Old Second Bancorp (OSBC) 10-Q 7 Nov 18 2018 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2018	Nov. 02, 2018
Document and Entity Information
Entity Registrant Name	OLD SECOND BANCORP INC
Entity Central Index Key	357,173
Document Type	10-Q
Document Period End Date	Sep. 30, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Common Stock, Shares Outstanding		29,758,578
Document Fiscal Year Focus	2,018
Document Fiscal Period Focus	Q3

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Assets
Cash and due from banks	$ 34,366	$ 37,444
Interest bearing deposits with financial institutions	15,956	18,389
Cash and cash equivalents	50,322	55,833
Securities available-for-sale, at fair value	542,338	541,439
Federal Home Loan Bank and Federal Reserve Bank stock	10,511	10,168
Loans held-for-sale	2,911	4,067
Loans	1,834,949	1,617,622
Less: allowance for loan losses	19,328	17,461
Net loans	1,815,621	1,600,161
Premises and equipment, net	42,752	37,628
Other real estate owned	6,964	8,371
Mortgage servicing rights, net	8,131	6,944
Goodwill and core deposit intangible	21,947	8,922
Bank-owned life insurance (BOLI)	61,506	61,764
Deferred tax assets, net	25,116	25,356
Other assets	24,354	22,776
Total assets	2,612,473	2,383,429
Deposits:
Noninterest bearing demand	621,580	572,404
Interest bearing:
Savings, NOW, and money market	1,045,886	967,750
Time	464,904	382,771
Total deposits	2,132,370	1,922,925
Securities sold under repurchase agreements	44,333	29,918
Other short-term borrowings	81,875	115,000
Junior subordinated debentures	57,674	57,639
Senior notes	44,133	44,058
Notes payable and other borrowings	18,050
Other liabilities	15,908	13,539
Total liabilities	2,394,343	2,183,079
Stockholders' Equity
Common stock	34,717	34,626
Additional paid-in capital	118,625	117,742
Retained earnings	167,140	142,959
Accumulated other comprehensive loss	(6,058)	1,479
Treasury stock	(96,294)	(96,456)
Total stockholders' equity	218,130	200,350
Total liabilities and stockholders' equity	$ 2,612,473	$ 2,383,429

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - $ / shares	Sep. 30, 2018	Dec. 31, 2017
Consolidated Balance Sheets
Common stock, Par value (in dollars per share)	$ 1	$ 1
Common Stock, Shares authorized	60,000,000	60,000,000
Common stock, Shares issued	34,716,589	34,625,734
Common stock, Shares outstanding	29,747,078	29,627,086
Treasury stock, Shares	4,969,511	4,998,648

Consolidated Statements of Inco

Consolidated Statements of Income - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Interest and Dividend Income
Loans, including fees	$ 23,377	$ 18,208	$ 64,625	$ 52,202
Loans held-for-sale	39	34	94	95
Securities:
Taxable	2,491	2,424	7,053	7,994
Tax exempt	2,064	1,628	6,239	4,188
Dividends from FHLBC and FRBC stock	121	94	338	271
Interest bearing deposits with financial institutions	84	37	230	91
Total interest and dividend income	28,176	22,425	78,579	64,841
Interest Expense
Savings, NOW, and money market deposits	642	239	1,487	695
Time deposits	1,568	1,077	4,187	3,081
Securities sold under repurchase agreements	140	4	323	10
Other short-term borrowings	311	220	916	472
Junior subordinated debentures	930	930	2,784	3,073
Senior notes	672	672	2,016	2,017
Notes payable and other borrowings	173		268
Total interest expense	4,436	3,142	11,981	9,348
Net interest and dividend income	23,740	19,283	66,598	55,493
Provision for loan and lease losses		300	728	1,050
Net interest and dividend income after (release) provisions for loan losses	23,740	18,983	65,870	54,443
Noninterest Income
Mortgage servicing rights mark to market loss	(11)	(194)	189	(756)
Net gain on sales of mortgage loans	965	1,095	3,122	3,715
Securities gains (losses), net	13	102	360	(165)
Increase in cash surrender value of BOLI	347	362	946	1,071
Death benefit realized on bank-owned life insurance			1,026
Debit card interchange income	1,135	1,075	3,279	3,131
Losses on disposal and transfer of fixed assets, net				10
Other income	1,128	1,567	3,755	3,739
Total noninterest income	7,814	7,843	24,851	22,188
Noninterest Expense
Salaries and employee benefits	11,165	10,049	33,727	31,167
Occupancy, furniture and equipment	1,782	1,482	4,992	4,510
Computer and data processing	1,247	1,081	5,332	3,283
FDIC insurance	162	199	483	512
General bank insurance	230	246	780	780
Amortization of core deposit intangible	136	24	254	74
Advertising expense	492	255	1,325	1,093
Debit card interchange expense	320	285	902	1,033
Legal fees	243	162	688	450
Other real estate expense, net	(370)	680	232	1,928
Other expense	3,304	2,455	9,636	8,128
Total noninterest expense	18,711	16,918	58,351	52,958
Income before income taxes	12,843	9,908	32,370	23,673
Provision for income taxes	3,201	1,831	6,978	6,023
Net income available to common stockholders	$ 9,642	$ 8,077	$ 25,392	$ 17,650
Basic earnings per share (in dollars per share)	$ 0.32	$ 0.27	$ 0.85	$ 0.60
Diluted earnings per share (in dollars per share)	0.32	0.27	0.84	0.59
Dividends declared per share (in dollars per share)	$ 0.01	$ 0.01	$ 0.03	$ 0.03
Deposit Account
Noninterest Income
Service charges on deposits	$ 1,923	$ 1,722	$ 5,284	$ 4,955
Fiduciary and Trust
Noninterest Income
Service charges on deposits	1,644	1,468	4,784	4,564
Mortgage Banking
Noninterest Income
Service charges on deposits	199	195	556	594
Bank Servicing
Noninterest Income
Service charges on deposits	$ 471	$ 451	$ 1,550	$ 1,330

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Consolidated Statements of Comprehensive Income
Net income	$ 9,642	$ 8,077	$ 25,392	$ 17,650
Unrealized holding (losses) gains on available-for-sale securities arising during the period	(2,801)	2,971	(12,999)	13,798
Related tax benefit (expense)	788	(1,191)	3,664	(5,556)
Holding (losses) gains after tax on available-for-sale securities	(2,013)	1,780	(9,335)	8,242
Less: Reclassification adjustment for the net gains (losses) realized during the period
Net realized (losses) gains	12	102	360	(165)
Income tax (expense) benefit on net realized gains (losses)	(2)	(42)	(100)	24
Net realized gains (losses) after tax	10	60	260	(141)
Other comprehensive (loss) income on available-for-sale securities	(2,023)	1,720	(9,595)	8,383
Changes in fair value of derivatives used for cashflow hedges	628	19	2,422	(445)
Related tax benefit	(176)	8	(683)	192
Other comprehensive income on cashflow hedges	452	27	1,739	(253)
Total other comprehensive (loss) income	(1,571)	1,747	(7,856)	8,130
Total comprehensive income	$ 8,071	$ 9,824	$ 17,536	$ 25,780

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Cash flows from operating activities
Net income	$ 8,077	$ 25,392	$ 17,650
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization of leasehold improvement		1,778	1,760
Change in fair value of mortgage servicing rights	194	(189)	756
Provision for loan and lease losses	300	728	1,050
Provision for deferred tax expense		6,777	5,682
Originations of loans held-for-sale		(107,947)	(113,077)
Proceeds from sales of loans held-for-sale		111,169	119,059
Net gain on sales of mortgage loans	(1,095)	(3,122)	(3,715)
Net discount (accretion)/premium amortization of purchase accounting adjustments on loans		(776)	(1,115)
Change in current income taxes receivable		671	111
Increase in cash surrender value of BOLI	(362)	(946)	(1,071)
Change in accrued interest receivable and other assets		533	(6,849)
Change in accrued interest payable and other liabilities		2,432	4,571
Net premium amortization/discount (accretion) on securities		2,128	1,320
Securities (gains) losses, net	(102)	(360)	165
Amortization of core deposit	24	254	74
Amortization of junior subordinated debentures issuance costs		35	36
Amortization of senior notes issuance costs		75	77
Stock based compensation		1,641	897
Net gains on sale of other real estate owned	(276)	(716)	(454)
Provision for other real estate owned valuation losses	920	485	1,630
Net losses on disposal and transfer of fixed assets			(10)
Net cash provided by operating activities		40,042	28,547
Cash flows from investing activities
Proceeds from maturities and calls including pay down of securities available-for-sale		32,890	105,327
Proceeds from sales of securities available-for-sale	51,620	94,663	152,476
Purchases of securities available-for-sale		(71,488)	(246,971)
Net disbursements/proceeds from sales (purchases) of FHLBC stock		2,627	(2,475)
Net disbursements/proceeds from (purchases) sales of FRB stock		(1,421)
Net change in loans		9,988	(118,711)
Proceeds from clains on BOLI, net of premiums paid		1,204
Improvements in other real estate owned		(59)
Proceeds from sales of other real estate owned, net of participation purchase		4,292	5,512
Proceeds from disposition of premises and equipment			13
Net purchases of premises and equipment		(1,563)	(852)
Cash paid for acquisition, net of cash and cash equivalent retained		(35,711)
Net cash provided by (used in) investing activities		35,422	(105,681)
Cash flows from financing activities
Net change in deposits		(39,053)	22,330
Net change in securities sold under repurchase agreements		8,792	1,138
Net change in other short-term borrowings		(44,000)	55,000
Payment of senior note issuance costs			(42)
Net change in notes payable and other borrowings		(5,317)
Dividends paid common stock		(892)	(888)
Purchase of treasury stock		(505)	(236)
Net cash (used in) provided by financing activities		(80,975)	77,302
Net change in cash and cash equivalents		(5,511)	168
Cash and cash equivalents at beginning of period		55,833	47,334
Cash and cash equivalents at end of period	47,502	50,322	$ 47,502
Supplemental cash flow information
Income taxes paid	230
Interest paid for deposits	3,802	5,381
Interest paid for borrowings	4,890	5,482
Non-cash transfer of loans to other real estate owned	3,701	$ 2,194
Non-cash transfer of premises to other real estate owned	$ 95

Consolidated Statements of Chan

Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands	Common Stock	Additional Paid In Capital	Retained Earnings	Accumulated Other Comprehensive Income (Loss)	Treasury Stock	Total
Balance at Dec. 31, 2016	$ 34,534	$ 116,653	$ 129,005	$ (8,762)	$ (96,220)	$ 175,210
Increase (Decrease) in Stockholders' Equity
Net income			17,650			17,650
Other comprehensive income, net of tax				8,130		8,130
Dividends declared and paid			(888)			(888)
Vesting of restricted stock	92	(92)
Stock based compensation		897				897
Purchase of treasury stock					(236)	(236)
Balance at Sep. 30, 2017	34,626	117,458	145,767	(632)	(96,456)	200,763
Balance at Dec. 31, 2017	34,626	117,742	142,959	1,479	(96,456)	200,350
Increase (Decrease) in Stockholders' Equity
Net income			25,392			25,392
Other comprehensive income, net of tax				(7,856)		(7,856)
Dividends declared and paid			(892)			(892)
Vesting of restricted stock	91	(758)			667
Cumulative effect of change in accounting principle			(319)	319
Stock based compensation		1,641				1,641
Purchase of treasury stock					(505)	(505)
Balance at Sep. 30, 2018	$ 34,717	$ 118,625	$ 167,140	$ (6,058)	$ (96,294)	$ 218,130

Consolidated Statements of Ch_2

Consolidated Statements of Changes in Stockholders' Equity (Parenthetical) - $ / shares	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Consolidated Statements of Changes in Stockholders' Equity
Dividend declared and paid (per share)	$ 0.03	$ 0.03

Summary of Significant Accounti

Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2018
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies	Note 1 – Summary of Significant Accounting Policies The accounting policies followed in the preparation of the interim consolidated financial statements are consistent with those used in the preparation of the annual financial information. The interim consolidated financial statements reflect all normal and recurring adjustments that are necessary, in the opinion of management, for a fair statement of results for the interim period presented. Results for the period ended September 30, 2018, are not necessarily indicative of the results that may be expected for the year ending December 31, 2018. These interim consolidated financial statements are unaudited and should be read in conjunction with the audited financial statements and notes included in Old Second Bancorp, Inc.’s (the “Company”) annual report on Form 10-K for the year ended December 31, 2017. Unless otherwise indicated, amounts in the tables contained in the notes to the consolidated financial statements are in thousands. Certain items in prior periods have been reclassified to conform to the current presentation. The Company’s consolidated financial statements are prepared in accordance with United States generally accepted accounting principles (“GAAP”) and follow general practices within the banking industry. Application of these principles requires management to make estimates, assumptions, and judgments that affect the amounts reported in the consolidated financial statements and accompanying notes. These estimates, assumptions, and judgments are based on information available as of the date of the consolidated financial statements. Future changes in information may affect these estimates, assumptions, and judgments, which, in turn, may affect amounts reported in the consolidated financial statements. Significant accounting policies are presented in Note 1 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017. These policies, along with the disclosures presented in the other financial statement notes and in this discussion, provide information on how significant assets and liabilities are valued in the consolidated financial statements and how those values are determined. In addition to the significant accounting policies presented in our Form 10-K, as noted above, as a result of our acquisition of Greater Chicago Financial Corp. (“GCFC”), and its wholly-owned subsidiary, ABC Bank, that closed in the second quarter of 2018, the Company has implemented accounting policies regarding purchased loans. Loans purchased as a result of a business combination are recorded at estimated fair value on the acquisition date, with no carryover of the related allowance for loan and lease losses recorded by the acquiree at the time of purchase. These loans are segregated into two classifications upon purchase: 1) purchased non-credit impaired (“non-PCI”) loans, accounted for in accordance with FASB ASC Subtopic 310-20 “ Nonrefundable Fees and Costs ” (“ASC 310-20”), which have a discount attributable in part to credit quality. Premiums and discounts created when ASC 310-20 loans are recorded at their fair values at acquisition are amortized over the remaining terms of the loans as an adjustment to the related loan’s yield; and 2) purchased credit impaired (“PCI”) loans, accounted for under FASB ASC Subtopic 310-30, “ Loans and Debt Securities Acquired with Deteriorated Credit Quality ” (“ASC 310-30”) as they display signs of credit deterioration. Interest income, through accretion of the difference between the carrying value of the loans and the expected cash flows, is recognized on the acquired loans accounted for under ASC 310-30. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09 “ Revenue from Contracts with Customers (Topic 606).” The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services. In August 2015, the FASB issued ASU 2015-14 “ Revenue from Contracts with Customers (Topic 606) Deferral of the Effective Date, ” which deferred the effective date of ASU 2014-09 for an additional year. ASU 2015-14 was effective for annual reporting periods beginning after December 15, 2017. The amendments could be applied retrospectively to each prior reporting period or retrospectively with the cumulative effect of initially applying this update recognized at the date of initial application. Early application was not permitted. In March 2016, the FASB issued ASU 2016-08 “ Revenue from Contracts with Customers (TOPIC 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) ” and in April 2016, the FASB issued ASU 2016-10 “ Revenue from Contracts with Customers (TOPIC 606): Identifying Performance Obligations and Licensing.” ASU 2016-08 requires the entity to determine if it is acting as a principal with control over the goods or services it is contractually obligated to provide, or an agent with no control over specified goods or services provided by another party to a customer. ASU 2016-10 was issued to further clarify ASU 2014-09 implementation regarding identifying performance obligation materiality, identification of key contract components, and scope. The Company performed an analysis of the impact of adoption of this ASU, reviewing revenue recorded from service charges on deposit accounts, asset management fees, gains (losses) on other real estate owned, and debit card interchange fees. Certain revenue received, such as service charges on deposit accounts and interchange fees, is recorded immediately or as the service is performed. Asset management fees recorded by the Company take the form of wealth management income and brokerage income, and both types of fees are recorded after services are rendered, with no contractual requirement of refund to a customer based on non-achievement of fund performance objectives. Finally, the methodology used to record revenue from gains (losses) due to the sale of other real estate owned is not anticipated to change, as the Company currently records income or expense only upon consummation of the sale, and any revenue recorded stemming from seller financed transactions is reviewed for deferral, as appropriate. The Company adopted ASU 2014-09 and related issuances on January 1, 2018, with no cumulative effect adjustment to opening retained earnings required upon implementation of this standard. In January 2016, the FASB issued ASU No. 2016-01 “ Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities .” The objective of the issuance is to provide users of financial statements with more decision–useful information, by making targeted improvements to GAAP. These targeted improvements included revisions to the methodology of accounting for equity investments, eliminating certain disclosures on fair value assumptions for financial instruments measured at amortized cost, and requiring public business entities to use the exit price notion, as defined in ASC 820, for the measurement of the fair value of financial instruments. This standard was effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company adopted this standard as of January 1, 2018. Adoption of this standard resulted in the Company’s use of an exit price rather than an entrance price to determine the fair value of loans and deposits not already measured at fair value on a non-recurring basis in the consolidated balance sheet disclosures; see Note 14–Fair Value of Financial Instruments for further information regarding the valuation processes. In February 2016, the FASB issued ASU No. 2016-02 “ Leases (Topic 842) .” This ASU was issued to increase transparency and comparability among organizations by recognizing lease assets and liabilities on the balance sheet and disclosing key information about leasing arrangements. One key revision from prior guidance was to include operating leases within assets and liabilities recorded; another revision was to create a new model to follow for sale-leaseback transactions. The impact of this pronouncement will primarily affect lessees, as virtually all of their assets will be recognized on the balance sheet, by recording a right of use asset and lease liability. This pronouncement is effective for fiscal years beginning after December 15, 2018. In July 2018, the FASB issued ASU No. 2018-11, “Leases (Topic 842): Targeted Improvements ” which provided additional guidance on the transition method, including application as a cumulative-effect adjustment to equity and practical expedients to use when accounting for lease components. The Company is in the process of identifying the population of all lease arrangements and an implementation team is currently assessing the impact of the ASU on the Company’s processes, accounting, internal controls over financial reporting, and regulatory capital. In June 2016, the FASB issued ASU No. 2016-13 “ Measurement of Credit Losses on Financial Instruments (Topic 326). ” ASU 2016-13 was issued to provide financial statement users with more useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date to enhance the decision making process. The new methodology to be used should reflect expected credit losses based on relevant vintage historical information, supported by reasonable forecasts of projected loss given defaults, which will affect the collectability of the reported amounts. This new methodology will also require available-for-sale debt securities to have a credit loss recorded through an allowance rather than write-downs. ASU 2016-13 is effective for financial statements issued for fiscal years beginning after December 15, 2019. The Company is assessing the impact of ASU 2016-13 on its accounting and disclosures, and has determined that a loss rate model will be used for calculation of future risk assessments upon the ASU’s adoption in 2020. The Company has accumulated historical data by loan pools and collateral classifications, and anticipates calculation of estimates for at least two quarters in 2019 on a test basis to confirm model processes and to determine financial statement impact prior to adoption in 2020. In March 2017, the FASB issued ASU No. 2017-08 “ Receivables-Nonrefundable Fees and Other Costs – Premium Amortization on Purchased Callable Debt Securities (Subtopic 310-20) .” This ASU was issued to shorten the amortization period for the premium to the earliest call date on debt securities. This premium is required to be recorded as a reduction to net interest margin during the shorter yield to call period, as compared to prior practice of amortizing the premium as a reduction to net interest margin over the contractual life of the instrument. This ASU does not change the current method of amortizing any discount over the contractual life of the debt security, and this pronouncement is effective for fiscal years beginning after December 15, 2018, with earlier adoption permitted. The Company adopted ASU 2017-08 as a change in accounting principle in the third quarter of 2017 on a modified retrospective basis, which required the Company to reflect its adoption effective January 1, 2017. The effect of amortizing the premium over a shorter period will continue to decrease future quarterly net interest income over the call period until the premium is fully amortized. As a result of management’s analysis, the impact of the change in accounting principle as a result of ASU 2017-08 to adjust beginning of year retained earnings was considered insignificant and, accordingly, the impact was adjusted through 2017 earnings. In August 2017, the FASB issued ASU No. 2017-12, “ Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities”. The purpose of this updated guidance is to better align a company’s financial reporting for hedging activities with the economic objectives of those activities. ASU 2017-12 is effective for public business entities for fiscal years beginning after December 15, 2018, with early adoption, including adoption in an interim period, permitted. The Company adopted ASU 2017-12 on January 1, 2018, on a modified retrospective basis. FASB ASC 815, Derivatives and Hedging (“ASC 815”), provides the disclosure requirements for derivatives and hedging activities with the intent to provide users of financial statements with an enhanced understanding of: (a) how and why an entity uses derivative instruments, (b) how the entity accounts for derivative instruments and related hedged items, and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. Further, qualitative disclosures are required that explain the Company’s objectives and strategies for using derivatives, as well as quantitative disclosures about the fair value of and gains and losses on derivative instruments, and disclosures about credit-risk-related contingent features in derivative instruments. As required by ASC 815, the Company records all derivatives on the balance sheet at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether the Company has elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to changes in the fair value of an asset, liability, or firm commitment attributable to a particular risk, such as interest rate risk, are considered fair value hedges. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Derivatives may also be designated as hedges of the foreign currency exposure of a net investment in a foreign operation. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the recognition of the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk in a fair value hedge or the earnings effect of the hedged forecasted transactions in a cash flow hedge. The Company may enter into derivative contracts that are intended to economically hedge certain of its risk, even though hedge accounting does not apply or the Company elects not to apply hedge accounting. In accordance with the FASB’s fair value measurement guidance in ASU 2011-04, the Company made an accounting policy election to measure the credit risk of its derivative financial instruments that are subject to master netting agreements on a net basis by counterparty portfolio. As the Company does not currently have any derivative financial instruments subject to master netting agreements, there was no impact to the balance sheet. In February 2018, the FASB issued ASU No. 2018-02, “ Income Statement-Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income .” This ASU was issued in response to the enactment of tax bill H.R.1 “Tax Cuts and Jobs Act”, which resulted in “stranding” the tax effects of items within accumulated other comprehensive income related to the adjustment of deferred taxes due to the reduction of the federal corporate income tax rate. The amendments proposed allow the reclassification of these stranded tax effects to retained earnings, and were effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted, and should be applied either in the period of adoption or retrospectively to each period in which the effect of the change in the U.S. federal corporate tax rate is recognized. The Company adopted ASU 2018-02 as of January 1, 2018, and a reclassification of $319,000, net, was recorded, which increased accumulated other comprehensive income and reduced retained earnings with the adoption of the accounting standard. Subsequent Events On October 16, 2018, the Company’s Board of Directors declared a cash dividend of $0.01 per share payable on November 5, 2018, to stockholders of record as of October 26, 2018; dividends of $298,000 were paid to stockholders on November 5, 2018.

Acquisitions

Acquisitions	9 Months Ended
	Sep. 30, 2018
Acquisitions
Acquisitions	Note 2 – Acquisitions On April 20, 2018, the Company acquired GCFC and its wholly owned subsidiary, ABC Bank, which operated four branches in the Chicago metro area. In addition to the acquisition price of $41.1 million, the Company retired the convertible and nonconvertible debentures held by GCFC upon acquisition, which totaled $6.6 million, including interest due. The purchase and the retirement of the debentures was funded with the Company’s cash on hand, and all GCFC common stock was retired and cancelled simultaneous with the close of the transaction. The Company acquired $227.6 million of loans, net of purchase accounting adjustments, and $248.5 million of deposits, net of purchase accounting adjustments for time deposits. Purchase accounting adjustments recorded in the second quarter of 2018 include a loan valuation mark of $11.2 million, a core deposit intangible of $3.1 million, a fixed asset valuation adjustment of $1.5 million, and goodwill of $9.9 million. In addition, a deferred tax asset of $3.5 million was recorded as of the date of acquisition based on analysis of the fair value of assets acquired, less liabilities assumed. None of the $9.9 million recorded as goodwill is expected to be deductible for tax purposes. Acquisition related costs incurred by the Company for the nine months ended September 30, 2018, totaled $3.3 million, pre-tax, and included $1.0 million of salaries and employee benefits related expenses, and $1.8 million of data processing, computer and ATM related conversion costs. The assets and liabilities associated with the acquisition of GCFC were recorded in the Consolidated Balance Sheets at their estimated fair values as of the acquisition date. In many cases the determination of these fair values required management to make estimates about discount rates, future expected cash flows, market conditions and other future events that are highly subjective in nature and subject to change, as noted below. The following table shows the estimated fair value of the assets acquired and liabilities assumed as of April 20, 2018. These fair value estimates are preliminary and subject to refinement for up to one year after the closing date of the acquisition or the date we receive the information about the facts and circumstances that existed at the acquisition date. Subsequent adjustments are, and if necessary, will be prospectively reflected in future filings, and may impact loans, other assets, deferred tax assets, net, and goodwill. The below table summarizes the assets acquired, less the liabilities assumed, related to the GCFC/ABC Bank acquisition. All amounts are listed at their estimated fair values as of date of acquisition, and have been accounted for under the acquisition method of accounting. GCFC/ABC Bank Acquisition Summary As of Date of Acquisition April 20, 2018 Assets Cash and due from banks $ 6,669 Interest bearing deposits with financial institutions 500 Securities available-for-sale, at fair value 72,091 Federal funds sold 4,300 FHLBC stock 1,549 Loans 227,594 Premises and equipment 5,339 Other real estate owned 401 Goodwill and core deposit intangible 12,966 Deferred tax assets, net 3,459 Other assets 1,925 Total assets $ 336,793 Liabilities Noninterest bearing demand $ 58,005 Savings, NOW and money market 91,494 Time 98,999 Total deposits 248,498 Securities sold under repurchase agreements 5,624 Other short-term borrowings 10,875 Notes payable and other borrowings 23,367 Other liabilities 1,249 Total liabilities 289,613 Cash consideration paid 47,180 Total Liabilities Assumed and Cash Consideration Paid for Acquisition $ 336,793 Loans acquired in the GCFC acquisition were initially recorded at fair value with no separate allowance for loan losses. The Company reviewed the loans at acquisition to determine which loans should be considered PCI loans, defining impaired loans as those that were either not accruing interest or exhibited credit risk factors consistent with nonperforming loans at the acquisition date, or non-PCI loans, as addressed in the Company’s significant accounting policies. The following table represents the acquired loans as of date of acquisition and as of September 30, 2018: April 20, 2018 September 30, 2018 ABC Bank Acquired Loans PCI Non-PCI PCI Non-PCI Fair Value $ 11,360 $ 216,306 $ 10,887 $ 201,289 Contractually required principal and interest payment 19,447 219,488 18,174 203,156 Best estimate of contractual cash flows not expected to be collected 6,537 2,511 6,069 1,457 Best estimate of contractual cash flows expected to be collected 12,910 216,977 12,105 201,699

Securities

Securities	9 Months Ended
	Sep. 30, 2018
Securities
Securities	Note 3 – Securities Investment Portfolio Management Our investment portfolio serves the liquidity needs and income objectives of the Company. While the portfolio serves as an important component of the overall liquidity management at the Bank, portions of the portfolio also serve as income producing assets. The size and composition of the portfolio reflects liquidity needs, loan demand and interest income objectives. Portfolio size and composition will be adjusted from time to time. While a significant portion of the portfolio consists of readily marketable securities to address liquidity, other parts of the portfolio may reflect funds invested pending future loan demand or to maximize interest income without undue interest rate risk. Investments are comprised of debt securities and non-marketable equity investments. Securities available-for-sale are carried at fair value. Unrealized gains and losses, net of tax, on securities available-for-sale are reported as a separate component of equity. This balance sheet component changes as interest rates and market conditions change. Unrealized gains and losses are not included in the calculation of regulatory capital. FHLBC and FRBC stock are considered nonmarketable equity investments. FHLBC stock was recorded at $4.3 million at September 30, 2018, and $5.4 million at December 31, 2017. FRBC stock was recorded at $6.2 million and $4.8 million at September 30, 2018, and December 31, 2017, respectively. The following table summarizes the amortized cost and fair value of the securities portfolio at September 30, 2018, and December 31, 2017, and the corresponding amounts of gross unrealized gains and losses: Gross Gross Amortized Unrealized Unrealized Fair September 30, 2018 Cost Gains Losses Value Securities available-for-sale U.S. Treasuries $ 4,005 $ - $ (151) $ 3,854 U.S. government agencies 11,881 - (178) 11,703 U.S. government agencies mortgage-backed 15,474 - (708) 14,766 States and political subdivisions 278,604 398 (6,738) 272,264 Collateralized mortgage obligations 67,762 118 (2,920) 64,960 Asset-backed securities 108,622 991 (440) 109,173 Collateralized loan obligations 65,555 162 (99) 65,618 Total securities available-for-sale $ 551,903 $ 1,669 $ (11,234) $ 542,338 Gross Gross Amortized Unrealized Unrealized Fair December 31, 2017 Cost Gains Losses Value Securities available-for-sale U.S. Treasury $ 4,002 $ - $ (55) $ 3,947 U.S. government agencies 13,062 8 (9) 13,061 U.S. government agencies mortgage-backed 12,372 7 (165) 12,214 States and political subdivisions 272,240 7,116 (1,264) 278,092 Corporate bonds 823 21 (11) 833 Collateralized mortgage obligations 66,892 202 (1,155) 65,939 Asset-backed securities 113,983 862 (1,913) 112,932 Collateralized loan obligations 54,271 251 (101) 54,421 Total securities available-for-sale $ 537,645 $ 8,467 $ (4,673) $ 541,439 The fair value, amortized cost and weighted average yield of debt securities at September 30, 2018, by contractual maturity, were as follows in the table below. Securities not due at a single maturity date are shown separately. Weighted Amortized Average Fair Securities available-for-sale Cost Yield Value Due in one year or less $ 1,500 4.78 % $ 1,502 Due after one year through five years 4,005 1.85 3,854 Due after five years through ten years 6,688 3.03 6,626 Due after ten years 282,297 3.00 275,839 294,490 3.00 287,821 Mortgage-backed and collateralized mortgage obligations 83,236 3.21 79,726 Asset-backed securities 108,622 3.22 109,173 Collateralized loan obligations 65,555 4.71 65,618 Total securities available-for-sale $ 551,903 3.28 % $ 542,338 At September 30, 2018, the Company’s investments included $92.6 million of asset-backed securities that are backed by student loans originated under the Federal Family Education Loan program (“FFEL”). Under the FFEL, private lenders made federally guaranteed student loans to parents and students. While the program was modified several times before elimination in 2010, FFEL securities are generally guaranteed by the U.S Department of Education (“DOE”) at not less than 97% of the outstanding principal amount of the loans. The guarantee will reduce to 85% if the DOE receives reimbursement requests in excess of 5% of insured loans; reimbursement will drop to 75% if reimbursement requests exceed 9% of insured loans. In addition to the DOE guarantee, total added credit enhancement in the form of overcollateralization and/or subordination amounted to $11.7 million, or 12.44% of outstanding principal. The Company has invested in securities issued from three originators that individually amount to over 10% of the Company’s stockholders equity. Information regarding these three issuers and the value of the securities issued follows: September 30, 2018 Amortized Fair Issuer Cost Value GCO Education Loan Funding Corp $ 27,711 $ 27,788 Towd Point Mortgage Trust 34,390 33,181 Student Loan Marketing Association 25,798 26,134 Securities with unrealized losses at September 30, 2018, and December 31, 2017, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, were as follows (in thousands except for number of securities): Less than 12 months 12 months or more September 30, 2018 in an unrealized loss position in an unrealized loss position Total Number of Unrealized Fair Number of Unrealized Fair Number of Unrealized Fair Securities available-for-sale Securities Losses Value Securities Losses Value Securities Losses Value U.S. Treasuries - $ - $ - 1 $ 151 $ 3,854 1 $ 151 $ 3,854 U.S. government agencies 3 109 7,829 1 69 3,874 4 178 11,703 U.S. government agencies mortgage-backed 6 287 7,357 7 421 7,409 13 708 14,766 States and political subdivisions 55 3,843 174,924 9 2,895 28,218 64 6,738 203,142 Collateralized mortgage obligations 4 714 25,620 8 2,206 33,342 12 2,920 58,962 Asset-backed securities 3 79 7,526 5 361 30,240 8 440 37,766 Collateralized loan obligations 4 85 24,502 1 14 7,986 5 99 32,488 Total securities available-for-sale 75 $ 5,117 $ 247,758 32 $ 6,117 $ 114,923 107 $ 11,234 $ 362,681 Less than 12 months 12 months or more December 31, 2017 in an unrealized loss position in an unrealized loss position Total Number of Unrealized Fair Number of Unrealized Fair Number of Unrealized Fair Securities available-for-sale Securities Losses Value Securities Losses Value Securities Losses Value U.S. Treasuries 1 $ 55 $ 3,947 - $ - $ - 1 $ 55 $ 3,947 U.S. government agencies 2 9 6,550 - - - 2 9 6,550 U.S. government agencies mortgage-backed 4 24 5,501 5 141 4,843 9 165 10,344 States and political subdivisions 13 1,237 45,985 1 27 1,512 14 1,264 47,497 Corporate bonds - - - 1 11 332 1 11 332 Collateralized mortgage obligations 3 31 11,534 8 1,124 40,219 11 1,155 51,753 Asset-backed securities - - - 7 1,913 61,745 7 1,913 61,745 Collateralized loan obligations 3 101 29,313 - - - 3 101 29,313 Total securities available-for-sale 26 $ 1,457 $ 102,830 22 $ 3,216 $ 108,651 48 $ 4,673 $ 211,481 Recognition of other-than-temporary impairment was not necessary as of the three and nine months ended September 30, 2018. The changes in fair value related primarily to interest rate fluctuations. Our review of other-than-temporary impairment determined that there was no credit quality deterioration. The following table presents net realized gains (losses) on securities available-for-sale for the three and nine months ended September 30, 2018 and 2017. Three Months Ended Nine Months Ended September 30, September 30, Securities available-for-sale 2018 2017 2018 2017 Proceeds from sales of securities $ 1,917 $ 51,620 $ 94,663 $ 152,476 Gross realized gains on securities 23 474 370 911 Gross realized losses on securities (10) (371) (10) (1,076) Securities realized gains (losses), net $ 13 $ 103 $ 360 $ (165) Income tax (expense) benefit on net realized gains (losses) (2) (42) (100) 24 The majority of the net realized losses in the prior year were incurred as the portfolio was repositioned during 2017 to invest in higher yielding tax exempt municipal securities. Securities valued at $311.2 million as of September 30, 2018, an increase from $301.0 million at year-end 2017, were pledged to secure deposits and borrowings, and for other purposes.

Loans

Loans	9 Months Ended
	Sep. 30, 2018
Loans
Loans	Note 4 – Loans Major classifications of loans were as follows: September 30, 2018 December 31, 2017 Commercial $ 306,407 $ 272,851 Leases 70,661 68,325 Real estate - commercial 804,184 750,991 Real estate - construction 112,873 85,162 Real estate - residential 393,598 313,397 Home equity lines of credit "HELOC" 122,022 112,833 Other 1 12,969 13,383 Total loans, excluding deferred loan costs and PCI loans 1,822,714 1,616,942 Net deferred loan costs 1,348 680 Total loans, excluding PCI loans 1,824,062 1,617,622 PCI loans, net of purchase accounting adjustments 10,887 - Total loans $ 1,834,949 $ 1,617,622 1 The “Other” class includes consumer and overdrafts. It is the policy of the Company to review each prospective credit prior to making a loan in order to determine if an adequate level of security or collateral has been obtained. The type of collateral, when required, will vary from liquid assets to real estate. The Company’s access to collateral, in the event of borrower default, is assured through adherence to lending laws, the Company’s lending standards and credit monitoring procedures. With selected exceptions, the Bank makes loans solely within its market area. There are no significant concentrations of loans where the customers’ ability to honor loan terms is dependent upon a single economic sector, although the real estate related categories listed above represent 78.1% and 78.0% of the portfolio at September 30, 2018, and December 31, 2017, respectively. Aged analysis of past due loans by class of loans was as follows: Recorded Investment 90 days or 90 Days or Greater Past 30-59 Days 60-89 Days Greater Past Total Past Due and September 30, 2018 Past Due Past Due Due Due Current Nonaccrual Total Loans Accruing Commercial $ 1,074 $ - $ 6 $ 1,080 $ 305,327 $ - $ 306,407 $ 6 Leases - - - - 70,661 - 70,661 - Real estate - commercial Owner occupied general purpose 1,022 - - 1,022 164,304 1,625 166,951 - Owner occupied special purpose 891 - - 891 188,984 410 190,285 - Non-owner occupied general purpose 346 3,422 - 3,768 293,979 142 297,889 - Non-owner occupied special purpose - - - - 85,171 3,099 88,270 - Retail properties 624 - - 624 46,252 - 46,876 - Farm 1,241 - - 1,241 12,672 - 13,913 - Real estate - construction Homebuilder - - - - 4,556 - 4,556 - Land - - - - 3,841 - 3,841 - Commercial speculative - - - - 56,052 - 56,052 - All other 38 - - 38 48,277 109 48,424 - Real estate - residential Investor 952 - - 952 70,102 364 71,418 - Multifamily 1,304 - 73 1,377 179,645 - 181,022 76 Owner occupied 780 136 - 916 136,678 3,564 141,158 - HELOC 1,422 92 - 1,514 119,880 628 122,022 - Other 1 42 1 - 43 14,234 40 14,317 - Total, excluding PCI loans $ 9,736 $ 3,651 $ 79 $ 13,466 $ 1,800,615 $ 9,981 $ 1,824,062 $ 82 PCI loans, net of purchase accounting adjustments 3,415 - - 3,415 5,174 2,298 10,887 - Total $ 13,151 $ 3,651 $ 79 $ 16,881 $ 1,805,789 $ 12,279 $ 1,834,949 $ 82 Recorded Investment 90 days or 90 Days or Greater Past 30-59 Days 60-89 Days Greater Past Total Past Due and December 31, 2017 Past Due Past Due Due Due Current Nonaccrual Total Loans Accruing Commercial $ 995 $ 275 $ - $ 1,270 $ 271,581 $ - $ 272,851 $ - Leases - - - - 68,147 178 68,325 - Real estate - commercial Owner occupied general purpose 1,136 - - 1,136 144,267 455 145,858 - Owner occupied special purpose 226 - - 226 170,546 342 171,114 - Non-owner occupied general purpose - 593 - 593 273,203 1,163 274,959 - Non-owner occupied special purpose - - 248 248 92,923 - 93,171 254 Retail properties - - - - 49,538 1,081 50,619 - Farm - - - - 15,270 - 15,270 - Real estate - construction Homebuilder 129 - - 129 2,221 - 2,350 - Land 1,124 - - 1,124 1,319 - 2,443 - Commercial speculative - - - - 32,028 - 32,028 - All other - - - - 48,140 201 48,341 - Real estate - residential Investor - - - - 55,248 372 55,620 - Multifamily - - - - 125,049 4,723 129,772 - Owner occupied 74 - - 74 123,257 4,674 128,005 - HELOC 491 278 - 769 110,872 1,192 112,833 - Other 1 37 - - 37 14,019 7 14,063 - Total $ 4,212 $ 1,146 $ 248 $ 5,606 $ 1,597,628 $ 14,388 $ 1,617,622 $ 254 1 The “Other” class includes consumer, overdrafts and net deferred costs. Credit Quality Indicators The Company categorizes loans into credit risk categories based on current financial information, overall debt service coverage, comparison against industry averages, historical payment experience, and current economic trends. This analysis includes loans with outstanding balances or commitments greater than $50,000 and excludes homogeneous loans such as home equity lines of credit and residential mortgages. Loans with a classified risk rating are reviewed quarterly regardless of size or loan type. The Company uses the following definitions for classified risk ratings: Special Mention. Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan at some future date. Substandard. Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected. Doubtful. Loans classified as doubtful have all the weaknesses inherent in those 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 values, highly questionable and improbable. Credits that are not covered by the definitions above are pass credits, which are not considered to be adversely rated. Credit Quality Indicators by class of loans were as follows: September 30, 2018 Special Pass Mention Substandard 2 Doubtful Total Commercial $ 303,176 $ 2,878 $ 353 $ - $ 306,407 Leases 70,661 - - - 70,661 Real estate - commercial Owner occupied general purpose 160,999 1,489 4,463 - 166,951 Owner occupied special purpose 183,375 2,883 4,027 - 190,285 Non-owner occupied general purpose 289,438 834 7,617 - 297,889 Non-owner occupied special purpose 83,648 1,523 3,099 - 88,270 Retail Properties 45,074 - 1,802 - 46,876 Farm 11,423 1,249 1,241 - 13,913 Real estate - construction Homebuilder 4,556 - - - 4,556 Land 3,841 - - - 3,841 Commercial speculative 56,052 - - - 56,052 All other 46,152 1,990 282 - 48,424 Real estate - residential Investor 70,315 - 1,103 - 71,418 Multifamily 177,845 - 3,177 - 181,022 Owner occupied 135,625 511 5,022 - 141,158 HELOC 120,193 - 1,829 - 122,022 Other 1 14,262 - 55 - 14,317 Total, excluding PCI loans $ 1,776,635 $ 13,357 $ 34,070 $ - $ 1,824,062 PCI loans, net of purchase accounting adjustments - - 10,887 - 10,887 Total $ 1,776,635 $ 13,357 $ 44,957 $ - $ 1,834,949 December 31, 2017 Special Pass Mention Substandard 2 Doubtful Total Commercial $ 270,889 $ 1,962 $ - $ - $ 272,851 Leases 67,500 - 825 - 68,325 Real estate - commercial Owner occupied general purpose 142,843 1,927 1,088 - 145,858 Owner occupied special purpose 169,621 1,152 341 - 171,114 Non-owner occupied general purpose 271,731 2,065 1,163 - 274,959 Non-owner occupied special purpose 89,582 - 3,589 - 93,171 Retail Properties 48,321 1,217 1,081 - 50,619 Farm 11,755 1,029 2,486 - 15,270 Real estate - construction Homebuilder 2,350 - - - 2,350 Land 2,443 - - - 2,443 Commercial speculative 32,028 - - - 32,028 All other 46,913 1,052 376 - 48,341 Real estate - residential Investor 55,172 - 448 - 55,620 Multifamily 125,049 - 4,723 - 129,772 Owner occupied 122,178 561 5,266 - 128,005 HELOC 110,934 - 1,899 - 112,833 Other 1 14,043 - 20 - 14,063 Total $ 1,583,352 $ 10,965 $ 23,305 $ - $ 1,617,622 1 The “Other” class includes consumer, overdrafts and net deferred costs. 2 The substandard credit quality indicator includes both potential problem loans that are currently performing and nonperforming loans. The Company had $1.0 million and $1.3 million in residential real estate loans in the process of foreclosure as of September 30, 2018, and December 31, 2017, respectively. The following tables set forth the recorded investments, unpaid principal balance and related allowance, excluding purchased credit-impaired loans, by class of loans for the three and nine months ended September 30, 2018: Three Months Ended Nine Months Ended As of September 30, 2018 September 30, 2018 September 30, 2018 Unpaid Average Interest Average Interest Recorded Principal Related Recorded Income Recorded Income Investment Balance Allowance Investment Recognized Investment Recognized With no related allowance recorded Commercial $ - $ - $ - $ - $ - $ - $ - Leases - - - - - - - Commercial real estate Owner occupied general purpose 1,614 1,699 - 1,263 2 1,035 5 Owner occupied special purpose 409 538 - 417 - 375 - Non-owner occupied general purpose 142 158 - 91 - 653 - Non-owner occupied special purpose - - - - - - - Retail properties - - - - - - - Farm - - - - - - - Construction Homebuilder - - - - - - - Land - - - - - - - Commercial speculative - - - - - - - All other 50 74 - 121 - 125 - Residential Investor 365 466 - 368 - 369 - Multifamily - - - - - 2,361 - Owner occupied 3,855 5,326 - 4,050 11 4,532 29 HELOC 634 739 - 687 - 880 1 Other 1 14 15 - 15 - 10 - Total impaired loans with no recorded allowance 7,083 9,015 - 7,012 13 10,340 35 With an allowance recorded Commercial - - - - - - - Leases - - - - - - - Commercial real estate Owner occupied general purpose 518 518 46 259 22 259 22 Owner occupied special purpose - - - - - - - Non-owner occupied general purpose - - - - - - - Non-owner occupied special purpose 3,099 3,575 139 3,099 - 1,550 - Retail properties - - - - - - - Farm - - - - - - - Construction Homebuilder - - - - - - - Land - - - - - - - Commercial speculative - - - - - - - All other 59 59 42 30 - 29 - Residential Investor 810 810 10 812 11 820 33 Multifamily - - - - - - - Owner occupied 3,710 3,710 49 3,678 35 3,576 108 HELOC 1,420 1,420 61 1,371 17 1,203 41 Other 1 26 26 26 14 - 13 - Total impaired loans with a recorded allowance 9,642 10,118 373 9,263 85 7,450 204 Total impaired loans $ 16,725 $ 19,133 $ 373 $ 16,275 $ 98 $ 17,790 $ 239 1 The “Other” class includes consumer, overdrafts and net deferred costs. Impaired loans by class of loans as of December 31, 2017, and for the three and nine months ended September 30, 2017, were as follows: Three Months Ended Nine Months Ended As of December 31, 2017 September 30, 2017 September 30, 2017 Unpaid Average Interest Average Interest Recorded Principal Related Recorded Income Recorded Income Investment Balance Allowance Investment Recognized Investment Recognized With no related allowance recorded Commercial $ - $ - $ - $ 212 $ - $ 123 $ - Leases 178 213 - 208 - 281 - Commercial real estate Owner occupied general purpose 455 495 - 458 - 1,169 - Owner occupied special purpose 342 498 - 363 - 372 - Non-owner occupied general purpose 1,163 1,538 - 1,180 1 1,481 2 Non-owner occupied special purpose - - - - - 507 - Retail properties 1,081 1,177 - 1,129 - 1,146 - Farm - - - - - - - Construction Homebuilder - - - - - - - Land - - - - - - - Commercial speculative - - - 34 - 37 - All other 201 229 - 178 - 206 - Residential Investor 372 676 - 1,475 16 1,607 36 Multifamily 4,723 4,965 - 4,791 - 2,379 - Owner occupied 5,208 6,680 - 8,179 54 8,987 119 HELOC 1,125 1,313 - 1,981 12 2,237 27 Other 1 7 8 - 9 - 104 - Total impaired loans with no recorded allowance 14,855 17,792 - 20,197 83 20,636 184 With an allowance recorded Commercial - - - - - - - Leases - - - 120 - - - Commercial real estate Owner occupied general purpose - - - - - - - Owner occupied special purpose - - - - - - - Non-owner occupied general purpose - - - - - 123 - Non-owner occupied special purpose - - - - - - - Retail properties - - - - - - - Farm - - - - - - - Construction Homebuilder - - - - - - - Land - - - - - - - Commercial speculative - - - - - - - All other - - - - - - - Residential Investor 829 829 10 - - - - Multifamily - - - - - - - Owner occupied 3,443 3,443 43 - - 402 - HELOC 985 985 91 25 2 26 2 Other 1 - - - - - - - Total impaired loans with a recorded allowance 5,257 5,257 144 145 2 551 2 Total impaired loans $ 20,112 $ 23,049 $ 144 $ 20,342 $ 85 $ 21,187 $ 186 1 The “Other” class includes consumer, overdrafts and net deferred costs. Troubled debt restructurings (“TDRs”) are loans for which the contractual terms have been modified and both of these conditions exist: (1) there is a concession to the borrower and (2) the borrower is experiencing financial difficulties. Loans are restructured on a case-by-case basis during the loan collection process with modifications generally initiated at the request of the borrower. These modifications may include reduction in interest rates, extension of term, deferrals of principal, and other modifications. The Bank participates in the U.S. Department of the Treasury’s (the “Treasury”) Home Affordable Modification Program (“HAMP”) which gives qualifying homeowners an opportunity to refinance into more affordable monthly payments. The specific allocation of the allowance for loan and lease losses for TDRs is determined by calculating the present value of the TDR cash flows by discounting the original payment less an assumption for probability of default at the original note’s issue rate, and adding this amount to the present value of collateral less selling costs. If the resulting amount is less than the recorded book value, the Bank either establishes a valuation allowance (i.e., specific reserve) as a component of the allowance for loan and lease losses or charges off the impaired balance if it determines that such amount is a confirmed loss. This method is used consistently for all segments of the portfolio. The allowance for loan and lease losses also includes an allowance based on a loss migration analysis for each loan category on loans and leases that are not individually evaluated for specific impairment. All loans charged-off, including TDRs charged-off, are factored into this calculation by portfolio segment. TDRs that were modified during the period are as follows: TDR Modifications TDR Modifications Three Months Ended September 30, 2018 Nine Months Ended September 30, 2018 # of Pre-modification Post-modification # of Pre-modification Post-modification contracts recorded investment recorded investment contracts recorded investment recorded investment Troubled debt restructurings Real estate - commercial Owner occupied general purpose Other 1 1 $ 427 $ 424 1 $ 427 $ 424 Owner occupied special purpose Other 1 - - - 1 110 52 Real estate - residential Owner occupied HAMP 2 1 211 211 3 383 331 Other 1 1 34 29 1 34 29 HELOC HAMP 2 1 26 26 1 26 26 Rate 3 1 24 24 Other 1 2 93 92 9 596 587 Total 6 $ 791 $ 782 17 $ 1,600 $ 1,473 TDR Modifications TDR Modifications Three Months Ended September 30, 2017 Nine Months Ended September 30, 2017 # of Pre-modification Post-modification # of Pre-modification Post-modification contracts recorded investment recorded investment contracts recorded investment recorded investment Troubled debt restructurings HELOC Other 1 2 $ 155 $ 147 6 $ 399 $ 388 Total 2 $ 155 $ 147 6 $ 399 $ 388 1 Other: Change of terms from bankruptcy court. 2 HAMP: Home Affordable Modification Program. 3 Rate: Refers to interest rate reduction. TDRs are classified as being in default on a case-by-case basis when they fail to be in compliance with the modified terms. There was no TDR default activity for the periods ended September 30, 2018 and September 30, 2017, for loans that were restructured within the 12 month period prior to default. The following table details the accretable discount on all of the Company’s purchased loans, both non-PCI loans and PCI loans as of September 30, 2018. Accretable Discount - Non-PCI Loans Accretable Discount - PCI Loans Non-Accretable Discount - PCI Loans Total Beginning balance, July 1, 2018 $ 2,995 $ 1,373 $ 6,403 $ 10,771 Purchases - - - - Accretion (312) (129) (334) (775) Transfer 1 (373) (26) - (399) Ending balance, September 30, 2018 $ 2,310 $ 1,218 $ 6,069 $ 9,597 1 Transfer was due to loans moved to OREO.

Allowance for Loan Losses

Allowance for Loan Losses	9 Months Ended
	Sep. 30, 2018
Allowance for Loan Losses
Allowance for Loan Losses	Note 5 – Allowance for Loan and Lease Losses Changes in the allowance for loan and lease losses by segment of loans based on method of impairment for the three and nine months ended September 30, 2018, were as follows: Real Estate Real Estate Real Estate Allowance for loan and lease losses: Commercial Leases Commercial Construction Residential HELOC Other 1 Total Three months ended September 30, 2018 Beginning balance $ 2,676 $ 634 $ 10,537 $ 1,398 $ 1,818 $ 1,390 $ 868 $ 19,321 Charge-offs 7 - 201 - - 49 115 372 Recoveries 32 - 37 32 83 139 56 379 Provision (Release) 96 31 (144) (374) 67 (372) 696 - Ending balance $ 2,797 $ 665 $ 10,229 $ 1,056 $ 1,968 $ 1,108 $ 1,505 $ 19,328 Nine months ended September 30, 2018 Beginning balance $ 2,453 $ 692 $ 9,522 $ 923 $ 1,846 $ 1,446 $ 579 $ 17,461 Charge-offs 38 13 609 (16) (55) 141 316 1,046 Recoveries 141 - 425 35 1,099 277 208 2,185 Provision (Release) 241 (14) 891 82 (1,032) (474) 1,034 728 Ending balance $ 2,797 $ 665 $ 10,229 $ 1,056 $ 1,968 $ 1,108 $ 1,505 $ 19,328 Ending balance: Individually evaluated for impairment $ - $ - $ 185 $ 42 $ 59 $ 61 $ 26 $ 373 Ending balance: Collectively evaluated for impairment 2,797 665 10,044 1,014 1,909 1,047 1,479 18,955 Ending balance: Acquired and accounted for ASC 310-30 - - - - - - - - Total ending allowance balance $ 2,797 $ 665 $ 10,229 $ 1,056 $ 1,968 $ 1,108 $ 1,505 $ 19,328 Loans: Ending balance: Individually evaluated for Impairment $ - $ - $ 5,782 $ 109 $ 8,740 $ 2,054 $ 40 $ 16,725 Ending balance: Collectively evaluated for impairment 306,407 70,661 798,402 112,764 384,858 119,968 14,277 1,807,337 Ending balance: Acquired and accounted for ASC 310-30 - - 4,126 778 5,983 - - 10,887 Total ending loans balance $ 306,407 $ 70,661 $ 808,310 $ 113,651 $ 399,581 $ 122,022 $ 14,317 $ 1,834,949 1 The “Other” class includes consumer, overdrafts and net deferred costs. Changes in the allowance for loan and lease losses by segment of loans based on method of impairment for the three and nine months ended September 30, 2017, were as follows: Allowance for loan and lease losses: Commercial Leases Commercial Construction Residential HELOC Other 1 Total Three months ended September 30, 2017 Beginning balance $ 2,150 $ 791 $ 8,107 $ 857 $ 1,872 $ 1,513 $ 546 $ 15,836 Charge-offs 13 98 22 19 5 2 82 241 Recoveries 6 - 43 11 90 369 51 570 (Release) Provision (104) 77 505 165 (187) (455) 299 300 Ending balance $ 2,039 $ 770 $ 8,633 $ 1,014 $ 1,770 $ 1,425 $ 814 $ 16,465 Nine months ended September 30, 2017 Beginning balance $ 1,629 $ 633 $ 9,547 $ 389 $ 2,178 $ 1,331 $ 451 $ 16,158 Charge-offs 20 215 300 23 982 196 262 1,998 Recoveries 13 - 124 89 243 607 179 1,255 Provision (Release) 417 352 (738) 559 331 (317) 446 1,050 Ending balance $ 2,039 $ 770 $ 8,633 $ 1,014 $ 1,770 $ 1,425 $ 814 $ 16,465 Ending balance: Individually evaluated for impairment $ - $ - $ - $ - $ 6 $ - $ - $ 6 Ending balance: Collectively evaluated for impairment 2,039 770 8,633 1,014 1,764 1,425 814 16,459 Total ending allowance balance $ 2,039 $ 770 $ 8,633 $ 1,014 $ 1,770 $ 1,425 $ 814 $ 16,465 Loans: Ending balance: Individually evaluated for impairment $ 207 $ 196 $ 3,147 $ 205 $ 14,281 $ 2,042 $ 8 $ 20,086 Ending balance: Collectively evaluated for impairment 257,149 69,109 735,989 94,663 288,799 114,461 13,935 1,574,105 Total ending loan balance $ 257,356 $ 69,305 $ 739,136 $ 94,868 $ 303,080 $ 116,503 $ 13,943 $ 1,594,191

Other Real Estate Owned

Other Real Estate Owned	9 Months Ended
	Sep. 30, 2018
Other Real Estate Owned
Other Real Estate Owned	Note 6 – Other Real Estate Owned Details related to the activity in the other real estate owned (“OREO”) portfolio, net of valuation reserve, for the periods presented are itemized in the following table: Three Months Ended Nine Months Ended September 30, September 30, Other real estate owned 2018 2017 2018 2017 Balance at beginning of period $ 8,912 $ 11,724 $ 8,371 $ 11,916 Property additions, net of acquisition adjustments (217) 176 2,595 3,796 Property improvements - - 59 - Less: Proceeds from property disposals, net of participation purchase and of gains/losses 1,612 1,956 3,576 5,058 Period valuation adjustments 119 920 485 1,630 Balance at end of period $ 6,964 $ 9,024 $ 6,964 $ 9,024 Activity in the valuation allowance was as follows: Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Balance at beginning of period $ 8,348 $ 8,304 $ 8,208 $ 9,982 Provision for unrealized losses 119 920 485 1,630 Reductions taken on sales (456) (421) (682) (2,809) Other adjustments - - - - Balance at end of period $ 8,011 $ 8,803 $ 8,011 $ 8,803 Expenses related to OREO, net of lease revenue includes: Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Gain on sales, net $ (612) $ (276) $ (716) $ (454) Provision for unrealized losses 119 920 485 1,630 Operating expenses 133 221 502 1,037 Less: Lease revenue 10 185 39 285 Net OREO expense $ (370) $ 680 $ 232 $ 1,928

Deposits

Deposits	9 Months Ended
	Sep. 30, 2018
Deposits
Deposits	Note 7 – Deposits Major classifications of deposits were as follows: September 30, 2018 December 31, 2017 Noninterest bearing demand $ 621,580 $ 572,404 Savings 298,073 262,220 NOW accounts 437,361 429,448 Money market accounts 310,452 276,082 Certificates of deposit of less than $100,000 235,272 216,493 Certificates of deposit of $100,000 through $250,000 163,716 122,489 Certificates of deposit of more than $250,000 65,916 43,789 Total deposits $ 2,132,370 $ 1,922,925

Borrowings

Borrowings	9 Months Ended
	Sep. 30, 2018
Borrowings
Borrowings	Note 8 – Borrowings The following table is a summary of borrowings as of September 30, 2018, and December 31, 2017. Junior subordinated debentures are discussed in detail in Note 9: September 30, 2018 December 31, 2017 Securities sold under repurchase agreements $ 44,333 $ 29,918 Other short-term borrowings 1 81,875 115,000 Junior subordinated debentures 57,674 57,639 Senior notes 44,133 44,058 Notes payable and other borrowings 18,050 - Total borrowings $ 246,065 $ 246,615 1 Includes short-term FHLBC advances and the outstanding portion of an operating line of credit. The Company enters into deposit sweep transactions where the transaction amounts are secured by pledged securities. These transactions consistently mature overnight from the transaction date and are governed by sweep repurchase agreements. All sweep repurchase agreements are treated as financings secured by U.S. government agencies and collateralized mortgage-backed securities and had a carrying amount of $44.3 million at September 30, 2018, and $29.9 million at December 31, 2017. The fair value of the pledged collateral was $72.6 million at September 30, 2018 and $40.0 million at December 31, 2017. At September 30, 2018, there were no customers with secured balances exceeding 10% of stockholders’ equity. The Company’s borrowings at the FHLBC require the Bank to be a member and invest in the stock of the FHLBC. Total borrowings are generally limited to the lower of 35% of total assets or 60% of the book value of certain mortgage loans. As of September 30, 2018, the Bank had $77.9 million in short-term advances outstanding under the FHLBC compared to $115.0 million outstanding as of December 31, 2017; $65.0 million of the September 30, 2018, balance was issued at 2.22%, and $5.0 million was issued at 2.24%. The additional $4.0 million in other short-term borrowings as of September 30, 2018, was the outstanding portion of a $20.0 million line of credit the Company has with a correspondent bank for short-term funding needs, paying 3.85% as of the current quarter end; advances under the line can be outstanding up to 360 days from date of issuance. The Bank also assumed $23.5 million of long-term FHLBC advances with the ABC Bank acquisition. At September 30, 2018, these advances have a total outstanding balance of $18.1 million and are scheduled to mature over the next 7.5 years with interest rates ranging between 1.40% to 2.83 %. FHLBC stock held was valued at $4.3 million, and any potential FHLBC advances were collateralized by securities with a fair value of $77.3 million and loans with a principal balance of $304.2 million, which carried a FHLBC calculated combined collateral value of $303.3 million. The Company had excess collateral of $133.0 million available to secure borrowings at September 30, 2018. The Company also has $44.1 million of senior notes outstanding, net of deferred issuance costs, as of September 30, 2018 and December 31, 2017. The senior notes mature in ten years, and terms include interest payable semiannually at 5.75% for five years. Beginning December 2021, the senior debt will pay interest at a floating rate, with interest payable quarterly at three month LIBOR plus 385 basis points. The notes are redeemable, in whole or in part, at the option of the Company, beginning with the interest payment date on December 31, 2021, and on any floating rate interest payment date thereafter, at a redemption price equal to 100% of the principal amount of the notes plus accrued and unpaid interest. As of September 30, 2018 and December 31, 2017, unamortized debt issuance costs related to the senior notes were $867,000 and $942,000, respectively, and are included as a reduction of the balance of the senior notes on the Consolidated Balance Sheet. These deferred issuance costs will be amortized to interest expense over the ten year term of the notes and are included in the Consolidated Statements of Income.

Junior Subordinated Debentures

Junior Subordinated Debentures	9 Months Ended
	Sep. 30, 2018
Junior Subordinated Debentures.
Junior Subordinated Debentures	Note 9 – Junior Subordinated Debentures The Company completed the sale of $27.5 million of cumulative trust preferred securities by its unconsolidated subsidiary, Old Second Capital Trust I, in June 2003. An additional $4.1 million of cumulative trust preferred securities were sold in July 2003. The trust preferred securities may remain outstanding for a 30-year term but, subject to regulatory approval, can be called in whole or in part by the Company after June 30, 2008. When not in deferral, distributions on the securities are payable quarterly at an annual rate of 7.80%. The Company issued a new $32.6 million subordinated debenture to Old Second Capital Trust I in return for the aggregate net proceeds of this trust preferred offering. The interest rate and payment frequency on the debenture are equivalent to the cash distribution basis on the trust preferred securities. The Company issued an additional $25.0 million of cumulative trust preferred securities through a private placement completed by an additional, unconsolidated subsidiary, Old Second Capital Trust II, in April 2007. These trust preferred securities also mature in 30 years, but subject to the aforementioned regulatory approval, can be called in whole or in part on a quarterly basis commencing June 15, 2017. The quarterly cash distributions on the securities were fixed at 6.77% through June 15, 2017, and float at 150 basis points over three-month LIBOR thereafter. Upon conversion to a floating rate, a cash flow hedge was initiated which resulted in the total interest rate paid on the debt of 4.34% as of September 30, 2018, compared to the rate paid prior to June 15, 2017 of 6.77%. The Company issued a new $25.8 million subordinated debenture to Old Second Capital Trust II in return for the aggregate net proceeds of this trust preferred offering. The interest rate and payment frequency on the debenture are equivalent to the cash distribution basis on the trust preferred securities. Both of the debentures issued by the Company are disclosed on the Consolidated Balance Sheet as junior subordinated debentures and the related interest expense for each issuance is included in the Consolidated Statements of Income. As of September 30, 2018, and December 31, 2017, unamortized debt issuance costs related to the junior subordinated debentures were $704,000 and $739,000 respectively, and are included as a reduction to the balance of the junior subordinated debentures on the Consolidated Balance Sheet. These deferred issuance costs will be amortized to interest expense over the 30-year term of the notes and are included in the Consolidated Statements of Income.

Equity Compensation Plans

Equity Compensation Plans	9 Months Ended
	Sep. 30, 2018
Equity Compensation Plans
Equity Compensation Plans	Note 10 – Equity Compensation Plans Stock-based awards are outstanding under the Company’s 2008 Equity Incentive Plan (the “2008 Plan”) and the Company’s 2014 Equity Incentive Plan, as amended (the “2014 Plan,” and together with the 2008 Plan, the “Plans”). The 2014 Plan was approved at the 2014 annual meeting of stockholders; a maximum of 375,000 shares were authorized to be issued under this plan. Following approval of the 2014 Plan, no further awards will be granted under the 2008 Plan or any other Company equity compensation plan. At the May 2016 annual stockholders meeting, an amendment to the 2014 Plan authorized an additional 600,000 shares to be issued, which resulted in a total of 975,000 shares authorized for issuance under this plan. The 2014 Plan authorizes the granting of qualified stock options, non-qualified stock options, restricted stock, restricted stock units, and stock appreciation rights. Awards may be granted to selected directors and officers or employees under the 2014 Plan at the discretion of the Compensation Committee of the Company’s Board of Directors. As of September 30, 2018, 169,791 shares remained available for issuance under the 2014 Plan. There were no stock options granted or exercised in the nine months ended September 30, 2018 and 2017. All stock options are granted for a term of ten years. There is no unrecognized compensation cost related to unvested stock options as all stock options of the Company’s common stock have fully vested. A summary of stock option activity in the Plans for the nine months ended September 30, 2018, is as follows: Weighted- Weighted Average Average Remaining Exercise Contractual Aggregate Shares Price Term (years) Intrinsic Value Beginning outstanding 9,000 $ 7.49 - - Canceled - - - - Expired - - - - Ending outstanding 9,000 $ 7.49 0.4 $ 72 Exercisable at end of period 9,000 $ 7.49 0.4 $ 72 Generally, restricted stock and restricted stock units granted under the Plans vest three years from the grant date, but the Compensation Committee of the Company’s Board of Directors has discretionary authority to change some terms including the amount of time until the vest date. Awards under the 2008 Plan will become fully vested upon a merger or change in control of the Company. Under the 2014 Plan, upon a change in control of the Company, if (i) the 2014 Plan is not an obligation of the successor entity following the change in control, or (ii) the 2014 Plan is an obligation of the successor entity following the change in control and the participant incurs an involuntary termination, then the stock options, stock appreciation rights, stock awards and cash incentive awards under the 2014 Plan will become fully exercisable and vested. Performance-based awards generally will vest based upon the level of achievement of the applicable performance measures through the change in control. The Company granted restricted stock under its equity compensation plans beginning in 2005 and it began granting restricted stock units in February 2009. Awards of restricted stock under the Plans generally entitle holders to voting and dividend rights upon grant and are subject to forfeiture until certain restrictions have lapsed including employment for a specific period. Awards of restricted stock units under the Plans are also subject to forfeiture until certain restrictions have lapsed including employment for a specific period, but do not entitle holders to voting rights until the restricted period ends and shares are transferred in connection with the units. There were 254,281 restricted stock units issued under the 2014 Plan during the nine months ended September 30, 2018, which included 140,000 units granted under a new performance restricted stock unit agreement for select officers and all directors. The performance period covers January 1, 2018 through December 31, 2020, and vesting will be based upon the achievement of certain key Company performance metrics, such as total shareholder returns, earnings, and corporate efficiencies. There were 161,500 restricted stock units issued during the nine months ended September 30, 2017. Compensation expense is recognized over the vesting period of the restricted stock unit based on the market value of the award on the issue date. Total compensation cost that has been recorded for the 2014 Plan was $1.7 million and $925,000 in the first nine months of 2018 and 2017, respectively. A summary of changes in the Company’s unvested restricted awards for the nine months ended September 30, 2018, is as follows: September 30, 2018 Weighted Restricted Average Stock Shares Grant Date and Units Fair Value Unvested at January 1 465,000 $ 7.79 Granted 254,281 13.98 Vested (155,500) 5.14 Forfeited - - Unvested at September 30 563,781 $ 11.31 Total unrecognized compensation cost of restricted awards was $3.6 million as of September 30, 2018, which is expected to be recognized over a weighted-average period of 2.01 years.

Earnings Per Share

Earnings Per Share	9 Months Ended
	Sep. 30, 2018
Earnings Per Share
Earnings Per Share	Note 11 – Earnings Per Share The earnings per share – both basic and diluted – are included below as of September 30 (in thousands except for share and per share data): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Basic earnings per share: Weighted-average common shares outstanding 29,747,078 29,627,086 29,718,191 29,591,811 Net income $ 9,642 $ 8,077 $ 25,392 $ 17,650 Basic earnings per share $ 0.32 $ 0.27 $ 0.85 $ 0.60 Diluted earnings per share: Weighted-average common shares outstanding 29,747,078 29,627,086 29,718,191 29,591,811 Dilutive effect of unvested restricted awards 1 563,781 473,967 525,627 425,081 Dilutive effect of stock options and warrants 73,032 2,556 53,476 2,473 Diluted average common shares outstanding 30,383,891 30,103,609 30,297,294 30,019,365 Net Income $ 9,642 $ 8,077 $ 25,392 $ 17,650 Diluted earnings per share $ 0.32 $ 0.27 $ 0.84 $ 0.59 Number of antidilutive options and warrants excluded from the diluted earnings per share calculation - 900,839 - 900,839 1 Includes the common stock equivalents for restricted share rights that are dilutive . The above earnings per share calculation also includes a warrant for 815,339 shares of common stock, at an exercise price of $13.43 per share, that was outstanding as of September 30, 2018, and is considered dilutive. The same warrant was not included as of September 30, 2017, because the warrant was anti-dilutive. The ten-year warrant was issued in 2009, and was sold at auction by the U.S. Treasury in June 2013 to a third party investor.

Regulatory & Capital Matters

Regulatory & Capital Matters	9 Months Ended
	Sep. 30, 2018
Regulatory & Capital Matters
Regulatory & Capital Matters	Note 12 – Regulatory & Capital Matters The Bank is subject to the risk-based capital regulatory guidelines, which include the methodology for calculating the risk-weighted Bank assets, developed by the Office of the Comptroller of the Currency (the “OCC”) and the other bank regulatory agencies. In connection with the current economic environment, the Bank’s current level of nonperforming assets and the risk-based capital guidelines, the Bank’s Board of Directors has determined that the Bank should maintain a Tier 1 leverage capital ratio at or above eight percent (8%) and a total risk-based capital ratio at or above twelve percent (12%). At September 30, 2018, the Bank exceeded those thresholds. At September 30, 2018, the Bank’s Tier 1 capital leverage ratio was 11.05%, an increase of 26 basis points from December 31, 2017, and is well above the 8.00% objective. The Bank’s total capital ratio was 14.16%, an increase of 38 basis points from December 31, 2017, and also well above the objective of 12.00%. Bank holding companies are required to maintain minimum levels of capital in accordance with capital guidelines implemented by the Board of Governors of the Federal Reserve System. The general bank and holding company capital adequacy guidelines are shown in the accompanying table, as are the capital ratios of the Company and the Bank, as of September 30, 2018 and December 31, 2017. In July 2013, the U.S. federal banking authorities issued final rules (the “Basel III Rules”) establishing more stringent regulatory capital requirements for U.S. banking institutions, which went into effect on January 1, 2015. A detailed discussion of the Basel III Rules is included in Part I, Item 1 of the Company’s Form 10-K for the year ended December 31, 2017, under the heading “Supervision and Regulation.” At September 30, 2018, and December 31, 2017, the Company, on a consolidated basis, exceeded the minimum thresholds to be considered “well capitalized” under current regulatory defined capital ratios. Capital levels and industry defined regulatory minimum required levels are as follows: Minimum Capital To Be Well Capitalized Under Adequacy with Capital Prompt Corrective Actual Conservation Buffer if applicable 1 Action Provisions 2 Amount Ratio Amount Ratio Amount Ratio September 30, 2018 Common equity tier 1 capital to risk weighted assets Consolidated $ 196,632 9.12 % $ 137,448 6.375 % N/A N/A Old Second Bank 285,010 13.26 137,024 6.375 $ 139,711 6.50 % Total capital to risk weighted assets Consolidated 270,976 12.57 212,879 9.875 N/A N/A Old Second Bank 304,333 14.16 212,238 9.875 214,924 10.00 Tier 1 capital to risk weighted assets Consolidated 251,653 11.67 169,817 7.875 N/A N/A Old Second Bank 285,010 13.26 169,265 7.875 171,952 8.00 Tier 1 capital to average assets Consolidated 251,653 9.72 103,561 4.00 N/A N/A Old Second Bank 285,010 11.05 103,171 4.00 128,964 5.00 December 31, 2017 Common equity tier 1 capital to risk weighted assets Consolidated $ 179,853 9.25 % $ 111,801 5.750 % N/A N/A Old Second Bank 249,417 12.88 111,347 5.750 $ 125,870 6.50 % Total capital to risk weighted assets Consolidated 251,383 12.93 179,837 9.250 N/A N/A Old Second Bank 266,873 13.78 179,142 9.250 193,667 10.00 Tier 1 capital to risk weighted assets Consolidated 233,927 12.03 140,978 7.250 N/A N/A Old Second Bank 249,417 12.88 140,394 7.250 154,917 8.00 Tier 1 capital to average assets Consolidated 233,927 10.08 92,828 4.00 N/A N/A Old Second Bank 249,417 10.79 92,462 4.00 115,578 5.00 1 As of September 30, 2018, amounts are shown inclusive of a capital conservation buffer of 1.875%; as compared to December 31, 2017, of 1.25%. 2 The Bank exceeded the general minimum regulatory requirements to be considered “well capitalized.” Dividend Restrictions In addition to the above requirements, banking regulations and capital guidelines generally limit the amount of dividends that may be paid by a bank without prior regulatory approval. Under these regulations, the amount of dividends that may be paid in any calendar year is limited to the current year’s profits, combined with the retained profit of the previous two years, subject to the capital requirements described above. Pursuant to the Basel III rules that came into effect January 1, 2015, the Bank must keep a buffer of 0.625% for 2016, 1.25% for 2017, 1.875% for 2018, and 2.5% for 2019 and thereafter of minimum capital requirements in order to avoid additional limitations on capital distributions and certain other payments.

Fair Value Measurements

Fair Value Measurements	9 Months Ended
	Sep. 30, 2018
Fair Value Measurements
Fair Value Measurements	Note 13 – Fair Value Measurements Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value hierarchy established by the Company also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Three levels of inputs that may be used to measure fair value are: Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the Company has the ability to access as of the measurement date. Level 2: Significant observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, and other inputs that are observable or can be corroborated by observable market data. Level 3: Significant unobservable inputs that reflect a company’s own view about the assumptions that market participants would use in pricing an asset or liability. The majority of securities available-for-sale are valued by external pricing services or dealer market participants and are classified in Level 2 of the fair value hierarchy. Both market and income valuation approaches are utilized. Quarterly, the Company evaluates the methodologies used by the external pricing services or dealer market participants to develop the fair values to determine whether the results of the valuations are representative of an exit price in the Company’s principal markets and an appropriate representation of fair value. The Company uses the following methods and significant assumptions to estimate fair value: · Government-sponsored agency debt securities are primarily priced using available market information through processes such as benchmark spreads, market valuations of like securities, like securities groupings and matrix pricing. · Other government-sponsored agency securities, MBS and some of the actively traded real estate mortgage investment conduits and collateralized mortgage obligations are priced using available market information including benchmark yields, prepayment speeds, spreads, volatility of similar securities and trade date. · State and political subdivisions are largely grouped by characteristics (e.g., geographical data and source of revenue in trade dissemination systems). Because some securities are not traded daily and due to other grouping limitations, active market quotes are often obtained using benchmarking for like securities. · Auction rate securities are priced using market spreads, cash flows, prepayment speeds, and loss analytics. Therefore, the valuations of auction rate asset-backed securities are considered Level 2 valuations. · Asset-backed collateralized loan obligations were priced using data from a pricing matrix supported by our bond accounting service provider and are therefore considered Level 2 valuations. · Annually every security holding is priced by a pricing service independent of the regular and recurring pricing services used. The independent service provides a measurement to indicate if the price assigned by the regular service is within or outside of a reasonable range. Management reviews this report and applies judgment in adjusting calculations at year end related to securities pricing. · Residential mortgage loans available for sale in the secondary market are carried at fair market value. The fair value of loans held-for-sale is determined using quoted secondary market prices. · Lending related commitments to fund certain residential mortgage loans, e.g., residential mortgage loans with locked interest rates to be sold in the secondary market and forward commitments for the future delivery of mortgage loans to third party investors, as well as forward commitments for future delivery of MBS are considered derivatives. Fair values are estimated based on observable changes in mortgage interest rates including prices for MBS from the date of the commitment and do not typically involve significant judgments by management. · The fair value of mortgage servicing rights is based on a valuation model that calculates the present value of estimated net servicing income. The valuation model incorporates assumptions that market participants would use in estimating future net servicing income to derive the resultant value. The Company is able to compare the valuation model inputs, such as the discount rate, prepayment speeds, weighted average delinquency and foreclosure/bankruptcy rates to widely available published industry data for reasonableness. · Interest rate swap positions, both assets and liabilities, are based on valuation pricing models using an income approach reflecting readily observable market parameters such as interest rate yield curves. · The fair value of impaired loans with specific allocations of the allowance for loan and lease losses is essentially based on recent real estate appraisals or the fair value of the collateralized asset. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are made in the appraisal process by the appraisers to reflect differences between the available comparable sales and income data. Such adjustments are usually significant and typically result in a Level 3 classification of the inputs for determining fair value. · Nonrecurring adjustments to certain commercial and residential real estate properties classified as OREO are measured at the lower of carrying amount or fair value, less costs to sell. Fair values are based on third party appraisals of the property, resulting in a Level 3 classification. In cases where the carrying amount exceeds the fair value, less costs to sell, an impairment loss is recognized. Assets and Liabilities Measured at Fair Value on a Recurring Basis : The tables below present the balance of assets and liabilities at September 30, 2018, and December 31, 2017, respectively, measured by the Company at fair value on a recurring basis: September 30, 2018 Level 1 Level 2 Level 3 Total Assets: Securities available-for-sale U.S. Treasury $ 3,854 $ - $ - $ 3,854 U.S. government agencies - 11,703 - 11,703 U.S. government agencies mortgage-backed - 14,766 - 14,766 States and political subdivisions - 262,753 9,511 272,264 Collateralized mortgage obligations - 63,396 1,564 64,960 Asset-backed securities - 109,173 - 109,173 Collateralized loan obligations - 65,618 - 65,618 Loans held-for-sale - 2,911 - 2,911 Mortgage servicing rights - - 8,131 8,131 Interest rate swap agreements - 2,803 - 2,803 Mortgage banking derivatives - 151 - 151 Total $ 3,854 $ 533,274 $ 19,206 $ 556,334 Liabilities: Interest rate swap agreements $ - $ 2,803 $ - $ 2,803 Total $ - $ 2,803 $ - $ 2,803 December 31, 2017 Level 1 Level 2 Level 3 Total Assets: Securities available-for-sale U.S. Treasury $ 3,947 $ - $ - $ 3,947 U.S. government agencies - 13,061 - 13,061 U.S. government agencies mortgage-backed - 12,214 - 12,214 States and political subdivisions - 263,831 14,261 278,092 Corporate bonds - 833 - 833 Collateralized mortgage obligations - 63,671 2,268 65,939 Asset-backed securities - 112,932 - 112,932 Collateralized loan obligations - 54,421 - 54,421 Loans held-for-sale - 4,067 - 4,067 Mortgage servicing rights - - 6,944 6,944 Interest rate swap agreements - 727 - 727 Mortgage banking derivatives - 238 - 238 Total $ 3,947 $ 525,995 $ 23,473 $ 553,415 Liabilities: Interest rate swap agreements $ - $ 2,014 $ - $ 2,014 Total $ - $ 2,014 $ - $ 2,014 The changes in Level 3 assets and liabilities measured at fair value on a recurring basis are as follows: Nine Months Ended September 30, 2018 Securities available-for-sale Collateralized States and Mortgage Mortgage Political Servicing Obligation Subdivisions Rights Beginning balance January 1, 2018 $ 2,268 $ 14,261 $ 6,944 Transfers into Level 3 - - - Transfers out of Level 3 - - - Total gains or losses Included in earnings (or changes in net assets) 32 - 636 Included in other comprehensive income 34 (805) - Purchases, issuances, sales, and settlements Purchases - 20,421 - Issuances - - 997 Settlements (770) (24,366) (446) Ending balance September 30, 2018 $ 1,564 $ 9,511 $ 8,131 Nine Months Ended September 30, 2017 Securities available-for-sale Collateralized States and Mortgage Mortgage Political Servicing Obligation Subdivisions Rights Beginning balance January 1, 2017 $ 3,119 $ 22,226 $ 6,489 Transfers into Level 3 - - - Transfers out of Level 3 - - - Total gains or losses Included in earnings (or changes in net assets) 32 - (354) Included in other comprehensive income 7 (501) - Purchases, issuances, sales, and settlements Purchases - 10,994 - Issuances - - 951 Settlements (666) (20,359) (402) Ending balance September 30, 2017 $ 2,492 $ 12,360 $ 6,684 The following table and commentary presents quantitative and qualitative information about Level 3 fair value measurements as of September 30, 2018: Weighted Measured at fair value Unobservable Average on a recurring basis: Fair Value Valuation Methodology Inputs Range of Input of Inputs Mortgage servicing rights $ 8,131 Discounted Cash Flow Discount Rate 7.0 - 302.1% 10.2 % Prepayment Speed 7.0 - 68.9% 8.1 % The following table and commentary presents quantitative and qualitative information about Level 3 fair value measurements as of December 31, 2017: Weighted Measured at fair value Unobservable Average on a recurring basis: Fair Value Valuation Methodology Inputs Range of Input of Inputs Mortgage servicing rights $ 6,944 Discounted Cash Flow Discount Rate 10.0 - 34.3% 10.2 % Prepayment Speed 7.0 - 68.4% 9.6 % In addition to the above, Level 3 fair value measurement included $9.5 million for state and political subdivisions representing various local municipality securities and $1.6 million of collateralized mortgage obligations at September 30, 2018. Both of these were classified as securities available-for-sale, and were valued using a discount based on market spreads of similar assets, but the liquidity premium was an unobservable input. The state and political subdivisions securities balance in Level 3 fair value at September 30, 2017, was $12.4 million and collateralized mortgage obligation balance in Level 3 was $2.5 million. Both of these were classified as securities available-for-sale, and were valued using a discount based on market spreads of similar assets, but the liquidity premium was an unobservable input. Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis: The Company may be required, from time to time, to measure certain other assets at fair value on a nonrecurring basis in accordance with GAAP. These assets consist of impaired loans and OREO. For assets measured at fair value on a nonrecurring basis at September 30, 2018, and December 31, 2017, respectively, the following tables provide the level of valuation assumptions used to determine each valuation and the carrying value of the related assets: September 30, 2018 Level 1 Level 2 Level 3 Total Impaired loans 1 $ - $ - $ 9,269 $ 9,269 Other real estate owned, net 2 - - 6,964 6,964 Total $ - $ - $ 16,233 $ 16,233 1 Represents carrying value and related write-downs of loans for which adjustments are substantially based on the appraised value of collateral for collateral-dependent loans; had a carrying amount of $9.6 million and a valuation allowance of $373,000 resulting in an increase of specific allocations within the allowance for loan and lease losses of $229,000 for the nine months ended September 30, 2018. 2 OREO is measured at the lower of carrying or fair value less costs to sell, and had a net carrying amount of $7.0 million, which is made up of the outstanding balance of $15.9 million, net of a valuation allowance of $8.0 million and participations of $937,000 at September 30, 2018. December 31, 2017 Level 1 Level 2 Level 3 Total Impaired loans 1 $ - $ - $ 5,113 $ 5,113 Other real estate owned, net 2 - - 8,371 8,371 Total $ - $ - $ 13,484 $ 13,484 1 Represents carrying value and related write-downs of loans for which adjustments are substantially based on the appraised value of collateral for collateral-dependent loans; had a carrying amount of $5.3 million and a valuation allowance of $144,000, resulting in an increase of specific allocations within the allowance for loan and lease losses of $856,000 for the year December 31, 2017. 2 OREO is measured at the lower of carrying or fair value less costs to sell, and had a net carrying amount of $8.4 million, which is made up of the outstanding balance of $17.5 million, net of a valuation allowance of $8.2 million and participations of $937,000, at December 31, 2017. The Company has estimated the fair values of these assets based primarily on Level 3 inputs. OREO and impaired loans are generally valued using the fair value of collateral provided by third party appraisals. These valuations include assumptions related to cash flow projections, discount rates, and recent comparable sales. The numerical ranges of unobservable inputs for these valuation assumptions are not meaningful.

Fair Values of Financial Instru

Fair Values of Financial Instruments	9 Months Ended
	Sep. 30, 2018
Fair Values of Financial Instruments
Fair Values of Financial Instruments	Note 14 – Fair Values of Financial Instruments The estimated fair values approximate carrying amount for all items except those described in the following table. Securities available-for-sale fair values are based upon market prices or dealer quotes, and if no such information is available, on the rate and term of the security. The carrying value of FHLBC stock approximates fair value as the stock is nonmarketable and can only be sold to the FHLBC or another member institution at par. FHLBC stock is carried at cost and considered a Level 2 fair value. For September 30, 2018, the fair values of loans and leases are estimated on an exit price basis incorporating discounts for credit, liquidity and marketability factors. This is not comparable with the fair value disclosures for December 31, 2017, which were estimated using an entrance price basis. For December 31, 2017, fair values of variable rate loans and leases with no significant change in credit risk were based on carrying values. The fair values of other loans and leases were estimated using discounted cash flow analyses which used interest rates being offered for loans and leases with similar terms to borrowers of similar credit quality. The fair value of time deposits is estimated using discounted future cash flows at current rates offered for deposits of similar remaining maturities. The fair values of borrowings were estimated based on interest rates available to the Company for debt with similar terms and remaining maturities. The fair value of off balance sheet volume is not considered material. The carrying amount and estimated fair values of financial instruments were as follows: September 30, 2018 Carrying Fair Amount Value Level 1 Level 2 Level 3 Financial assets: Cash and due from banks $ 34,366 $ 34,366 $ 34,366 $ - $ - Interest bearing deposits with financial institutions 15,956 15,956 15,956 - - Securities available-for-sale 542,338 542,338 3,854 527,409 11,075 FHLBC and FRBC Stock 10,511 10,511 - 10,511 - Loans held-for-sale 2,911 2,911 - 2,911 - Net loans 1,815,621 1,801,489 - - 1,801,489 Interest rate swap agreements 1,135 1,135 - 1,135 Accrued interest receivable 10,460 10,460 - 10,460 - Financial liabilities: Noninterest bearing deposits $ 621,580 $ 621,580 $ 621,580 $ - $ - Interest bearing deposits 1,510,790 1,583,984 - 1,583,984 - Securities sold under repurchase agreements 44,333 44,333 - 44,333 - Other short-term borrowings 81,875 81,875 - 81,875 - Junior subordinated debentures 57,674 59,104 33,336 25,769 - Senior notes 44,133 45,693 - 45,693 - Note payable and other borrowings 18,050 18,050 - 18,050 - Borrowing interest payable 801 801 - 801 - Deposit interest payable 924 924 - 924 - December 31, 2017 Carrying Fair Amount Value Level 1 Level 2 Level 3 Financial assets: Cash and due from banks $ 37,444 $ 37,444 $ 37,444 $ - $ - Interest bearing deposits with financial institutions 18,389 18,389 18,389 - - Securities available-for-sale 541,439 541,439 3,947 520,963 16,529 FHLBC and FRBC Stock 10,168 10,168 - 10,168 - Loans held-for-sale 4,067 4,067 - 4,067 - Net loans 1,600,161 1,586,722 - - 1,586,722 Accrued interest receivable 8,595 8,595 - 8,595 - Financial liabilities: Noninterest bearing deposits $ 572,404 $ 572,404 $ 572,404 $ - $ - Interest bearing deposits 1,350,521 1,346,339 - 1,346,339 - Securities sold under repurchase agreements 29,918 29,918 - 29,918 - Other short-term borrowings 115,000 115,000 - 115,000 - Junior subordinated debentures 57,639 59,471 33,267 26,204 - Subordinated debenture 44,058 46,743 - 46,743 - Interest rate swap agreements 1,287 1,287 - 1,287 - Borrowing interest payable 140 140 - 140 - Deposit interest payable 631 631 - 631 -

Financial Instruments with Off-

Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions	9 Months Ended
	Sep. 30, 2018
Derivatives, Hedging Activities and Financial Instruments with Off-Balance Sheet Risk
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions	Note 15 – Derivatives, Hedging Activities and Financial Instruments with Off-Balance Sheet Risk Risk Management Objective of Using Derivatives The Company is exposed to certain risk arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its assets and liabilities and the use of derivative financial instruments. Specifically, the Company enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates. The Company’s derivative financial instruments are used to manage differences in the amount, timing, and duration of the Company’s known or expected cash receipts and its known or expected cash payments principally related to the Company’s loan portfolio. Cash Flow Hedges of Interest Rate Risk The Company’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Company primarily uses interest rate swaps as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. During 2018, such derivatives were used to hedge the variable cash flows associated with existing variable-rate borrowings. For derivatives designated and that qualify as cash flow hedges of interest rate risk, the gain or loss on the derivative is recorded in Accumulated Other Comprehensive Income and subsequently reclassified into interest expense in the same period(s) during which the hedged transaction affects earnings. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are received on the Company’s variable-rate borrowings. During the next twelve months, the Company estimates that an additional $18,000 will be reclassified as a reduction to interest expense. Non-designated Hedges Derivatives not designated as hedges are not speculative and result from a service the Company provides to certain customers. The Company executes interest rate swaps with commercial banking customers to facilitate their respective risk management strategies. Those interest rate swaps are simultaneously hedged by offsetting derivatives that the Company executes with a third party, such that the Company minimizes its net risk exposure resulting from such transactions. As the interest rate derivatives associated with this program do not meet the strict hedge accounting requirements, changes in the fair value of both the customer derivatives and the offsetting derivatives are recognized directly in earnings. The Company also grants mortgage loan interest rate lock commitments to borrowers, subject to normal loan underwriting standards. The interest rate risk associated with these loan interest rate lock commitments is managed with contracts for future deliveries of loans as well as selling forward mortgage-backed securities contracts. Loan interest rate lock commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. Commitments to originate residential mortgage loans held-for-sale and forward commitments to sell residential mortgage loans or forward MBS contracts are considered derivative instruments and changes in the fair value are recorded to mortgage banking revenue. Fair values are estimated based on observable changes in mortgage interest rates including mortgage-backed securities prices from the date of the commitment. Disclosure of Fair Values of Derivative Instruments on the Balance Sheet The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the Balance Sheet as of September 30, 2018 and December 31, 2017. Fair Value of Derivative Instruments Asset Derivatives Liability Derivatives September 30, 2018 December 31, 2017 September 30, 2018 December 31, 2017 No. of Trans. Notional Amount $ Balance Sheet Location Fair Value $ Balance Sheet Location Fair Value $ Balance Sheet Location Fair Value $ Balance Sheet Location Fair Value $ Derivatives designated as hedging instruments Interest rate swaps 25,774 Other Assets 1,135 Other Assets - Other Liabilities - Other Liabilities Total derivatives designated as hedging instruments 1,135 - - Derivatives not designated as hedging instruments Interest rate swaps with commercial loan customers Other Assets 2,803 Other Assets 727 Other Liabilities Other Liabilities 727 Interest rate lock commitments and forward contracts 25,250 Other Assets 151 Other Assets 238 Other Liabilities - Other Liabilities - Other contracts 15,806 Other Assets - Other Assets - Other Liabilities 3 Other Liabilities 13 Total derivatives not designated as hedging instruments 2,954 965 740 Disclosure of the Effect of Fair Value and Cash Flow Hedge Accounting The fair value and cash flow hedge accounting related to derivatives covered under ASC Subtopic 815-20 impacted Accumulated Other Comprehensive Income (“AOCI”) and the Income Statement. The gain recognized in AOCI on derivatives totaled $599,000 as of September 30, 2018, and a loss in AOCI of $80,000 as of September 30, 2017. The amount of the gain (loss) reclassified from AOCI to interest income on the income statement totaled ($29,000) and ($101,000) for the three months ended September 30, 2018, and September 30, 2017, respectively. The amount of the gain (loss) reclassified from AOCI to interest income or interest expense on the income statement totaled ($145,000) and ($119,000) for the nine months ended September 30, 2018, and September 30, 2017, respectively. Credit-risk-related Contingent Features For derivative transactions involving counterparties who are lending customers of the Company, the derivative credit exposure is managed through the normal credit review and monitoring process, which may include collateralization, financial covenants and/or financial guarantees of affiliated parties. Agreements with such customers require that losses associated with derivative transactions receive payment priority from any funds recovered should a customer default and ultimate disposition of collateral or guarantees occur. Credit exposure to broker/dealer counterparties is managed through agreements with each derivative counterparty that require collateralization of fair value gains owed by such counterparties. Some small degree of credit exposure exists due to timing differences between when a gain may occur and the subsequent point in time that collateral is delivered to secure that gain. This is monitored by the Company and procedures are in place to minimize this exposure. Such agreements also require the Company to collateralize counterparties in circumstances wherein the fair value of the derivatives result in loss to the Company. Other provisions of such agreements include the definition of certain events that may lead to the declaration of default and/or the early termination of the derivative transaction(s): · if the Company either defaults or is capable of being declared in default on any of its indebtedness (exclusive of deposit obligations), then the Company could also be declared in default on its derivative obligations. · if a merger occurs that materially changes the Company's creditworthiness in an adverse manner. · If certain specified adverse regulatory actions occur, such as the issuance of a Cease and Desist Order, or citations for actions considered Unsafe and Unsound or that may lead to the termination of deposit insurance coverage by the Federal Deposit Insurance Corporation. As of September 30, 2018, there were no derivatives in a net liability position. As of September 30, 2018, the Company has not posted any collateral related to derivatives agreements. The Bank also issues letters of credit, which are conditional commitments that guarantee the performance of a customer to a third party. The credit risk involved and collateral obtained in issuing letters of credit are essentially the same as that involved in extending loan commitments to our customers. In addition to customer related commitments, the Company is responsible for letters of credit commitments that relate to properties held in OREO. The following table represents the Company’s contractual commitments due to letters of credit as of September 30, 2018, and December 31, 2017. The following table is a summary of letter of credit commitments (in thousands): September 30, 2018 December 31, 2017 Fixed Variable Total Fixed Variable Total Letters of credit: Borrower: Financial standby $ 327 $ 7,165 $ 7,492 $ 177 $ 3,770 $ 3,947 Commercial standby - 388 388 - 354 354 Performance standby 532 7,074 7,606 241 7,594 7,835 859 14,627 15,486 418 11,718 12,136 Non-borrower: Performance standby - 67 67 - 142 142 Total letters of credit $ 859 $ 14,694 $ 15,553 $ 418 $ 11,860 $ 12,278

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2018
Summary of Significant Accounting Policies
Recent Accounting Pronouncements	Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09 “ Revenue from Contracts with Customers (Topic 606).” The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services. In August 2015, the FASB issued ASU 2015-14 “ Revenue from Contracts with Customers (Topic 606) Deferral of the Effective Date, ” which deferred the effective date of ASU 2014-09 for an additional year. ASU 2015-14 was effective for annual reporting periods beginning after December 15, 2017. The amendments could be applied retrospectively to each prior reporting period or retrospectively with the cumulative effect of initially applying this update recognized at the date of initial application. Early application was not permitted. In March 2016, the FASB issued ASU 2016-08 “ Revenue from Contracts with Customers (TOPIC 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) ” and in April 2016, the FASB issued ASU 2016-10 “ Revenue from Contracts with Customers (TOPIC 606): Identifying Performance Obligations and Licensing.” ASU 2016-08 requires the entity to determine if it is acting as a principal with control over the goods or services it is contractually obligated to provide, or an agent with no control over specified goods or services provided by another party to a customer. ASU 2016-10 was issued to further clarify ASU 2014-09 implementation regarding identifying performance obligation materiality, identification of key contract components, and scope. The Company performed an analysis of the impact of adoption of this ASU, reviewing revenue recorded from service charges on deposit accounts, asset management fees, gains (losses) on other real estate owned, and debit card interchange fees. Certain revenue received, such as service charges on deposit accounts and interchange fees, is recorded immediately or as the service is performed. Asset management fees recorded by the Company take the form of wealth management income and brokerage income, and both types of fees are recorded after services are rendered, with no contractual requirement of refund to a customer based on non-achievement of fund performance objectives. Finally, the methodology used to record revenue from gains (losses) due to the sale of other real estate owned is not anticipated to change, as the Company currently records income or expense only upon consummation of the sale, and any revenue recorded stemming from seller financed transactions is reviewed for deferral, as appropriate. The Company adopted ASU 2014-09 and related issuances on January 1, 2018, with no cumulative effect adjustment to opening retained earnings required upon implementation of this standard. In January 2016, the FASB issued ASU No. 2016-01 “ Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities .” The objective of the issuance is to provide users of financial statements with more decision–useful information, by making targeted improvements to GAAP. These targeted improvements included revisions to the methodology of accounting for equity investments, eliminating certain disclosures on fair value assumptions for financial instruments measured at amortized cost, and requiring public business entities to use the exit price notion, as defined in ASC 820, for the measurement of the fair value of financial instruments. This standard was effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company adopted this standard as of January 1, 2018. Adoption of this standard resulted in the Company’s use of an exit price rather than an entrance price to determine the fair value of loans and deposits not already measured at fair value on a non-recurring basis in the consolidated balance sheet disclosures; see Note 14–Fair Value of Financial Instruments for further information regarding the valuation processes. In February 2016, the FASB issued ASU No. 2016-02 “ Leases (Topic 842) .” This ASU was issued to increase transparency and comparability among organizations by recognizing lease assets and liabilities on the balance sheet and disclosing key information about leasing arrangements. One key revision from prior guidance was to include operating leases within assets and liabilities recorded; another revision was to create a new model to follow for sale-leaseback transactions. The impact of this pronouncement will primarily affect lessees, as virtually all of their assets will be recognized on the balance sheet, by recording a right of use asset and lease liability. This pronouncement is effective for fiscal years beginning after December 15, 2018. In July 2018, the FASB issued ASU No. 2018-11, “Leases (Topic 842): Targeted Improvements ” which provided additional guidance on the transition method, including application as a cumulative-effect adjustment to equity and practical expedients to use when accounting for lease components. The Company is in the process of identifying the population of all lease arrangements and an implementation team is currently assessing the impact of the ASU on the Company’s processes, accounting, internal controls over financial reporting, and regulatory capital. In June 2016, the FASB issued ASU No. 2016-13 “ Measurement of Credit Losses on Financial Instruments (Topic 326). ” ASU 2016-13 was issued to provide financial statement users with more useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date to enhance the decision making process. The new methodology to be used should reflect expected credit losses based on relevant vintage historical information, supported by reasonable forecasts of projected loss given defaults, which will affect the collectability of the reported amounts. This new methodology will also require available-for-sale debt securities to have a credit loss recorded through an allowance rather than write-downs. ASU 2016-13 is effective for financial statements issued for fiscal years beginning after December 15, 2019. The Company is assessing the impact of ASU 2016-13 on its accounting and disclosures, and has determined that a loss rate model will be used for calculation of future risk assessments upon the ASU’s adoption in 2020. The Company has accumulated historical data by loan pools and collateral classifications, and anticipates calculation of estimates for at least two quarters in 2019 on a test basis to confirm model processes and to determine financial statement impact prior to adoption in 2020. In March 2017, the FASB issued ASU No. 2017-08 “ Receivables-Nonrefundable Fees and Other Costs – Premium Amortization on Purchased Callable Debt Securities (Subtopic 310-20) .” This ASU was issued to shorten the amortization period for the premium to the earliest call date on debt securities. This premium is required to be recorded as a reduction to net interest margin during the shorter yield to call period, as compared to prior practice of amortizing the premium as a reduction to net interest margin over the contractual life of the instrument. This ASU does not change the current method of amortizing any discount over the contractual life of the debt security, and this pronouncement is effective for fiscal years beginning after December 15, 2018, with earlier adoption permitted. The Company adopted ASU 2017-08 as a change in accounting principle in the third quarter of 2017 on a modified retrospective basis, which required the Company to reflect its adoption effective January 1, 2017. The effect of amortizing the premium over a shorter period will continue to decrease future quarterly net interest income over the call period until the premium is fully amortized. As a result of management’s analysis, the impact of the change in accounting principle as a result of ASU 2017-08 to adjust beginning of year retained earnings was considered insignificant and, accordingly, the impact was adjusted through 2017 earnings. In August 2017, the FASB issued ASU No. 2017-12, “ Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities”. The purpose of this updated guidance is to better align a company’s financial reporting for hedging activities with the economic objectives of those activities. ASU 2017-12 is effective for public business entities for fiscal years beginning after December 15, 2018, with early adoption, including adoption in an interim period, permitted. The Company adopted ASU 2017-12 on January 1, 2018, on a modified retrospective basis. FASB ASC 815, Derivatives and Hedging (“ASC 815”), provides the disclosure requirements for derivatives and hedging activities with the intent to provide users of financial statements with an enhanced understanding of: (a) how and why an entity uses derivative instruments, (b) how the entity accounts for derivative instruments and related hedged items, and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. Further, qualitative disclosures are required that explain the Company’s objectives and strategies for using derivatives, as well as quantitative disclosures about the fair value of and gains and losses on derivative instruments, and disclosures about credit-risk-related contingent features in derivative instruments. As required by ASC 815, the Company records all derivatives on the balance sheet at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether the Company has elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to changes in the fair value of an asset, liability, or firm commitment attributable to a particular risk, such as interest rate risk, are considered fair value hedges. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Derivatives may also be designated as hedges of the foreign currency exposure of a net investment in a foreign operation. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the recognition of the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk in a fair value hedge or the earnings effect of the hedged forecasted transactions in a cash flow hedge. The Company may enter into derivative contracts that are intended to economically hedge certain of its risk, even though hedge accounting does not apply or the Company elects not to apply hedge accounting. In accordance with the FASB’s fair value measurement guidance in ASU 2011-04, the Company made an accounting policy election to measure the credit risk of its derivative financial instruments that are subject to master netting agreements on a net basis by counterparty portfolio. As the Company does not currently have any derivative financial instruments subject to master netting agreements, there was no impact to the balance sheet. In February 2018, the FASB issued ASU No. 2018-02, “ Income Statement-Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income .” This ASU was issued in response to the enactment of tax bill H.R.1 “Tax Cuts and Jobs Act”, which resulted in “stranding” the tax effects of items within accumulated other comprehensive income related to the adjustment of deferred taxes due to the reduction of the federal corporate income tax rate. The amendments proposed allow the reclassification of these stranded tax effects to retained earnings, and were effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted, and should be applied either in the period of adoption or retrospectively to each period in which the effect of the change in the U.S. federal corporate tax rate is recognized. The Company adopted ASU 2018-02 as of January 1, 2018, and a reclassification of $319,000, net, was recorded, which increased accumulated other comprehensive income and reduced retained earnings with the adoption of the accounting standard.
Subsequent Events	Subsequent Events On October 16, 2018, the Company’s Board of Directors declared a cash dividend of $0.01 per share payable on November 5, 2018, to stockholders of record as of October 26, 2018; dividends of $298,000 were paid to stockholders on November 5, 2018.

Acquisitions (Tables)

Acquisitions (Tables)	9 Months Ended
	Sep. 30, 2018
Acquisitions
Summary of acquisition	GCFC/ABC Bank Acquisition Summary As of Date of Acquisition April 20, 2018 Assets Cash and due from banks $ 6,669 Interest bearing deposits with financial institutions 500 Securities available-for-sale, at fair value 72,091 Federal funds sold 4,300 FHLBC stock 1,549 Loans 227,594 Premises and equipment 5,339 Other real estate owned 401 Goodwill and core deposit intangible 12,966 Deferred tax assets, net 3,459 Other assets 1,925 Total assets $ 336,793 Liabilities Noninterest bearing demand $ 58,005 Savings, NOW and money market 91,494 Time 98,999 Total deposits 248,498 Securities sold under repurchase agreements 5,624 Other short-term borrowings 10,875 Notes payable and other borrowings 23,367 Other liabilities 1,249 Total liabilities 289,613 Cash consideration paid 47,180 Total Liabilities Assumed and Cash Consideration Paid for Acquisition $ 336,793
Schedule of Acquired Loans as of Acquisition Date	April 20, 2018 September 30, 2018 ABC Bank Acquired Loans PCI Non-PCI PCI Non-PCI Fair Value $ 11,360 $ 216,306 $ 10,887 $ 201,289 Contractually required principal and interest payment 19,447 219,488 18,174 203,156 Best estimate of contractual cash flows not expected to be collected 6,537 2,511 6,069 1,457 Best estimate of contractual cash flows expected to be collected 12,910 216,977 12,105 201,699

Securities (Tables)

Securities (Tables)	9 Months Ended
	Sep. 30, 2018
Securities
Schedule of amortized cost and fair value of the securities portfolio and corresponding amounts of gross unrealized gains and losses recognized in accumulated other comprehensive loss	Gross Gross Amortized Unrealized Unrealized Fair September 30, 2018 Cost Gains Losses Value Securities available-for-sale U.S. Treasuries $ 4,005 $ - $ (151) $ 3,854 U.S. government agencies 11,881 - (178) 11,703 U.S. government agencies mortgage-backed 15,474 - (708) 14,766 States and political subdivisions 278,604 398 (6,738) 272,264 Collateralized mortgage obligations 67,762 118 (2,920) 64,960 Asset-backed securities 108,622 991 (440) 109,173 Collateralized loan obligations 65,555 162 (99) 65,618 Total securities available-for-sale $ 551,903 $ 1,669 $ (11,234) $ 542,338 Gross Gross Amortized Unrealized Unrealized Fair December 31, 2017 Cost Gains Losses Value Securities available-for-sale U.S. Treasury $ 4,002 $ - $ (55) $ 3,947 U.S. government agencies 13,062 8 (9) 13,061 U.S. government agencies mortgage-backed 12,372 7 (165) 12,214 States and political subdivisions 272,240 7,116 (1,264) 278,092 Corporate bonds 823 21 (11) 833 Collateralized mortgage obligations 66,892 202 (1,155) 65,939 Asset-backed securities 113,983 862 (1,913) 112,932 Collateralized loan obligations 54,271 251 (101) 54,421 Total securities available-for-sale $ 537,645 $ 8,467 $ (4,673) $ 541,439
Schedule of fair value, amortized cost and weighted average yield of debt securities by contractual maturity along with securities not due at a single maturity date, primarily mortgage-backed securities (MBS), asset-backed securities, and collateralized loan obligations	Weighted Amortized Average Fair Securities available-for-sale Cost Yield Value Due in one year or less $ 1,500 4.78 % $ 1,502 Due after one year through five years 4,005 1.85 3,854 Due after five years through ten years 6,688 3.03 6,626 Due after ten years 282,297 3.00 275,839 294,490 3.00 287,821 Mortgage-backed and collateralized mortgage obligations 83,236 3.21 79,726 Asset-backed securities 108,622 3.22 109,173 Collateralized loan obligations 65,555 4.71 65,618 Total securities available-for-sale $ 551,903 3.28 % $ 542,338
Schedule of amortized cost and fair value of securities that exceed 10% of stockholders equity	The Company has invested in securities issued from three originators that individually amount to over 10% of the Company’s stockholders equity. Information regarding these three issuers and the value of the securities issued follows: September 30, 2018 Amortized Fair Issuer Cost Value GCO Education Loan Funding Corp $ 27,711 $ 27,788 Towd Point Mortgage Trust 34,390 33,181 Student Loan Marketing Association 25,798 26,134
Schedule of securities with unrealized losses aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position	Less than 12 months 12 months or more September 30, 2018 in an unrealized loss position in an unrealized loss position Total Number of Unrealized Fair Number of Unrealized Fair Number of Unrealized Fair Securities available-for-sale Securities Losses Value Securities Losses Value Securities Losses Value U.S. Treasuries - $ - $ - 1 $ 151 $ 3,854 1 $ 151 $ 3,854 U.S. government agencies 3 109 7,829 1 69 3,874 4 178 11,703 U.S. government agencies mortgage-backed 6 287 7,357 7 421 7,409 13 708 14,766 States and political subdivisions 55 3,843 174,924 9 2,895 28,218 64 6,738 203,142 Collateralized mortgage obligations 4 714 25,620 8 2,206 33,342 12 2,920 58,962 Asset-backed securities 3 79 7,526 5 361 30,240 8 440 37,766 Collateralized loan obligations 4 85 24,502 1 14 7,986 5 99 32,488 Total securities available-for-sale 75 $ 5,117 $ 247,758 32 $ 6,117 $ 114,923 107 $ 11,234 $ 362,681 Less than 12 months 12 months or more December 31, 2017 in an unrealized loss position in an unrealized loss position Total Number of Unrealized Fair Number of Unrealized Fair Number of Unrealized Fair Securities available-for-sale Securities Losses Value Securities Losses Value Securities Losses Value U.S. Treasuries 1 $ 55 $ 3,947 - $ - $ - 1 $ 55 $ 3,947 U.S. government agencies 2 9 6,550 - - - 2 9 6,550 U.S. government agencies mortgage-backed 4 24 5,501 5 141 4,843 9 165 10,344 States and political subdivisions 13 1,237 45,985 1 27 1,512 14 1,264 47,497 Corporate bonds - - - 1 11 332 1 11 332 Collateralized mortgage obligations 3 31 11,534 8 1,124 40,219 11 1,155 51,753 Asset-backed securities - - - 7 1,913 61,745 7 1,913 61,745 Collateralized loan obligations 3 101 29,313 - - - 3 101 29,313 Total securities available-for-sale 26 $ 1,457 $ 102,830 22 $ 3,216 $ 108,651 48 $ 4,673 $ 211,481
Schedule of proceeds from sale and gross realized gains and losses on sale of securities	Three Months Ended Nine Months Ended September 30, September 30, Securities available-for-sale 2018 2017 2018 2017 Proceeds from sales of securities $ 1,917 $ 51,620 $ 94,663 $ 152,476 Gross realized gains on securities 23 474 370 911 Gross realized losses on securities (10) (371) (10) (1,076) Securities realized gains (losses), net $ 13 $ 103 $ 360 $ (165) Income tax (expense) benefit on net realized gains (losses) (2) (42) (100) 24

Loans (Tables)

Loans (Tables)	9 Months Ended
	Sep. 30, 2018
Loans
Schedule of major classifications of loans	September 30, 2018 December 31, 2017 Commercial $ 306,407 $ 272,851 Leases 70,661 68,325 Real estate - commercial 804,184 750,991 Real estate - construction 112,873 85,162 Real estate - residential 393,598 313,397 Home equity lines of credit "HELOC" 122,022 112,833 Other 1 12,969 13,383 Total loans, excluding deferred loan costs and PCI loans 1,822,714 1,616,942 Net deferred loan costs 1,348 680 Total loans, excluding PCI loans 1,824,062 1,617,622 PCI loans, net of purchase accounting adjustments 10,887 - Total loans $ 1,834,949 $ 1,617,622
Schedule of aged analysis of past due loans by class of loans	Recorded Investment 90 days or 90 Days or Greater Past 30-59 Days 60-89 Days Greater Past Total Past Due and September 30, 2018 Past Due Past Due Due Due Current Nonaccrual Total Loans Accruing Commercial $ 1,074 $ - $ 6 $ 1,080 $ 305,327 $ - $ 306,407 $ 6 Leases - - - - 70,661 - 70,661 - Real estate - commercial Owner occupied general purpose 1,022 - - 1,022 164,304 1,625 166,951 - Owner occupied special purpose 891 - - 891 188,984 410 190,285 - Non-owner occupied general purpose 346 3,422 - 3,768 293,979 142 297,889 - Non-owner occupied special purpose - - - - 85,171 3,099 88,270 - Retail properties 624 - - 624 46,252 - 46,876 - Farm 1,241 - - 1,241 12,672 - 13,913 - Real estate - construction Homebuilder - - - - 4,556 - 4,556 - Land - - - - 3,841 - 3,841 - Commercial speculative - - - - 56,052 - 56,052 - All other 38 - - 38 48,277 109 48,424 - Real estate - residential Investor 952 - - 952 70,102 364 71,418 - Multifamily 1,304 - 73 1,377 179,645 - 181,022 76 Owner occupied 780 136 - 916 136,678 3,564 141,158 - HELOC 1,422 92 - 1,514 119,880 628 122,022 - Other 1 42 1 - 43 14,234 40 14,317 - Total, excluding PCI loans $ 9,736 $ 3,651 $ 79 $ 13,466 $ 1,800,615 $ 9,981 $ 1,824,062 $ 82 PCI loans, net of purchase accounting adjustments 3,415 - - 3,415 5,174 2,298 10,887 - Total $ 13,151 $ 3,651 $ 79 $ 16,881 $ 1,805,789 $ 12,279 $ 1,834,949 $ 82 Recorded Investment 90 days or 90 Days or Greater Past 30-59 Days 60-89 Days Greater Past Total Past Due and December 31, 2017 Past Due Past Due Due Due Current Nonaccrual Total Loans Accruing Commercial $ 995 $ 275 $ - $ 1,270 $ 271,581 $ - $ 272,851 $ - Leases - - - - 68,147 178 68,325 - Real estate - commercial Owner occupied general purpose 1,136 - - 1,136 144,267 455 145,858 - Owner occupied special purpose 226 - - 226 170,546 342 171,114 - Non-owner occupied general purpose - 593 - 593 273,203 1,163 274,959 - Non-owner occupied special purpose - - 248 248 92,923 - 93,171 254 Retail properties - - - - 49,538 1,081 50,619 - Farm - - - - 15,270 - 15,270 - Real estate - construction Homebuilder 129 - - 129 2,221 - 2,350 - Land 1,124 - - 1,124 1,319 - 2,443 - Commercial speculative - - - - 32,028 - 32,028 - All other - - - - 48,140 201 48,341 - Real estate - residential Investor - - - - 55,248 372 55,620 - Multifamily - - - - 125,049 4,723 129,772 - Owner occupied 74 - - 74 123,257 4,674 128,005 - HELOC 491 278 - 769 110,872 1,192 112,833 - Other 1 37 - - 37 14,019 7 14,063 - Total $ 4,212 $ 1,146 $ 248 $ 5,606 $ 1,597,628 $ 14,388 $ 1,617,622 $ 254 1 The “Other” class includes consumer, overdrafts and net deferred costs.
Schedule of credit quality indicators by class of loans	September 30, 2018 Special Pass Mention Substandard 2 Doubtful Total Commercial $ 303,176 $ 2,878 $ 353 $ - $ 306,407 Leases 70,661 - - - 70,661 Real estate - commercial Owner occupied general purpose 160,999 1,489 4,463 - 166,951 Owner occupied special purpose 183,375 2,883 4,027 - 190,285 Non-owner occupied general purpose 289,438 834 7,617 - 297,889 Non-owner occupied special purpose 83,648 1,523 3,099 - 88,270 Retail Properties 45,074 - 1,802 - 46,876 Farm 11,423 1,249 1,241 - 13,913 Real estate - construction Homebuilder 4,556 - - - 4,556 Land 3,841 - - - 3,841 Commercial speculative 56,052 - - - 56,052 All other 46,152 1,990 282 - 48,424 Real estate - residential Investor 70,315 - 1,103 - 71,418 Multifamily 177,845 - 3,177 - 181,022 Owner occupied 135,625 511 5,022 - 141,158 HELOC 120,193 - 1,829 - 122,022 Other 1 14,262 - 55 - 14,317 Total, excluding PCI loans $ 1,776,635 $ 13,357 $ 34,070 $ - $ 1,824,062 PCI loans, net of purchase accounting adjustments - - 10,887 - 10,887 Total $ 1,776,635 $ 13,357 $ 44,957 $ - $ 1,834,949 December 31, 2017 Special Pass Mention Substandard 2 Doubtful Total Commercial $ 270,889 $ 1,962 $ - $ - $ 272,851 Leases 67,500 - 825 - 68,325 Real estate - commercial Owner occupied general purpose 142,843 1,927 1,088 - 145,858 Owner occupied special purpose 169,621 1,152 341 - 171,114 Non-owner occupied general purpose 271,731 2,065 1,163 - 274,959 Non-owner occupied special purpose 89,582 - 3,589 - 93,171 Retail Properties 48,321 1,217 1,081 - 50,619 Farm 11,755 1,029 2,486 - 15,270 Real estate - construction Homebuilder 2,350 - - - 2,350 Land 2,443 - - - 2,443 Commercial speculative 32,028 - - - 32,028 All other 46,913 1,052 376 - 48,341 Real estate - residential Investor 55,172 - 448 - 55,620 Multifamily 125,049 - 4,723 - 129,772 Owner occupied 122,178 561 5,266 - 128,005 HELOC 110,934 - 1,899 - 112,833 Other 1 14,043 - 20 - 14,063 Total $ 1,583,352 $ 10,965 $ 23,305 $ - $ 1,617,622 1 The “Other” class includes consumer, overdrafts and net deferred costs. 2 The substandard credit quality indicator includes both potential problem loans that are currently performing and nonperforming loans.
Schedule of impaired loans by class of loan	Three Months Ended Nine Months Ended As of September 30, 2018 September 30, 2018 September 30, 2018 Unpaid Average Interest Average Interest Recorded Principal Related Recorded Income Recorded Income Investment Balance Allowance Investment Recognized Investment Recognized With no related allowance recorded Commercial $ - $ - $ - $ - $ - $ - $ - Leases - - - - - - - Commercial real estate Owner occupied general purpose 1,614 1,699 - 1,263 2 1,035 5 Owner occupied special purpose 409 538 - 417 - 375 - Non-owner occupied general purpose 142 158 - 91 - 653 - Non-owner occupied special purpose - - - - - - - Retail properties - - - - - - - Farm - - - - - - - Construction Homebuilder - - - - - - - Land - - - - - - - Commercial speculative - - - - - - - All other 50 74 - 121 - 125 - Residential Investor 365 466 - 368 - 369 - Multifamily - - - - - 2,361 - Owner occupied 3,855 5,326 - 4,050 11 4,532 29 HELOC 634 739 - 687 - 880 1 Other 1 14 15 - 15 - 10 - Total impaired loans with no recorded allowance 7,083 9,015 - 7,012 13 10,340 35 With an allowance recorded Commercial - - - - - - - Leases - - - - - - - Commercial real estate Owner occupied general purpose 518 518 46 259 22 259 22 Owner occupied special purpose - - - - - - - Non-owner occupied general purpose - - - - - - - Non-owner occupied special purpose 3,099 3,575 139 3,099 - 1,550 - Retail properties - - - - - - - Farm - - - - - - - Construction Homebuilder - - - - - - - Land - - - - - - - Commercial speculative - - - - - - - All other 59 59 42 30 - 29 - Residential Investor 810 810 10 812 11 820 33 Multifamily - - - - - - - Owner occupied 3,710 3,710 49 3,678 35 3,576 108 HELOC 1,420 1,420 61 1,371 17 1,203 41 Other 1 26 26 26 14 - 13 - Total impaired loans with a recorded allowance 9,642 10,118 373 9,263 85 7,450 204 Total impaired loans $ 16,725 $ 19,133 $ 373 $ 16,275 $ 98 $ 17,790 $ 239 1 The “Other” class includes consumer, overdrafts and net deferred costs. Impaired loans by class of loans as of December 31, 2017, and for the three and nine months ended September 30, 2017, were as follows: Three Months Ended Nine Months Ended As of December 31, 2017 September 30, 2017 September 30, 2017 Unpaid Average Interest Average Interest Recorded Principal Related Recorded Income Recorded Income Investment Balance Allowance Investment Recognized Investment Recognized With no related allowance recorded Commercial $ - $ - $ - $ 212 $ - $ 123 $ - Leases 178 213 - 208 - 281 - Commercial real estate Owner occupied general purpose 455 495 - 458 - 1,169 - Owner occupied special purpose 342 498 - 363 - 372 - Non-owner occupied general purpose 1,163 1,538 - 1,180 1 1,481 2 Non-owner occupied special purpose - - - - - 507 - Retail properties 1,081 1,177 - 1,129 - 1,146 - Farm - - - - - - - Construction Homebuilder - - - - - - - Land - - - - - - - Commercial speculative - - - 34 - 37 - All other 201 229 - 178 - 206 - Residential Investor 372 676 - 1,475 16 1,607 36 Multifamily 4,723 4,965 - 4,791 - 2,379 - Owner occupied 5,208 6,680 - 8,179 54 8,987 119 HELOC 1,125 1,313 - 1,981 12 2,237 27 Other 1 7 8 - 9 - 104 - Total impaired loans with no recorded allowance 14,855 17,792 - 20,197 83 20,636 184 With an allowance recorded Commercial - - - - - - - Leases - - - 120 - - - Commercial real estate Owner occupied general purpose - - - - - - - Owner occupied special purpose - - - - - - - Non-owner occupied general purpose - - - - - 123 - Non-owner occupied special purpose - - - - - - - Retail properties - - - - - - - Farm - - - - - - - Construction Homebuilder - - - - - - - Land - - - - - - - Commercial speculative - - - - - - - All other - - - - - - - Residential Investor 829 829 10 - - - - Multifamily - - - - - - - Owner occupied 3,443 3,443 43 - - 402 - HELOC 985 985 91 25 2 26 2 Other 1 - - - - - - - Total impaired loans with a recorded allowance 5,257 5,257 144 145 2 551 2 Total impaired loans $ 20,112 $ 23,049 $ 144 $ 20,342 $ 85 $ 21,187 $ 186
Schedule of TDRs modified during the period by type of modification	TDRs that were modified during the period are as follows: TDR Modifications TDR Modifications Three Months Ended September 30, 2018 Nine Months Ended September 30, 2018 # of Pre-modification Post-modification # of Pre-modification Post-modification contracts recorded investment recorded investment contracts recorded investment recorded investment Troubled debt restructurings Real estate - commercial Owner occupied general purpose Other 1 1 $ 427 $ 424 1 $ 427 $ 424 Owner occupied special purpose Other 1 - - - 1 110 52 Real estate - residential Owner occupied HAMP 2 1 211 211 3 383 331 Other 1 1 34 29 1 34 29 HELOC HAMP 2 1 26 26 1 26 26 Rate 3 1 24 24 Other 1 2 93 92 9 596 587 Total 6 $ 791 $ 782 17 $ 1,600 $ 1,473 TDR Modifications TDR Modifications Three Months Ended September 30, 2017 Nine Months Ended September 30, 2017 # of Pre-modification Post-modification # of Pre-modification Post-modification contracts recorded investment recorded investment contracts recorded investment recorded investment Troubled debt restructurings HELOC Other 1 2 $ 155 $ 147 6 $ 399 $ 388 Total 2 $ 155 $ 147 6 $ 399 $ 388 1 Other: Change of terms from bankruptcy court. 2 HAMP: Home Affordable Modification Program. 3 Rate: Refers to interest rate reduction
Schedule of accretable discount on purchased loans	The following table details the accretable discount on all of the Company’s purchased loans, both non-PCI loans and PCI loans as of September 30, 2018. Accretable Discount - Non-PCI Loans Accretable Discount - PCI Loans Non-Accretable Discount - PCI Loans Total Beginning balance, July 1, 2018 $ 2,995 $ 1,373 $ 6,403 $ 10,771 Purchases - - - - Accretion (312) (129) (334) (775) Transfer 1 (373) (26) - (399) Ending balance, September 30, 2018 $ 2,310 $ 1,218 $ 6,069 $ 9,597 1 Transfer was due to loans moved to OREO.

Allowance for Loan Losses (Tabl

Allowance for Loan Losses (Tables)	9 Months Ended
	Sep. 30, 2018
Allowance for Loan Losses
Schedule of changes in the allowance for loan losses by segment of loans based on method of impairment	Changes in the allowance for loan and lease losses by segment of loans based on method of impairment for the three and nine months ended September 30, 2018, were as follows: Real Estate Real Estate Real Estate Allowance for loan and lease losses: Commercial Leases Commercial Construction Residential HELOC Other 1 Total Three months ended September 30, 2018 Beginning balance $ 2,676 $ 634 $ 10,537 $ 1,398 $ 1,818 $ 1,390 $ 868 $ 19,321 Charge-offs 7 - 201 - - 49 115 372 Recoveries 32 - 37 32 83 139 56 379 Provision (Release) 96 31 (144) (374) 67 (372) 696 - Ending balance $ 2,797 $ 665 $ 10,229 $ 1,056 $ 1,968 $ 1,108 $ 1,505 $ 19,328 Nine months ended September 30, 2018 Beginning balance $ 2,453 $ 692 $ 9,522 $ 923 $ 1,846 $ 1,446 $ 579 $ 17,461 Charge-offs 38 13 609 (16) (55) 141 316 1,046 Recoveries 141 - 425 35 1,099 277 208 2,185 Provision (Release) 241 (14) 891 82 (1,032) (474) 1,034 728 Ending balance $ 2,797 $ 665 $ 10,229 $ 1,056 $ 1,968 $ 1,108 $ 1,505 $ 19,328 Ending balance: Individually evaluated for impairment $ - $ - $ 185 $ 42 $ 59 $ 61 $ 26 $ 373 Ending balance: Collectively evaluated for impairment 2,797 665 10,044 1,014 1,909 1,047 1,479 18,955 Ending balance: Acquired and accounted for ASC 310-30 - - - - - - - - Total ending allowance balance $ 2,797 $ 665 $ 10,229 $ 1,056 $ 1,968 $ 1,108 $ 1,505 $ 19,328 Loans: Ending balance: Individually evaluated for Impairment $ - $ - $ 5,782 $ 109 $ 8,740 $ 2,054 $ 40 $ 16,725 Ending balance: Collectively evaluated for impairment 306,407 70,661 798,402 112,764 384,858 119,968 14,277 1,807,337 Ending balance: Acquired and accounted for ASC 310-30 - - 4,126 778 5,983 - - 10,887 Total ending loans balance $ 306,407 $ 70,661 $ 808,310 $ 113,651 $ 399,581 $ 122,022 $ 14,317 $ 1,834,949 1 The “Other” class includes consumer, overdrafts and net deferred costs. Changes in the allowance for loan and lease losses by segment of loans based on method of impairment for the three and nine months ended September 30, 2017, were as follows: Allowance for loan and lease losses: Commercial Leases Commercial Construction Residential HELOC Other 1 Total Three months ended September 30, 2017 Beginning balance $ 2,150 $ 791 $ 8,107 $ 857 $ 1,872 $ 1,513 $ 546 $ 15,836 Charge-offs 13 98 22 19 5 2 82 241 Recoveries 6 - 43 11 90 369 51 570 (Release) Provision (104) 77 505 165 (187) (455) 299 300 Ending balance $ 2,039 $ 770 $ 8,633 $ 1,014 $ 1,770 $ 1,425 $ 814 $ 16,465 Nine months ended September 30, 2017 Beginning balance $ 1,629 $ 633 $ 9,547 $ 389 $ 2,178 $ 1,331 $ 451 $ 16,158 Charge-offs 20 215 300 23 982 196 262 1,998 Recoveries 13 - 124 89 243 607 179 1,255 Provision (Release) 417 352 (738) 559 331 (317) 446 1,050 Ending balance $ 2,039 $ 770 $ 8,633 $ 1,014 $ 1,770 $ 1,425 $ 814 $ 16,465 Ending balance: Individually evaluated for impairment $ - $ - $ - $ - $ 6 $ - $ - $ 6 Ending balance: Collectively evaluated for impairment 2,039 770 8,633 1,014 1,764 1,425 814 16,459 Total ending allowance balance $ 2,039 $ 770 $ 8,633 $ 1,014 $ 1,770 $ 1,425 $ 814 $ 16,465 Loans: Ending balance: Individually evaluated for impairment $ 207 $ 196 $ 3,147 $ 205 $ 14,281 $ 2,042 $ 8 $ 20,086 Ending balance: Collectively evaluated for impairment 257,149 69,109 735,989 94,663 288,799 114,461 13,935 1,574,105 Total ending loan balance $ 257,356 $ 69,305 $ 739,136 $ 94,868 $ 303,080 $ 116,503 $ 13,943 $ 1,594,191

Other Real Estate Owned (Tables

Other Real Estate Owned (Tables)	9 Months Ended
	Sep. 30, 2018
Other Real Estate Owned
Schedule of activity in the other real estate owned (OREO) portfolio, net of valuation reserve	Three Months Ended Nine Months Ended September 30, September 30, Other real estate owned 2018 2017 2018 2017 Balance at beginning of period $ 8,912 $ 11,724 $ 8,371 $ 11,916 Property additions, net of acquisition adjustments (217) 176 2,595 3,796 Property improvements - - 59 - Less: Proceeds from property disposals, net of participation purchase and of gains/losses 1,612 1,956 3,576 5,058 Period valuation adjustments 119 920 485 1,630 Balance at end of period $ 6,964 $ 9,024 $ 6,964 $ 9,024
Schedule of activity in valuation allowance	Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Balance at beginning of period $ 8,348 $ 8,304 $ 8,208 $ 9,982 Provision for unrealized losses 119 920 485 1,630 Reductions taken on sales (456) (421) (682) (2,809) Other adjustments - - - - Balance at end of period $ 8,011 $ 8,803 $ 8,011 $ 8,803
Schedule of expenses related to foreclosed assets, net of lease revenue	Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Gain on sales, net $ (612) $ (276) $ (716) $ (454) Provision for unrealized losses 119 920 485 1,630 Operating expenses 133 221 502 1,037 Less: Lease revenue 10 185 39 285 Net OREO expense $ (370) $ 680 $ 232 $ 1,928

Deposits (Tables)

Deposits (Tables)	9 Months Ended
	Sep. 30, 2018
Deposits
Schedule of major classifications of deposits	September 30, 2018 December 31, 2017 Noninterest bearing demand $ 621,580 $ 572,404 Savings 298,073 262,220 NOW accounts 437,361 429,448 Money market accounts 310,452 276,082 Certificates of deposit of less than $100,000 235,272 216,493 Certificates of deposit of $100,000 through $250,000 163,716 122,489 Certificates of deposit of more than $250,000 65,916 43,789 Total deposits $ 2,132,370 $ 1,922,925

Borrowings (Tables)

Borrowings (Tables)	9 Months Ended
	Sep. 30, 2018
Borrowings
Summary of borrowings and junior subordinated debentures	September 30, 2018 December 31, 2017 Securities sold under repurchase agreements $ 44,333 $ 29,918 Other short-term borrowings 1 81,875 115,000 Junior subordinated debentures 57,674 57,639 Senior notes 44,133 44,058 Notes payable and other borrowings 18,050 - Total borrowings $ 246,065 $ 246,615

Equity Compensation Plans (Tabl

Equity Compensation Plans (Tables)	9 Months Ended
	Sep. 30, 2018
Equity Compensation Plans
Summary of stock option activity in Incentive Plan	A summary of stock option activity in the Plans for the nine months ended September 30, 2018, is as follows: Weighted- Weighted Average Average Remaining Exercise Contractual Aggregate Shares Price Term (years) Intrinsic Value Beginning outstanding 9,000 $ 7.49 - - Canceled - - - - Expired - - - - Ending outstanding 9,000 $ 7.49 0.4 $ 72 Exercisable at end of period 9,000 $ 7.49 0.4 $ 72
Summary of changes in nonvested shares of restricted share rights	September 30, 2018 Weighted Restricted Average Stock Shares Grant Date and Units Fair Value Unvested at January 1 465,000 $ 7.79 Granted 254,281 13.98 Vested (155,500) 5.14 Forfeited - - Unvested at September 30 563,781 $ 11.31

Earnings Per Share (Tables)

Earnings Per Share (Tables)	9 Months Ended
	Sep. 30, 2018
Earnings Per Share
Schedule of Earnings Per Share	Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Basic earnings per share: Weighted-average common shares outstanding 29,747,078 29,627,086 29,718,191 29,591,811 Net income $ 9,642 $ 8,077 $ 25,392 $ 17,650 Basic earnings per share $ 0.32 $ 0.27 $ 0.85 $ 0.60 Diluted earnings per share: Weighted-average common shares outstanding 29,747,078 29,627,086 29,718,191 29,591,811 Dilutive effect of unvested restricted awards 1 563,781 473,967 525,627 425,081 Dilutive effect of stock options and warrants 73,032 2,556 53,476 2,473 Diluted average common shares outstanding 30,383,891 30,103,609 30,297,294 30,019,365 Net Income $ 9,642 $ 8,077 $ 25,392 $ 17,650 Diluted earnings per share $ 0.32 $ 0.27 $ 0.84 $ 0.59 Number of antidilutive options and warrants excluded from the diluted earnings per share calculation - 900,839 - 900,839 1 Includes the common stock equivalents for restricted share rights that are dilutive .

Regulatory & Capital Matters (T

Regulatory & Capital Matters (Tables)	9 Months Ended
	Sep. 30, 2018
Regulatory & Capital Matters
Schedule of capital levels and industry defined regulatory minimum required levels	Capital levels and industry defined regulatory minimum required levels are as follows: Minimum Capital To Be Well Capitalized Under Adequacy with Capital Prompt Corrective Actual Conservation Buffer if applicable 1 Action Provisions 2 Amount Ratio Amount Ratio Amount Ratio September 30, 2018 Common equity tier 1 capital to risk weighted assets Consolidated $ 196,632 9.12 % $ 137,448 6.375 % N/A N/A Old Second Bank 285,010 13.26 137,024 6.375 $ 139,711 6.50 % Total capital to risk weighted assets Consolidated 270,976 12.57 212,879 9.875 N/A N/A Old Second Bank 304,333 14.16 212,238 9.875 214,924 10.00 Tier 1 capital to risk weighted assets Consolidated 251,653 11.67 169,817 7.875 N/A N/A Old Second Bank 285,010 13.26 169,265 7.875 171,952 8.00 Tier 1 capital to average assets Consolidated 251,653 9.72 103,561 4.00 N/A N/A Old Second Bank 285,010 11.05 103,171 4.00 128,964 5.00 December 31, 2017 Common equity tier 1 capital to risk weighted assets Consolidated $ 179,853 9.25 % $ 111,801 5.750 % N/A N/A Old Second Bank 249,417 12.88 111,347 5.750 $ 125,870 6.50 % Total capital to risk weighted assets Consolidated 251,383 12.93 179,837 9.250 N/A N/A Old Second Bank 266,873 13.78 179,142 9.250 193,667 10.00 Tier 1 capital to risk weighted assets Consolidated 233,927 12.03 140,978 7.250 N/A N/A Old Second Bank 249,417 12.88 140,394 7.250 154,917 8.00 Tier 1 capital to average assets Consolidated 233,927 10.08 92,828 4.00 N/A N/A Old Second Bank 249,417 10.79 92,462 4.00 115,578 5.00 1 As of September 30, 2018, amounts are shown inclusive of a capital conservation buffer of 1.875%; as compared to December 31, 2017, of 1.25%. 2 The Bank exceeded the general minimum regulatory requirements to be considered “well capitalized.”

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	9 Months Ended
	Sep. 30, 2018
Fair Value Measurements
Schedule of balance of assets and liabilities which are measured at fair value on a recurring basis	September 30, 2018 Level 1 Level 2 Level 3 Total Assets: Securities available-for-sale U.S. Treasury $ 3,854 $ - $ - $ 3,854 U.S. government agencies - 11,703 - 11,703 U.S. government agencies mortgage-backed - 14,766 - 14,766 States and political subdivisions - 262,753 9,511 272,264 Collateralized mortgage obligations - 63,396 1,564 64,960 Asset-backed securities - 109,173 - 109,173 Collateralized loan obligations - 65,618 - 65,618 Loans held-for-sale - 2,911 - 2,911 Mortgage servicing rights - - 8,131 8,131 Interest rate swap agreements - 2,803 - 2,803 Mortgage banking derivatives - 151 - 151 Total $ 3,854 $ 533,274 $ 19,206 $ 556,334 Liabilities: Interest rate swap agreements $ - $ 2,803 $ - $ 2,803 Total $ - $ 2,803 $ - $ 2,803 December 31, 2017 Level 1 Level 2 Level 3 Total Assets: Securities available-for-sale U.S. Treasury $ 3,947 $ - $ - $ 3,947 U.S. government agencies - 13,061 - 13,061 U.S. government agencies mortgage-backed - 12,214 - 12,214 States and political subdivisions - 263,831 14,261 278,092 Corporate bonds - 833 - 833 Collateralized mortgage obligations - 63,671 2,268 65,939 Asset-backed securities - 112,932 - 112,932 Collateralized loan obligations - 54,421 - 54,421 Loans held-for-sale - 4,067 - 4,067 Mortgage servicing rights - - 6,944 6,944 Interest rate swap agreements - 727 - 727 Mortgage banking derivatives - 238 - 238 Total $ 3,947 $ 525,995 $ 23,473 $ 553,415 Liabilities: Interest rate swap agreements $ - $ 2,014 $ - $ 2,014 Total $ - $ 2,014 $ - $ 2,014
Schedule of changes in Level 3 assets and liabilities measured at fair value on a recurring basis	Nine Months Ended September 30, 2018 Securities available-for-sale Collateralized States and Mortgage Mortgage Political Servicing Obligation Subdivisions Rights Beginning balance January 1, 2018 $ 2,268 $ 14,261 $ 6,944 Transfers into Level 3 - - - Transfers out of Level 3 - - - Total gains or losses Included in earnings (or changes in net assets) 32 - 636 Included in other comprehensive income 34 (805) - Purchases, issuances, sales, and settlements Purchases - 20,421 - Issuances - - 997 Settlements (770) (24,366) (446) Ending balance September 30, 2018 $ 1,564 $ 9,511 $ 8,131 Nine Months Ended September 30, 2017 Securities available-for-sale Collateralized States and Mortgage Mortgage Political Servicing Obligation Subdivisions Rights Beginning balance January 1, 2017 $ 3,119 $ 22,226 $ 6,489 Transfers into Level 3 - - - Transfers out of Level 3 - - - Total gains or losses Included in earnings (or changes in net assets) 32 - (354) Included in other comprehensive income 7 (501) - Purchases, issuances, sales, and settlements Purchases - 10,994 - Issuances - - 951 Settlements (666) (20,359) (402) Ending balance September 30, 2017 $ 2,492 $ 12,360 $ 6,684
Schedule of quantitative information about level 3 fair value measurements	The following table and commentary presents quantitative and qualitative information about Level 3 fair value measurements as of September 30, 2018: Weighted Measured at fair value Unobservable Average on a recurring basis: Fair Value Valuation Methodology Inputs Range of Input of Inputs Mortgage servicing rights $ 8,131 Discounted Cash Flow Discount Rate 7.0 - 302.1% 10.2 % Prepayment Speed 7.0 - 68.9% 8.1 % The following table and commentary presents quantitative and qualitative information about Level 3 fair value measurements as of December 31, 2017: Weighted Measured at fair value Unobservable Average on a recurring basis: Fair Value Valuation Methodology Inputs Range of Input of Inputs Mortgage servicing rights $ 6,944 Discounted Cash Flow Discount Rate 10.0 - 34.3% 10.2 % Prepayment Speed 7.0 - 68.4% 9.6 %
Schedule of assets measured at fair value on a nonrecurring basis	September 30, 2018 Level 1 Level 2 Level 3 Total Impaired loans 1 $ - $ - $ 9,269 $ 9,269 Other real estate owned, net 2 - - 6,964 6,964 Total $ - $ - $ 16,233 $ 16,233 1 Represents carrying value and related write-downs of loans for which adjustments are substantially based on the appraised value of collateral for collateral-dependent loans; had a carrying amount of $9.6 million and a valuation allowance of $373,000 resulting in an increase of specific allocations within the allowance for loan and lease losses of $229,000 for the nine months ended September 30, 2018. 2 OREO is measured at the lower of carrying or fair value less costs to sell, and had a net carrying amount of $7.0 million, which is made up of the outstanding balance of $15.9 million, net of a valuation allowance of $8.0 million and participations of $937,000 at September 30, 2018. December 31, 2017 Level 1 Level 2 Level 3 Total Impaired loans 1 $ - $ - $ 5,113 $ 5,113 Other real estate owned, net 2 - - 8,371 8,371 Total $ - $ - $ 13,484 $ 13,484 1 Represents carrying value and related write-downs of loans for which adjustments are substantially based on the appraised value of collateral for collateral-dependent loans; had a carrying amount of $5.3 million and a valuation allowance of $144,000, resulting in an increase of specific allocations within the allowance for loan and lease losses of $856,000 for the year December 31, 2017. 2 OREO is measured at the lower of carrying or fair value less costs to sell, and had a net carrying amount of $8.4 million, which is made up of the outstanding balance of $17.5 million, net of a valuation allowance of $8.2 million and participations of $937,000, at December 31, 2017.

Fair Values of Financial Inst_2

Fair Values of Financial Instruments (Tables)	9 Months Ended
	Sep. 30, 2018
Fair Values of Financial Instruments
Schedule of carrying amount and estimated fair values of financial instruments	September 30, 2018 Carrying Fair Amount Value Level 1 Level 2 Level 3 Financial assets: Cash and due from banks $ 34,366 $ 34,366 $ 34,366 $ - $ - Interest bearing deposits with financial institutions 15,956 15,956 15,956 - - Securities available-for-sale 542,338 542,338 3,854 527,409 11,075 FHLBC and FRBC Stock 10,511 10,511 - 10,511 - Loans held-for-sale 2,911 2,911 - 2,911 - Net loans 1,815,621 1,801,489 - - 1,801,489 Interest rate swap agreements 1,135 1,135 - 1,135 Accrued interest receivable 10,460 10,460 - 10,460 - Financial liabilities: Noninterest bearing deposits $ 621,580 $ 621,580 $ 621,580 $ - $ - Interest bearing deposits 1,510,790 1,583,984 - 1,583,984 - Securities sold under repurchase agreements 44,333 44,333 - 44,333 - Other short-term borrowings 81,875 81,875 - 81,875 - Junior subordinated debentures 57,674 59,104 33,336 25,769 - Senior notes 44,133 45,693 - 45,693 - Note payable and other borrowings 18,050 18,050 - 18,050 - Borrowing interest payable 801 801 - 801 - Deposit interest payable 924 924 - 924 - December 31, 2017 Carrying Fair Amount Value Level 1 Level 2 Level 3 Financial assets: Cash and due from banks $ 37,444 $ 37,444 $ 37,444 $ - $ - Interest bearing deposits with financial institutions 18,389 18,389 18,389 - - Securities available-for-sale 541,439 541,439 3,947 520,963 16,529 FHLBC and FRBC Stock 10,168 10,168 - 10,168 - Loans held-for-sale 4,067 4,067 - 4,067 - Net loans 1,600,161 1,586,722 - - 1,586,722 Accrued interest receivable 8,595 8,595 - 8,595 - Financial liabilities: Noninterest bearing deposits $ 572,404 $ 572,404 $ 572,404 $ - $ - Interest bearing deposits 1,350,521 1,346,339 - 1,346,339 - Securities sold under repurchase agreements 29,918 29,918 - 29,918 - Other short-term borrowings 115,000 115,000 - 115,000 - Junior subordinated debentures 57,639 59,471 33,267 26,204 - Subordinated debenture 44,058 46,743 - 46,743 - Interest rate swap agreements 1,287 1,287 - 1,287 - Borrowing interest payable 140 140 - 140 - Deposit interest payable 631 631 - 631 -

Financial Instruments with Of_2

Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions (Tables)	9 Months Ended
	Sep. 30, 2018
Derivatives, Hedging Activities and Financial Instruments with Off-Balance Sheet Risk
Schedule of fair value of derivative financial instruments as well as their classification on the Balance Sheet	Asset Derivatives Liability Derivatives September 30, 2018 December 31, 2017 September 30, 2018 December 31, 2017 No. of Trans. Notional Amount $ Balance Sheet Location Fair Value $ Balance Sheet Location Fair Value $ Balance Sheet Location Fair Value $ Balance Sheet Location Fair Value $ Derivatives designated as hedging instruments Interest rate swaps 25,774 Other Assets 1,135 Other Assets - Other Liabilities - Other Liabilities Total derivatives designated as hedging instruments 1,135 - - Derivatives not designated as hedging instruments Interest rate swaps with commercial loan customers Other Assets 2,803 Other Assets 727 Other Liabilities Other Liabilities 727 Interest rate lock commitments and forward contracts 25,250 Other Assets 151 Other Assets 238 Other Liabilities - Other Liabilities - Other contracts 15,806 Other Assets - Other Assets - Other Liabilities 3 Other Liabilities 13 Total derivatives not designated as hedging instruments 2,954 965 740
Schedule of financial instrument commitments	September 30, 2018 December 31, 2017 Fixed Variable Total Fixed Variable Total Letters of credit: Borrower: Financial standby $ 327 $ 7,165 $ 7,492 $ 177 $ 3,770 $ 3,947 Commercial standby - 388 388 - 354 354 Performance standby 532 7,074 7,606 241 7,594 7,835 859 14,627 15,486 418 11,718 12,136 Non-borrower: Performance standby - 67 67 - 142 142 Total letters of credit $ 859 $ 14,694 $ 15,553 $ 418 $ 11,860 $ 12,278

Summary of Significant Accoun_3

Summary of Significant Accounting Policies - Accounting Pronouncements (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Jan. 01, 2018
Net interest income	$ 28,176,000	$ 22,425,000	$ 78,579,000	$ 64,841,000
Net income	$ 9,642,000	$ 8,077,000	$ 25,392,000	$ 17,650,000
Diluted earnings per share (in dollars per share)	$ 0.32	$ 0.27	$ 0.84	$ 0.59
Accounting Standards Update 2018-02 | Accumulated Other Comprehensive Income (Loss)
Cumulative effect of new accounting principle					$ 319,000
Accounting Standards Update 2018-02 | Retained Earnings
Cumulative effect of new accounting principle					$ (319,000)

Summary of Significant Accoun_4

Summary of Significant Accounting Policies - Dividend (Details) - USD ($)	Nov. 05, 2018	Oct. 16, 2018	Sep. 30, 2018	Jun. 30, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Dec. 31, 2016
Allowance for Loan Losses
Loans and Leases Receivable, Allowance			$ 19,328,000	$ 19,321,000	$ 17,461,000	$ 16,465,000	$ 15,836,000	$ 16,158,000
Subsequent Event
Allowance for Loan Losses
Dividends Payable, Amount Per Share		$ 0.01
Payments of Dividends	$ 298,000
All other
Allowance for Loan Losses
Loans and Leases Receivable, Allowance			$ 1,505,000	$ 868,000	$ 579,000	$ 814,000	$ 546,000	$ 451,000

Acquisitions (Details)

Acquisitions (Details) - GCFC/ABC Bank $ in Thousands	Jun. 30, 2018USD ($)	Apr. 20, 2018USD ($)item	Sep. 30, 2018USD ($)
Business Acquisition [Line Items]
Number of bank branches operated | item		4
Acquisition price		$ 41,100
Net cash paid		47,180
Subordinated debentures retired		6,600
Goodwill			$ 9,900
Core deposit intangible			3,100
Valuation adjustment, fixed assets	$ 1,500
Valuation adjustment, loan valuation mark			11,200
Acquisition expenses			3,300
Total liabilities		289,613
Loans payable			23,500
Assets acquired:
Cash on due from banks		6,669
Interest bearing deposits with financial institutions		500
Securities available-for-sale, at fair value		72,091
Federal funds sold		4,300
FHLBC stock		1,549
Loans		227,594
Premises and equipment		5,339
Other real estate owned		401
Goodwill and core deposit intangible		12,966
Deferred tax assets, net		3,459
Other assets		1,925
Total assets		336,793
Liabilities assumed:
Deposits- noninterest bearing demand		58,005
Deposits- interest bearing - Savings, NOW, Moneymarket		91,494
Deposits - Time		98,999
Total deposits		248,498
Securities sold under repurchase agreements		5,624
Other short-term borrowings		10,875
Notes payable and other borrowings		23,367
Other liabilities		1,249
Total liabilities		289,613
Cash consideration paid		47,180
Total Liabilities Assumed and Cash Consideration Paid for Acquisition		$ 336,793
Salaries and Employee Benefits
Business Acquisition [Line Items]
Acquisition expenses			1,000
Data Processing, Computer and ATM
Business Acquisition [Line Items]
Acquisition expenses			$ 1,800

Acquisition of Loans (Details)

Acquisition of Loans (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Apr. 20, 2018
Business Acquisition [Line Items]
Fair Value	$ 10,887
PCI | GCFC/ABC Bank
Business Acquisition [Line Items]
Fair Value	10,887	$ 11,360
Contractually required principal and interest payments	18,174	19,447
Best estimate of contractual cash flows not expected to be collected	6,069	6,537
Best estimate of contractual cash flows expected to be collected	12,105	12,910
Non-PCI | GCFC/ABC Bank
Business Acquisition [Line Items]
Fair Value	201,289	216,306
Contractually required principal and interest payments	203,156	219,488
Best estimate of contractual cash flows not expected to be collected	1,457	2,511
Best estimate of contractual cash flows expected to be collected	$ 201,699	$ 216,977

Securities - Investment Portfol

Securities - Investment Portfolio (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Securities
Pretax realized losses on sale of available-for-sale securities	$ 10	$ 371	$ 10	$ 1,076
FHLB and FRB Stock
FHLBC stock	4,300		4,300		$ 5,400
FRB stock	$ 6,200		$ 6,200		$ 4,800

Securities - Amortized Cost and

Securities - Amortized Cost and Fair Value (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018USD ($)item	Sep. 30, 2017USD ($)	Sep. 30, 2018USD ($)item	Sep. 30, 2017USD ($)	Dec. 31, 2017USD ($)
Securities Available-for-Sale
Amortized Cost	$ 551,903	$ 551,903	$ 551,903	$ 551,903	$ 537,645
Gross Unrealized Gains	1,669		1,669		8,467
Gross Unrealized Losses	(11,234)		(11,234)		(4,673)
Fair Value	542,338	542,338	542,338	542,338	541,439
Other disclosures
Purchases			71,488	246,971
Sales	$ 1,917	$ 51,620	$ 94,663	$ 152,476
Number of originators | item	3		3
Securities pledged to secure deposits and for other purposes	$ 311,200		$ 311,200		301,000
U.S. Treasury
Securities Available-for-Sale
Amortized Cost	4,005		4,005		4,002
Gross Unrealized Losses	(151)		(151)		(55)
Fair Value	3,854		3,854		3,947
U.S. government agencies
Securities Available-for-Sale
Amortized Cost	11,881		11,881		13,062
Gross Unrealized Gains					8
Gross Unrealized Losses	(178)		(178)		(9)
Fair Value	11,703		11,703		13,061
U.S. government agencies mortgage-backed
Securities Available-for-Sale
Amortized Cost					12,372
Gross Unrealized Gains					7
Gross Unrealized Losses					(165)
Fair Value					12,214
States and political subdivisions
Securities Available-for-Sale
Amortized Cost	278,604		278,604		272,240
Gross Unrealized Gains	398		398		7,116
Gross Unrealized Losses	(6,738)		(6,738)		(1,264)
Fair Value	272,264		272,264		278,092
Corporate bonds
Securities Available-for-Sale
Amortized Cost					823
Gross Unrealized Gains					21
Gross Unrealized Losses					(11)
Fair Value					833
Collateralized mortgage obligations
Securities Available-for-Sale
Amortized Cost	67,762		67,762		66,892
Gross Unrealized Gains	118		118		202
Gross Unrealized Losses	(2,920)		(2,920)		(1,155)
Fair Value	64,960		64,960		65,939
Asset-backed securities
Securities Available-for-Sale
Amortized Cost	108,622		108,622		113,983
Gross Unrealized Gains	991		991		862
Gross Unrealized Losses	(440)		(440)		(1,913)
Fair Value	109,173		109,173		112,932
FFEL
Other disclosures
Asset-backed securities	92,600		$ 92,600
Percentage of outstanding principal amount of loans guaranteed by US Department of Education			97
Total added credit enhancement in the form of overcollaterization and/or subordination of outstanding principal	11,700		$ 11,700
Percentage of total added credit enhancement in the form of overcollaterization and/or subordination of outstanding principal			12.44
FFEL | Reimbursement requests greater than 5 %
Other disclosures
Percentage of outstanding principal amount of loans guaranteed by US Department of Education			85
Percent of insured loan			5
FFEL | Reimbursement requests greater than 9 %
Other disclosures
Percentage of outstanding principal amount of loans guaranteed by US Department of Education			75
Percent of insured loan			9
Collateralized loan obligations
Securities Available-for-Sale
Amortized Cost	65,555		$ 65,555		54,271
Gross Unrealized Gains	162		162		251
Gross Unrealized Losses	(99)		(99)		(101)
Fair Value	65,618		65,618		$ 54,421
U.S. government agency mortgage-backed
Securities Available-for-Sale
Amortized Cost	15,474		15,474
Gross Unrealized Losses	(708)		(708)
Fair Value	14,766		14,766
GCO Education Loan Funding Corp
Securities Available-for-Sale
Amortized Cost	27,711		27,711
Fair Value	27,788		27,788
Towd Point Mortgage Trust
Securities Available-for-Sale
Amortized Cost	34,390		34,390
Fair Value	33,181		$ 33,181
Towd Point Mortgage Trust | Stockholders' Equity
Other disclosures
Credit risk as a percentage of benchmark			10.00%
Student Marketing Association [Member]
Securities Available-for-Sale
Amortized Cost	25,798		$ 25,798
Fair Value	$ 26,134		$ 26,134
Stockholders' Equity | GCO Education Loan Funding Corp
Other disclosures
Credit risk as a percentage of benchmark			10.00%

Securities - Contractural Matur

Securities - Contractural Maturities (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2017	Sep. 30, 2018	Dec. 31, 2017
Securities Available-for-Sale, Amortized Cost
Due in one year or less	$ 1,500
Due after one year through five years	4,005
Due after five years through ten years	6,688
Due after ten years	282,297
Debt securities excluding securities not due at a single maturity date	294,490
Total	$ 551,903	$ 551,903	$ 537,645
Securities Available-for-Sale, Weighted Average Yield
Due in one year or less (as a percent)	4.78%
Due after one year through five years (as a percent)	1.85%
Due after five years through ten years (as a percent)	3.03%
Due after ten years (as a percent)	3.00%
Debt securities (as a percent)	3.00%
Total (as a percent)	3.28%
Securities Available-for-Sale, Fair Value
Due in one year or less	$ 1,502
Due after one year through five years	3,854
Due after five years through ten years	6,626
Due after ten years	275,839
Debt securities	287,821
Fair Value	542,338	542,338	541,439
Collateralized mortgage obligations
Securities Available-for-Sale, Amortized Cost
Total		67,762	66,892
Securities Available-for-Sale, Fair Value
Fair Value		64,960	65,939
Asset-backed securities
Securities Available-for-Sale, Amortized Cost
Securities not due at a single maturity date	$ 108,622
Total		108,622	113,983
Securities Available-for-Sale, Weighted Average Yield
Securities not due at a single maturity date, Weighted Average Yield (as a percent)	3.22%
Securities Available-for-Sale, Fair Value
Securities not due at a single maturity date	$ 109,173
Fair Value		109,173	112,932
Collateralized loan obligations
Securities Available-for-Sale, Amortized Cost
Securities not due at a single maturity date	$ 65,555
Total		65,555	54,271
Securities Available-for-Sale, Weighted Average Yield
Securities not due at a single maturity date, Weighted Average Yield (as a percent)	4.71%
Securities Available-for-Sale, Fair Value
Securities not due at a single maturity date	$ 65,618
Fair Value		$ 65,618	$ 54,421
Mortgage-backed and collateralized mortgage obligations
Securities Available-for-Sale, Amortized Cost
Securities not due at a single maturity date	$ 83,236
Securities Available-for-Sale, Weighted Average Yield
Securities not due at a single maturity date, Weighted Average Yield (as a percent)	3.21%
Securities Available-for-Sale, Fair Value
Securities not due at a single maturity date	$ 79,726

Securities - Unrealized Loss Po

Securities - Unrealized Loss Positions (Details) $ in Thousands	Sep. 30, 2018USD ($)security	Dec. 31, 2017USD ($)security
Securities Available-for-Sale, Number of Securities
Less than 12 months in an unrealized loss position | security	75	26
Greater than 12 months in an unrealized loss position | security	32	22
Total | security	107	48
Securities Available-for-Sale, Unrealized Losses
Less than 12 months in an unrealized loss position	$ 5,117	$ 1,457
Greater than 12 months in an unrealized loss position	6,117	3,216
Total	11,234	4,673
Securities Available-for-Sale, Fair Value
Less than 12 months in an unrealized loss position	247,758	102,830
Greater than 12 months in an unrealized loss position	114,923	108,651
Total	$ 362,681	$ 211,481
U.S. Treasury
Securities Available-for-Sale, Number of Securities
Less than 12 months in an unrealized loss position | security		1
Greater than 12 months in an unrealized loss position | security	1
Total | security	1	1
Securities Available-for-Sale, Unrealized Losses
Less than 12 months in an unrealized loss position		$ 55
Greater than 12 months in an unrealized loss position	$ 151
Total	151	55
Securities Available-for-Sale, Fair Value
Less than 12 months in an unrealized loss position		3,947
Greater than 12 months in an unrealized loss position	3,854
Total	$ 3,854	$ 3,947
U.S. government agencies
Securities Available-for-Sale, Number of Securities
Less than 12 months in an unrealized loss position | security	3	2
Greater than 12 months in an unrealized loss position | security	1
Total | security	4	2
Securities Available-for-Sale, Unrealized Losses
Less than 12 months in an unrealized loss position	$ 109	$ 9
Greater than 12 months in an unrealized loss position	69
Total	178	9
Securities Available-for-Sale, Fair Value
Less than 12 months in an unrealized loss position	7,829	6,550
Greater than 12 months in an unrealized loss position	3,874
Total	$ 11,703	$ 6,550
U.S. government agency mortgage-backed
Securities Available-for-Sale, Number of Securities
Less than 12 months in an unrealized loss position | security	6	4
Greater than 12 months in an unrealized loss position | security	7	5
Total | security	13	9
Securities Available-for-Sale, Unrealized Losses
Less than 12 months in an unrealized loss position	$ 287	$ 24
Greater than 12 months in an unrealized loss position	421	141
Total	708	165
Securities Available-for-Sale, Fair Value
Less than 12 months in an unrealized loss position	7,357	5,501
Greater than 12 months in an unrealized loss position	7,409	4,843
Total	$ 14,766	$ 10,344
States and political subdivisions
Securities Available-for-Sale, Number of Securities
Less than 12 months in an unrealized loss position | security	55	13
Greater than 12 months in an unrealized loss position | security	9	1
Total | security	64	14
Securities Available-for-Sale, Unrealized Losses
Less than 12 months in an unrealized loss position	$ 3,843	$ 1,237
Greater than 12 months in an unrealized loss position	2,895	27
Total	6,738	1,264
Securities Available-for-Sale, Fair Value
Less than 12 months in an unrealized loss position	174,924	45,985
Greater than 12 months in an unrealized loss position	28,218	1,512
Total	$ 203,142	$ 47,497
Corporate bonds
Securities Available-for-Sale, Number of Securities
Greater than 12 months in an unrealized loss position | security		1
Total | security		1
Securities Available-for-Sale, Unrealized Losses
Greater than 12 months in an unrealized loss position		$ 11
Total		11
Securities Available-for-Sale, Fair Value
Greater than 12 months in an unrealized loss position		332
Total		$ 332
Collateralized mortgage obligations
Securities Available-for-Sale, Number of Securities
Less than 12 months in an unrealized loss position | security	4	3
Greater than 12 months in an unrealized loss position | security	8	8
Total | security	12	11
Securities Available-for-Sale, Unrealized Losses
Less than 12 months in an unrealized loss position	$ 714	$ 31
Greater than 12 months in an unrealized loss position	2,206	1,124
Total	2,920	1,155
Securities Available-for-Sale, Fair Value
Less than 12 months in an unrealized loss position	25,620	11,534
Greater than 12 months in an unrealized loss position	33,342	40,219
Total	$ 58,962	$ 51,753
Asset-backed securities
Securities Available-for-Sale, Number of Securities
Less than 12 months in an unrealized loss position | security	3
Greater than 12 months in an unrealized loss position | security	5	7
Total | security	8	7
Securities Available-for-Sale, Unrealized Losses
Less than 12 months in an unrealized loss position	$ 79
Greater than 12 months in an unrealized loss position	361	$ 1,913
Total	440	1,913
Securities Available-for-Sale, Fair Value
Less than 12 months in an unrealized loss position	7,526
Greater than 12 months in an unrealized loss position	30,240	61,745
Total	$ 37,766	$ 61,745
Collateralized loan obligations
Securities Available-for-Sale, Number of Securities
Less than 12 months in an unrealized loss position | security	4	3
Greater than 12 months in an unrealized loss position | security	1
Total | security	5	3
Securities Available-for-Sale, Unrealized Losses
Less than 12 months in an unrealized loss position	$ 85	$ 101
Greater than 12 months in an unrealized loss position	14
Total	99	101
Securities Available-for-Sale, Fair Value
Less than 12 months in an unrealized loss position	24,502	29,313
Greater than 12 months in an unrealized loss position	7,986
Total	$ 32,488	$ 29,313

Securities - Realized Gain (Los

Securities - Realized Gain (Loss) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Securities
Sales	$ 1,917	$ 51,620	$ 94,663	$ 152,476
Gross realized gains on securities	23	474	370	911
Gross realized losses on securities	(10)	(371)	(10)	(1,076)
Securities (losses) gains, net	13	103	360	(165)
Income tax (expense) benefit on net realized gains (losses)	(2)	$ (42)	(100)	$ 24
Available-for-sale Securities Pledged as Collateral	$ 311,200		$ 311,200		$ 301,000

Loans - Major Classifications (

Loans - Major Classifications (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017	Sep. 30, 2017
Loans
Total loans, gross	$ 1,822,714	$ 1,616,942
Net deferred loan fees	1,348	680
PCI loans, net of purchase accounting adjustments	10,887
Total Loans	1,834,949	1,617,622	$ 1,594,191
Other
Loans
Total loans, gross	12,969	13,383
PCI
Loans
Total Loans	10,887
Non-PCI
Loans
Total Loans	1,824,062	1,617,622
Commercial
Loans
Total loans, gross	306,407	272,851
Total Loans	306,407	272,851	257,356
Real estate - commercial
Loans
Total loans, gross	804,184	750,991
PCI loans, net of purchase accounting adjustments	4,126
Total Loans			739,136
Real estate - commercial | Construction Loans
Loans
Total loans, gross	112,873	85,162
PCI loans, net of purchase accounting adjustments	778
Total Loans			94,868
Real estate - residential
Loans
Total loans, gross	393,598	313,397
PCI loans, net of purchase accounting adjustments	5,983
Total Loans			303,080
Real estate - residential | Home Equity Line of Credit
Loans
Total Loans	122,022	112,833
Consumer
Loans
Total Loans			116,503
Consumer | Home Equity Line of Credit
Loans
Total loans, gross	122,022	112,833
Lease financing receivables
Loans
Total loans, gross	70,661	68,325
Total Loans	$ 70,661	$ 68,325	$ 69,305

Loans - Major Classifications -

Loans - Major Classifications - Loan Concentrations (Details) - Total real estate - Loan receivables - Customer concentration risk	3 Months Ended	9 Months Ended
	Sep. 30, 2017	Sep. 30, 2018
Loans
Credit risk as a percentage of benchmark	78.00%
Loans receivable as a percentage of total portfolio		78.10%

Loans - Aging Analysis (Details

Loans - Aging Analysis (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017	Sep. 30, 2017
Aged analysis of past due loans
Total Past Due	$ 16,881	$ 5,606
Current	1,805,789	1,597,628
Nonaccrual	12,279	14,388
Total Loans	1,834,949	1,617,622	$ 1,594,191
Recorded Investment 90 days or Greater Past Due and Accruing	82	254
30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	13,151	4,212
60 to 89 Days Past Due
Aged analysis of past due loans
Total Past Due	3,651	1,146
90 Days or Greater Past Due
Aged analysis of past due loans
Total Past Due	79	248
PCI
Aged analysis of past due loans
Total Past Due	3,415
Current	5,174
Nonaccrual	2,298
Total Loans	10,887
PCI | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	3,415
Non-PCI
Aged analysis of past due loans
Total Past Due	13,466
Current	1,800,615
Nonaccrual	9,981
Total Loans	1,824,062	1,617,622
Recorded Investment 90 days or Greater Past Due and Accruing	82
Non-PCI | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	9,736
Non-PCI | 60 to 89 Days Past Due
Aged analysis of past due loans
Total Past Due	3,651
Non-PCI | 90 Days or Greater Past Due
Aged analysis of past due loans
Total Past Due	79
Multifamily
Aged analysis of past due loans
Total Past Due	1,377
Current	179,645	125,049
Nonaccrual		4,723
Total Loans	181,022	129,772
Recorded Investment 90 days or Greater Past Due and Accruing	76
Multifamily | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	1,304
Multifamily | 90 Days or Greater Past Due
Aged analysis of past due loans
Total Past Due	73
Commercial
Aged analysis of past due loans
Total Past Due	1,080	1,270
Current	305,327	271,581
Total Loans	306,407	272,851	257,356
Recorded Investment 90 days or Greater Past Due and Accruing	6
Commercial | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	1,074	995
Commercial | 60 to 89 Days Past Due
Aged analysis of past due loans
Total Past Due		275
Commercial | 90 Days or Greater Past Due
Aged analysis of past due loans
Total Past Due	6
Lease financing receivables
Aged analysis of past due loans
Current	70,661	68,147
Nonaccrual		178
Total Loans	70,661	68,325	69,305
Real estate - commercial
Aged analysis of past due loans
Total Loans			739,136
Real estate - commercial | Owner occupied general purpose
Aged analysis of past due loans
Total Past Due	1,022	1,136
Current	164,304	144,267
Nonaccrual	1,625	455
Total Loans	166,951	145,858
Real estate - commercial | Owner occupied general purpose | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	1,022	1,136
Real estate - commercial | Owner occupied special purpose
Aged analysis of past due loans
Total Past Due	891	226
Current	188,984	170,546
Nonaccrual	410	342
Total Loans	190,285	171,114
Real estate - commercial | Owner occupied special purpose | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	891	226
Real estate - commercial | Non-owner occupied general purpose
Aged analysis of past due loans
Total Past Due	3,768	593
Current	293,979	273,203
Nonaccrual	142	1,163
Total Loans	297,889	274,959
Real estate - commercial | Non-owner occupied general purpose | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	346
Real estate - commercial | Non-owner occupied general purpose | 60 to 89 Days Past Due
Aged analysis of past due loans
Total Past Due	3,422	593
Real estate - commercial | Non-owner occupied special purpose
Aged analysis of past due loans
Total Past Due		248
Current	85,171	92,923
Nonaccrual	3,099
Total Loans	88,270	93,171
Recorded Investment 90 days or Greater Past Due and Accruing		254
Real estate - commercial | Non-owner occupied special purpose | 90 Days or Greater Past Due
Aged analysis of past due loans
Total Past Due		248
Real estate - commercial | Retail properties
Aged analysis of past due loans
Total Past Due	624
Current	46,252	49,538
Nonaccrual		1,081
Total Loans	46,876	50,619
Real estate - commercial | Retail properties | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	624
Real estate - commercial | Farm
Aged analysis of past due loans
Total Past Due	1,241
Current	12,672	15,270
Total Loans	13,913	15,270
Real estate - commercial | Farm | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	1,241
Real estate - commercial | Construction Loans
Aged analysis of past due loans
Total Loans			94,868
Real estate - commercial | Construction Loans | Homebuilder
Aged analysis of past due loans
Total Past Due		129
Current	4,556	2,221
Total Loans	4,556	2,350
Real estate - commercial | Construction Loans | Homebuilder | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due		129
Real estate - commercial | Construction Loans | Land
Aged analysis of past due loans
Total Past Due		1,124
Current	3,841	1,319
Total Loans	3,841	2,443
Real estate - commercial | Construction Loans | Land | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due		1,124
Real estate - commercial | Construction Loans | Commercial speculative
Aged analysis of past due loans
Current	56,052	32,028
Total Loans	56,052	32,028
Real estate - commercial | Construction Loans | All other
Aged analysis of past due loans
Total Past Due	38
Current	48,277	48,140
Nonaccrual	109	201
Total Loans	48,424	48,341
Real estate - commercial | Construction Loans | All other | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	38
Real estate - residential
Aged analysis of past due loans
Total Loans			303,080
Real estate - residential | Investor
Aged analysis of past due loans
Total Past Due	952
Current	70,102	55,248
Nonaccrual	364	372
Total Loans	71,418	55,620
Real estate - residential | Investor | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	952
Real estate - residential | Owner occupied
Aged analysis of past due loans
Total Past Due	916	74
Current	136,678	123,257
Nonaccrual	3,564	4,674
Total Loans	141,158	128,005
Real estate - residential | Owner occupied | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	780	74
Real estate - residential | Owner occupied | 60 to 89 Days Past Due
Aged analysis of past due loans
Total Past Due	136
Real estate - residential | Home Equity Line of Credit
Aged analysis of past due loans
Total Past Due	1,514	769
Current	119,880	110,872
Nonaccrual	628	1,192
Total Loans	122,022	112,833
Real estate - residential | Home Equity Line of Credit | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	1,422	491
Real estate - residential | Home Equity Line of Credit | 60 to 89 Days Past Due
Aged analysis of past due loans
Total Past Due	92	278
Consumer
Aged analysis of past due loans
Total Loans			116,503
All other
Aged analysis of past due loans
Total Past Due	43	37
Current	14,234	14,019
Nonaccrual	40	7
Total Loans	14,317	14,063	$ 13,943
All other | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	42	$ 37
All other | 60 to 89 Days Past Due
Aged analysis of past due loans
Total Past Due	$ 1

Loans - Inclusion (Details)

Loans - Inclusion (Details)	9 Months Ended
	Sep. 30, 2018USD ($)
Minimum
Loans by risk rating
Loan commitment for inclusion in credit quality analysis	$ 50,000

Loans - Credit Quality (Details

Loans - Credit Quality (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017	Sep. 30, 2017
Loans by risk rating
Total Loans	$ 1,834,949	$ 1,617,622	$ 1,594,191
Multifamily
Loans by risk rating
Total Loans	181,022	129,772
Commercial
Loans by risk rating
Total Loans	306,407	272,851	257,356
Lease financing receivables
Loans by risk rating
Total Loans	70,661	68,325	69,305
Real estate - commercial
Loans by risk rating
Total Loans			739,136
Real estate - commercial | Owner occupied general purpose
Loans by risk rating
Total Loans	166,951	145,858
Real estate - commercial | Owner occupied special purpose
Loans by risk rating
Total Loans	190,285	171,114
Real estate - commercial | Non-owner occupied general purpose
Loans by risk rating
Total Loans	297,889	274,959
Real estate - commercial | Non-owner occupied special purpose
Loans by risk rating
Total Loans	88,270	93,171
Real estate - commercial | Retail properties
Loans by risk rating
Total Loans	46,876	50,619
Real estate - commercial | Farm
Loans by risk rating
Total Loans	13,913	15,270
Real estate - residential
Loans by risk rating
Total Loans			303,080
Real estate - residential | Investor
Loans by risk rating
Total Loans	71,418	55,620
Real estate - residential | Owner occupied
Loans by risk rating
Total Loans	141,158	128,005
Consumer
Loans by risk rating
Total Loans			116,503
All other
Loans by risk rating
Total Loans	14,317	14,063	13,943
Pass
Loans by risk rating
Total Loans	1,776,635	1,583,352
Pass | Multifamily
Loans by risk rating
Total Loans	177,845	125,049
Pass | Commercial
Loans by risk rating
Total Loans	303,176	270,889
Pass | Lease financing receivables
Loans by risk rating
Total Loans	70,661	67,500
Pass | Real estate - commercial | Owner occupied general purpose
Loans by risk rating
Total Loans	160,999	142,843
Pass | Real estate - commercial | Owner occupied special purpose
Loans by risk rating
Total Loans	183,375	169,621
Pass | Real estate - commercial | Non-owner occupied general purpose
Loans by risk rating
Total Loans	289,438	271,731
Pass | Real estate - commercial | Non-owner occupied special purpose
Loans by risk rating
Total Loans	83,648	89,582
Pass | Real estate - commercial | Retail properties
Loans by risk rating
Total Loans	45,074	48,321
Pass | Real estate - commercial | Farm
Loans by risk rating
Total Loans	11,423	11,755
Pass | Real estate - residential | Investor
Loans by risk rating
Total Loans	70,315	55,172
Pass | Real estate - residential | Owner occupied
Loans by risk rating
Total Loans	135,625	122,178
Pass | All other
Loans by risk rating
Total Loans	14,262	14,043
Special Mention
Loans by risk rating
Total Loans	13,357	10,965
Special Mention | Commercial
Loans by risk rating
Total Loans	2,878	1,962
Special Mention | Real estate - commercial | Owner occupied general purpose
Loans by risk rating
Total Loans	1,489	1,927
Special Mention | Real estate - commercial | Owner occupied special purpose
Loans by risk rating
Total Loans	2,883	1,152
Special Mention | Real estate - commercial | Non-owner occupied general purpose
Loans by risk rating
Total Loans	834	2,065
Special Mention | Real estate - commercial | Non-owner occupied special purpose
Loans by risk rating
Total Loans	1,523
Special Mention | Real estate - commercial | Retail properties
Loans by risk rating
Total Loans		1,217
Special Mention | Real estate - commercial | Farm
Loans by risk rating
Total Loans	1,249	1,029
Special Mention | Real estate - residential | Owner occupied
Loans by risk rating
Total Loans	511	561
Substandard
Loans by risk rating
Total Loans	44,957	23,305
Substandard | Multifamily
Loans by risk rating
Total Loans	3,177	4,723
Substandard | Commercial
Loans by risk rating
Total Loans	353
Substandard | Lease financing receivables
Loans by risk rating
Total Loans		825
Substandard | Real estate - commercial | Owner occupied general purpose
Loans by risk rating
Total Loans	4,463	1,088
Substandard | Real estate - commercial | Owner occupied special purpose
Loans by risk rating
Total Loans	4,027	341
Substandard | Real estate - commercial | Non-owner occupied general purpose
Loans by risk rating
Total Loans	7,617	1,163
Substandard | Real estate - commercial | Non-owner occupied special purpose
Loans by risk rating
Total Loans	3,099	3,589
Substandard | Real estate - commercial | Retail properties
Loans by risk rating
Total Loans	1,802	1,081
Substandard | Real estate - commercial | Farm
Loans by risk rating
Total Loans	1,241	2,486
Substandard | Real estate - residential | Investor
Loans by risk rating
Total Loans	1,103	448
Substandard | Real estate - residential | Owner occupied
Loans by risk rating
Total Loans	5,022	5,266
Substandard | All other
Loans by risk rating
Total Loans	55	20
PCI
Loans by risk rating
Total Loans	10,887
PCI | Substandard
Loans by risk rating
Total Loans	10,887
Non-PCI
Loans by risk rating
Total Loans	1,824,062	1,617,622
Non-PCI | Pass
Loans by risk rating
Total Loans	1,776,635
Non-PCI | Special Mention
Loans by risk rating
Total Loans	13,357
Non-PCI | Substandard
Loans by risk rating
Total Loans	34,070
Construction Loans | Real estate - commercial
Loans by risk rating
Total Loans			$ 94,868
Construction Loans | Real estate - commercial | Homebuilder
Loans by risk rating
Total Loans	4,556	2,350
Construction Loans | Real estate - commercial | Land
Loans by risk rating
Total Loans	3,841	2,443
Construction Loans | Real estate - commercial | Commercial speculative
Loans by risk rating
Total Loans	56,052	32,028
Construction Loans | Real estate - commercial | All other
Loans by risk rating
Total Loans	48,424	48,341
Construction Loans | Pass | Real estate - commercial | Homebuilder
Loans by risk rating
Total Loans	4,556	2,350
Construction Loans | Pass | Real estate - commercial | Land
Loans by risk rating
Total Loans	3,841	2,443
Construction Loans | Pass | Real estate - commercial | Commercial speculative
Loans by risk rating
Total Loans	56,052	32,028
Construction Loans | Pass | Real estate - commercial | All other
Loans by risk rating
Total Loans	46,152	46,913
Construction Loans | Special Mention | Real estate - commercial | All other
Loans by risk rating
Total Loans	1,990	1,052
Construction Loans | Substandard | Real estate - commercial | All other
Loans by risk rating
Total Loans	282	376
Home Equity Line of Credit | Real estate - residential
Loans by risk rating
Total Loans	122,022	112,833
Home Equity Line of Credit | Pass | Real estate - residential
Loans by risk rating
Total Loans	120,193	110,934
Home Equity Line of Credit | Substandard | Real estate - residential
Loans by risk rating
Total Loans	$ 1,829	$ 1,899

Loans - Repossessed Assets (Det

Loans - Repossessed Assets (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Jun. 30, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Dec. 31, 2016
Repossessed and foreclosed assets
Other real estate owned	$ 6,964	$ 8,912	$ 8,371	$ 9,024	$ 11,724	$ 11,916
Real estate - residential
Repossessed and foreclosed assets
Mortgage loans in process of foreclosure		$ 1,000	$ 1,300

Loans - Impaired Loans - Record

Loans - Impaired Loans - Recorded Investment, Unpaid Principal Balance and Related Allowance (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Recorded Investment
With no related allowance recorded	$ 7,083	$ 14,855
With an allowance recorded	9,642	5,257
Total impaired loans	16,725	20,112
Unpaid Principal Balance
With no related allowance recorded	9,015	17,792
With an allowance recorded	10,118	5,257
Total impaired loans	19,133	23,049
Related Allowance
With an allowance recorded	373	144
Lease financing receivables
Recorded Investment
With no related allowance recorded		178
Unpaid Principal Balance
With no related allowance recorded		213
Real estate - commercial | Owner occupied general purpose
Recorded Investment
With no related allowance recorded	1,614	455
With an allowance recorded	518
Unpaid Principal Balance
With no related allowance recorded	1,699	495
With an allowance recorded	518
Related Allowance
With an allowance recorded	46
Real estate - commercial | Owner occupied special purpose
Recorded Investment
With no related allowance recorded	409	342
Unpaid Principal Balance
With no related allowance recorded	538	498
Real estate - commercial | Non-owner occupied general purpose
Recorded Investment
With no related allowance recorded	142	1,163
Unpaid Principal Balance
With no related allowance recorded	158	1,538
Real estate - commercial | Non-owner occupied special purpose
Recorded Investment
With an allowance recorded	3,099
Unpaid Principal Balance
With an allowance recorded	3,575
Related Allowance
With an allowance recorded	139
Real estate - commercial | Retail properties
Recorded Investment
With no related allowance recorded		1,081
Unpaid Principal Balance
With no related allowance recorded		1,177
Real estate - residential | Investor
Recorded Investment
With no related allowance recorded	365	372
With an allowance recorded	810	829
Unpaid Principal Balance
With no related allowance recorded	466	676
With an allowance recorded	810	829
Related Allowance
With an allowance recorded	10	10
Real estate - residential | Multifamily
Recorded Investment
With no related allowance recorded		4,723
Unpaid Principal Balance
With no related allowance recorded		4,965
Real estate - residential | Owner occupied
Recorded Investment
With no related allowance recorded	3,855	5,208
With an allowance recorded	3,710	3,443
Unpaid Principal Balance
With no related allowance recorded	5,326	6,680
With an allowance recorded	3,710	3,443
Related Allowance
With an allowance recorded	49	43
Real estate - residential | Revolving and junior liens
Recorded Investment
With no related allowance recorded	634	1,125
With an allowance recorded	1,420	985
Unpaid Principal Balance
With no related allowance recorded	739	1,313
With an allowance recorded	1,420	985
Related Allowance
With an allowance recorded	61	91
Consumer
Recorded Investment
With no related allowance recorded	14	7
With an allowance recorded	26
Unpaid Principal Balance
With no related allowance recorded	15	8
With an allowance recorded	26
Related Allowance
With an allowance recorded	26
Construction Loans | Real estate - commercial | All other
Recorded Investment
With no related allowance recorded	50	201
With an allowance recorded	59
Unpaid Principal Balance
With no related allowance recorded	74	$ 229
With an allowance recorded	59
Related Allowance
With an allowance recorded	$ 42

Loans - Impaired Loans - Averag

Loans - Impaired Loans - Average Recorded Investment and Interest Income Recognized (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Average Recorded Investment
With no related allowance recorded	$ 7,012	$ 20,197	$ 10,340	$ 20,636
With an allowance recorded	9,263	145	7,450	551
Total impaired loans	16,275	20,342	17,790	21,187
Interest Income Recognized
With no related allowance recorded	13	83	35	184
With an allowance recorded	85	2	204	2
Total impaired loans	98	85	239	186
Commercial
Average Recorded Investment
With no related allowance recorded		212		123
Lease financing receivables
Average Recorded Investment
With no related allowance recorded		208		281
With an allowance recorded		120
Real estate - commercial | Owner occupied general purpose
Average Recorded Investment
With no related allowance recorded	1,263	458	1,035	1,169
With an allowance recorded	259		259
Interest Income Recognized
With no related allowance recorded	2		5
With an allowance recorded	22		22
Real estate - commercial | Owner occupied special purpose
Average Recorded Investment
With no related allowance recorded	417	363	375	372
Real estate - commercial | Non-owner occupied general purpose
Average Recorded Investment
With no related allowance recorded	91	1,180	653	1,481
With an allowance recorded				123
Interest Income Recognized
With no related allowance recorded		1		2
Real estate - commercial | Non-owner occupied special purpose
Average Recorded Investment
With no related allowance recorded				507
With an allowance recorded	3,099		1,550
Real estate - commercial | Retail properties
Average Recorded Investment
With no related allowance recorded		1,129		1,146
Real estate - residential | Investor
Average Recorded Investment
With no related allowance recorded	368	1,475	369	1,607
With an allowance recorded	812		820
Interest Income Recognized
With no related allowance recorded		16		36
With an allowance recorded	11		33
Real estate - residential | Multifamily
Average Recorded Investment
With no related allowance recorded		4,791	2,361	2,379
Real estate - residential | Owner occupied
Average Recorded Investment
With no related allowance recorded	4,050	8,179	4,532	8,987
With an allowance recorded	3,678		3,576	402
Interest Income Recognized
With no related allowance recorded	11	54	29	119
With an allowance recorded	35		108
Real estate - residential | Revolving and junior liens
Average Recorded Investment
With no related allowance recorded	687	1,981	880	2,237
With an allowance recorded	1,371	25	1,203	26
Interest Income Recognized
With no related allowance recorded		12	1	27
With an allowance recorded	17	2	41	2
Consumer
Average Recorded Investment
With no related allowance recorded	15	9	10	104
With an allowance recorded	14		13
Construction Loans | Real estate - commercial | Commercial speculative
Average Recorded Investment
With no related allowance recorded		34		37
Construction Loans | Real estate - commercial | All other
Average Recorded Investment
With no related allowance recorded	121	$ 178	125	$ 206
With an allowance recorded	$ 30		$ 29

Loans - TDR (Details)

Loans - TDR (Details)	3 Months Ended		9 Months Ended
	Sep. 30, 2018USD ($)contract	Sep. 30, 2017USD ($)contract	Sep. 30, 2018USD ($)contract	Sep. 30, 2017USD ($)contract	Dec. 31, 2017USD ($)
Troubled debt restructurings - modified during the period
# of contracts | contract	6		17
Pre-modification recorded investment	$ 791,000	$ 155,000	$ 1,600,000	$ 399,000
Post-modification recorded investment	782,000	$ 147,000	1,473,000	$ 388,000
TDR's defaulted
# of contracts | contract		2		6
Pre-modification outstanding recorded investment during the period			0	$ 0
Other information
Total Past Due	$ 16,881,000		$ 16,881,000		$ 5,606,000
Other
Troubled debt restructurings - modified during the period
# of contracts | contract	1		1
Pre-modification recorded investment	$ 427,000		$ 427,000
Post-modification recorded investment	$ 424,000		$ 424,000
HAMP
Troubled debt restructurings - modified during the period
# of contracts | contract	1		1
Pre-modification recorded investment	$ 26,000		$ 26,000
Post-modification recorded investment	26,000		$ 26,000
Real estate - commercial
Troubled debt restructurings - modified during the period
# of contracts | contract			1
Pre-modification recorded investment			$ 110,000
Post-modification recorded investment			52,000
Real estate - commercial | Owner occupied special purpose
Other information
Total Past Due	891,000		891,000		226,000
Real estate - commercial | Owner occupied general purpose
Other information
Total Past Due	1,022,000		1,022,000		1,136,000
Real estate - commercial | Non-owner occupied general purpose
Other information
Total Past Due	$ 3,768,000		$ 3,768,000		593,000
Real estate - residential | Other
Troubled debt restructurings - modified during the period
# of contracts | contract	1		1
Pre-modification recorded investment	$ 34,000		$ 34,000
Post-modification recorded investment	$ 29,000		$ 29,000
Real estate - residential | HAMP
Troubled debt restructurings - modified during the period
# of contracts | contract	1		3
Pre-modification recorded investment	$ 211,000		$ 383,000
Post-modification recorded investment	211,000		$ 331,000
Real estate - residential | Interest Rate Concession Below Normal Market [Member]
Troubled debt restructurings - modified during the period
# of contracts | contract			1
Pre-modification recorded investment			$ 24,000
Post-modification recorded investment			24,000
Real estate - residential | Investor
Other information
Total Past Due	952,000		952,000
Real estate - residential | Owner occupied
Other information
Total Past Due	$ 916,000		$ 916,000		74,000
Real estate - residential | Revolving and junior liens | Other
Troubled debt restructurings - modified during the period
# of contracts | contract	2		9
Pre-modification recorded investment	$ 93,000	$ 155,000	$ 596,000	399,000
Post-modification recorded investment	92,000	$ 147,000	587,000	$ 388,000
TDR's defaulted
# of contracts | contract		2		6
Commercial
Other information
Total Past Due	1,080,000		1,080,000		1,270,000
90 Days or Greater Past Due
Other information
Total Past Due	79,000		79,000		$ 248,000
90 Days or Greater Past Due | Commercial
Other information
Total Past Due	$ 6,000		$ 6,000

Loans - Accretable Discount on

Loans - Accretable Discount on Purchased Loans (Details) $ in Thousands	3 Months Ended
	Sep. 30, 2018USD ($)
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward]
Beginning balance	$ 10,771
Accretion	(775)
Transfers	(399)
Ending balance	9,597
PCI
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward]
Beginning balance	1,373
Beginning balance	6,403
Accretion	(129)
Accretion	(334)
Transfers	(26)
Ending balance	1,218
Ending balance	6,069
Non-PCI
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward]
Beginning balance	2,995
Accretion	(312)
Transfers	(373)
Ending balance	$ 2,310

Allowance for Loan Losses (Deta

Allowance for Loan Losses (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Allowance for loan losses:
Beginning Balance	$ 19,321	$ 15,836	$ 17,461	$ 16,158
Charge-offs	372	241	1,046	1,998
Recoveries	379	570	2,185	1,255
Provision (release)		300	728	1,050
Ending Balance	19,328	16,465	19,328	16,465
Ending balance: Individually evaluated for impairment	373	6	373	6
Ending balance: Collectively evaluated for impairment	18,955	16,459	18,955	16,459
Loans:
Ending balance	1,834,949	1,594,191	1,834,949	1,594,191	$ 1,617,622
Ending balance	1,834,949		1,834,949
Ending balance: Individually evaluated for impairment	16,725	20,086	16,725	20,086
Ending balance: Collectively evaluated for impairment	1,807,337	1,574,105	1,807,337	1,574,105
Ending balance: Acquired and accounted for ASC 310-30	10,887		10,887
Commercial
Allowance for loan losses:
Beginning Balance	2,676	2,150	2,453	1,629
Charge-offs	7	13	38	20
Recoveries	32	6	141	13
Provision (release)	96	(104)	241	417
Ending Balance	2,797	2,039	2,797	2,039
Ending balance: Collectively evaluated for impairment	2,797	2,039	2,797	2,039
Loans:
Ending balance	306,407	257,356	306,407	257,356	272,851
Ending balance	306,407		306,407
Ending balance: Individually evaluated for impairment		207		207
Ending balance: Collectively evaluated for impairment	306,407	257,149	306,407	257,149
Lease financing receivables
Allowance for loan losses:
Beginning Balance	634	791	692	633
Charge-offs		98	13	215
Provision (release)	31	77	(14)	352
Ending Balance	665	770	665	770
Ending balance: Collectively evaluated for impairment	665	770	665	770
Loans:
Ending balance	70,661	69,305	70,661	69,305	68,325
Ending balance	70,661		70,661
Ending balance: Individually evaluated for impairment		196		196
Ending balance: Collectively evaluated for impairment	70,661	69,109	70,661	69,109
Real estate - commercial
Allowance for loan losses:
Beginning Balance	10,537	8,107	9,522	9,547
Charge-offs	201	22	609	300
Recoveries	37	43	425	124
Provision (release)	(144)	505	891	(738)
Ending Balance	10,229	8,633	10,229	8,633
Ending balance: Individually evaluated for impairment	185		185
Ending balance: Collectively evaluated for impairment	10,044	8,633	10,044	8,633
Loans:
Ending balance		739,136		739,136
Ending balance	808,310		808,310
Ending balance: Individually evaluated for impairment	5,782	3,147	5,782	3,147
Ending balance: Collectively evaluated for impairment	798,402	735,989	798,402	735,989
Ending balance: Acquired and accounted for ASC 310-30	4,126		4,126
Real estate - residential
Allowance for loan losses:
Beginning Balance	1,818	1,872	1,846	2,178
Charge-offs		5	(55)	982
Recoveries	83	90	1,099	243
Provision (release)	67	(187)	(1,032)	331
Ending Balance	1,968	1,770	1,968	1,770
Ending balance: Individually evaluated for impairment	59	6	59	6
Ending balance: Collectively evaluated for impairment	1,909	1,764	1,909	1,764
Loans:
Ending balance		303,080		303,080
Ending balance	399,581		399,581
Ending balance: Individually evaluated for impairment	8,740	14,281	8,740	14,281
Ending balance: Collectively evaluated for impairment	384,858	288,799	384,858	288,799
Ending balance: Acquired and accounted for ASC 310-30	5,983		5,983
Consumer
Allowance for loan losses:
Beginning Balance	1,390	1,513	1,446	1,331
Charge-offs	49	2	141	196
Recoveries	139	369	277	607
Provision (release)	(372)	(455)	(474)	(317)
Ending Balance	1,108	1,425	1,108	1,425
Ending balance: Individually evaluated for impairment	61		61
Ending balance: Collectively evaluated for impairment	1,047	1,425	1,047	1,425
Loans:
Ending balance		116,503		116,503
Ending balance	122,022		122,022
Ending balance: Individually evaluated for impairment	2,054	2,042	2,054	2,042
Ending balance: Collectively evaluated for impairment	119,968	114,461	119,968	114,461
All other
Allowance for loan losses:
Beginning Balance	868	546	579	451
Charge-offs	115	82	316	262
Recoveries	56	51	208	179
Provision (release)	696	299	1,034	446
Ending Balance	1,505	814	1,505	814
Ending balance: Individually evaluated for impairment	26		26
Ending balance: Collectively evaluated for impairment	1,479	814	1,479	814
Loans:
Ending balance	14,317	13,943	14,317	13,943	$ 14,063
Ending balance	14,317		14,317
Ending balance: Individually evaluated for impairment	40	8	40	8
Ending balance: Collectively evaluated for impairment	14,277	13,935	14,277	13,935
Construction Loans | Real estate - commercial
Allowance for loan losses:
Beginning Balance	1,398	857	923	389
Charge-offs		19	(16)	23
Recoveries	32	11	35	89
Provision (release)	(374)	165	82	559
Ending Balance	1,056	1,014	1,056	1,014
Ending balance: Individually evaluated for impairment	42		42
Ending balance: Collectively evaluated for impairment	1,014	1,014	1,014	1,014
Loans:
Ending balance		94,868		94,868
Ending balance	113,651		113,651
Ending balance: Individually evaluated for impairment	109	205	109	205
Ending balance: Collectively evaluated for impairment	112,764	$ 94,663	112,764	$ 94,663
Ending balance: Acquired and accounted for ASC 310-30	$ 778		$ 778

Other Real Estate Owned (Detail

Other Real Estate Owned (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Activity in the other real estate owned (OREO) portfolio, net of valuation reserve
Balance at beginning of period	$ 8,912	$ 11,724	$ 8,371	$ 11,916
Property additions, net of acquisition adjustments	(217)	176	2,595	3,796
Property improvements			59
Less: Property disposals, net of gains/losses	1,612	1,956	3,576	5,058
Less: Period valuation adjustments	119	920	485	1,630
Balance at end of period	6,964	9,024	6,964	9,024
Activity in the valuation allowance
Balance at beginning of period	8,348	8,304	8,208	9,982
Provision for unrealized losses	119	920	485	1,630
Reductions taken on sales	(456)	(421)	(682)	(2,809)
Balance at end of period	8,011	8,803	8,011	8,803
Expenses related to foreclosed assets, net of lease revenue
Gain on sales, net	(612)	(276)	(716)	(454)
Provision for unrealized losses	119	920	485	1,630
Operating expenses	133	221	502	1,037
Less: Lease revenue	10	185	39	285
Expenses related to OREO, net of lease revenue	$ (370)	$ 680	$ 232	$ 1,928

Deposits - Components and Matur

Deposits - Components and Maturities (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Jun. 30, 2018	Dec. 31, 2017
Deposits
Noninterest bearing demand	$ 621,580	$ 621,580	$ 572,404
Savings		298,073	262,220
NOW accounts		437,361	429,448
Money market accounts		310,452	276,082
Certificates of deposit of less than $100,000		235,272	216,493
Certificates of deposit of $100,000 up to $250,000		163,716	122,489
Certificates of deposit of $250,000 or more		65,916	43,789
Total deposits	$ 2,132,370	$ 2,132,370	$ 1,922,925

Borrowings - Summary (Details)

Borrowings - Summary (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Jun. 30, 2018	Dec. 31, 2017
Borrowings
Senior Notes	$ 44,133		$ 44,058
Total borrowings		$ 246,065	246,615
Securities sold under repurchase agreements
Borrowings
Total borrowings		44,333	29,918
FHLBC advances
Borrowings
Total borrowings		81,875	115,000
Junior subordinated debentures
Borrowings
Total borrowings		57,674	57,639
Senior Notes.
Borrowings
Senior Notes		44,133	$ 44,058
Notes payable and other borrowings
Borrowings
Total borrowings		$ 18,050

Borrowings - Additional informa

Borrowings - Additional information (Details) - USD ($)	3 Months Ended	9 Months Ended
	Dec. 31, 2016	Sep. 30, 2018	Jun. 30, 2018	Apr. 20, 2018	Dec. 31, 2017
Borrowings
Interest rate (as a percent)	5.75%
Bank owned FHLBC stock		$ 4,300,000			$ 5,400,000
Senior notes		44,133,000			44,058,000
Debt Instrument, Term	10 years
Interest rate term	5 years
Total borrowings			$ 246,065,000		246,615,000
GCFC/ABC Bank
Borrowings
FHLBC advance amount		$ 18,100,000
Subordinated Debt.				$ 6,600,000
Debt Instrument, Term		7 years 6 months
Debt assumed		$ 23,500,000
GCFC/ABC Bank | Minimum
Borrowings
Interest rate (as a percent)		1.40%
GCFC/ABC Bank | Maximum
Borrowings
Interest rate (as a percent)		2.83%
Three month LIBOR
Borrowings
Basis points added to reference rate (as a percent)	385.00%
Securities sold under repurchase agreements
Borrowings
Carrying amount of securities secured			44,300,000		29,900,000
Fair value of the pledged collateral			72,600,000		40,000,000
Total borrowings			44,333,000		29,918,000
Securities sold under repurchase agreements | Minimum
Borrowings
Threshold percentage of stockholders' equity		10.00%
FHLBC advances
Borrowings
Borrowings at FHLBC as percentage of total assets		35.00%
Borrowings at FHLBC as percentage of book value of certain mortgage loans		60.00%
FHLBC advance amount		$ 77,900,000			115,000,000
Bank owned FHLBC stock			4,300,000
Fair value of securities collateralized		$ 77,300,000
Principal balance of loans collateralized			304,200,000
Combined collateral value			303,300,000
Amount available for additional borrowings			133,000,000
Total borrowings			81,875,000		115,000,000
FHLB advances at 2.01 %
Borrowings
Interest rate (as a percent)		2.22%
FHLBC advance amount		$ 65,000,000
FHLB advances at 1.40 %
Borrowings
Interest rate (as a percent)		2.24%
FHLBC advance amount		$ 5,000,000
Notes payable and other borrowings
Borrowings
Total borrowings			18,050,000
Correspondent Bank
Borrowings
Interest rate (as a percent)		3.85%
Maximum borrowing capacity		$ 20,000,000
Debt Instrument, Term		360 days
Short-term debt		$ 4,000,000
Junior subordinated debentures
Borrowings
Total borrowings			57,674,000		57,639,000
Senior Notes.
Borrowings
Senior notes			44,133,000		44,058,000
Debt issuance costs			$ 867,000		$ 942,000
Amortization period for deferred financing costs		10 years

Junior Subordinated Debentures

Junior Subordinated Debentures - Issuance (Details) - USD ($) $ in Thousands	1 Months Ended				9 Months Ended
	Jun. 30, 2017	Apr. 30, 2007	Jul. 31, 2003	Jun. 30, 2003	Sep. 30, 2018	Jun. 30, 2018	Dec. 31, 2017
Junior subordinated debentures
Junior subordinated debentures					$ 57,674		$ 57,639
Old Second Capital Trust I
Junior subordinated debentures
Proceeds from sale of cumulative trust preferred securities			$ 4,100	$ 27,500
Maturity Period					30 years
Cash distribution rate of trust preferred securities (as a percent)					7.80%
Old Second Capital Trust II
Junior subordinated debentures
Proceeds from sale of cumulative trust preferred securities		$ 25,000
Maturity Period					30 years
Old Second Capital Trust II | Debt Instrument, Redemption, Period One [Member]
Junior subordinated debentures
Cash distribution rate of trust preferred securities (as a percent)	4.34%
Cash distribution fixed rate of trust preferred securities (as a percent)					6.77%
Old Second Capital Trust II | Debt Instrument, Redemption, Period Two [Member]
Junior subordinated debentures
Basis points added to cash distribution floating rate base (as a percent)					1.50%
Old Second Capital Trust II | Debt Instrument, Redemption, Period Two [Member] | Three month LIBOR
Junior subordinated debentures
Cash distribution, floating rate base					three-month LIBOR
Junior subordinated debentures
Junior subordinated debentures
Junior Subordinated Debentures issuance cost						$ 704	$ 739
Junior subordinated debentures | Old Second Capital Trust I
Junior subordinated debentures
Junior subordinated debentures					$ 32,600
Junior subordinated debentures | Old Second Capital Trust II
Junior subordinated debentures
Junior subordinated debentures					$ 25,800

Equity Compensation Plans - Opt

Equity Compensation Plans - Options (Details) - USD ($)	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Jun. 01, 2016	May 31, 2016	May 20, 2014
Equity Compensation Plans
Total compensation cost	$ 1.7	$ 925,000
2014 Plan
Equity Compensation Plans
Number of shares authorized			975,000	600,000	375,000
Stock options
Equity Compensation Plans
Granted (in shares)	0	0
Term of stock options granted	10 years
Total unrecognized compensation cost	$ 0
Shares
Beginning outstanding (in shares)	9,000
Ending outstanding (in shares)	9,000
Ending outstanding (in dollars)	$ 72,000
Exercisable at the end of the period (in dollars)	$ 72,000
Exercisable at end of period (in shares)	9,000
Weighted Average Exercise Price
Beginning outstanding (in dollars per share)	$ 7.49
Ending outstanding (in dollars per share)	7.49
Exercisable at end of period (in dollars per share)	$ 7.49
Weighted Average Remaining Contractual Term (years)
Ending outstanding (in years)	4 months 24 days
Exercisable at end of period	4 months 24 days

Equity Compensation Plans - Sum

Equity Compensation Plans - Summary of stock option activity (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Jun. 01, 2016	May 31, 2016	May 20, 2014
Equity Compensation Plans
Stock based compensation	$ 1,641	$ 897
2014 Plan
Equity Compensation Plans
Number of shares authorized			975,000	600,000	375,000
Number of shares issuable	169,791

Equity Compensation Plans - Res

Equity Compensation Plans - Restricted Stock and RSUs (Details) - Restricted stock and restricted stock units - USD ($) $ / shares in Units, $ in Millions	3 Months Ended	9 Months Ended
	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Equity Compensation Plans
Vesting period		3 years
Changes in unvested awards
Nonvested at the beginning of the period (in shares)		465,000
Granted (in shares)	161,500	254,281	161,500
Vested (in shares)		(155,500)
Nonvested at the end of the period (in shares)		563,781
Weighted Average Grant Date Fair Value
Nonvested at the beginning of the period (in dollars per share)		$ 7.79
Granted (in dollars per share)		13.98
Vested (in dollars per share)		5.14
Nonvested at the end of the period (in dollars per share)		$ 11.31
Additional information
Total unrecognized compensation cost of restricted awards		$ 3.6
Expected weighted-average period for recognition of unrecognized compensation		2 years 4 days
Officers and Directors
Changes in unvested awards
Granted (in shares)		140,000

Earnings Per Share - Reconcilia

Earnings Per Share - Reconciliation (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended			9 Months Ended		12 Months Ended	21 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2016	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2009	Sep. 30, 2018	Jan. 16, 2009
Basic earnings per share:
Weighted-average common shares outstanding	29,747,078	29,627,086		29,718,191	29,591,811
Net income	$ 9,642	$ 8,077		$ 25,392	$ 17,650
Net income available to common stockholders	$ 9,642	$ 8,077		$ 25,392	$ 17,650
Basic earnings per share (in dollars per share)	$ 0.32	$ 0.27		$ 0.85	$ 0.60
Diluted earnings per share:
Weighted-average common shares outstanding	29,747,078	29,627,086		29,718,191	29,591,811
Diluted average common shares outstanding	30,383,891	30,103,609		30,297,294	30,019,365
Net earnings available to common stockholders	$ 9,642	$ 8,077		$ 25,392	$ 17,650
Diluted earnings per share (in dollars per share)	$ 0.32	$ 0.27		$ 0.84	$ 0.59
Warrants, exercise price (in dollars per share)								$ 13.43
Warrant term			10 years
Antidilutive options and warrants
Diluted earnings per share:
One 10 year warrant		900,839			900,839
Warrants
Diluted earnings per share:
One 10 year warrant				815,339	815,339
Warrants, exercise price (in dollars per share)								$ 13.43
Warrant term				10 years	10 years	10 years	10 years
Restricted stock and restricted stock units
Diluted earnings per share:
Dilutive effect of share-based payment awards (in shares)	563,781	473,967		525,627	425,081
Stock options
Diluted earnings per share:
Dilutive effect of share-based payment awards (in shares)	73,032	2,556		53,476	2,473

Regulatory & Capital Matters (D

Regulatory & Capital Matters (Details)	9 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Regulatory & Capital Matters
Tier 1 capital leverage ratio (as a percent)	9.72%	10.08%
Risk-based capital ratio (as a percent)	12.57%	12.93%
Old Second National Bank
Regulatory & Capital Matters
Tier 1 capital leverage ratio (as a percent)	11.05%	10.79%
Risk-based capital ratio (as a percent)	14.16%	13.78%
Tier One leverage ratio, basis point increase (as a percent)	0.26%
Risk-based capital ratio, basis point decrease (as a percent)	0.38%
Minimum | Old Second National Bank
Regulatory & Capital Matters
Tier 1 capital leverage ratio, board-designated threshold	8.00%
Total Capital Ratio, board-designated threshold (as a percent)	12.00%

Regulatory & Capital Matters -

Regulatory & Capital Matters - Capital Levels and Industry Defined Regulatory Minimums (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Common equity tier 1 capital to risk weighted assets
Actual	$ 196,632	$ 179,853
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable	$ 137,448	$ 111,801
Common equity tier 1 capital to risk weighted assets, Ratio
Actual (as a percent)	9.12%	9.25%
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent)	6.375%	5.75%
Total capital to risk weighted assets, Amount
Actual at period end	$ 270,976	$ 251,383
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable	$ 212,879	$ 179,837
Total capital to risk weighted assets, Ratio
Risk-based capital ratio (as a percent)	12.57%	12.93%
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent)	9.875%	9.25%
Tier 1 capital to risk weighted assets, Amount
Actual	$ 251,653	$ 233,927
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable	$ 169,817	$ 140,978
Tier 1 capital to risk weighted assets, Ratio
Actual (as a percent)	11.67%	12.03%
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent)	7.875%	7.25%
Tier 1 capital to average assets, Amount
Actual	$ 251,653	$ 233,927
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable	$ 103,561	$ 92,828
Tier 1 capital to average assets, Ratio
Tier 1 capital leverage ratio (as a percent)	9.72%	10.08%
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent)	4.00%	4.00%
Old Second National Bank
Common equity tier 1 capital to risk weighted assets
Actual	$ 285,010	$ 249,417
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable	137,024	111,347
Minimum Required to Be Well Capitalized	$ 139,711	$ 125,870
Common equity tier 1 capital to risk weighted assets, Ratio
Actual (as a percent)	13.26%	12.88%
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent)	6.375%	5.75%
Minimum Required to Be Well Capitalized (as a percent)	6.50%	6.50%
Total capital to risk weighted assets, Amount
Actual at period end	$ 304,333	$ 266,873
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable	212,238	179,142
Minimum Required to Be Well Capitalized	$ 214,924	$ 193,667
Total capital to risk weighted assets, Ratio
Risk-based capital ratio (as a percent)	14.16%	13.78%
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent)	9.875%	9.25%
Minimum Required to Be Well Capitalized (as a percent)	10.00%	10.00%
Tier 1 capital to risk weighted assets, Amount
Actual	$ 285,010	$ 249,417
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable	169,265	140,394
Minimum Required to Be Well Capitalized	$ 171,952	$ 154,917
Tier 1 capital to risk weighted assets, Ratio
Actual (as a percent)	13.26%	12.88%
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent)	7.875%	7.25%
Minimum Required to Be Well Capitalized (as a percent)	8.00%	8.00%
Tier 1 capital to average assets, Amount
Actual	$ 285,010	$ 249,417
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable	103,171	92,462
Minimum Required to Be Well Capitalized	$ 128,964	$ 115,578
Tier 1 capital to average assets, Ratio
Tier 1 capital leverage ratio (as a percent)	11.05%	10.79%
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent)	4.00%	4.00%
Minimum Required to Be Well Capitalized (as a percent)	5.00%	5.00%

Regulatory & Capital Matters _2

Regulatory & Capital Matters - Dividend Restrictions and Deferrals (Details)	9 Months Ended
	Sep. 30, 2018
Dividend Restrictions and Deferrals
Number of previous years retained profit considered for dividend payment	2 years
Minimum capital requirements, minimum percentage required, 2016	0.625%
Minimum capital requirements, minimum percentage required, 2017	1.25%
Minimum capital requirements, minimum percentage required, 2018	1.875%
Minimum capital requirements, minimum percentage required, 2019 and thereafter	2.50%

Fair Value Measurements - Recur

Fair Value Measurements - Recurring (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Assets:
Securities available-for-sale	$ 542,338	$ 542,338	$ 541,439
Mortgage servicing rights	8,131		6,944
U.S. Treasury
Assets:
Securities available-for-sale	3,854		3,947
U.S. government agencies
Assets:
Securities available-for-sale	11,703		13,061
U.S. government agency mortgage-backed
Assets:
Securities available-for-sale	14,766
States and political subdivisions
Assets and liabilities measured at fair value on a recurring basis
Purchases	20,421	$ 10,994
Assets:
Securities available-for-sale	272,264		278,092
Corporate bonds
Assets:
Securities available-for-sale			833
Collateralized mortgage obligations
Assets:
Securities available-for-sale	64,960		65,939
Asset-backed securities
Assets:
Securities available-for-sale	109,173		112,932
Collateralized loan obligations
Assets:
Securities available-for-sale	65,618		54,421
Level 1
Assets:
Securities available-for-sale	3,854		3,947
Level 2
Assets:
Securities available-for-sale	527,409		520,963
Loans held-for-sale	2,911		4,067
Liabilities:
Other liabilities			1,287
Level 2 | Interest rate swap agreements net of swap credit valuation
Assets:
Other assets	1,135
Level 3
Assets:
Securities available-for-sale	11,075		16,529
Recurring
Assets:
Securities available-for-sale			13,061
Total financial assets	556,334		553,415
Liabilities:
Total	2,803		2,014
Recurring | Finite-Lived Intangible Assets [Member]
Assets:
Loans held-for-sale	2,911		4,067
Mortgage servicing rights	8,131		6,944
Recurring | Interest rate swap agreements net of swap credit valuation
Liabilities:
Other liabilities	2,803		2,014
Recurring | Interest rate swap agreements net of swap credit valuation | Finite-Lived Intangible Assets [Member]
Assets:
Other assets	2,803		727
Recurring | Forward MBS contracts and forward loan contracts | Finite-Lived Intangible Assets [Member]
Assets:
Other assets	151		238
Recurring | U.S. Treasury
Assets:
Securities available-for-sale			3,947
Recurring | U.S. Treasury | Finite-Lived Intangible Assets [Member]
Assets:
Securities available-for-sale	3,854
Recurring | U.S. government agencies | Finite-Lived Intangible Assets [Member]
Assets:
Securities available-for-sale	11,703
Recurring | U.S. government agency mortgage-backed | Finite-Lived Intangible Assets [Member]
Assets:
Securities available-for-sale	14,766		12,214
Recurring | States and political subdivisions | Finite-Lived Intangible Assets [Member]
Assets:
Securities available-for-sale	272,264		278,092
Recurring | Corporate bonds | Finite-Lived Intangible Assets [Member]
Assets:
Securities available-for-sale			833
Recurring | Collateralized mortgage obligations | Finite-Lived Intangible Assets [Member]
Assets:
Securities available-for-sale	64,960		65,939
Recurring | Asset-backed securities | Finite-Lived Intangible Assets [Member]
Assets:
Securities available-for-sale	109,173		112,932
Recurring | Collateralized loan obligations | Finite-Lived Intangible Assets [Member]
Assets:
Securities available-for-sale	65,618		54,421
Recurring | Level 1
Assets:
Total financial assets	3,854		3,947
Recurring | Level 1 | U.S. Treasury
Assets:
Securities available-for-sale			3,947
Recurring | Level 1 | U.S. Treasury | Finite-Lived Intangible Assets [Member]
Assets:
Securities available-for-sale	3,854
Recurring | Level 2
Assets:
Securities available-for-sale			13,061
Total financial assets	533,274		525,995
Liabilities:
Total	2,803		2,014
Recurring | Level 2 | Finite-Lived Intangible Assets [Member]
Assets:
Loans held-for-sale	2,911		4,067
Recurring | Level 2 | Interest rate swap agreements net of swap credit valuation
Liabilities:
Other liabilities	2,803		2,014
Recurring | Level 2 | Interest rate swap agreements net of swap credit valuation | Finite-Lived Intangible Assets [Member]
Assets:
Other assets	2,803		727
Recurring | Level 2 | Forward MBS contracts and forward loan contracts | Finite-Lived Intangible Assets [Member]
Assets:
Other assets	151		238
Recurring | Level 2 | U.S. government agencies | Finite-Lived Intangible Assets [Member]
Assets:
Securities available-for-sale	11,703
Recurring | Level 2 | U.S. government agency mortgage-backed | Finite-Lived Intangible Assets [Member]
Assets:
Securities available-for-sale	14,766		12,214
Recurring | Level 2 | States and political subdivisions | Finite-Lived Intangible Assets [Member]
Assets:
Securities available-for-sale	262,753		263,831
Recurring | Level 2 | Corporate bonds | Finite-Lived Intangible Assets [Member]
Assets:
Securities available-for-sale			833
Recurring | Level 2 | Collateralized mortgage obligations | Finite-Lived Intangible Assets [Member]
Assets:
Securities available-for-sale	63,396		63,671
Recurring | Level 2 | Asset-backed securities | Finite-Lived Intangible Assets [Member]
Assets:
Securities available-for-sale	109,173		112,932
Recurring | Level 2 | Collateralized loan obligations | Finite-Lived Intangible Assets [Member]
Assets:
Securities available-for-sale	65,618		54,421
Recurring | Level 3
Assets:
Total financial assets	19,206		23,473
Recurring | Level 3 | Finite-Lived Intangible Assets [Member]
Assets:
Mortgage servicing rights	8,131		6,944
Recurring | Level 3 | States and political subdivisions | Finite-Lived Intangible Assets [Member]
Assets:
Securities available-for-sale	9,511		14,261
Recurring | Level 3 | Collateralized mortgage obligations | Finite-Lived Intangible Assets [Member]
Assets:
Securities available-for-sale	$ 1,564		$ 2,268

Fair Value Measurements - Chang

Fair Value Measurements - Changes in Level 3 (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Changes in Level 3
Beginning balance		$ 3,119
Total gains or losses
Included in other comprehensive income		7
Purchases, issuances, sales, and settlements
Settlements		(666)
Ending balance		2,492
Changes in Level 3 (liabilities)
Included in earnings (or changes in net assets)		32
Collateralized loan obligations
Changes in Level 3
Beginning balance	$ 2,268
Total gains or losses
Included in other comprehensive income	34
Purchases, issuances, sales, and settlements
Settlements	(770)
Ending balance	1,564
Changes in Level 3 (liabilities)
Included in earnings (or changes in net assets)	32
States and political subdivisions
Changes in Level 3
Beginning balance	14,261	22,226
Total gains or losses
Included in other comprehensive income	(805)	(501)
Purchases, issuances, sales, and settlements
Purchases	20,421	10,994
Settlements	(24,366)	(20,359)
Ending balance	9,511	12,360
Mortgage servicing rights
Changes in Level 3
Beginning balance	6,944	6,489
Total gains or losses
Included in earnings (or changes in net assets)		(354)
Purchases, issuances, sales, and settlements
Issuances	997	951
Settlements	(446)	(402)
Ending balance	8,131	$ 6,684
Changes in Level 3 (liabilities)
Included in earnings (or changes in net assets)	$ 636

Fair Value Measurements - Quant

Fair Value Measurements - Quantitative and Qualitative Information (Details) $ in Thousands	Sep. 30, 2018USD ($)	Dec. 31, 2017USD ($)
Quantitative information about Level 3 fair value measurements
Mortgage servicing rights, fair value	$ 8,131	$ 6,944
Measurement Input, Discount Rate
Quantitative information about Level 3 fair value measurements
Mortgage servicing rights, fair value		$ 6,944
Measurement Input, Discount Rate | Minimum
Quantitative information about Level 3 fair value measurements
Servicing Asset, Measurement Input		10
Measurement Input, Discount Rate | Maximum
Quantitative information about Level 3 fair value measurements
Servicing Asset, Measurement Input		34.3
Measurement Input, Discount Rate | Weighted Average
Quantitative information about Level 3 fair value measurements
Servicing Asset, Measurement Input		10.2
Recurring | Measurement Input, Discount Rate | Mortgage servicing rights | Discounted Cash Flow | Level 3
Quantitative information about Level 3 fair value measurements
Mortgage servicing rights, fair value	$ 8,131
Recurring | Measurement Input, Discount Rate | Mortgage servicing rights | Discounted Cash Flow | Level 3 | Minimum
Quantitative information about Level 3 fair value measurements
Servicing Asset, Measurement Input	7
Recurring | Measurement Input, Discount Rate | Mortgage servicing rights | Discounted Cash Flow | Level 3 | Maximum
Quantitative information about Level 3 fair value measurements
Servicing Asset, Measurement Input	302.1
Recurring | Measurement Input, Discount Rate | Mortgage servicing rights | Discounted Cash Flow | Level 3 | Weighted Average
Quantitative information about Level 3 fair value measurements
Servicing Asset, Measurement Input	10.2
Recurring | Measurement Input, Constant Prepayment Rate | Mortgage servicing rights | Discounted Cash Flow | Level 3 | Minimum
Quantitative information about Level 3 fair value measurements
Servicing Asset, Measurement Input	7	7
Recurring | Measurement Input, Constant Prepayment Rate | Mortgage servicing rights | Discounted Cash Flow | Level 3 | Maximum
Quantitative information about Level 3 fair value measurements
Servicing Asset, Measurement Input	68.9	68.4
Recurring | Measurement Input, Constant Prepayment Rate | Mortgage servicing rights | Discounted Cash Flow | Level 3 | Weighted Average
Quantitative information about Level 3 fair value measurements
Servicing Asset, Measurement Input	8.2	9.6

Fair Value Measurements - Nonre

Fair Value Measurements - Nonrecurring (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2018	Dec. 31, 2017	Jun. 30, 2018	Sep. 30, 2017	Jun. 30, 2017	Dec. 31, 2016
Assets and liabilities measured at fair value
Valuation allowance	$ 373	$ 144
Carrying value of other real estate owned	6,964	8,371	$ 8,912	$ 9,024	$ 11,724	$ 11,916
OREO Valuation allowance	8,011	8,208	$ 8,348	$ 8,803	$ 8,304	$ 9,982
Impaired loans
Assets and liabilities measured at fair value
Valuation allowance		5,300
Nonrecurring
Assets and liabilities measured at fair value
Total	16,233	13,484
Nonrecurring | Impaired loans
Assets and liabilities measured at fair value
Total	9,269	5,113
Valuation allowance	373	144,000,000
Increase (decrease) of specific allocations within the provision for loan losses	229	856,000,000
Nonrecurring | Impaired loans | Carrying Amount
Assets and liabilities measured at fair value
Total	9,600
Nonrecurring | Other real estate owned
Assets and liabilities measured at fair value
Total	6,964	8,371
Carrying value of other real estate owned	7,000	8,400
Outstanding balance	15,900	17,500
OREO Valuation allowance	8,000	8,200
OREO participations	937,000,000	937,000
Nonrecurring | Level 3
Assets and liabilities measured at fair value
Total	16,233	13,484
Nonrecurring | Level 3 | Impaired loans
Assets and liabilities measured at fair value
Total	9,269	5,113
Nonrecurring | Level 3 | Other real estate owned
Assets and liabilities measured at fair value
Total	$ 6,964	$ 8,371

Fair Values of Financial Inst_3

Fair Values of Financial Instruments (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Jun. 30, 2018	Dec. 31, 2017	Sep. 30, 2017
Financial assets:
Cash and due from banks	$ 34,366		$ 37,444
Interest bearing deposits with financial institutions	15,956		18,389
Securities available-for-sale	542,338		541,439	$ 542,338
FHLBC and FRBC Stock	10,511		10,168
Bank-owned life insurance	61,506		61,764
Financial liabilities:
Noninterest bearing deposits	621,580	$ 621,580	572,404
Other short-term borrowings	81,875		115,000
Junior subordinated debentures	57,674		57,639
Carrying Amount
Financial assets:
Cash and due from banks	34,366		37,444
Interest bearing deposits with financial institutions	15,956		18,389
Securities available-for-sale	542,338		541,439
FHLBC and FRBC Stock	10,511		10,168
Loans held for sale	2,911		4,067
Loans, net	1,815,621		1,600,161
Accrued interest receivable	10,460		8,595
Financial liabilities:
Noninterest bearing deposits	621,580		572,404
Interest bearing deposits	1,510,790		1,350,521
Securities sold under repurchase agreements	44,333		29,918
Other short-term borrowings	81,875		115,000
Junior subordinated debentures	57,674		57,639
Subordinated debenture	44,133		44,058
Note payable and other borrowings	18,050
Interest rate swap			1,287
Borrowing interest payable	801		140
Deposit interest payable	924		631
Total Fair Value
Financial assets:
Cash and due from banks	34,366		37,444
Interest bearing deposits with financial institutions	15,956		18,389
Securities available-for-sale	542,338		541,439
FHLBC and FRBC Stock	10,511		10,168
Loans held for sale	2,911		4,067
Loans, net	1,801,489		1,586,722
Accrued interest receivable	10,460		8,595
Financial liabilities:
Noninterest bearing deposits	621,580		572,404
Interest bearing deposits	1,583,984		1,346,339
Securities sold under repurchase agreements	44,333		29,918
Other short-term borrowings	81,875		115,000
Junior subordinated debentures	59,104		59,471
Subordinated debenture	45,693		46,743
Note payable and other borrowings	18,050
Interest rate swap			1,287
Borrowing interest payable	801		140
Deposit interest payable	924		631
Level 1
Financial assets:
Cash and due from banks	34,366		37,444
Interest bearing deposits with financial institutions	15,956		18,389
Securities available-for-sale	3,854		3,947
Financial liabilities:
Noninterest bearing deposits	621,580		572,404
Junior subordinated debentures	33,336		33,267
Level 2
Financial assets:
Securities available-for-sale	527,409		520,963
FHLBC and FRBC Stock	10,511		10,168
Loans held for sale	2,911		4,067
Accrued interest receivable	10,460		8,595
Financial liabilities:
Interest bearing deposits	1,583,984		1,346,339
Securities sold under repurchase agreements	44,333		29,918
Other short-term borrowings	81,875		115,000
Junior subordinated debentures	25,769		26,204
Subordinated debenture	45,693		46,743
Note payable and other borrowings	18,050
Interest rate swap			1,287
Borrowing interest payable	801		140
Deposit interest payable	924		631
Level 3
Financial assets:
Securities available-for-sale	11,075		16,529
Loans, net	1,801,489		$ 1,586,722
Interest rate swap agreements net of swap credit valuation | Carrying Amount
Financial assets:
Interest rate swap agreements	1,135
Interest rate swap agreements net of swap credit valuation | Total Fair Value
Financial assets:
Interest rate swap agreements	1,135
Interest rate swap agreements net of swap credit valuation | Level 2
Financial assets:
Interest rate swap agreements	$ 1,135

Derivatives, Hedging Activities

Derivatives, Hedging Activities and Financial Instruments with Off-Balance Sheet Risk - Fair Value of Derivatives (Details)	Sep. 30, 2018USD ($)item	Dec. 31, 2017USD ($)
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions
Amount to be reclassified as a reduction to interest expense during the next twelve months	$ 18,000
Derivative assets designated as hedging instruments, fair value	1,135,000
Derivative liabilities designated as hedging instruments, fair value		$ 1,287,000
Derivative assets not designated as hedging instruments, fair value	2,954,000	965,000
Total Derivative liabilities not designated as hedging instruments, fair value	2,806,000	740,000
Interest Rate Products
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions
Derivative assets designated as hedging instruments, classified in other assets	$ 1,135,000
Derivated liabilities designated as hedging instruments, classified in other liabilities		1,287,000
Interest Rate Products | Designated
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions
Derivative, number of transactions | item	1
Notional Amount	$ 25,774,000
Interest Rate Products | Commercial Loan Customers
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions
Interest rate derivatives, derivative assets not designated as hedging instruments, classified in other assets	2,803,000	727,000
Interest rate derivatives, derivative not designated as hedging instruments, classified in other liabilities		727,000
Other derivatives, derivative not designated as hedging instruments, classified in other liabilities	2,803,000
Interest Rate Products | Commercial Loan Customers | Not designated
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions
Notional Amount	168,394,000
Other Contracts
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions
Other derivatives, derivative not designated as hedging instruments, classified in other liabilities	$ 3,000	13,000
Other Contracts | Not designated
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions
Derivative, number of transactions | item	3
Notional Amount	$ 15,806,000
Interest Rate Lock Commitments and Forward Contracts
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions
Interest rate derivatives, derivative assets not designated as hedging instruments, classified in other assets	151,000	$ 238,000
Interest Rate Lock Commitments and Forward Contracts | Not designated
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions
Notional Amount	$ 25,250,000

Derivatives, Hedging Activiti_2

Derivatives, Hedging Activities and Financial Instruments with Off-Balance Sheet Risk - Effect of Fair Value (Details) - USD ($)	Jun. 30, 2018	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Derivatives, Hedging Activities and Financial Instruments with Off-Balance Sheet Risk
Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income	$ 599,000			$ 80,000
Amount of Gain or (Loss) Recognized in Income on Derivative		$ (29,000)	$ (101,000)	$ (145,000)	$ (119,000)

Derivatives, Hedging Activiti_3

Derivatives, Hedging Activities and Financial Instruments with Off-Balance Sheet Risk - Commitments (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Company's contractual commitments due to letters of credit
Total letters of credit	$ 15,553	$ 12,278
Fixed
Company's contractual commitments due to letters of credit
Total letters of credit	859	418
Variable
Company's contractual commitments due to letters of credit
Total letters of credit	14,694	11,860
Borrower
Company's contractual commitments due to letters of credit
Total letters of credit	15,486	12,136
Borrower | Fixed
Company's contractual commitments due to letters of credit
Total letters of credit	859	418
Borrower | Variable
Company's contractual commitments due to letters of credit
Total letters of credit	14,627	11,718
Borrower | Financial standby
Company's contractual commitments due to letters of credit
Total letters of credit	7,492	3,947
Borrower | Financial standby | Fixed
Company's contractual commitments due to letters of credit
Total letters of credit	327	177
Borrower | Financial standby | Variable
Company's contractual commitments due to letters of credit
Total letters of credit	7,165	3,770
Borrower | Commercial standby
Company's contractual commitments due to letters of credit
Total letters of credit	388	354
Borrower | Commercial standby | Variable
Company's contractual commitments due to letters of credit
Total letters of credit	388	354
Borrower | Performance standby
Company's contractual commitments due to letters of credit
Total letters of credit	7,606	7,835
Borrower | Performance standby | Fixed
Company's contractual commitments due to letters of credit
Total letters of credit	532	241
Borrower | Performance standby | Variable
Company's contractual commitments due to letters of credit
Total letters of credit	7,074	7,594
Nonborrower | Performance standby
Company's contractual commitments due to letters of credit
Total letters of credit	67	142
Nonborrower | Performance standby | Variable
Company's contractual commitments due to letters of credit
Total letters of credit	$ 67	$ 142