Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Sep. 30, 2020 | Nov. 01, 2020 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | AMERISERV FINANCIAL INC /PA/ | |
Entity Central Index Key | 0000707605 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Current Reporting Status | Yes | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Interactive Data Current | Yes | |
Entity Common Stock, Shares Outstanding | 17,058,644 | |
COMMON STOCK | ||
Document Information [Line Items] | ||
Trading Symbol | ASRV | |
Title of 12(b) Security | Common Stock | |
Security Exchange Name | NASDAQ | |
Beneficial Unsecured Securities | ||
Document Information [Line Items] | ||
Trading Symbol | ASRVP | |
Title of 12(b) Security | Beneficial Unsecured Securities | |
Security Exchange Name | NASDAQ |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
ASSETS | ||
Cash and due from depository institutions | $ 17,986,000 | $ 15,642,000 |
Interest bearing deposits | 3,214,000 | 2,755,000 |
Short-term investments | 20,008,000 | 3,771,000 |
Cash and cash equivalents | 41,208,000 | 22,168,000 |
Investment securities: | ||
Available for sale, at fair value | 141,716,000 | 141,749,000 |
Held to maturity (fair value $45,308 on September 30, 2020 and $41,082 on December 31, 2019) | 42,636,000 | 39,936,000 |
Loans held for sale | 7,587,000 | 4,868,000 |
Loans | 943,246,000 | 883,090,000 |
Less: Unearned income | 1,466,000 | 384,000 |
Less : Allowance for loan losses | 10,284,000 | 9,279,000 |
Net loans | 931,496,000 | 873,427,000 |
Premises and equipment: | ||
Operating lease right-of-use asset | 781,000 | 846,000 |
Financing lease right-of-use asset | 3,024,000 | 3,078,000 |
Other premises and equipment, net | 14,533,000 | 14,643,000 |
Accrued interest income receivable | 5,722,000 | 3,449,000 |
Goodwill | 11,944,000 | 11,944,000 |
Bank owned life insurance | 39,354,000 | 38,916,000 |
Net deferred tax asset | 3,216,000 | 3,976,000 |
Federal Home Loan Bank stock | 4,153,000 | 3,985,000 |
Federal Reserve Bank stock | 2,125,000 | 2,125,000 |
Other assets | 8,636,000 | 6,074,000 |
TOTAL ASSETS | 1,258,131,000 | 1,171,184,000 |
LIABILITIES | ||
Non-interest bearing deposits | 179,922,000 | 136,462,000 |
Interest bearing deposits | 862,313,000 | 824,051,000 |
Total deposits | 1,042,235,000 | 960,513,000 |
Short-term borrowings | 5,894,000 | 22,412,000 |
Advances from Federal Home Loan Bank | 74,336,000 | 53,668,000 |
Operating lease liabilities | 798,000 | 865,000 |
Financing lease liabilities | 3,161,000 | 3,163,000 |
Guaranteed junior subordinated deferrable interest debentures | 12,966,000 | 12,955,000 |
Subordinated debt | 7,528,000 | 7,511,000 |
Total borrowed funds | 104,683,000 | 100,574,000 |
Other liabilities | 7,844,000 | 11,483,000 |
TOTAL LIABILITIES | 1,154,762,000 | 1,072,570,000 |
SHAREHOLDERS’ EQUITY | ||
Common stock, par value $0.01 per share; 30,000,000 shares authorized; 26,687,463 shares issued and 17,058,644 shares outstanding on September 30, 2020; 26,650,728 shares issued and 17,057,871 shares outstanding on December 31, 2019 | 267,000 | 267,000 |
Treasury stock at cost, 9,628,819 shares on September 30, 2020 and 9,592,857 shares on December 31, 2019 | (83,280,000) | (83,129,000) |
Capital surplus | 145,965,000 | 145,888,000 |
Retained earnings | 54,375,000 | 51,759,000 |
Accumulated other comprehensive loss, net | (13,958,000) | (16,171,000) |
TOTAL SHAREHOLDERS’ EQUITY | 103,369,000 | 98,614,000 |
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ 1,258,131,000 | $ 1,171,184,000 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
CONSOLIDATED BALANCE SHEETS | ||
Held to maturity securities, fair value | $ 45,308 | $ 41,082 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 30,000,000 | 30,000,000 |
Common stock, shares issued | 26,687,463 | 26,650,728 |
Common stock, shares outstanding | 17,058,644 | 17,057,871 |
Treasury stock, shares | 9,628,819 | 9,592,857 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
INTEREST INCOME | ||||
Interest and fees on loans | $ 9,724,000 | $ 10,737,000 | $ 30,504,000 | $ 32,149,000 |
Interest bearing deposits | 4,000 | 6,000 | 11,000 | 19,000 |
Short-term investments | 51,000 | 84,000 | 219,000 | 212,000 |
Investment securities: | ||||
Available for sale | 1,122,000 | 1,265,000 | 3,464,000 | 3,898,000 |
Held to maturity | 336,000 | 341,000 | 1,044,000 | 1,084,000 |
Total Interest Income | 11,237,000 | 12,433,000 | 35,242,000 | 37,362,000 |
INTEREST EXPENSE | ||||
Deposits | 1,727,000 | 2,895,000 | 6,054,000 | 8,492,000 |
Short-term borrowings | 1,000 | 38,000 | 17,000 | 276,000 |
Advances from Federal Home Loan Bank | 280,000 | 297,000 | 840,000 | 793,000 |
Financing lease liabilities | 28,000 | 29,000 | 85,000 | 88,000 |
Guaranteed junior subordinated deferrable interest debentures | 280,000 | 280,000 | 841,000 | 841,000 |
Subordinated debt | 130,000 | 130,000 | 390,000 | 390,000 |
Total Interest Expense | 2,446,000 | 3,669,000 | 8,227,000 | 10,880,000 |
Net Interest Income | 8,791,000 | 8,764,000 | 27,015,000 | 26,482,000 |
Provision (credit) for loan losses | 675,000 | 225,000 | 1,300,000 | (175,000) |
Net Interest Income after Provision (Credit) for Loan Losses | 8,116,000 | 8,539,000 | 25,715,000 | 26,657,000 |
NON-INTEREST INCOME | ||||
Non-interest income | 3,295,000 | 3,223,000 | 9,568,000 | 9,519,000 |
Net gains on loans held for sale | 507,000 | 405,000 | 1,079,000 | 574,000 |
Mortgage related fees | 161,000 | 97,000 | 432,000 | 218,000 |
Net realized gains on investment securities | 88,000 | 118,000 | ||
Bank owned life insurance | 161,000 | 131,000 | 438,000 | 388,000 |
Other income | 665,000 | 622,000 | 1,657,000 | 1,865,000 |
Total Non-Interest Income | 4,304,000 | 4,095,000 | 11,903,000 | 11,357,000 |
NON-INTEREST EXPENSE | ||||
Salaries and employee benefits | 6,838,000 | 6,324,000 | 20,161,000 | 18,973,000 |
Net occupancy expense | 608,000 | 599,000 | 1,885,000 | 1,879,000 |
Equipment expense | 374,000 | 333,000 | 1,158,000 | 1,081,000 |
Professional fees | 1,373,000 | 1,276,000 | 3,858,000 | 3,645,000 |
Supplies, postage and freight | 150,000 | 142,000 | 551,000 | 455,000 |
Miscellaneous taxes and insurance | 291,000 | 280,000 | 855,000 | 851,000 |
Federal deposit insurance expense | 140,000 | 296,000 | 160,000 | |
Other expense | 1,333,000 | 1,549,000 | 3,982,000 | 4,208,000 |
Total Non-Interest Expense | 11,107,000 | 10,503,000 | 32,746,000 | 31,252,000 |
PRETAX INCOME | 1,313,000 | 2,131,000 | 4,872,000 | 6,762,000 |
Provision for income taxes | 235,000 | 442,000 | 966,000 | 1,403,000 |
NET INCOME | $ 1,078,000 | $ 1,689,000 | $ 3,906,000 | $ 5,359,000 |
Basic: | ||||
Net income | $ 0.06 | $ 0.10 | $ 0.23 | $ 0.31 |
Average number of shares outstanding | 17,059 | 17,278 | 17,051 | 17,443 |
Diluted: | ||||
Net income | $ 0.06 | $ 0.10 | $ 0.23 | $ 0.31 |
Average number of shares outstanding | 17,062 | 17,360 | 17,063 | 17,524 |
Wealth management fees | ||||
NON-INTEREST INCOME | ||||
Non-interest income | $ 2,604,000 | $ 2,431,000 | $ 7,629,000 | $ 7,246,000 |
Service charges on deposit accounts | ||||
NON-INTEREST INCOME | ||||
Non-interest income | 206,000 | 321,000 | 668,000 | 948,000 |
Other | ||||
NON-INTEREST INCOME | ||||
Non-interest income | $ 485,000 | $ 471,000 | $ 1,271,000 | $ 1,325,000 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
COMPREHENSIVE INCOME | ||||
Net income | $ 1,078 | $ 1,689 | $ 3,906 | $ 5,359 |
Other comprehensive income, before tax: | ||||
Pension obligation change for defined benefit plan | 403 | 528 | (1,030) | |
Income tax effect | (85) | (111) | 216 | |
Unrealized holding gains on available for sale securities arising during period | 143 | 608 | 2,272 | 4,191 |
Income tax effect | (30) | (128) | (476) | (880) |
Reclassification adjustment for gains on available for sale securities included in net income | (88) | (118) | ||
Income tax effect | 19 | 25 | ||
Other comprehensive income | 113 | 729 | 2,213 | 2,404 |
Comprehensive income | $ 1,191 | $ 2,418 | $ 6,119 | $ 7,763 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | COMMON STOCK | TREASURY STOCK | CAPITAL SURPLUS | RETAINED EARNINGS | ACCUMULATED OTHER COMPREHENSIVE LOSS, NET | Total |
Balance at beginning of period at Dec. 31, 2018 | $ 266 | $ (80,579) | $ 145,782 | $ 46,733 | $ (14,225) | |
New common shares issued for exercise of stock options | 96 | |||||
Treasury stock, purchased at cost | (2,166) | |||||
Stock option expense | 6 | |||||
Net income | 5,359 | $ 5,359 | ||||
Cash dividend declared on common stock | (1,216) | |||||
Other comprehensive income | 2,404 | 2,404 | ||||
Balance at end of period at Sep. 30, 2019 | 266 | (82,745) | 145,884 | 50,876 | (11,821) | 102,460 |
Balance at beginning of period at Jun. 30, 2019 | 266 | (81,741) | 145,883 | 49,618 | (12,550) | |
Treasury stock, purchased at cost | (1,004) | |||||
Stock option expense | 1 | |||||
Net income | 1,689 | 1,689 | ||||
Cash dividend declared on common stock | (431) | |||||
Other comprehensive income | 729 | 729 | ||||
Balance at end of period at Sep. 30, 2019 | 266 | (82,745) | 145,884 | 50,876 | (11,821) | 102,460 |
Effect of adoption of revenue recognition standard – ASC Topic 606 | 51,759 | |||||
Balance at beginning of period at Dec. 31, 2019 | 267 | (83,129) | 145,888 | 51,759 | (16,171) | 98,614 |
New common shares issued for exercise of stock options | 75 | |||||
Treasury stock, purchased at cost | (151) | |||||
Stock option expense | 2 | |||||
Net income | 3,906 | 3,906 | ||||
Cash dividend declared on common stock | (1,290) | |||||
Other comprehensive income | 2,213 | 2,213 | ||||
Balance at end of period at Sep. 30, 2020 | 267 | (83,280) | 145,965 | 54,375 | (13,958) | 103,369 |
Balance at beginning of period at Jun. 30, 2020 | 267 | (83,280) | 145,965 | 53,723 | (14,071) | |
Net income | 1,078 | 1,078 | ||||
Cash dividend declared on common stock | (426) | |||||
Other comprehensive income | 113 | 113 | ||||
Balance at end of period at Sep. 30, 2020 | $ 267 | $ (83,280) | $ 145,965 | $ 54,375 | $ (13,958) | 103,369 |
Effect of adoption of revenue recognition standard – ASC Topic 606 | $ 54,375 |
CONSOLIDATED STATEMENTS OF CH_2
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Parenthetical) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
COMMON STOCK | ||||
New common shares issued for exercise of stock options, shares | 36,735 | 38,917 | ||
TREASURY STOCK | ||||
Treasury stock, purchased at cost, shares | 237,641 | 35,962 | 511,506 | |
CAPITAL SURPLUS | ||||
New common shares issued for exercise of stock options, shares | 36,735 | 38,917 | ||
RETAINED EARNINGS | ||||
Cash dividend declared per common share | $ 0.025 | $ 0.025 | $ 0.075 | $ 0.070 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
OPERATING ACTIVITIES | ||
Net income | $ 3,906,000 | $ 5,359,000 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Provision (credit) for loan losses | 1,300,000 | (175,000) |
Depreciation and amortization expense | 1,472,000 | 1,360,000 |
Net amortization of investment securities | 206,000 | 203,000 |
Net realized gains on investment securities — available for sale | (118,000) | |
Net gains on loans held for sale | (1,079,000) | (574,000) |
Amortization of deferred loan fees | (339,000) | (91,000) |
Origination of mortgage loans held for sale | (71,330,000) | (28,232,000) |
Sales of mortgage loans held for sale | 69,690,000 | 23,704,000 |
Increase in accrued interest receivable | (2,273,000) | (276,000) |
Increase (decrease) in accrued interest payable | (499,000) | 307,000 |
Earnings on bank owned life insurance | (438,000) | (388,000) |
Deferred income taxes | 609,000 | 623,000 |
Stock compensation expense | 2,000 | 6,000 |
Net change in operating leases | (67,000) | (46,000) |
Other, net | (5,564,000) | (323,000) |
Net cash provided by (used in) operating activities | (4,404,000) | 1,339,000 |
INVESTING ACTIVITIES | ||
Purchase of investment securities — available for sale | (23,706,000) | (11,701,000) |
Purchase of investment securities — held to maturity | (6,648,000) | (1,000,000) |
Proceeds from maturities of investment securities — available for sale | 25,871,000 | 15,704,000 |
Proceeds from maturities of investment securities — held to maturity | 3,883,000 | 2,403,000 |
Proceeds from sales of investment securities — available for sale | 0 | 3,374,000 |
Purchase of regulatory stock | (6,252,000) | (11,254,000) |
Proceeds from redemption of regulatory stock | 6,084,000 | 12,144,000 |
Long-term loans originated | (207,028,000) | (163,343,000) |
Principal collected on long-term loans | 147,958,000 | 156,357,000 |
Proceeds from sale of other real estate owned | 21,000 | 198,000 |
Purchase of premises and equipment | (1,094,000) | (2,550,000) |
Net cash provided by (used in) investing activities | (60,911,000) | 332,000 |
FINANCING ACTIVITIES | ||
Net increase in deposit balances | 81,722,000 | 20,818,000 |
Net decrease in other short-term borrowings | (16,518,000) | (29,754,000) |
Principal borrowings on advances from Federal Home Loan Bank | 34,210,000 | 16,909,000 |
Principal repayments on advances from Federal Home Loan Bank | (13,542,000) | (8,000,000) |
Principal payments on financing lease liabilities | (151,000) | (126,000) |
Stock options exercised | 75,000 | 96,000 |
Purchases of treasury stock | (151,000) | (2,166,000) |
Common stock dividend paid | (1,290,000) | (1,216,000) |
Net cash provided by (used in) financing activities | 84,355,000 | (3,439,000) |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 19,040,000 | (1,768,000) |
CASH AND CASH EQUIVALENTS AT JANUARY 1 | 22,168,000 | 34,894,000 |
CASH AND CASH EQUIVALENTS AT SEPTEMBER 30 | $ 41,208,000 | $ 33,126,000 |
Principles of Consolidation
Principles of Consolidation | 9 Months Ended |
Sep. 30, 2020 | |
Principles of Consolidation | |
Principles of Consolidation | 1. Principles of Consolidation The accompanying consolidated financial statements include the accounts of AmeriServ Financial, Inc. (the Company) and its wholly-owned subsidiaries, AmeriServ Financial Bank (the Bank), AmeriServ Trust and Financial Services Company (the Trust Company), and AmeriServ Life Insurance Company (AmeriServ Life). The Bank is a Pennsylvania state-chartered full service bank with 15 locations in Pennsylvania and 1 location in Maryland. The Trust Company offers a complete range of trust and financial services and administers assets valued at $2.3 billion that are not reported on the Company’s Consolidated Balance Sheets at September 30, 2020. AmeriServ Life was a captive insurance company that engaged in underwriting as a reinsurer of credit life and disability insurance. New business ceased being generated by AmeriServ Life in 2005. Since that time, the outstanding insurance policies have been running off, and the final policy has expired. On September 30, 2020, the Arizona Corporation Commission approved the Articles of Dissolution for AmeriServ Life. In addition, the Parent Company is an administrative group that provides support in such areas as audit, finance, investments, loan review, general services, and marketing. Intercompany accounts and transactions have been eliminated in preparing the Consolidated Financial Statements. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (generally accepted accounting principles, or GAAP) requires management to make estimates and assumptions that affect the amounts reported in the Consolidated Financial Statements and accompanying notes. Actual results may differ from these estimates and the differences may be material to the Consolidated Financial Statements. The Company’s most significant estimates relate to the allowance for loan losses, goodwill, income taxes, investment securities, pension, and the fair value of financial instruments. |
Basis of Preparation
Basis of Preparation | 9 Months Ended |
Sep. 30, 2020 | |
Basis of Preparation | |
Basis of Preparation | 2. Basis of Preparation The unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information. In the opinion of management, all adjustments consisting of normal recurring entries considered necessary for a fair presentation have been included. They are not, however, necessarily indicative of the results of consolidated operations for a full-year. For further information, refer to the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10‑K for the year ended December 31, 2019. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2020 | |
Recent Accounting Pronouncements | |
Recent Accounting Pronouncements | 3. Recent Accounting Pronouncements In June 2016, the FASB issued ASU 2016‑13, Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments (ASU 2016‑13), which changes the impairment model for most financial assets. This Update is intended to improve financial reporting by requiring timelier recording of credit losses on loans and other financial instruments held by financial institutions and other organizations. The underlying premise of the Update is that financial assets measured at amortized cost should be presented at the net amount expected to be collected, through an allowance for credit losses that is deducted from the amortized cost basis. The allowance for credit losses should reflect management’s current estimate of credit losses that are expected to occur over the remaining life of a financial asset. The income statement will be affected for the measurement of credit losses for newly recognized financial assets, as well as the expected increases or decreases of expected credit losses that have taken place during the period. With certain exceptions, transition to the new requirements will be through a cumulative effect adjustment to opening retained earnings as of the beginning of the first reporting period in which the guidance is adopted. In November 2019, the FASB issued ASU 2019-10, Financial Instruments - Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842) . This update defers the effective date of ASU 2016-13 for SEC filers that are eligible to be smaller reporting companies, non-SEC filers, and all other companies to fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company, as a smaller reporting company, continues to evaluate the impact that the Update will have on our consolidated financial statements. We are currently working with an industry leading third-party consultant and software provider to assist us in the implementation of this standard. We expect to recognize a one-time cumulative effect adjustment to the allowance for loan losses as of the beginning of the first reporting period in which the new standard is effective, but cannot yet determine the magnitude of any such one-time adjustment or the overall impact of the new guidance on the consolidated financial statements. The overall impact of the amendment will be affected by the portfolio composition and quality at the adoption date as well as economic conditions and forecasts at that time. In January 2020, the FASB issued ASU 2020-4, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, March 2020 , to provide temporary optional expedients and exceptions to the U.S. GAAP guidance on contract modifications to ease the financial reporting burdens of the expected market transition from LIBOR to alternative reference rates, such as Secured Overnight Financing Rate. Entities can elect not to apply certain modification accounting requirements to contracts affected by what the guidance calls reference rate reform, if certain criteria are met. An entity that makes this election would not have to remeasure the contracts at the modification date or reassess a previous accounting determination. The amendments in this ASU are effective for all entities upon issuance through December 31, 2022. The Company has identified its LIBOR exposure across product categories and is analyzing the risks associated with the LIBOR transition. However, it is too early to predict whether a new rate index replacement and the adoption of this ASU will have a material impact on the Company’s financial statements. |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Sep. 30, 2020 | |
Revenue Recognition | |
Revenue Recognition | 4. Revenue Recognition ASU 2014-09, Revenue from Contracts with Customers – Topic 606 , requires the Company to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers at the time the transfer of goods or services takes place. Management determined that the primary sources of revenue associated with financial instruments, including interest and fee income on loans and interest on investments, along with certain noninterest revenue sources including net realized gains (losses) on investment securities, mortgage related fees, net gains on loans held for sale, and bank owned life insurance are not within the scope of Topic 606. These sources of revenue cumulatively comprise 79.7% of the total revenue of the Company. Non-interest income within the scope of Topic 606 are as follows: · Wealth management fees - Wealth management fee income is primarily comprised of fees earned from the management and administration of trusts and customer investment portfolios. The Company’s performance obligation is generally satisfied over a period of time and the resulting fees are billed monthly or quarterly, based upon the month end market value of the assets under management. Payment is generally received after month end through a direct charge to customers’ accounts. Due to this delay in payment, a receivable of $825,000 has been established as of September 30, 2020 and is included in other assets on the Consolidated Balance Sheets in order to properly recognize the revenue earned but not yet received. Other performance obligations (such as delivery of account statements to customers) are generally considered immaterial to the overall transactions’ price. Commissions on transactions are recognized on a trade-date basis as the performance obligation is satisfied at the point in time in which the trade is processed. Also included within wealth management fees are commissions from the sale of mutual funds, annuities, and life insurance products. Commissions on the sale of mutual funds, annuities, and life insurance products are recognized when sold, which is when the Company has satisfied its performance obligation. · Service charges on deposit accounts - The Company has contracts with its deposit account customers where fees are charged for certain items or services. Service charges include account analysis fees, monthly service fees, overdraft fees, and other deposit account related fees. Revenue related to account analysis fees and service fees is recognized on a monthly basis as the Company has an unconditional right to the fee consideration. Fees attributable to specific performance obligations of the Company (i.e. overdraft fees, etc.) are recognized at a defined point in time based on completion of the requested service or transaction. · Other non-interest income - Other non-interest income consists of other recurring revenue streams such as safe deposit box rental fees, gain (loss) on sale of other real estate owned, ATM and VISA debit card fees, and other miscellaneous revenue streams. Safe deposit box rental fees are charged to the customer on an annual basis and recognized when billed. However, if the safe deposit box rental fee is prepaid (i.e. paid prior to issuance of annual bill), the revenue is recognized upon receipt of payment. The Company has determined that since rentals and renewals occur consistently over time, revenue is recognized on a basis consistent with the duration of the performance obligation. Gains and losses on the sale of other real estate owned are recognized at the completion of the property sale when the buyer obtains control of the real estate and all the performance obligations of the Company have been satisfied. The Company offers ATM and VISA debit cards to deposit account holders which allows our customers to access their account electronically at ATMs and POS terminals. Fees related to ATM and VISA debit card transactions are recognized when the transactions are completed and the Company has satisfied its performance obligation. The following presents non-interest income, segregated by revenue streams in-scope and out-of-scope of Topic 606, for the three and nine month periods ending September 30, 2020 and 2019 (in thousands). Three months ended Nine months ended September 30, September 30, 2020 2019 2020 2019 Non-interest income: In-scope of Topic 606 Wealth management fees $ 2,604 $ 2,431 $ 7,629 $ 7,246 Service charges on deposit accounts 206 321 668 948 Other 485 471 1,271 1,325 Non-interest income (in-scope of topic 606) 3,295 3,223 9,568 9,519 Non-interest income (out-of-scope of topic 606) 1,009 872 2,335 1,838 Total non-interest income $ 4,304 $ 4,095 $ 11,903 $ 11,357 |
Earnings Per Common Share
Earnings Per Common Share | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Common Share | |
Earnings Per Common Share | 5. Earnings Per Common Share Basic earnings per share include only the weighted average common shares outstanding. Diluted earnings per share include the weighted average common shares outstanding and any potentially dilutive common stock equivalent shares in the calculation. Treasury shares are excluded for earnings per share purposes. For the three month periods ending September 30, 2020 and 2019, options to purchase 189,259 common shares, with an exercise price of $2.96 to $4.22, and options to purchase 12,000 common shares, with an exercise price of $4.19 to $4.22, respectively, were outstanding but were not included in the computation of diluted earnings per common share because to do so would be antidilutive. For the nine month periods ending September 30, 2020 and 2019, options to purchase 69,759 common shares, with an exercise price of $3.20 to $4.22, and options to purchase 12,000 common shares, with an exercise price of $4.19 to 4.22, respectively, were outstanding but were not included in the computation of diluted earnings per common share because to do so would be antidilutive. Three months ended Nine months ended September 30, September 30, 2020 2019 2020 2019 (In thousands, except per share data) Numerator: Net income $ 1,078 $ 1,689 $ 3,906 $ 5,359 Denominator: Weighted average common shares outstanding (basic) 17,059 17,278 17,051 17,443 Effect of stock options 3 82 12 81 Weighted average common shares outstanding (diluted) 17,062 17,360 17,063 17,524 Earnings per common share : Basic $ 0.06 $ 0.10 $ 0.23 $ 0.31 Diluted 0.06 0.10 0.23 0.31 |
Consolidated Statement of Cash
Consolidated Statement of Cash Flows | 9 Months Ended |
Sep. 30, 2020 | |
Consolidated Statement of Cash Flows. | |
Consolidated Statement of Cash Flows | 6. Consolidated Statement of Cash Flows On a consolidated basis, cash and cash equivalents include cash and due from depository institutions, interest bearing deposits and short-term investments in both money market funds and commercial paper. The Company made $315,000 in income tax payments in the first nine months of 2020 and $785,000 in the same 2019 period. The Company made total interest payments of $8,726,000 in the first nine months of 2020 compared to $10,573,000 in the same 2019 period. The Company had $40,000 non-cash transfers to other real estate owned (OREO) in the first nine months of 2020 compared to $75,000 non-cash transfers in the same 2019 period. During the first nine months of 2020, the Company entered into two new financing leases, one related to office equipment and the other to a branch location, and recorded a right-of-use asset and lease liability of $149,000. As a result of the adoption of ASU 2016-02, Leases (Topic 842) as of January 1, 2019, the Company had non-cash transactions associated with the recognition of the right-of-use assets and lease liabilities. Specifically, the Company recognized a right-of-use asset and lease liability of $932,000 related to operating leases and a right-of-use asset and lease liability of $3.3 million related to financing leases during the first nine months of 2019. |
Investment Securities
Investment Securities | 9 Months Ended |
Sep. 30, 2020 | |
Investment Securities | |
Investment Securities | 7. Investment Securities The cost basis and fair values of investment securities are summarized as follows: Investment securities available for sale (AFS): SEPTEMBER 30, 2020 GROSS GROSS UNREALIZED UNREALIZED FAIR COST BASIS GAINS LOSSES VALUE (IN THOUSANDS) U.S. Agency $ 3,079 $ 197 $ — $ 3,276 U.S. Agency mortgage-backed securities 66,198 2,850 (6) 69,042 Municipal 17,409 1,242 — 18,651 Corporate bonds 50,586 557 (396) 50,747 Total $ 137,272 $ 4,846 $ (402) $ 141,716 Investment securities held to maturity (HTM): SEPTEMBER 30, 2020 GROSS GROSS UNREALIZED UNREALIZED FAIR COST BASIS GAINS LOSSES VALUE (IN THOUSANDS) U.S. Agency mortgage-backed securities $ 7,719 $ 394 $ — $ 8,113 Municipal 28,889 2,225 (51) 31,063 Corporate bonds and other securities 6,028 108 (4) 6,132 Total $ 42,636 $ 2,727 $ (55) $ 45,308 Investment securities available for sale (AFS): DECEMBER 31, 2019 GROSS GROSS UNREALIZED UNREALIZED FAIR COST BASIS GAINS LOSSES VALUE (IN THOUSANDS) U.S. Agency $ 5,084 $ 32 $ — $ 5,116 U.S. Agency mortgage-backed securities 80,046 1,681 (94) 81,633 Municipal 14,678 509 (17) 15,170 Corporate bonds 39,769 342 (281) 39,830 Total $ 139,577 $ 2,564 $ (392) $ 141,749 Investment securities held to maturity (HTM): DECEMBER 31, 2019 GROSS GROSS UNREALIZED UNREALIZED FAIR COST BASIS GAINS LOSSES VALUE (IN THOUSANDS) U.S. Agency mortgage-backed securities $ 9,466 $ 251 $ (4) $ 9,713 Municipal 24,438 941 (53) 25,326 Corporate bonds and other securities 6,032 58 (47) 6,043 Total $ 39,936 $ 1,250 $ (104) $ 41,082 Maintaining investment quality is a primary objective of the Company’s investment policy which, subject to certain limited exceptions, prohibits the purchase of any investment security below a Moody’s Investor’s Service or Standard & Poor’s rating of “A.” At September 30, 2020, 43.5% of the portfolio was rated “AAA” as compared to 53.4% at December 31, 2019. Approximately 14.8% of the portfolio was either rated below “A” or unrated at September 30, 2020 as compared to 9.1% at December 31, 2019. The Company sold no AFS securities during the third quarter or first nine months of 2020. Total proceeds from the sale of AFS securities for the third quarter and first nine months of 2019 were $2.8 million and $3.4 million, respectively, resulting in $88,000 and $118,000, respectively, of gross investment security gains. The carrying value of securities, both available for sale and held to maturity, pledged to secure public and trust deposits was $113,126,000 at September 30, 2020 and $117,076,000 at December 31, 2019. The following tables present information concerning investments with unrealized losses as of September 30, 2020 and December 31, 2019 (in thousands): Total investment securities: SEPTEMBER 30, 2020 LESS THAN 12 MONTHS 12 MONTHS OR LONGER TOTAL FAIR UNREALIZED FAIR UNREALIZED FAIR UNREALIZED VALUE LOSSES VALUE LOSSES VALUE LOSSES U.S. Agency $ — $ — $ — $ — $ — $ — U.S. Agency mortgage-backed securities 1,438 (5) 138 (1) 1,576 (6) Municipal 1,044 (1) 752 (50) 1,796 (51) Corporate bonds and other securities 15,741 (259) 6,859 (141) 22,600 (400) Total $ 18,223 $ (265) $ 7,749 $ (192) $ 25,972 $ (457) Total investment securities: DECEMBER 31, 2019 LESS THAN 12 MONTHS 12 MONTHS OR LONGER TOTAL FAIR UNREALIZED FAIR UNREALIZED FAIR UNREALIZED VALUE LOSSES VALUE LOSSES VALUE LOSSES U.S. Agency $ — $ — $ — $ — $ — $ — U.S. Agency mortgage-backed securities 7,084 (23) 8,562 (75) 15,646 (98) Municipal 2,269 (18) 1,123 (52) 3,392 (70) Corporate bonds and other securities 7,797 (85) 11,783 (243) 19,580 (328) Total $ $ (126) $ $ (370) $ 38,618 $ (496) The unrealized losses are primarily a result of increases in market yields from the time of purchase. In general, as market yields rise, the value of securities will decrease; as market yields fall, the fair value of securities will increase. There are 35 positions that are considered temporarily impaired at September 30, 2020. Management generally views changes in fair value caused by changes in interest rates as temporary; therefore, these securities have not been classified as other-than-temporarily impaired. Management has also concluded that based on current information we expect to continue to receive scheduled interest payments as well as the entire principal balance. Furthermore, management does not intend to sell these securities and does not believe it will be required to sell these securities before they recover in value or mature. The interest rate environment and market yields can also have a significant impact on the yield earned on mortgage-backed securities (MBS). Prepayment speed assumptions are an important factor to consider when evaluating the returns on an MBS. Generally, as interest rates decline, borrowers have more incentive to refinance into a lower rate, so prepayments will rise. Conversely, as interest rates increase, prepayments will decline. When an MBS is purchased at a premium, the yield will decrease as prepayments increase and the yield will increase as prepayments decrease. As of September 30, 2020, the Company had low premium risk as the book value of our mortgage-backed securities purchased at a premium was only 101.4% of the par value. Contractual maturities of securities at September 30, 2020 are shown below (in thousands). Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without prepayment penalties. The weighted average duration of the total investment securities portfolio at September 30, 2020 is 20.3 months and is lower than the duration at December 31, 2019 which was 36.9 months. The duration remains within our internally established guideline to not exceed 60 months which we believe is appropriate to maintain proper levels of liquidity, interest rate risk, market valuation sensitivity and profitability. Total investment securities: September 30, 2020 Available for sale Held to maturity Cost Basis Fair Value Cost Basis Fair Value Within 1 year $ 5,060 $ 5,093 $ 3,400 $ 3,403 After 1 year but within 5 years 22,222 22,536 7,629 8,054 After 5 years but within 10 years 48,851 50,395 17,115 18,607 After 10 years but within15 years 19,253 20,120 9,395 9,946 Over 15 years 41,886 43,572 5,097 5,298 Total $ 137,272 $ 141,716 $ 42,636 $ 45,308 As of September 30, 2020 and December 31, 2019, the Company reported $424,000 and $366,000, respectively, of equity securities within other assets on the Consolidated Balance Sheets. These equity securities are held within a nonqualified deferred compensation plan in which a select group of executives of the Company can participate. An eligible executive can defer a certain percentage of their current salary to be placed into the plan and held within a rabbi trust. The assets of the rabbi trust are invested in various publicly listed mutual funds. The gain or loss on the equity securities (both realized and unrealized) is reported within other income on the Consolidated Statements of Operations. During the periods presented, the Company recorded both realized and unrealized gains/losses related to the equity securities. The amounts of such gains/losses were immaterial to the Consolidated Financial Statements. Additionally, the Company has recognized a deferred compensation liability, which is equal to the balance of the equity securities and is reported within other liabilities on the Consolidated Balance Sheets. |
Loans
Loans | 9 Months Ended |
Sep. 30, 2020 | |
Loans | |
Loans | 8. Loans The loan portfolio of the Company consists of the following (in thousands): September 30, 2020 December 31, 2019 Commercial: Commercial and industrial $ 152,636 $ 173,922 Paycheck Protection Program (PPP) 68,460 — Commercial loans secured by owner occupied real estate 90,819 91,655 Commercial loans secured by non-owner occupied real estate 378,858 363,635 Real estate − residential mortgage 233,811 235,239 Consumer 17,196 18,255 Loans, net of unearned income $ 941,780 $ Loan balances at September 30, 2020 and December 31, 2019 are net of unearned income of $1,466,000 and $384,000, respectively. The unearned income balance at September 30, 2020 includes $1,057,000 of unrecognized fee income from the PPP loan originations. Real estate construction loans comprised 6.4% and 4.9% of total loans, net of unearned income at September 30, 2020 and December 31, 2019, respectively. The third quarter of 2020 represented the second full quarter’s impact of the COVID-19 pandemic. Certain loans within our commercial and commercial real estate portfolios have been disproportionately adversely affected by the pandemic. Due to mandatory lockdowns and travel restrictions, certain industries, such as hospitality, travel, food service and restaurants and bars, have suffered as a result of COVID-19. The following table provides information regarding our potential COVID-19 risk concentrations for commercial and commercial real estate loans by industry type at September 30, 2020 (in thousands). Paycheck Commercial loans Commercial loans Commercial Protection secured by owner secured by non-owner and industrial Program occupied real estate occupied real estate Total 1-4 unit residential $ 1,488 $ — $ 107 $ 5,920 $ 7,515 Multifamily/apartments/student housing — — 418 54,963 55,381 Office 32,793 9,924 10,075 34,452 87,244 Retail 7,997 1,786 21,213 116,830 147,826 Industrial/manufacturing/warehouse 89,382 29,463 17,751 43,093 179,689 Hotels 372 1,287 — 41,830 43,489 Eating and drinking places 855 13,630 4,424 538 19,447 Amusement and recreation 245 106 3,345 46 3,742 Mixed use — — 2,802 66,435 69,237 Other 19,504 12,264 30,684 14,751 77,203 Total $ 152,636 $ 68,460 $ 90,819 $ 378,858 $ 690,773 Paycheck Protection Program The Coronavirus Aid, Relief, and Economic Security Act, or CARES Act, was signed into law on March 27, 2020, and provides emergency economic relief to individuals and businesses impacted by the COVID-19 pandemic. The CARES Act authorized the Small Business Administration (SBA) to temporarily guarantee loans under a new 7(a) program called the Paycheck Protection Program (PPP). As a qualified SBA lender, the Company was automatically authorized to originate PPP loans. An eligible business could apply for a PPP loan up to the lesser of: (1) 2.5 times its average monthly “payroll costs;” or (2) $10.0 million. PPP loans have: (a) an interest rate of 1.0%, (b) a two-year (if originated prior to June 5, 2020) or five-year (if originated after June 5, 2020) loan term to maturity; and (c) principal and interest payments deferred for six months from the date of disbursement. The SBA will guarantee 100% of the PPP loans made to eligible borrowers pursuant to standards as defined by the SBA. The entire principal amount of the borrower’s PPP loan, including any accrued interest, is eligible to be reduced by the loan forgiveness amount under the PPP so long as employee and compensation levels of the business are maintained and at least 60% of the loan proceeds are used for payroll expenses, with the remaining loan proceeds being used for other qualifying expenses such as interest on mortgages, rent, and utilities. As of September 30, 2020, the Company had 469 PPP loans outstanding totaling $68.5 million and has recorded a total of $1.4 million of processing fee income and interest income from PPP lending activity. Also, there is approximately $1.1 million of PPP processing fees that will be amortized into income over the time period that the loans remain on our balance sheet or until the PPP loan is forgiven at which time the remaining fee will be recognized immediately as income. |
Allowance for Loan Losses
Allowance for Loan Losses | 9 Months Ended |
Sep. 30, 2020 | |
Allowance for Loan Losses | |
Allowance for Loan Losses | 9. Allowance for Loan Losses The following tables summarize the rollforward of the allowance for loan losses by portfolio segment for the three and nine month periods ending September 30, 2020 and 2019 (in thousands). Three months ended September 30, 2020 Balance at Charge- Provision Balance at June 30, 2020 Offs Recoveries (Credit) September 30, 2020 Commercial $ 3,784 $ (111) $ 1 $ (638) $ 3,036 Commercial loans secured by non-owner occupied real estate 3,619 — 10 1,261 4,890 Real estate-residential mortgage 1,216 (19) 24 4 1,225 Consumer 119 (14) 19 (4) 120 Allocation for general risk 961 — — 52 1,013 Total $ 9,699 $ (144) $ 54 $ 675 $ 10,284 Three months ended September 30, 2019 Balance at Charge- Provision Balance at June 30, 2019 Offs Recoveries (Credit) September 30, 2019 Commercial $ 2,538 $ (1) $ 8 $ 464 $ 3,009 Commercial loans secured by non-owner occupied real estate 3,425 — 12 (81) 3,356 Real estate-residential mortgage 1,218 — 25 (46) 1,197 Consumer 124 (36) 10 28 126 Allocation for general risk 797 — — (140) 657 Total $ 8,102 $ (37) $ 55 $ 225 $ 8,345 Nine months ended September 30, 2020 Balance at Charge- Provision Balance at December 31, 2019 Offs Recoveries (Credit) September 30, 2020 Commercial $ 3,951 $ (111) $ 1 $ (805) $ 3,036 Commercial loans secured by non-owner occupied real estate 3,119 — 31 1,740 4,890 Real estate-residential mortgage 1,159 (201) 46 221 1,225 Consumer 126 (105) 44 55 120 Allocation for general risk 924 — — 89 1,013 Total $ 9,279 $ (417) $ 122 $ 1,300 $ 10,284 Nine months ended September 30, 2019 Balance at Charge- Provision Balance at December 31, 2018 Offs Recoveries (Credit) September 30, 2019 Commercial $ 3,057 $ (1) $ 13 $ (60) $ 3,009 Commercial loans secured by non-owner occupied real estate 3,389 (63) 36 (6) 3,356 Real estate-residential mortgage 1,235 (71) 101 (68) 1,197 Consumer 127 (206) 40 165 126 Allocation for general risk 863 — — (206) 657 Total $ 8,671 $ (341) $ 190 $ (175) $ 8,345 The Company recorded a $675,000 provision expense for loan losses in the third quarter of 2020 compared to a $225,000 provision recorded in the third quarter of 2019. For the first nine months of 2020, the Company recorded a $1,300,000 provision expense for loan losses compared to a $175,000 provision recovery recorded in the first nine months of 2019, which represents a net unfavorable shift of $1,475,000. The Company continues to build the allowance for loan losses given the overall economic climate and the uncertainty that exists because of the COVID-19 pandemic. The 2020 provision reflects management’s decision to strengthen certain qualitative factors within our allowance for loan losses calculation as well as the third quarter rating downgrade of several loans totaling approximately $29 million from the hotel industry into the special mention risk rating. The effect of these downgrades was an increase in the allowance for the commercial loans secured by non-owner occupied real estate portfolio for both the three and nine months ended September 30, 2020. The hotel industry has been especially negatively impacted from the pandemic and is demonstrating a slow pace of recovery from the economic lockdown. While we anticipate that our hotel borrowers will need additional time to recover, we remain encouraged by their signs of increasing occupancy rates. The decrease in the allowance balance for the commercial loan portfolio is the result of two substantial commercial loans which were previously classified as substandard being upgraded and the pay off of another troubled commercial loan. In addition, the growth in the allowance balance for residential mortgage loans is the result of the increased origination activity experienced within this portfolio given the lower interest rate environment. It should be noted that the 100% SBA guarantee on PPP loans minimizes the level of credit risk associated with the loans. As a result, such loans are assigned a 0% risk weight for purposes of calculating the Bank’s risk-based capital ratios. Therefore, it was deemed appropriate to not allocate any portion of the loan loss reserve for the PPP loans. For the first nine months of 2020, the Company experienced net loan charge-offs of $295,000, or 0.04% of total loans, compared to net loan charge-offs of $151,000, or 0.02% of total loans, in the first nine months of 2019. Overall, the Company’s asset quality remains strong as its non-performing assets totaled $2.6 million, or only 0.27% of total loans, at September 30, 2020. The allowance for loan losses provided 395% coverage of non-performing assets, and 1.08% of total loans, at September 30, 2020, compared to 397% coverage of non-performing assets, and 1.05% of total loans, at December 31, 2019. The reserve coverage of total loans, excluding PPP loans, is 1.17% (non-GAAP) at September 30, 2020. See the reconciliation of the non-GAAP measure of the reserve coverage of total loans, excluding PPP loans, within the Allowance for Loan Losses section of the MD&A. The following tables summarize the loan portfolio and allowance for loan loss by the primary segments of the loan portfolio (in thousands). At September 30, 2020 Commercial Loans Secured by Non-Owner Real Estate- Occupied Residential Allocation for Commercial Real Estate Mortgage Consumer General Risk Total Loans: Individually evaluated for impairment $ 859 $ 8 $ — $ — $ 867 Collectively evaluated for impairment 311,056 378,850 233,811 17,196 940,913 Total loans $ 311,915 $ 378,858 $ 233,811 $ 17,196 $ 941,780 Allowance for loan losses: Specific reserve allocation $ 98 $ 8 $ — $ — $ — $ 106 General reserve allocation 2,938 4,882 1,225 120 1,013 10,178 Total allowance for loan losses $ 3,036 $ 4,890 $ 1,225 $ 120 $ 1,013 $ 10,284 At December 31, 2019 Commercial Loans Secured by Non-Owner Real Estate- Occupied Residential Allocation for Commercial Real Estate Mortgage Consumer General Risk Total Loans: Individually evaluated for impairment $ 816 $ 8 $ — $ — $ 824 Collectively evaluated for impairment 264,761 363,627 235,239 18,255 881,882 Total loans $ 265,577 $ 363,635 $ 235,239 $ 18,255 $ 882,706 Allowance for loan losses: Specific reserve allocation $ 84 $ 8 $ — $ — $ — $ 92 General reserve allocation 3,867 3,111 1,159 126 924 9,187 Total allowance for loan losses $ 3,951 $ 3,119 $ 1,159 $ 126 $ 924 $ 9,279 The segments of the Company’s loan portfolio are disaggregated into classes that allows management to monitor risk and performance. The loan classes used are consistent with the internal reports evaluated by the Company’s management and Board of Directors to monitor risk and performance within various segments of its loan portfolio. The commercial loan segment includes both the commercial and industrial and the owner occupied commercial real estate loan classes while the remaining segments are not separated into classes as management monitors risk in these loans at the segment level. The residential mortgage loan segment is comprised of first lien amortizing residential mortgage loans and home equity loans secured by residential real estate. The consumer loan segment consists primarily of installment loans and overdraft lines of credit connected with customer deposit accounts. Management evaluates for possible impairment any individual loan in the commercial or commercial real estate segment that is in nonaccrual status or classified as a Troubled Debt Restructure (TDR). In addition, consumer and residential mortgage loans with a balance of $150,000 or more are evaluated for impairment. Loans are considered to be impaired when, based on current information and events, it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in evaluating impairment include payment status, collateral value, and the probability of collecting scheduled principal and interest payments when due. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed. Once the determination has been made that a loan is impaired, the determination of whether a specific allocation of the allowance is necessary is measured by comparing the recorded investment in the loan to the fair value of the loan using one of three methods: (a) the present value of expected future cash flows discounted at the loan’s effective interest rate; (b) the loan’s observable market price; or (c) the fair value of the collateral less selling costs for collateral dependent loans. The method is selected on a loan-by-loan basis, with management primarily utilizing either the discounted cash flows or the fair value of collateral method. The evaluation of the need and amount of a specific allocation of the allowance and whether a loan can be removed from impairment status is made on a quarterly basis. The Company’s policy for recognizing interest income on impaired loans does not differ from its overall policy for interest recognition. The need for an updated appraisal on collateral dependent loans is determined on a case-by-case basis. The useful life of an appraisal or evaluation will vary depending upon the circumstances of the property and the economic conditions in the marketplace. A new appraisal is not required if there is an existing appraisal which, along with other information, is sufficient to determine a reasonable value for the property and to support an appropriate and adequate allowance for loan losses. At a minimum, annual documented reevaluation of the property is completed by the Bank’s internal Assigned Risk Department to support the value of the property. When reviewing an appraisal associated with an existing real estate collateral dependent transaction, the Bank’s internal Assigned Risk Department must determine if there have been material changes to the underlying assumptions in the appraisal which affect the original estimate of value. Some of the factors that could cause material changes to reported values include: · the passage of time; · the volatility of the local market; · the availability of financing; · natural disasters; · the inventory of competing properties; · new improvements to, or lack of maintenance of, the subject property or competing properties upon physical inspection by the Bank; · changes in underlying economic and market assumptions, such as material changes in current and projected vacancy, absorption rates, capitalization rates, lease terms, rental rates, sales prices, concessions, construction overruns and delays, zoning changes, etc.; and/or · environmental contamination. The value of the property is adjusted to appropriately reflect the above listed factors and the value is discounted to reflect the value impact of a forced or distressed sale, any outstanding senior liens, any outstanding unpaid real estate taxes, transfer taxes and closing costs that would occur with sale of the real estate. If the Assigned Risk Department personnel determine that a reasonable value cannot be derived based on available information, a new appraisal is ordered. The determination of the need for a new appraisal, versus completion of a property valuation by the Bank’s Assigned Risk Department personnel, rests with the Assigned Risk Department and not the originating account officer. The following tables present impaired loans by portfolio segment, segregated by those for which a specific allowance was required and those for which a specific allowance was not necessary. At September 30, 2020 IMPAIRED LOANS WITH IMPAIRED LOANS WITH NO SPECIFIC SPECIFIC ALLOWANCE ALLOWANCE TOTAL IMPAIRED LOANS UNPAID RECORDED RELATED RECORDED RECORDED PRINCIPAL INVESTMENT ALLOWANCE INVESTMENT INVESTMENT BALANCE (IN THOUSANDS) Commercial $ 859 $ 98 $ — $ 859 $ 859 Commercial loans secured by non-owner occupied real estate 8 8 — 8 30 Total impaired loans $ 867 $ 106 $ — $ 867 $ 889 At December 31, 2019 IMPAIRED LOANS WITH IMPAIRED LOANS WITH NO SPECIFIC SPECIFIC ALLOWANCE ALLOWANCE TOTAL IMPAIRED LOANS UNPAID RECORDED RELATED RECORDED RECORDED PRINCIPAL INVESTMENT ALLOWANCE INVESTMENT INVESTMENT BALANCE (IN THOUSANDS) Commercial 816 $ 84 $ — $ 816 $ 816 Commercial loans secured by non-owner occupied real estate $ 8 $ 8 $ — $ 8 $ 30 Total impaired loans $ 824 $ 92 $ — $ 824 $ 846 The following table presents the average recorded investment in impaired loans and related interest income recognized for the periods indicated (in thousands). Three months ended Nine months ended September 30, September 30, 2020 2019 2020 2019 Average impaired balance: Commercial $ 839 $ 785 $ 832 $ 393 Commercial loans secured by non-owner occupied real estate 8 10 8 10 Average investment in impaired loans $ 847 $ 795 $ 840 $ 403 Interest income recognized: Commercial $ 9 $ 13 $ 31 $ 17 Commercial loans secured by non-owner occupied real estate — — — — Interest income recognized on a cash basis on impaired loans $ 9 $ 13 $ 31 $ 17 Management uses a nine-point internal risk rating system to monitor the credit quality of the overall loan portfolio. The first six categories are considered not criticized. The first five “Pass” categories are aggregated, while the Pass‑6, Special Mention, Substandard and Doubtful categories are disaggregated to separate pools. The criticized rating categories utilized by management generally follow bank regulatory definitions. The Special Mention category includes assets that are currently protected but are potentially weak, resulting in an undue and unwarranted credit risk, but not to the point of justifying a Substandard classification. Loans in the Substandard category have well-defined weaknesses that jeopardize the liquidation of the debt, and have a distinct possibility that some loss will be sustained if the weaknesses are not corrected. All loans greater than 90 days past due, or for which any portion of the loan represents a specific allocation of the allowance for loan losses are placed in Substandard or Doubtful. To help ensure that risk ratings are accurate and reflect the present and future capacity of borrowers to repay a loan as agreed, the Company has a structured loan rating process, which dictates that, at a minimum, credit reviews are mandatory for all commercial and commercial mortgage loan relationships with aggregate balances in excess of $1,000,000 within a 12‑month period. Generally, consumer and residential mortgage loans are included in the Pass categories unless a specific action, such as bankruptcy, delinquency, or death occurs to raise awareness of a possible credit event. The Company’s commercial relationship managers are responsible for the timely and accurate risk rating of the loans in their portfolios at origination and on an ongoing basis. Risk ratings are assigned by the account officer, but require independent review and rating concurrence from the Company’s internal Loan Review Department. The Loan Review Department is an experienced, independent function which reports directly to the Board’s Audit Committee. The scope of commercial portfolio coverage by the Loan Review Department is defined and presented to the Audit Committee for approval on an annual basis. The approved scope of coverage for 2020 requires review of a minimum of 40% of the commercial loan portfolio. In addition to loan monitoring by the account officer and Loan Review Department, the Company also requires presentation of all credits rated Pass‑6 with aggregate balances greater than $2,000,000, all credits rated Special Mention or Substandard with aggregate balances greater than $250,000, and all credits rated Doubtful with aggregate balances greater than $100,000 on an individual basis to the Company’s Loan Loss Reserve Committee on a quarterly basis. Additionally, the Asset Quality Task Force, which is a group comprised of senior level personnel, meets monthly to monitor the status of problem loans. The following table presents the classes of the commercial and commercial real estate loan portfolios summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system. At September 30, 2020 SPECIAL PASS MENTION SUBSTANDARD DOUBTFUL TOTAL (IN THOUSANDS) Commercial and industrial $ 142,948 $ 6,336 $ 3,352 $ — $ 152,636 Paycheck Protection Program (PPP) 68,460 — — — 68,460 Commercial loans secured by owner occupied real estate 87,844 1,889 1,086 — 90,819 Commercial loans secured by non-owner occupied real estate 349,901 27,472 1,477 8 378,858 Total $ 649,153 $ 35,697 $ 5,915 $ 8 $ 690,773 At December 31, 2019 SPECIAL PASS MENTION SUBSTANDARD DOUBTFUL TOTAL (IN THOUSANDS) Commercial and industrial $ 161,147 $ 853 $ 11,922 $ — $ 173,922 Commercial loans secured by owner occupied real estate 88,942 1,384 1,329 — 91,655 Commercial loans secured by non-owner occupied real estate 362,027 — 1,600 8 363,635 Total $ 612,116 $ 2,237 $ 14,851 $ 8 $ 629,212 It is generally the policy of the Bank that the outstanding balance of any residential mortgage loan that exceeds 90‑days past due as to principal and/or interest is transferred to non-accrual status and an evaluation is completed to determine the fair value of the collateral less selling costs, unless the balance is minor. A charge down is recorded for any deficiency balance determined from the collateral evaluation. The remaining non-accrual balance is reported as impaired with no specific allowance. It is generally the policy of the Bank that the outstanding balance of any consumer loan that exceeds 90‑days past due as to principal and/or interest is charged off. The following tables present the performing and non-performing outstanding balances of the residential and consumer portfolio classes. At September 30, 2020 NON- PERFORMING PERFORMING TOTAL (IN THOUSANDS) Real estate – residential mortgage $ 232,115 $ 1,696 $ 233,811 Consumer 17,196 — 17,196 Total $ 249,311 $ 1,696 $ 251,007 At December 31, 2019 NON- PERFORMING PERFORMING TOTAL (IN THOUSANDS) Real estate – residential mortgage $ 233,760 $ 1,479 $ 235,239 Consumer 18,255 — 18,255 Total $ 252,015 $ 1,479 $ 253,494 Management further monitors the performance and credit quality of the loan portfolio by analyzing the age of the portfolio as determined by the length of time a recorded payment is past due. The following tables present the classes of the loan portfolio summarized by the aging categories of performing loans and non-accrual loans. At September 30, 2020 90 DAYS 30 – 59 60 – 89 PAST DUE DAYS DAYS 90 DAYS TOTAL TOTAL AND STILL CURRENT PAST DUE PAST DUE PAST DUE PAST DUE LOANS ACCRUING (IN THOUSANDS) Commercial and industrial $ 152,558 $ 78 $ — $ — $ 78 $ 152,636 $ — Paycheck Protection Program (PPP) 68,460 — — — — 68,460 $ — Commercial loans secured by owner occupied real estate 90,819 — — — — 90,819 — Commercial loans secured by non-owner occupied real estate 378,858 — — — — 378,858 — Real estate – residential mortgage 229,851 1,922 1,039 999 3,960 233,811 — Consumer 17,156 40 — — 40 17,196 — Total $ 937,702 $ 2,040 $ 1,039 $ 999 $ 4,078 $ 941,780 $ — At December 31, 2019 90 DAYS 30 – 59 60 – 89 PAST DUE DAYS DAYS 90 DAYS TOTAL TOTAL AND STILL CURRENT PAST DUE PAST DUE PAST DUE PAST DUE LOANS ACCRUING (IN THOUSANDS) Commercial and industrial $ 173,922 $ — $ — $ — $ — $ 173,922 $ — Commercial loans secured by owner occupied real estate 91,538 117 — — 117 91,655 — Commercial loans secured by non-owner occupied real estate 363,635 — — — — 363,635 — Real estate – residential mortgage 231,022 2,331 864 1,022 4,217 235,239 — Consumer 18,190 42 23 — 65 18,255 — Total $ 878,307 $ 2,490 $ 887 $ 1,022 $ 4,399 $ 882,706 $ — An allowance for loan losses (“ALL”) is maintained to support loan growth and cover charge-offs from the loan portfolio. The ALL is based on management’s continuing evaluation of the risk characteristics and credit quality of the loan portfolio, assessment of current economic conditions, diversification and size of the portfolio, adequacy of collateral, past and anticipated loss experience, and the amount of non-performing loans. Loans that are collectively evaluated for impairment are analyzed with general allowances being made as appropriate. For general allowances, historical loss trends are used in the estimation of losses in the current portfolio. These historical loss amounts are complemented by consideration of other qualitative factors. Management tracks the historical net charge-off activity at each risk rating grade level for the entire commercial portfolio and at the aggregate level for the consumer, residential mortgage and small business portfolios. A historical charge-off factor is calculated utilizing a rolling 12 consecutive historical quarters for the commercial portfolios. This historical charge-off factor for the consumer, residential mortgage and small business portfolios are based on a three-year historical average of actual loss experience. The Company uses a comprehensive methodology and procedural discipline to maintain an ALL to absorb inherent losses in the loan portfolio. The Company believes this is a critical accounting policy since it involves significant estimates and judgments. The allowance consists of three elements: (1) an allowance established on specifically identified problem loans, (2) formula driven general reserves established for loan categories based upon historical loss experience and other qualitative factors which include delinquency, non-performing and TDR loans, loan trends, economic trends, concentrations of credit, trends in loan volume, experience and depth of management, examination and audit results, effects of any changes in lending policies, and trends in policy, financial information, and documentation exceptions, and (3) a general risk reserve which provides support for variance from our assessment of the previously listed qualitative factors, provides protection against credit risks resulting from other inherent risk factors contained in the Company’s loan portfolio, and recognizes the model and estimation risk associated with the specific and formula driven allowances. The qualitative factors used in the formula driven general reserves are evaluated quarterly (and revised if necessary) by the Company’s management to establish allocations which accommodate each of the listed risk factors. “Pass” rated credits are segregated from “Criticized” and “Classified” credits for the application of qualitative factors. Management reviews the loan portfolio on a quarterly basis using a defined, consistently applied process in order to make appropriate and timely adjustments to the ALL. When information confirms all or part of specific loans to be uncollectible, these amounts are promptly charged off against the ALL. |
Non-Performing Assets Including
Non-Performing Assets Including Troubled Debt Restructurings (TDR) | 9 Months Ended |
Sep. 30, 2020 | |
Non-Performing Assets Including Troubled Debt Restructurings (TDR) | |
Non-Performing Assets Including Troubled Debt Restructurings (TDR) | 10. Non-Performing Assets Including Troubled Debt Restructurings (TDR) The following table presents information concerning non-performing assets including TDR (in thousands, except percentages): September 30, 2020 December 31, 2019 Non-accrual loans: Commercial and industrial $ 20 $ — Commercial loans secured by non-owner occupied real estate 8 8 Real estate – residential mortgage 1,696 1,479 Total 1,724 1,487 Other real estate owned: Real estate – residential mortgage 40 37 Total 40 37 TDR’s not in non-accrual: Commercial and industrial 839 815 Total 839 815 Total non-performing assets including TDR $ 2,603 $ 2,339 Total non-performing assets as a percent of loans, net of unearned income, and other real estate owned 0.27 % 0.26 % The Company had no loans past due 90 days or more for the periods presented which were accruing interest. The following table sets forth, for the periods indicated, (1) the gross interest income that would have been recorded if non-accrual loans had been current in accordance with their original terms and had been outstanding throughout the period or since origination if held for part of the period, (2) the amount of interest income actually recorded on such loans, and (3) the net reduction in interest income attributable to such loans (in thousands). Three months ended Nine months ended September 30, September 30, 2020 2019 2020 2019 Interest income due in accordance with original terms $ 22 $ 14 $ 60 $ 43 Interest income recorded — — — — Net reduction in interest income $ 22 $ 14 $ 60 $ 43 Consistent with accounting and regulatory guidance, the Bank recognizes a TDR when the Bank, for economic or legal reasons related to a borrower’s financial difficulties, grants a concession to the borrower that would not normally be considered. Regardless of the form of concession granted, the Bank’s objective in offering a TDR is to increase the probability of repayment of the borrower’s loan. The following table details the loan modified as a TDR during the three month period ending September 30, 2020 (dollars in thousands). Loans in accrual status # of Loans Current Balance Concession Granted Commercial and industrial 1 $ 47 Extension of maturity date with a below market interest rate The following table details the loans modified as TDR’s during the nine month period ended September 30, 2020 (dollars in thousands). Loans in accrual status # of Loans Current Balance Concession Granted Commercial and industrial 1 $ 750 Subsequent modification of a TDR - Extension of maturity date with a below market interest rate Commercial and industrial 1 47 Extension of maturity date with a below market interest rate The following table details the loan modified as a TDR during the three month period ended September 30, 2019 (dollars in thousands). Loans in accrual status # of Loans Current Balance Concession Granted Commercial and industrial 1 $ 70 Extension of maturity date with a below market interest rate The following table details the loans modified as TDR’s during the nine month period ended September 30, 2019 (dollars in thousands). Loans in accrual status # of Loans Current Balance Concession Granted Commercial and industrial 2 $ 820 Extension of maturity date with a below market interest rate All TDRs are individually evaluated for impairment and a related allowance is recorded, as needed. The specific ALL reserve for loans modified as TDRs was $104,000 and $92,000 as of September 30, 2020 and December 31, 2019, respectively. The Company had no loans that were classified as TDRs or were subsequently modified during each 12-month period prior to the current reporting periods, which begin January 1, 2019 and 2018 (nine month periods) and July 1, 2019 and 2018 (three month periods), respectively, and that subsequently defaulted during these reporting periods. The Company is unaware of any additional loans which are required to either be charged-off or added to the non-performing asset totals disclosed above. Loan Modifications Related to COVID-19 Under section 4013 of the CARES Act, loans less than 30 days past due as of December 31, 2019 will be considered current for COVID-19 modifications. A financial institution can then suspend the requirements under GAAP for loan modifications related to COVID-19 that would otherwise be categorized as a TDR, and suspend any determination of a loan modified as a result of COVID-19 as being a TDR, including the requirement to determine impairment for accounting purposes and reporting the loan as past due. Financial institutions wishing to utilize this authority must make a policy election, which applies to any COVID-19 modification made between March 1, 2020 and the earlier of either December 31, 2020 or the 60th day after the end of the COVID-19 national emergency so long as the loan was current on payments as of December 31, 2019. Similarly, the Financial Accounting Standards Board has confirmed that short-term modifications made on a good-faith basis in response to COVID-19 to loan customers who were current prior to any relief are not TDRs. In response to the COVID-19 pandemic, the Company has prudently executed loan modifications for existing loan customers. The following table presents information comparing loans which were subject to a loan modification related to COVID-19, as of September 30, 2020 and June 30, 2020. Note that the percentage of outstanding loans presented below was calculated based on loan totals excluding PPP loans. Management believes that this method more accurately reflects the concentration of COVID-19 related modifications within the loan portfolio. At September 30, 2020 At June 30, 2020 % of Outstanding % of Outstanding Balance Non-PPP Loans Balance Non-PPP Loans (in thousands) (in thousands) CRE/Commercial $ 140,132 21.8 % $ 190,276 30.4 % Home Equity/Consumer 160 0.2 5,890 6.0 Residential Mortgage 4,069 2.9 3,839 2.8 Total $ 144,361 16.4 $ 200,005 23.2 The balance of loan modifications related to COVID-19 at September 30, 2020 represents a decrease of $55.6 million, or 27.8%, from the balance of loans modified for COVID-19 reported in the second quarter 2020 10-Q which totaled $200 million. Additionally, the balance of loan modifications related to COVID-19 decreased further as of October 31, 2020 and totaled $80.9 million. This represents a decrease of $63.4 million, or 43.9%, from the September 30, 2020 balance. As a result of these loan modifications, the Company has recorded $2.4 million of accrued interest income that has not been received as of September 30, 2020. Requested modifications primarily consist of the deferral of principal and/or interest payments for a period of three to six months and maturity date extensions. The following table presents the composition of the types of payment relief that have been granted. At September 30, 2020 At June 30, 2020 Number of Loans Balance Number of Loans Balance (in thousands) (in thousands) Type of Payment Relief Interest only payments 67 $ 74,680 83 $ 87,881 Complete payment deferrals 127 69,681 296 103,378 Maturity date extensions — — 4 8,746 Total 194 $ 144,361 383 $ 200,005 Management is carefully monitoring asset quality with a particular focus on customers that have requested payment deferrals during this difficult economic time. The Asset Quality Task Force is meeting monthly to review these particular relationships, receiving input from the business lenders regarding their ongoing discussions with the borrowers. It is expected that a significant number of the remaining loans with payment modifications will return to normal payment status during the fourth quarter of 2020. Deferral extension requests will be considered based upon the customer’s needs and their impacted industry, borrower and guarantor capacity to service debt, and current as well as any additional regulatory guidance. As of September 30, 2020, the Company has granted one deferral extension request related to a $2.5 million commercial real estate loan within the hotel industry. The additional deferral period, three months of principal and interest payments, was approved in conjunction with an SBA program that will allow the borrower to receive payment relief on a separate SBA 504 Debenture which holds a second lien position on the collateral securing the Company’s loan. In order to properly reflect the increased credit risk, the loan has been downgraded into the special mention risk rating. |
Short-Term and Federal Home Loa
Short-Term and Federal Home Loan Bank Borrowings | 9 Months Ended |
Sep. 30, 2020 | |
Short-Term and Federal Home Loan Bank Borrowing | |
Short-Term and Federal Home Loan Bank Borrowings | 11. Short-Term and Federal Home Loan Bank Borrowings Total short-term and Federal Home Loan Bank (FHLB) borrowings and advances consist of the following (in thousands, except percentages): At September 30, 2020 Weighted Type Maturing Amount Average Rate Federal Funds Purchased Overnight $ 2,000 0.65 % Open Repo Plus Overnight 3,894 0.39 FHLB Advances 2020 11,187 0.95 2021 22,496 1.08 2022 20,888 2.03 2023 15,568 1.59 2024 4,197 1.19 Total FHLB advances 74,336 1.44 Total short-term and FHLB borrowings $ 80,230 1.37 % At December 31, 2019 Weighted Type Maturing Amount Average Rate Open Repo Plus Overnight $ 22,412 1.81 % FHLB Advances 2020 18,729 1.75 2021 9,496 2.28 2022 17,838 2.21 2023 5,568 2.48 2024 2,037 1.86 Total FHLB advances 53,668 2.08 Total short-term and FHLB borrowings $ 76,080 2.00 % The rate on Open Repo Plus advances can change daily, while the rates on the advances are fixed until the maturity of the advance. All FHLB stock along with an interest in certain residential mortgage, commercial real estate, and commercial and industrial loans with an aggregate statutory value equal to the amount of the advances are pledged as collateral to the FHLB of Pittsburgh to support these borrowings. |
Lease Commitments
Lease Commitments | 9 Months Ended |
Sep. 30, 2020 | |
Lease Commitments | |
Lease Commitments | 12. Lease Commitments The Company has operating and financing leases for several office locations and equipment. Several assumptions and judgments were made when applying the requirements of ASU 2016-02, Leases (Topic 842) to the Company's lease commitments, including the allocation of consideration in the contracts between lease and non-lease components, determination of the lease term, and determination of the discount rate used in calculating the present value of the lease payments. Many of our leases include both lease (e.g., minimum rent payments) and non-lease components, such as common area maintenance charges, utilities, real estate taxes, and insurance. The Company has elected to account for the variable non-lease components separately from the lease component. Such variable non-lease components are reported in net occupancy expense on the Consolidated Statements of Operations when incurred. These variable non-lease components were excluded from the calculation of the present value of the remaining lease payments, therefore, they are not included in the right-of-use assets and lease liabilities reported on the Consolidated Balance Sheets. The following table presents the lease cost associated with both operating and financing leases for the three and nine month periods ending September 30, 2020 and 2019 (in thousands). Three months ended Nine months ended September 30, September 30, 2020 2019 2020 2019 Lease cost Financing lease cost: Amortization of right-of-use asset $ 68 $ 64 $ 203 $ 193 Interest expense 28 29 85 88 Operating lease cost 29 29 87 87 Total lease cost $ 125 $ 122 $ 375 $ 368 Certain of the Company's leases contain options to renew the lease after the initial term. Management considers the Company's historical pattern of exercising renewal options on leases and the performance of the leased locations, when determining whether it is reasonably certain that the leases will be renewed. If management concludes that there is reasonable certainty about the renewal option, it is included in the calculation of the remaining term of each applicable lease. The discount rate utilized in calculating the present value of the remaining lease payments for each lease was the Federal Home Loan Bank of Pittsburgh advance rate corresponding to the remaining maturity of the lease. The following table presents the weighted-average remaining lease term and discount rate for the leases outstanding at September 30, 2020 and December 31, 2019. September 30, 2020 December 31, 2019 Operating Financing Operating Financing Weighted-average remaining term (years) 11.5 16.1 11.9 17.1 Weighted-average discount rate 3.48 % 3.51 % 3.46 % 3.60 % The following table presents the undiscounted cash flows due related to operating and financing leases, along with a reconciliation to the discounted amount recorded on the Consolidated Balance Sheets (in thousands). September 30, 2020 OPERATING FINANCING Undiscounted cash flows due: Within 1 year $ 119 $ 316 After 1 year but within 2 years 110 319 After 2 years but within 3 years 69 320 After 3 years but within 4 years 69 253 After 4 years but within 5 years 69 252 After 5 years 539 2,821 Total undiscounted cash flows 975 4,281 Discount on cash flows (177) (1,120) Total lease liabilities $ 798 $ 3,161 December 31, 2019 OPERATING FINANCING Undiscounted cash flows due: Within 1 year $ 118 $ 296 After 1 year but within 2 years 120 275 After 2 years but within 3 years 98 277 After 3 years but within 4 years 69 274 After 4 years but within 5 years 69 236 After 5 years 589 3,007 Total undiscounted cash flows 1,063 4,365 Discount on cash flows (198) (1,202) Total lease liabilities $ 865 $ 3,163 Under Topic 842, the lessee can elect to not record on the Consolidated Balance Sheets a lease whose term is twelve months or less and does not include a purchase option that the lessee is reasonably certain to exercise. As of September 30, 2020, the Company had no short-term leases. As of December 31, 2019, the Company had one short-term equipment lease which it elected to not record on the Consolidated Balance Sheets. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 9 Months Ended |
Sep. 30, 2020 | |
Accumulated Other Comprehensive Loss | |
Accumulated Other Comprehensive Loss | 13. Accumulated Other Comprehensive Loss The following table presents the changes in each component of accumulated other comprehensive loss, net of tax, for the three and nine months ended September 30, 2020 and 2019 (in thousands): Three months ended September 30, 2020 Three months ended September 30, 2019 Net Net Unrealized Unrealized Gains and Gains and Losses on Defined Losses on Defined Investment Benefit Investment Benefit Securities Pension Securities Pension AFS (1) Items (1) Total (1) AFS (1) Items (1) Total (1) Beginning balance $ 3,398 $ (17,469) $ (14,071) $ 1,398 $ (13,948) $ (12,550) Other comprehensive income (loss) before reclassifications 113 (483) (370) 480 (7) 473 Amounts reclassified from accumulated other comprehensive loss — 483 483 (69) 325 256 Net current period other comprehensive income 113 — 113 411 318 729 Ending balance $ 3,511 $ (17,469) $ (13,958) $ 1,809 $ (13,630) $ (11,821) (1) Amounts in parentheses indicate debits on the Consolidated Balance Sheets. Nine months ended September 30, 2020 Nine months ended September 30, 2019 Net Net Unrealized Unrealized Gains and Gains and Losses on Defined Losses on Defined Investment Benefit Investment Benefit Securities Pension Securities Pension AFS (1) Items (1) Total (1) AFS (1) Items (1) Total (1) Beginning balance $ 1,715 $ (17,886) $ (16,171) $ (1,409) $ (12,816) $ (14,225) Other comprehensive income (loss) before reclassifications 1,796 (1,031) 765 3,311 (1,790) 1,521 Amounts reclassified from accumulated other comprehensive loss — 1,448 1,448 (93) 976 883 Net current period other comprehensive income (loss) 1,796 417 2,213 3,218 (814) 2,404 Ending balance $ 3,511 $ (17,469) $ (13,958) $ 1,809 $ (13,630) $ (11,821) (1) Amounts in parentheses indicate debits on the Consolidated Balance Sheets. The following table presents the amounts reclassified out of each component of accumulated other comprehensive loss for the three and nine months ended Septembere 30, 2020 and 2019 (in thousands): Amount reclassified from accumulated other comprehensive loss (1) For the three For the three months ended months ended Affected line item in the Details about accumulated other comprehensive loss components September 30, 2020 September 30, 2019 statement of operations Realized (gains) losses on sale of securities $ — $ (88) Net realized gains on investment securities — 19 Provision for income taxes $ — $ (69) Amortization of estimated defined benefit pension plan loss (2) $ 611 $ 412 Other expense (128) (87) Provision for income taxes $ 483 $ 325 Total reclassifications for the period $ 483 $ 256 (1) Amounts in parentheses indicate credits. (2) These accumulated other comprehensive loss components are included in the computation of net periodic benefit cost (see Note 18 for additional details). Amount reclassified from accumulated other comprehensive loss (1) For the nine For the nine months ended months ended Affected line item in the Details about accumulated other comprehensive loss components September 30, 2020 September 30, 2019 statement of operations Realized (gains) losses on sale of securities $ — $ (118) Net realized gains on investment securities — 25 Provision for income taxes $ — $ (93) Amortization of estimated defined benefit pension plan loss (2) $ 1,833 $ 1,236 Other expense (385) (260) Provision for income taxes $ 1,448 $ 976 Total reclassifications for the period $ 1,448 $ 883 (1) Amounts in parentheses indicate credits. (2) These accumulated other comprehensive loss components are included in the computation of net periodic benefit cost (see Note 18 for additional details). |
Regulatory Capital
Regulatory Capital | 9 Months Ended |
Sep. 30, 2020 | |
Regulatory Capital | |
Regulatory Capital | 14. Regulatory Capital The Company is subject to various capital requirements administered by the federal banking agencies. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company must meet specific capital guidelines that involve quantitative measures of the Company’s assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices. The Company’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s consolidated financial statements. For a more detailed discussion, see the Capital Resources section of Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A). Quantitative measures established by regulation to ensure capital adequacy require the Company to maintain minimum amounts and ratios (set forth in the table below) of total, common equity tier 1, and tier 1 capital to risk-weighted assets (as defined) and tier 1 capital to average assets. Additionally, under Basel III rules, the decision was made to opt-out of including accumulated other comprehensive income in regulatory capital. As of September 30, 2020, the Bank was categorized as “well capitalized” under the regulatory framework for prompt corrective action promulgated by the Federal Reserve. The Company believes that no conditions or events have occurred that would change this conclusion as of such date. To be categorized as well capitalized, the Bank must maintain minimum total capital, common equity tier 1 capital, tier 1 capital, and tier 1 leverage ratios as set forth in the table (in thousands, except ratios). At September 30, 2020 TO BE WELL MINIMUM CAPITALIZED REQUIRED UNDER FOR PROMPT CAPITAL CORRECTIVE ADEQUACY ACTION COMPANY BANK PURPOSES REGULATIONS* AMOUNT RATIO AMOUNT RATIO RATIO RATIO (IN THOUSANDS, EXCEPT RATIOS) Total Capital (To Risk Weighted Assets) $ 135,967 13.02 % $ 122,960 11.80 % 8.00 % 10.00 % Tier 1 Common Equity (To Risk Weighted Assets) 105,383 10.09 111,803 10.73 4.50 6.50 Tier 1 Capital (To Risk Weighted Assets) 117,282 11.23 111,803 10.73 6.00 8.00 Tier 1 Capital (To Average Assets) 117,282 9.39 111,803 9.05 4.00 5.00 At December 31, 2019 TO BE WELL MINIMUM CAPITALIZED REQUIRED UNDER FOR PROMPT CAPITAL CORRECTIVE ADEQUACY ACTION COMPANY BANK PURPOSES REGULATIONS* AMOUNT RATIO AMOUNT RATIO RATIO RATIO (IN THOUSANDS, EXCEPT RATIOS) Total Capital (To Risk Weighted Assets) $ 132,544 13.49 % $ 119,477 12.23 % 8.00 % 10.00 % Tier 1 Common Equity (To Risk Weighted Assets) 102,841 10.47 109,173 11.17 4.50 6.50 Tier 1 Capital (To Risk Weighted Assets) 114,729 11.68 109,173 11.17 6.00 8.00 Tier 1 Capital (To Average Assets) 114,729 9.87 109,173 9.50 4.00 5.00 * Additionally, while not a regulatory capital ratio, the Company’s tangible common equity ratio was 7.34% (non-GAAP) at September 30, 2020. See the reconciliation of the tangible common equity ratio under the Balance Sheet section of the MD&A. |
Derivative Hedging Instruments
Derivative Hedging Instruments | 9 Months Ended |
Sep. 30, 2020 | |
Derivative Hedging Instruments | |
Derivative Hedging Instruments | 15. Derivative Hedging Instruments The Company can use various interest rate contracts, such as interest rate swaps, caps, floors and swaptions to help manage interest rate and market valuation risk exposure, which is incurred in normal recurrent banking activities. The Company can use derivative instruments, primarily interest rate swaps, to manage interest rate risk and match the rates on certain assets by hedging the fair value of certain fixed rate debt, which converts the debt to variable rates and by hedging the cash flow variability associated with certain variable rate debt by converting the debt to fixed rates. To accommodate the needs of our customers and support the Company’s asset/liability positioning, we may enter into interest rate swap agreements with customers and a large financial institution that specializes in these types of transactions. These arrangements involve the exchange of interest payments based on the notional amounts. The Company entered into floating rate loans and fixed rate swaps with our customers. Simultaneously, the Company entered into offsetting fixed rate swaps with Pittsburgh National Bank (PNC). In connection with each swap transaction, the Company agrees to pay interest to the customer on a notional amount at a variable interest rate and receive interest from the customer on the same notional amount at a fixed interest rate. At the same time, the Company agrees to pay PNC the same fixed interest rate on the same notional amount and receive the same variable interest rate on the same notional amount. These transactions allow the Company’s customers to effectively convert a variable rate loan to a fixed rate. Because the Company acts as an intermediary for its customers, changes in the fair value of the underlying derivative contracts offset each other and do not significantly impact the Company’s results of operations. These swaps are considered free-standing derivatives and are reported at fair value within other assets and other liabilities on the Consolidated Balance Sheets. Disclosures related to the fair value of the swap transactions can be found in Note 19. The following table summarizes the interest rate swap transactions that impacted the Company’s first nine months of 2020 and 2019 performance (in thousands, except percentages). At September 30, 2020 INCREASE AGGREGATE WEIGHTED (DECREASE) NOTIONAL AVERAGE RATE REPRICING IN INTEREST HEDGE TYPE AMOUNT RECEIVED/(PAID) FREQUENCY EXPENSE Swap assets Fair Value $ 36,726 3.06 % Monthly $ (345) Swap liabilities Fair Value (36,726) (3.06) Monthly 345 Net exposure — — — At September 30, 2019 INCREASE AGGREGATE WEIGHTED (DECREASE) NOTIONAL AVERAGE RATE REPRICING IN INTEREST HEDGE TYPE AMOUNT RECEIVED/(PAID) FREQUENCY EXPENSE Swap assets Fair Value $ 23,866 4.69 % Monthly $ 11 Swap liabilities Fair Value (23,866) (4.69) Monthly (11) Net exposure — — — The Company monitors and controls all derivative products with a comprehensive Board of Directors approved Hedging Policy. This policy permits a total maximum notional amount outstanding of $500 million for interest rate swaps, interest rate caps/floors, and swaptions. All hedge transactions must be approved in advance by the Investment Asset/Liability Committee (ALCO) of the Board of Directors, unless otherwise approved, as per the terms, within the Board of Directors approved Hedging Policy. The Company had no caps or floors outstanding at September 30, 2020 and 2019. None of the Company's derivatives are designated as hedging instruments. |
Segment Results
Segment Results | 9 Months Ended |
Sep. 30, 2020 | |
Segment Results | |
Segment Results | 16. Segment Results The financial performance of the Company is also monitored by an internal funds transfer pricing profitability measurement system which produces line of business results and key performance measures. The Company’s major business units include community banking, wealth management, and investment/parent. The reported results reflect the underlying economics of the business segments. Expenses for centrally provided services are allocated based upon the cost and estimated usage of those services. The businesses are match-funded and interest rate risk is centrally managed and accounted for within the investment/parent business segment. The key performance measure the Company focuses on for each business segment is net income contribution. The community banking segment includes both retail and commercial banking activities. Retail banking includes the deposit-gathering branch franchise and lending to both individuals and small businesses. Lending activities include residential mortgage loans, direct consumer loans, and small business commercial loans. Commercial banking to businesses includes commercial loans, business services, and CRE loans. The wealth management segment includes the Trust Company, West Chester Capital Advisors (WCCA), our registered investment advisory firm, and Financial Services. Wealth management activities include personal trust products and services such as personal portfolio investment management, estate planning and administration, custodial services and pre-need trusts. Also, institutional trust products and services such as 401(k) plans, defined benefit and defined contribution employee benefit plans, and individual retirement accounts are included in this segment. Financial Services include the sale of mutual funds, annuities, and insurance products. The wealth management businesses also include the union collective investment funds (ERECT funds) which are designed to use union pension dollars in construction projects that utilize union labor. The investment/parent includes the net results of investment securities and borrowing activities, general corporate expenses not allocated to the business segments, interest expense on corporate debt, and centralized interest rate risk management. Inter-segment revenues were not material. The contribution of the major business segments to the Consolidated Statements of Operations for the three and nine months ended September 30, 2020 and 2019 were as follows (in thousands): Three months ended Nine months ended September 30, 2020 September 30, 2020 Total revenue Net income (loss) Total revenue Net income (loss) Community banking $ 12,263 $ 2,509 $ 36,096 $ 7,788 Wealth management 2,620 547 7,672 1,510 Investment/Parent (1,788) (1,978) (4,850) (5,392) Total $ 13,095 $ 1,078 $ 38,918 $ 3,906 Three months ended Nine months ended September 30, 2019 September 30, 2019 Total revenue Net income (loss) Total revenue Net income (loss) Community banking $ 11,739 $ 2,791 $ 34,367 $ 8,621 Wealth management 2,458 477 7,315 1,365 Investment/Parent (1,338) (1,579) (3,843) (4,627) Total $ 12,859 $ 1,689 $ 37,839 $ 5,359 |
Commitments and Contingent Liab
Commitments and Contingent Liabilities | 9 Months Ended |
Sep. 30, 2020 | |
Commitments and Contingent Liabilities | |
Commitments and Contingent Liabilities | 17. Commitments and Contingent Liabilities The Company had various outstanding commitments to extend credit approximating $235.7 million and $195.5 million along with standby letters of credit of $13.5 million and $14.7 million as of September 30, 2020 and December 31, 2019, respectively. The Company’s exposure to credit loss in the event of nonperformance by the other party to these commitments to extend credit and standby letters of credit is represented by their contractual amounts. The Bank uses the same credit and collateral policies in making commitments and conditional obligations as for all other lending. Additionally, the Company is also subject to a number of asserted and unasserted potential claims encountered in the normal course of business. In the opinion of the Company, neither the resolution of these claims nor the funding of these credit commitments will have a material adverse effect on the Company’s consolidated financial position, results of operations or cash flows. |
Pension Benefits
Pension Benefits | 9 Months Ended |
Sep. 30, 2020 | |
Pension Benefits | |
Pension Benefits | 18. Pension Benefits The Company has a noncontributory defined benefit pension plan covering certain employees who work at least 1,000 hours per year. The participants have a vested interest in their accrued benefit after five full years of service. The benefits of the plan are based upon the employee’s years of service and average annual earnings for the highest five consecutive calendar years during the final ten-year period of employment. Plan assets are primarily debt securities (including US Treasury and Agency securities, corporate notes and bonds), listed common stocks (including shares of AmeriServ Financial, Inc. common stock which is limited to 10% of the plan’s assets), mutual funds, and short-term cash equivalent instruments. The net periodic pension cost for the three and nine months ended September 30, 2020 and 2019 were as follows (in thousands): Three months ended Nine months ended September 30, September 30, 2020 2019 2020 2019 COMPONENTS OF NET PERIODIC BENEFIT COST: Service cost $ 419 $ 368 $ 1,257 $ 1,104 Interest cost 320 392 960 1,176 Expected return on plan assets (811) (756) (2,433) (2,268) Recognized net actuarial loss 611 412 1,833 1,236 Net periodic pension cost $ 539 $ 416 $ 1,617 $ 1,248 The service cost component of net periodic benefit cost is included in “Salaries and employee benefits” and all other components of net periodic benefit cost are included in “Other expense” in the Consolidated Statements of Operations. The Company implemented a soft freeze of its defined benefit pension plan to provide that non-union employees hired on or after January 1, 2013 and union employees hired on or after January 1, 2014 are not eligible to participate in the pension plan. Instead, such employees are eligible to participate in a qualified 401(k) plan. This change was made to help reduce pension costs in future periods. |
Disclosures about Fair Value Me
Disclosures about Fair Value Measurements and Financial Instruments | 9 Months Ended |
Sep. 30, 2020 | |
Disclosures about Fair Value Measurements and Financial Instruments | |
Disclosures about Fair Value Measurements and Financial Instruments | 19. Disclosures about Fair Value Measurements and Financial Instruments The following disclosures establish a hierarchal disclosure framework associated with the level of pricing observability utilized in measuring assets and liabilities at fair value. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The three broad levels defined within this hierarchy are as follows: Level I: Quoted prices are available in active markets for identical assets or liabilities as of the reported date. Level II: Pricing inputs are other than the quoted prices in active markets, which are either directly or indirectly observable as of the reported date. The nature of these assets and liabilities includes items for which quoted prices are available but traded less frequently and items that are fair-valued using other financial instruments, the parameters of which can be directly observed. Level III: Assets and liabilities that have little to no pricing observability as of the reported date. These items do not have two-way markets and are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment or estimation. Assets and Liability Measured and Recorded on a Recurring Basis Equity securities are reported at fair value utilizing Level 1 inputs. These securities are mutual funds held within a rabbi trust for the Company's executive deferred compensation plan. The mutual funds held are open-end funds that are registered with the Securities and Exchange Commission. These funds are required to publish their daily net asset value and to transact at that price. Securities classified as available for sale are reported at fair value utilizing Level 2 inputs. For these securities, the Company obtains fair value measurements from an independent pricing service. The fair value measurements consider observable data that may include dealer quoted market spreads, cash flows, the US Treasury yield curve, live trading levels, trade execution data, market consensus prepayment speeds, credit information and the bond’s terms and conditions, among other things. The fair values of the interest rate swaps used for interest rate risk management are based on an external derivative valuation model using data inputs from similar transactions as of the valuation date and classified Level 2. The following table presents the assets and liability measured and reported on the Consolidated Balance Sheets on a recurring basis at their fair value as of September 30, 2020 and December 31, 2019, by level within the fair value hierarchy (in thousands). Fair Value Measurements at September 30, 2020 TOTAL (LEVEL 1) (LEVEL 2) (LEVEL 3) Equity securities $ 424 $ 424 $ — $ — Available for sale securities: U.S. Agency 3,276 — 3,276 — U.S. Agency mortgage-backed securities 69,042 — 69,042 — Municipal 18,651 — 18,651 — Corporate bonds 50,747 — 50,747 — Fair value swap asset 3,665 — 3,665 — Fair value swap liability (3,665) — (3,665) — Fair Value Measurements at December 31, 2019 TOTAL (LEVEL 1) (LEVEL 2) (LEVEL 3) Equity securities $ 366 $ 366 $ — $ — Available for sale securities: U.S. Agency 5,116 — 5,116 — U.S. Agency mortgage-backed securities 81,633 — 81,633 — Municipal 15,170 — 15,170 — Corporate bonds 39,830 — 39,830 — Fair value swap asset 959 — 959 — Fair value swap liability (959) — (959) — Assets Measured and Recorded on a Non-Recurring Basis Loans considered impaired are loans for which, based on current information and events, it is probable that the creditor will be unable to collect all amounts due according to the contractual terms of the loan agreement. Impaired loans are reported at the fair value of the underlying collateral if the repayment is expected solely from the collateral. Collateral values are estimated using Level 3 inputs based on observable market data which at times are discounted using unobservable inputs. At September 30, 2020, collateral-based impaired loans with a carrying value of $266,000 were reduced by a specific valuation allowance totaling $8,000 resulting in a net fair value of $258,000. At December 31, 2019, collateral-based impaired loans with a carrying value of $263,000 were reduced by a specific valuation allowance totaling $8,000 resulting in a net fair value of $255,000. Other real estate owned is measured at fair value based on appraisals, less estimated costs to sell at the date of foreclosure. Valuations are periodically performed by management and the assets are carried at the lower of carrying amount or fair value, less cost to sell. Income and expenses from operations and changes in valuation allowance are included in the net expenses from OREO. Assets measured and recorded at fair value on a non-recurring basis are summarized below (in thousands, except range data): FAIR VALUE MEASUREMENTS AT SEPTEMBER 30, 2020 USING TOTAL (LEVEL 1) (LEVEL 2) (LEVEL 3) Impaired loans $ 258 $ — $ — $ 258 Other real estate owned 40 — — 40 FAIR VALUE MEASUREMENTS AT DECEMBER 31, 2019 USING TOTAL (LEVEL 1) (LEVEL 2) (LEVEL 3) Impaired loans $ 255 $ — $ — $ 255 Other real estate owned 37 — — 37 September 30, 2020 Quantitative Information About Level 3 Fair Value Measurements Valuation Unobservable Fair Value Techniques Input Range (Wgtd Ave) Impaired loans $ 258 Appraisal of Appraisal 0% to 100% (3%) collateral (1) adjustments(2) Other real estate owned 40 Appraisal of Appraisal 57% (57%) collateral (1) adjustments(2) Liquidation 22% to 38% (30%) expenses December 31, 2019 Quantitative Information About Level 3 Fair Value Measurements Valuation Unobservable Fair Value Techniques Input Range (Wgtd Ave) Impaired loans $ 255 Appraisal of Appraisal 0% to 100% (3%) collateral (1) adjustments(2) Other real estate owned 37 Appraisal of Appraisal 0% to 57% (38%) collateral (1) adjustments(2) Liquidation 21% to 134% (30%) expenses (1) Fair Value is generally determined through independent appraisals of the underlying collateral, which generally include various level 3 inputs which are not identifiable. Also includes qualitative adjustments by management and estimated liquidation expenses. (2) Appraisals may be adjusted by management for qualitative factors such as economic conditions. FAIR VALUE OF FINANCIAL INSTRUMENTS For the Company, as for most financial institutions, approximately 90% of its assets and liabilities are considered financial instruments. Many of the Company’s financial instruments, however, lack an available trading market characterized by a willing buyer and willing seller engaging in an exchange transaction. Therefore, significant estimates and present value calculations were used by the Company for the purpose of this disclosure. Fair values have been determined by the Company using independent third party valuations that use the best available data (Level 2) and an estimation methodology (Level 3) the Company believes is suitable for each category of financial instruments. Management believes that cash and cash equivalents, bank owned life insurance, regulatory stock, accrued interest receivable and payable, and short-term borrowings have fair values which approximate the recorded carrying values. The fair value measurements for all of these financial instruments are Level 1 measurements. The estimated fair values based on US GAAP measurements and recorded carrying values at September 30, 2020 and December 31, 2019, for the remaining financial instruments not required to be measured or reported at fair value were as follows: September 30, 2020 Carrying Value Fair Value (Level 1) (Level 2) (Level 3) (IN THOUSANDS) FINANCIAL ASSETS: Investment securities – HTM $ 42,636 $ 45,308 $ — $ 42,311 $ 2,997 Loans held for sale 7,587 7,766 7,766 — — Loans, net of allowance for loan loss and unearned income 931,496 941,988 — — 941,988 FINANCIAL LIABILITIES: Deposits with no stated maturities 728,507 745,879 — — 745,879 Deposits with stated maturities 313,728 317,679 — — 317,679 All other borrowings (1) 94,830 100,945 — — 100,945 December 31, 2019 Carrying Value Fair Value (Level 1) (Level 2) (Level 3) (IN THOUSANDS) FINANCIAL ASSETS: Investment securities – HTM $ 39,936 $ 41,082 $ — $ 38,129 $ 2,953 Loans held for sale 4,868 4,970 4,970 — — Loans, net of allowance for loan loss and unearned income 873,427 873,908 — — 873,908 FINANCIAL LIABILITIES: Deposits with no stated maturities 651,469 631,023 — — 631,023 Deposits with stated maturities 309,044 310,734 — — 310,734 All other borrowings (1) 74,134 76,323 — — 76,323 (1) All other borrowings include advances from Federal Home Loan Bank, guaranteed junior subordinated deferrable interest debentures, and subordinated debt. Changes in assumptions or estimation methodologies may have a material effect on these estimated fair values. The Company’s remaining assets and liabilities which are not considered financial instruments have not been valued differently than has been customary under historical cost accounting. |
Risks and Uncertainties
Risks and Uncertainties | 9 Months Ended |
Sep. 30, 2020 | |
Risks and Uncertainties | |
Risks and Uncertainties | 20. Risks and Uncertainties The impact of the COVID-19 pandemic is fluid and continues to evolve, adversely affecting many of the Company’s customers. The pandemic and its associated impacts on trade (including supply chains and export levels), travel, employee productivity, unemployment, and consumer spending has resulted in less economic activity, and significant volatility and disruption in the financial markets. The ultimate extent of the impact of the COVID-19 pandemic on the Company’s business, financial condition, and results of operations is currently uncertain and will depend on various developments and other factors, including, among others, the duration and scope of the pandemic, as well as governmental, regulatory, and private sector responses to the pandemic, and the associated impacts on the economy, financial markets and our customers, employees, and vendors. While the full effects of the pandemic remain unknown, the Company is committed to supporting its customers, employees, and communities during this difficult time. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Revenue Recognition | |
Schedule of non-interest income, segregated by revenue | The following presents non-interest income, segregated by revenue streams in-scope and out-of-scope of Topic 606, for the three and nine month periods ending September 30, 2020 and 2019 (in thousands). Three months ended Nine months ended September 30, September 30, 2020 2019 2020 2019 Non-interest income: In-scope of Topic 606 Wealth management fees $ 2,604 $ 2,431 $ 7,629 $ 7,246 Service charges on deposit accounts 206 321 668 948 Other 485 471 1,271 1,325 Non-interest income (in-scope of topic 606) 3,295 3,223 9,568 9,519 Non-interest income (out-of-scope of topic 606) 1,009 872 2,335 1,838 Total non-interest income $ 4,304 $ 4,095 $ 11,903 $ 11,357 |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Common Share | |
Schedule of Earnings Per Common Share | Three months ended Nine months ended September 30, September 30, 2020 2019 2020 2019 (In thousands, except per share data) Numerator: Net income $ 1,078 $ 1,689 $ 3,906 $ 5,359 Denominator: Weighted average common shares outstanding (basic) 17,059 17,278 17,051 17,443 Effect of stock options 3 82 12 81 Weighted average common shares outstanding (diluted) 17,062 17,360 17,063 17,524 Earnings per common share : Basic $ 0.06 $ 0.10 $ 0.23 $ 0.31 Diluted 0.06 0.10 0.23 0.31 |
Investment Securities (Tables)
Investment Securities (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Investment Securities | |
Schedule of cost basis and fair values of investment securities | SEPTEMBER 30, 2020 GROSS GROSS UNREALIZED UNREALIZED FAIR COST BASIS GAINS LOSSES VALUE (IN THOUSANDS) U.S. Agency $ 3,079 $ 197 $ — $ 3,276 U.S. Agency mortgage-backed securities 66,198 2,850 (6) 69,042 Municipal 17,409 1,242 — 18,651 Corporate bonds 50,586 557 (396) 50,747 Total $ 137,272 $ 4,846 $ (402) $ 141,716 Investment securities held to maturity (HTM): SEPTEMBER 30, 2020 GROSS GROSS UNREALIZED UNREALIZED FAIR COST BASIS GAINS LOSSES VALUE (IN THOUSANDS) U.S. Agency mortgage-backed securities $ 7,719 $ 394 $ — $ 8,113 Municipal 28,889 2,225 (51) 31,063 Corporate bonds and other securities 6,028 108 (4) 6,132 Total $ 42,636 $ 2,727 $ (55) $ 45,308 Investment securities available for sale (AFS): DECEMBER 31, 2019 GROSS GROSS UNREALIZED UNREALIZED FAIR COST BASIS GAINS LOSSES VALUE (IN THOUSANDS) U.S. Agency $ 5,084 $ 32 $ — $ 5,116 U.S. Agency mortgage-backed securities 80,046 1,681 (94) 81,633 Municipal 14,678 509 (17) 15,170 Corporate bonds 39,769 342 (281) 39,830 Total $ 139,577 $ 2,564 $ (392) $ 141,749 Investment securities held to maturity (HTM): DECEMBER 31, 2019 GROSS GROSS UNREALIZED UNREALIZED FAIR COST BASIS GAINS LOSSES VALUE (IN THOUSANDS) U.S. Agency mortgage-backed securities $ 9,466 $ 251 $ (4) $ 9,713 Municipal 24,438 941 (53) 25,326 Corporate bonds and other securities 6,032 58 (47) 6,043 Total $ 39,936 $ 1,250 $ (104) $ 41,082 |
Schedule of investments with unrealized losses | The following tables present information concerning investments with unrealized losses as of September 30, 2020 and December 31, 2019 (in thousands): Total investment securities: SEPTEMBER 30, 2020 LESS THAN 12 MONTHS 12 MONTHS OR LONGER TOTAL FAIR UNREALIZED FAIR UNREALIZED FAIR UNREALIZED VALUE LOSSES VALUE LOSSES VALUE LOSSES U.S. Agency $ — $ — $ — $ — $ — $ — U.S. Agency mortgage-backed securities 1,438 (5) 138 (1) 1,576 (6) Municipal 1,044 (1) 752 (50) 1,796 (51) Corporate bonds and other securities 15,741 (259) 6,859 (141) 22,600 (400) Total $ 18,223 $ (265) $ 7,749 $ (192) $ 25,972 $ (457) Total investment securities: DECEMBER 31, 2019 LESS THAN 12 MONTHS 12 MONTHS OR LONGER TOTAL FAIR UNREALIZED FAIR UNREALIZED FAIR UNREALIZED VALUE LOSSES VALUE LOSSES VALUE LOSSES U.S. Agency $ — $ — $ — $ — $ — $ — U.S. Agency mortgage-backed securities 7,084 (23) 8,562 (75) 15,646 (98) Municipal 2,269 (18) 1,123 (52) 3,392 (70) Corporate bonds and other securities 7,797 (85) 11,783 (243) 19,580 (328) Total $ $ (126) $ $ (370) $ 38,618 $ (496) |
Schedule of investment securities | September 30, 2020 Available for sale Held to maturity Cost Basis Fair Value Cost Basis Fair Value Within 1 year $ 5,060 $ 5,093 $ 3,400 $ 3,403 After 1 year but within 5 years 22,222 22,536 7,629 8,054 After 5 years but within 10 years 48,851 50,395 17,115 18,607 After 10 years but within15 years 19,253 20,120 9,395 9,946 Over 15 years 41,886 43,572 5,097 5,298 Total $ 137,272 $ 141,716 $ 42,636 $ 45,308 |
Loans (Tables)
Loans (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Loans | |
Schedule of loan portfolio | The loan portfolio of the Company consists of the following (in thousands): September 30, 2020 December 31, 2019 Commercial: Commercial and industrial $ 152,636 $ 173,922 Paycheck Protection Program (PPP) 68,460 — Commercial loans secured by owner occupied real estate 90,819 91,655 Commercial loans secured by non-owner occupied real estate 378,858 363,635 Real estate − residential mortgage 233,811 235,239 Consumer 17,196 18,255 Loans, net of unearned income $ 941,780 $ |
Summary of risk concentrations for commercial and commercial real estate loans by industry type | The following table provides information regarding our potential COVID-19 risk concentrations for commercial and commercial real estate loans by industry type at September 30, 2020 (in thousands). Paycheck Commercial loans Commercial loans Commercial Protection secured by owner secured by non-owner and industrial Program occupied real estate occupied real estate Total 1-4 unit residential $ 1,488 $ — $ 107 $ 5,920 $ 7,515 Multifamily/apartments/student housing — — 418 54,963 55,381 Office 32,793 9,924 10,075 34,452 87,244 Retail 7,997 1,786 21,213 116,830 147,826 Industrial/manufacturing/warehouse 89,382 29,463 17,751 43,093 179,689 Hotels 372 1,287 — 41,830 43,489 Eating and drinking places 855 13,630 4,424 538 19,447 Amusement and recreation 245 106 3,345 46 3,742 Mixed use — — 2,802 66,435 69,237 Other 19,504 12,264 30,684 14,751 77,203 Total $ 152,636 $ 68,460 $ 90,819 $ 378,858 $ 690,773 |
Allowance for Loan Losses (Tabl
Allowance for Loan Losses (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Allowance for Loan Losses | |
Schedule of Loan losses by portfolio segment | The following tables summarize the rollforward of the allowance for loan losses by portfolio segment for the three and nine month periods ending September 30, 2020 and 2019 (in thousands). Three months ended September 30, 2020 Balance at Charge- Provision Balance at June 30, 2020 Offs Recoveries (Credit) September 30, 2020 Commercial $ 3,784 $ (111) $ 1 $ (638) $ 3,036 Commercial loans secured by non-owner occupied real estate 3,619 — 10 1,261 4,890 Real estate-residential mortgage 1,216 (19) 24 4 1,225 Consumer 119 (14) 19 (4) 120 Allocation for general risk 961 — — 52 1,013 Total $ 9,699 $ (144) $ 54 $ 675 $ 10,284 Three months ended September 30, 2019 Balance at Charge- Provision Balance at June 30, 2019 Offs Recoveries (Credit) September 30, 2019 Commercial $ 2,538 $ (1) $ 8 $ 464 $ 3,009 Commercial loans secured by non-owner occupied real estate 3,425 — 12 (81) 3,356 Real estate-residential mortgage 1,218 — 25 (46) 1,197 Consumer 124 (36) 10 28 126 Allocation for general risk 797 — — (140) 657 Total $ 8,102 $ (37) $ 55 $ 225 $ 8,345 Nine months ended September 30, 2020 Balance at Charge- Provision Balance at December 31, 2019 Offs Recoveries (Credit) September 30, 2020 Commercial $ 3,951 $ (111) $ 1 $ (805) $ 3,036 Commercial loans secured by non-owner occupied real estate 3,119 — 31 1,740 4,890 Real estate-residential mortgage 1,159 (201) 46 221 1,225 Consumer 126 (105) 44 55 120 Allocation for general risk 924 — — 89 1,013 Total $ 9,279 $ (417) $ 122 $ 1,300 $ 10,284 Nine months ended September 30, 2019 Balance at Charge- Provision Balance at December 31, 2018 Offs Recoveries (Credit) September 30, 2019 Commercial $ 3,057 $ (1) $ 13 $ (60) $ 3,009 Commercial loans secured by non-owner occupied real estate 3,389 (63) 36 (6) 3,356 Real estate-residential mortgage 1,235 (71) 101 (68) 1,197 Consumer 127 (206) 40 165 126 Allocation for general risk 863 — — (206) 657 Total $ 8,671 $ (341) $ 190 $ (175) $ 8,345 |
Schedule of Loan loss by the primary segments | The following tables summarize the loan portfolio and allowance for loan loss by the primary segments of the loan portfolio (in thousands). At September 30, 2020 Commercial Loans Secured by Non-Owner Real Estate- Occupied Residential Allocation for Commercial Real Estate Mortgage Consumer General Risk Total Loans: Individually evaluated for impairment $ 859 $ 8 $ — $ — $ 867 Collectively evaluated for impairment 311,056 378,850 233,811 17,196 940,913 Total loans $ 311,915 $ 378,858 $ 233,811 $ 17,196 $ 941,780 Allowance for loan losses: Specific reserve allocation $ 98 $ 8 $ — $ — $ — $ 106 General reserve allocation 2,938 4,882 1,225 120 1,013 10,178 Total allowance for loan losses $ 3,036 $ 4,890 $ 1,225 $ 120 $ 1,013 $ 10,284 At December 31, 2019 Commercial Loans Secured by Non-Owner Real Estate- Occupied Residential Allocation for Commercial Real Estate Mortgage Consumer General Risk Total Loans: Individually evaluated for impairment $ 816 $ 8 $ — $ — $ 824 Collectively evaluated for impairment 264,761 363,627 235,239 18,255 881,882 Total loans $ 265,577 $ 363,635 $ 235,239 $ 18,255 $ 882,706 Allowance for loan losses: Specific reserve allocation $ 84 $ 8 $ — $ — $ — $ 92 General reserve allocation 3,867 3,111 1,159 126 924 9,187 Total allowance for loan losses $ 3,951 $ 3,119 $ 1,159 $ 126 $ 924 $ 9,279 |
Schedule of Present impaired loans by portfolio segment | The following tables present impaired loans by portfolio segment, segregated by those for which a specific allowance was required and those for which a specific allowance was not necessary. At September 30, 2020 IMPAIRED LOANS WITH IMPAIRED LOANS WITH NO SPECIFIC SPECIFIC ALLOWANCE ALLOWANCE TOTAL IMPAIRED LOANS UNPAID RECORDED RELATED RECORDED RECORDED PRINCIPAL INVESTMENT ALLOWANCE INVESTMENT INVESTMENT BALANCE (IN THOUSANDS) Commercial $ 859 $ 98 $ — $ 859 $ 859 Commercial loans secured by non-owner occupied real estate 8 8 — 8 30 Total impaired loans $ 867 $ 106 $ — $ 867 $ 889 At December 31, 2019 IMPAIRED LOANS WITH IMPAIRED LOANS WITH NO SPECIFIC SPECIFIC ALLOWANCE ALLOWANCE TOTAL IMPAIRED LOANS UNPAID RECORDED RELATED RECORDED RECORDED PRINCIPAL INVESTMENT ALLOWANCE INVESTMENT INVESTMENT BALANCE (IN THOUSANDS) Commercial 816 $ 84 $ — $ 816 $ 816 Commercial loans secured by non-owner occupied real estate $ 8 $ 8 $ — $ 8 $ 30 Total impaired loans $ 824 $ 92 $ — $ 824 $ 846 |
Schedule of Investment in impaired loans and related interest income | The following table presents the average recorded investment in impaired loans and related interest income recognized for the periods indicated (in thousands). Three months ended Nine months ended September 30, September 30, 2020 2019 2020 2019 Average impaired balance: Commercial $ 839 $ 785 $ 832 $ 393 Commercial loans secured by non-owner occupied real estate 8 10 8 10 Average investment in impaired loans $ 847 $ 795 $ 840 $ 403 Interest income recognized: Commercial $ 9 $ 13 $ 31 $ 17 Commercial loans secured by non-owner occupied real estate — — — — Interest income recognized on a cash basis on impaired loans $ 9 $ 13 $ 31 $ 17 |
Schedule of Commercial and commercial real estate loan portfolios | The following table presents the classes of the commercial and commercial real estate loan portfolios summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system. At September 30, 2020 SPECIAL PASS MENTION SUBSTANDARD DOUBTFUL TOTAL (IN THOUSANDS) Commercial and industrial $ 142,948 $ 6,336 $ 3,352 $ — $ 152,636 Paycheck Protection Program (PPP) 68,460 — — — 68,460 Commercial loans secured by owner occupied real estate 87,844 1,889 1,086 — 90,819 Commercial loans secured by non-owner occupied real estate 349,901 27,472 1,477 8 378,858 Total $ 649,153 $ 35,697 $ 5,915 $ 8 $ 690,773 At December 31, 2019 SPECIAL PASS MENTION SUBSTANDARD DOUBTFUL TOTAL (IN THOUSANDS) Commercial and industrial $ 161,147 $ 853 $ 11,922 $ — $ 173,922 Commercial loans secured by owner occupied real estate 88,942 1,384 1,329 — 91,655 Commercial loans secured by non-owner occupied real estate 362,027 — 1,600 8 363,635 Total $ 612,116 $ 2,237 $ 14,851 $ 8 $ 629,212 |
Schedule of Residential and consumer portfolio | The following tables present the performing and non-performing outstanding balances of the residential and consumer portfolio classes. At September 30, 2020 NON- PERFORMING PERFORMING TOTAL (IN THOUSANDS) Real estate – residential mortgage $ 232,115 $ 1,696 $ 233,811 Consumer 17,196 — 17,196 Total $ 249,311 $ 1,696 $ 251,007 At December 31, 2019 NON- PERFORMING PERFORMING TOTAL (IN THOUSANDS) Real estate – residential mortgage $ 233,760 $ 1,479 $ 235,239 Consumer 18,255 — 18,255 Total $ 252,015 $ 1,479 $ 253,494 |
Schedule of Credit quality of the loan portfolio | The following tables present the classes of the loan portfolio summarized by the aging categories of performing loans and non-accrual loans. At September 30, 2020 90 DAYS 30 – 59 60 – 89 PAST DUE DAYS DAYS 90 DAYS TOTAL TOTAL AND STILL CURRENT PAST DUE PAST DUE PAST DUE PAST DUE LOANS ACCRUING (IN THOUSANDS) Commercial and industrial $ 152,558 $ 78 $ — $ — $ 78 $ 152,636 $ — Paycheck Protection Program (PPP) 68,460 — — — — 68,460 $ — Commercial loans secured by owner occupied real estate 90,819 — — — — 90,819 — Commercial loans secured by non-owner occupied real estate 378,858 — — — — 378,858 — Real estate – residential mortgage 229,851 1,922 1,039 999 3,960 233,811 — Consumer 17,156 40 — — 40 17,196 — Total $ 937,702 $ 2,040 $ 1,039 $ 999 $ 4,078 $ 941,780 $ — At December 31, 2019 90 DAYS 30 – 59 60 – 89 PAST DUE DAYS DAYS 90 DAYS TOTAL TOTAL AND STILL CURRENT PAST DUE PAST DUE PAST DUE PAST DUE LOANS ACCRUING (IN THOUSANDS) Commercial and industrial $ 173,922 $ — $ — $ — $ — $ 173,922 $ — Commercial loans secured by owner occupied real estate 91,538 117 — — 117 91,655 — Commercial loans secured by non-owner occupied real estate 363,635 — — — — 363,635 — Real estate – residential mortgage 231,022 2,331 864 1,022 4,217 235,239 — Consumer 18,190 42 23 — 65 18,255 — Total $ 878,307 $ 2,490 $ 887 $ 1,022 $ 4,399 $ 882,706 $ — |
Non-Performing Assets Includi_2
Non-Performing Assets Including Troubled Debt Restructurings (TDR) (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Non-Performing Assets Including Troubled Debt Restructurings (TDR) | |
Schedule of nonperforming assets including trouble debt restructurings | The following table presents information concerning non-performing assets including TDR (in thousands, except percentages): September 30, 2020 December 31, 2019 Non-accrual loans: Commercial and industrial $ 20 $ — Commercial loans secured by non-owner occupied real estate 8 8 Real estate – residential mortgage 1,696 1,479 Total 1,724 1,487 Other real estate owned: Real estate – residential mortgage 40 37 Total 40 37 TDR’s not in non-accrual: Commercial and industrial 839 815 Total 839 815 Total non-performing assets including TDR $ 2,603 $ 2,339 Total non-performing assets as a percent of loans, net of unearned income, and other real estate owned 0.27 % 0.26 % |
Schedule of interest income on non accrual loans | The following table sets forth, for the periods indicated, (1) the gross interest income that would have been recorded if non-accrual loans had been current in accordance with their original terms and had been outstanding throughout the period or since origination if held for part of the period, (2) the amount of interest income actually recorded on such loans, and (3) the net reduction in interest income attributable to such loans (in thousands). Three months ended Nine months ended September 30, September 30, 2020 2019 2020 2019 Interest income due in accordance with original terms $ 22 $ 14 $ 60 $ 43 Interest income recorded — — — — Net reduction in interest income $ 22 $ 14 $ 60 $ 43 |
Schedule of troubled debt restructurings on financing receivables | Loans in accrual status # of Loans Current Balance Concession Granted Commercial and industrial 1 $ 47 Extension of maturity date with a below market interest rate The following table details the loans modified as TDR’s during the nine month period ended September 30, 2020 (dollars in thousands). Loans in accrual status # of Loans Current Balance Concession Granted Commercial and industrial 1 $ 750 Subsequent modification of a TDR - Extension of maturity date with a below market interest rate Commercial and industrial 1 47 Extension of maturity date with a below market interest rate The following table details the loan modified as a TDR during the three month period ended September 30, 2019 (dollars in thousands). Loans in accrual status # of Loans Current Balance Concession Granted Commercial and industrial 1 $ 70 Extension of maturity date with a below market interest rate The following table details the loans modified as TDR’s during the nine month period ended September 30, 2019 (dollars in thousands). Loans in accrual status # of Loans Current Balance Concession Granted Commercial and industrial 2 $ 820 Extension of maturity date with a below market interest rate |
Summary of loans for which payment relief has been requested related to COVID-19 | At September 30, 2020 At June 30, 2020 % of Outstanding % of Outstanding Balance Non-PPP Loans Balance Non-PPP Loans (in thousands) (in thousands) CRE/Commercial $ 140,132 21.8 % $ 190,276 30.4 % Home Equity/Consumer 160 0.2 5,890 6.0 Residential Mortgage 4,069 2.9 3,839 2.8 Total $ 144,361 16.4 $ 200,005 23.2 |
Summary of deferral of principal and interest payments | At September 30, 2020 At June 30, 2020 Number of Loans Balance Number of Loans Balance (in thousands) (in thousands) Type of Payment Relief Interest only payments 67 $ 74,680 83 $ 87,881 Complete payment deferrals 127 69,681 296 103,378 Maturity date extensions — — 4 8,746 Total 194 $ 144,361 383 $ 200,005 |
Short-Term and Federal Home L_2
Short-Term and Federal Home Loan Bank Borrowings (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Short-Term and Federal Home Loan Bank Borrowing | |
Schedule of federal home loan bank borrowings | Total short-term and Federal Home Loan Bank (FHLB) borrowings and advances consist of the following (in thousands, except percentages): At September 30, 2020 Weighted Type Maturing Amount Average Rate Federal Funds Purchased Overnight $ 2,000 0.65 % Open Repo Plus Overnight 3,894 0.39 FHLB Advances 2020 11,187 0.95 2021 22,496 1.08 2022 20,888 2.03 2023 15,568 1.59 2024 4,197 1.19 Total FHLB advances 74,336 1.44 Total short-term and FHLB borrowings $ 80,230 1.37 % At December 31, 2019 Weighted Type Maturing Amount Average Rate Open Repo Plus Overnight $ 22,412 1.81 % FHLB Advances 2020 18,729 1.75 2021 9,496 2.28 2022 17,838 2.21 2023 5,568 2.48 2024 2,037 1.86 Total FHLB advances 53,668 2.08 Total short-term and FHLB borrowings $ 76,080 2.00 % |
Lease Commitments (Tables)
Lease Commitments (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Lease Commitments | |
Schedule of lease cost associated with both operating and financing leases | The following table presents the lease cost associated with both operating and financing leases for the three and nine month periods ending September 30, 2020 and 2019 (in thousands). Three months ended Nine months ended September 30, September 30, 2020 2019 2020 2019 Lease cost Financing lease cost: Amortization of right-of-use asset $ 68 $ 64 $ 203 $ 193 Interest expense 28 29 85 88 Operating lease cost 29 29 87 87 Total lease cost $ 125 $ 122 $ 375 $ 368 |
Schedule of weighted average discount rates and the remaining term of the leases | The following table presents the weighted-average remaining lease term and discount rate for the leases outstanding at September 30, 2020 and December 31, 2019. September 30, 2020 December 31, 2019 Operating Financing Operating Financing Weighted-average remaining term (years) 11.5 16.1 11.9 17.1 Weighted-average discount rate 3.48 % 3.51 % 3.46 % 3.60 % |
Schedule of reconciliation to the discounted amount recorded on the consolidated balance sheets | The following table presents the undiscounted cash flows due related to operating and financing leases, along with a reconciliation to the discounted amount recorded on the Consolidated Balance Sheets (in thousands). September 30, 2020 OPERATING FINANCING Undiscounted cash flows due: Within 1 year $ 119 $ 316 After 1 year but within 2 years 110 319 After 2 years but within 3 years 69 320 After 3 years but within 4 years 69 253 After 4 years but within 5 years 69 252 After 5 years 539 2,821 Total undiscounted cash flows 975 4,281 Discount on cash flows (177) (1,120) Total lease liabilities $ 798 $ 3,161 December 31, 2019 OPERATING FINANCING Undiscounted cash flows due: Within 1 year $ 118 $ 296 After 1 year but within 2 years 120 275 After 2 years but within 3 years 98 277 After 3 years but within 4 years 69 274 After 4 years but within 5 years 69 236 After 5 years 589 3,007 Total undiscounted cash flows 1,063 4,365 Discount on cash flows (198) (1,202) Total lease liabilities $ 865 $ 3,163 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Accumulated Other Comprehensive Loss | |
Schedule of accumulated other comprehensive loss, net of tax | The following table presents the changes in each component of accumulated other comprehensive loss, net of tax, for the three and nine months ended September 30, 2020 and 2019 (in thousands): Three months ended September 30, 2020 Three months ended September 30, 2019 Net Net Unrealized Unrealized Gains and Gains and Losses on Defined Losses on Defined Investment Benefit Investment Benefit Securities Pension Securities Pension AFS (1) Items (1) Total (1) AFS (1) Items (1) Total (1) Beginning balance $ 3,398 $ (17,469) $ (14,071) $ 1,398 $ (13,948) $ (12,550) Other comprehensive income (loss) before reclassifications 113 (483) (370) 480 (7) 473 Amounts reclassified from accumulated other comprehensive loss — 483 483 (69) 325 256 Net current period other comprehensive income 113 — 113 411 318 729 Ending balance $ 3,511 $ (17,469) $ (13,958) $ 1,809 $ (13,630) $ (11,821) (1) Amounts in parentheses indicate debits on the Consolidated Balance Sheets. Nine months ended September 30, 2020 Nine months ended September 30, 2019 Net Net Unrealized Unrealized Gains and Gains and Losses on Defined Losses on Defined Investment Benefit Investment Benefit Securities Pension Securities Pension AFS (1) Items (1) Total (1) AFS (1) Items (1) Total (1) Beginning balance $ 1,715 $ (17,886) $ (16,171) $ (1,409) $ (12,816) $ (14,225) Other comprehensive income (loss) before reclassifications 1,796 (1,031) 765 3,311 (1,790) 1,521 Amounts reclassified from accumulated other comprehensive loss — 1,448 1,448 (93) 976 883 Net current period other comprehensive income (loss) 1,796 417 2,213 3,218 (814) 2,404 Ending balance $ 3,511 $ (17,469) $ (13,958) $ 1,809 $ (13,630) $ (11,821) (1) Amounts in parentheses indicate debits on the Consolidated Balance Sheets. |
Schedule of reclassification out of accumulated other comprehensive loss | The following table presents the amounts reclassified out of each component of accumulated other comprehensive loss for the three and nine months ended Septembere 30, 2020 and 2019 (in thousands): Amount reclassified from accumulated other comprehensive loss (1) For the three For the three months ended months ended Affected line item in the Details about accumulated other comprehensive loss components September 30, 2020 September 30, 2019 statement of operations Realized (gains) losses on sale of securities $ — $ (88) Net realized gains on investment securities — 19 Provision for income taxes $ — $ (69) Amortization of estimated defined benefit pension plan loss (2) $ 611 $ 412 Other expense (128) (87) Provision for income taxes $ 483 $ 325 Total reclassifications for the period $ 483 $ 256 (1) Amounts in parentheses indicate credits. (2) These accumulated other comprehensive loss components are included in the computation of net periodic benefit cost (see Note 18 for additional details). Amount reclassified from accumulated other comprehensive loss (1) For the nine For the nine months ended months ended Affected line item in the Details about accumulated other comprehensive loss components September 30, 2020 September 30, 2019 statement of operations Realized (gains) losses on sale of securities $ — $ (118) Net realized gains on investment securities — 25 Provision for income taxes $ — $ (93) Amortization of estimated defined benefit pension plan loss (2) $ 1,833 $ 1,236 Other expense (385) (260) Provision for income taxes $ 1,448 $ 976 Total reclassifications for the period $ 1,448 $ 883 (1) Amounts in parentheses indicate credits. (2) These accumulated other comprehensive loss components are included in the computation of net periodic benefit cost (see Note 18 for additional details). |
Regulatory Capital (Tables)
Regulatory Capital (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Regulatory Capital | |
Schedule of compliance with regulatory capital requirements under banking regulations | The Company believes that no conditions or events have occurred that would change this conclusion as of such date. To be categorized as well capitalized, the Bank must maintain minimum total capital, common equity tier 1 capital, tier 1 capital, and tier 1 leverage ratios as set forth in the table (in thousands, except ratios). At September 30, 2020 TO BE WELL MINIMUM CAPITALIZED REQUIRED UNDER FOR PROMPT CAPITAL CORRECTIVE ADEQUACY ACTION COMPANY BANK PURPOSES REGULATIONS* AMOUNT RATIO AMOUNT RATIO RATIO RATIO (IN THOUSANDS, EXCEPT RATIOS) Total Capital (To Risk Weighted Assets) $ 135,967 13.02 % $ 122,960 11.80 % 8.00 % 10.00 % Tier 1 Common Equity (To Risk Weighted Assets) 105,383 10.09 111,803 10.73 4.50 6.50 Tier 1 Capital (To Risk Weighted Assets) 117,282 11.23 111,803 10.73 6.00 8.00 Tier 1 Capital (To Average Assets) 117,282 9.39 111,803 9.05 4.00 5.00 At December 31, 2019 TO BE WELL MINIMUM CAPITALIZED REQUIRED UNDER FOR PROMPT CAPITAL CORRECTIVE ADEQUACY ACTION COMPANY BANK PURPOSES REGULATIONS* AMOUNT RATIO AMOUNT RATIO RATIO RATIO (IN THOUSANDS, EXCEPT RATIOS) Total Capital (To Risk Weighted Assets) $ 132,544 13.49 % $ 119,477 12.23 % 8.00 % 10.00 % Tier 1 Common Equity (To Risk Weighted Assets) 102,841 10.47 109,173 11.17 4.50 6.50 Tier 1 Capital (To Risk Weighted Assets) 114,729 11.68 109,173 11.17 6.00 8.00 Tier 1 Capital (To Average Assets) 114,729 9.87 109,173 9.50 4.00 5.00 * |
Derivative Hedging Instruments
Derivative Hedging Instruments (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Derivative Hedging Instruments | |
Schedule of interest rate swap transactions | The following table summarizes the interest rate swap transactions that impacted the Company’s first nine months of 2020 and 2019 performance (in thousands, except percentages). At September 30, 2020 INCREASE AGGREGATE WEIGHTED (DECREASE) NOTIONAL AVERAGE RATE REPRICING IN INTEREST HEDGE TYPE AMOUNT RECEIVED/(PAID) FREQUENCY EXPENSE Swap assets Fair Value $ 36,726 3.06 % Monthly $ (345) Swap liabilities Fair Value (36,726) (3.06) Monthly 345 Net exposure — — — At September 30, 2019 INCREASE AGGREGATE WEIGHTED (DECREASE) NOTIONAL AVERAGE RATE REPRICING IN INTEREST HEDGE TYPE AMOUNT RECEIVED/(PAID) FREQUENCY EXPENSE Swap assets Fair Value $ 23,866 4.69 % Monthly $ 11 Swap liabilities Fair Value (23,866) (4.69) Monthly (11) Net exposure — — — |
Segment Results (Tables)
Segment Results (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Segment Results | |
Schedule of business segments | The contribution of the major business segments to the Consolidated Statements of Operations for the three and nine months ended September 30, 2020 and 2019 were as follows (in thousands): Three months ended Nine months ended September 30, 2020 September 30, 2020 Total revenue Net income (loss) Total revenue Net income (loss) Community banking $ 12,263 $ 2,509 $ 36,096 $ 7,788 Wealth management 2,620 547 7,672 1,510 Investment/Parent (1,788) (1,978) (4,850) (5,392) Total $ 13,095 $ 1,078 $ 38,918 $ 3,906 Three months ended Nine months ended September 30, 2019 September 30, 2019 Total revenue Net income (loss) Total revenue Net income (loss) Community banking $ 11,739 $ 2,791 $ 34,367 $ 8,621 Wealth management 2,458 477 7,315 1,365 Investment/Parent (1,338) (1,579) (3,843) (4,627) Total $ 12,859 $ 1,689 $ 37,839 $ 5,359 |
Pension Benefits (Tables)
Pension Benefits (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Pension Benefits | |
Schedule of net periodic pension cost | The net periodic pension cost for the three and nine months ended September 30, 2020 and 2019 were as follows (in thousands): Three months ended Nine months ended September 30, September 30, 2020 2019 2020 2019 COMPONENTS OF NET PERIODIC BENEFIT COST: Service cost $ 419 $ 368 $ 1,257 $ 1,104 Interest cost 320 392 960 1,176 Expected return on plan assets (811) (756) (2,433) (2,268) Recognized net actuarial loss 611 412 1,833 1,236 Net periodic pension cost $ 539 $ 416 $ 1,617 $ 1,248 |
Disclosures about Fair Value _2
Disclosures about Fair Value Measurements and Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Disclosures about Fair Value Measurements and Financial Instruments | |
Schedule of assets and liabilities measured and recorded at fair value on a recurring basis | The fair values of the interest rate swaps used for interest rate risk management are based on an external derivative valuation model using data inputs from similar transactions as of the valuation date and classified Level 2. The following table presents the assets and liability measured and reported on the Consolidated Balance Sheets on a recurring basis at their fair value as of September 30, 2020 and December 31, 2019, by level within the fair value hierarchy (in thousands). Fair Value Measurements at September 30, 2020 TOTAL (LEVEL 1) (LEVEL 2) (LEVEL 3) Equity securities $ 424 $ 424 $ — $ — Available for sale securities: U.S. Agency 3,276 — 3,276 — U.S. Agency mortgage-backed securities 69,042 — 69,042 — Municipal 18,651 — 18,651 — Corporate bonds 50,747 — 50,747 — Fair value swap asset 3,665 — 3,665 — Fair value swap liability (3,665) — (3,665) — Fair Value Measurements at December 31, 2019 TOTAL (LEVEL 1) (LEVEL 2) (LEVEL 3) Equity securities $ 366 $ 366 $ — $ — Available for sale securities: U.S. Agency 5,116 — 5,116 — U.S. Agency mortgage-backed securities 81,633 — 81,633 — Municipal 15,170 — 15,170 — Corporate bonds 39,830 — 39,830 — Fair value swap asset 959 — 959 — Fair value swap liability (959) — (959) — |
Schedule of assets measured and recorded at fair value on a non-recurring basis | Assets measured and recorded at fair value on a non-recurring basis are summarized below (in thousands, except range data): FAIR VALUE MEASUREMENTS AT SEPTEMBER 30, 2020 USING TOTAL (LEVEL 1) (LEVEL 2) (LEVEL 3) Impaired loans $ 258 $ — $ — $ 258 Other real estate owned 40 — — 40 FAIR VALUE MEASUREMENTS AT DECEMBER 31, 2019 USING TOTAL (LEVEL 1) (LEVEL 2) (LEVEL 3) Impaired loans $ 255 $ — $ — $ 255 Other real estate owned 37 — — 37 September 30, 2020 Quantitative Information About Level 3 Fair Value Measurements Valuation Unobservable Fair Value Techniques Input Range (Wgtd Ave) Impaired loans $ 258 Appraisal of Appraisal 0% to 100% (3%) collateral (1) adjustments(2) Other real estate owned 40 Appraisal of Appraisal 57% (57%) collateral (1) adjustments(2) Liquidation 22% to 38% (30%) expenses December 31, 2019 Quantitative Information About Level 3 Fair Value Measurements Valuation Unobservable Fair Value Techniques Input Range (Wgtd Ave) Impaired loans $ 255 Appraisal of Appraisal 0% to 100% (3%) collateral (1) adjustments(2) Other real estate owned 37 Appraisal of Appraisal 0% to 57% (38%) collateral (1) adjustments(2) Liquidation 21% to 134% (30%) expenses (1) Fair Value is generally determined through independent appraisals of the underlying collateral, which generally include various level 3 inputs which are not identifiable. Also includes qualitative adjustments by management and estimated liquidation expenses. (2) Appraisals may be adjusted by management for qualitative factors such as economic conditions. |
Schedule of estimated fair value and recorded carrying value | The estimated fair values based on US GAAP measurements and recorded carrying values at September 30, 2020 and December 31, 2019, for the remaining financial instruments not required to be measured or reported at fair value were as follows: September 30, 2020 Carrying Value Fair Value (Level 1) (Level 2) (Level 3) (IN THOUSANDS) FINANCIAL ASSETS: Investment securities – HTM $ 42,636 $ 45,308 $ — $ 42,311 $ 2,997 Loans held for sale 7,587 7,766 7,766 — — Loans, net of allowance for loan loss and unearned income 931,496 941,988 — — 941,988 FINANCIAL LIABILITIES: Deposits with no stated maturities 728,507 745,879 — — 745,879 Deposits with stated maturities 313,728 317,679 — — 317,679 All other borrowings (1) 94,830 100,945 — — 100,945 December 31, 2019 Carrying Value Fair Value (Level 1) (Level 2) (Level 3) (IN THOUSANDS) FINANCIAL ASSETS: Investment securities – HTM $ 39,936 $ 41,082 $ — $ 38,129 $ 2,953 Loans held for sale 4,868 4,970 4,970 — — Loans, net of allowance for loan loss and unearned income 873,427 873,908 — — 873,908 FINANCIAL LIABILITIES: Deposits with no stated maturities 651,469 631,023 — — 631,023 Deposits with stated maturities 309,044 310,734 — — 310,734 All other borrowings (1) 74,134 76,323 — — 76,323 (1) All other borrowings include advances from Federal Home Loan Bank, guaranteed junior subordinated deferrable interest debentures, and subordinated debt. |
Principles of Consolidation (De
Principles of Consolidation (Details) $ in Billions | Sep. 30, 2020USD ($)location |
Assets under Management, Carrying Amount | $ | $ 2.3 |
Pennsylvania | |
Number of locations | 15 |
Maryland | |
Number of locations | 1 |
Revenue Recognition (Details)
Revenue Recognition (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Non-interest income (in-scope of Topic 606) | $ 3,295 | $ 3,223 | $ 9,568 | $ 9,519 |
Non-interest income (out-of-scope of Topic 606) | 1,009 | 872 | 2,335 | 1,838 |
Total Non-Interest Income | 4,304 | 4,095 | 11,903 | 11,357 |
Wealth management fees | ||||
Non-interest income (in-scope of Topic 606) | 2,604 | 2,431 | 7,629 | 7,246 |
Service charges on deposit accounts | ||||
Non-interest income (in-scope of Topic 606) | 206 | 321 | 668 | 948 |
Other | ||||
Non-interest income (in-scope of Topic 606) | $ 485 | $ 471 | $ 1,271 | $ 1,325 |
Revenue Recognition - Additiona
Revenue Recognition - Additional information (Details) | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Percentage Of Entity Revenue | 79.70% |
Other assets | |
Wealth management fees receivable | $ 825,000 |
Earnings Per Common Share (Deta
Earnings Per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Numerator: | ||||
Net income | $ 1,078 | $ 1,689 | $ 3,906 | $ 5,359 |
Denominator: | ||||
Weighted average common shares outstanding (basic) | 17,059 | 17,278 | 17,051 | 17,443 |
Effect of stock options | 3 | 82 | 12 | 81 |
Weighted average common shares outstanding (diluted) | 17,062 | 17,360 | 17,063 | 17,524 |
Earnings per common share: | ||||
Basic | $ 0.06 | $ 0.10 | $ 0.23 | $ 0.31 |
Diluted | $ 0.06 | $ 0.10 | $ 0.23 | $ 0.31 |
Earnings Per Common Share - Add
Earnings Per Common Share - Additional information (Details) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 189,259 | 12,000 | 69,759 | 12,000 |
Maximum | ||||
Exercise price | $ 4.22 | $ 4.22 | $ 4.22 | $ 4.22 |
Minimum | ||||
Exercise price | $ 2.96 | $ 4.19 | $ 3.20 | $ 4.19 |
Consolidated Statement of Cas_2
Consolidated Statement of Cash Flows (Details) | 9 Months Ended | ||
Sep. 30, 2020USD ($)lease | Sep. 30, 2019USD ($) | Dec. 31, 2019USD ($) | |
Income tax payments | $ 315,000 | $ 785,000 | |
Total interest payments | 8,726,000 | 10,573,000 | |
Non-cash transfers to other real estate owned | $ 40,000 | 75,000 | |
Number of financial leases. | lease | 2 | ||
Operating Lease, Asset | $ 781,000 | $ 846,000 | |
Operating Lease, Liability | 798,000 | 865,000 | |
Finance Lease, Asset | 3,024,000 | 3,078,000 | |
Finance Lease, Liability | 3,161,000 | $ 3,163,000 | |
Office equipment leased | |||
Finance Lease, Asset | 149,000 | ||
Finance Lease, Liability | $ 149,000 | ||
Cumulative Effect, Period of Adoption, Adjustment [Member] | ASU 2016-02 | |||
Operating Lease, Asset | 932,000 | ||
Operating Lease, Liability | 932,000 | ||
Finance Lease, Asset | 3,300,000 | ||
Finance Lease, Liability | $ 3,300,000 |
Investment Securities - Cost ba
Investment Securities - Cost basis and fair values of investment securities (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Information concerning investments with unrealized gains and losses | ||
Investment securities available for sale, Cost Basis | $ 137,272 | $ 139,577 |
Investment securities available for sale, Gross Unrealized Gains | 4,846 | 2,564 |
Investment securities available for sale, Gross Unrealized Losses | (402) | (392) |
Available for Sale, Fair Value, Total | 141,716 | 141,749 |
Investment securities held to maturity, Cost Basis | 42,636 | 39,936 |
Investment securities held to maturity, Gross Unrealized Gains | 2,727 | 1,250 |
Investment securities held to maturity, Gross Unrealized Losses | (55) | (104) |
Held to Maturity, Fair Value, Total | 45,308 | 41,082 |
U.S. Agency | ||
Information concerning investments with unrealized gains and losses | ||
Investment securities available for sale, Cost Basis | 3,079 | 5,084 |
Investment securities available for sale, Gross Unrealized Gains | 197 | 32 |
Available for Sale, Fair Value, Total | 3,276 | 5,116 |
U.S. Agency mortgage-backed securities | ||
Information concerning investments with unrealized gains and losses | ||
Investment securities available for sale, Cost Basis | 66,198 | 80,046 |
Investment securities available for sale, Gross Unrealized Gains | 2,850 | 1,681 |
Investment securities available for sale, Gross Unrealized Losses | (6) | (94) |
Available for Sale, Fair Value, Total | 69,042 | 81,633 |
Investment securities held to maturity, Cost Basis | 7,719 | 9,466 |
Investment securities held to maturity, Gross Unrealized Gains | 394 | 251 |
Investment securities held to maturity, Gross Unrealized Losses | (4) | |
Held to Maturity, Fair Value, Total | 8,113 | 9,713 |
Municipal | ||
Information concerning investments with unrealized gains and losses | ||
Investment securities available for sale, Cost Basis | 17,409 | 14,678 |
Investment securities available for sale, Gross Unrealized Gains | 1,242 | 509 |
Investment securities available for sale, Gross Unrealized Losses | (17) | |
Available for Sale, Fair Value, Total | 18,651 | 15,170 |
Investment securities held to maturity, Cost Basis | 28,889 | 24,438 |
Investment securities held to maturity, Gross Unrealized Gains | 2,225 | 941 |
Investment securities held to maturity, Gross Unrealized Losses | (51) | (53) |
Held to Maturity, Fair Value, Total | 31,063 | 25,326 |
Corporate bonds | ||
Information concerning investments with unrealized gains and losses | ||
Investment securities available for sale, Cost Basis | 50,586 | 39,769 |
Investment securities available for sale, Gross Unrealized Gains | 557 | 342 |
Investment securities available for sale, Gross Unrealized Losses | (396) | (281) |
Available for Sale, Fair Value, Total | 50,747 | 39,830 |
Corporate bonds and other securities | ||
Information concerning investments with unrealized gains and losses | ||
Investment securities held to maturity, Cost Basis | 6,028 | 6,032 |
Investment securities held to maturity, Gross Unrealized Gains | 108 | 58 |
Investment securities held to maturity, Gross Unrealized Losses | (4) | (47) |
Held to Maturity, Fair Value, Total | $ 6,132 | $ 6,043 |
Investment Securities - Informa
Investment Securities - Information concerning investments with unrealized losses (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Available-For-Sale-Securities-And-Held-To-Maturity-Securities | ||
Less than 12 months, Fair Value | $ 18,223 | $ 17,150 |
Less than 12 months, Unrealized Losses | (265) | (126) |
12 months or longer, Fair Value | 7,749 | 21,468 |
12 months or longer, Unrealized Losses | (192) | (370) |
Total, Fair Value | 25,972 | 38,618 |
Total, Unrealized Losses | (457) | (496) |
U.S. Agency mortgage-backed securities | ||
Available-For-Sale-Securities-And-Held-To-Maturity-Securities | ||
Less than 12 months, Fair Value | 1,438 | 7,084 |
Less than 12 months, Unrealized Losses | (5) | (23) |
12 months or longer, Fair Value | 138 | 8,562 |
12 months or longer, Unrealized Losses | (1) | (75) |
Total, Fair Value | 1,576 | 15,646 |
Total, Unrealized Losses | (6) | (98) |
Municipal | ||
Available-For-Sale-Securities-And-Held-To-Maturity-Securities | ||
Less than 12 months, Fair Value | 1,044 | 2,269 |
Less than 12 months, Unrealized Losses | (1) | (18) |
12 months or longer, Fair Value | 752 | 1,123 |
12 months or longer, Unrealized Losses | (50) | (52) |
Total, Fair Value | 1,796 | 3,392 |
Total, Unrealized Losses | (51) | (70) |
Corporate bonds and other securities | ||
Available-For-Sale-Securities-And-Held-To-Maturity-Securities | ||
Less than 12 months, Fair Value | 15,741 | 7,797 |
Less than 12 months, Unrealized Losses | (259) | (85) |
12 months or longer, Fair Value | 6,859 | 11,783 |
12 months or longer, Unrealized Losses | (141) | (243) |
Total, Fair Value | 22,600 | 19,580 |
Total, Unrealized Losses | $ (400) | $ (328) |
Investment Securities - Total i
Investment Securities - Total investment securities (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Contractual maturities of securities | ||
Available for Sale, Cost Basis, Within 1 year | $ 5,060 | |
Available for Sale, Cost Basis, After 1 year but within 5 years | 22,222 | |
Available for Sale, Cost Basis, After 5 years but within 10 years | 48,851 | |
Available for Sale, Cost Basis, After 10 years but within 15 years | 19,253 | |
Available for Sale, Cost Basis, Over 15 years | 41,886 | |
Available for Sale, Cost Basis, Total | 137,272 | $ 139,577 |
Available for Sale, Fair Value, Within 1 year | 5,093 | |
Available for Sale, Fair Value, After 1 year but within 5 years | 22,536 | |
Available for Sale, Fair Value, After 5 years but within 10 years | 50,395 | |
Available for Sale, Fair Value, After 10 years but within 15 years | 20,120 | |
Available for Sale, Fair Value, Over 15 years | 43,572 | |
Available for Sale, Fair Value, Total | 141,716 | 141,749 |
Held to Maturity, Cost Basis, Within 1 year | 3,400 | |
Held to Maturity, Cost Basis, After 1 year but within 5 years | 7,629 | |
Held to Maturity, Cost Basis, After 5 years but within 10 years | 17,115 | |
Held to Maturity, Cost Basis, After 10 years but within 15 years | 9,395 | |
Held to Maturity, Cost Basis, Over 15 years | 5,097 | |
Held to Maturity, Cost Basis, Total | 42,636 | 39,936 |
Held to Maturity, Fair Value, Within 1 year | 3,403 | |
Held to Maturity, Fair Value, After 1 year but within 5 years | 8,054 | |
Held to Maturity, Fair Value, After 5 years but within 10 years | 18,607 | |
Held to Maturity, Fair Value, After 10 years but within 15 years | 9,946 | |
Held to Maturity, Fair Value, Over 15 years | 5,298 | |
Held to Maturity, Fair Value, Total | 45,308 | 41,082 |
U.S. Agency | ||
Contractual maturities of securities | ||
Available for Sale, Cost Basis, Total | 3,079 | 5,084 |
Available for Sale, Fair Value, Total | 3,276 | 5,116 |
U.S. Agency mortgage-backed securities | ||
Contractual maturities of securities | ||
Available for Sale, Cost Basis, Total | 66,198 | 80,046 |
Available for Sale, Fair Value, Total | 69,042 | 81,633 |
Held to Maturity, Cost Basis, Total | 7,719 | 9,466 |
Held to Maturity, Fair Value, Total | $ 8,113 | $ 9,713 |
Investment Securities - Additio
Investment Securities - Additional information (Details) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Dec. 31, 2019USD ($) | |
INVESTMENT SECURITIES | |||||
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Tax | $ 19,000 | $ 25,000 | |||
Investment Securities: | |||||
Premium percentage on mortgage backed securities purchased | 101.40% | ||||
Consolidated investment securities portfolio modified, years | 20 months 9 days | 36 months 27 days | |||
Proceeds from sales of investment securities available for sale | $ 0 | 2,800,000 | $ 0 | 3,374,000 | |
Gross investment gains | 88,000 | 118,000 | |||
Book value of securities available for sale and held to maturity | $ 113,126,000 | $ 113,126,000 | $ 117,076,000 | ||
Number of positions | 35 | 35 | |||
Available-for-sale Securities, Equity Securities | $ 424,000 | $ 424,000 | $ 366,000 | ||
Debt and Equity Securities, Gain (Loss) | $ 88,000 | $ 118,000 | |||
Standard & Poor's, AAA Rating [Member] | |||||
INVESTMENT SECURITIES | |||||
Portfolio rated | 43.50% | 43.50% | 53.40% | ||
Securities rated below A [Member] | |||||
INVESTMENT SECURITIES | |||||
Portfolio rated | 14.80% | 14.80% | 9.10% | ||
Deferred Compensation, Share-based Payments [Member] | Assets Held With Rabbi Trust [Member] | |||||
Investment Securities: | |||||
Available-for-sale Securities, Equity Securities | $ 424,000 | $ 424,000 | $ 366,000 | ||
Maximum | |||||
Investment Securities: | |||||
Consolidated investment securities portfolio modified, years | 60 months |
Loans - Loan Portfolio (Details
Loans - Loan Portfolio (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
LOANS | ||
Loans, net of unearned income | $ 941,780 | $ 882,706 |
Commercial and Industrial | ||
LOANS | ||
Loans, net of unearned income | 152,636 | |
Paycheck Protection Program (PPP) | ||
LOANS | ||
Loans, net of unearned income | 68,460 | |
Commercial loans secured by owner occupied real estate [Member] | ||
LOANS | ||
Loans, net of unearned income | 90,819 | |
Commercial loans secured by non-owner occupied real estate | ||
LOANS | ||
Loans, net of unearned income | 378,858 | |
Commercial | ||
LOANS | ||
Loans, net of unearned income | 690,773 | 629,212 |
Commercial | Commercial and Industrial | ||
LOANS | ||
Loans, net of unearned income | 152,636 | 173,922 |
Commercial | Paycheck Protection Program (PPP) | ||
LOANS | ||
Loans, net of unearned income | 68,460 | |
Commercial | Paycheck Protection Program (PPP) | Paycheck Protection Program (PPP) | ||
LOANS | ||
Loans, net of unearned income | 68,460 | |
Commercial | Commercial loans secured by owner occupied real estate [Member] | ||
LOANS | ||
Loans, net of unearned income | 90,819 | 91,655 |
Commercial | Commercial loans secured by non-owner occupied real estate | ||
LOANS | ||
Loans, net of unearned income | 378,858 | 363,635 |
Residential Portfolio Segment [Member] | Real estate-residential mortgage | ||
LOANS | ||
Loans, net of unearned income | 233,811 | 235,239 |
Consumer | ||
LOANS | ||
Loans, net of unearned income | 251,007 | 253,494 |
Consumer | Real estate-residential mortgage | ||
LOANS | ||
Loans, net of unearned income | 233,811 | 235,239 |
Consumer | Consumer [Member] | ||
LOANS | ||
Loans, net of unearned income | $ 17,196 | $ 18,255 |
Loans - Commercial real estate
Loans - Commercial real estate loans (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
LOANS | ||
Loans, net of unearned income | $ 941,780 | $ 882,706 |
1-4 unit residential | ||
LOANS | ||
Loans, net of unearned income | 7,515 | |
Multifamily/apartments/student housing | ||
LOANS | ||
Loans, net of unearned income | 55,381 | |
Office | ||
LOANS | ||
Loans, net of unearned income | 87,244 | |
Retail | ||
LOANS | ||
Loans, net of unearned income | 147,826 | |
Industrial/manufacturing/warehouse | ||
LOANS | ||
Loans, net of unearned income | 179,689 | |
Hotels | ||
LOANS | ||
Loans, net of unearned income | 43,489 | |
Eating and drinking places | ||
LOANS | ||
Loans, net of unearned income | 19,447 | |
Amusement and recreation | ||
LOANS | ||
Loans, net of unearned income | 3,742 | |
Mixed use | ||
LOANS | ||
Loans, net of unearned income | 69,237 | |
Other | ||
LOANS | ||
Loans, net of unearned income | 77,203 | |
Commercial and Industrial | ||
LOANS | ||
Loans, net of unearned income | 152,636 | |
Commercial and Industrial | 1-4 unit residential | ||
LOANS | ||
Loans, net of unearned income | 1,488 | |
Commercial and Industrial | Office | ||
LOANS | ||
Loans, net of unearned income | 32,793 | |
Commercial and Industrial | Retail | ||
LOANS | ||
Loans, net of unearned income | 7,997 | |
Commercial and Industrial | Industrial/manufacturing/warehouse | ||
LOANS | ||
Loans, net of unearned income | 89,382 | |
Commercial and Industrial | Hotels | ||
LOANS | ||
Loans, net of unearned income | 372 | |
Commercial and Industrial | Eating and drinking places | ||
LOANS | ||
Loans, net of unearned income | 855 | |
Commercial and Industrial | Amusement and recreation | ||
LOANS | ||
Loans, net of unearned income | 245 | |
Commercial and Industrial | Other | ||
LOANS | ||
Loans, net of unearned income | 19,504 | |
Paycheck Protection Program (PPP) | ||
LOANS | ||
Loans, net of unearned income | 68,460 | |
Paycheck Protection Program (PPP) | Office | ||
LOANS | ||
Loans, net of unearned income | 9,924 | |
Paycheck Protection Program (PPP) | Retail | ||
LOANS | ||
Loans, net of unearned income | 1,786 | |
Paycheck Protection Program (PPP) | Industrial/manufacturing/warehouse | ||
LOANS | ||
Loans, net of unearned income | 29,463 | |
Paycheck Protection Program (PPP) | Hotels | ||
LOANS | ||
Loans, net of unearned income | 1,287 | |
Paycheck Protection Program (PPP) | Eating and drinking places | ||
LOANS | ||
Loans, net of unearned income | 13,630 | |
Paycheck Protection Program (PPP) | Amusement and recreation | ||
LOANS | ||
Loans, net of unearned income | 106 | |
Paycheck Protection Program (PPP) | Other | ||
LOANS | ||
Loans, net of unearned income | 12,264 | |
Commercial loans secured by owner occupied real estate [Member] | ||
LOANS | ||
Loans, net of unearned income | 90,819 | |
Commercial loans secured by owner occupied real estate [Member] | 1-4 unit residential | ||
LOANS | ||
Loans, net of unearned income | 107 | |
Commercial loans secured by owner occupied real estate [Member] | Multifamily/apartments/student housing | ||
LOANS | ||
Loans, net of unearned income | 418 | |
Commercial loans secured by owner occupied real estate [Member] | Office | ||
LOANS | ||
Loans, net of unearned income | 10,075 | |
Commercial loans secured by owner occupied real estate [Member] | Retail | ||
LOANS | ||
Loans, net of unearned income | 21,213 | |
Commercial loans secured by owner occupied real estate [Member] | Industrial/manufacturing/warehouse | ||
LOANS | ||
Loans, net of unearned income | 17,751 | |
Commercial loans secured by owner occupied real estate [Member] | Eating and drinking places | ||
LOANS | ||
Loans, net of unearned income | 4,424 | |
Commercial loans secured by owner occupied real estate [Member] | Amusement and recreation | ||
LOANS | ||
Loans, net of unearned income | 3,345 | |
Commercial loans secured by owner occupied real estate [Member] | Mixed use | ||
LOANS | ||
Loans, net of unearned income | 2,802 | |
Commercial loans secured by owner occupied real estate [Member] | Other | ||
LOANS | ||
Loans, net of unearned income | 30,684 | |
Commercial loans secured by non-owner occupied real estate | ||
LOANS | ||
Loans, net of unearned income | 378,858 | |
Commercial loans secured by non-owner occupied real estate | 1-4 unit residential | ||
LOANS | ||
Loans, net of unearned income | 5,920 | |
Commercial loans secured by non-owner occupied real estate | Multifamily/apartments/student housing | ||
LOANS | ||
Loans, net of unearned income | 54,963 | |
Commercial loans secured by non-owner occupied real estate | Office | ||
LOANS | ||
Loans, net of unearned income | 34,452 | |
Commercial loans secured by non-owner occupied real estate | Retail | ||
LOANS | ||
Loans, net of unearned income | 116,830 | |
Commercial loans secured by non-owner occupied real estate | Industrial/manufacturing/warehouse | ||
LOANS | ||
Loans, net of unearned income | 43,093 | |
Commercial loans secured by non-owner occupied real estate | Hotels | ||
LOANS | ||
Loans, net of unearned income | 41,830 | |
Commercial loans secured by non-owner occupied real estate | Eating and drinking places | ||
LOANS | ||
Loans, net of unearned income | 538 | |
Commercial loans secured by non-owner occupied real estate | Amusement and recreation | ||
LOANS | ||
Loans, net of unearned income | 46 | |
Commercial loans secured by non-owner occupied real estate | Mixed use | ||
LOANS | ||
Loans, net of unearned income | 66,435 | |
Commercial loans secured by non-owner occupied real estate | Other | ||
LOANS | ||
Loans, net of unearned income | 14,751 | |
Commercial | ||
LOANS | ||
Loans, net of unearned income | 690,773 | |
Commercial | ||
LOANS | ||
Loans, net of unearned income | 690,773 | 629,212 |
Commercial | Commercial and Industrial | ||
LOANS | ||
Loans, net of unearned income | 152,636 | 173,922 |
Commercial | Paycheck Protection Program (PPP) | ||
LOANS | ||
Loans, net of unearned income | 68,460 | |
Commercial | Commercial loans secured by owner occupied real estate [Member] | ||
LOANS | ||
Loans, net of unearned income | 90,819 | 91,655 |
Commercial | Commercial loans secured by non-owner occupied real estate | ||
LOANS | ||
Loans, net of unearned income | 378,858 | 363,635 |
Consumer | ||
LOANS | ||
Loans, net of unearned income | $ 251,007 | $ 253,494 |
Loans - Additional information
Loans - Additional information (Details) | Mar. 27, 2020USD ($)item | Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Dec. 31, 2019USD ($) |
LOANS | ||||||
Real estate-construction loans, percentage | 6.40% | 6.40% | 4.90% | |||
Loan balances net of unearned income | $ 1,466,000 | $ 1,466,000 | $ 384,000 | |||
Unrecognized fee income from the PPP loan originations | 1,057,000 | 1,057,000 | ||||
Fee Income from Loans | 9,724,000 | $ 10,737,000 | $ 30,504,000 | $ 32,149,000 | ||
Paycheck Protection Program (PPP) | ||||||
LOANS | ||||||
Number of times of average monthly payroll costs | item | 2.5 | |||||
Loan amount | $ 10,000,000 | |||||
Interest rate | 1.00% | |||||
Percentage of guarantee by SBA | 100.00% | |||||
Percentage of loan proceeds used for payroll expenses | 60.00% | |||||
Loans Receivable, Number Of Applications Received | 469 | |||||
Loans Receivable, Excess Of Loan Application Received | $ 68,500,000 | $ 68,500,000 | ||||
Fee Income from Loans | 1,400,000 | |||||
Processing fee | $ 1,100,000 | |||||
Paycheck Protection Program (PPP) | originated prior to June 5, 2020 | ||||||
LOANS | ||||||
Loan term | 2 years | |||||
Paycheck Protection Program (PPP) | originated after June 5, 2020 | ||||||
LOANS | ||||||
Loan term | 5 years |
Allowance for Loan Losses - Loa
Allowance for Loan Losses - Loan losses by portfolio segment (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Balance at Beginning of Period | $ 9,699 | $ 8,102 | $ 9,279 | $ 8,671 |
Charge-Offs | (144) | (37) | (417) | (341) |
Recoveries | 54 | 55 | 122 | 190 |
Provision (Credit) | 675 | 225 | 1,300 | (175) |
Balance at End of Period | 10,284 | 8,345 | 10,284 | 8,345 |
Allocation for General Risk [Member] | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Balance at Beginning of Period | 961 | 797 | 924 | 863 |
Charge-Offs | 0 | 0 | 0 | 0 |
Recoveries | 0 | 0 | 0 | 0 |
Provision (Credit) | 52 | (140) | 89 | (206) |
Balance at End of Period | 1,013 | 657 | 1,013 | 657 |
Commercial | Commercial | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Balance at Beginning of Period | 3,784 | 2,538 | 3,951 | 3,057 |
Charge-Offs | (111) | (1) | (111) | (1) |
Recoveries | 1 | 8 | 1 | 13 |
Provision (Credit) | (638) | 464 | (805) | (60) |
Balance at End of Period | 3,036 | 3,009 | 3,036 | 3,009 |
Commercial | Commercial loans secured by non-owner occupied real estate | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Balance at Beginning of Period | 3,619 | 3,425 | 3,119 | 3,389 |
Charge-Offs | 0 | 0 | 0 | (63) |
Recoveries | 10 | 12 | 31 | 36 |
Provision (Credit) | 1,261 | (81) | 1,740 | (6) |
Balance at End of Period | 4,890 | 3,356 | 4,890 | 3,356 |
Consumer | Real estate-residential mortgage | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Balance at Beginning of Period | 1,216 | 1,218 | 1,159 | 1,235 |
Charge-Offs | (19) | 0 | (201) | (71) |
Recoveries | 24 | 25 | 46 | 101 |
Provision (Credit) | 4 | (46) | 221 | (68) |
Balance at End of Period | 1,225 | 1,197 | 1,225 | 1,197 |
Consumer | Consumer [Member] | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Balance at Beginning of Period | 119 | 124 | 126 | 127 |
Charge-Offs | (14) | (36) | (105) | (206) |
Recoveries | 19 | 10 | 44 | 40 |
Provision (Credit) | (4) | 28 | 55 | 165 |
Balance at End of Period | $ 120 | $ 126 | $ 120 | $ 126 |
Allowance for Loan Losses - L_2
Allowance for Loan Losses - Loan loss by the primary segments (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Jun. 30, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2018 |
Loans: | ||||||
Individually evaluated for impairment | $ 867 | $ 824 | ||||
Collectively evaluated for impairment | 940,913 | 881,882 | ||||
Total loans | 941,780 | 882,706 | ||||
Allowance for loan losses: | ||||||
Specific reserve allocation | 106 | 92 | ||||
General reserve allocation | 10,178 | 9,187 | ||||
Total allowance for loan losses | 10,284 | $ 9,699 | 9,279 | $ 8,345 | $ 8,102 | $ 8,671 |
Commercial loans secured by non-owner occupied real estate | ||||||
Loans: | ||||||
Total loans | 378,858 | |||||
Allocation for General Risk [Member] | ||||||
Loans: | ||||||
Individually evaluated for impairment | 0 | |||||
Collectively evaluated for impairment | 0 | |||||
Total loans | 0 | |||||
Allowance for loan losses: | ||||||
Specific reserve allocation | 0 | 0 | ||||
General reserve allocation | 1,013 | 924 | ||||
Total allowance for loan losses | 1,013 | 961 | 924 | 657 | 797 | 863 |
Commercial | ||||||
Loans: | ||||||
Total loans | 690,773 | 629,212 | ||||
Commercial | Commercial | ||||||
Loans: | ||||||
Individually evaluated for impairment | 859 | 816 | ||||
Collectively evaluated for impairment | 311,056 | 264,761 | ||||
Total loans | 311,915 | 265,577 | ||||
Allowance for loan losses: | ||||||
Specific reserve allocation | 98 | 84 | ||||
General reserve allocation | 2,938 | 3,867 | ||||
Total allowance for loan losses | 3,036 | 3,784 | 3,951 | 3,009 | 2,538 | 3,057 |
Commercial | Commercial loans secured by non-owner occupied real estate | ||||||
Loans: | ||||||
Individually evaluated for impairment | 8 | 8 | ||||
Collectively evaluated for impairment | 378,850 | 363,627 | ||||
Total loans | 378,858 | 363,635 | ||||
Allowance for loan losses: | ||||||
Specific reserve allocation | 8 | 8 | ||||
General reserve allocation | 4,882 | 3,111 | ||||
Total allowance for loan losses | 4,890 | 3,619 | 3,119 | 3,356 | 3,425 | 3,389 |
Consumer | ||||||
Loans: | ||||||
Total loans | 251,007 | 253,494 | ||||
Consumer | Real estate-residential mortgage | ||||||
Loans: | ||||||
Individually evaluated for impairment | 0 | 0 | ||||
Collectively evaluated for impairment | 233,811 | 235,239 | ||||
Total loans | 233,811 | 235,239 | ||||
Allowance for loan losses: | ||||||
Specific reserve allocation | 0 | 0 | ||||
General reserve allocation | 1,225 | 1,159 | ||||
Total allowance for loan losses | 1,225 | 1,216 | 1,159 | 1,197 | 1,218 | 1,235 |
Consumer | Consumer [Member] | ||||||
Loans: | ||||||
Individually evaluated for impairment | 0 | 0 | ||||
Collectively evaluated for impairment | 17,196 | 18,255 | ||||
Total loans | 17,196 | 18,255 | ||||
Allowance for loan losses: | ||||||
Specific reserve allocation | 0 | 0 | ||||
General reserve allocation | 120 | 126 | ||||
Total allowance for loan losses | $ 120 | $ 119 | $ 126 | $ 126 | $ 124 | $ 127 |
Allowance for Loan Losses - Pre
Allowance for Loan Losses - Present impaired loans by portfolio segment (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Recorded Investment | $ 867 | $ 824 |
Related Allowance | 8 | 8 |
Unpaid Principal Balance | 889 | 846 |
Impaired Loans with Specific Allowance | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Recorded Investment | 867 | 824 |
Related Allowance | 106 | 92 |
Impaired Loans With No Specific Allowance | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Recorded Investment | 0 | 0 |
Commercial | Commercial | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Recorded Investment | 859 | 816 |
Unpaid Principal Balance | 859 | 816 |
Commercial | Commercial loans secured by non-owner occupied real estate | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Recorded Investment | 8 | 8 |
Unpaid Principal Balance | 30 | 30 |
Commercial | Impaired Loans with Specific Allowance | Commercial | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Recorded Investment | 859 | 816 |
Related Allowance | 98 | 84 |
Commercial | Impaired Loans with Specific Allowance | Commercial loans secured by non-owner occupied real estate | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Recorded Investment | 8 | 8 |
Related Allowance | 8 | 8 |
Commercial | Impaired Loans With No Specific Allowance | Commercial | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Recorded Investment | 0 | 0 |
Commercial | Impaired Loans With No Specific Allowance | Commercial loans secured by non-owner occupied real estate | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Recorded Investment | $ 0 | $ 0 |
Allowance for Loan Losses - Inv
Allowance for Loan Losses - Investment in impaired loans and related interest income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Average loan balance: | ||||
Average investment in impaired loans | $ 847 | $ 795 | $ 840 | $ 403 |
Interest income recognized: | ||||
Interest income recognized on a cash basis on impaired loans | 9 | 13 | 31 | 17 |
Commercial | Commercial | ||||
Average loan balance: | ||||
Average investment in impaired loans | 839 | 785 | 832 | 393 |
Interest income recognized: | ||||
Interest income recognized on a cash basis on impaired loans | 9 | 13 | 31 | 17 |
Commercial | Commercial loans secured by non-owner occupied real estate | ||||
Average loan balance: | ||||
Average investment in impaired loans | 8 | 10 | 8 | 10 |
Interest income recognized: | ||||
Interest income recognized on a cash basis on impaired loans | $ 0 | $ 0 | $ 0 | $ 0 |
Allowance for Loan Losses - Com
Allowance for Loan Losses - Commercial and commercial real estate loan portfolios (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | $ 941,780 | $ 882,706 |
Paycheck Protection Program (PPP) | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 68,460 | |
Commercial loans secured by owner occupied real estate [Member] | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 90,819 | |
Commercial loans secured by non-owner occupied real estate | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 378,858 | |
Commercial | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 690,773 | 629,212 |
Commercial | Commercial and Industrial Loan [Member] | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 152,636 | 173,922 |
Commercial | Paycheck Protection Program (PPP) | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 68,460 | |
Commercial | Commercial loans secured by owner occupied real estate [Member] | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 90,819 | 91,655 |
Commercial | Commercial loans secured by non-owner occupied real estate | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 378,858 | 363,635 |
Commercial | Pass | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 649,153 | 612,116 |
Commercial | Pass | Commercial and Industrial Loan [Member] | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 142,948 | 161,147 |
Commercial | Pass | Paycheck Protection Program (PPP) | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 68,460 | |
Commercial | Pass | Commercial loans secured by owner occupied real estate [Member] | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 87,844 | 88,942 |
Commercial | Pass | Commercial loans secured by non-owner occupied real estate | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 349,901 | 362,027 |
Commercial | Special Mention | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 35,697 | 2,237 |
Commercial | Special Mention | Commercial and Industrial Loan [Member] | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 6,336 | 853 |
Commercial | Special Mention | Commercial loans secured by owner occupied real estate [Member] | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 1,889 | 1,384 |
Commercial | Special Mention | Commercial loans secured by non-owner occupied real estate | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 27,472 | |
Commercial | Substandard [Member] | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 5,915 | 14,851 |
Commercial | Substandard [Member] | Commercial and Industrial Loan [Member] | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 3,352 | 11,922 |
Commercial | Substandard [Member] | Commercial loans secured by owner occupied real estate [Member] | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 1,086 | 1,329 |
Commercial | Substandard [Member] | Commercial loans secured by non-owner occupied real estate | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 1,477 | 1,600 |
Commercial | Doubtful [Member] | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 8 | 8 |
Commercial | Doubtful [Member] | Commercial and Industrial Loan [Member] | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 0 | |
Commercial | Doubtful [Member] | Commercial loans secured by owner occupied real estate [Member] | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | 0 | |
Commercial | Doubtful [Member] | Commercial loans secured by non-owner occupied real estate | ||
Loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the internal risk rating system | ||
Loan portfolio | $ 8 | $ 8 |
Allowance for Loan Losses - Res
Allowance for Loan Losses - Residential and consumer portfolio (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Performing and non-performing outstanding balances of the residential and consumer portfolios | ||
Loan portfolio | $ 941,780 | $ 882,706 |
Consumer | ||
Performing and non-performing outstanding balances of the residential and consumer portfolios | ||
Loan portfolio | 251,007 | 253,494 |
Real estate-residential mortgage | Consumer | ||
Performing and non-performing outstanding balances of the residential and consumer portfolios | ||
Loan portfolio | 233,811 | 235,239 |
Consumer [Member] | Consumer | ||
Performing and non-performing outstanding balances of the residential and consumer portfolios | ||
Loan portfolio | 17,196 | 18,255 |
Performing [Member] | Consumer | ||
Performing and non-performing outstanding balances of the residential and consumer portfolios | ||
Loan portfolio | 249,311 | 252,015 |
Performing [Member] | Real estate-residential mortgage | Consumer | ||
Performing and non-performing outstanding balances of the residential and consumer portfolios | ||
Loan portfolio | 232,115 | 233,760 |
Performing [Member] | Consumer [Member] | Consumer | ||
Performing and non-performing outstanding balances of the residential and consumer portfolios | ||
Loan portfolio | 17,196 | 18,255 |
Non-Performing [Member] | Consumer | ||
Performing and non-performing outstanding balances of the residential and consumer portfolios | ||
Loan portfolio | 1,696 | 1,479 |
Non-Performing [Member] | Real estate-residential mortgage | Consumer | ||
Performing and non-performing outstanding balances of the residential and consumer portfolios | ||
Loan portfolio | 1,696 | 1,479 |
Non-Performing [Member] | Consumer [Member] | Consumer | ||
Performing and non-performing outstanding balances of the residential and consumer portfolios | ||
Loan portfolio | $ 0 | $ 0 |
Allowance for Loan Losses - Cre
Allowance for Loan Losses - Credit quality of the loan portfolio (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Current | $ 937,702,000 | $ 878,307,000 |
Total Past Due | 4,078,000 | 4,399,000 |
Total loans | 941,780,000 | 882,706,000 |
90 Days Past Due and Still Accruing | 0 | 0 |
30-59 Days Past Due [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total Past Due | 2,040,000 | 2,490,000 |
60-89 Days Past Due [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total Past Due | 1,039,000 | 887,000 |
90 Days Past Due [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total Past Due | 999,000 | 1,022,000 |
Commercial and Industrial | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total loans | 152,636,000 | |
Paycheck Protection Program (PPP) | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total loans | 68,460,000 | |
Commercial loans secured by owner occupied real estate [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total loans | 90,819,000 | |
Commercial loans secured by non-owner occupied real estate | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total loans | 378,858,000 | |
Commercial | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total loans | 690,773,000 | 629,212,000 |
Commercial | Commercial and Industrial | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Current | 152,558,000 | 173,922,000 |
Total Past Due | 78,000 | 0 |
Total loans | 152,636,000 | 173,922,000 |
90 Days Past Due and Still Accruing | 0 | 0 |
Commercial | Commercial and Industrial | 30-59 Days Past Due [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total Past Due | 78,000 | 0 |
Commercial | Commercial and Industrial | 60-89 Days Past Due [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total Past Due | 0 | 0 |
Commercial | Commercial and Industrial | 90 Days Past Due [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total Past Due | 0 | 0 |
Commercial | Paycheck Protection Program (PPP) | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Current | 68,460,000 | |
Total Past Due | 0 | |
Total loans | 68,460,000 | |
90 Days Past Due and Still Accruing | 0 | |
Commercial | Paycheck Protection Program (PPP) | 30-59 Days Past Due [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total Past Due | 0 | |
Commercial | Paycheck Protection Program (PPP) | 60-89 Days Past Due [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total Past Due | 0 | |
Commercial | Paycheck Protection Program (PPP) | 90 Days Past Due [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total Past Due | 0 | |
Commercial | Commercial loans secured by owner occupied real estate [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Current | 90,819,000 | 91,538,000 |
Total Past Due | 0 | 117,000 |
Total loans | 90,819,000 | 91,655,000 |
90 Days Past Due and Still Accruing | 0 | 0 |
Commercial | Commercial loans secured by owner occupied real estate [Member] | 30-59 Days Past Due [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total Past Due | 0 | 117,000 |
Commercial | Commercial loans secured by owner occupied real estate [Member] | 60-89 Days Past Due [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total Past Due | 0 | 0 |
Commercial | Commercial loans secured by owner occupied real estate [Member] | 90 Days Past Due [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total Past Due | 0 | 0 |
Commercial | Commercial loans secured by non-owner occupied real estate | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Current | 378,858,000 | 363,635,000 |
Total Past Due | 0 | 0 |
Total loans | 378,858,000 | 363,635,000 |
90 Days Past Due and Still Accruing | 0 | 0 |
Commercial | Commercial loans secured by non-owner occupied real estate | 30-59 Days Past Due [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total Past Due | 0 | 0 |
Commercial | Commercial loans secured by non-owner occupied real estate | 60-89 Days Past Due [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total Past Due | 0 | 0 |
Commercial | Commercial loans secured by non-owner occupied real estate | 90 Days Past Due [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total Past Due | 0 | 0 |
Consumer | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total loans | 251,007,000 | 253,494,000 |
Consumer | Real estate-residential mortgage | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Current | 229,851,000 | 231,022,000 |
Total Past Due | 3,960,000 | 4,217,000 |
Total loans | 233,811,000 | 235,239,000 |
90 Days Past Due and Still Accruing | 0 | 0 |
Consumer | Real estate-residential mortgage | 30-59 Days Past Due [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total Past Due | 1,922,000 | 2,331,000 |
Consumer | Real estate-residential mortgage | 60-89 Days Past Due [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total Past Due | 1,039,000 | 864,000 |
Consumer | Real estate-residential mortgage | 90 Days Past Due [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total Past Due | 999,000 | 1,022,000 |
Consumer | Consumer [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Current | 17,156,000 | 18,190,000 |
Total Past Due | 40,000 | 65,000 |
Total loans | 17,196,000 | 18,255,000 |
90 Days Past Due and Still Accruing | 0 | 0 |
Consumer | Consumer [Member] | 30-59 Days Past Due [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total Past Due | 40,000 | 42,000 |
Consumer | Consumer [Member] | 60-89 Days Past Due [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total Past Due | 0 | 23,000 |
Consumer | Consumer [Member] | 90 Days Past Due [Member] | ||
Classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans | ||
Total Past Due | $ 0 | $ 0 |
Allowance for Loan Losses - Add
Allowance for Loan Losses - Additional information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Provision expense for loan losses | $ 675,000 | $ 225,000 | $ 1,300,000 | $ (175,000) | |
Net unfavorable shift | $ 1,475,000 | ||||
Reserve coverage of total loans, excluding PPP loans | 1.17% | 1.17% | |||
provision recovery recorded | $ (675,000) | (225,000) | $ (1,300,000) | 175,000 | |
Financing Receivable, Individually Evaluated for Impairment | $ 867,000 | 867,000 | $ 824,000 | ||
Debt Instrument Non Performing Assets | $ 2,600,000 | ||||
Percentage Of Allowance For Total Loans | 1.08% | 1.08% | 1.05% | ||
Non-performing assets as a percent of loans | 0.27% | 0.27% | 0.26% | ||
Allowance for Loan and Lease Losses Write-offs, Net | $ 295,000 | $ 151,000 | |||
Allowance For Loan And Lease Losses Write Off Percentage | 0.04% | 0.02% | |||
Percentage Of Allowance For Non Performing Assets | 395.00% | 395.00% | 397.00% | ||
Financing Receivable, Recorded Investment, Past Due | $ 4,078,000 | $ 4,078,000 | $ 4,399,000 | ||
Hotel industry | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Provision expense for loan losses | 29,000,000 | ||||
Pass | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Minimum individual loan balance requiring quarterly review | 2,000,000 | 2,000,000 | |||
Special Mention | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Minimum individual loan balance requiring quarterly review | 250,000 | 250,000 | |||
Substandard [Member] | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Minimum individual loan balance requiring quarterly review | 250,000 | 250,000 | |||
Doubtful [Member] | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Minimum individual loan balance requiring quarterly review | 100,000 | 100,000 | |||
Commercial | Commercial | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
provision recovery recorded | 638,000 | $ (464,000) | 805,000 | $ 60,000 | |
Financing Receivable, Individually Evaluated for Impairment | 859,000 | 859,000 | 816,000 | ||
Minimum aggregate balances for commercial loan relationship under structure loan rating process | 1,000,000 | 1,000,000 | |||
Commercial | Commercial and Industrial | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Financing Receivable, Recorded Investment, Past Due | 78,000 | $ 78,000 | $ 0 | ||
Commercial | Minimum | Commercial | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Minimum percent of portfolio to be reviewed | 40.00% | ||||
Consumer | Minimum | Consumer and Residential Mortgage Loans [Member] | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Financing Receivable, Individually Evaluated for Impairment | $ 150,000 | $ 150,000 |
Non-Performing Assets Includi_3
Non-Performing Assets Including Troubled Debt Restructurings (TDR) (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Non-Performing assets including TDR | ||
Non-accrual loans | $ 1,724 | $ 1,487 |
Other real estate owned | 40 | 37 |
TDR's not in non-accrual | 839 | 815 |
Total non-performing assets including TDR | $ 2,603 | $ 2,339 |
Total non-performing assets as a percent of loans, net of unearned income, and other real estate owned | 0.27% | 0.26% |
Commercial and Industrial | ||
Non-Performing assets including TDR | ||
Non-accrual loans | $ 20 | |
TDR's not in non-accrual | 839 | $ 815 |
Commercial loans secured by non-owner occupied real estate | ||
Non-Performing assets including TDR | ||
Non-accrual loans | 8 | 8 |
Real estate-residential mortgage | ||
Non-Performing assets including TDR | ||
Non-accrual loans | 1,696 | 1,479 |
Other real estate owned | $ 40 | $ 37 |
Non-Performing Assets Includi_4
Non-Performing Assets Including Troubled Debt Restructurings (TDR) - Interest income due in accordance (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Schedule of Interest Income | ||||
Interest income due in accordance with original terms | $ 22 | $ 14 | $ 60 | $ 43 |
Interest income recorded | 0 | 0 | 0 | 0 |
Net reduction in interest income | $ 22 | $ 14 | $ 60 | $ 43 |
Non-Performing Assets Includi_5
Non-Performing Assets Including Troubled Debt Restructurings (TDR) - Loans in accrual and non-accrual status (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020USD ($)loan | Sep. 30, 2019USD ($)loan | Sep. 30, 2020USD ($)loan | Sep. 30, 2019USD ($)loan | Dec. 31, 2019loan | |
Schedule of TDRs | |||||
TDR subsequently default | 0 | ||||
Loans in accrual status [Member] | Commercial and Industrial | |||||
Schedule of TDRs | |||||
Number of loans | 1 | 1 | 1 | 2 | |
Current Balance | $ | $ 47 | $ 70 | $ 47 | $ 820 | |
Concession Granted | Extension of maturity date with a below market interest rate | Extension of maturity date with a below market interest rate | Extension of maturity date with a below market interest rate | Extension of maturity date with a below market interest rate | |
Loans in accrual status [Member] | Commercial and Industrial | Subsequent modification of a TDR | |||||
Schedule of TDRs | |||||
Number of loans | 1 | ||||
Current Balance | $ | $ 750 |
Non-Performing Assets Includi_6
Non-Performing Assets Including Troubled Debt Restructurings (TDR) - concentration of COVID-19 related modifications within the loan portfolio (Details) - USD ($) $ in Thousands | 6 Months Ended | 9 Months Ended |
Jun. 30, 2020 | Sep. 30, 2020 | |
Financing Receivable, Modifications [Line Items] | ||
Loans For Which Payment Relief Has Been Requested | $ 200,005 | $ 144,361 |
% of Outstanding Non-PPP Loans | 23.20% | 16.40% |
CRE | Commercial | ||
Financing Receivable, Modifications [Line Items] | ||
Loans For Which Payment Relief Has Been Requested | $ 190,276 | $ 140,132 |
% of Outstanding Non-PPP Loans | 30.40% | 21.80% |
Home Equity | Consumer | ||
Financing Receivable, Modifications [Line Items] | ||
Loans For Which Payment Relief Has Been Requested | $ 5,890 | $ 160 |
% of Outstanding Non-PPP Loans | 6.00% | 0.20% |
Real estate-residential mortgage | ||
Financing Receivable, Modifications [Line Items] | ||
Loans For Which Payment Relief Has Been Requested | $ 3,839 | $ 4,069 |
% of Outstanding Non-PPP Loans | 2.80% | 2.90% |
Non-Performing Assets Includi_7
Non-Performing Assets Including Troubled Debt Restructurings (TDR) - types of payment relief that have been granted (Details) $ in Thousands | 6 Months Ended | 9 Months Ended | |
Jun. 30, 2020USD ($)loan | Sep. 30, 2020USD ($)loan | Dec. 31, 2019USD ($) | |
Financing Receivable, Modifications [Line Items] | |||
Loans, net of unearned income | $ 941,780 | $ 882,706 | |
Number of loans | loan | 383 | 194 | |
Payment relief that have been granted | $ 200,005 | $ 144,361 | |
Interest only payments | |||
Financing Receivable, Modifications [Line Items] | |||
Number of loans | loan | 83 | 67 | |
Payment relief that have been granted | $ 87,881 | $ 74,680 | |
Complete payment deferrals | |||
Financing Receivable, Modifications [Line Items] | |||
Number of loans | loan | 296 | 127 | |
Payment relief that have been granted | $ 103,378 | $ 69,681 | |
Maturity date extensions | |||
Financing Receivable, Modifications [Line Items] | |||
Number of loans | loan | 4 | ||
Payment relief that have been granted | $ 8,746 | ||
Commercial and Industrial | |||
Financing Receivable, Modifications [Line Items] | |||
Loans, net of unearned income | 152,636 | ||
Commercial and Industrial | Complete payment deferrals | |||
Financing Receivable, Modifications [Line Items] | |||
Loans, net of unearned income | $ 2,500 | ||
Number of loans | loan | 1 | ||
Paycheck Protection Program (PPP) | |||
Financing Receivable, Modifications [Line Items] | |||
Loans, net of unearned income | $ 68,460 | ||
Commercial loans secured by owner occupied real estate [Member] | |||
Financing Receivable, Modifications [Line Items] | |||
Loans, net of unearned income | 90,819 | ||
Commercial loans secured by non-owner occupied real estate | |||
Financing Receivable, Modifications [Line Items] | |||
Loans, net of unearned income | $ 378,858 |
Non-Performing Assets Includi_8
Non-Performing Assets Including Troubled Debt Restructurings (TDR) - Additional information (Details) - USD ($) | 1 Months Ended | 9 Months Ended | ||
Oct. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Dec. 31, 2019 | |
Non-Performing Assets Including Troubled Debt Restructurings (TDR) | ||||
ALL reserve for TDR's | $ 104,000 | $ 92,000 | ||
Decrease in loan modifications to COVID-19 | $ (63,400,000) | $ (55,600,000) | ||
Percentage of decrease in balance of loan modifications | 43.90% | 27.80% | ||
Accrued interest receivable due to loan modification | $ 2,400,000 | |||
Balance of loans modified | $ 80,900,000 | $ 200,000,000 | ||
Loans 90 Days Past Due accruing interest | $ 0 | $ 0 |
Short-Term and Federal Home L_3
Short-Term and Federal Home Loan Bank Borrowings (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Federal Home Loan Bank (FHLB) borrowings and advances | ||
Open Repo Plus | $ 5,894 | $ 22,412 |
FHLB Advances 2020, Amount | 11,187 | 18,729 |
FHLB Advances 2021, Amount | 22,496 | 9,496 |
FHLB Advances 2022, Amount | 20,888 | 17,838 |
FHLB Advances 2023, Amount | 15,568 | 5,568 |
FHLB Advances 2024, Amount | 4,197 | 2,037 |
Total FHLB advances | 74,336 | 53,668 |
Total short-term and FHLB borrowings, Amount | $ 80,230 | $ 76,080 |
Open Repo Plus Maturity Overnight, Weighted Average Rate | 1.81% | |
FHLB Advances Maturing 2020, Weighted Average Rate | 0.95% | 1.75% |
FHLB Advances Maturing 2021, Weighted Average Rate | 1.08% | 2.28% |
FHLB Advances Maturing 2022, Weighted Average Rate | 2.03% | 2.21% |
FHLB Advances Maturing 2023, Weighted Average Rate | 1.59% | 2.48% |
FHLB Advances Maturing 2024, Weighted Average Rate | 1.19% | 1.86% |
Total FHLB advances, Weighted Average Rate | 1.44% | 2.08% |
Total short-term and FHLB borrowings, Weighted Average Rate | 1.37% | 2.00% |
Federal Funds Purchased | ||
Federal Home Loan Bank (FHLB) borrowings and advances | ||
Open Repo Plus | $ 2,000 | |
Open Repo Plus Maturity Overnight, Weighted Average Rate | 0.65% | |
Open Repo Plus | ||
Federal Home Loan Bank (FHLB) borrowings and advances | ||
Open Repo Plus | $ 3,894 | |
Open Repo Plus Maturity Overnight, Weighted Average Rate | 0.39% |
Lease Commitments (Details)
Lease Commitments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Lease Commitments | ||||
Amortization of right-of-use asset | $ 68 | $ 64 | $ 203 | $ 193 |
Interest expense | 28 | 29 | 85 | 88 |
Operating lease cost | 29 | 29 | 87 | 87 |
Total lease cost | $ 125 | $ 122 | $ 375 | $ 368 |
Lease Commitments - Leases outs
Lease Commitments - Leases outstanding - (Details) | Sep. 30, 2020 | Dec. 31, 2019 |
Lease Commitments | ||
Operating Lease, Weighted-average remaining term | 11 years 6 months | 11 years 10 months 24 days |
Financing Lease, Weighted-average remaining term | 16 years 1 month 6 days | 17 years 1 month 6 days |
Operating Lease, Weighted-average discount rate | 3.48% | 3.46% |
Financing Lease, Weighted-average discount rate | 3.51% | 3.60% |
Lease Commitments - Operating a
Lease Commitments - Operating and financing leases - (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Dec. 31, 2019 | |
Lease Commitments | ||
Operating lease, Within 1 year | $ 119 | $ 118 |
Operating lease, After 1 year but within 2 years | 110 | 120 |
Operating lease, After 2 years but within 3 years | 69 | 98 |
Operating lease, After 3 years but within 4 years | 69 | 69 |
Operating lease, After 4 years but within 5 years | 69 | 69 |
Operating lease, After 5 years | 539 | 589 |
Total undiscounted cash flows | 975 | 1,063 |
Discount on cash flows | (177) | (198) |
Total lease liabilities | 798 | 865 |
Financing lease, Within 1 year | 316 | 296 |
Financing lease, After 1 year but within 2 years | 319 | 275 |
Financing lease, After 2 years but within 3 years | 320 | 277 |
Financing lease, After 3 years but within 4 years | 253 | 274 |
Financing lease, After 4 years but within 5 years | 252 | 236 |
Financing lease, After 5 years | 2,821 | 3,007 |
Total undiscounted cash flows | 4,281 | 4,365 |
Discount on cash flows | (1,120) | (1,202) |
Total lease liabilities | $ 3,161 | $ 3,163 |
Lease Commitments - Additional
Lease Commitments - Additional information (Details) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Dec. 31, 2019 | |
Short Term Equipment Under Lease [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Description Of Accounting Treatment For Short Term Operating Lease | As of September 30, 2020, the Company had no short-term leases. As of December 31, 2019, the Company had one short-term equipment lease which it elected to not record on the Consolidated Balance Sheets. | As of September 30, 2020, the Company had no short-term leases. As of December 31, 2019, the Company had one short-term equipment lease which it elected to not record on the Consolidated Balance Sheets. |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning balance | $ (14,071) | $ (12,550) | $ (16,171) | $ (14,225) |
Other comprehensive income (loss) before reclassifications | (370) | 473 | 765 | 1,521 |
Amounts reclassified from accumulated other comprehensive loss | 483 | 256 | 1,448 | 883 |
Net current period other comprehensive income (loss) | 113 | 729 | 2,213 | 2,404 |
Ending balance | (13,958) | (11,821) | (13,958) | (11,821) |
Net Unrealized Gains and (Losses) on Investment Securities AFS | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning balance | 3,398 | 1,398 | 1,715 | (1,409) |
Other comprehensive income (loss) before reclassifications | 113 | 480 | 1,796 | 3,311 |
Amounts reclassified from accumulated other comprehensive loss | (69) | (93) | ||
Net current period other comprehensive income (loss) | 113 | 411 | 1,796 | 3,218 |
Ending balance | 3,511 | 1,809 | 3,511 | 1,809 |
Defined Benefit Pension Items | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning balance | (17,469) | (13,948) | (17,886) | (12,816) |
Other comprehensive income (loss) before reclassifications | (483) | (7) | (1,031) | (1,790) |
Amounts reclassified from accumulated other comprehensive loss | 483 | 325 | 1,448 | 976 |
Net current period other comprehensive income (loss) | 318 | 417 | (814) | |
Ending balance | $ (17,469) | $ (13,630) | $ (17,469) | $ (13,630) |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Loss - Reclassification of component (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Realized (gains) losses on sale of securities | ||||
Net realized (gains) losses on investment securities | $ (88) | $ (118) | ||
Provision for income taxes | 19 | 25 | ||
Net of tax | (69) | (93) | ||
Amortization of estimated defined benefit pension plan loss | ||||
Other expense | $ 611 | 412 | $ 1,833 | 1,236 |
Provision for income taxes | (128) | (87) | (385) | (260) |
Net of tax | 483 | 325 | 1,448 | 976 |
Total reclassifications for the period | $ 483 | $ 256 | $ 1,448 | $ 883 |
Regulatory Capital (Details)
Regulatory Capital (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Summarized regulatory capital ratio of company | ||
Total Capital (To RWA), Actual Amount | $ 122,960 | $ 119,477 |
Tier 1 Common Equity (To RWA), Actual Amount | 111,803 | 109,173 |
Tier 1 Capital (To RWA), Actual Amount | 111,803 | 109,173 |
Tier 1 Capital (To Average Assets), Actual Amount | $ 111,803 | $ 109,173 |
Total Capital (To RWA), Actual Ratio | 11.80 | 12.23 |
Tier 1 Common Equity (To RWA), Actual Ratio | 10.73 | 11.17 |
Tier 1 Capital (To RWA), Actual Ratio | 10.73 | 11.17 |
Tier 1 Capital (To Average Assets), Actual Ratio | 9.05 | 9.50 |
Total Capital (To RWA), Minimum Required For Capital Adequacy Purpose | 8 | 8 |
Tier 1 Common Equity (To RWA), Minimum Required For Capital Adequacy Purpose | 4.50% | 4.50% |
Tier 1 Capital (To RWA), Minimum Required For Capital Adequacy Purpose | 6 | 6 |
Tier 1 Capital (To Average Assets), Minimum Required For Capital Adequacy Purpose | 4 | 4 |
Total Capital (To RWA), To Be Will Capitalized Under Prompt Corrective Action Regulations | 10 | 10 |
Tier 1 Common Equity (To RWA), To Be Will Capitalized Under Prompt Corrective Action Regulations | 6.50% | 6.50% |
Tier 1 Capital (To RWA), To Be Well Capitalized Under Prompt Corrective Action Regulations | 8 | 8 |
Tier 1 Capital (To Average Assets), To Be Will Capitalized Under Prompt Corrective Action Regulations | 5 | 5 |
Parent Company [Member] | ||
Summarized regulatory capital ratio of company | ||
Total Capital (To RWA), Actual Amount | $ 135,967 | $ 132,544 |
Tier 1 Common Equity (To RWA), Actual Amount | 105,383 | 102,841 |
Tier 1 Capital (To RWA), Actual Amount | 117,282 | 114,729 |
Tier 1 Capital (To Average Assets), Actual Amount | $ 117,282 | $ 114,729 |
Total Capital (To RWA), Actual Ratio | 13.02 | 13.49 |
Tier 1 Common Equity (To RWA), Actual Ratio | 10.09 | 10.47 |
Tier 1 Capital (To RWA), Actual Ratio | 11.23 | 11.68 |
Tier 1 Capital (To Average Assets), Actual Ratio | 9.39 | 9.87 |
Regulatory Capital - Additional
Regulatory Capital - Additional Information (Details) | Sep. 30, 2020 |
Regulatory Capital | |
Tangible Capital to Tangible Assets | 7.34 |
Derivative Hedging Instrument_2
Derivative Hedging Instruments (Details) - Swap [Member] - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Derivative Financial Instruments, Liabilities [Member] | ||
Derivative, Swap Type | Fair Value | Fair Value |
Derivative Liability, Notional Amount | $ (36,726) | $ (23,866) |
Derivative Instruments Weighted Average Interest Rate Received Paid | (3.06%) | (4.69%) |
Derivative Instruments, Repricing Frequency | Monthly | Monthly |
Increase (Decrease) in Interest Expense | $ 345 | $ (11) |
Derivative Financial Instruments, Assets [Member] | ||
Derivative, Swap Type | Fair Value | Fair Value |
Derivative Asset, Notional Amount | $ 36,726 | $ 23,866 |
Derivative Instruments Weighted Average Interest Rate Received Paid | 3.06% | 4.69% |
Derivative Instruments, Repricing Frequency | Monthly | Monthly |
Increase (Decrease) in Interest Expense | $ (345) | $ 11 |
Derivative Hedging Instrument_3
Derivative Hedging Instruments - Additional Information (Details) $ in Millions | Sep. 30, 2020USD ($) |
Derivative Hedging Instruments | |
Derivative Notional Amount Outstanding | $ 500 |
Segment Results (Details)
Segment Results (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Contribution of segments to the consolidated results of operations | ||||
Total revenue | $ 13,095 | $ 12,859 | $ 38,918 | $ 37,839 |
Net income (loss) | 1,078 | 1,689 | 3,906 | 5,359 |
Community banking | ||||
Contribution of segments to the consolidated results of operations | ||||
Total revenue | 12,263 | 11,739 | 36,096 | 34,367 |
Net income (loss) | 2,509 | 2,791 | 7,788 | 8,621 |
Wealth management | ||||
Contribution of segments to the consolidated results of operations | ||||
Total revenue | 2,620 | 2,458 | 7,672 | 7,315 |
Net income (loss) | 547 | 477 | 1,510 | 1,365 |
Investment/Parent | ||||
Contribution of segments to the consolidated results of operations | ||||
Total revenue | (1,788) | (1,338) | (4,850) | (3,843) |
Net income (loss) | $ (1,978) | $ (1,579) | $ (5,392) | $ (4,627) |
Commitments and Contingent Li_2
Commitments and Contingent Liabilities (Details) - USD ($) $ in Millions | Sep. 30, 2020 | Dec. 31, 2019 |
Commitments to extend credit | ||
Loss Contingencies [Line Items] | ||
Amount of commitment | $ 235.7 | $ 195.5 |
Standby letters of Credit | ||
Loss Contingencies [Line Items] | ||
Amount of commitment | $ 13.5 | $ 14.7 |
Pension Benefits - Component of
Pension Benefits - Component of net periodic benefit cost (Details) - Defined Benefit Pension Items - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Components of net periodic benefit cost | ||||
Service cost | $ 419 | $ 368 | $ 1,257 | $ 1,104 |
Interest cost | 320 | 392 | 960 | 1,176 |
Expected return on plan assets | (811) | (756) | (2,433) | (2,268) |
Recognized net actuarial loss | 611 | 412 | 1,833 | 1,236 |
Net periodic pension cost | $ 539 | $ 416 | $ 1,617 | $ 1,248 |
Pension Benefits - Additional i
Pension Benefits - Additional information (Details) | Sep. 30, 2020 |
Pension Benefits | |
Minimum number of annual hours | 1,000 |
Maximum percent of plan assets comprised of AmeriServ Financial, Inc. common stock | 10.00% |
Disclosures about Fair Value _3
Disclosures about Fair Value Measurements and Financial Instruments - Schedule of assets and liability measured and recorded on the Consolidated Balance Sheets (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Equity securities | $ 424 | $ 366 |
Available for sale, at fair value | 141,716 | 141,749 |
Fair value swap asset | 3,665 | 959 |
Fair value swap liability | (3,665) | (959) |
U.S. Agency | ||
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Available for sale, at fair value | 3,276 | 5,116 |
U.S. Agency mortgage-backed securities | ||
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Available for sale, at fair value | 69,042 | 81,633 |
Municipal | ||
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Available for sale, at fair value | 18,651 | 15,170 |
Corporate bonds | ||
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Available for sale, at fair value | 50,747 | 39,830 |
Level 1 | ||
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Equity securities | 424 | 366 |
Level 2 | ||
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Fair value swap asset | 3,665 | 959 |
Fair value swap liability | (3,665) | (959) |
Level 2 | U.S. Agency | ||
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Available for sale, at fair value | 3,276 | 5,116 |
Level 2 | U.S. Agency mortgage-backed securities | ||
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Available for sale, at fair value | 69,042 | 81,633 |
Level 2 | Municipal | ||
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Available for sale, at fair value | 18,651 | 15,170 |
Level 2 | Corporate bonds | ||
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Available for sale, at fair value | $ 50,747 | $ 39,830 |
Disclosures about Fair Value _4
Disclosures about Fair Value Measurements and Financial Instruments - Schedule of assets measured and recorded at fair value on a non-recurring basis (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Dec. 31, 2019 | |
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Impaired loan with carrying value | $ 266,000 | $ 263,000 |
Specific valuation allowance | 8,000 | 8,000 |
Impaired loans | 258,000 | 255,000 |
Fair Value Measurements, Nonrecurring Basis | ||
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Impaired loans | 258,000 | 255,000 |
Other real estate owned | 40,000 | 37,000 |
Fair Value Measurements, Nonrecurring Basis | Impaired loans | ||
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Impaired loans | 258,000 | $ 255,000 |
Appraisal adjustments | 0.00% | |
Fair Value Measurements, Nonrecurring Basis | Other real estate owned | ||
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Other real estate owned | $ 40,000 | $ 37,000 |
Valuation Techniques | Appraisal of collateral | |
Appraisal adjustments | 57.00% | |
Fair Value Measurements, Nonrecurring Basis | Minimum | Impaired loans | ||
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Appraisal adjustments | 0.00% | |
Fair Value Measurements, Nonrecurring Basis | Minimum | Other real estate owned | ||
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Appraisal adjustments | 0.00% | |
Liquidation expenses | 22.00% | 21.00% |
Fair Value Measurements, Nonrecurring Basis | Maximum | Impaired loans | ||
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Appraisal adjustments | 100.00% | 100.00% |
Fair Value Measurements, Nonrecurring Basis | Maximum | Other real estate owned | ||
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Appraisal adjustments | 57.00% | |
Liquidation expenses | 38.00% | 134.00% |
Fair Value Measurements, Nonrecurring Basis | Wgtd Ave | Impaired loans | ||
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Appraisal adjustments | 3.00% | 3.00% |
Fair Value Measurements, Nonrecurring Basis | Wgtd Ave | Other real estate owned | ||
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Appraisal adjustments | 57.00% | 38.00% |
Liquidation expenses | 30.00% | 30.00% |
Fair Value Measurements, Nonrecurring Basis | Level 3 | Impaired loans | ||
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Impaired loans | $ 258,000 | $ 255,000 |
Other real estate owned | $ 40,000 | |
Valuation Techniques | Appraisal of collateral | Appraisal of collateral |
Fair Value Measurements, Nonrecurring Basis | Level 3 | Other real estate owned | ||
DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS | ||
Other real estate owned | $ 37,000 | |
Valuation Techniques | Appraisal of collateral |
Disclosures about Fair Value _5
Disclosures about Fair Value Measurements and Financial Instruments - Schedule of estimated fair value and recorded carrying value (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Dec. 31, 2019 | |
FINANCIAL ASSETS: Carrying Value | ||
Investment securities - HTM, Carrying Value | $ 42,636 | $ 39,936 |
Loans held for sale | 7,587 | 4,868 |
Loans, net of allowance for loan loss and unearned income, Carrying Value | 931,496 | 873,427 |
Investment securities - HTM, Fair Value | 45,308 | 41,082 |
Loans held for sale, Fair Value | 7,766 | 4,970 |
Loans, net of allowance for loan loss and unearned income, Fair Value | 941,988 | 873,908 |
FINANCIAL LIABILITIES: Carrying Value | ||
Deposits with no stated maturities, Carrying Value | 728,507 | 651,469 |
Deposits with stated maturities, Carrying Value | 313,728 | 309,044 |
All other borrowings, Carrying Value | 94,830 | 74,134 |
Deposits with no stated maturities, Fair Value | 745,879 | 631,023 |
Deposits with stated maturities, Fair Value | 317,679 | 310,734 |
All other borrowings, Fair Value | $ 100,945 | 76,323 |
Assets and liabilities considered financial instruments, percentage | 90.00% | |
Level 1 | ||
FINANCIAL ASSETS: Carrying Value | ||
Loans held for sale, Fair Value | $ 7,766 | 4,970 |
Level 2 | ||
FINANCIAL ASSETS: Carrying Value | ||
Investment securities - HTM, Fair Value | 42,311 | 38,129 |
Level 3 | ||
FINANCIAL ASSETS: Carrying Value | ||
Investment securities - HTM, Fair Value | 2,997 | 2,953 |
Loans, net of allowance for loan loss and unearned income, Fair Value | 941,988 | 873,908 |
FINANCIAL LIABILITIES: Carrying Value | ||
Deposits with no stated maturities, Fair Value | 745,879 | 631,023 |
Deposits with stated maturities, Fair Value | 317,679 | 310,734 |
All other borrowings, Fair Value | $ 100,945 | $ 76,323 |