Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2022 | Oct. 31, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2022 | |
Entity File Number | 001-13695 | |
Entity Registrant Name | COMMUNITY BANK SYSTEM, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 16-1213679 | |
Entity Address, Address Line One | 5790 Widewaters Parkway | |
Entity Address, City or Town | DeWitt | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 13214 | |
City Area Code | 315 | |
Local Phone Number | 445-2282 | |
Title of 12(b) Security | Common Stock, $1.00 par value per share | |
Trading Symbol | CBU | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 53,734,397 | |
Entity Central Index Key | 0000723188 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
CONSOLIDATED STATEMENTS OF COND
CONSOLIDATED STATEMENTS OF CONDITION - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Assets: | ||
Cash and cash equivalents | $ 247,391 | $ 1,875,064 |
Available-for-sale investment securities includes pledged securities that can be sold or repledged of $427,164 and $485,414, respectively (cost of $6,136,544 and $4,980,102, respectively) | 5,170,689 | 4,934,210 |
Equity and other securities (cost of $55,665 and $43,917, respectively) | 56,603 | 44,879 |
Loans, net | 8,543,607 | 7,373,639 |
Allowance for credit losses | (60,363) | (49,869) |
Net loans | 8,483,244 | 7,323,770 |
Goodwill | 844,984 | 799,109 |
Core deposit intangibles, net | 13,550 | 9,087 |
Other intangibles, net | 50,690 | 56,139 |
Goodwill and intangible assets, net | 909,224 | 864,335 |
Premises and equipment, net | 161,966 | 160,651 |
Accrued interest and fees receivable | 41,627 | 35,894 |
Other assets | 523,803 | 313,854 |
Total assets | 15,594,547 | 15,552,657 |
Liabilities: | ||
Noninterest-bearing deposits | 4,281,859 | 3,921,663 |
Interest-bearing deposits | 9,204,462 | 8,989,505 |
Total deposits | 13,486,321 | 12,911,168 |
Overnight borrowings | 119,800 | 0 |
Securities sold under agreement to repurchase, short-term | 352,772 | 324,720 |
Other Federal Home Loan Bank borrowings | 19,472 | 1,888 |
Subordinated notes payable | 3,256 | 3,277 |
Accrued interest and other liabilities | 151,763 | 210,797 |
Total liabilities | 14,133,384 | 13,451,850 |
Commitments and contingencies (See Note J) | ||
Shareholders' equity: | ||
Preferred stock, $1.00 par value, 500,000 shares authorized, 0 shares issued | 0 | 0 |
Common stock, $1.00 par value, 75,000,000 shares authorized; 54,188,008 and 54,092,421 shares issued, respectively | 54,188 | 54,092 |
Additional paid-in capital | 1,048,444 | 1,041,304 |
Retained earnings | 1,123,641 | 1,058,286 |
Accumulated other comprehensive loss | (746,381) | (50,627) |
Treasury stock, at cost (451,992 shares, including 134,477 shares held by deferred compensation arrangements at September 30, 2022 and 214,374 shares including 146,860 shares held by deferred compensation arrangements at December 31, 2021, respectively) | (26,426) | (10,610) |
Deferred compensation arrangements (134,477 and 146,860 shares, respectively) | 7,697 | 8,362 |
Total shareholders' equity | 1,461,163 | 2,100,807 |
Total liabilities and shareholders' equity | $ 15,594,547 | $ 15,552,657 |
CONSOLIDATED STATEMENTS OF CO_2
CONSOLIDATED STATEMENTS OF CONDITION (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Assets: | ||
Available-for-sale investment securities, pledged amount | $ 427,164 | $ 485,414 |
Available-for-sale investment securities, cost | 6,136,544 | 4,980,102 |
Equity and other securities, cost | $ 55,665 | $ 43,917 |
Shareholders' equity: | ||
Preferred stock, par value (in dollars per share) | $ 1 | $ 1 |
Preferred stock, shares authorized | 500,000 | 500,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in dollars per share) | $ 1 | $ 1 |
Common stock, shares authorized | 75,000,000 | 75,000,000 |
Common stock, shares issued | 54,188,008 | 54,092,421 |
Treasury stock, shares at cost | 451,992 | 214,374 |
Shares held by deferred compensation arrangements | 134,477 | 146,860 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Interest income: | ||||
Interest and fees on loans | $ 88,434 | $ 75,825 | $ 238,907 | $ 231,446 |
Interest and dividends on taxable investments | 23,737 | 17,361 | 71,228 | 49,325 |
Interest and dividends on nontaxable investments | 3,704 | 2,480 | 9,611 | 7,920 |
Total interest income | 115,875 | 95,666 | 319,746 | 288,691 |
Interest expense: | ||||
Interest on deposits | 3,855 | 2,822 | 9,111 | 8,897 |
Interest on borrowings | 1,588 | 195 | 2,113 | 716 |
Interest on subordinated notes payable | 38 | 38 | 115 | 115 |
Interest on subordinated debt held by unconsolidated subsidiary trusts | 0 | 0 | 0 | 293 |
Total interest expense | 5,481 | 3,055 | 11,339 | 10,021 |
Net interest income | 110,394 | 92,611 | 308,407 | 278,670 |
Provision for credit losses | 5,061 | (944) | 12,005 | (11,001) |
Net interest income after provision for credit losses | 105,333 | 93,555 | 296,402 | 289,671 |
Noninterest revenues: | ||||
Deposit service fees | 17,452 | 15,442 | 49,745 | 43,758 |
Mortgage banking | 171 | 460 | 595 | 1,479 |
Other banking services | 912 | 996 | 2,521 | 2,830 |
Employee benefit services | 27,884 | 29,923 | 86,385 | 83,933 |
Insurance services | 11,332 | 9,176 | 31,521 | 25,538 |
Wealth management services | 7,502 | 8,322 | 24,276 | 24,748 |
Unrealized (loss) gain on equity securities | (4) | (10) | (24) | 14 |
Total noninterest revenues | 65,249 | 64,309 | 195,019 | 182,300 |
Noninterest expenses: | ||||
Salaries and employee benefits | 66,190 | 62,883 | 193,236 | 178,407 |
Occupancy and equipment | 10,364 | 9,867 | 31,740 | 31,437 |
Data processing and communications | 14,184 | 12,966 | 40,454 | 38,123 |
Amortization of intangible assets | 3,837 | 3,703 | 11,420 | 10,300 |
Legal and professional fees | 3,194 | 3,352 | 10,196 | 8,885 |
Business development and marketing | 3,616 | 2,383 | 9,975 | 7,071 |
Litigation accrual | 0 | (100) | 0 | (100) |
Acquisition expenses | 409 | 102 | 4,668 | 133 |
Acquisition-related contingent consideration adjustment | 0 | 0 | 400 | 0 |
Other expenses | 6,391 | 5,280 | 16,327 | 12,969 |
Total noninterest expenses | 108,185 | 100,436 | 318,416 | 287,225 |
Income before income taxes | 62,397 | 57,428 | 173,005 | 184,746 |
Income taxes | 13,706 | 12,092 | 37,454 | 38,616 |
Net income | $ 48,691 | $ 45,336 | $ 135,551 | $ 146,130 |
Basic earnings per share | $ 0.90 | $ 0.84 | $ 2.51 | $ 2.70 |
Diluted earnings per share | $ 0.90 | $ 0.83 | $ 2.49 | $ 2.68 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Pension and other post retirement obligations: | |||||
Amortization of actuarial losses included in net periodic pension cost, gross | $ 220 | $ 911 | $ 660 | $ 2,733 | |
Tax effect | (53) | (219) | (160) | (657) | |
Amortization of actuarial losses included in net periodic pension cost, net | 167 | 692 | 500 | 2,076 | |
Amortization of prior service cost included in net periodic pension cost, gross | 109 | 50 | 327 | 150 | |
Tax effect | (26) | (12) | (79) | (36) | |
Amortization of prior service cost included in net periodic pension cost, net | 83 | 38 | 248 | 114 | |
Other comprehensive income related to pension and other post-retirement obligations, net of taxes | 250 | 730 | 748 | 2,190 | |
Unrealized losses on available-for-sale securities: | |||||
Net unrealized losses arising during period, gross | (301,023) | (21,268) | (919,962) | (168,621) | |
Tax effect | 73,119 | 5,112 | 223,460 | 40,528 | |
Other comprehensive loss related to unrealized losses on available-for-sale securities, net of taxes | (227,904) | (16,156) | (696,502) | (128,093) | |
Other comprehensive loss, net of tax | (227,654) | (15,426) | (695,754) | (125,903) | |
Net income | 48,691 | 45,336 | 135,551 | 146,130 | |
Comprehensive (loss) income | (178,963) | $ 29,910 | (560,203) | $ 20,227 | |
Accumulated Other Comprehensive Loss By Component: | |||||
Unrealized loss for pension and other post-retirement obligations | (19,637) | (19,637) | $ (20,624) | ||
Tax effect | 4,915 | 4,915 | 5,154 | ||
Net unrealized loss for pension and other post-retirement obligations | (14,722) | (14,722) | (15,470) | ||
Unrealized loss on available-for-sale securities | (965,855) | (965,855) | (45,893) | ||
Tax effect | 234,196 | 234,196 | 10,736 | ||
Net unrealized loss on available-for-sale securities | (731,659) | (731,659) | (35,157) | ||
Accumulated other comprehensive loss | $ (746,381) | $ (746,381) | $ (50,627) |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive (Loss) Income | Treasury Stock | Deferred Compensation Arrangements | Total |
Balance at Dec. 31, 2020 | $ 53,755 | $ 1,025,163 | $ 960,183 | $ 62,077 | $ (6,198) | $ 9,127 | $ 2,104,107 |
Balance (in shares) at Dec. 31, 2020 | 53,593,127 | ||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Net income | 146,130 | 146,130 | |||||
Other comprehensive loss, net of tax | (125,903) | (125,903) | |||||
Dividends declared: | |||||||
Common | (68,377) | (68,377) | |||||
Common stock activity under employee stock plans | $ 317 | 8,824 | 9,141 | ||||
Common stock activity under employee stock plans (in shares) | 317,390 | ||||||
Stock-based compensation | 4,836 | 4,836 | |||||
Distribution of stock under deferred compensation arrangements | 323 | 694 | (1,017) | 0 | |||
Distribution of stock under deferred compensation arrangements (in shares) | 18,089 | ||||||
Treasury stock issued to benefit plans, net | (189) | 189 | 0 | ||||
Treasury stock issued to benefit plans, net (in shares) | (2,619) | ||||||
Balance at Sep. 30, 2021 | $ 54,072 | 1,039,146 | 1,037,936 | (63,826) | (5,693) | 8,299 | 2,069,934 |
Balance (in shares) at Sep. 30, 2021 | 53,925,987 | ||||||
Balance at Jun. 30, 2021 | $ 54,064 | 1,037,088 | 1,015,742 | (48,400) | (5,632) | 8,238 | 2,061,100 |
Balance (in shares) at Jun. 30, 2021 | 53,918,695 | ||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Net income | 45,336 | 45,336 | |||||
Other comprehensive loss, net of tax | (15,426) | (15,426) | |||||
Dividends declared: | |||||||
Common | (23,142) | (23,142) | |||||
Common stock activity under employee stock plans | $ 8 | 464 | 472 | ||||
Common stock activity under employee stock plans (in shares) | 8,122 | ||||||
Stock-based compensation | 1,594 | 1,594 | |||||
Treasury stock issued to benefit plans, net | (61) | 61 | 0 | ||||
Treasury stock issued to benefit plans, net (in shares) | (830) | ||||||
Balance at Sep. 30, 2021 | $ 54,072 | 1,039,146 | 1,037,936 | (63,826) | (5,693) | 8,299 | 2,069,934 |
Balance (in shares) at Sep. 30, 2021 | 53,925,987 | ||||||
Balance at Dec. 31, 2021 | $ 54,092 | 1,041,304 | 1,058,286 | (50,627) | (10,610) | 8,362 | 2,100,807 |
Balance (in shares) at Dec. 31, 2021 | 53,878,047 | ||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Net income | 135,551 | 135,551 | |||||
Other comprehensive loss, net of tax | (695,754) | (695,754) | |||||
Dividends declared: | |||||||
Common | (70,196) | (70,196) | |||||
Common stock activity under employee stock plans | $ 96 | 990 | 1,086 | ||||
Common stock activity under employee stock plans (in shares) | 95,586 | ||||||
Stock-based compensation | 6,047 | 6,047 | |||||
Distribution of stock under deferred compensation arrangements | 103 | 739 | (842) | 0 | |||
Distribution of stock under deferred compensation arrangements (in shares) | 14,934 | ||||||
Treasury stock purchased | (16,378) | (16,378) | |||||
Treasury stock purchased (in shares) | (250,000) | ||||||
Treasury stock issued to benefit plans, net | (177) | 177 | 0 | ||||
Treasury stock issued to benefit plans, net (in shares) | (2,551) | ||||||
Balance at Sep. 30, 2022 | $ 54,188 | 1,048,444 | 1,123,641 | (746,381) | (26,426) | 7,697 | 1,461,163 |
Balance (in shares) at Sep. 30, 2022 | 53,736,016 | ||||||
Balance at Jun. 30, 2022 | $ 54,185 | 1,046,303 | 1,098,664 | (518,727) | (26,369) | 7,640 | 1,661,696 |
Balance (in shares) at Jun. 30, 2022 | 53,734,027 | ||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Net income | 48,691 | 48,691 | |||||
Other comprehensive loss, net of tax | (227,654) | (227,654) | |||||
Dividends declared: | |||||||
Common | (23,714) | (23,714) | |||||
Common stock activity under employee stock plans | $ 3 | 284 | 287 | ||||
Common stock activity under employee stock plans (in shares) | 2,892 | ||||||
Stock-based compensation | 1,857 | 1,857 | |||||
Treasury stock issued to benefit plans, net | (57) | 57 | 0 | ||||
Treasury stock issued to benefit plans, net (in shares) | (903) | ||||||
Balance at Sep. 30, 2022 | $ 54,188 | $ 1,048,444 | $ 1,123,641 | $ (746,381) | $ (26,426) | $ 7,697 | $ 1,461,163 |
Balance (in shares) at Sep. 30, 2022 | 53,736,016 |
CONSOLIDATED STATEMENTS OF CH_2
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Cash dividends declared: | ||||
Dividends declared per common share (in dollars per share) | $ 0.44 | $ 0.43 | $ 1.30 | $ 1.27 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Operating activities: | ||
Net income | $ 135,551 | $ 146,130 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation | 10,956 | 11,898 |
Amortization of intangible assets | 11,420 | 10,300 |
Net accretion on securities, loans and borrowings | (14,519) | (17,260) |
Stock-based compensation | 6,047 | 4,836 |
Provision for credit losses | 12,005 | (11,001) |
Amortization of mortgage servicing rights | 554 | 397 |
Unrealized loss (gain) on equity securities | 24 | (14) |
Income from bank-owned life insurance policies | (1,543) | (1,500) |
Net gain on sale of assets | (570) | (408) |
Change in other assets and other liabilities | (16,889) | 9,646 |
Net cash provided by operating activities | 143,036 | 153,024 |
Investing activities: | ||
Proceeds from maturities, calls, and paydowns of available-for-sale investment securities | 210,152 | 313,913 |
Proceeds from maturities and redemptions of equity and other securities | 2,247 | 2,652 |
Purchases of available-for-sale investment securities | (1,348,400) | (1,284,544) |
Purchases of equity and other securities | (6,108) | (210) |
Net (increase) decrease in loans | (735,072) | 141,491 |
Cash received (paid) for acquisitions, net of cash acquired of $84,988 and $541, respectively | 345 | (29,329) |
Proceeds from sales of premises and equipment, net | 1,928 | 103 |
Purchases of premises and equipment, net | (10,014) | (10,299) |
Real estate tax credit investments | (247) | (586) |
Net cash used in investing activities | (1,885,169) | (866,809) |
Financing activities: | ||
Net increase in deposits | 52,858 | 1,498,847 |
Net increase in overnight borrowings | 119,800 | 0 |
Net increase in securities sold under agreement to repurchase, short-term | 28,052 | 32,755 |
Payments on other Federal Home Loan Bank borrowings | (71) | (3,746) |
Payments on subordinated debt held by unconsolidated subsidiary trusts | 0 | (77,320) |
Proceeds from the issuance of common stock | 1,086 | 9,141 |
Purchases of treasury stock | (16,555) | (189) |
Increase in deferred compensation arrangements | 177 | 189 |
Cash dividends paid | (69,681) | (67,823) |
Withholding taxes paid on share-based compensation | (1,206) | (1,213) |
Net cash provided by financing activities | 114,460 | 1,390,641 |
Change in cash and cash equivalents | (1,627,673) | 676,856 |
Cash and cash equivalents at beginning of period | 1,875,064 | 1,645,805 |
Cash and cash equivalents at end of period | 247,391 | 2,322,661 |
Supplemental disclosures of cash flow information: | ||
Cash paid for interest | 11,793 | 10,722 |
Cash paid for income taxes | 41,061 | 34,067 |
Supplemental disclosures of noncash financing and investing activities: | ||
Dividends declared and unpaid | 23,750 | 23,249 |
Transfers from loans to other real estate | 303 | 281 |
Transfers from premises and equipment, net to other assets | 5,113 | 0 |
Acquisitions: | ||
Fair value of assets acquired, excluding acquired cash and intangibles | 486,077 | 1,339 |
Fair value of liabilities assumed | $ 542,668 | $ 1,164 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Investing activities: | ||
Cash acquired related to acquisition | $ 84,988 | $ 541 |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 9 Months Ended |
Sep. 30, 2022 | |
BASIS OF PRESENTATION | |
BASIS OF PRESENTATION | NOTE A: BASIS OF PRESENTATION The interim financial data as of and for the three and nine months ended September 30, 2022 is unaudited; however, in the opinion of Community Bank System, Inc. (the “Company”), the interim data includes all adjustments, consisting only of normal recurring adjustments, necessary to present fairly the results for the interim periods in conformity with generally accepted accounting principles in the United States of America (“GAAP”) and Article 10 of Regulation S-X. The results of operations for the interim periods are not necessarily indicative of the results that may be expected for the full year or any other interim period. The Company’s unaudited interim consolidated financial statements and notes thereto should be read in conjunction with the Company’s audited annual consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 filed with the Securities and Exchange Commission (“SEC”) on March 1, 2022. |
ACQUISITIONS
ACQUISITIONS | 9 Months Ended |
Sep. 30, 2022 | |
ACQUISITIONS | |
ACQUISITIONS | NOTE B: ACQUISITIONS Current and Prior Period Acquisitions On May 13, 2022, the Company completed the acquisition of Elmira Savings Bank (“Elmira”), a New York State chartered savings bank headquartered in Elmira, New York, for $82.2 million in cash. The acquisition enhances the Company’s presence in five counties in New York’s Southern Tier and Finger Lakes regions. In connection with the acquisition, the Company acquired approximately $579.0 million of identifiable assets, including $437.0 million of loans, $11.3 million of investment securities, and $8.0 million of core deposit intangibles, as well as $522.3 million of deposits. Preliminary goodwill of $45.8 million was recognized as a result of the merger. The effects of the acquired assets and liabilities have been included in the consolidated financial statements since that date. The Company also recognized a $3.9 million acquisition-related provision for credit losses for loans acquired in the transaction. Revenues of approximately $4.8 million and $7.2 million and direct expenses of approximately $1.2 million and $1.8 million from the Elmira branch network were included in the consolidated statements of income for the three and nine months ended September 30, 2022, respectively. The Company incurred certain one-time, transaction-related costs in 2022 in connection with the Elmira acquisition. On January 1, 2022, the Company, through its subsidiary OneGroup NY, Inc. (“OneGroup”), completed acquisitions of certain assets of three insurance agencies for an aggregate amount of $2.5 million in cash. The Company recorded a $2.5 million customer list intangible asset in conjunction with the acquisitions. The effects of the acquired assets have been included in the consolidated financial statements since that date. Revenues of approximately $0.2 million and $0.8 million and direct expenses of approximately $0.1 million and $0.3 million were included in the consolidated statements of income for the three and nine months ended September 30, 2022, respectively. On August 2, 2021, the Company, through its subsidiary OneGroup, completed its acquisition of certain assets and liabilities of the Thomas Gregory Associates Insurance Brokers, Inc. (“TGA”), a specialty-lines insurance broker based in the Boston, Massachusetts area, for $11.6 million in cash plus contingent consideration with a fair value at acquisition date of $1.5 million. The Company recorded a $10.9 million customer list intangible asset and $2.2 million of goodwill in conjunction with the acquisition. The effects of the acquired assets and liabilities have been included in the consolidated financial statements since that date. Revenues of approximately $1.0 million and $3.0 million and direct expenses of approximately $0.4 million and $1.1 million from TGA were included in the consolidated income statements for the three and nine months ended September 30, 2022, respectively. The acquisition of TGA includes a contingent consideration arrangement that requires additional consideration to be paid by the Company based on the future retained revenue of TGA over a three-year period. Amounts are payable in two payments, the first of which is two years after the acquisition date, and the second is three years after the acquisition date. The range of the undiscounted amounts the Company could pay under the contingent consideration agreement is between zero and $3.4 million. The fair value of the contingent consideration recognized on the acquisition date of $1.5 million was estimated by applying the income approach, a measure that is based on significant Level 3 inputs not readily observable in the market. Key assumptions at the date of acquisition include (1) a discount rate range of 0.82% to 1.09% applied to present value the payments, and (2) probability adjusted level of retained revenue between $2.3 million and $3.8 million. The contingent consideration related to the TGA acquisition was revalued at June 30, 2022. The range of the undiscounted amounts the Company could pay under the agreement remained at between zero and $3.4 million. Key assumptions include (1) a discount rate range of 4.44% to 4.55% applied to present value the payments, and (2) probability adjusted level of retained revenue between $3.3 million and $3.7 million. Based on the results of the revaluation, the Company recorded a $0.5 million acquisition-related contingent consideration adjustment as of June 30, 2022 in the consolidated statements of income related to the TGA acquisition, for an adjusted fair value of $2.0 million at June 30, 2022. No adjustments were made to the fair value of the contingent consideration related to the TGA acquisition during the three months ended September 30, 2022. On July 1, 2021, the Company, through its subsidiary Benefit Plans Administrative Services, Inc. (“BPA”), completed its acquisition of Fringe Benefits Design of Minnesota, Inc. (“FBD”) for $15.4 million in cash plus contingent consideration with a fair value at acquisition date of $1.4 million. The Company recorded a $14.0 million customer list intangible asset and $2.1 million of goodwill in conjunction with the acquisition. The effects of the acquired assets have been included in the consolidated financial statements since that date. Revenues of approximately $0.8 million and $3.3 million and direct expenses of approximately $1.0 million and $3.2 million from FBD were included in the consolidated statements of income for the three and nine months ended September 30, 2022, respectively. The acquisition of FBD includes a contingent consideration arrangement that requires additional consideration to be paid by the Company based on the future retained revenue of FBD over a two-year period. Amounts are payable three years after the acquisition date. The range of the undiscounted amounts the Company could pay under the contingent consideration agreement is between zero and $2.7 million. The fair value of the contingent consideration recognized on the acquisition date of $1.4 million was estimated by applying the income approach; a measure that is based on significant Level 3 inputs not readily observable in the market. Key assumptions at the date of acquisition include (1) a discount rate of 1.05% applied to present value the payment, and (2) probability adjusted level of retained revenue between $5.6 million and $5.8 million. The contingent consideration related to the FBD acquisition was revalued at June 30, 2022. The range of the undiscounted amounts the Company could pay under the agreement remained at between zero and $2.7 million. Key assumptions include (1) a discount rate of 4.51% applied to present value the payment, and (2) probability adjusted level of retained revenue between $5.2 million and $5.4 million. Based on the results of the revaluation, the Company recorded a reduction to the fair value by $0.1 million as of June 30, 2022 as an acquisition-related contingent consideration adjustment in the consolidated statements of income related to the FBD acquisition, for an adjusted fair value of $1.5 million at June 30, 2022. No adjustments were made to the fair value of the contingent consideration related to the FBD acquisition during the three months ended September 30, 2022. On June 1, 2021, the Company, through its subsidiary OneGroup, completed its acquisition of certain assets and liabilities of NuVantage Insurance Corp. (“NuVantage”), an insurance agency headquartered in Melbourne, Florida. The Company paid $2.9 million in cash and recorded a $1.4 million customer list intangible asset and $1.4 million of goodwill in conjunction with the acquisition. The effects of the acquired assets and liabilities have been included in the consolidated financial statements since that date. Revenues of approximately $0.3 million and $0.9 million and direct expenses of approximately $0.3 million and $0.9 million from NuVantage were included in the consolidated statements of income for the three and nine months ended September 30, 2022. The assets and liabilities assumed in the acquisitions were recorded at their estimated fair values based on management’s best estimates using information available at the dates of the acquisitions, and are subject to adjustment based on updated information not available at the time of the acquisitions. Accrued income taxes and deferred taxes associated with the Elmira acquisition were recorded on a provisional basis and could vary from the actual recorded balance once finalized. During the first and third quarter of 2022, the carrying amount of other liabilities associated with the FBD acquisition was adjusted as a result of an adjustment to working capital based on the purchase agreement, for a total net increase to goodwill of $0.1 million. During the third quarter of 2022, the carrying amount of premises and equipment, other assets, and other liabilities related to the Elmira acquisition were adjusted upon receipt of new information as a result of adjustments to fair value and deferred income taxes. The adjustments resulted in a net decrease of $4.9 million to goodwill recognized from the Elmira acquisition at September 30, 2022. The acquisitions generally expanded the Company’s geographic presence in New York, Florida, Massachusetts, and Minnesota, and management expects that the Company will benefit from greater geographic diversity and the advantages of other synergistic business development opportunities. The following table summarizes the estimated fair value of the assets acquired and liabilities assumed: 2022 2021 (000s omitted) Elmira Other (1) Total TGA FBD NuVantage Total Consideration: Cash $ 82,179 $ 2,464 $ 84,643 $ 11,620 $ 15,350 $ 2,900 $ 29,870 Contingent consideration 0 0 0 1,500 1,400 0 2,900 Total net consideration 82,179 2,464 84,643 13,120 16,750 2,900 32,770 Recognized amounts of identifiable assets acquired and liabilities assumed: Cash and cash equivalents 84,988 0 84,988 0 541 0 541 Investment securities 11,305 0 11,305 0 0 0 0 Loans, net of allowance for credit losses on PCD loans 436,948 0 436,948 0 0 0 0 Premises and equipment, net 11,303 0 11,303 279 282 199 760 Accrued interest and fees receivable 884 0 884 0 0 0 0 Other assets 25,637 0 25,637 0 579 0 579 Core deposit intangibles 7,970 0 7,970 0 0 0 0 Other intangibles 0 2,464 2,464 10,900 14,000 1,437 26,337 Deposits (522,295) 0 (522,295) 0 0 0 0 Other liabilities (2,757) 0 (2,757) (229) (761) (174) (1,164) Other Federal Home Loan Bank borrowings (17,616) 0 (17,616) 0 0 0 0 Total identifiable assets, net 36,367 2,464 38,831 10,950 14,641 1,462 27,053 Goodwill $ 45,812 $ 0 $ 45,812 $ 2,170 $ 2,109 $ 1,438 $ 5,717 (1) Includes amounts for all OneGroup acquisitions completed in 2022. The Company has acquired loans from Elmira for which there was evidence of a more-than-insignificant deterioration in credit quality since origination (purchased credit deteriorated (“PCD”) loans). There were no investment securities acquired from Elmira for which there was evidence of a more-than-insignificant deterioration in credit quality since origination. The carrying amount of those loans is as follows at the date of acquisition: (000s omitted) PCD Loans Par value of PCD loans at acquisition $ 2,184 Allowance for credit losses at acquisition (71) Non-credit discount at acquisition (81) Fair value of PCD loans at acquisition $ 2,032 The fair value of checking, savings and money market deposit accounts acquired were assumed to approximate the carrying value as these accounts have no stated maturity and are payable on demand. Certificate of deposit accounts were valued at the present value of the certificates’ expected contractual payments discounted at market rates for similar certificates. Borrowings assumed with the Elmira acquisition included Federal Home Loan Bank of New York (“FHLB”) borrowings with a fair value of $17.6 million, with maturity dates ranging from January 2023 through March 2027 and a weighted average interest rate of 2.48%. The core deposit intangibles related to the Elmira acquisition are being amortized using an accelerated method over an estimated useful life of eight years. The other intangibles related to the NuVantage acquisition and the OneGroup asset acquisitions completed in 2022 are being amortized using an accelerated method over their estimated useful of life of eight years for NuVantage and two of the 2022 OneGroup asset acquisitions, and ten years for the third 2022 OneGroup asset acquisition. The other intangibles related to the TGA and FBD acquisitions are being amortized using an accelerated method over their estimated useful life of 13 years and 15 years, respectively. Goodwill, which is not amortized for book purposes, was assigned to the Banking segment for the Elmira acquisition, the All Other segment for the NuVantage and TGA acquisitions, and the Employee Benefit Services segment for the FBD acquisition. Goodwill arising from the Elmira and FBD acquisitions is not deductible for tax purposes. Goodwill arising from the NuVantage and TGA acquisitions is deductible for tax purposes. Direct costs related to the acquisitions were expensed as incurred. Merger and acquisition integration-related expenses were $0.4 million and $4.7 million during the three and nine months ended September 30, 2022, respectively, and were $0.1 million during the three and nine months ended September 30, 2021. These amounts have been separately stated in the consolidated statements of income. Supplemental Pro Forma Financial Information The following unaudited condensed pro forma information assumes the Elmira acquisition had been completed as of January 1, 2021 for the three and nine months ended September 30, 2022 and 2021. The table below has been prepared for comparative purposes only and is not necessarily indicative of the actual results that would have been attained had the acquisition occurred as of the beginning of the year presented, nor is it indicative of the Company’s future results. Furthermore, the unaudited pro forma information does not reflect management’s estimate of any revenue-enhancing opportunities nor anticipated cost savings that may have occurred as a result of the integration and consolidation of the acquisition. The pro forma information set forth below reflects the historical results of Elmira combined with the Company’s consolidated statements of income with adjustments related to (a) certain purchase accounting fair value adjustments and (b) amortization of core deposit intangibles. Acquisition-related expenses totaling $0.4 million and $4.7 million for the three and nine months ended September 30, 2022, respectively, related to Elmira were included in the pro forma information as if they were incurred in the first quarter of 2021. Pro Forma (Unaudited) Pro Forma (Unaudited) Three Months Ended Nine Months Ended (000’s omitted) September 30, 2022 September 30, 2021 September 30, 2022 September 30, 2021 Total revenue, net of interest expense $ 175,595 $ 163,627 $ 512,687 $ 480,668 Net income 49,016 46,838 141,138 146,529 |
ACCOUNTING POLICIES
ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2022 | |
ACCOUNTING POLICIES | |
ACCOUNTING POLICIES | NOTE C: ACCOUNTING POLICIES The accounting policies of the Company, as applied in the consolidated interim financial statements presented herein, are substantially the same as those followed on an annual basis as presented on pages 76 through 88 of the Annual Report on Form 10-K for the year ended December 31, 2021 filed with the Securities and Exchange Commission (“SEC”) on March 1, 2022 except as noted below. Contract Balances A contract asset balance occurs when an entity performs a service for a customer before the customer pays consideration (resulting in a contract receivable) or before payment is due (resulting in a contract asset). A contract liability balance is an entity’s obligation to transfer a service to a customer for which the entity has already received payment (or payment is due) from the customer. The Company’s noninterest revenue streams are largely based on transactional activity, or standard month-end revenue accruals such as asset management fees based on month-end market values. Consideration is often received immediately or shortly after the Company satisfies its performance obligation and revenue is recognized. The Company does not typically enter into long-term revenue contracts with customers, and therefore, does not experience significant contract balances. As of September 30, 2022, $32.7 million of accounts receivable, including $9.9 million of unbilled fee revenue, and $3.5 million of unearned revenue, was recorded in the consolidated statements of condition. As of December 31, 2021, $31.6 million of accounts receivable, including $9.1 million of unbilled fee revenue and $2.2 million of unearned revenue, was recorded in the consolidated statements of condition. Premises and Equipment Held for Sale Premises and equipment designated as held for sale totaling $5.1 million at September 30, 2022 are included in other assets on the consolidated statements of condition and are carried at the lower of cost or fair value. Recently Adopted Accounting Pronouncements In March 2020, the FASB issued ASU No. 2020-04, Facilitation of the Effects of Reference Rate Reform on Financial Reporting (Topic 848) In August 2021, the FASB issued ASU 2021-06, Presentation of Financial Statements (Topic 205) Financial Services-Depository and Lending (Topic 942) Financial Services-Investment Companies (Topic 946): Amendments to SEC Paragraphs Pursuant to SEC Final Rule Releases No. 33-10786 Amendments to Financial Disclosures about Acquired and Disposed Businesses No. 33-10835 Update of Statistical Disclosures for Bank and Savings and Loan Registrants Amendments to Financial Disclosures about Acquired and Disposed Businesses Update of Statistical Disclosures for Bank and Savings and Loan Registrants Accounting Pronouncements Not Yet Adopted In March 2022, the FASB issued ASU 2022-02 , Financial Instruments-Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures |
INVESTMENT SECURITIES
INVESTMENT SECURITIES | 9 Months Ended |
Sep. 30, 2022 | |
INVESTMENT SECURITIES | |
INVESTMENT SECURITIES | NOTE D: INVESTMENT SECURITIES The amortized cost and estimated fair value of investment securities as of September 30, 2022 and December 31, 2021 are as follows: September 30, 2022 December 31, 2021 Gross Gross Gross Gross Amortized Unrealized Unrealized Fair Amortized Unrealized Unrealized Fair (000’s omitted) Cost Gains Losses Value Cost Gains Losses Value Available-for-Sale Portfolio: U.S. Treasury and agency securities $ 5,103,053 $ 0 $ 827,613 $ 4,275,440 $ 4,064,624 $ 39,997 $ 106,057 $ 3,998,564 Obligations of state and political subdivisions 561,464 496 72,050 489,910 413,019 17,326 56 430,289 Government agency mortgage-backed securities 449,808 57 64,974 384,891 474,506 7,615 5,065 477,056 Corporate debt securities 8,000 0 967 7,033 8,000 39 77 7,962 Government agency collateralized mortgage obligations 14,219 1 805 13,415 19,953 410 24 20,339 Total available-for-sale investment portfolio $ 6,136,544 $ 554 $ 966,409 $ 5,170,689 $ 4,980,102 $ 65,387 $ 111,279 $ 4,934,210 Equity and other Securities: Equity securities, at fair value $ 251 $ 198 $ 10 $ 439 $ 251 $ 212 $ 0 $ 463 Federal Home Loan Bank common stock 18,438 0 0 18,438 7,188 0 0 7,188 Federal Reserve Bank common stock 33,568 0 0 33,568 33,916 0 0 33,916 Other equity securities, at adjusted cost 3,408 750 0 4,158 2,562 750 0 3,312 Total equity and other securities $ 55,665 $ 948 $ 10 $ 56,603 $ 43,917 $ 962 $ 0 $ 44,879 A summary of investment securities that have been in a continuous unrealized loss position is as follows: As of September 30, 2022 Less than 12 Months 12 Months or Longer Total Gross Gross Gross Fair Unrealized Fair Unrealized Fair Unrealized (000’s omitted) # Value Losses # Value Losses # Value Losses Available-for-Sale Portfolio: U.S. Treasury and agency securities 76 $ 2,797,064 $ 321,932 51 $ 1,478,376 $ 505,681 127 $ 4,275,440 $ 827,613 Obligations of state and political subdivisions 701 407,699 65,889 27 17,786 6,161 728 425,485 72,050 Government agency mortgage-backed securities 636 241,348 30,136 142 140,785 34,838 778 382,133 64,974 Corporate debt securities 1 2,746 254 1 4,287 713 2 7,033 967 Government agency collateralized mortgage obligations 37 11,761 634 10 1,623 171 47 13,384 805 Total available-for-sale investment portfolio 1,451 $ 3,460,618 $ 418,845 231 $ 1,642,857 $ 547,564 1,682 $ 5,103,475 $ 966,409 Equity and other Securities: Equity securities, at fair value 1 $ 91 $ 10 0 $ 0 $ 0 1 $ 91 $ 10 Total equity and other securities 1 $ 91 $ 10 0 $ 0 $ 0 1 $ 91 $ 10 As of December 31, 2021 Less than 12 Months 12 Months or Longer Total Gross Gross Gross Fair Unrealized Fair Unrealized Fair Unrealized (000’s omitted) # Value Losses # Value Losses # Value Losses Available-for-Sale Portfolio: U.S. Treasury and agency securities 47 $ 1,224,101 $ 14,873 13 $ 900,462 $ 91,184 60 $ 2,124,563 $ 106,057 Obligations of state and political subdivisions 27 23,966 56 0 0 0 27 23,966 56 Government agency mortgage-backed securities 147 139,442 2,475 52 67,273 2,590 199 206,715 5,065 Corporate debt securities 1 4,923 77 0 0 0 1 4,923 77 Government agency collateralized mortgage obligations 18 3,146 24 1 53 0 19 3,199 24 Total available-for-sale investment portfolio 240 $ 1,395,578 $ 17,505 66 $ 967,788 $ 93,774 306 $ 2,363,366 $ 111,279 The unrealized losses reported pertaining to securities issued by the U.S. government and its sponsored entities include treasuries, agencies, and mortgage-backed securities issued by Ginnie Mae, Fannie Mae, and Freddie Mac, which are currently rated AAA by Moody’s Investor Services, AA+ by Standard & Poor’s and are guaranteed by the U.S. government. The majority of the obligations of state and political subdivisions carry a credit rating of A- or better as well as carry a secondary level of credit enhancement. The Company holds two corporate debt securities in an unrealized loss position, which are currently rated A- or better, and the issuers of the securities both show a low risk of default. The Company does not intend to sell these securities, nor is it more likely than not that the Company will be required to sell these securities prior to recovery of the amortized cost. Timely principal and interest payments continue to be made on the securities. The unrealized losses in the portfolios are primarily attributable to changes in interest rates. As such, management does not believe any individual unrealized loss as of September 30, 2022 represents credit losses and no unrealized losses have been recognized in the provision for credit losses. Accordingly, there is no allowance for credit losses on the Company’s available-for-sale investment portfolio as of September 30, 2022. Accrued interest receivable on available-for-sale debt securities, included in accrued interest and fees receivable on the consolidated statements of condition, totaled $18.5 million at September 30, 2022 and is excluded from the estimate of credit losses. The amortized cost and estimated fair value of debt securities at September 30, 2022, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date, including government agency mortgage-backed securities and government agency collateralized mortgage obligations, are shown separately. Available-for-Sale Amortized Fair (000’s omitted) Cost Value Due in one year or less $ 546,740 $ 541,161 Due after one through five years 1,420,259 1,297,201 Due after five years through ten years 2,055,716 1,762,074 Due after ten years 1,649,802 1,171,947 Subtotal 5,672,517 4,772,383 Government agency mortgage-backed securities 449,808 384,891 Government agency collateralized mortgage obligations 14,219 13,415 Total $ 6,136,544 $ 5,170,689 Investment securities with a carrying value of $2.41 billion and $2.32 billion at September 30, 2022 and December 31, 2021, respectively, were pledged to collateralize certain deposits and borrowings. Securities pledged to collateralize certain deposits and borrowings included $427.2 million and $485.4 million of U.S. Treasury securities that were pledged as collateral for securities sold under agreement to repurchase at September 30, 2022 and December 31, 2021, respectively. All securities sold under agreement to repurchase as of September 30, 2022 and December 31, 2021 have an overnight and continuous maturity. |
LOANS AND ALLOWANCE FOR CREDIT
LOANS AND ALLOWANCE FOR CREDIT LOSSES | 9 Months Ended |
Sep. 30, 2022 | |
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |
LOANS AND ALLOWANCE FOR CREDIT LOSSES | NOTE E: LOANS AND ALLOWANCE FOR CREDIT LOSSES The segments of the Company’s loan portfolio are summarized as follows: September 30, December 31, (000’s omitted) 2022 2021 Business lending $ 3,494,425 $ 3,075,904 Consumer mortgage 2,975,521 2,556,114 Consumer indirect 1,461,235 1,189,749 Consumer direct 179,399 153,811 Home equity 433,027 398,061 Gross loans, including deferred origination costs 8,543,607 7,373,639 Allowance for credit losses (60,363) (49,869) Loans, net of allowance for credit losses $ 8,483,244 $ 7,323,770 The following table presents the aging of the amortized cost basis of the Company’s past due loans by segment as of September 30, 2022: Past Due 90+ Days Past 30 – 89 Due and Total (000’s omitted) Days Still Accruing Nonaccrual Past Due Current Total Loans Business lending $ 1,039 $ 0 $ 4,848 $ 5,887 $ 3,488,538 $ 3,494,425 Consumer mortgage 12,138 3,997 20,890 37,025 2,938,496 2,975,521 Consumer indirect 11,938 215 0 12,153 1,449,082 1,461,235 Consumer direct 956 38 29 1,023 178,376 179,399 Home equity 1,761 166 2,309 4,236 428,791 433,027 Total $ 27,832 $ 4,416 $ 28,076 $ 60,324 $ 8,483,283 $ 8,543,607 The following table presents the aging of the amortized cost basis of the Company’s past due loans by segment as of December 31, 2021: Past Due 90+ Days Past 30 – 89 Due and Total (000’s omitted) Days Still Accruing Nonaccrual Past Due Current Total Loans Business lending $ 5,540 $ 99 $ 24,105 $ 29,744 $ 3,046,160 $ 3,075,904 Consumer mortgage 10,297 3,328 15,027 28,652 2,527,462 2,556,114 Consumer indirect 9,611 87 0 9,698 1,180,051 1,189,749 Consumer direct 796 22 1 819 152,992 153,811 Home equity 1,778 272 2,532 4,582 393,479 398,061 Total $ 28,022 $ 3,808 $ 41,665 $ 73,495 $ 7,300,144 $ 7,373,639 No interest income on nonaccrual loans was recognized during the three and nine months ended September 30, 2022. An immaterial amount of accrued interest was written off on nonaccrual loans by reversing interest income. The Company uses several credit quality indicators to assess credit risk in an ongoing manner. The Company’s primary credit quality indicator for its business lending portfolio is an internal credit risk rating system that categorizes loans as “pass”, “special mention”, “classified”, or “doubtful”. Credit risk ratings are applied to loans individually based on a case-by-case evaluation. In general, the following are the definitions of the Company’s credit quality indicators: Pass The condition of the borrower and the performance of the loans are satisfactory or better. Special Mention The condition of the borrower has deteriorated although the loan performs as agreed. Loss may be incurred at some future date, if conditions deteriorate further. Classified The condition of the borrower has significantly deteriorated and the performance of the loan could further deteriorate and incur loss, if deficiencies are not corrected. Doubtful The condition of the borrower has deteriorated to the point that collection of the balance is improbable based on current facts and conditions and loss is likely. The following tables show the amount of business lending loans by credit quality category at September 30, 2022 and December 31, 2021: Term Loans Amortized Cost Basis by Origination Year Revolving Loans (000’s omitted) Amortized September 30, 2022 2022 2021 2020 2019 2018 Prior Cost Basis Total Business lending: Risk rating Pass $ 617,776 $ 422,638 $ 306,960 $ 325,181 $ 249,442 $ 710,320 $ 636,686 $ 3,269,003 Special mention 2,236 5,229 3,988 4,442 13,155 64,432 31,447 124,929 Classified 836 948 1,259 3,840 28,498 56,395 8,717 100,493 Doubtful 0 0 0 0 0 0 0 0 Total business lending $ 620,848 $ 428,815 $ 312,207 $ 333,463 $ 291,095 $ 831,147 $ 676,850 $ 3,494,425 Term Loans Amortized Cost Basis by Origination Year Revolving Loans (000’s omitted) Amortized December 31, 2021 2021 2020 2019 2018 2017 Prior Cost Basis Total Business lending: Risk rating Pass $ 524,302 $ 328,885 $ 320,638 $ 248,175 $ 186,074 $ 584,912 $ 524,553 $ 2,717,539 Special mention 5,969 11,013 10,111 46,318 22,524 57,134 27,444 180,513 Classified 1,870 1,767 20,315 40,235 21,904 63,685 27,511 177,287 Doubtful 0 0 0 62 0 0 503 565 Total business lending $ 532,141 $ 341,665 $ 351,064 $ 334,790 $ 230,502 $ 705,731 $ 580,011 $ 3,075,904 The business lending portfolio experienced an improvement in credit quality as a higher proportion of loans were classified as Pass at September 30, 2022 as compared to December 31, 2021. This change was the result of improvements in economic conditions, leading to improvements in the financial condition of the borrowers. All other loans are underwritten and structured using standardized criteria and characteristics, primarily payment performance, and are monitored collectively on a monthly basis. These are typically loans to individuals in the consumer categories and are delineated as either performing or nonperforming. Performing loans include loans classified as current as well as those classified as 30 - 89 days past due. Nonperforming loans include 90+ days past due and still accruing and nonaccrual loans. The following table details the balances in all other loan categories at September 30, 2022: Term Loans Amortized Cost Basis by Origination Year Revolving Loans (000’s omitted) Amortized September 30, 2022 2022 2021 2020 2019 2018 Prior Cost Basis Total Consumer mortgage: FICO AB (1) Performing $ 346,061 $ 516,066 $ 231,558 $ 182,908 $ 103,874 $ 629,948 $ 1,799 $ 2,012,214 Nonperforming 0 0 392 422 407 4,619 0 5,840 Total FICO AB 346,061 516,066 231,950 183,330 104,281 634,567 1,799 2,018,054 FICO CDE (2) Performing 125,340 190,264 120,575 85,509 57,082 336,435 23,215 938,420 Nonperforming 238 1,061 1,701 1,443 1,467 13,137 0 19,047 Total FICO CDE 125,578 191,325 122,276 86,952 58,549 349,572 23,215 957,467 Total consumer mortgage $ 471,639 $ 707,391 $ 354,226 $ 270,282 $ 162,830 $ 984,139 $ 25,014 $ 2,975,521 Consumer indirect: Performing $ 620,692 $ 453,478 $ 143,702 $ 115,304 $ 62,534 $ 65,310 $ 0 $ 1,461,020 Nonperforming 26 135 35 8 11 0 0 215 Total consumer indirect $ 620,718 $ 453,613 $ 143,737 $ 115,312 $ 62,545 $ 65,310 $ 0 $ 1,461,235 Consumer direct: Performing $ 72,531 $ 52,234 $ 19,832 $ 15,548 $ 7,045 $ 5,615 $ 6,527 $ 179,332 Nonperforming 0 0 5 1 29 12 20 67 Total consumer direct $ 72,531 $ 52,234 $ 19,837 $ 15,549 $ 7,074 $ 5,627 $ 6,547 $ 179,399 Home equity: Performing $ 55,553 $ 74,656 $ 39,458 $ 33,137 $ 17,175 $ 44,513 $ 166,060 $ 430,552 Nonperforming 0 10 122 198 153 661 1,331 2,475 Total home equity $ 55,553 $ 74,666 $ 39,580 $ 33,335 $ 17,328 $ 45,174 $ 167,391 $ 433,027 (1) FICO AB refers to higher tiered loans with FICO scores greater than or equal to 720 at origination. (2) FICO CDE refers to loans with FICO scores less than 720 at origination and potentially higher risk. The following table details the balances in all other loan categories at December 31, 2021: Term Loans Amortized Cost Basis by Origination Year Revolving Loans (000’s omitted) Amortized December 31, 2021 2021 2020 2019 2018 2017 Prior Cost Basis Total Consumer mortgage: FICO AB (1) Performing $ 514,680 $ 229,039 $ 183,469 $ 113,618 $ 116,417 $ 566,129 $ 0 $ 1,723,352 Nonperforming 0 266 0 131 435 3,236 0 4,068 Total FICO AB 514,680 229,305 183,469 113,749 116,852 569,365 0 1,727,420 FICO CDE (2) Performing 168,870 122,546 85,253 57,973 54,396 300,341 25,028 814,407 Nonperforming 0 522 972 1,465 939 10,389 0 14,287 Total FICO CDE 168,870 123,068 86,225 59,438 55,335 310,730 25,028 828,694 Total consumer mortgage $ 683,550 $ 352,373 $ 269,694 $ 173,187 $ 172,187 $ 880,095 $ 25,028 $ 2,556,114 Consumer indirect: Performing $ 590,857 $ 204,529 $ 182,458 $ 107,683 $ 39,385 $ 64,750 $ 0 $ 1,189,662 Nonperforming 0 34 0 24 17 12 0 87 Total consumer indirect $ 590,857 $ 204,563 $ 182,458 $ 107,707 $ 39,402 $ 64,762 $ 0 $ 1,189,749 Consumer direct: Performing $ 72,584 $ 28,905 $ 24,770 $ 12,340 $ 4,396 $ 4,575 $ 6,218 $ 153,788 Nonperforming 0 4 18 1 0 0 0 23 Total consumer direct $ 72,584 $ 28,909 $ 24,788 $ 12,341 $ 4,396 $ 4,575 $ 6,218 $ 153,811 Home equity: Performing $ 76,041 $ 43,106 $ 35,990 $ 18,824 $ 15,134 $ 35,740 $ 170,422 $ 395,257 Nonperforming 0 64 47 102 131 679 1,781 2,804 Total home equity $ 76,041 $ 43,170 $ 36,037 $ 18,926 $ 15,265 $ 36,419 $ 172,203 $ 398,061 (1) FICO AB refers to higher tiered loans with FICO scores greater than or equal to 720 at origination. (2) FICO CDE refers to loans with FICO scores less than 720 at origination and potentially higher risk. Commercial loans greater than $0.5 million that are on nonaccrual are individually assessed, and if necessary, a specific allocation of the allowance for credit losses is provided. A summary of individually assessed business loans as of September 30, 2022 and December 31, 2021 follows: September 30, December 31, (000’s omitted) 2022 2021 Loans with allowance allocation $ 0 $ 7,102 Loans without allowance allocation 3,232 7,417 Carrying balance 3,232 14,519 Contractual balance 4,201 16,963 Specifically allocated allowance 0 566 The average carrying balance of individually assessed loans was $3.2 million and $31.5 million for the three months ended September 30, 2022 and 2021, respectively. The average carrying balance of individually assessed loans was $12.2 million and $34.1 million for the nine months ended September 30, 2022 and 2021, respectively. No interest income was recognized on individually assessed loans for the three or nine months ended September 30, 2022 and 2021. In the course of working with borrowers, the Company may choose to restructure the contractual terms of certain loans. In this scenario, the Company attempts to work-out an alternative payment schedule with the borrower in order to optimize collectability of the loan. Any loans that are modified are reviewed by the Company to identify if a troubled debt restructuring (“TDR”) has occurred, which is when, for economic or legal reasons related to a borrower’s financial difficulties, the Company grants a concession to the borrower that it would not otherwise consider. Terms may be modified to fit the ability of the borrower to repay in line with its current financial standing and the restructuring of the loan may include the transfer of assets from the borrower to satisfy the debt, a modification of loan terms, or a combination of the two. In accordance with the clarified guidance issued by the Office of the Comptroller of the Currency (“OCC”), loans that have been discharged in Chapter 7 bankruptcy, but not reaffirmed by the borrower, are classified as TDRs, irrespective of payment history or delinquency status, even if the repayment terms for the loan have not been otherwise modified. The Company’s lien position against the underlying collateral remains unchanged. Pursuant to that guidance, the Company records a charge-off equal to any portion of the carrying value that exceeds the net realizable value of the collateral. The amount of loss incurred in the three and nine months ended September 30, 2022 and 2021 was immaterial. Information regarding TDRs as of September 30, 2022 and December 31, 2021 is as follows: September 30, 2022 December 31, 2021 (000’s omitted) Nonaccrual Accruing Total Nonaccrual Accruing Total # Amount # Amount # Amount # Amount # Amount # Amount Business lending 2 $ 161 3 $ 282 5 $ 443 10 $ 1,011 4 $ 811 14 $ 1,822 Consumer mortgage 56 2,408 44 2,041 100 4,449 61 2,694 47 2,420 108 5,114 Consumer indirect 0 0 59 628 59 628 0 0 72 829 72 829 Consumer direct 0 0 11 4 11 4 0 0 16 7 16 7 Home equity 9 116 10 217 19 333 10 235 12 232 22 467 Total 67 $ 2,685 127 $ 3,172 194 $ 5,857 81 $ 3,940 151 $ 4,299 232 $ 8,239 The following table presents information related to loans modified in a TDR during the three months and nine months ended September 30, 2022 and 2021. Of the loans noted in the table below, all consumer mortgage loans for the three months and nine months ended September 30, 2022 and 2021 were modified due to a Chapter 7 bankruptcy as described previously. The financial effects of these restructurings were immaterial. Three Months Ended Three Months Ended September 30, 2022 September 30, 2021 Number of Outstanding Number of Outstanding (000’s omitted) loans modified Balance loans modified Balance Business lending 0 $ 0 5 $ 1,925 Consumer mortgage 1 184 9 728 Consumer indirect 6 71 5 78 Consumer direct 2 3 1 2 Home equity 0 0 0 0 Total 9 $ 258 20 $ 2,733 Nine Months Ended Nine Months Ended September 30, 2022 September 30, 2021 Number of Outstanding Number of Outstanding (000’s omitted) loans modified Balance loans modified Balance Business lending 0 $ 0 5 $ 1,925 Consumer mortgage 5 459 19 1,193 Consumer indirect 12 127 17 222 Consumer direct 2 3 2 8 Home equity 1 6 0 0 Total 20 $ 595 43 $ 3,348 Allowance for Credit Losses The following presents by segment the activity in the allowance for credit losses during the three months and nine months ended September 30, 2022 and 2021: Three Months Ended September 30, 2022 Beginning Charge- Ending (000’s omitted) balance offs Recoveries Provision balance Business lending $ 23,241 $ (495) $ 755 $ 430 $ 23,931 Consumer mortgage 12,631 (113) 4 1,296 13,818 Consumer indirect 14,378 (1,706) 1,386 2,960 17,018 Consumer direct 2,822 (342) 174 361 3,015 Home equity 1,470 (32) 11 132 1,581 Unallocated 1,000 0 0 0 1,000 Allowance for credit losses – loans 55,542 (2,688) 2,330 5,179 60,363 Liabilities for off-balance-sheet credit exposures 1,223 0 0 (118) 1,105 Total allowance for credit losses $ 56,765 $ (2,688) $ 2,330 $ 5,061 $ 61,468 Three Months Ended September 30, 2021 Beginning Charge- Ending (000’s omitted) balance offs Recoveries Provision balance Business lending $ 25,302 $ (872) $ 204 $ (2,315) $ 22,319 Consumer mortgage 10,001 (127) 3 (132) 9,745 Consumer indirect 11,103 (1,365) 973 1,334 12,045 Consumer direct 2,548 (309) 163 268 2,670 Home equity 1,796 (30) 10 (56) 1,720 Unallocated 1,000 0 0 0 1,000 Allowance for credit losses – loans 51,750 (2,703) 1,353 (901) 49,499 Liabilities for off-balance-sheet credit exposures 762 0 0 (43) 719 Total allowance for credit losses $ 52,512 $ (2,703) $ 1,353 $ (944) $ 50,218 Nine Months Ended September 30, 2022 PCD Beginning Charge- Allowance at Ending (000’s omitted) balance offs Recoveries Acquisition Provision balance Business lending $ 22,995 $ (650) $ 1,249 $ 71 $ 266 $ 23,931 Consumer mortgage 10,017 (230) 21 0 4,010 13,818 Consumer indirect 11,737 (5,183) 3,732 0 6,732 17,018 Consumer direct 2,306 (859) 577 0 991 3,015 Home equity 1,814 (69) 132 0 (296) 1,581 Unallocated 1,000 0 0 0 0 1,000 Allowance for credit losses – loans 49,869 (6,991) 5,711 71 11,703 60,363 Liabilities for off-balance-sheet credit exposures 803 0 0 0 302 1,105 Total allowance for credit losses $ 50,672 $ (6,991) $ 5,711 $ 71 $ 12,005 $ 61,468 Nine Months Ended September 30, 2021 Beginning Charge- Ending (000’s omitted) balance offs Recoveries Provision balance Business lending $ 30,072 $ (925) $ 586 $ (7,414) $ 22,319 Consumer mortgage 10,672 (369) 22 (580) 9,745 Consumer indirect 13,696 (3,514) 3,402 (1,539) 12,045 Consumer direct 3,207 (822) 607 (322) 2,670 Home equity 2,222 (145) 19 (376) 1,720 Unallocated 1,000 0 0 0 1,000 Allowance for credit losses – loans 60,869 (5,775) 4,636 (10,231) 49,499 Liabilities for off-balance-sheet credit exposures 1,489 0 0 (770) 719 Total allowance for credit losses $ 62,358 $ (5,775) $ 4,636 $ (11,001) $ 50,218 A weaker economic forecast, offset, in part, by the continued improvement in non-economic qualitative adjustments resulting from low levels of delinquencies and charge-offs as well as improved risk ratings have resulted in an allowance for credit losses to total loans ratio of 0.71% at September 30, 2022, three basis points higher than the levels at both September 30, 2021 and December 31, 2021. Included in the provision for credit losses for the three and nine months ended September 30, 2022 is $3.9 million of acquisition-related provision for credit losses recognized in connection with the Elmira acquisition. Accrued interest receivable on loans, included in accrued interest and fees receivable on the consolidated statements of condition, totaled $19.8 million at September 30, 2022 and is excluded from the estimate of credit losses and amortized cost basis of loans. Under ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326) For qualitative macroeconomic adjustments, the Company uses third party forecasted economic data scenarios utilizing a base scenario and two alternative scenarios that are weighted, with forecasts available as of September 30, 2022. These forecasts were factored into the qualitative portion of the calculation of the estimated credit losses and include the continued influence of supply chain constraints and inflationary pressures as well as their commensurate impact on collateral values and economic growth. The scenarios utilized forecast stable unemployment levels, offset by deterioration in GDP growth, auto values, residential real estate, and median household income. Management developed expected loss estimates considering factors for segments as outlined below: ● Business lending – non real estate: The Company selected projected unemployment and GDP as indicators of forecasted losses related to business lending, and utilize both factors in an even weight for the calculation. The Company also considered delinquencies, the level of loan deferrals, risk rating changes, recent charge-off history and acquired loans as part of the estimation of credit losses. ● Business lending – real estate: The Company selected projected unemployment and commercial real estate values as indicators of forecasted losses related to commercial real estate loans, and utilize both factors in an even weight for the calculation. The Company also considered the factors noted in business lending – non real estate. ● Consumer mortgages and home equity: The Company selected projected unemployment and residential real estate values as indicators of forecasted losses related to mortgage lending, and utilize both factors in an even weight for the calculation. In addition, current delinquencies, the level of loan deferrals, charge-offs and acquired loans were considered. ● Consumer indirect: The Company selected projected unemployment and vehicle valuation indices as indicators of forecasted losses related to indirect lending, and utilize both factors in an even weight for the calculation. In addition, current delinquencies, the level of loan deferrals, charge-offs and acquired loans were considered. ● Consumer direct: The Company selected projected unemployment and inflation-adjusted household income as indicators of forecasted losses related to consumer direct lending, and utilize both factors in an even weight for the calculation. In addition, current delinquencies, the level of loan deferrals, charge-offs and acquired loans were considered. The following table presents the carrying amounts of loans purchased and sold during the nine months ended September 30, 2022 by portfolio segment: Business Consumer Consumer Consumer Home (000’s omitted) lending mortgage indirect direct equity Total Purchases $ 125,288 $ 271,408 $ 9,383 $ 12,511 $ 18,429 $ 437,019 Sales 0 4,541 0 0 0 4,541 All purchases of loans were from the acquisition of Elmira. All the sales of consumer mortgages during the nine months ended September 30, 2022 were sales of secondary market eligible residential mortgage loans. |
GOODWILL AND IDENTIFIABLE INTAN
GOODWILL AND IDENTIFIABLE INTANGIBLE ASSETS | 9 Months Ended |
Sep. 30, 2022 | |
GOODWILL AND IDENTIFIABLE INTANGIBLE ASSETS | |
GOODWILL AND IDENTIFIABLE INTANGIBLE ASSETS | NOTE F: GOODWILL AND IDENTIFIABLE INTANGIBLE ASSETS The gross carrying amount and accumulated amortization for each type of identifiable intangible asset are as follows: September 30, 2022 December 31, 2021 Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying (000’s omitted) Amount Amortization Amount Amount Amortization Amount Amortizing intangible assets: Core deposit intangibles $ 77,373 $ (63,823) $ 13,550 $ 69,403 $ (60,316) $ 9,087 Other intangibles 119,263 (68,573) 50,690 116,799 (60,660) 56,139 Total amortizing intangibles $ 196,636 $ (132,396) $ 64,240 $ 186,202 $ (120,976) $ 65,226 The estimated aggregate amortization expense for each of the five succeeding fiscal years ended December 31 is as follows: (000’s omitted) Oct - Dec 2022 $ 3,771 2023 13,567 2024 11,482 2025 9,783 2026 8,685 Thereafter 16,952 Total $ 64,240 Shown below are the components of the Company’s goodwill at December 31, 2021 and September 30, 2022: (000’s omitted) December 31, 2021 Activity September 30, 2022 Goodwill $ 799,109 $ 45,875 $ 844,984 |
MANDATORILY REDEEMABLE PREFERRE
MANDATORILY REDEEMABLE PREFERRED SECURITIES | 9 Months Ended |
Sep. 30, 2022 | |
MANDATORILY REDEEMABLE PREFERRED SECURITIES | |
MANDATORILY REDEEMABLE PREFERRED SECURITIES | NOTE G: MANDATORILY REDEEMABLE PREFERRED SECURITIES As of September 30, 2022, the Company does not sponsor any business trusts. The Company previously sponsored Community Capital Trust IV (“CCT IV”) until March 15, 2021 when the Company exercised its right to redeem all of the CCT IV debentures and associated preferred securities for a total of $77.3 million. The trust was formed for the purpose of issuing company-obligated mandatorily redeemable preferred securities to third-party investors and investing the proceeds from the sale of such preferred securities solely in junior subordinated debt securities of the Company. |
BENEFIT PLANS
BENEFIT PLANS | 9 Months Ended |
Sep. 30, 2022 | |
BENEFIT PLANS | |
BENEFIT PLANS | NOTE H: BENEFIT PLANS The Company provides a qualified defined benefit pension to eligible employees and retirees, other post-retirement health and life insurance benefits to certain retirees, an unfunded supplemental pension plan for certain key executives, and an unfunded stock balance plan for certain of its nonemployee directors. The Company accrues for the estimated cost of these benefits through charges to expense during the years that employees earn these benefits. The service cost component of net periodic benefit income is included in the salaries and employee benefits line of the consolidated statements of income, while the other components of net periodic benefit income are included in other expenses. The Company made a $0.1 million contribution to its defined benefit pension plan in the first quarter of 2022. The Company made a $2.8 million contribution to its defined benefit pension plan and a $0.09 million contribution to the Steuben Trust Company Pension Plan in the first quarter of 2021. The net periodic benefit cost for the three and nine months ended September 30, 2022 and 2021 is as follows: Pension Benefits Post-retirement Benefits Three Months Ended Nine Months Ended Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, (000’s omitted) 2022 2021 2022 2021 2022 2021 2022 2021 Service cost $ 1,240 $ 1,480 $ 3,720 $ 4,440 $ 0 $ 0 $ 0 $ 0 Interest cost 1,334 1,259 4,002 3,777 11 11 33 33 Expected return on plan assets (4,756) (4,696) (14,268) (14,087) 0 0 0 0 Amortization of unrecognized net loss 211 900 633 2,700 9 11 27 33 Amortization of prior service cost 154 95 462 284 (45) (45) (135) (134) Net periodic benefit $ (1,817) $ (962) $ (5,451) $ (2,886) $ (25) $ (23) $ (75) $ (68) |
EARNINGS PER SHARE
EARNINGS PER SHARE | 9 Months Ended |
Sep. 30, 2022 | |
EARNINGS PER SHARE | |
EARNINGS PER SHARE | NOTE I: EARNINGS PER SHARE The two class method is used in the calculations of basic and diluted earnings per share. Under the two class method, earnings available to common shareholders for the period are allocated between common shareholders and participating securities according to dividends declared and participation rights in undistributed earnings. The Company has determined that all of its outstanding non-vested stock awards are participating securities as of September 30, 2022. Basic earnings per share are computed based on the weighted-average of the common shares outstanding for the period. Diluted earnings per share are based on the weighted-average of the shares outstanding and the assumed exercise of stock options during the year. The dilutive effect of options is calculated using the treasury stock method of accounting. The treasury stock method determines the number of common shares that would be outstanding if all the dilutive options were exercised and the proceeds were used to repurchase common shares in the open market at the average market price for the applicable time period. There were approximately 0.4 million and 0.3 million weighted-average anti-dilutive stock options outstanding for the three months and nine months ended September 30, 2022, respectively, compared to approximately 0.2 million and 0.1 million weighted-average anti-dilutive stock options outstanding for the three months and nine months ended September 30, 2021, respectively, that were not included in the computation below. The following is a reconciliation of basic to diluted earnings per share for the three and nine months ended September 30, 2022 and 2021: Three Months Ended Nine Months Ended September 30, September 30, (000’s omitted, except per share data) 2022 2021 2022 2021 Net income $ 48,691 $ 45,336 $ 135,551 $ 146,130 Income attributable to unvested stock-based compensation awards (142) (110) (386) (340) Income available to common shareholders $ 48,549 $ 45,226 $ 135,165 $ 145,790 Weighted-average common shares outstanding – basic 53,830 54,025 53,915 53,960 Basic earnings per share $ 0.90 $ 0.84 $ 2.51 $ 2.70 Net income $ 48,691 $ 45,336 $ 135,551 $ 146,130 Income attributable to unvested stock-based compensation awards (142) (110) (386) (340) Income available to common shareholders $ 48,549 $ 45,226 $ 135,165 $ 145,790 Weighted-average common shares outstanding – basic 53,830 54,025 53,915 53,960 Assumed exercise of stock options 302 385 328 431 Weighted-average common shares outstanding – diluted 54,132 54,410 54,243 54,391 Diluted earnings per share $ 0.90 $ 0.83 $ 2.49 $ 2.68 Stock Repurchase Program At its December 2020 meeting, the Company’s Board of Directors (the “Board”) approved a stock repurchase program authorizing the repurchase of up to 2.68 million shares of the Company’s common stock, in accordance with securities and banking laws and regulations, through December 31, 2021. At its December 2021 meeting, the Board approved a new stock repurchase program for 2022, authorizing the repurchase of up to 2.70 million shares of the Company’s common stock, in accordance with securities and banking laws and regulations, through December 31, 2022. Any repurchased shares will be used for general corporate purposes, including those related to stock plan activities. The timing and extent of repurchases will depend on market conditions and other corporate considerations as determined at the Company’s discretion. The Company repurchased 250,000 shares under the authorized plan during the first nine months of 2022 and did not repurchase any shares under the authorized plan during the first nine months of 2021. Refer to Part II, Item 2: Unregistered Sales of Equity Securities and Use of Proceeds for additional information regarding repurchases of the Company’s common stock. |
COMMITMENTS, CONTINGENT LIABILI
COMMITMENTS, CONTINGENT LIABILITIES AND RESTRICTIONS | 9 Months Ended |
Sep. 30, 2022 | |
COMMITMENTS, CONTINGENT LIABILITIES AND RESTRICTIONS | |
COMMITMENTS, CONTINGENT LIABILITIES AND RESTRICTIONS | NOTE J: COMMITMENTS, CONTINGENT LIABILITIES AND RESTRICTIONS 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 consist primarily of commitments to extend credit and standby letters of credit. Commitments to extend credit are agreements to lend to customers, generally having fixed expiration dates or other termination clauses that may require payment of a fee. These commitments consist principally of unused commercial and consumer credit lines. Standby letters of credit generally are contingent upon the failure of the customer to perform according to the terms of an underlying contract with a third party. The credit risks associated with commitments to extend credit and standby letters of credit are essentially the same as that involved with extending loans to customers and are subject to the Company’s normal credit policies. Collateral may be obtained based on management’s assessment of the customer’s creditworthiness. The fair value of the standby letters of credit is immaterial for disclosure. The contract amounts of commitments and contingencies are as follows: September 30, December 31, (000’s omitted) 2022 2021 Commitments to extend credit $ 1,561,281 $ 1,443,879 Standby letters of credit 51,635 42,684 Total $ 1,612,916 $ 1,486,563 The Company and its subsidiaries are subject in the normal course of business to various pending and threatened legal proceedings in which claims for monetary damages are asserted. As of September 30, 2022, management, after consultation with legal counsel, does not anticipate that the aggregate ultimate liability arising out of litigation pending or threatened against the Company or its subsidiaries will be material to the Company’s consolidated financial position. On at least a quarterly basis, the Company assesses its liabilities and contingencies in connection with such legal proceedings. For those matters where it is probable that the Company will incur losses and the amounts of the losses can be reasonably estimated, the Company records an expense and corresponding liability in its consolidated financial statements. To the extent the pending or threatened litigation could result in exposure in excess of that liability, the amount of such excess is not currently estimable. The range of reasonably possible losses for matters where an exposure is not currently estimable or considered probable, beyond the existing recorded liabilities, is believed to be between $0 and $1 million in the aggregate. This estimated range is based on information currently available to the Company and involves elements of judgment and significant uncertainties. Although the Company does not believe that the outcome of pending or threatened litigation will be material to the Company’s consolidated financial position, it cannot rule out the possibility that such outcomes will be material to the consolidated results of operations for a particular reporting period in the future. |
FAIR VALUE
FAIR VALUE | 9 Months Ended |
Sep. 30, 2022 | |
FAIR VALUE | |
FAIR VALUE | NOTE K: FAIR VALUE Accounting standards establish a framework for measuring fair value and require certain disclosures about such fair value instruments. It defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (i.e. exit price). Inputs used to measure fair value are classified into the following hierarchy: ● Level 1 - Quoted prices in active markets for identical assets or liabilities. ● Level 2 - Quoted prices in active markets for similar assets or liabilities, or quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability. ● Level 3 - Significant valuation assumptions not readily observable in a market. A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The following tables set forth the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis. There were no transfers between any September 30, 2022 Total Fair (000’s omitted) Level 1 Level 2 Level 3 Value Available-for-sale investment securities: U.S. Treasury and agency securities $ 4,206,653 $ 68,787 $ 0 $ 4,275,440 Obligations of state and political subdivisions 0 489,910 0 489,910 Government agency mortgage-backed securities 0 384,891 0 384,891 Corporate debt securities 0 7,033 0 7,033 Government agency collateralized mortgage obligations 0 13,415 0 13,415 Total available-for-sale investment securities 4,206,653 964,036 0 5,170,689 Equity securities 439 0 0 439 Commitments to originate real estate loans for sale 0 0 (32) (32) Forward sales commitments 0 15 0 15 Interest rate swap agreements asset 0 2 0 2 Interest rate swap agreements liability 0 (2) 0 (2) Total $ 4,207,092 $ 964,051 $ (32) $ 5,171,111 December 31, 2021 Total Fair (000’s omitted) Level 1 Level 2 Level 3 Value Available-for-sale investment securities: U.S. Treasury and agency securities $ 3,900,924 $ 97,640 $ 0 $ 3,998,564 Obligations of state and political subdivisions 0 430,289 0 430,289 Government agency mortgage-backed securities 0 477,056 0 477,056 Corporate debt securities 0 7,962 0 7,962 Government agency collateralized mortgage obligations 0 20,339 0 20,339 Total available-for-sale investment securities 3,900,924 1,033,286 0 4,934,210 Equity securities 463 0 0 463 Commitments to originate real estate loans for sale 0 0 51 51 Forward sales commitments 0 32 0 32 Interest rate swap agreements asset 0 296 0 296 Interest rate swap agreements liability 0 (3) 0 (3) Total $ 3,901,387 $ 1,033,611 $ 51 $ 4,935,049 The valuation techniques used to measure fair value for the items in the table above are as follows: ● Available-for-sale investment securities and equity securities – The fair values of available-for-sale investment securities are based upon quoted prices, if available. If quoted prices are not available, fair values are measured using quoted market prices for similar securities or model-based valuation techniques. Level 1 securities include U.S. Treasury obligations and marketable equity securities that are traded by dealers or brokers in active over-the-counter markets. Level 2 securities include U.S. agency securities, mortgage-backed securities issued by government-sponsored entities, municipal securities and corporate debt securities that are valued by reference to prices for similar securities or through model-based techniques in which all significant inputs, such as reported trades, trade execution data, LIBOR swap yield curve, market prepayment speeds, credit information, market spreads, and security’s terms and conditions, are observable. See Note D for further disclosure of the fair value of investment securities. ● Forward sales commitments – The Company enters into forward sales commitments to sell certain residential real estate loans. Such commitments are considered to be derivative financial instruments and, therefore, are carried at estimated fair value in the other asset or other liability section of the consolidated statements of condition. The fair value of these forward sales commitments is primarily measured by obtaining pricing from certain government-sponsored entities and reflects the underlying price the entity would pay the Company for an immediate sale on these mortgages. As such, these instruments are classified as Level 2 in the fair value hierarchy. ● Commitments to originate real estate loans for sale – The Company enters into various commitments to originate residential real estate loans for sale. Such commitments are considered to be derivative financial instruments and, therefore, are carried at estimated fair value in the other asset or other liability section of the consolidated statements of condition. The estimated fair value of these commitments is determined using quoted secondary market prices obtained from certain government-sponsored entities. Additionally, accounting guidance requires the expected net future cash flows related to the associated servicing of the loan to be included in the fair value measurement of the derivative. The expected net future cash flows are based on a valuation model that calculates the present value of estimated net servicing income. The valuation model incorporates assumptions that market participants would use in estimating future net servicing income. Such assumptions include estimates of the cost of servicing loans, appropriate discount rate and prepayment speeds. The determination of expected net cash flows is considered a significant unobservable input contributing to the Level 3 classification of commitments to originate real estate loans for sale. ● Interest rate swaps – The interest rate swaps are reported at their fair value utilizing Level 2 inputs from third parties. The fair value of the interest rate swaps are determined using prices obtained from a third party advisor. The fair value measurement of the interest rate swap is determined by netting the discounted future fixed cash payments and the discounted expected variable cash receipts. The variable cash receipts are based on the expectation of future interest rates derived from observed market interest rate curves. The changes in Level 3 assets measured at fair value on a recurring basis are immaterial. The fair value information of assets and liabilities measured on a non-recurring basis presented below is not as of the period-end, but rather as of the date the fair value adjustment was recorded closest to the date presented. September 30, 2022 December 31, 2021 Total Fair Total Fair (000’s omitted) Level 1 Level 2 Level 3 Value Level 1 Level 2 Level 3 Value Individually assessed loans $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 1,820 $ 1,820 Other real estate owned 0 0 527 527 0 0 718 718 Mortgage servicing rights 0 0 1,844 1,844 0 0 810 810 Contingent consideration 0 0 (3,500) (3,500) 0 0 (3,100) (3,100) Total $ 0 $ 0 $ (1,129) $ (1,129) $ 0 $ 0 $ 248 $ 248 Loans are generally not recorded at fair value on a recurring basis. Periodically, the Company records nonrecurring adjustments to the carrying value of loans based on fair value measurements for partial charge-offs of the uncollectible portions of those loans. Nonrecurring adjustments also include certain impairment amounts for collateral-dependent loans calculated when establishing the allowance for credit losses. Such amounts are generally based on the fair value of the underlying collateral supporting the loan and, as a result, the carrying value of the loan less the calculated valuation amount does not necessarily represent the fair value of the loan. Real estate collateral is typically valued using independent appraisals or other indications of value based on recent comparable sales of similar properties or assumptions generally observable in the marketplace, adjusted for non-observable inputs. Thus, the resulting nonrecurring fair value measurements are generally classified as Level 3. Estimates of fair value used for other collateral supporting commercial loans generally are based on assumptions not observable in the marketplace and, therefore, such valuations classify as Level 3. Other real estate owned (“OREO”) is valued at the time the loan is foreclosed upon and the asset is transferred to OREO. The value is based primarily on third party appraisals, less costs to sell. The appraisals are sometimes further discounted based on management’s historical knowledge, changes in market conditions from the time of valuation, and/or management’s expertise and knowledge of the customer and customer’s business. Such discounts are significant, ranging from 23.2% to 73.5% at September 30, 2022 and result in a Level 3 classification of the inputs for determining fair value. OREO is reviewed and evaluated on at least a quarterly basis for additional impairment and adjusted accordingly, based on the same factors identified above. The Company recovers the carrying value of OREO through the sale of the property. The ability to affect future sales prices is subject to market conditions and factors beyond the Company’s control and may impact the estimated fair value of a property. Originated mortgage servicing rights are recorded at their fair value at the time of sale of the underlying loan, and are amortized in proportion to and over the estimated period of net servicing income. The fair value of mortgage servicing rights is based on a valuation model incorporating inputs that market participants would use in estimating future net servicing income. Such inputs include estimates of the cost of servicing loans, appropriate discount rate and prepayment speeds and are considered to be unobservable and contribute to the Level 3 classification of mortgage servicing rights. In accordance with GAAP, the Company must record impairment charges, on a nonrecurring basis, when the carrying value of a stratum exceeds its estimated fair value. Impairment is recognized through a valuation allowance. There is a valuation allowance of approximately $0.1 million at September 30, 2022 and there was no valuation allowance at December 31, 2021. The Company has recorded contingent consideration liabilities that arise from acquisition activity. The contingent consideration is recorded at fair value at the date of acquisition. The valuation of contingent consideration is calculated using an income approach method, which provides an estimation of the fair value of the liability based on future cash flows over a discrete projection period, discounted to present value using an appropriate rate of return. The assumptions used in the valuation calculation are based on significant unobservable inputs, therefore such valuations classify as Level 3. The Company determines fair values based on quoted market values, where available, estimates of present values, or other valuation techniques. Those techniques are significantly affected by the assumptions used, including, but not limited to, the discount rate and estimates of future cash flows. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, may not be realized in immediate settlement of the instrument. The significant unobservable inputs used in the determination of fair value of assets classified as Level 3 on a recurring or non-recurring basis are as follows: Significant Unobservable Input Fair Value at Range (000’s omitted, except per loan data) September 30, 2022 Valuation Technique Significant Unobservable Inputs (Weighted Average) Other real estate owned $ 527 Fair value of collateral Estimated cost of disposal/market adjustment 23.2% - 73.5% (39.9%) Commitments to originate real estate loans for sale (32) Discounted cash flow Embedded servicing value 1.0 % Mortgage servicing rights 1,844 Discounted cash flow Weighted average constant prepayment rate 3.5% - 4.1% (3.6%) Weighted average discount rate 4.6% - 4.8% (4.8%) Adequate compensation $ 7/loan Contingent consideration (3,500) Discounted cash flow Discount rate 4.4% - 4.6% (4.5%) Probability adjusted level of retained revenue $3.3 million - $5.4 million Significant Unobservable Input Fair Value at Range (000's omitted, except per loan data) December 31, 2021 Valuation Technique Significant Unobservable Inputs (Weighted Average) Individually assessed loans $ 1,820 Fair value of collateral Estimated cost of disposal/market adjustment 9.0% - 43.1% (43.1%) Other real estate owned 718 Fair value of collateral Estimated cost of disposal/market adjustment 31.8% - 42.3% (33.3%) Commitments to originate real estate loans for sale 51 Discounted cash flow Embedded servicing value 1.0 % Mortgage servicing rights 810 Discounted cash flow Weighted average constant prepayment rate 6.4% - 15.2% (14.0%) Weighted average discount rate 2.3% - 2.7% (2.6%) Adequate compensation $ 7/loan Contingent consideration (3,100) Discounted cash flow Discount rate 1.4% - 1.7% (1.5%) Probability adjusted level of retained revenue $3.0 million - $5.8 million The significant unobservable inputs used in the determination of the fair value of assets classified as Level 3 have an inherent measurement uncertainty that if changed could result in higher or lower fair value measurements of these assets as of the reporting date. The weighted average of the estimated cost of disposal/market adjustment for individually assessed loans was calculated by dividing the total of the book value of the collateral of the individually assessed loans classified as Level 3 by the total of the fair value of the collateral of the individually assessed loans classified as Level 3. The weighted average of the estimated cost of disposal/market adjustment for OREO was calculated by dividing the total of the differences between the appraisal values of the real estate and the book values of the real estate divided by the totals of the appraisal values of the real estate. The weighted average of the constant prepayment rate for mortgage servicing rights was calculated by adding the constant prepayment rates used in each loan pool weighted by the balance in each loan pool. The weighted average of the discount rate for mortgage servicing rights was calculated by adding the discount rates used in each loan pool weighted by the balance in each loan pool. The weighted average of the discount rate for the contingent consideration was calculated by adding the discount rates used for the calculation of the fair value of each payment of contingent consideration, weighted by the amount of the payment as part of the total fair value of contingent consideration. Certain financial instruments and all nonfinancial instruments are excluded from fair value disclosure requirements. Accordingly, the aggregate fair value amounts presented do not represent the underlying value of the Company. The carrying amounts and estimated fair values of the Company’s other financial instruments that are not accounted for at fair value at September 30, 2022 and December 31, 2021 are as follows: September 30, 2022 December 31, 2021 Carrying Carrying (000’s omitted) Value Fair Value Value Fair Value Financial assets: Net loans $ 8,483,244 $ 8,192,522 $ 7,323,770 $ 7,523,024 Financial liabilities: Deposits 13,486,321 13,450,034 12,911,168 12,911,197 Overnight borrowings 119,800 119,800 0 0 Securities sold under agreement to repurchase, short-term 352,772 352,772 324,720 324,720 Other Federal Home Loan Bank borrowings 19,472 19,201 1,888 1,907 Subordinated notes payable 3,256 3,256 3,277 3,277 The following is a further description of the principal valuation methods used by the Company to estimate the fair values of its financial instruments. Loans have been classified as a Level 3 valuation. Fair values for variable rate loans that reprice frequently are based on carrying values. Fair values for fixed rate loans are estimated using discounted cash flows and interest rates currently being offered for loans with similar terms to borrowers of similar credit quality. Deposits have been classified as a Level 2 valuation. The fair value of demand deposits, interest-bearing checking deposits, savings accounts, and money market deposits is the amount payable on demand at the reporting date. The fair value of time deposit obligations are based on current market rates for similar products. Borrowings have been classified as a Level 2 valuation. The fair value of short-term borrowings and securities sold under agreement to repurchase, short-term, is the amount payable on demand at the reporting date. Fair values for long-term debt are estimated using discounted cash flows and interest rates currently being offered on similar securities. The difference between the carrying values of long-term borrowings and their fair values, are not material as of the reporting dates. Other financial assets and liabilities – Cash and cash equivalents have been classified as a Level 1 valuation, while accrued interest receivable and accrued interest payable have been classified as a Level 2 valuation. The fair values of each approximate the respective carrying values because the instruments are payable on demand or have short-term maturities and present relatively low credit risk and interest rate risk. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 9 Months Ended |
Sep. 30, 2022 | |
SEGMENT INFORMATION | |
SEGMENT INFORMATION | NOTE L: SEGMENT INFORMATION Operating segments are components of an enterprise, which are evaluated regularly by the “chief operating decision maker” in deciding how to allocate resources and assess performance. The Company’s chief operating decision maker is the President and Chief Executive Officer of the Company. The Company has identified Banking, Employee Benefit Services and All Other as its reportable operating business segments. Community Bank, N.A. (the “Bank” or “CBNA”) operates the Banking segment that provides full-service banking to consumers, businesses, and governmental units in Upstate New York as well as Northeastern Pennsylvania, Vermont and Western Massachusetts. Employee Benefit Services, which includes the operating subsidiaries Benefit Plans Administrative Services, LLC, BPAS Actuarial and Pension Services, LLC, BPAS Trust Company of Puerto Rico, Fringe Benefits Design of Minnesota, Inc. (“FBD”), Northeast Retirement Services, LLC (“NRS”), Global Trust Company, Inc. (“GTC”), and Hand Benefits & Trust Company, provides employee benefit trust, collective investment fund, retirement plan administration, fund administration, transfer agency, actuarial, VEBA/HRA, and health and welfare consulting services. The All Other segment is comprised of: (a) wealth management services including trust services provided by the personal trust unit within the Bank, broker-dealer and investment advisory services provided by Community Investment Services, Inc., The Carta Group, Inc. and OneGroup Wealth Partners, Inc. as well as asset management provided by Nottingham Advisors, Inc., and (b) full-service insurance, risk management and employee benefit services provided by OneGroup NY, Inc. The accounting policies used in the disclosure of business segments are the same as those described in the summary of significant accounting policies (See Note A, Summary of Significant Accounting Policies Information about reportable segments and reconciliation of the information to the consolidated financial statements follows: Employee Consolidated (000’s omitted) Banking Benefit Services All Other Eliminations Total Three Months Ended September 30, 2022 Net interest income $ 110,311 $ 75 $ 8 $ 0 $ 110,394 Provision for credit losses 5,061 0 0 0 5,061 Noninterest revenues 19,427 28,451 19,210 (1,839) 65,249 Amortization of intangible assets 1,266 1,633 938 0 3,837 Acquisition expenses 409 0 0 0 409 Other operating expenses 73,554 17,711 14,513 (1,839) 103,939 Income before income taxes $ 49,448 $ 9,182 $ 3,767 $ 0 $ 62,397 Assets $ 15,373,021 $ 250,784 $ 102,883 $ (132,141) $ 15,594,547 Goodwill $ 735,680 $ 85,381 $ 23,923 $ 0 $ 844,984 Core deposit intangibles & Other intangibles $ 13,550 $ 35,045 $ 15,645 $ 0 $ 64,240 Three Months Ended September 30, 2021 Net interest income $ 92,539 $ 65 $ 7 $ 0 $ 92,611 Provision for credit losses (944) 0 0 0 (944) Noninterest revenues 17,696 30,473 17,885 (1,745) 64,309 Amortization of intangible assets 1,102 1,675 926 0 3,703 Acquisition expenses 102 0 0 0 102 Other operating expenses 67,980 17,212 13,184 (1,745) 96,631 Income before income taxes $ 41,995 $ 11,651 $ 3,782 $ 0 $ 57,428 Assets $ 15,102,077 $ 246,033 $ 99,721 $ (116,733) $ 15,331,098 Goodwill $ 689,868 $ 85,336 $ 23,923 $ 0 $ 799,127 Core deposit intangibles & Other intangibles $ 10,165 $ 41,695 $ 17,117 $ 0 $ 68,977 Employee Consolidated (000’s omitted) Banking Benefit Services All Other Eliminations Total Nine Months Ended September 30, 2022 Net interest income $ 308,177 $ 210 $ 20 $ 0 $ 308,407 Provision for credit losses 12,005 0 0 0 12,005 Noninterest revenues 55,634 88,093 57,065 (5,773) 195,019 Amortization of intangible assets 3,506 4,974 2,940 0 11,420 Acquisition expenses 4,665 3 0 0 4,668 Acquisition-related contingent consideration adjustment 0 (100) 500 0 400 Other operating expenses 212,616 53,026 42,059 (5,773) 301,928 Income before income taxes $ 131,019 $ 30,400 $ 11,586 $ 0 $ 173,005 Nine Months Ended September 30, 2021 Net interest income $ 278,411 $ 224 $ 35 $ 0 $ 278,670 Provision for credit losses (11,001) 0 0 0 (11,001) Noninterest revenues 50,507 85,616 51,518 (5,341) 182,300 Amortization of intangible assets 3,666 4,356 2,278 0 10,300 Acquisition expenses 133 0 0 0 133 Other operating expenses 198,145 47,063 36,925 (5,341) 276,792 Income before income taxes $ 137,975 $ 34,421 $ 12,350 $ 0 $ 184,746 |
ACCOUNTING POLICIES (Policies)
ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
ACCOUNTING POLICIES | |
Contract Balances | Contract Balances A contract asset balance occurs when an entity performs a service for a customer before the customer pays consideration (resulting in a contract receivable) or before payment is due (resulting in a contract asset). A contract liability balance is an entity’s obligation to transfer a service to a customer for which the entity has already received payment (or payment is due) from the customer. The Company’s noninterest revenue streams are largely based on transactional activity, or standard month-end revenue accruals such as asset management fees based on month-end market values. Consideration is often received immediately or shortly after the Company satisfies its performance obligation and revenue is recognized. The Company does not typically enter into long-term revenue contracts with customers, and therefore, does not experience significant contract balances. As of September 30, 2022, $32.7 million of accounts receivable, including $9.9 million of unbilled fee revenue, and $3.5 million of unearned revenue, was recorded in the consolidated statements of condition. As of December 31, 2021, $31.6 million of accounts receivable, including $9.1 million of unbilled fee revenue and $2.2 million of unearned revenue, was recorded in the consolidated statements of condition. |
Premises and Equipment Held for Sale | Premises and Equipment Held for Sale Premises and equipment designated as held for sale totaling $5.1 million at September 30, 2022 are included in other assets on the consolidated statements of condition and are carried at the lower of cost or fair value. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements In March 2020, the FASB issued ASU No. 2020-04, Facilitation of the Effects of Reference Rate Reform on Financial Reporting (Topic 848) In August 2021, the FASB issued ASU 2021-06, Presentation of Financial Statements (Topic 205) Financial Services-Depository and Lending (Topic 942) Financial Services-Investment Companies (Topic 946): Amendments to SEC Paragraphs Pursuant to SEC Final Rule Releases No. 33-10786 Amendments to Financial Disclosures about Acquired and Disposed Businesses No. 33-10835 Update of Statistical Disclosures for Bank and Savings and Loan Registrants Amendments to Financial Disclosures about Acquired and Disposed Businesses Update of Statistical Disclosures for Bank and Savings and Loan Registrants |
Accounting Pronouncements Not Yet Adopted | Accounting Pronouncements Not Yet Adopted In March 2022, the FASB issued ASU 2022-02 , Financial Instruments-Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
ACQUISITIONS | |
Summary of the estimated fair value of assets acquired and liabilities assumed | 2022 2021 (000s omitted) Elmira Other (1) Total TGA FBD NuVantage Total Consideration: Cash $ 82,179 $ 2,464 $ 84,643 $ 11,620 $ 15,350 $ 2,900 $ 29,870 Contingent consideration 0 0 0 1,500 1,400 0 2,900 Total net consideration 82,179 2,464 84,643 13,120 16,750 2,900 32,770 Recognized amounts of identifiable assets acquired and liabilities assumed: Cash and cash equivalents 84,988 0 84,988 0 541 0 541 Investment securities 11,305 0 11,305 0 0 0 0 Loans, net of allowance for credit losses on PCD loans 436,948 0 436,948 0 0 0 0 Premises and equipment, net 11,303 0 11,303 279 282 199 760 Accrued interest and fees receivable 884 0 884 0 0 0 0 Other assets 25,637 0 25,637 0 579 0 579 Core deposit intangibles 7,970 0 7,970 0 0 0 0 Other intangibles 0 2,464 2,464 10,900 14,000 1,437 26,337 Deposits (522,295) 0 (522,295) 0 0 0 0 Other liabilities (2,757) 0 (2,757) (229) (761) (174) (1,164) Other Federal Home Loan Bank borrowings (17,616) 0 (17,616) 0 0 0 0 Total identifiable assets, net 36,367 2,464 38,831 10,950 14,641 1,462 27,053 Goodwill $ 45,812 $ 0 $ 45,812 $ 2,170 $ 2,109 $ 1,438 $ 5,717 (1) Includes amounts for all OneGroup acquisitions completed in 2022. |
Schedule of loans acquired | (000s omitted) PCD Loans Par value of PCD loans at acquisition $ 2,184 Allowance for credit losses at acquisition (71) Non-credit discount at acquisition (81) Fair value of PCD loans at acquisition $ 2,032 |
Schedule of pro forma financial information | Pro Forma (Unaudited) Pro Forma (Unaudited) Three Months Ended Nine Months Ended (000’s omitted) September 30, 2022 September 30, 2021 September 30, 2022 September 30, 2021 Total revenue, net of interest expense $ 175,595 $ 163,627 $ 512,687 $ 480,668 Net income 49,016 46,838 141,138 146,529 |
INVESTMENT SECURITIES (Tables)
INVESTMENT SECURITIES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
INVESTMENT SECURITIES | |
Schedule of amortized cost and estimated fair value of investment securities | The amortized cost and estimated fair value of investment securities as of September 30, 2022 and December 31, 2021 are as follows: September 30, 2022 December 31, 2021 Gross Gross Gross Gross Amortized Unrealized Unrealized Fair Amortized Unrealized Unrealized Fair (000’s omitted) Cost Gains Losses Value Cost Gains Losses Value Available-for-Sale Portfolio: U.S. Treasury and agency securities $ 5,103,053 $ 0 $ 827,613 $ 4,275,440 $ 4,064,624 $ 39,997 $ 106,057 $ 3,998,564 Obligations of state and political subdivisions 561,464 496 72,050 489,910 413,019 17,326 56 430,289 Government agency mortgage-backed securities 449,808 57 64,974 384,891 474,506 7,615 5,065 477,056 Corporate debt securities 8,000 0 967 7,033 8,000 39 77 7,962 Government agency collateralized mortgage obligations 14,219 1 805 13,415 19,953 410 24 20,339 Total available-for-sale investment portfolio $ 6,136,544 $ 554 $ 966,409 $ 5,170,689 $ 4,980,102 $ 65,387 $ 111,279 $ 4,934,210 Equity and other Securities: Equity securities, at fair value $ 251 $ 198 $ 10 $ 439 $ 251 $ 212 $ 0 $ 463 Federal Home Loan Bank common stock 18,438 0 0 18,438 7,188 0 0 7,188 Federal Reserve Bank common stock 33,568 0 0 33,568 33,916 0 0 33,916 Other equity securities, at adjusted cost 3,408 750 0 4,158 2,562 750 0 3,312 Total equity and other securities $ 55,665 $ 948 $ 10 $ 56,603 $ 43,917 $ 962 $ 0 $ 44,879 |
Summary of investment securities that have been in a continuous unrealized loss position | As of September 30, 2022 Less than 12 Months 12 Months or Longer Total Gross Gross Gross Fair Unrealized Fair Unrealized Fair Unrealized (000’s omitted) # Value Losses # Value Losses # Value Losses Available-for-Sale Portfolio: U.S. Treasury and agency securities 76 $ 2,797,064 $ 321,932 51 $ 1,478,376 $ 505,681 127 $ 4,275,440 $ 827,613 Obligations of state and political subdivisions 701 407,699 65,889 27 17,786 6,161 728 425,485 72,050 Government agency mortgage-backed securities 636 241,348 30,136 142 140,785 34,838 778 382,133 64,974 Corporate debt securities 1 2,746 254 1 4,287 713 2 7,033 967 Government agency collateralized mortgage obligations 37 11,761 634 10 1,623 171 47 13,384 805 Total available-for-sale investment portfolio 1,451 $ 3,460,618 $ 418,845 231 $ 1,642,857 $ 547,564 1,682 $ 5,103,475 $ 966,409 Equity and other Securities: Equity securities, at fair value 1 $ 91 $ 10 0 $ 0 $ 0 1 $ 91 $ 10 Total equity and other securities 1 $ 91 $ 10 0 $ 0 $ 0 1 $ 91 $ 10 As of December 31, 2021 Less than 12 Months 12 Months or Longer Total Gross Gross Gross Fair Unrealized Fair Unrealized Fair Unrealized (000’s omitted) # Value Losses # Value Losses # Value Losses Available-for-Sale Portfolio: U.S. Treasury and agency securities 47 $ 1,224,101 $ 14,873 13 $ 900,462 $ 91,184 60 $ 2,124,563 $ 106,057 Obligations of state and political subdivisions 27 23,966 56 0 0 0 27 23,966 56 Government agency mortgage-backed securities 147 139,442 2,475 52 67,273 2,590 199 206,715 5,065 Corporate debt securities 1 4,923 77 0 0 0 1 4,923 77 Government agency collateralized mortgage obligations 18 3,146 24 1 53 0 19 3,199 24 Total available-for-sale investment portfolio 240 $ 1,395,578 $ 17,505 66 $ 967,788 $ 93,774 306 $ 2,363,366 $ 111,279 |
Schedule of amortized cost and estimated fair value of debt securities by contractual maturity | The amortized cost and estimated fair value of debt securities at September 30, 2022, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date, including government agency mortgage-backed securities and government agency collateralized mortgage obligations, are shown separately. Available-for-Sale Amortized Fair (000’s omitted) Cost Value Due in one year or less $ 546,740 $ 541,161 Due after one through five years 1,420,259 1,297,201 Due after five years through ten years 2,055,716 1,762,074 Due after ten years 1,649,802 1,171,947 Subtotal 5,672,517 4,772,383 Government agency mortgage-backed securities 449,808 384,891 Government agency collateralized mortgage obligations 14,219 13,415 Total $ 6,136,544 $ 5,170,689 |
LOANS AND ALLOWANCE FOR CREDI_2
LOANS AND ALLOWANCE FOR CREDIT LOSSES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |
Schedule of loans receivable, net | The segments of the Company’s loan portfolio are summarized as follows: September 30, December 31, (000’s omitted) 2022 2021 Business lending $ 3,494,425 $ 3,075,904 Consumer mortgage 2,975,521 2,556,114 Consumer indirect 1,461,235 1,189,749 Consumer direct 179,399 153,811 Home equity 433,027 398,061 Gross loans, including deferred origination costs 8,543,607 7,373,639 Allowance for credit losses (60,363) (49,869) Loans, net of allowance for credit losses $ 8,483,244 $ 7,323,770 |
Schedule of aged analysis of past due loans by class | The following table presents the aging of the amortized cost basis of the Company’s past due loans by segment as of September 30, 2022: Past Due 90+ Days Past 30 – 89 Due and Total (000’s omitted) Days Still Accruing Nonaccrual Past Due Current Total Loans Business lending $ 1,039 $ 0 $ 4,848 $ 5,887 $ 3,488,538 $ 3,494,425 Consumer mortgage 12,138 3,997 20,890 37,025 2,938,496 2,975,521 Consumer indirect 11,938 215 0 12,153 1,449,082 1,461,235 Consumer direct 956 38 29 1,023 178,376 179,399 Home equity 1,761 166 2,309 4,236 428,791 433,027 Total $ 27,832 $ 4,416 $ 28,076 $ 60,324 $ 8,483,283 $ 8,543,607 The following table presents the aging of the amortized cost basis of the Company’s past due loans by segment as of December 31, 2021: Past Due 90+ Days Past 30 – 89 Due and Total (000’s omitted) Days Still Accruing Nonaccrual Past Due Current Total Loans Business lending $ 5,540 $ 99 $ 24,105 $ 29,744 $ 3,046,160 $ 3,075,904 Consumer mortgage 10,297 3,328 15,027 28,652 2,527,462 2,556,114 Consumer indirect 9,611 87 0 9,698 1,180,051 1,189,749 Consumer direct 796 22 1 819 152,992 153,811 Home equity 1,778 272 2,532 4,582 393,479 398,061 Total $ 28,022 $ 3,808 $ 41,665 $ 73,495 $ 7,300,144 $ 7,373,639 |
Schedule of non-business individually assessed loans | Commercial loans greater than $0.5 million that are on nonaccrual are individually assessed, and if necessary, a specific allocation of the allowance for credit losses is provided. A summary of individually assessed business loans as of September 30, 2022 and December 31, 2021 follows: September 30, December 31, (000’s omitted) 2022 2021 Loans with allowance allocation $ 0 $ 7,102 Loans without allowance allocation 3,232 7,417 Carrying balance 3,232 14,519 Contractual balance 4,201 16,963 Specifically allocated allowance 0 566 |
Schedule of troubled debt restructurings on financing receivables | Information regarding TDRs as of September 30, 2022 and December 31, 2021 is as follows: September 30, 2022 December 31, 2021 (000’s omitted) Nonaccrual Accruing Total Nonaccrual Accruing Total # Amount # Amount # Amount # Amount # Amount # Amount Business lending 2 $ 161 3 $ 282 5 $ 443 10 $ 1,011 4 $ 811 14 $ 1,822 Consumer mortgage 56 2,408 44 2,041 100 4,449 61 2,694 47 2,420 108 5,114 Consumer indirect 0 0 59 628 59 628 0 0 72 829 72 829 Consumer direct 0 0 11 4 11 4 0 0 16 7 16 7 Home equity 9 116 10 217 19 333 10 235 12 232 22 467 Total 67 $ 2,685 127 $ 3,172 194 $ 5,857 81 $ 3,940 151 $ 4,299 232 $ 8,239 The following table presents information related to loans modified in a TDR during the three months and nine months ended September 30, 2022 and 2021. Of the loans noted in the table below, all consumer mortgage loans for the three months and nine months ended September 30, 2022 and 2021 were modified due to a Chapter 7 bankruptcy as described previously. The financial effects of these restructurings were immaterial. Three Months Ended Three Months Ended September 30, 2022 September 30, 2021 Number of Outstanding Number of Outstanding (000’s omitted) loans modified Balance loans modified Balance Business lending 0 $ 0 5 $ 1,925 Consumer mortgage 1 184 9 728 Consumer indirect 6 71 5 78 Consumer direct 2 3 1 2 Home equity 0 0 0 0 Total 9 $ 258 20 $ 2,733 Nine Months Ended Nine Months Ended September 30, 2022 September 30, 2021 Number of Outstanding Number of Outstanding (000’s omitted) loans modified Balance loans modified Balance Business lending 0 $ 0 5 $ 1,925 Consumer mortgage 5 459 19 1,193 Consumer indirect 12 127 17 222 Consumer direct 2 3 2 8 Home equity 1 6 0 0 Total 20 $ 595 43 $ 3,348 |
Schedule of allowance for loan losses by class | The following presents by segment the activity in the allowance for credit losses during the three months and nine months ended September 30, 2022 and 2021: Three Months Ended September 30, 2022 Beginning Charge- Ending (000’s omitted) balance offs Recoveries Provision balance Business lending $ 23,241 $ (495) $ 755 $ 430 $ 23,931 Consumer mortgage 12,631 (113) 4 1,296 13,818 Consumer indirect 14,378 (1,706) 1,386 2,960 17,018 Consumer direct 2,822 (342) 174 361 3,015 Home equity 1,470 (32) 11 132 1,581 Unallocated 1,000 0 0 0 1,000 Allowance for credit losses – loans 55,542 (2,688) 2,330 5,179 60,363 Liabilities for off-balance-sheet credit exposures 1,223 0 0 (118) 1,105 Total allowance for credit losses $ 56,765 $ (2,688) $ 2,330 $ 5,061 $ 61,468 Three Months Ended September 30, 2021 Beginning Charge- Ending (000’s omitted) balance offs Recoveries Provision balance Business lending $ 25,302 $ (872) $ 204 $ (2,315) $ 22,319 Consumer mortgage 10,001 (127) 3 (132) 9,745 Consumer indirect 11,103 (1,365) 973 1,334 12,045 Consumer direct 2,548 (309) 163 268 2,670 Home equity 1,796 (30) 10 (56) 1,720 Unallocated 1,000 0 0 0 1,000 Allowance for credit losses – loans 51,750 (2,703) 1,353 (901) 49,499 Liabilities for off-balance-sheet credit exposures 762 0 0 (43) 719 Total allowance for credit losses $ 52,512 $ (2,703) $ 1,353 $ (944) $ 50,218 Nine Months Ended September 30, 2022 PCD Beginning Charge- Allowance at Ending (000’s omitted) balance offs Recoveries Acquisition Provision balance Business lending $ 22,995 $ (650) $ 1,249 $ 71 $ 266 $ 23,931 Consumer mortgage 10,017 (230) 21 0 4,010 13,818 Consumer indirect 11,737 (5,183) 3,732 0 6,732 17,018 Consumer direct 2,306 (859) 577 0 991 3,015 Home equity 1,814 (69) 132 0 (296) 1,581 Unallocated 1,000 0 0 0 0 1,000 Allowance for credit losses – loans 49,869 (6,991) 5,711 71 11,703 60,363 Liabilities for off-balance-sheet credit exposures 803 0 0 0 302 1,105 Total allowance for credit losses $ 50,672 $ (6,991) $ 5,711 $ 71 $ 12,005 $ 61,468 Nine Months Ended September 30, 2021 Beginning Charge- Ending (000’s omitted) balance offs Recoveries Provision balance Business lending $ 30,072 $ (925) $ 586 $ (7,414) $ 22,319 Consumer mortgage 10,672 (369) 22 (580) 9,745 Consumer indirect 13,696 (3,514) 3,402 (1,539) 12,045 Consumer direct 3,207 (822) 607 (322) 2,670 Home equity 2,222 (145) 19 (376) 1,720 Unallocated 1,000 0 0 0 1,000 Allowance for credit losses – loans 60,869 (5,775) 4,636 (10,231) 49,499 Liabilities for off-balance-sheet credit exposures 1,489 0 0 (770) 719 Total allowance for credit losses $ 62,358 $ (5,775) $ 4,636 $ (11,001) $ 50,218 |
Schedule of financing receivables purchased and Sold | The following table presents the carrying amounts of loans purchased and sold during the nine months ended September 30, 2022 by portfolio segment: Business Consumer Consumer Consumer Home (000’s omitted) lending mortgage indirect direct equity Total Purchases $ 125,288 $ 271,408 $ 9,383 $ 12,511 $ 18,429 $ 437,019 Sales 0 4,541 0 0 0 4,541 |
Business lending | |
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |
Schedule of loans by credit quality indicator | Term Loans Amortized Cost Basis by Origination Year Revolving Loans (000’s omitted) Amortized September 30, 2022 2022 2021 2020 2019 2018 Prior Cost Basis Total Business lending: Risk rating Pass $ 617,776 $ 422,638 $ 306,960 $ 325,181 $ 249,442 $ 710,320 $ 636,686 $ 3,269,003 Special mention 2,236 5,229 3,988 4,442 13,155 64,432 31,447 124,929 Classified 836 948 1,259 3,840 28,498 56,395 8,717 100,493 Doubtful 0 0 0 0 0 0 0 0 Total business lending $ 620,848 $ 428,815 $ 312,207 $ 333,463 $ 291,095 $ 831,147 $ 676,850 $ 3,494,425 Term Loans Amortized Cost Basis by Origination Year Revolving Loans (000’s omitted) Amortized December 31, 2021 2021 2020 2019 2018 2017 Prior Cost Basis Total Business lending: Risk rating Pass $ 524,302 $ 328,885 $ 320,638 $ 248,175 $ 186,074 $ 584,912 $ 524,553 $ 2,717,539 Special mention 5,969 11,013 10,111 46,318 22,524 57,134 27,444 180,513 Classified 1,870 1,767 20,315 40,235 21,904 63,685 27,511 177,287 Doubtful 0 0 0 62 0 0 503 565 Total business lending $ 532,141 $ 341,665 $ 351,064 $ 334,790 $ 230,502 $ 705,731 $ 580,011 $ 3,075,904 |
All Other Loans | |
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |
Schedule of loans by credit quality indicator | Term Loans Amortized Cost Basis by Origination Year Revolving Loans (000’s omitted) Amortized September 30, 2022 2022 2021 2020 2019 2018 Prior Cost Basis Total Consumer mortgage: FICO AB (1) Performing $ 346,061 $ 516,066 $ 231,558 $ 182,908 $ 103,874 $ 629,948 $ 1,799 $ 2,012,214 Nonperforming 0 0 392 422 407 4,619 0 5,840 Total FICO AB 346,061 516,066 231,950 183,330 104,281 634,567 1,799 2,018,054 FICO CDE (2) Performing 125,340 190,264 120,575 85,509 57,082 336,435 23,215 938,420 Nonperforming 238 1,061 1,701 1,443 1,467 13,137 0 19,047 Total FICO CDE 125,578 191,325 122,276 86,952 58,549 349,572 23,215 957,467 Total consumer mortgage $ 471,639 $ 707,391 $ 354,226 $ 270,282 $ 162,830 $ 984,139 $ 25,014 $ 2,975,521 Consumer indirect: Performing $ 620,692 $ 453,478 $ 143,702 $ 115,304 $ 62,534 $ 65,310 $ 0 $ 1,461,020 Nonperforming 26 135 35 8 11 0 0 215 Total consumer indirect $ 620,718 $ 453,613 $ 143,737 $ 115,312 $ 62,545 $ 65,310 $ 0 $ 1,461,235 Consumer direct: Performing $ 72,531 $ 52,234 $ 19,832 $ 15,548 $ 7,045 $ 5,615 $ 6,527 $ 179,332 Nonperforming 0 0 5 1 29 12 20 67 Total consumer direct $ 72,531 $ 52,234 $ 19,837 $ 15,549 $ 7,074 $ 5,627 $ 6,547 $ 179,399 Home equity: Performing $ 55,553 $ 74,656 $ 39,458 $ 33,137 $ 17,175 $ 44,513 $ 166,060 $ 430,552 Nonperforming 0 10 122 198 153 661 1,331 2,475 Total home equity $ 55,553 $ 74,666 $ 39,580 $ 33,335 $ 17,328 $ 45,174 $ 167,391 $ 433,027 (1) FICO AB refers to higher tiered loans with FICO scores greater than or equal to 720 at origination. (2) FICO CDE refers to loans with FICO scores less than 720 at origination and potentially higher risk. The following table details the balances in all other loan categories at December 31, 2021: Term Loans Amortized Cost Basis by Origination Year Revolving Loans (000’s omitted) Amortized December 31, 2021 2021 2020 2019 2018 2017 Prior Cost Basis Total Consumer mortgage: FICO AB (1) Performing $ 514,680 $ 229,039 $ 183,469 $ 113,618 $ 116,417 $ 566,129 $ 0 $ 1,723,352 Nonperforming 0 266 0 131 435 3,236 0 4,068 Total FICO AB 514,680 229,305 183,469 113,749 116,852 569,365 0 1,727,420 FICO CDE (2) Performing 168,870 122,546 85,253 57,973 54,396 300,341 25,028 814,407 Nonperforming 0 522 972 1,465 939 10,389 0 14,287 Total FICO CDE 168,870 123,068 86,225 59,438 55,335 310,730 25,028 828,694 Total consumer mortgage $ 683,550 $ 352,373 $ 269,694 $ 173,187 $ 172,187 $ 880,095 $ 25,028 $ 2,556,114 Consumer indirect: Performing $ 590,857 $ 204,529 $ 182,458 $ 107,683 $ 39,385 $ 64,750 $ 0 $ 1,189,662 Nonperforming 0 34 0 24 17 12 0 87 Total consumer indirect $ 590,857 $ 204,563 $ 182,458 $ 107,707 $ 39,402 $ 64,762 $ 0 $ 1,189,749 Consumer direct: Performing $ 72,584 $ 28,905 $ 24,770 $ 12,340 $ 4,396 $ 4,575 $ 6,218 $ 153,788 Nonperforming 0 4 18 1 0 0 0 23 Total consumer direct $ 72,584 $ 28,909 $ 24,788 $ 12,341 $ 4,396 $ 4,575 $ 6,218 $ 153,811 Home equity: Performing $ 76,041 $ 43,106 $ 35,990 $ 18,824 $ 15,134 $ 35,740 $ 170,422 $ 395,257 Nonperforming 0 64 47 102 131 679 1,781 2,804 Total home equity $ 76,041 $ 43,170 $ 36,037 $ 18,926 $ 15,265 $ 36,419 $ 172,203 $ 398,061 (1) FICO AB refers to higher tiered loans with FICO scores greater than or equal to 720 at origination. (2) FICO CDE refers to loans with FICO scores less than 720 at origination and potentially higher risk. |
GOODWILL AND IDENTIFIABLE INT_2
GOODWILL AND IDENTIFIABLE INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
GOODWILL AND IDENTIFIABLE INTANGIBLE ASSETS | |
Schedule of gross carrying amount and accumulated amortization for each type of identifiable intangible asset | The gross carrying amount and accumulated amortization for each type of identifiable intangible asset are as follows: September 30, 2022 December 31, 2021 Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying (000’s omitted) Amount Amortization Amount Amount Amortization Amount Amortizing intangible assets: Core deposit intangibles $ 77,373 $ (63,823) $ 13,550 $ 69,403 $ (60,316) $ 9,087 Other intangibles 119,263 (68,573) 50,690 116,799 (60,660) 56,139 Total amortizing intangibles $ 196,636 $ (132,396) $ 64,240 $ 186,202 $ (120,976) $ 65,226 |
Schedule of estimated aggregate amortization expense for each of five succeeding fiscal years | The estimated aggregate amortization expense for each of the five succeeding fiscal years ended December 31 is as follows: (000’s omitted) Oct - Dec 2022 $ 3,771 2023 13,567 2024 11,482 2025 9,783 2026 8,685 Thereafter 16,952 Total $ 64,240 |
Schedule of components of goodwill | Shown below are the components of the Company’s goodwill at December 31, 2021 and September 30, 2022: (000’s omitted) December 31, 2021 Activity September 30, 2022 Goodwill $ 799,109 $ 45,875 $ 844,984 |
BENEFIT PLANS (Tables)
BENEFIT PLANS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
BENEFIT PLANS | |
Schedule of net periodic benefit cost | The net periodic benefit cost for the three and nine months ended September 30, 2022 and 2021 is as follows: Pension Benefits Post-retirement Benefits Three Months Ended Nine Months Ended Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, (000’s omitted) 2022 2021 2022 2021 2022 2021 2022 2021 Service cost $ 1,240 $ 1,480 $ 3,720 $ 4,440 $ 0 $ 0 $ 0 $ 0 Interest cost 1,334 1,259 4,002 3,777 11 11 33 33 Expected return on plan assets (4,756) (4,696) (14,268) (14,087) 0 0 0 0 Amortization of unrecognized net loss 211 900 633 2,700 9 11 27 33 Amortization of prior service cost 154 95 462 284 (45) (45) (135) (134) Net periodic benefit $ (1,817) $ (962) $ (5,451) $ (2,886) $ (25) $ (23) $ (75) $ (68) |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
EARNINGS PER SHARE | |
Schedule of reconciliation of basic to diluted earnings per share | The following is a reconciliation of basic to diluted earnings per share for the three and nine months ended September 30, 2022 and 2021: Three Months Ended Nine Months Ended September 30, September 30, (000’s omitted, except per share data) 2022 2021 2022 2021 Net income $ 48,691 $ 45,336 $ 135,551 $ 146,130 Income attributable to unvested stock-based compensation awards (142) (110) (386) (340) Income available to common shareholders $ 48,549 $ 45,226 $ 135,165 $ 145,790 Weighted-average common shares outstanding – basic 53,830 54,025 53,915 53,960 Basic earnings per share $ 0.90 $ 0.84 $ 2.51 $ 2.70 Net income $ 48,691 $ 45,336 $ 135,551 $ 146,130 Income attributable to unvested stock-based compensation awards (142) (110) (386) (340) Income available to common shareholders $ 48,549 $ 45,226 $ 135,165 $ 145,790 Weighted-average common shares outstanding – basic 53,830 54,025 53,915 53,960 Assumed exercise of stock options 302 385 328 431 Weighted-average common shares outstanding – diluted 54,132 54,410 54,243 54,391 Diluted earnings per share $ 0.90 $ 0.83 $ 2.49 $ 2.68 |
COMMITMENTS, CONTINGENT LIABI_2
COMMITMENTS, CONTINGENT LIABILITIES AND RESTRICTIONS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
COMMITMENTS, CONTINGENT LIABILITIES AND RESTRICTIONS | |
Schedule of the contract amounts of commitments and contingencies | September 30, December 31, (000’s omitted) 2022 2021 Commitments to extend credit $ 1,561,281 $ 1,443,879 Standby letters of credit 51,635 42,684 Total $ 1,612,916 $ 1,486,563 |
FAIR VALUE (Tables)
FAIR VALUE (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
FAIR VALUE | |
Schedule of fair value measured on a recurring basis | A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The following tables set forth the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis. There were no transfers between any September 30, 2022 Total Fair (000’s omitted) Level 1 Level 2 Level 3 Value Available-for-sale investment securities: U.S. Treasury and agency securities $ 4,206,653 $ 68,787 $ 0 $ 4,275,440 Obligations of state and political subdivisions 0 489,910 0 489,910 Government agency mortgage-backed securities 0 384,891 0 384,891 Corporate debt securities 0 7,033 0 7,033 Government agency collateralized mortgage obligations 0 13,415 0 13,415 Total available-for-sale investment securities 4,206,653 964,036 0 5,170,689 Equity securities 439 0 0 439 Commitments to originate real estate loans for sale 0 0 (32) (32) Forward sales commitments 0 15 0 15 Interest rate swap agreements asset 0 2 0 2 Interest rate swap agreements liability 0 (2) 0 (2) Total $ 4,207,092 $ 964,051 $ (32) $ 5,171,111 December 31, 2021 Total Fair (000’s omitted) Level 1 Level 2 Level 3 Value Available-for-sale investment securities: U.S. Treasury and agency securities $ 3,900,924 $ 97,640 $ 0 $ 3,998,564 Obligations of state and political subdivisions 0 430,289 0 430,289 Government agency mortgage-backed securities 0 477,056 0 477,056 Corporate debt securities 0 7,962 0 7,962 Government agency collateralized mortgage obligations 0 20,339 0 20,339 Total available-for-sale investment securities 3,900,924 1,033,286 0 4,934,210 Equity securities 463 0 0 463 Commitments to originate real estate loans for sale 0 0 51 51 Forward sales commitments 0 32 0 32 Interest rate swap agreements asset 0 296 0 296 Interest rate swap agreements liability 0 (3) 0 (3) Total $ 3,901,387 $ 1,033,611 $ 51 $ 4,935,049 |
Schedule of assets and liabilities measured on a non-recurring basis | The fair value information of assets and liabilities measured on a non-recurring basis presented below is not as of the period-end, but rather as of the date the fair value adjustment was recorded closest to the date presented. September 30, 2022 December 31, 2021 Total Fair Total Fair (000’s omitted) Level 1 Level 2 Level 3 Value Level 1 Level 2 Level 3 Value Individually assessed loans $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 1,820 $ 1,820 Other real estate owned 0 0 527 527 0 0 718 718 Mortgage servicing rights 0 0 1,844 1,844 0 0 810 810 Contingent consideration 0 0 (3,500) (3,500) 0 0 (3,100) (3,100) Total $ 0 $ 0 $ (1,129) $ (1,129) $ 0 $ 0 $ 248 $ 248 |
Schedule of significant unobservable inputs, fair value valuation techniques | The Company determines fair values based on quoted market values, where available, estimates of present values, or other valuation techniques. Those techniques are significantly affected by the assumptions used, including, but not limited to, the discount rate and estimates of future cash flows. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, may not be realized in immediate settlement of the instrument. The significant unobservable inputs used in the determination of fair value of assets classified as Level 3 on a recurring or non-recurring basis are as follows: Significant Unobservable Input Fair Value at Range (000’s omitted, except per loan data) September 30, 2022 Valuation Technique Significant Unobservable Inputs (Weighted Average) Other real estate owned $ 527 Fair value of collateral Estimated cost of disposal/market adjustment 23.2% - 73.5% (39.9%) Commitments to originate real estate loans for sale (32) Discounted cash flow Embedded servicing value 1.0 % Mortgage servicing rights 1,844 Discounted cash flow Weighted average constant prepayment rate 3.5% - 4.1% (3.6%) Weighted average discount rate 4.6% - 4.8% (4.8%) Adequate compensation $ 7/loan Contingent consideration (3,500) Discounted cash flow Discount rate 4.4% - 4.6% (4.5%) Probability adjusted level of retained revenue $3.3 million - $5.4 million Significant Unobservable Input Fair Value at Range (000's omitted, except per loan data) December 31, 2021 Valuation Technique Significant Unobservable Inputs (Weighted Average) Individually assessed loans $ 1,820 Fair value of collateral Estimated cost of disposal/market adjustment 9.0% - 43.1% (43.1%) Other real estate owned 718 Fair value of collateral Estimated cost of disposal/market adjustment 31.8% - 42.3% (33.3%) Commitments to originate real estate loans for sale 51 Discounted cash flow Embedded servicing value 1.0 % Mortgage servicing rights 810 Discounted cash flow Weighted average constant prepayment rate 6.4% - 15.2% (14.0%) Weighted average discount rate 2.3% - 2.7% (2.6%) Adequate compensation $ 7/loan Contingent consideration (3,100) Discounted cash flow Discount rate 1.4% - 1.7% (1.5%) Probability adjusted level of retained revenue $3.0 million - $5.8 million |
Schedule of carrying amounts and estimated fair values of other financial instruments | Certain financial instruments and all nonfinancial instruments are excluded from fair value disclosure requirements. Accordingly, the aggregate fair value amounts presented do not represent the underlying value of the Company. The carrying amounts and estimated fair values of the Company’s other financial instruments that are not accounted for at fair value at September 30, 2022 and December 31, 2021 are as follows: September 30, 2022 December 31, 2021 Carrying Carrying (000’s omitted) Value Fair Value Value Fair Value Financial assets: Net loans $ 8,483,244 $ 8,192,522 $ 7,323,770 $ 7,523,024 Financial liabilities: Deposits 13,486,321 13,450,034 12,911,168 12,911,197 Overnight borrowings 119,800 119,800 0 0 Securities sold under agreement to repurchase, short-term 352,772 352,772 324,720 324,720 Other Federal Home Loan Bank borrowings 19,472 19,201 1,888 1,907 Subordinated notes payable 3,256 3,256 3,277 3,277 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
SEGMENT INFORMATION | |
Schedule of Segment Reporting Information by Segment | Employee Consolidated (000’s omitted) Banking Benefit Services All Other Eliminations Total Three Months Ended September 30, 2022 Net interest income $ 110,311 $ 75 $ 8 $ 0 $ 110,394 Provision for credit losses 5,061 0 0 0 5,061 Noninterest revenues 19,427 28,451 19,210 (1,839) 65,249 Amortization of intangible assets 1,266 1,633 938 0 3,837 Acquisition expenses 409 0 0 0 409 Other operating expenses 73,554 17,711 14,513 (1,839) 103,939 Income before income taxes $ 49,448 $ 9,182 $ 3,767 $ 0 $ 62,397 Assets $ 15,373,021 $ 250,784 $ 102,883 $ (132,141) $ 15,594,547 Goodwill $ 735,680 $ 85,381 $ 23,923 $ 0 $ 844,984 Core deposit intangibles & Other intangibles $ 13,550 $ 35,045 $ 15,645 $ 0 $ 64,240 Three Months Ended September 30, 2021 Net interest income $ 92,539 $ 65 $ 7 $ 0 $ 92,611 Provision for credit losses (944) 0 0 0 (944) Noninterest revenues 17,696 30,473 17,885 (1,745) 64,309 Amortization of intangible assets 1,102 1,675 926 0 3,703 Acquisition expenses 102 0 0 0 102 Other operating expenses 67,980 17,212 13,184 (1,745) 96,631 Income before income taxes $ 41,995 $ 11,651 $ 3,782 $ 0 $ 57,428 Assets $ 15,102,077 $ 246,033 $ 99,721 $ (116,733) $ 15,331,098 Goodwill $ 689,868 $ 85,336 $ 23,923 $ 0 $ 799,127 Core deposit intangibles & Other intangibles $ 10,165 $ 41,695 $ 17,117 $ 0 $ 68,977 Employee Consolidated (000’s omitted) Banking Benefit Services All Other Eliminations Total Nine Months Ended September 30, 2022 Net interest income $ 308,177 $ 210 $ 20 $ 0 $ 308,407 Provision for credit losses 12,005 0 0 0 12,005 Noninterest revenues 55,634 88,093 57,065 (5,773) 195,019 Amortization of intangible assets 3,506 4,974 2,940 0 11,420 Acquisition expenses 4,665 3 0 0 4,668 Acquisition-related contingent consideration adjustment 0 (100) 500 0 400 Other operating expenses 212,616 53,026 42,059 (5,773) 301,928 Income before income taxes $ 131,019 $ 30,400 $ 11,586 $ 0 $ 173,005 Nine Months Ended September 30, 2021 Net interest income $ 278,411 $ 224 $ 35 $ 0 $ 278,670 Provision for credit losses (11,001) 0 0 0 (11,001) Noninterest revenues 50,507 85,616 51,518 (5,341) 182,300 Amortization of intangible assets 3,666 4,356 2,278 0 10,300 Acquisition expenses 133 0 0 0 133 Other operating expenses 198,145 47,063 36,925 (5,341) 276,792 Income before income taxes $ 137,975 $ 34,421 $ 12,350 $ 0 $ 184,746 |
ACQUISITIONS (Details)
ACQUISITIONS (Details) | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||
May 13, 2022 USD ($) country | Jan. 01, 2022 USD ($) | Aug. 02, 2021 USD ($) item | Jul. 01, 2021 USD ($) item | Jun. 01, 2021 USD ($) | Jan. 01, 2021 Agency | Sep. 30, 2022 USD ($) | Mar. 31, 2022 USD ($) | Sep. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) item | Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) | |
Acquisitions | |||||||||||||
Purchase price of acquisition | $ 84,643,000 | $ 32,770,000 | |||||||||||
Loans | $ 436,948,000 | 436,948,000 | 0 | ||||||||||
Investment securities | 11,305,000 | 11,305,000 | 0 | ||||||||||
Deposits | 522,295,000 | 522,295,000 | 0 | ||||||||||
Goodwill | 844,984,000 | $ 799,127,000 | 844,984,000 | $ 799,127,000 | 799,109,000 | ||||||||
Provision for credit losses | 5,061,000 | (944,000) | 12,005,000 | (11,001,000) | |||||||||
Revenue earned | 200,000 | 800,000 | |||||||||||
Direct expenses | 100,000 | 300,000 | |||||||||||
Number of insurance agencies asset acquired | Agency | 3 | ||||||||||||
Intangibles | $ 2,500,000 | ||||||||||||
Cash | (345,000) | 29,329,000 | |||||||||||
Contingent consideration | 0 | 2,900,000 | |||||||||||
Acquisition-related contingent consideration adjustment | 0 | $ 0 | 400,000 | $ 0 | |||||||||
Net increase (decrease) in goodwill | 45,875,000 | ||||||||||||
Core deposit intangibles | |||||||||||||
Acquisitions | |||||||||||||
Deposits | (7,970,000) | (7,970,000) | 0 | ||||||||||
Elmira Savings Bank ("Elmira") | |||||||||||||
Acquisitions | |||||||||||||
Purchase price of acquisition | $ 82,200,000 | 82,179,000 | |||||||||||
Number of country | country | 5 | ||||||||||||
Assets acquired | $ 579,000,000 | ||||||||||||
Loans | 437,000,000 | 436,948,000 | 436,948,000 | ||||||||||
Investment securities | 11,300,000 | 11,305,000 | 11,305,000 | ||||||||||
Deposits | 522,300,000 | 522,295,000 | 522,295,000 | ||||||||||
Goodwill | 45,800,000 | 45,812,000 | 45,812,000 | ||||||||||
Provision for credit losses | 3,900,000 | 3,900,000 | 3,900,000 | ||||||||||
Revenue earned | 4,800,000 | 7,200,000 | |||||||||||
Direct expenses | 1,200,000 | 1,800,000 | |||||||||||
Contingent consideration | 0 | ||||||||||||
Net increase (decrease) in goodwill | (4,900,000) | ||||||||||||
Elmira Savings Bank ("Elmira") | Core deposit intangibles | |||||||||||||
Acquisitions | |||||||||||||
Deposits | $ 8,000,000 | (7,970,000) | (7,970,000) | ||||||||||
Thomas Gregory Associates Insurance Brokers, Inc. ("TGA") | |||||||||||||
Acquisitions | |||||||||||||
Purchase price of acquisition | 13,120,000 | ||||||||||||
Loans | 0 | ||||||||||||
Investment securities | 0 | ||||||||||||
Deposits | 0 | ||||||||||||
Goodwill | $ 2,200,000 | 2,170,000 | |||||||||||
Revenue earned | 1,000,000 | 3,000,000 | |||||||||||
Direct expenses | 400,000 | 1,100,000 | |||||||||||
Cash | 11,600,000 | ||||||||||||
Contingent consideration | $ 1,500,000 | 1,500,000 | |||||||||||
Period considered for additional consideration based on future retained revenue | 3 years | ||||||||||||
Acquisition-related contingent consideration adjustment | $ 500,000 | ||||||||||||
Fair value contingent consideration adjustment | 0 | 2,000,000 | |||||||||||
Thomas Gregory Associates Insurance Brokers, Inc. ("TGA") | Minimum | |||||||||||||
Acquisitions | |||||||||||||
Contingent consideration | $ 0 | $ 0 | |||||||||||
Contingent consideration, measurement input | item | 0.82 | 4.44 | |||||||||||
Thomas Gregory Associates Insurance Brokers, Inc. ("TGA") | Maximum | |||||||||||||
Acquisitions | |||||||||||||
Contingent consideration | $ 3,400,000 | $ 3,400,000 | |||||||||||
Contingent consideration, measurement input | item | 1.09 | 4.55 | |||||||||||
Thomas Gregory Associates Insurance Brokers, Inc. ("TGA") | Probability adjusted level of retained revenue | Minimum | |||||||||||||
Acquisitions | |||||||||||||
Contingent consideration, measurement input 2 | $ 2,300,000 | $ 3,300,000 | |||||||||||
Thomas Gregory Associates Insurance Brokers, Inc. ("TGA") | Probability adjusted level of retained revenue | Maximum | |||||||||||||
Acquisitions | |||||||||||||
Contingent consideration, measurement input 2 | $ 3,800,000 | $ 3,700,000 | |||||||||||
Thomas Gregory Associates Insurance Brokers, Inc. ("TGA") | Within two years from acquisition | |||||||||||||
Acquisitions | |||||||||||||
Consideration payable term | 2 years | ||||||||||||
Thomas Gregory Associates Insurance Brokers, Inc. ("TGA") | Within three years from acquisition | |||||||||||||
Acquisitions | |||||||||||||
Consideration payable term | 3 years | ||||||||||||
Thomas Gregory Associates Insurance Brokers, Inc. ("TGA") | Customer Lists [Member] | |||||||||||||
Acquisitions | |||||||||||||
Intangibles | $ 10,900,000 | ||||||||||||
Thomas Gregory Associates Insurance Brokers, Inc. ("TGA") | Core deposit intangibles | |||||||||||||
Acquisitions | |||||||||||||
Deposits | 0 | ||||||||||||
Fringe Benefits Design of Minnesota, Inc ("FBD") | |||||||||||||
Acquisitions | |||||||||||||
Purchase price of acquisition | 16,750,000 | ||||||||||||
Loans | 0 | ||||||||||||
Investment securities | 0 | ||||||||||||
Deposits | 0 | ||||||||||||
Goodwill | $ 2,100,000 | 2,109,000 | |||||||||||
Revenue earned | 800,000 | 3,300,000 | |||||||||||
Direct expenses | 1,000,000 | 3,200,000 | |||||||||||
Cash | 15,400,000 | ||||||||||||
Contingent consideration | $ 1,400,000 | 1,400,000 | |||||||||||
Period considered for additional consideration based on future retained revenue | 2 years | ||||||||||||
Consideration payable term | 3 years | ||||||||||||
Contingent consideration, measurement input | item | 1.05 | 4.51 | |||||||||||
Acquisition-related contingent consideration adjustment | $ 100,000 | ||||||||||||
Fair value contingent consideration adjustment | 0 | 1,500,000 | |||||||||||
Net increase (decrease) in goodwill | 100,000 | $ 100,000 | |||||||||||
Fringe Benefits Design of Minnesota, Inc ("FBD") | Minimum | |||||||||||||
Acquisitions | |||||||||||||
Contingent consideration | $ 0 | 0 | |||||||||||
Fringe Benefits Design of Minnesota, Inc ("FBD") | Maximum | |||||||||||||
Acquisitions | |||||||||||||
Contingent consideration | 2,700,000 | 2,700,000 | |||||||||||
Fringe Benefits Design of Minnesota, Inc ("FBD") | Probability adjusted level of retained revenue | Minimum | |||||||||||||
Acquisitions | |||||||||||||
Contingent consideration, measurement input 2 | 5,600,000 | ||||||||||||
Fringe Benefits Design of Minnesota, Inc ("FBD") | Probability adjusted level of retained revenue | Maximum | |||||||||||||
Acquisitions | |||||||||||||
Contingent consideration, measurement input 2 | 5,800,000 | ||||||||||||
Fringe Benefits Design of Minnesota, Inc ("FBD") | Customer Lists [Member] | |||||||||||||
Acquisitions | |||||||||||||
Intangibles | $ 14,000,000 | ||||||||||||
Fringe Benefits Design of Minnesota, Inc ("FBD") | Core deposit intangibles | |||||||||||||
Acquisitions | |||||||||||||
Deposits | $ 0 | ||||||||||||
NuVantage Insurance, Inc. [Member] | |||||||||||||
Acquisitions | |||||||||||||
Goodwill | $ 1,400,000 | ||||||||||||
Revenue earned | 300,000 | 900,000 | |||||||||||
Direct expenses | $ 300,000 | $ 900,000 | |||||||||||
Intangibles | 1,400,000 | ||||||||||||
Purchase price in cash | $ 2,900,000 | ||||||||||||
NuVantage Insurance, Inc. [Member] | Probability adjusted level of retained revenue | Minimum | |||||||||||||
Acquisitions | |||||||||||||
Contingent consideration, measurement input 2 | 5,200,000 | ||||||||||||
NuVantage Insurance, Inc. [Member] | Probability adjusted level of retained revenue | Maximum | |||||||||||||
Acquisitions | |||||||||||||
Contingent consideration, measurement input 2 | $ 5,400,000 | ||||||||||||
One Group NY, Inc. | |||||||||||||
Acquisitions | |||||||||||||
Purchase price of acquisition | $ 2,500,000 |
ACQUISITIONS - Estimated fair v
ACQUISITIONS - Estimated fair value of assets acquired and liabilities assumed (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |||||
May 13, 2022 | Aug. 02, 2021 | Jul. 01, 2021 | Sep. 30, 2022 | Dec. 31, 2021 | Jan. 01, 2022 | Sep. 30, 2021 | |
Consideration : | |||||||
Cash | $ 84,643 | $ 29,870 | |||||
Contingent consideration | 0 | 2,900 | |||||
Total net consideration | 84,643 | 32,770 | |||||
Recognized amounts of identifiable assets acquired and liabilities assumed: | |||||||
Cash and cash equivalents | 84,988 | 541 | |||||
Investment securities | 11,305 | 0 | |||||
Loans, net of allowance for credit losses on PCD loans | 436,948 | 0 | |||||
Premises and equipment, net | 11,303 | 760 | |||||
Accrued interest and fees receivable | 884 | 0 | |||||
Other assets | 25,637 | 579 | |||||
Other intangibles | $ 2,500 | ||||||
Deposits | (522,295) | 0 | |||||
Other liabilities | (2,757) | (1,164) | |||||
Other Federal Home Loan Bank borrowings | (17,616) | 0 | |||||
Total identifiable assets, net | 38,831 | 27,053 | |||||
Goodwill | 844,984 | 799,109 | $ 799,127 | ||||
Core deposit intangibles | |||||||
Recognized amounts of identifiable assets acquired and liabilities assumed: | |||||||
Deposits | 7,970 | 0 | |||||
Other intangibles | |||||||
Recognized amounts of identifiable assets acquired and liabilities assumed: | |||||||
Other intangibles | 2,464 | 26,337 | |||||
Elmira Savings Bank ("Elmira") | |||||||
Consideration : | |||||||
Cash | 82,179 | ||||||
Contingent consideration | 0 | ||||||
Total net consideration | $ 82,200 | 82,179 | |||||
Recognized amounts of identifiable assets acquired and liabilities assumed: | |||||||
Cash and cash equivalents | 84,988 | ||||||
Investment securities | 11,300 | 11,305 | |||||
Loans, net of allowance for credit losses on PCD loans | 437,000 | 436,948 | |||||
Premises and equipment, net | 11,303 | ||||||
Accrued interest and fees receivable | 884 | ||||||
Other assets | 25,637 | ||||||
Deposits | (522,300) | (522,295) | |||||
Other liabilities | (2,757) | ||||||
Other Federal Home Loan Bank borrowings | (17,616) | ||||||
Total identifiable assets, net | 36,367 | ||||||
Goodwill | 45,800 | 45,812 | |||||
Elmira Savings Bank ("Elmira") | Core deposit intangibles | |||||||
Recognized amounts of identifiable assets acquired and liabilities assumed: | |||||||
Deposits | $ (8,000) | 7,970 | |||||
Elmira Savings Bank ("Elmira") | Other intangibles | |||||||
Recognized amounts of identifiable assets acquired and liabilities assumed: | |||||||
Other intangibles | 0 | ||||||
Other | |||||||
Consideration : | |||||||
Cash | 2,464 | ||||||
Contingent consideration | 0 | ||||||
Total net consideration | 2,464 | ||||||
Recognized amounts of identifiable assets acquired and liabilities assumed: | |||||||
Cash and cash equivalents | 0 | ||||||
Investment securities | 0 | ||||||
Loans, net of allowance for credit losses on PCD loans | 0 | ||||||
Premises and equipment, net | 0 | ||||||
Accrued interest and fees receivable | 0 | ||||||
Other assets | 0 | ||||||
Deposits | 0 | ||||||
Other liabilities | 0 | ||||||
Other Federal Home Loan Bank borrowings | 0 | ||||||
Total identifiable assets, net | 2,464 | ||||||
Goodwill | 0 | ||||||
Other | Core deposit intangibles | |||||||
Recognized amounts of identifiable assets acquired and liabilities assumed: | |||||||
Deposits | 0 | ||||||
Other | Other intangibles | |||||||
Recognized amounts of identifiable assets acquired and liabilities assumed: | |||||||
Other intangibles | 2,464 | ||||||
Thomas Gregory Associates Insurance Brokers, Inc. ("TGA") | |||||||
Consideration : | |||||||
Cash | 11,620 | ||||||
Contingent consideration | $ 1,500 | 1,500 | |||||
Total net consideration | 13,120 | ||||||
Recognized amounts of identifiable assets acquired and liabilities assumed: | |||||||
Cash and cash equivalents | 0 | ||||||
Investment securities | 0 | ||||||
Loans, net of allowance for credit losses on PCD loans | 0 | ||||||
Premises and equipment, net | 279 | ||||||
Accrued interest and fees receivable | 0 | ||||||
Other assets | 0 | ||||||
Deposits | 0 | ||||||
Other liabilities | (229) | ||||||
Other Federal Home Loan Bank borrowings | 0 | ||||||
Total identifiable assets, net | 10,950 | ||||||
Goodwill | $ 2,200 | 2,170 | |||||
Thomas Gregory Associates Insurance Brokers, Inc. ("TGA") | Core deposit intangibles | |||||||
Recognized amounts of identifiable assets acquired and liabilities assumed: | |||||||
Deposits | 0 | ||||||
Thomas Gregory Associates Insurance Brokers, Inc. ("TGA") | Other intangibles | |||||||
Recognized amounts of identifiable assets acquired and liabilities assumed: | |||||||
Other intangibles | 10,900 | ||||||
Fringe Benefits Design of Minnesota, Inc ("FBD") | |||||||
Consideration : | |||||||
Cash | 15,350 | ||||||
Contingent consideration | $ 1,400 | 1,400 | |||||
Total net consideration | 16,750 | ||||||
Recognized amounts of identifiable assets acquired and liabilities assumed: | |||||||
Cash and cash equivalents | 541 | ||||||
Investment securities | 0 | ||||||
Loans, net of allowance for credit losses on PCD loans | 0 | ||||||
Premises and equipment, net | 282 | ||||||
Accrued interest and fees receivable | 0 | ||||||
Other assets | 579 | ||||||
Deposits | 0 | ||||||
Other liabilities | (761) | ||||||
Other Federal Home Loan Bank borrowings | 0 | ||||||
Total identifiable assets, net | 14,641 | ||||||
Goodwill | $ 2,100 | 2,109 | |||||
Fringe Benefits Design of Minnesota, Inc ("FBD") | Core deposit intangibles | |||||||
Recognized amounts of identifiable assets acquired and liabilities assumed: | |||||||
Deposits | 0 | ||||||
Fringe Benefits Design of Minnesota, Inc ("FBD") | Other intangibles | |||||||
Recognized amounts of identifiable assets acquired and liabilities assumed: | |||||||
Other intangibles | 14,000 | ||||||
NuVantage | |||||||
Consideration : | |||||||
Cash | 2,900 | ||||||
Contingent consideration | 0 | ||||||
Total net consideration | 2,900 | ||||||
Recognized amounts of identifiable assets acquired and liabilities assumed: | |||||||
Cash and cash equivalents | 0 | ||||||
Investment securities | 0 | ||||||
Loans, net of allowance for credit losses on PCD loans | 0 | ||||||
Premises and equipment, net | 199 | ||||||
Accrued interest and fees receivable | 0 | ||||||
Other assets | 0 | ||||||
Deposits | 0 | ||||||
Other liabilities | (174) | ||||||
Other Federal Home Loan Bank borrowings | 0 | ||||||
Total identifiable assets, net | 1,462 | ||||||
Goodwill | 1,438 | ||||||
NuVantage | Core deposit intangibles | |||||||
Recognized amounts of identifiable assets acquired and liabilities assumed: | |||||||
Deposits | 0 | ||||||
NuVantage | Other intangibles | |||||||
Recognized amounts of identifiable assets acquired and liabilities assumed: | |||||||
Other intangibles | 1,437 | ||||||
One Group Acquisitions | |||||||
Recognized amounts of identifiable assets acquired and liabilities assumed: | |||||||
Goodwill | $ 45,812 | $ 5,717 |
ACQUISITIONS - Loans acquired (
ACQUISITIONS - Loans acquired (Details) - PCD Loans $ in Thousands | Sep. 30, 2022 USD ($) |
Certain loans acquired during the period: | |
Par value of PCD loans at acquisition | $ 2,184 |
Allowance for credit losses at acquisition | (71) |
Non-credit premium at acquisition | (81) |
Fair value of PCD loans at acquisition | $ 2,032 |
ACQUISITIONS - Intangible asset
ACQUISITIONS - Intangible asset, goodwill and acquisition related expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Identifiable Intangible Assets | ||||
Merger and acquisition integration related (recoveries) expenses | $ 409 | $ 102 | $ 4,668 | $ 133 |
Elmira Savings Bank ("Elmira") | ||||
Identifiable Intangible Assets | ||||
Federal Home Loan Bank of New York borrowings | $ 17,600 | $ 17,600 | ||
Weighted-average rate | 2.48% | 2.48% | ||
Elmira Savings Bank ("Elmira") | Core deposit intangibles | ||||
Identifiable Intangible Assets | ||||
Intangible asset useful life (amortization period) | 8 years | |||
NuVantage Insurance Corp. ("NuVantage") | Other intangibles | Second acquisition of 2022 OneGroup | ||||
Identifiable Intangible Assets | ||||
Intangible asset useful life (amortization period) | 8 years | |||
NuVantage Insurance Corp. ("NuVantage") | Other intangibles | Third acquisition of 2022 OneGroup | ||||
Identifiable Intangible Assets | ||||
Intangible asset useful life (amortization period) | 10 years | |||
Thomas Gregory Associates Insurance Brokers, Inc. ("TGA") | Other intangibles | ||||
Identifiable Intangible Assets | ||||
Intangible asset useful life (amortization period) | 13 years | |||
Fringe Benefits Design of Minnesota, Inc ("FBD") | Other intangibles | ||||
Identifiable Intangible Assets | ||||
Intangible asset useful life (amortization period) | 15 years |
ACQUISITIONS - Supplemental pro
ACQUISITIONS - Supplemental pro forma financial information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Pro Forma | ||||
Total revenue, net of interest expense | $ 175,595 | $ 163,627 | $ 512,687 | $ 480,668 |
Net income | 49,016 | $ 46,838 | 141,138 | $ 146,529 |
Elmira Savings Bank ("Elmira") | ||||
Pro Forma | ||||
Acquisitions-related expenses | $ 400 | $ 4,700 |
ACCOUNTING POLICIES (Details)
ACCOUNTING POLICIES (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Contract Balances | ||
Accounts receivable | $ 32.7 | $ 31.6 |
Unbilled fee revenue | 9.9 | 9.1 |
Unearned revenue | 3.5 | $ 2.2 |
Premises and Equipment Held for Sale | ||
Premises and equipment, held for sale including other assets | $ 5.1 |
INVESTMENT SECURITIES - Availab
INVESTMENT SECURITIES - Available-for-Sale Portfolio (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 | Dec. 31, 2021 | |
Available-for-Sale Portfolio | ||
Amortized cost | $ 6,136,544 | $ 4,980,102 |
Gross unrealized gains | 554 | 65,387 |
Gross unrealized losses | 966,409 | 111,279 |
Available-for-sale investment securities | 5,170,689 | 4,934,210 |
Debt Securities, Available-for-sale, Fair Value to Amortized Cost | ||
Amortized cost | 6,136,544 | 4,980,102 |
Available-for-sale investment securities | 5,170,689 | 4,934,210 |
U.S. Treasury and agency securities | ||
Available-for-Sale Portfolio | ||
Amortized cost | 5,103,053 | 4,064,624 |
Available-for-sale investment securities | 4,275,440 | 3,998,564 |
Debt Securities, Available-for-sale, Fair Value to Amortized Cost | ||
Amortized cost | 5,103,053 | 4,064,624 |
Gross unrealized gains | 0 | 39,997 |
Gross unrealized losses | 827,613 | 106,057 |
Available-for-sale investment securities | 4,275,440 | 3,998,564 |
Obligations of state and political subdivisions | ||
Available-for-Sale Portfolio | ||
Amortized cost | 561,464 | 413,019 |
Available-for-sale investment securities | 489,910 | 430,289 |
Debt Securities, Available-for-sale, Fair Value to Amortized Cost | ||
Amortized cost | 561,464 | 413,019 |
Gross unrealized gains | 496 | 17,326 |
Gross unrealized losses | 72,050 | 56 |
Available-for-sale investment securities | 489,910 | 430,289 |
Government agency mortgage-backed securities | ||
Available-for-Sale Portfolio | ||
Amortized cost | 449,808 | 474,506 |
Available-for-sale investment securities | 384,891 | 477,056 |
Debt Securities, Available-for-sale, Fair Value to Amortized Cost | ||
Amortized cost | 449,808 | 474,506 |
Gross unrealized gains | 57 | 7,615 |
Gross unrealized losses | 64,974 | 5,065 |
Available-for-sale investment securities | 384,891 | 477,056 |
Corporate debt securities | ||
Available-for-Sale Portfolio | ||
Amortized cost | 8,000 | 8,000 |
Available-for-sale investment securities | 7,033 | 7,962 |
Debt Securities, Available-for-sale, Fair Value to Amortized Cost | ||
Amortized cost | 8,000 | 8,000 |
Gross unrealized gains | 0 | 39 |
Gross unrealized losses | 967 | 77 |
Available-for-sale investment securities | 7,033 | 7,962 |
Government agency collateralized mortgage obligations | ||
Available-for-Sale Portfolio | ||
Amortized cost | 14,219 | 19,953 |
Available-for-sale investment securities | 13,415 | 20,339 |
Debt Securities, Available-for-sale, Fair Value to Amortized Cost | ||
Amortized cost | 14,219 | 19,953 |
Gross unrealized gains | 1 | 410 |
Gross unrealized losses | 805 | 24 |
Available-for-sale investment securities | $ 13,415 | $ 20,339 |
INVESTMENT SECURITIES - Equity
INVESTMENT SECURITIES - Equity and Other Securities (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Equity and Other Securities | ||
Amortized cost | $ 55,665 | $ 43,917 |
Gross unrealized gains | 948 | 962 |
Gross unrealized losses | 10 | 0 |
Equity and other securities | 56,603 | 44,879 |
Equity Securities, at Fair Value | ||
Amortized cost | 251 | 251 |
Gross unrealized gains | 198 | 212 |
Gross unrealized losses | 10 | 0 |
Fair value | 439 | 463 |
Federal Home Loan Bank Common Stock | ||
Other Equity Securities, at Adjusted Cost | ||
Amortized cost | 18,438 | 7,188 |
Gross unrealized gains | 0 | 0 |
Gross unrealized losses | 0 | 0 |
Fair value | 18,438 | 7,188 |
Federal Reserve Bank Common Stock | ||
Other Equity Securities, at Adjusted Cost | ||
Amortized cost | 33,568 | 33,916 |
Gross unrealized gains | 0 | 0 |
Gross unrealized losses | 0 | 0 |
Fair value | 33,568 | 33,916 |
Other Equity Securities | ||
Other Equity Securities, at Adjusted Cost | ||
Amortized cost | 3,408 | 2,562 |
Gross unrealized gains | 750 | 750 |
Gross unrealized losses | 0 | 0 |
Fair value | $ 4,158 | $ 3,312 |
INVESTMENT SECURITIES - Investm
INVESTMENT SECURITIES - Investment Securities in a Continuous Unrealized Loss Position (Details) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 USD ($) position | Dec. 31, 2021 USD ($) position | |
Available-for-Sale Securities in Unrealized Loss Positions, Number of Positions | ||
Less than 12 months | position | 1,451 | 240 |
12 months or longer | position | 231 | 66 |
Total | position | 1,682 | 306 |
Available-for-Sale Securities, in Unrealized Loss Position, Fair Value | ||
Less than 12 months | $ 3,460,618 | $ 1,395,578 |
12 months or longer | 1,642,857 | 967,788 |
Total | 5,103,475 | 2,363,366 |
Available-for-Sale Securities, in Unrealized Loss Position, Gross Unrealized Losses | ||
Less than 12 months | 418,845 | 17,505 |
12 months or longer | 547,564 | 93,774 |
Total | $ 966,409 | $ 111,279 |
Equity and Other Securities, Continuous Unrealized Loss Position, Number of Positions | ||
Less than 12 months | position | 1 | |
12 months or longer | position | 0 | |
Total | position | 1 | |
Equity and Other Securities, Continuous Unrealized Loss Position, Fair Value | ||
Less than 12 months | $ 91 | |
12 months or longer | 0 | |
Total | 91 | |
Equity and Other Securities, Continuous Unrealized Loss Position, Gross Unrealized Losses | ||
Less than 12 months | 10 | |
12 months or longer | 0 | |
Total | $ 10 | |
Debt securities, available-for-sale, unrealized loss Position, number of positions | position | 1,682 | 306 |
Available-for-sale, allowance for credit losses | $ 0 | |
Available-for-sale Securities [Member] | ||
Equity and Other Securities, Continuous Unrealized Loss Position, Gross Unrealized Losses | ||
Accrued interest receivable | $ 18,500 | |
U.S. Treasury and agency securities | ||
Available-for-Sale Securities in Unrealized Loss Positions, Number of Positions | ||
Less than 12 months | position | 76 | 47 |
12 months or longer | position | 51 | 13 |
Total | position | 127 | 60 |
Available-for-Sale Securities, in Unrealized Loss Position, Fair Value | ||
Less than 12 months | $ 2,797,064 | $ 1,224,101 |
12 months or longer | 1,478,376 | 900,462 |
Total | 4,275,440 | 2,124,563 |
Available-for-Sale Securities, in Unrealized Loss Position, Gross Unrealized Losses | ||
Less than 12 months | 321,932 | 14,873 |
12 months or longer | 505,681 | 91,184 |
Total | $ 827,613 | $ 106,057 |
Equity and Other Securities, Continuous Unrealized Loss Position, Gross Unrealized Losses | ||
Debt securities, available-for-sale, unrealized loss Position, number of positions | position | 127 | 60 |
Obligations of state and political subdivisions | ||
Available-for-Sale Securities in Unrealized Loss Positions, Number of Positions | ||
Less than 12 months | position | 701 | 27 |
12 months or longer | position | 27 | 0 |
Total | position | 728 | 27 |
Available-for-Sale Securities, in Unrealized Loss Position, Fair Value | ||
Less than 12 months | $ 407,699 | $ 23,966 |
12 months or longer | 17,786 | 0 |
Total | 425,485 | 23,966 |
Available-for-Sale Securities, in Unrealized Loss Position, Gross Unrealized Losses | ||
Less than 12 months | 65,889 | 56 |
12 months or longer | 6,161 | 0 |
Total | $ 72,050 | $ 56 |
Equity and Other Securities, Continuous Unrealized Loss Position, Gross Unrealized Losses | ||
Debt securities, available-for-sale, unrealized loss Position, number of positions | position | 728 | 27 |
Government agency mortgage-backed securities | ||
Available-for-Sale Securities in Unrealized Loss Positions, Number of Positions | ||
Less than 12 months | position | 636 | 147 |
12 months or longer | position | 142 | 52 |
Total | position | 778 | 199 |
Available-for-Sale Securities, in Unrealized Loss Position, Fair Value | ||
Less than 12 months | $ 241,348 | $ 139,442 |
12 months or longer | 140,785 | 67,273 |
Total | 382,133 | 206,715 |
Available-for-Sale Securities, in Unrealized Loss Position, Gross Unrealized Losses | ||
Less than 12 months | 30,136 | 2,475 |
12 months or longer | 34,838 | 2,590 |
Total | $ 64,974 | $ 5,065 |
Equity and Other Securities, Continuous Unrealized Loss Position, Gross Unrealized Losses | ||
Debt securities, available-for-sale, unrealized loss Position, number of positions | position | 778 | 199 |
Corporate debt securities | ||
Available-for-Sale Securities in Unrealized Loss Positions, Number of Positions | ||
Less than 12 months | position | 1 | 1 |
12 months or longer | position | 1 | 0 |
Total | position | 2 | 1 |
Available-for-Sale Securities, in Unrealized Loss Position, Fair Value | ||
Less than 12 months | $ 2,746 | $ 4,923 |
12 months or longer | 4,287 | 0 |
Total | 7,033 | 4,923 |
Available-for-Sale Securities, in Unrealized Loss Position, Gross Unrealized Losses | ||
Less than 12 months | 254 | 77 |
12 months or longer | 713 | 0 |
Total | $ 967 | $ 77 |
Equity and Other Securities, Continuous Unrealized Loss Position, Gross Unrealized Losses | ||
Debt securities, available-for-sale, unrealized loss Position, number of positions | position | 2 | 1 |
Government agency collateralized mortgage obligations | ||
Available-for-Sale Securities in Unrealized Loss Positions, Number of Positions | ||
Less than 12 months | position | 37 | 18 |
12 months or longer | position | 10 | 1 |
Total | position | 47 | 19 |
Available-for-Sale Securities, in Unrealized Loss Position, Fair Value | ||
Less than 12 months | $ 11,761 | $ 3,146 |
12 months or longer | 1,623 | 53 |
Total | 13,384 | 3,199 |
Available-for-Sale Securities, in Unrealized Loss Position, Gross Unrealized Losses | ||
Less than 12 months | 634 | 24 |
12 months or longer | 171 | 0 |
Total | $ 805 | $ 24 |
Equity and Other Securities, Continuous Unrealized Loss Position, Gross Unrealized Losses | ||
Debt securities, available-for-sale, unrealized loss Position, number of positions | position | 47 | 19 |
Equity securities, at fair value | ||
Equity Securities, Continuous Unrealized Loss Position, Number of Positions | ||
Less than 12 Months | position | 1 | |
12 Months or Longer | position | 0 | |
Total | position | 1 | |
Equity Securities, Continuous Unrealized Loss Position, Fair Value | ||
Less than 12 Months | $ 91 | |
12 Months or Longer | 0 | |
Total | 91 | |
Equity Securities, Continuous Unrealized Loss Position, Gross Unrealized Losses | ||
Less than 12 Months | 10 | |
12 Months or Longer | 0 | |
Total | $ 10 |
INVESTMENT SECURITIES - Amortiz
INVESTMENT SECURITIES - Amortized Cost and Estimated Fair Value of Debt Securities by Contractual Maturity (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Available-for-Sale, Debt Maturities, Amortized Cost | ||
Due in one year or less | $ 546,740 | |
Due after one through five years | 1,420,259 | |
Due after five years through ten years | 2,055,716 | |
Due after ten years | 1,649,802 | |
Subtotal | 5,672,517 | |
Amortized cost | 6,136,544 | $ 4,980,102 |
Available-for-Sale, Debt Maturities, Fair Value | ||
Due in one year or less | 541,161 | |
Due after one through five years | 1,297,201 | |
Due after five years through ten years | 1,762,074 | |
Due after ten years | 1,171,947 | |
Subtotal | 4,772,383 | |
Fair value | 5,170,689 | 4,934,210 |
Government agency mortgage-backed securities | ||
Available-for-Sale, Debt Maturities, Amortized Cost | ||
Without single maturity date | 449,808 | |
Amortized cost | 449,808 | 474,506 |
Available-for-Sale, Debt Maturities, Fair Value | ||
Without single maturity date | 384,891 | |
Fair value | 384,891 | 477,056 |
Government agency collateralized mortgage obligations | ||
Available-for-Sale, Debt Maturities, Amortized Cost | ||
Without single maturity date | 14,219 | |
Amortized cost | 14,219 | 19,953 |
Available-for-Sale, Debt Maturities, Fair Value | ||
Without single maturity date | 13,415 | |
Fair value | $ 13,415 | $ 20,339 |
INVESTMENT SECURITIES - Inves_2
INVESTMENT SECURITIES - Investment Securities Pledged as Collateral (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Investment Securities Pledged as Collateral | ||
Investment securities pledged to collateralize certain deposits and borrowings | $ 2,410 | $ 2,320 |
Debt Securities, Pledged Status [Extensible Enumeration] | us-gaap:AssetPledgedAsCollateralWithoutRightMember | us-gaap:AssetPledgedAsCollateralWithoutRightMember |
Debt Securities, Pledging Purpose [Extensible Enumeration] | Deposits | Deposits |
U.S. Treasury and agency securities | Securities Sold under Agreements to Repurchase | ||
Investment Securities Pledged as Collateral | ||
Investment securities pledged to collateralize certain deposits and borrowings | $ 427.2 | $ 485.4 |
LOANS AND ALLOWANCE FOR CREDI_3
LOANS AND ALLOWANCE FOR CREDIT LOSSES - Loan Summary (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Loans receivable, net | ||
Gross loans, including deferred origination costs | $ 8,543,607 | $ 7,373,639 |
Allowance for credit losses | (60,363) | (49,869) |
Net loans | 8,483,244 | 7,323,770 |
Business lending | ||
Loans receivable, net | ||
Gross loans, including deferred origination costs | 3,494,425 | 3,075,904 |
Consumer mortgage | ||
Loans receivable, net | ||
Gross loans, including deferred origination costs | 2,975,521 | 2,556,114 |
Consumer indirect | ||
Loans receivable, net | ||
Gross loans, including deferred origination costs | 1,461,235 | 1,189,749 |
Consumer direct | ||
Loans receivable, net | ||
Gross loans, including deferred origination costs | 179,399 | 153,811 |
Home equity | ||
Loans receivable, net | ||
Gross loans, including deferred origination costs | 433,027 | 398,061 |
Commercial Portfolio Segment | Business lending | ||
Loans receivable, net | ||
Gross loans, including deferred origination costs | 3,494,425 | 3,075,904 |
Residential Portfolio Segment | Consumer mortgage | ||
Loans receivable, net | ||
Gross loans, including deferred origination costs | 2,975,521 | 2,556,114 |
Residential Portfolio Segment | Home equity | ||
Loans receivable, net | ||
Gross loans, including deferred origination costs | 433,027 | 398,061 |
Consumer Portfolio Segment | Consumer indirect | ||
Loans receivable, net | ||
Gross loans, including deferred origination costs | 1,461,235 | 1,189,749 |
Consumer Portfolio Segment | Consumer direct | ||
Loans receivable, net | ||
Gross loans, including deferred origination costs | $ 179,399 | $ 153,811 |
LOANS AND ALLOWANCE FOR CREDI_4
LOANS AND ALLOWANCE FOR CREDIT LOSSES - Credit Quality By Past Due Status (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2022 | Dec. 31, 2021 | |
Aged analysis of the company's loans | |||
Total Loans | $ 8,543,607 | $ 8,543,607 | $ 7,373,639 |
Interest income on nonaccrual loans | 0 | 0 | |
Legacy Loan | |||
Aged analysis of the company's loans | |||
Total Loans | 8,543,607 | 8,543,607 | 7,373,639 |
Nonaccrual | 28,076 | 28,076 | 41,665 |
Legacy Loan | Financial Asset, Past Due | |||
Aged analysis of the company's loans | |||
Total Loans | 60,324 | 60,324 | 73,495 |
Legacy Loan | Past Due 30 - 89 Days | |||
Aged analysis of the company's loans | |||
Total Loans | 27,832 | 27,832 | 28,022 |
Legacy Loan | 90+ Days Past Due and Still Accruing | |||
Aged analysis of the company's loans | |||
Total Loans | 4,416 | 4,416 | 3,808 |
Legacy Loan | Financial Asset, Not Past Due | |||
Aged analysis of the company's loans | |||
Total Loans | 8,483,283 | 8,483,283 | 7,300,144 |
Business lending | |||
Aged analysis of the company's loans | |||
Total Loans | 3,494,425 | 3,494,425 | 3,075,904 |
Consumer mortgage | |||
Aged analysis of the company's loans | |||
Total Loans | 2,975,521 | 2,975,521 | 2,556,114 |
Consumer indirect | |||
Aged analysis of the company's loans | |||
Total Loans | 1,461,235 | 1,461,235 | 1,189,749 |
Consumer direct | |||
Aged analysis of the company's loans | |||
Total Loans | 179,399 | 179,399 | 153,811 |
Home equity | |||
Aged analysis of the company's loans | |||
Total Loans | 433,027 | 433,027 | 398,061 |
Commercial Portfolio Segment | Business lending | |||
Aged analysis of the company's loans | |||
Total Loans | 3,494,425 | 3,494,425 | 3,075,904 |
Commercial Portfolio Segment | Business lending | Legacy Loan | |||
Aged analysis of the company's loans | |||
Total Loans | 3,494,425 | 3,494,425 | 3,075,904 |
Nonaccrual | 4,848 | 4,848 | 24,105 |
Commercial Portfolio Segment | Business lending | Legacy Loan | Financial Asset, Past Due | |||
Aged analysis of the company's loans | |||
Total Loans | 5,887 | 5,887 | 29,744 |
Commercial Portfolio Segment | Business lending | Legacy Loan | Past Due 30 - 89 Days | |||
Aged analysis of the company's loans | |||
Total Loans | 1,039 | 1,039 | 5,540 |
Commercial Portfolio Segment | Business lending | Legacy Loan | 90+ Days Past Due and Still Accruing | |||
Aged analysis of the company's loans | |||
Total Loans | 0 | 0 | 99 |
Commercial Portfolio Segment | Business lending | Legacy Loan | Financial Asset, Not Past Due | |||
Aged analysis of the company's loans | |||
Total Loans | 3,488,538 | 3,488,538 | 3,046,160 |
Residential Portfolio Segment | Consumer mortgage | |||
Aged analysis of the company's loans | |||
Total Loans | 2,975,521 | 2,975,521 | 2,556,114 |
Residential Portfolio Segment | Consumer mortgage | Legacy Loan | |||
Aged analysis of the company's loans | |||
Total Loans | 2,975,521 | 2,975,521 | 2,556,114 |
Nonaccrual | 20,890 | 20,890 | 15,027 |
Residential Portfolio Segment | Consumer mortgage | Legacy Loan | Financial Asset, Past Due | |||
Aged analysis of the company's loans | |||
Total Loans | 37,025 | 37,025 | 28,652 |
Residential Portfolio Segment | Consumer mortgage | Legacy Loan | Past Due 30 - 89 Days | |||
Aged analysis of the company's loans | |||
Total Loans | 12,138 | 12,138 | 10,297 |
Residential Portfolio Segment | Consumer mortgage | Legacy Loan | 90+ Days Past Due and Still Accruing | |||
Aged analysis of the company's loans | |||
Total Loans | 3,997 | 3,997 | 3,328 |
Residential Portfolio Segment | Consumer mortgage | Legacy Loan | Financial Asset, Not Past Due | |||
Aged analysis of the company's loans | |||
Total Loans | 2,938,496 | 2,938,496 | 2,527,462 |
Residential Portfolio Segment | Home equity | |||
Aged analysis of the company's loans | |||
Total Loans | 433,027 | 433,027 | 398,061 |
Residential Portfolio Segment | Home equity | Legacy Loan | |||
Aged analysis of the company's loans | |||
Total Loans | 433,027 | 433,027 | 398,061 |
Nonaccrual | 2,309 | 2,309 | 2,532 |
Residential Portfolio Segment | Home equity | Legacy Loan | Financial Asset, Past Due | |||
Aged analysis of the company's loans | |||
Total Loans | 4,236 | 4,236 | 4,582 |
Residential Portfolio Segment | Home equity | Legacy Loan | Past Due 30 - 89 Days | |||
Aged analysis of the company's loans | |||
Total Loans | 1,761 | 1,761 | 1,778 |
Residential Portfolio Segment | Home equity | Legacy Loan | 90+ Days Past Due and Still Accruing | |||
Aged analysis of the company's loans | |||
Total Loans | 166 | 166 | 272 |
Residential Portfolio Segment | Home equity | Legacy Loan | Financial Asset, Not Past Due | |||
Aged analysis of the company's loans | |||
Total Loans | 428,791 | 428,791 | 393,479 |
Consumer Portfolio Segment | Consumer indirect | |||
Aged analysis of the company's loans | |||
Total Loans | 1,461,235 | 1,461,235 | 1,189,749 |
Consumer Portfolio Segment | Consumer indirect | Legacy Loan | |||
Aged analysis of the company's loans | |||
Total Loans | 1,461,235 | 1,461,235 | 1,189,749 |
Nonaccrual | 0 | 0 | 0 |
Consumer Portfolio Segment | Consumer indirect | Legacy Loan | Financial Asset, Past Due | |||
Aged analysis of the company's loans | |||
Total Loans | 12,153 | 12,153 | 9,698 |
Consumer Portfolio Segment | Consumer indirect | Legacy Loan | Past Due 30 - 89 Days | |||
Aged analysis of the company's loans | |||
Total Loans | 11,938 | 11,938 | 9,611 |
Consumer Portfolio Segment | Consumer indirect | Legacy Loan | 90+ Days Past Due and Still Accruing | |||
Aged analysis of the company's loans | |||
Total Loans | 215 | 215 | 87 |
Consumer Portfolio Segment | Consumer indirect | Legacy Loan | Financial Asset, Not Past Due | |||
Aged analysis of the company's loans | |||
Total Loans | 1,449,082 | 1,449,082 | 1,180,051 |
Consumer Portfolio Segment | Consumer direct | |||
Aged analysis of the company's loans | |||
Total Loans | 179,399 | 179,399 | 153,811 |
Consumer Portfolio Segment | Consumer direct | Legacy Loan | |||
Aged analysis of the company's loans | |||
Total Loans | 179,399 | 179,399 | 153,811 |
Nonaccrual | 29 | 29 | 1 |
Consumer Portfolio Segment | Consumer direct | Legacy Loan | Financial Asset, Past Due | |||
Aged analysis of the company's loans | |||
Total Loans | 1,023 | 1,023 | 819 |
Consumer Portfolio Segment | Consumer direct | Legacy Loan | Past Due 30 - 89 Days | |||
Aged analysis of the company's loans | |||
Total Loans | 956 | 956 | 796 |
Consumer Portfolio Segment | Consumer direct | Legacy Loan | 90+ Days Past Due and Still Accruing | |||
Aged analysis of the company's loans | |||
Total Loans | 38 | 38 | 22 |
Consumer Portfolio Segment | Consumer direct | Legacy Loan | Financial Asset, Not Past Due | |||
Aged analysis of the company's loans | |||
Total Loans | $ 178,376 | $ 178,376 | $ 152,992 |
LOANS AND ALLOWANCE FOR CREDI_5
LOANS AND ALLOWANCE FOR CREDIT LOSSES - Amount of Business Lending Loans by Credit Quality Categories (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Term Loans Amortized Cost Basis by Origination Year | ||
Total Loans | $ 8,543,607 | $ 7,373,639 |
Legacy Loan | ||
Term Loans Amortized Cost Basis by Origination Year | ||
Total Loans | 8,543,607 | 7,373,639 |
Business lending | ||
Term Loans Amortized Cost Basis by Origination Year | ||
2022 | 620,848 | |
2021 | 428,815 | 532,141 |
2020 | 312,207 | 341,665 |
2019 | 333,463 | 351,064 |
2018 | 291,095 | 334,790 |
Prior | 831,147 | |
2017 | 230,502 | |
Prior | 705,731 | |
Revolving Loans Amortized Cost Basis | 676,850 | 580,011 |
Total Loans | 3,494,425 | 3,075,904 |
Business lending | Pass | ||
Term Loans Amortized Cost Basis by Origination Year | ||
2022 | 617,776 | |
2021 | 422,638 | 524,302 |
2020 | 306,960 | 328,885 |
2019 | 325,181 | 320,638 |
2018 | 249,442 | 248,175 |
Prior | 710,320 | |
2017 | 186,074 | |
Prior | 584,912 | |
Revolving Loans Amortized Cost Basis | 636,686 | 524,553 |
Total Loans | 3,269,003 | 2,717,539 |
Business lending | Special mention | ||
Term Loans Amortized Cost Basis by Origination Year | ||
2022 | 2,236 | |
2021 | 5,229 | 5,969 |
2020 | 3,988 | 11,013 |
2019 | 4,442 | 10,111 |
2018 | 13,155 | 46,318 |
Prior | 64,432 | |
2017 | 22,524 | |
Prior | 57,134 | |
Revolving Loans Amortized Cost Basis | 31,447 | 27,444 |
Total Loans | 124,929 | 180,513 |
Business lending | Classified | ||
Term Loans Amortized Cost Basis by Origination Year | ||
2022 | 836 | |
2021 | 948 | 1,870 |
2020 | 1,259 | 1,767 |
2019 | 3,840 | 20,315 |
2018 | 28,498 | 40,235 |
Prior | 56,395 | |
2017 | 21,904 | |
Prior | 63,685 | |
Revolving Loans Amortized Cost Basis | 8,717 | 27,511 |
Total Loans | 100,493 | 177,287 |
Business lending | Doubtful | ||
Term Loans Amortized Cost Basis by Origination Year | ||
2022 | 0 | |
2021 | 0 | 0 |
2020 | 0 | 0 |
2019 | 0 | 0 |
2018 | 0 | 62 |
Prior | 0 | |
2017 | 0 | |
Prior | 0 | |
Revolving Loans Amortized Cost Basis | 0 | 503 |
Total Loans | 0 | 565 |
Consumer mortgage | ||
Term Loans Amortized Cost Basis by Origination Year | ||
2022 | 471,639 | |
2021 | 707,391 | 683,550 |
2020 | 354,226 | 352,373 |
2019 | 270,282 | 269,694 |
2018 | 162,830 | 173,187 |
Prior | 984,139 | |
2017 | 172,187 | |
Prior | 880,095 | |
Revolving Loans Amortized Cost Basis | 25,014 | 25,028 |
Total Loans | 2,975,521 | 2,556,114 |
Consumer mortgage | FICO AB | ||
Term Loans Amortized Cost Basis by Origination Year | ||
2022 | 346,061 | |
2021 | 516,066 | 514,680 |
2020 | 231,950 | 229,305 |
2019 | 183,330 | 183,469 |
2018 | 104,281 | 113,749 |
Prior | 634,567 | |
2017 | 116,852 | |
Prior | 569,365 | |
Revolving Loans Amortized Cost Basis | 1,799 | 0 |
Total Loans | 2,018,054 | 1,727,420 |
Consumer mortgage | FICO AB | Performing | ||
Term Loans Amortized Cost Basis by Origination Year | ||
2022 | 346,061 | |
2021 | 516,066 | 514,680 |
2020 | 231,558 | 229,039 |
2019 | 182,908 | 183,469 |
2018 | 103,874 | 113,618 |
Prior | 629,948 | |
2017 | 116,417 | |
Prior | 566,129 | |
Revolving Loans Amortized Cost Basis | 1,799 | 0 |
Total Loans | 2,012,214 | 1,723,352 |
Consumer mortgage | FICO AB | Nonperforming | ||
Term Loans Amortized Cost Basis by Origination Year | ||
2022 | 0 | |
2021 | 0 | 0 |
2020 | 392 | 266 |
2019 | 422 | 0 |
2018 | 407 | 131 |
Prior | 4,619 | |
2017 | 435 | |
Prior | 3,236 | |
Revolving Loans Amortized Cost Basis | 0 | 0 |
Total Loans | 5,840 | 4,068 |
Consumer mortgage | FICO CDE | ||
Term Loans Amortized Cost Basis by Origination Year | ||
2022 | 125,578 | |
2021 | 191,325 | 168,870 |
2020 | 122,276 | 123,068 |
2019 | 86,952 | 86,225 |
2018 | 58,549 | 59,438 |
Prior | 349,572 | |
2017 | 55,335 | |
Prior | 310,730 | |
Revolving Loans Amortized Cost Basis | 23,215 | 25,028 |
Total Loans | 957,467 | 828,694 |
Consumer mortgage | FICO CDE | Performing | ||
Term Loans Amortized Cost Basis by Origination Year | ||
2022 | 125,340 | |
2021 | 190,264 | 168,870 |
2020 | 120,575 | 122,546 |
2019 | 85,509 | 85,253 |
2018 | 57,082 | 57,973 |
Prior | 336,435 | |
2017 | 54,396 | |
Prior | 300,341 | |
Revolving Loans Amortized Cost Basis | 23,215 | 25,028 |
Total Loans | 938,420 | 814,407 |
Consumer mortgage | FICO CDE | Nonperforming | ||
Term Loans Amortized Cost Basis by Origination Year | ||
2022 | 238 | |
2021 | 1,061 | 0 |
2020 | 1,701 | 522 |
2019 | 1,443 | 972 |
2018 | 1,467 | 1,465 |
Prior | 13,137 | |
2017 | 939 | |
Prior | 10,389 | |
Revolving Loans Amortized Cost Basis | 0 | 0 |
Total Loans | 19,047 | 14,287 |
Consumer indirect | ||
Term Loans Amortized Cost Basis by Origination Year | ||
2022 | 620,718 | |
2021 | 453,613 | 590,857 |
2020 | 143,737 | 204,563 |
2019 | 115,312 | 182,458 |
2018 | 62,545 | 107,707 |
Prior | 65,310 | |
2017 | 39,402 | |
Prior | 64,762 | |
Revolving Loans Amortized Cost Basis | 0 | 0 |
Total Loans | 1,461,235 | 1,189,749 |
Consumer indirect | Performing | ||
Term Loans Amortized Cost Basis by Origination Year | ||
2022 | 620,692 | |
2021 | 453,478 | 590,857 |
2020 | 143,702 | 204,529 |
2019 | 115,304 | 182,458 |
2018 | 62,534 | 107,683 |
Prior | 65,310 | |
2017 | 39,385 | |
Prior | 64,750 | |
Revolving Loans Amortized Cost Basis | 0 | 0 |
Total Loans | 1,461,020 | 1,189,662 |
Consumer indirect | Nonperforming | ||
Term Loans Amortized Cost Basis by Origination Year | ||
2022 | 26 | |
2021 | 135 | 0 |
2020 | 35 | 34 |
2019 | 8 | 0 |
2018 | 11 | 24 |
Prior | 0 | |
2017 | 17 | |
Prior | 12 | |
Revolving Loans Amortized Cost Basis | 0 | 0 |
Total Loans | 215 | 87 |
Consumer direct | ||
Term Loans Amortized Cost Basis by Origination Year | ||
2022 | 72,531 | |
2021 | 52,234 | 72,584 |
2020 | 19,837 | 28,909 |
2019 | 15,549 | 24,788 |
2018 | 7,074 | 12,341 |
Prior | 5,627 | |
2017 | 4,396 | |
Prior | 4,575 | |
Revolving Loans Amortized Cost Basis | 6,547 | 6,218 |
Total Loans | 179,399 | 153,811 |
Consumer direct | Performing | ||
Term Loans Amortized Cost Basis by Origination Year | ||
2022 | 72,531 | |
2021 | 52,234 | 72,584 |
2020 | 19,832 | 28,905 |
2019 | 15,548 | 24,770 |
2018 | 7,045 | 12,340 |
Prior | 5,615 | |
2017 | 4,396 | |
Prior | 4,575 | |
Revolving Loans Amortized Cost Basis | 6,527 | 6,218 |
Total Loans | 179,332 | 153,788 |
Consumer direct | Nonperforming | ||
Term Loans Amortized Cost Basis by Origination Year | ||
2022 | 0 | |
2021 | 0 | 0 |
2020 | 5 | 4 |
2019 | 1 | 18 |
2018 | 29 | 1 |
Prior | 12 | |
2017 | 0 | |
Prior | 0 | |
Revolving Loans Amortized Cost Basis | 20 | 0 |
Total Loans | 67 | 23 |
Home equity | ||
Term Loans Amortized Cost Basis by Origination Year | ||
2022 | 55,553 | |
2021 | 74,666 | 76,041 |
2020 | 39,580 | 43,170 |
2019 | 33,335 | 36,037 |
2018 | 17,328 | 18,926 |
Prior | 45,174 | |
2017 | 15,265 | |
Prior | 36,419 | |
Revolving Loans Amortized Cost Basis | 167,391 | 172,203 |
Total Loans | 433,027 | 398,061 |
Home equity | Performing | ||
Term Loans Amortized Cost Basis by Origination Year | ||
2022 | 55,553 | |
2021 | 74,656 | 76,041 |
2020 | 39,458 | 43,106 |
2019 | 33,137 | 35,990 |
2018 | 17,175 | 18,824 |
Prior | 44,513 | |
2017 | 15,134 | |
Prior | 35,740 | |
Revolving Loans Amortized Cost Basis | 166,060 | 170,422 |
Total Loans | 430,552 | 395,257 |
Home equity | Nonperforming | ||
Term Loans Amortized Cost Basis by Origination Year | ||
2022 | 0 | |
2021 | 10 | 0 |
2020 | 122 | 64 |
2019 | 198 | 47 |
2018 | 153 | 102 |
Prior | 661 | |
2017 | 131 | |
Prior | 679 | |
Revolving Loans Amortized Cost Basis | 1,331 | 1,781 |
Total Loans | $ 2,475 | $ 2,804 |
LOANS AND ALLOWANCE FOR CREDI_6
LOANS AND ALLOWANCE FOR CREDIT LOSSES - Summary of Impaired Loans, Excluding Purchased Impaired (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Impaired loans | |||||
Loans with allowance allocation | $ 0 | $ 0 | $ 7,102 | ||
Loans without allowance allocation | 3,232 | 3,232 | 7,417 | ||
Carrying balance | 3,232 | 3,232 | 14,519 | ||
Contractual balance | 4,201 | 4,201 | 16,963 | ||
Specifically allocated allowance | 0 | 0 | $ 566 | ||
Average carrying balance of individually assessed loans | 3,200 | $ 31,500 | 12,200 | $ 34,100 | |
Interest income on individually assessed loans | $ 0 | $ 0 | $ 0 | $ 0 |
LOANS AND ALLOWANCE FOR CREDI_7
LOANS AND ALLOWANCE FOR CREDIT LOSSES - Troubled Debt Restructurings (TDRs) (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 USD ($) loan | Sep. 30, 2021 USD ($) loan | Sep. 30, 2022 USD ($) loan | Sep. 30, 2021 USD ($) loan | Dec. 31, 2021 USD ($) loan | |
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |||||
TDRs, number | loan | 194 | 194 | 232 | ||
TDRs, amount | $ 5,857 | $ 5,857 | $ 8,239 | ||
Loans modified in TDR during the year, number | loan | 9 | 20 | 20 | 43 | |
Loans modified in TDR during the year, amount | $ 258 | $ 2,733 | $ 595 | $ 3,348 | |
Minimum | |||||
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |||||
Threshold balance of loan individually evaluated for impairment | $ 500 | $ 500 | |||
Nonaccrual | |||||
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |||||
TDRs, number | loan | 67 | 67 | 81 | ||
TDRs, amount | $ 2,685 | $ 2,685 | $ 3,940 | ||
Accruing | |||||
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |||||
TDRs, number | loan | 127 | 127 | 151 | ||
TDRs, amount | $ 3,172 | $ 3,172 | $ 4,299 | ||
Commercial Portfolio Segment | Business lending | |||||
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |||||
TDRs, number | loan | 5 | 5 | 14 | ||
TDRs, amount | $ 443 | $ 443 | $ 1,822 | ||
Loans modified in TDR during the year, number | loan | 0 | 5 | 0 | 5 | |
Loans modified in TDR during the year, amount | $ 0 | $ 1,925 | $ 0 | $ 1,925 | |
Commercial Portfolio Segment | Business lending | Nonaccrual | |||||
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |||||
TDRs, number | loan | 2 | 2 | 10 | ||
TDRs, amount | $ 161 | $ 161 | $ 1,011 | ||
Commercial Portfolio Segment | Business lending | Accruing | |||||
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |||||
TDRs, number | loan | 3 | 3 | 4 | ||
TDRs, amount | $ 282 | $ 282 | $ 811 | ||
Residential Portfolio Segment | Consumer mortgage | |||||
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |||||
TDRs, number | loan | 100 | 100 | 108 | ||
TDRs, amount | $ 4,449 | $ 4,449 | $ 5,114 | ||
Loans modified in TDR during the year, number | loan | 1 | 9 | 5 | 19 | |
Loans modified in TDR during the year, amount | $ 184 | $ 728 | $ 459 | $ 1,193 | |
Residential Portfolio Segment | Consumer mortgage | Nonaccrual | |||||
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |||||
TDRs, number | loan | 56 | 56 | 61 | ||
TDRs, amount | $ 2,408 | $ 2,408 | $ 2,694 | ||
Residential Portfolio Segment | Consumer mortgage | Accruing | |||||
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |||||
TDRs, number | loan | 44 | 44 | 47 | ||
TDRs, amount | $ 2,041 | $ 2,041 | $ 2,420 | ||
Residential Portfolio Segment | Home equity | |||||
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |||||
TDRs, number | loan | 19 | 19 | 22 | ||
TDRs, amount | $ 333 | $ 333 | $ 467 | ||
Loans modified in TDR during the year, number | loan | 0 | 0 | 1 | 0 | |
Loans modified in TDR during the year, amount | $ 0 | $ 0 | $ 6 | $ 0 | |
Residential Portfolio Segment | Home equity | Nonaccrual | |||||
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |||||
TDRs, number | loan | 9 | 9 | 10 | ||
TDRs, amount | $ 116 | $ 116 | $ 235 | ||
Residential Portfolio Segment | Home equity | Accruing | |||||
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |||||
TDRs, number | loan | 10 | 10 | 12 | ||
TDRs, amount | $ 217 | $ 217 | $ 232 | ||
Consumer Portfolio Segment | Consumer indirect | |||||
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |||||
TDRs, number | loan | 59 | 59 | 72 | ||
TDRs, amount | $ 628 | $ 628 | $ 829 | ||
Loans modified in TDR during the year, number | loan | 6 | 5 | 12 | 17 | |
Loans modified in TDR during the year, amount | $ 71 | $ 78 | $ 127 | $ 222 | |
Consumer Portfolio Segment | Consumer indirect | Nonaccrual | |||||
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |||||
TDRs, number | loan | 0 | 0 | 0 | ||
TDRs, amount | $ 0 | $ 0 | $ 0 | ||
Consumer Portfolio Segment | Consumer indirect | Accruing | |||||
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |||||
TDRs, number | loan | 59 | 59 | 72 | ||
TDRs, amount | $ 628 | $ 628 | $ 829 | ||
Consumer Portfolio Segment | Consumer direct | |||||
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |||||
TDRs, number | loan | 11 | 11 | 16 | ||
TDRs, amount | $ 4 | $ 4 | $ 7 | ||
Loans modified in TDR during the year, number | loan | 2 | 1 | 2 | 2 | |
Loans modified in TDR during the year, amount | $ 3 | $ 2 | $ 3 | $ 8 | |
Consumer Portfolio Segment | Consumer direct | Nonaccrual | |||||
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |||||
TDRs, number | loan | 0 | 0 | 0 | ||
TDRs, amount | $ 0 | $ 0 | $ 0 | ||
Consumer Portfolio Segment | Consumer direct | Accruing | |||||
LOANS AND ALLOWANCE FOR CREDIT LOSSES | |||||
TDRs, number | loan | 11 | 11 | 16 | ||
TDRs, amount | $ 4 | $ 4 | $ 7 |
LOANS AND ALLOWANCE FOR CREDI_8
LOANS AND ALLOWANCE FOR CREDIT LOSSES - Allowance for Credit Losses (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||||
May 13, 2022 USD ($) | Dec. 31, 2021 USD ($) | Sep. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | |
Allowance for credit losses - loans | |||||||
Beginning Balance | $ 55,542 | $ 51,750 | $ 49,869 | $ 60,869 | |||
Charge-offs | (2,688) | (2,703) | (6,991) | (5,775) | |||
Recoveries | 2,330 | 1,353 | 5,711 | 4,636 | |||
PCD Allowance at Acquisition | 71 | ||||||
Provision | 5,179 | (901) | 11,703 | (10,231) | |||
Ending Balance | $ 49,869 | $ 49,499 | 60,363 | 49,499 | 60,363 | 49,499 | |
Liabilities for off-balance-sheet credit exposures | |||||||
Beginning balance | 1,223 | 762 | 803 | 1,489 | |||
Charge-offs | 0 | 0 | 0 | 0 | |||
Recoveries | 0 | 0 | 0 | 0 | |||
PCD allowance at acquisition | (43) | 0 | |||||
Provision | (118) | 302 | (770) | ||||
Ending balance | $ 803 | $ 719 | $ 1,105 | 719 | $ 1,105 | 719 | |
Allowance for Credit Losses | |||||||
Allowance for credit losses to total loans ratio | 0.71 | 0.71 | |||||
Provision for credit losses | $ 5,061 | (944) | $ 12,005 | (11,001) | |||
Basis points lower level | 3 | 3 | |||||
Accrued interest and fees receivable | 19,800 | 19,800 | |||||
Total allowance for credit losses | |||||||
Beginning balance | 56,765 | 52,512 | 50,672 | 62,358 | |||
Charge-offs | (2,688) | (2,703) | (6,991) | (5,775) | |||
Recoveries | 2,330 | 1,353 | 5,711 | 4,636 | |||
PCD Allowance at Acquisition | 71 | ||||||
Provision | 5,061 | (944) | 12,005 | (11,001) | |||
Ending balance | $ 50,672 | $ 50,218 | 61,468 | 50,218 | 61,468 | 50,218 | |
Elmira Savings Bank | |||||||
Allowance for Credit Losses | |||||||
Provision for credit losses | $ 3,900 | 3,900 | 3,900 | ||||
Commercial Portfolio Segment | Business lending | |||||||
Allowance for credit losses - loans | |||||||
Beginning Balance | 23,241 | 25,302 | 22,995 | 30,072 | |||
Charge-offs | (495) | (872) | (650) | (925) | |||
Recoveries | 755 | 204 | 1,249 | 586 | |||
PCD Allowance at Acquisition | 71 | ||||||
Provision | 430 | (2,315) | 266 | (7,414) | |||
Ending Balance | 22,995 | 22,319 | 23,931 | 22,319 | 23,931 | 22,319 | |
Total allowance for credit losses | |||||||
Charge-offs | (495) | (872) | (650) | (925) | |||
Recoveries | 755 | 204 | 1,249 | 586 | |||
PCD Allowance at Acquisition | 71 | ||||||
Residential Portfolio Segment | Consumer mortgage | |||||||
Allowance for credit losses - loans | |||||||
Beginning Balance | 12,631 | 10,001 | 10,017 | 10,672 | |||
Charge-offs | (113) | (127) | (230) | (369) | |||
Recoveries | 4 | 3 | 21 | 22 | |||
PCD Allowance at Acquisition | 0 | ||||||
Provision | 1,296 | (132) | 4,010 | (580) | |||
Ending Balance | 10,017 | 9,745 | 13,818 | 9,745 | 13,818 | 9,745 | |
Total allowance for credit losses | |||||||
Charge-offs | (113) | (127) | (230) | (369) | |||
Recoveries | 4 | 3 | 21 | 22 | |||
PCD Allowance at Acquisition | 0 | ||||||
Residential Portfolio Segment | Home equity | |||||||
Allowance for credit losses - loans | |||||||
Beginning Balance | 1,470 | 1,796 | 1,814 | 2,222 | |||
Charge-offs | (32) | (30) | (69) | (145) | |||
Recoveries | 11 | 10 | 132 | 19 | |||
PCD Allowance at Acquisition | 0 | ||||||
Provision | 132 | (56) | (296) | (376) | |||
Ending Balance | 1,814 | 1,720 | 1,581 | 1,720 | 1,581 | 1,720 | |
Total allowance for credit losses | |||||||
Charge-offs | (32) | (30) | (69) | (145) | |||
Recoveries | 11 | 10 | 132 | 19 | |||
PCD Allowance at Acquisition | 0 | ||||||
Consumer Portfolio Segment | Consumer indirect | |||||||
Allowance for credit losses - loans | |||||||
Beginning Balance | 14,378 | 11,103 | 11,737 | 13,696 | |||
Charge-offs | (1,706) | (1,365) | (5,183) | (3,514) | |||
Recoveries | 1,386 | 973 | 3,732 | 3,402 | |||
PCD Allowance at Acquisition | 0 | ||||||
Provision | 2,960 | 1,334 | 6,732 | (1,539) | |||
Ending Balance | 11,737 | 12,045 | 17,018 | 12,045 | 17,018 | 12,045 | |
Total allowance for credit losses | |||||||
Charge-offs | (1,706) | (1,365) | (5,183) | (3,514) | |||
Recoveries | 1,386 | 973 | 3,732 | 3,402 | |||
PCD Allowance at Acquisition | 0 | ||||||
Consumer Portfolio Segment | Consumer direct | |||||||
Allowance for credit losses - loans | |||||||
Beginning Balance | 2,822 | 2,548 | 2,306 | 3,207 | |||
Charge-offs | (342) | (309) | (859) | (822) | |||
Recoveries | 174 | 163 | 577 | 607 | |||
PCD Allowance at Acquisition | 0 | ||||||
Provision | 361 | 268 | 991 | (322) | |||
Ending Balance | 2,306 | 2,670 | 3,015 | 2,670 | 3,015 | 2,670 | |
Total allowance for credit losses | |||||||
Charge-offs | (342) | (309) | (859) | (822) | |||
Recoveries | 174 | 163 | 577 | 607 | |||
PCD Allowance at Acquisition | 0 | ||||||
Unallocated | |||||||
Allowance for credit losses - loans | |||||||
Beginning Balance | 1,000 | 1,000 | 1,000 | 1,000 | |||
Charge-offs | 0 | 0 | 0 | 0 | |||
Recoveries | 0 | 0 | 0 | 0 | |||
PCD Allowance at Acquisition | 0 | ||||||
Provision | 0 | 0 | 0 | 0 | |||
Ending Balance | $ 1,000 | $ 1,000 | 1,000 | 1,000 | 1,000 | 1,000 | |
Total allowance for credit losses | |||||||
Charge-offs | 0 | 0 | 0 | 0 | |||
Recoveries | $ 0 | $ 0 | 0 | $ 0 | |||
PCD Allowance at Acquisition | $ 0 |
LOANS AND ALLOWANCE FOR CREDI_9
LOANS AND ALLOWANCE FOR CREDIT LOSSES - Carrying Amounts of Loans Purchased and Sold (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
Carrying Amounts of Loans Purchased and Sold | |
Purchases | $ 437,019 |
Sales | 4,541 |
Commercial Portfolio Segment | Business lending | |
Carrying Amounts of Loans Purchased and Sold | |
Purchases | 125,288 |
Sales | 0 |
Residential Portfolio Segment | Consumer mortgage | |
Carrying Amounts of Loans Purchased and Sold | |
Purchases | 271,408 |
Sales | 4,541 |
Residential Portfolio Segment | Home equity | |
Carrying Amounts of Loans Purchased and Sold | |
Purchases | 18,429 |
Sales | 0 |
Consumer Portfolio Segment | Consumer indirect | |
Carrying Amounts of Loans Purchased and Sold | |
Purchases | 9,383 |
Sales | 0 |
Consumer Portfolio Segment | Consumer direct | |
Carrying Amounts of Loans Purchased and Sold | |
Purchases | 12,511 |
Sales | $ 0 |
GOODWILL AND IDENTIFIABLE INT_3
GOODWILL AND IDENTIFIABLE INTANGIBLE ASSETS (Details) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Identifiable Intangible Assets | ||
Gross Carrying Amount | $ 196,636 | $ 186,202 |
Accumulated Amortization | (132,396) | (120,976) |
Net Carrying Amount | 64,240 | 65,226 |
Estimated aggregate amortization expense for each of five succeeding fiscal years | ||
Oct - Dec 2022 | 3,771 | |
2023 | 13,567 | |
2024 | 11,482 | |
2025 | 9,783 | |
2026 | 8,685 | |
Thereafter | 16,952 | |
Net Carrying Amount | 64,240 | 65,226 |
Components of goodwill | ||
Goodwill, net, beginning of period | 799,109 | |
Goodwill, net, activity | 45,875 | |
Goodwill, net, end of period | 844,984 | |
Core deposit intangibles | ||
Identifiable Intangible Assets | ||
Gross Carrying Amount | 77,373 | 69,403 |
Accumulated Amortization | (63,823) | (60,316) |
Net Carrying Amount | 13,550 | 9,087 |
Estimated aggregate amortization expense for each of five succeeding fiscal years | ||
Net Carrying Amount | 13,550 | 9,087 |
Other intangibles | ||
Identifiable Intangible Assets | ||
Gross Carrying Amount | 119,263 | 116,799 |
Accumulated Amortization | (68,573) | (60,660) |
Net Carrying Amount | 50,690 | 56,139 |
Estimated aggregate amortization expense for each of five succeeding fiscal years | ||
Net Carrying Amount | $ 50,690 | $ 56,139 |
MANDATORILY REDEEMABLE PREFER_2
MANDATORILY REDEEMABLE PREFERRED SECURITIES (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
Community Capital Trust IV | |
Mandatorily Redeemable Preferred Securities | |
Redemption of debentures and associated preferred securities | $ 77.3 |
BENEFIT PLANS (Details)
BENEFIT PLANS (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Pension Plans | ||||||
Contribution made to defined benefit pension plan by employer | $ 2,800 | |||||
Pension Benefits | ||||||
Pension Plans | ||||||
Contribution made to defined benefit pension plan by employer | $ 100 | |||||
Net periodic benefit cost | ||||||
Service cost | $ 1,240 | $ 1,480 | $ 3,720 | $ 4,440 | ||
Interest cost | 1,334 | 1,259 | 4,002 | 3,777 | ||
Expected return on plan assets | (4,756) | (4,696) | (14,268) | (14,087) | ||
Amortization of unrecognized net loss | 211 | 900 | 633 | 2,700 | ||
Amortization of prior service cost | 154 | 95 | 462 | 284 | ||
Net periodic benefit | (1,817) | (962) | (5,451) | (2,886) | ||
Post-retirement Benefits | ||||||
Net periodic benefit cost | ||||||
Service cost | 0 | 0 | 0 | 0 | ||
Interest cost | 11 | 11 | 33 | 33 | ||
Expected return on plan assets | 0 | 0 | 0 | 0 | ||
Amortization of unrecognized net loss | 9 | 11 | 27 | 33 | ||
Amortization of prior service cost | (45) | (45) | (135) | (134) | ||
Net periodic benefit | $ (25) | $ (23) | $ (75) | $ (68) | ||
Steuben Trust Company Pension Plan | ||||||
Pension Plans | ||||||
Contribution made to defined benefit pension plan by employer | $ 90 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | |
EARNINGS PER SHARE | ||||||
Weighted-average anti-dilutive stock options outstanding (in shares) | 400,000 | 200,000 | 300,000 | 100,000 | ||
Basic earnings per share | ||||||
Net income | $ 48,691 | $ 45,336 | $ 135,551 | $ 146,130 | ||
Income attributable to unvested stock-based compensation awards | (142) | (110) | (386) | (340) | ||
Income available to common shareholders | $ 48,549 | $ 45,226 | $ 135,165 | $ 145,790 | ||
Weighted-average common shares outstanding - basic (in shares) | 53,830,000 | 54,025,000 | 53,915,000 | 53,960,000 | ||
Basic earnings per share | $ 0.90 | $ 0.84 | $ 2.51 | $ 2.70 | ||
Diluted earnings per share | ||||||
Net income | $ 48,691 | $ 45,336 | $ 135,551 | $ 146,130 | ||
Income attributable to unvested stock-based compensation awards | (142) | (110) | (386) | (340) | ||
Income available to common shareholders | $ 48,549 | $ 45,226 | $ 135,165 | $ 145,790 | ||
Weighted-average common shares outstanding (in shares) | 53,830,000 | 54,025,000 | 53,915,000 | 53,960,000 | ||
Assumed exercise of stock options (in shares) | 302,000 | 385,000 | 328,000 | 431,000 | ||
Weighted-average common shares outstanding - diluted (in shares) | 54,132,000 | 54,410,000 | 54,243,000 | 54,391,000 | ||
Diluted earnings per share | $ 0.90 | $ 0.83 | $ 2.49 | $ 2.68 | ||
Cash dividends declared per share (in dollars per share) | $ 0.44 | $ 0.43 | $ 1.30 | $ 1.27 | ||
Stock Repurchase Program | ||||||
Number of common shares authorized to be repurchased (in shares) | 2,700,000 | 2,680,000 | ||||
Number of common shares repurchased (in shares) | 250,000 | 0 |
COMMITMENTS, CONTINGENT LIABI_3
COMMITMENTS, CONTINGENT LIABILITIES AND RESTRICTIONS (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
COMMITMENTS, CONTINGENT LIABILITIES AND RESTRICTIONS | ||
Contract amount of commitments and contingencies | $ 1,612,916 | $ 1,486,563 |
Minimum | ||
COMMITMENTS, CONTINGENT LIABILITIES AND RESTRICTIONS | ||
Range of reasonably possible losses for such matters in the aggregate, beyond the existing recorded liability | 0 | |
Maximum | ||
COMMITMENTS, CONTINGENT LIABILITIES AND RESTRICTIONS | ||
Range of reasonably possible losses for such matters in the aggregate, beyond the existing recorded liability | 1,000 | |
Commitments to extend credit | ||
COMMITMENTS, CONTINGENT LIABILITIES AND RESTRICTIONS | ||
Contract amount of commitments and contingencies | 1,561,281 | 1,443,879 |
Standby letters of credit | ||
COMMITMENTS, CONTINGENT LIABILITIES AND RESTRICTIONS | ||
Contract amount of commitments and contingencies | $ 51,635 | $ 42,684 |
FAIR VALUE - Financial Assets a
FAIR VALUE - Financial Assets and Liabilities Accounted for at Fair Value On a Recurring Basis (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2021 | |
Available-for-sale investment securities | ||
Available-for-sale investment securities | $ 5,170,689 | $ 4,934,210 |
Equity securities | 439 | 463 |
Derivative asset | 51 | |
Transfers between Level 1 and Level 2 | 0 | |
Transfers between Level 2 and Level 1 | 0 | |
Transfers in of level 3 | 0 | |
Transfers Out of level 3 | 0 | |
U.S. Treasury and agency securities | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 4,275,440 | 3,998,564 |
Obligations of state and political subdivisions | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 489,910 | 430,289 |
Government agency mortgage-backed securities | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 384,891 | 477,056 |
Corporate debt securities | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 7,033 | 7,962 |
Government agency collateralized mortgage obligations | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 13,415 | 20,339 |
Level 3 | ||
Available-for-sale investment securities | ||
Derivative asset | (32) | |
Recurring | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 5,170,689 | 4,934,210 |
Equity securities | 439 | 463 |
Total | 5,171,111 | 4,935,049 |
Recurring | Interest rate swap agreements | ||
Available-for-sale investment securities | ||
Derivative asset | 2 | 296 |
Derivative liability | (2) | (3) |
Recurring | Forward sales commitments | ||
Available-for-sale investment securities | ||
Derivative asset | 15 | 32 |
Recurring | Commitments to originate real estate loans for sale | ||
Available-for-sale investment securities | ||
Derivative asset | (32) | 51 |
Recurring | U.S. Treasury and agency securities | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 4,275,440 | 3,998,564 |
Recurring | Obligations of state and political subdivisions | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 489,910 | 430,289 |
Recurring | Government agency mortgage-backed securities | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 384,891 | 477,056 |
Recurring | Corporate debt securities | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 7,033 | 7,962 |
Recurring | Government agency collateralized mortgage obligations | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 13,415 | 20,339 |
Recurring | Level 1 | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 4,206,653 | 3,900,924 |
Equity securities | 439 | 463 |
Total | 4,207,092 | 3,901,387 |
Recurring | Level 1 | Interest rate swap agreements | ||
Available-for-sale investment securities | ||
Derivative asset | 0 | 0 |
Derivative liability | 0 | 0 |
Recurring | Level 1 | Forward sales commitments | ||
Available-for-sale investment securities | ||
Derivative asset | 0 | 0 |
Recurring | Level 1 | Commitments to originate real estate loans for sale | ||
Available-for-sale investment securities | ||
Derivative asset | 0 | 0 |
Recurring | Level 1 | U.S. Treasury and agency securities | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 4,206,653 | 3,900,924 |
Recurring | Level 1 | Obligations of state and political subdivisions | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 0 | 0 |
Recurring | Level 1 | Government agency mortgage-backed securities | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 0 | 0 |
Recurring | Level 1 | Corporate debt securities | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 0 | 0 |
Recurring | Level 1 | Government agency collateralized mortgage obligations | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 0 | 0 |
Recurring | Level 2 | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 964,036 | 1,033,286 |
Equity securities | 0 | 0 |
Total | 964,051 | 1,033,611 |
Recurring | Level 2 | Interest rate swap agreements | ||
Available-for-sale investment securities | ||
Derivative asset | 2 | 296 |
Derivative liability | (2) | (3) |
Recurring | Level 2 | Forward sales commitments | ||
Available-for-sale investment securities | ||
Derivative asset | 15 | 32 |
Recurring | Level 2 | Commitments to originate real estate loans for sale | ||
Available-for-sale investment securities | ||
Derivative asset | 0 | 0 |
Recurring | Level 2 | U.S. Treasury and agency securities | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 68,787 | 97,640 |
Recurring | Level 2 | Obligations of state and political subdivisions | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 489,910 | 430,289 |
Recurring | Level 2 | Government agency mortgage-backed securities | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 384,891 | 477,056 |
Recurring | Level 2 | Corporate debt securities | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 7,033 | 7,962 |
Recurring | Level 2 | Government agency collateralized mortgage obligations | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 13,415 | 20,339 |
Recurring | Level 3 | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 0 | 0 |
Equity securities | 0 | 0 |
Total | (32) | 51 |
Recurring | Level 3 | Interest rate swap agreements | ||
Available-for-sale investment securities | ||
Derivative asset | 0 | 0 |
Derivative liability | 0 | 0 |
Recurring | Level 3 | Forward sales commitments | ||
Available-for-sale investment securities | ||
Derivative asset | 0 | 0 |
Recurring | Level 3 | Commitments to originate real estate loans for sale | ||
Available-for-sale investment securities | ||
Derivative asset | (32) | 51 |
Recurring | Level 3 | U.S. Treasury and agency securities | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 0 | 0 |
Recurring | Level 3 | Obligations of state and political subdivisions | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 0 | 0 |
Recurring | Level 3 | Government agency mortgage-backed securities | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 0 | 0 |
Recurring | Level 3 | Corporate debt securities | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | 0 | 0 |
Recurring | Level 3 | Government agency collateralized mortgage obligations | ||
Available-for-sale investment securities | ||
Available-for-sale investment securities | $ 0 | $ 0 |
FAIR VALUE - Assets and Liabili
FAIR VALUE - Assets and Liabilities Measured on Nonrecurring Basis (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Assets and Liabilities Measured on Nonrecurring Basis | ||
Individually assessed loans | $ 1,820 | |
Other real estate owned | 718 | |
Mortgage servicing rights | $ 1,844 | 810 |
Contingent consideration | (3,500) | (3,100) |
Valuation allowance | 0 | 566 |
Mortgage Servicing Rights. | ||
Assets and Liabilities Measured on Nonrecurring Basis | ||
Valuation allowance | 100 | 0 |
Level 3 | ||
Assets and Liabilities Measured on Nonrecurring Basis | ||
Other real estate owned | 527 | |
Non-recurring | ||
Assets and Liabilities Measured on Nonrecurring Basis | ||
Individually assessed loans | 0 | 1,820 |
Other real estate owned | 527 | 718 |
Mortgage servicing rights | 1,844 | 810 |
Contingent consideration | (3,500) | (3,100) |
Total | (1,129) | 248 |
Non-recurring | Level 1 | ||
Assets and Liabilities Measured on Nonrecurring Basis | ||
Individually assessed loans | 0 | 0 |
Other real estate owned | 0 | 0 |
Mortgage servicing rights | 0 | 0 |
Contingent consideration | 0 | 0 |
Total | 0 | 0 |
Non-recurring | Level 2 | ||
Assets and Liabilities Measured on Nonrecurring Basis | ||
Individually assessed loans | 0 | 0 |
Other real estate owned | 0 | 0 |
Mortgage servicing rights | 0 | 0 |
Contingent consideration | 0 | 0 |
Total | 0 | 0 |
Non-recurring | Level 3 | ||
Assets and Liabilities Measured on Nonrecurring Basis | ||
Individually assessed loans | 0 | 1,820 |
Other real estate owned | 527 | 718 |
Mortgage servicing rights | 1,844 | 810 |
Contingent consideration | (3,500) | (3,100) |
Total | $ (1,129) | $ 248 |
FAIR VALUE - Significant Unobse
FAIR VALUE - Significant Unobservable Inputs (Details) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 USD ($) item $ / loan | Dec. 31, 2021 USD ($) item $ / loan | |
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Individually assessed loans | $ | $ 1,820 | |
Other real estate owned | $ | 718 | |
Commitments to originate real estate loans for sale | $ | 51 | |
Mortgage servicing rights | $ | $ 1,844 | 810 |
Contingent consideration | $ | $ (3,500) | $ (3,100) |
Weighted Average Discount Rate | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Contingent consideration, Measurement Input [Extensible List] | Weighted Average Discount Rate | Weighted Average Discount Rate |
Fair Value of Collateral | Estimated Cost of Disposal/Market Adjustment | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Individually assessed loans, Valuation Technique [Extensible List] | Fair Value of Collateral | |
Individually assessed loans, Measurement Input [Extensible List] | us-gaap:MeasurementInputCostToSellMember | |
Other real estate owned, Valuation Technique [Extensible List] | Fair Value of Collateral | Fair Value of Collateral |
Other real estate owned, Measurement Input [Extensible List] | us-gaap:MeasurementInputCostToSellMember | us-gaap:MeasurementInputCostToSellMember |
Discounted Cash Flow | Embedded Servicing Value | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Commitments to originate real estate loans for sale, Valuation Technique [Extensible List] | Discounted Cash Flow | Discounted Cash Flow |
Commitments to originate real estate loans for sale, Measurement Input [Extensible List] | Embedded Servicing Value | Embedded Servicing Value |
Discounted Cash Flow | Weighted Average Constant Prepayment Rate | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Mortgage servicing rights, Valuation Technique [Extensible List] | Discounted Cash Flow | Discounted Cash Flow |
Mortgage servicing rights, Measurement Input [Extensible List] | Weighted Average Constant Prepayment Rate | Weighted Average Constant Prepayment Rate |
Discounted Cash Flow | Weighted Average Discount Rate | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Mortgage servicing rights, Measurement Input [Extensible List] | Weighted Average Discount Rate | Weighted Average Discount Rate |
Contingent consideration, Valuation Technique [Extensible List] | Discounted Cash Flow | Discounted Cash Flow |
Discounted Cash Flow | Adequate Compensation | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Mortgage servicing rights, Measurement Input [Extensible List] | Adequate Compensation | Adequate Compensation |
Discounted Cash Flow | Probability adjusted level of retained revenue | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Contingent consideration, Measurement Input [Extensible List] | Probability adjusted level of retained revenue | Probability adjusted level of retained revenue |
Minimum | Fair Value of Collateral | Estimated Cost of Disposal/Market Adjustment | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Other real estate owned, measurement input | 23.2 | |
Maximum | Fair Value of Collateral | Estimated Cost of Disposal/Market Adjustment | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Other real estate owned, measurement input | 73.5 | |
Level 3 | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Other real estate owned | $ | $ 527 | |
Commitments to originate real estate loans for sale | $ | $ (32) | |
Level 3 | Discounted Cash Flow | Embedded Servicing Value | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Commitments to originate real estate loans for sale, measurement input | 1 | 1 |
Level 3 | Discounted Cash Flow | Adequate Compensation | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Mortgage servicing rights, measurement input | $ / loan | 7 | 7 |
Level 3 | Minimum | Fair Value of Collateral | Estimated Cost of Disposal/Market Adjustment | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Individually assessed loans, measurement input | 9 | |
Other real estate owned, measurement input | 23.2 | 31.8 |
Level 3 | Minimum | Discounted Cash Flow | Weighted Average Constant Prepayment Rate | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Mortgage servicing rights, measurement input | 3.5 | 6.4 |
Level 3 | Minimum | Discounted Cash Flow | Weighted Average Discount Rate | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Mortgage servicing rights, measurement input | 4.6 | 2.3 |
Contingent consideration, measurement input | 4.4 | 1.4 |
Level 3 | Minimum | Discounted Cash Flow | Probability adjusted level of retained revenue | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Contingent consideration, measurement input 2 | $ | $ 3,300 | $ 3,000 |
Level 3 | Maximum | Fair Value of Collateral | Estimated Cost of Disposal/Market Adjustment | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Individually assessed loans, measurement input | 43.1 | |
Other real estate owned, measurement input | 73.5 | 42.3 |
Level 3 | Maximum | Discounted Cash Flow | Weighted Average Constant Prepayment Rate | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Mortgage servicing rights, measurement input | 4.1 | 15.2 |
Level 3 | Maximum | Discounted Cash Flow | Weighted Average Discount Rate | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Mortgage servicing rights, measurement input | 4.8 | 2.7 |
Contingent consideration, measurement input | 4.6 | 1.7 |
Level 3 | Maximum | Discounted Cash Flow | Probability adjusted level of retained revenue | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Contingent consideration, measurement input 2 | $ | $ 5,400 | $ 5,800 |
Level 3 | Weighted Average | Fair Value of Collateral | Estimated Cost of Disposal/Market Adjustment | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Individually assessed loans, measurement input | 43.1 | |
Other real estate owned, measurement input | 39.9 | 33.3 |
Level 3 | Weighted Average | Discounted Cash Flow | Weighted Average Constant Prepayment Rate | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Mortgage servicing rights, measurement input | 3.6 | 14 |
Level 3 | Weighted Average | Discounted Cash Flow | Weighted Average Discount Rate | ||
Significant Unobservable Inputs used in determination of Fair Value of Assets Classified as Level 3 | ||
Mortgage servicing rights, measurement input | 4.8 | 2.6 |
Contingent consideration, measurement input | 4.5 | 1.5 |
FAIR VALUE - Carrying Amounts a
FAIR VALUE - Carrying Amounts and Estimated Fair Values of Other Financial Instruments (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Carrying Value | ||
Financial assets: | ||
Net loans | $ 8,483,244 | $ 7,323,770 |
Financial liabilities: | ||
Deposits | 13,486,321 | 12,911,168 |
Overnight borrowings | 119,800 | 0 |
Securities sold under agreement to repurchase, short-term | 352,772 | 324,720 |
Other Federal Home Loan Bank borrowings | 19,472 | 1,888 |
Subordinated notes payable | 3,256 | 3,277 |
Fair Value | ||
Financial assets: | ||
Net loans | 8,192,522 | 7,523,024 |
Financial liabilities: | ||
Deposits | 13,450,034 | 12,911,197 |
Overnight borrowings | 119,800 | 0 |
Securities sold under agreement to repurchase, short-term | 352,772 | 324,720 |
Other Federal Home Loan Bank borrowings | 19,201 | 1,907 |
Subordinated notes payable | $ 3,256 | $ 3,277 |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Information about reportable segments | |||||
Net interest income | $ 110,394 | $ 92,611 | $ 308,407 | $ 278,670 | |
Provision for credit losses | 5,061 | (944) | 12,005 | (11,001) | |
Noninterest revenues | 65,249 | 64,309 | 195,019 | 182,300 | |
Amortization of intangible assets | 3,837 | 3,703 | 11,420 | 10,300 | |
Acquisition expenses | 409 | 102 | 4,668 | 133 | |
Acquisition-related contingent consideration adjustment | 0 | 0 | 400 | 0 | |
Other operating expenses | 103,939 | 96,631 | 301,928 | 276,792 | |
Income before income taxes | 62,397 | 57,428 | 173,005 | 184,746 | |
Assets | 15,594,547 | 15,331,098 | 15,594,547 | 15,331,098 | $ 15,552,657 |
Goodwill | 844,984 | 799,127 | 844,984 | 799,127 | $ 799,109 |
Core deposit intangibles & Other intangibles | 64,240 | 68,977 | 64,240 | 68,977 | |
Eliminations | |||||
Information about reportable segments | |||||
Net interest income | 0 | 0 | 0 | 0 | |
Provision for credit losses | 0 | 0 | 0 | 0 | |
Noninterest revenues | (1,839) | (1,745) | (5,773) | (5,341) | |
Amortization of intangible assets | 0 | 0 | 0 | 0 | |
Acquisition expenses | 0 | 0 | 0 | 0 | |
Acquisition-related contingent consideration adjustment | 0 | ||||
Other operating expenses | (1,839) | (1,745) | (5,773) | (5,341) | |
Income before income taxes | 0 | 0 | 0 | 0 | |
Assets | (132,141) | (116,733) | (132,141) | (116,733) | |
Goodwill | 0 | 0 | 0 | 0 | |
Core deposit intangibles & Other intangibles | 0 | 0 | 0 | 0 | |
Banking | Operating Segments | |||||
Information about reportable segments | |||||
Net interest income | 110,311 | 92,539 | 308,177 | 278,411 | |
Provision for credit losses | 5,061 | (944) | 12,005 | (11,001) | |
Noninterest revenues | 19,427 | 17,696 | 55,634 | 50,507 | |
Amortization of intangible assets | 1,266 | 1,102 | 3,506 | 3,666 | |
Acquisition expenses | 409 | 102 | 4,665 | 133 | |
Acquisition-related contingent consideration adjustment | 0 | ||||
Other operating expenses | 73,554 | 67,980 | 212,616 | 198,145 | |
Income before income taxes | 49,448 | 41,995 | 131,019 | 137,975 | |
Assets | 15,373,021 | 15,102,077 | 15,373,021 | 15,102,077 | |
Goodwill | 735,680 | 689,868 | 735,680 | 689,868 | |
Core deposit intangibles & Other intangibles | 13,550 | 10,165 | 13,550 | 10,165 | |
Employee Benefit Services | Operating Segments | |||||
Information about reportable segments | |||||
Net interest income | 75 | 65 | 210 | 224 | |
Provision for credit losses | 0 | 0 | 0 | 0 | |
Noninterest revenues | 28,451 | 30,473 | 88,093 | 85,616 | |
Amortization of intangible assets | 1,633 | 1,675 | 4,974 | 4,356 | |
Acquisition expenses | 0 | 0 | 3 | 0 | |
Acquisition-related contingent consideration adjustment | (100) | ||||
Other operating expenses | 17,711 | 17,212 | 53,026 | 47,063 | |
Income before income taxes | 9,182 | 11,651 | 30,400 | 34,421 | |
Assets | 250,784 | 246,033 | 250,784 | 246,033 | |
Goodwill | 85,381 | 85,336 | 85,381 | 85,336 | |
Core deposit intangibles & Other intangibles | 35,045 | 41,695 | 35,045 | 41,695 | |
All Other | Operating Segments | |||||
Information about reportable segments | |||||
Net interest income | 8 | 7 | 20 | 35 | |
Provision for credit losses | 0 | 0 | 0 | 0 | |
Noninterest revenues | 19,210 | 17,885 | 57,065 | 51,518 | |
Amortization of intangible assets | 938 | 926 | 2,940 | 2,278 | |
Acquisition expenses | 0 | 0 | 0 | 0 | |
Acquisition-related contingent consideration adjustment | 500 | ||||
Other operating expenses | 14,513 | 13,184 | 42,059 | 36,925 | |
Income before income taxes | 3,767 | 3,782 | 11,586 | 12,350 | |
Assets | 102,883 | 99,721 | 102,883 | 99,721 | |
Goodwill | 23,923 | 23,923 | 23,923 | 23,923 | |
Core deposit intangibles & Other intangibles | $ 15,645 | $ 17,117 | $ 15,645 | $ 17,117 |