Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Mar. 01, 2016 | Jun. 30, 2015 | |
Document and Entity Information | |||
Entity Registrant Name | PENNS WOODS BANCORP INC | ||
Entity Central Index Key | 716,605 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2015 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Public Float | $ 210,101,151 | ||
Entity Common Stock, Shares Outstanding | 4,738,166 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY |
CONSOLIDATED BALANCE SHEET
CONSOLIDATED BALANCE SHEET - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
ASSETS: | ||
Noninterest-bearing balances | $ 22,044 | $ 19,403 |
Interest-bearing deposits in other financial institutions | 752 | 505 |
Total cash and cash equivalents | 22,796 | 19,908 |
Investment securities available for sale, at fair value | 176,157 | 232,213 |
Investment securities, trading | 73 | 0 |
Loans held for sale | 757 | 550 |
Loans | 1,045,207 | 915,579 |
Allowance for loan losses | (12,044) | (10,579) |
Loans, net | 1,033,163 | 905,000 |
Premises and equipment, net | 21,830 | 21,109 |
Accrued interest receivable | 3,686 | 3,912 |
Bank-owned life insurance | 26,667 | 25,959 |
Investment in limited partnerships | 899 | 1,560 |
Goodwill | 17,104 | 17,104 |
Intangibles | 1,240 | 1,456 |
Deferred tax asset | 8,990 | 8,101 |
Other assets | 6,695 | 8,139 |
TOTAL ASSETS | 1,320,057 | 1,245,011 |
LIABILITIES: | ||
Interest-bearing deposits | 751,797 | 738,041 |
Noninterest-bearing deposits | 280,083 | 243,378 |
Total deposits | 1,031,880 | 981,419 |
Short-term borrowings | 46,638 | 40,818 |
Long-term borrowings | 91,025 | 71,176 |
Accrued interest payable | 426 | 381 |
Other liabilities | 13,809 | 15,250 |
TOTAL LIABILITIES | 1,183,778 | 1,109,044 |
SHAREHOLDERS’ EQUITY: | ||
Preferred stock, no par value, 3,000,000 shares authorized; no shares issued | 0 | 0 |
Common stock, par value $8.33, 15,000,000 shares authorized; 5,004,984 and 5,002,649 shares issued | 41,708 | 41,688 |
Additional paid-in capital | 49,992 | 49,896 |
Retained earnings | 58,038 | 53,107 |
Accumulated other comprehensive loss: | ||
Net unrealized gain on available for sale securities | 258 | 2,930 |
Defined benefit plan | (4,057) | (4,597) |
Treasury stock at cost, 257,852 and 197,834 shares | (9,660) | (7,057) |
TOTAL SHAREHOLDERS’ EQUITY | 136,279 | 135,967 |
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ 1,320,057 | $ 1,245,011 |
CONSOLIDATED BALANCE SHEET (Par
CONSOLIDATED BALANCE SHEET (Parenthetical) - $ / shares | Dec. 31, 2015 | Dec. 31, 2014 |
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) | $ 8.33 | $ 8.33 |
Common stock, shares authorized (in shares) | 15,000,000 | 15,000,000 |
Common stock, shares issued (in shares) | 5,004,984 | 5,002,649 |
Treasury stock, shares (in shares) | 257,852 | 197,834 |
CONSOLIDATED STATEMENT OF INCOM
CONSOLIDATED STATEMENT OF INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
INTEREST AND DIVIDEND INCOME: | |||
Loans, including fees | $ 39,134 | $ 36,495 | $ 32,353 |
Investment securities: | |||
Taxable | 3,426 | 5,111 | 6,034 |
Tax-exempt | 2,795 | 3,453 | 4,602 |
Dividend and other interest income | 769 | 547 | 310 |
TOTAL INTEREST AND DIVIDEND INCOME | 46,124 | 45,606 | 43,299 |
INTEREST EXPENSE: | |||
Deposits | 3,129 | 2,995 | 3,221 |
Short-term borrowings | 116 | 54 | 81 |
Long-term borrowings | 1,974 | 1,913 | 1,962 |
TOTAL INTEREST EXPENSE | 5,219 | 4,962 | 5,264 |
NET INTEREST INCOME | 40,905 | 40,644 | 38,035 |
PROVISION FOR LOAN LOSSES | 2,300 | 2,850 | 2,275 |
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES | 38,605 | 37,794 | 35,760 |
NON-INTEREST INCOME: | |||
Service charges | 2,383 | 2,419 | 2,307 |
Securities gains, available for sale | 2,592 | 3,515 | 2,417 |
Securities losses, trading | (22) | 0 | 0 |
Bank-owned life insurance | 720 | 923 | 677 |
Gain on sale of loans | 1,743 | 1,803 | 1,438 |
Insurance commissions | 781 | 1,146 | 1,084 |
Brokerage commissions | 1,064 | 1,077 | 1,018 |
Other | 3,504 | 3,625 | 3,101 |
TOTAL NON-INTEREST INCOME | 12,765 | 14,508 | 12,042 |
NON-INTEREST EXPENSE: | |||
Salaries and employee benefits | 17,023 | 17,273 | 15,415 |
Occupancy | 2,248 | 2,301 | 1,905 |
Furniture and equipment | 2,622 | 2,536 | 1,815 |
Pennsylvania shares tax | 954 | 907 | 864 |
Amortization of investment in limited partnerships | 661 | 661 | 661 |
Federal Deposit Insurance Corporation deposit insurance | 867 | 746 | 594 |
Marketing | 612 | 532 | 517 |
Intangible amortization | 311 | 345 | 213 |
Other | 8,438 | 8,589 | 8,283 |
TOTAL NON-INTEREST EXPENSE | 33,736 | 33,890 | 30,267 |
INCOME BEFORE INCOME TAX PROVISION | 17,634 | 18,412 | 17,535 |
INCOME TAX PROVISION | 3,736 | 3,804 | 3,451 |
NET INCOME | $ 13,898 | $ 14,608 | $ 14,084 |
EARNINGS PER SHARE - BASIC AND DILUTED (in dollars per share) | $ 2.91 | $ 3.03 | $ 3.19 |
WEIGHTED AVERAGE SHARES OUTSTANDING - BASIC AND DILUTED (in shares) | 4,772,239 | 4,816,149 | 4,410,626 |
DIVIDENDS PER SHARE (in dollars per share) | $ 1.88 | $ 1.88 | $ 2.13 |
CONSOLIDATED STATEMENT OF COMPR
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Statement of Comprehensive Income [Abstract] | |||
Net Income | $ 13,898 | $ 14,608 | $ 14,084 |
Other comprehensive (loss) income: | |||
Change in unrealized gain (loss) on available for sale securities | (1,457) | 11,242 | (16,270) |
Tax effect | 495 | (3,822) | 5,532 |
Net realized gain included in net income | (2,592) | (3,515) | (2,417) |
Tax effect | 882 | 1,195 | 822 |
Amortization (accretion) of unrecognized pension and post-retirement items | 817 | (2,837) | 3,155 |
Tax effect | (277) | 964 | (1,073) |
Total other comprehensive (loss) income | (2,132) | 3,227 | (10,251) |
Comprehensive income | $ 11,766 | $ 17,835 | $ 3,833 |
CONSOLIDATED STATEMENT OF CHANG
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Total | COMMON STOCK | ADDITIONAL PAID-IN CAPITAL | RETAINED EARNINGS | ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME | TREASURY STOCK |
Balance (in shares) at Dec. 31, 2012 | 4,019,112 | |||||
Balance at Dec. 31, 2012 | $ 93,726 | $ 33,492 | $ 18,157 | $ 43,030 | $ 5,357 | $ (6,310) |
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 14,084 | 14,084 | ||||
Other comprehensive income (loss) | (10,251) | (10,251) | ||||
Dividends declared | (9,560) | (9,560) | ||||
Common shares issued for acquisition of Luzerne National Bank Corporation (in shares) | 978,977 | |||||
Common shares issued for acquisition of Luzerne National Bank Corporation | 39,736 | $ 8,158 | 31,578 | |||
Common shares issued for employee stock purchase plan (in shares) | 1,840 | |||||
Common shares issued for employee stock purchase plan | 80 | $ 15 | 65 | |||
Balance (in shares) at Dec. 31, 2013 | 4,999,929 | |||||
Balance at Dec. 31, 2013 | 127,815 | $ 41,665 | 49,800 | 47,554 | (4,894) | (6,310) |
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 14,608 | 14,608 | ||||
Other comprehensive income (loss) | 3,227 | 3,227 | ||||
Dividends declared | (9,055) | (9,055) | ||||
Common shares issued for employee stock purchase plan (in shares) | 2,720 | |||||
Common shares issued for employee stock purchase plan | 119 | $ 23 | 96 | |||
Purchase of treasury stock | (747) | (747) | ||||
Balance (in shares) at Dec. 31, 2014 | 5,002,649 | |||||
Balance at Dec. 31, 2014 | 135,967 | $ 41,688 | 49,896 | 53,107 | (1,667) | (7,057) |
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 13,898 | 13,898 | ||||
Other comprehensive income (loss) | (2,132) | (2,132) | ||||
Dividends declared | (8,967) | (8,967) | ||||
Common shares issued for employee stock purchase plan (in shares) | 2,335 | |||||
Common shares issued for employee stock purchase plan | 116 | $ 20 | 96 | |||
Purchase of treasury stock | (2,603) | (2,603) | ||||
Balance (in shares) at Dec. 31, 2015 | 5,004,984 | |||||
Balance at Dec. 31, 2015 | $ 136,279 | $ 41,708 | $ 49,992 | $ 58,038 | $ (3,799) | $ (9,660) |
CONSOLIDATED STATEMENT OF CHAN7
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) - $ / shares | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Statement of Stockholders' Equity [Abstract] | ||
Dividends declared (in dollars per share) | $ 1.88 | $ 1.88 |
Purchase of treasury stock (in shares) | 60,018 | 17,238 |
CONSOLIDATED STATEMENT OF CASH
CONSOLIDATED STATEMENT OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
OPERATING ACTIVITIES: | |||
Net Income | $ 13,898 | $ 14,608 | $ 14,084 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 3,366 | 3,078 | 1,448 |
Amortization of intangible assets | 311 | 345 | 213 |
Provision for loan losses | 2,300 | 2,850 | 2,275 |
Accretion and amortization of investment security discounts and premiums | 873 | 672 | 69 |
Securities gains, net | (2,592) | (3,515) | (2,417) |
Originations of loans held for sale | (56,058) | (51,119) | (51,512) |
Proceeds of loans held for sale | 57,594 | 53,998 | 55,098 |
Gain on sale of loans | (1,743) | (1,803) | (1,438) |
Net securities losses, trading | 22 | 0 | 0 |
Proceeds from sales of trading securities | 709 | 0 | 0 |
Purchases of trading securities | (804) | 0 | 0 |
Earnings on bank-owned life insurance | (720) | (923) | (677) |
Decrease in deferred tax asset | 209 | 124 | 123 |
Other, net | (1,630) | 423 | 61 |
Net cash provided by operating activities | 15,735 | 18,738 | 17,327 |
Investment securities available for sale: | |||
Proceeds from sales | 65,672 | 102,145 | 79,114 |
Proceeds from calls and maturities | 22,859 | 13,354 | 16,359 |
Purchases | (32,776) | (47,902) | (90,179) |
Net increase in loans | (130,803) | (101,816) | (55,953) |
Acquisition of bank premises and equipment | (2,285) | (2,795) | (4,918) |
Proceeds from the sale of foreclosed assets | 1,868 | 1,059 | 143 |
Purchase of bank-owned life insurance | (30) | (30) | (981) |
Proceeds from bank-owned life insurance death benefit | 0 | 367 | 0 |
Proceeds from redemption of regulatory stock | 10,790 | 3,955 | 3,239 |
Purchases of regulatory stock | (12,818) | (4,583) | (2,384) |
Acquisition, net of cash acquired | 0 | 0 | 17,487 |
Net cash used for investing activities | (77,523) | (36,246) | (38,073) |
FINANCING ACTIVITIES: | |||
Net increase (decrease) in interest-bearing deposits | 13,756 | (17,584) | 34,114 |
Net increase in noninterest-bearing deposits | 36,705 | 26,001 | 19,906 |
Proceeds from long-term borrowings | 30,625 | 0 | 452 |
Repayment of long-term borrowings | (10,776) | (26) | (5,528) |
Net increase (decrease) in short-term borrowings | 5,820 | 14,102 | (9,254) |
Dividends paid | (8,967) | (9,055) | (9,560) |
Issuance of common stock | 116 | 119 | 80 |
Purchase of treasury stock | (2,603) | (747) | 0 |
Net cash provided by financing activities | 64,676 | 12,810 | 30,210 |
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | 2,888 | (4,698) | 9,464 |
CASH AND CASH EQUIVALENTS, BEGINNING | 19,908 | 24,606 | 15,142 |
CASH AND CASH EQUIVALENTS, ENDING | 22,796 | 19,908 | 24,606 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: | |||
Interest paid | 5,174 | 4,986 | 5,225 |
Income taxes paid | 2,933 | 3,750 | 3,998 |
Transfer of loans to foreclosed real estate | $ 340 | $ 2,166 | 470 |
Non-cash assets acquired: | |||
Securities available for sale | 21,783 | ||
Loans | 250,377 | ||
Premises and equipment, net | 8,014 | ||
Accrued interest receivable | 726 | ||
Bank-owned life insurance | 7,419 | ||
Intangibles | 2,015 | ||
Other assets | 2,636 | ||
Goodwill | 14,072 | ||
Noncash Assets Acquired | 307,042 | ||
Liabilities assumed: | |||
Deferred tax liability | 76 | ||
Interest-bearing deposits | 194,438 | ||
Noninterest-bearing deposits | 82,518 | ||
Short-term borrowings | 2,766 | ||
Accrued interest payable | 103 | ||
Other liabilities | 4,892 | ||
Noncash Liabilities Assumed | 284,793 | ||
Net non-cash assets acquired | 22,249 | ||
Cash and cash equivalents acquired | $ 20,363 |
OPERATIONS AND SUMMARY OF SIGNI
OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation The accompanying consolidated financial statements include the accounts of Penns Woods Bancorp, Inc. and its wholly owned subsidiaries, Jersey Shore State Bank (“JSSB”), Luzerne Bank ("Luzerne" collectively with JSSB "Banks"), Woods Real Estate Development Co., Inc., Woods Investment Company, Inc., and The M Group Inc. D/B/A The Comprehensive Financial Group (“The M Group”), a wholly owned subsidiary of JSSB, (collectively, the “Company”). All significant intercompany balances and transactions have been eliminated. Nature of Business The Banks engage in a full-service commercial banking business, making available to the community a wide range of financial services including, but not limited to, installment loans, credit cards, mortgage and home equity loans, lines of credit, construction financing, farm loans, community development loans, loans to non-profit entities and local government, and various types of demand and time deposits including, but not limited to, checking accounts, savings accounts, money market deposit accounts, certificates of deposit, and IRAs. Deposits are insured by the Federal Deposit Insurance Corporation (“FDIC”) to the extent provided by law. The financial services are provided by the Banks to individuals, partnerships, non-profit organizations, and corporations through their twenty-three offices located in Clinton, Lycoming, Centre, Montour, Union, and Luzerne Counties, Pennsylvania. Woods Real Estate Development Co., Inc. engages in real estate transactions on behalf of Penns Woods Bancorp, Inc. and the Banks. Woods Investment Company, Inc., a Delaware holding company, is engaged in investing activities. The M Group engages in securities brokerage and financial planning services, which include the sale of life insurance products, annuities, and estate planning services. Operations are managed and financial performance is evaluated on a corporate-wide basis. Accordingly, all financial service operations are considered by management to be aggregated in one reportable operating segment. Use of Estimates The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from those estimates. Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan losses, valuation of net deferred tax assets, impairment of goodwill, other than temporary impairment of debt and equity securities, fair value of financial instruments, and the valuation of real estate acquired through, or in lieu of, foreclosure on settlement of debt. Cash and Cash Equivalents Cash and cash equivalents include cash on hand and in banks and federal funds sold. Interest-earning deposits mature within 90 days and are carried at cost. Net cash flows are reported for loan, deposit, and short-term borrowing transactions. Restrictions on Cash and Cash Equivalents Based on deposit levels, the Banks must maintain cash and other reserves with the Federal Reserve Bank of Philadelphia (FRB). Investment Securities Investment securities are classified at the time of purchase, based on management’s intention and ability, as securities held to maturity, securities available for sale, or securities held for trading. Debt securities acquired with the intent and ability to hold to maturity are stated at cost, adjusted for amortization of premium and accretion of discount, which are computed using the interest method and recognized as adjustments of interest income. Certain other debt securities have been classified as available for sale to serve principally as a source of liquidity. Unrealized holding gains and losses for available for sale securities are reported as a separate component of shareholders’ equity, net of tax, until realized. Unrealized holding gains and losses for equity securities held for trading are recognized as a separate component within the income statement. Realized security gains and losses are computed using the specific identification method for debt securities and the average cost method for marketable equity securities. Interest and dividends on investment securities are recognized as income when earned. Securities are periodically reviewed for other-than-temporary impairment based upon a number of factors, including, but not limited to, the length of time and extent to which the fair value has been less than cost, the financial condition of the underlying issuer, the ability of the issuer to meet contractual obligations, the likelihood of the security’s ability to recover any decline in its fair value, whether it is more likely than not that the Company would be required to sell the security before its anticipated recovery in fair value, and a review of the Company’s capital adequacy, interest rate risk position, and liquidity. The assessment of a security’s ability to recover any decline in fair value, the ability of the issuer to meet contractual obligations, and management’s intent and ability requires considerable judgment. A decline in value that is considered to be other-than-temporary is recorded as a loss within non-interest income in the Consolidated Statement of Income. Investment securities fair values are based on observed market prices. Certain investment securities do not have observed bid prices and their fair value is based on instruments with similar risk elements. Since regulatory stock is redeemable at par, the Company carries it at cost. Loans Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff generally are stated at the principal amount outstanding, net of deferred fees and discounts, unamortized loan fees and costs, and the allowance for loan losses. Interest on loans is recognized as income when earned on the accrual method. The Company’s general policy has been to stop accruing interest on loans when it is determined a reasonable doubt exists as to the collectability of additional interest. Income is subsequently recognized only to the extent that cash payments are received provided the loan is not delinquent in payment and, in management’s judgment, the borrower has the ability and intent to make future principal payments. Otherwise, payments are applied to the unpaid principal balance of the loan. Loans are restored to accrual status if certain conditions are met, including but not limited to, the repayment of all unpaid interest and scheduled principal due, ongoing performance consistent with the contractual agreement, and the future expectation of continued, timely payments. Loan origination and commitment fees as well as certain direct loan origination costs are being deferred and amortized as an adjustment to the related loan’s yield over the contractual lives of the related loans. Allowance for Loan Losses The allowance for loan losses represents the amount which management estimates is adequate to provide for probable losses inherent in its loan portfolio, as of the Consolidated Balance Sheet date. The allowance method is used in providing for loan losses. Accordingly, all loan losses are charged to the allowance and all recoveries are credited to it. The allowance for loan losses is established through a provision for loan losses charged to operations. The provision for loan losses is based upon management’s quarterly review of the loan portfolio. The purpose of the review is to assess loan quality, identify impaired loans, analyze delinquencies, ascertain loan growth, evaluate potential charge-offs and recoveries, and assess general economic conditions in the markets served. An external independent loan review is also performed annually for the Bank. Management remains committed to an aggressive program of problem loan identification and resolution. The allowance is calculated by applying loss factors to outstanding loans by type, excluding loans for which a specific allowance has been determined. Loss factors are based on management’s consideration of the nature of the portfolio segments, changes in mix and volume of the loan portfolio, historical loan loss experience, and general economic conditions. In addition, management considers industry standards and trends with respect to nonperforming loans and its knowledge and experience with specific lending segments. Although management believes that it uses the best information available to make such determinations and that the allowance for loan losses is adequate at December 31, 2015, future adjustments could be necessary if circumstances or economic conditions differ substantially from the assumptions used in making the initial determinations. A downturn in the local economy, rising unemployment, or negative performance trends in financial information from borrowers could be indicators of subsequent increased levels of nonperforming assets and possible charge-offs, which would normally require increased loan loss provisions. An integral part of the periodic regulatory examination process is the review of the adequacy of the Banks' loan loss allowance. The regulatory agencies could require the Banks, based on their evaluation of information available at the time of their examination, to provide additional loan loss provisions to further supplement the allowance. Impaired loans are commercial and commercial real estate 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 “nonaccrual loans,” although the two categories overlap. The Banks may choose to place a loan on nonaccrual status due to payment delinquency or uncertain collectability, while not classifying the loan as impaired if the loan is not a commercial or commercial real estate loan. 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 loans. When foreclosure is probable, impairment is measured based on the fair value of the collateral. 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. 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. Loan Charge-off Policies Loans are generally fully or partially charged down to the fair value of collateral securing the asset when: • management judges the asset to be uncollectible; • repayment is deemed to be protracted beyond reasonable time frames; • the asset has been classified as a loss by either the internal loan review process or external examiners; • the borrower has filed bankruptcy and the loss becomes evident due to a lack of assets; or • the loan is 180 days past due unless both well secured and in the process of collection. Troubled Debt Restructurings In situations where, for economic or legal reasons related to a borrower’s financial difficulties, management may grant a concession for other than an insignificant period of time to the borrower that would not otherwise be considered, the related loan is classified as a troubled debt restructuring (TDR). Management strives to identify borrowers in financial difficulty early and work with them to modify to more affordable terms before their loan reaches nonaccrual status. These modified terms may include rate reductions, principal forgiveness, payment forbearance, and other actions intended to minimize the economic loss and to avoid foreclosure or repossession of the collateral. In cases where borrowers are granted new terms that provide for a reduction of either interest or principal, management measures any impairment on the restructuring as noted above for impaired loans. In addition to the allowance for the pooled portfolios, management has developed a separate allowance for loans that are identified as impaired through a TDR. These loans are excluded from pooled loss forecasts and a separate reserve is provided under the accounting guidance for loan impairment. Consumer loans whose terms have been modified in a TDR are also individually analyzed for estimated impairment. Loans Held for Sale In general, fixed rate residential mortgage loans originated by the Banks are held for sale and are carried at cost due to their short holding period, which can range from less than two weeks to a maximum of thirty days. Sold loans are not serviced by the Banks. Proceeds from the sale of loans in excess of the carrying value are accounted for as a gain. Total gains on the sale of loans are shown as a component of non-interest income within the Consolidated Statement of Income. Foreclosed Assets Foreclosed assets are carried at the lower of cost or fair value less estimated selling costs. Prior to foreclosure, the value of the underlying loan is written down to the fair value of the real estate to be acquired by a charge to the allowance for loan losses, if necessary. Any subsequent write-downs are charged against operating expenses. Net operating expenses and gains and losses realized from disposition are included in non-interest expense and income, respectively, within the Consolidated Statement of Income. Premises and Equipment Land is carried at cost. Premises and equipment are stated at cost less accumulated depreciation. Depreciation is computed using straight-line and accelerated methods over the estimated useful lives of the related assets, which range from five to ten years for furniture, fixtures, and equipment and fifteen to forty years for buildings and improvements. Costs incurred for routine maintenance and repairs are charged to operations as incurred. Costs of major additions and improvements are capitalized. Bank-Owned Life Insurance The Company has purchased life insurance policies on certain officers and directors. Bank-owned life insurance is recorded at its cash surrender value, or the amount that can be realized. Increases in the cash surrender value are recognized as a component of non-interest income within the Consolidated Statement of Income. Goodwill The Company performs an annual impairment analysis of goodwill for its purchased subsidiaries, Luzerne and The M Group. Based on the fair value of these reporting units, estimated using the expected present value of future cash flows, no impairment of goodwill was recognized in 2015 , 2014 , or 2013 . Intangible Assets At December 31, 2015 , the Company had intangible assets of $1,240,000 as a result of the acquisition of Luzerne National Bank Corporation, which is net of accumulated amortization of $774,000 . These intangible assets will continue to be amortized using the sum-of-the-years digits method of amortization over ten years. Investments in Limited Partnerships The Company is a limited partner in four partnerships at December 31, 2015 that provide low income elderly housing in the Company’s geographic market area. The carrying value of the Company’s investments in limited partnerships was $ 899,000 at December 31, 2015 and $1,560,000 at December 31, 2014 . The investments are being amortized over the ten -year tax credit receipt period utilizing the straight-line method. The partnerships are amortized once the projects reach the level of occupancy needed to begin the ten year tax credit recognition period. Amortization of limited partnership investments amounted to $661,000 in 2015 , 2014 , and 2013 . Off-Balance Sheet Financial Instruments In the ordinary course of business, the Company enters into off-balance sheet financial instruments. Those instruments consist of commitments to extend credit and standby letters of credit. When those instruments are funded or become payable, the Company reports the amounts in its financial statements. Marketing Cost Marketing costs are generally expensed as incurred. Income Taxes The Company prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Benefits from tax positions should be recognized in the financial statements only when it is more likely than not that the tax position will be sustained upon examination by the appropriate taxing authority that would have full knowledge of all relevant information. A tax position that meets the more-likely-than-not recognition threshold is measured at the largest amount of benefit that is greater than fifty percent likely of being realized upon ultimate settlement. Tax positions that previously failed to meet the more-likely-than-not recognition threshold should be recognized in the first subsequent financial reporting period in which that threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not recognition threshold should be derecognized in the first subsequent financial reporting period in which that threshold is no longer met. Deferred tax assets and liabilities result from temporary differences in financial and income tax methods of accounting, and are reflected at currently enacted income tax rates applicable to the period in which the deferred tax assets or liabilities are expected to be realized or settled. As changes in tax laws or rates are enacted, deferred tax assets and liabilities are adjusted through the provision for income taxes. The Company analyzed its deferred tax asset position and determined that there was not a need for a valuation allowance due to the Company’s ability to generate future ordinary and capital taxable income. The Company when applicable recognizes interest and penalties on income taxes as a component of income tax provision. Earnings Per Share The Company provides dual presentation of basic and diluted earnings per share. Basic earnings per share is calculated utilizing net income as reported in the numerator and weighted average shares outstanding in the denominator. The computation of diluted earnings per share differs in that the dilutive effects of any stock options are adjusted in the denominator. Employee Benefits Pension and employee benefits include contributions, determined actuarially, to a defined benefit retirement plan covering the eligible employees of JSSB. The plan is funded on a current basis to the extent that it is deductible under existing federal tax regulations. Pension and other employee benefits also include contributions to a defined contribution Section 401(k) plan covering eligible employees. Contributions matching those made by eligible employees are funded throughout the year. In addition, an elective contribution may be made annually at the discretion of the board of directors for the employees of JSSB with contributions being made in 2015 and 2014. The M Group Products and Income Recognition The M Group product line is comprised primarily of annuities, life insurance, and mutual funds. The revenues generated from life insurance sales are commission only, as The M Group does not underwrite the policies. Life insurance sales include permanent and term policies with the majority of the policies written being permanent. Term life insurance policies are written for 10 , 15 , 20 , and 30 year terms with the majority of the policies being written for 20 years. None of these products are offered as an integral part of lending activities. Commissions from the sale of annuities are recognized at the time notice is received from the third party broker/dealer or an insurance company that the transaction has been accepted and approved, which is also the time when commission income is received. Life insurance commissions are recognized at varying points based on the payment option chosen by the customer. Commissions from monthly and annual payment plans are recognized at the start of each annual period for the life insurance, while quarterly and semi-annual premium payments are recognized quarterly and semi-annually when the earnings process is complete. For example, semi-annual payments on the first of January and July would result in commission income recognition on the first of January and July, while payments on the first of January, April, July, and October would result in commission income recognition on those dates. The potential for chargebacks only exists for those policies on a monthly payment plan since income is recognized at the beginning of the annual coverage period versus at the time of each monthly payment. No liability is maintained for chargebacks as these are removed from income at the time of the occurrence. Accumulated Other Comprehensive Income (Loss) The Company is required to present accumulated other comprehensive income (loss) in a full set of general-purpose financial statements for all periods presented. Accumulated other comprehensive income (loss) is comprised of unrealized holding gains (losses) on the available for sale securities portfolio and the unrecognized components of net periodic benefit costs of the defined benefit pension plan. Segment Reporting The Company has determined that its only reportable segment is Community Banking. Reclassification of Comparative Amounts Certain items previously reported have been reclassified to conform to the current year’s reporting format. Such reclassifications did not affect net income or shareholders’ equity. Recent Accounting Pronouncements In January 2014, FASB issued ASU 2014-01, Investments - Equity Method and Joint Ventures (Topic 323): Accounting for Investments in Qualified Affordable Housing Projects. The amendments in this update permit reporting entities to make an accounting policy election to account for their investments in qualified affordable housing projects using the proportional amortization method if certain conditions are met. Under the proportional amortization method, an entity amortizes the initial cost of the investment in proportion to the tax credits and other tax benefits received and recognizes the net investment performance in the income statement as a component of income tax expense (benefit). The amendments in this update should be applied retrospectively to all periods presented. A reporting entity that uses the effective yield method to account for its investments in qualified affordable housing projects before the date of adoption may continue to apply the effective yield method for those preexisting investments. The amendments in this update are effective for public business entities for annual periods and interim reporting periods within those annual periods, beginning after December 15, 2014. Early adoption is permitted. This ASU did not have an impact on the Company’s financial statements. In January 2014, the FASB issued ASU 2014-04, Receivables - Troubled Debt Restructurings by Creditors (Subtopic 310-40): Reclassification of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure. The amendments in this update clarify that an in substance repossession or foreclosure occurs, and a creditor is considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan, upon either (1) the creditor obtaining legal title to the residential real estate property upon completion of a foreclosure or (2) the borrower conveying all interest in the residential real estate property to the creditor to satisfy that loan through completion of a deed in lieu of foreclosure or through a similar legal agreement. Additionally, the amendments require interim and annual disclosure of both (1) the amount of foreclosed residential real estate property held by the creditor, and (2) the recorded investment in consumer mortgage loans collateralized by residential real estate property that are in the process of foreclosure according to local requirements of the applicable jurisdiction. The amendments in this update are effective for public business entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2014. An entity can elect to adopt the amendments in this update using either a modified retrospective transition method or a prospective transition method. The Company has provided the necessary disclosures in Note 6. Loan Credit Quality and Related Allowance for Loan Losses. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (a new revenue recognition standard). The update’s core principle is that a company will recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, this update specifies the accounting for certain costs to obtain or fulfill a contract with a customer and expands disclosure requirements for revenue recognition. This update is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. The Company is currently evaluating the impact the adoption of the standard will have on the Company’s financial position or results of operations. In June 2014, the FASB issued ASU 2014-11, Transfers and Servicing (Topic 860): Repurchase-to-Maturity Transactions, Repurchase Financings, and Disclosures . The amendments in this update change the accounting for repurchase-to-maturity transactions to secured borrowing accounting. For repurchase financing arrangements, the amendments require separate accounting for a transfer of a financial asset executed contemporaneously with a repurchase agreement with the same counterparty, which will result in secured borrowing accounting for the repurchase agreement. The amendments also require enhanced disclosures. The accounting changes in this update are effective for the first interim or annual period beginning after December 15, 2014. An entity is required to present changes in accounting for transactions outstanding on the effective date as a cumulative-effect adjustment to retained earnings as of the beginning of the period of adoption. Earlier application is prohibited. The disclosure for certain transactions accounted for as a sale is required to be presented for interim and annual periods beginning after December 15, 2014, and the disclosure for repurchase agreements, securities lending transactions, and repurchase-to-maturity transactions accounted for as secured borrowings is required to be presented for annual periods beginning after December 15, 2014, and for interim periods beginning after March 15, 2015. The disclosures are not required to be presented for comparative periods before the effective date. This update did not have an impact on the Company’s financial statements. In June 2014, the FASB issued ASU 2014-12, Compensation-Stock Compensation (Topic 718): Accounting for Share-Based Payments when the Terms of an Award Provide that a Performance Target Could Be Achieved After the Requisite Service Period . The amendments require that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. The amendments in this update are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. Entities may apply the amendments in this update either (a) prospectively to all awards granted or modified after the effective date or (b) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. If retrospective transition is adopted, the cumulative effect of applying this update as of the beginning of the earliest annual period presented in the financial statements should be recognized as an adjustment to the opening retained earnings balance at that date. Additionally, if retrospective transition is adopted, an entity may use hindsight in measuring and recognizing the compensation cost. This ASU did not have a significant impact on the Company’s financial statements. In August 2014, the FASB issued ASU 2014-14, Receivables - Troubled Debt Restructurings by Creditors (Subtopic 310-40) . The amendments in this update require that a mortgage loan be de-recognized and that a separate other receivable be recognized upon foreclosure if the following conditions are met: (1) the loan has a government guarantee that is not separable from the loan before foreclosure, (2) at the time of foreclosure, the creditor has the intent to convey the real estate property to the guarantor and make a claim on the guarantee, and the creditor has the ability to recover under that claim, and (3) at the time of foreclosure, any amount of the claim that is determined on the basis of the fair value of the real estate is fixed. Upon foreclosure, the separate other receivable should be measured based on the amount of the loan balance (principal and interest) expected to be recovered from the guarantor. The amendments in this update are effective for public business entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2014. This ASU did not have a significant impact on the Company’s financial statements. In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40) . The amendments in this update provide guidance in accounting principles generally accepted in the United States of America about management's responsibility to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern and to provide related footnote disclosures. The amendments in this update are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. This ASU is not expected to have a significant impact on the Company’s financial statements. In November 2014, the FASB issued ASU 2014-17, Business Combinations (Topic 805): Pushdown Accounting. The amendments in this update apply to the separate financial statements of an acquired entity and its subsidiaries that are a business or nonprofit activity (either public or nonpublic) upon the occurrence of an event in which an acquirer (an individual or an entity) obtains control of the acquired entity. An acquired entity may elect the option to apply pushdown accounting in the reporting period in which the change-in-control event occurs. If pushdown accounting is not applied in the reporting period in which the change-in-control event occurs, an acquired entity will have the option to elect to apply pushdown accounting in a subsequent reporting period to the acquired entity's most recent change-in-control event. The amendments in this update are effective on November 18, 2014. After the effective date, an acquired entity can make an election to apply the guidance to future change-in-control events or to its most recent change-in-control event. This update will not have an impact on the Company’s financial statements. In January 2015, the FASB issued ASU 2015-01, Income Statement -Extraordinary and Unusual Items, as part of its initiative to reduce complexity in accounting standards. This update eliminates from GAAP the concept of extraordinary items. The amendments in this update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015. A report |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | 12 Months Ended |
Dec. 31, 2015 | |
Equity [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The changes in accumulated other comprehensive income (loss) by component shown net of tax as of December 31, 2015 and 2014 were as follows: Twelve Months Ended December 31, 2015 Twelve Months Ended December 31, 2014 (In Thousands) Net Unrealized Gain (Loss) on Available Defined Benefit Plan Total Net Unrealized Gain (Loss) on Available Defined Total Beginning balance $ 2,930 $ (4,597 ) $ (1,667 ) $ (2,169 ) $ (2,725 ) $ (4,894 ) Other comprehensive (loss) income before reclassifications (962 ) 435 (527 ) 7,419 (2,010 ) 5,409 Amounts reclassified from accumulated other comprehensive (loss) income (1,710 ) 105 (1,605 ) (2,320 ) 138 (2,182 ) Net current-period other comprehensive income (loss) (2,672 ) 540 (2,132 ) 5,099 (1,872 ) 3,227 Ending balance $ 258 $ (4,057 ) $ (3,799 ) $ 2,930 $ (4,597 ) $ (1,667 ) The reclassifications out of accumulated other comprehensive income as of December 31, 2015 and 2014 were as follows: (In Thousands) Amount Reclassified from Accumulated Other Comprehensive Income Details about Accumulated Other Comprehensive Income Components Twelve Months Ended Affected Line Item in the Consolidated Statement of Income December 31, 2015 December 31, 2014 Net realized gain on available for sale securities $ (2,592 ) $ (3,515 ) Securities gains, net Income tax effect 882 1,195 Income tax provision (1,710 ) (2,320 ) Net of tax Net unrecognized pension costs 159 209 Salaries and employee benefits Income tax effect (54 ) (71 ) Income tax provision $ 105 $ 138 Net of tax |
PER SHARE DATA
PER SHARE DATA | 12 Months Ended |
Dec. 31, 2015 | |
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; therefore, net income as presented on the consolidated statement of income will be used as the numerator. The following table sets forth the composition of the weighted average common shares (denominator) used in the basic and dilutive per share computation. Year Ended December 31, 2015 2014 2013 Weighted average common shares issued 5,003,691 5,001,171 4,591,222 Average treasury stock shares (231,452 ) (185,022 ) (180,596 ) Weighted average common shares used to calculate basic and diluted earnings per share 4,772,239 4,816,149 4,410,626 There were 38,750 stock options issued during the third quarter of 2015 with 34,750 outstanding at December 31, 2015. The outstanding stock options did not impact diluted earnings per share as the strike price of the options was greater than the market price. There were no stock options outstanding during 2014 and 2013 . |
INVESTMENT SECURITIES
INVESTMENT SECURITIES | 12 Months Ended |
Dec. 31, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |
INVESTMENT SECURITIES | INVESTMENT SECURITIES The amortized cost and fair values of investment securities at December 31, 2015 and 2014 are as follows: 2015 (In Thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Available for sale (AFS) U.S. Government and agency securities $ 3,586 $ — $ (37 ) $ 3,549 Mortgage-backed securities 9,785 284 (60 ) 10,009 Asset-backed securities 1,960 — (20 ) 1,940 State and political securities 84,992 1,797 (234 ) 86,555 Other debt securities 59,832 185 (2,245 ) 57,772 Total debt securities 160,155 2,266 (2,596 ) 159,825 Financial institution equity securities 10,397 1,100 (14 ) 11,483 Other equity securities 5,214 70 (435 ) 4,849 Total equity securities 15,611 1,170 (449 ) 16,332 Total investment securities AFS $ 175,766 $ 3,436 $ (3,045 ) $ 176,157 2014 (In Thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Available for sale (AFS) U.S. Government and agency securities $ 3,953 $ — $ (112 ) $ 3,841 Mortgage-backed securities 12,240 485 (28 ) 12,697 Asset-backed securities 2,468 27 (3 ) 2,492 State and political securities 104,820 3,885 (589 ) 108,116 Other debt securities 89,736 1,026 (1,299 ) 89,463 Total debt securities 213,217 5,423 (2,031 ) 216,609 Financial institution equity securities 8,823 1,110 (18 ) 9,915 Other equity securities 5,733 84 (128 ) 5,689 Total equity securities 14,556 1,194 (146 ) 15,604 Total investment securities AFS $ 227,773 $ 6,617 $ (2,177 ) $ 232,213 The amortized cost and fair values of trading investment securities at December 31, 2015 are as follows. There were no trading securities at December 31, 2014. 2015 (In Thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Trading Financial institution equity securities $ 78 $ — $ (5 ) $ 73 Total trading securities $ 78 $ — $ (5 ) $ 73 The following tables show the Company’s gross unrealized losses and fair value, aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position, at December 31, 2015 and 2014 . 2015 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) U.S. Government and agency securities $ — $ — $ 3,549 $ (37 ) $ 3,549 $ (37 ) Mortgage-backed securities 6,081 (60 ) — — 6,081 (60 ) Asset-backed securities 1,626 (16 ) 314 (4 ) 1,940 (20 ) State and political securities 7,345 (47 ) 1,656 (187 ) 9,001 (234 ) Other debt securities 24,381 (530 ) 22,547 (1,715 ) 46,928 (2,245 ) Total debt securities 39,433 (653 ) 28,066 (1,943 ) 67,499 (2,596 ) Financial institution equity securities — — 53 (14 ) 53 (14 ) Other equity securities 2,363 (277 ) 1,001 (158 ) 3,364 (435 ) Total equity securities 2,363 (277 ) 1,054 (172 ) 3,417 (449 ) Total Investment Securities AFS $ 41,796 $ (930 ) $ 29,120 $ (2,115 ) $ 70,916 $ (3,045 ) 2014 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) U.S. Government and agency securities $ — $ — $ 3,841 $ (112 ) $ 3,841 $ (112 ) Mortgage-backed securities 6,741 (28 ) — — 6,741 (28 ) Asset-backed securities — — 519 (3 ) 519 (3 ) State and political securities 8,243 (14 ) 6,382 (575 ) 14,625 (589 ) Other debt securities 23,174 (718 ) 29,266 (581 ) 52,440 (1,299 ) Total debt securities 38,158 (760 ) 40,008 (1,271 ) 78,166 (2,031 ) Financial institution equity securities 407 (18 ) — — 407 (18 ) Other equity securities 1,837 (100 ) 773 (28 ) 2,610 (128 ) Total equity securities 2,244 (118 ) 773 (28 ) 3,017 (146 ) Total Investment Securities AFS $ 40,402 $ (878 ) $ 40,781 $ (1,299 ) $ 81,183 $ (2,177 ) At December 31, 2015 there were 44 individual securities in a continuous unrealized loss position for less than twelve months and 21 individual securities in a continuous unrealized loss position for greater than twelve months. The Company reviews its position quarterly and has asserted that at December 31, 2015 and 2014 , the declines outlined in the above table represent temporary declines and the Company does not intend to sell and does not believe they will be required to sell these securities before recovery of their cost basis, which may be at maturity. The Company has concluded that any impairment of its investment securities portfolio is not other than temporary but is the result of interest rate 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 December 31, 2015 , 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 $ 1,835 $ 1,843 Due after one year to five years 32,085 31,926 Due after five years to ten years 88,554 87,311 Due after ten years 37,681 38,745 Total $ 160,155 $ 159,825 Total gross proceeds from sales of securities available for sale were $65,672,000 , $102,145,000 , and $79,114,000 for 2015 , 2014 , and 2013 , respectively. The following table represents gross realized gains and losses on those transactions: Year Ended December 31, (In Thousands) 2015 2014 2013 Gross realized gains: U.S. Government and agency securities $ — $ 59 $ — Mortgage-backed securities — 89 — State and political securities 1,571 2,327 2,076 Other debt securities 825 622 490 Financial institution equity securities 183 710 241 Other equity securities 132 491 340 Total gross realized gains $ 2,711 $ 4,298 $ 3,147 Gross realized losses: U.S. Government and agency securities $ — $ 45 $ — Mortgage-backed securities — — 92 State and political securities 22 412 611 Other debt securities 54 209 27 Financial institution equity securities — — — Other equity securities 43 117 — Total gross realized losses $ 119 $ 783 $ 730 There were no impairment charges included in gross realized losses for the years ended December 31, 2015 , 2014 , and 2013 . Investment securities with a carrying value of approximately $131,089,000 and $128,501,000 at December 31, 2015 and 2014 , respectively, were pledged to secure certain deposits, repurchase agreements, and for other purposes as required by law. There is no concentration of investments that exceed ten percent of shareholders’ equity for any individual issuer, excluding those guaranteed by the U.S. Government. |
FEDERAL HOME LOAN BANK STOCK
FEDERAL HOME LOAN BANK STOCK | 12 Months Ended |
Dec. 31, 2015 | |
Federal Home Loan Banks [Abstract] | |
FEDERAL HOME LOAN BANK STOCK | FEDERAL HOME LOAN BANK STOCK The Banks are members of the Federal Home Loan Bank (“FHLB”) of Pittsburgh and as such, is required to maintain a minimum investment in stock of the FHLB that varies with the level of advances outstanding with the FHLB. The stock is bought from and sold to the FHLB based upon its $100 par value. The stock does not have a readily determinable fair value and as such is classified as restricted stock, carried at cost and evaluated for impairment as necessary. The stock’s value is determined by the ultimate recoverability of the par value rather than by recognizing temporary declines. The determination of whether the par value will ultimately be recovered is influenced by criteria such as the following: (a) the significance of the decline in net assets of the FHLB as compared to the capital stock amount and the length of time this situation has persisted (b) commitments by the FHLB to make payments required by law or regulation and the level of such payments in relation to the operating performance (c) the impact of legislative and regulatory changes on the customer base of the FHLB and (d) the liquidity position of the FHLB. Management evaluated the stock and concluded that the stock was not impaired for the periods presented herein. Management considered that the FHLB maintains regulatory capital ratios in excess of all regulatory capital requirements, liquidity appears adequate, new shares of FHLB stock continue to change hands at the $100 par value, and the payment of dividends. |
LOAN CREDIT QUALITY AND RELATED
LOAN CREDIT QUALITY AND RELATED ALLOWANCE FOR LOAN LOSSES | 12 Months Ended |
Dec. 31, 2015 | |
Loans and Leases Receivable Disclosure [Abstract] | |
LOAN CREDIT QUALITY AND RELATED ALLOWANCE FOR LOAN LOSSES | LOAN CREDIT QUALITY AND RELATED ALLOWANCE FOR LOAN LOSSES 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 to individuals. Real estate loans are further segmented into three categories: residential, commercial, and construction. The following table presents the related aging categories of loans, by segment, as of December 31, 2015 and 2014 : 2015 (In Thousands) Current Past Due 30 To 89 Days Past Due 90 & Still Accruing Non-Accrual Total Commercial, financial, and agricultural $ 162,312 $ 164 $ — $ 1,596 $ 164,072 Real estate mortgage: Residential 517,753 6,827 714 889 526,183 Commercial 295,784 720 265 5,770 302,539 Construction 26,545 67 — 212 26,824 Installment loans to individuals 26,572 429 — — 27,001 1,028,966 $ 8,207 $ 979 $ 8,467 1,046,619 Net deferred loan fees and discounts (1,412 ) (1,412 ) Allowance for loan losses (12,044 ) (12,044 ) Loans, net $ 1,015,510 $ 1,033,163 2014 (In Thousands) Current Past Due 30 To 89 Days Past Due 90 & Still Accruing Non-Accrual Total Commercial, financial, and agricultural $ 122,624 $ 773 $ — $ 759 $ 124,156 Real estate mortgage: Residential 450,503 6,078 332 847 457,760 Commercial 279,731 1,819 54 9,744 291,348 Construction 21,485 — — 511 21,996 Installment loans to individuals 21,125 383 1 — 21,509 895,468 $ 9,053 $ 387 $ 11,861 916,769 Net deferred loan fees and discounts (1,190 ) (1,190 ) Allowance for loan losses (10,579 ) (10,579 ) Loans, net $ 883,699 $ 905,000 Purchased loans acquired are recorded at fair value on their purchase date without a carryover of the related allowance for loan losses. Upon acquisition, the Company evaluated whether each acquired loan (regardless of size) was within the scope of ASC 310-30. Purchased credit-impaired loans are loans that have evidence of credit deterioration since origination and it is probable at the date of acquisition that the Company will not collect all contractually required principal and interest payments. The fair value of purchased credit-impaired loans, on the acquisition date, was determined, primarily based on the fair value of loan collateral. The carrying value of purchased loans acquired with deteriorated credit quality was $341,000 at December 31, 2015 . On the acquisition date, the preliminary estimate of the unpaid principal balance for all loans evidencing credit impairment acquired in the Luzerne acquisition was $1,211,000 and the estimated fair value of the loans was $878,000 . Total contractually required payments on these loans, including interest, at the acquisition date was $1,783,000 . However, the Company’s preliminary estimate of expected cash flows was $941,000 . At such date, the Company established a credit risk related non-accretable discount (a discount representing amounts which are not expected to be collected from the customer nor liquidation of collateral) of $842,000 relating to these impaired loans, reflected in the recorded net fair value. Such amount is reflected as a non-accretable fair value adjustment to loans. The Company further estimated the timing and amount of expected cash flows in excess of the estimated fair value and established an accretable discount of $63,000 on the acquisition date relating to these impaired loans. The carrying value of the loans acquired and accounted for in accordance with ASC 310-30, was determined by projecting discounted contractual cash flows. The table below presents the components of the purchase accounting adjustments related to the purchased impaired loans acquired in the Luzerne acquisition as of June 1, 2013: (In Thousands) June 1, 2013 Unpaid principal balance $ 1,211 Interest 572 Contractual cash flows 1,783 Non-accretable discount (842 ) Expected cash flows 941 Accretable discount (63 ) Estimated fair value $ 878 The amortizable yield for purchased credit-impaired loans was fully amortized during 2014. Changes in the amortizable yield for purchased credit-impaired loans were as follows for the twelve months ended December 31, 2014 (In Thousands) December 31, 2014 Balance at beginning of period $ 35 Accretion (35 ) Balance at end of period $ — The following table presents additional information regarding loans acquired with specific evidence of deterioration in credit quality under ASC 310-30: (In Thousands) December 31, 2015 December 31, 2014 Outstanding balance $ 441 $ 449 Carrying amount 341 349 The following table presents the 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 as of December 31, 2015 , 2014 , and 2013 : Year Ended December 31, 2015 2014 2013 (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 Interest Income That Would Have Been Recorded Based on Original Term and Rate Interest Income Recorded on a Cash Basis Commercial, financial, and agricultural $ 48 $ 53 $ 42 $ 33 $ 7 $ 3 Real estate mortgage: Residential 53 38 63 34 41 20 Commercial 281 54 600 264 447 251 Construction 16 — 63 2 88 56 $ 398 $ 145 $ 768 $ 333 $ 583 $ 330 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 on non-accrual loans. The following table presents the recorded investment, unpaid principal balance, and related allowance of impaired loans by segment as of December 31, 2015 and 2014 : 2015 (In Thousands) Recorded Investment Unpaid Principal Balance Related Allowance With no related allowance recorded: Commercial, financial, and agricultural $ 319 $ 319 $ — Real estate mortgage: Residential 1,142 1,142 — Commercial 1,735 1,785 — Construction 212 212 — 3,408 3,458 — With an allowance recorded: Commercial, financial, and agricultural 150 150 75 Real estate mortgage: Residential 1,573 1,703 376 Commercial 10,752 10,752 1,653 Construction — — — 12,475 12,605 2,104 Total: Commercial, financial, and agricultural 469 469 75 Real estate mortgage: Residential 2,715 2,845 376 Commercial 12,487 12,537 1,653 Construction 212 212 — $ 15,883 $ 16,063 $ 2,104 2014 (In Thousands) Recorded Investment Unpaid Principal Balance Related Allowance With no related allowance recorded: Commercial, financial, and agricultural $ 439 $ 439 $ — Real estate mortgage: Residential 139 139 — Commercial 3,228 3,228 — Construction 716 716 — 4,522 4,522 — With an allowance recorded: Commercial, financial, and agricultural 673 673 298 Real estate mortgage: Residential 1,327 1,449 147 Commercial 10,745 10,889 1,581 Construction 309 309 67 13,054 13,320 2,093 Total: Commercial, financial, and agricultural 1,112 1,112 298 Real estate mortgage: Residential 1,466 1,588 147 Commercial 13,973 14,117 1,581 Construction 1,025 1,025 67 $ 17,576 $ 17,842 $ 2,093 The following table presents the average recorded investment in impaired loans and related interest income recognized for December 31, 2015 , 2014 , and 2013 : 2015 (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 Commercial, financial, and agricultural $ 1,031 $ 21 $ 10 Real estate mortgage: Residential 2,570 72 47 Commercial 17,529 342 80 Construction 865 1 53 $ 21,995 $ 436 $ 190 2014 (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 Commercial, financial, and agricultural $ 763 $ 26 $ 25 Real estate mortgage: Residential 1,245 46 20 Commercial 10,987 130 101 Construction 1,086 17 89 $ 14,081 $ 219 $ 235 2013 (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 Commercial, financial, and agricultural $ 538 $ 26 $ — Real estate mortgage: Residential 1,581 62 25 Commercial 8,605 183 95 Construction 2,651 1 569 $ 13,375 $ 272 $ 689 Additional funds totaling $20,000 are committed to be advanced in connection with impaired loans. Modifications 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. Loan modifications that are considered TDRs completed during the twelve months ended December 31, 2015 and 2014 were as follows: Year Ended December 31, 2015 2014 (In Thousands, Except Number of Contracts) Number of Contracts Pre-Modification Outstanding Recorded Investment Post-Modification Outstanding Recorded Investment Number of Contracts Pre-Modification Outstanding Recorded Investment Post-Modification Outstanding Recorded Investment Commercial, financial, and agricultural 4 $ 213 $ 213 3 $ 620 $ 620 Real estate mortgage: Residential 11 962 962 3 392 392 Commercial 6 1,013 1,013 3 636 636 Construction 1 398 398 — — — Total 22 $ 2,586 $ 2,586 9 $ 1,648 $ 1,648 Of the twenty-two new troubled debt restructurings granted for the year ended December 31, 2015, seven loans totaling $1,008,000 were granted payment concessions, four loans totaling $183,000 were granted term concessions, two loans totaling $287,000 were granted rate concessions, and nine loans totaling 1,108,000 were granted concessions due to other default. Of the nine new troubled debt restructurings granted for the year ended December 31, 2014, five loans totaling $1,142,000 were granted term concessions, three loans totaling $288,000 were granted payment concessions, and one loan totaling 218,000 was granted a rate concession. Loan modifications considered troubled debt restructurings made during the twelve months previous to December 31, 2015, that have defaulted during the twelve month period ending December 31, 2015 were as follows: Year Ended December 31, 2015 (In Thousands, Except Number of Contracts) Number of Contracts Recorded Investment Commercial, financial, and agricultural 1 $ 106 Real estate mortgage: Residential 6 374 Commercial 1 242 Total 8 $ 722 There was one commercial real estate loan modifications considered a troubled debt restructurings made during the twelve months previous to December 31, 2014 that defaulted during the twelve month period ending December 31, 2014. However, that loan was paid off in the fourth quarter of 2014. 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 annual loan review of large commercial relationships is performed, as well as a sample of smaller transactions. During 2015, the threshold for the annual loan review was commercial relationships $1,100,000 or greater for JSSB and $1,450,000 or greater for Luzerne. 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 December 31, 2015 and 2014 : 2015 Commercial and Real Estate Mortgages Installment Loans (In Thousands) Agricultural Residential Commercial Construction to Individuals Totals Pass $ 160,734 $ 522,853 $ 277,248 $ 26,612 $ 27,001 $ 1,014,448 Special Mention 1,669 823 8,625 — — 11,117 Substandard 1,669 2,507 16,666 212 — 21,054 Total $ 164,072 $ 526,183 $ 302,539 $ 26,824 $ 27,001 $ 1,046,619 2014 Commercial and Real Estate Mortgages Installment Loans (In Thousands) Agricultural Residential Commercial Construction to Individuals Totals Pass $ 118,210 $ 454,885 $ 256,444 $ 20,927 $ 21,509 $ 871,975 Special Mention 3,186 2,384 16,262 445 — 22,277 Substandard 2,760 491 18,642 624 — 22,517 Total $ 124,156 $ 457,760 $ 291,348 $ 21,996 $ 21,509 $ 916,769 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 twelve months ended December 31, 2015 and 2014 : 2015 Commercial and Agricultural Real Estate Mortgages Installment Loans to Individual (In Thousands) Residential Commercial Construction Unallocated Totals Beginning Balance $ 1,124 $ 3,755 $ 4,205 $ 786 $ 245 $ 464 $ 10,579 Charge-offs (283 ) (49 ) (743 ) (46 ) (240 ) — (1,361 ) Recoveries 176 81 182 23 64 — 526 Provision 515 1,329 573 (603 ) 174 312 2,300 Ending Balance $ 1,532 $ 5,116 $ 4,217 $ 160 $ 243 $ 776 $ 12,044 2014 Commercial and Agricultural Real Estate Mortgages Installment Loans to Individuals (In Thousands) Residential Commercial Construction Unallocated Totals Beginning Balance $ 474 $ 3,917 $ 4,079 $ 741 $ 139 $ 794 $ 10,144 Charge-offs (289 ) (65 ) (2,038 ) — (142 ) — (2,534 ) Recoveries 18 15 — 22 64 — 119 Provision 921 (112 ) 2,164 23 184 (330 ) 2,850 Ending Balance $ 1,124 $ 3,755 $ 4,205 $ 786 $ 245 $ 464 $ 10,579 The Company grants commercial, industrial, residential, and installment loans to customers throughout north-central and north-eastern Pennsylvania. Although the Company has a diversified loan portfolio at December 31, 2015 and 2014 , 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 loans at December 31, 2015 and 2014 as follows: 2015 2014 Owners of residential rental properties 16.21 % 16.01 % Owners of commercial rental properties 14.22 % 14.67 % The following table presents the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method as of December 31, 2015 and 2014 : 2015 Commercial and Agricultural Real Estate Mortgages Installment Loans to Individuals Unallocated Totals (In Thousands) Residential Commercial Construction Allowance for Loan Losses: Ending allowance balance attributable to loans: Individually evaluated for impairment $ 75 $ 376 $ 1,653 $ — $ — $ — $ 2,104 Collectively evaluated for impairment 1,457 4,740 2,564 160 243 776 9,940 Total ending allowance balance $ 1,532 $ 5,116 $ 4,217 $ 160 $ 243 $ 776 $ 12,044 Loans: Individually evaluated for impairment $ 469 $ 2,374 $ 12,487 $ 212 $ — $ 15,542 Loans acquired with deteriorated credit quality — 341 — — — 341 Collectively evaluated for impairment 163,603 523,468 290,052 26,612 27,001 1,030,736 Total ending loans balance $ 164,072 $ 526,183 $ 302,539 $ 26,824 $ 27,001 $ 1,046,619 2014 Commercial and Agricultural Real Estate Mortgages Installment Loans to Individuals (In Thousands) Residential Commercial Construction Unallocated Totals Allowance for Loan Losses: Ending allowance balance attributable to loans: Individually evaluated for impairment $ 298 $ 147 $ 1,581 $ 67 $ — $ — $ 2,093 Collectively evaluated for impairment 826 3,608 2,624 719 245 464 8,486 Total ending allowance balance $ 1,124 3,755 $ 4,205 $ 786 $ 245 $ 464 $ 10,579 Loans: Individually evaluated for impairment $ 1,112 $ 1,117 $ 13,973 $ 1,025 $ — $ 17,227 Loans acquired with deteriorated credit quality — 349 — — — 349 Collectively evaluated for impairment 123,044 456,294 277,375 20,971 21,509 899,193 Total ending loans balance $ 124,156 457,760 $ 291,348 $ 21,996 $ 21,509 $ 916,769 |
PREMISES AND EQUIPMENT
PREMISES AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |
PREMISES AND EQUIPMENT | PREMISES AND EQUIPMENT Major classifications of premises and equipment are summarized as follows at December 31, 2015 and 2014 : (In Thousands) 2015 2014 Land $ 5,764 $ 5,759 Premises 16,074 14,767 Furniture and equipment 8,231 7,435 Leasehold improvements 1,462 1,351 Total 31,531 29,312 Less accumulated depreciation and amortization 9,701 8,203 Net premises and equipment $ 21,830 $ 21,109 Depreciation and amortization related to premises and equipment for the years ended 2015 , 2014 , and 2013 was $1,564,000 , $1,494,000 , and $1,054,000 , respectively. |
GOODWILL AND OTHER INTANGIBLES
GOODWILL AND OTHER INTANGIBLES | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER INTANGIBLES | GOODWILL AND OTHER INTANGIBLES As of December 31, 2015 and 2014 goodwill had a gross carrying value of $17,380,000 and accumulated amortization of $276,000 resulting in a net carrying amount of $17,104,000 . The gross carrying amount of goodwill is tested for impairment in the third quarter of each fiscal year. Based on the fair value of the reporting unit, estimated using the expected present value of future cash flows, there was no evidence of impairment of the carrying amount at December 31, 2015 or 2014 . Identifiable intangibles are amortized to their estimated residual values over the expected useful lives. Such lives are also periodically reassessed to determine if any amortization period adjustments are required. Since the acquisition, no such adjustments were recorded. The identifiable intangible assets consist of a core deposit intangible and a trade name intangible which are being amortized on an accelerated basis, and also book of business intangible that is being amortized on a straightline basis over the useful life of such assets. The gross carrying amount of the core deposit intangible, the trade name intangible, and the book of business intangible at December 31, 2015 was $1,072,000 , $ 76,000 , and $92,000 respectively, with $521,000 , $37,000 , and $3,000 accumulated amortization as of that date. As of December 31, 2015 , the estimated future amortization expense for the core deposit and trade name intangible was: (In Thousands) Core Deposit Intangible Trade Name Intangible Book of Business Intangible 2016 254 18 10 2017 220 15 10 2018 185 13 10 2019 151 11 10 2020 117 8 10 2021 83 6 10 2022 48 4 10 2023 14 1 10 2024 — — 10 2025 — — 2 $ 1,072 $ 76 $ 92 |
TIME DEPOSITS
TIME DEPOSITS | 12 Months Ended |
Dec. 31, 2015 | |
Banking and Thrift [Abstract] | |
TIME DEPOSITS | TIME DEPOSITS Time deposits of $250,000 or more totaled approximately $28,953,000 on December 31, 2015 and $26,468,000 on December 31, 2014 . Interest expense on time deposits of $100,000 or more was approximately $1,112,000 , $875,000 , and $841,000 , for the years ended December 31, 2015 , 2014 , and 2013 , respectively. At December 31, 2015 , the scheduled maturities on time deposits of $100,000 or more are as follows: (In Thousands) 2015 Three months or less $ 12,006 Three months to six months 5,863 Six months to twelve months 17,036 Over twelve months 71,687 Total $ 106,592 Total time deposit maturities are as follows at December 31, 2015 : (In Thousands) 2015 2016 $ 81,010 2017 55,318 2018 51,104 2019 24,796 2020 7,093 Thereafter 2,056 Total $ 221,377 |
SHORT-TERM BORROWINGS
SHORT-TERM BORROWINGS | 12 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
SHORT-TERM BORROWINGS | SHORT-TERM BORROWINGS Short-term borrowings consist of securities sold under agreements to repurchase and primarily FHLB advances, which generally represent overnight or less than six month borrowings. In addition to the outstanding balances noted below, the Banks also have additional lines of credit totaling $35,413,000 available from correspondent banks other than the FHLB. The outstanding balances and related information for short-term borrowings are summarized as follows at December 31, 2015 , 2014 , and 2013 : (In Thousands) 2015 2014 2013 Repurchase Agreements: Balance at year end $ 18,334 $ 13,987 $ 12,391 Maximum amount outstanding at any month end 18,614 18,801 16,632 Average balance outstanding during the year 15,834 16,350 16,839 Weighted-average interest rate: At year end 0.21 % 0.23 % 0.28 % Paid during the year 0.21 % 0.22 % 0.40 % Overnight: Balance at year end $ 28,304 $ 26,831 $ 14,325 Maximum amount outstanding at any month end 42,760 26,831 21,350 Average balance outstanding during the year 23,075 5,992 5,508 Weighted-average interest rate: At year end 0.43 % 0.27 % 0.25 % Paid during the year 0.36 % 0.30 % 0.31 % We utilize securities sold under agreements to repurchase to facilitate the needs of our customers and to facilitate secured short-term funding needs. Securities sold under agreements to repurchase are stated at the amount of cash received in connection with the transaction. We monitor collateral levels on a continuous basis. We may be required to provide additional collateral based on the fair value of the underlying securities. Securities pledged as collateral under repurchase agreements are maintained with our safekeeping agents. The remaining contractual maturity of repurchase agreements in the consolidated balance sheets as of December 31, 2015 and December 31, 2014 is presented in the following tables. 2015 2014 Remaining Contractual Maturity of the Agreements (In Thousands) Overnight and Continuous Overnight and Continuous Repurchase Agreements: U.S. Government and agency securities $ 3,586 $ 3,953 Mortgage-back securities 8,368 4,526 Asset-backed securities 1,960 2,468 State and political securities 8,015 7,070 Other debt securities 2,155 2,218 Total carrying value of collateral pledged $ 24,084 $ 20,235 Total liability recognized for repurchase agreements $ 18,334 $ 13,987 |
LONG-TERM BORROWINGS
LONG-TERM BORROWINGS | 12 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
LONG-TERM BORROWINGS | LONG-TERM BORROWINGS The following represents outstanding long-term borrowings with the FHLB by contractual maturities at December 31, 2015 and 2014 : (In Thousands) Weighted Average Interest Rate Stated Interest Rate Range Description Maturity 2015 2014 From To 2015 2014 Variable 2015 — % 3.97 % 3.97 % 3.97 % $ — $ 10,000 Variable 2017 4.22 % 4.22 % 4.15 % 4.28 % 20,000 20,000 Variable 2018 3.18 % 3.18 % 3.18 % 3.18 % 10,000 10,000 Total Variable 3.87 % 3.90 % 30,000 40,000 Fixed 2015 — % 6.92 % 6.92 % 6.92 % — 750 Fixed 2016 0.75 % 0.75 % 0.75 % 0.75 % 5,000 5,000 Fixed 2017 0.91 % 0.91 % 0.90 % 0.97 % 25,000 25,000 Fixed 2018 1.13 % — % 1.13 % 1.13 % 2,000 — Fixed 2019 1.55 % — % 1.54 % 1.55 % 7,292 — Fixed 2020 1.70 % — % 1.62 % 1.79 % 18,333 — Fixed 2022 2.04 % — % 2.04 % 2.04 % 3,000 — Total Fixed 1.28 % 1.03 % 60,625 30,750 Total 2.14 % 2.65 % $ 90,625 $ 70,750 (In Thousands) Year Ending December 31, Amount Weighted Average Rate 2016 5,000 0.75 % 2017 45,000 2.38 % 2018 12,000 2.84 % 2019 7,292 1.55 % Thereafter 21,333 1.75 % $ 90,625 2.14 % The terms of the convertible borrowings allow the FHLB to convert the interest rate to an adjustable rate based on the three month London Interbank Offered Rate (“LIBOR”) at a predetermined anniversary date of the borrowing’s origination, ranging from three months to five years. If the FHLB converts the interest rate on one of the predetermined dates, the Bank has the ability to pay off the debt on the conversion date and quarterly thereafter without incurring the customary pre-payment penalty. The Banks maintain a credit arrangement which includes a revolving line of credit with the FHLB. Under this credit arrangement, at December 31, 2015 JSSB has a remaining borrowing capacity of $236,434,000 and Luzerne has a remaining capacity of $145,476,000 , which are subject to annual renewal and typically incur no service charges. Under terms of a blanket agreement, collateral for the FHLB borrowings must be secured by certain qualifying assets of each Bank which consist principally of first mortgage loans and mortgage-backed securities. In December 2012, JSSB entered in to a capital lease on a piece of land in Lewisburg, Pennsylvania. The carrying amount of the land as of December 31, 2015 and 2014 was $827,000 . The present value of minimum lease payments at December 31, 2015 and 2014 was $400,000 and $426,000 . The following is a schedule showing the future minimum lease payments under the capital lease by years and the present value of the minimum lease payments as of December 31, 2015. The interest rate related to the lease obligation is 2.75% and the maturity date is October 2023. (In Thousands) Lease Payment Interest Present Value of Minimum Lease Payment 2016 $ 38 $ 11 $ 27 2017 38 10 28 2018 38 9 29 2019 38 9 29 2020 38 8 30 Thereafter 276 19 257 $ 466 $ 66 $ 400 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The following temporary differences gave rise to the net deferred tax asset position at December 31, 2015 and 2014 : (In Thousands) 2015 2014 Deferred tax assets: Allowance for loan losses $ 3,976 $ 3,380 Deferred compensation 1,696 1,579 Defined Pension 1,525 2,172 Deferred Loan fees and discounts 272 256 Investment securities allowance 517 487 Low income housing credit carryforward 1,181 2,034 Capital loss carryforward — 98 Other 1,696 1,578 Total 10,863 11,584 Deferred tax liabilities: Unrealized gain on available for sale securities 133 1,510 Investment security accretion 231 262 Depreciation 478 734 Amortization 1,031 977 Total 1,873 3,483 Deferred tax asset, net $ 8,990 $ 8,101 The current low income housing credit carryforward will expire in 2031. The Company fully anticipates being able to use the carry-forward. No valuation allowance was established at December 31, 2015 and 2014 , because of the Company’s ability to carry back capital losses to recover taxes paid in previous years and certain tax strategies, together with the anticipated future taxable income as evidenced by the Company’s earning potential. The Corporation is no longer subject to federal, state, and local examinations by tax authorities for years before 2012. The provision or benefit for income taxes is comprised of the following for the year ended December 31, 2015 , 2014 , and 2013 : (In Thousands) 2015 2014 2013 Currently payable $ 3,527 $ 3,680 $ 3,328 Deferred benefit 209 124 123 Total provision $ 3,736 $ 3,804 $ 3,451 A reconciliation between the expected income tax or benefit and the effective income tax rate on income before income tax provision or benefit follows for the year ended December 31, 2015 , 2014 , and 2013 : 2015 2014 2013 (In Thousands) Amount % Amount % Amount % Provision at expected rate $ 5,996 34.00 % $ 6,260 34.00 % $ 5,962 34.00 % (Decrease) increase in tax resulting from: Tax-exempt income (1,492 ) (8.46 ) (1,673 ) (9.09 ) (1,933 ) (11.02 ) Tax credits (737 ) (4.17 ) (737 ) (4.00 ) (737 ) (4.20 ) Other, net (31 ) (0.18 ) (46 ) (0.25 ) 159 0.90 Effective income tax provision and rate $ 3,736 21.19 % $ 3,804 20.66 % $ 3,451 19.68 % |
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS | 12 Months Ended |
Dec. 31, 2015 | |
Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract] | |
EMPLOYEE BENEFIT PLANS | EMPLOYEE BENEFIT PLANS Defined Benefit Pension Plan The Company has a noncontributory defined benefit pension plan (the “Plan”) for all employees meeting certain age and length of service requirements that were hired prior to January 1, 2004, at which time entrance into the Plan was frozen. The benefit accrual for the Plan was subsequently frozen at December 31, 2014. Benefits are based primarily on years of service and the average annual compensation during the highest five consecutive years within the final ten years of employment - up until December 31, 2014 when the benefit accrual was frozen. The following table sets forth the obligation and funded status as of December 31, 2015 and 2014 : (In Thousands) 2015 2014 Change in benefit obligation: Benefit obligation at beginning of year $ 23,450 $ 18,186 Service cost — 484 Interest cost 757 859 Actuarial gain (144 ) 277 Benefits paid (639 ) (1,660 ) Curtailment gain (3,155 ) — Other, change in actuarial assumptions (1,322 ) 5,304 Benefit obligation at end of year $ 18,947 $ 23,450 Change in plan assets: Fair value of plan assets at beginning of year $ 13,906 $ 14,258 Actual return on plan assets 25 487 Employer contribution 965 850 Benefits paid (704 ) (1,736 ) Adjustment to fair value of plan assets 31 47 Fair value of plan assets at end of year 14,223 13,906 Funded status $ (4,724 ) $ (9,544 ) Accounts recognized on balance sheet as: Total liabilities $ (4,724 ) $ (9,544 ) Amounts not yet recognized as a component of net periodic pension cost: Amounts recognized in accumulated other comprehensive income (loss) consist of: Net loss $ 6,267 $ 6,965 The accumulated benefit obligation for the Plan was $18,947,000 and $20,296,000 at December 31, 2015 and 2014 , respectively. Components of Net Periodic Cost and Other Amounts Recognized in Other Comprehensive Income (loss) as of December 31, 2015 , 2014 , and 2013 are as follows: (In Thousands) 2015 2014 2013 Net periodic pension cost: Service cost $ 64 $ 560 $ 638 Interest cost 757 859 770 Expected return on plan assets (983 ) (1,153 ) (985 ) Amortization of prior service cost — — 25 Amortization of unrecognized net loss 159 209 479 Net periodic benefit cost $ (3 ) $ 475 $ 927 Assumptions Weighted-average assumptions used to determine benefit obligations at December 31, 2015 , 2014 , and 2013 : 2015 2014 2013 Discount rate 4.17 % 3.83 % 4.75 % Rate of compensation increase N/A 3.00 % 3.00 % Weighted-average assumptions used to determine net periodic cost for years ended December 31, 2015 , 2014 , and 2013 : 2015 2014 2013 Discount rate 3.83 % 4.75 % 4.00 % Expected long-term return on plan assets 7.00 % 8.00 % 8.00 % Rate of compensation increase N/A 3.00 % 3.00 % The expected long-term rate of return was estimated using market benchmarks by which the plan assets would outperform the market value in the future, based on historical experience adjusted for changes in asset allocation and expectations for overall lower future returns on similar investments compared to past periods. Plan Assets The Plan’s weighted-average asset allocations at December 31, 2015 and 2014 by asset category are as follows: Asset Category 2015 2014 Cash 8.56 % 11.54 % Fixed income securities 10.33 % 12.46 % Equity 61.73 % 76.00 % Inflation Hedges/Real Assets 5.03 % — % Hedged Strategies 14.35 % — % Total 100.00 % 100.00 % The investment objective for the Plan is to maximize total return with tolerance for slightly above average risk, meaning the fund is able to tolerate short-term volatility to achieve above-average returns over the long term. Asset allocation favors equities, with target allocation of approximately 62% equity securities, 15.0% fixed income securities, 10% inflation hedges/real assets, 10% hedged strategies, and 2.5% cash. Due to volatility in the market, the target allocation is not always desirable and asset allocations will fluctuate between the acceptable ranges. The equity portfolio’s exposure is primarily in mid and large capitalization domestic equities with limited exposure to small capitalization and international stocks. It is management’s intent to give the investment managers flexibility, within the overall guidelines, with respect to investment decisions and their timing. However, certain investments require specific review and approval by management. Management is also informed of anticipated, significant modifications of any previously approved investment, or anticipated use of derivatives to execute investment strategies. The following table sets forth by level, within the fair value hierarchy detailed in Note 21 - Fair Value Measurements, the Plan’s assets at fair value as of December 31, 2015 and 2014 : 2015 (In Thousands) Level I Level II Level III Total Assets: Cash and cash equivalents $ 1,218 $ — $ — $ 1,218 Mutual funds - taxable fixed income 1,467 — — 1,467 Mutual funds - domestic equity 8,150 — — 8,150 Mutual funds - international equity 631 — — 631 Inflation Hedges/Real Assets 715 — — 715 Hedged Strategies 2,042 — — 2,042 Total assets at fair value $ 14,223 $ — $ — $ 14,223 2014 (In Thousands) Level I Level II Level III Total Assets: Cash and cash equivalents $ 1,606 $ — $ — $ 1,606 Mutual funds - taxable fixed income 1,732 — — 1,732 Mutual funds - domestic equity 8,372 — — 8,372 Mutual funds - international equity 2,196 — — 2,196 Total assets at fair value $ 13,906 $ — $ — $ 13,906 The following future benefit payments that reflect expected future service, as appropriate, are expected to be paid: (In Thousands) 2016 $ 783 2017 799 2018 812 2019 848 2020 882 Thereafter 4,734 $ 8,858 The company expects to contribute a minimum of $500,000 to its Pension Plan in 2016 . 401(k) Savings Plan The Company also offers a 401(k) savings plan in which eligible participating employees may elect to contribute up to a maximum percentage allowable not to exceed the limits of Code Sections 401(k), 404, and 415. The Company may make matching contributions equal to a discretionary percentage that is determined by the Board of Directors. Participants are at all times fully vested in their contributions and vest over a period of five years regarding the employer contribution. Contribution expense was approximately $230,000 , $171,000 , and $132,000 for the years ended December 31, 2015 , 2014 , and 2013 , respectively. Deferred Compensation Plan The Company has a deferred compensation plan whereby participating directors elect to forego directors’ fees paid in cash. Under this plan, the Company will make payments for a ten -year period beginning at the later of age 65 or ceasing to be a director in most cases or at death, if earlier, at which time payments would be made to their designated beneficiaries. To fund benefits under the deferred compensation plan, the Company has acquired bank-owned life insurance policies on the lives of the participating directors for which insurance benefits are payable to the Company. The Company incurred expenses related to the plan of $252,000 , $235,000 , and $169,000 for the years ended December 31, 2015 , 2014 , and 2013 , respectively. Benefits paid under the plan were approximately $103,000 , $88,000 , and $57,000 in 2015 , 2014 , and 2013 , respectively. |
STOCK OPTIONS
STOCK OPTIONS | 12 Months Ended |
Dec. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [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. On August 27, 2015, the Company issued 38,750 stock options to a group of employees. Each option granted has a strike price of $42.03 and is exercisable after five years following the date of the grant of such options. The options expire ten years following the date of the grant of such options. A summary of stock option activity is presented below: 2015 Shares Weighted Average Exercise Price Outstanding, beginning of year — — Granted 38,750 $ 42.03 Exercised — — Forfeited (4,000 ) 42.03 Outstanding, end of year 34,750 $ 42.03 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. The following assumptions were used in determining the fair value of share options granted: 2015 Risk-free interest rate 1.63 % Expected volatility 31.58 % Expected dividend yield 4.22 % Expected life 7.51 years Weighted average grant date fair value per option $ 3.96 For the year ended December 31, 2015, recorded $19,000 in total share-based compensation expense. The compensation expense is recorded as part of the non-interest expenses in the Consolidated Statement of Income. As at December 31, 2015, total unrecognized compensation costs related to non-vested options was $119,000 which is expected to be recognized over a period of 4.66 years. |
EMPLOYEE STOCK PURCHASE PLAN
EMPLOYEE STOCK PURCHASE PLAN | 12 Months Ended |
Dec. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
EMPLOYEE STOCK PURCHASE PLAN | EMPLOYEE STOCK PURCHASE PLAN The Company maintains a Penns Woods Bancorp, Inc. 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. There were 2,335 and 2,720 shares issued under the plan for the years ended December 31, 2015 and 2014 , respectively. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2015 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS Certain directors and executive officers of the Company and the Bank, including their immediate families and companies in which they are principal owners (more than ten percent), are indebted to the Company. Such indebtedness was incurred in the ordinary course of business on the same terms and at those rates prevailing at the time for comparable transactions with others. A summary of loan activity with executive officers, directors, principal shareholders, and associates of such persons is listed below for the years ended December 31, 2015 and 2014 : (In Thousands) Beginning Balance New Loans Repayments Ending Balance 2014 $ 10,955 $ 7,920 $ (9,929 ) $ 8,946 2015 $ 8,946 $ 8,693 $ (8,381 ) $ 9,258 Deposits from related parties held by the Banks amounted to $13,330,000 at December 31, 2015 and $10,703,000 at December 31, 2014 . |
COMMITMENTS AND CONTINGENT LIAB
COMMITMENTS AND CONTINGENT LIABILITIES | 12 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENT LIABILITIES | COMMITMENTS AND CONTINGENT LIABILITIES The following schedule shows future minimum rental payments under operating leases with noncancellable terms in excess of one year as of December 31, 2015 : (In Thousands) 2016 $ 482 2017 429 2018 365 2019 248 2020 228 Thereafter 823 Total $ 2,575 The Company’s operating lease obligations represent short and long-term lease and rental payments for facilities and equipment. Total rental expense for all operating leases for the years ended December 31, 2015 , 2014 , and 2013 were $591,000 , $523,000 and $493,000 . The Company is subject to lawsuits and claims arising out of its business. There are no such legal proceedings or claims currently pending or threatened other than those encountered during the normal course of business. |
OFF-BALANCE SHEET RISK
OFF-BALANCE SHEET RISK | 12 Months Ended |
Dec. 31, 2015 | |
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 include commitments to extend credit and standby letters of credit. 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 December 31, 2015 and 2014 : (In Thousands) 2015 2014 Commitments to extend credit $ 241,936 $ 235,940 Standby letters of credit 4,786 7,490 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. |
CAPITAL REQUIREMENTS
CAPITAL REQUIREMENTS | 12 Months Ended |
Dec. 31, 2015 | |
Banking and Thrift [Abstract] | |
CAPITAL REQUIREMENTS | CAPITAL REQUIREMENTS Federal regulations require the Company and the Banks to maintain minimum amounts of capital. Specifically, each is required to maintain certain minimum dollar amounts and ratios of Common Equity Tier 1, Total, and Tier 1 capital to risk-weighted assets and of Tier 1 capital to average total assets. In addition to the capital requirements, the Federal Deposit Insurance Corporation Improvement Act (“FDICIA”) established five capital categories ranging from “well capitalized” to “critically undercapitalized.” Should any institution fail to meet the requirements to be considered “adequately capitalized,” it would become subject to a series of increasingly restrictive regulatory actions. As of December 31, 2015 and 2014 , the FDIC categorized the Banks as well capitalized under the regulatory framework for prompt corrective action. To be classified as a well capitalized financial institution, common equity tier I risk-based, tier I risked-based, total risk-based, and tier I leverage capital ratios must be at least 6.5% , 8% , 10% , and 5% , respectively. The Company’s and the Banks' actual capital ratios are presented in the following tables, which shows that the Company and both Banks met all regulatory capital requirements. Consolidated Company 2015 2014 (In Thousands) Amount Ratio Amount Ratio Common Equity Tier I Capital (to Risk-weighted Assets) Actual $ 121,665 11.24 % N/A N/A For Capital Adequacy Purposes 48,722 4.50 % N/A N/A To Be Well Capitalized 70,377 6.50 % N/A N/A Total Capital (to Risk-weighted Assets) Actual $ 134,067 12.38 % $ 123,371 12.65 % For Capital Adequacy Purposes 86,617 8.00 % 78,019 8.00 % To Be Well Capitalized 108,272 10.00 % 97,524 10.00 % Tier I Capital (to Risk-weighted Assets) Actual $ 121,665 11.24 % $ 112,290 11.51 % For Capital Adequacy Purposes 64,963 6.00 % 39,010 4.00 % To Be Well Capitalized 86,617 8.00 % 58,514 6.00 % Tier I Capital (to Average Assets) Actual $ 121,665 9.38 % $ 112,290 9.27 % For Capital Adequacy Purposes 51,862 4.00 % 48,476 4.00 % To Be Well Capitalized 64,828 5.00 % 60,595 5.00 % Jersey Shore State Bank 2015 2014 (In Thousands) Amount Ratio Amount Ratio Common Equity Tier I Capital (to Risk-weighted Assets) Actual $ 82,682 10.70 % N/A N/A For Capital Adequacy Purposes 34,773 4.50 % N/A N/A To Be Well Capitalized 50,227 6.50 % N/A N/A Total Capital (to Risk-weighted Assets) Actual $ 92,036 11.91 % $ 83,183 12.30 % For Capital Adequacy Purposes 61,818 8.00 % 54,086 8.00 % To Be Well Capitalized 77,272 10.00 % 67,608 10.00 % Tier I Capital (to Risk-weighted Assets) Actual $ 82,682 10.70 % $ 74,730 11.05 % For Capital Adequacy Purposes 46,363 6.00 % 27,043 4.00 % To Be Well Capitalized 61,818 8.00 % 40,565 6.00 % Tier I Capital (to Average Assets) Actual $ 82,682 8.66 % $ 74,730 8.50 % For Capital Adequacy Purposes 38,175 4.00 % 35,175 4.00 % To Be Well Capitalized 47,719 5.00 % 43,968 5.00 % Luzerne Bank 2015 2014 (In Thousands) Amount Ratio Common Equity Tier I Capital (to Risk-weighted Assets) Actual $ 30,549 10.66 % N/A N/A For Capital Adequacy Purposes 12,901 4.50 % N/A N/A To Be Well Capitalized 18,635 6.50 % N/A N/A Total Capital (to Risk-weighted Assets) Actual $ 33,274 11.61 % $ 29,856 10.23 % For Capital Adequacy Purposes 22,935 8.00 % 23,341 8.00 % To Be Well Capitalized 28,669 10.00 % 29,176 10.00 % Tier I Capital (to Risk-weighted Assets) Actual $ 30,549 10.66 % $ 27,886 9.56 % For Capital Adequacy Purposes 17,201 6.00 % 11,670 4.00 % To Be Well Capitalized 22,935 8.00 % 17,506 6.00 % Tier I Capital (to Average Assets) Actual $ 30,549 8.90 % $ 27,886 8.56 % For Capital Adequacy Purposes 13,725 4.00 % 13,032 4.00 % To Be Well Capitalized 17,157 5.00 % 16,289 5.00 % |
REGULATORY RESTRICTIONS
REGULATORY RESTRICTIONS | 12 Months Ended |
Dec. 31, 2015 | |
Disclosure of Restrictions on Dividends, Loans and Advances Disclosure [Abstract] | |
REGULATORY RESTRICTIONS | REGULATORY RESTRICTIONS The Pennsylvania Banking Code restricts the availability of capital funds for payment of dividends by all state-chartered banks. Accordingly, at December 31, 2015 , the balance in the additional paid in capital account totaling $11,657,000 for JSSB and $42,214,000 for Luzerne Bank is unavailable for dividends. The Banks are subject to regulatory restrictions, which limit the ability to loan funds to Penns Woods Bancorp, Inc. At December 31, 2015 , the regulatory lending limit amounted to approximately $16,985,000 . Cash and Due from Banks Jersey Shore State Bank and Luzerne Bank had no reserve requirements by the district Federal Reserve Bank at December 31, 2015 or 2014 ; however, if they did they would be reported with cash and due from banks. The required reserves are computed by applying prescribed ratios to the classes of average deposit balances. These are held in the form of cash on hand and a balance maintained directly with the Federal Reserve Bank. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2015 | |
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. The three broad levels of pricing observations are as follows: Level I: Quoted prices are available in active markets for identical assets or liabilities as of the reported date. Level II: Pricing inputs are other than quoted prices in active markets, which are either directly or indirectly observable as of the reported date. The nature of these assets and liabilities includes items for which quoted prices are available but traded less frequently, and items that are fair valued using other financial instruments, the parameters of which can be directly observed. Level III: Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. This hierarchy requires the use of observable market data when available. The following table presents the assets reported on the balance sheet at their fair value on a recurring basis as of December 31, 2015 and 2014 , 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. 2015 (In Thousands) Level I Level II Level III Total Assets measured on a recurring basis: Investment securities, available for sale: U.S. Government and agency securities $ — $ 3,549 $ — $ 3,549 Mortgage-backed securities — 10,009 — 10,009 Asset-backed securities — 1,940 — 1,940 State and political securities — 86,555 — 86,555 Other debt securities — 57,772 — 57,772 Financial institution equity securities 11,483 — — 11,483 Other equity securities 4,849 — — 4,849 Investment securities, trading: Financial institution equity securities 73 — — 73 Total assets measured on a recurring basis $ 16,405 $ 159,825 $ — $ 176,230 2014 (In Thousands) Level I Level II Level III Total Assets measured on a recurring basis: Investment securities, available for sale: U.S. Government and agency securities $ — $ 3,841 $ — $ 3,841 Mortgage-backed securities — 12,697 — 12,697 Asset-backed securities — 2,492 — 2,492 State and political securities — 108,116 — 108,116 Other debt securities — 89,463 — 89,463 Financial institution equity securities 9,915 — — 9,915 Other equity securities 5,689 — — 5,689 Total assets measured on a recurring basis $ 15,604 $ 216,609 $ — $ 232,213 The following table presents the assets reported on the balance sheet at their fair value on a non-recurring basis as of December 31, 2015 and 2014 , 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. 2015 (In Thousands) Level I Level II Level III Total Assets measured on a non-recurring basis: Impaired loans $ — $ — $ 13,779 $ 13,779 Other real estate owned — — 1,696 1,696 Total assets measured on a non-recurring basis $ — $ — $ 15,475 $ 15,475 2014 (In Thousands) Level I Level II Level III Total Assets measured on a non-recurring basis: Impaired loans $ — $ — $ 15,483 $ 15,483 Other real estate owned — — 3,241 3,241 Total assets measured on a non-recurring basis $ — $ — $ 18,724 $ 18,724 The following table provides a listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques as of December 31, 2015 and 2014 : 2015 Quantitative Information About Level III Fair Value Measurements (In Thousands) Fair Value Valuation Technique(s) Unobservable Inputs Range Weighted Average Impaired loans $ 5,696 Discounted cash flow Temporary reduction in payment amount 0 to (70)% (17 )% Probability of default —% 8,083 Appraisal of collateral Appraisal adjustments (1) 0 to (20)% (15 )% Other real estate owned $ 1,696 Appraisal of collateral (1) 2014 Quantitative Information About Level III Fair Value Measurements (In Thousands) Fair Value Valuation Technique(s) Unobservable Inputs Range Weighted Average Impaired loans $ 4,749 Discounted cash flow Temporary reduction in payment amount 0 to (91)% (12 )% Probability of default —% 10,734 Appraisal of collateral Appraisal adjustments (1) 0 to (20)% (15 )% Other real estate owned $ 3,241 Appraisal of collateral (1) (1) Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated liquidation expenses. 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. The significant unobservable input used in the fair value measurement of the Company’s impaired loans using the appraisal of collateral valuation technique include appraisal adjustments, which are adjustments to appraisals by management for qualitative factors such as economic conditions and estimated liquidation expenses. The significant unobservable input used in the fair value measurement of the Company’s other real estate owned are the same inputs used to value impaired loans using the appraisal of collateral valuation technique. |
FAIR VALUE OF FINANCIAL INSTRUM
FAIR VALUE OF FINANCIAL INSTRUMENTS | 12 Months Ended |
Dec. 31, 2015 | |
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 fair values 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 values 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, the fair value of financial instruments would not represent the full market value of the Company. The fair values of the Company’s financial instruments are as follows at December 31, 2015 and 2014 : Fair Value Measurements at December 31, 2015 (In Thousands) Carrying Value Fair Value Quoted Prices in Active Markets for Identical Assets (Level I) Significant Other Observable Inputs (Level II) Significant Unobservable Inputs (Level III) Financial assets: Cash and cash equivalents $ 22,796 $ 22,796 $ 22,796 $ — $ — Investment securities: Available for sale 176,157 176,157 16,332 159,825 — Trading 73 73 73 Loans held for sale 757 757 757 — — Loans, net 1,033,163 1,045,140 — — 1,045,140 Bank-owned life insurance 26,667 26,667 26,667 — — Accrued interest receivable 3,686 3,686 3,686 — — Financial liabilities: Interest-bearing deposits $ 751,797 $ 729,685 $ 509,206 $ — $ 220,479 Noninterest-bearing deposits 280,083 280,083 280,083 — — Short-term borrowings 46,638 46,638 46,638 — — Long-term borrowings 91,025 91,783 — — 91,783 Accrued interest payable 426 426 426 — — Fair Value Measurements at December 31, 2014 (In Thousands) Carrying Value Fair Value Quoted Prices in Active Markets for Identical Assets (Level I) Significant Other Observable Inputs (Level II) Significant Unobservable Inputs (Level III) Financial assets: Cash and cash equivalents $ 19,908 $ 19,908 $ 19,908 $ — $ — Investment securities: Available for sale 232,213 232,213 15,604 216,609 — Loans held for sale 550 550 550 — — Loans, net 905,000 916,597 — — 916,597 Bank-owned life insurance 25,959 25,959 25,959 — — Accrued interest receivable 3,912 3,912 3,912 — — Financial liabilities: Interest-bearing deposits $ 738,041 $ 722,724 $ 506,875 $ — $ 215,849 Noninterest-bearing deposits 243,378 243,378 243,378 — — Short-term borrowings 40,818 40,818 40,818 — — Long-term borrowings 71,176 73,084 — — 73,084 Accrued interest payable 381 381 381 — — Cash and Cash Equivalents, Loans Held for Sale, Accrued Interest Receivable, Short-term Borrowings, and Accrued Interest Payable: The fair value is equal to the carrying value. Investment Securities: The fair value of investment securities available for sale is equal to the available quoted market price. If no quoted market price is available, fair value is determined by using the quoted market price for similar securities. Regulatory stocks’ fair value is equal to the carrying value. Loans: Fair values are determined for portfolios of loans with similar financial characteristics. Loans are segregated by type such as commercial, commercial real estate, residential real estate, construction real estate, and other consumer. 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 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. Bank-Owned Life Insurance: The fair value is equal to the cash surrender value of the life insurance policies. Deposits: The fair value of deposits with no stated maturity, such as noninterest-bearing demand deposits, savings, NOW, and money market accounts, is equal to the amount payable on demand as of December 31, 2015 and 2014 . The fair value of certificates of deposit is based on the discounted value of contractual cash flows. The fair values above do not include the benefit that results from the low-cost funding provided by the deposit liabilities compared to the cost of borrowing funds in the market, commonly referred to as the core deposit intangible. 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 fair value of off-balance sheet items at December 31, 2015 and 2014 . The contractual amounts of unfunded commitments and letters of credit are presented in Note 17. |
PARENT COMPANY ONLY FINANCIAL S
PARENT COMPANY ONLY FINANCIAL STATEMENTS | 12 Months Ended |
Dec. 31, 2015 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
PARENT COMPANY ONLY FINANCIAL STATEMENTS | PARENT COMPANY ONLY FINANCIAL STATEMENTS Condensed financial information for Penns Woods Bancorp, Inc. follows: CONDENSED BALANCE SHEET, DECEMBER 31, (In Thousands) 2015 2014 ASSETS: Cash $ 263 $ 1,299 Investment in subsidiaries: Bank 127,126 125,524 Non-bank 8,332 8,900 Other assets 705 380 Total Assets $ 136,426 $ 136,103 LIABILITIES AND SHAREHOLDERS’ EQUITY: Other liabilities $ 147 $ 136 Shareholders’ equity 136,279 135,967 Total liability and shareholders’ equity $ 136,426 $ 136,103 CONDENSED STATEMENT OF INCOME FOR THE YEARS ENDED DECEMBER 31, (In Thousands) 2015 2014 2013 Operating income: Dividends from subsidiaries $ 11,367 $ 10,080 $ 14,836 Security gains — 3 — Equity in undistributed earnings of subsidiaries 3,167 5,261 346 Operating expenses (636 ) (736 ) (1,098 ) Net income $ 13,898 $ 14,608 $ 14,084 Comprehensive income $ 11,766 $ 17,835 $ 3,833 CONDENSED STATEMENT OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, (In Thousands) 2015 2014 2013 OPERATING ACTIVITIES: Net income $ 13,898 $ 14,608 $ 14,084 Adjustments to reconcile net income to net cash provided by operating activities: Equity in undistributed earnings of subsidiaries (3,167 ) (5,261 ) (346 ) Other, net (313 ) (50 ) 97 Net cash provided by operating activities 10,418 9,297 13,835 INVESTING ACTIVITIES: Outlays for business acquisitions — — (2,876 ) FINANCING ACTIVITIES: Dividends paid (8,967 ) (9,055 ) (9,560 ) Issuance of common stock 116 118 80 Purchase of treasury stock (2,603 ) (747 ) — Net cash used for financing activities (11,454 ) (9,684 ) (9,480 ) NET (DECREASE) INCREASE IN CASH (1,036 ) (387 ) 1,479 CASH, BEGINNING OF YEAR 1,299 1,686 207 CASH, END OF YEAR $ 263 $ 1,299 $ 1,686 |
CONSOLIDATED QUARTERLY FINANCIA
CONSOLIDATED QUARTERLY FINANCIAL DATA (UNAUDITED) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |
CONSOLIDATED QUARTERLY FINANCIAL DATA (UNAUDITED) | CONSOLIDATED QUARTERLY FINANCIAL DATA (UNAUDITED) (In Thousands, Except Per Share Data) For the Three Months Ended 2015 March 31, June 30, Sept. 30, Dec. 31, Interest income $ 11,397 $ 11,529 $ 11,523 $ 11,675 Interest expense 1,286 1,307 1,289 1,337 Net interest income 10,111 10,222 10,234 10,338 Provision for loan losses 700 600 520 480 Non-interest income, excluding securities gains 2,599 2,535 2,644 2,417 Securities gains (losses), net 661 522 493 894 Non-interest expense 8,468 8,421 8,530 8,317 Income before income tax provision 4,203 4,258 4,321 4,852 Income tax provision 848 825 957 1,106 Net income $ 3,355 $ 3,433 $ 3,364 $ 3,746 Earnings per share - basic and diluted $ 0.70 $ 0.72 $ 0.71 $ 0.79 (In Thousands, Except Per Share Data) For the Three Months Ended 2014 March 31, June 30, Sept. 30, Dec. 31, Interest income $ 11,329 $ 11,357 $ 11,460 $ 11,460 Interest expense 1,242 1,226 1,242 1,252 Net interest income 10,087 10,131 10,218 10,208 Provision for loan losses 485 300 460 1,605 Non-interest income, excluding securities gains 2,818 2,442 2,779 2,954 Securities gains (losses), net 393 487 2,145 490 Non-interest expense 8,643 8,422 8,313 8,512 Income before income tax provision 4,170 4,338 6,369 3,535 Income tax provision 701 875 1,576 652 Net income $ 3,469 $ 3,463 $ 4,793 $ 2,883 Earnings per share - basic and diluted $ 0.72 $ 0.72 $ 0.99 $ 0.60 |
ACQUISITION OF LUZERNE NATIONAL
ACQUISITION OF LUZERNE NATIONAL BANK CORPORATION | 12 Months Ended |
Dec. 31, 2015 | |
Business Combinations [Abstract] | |
ACQUISITION OF LUZERNE NATIONAL BANK CORPORATION | ACQUISITION OF LUZERNE NATIONAL BANK CORPORATION On June 1, 2013, the Company closed on a merger transaction pursuant to which Penns Woods Bancorp, Inc. acquired Luzerne National Bank Corporation in a stock and cash transaction. The acquisition extended the Company’s footprint into Luzerne and Lackawanna Counties, Pennsylvania. Luzerne National Bank Corporation was the holding company for Luzerne Bank, a Pennsylvania bank that conducted its business from a main office in Luzerne, Pennsylvania with eight branch offices in Luzerne County and one loan production office in Lackawanna County, all in northeastern Pennsylvania. Since June 1, 2013, the loan production office in Lackawanna County has been closed. Under the terms of the merger agreement, the Company acquired all of the outstanding shares of Luzerne National Bank Corporation for a total purchase price of approximately $42,612,000 . As a result of the acquisition, the Company issued 978,977 common shares, or 20.62% of the total shares outstanding as of December 31, 2015 , to former shareholders of Luzerne National Bank Corporation. Luzerne Bank is operating as an independent bank under the Penns Woods Bancorp, Inc. umbrella. The acquired assets and assumed liabilities were measured at estimated fair values. Management made significant estimates and exercised significant judgment in accounting for the acquisition. Management measured loan fair values based on loan file reviews, appraised collateral values, expected cash flows, and historical loss factors of Luzerne Bank. Real estate acquired through foreclosure was primarily valued based on appraised collateral values. The Company also recorded an identifiable intangible asset representing the core deposit base of Luzerne Bank based on management’s evaluation of the cost of such deposits relative to alternative funding sources. The Company also recorded an identifiable intangible asset representing the trade name of Luzerne Bank based on management’s evaluation of the value of the name in the market. Management used significant estimates including the average lives of depository accounts, future interest rate levels, and the cost of servicing various depository products. Management used market quotations to determine the fair value of investment securities. The business combination resulted in the acquisition of loans with and without evidence of credit quality deterioration. Luzerne Bank’s loans were deemed impaired at the acquisition date if the Company did not expect to receive all contractually required cash flows due to concerns about credit quality. Such loans were fair valued and the difference between contractually required payments at the acquisition date and cash flows expected to be collected was recorded as a non-accretable difference. At the acquisition date, the Company recorded $1,211,000 of purchased credit-impaired loans subject to a non-accretable difference of $842,000 . The method of measuring carrying value of purchased loans differs from loans originated by the Company (originated loans), and as such, the Company identifies purchased loans and purchased loans with a credit quality discount and originated loans at amortized cost. Luzerne’s loans without evidence of credit deterioration were fair valued by discounting both expected principal and interest cash flows using an observable discount rate for similar instruments that a market participant would consider in determining fair value. Additionally, consideration was given to management’s best estimates of default rates and payment speeds. At acquisition, Luzerne’s loan portfolio without evidence of deterioration totaled $249,789,000 and was recorded at a fair value of $249,500,000 . The following table summarizes the purchase of Luzerne National Bank Corporation as of June 1, 2013: (In Thousands, Except Per Share Data) Purchase Price Consideration in Common Stock Luzerne National Bank Corporation common shares settled for stock 630,216 Exchange Ratio 1.5534 Penns Woods Bancorp, Inc. shares issued 978,977 Value assigned to Penns Woods Bancorp, Inc. common share $ 40.59 Purchase price assigned to Luzerne National Bank Corporation common shares exchanged for Penns Woods Bancorp, Inc. $ 39,736 Purchase Price Consideration - Cash for Common Stock Luzerne National Bank Corporation shares exchanged for cash 46,480 Purchase price paid to each Luzerne National Bank Corporation common share exchanged for cash $ 61.86 Purchase price assigned to Luzerne National Bank Corporation common shares exchanged for cash 2,876 Total Purchase Price 42,612 Net Assets Acquired: Luzerne National Bank Corporation shareholders’ equity $ 27,371 Adjustments to reflect assets acquired at fair value: Investments 33 Loans Interest rate 2,680 General credit (3,206 ) Specific credit - non-amortizing (58 ) Specific credit - amortizing (40 ) Core deposit intangible 1,882 Trade name intangible 133 Owned premises 1,138 Leased premises contracts 122 Deferred tax assets (603 ) Adjustments to reflect liabilities acquired at fair value: Time deposits (912 ) 28,540 Goodwill resulting from merger $ 14,072 Results of operations for Luzerne National Bank Corporation prior to the acquisition date are not included in the Consolidated Statement of Income. Due to the significant amount of fair value adjustments, historical results of Luzerne National Bank Corporation are not relevant to the Company’s results of operations. Therefore, no pro forma information is presented. |
OPERATIONS AND SUMMARY OF SIG34
OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts of Penns Woods Bancorp, Inc. and its wholly owned subsidiaries, Jersey Shore State Bank (“JSSB”), Luzerne Bank ("Luzerne" collectively with JSSB "Banks"), Woods Real Estate Development Co., Inc., Woods Investment Company, Inc., and The M Group Inc. D/B/A The Comprehensive Financial Group (“The M Group”), a wholly owned subsidiary of JSSB, (collectively, the “Company”). All significant intercompany balances and transactions have been eliminated. |
Use of Estimates | Use of Estimates The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from those estimates. Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan losses, valuation of net deferred tax assets, impairment of goodwill, other than temporary impairment of debt and equity securities, fair value of financial instruments, and the valuation of real estate acquired through, or in lieu of, foreclosure on settlement of debt. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents include cash on hand and in banks and federal funds sold. Interest-earning deposits mature within 90 days and are carried at cost. Net cash flows are reported for loan, deposit, and short-term borrowing transactions. |
Restrictions on Cash and Cash Equivalents | Restrictions on Cash and Cash Equivalents Based on deposit levels, the Banks must maintain cash and other reserves with the Federal Reserve Bank of Philadelphia (FRB). |
Investment Securities | Investment Securities Investment securities are classified at the time of purchase, based on management’s intention and ability, as securities held to maturity, securities available for sale, or securities held for trading. Debt securities acquired with the intent and ability to hold to maturity are stated at cost, adjusted for amortization of premium and accretion of discount, which are computed using the interest method and recognized as adjustments of interest income. Certain other debt securities have been classified as available for sale to serve principally as a source of liquidity. Unrealized holding gains and losses for available for sale securities are reported as a separate component of shareholders’ equity, net of tax, until realized. Unrealized holding gains and losses for equity securities held for trading are recognized as a separate component within the income statement. Realized security gains and losses are computed using the specific identification method for debt securities and the average cost method for marketable equity securities. Interest and dividends on investment securities are recognized as income when earned. Securities are periodically reviewed for other-than-temporary impairment based upon a number of factors, including, but not limited to, the length of time and extent to which the fair value has been less than cost, the financial condition of the underlying issuer, the ability of the issuer to meet contractual obligations, the likelihood of the security’s ability to recover any decline in its fair value, whether it is more likely than not that the Company would be required to sell the security before its anticipated recovery in fair value, and a review of the Company’s capital adequacy, interest rate risk position, and liquidity. The assessment of a security’s ability to recover any decline in fair value, the ability of the issuer to meet contractual obligations, and management’s intent and ability requires considerable judgment. A decline in value that is considered to be other-than-temporary is recorded as a loss within non-interest income in the Consolidated Statement of Income. Investment securities fair values are based on observed market prices. Certain investment securities do not have observed bid prices and their fair value is based on instruments with similar risk elements. Since regulatory stock is redeemable at par, the Company carries it a |
Loans | Loans Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff generally are stated at the principal amount outstanding, net of deferred fees and discounts, unamortized loan fees and costs, and the allowance for loan losses. Interest on loans is recognized as income when earned on the accrual method. The Company’s general policy has been to stop accruing interest on loans when it is determined a reasonable doubt exists as to the collectability of additional interest. Income is subsequently recognized only to the extent that cash payments are received provided the loan is not delinquent in payment and, in management’s judgment, the borrower has the ability and intent to make future principal payments. Otherwise, payments are applied to the unpaid principal balance of the loan. Loans are restored to accrual status if certain conditions are met, including but not limited to, the repayment of all unpaid interest and scheduled principal due, ongoing performance consistent with the contractual agreement, and the future expectation of continued, timely payments. Loan origination and commitment fees as well as certain direct loan origination costs are being deferred and amortized as an adjustment to the related loan’s yield over the contractual lives of the related loans. |
Allowance for Loan Losses | Allowance for Loan Losses The allowance for loan losses represents the amount which management estimates is adequate to provide for probable losses inherent in its loan portfolio, as of the Consolidated Balance Sheet date. The allowance method is used in providing for loan losses. Accordingly, all loan losses are charged to the allowance and all recoveries are credited to it. The allowance for loan losses is established through a provision for loan losses charged to operations. The provision for loan losses is based upon management’s quarterly review of the loan portfolio. The purpose of the review is to assess loan quality, identify impaired loans, analyze delinquencies, ascertain loan growth, evaluate potential charge-offs and recoveries, and assess general economic conditions in the markets served. An external independent loan review is also performed annually for the Bank. Management remains committed to an aggressive program of problem loan identification and resolution. The allowance is calculated by applying loss factors to outstanding loans by type, excluding loans for which a specific allowance has been determined. Loss factors are based on management’s consideration of the nature of the portfolio segments, changes in mix and volume of the loan portfolio, historical loan loss experience, and general economic conditions. In addition, management considers industry standards and trends with respect to nonperforming loans and its knowledge and experience with specific lending segments. Although management believes that it uses the best information available to make such determinations and that the allowance for loan losses is adequate at December 31, 2015, future adjustments could be necessary if circumstances or economic conditions differ substantially from the assumptions used in making the initial determinations. A downturn in the local economy, rising unemployment, or negative performance trends in financial information from borrowers could be indicators of subsequent increased levels of nonperforming assets and possible charge-offs, which would normally require increased loan loss provisions. An integral part of the periodic regulatory examination process is the review of the adequacy of the Banks' loan loss allowance. The regulatory agencies could require the Banks, based on their evaluation of information available at the time of their examination, to provide additional loan loss provisions to further supplement the allowance. Impaired loans are commercial and commercial real estate 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 “nonaccrual loans,” although the two categories overlap. The Banks may choose to place a loan on nonaccrual status due to payment delinquency or uncertain collectability, while not classifying the loan as impaired if the loan is not a commercial or commercial real estate loan. 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 loans. When foreclosure is probable, impairment is measured based on the fair value of the collateral. 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. 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. |
Loan Charge-off Policies | Loan Charge-off Policies Loans are generally fully or partially charged down to the fair value of collateral securing the asset when: • management judges the asset to be uncollectible; • repayment is deemed to be protracted beyond reasonable time frames; • the asset has been classified as a loss by either the internal loan review process or external examiners; • the borrower has filed bankruptcy and the loss becomes evident due to a lack of assets; or • the loan is 180 days past due unless both well secured and in the process of collection. |
Troubled Debt Restructurings | Troubled Debt Restructurings In situations where, for economic or legal reasons related to a borrower’s financial difficulties, management may grant a concession for other than an insignificant period of time to the borrower that would not otherwise be considered, the related loan is classified as a troubled debt restructuring (TDR). Management strives to identify borrowers in financial difficulty early and work with them to modify to more affordable terms before their loan reaches nonaccrual status. These modified terms may include rate reductions, principal forgiveness, payment forbearance, and other actions intended to minimize the economic loss and to avoid foreclosure or repossession of the collateral. In cases where borrowers are granted new terms that provide for a reduction of either interest or principal, management measures any impairment on the restructuring as noted above for impaired loans. In addition to the allowance for the pooled portfolios, management has developed a separate allowance for loans that are identified as impaired through a TDR. These loans are excluded from pooled loss forecasts and a separate reserve is provided under the accounting guidance for loan impairment. Consumer loans whose terms have been modified in a TDR are also individually analyzed for estimated impairment. |
Loans Held for Sale | Loans Held for Sale In general, fixed rate residential mortgage loans originated by the Banks are held for sale and are carried at cost due to their short holding period, which can range from less than two weeks to a maximum of thirty days. Sold loans are not serviced by the Banks. Proceeds from the sale of loans in excess of the carrying value are accounted for as a gain. Total gains on the sale of loans are shown as a component of non-interest income within the Consolidated Statement of Income. |
Foreclosed Assets | Foreclosed Assets Foreclosed assets are carried at the lower of cost or fair value less estimated selling costs. Prior to foreclosure, the value of the underlying loan is written down to the fair value of the real estate to be acquired by a charge to the allowance for loan losses, if necessary. Any subsequent write-downs are charged against operating expenses. Net operating expenses and gains and losses realized from disposition are included in non-interest expense and income, respectively, within the Consolidated Statement of Income. |
Premises and Equipment | Premises and Equipment Land is carried at cost. Premises and equipment are stated at cost less accumulated depreciation. Depreciation is computed using straight-line and accelerated methods over the estimated useful lives of the related assets, which range from five to ten years for furniture, fixtures, and equipment and fifteen to forty years for buildings and improvements. Costs incurred for routine maintenance and repairs are charged to operations as incurred. Costs of major additions and improvements are capitalized. |
Bank-Owned Life Insurance | Bank-Owned Life Insurance The Company has purchased life insurance policies on certain officers and directors. Bank-owned life insurance is recorded at its cash surrender value, or the amount that can be realized. Increases in the cash surrender value are recognized as a component of non-interest income within the Consolidated Statement of Income. |
Goodwill | Goodwill The Company performs an annual impairment analysis of goodwill for its purchased subsidiaries, Luzerne and The M Group. |
Intangible Assets | Intangible Assets At December 31, 2015 , the Company had intangible assets of $1,240,000 as a result of the acquisition of Luzerne National Bank Corporation, which is net of accumulated amortization of $774,000 . These intangible assets will continue to be amortized using the sum-of-the-years digits method of amortization over ten years. |
Investments in Limited Partnerships | Investments in Limited Partnerships The Company is a limited partner in four partnerships at December 31, 2015 that provide low income elderly housing in the Company’s geographic market area. The carrying value of the Company’s investments in limited partnerships was $ 899,000 at December 31, 2015 and $1,560,000 at December 31, 2014 . The investments are being amortized over the ten -year tax credit receipt period utilizing the straight-line method. |
Off-Balance Sheet Financial Instruments | Off-Balance Sheet Financial Instruments In the ordinary course of business, the Company enters into off-balance sheet financial instruments. Those instruments consist of commitments to extend credit and standby letters of credit. When those instruments are funded or become payable, the Company reports the amounts in its financial statements. |
Marketing Cost | Marketing Cost Marketing costs are generally expensed as incurred. |
Income Taxes | Income Taxes The Company prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Benefits from tax positions should be recognized in the financial statements only when it is more likely than not that the tax position will be sustained upon examination by the appropriate taxing authority that would have full knowledge of all relevant information. A tax position that meets the more-likely-than-not recognition threshold is measured at the largest amount of benefit that is greater than fifty percent likely of being realized upon ultimate settlement. Tax positions that previously failed to meet the more-likely-than-not recognition threshold should be recognized in the first subsequent financial reporting period in which that threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not recognition threshold should be derecognized in the first subsequent financial reporting period in which that threshold is no longer met. Deferred tax assets and liabilities result from temporary differences in financial and income tax methods of accounting, and are reflected at currently enacted income tax rates applicable to the period in which the deferred tax assets or liabilities are expected to be realized or settled. As changes in tax laws or rates are enacted, deferred tax assets and liabilities are adjusted through the provision for income taxes. The Company analyzed its deferred tax asset position and determined that there was not a need for a valuation allowance due to the Company’s ability to generate future ordinary and capital taxable income. The Company when applicable recognizes interest and penalties on income taxes as a component of income tax provision. |
Earnings Per Share | Earnings Per Share The Company provides dual presentation of basic and diluted earnings per share. Basic earnings per share is calculated utilizing net income as reported in the numerator and weighted average shares outstanding in the denominator. The computation of diluted earnings per share differs in that the dilutive effects of any stock options are adjusted in the denominator. |
Employee Benefits | Employee Benefits Pension and employee benefits include contributions, determined actuarially, to a defined benefit retirement plan covering the eligible employees of JSSB. The plan is funded on a current basis to the extent that it is deductible under existing federal tax regulations. Pension and other employee benefits also include contributions to a defined contribution Section 401(k) plan covering eligible employees. Contributions matching those made by eligible employees are funded throughout the year. In addition, an elective contribution may be made annually at the discretion of the board of directors for the employees of JSSB with contributions being made in 2015 and 2014. |
The M Group Products and Income Recognition | The M Group Products and Income Recognition The M Group product line is comprised primarily of annuities, life insurance, and mutual funds. The revenues generated from life insurance sales are commission only, as The M Group does not underwrite the policies. Life insurance sales include permanent and term policies with the majority of the policies written being permanent. Term life insurance policies are written for 10 , 15 , 20 , and 30 year terms with the majority of the policies being written for 20 years. None of these products are offered as an integral part of lending activities. Commissions from the sale of annuities are recognized at the time notice is received from the third party broker/dealer or an insurance company that the transaction has been accepted and approved, which is also the time when commission income is received. Life insurance commissions are recognized at varying points based on the payment option chosen by the customer. Commissions from monthly and annual payment plans are recognized at the start of each annual period for the life insurance, while quarterly and semi-annual premium payments are recognized quarterly and semi-annually when the earnings process is complete. For example, semi-annual payments on the first of January and July would result in commission income recognition on the first of January and July, while payments on the first of January, April, July, and October would result in commission income recognition on those dates. The potential for chargebacks only exists for those policies on a monthly payment plan since income is recognized at the beginning of the annual coverage period versus at the time of each monthly payment. No liability is maintained for chargebacks as these are removed from income at the time of the occurrence. |
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) The Company is required to present accumulated other comprehensive income (loss) in a full set of general-purpose financial statements for all periods presented. Accumulated other comprehensive income (loss) is comprised of unrealized holding gains (losses) on the available for sale securities portfolio and the unrecognized components of net periodic benefit costs of the defined benefit pension plan. |
Segment Reporting | Segment Reporting The Company has determined that its only reportable segment is Community Banking. |
Reclassification of Comparative Amounts | Reclassification of Comparative Amounts Certain items previously reported have been reclassified to conform to the current year’s reporting format. Such reclassifications did not affect net income or shareholders’ equity. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In January 2014, FASB issued ASU 2014-01, Investments - Equity Method and Joint Ventures (Topic 323): Accounting for Investments in Qualified Affordable Housing Projects. The amendments in this update permit reporting entities to make an accounting policy election to account for their investments in qualified affordable housing projects using the proportional amortization method if certain conditions are met. Under the proportional amortization method, an entity amortizes the initial cost of the investment in proportion to the tax credits and other tax benefits received and recognizes the net investment performance in the income statement as a component of income tax expense (benefit). The amendments in this update should be applied retrospectively to all periods presented. A reporting entity that uses the effective yield method to account for its investments in qualified affordable housing projects before the date of adoption may continue to apply the effective yield method for those preexisting investments. The amendments in this update are effective for public business entities for annual periods and interim reporting periods within those annual periods, beginning after December 15, 2014. Early adoption is permitted. This ASU did not have an impact on the Company’s financial statements. In January 2014, the FASB issued ASU 2014-04, Receivables - Troubled Debt Restructurings by Creditors (Subtopic 310-40): Reclassification of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure. The amendments in this update clarify that an in substance repossession or foreclosure occurs, and a creditor is considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan, upon either (1) the creditor obtaining legal title to the residential real estate property upon completion of a foreclosure or (2) the borrower conveying all interest in the residential real estate property to the creditor to satisfy that loan through completion of a deed in lieu of foreclosure or through a similar legal agreement. Additionally, the amendments require interim and annual disclosure of both (1) the amount of foreclosed residential real estate property held by the creditor, and (2) the recorded investment in consumer mortgage loans collateralized by residential real estate property that are in the process of foreclosure according to local requirements of the applicable jurisdiction. The amendments in this update are effective for public business entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2014. An entity can elect to adopt the amendments in this update using either a modified retrospective transition method or a prospective transition method. The Company has provided the necessary disclosures in Note 6. Loan Credit Quality and Related Allowance for Loan Losses. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (a new revenue recognition standard). The update’s core principle is that a company will recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, this update specifies the accounting for certain costs to obtain or fulfill a contract with a customer and expands disclosure requirements for revenue recognition. This update is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. The Company is currently evaluating the impact the adoption of the standard will have on the Company’s financial position or results of operations. In June 2014, the FASB issued ASU 2014-11, Transfers and Servicing (Topic 860): Repurchase-to-Maturity Transactions, Repurchase Financings, and Disclosures . The amendments in this update change the accounting for repurchase-to-maturity transactions to secured borrowing accounting. For repurchase financing arrangements, the amendments require separate accounting for a transfer of a financial asset executed contemporaneously with a repurchase agreement with the same counterparty, which will result in secured borrowing accounting for the repurchase agreement. The amendments also require enhanced disclosures. The accounting changes in this update are effective for the first interim or annual period beginning after December 15, 2014. An entity is required to present changes in accounting for transactions outstanding on the effective date as a cumulative-effect adjustment to retained earnings as of the beginning of the period of adoption. Earlier application is prohibited. The disclosure for certain transactions accounted for as a sale is required to be presented for interim and annual periods beginning after December 15, 2014, and the disclosure for repurchase agreements, securities lending transactions, and repurchase-to-maturity transactions accounted for as secured borrowings is required to be presented for annual periods beginning after December 15, 2014, and for interim periods beginning after March 15, 2015. The disclosures are not required to be presented for comparative periods before the effective date. This update did not have an impact on the Company’s financial statements. In June 2014, the FASB issued ASU 2014-12, Compensation-Stock Compensation (Topic 718): Accounting for Share-Based Payments when the Terms of an Award Provide that a Performance Target Could Be Achieved After the Requisite Service Period . The amendments require that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. The amendments in this update are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. Entities may apply the amendments in this update either (a) prospectively to all awards granted or modified after the effective date or (b) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. If retrospective transition is adopted, the cumulative effect of applying this update as of the beginning of the earliest annual period presented in the financial statements should be recognized as an adjustment to the opening retained earnings balance at that date. Additionally, if retrospective transition is adopted, an entity may use hindsight in measuring and recognizing the compensation cost. This ASU did not have a significant impact on the Company’s financial statements. In August 2014, the FASB issued ASU 2014-14, Receivables - Troubled Debt Restructurings by Creditors (Subtopic 310-40) . The amendments in this update require that a mortgage loan be de-recognized and that a separate other receivable be recognized upon foreclosure if the following conditions are met: (1) the loan has a government guarantee that is not separable from the loan before foreclosure, (2) at the time of foreclosure, the creditor has the intent to convey the real estate property to the guarantor and make a claim on the guarantee, and the creditor has the ability to recover under that claim, and (3) at the time of foreclosure, any amount of the claim that is determined on the basis of the fair value of the real estate is fixed. Upon foreclosure, the separate other receivable should be measured based on the amount of the loan balance (principal and interest) expected to be recovered from the guarantor. The amendments in this update are effective for public business entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2014. This ASU did not have a significant impact on the Company’s financial statements. In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40) . The amendments in this update provide guidance in accounting principles generally accepted in the United States of America about management's responsibility to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern and to provide related footnote disclosures. The amendments in this update are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. This ASU is not expected to have a significant impact on the Company’s financial statements. In November 2014, the FASB issued ASU 2014-17, Business Combinations (Topic 805): Pushdown Accounting. The amendments in this update apply to the separate financial statements of an acquired entity and its subsidiaries that are a business or nonprofit activity (either public or nonpublic) upon the occurrence of an event in which an acquirer (an individual or an entity) obtains control of the acquired entity. An acquired entity may elect the option to apply pushdown accounting in the reporting period in which the change-in-control event occurs. If pushdown accounting is not applied in the reporting period in which the change-in-control event occurs, an acquired entity will have the option to elect to apply pushdown accounting in a subsequent reporting period to the acquired entity's most recent change-in-control event. The amendments in this update are effective on November 18, 2014. After the effective date, an acquired entity can make an election to apply the guidance to future change-in-control events or to its most recent change-in-control event. This update will not have an impact on the Company’s financial statements. In January 2015, the FASB issued ASU 2015-01, Income Statement -Extraordinary and Unusual Items, as part of its initiative to reduce complexity in accounting standards. This update eliminates from GAAP the concept of extraordinary items. The amendments in this update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015. A reporting entity may apply the amendments prospectively. A reporting entity also may apply the amendments retrospectively to all prior periods presented in the financial statements. Early adoption is permitted provided that the guidance is applied from the beginning of the fiscal year of adoption. This update is not expected to have a significant impact on the Company’s financial statements. In February 2015, the FASB issued ASU 2015-02, Consolidation (Topic 810) . The amendments in this update affect reporting entities that are required to evaluate whether they should consolidate certain legal entities. All legal entities are subject to reevaluation under the revised consolidation model. Specifically, the amendments (1) Modify the evaluation of whether limited partnerships and similar legal entities are variable interest entities (VIEs) or voting interest entities; (2) Eliminate the presumption that a general partner should consolidate a limited partnership; (3) Affect the consolidation analysis of reporting entities that are involved with VIEs, particularly those that have fee arrangements and related party relationships; (4) Provide a scope exception from consolidation guidance for reporting entities with interests in legal entities that are required to comply with or operate in accordance with requirements that are similar to those in Rule 2a-7 of the Investment Company Act of 1940 for registered money market funds. The amendments in this update are effective for public business entities for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2015. The Company is currently evaluating the impact the adoption of the standard will have on the Company’s financial position or results of operations. In April 2015, the FASB issued ASU 2015-03, Interest-Imputation of Interest (Subtopic 835-30) , as part of its initiative to reduce complexity in accounting standards. To simplify presentation of debt issuance costs, the amendments in this update require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in this update. For public business entities, the amendments in this update are effective for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. An entity should apply the new guidance on a retrospective basis, wherein the balance sheet of each individual period presented should be adjusted to reflect the period-specific effects of applying the new guidance. This update is not expected to have a significant impact on the Company’s financial statements. In April 2015, the FASB issued ASU 2015-04, Compensation-Retirement Benefits (Topic 715) , as part of its initiative to reduce complexity in accounting standards. For an entity with a fiscal year-end that does not coincide with a month-end, the amendments in this update provide a practical expedient that permits the entity to measure defined benefit plan assets and obligations using the month-end that is closest to the entity's fiscal year-end and apply that practical expedient consistently from year to year. The practical expedient should be applied consistently to all plans if an entity has more than one plan. The amendments in this update are effective for public business entities for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. Earlier application is permitted. This update is not expected to have a significant impact on the Company’s financial statements. In April 2015, the FASB issued ASU 2015-05, Intangible - Goodwill and Other Internal Use Software (Topic 350-40) , as part of its initiative to reduce complexity in accounting standards. This guidance will help entities evaluate the accounting for fees paid by a customer in a cloud computing arrangement. The amendments in this update provide guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, then the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. For public business entities, the Board decided that the amendments will be effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2015. Early adoption is permitted for all entities. This update is not expected to have a significant impact on the Company’s financial statements. In May 2015, the FASB issued ASU 2015-07, Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent) . The update applies to reporting entities that elect to measure the fair value of an investment using the net asset value per share (or its equivalent) practical expedient. Under the amendments in this update, investments for which fair value is measured at net asset value per share (or its equivalent) using the practical expedient should not be categorized in the fair value hierarchy. Removing those investments from the fair value hierarchy not only eliminates the diversity in practice resulting from the way in which investments measured at net asset value per share (or its equivalent) with future redemption dates are classified, but also ensures that all investments categorized in the fair value hierarchy are classified using a consistent approach. Investments that calculate net asset value per share (or its equivalent), but for which the practical expedient is not applied will continue to be included in the fair value hierarchy. A reporting entity should continue to disclose information on investments for which fair value is measured at net asset value (or its equivalent) as a practical expedient to help users understand the nature and risks of the investments and whether the investments, if sold, are probable of being sold at amounts different from net asset value. The amendments in this update are effective for public business entities for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. For all other entities, the amendments in this update are effective for fiscal years beginning after December 15, 2016, and interim periods within those fiscal years. A reporting entity should apply the amendments retrospectively to all periods presented. The retrospective approach requires that an investment for which fair value is measured using the net asset value per share practical expedient be removed from the fair value hierarchy in all periods presented in an entity's financial statements. Earlier application is permitted. This update is not expected to have a significant impact on the Company’s financial statements. In May 2015, the FASB issued ASU 2015-08, Business Combinations - Pushdown Accounting - Amendment to SEC Paragraphs Pursuant to Staff Accounting Bulletin No. 115 . This ASU was issued to amend various SEC paragraphs pursuant to the issuance of Staff Accounting Bulletin No. 115. This update is not expected to have a significant impact on the Company’s financial statements. In June 2015, the FASB issued ASU 2015-10, Technical Corrections and Improvements . The amendments in this update represent changes to clarify the Codification, correct unintended application of guidance, or make minor improvements to the Codification that are not expected to have a significant effect on current accounting practice or create a significant administrative cost to most entities. Transition guidance varies based on the amendments in this update. The amendments in this update that require transition guidance are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015. Early adoption is permitted, including adoption in an interim period. All other amendments will be effective upon the issuance of this update. This update is not expected to have a significant impact on the Company’s financial statements. In August 2015, the FASB issued ASU 2015-14, Revenue from Contract with Customers (Topic 606) . The amendments in this update defer the effective date of ASU 2014-09 for all entities by one year. Public business entities, certain not-for-profit entities, and certain employee benefit plans should apply the guidance in ASU 2014-09 to annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. The Company is evaluating the effect of adopting this new accounting update. In August 2015, the FASB issued ASU 2015-15, Interest-Imputation of Interest (Subtopic 835-30) Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements Amendments to SEC Paragraphs Pursuant to Staff Announcement at June 18, 2015 EITF Meeting . This ASU adds SEC paragraphs pursuant to the SEC Staff Announcement at the June 18, 2015 Emerging Issues Task Force meeting about the presentation and subsequent measurement of debt issuance costs associated with line-of-credit arrangements. This update is not expected to have a significant impact on the Company’s financial statements. In September 2015, the FASB issued ASU 2015-16, Business Combinations (Topic 805) . The amendments in this update require that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The amendments in this update require that the acquirer record, in the same period's financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. The amendments in this update require an entity to present separately on the face of the income statement or disclose in the notes the portion of the amount recorded in current-period earnings by line item that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date. For public business entities, the amendments in this update are effective for fiscal years beginning after December 15, 2015, including interim periods within those fiscal years. This update is not expected to have a significant impact on the Company’s financial statements. In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes . The amendments in this Update require that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. The amendments in this Update apply to all entities that present a classified statement of financial position. For public business entities, the amendments in this Update are effective for financial statements issued for annual periods beginning after December 15, 2016, and interim periods within those annual periods. For all other entities, the amendments in this Update are effective for financial statements issued for annual periods beginning after December 15, 2017, and interim periods within annual periods beginning after December 15, 2018. Earlier application is permitted for all entities as of the beginning of an interim or annual reporting period. The amendments in this Update may be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. This Update is not expected to have a significant impact on the Company’s financial statements. In January 2016, the FASB issued ASU 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities . This Update applies to all entities that hold financial assets or owe financial liabilities and is intended to provide more useful information on the recognition, measurement, presentation, and disclosure of financial instruments. Among other things, this Update (a) requires equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income; (b) simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment; (c) eliminates the requirement to disclose the fair value of financial instruments measured at amortized cost for entities that are not public business entities; (d) eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet; (e) requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; (f) requires an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments; (g) requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset (that is, securities or loans and receivables) on the balance sheet or the accompanying notes to the financial statements; and (h) clarifies that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets. For public business entities, the amendments in this Update are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. For all other entities including not-for-profit entities and employee benefit plans within the scope of Topics 960 through 965 on plan accounting, the amendments in this Update are effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019. All entities that are not public business entities may adopt the amendments in this Update earlier as of the fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. 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 COMPREHENSI35
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | The changes in accumulated other comprehensive income (loss) by component shown net of tax as of December 31, 2015 and 2014 were as follows: Twelve Months Ended December 31, 2015 Twelve Months Ended December 31, 2014 (In Thousands) Net Unrealized Gain (Loss) on Available Defined Benefit Plan Total Net Unrealized Gain (Loss) on Available Defined Total Beginning balance $ 2,930 $ (4,597 ) $ (1,667 ) $ (2,169 ) $ (2,725 ) $ (4,894 ) Other comprehensive (loss) income before reclassifications (962 ) 435 (527 ) 7,419 (2,010 ) 5,409 Amounts reclassified from accumulated other comprehensive (loss) income (1,710 ) 105 (1,605 ) (2,320 ) 138 (2,182 ) Net current-period other comprehensive income (loss) (2,672 ) 540 (2,132 ) 5,099 (1,872 ) 3,227 Ending balance $ 258 $ (4,057 ) $ (3,799 ) $ 2,930 $ (4,597 ) $ (1,667 ) |
Reclassification out of Accumulated Other Comprehensive Income | The reclassifications out of accumulated other comprehensive income as of December 31, 2015 and 2014 were as follows: (In Thousands) Amount Reclassified from Accumulated Other Comprehensive Income Details about Accumulated Other Comprehensive Income Components Twelve Months Ended Affected Line Item in the Consolidated Statement of Income December 31, 2015 December 31, 2014 Net realized gain on available for sale securities $ (2,592 ) $ (3,515 ) Securities gains, net Income tax effect 882 1,195 Income tax provision (1,710 ) (2,320 ) Net of tax Net unrecognized pension costs 159 209 Salaries and employee benefits Income tax effect (54 ) (71 ) Income tax provision $ 105 $ 138 Net of tax |
PER SHARE DATA (Tables)
PER SHARE DATA (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |
Schedule of weighted average common shares (denominator) used in the basic and dilutive earnings per share computation | The following table sets forth the composition of the weighted average common shares (denominator) used in the basic and dilutive per share computation. Year Ended December 31, 2015 2014 2013 Weighted average common shares issued 5,003,691 5,001,171 4,591,222 Average treasury stock shares (231,452 ) (185,022 ) (180,596 ) Weighted average common shares used to calculate basic and diluted earnings per share 4,772,239 4,816,149 4,410,626 |
INVESTMENT SECURITIES (Tables)
INVESTMENT SECURITIES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of amortized cost and fair values of investment securities | The amortized cost and fair values of investment securities at December 31, 2015 and 2014 are as follows: 2015 (In Thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Available for sale (AFS) U.S. Government and agency securities $ 3,586 $ — $ (37 ) $ 3,549 Mortgage-backed securities 9,785 284 (60 ) 10,009 Asset-backed securities 1,960 — (20 ) 1,940 State and political securities 84,992 1,797 (234 ) 86,555 Other debt securities 59,832 185 (2,245 ) 57,772 Total debt securities 160,155 2,266 (2,596 ) 159,825 Financial institution equity securities 10,397 1,100 (14 ) 11,483 Other equity securities 5,214 70 (435 ) 4,849 Total equity securities 15,611 1,170 (449 ) 16,332 Total investment securities AFS $ 175,766 $ 3,436 $ (3,045 ) $ 176,157 2014 (In Thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Available for sale (AFS) U.S. Government and agency securities $ 3,953 $ — $ (112 ) $ 3,841 Mortgage-backed securities 12,240 485 (28 ) 12,697 Asset-backed securities 2,468 27 (3 ) 2,492 State and political securities 104,820 3,885 (589 ) 108,116 Other debt securities 89,736 1,026 (1,299 ) 89,463 Total debt securities 213,217 5,423 (2,031 ) 216,609 Financial institution equity securities 8,823 1,110 (18 ) 9,915 Other equity securities 5,733 84 (128 ) 5,689 Total equity securities 14,556 1,194 (146 ) 15,604 Total investment securities AFS $ 227,773 $ 6,617 $ (2,177 ) $ 232,213 |
Trading securities | The amortized cost and fair values of trading investment securities at December 31, 2015 are as follows. There were no trading securities at December 31, 2014. 2015 (In Thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Trading Financial institution equity securities $ 78 $ — $ (5 ) $ 73 Total trading securities $ 78 $ — $ (5 ) $ 73 |
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 securities have been in a continuous unrealized loss position, at December 31, 2015 and 2014 . 2015 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) U.S. Government and agency securities $ — $ — $ 3,549 $ (37 ) $ 3,549 $ (37 ) Mortgage-backed securities 6,081 (60 ) — — 6,081 (60 ) Asset-backed securities 1,626 (16 ) 314 (4 ) 1,940 (20 ) State and political securities 7,345 (47 ) 1,656 (187 ) 9,001 (234 ) Other debt securities 24,381 (530 ) 22,547 (1,715 ) 46,928 (2,245 ) Total debt securities 39,433 (653 ) 28,066 (1,943 ) 67,499 (2,596 ) Financial institution equity securities — — 53 (14 ) 53 (14 ) Other equity securities 2,363 (277 ) 1,001 (158 ) 3,364 (435 ) Total equity securities 2,363 (277 ) 1,054 (172 ) 3,417 (449 ) Total Investment Securities AFS $ 41,796 $ (930 ) $ 29,120 $ (2,115 ) $ 70,916 $ (3,045 ) 2014 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) U.S. Government and agency securities $ — $ — $ 3,841 $ (112 ) $ 3,841 $ (112 ) Mortgage-backed securities 6,741 (28 ) — — 6,741 (28 ) Asset-backed securities — — 519 (3 ) 519 (3 ) State and political securities 8,243 (14 ) 6,382 (575 ) 14,625 (589 ) Other debt securities 23,174 (718 ) 29,266 (581 ) 52,440 (1,299 ) Total debt securities 38,158 (760 ) 40,008 (1,271 ) 78,166 (2,031 ) Financial institution equity securities 407 (18 ) — — 407 (18 ) Other equity securities 1,837 (100 ) 773 (28 ) 2,610 (128 ) Total equity securities 2,244 (118 ) 773 (28 ) 3,017 (146 ) Total Investment Securities AFS $ 40,402 $ (878 ) $ 40,781 $ (1,299 ) $ 81,183 $ (2,177 ) |
Schedule of amortized cost and fair value of debt securities by contractual maturity | The amortized cost and fair value of debt securities at December 31, 2015 , 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 $ 1,835 $ 1,843 Due after one year to five years 32,085 31,926 Due after five years to ten years 88,554 87,311 Due after ten years 37,681 38,745 Total $ 160,155 $ 159,825 |
Schedule of gross realized gains and losses | The following table represents gross realized gains and losses on those transactions: Year Ended December 31, (In Thousands) 2015 2014 2013 Gross realized gains: U.S. Government and agency securities $ — $ 59 $ — Mortgage-backed securities — 89 — State and political securities 1,571 2,327 2,076 Other debt securities 825 622 490 Financial institution equity securities 183 710 241 Other equity securities 132 491 340 Total gross realized gains $ 2,711 $ 4,298 $ 3,147 Gross realized losses: U.S. Government and agency securities $ — $ 45 $ — Mortgage-backed securities — — 92 State and political securities 22 412 611 Other debt securities 54 209 27 Financial institution equity securities — — — Other equity securities 43 117 — Total gross realized losses $ 119 $ 783 $ 730 |
LOAN CREDIT QUALITY AND RELAT38
LOAN CREDIT QUALITY AND RELATED ALLOWANCE FOR LOAN LOSSES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
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 December 31, 2015 and 2014 : 2015 (In Thousands) Current Past Due 30 To 89 Days Past Due 90 & Still Accruing Non-Accrual Total Commercial, financial, and agricultural $ 162,312 $ 164 $ — $ 1,596 $ 164,072 Real estate mortgage: Residential 517,753 6,827 714 889 526,183 Commercial 295,784 720 265 5,770 302,539 Construction 26,545 67 — 212 26,824 Installment loans to individuals 26,572 429 — — 27,001 1,028,966 $ 8,207 $ 979 $ 8,467 1,046,619 Net deferred loan fees and discounts (1,412 ) (1,412 ) Allowance for loan losses (12,044 ) (12,044 ) Loans, net $ 1,015,510 $ 1,033,163 2014 (In Thousands) Current Past Due 30 To 89 Days Past Due 90 & Still Accruing Non-Accrual Total Commercial, financial, and agricultural $ 122,624 $ 773 $ — $ 759 $ 124,156 Real estate mortgage: Residential 450,503 6,078 332 847 457,760 Commercial 279,731 1,819 54 9,744 291,348 Construction 21,485 — — 511 21,996 Installment loans to individuals 21,125 383 1 — 21,509 895,468 $ 9,053 $ 387 $ 11,861 916,769 Net deferred loan fees and discounts (1,190 ) (1,190 ) Allowance for loan losses (10,579 ) (10,579 ) Loans, net $ 883,699 $ 905,000 |
Schedule of components of the purchase accounting adjustments related to the purchased impaired loans acquired in the Luzerne acquisition | The table below presents the components of the purchase accounting adjustments related to the purchased impaired loans acquired in the Luzerne acquisition as of June 1, 2013: (In Thousands) June 1, 2013 Unpaid principal balance $ 1,211 Interest 572 Contractual cash flows 1,783 Non-accretable discount (842 ) Expected cash flows 941 Accretable discount (63 ) Estimated fair value $ 878 |
Schedule of accretable discount on loans acquired with deteriorated credit quality | Changes in the amortizable yield for purchased credit-impaired loans were as follows for the twelve months ended December 31, 2014 (In Thousands) December 31, 2014 Balance at beginning of period $ 35 Accretion (35 ) Balance at end of period $ — |
Schedule of additional information regarding loans acquired and accounted | The following table presents additional information regarding loans acquired with specific evidence of deterioration in credit quality under ASC 310-30: (In Thousands) December 31, 2015 December 31, 2014 Outstanding balance $ 441 $ 449 Carrying amount 341 349 |
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 the 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 as of December 31, 2015 , 2014 , and 2013 : Year Ended December 31, 2015 2014 2013 (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 Interest Income That Would Have Been Recorded Based on Original Term and Rate Interest Income Recorded on a Cash Basis Commercial, financial, and agricultural $ 48 $ 53 $ 42 $ 33 $ 7 $ 3 Real estate mortgage: Residential 53 38 63 34 41 20 Commercial 281 54 600 264 447 251 Construction 16 — 63 2 88 56 $ 398 $ 145 $ 768 $ 333 $ 583 $ 330 |
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 December 31, 2015 and 2014 : 2015 (In Thousands) Recorded Investment Unpaid Principal Balance Related Allowance With no related allowance recorded: Commercial, financial, and agricultural $ 319 $ 319 $ — Real estate mortgage: Residential 1,142 1,142 — Commercial 1,735 1,785 — Construction 212 212 — 3,408 3,458 — With an allowance recorded: Commercial, financial, and agricultural 150 150 75 Real estate mortgage: Residential 1,573 1,703 376 Commercial 10,752 10,752 1,653 Construction — — — 12,475 12,605 2,104 Total: Commercial, financial, and agricultural 469 469 75 Real estate mortgage: Residential 2,715 2,845 376 Commercial 12,487 12,537 1,653 Construction 212 212 — $ 15,883 $ 16,063 $ 2,104 2014 (In Thousands) Recorded Investment Unpaid Principal Balance Related Allowance With no related allowance recorded: Commercial, financial, and agricultural $ 439 $ 439 $ — Real estate mortgage: Residential 139 139 — Commercial 3,228 3,228 — Construction 716 716 — 4,522 4,522 — With an allowance recorded: Commercial, financial, and agricultural 673 673 298 Real estate mortgage: Residential 1,327 1,449 147 Commercial 10,745 10,889 1,581 Construction 309 309 67 13,054 13,320 2,093 Total: Commercial, financial, and agricultural 1,112 1,112 298 Real estate mortgage: Residential 1,466 1,588 147 Commercial 13,973 14,117 1,581 Construction 1,025 1,025 67 $ 17,576 $ 17,842 $ 2,093 |
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 December 31, 2015 , 2014 , and 2013 : 2015 (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 Commercial, financial, and agricultural $ 1,031 $ 21 $ 10 Real estate mortgage: Residential 2,570 72 47 Commercial 17,529 342 80 Construction 865 1 53 $ 21,995 $ 436 $ 190 2014 (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 Commercial, financial, and agricultural $ 763 $ 26 $ 25 Real estate mortgage: Residential 1,245 46 20 Commercial 10,987 130 101 Construction 1,086 17 89 $ 14,081 $ 219 $ 235 2013 (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 Commercial, financial, and agricultural $ 538 $ 26 $ — Real estate mortgage: Residential 1,581 62 25 Commercial 8,605 183 95 Construction 2,651 1 569 $ 13,375 $ 272 $ 689 |
Schedule of loan modifications that are considered TDRs | Loan modifications that are considered TDRs completed during the twelve months ended December 31, 2015 and 2014 were as follows: Year Ended December 31, 2015 2014 (In Thousands, Except Number of Contracts) Number of Contracts Pre-Modification Outstanding Recorded Investment Post-Modification Outstanding Recorded Investment Number of Contracts Pre-Modification Outstanding Recorded Investment Post-Modification Outstanding Recorded Investment Commercial, financial, and agricultural 4 $ 213 $ 213 3 $ 620 $ 620 Real estate mortgage: Residential 11 962 962 3 392 392 Commercial 6 1,013 1,013 3 636 636 Construction 1 398 398 — — — Total 22 $ 2,586 $ 2,586 9 $ 1,648 $ 1,648 Of the twenty-two new troubled debt restructurings granted for the year ended December 31, 2015, seven loans totaling $1,008,000 were granted payment concessions, four loans totaling $183,000 were granted term concessions, two loans totaling $287,000 were granted rate concessions, and nine loans totaling 1,108,000 were granted concessions due to other default. Of the nine new troubled debt restructurings granted for the year ended December 31, 2014, five loans totaling $1,142,000 were granted term concessions, three loans totaling $288,000 were granted payment concessions, and one loan totaling 218,000 was granted a rate concession. Loan modifications considered troubled debt restructurings made during the twelve months previous to December 31, 2015, that have defaulted during the twelve month period ending December 31, 2015 were as follows: Year Ended December 31, 2015 (In Thousands, Except Number of Contracts) Number of Contracts Recorded Investment Commercial, financial, and agricultural 1 $ 106 Real estate mortgage: Residential 6 374 Commercial 1 242 Total 8 $ 722 |
Schedule of credit quality categories | The following table presents the credit quality categories identified above as of December 31, 2015 and 2014 : 2015 Commercial and Real Estate Mortgages Installment Loans (In Thousands) Agricultural Residential Commercial Construction to Individuals Totals Pass $ 160,734 $ 522,853 $ 277,248 $ 26,612 $ 27,001 $ 1,014,448 Special Mention 1,669 823 8,625 — — 11,117 Substandard 1,669 2,507 16,666 212 — 21,054 Total $ 164,072 $ 526,183 $ 302,539 $ 26,824 $ 27,001 $ 1,046,619 2014 Commercial and Real Estate Mortgages Installment Loans (In Thousands) Agricultural Residential Commercial Construction to Individuals Totals Pass $ 118,210 $ 454,885 $ 256,444 $ 20,927 $ 21,509 $ 871,975 Special Mention 3,186 2,384 16,262 445 — 22,277 Substandard 2,760 491 18,642 624 — 22,517 Total $ 124,156 $ 457,760 $ 291,348 $ 21,996 $ 21,509 $ 916,769 |
Schedule of activity in the allowance | Activity in the allowance is presented for the twelve months ended December 31, 2015 and 2014 : 2015 Commercial and Agricultural Real Estate Mortgages Installment Loans to Individual (In Thousands) Residential Commercial Construction Unallocated Totals Beginning Balance $ 1,124 $ 3,755 $ 4,205 $ 786 $ 245 $ 464 $ 10,579 Charge-offs (283 ) (49 ) (743 ) (46 ) (240 ) — (1,361 ) Recoveries 176 81 182 23 64 — 526 Provision 515 1,329 573 (603 ) 174 312 2,300 Ending Balance $ 1,532 $ 5,116 $ 4,217 $ 160 $ 243 $ 776 $ 12,044 2014 Commercial and Agricultural Real Estate Mortgages Installment Loans to Individuals (In Thousands) Residential Commercial Construction Unallocated Totals Beginning Balance $ 474 $ 3,917 $ 4,079 $ 741 $ 139 $ 794 $ 10,144 Charge-offs (289 ) (65 ) (2,038 ) — (142 ) — (2,534 ) Recoveries 18 15 — 22 64 — 119 Provision 921 (112 ) 2,164 23 184 (330 ) 2,850 Ending Balance $ 1,124 $ 3,755 $ 4,205 $ 786 $ 245 $ 464 $ 10,579 |
Schedule of concentration of loan | The Company has a concentration of loans at December 31, 2015 and 2014 as follows: 2015 2014 Owners of residential rental properties 16.21 % 16.01 % Owners of commercial rental properties 14.22 % 14.67 % |
Schedule of allowance for loan losses and the recorded investment in loans by portfolio segment and 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 and based on impairment method as of December 31, 2015 and 2014 : 2015 Commercial and Agricultural Real Estate Mortgages Installment Loans to Individuals Unallocated Totals (In Thousands) Residential Commercial Construction Allowance for Loan Losses: Ending allowance balance attributable to loans: Individually evaluated for impairment $ 75 $ 376 $ 1,653 $ — $ — $ — $ 2,104 Collectively evaluated for impairment 1,457 4,740 2,564 160 243 776 9,940 Total ending allowance balance $ 1,532 $ 5,116 $ 4,217 $ 160 $ 243 $ 776 $ 12,044 Loans: Individually evaluated for impairment $ 469 $ 2,374 $ 12,487 $ 212 $ — $ 15,542 Loans acquired with deteriorated credit quality — 341 — — — 341 Collectively evaluated for impairment 163,603 523,468 290,052 26,612 27,001 1,030,736 Total ending loans balance $ 164,072 $ 526,183 $ 302,539 $ 26,824 $ 27,001 $ 1,046,619 2014 Commercial and Agricultural Real Estate Mortgages Installment Loans to Individuals (In Thousands) Residential Commercial Construction Unallocated Totals Allowance for Loan Losses: Ending allowance balance attributable to loans: Individually evaluated for impairment $ 298 $ 147 $ 1,581 $ 67 $ — $ — $ 2,093 Collectively evaluated for impairment 826 3,608 2,624 719 245 464 8,486 Total ending allowance balance $ 1,124 3,755 $ 4,205 $ 786 $ 245 $ 464 $ 10,579 Loans: Individually evaluated for impairment $ 1,112 $ 1,117 $ 13,973 $ 1,025 $ — $ 17,227 Loans acquired with deteriorated credit quality — 349 — — — 349 Collectively evaluated for impairment 123,044 456,294 277,375 20,971 21,509 899,193 Total ending loans balance $ 124,156 457,760 $ 291,348 $ 21,996 $ 21,509 $ 916,769 |
PREMISES AND EQUIPMENT (Tables)
PREMISES AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |
Summary of major classifications of premises and equipment | Major classifications of premises and equipment are summarized as follows at December 31, 2015 and 2014 : (In Thousands) 2015 2014 Land $ 5,764 $ 5,759 Premises 16,074 14,767 Furniture and equipment 8,231 7,435 Leasehold improvements 1,462 1,351 Total 31,531 29,312 Less accumulated depreciation and amortization 9,701 8,203 Net premises and equipment $ 21,830 $ 21,109 |
GOODWILL AND OTHER INTANGIBLES
GOODWILL AND OTHER INTANGIBLES GOODWILL AND OTHER INTANGIBLES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | As of December 31, 2015 , the estimated future amortization expense for the core deposit and trade name intangible was: (In Thousands) Core Deposit Intangible Trade Name Intangible Book of Business Intangible 2016 254 18 10 2017 220 15 10 2018 185 13 10 2019 151 11 10 2020 117 8 10 2021 83 6 10 2022 48 4 10 2023 14 1 10 2024 — — 10 2025 — — 2 $ 1,072 $ 76 $ 92 |
TIME DEPOSITS (Tables)
TIME DEPOSITS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Banking and Thrift [Abstract] | |
Schedule of maturities on time deposits of $100,000 or more | At December 31, 2015 , the scheduled maturities on time deposits of $100,000 or more are as follows: (In Thousands) 2015 Three months or less $ 12,006 Three months to six months 5,863 Six months to twelve months 17,036 Over twelve months 71,687 Total $ 106,592 |
Schedule of total time deposit maturities | (In Thousands) 2015 2016 $ 81,010 2017 55,318 2018 51,104 2019 24,796 2020 7,093 Thereafter 2,056 Total $ 221,377 |
SHORT-TERM BORROWINGS (Tables)
SHORT-TERM BORROWINGS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Summary of outstanding balances and related information for short-term borrowings | The outstanding balances and related information for short-term borrowings are summarized as follows at December 31, 2015 , 2014 , and 2013 : (In Thousands) 2015 2014 2013 Repurchase Agreements: Balance at year end $ 18,334 $ 13,987 $ 12,391 Maximum amount outstanding at any month end 18,614 18,801 16,632 Average balance outstanding during the year 15,834 16,350 16,839 Weighted-average interest rate: At year end 0.21 % 0.23 % 0.28 % Paid during the year 0.21 % 0.22 % 0.40 % Overnight: Balance at year end $ 28,304 $ 26,831 $ 14,325 Maximum amount outstanding at any month end 42,760 26,831 21,350 Average balance outstanding during the year 23,075 5,992 5,508 Weighted-average interest rate: At year end 0.43 % 0.27 % 0.25 % Paid during the year 0.36 % 0.30 % 0.31 % |
Schedule of Securities Financing Transactions | The remaining contractual maturity of repurchase agreements in the consolidated balance sheets as of December 31, 2015 and December 31, 2014 is presented in the following tables. 2015 2014 Remaining Contractual Maturity of the Agreements (In Thousands) Overnight and Continuous Overnight and Continuous Repurchase Agreements: U.S. Government and agency securities $ 3,586 $ 3,953 Mortgage-back securities 8,368 4,526 Asset-backed securities 1,960 2,468 State and political securities 8,015 7,070 Other debt securities 2,155 2,218 Total carrying value of collateral pledged $ 24,084 $ 20,235 Total liability recognized for repurchase agreements $ 18,334 $ 13,987 |
LONG-TERM BORROWINGS (Tables)
LONG-TERM BORROWINGS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Schedule of outstanding long-term borrowings with the FHLB by contractual maturities | The following represents outstanding long-term borrowings with the FHLB by contractual maturities at December 31, 2015 and 2014 : (In Thousands) Weighted Average Interest Rate Stated Interest Rate Range Description Maturity 2015 2014 From To 2015 2014 Variable 2015 — % 3.97 % 3.97 % 3.97 % $ — $ 10,000 Variable 2017 4.22 % 4.22 % 4.15 % 4.28 % 20,000 20,000 Variable 2018 3.18 % 3.18 % 3.18 % 3.18 % 10,000 10,000 Total Variable 3.87 % 3.90 % 30,000 40,000 Fixed 2015 — % 6.92 % 6.92 % 6.92 % — 750 Fixed 2016 0.75 % 0.75 % 0.75 % 0.75 % 5,000 5,000 Fixed 2017 0.91 % 0.91 % 0.90 % 0.97 % 25,000 25,000 Fixed 2018 1.13 % — % 1.13 % 1.13 % 2,000 — Fixed 2019 1.55 % — % 1.54 % 1.55 % 7,292 — Fixed 2020 1.70 % — % 1.62 % 1.79 % 18,333 — Fixed 2022 2.04 % — % 2.04 % 2.04 % 3,000 — Total Fixed 1.28 % 1.03 % 60,625 30,750 Total 2.14 % 2.65 % $ 90,625 $ 70,750 |
Schedule of outstanding long-term borrowings with the FHLB by contractual maturities and Weighted-Average Rate | (In Thousands) Year Ending December 31, Amount Weighted Average Rate 2016 5,000 0.75 % 2017 45,000 2.38 % 2018 12,000 2.84 % 2019 7,292 1.55 % Thereafter 21,333 1.75 % $ 90,625 2.14 % |
Schedule of Future Minimum Lease Payments for Capital Leases | (In Thousands) Lease Payment Interest Present Value of Minimum Lease Payment 2016 $ 38 $ 11 $ 27 2017 38 10 28 2018 38 9 29 2019 38 9 29 2020 38 8 30 Thereafter 276 19 257 $ 466 $ 66 $ 400 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Schedule of temporary differences giving rise to the net deferred tax asset position | The following temporary differences gave rise to the net deferred tax asset position at December 31, 2015 and 2014 : (In Thousands) 2015 2014 Deferred tax assets: Allowance for loan losses $ 3,976 $ 3,380 Deferred compensation 1,696 1,579 Defined Pension 1,525 2,172 Deferred Loan fees and discounts 272 256 Investment securities allowance 517 487 Low income housing credit carryforward 1,181 2,034 Capital loss carryforward — 98 Other 1,696 1,578 Total 10,863 11,584 Deferred tax liabilities: Unrealized gain on available for sale securities 133 1,510 Investment security accretion 231 262 Depreciation 478 734 Amortization 1,031 977 Total 1,873 3,483 Deferred tax asset, net $ 8,990 $ 8,101 |
Schedule of provision or benefit for income taxes | The provision or benefit for income taxes is comprised of the following for the year ended December 31, 2015 , 2014 , and 2013 : (In Thousands) 2015 2014 2013 Currently payable $ 3,527 $ 3,680 $ 3,328 Deferred benefit 209 124 123 Total provision $ 3,736 $ 3,804 $ 3,451 |
Schedule of reconciliation between the expected income tax or benefit and the effective income tax rate on income before income tax provision or benefit | A reconciliation between the expected income tax or benefit and the effective income tax rate on income before income tax provision or benefit follows for the year ended December 31, 2015 , 2014 , and 2013 : 2015 2014 2013 (In Thousands) Amount % Amount % Amount % Provision at expected rate $ 5,996 34.00 % $ 6,260 34.00 % $ 5,962 34.00 % (Decrease) increase in tax resulting from: Tax-exempt income (1,492 ) (8.46 ) (1,673 ) (9.09 ) (1,933 ) (11.02 ) Tax credits (737 ) (4.17 ) (737 ) (4.00 ) (737 ) (4.20 ) Other, net (31 ) (0.18 ) (46 ) (0.25 ) 159 0.90 Effective income tax provision and rate $ 3,736 21.19 % $ 3,804 20.66 % $ 3,451 19.68 % |
EMPLOYEE BENEFIT PLANS (Tables)
EMPLOYEE BENEFIT PLANS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract] | |
Schedule of obligation and funded status | The following table sets forth the obligation and funded status as of December 31, 2015 and 2014 : (In Thousands) 2015 2014 Change in benefit obligation: Benefit obligation at beginning of year $ 23,450 $ 18,186 Service cost — 484 Interest cost 757 859 Actuarial gain (144 ) 277 Benefits paid (639 ) (1,660 ) Curtailment gain (3,155 ) — Other, change in actuarial assumptions (1,322 ) 5,304 Benefit obligation at end of year $ 18,947 $ 23,450 Change in plan assets: Fair value of plan assets at beginning of year $ 13,906 $ 14,258 Actual return on plan assets 25 487 Employer contribution 965 850 Benefits paid (704 ) (1,736 ) Adjustment to fair value of plan assets 31 47 Fair value of plan assets at end of year 14,223 13,906 Funded status $ (4,724 ) $ (9,544 ) Accounts recognized on balance sheet as: Total liabilities $ (4,724 ) $ (9,544 ) Amounts not yet recognized as a component of net periodic pension cost: Amounts recognized in accumulated other comprehensive income (loss) consist of: Net loss $ 6,267 $ 6,965 |
Schedule of components of the net periodic benefit cost of the domestic non-contributory defined benefit plan | Components of Net Periodic Cost and Other Amounts Recognized in Other Comprehensive Income (loss) as of December 31, 2015 , 2014 , and 2013 are as follows: (In Thousands) 2015 2014 2013 Net periodic pension cost: Service cost $ 64 $ 560 $ 638 Interest cost 757 859 770 Expected return on plan assets (983 ) (1,153 ) (985 ) Amortization of prior service cost — — 25 Amortization of unrecognized net loss 159 209 479 Net periodic benefit cost $ (3 ) $ 475 $ 927 |
Schedule of weighted-average assumptions used to determine benefit obligations and net periodic cost | Weighted-average assumptions used to determine benefit obligations at December 31, 2015 , 2014 , and 2013 : 2015 2014 2013 Discount rate 4.17 % 3.83 % 4.75 % Rate of compensation increase N/A 3.00 % 3.00 % Weighted-average assumptions used to determine net periodic cost for years ended December 31, 2015 , 2014 , and 2013 : 2015 2014 2013 Discount rate 3.83 % 4.75 % 4.00 % Expected long-term return on plan assets 7.00 % 8.00 % 8.00 % Rate of compensation increase N/A 3.00 % 3.00 % |
Schedule of plan's weighted-average asset allocations by asset category | The Plan’s weighted-average asset allocations at December 31, 2015 and 2014 by asset category are as follows: Asset Category 2015 2014 Cash 8.56 % 11.54 % Fixed income securities 10.33 % 12.46 % Equity 61.73 % 76.00 % Inflation Hedges/Real Assets 5.03 % — % Hedged Strategies 14.35 % — % Total 100.00 % 100.00 % |
Schedule setting forth by level, within the fair value hierarchy the Plan's assets at fair value | The following table sets forth by level, within the fair value hierarchy detailed in Note 21 - Fair Value Measurements, the Plan’s assets at fair value as of December 31, 2015 and 2014 : 2015 (In Thousands) Level I Level II Level III Total Assets: Cash and cash equivalents $ 1,218 $ — $ — $ 1,218 Mutual funds - taxable fixed income 1,467 — — 1,467 Mutual funds - domestic equity 8,150 — — 8,150 Mutual funds - international equity 631 — — 631 Inflation Hedges/Real Assets 715 — — 715 Hedged Strategies 2,042 — — 2,042 Total assets at fair value $ 14,223 $ — $ — $ 14,223 2014 (In Thousands) Level I Level II Level III Total Assets: Cash and cash equivalents $ 1,606 $ — $ — $ 1,606 Mutual funds - taxable fixed income 1,732 — — 1,732 Mutual funds - domestic equity 8,372 — — 8,372 Mutual funds - international equity 2,196 — — 2,196 Total assets at fair value $ 13,906 $ — $ — $ 13,906 |
Schedule of future benefit payments that reflect expected future service, as appropriate, expected to be paid | The following future benefit payments that reflect expected future service, as appropriate, are expected to be paid: (In Thousands) 2016 $ 783 2017 799 2018 812 2019 848 2020 882 Thereafter 4,734 $ 8,858 |
STOCK OPTIONS (Tables)
STOCK OPTIONS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock options activity | A summary of stock option activity is presented below: 2015 Shares Weighted Average Exercise Price Outstanding, beginning of year — — Granted 38,750 $ 42.03 Exercised — — Forfeited (4,000 ) 42.03 Outstanding, end of year 34,750 $ 42.03 |
Stock option valuation assumptions | The following assumptions were used in determining the fair value of share options granted: 2015 Risk-free interest rate 1.63 % Expected volatility 31.58 % Expected dividend yield 4.22 % Expected life 7.51 years Weighted average grant date fair value per option $ 3.96 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Related Party Transactions [Abstract] | |
Summary of loan activity with executive officers, directors, principal shareholders, and associates of such persons | A summary of loan activity with executive officers, directors, principal shareholders, and associates of such persons is listed below for the years ended December 31, 2015 and 2014 : (In Thousands) Beginning Balance New Loans Repayments Ending Balance 2014 $ 10,955 $ 7,920 $ (9,929 ) $ 8,946 2015 $ 8,946 $ 8,693 $ (8,381 ) $ 9,258 |
COMMITMENTS AND CONTINGENT LI48
COMMITMENTS AND CONTINGENT LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of future minimum rental payments under operating leases with noncancellable terms in excess of one year | The following schedule shows future minimum rental payments under operating leases with noncancellable terms in excess of one year as of December 31, 2015 : (In Thousands) 2016 $ 482 2017 429 2018 365 2019 248 2020 228 Thereafter 823 Total $ 2,575 |
OFF-BALANCE SHEET RISK (Tables)
OFF-BALANCE SHEET RISK (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
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 December 31, 2015 and 2014 : (In Thousands) 2015 2014 Commitments to extend credit $ 241,936 $ 235,940 Standby letters of credit 4,786 7,490 |
CAPITAL REQUIREMENTS (Tables)
CAPITAL REQUIREMENTS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Banking and Thrift [Abstract] | |
Schedule of the Company's and the Bank's actual capital ratios showing that both met all regulatory capital requirements | The Company’s and the Banks' actual capital ratios are presented in the following tables, which shows that the Company and both Banks met all regulatory capital requirements. Consolidated Company 2015 2014 (In Thousands) Amount Ratio Amount Ratio Common Equity Tier I Capital (to Risk-weighted Assets) Actual $ 121,665 11.24 % N/A N/A For Capital Adequacy Purposes 48,722 4.50 % N/A N/A To Be Well Capitalized 70,377 6.50 % N/A N/A Total Capital (to Risk-weighted Assets) Actual $ 134,067 12.38 % $ 123,371 12.65 % For Capital Adequacy Purposes 86,617 8.00 % 78,019 8.00 % To Be Well Capitalized 108,272 10.00 % 97,524 10.00 % Tier I Capital (to Risk-weighted Assets) Actual $ 121,665 11.24 % $ 112,290 11.51 % For Capital Adequacy Purposes 64,963 6.00 % 39,010 4.00 % To Be Well Capitalized 86,617 8.00 % 58,514 6.00 % Tier I Capital (to Average Assets) Actual $ 121,665 9.38 % $ 112,290 9.27 % For Capital Adequacy Purposes 51,862 4.00 % 48,476 4.00 % To Be Well Capitalized 64,828 5.00 % 60,595 5.00 % Jersey Shore State Bank 2015 2014 (In Thousands) Amount Ratio Amount Ratio Common Equity Tier I Capital (to Risk-weighted Assets) Actual $ 82,682 10.70 % N/A N/A For Capital Adequacy Purposes 34,773 4.50 % N/A N/A To Be Well Capitalized 50,227 6.50 % N/A N/A Total Capital (to Risk-weighted Assets) Actual $ 92,036 11.91 % $ 83,183 12.30 % For Capital Adequacy Purposes 61,818 8.00 % 54,086 8.00 % To Be Well Capitalized 77,272 10.00 % 67,608 10.00 % Tier I Capital (to Risk-weighted Assets) Actual $ 82,682 10.70 % $ 74,730 11.05 % For Capital Adequacy Purposes 46,363 6.00 % 27,043 4.00 % To Be Well Capitalized 61,818 8.00 % 40,565 6.00 % Tier I Capital (to Average Assets) Actual $ 82,682 8.66 % $ 74,730 8.50 % For Capital Adequacy Purposes 38,175 4.00 % 35,175 4.00 % To Be Well Capitalized 47,719 5.00 % 43,968 5.00 % Luzerne Bank 2015 2014 (In Thousands) Amount Ratio Common Equity Tier I Capital (to Risk-weighted Assets) Actual $ 30,549 10.66 % N/A N/A For Capital Adequacy Purposes 12,901 4.50 % N/A N/A To Be Well Capitalized 18,635 6.50 % N/A N/A Total Capital (to Risk-weighted Assets) Actual $ 33,274 11.61 % $ 29,856 10.23 % For Capital Adequacy Purposes 22,935 8.00 % 23,341 8.00 % To Be Well Capitalized 28,669 10.00 % 29,176 10.00 % Tier I Capital (to Risk-weighted Assets) Actual $ 30,549 10.66 % $ 27,886 9.56 % For Capital Adequacy Purposes 17,201 6.00 % 11,670 4.00 % To Be Well Capitalized 22,935 8.00 % 17,506 6.00 % Tier I Capital (to Average Assets) Actual $ 30,549 8.90 % $ 27,886 8.56 % For Capital Adequacy Purposes 13,725 4.00 % 13,032 4.00 % To Be Well Capitalized 17,157 5.00 % 16,289 5.00 % |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
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 balance sheet at their fair value on a recurring basis as of December 31, 2015 and 2014 , 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. 2015 (In Thousands) Level I Level II Level III Total Assets measured on a recurring basis: Investment securities, available for sale: U.S. Government and agency securities $ — $ 3,549 $ — $ 3,549 Mortgage-backed securities — 10,009 — 10,009 Asset-backed securities — 1,940 — 1,940 State and political securities — 86,555 — 86,555 Other debt securities — 57,772 — 57,772 Financial institution equity securities 11,483 — — 11,483 Other equity securities 4,849 — — 4,849 Investment securities, trading: Financial institution equity securities 73 — — 73 Total assets measured on a recurring basis $ 16,405 $ 159,825 $ — $ 176,230 2014 (In Thousands) Level I Level II Level III Total Assets measured on a recurring basis: Investment securities, available for sale: U.S. Government and agency securities $ — $ 3,841 $ — $ 3,841 Mortgage-backed securities — 12,697 — 12,697 Asset-backed securities — 2,492 — 2,492 State and political securities — 108,116 — 108,116 Other debt securities — 89,463 — 89,463 Financial institution equity securities 9,915 — — 9,915 Other equity securities 5,689 — — 5,689 Total assets measured on a recurring basis $ 15,604 $ 216,609 $ — $ 232,213 |
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 balance sheet at their fair value on a non-recurring basis as of December 31, 2015 and 2014 , 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. 2015 (In Thousands) Level I Level II Level III Total Assets measured on a non-recurring basis: Impaired loans $ — $ — $ 13,779 $ 13,779 Other real estate owned — — 1,696 1,696 Total assets measured on a non-recurring basis $ — $ — $ 15,475 $ 15,475 2014 (In Thousands) Level I Level II Level III Total Assets measured on a non-recurring basis: Impaired loans $ — $ — $ 15,483 $ 15,483 Other real estate owned — — 3,241 3,241 Total assets measured on a non-recurring basis $ — $ — $ 18,724 $ 18,724 |
Schedule of listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | The following table provides a listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques as of December 31, 2015 and 2014 : 2015 Quantitative Information About Level III Fair Value Measurements (In Thousands) Fair Value Valuation Technique(s) Unobservable Inputs Range Weighted Average Impaired loans $ 5,696 Discounted cash flow Temporary reduction in payment amount 0 to (70)% (17 )% Probability of default —% 8,083 Appraisal of collateral Appraisal adjustments (1) 0 to (20)% (15 )% Other real estate owned $ 1,696 Appraisal of collateral (1) 2014 Quantitative Information About Level III Fair Value Measurements (In Thousands) Fair Value Valuation Technique(s) Unobservable Inputs Range Weighted Average Impaired loans $ 4,749 Discounted cash flow Temporary reduction in payment amount 0 to (91)% (12 )% Probability of default —% 10,734 Appraisal of collateral Appraisal adjustments (1) 0 to (20)% (15 )% Other real estate owned $ 3,241 Appraisal of collateral (1) (1) Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated liquidation expenses. |
FAIR VALUE OF FINANCIAL INSTR52
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value Disclosures [Abstract] | |
Schedule of fair values of financial instruments | The fair values of the Company’s financial instruments are as follows at December 31, 2015 and 2014 : Fair Value Measurements at December 31, 2015 (In Thousands) Carrying Value Fair Value Quoted Prices in Active Markets for Identical Assets (Level I) Significant Other Observable Inputs (Level II) Significant Unobservable Inputs (Level III) Financial assets: Cash and cash equivalents $ 22,796 $ 22,796 $ 22,796 $ — $ — Investment securities: Available for sale 176,157 176,157 16,332 159,825 — Trading 73 73 73 Loans held for sale 757 757 757 — — Loans, net 1,033,163 1,045,140 — — 1,045,140 Bank-owned life insurance 26,667 26,667 26,667 — — Accrued interest receivable 3,686 3,686 3,686 — — Financial liabilities: Interest-bearing deposits $ 751,797 $ 729,685 $ 509,206 $ — $ 220,479 Noninterest-bearing deposits 280,083 280,083 280,083 — — Short-term borrowings 46,638 46,638 46,638 — — Long-term borrowings 91,025 91,783 — — 91,783 Accrued interest payable 426 426 426 — — Fair Value Measurements at December 31, 2014 (In Thousands) Carrying Value Fair Value Quoted Prices in Active Markets for Identical Assets (Level I) Significant Other Observable Inputs (Level II) Significant Unobservable Inputs (Level III) Financial assets: Cash and cash equivalents $ 19,908 $ 19,908 $ 19,908 $ — $ — Investment securities: Available for sale 232,213 232,213 15,604 216,609 — Loans held for sale 550 550 550 — — Loans, net 905,000 916,597 — — 916,597 Bank-owned life insurance 25,959 25,959 25,959 — — Accrued interest receivable 3,912 3,912 3,912 — — Financial liabilities: Interest-bearing deposits $ 738,041 $ 722,724 $ 506,875 $ — $ 215,849 Noninterest-bearing deposits 243,378 243,378 243,378 — — Short-term borrowings 40,818 40,818 40,818 — — Long-term borrowings 71,176 73,084 — — 73,084 Accrued interest payable 381 381 381 — — |
PARENT COMPANY ONLY FINANCIAL53
PARENT COMPANY ONLY FINANCIAL STATEMENTS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Condensed Balance Sheet | CONDENSED BALANCE SHEET, DECEMBER 31, (In Thousands) 2015 2014 ASSETS: Cash $ 263 $ 1,299 Investment in subsidiaries: Bank 127,126 125,524 Non-bank 8,332 8,900 Other assets 705 380 Total Assets $ 136,426 $ 136,103 LIABILITIES AND SHAREHOLDERS’ EQUITY: Other liabilities $ 147 $ 136 Shareholders’ equity 136,279 135,967 Total liability and shareholders’ equity $ 136,426 $ 136,103 |
Condensed Income Statement | CONDENSED STATEMENT OF INCOME FOR THE YEARS ENDED DECEMBER 31, (In Thousands) 2015 2014 2013 Operating income: Dividends from subsidiaries $ 11,367 $ 10,080 $ 14,836 Security gains — 3 — Equity in undistributed earnings of subsidiaries 3,167 5,261 346 Operating expenses (636 ) (736 ) (1,098 ) Net income $ 13,898 $ 14,608 $ 14,084 Comprehensive income $ 11,766 $ 17,835 $ 3,833 |
Condensed Cash Flow Statement | CONDENSED STATEMENT OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, (In Thousands) 2015 2014 2013 OPERATING ACTIVITIES: Net income $ 13,898 $ 14,608 $ 14,084 Adjustments to reconcile net income to net cash provided by operating activities: Equity in undistributed earnings of subsidiaries (3,167 ) (5,261 ) (346 ) Other, net (313 ) (50 ) 97 Net cash provided by operating activities 10,418 9,297 13,835 INVESTING ACTIVITIES: Outlays for business acquisitions — — (2,876 ) FINANCING ACTIVITIES: Dividends paid (8,967 ) (9,055 ) (9,560 ) Issuance of common stock 116 118 80 Purchase of treasury stock (2,603 ) (747 ) — Net cash used for financing activities (11,454 ) (9,684 ) (9,480 ) NET (DECREASE) INCREASE IN CASH (1,036 ) (387 ) 1,479 CASH, BEGINNING OF YEAR 1,299 1,686 207 CASH, END OF YEAR $ 263 $ 1,299 $ 1,686 |
CONSOLIDATED QUARTERLY FINANC54
CONSOLIDATED QUARTERLY FINANCIAL DATA (UNAUDITED) (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of consolidated quarterly financial data | (In Thousands, Except Per Share Data) For the Three Months Ended 2015 March 31, June 30, Sept. 30, Dec. 31, Interest income $ 11,397 $ 11,529 $ 11,523 $ 11,675 Interest expense 1,286 1,307 1,289 1,337 Net interest income 10,111 10,222 10,234 10,338 Provision for loan losses 700 600 520 480 Non-interest income, excluding securities gains 2,599 2,535 2,644 2,417 Securities gains (losses), net 661 522 493 894 Non-interest expense 8,468 8,421 8,530 8,317 Income before income tax provision 4,203 4,258 4,321 4,852 Income tax provision 848 825 957 1,106 Net income $ 3,355 $ 3,433 $ 3,364 $ 3,746 Earnings per share - basic and diluted $ 0.70 $ 0.72 $ 0.71 $ 0.79 (In Thousands, Except Per Share Data) For the Three Months Ended 2014 March 31, June 30, Sept. 30, Dec. 31, Interest income $ 11,329 $ 11,357 $ 11,460 $ 11,460 Interest expense 1,242 1,226 1,242 1,252 Net interest income 10,087 10,131 10,218 10,208 Provision for loan losses 485 300 460 1,605 Non-interest income, excluding securities gains 2,818 2,442 2,779 2,954 Securities gains (losses), net 393 487 2,145 490 Non-interest expense 8,643 8,422 8,313 8,512 Income before income tax provision 4,170 4,338 6,369 3,535 Income tax provision 701 875 1,576 652 Net income $ 3,469 $ 3,463 $ 4,793 $ 2,883 Earnings per share - basic and diluted $ 0.72 $ 0.72 $ 0.99 $ 0.60 |
ACQUISITION OF LUZERNE NATION55
ACQUISITION OF LUZERNE NATIONAL BANK CORPORATION (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Business Combinations [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | (In Thousands, Except Per Share Data) Purchase Price Consideration in Common Stock Luzerne National Bank Corporation common shares settled for stock 630,216 Exchange Ratio 1.5534 Penns Woods Bancorp, Inc. shares issued 978,977 Value assigned to Penns Woods Bancorp, Inc. common share $ 40.59 Purchase price assigned to Luzerne National Bank Corporation common shares exchanged for Penns Woods Bancorp, Inc. $ 39,736 Purchase Price Consideration - Cash for Common Stock Luzerne National Bank Corporation shares exchanged for cash 46,480 Purchase price paid to each Luzerne National Bank Corporation common share exchanged for cash $ 61.86 Purchase price assigned to Luzerne National Bank Corporation common shares exchanged for cash 2,876 Total Purchase Price 42,612 Net Assets Acquired: Luzerne National Bank Corporation shareholders’ equity $ 27,371 Adjustments to reflect assets acquired at fair value: Investments 33 Loans Interest rate 2,680 General credit (3,206 ) Specific credit - non-amortizing (58 ) Specific credit - amortizing (40 ) Core deposit intangible 1,882 Trade name intangible 133 Owned premises 1,138 Leased premises contracts 122 Deferred tax assets (603 ) Adjustments to reflect liabilities acquired at fair value: Time deposits (912 ) 28,540 Goodwill resulting from merger $ 14,072 |
OPERATIONS AND SUMMARY OF SIG56
OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Nature of Business, Loan Charge-off Policies, and Loans Held for Sale (Details) | 12 Months Ended |
Dec. 31, 2015segmentoffice | |
Accounting Policies [Abstract] | |
Number of offices | office | 23 |
Number of reportable segments | 1 |
Number of operating segments | 1 |
Number of days loan is past due unless both well secured and in process of collection | 180 days |
Minimum | |
Loans held for sale | |
Short holding period for loans held for sale (less than 2 weeks) | 14 days |
Maximum | |
Loans held for sale | |
Short holding period for loans held for sale (less than 2 weeks) | 30 days |
OPERATIONS AND SUMMARY OF SIG57
OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Premises and Equipment, Goodwill, Intangible Assets, and Investments in Limited Partnerships (Details) | 12 Months Ended | ||
Dec. 31, 2015USD ($)partnership | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | |
Premises and equipment | |||
Goodwill impairment loss | $ 0 | $ 0 | $ 0 |
Investment in Limited Partnerships | |||
Number of partnerships held by entity | partnership | 4 | ||
Carrying value of investments in limited partnerships | $ 899,000 | 1,560,000 | |
Tax credit receipt period over which investment in the partnership entered into after 2004 are being fully amortized | 10 years | ||
Amortization of investment in limited partnerships | $ 661,000 | $ 661,000 | $ 661,000 |
Furniture, fixtures, and equipment | Minimum | |||
Premises and equipment | |||
Estimated useful lives (in years) | 5 years | ||
Furniture, fixtures, and equipment | Maximum | |||
Premises and equipment | |||
Estimated useful lives (in years) | 10 years | ||
Buildings and improvements | Minimum | |||
Premises and equipment | |||
Estimated useful lives (in years) | 15 years | ||
Buildings and improvements | Maximum | |||
Premises and equipment | |||
Estimated useful lives (in years) | 40 years | ||
Luzerne National Bank Corporation | |||
Finite-Lived Intangible Assets [Line Items] | |||
Intangible assets net | $ 1,240,000 | ||
Accumulated amortization | $ 774,000 | ||
Useful life (in years) | 10 years |
OPERATIONS AND SUMMARY OF SIG58
OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - The M Group Products and Income Recognition (Details) - The M Group | 12 Months Ended |
Dec. 31, 2015 | |
The M Group products and income recognition | |
Term life insurance policies, term one (in years) | 10 years |
Term life insurance policies, term two (in years) | 15 years |
Term life insurance policies, term three (in years) | 20 years |
Term life insurance policies, term four (in years) | 30 years |
Term for which majority of the term life insurance policies are written (in years) | 20 years |
ACCUMULATED OTHER COMPREHENSI59
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) - Changes in AOCI(L) by Component (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Increase (Decrease) in Stockholders' Equity | ||
Beginning balance | $ (1,667) | $ (4,894) |
Other comprehensive (loss) income before reclassifications | (527) | 5,409 |
Amounts reclassified from accumulated other comprehensive (loss) income | (1,605) | (2,182) |
Net current-period other comprehensive income (loss) | (2,132) | 3,227 |
Ending balance | (3,799) | (1,667) |
Net Unrealized Gain (Loss) on Available for Sale Securities | ||
Increase (Decrease) in Stockholders' Equity | ||
Beginning balance | 2,930 | (2,169) |
Other comprehensive (loss) income before reclassifications | (962) | 7,419 |
Amounts reclassified from accumulated other comprehensive (loss) income | (1,710) | (2,320) |
Net current-period other comprehensive income (loss) | (2,672) | 5,099 |
Ending balance | 258 | 2,930 |
Defined Benefit Plan | ||
Increase (Decrease) in Stockholders' Equity | ||
Beginning balance | (4,597) | (2,725) |
Other comprehensive (loss) income before reclassifications | 435 | (2,010) |
Amounts reclassified from accumulated other comprehensive (loss) income | 105 | 138 |
Net current-period other comprehensive income (loss) | 540 | (1,872) |
Ending balance | $ (4,057) | $ (4,597) |
ACCUMULATED OTHER COMPREHENSI60
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) - Reclassifications out of AOCI(L) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Salaries and employee benefits | $ (17,023) | $ (17,273) | $ (15,415) | ||||||||
Income tax provision | $ (1,106) | $ (957) | $ (825) | $ (848) | $ (652) | $ (1,576) | $ (875) | $ (701) | (3,736) | (3,804) | $ (3,451) |
Amount Reclassified from Accumulated Other Comprehensive Income | Net Unrealized Gain (Loss) on Available for Sale Securities | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Securities gains, net | (2,592) | (3,515) | |||||||||
Income tax provision | 882 | 1,195 | |||||||||
Net of tax | (1,710) | (2,320) | |||||||||
Amount Reclassified from Accumulated Other Comprehensive Income | Defined Benefit Plan | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Salaries and employee benefits | 159 | 209 | |||||||||
Income tax provision | (54) | (71) | |||||||||
Net of tax | $ 105 | $ 138 |
PER SHARE DATA (Details)
PER SHARE DATA (Details) - shares | Aug. 27, 2015 | Sep. 30, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Earnings Per Share [Abstract] | |||||
Weighted average common shares issued | 5,003,691 | 5,001,171 | 4,591,222 | ||
Average treasury stock shares | (231,452) | (185,022) | (180,596) | ||
Weighted average common shares used to calculate basic and diluted earnings per share | 4,772,239 | 4,816,149 | 4,410,626 | ||
Grants in period (in shares) | 38,750 | 38,750 | 38,750 | ||
Options outstanding (in shares) | 34,750 | 0 | 0 |
INVESTMENT SECURITIES - Amortiz
INVESTMENT SECURITIES - Amortized Cost and Fair Values of Investments (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Available for sale (AFS) | ||
Amortized Cost | $ 175,766 | $ 227,773 |
Gross Unrealized Gains | 3,436 | 6,617 |
Gross Unrealized Losses | (3,045) | (2,177) |
Fair Value | 176,157 | 232,213 |
U.S. Government and agency securities | ||
Available for sale (AFS) | ||
Amortized Cost | 3,586 | 3,953 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (37) | (112) |
Fair Value | 3,549 | 3,841 |
Mortgage-backed securities | ||
Available for sale (AFS) | ||
Amortized Cost | 9,785 | 12,240 |
Gross Unrealized Gains | 284 | 485 |
Gross Unrealized Losses | (60) | (28) |
Fair Value | 10,009 | 12,697 |
Asset-backed securities | ||
Available for sale (AFS) | ||
Amortized Cost | 1,960 | 2,468 |
Gross Unrealized Gains | 0 | 27 |
Gross Unrealized Losses | (20) | (3) |
Fair Value | 1,940 | 2,492 |
State and political securities | ||
Available for sale (AFS) | ||
Amortized Cost | 84,992 | 104,820 |
Gross Unrealized Gains | 1,797 | 3,885 |
Gross Unrealized Losses | (234) | (589) |
Fair Value | 86,555 | 108,116 |
Other debt securities | ||
Available for sale (AFS) | ||
Amortized Cost | 59,832 | 89,736 |
Gross Unrealized Gains | 185 | 1,026 |
Gross Unrealized Losses | (2,245) | (1,299) |
Fair Value | 57,772 | 89,463 |
Total debt securities | ||
Available for sale (AFS) | ||
Amortized Cost | 160,155 | 213,217 |
Gross Unrealized Gains | 2,266 | 5,423 |
Gross Unrealized Losses | (2,596) | (2,031) |
Fair Value | 159,825 | 216,609 |
Financial institution equity securities | ||
Available for sale (AFS) | ||
Amortized Cost | 10,397 | 8,823 |
Gross Unrealized Gains | 1,100 | 1,110 |
Gross Unrealized Losses | (14) | (18) |
Fair Value | 11,483 | 9,915 |
Other equity securities | ||
Available for sale (AFS) | ||
Amortized Cost | 5,214 | 5,733 |
Gross Unrealized Gains | 70 | 84 |
Gross Unrealized Losses | (435) | (128) |
Fair Value | 4,849 | 5,689 |
Total equity securities | ||
Available for sale (AFS) | ||
Amortized Cost | 15,611 | 14,556 |
Gross Unrealized Gains | 1,170 | 1,194 |
Gross Unrealized Losses | (449) | (146) |
Fair Value | $ 16,332 | $ 15,604 |
INVESTMENT SECURITIES - Amort63
INVESTMENT SECURITIES - Amortized Cost and Fair Value of Trading Securities (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Amortized Cost | $ 78 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | (5) | |
Fair Value | 73 | $ 0 |
Total equity securities | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Amortized Cost | 78 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | (5) | |
Fair Value | $ 73 |
INVESTMENT SECURITIES - Gross U
INVESTMENT SECURITIES - Gross Unrealized Gains (Losses) and Fair Value by Length of Time (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Investment securities | ||
Fair Value, Less than Twelve Months | $ 41,796 | $ 40,402 |
Gross Unrealized Losses, Less than Twelve Months | (930) | (878) |
Fair value, Twelve Months or Greater | 29,120 | 40,781 |
Gross Unrealized Losses, Twelve Months or Greater | (2,115) | (1,299) |
Fair Value, Total | 70,916 | 81,183 |
Gross Unrealized Losses, Total | (3,045) | (2,177) |
U.S. Government and agency 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 | 3,549 | 3,841 |
Gross Unrealized Losses, Twelve Months or Greater | (37) | (112) |
Fair Value, Total | 3,549 | 3,841 |
Gross Unrealized Losses, Total | (37) | (112) |
Mortgage-backed securities | ||
Investment securities | ||
Fair Value, Less than Twelve Months | 6,081 | 6,741 |
Gross Unrealized Losses, Less than Twelve Months | (60) | (28) |
Fair value, Twelve Months or Greater | 0 | 0 |
Gross Unrealized Losses, Twelve Months or Greater | 0 | 0 |
Fair Value, Total | 6,081 | 6,741 |
Gross Unrealized Losses, Total | (60) | (28) |
Asset-backed securities | ||
Investment securities | ||
Fair Value, Less than Twelve Months | 1,626 | 0 |
Gross Unrealized Losses, Less than Twelve Months | (16) | 0 |
Fair value, Twelve Months or Greater | 314 | 519 |
Gross Unrealized Losses, Twelve Months or Greater | (4) | (3) |
Fair Value, Total | 1,940 | 519 |
Gross Unrealized Losses, Total | (20) | (3) |
State and political securities | ||
Investment securities | ||
Fair Value, Less than Twelve Months | 7,345 | 8,243 |
Gross Unrealized Losses, Less than Twelve Months | (47) | (14) |
Fair value, Twelve Months or Greater | 1,656 | 6,382 |
Gross Unrealized Losses, Twelve Months or Greater | (187) | (575) |
Fair Value, Total | 9,001 | 14,625 |
Gross Unrealized Losses, Total | (234) | (589) |
Other debt securities | ||
Investment securities | ||
Fair Value, Less than Twelve Months | 24,381 | 23,174 |
Gross Unrealized Losses, Less than Twelve Months | (530) | (718) |
Fair value, Twelve Months or Greater | 22,547 | 29,266 |
Gross Unrealized Losses, Twelve Months or Greater | (1,715) | (581) |
Fair Value, Total | 46,928 | 52,440 |
Gross Unrealized Losses, Total | (2,245) | (1,299) |
Total debt securities | ||
Investment securities | ||
Fair Value, Less than Twelve Months | 39,433 | 38,158 |
Gross Unrealized Losses, Less than Twelve Months | (653) | (760) |
Fair value, Twelve Months or Greater | 28,066 | 40,008 |
Gross Unrealized Losses, Twelve Months or Greater | (1,943) | (1,271) |
Fair Value, Total | 67,499 | 78,166 |
Gross Unrealized Losses, Total | (2,596) | (2,031) |
Financial institution equity securities | ||
Investment securities | ||
Fair Value, Less than Twelve Months | 0 | 407 |
Gross Unrealized Losses, Less than Twelve Months | 0 | (18) |
Fair value, Twelve Months or Greater | 53 | 0 |
Gross Unrealized Losses, Twelve Months or Greater | (14) | 0 |
Fair Value, Total | 53 | 407 |
Gross Unrealized Losses, Total | (14) | (18) |
Other equity securities | ||
Investment securities | ||
Fair Value, Less than Twelve Months | 2,363 | 1,837 |
Gross Unrealized Losses, Less than Twelve Months | (277) | (100) |
Fair value, Twelve Months or Greater | 1,001 | 773 |
Gross Unrealized Losses, Twelve Months or Greater | (158) | (28) |
Fair Value, Total | 3,364 | 2,610 |
Gross Unrealized Losses, Total | (435) | (128) |
Total equity securities | ||
Investment securities | ||
Fair Value, Less than Twelve Months | 2,363 | 2,244 |
Gross Unrealized Losses, Less than Twelve Months | (277) | (118) |
Fair value, Twelve Months or Greater | 1,054 | 773 |
Gross Unrealized Losses, Twelve Months or Greater | (172) | (28) |
Fair Value, Total | 3,417 | 3,017 |
Gross Unrealized Losses, Total | $ (449) | $ (146) |
INVESTMENT SECURITIES - Additio
INVESTMENT SECURITIES - Additional Information (Details) | 12 Months Ended | ||
Dec. 31, 2015USD ($)security | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | |
Investments, Debt and Equity Securities [Abstract] | |||
Number of individual securities that were in a continuous unrealized loss position for less than twelve months | security | 44 | ||
Number of individual securities that were in a continuous unrealized loss position for greater than twelve months | security | 21 | ||
Gross proceeds from sales of securities | $ 65,672,000 | $ 102,145,000 | $ 79,114,000 |
Impairment charges | 0 | 0 | $ 0 |
Carrying value of investment securities pledged | $ 131,089,000 | $ 128,501,000 |
INVESTMENT SECURITIES - Amort66
INVESTMENT SECURITIES - Amortized Cost and Fair Value of Debt Securities by Contractual Maturity (Details) $ in Thousands | Dec. 31, 2015USD ($) |
Available for Sale, Amortized Cost | |
Due in one year or less | $ 1,835 |
Due after one year to five years | 32,085 |
Due after five years to ten years | 88,554 |
Due after ten years | 37,681 |
Total amortized cost | 160,155 |
Available for Sale, Fair Value | |
Due in one year or less | 1,843 |
Due after one year to five years | 31,926 |
Due after five years to ten years | 87,311 |
Due after ten years | 38,745 |
Fair Value | $ 159,825 |
INVESTMENT SECURITIES - Realize
INVESTMENT SECURITIES - Realized Gains and Losses on Sales of Securities (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Gross realized gains and losses | |||
Gross realized gains | $ 2,711 | $ 4,298 | $ 3,147 |
Gross realized losses | 119 | 783 | 730 |
U.S. Government and agency securities | |||
Gross realized gains and losses | |||
Gross realized gains | 0 | 59 | 0 |
Gross realized losses | 0 | 45 | 0 |
Mortgage-backed securities | |||
Gross realized gains and losses | |||
Gross realized gains | 0 | 89 | 0 |
Gross realized losses | 0 | 0 | 92 |
State and political securities | |||
Gross realized gains and losses | |||
Gross realized gains | 1,571 | 2,327 | 2,076 |
Gross realized losses | 22 | 412 | 611 |
Other debt securities | |||
Gross realized gains and losses | |||
Gross realized gains | 825 | 622 | 490 |
Gross realized losses | 54 | 209 | 27 |
Financial institution equity securities | |||
Gross realized gains and losses | |||
Gross realized gains | 183 | 710 | 241 |
Gross realized losses | 0 | 0 | 0 |
Other equity securities | |||
Gross realized gains and losses | |||
Gross realized gains | 132 | 491 | 340 |
Gross realized losses | $ 43 | $ 117 | $ 0 |
FEDERAL HOME LOAN BANK STOCK (D
FEDERAL HOME LOAN BANK STOCK (Details) | Dec. 31, 2015$ / shares |
Federal Home Loan Banks [Abstract] | |
FHLB stock (in dollars per share) | $ 100 |
LOAN CREDIT QUALITY AND RELAT69
LOAN CREDIT QUALITY AND RELATED ALLOWANCE FOR LOAN LOSSES - Additional Information (Details) | 12 Months Ended | |||
Dec. 31, 2015USD ($)categoryclassloancontractcomponent | Dec. 31, 2014USD ($)loancontract | Dec. 31, 2013USD ($) | Jun. 01, 2013USD ($) | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Unpaid principal balance | $ 16,063,000 | $ 17,842,000 | $ 1,211,000 | |
Estimated fair value | 878,000 | |||
Contractual cash flows | 1,783,000 | |||
Expected cash flows | 941,000 | |||
Non-accretable discount | 842,000 | |||
Accretable discount | $ 0 | $ 35,000 | 63,000 | |
Minimum amount to evaluate individual loans for possible impairment | 100,000 | |||
Maximum amount to evaluate individual loans for possible impairment on a case by case basis | $ 100,000 | |||
Payment delays period up to which loans are not classified as impaired, maximum (in days) | 90 days | |||
Amount committed to be advanced in connection with impaired loans | $ 20,000 | |||
Period to classify TDR non performing loans to performing (in months) | 6 months | |||
Number of TDRs granted | loan | 22 | 9 | ||
Number of loans granted payment concessions | loan | 7 | 3 | ||
Loans granted payment concessions, amount | $ 1,008,000 | $ 288,000 | ||
Number of loans granted term concessions | loan | 4 | 5 | ||
Loans granted term concessions, amount | $ 183,000 | $ 1,142,000 | ||
Number of loans granted rate concessions | loan | 2 | 1 | ||
Loans granted rate concessions, amount | $ 287,000 | $ 218,000 | ||
Number of loans granted concessions due to other default | loan | 9 | |||
Loans granted concessions due to other default, amount | $ 1,108,000 | |||
Number of loan modifications, subsequently defaulted | contract | 8 | |||
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 | |||
Minimum amount after which external annual loan review is performed | 800,000 | |||
The total number of components that represents the allowance for loan losses | component | 2 | |||
The number of classes that groups of loans are collectively evaluated for impairment | class | 2 | |||
Period considered for quarter moving average which used in calculating historical charge off (in months) | 36 months | |||
Adjustment of period considered for quarter moving average which used in calculating historical charge off (in months) | 12 months | |||
Luzerne National Bank Corporation | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Minimum amount after which external annual loan review is performed | $ 1,450,000 | |||
Jersey Shore State Bank | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Minimum amount after which external annual loan review is performed | 1,100,000 | |||
Receivables Acquired with Deteriorated Credit Quality | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Loans acquired with deteriorated credit quality | $ 341,000 | 349,000 | ||
Real Estate | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Number of categories in which real estate loans are segmented | category | 3 | |||
Purchased Loans | Luzerne National Bank Corporation | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Unpaid principal balance | 1,211,000 | |||
Estimated fair value | 878,000 | |||
Contractual cash flows | 1,783,000 | |||
Expected cash flows | 941,000 | |||
Non-accretable discount | 842,000 | |||
Accretable discount | $ 63,000 | |||
Commercial Real Estate Mortgage | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Unpaid principal balance | $ 12,537,000 | $ 14,117,000 | ||
Number of loan modifications, subsequently defaulted | contract | 1 | 1 | ||
Commercial Real Estate Mortgage | Receivables Acquired with Deteriorated Credit Quality | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Loans acquired with deteriorated credit quality | $ 0 | $ 0 |
LOAN CREDIT QUALITY AND RELAT70
LOAN CREDIT QUALITY AND RELATED ALLOWANCE FOR LOAN LOSSES - Aging Category of Loans, by Segment (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Aging categories of loans by segment | |||
Current | $ 1,028,966 | $ 895,468 | |
Past Due 30 To 89 Days | 8,207 | 9,053 | |
Past Due 90 Days Or More & Still Accruing | 979 | 387 | |
Non-Accrual | 8,467 | 11,861 | |
Total | 1,046,619 | 916,769 | |
Net deferred loan fees and discounts | (1,412) | (1,190) | |
Allowance for loan losses | (12,044) | (10,579) | $ (10,144) |
Current loans, net | 1,015,510 | 883,699 | |
Loans, net | 1,033,163 | 905,000 | |
Commercial, Financial, and Agricultural | |||
Aging categories of loans by segment | |||
Current | 162,312 | 122,624 | |
Past Due 30 To 89 Days | 164 | 773 | |
Past Due 90 Days Or More & Still Accruing | 0 | 0 | |
Non-Accrual | 1,596 | 759 | |
Total | 164,072 | 124,156 | |
Allowance for loan losses | (1,532) | (1,124) | (474) |
Residential Real Estate Mortgages | |||
Aging categories of loans by segment | |||
Current | 517,753 | 450,503 | |
Past Due 30 To 89 Days | 6,827 | 6,078 | |
Past Due 90 Days Or More & Still Accruing | 714 | 332 | |
Non-Accrual | 889 | 847 | |
Total | 526,183 | 457,760 | |
Allowance for loan losses | (5,116) | (3,755) | (3,917) |
Commercial Real Estate Mortgage | |||
Aging categories of loans by segment | |||
Current | 295,784 | 279,731 | |
Past Due 30 To 89 Days | 720 | 1,819 | |
Past Due 90 Days Or More & Still Accruing | 265 | 54 | |
Non-Accrual | 5,770 | 9,744 | |
Total | 302,539 | 291,348 | |
Allowance for loan losses | (4,217) | (4,205) | (4,079) |
Construction Real Estate Mortgage | |||
Aging categories of loans by segment | |||
Current | 26,545 | 21,485 | |
Past Due 30 To 89 Days | 67 | 0 | |
Past Due 90 Days Or More & Still Accruing | 0 | 0 | |
Non-Accrual | 212 | 511 | |
Total | 26,824 | 21,996 | |
Allowance for loan losses | (160) | (786) | (741) |
Installment Loans to Individuals | |||
Aging categories of loans by segment | |||
Current | 26,572 | 21,125 | |
Past Due 30 To 89 Days | 429 | 383 | |
Past Due 90 Days Or More & Still Accruing | 0 | 1 | |
Non-Accrual | 0 | 0 | |
Total | 27,001 | 21,509 | |
Allowance for loan losses | $ (243) | $ (245) | $ (139) |
LOAN CREDIT QUALITY AND RELAT71
LOAN CREDIT QUALITY AND RELATED ALLOWANCE FOR LOAN LOSSES - Components of Purchase Accounting Adjustments (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Jun. 01, 2013 |
Components of the purchase accounting adjustments related to the purchased impaired loans acquired | ||||
Unpaid principal balance | $ 16,063 | $ 17,842 | $ 1,211 | |
Interest | 572 | |||
Contractual cash flows | 1,783 | |||
Non-accretable discount | (842) | |||
Expected cash flows | 941 | |||
Accretable discount | $ 0 | $ (35) | (63) | |
Estimated fair value | $ 878 |
LOAN CREDIT QUALITY AND RELAT72
LOAN CREDIT QUALITY AND RELATED ALLOWANCE FOR LOAN LOSSES - Changes in Amortizable Yield for Purchased Credit-impaired Loans (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2014USD ($) | |
Changes in the amortizable yield for purchased credit-impaired loans | |
Balance at beginning of period | $ 35 |
Accretion | (35) |
Balance at end of period | $ 0 |
LOAN CREDIT QUALITY AND RELAT73
LOAN CREDIT QUALITY AND RELATED ALLOWANCE FOR LOAN LOSSES - Additional Information Regarding Loans Acquired (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Outstanding balance | $ 441,000 | $ 449,000 |
Receivables Acquired with Deteriorated Credit Quality | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Carrying amount | $ 341,000 | $ 349,000 |
LOAN CREDIT QUALITY AND RELAT74
LOAN CREDIT QUALITY AND RELATED ALLOWANCE FOR LOAN LOSSES - Interest Income if Interest Would Have Been Recorded (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Loan credit quality and related allowance for loan losses | |||
Interest Income That Would Have Been Recorded Based on Original Term and Rate | $ 398 | $ 768 | $ 583 |
Interest Income Recorded on a Cash Basis | 145 | 333 | 330 |
Commercial, Financial, and Agricultural | |||
Loan credit quality and related allowance for loan losses | |||
Interest Income That Would Have Been Recorded Based on Original Term and Rate | 48 | 42 | 7 |
Interest Income Recorded on a Cash Basis | 53 | 33 | 3 |
Residential Real Estate Mortgages | |||
Loan credit quality and related allowance for loan losses | |||
Interest Income That Would Have Been Recorded Based on Original Term and Rate | 53 | 63 | 41 |
Interest Income Recorded on a Cash Basis | 38 | 34 | 20 |
Commercial Real Estate Mortgage | |||
Loan credit quality and related allowance for loan losses | |||
Interest Income That Would Have Been Recorded Based on Original Term and Rate | 281 | 600 | 447 |
Interest Income Recorded on a Cash Basis | 54 | 264 | 251 |
Construction Real Estate Mortgage | |||
Loan credit quality and related allowance for loan losses | |||
Interest Income That Would Have Been Recorded Based on Original Term and Rate | 16 | 63 | 88 |
Interest Income Recorded on a Cash Basis | $ 0 | $ 2 | $ 56 |
LOAN CREDIT QUALITY AND RELAT75
LOAN CREDIT QUALITY AND RELATED ALLOWANCE FOR LOAN LOSSES - Recorded Investment, Unpaid Principal Balance, and Related Allowance of Impaired Loans by Segment (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | Jun. 01, 2013 |
Credit Quality and Related Allowance for Loan Losses | |||
Recorded Investment, With no related allowance recorded | $ 3,408 | $ 4,522 | |
Unpaid Principal Balance, With no related allowance recorded | 3,458 | 4,522 | |
Recorded Investment, With an allowance recorded | 12,475 | 13,054 | |
Unpaid Principal Balance, With an allowance recorded | 12,605 | 13,320 | |
Recorded Investment | 15,883 | 17,576 | |
Unpaid Principal Balance | 16,063 | 17,842 | $ 1,211 |
Related Allowance | 2,104 | 2,093 | |
Commercial, Financial, and Agricultural | |||
Credit Quality and Related Allowance for Loan Losses | |||
Recorded Investment, With no related allowance recorded | 319 | 439 | |
Unpaid Principal Balance, With no related allowance recorded | 319 | 439 | |
Recorded Investment, With an allowance recorded | 150 | 673 | |
Unpaid Principal Balance, With an allowance recorded | 150 | 673 | |
Recorded Investment | 469 | 1,112 | |
Unpaid Principal Balance | 469 | 1,112 | |
Related Allowance | 75 | 298 | |
Residential Real Estate Mortgages | |||
Credit Quality and Related Allowance for Loan Losses | |||
Recorded Investment, With no related allowance recorded | 1,142 | 139 | |
Unpaid Principal Balance, With no related allowance recorded | 1,142 | 139 | |
Recorded Investment, With an allowance recorded | 1,573 | 1,327 | |
Unpaid Principal Balance, With an allowance recorded | 1,703 | 1,449 | |
Recorded Investment | 2,715 | 1,466 | |
Unpaid Principal Balance | 2,845 | 1,588 | |
Related Allowance | 376 | 147 | |
Commercial Real Estate Mortgage | |||
Credit Quality and Related Allowance for Loan Losses | |||
Recorded Investment, With no related allowance recorded | 1,735 | 3,228 | |
Unpaid Principal Balance, With no related allowance recorded | 1,785 | 3,228 | |
Recorded Investment, With an allowance recorded | 10,752 | 10,745 | |
Unpaid Principal Balance, With an allowance recorded | 10,752 | 10,889 | |
Recorded Investment | 12,487 | 13,973 | |
Unpaid Principal Balance | 12,537 | 14,117 | |
Related Allowance | 1,653 | 1,581 | |
Construction Real Estate Mortgage | |||
Credit Quality and Related Allowance for Loan Losses | |||
Recorded Investment, With no related allowance recorded | 212 | 716 | |
Unpaid Principal Balance, With no related allowance recorded | 212 | 716 | |
Recorded Investment, With an allowance recorded | 0 | 309 | |
Unpaid Principal Balance, With an allowance recorded | 0 | 309 | |
Recorded Investment | 212 | 1,025 | |
Unpaid Principal Balance | 212 | 1,025 | |
Related Allowance | $ 0 | $ 67 |
LOAN CREDIT QUALITY AND RELAT76
LOAN CREDIT QUALITY AND RELATED ALLOWANCE FOR LOAN LOSSES - Average Recorded Investment in Impaired Loans (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Average Investment in Impaired Loans | $ 21,995 | $ 14,081 | $ 13,375 |
Interest Income Recognized on an Accrual Basis on Impaired Loans | 436 | 219 | 272 |
Interest Income Recognized on a Cash Basis on Impaired Loans | 190 | 235 | 689 |
Commercial, Financial, and Agricultural | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Average Investment in Impaired Loans | 1,031 | 763 | 538 |
Interest Income Recognized on an Accrual Basis on Impaired Loans | 21 | 26 | 26 |
Interest Income Recognized on a Cash Basis on Impaired Loans | 10 | 25 | 0 |
Residential Real Estate Mortgages | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Average Investment in Impaired Loans | 2,570 | 1,245 | 1,581 |
Interest Income Recognized on an Accrual Basis on Impaired Loans | 72 | 46 | 62 |
Interest Income Recognized on a Cash Basis on Impaired Loans | 47 | 20 | 25 |
Commercial Real Estate Mortgage | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Average Investment in Impaired Loans | 17,529 | 10,987 | 8,605 |
Interest Income Recognized on an Accrual Basis on Impaired Loans | 342 | 130 | 183 |
Interest Income Recognized on a Cash Basis on Impaired Loans | 80 | 101 | 95 |
Construction Real Estate Mortgage | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Average Investment in Impaired Loans | 865 | 1,086 | 2,651 |
Interest Income Recognized on an Accrual Basis on Impaired Loans | 1 | 17 | 1 |
Interest Income Recognized on a Cash Basis on Impaired Loans | $ 53 | $ 89 | $ 569 |
LOAN CREDIT QUALITY AND RELAT77
LOAN CREDIT QUALITY AND RELATED ALLOWANCE FOR LOAN LOSSES - Loan Modifications Considered TDRs (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015USD ($)contract | Dec. 31, 2014USD ($)contract | |
Troubled debt restructurings | ||
Number of Contracts | contract | 22 | 9 |
Pre-Modification Outstanding Recorded Investment | $ 2,586 | $ 1,648 |
Post-Modification Outstanding Recorded Investment | $ 2,586 | $ 1,648 |
Number of loan modifications, subsequently defaulted | contract | 8 | |
Recorded investment, subsequently defaulted | $ 722 | |
Commercial, Financial, and Agricultural | ||
Troubled debt restructurings | ||
Number of Contracts | contract | 4 | 3 |
Pre-Modification Outstanding Recorded Investment | $ 213 | $ 620 |
Post-Modification Outstanding Recorded Investment | $ 213 | $ 620 |
Number of loan modifications, subsequently defaulted | contract | 1 | |
Recorded investment, subsequently defaulted | $ 106 | |
Residential Real Estate Mortgages | ||
Troubled debt restructurings | ||
Number of Contracts | contract | 11 | 3 |
Pre-Modification Outstanding Recorded Investment | $ 962 | $ 392 |
Post-Modification Outstanding Recorded Investment | $ 962 | $ 392 |
Number of loan modifications, subsequently defaulted | contract | 6 | |
Recorded investment, subsequently defaulted | $ 374 | |
Commercial Real Estate Mortgage | ||
Troubled debt restructurings | ||
Number of Contracts | contract | 6 | 3 |
Pre-Modification Outstanding Recorded Investment | $ 1,013 | $ 636 |
Post-Modification Outstanding Recorded Investment | $ 1,013 | $ 636 |
Number of loan modifications, subsequently defaulted | contract | 1 | 1 |
Recorded investment, subsequently defaulted | $ 242 | |
Construction Real Estate Mortgage | ||
Troubled debt restructurings | ||
Number of Contracts | contract | 1 | 0 |
Pre-Modification Outstanding Recorded Investment | $ 398 | $ 0 |
Post-Modification Outstanding Recorded Investment | $ 398 | $ 0 |
LOAN CREDIT QUALITY AND RELAT78
LOAN CREDIT QUALITY AND RELATED ALLOWANCE FOR LOAN LOSSES - Credit Quality Categories (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Credit quality categories | ||
Total | $ 1,046,619 | $ 916,769 |
Commercial, Financial, and Agricultural | ||
Credit quality categories | ||
Total | 164,072 | 124,156 |
Residential Real Estate Mortgages | ||
Credit quality categories | ||
Total | 526,183 | 457,760 |
Commercial Real Estate Mortgage | ||
Credit quality categories | ||
Total | 302,539 | 291,348 |
Construction Real Estate Mortgage | ||
Credit quality categories | ||
Total | 26,824 | 21,996 |
Installment Loans to Individuals | ||
Credit quality categories | ||
Total | 27,001 | 21,509 |
Pass | ||
Credit quality categories | ||
Total | 1,014,448 | 871,975 |
Pass | Commercial, Financial, and Agricultural | ||
Credit quality categories | ||
Total | 160,734 | 118,210 |
Pass | Residential Real Estate Mortgages | ||
Credit quality categories | ||
Total | 522,853 | 454,885 |
Pass | Commercial Real Estate Mortgage | ||
Credit quality categories | ||
Total | 277,248 | 256,444 |
Pass | Construction Real Estate Mortgage | ||
Credit quality categories | ||
Total | 26,612 | 20,927 |
Pass | Installment Loans to Individuals | ||
Credit quality categories | ||
Total | 27,001 | 21,509 |
Special Mention | ||
Credit quality categories | ||
Total | 11,117 | 22,277 |
Special Mention | Commercial, Financial, and Agricultural | ||
Credit quality categories | ||
Total | 1,669 | 3,186 |
Special Mention | Residential Real Estate Mortgages | ||
Credit quality categories | ||
Total | 823 | 2,384 |
Special Mention | Commercial Real Estate Mortgage | ||
Credit quality categories | ||
Total | 8,625 | 16,262 |
Special Mention | Construction Real Estate Mortgage | ||
Credit quality categories | ||
Total | 0 | 445 |
Special Mention | Installment Loans to Individuals | ||
Credit quality categories | ||
Total | 0 | 0 |
Substandard | ||
Credit quality categories | ||
Total | 21,054 | 22,517 |
Substandard | Commercial, Financial, and Agricultural | ||
Credit quality categories | ||
Total | 1,669 | 2,760 |
Substandard | Residential Real Estate Mortgages | ||
Credit quality categories | ||
Total | 2,507 | 491 |
Substandard | Commercial Real Estate Mortgage | ||
Credit quality categories | ||
Total | 16,666 | 18,642 |
Substandard | Construction Real Estate Mortgage | ||
Credit quality categories | ||
Total | 212 | 624 |
Substandard | Installment Loans to Individuals | ||
Credit quality categories | ||
Total | $ 0 | $ 0 |
LOAN CREDIT QUALITY AND RELAT79
LOAN CREDIT QUALITY AND RELATED ALLOWANCE FOR LOAN LOSSES - Allowance Activity (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2015 | Dec. 31, 2014 | |
Changes in allowance | |||||||||||||
Balance at the beginning of the period | $ 10,579,000 | $ 10,144,000 | $ 10,579,000 | $ 10,144,000 | |||||||||
Charge-offs | (1,361,000) | (2,534,000) | |||||||||||
Recoveries | 526,000 | 119,000 | |||||||||||
Provision for loan losses | $ 480,000 | $ 520,000 | $ 600,000 | 700,000 | $ 1,605,000 | $ 460,000 | $ 300,000 | 485,000 | 2,300,000 | 2,850,000 | $ 2,275,000 | ||
Balance at the end of the period | 12,044,000 | 10,579,000 | 12,044,000 | 10,579,000 | 10,144,000 | ||||||||
Allowance for Loan Losses: | |||||||||||||
Individually evaluated for impairment | $ 2,104,000 | $ 2,093,000 | |||||||||||
Collectively evaluated for impairment | 9,940,000 | 8,486,000 | |||||||||||
Total ending allowance balance | 12,044,000 | 10,579,000 | 10,579,000 | 10,144,000 | 10,579,000 | 10,144,000 | 10,144,000 | 12,044,000 | 10,579,000 | ||||
Loans | |||||||||||||
Individually evaluated for impairment | 15,542,000 | 17,227,000 | |||||||||||
Collectively evaluated for impairment | 1,030,736,000 | 899,193,000 | |||||||||||
Total | 1,046,619,000 | 916,769,000 | |||||||||||
Commercial, Financial, and Agricultural | |||||||||||||
Changes in allowance | |||||||||||||
Balance at the beginning of the period | 1,124,000 | 474,000 | 1,124,000 | 474,000 | |||||||||
Charge-offs | (283,000) | (289,000) | |||||||||||
Recoveries | 176,000 | 18,000 | |||||||||||
Provision for loan losses | 515,000 | 921,000 | |||||||||||
Balance at the end of the period | 1,532,000 | 1,124,000 | 1,532,000 | 1,124,000 | 474,000 | ||||||||
Allowance for Loan Losses: | |||||||||||||
Individually evaluated for impairment | 75,000 | 298,000 | |||||||||||
Collectively evaluated for impairment | 1,457,000 | 826,000 | |||||||||||
Total ending allowance balance | 1,532,000 | 1,124,000 | 1,124,000 | 474,000 | 1,124,000 | 474,000 | 474,000 | 1,532,000 | 1,124,000 | ||||
Loans | |||||||||||||
Individually evaluated for impairment | 469,000 | 1,112,000 | |||||||||||
Collectively evaluated for impairment | 163,603,000 | 123,044,000 | |||||||||||
Total | 164,072,000 | 124,156,000 | |||||||||||
Residential Real Estate Mortgages | |||||||||||||
Changes in allowance | |||||||||||||
Balance at the beginning of the period | 3,755,000 | 3,917,000 | 3,755,000 | 3,917,000 | |||||||||
Charge-offs | (49,000) | (65,000) | |||||||||||
Recoveries | 81,000 | 15,000 | |||||||||||
Provision for loan losses | 1,329,000 | (112,000) | |||||||||||
Balance at the end of the period | 5,116,000 | 3,755,000 | 5,116,000 | 3,755,000 | 3,917,000 | ||||||||
Allowance for Loan Losses: | |||||||||||||
Individually evaluated for impairment | 376,000 | 147,000 | |||||||||||
Collectively evaluated for impairment | 4,740,000 | 3,608,000 | |||||||||||
Total ending allowance balance | 5,116,000 | 3,755,000 | 3,755,000 | 3,917,000 | $ 3,755,000 | $ 3,917,000 | 3,917,000 | 5,116,000 | 3,755,000 | ||||
Loans | |||||||||||||
Individually evaluated for impairment | 2,374,000 | 1,117,000 | |||||||||||
Collectively evaluated for impairment | 523,468,000 | 456,294,000 | |||||||||||
Total | 526,183,000 | 457,760,000 | |||||||||||
Residential Real Estate Mortgages | Financing receivable | Owners of rental properties | |||||||||||||
Changes in allowance | |||||||||||||
Concentration of loans (as a percent) | 16.21% | 16.01% | |||||||||||
Commercial Real Estate Mortgage | |||||||||||||
Changes in allowance | |||||||||||||
Balance at the beginning of the period | 4,205,000 | 4,079,000 | $ 4,205,000 | $ 4,079,000 | |||||||||
Charge-offs | (743,000) | (2,038,000) | |||||||||||
Recoveries | 182,000 | 0 | |||||||||||
Provision for loan losses | 573,000 | 2,164,000 | |||||||||||
Balance at the end of the period | 4,217,000 | 4,205,000 | 4,217,000 | 4,205,000 | 4,079,000 | ||||||||
Allowance for Loan Losses: | |||||||||||||
Individually evaluated for impairment | 1,653,000 | 1,581,000 | |||||||||||
Collectively evaluated for impairment | 2,564,000 | 2,624,000 | |||||||||||
Total ending allowance balance | 4,217,000 | 4,205,000 | 4,205,000 | 4,079,000 | $ 4,205,000 | $ 4,079,000 | 4,079,000 | 4,217,000 | 4,205,000 | ||||
Loans | |||||||||||||
Individually evaluated for impairment | 12,487,000 | 13,973,000 | |||||||||||
Collectively evaluated for impairment | 290,052,000 | 277,375,000 | |||||||||||
Total | 302,539,000 | 291,348,000 | |||||||||||
Commercial Real Estate Mortgage | Financing receivable | Owners of rental properties | |||||||||||||
Changes in allowance | |||||||||||||
Concentration of loans (as a percent) | 14.22% | 14.67% | |||||||||||
Construction Real Estate Mortgage | |||||||||||||
Changes in allowance | |||||||||||||
Balance at the beginning of the period | 786,000 | 741,000 | $ 786,000 | $ 741,000 | |||||||||
Charge-offs | (46,000) | 0 | |||||||||||
Recoveries | 23,000 | 22,000 | |||||||||||
Provision for loan losses | (603,000) | 23,000 | |||||||||||
Balance at the end of the period | 160,000 | 786,000 | 160,000 | 786,000 | 741,000 | ||||||||
Allowance for Loan Losses: | |||||||||||||
Individually evaluated for impairment | 0 | 67,000 | |||||||||||
Collectively evaluated for impairment | 160,000 | 719,000 | |||||||||||
Total ending allowance balance | 160,000 | 786,000 | 786,000 | 741,000 | 786,000 | 741,000 | 741,000 | 160,000 | 786,000 | ||||
Loans | |||||||||||||
Individually evaluated for impairment | 212,000 | 1,025,000 | |||||||||||
Collectively evaluated for impairment | 26,612,000 | 20,971,000 | |||||||||||
Total | 26,824,000 | 21,996,000 | |||||||||||
Installment Loans to Individuals | |||||||||||||
Changes in allowance | |||||||||||||
Balance at the beginning of the period | 245,000 | 139,000 | 245,000 | 139,000 | |||||||||
Charge-offs | (240,000) | (142,000) | |||||||||||
Recoveries | 64,000 | 64,000 | |||||||||||
Provision for loan losses | 174,000 | 184,000 | |||||||||||
Balance at the end of the period | 243,000 | 245,000 | 243,000 | 245,000 | 139,000 | ||||||||
Allowance for Loan Losses: | |||||||||||||
Individually evaluated for impairment | 0 | 0 | |||||||||||
Collectively evaluated for impairment | 243,000 | 245,000 | |||||||||||
Total ending allowance balance | 243,000 | 245,000 | 245,000 | 139,000 | 245,000 | 139,000 | 139,000 | 243,000 | 245,000 | ||||
Loans | |||||||||||||
Individually evaluated for impairment | 0 | 0 | |||||||||||
Collectively evaluated for impairment | 27,001,000 | 21,509,000 | |||||||||||
Total | 27,001,000 | 21,509,000 | |||||||||||
Unallocated | |||||||||||||
Changes in allowance | |||||||||||||
Balance at the beginning of the period | 464,000 | 794,000 | 464,000 | 794,000 | |||||||||
Charge-offs | 0 | 0 | |||||||||||
Recoveries | 0 | 0 | |||||||||||
Provision for loan losses | 312,000 | (330,000) | |||||||||||
Balance at the end of the period | 776,000 | 464,000 | 776,000 | 464,000 | 794,000 | ||||||||
Allowance for Loan Losses: | |||||||||||||
Individually evaluated for impairment | 0 | 0 | |||||||||||
Collectively evaluated for impairment | 776,000 | 464,000 | |||||||||||
Total ending allowance balance | $ 776,000 | $ 464,000 | $ 464,000 | $ 794,000 | $ 464,000 | $ 794,000 | $ 794,000 | 776,000 | 464,000 | ||||
Receivables Acquired with Deteriorated Credit Quality | |||||||||||||
Loans | |||||||||||||
Loans acquired with deteriorated credit quality | 341,000 | 349,000 | |||||||||||
Receivables Acquired with Deteriorated Credit Quality | Commercial, Financial, and Agricultural | |||||||||||||
Loans | |||||||||||||
Loans acquired with deteriorated credit quality | 0 | 0 | |||||||||||
Receivables Acquired with Deteriorated Credit Quality | Residential Real Estate Mortgages | |||||||||||||
Loans | |||||||||||||
Loans acquired with deteriorated credit quality | 341,000 | 349,000 | |||||||||||
Receivables Acquired with Deteriorated Credit Quality | Commercial Real Estate Mortgage | |||||||||||||
Loans | |||||||||||||
Loans acquired with deteriorated credit quality | 0 | 0 | |||||||||||
Receivables Acquired with Deteriorated Credit Quality | Construction Real Estate Mortgage | |||||||||||||
Loans | |||||||||||||
Loans acquired with deteriorated credit quality | 0 | 0 | |||||||||||
Receivables Acquired with Deteriorated Credit Quality | Installment Loans to Individuals | |||||||||||||
Loans | |||||||||||||
Loans acquired with deteriorated credit quality | $ 0 | $ 0 |
PREMISES AND EQUIPMENT (Details
PREMISES AND EQUIPMENT (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
PREMISES AND EQUIPMENT | |||
Gross premises and equipment | $ 31,531 | $ 29,312 | |
Less accumulated depreciation and amortization | 9,701 | 8,203 | |
Net premises and equipment | 21,830 | 21,109 | |
Depreciation and amortization | 3,366 | 3,078 | $ 1,448 |
Land | |||
PREMISES AND EQUIPMENT | |||
Gross premises and equipment | 5,764 | 5,759 | |
Premises | |||
PREMISES AND EQUIPMENT | |||
Gross premises and equipment | 16,074 | 14,767 | |
Furniture and equipment | |||
PREMISES AND EQUIPMENT | |||
Gross premises and equipment | 8,231 | 7,435 | |
Leasehold improvements | |||
PREMISES AND EQUIPMENT | |||
Gross premises and equipment | 1,462 | 1,351 | |
Premises and Equipment | |||
PREMISES AND EQUIPMENT | |||
Depreciation and amortization | $ 1,564 | $ 1,494 | $ 1,054 |
GOODWILL AND OTHER INTANGIBLE81
GOODWILL AND OTHER INTANGIBLES - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Gross carrying value | $ 17,380,000 | $ 17,380,000 | |
Accumulated amortization | 276,000 | 276,000 | |
Goodwill | 17,104,000 | 17,104,000 | |
Goodwill impairment loss | 0 | $ 0 | $ 0 |
Core Deposits | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount | 1,072,000 | ||
Accumulated amortization | 521,000 | ||
Trade Names | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount | 76,000 | ||
Accumulated amortization | 37,000 | ||
Book of Business | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount | 92,000 | ||
Accumulated amortization | $ 3,000 |
GOODWILL AND OTHER INTANGIBLE82
GOODWILL AND OTHER INTANGIBLES - Future Amortization Expense (Details) $ in Thousands | Dec. 31, 2015USD ($) |
Core Deposits | |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |
2,016 | $ 254 |
2,017 | 220 |
2,018 | 185 |
2,019 | 151 |
2,020 | 117 |
2,021 | 83 |
2,022 | 48 |
2,023 | 14 |
2,024 | 0 |
2,025 | 0 |
Total | 1,072 |
Trade Names | |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |
2,016 | 18 |
2,017 | 15 |
2,018 | 13 |
2,019 | 11 |
2,020 | 8 |
2,021 | 6 |
2,022 | 4 |
2,023 | 1 |
2,024 | 0 |
2,025 | 0 |
Total | 76 |
Book of Business | |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |
2,016 | 10 |
2,017 | 10 |
2,018 | 10 |
2,019 | 10 |
2,020 | 10 |
2,021 | 10 |
2,022 | 10 |
2,023 | 10 |
2,024 | 10 |
2,025 | 2 |
Total | $ 92 |
TIME DEPOSITS (Details)
TIME DEPOSITS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Banking and Thrift [Abstract] | |||
Time deposits of $250,000 or more | $ 28,953 | $ 26,468 | |
Interest expense related to time deposits of $100,000 or more | 1,112 | $ 875 | $ 841 |
Scheduled maturities on time deposits of $100,000 or more | |||
Three months or less | 12,006 | ||
Three months to six months | 5,863 | ||
Six months to twelve months | 17,036 | ||
Over twelve months | 71,687 | ||
Total | 106,592 | ||
Total time deposit maturities | |||
2,016 | 81,010 | ||
2,017 | 55,318 | ||
2,018 | 51,104 | ||
2,019 | 24,796 | ||
2,020 | 7,093 | ||
Thereafter | 2,056 | ||
Total | $ 221,377 |
SHORT-TERM BORROWINGS - Schedul
SHORT-TERM BORROWINGS - Schedule of Short-term borrowings (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
SHORT-TERM BORROWINGS | |||
Balance at year end | $ 46,638 | $ 40,818 | |
Line of Credit | |||
SHORT-TERM BORROWINGS | |||
Additional lines of credit available from correspondent banks other than the FHLB | 35,413 | ||
Repurchase Agreements | |||
SHORT-TERM BORROWINGS | |||
Balance at year end | 18,334 | 13,987 | $ 12,391 |
Maximum amount outstanding at any month end | 18,614 | 18,801 | 16,632 |
Average balance outstanding during the year | $ 15,834 | $ 16,350 | $ 16,839 |
Weighted-average interest rate: At year end (as a percent) | 0.21% | 0.23% | 0.28% |
Weighted-average interest rate: Paid during the year (as a percent) | 0.21% | 0.22% | 0.40% |
Open Repo Plus | |||
SHORT-TERM BORROWINGS | |||
Balance at year end | $ 28,304 | $ 26,831 | $ 14,325 |
Maximum amount outstanding at any month end | 42,760 | 26,831 | 21,350 |
Average balance outstanding during the year | $ 23,075 | $ 5,992 | $ 5,508 |
Weighted-average interest rate: At year end (as a percent) | 0.43% | 0.27% | 0.25% |
Weighted-average interest rate: Paid during the year (as a percent) | 0.36% | 0.30% | 0.31% |
SHORT-TERM BORROWINGS - Contrac
SHORT-TERM BORROWINGS - Contractual Maturity of Repurchase Agreements (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
SHORT-TERM BORROWINGS | |||
Short-term borrowings | $ 46,638 | $ 40,818 | |
Repurchase Agreements | |||
SHORT-TERM BORROWINGS | |||
Short-term borrowings | 18,334 | 13,987 | $ 12,391 |
Overnight and Continuous | |||
SHORT-TERM BORROWINGS | |||
Securities borrowed, gross including not subject to master netting arrangement | 24,084 | 20,235 | |
Overnight and Continuous | US Treasury and Government | |||
SHORT-TERM BORROWINGS | |||
Securities borrowed, gross including not subject to master netting arrangement | 3,586 | 3,953 | |
Overnight and Continuous | Collateralized Mortgage Backed Securities [Member] | |||
SHORT-TERM BORROWINGS | |||
Securities borrowed, gross including not subject to master netting arrangement | 8,368 | 4,526 | |
Overnight and Continuous | Asset-backed securities | |||
SHORT-TERM BORROWINGS | |||
Securities borrowed, gross including not subject to master netting arrangement | 1,960 | 2,468 | |
Overnight and Continuous | State and political securities | |||
SHORT-TERM BORROWINGS | |||
Securities borrowed, gross including not subject to master netting arrangement | 8,015 | 7,070 | |
Overnight and Continuous | Other debt securities | |||
SHORT-TERM BORROWINGS | |||
Securities borrowed, gross including not subject to master netting arrangement | $ 2,155 | $ 2,218 |
LONG-TERM BORROWINGS - Long-ter
LONG-TERM BORROWINGS - Long-term Borrowings with FHLB by Contractual Maturities (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
LONG-TERM BORROWINGS | ||
Weighted-Average Interest Rate (as a percent) | 2.14% | 2.65% |
Outstanding long-term borrowings with the FHLB by contractual maturities | $ 90,625 | $ 70,750 |
Outstanding amount of long-term borrowings with the FHLB by contractual maturities | ||
2,016 | 5,000 | |
2,017 | 45,000 | |
2,018 | 12,000 | |
2,019 | 7,292 | |
Thereafter | 21,333 | |
Total | $ 90,625 | |
Weighted-Average Rate of outstanding long-term borrowings with the FHLB by contractual maturities | ||
2016 (as a percent) | 0.75% | |
2017 (as a percent) | 2.38% | |
2018 (as percent) | 2.84% | |
2019 (as a percent) | 1.55% | |
Thereafter (as percent) | 1.75% | |
Weighted-Average Interest Rate (as a percent) | 2.14% | 2.65% |
Variable | ||
LONG-TERM BORROWINGS | ||
Weighted-Average Interest Rate (as a percent) | 3.87% | 3.90% |
Outstanding long-term borrowings with the FHLB by contractual maturities | $ 30,000 | $ 40,000 |
Weighted-Average Rate of outstanding long-term borrowings with the FHLB by contractual maturities | ||
Weighted-Average Interest Rate (as a percent) | 3.87% | 3.90% |
Variable | 2015 | ||
LONG-TERM BORROWINGS | ||
Weighted-Average Interest Rate (as a percent) | 0.00% | 3.97% |
Stated Interest Rate Range From (as a percent) | 3.97% | 3.97% |
Stated Interest Rate Range To (as a percent) | 3.97% | 3.97% |
Outstanding long-term borrowings with the FHLB by contractual maturities | $ 0 | $ 10,000 |
Weighted-Average Rate of outstanding long-term borrowings with the FHLB by contractual maturities | ||
Weighted-Average Interest Rate (as a percent) | 0.00% | 3.97% |
Variable | 2017 | ||
LONG-TERM BORROWINGS | ||
Weighted-Average Interest Rate (as a percent) | 4.22% | 4.22% |
Stated Interest Rate Range From (as a percent) | 4.15% | 4.15% |
Stated Interest Rate Range To (as a percent) | 4.28% | 4.28% |
Outstanding long-term borrowings with the FHLB by contractual maturities | $ 20,000 | $ 20,000 |
Weighted-Average Rate of outstanding long-term borrowings with the FHLB by contractual maturities | ||
Weighted-Average Interest Rate (as a percent) | 4.22% | 4.22% |
Variable | 2018 | ||
LONG-TERM BORROWINGS | ||
Weighted-Average Interest Rate (as a percent) | 3.18% | 3.18% |
Stated Interest Rate Range From (as a percent) | 3.18% | 3.18% |
Stated Interest Rate Range To (as a percent) | 3.18% | 3.18% |
Outstanding long-term borrowings with the FHLB by contractual maturities | $ 10,000 | $ 10,000 |
Weighted-Average Rate of outstanding long-term borrowings with the FHLB by contractual maturities | ||
Weighted-Average Interest Rate (as a percent) | 3.18% | 3.18% |
Fixed | ||
LONG-TERM BORROWINGS | ||
Weighted-Average Interest Rate (as a percent) | 1.28% | 1.03% |
Outstanding long-term borrowings with the FHLB by contractual maturities | $ 60,625 | $ 30,750 |
Weighted-Average Rate of outstanding long-term borrowings with the FHLB by contractual maturities | ||
Weighted-Average Interest Rate (as a percent) | 1.28% | 1.03% |
Fixed | 2015 | ||
LONG-TERM BORROWINGS | ||
Weighted-Average Interest Rate (as a percent) | 0.00% | 6.92% |
Stated Interest Rate Range From (as a percent) | 6.92% | 6.92% |
Stated Interest Rate Range To (as a percent) | 6.92% | 6.92% |
Outstanding long-term borrowings with the FHLB by contractual maturities | $ 0 | $ 750 |
Weighted-Average Rate of outstanding long-term borrowings with the FHLB by contractual maturities | ||
Weighted-Average Interest Rate (as a percent) | 0.00% | 6.92% |
Fixed | 2016 | ||
LONG-TERM BORROWINGS | ||
Weighted-Average Interest Rate (as a percent) | 0.75% | 0.75% |
Stated Interest Rate Range From (as a percent) | 0.75447% | 0.75447% |
Stated Interest Rate Range To (as a percent) | 0.75447% | 0.75447% |
Outstanding long-term borrowings with the FHLB by contractual maturities | $ 5,000 | $ 5,000 |
Weighted-Average Rate of outstanding long-term borrowings with the FHLB by contractual maturities | ||
Weighted-Average Interest Rate (as a percent) | 0.75% | 0.75% |
Fixed | 2017 | ||
LONG-TERM BORROWINGS | ||
Weighted-Average Interest Rate (as a percent) | 0.91% | 0.91% |
Stated Interest Rate Range From (as a percent) | 0.896% | 0.896% |
Stated Interest Rate Range To (as a percent) | 0.96549% | 0.96549% |
Outstanding long-term borrowings with the FHLB by contractual maturities | $ 25,000 | $ 25,000 |
Weighted-Average Rate of outstanding long-term borrowings with the FHLB by contractual maturities | ||
Weighted-Average Interest Rate (as a percent) | 0.91% | 0.91% |
Fixed | 2018 | ||
LONG-TERM BORROWINGS | ||
Weighted-Average Interest Rate (as a percent) | 1.13% | 0.00% |
Stated Interest Rate Range From (as a percent) | 1.13354% | |
Stated Interest Rate Range To (as a percent) | 1.13354% | |
Outstanding long-term borrowings with the FHLB by contractual maturities | $ 2,000 | $ 0 |
Weighted-Average Rate of outstanding long-term borrowings with the FHLB by contractual maturities | ||
Weighted-Average Interest Rate (as a percent) | 1.13% | 0.00% |
Fixed | 2019 | ||
LONG-TERM BORROWINGS | ||
Weighted-Average Interest Rate (as a percent) | 1.55% | 0.00% |
Stated Interest Rate Range From (as a percent) | 1.54% | |
Stated Interest Rate Range To (as a percent) | 1.55% | |
Outstanding long-term borrowings with the FHLB by contractual maturities | $ 7,292 | $ 0 |
Weighted-Average Rate of outstanding long-term borrowings with the FHLB by contractual maturities | ||
Weighted-Average Interest Rate (as a percent) | 1.55% | 0.00% |
Fixed | 2020 | ||
LONG-TERM BORROWINGS | ||
Weighted-Average Interest Rate (as a percent) | 1.70% | 0.00% |
Stated Interest Rate Range From (as a percent) | 1.62% | |
Stated Interest Rate Range To (as a percent) | 1.79% | |
Outstanding long-term borrowings with the FHLB by contractual maturities | $ 18,333 | $ 0 |
Weighted-Average Rate of outstanding long-term borrowings with the FHLB by contractual maturities | ||
Weighted-Average Interest Rate (as a percent) | 1.70% | 0.00% |
Fixed | 2022 | ||
LONG-TERM BORROWINGS | ||
Weighted-Average Interest Rate (as a percent) | 2.04% | 0.00% |
Stated Interest Rate Range From (as a percent) | 2.0421% | |
Stated Interest Rate Range To (as a percent) | 2.0421% | |
Outstanding long-term borrowings with the FHLB by contractual maturities | $ 3,000 | $ 0 |
Weighted-Average Rate of outstanding long-term borrowings with the FHLB by contractual maturities | ||
Weighted-Average Interest Rate (as a percent) | 2.04% | 0.00% |
LONG-TERM BORROWINGS - Addition
LONG-TERM BORROWINGS - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
LONG-TERM BORROWINGS | ||
FHLB adjustable rate as per the terms of convertible borrowings | three month London Interbank Offered Rate | |
Capital lease, carrying amount of land | $ 827 | $ 827 |
Present value of minimum lease payments | $ 400 | $ 426 |
Capital Lease Obligations | ||
LONG-TERM BORROWINGS | ||
Interest rate for capital lease obligation | 2.75% | |
Revolving line of credit with the FHLB | Luzerne Bank | ||
LONG-TERM BORROWINGS | ||
Remaining borrowing capacity | $ 236,434 | |
Revolving line of credit with the FHLB | Jersey Shore State Bank | ||
LONG-TERM BORROWINGS | ||
Remaining borrowing capacity | $ 145,476 | |
Minimum | ||
LONG-TERM BORROWINGS | ||
Conversion term of FHLB loans | 3 months | |
Maximum | ||
LONG-TERM BORROWINGS | ||
Conversion term of FHLB loans | 5 years |
LONG-TERM BORROWINGS - Future M
LONG-TERM BORROWINGS - Future Minimum Lease Payments (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Lease Payment | ||
2,016 | $ 38 | |
2,017 | 38 | |
2,018 | 38 | |
2,019 | 38 | |
2,020 | 38 | |
Thereafter | 276 | |
Capital leases, future minimum payments due | 466 | |
Interest | ||
2,016 | 11 | |
2,017 | 10 | |
2,018 | 9 | |
2,019 | 9 | |
2,020 | 8 | |
Thereafter | 19 | |
Capital leases, future interest payments due | 66 | |
Present Value of Minimum Lease Payment | ||
2,016 | 27 | |
2,017 | 28 | |
2,018 | 29 | |
2,019 | 29 | |
2,020 | 30 | |
Thereafter | 257 | |
Present value of minimum lease payments | $ 400 | $ 426 |
INCOME TAXES - Schedule of Defe
INCOME TAXES - Schedule of Deferred Tax Assets (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Deferred tax assets: | ||
Allowance for loan losses | $ 3,976,000 | $ 3,380,000 |
Deferred compensation | 1,696,000 | 1,579,000 |
Defined Pension | 1,525,000 | 2,172,000 |
Deferred Loan fees and discounts | 272,000 | 256,000 |
Investment securities allowance | 517,000 | 487,000 |
Low income housing credit carryforward | 1,181,000 | 2,034,000 |
Capital loss carryforward | 0 | 98,000 |
Other | 1,696,000 | 1,578,000 |
Total deferred tax assets | 10,863,000 | 11,584,000 |
Deferred tax liabilities: | ||
Unrealized gain on available for sale securities | 133,000 | 1,510,000 |
Investment security accretion | 231,000 | 262,000 |
Depreciation | 478,000 | 734,000 |
Amortization | 1,031,000 | 977,000 |
Total deferred tax liabilities | 1,873,000 | 3,483,000 |
Deferred tax asset, net | 8,990,000 | 8,101,000 |
Valuation allowance | $ 0 | $ 0 |
INCOME TAXES - Schedule of Comp
INCOME TAXES - Schedule of Components of Income Tax Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Provision or benefit for income taxes | |||||||||||
Currently payable | $ 3,527 | $ 3,680 | $ 3,328 | ||||||||
Deferred benefit | 209 | 124 | 123 | ||||||||
Total provision | $ 1,106 | $ 957 | $ 825 | $ 848 | $ 652 | $ 1,576 | $ 875 | $ 701 | $ 3,736 | $ 3,804 | $ 3,451 |
INCOME TAXES - Schedule of Effe
INCOME TAXES - Schedule of Effective Income Tax Rate (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Effective Income Tax Rate Reconciliation, Amount: | |||||||||||
Provision at expected rate | $ 5,996 | $ 6,260 | $ 5,962 | ||||||||
Decrease in tax resulting from: | |||||||||||
Tax-exempt income | (1,492) | (1,673) | (1,933) | ||||||||
Tax credits | (737) | (737) | (737) | ||||||||
Other, net | (31) | (46) | 159 | ||||||||
Total provision | $ 1,106 | $ 957 | $ 825 | $ 848 | $ 652 | $ 1,576 | $ 875 | $ 701 | $ 3,736 | $ 3,804 | $ 3,451 |
Effective Income Tax Rate Reconciliation, Percent: | |||||||||||
Provision at expected rate (as a percent) | 34.00% | 34.00% | 34.00% | ||||||||
Decrease in tax resulting from: | |||||||||||
Tax-exempt income (as a percent) | (8.46%) | (9.09%) | (11.02%) | ||||||||
Tax credits (as a percent) | (4.17%) | (4.00%) | (4.20%) | ||||||||
Other, net (as a percent) | (0.18%) | (0.25%) | 0.90% | ||||||||
Effective income tax provision (benefit) and rate (as a percent) | 21.19% | 20.66% | 19.68% |
EMPLOYEE BENEFIT PLANS - Additi
EMPLOYEE BENEFIT PLANS - Additional Information (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015USD ($)age | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Number of consecutive years of service and average annual compensation on which benefits are based (in years) | 5 years | ||
Period of employment considered for benefit payments (in years) | 10 years | ||
Accumulated benefit obligation | $ 18,947 | $ 20,296 | |
Vesting period regarding employer contribution (in years) | 5 years | ||
Contribution expense | $ 230 | 171 | $ 132 |
Period for which the Company will make payments under the Deferred Compensation Plan (in years) | 10 years | ||
Threshold age of employees under the plan for company to make payments | age | 65 | ||
Expenses incurred related to the plan | $ 252 | 235 | 169 |
Benefits paid under the plan | 103 | $ 88 | $ 57 |
Minimum | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Expected contribution to Pension Plan | $ 500 | ||
Equity | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Target allocation (as a percent) | 62.00% | ||
Fixed income securities | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Target allocation (as a percent) | 15.00% | ||
Inflation Hedges/Real Assets | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Target allocation (as a percent) | 10.00% | ||
Hedged Strategies | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Target allocation (as a percent) | 10.00% | ||
Cash | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Target allocation (as a percent) | 2.50% |
EMPLOYEE BENEFIT PLANS - Obliga
EMPLOYEE BENEFIT PLANS - Obligation and Funded Status (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Change in benefit obligation: | |||
Benefit obligation at beginning of year | $ 23,450 | $ 18,186 | |
Service cost | 0 | 484 | |
Interest cost | 757 | 859 | $ 770 |
Actuarial gain | (144) | 277 | |
Benefits paid | (639) | (1,660) | |
Curtailment gain | (3,155) | 0 | |
Other, change in actuarial assumptions | 1,322 | (5,304) | |
Benefit obligation at end of year | 18,947 | 23,450 | 18,186 |
Change in plan assets: | |||
Fair value of plan assets at beginning of year | 13,906 | 14,258 | |
Actual return on plan assets | 25 | 487 | |
Employer contribution | 965 | 850 | |
Benefits paid | (704) | (1,736) | |
Adjustment to fair value of plan assets | 31 | 47 | |
Fair value of plan assets at end of year | 14,223 | 13,906 | $ 14,258 |
Funded status | (4,724) | (9,544) | |
Accounts recognized on balance sheet as: | |||
Total liabilities | (4,724) | (9,544) | |
Amounts recognized in accumulated other comprehensive income (loss) consist of: | |||
Net loss | $ 6,267 | $ 6,965 |
EMPLOYEE BENEFIT PLANS - Net Pe
EMPLOYEE BENEFIT PLANS - Net Periodic Costs and Other Amounts Recognized (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Components of Net Periodic Cost and Other Amounts Recognized in other Comprehensive Income, Net periodic pension cost: | |||
Service cost | $ 64 | $ 560 | $ 638 |
Interest cost | 757 | 859 | 770 |
Expected return on plan assets | (983) | (1,153) | (985) |
Amortization of prior service cost | 0 | 0 | 25 |
Amortization of unrecognized net loss | 159 | 209 | 479 |
Net periodic benefit cost | $ (3) | $ 475 | $ 927 |
EMPLOYEE BENEFIT PLANS - Assump
EMPLOYEE BENEFIT PLANS - Assumptions (Details) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract] | |||
Discount rate (as a percent) | 4.17% | 3.83% | 4.75% |
Rate of compensation increase (as a percent) | 3.00% | 3.00% | |
Weighted-average assumptions used to determine net periodic cost | |||
Discount rate (as a percent) | 3.83% | 4.75% | 4.00% |
Expected long-term return on plan assets (as a percent) | 7.00% | 8.00% | 8.00% |
Rate of compensation increase (as a percent) | 3.00% | 3.00% |
EMPLOYEE BENEFIT PLANS - Weight
EMPLOYEE BENEFIT PLANS - Weighted Average Asset Allocations (Details) | Dec. 31, 2015 | Dec. 31, 2014 |
Plan's asset allocations by asset category | ||
Weighted-average asset allocations by asset category (as a percent) | 100.00% | 100.00% |
Cash | ||
Plan's asset allocations by asset category | ||
Weighted-average asset allocations by asset category (as a percent) | 8.56% | 11.54% |
Fixed income securities | ||
Plan's asset allocations by asset category | ||
Weighted-average asset allocations by asset category (as a percent) | 10.33% | 12.46% |
Equity | ||
Plan's asset allocations by asset category | ||
Weighted-average asset allocations by asset category (as a percent) | 61.73% | 76.00% |
Inflation Hedges/Real Assets | ||
Plan's asset allocations by asset category | ||
Weighted-average asset allocations by asset category (as a percent) | 5.03% | 0.00% |
Hedged Strategies | ||
Plan's asset allocations by asset category | ||
Weighted-average asset allocations by asset category (as a percent) | 14.35% | 0.00% |
EMPLOYEE BENEFIT PLANS - Fair V
EMPLOYEE BENEFIT PLANS - Fair Value Hierarchy (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Defined Benefit Plan Disclosure [Line Items] | |||
Assets at fair value | $ 14,223 | $ 13,906 | $ 14,258 |
Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Assets at fair value | 14,223 | 13,906 | |
Cash and cash equivalents | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Assets at fair value | 1,218 | 1,606 | |
Cash and cash equivalents | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Assets at fair value | 1,218 | 1,606 | |
Mutual funds - taxable fixed income | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Assets at fair value | 1,467 | 1,732 | |
Mutual funds - taxable fixed income | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Assets at fair value | 1,467 | 1,732 | |
Mutual funds - domestic equity | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Assets at fair value | 8,150 | 8,372 | |
Mutual funds - domestic equity | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Assets at fair value | 8,150 | 8,372 | |
Mutual funds - international equity | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Assets at fair value | 631 | 2,196 | |
Mutual funds - international equity | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Assets at fair value | 631 | $ 2,196 | |
Inflation Hedges/Real Assets | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Assets at fair value | 715 | ||
Inflation Hedges/Real Assets | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Assets at fair value | 715 | ||
Hedged Strategies | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Assets at fair value | 2,042 | ||
Hedged Strategies | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Assets at fair value | $ 2,042 |
EMPLOYEE BENEFIT PLANS - Future
EMPLOYEE BENEFIT PLANS - Future Benefit Payments (Details) $ in Thousands | Dec. 31, 2015USD ($) |
Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract] | |
2,016 | $ 783 |
2,017 | 799 |
2,018 | 812 |
2,019 | 848 |
2,020 | 882 |
Thereafter | 4,734 |
Total | $ 8,858 |
STOCK OPTIONS - Additional Info
STOCK OPTIONS - Additional Information (Details) - USD ($) | Aug. 27, 2015 | Sep. 30, 2015 | Dec. 31, 2015 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Grants in period (in shares) | 38,750 | 38,750 | 38,750 |
Granted (in dollars per share) | $ 42.03 | $ 42.03 | |
Allocated share-based compensation expense | $ 19,000 | ||
Employee Stock Option | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period (in years) | 5 years | ||
Expiration period (in years) | 10 years | ||
Nonvested awards, compensation cost not yet recognized | $ 119,000 | ||
Period for recognition (in years) | 4 years 7 months 28 days |
STOCK OPTIONS - Stock Option Ac
STOCK OPTIONS - Stock Option Activity (Details) - $ / shares | Aug. 27, 2015 | Sep. 30, 2015 | Dec. 31, 2015 | Dec. 31, 2014 |
Shares | ||||
Outstanding, beginning of year (in shares) | 0 | |||
Granted (in shares) | 38,750 | 38,750 | 38,750 | |
Exercised (in shares) | 0 | |||
Forfeited (in shares) | (4,000) | |||
Outstanding, end of year (in shares) | 34,750 | |||
Weighted Average Exercise Price | ||||
Outstanding (in dollars per share) | $ 42.03 | $ 0 | ||
Granted (in dollars per share) | $ 42.03 | 42.03 | ||
Exercised (in dollars per share) | 0 | |||
Forfeited (in dollars per share) | $ 42.03 |
STOCK OPTIONS - Stock Option As
STOCK OPTIONS - Stock Option Assumptions (Details) - Employee Stock Option | 12 Months Ended |
Dec. 31, 2015$ / shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Risk-free interest rate | 1.63% |
Expected volatility | 31.58% |
Expected dividend yield | 4.22% |
Expected life (in years) | 7 years 6 months 4 days |
Weighted average grant date fair value per option (in dollars per share) | $ 3.96 |
EMPLOYEE STOCK PURCHASE PLAN (D
EMPLOYEE STOCK PURCHASE PLAN (Details) - Employee Stock Purchase Plan ("Plan") - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares allowed to be purchased by employees (in shares) | 1,000,000 | |
Purchase price of the shares with respect to market value | 95.00% | |
Maximum percentage of base compensation | 15.00% | |
Maximum market value | $ 12,000 | |
Number of shares issued under the plan (in shares) | 2,335 | 2,720 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - Directors and executive officers - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
RELATED PARTY TRANSACTIONS | ||
Threshold ownership interest for principal owners (more than) | 10.00% | |
Loan activity with executive officers, directors, principal shareholders, and associates of such persons | ||
Beginning Balance | $ 8,946 | $ 10,955 |
New Loans | 8,693 | 7,920 |
Repayments | (8,381) | (9,929) |
Ending Balance | 9,258 | 8,946 |
Deposits from related parties | $ 13,330 | $ 10,703 |
COMMITMENTS AND CONTINGENT L104
COMMITMENTS AND CONTINGENT LIABILITIES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Future minimum rental payments under operating leases with noncancellable terms in excess of one year | |||
2,016 | $ 482 | ||
2,017 | 429 | ||
2,018 | 365 | ||
2,019 | 248 | ||
2,020 | 228 | ||
Thereafter | 823 | ||
Total | 2,575 | ||
Rental expense for all operating leases | $ 591 | $ 523 | $ 493 |
OFF-BALANCE SHEET RISK (Details
OFF-BALANCE SHEET RISK (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Commitments to extend credit | ||
Off Balance Sheet Risk | ||
Contract amounts representing credit risk | $ 241,936 | $ 235,940 |
Standby letters of credit | ||
Off Balance Sheet Risk | ||
Contract amounts representing credit risk | $ 4,786 | $ 7,490 |
Coverage period for instrument (in years) | 1 year |
CAPITAL REQUIREMENTS (Details)
CAPITAL REQUIREMENTS (Details) $ in Thousands | Dec. 31, 2015USD ($)category | Dec. 31, 2014USD ($) |
Banking and Thrift [Abstract] | ||
Capital categories established by FDICIA (in categories) | category | 5 | |
Common Equity Tier I Capital (to Risk-weighted Assets), Ratio | ||
To Be Well Capitalized (as a percent) | 6.50% | |
Total Capital (to Risk-weighted Assets), Ratio | ||
To Be Well Capitalized (as a percent) | 10.00% | |
Tier I Capital (to Risk-weighted Assets), Ratio | ||
To Be Well Capitalized (as a percent) | 8.00% | |
Tier I Capital (to Average Assets), Ratio | ||
To Be Well Capitalized (as a percent) | 5.00% | |
Consolidated Company | ||
Common Equity Tier I Capital (to Risk-weighted Assets), Amount | ||
Actual | $ 121,665 | |
For Capital Adequacy Purposes | 48,722 | |
To Be Well Capitalized | $ 70,377 | |
Common Equity Tier I Capital (to Risk-weighted Assets), Ratio | ||
Actual (as a percent) | 11.24% | |
For Capital Adequacy Purposes (as a percent) | 4.50% | |
To Be Well Capitalized (as a percent) | 6.50% | |
Total Capital (to Risk-weighted Assets), Amount | ||
Actual | $ 134,067 | $ 123,371 |
For Capital Adequacy Purposes | 86,617 | 78,019 |
To Be Well Capitalized | $ 108,272 | $ 97,524 |
Total Capital (to Risk-weighted Assets), Ratio | ||
Actual (as a percent) | 12.38% | 12.65% |
For Capital Adequacy Purposes (as a percent) | 8.00% | 8.00% |
To Be Well Capitalized (as a percent) | 10.00% | 10.00% |
Tier I Capital (to Risk-weighted Assets), Amount | ||
Actual | $ 121,665 | $ 112,290 |
For Capital Adequacy Purposes | 64,963 | 39,010 |
To Be Well Capitalized | $ 86,617 | $ 58,514 |
Tier I Capital (to Risk-weighted Assets), Ratio | ||
Actual (as a percent) | 11.24% | 11.51% |
For Capital Adequacy Purposes (as a percent) | 6.00% | 4.00% |
To Be Well Capitalized (as a percent) | 8.00% | 6.00% |
Tier I Capital (to Average Assets), Amount | ||
Actual | $ 121,665 | $ 112,290 |
For Capital Adequacy Purposes | 51,862 | 48,476 |
To Be Well Capitalized | $ 64,828 | $ 60,595 |
Tier I Capital (to Average Assets), Ratio | ||
Actual (as a percent) | 9.38% | 9.27% |
For Capital Adequacy Purposes (as a percent) | 4.00% | 4.00% |
To Be Well Capitalized (as a percent) | 5.00% | 5.00% |
Jersey Shore State Bank | ||
Common Equity Tier I Capital (to Risk-weighted Assets), Amount | ||
Actual | $ 82,682 | |
For Capital Adequacy Purposes | 34,773 | |
To Be Well Capitalized | $ 50,227 | |
Common Equity Tier I Capital (to Risk-weighted Assets), Ratio | ||
Actual (as a percent) | 10.70% | |
For Capital Adequacy Purposes (as a percent) | 4.50% | |
To Be Well Capitalized (as a percent) | 6.50% | |
Total Capital (to Risk-weighted Assets), Amount | ||
Actual | $ 92,036 | $ 83,183 |
For Capital Adequacy Purposes | 61,818 | 54,086 |
To Be Well Capitalized | $ 77,272 | $ 67,608 |
Total Capital (to Risk-weighted Assets), Ratio | ||
Actual (as a percent) | 11.91% | 12.30% |
For Capital Adequacy Purposes (as a percent) | 8.00% | 8.00% |
To Be Well Capitalized (as a percent) | 10.00% | 10.00% |
Tier I Capital (to Risk-weighted Assets), Amount | ||
Actual | $ 82,682 | $ 74,730 |
For Capital Adequacy Purposes | 46,363 | 27,043 |
To Be Well Capitalized | $ 61,818 | $ 40,565 |
Tier I Capital (to Risk-weighted Assets), Ratio | ||
Actual (as a percent) | 10.70% | 11.05% |
For Capital Adequacy Purposes (as a percent) | 6.00% | 4.00% |
To Be Well Capitalized (as a percent) | 8.00% | 6.00% |
Tier I Capital (to Average Assets), Amount | ||
Actual | $ 82,682 | $ 74,730 |
For Capital Adequacy Purposes | 38,175 | 35,175 |
To Be Well Capitalized | $ 47,719 | $ 43,968 |
Tier I Capital (to Average Assets), Ratio | ||
Actual (as a percent) | 8.66% | 8.50% |
For Capital Adequacy Purposes (as a percent) | 4.00% | 4.00% |
To Be Well Capitalized (as a percent) | 5.00% | 5.00% |
Luzerne Bank | ||
Common Equity Tier I Capital (to Risk-weighted Assets), Amount | ||
Actual | $ 30,549 | |
For Capital Adequacy Purposes | 12,901 | |
To Be Well Capitalized | $ 18,635 | |
Common Equity Tier I Capital (to Risk-weighted Assets), Ratio | ||
Actual (as a percent) | 10.66% | |
For Capital Adequacy Purposes (as a percent) | 4.50% | |
To Be Well Capitalized (as a percent) | 6.50% | |
Total Capital (to Risk-weighted Assets), Amount | ||
Actual | $ 33,274 | $ 29,856 |
For Capital Adequacy Purposes | 22,935 | 23,341 |
To Be Well Capitalized | $ 28,669 | $ 29,176 |
Total Capital (to Risk-weighted Assets), Ratio | ||
Actual (as a percent) | 11.61% | 10.23% |
For Capital Adequacy Purposes (as a percent) | 8.00% | 8.00% |
To Be Well Capitalized (as a percent) | 10.00% | 10.00% |
Tier I Capital (to Risk-weighted Assets), Amount | ||
Actual | $ 30,549 | $ 27,886 |
For Capital Adequacy Purposes | 17,201 | 11,670 |
To Be Well Capitalized | $ 22,935 | $ 17,506 |
Tier I Capital (to Risk-weighted Assets), Ratio | ||
Actual (as a percent) | 10.66% | 9.56% |
For Capital Adequacy Purposes (as a percent) | 6.00% | 4.00% |
To Be Well Capitalized (as a percent) | 8.00% | 6.00% |
Tier I Capital (to Average Assets), Amount | ||
Actual | $ 30,549 | $ 27,886 |
For Capital Adequacy Purposes | 13,725 | 13,032 |
To Be Well Capitalized | $ 17,157 | $ 16,289 |
Tier I Capital (to Average Assets), Ratio | ||
Actual (as a percent) | 8.90% | 8.56% |
For Capital Adequacy Purposes (as a percent) | 4.00% | 4.00% |
To Be Well Capitalized (as a percent) | 5.00% | 5.00% |
REGULATORY RESTRICTIONS (Detail
REGULATORY RESTRICTIONS (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Pennsylvania Banking Code | ||
REGULATORY RESTRICTIONS | ||
Regulatory lending limit | $ 16,985,000 | |
Jersey Shore State Bank | ||
Cash and Due from Banks | ||
Reserves required by the district Federal Reserve Bank included in cash and due from banks | 0 | $ 0 |
Jersey Shore State Bank | Pennsylvania Banking Code | ||
REGULATORY RESTRICTIONS | ||
Balance in the additional paid in capital account unavailable for dividends | 11,657,000 | |
Luzerne National Bank Corporation | ||
Cash and Due from Banks | ||
Reserves required by the district Federal Reserve Bank included in cash and due from banks | 0 | $ 0 |
Luzerne National Bank Corporation | Pennsylvania Banking Code | ||
REGULATORY RESTRICTIONS | ||
Balance in the additional paid in capital account unavailable for dividends | $ 42,214,000 |
FAIR VALUE MEASUREMENTS - Fair
FAIR VALUE MEASUREMENTS - Fair Value on a Recurring and Non-recurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Fair Value Measurements | ||
Investment securities available for sale, at fair value | $ 176,157 | $ 232,213 |
Investment securities, trading | 73 | 0 |
U.S. Government and agency securities | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 3,549 | 3,841 |
Mortgage-backed securities | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 10,009 | 12,697 |
Asset-backed securities | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 1,940 | 2,492 |
State and political securities | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 86,555 | 108,116 |
Other debt securities | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 57,772 | 89,463 |
Financial institution equity securities | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 11,483 | 9,915 |
Equity | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 16,332 | 15,604 |
Investment securities, trading | 73 | |
Level 1 | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 16,332 | 15,604 |
Investment securities, trading | 73 | |
Level 2 | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 159,825 | 216,609 |
Recurring | ||
Fair Value Measurements | ||
Total assets | 176,230 | 232,213 |
Recurring | U.S. Government and agency securities | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 3,549 | 3,841 |
Recurring | Mortgage-backed securities | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 10,009 | 12,697 |
Recurring | Asset-backed securities | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 1,940 | 2,492 |
Recurring | State and political securities | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 86,555 | 108,116 |
Recurring | Other debt securities | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 57,772 | 89,463 |
Recurring | Financial institution equity securities | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 11,483 | 9,915 |
Investment securities, trading | 73 | |
Recurring | Equity | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 4,849 | 5,689 |
Recurring | Level 1 | ||
Fair Value Measurements | ||
Total assets | 16,405 | 15,604 |
Recurring | Level 1 | Financial institution equity securities | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 11,483 | 9,915 |
Investment securities, trading | 73 | |
Recurring | Level 1 | Equity | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 4,849 | 5,689 |
Recurring | Level 2 | ||
Fair Value Measurements | ||
Total assets | 159,825 | 216,609 |
Recurring | Level 2 | U.S. Government and agency securities | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 3,549 | 3,841 |
Recurring | Level 2 | Mortgage-backed securities | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 10,009 | 12,697 |
Recurring | Level 2 | Asset-backed securities | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 1,940 | 2,492 |
Recurring | Level 2 | State and political securities | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 86,555 | 108,116 |
Recurring | Level 2 | Other debt securities | ||
Fair Value Measurements | ||
Investment securities available for sale, at fair value | 57,772 | 89,463 |
Non-recurring | ||
Fair Value Measurements | ||
Total assets | 15,475 | 18,724 |
Non-recurring | Impaired loans | ||
Fair Value Measurements | ||
Total assets | 13,779 | 15,483 |
Non-recurring | Other real estate owned | ||
Fair Value Measurements | ||
Total assets | 1,696 | 3,241 |
Non-recurring | Level 3 | ||
Fair Value Measurements | ||
Total assets | 15,475 | 18,724 |
Non-recurring | Level 3 | Impaired loans | ||
Fair Value Measurements | ||
Total assets | 13,779 | 15,483 |
Non-recurring | Level 3 | Other real estate owned | ||
Fair Value Measurements | ||
Total assets | $ 1,696 | $ 3,241 |
FAIR VALUE MEASUREMENTS - List
FAIR VALUE MEASUREMENTS - List of Significant Unobservable Inputs (Details) - Non-recurring - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Fair Value | $ 15,475 | $ 18,724 |
Impaired loans | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Fair Value | 13,779 | 15,483 |
Other real estate owned | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Fair Value | 1,696 | 3,241 |
Level 3 | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Fair Value | 15,475 | 18,724 |
Level 3 | Impaired loans | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Fair Value | $ 13,779 | $ 15,483 |
Probability of default (as a percent) | 0.00% | 0.00% |
Level 3 | Impaired loans | Discounted cash flow | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Fair Value | $ 5,696 | $ 4,749 |
Level 3 | Impaired loans | Discounted cash flow | Minimum | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Temporary reduction in payment amount (as a percent) | 0.00% | 0.00% |
Level 3 | Impaired loans | Discounted cash flow | Maximum | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Temporary reduction in payment amount (as a percent) | (70.00%) | (91.00%) |
Level 3 | Impaired loans | Discounted cash flow | Weighted Average | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Temporary reduction in payment amount (as a percent) | (17.00%) | (12.00%) |
Level 3 | Impaired loans | Appraisal of collateral | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Fair Value | $ 8,083 | $ 10,734 |
Level 3 | Impaired loans | Appraisal of collateral | Minimum | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Appraisal adjustments (as a percent) | 0.00% | 0.00% |
Level 3 | Impaired loans | Appraisal of collateral | Maximum | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Appraisal adjustments (as a percent) | (20.00%) | (20.00%) |
Level 3 | Impaired loans | Appraisal of collateral | Weighted Average | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Appraisal adjustments (as a percent) | (15.00%) | (15.00%) |
Level 3 | Other real estate owned | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Fair Value | $ 1,696 | $ 3,241 |
Level 3 | Other real estate owned | Appraisal of collateral | ||
Listing of significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques | ||
Fair Value | $ 1,696 | $ 3,241 |
FAIR VALUE OF FINANCIAL INST110
FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Investment securities | ||
Investment securities available for sale, at fair value | $ 176,157 | $ 232,213 |
Investment securities, trading | 73 | 0 |
Bank-owned life insurance | 26,667 | 25,959 |
Accrued interest receivable | 3,686 | 3,912 |
Financial liabilities | ||
Interest-bearing deposits | 751,797 | 738,041 |
Noninterest-bearing deposits | 280,083 | 243,378 |
Quoted Prices in Active Markets for Identical Assets (Level I) | ||
Financial assets | ||
Cash and cash equivalents | 22,796 | 19,908 |
Investment securities | ||
Investment securities available for sale, at fair value | 16,332 | 15,604 |
Investment securities, trading | 73 | |
Loans held for sale | 757 | 550 |
Bank-owned life insurance | 26,667 | 25,959 |
Accrued interest receivable | 3,686 | 3,912 |
Financial liabilities | ||
Interest-bearing deposits | 509,206 | 506,875 |
Noninterest-bearing deposits | 280,083 | 243,378 |
Short-term borrowings | 46,638 | 40,818 |
Accrued interest payable | 426 | 381 |
Significant Other Observable Inputs (Level II) | ||
Investment securities | ||
Investment securities available for sale, at fair value | 159,825 | 216,609 |
Significant Unobservable Inputs (Level III) | ||
Investment securities | ||
Loans, net | 1,045,140 | 916,597 |
Financial liabilities | ||
Interest-bearing deposits | 220,479 | 215,849 |
Long-term borrowings | 91,783 | 73,084 |
Carrying Value | ||
Financial assets | ||
Cash and cash equivalents | 22,796 | 19,908 |
Investment securities | ||
Investment securities available for sale, at fair value | 176,157 | 232,213 |
Investment securities, trading | 73 | |
Loans held for sale | 757 | 550 |
Loans, net | 1,033,163 | 905,000 |
Bank-owned life insurance | 26,667 | 25,959 |
Accrued interest receivable | 3,686 | 3,912 |
Financial liabilities | ||
Interest-bearing deposits | 751,797 | 738,041 |
Noninterest-bearing deposits | 280,083 | 243,378 |
Short-term borrowings | 46,638 | 40,818 |
Long-term borrowings | 91,025 | 71,176 |
Accrued interest payable | 426 | 381 |
Fair Value | ||
Financial assets | ||
Cash and cash equivalents | 22,796 | 19,908 |
Investment securities | ||
Investment securities available for sale, at fair value | 176,157 | 232,213 |
Investment securities, trading | 73 | |
Loans held for sale | 757 | 550 |
Loans, net | 1,045,140 | 916,597 |
Bank-owned life insurance | 26,667 | 25,959 |
Accrued interest receivable | 3,686 | 3,912 |
Financial liabilities | ||
Interest-bearing deposits | 729,685 | 722,724 |
Noninterest-bearing deposits | 280,083 | 243,378 |
Short-term borrowings | 46,638 | 40,818 |
Long-term borrowings | 91,783 | 73,084 |
Accrued interest payable | $ 426 | $ 381 |
PARENT COMPANY ONLY FINANCIA111
PARENT COMPANY ONLY FINANCIAL STATEMENTS - Condensed Balance Sheet (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Investment in subsidiaries: | ||||
Other assets | $ 6,695 | $ 8,139 | ||
TOTAL ASSETS | 1,320,057 | 1,245,011 | ||
LIABILITIES AND SHAREHOLDERS’ EQUITY: | ||||
Other liabilities | 13,809 | 15,250 | ||
Shareholders’ equity | 136,279 | 135,967 | $ 127,815 | $ 93,726 |
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | 1,320,057 | 1,245,011 | ||
Penns Woods Bancorp, Inc | ||||
ASSETS: | ||||
Cash | 263 | 1,299 | ||
Investment in subsidiaries: | ||||
Bank | 127,126 | 125,524 | ||
Non-bank | 8,332 | 8,900 | ||
Other assets | 705 | 380 | ||
TOTAL ASSETS | 136,426 | 136,103 | ||
LIABILITIES AND SHAREHOLDERS’ EQUITY: | ||||
Other liabilities | 147 | 136 | ||
Shareholders’ equity | 136,279 | 135,967 | ||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ 136,426 | $ 136,103 |
PARENT COMPANY ONLY FINANCIA112
PARENT COMPANY ONLY FINANCIAL STATEMENTS - Condensed Income Statement (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Operating income: | |||||||||||
Security gains | $ 894 | $ 493 | $ 522 | $ 661 | $ 490 | $ 2,145 | $ 487 | $ 393 | |||
NET INCOME | $ 3,746 | $ 3,364 | $ 3,433 | $ 3,355 | $ 2,883 | $ 4,793 | $ 3,463 | $ 3,469 | $ 13,898 | $ 14,608 | $ 14,084 |
Comprehensive income | 11,766 | 17,835 | 3,833 | ||||||||
Penns Woods Bancorp, Inc | |||||||||||
Operating income: | |||||||||||
Dividends from subsidiaries | 11,367 | 10,080 | 14,836 | ||||||||
Security gains | 0 | 3 | 0 | ||||||||
Equity in undistributed earnings of subsidiaries | 3,167 | 5,261 | 346 | ||||||||
Operating expenses | (636) | (736) | (1,098) | ||||||||
NET INCOME | 13,898 | 14,608 | 14,084 | ||||||||
Comprehensive income | $ 11,766 | $ 17,835 | $ 3,833 |
PARENT COMPANY ONLY FINANCIA113
PARENT COMPANY ONLY FINANCIAL STATEMENTS - Condensed Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
OPERATING ACTIVITIES: | |||||||||||
Net income | $ 3,746 | $ 3,364 | $ 3,433 | $ 3,355 | $ 2,883 | $ 4,793 | $ 3,463 | $ 3,469 | $ 13,898 | $ 14,608 | $ 14,084 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
Other, net | (1,630) | 423 | 61 | ||||||||
Net cash provided by operating activities | 15,735 | 18,738 | 17,327 | ||||||||
INVESTING ACTIVITIES: | |||||||||||
Outlays for business acquisitions | 0 | 0 | 17,487 | ||||||||
FINANCING ACTIVITIES: | |||||||||||
Dividends paid | (8,967) | (9,055) | (9,560) | ||||||||
Issuance of common stock | 116 | 119 | 80 | ||||||||
Purchase of treasury stock | (2,603) | (747) | 0 | ||||||||
Net cash provided by financing activities | 64,676 | 12,810 | 30,210 | ||||||||
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | 2,888 | (4,698) | 9,464 | ||||||||
CASH AND CASH EQUIVALENTS, BEGINNING | 19,908 | 24,606 | 19,908 | 24,606 | 15,142 | ||||||
CASH AND CASH EQUIVALENTS, ENDING | 22,796 | 19,908 | 22,796 | 19,908 | 24,606 | ||||||
Penns Woods Bancorp, Inc | |||||||||||
OPERATING ACTIVITIES: | |||||||||||
Net income | 13,898 | 14,608 | 14,084 | ||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
Equity in undistributed earnings of subsidiaries | (3,167) | (5,261) | (346) | ||||||||
Other, net | (313) | (50) | 97 | ||||||||
Net cash provided by operating activities | 10,418 | 9,297 | 13,835 | ||||||||
INVESTING ACTIVITIES: | |||||||||||
Outlays for business acquisitions | 0 | 0 | (2,876) | ||||||||
FINANCING ACTIVITIES: | |||||||||||
Dividends paid | (8,967) | (9,055) | (9,560) | ||||||||
Issuance of common stock | 116 | 118 | 80 | ||||||||
Purchase of treasury stock | (2,603) | (747) | 0 | ||||||||
Net cash provided by financing activities | (11,454) | (9,684) | (9,480) | ||||||||
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | (1,036) | (387) | 1,479 | ||||||||
CASH AND CASH EQUIVALENTS, BEGINNING | $ 1,299 | $ 1,686 | 1,299 | 1,686 | 207 | ||||||
CASH AND CASH EQUIVALENTS, ENDING | $ 263 | $ 1,299 | $ 263 | $ 1,299 | $ 1,686 |
CONSOLIDATED QUARTERLY FINAN114
CONSOLIDATED QUARTERLY FINANCIAL DATA (UNAUDITED) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Interest income | $ 11,675 | $ 11,523 | $ 11,529 | $ 11,397 | $ 11,460 | $ 11,460 | $ 11,357 | $ 11,329 | |||
Interest expense | 1,337 | 1,289 | 1,307 | 1,286 | 1,252 | 1,242 | 1,226 | 1,242 | $ 5,219 | $ 4,962 | $ 5,264 |
NET INTEREST INCOME | 10,338 | 10,234 | 10,222 | 10,111 | 10,208 | 10,218 | 10,131 | 10,087 | 40,905 | 40,644 | 38,035 |
Provision for loan losses | 480 | 520 | 600 | 700 | 1,605 | 460 | 300 | 485 | 2,300 | 2,850 | 2,275 |
Non-interest income, excluding securities gains | 2,417 | 2,644 | 2,535 | 2,599 | 2,954 | 2,779 | 2,442 | 2,818 | 12,765 | 14,508 | 12,042 |
Security gains | 894 | 493 | 522 | 661 | 490 | 2,145 | 487 | 393 | |||
Non-interest expense | 8,317 | 8,530 | 8,421 | 8,468 | 8,512 | 8,313 | 8,422 | 8,643 | 33,736 | 33,890 | 30,267 |
INCOME BEFORE INCOME TAX PROVISION | 4,852 | 4,321 | 4,258 | 4,203 | 3,535 | 6,369 | 4,338 | 4,170 | 17,634 | 18,412 | 17,535 |
Income tax provision | 1,106 | 957 | 825 | 848 | 652 | 1,576 | 875 | 701 | 3,736 | 3,804 | 3,451 |
NET INCOME | $ 3,746 | $ 3,364 | $ 3,433 | $ 3,355 | $ 2,883 | $ 4,793 | $ 3,463 | $ 3,469 | $ 13,898 | $ 14,608 | $ 14,084 |
Earnings per share - basic and diluted (in dollars per share) | $ 0.79 | $ 0.71 | $ 0.72 | $ 0.70 | $ 0.60 | $ 0.99 | $ 0.72 | $ 0.72 | $ 2.91 | $ 3.03 | $ 3.19 |
ACQUISITION OF LUZERNE NATIO115
ACQUISITION OF LUZERNE NATIONAL BANK CORPORATION (Details) $ / shares in Units, $ in Thousands | Jun. 01, 2013USD ($)loan_officebranch_office$ / sharesshares | Dec. 31, 2015USD ($)shares | Dec. 31, 2014USD ($) |
Acquisition of Luzerne National Bank Corporation | |||
Purchased credit-impaired loans | $ 15,883 | $ 17,576 | |
Loan portfolio without evidence of deterioration | 1,033,163 | 905,000 | |
Adjustments to reflect liabilities acquired at fair value: | |||
Goodwill resulting from merger | $ 17,104 | $ 17,104 | |
Luzerne National Bank Corporation | |||
Acquisition of Luzerne National Bank Corporation | |||
Number of branch offices acquired | branch_office | 8 | ||
Number of loan production offices acquired | loan_office | 1 | ||
Percentage of the total shares outstanding, issued | 20.62% | ||
Purchased credit-impaired loans | $ 1,211 | ||
Non-accretable difference on purchased credit-impaired loans | 842 | ||
Loan portfolio without evidence of deterioration | 249,789 | ||
Loan portfolio without evidence of deterioration at fair value | $ 249,500 | ||
Purchase Price Consideration in Common Stock | |||
Luzerne National Bank Corporation common shares settled for stock (in shares) | shares | 630,216 | ||
Exchange Ratio | 1.5534 | ||
Penns Woods Bancorp, Inc. shares issued (in shares) | shares | 978,977 | 978,977 | |
Value assigned to Penns Woods Bancorp, Inc. common share (in dollars per share) | $ / shares | $ 40.59 | ||
Purchase price assigned to Luzerne National Bank Corporation common shares exchanged for Penns Woods Bancorp, Inc. | $ 39,736 | ||
Purchase Price Consideration - Cash for Common Stock | |||
Luzerne National Bank Corporation shares exchanged for cash (in shares) | shares | 46,480 | ||
Purchase price paid to each Luzerne National Bank Corporation common share exchanged for cash (in dollars per share) | $ / shares | $ 61.86 | ||
Purchase price assigned to Luzerne National Bank Corporation common shares exchanged for cash | $ 2,876 | ||
Purchase price | 42,612 | ||
Net Assets Acquired: | |||
Luzerne National Bank Corporation shareholders’ equity | 27,371 | ||
Adjustments to reflect assets acquired at fair value: | |||
Investments | 33 | ||
Loans | |||
Interest rate | 2,680 | ||
General credit | (3,206) | ||
Specific credit - non-amortizing | (58) | ||
Specific credit - amortizing | (40) | ||
Core deposit intangible | 1,882 | ||
Trade name intangible | 133 | ||
Owned premises | 1,138 | ||
Leased premises contracts | 122 | ||
Deferred tax assets | (603) | ||
Adjustments to reflect liabilities acquired at fair value: | |||
Time deposits | (912) | ||
Net assets acquired | 28,540 | ||
Goodwill resulting from merger | $ 14,072 |