Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2019 | Nov. 04, 2019 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2019 | |
Entity Registrant Name | OLD SECOND BANCORP INC | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 29,903,154 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Entity Central Index Key | 0000357173 | |
Amendment Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Assets | ||
Cash and due from banks | $ 42,671 | $ 38,599 |
Interest bearing deposits with financial institutions | 11,366 | 16,636 |
Cash and cash equivalents | 54,037 | 55,235 |
Securities available-for-sale, at fair value | 488,422 | 541,248 |
Federal Home Loan Bank Chicago ("FHLBC") and Federal Reserve Bank Chicago ("FRBC") stock | 10,711 | 13,433 |
Loans held-for-sale | 5,592 | 2,984 |
Loans | 1,899,811 | 1,897,027 |
Less: allowance for loan losses | 19,651 | 19,006 |
Net loans | 1,880,160 | 1,878,021 |
Premises and equipment, net | 42,900 | 42,439 |
Other real estate owned | 4,682 | 7,175 |
Mortgage servicing rights, net | 5,361 | 7,357 |
Goodwill and core deposit intangible | 21,404 | 21,814 |
Bank-owned life insurance (BOLI) | 62,589 | 61,544 |
Deferred tax assets, net | 12,691 | 21,280 |
Other assets | 25,766 | 23,473 |
Total assets | 2,614,315 | 2,676,003 |
Deposits: | ||
Noninterest bearing demand | 643,355 | 618,830 |
Interest bearing: | ||
Savings, NOW, and money market | 1,004,501 | 1,040,668 |
Time | 426,635 | 457,175 |
Total deposits | 2,074,491 | 2,116,673 |
Securities sold under repurchase agreements | 48,870 | 46,632 |
Other short-term borrowings | 84,000 | 149,500 |
Junior subordinated debentures | 57,722 | 57,686 |
Senior notes | 44,244 | 44,158 |
Notes payable and other borrowings | 8,856 | 15,379 |
Other liabilities | 26,111 | 16,894 |
Total liabilities | 2,344,294 | 2,446,922 |
Stockholders' Equity | ||
Common stock | 34,825 | 34,720 |
Additional paid-in capital | 120,291 | 119,081 |
Retained earnings | 204,486 | 175,463 |
Accumulated other comprehensive (loss) income | 6,371 | (4,079) |
Treasury stock | (95,952) | (96,104) |
Total stockholders' equity | 270,021 | 229,081 |
Total liabilities and stockholders' equity | $ 2,614,315 | $ 2,676,003 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2019 | Dec. 31, 2018 |
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 | 34,825,340 | 34,719,517 |
Common stock, Shares outstanding | 29,903,154 | 29,763,078 |
Treasury stock, Shares | 4,922,186 | 4,956,439 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Interest and Dividend Income | ||||
Loans, including fees | $ 25,109 | $ 23,377 | $ 74,132 | $ 64,625 |
Loans held-for-sale | 47 | 39 | 100 | 94 |
Securities: | ||||
Taxable | 2,296 | 2,491 | 6,933 | 7,053 |
Tax exempt | 1,719 | 2,064 | 5,958 | 6,239 |
Dividends from FHLBC and FRBC stock | 154 | 121 | 459 | 338 |
Interest bearing deposits with financial institutions | 119 | 84 | 344 | 230 |
Total interest and dividend income | 29,444 | 28,176 | 87,926 | 78,579 |
Interest Expense | ||||
Savings, NOW, and money market deposits | 724 | 642 | 2,254 | 1,487 |
Time deposits | 1,672 | 1,568 | 4,931 | 4,187 |
Securities sold under repurchase agreements | 135 | 140 | 431 | 323 |
Other short-term borrowings | 429 | 311 | 1,611 | 916 |
Junior subordinated debentures | 933 | 930 | 2,791 | 2,784 |
Senior notes | 682 | 672 | 2,026 | 2,016 |
Notes payable and other borrowings | 89 | 173 | 312 | 268 |
Total interest expense | 4,664 | 4,436 | 14,356 | 11,981 |
Net interest and dividend income | 24,780 | 23,740 | 73,570 | 66,598 |
Provision for loan and lease losses | 550 | 1,450 | 728 | |
Net interest and dividend income after provision for loan and lease losses | 24,230 | 23,740 | 72,120 | 65,870 |
Noninterest Income | ||||
Mortgage servicing rights mark to market loss | (946) | (11) | (2,902) | 189 |
Net gain on sales of mortgage loans | 2,074 | 965 | 3,999 | 3,122 |
Securities gains (losses), net | 3,463 | 13 | 4,476 | 360 |
Increase in cash surrender value of BOLI | 267 | 347 | 1,045 | 946 |
Death benefit realized on bank-owned life insurance | 1,026 | |||
Debit card interchange income | 1,124 | 1,135 | 3,277 | 3,279 |
Other income | 1,459 | 1,128 | 3,838 | 3,755 |
Total noninterest income | 11,933 | 7,814 | 26,558 | 24,851 |
Noninterest Expense | ||||
Salaries and employee benefits | 12,062 | 11,165 | 35,261 | 33,727 |
Occupancy, furniture and equipment | 2,235 | 1,782 | 6,149 | 4,992 |
Computer and data processing | 1,490 | 1,247 | 4,346 | 5,332 |
FDIC Insurance | (114) | 162 | 176 | 483 |
General bank insurance | 270 | 230 | 756 | 780 |
Amortization of core deposit intangible | 157 | 136 | 410 | 254 |
Advertising expense | 360 | 492 | 975 | 1,325 |
Debit card interchange expense | 279 | 320 | 659 | 902 |
Legal fees | 111 | 243 | 480 | 688 |
Other real estate expense, net | 26 | (370) | 324 | 232 |
Other expense | 3,078 | 3,304 | 9,738 | 9,636 |
Total noninterest expense | 19,954 | 18,711 | 59,274 | 58,351 |
Income before income taxes | 16,209 | 12,843 | 39,404 | 32,370 |
Provision for income taxes | 4,036 | 3,201 | 9,485 | 6,978 |
Net income available to common stockholders | $ 12,173 | $ 9,642 | $ 29,919 | $ 25,392 |
Basic earnings per share (in dollars per share) | $ 0.41 | $ 0.32 | $ 1 | $ 0.85 |
Diluted earnings per share (in dollars per share) | 0.40 | 0.32 | 0.98 | 0.84 |
Dividends declared per share (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.03 | $ 0.03 |
Deposit Account | ||||
Noninterest Income | ||||
Service charges on deposits | $ 2,020 | $ 1,923 | $ 5,841 | $ 5,284 |
Trust Income | ||||
Noninterest Income | ||||
Service charges on deposits | 1,730 | 1,644 | 4,955 | 4,784 |
Bank Servicing | ||||
Noninterest Income | ||||
Service charges on deposits | 460 | 471 | 1,408 | 1,550 |
Secondary mortgage fees | ||||
Noninterest Income | ||||
Service charges on deposits | $ 282 | $ 199 | $ 621 | $ 556 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Consolidated Statements of Comprehensive Income | ||||
Net income | $ 12,173 | $ 9,642 | $ 29,919 | $ 25,392 |
Unrealized holding (losses) gains on available-for-sale securities arising during the period | 5,824 | (2,801) | 23,661 | (12,999) |
Related tax benefit (expense) | (1,638) | 788 | (6,657) | 3,664 |
Holding (losses) gains after tax on available-for-sale securities | 4,186 | (2,013) | 17,004 | (9,335) |
Less: Reclassification adjustment for the net gains (losses) realized during the period | ||||
Net realized gains (losses) | 3,463 | 13 | 4,476 | 360 |
Related tax (expense) benefit | (973) | (3) | (1,257) | (100) |
Net realized gains (losses) after tax | 2,490 | 10 | 3,219 | 260 |
Other comprehensive (loss) income on available-for-sale securities | 1,696 | (2,023) | 13,785 | (9,595) |
Changes in fair value of derivatives used for cashflow hedges | (1,996) | 628 | (4,638) | 2,422 |
Related tax (expense) benefit | 559 | (176) | 1,303 | (683) |
Other comprehensive income on cashflow hedges | (1,437) | 452 | (3,335) | 1,739 |
Total other comprehensive (loss) income | 259 | (1,571) | 10,450 | (7,856) |
Total comprehensive income | $ 12,432 | $ 8,071 | $ 40,369 | $ 17,536 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Cash flows from operating activities | ||
Net income | $ 29,919 | $ 25,392 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Net premium amortization/discount (accretion) on securities | 2,128 | 2,128 |
Securities (gains) losses, net | (4,476) | (360) |
Provision for (release of) loan and lease losses | 1,450 | 728 |
Originations of loans held-for-sale | (126,929) | (107,947) |
Proceeds from sales of loans held-for-sale | 127,455 | 111,169 |
Net gain on sales of mortgage loans | (3,999) | (3,122) |
Change in fair value of mortgage servicing rights | 2,902 | (189) |
Net discount / premium from (accretion) amortization on loans | (1,052) | (776) |
Increase in cash surrender value of BOLI | (1,045) | (946) |
Net gains on sale of other real estate owned | (254) | (716) |
Provision for other real estate owned valuation losses | 399 | 485 |
Depreciation of fixed assets and amortization of leasehold improvements | 1,869 | 1,778 |
Net (gains) / losses on disposal and transfer of fixed assets | (32) | |
Amortization of core deposit intangible | 410 | 254 |
Change in current income taxes receivable | 3,319 | 671 |
Provision for deferred tax expense | 4,493 | 6,777 |
Change in accrued interest receivable and other assets | (7,441) | 533 |
Accretion of purchase accounting adjustment on time deposits | (38) | |
Amortization of purchase accounting adjustment on notes payable and other borrowings | 75 | |
Amortization of junior subordinated debentures issuance costs | 36 | 35 |
Amortization of senior notes issuance costs | 86 | 75 |
Change in accrued interest payable and other liabilities | 6,366 | 2,432 |
Stock based compensation | 1,905 | 1,641 |
Net cash provided by operating activities | 37,546 | 40,042 |
Cash flows from investing activities | ||
Proceeds from maturities and calls including pay down of securities available-for-sale | 32,631 | 32,890 |
Proceeds from sales of securities available-for-sale | 177,824 | 94,663 |
Purchases of securities available-for-sale | (136,096) | (71,488) |
Net proceeds from sales of FHLBC stock | 2,722 | 2,627 |
Net disbursements/proceeds from (purchases) sales of FRB stock | (1,421) | |
Net change in loans | (2,833) | 9,988 |
Proceeds from claims on BOLI | 1,204 | |
Improvements in other real estate owned | (59) | |
Proceeds from sales of other real estate owned, net of participation purchase | 2,644 | 4,292 |
Proceeds from disposition of premises and equipment | 32 | |
Net purchases of premises and equipment | (2,330) | (1,563) |
Cash paid for acquisition, net of cash and cash equivalent retained | (35,711) | |
Net cash provided by investing activities | 74,594 | 35,422 |
Cash flows from financing activities | ||
Net change in deposits | (42,144) | (39,053) |
Net change in securities sold under repurchase agreements | 2,238 | 8,792 |
Net change in other short-term borrowings | (65,500) | (44,000) |
Net change in notes payable and other borrowings | (6,598) | (5,317) |
Proceeds from exercise of stock options | 32 | |
Dividends paid common stock | (896) | (892) |
Purchase of treasury stock | (470) | (505) |
Net cash used in financing activities | (113,338) | (80,975) |
Net change in cash and cash equivalents | (1,198) | (5,511) |
Cash and cash equivalents at beginning of period | 55,235 | 55,833 |
Cash and cash equivalents at end of period | $ 54,037 | $ 50,322 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Treasury Stock | Total |
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 | |||
Reclassification of stranded tax effects | (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 |
Balance at Jun. 30, 2018 | 34,717 | 118,082 | 157,796 | (4,487) | (96,294) | 209,814 |
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 9,642 | 9,642 | ||||
Other comprehensive income, net of tax | (1,571) | (1,571) | ||||
Dividends declared and paid | (298) | (298) | ||||
Stock based compensation | 543 | 543 | ||||
Balance at Sep. 30, 2018 | 34,717 | 118,625 | 167,140 | (6,058) | (96,294) | 218,130 |
Balance at Dec. 31, 2018 | 34,720 | 119,081 | 175,463 | (4,079) | (96,104) | 229,081 |
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 29,919 | 29,919 | ||||
Other comprehensive income, net of tax | 10,450 | 10,450 | ||||
Dividends declared and paid | (896) | (896) | ||||
Vesting of restricted stock | 103 | (389) | 286 | |||
Stock options exercised | 2 | 7 | 23 | 32 | ||
Stock warrants exercised | (313) | 313 | ||||
Stock based compensation | 1,905 | 1,905 | ||||
Purchase of treasury stock | (470) | (470) | ||||
Balance at Sep. 30, 2019 | 34,825 | 120,291 | 204,486 | 6,371 | (95,952) | 270,021 |
Balance at Jun. 30, 2019 | 34,825 | 119,762 | 192,612 | 6,112 | (96,047) | 257,264 |
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 12,173 | 12,173 | ||||
Other comprehensive income, net of tax | 259 | 259 | ||||
Dividends declared and paid | (299) | (299) | ||||
Vesting of restricted stock | (135) | 135 | ||||
Stock based compensation | 664 | 664 | ||||
Purchase of treasury stock | (40) | (40) | ||||
Balance at Sep. 30, 2019 | $ 34,825 | $ 120,291 | $ 204,486 | $ 6,371 | $ (95,952) | $ 270,021 |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Stockholders' Equity (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Balance | $ 257,264 | $ 209,814 | $ 229,081 | $ 200,350 |
Other comprehensive income, net of tax | 259 | (1,571) | 10,450 | (7,856) |
Balance | 270,021 | 218,130 | 270,021 | 218,130 |
Accumulated Other Comprehensive Income (Loss) [Member] | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Balance | 6,112 | (4,487) | (4,079) | 1,479 |
Reclassification of stranded tax effects | 319 | |||
Other comprehensive income, net of tax | 259 | (1,571) | 10,450 | (7,856) |
Balance | 6,371 | (6,058) | 6,371 | (6,058) |
Accumulated Unrealized Loss on Securities Available-for-Sale | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Balance | 8,051 | (4,851) | (4,038) | 2,239 |
Reclassification of stranded tax effects | 482 | |||
Other comprehensive income, net of tax | 1,696 | (2,023) | 13,785 | (9,595) |
Balance | 9,747 | (6,874) | 9,747 | (6,874) |
Accumulated Unrealized Loss on Derivative Instruments | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Balance | (1,939) | 364 | (41) | (760) |
Reclassification of stranded tax effects | (163) | |||
Other comprehensive income, net of tax | (1,437) | 452 | (3,335) | 1,739 |
Balance | $ (3,376) | $ 816 | $ (3,376) | $ 816 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2019 | |
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, 2019, are not necessarily indicative of the results that may be expected for the year ending December 31, 2019. 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, 2018. 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, 2018. 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. Recent Accounting Pronouncements 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 adopted this standard as of January 1, 2019, and recorded right of use assets of $817,000 with a like lease liability. As of September 30, 2019, the right of use assets and lessee lease liability both totaled $3.3 million. The Company also recorded leases receivable related to lessor leases of $174,000 as of January 1, 2019 with a like entry to lease liabilities for the lessor position; these tenant leases receivable balances and lessor lease liabilities both totaled approximately $97,000 as of September 30, 2019. There was no impact to equity for the adoption of this standard on a modified retrospective basis. In June 2016, the FASB issued ASU No. 2016-13 “ Measurement of Credit Losses on Financial Instruments (Topic 326). ” This ASU 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 combination of loss rate models utilizing weighted average remaining life, migration and vintage analysis will be used for calculation of future expected losses based on data availability and the characteristics of each loan pool being assessed upon the ASU’s adoption in 2020. The Company has accumulated historical data by loan pools and collateral classifications, and is reviewing and refining the parallel calculation performed as of September 30, 2019, to confirm the model processes and determine financial statement impact prior to adoption in 2020. The Company is also developing internal control processes and disclosure documentation related to adoption of this standard. Subsequent Events On October 15, 2019, the Company’s Board of Directors declared a cash dividend of $0.01 per share payable on November 4, 2019, to stockholders of record as of October 25, 2019; dividends of $299,000 were paid to stockholders on November 4, 2019. |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 30, 2019 | |
Acquisitions | |
Acquisitions | Note 2 – Acquisitions On April 20, 2018, the Company acquired Greater Chicago Financial Corp. (“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 were 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 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 $10.2 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 $10.2 million recorded as goodwill is expected to be deductible for tax purposes. Acquisition related costs incurred by the Company for the year ended December 31, 2018, totaled $3.5 million, pre-tax, and included $1.1 million of salaries and employee benefits related expenses, and $1.8 million of data processing, computer and ATM related conversion costs. No acquisition related costs were incurred in the nine months ended September 30, 2019. 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 were considered final as of March 31, 2019, and no further refinements to the values listed below are anticipated. 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 13,280 Deferred tax assets, net 3,459 Other assets 1,767 Total assets $ 336,949 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 5,623 Other short-term borrowings 10,875 Notes payable and other borrowings 23,367 Other liabilities 1,406 Total liabilities 289,769 Cash consideration paid 47,180 Total Liabilities Assumed and Cash Consideration Paid for Acquisition $ 336,949 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 purchased credit impaired (“PCI loans”), defined as impaired loans as those that were either not accruing interest or exhibited credit risk factors consistent with nonperforming loans at the acquisition date, or purchased non-credit impaired loans (“non-PCI loans”), defined as loans acquired that did not show signs of deteriorated credit quality at acquisition. The following table represents the acquired loans as of date of acquisition and as of September 30, 2019: April 20, 2018 September 30, 2019 ABC Bank Acquired Loans PCI Non-PCI PCI Non-PCI Fair Value $ 11,360 $ 216,234 $ 9,403 $ 134,536 Contractually required principal and interest payments 19,447 220,308 15,083 135,822 Best estimate of contractual cash flows not expected to be collected 6,537 2,511 4,893 614 Best estimate of contractual cash flows expected to be collected 12,910 217,797 10,190 135,208 |
Securities
Securities | 9 Months Ended |
Sep. 30, 2019 | |
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 $4.5 million at September 30, 2019, and $7.2 million at December 31, 2018. FRBC stock was recorded at $6.2 million at September 30, 2019, and December 31, 2018. The following tables summarize the amortized cost and fair value of the securities portfolio at September 30, 2019, and December 31, 2018, and the corresponding amounts of gross unrealized gains and losses: Gross Gross Amortized Unrealized Unrealized Fair September 30, 2019 Cost Gains Losses Value Securities available-for-sale U.S. Treasuries $ 4,009 $ 29 $ - $ 4,038 U.S. government agencies 9,304 - (161) 9,143 U.S. government agencies mortgage-backed 16,338 619 (17) 16,940 States and political subdivisions 227,680 11,962 (915) 238,727 Collateralized mortgage obligations 62,965 1,216 (60) 64,121 Asset-backed securities 82,106 1,243 (167) 83,182 Collateralized loan obligations 72,454 46 (229) 72,271 Total securities available-for-sale $ 474,856 $ 15,115 $ (1,549) $ 488,422 Gross Gross Amortized Unrealized Unrealized Fair December 31, 2018 Cost Gains Losses Value Securities available-for-sale U.S. Treasury $ 4,006 $ - $ (83) $ 3,923 U.S. government agencies 11,112 - (161) 10,951 U.S. government agencies mortgage-backed 14,407 45 (377) 14,075 States and political subdivisions 277,112 1,916 (4,961) 274,067 Collateralized mortgage obligations 66,494 79 (2,144) 64,429 Asset-backed securities 108,574 1,165 (225) 109,514 Collateralized loan obligations 65,162 24 (897) 64,289 Total securities available-for-sale $ 546,867 $ 3,229 $ (8,848) $ 541,248 The fair value, amortized cost and weighted average yield of debt securities at September 30, 2019, 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 $ 736 1.92 % $ 736 Due after one year through five years 4,655 1.88 4,687 Due after five years through ten years 4,645 3.29 4,944 Due after ten years 230,957 3.04 241,541 240,993 3.02 251,908 Mortgage-backed and collateralized mortgage obligations 79,303 3.15 81,061 Asset-backed securities 82,106 3.27 83,182 Collateralized loan obligations 72,454 4.53 72,271 Total securities available-for-sale $ 474,856 3.31 % $ 488,422 At September 30, 2019, the Company’s investments included $55.7 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 $4.7 million, or 8.30% of outstanding principal. The Company has invested in securities issued from two originators that individually amount to over 10% of the Company’s stockholders equity. Information regarding these two issuers and the value of the securities issued follows: September 30, 2019 Amortized Fair Issuer Cost Value GCO Education Loan Funding Corp $ 27,840 $ 27,744 Towd Point Mortgage Trust 33,744 34,378 Securities with unrealized losses at September 30, 2019, and December 31, 2018, 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, 2019 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 - $ - $ - - $ - $ - - $ - $ - U.S. government agencies - - - 4 161 9,143 4 161 9,143 U.S. government agencies mortgage-backed 3 7 3,044 2 10 848 5 17 3,892 States and political subdivisions 3 326 15,526 2 589 6,757 5 915 22,283 Collateralized mortgage obligations 2 44 9,320 3 16 2,332 5 60 11,652 Asset-backed securities 2 101 29,389 1 66 3,213 3 167 32,602 Collateralized loan obligations 5 56 26,932 4 173 25,030 9 229 51,962 Total securities available-for-sale 15 $ 534 $ 84,211 16 $ 1,015 $ 47,323 31 $ 1,549 $ 131,534 Less than 12 months 12 months or more December 31, 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 $ 83 $ 3,923 1 $ 83 $ 3,923 U.S. government agencies 3 100 7,385 1 61 3,566 4 161 10,951 U.S. government agencies mortgage-backed - - - 11 377 11,439 11 377 11,439 States and political subdivisions 4 126 17,713 33 4,835 110,326 37 4,961 128,039 Collateralized mortgage obligations 2 309 15,211 10 1,835 43,687 12 2,144 58,898 Asset-backed securities - - - 4 225 16,473 4 225 16,473 Collateralized loan obligations 7 721 46,547 1 176 7,824 8 897 54,371 Total securities available-for-sale 16 $ 1,256 $ 86,856 61 $ 7,592 $ 197,238 77 $ 8,848 $ 284,094 Recognition of other-than-temporary impairment was not necessary as of the three months ended September 30, 2019. 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, 2019 and 2018. Three Months Ended Nine Months Ended September 30, September 30, Securities available-for-sale 2019 2018 2019 2018 Proceeds from sales of securities $ 57,228 $ 1,917 $ 177,824 $ 94,663 Gross realized gains on securities 3,841 23 5,432 370 Gross realized losses on securities (378) (10) (956) (10) Net realized gains $ 3,463 $ 13 $ 4,476 $ 360 Income tax expense on net realized gains $ (973) $ (3) $ (1,257) $ (100) Effective tax rate applied % % % % Securities valued at $328.8 million as of September 30, 2019, an increase from $311.2 million at year-end 2018, were pledged to secure deposits and borrowings, and for other purposes. |
Loans
Loans | 9 Months Ended |
Sep. 30, 2019 | |
Loans | |
Loans | Note 4 – Loans Major classifications of loans were as follows: September 30, 2019 December 31, 2018 Commercial $ 333,664 $ 314,323 Leases 108,152 78,806 Real estate - commercial 826,780 820,941 Real estate - construction 91,066 108,390 Real estate - residential 388,511 407,068 HELOC 126,309 140,442 Other 1 14,140 14,439 Total loans, excluding deferred loan costs and PCI loans 1,888,622 1,884,409 Net deferred loan costs 2,054 1,653 Total loans, excluding PCI loans 1,890,676 1,886,062 PCI loans, net of purchase accounting adjustments 9,135 10,965 Total loans $ 1,899,811 $ 1,897,027 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 75.4% and 77.9% of the portfolio at September 30, 2019, and December 31, 2018, 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, 2019 Past Due Past Due Due Due Current Nonaccrual Total Loans Accruing Commercial $ - $ - $ - $ - $ 333,516 $ 148 $ 333,664 $ - Leases - - - - 108,078 74 108,152 - Real estate - commercial Owner occupied general purpose 1,397 1,216 - 2,613 140,928 1,183 144,724 - Owner occupied special purpose 1,416 93 - 1,509 173,835 1,591 176,935 - Non-owner occupied general purpose 623 - - 623 328,870 564 330,057 - Non-owner occupied special purpose - - - - 106,043 2,960 109,003 - Retail properties 597 - - 597 51,015 1,122 52,734 - Farm - - - - 13,327 - 13,327 - Real estate - construction Homebuilder 93 - - 93 5,142 - 5,235 - Land - - - - 12,258 - 12,258 - Commercial speculative - - - - 51,991 - 51,991 - All other - - - - 21,488 94 21,582 - Real estate - residential Investor - 496 - 496 68,114 379 68,989 - Multi-family 1 - - 1 183,475 - 183,476 - Owner occupied 106 307 - 413 132,933 2,700 136,046 - HELOC 627 93 18 738 124,556 1,015 126,309 19 Other 1 7 - - 7 16,165 22 16,194 - Total, excluding PCI loans $ 4,867 $ 2,205 $ 18 $ 7,090 $ 1,871,734 $ 11,852 $ 1,890,676 $ 19 PCI loans, net of purchase accounting adjustments 865 - - 865 6,474 1,796 9,135 - Total $ 5,732 $ 2,205 $ 18 $ 7,955 $ 1,878,208 $ 13,648 $ 1,899,811 $ 19 Recorded Investment 90 days or 90 Days or Greater Past 30-59 Days 60-89 Days Greater Past Total Past Due and December 31, 2018 Past Due Past Due Due Due Current Nonaccrual Total Loans Accruing Commercial $ 58 $ - $ 352 $ 410 $ 313,913 $ - $ 314,323 $ 361 Leases - - - - 78,806 - 78,806 - Real estate - commercial Owner occupied general purpose 1,768 - 33 1,801 160,892 1,579 164,272 36 Owner occupied special purpose 826 135 - 961 192,426 395 193,782 - Non-owner occupied general purpose 2,832 203 - 3,035 286,115 4,236 293,386 - Non-owner occupied special purpose - - - - 106,036 3,099 109,135 - Retail properties - 620 - 620 45,968 - 46,588 - Farm - - - - 13,778 - 13,778 - Real estate - construction Homebuilder - - - - 5,102 - 5,102 - Land 266 - - 266 2,478 - 2,744 - Commercial speculative - - 350 350 55,060 - 55,410 355 All other - - - - 45,028 106 45,134 - Real estate - residential Investor 801 156 - 957 69,148 353 70,458 - Multi-family 545 - 179 724 195,504 - 196,228 180 Owner occupied 1,241 705 - 1,946 135,360 3,076 140,382 - HELOC 775 - - 775 138,801 866 140,442 - Other 1 53 5 3 61 16,000 31 16,092 3 Total, excluding PCI loans $ 9,165 $ 1,824 $ 917 $ 11,906 $ 1,860,415 $ 13,741 $ 1,886,062 $ 935 PCI loans, net of purchase accounting adjustments 1,452 - - 1,452 7,248 2,265 10,965 - Total $ 10,617 $ 1,824 $ 917 $ 13,358 $ 1,867,663 $ 16,006 $ 1,897,027 $ 935 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 to 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. The substandard credit quality indicator includes both potential problem loans that are currently performing and nonperforming loans. 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, 2019 Special Pass Mention Substandard Doubtful Total Commercial $ 316,680 $ 8,905 $ 8,079 $ - $ 333,664 Leases 108,078 - 74 - 108,152 Real estate - commercial Owner occupied general purpose 140,867 851 3,006 - 144,724 Owner occupied special purpose 170,525 4,819 1,591 - 176,935 Non-owner occupied general purpose 325,621 590 3,846 - 330,057 Non-owner occupied special purpose 106,043 - 2,960 - 109,003 Retail Properties 51,015 597 1,122 - 52,734 Farm 10,899 1,218 1,210 - 13,327 Real estate - construction Homebuilder 5,235 - - - 5,235 Land 12,258 - - - 12,258 Commercial speculative 51,991 - - - 51,991 All other 21,318 - 264 - 21,582 Real estate - residential Investor 68,005 - 984 - 68,989 Multi-Family 183,046 - 430 - 183,476 Owner occupied 132,146 134 3,766 - 136,046 HELOC 124,185 139 1,985 - 126,309 Other 1 15,832 340 22 - 16,194 Total, excluding PCI loans $ 1,843,744 $ 17,593 $ 29,339 $ - $ 1,890,676 PCI loans, net of purchase accounting adjustments 825 - 8,310 - 9,135 Total $ 1,844,569 $ 17,593 $ 37,649 $ - $ 1,899,811 December 31, 2018 Special Pass Mention Substandard Doubtful Total Commercial $ 305,993 $ 8,193 $ 137 $ - $ 314,323 Leases 78,806 - - - 78,806 Real estate - commercial Owner occupied general purpose 157,334 1,660 5,278 - 164,272 Owner occupied special purpose 186,218 3,429 4,135 - 193,782 Non-owner occupied general purpose 284,818 202 8,366 - 293,386 Non-owner occupied special purpose 104,526 1,510 3,099 - 109,135 Retail Properties 44,805 - 1,783 - 46,588 Farm 11,307 1,249 1,222 - 13,778 Real estate - construction Homebuilder 5,102 - - - 5,102 Land 2,744 - - - 2,744 Commercial speculative 55,410 - - - 55,410 All other 42,524 - 2,610 - 45,134 Real estate - residential Investor 69,242 - 1,216 - 70,458 Multi-Family 195,249 - 979 - 196,228 Owner occupied 135,858 - 4,524 - 140,382 HELOC 138,553 - 1,889 - 140,442 Other 1 16,061 - 31 - 16,092 Total, excluding PCI loans $ 1,834,550 $ 16,243 $ 35,269 $ - $ 1,886,062 PCI loans, net of purchase accounting adjustments 907 2,906 7,152 - 10,965 Total $ 1,835,457 $ 19,149 $ 42,421 $ - $ 1,897,027 1 The “Other” class includes consumer, overdrafts and net deferred costs. The Company had $425,000 and $448,000 in residential real estate loans in the process of foreclosure as of September 30, 2019 and December 31, 2018, respectively. The following tables set forth the recorded investments, unpaid principal balance and related allowance, excluding purchased credit-impaired loans, by class of loans as of September 30, 2019, and the average recorded investment and interest income recognized for the three and nine months ended September 30, 2019: Three Months Ended Nine Months Ended As of September 30, 2019 September 30, 2019 September 30, 2019 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 74 75 - 43 - 37 - Commercial real estate Owner occupied general purpose 1,254 1,328 - 1,108 2 1,457 5 Owner occupied special purpose 1,591 1,748 - 1,045 - 993 - Non-owner occupied general purpose 564 595 - 566 - 851 - Non-owner occupied special purpose 2,960 3,575 - 2,960 - 1,480 - Retail properties 1,122 1,159 - 1,130 - 561 - Farm - - - - - - - Construction Homebuilder - - - - - - - Land - - - - - - - Commercial speculative - - - - - - - All other 94 131 - 98 - 71 - Residential Investor 379 500 - 381 - 366 - Multi-Family - - - - - - - Owner occupied 3,059 4,595 - 3,078 11 3,209 32 HELOC 1,032 1,407 - 1,075 - 958 1 Other 1 4 4 - 4 - 6 - Total impaired loans with no recorded allowance 12,133 15,117 - 11,488 13 9,989 38 With an allowance recorded Commercial 148 150 110 149 - 74 - Leases - - - 57 - - - Commercial real estate Owner occupied general purpose 125 125 36 395 3 260 11 Owner occupied special purpose - - - - - - - Non-owner occupied general purpose 55 55 1 55 2 1,577 4 Non-owner occupied special purpose - - - - - 1,549 - Retail properties - - - - - - - Farm - - - - - - - Construction Homebuilder - - - - - - - Land - - - - - - - Commercial speculative - - - - - - - All other - - - - - 29 - Residential Investor 791 791 10 795 13 799 35 Multi-Family - - - - - - - Owner occupied 3,280 3,280 55 3,321 37 3,478 117 HELOC 1,359 1,359 55 1,370 20 1,358 59 Other 1 18 20 7 19 - 21 - Total impaired loans with a recorded allowance 5,776 5,780 274 6,161 75 9,145 226 Total impaired loans $ 17,909 $ 20,897 $ 274 $ 17,649 $ 88 $ 19,134 $ 264 1 The “Other” class includes consumer, overdrafts and net deferred costs. The following tables set forth the recorded investments, unpaid principal balance and related allowance, excluding purchased credit-impaired loans, by class of loans as of December 31, 2018, and the average recorded investment and interest income recognized for the three and nine months ended September 30, 2018: Three Months Ended Nine Months Ended As of December 31, 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 1,659 1,782 - 1,263 2 1,035 5 Owner occupied special purpose 395 530 - 417 - 375 - Non-owner occupied general purpose 1,138 1,159 - 91 - 653 - Non-owner occupied special purpose - - - - - - - Retail properties - - - - - - - Farm - - - - - - - Construction Homebuilder - - - - - - - Land - - - - - - - Commercial speculative - - - - - - - All other 49 73 - 121 - 125 - Residential Investor 353 459 - 368 - 369 - Multi-Family - - - - - 2,361 - Owner occupied 3,359 4,882 - 4,050 11 4,532 29 HELOC 884 1,003 - 687 - 880 1 Other 1 7 7 - 15 - 10 - Total impaired loans with no recorded allowance 7,844 9,895 - 7,012 13 10,340 35 With an allowance recorded Commercial - - - - - - - Leases - - - - - - - Commercial real estate Owner occupied general purpose 396 396 3 259 22 259 22 Owner occupied special purpose - - - - - - - Non-owner occupied general purpose 3,098 4,038 97 - - - - Non-owner occupied special purpose 3,099 3,575 139 3,099 - 1,550 - Retail properties - - - - - - - Farm - - - - - - - Construction Homebuilder - - - - - - - Land - - - - - - - Commercial speculative - - - - - - - All other 57 58 1 30 - 29 - Residential Investor 808 808 4 812 11 820 33 Multi-Family - - - - - - - Owner occupied 3,676 3,679 46 3,678 35 3,576 108 HELOC 1,357 1,357 49 1,371 17 1,203 41 Other 1 24 25 13 14 - 13 - Total impaired loans with a recorded allowance 12,515 13,936 352 9,263 85 7,450 204 Total impaired loans $ 20,359 $ 23,831 $ 352 $ 16,275 $ 98 $ 17,790 $ 239 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, 2019 Nine Months Ended September 30, 2019 # 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 Non-owner occupied general purpose Other 1 - $ - $ - 1 $ 58 $ 55 Retail properties Other 1 1 1,159 1,122 1 1,159 1,122 Real estate - residential Owner occupied HAMP 2 - - - 3 399 297 HELOC HAMP 2 - - - 1 39 34 Other 1 - - - 1 39 38 Total 1 $ 1,159 $ 1,122 7 $ 1,694 $ 1,546 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 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, 2019 and September 30, 2018, 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, 2019 and September 30, 2018. The Company acquired non-PCI loans when it purchased the Chicago branch of Talmer Bank and Trust in late 2016 and in its acquisition of ABC Bank in 2018. The accretable discount recorded in the third quarter of 2019 totaled $1.0 million; the balance of the non-PCI loan discount was $6.6 million as of September 30, 2019. In the third quarter of 2018, the accretable discount totaled $775,000; the balance of the non-PCI loan discount was $9.6 million as of September 30, 2018. The accretable discount recorded for the nine months ended 2019 totaled $1.8 million; the balance of the non-PCI loan discount was $6.6 million as of September 30, 2019. For the nine months ended 2018, the accretable discount totaled $2.0 million; the balance of the non-PCI loan discount was $9.6 million as of September 30, 2018. Purchased Accounting Accretion For the Three Months Ended Accretable Discount- Non-PCI Loans Accretable Discount- PCI Loans Non-Accretable Discount- PCI Loans Total Beginning balance, July 1, 2019 $ 1,216 $ 931 $ 5,500 $ 7,647 Accretion (217) (218) (606) (1,041) Transfer - 1 (1) - Ending balance, September 30, 2019 $ 999 $ 714 $ 4,893 $ 6,606 For the Three Months Ended 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 Accretion (312) (129) (334) (775) Transfer (373) (26) - (399) Ending balance, September 30, 2018 $ 2,310 $ 1,218 $ 6,069 $ 9,597 For the Nine Months Ended Accretable Discount - Non-PCI Loans Accretable Discount - PCI Loans Non-Accretable Discount - PCI Loans Total Beginning balance, January 1, 2019 $ 1,867 $ 1,099 $ 5,969 $ 8,935 Accretion (868) (340) (606) (1,814) Charge-offs - (48) (467) (515) Transfer - 3 (3) - Ending balance, September 30, 2019 $ 999 $ 714 $ 4,893 $ 6,606 For the Nine Months Ended Accretable Discount - Non-PCI Loans Accretable Discount - PCI Loans Non-Accretable Discount - PCI Loans Total Beginning balance, January 1, 2018 $ 835 $ - $ - $ 835 Purchases 3,182 1,551 6,536 11,269 Accretion (1,334) (305) (334) (1,973) Transfer (373) (28) (133) (534) Ending balance, September 30, 2018 $ 2,310 $ 1,218 $ 6,069 $ 9,597 |
Allowance for Loan Losses
Allowance for Loan Losses | 9 Months Ended |
Sep. 30, 2019 | |
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, 2019, 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, 2019 Beginning balance $ 3,377 $ 961 $ 10,517 $ 820 $ 1,790 $ 1,335 $ 572 $ 19,372 Charge-offs 20 47 159 7 3 19 142 397 Recoveries 10 - 12 - 22 21 61 126 (Release) Provision (49) 66 (88) (7) 56 (74) 646 550 Ending balance $ 3,318 $ 980 $ 10,282 $ 806 $ 1,865 $ 1,263 $ 1,137 $ 19,651 Nine months ended September 30, 2019 Beginning balance $ 2,832 $ 734 $ 10,470 $ 969 $ 1,931 $ 1,449 $ 621 $ 19,006 Charge-offs 99 47 432 8 21 298 311 1,216 Recoveries 46 - 47 1 86 79 152 411 Provision (Release) 539 293 197 (156) (131) 33 675 1,450 Ending balance $ 3,318 $ 980 $ 10,282 $ 806 $ 1,865 $ 1,263 $ 1,137 $ 19,651 Ending balance: Individually evaluated for impairment $ 110 $ - $ 37 $ - $ 65 $ 55 $ 7 $ 274 Ending balance: Collectively evaluated for impairment 3,208 980 9,690 806 1,800 1,208 1,113 18,805 Ending balance: Acquired and accounted for ASC 310-30 - - 555 - - - 17 572 Total ending allowance balance $ 3,318 $ 980 $ 10,282 $ 806 $ 1,865 $ 1,263 $ 1,137 $ 19,651 Loans: Ending balance: Individually evaluated for Impairment $ 148 $ 74 $ 7,671 $ 94 $ 7,509 $ 2,391 $ 22 $ 17,909 Ending balance: Collectively evaluated for impairment 333,516 108,078 819,109 90,972 381,002 123,918 16,172 1,872,767 Ending balance: Acquired and accounted for ASC 310-30 - - 3,933 637 4,565 - - 9,135 Total ending loans balance $ 333,664 $ 108,152 $ 830,713 $ 91,703 $ 393,076 $ 126,309 $ 16,194 $ 1,899,811 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 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 loan balance $ 306,407 $ 70,661 $ 808,310 $ 113,651 $ 399,581 $ 122,022 $ 14,317 $ 1,834,949 |
Other Real Estate Owned
Other Real Estate Owned | 9 Months Ended |
Sep. 30, 2019 | |
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 2019 2018 2019 2018 Balance at beginning of period $ 5,668 $ 8,912 $ 7,175 $ 8,371 Property additions, net of acquisition adjustments 305 (217) 305 2,595 Property improvements - - - 59 Less: Proceeds from property disposals, net of participation purchase and of gains/losses 1,088 1,612 2,390 3,576 Period valuation adjustments 203 119 399 485 Other adjustments - - 9 - Balance at end of period $ 4,682 $ 6,964 $ 4,682 $ 6,964 Activity in the valuation allowance was as follows: Three Months Ended Nine Months Ended September 30, September 30, 2019 2018 2019 2018 Balance at beginning of period $ 8,061 $ 8,348 $ 8,027 $ 8,208 Provision for unrealized losses 203 119 399 485 Reductions taken on sales (798) (456) (960) (682) Balance at end of period $ 7,466 $ 8,011 $ 7,466 $ 8,011 Expenses related to OREO, net of lease revenue includes: Three Months Ended Nine Months Ended September 30, September 30, 2019 2018 2019 2018 Gain on sales, net $ (104) $ (612) $ (254) $ (716) Provision for unrealized losses 203 119 399 485 Operating expenses (73) 133 184 502 Less: Lease revenue - 10 5 39 Net OREO expense $ 26 $ (370) $ 324 $ 232 |
Deposits
Deposits | 9 Months Ended |
Sep. 30, 2019 | |
Deposits | |
Deposits | Note 7 – Deposits Major classifications of deposits were as follows: September 30, 2019 December 31, 2018 Noninterest bearing demand $ 643,355 $ 618,830 Savings 304,726 304,400 NOW accounts 413,291 425,878 Money market accounts 286,484 310,390 Certificates of deposit of less than $100,000 222,378 230,781 Certificates of deposit of $100,000 through $250,000 142,669 159,953 Certificates of deposit of more than $250,000 61,588 66,441 Total deposits $ 2,074,491 $ 2,116,673 |
Borrowings
Borrowings | 9 Months Ended |
Sep. 30, 2019 | |
Borrowings | |
Borrowings | Note 8 – Borrowings The following table is a summary of borrowings as of September 30, 2019, and December 31, 2018. Junior subordinated debentures are discussed in detail in Note 9: September 30, 2019 December 31, 2018 Securities sold under repurchase agreements $ 48,870 $ 46,632 Other short-term borrowings 1 84,000 149,500 Junior subordinated debentures 57,722 57,686 Senior notes 44,244 44,158 Notes payable and other borrowings 8,856 15,379 Total borrowings $ 243,692 $ 313,355 1 Includes short-term FHLBC advances for both periods presented as well as the outstanding portion of an operating line of credit as of December 31, 2018, which totaled $4.0 million. 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 $48.9 million at September 30, 2019, and $46.6 million at December 31, 2018. The fair value of the pledged collateral was $62.4 million at September 30, 2019 and $72.8 million at December 31, 2018. At September 30, 2019, 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, 2019, the Bank had $84.0 million in short-term advances outstanding under the FHLBC compared to $145.5 million outstanding as of December 31, 2018; $65.0 million and $10.0 million of the September 30, 2019, balance was issued at 2.02% and 2.04%, respectively, and the remaining $8.9 million was issued at rates ranging from 1.76% to 2.23%. The additional $4.0 million in other short-term borrowings as of December 31, 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; advances under the line can be outstanding up to 360 days from the date of issuance. This line of credit was repaid with operating cash on hand in late January 2019. The Bank also assumed $23.4 million of long-term FHLBC advances with the ABC Bank acquisition. At September 30, 2019, these advances have a total outstanding balance of $8.9 million and are scheduled to mature over the next seven years with interest rates ranging between 2.19% and 2.83%. FHLBC stock held at September 30, 2019 was valued at $4.5 million, and any potential FHLBC advances were collateralized by securities with a fair value of $54.9 million and loans with a principal balance of $610.3 million, which carried a FHLBC-calculated combined collateral value of $464.1 million. The Company had excess collateral of $277.0 million available to secure borrowings at September 30, 2019. The increase in collateral availability of 367.4% since December 2018 is due to the completion of an analysis of FHLBC loan collateral eligibility in the first quarter of 2019, which expanded the capacity of funding at the FHLBC as additional loan collateral was deemed acceptable. The Company also has $44.2 million of senior notes outstanding, net of deferred issuance costs, as of September 30, 2019, and December 31, 2018. The senior notes were issued in December 2016 with a ten years maturity, 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, 2019, and December 31, 2018, unamortized debt issuance costs related to the senior notes were $756,000 and $842,000, 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, 2019 | |
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. Distributions on the securities are payable quarterly at an annual rate of 7.80%, unless the Company elects to defer such interest payments as permitted by the terms of the securities. 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 4.40% as of September 30, 2019, 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, 2019, and December 31, 2018, unamortized debt issuance costs related to the junior subordinated debentures were $657,000 and $692,000 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, 2019 | |
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”), the Company’s 2014 Equity Incentive Plan, as amended (the “2014 Plan”), and the Company’s 2019 Equity Incentive Plan (the “2019 Plan” and together with the 2008 Plan and the 2014 Plan, the “Plans”). The 2019 Plan was approved at the May 2019 annual stockholders’ meeting and the number of authorized shares under the 2019 Plan is fixed at 600,000. Following approval of the 2014 Plan, no further awards were to be granted under the 2008 Plan or any other prior Company equity compensation plan, and following the approval of the 2019 Plan, no further awards will be granted under the 2014 Plan. The 2019 Plan authorizes the granting of qualified stock options, non-qualified stock options, restricted stock, restricted stock units, and stock appreciation rights (“SARs”). Awards may be granted to selected directors, officers, employees or eligible service providers under the 2019 Plan at the discretion of the Compensation Committee of the Company’s Board of Directors. As of September 30, 2019, 433,894 shares remained available for issuance under the 2019 Plan. There were 4,500 stock options exercised and no stock options granted in the nine months ended September 30, 2019, and no stock options granted or exercised in the nine months ended September 30, 2018. 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, 2019, is as follows: Weighted- Weighted Average Average Remaining Exercise Contractual Aggregate Shares per Price Term (years) Intrinsic Value Beginning outstanding 4,500 $ 7.49 0.1 $ 25 Canceled - - - - Exercised (4,500) 7.49 - (27) Expired - - - - Ending outstanding - $ - - $ - Exercisable at end of period - $ - - $ - 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. Under the 2019 Plan, unless otherwise provided in an award agreement, upon the occurrence of a change in control, all stock options and SARs then held by the participant will become fully exercisable immediately if, and all stock awards and cash incentive awards will become fully earned and vested immediately if, (i) the 2019 Plan is not an obligation of the successor entity following a change in control or (ii) the 2019 Plan is an obligation of the successor entity following a change in control and the participant incurs a termination of service without cause or for good reason following the change in control. Notwithstanding the immediately preceding sentence, if the vesting of an award is conditioned upon the achievement of performance measures, then such vesting will generally be subject to the following: if, at the time of the change in control, the performance measures are less than 50% attained (pro rata based upon the time of the period through the change in control), the award will become vested and exercisable on a fractional basis with the numerator being equal to the percentage of attainment and the denominator being 50%; and if, at the time of the change in control, the performance measures are at least 50% attained (pro rata based upon the time of the period through the change in control), the award will become fully earned and vested immediately upon 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 166,106 restricted stock units issued under the 2019 Plan during the nine months ended September 30, 2019. There were 254,281 restricted stock units issued under the 2014 Plan during the nine months ended September 30, 2018. 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 Plans was $1.9 million and $1.7 million in the first nine months of 2019 and 2018, respectively. A summary of changes in the Company’s unvested restricted awards for the nine months ended September 30, 2019, is as follows: September 30, 2019 Weighted Restricted Average Stock Shares Grant Date and Units Fair Value Unvested at January 1 552,281 $ 11.30 Granted 166,106 12.77 Vested (123,937) 7.43 Forfeited - - Unvested at September 30 594,450 $ 12.52 Total unrecognized compensation cost of restricted awards was $3.6 million as of September 30, 2019, which is expected to be recognized over a weighted-average period of 1.97 years. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2019 | |
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: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Basic earnings per share: Weighted-average common shares outstanding 29,899,063 29,747,078 29,880,511 29,718,191 Net income $ 12,173 $ 9,642 $ 29,919 $ 25,392 Basic earnings per share $ 0.41 $ 0.32 $ 1.00 $ 0.85 Diluted earnings per share: Weighted-average common shares outstanding 29,899,063 29,747,078 29,880,511 29,718,191 Dilutive effect of unvested restricted awards 539,270 563,781 510,454 525,627 Dilutive effect of stock options and warrants - 73,032 - 53,476 Diluted average common shares outstanding 30,438,333 30,383,891 30,390,965 30,297,294 Net Income $ 12,173 $ 9,642 $ 29,919 $ 25,392 Diluted earnings per share $ 0.40 $ 0.32 $ 0.98 $ 0.84 The above 2018 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 was considered 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. This warrant was not included as a dilutive factor as of September 30, 2019, due to its cashless exercise on January 16, 2019. As of the date of exercise, the Company’s closing market stock price was $14.23 per share, resulting in 45,836 shares being issued. The cashless warrant exercise resulted in a net $313,000 reduction to treasury stock as these shares were issued from stock held by the Company. |
Regulatory & Capital Matters
Regulatory & Capital Matters | 9 Months Ended |
Sep. 30, 2019 | |
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 risk-based capital regulatory guidelines, the Bank’s Board of Directors has established an internal guideline requiring the Bank to 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, 2019, the Bank exceeded those thresholds. At September 30, 2019, the Bank’s Tier 1 capital leverage ratio was 12.68%, an increase of 132 basis points from December 31, 2018, and is well above the 8.00% objective. The Bank’s total capital ratio was 15.72%, an increase of 158 basis points from December 31, 2018, and also well above the objective of 12.00%. Bank holding companies are generally 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, 2019 and December 31, 2018. 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. The Basel III Rules are applicable to all banking organizations that are subject to minimum capital requirements, including federal and state banks and savings and loan associations, as well as to bank and savings and loan holding companies, other than “small bank holding companies” generally holding companies with consolidated assets of less than $3 billion. The Company is currently considered a “small bank holding company.” 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, 2018, under the heading “Supervision and Regulation.” At September 30, 2019, and December 31, 2018, 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 Well Capitalized Adequacy with Capital Under Prompt Corrective Actual Conservation Buffer, if applicable 1 Action Provisions 2 Amount Ratio Amount Ratio Amount Ratio September 30, 2019 Common equity tier 1 capital to risk weighted assets Consolidated $ 240,643 10.89 % $ 154,683 7.000 % N/A N/A Old Second Bank 325,983 14.83 153,869 7.000 $ 153,869 6.50 % Total capital to risk weighted assets Consolidated 316,914 14.34 232,050 10.500 N/A N/A Old Second Bank 345,629 15.72 230,859 10.500 230,859 10.00 Tier 1 capital to risk weighted assets Consolidated 297,268 13.45 187,865 8.500 N/A N/A Old Second Bank 325,983 14.83 186,841 8.500 186,841 8.00 Tier 1 capital to average assets Consolidated 297,268 11.54 103,039 4.00 N/A N/A Old Second Bank 325,983 12.68 102,834 4.00 128,542 5.00 December 31, 2018 Common equity tier 1 capital to risk weighted assets Consolidated $ 207,597 9.29 % $ 142,444 6.375 % N/A N/A Old Second Bank 295,599 13.29 141,791 6.375 $ 144,571 6.50 % Total capital to risk weighted assets Consolidated 282,126 12.63 220,648 9.875 N/A N/A Old Second Bank 314,600 14.14 219,637 9.875 222,417 10.00 Tier 1 capital to risk weighted assets Consolidated 263,125 11.78 175,960 7.875 N/A N/A Old Second Bank 295,599 13.29 175,153 7.875 177,934 8.00 Tier 1 capital to average assets Consolidated 263,125 10.08 104,415 4.00 N/A N/A Old Second Bank 295,599 11.36 104,084 4.00 130,105 5.00 1 As of September 30, 2019, amounts are shown inclusive of a capital conservation buffer of 2.50%; as compared to 1.875% at December 31, 2018. Under the Federal Reserve’s Small Bank Holding Company Policy Statement, the Company is not subject to the minimum capital adequacy and capital conservation buffer capital requirements at the holding company level, unless otherwise advised by the Federal Reserve (such capital requirements are applicable only at the Bank level). Although the minimum regulatory capital requirements are not applicable to the Company, we calculate these ratios for our own planning and monitoring purposes. 2 The prompt corrective action provisions are only applicable at the Bank level. 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 and were fully phased in as of January 1, 2019, the Bank must keep a capital conservation buffer of 2.50% above the new regulatory minimum capital requirements, which must consist entirely of Common Equity Tier 1 capital in order to avoid additional limitations on capital distributions and certain other payments. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2019 | |
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 fair value, less costs to sell. Fair values are based on third party appraisals of the property, resulting in a Level 3 classification, or an executed pending sales contract. 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, 2019, and December 31, 2018, respectively, measured by the Company at fair value on a recurring basis: September 30, 2019 Level 1 Level 2 Level 3 Total Assets: Securities available-for-sale U.S. Treasury $ 4,038 $ - $ - $ 4,038 U.S. government agencies - 9,143 - 9,143 U.S. government agencies mortgage-backed - 16,940 - 16,940 States and political subdivisions - 232,854 5,873 238,727 Collateralized mortgage obligations - 64,121 - 64,121 Asset-backed securities - 83,182 - 83,182 Collateralized loan obligations - 72,271 - 72,271 Loans held-for-sale - 5,592 - 5,592 Mortgage servicing rights - - 5,361 5,361 Interest rate swap agreements - 3,756 - 3,756 Mortgage banking derivatives - 453 - 453 Total $ 4,038 $ 488,312 $ 11,234 $ 503,584 Liabilities: Interest rate swap agreements, including risk participation agreements $ - $ 8,532 $ - $ 8,532 Total $ - $ 8,532 $ - $ 8,532 December 31, 2018 Level 1 Level 2 Level 3 Total Assets: Securities available-for-sale U.S. Treasury $ 3,923 $ - $ - $ 3,923 U.S. government agencies - 10,951 - 10,951 U.S. government agencies mortgage-backed - 14,075 - 14,075 States and political subdivisions - 265,902 8,165 274,067 Corporate bonds - - - - Collateralized mortgage obligations - 64,429 - 64,429 Asset-backed securities - 109,514 - 109,514 Collateralized loan obligations - 64,289 - 64,289 Loans held-for-sale - 2,984 - 2,984 Mortgage servicing rights - - 7,357 7,357 Interest rate swap agreements - 672 - 672 Mortgage banking derivatives - 159 - 159 Total $ 3,923 $ 532,975 $ 15,522 $ 552,420 Liabilities: Interest rate swap agreements, including risk participation agreements $ - $ 756 $ - $ 756 Total $ - $ 756 $ - $ 756 The changes in Level 3 assets and liabilities measured at fair value on a recurring basis are as follows: Nine Months Ended September 30, 2019 Securities available-for-sale Collateralized States and Mortgage Mortgage Political Servicing Obligation Subdivisions Rights Beginning balance January 1, 2019 $ - $ 8,165 $ 7,357 Transfers into Level 3 - - - Transfers out of Level 3 - - - Total gains or losses Included in earnings - (25) (2,384) Included in other comprehensive income - 898 - Purchases, issuances, sales, and settlements Purchases - 17,643 - Issuances - - 906 Settlements - (20,808) (518) Ending balance September 30, 2019 $ - $ 5,873 $ 5,361 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 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 The following table and commentary presents quantitative and qualitative information about Level 3 fair value measurements as of September 30, 2019: Weighted Measured at fair value Unobservable Average on a recurring basis: Fair Value Valuation Methodology Inputs Range of Input of Inputs Mortgage servicing rights $ 5,361 Discounted Cash Flow Discount Rate 10.0% - 17.0% 10.1 % Prepayment Speed 7.0 - 69.0% 16.6 % The following table and commentary presents quantitative and qualitative information about Level 3 fair value measurements as of December 31, 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 $ 7,357 Discounted Cash Flow Discount Rate 10.0 - 229.7% 10.2 % Prepayment Speed 7.0 - 68.9% 9.6 % In addition to the above, Level 3 fair value measurement included $5.9 million for state and political subdivisions representing various local municipality securities at September 30, 2019. This was classified as securities available-for-sale, and was 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, 2018, was $9.5 million and collateralized mortgage obligation balance in Level 3 was $1.6 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, 2019, and December 31, 2018, 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, 2019 Level 1 Level 2 Level 3 Total Impaired loans 1 $ - $ - $ 5,502 $ 5,502 Other real estate owned, net 2 - - 4,682 4,682 Total $ - $ - $ 10,184 $ 10,184 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 $5.8 million and a valuation allowance of $274,000 resulting in a decrease of specific allocations within the allowance for loan and lease losses of $78,000 for the nine months ended September 30, 2019. 2 OREO is measured at fair value, less costs to sell, and had a net carrying amount of $4.7 million, which is made up of the outstanding balance of $13.1 million, net of a valuation allowance of $8.1 million and a participation of $937,000 at September 30, 2019. December 31, 2018 Level 1 Level 2 Level 3 Total Impaired loans 1 $ - $ - $ 12,163 $ 12,163 Other real estate owned, net 2 - - 7,175 7,175 Total $ - $ - $ 19,338 $ 19,338 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 $12.5 million and a valuation allowance of $352,000, resulting in an increase of specific allocations within the allowance for loan and lease losses of $208,000 for the year December 31, 2018. 2 OREO is measured at fair value, less costs to sell, and had a net carrying amount of $7.2 million, which is made up of the outstanding balance of $16.0 million, net of a valuation allowance of $8.0 million and a participation of $900,000, at December 31, 2018. 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, 2019 | |
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. As of September 30, 2019 and 2018, the fair values of loans and leases are estimated on an exit price basis incorporating discounts for credit, liquidity and marketability factors. 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, 2019 Carrying Fair Amount Value Level 1 Level 2 Level 3 Financial assets: Cash and due from banks $ 42,671 $ 42,671 $ 42,671 $ - $ - Interest bearing deposits with financial institutions 11,366 11,366 11,366 - - Securities available-for-sale 488,422 488,422 4,038 478,511 5,873 FHLBC and FRBC stock 10,711 10,711 - 10,711 - Loans held-for-sale 5,592 5,592 - 5,592 - Net loans 1,880,160 1,915,103 - - 1,915,103 Accrued interest receivable 9,854 9,854 - 9,854 - Financial liabilities: Noninterest bearing deposits $ 643,355 $ 643,355 $ 643,355 $ - $ - Interest bearing deposits 1,431,136 1,431,267 - 1,431,267 - Securities sold under repurchase agreements 48,870 48,870 - 48,870 - Other short-term borrowings 84,000 84,000 - 84,000 - Junior subordinated debentures 57,722 42,170 34,557 7,613 - Senior notes 44,244 46,269 46,269 - - Note payable and other borrowings 8,856 8,856 - 8,856 - Interest rate swap agreements 4,696 4,696 - 4,696 - Borrowing interest payable 744 744 - 744 - Deposit interest payable 950 950 - 950 - December 31, 2018 Carrying Fair Amount Value Level 1 Level 2 Level 3 Financial assets: Cash and due from banks $ 38,599 $ 38,599 $ 38,599 $ - $ - Interest bearing deposits with financial institutions 16,636 16,636 16,636 - - Securities available-for-sale 541,248 541,248 3,923 529,160 8,165 FHLBC and FRBC stock 13,433 13,433 - 13,433 - Loans held-for-sale 2,984 2,984 - 2,984 - Net loans 1,878,021 1,867,594 - - 1,867,594 Accrued interest receivable 10,940 10,940 - 10,940 - Financial liabilities: Noninterest bearing deposits $ 618,830 $ 618,830 $ 618,830 $ - $ - Interest bearing deposits 1,497,843 1,495,614 - 1,495,614 - Securities sold under repurchase agreements 46,632 46,632 - 46,632 - Other short-term borrowings 149,500 149,500 - 149,500 - Junior subordinated debentures 57,686 47,625 32,989 14,636 - Senior notes 44,158 45,008 45,008 - - Note payable and other borrowings 15,379 15,379 - 15,379 - Interest rate swap agreements 58 58 - 58 - Borrowing interest payable 281 281 - 281 - Deposit interest payable 973 973 - 973 - |
Derivatives, Hedging and Financ
Derivatives, Hedging and Financial Instruments with Off-Balance Sheet Risk | 9 Months Ended |
Sep. 30, 2019 | |
Mortgage Banking Derivatives | |
Derivatives, Hedging Activities and Financial Instruments with Off-Balance Sheet Risk | 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 2019 and 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 $256,000 will be reclassified as an increase 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 Company entered into a forward starting interest rate swap on August 18, 2015, with an effective date of June 15, 2017. This transaction had a notional amount totaling $25.8 million as of December 31, 2018, was designated as a cash flow hedge of certain junior subordinated debentures and was determined to be fully effective during the period presented. As such, no amount of ineffectiveness has been included in net income. Therefore, the aggregate fair value of the swap is recorded in other liabilities with changes in fair value recorded in other comprehensive income, net of tax. The amount included in other comprehensive income would be reclassified to current earnings should all or a portion of the hedge no longer be considered effective. The Company expects the hedge to remain fully effective during the remaining term of the swap. The Bank will pay the counterparty a fixed rate and receive a floating rate based on three month LIBOR. The trust preferred securities changed from fixed rate to floating rate in June 15, 2017. The cash flow hedge has a maturity date of June 15, 2037. The Bank also has interest rate derivative positions to assist with risk management that are not designated as hedging instruments. These derivative positions relate to transactions in which the Bank enters an interest rate swap with a client while at the same time entering into an offsetting interest rate swap with another financial institution. The Bank had $176,000 of cash collateral pledged with one correspondent financial institution to support interest rate swap activity at September 30, 2019; $11.3 million of investment securities were required to be pledged to two correspondent financial institutions. The Bank had $260,000 of cash collateral pledged with one correspondent financial institution to support interest rate swap activity at December 31, 2018; no investment securities were required to be pledged. At September 30, 2019, the notional amount of non-hedging interest rate swaps was $174.5 million with a weighted average maturity of 6.0 years. At December 31, 2018, the notional amount of non-hedging interest rate swaps was $188.9 million with a weighted average maturity of 6.6 years. The Bank offsets derivative assets and liabilities that are subject to a master netting arrangement. 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, 2019, and December 31, 2018. Fair Value of Derivative Instruments September 30, 2019 No. of Trans. Notional Amount $ Balance Sheet Location Fair Value $ Balance Sheet Location Fair Value $ Derivatives designated as hedging instruments Interest rate swaps 25,774 Other Assets - Other Liabilities 4,696 Total derivatives designated as hedging instruments - 4,696 Derivatives not designated as hedging instruments Interest rate swaps with commercial loan customers 174,531 Other Assets 3,756 Other Liabilities 3,756 Interest rate lock commitments and forward contracts 50,520 Other Assets 453 Other Liabilities - Other contracts 28,231 Other Assets - Other Liabilities 79 Total derivatives not designated as hedging instruments 4,209 3,835 December 31, 2018 No. of Trans. Notional Amount $ Balance Sheet Location Fair Value $ Balance Sheet Location Fair Value $ Derivatives designated as hedging instruments Interest rate swaps 25,774 Other Assets - Other Liabilities 58 Total derivatives designated as hedging instruments - 58 Derivatives not designated as hedging instruments Interest rate swaps with commercial loan customers 188,931 Other Assets 672 Other Liabilities 672 Interest rate lock commitments and forward contracts 18,130 Other Assets 159 Other Liabilities - Other contracts 18,155 Other Assets - Other Liabilities 26 Total derivatives not designated as hedging instruments 831 698 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 $2.0 million as of September 30, 2019, and a loss in AOCI of $599,000 as of September 30, 2018. The amount of the loss reclassified from AOCI to interest income on the income statement totaled $12,000 and $29,000 for the three months ended September 30, 2019, and September 30, 2018, respectively. The amount of the loss reclassified from AOCI to interest income or interest expense on the income statement totaled $27,000 and $145,000 for the nine months ended September 30, 2019, and September 30, 2018, 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. 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, 2019, and December 31, 2018. The following table is a summary of letter of credit commitments: September 30, 2019 December 31, 2018 Fixed Variable Total Fixed Variable Total Letters of credit: Borrower: Financial standby $ 339 $ 7,418 $ 7,757 $ 327 $ 7,158 $ 7,485 Commercial standby - 354 354 - 397 397 Performance standby 571 6,312 6,883 532 6,381 6,913 910 14,084 14,994 859 13,936 14,795 Non-borrower: Performance standby - 67 67 - 67 67 Total letters of credit $ 910 $ 14,151 $ 15,061 $ 859 $ 14,003 $ 14,862 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2019 | |
Summary of Significant Accounting Policies | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements 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 adopted this standard as of January 1, 2019, and recorded right of use assets of $817,000 with a like lease liability. As of September 30, 2019, the right of use assets and lessee lease liability both totaled $3.3 million. The Company also recorded leases receivable related to lessor leases of $174,000 as of January 1, 2019 with a like entry to lease liabilities for the lessor position; these tenant leases receivable balances and lessor lease liabilities both totaled approximately $97,000 as of September 30, 2019. There was no impact to equity for the adoption of this standard on a modified retrospective basis. In June 2016, the FASB issued ASU No. 2016-13 “ Measurement of Credit Losses on Financial Instruments (Topic 326). ” This ASU 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 combination of loss rate models utilizing weighted average remaining life, migration and vintage analysis will be used for calculation of future expected losses based on data availability and the characteristics of each loan pool being assessed upon the ASU’s adoption in 2020. The Company has accumulated historical data by loan pools and collateral classifications, and is reviewing and refining the parallel calculation performed as of September 30, 2019, to confirm the model processes and determine financial statement impact prior to adoption in 2020. The Company is also developing internal control processes and disclosure documentation related to adoption of this standard. |
Subsequent Events | Subsequent Events On October 15, 2019, the Company’s Board of Directors declared a cash dividend of $0.01 per share payable on November 4, 2019, to stockholders of record as of October 25, 2019; dividends of $299,000 were paid to stockholders on November 4, 2019. |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
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 13,280 Deferred tax assets, net 3,459 Other assets 1,767 Total assets $ 336,949 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 5,623 Other short-term borrowings 10,875 Notes payable and other borrowings 23,367 Other liabilities 1,406 Total liabilities 289,769 Cash consideration paid 47,180 Total Liabilities Assumed and Cash Consideration Paid for Acquisition $ 336,949 |
Schedule of Acquired Loans as of Acquisition Date | April 20, 2018 September 30, 2019 ABC Bank Acquired Loans PCI Non-PCI PCI Non-PCI Fair Value $ 11,360 $ 216,234 $ 9,403 $ 134,536 Contractually required principal and interest payments 19,447 220,308 15,083 135,822 Best estimate of contractual cash flows not expected to be collected 6,537 2,511 4,893 614 Best estimate of contractual cash flows expected to be collected 12,910 217,797 10,190 135,208 |
Securities (Tables)
Securities (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
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, 2019 Cost Gains Losses Value Securities available-for-sale U.S. Treasuries $ 4,009 $ 29 $ - $ 4,038 U.S. government agencies 9,304 - (161) 9,143 U.S. government agencies mortgage-backed 16,338 619 (17) 16,940 States and political subdivisions 227,680 11,962 (915) 238,727 Collateralized mortgage obligations 62,965 1,216 (60) 64,121 Asset-backed securities 82,106 1,243 (167) 83,182 Collateralized loan obligations 72,454 46 (229) 72,271 Total securities available-for-sale $ 474,856 $ 15,115 $ (1,549) $ 488,422 Gross Gross Amortized Unrealized Unrealized Fair December 31, 2018 Cost Gains Losses Value Securities available-for-sale U.S. Treasury $ 4,006 $ - $ (83) $ 3,923 U.S. government agencies 11,112 - (161) 10,951 U.S. government agencies mortgage-backed 14,407 45 (377) 14,075 States and political subdivisions 277,112 1,916 (4,961) 274,067 Collateralized mortgage obligations 66,494 79 (2,144) 64,429 Asset-backed securities 108,574 1,165 (225) 109,514 Collateralized loan obligations 65,162 24 (897) 64,289 Total securities available-for-sale $ 546,867 $ 3,229 $ (8,848) $ 541,248 |
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 $ 736 1.92 % $ 736 Due after one year through five years 4,655 1.88 4,687 Due after five years through ten years 4,645 3.29 4,944 Due after ten years 230,957 3.04 241,541 240,993 3.02 251,908 Mortgage-backed and collateralized mortgage obligations 79,303 3.15 81,061 Asset-backed securities 82,106 3.27 83,182 Collateralized loan obligations 72,454 4.53 72,271 Total securities available-for-sale $ 474,856 3.31 % $ 488,422 |
Schedule of amortized cost and fair value of securities that exceed 10% of stockholders equity | The Company has invested in securities issued from two originators that individually amount to over 10% of the Company’s stockholders equity. Information regarding these two issuers and the value of the securities issued follows: September 30, 2019 Amortized Fair Issuer Cost Value GCO Education Loan Funding Corp $ 27,840 $ 27,744 Towd Point Mortgage Trust 33,744 34,378 |
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, 2019 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 - $ - $ - - $ - $ - - $ - $ - U.S. government agencies - - - 4 161 9,143 4 161 9,143 U.S. government agencies mortgage-backed 3 7 3,044 2 10 848 5 17 3,892 States and political subdivisions 3 326 15,526 2 589 6,757 5 915 22,283 Collateralized mortgage obligations 2 44 9,320 3 16 2,332 5 60 11,652 Asset-backed securities 2 101 29,389 1 66 3,213 3 167 32,602 Collateralized loan obligations 5 56 26,932 4 173 25,030 9 229 51,962 Total securities available-for-sale 15 $ 534 $ 84,211 16 $ 1,015 $ 47,323 31 $ 1,549 $ 131,534 Less than 12 months 12 months or more December 31, 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 $ 83 $ 3,923 1 $ 83 $ 3,923 U.S. government agencies 3 100 7,385 1 61 3,566 4 161 10,951 U.S. government agencies mortgage-backed - - - 11 377 11,439 11 377 11,439 States and political subdivisions 4 126 17,713 33 4,835 110,326 37 4,961 128,039 Collateralized mortgage obligations 2 309 15,211 10 1,835 43,687 12 2,144 58,898 Asset-backed securities - - - 4 225 16,473 4 225 16,473 Collateralized loan obligations 7 721 46,547 1 176 7,824 8 897 54,371 Total securities available-for-sale 16 $ 1,256 $ 86,856 61 $ 7,592 $ 197,238 77 $ 8,848 $ 284,094 |
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 2019 2018 2019 2018 Proceeds from sales of securities $ 57,228 $ 1,917 $ 177,824 $ 94,663 Gross realized gains on securities 3,841 23 5,432 370 Gross realized losses on securities (378) (10) (956) (10) Net realized gains $ 3,463 $ 13 $ 4,476 $ 360 Income tax expense on net realized gains $ (973) $ (3) $ (1,257) $ (100) Effective tax rate applied % % % % |
Loans (Tables)
Loans (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Loans | |
Schedule of major classifications of loans | September 30, 2019 December 31, 2018 Commercial $ 333,664 $ 314,323 Leases 108,152 78,806 Real estate - commercial 826,780 820,941 Real estate - construction 91,066 108,390 Real estate - residential 388,511 407,068 HELOC 126,309 140,442 Other 1 14,140 14,439 Total loans, excluding deferred loan costs and PCI loans 1,888,622 1,884,409 Net deferred loan costs 2,054 1,653 Total loans, excluding PCI loans 1,890,676 1,886,062 PCI loans, net of purchase accounting adjustments 9,135 10,965 Total loans $ 1,899,811 $ 1,897,027 |
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, 2019 Past Due Past Due Due Due Current Nonaccrual Total Loans Accruing Commercial $ - $ - $ - $ - $ 333,516 $ 148 $ 333,664 $ - Leases - - - - 108,078 74 108,152 - Real estate - commercial Owner occupied general purpose 1,397 1,216 - 2,613 140,928 1,183 144,724 - Owner occupied special purpose 1,416 93 - 1,509 173,835 1,591 176,935 - Non-owner occupied general purpose 623 - - 623 328,870 564 330,057 - Non-owner occupied special purpose - - - - 106,043 2,960 109,003 - Retail properties 597 - - 597 51,015 1,122 52,734 - Farm - - - - 13,327 - 13,327 - Real estate - construction Homebuilder 93 - - 93 5,142 - 5,235 - Land - - - - 12,258 - 12,258 - Commercial speculative - - - - 51,991 - 51,991 - All other - - - - 21,488 94 21,582 - Real estate - residential Investor - 496 - 496 68,114 379 68,989 - Multi-family 1 - - 1 183,475 - 183,476 - Owner occupied 106 307 - 413 132,933 2,700 136,046 - HELOC 627 93 18 738 124,556 1,015 126,309 19 Other 1 7 - - 7 16,165 22 16,194 - Total, excluding PCI loans $ 4,867 $ 2,205 $ 18 $ 7,090 $ 1,871,734 $ 11,852 $ 1,890,676 $ 19 PCI loans, net of purchase accounting adjustments 865 - - 865 6,474 1,796 9,135 - Total $ 5,732 $ 2,205 $ 18 $ 7,955 $ 1,878,208 $ 13,648 $ 1,899,811 $ 19 Recorded Investment 90 days or 90 Days or Greater Past 30-59 Days 60-89 Days Greater Past Total Past Due and December 31, 2018 Past Due Past Due Due Due Current Nonaccrual Total Loans Accruing Commercial $ 58 $ - $ 352 $ 410 $ 313,913 $ - $ 314,323 $ 361 Leases - - - - 78,806 - 78,806 - Real estate - commercial Owner occupied general purpose 1,768 - 33 1,801 160,892 1,579 164,272 36 Owner occupied special purpose 826 135 - 961 192,426 395 193,782 - Non-owner occupied general purpose 2,832 203 - 3,035 286,115 4,236 293,386 - Non-owner occupied special purpose - - - - 106,036 3,099 109,135 - Retail properties - 620 - 620 45,968 - 46,588 - Farm - - - - 13,778 - 13,778 - Real estate - construction Homebuilder - - - - 5,102 - 5,102 - Land 266 - - 266 2,478 - 2,744 - Commercial speculative - - 350 350 55,060 - 55,410 355 All other - - - - 45,028 106 45,134 - Real estate - residential Investor 801 156 - 957 69,148 353 70,458 - Multi-family 545 - 179 724 195,504 - 196,228 180 Owner occupied 1,241 705 - 1,946 135,360 3,076 140,382 - HELOC 775 - - 775 138,801 866 140,442 - Other 1 53 5 3 61 16,000 31 16,092 3 Total, excluding PCI loans $ 9,165 $ 1,824 $ 917 $ 11,906 $ 1,860,415 $ 13,741 $ 1,886,062 $ 935 PCI loans, net of purchase accounting adjustments 1,452 - - 1,452 7,248 2,265 10,965 - Total $ 10,617 $ 1,824 $ 917 $ 13,358 $ 1,867,663 $ 16,006 $ 1,897,027 $ 935 1 The “Other” class includes consumer, overdrafts and net deferred costs. |
Schedule of credit quality indicators by class of loans | September 30, 2019 Special Pass Mention Substandard Doubtful Total Commercial $ 316,680 $ 8,905 $ 8,079 $ - $ 333,664 Leases 108,078 - 74 - 108,152 Real estate - commercial Owner occupied general purpose 140,867 851 3,006 - 144,724 Owner occupied special purpose 170,525 4,819 1,591 - 176,935 Non-owner occupied general purpose 325,621 590 3,846 - 330,057 Non-owner occupied special purpose 106,043 - 2,960 - 109,003 Retail Properties 51,015 597 1,122 - 52,734 Farm 10,899 1,218 1,210 - 13,327 Real estate - construction Homebuilder 5,235 - - - 5,235 Land 12,258 - - - 12,258 Commercial speculative 51,991 - - - 51,991 All other 21,318 - 264 - 21,582 Real estate - residential Investor 68,005 - 984 - 68,989 Multi-Family 183,046 - 430 - 183,476 Owner occupied 132,146 134 3,766 - 136,046 HELOC 124,185 139 1,985 - 126,309 Other 1 15,832 340 22 - 16,194 Total, excluding PCI loans $ 1,843,744 $ 17,593 $ 29,339 $ - $ 1,890,676 PCI loans, net of purchase accounting adjustments 825 - 8,310 - 9,135 Total $ 1,844,569 $ 17,593 $ 37,649 $ - $ 1,899,811 December 31, 2018 Special Pass Mention Substandard Doubtful Total Commercial $ 305,993 $ 8,193 $ 137 $ - $ 314,323 Leases 78,806 - - - 78,806 Real estate - commercial Owner occupied general purpose 157,334 1,660 5,278 - 164,272 Owner occupied special purpose 186,218 3,429 4,135 - 193,782 Non-owner occupied general purpose 284,818 202 8,366 - 293,386 Non-owner occupied special purpose 104,526 1,510 3,099 - 109,135 Retail Properties 44,805 - 1,783 - 46,588 Farm 11,307 1,249 1,222 - 13,778 Real estate - construction Homebuilder 5,102 - - - 5,102 Land 2,744 - - - 2,744 Commercial speculative 55,410 - - - 55,410 All other 42,524 - 2,610 - 45,134 Real estate - residential Investor 69,242 - 1,216 - 70,458 Multi-Family 195,249 - 979 - 196,228 Owner occupied 135,858 - 4,524 - 140,382 HELOC 138,553 - 1,889 - 140,442 Other 1 16,061 - 31 - 16,092 Total, excluding PCI loans $ 1,834,550 $ 16,243 $ 35,269 $ - $ 1,886,062 PCI loans, net of purchase accounting adjustments 907 2,906 7,152 - 10,965 Total $ 1,835,457 $ 19,149 $ 42,421 $ - $ 1,897,027 1 The “Other” class includes consumer, overdrafts and net deferred costs. |
Schedule of impaired loans by class of loan | Three Months Ended Nine Months Ended As of September 30, 2019 September 30, 2019 September 30, 2019 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 74 75 - 43 - 37 - Commercial real estate Owner occupied general purpose 1,254 1,328 - 1,108 2 1,457 5 Owner occupied special purpose 1,591 1,748 - 1,045 - 993 - Non-owner occupied general purpose 564 595 - 566 - 851 - Non-owner occupied special purpose 2,960 3,575 - 2,960 - 1,480 - Retail properties 1,122 1,159 - 1,130 - 561 - Farm - - - - - - - Construction Homebuilder - - - - - - - Land - - - - - - - Commercial speculative - - - - - - - All other 94 131 - 98 - 71 - Residential Investor 379 500 - 381 - 366 - Multi-Family - - - - - - - Owner occupied 3,059 4,595 - 3,078 11 3,209 32 HELOC 1,032 1,407 - 1,075 - 958 1 Other 1 4 4 - 4 - 6 - Total impaired loans with no recorded allowance 12,133 15,117 - 11,488 13 9,989 38 With an allowance recorded Commercial 148 150 110 149 - 74 - Leases - - - 57 - - - Commercial real estate Owner occupied general purpose 125 125 36 395 3 260 11 Owner occupied special purpose - - - - - - - Non-owner occupied general purpose 55 55 1 55 2 1,577 4 Non-owner occupied special purpose - - - - - 1,549 - Retail properties - - - - - - - Farm - - - - - - - Construction Homebuilder - - - - - - - Land - - - - - - - Commercial speculative - - - - - - - All other - - - - - 29 - Residential Investor 791 791 10 795 13 799 35 Multi-Family - - - - - - - Owner occupied 3,280 3,280 55 3,321 37 3,478 117 HELOC 1,359 1,359 55 1,370 20 1,358 59 Other 1 18 20 7 19 - 21 - Total impaired loans with a recorded allowance 5,776 5,780 274 6,161 75 9,145 226 Total impaired loans $ 17,909 $ 20,897 $ 274 $ 17,649 $ 88 $ 19,134 $ 264 1 The “Other” class includes consumer, overdrafts and net deferred costs. The following tables set forth the recorded investments, unpaid principal balance and related allowance, excluding purchased credit-impaired loans, by class of loans as of December 31, 2018, and the average recorded investment and interest income recognized for the three and nine months ended September 30, 2018: Three Months Ended Nine Months Ended As of December 31, 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 1,659 1,782 - 1,263 2 1,035 5 Owner occupied special purpose 395 530 - 417 - 375 - Non-owner occupied general purpose 1,138 1,159 - 91 - 653 - Non-owner occupied special purpose - - - - - - - Retail properties - - - - - - - Farm - - - - - - - Construction Homebuilder - - - - - - - Land - - - - - - - Commercial speculative - - - - - - - All other 49 73 - 121 - 125 - Residential Investor 353 459 - 368 - 369 - Multi-Family - - - - - 2,361 - Owner occupied 3,359 4,882 - 4,050 11 4,532 29 HELOC 884 1,003 - 687 - 880 1 Other 1 7 7 - 15 - 10 - Total impaired loans with no recorded allowance 7,844 9,895 - 7,012 13 10,340 35 With an allowance recorded Commercial - - - - - - - Leases - - - - - - - Commercial real estate Owner occupied general purpose 396 396 3 259 22 259 22 Owner occupied special purpose - - - - - - - Non-owner occupied general purpose 3,098 4,038 97 - - - - Non-owner occupied special purpose 3,099 3,575 139 3,099 - 1,550 - Retail properties - - - - - - - Farm - - - - - - - Construction Homebuilder - - - - - - - Land - - - - - - - Commercial speculative - - - - - - - All other 57 58 1 30 - 29 - Residential Investor 808 808 4 812 11 820 33 Multi-Family - - - - - - - Owner occupied 3,676 3,679 46 3,678 35 3,576 108 HELOC 1,357 1,357 49 1,371 17 1,203 41 Other 1 24 25 13 14 - 13 - Total impaired loans with a recorded allowance 12,515 13,936 352 9,263 85 7,450 204 Total impaired loans $ 20,359 $ 23,831 $ 352 $ 16,275 $ 98 $ 17,790 $ 239 |
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, 2019 Nine Months Ended September 30, 2019 # 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 Non-owner occupied general purpose Other 1 - $ - $ - 1 $ 58 $ 55 Retail properties Other 1 1 1,159 1,122 1 1,159 1,122 Real estate - residential Owner occupied HAMP 2 - - - 3 399 297 HELOC HAMP 2 - - - 1 39 34 Other 1 - - - 1 39 38 Total 1 $ 1,159 $ 1,122 7 $ 1,694 $ 1,546 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 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 | Purchased Accounting Accretion For the Three Months Ended Accretable Discount- Non-PCI Loans Accretable Discount- PCI Loans Non-Accretable Discount- PCI Loans Total Beginning balance, July 1, 2019 $ 1,216 $ 931 $ 5,500 $ 7,647 Accretion (217) (218) (606) (1,041) Transfer - 1 (1) - Ending balance, September 30, 2019 $ 999 $ 714 $ 4,893 $ 6,606 For the Three Months Ended 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 Accretion (312) (129) (334) (775) Transfer (373) (26) - (399) Ending balance, September 30, 2018 $ 2,310 $ 1,218 $ 6,069 $ 9,597 For the Nine Months Ended Accretable Discount - Non-PCI Loans Accretable Discount - PCI Loans Non-Accretable Discount - PCI Loans Total Beginning balance, January 1, 2019 $ 1,867 $ 1,099 $ 5,969 $ 8,935 Accretion (868) (340) (606) (1,814) Charge-offs - (48) (467) (515) Transfer - 3 (3) - Ending balance, September 30, 2019 $ 999 $ 714 $ 4,893 $ 6,606 For the Nine Months Ended Accretable Discount - Non-PCI Loans Accretable Discount - PCI Loans Non-Accretable Discount - PCI Loans Total Beginning balance, January 1, 2018 $ 835 $ - $ - $ 835 Purchases 3,182 1,551 6,536 11,269 Accretion (1,334) (305) (334) (1,973) Transfer (373) (28) (133) (534) Ending balance, September 30, 2018 $ 2,310 $ 1,218 $ 6,069 $ 9,597 |
Allowance for Loan Losses (Tabl
Allowance for Loan Losses (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
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, 2019, 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, 2019 Beginning balance $ 3,377 $ 961 $ 10,517 $ 820 $ 1,790 $ 1,335 $ 572 $ 19,372 Charge-offs 20 47 159 7 3 19 142 397 Recoveries 10 - 12 - 22 21 61 126 (Release) Provision (49) 66 (88) (7) 56 (74) 646 550 Ending balance $ 3,318 $ 980 $ 10,282 $ 806 $ 1,865 $ 1,263 $ 1,137 $ 19,651 Nine months ended September 30, 2019 Beginning balance $ 2,832 $ 734 $ 10,470 $ 969 $ 1,931 $ 1,449 $ 621 $ 19,006 Charge-offs 99 47 432 8 21 298 311 1,216 Recoveries 46 - 47 1 86 79 152 411 Provision (Release) 539 293 197 (156) (131) 33 675 1,450 Ending balance $ 3,318 $ 980 $ 10,282 $ 806 $ 1,865 $ 1,263 $ 1,137 $ 19,651 Ending balance: Individually evaluated for impairment $ 110 $ - $ 37 $ - $ 65 $ 55 $ 7 $ 274 Ending balance: Collectively evaluated for impairment 3,208 980 9,690 806 1,800 1,208 1,113 18,805 Ending balance: Acquired and accounted for ASC 310-30 - - 555 - - - 17 572 Total ending allowance balance $ 3,318 $ 980 $ 10,282 $ 806 $ 1,865 $ 1,263 $ 1,137 $ 19,651 Loans: Ending balance: Individually evaluated for Impairment $ 148 $ 74 $ 7,671 $ 94 $ 7,509 $ 2,391 $ 22 $ 17,909 Ending balance: Collectively evaluated for impairment 333,516 108,078 819,109 90,972 381,002 123,918 16,172 1,872,767 Ending balance: Acquired and accounted for ASC 310-30 - - 3,933 637 4,565 - - 9,135 Total ending loans balance $ 333,664 $ 108,152 $ 830,713 $ 91,703 $ 393,076 $ 126,309 $ 16,194 $ 1,899,811 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 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 loan balance $ 306,407 $ 70,661 $ 808,310 $ 113,651 $ 399,581 $ 122,022 $ 14,317 $ 1,834,949 |
Other Real Estate Owned (Tables
Other Real Estate Owned (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
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 2019 2018 2019 2018 Balance at beginning of period $ 5,668 $ 8,912 $ 7,175 $ 8,371 Property additions, net of acquisition adjustments 305 (217) 305 2,595 Property improvements - - - 59 Less: Proceeds from property disposals, net of participation purchase and of gains/losses 1,088 1,612 2,390 3,576 Period valuation adjustments 203 119 399 485 Other adjustments - - 9 - Balance at end of period $ 4,682 $ 6,964 $ 4,682 $ 6,964 |
Schedule of activity in valuation allowance | Three Months Ended Nine Months Ended September 30, September 30, 2019 2018 2019 2018 Balance at beginning of period $ 8,061 $ 8,348 $ 8,027 $ 8,208 Provision for unrealized losses 203 119 399 485 Reductions taken on sales (798) (456) (960) (682) Balance at end of period $ 7,466 $ 8,011 $ 7,466 $ 8,011 |
Schedule of expenses related to foreclosed assets, net of lease revenue | Three Months Ended Nine Months Ended September 30, September 30, 2019 2018 2019 2018 Gain on sales, net $ (104) $ (612) $ (254) $ (716) Provision for unrealized losses 203 119 399 485 Operating expenses (73) 133 184 502 Less: Lease revenue - 10 5 39 Net OREO expense $ 26 $ (370) $ 324 $ 232 |
Deposits (Tables)
Deposits (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Deposits | |
Schedule of major classifications of deposits | September 30, 2019 December 31, 2018 Noninterest bearing demand $ 643,355 $ 618,830 Savings 304,726 304,400 NOW accounts 413,291 425,878 Money market accounts 286,484 310,390 Certificates of deposit of less than $100,000 222,378 230,781 Certificates of deposit of $100,000 through $250,000 142,669 159,953 Certificates of deposit of more than $250,000 61,588 66,441 Total deposits $ 2,074,491 $ 2,116,673 |
Borrowings (Tables)
Borrowings (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Borrowings | |
Summary of borrowings and junior subordinated debentures | September 30, 2019 December 31, 2018 Securities sold under repurchase agreements $ 48,870 $ 46,632 Other short-term borrowings 1 84,000 149,500 Junior subordinated debentures 57,722 57,686 Senior notes 44,244 44,158 Notes payable and other borrowings 8,856 15,379 Total borrowings $ 243,692 $ 313,355 1 Includes short-term FHLBC advances for both periods presented as well as the outstanding portion of an operating line of credit as of December 31, 2018, which totaled $4.0 million. |
Equity Compensation Plans (Tabl
Equity Compensation Plans (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
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, 2019, is as follows: Weighted- Weighted Average Average Remaining Exercise Contractual Aggregate Shares per Price Term (years) Intrinsic Value Beginning outstanding 4,500 $ 7.49 0.1 $ 25 Canceled - - - - Exercised (4,500) 7.49 - (27) Expired - - - - Ending outstanding - $ - - $ - Exercisable at end of period - $ - - $ - |
Summary of changes in nonvested shares of restricted share rights | September 30, 2019 Weighted Restricted Average Stock Shares Grant Date and Units Fair Value Unvested at January 1 552,281 $ 11.30 Granted 166,106 12.77 Vested (123,937) 7.43 Forfeited - - Unvested at September 30 594,450 $ 12.52 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share | |
Schedule of Earnings Per Share | Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Basic earnings per share: Weighted-average common shares outstanding 29,899,063 29,747,078 29,880,511 29,718,191 Net income $ 12,173 $ 9,642 $ 29,919 $ 25,392 Basic earnings per share $ 0.41 $ 0.32 $ 1.00 $ 0.85 Diluted earnings per share: Weighted-average common shares outstanding 29,899,063 29,747,078 29,880,511 29,718,191 Dilutive effect of unvested restricted awards 539,270 563,781 510,454 525,627 Dilutive effect of stock options and warrants - 73,032 - 53,476 Diluted average common shares outstanding 30,438,333 30,383,891 30,390,965 30,297,294 Net Income $ 12,173 $ 9,642 $ 29,919 $ 25,392 Diluted earnings per share $ 0.40 $ 0.32 $ 0.98 $ 0.84 |
Regulatory & Capital Matters (T
Regulatory & Capital Matters (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
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 Well Capitalized Adequacy with Capital Under Prompt Corrective Actual Conservation Buffer, if applicable 1 Action Provisions 2 Amount Ratio Amount Ratio Amount Ratio September 30, 2019 Common equity tier 1 capital to risk weighted assets Consolidated $ 240,643 10.89 % $ 154,683 7.000 % N/A N/A Old Second Bank 325,983 14.83 153,869 7.000 $ 153,869 6.50 % Total capital to risk weighted assets Consolidated 316,914 14.34 232,050 10.500 N/A N/A Old Second Bank 345,629 15.72 230,859 10.500 230,859 10.00 Tier 1 capital to risk weighted assets Consolidated 297,268 13.45 187,865 8.500 N/A N/A Old Second Bank 325,983 14.83 186,841 8.500 186,841 8.00 Tier 1 capital to average assets Consolidated 297,268 11.54 103,039 4.00 N/A N/A Old Second Bank 325,983 12.68 102,834 4.00 128,542 5.00 December 31, 2018 Common equity tier 1 capital to risk weighted assets Consolidated $ 207,597 9.29 % $ 142,444 6.375 % N/A N/A Old Second Bank 295,599 13.29 141,791 6.375 $ 144,571 6.50 % Total capital to risk weighted assets Consolidated 282,126 12.63 220,648 9.875 N/A N/A Old Second Bank 314,600 14.14 219,637 9.875 222,417 10.00 Tier 1 capital to risk weighted assets Consolidated 263,125 11.78 175,960 7.875 N/A N/A Old Second Bank 295,599 13.29 175,153 7.875 177,934 8.00 Tier 1 capital to average assets Consolidated 263,125 10.08 104,415 4.00 N/A N/A Old Second Bank 295,599 11.36 104,084 4.00 130,105 5.00 1 As of September 30, 2019, amounts are shown inclusive of a capital conservation buffer of 2.50%; as compared to 1.875% at December 31, 2018. Under the Federal Reserve’s Small Bank Holding Company Policy Statement, the Company is not subject to the minimum capital adequacy and capital conservation buffer capital requirements at the holding company level, unless otherwise advised by the Federal Reserve (such capital requirements are applicable only at the Bank level). Although the minimum regulatory capital requirements are not applicable to the Company, we calculate these ratios for our own planning and monitoring purposes. 2 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Measurements | |
Schedule of balance of assets and liabilities which are measured at fair value on a recurring basis | September 30, 2019 Level 1 Level 2 Level 3 Total Assets: Securities available-for-sale U.S. Treasury $ 4,038 $ - $ - $ 4,038 U.S. government agencies - 9,143 - 9,143 U.S. government agencies mortgage-backed - 16,940 - 16,940 States and political subdivisions - 232,854 5,873 238,727 Collateralized mortgage obligations - 64,121 - 64,121 Asset-backed securities - 83,182 - 83,182 Collateralized loan obligations - 72,271 - 72,271 Loans held-for-sale - 5,592 - 5,592 Mortgage servicing rights - - 5,361 5,361 Interest rate swap agreements - 3,756 - 3,756 Mortgage banking derivatives - 453 - 453 Total $ 4,038 $ 488,312 $ 11,234 $ 503,584 Liabilities: Interest rate swap agreements, including risk participation agreements $ - $ 8,532 $ - $ 8,532 Total $ - $ 8,532 $ - $ 8,532 December 31, 2018 Level 1 Level 2 Level 3 Total Assets: Securities available-for-sale U.S. Treasury $ 3,923 $ - $ - $ 3,923 U.S. government agencies - 10,951 - 10,951 U.S. government agencies mortgage-backed - 14,075 - 14,075 States and political subdivisions - 265,902 8,165 274,067 Corporate bonds - - - - Collateralized mortgage obligations - 64,429 - 64,429 Asset-backed securities - 109,514 - 109,514 Collateralized loan obligations - 64,289 - 64,289 Loans held-for-sale - 2,984 - 2,984 Mortgage servicing rights - - 7,357 7,357 Interest rate swap agreements - 672 - 672 Mortgage banking derivatives - 159 - 159 Total $ 3,923 $ 532,975 $ 15,522 $ 552,420 Liabilities: Interest rate swap agreements, including risk participation agreements $ - $ 756 $ - $ 756 Total $ - $ 756 $ - $ 756 |
Schedule of changes in Level 3 assets and liabilities measured at fair value on a recurring basis | Nine Months Ended September 30, 2019 Securities available-for-sale Collateralized States and Mortgage Mortgage Political Servicing Obligation Subdivisions Rights Beginning balance January 1, 2019 $ - $ 8,165 $ 7,357 Transfers into Level 3 - - - Transfers out of Level 3 - - - Total gains or losses Included in earnings - (25) (2,384) Included in other comprehensive income - 898 - Purchases, issuances, sales, and settlements Purchases - 17,643 - Issuances - - 906 Settlements - (20,808) (518) Ending balance September 30, 2019 $ - $ 5,873 $ 5,361 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 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 |
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, 2019: Weighted Measured at fair value Unobservable Average on a recurring basis: Fair Value Valuation Methodology Inputs Range of Input of Inputs Mortgage servicing rights $ 5,361 Discounted Cash Flow Discount Rate 10.0% - 17.0% 10.1 % Prepayment Speed 7.0 - 69.0% 16.6 % The following table and commentary presents quantitative and qualitative information about Level 3 fair value measurements as of December 31, 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 $ 7,357 Discounted Cash Flow Discount Rate 10.0 - 229.7% 10.2 % Prepayment Speed 7.0 - 68.9% 9.6 % |
Schedule of assets measured at fair value on a nonrecurring basis | September 30, 2019 Level 1 Level 2 Level 3 Total Impaired loans 1 $ - $ - $ 5,502 $ 5,502 Other real estate owned, net 2 - - 4,682 4,682 Total $ - $ - $ 10,184 $ 10,184 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 $5.8 million and a valuation allowance of $274,000 resulting in a decrease of specific allocations within the allowance for loan and lease losses of $78,000 for the nine months ended September 30, 2019. 2 OREO is measured at fair value, less costs to sell, and had a net carrying amount of $4.7 million, which is made up of the outstanding balance of $13.1 million, net of a valuation allowance of $8.1 million and a participation of $937,000 at September 30, 2019. December 31, 2018 Level 1 Level 2 Level 3 Total Impaired loans 1 $ - $ - $ 12,163 $ 12,163 Other real estate owned, net 2 - - 7,175 7,175 Total $ - $ - $ 19,338 $ 19,338 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 $12.5 million and a valuation allowance of $352,000, resulting in an increase of specific allocations within the allowance for loan and lease losses of $208,000 for the year December 31, 2018. 2 OREO is measured at fair value, less costs to sell, and had a net carrying amount of $7.2 million, which is made up of the outstanding balance of $16.0 million, net of a valuation allowance of $8.0 million and a participation of $900,000, at December 31, 2018. |
Fair Values of Financial Inst_2
Fair Values of Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Fair Values of Financial Instruments | |
Schedule of carrying amount and estimated fair values of financial instruments | September 30, 2019 Carrying Fair Amount Value Level 1 Level 2 Level 3 Financial assets: Cash and due from banks $ 42,671 $ 42,671 $ 42,671 $ - $ - Interest bearing deposits with financial institutions 11,366 11,366 11,366 - - Securities available-for-sale 488,422 488,422 4,038 478,511 5,873 FHLBC and FRBC stock 10,711 10,711 - 10,711 - Loans held-for-sale 5,592 5,592 - 5,592 - Net loans 1,880,160 1,915,103 - - 1,915,103 Accrued interest receivable 9,854 9,854 - 9,854 - Financial liabilities: Noninterest bearing deposits $ 643,355 $ 643,355 $ 643,355 $ - $ - Interest bearing deposits 1,431,136 1,431,267 - 1,431,267 - Securities sold under repurchase agreements 48,870 48,870 - 48,870 - Other short-term borrowings 84,000 84,000 - 84,000 - Junior subordinated debentures 57,722 42,170 34,557 7,613 - Senior notes 44,244 46,269 46,269 - - Note payable and other borrowings 8,856 8,856 - 8,856 - Interest rate swap agreements 4,696 4,696 - 4,696 - Borrowing interest payable 744 744 - 744 - Deposit interest payable 950 950 - 950 - December 31, 2018 Carrying Fair Amount Value Level 1 Level 2 Level 3 Financial assets: Cash and due from banks $ 38,599 $ 38,599 $ 38,599 $ - $ - Interest bearing deposits with financial institutions 16,636 16,636 16,636 - - Securities available-for-sale 541,248 541,248 3,923 529,160 8,165 FHLBC and FRBC stock 13,433 13,433 - 13,433 - Loans held-for-sale 2,984 2,984 - 2,984 - Net loans 1,878,021 1,867,594 - - 1,867,594 Accrued interest receivable 10,940 10,940 - 10,940 - Financial liabilities: Noninterest bearing deposits $ 618,830 $ 618,830 $ 618,830 $ - $ - Interest bearing deposits 1,497,843 1,495,614 - 1,495,614 - Securities sold under repurchase agreements 46,632 46,632 - 46,632 - Other short-term borrowings 149,500 149,500 - 149,500 - Junior subordinated debentures 57,686 47,625 32,989 14,636 - Senior notes 44,158 45,008 45,008 - - Note payable and other borrowings 15,379 15,379 - 15,379 - Interest rate swap agreements 58 58 - 58 - Borrowing interest payable 281 281 - 281 - Deposit interest payable 973 973 - 973 - |
Financial Instruments with Off-
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions | |
Schedule of fair value of derivative financial instruments as well as their classification on the Balance Sheet | September 30, 2019 No. of Trans. Notional Amount $ Balance Sheet Location Fair Value $ Balance Sheet Location Fair Value $ Derivatives designated as hedging instruments Interest rate swaps 25,774 Other Assets - Other Liabilities 4,696 Total derivatives designated as hedging instruments - 4,696 Derivatives not designated as hedging instruments Interest rate swaps with commercial loan customers 174,531 Other Assets 3,756 Other Liabilities 3,756 Interest rate lock commitments and forward contracts 50,520 Other Assets 453 Other Liabilities - Other contracts 28,231 Other Assets - Other Liabilities 79 Total derivatives not designated as hedging instruments 4,209 3,835 December 31, 2018 No. of Trans. Notional Amount $ Balance Sheet Location Fair Value $ Balance Sheet Location Fair Value $ Derivatives designated as hedging instruments Interest rate swaps 25,774 Other Assets - Other Liabilities 58 Total derivatives designated as hedging instruments - 58 Derivatives not designated as hedging instruments Interest rate swaps with commercial loan customers 188,931 Other Assets 672 Other Liabilities 672 Interest rate lock commitments and forward contracts 18,130 Other Assets 159 Other Liabilities - Other contracts 18,155 Other Assets - Other Liabilities 26 Total derivatives not designated as hedging instruments 831 698 |
Schedule of financial instrument commitments | September 30, 2019 December 31, 2018 Fixed Variable Total Fixed Variable Total Letters of credit: Borrower: Financial standby $ 339 $ 7,418 $ 7,757 $ 327 $ 7,158 $ 7,485 Commercial standby - 354 354 - 397 397 Performance standby 571 6,312 6,883 532 6,381 6,913 910 14,084 14,994 859 13,936 14,795 Non-borrower: Performance standby - 67 67 - 67 67 Total letters of credit $ 910 $ 14,151 $ 15,061 $ 859 $ 14,003 $ 14,862 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Accounting Pronouncements (Details) - Accounting Standards Update 2016-02 - USD ($) | Sep. 30, 2019 | Jan. 01, 2019 |
Right of use assets, Operating | $ 3,300,000 | $ 817,000 |
Lessee lease liabiity, Operating | 3,300,000 | 817,000 |
Lease receivable, Lessor | 97,000 | 174,000 |
Lease liability, Lessor | $ 97,000 | $ 174,000 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Dividend (Details) - USD ($) | Nov. 04, 2019 | Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Oct. 15, 2019 | Jan. 16, 2019 |
Goodwill and Core Deposit Intangible | |||||||
Amortization of core deposit intangible | $ 157,000 | $ 136,000 | $ 410,000 | $ 254,000 | |||
Subsequent Events | |||||||
Exercise price of warrant | $ 13.43 | $ 13.43 | $ 14.23 | ||||
Subsequent Event | |||||||
Subsequent Events | |||||||
Dividends Payable, Amount Per Share | $ 0.01 | ||||||
Payments of Dividends | $ 299,000 |
Acquisitions (Details)
Acquisitions (Details) $ in Thousands | Apr. 20, 2018USD ($)item | Sep. 30, 2019USD ($) | Dec. 31, 2018USD ($) |
Business Acquisition [Line Items] | |||
Net cash paid | $ 47,180 | ||
Acquisition expenses | $ 3,500 | ||
Total liabilities | 289,769 | ||
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 | 13,280 | ||
Deferred tax assets, net | 3,459 | ||
Other assets | 1,767 | ||
Total assets | 336,949 | ||
Liabilities assumed: | |||
Deposits-noninterest bearing demand | 58,005 | ||
Deposits - Savings, NOW and money market | 91,494 | ||
Deposits-Time | 98,999 | ||
Total deposits | 248,498 | ||
Securities sold under repurchase agreements | 5,623 | ||
Other short-term borrowings | 10,875 | ||
Notes payable and other borrowings | 23,367 | ||
Other liabilities | 1,406 | ||
Total liabilities | 289,769 | ||
Cash consideration paid | 47,180 | ||
Total Liabilities Assumed and Cash Consideration Paid for Acquisition | $ 336,949 | ||
Salaries and Employee Benefits | |||
Business Acquisition [Line Items] | |||
Acquisition expenses | 1,100 | ||
Data Processing, Computer and ATM | |||
Business Acquisition [Line Items] | |||
Acquisition expenses | $ 1,800 | ||
GCFC/ABC Bank | |||
Business Acquisition [Line Items] | |||
Number of bank branches operated | item | 4 | ||
Acquisition price | $ 41,100 | ||
Subordinated debentures retired | 6,600 | ||
Goodwill | 10,200 | ||
Core deposit intangible | 3,100 | ||
Valuation adjustment, fixed assets | 1,500 | ||
Valuation adjustment, loan valuation mark | $ 11,200 | ||
Loans payable | $ 23,400 |
Acquisition of Loans (Details)
Acquisition of Loans (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Sep. 30, 2018 | Apr. 20, 2018 |
Business Acquisition [Line Items] | |||
Fair Value | $ 9,135 | $ 10,887 | |
PCI | GCFC/ABC Bank | |||
Business Acquisition [Line Items] | |||
Fair Value | 9,403 | $ 11,360 | |
Contractually required principal and interest payments | 15,083 | 19,447 | |
Best estimate of contractual cash flows not expected to be collected | 4,893 | 6,537 | |
Best estimate of contractual cash flows expected to be collected | 10,190 | 12,910 | |
Non-PCI | GCFC/ABC Bank | |||
Business Acquisition [Line Items] | |||
Fair Value | 134,536 | 216,234 | |
Contractually required principal and interest payments | 135,822 | 220,308 | |
Best estimate of contractual cash flows not expected to be collected | 614 | 2,511 | |
Best estimate of contractual cash flows expected to be collected | $ 135,208 | $ 217,797 |
Securities - Investment Portfol
Securities - Investment Portfolio (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Securities | |||||
Pretax realized losses on sale of available-for-sale securities | $ 378 | $ 10 | $ 956 | $ 10 | |
FHLB and FRB Stock | |||||
FHLBC stock | 4,500 | 4,500 | $ 7,200 | ||
FRB stock | $ 6,200 | $ 6,200 |
Securities - Amortized Cost and
Securities - Amortized Cost and Fair Value (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2019USD ($)item | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($)item | Sep. 30, 2018USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Securities Available-for-Sale | ||||||
Amortized Cost | $ 474,856 | $ 474,856 | $ 474,856 | $ 474,856 | $ 546,867 | |
Gross Unrealized Gains | 15,115 | 15,115 | 3,229 | |||
Gross Unrealized Losses | (1,549) | (1,549) | (8,848) | |||
Fair Value | 488,422 | 488,422 | 488,422 | 488,422 | 541,248 | |
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Acquired During Period, at Acquisition, at Fair Value | 9,135 | 10,887 | 9,135 | 10,887 | ||
Other disclosures | ||||||
Purchases | 136,096 | 71,488 | ||||
Sales | $ 57,228 | $ 1,917 | $ 177,824 | $ 94,663 | ||
Number of originators | item | 2 | 2 | ||||
Securities pledged to secure deposits and for other purposes | $ 328,800 | $ 328,800 | 311,200 | |||
US Treasury Securities [Member] | ||||||
Securities Available-for-Sale | ||||||
Amortized Cost | $ 4,009 | 4,006 | ||||
Gross Unrealized Gains | 29 | |||||
Gross Unrealized Losses | (83) | |||||
Fair Value | 4,038 | 3,923 | ||||
US Government Corporations and Agencies Securities [Member] | ||||||
Securities Available-for-Sale | ||||||
Amortized Cost | 9,304 | 11,112 | ||||
Gross Unrealized Losses | (161) | (161) | ||||
Fair Value | 9,143 | 10,951 | ||||
U.S. government agencies mortgage-backed | ||||||
Securities Available-for-Sale | ||||||
Amortized Cost | 14,407 | |||||
Gross Unrealized Gains | 45 | |||||
Gross Unrealized Losses | (377) | |||||
Fair Value | 14,075 | |||||
US States and Political Subdivisions Debt Securities [Member] | ||||||
Securities Available-for-Sale | ||||||
Amortized Cost | 227,680 | 227,680 | 277,112 | |||
Gross Unrealized Gains | 11,962 | 11,962 | 1,916 | |||
Gross Unrealized Losses | (915) | (915) | (4,961) | |||
Fair Value | 238,727 | 238,727 | 274,067 | |||
Collateralized Mortgage Obligations [Member] | ||||||
Securities Available-for-Sale | ||||||
Amortized Cost | 62,965 | 62,965 | 66,494 | |||
Gross Unrealized Gains | 1,216 | 1,216 | 79 | |||
Gross Unrealized Losses | (60) | (60) | (2,144) | |||
Fair Value | 64,121 | 64,121 | 64,429 | |||
Asset-backed Securities [Member] | ||||||
Securities Available-for-Sale | ||||||
Amortized Cost | 82,106 | 82,106 | 108,574 | |||
Gross Unrealized Gains | 1,243 | 1,243 | 1,165 | |||
Gross Unrealized Losses | (167) | (167) | (225) | |||
Fair Value | 83,182 | 83,182 | 109,514 | |||
FFEL | ||||||
Other disclosures | ||||||
Asset-backed securities | 55,700 | $ 55,700 | ||||
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 | 4,700 | $ 4,700 | ||||
Percentage of total added credit enhancement in the form of overcollaterization and/or subordination of outstanding principal | 8.30 | |||||
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 | 72,454 | $ 72,454 | 65,162 | |||
Gross Unrealized Gains | 46 | 46 | 24 | |||
Gross Unrealized Losses | (229) | (229) | (897) | |||
Fair Value | 72,271 | 72,271 | $ 64,289 | |||
Mortgage Backed Securities, Issued by US Government Agencies [Member] | ||||||
Securities Available-for-Sale | ||||||
Amortized Cost | 16,338 | |||||
Gross Unrealized Gains | 619 | |||||
Gross Unrealized Losses | (17) | |||||
Fair Value | $ 16,940 | |||||
GCO Education Loan Funding Corp [Member] | ||||||
Securities Available-for-Sale | ||||||
Amortized Cost | 27,840 | 27,840 | ||||
Fair Value | 27,744 | 27,744 | ||||
Towd Point Mortgage Trust | ||||||
Securities Available-for-Sale | ||||||
Amortized Cost | 33,744 | 33,744 | ||||
Fair Value | $ 34,378 | $ 34,378 | ||||
Towd Point Mortgage Trust | Stockholders' Equity, Total [Member] | ||||||
Other disclosures | ||||||
Credit risk as a percentage of benchmark | 10.00% | |||||
Stockholders' Equity, Total [Member] | GCO Education Loan Funding Corp [Member] | ||||||
Other disclosures | ||||||
Credit risk as a percentage of benchmark | 10.00% |
Securities - Contractural Matur
Securities - Contractural Maturities (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2019 | Dec. 31, 2018 | |
Securities Available-for-Sale, Amortized Cost | |||
Due in one year or less | $ 736 | ||
Due after one year through five years | 4,655 | ||
Due after five years through ten years | 4,645 | ||
Due after ten years | 230,957 | ||
Debt securities excluding securities not due at a single maturity date | 240,993 | ||
Total | $ 474,856 | $ 474,856 | $ 546,867 |
Securities Available-for-Sale, Weighted Average Yield | |||
Due in one year or less (as a percent) | 1.92% | ||
Due after one year through five years (as a percent) | 1.88% | ||
Due after five years through ten years (as a percent) | 3.29% | ||
Due after ten years (as a percent) | 3.04% | ||
Debt securities (as a percent) | 3.02% | ||
Total (as a percent) | 3.31% | ||
Securities Available-for-Sale, Fair Value | |||
Due in one year or less | $ 736 | ||
Due after one year through five years | 4,687 | ||
Due after five years through ten years | 4,944 | ||
Due after ten years | 241,541 | ||
Debt securities | 251,908 | ||
Fair Value | 488,422 | 488,422 | 541,248 |
Collateralized Mortgage Obligations [Member] | |||
Securities Available-for-Sale, Amortized Cost | |||
Total | 62,965 | 66,494 | |
Securities Available-for-Sale, Fair Value | |||
Fair Value | 64,121 | 64,429 | |
Asset-backed Securities [Member] | |||
Securities Available-for-Sale, Amortized Cost | |||
Securities not due at a single maturity date | $ 82,106 | ||
Total | 82,106 | 108,574 | |
Securities Available-for-Sale, Weighted Average Yield | |||
Securities not due at a single maturity date, Weighted Average Yield (as a percent) | 3.27% | ||
Securities Available-for-Sale, Fair Value | |||
Securities not due at a single maturity date | $ 83,182 | ||
Fair Value | 83,182 | 109,514 | |
Collateralized loan obligations | |||
Securities Available-for-Sale, Amortized Cost | |||
Securities not due at a single maturity date | $ 72,454 | ||
Total | 72,454 | 65,162 | |
Securities Available-for-Sale, Weighted Average Yield | |||
Securities not due at a single maturity date, Weighted Average Yield (as a percent) | 4.53% | ||
Securities Available-for-Sale, Fair Value | |||
Securities not due at a single maturity date | $ 72,271 | ||
Fair Value | $ 72,271 | $ 64,289 | |
Mortgage-backed and collateralized mortgage obligations | |||
Securities Available-for-Sale, Amortized Cost | |||
Securities not due at a single maturity date | $ 79,303 | ||
Securities Available-for-Sale, Weighted Average Yield | |||
Securities not due at a single maturity date, Weighted Average Yield (as a percent) | 3.15% | ||
Securities Available-for-Sale, Fair Value | |||
Securities not due at a single maturity date | $ 81,061 |
Securities - Unrealized Loss Po
Securities - Unrealized Loss Positions (Details) | Sep. 30, 2019USD ($)security | Dec. 31, 2018USD ($)security |
Securities Available-for-Sale, Number of Securities | ||
Less than 12 months in an unrealized loss position | security | 15 | 16 |
Greater than 12 months in an unrealized loss position | security | 16 | 61 |
Total | 31 | 77 |
Securities Available-for-Sale, Unrealized Losses | ||
Less than 12 months in an unrealized loss position | $ 534,000 | $ 1,256,000 |
Greater than 12 months in an unrealized loss position | 1,015,000 | 7,592,000 |
Total | 1,549,000 | 8,848,000 |
Securities Available-for-Sale, Fair Value | ||
Less than 12 months in an unrealized loss position | 84,211,000 | 86,856,000 |
Greater than 12 months in an unrealized loss position | 47,323,000 | 197,238,000 |
Total | $ 131,534,000 | $ 284,094,000 |
US Treasury Securities [Member] | ||
Securities Available-for-Sale, Number of Securities | ||
Greater than 12 months in an unrealized loss position | security | 1 | |
Total | 1 | |
Securities Available-for-Sale, Unrealized Losses | ||
Greater than 12 months in an unrealized loss position | $ 83,000 | |
Total | 83,000 | |
Securities Available-for-Sale, Fair Value | ||
Greater than 12 months in an unrealized loss position | 3,923,000 | |
Total | $ 3,923,000 | |
US Government Corporations and Agencies Securities [Member] | ||
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 | 4 | 1 |
Total | 4 | 4 |
Securities Available-for-Sale, Unrealized Losses | ||
Less than 12 months in an unrealized loss position | $ 100,000 | |
Greater than 12 months in an unrealized loss position | $ 161,000 | 61,000 |
Total | 161,000 | 161,000 |
Securities Available-for-Sale, Fair Value | ||
Less than 12 months in an unrealized loss position | 7,385,000 | |
Greater than 12 months in an unrealized loss position | 9,143,000 | 3,566,000 |
Total | $ 9,143,000 | $ 10,951,000 |
Mortgage Backed Securities, Issued by US Government Agencies [Member] | ||
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 | 2 | 11 |
Total | 5 | 11 |
Securities Available-for-Sale, Unrealized Losses | ||
Less than 12 months in an unrealized loss position | $ 7,000 | |
Greater than 12 months in an unrealized loss position | 10,000 | $ 377,000 |
Total | 17,000 | 377,000 |
Securities Available-for-Sale, Fair Value | ||
Less than 12 months in an unrealized loss position | 3,044,000 | |
Greater than 12 months in an unrealized loss position | 848,000 | 11,439,000 |
Total | $ 3,892,000 | $ 11,439,000 |
US States and Political Subdivisions Debt Securities [Member] | ||
Securities Available-for-Sale, Number of Securities | ||
Less than 12 months in an unrealized loss position | security | 3 | 4 |
Greater than 12 months in an unrealized loss position | security | 2 | 33 |
Total | 5 | 37 |
Securities Available-for-Sale, Unrealized Losses | ||
Less than 12 months in an unrealized loss position | $ 326,000 | $ 126,000 |
Greater than 12 months in an unrealized loss position | 589,000 | 4,835,000 |
Total | 915,000 | 4,961,000 |
Securities Available-for-Sale, Fair Value | ||
Less than 12 months in an unrealized loss position | 15,526,000 | 17,713,000 |
Greater than 12 months in an unrealized loss position | 6,757,000 | 110,326,000 |
Total | $ 22,283,000 | $ 128,039,000 |
Collateralized Mortgage Obligations [Member] | ||
Securities Available-for-Sale, Number of Securities | ||
Less than 12 months in an unrealized loss position | security | 2 | 2 |
Greater than 12 months in an unrealized loss position | security | 3 | 10 |
Total | 5 | 12 |
Securities Available-for-Sale, Unrealized Losses | ||
Less than 12 months in an unrealized loss position | $ 44,000 | $ 309,000 |
Greater than 12 months in an unrealized loss position | 16,000 | 1,835,000 |
Total | 60,000 | 2,144,000 |
Securities Available-for-Sale, Fair Value | ||
Less than 12 months in an unrealized loss position | 9,320,000 | 15,211,000 |
Greater than 12 months in an unrealized loss position | 2,332,000 | 43,687,000 |
Total | $ 11,652,000 | $ 58,898,000 |
Asset-backed Securities [Member] | ||
Securities Available-for-Sale, Number of Securities | ||
Less than 12 months in an unrealized loss position | security | 2 | |
Greater than 12 months in an unrealized loss position | security | 1 | 4 |
Total | 3 | 4 |
Securities Available-for-Sale, Unrealized Losses | ||
Less than 12 months in an unrealized loss position | $ 101,000 | |
Greater than 12 months in an unrealized loss position | 66,000 | $ 225,000 |
Total | 167,000 | 225,000 |
Securities Available-for-Sale, Fair Value | ||
Less than 12 months in an unrealized loss position | 29,389,000 | |
Greater than 12 months in an unrealized loss position | 3,213,000 | 16,473,000 |
Total | $ 32,602,000 | $ 16,473,000 |
Collateralized loan obligations | ||
Securities Available-for-Sale, Number of Securities | ||
Less than 12 months in an unrealized loss position | security | 5 | 7 |
Greater than 12 months in an unrealized loss position | security | 4 | 1 |
Total | 9 | 8 |
Securities Available-for-Sale, Unrealized Losses | ||
Less than 12 months in an unrealized loss position | $ 56,000 | $ 721,000 |
Greater than 12 months in an unrealized loss position | 173,000 | 176,000 |
Total | 229,000 | 897,000 |
Securities Available-for-Sale, Fair Value | ||
Less than 12 months in an unrealized loss position | 26,932,000 | 46,547,000 |
Greater than 12 months in an unrealized loss position | 25,030,000 | 7,824,000 |
Total | $ 51,962,000 | $ 54,371,000 |
Securities - Realized Gain (Los
Securities - Realized Gain (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Securities | |||||
Sales | $ 57,228 | $ 1,917 | $ 177,824 | $ 94,663 | |
Gross realized gains on securities | 3,841 | 23 | 5,432 | 370 | |
Gross realized losses on securities | (378) | (10) | (956) | (10) | |
Securities (losses) gains, net | 3,463 | 13 | 4,476 | 360 | |
Related tax (expense) benefit | $ (973) | $ (3) | $ (1,257) | $ (100) | |
Effective tax rate applied (as a percent) | 28.10% | 23.10% | 28.10% | 27.80% | |
Available-for-sale Securities Pledged as Collateral | $ 328,800 | $ 328,800 | $ 311,200 |
Loans - Major Classifications (
Loans - Major Classifications (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 | Sep. 30, 2018 |
Loans | |||
Total loans, gross | $ 1,888,622 | $ 1,884,409 | |
Net deferred loan fees | 2,054 | 1,653 | |
PCI loans, net of purchase accounting adjustments | 1,899,811 | 1,897,027 | $ 1,834,949 |
Total Loans | 1,899,811 | ||
Other Financing Receivable [Member] | |||
Loans | |||
Total loans, gross | 14,140 | 14,439 | |
PCI | |||
Loans | |||
PCI loans, net of purchase accounting adjustments | 9,135 | 10,965 | |
Non-PCI | |||
Loans | |||
PCI loans, net of purchase accounting adjustments | 1,890,676 | 1,886,062 | |
Commercial Portfolio Segment [Member] | |||
Loans | |||
Total loans, gross | 333,664 | 314,323 | |
PCI loans, net of purchase accounting adjustments | 333,664 | 314,323 | |
Commercial Real Estate Portfolio Segment [Member] | |||
Loans | |||
Total loans, gross | 826,780 | 820,941 | |
PCI loans, net of purchase accounting adjustments | 808,310 | ||
Total Loans | 830,713 | ||
Commercial Real Estate Portfolio Segment [Member] | Construction Loans | |||
Loans | |||
Total loans, gross | 91,066 | 108,390 | |
PCI loans, net of purchase accounting adjustments | 113,651 | ||
Total Loans | 91,703 | ||
Residential Portfolio Segment [Member] | |||
Loans | |||
Total loans, gross | 388,511 | 407,068 | |
PCI loans, net of purchase accounting adjustments | 399,581 | ||
Total Loans | 393,076 | ||
Residential Portfolio Segment [Member] | Home Equity Line of Credit | |||
Loans | |||
PCI loans, net of purchase accounting adjustments | 126,309 | 140,442 | |
Consumer Portfolio Segment [Member] | |||
Loans | |||
PCI loans, net of purchase accounting adjustments | 122,022 | ||
Total Loans | 126,309 | ||
Consumer Portfolio Segment [Member] | Home Equity Line of Credit | |||
Loans | |||
Total loans, gross | 126,309 | 140,442 | |
Finance Leases Financing Receivable [Member] | |||
Loans | |||
Total loans, gross | 108,152 | 78,806 | |
PCI loans, net of purchase accounting adjustments | $ 108,152 | $ 78,806 | $ 70,661 |
Loans - Major Classifications -
Loans - Major Classifications - Loan Concentrations (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Jun. 30, 2018 | Sep. 30, 2019 | Apr. 20, 2018 | |
Loans | |||
Loans | $ 227,594 | ||
Real Estate Portfolio Segment [Member] | Loan receivables | Customer Concentration Risk [Member] | |||
Loans | |||
Credit risk as a percentage of benchmark | 77.90% | ||
Loans receivable as a percentage of total portfolio | 75.40% |
Loans - Aging Analysis (Details
Loans - Aging Analysis (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 | Sep. 30, 2018 |
Aged analysis of past due loans | |||
Total Past Due | $ 7,955 | $ 13,358 | |
Current | 1,878,208 | 1,867,663 | |
Nonaccrual | 13,648 | 16,006 | |
Total Loans | 1,899,811 | 1,897,027 | $ 1,834,949 |
Total Loans | 1,899,811 | ||
Recorded Investment 90 days or Greater Past Due and Accruing | 19 | 935 | |
30 to 59 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 5,732 | 10,617 | |
60 to 89 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 2,205 | 1,824 | |
90 Days or Greater Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 18 | 917 | |
PCI | |||
Aged analysis of past due loans | |||
Total Past Due | 865 | 1,452 | |
Current | 6,474 | 7,248 | |
Nonaccrual | 1,796 | 2,265 | |
Total Loans | 9,135 | 10,965 | |
PCI | 30 to 59 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 865 | 1,452 | |
Non-PCI | |||
Aged analysis of past due loans | |||
Total Past Due | 7,090 | 11,906 | |
Current | 1,871,734 | 1,860,415 | |
Nonaccrual | 11,852 | 13,741 | |
Total Loans | 1,890,676 | 1,886,062 | |
Recorded Investment 90 days or Greater Past Due and Accruing | 19 | 935 | |
Non-PCI | 30 to 59 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 4,867 | 9,165 | |
Non-PCI | 60 to 89 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 2,205 | 1,824 | |
Non-PCI | 90 Days or Greater Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 18 | 917 | |
Multifamily | |||
Aged analysis of past due loans | |||
Total Past Due | 1 | 724 | |
Current | 183,475 | 195,504 | |
Total Loans | 183,476 | 196,228 | |
Recorded Investment 90 days or Greater Past Due and Accruing | 180 | ||
Multifamily | 30 to 59 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 1 | 545 | |
Multifamily | 90 Days or Greater Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 179 | ||
Commercial Portfolio Segment [Member] | |||
Aged analysis of past due loans | |||
Total Past Due | 410 | ||
Current | 333,516 | 313,913 | |
Nonaccrual | 148 | ||
Total Loans | 333,664 | 314,323 | |
Recorded Investment 90 days or Greater Past Due and Accruing | 361 | ||
Commercial Portfolio Segment [Member] | 30 to 59 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 58 | ||
Commercial Portfolio Segment [Member] | 90 Days or Greater Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 352 | ||
Finance Leases Financing Receivable [Member] | |||
Aged analysis of past due loans | |||
Current | 108,078 | 78,806 | |
Nonaccrual | 74 | ||
Total Loans | 108,152 | 78,806 | 70,661 |
Commercial Real Estate Portfolio Segment [Member] | |||
Aged analysis of past due loans | |||
Total Loans | 808,310 | ||
Total Loans | 830,713 | ||
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Owner Occupied General Purpose Loan [Member] | |||
Aged analysis of past due loans | |||
Total Past Due | 2,613 | 1,801 | |
Current | 140,928 | 160,892 | |
Nonaccrual | 1,183 | 1,579 | |
Total Loans | 144,724 | 164,272 | |
Recorded Investment 90 days or Greater Past Due and Accruing | 36 | ||
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Owner Occupied General Purpose Loan [Member] | 30 to 59 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 1,397 | 1,768 | |
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Owner Occupied General Purpose Loan [Member] | 60 to 89 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 1,216 | ||
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Owner Occupied General Purpose Loan [Member] | 90 Days or Greater Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 33 | ||
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate Owner Occupied Special Purpose Loan [Member] | |||
Aged analysis of past due loans | |||
Total Past Due | 1,509 | 961 | |
Current | 173,835 | 192,426 | |
Nonaccrual | 1,591 | 395 | |
Total Loans | 176,935 | 193,782 | |
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate Owner Occupied Special Purpose Loan [Member] | 30 to 59 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 1,416 | 826 | |
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate Owner Occupied Special Purpose Loan [Member] | 60 to 89 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 93 | 135 | |
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Non Owner Occupied General Purpose Loan [Member] | |||
Aged analysis of past due loans | |||
Total Past Due | 623 | 3,035 | |
Current | 328,870 | 286,115 | |
Nonaccrual | 564 | 4,236 | |
Total Loans | 330,057 | 293,386 | |
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Non Owner Occupied General Purpose Loan [Member] | 30 to 59 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 623 | 2,832 | |
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Non Owner Occupied General Purpose Loan [Member] | 60 to 89 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 203 | ||
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Non Owner Occupied Special Purpose Loan [Member] | |||
Aged analysis of past due loans | |||
Current | 106,043 | 106,036 | |
Nonaccrual | 2,960 | 3,099 | |
Total Loans | 109,003 | 109,135 | |
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Retail Properties Loan [Member] | |||
Aged analysis of past due loans | |||
Total Past Due | 597 | 620 | |
Current | 51,015 | 45,968 | |
Nonaccrual | 1,122 | ||
Total Loans | 52,734 | 46,588 | |
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Retail Properties Loan [Member] | 30 to 59 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 597 | ||
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Retail Properties Loan [Member] | 60 to 89 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 620 | ||
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Farm Loan [Member] | |||
Aged analysis of past due loans | |||
Current | 13,327 | 13,778 | |
Total Loans | 13,327 | 13,778 | |
Commercial Real Estate Portfolio Segment [Member] | Construction Loans | |||
Aged analysis of past due loans | |||
Total Loans | 113,651 | ||
Total Loans | 91,703 | ||
Commercial Real Estate Portfolio Segment [Member] | Construction Loans | Construction Real Estate, Homebuilder Loan [Member] | |||
Aged analysis of past due loans | |||
Total Past Due | 93 | ||
Current | 5,142 | 5,102 | |
Total Loans | 5,235 | 5,102 | |
Commercial Real Estate Portfolio Segment [Member] | Construction Loans | Construction Real Estate, Homebuilder Loan [Member] | 30 to 59 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 93 | ||
Commercial Real Estate Portfolio Segment [Member] | Construction Loans | Construction Real Estate, Land Loan [Member] | |||
Aged analysis of past due loans | |||
Total Past Due | 266 | ||
Current | 12,258 | 2,478 | |
Total Loans | 12,258 | 2,744 | |
Commercial Real Estate Portfolio Segment [Member] | Construction Loans | Construction Real Estate, Land Loan [Member] | 30 to 59 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 266 | ||
Commercial Real Estate Portfolio Segment [Member] | Construction Loans | Construction Real Estate, Commercial Speculative Loan [Member] | |||
Aged analysis of past due loans | |||
Total Past Due | 350 | ||
Current | 51,991 | 55,060 | |
Total Loans | 51,991 | 55,410 | |
Recorded Investment 90 days or Greater Past Due and Accruing | 355 | ||
Commercial Real Estate Portfolio Segment [Member] | Construction Loans | Construction Real Estate, Commercial Speculative Loan [Member] | 90 Days or Greater Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 350 | ||
Commercial Real Estate Portfolio Segment [Member] | Construction Loans | Construction Real Estate, Other Receivable [Member] | |||
Aged analysis of past due loans | |||
Current | 21,488 | 45,028 | |
Nonaccrual | 94 | 106 | |
Total Loans | 21,582 | 45,134 | |
Residential Portfolio Segment [Member] | |||
Aged analysis of past due loans | |||
Total Loans | 399,581 | ||
Total Loans | 393,076 | ||
Residential Portfolio Segment [Member] | Residential Investor Loan [Member] | |||
Aged analysis of past due loans | |||
Total Past Due | 496 | 957 | |
Current | 68,114 | 69,148 | |
Nonaccrual | 379 | 353 | |
Total Loans | 68,989 | 70,458 | |
Residential Portfolio Segment [Member] | Residential Investor Loan [Member] | 30 to 59 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 801 | ||
Residential Portfolio Segment [Member] | Residential Investor Loan [Member] | 60 to 89 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 496 | 156 | |
Residential Portfolio Segment [Member] | Residential Owner Occupied Loan [Member] | |||
Aged analysis of past due loans | |||
Total Past Due | 413 | 1,946 | |
Current | 132,933 | 135,360 | |
Nonaccrual | 2,700 | 3,076 | |
Total Loans | 136,046 | 140,382 | |
Residential Portfolio Segment [Member] | Residential Owner Occupied Loan [Member] | 30 to 59 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 106 | 1,241 | |
Residential Portfolio Segment [Member] | Residential Owner Occupied Loan [Member] | 60 to 89 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 307 | 705 | |
Residential Portfolio Segment [Member] | Home Equity Line of Credit | |||
Aged analysis of past due loans | |||
Total Past Due | 738 | 775 | |
Current | 124,556 | 138,801 | |
Nonaccrual | 1,015 | 866 | |
Total Loans | 126,309 | 140,442 | |
Recorded Investment 90 days or Greater Past Due and Accruing | 19 | ||
Residential Portfolio Segment [Member] | Home Equity Line of Credit | 30 to 59 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 627 | 775 | |
Residential Portfolio Segment [Member] | Home Equity Line of Credit | 60 to 89 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 93 | ||
Residential Portfolio Segment [Member] | Home Equity Line of Credit | 90 Days or Greater Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 18 | ||
Consumer Portfolio Segment [Member] | |||
Aged analysis of past due loans | |||
Total Loans | 122,022 | ||
Total Loans | 126,309 | ||
Unallocated Financing Receivables [Member] | |||
Aged analysis of past due loans | |||
Total Past Due | 7 | 61 | |
Current | 16,165 | 16,000 | |
Nonaccrual | 22 | 31 | |
Total Loans | 16,194 | 16,092 | $ 14,317 |
Total Loans | 16,194 | ||
Recorded Investment 90 days or Greater Past Due and Accruing | 3 | ||
Unallocated Financing Receivables [Member] | 30 to 59 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | $ 7 | 53 | |
Unallocated Financing Receivables [Member] | 60 to 89 Days Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | 5 | ||
Unallocated Financing Receivables [Member] | 90 Days or Greater Past Due | |||
Aged analysis of past due loans | |||
Total Past Due | $ 3 |
Loans - Inclusion (Details)
Loans - Inclusion (Details) | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Minimum [Member] | |
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, 2019 | Dec. 31, 2018 | Sep. 30, 2018 |
Loans by risk rating | |||
Total Loans | $ 1,899,811 | $ 1,897,027 | $ 1,834,949 |
PCI loans, net of purchase accounting adjustments | 9,135 | 10,887 | |
Total Loans | 1,899,811 | ||
Multifamily | |||
Loans by risk rating | |||
Total Loans | 183,476 | 196,228 | |
Commercial Portfolio Segment [Member] | |||
Loans by risk rating | |||
Total Loans | 333,664 | 314,323 | |
Finance Leases Financing Receivable [Member] | |||
Loans by risk rating | |||
Total Loans | 108,152 | 78,806 | 70,661 |
Commercial Real Estate Portfolio Segment [Member] | |||
Loans by risk rating | |||
Total Loans | 808,310 | ||
PCI loans, net of purchase accounting adjustments | 3,933 | 4,126 | |
Total Loans | 830,713 | ||
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Owner Occupied General Purpose Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 144,724 | 164,272 | |
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate Owner Occupied Special Purpose Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 176,935 | 193,782 | |
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Non Owner Occupied General Purpose Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 330,057 | 293,386 | |
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Non Owner Occupied Special Purpose Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 109,003 | 109,135 | |
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Retail Properties Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 52,734 | 46,588 | |
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Farm Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 13,327 | 13,778 | |
Residential Portfolio Segment [Member] | |||
Loans by risk rating | |||
Total Loans | 399,581 | ||
PCI loans, net of purchase accounting adjustments | 4,565 | 5,983 | |
Total Loans | 393,076 | ||
Residential Portfolio Segment [Member] | Residential Investor Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 68,989 | 70,458 | |
Residential Portfolio Segment [Member] | Residential Owner Occupied Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 136,046 | 140,382 | |
Consumer Portfolio Segment [Member] | |||
Loans by risk rating | |||
Total Loans | 122,022 | ||
Total Loans | 126,309 | ||
Unallocated Financing Receivables [Member] | |||
Loans by risk rating | |||
Total Loans | 16,194 | 16,092 | 14,317 |
Total Loans | 16,194 | ||
Pass [Member] | |||
Loans by risk rating | |||
Total Loans | 1,844,569 | 1,835,457 | |
Pass [Member] | Multifamily | |||
Loans by risk rating | |||
Total Loans | 183,046 | 195,249 | |
Pass [Member] | Commercial Portfolio Segment [Member] | |||
Loans by risk rating | |||
Total Loans | 316,680 | 305,993 | |
Pass [Member] | Finance Leases Financing Receivable [Member] | |||
Loans by risk rating | |||
Total Loans | 108,078 | 78,806 | |
Pass [Member] | Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Owner Occupied General Purpose Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 140,867 | 157,334 | |
Pass [Member] | Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate Owner Occupied Special Purpose Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 170,525 | 186,218 | |
Pass [Member] | Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Non Owner Occupied General Purpose Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 325,621 | 284,818 | |
Pass [Member] | Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Non Owner Occupied Special Purpose Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 106,043 | 104,526 | |
Pass [Member] | Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Retail Properties Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 51,015 | 44,805 | |
Pass [Member] | Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Farm Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 10,899 | 11,307 | |
Pass [Member] | Residential Portfolio Segment [Member] | Residential Investor Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 68,005 | 69,242 | |
Pass [Member] | Residential Portfolio Segment [Member] | Residential Owner Occupied Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 132,146 | 135,858 | |
Pass [Member] | Unallocated Financing Receivables [Member] | |||
Loans by risk rating | |||
Total Loans | 15,832 | 16,061 | |
Special Mention [Member] | |||
Loans by risk rating | |||
Total Loans | 17,593 | 19,149 | |
Special Mention [Member] | Commercial Portfolio Segment [Member] | |||
Loans by risk rating | |||
Total Loans | 8,905 | 8,193 | |
Special Mention [Member] | Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Owner Occupied General Purpose Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 851 | 1,660 | |
Special Mention [Member] | Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate Owner Occupied Special Purpose Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 4,819 | 3,429 | |
Special Mention [Member] | Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Non Owner Occupied General Purpose Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 590 | 202 | |
Special Mention [Member] | Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Non Owner Occupied Special Purpose Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 1,510 | ||
Special Mention [Member] | Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Retail Properties Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 597 | ||
Special Mention [Member] | Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Farm Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 1,218 | 1,249 | |
Special Mention [Member] | Residential Portfolio Segment [Member] | Residential Owner Occupied Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 134 | ||
Special Mention [Member] | Unallocated Financing Receivables [Member] | |||
Loans by risk rating | |||
Total Loans | 340 | ||
Substandard [Member] | |||
Loans by risk rating | |||
Total Loans | 37,649 | 42,421 | |
Substandard [Member] | Multifamily | |||
Loans by risk rating | |||
Total Loans | 430 | 979 | |
Substandard [Member] | Commercial Portfolio Segment [Member] | |||
Loans by risk rating | |||
Total Loans | 8,079 | 137 | |
Substandard [Member] | Finance Leases Financing Receivable [Member] | |||
Loans by risk rating | |||
Total Loans | 74 | ||
Substandard [Member] | Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Owner Occupied General Purpose Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 3,006 | 5,278 | |
Substandard [Member] | Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate Owner Occupied Special Purpose Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 1,591 | 4,135 | |
Substandard [Member] | Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Non Owner Occupied General Purpose Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 3,846 | 8,366 | |
Substandard [Member] | Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Non Owner Occupied Special Purpose Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 2,960 | 3,099 | |
Substandard [Member] | Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Retail Properties Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 1,122 | 1,783 | |
Substandard [Member] | Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Farm Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 1,210 | 1,222 | |
Substandard [Member] | Residential Portfolio Segment [Member] | Residential Investor Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 984 | 1,216 | |
Substandard [Member] | Residential Portfolio Segment [Member] | Residential Owner Occupied Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 3,766 | 4,524 | |
Substandard [Member] | Unallocated Financing Receivables [Member] | |||
Loans by risk rating | |||
Total Loans | 22 | 31 | |
PCI | |||
Loans by risk rating | |||
Total Loans | 9,135 | 10,965 | |
PCI | Pass [Member] | |||
Loans by risk rating | |||
Total Loans | 825 | 907 | |
PCI | Special Mention [Member] | |||
Loans by risk rating | |||
Total Loans | 2,906 | ||
PCI | Substandard [Member] | |||
Loans by risk rating | |||
Total Loans | 8,310 | 7,152 | |
Non-PCI | |||
Loans by risk rating | |||
Total Loans | 1,890,676 | 1,886,062 | |
Non-PCI | Pass [Member] | |||
Loans by risk rating | |||
Total Loans | 1,843,744 | 1,834,550 | |
Non-PCI | Special Mention [Member] | |||
Loans by risk rating | |||
Total Loans | 17,593 | 16,243 | |
Non-PCI | Substandard [Member] | |||
Loans by risk rating | |||
Total Loans | 29,339 | 35,269 | |
Construction Loans | Commercial Real Estate Portfolio Segment [Member] | |||
Loans by risk rating | |||
Total Loans | 113,651 | ||
PCI loans, net of purchase accounting adjustments | 637 | $ 778 | |
Total Loans | 91,703 | ||
Construction Loans | Commercial Real Estate Portfolio Segment [Member] | Construction Real Estate, Homebuilder Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 5,235 | 5,102 | |
Construction Loans | Commercial Real Estate Portfolio Segment [Member] | Construction Real Estate, Land Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 12,258 | 2,744 | |
Construction Loans | Commercial Real Estate Portfolio Segment [Member] | Construction Real Estate, Commercial Speculative Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 51,991 | 55,410 | |
Construction Loans | Commercial Real Estate Portfolio Segment [Member] | Construction Real Estate, Other Receivable [Member] | |||
Loans by risk rating | |||
Total Loans | 21,582 | 45,134 | |
Construction Loans | Pass [Member] | Commercial Real Estate Portfolio Segment [Member] | Construction Real Estate, Homebuilder Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 5,235 | 5,102 | |
Construction Loans | Pass [Member] | Commercial Real Estate Portfolio Segment [Member] | Construction Real Estate, Land Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 12,258 | 2,744 | |
Construction Loans | Pass [Member] | Commercial Real Estate Portfolio Segment [Member] | Construction Real Estate, Commercial Speculative Loan [Member] | |||
Loans by risk rating | |||
Total Loans | 51,991 | 55,410 | |
Construction Loans | Pass [Member] | Commercial Real Estate Portfolio Segment [Member] | Construction Real Estate, Other Receivable [Member] | |||
Loans by risk rating | |||
Total Loans | 21,318 | 42,524 | |
Construction Loans | Substandard [Member] | Commercial Real Estate Portfolio Segment [Member] | Construction Real Estate, Other Receivable [Member] | |||
Loans by risk rating | |||
Total Loans | 264 | 2,610 | |
Home Equity Line of Credit | Residential Portfolio Segment [Member] | |||
Loans by risk rating | |||
Total Loans | 126,309 | 140,442 | |
Home Equity Line of Credit | Pass [Member] | Residential Portfolio Segment [Member] | |||
Loans by risk rating | |||
Total Loans | 124,185 | 138,553 | |
Home Equity Line of Credit | Special Mention [Member] | Residential Portfolio Segment [Member] | |||
Loans by risk rating | |||
Total Loans | 139 | ||
Home Equity Line of Credit | Substandard [Member] | Residential Portfolio Segment [Member] | |||
Loans by risk rating | |||
Total Loans | $ 1,985 | $ 1,889 |
Loans - Repossessed Assets (Det
Loans - Repossessed Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Repossessed and foreclosed assets | ||
Other real estate owned | $ 4,682 | $ 7,175 |
Residential Portfolio Segment [Member] | ||
Repossessed and foreclosed assets | ||
Mortgage loans in process of foreclosure | $ 425,000,000 | $ 448,000,000 |
Loans - Impaired Loans - Record
Loans - Impaired Loans - Recorded Investment, Unpaid Principal Balance and Related Allowance (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Recorded Investment | ||
With no related allowance recorded | $ 12,133 | $ 7,844 |
With an allowance recorded | 5,776 | 12,515 |
Total impaired loans | 17,909 | 20,359 |
Unpaid Principal Balance | ||
With no related allowance recorded | 15,117 | 9,895 |
With an allowance recorded | 5,780 | 13,936 |
Total impaired loans | 20,897 | 23,831 |
Related Allowance | ||
With an allowance recorded | 274 | 352 |
Commercial Portfolio Segment [Member] | ||
Recorded Investment | ||
With an allowance recorded | 148 | |
Unpaid Principal Balance | ||
With an allowance recorded | 150 | |
Related Allowance | ||
With an allowance recorded | 110 | |
Finance Leases Financing Receivable [Member] | ||
Recorded Investment | ||
With no related allowance recorded | 74 | |
Unpaid Principal Balance | ||
With no related allowance recorded | 75 | |
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Owner Occupied General Purpose Loan [Member] | ||
Recorded Investment | ||
With no related allowance recorded | 1,254 | 1,659 |
With an allowance recorded | 125 | 396 |
Unpaid Principal Balance | ||
With no related allowance recorded | 1,328 | 1,782 |
With an allowance recorded | 125 | 396 |
Related Allowance | ||
With an allowance recorded | 36 | 3 |
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate Owner Occupied Special Purpose Loan [Member] | ||
Recorded Investment | ||
With no related allowance recorded | 1,591 | 395 |
Unpaid Principal Balance | ||
With no related allowance recorded | 1,748 | 530 |
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Non Owner Occupied General Purpose Loan [Member] | ||
Recorded Investment | ||
With no related allowance recorded | 564 | 1,138 |
With an allowance recorded | 55 | 3,098 |
Unpaid Principal Balance | ||
With no related allowance recorded | 595 | 1,159 |
With an allowance recorded | 55 | 4,038 |
Related Allowance | ||
With an allowance recorded | 1 | 97 |
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Non Owner Occupied Special Purpose Loan [Member] | ||
Recorded Investment | ||
With no related allowance recorded | 2,960 | |
With an allowance recorded | 3,099 | |
Unpaid Principal Balance | ||
With no related allowance recorded | 3,575 | |
With an allowance recorded | 3,575 | |
Related Allowance | ||
With an allowance recorded | 139 | |
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Retail Properties Loan [Member] | ||
Recorded Investment | ||
With no related allowance recorded | 1,122 | |
Unpaid Principal Balance | ||
With no related allowance recorded | 1,159 | |
Residential Portfolio Segment [Member] | Residential Investor Loan [Member] | ||
Recorded Investment | ||
With no related allowance recorded | 379 | 353 |
With an allowance recorded | 791 | 808 |
Unpaid Principal Balance | ||
With no related allowance recorded | 500 | 459 |
With an allowance recorded | 791 | 808 |
Related Allowance | ||
With an allowance recorded | 10 | 4 |
Residential Portfolio Segment [Member] | Residential Owner Occupied Loan [Member] | ||
Recorded Investment | ||
With no related allowance recorded | 3,059 | 3,359 |
With an allowance recorded | 3,280 | 3,676 |
Unpaid Principal Balance | ||
With no related allowance recorded | 4,595 | 4,882 |
With an allowance recorded | 3,280 | 3,679 |
Related Allowance | ||
With an allowance recorded | 55 | 46 |
Residential Portfolio Segment [Member] | Residential Revolving and Junior Liens Loan [Member] | ||
Recorded Investment | ||
With no related allowance recorded | 1,032 | 884 |
With an allowance recorded | 1,359 | 1,357 |
Unpaid Principal Balance | ||
With no related allowance recorded | 1,407 | 1,003 |
With an allowance recorded | 1,359 | 1,357 |
Related Allowance | ||
With an allowance recorded | 55 | 49 |
Consumer Portfolio Segment [Member] | ||
Recorded Investment | ||
With no related allowance recorded | 4 | 7 |
With an allowance recorded | 18 | 24 |
Unpaid Principal Balance | ||
With no related allowance recorded | 4 | 7 |
With an allowance recorded | 20 | 25 |
Related Allowance | ||
With an allowance recorded | 7 | 13 |
Construction Loans | Commercial Real Estate Portfolio Segment [Member] | Construction Real Estate, Other Receivable [Member] | ||
Recorded Investment | ||
With no related allowance recorded | 94 | 49 |
With an allowance recorded | 57 | |
Unpaid Principal Balance | ||
With no related allowance recorded | $ 131 | 73 |
With an allowance recorded | 58 | |
Related Allowance | ||
With an allowance recorded | $ 1 |
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, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Average Recorded Investment | ||||
With no related allowance recorded | $ 11,488 | $ 7,012 | $ 9,989 | $ 10,340 |
With an allowance recorded | 6,161 | 9,263 | 9,145 | 7,450 |
Total impaired loans | 17,649 | 16,275 | 19,134 | 17,790 |
Interest Income Recognized | ||||
With no related allowance recorded | 13 | 13 | 38 | 35 |
With an allowance recorded | 75 | 85 | 226 | 204 |
Total impaired loans | 88 | 98 | 264 | 239 |
Commercial Portfolio Segment [Member] | ||||
Average Recorded Investment | ||||
With an allowance recorded | 149 | 74 | ||
Finance Leases Financing Receivable [Member] | ||||
Average Recorded Investment | ||||
With no related allowance recorded | 43 | 37 | ||
With an allowance recorded | 57 | |||
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Owner Occupied General Purpose Loan [Member] | ||||
Average Recorded Investment | ||||
With no related allowance recorded | 1,108 | 1,263 | 1,457 | 1,035 |
With an allowance recorded | 395 | 259 | 260 | 259 |
Interest Income Recognized | ||||
With no related allowance recorded | 2 | 2 | 5 | 5 |
With an allowance recorded | 3 | 22 | 11 | 22 |
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate Owner Occupied Special Purpose Loan [Member] | ||||
Average Recorded Investment | ||||
With no related allowance recorded | 1,045 | 417 | 993 | 375 |
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Non Owner Occupied General Purpose Loan [Member] | ||||
Average Recorded Investment | ||||
With no related allowance recorded | 566 | 91 | 851 | 653 |
With an allowance recorded | 55 | 1,577 | ||
Interest Income Recognized | ||||
With an allowance recorded | 2 | 4 | ||
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Non Owner Occupied Special Purpose Loan [Member] | ||||
Average Recorded Investment | ||||
With no related allowance recorded | 2,960 | 1,480 | ||
With an allowance recorded | 3,099 | 1,549 | ||
Interest Income Recognized | ||||
With an allowance recorded | 1,550 | |||
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Retail Properties Loan [Member] | ||||
Average Recorded Investment | ||||
With no related allowance recorded | 1,130 | 561 | ||
Residential Portfolio Segment [Member] | Residential Investor Loan [Member] | ||||
Average Recorded Investment | ||||
With no related allowance recorded | 381 | 368 | 366 | 369 |
With an allowance recorded | 795 | 812 | 799 | 820 |
Interest Income Recognized | ||||
With an allowance recorded | 13 | 11 | 35 | 33 |
Residential Portfolio Segment [Member] | Multifamily | ||||
Average Recorded Investment | ||||
With no related allowance recorded | 2,361 | |||
Residential Portfolio Segment [Member] | Residential Owner Occupied Loan [Member] | ||||
Average Recorded Investment | ||||
With no related allowance recorded | 3,078 | 4,050 | 3,209 | 4,532 |
With an allowance recorded | 3,321 | 3,678 | 3,478 | 3,576 |
Interest Income Recognized | ||||
With no related allowance recorded | 11 | 11 | 32 | 29 |
With an allowance recorded | 37 | 35 | 117 | 108 |
Residential Portfolio Segment [Member] | Residential Revolving and Junior Liens Loan [Member] | ||||
Average Recorded Investment | ||||
With no related allowance recorded | 1,075 | 687 | 958 | 880 |
With an allowance recorded | 1,370 | 1,371 | 1,358 | 1,203 |
Interest Income Recognized | ||||
With no related allowance recorded | 1 | 1 | ||
With an allowance recorded | 20 | 17 | 59 | 41 |
Consumer Portfolio Segment [Member] | ||||
Average Recorded Investment | ||||
With no related allowance recorded | 4 | 15 | 6 | 10 |
With an allowance recorded | 19 | 14 | 21 | 13 |
Construction Loans | Commercial Real Estate Portfolio Segment [Member] | Construction Real Estate, Other Receivable [Member] | ||||
Average Recorded Investment | ||||
With no related allowance recorded | $ 98 | 121 | 71 | 125 |
With an allowance recorded | $ 30 | $ 29 | $ 29 |
Loans - TDR (Details)
Loans - TDR (Details) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019USD ($)contract | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($)contract | Sep. 30, 2018USD ($)contract | Dec. 31, 2018USD ($) | |
Troubled debt restructurings - modified during the period | |||||
# of contracts | 6 | 17 | |||
Pre-modification recorded investment | $ 1,159,000 | $ 791,000 | $ 1,694,000 | $ 1,600,000 | |
Post-modification recorded investment | 1,122,000 | $ 782,000 | 1,546,000 | 1,473,000 | |
TDR's defaulted | |||||
Pre-modification outstanding recorded investment during the period | 0 | $ 0 | |||
Other information | |||||
Total Past Due | 7,955,000 | 7,955,000 | $ 13,358,000 | ||
Others [Member] | |||||
Troubled debt restructurings - modified during the period | |||||
# of contracts | 1 | 1 | |||
Pre-modification recorded investment | $ 34,000 | $ 34,000 | |||
Post-modification recorded investment | $ 29,000 | $ 29,000 | |||
Home Affordable Modification Program [Member] | |||||
Troubled debt restructurings - modified during the period | |||||
# of contracts | 1 | 1 | |||
Pre-modification recorded investment | $ 26,000 | $ 26,000 | |||
Post-modification recorded investment | $ 26,000 | $ 26,000 | |||
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate Owner Occupied Special Purpose Loan [Member] | |||||
Other information | |||||
Total Past Due | 1,509,000 | 1,509,000 | 961,000 | ||
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate Owner Occupied Special Purpose Loan [Member] | Others [Member] | |||||
Troubled debt restructurings - modified during the period | |||||
# of contracts | contract | 1 | ||||
Pre-modification recorded investment | $ 110,000 | ||||
Post-modification recorded investment | $ 52,000 | ||||
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Owner Occupied General Purpose Loan [Member] | |||||
Other information | |||||
Total Past Due | 2,613,000 | $ 2,613,000 | 1,801,000 | ||
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Owner Occupied General Purpose Loan [Member] | Others [Member] | |||||
Troubled debt restructurings - modified during the period | |||||
# of contracts | 1 | 1 | 1 | ||
Pre-modification recorded investment | $ 427,000 | $ 58,000 | $ 427,000 | ||
Post-modification recorded investment | $ 424,000 | 55,000 | $ 424,000 | ||
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Non Owner Occupied General Purpose Loan [Member] | |||||
Other information | |||||
Total Past Due | $ 623,000 | $ 623,000 | 3,035,000 | ||
Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Non Owner Occupied General Purpose Loan [Member] | Others [Member] | |||||
Troubled debt restructurings - modified during the period | |||||
# of contracts | contract | 1 | 1 | |||
Pre-modification recorded investment | $ 1,159,000 | $ 1,159,000 | |||
Post-modification recorded investment | 1,122,000 | 1,122,000 | |||
Commercial Real Estate Portfolio Segment [Member] | Construction Loans | Construction Real Estate, Commercial Speculative Loan [Member] | |||||
Other information | |||||
Total Past Due | 350,000 | ||||
Residential Portfolio Segment [Member] | Residential Investor Loan [Member] | |||||
Other information | |||||
Total Past Due | 496,000 | 496,000 | 957,000 | ||
Residential Portfolio Segment [Member] | Residential Owner Occupied Loan [Member] | |||||
Other information | |||||
Total Past Due | 413,000 | $ 413,000 | 1,946,000 | ||
Residential Portfolio Segment [Member] | Residential Owner Occupied Loan [Member] | Home Affordable Modification Program [Member] | |||||
Troubled debt restructurings - modified during the period | |||||
# of contracts | 1 | 3 | 3 | ||
Pre-modification recorded investment | $ 211,000 | $ 399,000 | $ 383,000 | ||
Post-modification recorded investment | $ 211,000 | 297,000 | $ 331,000 | ||
Residential Portfolio Segment [Member] | Home Equity Line of Credit | |||||
Other information | |||||
Total Past Due | 738,000 | $ 738,000 | 775,000 | ||
Residential Portfolio Segment [Member] | Home Equity Line of Credit | Others [Member] | |||||
Troubled debt restructurings - modified during the period | |||||
# of contracts | contract | 1 | ||||
Pre-modification recorded investment | $ 39,000 | ||||
Post-modification recorded investment | $ 38,000 | ||||
Residential Portfolio Segment [Member] | Home Equity Line of Credit | Home Affordable Modification Program [Member] | |||||
Troubled debt restructurings - modified during the period | |||||
# of contracts | contract | 1 | ||||
Pre-modification recorded investment | $ 39,000 | ||||
Post-modification recorded investment | 34,000 | ||||
Residential Portfolio Segment [Member] | Home Equity Line of Credit | Residential Owner Occupied Loan [Member] | Others [Member] | |||||
Troubled debt restructurings - modified during the period | |||||
# of contracts | 2 | 9 | |||
Pre-modification recorded investment | $ 93,000 | $ 596,000 | |||
Post-modification recorded investment | $ 92,000 | $ 587,000 | |||
Residential Portfolio Segment [Member] | Home Equity Line of Credit | Residential Owner Occupied Loan [Member] | 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 | ||||
Commercial Portfolio Segment [Member] | |||||
Other information | |||||
Total Past Due | 410,000 | ||||
90 Days or Greater Past Due | |||||
Other information | |||||
Total Past Due | 18,000 | 18,000 | 917,000 | ||
90 Days or Greater Past Due | Commercial Real Estate Portfolio Segment [Member] | Commercial Real Estate, Owner Occupied General Purpose Loan [Member] | |||||
Other information | |||||
Total Past Due | 33,000 | ||||
90 Days or Greater Past Due | Commercial Real Estate Portfolio Segment [Member] | Construction Loans | Construction Real Estate, Commercial Speculative Loan [Member] | |||||
Other information | |||||
Total Past Due | 350,000 | ||||
90 Days or Greater Past Due | Residential Portfolio Segment [Member] | Home Equity Line of Credit | |||||
Other information | |||||
Total Past Due | $ 18,000 | $ 18,000 | |||
90 Days or Greater Past Due | Commercial Portfolio Segment [Member] | |||||
Other information | |||||
Total Past Due | $ 352,000 |
Loans - Accretable Discount on
Loans - Accretable Discount on Purchased Loans (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Accretable discount | $ 10,771 | $ 835 | ||
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward] | ||||
Beginning balance | 10,771 | 835 | ||
Beginning balance | $ 7,647 | $ 8,935 | ||
Purchases | 11,269 | |||
Accretion | (1,041) | (775) | (1,814) | (1,973) |
Charge-offs | (515) | |||
Transfers | (399) | (534) | ||
Ending balance | 9,597 | 9,597 | ||
Ending balance | 6,606 | 6,606 | ||
PCI | ||||
Accretable discount | 931 | 1,373 | 1,099 | 1,218 |
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward] | ||||
Beginning balance | 931 | 1,373 | 1,099 | |
Beginning balance | 5,500 | 6,403 | 5,969 | |
Purchases | 1,551 | |||
Purchases | 6,536 | |||
Accretion | (218) | (129) | (340) | (305) |
Accretion | (606) | (334) | (606) | (334) |
Charge-offs | (48) | |||
Charge-offs | (467) | |||
Transfers | (1) | (26) | (3) | (28) |
Transfers | (1) | (3) | (133) | |
Ending balance | 714 | 1,218 | 714 | 1,218 |
Ending balance | 4,893 | 6,069 | 4,893 | 6,069 |
Non-PCI | ||||
Accretable discount | 1,216 | 2,995 | 1,867 | 835 |
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward] | ||||
Beginning balance | 1,216 | 2,995 | 1,867 | 835 |
Purchases | 3,182 | |||
Accretion | (217) | (312) | (868) | (1,334) |
Transfers | (373) | (373) | ||
Ending balance | $ 999 | $ 2,310 | $ 999 | $ 2,310 |
Allowance for Loan Losses (Deta
Allowance for Loan Losses (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Allowance for loan losses: | |||||
Beginning Balance | $ 19,372 | $ 19,321 | $ 19,006 | $ 17,461 | |
Charge-offs | 397 | 372 | 1,216 | 1,046 | |
Recoveries | 126 | 379 | 411 | 2,185 | |
Provision (release) | 550 | 1,450 | 728 | ||
Ending Balance | 19,651 | 19,328 | 19,651 | 19,328 | |
Ending balance: Individually evaluated for impairment | 274 | 373 | 274 | 373 | |
Ending balance: Collectively evaluated for impairment | 18,805 | 18,955 | 18,805 | 18,955 | |
Ending balance: Acquired and accounted for ASC 310-30 | 572 | 572 | |||
Loans: | |||||
Ending balance | 1,899,811 | 1,834,949 | 1,899,811 | 1,834,949 | $ 1,897,027 |
Ending balance | 1,899,811 | 1,899,811 | |||
Ending balance: Individually evaluated for impairment | 17,909 | 16,725 | 17,909 | 16,725 | |
Ending balance: Collectively evaluated for impairment | 1,872,767 | 1,807,337 | 1,872,767 | 1,807,337 | |
Ending balance: Acquired and accounted for ASC 310-30 | 9,135 | 10,887 | 9,135 | 10,887 | |
Commercial Portfolio Segment [Member] | |||||
Loans: | |||||
Ending balance | 333,664 | 333,664 | 314,323 | ||
Commercial without Leases | |||||
Allowance for loan losses: | |||||
Beginning Balance | 3,377 | 2,676 | 2,832 | 2,453 | |
Charge-offs | 20 | 7 | 99 | 38 | |
Recoveries | 10 | 32 | 46 | 141 | |
Provision (release) | (49) | 96 | 539 | 241 | |
Ending Balance | 3,318 | 2,797 | 3,318 | 2,797 | |
Ending balance: Individually evaluated for impairment | 110 | 110 | |||
Ending balance: Collectively evaluated for impairment | 3,208 | 2,797 | 3,208 | 2,797 | |
Loans: | |||||
Ending balance | 306,407 | 306,407 | |||
Ending balance | 333,664 | 333,664 | |||
Ending balance: Individually evaluated for impairment | 148 | 148 | |||
Ending balance: Collectively evaluated for impairment | 333,516 | 306,407 | 333,516 | 306,407 | |
Commercial leases | |||||
Allowance for loan losses: | |||||
Beginning Balance | 961 | 734 | |||
Charge-offs | 47 | 47 | |||
Provision (release) | 66 | 293 | |||
Ending Balance | 980 | 980 | |||
Ending balance: Collectively evaluated for impairment | 980 | 980 | |||
Loans: | |||||
Ending balance | 108,152 | 108,152 | |||
Ending balance: Individually evaluated for impairment | 74 | 74 | |||
Ending balance: Collectively evaluated for impairment | 108,078 | 108,078 | |||
Finance Leases Financing Receivable [Member] | |||||
Allowance for loan losses: | |||||
Beginning Balance | 634 | 692 | |||
Charge-offs | 13 | ||||
Provision (release) | 31 | (14) | |||
Ending Balance | 665 | 665 | |||
Ending balance: Collectively evaluated for impairment | 665 | 665 | |||
Loans: | |||||
Ending balance | 108,152 | 70,661 | 108,152 | 70,661 | 78,806 |
Ending balance: Collectively evaluated for impairment | 70,661 | 70,661 | |||
Commercial Real Estate Portfolio Segment [Member] | |||||
Allowance for loan losses: | |||||
Beginning Balance | 10,517 | 10,537 | 10,470 | 9,522 | |
Charge-offs | 159 | 201 | 432 | 609 | |
Recoveries | 12 | 37 | 47 | 425 | |
Provision (release) | (88) | (144) | 197 | 891 | |
Ending Balance | 10,282 | 10,229 | 10,282 | 10,229 | |
Ending balance: Individually evaluated for impairment | 37 | 185 | 37 | 185 | |
Ending balance: Collectively evaluated for impairment | 9,690 | 10,044 | 9,690 | 10,044 | |
Ending balance: Acquired and accounted for ASC 310-30 | 555 | 555 | |||
Loans: | |||||
Ending balance | 808,310 | 808,310 | |||
Ending balance | 830,713 | 830,713 | |||
Ending balance: Individually evaluated for impairment | 7,671 | 5,782 | 7,671 | 5,782 | |
Ending balance: Collectively evaluated for impairment | 819,109 | 798,402 | 819,109 | 798,402 | |
Ending balance: Acquired and accounted for ASC 310-30 | 3,933 | 4,126 | 3,933 | 4,126 | |
Residential Portfolio Segment [Member] | |||||
Allowance for loan losses: | |||||
Beginning Balance | 1,790 | 1,818 | 1,931 | 1,846 | |
Charge-offs | 3 | 21 | (55) | ||
Recoveries | 22 | 83 | 86 | 1,099 | |
Provision (release) | 56 | 67 | (131) | (1,032) | |
Ending Balance | 1,865 | 1,968 | 1,865 | 1,968 | |
Ending balance: Individually evaluated for impairment | 65 | 59 | 65 | 59 | |
Ending balance: Collectively evaluated for impairment | 1,800 | 1,909 | 1,800 | 1,909 | |
Loans: | |||||
Ending balance | 399,581 | 399,581 | |||
Ending balance | 393,076 | 393,076 | |||
Ending balance: Individually evaluated for impairment | 7,509 | 8,740 | 7,509 | 8,740 | |
Ending balance: Collectively evaluated for impairment | 381,002 | 384,858 | 381,002 | 384,858 | |
Ending balance: Acquired and accounted for ASC 310-30 | 4,565 | 5,983 | 4,565 | 5,983 | |
Consumer Portfolio Segment [Member] | |||||
Allowance for loan losses: | |||||
Beginning Balance | 1,335 | 1,390 | 1,449 | 1,446 | |
Charge-offs | 19 | 49 | 298 | 141 | |
Recoveries | 21 | 139 | 79 | 277 | |
Provision (release) | (74) | (372) | 33 | (474) | |
Ending Balance | 1,263 | 1,108 | 1,263 | 1,108 | |
Ending balance: Individually evaluated for impairment | 55 | 61 | 55 | 61 | |
Ending balance: Collectively evaluated for impairment | 1,208 | 1,047 | 1,208 | 1,047 | |
Loans: | |||||
Ending balance | 122,022 | 122,022 | |||
Ending balance | 126,309 | 126,309 | |||
Ending balance: Individually evaluated for impairment | 2,391 | 2,054 | 2,391 | 2,054 | |
Ending balance: Collectively evaluated for impairment | 123,918 | 119,968 | 123,918 | 119,968 | |
Unallocated Financing Receivables [Member] | |||||
Allowance for loan losses: | |||||
Beginning Balance | 572 | 868 | 621 | 579 | |
Charge-offs | 142 | 115 | 311 | 316 | |
Recoveries | 61 | 56 | 152 | 208 | |
Provision (release) | 646 | 696 | 675 | 1,034 | |
Ending Balance | 1,137 | 1,505 | 1,137 | 1,505 | |
Ending balance: Individually evaluated for impairment | 7 | 26 | 7 | 26 | |
Ending balance: Collectively evaluated for impairment | 1,113 | 1,479 | 1,113 | 1,479 | |
Ending balance: Acquired and accounted for ASC 310-30 | 17 | 17 | |||
Loans: | |||||
Ending balance | 16,194 | 14,317 | 16,194 | 14,317 | $ 16,092 |
Ending balance | 16,194 | 16,194 | |||
Ending balance: Individually evaluated for impairment | 22 | 40 | 22 | 40 | |
Ending balance: Collectively evaluated for impairment | 16,172 | 14,277 | 16,172 | 14,277 | |
Construction Loans | Commercial Real Estate Portfolio Segment [Member] | |||||
Allowance for loan losses: | |||||
Beginning Balance | 820 | 1,398 | 969 | 923 | |
Charge-offs | 7 | 8 | (16) | ||
Recoveries | 32 | 35 | |||
Recoveries, net | 1 | ||||
Provision (release) | (7) | (374) | (156) | 82 | |
Ending Balance | 806 | 1,056 | 806 | 1,056 | |
Ending balance: Individually evaluated for impairment | 42 | 42 | |||
Ending balance: Collectively evaluated for impairment | 806 | 1,014 | 806 | 1,014 | |
Loans: | |||||
Ending balance | 113,651 | 113,651 | |||
Ending balance | 91,703 | 91,703 | |||
Ending balance: Individually evaluated for impairment | 94 | 109 | 94 | 109 | |
Ending balance: Collectively evaluated for impairment | 90,972 | 112,764 | 90,972 | 112,764 | |
Ending balance: Acquired and accounted for ASC 310-30 | $ 637 | $ 778 | $ 637 | $ 778 |
Other Real Estate Owned (Detail
Other Real Estate Owned (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Activity in the other real estate owned (OREO) portfolio, net of valuation reserve | ||||
Balance at beginning of period | $ 7,175 | |||
Balance at end of period | $ 4,682 | 4,682 | ||
Activity in the valuation allowance | ||||
Provision for unrealized losses | 203 | $ 119 | 399 | $ 485 |
Expenses related to foreclosed assets, net of lease revenue | ||||
Gain on sales, net | (104) | (612) | (254) | (716) |
Provision for unrealized losses | 203 | 119 | 399 | 485 |
Operating expenses | (73) | 133 | ||
Less: Lease revenue | 10 | |||
Expenses related to OREO, net of lease revenue | 26 | (370) | ||
Real Estate, Other | ||||
Activity in the other real estate owned (OREO) portfolio, net of valuation reserve | ||||
Balance at beginning of period | 5,668 | 8,912 | 7,175 | 8,371 |
Property additions, net of acquisition adjustments | 305 | (217) | 305 | 2,595 |
Property improvements | 59 | |||
Less: Property disposals, net of gains/losses | 1,088 | 1,612 | 2,390 | 3,576 |
Less: Period valuation adjustments | 203 | 119 | 399 | 485 |
Less: Other adjustments | 9 | |||
Balance at end of period | 4,682 | 6,964 | 4,682 | 6,964 |
Activity in the valuation allowance | ||||
Balance at beginning of period | 8,061 | 8,348 | 8,027 | 8,208 |
Provision for unrealized losses | 203 | 119 | 399 | 485 |
Reductions taken on sales | (798) | (456) | (960) | (682) |
Balance at end of period | 7,466 | 8,011 | 7,466 | 8,011 |
Expenses related to foreclosed assets, net of lease revenue | ||||
Gain on sales, net | (254) | (716) | ||
Provision for unrealized losses | $ 203 | $ 119 | 399 | 485 |
Operating expenses | 184 | 502 | ||
Less: Lease revenue | 5 | 39 | ||
Expenses related to OREO, net of lease revenue | $ 324 | $ 232 |
Deposits - Components and Matur
Deposits - Components and Maturities (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Deposits | ||
Noninterest bearing demand | $ 643,355 | $ 618,830 |
Savings | 304,726 | 304,400 |
NOW accounts | 413,291 | 425,878 |
Money market accounts | 286,484 | 310,390 |
Certificates of deposit of less than $100,000 | 222,378 | 230,781 |
Certificates of deposit of $100,000 up to $250,000 | 142,669 | 159,953 |
Certificates of deposit of $250,000 or more | 61,588 | 66,441 |
Total deposits | $ 2,074,491 | $ 2,116,673 |
Borrowings - Summary (Details)
Borrowings - Summary (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Borrowings | ||
Senior Notes | $ 44,244 | $ 44,158 |
Total borrowings | 243,692 | 313,355 |
Securities Sold under Agreements to Repurchase [Member] | ||
Borrowings | ||
Total borrowings | 48,870 | 46,632 |
Federal Home Loan Bank Advances [Member] | ||
Borrowings | ||
Total borrowings | 84,000 | 149,500 |
Junior Subordinated Debt [Member] | ||
Borrowings | ||
Total borrowings | 57,722 | 57,686 |
Senior Notes. | ||
Borrowings | ||
Senior Notes | 44,244 | 44,158 |
Notes Payable to Banks [Member] | ||
Borrowings | ||
Total borrowings | $ 8,856 | $ 15,379 |
Borrowings - Additional informa
Borrowings - Additional information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Dec. 31, 2016 | Sep. 30, 2019 | Dec. 31, 2018 | Apr. 20, 2018 | |
Borrowings | ||||
Interest rate (as a percent) | 5.75% | |||
Bank owned FHLBC stock | $ 4,500,000 | $ 7,200,000 | ||
Senior notes | 44,244,000 | 44,158,000 | ||
Debt Instrument, Term | 10 years | |||
Interest rate term | 5 years | |||
Total borrowings | 243,692,000 | 313,355,000 | ||
GCFC/ABC Bank | ||||
Borrowings | ||||
FHLBC advance amount | $ 8,900,000 | |||
Subordinated Debt. | $ 6,600,000 | |||
Debt Instrument, Term | 7 years | |||
Debt assumed | $ 23,400,000 | |||
GCFC/ABC Bank | Minimum [Member] | ||||
Borrowings | ||||
Interest rate (as a percent) | 2.19% | |||
GCFC/ABC Bank | Maximum [Member] | ||||
Borrowings | ||||
Interest rate (as a percent) | 2.83% | |||
Debt Instrument, Variable Rate Base LIBOR [Member] | ||||
Borrowings | ||||
Basis points added to reference rate (as a percent) | 385.00% | |||
Securities Sold under Agreements to Repurchase [Member] | ||||
Borrowings | ||||
Carrying amount of securities secured | $ 48,900,000 | 46,600,000 | ||
Fair value of the pledged collateral | 62,400,000 | 72,800,000 | ||
Total borrowings | $ 48,870,000 | 46,632,000 | ||
Securities Sold under Agreements to Repurchase [Member] | Minimum [Member] | ||||
Borrowings | ||||
Threshold percentage of stockholders' equity | 10.00% | |||
Federal Home Loan Bank Advances [Member] | ||||
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 | $ 84,000,000 | 145,500,000 | ||
Bank owned FHLBC stock | 4,500,000 | |||
Fair value of securities collateralized | 54,900,000 | |||
Principal balance of loans collateralized | 610,300,000 | |||
Combined collateral value | $ 464,100,000 | |||
Percentage increase in collateral pledged in support of federal home loan bank advances | 367.40% | |||
Amount available for additional borrowings | $ 277,000,000 | |||
Total borrowings | $ 84,000,000 | 149,500,000 | ||
FHLB advances at 2.02% | ||||
Borrowings | ||||
Interest rate (as a percent) | 2.02% | |||
FHLBC advance amount | $ 65,000,000 | |||
FHLB advances at 2.04% | ||||
Borrowings | ||||
FHLBC advance amount | 10,000,000 | |||
FHLB advances at 1.76% to 2.23% | ||||
Borrowings | ||||
FHLBC advance amount | $ 8,900,000 | |||
FHLB advances at 1.76% to 2.23% | Minimum [Member] | ||||
Borrowings | ||||
Interest rate (as a percent) | 1.76% | |||
FHLB advances at 1.76% to 2.23% | Maximum [Member] | ||||
Borrowings | ||||
Interest rate (as a percent) | 2.23% | |||
Notes Payable to Banks [Member] | ||||
Borrowings | ||||
Total borrowings | $ 8,856,000 | 15,379,000 | ||
Credit Facility [Member] | ||||
Borrowings | ||||
Maximum borrowing capacity | $ 20,000,000 | |||
Debt Instrument, Term | 360 days | |||
Short-term debt | $ 4,000,000 | |||
Junior Subordinated Debt [Member] | ||||
Borrowings | ||||
Total borrowings | 57,722,000 | 57,686,000 | ||
Senior Notes. | ||||
Borrowings | ||||
Senior notes | 44,244,000 | 44,158,000 | ||
Debt issuance costs | $ 756,000 | $ 842,000 | ||
Amortization period for deferred financing costs | 10 years |
Junior Subordinated Debentures
Junior Subordinated Debentures - Issuance (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Apr. 30, 2007 | Jul. 31, 2003 | Jun. 30, 2003 | Sep. 30, 2019 | Dec. 31, 2018 |
Junior subordinated debentures | ||||||
Junior subordinated debentures | $ 57,722 | $ 57,722 | $ 57,686 | |||
Old Second Capital Trust I [Member] | ||||||
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 [Member] | ||||||
Junior subordinated debentures | ||||||
Proceeds from sale of cumulative trust preferred securities | $ 25,000 | |||||
Maturity Period | 30 years | |||||
Old Second Capital Trust II [Member] | Debt Instrument, Redemption, Period One [Member] | ||||||
Junior subordinated debentures | ||||||
Cash distribution rate of trust preferred securities (as a percent) | 4.40% | |||||
Cash distribution fixed rate of trust preferred securities (as a percent) | 6.77% | |||||
Old Second Capital Trust II [Member] | 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 [Member] | Debt Instrument, Redemption, Period Two [Member] | Debt Instrument, Variable Rate Base LIBOR [Member] | ||||||
Junior subordinated debentures | ||||||
Cash distribution, floating rate base | three-month LIBOR | |||||
Junior Subordinated Debt [Member] | ||||||
Junior subordinated debentures | ||||||
Junior Subordinated Debentures issuance cost | $ 657 | $ 657 | $ 692 | |||
Junior Subordinated Debt [Member] | Old Second Capital Trust I [Member] | ||||||
Junior subordinated debentures | ||||||
Junior subordinated debentures | 32,600 | 32,600 | ||||
Junior Subordinated Debt [Member] | Old Second Capital Trust II [Member] | ||||||
Junior subordinated debentures | ||||||
Junior subordinated debentures | $ 25,800 | $ 25,800 |
Equity Compensation Plans - Opt
Equity Compensation Plans - Options (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Equity Compensation Plans | ||||
Total compensation cost | $ 1.9 | $ 1.7 | ||
Exercised (in shares) | 4,500 | |||
Shares | ||||
Exercised (in shares) | (4,500) | |||
Aggregate Intrinsic Value | ||||
Exercised (in dollars) | $ (27,000) | |||
2014 Plan | ||||
Equity Compensation Plans | ||||
Number of shares authorized | 600,000 | 600,000 | ||
Employee and Nonemployee Stock Options [Member] | ||||
Equity Compensation Plans | ||||
Granted (in shares) | 0 | |||
Term of stock options granted | 10 years | |||
Exercised (in shares) | 4,500 | |||
Total unrecognized compensation cost | $ 0 | $ 0 | ||
Shares | ||||
Beginning outstanding (in shares) | 4,500 | |||
Exercised (in shares) | (4,500) | |||
Ending outstanding (in shares) | 4,500 | |||
Weighted Average Exercise Price | ||||
Beginning outstanding (in dollars per share) | $ 7.49 | |||
Exercised (in dollars per share) | $ 7.49 | |||
Ending outstanding (in dollars per share) | $ 7.49 | |||
Weighted Average Remaining Contractual Term (years) | ||||
Ending outstanding (in years) | 0 years | 1 month 6 days | ||
Aggregate Intrinsic Value | ||||
Ending outstanding (in dollars) | $ 25,000 | |||
Restricted Stock and Restricted Stock Units [Member] | ||||
Equity Compensation Plans | ||||
Vesting period | 3 years |
Equity Compensation Plans - Sum
Equity Compensation Plans - Summary of stock option activity (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2019 | Sep. 30, 2018 | |
Summary Of Stock Option Activity [Abstract] | |||
Intrinsic value of options exercised | $ 27 | ||
Cash received from options exercised | $ 32 | ||
Stock based compensation | $ 1,905 | $ 1,641 | |
2014 Plan | |||
Summary Of Stock Option Activity [Abstract] | |||
Number of shares authorized | 600,000 | 600,000 | |
Number of shares issuable | 433,894 | 433,894 |
Equity Compensation Plans - Res
Equity Compensation Plans - Restricted Stock and RSUs (Details) - Restricted Stock and Restricted Stock Units [Member] - USD ($) $ / shares in Units, $ in Millions | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Changes in unvested awards | ||
Nonvested at the beginning of the period (in shares) | 552,281 | |
Granted (in shares) | 166,106 | 254,281 |
Vested (in shares) | (123,937) | |
Nonvested at the end of the period (in shares) | 594,450 | |
Weighted Average Grant Date Fair Value | ||
Nonvested at the beginning of the period (in dollars per share) | $ 11.30 | |
Granted (in dollars per share) | 12.77 | |
Vested (in dollars per share) | 7.43 | |
Nonvested at the end of the period (in dollars per share) | $ 12.52 | |
Additional information | ||
Total unrecognized compensation cost of restricted awards | $ 3.6 | |
Expected weighted-average period for recognition of unrecognized compensation | 1 year 11 months 19 days |
Earnings Per Share - Reconcilia
Earnings Per Share - Reconciliation (Details) - USD ($) | Jan. 16, 2019 | Sep. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2016 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2009 | Mar. 31, 2019 | Jan. 16, 2009 |
Basic earnings per share: | |||||||||||
Weighted-average common shares outstanding | 29,899,063 | 29,747,078 | 29,880,511 | 29,718,191 | |||||||
Net income | $ 12,173,000 | $ 9,642,000 | $ 29,919,000 | $ 25,392,000 | |||||||
Basic earnings per share (in dollars per share) | $ 0.41 | $ 0.32 | $ 1 | $ 0.85 | |||||||
Diluted earnings per share: | |||||||||||
Weighted-average common shares outstanding | 29,899,063 | 29,747,078 | 29,880,511 | 29,718,191 | |||||||
Diluted average common shares outstanding | 30,438,333 | 30,383,891 | 30,390,965 | 30,297,294 | |||||||
Net earnings available to common stockholders | $ 12,173,000 | $ 9,642,000 | $ 29,919,000 | $ 25,392,000 | |||||||
Diluted earnings per share (in dollars per share) | $ 0.40 | $ 0.32 | $ 0.98 | $ 0.84 | |||||||
Warrants, exercise price (in dollars per share) | $ 14.23 | $ 13.43 | $ 13.43 | ||||||||
Warrant term | 10 years | ||||||||||
Stock warrants exercised | $ (313,000) | ||||||||||
Stock warrants exercised (in shares) | 45,836 | ||||||||||
Warrant [Member] | |||||||||||
Diluted earnings per share: | |||||||||||
Antidilutive securities | 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 [Member] | |||||||||||
Diluted earnings per share: | |||||||||||
Dilutive effect of share-based payment awards (in shares) | 539,270 | 563,781 | 510,454 | 525,627 | |||||||
Employee and Nonemployee Stock Options [Member] | |||||||||||
Diluted earnings per share: | |||||||||||
Dilutive effect of share-based payment awards (in shares) | 73,032 | 53,476 |
Regulatory & Capital Matters (D
Regulatory & Capital Matters (Details) | Sep. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 |
Regulatory & Capital Matters | |||
Tier 1 capital leverage ratio (as a percent) | 11.54% | 11.54% | 10.08% |
Risk-based capital ratio (as a percent) | 14.34% | 14.34% | 12.63% |
Risk-based capital ratio, basis point decrease (as a percent) | 158.00% | ||
Subsidiaries [Member] | |||
Regulatory & Capital Matters | |||
Tier 1 capital leverage ratio (as a percent) | 12.68% | 12.68% | 11.36% |
Risk-based capital ratio (as a percent) | 15.72% | 15.72% | 14.14% |
Tier One leverage ratio, basis point increase (as a percent) | 1.32% | ||
Minimum [Member] | Subsidiaries [Member] | |||
Regulatory & Capital Matters | |||
Tier 1 capital leverage ratio, board-designated threshold | 8.00% | 8.00% | |
Total Capital Ratio, board-designated threshold (as a percent) | 12.00% | 12.00% |
Regulatory & Capital Matters -
Regulatory & Capital Matters - Capital Levels and Industry Defined Regulatory Minimums (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Common equity tier 1 capital to risk weighted assets | ||
Actual | $ 240,643 | $ 207,597 |
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable | $ 154,683 | $ 142,444 |
Common equity tier 1 capital to risk weighted assets, Ratio | ||
Actual (as a percent) | 10.89% | 9.29% |
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent) | 7.00% | 6.375% |
Total capital to risk weighted assets, Amount | ||
Actual at period end | $ 316,914 | $ 282,126 |
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable | $ 232,050 | $ 220,648 |
Total capital to risk weighted assets, Ratio | ||
Risk-based capital ratio (as a percent) | 14.34% | 12.63% |
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent) | 10.50% | 9.875% |
Tier 1 capital to risk weighted assets, Amount | ||
Actual | $ 297,268 | $ 263,125 |
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable | $ 187,865 | $ 175,960 |
Tier 1 capital to risk weighted assets, Ratio | ||
Actual (as a percent) | 13.45% | 11.78% |
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent) | 8.50% | 7.875% |
Tier 1 capital to average assets, Amount | ||
Actual | $ 297,268 | $ 263,125 |
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable | $ 103,039 | $ 104,415 |
Tier 1 capital to average assets, Ratio | ||
Tier 1 capital leverage ratio (as a percent) | 11.54% | 10.08% |
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent) | 4.00% | 4.00% |
Subsidiaries [Member] | ||
Common equity tier 1 capital to risk weighted assets | ||
Actual | $ 325,983 | $ 295,599 |
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable | 153,869 | 141,791 |
Minimum Required to Be Well Capitalized | $ 153,869 | $ 144,571 |
Common equity tier 1 capital to risk weighted assets, Ratio | ||
Actual (as a percent) | 14.83% | 13.29% |
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent) | 7.00% | 6.375% |
Minimum Required to Be Well Capitalized (as a percent) | 6.50% | 6.50% |
Total capital to risk weighted assets, Amount | ||
Actual at period end | $ 345,629 | $ 314,600 |
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable | 230,859 | 219,637 |
Minimum Required to Be Well Capitalized | $ 230,859 | $ 222,417 |
Total capital to risk weighted assets, Ratio | ||
Risk-based capital ratio (as a percent) | 15.72% | 14.14% |
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent) | 10.50% | 9.875% |
Minimum Required to Be Well Capitalized (as a percent) | 10.00% | 10.00% |
Tier 1 capital to risk weighted assets, Amount | ||
Actual | $ 325,983 | $ 295,599 |
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable | 186,841 | 175,153 |
Minimum Required to Be Well Capitalized | $ 186,841 | $ 177,934 |
Tier 1 capital to risk weighted assets, Ratio | ||
Actual (as a percent) | 14.83% | 13.29% |
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent) | 8.50% | 7.875% |
Minimum Required to Be Well Capitalized (as a percent) | 8.00% | 8.00% |
Tier 1 capital to average assets, Amount | ||
Actual | $ 325,983 | $ 295,599 |
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable | 102,834 | 104,084 |
Minimum Required to Be Well Capitalized | $ 128,542 | $ 130,105 |
Tier 1 capital to average assets, Ratio | ||
Tier 1 capital leverage ratio (as a percent) | 12.68% | 11.36% |
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, 2019 | |
Dividend Restrictions and Deferrals | |
Number of previous years retained profit considered for dividend payment | 2 years |
Fair Value Measurements - Recur
Fair Value Measurements - Recurring (Details) - USD ($) $ in Thousands | 9 Months Ended | ||||
Sep. 30, 2019 | Sep. 30, 2018 | Mar. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | |
Assets: | |||||
Securities available-for-sale | $ 488,422 | $ 488,422 | $ 541,248 | ||
Mortgage servicing rights | 5,361 | 7,357 | |||
US Treasury Securities [Member] | |||||
Assets: | |||||
Securities available-for-sale | $ 4,038 | 3,923 | |||
US Government Corporations and Agencies Securities [Member] | |||||
Assets: | |||||
Securities available-for-sale | 9,143 | 10,951 | |||
Mortgage Backed Securities, Issued by US Government Agencies [Member] | |||||
Assets: | |||||
Securities available-for-sale | $ 16,940 | ||||
US States and Political Subdivisions Debt Securities [Member] | |||||
Assets and liabilities measured at fair value on a recurring basis | |||||
Purchases | 17,643 | $ 20,421 | |||
Assets: | |||||
Securities available-for-sale | 238,727 | 274,067 | |||
Collateralized Mortgage Obligations [Member] | |||||
Assets: | |||||
Securities available-for-sale | 64,121 | 64,429 | |||
Asset-backed Securities [Member] | |||||
Assets: | |||||
Securities available-for-sale | 83,182 | 109,514 | |||
Collateralized loan obligations | |||||
Assets: | |||||
Securities available-for-sale | 72,271 | 64,289 | |||
Fair Value, Inputs, Level 1 [Member] | |||||
Assets: | |||||
Securities available-for-sale | 4,038 | 3,923 | |||
Fair Value, Inputs, Level 2 [Member] | |||||
Assets: | |||||
Securities available-for-sale | 478,511 | 529,160 | |||
Loans held-for-sale | 5,592 | 2,984 | |||
Liabilities: | |||||
Other liabilities | 4,696 | 58 | |||
Fair Value, Inputs, Level 3 [Member] | |||||
Assets: | |||||
Securities available-for-sale | 5,873 | 8,165 | $ 9,500 | ||
Mortgage servicing rights | 5,361 | 7,357 | |||
Fair Value, Inputs, Level 3 [Member] | US States and Political Subdivisions Debt Securities [Member] | |||||
Assets: | |||||
Securities available-for-sale | 5,900 | ||||
Fair Value, Inputs, Level 3 [Member] | Collateralized Mortgage Obligations [Member] | |||||
Assets: | |||||
Securities available-for-sale | $ 1,600 | ||||
Fair Value, Measurements, Recurring [Member] | |||||
Assets: | |||||
Securities available-for-sale | 10,951 | ||||
Total financial assets | 503,584 | 552,420 | |||
Liabilities: | |||||
Total | 8,532 | 756 | |||
Fair Value, Measurements, Recurring [Member] | Finite-Lived Intangible Assets [Member] | |||||
Assets: | |||||
Loans held-for-sale | 5,592 | 2,984 | |||
Mortgage servicing rights | 5,361 | 7,357 | |||
Fair Value, Measurements, Recurring [Member] | Interest Rate Swap [Member] | |||||
Liabilities: | |||||
Other liabilities | 8,532 | 756 | |||
Fair Value, Measurements, Recurring [Member] | Interest Rate Swap [Member] | Finite-Lived Intangible Assets [Member] | |||||
Assets: | |||||
Other assets | 3,756 | 672 | |||
Fair Value, Measurements, Recurring [Member] | Forward Contracts [Member] | Finite-Lived Intangible Assets [Member] | |||||
Assets: | |||||
Other assets | 453 | 159 | |||
Fair Value, Measurements, Recurring [Member] | US Treasury Securities [Member] | |||||
Assets: | |||||
Securities available-for-sale | 3,923 | ||||
Fair Value, Measurements, Recurring [Member] | US Treasury Securities [Member] | Finite-Lived Intangible Assets [Member] | |||||
Assets: | |||||
Securities available-for-sale | 4,038 | ||||
Fair Value, Measurements, Recurring [Member] | US Government Corporations and Agencies Securities [Member] | Finite-Lived Intangible Assets [Member] | |||||
Assets: | |||||
Securities available-for-sale | 9,143 | ||||
Fair Value, Measurements, Recurring [Member] | Mortgage Backed Securities, Issued by US Government Agencies [Member] | Finite-Lived Intangible Assets [Member] | |||||
Assets: | |||||
Securities available-for-sale | 16,940 | 14,075 | |||
Fair Value, Measurements, Recurring [Member] | US States and Political Subdivisions Debt Securities [Member] | Finite-Lived Intangible Assets [Member] | |||||
Assets: | |||||
Securities available-for-sale | 238,727 | 274,067 | |||
Fair Value, Measurements, Recurring [Member] | Collateralized Mortgage Obligations [Member] | Finite-Lived Intangible Assets [Member] | |||||
Assets: | |||||
Securities available-for-sale | 64,121 | 64,429 | |||
Fair Value, Measurements, Recurring [Member] | Asset-backed Securities [Member] | Finite-Lived Intangible Assets [Member] | |||||
Assets: | |||||
Securities available-for-sale | 83,182 | 109,514 | |||
Fair Value, Measurements, Recurring [Member] | Collateralized loan obligations | Finite-Lived Intangible Assets [Member] | |||||
Assets: | |||||
Securities available-for-sale | 72,271 | 64,289 | |||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | |||||
Assets: | |||||
Total financial assets | 4,038 | 3,923 | |||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | US Treasury Securities [Member] | |||||
Assets: | |||||
Securities available-for-sale | 3,923 | ||||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | US Treasury Securities [Member] | Finite-Lived Intangible Assets [Member] | |||||
Assets: | |||||
Securities available-for-sale | 4,038 | ||||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | |||||
Assets: | |||||
Securities available-for-sale | 10,951 | ||||
Total financial assets | 488,312 | 532,975 | |||
Liabilities: | |||||
Total | 8,532 | 756 | |||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Finite-Lived Intangible Assets [Member] | |||||
Assets: | |||||
Loans held-for-sale | 5,592 | 2,984 | |||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Interest Rate Swap [Member] | |||||
Liabilities: | |||||
Other liabilities | 8,532 | 756 | |||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Interest Rate Swap [Member] | Finite-Lived Intangible Assets [Member] | |||||
Assets: | |||||
Other assets | 3,756 | 672 | |||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Forward Contracts [Member] | Finite-Lived Intangible Assets [Member] | |||||
Assets: | |||||
Other assets | 453 | 159 | |||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | US Government Corporations and Agencies Securities [Member] | Finite-Lived Intangible Assets [Member] | |||||
Assets: | |||||
Securities available-for-sale | 9,143 | ||||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Mortgage Backed Securities, Issued by US Government Agencies [Member] | Finite-Lived Intangible Assets [Member] | |||||
Assets: | |||||
Securities available-for-sale | 16,940 | 14,075 | |||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | US States and Political Subdivisions Debt Securities [Member] | Finite-Lived Intangible Assets [Member] | |||||
Assets: | |||||
Securities available-for-sale | 232,854 | 265,902 | |||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Collateralized Mortgage Obligations [Member] | Finite-Lived Intangible Assets [Member] | |||||
Assets: | |||||
Securities available-for-sale | 64,121 | 64,429 | |||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Asset-backed Securities [Member] | Finite-Lived Intangible Assets [Member] | |||||
Assets: | |||||
Securities available-for-sale | 83,182 | 109,514 | |||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Collateralized loan obligations | Finite-Lived Intangible Assets [Member] | |||||
Assets: | |||||
Securities available-for-sale | 72,271 | 64,289 | |||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | |||||
Assets: | |||||
Total financial assets | 11,234 | 15,522 | |||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | Finite-Lived Intangible Assets [Member] | |||||
Assets: | |||||
Mortgage servicing rights | 5,361 | 7,357 | |||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | US States and Political Subdivisions Debt Securities [Member] | Finite-Lived Intangible Assets [Member] | |||||
Assets: | |||||
Securities available-for-sale | $ 5,873 | $ 8,165 |
Fair Value Measurements - Chang
Fair Value Measurements - Changes in Level 3 (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
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 | |
US States and Political Subdivisions Debt Securities [Member] | ||
Changes in Level 3 | ||
Beginning balance | $ 8,165 | 14,261 |
Total gains or losses | ||
Included in other comprehensive income | 898 | (805) |
Purchases, issuances, sales, and settlements | ||
Purchases | 17,643 | 20,421 |
Settlements | (20,808) | (24,366) |
Ending balance | 5,873 | 9,511 |
Changes in Level 3 (liabilities) | ||
Included in earnings (or changes in net assets) | (25) | |
Mortgage Servicing Rights [Member] | ||
Changes in Level 3 | ||
Beginning balance | 7,357 | 6,944 |
Total gains or losses | ||
Included in earnings (or changes in net assets) | 636 | |
Purchases, issuances, sales, and settlements | ||
Issuances | 906 | 997 |
Settlements | (518) | (446) |
Ending balance | 5,361 | $ 8,131 |
Changes in Level 3 (liabilities) | ||
Included in earnings (or changes in net assets) | $ (2,384) |
Fair Value Measurements - Quant
Fair Value Measurements - Quantitative and Qualitative Information (Details) $ in Thousands | Sep. 30, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) |
Quantitative information about Level 3 fair value measurements | ||||
Mortgage servicing rights, fair value | $ 5,361 | $ 7,357 | ||
Securities available-for-sale, at fair value | 488,422 | 541,248 | $ 488,422 | |
Fair Value, Inputs, Level 3 [Member] | ||||
Quantitative information about Level 3 fair value measurements | ||||
Mortgage servicing rights, fair value | 5,361 | 7,357 | ||
Securities available-for-sale, at fair value | 5,873 | 8,165 | $ 9,500 | |
US States and Political Subdivisions Debt Securities [Member] | ||||
Quantitative information about Level 3 fair value measurements | ||||
Securities available-for-sale, at fair value | 238,727 | 274,067 | ||
US States and Political Subdivisions Debt Securities [Member] | Fair Value, Inputs, Level 3 [Member] | ||||
Quantitative information about Level 3 fair value measurements | ||||
Securities available-for-sale, at fair value | 5,900 | |||
Collateralized Mortgage Obligations [Member] | ||||
Quantitative information about Level 3 fair value measurements | ||||
Securities available-for-sale, at fair value | $ 64,121 | $ 64,429 | ||
Collateralized Mortgage Obligations [Member] | Fair Value, Inputs, Level 3 [Member] | ||||
Quantitative information about Level 3 fair value measurements | ||||
Securities available-for-sale, at fair value | $ 1,600 | |||
Measurement Input, Discount Rate | Mortgage Servicing Rights [Member] | Fair Value, Inputs, Level 3 [Member] | ||||
Quantitative information about Level 3 fair value measurements | ||||
Servicing Asset, Measurement Input | 10.2 | |||
Measurement Input, Discount Rate | Mortgage Servicing Rights [Member] | Fair Value, Inputs, Level 3 [Member] | Minimum [Member] | ||||
Quantitative information about Level 3 fair value measurements | ||||
Servicing Asset, Measurement Input | 10 | |||
Measurement Input, Discount Rate | Mortgage Servicing Rights [Member] | Fair Value, Inputs, Level 3 [Member] | Maximum [Member] | ||||
Quantitative information about Level 3 fair value measurements | ||||
Servicing Asset, Measurement Input | 229.7 | |||
Measurement Input, Discount Rate | Mortgage Servicing Rights [Member] | Fair Value, Inputs, Level 3 [Member] | Weighted Average [Member] | ||||
Quantitative information about Level 3 fair value measurements | ||||
Servicing Asset, Measurement Input | 10.1 | |||
Measurement Input, Constant Prepayment Rate | Mortgage Servicing Rights [Member] | Fair Value, Inputs, Level 3 [Member] | ||||
Quantitative information about Level 3 fair value measurements | ||||
Servicing Asset, Measurement Input | 9.6 | |||
Measurement Input, Constant Prepayment Rate | Mortgage Servicing Rights [Member] | Fair Value, Inputs, Level 3 [Member] | Minimum [Member] | ||||
Quantitative information about Level 3 fair value measurements | ||||
Servicing Asset, Measurement Input | 7 | 7 | ||
Measurement Input, Constant Prepayment Rate | Mortgage Servicing Rights [Member] | Fair Value, Inputs, Level 3 [Member] | Maximum [Member] | ||||
Quantitative information about Level 3 fair value measurements | ||||
Servicing Asset, Measurement Input | 69 | 68.9 | ||
Measurement Input, Constant Prepayment Rate | Mortgage Servicing Rights [Member] | Fair Value, Inputs, Level 3 [Member] | Weighted Average [Member] | ||||
Quantitative information about Level 3 fair value measurements | ||||
Servicing Asset, Measurement Input | 16.6 | |||
Fair Value, Measurements, Recurring [Member] | ||||
Quantitative information about Level 3 fair value measurements | ||||
Securities available-for-sale, at fair value | $ 10,951 |
Fair Value Measurements - Nonre
Fair Value Measurements - Nonrecurring (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Dec. 31, 2018 | |
Assets and liabilities measured at fair value | ||
Valuation allowance | $ 274 | $ 352 |
Carrying value of other real estate owned | 4,682 | 7,175 |
Impaired Loans [Member] | ||
Assets and liabilities measured at fair value | ||
Valuation allowance | 12,500 | |
Fair Value, Measurements, Nonrecurring [Member] | ||
Assets and liabilities measured at fair value | ||
Total | 10,184 | 19,338 |
Fair Value, Measurements, Nonrecurring [Member] | Impaired Loans [Member] | ||
Assets and liabilities measured at fair value | ||
Total | 5,502 | 12,163 |
Valuation allowance | 274 | 352,000,000 |
Increase (decrease) of specific allocations within the provision for loan losses | 78 | 208,000,000 |
Fair Value, Measurements, Nonrecurring [Member] | Impaired Loans [Member] | Reported Value Measurement [Member] | ||
Assets and liabilities measured at fair value | ||
Total | 5,800 | |
Fair Value, Measurements, Nonrecurring [Member] | Other Real Estate Owned [Member] | ||
Assets and liabilities measured at fair value | ||
Total | 4,682 | 7,175 |
Carrying value of other real estate owned | 4,700 | 7,200 |
Outstanding balance | 13,100 | 16,000 |
OREO Valuation allowance | 8,100 | 8,000 |
OREO participations | 937,000,000 | 900,000 |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Assets and liabilities measured at fair value | ||
Total | 10,184 | 19,338 |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 3 [Member] | Impaired Loans [Member] | ||
Assets and liabilities measured at fair value | ||
Total | 5,502 | 12,163 |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 3 [Member] | Other Real Estate Owned [Member] | ||
Assets and liabilities measured at fair value | ||
Total | $ 4,682 | $ 7,175 |
Fair Values of Financial Inst_3
Fair Values of Financial Instruments (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 |
Financial assets: | ||||
Cash and due from banks | $ 42,671 | $ 38,599 | ||
Interest bearing deposits with financial institutions | 11,366 | 16,636 | ||
Securities available-for-sale | 488,422 | 541,248 | $ 488,422 | |
FHLBC and FRBC Stock | 10,711 | 13,433 | ||
Bank-owned life insurance | 62,589 | 61,544 | ||
Financial liabilities: | ||||
Noninterest bearing deposits | 643,355 | 618,830 | ||
Other short-term borrowings | 84,000 | 149,500 | ||
Junior subordinated debentures | 57,722 | 57,686 | ||
Reported Value Measurement [Member] | ||||
Financial assets: | ||||
Cash and due from banks | 42,671 | 38,599 | ||
Interest bearing deposits with financial institutions | 11,366 | 16,636 | ||
Securities available-for-sale | 488,422 | 541,248 | ||
FHLBC and FRBC Stock | 10,711 | 13,433 | ||
Loans held for sale | 5,592 | 2,984 | ||
Net loans | 1,880,160 | 1,878,021 | ||
Accrued interest receivable | 9,854 | 10,940 | ||
Financial liabilities: | ||||
Noninterest bearing deposits | 643,355 | 618,830 | ||
Interest bearing deposits | 1,431,136 | 1,497,843 | ||
Securities sold under repurchase agreements | 48,870 | 46,632 | ||
Other short-term borrowings | 84,000 | 149,500 | ||
Junior subordinated debentures | 57,722 | 57,686 | ||
Senior notes | 44,244 | 44,158 | ||
Note payable and other borrowings | 8,856 | 15,379 | ||
Interest rate swap | 4,696 | 58 | ||
Borrowing interest payable | 744 | 281 | ||
Deposit interest payable | 950 | 973 | ||
Estimate of Fair Value Measurement [Member] | ||||
Financial assets: | ||||
Cash and due from banks | 42,671 | 38,599 | ||
Interest bearing deposits with financial institutions | 11,366 | 16,636 | ||
Securities available-for-sale | 488,422 | 541,248 | ||
FHLBC and FRBC Stock | 10,711 | 13,433 | ||
Loans held for sale | 5,592 | 2,984 | ||
Net loans | 1,915,103 | 1,867,594 | ||
Accrued interest receivable | 9,854 | 10,940 | ||
Financial liabilities: | ||||
Noninterest bearing deposits | 643,355 | 618,830 | ||
Interest bearing deposits | 1,431,267 | 1,495,614 | ||
Securities sold under repurchase agreements | 48,870 | 46,632 | ||
Other short-term borrowings | 84,000 | 149,500 | ||
Junior subordinated debentures | 42,170 | 47,625 | ||
Senior notes | 46,269 | 45,008 | ||
Note payable and other borrowings | 8,856 | 15,379 | ||
Interest rate swap | 4,696 | 58 | ||
Borrowing interest payable | 744 | 281 | ||
Deposit interest payable | 950 | 973 | ||
Fair Value, Inputs, Level 1 [Member] | ||||
Financial assets: | ||||
Cash and due from banks | 42,671 | 38,599 | ||
Interest bearing deposits with financial institutions | 11,366 | 16,636 | ||
Securities available-for-sale | 4,038 | 3,923 | ||
Financial liabilities: | ||||
Noninterest bearing deposits | 643,355 | 618,830 | ||
Junior subordinated debentures | 34,557 | 32,989 | ||
Senior notes | 46,269 | 45,008 | ||
Fair Value, Inputs, Level 2 [Member] | ||||
Financial assets: | ||||
Securities available-for-sale | 478,511 | 529,160 | ||
FHLBC and FRBC Stock | 10,711 | 13,433 | ||
Loans held for sale | 5,592 | 2,984 | ||
Accrued interest receivable | 9,854 | 10,940 | ||
Financial liabilities: | ||||
Interest bearing deposits | 1,431,267 | 1,495,614 | ||
Securities sold under repurchase agreements | 48,870 | 46,632 | ||
Other short-term borrowings | 84,000 | 149,500 | ||
Junior subordinated debentures | 7,613 | 14,636 | ||
Note payable and other borrowings | 8,856 | 15,379 | ||
Interest rate swap | 4,696 | 58 | ||
Borrowing interest payable | 744 | 281 | ||
Deposit interest payable | 950 | 973 | ||
Fair Value, Inputs, Level 3 [Member] | ||||
Financial assets: | ||||
Securities available-for-sale | 5,873 | 8,165 | $ 9,500 | |
Net loans | $ 1,915,103 | $ 1,867,594 |
Financial Instruments with Of_2
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions - Fair Value of Derivatives (Details) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019USD ($)item | Dec. 31, 2018USD ($)item | |
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 | $ 256,000 | |
Designated as Hedging Instrument [Member] | ||
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions | ||
Derivative liabilities designated as hedging instruments, fair value | $ 4,696,000 | |
Designated as Hedging Instrument [Member] | Interest Rate Products | ||
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions | ||
Derivative, number of transactions | item | 1 | 1 |
Notional Amount | $ 25,774,000 | |
Derivated liabilities designated as hedging instruments, classified in other liabilities | 4,696,000 | |
Derivative liabilities designated as hedging instruments, fair value | $ 58,000 | |
Designated as Hedging Instrument [Member] | Interest Rate Products | OSBC Affiliates | ||
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions | ||
Notional Amount | 25,800,000 | |
Not Designated as Hedging Instrument [Member] | ||
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions | ||
Derivative assets not designated as hedging instruments, fair value | 4,209,000 | 831,000 |
Total Derivative liabilities not designated as hedging instruments, fair value | $ 3,835,000 | 698,000 |
Not Designated as Hedging Instrument [Member] | Interest Rate Products | Commercial Loan Customers | ||
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions | ||
Derivative, number of transactions | item | 24 | |
Notional Amount | $ 174,531,000 | $ 188,900,000 |
Interest rate derivatives, derivative assets not designated as hedging instruments, classified in other assets | 3,756,000 | |
Interest rate derivatives, derivative not designated as hedging instruments, classified in other liabilities | $ 3,756,000 | |
Weighted average maturity | 6 years | 6 years 7 months 6 days |
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | ||
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions | ||
Cash collateral pledged with financial institutions, dollars | $ 176,000 | $ 260,000 |
Investment securities pledged with financial institutions, dollars | $ 11,300,000 | $ 0 |
Number of correspondent financial institutions where investment securities are pledged | item | 1 | 1 |
Number of financial institutions where investment securities are required to be pledged | item | 2 | |
Not Designated as Hedging Instrument [Member] | Interest Rate Lock Commitments and Forward Contracts | ||
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions | ||
Derivative, number of transactions | item | 141 | 63 |
Notional Amount | $ 50,520,000 | $ 18,130,000 |
Interest rate derivatives, derivative assets not designated as hedging instruments, classified in other assets | $ 453,000 | $ 159,000 |
Not Designated as Hedging Instrument [Member] | Interest Rate Lock Commitments and Forward Contracts | Commercial Loan Customers | ||
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions | ||
Derivative, number of transactions | item | 25 | |
Notional Amount | $ 188,931,000 | |
Interest rate derivatives, derivative assets not designated as hedging instruments, classified in other assets | 672,000 | |
Interest rate derivatives, derivative not designated as hedging instruments, classified in other liabilities | $ 672,000 | |
Not Designated as Hedging Instrument [Member] | Other Contracts | ||
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions | ||
Derivative, number of transactions | item | 4 | 3 |
Notional Amount | $ 28,231,000 | $ 18,155,000 |
Derivated liabilities designated as hedging instruments, classified in other liabilities | $ 26,000 | |
Interest rate derivatives, derivative not designated as hedging instruments, classified in other liabilities | $ 79,000 |
Financial Instruments with Of_3
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions - Effect of Fair Value (Details) - USD ($) | Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 |
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions | ||||
Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income | $ 2,000,000 | $ (599,000) | ||
Interest Income (Expense) | ||||
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions | ||||
Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income | $ (12,000) | $ (27,000) | $ (145,000) | |
Amount of Gain or (Loss) Recognized in Income on Derivative | $ (29,000) |
Financial Instruments with Of_4
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions - Balance Sheet Risk - Commitments (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Company's contractual commitments due to letters of credit | ||
Total letters of credit | $ 15,061 | $ 14,862 |
Fixed [Member] | ||
Company's contractual commitments due to letters of credit | ||
Total letters of credit | 910 | 859 |
Variable [Member] | ||
Company's contractual commitments due to letters of credit | ||
Total letters of credit | 14,151 | 14,003 |
Commitments to Extend Credit to Borrowers [Member] | ||
Company's contractual commitments due to letters of credit | ||
Total letters of credit | 14,994 | 14,795 |
Commitments to Extend Credit to Borrowers [Member] | Fixed [Member] | ||
Company's contractual commitments due to letters of credit | ||
Total letters of credit | 910 | 859 |
Commitments to Extend Credit to Borrowers [Member] | Variable [Member] | ||
Company's contractual commitments due to letters of credit | ||
Total letters of credit | 14,084 | 13,936 |
Commitments to Extend Credit to Borrowers [Member] | Financial Standby Letter of Credit [Member] | ||
Company's contractual commitments due to letters of credit | ||
Total letters of credit | 7,757 | 7,485 |
Commitments to Extend Credit to Borrowers [Member] | Financial Standby Letter of Credit [Member] | Fixed [Member] | ||
Company's contractual commitments due to letters of credit | ||
Total letters of credit | 339 | 327 |
Commitments to Extend Credit to Borrowers [Member] | Financial Standby Letter of Credit [Member] | Variable [Member] | ||
Company's contractual commitments due to letters of credit | ||
Total letters of credit | 7,418 | 7,158 |
Commitments to Extend Credit to Borrowers [Member] | Standby Letters of Credit [Member] | ||
Company's contractual commitments due to letters of credit | ||
Total letters of credit | 354 | 397 |
Commitments to Extend Credit to Borrowers [Member] | Standby Letters of Credit [Member] | Variable [Member] | ||
Company's contractual commitments due to letters of credit | ||
Total letters of credit | 354 | 397 |
Commitments to Extend Credit to Borrowers [Member] | Performance Guarantee [Member] | ||
Company's contractual commitments due to letters of credit | ||
Total letters of credit | 6,883 | 6,913 |
Commitments to Extend Credit to Borrowers [Member] | Performance Guarantee [Member] | Fixed [Member] | ||
Company's contractual commitments due to letters of credit | ||
Total letters of credit | 571 | 532 |
Commitments to Extend Credit to Borrowers [Member] | Performance Guarantee [Member] | Variable [Member] | ||
Company's contractual commitments due to letters of credit | ||
Total letters of credit | 6,312 | 6,381 |
Commitments to Extend Credit Nonborrowers [Member] | Performance Guarantee [Member] | ||
Company's contractual commitments due to letters of credit | ||
Total letters of credit | 67 | 67 |
Commitments to Extend Credit Nonborrowers [Member] | Performance Guarantee [Member] | Variable [Member] | ||
Company's contractual commitments due to letters of credit | ||
Total letters of credit | $ 67 | $ 67 |