Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2020 | May 01, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2020 | |
Document Transition Report | false | |
Entity File Number | 0-17077 | |
Entity Registrant Name | PENNS WOODS BANCORP INC | |
Entity Incorporation, State or Country Code | PA | |
Entity Address, Address Line One | 300 Market Street, P.O. Box 967 | |
Entity Tax Identification Number | 23-2226454 | |
Entity Address, City or Town | Williamsport | |
Entity Address, State or Province | PA | |
Postal Zip Code | 17703-0967 | |
City Area Code | 570 | |
Local Phone Number | 322-1111 | |
Title of 12(b) Security | Common stock, $5.55 par value | |
Trading Symbol | PWOD | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Other Identification Type | Yes | |
Entity Filer Category | Accelerated Filer | |
Smaller Reporting Company | true | |
Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 7,041,580 | |
Entity Central Index Key | 0000716605 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 |
CONSOLIDATED BALANCE SHEET (UNA
CONSOLIDATED BALANCE SHEET (UNAUDITED) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
ASSETS: | ||
Noninterest-bearing balances | $ 29,572 | $ 24,725 |
Interest-bearing balances in other financial institutions | 48,189 | 23,864 |
Total cash and cash equivalents | 77,761 | 48,589 |
Investment debt securities, available for sale, at fair value | 155,522 | 148,619 |
Investment equity securities, at fair value | 1,281 | 1,261 |
Investment securities, trading | 37 | 51 |
Restricted investment in bank stock, at fair value | 14,611 | 13,528 |
Loans held for sale | 4,294 | 4,232 |
Loans | 1,349,400 | 1,355,544 |
Allowance for loan losses | (12,500) | (11,894) |
Loans, net | 1,336,900 | 1,343,650 |
Premises and equipment, net | 33,170 | 32,929 |
Accrued interest receivable | 5,307 | 5,246 |
Bank-owned life insurance | 29,228 | 29,253 |
Goodwill | 17,104 | 17,104 |
Intangibles | 836 | 898 |
Operating lease right-of-use asset | 3,278 | 4,154 |
Deferred tax asset | 3,281 | 3,338 |
Other assets | 5,898 | 12,471 |
TOTAL ASSETS | 1,688,508 | 1,665,323 |
LIABILITIES: | ||
Interest-bearing deposits | 993,975 | 989,259 |
Noninterest-bearing deposits | 332,759 | 334,746 |
Total deposits | 1,326,734 | 1,324,005 |
Short-term borrowings | 17,741 | 4,920 |
Long-term borrowings | 171,903 | 161,920 |
Accrued interest payable | 1,635 | 1,671 |
Operating lease liability | 3,299 | 4,170 |
Other liabilities | 10,608 | 13,655 |
TOTAL LIABILITIES | 1,531,920 | 1,510,341 |
SHAREHOLDERS’ EQUITY: | ||
Preferred stock, no par value, 3,000,000 shares authorized; no shares issued | 0 | 0 |
Common stock, par value $5.55, 22,500,000 shares authorized; 7,521,491 and 7,520,740 shares issued; 7,041,266 and 7,040,515 outstanding | 41,786 | 41,782 |
Additional paid-in capital | 51,701 | 51,487 |
Retained earnings | 77,403 | 76,583 |
Accumulated other comprehensive loss: | ||
Net unrealized gain on available for sale securities | 2,986 | 2,455 |
Defined benefit plan | (5,199) | (5,232) |
Treasury stock at cost, 480,225 | (12,115) | (12,115) |
TOTAL PENNS WOODS BANCORP, INC. SHAREHOLDERS' EQUITY | 156,562 | 154,960 |
Non-controlling interest | 26 | 22 |
TOTAL SHAREHOLDERS' EQUITY | 156,588 | 154,982 |
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ 1,688,508 | $ 1,665,323 |
CONSOLIDATED BALANCE SHEET (U_2
CONSOLIDATED BALANCE SHEET (UNAUDITED) (Parenthetical) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Preferred stock, shares authorized (in shares) | 3,000,000 | 3,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 5.55 | $ 5.55 |
Common stock, shares authorized (in shares) | 22,500,000 | 22,500,000 |
Common stock, shares issued (in shares) | 7,521,491 | 7,520,740 |
Common stock, shares outstanding (in shares) | 7,041,266 | 7,040,515 |
Treasury stock (in shares) | 480,225 | 480,225 |
CONSOLIDATED STATEMENT OF INCOM
CONSOLIDATED STATEMENT OF INCOME (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
INTEREST AND DIVIDEND INCOME: | ||
Loans, including fees | $ 14,657 | $ 14,869 |
Investment securities: | ||
Taxable | 1,010 | 934 |
Tax-exempt | 145 | 174 |
Dividend and other interest income | 349 | 457 |
TOTAL INTEREST AND DIVIDEND INCOME | 16,161 | 16,434 |
INTEREST EXPENSE: | ||
Deposits | 3,035 | 2,300 |
Short-term borrowings | 22 | 605 |
Long-term borrowings | 943 | 851 |
TOTAL INTEREST EXPENSE | 4,000 | 3,756 |
NET INTEREST INCOME | 12,161 | 12,678 |
PROVISION FOR LOAN LOSSES | 750 | 360 |
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES | 11,411 | 12,318 |
NON-INTEREST INCOME: | ||
Net debt securities gains, available for sale | 21 | 13 |
Net equity securities gains | 20 | 43 |
Net securities (losses) gains, trading | (14) | 10 |
Bank-owned life insurance | 192 | 168 |
Gain on sale of loans | 444 | 316 |
Other | 455 | 375 |
TOTAL NON-INTEREST INCOME | 2,437 | 2,254 |
NON-INTEREST EXPENSE: | ||
Salaries and employee benefits | 5,667 | 5,501 |
Occupancy | 702 | 779 |
Furniture and equipment | 860 | 752 |
Software amortization | 250 | 207 |
Pennsylvania shares tax | 285 | 293 |
Professional fees | 622 | 522 |
Federal Deposit Insurance Corporation deposit insurance | 194 | 268 |
Marketing | 53 | 102 |
Intangible amortization | 62 | 71 |
Other | 1,415 | 1,319 |
TOTAL NON-INTEREST EXPENSE | 10,110 | 9,814 |
INCOME BEFORE INCOME TAX PROVISION | 3,738 | 4,758 |
INCOME TAX PROVISION | 661 | 812 |
CONSOLIDATED NET INCOME | 3,077 | 3,946 |
Less: Net income attributable to noncontrolling interest | 4 | 2 |
NET INCOME ATTRIBUTABLE TO PENNS WOODS BANCORP, INC. | $ 3,073 | $ 3,944 |
Earnings per share - basic (in dollars per share) | $ 0.44 | $ 0.56 |
Earnings per share - diluted (in dollars per share) | $ 0.43 | $ 0.56 |
Weighted average shares outstanding - basic (in shares) | 7,040,740 | 7,037,628 |
Weighted average shares outstanding - diluted (in shares) | 7,102,990 | 7,037,628 |
Dividends declared per share (in dollars per share) | $ 0.32 | $ 0.31 |
Service charges | ||
NON-INTEREST INCOME: | ||
Service charges, insurance commissions, brokerage commissions, and debit card fees | $ 549 | $ 562 |
Insurance Commissions | ||
NON-INTEREST INCOME: | ||
Service charges, insurance commissions, brokerage commissions, and debit card fees | 127 | 134 |
Brokerage Commissions | ||
NON-INTEREST INCOME: | ||
Service charges, insurance commissions, brokerage commissions, and debit card fees | 369 | 323 |
Debit Card | ||
NON-INTEREST INCOME: | ||
Service charges, insurance commissions, brokerage commissions, and debit card fees | $ 274 | $ 310 |
CONSOLIDATED STATEMENT OF COMPR
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | ||
Net Income | $ 3,073 | $ 3,944 |
Other comprehensive income: | ||
Change in unrealized gain on available for sale securities | 694 | 1,984 |
Tax effect | 146 | 417 |
Net realized gain on available for sale securities included in net income | (21) | (13) |
Tax effect | 4 | 3 |
Amortization of unrecognized pension gain | 41 | 47 |
Tax effect | (8) | (10) |
Total other comprehensive gain income | 564 | 1,594 |
Comprehensive income | $ 3,637 | $ 5,538 |
CONSOLIDATED STATEMENT OF CHANG
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY (UNAUDITED) - USD ($) $ in Thousands | Total | COMMON STOCK | ADDITIONAL PAID-IN CAPITAL | RETAINED EARNINGS | ACCUMULATED OTHER COMPREHENSIVE LOSS | TREASURY STOCK | NON-CONTROLLING INTEREST |
Beginning balance (in shares) at Dec. 31, 2018 | 7,517,547 | ||||||
Beginning balance at Dec. 31, 2018 | $ 143,544 | $ 41,763 | $ 50,737 | $ 69,787 | $ (6,636) | $ (12,115) | $ 8 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | 3,946 | 3,944 | 2 | ||||
Other comprehensive income | 1,594 | 1,594 | |||||
Stock-based compensation | 136 | 136 | |||||
Dividends declared | (2,205) | (2,205) | |||||
Common shares issued for employee stock purchase plan | 21 | $ 4 | 17 | ||||
Ending balance (in shares) at Mar. 31, 2019 | 7,518,410 | ||||||
Ending balance at Mar. 31, 2019 | 147,036 | $ 41,767 | 50,890 | 71,526 | (5,042) | (12,115) | 10 |
Beginning balance (in shares) at Dec. 31, 2019 | 7,520,740 | ||||||
Beginning balance at Dec. 31, 2019 | 154,982 | $ 41,782 | 51,487 | 76,583 | (2,777) | (12,115) | 22 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | 3,077 | 3,073 | 4 | ||||
Other comprehensive income | 564 | 564 | |||||
Stock-based compensation | 198 | 198 | |||||
Dividends declared | (2,253) | (2,253) | |||||
Common shares issued for employee stock purchase plan | 20 | $ 4 | 16 | ||||
Ending balance (in shares) at Mar. 31, 2020 | 7,521,491 | ||||||
Ending balance at Mar. 31, 2020 | $ 156,588 | $ 41,786 | $ 51,701 | $ 77,403 | $ (2,213) | $ (12,115) | $ 26 |
CONSOLIDATED STATEMENT OF CHA_2
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY (UNAUDITED) (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Statement of Stockholders' Equity [Abstract] | ||
Dividends declared, per share (in dollars per share) | $ 0.32 | $ 0.31 |
CONSOLIDATED STATEMENT OF CASH
CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
OPERATING ACTIVITIES: | ||
Net Income | $ 3,077 | $ 3,946 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 760 | 691 |
Gain on sale of premise and equipment | (14) | 0 |
Amortization of intangible assets | 62 | 71 |
Provision for loan losses | 750 | 360 |
Stock based compensation | 198 | 136 |
Accretion and amortization of investment security discounts and premiums | 171 | 157 |
Net securities gains, available for sale | (21) | (13) |
Originations of loans held for sale | (14,977) | (8,998) |
Proceeds of loans held for sale | 15,359 | 10,456 |
Gain on sale of loans | (444) | (316) |
Net equity securities gains | (20) | (43) |
Net securities (losses) gains, trading | 14 | (10) |
Proceeds from the sale of trading securities | 0 | 77 |
Purchases of trading securities | 0 | (73) |
Earnings on bank-owned life insurance | (192) | (168) |
(Increase) decrease in deferred tax asset | (84) | 499 |
Proceeds on sales of investment securities receivable | 6,627 | 0 |
Other, net | (2,658) | (474) |
Net cash provided by operating activities | 8,608 | 6,298 |
INVESTING ACTIVITIES: | ||
Proceeds from sales of available for sale securities | 2,774 | 6,986 |
Proceeds from calls and maturities of available for sale securities | 2,598 | 817 |
Purchases of available for sale securities | (11,753) | (12,962) |
Net decrease (increase) in loans | 5,861 | (169) |
Acquisition of premises and equipment | (1,547) | (615) |
Proceeds from the sale of premises and equipment | 336 | 0 |
Proceeds from the sale of foreclosed assets | 226 | 117 |
Purchase of bank-owned life insurance | (26) | (26) |
Proceeds from bank-owned life insurance death benefit | (248) | 0 |
Investment in limited partnership | (370) | 0 |
Proceeds from redemption of regulatory stock | 1,139 | 6,898 |
Purchases of regulatory stock | (2,222) | (3,761) |
Net cash used for investing activities | (2,736) | (2,715) |
FINANCING ACTIVITIES: | ||
Net increase in interest-bearing deposits | 4,716 | 88,315 |
Net (decrease) increase in noninterest-bearing deposits | (1,987) | 843 |
Proceeds from long-term borrowings | 35,000 | 15,000 |
Repayment of long-term borrowings | (25,000) | (15,317) |
Net increase (decrease) in short-term borrowings | 12,821 | (83,366) |
Finance lease principal payments | (17) | (20) |
Dividends paid | (2,253) | (2,205) |
Issuance of common stock | 20 | 21 |
Net cash provided by financing activities | 23,300 | 3,271 |
NET INCREASE IN CASH AND CASH EQUIVALENTS | 29,172 | 6,854 |
CASH AND CASH EQUIVALENTS, BEGINNING | 48,589 | 66,742 |
CASH AND CASH EQUIVALENTS, ENDING | 77,761 | 73,596 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: | ||
Interest paid | 4,036 | 3,628 |
Income taxes paid | 0 | 0 |
Non-cash investing and financing activities: | ||
Right-of-use lease assets obtained in exchange for lessee finance lease liabilities | 0 | 6,026 |
Right-of-use lease assets obtained in exchange for lessee operating lease liabilities | 0 | 4,298 |
Transfer of loans to foreclosed real estate | $ 139 | $ 51 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The consolidated financial statements include the accounts of Penns Woods Bancorp, Inc. (the “Company”) and its wholly-owned subsidiaries: Woods Investment Company, Inc., Woods Real Estate Development Company, Inc., Luzerne Bank, and Jersey Shore State Bank (Jersey Shore State Bank and Luzerne Bank are referred to together as the “Banks”) and Jersey Shore State Bank’s wholly-owned subsidiary, The M Group, Inc. D/B/A The Comprehensive Financial Group (“The M Group”). The Company also owns a controlling interest in United Insurance Solutions, LLC. All significant inter-company balances and transactions have been eliminated in the consolidation. The interim financial statements are unaudited, but in the opinion of management reflect all adjustments necessary for the fair presentation of results for such periods. The results of operations for any interim period are not necessarily indicative of results for the full year. These financial statements should be read in conjunction with the financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 . In reference to the attached financial statements, all adjustments are of a normal recurring nature pursuant to Rule 10-01(b) (8) of Regulation S-X. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Gain (Loss) | 3 Months Ended |
Mar. 31, 2020 | |
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |
Accumulated Other Comprehensive Gain (Loss) | Accumulated Other Comprehensive Gain (loss) The changes in accumulated other comprehensive gain (loss) by component shown net of tax and parenthesis indicating debits, as of March 31, 2020 and 2019 were as follows: Three Months Ended March 31, 2020 Three Months Ended March 31, 2019 (In Thousands) Net Unrealized Gain (Loss) on Available for Sale Securities Defined Benefit Plan Total Net Unrealized Gain (Loss) on Available for Sale Securities Defined Benefit Plan Total Beginning balance $ 2,455 $ (5,232 ) $ (2,777 ) $ (1,360 ) $ (5,276 ) $ (6,636 ) Other comprehensive gain before reclassifications 548 — 548 1,567 — 1,567 Amounts reclassified from accumulated other comprehensive (loss) gain (17 ) 33 16 (10 ) 37 27 Net current-period other comprehensive income 531 33 564 1,557 37 1,594 Ending balance $ 2,986 $ (5,199 ) $ (2,213 ) $ 197 $ (5,239 ) $ (5,042 ) The reclassifications out of accumulated other comprehensive loss shown, net of tax and parenthesis indicating debits to net income, as of March 31, 2020 and 2019 were as follows: Details about Accumulated Other Comprehensive Loss Components Amount Reclassified from Accumulated Other Comprehensive Loss Affected Line Item in the Consolidated Statement of Income Three months ended March 31, 2020 Three months ended March 31, 2019 Net unrealized gain on available for sale securities $ 21 $ 13 Net debt securities gains, available for sale Income tax effect (4 ) (3 ) Income tax provision Total reclassifications for the period $ 17 $ 10 Net unrecognized pension costs $ (41 ) $ (47 ) Salaries and employee benefits Income tax effect 8 10 Income tax provision Total reclassifications for the period $ (33 ) $ (37 ) |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2020 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments , 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 effected 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. ASU 2016-13 is effective for annual and interim periods beginning after December 15, 2019, and early adoption is permitted for annual and interim periods beginning after December 15, 2018. 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. On October 16, 2019, the FASB voted to defer the effective date for ASC 326, Financial Instruments - Credit Losses , for smaller reporting companies to fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. 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. In January 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment . To simplify the subsequent measurement of goodwill, the FASB eliminated Step 2 from the goodwill impairment test. In computing the implied fair value of goodwill under Step 2, an entity had to perform procedures to determine the fair value at the impairment testing date of its assets and liabilities (including unrecognized assets and liabilities) following the procedure that would be required in determining the fair value of assets acquired and liabilities assumed in a business combination. Instead, under the amendments in this Update, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting units fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. A public business entity that is a U.S. Securities and Exchange Commission (SEC) filer should adopt the amendments in this Update for its annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. A public business entity that is not an SEC filer should adopt the amendments in this Update for its annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2020. All other entities, including not-for-profit entities, that are adopting the amendments in this Update should do so for their annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2021. On October 16, 2019, the FASB voted to defer the effective date for ASC 350 , Intangibles - Goodwill and Other , for smaller reporting companies to fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. This Update is not expected to have a significant impact on the Company’s financial statements. In August 2018, the FASB issued ASU 2018-14, Compensation - Retirement Benefits (Topic 715-20). This Update amends ASC 715 to add, remove and clarify disclosure requirements related to defined benefit pension and other postretirement plans. The Update eliminates the requirement to disclose the amounts in accumulated other comprehensive income expected to be recognized as part of net periodic benefit cost over the next year. The Update also removes the disclosure requirements for the effects of a one-percentage-point change on the assumed health care costs and the effect of this change in rates on service cost, interest cost and the benefit obligation for postretirement health care benefits. This Update is effective for public business entities for fiscal years ending after December 15, 2020, and must be applied on a retrospective basis. For all other entities, this Update is effective for fiscal years ending after December 15, 2021. This Update is not expected to have a significant impact on the Company’s financial statements. In August 2018, the FASB issued ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40). This Update addresses customers’ accounting for implementation costs incurred in a cloud computing arrangement that is a service contract and also adds certain disclosure requirements related to implementation costs incurred for internal-use software and cloud computing arrangements. The amendment aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). This Update is effective for public business entities for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2020, and interim periods within fiscal years beginning after December 15, 2021. The amendments in this Update can be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. On October 16, 2019, the FASB voted to defer the effective date for ASC 350 , Intangibles - Goodwill and Other , for smaller reporting companies to fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. This Update is not expected to have a significant impact on the Company’s financial statements. In October 2018, the FASB issued ASU 2018-16 , Derivatives and Hedging (Topic 815) . The amendments in this Update permit use of the Overnight Index Swap (OIS) rate based on the Secured Overnight Financing Rate (SOFR) as a U.S. benchmark interest rate for hedge accounting purposes under Topic 815, in addition to the interest rates on direct Treasury obligations of the U.S. government, the London Interbank Offered Rate (LIBOR) swap rate, the OIS rate based on the Fed Funds Effective Rate, and the Securities Industry and Financial Markets Association (SIFMA) Municipal Swap Rate. For entities that have not already adopted Update 2017-12, the amendments in this Update are required to be adopted concurrently with the amendments in Update 2017-12. For public business entities that already have adopted the amendments in Update 2017-12, the amendments are effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. For all other entities that already have adopted the amendments in Update 2017-12, the amendments are effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. Early adoption is permitted in any interim period upon issuance of this Update if an entity already has adopted Update 2017-12. This Update is not expected to have a significant impact on the Company’s financial statements. In April 2019, the FASB issued ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments - Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments, which affects a variety of topics in the Codification and applies to all reporting entities within the scope of the affected accounting guidance. Topic 326, Financial Instruments - Credit Losses amendments are effective for SEC registrants for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. For all other public business entities, the effective date is for fiscal years beginning after December 15, 2020, and for all other entities, the effective date is for fiscal years beginning after December 15, 2021.On October 16, 2019, the FASB voted to defer the effective date for ASC 326, Financial Instruments - Credit Losses , for smaller reporting companies to fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. The final ASU is expected to be issued in mid-November. Topic 815, Derivatives and Hedging amendments are effective for public business entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2019, and interim periods beginning after December 15, 2020. For entities that have adopted the amendments in Update 2017- 12, the effective date is as of the beginning of the first annual period beginning after the issuance of this Update. Topic 825, Financial Instruments amendments are effective for fiscal years beginning after December 15, 2019, and interim periods within fiscal years. This Update is not expected to have a significant impact on the Company’s financial statements. In May 2019, the FASB issued ASU 2019-05, Financial Instruments - Credit Losses, Topic 326 , which allows entities to irrevocably elect the fair value option for certain financial assets previously measured at amortized cost upon adoption of the new credit losses standard. To be eligible for the transition election, the existing financial asset must otherwise be both within the scope of the new credit losses standard and eligible for the applying the fair value option in ASC 825-10.3. The election must be applied on an instrument-by-instrument basis and is not available for either available-for-sale or held-to-maturity debt securities. For entities that elect the fair value option, the difference between the carrying amount and the fair value of the financial asset would be recognized through a cumulative-effect adjustment to opening retained earnings as of the date an entity adopted ASU 2016-13. Changes in fair value of that financial asset would subsequently be reported in current earnings. For entities that have not yet adopted ASU 2016-13, the effective dates and transition requirements are the same as those in ASU 2016-13. For entities that have adopted ASU 2016-13, ASU 2019-05 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted once ASU 2016-13 has been adopted. On October 16, 2019, the FASB voted to defer the effective date for ASC 326, Financial Instruments - Credit Losses , for smaller reporting companies to fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. This Update is not expected to have a significant impact on the Company’s financial statements. In November 2019, the FASB issued ASU 2019-09, Financial Services - Insurance (Topic 944) , which defers the effective date of the amendments in Update 2018-12, Financial Services - Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts . For public business entities that meet the definition of an SEC filer, excluding entities eligible to be smaller reporting companies, as defined by the SEC, the amendments in Update 2018-12 are effective for fiscal years beginning after December 15, 2021, and interim periods within those fiscal years. Early application of the amendments in Update 2018-12 is permitted. For all other entities, the amendments in Update 2018-12 are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early application of the amendments in Update 2018-12 is permitted. This Update is not expected to have a significant impact on the Company’s financial statements. In November 2019, the FASB issued ASU 2019-10, Financial Instruments - Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842) . The Update defers the effective dates 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. This Update also amends the mandatory effective date for the elimination of Step 2 from the goodwill impairment test under ASU No. 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (Goodwill) , to align with those used for credit losses. Furthermore, the ASU provides a one-year deferral of the effective dates of the ASUs on derivatives and hedging and leases for companies that are not public business entities. The Company qualifies as a smaller reporting company and does not expect to early adopt these ASUs. In November 2019, the FASB issued ASU 2019-11, Codification Improvements to Topic 326, Financial Instruments - Credit Losses , to clarify its new credit impairment guidance in ASC 326, based on implementation issues raised by stakeholders. This Update clarified, among other things, that expected recoveries are to be included in the allowance for credit losses for these financial assets; an accounting policy election can be made to adjust the effective interest rate for existing troubled debt restructurings based on the prepayment assumptions instead of the prepayment assumptions applicable immediately prior to the restructuring event; and extends the practical expedient to exclude accrued interest receivable from all additional relevant disclosures involving amortized cost basis. The effective dates in this Update are the same as those applicable for ASU 2019-10. This Update is not expected to have a significant impact on the Company’s financial statements. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740) , to simplify the accounting for income taxes, change the accounting for certain tax transactions, and make minor improvements to the codification. This Update provides a policy election to not allocate consolidated income taxes when a member of a consolidated tax return is not subject to income tax and provides guidance to evaluate whether a step-up in tax basis of goodwill relates to a business combination in which book goodwill was recognized or a separate transaction. The Update also changes current guidance for making an intraperiod allocation, if there is a loss in continuing operations and gains outside of continuing operations; determining when a deferred tax liability is recognized after an investor in a foreign entity transitions to or from the equity method of accounting; accounting for tax law changes and year-to-date losses in interim periods; and determining how to apply the income tax guidance to franchise taxes that are partially based on income. For public business entities, the amendments in this Update are effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2020. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2021, and interim periods within fiscal years beginning after December 15, 2022. This Update is not expected to have a significant impact on the Company’s financial statements. In January 2020, the FASB issued ASU 2020-1, Investments - Equity Securities (Topic 321), Investments - Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) , to clarify that an entity should consider observable transactions that require it to either apply or discontinue the equity method of accounting for the purposes of applying the measurement alternative in accordance with Topic 321 immediately before applying or upon discontinuing the equity method. The amendments also clarify that, for the purpose of applying paragraph 815-10-15-141(a) an entity should not consider whether, upon the settlement of the forward contract or exercise of the purchased option, individually or with existing investments, the underlying securities would be accounted for under the equity method in Topic 323 or the fair value option, in accordance with the financial instruments guidance in Topic 825. An entity also would evaluate the remaining characteristics in paragraph 815-10-15-141 to determine the accounting for those forward contracts and purchased options. For public business entities, the amendments in this Update are effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2021, and interim periods within those fiscal years. This Update is not expected to have a significant impact on the Company’s financial statements. In January 2020, the FASB issued ASU 2020-2, Financial Instruments - Credit Losses (Topic 326) and Leases (Topic 842): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 119 and Update to SEC Section on Effective Date Related to Accounting Standards Update No. 2016-02, Leases (Topic 842), to add and amend SEC paragraphs in the Accounting Standards Codification to reflect the issuance of SEC Staff Accounting Bulletin No. 119, related to the new credit losses standard, and comments by the SEC staff related to the revised effective date of the new leases standard. This ASU is effective upon issuance. This did not have a significant impact on the Company’s financial statements. In March 2020, the FASB issued ASU 2020-3 , Codification Improvements to Financial Instruments. This ASU was issued to improve and clarify various financial instruments topics, including the current expected credit losses (CECL) standard issued in 2016. The ASU includes seven issues that describe the areas of improvement and the related amendments to GAAP; they are intended to make the standards easier to understand and apply and to eliminate inconsistencies, and they are narrow in scope and are not expected to significantly change practice for most entities. Among its provisions, the ASU clarifies that all entities, other than public business entities that elected the fair value option, are required to provide certain fair value disclosures under ASC 825, Financial Instruments , in both interim and annual financial statements. It also clarifies that the contractual term of a net investment in a lease under Topic 842 should be the contractual term used to measure expected credit losses under Topic 326. Amendments related to ASU 2019-04 are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is not permitted before an entity’s adoption of ASU 2016-01. Amendments related to ASU 2016-13 for entities that have not yet adopted that guidance are effective upon adoption of the amendments in ASU 2016-13. Early adoption is not permitted before an entity’s adoption of ASU 2016-13. Amendments related to ASU 2016-13 for entities that have adopted that guidance are effective for fiscal years beginning after December 15, 2019, including interim periods within those years. Other amendments are effective upon issuance of this ASU. This Update is not expected to have a significant impact on the Company’s financial statements. 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, to provide temporary optional expedients and exceptions to the U.S. GAAP guidance on contract modifications and hedge accounting to ease the financial reporting burdens of the expected market transition from LIBOR and other interbank offered rates 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. Also, entities can elect various optional expedients that would allow them to continue applying hedge accounting for hedging relationships affected by reference rate reform, if certain criteria are met, and can make a one-time election to sell and/or reclassify held-to-maturity debt securities that reference an interest rate affected by reference rate reform. The amendments in this ASU are effective for all entities upon issuance through December 31, 2022. The Company is currently evaluating the impact the adoption of the standard will have on the Company’s financial position or results of operations. |
Per Share Data
Per Share Data | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Per Share Data | Per Share Data There are no convertible securities which would affect the denominator in calculating basic and dilutive earnings per share. There were a total of 864,300 stock options, with an average exercise price of $28.20 , outstanding on March 31, 2020 . A portion of these options were included, on a weighted average basis, in the computation of diluted earnings per share for the period due to the average market price of common shares of $29.57 exceeding the exercise price of the options issued for all years except for 2017. There were a total of 635,550 stock options outstanding for the same period end in 2019 that had an average exercise price of $29.29 and were excluded, on a weighted average basis, in the computation of diluted earnings per share because the quarterly average closing market price of common shares was $26.91 for the period. Three Months Ended March 31, 2020 2019 Weighted average common shares issued 7,520,965 7,517,853 Weighted average treasury stock shares (480,225 ) (480,225 ) Weighted average common shares outstanding - basic 7,040,740 7,037,628 Dilutive effect of outstanding stock options 62,250 — Weighted average common shares outstanding - basic and diluted 7,102,990 7,037,628 |
Investment Securities
Investment Securities | 3 Months Ended |
Mar. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Investment Securities | Investment Securities The amortized cost, gross unrealized gains and losses, and fair values of our investment securities portfolio at March 31, 2020 and December 31, 2019 are as follows: March 31, 2020 Gross Gross Amortized Unrealized Unrealized Fair (In Thousands) Cost Gains Losses Value Available for sale (AFS): Mortgage-backed securities $ 4,874 $ 125 $ — $ 4,999 State and political securities 87,545 4,574 (79 ) 92,040 Other debt securities 59,323 543 (1,383 ) 58,483 Total debt securities $ 151,742 $ 5,242 $ (1,462 ) $ 155,522 Investment equity securities: Other equity securities $ 1,300 $ 7 $ (26 ) $ 1,281 Trading: Other equity securities $ 50 $ — $ (13 ) $ 37 December 31, 2019 Gross Gross Amortized Unrealized Unrealized Fair (In Thousands) Cost Gains Losses Value Available for sale (AFS): Mortgage-backed securities $ 4,956 $ 56 $ (46 ) $ 4,966 State and political securities 79,064 3,299 (77 ) 82,286 Other debt securities 61,492 401 (526 ) 61,367 Total debt securities $ 145,512 $ 3,756 $ (649 ) $ 148,619 Investment equity securities: Other equity securities $ 1,300 $ — $ (39 ) $ 1,261 Trading: Other equity securities $ 50 $ 3 $ (2 ) $ 51 The following tables show the Company’s gross unrealized losses and fair value, aggregated by investment category and length of time, that the individual debt securities have been in a continuous unrealized loss position, at March 31, 2020 and December 31, 2019 . March 31, 2020 Less than Twelve Months Twelve Months or Greater Total Gross Gross Gross Fair Unrealized Fair Unrealized Fair Unrealized (In Thousands) Value Losses Value Losses Value Losses Available for sale (AFS): Mortgage-backed securities $ — $ — $ — $ — $ — $ — State and political securities 5,887 (61 ) 242 (18 ) 6,129 (79 ) Other debt securities 21,691 (1,068 ) 11,185 (315 ) 32,876 (1,383 ) Total debt securities $ 27,578 $ (1,129 ) $ 11,427 $ (333 ) $ 39,005 $ (1,462 ) December 31, 2019 Less than Twelve Months Twelve Months or Greater Total Gross Gross Gross Fair Unrealized Fair Unrealized Fair Unrealized (In Thousands) Value Losses Value Losses Value Losses Available for sale (AFS): Mortgage-backed securities $ — $ — $ 2,115 $ (46 ) $ 2,115 $ (46 ) State and political securities 7,958 (40 ) 224 (37 ) 8,182 (77 ) Other debt securities 13,373 (216 ) 14,258 (310 ) 27,631 (526 ) Total debt securities $ 21,331 $ (256 ) $ 16,597 $ (393 ) $ 37,928 $ (649 ) At March 31, 2020 , there were a total of 24 securities in a continuous unrealized loss position for less than twelve months and 9 individual securities that were in a continuous unrealized loss position for twelve months or greater. The Company reviews its position quarterly and has determined that, at March 31, 2020 , the declines outlined in the above table represent temporary declines and the Company does not intend to sell and does not believe it will be required to sell these securities before recovery of their cost basis, which may be at maturity. The Company has concluded that the unrealized losses disclosed above are not other than temporary but are the result of interest rate changes, sector credit ratings changes, or company-specific ratings changes that are not expected to result in the non-collection of principal and interest during the period. The amortized cost and fair value of debt securities at March 31, 2020 , by contractual maturity, are shown below. Expected maturities may differ from contractual maturities since borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. (In Thousands) Amortized Cost Fair Value Due in one year or less $ 5,642 $ 5,657 Due after one year to five years 55,063 55,073 Due after five years to ten years 67,078 70,403 Due after ten years 23,959 24,389 Total $ 151,742 $ 155,522 Total gross proceeds from sales of debt securities available for sale for the three months ended March 31, 2020 was $2,774,000 , a decrease from the 2019 total $ 6,986,000 . The following table represents gross realized gains and losses from the sales of debt securities available for sale: Three Months Ended March 31, (In Thousands) 2020 2019 Available for sale (AFS): Gross realized gains: State and political securities $ 1 $ 15 Other debt securities 20 4 Total gross realized gains $ 21 $ 19 Gross realized losses: State and political securities $ — $ 2 Other debt securities — 4 Total gross realized losses $ — $ 6 There were no impairment charges included in gross realized losses for the three months ended March 31, 2020 and 2019 , respectively. Investment securities with a carrying value of approximately $87,695,000 and $74,163,000 at March 31, 2020 and December 31, 2019 , respectively, were pledged to secure certain deposits, repurchase agreements, and for other purposes as required by law. At March 31, 2020 and December 31, 2019 , we had $1,281,000 and $1,261,000 , respectively, in equity securities recorded at fair value. The following is a summary of unrealized and realized gains and losses recognized in net income on equity securities during the three months ended March 31, 2020 and 2019 : Three Months Ended March 31, (In Thousands) 2020 2019 Net (losses) gains recognized in equity securities during the period $ 20 $ 43 Less: Net gains realized on the sale of equity securities during the period — — Unrealized (losses) gains recognized in equity securities held at reporting date $ 20 $ 43 Net gains and losses on trading account securities are as follows for the three months ended March 31, 2020 and 2019 : Three Months Ended March 31, (In Thousands) 2020 2019 Net gains on sale transactions $ — $ 5 Net mark-to-market (losses) gains (14 ) 5 Net (loss) gain on trading account securities $ (14 ) $ 10 |
Loans
Loans | 3 Months Ended |
Mar. 31, 2020 | |
Loans and Leases Receivable Disclosure [Abstract] | |
Loans | Loans Management segments the Banks' loan portfolio to a level that enables risk and performance monitoring according to similar risk characteristics. Loans are segmented based on the underlying collateral characteristics. Categories include commercial, financial, and agricultural, real estate, and installment loans. Real estate loans are further segmented into three categories: residential, commercial, and construction, while installment loans are classified as either consumer automobile loans or other installment loans. The following table presents the related aging categories of loans, by segment, as of March 31, 2020 and December 31, 2019 : March 31, 2020 Past Due Past Due 90 30 To 89 Days Or More Non- (In Thousands) Current Days & Still Accruing Accrual Total Commercial, financial, and agricultural $ 155,692 $ 489 $ 31 $ 1,938 $ 158,150 Real estate mortgage: Residential 607,445 6,321 1,383 1,005 616,154 Commercial 351,202 2,795 — 6,740 360,737 Construction 39,003 230 — 64 39,297 Consumer automobile loans 150,891 700 74 50 151,715 Other consumer installment loans 21,451 522 15 — 21,988 1,325,684 $ 11,057 $ 1,503 $ 9,797 1,348,041 Net deferred loan fees and discounts 1,359 1,359 Allowance for loan losses (12,500 ) (12,500 ) Loans, net $ 1,314,543 $ 1,336,900 December 31, 2019 Past Due Past Due 90 30 To 89 Days Or More Non- (In Thousands) Current Days & Still Accruing Accrual Total Commercial, financial, and agricultural $ 153,737 $ 249 $ 30 $ 2,197 $ 156,213 Real estate mortgage: Residential 615,580 4,881 1,529 1,266 623,256 Commercial 355,597 775 164 6,725 363,261 Construction 37,871 131 — 65 38,067 Consumer automobile loans 149,703 709 — 105 150,517 Other consumer installment loans 22,124 579 324 16 23,043 1,334,612 $ 7,324 $ 2,047 $ 10,374 1,354,357 Net deferred loan fees and discounts 1,187 1,187 Allowance for loan losses (11,894 ) (11,894 ) Loans, net $ 1,323,905 $ 1,343,650 The following table presents interest income the Banks would have recorded if interest had been recorded based on the original loan agreement terms and rate of interest for non-accrual loans and interest income recognized on a cash basis for non-accrual loans for the three months ended March 31, 2020 and 2019 : Three Months Ended March 31, 2020 2019 (In Thousands) Interest Income That Would Have Been Recorded Based on Original Term and Rate Interest Income Recorded on a Cash Basis Interest Income That Would Have Been Recorded Based on Original Term and Rate Interest Income Recorded on a Cash Basis Commercial, financial, and agricultural $ 9 $ — $ 24 $ 39 Real estate mortgage: Residential 9 — 33 23 Commercial 42 — 89 40 Construction — — 1 1 Consumer automobile loans 2 — 2 1 Other consumer installment loans — — 1 — $ 62 $ — $ 150 $ 104 Impaired Loans Impaired loans are loans for which it is probable the Banks will not be able to collect all amounts due according to the contractual terms of the loan agreement. The Banks individually evaluate such loans for impairment and do not aggregate loans by major risk classifications. The definition of “impaired loans” is not the same as the definition of “non-accrual loans,” although the two categories overlap. The Banks may choose to place a loan on non-accrual status due to payment delinquency or uncertain collectability, while not classifying the loan as impaired. Factors considered by management in determining impairment include payment status and collateral value. The amount of impairment for these types of loans is determined by the difference between the present value of the expected cash flows related to the loan, using the original interest rate, and its recorded value, or as a practical expedient in the case of collateralized loans, the difference between the fair value of the collateral and the recorded amount of the loan. When foreclosure is probable, impairment is measured based on the fair value of the collateral. Management evaluates individual loans in all of the commercial segments for possible impairment if the loan is greater than $100,000 and if the loan is either on non-accrual status or has a risk rating of substandard or worse. Management may also elect to measure an individual loan for impairment if less than $100,000 on a case-by-case basis. Mortgage loans on one-to-four family properties and all consumer loans are large groups of smaller-balance homogeneous loans and are measured for impairment collectively with the exception of loans identified as troubled debt restructurings. Loans that experience insignificant payment delays, which are defined as 90 days or less, generally are not classified as impaired. Management determines the significance of payment delays on a case-by-case basis taking into consideration all circumstances surrounding the loan and the borrower including the length of the delay, the borrower’s prior payment record, and the amount of shortfall in relation to the principal and interest owed. Interest income for impaired loans is recorded consistent to the Banks' policy. The following table presents the recorded investment, unpaid principal balance, and related allowance of impaired loans by segment as of March 31, 2020 and December 31, 2019 : March 31, 2020 Recorded Unpaid Principal Related (In Thousands) Investment Balance Allowance With no related allowance recorded: Commercial, financial, and agricultural $ 1,921 $ 4,708 $ — Real estate mortgage: Residential 4,656 4,656 — Commercial 5,089 5,089 — Construction 65 65 — Consumer automobile loans — — — Installment loans to individuals — — — 11,731 14,518 — With an allowance recorded: Commercial, financial, and agricultural 104 104 — Real estate mortgage: Residential 1,074 1,074 177 Commercial 3,472 3,522 1,062 Construction — — — Consumer automobile loans 21 21 5 Installment loans to individuals — — — 4,671 4,721 1,244 Total: Commercial, financial, and agricultural 2,025 4,812 — Real estate mortgage: Residential 5,730 5,730 177 Commercial 8,561 8,611 1,062 Construction 65 65 — Consumer automobile loans 21 21 5 Installment loans to individuals — — — $ 16,402 $ 19,239 $ 1,244 December 31, 2019 Recorded Unpaid Principal Related (In Thousands) Investment Balance Allowance With no related allowance recorded: Commercial, financial, and agricultural $ 2,285 $ 5,072 $ — Real estate mortgage: Residential 5,008 5,008 — Commercial 5,035 5,035 — Construction 65 65 — Consumer automobile loans — — — Installment loans to individuals — — — 12,393 15,180 — With an allowance recorded: Commercial, financial, and agricultural — — — Real estate mortgage: Residential 1,168 1,200 211 Commercial 3,540 3,590 1,104 Construction — — — Consumer automobile loans 130 130 62 Installment loans to individuals 16 16 16 4,854 4,936 1,393 Total: Commercial, financial, and agricultural 2,285 5,072 — Real estate mortgage: Residential 6,176 6,208 211 Commercial 8,575 8,625 1,104 Construction 65 65 — Consumer automobile loans 130 130 62 Installment loans to individuals 16 16 16 $ 17,247 $ 20,116 $ 1,393 The following table presents the average recorded investment in impaired loans and related interest income recognized for the three months ended March 31, 2020 and 2019 : Three Months Ended March 31, 2020 2019 (In Thousands) Average Investment in Impaired Loans Interest Income Recognized on an Accrual Basis on Impaired Loans Interest Income Recognized on a Cash Basis on Impaired Loans Average Investment in Impaired Loans Interest Income Recognized on an Accrual Basis on Impaired Loans Interest Income Recognized on a Cash Basis on Impaired Loans Commercial, financial, and agricultural $ 2,155 $ 1 $ — $ 5,302 $ 1 $ 38 Real estate mortgage: Residential 5,953 57 — 4,163 28 17 Commercial 8,568 26 — 11,069 31 36 Construction 65 — — 73 — 1 Consumer automobile 76 — — 52 — 1 Other consumer installment loans 8 — — 18 — — $ 16,825 $ 84 $ — $ 20,677 $ 60 $ 93 Currently, there is $4,000 committed to be advanced in connection with impaired loans. Troubled Debt Restructurings The loan portfolio also includes certain loans that have been modified in a Troubled Debt Restructuring (“TDR”), where economic concessions have been granted to borrowers who have experienced or are expected to experience financial difficulties. These concessions typically result from loss mitigation activities and could include reductions in the interest rate, payment extensions, forgiveness of principal, forbearance, or other actions. Certain TDRs are classified as nonperforming at the time of restructure and may only be returned to performing status after considering the borrower’s sustained repayment performance for a reasonable period, generally six months . There were no loan modifications considered to be TDRs completed during the three months ended March 31, 2020 and 2019. There were three loan modifications considered to be TDRs made during the twelve months previous to March 31, 2020 that defaulted during the three months ended March 31, 2020 . The defaulted loan types and recorded investments at March 31, 2020 are as follows: one commercial real estate loan with a recorded investment of $1,040,000 , and two commercial and agricultural loans with a recorded investment of $1,112,000 . There were no loan modifications considered to be TDR's made during the twelve months previous to March 31, 2019 that defaulted during the three months ended March 31, 2019. Troubled debt restructurings amounted to $12,885,000 and $13,282,000 as of March 31, 2020 and December 31, 2019 , respectively. The amount of foreclosed residential real estate held at March 31, 2020 and December 31, 2019 , totaled $393,000 and $493,000 , respectively. Consumer mortgage loans secured by residential real estate properties for which formal foreclosure proceedings are in process at March 31, 2020 and December 31, 2019 , totaled $421,000 and $32,000 , respectively. The Company began offering short-term loan modifications to provide relief to borrowers during the COVID-19 national emergency. The CARES Act along with a joint agency statement issued by federal and state banking agencies, provides that short-term modifications made in a good faith basis in response to COVID-19 who were current at the time the modification program is implemented do not need to be accounted for as TDRs. Loan modifications and payment deferrals have been at historical high levels as the impact of the pandemic continues. As of March 31, 2020, rate modifications have been granted on 23 loans with an aggregate balance of $2,476,000 . In addition, payment deferrals of up to 90 days have been granted on 36 loans with an aggregate balance of $4,044,000 . These loan modifications met applicable requirements to not be considered troubled debt restructurings. The number of customers seeking loan modifications or payment deferrals may increase as the effects of the pandemic continue. Internal Risk Ratings Management uses a ten point internal risk rating system to monitor the credit quality of the overall loan portfolio. The first six categories are considered not criticized, and are aggregated as “Pass” rated. 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 are evaluated for substandard classification. Loans in the doubtful category exhibit the same weaknesses found in the substandard loans, however, the weaknesses are more pronounced. Such loans are static and collection in full is improbable. However, these loans are not yet rated as loss because certain events may occur which would salvage the debt. Loans classified loss are considered uncollectible and charge-off is imminent. To help ensure that risk ratings are accurate and reflect the present and future capacity of borrowers to repay a loan as agreed, the Banks have a structured loan rating process with several layers of internal and external oversight. Generally, consumer and residential mortgage loans are included in the pass category unless a specific action, such as bankruptcy, repossession, or death occurs to raise awareness of a possible credit event. An external semi-annual loan review of large commercial relationships is performed, as well as a sample of smaller transactions. During 2019, the threshold for the annual loan review was commercial relationships of $1,750,000 or greater for JSSB and $1,500,000 or greater for Luzerne with the 2020 review beginning in the second quarter. Confirmation of the appropriate risk category is included in the review. Detailed reviews, including plans for resolution, are performed on loans classified as substandard, doubtful, or loss on a quarterly basis. The following table presents the credit quality categories identified above as of March 31, 2020 and December 31, 2019 : March 31, 2020 Commercial, Financial, and Agricultural Real Estate Mortgages Consumer automobile Other consumer installment loans (In Thousands) Residential Commercial Construction Totals Pass $ 151,756 $ 611,584 $ 346,727 $ 39,163 $ 151,715 $ 21,985 $ 1,322,930 Special Mention 3,154 2,416 5,018 — — — 10,588 Substandard 3,240 2,154 8,992 134 — 3 14,523 $ 158,150 $ 616,154 $ 360,737 $ 39,297 $ 151,715 $ 21,988 $ 1,348,041 December 31, 2019 Commercial, Financial, and Agricultural Real Estate Mortgages Consumer automobile Other consumer installment loans (In Thousands) Residential Commercial Construction Totals Pass $ 149,349 $ 618,350 $ 348,864 $ 37,931 $ 150,517 $ 23,039 $ 1,328,050 Special Mention 3,174 2,436 5,080 — — — 10,690 Substandard 3,690 2,470 9,317 136 — 4 15,617 $ 156,213 $ 623,256 $ 363,261 $ 38,067 $ 150,517 $ 23,043 $ 1,354,357 Allowance for Loan Losses An allowance for loan losses (“ALL”) is maintained to absorb losses 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 future loss experience, and the amount of non-performing loans. The Banks' methodology for determining the ALL is based on the requirements of ASC Section 310-10-35 for loans individually evaluated for impairment (previously discussed) and ASC Subtopic 450-20 for loans collectively evaluated for impairment, as well as the Interagency Policy Statements on the Allowance for Loan and Lease Losses and other bank regulatory guidance. The total of the two components represents the Banks' ALL. Loans that are collectively evaluated for impairment are analyzed with general allowances being made as appropriate. Allowances are segmented based on collateral characteristics previously disclosed, and consistent with credit quality monitoring. Loans that are collectively evaluated for impairment are grouped into two classes for evaluation. A general allowance is determined for “Pass” rated credits, while a separate pool allowance is provided for “Criticized” rated credits that are not individually evaluated for impairment. For the general allowances, historical loss trends are used in the estimation of losses in the current portfolio. These historical loss amounts are modified by other qualitative factors. A historical charge-off factor is calculated utilizing a twelve quarter moving average. However, management may adjust the moving average time frame by up to four quarters to adjust for variances in the economic cycle. Management has identified a number of additional qualitative factors which it uses to supplement the historical charge-off factor because these factors are likely to cause estimated credit losses associated with the existing loan pools to differ from historical loss experience. The additional factors that are evaluated quarterly and updated using information obtained from internal, regulatory, and governmental sources are: national and local economic trends and conditions; levels of and trends in delinquency rates and non-accrual loans; trends in volumes and terms of loans; effects of changes in lending policies; experience, ability, and depth of lending staff; value of underlying collateral; and concentrations of credit from a loan type, industry and/or geographic standpoint. Loans in the criticized pools, which possess certain qualities or characteristics that may lead to collection and loss issues, are closely monitored by management and subject to additional qualitative factors. Management also monitors industry loss factors by loan segment for applicable adjustments to actual loss experience. Management reviews the loan portfolio on a quarterly basis 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. Activity in the allowance is presented for the three months ended March 31, 2020 and 2019 : t Three Months Ended March 31, 2020 Commercial, Financial, and Agricultural Real Estate Mortgages Consumer automobile Other consumer installment (In Thousands) Residential Commercial Construction Unallocated Totals Beginning Balance $ 1,779 $ 4,306 $ 3,210 $ 118 $ 1,780 $ 278 $ 423 $ 11,894 Charge-offs (14 ) (41 ) — — (75 ) (100 ) — (230 ) Recoveries 21 21 — 2 1 41 — 86 Provision 111 251 204 40 149 48 (53 ) 750 Ending Balance $ 1,897 $ 4,537 $ 3,414 $ 160 $ 1,855 $ 267 $ 370 $ 12,500 Three Months Ended March 31, 2019 Commercial, Financial, and Agricultural Real Estate Mortgages Consumer automobile Other consumer installment (In Thousands) Residential Commercial Construction Unallocated Totals Beginning Balance $ 1,680 $ 5,616 $ 4,047 $ 143 $ 1,328 $ 259 $ 764 $ 13,837 Charge-offs (50 ) (73 ) (139 ) — (100 ) (96 ) — (458 ) Recoveries 6 1 — 5 26 15 — 53 Provision 96 186 (106 ) (18 ) 148 100 (46 ) 360 Ending Balance $ 1,732 $ 5,730 $ 3,802 $ 130 $ 1,402 $ 278 $ 718 $ 13,792 The shift in allocation of the loan provision is primarily due to changes in the credit metrics within the loan portfolio and the economic uncertainty caused by the COVID-19 pandemic . The Company grants commercial, industrial, residential, and installment loans to customers primarily throughout north-east and central Pennsylvania. Although the Company has a diversified loan portfolio, a substantial portion of its debtors’ ability to honor their contracts is dependent on the economic conditions within this region. The Company has a concentration of the following to gross loans at March 31, 2020 and 2019 : March 31, 2020 2019 Owners of residential rental properties 16.04 % 14.82 % Owners of commercial rental properties 12.53 % 12.07 % The following table presents the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment based on impairment method as of March 31, 2020 and December 31, 2019 : March 31, 2020 Commercial, Financial, and Agricultural Real Estate Mortgages Consumer Automobile Other consumer installment Unallocated (In Thousands) Residential Commercial Construction Totals Allowance for Loan Losses: Ending allowance balance attributable to loans: Individually evaluated for impairment $ — $ 177 $ 1,062 $ — $ 5 $ — $ — $ 1,244 Collectively evaluated for impairment 1,897 4,360 2,352 160 1,850 267 370 11,256 Total ending allowance balance $ 1,897 $ 4,537 $ 3,414 $ 160 $ 1,855 $ 267 $ 370 $ 12,500 Loans: Individually evaluated for impairment $ 2,025 $ 5,730 $ 8,561 $ 65 $ 21 $ — $ 16,402 Collectively evaluated for impairment 156,125 610,424 352,176 39,232 151,694 21,988 1,331,639 Total ending loans balance $ 158,150 $ 616,154 $ 360,737 $ 39,297 $ 151,715 $ 21,988 $ 1,348,041 December 31, 2019 Commercial, Financial, and Agricultural Real Estate Mortgages Consumer Automobile Other consumer installment Unallocated (In Thousands) Residential Commercial Construction Totals Allowance for Loan Losses: Ending allowance balance attributable to loans: Individually evaluated for impairment $ — $ 211 $ 1,104 $ — $ 62 $ 16 $ — $ 1,393 Collectively evaluated for impairment 1,779 4,095 2,106 118 1,718 262 423 10,501 Total ending allowance balance $ 1,779 $ 4,306 $ 3,210 $ 118 $ 1,780 $ 278 $ 423 $ 11,894 Loans: Individually evaluated for impairment $ 2,285 $ 6,176 $ 8,575 $ 65 $ 130 $ 16 $ 17,247 Collectively evaluated for impairment 153,928 617,080 354,686 38,002 150,387 23,027 1,337,110 Total ending loans balance $ 156,213 $ 623,256 $ 363,261 $ 38,067 $ 150,517 $ 23,043 $ 1,354,357 |
Net Periodic Benefit Cost-Defin
Net Periodic Benefit Cost-Defined Benefit Plans | 3 Months Ended |
Mar. 31, 2020 | |
Pension and Other Postretirement Benefits Cost (Reversal of Cost) [Abstract] | |
Net Periodic Benefit Cost-Defined Benefit Plans | Net Periodic Benefit Cost-Defined Benefit Plans For a detailed disclosure on the Company’s pension and employee benefits plans, please refer to Note 13 of the Company’s Consolidated Financial Statements included in the Annual Report on Form 10-K for the year ended December 31, 2019 . The following sets forth the components of the net periodic benefit/cost of the domestic non-contributory defined benefit plan for the three months ended March 31, 2020 and 2019 , respectively: Three Months Ended March 31, (In Thousands) 2020 2019 Interest cost $ 160 $ 191 Expected return on plan assets (318 ) (249 ) Amortization of net loss 41 47 Net periodic benefit $ (117 ) $ (11 ) Employer Contributions The Company previously disclosed in its consolidated financial statements, included in the Annual Report on Form 10-K for the year ended December 31, 2019 , that it expected to contribute a minimum of $500,000 to its defined benefit plan in 2020 . As of March 31, 2020 , there were contributions of $1,000,000 made to the plan with additional contributions of at least $250,000 anticipated during the remainder of 2020 . |
Employee Stock Purchase Plan
Employee Stock Purchase Plan | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Employee Stock Purchase Plan | Employee Stock Purchase Plan The Company maintains an Employee Stock Purchase Plan (“Plan”). The Plan is intended to encourage employee participation in the ownership and economic progress of the Company. The Plan allows for up to 1,000,000 shares to be purchased by employees. The purchase price of the shares is 95% of market value with an employee eligible to purchase up to the lesser of 15% of base compensation or $12,000 in market value annually. During the three months ended March 31, 2020 and 2019 , there were 751 and 863 shares issued under the plan, respectively. |
Off-Balance Sheet Risk
Off-Balance Sheet Risk | 3 Months Ended |
Mar. 31, 2020 | |
Off Balance Sheet Risk | |
Off-Balance Sheet Risk | Off-Balance Sheet Risk The Company is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments are primarily comprised of commitments to extend credit, standby letters of credit, and credit exposure from the sale of assets with recourse. These instruments involve, to varying degrees, elements of credit, interest rate, or liquidity risk in excess of the amount recognized in the Consolidated Balance Sheet. The contract amounts of these instruments express the extent of involvement the Company has in particular classes of financial instruments. The Company’s exposure to credit loss from nonperformance by the other party to the financial instruments for commitments to extend credit and standby letters of credit is represented by the contractual amount of these instruments. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments. The Company may require collateral or other security to support financial instruments with off-balance sheet credit risk. Financial instruments whose contract amounts represent credit risk are as follows at March 31, 2020 and December 31, 2019 : (In Thousands) March 31, 2020 December 31, 2019 Commitments to extend credit $ 191,676 $ 187,778 Standby letters of credit 9,976 9,638 Credit exposure from the sale of assets with recourse 7,091 6,826 $ 208,743 $ 204,242 Commitments to extend credit are legally binding agreements to lend to customers. Commitments generally have fixed expiration dates or other termination clauses and may require payment of fees. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future liquidity requirements. The Company evaluates each customer’s credit worthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Company, on an extension of credit is based on management’s credit assessment of the counterparty. Standby letters of credit represent conditional commitments issued by the Company to guarantee the performance of a customer to a third party. These instruments are issued primarily to support bid or performance related contracts. The coverage period for these instruments is typically a one year period with an annual renewal option subject to prior approval by management. Fees earned from the issuance of these letters are recognized upon expiration of the coverage period. For secured letters of credit, the collateral is typically Bank deposit instruments or customer business assets. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The following disclosures show the hierarchal disclosure framework associated with the level of pricing observations utilized in measuring assets and liabilities at fair value. 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 quoted prices in active markets, which are either directly or indirectly observable as of the reported date. The nature of these assets and liabilities include 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. This hierarchy requires the use of observable market data when available. The following table presents the assets reported on the Consolidated Balance Sheet at their fair value on a recurring basis as of March 31, 2020 and December 31, 2019 , by level within the fair value hierarchy. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. March 31, 2020 (In Thousands) Level I Level II Level III Total Assets measured on a recurring basis: Investment securities, available for sale: Mortgage-backed securities $ — $ 4,999 $ — $ 4,999 State and political securities — 92,040 — 92,040 Other debt securities — 58,483 — 58,483 Investment equity securities: Other equity securities 1,281 — — 1,281 Investment securities, trading: Other equity securities 37 — — 37 December 31, 2019 (In Thousands) Level I Level II Level III Total Assets measured on a recurring basis: Investment securities, available for sale: Mortgage-backed securities $ — $ 4,966 $ — $ 4,966 State and political securities — 82,286 — 82,286 Other debt securities — 61,367 — 61,367 Investment equity securities: Other equity securities 1,261 — — 1,261 Investment securities, trading: Other equity securities 51 — — 51 The following table presents the assets reported on the Consolidated Balance Sheet at their fair value on a non-recurring basis as of March 31, 2020 and December 31, 2019 , by level within the fair value hierarchy. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. March 31, 2020 (In Thousands) Level I Level II Level III Total Assets measured on a non-recurring basis: Impaired loans $ — $ — $ 15,158 $ 15,158 Other real estate owned — — 308 308 December 31, 2019 (In Thousands) Level I Level II Level III Total Assets measured on a non-recurring basis: Impaired loans $ — $ — $ 15,854 $ 15,854 Other real estate owned — — 413 413 The following tables present a listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques as of March 31, 2020 and December 31, 2019 : March 31, 2020 Quantitative Information About Level III Fair Value Measurements (In Thousands) Fair Value Valuation Technique(s) Unobservable Inputs Range Weighted Average Impaired loans $ 6,891 Discounted cash flow Temporary reduction in payment amount 17% to (59)% (24)% 8,267 Appraisal of collateral (1) Appraisal adjustments (1) 0 to (80)% (10)% Other real estate owned $ 308 Appraisal of collateral (1) Appraisal adjustments (1) (20)% (20)% (1) Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated liquidation expenses. December 31, 2019 Quantitative Information About Level III Fair Value Measurements (In Thousands) Fair Value Valuation Technique(s) Unobservable Inputs Range Weighted Average Impaired loans $ 6,950 Discounted cash flow Temporary reduction in payment amount 17 to (59)% (24)% 8,904 Appraisal of collateral (1) Appraisal adjustments (1) 0 to (30)% (9)% Other real estate owned $ 413 Appraisal of collateral (1) Appraisal adjustments (1) (20)% (20)% (1) Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated liquidation expenses. The discounted cash flow valuation technique is utilized to determine the fair value of performing impaired loans, while non-performing impaired loans utilize the appraisal of collateral method. The significant unobservable inputs used in the fair value measurement of the Company’s impaired loans using the discounted cash flow valuation technique include temporary changes in payment amounts and the probability of default. Significant increases (decreases) in payment amounts would result in significantly higher (lower) fair value measurements. The probability of default is 0% for impaired loans using the discounted cash flow valuation technique because all defaulted impaired loans are valued using the appraisal of collateral valuation technique. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company is required to disclose fair values for its financial instruments. Fair values are made at a specific point in time, based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time the Company’s entire holdings of a particular financial instrument. Also, it is the Company’s general practice and intention to hold most of its financial instruments to maturity and not to engage in trading or sales activities. Because no market exists for a significant portion of the Company’s financial instruments, fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments, and other factors. These fair values are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions can significantly affect the fair values. Fair values have been determined by the Company using historical data and an estimation methodology suitable for each category of financial instruments. The Company’s fair values, methods, and assumptions are set forth below for the Company’s other financial instruments. As certain assets and liabilities, such as deferred tax assets, premises and equipment, and many other operational elements of the Company, are not considered financial instruments but have value, this fair value of financial instruments would not represent the full market value of the Company. The fair values of the Company’s financial instruments not recorded at fair value on a recurring or nonrecurring basis are as follows at March 31, 2020 and December 31, 2019 : Carrying Fair Fair Value Measurements at March 31, 2020 (In Thousands) Value Value Level I Level II Level III Financial assets: Cash and cash equivalents (1) $ 77,761 $ 77,761 $ 77,761 $ — $ — Restricted investment in bank stock (1) 14,611 14,611 14,611 — — Loans held for sale (1) 4,294 4,294 4,294 — — Loans, net 1,336,900 1,325,148 — — 1,325,148 Bank-owned life insurance (1) 29,228 29,228 29,228 — — Accrued interest receivable (1) 5,307 5,307 5,307 — — Financial liabilities: Interest-bearing deposits $ 993,975 $ 999,579 $ 618,680 $ — $ 380,899 Noninterest-bearing deposits (1) 332,759 332,759 332,759 — — Short-term borrowings (1) 17,741 17,741 17,741 — — Long-term borrowings 171,903 176,801 — — 176,801 Accrued interest payable (1) 1,635 1,635 1,635 — — (1) The financial instrument is carried at cost at March 31, 2020 , which approximate the fair value of the instruments Carrying Fair Fair Value Measurements at December 31, 2019 (In Thousands) Value Value Level I Level II Level III Financial assets: Cash and cash equivalents (1) $ 48,589 $ 48,589 $ 48,589 $ — $ — Restricted investment in bank stock (1) 13,528 13,528 13,528 — — Loans held for sale (1) 4,232 4,232 4,232 — — Loans, net 1,343,650 1,346,395 — — 1,346,395 Bank-owned life insurance (1) 29,253 29,253 29,253 — — Accrued interest receivable (1) 5,246 5,246 5,246 — — Financial liabilities: Interest-bearing deposits $ 989,259 $ 990,747 $ 611,374 $ — $ 379,373 Noninterest-bearing deposits (1) 334,746 334,746 334,746 — — Short-term borrowings (1) 4,920 4,920 4,920 — — Long-term borrowings 161,920 163,931 — — 163,931 Accrued interest payable (1) 1,671 1,671 1,671 — — (1) The financial instrument is carried at cost at December 31, 2019 , which approximate the fair value of the instruments The methods and assumptions used by the Company in estimating fair values of financial instruments at March 31, 2020 is in accordance with ASC Topic 825, Financial Instruments , as amended by ASU 2016-01 which requires public entities to use exit pricing in the calculation of the above tables. Loans: Fair values are estimated for portfolios of loans with similar financial characteristics. Loans are segregated by type such as commercial, financial, and agricultural, commercial real estate, residential real estate, construction real estate, and installment loans to individuals. Each loan category is further segmented into fixed and adjustable rate interest terms and by performing and nonperforming categories. The fair value of performing loans is calculated by discounting scheduled cash flows through the estimated maturity using estimated market discount rates that reflect the credit and interest rate risk inherent in the loan. The estimate of maturity is based on the Company’s historical experience with repayments for each loan classification, modified, as required, by an estimate of the effect of current economic and lending conditions. Fair value for significant nonperforming loans is based on recent external appraisals. If appraisals are not available, estimated cash flows are discounted using a rate commensurate with the risk associated with the estimated cash flows. Assumptions regarding credit risk, cash flows, and discounted rates are judgmentally determined using available market information and specific borrower information. Deposits: The fair value of deposits with no stated maturity, such as savings, NOW, and money market accounts, is equal to the amount payable on demand. The fair value of certificates of deposit is based on the discounted value of contractual cash flows. Long Term Borrowings: The fair value of long term borrowings is based on the discounted value of contractual cash flows. Commitments to Extend Credit, Standby Letters of Credit, and Financial Guarantees Written: There is no material difference between the notional amount and the estimated fair value of off-balance sheet items. The contractual amounts of unfunded commitments and letters of credit are presented in Note 9 (Off-Balance Sheet Risk). |
Stock Options
Stock Options | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock Options | Stock Options In 2014, the Company adopted the 2014 Equity Incentive Plan designed to help the Company attract, retain, and motivate employees and non-employee directors. Incentive stock options, non-qualified stock options, and restricted stock may be granted as part of the plan. As of January 1, 2020, the Company had a total of 625,800 stock options outstanding. During the period ended March 31, 2020, the Company issued 238,500 stock options with a strike price of $25.34 to a group of employees. The options granted in 2020 all expire ten years from the grant date. Of the 238,500 grants awarded in 2020, 119,300 of the options vest in 3 years while the 119,200 remaining options vest in five years . Stock Options Granted Date Shares Forfeited Outstanding Strike Price Vesting Period Expiration March 11, 2020 119,300 — 119,300 $ 25.34 3 years 10 years March 11, 2020 119,200 — 119,200 25.34 5 years 10 years March 15, 2019 120,900 (1,950 ) 118,950 28.01 3 years 10 years March 15, 2019 119,100 (1,800 ) 117,300 28.01 5 years 10 years August 24, 2018 75,300 (1,950 ) 73,350 30.67 3 years 10 years August 24, 2018 149,250 (4,050 ) 145,200 30.67 5 years 10 years January 5, 2018 18,750 — 18,750 30.07 3 years 10 years January 5, 2018 18,750 — 18,750 30.07 5 years 10 years March 24, 2017 69,375 (6,750 ) 62,625 29.47 3 years 10 years March 24, 2017 35,625 — 35,625 29.47 5 years 10 years August 27, 2015 58,125 (22,875 ) 35,250 28.02 5 years 10 years A summary of stock option activity is presented below: March 31, 2020 March 31, 2019 Shares Weighted Average Exercise Price Shares Weighted Average Exercise Price Outstanding, beginning of year 625,800 $ 29.29 395,550 $ 30.08 Granted 238,500 25.34 240,000 28.01 Exercised — — — — Forfeited — — — — Expired — — — — Outstanding, end of period 864,300 $ 28.20 635,550 $ 29.29 Exercisable, end of period 62,625 $ 29.47 — $ — The estimated fair value of options, including the effect of estimated forfeitures, is recognized as expense on a straightline basis over the options’ vesting periods while ensuring that the cumulative amount of compensation cost recognized at least equals the value of the vested portion of the award at that date. The Company determines the fair value of options granted using the Black-Scholes option-pricing model. The risk-free interest rate is based on the United States Treasury bond with a similar term to the expected life of the options at the grant date. Expected volatility was estimated based on the adjusted historic volatility of the Company’s shares. The expected life was estimated to equal the contractual life of the options. The dividend yield rate was based upon recent historical dividends paid on shares. Compensation expense for stock options is recognized using the fair value when the stock options are granted and is amortized over the options' vesting period. Compensation expense related to stock options was $198,000 for the three months ended March 31, 2020 compared to $136,000 for the same period of 2019 . As of March 31, 2020 , a total of 62,625 stock options were exercisable and the weighted average years to expiration was 8.67 years . The fair value of options granted during the three months ended March 31, 2020 was $1,343,000 or $5.63 per award. Total unrecognized compensation cost for non-vested options was $2,642,000 and will be recognized over their weighted average remaining vesting period of 1.66 years |
Leases
Leases | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Leases | Leases The following table shows finance lease right of use assets and finance lease liabilities as of March 31, 2020 : (In Thousands) Statement of Financial Condition classification March 31, 2020 December 31, 2019 Finance lease right of use assets Premises and equipment, net $ 5,406 $ 5,456 Finance lease liabilities Long-term borrowings 5,570 5,587 The following table shows the components of finance and operating lease expense for the three months ended March 31, 2020 and 2019: Three Months Ended March 31, (In Thousands) 2020 2019 Finance Lease Cost: Amortization of right-of-use asset $ 50 $ 65 Interest expense 53 56 Operating lease cost 91 88 Variable lease cost — 1 Total Lease Cost $ 194 $ 210 A maturity analysis of operating and finance lease liabilities and reconciliation of the undiscounted cash flows to the total operating lease liability is as follows: (In Thousands) Operating Finance 2020 $ 215 $ 211 2021 291 282 2022 298 283 2023 273 284 2024 263 290 2025 and thereafter 3,176 8,004 Total undiscounted cash flows 4,516 9,354 Discount on cash flows (1,217 ) (3,784 ) Total lease liability $ 3,299 $ 5,570 The following table shows the weighted average remaining lease term and weighted average discount rate for both operating and finance leases outstanding as of March 31, 2020 . Operating Finance Weighted-average term (years) 18.8 27.9 Weighted-average discount rate 3.51 % 3.77 % |
Leases | Leases The following table shows finance lease right of use assets and finance lease liabilities as of March 31, 2020 : (In Thousands) Statement of Financial Condition classification March 31, 2020 December 31, 2019 Finance lease right of use assets Premises and equipment, net $ 5,406 $ 5,456 Finance lease liabilities Long-term borrowings 5,570 5,587 The following table shows the components of finance and operating lease expense for the three months ended March 31, 2020 and 2019: Three Months Ended March 31, (In Thousands) 2020 2019 Finance Lease Cost: Amortization of right-of-use asset $ 50 $ 65 Interest expense 53 56 Operating lease cost 91 88 Variable lease cost — 1 Total Lease Cost $ 194 $ 210 A maturity analysis of operating and finance lease liabilities and reconciliation of the undiscounted cash flows to the total operating lease liability is as follows: (In Thousands) Operating Finance 2020 $ 215 $ 211 2021 291 282 2022 298 283 2023 273 284 2024 263 290 2025 and thereafter 3,176 8,004 Total undiscounted cash flows 4,516 9,354 Discount on cash flows (1,217 ) (3,784 ) Total lease liability $ 3,299 $ 5,570 The following table shows the weighted average remaining lease term and weighted average discount rate for both operating and finance leases outstanding as of March 31, 2020 . Operating Finance Weighted-average term (years) 18.8 27.9 Weighted-average discount rate 3.51 % 3.77 % |
Reclassification of Comparative
Reclassification of Comparative Amounts | 3 Months Ended |
Mar. 31, 2020 | |
Reclassification of Comparative Amounts | |
Reclassification of Comparative Amounts | Reclassification of Comparative Amounts Certain comparative amounts for the prior period have been reclassified to conform to current period presentations. Such reclassifications had no effect on net income or shareholders’ equity. |
Subsequent Events (Notes)
Subsequent Events (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events All events subsequent to the date of the consolidated financial statements through May 8, 2020, and for which U.S. GAAP requires adjustment or disclosure, have been adjusted or disclosed, including that the 2019 novel coronavirus (or COVID-19) has adversely affected, and may continue to adversely affect, economic activity globally, nationally, and locally. In response to COVID-19, among other things, the Company has incurred loan rate modifications and payment deferrals of up to 90 days. For further discussion, see COVID-19 Impact section of Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operation. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | The consolidated financial statements include the accounts of Penns Woods Bancorp, Inc. (the “Company”) and its wholly-owned subsidiaries: Woods Investment Company, Inc., Woods Real Estate Development Company, Inc., Luzerne Bank, and Jersey Shore State Bank (Jersey Shore State Bank and Luzerne Bank are referred to together as the “Banks”) and Jersey Shore State Bank’s wholly-owned subsidiary, The M Group, Inc. D/B/A The Comprehensive Financial Group (“The M Group”). The Company also owns a controlling interest in United Insurance Solutions, LLC. All significant inter-company balances and transactions have been eliminated in the consolidation. The interim financial statements are unaudited, but in the opinion of management reflect all adjustments necessary for the fair presentation of results for such periods. The results of operations for any interim period are not necessarily indicative of results for the full year. These financial statements should be read in conjunction with the financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 . |
Recent Accounting Pronouncements | In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments , 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 effected 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. ASU 2016-13 is effective for annual and interim periods beginning after December 15, 2019, and early adoption is permitted for annual and interim periods beginning after December 15, 2018. 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. On October 16, 2019, the FASB voted to defer the effective date for ASC 326, Financial Instruments - Credit Losses , for smaller reporting companies to fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. 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. In January 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment . To simplify the subsequent measurement of goodwill, the FASB eliminated Step 2 from the goodwill impairment test. In computing the implied fair value of goodwill under Step 2, an entity had to perform procedures to determine the fair value at the impairment testing date of its assets and liabilities (including unrecognized assets and liabilities) following the procedure that would be required in determining the fair value of assets acquired and liabilities assumed in a business combination. Instead, under the amendments in this Update, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting units fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. A public business entity that is a U.S. Securities and Exchange Commission (SEC) filer should adopt the amendments in this Update for its annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. A public business entity that is not an SEC filer should adopt the amendments in this Update for its annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2020. All other entities, including not-for-profit entities, that are adopting the amendments in this Update should do so for their annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2021. On October 16, 2019, the FASB voted to defer the effective date for ASC 350 , Intangibles - Goodwill and Other , for smaller reporting companies to fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. This Update is not expected to have a significant impact on the Company’s financial statements. In August 2018, the FASB issued ASU 2018-14, Compensation - Retirement Benefits (Topic 715-20). This Update amends ASC 715 to add, remove and clarify disclosure requirements related to defined benefit pension and other postretirement plans. The Update eliminates the requirement to disclose the amounts in accumulated other comprehensive income expected to be recognized as part of net periodic benefit cost over the next year. The Update also removes the disclosure requirements for the effects of a one-percentage-point change on the assumed health care costs and the effect of this change in rates on service cost, interest cost and the benefit obligation for postretirement health care benefits. This Update is effective for public business entities for fiscal years ending after December 15, 2020, and must be applied on a retrospective basis. For all other entities, this Update is effective for fiscal years ending after December 15, 2021. This Update is not expected to have a significant impact on the Company’s financial statements. In August 2018, the FASB issued ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40). This Update addresses customers’ accounting for implementation costs incurred in a cloud computing arrangement that is a service contract and also adds certain disclosure requirements related to implementation costs incurred for internal-use software and cloud computing arrangements. The amendment aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). This Update is effective for public business entities for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2020, and interim periods within fiscal years beginning after December 15, 2021. The amendments in this Update can be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. On October 16, 2019, the FASB voted to defer the effective date for ASC 350 , Intangibles - Goodwill and Other , for smaller reporting companies to fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. This Update is not expected to have a significant impact on the Company’s financial statements. In October 2018, the FASB issued ASU 2018-16 , Derivatives and Hedging (Topic 815) . The amendments in this Update permit use of the Overnight Index Swap (OIS) rate based on the Secured Overnight Financing Rate (SOFR) as a U.S. benchmark interest rate for hedge accounting purposes under Topic 815, in addition to the interest rates on direct Treasury obligations of the U.S. government, the London Interbank Offered Rate (LIBOR) swap rate, the OIS rate based on the Fed Funds Effective Rate, and the Securities Industry and Financial Markets Association (SIFMA) Municipal Swap Rate. For entities that have not already adopted Update 2017-12, the amendments in this Update are required to be adopted concurrently with the amendments in Update 2017-12. For public business entities that already have adopted the amendments in Update 2017-12, the amendments are effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. For all other entities that already have adopted the amendments in Update 2017-12, the amendments are effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. Early adoption is permitted in any interim period upon issuance of this Update if an entity already has adopted Update 2017-12. This Update is not expected to have a significant impact on the Company’s financial statements. In April 2019, the FASB issued ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments - Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments, which affects a variety of topics in the Codification and applies to all reporting entities within the scope of the affected accounting guidance. Topic 326, Financial Instruments - Credit Losses amendments are effective for SEC registrants for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. For all other public business entities, the effective date is for fiscal years beginning after December 15, 2020, and for all other entities, the effective date is for fiscal years beginning after December 15, 2021.On October 16, 2019, the FASB voted to defer the effective date for ASC 326, Financial Instruments - Credit Losses , for smaller reporting companies to fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. The final ASU is expected to be issued in mid-November. Topic 815, Derivatives and Hedging amendments are effective for public business entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2019, and interim periods beginning after December 15, 2020. For entities that have adopted the amendments in Update 2017- 12, the effective date is as of the beginning of the first annual period beginning after the issuance of this Update. Topic 825, Financial Instruments amendments are effective for fiscal years beginning after December 15, 2019, and interim periods within fiscal years. This Update is not expected to have a significant impact on the Company’s financial statements. In May 2019, the FASB issued ASU 2019-05, Financial Instruments - Credit Losses, Topic 326 , which allows entities to irrevocably elect the fair value option for certain financial assets previously measured at amortized cost upon adoption of the new credit losses standard. To be eligible for the transition election, the existing financial asset must otherwise be both within the scope of the new credit losses standard and eligible for the applying the fair value option in ASC 825-10.3. The election must be applied on an instrument-by-instrument basis and is not available for either available-for-sale or held-to-maturity debt securities. For entities that elect the fair value option, the difference between the carrying amount and the fair value of the financial asset would be recognized through a cumulative-effect adjustment to opening retained earnings as of the date an entity adopted ASU 2016-13. Changes in fair value of that financial asset would subsequently be reported in current earnings. For entities that have not yet adopted ASU 2016-13, the effective dates and transition requirements are the same as those in ASU 2016-13. For entities that have adopted ASU 2016-13, ASU 2019-05 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted once ASU 2016-13 has been adopted. On October 16, 2019, the FASB voted to defer the effective date for ASC 326, Financial Instruments - Credit Losses , for smaller reporting companies to fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. This Update is not expected to have a significant impact on the Company’s financial statements. In November 2019, the FASB issued ASU 2019-09, Financial Services - Insurance (Topic 944) , which defers the effective date of the amendments in Update 2018-12, Financial Services - Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts . For public business entities that meet the definition of an SEC filer, excluding entities eligible to be smaller reporting companies, as defined by the SEC, the amendments in Update 2018-12 are effective for fiscal years beginning after December 15, 2021, and interim periods within those fiscal years. Early application of the amendments in Update 2018-12 is permitted. For all other entities, the amendments in Update 2018-12 are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early application of the amendments in Update 2018-12 is permitted. This Update is not expected to have a significant impact on the Company’s financial statements. In November 2019, the FASB issued ASU 2019-10, Financial Instruments - Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842) . The Update defers the effective dates 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. This Update also amends the mandatory effective date for the elimination of Step 2 from the goodwill impairment test under ASU No. 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (Goodwill) , to align with those used for credit losses. Furthermore, the ASU provides a one-year deferral of the effective dates of the ASUs on derivatives and hedging and leases for companies that are not public business entities. The Company qualifies as a smaller reporting company and does not expect to early adopt these ASUs. In November 2019, the FASB issued ASU 2019-11, Codification Improvements to Topic 326, Financial Instruments - Credit Losses , to clarify its new credit impairment guidance in ASC 326, based on implementation issues raised by stakeholders. This Update clarified, among other things, that expected recoveries are to be included in the allowance for credit losses for these financial assets; an accounting policy election can be made to adjust the effective interest rate for existing troubled debt restructurings based on the prepayment assumptions instead of the prepayment assumptions applicable immediately prior to the restructuring event; and extends the practical expedient to exclude accrued interest receivable from all additional relevant disclosures involving amortized cost basis. The effective dates in this Update are the same as those applicable for ASU 2019-10. This Update is not expected to have a significant impact on the Company’s financial statements. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740) , to simplify the accounting for income taxes, change the accounting for certain tax transactions, and make minor improvements to the codification. This Update provides a policy election to not allocate consolidated income taxes when a member of a consolidated tax return is not subject to income tax and provides guidance to evaluate whether a step-up in tax basis of goodwill relates to a business combination in which book goodwill was recognized or a separate transaction. The Update also changes current guidance for making an intraperiod allocation, if there is a loss in continuing operations and gains outside of continuing operations; determining when a deferred tax liability is recognized after an investor in a foreign entity transitions to or from the equity method of accounting; accounting for tax law changes and year-to-date losses in interim periods; and determining how to apply the income tax guidance to franchise taxes that are partially based on income. For public business entities, the amendments in this Update are effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2020. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2021, and interim periods within fiscal years beginning after December 15, 2022. This Update is not expected to have a significant impact on the Company’s financial statements. In January 2020, the FASB issued ASU 2020-1, Investments - Equity Securities (Topic 321), Investments - Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) , to clarify that an entity should consider observable transactions that require it to either apply or discontinue the equity method of accounting for the purposes of applying the measurement alternative in accordance with Topic 321 immediately before applying or upon discontinuing the equity method. The amendments also clarify that, for the purpose of applying paragraph 815-10-15-141(a) an entity should not consider whether, upon the settlement of the forward contract or exercise of the purchased option, individually or with existing investments, the underlying securities would be accounted for under the equity method in Topic 323 or the fair value option, in accordance with the financial instruments guidance in Topic 825. An entity also would evaluate the remaining characteristics in paragraph 815-10-15-141 to determine the accounting for those forward contracts and purchased options. For public business entities, the amendments in this Update are effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2021, and interim periods within those fiscal years. This Update is not expected to have a significant impact on the Company’s financial statements. In January 2020, the FASB issued ASU 2020-2, Financial Instruments - Credit Losses (Topic 326) and Leases (Topic 842): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 119 and Update to SEC Section on Effective Date Related to Accounting Standards Update No. 2016-02, Leases (Topic 842), to add and amend SEC paragraphs in the Accounting Standards Codification to reflect the issuance of SEC Staff Accounting Bulletin No. 119, related to the new credit losses standard, and comments by the SEC staff related to the revised effective date of the new leases standard. This ASU is effective upon issuance. This did not have a significant impact on the Company’s financial statements. In March 2020, the FASB issued ASU 2020-3 , Codification Improvements to Financial Instruments. This ASU was issued to improve and clarify various financial instruments topics, including the current expected credit losses (CECL) standard issued in 2016. The ASU includes seven issues that describe the areas of improvement and the related amendments to GAAP; they are intended to make the standards easier to understand and apply and to eliminate inconsistencies, and they are narrow in scope and are not expected to significantly change practice for most entities. Among its provisions, the ASU clarifies that all entities, other than public business entities that elected the fair value option, are required to provide certain fair value disclosures under ASC 825, Financial Instruments , in both interim and annual financial statements. It also clarifies that the contractual term of a net investment in a lease under Topic 842 should be the contractual term used to measure expected credit losses under Topic 326. Amendments related to ASU 2019-04 are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is not permitted before an entity’s adoption of ASU 2016-01. Amendments related to ASU 2016-13 for entities that have not yet adopted that guidance are effective upon adoption of the amendments in ASU 2016-13. Early adoption is not permitted before an entity’s adoption of ASU 2016-13. Amendments related to ASU 2016-13 for entities that have adopted that guidance are effective for fiscal years beginning after December 15, 2019, including interim periods within those years. Other amendments are effective upon issuance of this ASU. This Update is not expected to have a significant impact on the Company’s financial statements. 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, to provide temporary optional expedients and exceptions to the U.S. GAAP guidance on contract modifications and hedge accounting to ease the financial reporting burdens of the expected market transition from LIBOR and other interbank offered rates 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. Also, entities can elect various optional expedients that would allow them to continue applying hedge accounting for hedging relationships affected by reference rate reform, if certain criteria are met, and can make a one-time election to sell and/or reclassify held-to-maturity debt securities that reference an interest rate affected by reference rate reform. The amendments in this ASU are effective for all entities upon issuance through December 31, 2022. The Company is currently evaluating the impact the adoption of the standard will have on the Company’s financial position or results of operations. |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Gain (Loss) (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |
Schedule of changes in accumulated other comprehensive income by component | The changes in accumulated other comprehensive gain (loss) by component shown net of tax and parenthesis indicating debits, as of March 31, 2020 and 2019 were as follows: Three Months Ended March 31, 2020 Three Months Ended March 31, 2019 (In Thousands) Net Unrealized Gain (Loss) on Available for Sale Securities Defined Benefit Plan Total Net Unrealized Gain (Loss) on Available for Sale Securities Defined Benefit Plan Total Beginning balance $ 2,455 $ (5,232 ) $ (2,777 ) $ (1,360 ) $ (5,276 ) $ (6,636 ) Other comprehensive gain before reclassifications 548 — 548 1,567 — 1,567 Amounts reclassified from accumulated other comprehensive (loss) gain (17 ) 33 16 (10 ) 37 27 Net current-period other comprehensive income 531 33 564 1,557 37 1,594 Ending balance $ 2,986 $ (5,199 ) $ (2,213 ) $ 197 $ (5,239 ) $ (5,042 ) |
Schedule of reclassifications out of accumulated other comprehensive income | The reclassifications out of accumulated other comprehensive loss shown, net of tax and parenthesis indicating debits to net income, as of March 31, 2020 and 2019 were as follows: Details about Accumulated Other Comprehensive Loss Components Amount Reclassified from Accumulated Other Comprehensive Loss Affected Line Item in the Consolidated Statement of Income Three months ended March 31, 2020 Three months ended March 31, 2019 Net unrealized gain on available for sale securities $ 21 $ 13 Net debt securities gains, available for sale Income tax effect (4 ) (3 ) Income tax provision Total reclassifications for the period $ 17 $ 10 Net unrecognized pension costs $ (41 ) $ (47 ) Salaries and employee benefits Income tax effect 8 10 Income tax provision Total reclassifications for the period $ (33 ) $ (37 ) |
Per Share Data (Tables)
Per Share Data (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of weighted average common shares (denominator) used in the basic and dilutive earnings per share computation | Three Months Ended March 31, 2020 2019 Weighted average common shares issued 7,520,965 7,517,853 Weighted average treasury stock shares (480,225 ) (480,225 ) Weighted average common shares outstanding - basic 7,040,740 7,037,628 Dilutive effect of outstanding stock options 62,250 — Weighted average common shares outstanding - basic and diluted 7,102,990 7,037,628 |
Investment Securities (Tables)
Investment Securities (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of amortized cost, gross unrealized gains and losses, and fair values of equity and trading investment securities | The amortized cost, gross unrealized gains and losses, and fair values of our investment securities portfolio at March 31, 2020 and December 31, 2019 are as follows: March 31, 2020 Gross Gross Amortized Unrealized Unrealized Fair (In Thousands) Cost Gains Losses Value Available for sale (AFS): Mortgage-backed securities $ 4,874 $ 125 $ — $ 4,999 State and political securities 87,545 4,574 (79 ) 92,040 Other debt securities 59,323 543 (1,383 ) 58,483 Total debt securities $ 151,742 $ 5,242 $ (1,462 ) $ 155,522 Investment equity securities: Other equity securities $ 1,300 $ 7 $ (26 ) $ 1,281 Trading: Other equity securities $ 50 $ — $ (13 ) $ 37 December 31, 2019 Gross Gross Amortized Unrealized Unrealized Fair (In Thousands) Cost Gains Losses Value Available for sale (AFS): Mortgage-backed securities $ 4,956 $ 56 $ (46 ) $ 4,966 State and political securities 79,064 3,299 (77 ) 82,286 Other debt securities 61,492 401 (526 ) 61,367 Total debt securities $ 145,512 $ 3,756 $ (649 ) $ 148,619 Investment equity securities: Other equity securities $ 1,300 $ — $ (39 ) $ 1,261 Trading: Other equity securities $ 50 $ 3 $ (2 ) $ 51 |
Schedule of gross unrealized losses and fair value | The following tables show the Company’s gross unrealized losses and fair value, aggregated by investment category and length of time, that the individual debt securities have been in a continuous unrealized loss position, at March 31, 2020 and December 31, 2019 . March 31, 2020 Less than Twelve Months Twelve Months or Greater Total Gross Gross Gross Fair Unrealized Fair Unrealized Fair Unrealized (In Thousands) Value Losses Value Losses Value Losses Available for sale (AFS): Mortgage-backed securities $ — $ — $ — $ — $ — $ — State and political securities 5,887 (61 ) 242 (18 ) 6,129 (79 ) Other debt securities 21,691 (1,068 ) 11,185 (315 ) 32,876 (1,383 ) Total debt securities $ 27,578 $ (1,129 ) $ 11,427 $ (333 ) $ 39,005 $ (1,462 ) December 31, 2019 Less than Twelve Months Twelve Months or Greater Total Gross Gross Gross Fair Unrealized Fair Unrealized Fair Unrealized (In Thousands) Value Losses Value Losses Value Losses Available for sale (AFS): Mortgage-backed securities $ — $ — $ 2,115 $ (46 ) $ 2,115 $ (46 ) State and political securities 7,958 (40 ) 224 (37 ) 8,182 (77 ) Other debt securities 13,373 (216 ) 14,258 (310 ) 27,631 (526 ) Total debt securities $ 21,331 $ (256 ) $ 16,597 $ (393 ) $ 37,928 $ (649 ) |
Schedule of amortized cost and fair value of debt securities by contractual maturity | The amortized cost and fair value of debt securities at March 31, 2020 , by contractual maturity, are shown below. Expected maturities may differ from contractual maturities since borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. (In Thousands) Amortized Cost Fair Value Due in one year or less $ 5,642 $ 5,657 Due after one year to five years 55,063 55,073 Due after five years to ten years 67,078 70,403 Due after ten years 23,959 24,389 Total $ 151,742 $ 155,522 |
Schedule of gross realized gains and losses | The following table represents gross realized gains and losses from the sales of debt securities available for sale: Three Months Ended March 31, (In Thousands) 2020 2019 Available for sale (AFS): Gross realized gains: State and political securities $ 1 $ 15 Other debt securities 20 4 Total gross realized gains $ 21 $ 19 Gross realized losses: State and political securities $ — $ 2 Other debt securities — 4 Total gross realized losses $ — $ 6 |
Schedule of unrealized and realized gains and losses recognized in net income | The following is a summary of unrealized and realized gains and losses recognized in net income on equity securities during the three months ended March 31, 2020 and 2019 : Three Months Ended March 31, (In Thousands) 2020 2019 Net (losses) gains recognized in equity securities during the period $ 20 $ 43 Less: Net gains realized on the sale of equity securities during the period — — Unrealized (losses) gains recognized in equity securities held at reporting date $ 20 $ 43 Net gains and losses on trading account securities are as follows for the three months ended March 31, 2020 and 2019 : Three Months Ended March 31, (In Thousands) 2020 2019 Net gains on sale transactions $ — $ 5 Net mark-to-market (losses) gains (14 ) 5 Net (loss) gain on trading account securities $ (14 ) $ 10 |
Loans (Tables)
Loans (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Loans and Leases Receivable Disclosure [Abstract] | |
Schedule of related aging categories of loans by segment | The following table presents the related aging categories of loans, by segment, as of March 31, 2020 and December 31, 2019 : March 31, 2020 Past Due Past Due 90 30 To 89 Days Or More Non- (In Thousands) Current Days & Still Accruing Accrual Total Commercial, financial, and agricultural $ 155,692 $ 489 $ 31 $ 1,938 $ 158,150 Real estate mortgage: Residential 607,445 6,321 1,383 1,005 616,154 Commercial 351,202 2,795 — 6,740 360,737 Construction 39,003 230 — 64 39,297 Consumer automobile loans 150,891 700 74 50 151,715 Other consumer installment loans 21,451 522 15 — 21,988 1,325,684 $ 11,057 $ 1,503 $ 9,797 1,348,041 Net deferred loan fees and discounts 1,359 1,359 Allowance for loan losses (12,500 ) (12,500 ) Loans, net $ 1,314,543 $ 1,336,900 December 31, 2019 Past Due Past Due 90 30 To 89 Days Or More Non- (In Thousands) Current Days & Still Accruing Accrual Total Commercial, financial, and agricultural $ 153,737 $ 249 $ 30 $ 2,197 $ 156,213 Real estate mortgage: Residential 615,580 4,881 1,529 1,266 623,256 Commercial 355,597 775 164 6,725 363,261 Construction 37,871 131 — 65 38,067 Consumer automobile loans 149,703 709 — 105 150,517 Other consumer installment loans 22,124 579 324 16 23,043 1,334,612 $ 7,324 $ 2,047 $ 10,374 1,354,357 Net deferred loan fees and discounts 1,187 1,187 Allowance for loan losses (11,894 ) (11,894 ) Loans, net $ 1,323,905 $ 1,343,650 |
Schedule of interest income if interest had been recorded based on the original loan agreement terms and rate of interest for non-accrual loans and interest income recognized on a cash basis for non-accrual loans | The following table presents interest income the Banks would have recorded if interest had been recorded based on the original loan agreement terms and rate of interest for non-accrual loans and interest income recognized on a cash basis for non-accrual loans for the three months ended March 31, 2020 and 2019 : Three Months Ended March 31, 2020 2019 (In Thousands) Interest Income That Would Have Been Recorded Based on Original Term and Rate Interest Income Recorded on a Cash Basis Interest Income That Would Have Been Recorded Based on Original Term and Rate Interest Income Recorded on a Cash Basis Commercial, financial, and agricultural $ 9 $ — $ 24 $ 39 Real estate mortgage: Residential 9 — 33 23 Commercial 42 — 89 40 Construction — — 1 1 Consumer automobile loans 2 — 2 1 Other consumer installment loans — — 1 — $ 62 $ — $ 150 $ 104 |
Schedule of recorded investment, unpaid principal balance, and related allowance of impaired loans by segment | The following table presents the recorded investment, unpaid principal balance, and related allowance of impaired loans by segment as of March 31, 2020 and December 31, 2019 : March 31, 2020 Recorded Unpaid Principal Related (In Thousands) Investment Balance Allowance With no related allowance recorded: Commercial, financial, and agricultural $ 1,921 $ 4,708 $ — Real estate mortgage: Residential 4,656 4,656 — Commercial 5,089 5,089 — Construction 65 65 — Consumer automobile loans — — — Installment loans to individuals — — — 11,731 14,518 — With an allowance recorded: Commercial, financial, and agricultural 104 104 — Real estate mortgage: Residential 1,074 1,074 177 Commercial 3,472 3,522 1,062 Construction — — — Consumer automobile loans 21 21 5 Installment loans to individuals — — — 4,671 4,721 1,244 Total: Commercial, financial, and agricultural 2,025 4,812 — Real estate mortgage: Residential 5,730 5,730 177 Commercial 8,561 8,611 1,062 Construction 65 65 — Consumer automobile loans 21 21 5 Installment loans to individuals — — — $ 16,402 $ 19,239 $ 1,244 December 31, 2019 Recorded Unpaid Principal Related (In Thousands) Investment Balance Allowance With no related allowance recorded: Commercial, financial, and agricultural $ 2,285 $ 5,072 $ — Real estate mortgage: Residential 5,008 5,008 — Commercial 5,035 5,035 — Construction 65 65 — Consumer automobile loans — — — Installment loans to individuals — — — 12,393 15,180 — With an allowance recorded: Commercial, financial, and agricultural — — — Real estate mortgage: Residential 1,168 1,200 211 Commercial 3,540 3,590 1,104 Construction — — — Consumer automobile loans 130 130 62 Installment loans to individuals 16 16 16 4,854 4,936 1,393 Total: Commercial, financial, and agricultural 2,285 5,072 — Real estate mortgage: Residential 6,176 6,208 211 Commercial 8,575 8,625 1,104 Construction 65 65 — Consumer automobile loans 130 130 62 Installment loans to individuals 16 16 16 $ 17,247 $ 20,116 $ 1,393 |
Schedule of average recorded investment in impaired loans and related interest income recognized | The following table presents the average recorded investment in impaired loans and related interest income recognized for the three months ended March 31, 2020 and 2019 : Three Months Ended March 31, 2020 2019 (In Thousands) Average Investment in Impaired Loans Interest Income Recognized on an Accrual Basis on Impaired Loans Interest Income Recognized on a Cash Basis on Impaired Loans Average Investment in Impaired Loans Interest Income Recognized on an Accrual Basis on Impaired Loans Interest Income Recognized on a Cash Basis on Impaired Loans Commercial, financial, and agricultural $ 2,155 $ 1 $ — $ 5,302 $ 1 $ 38 Real estate mortgage: Residential 5,953 57 — 4,163 28 17 Commercial 8,568 26 — 11,069 31 36 Construction 65 — — 73 — 1 Consumer automobile 76 — — 52 — 1 Other consumer installment loans 8 — — 18 — — $ 16,825 $ 84 $ — $ 20,677 $ 60 $ 93 |
Schedule of credit quality categories | The following table presents the credit quality categories identified above as of March 31, 2020 and December 31, 2019 : March 31, 2020 Commercial, Financial, and Agricultural Real Estate Mortgages Consumer automobile Other consumer installment loans (In Thousands) Residential Commercial Construction Totals Pass $ 151,756 $ 611,584 $ 346,727 $ 39,163 $ 151,715 $ 21,985 $ 1,322,930 Special Mention 3,154 2,416 5,018 — — — 10,588 Substandard 3,240 2,154 8,992 134 — 3 14,523 $ 158,150 $ 616,154 $ 360,737 $ 39,297 $ 151,715 $ 21,988 $ 1,348,041 December 31, 2019 Commercial, Financial, and Agricultural Real Estate Mortgages Consumer automobile Other consumer installment loans (In Thousands) Residential Commercial Construction Totals Pass $ 149,349 $ 618,350 $ 348,864 $ 37,931 $ 150,517 $ 23,039 $ 1,328,050 Special Mention 3,174 2,436 5,080 — — — 10,690 Substandard 3,690 2,470 9,317 136 — 4 15,617 $ 156,213 $ 623,256 $ 363,261 $ 38,067 $ 150,517 $ 23,043 $ 1,354,357 |
Schedule of activity in the allowance | Activity in the allowance is presented for the three months ended March 31, 2020 and 2019 : t Three Months Ended March 31, 2020 Commercial, Financial, and Agricultural Real Estate Mortgages Consumer automobile Other consumer installment (In Thousands) Residential Commercial Construction Unallocated Totals Beginning Balance $ 1,779 $ 4,306 $ 3,210 $ 118 $ 1,780 $ 278 $ 423 $ 11,894 Charge-offs (14 ) (41 ) — — (75 ) (100 ) — (230 ) Recoveries 21 21 — 2 1 41 — 86 Provision 111 251 204 40 149 48 (53 ) 750 Ending Balance $ 1,897 $ 4,537 $ 3,414 $ 160 $ 1,855 $ 267 $ 370 $ 12,500 Three Months Ended March 31, 2019 Commercial, Financial, and Agricultural Real Estate Mortgages Consumer automobile Other consumer installment (In Thousands) Residential Commercial Construction Unallocated Totals Beginning Balance $ 1,680 $ 5,616 $ 4,047 $ 143 $ 1,328 $ 259 $ 764 $ 13,837 Charge-offs (50 ) (73 ) (139 ) — (100 ) (96 ) — (458 ) Recoveries 6 1 — 5 26 15 — 53 Provision 96 186 (106 ) (18 ) 148 100 (46 ) 360 Ending Balance $ 1,732 $ 5,730 $ 3,802 $ 130 $ 1,402 $ 278 $ 718 $ 13,792 |
Schedule of concentration of loan | The Company has a concentration of the following to gross loans at March 31, 2020 and 2019 : March 31, 2020 2019 Owners of residential rental properties 16.04 % 14.82 % Owners of commercial rental properties 12.53 % 12.07 % |
Schedule of allowance for loan losses and the recorded investment in loans by portfolio segment based on impairment method | The following table presents the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment based on impairment method as of March 31, 2020 and December 31, 2019 : March 31, 2020 Commercial, Financial, and Agricultural Real Estate Mortgages Consumer Automobile Other consumer installment Unallocated (In Thousands) Residential Commercial Construction Totals Allowance for Loan Losses: Ending allowance balance attributable to loans: Individually evaluated for impairment $ — $ 177 $ 1,062 $ — $ 5 $ — $ — $ 1,244 Collectively evaluated for impairment 1,897 4,360 2,352 160 1,850 267 370 11,256 Total ending allowance balance $ 1,897 $ 4,537 $ 3,414 $ 160 $ 1,855 $ 267 $ 370 $ 12,500 Loans: Individually evaluated for impairment $ 2,025 $ 5,730 $ 8,561 $ 65 $ 21 $ — $ 16,402 Collectively evaluated for impairment 156,125 610,424 352,176 39,232 151,694 21,988 1,331,639 Total ending loans balance $ 158,150 $ 616,154 $ 360,737 $ 39,297 $ 151,715 $ 21,988 $ 1,348,041 December 31, 2019 Commercial, Financial, and Agricultural Real Estate Mortgages Consumer Automobile Other consumer installment Unallocated (In Thousands) Residential Commercial Construction Totals Allowance for Loan Losses: Ending allowance balance attributable to loans: Individually evaluated for impairment $ — $ 211 $ 1,104 $ — $ 62 $ 16 $ — $ 1,393 Collectively evaluated for impairment 1,779 4,095 2,106 118 1,718 262 423 10,501 Total ending allowance balance $ 1,779 $ 4,306 $ 3,210 $ 118 $ 1,780 $ 278 $ 423 $ 11,894 Loans: Individually evaluated for impairment $ 2,285 $ 6,176 $ 8,575 $ 65 $ 130 $ 16 $ 17,247 Collectively evaluated for impairment 153,928 617,080 354,686 38,002 150,387 23,027 1,337,110 Total ending loans balance $ 156,213 $ 623,256 $ 363,261 $ 38,067 $ 150,517 $ 23,043 $ 1,354,357 |
Net Periodic Benefit Cost-Def_2
Net Periodic Benefit Cost-Defined Benefit Plans (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Pension and Other Postretirement Benefits Cost (Reversal of Cost) [Abstract] | |
Schedule of components of the net periodic benefit/cost of the domestic non-contributory defined benefit plan | The following sets forth the components of the net periodic benefit/cost of the domestic non-contributory defined benefit plan for the three months ended March 31, 2020 and 2019 , respectively: Three Months Ended March 31, (In Thousands) 2020 2019 Interest cost $ 160 $ 191 Expected return on plan assets (318 ) (249 ) Amortization of net loss 41 47 Net periodic benefit $ (117 ) $ (11 ) |
Off Balance Sheet Risk (Tables)
Off Balance Sheet Risk (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Off Balance Sheet Risk | |
Schedule of Financial instruments whose contract amounts represent credit risk | Financial instruments whose contract amounts represent credit risk are as follows at March 31, 2020 and December 31, 2019 : (In Thousands) March 31, 2020 December 31, 2019 Commitments to extend credit $ 191,676 $ 187,778 Standby letters of credit 9,976 9,638 Credit exposure from the sale of assets with recourse 7,091 6,826 $ 208,743 $ 204,242 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of assets reported on the balance sheet at their fair value on a recurring basis | The following table presents the assets reported on the Consolidated Balance Sheet at their fair value on a recurring basis as of March 31, 2020 and December 31, 2019 , by level within the fair value hierarchy. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. March 31, 2020 (In Thousands) Level I Level II Level III Total Assets measured on a recurring basis: Investment securities, available for sale: Mortgage-backed securities $ — $ 4,999 $ — $ 4,999 State and political securities — 92,040 — 92,040 Other debt securities — 58,483 — 58,483 Investment equity securities: Other equity securities 1,281 — — 1,281 Investment securities, trading: Other equity securities 37 — — 37 December 31, 2019 (In Thousands) Level I Level II Level III Total Assets measured on a recurring basis: Investment securities, available for sale: Mortgage-backed securities $ — $ 4,966 $ — $ 4,966 State and political securities — 82,286 — 82,286 Other debt securities — 61,367 — 61,367 Investment equity securities: Other equity securities 1,261 — — 1,261 Investment securities, trading: Other equity securities 51 — — 51 |
Schedule of assets reported on the consolidated balance sheet at their fair value on a non-recurring basis | The following table presents the assets reported on the Consolidated Balance Sheet at their fair value on a non-recurring basis as of March 31, 2020 and December 31, 2019 , by level within the fair value hierarchy. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. March 31, 2020 (In Thousands) Level I Level II Level III Total Assets measured on a non-recurring basis: Impaired loans $ — $ — $ 15,158 $ 15,158 Other real estate owned — — 308 308 December 31, 2019 (In Thousands) Level I Level II Level III Total Assets measured on a non-recurring basis: Impaired loans $ — $ — $ 15,854 $ 15,854 Other real estate owned — — 413 413 |
Schedule of listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | The following tables present a listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques as of March 31, 2020 and December 31, 2019 : March 31, 2020 Quantitative Information About Level III Fair Value Measurements (In Thousands) Fair Value Valuation Technique(s) Unobservable Inputs Range Weighted Average Impaired loans $ 6,891 Discounted cash flow Temporary reduction in payment amount 17% to (59)% (24)% 8,267 Appraisal of collateral (1) Appraisal adjustments (1) 0 to (80)% (10)% Other real estate owned $ 308 Appraisal of collateral (1) Appraisal adjustments (1) (20)% (20)% (1) Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated liquidation expenses. December 31, 2019 Quantitative Information About Level III Fair Value Measurements (In Thousands) Fair Value Valuation Technique(s) Unobservable Inputs Range Weighted Average Impaired loans $ 6,950 Discounted cash flow Temporary reduction in payment amount 17 to (59)% (24)% 8,904 Appraisal of collateral (1) Appraisal adjustments (1) 0 to (30)% (9)% Other real estate owned $ 413 Appraisal of collateral (1) Appraisal adjustments (1) (20)% (20)% (1) Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated liquidation expenses. |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of fair value of financial instruments | The fair values of the Company’s financial instruments not recorded at fair value on a recurring or nonrecurring basis are as follows at March 31, 2020 and December 31, 2019 : Carrying Fair Fair Value Measurements at March 31, 2020 (In Thousands) Value Value Level I Level II Level III Financial assets: Cash and cash equivalents (1) $ 77,761 $ 77,761 $ 77,761 $ — $ — Restricted investment in bank stock (1) 14,611 14,611 14,611 — — Loans held for sale (1) 4,294 4,294 4,294 — — Loans, net 1,336,900 1,325,148 — — 1,325,148 Bank-owned life insurance (1) 29,228 29,228 29,228 — — Accrued interest receivable (1) 5,307 5,307 5,307 — — Financial liabilities: Interest-bearing deposits $ 993,975 $ 999,579 $ 618,680 $ — $ 380,899 Noninterest-bearing deposits (1) 332,759 332,759 332,759 — — Short-term borrowings (1) 17,741 17,741 17,741 — — Long-term borrowings 171,903 176,801 — — 176,801 Accrued interest payable (1) 1,635 1,635 1,635 — — (1) The financial instrument is carried at cost at March 31, 2020 , which approximate the fair value of the instruments Carrying Fair Fair Value Measurements at December 31, 2019 (In Thousands) Value Value Level I Level II Level III Financial assets: Cash and cash equivalents (1) $ 48,589 $ 48,589 $ 48,589 $ — $ — Restricted investment in bank stock (1) 13,528 13,528 13,528 — — Loans held for sale (1) 4,232 4,232 4,232 — — Loans, net 1,343,650 1,346,395 — — 1,346,395 Bank-owned life insurance (1) 29,253 29,253 29,253 — — Accrued interest receivable (1) 5,246 5,246 5,246 — — Financial liabilities: Interest-bearing deposits $ 989,259 $ 990,747 $ 611,374 $ — $ 379,373 Noninterest-bearing deposits (1) 334,746 334,746 334,746 — — Short-term borrowings (1) 4,920 4,920 4,920 — — Long-term borrowings 161,920 163,931 — — 163,931 Accrued interest payable (1) 1,671 1,671 1,671 — — (1) The financial instrument is carried at cost at December 31, 2019 , which approximate the fair value of the instruments |
Stock Options (Tables)
Stock Options (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Share-based Compensation, Stock Options Granted | Stock Options Granted Date Shares Forfeited Outstanding Strike Price Vesting Period Expiration March 11, 2020 119,300 — 119,300 $ 25.34 3 years 10 years March 11, 2020 119,200 — 119,200 25.34 5 years 10 years March 15, 2019 120,900 (1,950 ) 118,950 28.01 3 years 10 years March 15, 2019 119,100 (1,800 ) 117,300 28.01 5 years 10 years August 24, 2018 75,300 (1,950 ) 73,350 30.67 3 years 10 years August 24, 2018 149,250 (4,050 ) 145,200 30.67 5 years 10 years January 5, 2018 18,750 — 18,750 30.07 3 years 10 years January 5, 2018 18,750 — 18,750 30.07 5 years 10 years March 24, 2017 69,375 (6,750 ) 62,625 29.47 3 years 10 years March 24, 2017 35,625 — 35,625 29.47 5 years 10 years August 27, 2015 58,125 (22,875 ) 35,250 28.02 5 years 10 years A summary of stock option activity is presented below: March 31, 2020 March 31, 2019 Shares Weighted Average Exercise Price Shares Weighted Average Exercise Price Outstanding, beginning of year 625,800 $ 29.29 395,550 $ 30.08 Granted 238,500 25.34 240,000 28.01 Exercised — — — — Forfeited — — — — Expired — — — — Outstanding, end of period 864,300 $ 28.20 635,550 $ 29.29 Exercisable, end of period 62,625 $ 29.47 — $ — |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Schedule of Assets and Liabilities | The following table shows finance lease right of use assets and finance lease liabilities as of March 31, 2020 : (In Thousands) Statement of Financial Condition classification March 31, 2020 December 31, 2019 Finance lease right of use assets Premises and equipment, net $ 5,406 $ 5,456 Finance lease liabilities Long-term borrowings 5,570 5,587 |
Schedule of Lease Cost, Term and Discount Rate | The following table shows the components of finance and operating lease expense for the three months ended March 31, 2020 and 2019: Three Months Ended March 31, (In Thousands) 2020 2019 Finance Lease Cost: Amortization of right-of-use asset $ 50 $ 65 Interest expense 53 56 Operating lease cost 91 88 Variable lease cost — 1 Total Lease Cost $ 194 $ 210 The following table shows the weighted average remaining lease term and weighted average discount rate for both operating and finance leases outstanding as of March 31, 2020 . Operating Finance Weighted-average term (years) 18.8 27.9 Weighted-average discount rate 3.51 % 3.77 % |
Schedule of Operating Lease Liabillity Maturities | A maturity analysis of operating and finance lease liabilities and reconciliation of the undiscounted cash flows to the total operating lease liability is as follows: (In Thousands) Operating Finance 2020 $ 215 $ 211 2021 291 282 2022 298 283 2023 273 284 2024 263 290 2025 and thereafter 3,176 8,004 Total undiscounted cash flows 4,516 9,354 Discount on cash flows (1,217 ) (3,784 ) Total lease liability $ 3,299 $ 5,570 |
Schedule of Finance Lease Liability Maturities | A maturity analysis of operating and finance lease liabilities and reconciliation of the undiscounted cash flows to the total operating lease liability is as follows: (In Thousands) Operating Finance 2020 $ 215 $ 211 2021 291 282 2022 298 283 2023 273 284 2024 263 290 2025 and thereafter 3,176 8,004 Total undiscounted cash flows 4,516 9,354 Discount on cash flows (1,217 ) (3,784 ) Total lease liability $ 3,299 $ 5,570 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Gain (Loss) - Schedule of AOCI (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | $ 154,982 | $ 143,544 |
Other comprehensive gain before reclassifications | 548 | 1,567 |
Amounts reclassified from accumulated other comprehensive (loss) gain | 16 | 27 |
Total other comprehensive gain income | 564 | 1,594 |
Ending balance | 156,588 | 147,036 |
Net Unrealized Gain (Loss) on Available for Sale Securities | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | 2,455 | (1,360) |
Other comprehensive gain before reclassifications | 548 | 1,567 |
Amounts reclassified from accumulated other comprehensive (loss) gain | (17) | (10) |
Total other comprehensive gain income | 531 | 1,557 |
Ending balance | 2,986 | 197 |
Defined Benefit Plan | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (5,232) | (5,276) |
Other comprehensive gain before reclassifications | 0 | 0 |
Amounts reclassified from accumulated other comprehensive (loss) gain | 33 | 37 |
Total other comprehensive gain income | 33 | 37 |
Ending balance | (5,199) | (5,239) |
AOCI Attributable to Parent | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (2,777) | (6,636) |
Total other comprehensive gain income | 564 | 1,594 |
Ending balance | $ (2,213) | $ (5,042) |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Gain (Loss) - Schedule of Reclassifications out of AOCI (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Reclassifications out of accumulated other comprehensive income | ||
Net unrealized gain on available for sale securities | $ 21 | $ 13 |
Income tax effect | (661) | (812) |
Net unrecognized pension costs | (5,667) | (5,501) |
Net Income | 3,073 | 3,944 |
Amount Reclassified from Accumulated Other Comprehensive Loss | Net unrealized gain on available for sale securities | ||
Reclassifications out of accumulated other comprehensive income | ||
Net unrealized gain on available for sale securities | 21 | 13 |
Income tax effect | (4) | (3) |
Net Income | 17 | 10 |
Amount Reclassified from Accumulated Other Comprehensive Loss | Defined Benefit Plan | ||
Reclassifications out of accumulated other comprehensive income | ||
Income tax effect | 8 | 10 |
Net unrecognized pension costs | (41) | (47) |
Net Income | $ (33) | $ (37) |
Per Share Data - Narrative (Det
Per Share Data - Narrative (Details) - $ / shares | 3 Months Ended | |||||
Mar. 31, 2020 | Jan. 01, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Aug. 27, 2015 | |
Earnings Per Share [Abstract] | ||||||
Convertible securities which would affect denominator in calculating basic and dilutive earnings per share (in shares) | 0 | |||||
Options, outstanding (in shares) | 864,300 | 635,550 | 625,800 | 635,550 | 395,550 | 35,250 |
Outstanding, weighted average exercise price (in dollars per share) | $ 28.20 | $ 29.29 | $ 29.29 | $ 30.08 | ||
Share price (in dollars per share) | $ 29.57 | $ 26.91 |
Per Share Data - Composition of
Per Share Data - Composition of Weighted Average Common Shares Used in Earnings per Share Computation (Details) - shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Earnings Per Share [Abstract] | ||
Weighted average common shares issued (in shares) | 7,520,965 | 7,517,853 |
Weighted average treasury stock shares (in shares) | (480,225) | (480,225) |
Weighted average shares outstanding - basic (in shares) | 7,040,740 | 7,037,628 |
Dilutive effect of outstanding stock options (in shares) | 62,250 | 0 |
Weighted average common shares outstanding - basic and diluted (in shares) | 7,102,990 | 7,037,628 |
Investment Securities - Amortiz
Investment Securities - Amortized Cost and Fair Values of Investment Securities Available for Sale (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Available for sale (AFS): | ||
Total | $ 151,742 | |
Fair value | 155,522 | $ 148,619 |
Investment equity securities: | ||
Fair value | 1,281 | 1,261 |
Trading: | ||
Fair value | 37 | 51 |
Mortgage-backed securities | ||
Available for sale (AFS): | ||
Total | 4,874 | 4,956 |
Gross unrealized gains | 125 | 56 |
Gross unrealized losses | 0 | (46) |
Fair value | 4,999 | 4,966 |
State and political securities | ||
Available for sale (AFS): | ||
Total | 87,545 | 79,064 |
Gross unrealized gains | 4,574 | 3,299 |
Gross unrealized losses | (79) | (77) |
Fair value | 92,040 | 82,286 |
Other debt securities | ||
Available for sale (AFS): | ||
Total | 59,323 | 61,492 |
Gross unrealized gains | 543 | 401 |
Gross unrealized losses | (1,383) | (526) |
Fair value | 58,483 | 61,367 |
Total debt securities | ||
Available for sale (AFS): | ||
Total | 151,742 | 145,512 |
Gross unrealized gains | 5,242 | 3,756 |
Gross unrealized losses | (1,462) | (649) |
Fair value | 155,522 | 148,619 |
Other equity securities | ||
Investment equity securities: | ||
Amortized cost - total | 1,300 | 1,300 |
Gross unrealized gains | 7 | 0 |
Gross unrealized losses | (26) | (39) |
Fair value | 1,281 | 1,261 |
Trading: | ||
Amortized cost - total | 50 | 50 |
Gross unrealized gains | 0 | 3 |
Gross unrealized losses | (13) | (2) |
Fair value | $ 37 | $ 51 |
Investment Securities - Gross U
Investment Securities - Gross Unrealized Losses and Fair Value by Investment Category (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Mortgage-backed securities | ||
Investment securities | ||
Fair value, less than twelve months | $ 0 | $ 0 |
Gross unrealized losses, less than twelve months | 0 | 0 |
Fair value, twelve months or greater | 0 | 2,115 |
Gross unrealized losses, twelve months or greater | 0 | (46) |
Fair value, total | 0 | 2,115 |
Gross unrealized losses, total | 0 | (46) |
State and political securities | ||
Investment securities | ||
Fair value, less than twelve months | 5,887 | 7,958 |
Gross unrealized losses, less than twelve months | (61) | (40) |
Fair value, twelve months or greater | 242 | 224 |
Gross unrealized losses, twelve months or greater | (18) | (37) |
Fair value, total | 6,129 | 8,182 |
Gross unrealized losses, total | (79) | (77) |
Other debt securities | ||
Investment securities | ||
Fair value, less than twelve months | 21,691 | 13,373 |
Gross unrealized losses, less than twelve months | (1,068) | (216) |
Fair value, twelve months or greater | 11,185 | 14,258 |
Gross unrealized losses, twelve months or greater | (315) | (310) |
Fair value, total | 32,876 | 27,631 |
Gross unrealized losses, total | (1,383) | (526) |
Total debt securities | ||
Investment securities | ||
Fair value, less than twelve months | 27,578 | 21,331 |
Gross unrealized losses, less than twelve months | (1,129) | (256) |
Fair value, twelve months or greater | 11,427 | 16,597 |
Gross unrealized losses, twelve months or greater | (333) | (393) |
Fair value, total | 39,005 | 37,928 |
Gross unrealized losses, total | $ (1,462) | $ (649) |
Investment Securities - Narrati
Investment Securities - Narrative (Details) | 3 Months Ended | ||
Mar. 31, 2020USD ($)security | Mar. 31, 2019USD ($) | Dec. 31, 2019USD ($) | |
Investments, Debt and Equity Securities [Abstract] | |||
Number of individual securities that were in a continuous unrealized loss position for less than twelve months (in securities) | security | 24 | ||
Number of individual securities that were in a continuous unrealized loss position for greater than twelve months (in securities) | security | 9 | ||
Gross proceeds from sales of securities | $ 2,774,000 | $ 6,986,000 | |
Impairment charges | 0 | $ 0 | |
Carrying value of investment securities pledged | 87,695,000 | $ 74,163,000 | |
Fair value | $ 1,281,000 | $ 1,261,000 |
Investment Securities - Amort_2
Investment Securities - Amortized Cost and Fair Value of Debt Securities (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Amortized Cost | |
Due in one year or less | $ 5,642 |
Due after one year to five years | 55,063 |
Due after five years to ten years | 67,078 |
Due after ten years | 23,959 |
Total | 151,742 |
Fair Value | |
Due in one year or less | 5,657 |
Due after one year to five years | 55,073 |
Due after five years to ten years | 70,403 |
Due after ten years | 24,389 |
Total | $ 155,522 |
Investment Securities - Total G
Investment Securities - Total Gross Proceeds from Sales of Securities (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Available for sale (AFS): | ||
Available-for-sale securities, gross realized gains | $ 21 | $ 19 |
Available-for-sale securities, gross realized losses | 0 | 6 |
State and political securities | ||
Available for sale (AFS): | ||
Available-for-sale securities, gross realized gains | 1 | 15 |
Available-for-sale securities, gross realized losses | 0 | 2 |
Other debt securities | ||
Available for sale (AFS): | ||
Available-for-sale securities, gross realized gains | 20 | 4 |
Available-for-sale securities, gross realized losses | $ 0 | $ 4 |
Investment Securities - Unreali
Investment Securities - Unrealized and Realized Gains and Losses Recognized in Net Income (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Equity Securities, FV-NI, Gain (Loss) [Abstract] | ||
Net (losses) gains recognized in equity securities during the period | $ 20 | $ 43 |
Less: Net gains realized on the sale of equity securities during the period | 0 | 0 |
Unrealized (losses) gains recognized in equity securities held at reporting date | 20 | 43 |
Debt Securities, Trading, Gain (Loss) [Abstract] | ||
Net gains on sale transactions | 0 | 5 |
Net mark-to-market (losses) gains | (14) | 5 |
Net (loss) gain on trading account securities | $ (14) | $ 10 |
Loans - Narrative (Details)
Loans - Narrative (Details) | 3 Months Ended | ||
Mar. 31, 2020USD ($)categoryclasscontractcomponent | Mar. 31, 2019contract | Dec. 31, 2019USD ($) | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Financing receivable individually evaluated for impairment minimum amount | $ 100,000 | ||
Individually evaluated for impairment | $ 100,000 | ||
Payment delays limit (in days) | 90 days | ||
Impaired financing receivable commitment to lend | $ 4,000 | ||
Period to classify TDR non performing loans to performing (in months) | 6 months | ||
Number of loan modifications | contract | 0 | 0 | |
Number of TDRs that defaulted | contract | 3 | ||
Recorded investment | $ 12,885,000 | $ 13,282,000 | |
Real estate acquired through foreclosure | 393,000 | 493,000 | |
Mortgage loans in process of foreclosure, amount | $ 421,000 | $ 32,000 | |
Number of categories considered not criticized and rated as, Pass | category | 6 | ||
Minimum period after which loans are considered as substandard (in days) | 90 days | ||
Number of components that represents the allowance for loan losses | component | 2 | ||
Number of classes that groups of loans are collectively evaluated for impairment | class | 2 | ||
Real Estate | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Number of categories in which real estate loans segmented | category | 3 | ||
Jersey Shore State Bank | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Amount after which external annual loan review of commercial relationships performed, minimum | $ 1,750,000 | ||
Luzerne National Bank Corporation | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Amount after which external annual loan review of commercial relationships performed, minimum | $ 1,500,000 | ||
Commercial, financial, and agricultural | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Number of TDRs that defaulted | contract | 2 | ||
Troubled debt restructuring, default amount | $ 1,112,000 | ||
Commercial | Real Estate Mortgages | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Number of TDRs that defaulted | contract | 1 | ||
Troubled debt restructuring, default amount | $ 1,040,000 | ||
COVID-19 Modifications | Rate modification | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Number of loan modifications | contract | 23 | ||
Recorded investment | $ 2,476,000 | ||
COVID-19 Modifications | Payment deferral | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Number of loan modifications | contract | 36 | ||
Recorded investment | $ 4,044,000 |
Loans - Aging Categories of Loa
Loans - Aging Categories of Loans by Segment (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
Aging categories of loans by segment | ||||
Current | $ 1,325,684 | $ 1,334,612 | ||
Past due 30 to 89 days | 11,057 | 7,324 | ||
Past due 90 days or more & still accruing | 1,503 | 2,047 | ||
Non-accrual | 9,797 | 10,374 | ||
Total | 1,348,041 | 1,354,357 | ||
Net deferred loan fees and discounts | 1,359 | 1,187 | ||
Allowance for loan losses | (12,500) | (11,894) | $ (13,792) | $ (13,837) |
Current loans, net | 1,314,543 | 1,323,905 | ||
Loans, net | 1,336,900 | 1,343,650 | ||
Commercial, financial, and agricultural | ||||
Aging categories of loans by segment | ||||
Current | 155,692 | 153,737 | ||
Past due 30 to 89 days | 489 | 249 | ||
Past due 90 days or more & still accruing | 31 | 30 | ||
Non-accrual | 1,938 | 2,197 | ||
Total | 158,150 | 156,213 | ||
Allowance for loan losses | (1,897) | (1,779) | (1,732) | (1,680) |
Real Estate Mortgages | Residential | ||||
Aging categories of loans by segment | ||||
Current | 607,445 | 615,580 | ||
Past due 30 to 89 days | 6,321 | 4,881 | ||
Past due 90 days or more & still accruing | 1,383 | 1,529 | ||
Non-accrual | 1,005 | 1,266 | ||
Total | 616,154 | 623,256 | ||
Allowance for loan losses | (4,537) | (4,306) | (5,730) | (5,616) |
Real Estate Mortgages | Commercial | ||||
Aging categories of loans by segment | ||||
Current | 351,202 | 355,597 | ||
Past due 30 to 89 days | 2,795 | 775 | ||
Past due 90 days or more & still accruing | 0 | 164 | ||
Non-accrual | 6,740 | 6,725 | ||
Total | 360,737 | 363,261 | ||
Allowance for loan losses | (3,414) | (3,210) | (3,802) | (4,047) |
Real Estate Mortgages | Construction | ||||
Aging categories of loans by segment | ||||
Current | 39,003 | 37,871 | ||
Past due 30 to 89 days | 230 | 131 | ||
Past due 90 days or more & still accruing | 0 | 0 | ||
Non-accrual | 64 | 65 | ||
Total | 39,297 | 38,067 | ||
Allowance for loan losses | (160) | (118) | (130) | (143) |
Consumer automobile loans | ||||
Aging categories of loans by segment | ||||
Current | 150,891 | 149,703 | ||
Past due 30 to 89 days | 700 | 709 | ||
Past due 90 days or more & still accruing | 74 | 0 | ||
Non-accrual | 50 | 105 | ||
Total | 151,715 | 150,517 | ||
Allowance for loan losses | (1,855) | (1,780) | (1,402) | (1,328) |
Other consumer installment loans | ||||
Aging categories of loans by segment | ||||
Current | 21,451 | 22,124 | ||
Past due 30 to 89 days | 522 | 579 | ||
Past due 90 days or more & still accruing | 15 | 324 | ||
Non-accrual | 0 | 16 | ||
Total | 21,988 | 23,043 | ||
Allowance for loan losses | $ (267) | $ (278) | $ (278) | $ (259) |
Loans - Interest Income (Detail
Loans - Interest Income (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Interest Income That Would Have Been Recorded Based on Original Term and Rate | $ 62 | $ 150 |
Interest Income Recorded on a Cash Basis | 0 | 104 |
Commercial, financial, and agricultural | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Interest Income That Would Have Been Recorded Based on Original Term and Rate | 9 | 24 |
Interest Income Recorded on a Cash Basis | 0 | 39 |
Real Estate Mortgages | Residential | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Interest Income That Would Have Been Recorded Based on Original Term and Rate | 9 | 33 |
Interest Income Recorded on a Cash Basis | 0 | 23 |
Real Estate Mortgages | Commercial | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Interest Income That Would Have Been Recorded Based on Original Term and Rate | 42 | 89 |
Interest Income Recorded on a Cash Basis | 0 | 40 |
Real Estate Mortgages | Construction | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Interest Income That Would Have Been Recorded Based on Original Term and Rate | 0 | 1 |
Interest Income Recorded on a Cash Basis | 0 | 1 |
Consumer automobile loans | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Interest Income That Would Have Been Recorded Based on Original Term and Rate | 2 | 2 |
Interest Income Recorded on a Cash Basis | 0 | 1 |
Other consumer installment loans | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Interest Income That Would Have Been Recorded Based on Original Term and Rate | 0 | 1 |
Interest Income Recorded on a Cash Basis | $ 0 | $ 0 |
Loans - Recorded Investment, Un
Loans - Recorded Investment, Unpaid Principal Balance, Related Allowance of Impaired Loans (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Credit Quality and Related Allowance for Loan Losses | ||
Recorded investment, with no related allowance recorded | $ 11,731 | $ 12,393 |
Recorded investment, with an allowance recorded | 4,671 | 4,854 |
Recorded investment | 16,402 | 17,247 |
Unpaid principal balance, with no related allowance recorded | 14,518 | 15,180 |
Unpaid principal balance, with an allowance recorded | 4,721 | 4,936 |
Unpaid principal balance | 19,239 | 20,116 |
Related allowance | 1,244 | 1,393 |
Commercial, financial, and agricultural | ||
Credit Quality and Related Allowance for Loan Losses | ||
Recorded investment, with no related allowance recorded | 1,921 | 2,285 |
Recorded investment, with an allowance recorded | 104 | 0 |
Recorded investment | 2,025 | 2,285 |
Unpaid principal balance, with no related allowance recorded | 4,708 | 5,072 |
Unpaid principal balance, with an allowance recorded | 104 | 0 |
Unpaid principal balance | 4,812 | 5,072 |
Related allowance | 0 | 0 |
Real Estate Mortgages | Residential | ||
Credit Quality and Related Allowance for Loan Losses | ||
Recorded investment, with no related allowance recorded | 4,656 | 5,008 |
Recorded investment, with an allowance recorded | 1,074 | 1,168 |
Recorded investment | 5,730 | 6,176 |
Unpaid principal balance, with no related allowance recorded | 4,656 | 5,008 |
Unpaid principal balance, with an allowance recorded | 1,074 | 1,200 |
Unpaid principal balance | 5,730 | 6,208 |
Related allowance | 177 | 211 |
Real Estate Mortgages | Commercial | ||
Credit Quality and Related Allowance for Loan Losses | ||
Recorded investment, with no related allowance recorded | 5,089 | 5,035 |
Recorded investment, with an allowance recorded | 3,472 | 3,540 |
Recorded investment | 8,561 | 8,575 |
Unpaid principal balance, with no related allowance recorded | 5,089 | 5,035 |
Unpaid principal balance, with an allowance recorded | 3,522 | 3,590 |
Unpaid principal balance | 8,611 | 8,625 |
Related allowance | 1,062 | 1,104 |
Real Estate Mortgages | Construction | ||
Credit Quality and Related Allowance for Loan Losses | ||
Recorded investment, with no related allowance recorded | 65 | 65 |
Recorded investment, with an allowance recorded | 0 | 0 |
Recorded investment | 65 | 65 |
Unpaid principal balance, with no related allowance recorded | 65 | 65 |
Unpaid principal balance, with an allowance recorded | 0 | 0 |
Unpaid principal balance | 65 | 65 |
Related allowance | 0 | 0 |
Consumer automobile loans | ||
Credit Quality and Related Allowance for Loan Losses | ||
Recorded investment, with no related allowance recorded | 0 | 0 |
Recorded investment, with an allowance recorded | 21 | 130 |
Recorded investment | 21 | 130 |
Unpaid principal balance, with no related allowance recorded | 0 | 0 |
Unpaid principal balance, with an allowance recorded | 21 | 130 |
Unpaid principal balance | 21 | 130 |
Related allowance | 5 | 62 |
Installment loans to individuals | ||
Credit Quality and Related Allowance for Loan Losses | ||
Recorded investment, with no related allowance recorded | 0 | 0 |
Recorded investment, with an allowance recorded | 0 | 16 |
Recorded investment | 0 | 16 |
Unpaid principal balance, with no related allowance recorded | 0 | 0 |
Unpaid principal balance, with an allowance recorded | 0 | 16 |
Unpaid principal balance | 0 | 16 |
Related allowance | $ 0 | $ 16 |
Loans - Average Recorded Invest
Loans - Average Recorded Investment - Impaired Loans (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Credit Quality and Related Allowance for Loan Losses | ||
Average Investment in Impaired Loans | $ 16,825 | $ 20,677 |
Interest Income Recognized on an Accrual Basis on Impaired Loans | 84 | 60 |
Interest Income Recognized on a Cash Basis on Impaired Loans | 0 | 93 |
Commercial, financial, and agricultural | ||
Credit Quality and Related Allowance for Loan Losses | ||
Average Investment in Impaired Loans | 2,155 | 5,302 |
Interest Income Recognized on an Accrual Basis on Impaired Loans | 1 | 1 |
Interest Income Recognized on a Cash Basis on Impaired Loans | 0 | 38 |
Real Estate Mortgages | Residential | ||
Credit Quality and Related Allowance for Loan Losses | ||
Average Investment in Impaired Loans | 5,953 | 4,163 |
Interest Income Recognized on an Accrual Basis on Impaired Loans | 57 | 28 |
Interest Income Recognized on a Cash Basis on Impaired Loans | 0 | 17 |
Real Estate Mortgages | Commercial | ||
Credit Quality and Related Allowance for Loan Losses | ||
Average Investment in Impaired Loans | 8,568 | 11,069 |
Interest Income Recognized on an Accrual Basis on Impaired Loans | 26 | 31 |
Interest Income Recognized on a Cash Basis on Impaired Loans | 0 | 36 |
Real Estate Mortgages | Construction | ||
Credit Quality and Related Allowance for Loan Losses | ||
Average Investment in Impaired Loans | 65 | 73 |
Interest Income Recognized on an Accrual Basis on Impaired Loans | 0 | 0 |
Interest Income Recognized on a Cash Basis on Impaired Loans | 0 | 1 |
Consumer automobile loans | ||
Credit Quality and Related Allowance for Loan Losses | ||
Average Investment in Impaired Loans | 76 | 52 |
Interest Income Recognized on an Accrual Basis on Impaired Loans | 0 | 0 |
Interest Income Recognized on a Cash Basis on Impaired Loans | 0 | 1 |
Other consumer installment loans | ||
Credit Quality and Related Allowance for Loan Losses | ||
Average Investment in Impaired Loans | 8 | 18 |
Interest Income Recognized on an Accrual Basis on Impaired Loans | 0 | 0 |
Interest Income Recognized on a Cash Basis on Impaired Loans | $ 0 | $ 0 |
Loans - Credit Quality Indicato
Loans - Credit Quality Indicators (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Credit quality categories | ||
Total | $ 1,348,041 | $ 1,354,357 |
Pass | ||
Credit quality categories | ||
Total | 1,322,930 | 1,328,050 |
Special Mention | ||
Credit quality categories | ||
Total | 10,588 | 10,690 |
Substandard | ||
Credit quality categories | ||
Total | 14,523 | 15,617 |
Commercial, financial, and agricultural | ||
Credit quality categories | ||
Total | 158,150 | 156,213 |
Commercial, financial, and agricultural | Pass | ||
Credit quality categories | ||
Total | 151,756 | 149,349 |
Commercial, financial, and agricultural | Special Mention | ||
Credit quality categories | ||
Total | 3,154 | 3,174 |
Commercial, financial, and agricultural | Substandard | ||
Credit quality categories | ||
Total | 3,240 | 3,690 |
Consumer automobile | ||
Credit quality categories | ||
Total | 151,715 | 150,517 |
Consumer automobile | Pass | ||
Credit quality categories | ||
Total | 151,715 | 150,517 |
Consumer automobile | Special Mention | ||
Credit quality categories | ||
Total | 0 | 0 |
Consumer automobile | Substandard | ||
Credit quality categories | ||
Total | 0 | 0 |
Other consumer installment loans | ||
Credit quality categories | ||
Total | 21,988 | 23,043 |
Other consumer installment loans | Pass | ||
Credit quality categories | ||
Total | 21,985 | 23,039 |
Other consumer installment loans | Special Mention | ||
Credit quality categories | ||
Total | 0 | 0 |
Other consumer installment loans | Substandard | ||
Credit quality categories | ||
Total | 3 | 4 |
Residential | Real Estate Mortgages | ||
Credit quality categories | ||
Total | 616,154 | 623,256 |
Residential | Real Estate Mortgages | Pass | ||
Credit quality categories | ||
Total | 611,584 | 618,350 |
Residential | Real Estate Mortgages | Special Mention | ||
Credit quality categories | ||
Total | 2,416 | 2,436 |
Residential | Real Estate Mortgages | Substandard | ||
Credit quality categories | ||
Total | 2,154 | 2,470 |
Commercial | Real Estate Mortgages | ||
Credit quality categories | ||
Total | 360,737 | 363,261 |
Commercial | Real Estate Mortgages | Pass | ||
Credit quality categories | ||
Total | 346,727 | 348,864 |
Commercial | Real Estate Mortgages | Special Mention | ||
Credit quality categories | ||
Total | 5,018 | 5,080 |
Commercial | Real Estate Mortgages | Substandard | ||
Credit quality categories | ||
Total | 8,992 | 9,317 |
Construction | Real Estate Mortgages | ||
Credit quality categories | ||
Total | 39,297 | 38,067 |
Construction | Real Estate Mortgages | Pass | ||
Credit quality categories | ||
Total | 39,163 | 37,931 |
Construction | Real Estate Mortgages | Special Mention | ||
Credit quality categories | ||
Total | 0 | 0 |
Construction | Real Estate Mortgages | Substandard | ||
Credit quality categories | ||
Total | $ 134 | $ 136 |
Loans - Allowance for Credit Lo
Loans - Allowance for Credit Losses on Financing Receivables (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Allowance for Loan Losses: | ||
Beginning Balance | $ 11,894 | $ 13,837 |
Charge-offs | (230) | (458) |
Recoveries | 86 | 53 |
Provision for loan losses | 750 | 360 |
Ending Balance | 12,500 | 13,792 |
Commercial, financial, and agricultural | ||
Allowance for Loan Losses: | ||
Beginning Balance | 1,779 | 1,680 |
Charge-offs | (14) | (50) |
Recoveries | 21 | 6 |
Provision for loan losses | 111 | 96 |
Ending Balance | 1,897 | 1,732 |
Real Estate Mortgages | Residential | ||
Allowance for Loan Losses: | ||
Beginning Balance | 4,306 | 5,616 |
Charge-offs | (41) | (73) |
Recoveries | 21 | 1 |
Provision for loan losses | 251 | 186 |
Ending Balance | 4,537 | 5,730 |
Real Estate Mortgages | Commercial | ||
Allowance for Loan Losses: | ||
Beginning Balance | 3,210 | 4,047 |
Charge-offs | 0 | (139) |
Recoveries | 0 | 0 |
Provision for loan losses | 204 | (106) |
Ending Balance | 3,414 | 3,802 |
Real Estate Mortgages | Construction | ||
Allowance for Loan Losses: | ||
Beginning Balance | 118 | 143 |
Charge-offs | 0 | 0 |
Recoveries | 2 | 5 |
Provision for loan losses | 40 | (18) |
Ending Balance | 160 | 130 |
Consumer automobile loans | ||
Allowance for Loan Losses: | ||
Beginning Balance | 1,780 | 1,328 |
Charge-offs | (75) | (100) |
Recoveries | 1 | 26 |
Provision for loan losses | 149 | 148 |
Ending Balance | 1,855 | 1,402 |
Other consumer installment loans | ||
Allowance for Loan Losses: | ||
Beginning Balance | 278 | 259 |
Charge-offs | (100) | (96) |
Recoveries | 41 | 15 |
Provision for loan losses | 48 | 100 |
Ending Balance | 267 | 278 |
Unallocated | ||
Allowance for Loan Losses: | ||
Beginning Balance | 423 | 764 |
Charge-offs | 0 | 0 |
Recoveries | 0 | 0 |
Provision for loan losses | (53) | (46) |
Ending Balance | $ 370 | $ 718 |
Loans - Schedule of Concentrati
Loans - Schedule of Concentration Risk (Details) - Owners of rental properties - Financing receivable | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Residential | ||
Concentration Risk [Line Items] | ||
Concentration of loans (as a percent) | 16.04% | 14.82% |
Commercial | ||
Concentration Risk [Line Items] | ||
Concentration of loans (as a percent) | 12.53% | 12.07% |
Loans - Allowance for Loan Loss
Loans - Allowance for Loan Losses (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
Ending allowance balance attributable to loans: | ||||
Individually evaluated for impairment | $ 1,244 | $ 1,393 | ||
Collectively evaluated for impairment | 11,256 | 10,501 | ||
Total ending allowance balance | 12,500 | 11,894 | $ 13,792 | $ 13,837 |
Loans: | ||||
Individually evaluated for impairment | 16,402 | 17,247 | ||
Collectively evaluated for impairment | 1,331,639 | 1,337,110 | ||
Total | 1,348,041 | 1,354,357 | ||
Commercial, financial, and agricultural | ||||
Ending allowance balance attributable to loans: | ||||
Individually evaluated for impairment | 0 | 0 | ||
Collectively evaluated for impairment | 1,897 | 1,779 | ||
Total ending allowance balance | 1,897 | 1,779 | 1,732 | 1,680 |
Loans: | ||||
Individually evaluated for impairment | 2,025 | 2,285 | ||
Collectively evaluated for impairment | 156,125 | 153,928 | ||
Total | 158,150 | 156,213 | ||
Real Estate Mortgages | Residential | ||||
Ending allowance balance attributable to loans: | ||||
Individually evaluated for impairment | 177 | 211 | ||
Collectively evaluated for impairment | 4,360 | 4,095 | ||
Total ending allowance balance | 4,537 | 4,306 | 5,730 | 5,616 |
Loans: | ||||
Individually evaluated for impairment | 5,730 | 6,176 | ||
Collectively evaluated for impairment | 610,424 | 617,080 | ||
Total | 616,154 | 623,256 | ||
Real Estate Mortgages | Commercial | ||||
Ending allowance balance attributable to loans: | ||||
Individually evaluated for impairment | 1,062 | 1,104 | ||
Collectively evaluated for impairment | 2,352 | 2,106 | ||
Total ending allowance balance | 3,414 | 3,210 | 3,802 | 4,047 |
Loans: | ||||
Individually evaluated for impairment | 8,561 | 8,575 | ||
Collectively evaluated for impairment | 352,176 | 354,686 | ||
Total | 360,737 | 363,261 | ||
Real Estate Mortgages | Construction | ||||
Ending allowance balance attributable to loans: | ||||
Individually evaluated for impairment | 0 | 0 | ||
Collectively evaluated for impairment | 160 | 118 | ||
Total ending allowance balance | 160 | 118 | 130 | 143 |
Loans: | ||||
Individually evaluated for impairment | 65 | 65 | ||
Collectively evaluated for impairment | 39,232 | 38,002 | ||
Total | 39,297 | 38,067 | ||
Consumer automobile loans | ||||
Ending allowance balance attributable to loans: | ||||
Individually evaluated for impairment | 5 | 62 | ||
Collectively evaluated for impairment | 1,850 | 1,718 | ||
Total ending allowance balance | 1,855 | 1,780 | 1,402 | 1,328 |
Loans: | ||||
Individually evaluated for impairment | 21 | 130 | ||
Collectively evaluated for impairment | 151,694 | 150,387 | ||
Total | 151,715 | 150,517 | ||
Other consumer installment loans | ||||
Ending allowance balance attributable to loans: | ||||
Individually evaluated for impairment | 0 | 16 | ||
Collectively evaluated for impairment | 267 | 262 | ||
Total ending allowance balance | 267 | 278 | 278 | 259 |
Loans: | ||||
Individually evaluated for impairment | 0 | 16 | ||
Collectively evaluated for impairment | 21,988 | 23,027 | ||
Total | 21,988 | 23,043 | ||
Unallocated | ||||
Ending allowance balance attributable to loans: | ||||
Individually evaluated for impairment | 0 | 0 | ||
Collectively evaluated for impairment | 370 | 423 | ||
Total ending allowance balance | $ 370 | $ 423 | $ 718 | $ 764 |
Net Periodic Benefit Cost-Def_3
Net Periodic Benefit Cost-Defined Benefit Plans (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Net periodic benefit cost of the domestic non-contributory defined benefit plan | |||
Interest cost | $ 160,000 | $ 191,000 | |
Expected return on plan assets | (318,000) | (249,000) | |
Amortization of net loss | 41,000 | 47,000 | |
Net periodic benefit | (117,000) | $ (11,000) | |
Expected contribution to Pension Plan (minimum) | $ 500,000 | ||
Employer contributions made to the defined benefit plan | 1,000,000 | ||
Anticipated additional contributions anticipated during the remainder of the year (at least) | $ 250,000 |
Employee Stock Purchase Plan (D
Employee Stock Purchase Plan (Details) - Employee Stock - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Employee Stock Purchase Plan | ||
Number of shares allowed to be purchased by employees (in shares) | 1,000,000 | |
Purchase price of the shares with respect to market value (as a percent) | 95.00% | |
Maximum percentage of base compensation | 15.00% | |
Maximum market value | $ 12,000 | |
Number of shares issued under the plan (in shares) | 751 | 863 |
Off Balance Sheet Risk (Details
Off Balance Sheet Risk (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Off Balance Sheet Risk | ||
Contract amounts representing credit risk | $ 208,743 | $ 204,242 |
Commitments to extend credit | ||
Off Balance Sheet Risk | ||
Contract amounts representing credit risk | 191,676 | 187,778 |
Standby letters of credit | ||
Off Balance Sheet Risk | ||
Contract amounts representing credit risk | $ 9,976 | 9,638 |
Coverage period for instrument (in years) | 1 year | |
Credit exposure from the sale of assets with recourse | ||
Off Balance Sheet Risk | ||
Contract amounts representing credit risk | $ 7,091 | $ 6,826 |
Fair Value Measurements - Recur
Fair Value Measurements - Recurring Assets (Details) - Recurring - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Mortgage-backed securities | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | $ 4,999 | $ 4,966 |
State and political securities | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 92,040 | 82,286 |
Other debt securities | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 58,483 | 61,367 |
Other equity securities - Available for sales | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 1,281 | 1,261 |
Other equity securities - Trading | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 37 | 51 |
Level I | Mortgage-backed securities | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 0 | 0 |
Level I | State and political securities | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 0 | 0 |
Level I | Other debt securities | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 0 | 0 |
Level I | Other equity securities - Available for sales | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 1,281 | 1,261 |
Level I | Other equity securities - Trading | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 37 | 51 |
Level II | Mortgage-backed securities | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 4,999 | 4,966 |
Level II | State and political securities | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 92,040 | 82,286 |
Level II | Other debt securities | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 58,483 | 61,367 |
Level II | Other equity securities - Available for sales | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 0 | 0 |
Level II | Other equity securities - Trading | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 0 | 0 |
Level III | Mortgage-backed securities | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 0 | 0 |
Level III | State and political securities | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 0 | 0 |
Level III | Other debt securities | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 0 | 0 |
Level III | Other equity securities - Available for sales | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 0 | 0 |
Level III | Other equity securities - Trading | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | $ 0 | $ 0 |
Fair Value Measurements - Non-R
Fair Value Measurements - Non-Recurring Assets (Details) - Nonrecurring - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Impaired loans | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | $ 15,158 | $ 15,854 |
Impaired loans | Level I | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 0 | 0 |
Impaired loans | Level II | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 0 | 0 |
Impaired loans | Level III | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 15,158 | 15,854 |
Other real estate owned | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 308 | 413 |
Other real estate owned | Level I | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 0 | 0 |
Other real estate owned | Level II | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | 0 | 0 |
Other real estate owned | Level III | ||
Fair Value Measurements [Abstract] | ||
Total assets, fair value | $ 308 | $ 413 |
Fair Value Measurements - Signi
Fair Value Measurements - Significant Unobservable Inputs (Details) - Nonrecurring $ in Thousands | Mar. 31, 2020USD ($) | Dec. 31, 2019USD ($) |
Level III | Measurement Input, Default Rate | Discounted cash flow | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Impaired loans measurement input | 0 | |
Level III | Measurement Input, Temporary Reduction In Payment | Discounted cash flow | Minimum | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Impaired loans, measurement input percentage | 0.17 | 0.17 |
Level III | Measurement Input, Temporary Reduction In Payment | Discounted cash flow | Maximum | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Impaired loans, measurement input percentage | (0.59) | (0.59) |
Level III | Measurement Input, Temporary Reduction In Payment | Discounted cash flow | Weighted Average | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Impaired loans, measurement input percentage | (0.24) | (0.24) |
Level III | Measurement Input, Appraised Value | Appraisal of collateral | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Other real estate owned, measurement input percentage | (0.20) | (0.20) |
Level III | Measurement Input, Appraised Value | Appraisal of collateral | Minimum | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Impaired loans, measurement input percentage | 0 | 0 |
Level III | Measurement Input, Appraised Value | Appraisal of collateral | Maximum | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Impaired loans, measurement input percentage | (0.80) | (0.30) |
Level III | Measurement Input, Appraised Value | Appraisal of collateral | Weighted Average | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Impaired loans, measurement input percentage | (0.10) | (0.09) |
Other real estate owned, measurement input percentage | (0.20) | (0.20) |
Impaired loans | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Total assets, fair value | $ 15,158 | $ 15,854 |
Impaired loans | Level III | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Total assets, fair value | 15,158 | 15,854 |
Impaired loans | Level III | Discounted cash flow | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Total assets, fair value | 6,891 | 6,950 |
Impaired loans | Level III | Appraisal of collateral | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Total assets, fair value | 8,267 | 8,904 |
Other real estate owned | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Total assets, fair value | 308 | 413 |
Other real estate owned | Level III | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Total assets, fair value | 308 | 413 |
Other real estate owned | Level III | Appraisal of collateral | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Total assets, fair value | $ 308 | $ 413 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Financial assets: | ||
Restricted investment in bank stock, at fair value | $ 14,611 | $ 13,528 |
Bank-owned life insurance | 29,228 | 29,253 |
Accrued interest receivable | 5,307 | 5,246 |
Financial liabilities: | ||
Interest-bearing deposits | 993,975 | 989,259 |
Noninterest-bearing deposits | 332,759 | 334,746 |
Level I | ||
Financial assets: | ||
Cash and cash equivalents | 77,761 | 48,589 |
Restricted investment in bank stock, at fair value | 14,611 | 13,528 |
Loans held for sale | 4,294 | 4,232 |
Loans, net | 0 | 0 |
Bank-owned life insurance | 29,228 | 29,253 |
Accrued interest receivable | 5,307 | 5,246 |
Financial liabilities: | ||
Interest-bearing deposits | 618,680 | 611,374 |
Noninterest-bearing deposits | 332,759 | 334,746 |
Short-term borrowings | 17,741 | 4,920 |
Long-term borrowings | 0 | 0 |
Accrued interest payable | 1,635 | 1,671 |
Level II | ||
Financial assets: | ||
Cash and cash equivalents | 0 | 0 |
Restricted investment in bank stock, at fair value | 0 | 0 |
Loans held for sale | 0 | 0 |
Loans, net | 0 | 0 |
Bank-owned life insurance | 0 | 0 |
Accrued interest receivable | 0 | 0 |
Financial liabilities: | ||
Interest-bearing deposits | 0 | 0 |
Noninterest-bearing deposits | 0 | 0 |
Short-term borrowings | 0 | 0 |
Long-term borrowings | 0 | 0 |
Accrued interest payable | 0 | 0 |
Level III | ||
Financial assets: | ||
Cash and cash equivalents | 0 | 0 |
Restricted investment in bank stock, at fair value | 0 | 0 |
Loans held for sale | 0 | 0 |
Loans, net | 1,325,148 | 1,346,395 |
Bank-owned life insurance | 0 | 0 |
Accrued interest receivable | 0 | 0 |
Financial liabilities: | ||
Interest-bearing deposits | 380,899 | 379,373 |
Noninterest-bearing deposits | 0 | 0 |
Short-term borrowings | 0 | 0 |
Long-term borrowings | 176,801 | 163,931 |
Accrued interest payable | 0 | 0 |
Carrying Value | ||
Financial assets: | ||
Cash and cash equivalents | 77,761 | 48,589 |
Restricted investment in bank stock, at fair value | 14,611 | 13,528 |
Loans held for sale | 4,294 | 4,232 |
Loans, net | 1,336,900 | 1,343,650 |
Bank-owned life insurance | 29,228 | 29,253 |
Accrued interest receivable | 5,307 | 5,246 |
Financial liabilities: | ||
Interest-bearing deposits | 993,975 | 989,259 |
Noninterest-bearing deposits | 332,759 | 334,746 |
Short-term borrowings | 17,741 | 4,920 |
Long-term borrowings | 171,903 | 161,920 |
Accrued interest payable | 1,635 | 1,671 |
Fair Value | ||
Financial assets: | ||
Cash and cash equivalents | 77,761 | 48,589 |
Restricted investment in bank stock, at fair value | 14,611 | 13,528 |
Loans held for sale | 4,294 | 4,232 |
Loans, net | 1,325,148 | 1,346,395 |
Bank-owned life insurance | 29,228 | 29,253 |
Accrued interest receivable | 5,307 | 5,246 |
Financial liabilities: | ||
Interest-bearing deposits | 999,579 | 990,747 |
Noninterest-bearing deposits | 332,759 | 334,746 |
Short-term borrowings | 17,741 | 4,920 |
Long-term borrowings | 176,801 | 163,931 |
Accrued interest payable | $ 1,635 | $ 1,671 |
Stock Options - Narrative (Deta
Stock Options - Narrative (Details) - USD ($) | Mar. 11, 2020 | Mar. 15, 2019 | Aug. 24, 2018 | Jan. 05, 2018 | Mar. 24, 2017 | Aug. 27, 2015 | Mar. 31, 2020 | Mar. 31, 2019 | Jan. 01, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Employee Stock Purchase Plan | |||||||||||
Options, outstanding (in shares) | 35,250 | 864,300 | 635,550 | 635,550 | 625,800 | 395,550 | |||||
Granted (in shares) | 58,125 | 238,500 | 240,000 | ||||||||
Granted (in dollars per share) | $ 28.02 | $ 25.34 | $ 28.01 | ||||||||
Exercisable period (in years) | 5 years | ||||||||||
Expiration (in years) | 10 years | ||||||||||
Employee Stock Option | |||||||||||
Employee Stock Purchase Plan | |||||||||||
Expiration (in years) | 10 years | ||||||||||
Compensation expense | $ 198,000 | $ 136,000 | |||||||||
Number of exercisable options (in shares) | 62,625 | ||||||||||
Weighted average remaining contractual term (in years) | 8 years 8 months 1 day | ||||||||||
Fair value of options granted | $ 1,343,000 | ||||||||||
Fair value of options granted (in dollars per share) | $ 5.63 | ||||||||||
Unrecognized compensation cost for non-vested shares | $ 2,642,000 | ||||||||||
Period for recognition (in years) | 1 year 7 months 28 days | ||||||||||
Tranche One | |||||||||||
Employee Stock Purchase Plan | |||||||||||
Options, outstanding (in shares) | 119,300 | 118,950 | 73,350 | 18,750 | 62,625 | ||||||
Granted (in shares) | 119,300 | 120,900 | 75,300 | 18,750 | 69,375 | 119,300 | |||||
Granted (in dollars per share) | $ 25.34 | $ 28.01 | $ 30.67 | $ 30.07 | $ 29.47 | ||||||
Exercisable period (in years) | 3 years | 3 years | 3 years | 3 years | 3 years | ||||||
Expiration (in years) | 10 years | 10 years | 10 years | 10 years | 10 years | ||||||
Tranche One | Employee Stock Option | |||||||||||
Employee Stock Purchase Plan | |||||||||||
Exercisable period (in years) | 3 years | ||||||||||
Tranche Two | |||||||||||
Employee Stock Purchase Plan | |||||||||||
Options, outstanding (in shares) | 119,200 | 117,300 | 145,200 | 18,750 | 35,625 | ||||||
Granted (in shares) | 119,200 | 119,100 | 149,250 | 18,750 | 35,625 | 119,200 | |||||
Granted (in dollars per share) | $ 25.34 | $ 28.01 | $ 30.67 | $ 30.07 | $ 29.47 | ||||||
Exercisable period (in years) | 5 years | 5 years | 5 years | 5 years | 5 years | ||||||
Expiration (in years) | 10 years | 10 years | 10 years | 10 years | 10 years | ||||||
Tranche Two | Employee Stock Option | |||||||||||
Employee Stock Purchase Plan | |||||||||||
Exercisable period (in years) | 5 years |
Stock Options - Schedule of Sto
Stock Options - Schedule of Stock Options Granted (Details) - $ / shares | Mar. 11, 2020 | Mar. 15, 2019 | Aug. 24, 2018 | Jan. 05, 2018 | Mar. 24, 2017 | Aug. 27, 2015 | Mar. 31, 2020 | Mar. 31, 2019 | Jan. 01, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Employee Stock Purchase Plan | |||||||||||
Shares (in shares) | 58,125 | 238,500 | 240,000 | ||||||||
Forfeited (in shares) | (22,875) | 0 | 0 | ||||||||
Outstanding (in shares) | 35,250 | 864,300 | 635,550 | 635,550 | 625,800 | 395,550 | |||||
Strike price (in dollars per share) | $ 28.02 | $ 25.34 | $ 28.01 | ||||||||
Vesting period (in years) | 5 years | ||||||||||
Expiration (in years) | 10 years | ||||||||||
Tranche One | |||||||||||
Employee Stock Purchase Plan | |||||||||||
Shares (in shares) | 119,300 | 120,900 | 75,300 | 18,750 | 69,375 | 119,300 | |||||
Forfeited (in shares) | 0 | (1,950) | (1,950) | 0 | (6,750) | ||||||
Outstanding (in shares) | 119,300 | 118,950 | 73,350 | 18,750 | 62,625 | ||||||
Strike price (in dollars per share) | $ 25.34 | $ 28.01 | $ 30.67 | $ 30.07 | $ 29.47 | ||||||
Vesting period (in years) | 3 years | 3 years | 3 years | 3 years | 3 years | ||||||
Expiration (in years) | 10 years | 10 years | 10 years | 10 years | 10 years | ||||||
Tranche Two | |||||||||||
Employee Stock Purchase Plan | |||||||||||
Shares (in shares) | 119,200 | 119,100 | 149,250 | 18,750 | 35,625 | 119,200 | |||||
Forfeited (in shares) | 0 | (1,800) | (4,050) | 0 | 0 | ||||||
Outstanding (in shares) | 119,200 | 117,300 | 145,200 | 18,750 | 35,625 | ||||||
Strike price (in dollars per share) | $ 25.34 | $ 28.01 | $ 30.67 | $ 30.07 | $ 29.47 | ||||||
Vesting period (in years) | 5 years | 5 years | 5 years | 5 years | 5 years | ||||||
Expiration (in years) | 10 years | 10 years | 10 years | 10 years | 10 years |
Stock Options - Schedule of Opt
Stock Options - Schedule of Options Outstanding (Details) - $ / shares | Aug. 27, 2015 | Mar. 31, 2020 | Mar. 31, 2019 |
Shares | |||
Outstanding, beginning of year (in shares) | 625,800 | 395,550 | |
Granted (in shares) | 58,125 | 238,500 | 240,000 |
Exercised (in shares) | 0 | 0 | |
Forfeited (in shares) | (22,875) | 0 | 0 |
Expired (in shares) | 0 | 0 | |
Outstanding, end of period (in shares) | 35,250 | 864,300 | 635,550 |
Exercisable, end of period (in shares) | 62,625 | 0 | |
Weighted Average Exercise Price | |||
Outstanding, weighted average exercise price (in dollars per share) | $ 29.29 | $ 30.08 | |
Granted (in dollars per share) | $ 28.02 | 25.34 | 28.01 |
Exercised (in dollars per share) | 0 | 0 | |
Forfeited (in dollars per share) | 0 | 0 | |
Expired (in dollars per share) | 0 | 0 | |
Outstanding, weighted average exercise price (in dollars per share) | 28.20 | 29.29 | |
Exercisable, end of period (in dollars per share) | $ 29.47 | $ 0 |
Leases - Assets and Liabilities
Leases - Assets and Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Leases [Abstract] | ||
Finance lease right of use assets | $ 5,406 | $ 5,456 |
Finance lease liabilities | $ 5,570 | $ 5,587 |
Leases - Lease Cost (Details)
Leases - Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Finance Lease Cost: | ||
Amortization of right-of-use asset | $ 50 | $ 65 |
Interest expense | 53 | 56 |
Operating lease cost | 91 | 88 |
Variable lease cost | 0 | 1 |
Total Lease Cost | $ 194 | $ 210 |
Leases - Maturity Schedule (Det
Leases - Maturity Schedule (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Operating | ||
2020 | $ 215 | |
2021 | 291 | |
2022 | 298 | |
2023 | 273 | |
2024 | 263 | |
2025 and thereafter | 3,176 | |
Total undiscounted cash flows | 4,516 | |
Discount on cash flows | (1,217) | |
Total lease liability | 3,299 | $ 4,170 |
Finance | ||
2020 | 211 | |
2021 | 282 | |
2022 | 283 | |
2023 | 284 | |
2024 | 290 | |
2025 and thereafter | 8,004 | |
Total undiscounted cash flows | 9,354 | |
Discount on cash flows | (3,784) | |
Total lease liability | $ 5,570 |
Leases - Weighted Average Term
Leases - Weighted Average Term and Discount Rate (Details) | Mar. 31, 2020 |
Operating | |
Weighted-average term (years) | 18 years 9 months 18 days |
Weighted-average discount rate | 3.51% |
Finance | |
Weighted-average term (years) | 27 years 10 months 24 days |
Weighted-average discount rate | 3.77% |
Reclassification of Comparati_2
Reclassification of Comparative Amounts (Details) | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Reclassification of Comparative Amounts | |
Effect of reclassification adjustment on net income or shareholders' equity | $ 0 |