2019 | |
INVESTMENT SECURITIES | |
INVESTMENT SECURITIES | NOTE 4 – INVESTMENT SECURITIES The amortized cost, gross unrealized gains and losses, and estimated fair values of securities available-for-sale at the dates indicated are summarized as follows: Gross Gross Amortized unrealized unrealized Estimated June 30, 2019 cost gains losses fair value U.S. Treasuries $ 993 $ 3 $ — $ 996 U.S. Government Agencies 13,512 89 (14) 13,587 Municipal securities 17,153 326 (15) 17,464 Mortgage-backed securities 28,802 852 (8) 29,646 Collateralized mortgage obligations 23,685 492 (11) 24,166 SBA securities 4,280 9 (48) 4,241 Corporate bonds 10,040 135 (4) 10,171 Total $ 98,465 $ 1,906 $ (100) $ 100,271 Gross Gross Amortized unrealized unrealized Estimated December 31, 2018 cost gains losses fair value U.S. Treasuries $ 984 $ 1 $ — $ 985 U.S. Government Agencies 13,761 21 (17) 13,765 Municipal securities 19,604 65 (166) 19,503 Mortgage-backed securities 49,565 243 (206) 49,602 Collateralized mortgage obligations 4,705 32 (20) 4,717 SBA securities 4,300 2 (61) 4,241 Corporate bonds 7,016 4 (37) 6,983 Total $ 99,935 $ 368 $ (507) $ 99,796 The estimated fair value and gross unrealized losses for securities available-for-sale aggregated by the length of time that individual securities have been in a continuous unrealized loss position at the dates indicated are as follows: Less than 12 months 12 months or more Total Estimated Unrealized Estimated Unrealized Estimated Unrealized June 30, 2019 fair value loss fair value loss fair value loss U.S. Treasuries $ — $ — $ — $ — $ — $ — U.S. Government Agencies 1,509 (14) — — 1,509 (14) Municipal securities 529 (4) 1,872 (11) 2,401 (15) Mortgage-backed securities 721 (5) 1,313 (3) 2,034 (8) Collateralized mortgage obligations 926 (10) 322 (1) 1,248 (11) SBA securities — — 2,489 (48) 2,489 (48) Corporate bonds 1,518 (4) — — 1,518 (4) Total $ 5,203 $ (37) $ 5,996 $ (63) $ 11,199 $ (100) Less than 12 months 12 months or more Total Estimated Unrealized Estimated Unrealized Estimated Unrealized December 31, 2018 fair value loss fair value loss fair value loss U.S. Treasuries $ — $ — $ — $ — $ — $ — U.S. Government Agencies 4,014 (9) 1,743 (8) 5,757 (17) Municipal securities 6,883 (35) 7,537 (131) 14,420 (166) Mortgage-backed securities 14,919 (91) 6,054 (115) 20,973 (206) Collateralized mortgage obligations 2,427 (9) 477 (11) 2,904 (20) SBA securities 677 (32) 2,336 (29) 3,013 (61) Corporate bonds 4,975 (37) — — 4,975 (37) Total $ 33,895 $ (213) $ 18,147 $ (294) $ 52,042 $ (507) At June 30, 2019, the Company held 214 investment securities, of which 20 were in an unrealized loss position for more than twelve months and 22 were in an unrealized loss position for less than twelve months. These temporary unrealized losses relate principally to current interest rates for similar types of securities. The Company anticipates full recovery of amortized cost with respect to these securities at maturity or sooner in the event of a more favorable market interest rate environment. The amortized cost and estimated fair value of securities available-for-sale at the dates indicated by contractual maturity are shown below. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. June 30, 2019 December 31, 2018 Amortized Estimated Amortized Estimated cost fair value cost fair value Available-for-sale: Due in one year or less $ 12,031 $ 12,057 $ 14,292 $ 14,279 Due after one through five years 28,978 29,439 26,287 26,327 Due after five years through ten years 20,258 20,720 20,840 20,758 Due after ten years 37,198 38,055 38,516 38,432 Total $ 98,465 $ 100,271 $ 99,935 $ 99,796 For both the three and six months ended June 30, 2019 and 2018, no realized gains or losses were recorded. |
LOANS
LOANS | 6 Months Ended |
Jun. 30, 2019 | |
LOANS | |
LOANS | NOTE 5 - LOANS The Company’s loan portfolio at the dates indicated is summarized below: June 30, December 31, 2019 2018 Commercial and industrial $ 151,862 $ 121,855 Construction and land 30,502 47,302 Commercial real estate 902,896 701,983 Residential 128,590 102,708 Consumer 6,052 1,847 Total loans 1,219,902 975,695 Net deferred loan fees (495) (366) Allowance for loan losses (5,880) (5,140) Net loans $ 1,213,527 $ 970,189 The Company’s total impaired loans, including nonaccrual loans, accruing loans modified as troubled debt restructurings (“TDRs”), and accreting purchase credit impaired (“PCI”) loans that have experienced post-acquisition declines in cash flows expected to be collected are summarized as follows: Commercial and Construction Commercial industrial and land real estate Residential Consumer Total June 30, 2019 Recorded investment in impaired loans: With no specific allowance recorded $ 2,231 $ — $ 2,215 $ 120 $ — $ 4,566 With a specific allowance recorded 19 — — — — 19 Total recorded investment in impaired loans $ 2,250 $ — $ 2,215 $ 120 $ — $ 4,585 Specific allowance on impaired loans 19 — — — — 19 December 31, 2018 Recorded investment in impaired loans: With no specific allowance recorded $ 1,868 $ — $ 1,346 $ 654 $ — $ 3,868 With a specific allowance recorded 10 — — — — 10 Total recorded investment in impaired loans $ 1,878 $ — $ 1,346 $ 654 $ — $ 3,878 Specific allowance on impaired loans 10 — — — — 10 Three months ended June 30, 2019 Average recorded investment in impaired loans $ 2,326 $ — $ 1,386 $ 282 $ — $ 3,994 Interest recognized 1 — — — — 1 Six months ended June 30, 2019 Average recorded investment in impaired loans 2,347 — 1,162 441 — 3,950 Interest recognized 34 — 20 1 — 55 Three months ended June 30, 2018 Average recorded investment in impaired loans 702 — 890 132 — 1,724 Interest recognized — — 6 — — 6 Six months ended June 30, 2018 Average recorded investment in impaired loans 102 — 1,002 74 — 1,178 Interest recognized 10 — 11 2 — 23 Impaired loans on accrual are loans that have been restructured and are performing under modified loan agreements, and principal and interest is determined to be collectible. Nonaccrual loans are loans where principal and interest have been determined to not be fully collectible. The following table presents nonaccrual loans at the dates indicated: June 30, December 31, 2019 2018 Commercial and industrial $ 2,250 $ 1,878 Construction and land — — Commercial real estate 1,452 596 Residential 120 654 Consumer — — Total $ 3,822 $ 3,128 The balance of nonaccrual loans guaranteed by a government agency, which reduce the Company’s credit exposure, was $3.0 million and none as of June 30, 2019 and December 31, 2018, respectively. Interest foregone on nonaccrual loans was approximately $46,000 and $88,000 for the three and six months ended June 30, 2019 compared to $8,500 and $10,500 for the three and six months ended June 30, 2018, respectively. In situations where, for economic or legal reasons related to a borrower’s financial difficulties, the Company grants a concession to the borrower that it would not otherwise consider, the related loan is classified as a TDR. TDRs are generally placed on nonaccrual status at the time of restructuring and included in impaired loans. These loans are returned to accrual status after the borrower demonstrates performance with the modified terms for a sustained period of time (generally six months) and has the capacity to continue to perform in accordance with the modified terms of the restructured debt. At both June 30, 2019 and December 31, 2018, the TDR portfolio totaled $1.4 million. At June 30, 2019, $763,000 of TDR loans were performing in accordance with their modified terms. At June 30, 2019, the Company had no commitments to extend additional credit to borrowers whose loan terms have been modified in TDRs. All TDRs are also included in the loans individually evaluated for impairment as part of the calculation of the allowance for loan losses. As of June 30, 2019 and December 31, 2018, TDR loans had a related allowance of $10,000. No loans accounted for as TDRs were charged-off to the allowance for loan losses for either the three or six months ended June 30, 2019 and 2018. There were no TDRs for which there was a payment default within the first 12 months of the modification during the six months ended June 30, 2019. The following tables present TDR loans by class, during the periods indicated: Number of Rate Term Interest only Combined Three months ended June 30, 2019 loans modification modification modification modification Total Commercial and industrial — $ — $ — $ — $ — $ — Construction and land — — — — — — Commercial real estate — — — — — — Residential — — — — — — Consumer — — — — — — Total — $ — $ — $ — $ — $ — Number of Rate Term Interest only Combined Six months ended June 30, 2019 loans modification modification modification modification Total Commercial and industrial 2 $ — $ 176 $ — $ 321 $ 497 Construction and land — — — — — — Commercial real estate — — — — — — Residential — — — — — — Consumer — — — — — — Total 2 $ — $ 176 $ — $ 321 $ 497 Number of Rate Term Interest only Combined Three months ended June 30, 2018 loans modification modification modification modification Total Commercial and industrial — $ — $ — $ — $ — $ — Construction and land — — — — — — Commercial real estate — — — — — — Residential 1 — 129 — — 129 Consumer — — — — — — Total 1 $ — $ 129 $ — $ — $ 129 Number of Rate Term Interest only Combined Six months ended June 30, 2018 loans modification modification modification modification Total Commercial and industrial 1 $ — $ — $ — $ 11 $ 11 Construction and land — — — — — — Commercial real estate 1 — — — 776 776 Residential 1 — 129 — — 129 Consumer — — — — — — Total 3 $ — $ 129 $ — $ 787 $ 916 Risk Rating System The Company evaluates and assigns a risk grade to each loan based on certain criteria to assess the credit quality of each loan. The assignment of a risk rating is done for each individual loan. Loans are graded from inception and on a continuing basis until the debt is repaid. Any adverse or beneficial trends will trigger a review of the loan risk rating. Each loan is assigned a risk grade based on its characteristics. Loans with low to average credit risk are assigned a lower risk grade than those with higher credit risk as determined by the individual loan characteristics. The Company’s Pass loans includes loans with acceptable business or individual credit risk where the borrower’s operations, cash flow or financial condition provides evidence of low to average levels of risk. Loans that are assigned higher risk grades are loans that exhibit the following characteristics: A Special Mention asset has potential weaknesses that deserve close attention. If left uncorrected, these potential weaknesses may result in a deterioration of the repayment prospects for the asset or in the Company’s credit position at some future date. Special Mention assets are not adversely classified and do not expose the Company to sufficient risk to warrant adverse classification. Loans in this category would be characterized by any of the following situations: · Credit that is currently protected but is potentially a weak asset; · Credit that is difficult to manage because of an inadequate loan agreement, the condition of and/or control over collateral, failure to obtain proper documentation, or any other deviation from product lending practices; and · Adverse financial trends. A Special Mention rating should be a temporary rating, pending the occurrence of an event that would cause the risk rating to either improve or to be downgraded. A Substandard asset is inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged. Assets so classified must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. Assets are characterized by the distinct possibility that the Company will sustain some loss if the deficiencies are not corrected. The potential loss does not have to be recognizable in an individual credit for that credit to be risk rated Substandard. A loan can be fully and adequately secured and still be considered Substandard. Some characteristics of Substandard loans are: · Inability to service debt from ordinary and recurring cash flow; · Chronic delinquency; · Reliance upon alternative sources of repayment; · Term loans that are granted on liberal terms because the borrower cannot service normal payments for that type of debt; · Repayment dependent upon the liquidation of collateral; · Inability to perform as agreed, but adequately protected by collateral; · Necessity to renegotiate payments to a non-standard level to ensure performance; and · The borrower is bankrupt, or for any other reason, future repayment is dependent on court action. Any asset classified Doubtful has all the weaknesses inherent in one classified as Substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and value, highly questionable and improbable. Doubtful assets have a high probability of loss, yet certain important and reasonably specific pending factors may work toward the strengthening of the asset. Losses are recognized as charges to the allowance when the loan or portion of the loan is considered uncollectible or at the time of foreclosure. Recoveries on loans previously charged off are credited to the allowance for loan losses. The following tables present the internally assigned risk grade by class of loans at the dates indicated: June 30, 2019 Pass mention Substandard Doubtful Total Commercial and industrial $ 149,943 $ 1,253 $ 666 $ — $ 151,862 Construction and land 27,618 147 2,737 — 30,502 Commercial real estate 882,714 16,038 4,144 — 902,896 Residential 127,239 1,231 120 — 128,590 Consumer 6,041 11 — — 6,052 Total $ 1,193,555 $ 18,680 $ 7,667 $ — $ 1,219,902 Special December 31, 2018 Pass mention Substandard Doubtful Total Commercial and industrial $ 119,926 $ 1,302 $ 627 $ — $ 121,855 Construction and land 44,490 — 2,812 — 47,302 Commercial real estate 686,154 12,120 3,709 — 701,983 Residential 101,908 147 653 — 102,708 Consumer 1,847 — — — 1,847 Total $ 954,325 $ 13,569 $ 7,801 $ — $ 975,695 The following tables provide an aging of the Company’s loans receivable as of the dates indicated: Recorded 90 Days investment > 30-59 Days 60-89 Days or more Total Total loans 90 days and June 30, 2019 past due past due past due past due Current PCI loans receivable accruing Commercial and industrial $ 579 $ 359 $ 1,763 $ 2,701 $ 148,385 $ 776 $ 151,862 $ — Construction and land 93 — — 93 30,189 220 30,502 — Commercial real estate 306 3,916 1,960 6,182 880,865 15,849 902,896 597 Residential — 39 — 39 126,795 1,756 128,590 — Consumer — 5 — 5 6,047 — 6,052 — Total $ 978 $ 4,319 $ 3,723 $ 9,020 $ 1,192,281 $ 18,601 $ 1,219,902 $ 597 Recorded 90 Days investment > 30-59 Days 60-89 Days or more Total Total loans 90 days and December 31, 2018 past due past due past due past due Current PCI loans receivable accruing Commercial and industrial $ 270 $ 349 $ 1,861 $ 2,480 $ 119,373 $ 2 $ 121,855 $ — Construction and land — — — — 47,069 233 47,302 — Commercial real estate 2,345 356 501 3,202 688,005 10,776 701,983 — Residential 93 — 57 150 100,765 1,793 102,708 — Consumer — 4 — 4 1,843 — 1,847 — Total $ 2,708 $ 709 $ 2,419 $ 5,836 $ 957,055 $ 12,804 $ 975,695 $ — Purchase Credit Impaired Loans As part of acquisitions, the Company has purchased loans, some of which have shown evidence of credit deterioration since origination and it is probable at the acquisition that all contractually requirement payments would not be collected. The unpaid principal balance and carrying value of the Company’s PCI loans at the dates indicated are as follows: June 30, 2019 December 31, 2018 Unpaid Unpaid principal Carrying principal Carrying balance value balance value Commercial and industrial $ 1,462 $ 776 $ 125 $ 2 Construction and land 319 220 335 233 Commercial real estate 18,568 15,849 12,605 10,776 Residential 2,340 1,756 2,381 1,793 Consumer — — — — Total $ 22,689 $ 18,601 $ 15,446 $ 12,804 The following table summarized the accretable yield on the purchased credit impaired loans for the periods indicated: Three months ended Six months ended June 30, June 30, 2019 2018 2019 2018 Balance at beginning of period $ 231 $ 353 $ 256 $ 372 Additions 350 — 350 — Accretion (24) (78) (46) (97) Payoffs — — (3) — Balance at end of period $ 557 $ 275 $ 557 $ 275 |
ALLOWANCE FOR LOAN LOSSES
ALLOWANCE FOR LOAN LOSSES | 6 Months Ended |
Jun. 30, 2019 | |
ALLOWANCE FOR LOAN LOSSES | |
ALLOWANCE FOR LOAN LOSSES | NOTE 6 – ALLOWANCE FOR LOAN LOSSES The following tables summarize the Company’s allowance for loan losses individually and collectively evaluated for impairment by loan product as of or for the periods ending as indicated: Commercial Construction Commercial Three months ended June 30, 2019 and industrial and land real estate Residential Consumer Unallocated Total Allowance for loan losses Beginning balance $ 1,135 $ 340 $ 3,326 $ 235 $ 2 $ 367 $ 5,405 Charge-offs — — — — — — — Recoveries 30 — — — — — 30 Provision for loan losses 85 (74) 527 (10) — (83) 445 Ending balance $ 1,250 $ 266 $ 3,853 $ 225 $ 2 $ 284 $ 5,880 Commercial Construction Commercial Six months ended June 30, 2019 and industrial and land real estate Residential Consumer Unallocated Total Allowance for loan losses Beginning balance $ 1,017 $ 327 $ 3,214 $ 215 $ 3 $ 364 $ 5,140 Charge-offs — — (17) — (4) — (21) Recoveries 39 — — — — — 39 Provision for loan losses 194 (61) 656 10 3 (80) 722 Ending balance $ 1,250 $ 266 $ 3,853 $ 225 $ 2 $ 284 $ 5,880 June 30, 2019 Allowance for loan losses related to: Loans individually evaluated for impairment $ 19 $ — $ — $ — $ — $ — $ 19 Loans collectively evaluated for impairment 1,233 266 3,490 587 1 284 5,861 PCI loans — — — — — — — Commercial Construction Commercial Three months ended June 30, 2018 and industrial and land real estate Residential Consumer Unallocated Total Allowance for loan losses Beginning balance $ 1,005 $ 251 $ 2,782 $ 160 $ — $ 402 $ 4,600 Charge-offs (251) — — — — — (251) Recoveries 8 — — — — — 8 Provision for loan losses 140 41 179 15 2 (134) 243 Ending balance $ 902 $ 292 $ 2,961 $ 175 $ 2 $ 268 $ 4,600 Commercial Construction Commercial Six months ended June 30, 2018 and industrial and land real estate Residential Consumer Unallocated Total Allowance for loan losses Beginning balance $ 841 $ 199 $ 2,695 $ 150 $ 3 $ 327 $ 4,215 Charge-offs (251) — — — — — (251) Recoveries 139 — — — — — 139 Provision for loan losses 173 93 266 25 (1) (59) 497 Ending balance $ 902 $ 292 $ 2,961 $ 175 $ 2 $ 268 $ 4,600 June 30, 2018 Allowance for loan losses related to: Loans individually evaluated for impairment $ 11 $ — $ — $ — $ — $ — $ 11 Loans collectively evaluated for impairment 891 292 2,961 175 2 268 4,589 PCI loans — — — — — — — |
PREMISES AND EQUIPMENT
PREMISES AND EQUIPMENT | 6 Months Ended |
Jun. 30, 2019 | |
PREMISES AND EQUIPMENT | |
PREMISES AND EQUIPMENT | NOTE 7 – PREMISES AND EQUIPMENT Premises and equipment consisted of the following at the dates indicated: June 30, December 31, 2019 2018 Premises owned $ 4,571 $ 10,267 Write-down on premises owned — (600) Premises owned, net 4,571 9,667 Leasehold improvements 2,178 1,654 Furniture, fixtures and equipment 4,016 3,835 Less accumulated depreciation and amortization (4,184) (3,988) Total premises and equipment, net $ 6,581 $ 11,168 Depreciation and amortization included in occupancy and equipment expense for the three months and six months ended June 30, 2019 was $261,000 and $562,000 compared to $227,000 and $458,000 for the three and six months ended June 30, 2018, respectively. On March 29, 2019, the Company sold a commercial building in Oakland, California with a carrying value of $4.6 million. In connection with the sale, the Company leased back 4,021 square feet, representing 11.1% of the total square footage. The sale resulted in a $78,000 gain, included in noninterest income. The Company leases 16 branches and administration offices under noncancelable operating leases. These leases expire on various dates through 2025. All leases have an option to renew one or more times following the expiration of the initial term with renewal periods between three and twelve years. The Company adopted the requirements of Topic 842 effective January 1, 2019, which required the Company record a right of use lease asset and a lease liability for leases with an initial term of more than 12 months for leases that existed as of January 1, 2019. The periods prior to the date of adoption are accounted for under Lease Topic 840; therefore, the following disclosures of future minimum lease payments as of June 30, 2019, include only the periods for which Topic 842 was effective: Year ending December 31, $ 1,465 2,759 2,431 1,801 1,299 Thereafter 1,906 Total lease payments 11,661 Less: interest (863) Present value of lease liabilities $ 10,798 The following table presents the weighted average operating lease term and discount rate at the date indicated: June 30, 2019 Weighted-average remaining lease term 5.06 years Weighted-average discount rate 2.89 % |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 6 Months Ended |
Jun. 30, 2019 | |
GOODWILL AND INTANGIBLE ASSETS | |
GOODWILL AND INTANGIBLE ASSETS | NOTE 8 – GOODWILL AND INTANGIBLE ASSETS Goodwill Changes in the Company’s goodwill for the periods indicated are as follows: June 30, December 31, 2019 2018 Balance, January 1 $ 14,594 $ 10,365 Acquired goodwill 11,855 4,229 Impairment — — Balance at end of period $ 26,449 $ 14,594 Impairment exists when a reporting unit’s carrying value of goodwill exceeds its fair value. As of June 30, 2019, the Company had positive equity and the Company elected to perform a qualitative assessment to determine if it was more likely than not that the fair value of the Company exceeded its carrying value, including goodwill. The qualitative assessment indicated that it was more likely than not that its fair value exceeded its carrying value, resulting in no impairment. Core Deposit Intangible Changes in the Company’s core deposit intangible for the periods indicated were as follows: June 30, December 31, 2019 2018 Balance, January 1 $ 7,205 $ 4,772 Additions 566 3,604 Less amortization (781) (1,171) Balance at end of period $ 6,990 $ 7,205 The Company recorded total amortization expense of $392,000 and $781,000 for the three and six months ended June 30, 2019 compared to $289,000 and $578,000 for the three and six months ended June 30, 2018, respectively. Estimated annual amortization at June 30, 2019 is as follows: Year ending December 31, $ 778 1,441 1,418 1,418 642 Thereafter 1,293 Total $ 6,990 |
INTEREST RECEIVABLE AND OTHER A
INTEREST RECEIVABLE AND OTHER ASSETS | 6 Months Ended |
Jun. 30, 2019 | |
INTEREST RECEIVABLE AND OTHER ASSETS | |
INTEREST RECEIVABLE AND OTHER ASSETS | NOTE 9 – INTEREST RECEIVABLE AND OTHER ASSETS The Company’s interest receivable and other assets at the dates indicated consisted of the following: June 30, December 31, 2019 2018 Deferred tax assets, net $ 7,295 $ 5,891 Accrued interest receivable 4,228 3,676 Investment in SBIC Fund 2,113 1,347 Prepaid assets 1,322 2,156 Servicing asset 2,446 814 Low income housing partnership, net 705 607 Investment in statutory trusts 395 395 All other 1,077 2,495 Total $ 19,581 $ 17,381 |
DEPOSITS
DEPOSITS | 6 Months Ended |
Jun. 30, 2019 | |
DEPOSITS | |
DEPOSITS | NOTE 10 – DEPOSITS The Company’s deposits consisted of the following at the dates indicated: June 30, December 31, 2019 2018 Demand deposits $ 538,504 $ 398,045 NOW accounts and savings 248,029 246,288 Money market 385,934 398,081 Time under $250,000 189,842 117,653 Time $250,000 and over 143,073 97,701 Total $ 1,505,382 $ 1,257,768 |
INTEREST PAYABLE AND OTHER LIAB
INTEREST PAYABLE AND OTHER LIABILITIES | 6 Months Ended |
Jun. 30, 2019 | |
INTEREST PAYABLE AND OTHER LIABILITIES | |
INTEREST PAYABLE AND OTHER LIABILITIES | NOTE 11 - INTEREST PAYABLE AND OTHER LIABILITIES The Company’s interest payable and other liabilities at the dates indicated consisted of the following: June 30, December 31, 2019 2018 Accrued expenses $ 5,448 $ 5,508 Deferred rents — 528 CDARs deferred fees 434 494 Accounts payable 1,044 811 Reserve for unfunded commitments 375 330 Accrued interest payable 1,453 198 Miscellaneous other liabilities 484 506 Total $ 9,238 $ 8,375 |
OTHER EXPENSES
OTHER EXPENSES | 6 Months Ended |
Jun. 30, 2019 | |
OTHER EXPENSES | |
OTHER EXPENSES | NOTE 12– OTHER EXPENSES The Company’s other expenses at the dates indicated consisted of the following: Three months ended Six months ended June 30, June 30, 2019 2018 2019 2018 Professional fees $ 867 $ 557 $ 1,264 $ 898 Core deposit premium amortization 392 290 781 578 Marketing and promotions 396 248 606 459 Stationary and supplies 161 91 298 215 Insurance (including FDIC premiums) 159 107 315 265 Communication and postage 112 109 207 222 Loan default related expense 119 3 150 44 Director fees 375 72 496 131 Bank service charges 19 18 31 47 Courier expense 117 110 231 227 Write-down on premises — 600 — 600 Other expenses 133 21 222 66 Total $ 2,850 $ 2,226 $ 4,601 $ 3,752 |
EQUITY INCENTIVE PLANS
EQUITY INCENTIVE PLANS | 6 Months Ended |
Jun. 30, 2019 | |
EQUITY INCENTIVE PLANS | |
EQUITY INCENTIVE PLANS | NOTE 13 – EQUITY INCENTIVE PLANS 2017 Omnibus Equity Incentive Plan The shareholders approved the Omnibus Equity Incentive Plan (“2017 Plan”) in November 2017. The 2017 Plan provides for the awarding by the Company’s Board of Directors of equity incentive awards to employees and non-employee directors. An equity incentive award may be an option, stock appreciation rights, restricted stock units, stock award, other stock-based award or performance award granted under the 2017 Plan. Factors considered by the Board in awarding equity incentives to officers and employees include the performance of the Company, the employee’s or officer’s job performance, the importance of his or her position, and his or her contribution to the organization’s goals for the award period. Generally, awards are restricted and have a vesting period of no longer than ten years. Subject to adjustment as provided in the 2017 Plan, the maximum number of shares of common stock that may be delivered pursuant to awards granted under the 2017 Plan is 450,000. The 2017 Plan provides for an annual restricted stock grant limits to officers, employees and directors. The annual stock grant limit per person for officers and employees is the lessor of 50,000 shares or a value of $2.0 million, and per person for directors, the maximum is 25,000 shares. All unvested restricted shares outstanding vest in the event of a change in control of the Company. Awarded shares of restricted stock vest over (i) a one-year period following the date of grant, in the case of the non-employee directors, and (ii) a three-year or five-year period following the date of grant, with the initial vesting occurring on the one-year anniversary of the date of grant, in the case of the executive officers. As of June 30, 2019, a total of 161,365 equity incentive awards have been granted under the 2017 Plan, all which are awards of restricted stock. 2014 Omnibus Equity Incentive Plan In 2014, the shareholders approved the Omnibus Equity Incentive Plan (the “2014 Plan”). A total of 148,962 equity incentive awards were granted under the 2014 Plan. The awards are shares of restricted stock and have a vesting period of one to five years. No future equity awards will be made from the 2014 Plan. The Company recognizes compensation expense for the restricted stock awards based on the fair value of the shares at the award date. For the three and six months ended June 30, 2019, total compensation expense for these plans was $320,000 and $440,000, respectively, compared to $308,000 and $454,000 for the three and six months ended June 30, 2018, respectively. As of June 30, 2019, there was $2.6 million of total unrecognized compensation cost related to non-vested shares granted as restricted stock awards. The cost is expected to be recognized over the remaining weighted-average vesting period of approximately two years. The following table provides the restricted stock grant activity for the periods indicated: 2019 2018 Weighted-average Weighted-average grant date grant date Shares fair value Shares fair value Non-vested at January 1, 131,000 $ 19.18 67,481 $ 13.51 Granted 22,289 22.38 15,232 19.45 Vested (19,253) 19.51 (8,706) 13.40 Non-vested at March 31, 134,036 20.76 74,007 14.60 Granted 45,696 24.60 78,148 22.00 Vested (36,582) 19.55 — — Non-vested at June 30, 143,150 21.63 152,155 19.05 |
FAIR VALUE MEASUREMENT
FAIR VALUE MEASUREMENT | 6 Months Ended |
Jun. 30, 2019 | |
FAIR VALUE MEASUREMENT | |
FAIR VALUE MEASUREMENT | NOTE 14 – FAIR VALUE MEASUREMENT The following tables have information about the Company’s assets and liabilities measured at fair value and the fair value techniques used to determine such fair value. The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels (Level 1, Level 2, and Level 3). Level 1 - Inputs are unadjusted quoted prices in active markets (as defined) for identical assets or liabilities that the Company has the ability to access at the measurement date. Level 2 - Inputs are inputs other than quoted prices include quoted prices for similar assets and liabilities in active markets, and inputs other than quoted prices that are observable for the asset or liability such as interest rates and yield curves that are observable at commonly quoted intervals. Level 3 - Inputs are unobservable inputs for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability. In certain cases, the inputs used to measure fair value may fall into different levels of the hierarchy. In such cases, the lowest level of inputs that is significant to the measurement is used to determine the hierarchy for the entire asset or liability. Transfers between levels of the fair value hierarchy are recognized on the actual date of the event or circumstances that caused the transfer, which generally coincides with our quarterly valuation process. There were no transfers between levels during 2019 or 2018. The following assets are measured at fair value on a recurring basis at the dates indicated: June 30, 2019 Total Level 1 Level 2 Level 3 U.S. Treasuries $ 996 $ 996 $ — $ — U.S. Government Agencies 13,587 — 13,587 — Municipal securities 17,464 — 17,464 — Mortgage-backed securities 29,646 — 29,646 — Collateralized mortgage obligations 24,166 — 24,166 — SBA securities 4,241 — 4,241 — Corporate bonds 10,171 — 10,171 — Total assets measured at fair value $ 100,271 $ 996 $ 99,275 $ — December 31, 2018 Total Level 1 Level 2 Level 3 U.S. Treasuries $ 985 $ 985 $ — $ — U.S. Government Agencies 13,765 — 13,765 — Municipal securities 19,503 — 19,503 — Mortgage-backed securities 49,602 — 49,602 — Collateralized mortgage obligations 6,983 — 6,983 — SBA securities 4,241 — 4,241 — Corporate bonds 4,717 — 4,717 — Total assets measured at fair value $ 99,796 $ 985 $ 98,811 $ — The following assets are measured at fair value on a nonrecurring basis as of the dates indicated: June 30, 2019 Total Level 1 Level 2 Level 3 Performing impaired loans $ 763 $ — $ — $ 763 Nonperforming impaired loans 3,822 — — 3,822 OREO 627 — — 627 Total assets measured at fair value $ 5,212 $ — $ — $ 5,212 December 31, 2018 Total Level 1 Level 2 Level 3 Performing impaired loans $ 750 $ — $ — $ 750 Nonperforming impaired loans 3,128 — — 3,128 OREO 801 — — 801 Total assets measured at fair value $ 4,679 $ — $ — $ 4,679 The Company does not record loans at fair value on a recurring basis. However, from time to time, a loan may be considered impaired and an allowance for loan losses is established. Loans for which it is probable that payment of interest and principal will not be made in accordance with the contractual terms of the loan agreement are considered impaired. The fair value of impaired loans is estimated using one of several methods, including collateral value, market value of similar debt, enterprise and liquidation value and discounted cash flows. Those impaired loans not requiring an allowance represent loans for which the fair value of the expected repayments or collateral exceed the recorded investments in such loans. When the fair value of the collateral is based on an observable market price or a current appraised value which uses substantially observable data, the Company records the impaired loan as nonrecurring Level 2. When an appraised value is not available or management determines the fair value of the collateral is further impaired below the appraised value or the appraised value contains a significant assumption and there is no observable market price, the Company records the impaired loan as nonrecurring Level 3. The Company records OREO at fair value on a non-recurring basis based on the collateral value of the property. When the fair value of the collateral is based on an observable market price or a current appraised value which uses substantially observable data, the Company records the OREO as non-recurring Level 2. When an appraised value is not available or management determines the fair value of the collateral is further impaired below the appraised value or the appraised value contains a significant assumption, and there is no observable market price, the Company records the impaired loan as non-recurring Level 3. Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available. Management also incorporates assumptions regarding market trends or other relevant factors and selling and commission costs ranging from 5% to 7%. Such adjustments and assumptions are typically significant and result in a Level 3 classification of the inputs for determining fair value. The carrying amounts and fair values of the Company's financial instruments at the dates indicated are presented below: Carrying Fair Fair value measurements June 30, 2019 amount value Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 351, 594 $ 351,594 $ 351,594 $ — $ — Interest bearing deposits in banks 3,232 3,232 3,232 — — Investment securities available-for-sale 100,271 100,271 996 99,275 — Loans held for sale 1,016 1,016 — 1,016 — Loans, net 1,213,527 1,213,527 — — 1,213,527 Other equity securities 11,343 11,343 11,343 — — Accrued interest receivable 4,228 4,228 — 4,228 — Financial liabilities: Deposits 1,505,382 1,505,382 — 1,505,382 — Subordinated debentures 8,201 8,201 — — 8,201 Accrued interest payable 1,453 1,453 — 1,453 — Off-balance sheet liabilities: Undisbursed loan commitments, lines of credit, standby letters of credit 121,438 121,063 — — 121,063 Carrying Fair Fair value measurements December 31, 2018 amount value Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 323,581 $ 323,581 $ 323,581 $ — $ — Interest bearing deposits in banks 3,980 3,980 3,980 — — Investment securities available-for-sale 99,796 99,796 985 98,811 — Loans held for sale 855 855 — 855 — Loans, net 970,189 967,882 — — 967,882 Other equity securities 9,243 9,243 9,243 — — Accrued interest receivable 3,676 3,676 — 3,676 — Financial liabilities: Deposits 1,257,768 1,259,045 — 1,259,045 — Subordinated debentures 8,161 6,824 — — 6,824 Accrued interest payable 198 198 — 198 — Off-balance sheet liabilities: Undisbursed loan commitments, lines of credit, standby letters of credit 101,076 100,746 — — 100,746 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2019 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | NOTE 15 – COMMITMENTS AND CONTINGENCIES Lending and Letter of Credit Commitments In the normal course of business, the Company enters into various commitments to extend credit which are not reflected in the financial statements. These commitments consist of the undisbursed balance on personal, commercial lines, including commercial real estate secured lines of credit, and of undisbursed funds on construction and development loans. At June 30, 2019 and December 31, 2018, undisbursed commitments totaled $120.7 million and $99.2 million, respectively. In addition, at June 30, 2019 and December 31, 2018, the Company has issued standby letter of credit commitments, primarily issued for the third party performance obligations of clients totaling $769,000 and $1.8 million, respectively. There were no outstanding balances at June 30, 2019 and December 31, 2018. Commitments generally have fixed expiration dates or other termination clauses. The actual liquidity needs or the credit risk that the Company will experience will be lower than the contractual amount of commitments to extend credit because a significant portion of these commitments are expected to expire without being drawn upon. The commitments are generally variable rate and include unfunded home equity lines of credit, commercial real estate construction where disbursement is made over the course of construction, commercial revolving lines of credit, and unsecured personal lines of credit. The Company’s outstanding loan commitments are made using the same underwriting standards as comparable outstanding loans. As of June 30, 2019 and December 31, 2018, the reserve associated with these commitments included in interest payable and other liabilities on the consolidated balance sheets was $375,000 and $330,000, respectively. Commercial Real Estate Concentrations At June 30, 2019 and December 31, 2018, in management’s judgment, a concentration of loans existed in commercial real estate related loans. The Company’s commercial real estate loans are secured by owner-occupied and non-owner occupied commercial real estate and multi-family properties. Although management believes that loans within these concentrations have no more than the normal risk of collectability, a decline in the performance of the economy in general or a decline in real estate value in the Company’s primary market areas in particular, could have an adverse impact on collectability. Other Assets The Company has commitments to fund Low Income Housing Tax Credit Partnerships (“LIHTC”) and a Small Business Investment Company (“SBIC”). At June 30, 2019 and December 31, 2018, the remaining commitments to the LIHTC and SBIC were approximately $3.6 million and $473,000, respectively and $3.8 million and $976,000, respectively. Deposits At June 30, 2019, approximately $129.8 million, or 8.6%, of the Company's deposits were derived from its top ten depositors. At December 31, 2018, approximately $148.6 million, or 11.5%, of the Company's deposits were derived from its top ten depositors. Local Agency Deposits In the normal course of business, the Company accepts deposits from local agencies. The Company is required to provide collateral for certain local agency deposits in the states of California, New Mexico and Washington. As of June 30, 2019 and December 31, 2018, the FHLB issued letters of credit on behalf of the Company totaling $1.0 million and $11.5 million, as collateral for local agency deposits, respectively. |
BASIS OF PRESENTATION (Policies
BASIS OF PRESENTATION (Policies) | 6 Months Ended |
Jun. 30, 2019 | |
BASIS OF PRESENTATION | |
Revenue Recognition | Revenue Recognition In accordance with Topic 606, revenues are recognized when control of promised goods or services is transferred to customers in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of Topic 606, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of Topic 606, the Company assesses the goods or services that are promised within each contract and identifies those that contain performance obligations; and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. All of the Company’s revenue from contracts with customers in scope of ASC 606 is recognized in noninterest income and included in our commercial and consumer banking segment. For the three and six months ended June 30, 2019, the Company recognized $102,000 and $189,000 in deposit fees, and $43,000 and $85,000 in debit card interchange fees considered in scope of ASC 606, respectively. There was a total of $2.4 million and $4.4 million of noninterest income considered not in scope of ASC 606 for the three and six months ended June 30, 2019. On April 5, 2012, the JOBS Act was signed into law. The JOBS Act contains provisions that, among other things, reduce certain reporting requirements for qualifying public companies. As an “emerging growth company” we may delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies. We intend to take advantage of the benefits of this extended transition period. Accordingly, our condensed consolidated financial statements may not be comparable to companies that comply with such new or revised accounting standards. |
ACQUISITION (Tables)
ACQUISITION (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Schedule of fair value of the assets acquired and liabilities assumed | The following table summarizes the fair value of the assets acquired and liabilities assumed at the acquisition date: Uniti Merger BFC Merger dated dated May 24, 2019 November 30, 2018 Fair value of assets: Cash and due from banks $ 6,392 $ 4,932 Federal funds sold 22,080 9,346 Total cash and cash equivalents 28,472 14,278 Investment securities available-for-sale 5,096 56,198 FHLB stock, at par 1,535 154 FRB stock, at par — 173 Loans, net 276,719 75,384 Premises and equipment, net 463 3,291 OREO 76 1,066 Core deposit intangible 566 3,604 Cash surrender value of bank owned life insurance policies, net — 2,937 Servicing assets 1,824 — Interest receivable and other assets 3,267 735 Total assets acquired 318,018 157,820 Liabilities: Deposits Noninterest bearing 143,082 97,771 Interest bearing 122,704 37,711 265,786 135,482 Junior subordinated deferrable interest debentures, net — 2,715 Other liabilities 1,386 329 Total liabilities assumed 267,172 138,526 Cash consideration 37,814 23,523 Common stock issued 24,887 — Goodwill $ 11,855 $ 4,229 |
Schedule of net assets acquired and the estimated fair value adjustments, which resulted in goodwill at the acquisition date | The following table presents the net assets acquired and the estimated fair value adjustments, which resulted in goodwill at the acquisition date: Uniti Merger BFC Merger dated dated May 24, 2019 November 30, 2018 Book value of net assets acquired $ 47,445 $ 16,201 Fair value adjustments: Investments available-for-sale — (382) Loans, net 4,617 284 Premises and equipment, net — 668 Write-down on OREO (32) (229) Core deposit intangible 566 3,604 Deferred tax assets (695) (1,176) Write-down on servicing assets (805) — Time deposits (250) (54) Junior subordinated deferrable interest debentures, net — 378 Total purchase accounting adjustments 3,401 3,093 Fair value of net assets acquired 50,846 19,294 Price paid: Cash paid 37,814 23,523 Common stock issued 24,887 — Total price paid 62,701 23,523 Goodwill $ 11,855 $ 4,229 |
Schedule of unaudited proforma net interest income, net income and earnings per share | The unaudited pro forma information in the following table is intended for informational purposes only and is not necessarily indicative of future operating results or operating results that would have occurred had the merger with TIG had been completed at the beginning of each respective year. No assumptions have been applied to the pro forma results of operation regarding possible revenue enhancements, expense efficiencies or asset dispositions. Three months ended Six months ended June 30, June 30, 2019 2018 2019 2018 Net interest income $ 18,405 $ 15,014 $ 35,813 $ 29,631 Net income 2,780 4,884 8,344 9,307 Basic earnings per share $ 0.23 $ 0.47 $ 0.69 $ 0.99 Diluted earnings per share $ 0.23 $ 0.47 $ 0.69 $ 0.99 |
Schedule of Acquisition Related Expenses | Acquisition expenses are recognized in the periods in which the costs are incurred and the services are received. The Company incurred third-party acquisition expenses in the consolidated statements of income for the periods indicated as follows: Uniti Merger BFC Merger Six months ended Year ended June 30, 2019 December 31, 2018 Professional fees $ 535 $ 130 Data processing 2,657 1,290 Severance expense 578 536 Other 365 369 Total $ 4,135 $ 2,325 |
Pro Forma [Member] | |
Schedule of unaudited proforma net interest income, net income and earnings per share | Unaudited pro forma net interest income, net income and earnings per share are presented below: Three months ended June 30, Six months ended June 30, 2019 2018 2019 2018 Net interest income $ 17,735 $ 17,680 $ 34,148 $ 33,302 Net income 1,118 5,612 6,632 10,551 Basic earnings per share $ 0.09 $ 0.53 $ 0.55 $ 1.10 Diluted earnings per share $ 0.09 $ 0.53 $ 0.55 $ 1.10 |
INVESTMENT SECURITIES (Tables)
INVESTMENT SECURITIES (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
INVESTMENT SECURITIES | |
Schedule of amortized cost and estimated fair values of securities available-for-sale | The amortized cost, gross unrealized gains and losses, and estimated fair values of securities available-for-sale at the dates indicated are summarized as follows: Gross Gross Amortized unrealized unrealized Estimated June 30, 2019 cost gains losses fair value U.S. Treasuries $ 993 $ 3 $ — $ 996 U.S. Government Agencies 13,512 89 (14) 13,587 Municipal securities 17,153 326 (15) 17,464 Mortgage-backed securities 28,802 852 (8) 29,646 Collateralized mortgage obligations 23,685 492 (11) 24,166 SBA securities 4,280 9 (48) 4,241 Corporate bonds 10,040 135 (4) 10,171 Total $ 98,465 $ 1,906 $ (100) $ 100,271 Gross Gross Amortized unrealized unrealized Estimated December 31, 2018 cost gains losses fair value U.S. Treasuries $ 984 $ 1 $ — $ 985 U.S. Government Agencies 13,761 21 (17) 13,765 Municipal securities 19,604 65 (166) 19,503 Mortgage-backed securities 49,565 243 (206) 49,602 Collateralized mortgage obligations 4,705 32 (20) 4,717 SBA securities 4,300 2 (61) 4,241 Corporate bonds 7,016 4 (37) 6,983 Total $ 99,935 $ 368 $ (507) $ 99,796 |
Schedule of available-for-sale securities, continuous unrealized loss position, fair value | The estimated fair value and gross unrealized losses for securities available-for-sale aggregated by the length of time that individual securities have been in a continuous unrealized loss position at the dates indicated are as follows: Less than 12 months 12 months or more Total Estimated Unrealized Estimated Unrealized Estimated Unrealized June 30, 2019 fair value loss fair value loss fair value loss U.S. Treasuries $ — $ — $ — $ — $ — $ — U.S. Government Agencies 1,509 (14) — — 1,509 (14) Municipal securities 529 (4) 1,872 (11) 2,401 (15) Mortgage-backed securities 721 (5) 1,313 (3) 2,034 (8) Collateralized mortgage obligations 926 (10) 322 (1) 1,248 (11) SBA securities — — 2,489 (48) 2,489 (48) Corporate bonds 1,518 (4) — — 1,518 (4) Total $ 5,203 $ (37) $ 5,996 $ (63) $ 11,199 $ (100) Less than 12 months 12 months or more Total Estimated Unrealized Estimated Unrealized Estimated Unrealized December 31, 2018 fair value loss fair value loss fair value loss U.S. Treasuries $ — $ — $ — $ — $ — $ — U.S. Government Agencies 4,014 (9) 1,743 (8) 5,757 (17) Municipal securities 6,883 (35) 7,537 (131) 14,420 (166) Mortgage-backed securities 14,919 (91) 6,054 (115) 20,973 (206) Collateralized mortgage obligations 2,427 (9) 477 (11) 2,904 (20) SBA securities 677 (32) 2,336 (29) 3,013 (61) Corporate bonds 4,975 (37) — — 4,975 (37) Total $ 33,895 $ (213) $ 18,147 $ (294) $ 52,042 $ (507) |
Schedule of investments classified by contractual maturity date | The amortized cost and estimated fair value of securities available-for-sale at the dates indicated by contractual maturity are shown below. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. June 30, 2019 December 31, 2018 Amortized Estimated Amortized Estimated cost fair value cost fair value Available-for-sale: Due in one year or less $ 12,031 $ 12,057 $ 14,292 $ 14,279 Due after one through five years 28,978 29,439 26,287 26,327 Due after five years through ten years 20,258 20,720 20,840 20,758 Due after ten years 37,198 38,055 38,516 38,432 Total $ 98,465 $ 100,271 $ 99,935 $ 99,796 |
LOANS (Tables)
LOANS (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
LOANS | |
Schedule of accounts, notes, loans and financing receivable | The Company’s loan portfolio at the dates indicated is summarized below: June 30, December 31, 2019 2018 Commercial and industrial $ 151,862 $ 121,855 Construction and land 30,502 47,302 Commercial real estate 902,896 701,983 Residential 128,590 102,708 Consumer 6,052 1,847 Total loans 1,219,902 975,695 Net deferred loan fees (495) (366) Allowance for loan losses (5,880) (5,140) Net loans $ 1,213,527 $ 970,189 |
Schedule of impaired financing receivables | The Company’s total impaired loans, including nonaccrual loans, accruing loans modified as troubled debt restructurings (“TDRs”), and accreting purchase credit impaired (“PCI”) loans that have experienced post-acquisition declines in cash flows expected to be collected are summarized as follows: Commercial and Construction Commercial industrial and land real estate Residential Consumer Total June 30, 2019 Recorded investment in impaired loans: With no specific allowance recorded $ 2,231 $ — $ 2,215 $ 120 $ — $ 4,566 With a specific allowance recorded 19 — — — — 19 Total recorded investment in impaired loans $ 2,250 $ — $ 2,215 $ 120 $ — $ 4,585 Specific allowance on impaired loans 19 — — — — 19 December 31, 2018 Recorded investment in impaired loans: With no specific allowance recorded $ 1,868 $ — $ 1,346 $ 654 $ — $ 3,868 With a specific allowance recorded 10 — — — — 10 Total recorded investment in impaired loans $ 1,878 $ — $ 1,346 $ 654 $ — $ 3,878 Specific allowance on impaired loans 10 — — — — 10 Three months ended June 30, 2019 Average recorded investment in impaired loans $ 2,326 $ — $ 1,386 $ 282 $ — $ 3,994 Interest recognized 1 — — — — 1 Six months ended June 30, 2019 Average recorded investment in impaired loans 2,347 — 1,162 441 — 3,950 Interest recognized 34 — 20 1 — 55 Three months ended June 30, 2018 Average recorded investment in impaired loans 702 — 890 132 — 1,724 Interest recognized — — 6 — — 6 Six months ended June 30, 2018 Average recorded investment in impaired loans 102 — 1,002 74 — 1,178 Interest recognized 10 — 11 2 — 23 |
Schedule of financing receivables, non accrual status | The following table presents nonaccrual loans at the dates indicated: June 30, December 31, 2019 2018 Commercial and industrial $ 2,250 $ 1,878 Construction and land — — Commercial real estate 1,452 596 Residential 120 654 Consumer — — Total $ 3,822 $ 3,128 |
Schedule of debtor troubled debt restructuring, current period | The following tables present TDR loans by class, during the periods indicated: Number of Rate Term Interest only Combined Three months ended June 30, 2019 loans modification modification modification modification Total Commercial and industrial — $ — $ — $ — $ — $ — Construction and land — — — — — — Commercial real estate — — — — — — Residential — — — — — — Consumer — — — — — — Total — $ — $ — $ — $ — $ — Number of Rate Term Interest only Combined Six months ended June 30, 2019 loans modification modification modification modification Total Commercial and industrial 2 $ — $ 176 $ — $ 321 $ 497 Construction and land — — — — — — Commercial real estate — — — — — — Residential — — — — — — Consumer — — — — — — Total 2 $ — $ 176 $ — $ 321 $ 497 Number of Rate Term Interest only Combined Three months ended June 30, 2018 loans modification modification modification modification Total Commercial and industrial — $ — $ — $ — $ — $ — Construction and land — — — — — — Commercial real estate — — — — — — Residential 1 — 129 — — 129 Consumer — — — — — — Total 1 $ — $ 129 $ — $ — $ 129 Number of Rate Term Interest only Combined Six months ended June 30, 2018 loans modification modification modification modification Total Commercial and industrial 1 $ — $ — $ — $ 11 $ 11 Construction and land — — — — — — Commercial real estate 1 — — — 776 776 Residential 1 — 129 — — 129 Consumer — — — — — — Total 3 $ — $ 129 $ — $ 787 $ 916 |
Schedule of financing receivable credit quality indicators | The following tables present the internally assigned risk grade by class of loans at the dates indicated: June 30, 2019 Pass mention Substandard Doubtful Total Commercial and industrial $ 149,943 $ 1,253 $ 666 $ — $ 151,862 Construction and land 27,618 147 2,737 — 30,502 Commercial real estate 882,714 16,038 4,144 — 902,896 Residential 127,239 1,231 120 — 128,590 Consumer 6,041 11 — — 6,052 Total $ 1,193,555 $ 18,680 $ 7,667 $ — $ 1,219,902 Special December 31, 2018 Pass mention Substandard Doubtful Total Commercial and industrial $ 119,926 $ 1,302 $ 627 $ — $ 121,855 Construction and land 44,490 — 2,812 — 47,302 Commercial real estate 686,154 12,120 3,709 — 701,983 Residential 101,908 147 653 — 102,708 Consumer 1,847 — — — 1,847 Total $ 954,325 $ 13,569 $ 7,801 $ — $ 975,695 |
Schedule of past due financing receivables | The following tables provide an aging of the Company’s loans receivable as of the dates indicated: Recorded 90 Days investment > 30-59 Days 60-89 Days or more Total Total loans 90 days and June 30, 2019 past due past due past due past due Current PCI loans receivable accruing Commercial and industrial $ 579 $ 359 $ 1,763 $ 2,701 $ 148,385 $ 776 $ 151,862 $ — Construction and land 93 — — 93 30,189 220 30,502 — Commercial real estate 306 3,916 1,960 6,182 880,865 15,849 902,896 597 Residential — 39 — 39 126,795 1,756 128,590 — Consumer — 5 — 5 6,047 — 6,052 — Total $ 978 $ 4,319 $ 3,723 $ 9,020 $ 1,192,281 $ 18,601 $ 1,219,902 $ 597 Recorded 90 Days investment > 30-59 Days 60-89 Days or more Total Total loans 90 days and December 31, 2018 past due past due past due past due Current PCI loans receivable accruing Commercial and industrial $ 270 $ 349 $ 1,861 $ 2,480 $ 119,373 $ 2 $ 121,855 $ — Construction and land — — — — 47,069 233 47,302 — Commercial real estate 2,345 356 501 3,202 688,005 10,776 701,983 — Residential 93 — 57 150 100,765 1,793 102,708 — Consumer — 4 — 4 1,843 — 1,847 — Total $ 2,708 $ 709 $ 2,419 $ 5,836 $ 957,055 $ 12,804 $ 975,695 $ — |
Schedule of purchase credit impaired loans | The unpaid principal balance and carrying value of the Company’s PCI loans at the dates indicated are as follows: June 30, 2019 December 31, 2018 Unpaid Unpaid principal Carrying principal Carrying balance value balance value Commercial and industrial $ 1,462 $ 776 $ 125 $ 2 Construction and land 319 220 335 233 Commercial real estate 18,568 15,849 12,605 10,776 Residential 2,340 1,756 2,381 1,793 Consumer — — — — Total $ 22,689 $ 18,601 $ 15,446 $ 12,804 The following table summarized the accretable yield on the purchased credit impaired loans for the periods indicated: Three months ended Six months ended June 30, June 30, 2019 2018 2019 2018 Balance at beginning of period $ 231 $ 353 $ 256 $ 372 Additions 350 — 350 — Accretion (24) (78) (46) (97) Payoffs — — (3) — Balance at end of period $ 557 $ 275 $ 557 $ 275 |
ALLOWANCE FOR LOAN LOSSES (Tabl
ALLOWANCE FOR LOAN LOSSES (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
ALLOWANCE FOR LOAN LOSSES | |
Schedule of AllolwanceSchedule of Allowance for loan losses for loan losses | The following tables summarize the Company’s allowance for loan losses individually and collectively evaluated for impairment by loan product as of or for the periods ending as indicated: Commercial Construction Commercial Three months ended June 30, 2019 and industrial and land real estate Residential Consumer Unallocated Total Allowance for loan losses Beginning balance $ 1,135 $ 340 $ 3,326 $ 235 $ 2 $ 367 $ 5,405 Charge-offs — — — — — — — Recoveries 30 — — — — — 30 Provision for loan losses 85 (74) 527 (10) — (83) 445 Ending balance $ 1,250 $ 266 $ 3,853 $ 225 $ 2 $ 284 $ 5,880 Commercial Construction Commercial Six months ended June 30, 2019 and industrial and land real estate Residential Consumer Unallocated Total Allowance for loan losses Beginning balance $ 1,017 $ 327 $ 3,214 $ 215 $ 3 $ 364 $ 5,140 Charge-offs — — (17) — (4) — (21) Recoveries 39 — — — — — 39 Provision for loan losses 194 (61) 656 10 3 (80) 722 Ending balance $ 1,250 $ 266 $ 3,853 $ 225 $ 2 $ 284 $ 5,880 June 30, 2019 Allowance for loan losses related to: Loans individually evaluated for impairment $ 19 $ — $ — $ — $ — $ — $ 19 Loans collectively evaluated for impairment 1,233 266 3,490 587 1 284 5,861 PCI loans — — — — — — — Commercial Construction Commercial Three months ended June 30, 2018 and industrial and land real estate Residential Consumer Unallocated Total Allowance for loan losses Beginning balance $ 1,005 $ 251 $ 2,782 $ 160 $ — $ 402 $ 4,600 Charge-offs (251) — — — — — (251) Recoveries 8 — — — — — 8 Provision for loan losses 140 41 179 15 2 (134) 243 Ending balance $ 902 $ 292 $ 2,961 $ 175 $ 2 $ 268 $ 4,600 Commercial Construction Commercial Six months ended June 30, 2018 and industrial and land real estate Residential Consumer Unallocated Total Allowance for loan losses Beginning balance $ 841 $ 199 $ 2,695 $ 150 $ 3 $ 327 $ 4,215 Charge-offs (251) — — — — — (251) Recoveries 139 — — — — — 139 Provision for loan losses 173 93 266 25 (1) (59) 497 Ending balance $ 902 $ 292 $ 2,961 $ 175 $ 2 $ 268 $ 4,600 June 30, 2018 Allowance for loan losses related to: Loans individually evaluated for impairment $ 11 $ — $ — $ — $ — $ — $ 11 Loans collectively evaluated for impairment 891 292 2,961 175 2 268 4,589 PCI loans — — — — — — — |
PREMISES AND EQUIPMENT (Tables)
PREMISES AND EQUIPMENT (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
PREMISES AND EQUIPMENT | |
Schedule of Premises and Equipment | Premises and equipment consisted of the following at the dates indicated: June 30, December 31, 2019 2018 Premises owned $ 4,571 $ 10,267 Write-down on premises owned — (600) Premises owned, net 4,571 9,667 Leasehold improvements 2,178 1,654 Furniture, fixtures and equipment 4,016 3,835 Less accumulated depreciation and amortization (4,184) (3,988) Total premises and equipment, net $ 6,581 $ 11,168 |
Schedule of Lease payments | The periods prior to the date of adoption are accounted for under Lease Topic 840; therefore, the following disclosures of future minimum lease payments as of June 30, 2019, include only the periods for which Topic 842 was effective: Year ending December 31, $ 1,465 2,759 2,431 1,801 1,299 Thereafter 1,906 Total lease payments 11,661 Less: interest (863) Present value of lease liabilities $ 10,798 |
Schedule of Weighted average operating lease term and discount rate | The following table presents the weighted average operating lease term and discount rate at the date indicated: June 30, 2019 Weighted-average remaining lease term 5.06 years Weighted-average discount rate 2.89 % |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
GOODWILL AND INTANGIBLE ASSETS | |
Schedule of company's goodwill | Changes in the Company’s goodwill for the periods indicated are as follows: June 30, December 31, 2019 2018 Balance, January 1 $ 14,594 $ 10,365 Acquired goodwill 11,855 4,229 Impairment — — Balance at end of period $ 26,449 $ 14,594 |
Schedule of finite-lived intangible assets | Changes in the Company’s core deposit intangible for the periods indicated were as follows: June 30, December 31, 2019 2018 Balance, January 1 $ 7,205 $ 4,772 Additions 566 3,604 Less amortization (781) (1,171) Balance at end of period $ 6,990 $ 7,205 |
Schedule of finite-lived intangible assets, future amortization expense | Estimated annual amortization at June 30, 2019 is as follows: Year ending December 31, $ 778 1,441 1,418 1,418 642 Thereafter 1,293 Total $ 6,990 |
INTEREST RECEIVABLE AND OTHER_2
INTEREST RECEIVABLE AND OTHER ASSETS (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
INTEREST RECEIVABLE AND OTHER ASSETS | |
Schedule of Interest receivable and other assets | The Company’s interest receivable and other assets at the dates indicated consisted of the following: June 30, December 31, 2019 2018 Deferred tax assets, net $ 7,295 $ 5,891 Accrued interest receivable 4,228 3,676 Investment in SBIC Fund 2,113 1,347 Prepaid assets 1,322 2,156 Servicing asset 2,446 814 Low income housing partnership, net 705 607 Investment in statutory trusts 395 395 All other 1,077 2,495 Total $ 19,581 $ 17,381 |
DEPOSITS (Tables)
DEPOSITS (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
DEPOSITS | |
Schedule of Deposits | The Company’s deposits consisted of the following at the dates indicated: June 30, December 31, 2019 2018 Demand deposits $ 538,504 $ 398,045 NOW accounts and savings 248,029 246,288 Money market 385,934 398,081 Time under $250,000 189,842 117,653 Time $250,000 and over 143,073 97,701 Total $ 1,505,382 $ 1,257,768 |
INTEREST PAYABLE AND OTHER LI_2
INTEREST PAYABLE AND OTHER LIABILITIES (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
INTEREST PAYABLE AND OTHER LIABILITIES | |
Schedule of interest payable and other liabilities | The Company’s interest payable and other liabilities at the dates indicated consisted of the following: June 30, December 31, 2019 2018 Accrued expenses $ 5,448 $ 5,508 Deferred rents — 528 CDARs deferred fees 434 494 Accounts payable 1,044 811 Reserve for unfunded commitments 375 330 Accrued interest payable 1,453 198 Miscellaneous other liabilities 484 506 Total $ 9,238 $ 8,375 |
OTHER EXPENSES (Tables)
OTHER EXPENSES (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
OTHER EXPENSES | |
Schedule of other expenses | The Company’s other expenses at the dates indicated consisted of the following: Three months ended Six months ended June 30, June 30, 2019 2018 2019 2018 Professional fees $ 867 $ 557 $ 1,264 $ 898 Core deposit premium amortization 392 290 781 578 Marketing and promotions 396 248 606 459 Stationary and supplies 161 91 298 215 Insurance (including FDIC premiums) 159 107 315 265 Communication and postage 112 109 207 222 Loan default related expense 119 3 150 44 Director fees 375 72 496 131 Bank service charges 19 18 31 47 Courier expense 117 110 231 227 Write-down on premises — 600 — 600 Other expenses 133 21 222 66 Total $ 2,850 $ 2,226 $ 4,601 $ 3,752 |
EQUITY INCENTIVE PLANS (Tables)
EQUITY INCENTIVE PLANS (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
EQUITY INCENTIVE PLANS | |
Schedule of nonvested restricted stock units activity | The following table provides the restricted stock grant activity for the periods indicated: 2019 2018 Weighted-average Weighted-average grant date grant date Shares fair value Shares fair value Non-vested at January 1, 131,000 $ 19.18 67,481 $ 13.51 Granted 22,289 22.38 15,232 19.45 Vested (19,253) 19.51 (8,706) 13.40 Non-vested at March 31, 134,036 20.76 74,007 14.60 Granted 45,696 24.60 78,148 22.00 Vested (36,582) 19.55 — — Non-vested at June 30, 143,150 21.63 152,155 19.05 |
FAIR VALUE MEASUREMENT (Tables)
FAIR VALUE MEASUREMENT (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
FAIR VALUE MEASUREMENT | |
Schedule of fair value, assets measured on recurring basis | The following assets are measured at fair value on a recurring basis at the dates indicated: June 30, 2019 Total Level 1 Level 2 Level 3 U.S. Treasuries $ 996 $ 996 $ — $ — U.S. Government Agencies 13,587 — 13,587 — Municipal securities 17,464 — 17,464 — Mortgage-backed securities 29,646 — 29,646 — Collateralized mortgage obligations 24,166 — 24,166 — SBA securities 4,241 — 4,241 — Corporate bonds 10,171 — 10,171 — Total assets measured at fair value $ 100,271 $ 996 $ 99,275 $ — December 31, 2018 Total Level 1 Level 2 Level 3 U.S. Treasuries $ 985 $ 985 $ — $ — U.S. Government Agencies 13,765 — 13,765 — Municipal securities 19,503 — 19,503 — Mortgage-backed securities 49,602 — 49,602 — Collateralized mortgage obligations 6,983 — 6,983 — SBA securities 4,241 — 4,241 — Corporate bonds 4,717 — 4,717 — Total assets measured at fair value $ 99,796 $ 985 $ 98,811 $ — |
Schedule of fair value measurements, nonrecurring | The following assets are measured at fair value on a nonrecurring basis as of the dates indicated: June 30, 2019 Total Level 1 Level 2 Level 3 Performing impaired loans $ 763 $ — $ — $ 763 Nonperforming impaired loans 3,822 — — 3,822 OREO 627 — — 627 Total assets measured at fair value $ 5,212 $ — $ — $ 5,212 December 31, 2018 Total Level 1 Level 2 Level 3 Performing impaired loans $ 750 $ — $ — $ 750 Nonperforming impaired loans 3,128 — — 3,128 OREO 801 — — 801 Total assets measured at fair value $ 4,679 $ — $ — $ 4,679 |
Schedule of estimated fair value of financial instruments | The carrying amounts and fair values of the Company's financial instruments at the dates indicated are presented below: Carrying Fair Fair value measurements June 30, 2019 amount value Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 351, 594 $ 351,594 $ 351,594 $ — $ — Interest bearing deposits in banks 3,232 3,232 3,232 — — Investment securities available-for-sale 100,271 100,271 996 99,275 — Loans held for sale 1,016 1,016 — 1,016 — Loans, net 1,213,527 1,213,527 — — 1,213,527 Other equity securities 11,343 11,343 11,343 — — Accrued interest receivable 4,228 4,228 — 4,228 — Financial liabilities: Deposits 1,505,382 1,505,382 — 1,505,382 — Subordinated debentures 8,201 8,201 — — 8,201 Accrued interest payable 1,453 1,453 — 1,453 — Off-balance sheet liabilities: Undisbursed loan commitments, lines of credit, standby letters of credit 121,438 121,063 — — 121,063 Carrying Fair Fair value measurements December 31, 2018 amount value Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 323,581 $ 323,581 $ 323,581 $ — $ — Interest bearing deposits in banks 3,980 3,980 3,980 — — Investment securities available-for-sale 99,796 99,796 985 98,811 — Loans held for sale 855 855 — 855 — Loans, net 970,189 967,882 — — 967,882 Other equity securities 9,243 9,243 9,243 — — Accrued interest receivable 3,676 3,676 — 3,676 — Financial liabilities: Deposits 1,257,768 1,259,045 — 1,259,045 — Subordinated debentures 8,161 6,824 — — 6,824 Accrued interest payable 198 198 — 198 — Off-balance sheet liabilities: Undisbursed loan commitments, lines of credit, standby letters of credit 101,076 100,746 — — 100,746 |
BASIS OF PRESENTATION (Details)
BASIS OF PRESENTATION (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2019 | Jun. 28, 2019 | Jan. 01, 2019 | |
Operating Lease, Right-of-Use Asset | $ 10,598,000 | $ 10,598,000 | $ 7,800,000 | |
Operating Lease, Liability | 10,798,000 | 10,798,000 | $ 8,200,000 | |
Proceeds from Deposits from Customers | 102,000 | 189,000 | ||
New Revenue Recognition Accounting Standard | 2,400,000 | 4,400,000 | ||
TIG Bancorp [Member] | ||||
Business Acquisition, Transaction Costs | $ 39,400,000 | |||
Debit Card [Member] | ||||
Debit Card Interchange Fees | $ 43,000 | $ 85,000 |
ACQUISITION - Fair value of ass
ACQUISITION - Fair value of assets and liabilities (Details) - USD ($) $ in Thousands | May 24, 2019 | Nov. 30, 2018 | Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Fair value of assets: | |||||
Cash and due from banks | $ 27,587 | $ 20,846 | |||
Federal funds sold | 324,007 | 302,735 | |||
Total cash and cash equivalents | 351,594 | 323,581 | |||
FHLB stock, at par | 7,174 | 5,162 | |||
FRB stock, at par | 4,169 | 4,081 | |||
Loans, net | 1,213,527 | 967,882 | |||
OREO | 627 | 801 | |||
Core deposit intangible | 6,990 | 7,205 | |||
Cash surrender value of bank owned life insurance policies, net | 19,918 | 19,602 | |||
Servicing assets | 2,446 | 814 | |||
Interest receivable and other assets | 19,581 | 17,381 | |||
Total Assets | 1,771,727 | 1,478,395 | |||
Deposits | |||||
Noninterest bearing | 1,505,382 | 1,257,768 | |||
Deposits | 1,505,382 | 1,259,045 | |||
Total liabilities | 1,537,090 | 1,277,642 | |||
Net cash paid in acquisition | 9,342 | ||||
Goodwill | $ 26,449 | $ 14,594 | $ 10,365 | ||
Uniti Merger [Member] | |||||
Fair value of assets: | |||||
Cash and due from banks | $ 6,392 | ||||
Federal funds sold | 22,080 | ||||
Total cash and cash equivalents | 28,472 | ||||
Investment securities available-for-sale | 5,096 | ||||
FHLB stock, at par | 1,535 | ||||
Loans, net | 276,719 | ||||
Premises and equipment, net | 463 | ||||
OREO | 76 | ||||
Core deposit intangible | 566 | ||||
Servicing assets | 1,824 | ||||
Interest receivable and other assets | 3,267 | ||||
Total Assets | 318,018 | ||||
Deposits | |||||
Noninterest bearing | 143,082 | ||||
Interest bearing | 122,704 | ||||
Deposits | 265,786 | ||||
Other liabilities | 1,386 | ||||
Total liabilities | 267,172 | ||||
Net cash paid in acquisition | 37,814 | ||||
Common stock issued | 24,887 | ||||
Goodwill | $ 11,855 | ||||
BFC Merger [Member] | |||||
Fair value of assets: | |||||
Cash and due from banks | $ 4,932 | ||||
Federal funds sold | 9,346 | ||||
Total cash and cash equivalents | 14,278 | ||||
Investment securities available-for-sale | 56,198 | ||||
FHLB stock, at par | 154 | ||||
FRB stock, at par | 173 | ||||
Loans, net | 75,384 | ||||
Premises and equipment, net | 3,291 | ||||
OREO | 1,066 | ||||
Core deposit intangible | 3,604 | ||||
Cash surrender value of bank owned life insurance policies, net | 2,937 | ||||
Interest receivable and other assets | 735 | ||||
Total Assets | 157,820 | ||||
Deposits | |||||
Noninterest bearing | 97,771 | ||||
Interest bearing | 37,711 | ||||
Deposits | 135,482 | ||||
Junior subordinated deferrable interest debentures, net | 2,715 | ||||
Other liabilities | 329 | ||||
Total liabilities | 138,526 | ||||
Net cash paid in acquisition | 23,523 | ||||
Goodwill | $ 4,229 |
ACQUISITION - Net Assets acquir
ACQUISITION - Net Assets acquired and Goodwill (Details) - USD ($) $ in Thousands | May 24, 2019 | Nov. 30, 2018 | Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Fair value of assets: | |||||
Net Loans | $ 1,213,527 | $ 970,189 | |||
Premises and equipment, net | 6,581 | 11,168 | |||
Core deposit intangible | 6,990 | 7,205 | |||
Junior subordinated deferrable interest debentures, net | 8,201 | 8,161 | |||
Price paid: | |||||
Net cash paid in acquisition | 9,342 | ||||
Goodwill | $ 26,449 | $ 14,594 | $ 10,365 | ||
Uniti Merger [Member] | |||||
Book value of net assets acquired | $ 47,445 | ||||
Fair value of assets: | |||||
Net Loans | 4,617 | ||||
Write-down on OREO | (32) | ||||
Core deposit intangible | 566 | ||||
Deferred tax asset, net | (695) | ||||
Write-down on servicing assets | (805) | ||||
Time deposits | (250) | ||||
Total purchase accounting adjustments | 3,401 | ||||
Fair value of net assets acquired | 50,846 | ||||
Price paid: | |||||
Net cash paid in acquisition | 37,814 | ||||
Common stock issued | 24,887 | ||||
Total price paid | 62,701 | ||||
Goodwill | $ 11,855 | ||||
BFC Merger [Member] | |||||
Book value of net assets acquired | $ 16,201 | ||||
Fair value of assets: | |||||
Investments available-for-sale | (382) | ||||
Net Loans | 284 | ||||
Premises and equipment, net | 668 | ||||
Write-down on OREO | (229) | ||||
Core deposit intangible | 3,604 | ||||
Deferred tax asset, net | (1,176) | ||||
Time deposits | (54) | ||||
Junior subordinated deferrable interest debentures, net | 378 | ||||
Total purchase accounting adjustments | 3,093 | ||||
Fair value of net assets acquired | 19,294 | ||||
Price paid: | |||||
Net cash paid in acquisition | 23,523 | ||||
Total price paid | 23,523 | ||||
Goodwill | $ 4,229 |
ACQUISITION - Unaudited proform
ACQUISITION - Unaudited proforma results (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 | Mar. 31, 2018 | Jun. 30, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | |
Net interest income | $ 16,018 | $ 12,600 | $ 30,883 | $ 25,014 | |||
Net income | $ 2,227 | $ 4,941 | $ 4,288 | $ 4,069 | $ 7,168 | $ 6,136 | $ 8,357 |
Basic earnings per share | $ 0.20 | $ 0.45 | $ 0.64 | $ 0.99 | |||
Pro Forma [Member] | |||||||
Net interest income | $ 17,735 | $ 17,680 | $ 34,148 | $ 33,302 | |||
Net income | $ 1,118 | $ 5,612 | $ 6,632 | $ 10,551 | |||
Basic earnings per share | $ 0.09 | $ 0.53 | $ 0.55 | $ 1.10 | |||
Diluted earnings per share | $ 0.09 | $ 0.53 | $ 0.55 | $ 1.10 |
ACQUISITION - Acquisition Relat
ACQUISITION - Acquisition Related Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Professional fees | $ 867 | $ 557 | $ 1,264 | $ 898 | |
Data processing | $ 3,683 | $ 615 | 4,607 | $ 1,323 | |
Uniti Merger [Member] | |||||
Professional fees | 535 | ||||
Data processing | 2,657 | ||||
Severance expense | 578 | ||||
Other | 365 | ||||
Total year-to-date | $ 4,135 | ||||
BFC Merger [Member] | |||||
Professional fees | $ 130 | ||||
Data processing | 1,290 | ||||
Severance expense | 536 | ||||
Other | 369 | ||||
Total year-to-date | $ 2,325 |
ACQUISITION - Pending acquisiti
ACQUISITION - Pending acquisition (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Net interest income | $ 16,018 | $ 12,600 | $ 30,883 | $ 25,014 |
Diluted earnings per share | $ 0.20 | $ 0.45 | $ 0.64 | $ 0.99 |
Pending Acquisition [Member] | ||||
Net interest income | $ 2,780 | $ 4,884 | $ 8,344 | $ 9,307 |
Net income | $ 18,405 | $ 15,014 | $ 35,813 | $ 29,631 |
Basic earnings per share | $ 0.23 | $ 0.47 | $ 0.69 | $ 0.99 |
Diluted earnings per share | $ 0.23 | $ 0.47 | $ 0.69 | $ 0.99 |
ACQUISITION - Additional inform
ACQUISITION - Additional information (Details) $ / shares in Units, $ in Thousands | Jun. 28, 2019USD ($)item$ / shares | May 24, 2019USD ($)itemshares | Nov. 30, 2018USD ($)item$ / shares | Jun. 30, 2019USD ($) | Dec. 31, 2018USD ($) |
Payments to Acquire Businesses, Net of Cash Acquired | $ 9,342 | ||||
Assets | 1,771,727 | $ 1,478,395 | |||
Deposits | $ 1,505,382 | $ 1,257,768 | |||
Uniti Merger [Member] | |||||
Number of Branch Offices | item | 3 | ||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | shares | 1,115,006 | ||||
Business Combination, Consideration Transferred, Equity Interests Issued and Issuable | $ 24,887 | ||||
Payments to Acquire Businesses, Net of Cash Acquired | 37,814 | ||||
Business Combination, Consideration Transferred | 62,701 | ||||
Assets | $ 318,018 | ||||
BFC Merger [Member] | |||||
Number of Branch Offices | item | 5 | ||||
Payments to Acquire Businesses, Net of Cash Acquired | $ 23,523 | ||||
Business Combination, Consideration Transferred | $ 23,523 | ||||
Business Acquisition, Share Price | $ / shares | $ 62 | ||||
Assets | $ 157,820 | ||||
TIG Bancorp [Member] | |||||
Number of Branch Offices | item | 7 | ||||
Business Combination, Consideration Transferred | $ 39,400 | ||||
Business Acquisition, Share Price | $ / shares | $ 6.34 | ||||
Common Stock, Conversion Basis | 0.27543 shares of Company common stock | ||||
Common Stock, Par or Stated Value Per Share | $ / shares | $ 21.90 | ||||
Business Combination, Consideration Transferred Value Per Share | $ / shares | $ 12.37 | ||||
Business Acquisition, Percentage of Voting Interests Acquired | 6.80% | ||||
Assets | $ 230,500 | ||||
Total loans | 145,700 | ||||
Deposits | 197,000 | ||||
Business Combination Recognition In Equity | $ 32,000 |
INVESTMENT SECURITIES - Amortiz
INVESTMENT SECURITIES - Amortized Cost, Gross Unrealized Gains and Losses, and Estimated Fair Values of Securities (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Amortized cost | $ 98,465 | $ 99,935 |
Gross Unrealized gains | 1,906 | 368 |
Gross Unrealized losses | (100) | (507) |
Estimated fair value | 100,271 | 99,796 |
US Treasuries [Member] | ||
Amortized cost | 993 | 984 |
Gross Unrealized gains | 3 | 1 |
Gross Unrealized losses | 0 | 0 |
Estimated fair value | 996 | 985 |
U.S. Government Agencies [Member] | ||
Amortized cost | 13,512 | 13,761 |
Gross Unrealized gains | 89 | 21 |
Gross Unrealized losses | (14) | (17) |
Estimated fair value | 13,587 | 13,765 |
Municipal securities [Member] | ||
Amortized cost | 17,153 | 19,604 |
Gross Unrealized gains | 326 | 65 |
Gross Unrealized losses | (15) | (166) |
Estimated fair value | 17,464 | 19,503 |
Mortgage-backed securities [Member] | ||
Amortized cost | 28,802 | 49,565 |
Gross Unrealized gains | 852 | 243 |
Gross Unrealized losses | (8) | (206) |
Estimated fair value | 29,646 | 49,602 |
Collateralized mortgage obligation securities [Member] | ||
Amortized cost | 23,685 | 4,705 |
Gross Unrealized gains | 492 | 32 |
Gross Unrealized losses | (11) | (20) |
Estimated fair value | 24,166 | 4,717 |
SBA Securities [Member] | ||
Amortized cost | 4,280 | 4,300 |
Gross Unrealized gains | 9 | 2 |
Gross Unrealized losses | (48) | (61) |
Estimated fair value | 4,241 | 4,241 |
Corporate Bonds [Member] | ||
Amortized cost | 10,040 | 7,016 |
Gross Unrealized gains | 135 | 4 |
Gross Unrealized losses | (4) | (37) |
Estimated fair value | $ 10,171 | $ 6,983 |
INVESTMENT SECURITIES - Gross U
INVESTMENT SECURITIES - Gross Unrealized Losses and Estimated Fair Value for Securities Available-for-Sale (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Less than 12 months Estimated Fair Value | $ 5,203 | $ 33,895 |
Less than 12 months Unrealized Loss | (37) | (213) |
12 months or more Estimated Fair Value | 5,996 | 18,147 |
12 months or more Unrealized Loss | (63) | (294) |
Total Estimated Fair Value | 11,199 | 52,042 |
Total Unrealized Loss | (100) | (507) |
US Treasuries [Member] | ||
Less than 12 months Estimated Fair Value | 0 | 0 |
Less than 12 months Unrealized Loss | 0 | 0 |
12 months or more Estimated Fair Value | 0 | 0 |
12 months or more Unrealized Loss | 0 | 0 |
Total Estimated Fair Value | 0 | 0 |
Total Unrealized Loss | 0 | 0 |
U.S. Government Agencies [Member] | ||
Less than 12 months Estimated Fair Value | 1,509 | 4,014 |
Less than 12 months Unrealized Loss | (14) | (9) |
12 months or more Estimated Fair Value | 0 | 1,743 |
12 months or more Unrealized Loss | 0 | (8) |
Total Estimated Fair Value | 1,509 | 5,757 |
Total Unrealized Loss | (14) | (17) |
Municipal securities [Member] | ||
Less than 12 months Estimated Fair Value | 529 | 6,883 |
Less than 12 months Unrealized Loss | (4) | (35) |
12 months or more Estimated Fair Value | 1,872 | 7,537 |
12 months or more Unrealized Loss | (11) | (131) |
Total Estimated Fair Value | 2,401 | 14,420 |
Total Unrealized Loss | (15) | (166) |
Mortgage-backed securities [Member] | ||
Less than 12 months Estimated Fair Value | 721 | 14,919 |
Less than 12 months Unrealized Loss | (5) | (91) |
12 months or more Estimated Fair Value | 1,313 | 6,054 |
12 months or more Unrealized Loss | (3) | (115) |
Total Estimated Fair Value | 2,034 | 20,973 |
Total Unrealized Loss | (8) | (206) |
Collateralized mortgage obligation securities [Member] | ||
Less than 12 months Estimated Fair Value | 926 | 2,427 |
Less than 12 months Unrealized Loss | (10) | (9) |
12 months or more Estimated Fair Value | 322 | 477 |
12 months or more Unrealized Loss | (1) | (11) |
Total Estimated Fair Value | 1,248 | 2,904 |
Total Unrealized Loss | (11) | (20) |
SBA Securities [Member] | ||
Less than 12 months Estimated Fair Value | 677 | |
Less than 12 months Unrealized Loss | (32) | |
12 months or more Estimated Fair Value | 2,489 | 2,336 |
12 months or more Unrealized Loss | (48) | (29) |
Total Estimated Fair Value | 2,489 | 3,013 |
Total Unrealized Loss | (48) | (61) |
Corporate Bonds [Member] | ||
Less than 12 months Estimated Fair Value | 1,518 | 4,975 |
Less than 12 months Unrealized Loss | (4) | (37) |
12 months or more Estimated Fair Value | 0 | 0 |
12 months or more Unrealized Loss | 0 | 0 |
Total Estimated Fair Value | 1,518 | 4,975 |
Total Unrealized Loss | $ (4) | $ (37) |
INVESTMENT SECURITIES - Amort_2
INVESTMENT SECURITIES - Amortized Cost and Estimated Fair Value of Available-for-Sale Securities by Contractual Maturity (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Available-for-sale: Amortized Cost | ||
Due in one year or less | $ 12,031 | $ 14,292 |
Due after one through five years | 28,978 | 26,287 |
Due after five years through ten years | 20,258 | 20,840 |
Due after ten years | 37,198 | 38,516 |
Available-for-sale Amortized Cost | 98,465 | 99,935 |
Available-for-sale: Fair Value | ||
Due in one year or less | 12,057 | 14,279 |
Due after one through five years | 29,439 | 26,327 |
Due after five years through ten years | 20,720 | 20,758 |
Due after ten years | 38,055 | 38,432 |
Available-for-sale Fair Value | $ 100,271 | $ 99,796 |
INVESTMENT SECURITIES - Additio
INVESTMENT SECURITIES - Additional information (Details) | Jun. 30, 2019item |
INVESTMENT SECURITIES | |
Debt Securities, Available-for-sale, Unrealized Loss Position, Number of Positions | 214 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer, Number of Positions | 20 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months, Number of Positions | 22 |
LOANS - Summary of Loans (Detai
LOANS - Summary of Loans (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 |
LOANS | ||||||
Commercial and industrial | $ 151,862 | $ 121,855 | ||||
Construction and land | 30,502 | 47,302 | ||||
Commercial real estate | 902,896 | 701,983 | ||||
Residential | 128,590 | 102,708 | ||||
Total loans | 1,219,902 | 975,695 | ||||
Consumer | 6,052 | 1,847 | ||||
Net deferred loan fees | (495) | (366) | ||||
Allowance for loan losses | (5,880) | $ (5,405) | (5,140) | $ (4,600) | $ (4,600) | $ (4,215) |
Net Loans | $ 1,213,527 | $ 970,189 |
LOANS - Total Impaired Loans In
LOANS - Total Impaired Loans Including Non-Accrual Loans, Accruing TDR Loans and Accreting PCI Loans (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Total recorded investment in impaired loans | $ 4,585 | $ 4,585 | $ 3,878 | ||
Specific allowance on impaired loans | 19 | 19 | 10 | ||
Average recorded investment in impaired loans | 3,994 | $ 1,724 | 3,950 | $ 1,178 | |
Interest recognized | 1 | 6 | 55 | 23 | |
Consumer [Member] | |||||
Total recorded investment in impaired loans | 0 | 0 | 0 | ||
Specific allowance on impaired loans | 0 | 0 | 0 | ||
Average recorded investment in impaired loans | 0 | 0 | 0 | 0 | |
Interest recognized | 0 | 0 | 0 | 0 | |
Commercial real estate [Member] | |||||
Total recorded investment in impaired loans | 2,215 | 2,215 | 1,346 | ||
Specific allowance on impaired loans | 0 | 0 | 0 | ||
Average recorded investment in impaired loans | 1,386 | 890 | 1,162 | 1,002 | |
Interest recognized | 0 | 6 | 20 | 11 | |
Residential [Member] | |||||
Total recorded investment in impaired loans | 120 | 120 | 654 | ||
Specific allowance on impaired loans | 0 | 0 | 0 | ||
Average recorded investment in impaired loans | 282 | 132 | 441 | 74 | |
Interest recognized | 0 | 0 | 1 | 2 | |
Commercial and industrial [Member] | |||||
Total recorded investment in impaired loans | 2,250 | 2,250 | 1,878 | ||
Specific allowance on impaired loans | 19 | 19 | 10 | ||
Average recorded investment in impaired loans | 2,326 | 702 | 2,347 | 102 | |
Interest recognized | 1 | 34 | 10 | ||
Construction and land [Member] | |||||
Total recorded investment in impaired loans | 0 | 0 | 0 | ||
Specific allowance on impaired loans | 0 | 0 | 0 | ||
Average recorded investment in impaired loans | 0 | 0 | 0 | 0 | |
Interest recognized | 0 | $ 0 | 0 | $ 0 | |
With No Related Allowance Recorded [Member] | |||||
With no specific allowance recorded | 4,566 | 4,566 | 3,868 | ||
With No Related Allowance Recorded [Member] | Consumer [Member] | |||||
With no specific allowance recorded | 0 | 0 | 0 | ||
With No Related Allowance Recorded [Member] | Commercial real estate [Member] | |||||
With no specific allowance recorded | 2,215 | 2,215 | 1,346 | ||
With No Related Allowance Recorded [Member] | Residential [Member] | |||||
With no specific allowance recorded | 120 | 120 | 654 | ||
With No Related Allowance Recorded [Member] | Commercial and industrial [Member] | |||||
With no specific allowance recorded | 2,231 | 2,231 | 1,868 | ||
With No Related Allowance Recorded [Member] | Construction and land [Member] | |||||
With no specific allowance recorded | 0 | 0 | 0 | ||
With An Allowance Recorded [Member] | |||||
With a specific allowance recorded | 19 | 19 | 10 | ||
With An Allowance Recorded [Member] | Consumer [Member] | |||||
With a specific allowance recorded | 0 | 0 | 0 | ||
With An Allowance Recorded [Member] | Commercial real estate [Member] | |||||
With a specific allowance recorded | 0 | 0 | 0 | ||
With An Allowance Recorded [Member] | Residential [Member] | |||||
With a specific allowance recorded | 0 | 0 | 0 | ||
With An Allowance Recorded [Member] | Commercial and industrial [Member] | |||||
With a specific allowance recorded | 19 | 19 | 10 | ||
With An Allowance Recorded [Member] | Construction and land [Member] | |||||
With a specific allowance recorded | $ 0 | $ 0 | $ 0 |
LOANS - Nonaccrual Loans (Detai
LOANS - Nonaccrual Loans (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Financing Receivable, Recorded Investment, Nonaccrual Status | $ 3,822 | $ 3,128 |
Commercial real estate [Member] | ||
Financing Receivable, Recorded Investment, Nonaccrual Status | 1,452 | 596 |
Residential [Member] | ||
Financing Receivable, Recorded Investment, Nonaccrual Status | 120 | 654 |
Commercial and industrial [Member] | ||
Financing Receivable, Recorded Investment, Nonaccrual Status | 2,250 | 1,878 |
Construction and land [Member] | ||
Financing Receivable, Recorded Investment, Nonaccrual Status | 0 | 0 |
Consumer [Member] | ||
Financing Receivable, Recorded Investment, Nonaccrual Status | $ 0 | $ 0 |
LOANS - Loans by Class Modified
LOANS - Loans by Class Modified as Troubled Debt Restructuring (Details) - Troubled Debt Restructurings [Member] loan in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019USD ($)loan | Jun. 30, 2018USD ($)loan | Jun. 30, 2019USD ($)loan | Jun. 30, 2018USD ($)loan | |
Number of Loans | loan | 0 | 1 | 2 | 3 |
Rate Modification | $ 0 | $ 0 | $ 0 | $ 0 |
Term Modification | 0 | 129 | 176 | 129 |
Interest Only Modification | 0 | 0 | 0 | 0 |
Rate & Term Modification | 0 | 0 | 321 | 787 |
Total | $ 0 | $ 129 | $ 497 | $ 916 |
Consumer [Member] | ||||
Number of Loans | loan | 0 | 0 | 0 | 0 |
Rate Modification | $ 0 | $ 0 | $ 0 | $ 0 |
Term Modification | 0 | 0 | 0 | 0 |
Interest Only Modification | 0 | 0 | 0 | 0 |
Rate & Term Modification | 0 | 0 | 0 | |
Total | $ 0 | $ 0 | $ 0 | $ 0 |
Commercial real estate [Member] | ||||
Number of Loans | loan | 0 | 0 | 0 | 1 |
Rate Modification | $ 0 | $ 0 | $ 0 | $ 0 |
Term Modification | 0 | 0 | 0 | 0 |
Interest Only Modification | 0 | 0 | 0 | 0 |
Rate & Term Modification | 0 | 0 | 0 | 776 |
Total | $ 0 | $ 0 | $ 0 | $ 776 |
Residential [Member] | ||||
Number of Loans | loan | 0 | 1 | 0 | 1 |
Rate Modification | $ 0 | $ 0 | $ 0 | $ 0 |
Term Modification | 0 | 129 | 0 | 129 |
Interest Only Modification | 0 | 0 | 0 | 0 |
Rate & Term Modification | 0 | 0 | 0 | |
Total | $ 0 | $ 129 | $ 0 | $ 129 |
Commercial and industrial [Member] | ||||
Number of Loans | loan | 0 | 0 | 2 | 1 |
Rate Modification | $ 0 | $ 0 | $ 0 | $ 0 |
Term Modification | 0 | 0 | 176 | 0 |
Interest Only Modification | 0 | 0 | 0 | 0 |
Rate & Term Modification | 0 | 0 | 321 | 11 |
Total | $ 0 | $ 0 | $ 497 | $ 11 |
Construction and land [Member] | ||||
Number of Loans | loan | 0 | 0 | 0 | 0 |
Rate Modification | $ 0 | $ 0 | $ 0 | $ 0 |
Term Modification | 0 | 0 | 0 | 0 |
Interest Only Modification | 0 | 0 | 0 | 0 |
Rate & Term Modification | 0 | 0 | 0 | |
Total | $ 0 | $ 0 | $ 0 | $ 0 |
LOANS - Internally Assigned Gra
LOANS - Internally Assigned Grade by Class of Loans (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Total loans [Member] | ||
Risk Category Of Loans By Class | $ 1,219,902 | $ 975,695 |
Total loans [Member] | Consumer [Member] | ||
Risk Category Of Loans By Class | 6,052 | 1,847 |
Total loans [Member] | Commercial real estate [Member] | ||
Risk Category Of Loans By Class | 902,896 | 701,983 |
Total loans [Member] | Residential [Member] | ||
Risk Category Of Loans By Class | 128,590 | 102,708 |
Total loans [Member] | Commercial and industrial [Member] | ||
Risk Category Of Loans By Class | 151,862 | 121,855 |
Total loans [Member] | Construction and land [Member] | ||
Risk Category Of Loans By Class | 30,502 | 47,302 |
Pass [Member] | ||
Risk Category Of Loans By Class | 1,193,555 | 954,325 |
Pass [Member] | Consumer [Member] | ||
Risk Category Of Loans By Class | 6,041 | 1,847 |
Pass [Member] | Commercial real estate [Member] | ||
Risk Category Of Loans By Class | 882,714 | 686,154 |
Pass [Member] | Residential [Member] | ||
Risk Category Of Loans By Class | 127,239 | 101,908 |
Pass [Member] | Commercial and industrial [Member] | ||
Risk Category Of Loans By Class | 149,943 | 119,926 |
Pass [Member] | Construction and land [Member] | ||
Risk Category Of Loans By Class | 27,618 | 44,490 |
Special Mention [Member] | ||
Risk Category Of Loans By Class | 18,680 | 13,569 |
Special Mention [Member] | Consumer [Member] | ||
Risk Category Of Loans By Class | 11 | 0 |
Special Mention [Member] | Commercial real estate [Member] | ||
Risk Category Of Loans By Class | 16,038 | 12,120 |
Special Mention [Member] | Residential [Member] | ||
Risk Category Of Loans By Class | 1,231 | 147 |
Special Mention [Member] | Commercial and industrial [Member] | ||
Risk Category Of Loans By Class | 1,253 | 1,302 |
Special Mention [Member] | Construction and land [Member] | ||
Risk Category Of Loans By Class | 147 | 0 |
Substandard [Member] | ||
Risk Category Of Loans By Class | 7,667 | 7,801 |
Substandard [Member] | Consumer [Member] | ||
Risk Category Of Loans By Class | 0 | |
Substandard [Member] | Commercial real estate [Member] | ||
Risk Category Of Loans By Class | 4,144 | 3,709 |
Substandard [Member] | Residential [Member] | ||
Risk Category Of Loans By Class | 120 | 653 |
Substandard [Member] | Commercial and industrial [Member] | ||
Risk Category Of Loans By Class | 666 | 627 |
Substandard [Member] | Construction and land [Member] | ||
Risk Category Of Loans By Class | 2,737 | 2,812 |
Doubtful [Member] | ||
Risk Category Of Loans By Class | 0 | 0 |
Doubtful [Member] | Consumer [Member] | ||
Risk Category Of Loans By Class | 0 | 0 |
Doubtful [Member] | Commercial real estate [Member] | ||
Risk Category Of Loans By Class | 0 | 0 |
Doubtful [Member] | Residential [Member] | ||
Risk Category Of Loans By Class | 0 | 0 |
Doubtful [Member] | Commercial and industrial [Member] | ||
Risk Category Of Loans By Class | 0 | 0 |
Doubtful [Member] | Construction and land [Member] | ||
Risk Category Of Loans By Class | $ 0 | $ 0 |
LOANS - Aging of the Company's
LOANS - Aging of the Company's Loan Receivable (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Total Past Due | $ 9,020 | $ 5,836 |
Current | 1,192,281 | 957,055 |
PCI Loans | 18,601 | 12,804 |
Total Loans Receivable | 1,219,902 | 975,695 |
Recorded Investment > 90 Days and Accruing | 597 | 0 |
Consumer [Member] | ||
Total Past Due | 5 | 4 |
Current | 6,047 | 1,843 |
PCI Loans | 0 | 0 |
Total Loans Receivable | 6,052 | 1,847 |
Recorded Investment > 90 Days and Accruing | 0 | 0 |
Commercial real estate [Member] | ||
Total Past Due | 6,182 | 3,202 |
Current | 880,865 | 688,005 |
PCI Loans | 15,849 | 10,776 |
Total Loans Receivable | 902,896 | 701,983 |
Recorded Investment > 90 Days and Accruing | 597 | 0 |
Residential [Member] | ||
Total Past Due | 39 | 150 |
Current | 126,795 | 100,765 |
PCI Loans | 1,756 | 1,793 |
Total Loans Receivable | 128,590 | 102,708 |
Recorded Investment > 90 Days and Accruing | 0 | 0 |
Commercial and industrial [Member] | ||
Total Past Due | 2,701 | 2,480 |
Current | 148,385 | 119,373 |
PCI Loans | 776 | 2 |
Total Loans Receivable | 151,862 | 121,855 |
Recorded Investment > 90 Days and Accruing | 0 | 0 |
Construction and land [Member] | ||
Total Past Due | 93 | 0 |
Current | 30,189 | 47,069 |
PCI Loans | 220 | 233 |
Total Loans Receivable | 30,502 | 47,302 |
Recorded Investment > 90 Days and Accruing | 0 | 0 |
30 to 59 Days Past Due [Member] | ||
Total Past Due | 978 | 2,708 |
30 to 59 Days Past Due [Member] | Consumer [Member] | ||
Total Past Due | 0 | 0 |
30 to 59 Days Past Due [Member] | Commercial real estate [Member] | ||
Total Past Due | 306 | 2,345 |
30 to 59 Days Past Due [Member] | Residential [Member] | ||
Total Past Due | 0 | 93 |
30 to 59 Days Past Due [Member] | Commercial and industrial [Member] | ||
Total Past Due | 579 | 270 |
30 to 59 Days Past Due [Member] | Construction and land [Member] | ||
Total Past Due | 93 | 0 |
60 to 89 Days Past Due [Member] | ||
Total Past Due | 4,319 | 709 |
60 to 89 Days Past Due [Member] | Consumer [Member] | ||
Total Past Due | 5 | 4 |
60 to 89 Days Past Due [Member] | Commercial real estate [Member] | ||
Total Past Due | 3,916 | 356 |
60 to 89 Days Past Due [Member] | Residential [Member] | ||
Total Past Due | 39 | 0 |
60 to 89 Days Past Due [Member] | Commercial and industrial [Member] | ||
Total Past Due | 359 | 349 |
60 to 89 Days Past Due [Member] | Construction and land [Member] | ||
Total Past Due | 0 | 0 |
Greater than 90 Days Past Due [Member] | ||
Total Past Due | 3,723 | 2,419 |
Greater than 90 Days Past Due [Member] | Consumer [Member] | ||
Total Past Due | 0 | 0 |
Greater than 90 Days Past Due [Member] | Commercial real estate [Member] | ||
Total Past Due | 1,960 | 501 |
Greater than 90 Days Past Due [Member] | Residential [Member] | ||
Total Past Due | 0 | 57 |
Greater than 90 Days Past Due [Member] | Commercial and industrial [Member] | ||
Total Past Due | 1,763 | 1,861 |
Greater than 90 Days Past Due [Member] | Construction and land [Member] | ||
Total Past Due | $ 0 | $ 0 |
LOANS - Carrying Amount and Unp
LOANS - Carrying Amount and Unpaid Balance of PCI Loans (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Unpaid Principal Balance | $ 22,689 | $ 15,446 |
Carrying Value | 18,601 | 12,804 |
Consumer [Member] | ||
Unpaid Principal Balance | 0 | 0 |
Carrying Value | 0 | 0 |
Commercial real estate [Member] | ||
Unpaid Principal Balance | 18,568 | 12,605 |
Carrying Value | 15,849 | 10,776 |
Residential [Member] | ||
Unpaid Principal Balance | 2,340 | 2,381 |
Carrying Value | 1,756 | 1,793 |
Commercial and industrial [Member] | ||
Unpaid Principal Balance | 1,462 | 125 |
Carrying Value | 776 | 2 |
Construction and land [Member] | ||
Unpaid Principal Balance | 319 | 335 |
Carrying Value | $ 220 | $ 233 |
LOANS - Accretable yield on the
LOANS - Accretable yield on the PCI Loans (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
LOANS | ||||
Balance at beginning of period | $ 231 | $ 353 | $ 256 | $ 372 |
Additions | 350 | 0 | 350 | 0 |
Accretion | (24) | (78) | (46) | (97) |
Payoffs | 0 | 0 | (3) | 0 |
Balance at end of period | $ 557 | $ 275 | $ 557 | $ 275 |
LOANS - Textual (Details)
LOANS - Textual (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
LOANS | |||||
Financing Receivable, Recorded Investment, Nonaccrual Status | $ 3,822 | $ 3,822 | $ 3,128 | ||
Loans and Leases Receivable, Impaired, Interest Lost on Nonaccrual Loans | 46 | $ 9 | 86 | $ 11 | |
Financing Receivable, Recorded Investment, TDR Portfolio, Amount | 1,400 | 1,400 | 1,400 | ||
Financing Receivable, Modification, TDR Loans, Portfolio, Amount | 763,000 | 763,000 | |||
Financing Receivable, TDR Loans, Allowance for Loan Losses | $ 10,000 | $ 10,000 | $ 10,000 |
ALLOWANCE FOR LOAN LOSSES (Deta
ALLOWANCE FOR LOAN LOSSES (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Allowance for loan losses Beginning balance | $ 5,405 | $ 4,600 | $ 5,140 | $ 4,215 |
Allowance for loan losses Charge-offs | 0 | (251) | (21) | (251) |
Allowance for loan losses Recoveries | 30 | 8 | 39 | 139 |
Allowance for loan losses provision for loan losses | 445 | 243 | 722 | 497 |
Allowance for loan losses Ending balance | 5,880 | 4,600 | 5,880 | 4,600 |
Allowance for loan losses related to: Loans individually evaluated for impairment | 19 | 11 | 19 | 11 |
Allowance for loan losses related to: Loans collectively evaluated for impairment | 5,861 | 4,589 | 5,861 | 4,589 |
Allowance for loan losses related to: PCI loans | 0 | 0 | 0 | 0 |
Commercial and industrial [Member] | ||||
Allowance for loan losses Beginning balance | 1,135 | 1,005 | 1,017 | 841 |
Allowance for loan losses Charge-offs | 0 | (251) | 0 | (251) |
Allowance for loan losses Recoveries | 30 | 8 | 39 | 139 |
Allowance for loan losses provision for loan losses | 85 | 140 | 194 | 173 |
Allowance for loan losses Ending balance | 1,250 | 902 | 1,250 | 902 |
Allowance for loan losses related to: Loans individually evaluated for impairment | 19 | 11 | 19 | 11 |
Allowance for loan losses related to: Loans collectively evaluated for impairment | 1,233 | 891 | 1,233 | 891 |
Allowance for loan losses related to: PCI loans | 0 | 0 | 0 | 0 |
Construction and land [Member] | ||||
Allowance for loan losses Beginning balance | 340 | 251 | 327 | 199 |
Allowance for loan losses Charge-offs | 0 | 0 | 0 | 0 |
Allowance for loan losses Recoveries | 0 | 0 | 0 | 0 |
Allowance for loan losses provision for loan losses | (74) | 41 | (61) | 93 |
Allowance for loan losses Ending balance | 266 | 292 | 266 | 292 |
Allowance for loan losses related to: Loans individually evaluated for impairment | 0 | 0 | 0 | 0 |
Allowance for loan losses related to: Loans collectively evaluated for impairment | 266 | 292 | 266 | 292 |
Allowance for loan losses related to: PCI loans | 0 | 0 | 0 | 0 |
Commercial real estate [Member] | ||||
Allowance for loan losses Beginning balance | 3,326 | 2,782 | 3,214 | 2,695 |
Allowance for loan losses Charge-offs | 0 | 0 | (17) | 0 |
Allowance for loan losses Recoveries | 0 | 0 | 0 | 0 |
Allowance for loan losses provision for loan losses | 527 | 179 | 656 | 266 |
Allowance for loan losses Ending balance | 3,853 | 2,961 | 3,853 | 2,961 |
Allowance for loan losses related to: Loans individually evaluated for impairment | 0 | 0 | 0 | 0 |
Allowance for loan losses related to: Loans collectively evaluated for impairment | 3,490 | 2,961 | 3,490 | 2,961 |
Allowance for loan losses related to: PCI loans | 0 | 0 | 0 | 0 |
Residential [Member] | ||||
Allowance for loan losses Beginning balance | 235 | 160 | 215 | 150 |
Allowance for loan losses Charge-offs | 0 | 0 | 0 | 0 |
Allowance for loan losses Recoveries | 0 | 0 | 0 | 0 |
Allowance for loan losses provision for loan losses | (10) | 15 | 10 | 25 |
Allowance for loan losses Ending balance | 225 | 175 | 225 | 175 |
Allowance for loan losses related to: Loans individually evaluated for impairment | 0 | 0 | 0 | 0 |
Allowance for loan losses related to: Loans collectively evaluated for impairment | 587 | 175 | 587 | 175 |
Allowance for loan losses related to: PCI loans | 0 | 0 | 0 | 0 |
Consumer [Member] | ||||
Allowance for loan losses Beginning balance | 2 | 0 | 3 | 3 |
Allowance for loan losses Charge-offs | 0 | 0 | (4) | 0 |
Allowance for loan losses Recoveries | 0 | 0 | 0 | 0 |
Allowance for loan losses provision for loan losses | 0 | 2 | 3 | (1) |
Allowance for loan losses Ending balance | 2 | 2 | 2 | 2 |
Allowance for loan losses related to: Loans individually evaluated for impairment | 0 | 0 | 0 | 0 |
Allowance for loan losses related to: Loans collectively evaluated for impairment | 1 | 2 | 1 | 2 |
Allowance for loan losses related to: PCI loans | 0 | 0 | 0 | 0 |
Unallocated [Member] | ||||
Allowance for loan losses Beginning balance | 367 | 402 | 364 | 327 |
Allowance for loan losses Charge-offs | 0 | 0 | 0 | 0 |
Allowance for loan losses Recoveries | 0 | 0 | 0 | 0 |
Allowance for loan losses provision for loan losses | (83) | (134) | (80) | (59) |
Allowance for loan losses Ending balance | 284 | 268 | 284 | 268 |
Allowance for loan losses related to: Loans individually evaluated for impairment | 0 | 0 | 0 | 0 |
Allowance for loan losses related to: Loans collectively evaluated for impairment | 284 | 268 | 284 | 268 |
Allowance for loan losses related to: PCI loans | $ 0 | $ 0 | $ 0 | $ 0 |
PREMISES AND EQUIPMENT - Premis
PREMISES AND EQUIPMENT - Premises and equipment (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Premises owned | $ 4,571 | $ 10,267 |
Write-down on premises owned | (600) | |
Premises owned, net | 4,571 | 9,667 |
Less accumulated depreciation and amortization | (4,184) | (3,988) |
Total premises and equipment, net | 6,581 | 11,168 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment, Gross | 2,178 | 1,654 |
Furniture Fixtures and Equipment [Member] | ||
Property, Plant and Equipment, Gross | $ 4,016 | $ 3,835 |
PREMISES AND EQUIPMENT - Lease
PREMISES AND EQUIPMENT - Lease payments (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Jan. 01, 2019 |
PREMISES AND EQUIPMENT | ||
2019 | $ 1,465 | |
2020 | 2,759 | |
2021 | 2,431 | |
2022 | 1,801 | |
2023 | 1,299 | |
Thereafter | 1,906 | |
Total lease payments | 11,661 | |
Less: interest | (863) | |
Present value of lease liabilities | $ 10,798 | $ 8,200 |
PREMISES AND EQUIPMENT - Weight
PREMISES AND EQUIPMENT - Weighted average operating lease term and discount rate (Details) | Jun. 30, 2019 |
PREMISES AND EQUIPMENT | |
Weighted-average remaining lease term | 5 years 22 days |
Weighted-average discount rate | 2.89% |
PREMISES AND EQUIPMENT - Additi
PREMISES AND EQUIPMENT - Additional Information (Details) | Mar. 29, 2019USD ($)ft² | Jun. 30, 2019USD ($) | Mar. 31, 2018USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Jan. 01, 2019 |
Depreciation, Depletion and Amortization | $ 261,000 | $ 227,000 | $ 562,000 | $ 458,000 | ||
Sale Leaseback Transaction, Net Book Value | $ 4,600,000 | |||||
Land Subject to Ground Leases | ft² | 4,021 | |||||
Percentage of Leased Land | 11.10% | |||||
Sale Leaseback Transaction, Deferred Gain, Net | $ 78,000,000 | $ 78,000,000 | ||||
Lessor, Operating Lease, Term of Contract | 12 months | |||||
Minimum [Member] | ||||||
Lessor, Operating Lease, Renewal Term | 3 years | 3 years | ||||
Maximum [Member] | ||||||
Lessor, Operating Lease, Renewal Term | 12 years | 12 years |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS - Goodwill (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
GOODWILL AND INTANGIBLE ASSETS | ||
Balance at beginning of period | $ 14,594 | $ 10,365 |
Acquired goodwill | 11,855 | 4,229 |
Impairment | 0 | 0 |
Balance at end of period | $ 26,449 | $ 14,594 |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS - Acquired Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
GOODWILL AND INTANGIBLE ASSETS | |||||
Beginning core deposit intangible | $ 7,205 | $ 4,772 | $ 4,772 | ||
Additions | 566 | 3,604 | |||
Less amortization | $ (392) | $ (290) | (781) | $ (578) | (1,171) |
Ending net core deposit intangible | $ 6,990 | $ 6,990 | $ 7,205 |
GOODWILL AND INTANGIBLE ASSET_4
GOODWILL AND INTANGIBLE ASSETS - Estimated Annual Amortization (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
GOODWILL AND INTANGIBLE ASSETS | |||
2019 | $ 778 | ||
2020 | 1,441 | ||
2021 | 1,418 | ||
2022 | 1,418 | ||
2023 | 642 | ||
Thereafter | 1,293 | ||
Total | $ 6,990 | $ 7,205 | $ 4,772 |
GOODWILL AND INTANGIBLE ASSET_5
GOODWILL AND INTANGIBLE ASSETS - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
GOODWILL AND INTANGIBLE ASSETS | |||||
Amortization of Intangible Assets | $ 392 | $ 290 | $ 781 | $ 578 | $ 1,171 |
INTEREST RECEIVABLE AND OTHER_3
INTEREST RECEIVABLE AND OTHER ASSETS (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
INTEREST RECEIVABLE AND OTHER ASSETS | ||
Other Assets | $ 19,581 | $ 17,381 |
Deferred Tax Assets, Net | 7,295 | 5,891 |
Interest Receivable | 4,228 | 3,676 |
Investment in statutory trusts | 395 | 395 |
All other | 1,077 | 2,495 |
Low Income Housing Partnership | 705 | 607 |
Prepaid Expense | 1,322 | 2,156 |
Restricted Investments | 2,113 | 1,347 |
Servicing Asset | $ 2,446 | $ 814 |
DEPOSITS (Details)
DEPOSITS (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
DEPOSITS | ||
Demand deposits | $ 538,504 | $ 398,045 |
NOW accounts and savings | 248,029 | 246,288 |
Money market | 385,934 | 398,081 |
Time under $250,000 | 189,842 | 117,653 |
Time $250,000 and over | 143,073 | 97,701 |
Total deposits | $ 1,505,382 | $ 1,257,768 |
INTEREST PAYABLE AND OTHER LI_3
INTEREST PAYABLE AND OTHER LIABILITIES (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
INTEREST PAYABLE AND OTHER LIABILITIES | ||
Accrued expenses | $ 5,448 | $ 5,508 |
Deferred rents | 0 | 528 |
CDARS Deferred Fees | 434 | 494 |
Accounts payable | 1,044 | 811 |
Reserve for unfunded commitments | 375 | 330 |
Accrued interest payable | 1,453 | 198 |
Miscellaneous other liabilities | 484 | 506 |
Total | $ 9,238 | $ 8,375 |
OTHER EXPENSES (Details)
OTHER EXPENSES (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
OTHER EXPENSES | |||||
Professional fees | $ 867 | $ 557 | $ 1,264 | $ 898 | |
Core deposit premium amortization | 392 | 290 | 781 | 578 | $ 1,171 |
Marketing and promotions | 396 | 248 | 606 | 459 | |
Stationary and supplies | 161 | 91 | 298 | 215 | |
Insurance (including FDIC premiums) | 159 | 107 | 315 | 265 | |
Communication and postage | 112 | 109 | 207 | 222 | |
Loan default related expense | 119 | 3 | 150 | 44 | |
Director fees | 375 | 72 | 496 | 131 | |
Bank service charges | 19 | 18 | 31 | 47 | |
Courier expense | 117 | 110 | 231 | 227 | |
Write-down on premises | 0 | 600 | 0 | 600 | |
Other expenses | 133 | 21 | 222 | 66 | |
Total | $ 2,850 | $ 2,226 | $ 4,601 | $ 3,752 |
EQUITY INCENTIVE PLANS - Restri
EQUITY INCENTIVE PLANS - Restricted Stock Grant Activity (Details) - $ / shares shares in Thousands | 3 Months Ended | |||
Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 | Mar. 31, 2018 | |
EQUITY INCENTIVE PLANS | ||||
Shares Non-vested | 134,036 | 131,000 | 74,007 | 67,481 |
Shares Granted | 45,696 | 22,289 | 78,148 | 15,232 |
Shares Vested | (36,582) | (19,253) | 0 | (8,706) |
Shares Non-vested | 143,150 | 134,036 | 152,155 | 74,007 |
Weighted-Average Grant Date Fair Value Non-vested | $ 20.76 | $ 19.18 | $ 14.60 | $ 13.51 |
Weighted-Average Grant Date Fair Value Granted | 24.60 | 22.38 | 22 | 19.45 |
Weighted-Average Grant Date Fair Value Vested | 19.55 | 19.51 | 0 | 13.40 |
Weighted-Average Grant Date Fair Value Non-vested | $ 21.63 | $ 20.76 | $ 19.05 | $ 14.60 |
EQUITY INCENTIVE PLANS - Additi
EQUITY INCENTIVE PLANS - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 148,962 | |||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized | $ 2,600,000 | $ 2,600,000 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 450,000 | 450,000 | ||
Maximum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 10 years | |||
Restricted Stock [Member] | Non-employee directors [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 1 year | |||
Restricted Stock [Member] | Minimum [Member] | Executive Officer [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 3 years | |||
Restricted Stock [Member] | Maximum [Member] | Executive Officer [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 5 years | |||
2017 Omnibus Equity Incentive Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 161,365 | |||
2017 Omnibus Equity Incentive Plan [Member] | Officers And Employees [Member] | ||||
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 50,000 | |||
2017 Omnibus Equity Incentive Plan [Member] | Restricted Stock [Member] | Officers And Employees [Member] | ||||
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 25,000 | |||
Stock Issued During Period, Value, Restricted Stock Award, Gross | $ 2,000,000 | |||
2014 Omnibus Equity Incentive Plan [Member] | ||||
Share Based Compensation | $ 320,000 | $ 308,000 | $ 440,000 | $ 454,000 |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 2 years | |||
2014 Omnibus Equity Incentive Plan [Member] | Minimum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 1 year | |||
2014 Omnibus Equity Incentive Plan [Member] | Maximum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 5 years |
FAIR VALUE MEASUREMENT - Financ
FAIR VALUE MEASUREMENT - Financial Instruments Measured at Fair Value on a Recurring Basis (Details) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Assets, Fair Value Disclosure | $ 100,271 | $ 99,796 |
Corporate Bonds [Member] | ||
Assets, Fair Value Disclosure | 10,171 | 4,717 |
U.S. Treasuries [Member] | ||
Assets, Fair Value Disclosure | 996 | 985 |
U.S. Government Agencies [Member] | ||
Assets, Fair Value Disclosure | 13,587 | 13,765 |
Mortgage backed securities [Member] | ||
Assets, Fair Value Disclosure | 29,646 | 49,602 |
Collateralized mortgage obligations [Member] | ||
Assets, Fair Value Disclosure | 24,166 | 6,983 |
SBA securities [Member] | ||
Assets, Fair Value Disclosure | 4,241 | 4,241 |
Municipal securities [Member] | ||
Assets, Fair Value Disclosure | 17,464 | 19,503 |
Fair Value, Inputs, Level 1 [Member] | ||
Assets, Fair Value Disclosure | 996 | 985 |
Fair Value, Inputs, Level 1 [Member] | Corporate Bonds [Member] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Fair Value, Inputs, Level 1 [Member] | U.S. Treasuries [Member] | ||
Assets, Fair Value Disclosure | 996 | 985 |
Fair Value, Inputs, Level 1 [Member] | U.S. Government Agencies [Member] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Fair Value, Inputs, Level 1 [Member] | Mortgage backed securities [Member] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Fair Value, Inputs, Level 1 [Member] | Collateralized mortgage obligations [Member] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Fair Value, Inputs, Level 1 [Member] | SBA securities [Member] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Fair Value, Inputs, Level 1 [Member] | Municipal securities [Member] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | ||
Assets, Fair Value Disclosure | 99,275 | 98,811 |
Fair Value, Inputs, Level 2 [Member] | Corporate Bonds [Member] | ||
Assets, Fair Value Disclosure | 10,171 | 4,717 |
Fair Value, Inputs, Level 2 [Member] | U.S. Treasuries [Member] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | U.S. Government Agencies [Member] | ||
Assets, Fair Value Disclosure | 13,587 | 13,765 |
Fair Value, Inputs, Level 2 [Member] | Mortgage backed securities [Member] | ||
Assets, Fair Value Disclosure | 29,646 | 49,602 |
Fair Value, Inputs, Level 2 [Member] | Collateralized mortgage obligations [Member] | ||
Assets, Fair Value Disclosure | 24,166 | 6,983 |
Fair Value, Inputs, Level 2 [Member] | SBA securities [Member] | ||
Assets, Fair Value Disclosure | 4,241 | 4,241 |
Fair Value, Inputs, Level 2 [Member] | Municipal securities [Member] | ||
Assets, Fair Value Disclosure | 17,464 | 19,503 |
Fair Value, Inputs, Level 3 [Member] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Corporate Bonds [Member] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | U.S. Treasuries [Member] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | U.S. Government Agencies [Member] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Mortgage backed securities [Member] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Collateralized mortgage obligations [Member] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | SBA securities [Member] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Municipal securities [Member] | ||
Assets, Fair Value Disclosure | $ 0 | $ 0 |
FAIR VALUE MEASUREMENT - Impair
FAIR VALUE MEASUREMENT - Impaired Loans Measured at Fair Value on a Non-Recurring Basis (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
OREO | $ 627 | $ 801 |
Fair Value, Measurements, Nonrecurring [Member] | ||
Impaired Loan on Assets Measured at Fair Value | 763 | 750 |
Nonperforming impaired loans | 3,822 | 3,128 |
OREO | 627 | 801 |
Total assets measured at fair value | 5,212 | 4,679 |
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Nonrecurring [Member] | ||
Impaired Loan on Assets Measured at Fair Value | 0 | 0 |
Nonperforming impaired loans | 0 | 0 |
OREO | 0 | 0 |
Total assets measured at fair value | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Nonrecurring [Member] | ||
Impaired Loan on Assets Measured at Fair Value | 0 | 0 |
Nonperforming impaired loans | 0 | 0 |
OREO | 0 | 0 |
Total assets measured at fair value | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Nonrecurring [Member] | ||
Impaired Loan on Assets Measured at Fair Value | 763 | 750 |
Nonperforming impaired loans | 3,822 | 3,128 |
OREO | 627 | 801 |
Total assets measured at fair value | $ 5,212 | $ 4,679 |
FAIR VALUE MEASUREMENT - Estima
FAIR VALUE MEASUREMENT - Estimated Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Dec. 31, 2017 |
Financial assets: | ||||
Cash and cash equivalents | $ 351,594 | $ 323,581 | $ 318,267 | $ 249,853 |
Interest bearing deposits with financial institutions | 3,232 | 3,980 | ||
Investment securities available for sale | 100,271 | 99,796 | ||
Loans held for sale | 1,016 | 855 | ||
Loans, net | 1,213,527 | 970,189 | ||
Other equity securities | 9,243 | |||
Accrued interest receivable | 4,228 | 3,676 | ||
Cash and cash equivalents, Fair value | 351,594 | 323,581 | ||
Interest bearing deposits with financial institutions, Fair value | 3,232 | 3,980 | ||
Investment securities available for sale, Fair value | 100,271 | 99,796 | ||
Loans held for sale, Fair value | 1,016 | 855 | ||
Loans, net, Fair value | 1,213,527 | 967,882 | ||
Other equity securities, Fair value | 11,343 | 9,243 | ||
Accrued interest receivable, Fair value | 4,228 | 3,676 | ||
Financial liabilities: | ||||
Deposits | 1,505,382 | 1,257,768 | ||
Junior subordinated debt | 8,201 | 8,161 | ||
Accrued interest payable | 1,453 | 198 | ||
Deposits, Fair value | 1,505,382 | 1,259,045 | ||
Subordinated Debentures, Fair value | 8,201 | 6,824 | ||
Accrued interest payable, Fair value | 1,453 | 198 | ||
Off-balance-sheet liabilities: | ||||
Undisbursed loan commitments, lines of credit, standby letters of credit | 121,438 | 101,076 | ||
Undisbursed loan commitments, lines of credit, standby letters of credit, Fair value | 121,063 | 100,746 | ||
Fair Value, Inputs, Level 1 [Member] | ||||
Financial assets: | ||||
Loans held for sale | 0 | 0 | ||
Loans, net | 0 | 0 | ||
Other equity securities | 9,243 | |||
Cash and cash equivalents, Fair value | 351,594 | 323,581 | ||
Interest bearing deposits with financial institutions, Fair value | 3,232 | 3,980 | ||
Investment securities available for sale, Fair value | 996 | 985 | ||
Other equity securities, Fair value | 11,343 | |||
Accrued interest receivable, Fair value | 0 | 0 | ||
Financial liabilities: | ||||
Deposits, Fair value | 0 | 0 | ||
Subordinated Debentures, Fair value | 0 | 0 | ||
Accrued interest payable, Fair value | 0 | 0 | ||
Off-balance-sheet liabilities: | ||||
Undisbursed loan commitments, lines of credit, standby letters of credit, Fair value | 0 | 0 | ||
Fair Value, Inputs, Level 2 [Member] | ||||
Financial assets: | ||||
Loans held for sale | 1,016 | 855 | ||
Loans, net | 0 | 0 | ||
Other equity securities | 0 | |||
Cash and cash equivalents, Fair value | 0 | 0 | ||
Interest bearing deposits with financial institutions, Fair value | 0 | 0 | ||
Investment securities available for sale, Fair value | 99,275 | 98,811 | ||
Other equity securities, Fair value | 0 | |||
Accrued interest receivable, Fair value | 4,228 | 3,676 | ||
Financial liabilities: | ||||
Deposits, Fair value | 1,505,382 | 1,259,045 | ||
Subordinated Debentures, Fair value | 0 | 0 | ||
Accrued interest payable, Fair value | 1,453 | 198 | ||
Off-balance-sheet liabilities: | ||||
Undisbursed loan commitments, lines of credit, standby letters of credit, Fair value | 0 | 0 | ||
Fair Value, Inputs, Level 3 [Member] | ||||
Financial assets: | ||||
Loans held for sale | 0 | 0 | ||
Loans, net | 1,213,527 | 967,882 | ||
Other equity securities | 0 | |||
Cash and cash equivalents, Fair value | 0 | 0 | ||
Interest bearing deposits with financial institutions, Fair value | 0 | 0 | ||
Investment securities available for sale, Fair value | 0 | 0 | ||
Other equity securities, Fair value | 0 | |||
Accrued interest receivable, Fair value | 0 | 0 | ||
Financial liabilities: | ||||
Deposits, Fair value | 0 | 0 | ||
Subordinated Debentures, Fair value | 8,201 | 6,824 | ||
Accrued interest payable, Fair value | 0 | 0 | ||
Off-balance-sheet liabilities: | ||||
Undisbursed loan commitments, lines of credit, standby letters of credit, Fair value | $ 121,063 | $ 100,746 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Loss Contingencies [Line Items] | ||
Loans and Leases Receivable, Loans in Process | $ 120,700,000 | $ 99,200,000 |
Guarantor Obligations, Maximum Exposure, Undiscounted | 769,000 | 1,800,000 |
Advances from Federal Home Loan Banks | 1,000,000 | 11,500,000 |
Deposits | 1,505,382,000 | 1,257,768,000 |
Customer Concentration Risk [Member] | ||
Loss Contingencies [Line Items] | ||
Deposits | 129,800,000 | 148,600,000 |
Interest Payable And Other Liabilities [Member] | ||
Loss Contingencies [Line Items] | ||
Loss Contingency Accrual | $ 375,000 | $ 330,000 |
Deposit [Member] | ||
Loss Contingencies [Line Items] | ||
Concentration Risk, Percentage | 8.60% | 11.50% |
Low Income Housing Tax Credit Partnerships [Member] | ||
Loss Contingencies [Line Items] | ||
Loans and Leases Receivable, Loans in Process | $ 3,600,000 | $ 3,800,000 |
Small Business Investment Company [Member] | ||
Loss Contingencies [Line Items] | ||
Loans and Leases Receivable, Loans in Process | $ 473,000 | $ 976,000 |