Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2017 | Jul. 31, 2017 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | ORRSTOWN FINANCIAL SERVICES INC | |
Entity Central Index Key | 826,154 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q2 | |
Trading Symbol | ORRF | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 8,343,018 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Assets | ||
Cash and due from banks | $ 19,754 | $ 16,072 |
Interest-bearing deposits with banks | 18,258 | 14,201 |
Cash and cash equivalents | 38,012 | 30,273 |
Restricted investments in bank stocks | 7,072 | 7,970 |
Securities available for sale | 401,904 | 400,154 |
Loans held for sale | 5,182 | 2,768 |
Loans | 934,382 | 883,391 |
Less: Allowance for loan losses | (12,751) | (12,775) |
Net loans | 921,631 | 870,616 |
Premises and equipment, net | 35,036 | 34,871 |
Cash surrender value of life insurance | 32,523 | 32,102 |
Accrued interest receivable | 4,467 | 4,672 |
Other assets | 29,103 | 31,078 |
Total assets | 1,474,930 | 1,414,504 |
Deposits: | ||
Noninterest-bearing | 157,703 | 150,747 |
Interest-bearing | 1,038,233 | 1,001,705 |
Total deposits | 1,195,936 | 1,152,452 |
Short-term borrowings | 90,562 | 87,864 |
Long-term debt | 23,991 | 24,163 |
Accrued interest and other liabilities | 21,178 | 15,166 |
Total liabilities | 1,331,667 | 1,279,645 |
Shareholders’ Equity | ||
Preferred stock, $1.25 par value per share; 500,000 shares authorized; no shares issued or outstanding | 0 | 0 |
Common stock, no par value—$0.05205 stated value per share 50,000,000 shares authorized; 8,348,243 and 8,343,435 shares issued; 8,343,908 and 8,285,733 shares outstanding | 435 | 437 |
Additional paid - in capital | 124,727 | 124,935 |
Retained earnings | 15,324 | 11,669 |
Accumulated other comprehensive income (loss) | 2,857 | (1,165) |
Treasury stock—common, 4,335 and 57,702 shares, at cost | (80) | (1,017) |
Total shareholders’ equity | 143,263 | 134,859 |
Total liabilities and shareholders’ equity | $ 1,474,930 | $ 1,414,504 |
Consolidated Balance Sheets (U3
Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Jun. 30, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (usd per share) | $ 1.25 | $ 1.25 |
Preferred stock, shares authorized | 500,000 | 500,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, stated value (usd per share) | $ 0.05205 | $ 0.05205 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 8,348,243 | 8,343,435 |
Common stock, shares outstanding | 8,343,908 | 8,285,733 |
Treasury stock shares | 4,335 | 57,702 |
Consolidated Statements of Inco
Consolidated Statements of Income (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Interest and dividend income | ||||
Interest and fees on loans | $ 9,851,000 | $ 8,384,000 | $ 19,055,000 | $ 16,375,000 |
Interest and dividends on investment securities: | ||||
Taxable | 1,766,000 | 1,368,000 | 3,593,000 | 2,832,000 |
Tax-exempt | 805,000 | 441,000 | 1,586,000 | 882,000 |
Short-term investments | 46,000 | 79,000 | 64,000 | 144,000 |
Total interest and dividend income | 12,468,000 | 10,272,000 | 24,298,000 | 20,233,000 |
Interest expense | ||||
Interest on deposits | 1,484,000 | 1,191,000 | 2,810,000 | 2,330,000 |
Interest on short-term borrowings | 189,000 | 25,000 | 361,000 | 91,000 |
Interest on long-term debt | 77,000 | 105,000 | 172,000 | 211,000 |
Total interest expense | 1,750,000 | 1,321,000 | 3,343,000 | 2,632,000 |
Net interest income | 10,718,000 | 8,951,000 | 20,955,000 | 17,601,000 |
Provision for loan losses | 100,000 | 0 | 100,000 | 0 |
Net interest income after provision for loan losses | 10,618,000 | 8,951,000 | 20,855,000 | 17,601,000 |
Noninterest income | ||||
Service charges on deposit accounts | 1,429,000 | 1,372,000 | 2,787,000 | 2,675,000 |
Other service charges, commissions and fees | 283,000 | 289,000 | 492,000 | 449,000 |
Trust and investment management income | 1,623,000 | 1,188,000 | 3,069,000 | 2,524,000 |
Brokerage income | 518,000 | 577,000 | 985,000 | 1,026,000 |
Mortgage banking activities | 813,000 | 727,000 | 1,316,000 | 1,369,000 |
Earnings on life insurance | 271,000 | 270,000 | 539,000 | 538,000 |
Other income | 32,000 | 114,000 | 113,000 | 201,000 |
Investment securities gains | 654,000 | 0 | 657,000 | 1,420,000 |
Total noninterest income | 5,623,000 | 4,537,000 | 9,958,000 | 10,202,000 |
Noninterest expenses | ||||
Salaries and employee benefits | 7,422,000 | 6,312,000 | 14,822,000 | 12,495,000 |
Occupancy expense | 705,000 | 592,000 | 1,462,000 | 1,118,000 |
Furniture and equipment | 826,000 | 748,000 | 1,562,000 | 1,534,000 |
Data processing | 664,000 | 519,000 | 1,175,000 | 1,154,000 |
Telephone and communication | 193,000 | 190,000 | 315,000 | 366,000 |
Automated teller and interchange fees | 194,000 | 237,000 | 372,000 | 398,000 |
Advertising and bank promotions | 391,000 | 355,000 | 778,000 | 811,000 |
FDIC insurance | 178,000 | 223,000 | 315,000 | 455,000 |
Legal fees | 108,000 | 225,000 | 261,000 | 406,000 |
Other professional services | 377,000 | 345,000 | 732,000 | 684,000 |
Directors' compensation | 249,000 | 257,000 | 491,000 | 488,000 |
Collection and problem loan | 3,000 | 96,000 | 78,000 | 148,000 |
Real estate owned | (12,000) | 58,000 | 8,000 | 101,000 |
Taxes other than income | 220,000 | 253,000 | 448,000 | 408,000 |
Regulatory settlement | 0 | 1,000,000 | 0 | 1,000,000 |
Other operating expenses | 899,000 | 1,148,000 | 1,744,000 | 2,113,000 |
Total noninterest expenses | 12,417,000 | 12,558,000 | 24,563,000 | 23,679,000 |
Income before income tax expense | 3,824,000 | 930,000 | 6,250,000 | 4,124,000 |
Income tax expense | 516,000 | 252,000 | 940,000 | 866,000 |
Net income | $ 3,308,000 | $ 678,000 | $ 5,310,000 | $ 3,258,000 |
Per share information: | ||||
Basic earnings per share (usd per share) | $ 0.41 | $ 0.08 | $ 0.66 | $ 0.40 |
Diluted earnings per share (usd per share) | 0.40 | 0.08 | 0.65 | 0.40 |
Dividends per share (usd per share) | $ 0.10 | $ 0.09 | $ 0.2 | $ 0.17 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 3,308 | $ 678 | $ 5,310 | $ 3,258 |
Other comprehensive income, net of tax: | ||||
Unrealized gains on securities available for sale arising during the period | 5,130 | 4,596 | 6,750 | 10,992 |
Reclassification adjustment for gains realized in net income | (654) | 0 | (657) | (1,420) |
Net unrealized gains | 4,476 | 4,596 | 6,093 | 9,572 |
Tax effect | (1,521) | (1,609) | (2,071) | (3,350) |
Total other comprehensive income, net of tax and reclassification adjustments | 2,955 | 2,987 | 4,022 | 6,222 |
Total comprehensive income | $ 6,263 | $ 3,665 | $ 9,332 | $ 9,480 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders’ Equity (Unaudited) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Treasury Stock |
Beginning balance at Dec. 31, 2015 | $ 133,061 | $ 435 | $ 124,317 | $ 7,939 | $ 1,199 | $ (829) |
Increase (Decrease) in Shareholders' Equity | ||||||
Net income | 3,258 | 0 | 0 | 3,258 | 0 | 0 |
Total other comprehensive income, net of taxes | 6,222 | 0 | 0 | 0 | 6,222 | 0 |
Cash dividends ($0.20 and $0.17 per share in 2017 and 2016) | (1,410) | 0 | 0 | (1,410) | 0 | 0 |
Share-based compensation plans: | ||||||
Issuance of stock, including compensation expense | 539 | 2 | 490 | 0 | 0 | 47 |
Acquisition of treasury stock (35,648 shares in 2016) | (631) | 0 | 0 | 0 | 0 | (631) |
Ending balance at Jun. 30, 2016 | 141,039 | 437 | 124,807 | 9,787 | 7,421 | (1,413) |
Beginning balance at Dec. 31, 2016 | 134,859 | 437 | 124,935 | 11,669 | (1,165) | (1,017) |
Increase (Decrease) in Shareholders' Equity | ||||||
Net income | 5,310 | 0 | 0 | 5,310 | 0 | 0 |
Total other comprehensive income, net of taxes | 4,022 | 0 | 0 | 0 | 4,022 | 0 |
Cash dividends ($0.20 and $0.17 per share in 2017 and 2016) | (1,655) | 0 | 0 | (1,655) | 0 | 0 |
Share-based compensation plans: | ||||||
Issuance of stock, including compensation expense | 727 | (2) | (208) | 0 | 0 | 937 |
Ending balance at Jun. 30, 2017 | $ 143,263 | $ 435 | $ 124,727 | $ 15,324 | $ 2,857 | $ (80) |
Consolidated Statements of Cha7
Consolidated Statements of Changes in Shareholders’ Equity (Unaudited) (Parenthetical) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Statement of Stockholders' Equity [Abstract] | ||
Cash dividends per share (usd per share) | $ 0.20 | $ 0.17 |
Stock-based compensation plans, issuance of stock, shares | 4,808 | 37,462 |
Compensation expense, issuance of stock | $ 666 | $ 499 |
Issuance of treasury stock, shares | 53,367 | 2,461 |
Acquisition of treasury stock, shares | 35,648 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Cash flows from operating activities | ||
Net income | $ 5,310 | $ 3,258 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Amortization of premiums on securities available for sale | 2,477 | 2,577 |
Depreciation and amortization | 1,539 | 1,458 |
Provision for loan losses | 100 | 0 |
Share-based compensation | 666 | 499 |
Gain on sales of loans originated for sale | (1,064) | (1,164) |
Mortgage loans originated for sale | (44,710) | (44,052) |
Proceeds from sales of loans originated for sale | 43,011 | 44,237 |
Net gain on disposal of OREO | (10) | (92) |
Writedown of OREO | 4 | 95 |
Net (gain) loss on disposal of premises and equipment | (18) | 46 |
Deferred income taxes | 745 | 743 |
Investment securities gains | (657) | (1,420) |
Earnings on cash surrender value of life insurance | (539) | (538) |
Decrease in accrued interest receivable | 205 | 86 |
Increase in accrued interest payable and other liabilities | 589 | 684 |
Other, net | (95) | (1,045) |
Net cash provided by operating activities | 7,553 | 5,372 |
Cash flows from investing activities | ||
Proceeds from sales of available for sale securities | 58,653 | 64,743 |
Maturities, repayments and calls of available for sale securities | 13,824 | 13,258 |
Purchases of available for sale securities | (64,531) | 0 |
Net redemptions of restricted investments in bank stocks | 898 | 2,940 |
Net increase in loans | (51,835) | (50,762) |
Purchases of bank premises and equipment | (1,498) | (8,585) |
Improvements to OREO | (9) | (39) |
Proceeds from disposal of OREO | 185 | 508 |
Proceeds from disposal of bank premises and equipment | 83 | 0 |
Net cash provided by (used in) investing activities | (44,230) | 22,063 |
Cash flows from financing activities | ||
Net increase in deposits | 43,484 | 55,802 |
Net increase (decrease) in short-term borrowings | 2,698 | (45,763) |
Payments on long-term debt | (172) | (164) |
Dividends paid | (1,655) | (1,410) |
Acquisition of treasury stock | 0 | (631) |
Issuance of treasury stock | 61 | 40 |
Net cash provided by financing activities | 44,416 | 7,874 |
Net increase in cash and cash equivalents | 7,739 | 35,309 |
Cash and cash equivalents at beginning of period | 30,273 | 28,340 |
Cash and cash equivalents at end of period | 38,012 | 63,649 |
Supplemental disclosures of cash flow information: | ||
Interest | 3,332 | 2,620 |
Income taxes | 150 | 450 |
Supplemental schedule of noncash investing activities: | ||
OREO acquired in settlement of loans | 720 | 414 |
Security purchases not yet settled | $ 5,423 | $ 0 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES See the Glossary of Defined Terms at the beginning of this Report for terms used throughout the consolidated financial statements and related notes of this Form 10-Q. Nature of Operations – Orrstown Financial Services, Inc. and subsidiaries is a financial holding company that operates Orrstown Bank, a commercial bank with branches in Berks, Cumberland, Dauphin, Franklin, Lancaster, and Perry Counties of Pennsylvania and in Washington County, Maryland and Wheatland Advisors, Inc., a registered investment advisor non-bank subsidiary, headquartered in Lancaster, Pennsylvania, and which was acquired in December 2016. The Bank engages in lending activities including commercial, residential, commercial mortgages, construction, municipal, and various forms of consumer lending. Deposit services include checking, savings, time, and money market deposits. The Bank also provides investment and brokerage services through its OFA division. The Company and the Bank are subject to regulation by certain federal and state agencies and undergo periodic examinations by such regulatory authorities. Basis of Presentation – The accompanying condensed consolidated financial statements include the accounts of Orrstown Financial Services, Inc. and its wholly owned subsidiaries, the Bank and Wheatland. The Company has prepared these unaudited condensed consolidated financial statements in accordance with GAAP for interim financial information, SEC rules that permit reduced disclosure for interim periods, and Article 10 of Regulation S-X. In the opinion of management, all adjustments (all of which are of a normal recurring nature) that are necessary for a fair statement are reflected in the unaudited condensed consolidated financial statements. The December 31, 2016 consolidated balance sheet information contained in this Quarterly Report on Form 10-Q was derived from the 2016 audited consolidated financial statements. The unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements, including the notes thereto, included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016. Operating results for the three and six months ended June 30, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017 . All significant intercompany transactions and accounts have been eliminated. Certain reclassifications have been made to prior year amounts to conform with current year classifications. The Company's management has evaluated all activity of the Company and concluded that subsequent events are properly reflected in the Company's consolidated financial statements and notes as required by GAAP. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change include the determination of the ALL and income taxes. Concentration of Credit Risk – The Company grants commercial, residential, construction, and municipal loans, and various forms of consumer loans to customers primarily in its market area of Berks, Cumberland, Dauphin, Franklin, Lancaster, and Perry Counties of Pennsylvania and in Washington County, Maryland. The Company's exposure to credit risk is significantly affected by changes in the economy in those areas. Although the Company maintains a diversified loan portfolio, a significant portion of its customers’ ability to honor their contracts is dependent upon economic sectors for commercial real estate, including office space, retail strip centers, multi-family and hospitality, residential building operators, sales finance, sub-dividers and developers. Management evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if collateral is deemed necessary by the Company upon the extension of credit, is based on management’s credit evaluation of the customer. Collateral held varies, but generally includes real estate and equipment. The types of securities the Company invests in are included in Note 2, Securities Available for Sale and the type of lending the Company engages in are included in Note 3, Loans and Allowance for Loan Losses. Cash and Cash Equivalents – Cash and cash equivalents include cash, balances due from banks, federal funds sold and interest-bearing deposits due on demand, all of which have original maturities of 90 days or less. Net cash flows are reported for customer loan and deposit transactions, redemptions (purchases) of restricted investments in bank stocks, and short-term borrowings. Restricted Investments in Bank Stocks – Restricted investments in bank stocks consist of Federal Reserve Bank of Philadelphia stock, FHLB of Pittsburgh stock and Atlantic Community Bankers Bank stock. Federal law requires a member institution of the district Federal Reserve Bank and FHLB to hold stock according to predetermined formulas. Atlantic Community Bankers Bank requires its correspondent banking institutions to hold stock as a condition of membership. The restricted investment in bank stocks is carried at cost. Quarterly, management evaluates the bank stocks for impairment based on an assessment of the ultimate recoverability of cost rather than by recognizing temporary declines in value. The determination of whether a decline affects the ultimate recoverability of cost is influenced by criteria such as operating performance, liquidity, funding and capital positions, stock repurchase history, dividend history and impact of legislative and regulatory changes. Securities – The Company classifies debt and marketable equity securities as available for sale on the date of purchase. At June 30, 2017 and December 31, 2016 , the Company had no held to maturity or trading securities. AFS securities are reported at fair value. Interest income and dividends are recognized in interest income on an accrual basis. Purchase premiums and discounts on debt securities are amortized to interest income using the interest method over the terms of the securities and approximate the level yield method. Changes in unrealized gains and losses, net of related deferred taxes, for AFS securities are recorded in AOCI. Realized gains and losses on securities are recorded on the trade date using the specific identification method and are included in noninterest income. AFS securities include investments that management intends to use as part of its asset/liability management strategy. Securities may be sold in response to changes in interest rates, changes in prepayment rates and other factors. The Company does not have the intent to sell any of its AFS securities that are in an unrealized loss position and it is more likely than not that the Company will not be required to sell these securities before recovery of their amortized cost. Management evaluates securities for OTTI on at least a quarterly basis, and more frequently when economic or market conditions warrant such an evaluation. For securities in an unrealized loss position, management considers the extent and duration of the unrealized loss, and the financial condition and near-term prospects of the issuer. Management also assesses whether it intends to sell, or it is more likely than not that it will be required to sell, a security in an unrealized loss position before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the entire difference between amortized cost and fair value is recognized as impairment through earnings. For debt securities that do not meet the aforementioned criteria, the amount of impairment is split into two components: OTTI related to other factors, which is recognized in OCI and the remaining OTTI recognized in earnings. The credit loss is defined as the difference between the present value of the cash flows expected to be collected and the amortized cost basis. For equity securities, the entire amount of impairment is recognized through earnings. The Company’s securities are exposed to various risks, such as interest rate risk, market risk, and credit risk. Due to the level of risk associated with certain investments and the level of uncertainty related to changes in the value of investments, it is at least reasonably possible that changes in risks in the near term would materially affect investment assets reported in the consolidated financial statements. Loans Held for Sale – Loans originated and intended for sale in the secondary market are carried at the lower of aggregate cost or fair value. Gains and losses on loan sales (sales proceeds minus carrying value) are recorded in noninterest income. Loans – The Company grants commercial loans; residential, commercial and construction mortgage loans; and various forms of consumer loans to its customers located principally in south central Pennsylvania and northern Maryland. The ability of the Company’s debtors to honor their contracts is dependent largely upon the real estate and general economic conditions in this area. Loans that management has the intent and ability to hold for the foreseeable future or until maturity or pay-off generally are reported at their outstanding unpaid principal balances adjusted for charge-offs, the ALL, and any deferred fees or costs on originated loans. Interest income is accrued on the unpaid principal balance. Loan origination fees, net of certain direct origination costs, are deferred and amortized as a yield adjustment over the respective term of the loan. For all classes of loans, the accrual of interest income on loans, including impaired loans, ceases when principal or interest is past due 90 days or more or immediately if, in the opinion of management, full collection is unlikely. Interest will continue to accrue on loans past due 90 days or more if the collateral is adequate to cover principal and interest, and the loan is in the process of collection. Interest accrued, but not collected, at the date of placement on nonaccrual status, is reversed and charged against current interest income, unless fully collateralized. Subsequent payments received are either applied to the outstanding principal balance or recorded as interest income, depending upon management’s assessment of the ultimate collectability of principal. Loans are returned to accrual status, for all loan classes, when all the principal and interest amounts contractually due are brought current, the loan has performed in accordance with the contractual terms of the note for a reasonable period of time, generally six months , and the ultimate collectability of the total contractual principal and interest is reasonably assured. Past due status is based on contractual terms of the loan. Loans, the terms of which are modified, are classified as TDRs if a concession was granted in connection with the modification, for legal or economic reasons, related to the debtor’s financial difficulties. Concessions granted under a TDR typically involve a temporary deferral of scheduled loan payments, an extension of a loan’s stated maturity date, a temporary reduction in interest rates, or granting of an interest rate below market rates given the risk of the transaction. If a modification occurs while the loan is on accruing status, it will continue to accrue interest under the modified terms. Nonaccrual TDRs may be restored to accrual status if scheduled principal and interest payments, under the modified terms, are current for six months after modification, and the borrower continues to demonstrate its ability to meet the modified terms. TDRs are evaluated individually for impairment on a quarterly basis including monitoring of performance according to their modified terms. Allowance for Loan Losses – The ALL is evaluated on a quarterly basis, as losses are estimated to be probable and incurred, and, if deemed necessary, is increased through a provision for loan losses charged to earnings. Loan losses are charged against the ALL when management determines that all or a portion of the loan is uncollectible. Recoveries on previously charged-off loans are credited to the ALL when received. The ALL is allocated to loan portfolio classes on a quarterly basis, but the entire balance is available to cover losses from any of the portfolio classes when those losses are confirmed. Management uses internal policies and bank regulatory guidance in periodically evaluating loans for collectability and incorporates historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. See Note 3, Loans and Allowance for Loan Losses, for additional details. Loan Commitments and Related Financial Instruments – Financial instruments include off-balance sheet credit instruments, such as commitments to make loans and commercial letters of credit, issued to meet customer financing needs. The face amount for these items represents the exposure to loss, before considering customer collateral or ability to repay. These financial instruments are recorded when they are funded. The Company maintains a reserve for probable losses on off-balance sheet commitments which is included in Other Liabilities. Loans Serviced – The Bank administers secondary market mortgage programs available through the FHLB and the Federal National Mortgage Association and offers residential mortgage products and services to customers. The Bank originates single-family residential mortgage loans for immediate sale in the secondary market, and retains the servicing of those loans sold to these investors. At June 30, 2017 and December 31, 2016 , the balance of loans serviced for others totaled $328,534,000 and $328,701,000 . Transfers of Financial Assets – Transfers of financial assets are accounted for as sales when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when (1) the assets have been isolated from the Company, (2) the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets, and (3) the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity. Cash Surrender Value of Life Insurance – The Company has purchased life insurance policies on certain employees. Life insurance is recorded at the cash surrender value adjusted for other charges or other amounts due that are probable at settlement. Premises and Equipment – Buildings, improvements, equipment, furniture and fixtures are carried at cost less accumulated depreciation and amortization. Land is carried at cost. Depreciation and amortization has been provided generally on the straight-line method and is computed over the estimated useful lives of the various assets as follows: buildings and improvements, including leasehold improvements – 10 to 40 years; and furniture and equipment – 3 to 15 years. Leasehold improvements are amortized over the shorter of the lease term or the indicated life. Repairs and maintenance are charged to operations as incurred, while major additions and improvements are capitalized. Gain or loss on retirement or disposal of individual assets is recorded as income or expense in the period of retirement or disposal. Goodwill and Other Intangible Assets – Goodwill is calculated as the purchase premium, if any, after adjusting for the fair value of net assets acquired in purchase transactions. Goodwill is not amortized but is reviewed for potential impairment on at least an annual basis, with testing between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit. Other intangible assets represent purchased assets that can be distinguished from goodwill because of contractual or other legal rights. The Company’s other intangible assets have finite lives and are amortized on either the sum of the years digits or straight line bases over their estimated lives, generally 10 years for deposit premiums and 10 to 15 years for customer lists. Mortgage Servicing Rights – The estimated fair value of MSRs related to loans sold and serviced by the Company is recorded as an asset upon the sale of such loans. MSRs are amortized as a reduction to servicing income over the estimated lives of the underlying loans. MSRs are evaluated periodically for impairment by comparing the carrying amount to estimated fair value. Fair value is determined periodically through a discounted cash flows valuation performed by a third party. Significant inputs to the valuation include expected servicing income, net of expense, the discount rate and the expected life of the underlying loans. To the extent the amortized cost of the MSRs exceeds their estimated fair values, a valuation allowance is established for such impairment through a charge against servicing income on the consolidated statements of income. If the Company determines, based on subsequent valuations, that the impairment no longer exists or is reduced, the valuation allowance is reduced through a credit to earnings. MSRs totaled $2,848,000 and $2,835,000 at June 30, 2017 and December 31, 2016 , and are included in Other Assets. Foreclosed Real Estate – Real estate property acquired through foreclosure or other means is initially recorded at the fair value of the related real estate collateral at the transfer date less estimated selling costs, and subsequently at the lower of its carrying value or fair value less estimated costs to sell. Fair value is usually determined based upon an independent third-party appraisal of the property or occasionally upon a recent sales offer. Costs to maintain foreclosed real estate are expensed as incurred. Costs that significantly improve the value of the properties are capitalized. Foreclosed real estate totaled $1,012,000 and $346,000 as of June 30, 2017 and December 31, 2016 and is included in Other Assets. Investments in Real Estate Partnerships – The Company has a 99% limited partner interest in several real estate partnerships in central Pennsylvania. These investments are affordable housing projects which entitle the Company to tax deductions and credits through 2025. The Company accounts for its investments in affordable housing projects under the proportional amortization method when the criteria are met, which is limited to one investment entered into in 2015, with the other investments accounted for under the equity method of accounting. The recorded investment in these real estate partnerships, included in Other Assets, totaled $4,689,000 and $4,909,000 at June 30, 2017 and December 31, 2016 , of which $1,888,000 and $1,993,000 are accounted for under the proportional amortization method. Losses accounted for under the equity method for investments in real estate partnerships totaled $26,000 and $89,000 for the three months ended June 30, 2017 and 2016 , and $115,000 and $178,000 for the six months ended June 30, 2017 and 2016 , and are included in other noninterest income. Losses on investments accounted for under the proportional amortization method are included in income tax expense, net of federal income tax benefit. These losses totaled $52,000 and $53,000 for the three months ended June 30, 2017 and 2016 , and $105,000 and $86,000 for the six months ended June 30, 2017 and 2016 . The Company recognized federal tax credits from these investments totaling $252,000 and $184,000 during the three months ended June 30, 2017 and 2016 , and $505,000 , and $368,000 during the six months ended June 30, 2017 and 2016 , which are included in income tax expense. Advertising – The Company expenses advertising as incurred. Advertising expense totaled $214,000 and $202,000 for the three months ended June 30, 2017 and 2016 , and $317,000 and $353,000 for the six months ended June 30, 2017 and 2016 . Repurchase Agreements – The Company enters into agreements under which it sells securities subject to an obligation to repurchase the same or similar securities which are included in short-term borrowings. Under these agreements, the Company may transfer legal control over the assets but still retain effective control through an agreement that both entitles and obligates the Company to repurchase the assets. As a result, these Repurchase Agreements are accounted for as collateralized financing arrangements (i.e., secured borrowings) and not as a sale and subsequent repurchase of securities. The obligation to repurchase the securities is reflected as a liability in the Company’s consolidated balance sheets, while the securities underlying the Repurchase Agreements remaining are reflected in AFS securities; the repurchase obligation and underlying securities are not offset or netted. The Company does not enter into reverse Repurchase Agreements, so there is no offsetting to be done with Repurchase Agreements. The right of setoff for a Repurchase Agreement resembles a secured borrowing, whereby the collateral would be used to settle the fair value of the Repurchase Agreement should the Company be in default (e.g., fails to make an interest payment to the counterparty). For the Repurchase Agreements, the collateral is held by the Company in a segregated custodial account under a third party agreement. Repurchase agreements are secured by GSE MBSs and mature overnight. Share Compensation Plans – The Company has share compensation plans that cover employees and non-employee directors. Compensation expense relating to share-based payment transactions is measured based on the grant date fair value of the share award, including a Black-Scholes model for stock options. Compensation expense for all share awards is calculated and recognized over the employees’ service period, generally defined as the vesting period. Income Taxes – Income tax accounting guidance results in two components of income tax expense: current and deferred. Current income tax expense reflects taxes to be paid or refunded for the current period by applying the provisions of the enacted tax law to the taxable income or excess of deductions over revenues. The Company determines deferred income taxes using the liability (or balance sheet) method. Under this method, the net deferred tax asset or liability is based on the tax effects of the differences between the book and tax bases of assets and liabilities, and enacted changes in tax rates and laws are recognized in the period in which they occur. Deferred income tax expense results from changes in deferred tax assets and liabilities between periods. Deferred tax assets are recognized if it is more likely than not, based on the technical merits, that the tax position will be realized or sustained upon examination. The term more likely than not means a likelihood of more than 50 percent; the terms examined and upon examination also include resolution of the related appeals or litigation processes, if any. A tax position that meets the more-likely-than-not recognition threshold is initially and subsequently measured as the largest amount of tax benefit that has a greater than 50 percent likelihood of being realized upon settlement with a taxing authority that has full knowledge of all relevant information. The determination of whether or not a tax position has met the more-likely-than-not recognition threshold considers the facts, circumstances, and information available at the reporting date and is subject to management’s judgment. Deferred tax assets are reduced by a valuation allowance if, based on the weight of evidence available, it is more likely than not that some portion or all of a deferred tax asset will not be realized. The Company recognizes interest and penalties, if any, on income taxes as a component of income tax expense. Loss Contingencies – Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated. Treasury Stock – Common stock shares repurchased are recorded as treasury stock at cost. Earnings Per Share – Basic earnings per share represents income available to common stockholders divided by the weighted average number of common shares outstanding during the period. Restricted stock awards are included in weighted average common shares outstanding as they are earned. Diluted earnings per share includes additional common shares that would have been outstanding if dilutive potential common shares had been issued. Potential common shares that may be issued by the Company relate solely to outstanding stock options and restricted stock awards and are determined using the treasury stock method. Treasury shares are not deemed outstanding for earnings per share calculations. Comprehensive Income – Comprehensive income consists of net income and OCI. OCI is limited to unrealized gains (losses) on AFS securities for all periods presented. Unrealized gains (losses) on AFS securities, net of tax, was the sole component of AOCI at June 30, 2017 and December 31, 2016 . Fair Value – Fair values of financial instruments are estimated using relevant market information and other assumptions, as more fully disclosed in Note 9, Fair Value. Fair value estimates involve uncertainties and matters of significant judgment. Changes in assumptions or in market conditions could significantly affect the estimates. Segment Reporting – The Company operates in one significant segment – Community Banking. The Company’s non-banking activities are insignificant to the consolidated financial statements. Recent Accounting Pronouncements - In May 2014, the FASB issued ASU 2014-9, Revenue from Contracts with Customers (Topic 606) . ASU 2014-9, as amended, creates a new Topic 606 to provide guidance on revenue recognition for entities that enter into contracts with customers to transfer goods or services or enter into contracts for the transfer of nonfinancial assets. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Additional disclosures are required to provide quantitative and qualitative information regarding the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. These changes become effective for the Company on January 1, 2018. Because the guidance does not apply to revenue associated with financial instruments, including loans and securities, the new guidance is not expected to have a material impact on the components of the Consolidated Statements of Income most closely associated with financial instruments, including interest income and securities gains/losses. The Company is currently in the process of quantifying the potential impact of changes to the presentation and timing of certain items within noninterest income, and the related changes to disclosures that may be required. Management does not anticipate this update will have a material impact on the Company's financial position or results of operations. In January 2016, the FASB issued ASU 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. ASU 2016-01 provides updated accounting and reporting requirements for both public and non-public entities. The most significant provisions that will impact the Company are: AFS equity securities will be measured at fair value, with the changes in fair value recognized in the income statement; the elimination of the requirement to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments at amortized cost on the balance sheet; a provision to require the utilization of the exit price notion when measuring the fair value of financial instruments for disclosure purposes; and a requirement for separate presentation of both financial assets and liabilities by measurement category and form of financial asset on the balance sheet or accompanying notes to the financial statements. These changes become effective for the Company on January 1, 2018, using a cumulative-effect adjustment to the balance sheet. Management does not anticipate this update will have a material impact on the Company's financial position or results of operations. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) . ASU 2016-12 provides updated accounting and reporting requirements, which, among other things, require lessees to recognize the following for all leases (with the exception of short-term leases) at the commencement date: a lease liability, which is a lessee's obligation to make lease payments arising from a lease, measured on a discounted basis, and a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. These changes become effective for the Company on January 1, 2019. Earlier application is permitted. Lessees must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The modified retrospective approach would not require any transition accounting for leases that expired before the earliest comparative period presented. The Company anticipates that the impact on its balance sheet will result in an increase in assets and liabilities for its right of use assets and related lease liabilities for those leases that are outstanding at the date of adoption, however, it does not anticipate it will have a material impact on its results of operations. Management is evaluating other effects of this standard on the Company's financial position and regulatory capital. In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation: Improvements to Employee Share-Based Payment Accounting (Topic 718). ASU 2016-09 requires recognition of the income tax effects of share-based awards in the income statement when the awards vest or are settled, eliminating additional paid-in capital pools. The adoption of these changes by the Company on January 1, 2017 did not have a material impact on its financial position or results of operations. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 replaces the existing incurred loss impairment methodology in current GAAP with an expected loss impairment methodology, which considers a broader range of reasonable and supportable information to support credit loss estimates, including historical loss experience, current conditions and reasonable and foreseeable forecasts. ASU 2016-13 also requires enhanced and greater disclosure pertaining to significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of the Company’s financial instrument portfolio, including loans and securities. These changes become effective for the Company on January 1, 2020 with adoption permitted one year earlier. Management is evaluating the impact of this standard on the Company's financial position, results of operations and regulatory capital. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments . ASU 2016-15 makes eight target changes to how cash receipts and cash payments are presented and classified in the consolidated statement of cash flows. These changes become effective for the Company on January 1, 2018 with adoption on a retrospective basis. Management does not anticipate this update will have a material impact on the C |
SECURITIES AVAILABLE FOR SALE
SECURITIES AVAILABLE FOR SALE | 6 Months Ended |
Jun. 30, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
SECURITIES AVAILABLE FOR SALE | SECURITIES AVAILABLE FOR SALE The following table summarizes amortized cost and fair value of AFS securities at June 30, 2017 and December 31, 2016 , and the corresponding amounts of gross unrealized gains and losses recognized in AOCI. At June 30, 2017 and December 31, 2016 all investment securities were classified as AFS. (Dollars in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value June 30, 2017 U.S. Government Agencies $ 7,311 $ 23 $ 0 $ 7,334 States and political subdivisions 159,185 4,640 394 163,431 GSE residential MBSs 103,590 1,186 0 104,776 GSE residential CMOs 113,339 705 1,723 112,321 GSE commercial CMOs 5,141 0 168 4,973 Private label CMOs 3,542 18 20 3,540 Asset-backed 5,418 0 0 5,418 Total debt securities 397,526 6,572 2,305 401,793 Equity securities 50 61 0 111 Totals $ 397,576 $ 6,633 $ 2,305 $ 401,904 December 31, 2016 U.S. Government Agencies $ 39,569 $ 147 $ 124 $ 39,592 States and political subdivisions 163,677 1,782 1,177 164,282 GSE residential MBSs 116,022 928 6 116,944 GSE residential CMOs 72,411 240 3,268 69,383 GSE commercial CMOs 5,148 0 292 4,856 Private label CMOs 5,042 0 36 5,006 Total debt securities 401,869 3,097 4,903 400,063 Equity securities 50 41 0 91 Totals $ 401,919 $ 3,138 $ 4,903 $ 400,154 The following table summarizes AFS securities with unrealized losses at June 30, 2017 and December 31, 2016 , aggregated by major security type and length of time in a continuous unrealized loss position. Less Than 12 Months 12 Months or More Total (Dollars in thousands) # of Securities Fair Value Unrealized Losses # of Securities Fair Value Unrealized Losses # of Securities Fair Value Unrealized Losses June 30, 2017 States and political subdivisions 9 $ 19,752 $ 246 1 $ 5,469 $ 148 10 $ 25,221 $ 394 GSE residential CMOs 6 57,391 1,638 2 2,781 85 8 60,172 1,723 GSE commercial CMOs 1 4,973 168 0 0 0 1 4,973 168 Private label CMOs 0 0 0 1 1,268 20 1 1,268 20 Totals 16 $ 82,116 $ 2,052 4 $ 9,518 $ 253 20 $ 91,634 $ 2,305 December 31, 2016 U.S. Government Agencies 6 $ 10,710 $ 23 2 $ 13,531 $ 101 8 $ 24,241 $ 124 States and political subdivisions 25 58,924 610 1 5,075 567 26 63,999 1,177 GSE residential MBSs 1 5,034 6 0 0 0 1 5,034 6 GSE residential CMOs 6 59,534 3,264 1 634 4 7 60,168 3,268 GSE commercial CMOs 1 4,856 292 0 0 0 1 4,856 292 Private label CMOs 0 0 0 3 5,005 36 3 5,005 36 Totals 39 $ 139,058 $ 4,195 7 $ 24,245 $ 708 46 $ 163,303 $ 4,903 U.S. Government Agencies and GSE Securities. The unrealized losses presented in the table above have been caused by a widening of spreads and/or a rise in interest rates from the time these securities were purchased. The contractual terms of these securities do not permit the issuer to settle the securities at a price less than its par value basis. Because the Company does not intend to sell these securities and it is not more likely than not that the Company will be required to sell them before recovery of their amortized cost basis, which may be maturity, the Company does not consider these securities to be OTTI at June 30, 2017 or at December 31, 2016 . State and Political Subdivisions. The unrealized losses presented in the table above have been caused by a widening of spreads and/or a rise in interest rates from the time these securities were purchased. Management considers the investment rating, the state of the issuer of the security and other credit support in determining whether the security is OTTI. Because the Company does not intend to sell these securities and it is not more likely than not that the Company will be required to sell them before recovery of their amortized cost basis, which may be maturity, the Company does not consider these securities to be OTTI at June 30, 2017 or at December 31, 2016 . Private Label CMOs. The unrealized losses presented in the table above have been caused by a widening of spreads and/or a rise in interest rates from the time the securities were purchased. Because the Company does not intend to sell these securities and it is not more likely than not that the Company will be required to sell them before recovery of their amortized cost basis, which may be maturity, the Company does not consider these securities to be OTTI at June 30, 2017 or at December 31, 2016 . The following table summarizes amortized cost and fair value of AFS securities at June 30, 2017 by contractual maturity. Expected maturities may differ from contractual maturities if borrowers have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are shown separately. Available for Sale (Dollars in thousands) Amortized Cost Fair Value Due in one year or less $ 15 $ 15 Due after one year through five years 11,734 11,990 Due after five years through ten years 59,744 61,267 Due after ten years 95,003 97,493 MBSs and CMOs 225,612 225,610 Asset-backed 5,418 5,418 Total debt securities 397,526 401,793 Equity securities 50 111 $ 397,576 $ 401,904 The following table summarizes proceeds from sales of AFS securities and gross gains and gross losses for the three and six months ended March 31, 2017 and 2016. Three months ended June 30, Six months ended June 30, (Dollars in thousands) 2017 2016 2017 2016 Proceeds from sale of AFS securities $ 23,581 $ 0 $ 58,653 $ 64,743 Gross gains 654 0 807 1,468 Gross losses 0 0 150 48 AFS securities with a fair value of $328,664,000 and $317,282,000 at June 30, 2017 and December 31, 2016 were pledged to secure public funds and for other purposes as required or permitted by law. |
LOANS AND ALLOWANCE FOR LOAN LO
LOANS AND ALLOWANCE FOR LOAN LOSSES | 6 Months Ended |
Jun. 30, 2017 | |
Receivables [Abstract] | |
LOANS AND ALLOWANCE FOR LOAN LOSSES | LOANS AND ALLOWANCE FOR LOAN LOSSES The Company’s loan portfolio is grouped into classes to allow management to monitor the performance by the borrower and to monitor the yield on the portfolio. Consistent with ASU 2010-20, Disclosures about the Credit Quality of Financing Receivables and the Allowance for Loan Losses, the segments are further broken down into classes to allow for differing risk characteristics within a segment. The risks associated with lending activities differ among the various loan classes and are subject to the impact of changes in interest rates, market conditions of collateral securing the loans, and general economic conditions. All of these factors may adversely impact the borrower’s ability to repay its loans and associated collateral. The Company has various types of commercial real estate loans which have differing levels of credit risk. Owner-occupied commercial real estate loans are generally dependent upon the successful operation of the borrower’s business, with the cash flows generated from the business being the primary source of repayment of the loan. If the business suffers a downturn in sales or profitability, the borrower’s ability to repay the loan could be in jeopardy. Non-owner occupied and multi-family commercial real estate loans and non-owner occupied residential loans present a different credit risk to the Company than owner-occupied commercial real estate loans, as the repayment of the loan is dependent upon the borrower’s ability to generate a sufficient level of occupancy to produce rental income that exceeds debt service requirements and operating expenses. Lower occupancy or lease rates may result in a reduction in cash flows, which hinders the ability of the borrower to meet debt service requirements, and may result in lower collateral values. The Company generally recognizes that greater risk is inherent in these credit relationships as compared to owner-occupied loans mentioned above. Acquisition and development loans consist of 1-4 family residential construction and commercial and land development loans. The risk of loss on these loans is largely dependent on the Company’s ability to assess the property’s value at the completion of the project, which should exceed the property’s construction costs. During the construction phase, a number of factors could potentially negatively impact the collateral value, including cost overruns, delays in completing the project, competition, and real estate market conditions which may change based on the supply of similar properties in the area. In the event the collateral value at the completion of the project is not sufficient to cover the outstanding loan balance, the Company must rely upon other repayment sources, including the guarantors of the project or other collateral securing the loan. Commercial and industrial loans include advances to local and regional businesses for general commercial purposes and include permanent and short-term working capital, machinery and equipment financing, and may be either in the form of lines of credit or term loans. Although commercial and industrial loans may be unsecured to our highest-rated borrowers, the majority of these loans are secured by the borrower’s accounts receivable, inventory and machinery and equipment. In a significant number of these loans, the collateral also includes the business real estate or the business owner’s personal real estate or assets. Commercial and industrial loans present credit exposure to the Company, as they are more susceptible to risk of loss during a downturn in the economy, as borrowers may have greater difficulty in meeting their debt service requirements and the value of the collateral may decline. The Company attempts to mitigate this risk through its underwriting standards, including evaluating the credit worthiness of the borrower and, to the extent available, credit ratings on the business. Additionally, monitoring of the loans through annual renewals and meetings with the borrowers are typical. However, these procedures cannot eliminate the risk of loss associated with commercial and industrial lending. Municipal loans consist of extensions of credit to municipalities and school districts within the Company’s market area. These loans generally present a lower risk than commercial and industrial loans, as they are generally secured by the municipality’s full taxing authority, by revenue obligations, or by its ability to raise assessments on its customers for a specific utility. The Company originates loans to its retail customers, including fixed-rate and adjustable rate first lien mortgage loans with the underlying 1-4 family owner-occupied residential property securing the loan. The Company’s risk exposure is minimized in these types of loans through the evaluation of the credit worthiness of the borrower, including credit scores and debt-to-income ratios, and underwriting standards which limit the loan-to-value ratio to generally no more than 80% upon loan origination, unless the borrower obtains private mortgage insurance. Home equity loans, including term loans and lines of credit, present a slightly higher risk to the Company than 1-4 family first liens, as these loans can be first or second liens on 1-4 family owner-occupied residential property, but generally can have loan-to-value ratios of no greater than 90% of the value of the real estate taken as collateral. The credit worthiness of the borrower is considered including credit scores and debt-to-income ratios, which generally cannot exceed 43% . Installment and other loans’ credit risk are mitigated through prudent underwriting standards, including the evaluation of the credit worthiness of the borrower through credit scores and debt-to-income ratios and, if secured, the collateral value of the assets. As these loans can be unsecured or secured by assets the value of which may depreciate quickly or may fluctuate, they typically present a greater risk to the Company than 1-4 family residential loans. The following table presents the loan portfolio, excluding residential LHFS, broken out by classes at June 30, 2017 and December 31, 2016 . (Dollars in thousands) June 30, 2017 December 31, 2016 Commercial real estate: Owner-occupied $ 116,419 $ 112,295 Non-owner occupied 217,070 206,358 Multi-family 48,637 47,681 Non-owner occupied residential 68,621 62,533 Acquisition and development: 1-4 family residential construction 8,036 4,663 Commercial and land development 28,481 26,085 Commercial and industrial 97,913 88,465 Municipal 51,381 53,741 Residential mortgage: First lien 150,173 139,851 Home equity - term 13,019 14,248 Home equity - lines of credit 127,262 120,353 Installment and other loans 7,370 7,118 $ 934,382 $ 883,391 In order to monitor ongoing risk associated with its loan portfolio and specific loans within the segments, management uses an internal grading system. The first several rating categories, representing the lowest risk to the Bank, are combined and given a “Pass” rating. Management generally follows regulatory definitions in assigning criticized ratings to loans, including "Special Mention," "Substandard," "Doubtful" or "Loss." The Special Mention category includes loans that have potential weaknesses that may, if not monitored or corrected, weaken the asset or inadequately protect the Bank’s position at some future date. These assets pose elevated risk, but their weakness does not yet justify a more severe, or classified rating. Substandard loans are classified as such as they have a well-defined weakness or weaknesses that jeopardize liquidation of the debt. These loans are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected. Substandard loans include loans that management has determined not to be impaired, as well as loans considered to be impaired. A Doubtful loan has a high probability of total or substantial loss, but because of specific pending events that may strengthen the asset, its classification of loss is deferred. Loss loans are considered uncollectible, as the underlying borrowers are often in bankruptcy, have suspended debt repayments, or have ceased business operations. Once a loan is classified as Loss, there is little prospect of collecting the loan’s principal or interest and it is generally written off. The Company has a loan review policy and program which is designed to identify and manage risk in the lending function. The ERM Committee, comprised of executive officers and loan department personnel, is charged with the oversight of overall credit quality and risk exposure of the Company’s loan portfolio. This includes the monitoring of the lending activities of all Company personnel with respect to underwriting and processing new loans and the timely follow-up and corrective action for loans showing signs of deterioration in quality. The Company's loan review program provides the Company with an independent review of the loan portfolio on an ongoing basis. Generally, consumer and residential mortgage loans are included in the Pass categories unless a specific action, such as extended delinquencies, bankruptcy, repossession or death of the borrower occurs, which heightens awareness as to a possible negative credit event. Internal loan reviews are completed annually on all commercial relationships with a committed loan balance in excess of $500,000 , which includes confirmation of risk rating by an independent credit officer. Credit Administration also reviews loans in excess of $1,000,000 . In addition, all relationships greater than $250,000 rated Substandard, Doubtful or Loss are reviewed and corresponding risk ratings are reaffirmed by the Company's Problem Loan Committee, with subsequent reporting to the ERM Committee. The following table summarizes the Company’s loan portfolio ratings based on its internal risk rating system at June 30, 2017 and December 31, 2016 . (Dollars in thousands) Pass Special Mention Non-Impaired Substandard Impaired - Substandard Doubtful Total June 30, 2017 Commercial real estate: Owner-occupied $ 111,737 $ 1,814 $ 1,959 $ 909 $ 0 $ 116,419 Non-owner occupied 206,823 196 10,051 0 0 217,070 Multi-family 43,526 4,159 770 182 0 48,637 Non-owner occupied residential 66,024 1,062 1,117 418 0 68,621 Acquisition and development: 1-4 family residential construction 8,036 0 0 0 0 8,036 Commercial and land development 27,849 7 625 0 0 28,481 Commercial and industrial 95,124 2,384 29 376 0 97,913 Municipal 49,392 1,989 0 0 0 51,381 Residential mortgage: First lien 146,200 0 0 3,973 0 150,173 Home equity - term 12,994 0 0 25 0 13,019 Home equity - lines of credit 126,648 81 61 472 0 127,262 Installment and other loans 7,361 0 0 9 0 7,370 $ 901,714 $ 11,692 $ 14,612 $ 6,364 $ 0 $ 934,382 December 31, 2016 Commercial real estate: Owner-occupied $ 103,652 $ 5,422 $ 2,151 $ 1,070 $ 0 $ 112,295 Non-owner occupied 190,726 4,791 10,105 736 0 206,358 Multi-family 42,473 4,222 787 199 0 47,681 Non-owner occupied residential 59,982 949 1,150 452 0 62,533 Acquisition and development: 1-4 family residential construction 4,560 103 0 0 0 4,663 Commercial and land development 25,435 10 639 1 0 26,085 Commercial and industrial 87,588 251 32 594 0 88,465 Municipal 53,741 0 0 0 0 53,741 Residential mortgage: First lien 135,558 0 0 4,293 0 139,851 Home equity - term 14,155 0 0 93 0 14,248 Home equity - lines of credit 119,681 82 61 529 0 120,353 Installment and other loans 7,112 0 0 6 0 7,118 $ 844,663 $ 15,830 $ 14,925 $ 7,973 $ 0 $ 883,391 Classified loans may also be evaluated for impairment. For commercial real estate, acquisition and development and commercial and industrial loans, a loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value, and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Generally, loans that are more than 90 days past due are deemed impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed to determine if the loan should be placed on nonaccrual status. Nonaccrual loans in the commercial and commercial real estate portfolios and any TDRs are, by definition, deemed to be impaired. Impairment is measured on a loan-by-loan basis for commercial, construction and restructured loans by either the present value of the expected future cash flows discounted at the loan’s effective interest rate, the loan’s obtainable market price, or the fair value of the collateral if the loan is collateral dependent. A loan is collateral dependent if the repayment of the loan is expected to be provided solely by the underlying collateral. For loans that are deemed to be impaired for extended periods of time, periodic updates of fair values are obtained, which may include updated appraisals. The updated fair values are incorporated into the impairment analysis as of the next reporting period. Loan charge-offs, which may include partial charge-offs, are taken on an impaired loan that is collateral dependent if the loan’s carrying balance exceeds its collateral’s appraised value; the loan has been identified as uncollectible; and it is deemed to be a confirmed loss. Typically, impaired loans with a partial charge-off will continue to be considered impaired, unless the note is split into two , and management expects the performing note to continue to perform and it is adequately secured. The second, or non-performing note, would be charged-off. Generally, an impaired loan with a partial charge-off may continue to have an impairment reserve on it after the partial charge-off, if factors warrant. At June 30, 2017 and December 31, 2016 , nearly all of the Company’s impaired loans’ extent of impairment was measured based on the estimated fair value of the collateral securing the loan, except for TDRs. By definition, TDRs are considered impaired. All restructured loan impairments were determined based on discounted cash flows for those loans classified as TDRs and still accruing interest. For real estate loans, collateral generally consists of commercial real estate, but in the case of commercial and industrial loans, it would also consist of accounts receivable, inventory, equipment or other business assets. Commercial and industrial loans may also have real estate collateral. According to policy, updated appraisals are generally required every 18 months for classified loans in excess of $250,000 . The “as is value” provided in the appraisal is often used as the fair value of the collateral in determining impairment, unless circumstances, such as subsequent improvements, approvals, or other circumstances dictate that another value provided by the appraiser is more appropriate. Generally, impaired loans secured by real estate, other than performing TDRs, are measured at fair value using certified real estate appraisals that have been completed within the last 18 months . Appraised values are further discounted for estimated costs to sell the property and other selling considerations to arrive at the property’s fair value. In those situations in which it is determined an updated appraisal is not required for loans individually evaluated for impairment, fair values are based on one, or a combination of, the following approaches. In those situations in which a combination of approaches is considered, the factor that carries the most consideration will be the one management believes is warranted. The approaches are: • Original appraisal – if the original appraisal provides a strong loan-to-value ratio (generally 70% or lower) and, after consideration of market conditions and knowledge of the property and area, it is determined by the Credit Administration staff that there has not been a significant deterioration in the collateral value, the original certified appraised value may be used. Discounts as deemed appropriate for selling costs are factored into the appraised value in arriving at fair value. • Discounted cash flows – in limited cases, discounted cash flows may be used on projects in which the collateral is liquidated to reduce the borrowings outstanding, and is used to validate collateral values derived from other approaches. Collateral on certain impaired loans is not limited to real estate, and may consist of accounts receivable, inventory, equipment or other business assets. Estimated fair values are determined based on borrowers’ financial statements, inventory ledgers, accounts receivable agings or appraisals from individuals with knowledge in the business. Stated balances are generally discounted for the age of the financial information or the quality of the assets. In determining fair value, liquidation discounts are applied to this collateral based on existing loan evaluation policies. The Company distinguishes Substandard loans on both an impaired and nonimpaired basis, as it places less emphasis on a loan’s classification, and increased reliance on whether the loan was performing in accordance with the contractual terms. A Substandard classification does not automatically meet the definition of “impaired.” A Substandard loan is one that is inadequately protected by the current sound worth and paying capacity of the obligor or the collateral pledged, if any. Extensions of credit classified as Substandard have well-defined weaknesses which may jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected. Loss potential, while existing in the aggregate amount of Substandard loans, does not have to exist in individual extensions of credit classified as Substandard. As a result, the Company’s methodology includes an evaluation of certain accruing commercial real estate, acquisition and development and commercial and industrial loans rated Substandard to be collectively evaluated for impairment as opposed to evaluating these loans individually for impairment. Although we believe these loans have well defined weaknesses and meet the definition of Substandard, they are generally performing and management has concluded that it is likely it will be able to collect the scheduled payments of principal and interest when due according to the contractual terms of the loan agreement. Larger groups of smaller balance homogeneous loans are collectively evaluated for impairment. Generally, the Company does not separately identify individual consumer and residential loans for impairment disclosures, unless such loans are the subject of a restructuring agreement due to financial difficulties of the borrower. The following table summarizes impaired loans by class, segregated by those for which a specific allowance was required and those for which a specific allowance was not required as of June 30, 2017 and December 31, 2016 . The recorded investment in loans excludes accrued interest receivable due to insignificance. Related allowances established generally pertain to those loans in which loan forbearance agreements were in the process of being negotiated or updated appraisals were pending, and the partial charge-off will be recorded when final information is received. Impaired Loans with a Specific Allowance Impaired Loans with No Specific Allowance (Dollars in thousands) Recorded Investment (Book Balance) Unpaid Principal Balance (Legal Balance) Related Allowance Recorded Investment (Book Balance) Unpaid Principal Balance (Legal Balance) June 30, 2017 Commercial real estate: Owner-occupied $ 0 $ 0 $ 0 $ 909 $ 2,098 Multi-family 0 0 0 182 360 Non-owner occupied residential 0 0 0 418 688 Commercial and industrial 0 0 0 376 508 Residential mortgage: First lien 553 553 40 3,420 4,101 Home equity - term 0 0 0 25 29 Home equity - lines of credit 0 0 0 472 613 Installment and other loans 5 5 5 4 33 $ 558 $ 558 $ 45 $ 5,806 $ 8,430 December 31, 2016 Commercial real estate: Owner-occupied $ 0 $ 0 $ 0 $ 1,070 $ 2,236 Non-owner occupied 0 0 0 736 1,323 Multi-family 0 0 0 199 368 Non-owner occupied residential 0 0 0 452 706 Acquisition and development: Commercial and land development 0 0 0 1 16 Commercial and industrial 0 0 0 594 715 Residential mortgage: First lien 643 643 43 3,650 4,399 Home equity - term 0 0 0 93 103 Home equity - lines of credit 0 0 0 529 659 Installment and other loans 0 0 0 6 34 $ 643 $ 643 $ 43 $ 7,330 $ 10,559 The following tables summarize the average recorded investment in impaired loans and related interest income recognized on loans deemed impaired for the three and six months ended June 30, 2017 and 2016 . 2017 2016 (Dollars in thousands) Average Impaired Balance Interest Income Recognized Average Impaired Balance Interest Income Recognized Three Months Ended June 30, Commercial real estate: Owner-occupied $ 979 $ 5 $ 1,954 $ 0 Non-owner occupied 0 0 7,251 0 Multi-family 186 0 221 0 Non-owner occupied residential 427 0 699 0 Acquisition and development: Commercial and land development 0 0 3 0 Commercial and industrial 404 0 514 0 Residential mortgage: First lien 4,192 21 4,618 8 Home equity – term 78 0 98 0 Home equity - lines of credit 503 1 499 0 Installment and other loans 6 0 14 0 $ 6,775 $ 27 $ 15,871 $ 8 Six Months Ended June 30, Commercial real estate: Owner-occupied $ 1,036 $ 5 $ 2,012 $ 0 Non-owner occupied 276 0 7,511 0 Multi-family 191 0 225 0 Non-owner occupied residential 437 0 787 0 Acquisition and development: Commercial and land development 0 0 4 0 Commercial and industrial 458 0 619 0 Residential mortgage: First lien 4,272 29 4,697 17 Home equity - term 87 0 100 0 Home equity - lines of credit 513 1 544 0 Installment and other loans 6 0 16 0 $ 7,276 $ 35 $ 16,515 $ 17 The following table presents impaired loans that are TDRs, with the recorded investment at June 30, 2017 and December 31, 2016 . June 30, 2017 December 31, 2016 (Dollars in thousands) Number of Contracts Recorded Investment Number of Contracts Recorded Investment Accruing: Commercial real estate: Owner-occupied 1 $ 56 0 $ 0 Residential mortgage: First lien 11 1,116 8 896 Home equity - lines of credit 1 32 1 34 13 1,204 9 930 Nonaccruing: Commercial real estate: Owner-occupied 1 61 0 0 Residential mortgage: First lien 8 746 12 1,035 Installment and other loans 1 4 1 6 10 811 13 1,041 23 $ 2,015 22 $ 1,971 The following table presents the number of loans modified, and their pre-modification and post-modification investment balances. 2017 2016 (Dollars in thousands) Number of Contracts Pre- Modification Recorded Investment Post Modification Recorded Investment Number of Contracts Pre- Modification Recorded Investment Post Modification Recorded Investment Three Months Ended June 30, Commercial real estate: Owner-occupied 1 $ 56 $ 56 0 $ 0 $ 0 Six Months Ended June 30, Commercial real estate: Owner-occupied 2 $ 119 $ 119 0 $ 0 $ 0 Residential mortgage: First lien 0 0 0 1 257 257 2 $ 119 $ 119 1 $ 257 $ 257 There were no restructured loans for the three or six months ended June 30, 2017 and 2016 that were modified as TDRs within the previous twelve months which were in payment default. The loans presented above were considered TDRs as the result of the Company agreeing to below-market interest rates given the risk of the transaction, allowing the loan to remain on interest-only status, or agreeing to a reduction in interest rates, in order to give the borrowers an opportunity to improve their cash flows. For TDRs in default of their original terms, impairment is generally determined on a collateral-dependent approach, except for accruing residential mortgage TDRs, which are generally determined on the discounted cash flow approach. Certain loans modified during a period may no longer be outstanding at the end of the period if the loan was paid off. No additional commitments have been made to borrowers whose loans are considered TDRs. Management further monitors the performance and credit quality of the loan portfolio by analyzing the average length of time a portfolio is past due, by aggregating loans based on their delinquencies. The following table presents the classes of the loan portfolio summarized by aging categories of performing loans and nonaccrual loans at June 30, 2017 and December 31, 2016 . Days Past Due (Dollars in thousands) Current 30-59 60-89 90+ (still accruing) Total Past Due Non- Accrual Total Loans June 30, 2017 Commercial real estate: Owner-occupied $ 115,561 $ 5 $ 0 $ 0 $ 5 $ 853 $ 116,419 Non-owner occupied 217,070 0 0 0 0 0 217,070 Multi-family 48,455 0 0 0 0 182 48,637 Non-owner occupied residential 68,203 0 0 0 0 418 68,621 Acquisition and development: 1-4 family residential construction 8,036 0 0 0 0 0 8,036 Commercial and land development 28,418 63 0 0 63 0 28,481 Commercial and industrial 97,507 30 0 0 30 376 97,913 Municipal 51,381 0 0 0 0 0 51,381 Residential mortgage: First lien 146,712 583 21 0 604 2,857 150,173 Home equity - term 12,964 30 0 0 30 25 13,019 Home equity - lines of credit 126,497 288 37 0 325 440 127,262 Installment and other loans 7,349 8 4 0 12 9 7,370 $ 928,153 $ 1,007 $ 62 $ 0 $ 1,069 $ 5,160 $ 934,382 December 31, 2016 Commercial real estate: Owner-occupied $ 111,225 $ 0 $ 0 $ 0 $ 0 $ 1,070 $ 112,295 Non-owner occupied 205,622 0 0 0 0 736 206,358 Multi-family 47,482 0 0 0 0 199 47,681 Non-owner occupied residential 62,081 0 0 0 0 452 62,533 Acquisition and development: 1-4 family residential construction 4,548 115 0 0 115 0 4,663 Commercial and land development 26,084 0 0 0 0 1 26,085 Commercial and industrial 87,871 0 0 0 0 594 88,465 Municipal 53,741 0 0 0 0 0 53,741 Residential mortgage: First lien 135,499 628 328 0 956 3,396 139,851 Home equity - term 14,155 0 0 0 0 93 14,248 Home equity - lines of credit 119,733 125 0 0 125 495 120,353 Installment and other loans 7,090 20 2 0 22 6 7,118 $ 875,131 $ 888 $ 330 $ 0 $ 1,218 $ 7,042 $ 883,391 The Company maintains the ALL at a level believed to be adequate by management for probable incurred credit losses. The ALL is established and maintained through a provision for loan losses charged to earnings. Quarterly, management assesses the adequacy of the ALL utilizing a defined methodology, which considers specific credit evaluation of impaired loans as discussed above, past loan loss historical experience, and qualitative factors. Management believes the approach properly addresses the requirements of ASC Subtopic 310-10-35 for loans individually identified as impaired, and ASC Subtopic 450-20 for loans collectively evaluated for impairment, and other bank regulatory guidance. In connection with its quarterly evaluation of the adequacy of the ALL, management continually reviews its methodology to determine if it continues to properly address the risk in the loan portfolio. For each loan class presented above, general allowances are provided for loans that are collectively evaluated for impairment, which is based on quantitative factors, principally historical loss trends for the respective loan class, adjusted for qualitative factors. In addition, an adjustment to the historical loss factors is made to account for delinquency and other potential risk not elsewhere defined within the ALL methodology. In addition to this quantitative analysis, adjustments to the ALL requirements are allocated on loans collectively evaluated for impairment based on additional qualitative factors, including: Nature and Volume of Loans – Factors considered include loan growth in the current and subsequent quarters based on the Company’s targeted growth and strategic plan, coupled with the types of loans booked based on risk management and credit culture, the number of exceptions to loan policy, and supervisory loan to value exceptions. Concentrations of Credit and Changes within Credit Concentrations – Factors considered include the composition of the Company’s overall portfolio and management’s evaluation related to concentration risk management and the inherent risk associated with the concentrations identified. Underwriting Standards and Recovery Practices – Factors considered include changes to underwriting standards and perceived impact on anticipated losses, trends in the number of exceptions to loan policy, supervisory loan to value exceptions, and administration of loan recovery practices. Delinquency Trends – Factors considered include the delinquency percentages noted in the portfolio relative to economic conditions, severity of the delinquencies, and whether the ratios are trending upwards or downwards. Classified Loans Trends – Factors considered include the internal loan ratings of the portfolio, the severity of the ratings, whether the loan segment’s ratings show a more favorable or less favorable trend, and underlying market conditions and their impact on the collateral values securing the loans. Experience, Ability and Depth of Management/Lending staff – Factors considered include the years of experience of senior and middle management and the lending staff, turnover of the staff, and instances of repeat criticisms of ratings. Quality of Loan Review – Factors considered include the years of experience of the loan review staff, in-house versus outsourced provider of review, turnover of staff and the perceived quality of their work in relation to other external information. National and Local Economic Conditions – Factors considered include ratios and factors considered include trends in the consumer price index, unemployment rates, housing price index, housing statistics compared to the prior year, bankruptcy rates, regulatory and legal environment risks and competition. The following table presents the activity in the ALL for the three and six months ended June 30, 2017 and 2016 . Commercial Consumer (Dollars in thousands) Commercial Real Estate Acquisition and Development Commercial and Industrial Municipal Total Residential Mortgage Installment and Other Total Unallocated Total Three Months Ended June 30, 2017 Balance, beginning of period $ 6,963 $ 513 $ 1,218 $ 106 $ 8,800 $ 3,229 $ 127 $ 3,356 $ 512 $ 12,668 Provision for loan losses (214 ) 65 69 11 (69 ) 198 13 211 (42 ) 100 Charge-offs 0 0 0 0 0 (51 ) (27 ) (78 ) 0 (78 ) Recoveries 28 1 4 0 33 10 18 28 0 61 Balance, end of period $ 6,777 $ 579 $ 1,291 $ 117 $ 8,764 $ 3,386 $ 131 $ 3,517 $ 470 $ 12,751 June 30, 2016 Balance, beginning of period $ 7,996 $ 739 $ 1,030 $ 62 $ 9,827 $ 2,677 $ 179 $ 2,856 $ 664 $ 13,347 Provision for loan losses (12 ) (152 ) 112 (1 ) (53 ) 66 26 92 (39 ) 0 Charge-offs (26 ) 0 0 0 (26 ) (80 ) (48 ) (128 ) 0 (154 ) Recoveries 175 0 6 0 181 43 23 66 0 247 Balance, end of period $ 8,133 $ 587 $ 1,148 $ 61 $ 9,929 $ 2,706 $ 180 $ 2,886 $ 625 $ 13,440 Six Months Ended June 30, 2017 Balance, beginning of period $ 7,530 $ 580 $ 1,074 $ 54 $ 9,238 $ 2,979 $ 144 $ 3,123 $ 414 $ 12,775 Provision for loan losses (738 ) (3 ) 267 63 (411 ) 441 14 455 56 100 Charge-offs (45 ) 0 (55 ) 0 (100 ) (51 ) (56 ) (107 ) 0 (207 ) Recoveries 30 2 5 0 37 17 29 46 0 83 Balance, end of period $ 6,777 $ 579 $ 1,291 $ 117 $ 8,764 $ 3,386 $ 131 $ 3,517 $ 470 $ 12,751 June 30, 2016 Balance, beginning of period $ 7,883 $ 850 $ 1,012 $ 58 $ 9,803 $ 2,870 $ 121 $ 2,991 $ 774 $ 13,568 Provision for loan losses 21 (263 ) 149 3 (90 ) 111 128 239 (149 ) 0 Charge-offs (26 ) 0 (21 ) 0 (47 ) (324 ) (112 ) (436 ) 0 (483 ) Recoveries 255 0 8 0 263 49 43 92 0 355 Balance, end of period $ 8,133 $ 587 $ 1,148 $ 61 $ 9,929 $ 2,706 $ 180 $ 2,886 $ 625 $ 13,440 The following table summarizes the ending loan balance individually evaluated for impairment based upon loan segment, as well as the related ALL allocation for each at June 30, 2017 and December 31, 2016 : Commercial Consumer (Dollars in thousands) Commercial Real Estate Acquisition and Development Commercial and Industrial Municipal Total Residential Mortgage Installment and Other Total Unallocated Total June 30, 2017 Loans allocated by: Individually evaluated for impairment $ 1,509 $ 0 $ 376 $ 0 $ 1,885 $ 4,470 $ 9 $ 4,479 $ 0 $ 6,364 Collectively evaluated for impairm |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The Company files income tax returns in the U.S. federal jurisdiction, the Commonwealth of Pennsylvania and the State of Maryland. The Company is no longer subject to tax examination by tax authorities for years before 2013 . The following table summarizes income tax expense for the three and six months ended June 30, 2017 and 2016 . Three months ended June 30, Six months ended June 30, (Dollars in thousands) 2017 2016 2017 2016 Current year expense (benefit): Federal $ 145 $ 238 $ 202 $ 126 State (9 ) (1 ) (7 ) (3 ) 136 237 195 123 Deferred expense: Federal 371 10 735 732 State 9 5 10 11 380 15 745 743 Income tax expense $ 516 $ 252 $ 940 $ 866 The provision for income taxes includes $222,000 and $0 of applicable income tax expense related to net securities gains for the three months ended June 30, 2017 and 2016 , and $223,000 and $497,000 of applicable income tax expense related to net securities gains for the six months ended June 30, 2017 and 2016 . The base federal statutory rate used in determining the estimated annual effective tax rate for the quarter ended June 30, 2017 was 34% . The estimated annual effective tax rate used to determine tax expense in the quarter ended June 30, 2016 was based on a federal statutory rate of 35% . In the third quarter of 2016, the Company reassessed its estimated annual effective tax rate and changed the base federal statutory rate to 34% in expectation that the Company would not be in the higher tax bracket. The following table presents the components of the net deferred tax asset, included in other assets on the consolidated balance sheets. (Dollars in thousands) June 30, December 31, Deferred tax assets: Allowance for loan losses $ 4,719 $ 4,725 Deferred compensation 548 545 Retirement plans and salary continuation 2,018 1,942 Share-based compensation 730 583 Off-balance sheet reserves 337 313 Nonaccrual loan interest 466 370 Net unrealized losses on securities available for sale 0 600 Goodwill 77 92 Bonus accrual 321 236 Low-income housing credit carryforward 2,148 1,983 Alternative minimum tax credit carryforward 4,348 4,048 Net operating loss carryforward 804 2,520 Other 523 479 Total deferred tax assets 17,039 18,436 Deferred tax liabilities: Depreciation 694 771 Net unrealized gains on securities available for sale 1,472 0 Mortgage servicing rights 814 777 Purchase accounting adjustments 420 435 Other 198 195 Total deferred tax liabilities 3,598 2,178 Net deferred tax asset $ 13,441 $ 16,258 The provision for income taxes differs from that computed by applying statutory rates to income before income taxes primarily due to the effects of tax-exempt income, non-deductible expenses and tax credits. At June 30, 2017 , the Company had low-income housing and net operating loss carryforwards that expire through 2036 and 2032 , respectively. |
SHARE-BASED COMPENSATION PLANS
SHARE-BASED COMPENSATION PLANS | 6 Months Ended |
Jun. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
SHARE-BASED COMPENSATION PLANS | SHARE-BASED COMPENSATION PLANS The Company maintains share-based compensation plans under the shareholder-approved 2011 Plan. The purpose of the share-based compensation plans is to provide officers, employees, and non-employee members of the Board of Directors of the Company with additional incentive to further the success of the Company. Under the 2011 Plan, 381,920 shares of the common stock of the Company were reserved to be issued. At June 30, 2017 , 81,890 shares were available to be issued under the 2011 Plan. The 2011 Plan incentive awards may consist of grants of incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock, deferred stock units and performance shares. All employees of the Company and its present or future subsidiaries, and members of the Board of Directors of the Company or any subsidiary of the Company, are eligible to participate in the 2011 Plan. The Plan allows for the Compensation Committee of the Board of Directors to determine the type of incentive to be awarded, its term, manner of exercise, vesting of awards and restrictions on shares. Generally, awards are nonqualified under the IRC, unless the awards are deemed to be incentive awards to employees at the Compensation Committee’s discretion. The following table presents a summary of nonvested restricted shares activity for the six months ended June 30, 2017 . Shares Weighted Average Grant Date Fair Value Nonvested restricted shares, beginning of year 227,337 $ 16.88 Granted 62,253 22.26 Forfeited (7,192 ) 18.31 Vested (12,000 ) 17.95 Nonvested restricted shares, at period end 270,398 $ 18.04 The following table presents restricted shares compensation expense, with tax benefit information, and fair value of shares vested, for the three and six months ended June 30, 2017 and 2016 . Three months ended June 30, Six months ended June 30, (Dollars in thousands) 2017 2016 2017 2016 Restricted share award expense $ 363 $ 259 $ 659 $ 496 Restricted share award tax benefit 123 91 224 174 Fair value of shares vested 263 193 263 237 At June 30, 2017 and December 31, 2016 , the unrecognized compensation expense related to the share awards totaled $2,660,000 and $2,169,000 . The unrecognized compensation expense at June 30, 2017 is expected to be recognized over a weighted-average period of 2.1 years . The following table presents a summary of outstanding stock options activity for the six months ended June 30, 2017 . Shares Weighted Average Exercise Price Outstanding at beginning of year 80,370 $ 27.37 Forfeited (1,100 ) 21.14 Expired (3,087 ) 33.98 Options outstanding and exercisable, at period end 76,183 $ 27.19 The exercise price of each option equals the market price of the Company’s stock on the grant date. An option’s maximum term is ten years . All options are fully vested upon issuance. The following table presents information pertaining to options outstanding and exercisable at June 30, 2017 . Range of Exercise Prices Number Outstanding Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price $21.14 - $24.99 33,899 2.92 $ 21.48 $25.00 - $29.99 2,792 2.76 25.76 $30.00 - $34.99 32,144 0.49 31.08 $35.00 - $37.59 7,348 2.06 37.08 $21.14 - $37.59 76,183 1.80 $ 27.19 Outstanding and exercisable options had an intrinsic value of $52,000 at June 30, 2017 and $39,000 at December 31, 2016 . The Company maintains an employee stock purchase plan to provide employees of the Company an opportunity to purchase Company common stock. Eligible employees may purchase shares in an amount that does not exceed 10% of their annual salary, at the lower of 95% of the fair market value of the shares on the semi-annual offering date or related purchase date. The Company reserved 350,000 shares of its common stock to be issued under the employee stock purchase plan. At June 30, 2017 , 182,890 shares were available to be issued. The following table presents information for the employee stock purchase plan for the three and six months ended June 30, 2017 and 2016. Three months ended June 30, Six months ended June 30, (Dollars in thousands except share information) 2017 2016 2017 2016 Shares purchased 0 0 3,114 2,461 Weighted average price of shares purchased $ 0.00 $ 0.00 $ 19.71 $ 16.57 Compensation expense recognized 0 0 7 3 The Company issues new shares or treasury shares, depending on market conditions, in its share-based compensation plan awards. |
SHAREHOLDERS_ EQUITY AND REGULA
SHAREHOLDERS’ EQUITY AND REGULATORY CAPITAL | 6 Months Ended |
Jun. 30, 2017 | |
Equity [Abstract] | |
SHAREHOLDERS’ EQUITY AND REGULATORY CAPITAL | SHAREHOLDERS’ EQUITY AND REGULATORY CAPITAL Banks and bank holding companies are subject to regulatory capital requirements administered by federal banking agencies. Capital adequacy guidelines and, additionally for banks, prompt corrective action regulations, involve quantitative measures of assets, liabilities and certain off-balance sheet items calculated under regulatory accounting practices. Capital amounts and classifications are also subject to qualitative judgments by regulators. Failure to meet capital requirements can initiate regulatory action. The final rules implementing the Basel Committee on Banking Supervision's capital guidelines for U.S. Banks are being phased in through January 1, 2019. Under these rules, the Company must hold a capital conservation buffer above the adequately capitalized risk-based capital ratios. The capital conservation buffer for the Company was 0.625% for 2016 and is 1.25% for 2017, with a total buffer of 2.50% being phased in through 2019. The net unrealized gain or loss on available for sale securities is not included in computing regulatory capital. Management believes at June 30, 2017 the Company and the Bank met all capital adequacy requirements to which they were subject. Prompt corrective action regulations provide five classifications: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized and critically undercapitalized, although these terms are not used to represent overall financial condition. If adequately capitalized, regulatory approval is required to accept brokered deposits. If undercapitalized, capital distributions are limited, as is asset growth and expansion and capital restoration plans are required. At June 30, 2017 , the most recent regulatory notifications categorized the Bank as well capitalized under the regulatory framework for prompt corrective action. There are no conditions or events since that notification that management believes have changed the Bank's category. The following table presents capital amounts and ratios at June 30, 2017 and December 31, 2016 . Actual For Capital Adequacy Purposes (includes applicable capital conservation buffer) To Be Well Capitalized Under Prompt Corrective Action Provisions (Dollars in thousands) Amount Ratio Amount Ratio Amount Ratio June 30, 2017 Total Capital to risk weighted assets Consolidated $ 145,122 14.5 % $ 92,523 9.250 % n/a n/a Bank 139,953 14.0 % 92,457 9.250 % $ 99,954 10.0 % Tier 1 (Core) Capital to risk weighted assets Consolidated 132,589 13.3 % 72,518 7.250 % n/a n/a Bank 127,429 12.7 % 72,467 7.250 % 79,963 8.0 % Common Equity Tier 1 (CET1) to risk weighted assets Consolidated 132,589 13.3 % 57,514 5.750 % n/a n/a Bank 127,429 12.7 % 57,473 5.750 % 64,970 6.5 % Tier 1 (Core) Capital to average assets Consolidated 132,589 9.1 % 58,397 4.0 % n/a n/a Bank 127,429 8.7 % 58,429 4.0 % 73,037 5.0 % December 31, 2016 Total Capital to risk weighted assets Consolidated $ 139,033 14.6 % $ 82,391 8.625 % n/a n/a Bank 126,408 13.2 % 82,328 8.625 % $ 95,453 10.0 % Tier 1 (Core) Capital to risk weighted assets Consolidated 127,033 13.3 % 63,286 6.625 % n/a n/a Bank 114,417 12.0 % 63,238 6.625 % 76,363 8.0 % Common Equity Tier 1 (CET1) to risk weighted assets Consolidated 127,033 13.3 % 48,957 5.125 % n/a n/a Bank 114,417 12.0 % 48,920 5.125 % 62,045 6.5 % Tier 1 (Core) Capital to average assets Consolidated 127,033 9.3 % 54,453 4.0 % n/a n/a Bank 114,417 8.4 % 54,500 4.0 % 68,126 5.0 % In September 2015, the Board of Directors of the Company authorized a share repurchase program under which the Company may repurchase up to 5% of the Company's outstanding shares of common stock, or approximately 416,000 shares, in accordance with all applicable securities laws and regulations, including Rule 10b-18 of the Exchange Act. When and if appropriate, repurchases may be made in open market or privately negotiated transactions, depending on market conditions, regulatory requirements and other corporate considerations, as determined by management. Share repurchases may not occur and may be discontinued at any time. At June 30, 2017 , 82,725 shares had been repurchased under the program at a total cost of $1,438,000 , or $17.38 per share. On July 26, 2017 , the Board declared a cash dividend of $0.10 per common share, to be paid on August 15, 2017 to shareholders of record at August 8, 2017 . |
EARNINGS PER SHARE
EARNINGS PER SHARE | 6 Months Ended |
Jun. 30, 2017 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | EARNINGS PER SHARE The following table presents earnings per share for the three and six months ended June 30, 2017 and 2016 . Three Months Ended June 30, Six Months Ended June 30, (Dollars in thousands, except per share data) 2017 2016 2017 2016 Net income $ 3,308 $ 678 $ 5,310 $ 3,258 Weighted average shares outstanding - basic 8,069 8,053 8,064 8,062 Dilutive effect of share-based compensation 139 83 139 76 Weighted average shares outstanding - diluted 8,208 8,136 8,203 8,138 Per share information: Basic earnings per share $ 0.41 $ 0.08 $ 0.66 $ 0.40 Diluted earnings per share 0.40 0.08 0.65 0.40 Average outstanding stock options of 46,000 and 96,000 for the three months ended June 30, 2017 and 2016 , and of 48,000 and 101,000 for the six months ended June 30, 2017 and 2016 , were not included in the computation of earnings per share because the effect was antidilutive, due to the exercise price exceeding the average market price. The dilutive effect of share-based compensation in each period above relates principally to restricted stock awards. |
FINANCIAL INSTRUMENTS WITH OFF-
FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK | FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK The Company is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financial needs of its customers and to reduce its own exposure to fluctuations in interest rates. These financial instruments include commitments to extend credit and standby letters of credit. Those instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the consolidated balance sheets. The contractual amounts of those instruments reflect the extent of involvement the Company has in particular classes of financial instruments. The Company’s exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to extend credit and standby letters of credit and financial guarantees written is represented by the contractual amount of those instruments. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments. Contract or Notional Amount (Dollars in thousands) June 30, 2017 December 31, 2016 Commitments to fund: Home equity lines of credit $ 131,944 $ 126,811 1-4 family residential construction loans 12,709 7,820 Commercial real estate, construction and land development loans 39,339 43,830 Commercial, industrial and other loans 136,092 111,884 Standby letters of credit 7,668 7,097 Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Company evaluates each customer’s credit-worthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Company upon extension of credit, is based on management’s credit evaluation of the customer. Collateral varies but may include accounts receivable, inventory, equipment, residential real estate, and income-producing commercial properties. Standby letters of credit and financial guarantees written are conditional commitments issued by the Company to guarantee the performance of a customer to a third party. Those guarantees are primarily issued to support public and private borrowing arrangements. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loans to customers. The Company holds collateral supporting those commitments when deemed necessary by management. The liability, at June 30, 2017 and December 31, 2016 , for guarantees under standby letters of credit issued was not material. The Company currently maintains a reserve in other liabilities totaling $829,000 and $784,000 at June 30, 2017 and December 31, 2016 for off-balance sheet credit exposures that currently are not funded, based on historical loss experience of the related loan class. The following table presents the net amount expensed for the off-balance sheet credit exposures reserve for the three and six months ended June 30, 2017 and 2016. Three months ended June 30, Six months ended June 30, (Dollars in thousands) 2017 2016 2017 2016 Off-balance sheet credit exposures expense $ 140 $ 252 $ 45 $ 299 The Company sells loans to the FHLB of Chicago as part of its MPF Program. Under the terms of the MPF Program, there is limited recourse back to the Company for loans that do not perform in accordance with the terms of the loan agreement. Each loan that is sold under the program is “credit enhanced” such that the individual loan’s rating is raised to “AA,” as determined by the FHLB of Chicago. The total outstanding balance of loans sold under the MPF Program was $32,554,000 and $35,678,000 at June 30, 2017 and December 31, 2016 , with limited recourse back to the Company on these loans of $1,029,000 at each period end. Many of the loans sold under the MPF Program have primary mortgage insurance, which reduces the Company’s overall exposure. The net amount expensed (recovered) for the Company's estimate of losses under its recourse exposure for loans foreclosed, or in the process of foreclosure, is recorded in other expenses. The following table presents the net amounts recovered for the three and six months ended June 30, 2017 and 2016. Three months ended June 30, Six months ended June 30, (Dollars in thousands) 2017 2016 2017 2016 MPF program recourse loss recoveries $ (35 ) $ (59 ) $ (26 ) $ (112 ) |
FAIR VALUE
FAIR VALUE | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE | FAIR VALUE Fair value is the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Certain financial instruments and all non-financial instruments are excluded from disclosure requirements. Accordingly, the aggregate fair value amounts presented do not represent the underlying value of the Company. The fair value hierarchy distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity's own assumptions about market participant assumptions based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are: Level 1 – quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access at the measurement date. Level 2 – significant other observable inputs other than Level 1 prices such as prices for similar assets and liabilities in active markets; quoted prices for identical or similar instruments in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. Level 3 – at least one significant unobservable input that reflects a company's own assumptions about the assumptions that market participants would use in pricing an asset or liability. In instances in which multiple levels of inputs are used to measure fair value, hierarchy classification is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company's assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability. The Company used the following methods and significant assumptions to estimate fair value for instruments measured on a recurring basis: Securities Where quoted prices are available in an active market, securities are classified within Level 1 of the valuation hierarchy. Level 1 securities would include highly liquid government bonds, mortgage products and exchange traded equities. If quoted market prices are not available, securities are classified within Level 2 and fair values are estimated by using pricing models, quoted prices of securities with similar characteristics or discounted cash flow. Level 2 securities would include U.S. agency securities, mortgage-backed agency securities, obligations of states and political subdivisions and certain corporate, asset backed and other securities. In certain cases where there is limited activity or less transparency around inputs to the valuation, securities are classified within Level 3 of the valuation hierarchy. All of the Company’s securities are classified as available for sale. The Company had no fair value liabilities measured on a recurring basis at June 30, 2017 and December 31, 2016 . The following table summarizes assets at June 30, 2017 and December 31, 2016 , measured at fair value on a recurring basis. (Dollars in Thousands) Level 1 Level 2 Level 3 Total Fair Value Measurements June 30, 2017 AFS Securities: U.S. Government Agencies $ 0 $ 7,334 $ 0 $ 7,334 States and political subdivisions 0 163,431 0 163,431 GSE residential MBSs 0 104,776 0 104,776 GSE residential CMOs 0 112,321 0 112,321 GSE commercial CMOs 0 4,973 0 4,973 Private label CMOs 0 3,540 0 3,540 Asset-backed 0 5,418 0 5,418 Total debt securities 0 401,793 0 401,793 Equity securities 0 111 0 111 Total securities $ 0 $ 401,904 $ 0 $ 401,904 December 31, 2016 AFS Securities: U.S. Government Agencies $ 0 $ 39,592 $ 0 $ 39,592 States and political subdivisions 0 164,282 0 164,282 GSE residential MBSs 0 116,944 0 116,944 GSE residential CMOs 0 69,383 0 69,383 GSE commercial CMOs 0 4,856 0 4,856 Private label CMOs 0 5,006 0 5,006 Total debt securities 0 400,063 0 400,063 Equity securities 0 91 0 91 Total securities $ 0 $ 400,154 $ 0 $ 400,154 Certain financial assets are measured at fair value on a nonrecurring basis. Adjustments to the fair value of these assets usually result from the application of lower-of-cost-or-market accounting or write-downs of individual assets. The Company used the following methods and significant assumptions to estimate fair value for these financial assets. Impaired Loans Loans are designated as impaired when, in the judgment of management and based on current information and events, it is probable that all amounts due, according to the contractual terms of the loan agreement, will not be collected. The measurement of loss associated with impaired loans for all loan classes can be based on either the observable market price of the loan, the fair value of the collateral, or discounted cash flows based on a market rate of interest for performing TDRs. For collateral-dependent loans, fair value is measured based on the value of the collateral securing the loan, less estimated costs to sell. Collateral may be in the form of real estate or business assets including equipment, inventory, and accounts receivable. The value of the real estate collateral is determined utilizing an income or market valuation approach based on an appraisal conducted by an independent, licensed appraiser outside of the Company using observable market data (Level 2). However, if the collateral is a house or building in the process of construction, or if management adjusts the appraisal value, then the fair value is considered Level 3. The value of business equipment is based upon an outside appraisal, if deemed significant, or the net book value on the applicable business’ financial statements if not considered significant using observable market data. Likewise, values for inventory and accounts receivable collateral are based on financial statement balances or aging reports (Level 3). Impaired loans with an allocation to the ALL are measured at fair value on a nonrecurring basis. Any fair value adjustments are recorded in the period incurred as provision for loan losses on the consolidated statements of income. Specific allocations to the ALL or partial charge-offs totaled $1,445,000 and $1,967,000 at June 30, 2017 and December 31, 2016 . The following table presents changes in the fair value for impaired loans still held at June 30, considered in the determination of the provision for loan losses, for the three and six months ended June 30, 2017 and 2016. Three months ended June 30, Six months ended June 30, (Dollars in thousands) 2017 2016 2017 2016 Changes in fair value of impaired loans still held at June 30 $ 4 $ 183 $ 2 $ 162 Foreclosed Real Estate OREO property acquired through foreclosure is initially recorded at the fair value of the property at the transfer date less estimated selling cost. Subsequently, OREO is carried at the lower of its carrying value or the fair value less estimated selling cost. Fair value is usually determined based upon an independent third-party appraisal of the property or occasionally upon a recent sales offer. Specific charges to value the real estate owned at the lower of cost or fair value on properties held at June 30, 2017 and December 31, 2016 totaled $11,000 and $43,000 . The following table presents changes in the fair value of OREO for properties still held at June 30, charged to real estate expenses, for the three and six months ended June 30, 2017 and 2016. Three months ended June 30, Six months ended June 30, (Dollars in thousands) 2017 2016 2017 2016 Changes in fair value of OREO still held at June 30 $ 0 $ 44 $ 0 $ 95 The following table summarizes assets at June 30, 2017 and December 31, 2016 , measured at fair value on a nonrecurring basis: (Dollars in thousands) Level 1 Level 2 Level 3 Total Fair Value Measurements June 30, 2017 Impaired Loans Commercial real estate: Owner-occupied $ 0 $ 0 $ 517 $ 517 Multi-family 0 0 182 182 Non-owner occupied residential 0 0 378 378 Commercial and industrial 0 0 63 63 Residential mortgage: First lien 0 0 1,781 1,781 Home equity - lines of credit 0 0 154 154 Installment and other loans 0 0 5 5 Total impaired loans $ 0 $ 0 $ 3,080 $ 3,080 Foreclosed real estate Residential $ 0 $ 0 $ 22 $ 22 December 31, 2016 Impaired Loans Commercial real estate: Owner-occupied $ 0 $ 0 $ 777 $ 777 Non-owner occupied 0 0 736 736 Multi-family 0 0 199 199 Non-owner occupied residential 0 0 409 409 Acquisition and development: Commercial and land development 0 0 1 1 Commercial and industrial 0 0 66 66 Residential mortgage: First lien 0 0 1,994 1,994 Home equity - lines of credit 0 0 162 162 Installment and other loans 0 0 6 6 Total impaired loans $ 0 $ 0 $ 4,350 $ 4,350 Foreclosed real estate Residential $ 0 $ 0 $ 88 $ 88 The following table presents additional qualitative information about assets measured on a nonrecurring basis and for which the Company has utilized Level 3 inputs to determine fair value. (Dollars in thousands) Fair Value Estimate Valuation Techniques Unobservable Input Range June 30, 2017 Impaired loans $ 3,080 Appraisal of Management adjustments on appraisals for property type and recent activity 10% - 75% discount - Management adjustments for liquidation expenses 0% - 38% discount Foreclosed real estate 22 Appraisal of Management adjustments on appraisals for property type and recent activity 17% discount - Management adjustments for liquidation expenses 10% discount December 31, 2016 Impaired loans $ 4,350 Appraisal of Management adjustments on appraisals for property type and recent activity 10% - 75% discount - Management adjustments for liquidation expenses 0% - 41% discount Foreclosed real estate 88 Appraisal of Management adjustments on appraisals for property type and recent activity 13% - 17% discount - Management adjustments for liquidation expenses 10% - 18% discount Fair values of financial instruments In addition to those disclosed above, the Company used the following methods and significant assumptions to estimate fair value for the indicated instruments: Cash and Due from Banks and Interest-Bearing Deposits with Banks The carrying amounts of cash and due from banks and interest-bearing deposits with banks approximate fair value. Loans Held for Sale LHFS are carried at the lower of cost or fair value. These loans typically consist of one-to-four family residential loans originated for sale into the secondary market. Fair value is based on the price secondary markets are currently offering for similar loans using observable market data which is not materially different than cost due to the short duration between origination and sale. Loans For variable rate loans that reprice frequently and have no significant change in credit risk, fair value is based on carrying value. Fair value for fixed rate loans is estimated using discounted cash flow analyses, using interest rates currently being offered in the market for loans with similar terms to borrowers of similar credit quality. Restricted Investment in Bank Stock These investments are carried at cost. The Company is required to maintain minimum investment balances in these stocks, which are not actively traded and therefore have no readily determinable market value. Deposits The fair value disclosed for demand deposits is, by definition, equal to the amount payable on demand at the reporting date (that is, the carrying amount). The carrying amount of variable rate, fixed-term money market accounts and certificates of deposit approximates fair value at the reporting date. Fair value for fixed rate certificates of deposits and Individual Retirement Accounts are estimated using a discounted cash flow calculation that applies interest rates currently being offered in the market to a schedule of aggregated expected maturities on time deposits. Short-Term Borrowings The carrying amounts of federal funds purchased, borrowings under Repurchase Agreements, and other short-term borrowings maturing within 90 days approximate their fair values. Fair values of other short-term borrowings are estimated using discounted cash flow analysis based on the Company’s current borrowing rates for similar types of borrowing arrangements. Long-Term Debt Fair value of the Company’s fixed rate long-term borrowings is estimated using a discounted cash flow analysis based on the Company’s current incremental borrowing rate for similar types of borrowing arrangements. The carrying amounts of variable rate long-term borrowings approximates fair value at the reporting date. Accrued Interest The carrying amounts of accrued interest receivable and payable approximate their fair values. Off-Balance-Sheet Instruments The Company generally does not charge commitment fees. Fees for standby letters of credit and other off-balance sheet instruments are not significant. The following table presents estimated fair values of the Company’s financial instruments at June 30, 2017 and December 31, 2016 : (Dollars in thousands) Carrying Amount Fair Value Level 1 Level 2 Level 3 June 30, 2017 Financial Assets Cash and due from banks $ 19,754 $ 19,754 $ 19,754 $ 0 $ 0 Interest-bearing deposits with banks 18,258 18,258 18,258 0 0 Restricted investments in bank stocks 7,072 n/a n/a n/a n/a AFS securities 401,904 401,904 0 401,904 0 Loans held for sale 5,182 5,320 0 5,320 0 Loans, net of allowance for loan losses 921,631 922,642 0 0 922,642 Accrued interest receivable 4,467 4,467 0 2,501 1,966 Financial Liabilities Deposits 1,195,936 1,193,225 0 1,193,225 0 Short-term borrowings 90,562 90,562 0 90,562 0 Long-term debt 23,991 24,487 0 24,487 0 Accrued interest payable 448 448 0 448 0 Off-balance sheet instruments 0 0 0 0 0 December 31, 2016 Financial Assets Cash and due from banks $ 16,072 $ 16,072 $ 16,072 $ 0 $ 0 Interest-bearing deposits with banks 14,201 14,201 14,201 0 0 Restricted investments in bank stocks 7,970 n/a n/a n/a n/a AFS securities 400,154 400,154 0 400,154 0 Loans held for sale 2,768 2,843 0 2,843 0 Loans, net of allowance for loan losses 870,616 870,470 0 0 870,470 Accrued interest receivable 4,672 4,672 0 2,643 2,029 Financial Liabilities Deposits 1,152,452 1,149,727 0 1,149,727 0 Short-term borrowings 87,864 87,864 0 87,864 0 Long-term debt 24,163 24,966 0 24,966 0 Accrued interest payable 437 437 0 437 0 Off-balance sheet instruments 0 0 0 0 0 |
CONTINGENCIES
CONTINGENCIES | 6 Months Ended |
Jun. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
CONTINGENCIES | CONTINGENCIES The nature of the Company’s business generates a certain amount of litigation involving matters arising out of the ordinary course of business. Except as described below, in the opinion of management, there are no legal proceedings that might have a material effect on the results of operations, liquidity, or the financial position of the Company at this time. On May 25, 2012, SEPTA filed a putative class action complaint in the United States District Court for the Middle District of Pennsylvania against the Company, the Bank and certain current and former directors and executive officers (collectively, the “Defendants”). The complaint alleged, among other things, that (i) in connection with the Company’s Registration Statement on Form S-3 dated February 23, 2010 and its Prospectus Supplement dated March 23, 2010, and (ii) during the purported class period of March 24, 2010 through October 27, 2011, the Company issued materially false and misleading statements regarding the Company’s lending practices and financial results, including misleading statements concerning the stringent nature of the Bank’s credit practices and underwriting standards, the quality of its loan portfolio, and the intended use of the proceeds from the Company’s March 2010 public offering of common stock. The complaint asserted claims under Sections 11, 12(a) and 15 of the Securities Act, Sections 10(b) and 20(a) of the Exchange Act of 1934 and Rule 10b-5 promulgated thereunder, and seeks class certification, unspecified money damages, interest, costs, fees and equitable or injunctive relief. Under the Private Securities Litigation Reform Act of 1995 (“PSLRA”), motions for appointment of Lead Plaintiff in this case were due by July 24, 2012. SEPTA was the sole movant and the Court appointed SEPTA Lead Plaintiff on August 20, 2012. Pursuant to the PSLRA and the Court’s September 27, 2012 Order, SEPTA was given until October 26, 2012 to file an amended complaint and the Defendants until December 7, 2012 to file a motion to dismiss the amended complaint. SEPTA’s opposition to the Defendant’s motion to dismiss was originally due January 11, 2013. Under the PSLRA, discovery and all other proceedings in the case were stayed pending the Court’s ruling on the motion to dismiss. The September 27, 2012 Order specified that if the motion to dismiss were denied, the Court would schedule a conference to address discovery and the filing of a motion for class certification. On October 26, 2012, SEPTA filed an unopposed motion for enlargement of time to file its amended complaint in order to permit the parties and new defendants to be named in the amended complaint time to discuss plaintiff’s claims and defendants’ defenses. On October 26, 2012, the Court granted SEPTA’s motion, mooting its September 27, 2012 scheduling Order, and requiring SEPTA to file its amended complaint on or before January 16, 2013 or otherwise advise the Court of circumstances that require a further enlargement of time. On January 14, 2013, the Court granted SEPTA’s second unopposed motion for enlargement of time to file an amended complaint on or before March 22, 2013. On March 4, 2013, SEPTA filed an amended complaint. The amended complaint expanded the list of defendants in the action to include the Company’s independent registered public accounting firm and the underwriters of the Company’s March 2010 public offering of common stock. In addition, among other things, the amended complaint extended the purported 1934 Exchange Act class period from March 15, 2010 through April 5, 2012. Pursuant to the Court’s March 28, 2013 Second Scheduling Order, on May 28, 2013 all defendants filed their motions to dismiss the amended complaint, and on July 22, 2013 SEPTA filed its “omnibus” opposition to all of the defendants’ motions to dismiss. On August 23, 2013, all defendants filed reply briefs in further support of their motions to dismiss. On December 5, 2013, the Court ordered oral argument on the Orrstown Defendants’ motion to dismiss the amended complaint to be heard on February 7, 2014. Oral argument on the pending motions to dismiss SEPTA’s amended complaint was held on April 29, 2014. The Second Scheduling Order stayed all discovery in the case pending the outcome of the motions to dismiss, and informed the parties that, if required, a telephonic conference to address discovery and the filing of SEPTA’s motion for class certification would be scheduled after the Court’s ruling on the motions to dismiss. On April 10, 2015, pursuant to Court order, all parties filed supplemental briefs addressing the impact of the United States Supreme Court’s March 24, 2015 decision in Omnicare, Inc. v. Laborers District Council Construction Industry Pension Fund on defendants’ motions to dismiss the amended complaint. On June 22, 2015, in a 96-page Memorandum, the Court dismissed without prejudice SEPTA’s amended complaint against all defendants, finding that SEPTA failed to state a claim under either the Securities Act, as amended, or the Exchange Act. The Court ordered that, within 30 days, SEPTA either seek leave to amend its amended complaint, accompanied by the proposed amendment, or file a notice of its intention to stand on the amended complaint. On July 22, 2015, SEPTA filed a motion for leave to amend under Local Rule 15.1, and attached a copy of its proposed second amended complaint to its motion. Many of the allegations of the proposed second amended complaint were essentially the same or similar to the allegations of the dismissed amended complaint. The proposed second amended complaint also alleged that the Orrstown Defendants did not publicly disclose certain alleged failures of internal controls over loan underwriting, risk management, and financial reporting during the period 2009 to 2012, in violation of the federal securities laws. On February 8, 2016, the Court granted SEPTA’s motion for leave to amend and SEPTA filed its second amended complaint that same day. On February 25, 2016, the Court issued a scheduling Order directing: all defendants to file any motions to dismiss by March 18, 2016; SEPTA to file an omnibus opposition to defendants’ motions to dismiss by April 8, 2016; and all defendants to file reply briefs in support of their motions to dismiss by April 22, 2016. Defendants timely filed their motions to dismiss the second amended complaint and the parties filed their briefs in accordance with the Court-ordered schedule, above. The February 25, 2016 Order stayed all discovery and other deadlines in the case (including the filing of SEPTA’s motion for class certification) pending the outcome of the motions to dismiss. The allegations of SEPTA’s proposed second amended complaint disclosed the existence of a confidential, non-public, fact-finding inquiry regarding the Company being conducted by the SEC. As disclosed in the Company’s Form 8-K filed on September 27, 2016, on that date the Company entered into a settlement agreement with the SEC resolving the investigation of accounting and related matters at the Company for the periods ended June 30, 2010, to December 31, 2011. As part of the settlement of the SEC’s administrative proceedings and pursuant to the cease-and-desist order, without admitting or denying the SEC’s findings, the Company, its Chief Executive Officer, its former Chief Financial Officer, its former Executive Vice President and Chief Credit Officer, and its Chief Accounting Officer, agreed to pay civil money penalties to the SEC. The Company agreed to pay a civil money penalty of $1,000,000 . The Company had previously established a reserve for that amount which was expensed in the second fiscal quarter of 2016. In the settlement agreement with the SEC, the Company also agreed to cease and desist from committing or causing any violations and any future violations of Securities Act Sections 17(a)(2) and 17(a)(3) and Exchange Act Sections 13(a), 13(b)(2)(A) and 13(b)(2)(B), and Rules 12b-20, 13a-1 and 13a-13 promulgated thereunder. On September 27, 2016, the Orrstown Defendants filed with the Court a Notice of Subsequent Event in Further Support of their Motion to Dismiss the Second Amended Complaint, regarding the settlement with the SEC. The Notice attached a copy of the SEC’s cease-and-desist order and briefly described what the Company believes are the most salient terms of the neither-admit-nor-deny settlement. On September 29, 2016, SEPTA filed a Response to the Notice, in which SEPTA argued that the settlement with the SEC did not support dismissal of the second amended complaint. On December 7, 2016, the Court issued an Order and Memorandum granting in part and denying in part defendants’ motions to dismiss SEPTA’s second amended complaint. The Court granted the motions to dismiss the Securities Act claims against all defendants, and granted the motions to dismiss the Exchange Act section 10(b) and Rule 10b-5 claims against all defendants except Orrstown Financial Services, Inc., Orrstown Bank, Thomas R. Quinn, Jr., Bradley S. Everly, and Jeffrey W. Embly. The Court also denied the motions to dismiss the Exchange Act section 20(a) claims against Quinn, Everly, and Embly. On January 31, 2017, the Court entered a Case Management Order establishing the schedule for the litigation. The Case Management Order, among other things, set the following deadlines: all fact discovery closes on November 3, 2017, and SEPTA’s motion for class certification is due the same day; expert merits discovery closes March 30, 2018; summary judgment motions are due by April 27, 2018; the mandatory pretrial and settlement conference is set for September 11, 2018; and trial is scheduled for the month of October 2018. Document discovery has begun in the case and is ongoing. The Company believes that the allegations of SEPTA’s second amended complaint are without merit and intends to vigorously defend itself against those claims. It is not possible at this time to estimate reasonably possible losses, or even a range of reasonably possible losses, in connection with the litigation. |
SUMMARY OF SIGNIFICANT ACCOUN19
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
Nature of Operations | Nature of Operations – Orrstown Financial Services, Inc. and subsidiaries is a financial holding company that operates Orrstown Bank, a commercial bank with branches in Berks, Cumberland, Dauphin, Franklin, Lancaster, and Perry Counties of Pennsylvania and in Washington County, Maryland and Wheatland Advisors, Inc., a registered investment advisor non-bank subsidiary, headquartered in Lancaster, Pennsylvania, and which was acquired in December 2016. The Bank engages in lending activities including commercial, residential, commercial mortgages, construction, municipal, and various forms of consumer lending. Deposit services include checking, savings, time, and money market deposits. The Bank also provides investment and brokerage services through its OFA division. The Company and the Bank are subject to regulation by certain federal and state agencies and undergo periodic examinations by such regulatory authorities. |
Basis of Presentation | Basis of Presentation – The accompanying condensed consolidated financial statements include the accounts of Orrstown Financial Services, Inc. and its wholly owned subsidiaries, the Bank and Wheatland. The Company has prepared these unaudited condensed consolidated financial statements in accordance with GAAP for interim financial information, SEC rules that permit reduced disclosure for interim periods, and Article 10 of Regulation S-X. In the opinion of management, all adjustments (all of which are of a normal recurring nature) that are necessary for a fair statement are reflected in the unaudited condensed consolidated financial statements. The December 31, 2016 consolidated balance sheet information contained in this Quarterly Report on Form 10-Q was derived from the 2016 audited consolidated financial statements. The unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements, including the notes thereto, included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016. Operating results for the three and six months ended June 30, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017 . All significant intercompany transactions and accounts have been eliminated. Certain reclassifications have been made to prior year amounts to conform with current year classifications. The Company's management has evaluated all activity of the Company and concluded that subsequent events are properly reflected in the Company's consolidated financial statements and notes as required by GAAP. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change include the determination of the ALL and income taxes. |
Concentration of Credit Risk | Concentration of Credit Risk – The Company grants commercial, residential, construction, and municipal loans, and various forms of consumer loans to customers primarily in its market area of Berks, Cumberland, Dauphin, Franklin, Lancaster, and Perry Counties of Pennsylvania and in Washington County, Maryland. The Company's exposure to credit risk is significantly affected by changes in the economy in those areas. Although the Company maintains a diversified loan portfolio, a significant portion of its customers’ ability to honor their contracts is dependent upon economic sectors for commercial real estate, including office space, retail strip centers, multi-family and hospitality, residential building operators, sales finance, sub-dividers and developers. Management evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if collateral is deemed necessary by the Company upon the extension of credit, is based on management’s credit evaluation of the customer. Collateral held varies, but generally includes real estate and equipment. The types of securities the Company invests in are included in Note 2, Securities Available for Sale and the type of lending the Company engages in are included in Note 3, Loans and Allowance for Loan Losses. |
Cash and Cash Equivalents | Cash and Cash Equivalents – Cash and cash equivalents include cash, balances due from banks, federal funds sold and interest-bearing deposits due on demand, all of which have original maturities of 90 days or less. Net cash flows are reported for customer loan and deposit transactions, redemptions (purchases) of restricted investments in bank stocks, and short-term borrowings. |
Restricted Investments in Bank Stocks | Restricted Investments in Bank Stocks – Restricted investments in bank stocks consist of Federal Reserve Bank of Philadelphia stock, FHLB of Pittsburgh stock and Atlantic Community Bankers Bank stock. Federal law requires a member institution of the district Federal Reserve Bank and FHLB to hold stock according to predetermined formulas. Atlantic Community Bankers Bank requires its correspondent banking institutions to hold stock as a condition of membership. The restricted investment in bank stocks is carried at cost. Quarterly, management evaluates the bank stocks for impairment based on an assessment of the ultimate recoverability of cost rather than by recognizing temporary declines in value. The determination of whether a decline affects the ultimate recoverability of cost is influenced by criteria such as operating performance, liquidity, funding and capital positions, stock repurchase history, dividend history and impact of legislative and regulatory changes. |
Securities | Securities – The Company classifies debt and marketable equity securities as available for sale on the date of purchase. At June 30, 2017 and December 31, 2016 , the Company had no held to maturity or trading securities. AFS securities are reported at fair value. Interest income and dividends are recognized in interest income on an accrual basis. Purchase premiums and discounts on debt securities are amortized to interest income using the interest method over the terms of the securities and approximate the level yield method. Changes in unrealized gains and losses, net of related deferred taxes, for AFS securities are recorded in AOCI. Realized gains and losses on securities are recorded on the trade date using the specific identification method and are included in noninterest income. AFS securities include investments that management intends to use as part of its asset/liability management strategy. Securities may be sold in response to changes in interest rates, changes in prepayment rates and other factors. The Company does not have the intent to sell any of its AFS securities that are in an unrealized loss position and it is more likely than not that the Company will not be required to sell these securities before recovery of their amortized cost. Management evaluates securities for OTTI on at least a quarterly basis, and more frequently when economic or market conditions warrant such an evaluation. For securities in an unrealized loss position, management considers the extent and duration of the unrealized loss, and the financial condition and near-term prospects of the issuer. Management also assesses whether it intends to sell, or it is more likely than not that it will be required to sell, a security in an unrealized loss position before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the entire difference between amortized cost and fair value is recognized as impairment through earnings. For debt securities that do not meet the aforementioned criteria, the amount of impairment is split into two components: OTTI related to other factors, which is recognized in OCI and the remaining OTTI recognized in earnings. The credit loss is defined as the difference between the present value of the cash flows expected to be collected and the amortized cost basis. For equity securities, the entire amount of impairment is recognized through earnings. The Company’s securities are exposed to various risks, such as interest rate risk, market risk, and credit risk. Due to the level of risk associated with certain investments and the level of uncertainty related to changes in the value of investments, it is at least reasonably possible that changes in risks in the near term would materially affect investment assets reported in the consolidated financial statements. |
Loans Held for Sale | Loans Held for Sale – Loans originated and intended for sale in the secondary market are carried at the lower of aggregate cost or fair value. Gains and losses on loan sales (sales proceeds minus carrying value) are recorded in noninterest income. |
Loans | Loans – The Company grants commercial loans; residential, commercial and construction mortgage loans; and various forms of consumer loans to its customers located principally in south central Pennsylvania and northern Maryland. The ability of the Company’s debtors to honor their contracts is dependent largely upon the real estate and general economic conditions in this area. Loans that management has the intent and ability to hold for the foreseeable future or until maturity or pay-off generally are reported at their outstanding unpaid principal balances adjusted for charge-offs, the ALL, and any deferred fees or costs on originated loans. Interest income is accrued on the unpaid principal balance. Loan origination fees, net of certain direct origination costs, are deferred and amortized as a yield adjustment over the respective term of the loan. For all classes of loans, the accrual of interest income on loans, including impaired loans, ceases when principal or interest is past due 90 days or more or immediately if, in the opinion of management, full collection is unlikely. Interest will continue to accrue on loans past due 90 days or more if the collateral is adequate to cover principal and interest, and the loan is in the process of collection. Interest accrued, but not collected, at the date of placement on nonaccrual status, is reversed and charged against current interest income, unless fully collateralized. Subsequent payments received are either applied to the outstanding principal balance or recorded as interest income, depending upon management’s assessment of the ultimate collectability of principal. Loans are returned to accrual status, for all loan classes, when all the principal and interest amounts contractually due are brought current, the loan has performed in accordance with the contractual terms of the note for a reasonable period of time, generally six months , and the ultimate collectability of the total contractual principal and interest is reasonably assured. Past due status is based on contractual terms of the loan. Loans, the terms of which are modified, are classified as TDRs if a concession was granted in connection with the modification, for legal or economic reasons, related to the debtor’s financial difficulties. Concessions granted under a TDR typically involve a temporary deferral of scheduled loan payments, an extension of a loan’s stated maturity date, a temporary reduction in interest rates, or granting of an interest rate below market rates given the risk of the transaction. If a modification occurs while the loan is on accruing status, it will continue to accrue interest under the modified terms. Nonaccrual TDRs may be restored to accrual status if scheduled principal and interest payments, under the modified terms, are current for six months after modification, and the borrower continues to demonstrate its ability to meet the modified terms. TDRs are evaluated individually for impairment on a quarterly basis including monitoring of performance according to their modified terms. |
Allowance for Loan Losses | Allowance for Loan Losses – The ALL is evaluated on a quarterly basis, as losses are estimated to be probable and incurred, and, if deemed necessary, is increased through a provision for loan losses charged to earnings. Loan losses are charged against the ALL when management determines that all or a portion of the loan is uncollectible. Recoveries on previously charged-off loans are credited to the ALL when received. The ALL is allocated to loan portfolio classes on a quarterly basis, but the entire balance is available to cover losses from any of the portfolio classes when those losses are confirmed. Management uses internal policies and bank regulatory guidance in periodically evaluating loans for collectability and incorporates historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. See Note 3, Loans and Allowance for Loan Losses, for additional details. |
Loan Commitments and Related Financial Instruments | Loan Commitments and Related Financial Instruments – Financial instruments include off-balance sheet credit instruments, such as commitments to make loans and commercial letters of credit, issued to meet customer financing needs. The face amount for these items represents the exposure to loss, before considering customer collateral or ability to repay. These financial instruments are recorded when they are funded. The Company maintains a reserve for probable losses on off-balance sheet commitments which is included in Other Liabilities. |
Loans Serviced | Loans Serviced – The Bank administers secondary market mortgage programs available through the FHLB and the Federal National Mortgage Association and offers residential mortgage products and services to customers. The Bank originates single-family residential mortgage loans for immediate sale in the secondary market, and retains the servicing of those loans sold to these investors. |
Transfers of Financial Assets | Transfers of Financial Assets – Transfers of financial assets are accounted for as sales when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when (1) the assets have been isolated from the Company, (2) the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets, and (3) the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity. |
Cash Surrender Value of Life Insurance | Cash Surrender Value of Life Insurance – The Company has purchased life insurance policies on certain employees. Life insurance is recorded at the cash surrender value adjusted for other charges or other amounts due that are probable at settlement. |
Premises and Equipment | Premises and Equipment – Buildings, improvements, equipment, furniture and fixtures are carried at cost less accumulated depreciation and amortization. Land is carried at cost. Depreciation and amortization has been provided generally on the straight-line method and is computed over the estimated useful lives of the various assets as follows: buildings and improvements, including leasehold improvements – 10 to 40 years; and furniture and equipment – 3 to 15 years. Leasehold improvements are amortized over the shorter of the lease term or the indicated life. Repairs and maintenance are charged to operations as incurred, while major additions and improvements are capitalized. Gain or loss on retirement or disposal of individual assets is recorded as income or expense in the period of retirement or disposal. |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets – Goodwill is calculated as the purchase premium, if any, after adjusting for the fair value of net assets acquired in purchase transactions. Goodwill is not amortized but is reviewed for potential impairment on at least an annual basis, with testing between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit. Other intangible assets represent purchased assets that can be distinguished from goodwill because of contractual or other legal rights. The Company’s other intangible assets have finite lives and are amortized on either the sum of the years digits or straight line bases over their estimated lives, generally 10 years for deposit premiums and 10 to 15 years for customer lists. |
Mortgage Servicing Rights | Mortgage Servicing Rights – The estimated fair value of MSRs related to loans sold and serviced by the Company is recorded as an asset upon the sale of such loans. MSRs are amortized as a reduction to servicing income over the estimated lives of the underlying loans. MSRs are evaluated periodically for impairment by comparing the carrying amount to estimated fair value. Fair value is determined periodically through a discounted cash flows valuation performed by a third party. Significant inputs to the valuation include expected servicing income, net of expense, the discount rate and the expected life of the underlying loans. To the extent the amortized cost of the MSRs exceeds their estimated fair values, a valuation allowance is established for such impairment through a charge against servicing income on the consolidated statements of income. If the Company determines, based on subsequent valuations, that the impairment no longer exists or is reduced, the valuation allowance is reduced through a credit to earnings |
Foreclosed Real Estate | Foreclosed Real Estate – Real estate property acquired through foreclosure or other means is initially recorded at the fair value of the related real estate collateral at the transfer date less estimated selling costs, and subsequently at the lower of its carrying value or fair value less estimated costs to sell. Fair value is usually determined based upon an independent third-party appraisal of the property or occasionally upon a recent sales offer. Costs to maintain foreclosed real estate are expensed as incurred. Costs that significantly improve the value of the properties are capitalized. Foreclosed real estate totaled $1,012,000 and $346,000 as of June 30, 2017 and December 31, 2016 and is included in Other Assets. |
Investments In Real Estate Partnerships | Investments in Real Estate Partnerships – The Company has a 99% limited partner interest in several real estate partnerships in central Pennsylvania. These investments are affordable housing projects which entitle the Company to tax deductions and credits through 2025. The Company accounts for its investments in affordable housing projects under the proportional amortization method when the criteria are met, which is limited to one investment entered into in 2015, with the other investments accounted for under the equity method of accounting |
Advertising | Advertising – The Company expenses advertising as incurred |
Repurchase Agreements | Repurchase Agreements – The Company enters into agreements under which it sells securities subject to an obligation to repurchase the same or similar securities which are included in short-term borrowings. Under these agreements, the Company may transfer legal control over the assets but still retain effective control through an agreement that both entitles and obligates the Company to repurchase the assets. As a result, these Repurchase Agreements are accounted for as collateralized financing arrangements (i.e., secured borrowings) and not as a sale and subsequent repurchase of securities. The obligation to repurchase the securities is reflected as a liability in the Company’s consolidated balance sheets, while the securities underlying the Repurchase Agreements remaining are reflected in AFS securities; the repurchase obligation and underlying securities are not offset or netted. The Company does not enter into reverse Repurchase Agreements, so there is no offsetting to be done with Repurchase Agreements. The right of setoff for a Repurchase Agreement resembles a secured borrowing, whereby the collateral would be used to settle the fair value of the Repurchase Agreement should the Company be in default (e.g., fails to make an interest payment to the counterparty). For the Repurchase Agreements, the collateral is held by the Company in a segregated custodial account under a third party agreement. Repurchase agreements are secured by GSE MBSs and mature overnight. |
Share Compensation Plans | Share Compensation Plans – The Company has share compensation plans that cover employees and non-employee directors. Compensation expense relating to share-based payment transactions is measured based on the grant date fair value of the share award, including a Black-Scholes model for stock options. Compensation expense for all share awards is calculated and recognized over the employees’ service period, generally defined as the vesting period. |
Income Taxes | Income Taxes – Income tax accounting guidance results in two components of income tax expense: current and deferred. Current income tax expense reflects taxes to be paid or refunded for the current period by applying the provisions of the enacted tax law to the taxable income or excess of deductions over revenues. The Company determines deferred income taxes using the liability (or balance sheet) method. Under this method, the net deferred tax asset or liability is based on the tax effects of the differences between the book and tax bases of assets and liabilities, and enacted changes in tax rates and laws are recognized in the period in which they occur. Deferred income tax expense results from changes in deferred tax assets and liabilities between periods. Deferred tax assets are recognized if it is more likely than not, based on the technical merits, that the tax position will be realized or sustained upon examination. The term more likely than not means a likelihood of more than 50 percent; the terms examined and upon examination also include resolution of the related appeals or litigation processes, if any. A tax position that meets the more-likely-than-not recognition threshold is initially and subsequently measured as the largest amount of tax benefit that has a greater than 50 percent likelihood of being realized upon settlement with a taxing authority that has full knowledge of all relevant information. The determination of whether or not a tax position has met the more-likely-than-not recognition threshold considers the facts, circumstances, and information available at the reporting date and is subject to management’s judgment. Deferred tax assets are reduced by a valuation allowance if, based on the weight of evidence available, it is more likely than not that some portion or all of a deferred tax asset will not be realized. The Company recognizes interest and penalties, if any, on income taxes as a component of income tax expense. |
Loss Contingencies | Loss Contingencies – Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated. |
Treasury Stock | Treasury Stock – Common stock shares repurchased are recorded as treasury stock at cost. |
Earnings Per Share | Earnings Per Share – Basic earnings per share represents income available to common stockholders divided by the weighted average number of common shares outstanding during the period. Restricted stock awards are included in weighted average common shares outstanding as they are earned. Diluted earnings per share includes additional common shares that would have been outstanding if dilutive potential common shares had been issued. Potential common shares that may be issued by the Company relate solely to outstanding stock options and restricted stock awards and are determined using the treasury stock method. Treasury shares are not deemed outstanding for earnings per share calculations. |
Comprehensive Income | Comprehensive Income – Comprehensive income consists of net income and OCI. OCI is limited to unrealized gains (losses) on AFS securities for all periods presented |
Fair Value | Fair Value – Fair values of financial instruments are estimated using relevant market information and other assumptions, as more fully disclosed in Note 9, Fair Value. Fair value estimates involve uncertainties and matters of significant judgment. Changes in assumptions or in market conditions could significantly affect the estimates. |
Segment Reporting | Segment Reporting – The Company operates in one significant segment – Community Banking. The Company’s non-banking activities are insignificant to the consolidated financial statements. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements - In May 2014, the FASB issued ASU 2014-9, Revenue from Contracts with Customers (Topic 606) . ASU 2014-9, as amended, creates a new Topic 606 to provide guidance on revenue recognition for entities that enter into contracts with customers to transfer goods or services or enter into contracts for the transfer of nonfinancial assets. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Additional disclosures are required to provide quantitative and qualitative information regarding the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. These changes become effective for the Company on January 1, 2018. Because the guidance does not apply to revenue associated with financial instruments, including loans and securities, the new guidance is not expected to have a material impact on the components of the Consolidated Statements of Income most closely associated with financial instruments, including interest income and securities gains/losses. The Company is currently in the process of quantifying the potential impact of changes to the presentation and timing of certain items within noninterest income, and the related changes to disclosures that may be required. Management does not anticipate this update will have a material impact on the Company's financial position or results of operations. In January 2016, the FASB issued ASU 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. ASU 2016-01 provides updated accounting and reporting requirements for both public and non-public entities. The most significant provisions that will impact the Company are: AFS equity securities will be measured at fair value, with the changes in fair value recognized in the income statement; the elimination of the requirement to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments at amortized cost on the balance sheet; a provision to require the utilization of the exit price notion when measuring the fair value of financial instruments for disclosure purposes; and a requirement for separate presentation of both financial assets and liabilities by measurement category and form of financial asset on the balance sheet or accompanying notes to the financial statements. These changes become effective for the Company on January 1, 2018, using a cumulative-effect adjustment to the balance sheet. Management does not anticipate this update will have a material impact on the Company's financial position or results of operations. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) . ASU 2016-12 provides updated accounting and reporting requirements, which, among other things, require lessees to recognize the following for all leases (with the exception of short-term leases) at the commencement date: a lease liability, which is a lessee's obligation to make lease payments arising from a lease, measured on a discounted basis, and a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. These changes become effective for the Company on January 1, 2019. Earlier application is permitted. Lessees must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The modified retrospective approach would not require any transition accounting for leases that expired before the earliest comparative period presented. The Company anticipates that the impact on its balance sheet will result in an increase in assets and liabilities for its right of use assets and related lease liabilities for those leases that are outstanding at the date of adoption, however, it does not anticipate it will have a material impact on its results of operations. Management is evaluating other effects of this standard on the Company's financial position and regulatory capital. In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation: Improvements to Employee Share-Based Payment Accounting (Topic 718). ASU 2016-09 requires recognition of the income tax effects of share-based awards in the income statement when the awards vest or are settled, eliminating additional paid-in capital pools. The adoption of these changes by the Company on January 1, 2017 did not have a material impact on its financial position or results of operations. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 replaces the existing incurred loss impairment methodology in current GAAP with an expected loss impairment methodology, which considers a broader range of reasonable and supportable information to support credit loss estimates, including historical loss experience, current conditions and reasonable and foreseeable forecasts. ASU 2016-13 also requires enhanced and greater disclosure pertaining to significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of the Company’s financial instrument portfolio, including loans and securities. These changes become effective for the Company on January 1, 2020 with adoption permitted one year earlier. Management is evaluating the impact of this standard on the Company's financial position, results of operations and regulatory capital. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments . ASU 2016-15 makes eight target changes to how cash receipts and cash payments are presented and classified in the consolidated statement of cash flows. These changes become effective for the Company on January 1, 2018 with adoption on a retrospective basis. Management does not anticipate this update will have a material impact on the Company's financial position or results of operations. In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment . ASU 2017-04 simplifies how all entities assess goodwill for impairment by eliminating Step 2 from the goodwill impairment test. As amended, the goodwill impairment test will consist of one step comparing the fair value of a reporting unit with its carrying amount. An entity should recognize a goodwill impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. These changes become effective for the Company on January 1, 2020 with early adoption permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. Management does not anticipate this update will have a material impact on the Company's financial position or results of operations. In March 2017, the FASB issued ASU 2017-08, Receivables - Nonrefundable Fees and Other Costs (Subtopic 310-20) which shortens the amortization period of certain callable debt securities held at a premium to the earliest call date. This guidance would not require an accounting change for securities purchased at a discount. This change becomes effective for the Company on January 1, 2019 with early adoption permitted for interim and annual periods. Management does not anticipate this update will have a material impact on the Company's financial position or results of operations. In May 2017, the FASB issued ASU 2017-09, Compensation - Stock Compensation (Topic 718) which is intended to provide clarity and reduce both diversity in practice and cost and complexity when applying the guidance in Topic 718, Compensation - Stock Compensation, to a change in the terms or conditions of a share-based payment award. This change becomes effective for the Company on January 1, 2018 with early adoption permitted for interim and annual periods. Management does not anticipate this update will have a material impact on the consolidated financial statements and related disclosures. |
SECURITIES AVAILABLE FOR SALE (
SECURITIES AVAILABLE FOR SALE (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
Amortized Cost and Fair Values of Investment Securities Available for Sale | The following table summarizes amortized cost and fair value of AFS securities at June 30, 2017 and December 31, 2016 , and the corresponding amounts of gross unrealized gains and losses recognized in AOCI. At June 30, 2017 and December 31, 2016 all investment securities were classified as AFS. (Dollars in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value June 30, 2017 U.S. Government Agencies $ 7,311 $ 23 $ 0 $ 7,334 States and political subdivisions 159,185 4,640 394 163,431 GSE residential MBSs 103,590 1,186 0 104,776 GSE residential CMOs 113,339 705 1,723 112,321 GSE commercial CMOs 5,141 0 168 4,973 Private label CMOs 3,542 18 20 3,540 Asset-backed 5,418 0 0 5,418 Total debt securities 397,526 6,572 2,305 401,793 Equity securities 50 61 0 111 Totals $ 397,576 $ 6,633 $ 2,305 $ 401,904 December 31, 2016 U.S. Government Agencies $ 39,569 $ 147 $ 124 $ 39,592 States and political subdivisions 163,677 1,782 1,177 164,282 GSE residential MBSs 116,022 928 6 116,944 GSE residential CMOs 72,411 240 3,268 69,383 GSE commercial CMOs 5,148 0 292 4,856 Private label CMOs 5,042 0 36 5,006 Total debt securities 401,869 3,097 4,903 400,063 Equity securities 50 41 0 91 Totals $ 401,919 $ 3,138 $ 4,903 $ 400,154 |
Gross Unrealized Losses and Fair Value of Company's Available for Sale Securities | The following table summarizes AFS securities with unrealized losses at June 30, 2017 and December 31, 2016 , aggregated by major security type and length of time in a continuous unrealized loss position. Less Than 12 Months 12 Months or More Total (Dollars in thousands) # of Securities Fair Value Unrealized Losses # of Securities Fair Value Unrealized Losses # of Securities Fair Value Unrealized Losses June 30, 2017 States and political subdivisions 9 $ 19,752 $ 246 1 $ 5,469 $ 148 10 $ 25,221 $ 394 GSE residential CMOs 6 57,391 1,638 2 2,781 85 8 60,172 1,723 GSE commercial CMOs 1 4,973 168 0 0 0 1 4,973 168 Private label CMOs 0 0 0 1 1,268 20 1 1,268 20 Totals 16 $ 82,116 $ 2,052 4 $ 9,518 $ 253 20 $ 91,634 $ 2,305 December 31, 2016 U.S. Government Agencies 6 $ 10,710 $ 23 2 $ 13,531 $ 101 8 $ 24,241 $ 124 States and political subdivisions 25 58,924 610 1 5,075 567 26 63,999 1,177 GSE residential MBSs 1 5,034 6 0 0 0 1 5,034 6 GSE residential CMOs 6 59,534 3,264 1 634 4 7 60,168 3,268 GSE commercial CMOs 1 4,856 292 0 0 0 1 4,856 292 Private label CMOs 0 0 0 3 5,005 36 3 5,005 36 Totals 39 $ 139,058 $ 4,195 7 $ 24,245 $ 708 46 $ 163,303 $ 4,903 |
Schedule of Amortized Cost and Fair Values of Securities Available for Sale by Contractual Maturity | The following table summarizes amortized cost and fair value of AFS securities at June 30, 2017 by contractual maturity. Expected maturities may differ from contractual maturities if borrowers have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are shown separately. Available for Sale (Dollars in thousands) Amortized Cost Fair Value Due in one year or less $ 15 $ 15 Due after one year through five years 11,734 11,990 Due after five years through ten years 59,744 61,267 Due after ten years 95,003 97,493 MBSs and CMOs 225,612 225,610 Asset-backed 5,418 5,418 Total debt securities 397,526 401,793 Equity securities 50 111 $ 397,576 $ 401,904 |
Proceeds From Sale of Available for Sale Securities | The following table summarizes proceeds from sales of AFS securities and gross gains and gross losses for the three and six months ended March 31, 2017 and 2016. Three months ended June 30, Six months ended June 30, (Dollars in thousands) 2017 2016 2017 2016 Proceeds from sale of AFS securities $ 23,581 $ 0 $ 58,653 $ 64,743 Gross gains 654 0 807 1,468 Gross losses 0 0 150 48 |
LOANS AND ALLOWANCE FOR LOAN 21
LOANS AND ALLOWANCE FOR LOAN LOSSES (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Receivables [Abstract] | |
Summary of Loan Portfolio, Excluding Residential Loans Held for Sale, Broken Out by Classes | The following table presents the loan portfolio, excluding residential LHFS, broken out by classes at June 30, 2017 and December 31, 2016 . (Dollars in thousands) June 30, 2017 December 31, 2016 Commercial real estate: Owner-occupied $ 116,419 $ 112,295 Non-owner occupied 217,070 206,358 Multi-family 48,637 47,681 Non-owner occupied residential 68,621 62,533 Acquisition and development: 1-4 family residential construction 8,036 4,663 Commercial and land development 28,481 26,085 Commercial and industrial 97,913 88,465 Municipal 51,381 53,741 Residential mortgage: First lien 150,173 139,851 Home equity - term 13,019 14,248 Home equity - lines of credit 127,262 120,353 Installment and other loans 7,370 7,118 $ 934,382 $ 883,391 |
Bank's Ratings Based on its Internal Risk Rating System | The following table summarizes the Company’s loan portfolio ratings based on its internal risk rating system at June 30, 2017 and December 31, 2016 . (Dollars in thousands) Pass Special Mention Non-Impaired Substandard Impaired - Substandard Doubtful Total June 30, 2017 Commercial real estate: Owner-occupied $ 111,737 $ 1,814 $ 1,959 $ 909 $ 0 $ 116,419 Non-owner occupied 206,823 196 10,051 0 0 217,070 Multi-family 43,526 4,159 770 182 0 48,637 Non-owner occupied residential 66,024 1,062 1,117 418 0 68,621 Acquisition and development: 1-4 family residential construction 8,036 0 0 0 0 8,036 Commercial and land development 27,849 7 625 0 0 28,481 Commercial and industrial 95,124 2,384 29 376 0 97,913 Municipal 49,392 1,989 0 0 0 51,381 Residential mortgage: First lien 146,200 0 0 3,973 0 150,173 Home equity - term 12,994 0 0 25 0 13,019 Home equity - lines of credit 126,648 81 61 472 0 127,262 Installment and other loans 7,361 0 0 9 0 7,370 $ 901,714 $ 11,692 $ 14,612 $ 6,364 $ 0 $ 934,382 December 31, 2016 Commercial real estate: Owner-occupied $ 103,652 $ 5,422 $ 2,151 $ 1,070 $ 0 $ 112,295 Non-owner occupied 190,726 4,791 10,105 736 0 206,358 Multi-family 42,473 4,222 787 199 0 47,681 Non-owner occupied residential 59,982 949 1,150 452 0 62,533 Acquisition and development: 1-4 family residential construction 4,560 103 0 0 0 4,663 Commercial and land development 25,435 10 639 1 0 26,085 Commercial and industrial 87,588 251 32 594 0 88,465 Municipal 53,741 0 0 0 0 53,741 Residential mortgage: First lien 135,558 0 0 4,293 0 139,851 Home equity - term 14,155 0 0 93 0 14,248 Home equity - lines of credit 119,681 82 61 529 0 120,353 Installment and other loans 7,112 0 0 6 0 7,118 $ 844,663 $ 15,830 $ 14,925 $ 7,973 $ 0 $ 883,391 |
Impaired Loans by Class | The following table summarizes impaired loans by class, segregated by those for which a specific allowance was required and those for which a specific allowance was not required as of June 30, 2017 and December 31, 2016 . The recorded investment in loans excludes accrued interest receivable due to insignificance. Related allowances established generally pertain to those loans in which loan forbearance agreements were in the process of being negotiated or updated appraisals were pending, and the partial charge-off will be recorded when final information is received. Impaired Loans with a Specific Allowance Impaired Loans with No Specific Allowance (Dollars in thousands) Recorded Investment (Book Balance) Unpaid Principal Balance (Legal Balance) Related Allowance Recorded Investment (Book Balance) Unpaid Principal Balance (Legal Balance) June 30, 2017 Commercial real estate: Owner-occupied $ 0 $ 0 $ 0 $ 909 $ 2,098 Multi-family 0 0 0 182 360 Non-owner occupied residential 0 0 0 418 688 Commercial and industrial 0 0 0 376 508 Residential mortgage: First lien 553 553 40 3,420 4,101 Home equity - term 0 0 0 25 29 Home equity - lines of credit 0 0 0 472 613 Installment and other loans 5 5 5 4 33 $ 558 $ 558 $ 45 $ 5,806 $ 8,430 December 31, 2016 Commercial real estate: Owner-occupied $ 0 $ 0 $ 0 $ 1,070 $ 2,236 Non-owner occupied 0 0 0 736 1,323 Multi-family 0 0 0 199 368 Non-owner occupied residential 0 0 0 452 706 Acquisition and development: Commercial and land development 0 0 0 1 16 Commercial and industrial 0 0 0 594 715 Residential mortgage: First lien 643 643 43 3,650 4,399 Home equity - term 0 0 0 93 103 Home equity - lines of credit 0 0 0 529 659 Installment and other loans 0 0 0 6 34 $ 643 $ 643 $ 43 $ 7,330 $ 10,559 |
Average Recorded Investment in Impaired Loans and Related Interest Income | The following tables summarize the average recorded investment in impaired loans and related interest income recognized on loans deemed impaired for the three and six months ended June 30, 2017 and 2016 . 2017 2016 (Dollars in thousands) Average Impaired Balance Interest Income Recognized Average Impaired Balance Interest Income Recognized Three Months Ended June 30, Commercial real estate: Owner-occupied $ 979 $ 5 $ 1,954 $ 0 Non-owner occupied 0 0 7,251 0 Multi-family 186 0 221 0 Non-owner occupied residential 427 0 699 0 Acquisition and development: Commercial and land development 0 0 3 0 Commercial and industrial 404 0 514 0 Residential mortgage: First lien 4,192 21 4,618 8 Home equity – term 78 0 98 0 Home equity - lines of credit 503 1 499 0 Installment and other loans 6 0 14 0 $ 6,775 $ 27 $ 15,871 $ 8 Six Months Ended June 30, Commercial real estate: Owner-occupied $ 1,036 $ 5 $ 2,012 $ 0 Non-owner occupied 276 0 7,511 0 Multi-family 191 0 225 0 Non-owner occupied residential 437 0 787 0 Acquisition and development: Commercial and land development 0 0 4 0 Commercial and industrial 458 0 619 0 Residential mortgage: First lien 4,272 29 4,697 17 Home equity - term 87 0 100 0 Home equity - lines of credit 513 1 544 0 Installment and other loans 6 0 16 0 $ 7,276 $ 35 $ 16,515 $ 17 |
Troubled Debt Restructurings | The following table presents impaired loans that are TDRs, with the recorded investment at June 30, 2017 and December 31, 2016 . June 30, 2017 December 31, 2016 (Dollars in thousands) Number of Contracts Recorded Investment Number of Contracts Recorded Investment Accruing: Commercial real estate: Owner-occupied 1 $ 56 0 $ 0 Residential mortgage: First lien 11 1,116 8 896 Home equity - lines of credit 1 32 1 34 13 1,204 9 930 Nonaccruing: Commercial real estate: Owner-occupied 1 61 0 0 Residential mortgage: First lien 8 746 12 1,035 Installment and other loans 1 4 1 6 10 811 13 1,041 23 $ 2,015 22 $ 1,971 |
Number of Loans Modified and Their Pre-Modification and Post-Modification Investment Balances | The following table presents the number of loans modified, and their pre-modification and post-modification investment balances. 2017 2016 (Dollars in thousands) Number of Contracts Pre- Modification Recorded Investment Post Modification Recorded Investment Number of Contracts Pre- Modification Recorded Investment Post Modification Recorded Investment Three Months Ended June 30, Commercial real estate: Owner-occupied 1 $ 56 $ 56 0 $ 0 $ 0 Six Months Ended June 30, Commercial real estate: Owner-occupied 2 $ 119 $ 119 0 $ 0 $ 0 Residential mortgage: First lien 0 0 0 1 257 257 2 $ 119 $ 119 1 $ 257 $ 257 |
Loan Portfolio Summarized by Aging Categories of Performing Loans and Nonaccrual Loans | The following table presents the classes of the loan portfolio summarized by aging categories of performing loans and nonaccrual loans at June 30, 2017 and December 31, 2016 . Days Past Due (Dollars in thousands) Current 30-59 60-89 90+ (still accruing) Total Past Due Non- Accrual Total Loans June 30, 2017 Commercial real estate: Owner-occupied $ 115,561 $ 5 $ 0 $ 0 $ 5 $ 853 $ 116,419 Non-owner occupied 217,070 0 0 0 0 0 217,070 Multi-family 48,455 0 0 0 0 182 48,637 Non-owner occupied residential 68,203 0 0 0 0 418 68,621 Acquisition and development: 1-4 family residential construction 8,036 0 0 0 0 0 8,036 Commercial and land development 28,418 63 0 0 63 0 28,481 Commercial and industrial 97,507 30 0 0 30 376 97,913 Municipal 51,381 0 0 0 0 0 51,381 Residential mortgage: First lien 146,712 583 21 0 604 2,857 150,173 Home equity - term 12,964 30 0 0 30 25 13,019 Home equity - lines of credit 126,497 288 37 0 325 440 127,262 Installment and other loans 7,349 8 4 0 12 9 7,370 $ 928,153 $ 1,007 $ 62 $ 0 $ 1,069 $ 5,160 $ 934,382 December 31, 2016 Commercial real estate: Owner-occupied $ 111,225 $ 0 $ 0 $ 0 $ 0 $ 1,070 $ 112,295 Non-owner occupied 205,622 0 0 0 0 736 206,358 Multi-family 47,482 0 0 0 0 199 47,681 Non-owner occupied residential 62,081 0 0 0 0 452 62,533 Acquisition and development: 1-4 family residential construction 4,548 115 0 0 115 0 4,663 Commercial and land development 26,084 0 0 0 0 1 26,085 Commercial and industrial 87,871 0 0 0 0 594 88,465 Municipal 53,741 0 0 0 0 0 53,741 Residential mortgage: First lien 135,499 628 328 0 956 3,396 139,851 Home equity - term 14,155 0 0 0 0 93 14,248 Home equity - lines of credit 119,733 125 0 0 125 495 120,353 Installment and other loans 7,090 20 2 0 22 6 7,118 $ 875,131 $ 888 $ 330 $ 0 $ 1,218 $ 7,042 $ 883,391 |
Activity in Allowance for Loan Losses | The following table presents the activity in the ALL for the three and six months ended June 30, 2017 and 2016 . Commercial Consumer (Dollars in thousands) Commercial Real Estate Acquisition and Development Commercial and Industrial Municipal Total Residential Mortgage Installment and Other Total Unallocated Total Three Months Ended June 30, 2017 Balance, beginning of period $ 6,963 $ 513 $ 1,218 $ 106 $ 8,800 $ 3,229 $ 127 $ 3,356 $ 512 $ 12,668 Provision for loan losses (214 ) 65 69 11 (69 ) 198 13 211 (42 ) 100 Charge-offs 0 0 0 0 0 (51 ) (27 ) (78 ) 0 (78 ) Recoveries 28 1 4 0 33 10 18 28 0 61 Balance, end of period $ 6,777 $ 579 $ 1,291 $ 117 $ 8,764 $ 3,386 $ 131 $ 3,517 $ 470 $ 12,751 June 30, 2016 Balance, beginning of period $ 7,996 $ 739 $ 1,030 $ 62 $ 9,827 $ 2,677 $ 179 $ 2,856 $ 664 $ 13,347 Provision for loan losses (12 ) (152 ) 112 (1 ) (53 ) 66 26 92 (39 ) 0 Charge-offs (26 ) 0 0 0 (26 ) (80 ) (48 ) (128 ) 0 (154 ) Recoveries 175 0 6 0 181 43 23 66 0 247 Balance, end of period $ 8,133 $ 587 $ 1,148 $ 61 $ 9,929 $ 2,706 $ 180 $ 2,886 $ 625 $ 13,440 Six Months Ended June 30, 2017 Balance, beginning of period $ 7,530 $ 580 $ 1,074 $ 54 $ 9,238 $ 2,979 $ 144 $ 3,123 $ 414 $ 12,775 Provision for loan losses (738 ) (3 ) 267 63 (411 ) 441 14 455 56 100 Charge-offs (45 ) 0 (55 ) 0 (100 ) (51 ) (56 ) (107 ) 0 (207 ) Recoveries 30 2 5 0 37 17 29 46 0 83 Balance, end of period $ 6,777 $ 579 $ 1,291 $ 117 $ 8,764 $ 3,386 $ 131 $ 3,517 $ 470 $ 12,751 June 30, 2016 Balance, beginning of period $ 7,883 $ 850 $ 1,012 $ 58 $ 9,803 $ 2,870 $ 121 $ 2,991 $ 774 $ 13,568 Provision for loan losses 21 (263 ) 149 3 (90 ) 111 128 239 (149 ) 0 Charge-offs (26 ) 0 (21 ) 0 (47 ) (324 ) (112 ) (436 ) 0 (483 ) Recoveries 255 0 8 0 263 49 43 92 0 355 Balance, end of period $ 8,133 $ 587 $ 1,148 $ 61 $ 9,929 $ 2,706 $ 180 $ 2,886 $ 625 $ 13,440 |
Summary of Ending Loan Balances Individually Evaluated for Impairment Based on Loan Segment | The following table summarizes the ending loan balance individually evaluated for impairment based upon loan segment, as well as the related ALL allocation for each at June 30, 2017 and December 31, 2016 : Commercial Consumer (Dollars in thousands) Commercial Real Estate Acquisition and Development Commercial and Industrial Municipal Total Residential Mortgage Installment and Other Total Unallocated Total June 30, 2017 Loans allocated by: Individually evaluated for impairment $ 1,509 $ 0 $ 376 $ 0 $ 1,885 $ 4,470 $ 9 $ 4,479 $ 0 $ 6,364 Collectively evaluated for impairment 449,238 36,517 97,537 51,381 634,673 285,984 7,361 293,345 0 928,018 $ 450,747 $ 36,517 $ 97,913 $ 51,381 $ 636,558 $ 290,454 $ 7,370 $ 297,824 $ 0 $ 934,382 ALL allocated by: Individually evaluated for impairment $ 0 $ 0 $ 0 $ 0 $ 0 $ 40 $ 5 $ 45 $ 0 $ 45 Collectively evaluated for impairment 6,777 579 1,291 117 8,764 3,346 126 3,472 470 12,706 $ 6,777 $ 579 $ 1,291 $ 117 $ 8,764 $ 3,386 $ 131 $ 3,517 $ 470 $ 12,751 December 31, 2016 Loans allocated by: Individually evaluated for impairment $ 2,457 $ 1 $ 594 $ 0 $ 3,052 $ 4,915 $ 6 $ 4,921 $ 0 $ 7,973 Collectively evaluated for impairment 426,410 30,747 87,871 53,741 598,769 269,537 7,112 276,649 0 875,418 $ 428,867 $ 30,748 $ 88,465 $ 53,741 $ 601,821 $ 274,452 $ 7,118 $ 281,570 $ 0 $ 883,391 ALL allocated by: Individually evaluated for impairment $ 0 $ 0 $ 0 $ 0 $ 0 $ 43 $ 0 $ 43 $ 0 $ 43 Collectively evaluated for impairment 7,530 580 1,074 54 9,238 2,936 144 3,080 414 12,732 $ 7,530 $ 580 $ 1,074 $ 54 $ 9,238 $ 2,979 $ 144 $ 3,123 $ 414 $ 12,775 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Components of Income Tax Expense | The following table summarizes income tax expense for the three and six months ended June 30, 2017 and 2016 . Three months ended June 30, Six months ended June 30, (Dollars in thousands) 2017 2016 2017 2016 Current year expense (benefit): Federal $ 145 $ 238 $ 202 $ 126 State (9 ) (1 ) (7 ) (3 ) 136 237 195 123 Deferred expense: Federal 371 10 735 732 State 9 5 10 11 380 15 745 743 Income tax expense $ 516 $ 252 $ 940 $ 866 |
Components of Net Deferred Tax Asset | The following table presents the components of the net deferred tax asset, included in other assets on the consolidated balance sheets. (Dollars in thousands) June 30, December 31, Deferred tax assets: Allowance for loan losses $ 4,719 $ 4,725 Deferred compensation 548 545 Retirement plans and salary continuation 2,018 1,942 Share-based compensation 730 583 Off-balance sheet reserves 337 313 Nonaccrual loan interest 466 370 Net unrealized losses on securities available for sale 0 600 Goodwill 77 92 Bonus accrual 321 236 Low-income housing credit carryforward 2,148 1,983 Alternative minimum tax credit carryforward 4,348 4,048 Net operating loss carryforward 804 2,520 Other 523 479 Total deferred tax assets 17,039 18,436 Deferred tax liabilities: Depreciation 694 771 Net unrealized gains on securities available for sale 1,472 0 Mortgage servicing rights 814 777 Purchase accounting adjustments 420 435 Other 198 195 Total deferred tax liabilities 3,598 2,178 Net deferred tax asset $ 13,441 $ 16,258 |
SHARE-BASED COMPENSATION PLANS
SHARE-BASED COMPENSATION PLANS (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of Outstanding Nonvested Restricted Shares | The following table presents a summary of nonvested restricted shares activity for the six months ended June 30, 2017 . Shares Weighted Average Grant Date Fair Value Nonvested restricted shares, beginning of year 227,337 $ 16.88 Granted 62,253 22.26 Forfeited (7,192 ) 18.31 Vested (12,000 ) 17.95 Nonvested restricted shares, at period end 270,398 $ 18.04 |
Schedule of Restricted Shares Award Expense | The following table presents restricted shares compensation expense, with tax benefit information, and fair value of shares vested, for the three and six months ended June 30, 2017 and 2016 . Three months ended June 30, Six months ended June 30, (Dollars in thousands) 2017 2016 2017 2016 Restricted share award expense $ 363 $ 259 $ 659 $ 496 Restricted share award tax benefit 123 91 224 174 Fair value of shares vested 263 193 263 237 |
Summary of Outstanding Stock Options | The following table presents a summary of outstanding stock options activity for the six months ended June 30, 2017 . Shares Weighted Average Exercise Price Outstanding at beginning of year 80,370 $ 27.37 Forfeited (1,100 ) 21.14 Expired (3,087 ) 33.98 Options outstanding and exercisable, at period end 76,183 $ 27.19 |
Information Pertaining to Options Outstanding and Exercisable | The following table presents information pertaining to options outstanding and exercisable at June 30, 2017 . Range of Exercise Prices Number Outstanding Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price $21.14 - $24.99 33,899 2.92 $ 21.48 $25.00 - $29.99 2,792 2.76 25.76 $30.00 - $34.99 32,144 0.49 31.08 $35.00 - $37.59 7,348 2.06 37.08 $21.14 - $37.59 76,183 1.80 $ 27.19 |
Schedule of Employee Stock Purchase Plan | The following table presents information for the employee stock purchase plan for the three and six months ended June 30, 2017 and 2016. Three months ended June 30, Six months ended June 30, (Dollars in thousands except share information) 2017 2016 2017 2016 Shares purchased 0 0 3,114 2,461 Weighted average price of shares purchased $ 0.00 $ 0.00 $ 19.71 $ 16.57 Compensation expense recognized 0 0 7 3 |
SHAREHOLDERS_ EQUITY AND REGU24
SHAREHOLDERS’ EQUITY AND REGULATORY CAPITAL (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Equity [Abstract] | |
Bank's Actual Capital Ratios | The following table presents capital amounts and ratios at June 30, 2017 and December 31, 2016 . Actual For Capital Adequacy Purposes (includes applicable capital conservation buffer) To Be Well Capitalized Under Prompt Corrective Action Provisions (Dollars in thousands) Amount Ratio Amount Ratio Amount Ratio June 30, 2017 Total Capital to risk weighted assets Consolidated $ 145,122 14.5 % $ 92,523 9.250 % n/a n/a Bank 139,953 14.0 % 92,457 9.250 % $ 99,954 10.0 % Tier 1 (Core) Capital to risk weighted assets Consolidated 132,589 13.3 % 72,518 7.250 % n/a n/a Bank 127,429 12.7 % 72,467 7.250 % 79,963 8.0 % Common Equity Tier 1 (CET1) to risk weighted assets Consolidated 132,589 13.3 % 57,514 5.750 % n/a n/a Bank 127,429 12.7 % 57,473 5.750 % 64,970 6.5 % Tier 1 (Core) Capital to average assets Consolidated 132,589 9.1 % 58,397 4.0 % n/a n/a Bank 127,429 8.7 % 58,429 4.0 % 73,037 5.0 % December 31, 2016 Total Capital to risk weighted assets Consolidated $ 139,033 14.6 % $ 82,391 8.625 % n/a n/a Bank 126,408 13.2 % 82,328 8.625 % $ 95,453 10.0 % Tier 1 (Core) Capital to risk weighted assets Consolidated 127,033 13.3 % 63,286 6.625 % n/a n/a Bank 114,417 12.0 % 63,238 6.625 % 76,363 8.0 % Common Equity Tier 1 (CET1) to risk weighted assets Consolidated 127,033 13.3 % 48,957 5.125 % n/a n/a Bank 114,417 12.0 % 48,920 5.125 % 62,045 6.5 % Tier 1 (Core) Capital to average assets Consolidated 127,033 9.3 % 54,453 4.0 % n/a n/a Bank 114,417 8.4 % 54,500 4.0 % 68,126 5.0 % |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | The following table presents earnings per share for the three and six months ended June 30, 2017 and 2016 . Three Months Ended June 30, Six Months Ended June 30, (Dollars in thousands, except per share data) 2017 2016 2017 2016 Net income $ 3,308 $ 678 $ 5,310 $ 3,258 Weighted average shares outstanding - basic 8,069 8,053 8,064 8,062 Dilutive effect of share-based compensation 139 83 139 76 Weighted average shares outstanding - diluted 8,208 8,136 8,203 8,138 Per share information: Basic earnings per share $ 0.41 $ 0.08 $ 0.66 $ 0.40 Diluted earnings per share 0.40 0.08 0.65 0.40 |
FINANCIAL INSTRUMENTS WITH OF26
FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Commitments and Conditional Obligations | The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments. Contract or Notional Amount (Dollars in thousands) June 30, 2017 December 31, 2016 Commitments to fund: Home equity lines of credit $ 131,944 $ 126,811 1-4 family residential construction loans 12,709 7,820 Commercial real estate, construction and land development loans 39,339 43,830 Commercial, industrial and other loans 136,092 111,884 Standby letters of credit 7,668 7,097 |
Schedule of Financial Instruments With Off- balance Sheet Risk | The following table presents the net amount expensed for the off-balance sheet credit exposures reserve for the three and six months ended June 30, 2017 and 2016. Three months ended June 30, Six months ended June 30, (Dollars in thousands) 2017 2016 2017 2016 Off-balance sheet credit exposures expense $ 140 $ 252 $ 45 $ 299 |
Schedule of MPF Program Recourse Exposure | The following table presents the net amounts recovered for the three and six months ended June 30, 2017 and 2016. Three months ended June 30, Six months ended June 30, (Dollars in thousands) 2017 2016 2017 2016 MPF program recourse loss recoveries $ (35 ) $ (59 ) $ (26 ) $ (112 ) |
FAIR VALUE (Tables)
FAIR VALUE (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Summary of Assets Measured at Estimated Fair Value on Recurring Basis | The following table summarizes assets at June 30, 2017 and December 31, 2016 , measured at fair value on a recurring basis. (Dollars in Thousands) Level 1 Level 2 Level 3 Total Fair Value Measurements June 30, 2017 AFS Securities: U.S. Government Agencies $ 0 $ 7,334 $ 0 $ 7,334 States and political subdivisions 0 163,431 0 163,431 GSE residential MBSs 0 104,776 0 104,776 GSE residential CMOs 0 112,321 0 112,321 GSE commercial CMOs 0 4,973 0 4,973 Private label CMOs 0 3,540 0 3,540 Asset-backed 0 5,418 0 5,418 Total debt securities 0 401,793 0 401,793 Equity securities 0 111 0 111 Total securities $ 0 $ 401,904 $ 0 $ 401,904 December 31, 2016 AFS Securities: U.S. Government Agencies $ 0 $ 39,592 $ 0 $ 39,592 States and political subdivisions 0 164,282 0 164,282 GSE residential MBSs 0 116,944 0 116,944 GSE residential CMOs 0 69,383 0 69,383 GSE commercial CMOs 0 4,856 0 4,856 Private label CMOs 0 5,006 0 5,006 Total debt securities 0 400,063 0 400,063 Equity securities 0 91 0 91 Total securities $ 0 $ 400,154 $ 0 $ 400,154 |
Schedule of Changes in Fair Value of Impaired Loans | The following table presents changes in the fair value for impaired loans still held at June 30, considered in the determination of the provision for loan losses, for the three and six months ended June 30, 2017 and 2016. Three months ended June 30, Six months ended June 30, (Dollars in thousands) 2017 2016 2017 2016 Changes in fair value of impaired loans still held at June 30 $ 4 $ 183 $ 2 $ 162 |
Schedule of Changes in Fair Value of Foreclosed Real Estate Held | The following table presents changes in the fair value of OREO for properties still held at June 30, charged to real estate expenses, for the three and six months ended June 30, 2017 and 2016. Three months ended June 30, Six months ended June 30, (Dollars in thousands) 2017 2016 2017 2016 Changes in fair value of OREO still held at June 30 $ 0 $ 44 $ 0 $ 95 |
Summary of Assets Measured at Fair Value on Nonrecurring Basis | The following table summarizes assets at June 30, 2017 and December 31, 2016 , measured at fair value on a nonrecurring basis: (Dollars in thousands) Level 1 Level 2 Level 3 Total Fair Value Measurements June 30, 2017 Impaired Loans Commercial real estate: Owner-occupied $ 0 $ 0 $ 517 $ 517 Multi-family 0 0 182 182 Non-owner occupied residential 0 0 378 378 Commercial and industrial 0 0 63 63 Residential mortgage: First lien 0 0 1,781 1,781 Home equity - lines of credit 0 0 154 154 Installment and other loans 0 0 5 5 Total impaired loans $ 0 $ 0 $ 3,080 $ 3,080 Foreclosed real estate Residential $ 0 $ 0 $ 22 $ 22 December 31, 2016 Impaired Loans Commercial real estate: Owner-occupied $ 0 $ 0 $ 777 $ 777 Non-owner occupied 0 0 736 736 Multi-family 0 0 199 199 Non-owner occupied residential 0 0 409 409 Acquisition and development: Commercial and land development 0 0 1 1 Commercial and industrial 0 0 66 66 Residential mortgage: First lien 0 0 1,994 1,994 Home equity - lines of credit 0 0 162 162 Installment and other loans 0 0 6 6 Total impaired loans $ 0 $ 0 $ 4,350 $ 4,350 Foreclosed real estate Residential $ 0 $ 0 $ 88 $ 88 |
Summary of Additional Qualitative Information | The following table presents additional qualitative information about assets measured on a nonrecurring basis and for which the Company has utilized Level 3 inputs to determine fair value. (Dollars in thousands) Fair Value Estimate Valuation Techniques Unobservable Input Range June 30, 2017 Impaired loans $ 3,080 Appraisal of Management adjustments on appraisals for property type and recent activity 10% - 75% discount - Management adjustments for liquidation expenses 0% - 38% discount Foreclosed real estate 22 Appraisal of Management adjustments on appraisals for property type and recent activity 17% discount - Management adjustments for liquidation expenses 10% discount December 31, 2016 Impaired loans $ 4,350 Appraisal of Management adjustments on appraisals for property type and recent activity 10% - 75% discount - Management adjustments for liquidation expenses 0% - 41% discount Foreclosed real estate 88 Appraisal of Management adjustments on appraisals for property type and recent activity 13% - 17% discount - Management adjustments for liquidation expenses 10% - 18% discount |
Financial Instruments at Estimated Fair Values | The following table presents estimated fair values of the Company’s financial instruments at June 30, 2017 and December 31, 2016 : (Dollars in thousands) Carrying Amount Fair Value Level 1 Level 2 Level 3 June 30, 2017 Financial Assets Cash and due from banks $ 19,754 $ 19,754 $ 19,754 $ 0 $ 0 Interest-bearing deposits with banks 18,258 18,258 18,258 0 0 Restricted investments in bank stocks 7,072 n/a n/a n/a n/a AFS securities 401,904 401,904 0 401,904 0 Loans held for sale 5,182 5,320 0 5,320 0 Loans, net of allowance for loan losses 921,631 922,642 0 0 922,642 Accrued interest receivable 4,467 4,467 0 2,501 1,966 Financial Liabilities Deposits 1,195,936 1,193,225 0 1,193,225 0 Short-term borrowings 90,562 90,562 0 90,562 0 Long-term debt 23,991 24,487 0 24,487 0 Accrued interest payable 448 448 0 448 0 Off-balance sheet instruments 0 0 0 0 0 December 31, 2016 Financial Assets Cash and due from banks $ 16,072 $ 16,072 $ 16,072 $ 0 $ 0 Interest-bearing deposits with banks 14,201 14,201 14,201 0 0 Restricted investments in bank stocks 7,970 n/a n/a n/a n/a AFS securities 400,154 400,154 0 400,154 0 Loans held for sale 2,768 2,843 0 2,843 0 Loans, net of allowance for loan losses 870,616 870,470 0 0 870,470 Accrued interest receivable 4,672 4,672 0 2,643 2,029 Financial Liabilities Deposits 1,152,452 1,149,727 0 1,149,727 0 Short-term borrowings 87,864 87,864 0 87,864 0 Long-term debt 24,163 24,966 0 24,966 0 Accrued interest payable 437 437 0 437 0 Off-balance sheet instruments 0 0 0 0 0 |
SUMMARY OF SIGNIFICANT ACCOUN28
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Detail) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($) | Jun. 30, 2017USD ($)segment | Jun. 30, 2016USD ($) | Dec. 31, 2015investment | Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($) | |
Accounting Policies [Abstract] | |||||||
Maturity of interest bearing deposits | 90 days | ||||||
Evaluation period to return past due loans to accrual status | 6 months | ||||||
Balance of loans serviced for others | $ 328,534 | $ 328,534 | $ 328,701 | ||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Mortgage servicing rights | 2,848 | 2,848 | 2,835 | ||||
Foreclosed real estate | $ 1,012 | $ 1,012 | 346 | ||||
Percentage of limited partner interest | 99.00% | 99.00% | |||||
Number of investments accounted for under the proportional amortization method | investment | 1 | ||||||
Investment in real estate partnership | $ 4,689 | $ 4,689 | 4,909 | ||||
Investment in real estate partnerships, proportional amortization method | $ 1,888 | $ 1,993 | |||||
Loss investment in real estate partnership | 26 | $ 89 | 115 | $ 178 | |||
Losses on investments accounted for under the proportional amortization method | 52 | 53 | 105 | 86 | |||
Recognition of federal tax credits | 252 | 184 | 505 | 368 | |||
Advertising expense | $ 214 | $ 202 | $ 317 | $ 353 | |||
Number of significant operating segments | segment | 1 | ||||||
Building and Improvements | Minimum | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Plant and equipment, useful life | 10 years | ||||||
Building and Improvements | Maximum | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Plant and equipment, useful life | 40 years | ||||||
Furniture and Equipment | Minimum | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Plant and equipment, useful life | 3 years | ||||||
Furniture and Equipment | Maximum | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Plant and equipment, useful life | 15 years | ||||||
Deposit Premium | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Finite lives of intangible assets | 10 years | ||||||
Customer Lists | Minimum | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Finite lives of intangible assets | 10 years | ||||||
Customer Lists | Maximum | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Finite lives of intangible assets | 15 years |
SECURITIES AVAILABLE FOR SALE -
SECURITIES AVAILABLE FOR SALE - Amortized Cost and Fair Values of Investment Securities Available for Sale (Detail) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Amortized Cost | ||
Total debt securities | $ 397,526 | |
Equity securities | 50 | |
Totals | 397,576 | $ 401,919 |
Gross Unrealized Gains | ||
Totals | 6,633 | 3,138 |
Gross Unrealized Losses | ||
Totals | 2,305 | 4,903 |
Fair Value | ||
Total debt securities | 401,793 | |
Equity securities | 111 | |
Totals | 401,904 | 400,154 |
Debt Securities | ||
Amortized Cost | ||
Total debt securities | 397,526 | 401,869 |
Gross Unrealized Gains | ||
Total debt securities | 6,572 | 3,097 |
Gross Unrealized Losses | ||
Total debt securities | 2,305 | 4,903 |
Fair Value | ||
Total debt securities | 401,793 | 400,063 |
Debt Securities | U.S. Government Agencies | ||
Amortized Cost | ||
Total debt securities | 7,311 | 39,569 |
Gross Unrealized Gains | ||
Total debt securities | 23 | 147 |
Gross Unrealized Losses | ||
Total debt securities | 0 | 124 |
Fair Value | ||
Total debt securities | 7,334 | 39,592 |
Debt Securities | States and political subdivisions | ||
Amortized Cost | ||
Total debt securities | 159,185 | 163,677 |
Gross Unrealized Gains | ||
Total debt securities | 4,640 | 1,782 |
Gross Unrealized Losses | ||
Total debt securities | 394 | 1,177 |
Fair Value | ||
Total debt securities | 163,431 | 164,282 |
Debt Securities | GSE residential MBSs | ||
Amortized Cost | ||
Total debt securities | 103,590 | 116,022 |
Gross Unrealized Gains | ||
Total debt securities | 1,186 | 928 |
Gross Unrealized Losses | ||
Total debt securities | 0 | 6 |
Fair Value | ||
Total debt securities | 104,776 | 116,944 |
Debt Securities | GSE residential CMOs | ||
Amortized Cost | ||
Total debt securities | 113,339 | 72,411 |
Gross Unrealized Gains | ||
Total debt securities | 705 | 240 |
Gross Unrealized Losses | ||
Total debt securities | 1,723 | 3,268 |
Fair Value | ||
Total debt securities | 112,321 | 69,383 |
Debt Securities | GSE commercial CMOs | ||
Amortized Cost | ||
Total debt securities | 5,141 | 5,148 |
Gross Unrealized Gains | ||
Total debt securities | 0 | 0 |
Gross Unrealized Losses | ||
Total debt securities | 168 | 292 |
Fair Value | ||
Total debt securities | 4,973 | 4,856 |
Debt Securities | Private label CMOs | ||
Amortized Cost | ||
Total debt securities | 3,542 | 5,042 |
Gross Unrealized Gains | ||
Total debt securities | 18 | 0 |
Gross Unrealized Losses | ||
Total debt securities | 20 | 36 |
Fair Value | ||
Total debt securities | 3,540 | 5,006 |
Debt Securities | Asset-backed | ||
Amortized Cost | ||
Total debt securities | 5,418 | |
Gross Unrealized Gains | ||
Total debt securities | 0 | |
Gross Unrealized Losses | ||
Total debt securities | 0 | |
Fair Value | ||
Total debt securities | 5,418 | |
Equity Securities | ||
Amortized Cost | ||
Equity securities | 50 | 50 |
Gross Unrealized Gains | ||
Equity securities | 61 | 41 |
Gross Unrealized Losses | ||
Equity securities | 0 | 0 |
Fair Value | ||
Equity securities | $ 111 | $ 91 |
SECURITIES AVAILABLE FOR SALE30
SECURITIES AVAILABLE FOR SALE - Gross Unrealized Losses and Fair Value of Company's Available for Sale Securities (Detail) $ in Thousands | Jun. 30, 2017USD ($)security | Dec. 31, 2016USD ($)security |
Number of Securities | ||
Less than12 months | security | 16 | 39 |
12 Months or More | security | 4 | 7 |
Total | security | 20 | 46 |
Fair Value | ||
Less Than 12 Months | $ 82,116 | $ 139,058 |
12 Months or More | 9,518 | 24,245 |
Total | 91,634 | 163,303 |
Unrealized Losses | ||
Less Than 12 Months | 2,052 | 4,195 |
12 Months or More | 253 | 708 |
Total | $ 2,305 | $ 4,903 |
U.S. Government Agencies | ||
Number of Securities | ||
Less than12 months | security | 6 | |
12 Months or More | security | 2 | |
Total | security | 8 | |
Fair Value | ||
Less Than 12 Months | $ 10,710 | |
12 Months or More | 13,531 | |
Total | 24,241 | |
Unrealized Losses | ||
Less Than 12 Months | 23 | |
12 Months or More | 101 | |
Total | $ 124 | |
States and political subdivisions | ||
Number of Securities | ||
Less than12 months | security | 9 | 25 |
12 Months or More | security | 1 | 1 |
Total | security | 10 | 26 |
Fair Value | ||
Less Than 12 Months | $ 19,752 | $ 58,924 |
12 Months or More | 5,469 | 5,075 |
Total | 25,221 | 63,999 |
Unrealized Losses | ||
Less Than 12 Months | 246 | 610 |
12 Months or More | 148 | 567 |
Total | $ 394 | $ 1,177 |
GSE residential MBSs | ||
Number of Securities | ||
Less than12 months | security | 1 | |
12 Months or More | security | 0 | |
Total | security | 1 | |
Fair Value | ||
Less Than 12 Months | $ 5,034 | |
12 Months or More | 0 | |
Total | 5,034 | |
Unrealized Losses | ||
Less Than 12 Months | 6 | |
12 Months or More | 0 | |
Total | $ 6 | |
GSE residential CMOs | ||
Number of Securities | ||
Less than12 months | security | 6 | 6 |
12 Months or More | security | 2 | 1 |
Total | security | 8 | 7 |
Fair Value | ||
Less Than 12 Months | $ 57,391 | $ 59,534 |
12 Months or More | 2,781 | 634 |
Total | 60,172 | 60,168 |
Unrealized Losses | ||
Less Than 12 Months | 1,638 | 3,264 |
12 Months or More | 85 | 4 |
Total | $ 1,723 | $ 3,268 |
GSE commercial CMOs | ||
Number of Securities | ||
Less than12 months | security | 1 | 1 |
12 Months or More | security | 0 | 0 |
Total | security | 1 | 1 |
Fair Value | ||
Less Than 12 Months | $ 4,973 | $ 4,856 |
12 Months or More | 0 | 0 |
Total | 4,973 | 4,856 |
Unrealized Losses | ||
Less Than 12 Months | 168 | 292 |
12 Months or More | 0 | 0 |
Total | $ 168 | $ 292 |
Private label CMOs | ||
Number of Securities | ||
Less than12 months | security | 0 | 0 |
12 Months or More | security | 1 | 3 |
Total | security | 1 | 3 |
Fair Value | ||
Less Than 12 Months | $ 0 | $ 0 |
12 Months or More | 1,268 | 5,005 |
Total | 1,268 | 5,005 |
Unrealized Losses | ||
Less Than 12 Months | 0 | 0 |
12 Months or More | 20 | 36 |
Total | $ 20 | $ 36 |
SECURITIES AVAILABLE FOR SALE31
SECURITIES AVAILABLE FOR SALE - Schedule of Amortized Cost and Fair Values of Securities Available for Sale by Contractual Maturity (Detail) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Amortized Cost | ||
Due in one year or less | $ 15 | |
Due after one year through five years | 11,734 | |
Due after five years through ten years | 59,744 | |
Due after ten years | 95,003 | |
MBSs and CMOs | 225,612 | |
Asset-backed | 5,418 | |
Total debt securities | 397,526 | |
Equity securities | 50 | |
Totals | 397,576 | $ 401,919 |
Fair Value | ||
Due in one year or less | 15 | |
Due after one year through five years | 11,990 | |
Due after five years through ten years | 61,267 | |
Due after ten years | 97,493 | |
MBSs and CMOs | 225,610 | |
Total debt securities | 401,793 | |
Equity securities | 111 | |
Totals | $ 401,904 | $ 400,154 |
SECURITIES AVAILABLE FOR SALE32
SECURITIES AVAILABLE FOR SALE - Proceeds from Sale of AFS Securities (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Investments, Debt and Equity Securities [Abstract] | |||||
Proceeds from sale of AFS securities | $ 23,581 | $ 0 | $ 58,653 | $ 64,743 | |
Gross gains | 654 | 0 | 807 | 1,468 | |
Gross losses | 0 | $ 0 | 150 | $ 48 | |
AFS securities pledged to secure public funds, fair value | $ 328,664 | $ 328,664 | $ 317,282 |
LOANS AND ALLOWANCE FOR LOAN 33
LOANS AND ALLOWANCE FOR LOAN LOSSES - Additional Information (Detail) | 6 Months Ended |
Jun. 30, 2017USD ($)note | |
Financing Receivable, Allowance for Credit Losses [Line Items] | |
Amount of loan on which review have been made annually | $ 500,000 |
Amount of loan on which reviews may require approval | 1,000,000 |
Amount of loan on which reviews require approval | $ 250,000 |
Loans that are deemed impaired, number of days past due (more than) | 90 days |
Number of notes split | note | 2 |
Appraisals, required period interval | 18 months |
Minimum amount on which annual updated appraisals for classified loans is required | $ 250,000 |
Maximum | |
Financing Receivable, Allowance for Credit Losses [Line Items] | |
Percentage of loan-to-value ratio upon loan origination | 80.00% |
Percentage of loan-to-value ratios of the value of the real estate taken as collateral | 90.00% |
Percentage of credit worthiness of the borrower | 43.00% |
Percentage of strong loan-to-value | 70.00% |
LOANS AND ALLOWANCE FOR LOAN 34
LOANS AND ALLOWANCE FOR LOAN LOSSES - Summary of Loan Portfolio, Excluding Residential Loans Held for Sale, Broken Out by Classes (Detail) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total Loans | $ 934,382 | $ 883,391 |
Commercial real estate | Owner-occupied | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total Loans | 116,419 | 112,295 |
Commercial real estate | Non-owner occupied | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total Loans | 217,070 | 206,358 |
Commercial real estate | Multi-family | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total Loans | 48,637 | 47,681 |
Commercial real estate | Non-owner occupied residential | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total Loans | 68,621 | 62,533 |
Acquisition and development | Commercial and land development | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total Loans | 28,481 | 26,085 |
Commercial and industrial | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total Loans | 97,913 | 88,465 |
Municipal | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total Loans | 51,381 | 53,741 |
Residential mortgage | First lien | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total Loans | 150,173 | 139,851 |
Residential mortgage | Home equity - term | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total Loans | 13,019 | 14,248 |
Residential mortgage | Home equity - lines of credit | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total Loans | 127,262 | 120,353 |
Installment and other loans | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total Loans | $ 7,370 | $ 7,118 |
LOANS AND ALLOWANCE FOR LOAN 35
LOANS AND ALLOWANCE FOR LOAN LOSSES - Bank's Ratings Based on its Internal Risk Rating System (Detail) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | $ 934,382 | $ 883,391 |
Commercial real estate | Owner-occupied | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 116,419 | 112,295 |
Commercial real estate | Non-owner occupied | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 217,070 | 206,358 |
Commercial real estate | Multi-family | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 48,637 | 47,681 |
Commercial real estate | Non-owner occupied residential | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 68,621 | 62,533 |
Acquisition and development | 1-4 family residential construction | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 8,036 | 4,663 |
Acquisition and development | Commercial and land development | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 28,481 | 26,085 |
Commercial and industrial | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 97,913 | 88,465 |
Municipal | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 51,381 | 53,741 |
Residential mortgage | First lien | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 150,173 | 139,851 |
Residential mortgage | Home equity - term | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 13,019 | 14,248 |
Residential mortgage | Home equity - lines of credit | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 127,262 | 120,353 |
Installment and other loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 7,370 | 7,118 |
Pass | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 901,714 | 844,663 |
Pass | Commercial real estate | Owner-occupied | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 111,737 | 103,652 |
Pass | Commercial real estate | Non-owner occupied | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 206,823 | 190,726 |
Pass | Commercial real estate | Multi-family | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 43,526 | 42,473 |
Pass | Commercial real estate | Non-owner occupied residential | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 66,024 | 59,982 |
Pass | Acquisition and development | 1-4 family residential construction | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 8,036 | 4,560 |
Pass | Acquisition and development | Commercial and land development | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 27,849 | 25,435 |
Pass | Commercial and industrial | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 95,124 | 87,588 |
Pass | Municipal | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 49,392 | 53,741 |
Pass | Residential mortgage | First lien | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 146,200 | 135,558 |
Pass | Residential mortgage | Home equity - term | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 12,994 | 14,155 |
Pass | Residential mortgage | Home equity - lines of credit | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 126,648 | 119,681 |
Pass | Installment and other loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 7,361 | 7,112 |
Special Mention | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 11,692 | 15,830 |
Special Mention | Commercial real estate | Owner-occupied | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 1,814 | 5,422 |
Special Mention | Commercial real estate | Non-owner occupied | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 196 | 4,791 |
Special Mention | Commercial real estate | Multi-family | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 4,159 | 4,222 |
Special Mention | Commercial real estate | Non-owner occupied residential | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 1,062 | 949 |
Special Mention | Acquisition and development | 1-4 family residential construction | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 103 |
Special Mention | Acquisition and development | Commercial and land development | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 7 | 10 |
Special Mention | Commercial and industrial | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 2,384 | 251 |
Special Mention | Municipal | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 1,989 | 0 |
Special Mention | Residential mortgage | First lien | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 0 |
Special Mention | Residential mortgage | Home equity - term | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 0 |
Special Mention | Residential mortgage | Home equity - lines of credit | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 81 | 82 |
Special Mention | Installment and other loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 0 |
Non-Impaired Substandard | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 14,612 | 14,925 |
Non-Impaired Substandard | Commercial real estate | Owner-occupied | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 1,959 | 2,151 |
Non-Impaired Substandard | Commercial real estate | Non-owner occupied | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 10,051 | 10,105 |
Non-Impaired Substandard | Commercial real estate | Multi-family | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 770 | 787 |
Non-Impaired Substandard | Commercial real estate | Non-owner occupied residential | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 1,117 | 1,150 |
Non-Impaired Substandard | Acquisition and development | 1-4 family residential construction | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 0 |
Non-Impaired Substandard | Acquisition and development | Commercial and land development | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 625 | 639 |
Non-Impaired Substandard | Commercial and industrial | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 29 | 32 |
Non-Impaired Substandard | Municipal | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 0 |
Non-Impaired Substandard | Residential mortgage | First lien | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 0 |
Non-Impaired Substandard | Residential mortgage | Home equity - term | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 0 |
Non-Impaired Substandard | Residential mortgage | Home equity - lines of credit | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 61 | 61 |
Non-Impaired Substandard | Installment and other loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 0 |
Impaired - Substandard | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 6,364 | 7,973 |
Impaired - Substandard | Commercial real estate | Owner-occupied | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 909 | 1,070 |
Impaired - Substandard | Commercial real estate | Non-owner occupied | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 736 |
Impaired - Substandard | Commercial real estate | Multi-family | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 182 | 199 |
Impaired - Substandard | Commercial real estate | Non-owner occupied residential | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 418 | 452 |
Impaired - Substandard | Acquisition and development | 1-4 family residential construction | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 0 |
Impaired - Substandard | Acquisition and development | Commercial and land development | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 1 |
Impaired - Substandard | Commercial and industrial | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 376 | 594 |
Impaired - Substandard | Municipal | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 0 |
Impaired - Substandard | Residential mortgage | First lien | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 3,973 | 4,293 |
Impaired - Substandard | Residential mortgage | Home equity - term | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 25 | 93 |
Impaired - Substandard | Residential mortgage | Home equity - lines of credit | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 472 | 529 |
Impaired - Substandard | Installment and other loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 9 | 6 |
Doubtful | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 0 |
Doubtful | Commercial real estate | Owner-occupied | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 0 |
Doubtful | Commercial real estate | Non-owner occupied | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 0 |
Doubtful | Commercial real estate | Multi-family | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 0 |
Doubtful | Commercial real estate | Non-owner occupied residential | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 0 |
Doubtful | Acquisition and development | 1-4 family residential construction | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 0 |
Doubtful | Acquisition and development | Commercial and land development | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 0 |
Doubtful | Commercial and industrial | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 0 |
Doubtful | Municipal | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 0 |
Doubtful | Residential mortgage | First lien | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 0 |
Doubtful | Residential mortgage | Home equity - term | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 0 |
Doubtful | Residential mortgage | Home equity - lines of credit | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | 0 | 0 |
Doubtful | Installment and other loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total Loans | $ 0 | $ 0 |
LOANS AND ALLOWANCE FOR LOAN 36
LOANS AND ALLOWANCE FOR LOAN LOSSES - Impaired Loans by Class (Detail) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Financing Receivable, Impaired [Line Items] | ||
Impaired Loans with a Specific Allowance, Recorded Investment (Book Balance) | $ 558 | $ 643 |
Impaired Loans with a Specific Allowance, Unpaid Principal Balance (Legal Balance) | 558 | 643 |
Impaired Loans with a Specific Allowance, Related Allowance | 45 | 43 |
Impaired Loans with No Specific Allowance, Recorded Investment (Book Balance) | 5,806 | 7,330 |
Impaired Loans with No Specific Allowance, Unpaid Principal Balance (Legal Balance) | 8,430 | 10,559 |
Commercial real estate | Owner-occupied | ||
Financing Receivable, Impaired [Line Items] | ||
Impaired Loans with a Specific Allowance, Recorded Investment (Book Balance) | 0 | 0 |
Impaired Loans with a Specific Allowance, Unpaid Principal Balance (Legal Balance) | 0 | 0 |
Impaired Loans with a Specific Allowance, Related Allowance | 0 | 0 |
Impaired Loans with No Specific Allowance, Recorded Investment (Book Balance) | 909 | 1,070 |
Impaired Loans with No Specific Allowance, Unpaid Principal Balance (Legal Balance) | 2,098 | 2,236 |
Commercial real estate | Non-owner occupied | ||
Financing Receivable, Impaired [Line Items] | ||
Impaired Loans with a Specific Allowance, Recorded Investment (Book Balance) | 0 | |
Impaired Loans with a Specific Allowance, Unpaid Principal Balance (Legal Balance) | 0 | |
Impaired Loans with a Specific Allowance, Related Allowance | 0 | |
Impaired Loans with No Specific Allowance, Recorded Investment (Book Balance) | 736 | |
Impaired Loans with No Specific Allowance, Unpaid Principal Balance (Legal Balance) | 1,323 | |
Commercial real estate | Multi-family | ||
Financing Receivable, Impaired [Line Items] | ||
Impaired Loans with a Specific Allowance, Recorded Investment (Book Balance) | 0 | 0 |
Impaired Loans with a Specific Allowance, Unpaid Principal Balance (Legal Balance) | 0 | 0 |
Impaired Loans with a Specific Allowance, Related Allowance | 0 | 0 |
Impaired Loans with No Specific Allowance, Recorded Investment (Book Balance) | 182 | 199 |
Impaired Loans with No Specific Allowance, Unpaid Principal Balance (Legal Balance) | 360 | 368 |
Commercial real estate | Non-owner occupied residential | ||
Financing Receivable, Impaired [Line Items] | ||
Impaired Loans with a Specific Allowance, Recorded Investment (Book Balance) | 0 | 0 |
Impaired Loans with a Specific Allowance, Unpaid Principal Balance (Legal Balance) | 0 | 0 |
Impaired Loans with a Specific Allowance, Related Allowance | 0 | 0 |
Impaired Loans with No Specific Allowance, Recorded Investment (Book Balance) | 418 | 452 |
Impaired Loans with No Specific Allowance, Unpaid Principal Balance (Legal Balance) | 688 | 706 |
Acquisition and development | Commercial and land development | ||
Financing Receivable, Impaired [Line Items] | ||
Impaired Loans with a Specific Allowance, Recorded Investment (Book Balance) | 0 | |
Impaired Loans with a Specific Allowance, Unpaid Principal Balance (Legal Balance) | 0 | |
Impaired Loans with a Specific Allowance, Related Allowance | 0 | |
Impaired Loans with No Specific Allowance, Recorded Investment (Book Balance) | 1 | |
Impaired Loans with No Specific Allowance, Unpaid Principal Balance (Legal Balance) | 16 | |
Commercial and industrial | ||
Financing Receivable, Impaired [Line Items] | ||
Impaired Loans with a Specific Allowance, Recorded Investment (Book Balance) | 0 | 0 |
Impaired Loans with a Specific Allowance, Unpaid Principal Balance (Legal Balance) | 0 | 0 |
Impaired Loans with a Specific Allowance, Related Allowance | 0 | 0 |
Impaired Loans with No Specific Allowance, Recorded Investment (Book Balance) | 376 | 594 |
Impaired Loans with No Specific Allowance, Unpaid Principal Balance (Legal Balance) | 508 | 715 |
Residential mortgage | First lien | ||
Financing Receivable, Impaired [Line Items] | ||
Impaired Loans with a Specific Allowance, Recorded Investment (Book Balance) | 553 | 643 |
Impaired Loans with a Specific Allowance, Unpaid Principal Balance (Legal Balance) | 553 | 643 |
Impaired Loans with a Specific Allowance, Related Allowance | 40 | 43 |
Impaired Loans with No Specific Allowance, Recorded Investment (Book Balance) | 3,420 | 3,650 |
Impaired Loans with No Specific Allowance, Unpaid Principal Balance (Legal Balance) | 4,101 | 4,399 |
Residential mortgage | Home equity - term | ||
Financing Receivable, Impaired [Line Items] | ||
Impaired Loans with a Specific Allowance, Recorded Investment (Book Balance) | 0 | 0 |
Impaired Loans with a Specific Allowance, Unpaid Principal Balance (Legal Balance) | 0 | 0 |
Impaired Loans with a Specific Allowance, Related Allowance | 0 | 0 |
Impaired Loans with No Specific Allowance, Recorded Investment (Book Balance) | 25 | 93 |
Impaired Loans with No Specific Allowance, Unpaid Principal Balance (Legal Balance) | 29 | 103 |
Residential mortgage | Home equity - lines of credit | ||
Financing Receivable, Impaired [Line Items] | ||
Impaired Loans with a Specific Allowance, Recorded Investment (Book Balance) | 0 | 0 |
Impaired Loans with a Specific Allowance, Unpaid Principal Balance (Legal Balance) | 0 | 0 |
Impaired Loans with a Specific Allowance, Related Allowance | 0 | 0 |
Impaired Loans with No Specific Allowance, Recorded Investment (Book Balance) | 472 | 529 |
Impaired Loans with No Specific Allowance, Unpaid Principal Balance (Legal Balance) | 613 | 659 |
Installment and other loans | ||
Financing Receivable, Impaired [Line Items] | ||
Impaired Loans with a Specific Allowance, Recorded Investment (Book Balance) | 5 | 0 |
Impaired Loans with a Specific Allowance, Unpaid Principal Balance (Legal Balance) | 5 | 0 |
Impaired Loans with a Specific Allowance, Related Allowance | 5 | 0 |
Impaired Loans with No Specific Allowance, Recorded Investment (Book Balance) | 4 | 6 |
Impaired Loans with No Specific Allowance, Unpaid Principal Balance (Legal Balance) | $ 33 | $ 34 |
LOANS AND ALLOWANCE FOR LOAN 37
LOANS AND ALLOWANCE FOR LOAN LOSSES - Average Recorded Investment in Impaired Loans and Related Interest Income (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Financing Receivable, Impaired [Line Items] | ||||
Average Impaired Balance | $ 6,775 | $ 15,871 | $ 7,276 | $ 16,515 |
Interest Income Recognized | 27 | 8 | 35 | 17 |
Commercial real estate | Owner-occupied | ||||
Financing Receivable, Impaired [Line Items] | ||||
Average Impaired Balance | 979 | 1,954 | 1,036 | 2,012 |
Interest Income Recognized | 5 | 0 | 5 | 0 |
Commercial real estate | Non-owner occupied | ||||
Financing Receivable, Impaired [Line Items] | ||||
Average Impaired Balance | 0 | 7,251 | 276 | 7,511 |
Interest Income Recognized | 0 | 0 | 0 | 0 |
Commercial real estate | Multi-family | ||||
Financing Receivable, Impaired [Line Items] | ||||
Average Impaired Balance | 186 | 221 | 191 | 225 |
Interest Income Recognized | 0 | 0 | 0 | 0 |
Commercial real estate | Non-owner occupied residential | ||||
Financing Receivable, Impaired [Line Items] | ||||
Average Impaired Balance | 427 | 699 | 437 | 787 |
Interest Income Recognized | 0 | 0 | 0 | 0 |
Acquisition and development | Commercial and land development | ||||
Financing Receivable, Impaired [Line Items] | ||||
Average Impaired Balance | 0 | 3 | 0 | 4 |
Interest Income Recognized | 0 | 0 | 0 | 0 |
Commercial and industrial | ||||
Financing Receivable, Impaired [Line Items] | ||||
Average Impaired Balance | 404 | 514 | 458 | 619 |
Interest Income Recognized | 0 | 0 | 0 | 0 |
Residential mortgage | First lien | ||||
Financing Receivable, Impaired [Line Items] | ||||
Average Impaired Balance | 4,192 | 4,618 | 4,272 | 4,697 |
Interest Income Recognized | 21 | 8 | 29 | 17 |
Residential mortgage | Home equity - term | ||||
Financing Receivable, Impaired [Line Items] | ||||
Average Impaired Balance | 78 | 98 | 87 | 100 |
Interest Income Recognized | 0 | 0 | 0 | 0 |
Residential mortgage | Home equity - lines of credit | ||||
Financing Receivable, Impaired [Line Items] | ||||
Average Impaired Balance | 503 | 499 | 513 | 544 |
Interest Income Recognized | 1 | 0 | 1 | 0 |
Installment and other loans | ||||
Financing Receivable, Impaired [Line Items] | ||||
Average Impaired Balance | 6 | 14 | 6 | 16 |
Interest Income Recognized | $ 0 | $ 0 | $ 0 | $ 0 |
LOANS AND ALLOWANCE FOR LOAN 38
LOANS AND ALLOWANCE FOR LOAN LOSSES - Troubled Debt Restructurings (Detail) $ in Thousands | Jun. 30, 2017USD ($)contract | Dec. 31, 2016USD ($)contract |
Financing Receivable, Modifications [Line Items] | ||
Number of Contracts | contract | 23 | 22 |
Recorded Investment | $ | $ 2,015 | $ 1,971 |
Accruing | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Contracts | contract | 13 | 9 |
Recorded Investment | $ | $ 1,204 | $ 930 |
Nonaccruing | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Contracts | contract | 10 | 13 |
Recorded Investment | $ | $ 811 | $ 1,041 |
Commercial real estate | Accruing | Owner-occupied | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Contracts | contract | 1 | 0 |
Recorded Investment | $ | $ 56 | $ 0 |
Commercial real estate | Nonaccruing | Owner-occupied | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Contracts | contract | 1 | 0 |
Recorded Investment | $ | $ 61 | $ 0 |
Residential mortgage | Accruing | First lien | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Contracts | contract | 11 | 8 |
Recorded Investment | $ | $ 1,116 | $ 896 |
Residential mortgage | Accruing | Home equity - lines of credit | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Contracts | contract | 1 | 1 |
Recorded Investment | $ | $ 32 | $ 34 |
Residential mortgage | Nonaccruing | First lien | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Contracts | contract | 8 | 12 |
Recorded Investment | $ | $ 746 | $ 1,035 |
Installment and other loans | Nonaccruing | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Contracts | contract | 1 | 1 |
Recorded Investment | $ | $ 4 | $ 6 |
LOANS AND ALLOWANCE FOR LOAN 39
LOANS AND ALLOWANCE FOR LOAN LOSSES - Number of Loans Modified and Their Pre-Modification and Post-Modification Investment Balances (Detail) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017USD ($)contract | Jun. 30, 2016USD ($)contract | Jun. 30, 2017USD ($)contract | Jun. 30, 2016USD ($)contract | |
Financing Receivable, Modifications [Line Items] | ||||
Number of Contracts | contract | 2 | 1 | ||
Pre- Modification Recorded Investment | $ 119 | $ 257 | ||
Post Modification Recorded Investment | $ 119 | $ 257 | ||
Commercial real estate | Owner-occupied | ||||
Financing Receivable, Modifications [Line Items] | ||||
Number of Contracts | contract | 1 | 0 | 2 | 0 |
Pre- Modification Recorded Investment | $ 56 | $ 0 | $ 119 | $ 0 |
Post Modification Recorded Investment | $ 56 | $ 0 | $ 119 | $ 0 |
Residential mortgage | First lien | ||||
Financing Receivable, Modifications [Line Items] | ||||
Number of Contracts | contract | 0 | 1 | ||
Pre- Modification Recorded Investment | $ 0 | $ 257 | ||
Post Modification Recorded Investment | $ 0 | $ 257 |
LOANS AND ALLOWANCE FOR LOAN 40
LOANS AND ALLOWANCE FOR LOAN LOSSES - Loan Portfolio Summarized by Aging Categories of Performing Loans and Nonaccrual Loans (Detail) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Current | $ 928,153 | $ 875,131 |
Past Due | 1,069 | 1,218 |
90+ (still accruing) Days Past Due | 0 | 0 |
Non- Accrual | 5,160 | 7,042 |
Total Loans | 934,382 | 883,391 |
30 to 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 1,007 | 888 |
60 to 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 62 | 330 |
Commercial real estate | Owner-occupied | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Current | 115,561 | 111,225 |
Past Due | 5 | 0 |
90+ (still accruing) Days Past Due | 0 | 0 |
Non- Accrual | 853 | 1,070 |
Total Loans | 116,419 | 112,295 |
Commercial real estate | Owner-occupied | 30 to 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 5 | 0 |
Commercial real estate | Owner-occupied | 60 to 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 0 | 0 |
Commercial real estate | Non-owner occupied | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Current | 217,070 | 205,622 |
Past Due | 0 | 0 |
90+ (still accruing) Days Past Due | 0 | 0 |
Non- Accrual | 0 | 736 |
Total Loans | 217,070 | 206,358 |
Commercial real estate | Non-owner occupied | 30 to 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 0 | 0 |
Commercial real estate | Non-owner occupied | 60 to 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 0 | 0 |
Commercial real estate | Multi-family | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Current | 48,455 | 47,482 |
Past Due | 0 | 0 |
90+ (still accruing) Days Past Due | 0 | 0 |
Non- Accrual | 182 | 199 |
Total Loans | 48,637 | 47,681 |
Commercial real estate | Multi-family | 30 to 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 0 | 0 |
Commercial real estate | Multi-family | 60 to 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 0 | 0 |
Commercial real estate | Non-owner occupied residential | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Current | 68,203 | 62,081 |
Past Due | 0 | 0 |
90+ (still accruing) Days Past Due | 0 | 0 |
Non- Accrual | 418 | 452 |
Total Loans | 68,621 | 62,533 |
Commercial real estate | Non-owner occupied residential | 30 to 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 0 | 0 |
Commercial real estate | Non-owner occupied residential | 60 to 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 0 | 0 |
Acquisition and development | 1-4 family residential construction | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Current | 8,036 | 4,548 |
Past Due | 0 | 115 |
90+ (still accruing) Days Past Due | 0 | 0 |
Non- Accrual | 0 | 0 |
Total Loans | 8,036 | 4,663 |
Acquisition and development | 1-4 family residential construction | 30 to 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 0 | 115 |
Acquisition and development | 1-4 family residential construction | 60 to 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 0 | 0 |
Acquisition and development | Commercial and land development | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Current | 28,418 | 26,084 |
Past Due | 63 | 0 |
90+ (still accruing) Days Past Due | 0 | 0 |
Non- Accrual | 0 | 1 |
Total Loans | 28,481 | 26,085 |
Acquisition and development | Commercial and land development | 30 to 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 63 | 0 |
Acquisition and development | Commercial and land development | 60 to 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 0 | 0 |
Commercial and industrial | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Current | 97,507 | 87,871 |
Past Due | 30 | 0 |
90+ (still accruing) Days Past Due | 0 | 0 |
Non- Accrual | 376 | 594 |
Total Loans | 97,913 | 88,465 |
Commercial and industrial | 30 to 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 30 | 0 |
Commercial and industrial | 60 to 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 0 | 0 |
Municipal | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Current | 51,381 | 53,741 |
Past Due | 0 | 0 |
90+ (still accruing) Days Past Due | 0 | 0 |
Non- Accrual | 0 | 0 |
Total Loans | 51,381 | 53,741 |
Municipal | 30 to 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 0 | 0 |
Municipal | 60 to 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 0 | 0 |
Residential mortgage | First lien | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Current | 146,712 | 135,499 |
Past Due | 604 | 956 |
90+ (still accruing) Days Past Due | 0 | 0 |
Non- Accrual | 2,857 | 3,396 |
Total Loans | 150,173 | 139,851 |
Residential mortgage | First lien | 30 to 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 583 | 628 |
Residential mortgage | First lien | 60 to 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 21 | 328 |
Residential mortgage | Home equity - term | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Current | 12,964 | 14,155 |
Past Due | 30 | 0 |
90+ (still accruing) Days Past Due | 0 | 0 |
Non- Accrual | 25 | 93 |
Total Loans | 13,019 | 14,248 |
Residential mortgage | Home equity - term | 30 to 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 30 | 0 |
Residential mortgage | Home equity - term | 60 to 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 0 | 0 |
Residential mortgage | Home equity - lines of credit | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Current | 126,497 | 119,733 |
Past Due | 325 | 125 |
90+ (still accruing) Days Past Due | 0 | 0 |
Non- Accrual | 440 | 495 |
Total Loans | 127,262 | 120,353 |
Residential mortgage | Home equity - lines of credit | 30 to 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 288 | 125 |
Residential mortgage | Home equity - lines of credit | 60 to 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 37 | 0 |
Installment and other loans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Current | 7,349 | 7,090 |
Past Due | 12 | 22 |
90+ (still accruing) Days Past Due | 0 | 0 |
Non- Accrual | 9 | 6 |
Total Loans | 7,370 | 7,118 |
Installment and other loans | 30 to 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | 8 | 20 |
Installment and other loans | 60 to 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past Due | $ 4 | $ 2 |
LOANS AND ALLOWANCE FOR LOAN 41
LOANS AND ALLOWANCE FOR LOAN LOSSES - Activity in Allowance for Loan Losses (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Activity in allowance for loan losses | ||||
Balance, beginning of period | $ 12,668 | $ 13,347 | $ 12,775 | $ 13,568 |
Provision for loan losses | 100 | 0 | 100 | 0 |
Charge-offs | (78) | (154) | (207) | (483) |
Recoveries | 61 | 247 | 83 | 355 |
Balance, end of period | 12,751 | 13,440 | 12,751 | 13,440 |
Unallocated | ||||
Activity in allowance for loan losses | ||||
Balance, beginning of period | 512 | 664 | 414 | 774 |
Provision for loan losses | (42) | (39) | 56 | (149) |
Charge-offs | 0 | 0 | 0 | 0 |
Recoveries | 0 | 0 | 0 | 0 |
Balance, end of period | 470 | 625 | 470 | 625 |
Commercial | ||||
Activity in allowance for loan losses | ||||
Balance, beginning of period | 8,800 | 9,827 | 9,238 | 9,803 |
Provision for loan losses | (69) | (53) | (411) | (90) |
Charge-offs | 0 | (26) | (100) | (47) |
Recoveries | 33 | 181 | 37 | 263 |
Balance, end of period | 8,764 | 9,929 | 8,764 | 9,929 |
Commercial | Commercial Real Estate | ||||
Activity in allowance for loan losses | ||||
Balance, beginning of period | 6,963 | 7,996 | 7,530 | 7,883 |
Provision for loan losses | (214) | (12) | (738) | 21 |
Charge-offs | 0 | (26) | (45) | (26) |
Recoveries | 28 | 175 | 30 | 255 |
Balance, end of period | 6,777 | 8,133 | 6,777 | 8,133 |
Commercial | Acquisition and Development | ||||
Activity in allowance for loan losses | ||||
Balance, beginning of period | 513 | 739 | 580 | 850 |
Provision for loan losses | 65 | (152) | (3) | (263) |
Charge-offs | 0 | 0 | 0 | 0 |
Recoveries | 1 | 0 | 2 | 0 |
Balance, end of period | 579 | 587 | 579 | 587 |
Commercial | Commercial and Industrial | ||||
Activity in allowance for loan losses | ||||
Balance, beginning of period | 1,218 | 1,030 | 1,074 | 1,012 |
Provision for loan losses | 69 | 112 | 267 | 149 |
Charge-offs | 0 | 0 | (55) | (21) |
Recoveries | 4 | 6 | 5 | 8 |
Balance, end of period | 1,291 | 1,148 | 1,291 | 1,148 |
Commercial | Municipal | ||||
Activity in allowance for loan losses | ||||
Balance, beginning of period | 106 | 62 | 54 | 58 |
Provision for loan losses | 11 | (1) | 63 | 3 |
Charge-offs | 0 | 0 | 0 | 0 |
Recoveries | 0 | 0 | 0 | 0 |
Balance, end of period | 117 | 61 | 117 | 61 |
Consumer | ||||
Activity in allowance for loan losses | ||||
Balance, beginning of period | 3,356 | 2,856 | 3,123 | 2,991 |
Provision for loan losses | 211 | 92 | 455 | 239 |
Charge-offs | (78) | (128) | (107) | (436) |
Recoveries | 28 | 66 | 46 | 92 |
Balance, end of period | 3,517 | 2,886 | 3,517 | 2,886 |
Consumer | Residential Mortgage | ||||
Activity in allowance for loan losses | ||||
Balance, beginning of period | 3,229 | 2,677 | 2,979 | 2,870 |
Provision for loan losses | 198 | 66 | 441 | 111 |
Charge-offs | (51) | (80) | (51) | (324) |
Recoveries | 10 | 43 | 17 | 49 |
Balance, end of period | 3,386 | 2,706 | 3,386 | 2,706 |
Consumer | Installment and Other | ||||
Activity in allowance for loan losses | ||||
Balance, beginning of period | 127 | 179 | 144 | 121 |
Provision for loan losses | 13 | 26 | 14 | 128 |
Charge-offs | (27) | (48) | (56) | (112) |
Recoveries | 18 | 23 | 29 | 43 |
Balance, end of period | $ 131 | $ 180 | $ 131 | $ 180 |
LOANS AND ALLOWANCE FOR LOAN 42
LOANS AND ALLOWANCE FOR LOAN LOSSES - Summary of Ending Loan Balances Evaluated for Impairment and Related Allowance for Loan Losses Allocation (Detail) - USD ($) $ in Thousands | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 |
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||||
Loans, Individually evaluated for impairment | $ 6,364 | $ 7,973 | ||||
Loans, Collectively evaluated for impairment | 928,018 | 875,418 | ||||
Total Loans | 934,382 | 883,391 | ||||
Allowance for loan losses, Individually evaluated for impairment | 45 | 43 | ||||
Allowance for loan losses, Collectively evaluated for impairment | 12,706 | 12,732 | ||||
Allowance for loan losses, Total | 12,751 | $ 12,668 | 12,775 | $ 13,440 | $ 13,347 | $ 13,568 |
Commercial and Industrial | ||||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||||
Total Loans | 97,913 | 88,465 | ||||
Municipal | ||||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||||
Total Loans | 51,381 | 53,741 | ||||
Installment and Other | ||||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||||
Total Loans | 7,370 | 7,118 | ||||
Commercial | ||||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||||
Loans, Individually evaluated for impairment | 1,885 | 3,052 | ||||
Loans, Collectively evaluated for impairment | 634,673 | 598,769 | ||||
Total Loans | 636,558 | 601,821 | ||||
Allowance for loan losses, Individually evaluated for impairment | 0 | 0 | ||||
Allowance for loan losses, Collectively evaluated for impairment | 8,764 | 9,238 | ||||
Allowance for loan losses, Total | 8,764 | 9,238 | ||||
Commercial | Commercial Real Estate | ||||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||||
Loans, Individually evaluated for impairment | 1,509 | 2,457 | ||||
Loans, Collectively evaluated for impairment | 449,238 | 426,410 | ||||
Total Loans | 450,747 | 428,867 | ||||
Allowance for loan losses, Individually evaluated for impairment | 0 | 0 | ||||
Allowance for loan losses, Collectively evaluated for impairment | 6,777 | 7,530 | ||||
Allowance for loan losses, Total | 6,777 | 7,530 | ||||
Commercial | Acquisition and Development | ||||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||||
Loans, Individually evaluated for impairment | 0 | 1 | ||||
Loans, Collectively evaluated for impairment | 36,517 | 30,747 | ||||
Total Loans | 36,517 | 30,748 | ||||
Allowance for loan losses, Individually evaluated for impairment | 0 | 0 | ||||
Allowance for loan losses, Collectively evaluated for impairment | 579 | 580 | ||||
Allowance for loan losses, Total | 579 | 580 | ||||
Commercial | Commercial and Industrial | ||||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||||
Loans, Individually evaluated for impairment | 376 | 594 | ||||
Loans, Collectively evaluated for impairment | 97,537 | 87,871 | ||||
Total Loans | 97,913 | 88,465 | ||||
Allowance for loan losses, Individually evaluated for impairment | 0 | 0 | ||||
Allowance for loan losses, Collectively evaluated for impairment | 1,291 | 1,074 | ||||
Allowance for loan losses, Total | 1,291 | 1,074 | ||||
Commercial | Municipal | ||||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||||
Loans, Individually evaluated for impairment | 0 | 0 | ||||
Loans, Collectively evaluated for impairment | 51,381 | 53,741 | ||||
Total Loans | 51,381 | 53,741 | ||||
Allowance for loan losses, Individually evaluated for impairment | 0 | 0 | ||||
Allowance for loan losses, Collectively evaluated for impairment | 117 | 54 | ||||
Allowance for loan losses, Total | 117 | 54 | ||||
Consumer | ||||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||||
Loans, Individually evaluated for impairment | 4,479 | 4,921 | ||||
Loans, Collectively evaluated for impairment | 293,345 | 276,649 | ||||
Total Loans | 297,824 | 281,570 | ||||
Allowance for loan losses, Individually evaluated for impairment | 45 | 43 | ||||
Allowance for loan losses, Collectively evaluated for impairment | 3,472 | 3,080 | ||||
Allowance for loan losses, Total | 3,517 | 3,123 | ||||
Consumer | Residential Mortgage | ||||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||||
Loans, Individually evaluated for impairment | 4,470 | 4,915 | ||||
Loans, Collectively evaluated for impairment | 285,984 | 269,537 | ||||
Total Loans | 290,454 | 274,452 | ||||
Allowance for loan losses, Individually evaluated for impairment | 40 | 43 | ||||
Allowance for loan losses, Collectively evaluated for impairment | 3,346 | 2,936 | ||||
Allowance for loan losses, Total | 3,386 | 2,979 | ||||
Consumer | Installment and Other | ||||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||||
Loans, Individually evaluated for impairment | 9 | 6 | ||||
Loans, Collectively evaluated for impairment | 7,361 | 7,112 | ||||
Total Loans | 7,370 | 7,118 | ||||
Allowance for loan losses, Individually evaluated for impairment | 5 | 0 | ||||
Allowance for loan losses, Collectively evaluated for impairment | 126 | 144 | ||||
Allowance for loan losses, Total | 131 | 144 | ||||
Unallocated | ||||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||||
Loans, Individually evaluated for impairment | 0 | 0 | ||||
Loans, Collectively evaluated for impairment | 0 | 0 | ||||
Total Loans | 0 | 0 | ||||
Allowance for loan losses, Individually evaluated for impairment | 0 | 0 | ||||
Allowance for loan losses, Collectively evaluated for impairment | 470 | 414 | ||||
Allowance for loan losses, Total | $ 470 | $ 414 |
INCOME TAXES - Components of In
INCOME TAXES - Components of Income Tax Expenses (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Current year expense (benefit): | ||||
Federal | $ 145 | $ 238 | $ 202 | $ 126 |
State | (9) | (1) | (7) | (3) |
Current year expense (benefit) | 136 | 237 | 195 | 123 |
Deferred expense: | ||||
Federal | 371 | 10 | 735 | 732 |
State | 9 | 5 | 10 | 11 |
Deferred tax expense | 380 | 15 | 745 | 743 |
Income tax expense | $ 516 | $ 252 | $ 940 | $ 866 |
INCOME TAXES - Additional Infor
INCOME TAXES - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2017 | Sep. 30, 2016 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Income Tax Disclosure [Abstract] | |||||
Income tax expense related to net securities gains | $ 222 | $ 0 | $ 223 | $ 497 | |
Federal statutory rate | 34.00% | 34.00% | 35.00% |
INCOME TAXES - Components of Ne
INCOME TAXES - Components of Net Deferred Tax Asset (Detail) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Deferred tax assets: | ||
Allowance for loan losses | $ 4,719 | $ 4,725 |
Deferred compensation | 548 | 545 |
Retirement plans and salary continuation | 2,018 | 1,942 |
Share-based compensation | 730 | 583 |
Off-balance sheet reserves | 337 | 313 |
Nonaccrual loan interest | 466 | 370 |
Net unrealized losses on securities available for sale | 0 | 600 |
Goodwill | 77 | 92 |
Bonus accrual | 321 | 236 |
Low-income housing credit carryforward | 2,148 | 1,983 |
Alternative minimum tax credit carryforward | 4,348 | 4,048 |
Net operating loss carryforward | 804 | 2,520 |
Other | 523 | 479 |
Total deferred tax assets | 17,039 | 18,436 |
Deferred tax liabilities: | ||
Depreciation | 694 | 771 |
Net unrealized gains on securities available for sale | 1,472 | 0 |
Mortgage servicing rights | 814 | 777 |
Purchase accounting adjustments | 420 | 435 |
Other | 198 | 195 |
Total deferred tax liabilities | 3,598 | 2,178 |
Net deferred tax asset | $ 13,441 | $ 16,258 |
SHARE-BASED COMPENSATION PLAN46
SHARE-BASED COMPENSATION PLANS - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Mar. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Issuance of treasury stock, shares | 53,367 | 2,461 | ||||
Orrstown 2011 Incentive Stock Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of shares reserved to be issued | 381,920 | 381,920 | ||||
Number of shares available to be issued under employee stock purchase plan | 81,890 | 81,890 | ||||
Orrstown 2011 Incentive Stock Plan | Restricted Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted share award expense | $ 363 | $ 259 | $ 659 | $ 496 | ||
Restricted share award tax benefit | 123 | $ 91 | 224 | $ 174 | ||
Unrecognized compensation expense | $ 2,660 | $ 2,660 | $ 2,169 | |||
Unrecognized compensation expense, recognition period | 2 years 1 month 10 days | |||||
Orrstown 2011 Incentive Stock Plan | Employee Stock Option | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Intrinsic value of options outstanding and exercisable | $ 52 | $ 39 | ||||
Orrstown 2011 Incentive Stock Plan | Employee Stock Option | Maximum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Maximum term to exercise option | 10 years | |||||
Employee Stock Purchase Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of shares reserved to be issued | 350,000 | 350,000 | ||||
Number of shares available to be issued under employee stock purchase plan | 182,890 | 182,890 | ||||
Maximum shares purchase, as percentage of salary | 10.00% | 10.00% | ||||
Percentage of value of the shares on the semi-annual offering | 95.00% | |||||
Issuance of treasury stock, shares | 0 | 0 | 3,114 | 2,461 | ||
Weighted average price of shares purchased | $ 0 | $ 0 | $ 19.71 | $ 16.57 | ||
Compensation expense recognized | $ 0 | $ 0 | $ 7 | $ 3 |
SHARE-BASED COMPENSATION PLAN47
SHARE-BASED COMPENSATION PLANS - Summary of Outstanding Nonvested Restricted Shares (Details) - Orrstown 2011 Incentive Stock Plan - Restricted Stock | 6 Months Ended |
Jun. 30, 2017$ / sharesshares | |
Shares | |
Nonvested shares, beginning of year (in shares) | shares | 227,337 |
Granted (in shares) | shares | 62,253 |
Forfeited (in shares) | shares | (7,192) |
Vested (in usd per share) | shares | (12,000) |
Nonvested shares, at period end (in shares) | shares | 270,398 |
Weighted Average Grant Date Fair Value | |
Nonvested shares, beginning of year (in usd per share) | $ / shares | $ 16.88 |
Granted (in usd per share) | $ / shares | 22.26 |
Forfeited (in usd per share) | $ / shares | 18.31 |
Vested (in usd per share) | $ / shares | 17.95 |
Nonvested shares, at period end (in usd per share) | $ / shares | $ 18.04 |
SHARE-BASED COMPENSATION PLAN48
SHARE-BASED COMPENSATION PLANS - Schedule of Restricted Stock Award Expense (Details) - Orrstown 2011 Incentive Stock Plan - Restricted Stock - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Restricted share award expense | $ 363 | $ 259 | $ 659 | $ 496 |
Restricted share award tax benefit | 123 | 91 | 224 | 174 |
Fair value of shares vested | $ 263 | $ 193 | $ 263 | $ 237 |
SHARE-BASED COMPENSATION PLAN49
SHARE-BASED COMPENSATION PLANS - Summary of Outstanding Stock Options (Detail) - Orrstown 2011 Incentive Stock Plan - Employee Stock Option | 6 Months Ended |
Jun. 30, 2017$ / sharesshares | |
Shares | |
Outstanding at beginning of year (in shares) | shares | 80,370 |
Forfeited (in shares) | shares | (1,100) |
Expired (in shares) | shares | (3,087) |
Options outstanding and exercisable, at period end (in shares) | shares | 76,183 |
Weighted Average Exercise Price | |
Outstanding at beginning of year (in usd per share) | $ / shares | $ 27.37 |
Forfeited (in usd per share) | $ / shares | 21.14 |
Expired (in usd per share) | $ / shares | 33.98 |
Options outstanding and exercisable, at period end (in usd per share) | $ / shares | $ 27.19 |
SHARE-BASED COMPENSATION PLAN50
SHARE-BASED COMPENSATION PLANS - Information Pertaining to Options Outstanding and Exercisable (Detail) - Orrstown 2011 Incentive Stock Plan - Employee Stock Option | 6 Months Ended |
Jun. 30, 2017$ / sharesshares | |
$21.14 - $24.99 | |
Range of Exercise Prices | |
Range of Exercise Prices, Minimum (in usd per share) | $ 21.14 |
Range of Exercise Prices, Maximum (in usd per share) | $ 24.99 |
Number Outstanding (in shares) | shares | 33,899 |
Weighted Average Remaining Contractual Life | 2 years 11 months 1 day |
Weighted Average Exercise Price (in usd per share) | $ 21.48 |
$25.00 - $29.99 | |
Range of Exercise Prices | |
Range of Exercise Prices, Minimum (in usd per share) | 25 |
Range of Exercise Prices, Maximum (in usd per share) | $ 29.99 |
Number Outstanding (in shares) | shares | 2,792 |
Weighted Average Remaining Contractual Life | 2 years 9 months 4 days |
Weighted Average Exercise Price (in usd per share) | $ 25.76 |
$30.00 - $34.99 | |
Range of Exercise Prices | |
Range of Exercise Prices, Minimum (in usd per share) | 30 |
Range of Exercise Prices, Maximum (in usd per share) | $ 34.99 |
Number Outstanding (in shares) | shares | 32,144 |
Weighted Average Remaining Contractual Life | 5 months 27 days |
Weighted Average Exercise Price (in usd per share) | $ 31.08 |
$35.00 - $37.59 | |
Range of Exercise Prices | |
Range of Exercise Prices, Minimum (in usd per share) | 35 |
Range of Exercise Prices, Maximum (in usd per share) | $ 37.59 |
Number Outstanding (in shares) | shares | 7,348 |
Weighted Average Remaining Contractual Life | 2 years 22 days |
Weighted Average Exercise Price (in usd per share) | $ 37.08 |
$21.14 - $37.59 | |
Range of Exercise Prices | |
Range of Exercise Prices, Minimum (in usd per share) | 21.14 |
Range of Exercise Prices, Maximum (in usd per share) | $ 37.59 |
Number Outstanding (in shares) | shares | 76,183 |
Weighted Average Remaining Contractual Life | 1 year 9 months 18 days |
Weighted Average Exercise Price (in usd per share) | $ 27.19 |
SHARE-BASED COMPENSATION PLAN51
SHARE-BASED COMPENSATION PLANS - Schedule of Employee Stock Purchase Plan Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items] | ||||
Shares purchased | 53,367 | 2,461 | ||
Employee Stock Purchase Plan | ||||
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items] | ||||
Shares purchased | 0 | 0 | 3,114 | 2,461 |
Weighted average price of shares purchased (in usd per share) | $ 0 | $ 0 | $ 19.71 | $ 16.57 |
Compensation expense recognized | $ 0 | $ 0 | $ 7 | $ 3 |
SHAREHOLDERS_ EQUITY AND REGU52
SHAREHOLDERS’ EQUITY AND REGULATORY CAPITAL - Bank's Actual Capital Ratios (Detail) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Consolidated | ||
Total Capital to risk weighted assets | ||
Actual, Amount | $ 145,122 | $ 139,033 |
Actual, Ratio | 14.50% | 14.60% |
Minimum Capital Requirement, Amount | $ 92,523 | $ 82,391 |
Minimum Capital Requirement, Ratio | 9.25% | 8.625% |
Tier 1 (Core) Capital to risk weighted assets | ||
Actual, Amount | $ 132,589 | $ 127,033 |
Actual, Ratio | 13.30% | 13.30% |
Minimum Capital Requirement, Amount | $ 72,518 | $ 63,286 |
Minimum Capital Requirement, Ratio | 7.25% | 6.625% |
Common Equity Tier 1 (CET1) to risk weighted assets | ||
Actual, Amount | $ 132,589 | $ 127,033 |
Actual, Ratio | 13.30% | 13.30% |
Minimum Capital Requirement, Amount | $ 57,514 | $ 48,957 |
Minimum Capital Requirement, Ratio | 5.75% | 5.125% |
Tier 1 (Core) Capital to average assets | ||
Actual, Amount | $ 132,589 | $ 127,033 |
Actual, Ratio | 9.10% | 9.30% |
Minimum Capital Requirement, Amount | $ 58,397 | $ 54,453 |
Minimum Capital Requirement, Ratio | 4.00% | 4.00% |
Bank | ||
Total Capital to risk weighted assets | ||
Actual, Amount | $ 139,953 | $ 126,408 |
Actual, Ratio | 14.00% | 13.20% |
Minimum Capital Requirement, Amount | $ 92,457 | $ 82,328 |
Minimum Capital Requirement, Ratio | 9.25% | 8.625% |
Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions, Amount | $ 99,954 | $ 95,453 |
Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio | 10.00% | 10.00% |
Tier 1 (Core) Capital to risk weighted assets | ||
Actual, Amount | $ 127,429 | $ 114,417 |
Actual, Ratio | 12.70% | 12.00% |
Minimum Capital Requirement, Amount | $ 72,467 | $ 63,238 |
Minimum Capital Requirement, Ratio | 7.25% | 6.625% |
Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions, Amount | $ 79,963 | $ 76,363 |
Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio | 8.00% | 8.00% |
Common Equity Tier 1 (CET1) to risk weighted assets | ||
Actual, Amount | $ 127,429 | $ 114,417 |
Actual, Ratio | 12.70% | 12.00% |
Minimum Capital Requirement, Amount | $ 57,473 | $ 48,920 |
Minimum Capital Requirement, Ratio | 5.75% | 5.125% |
Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions, Amount | $ 64,970 | $ 62,045 |
Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio | 6.50% | 6.50% |
Tier 1 (Core) Capital to average assets | ||
Actual, Amount | $ 127,429 | $ 114,417 |
Actual, Ratio | 8.70% | 8.40% |
Minimum Capital Requirement, Amount | $ 58,429 | $ 54,500 |
Minimum Capital Requirement, Ratio | 4.00% | 4.00% |
Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions, Amount | $ 73,037 | $ 68,126 |
Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio | 5.00% | 5.00% |
SHAREHOLDERS_ EQUITY AND REGU53
SHAREHOLDERS’ EQUITY AND REGULATORY CAPITAL - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | Jul. 26, 2017 | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Sep. 30, 2015 |
Equity, Class of Treasury Stock [Line Items] | ||||||
Number of shares authorized to be repurchased | 416,000 | |||||
Acquisition of treasury stock (in shares) | 82,725 | 82,725 | ||||
Acquisition of treasury stock | $ 1,438 | $ 1,438 | ||||
Acquisition of treasury stock (in usd per share) | $ 17.38 | |||||
Dividends per share (usd per share) | $ 0.10 | $ 0.09 | $ 0.2 | $ 0.17 | ||
Subsequent Event | ||||||
Equity, Class of Treasury Stock [Line Items] | ||||||
Dividends per share (usd per share) | $ 0.10 | |||||
Maximum | ||||||
Equity, Class of Treasury Stock [Line Items] | ||||||
Stock repurchase program authorized, maximum percentage of outstanding shares of common stock | 5.00% |
EARNINGS PER SHARE - Calculatio
EARNINGS PER SHARE - Calculation of Basic and Diluted Earnings per Share(Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Earnings Per Share [Abstract] | ||||
Net income | $ 3,308 | $ 678 | $ 5,310 | $ 3,258 |
Weighted average shares outstanding - basic | 8,069 | 8,053 | 8,064 | 8,062 |
Dilutive effect of share-based compensation | 139 | 83 | 139 | 76 |
Weighted average shares outstanding - diluted | 8,208 | 8,136 | 8,203 | 8,138 |
Per share information: | ||||
Basic earnings per share (usd per share) | $ 0.41 | $ 0.08 | $ 0.66 | $ 0.40 |
Diluted earnings per share (usd per share) | $ 0.40 | $ 0.08 | $ 0.65 | $ 0.40 |
EARNINGS PER SHARE - Additional
EARNINGS PER SHARE - Additional Information (Detail) - shares shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Employee Stock Option | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Stock options excluded from diluted earnings per share (in shares) | 46 | 96 | 48 | 101 |
FINANCIAL INSTRUMENTS WITH OF56
FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK - Commitments and Conditional Obligations (Detail) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Home equity lines of credit | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Commitments to fund | $ 131,944 | $ 126,811 |
1-4 family residential construction loans | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Commitments to fund | 12,709 | 7,820 |
Commercial real estate, construction and land development loans | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Commitments to fund | 39,339 | 43,830 |
Commercial, industrial and other loans | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Commitments to fund | 136,092 | 111,884 |
Standby letters of credit | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Commitments to fund | $ 7,668 | $ 7,097 |
FINANCIAL INSTRUMENTS WITH OF57
FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK - Additional Information (Detail) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Fair Value Disclosures [Abstract] | ||
Reserve for off-balance sheet credit exposures | $ 829 | $ 784 |
Mortgage Partnership Finance Program | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Sum of total loans sold under the MPF Program | 32,554 | 35,678 |
Limited recourse debt | $ 1,029 | $ 1,029 |
FINANCIAL INSTRUMENTS WITH OF58
FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK - Schedule of Financial Instruments With Off-balance Sheet Risk (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Fair Value Disclosures [Abstract] | ||||
Off-balance sheet credit exposures expense | $ 140 | $ 252 | $ 45 | $ 299 |
FINANCIAL INSTRUMENTS WITH OF59
FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK - MFP Program Recourse Exposure (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Mortgage Partnership Finance Program | ||||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||||
MPF program recourse loss recoveries | $ (35) | $ (59) | $ (26) | $ (112) |
FAIR VALUE - Additional Informa
FAIR VALUE - Additional Information (Detail) - USD ($) | 6 Months Ended | |
Jun. 30, 2017 | Dec. 31, 2016 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Specific charges to value the real estate owned | $ 11,000 | $ 43,000 |
Short term borrowing maturity period | 90 days | |
Fair Value, Measurements, Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value liabilities | $ 0 | 0 |
Allowance for loan losses | $ 1,445,000 | $ 1,967,000 |
FAIR VALUE - Summary of Assets
FAIR VALUE - Summary of Assets Measured at Estimated Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | $ 401,904 | $ 400,154 |
Fair Value, Measurements, Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 401,904 | 400,154 |
Fair Value, Measurements, Recurring | Debt Securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 401,793 | 400,063 |
Fair Value, Measurements, Recurring | Debt Securities | U.S. Government Agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 7,334 | 39,592 |
Fair Value, Measurements, Recurring | Debt Securities | States and political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 163,431 | 164,282 |
Fair Value, Measurements, Recurring | Debt Securities | GSE residential MBSs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 104,776 | 116,944 |
Fair Value, Measurements, Recurring | Debt Securities | GSE residential CMOs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 112,321 | 69,383 |
Fair Value, Measurements, Recurring | Debt Securities | GSE commercial CMOs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 4,973 | 4,856 |
Fair Value, Measurements, Recurring | Debt Securities | Private label CMOs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 3,540 | 5,006 |
Fair Value, Measurements, Recurring | Debt Securities | Asset-backed | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 5,418 | |
Fair Value, Measurements, Recurring | Equity securities | Equity securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 111 | 91 |
Fair Value, Measurements, Recurring | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Debt Securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Debt Securities | U.S. Government Agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Debt Securities | States and political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Debt Securities | GSE residential MBSs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Debt Securities | GSE residential CMOs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Debt Securities | GSE commercial CMOs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Debt Securities | Private label CMOs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Debt Securities | Asset-backed | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | |
Fair Value, Measurements, Recurring | Level 1 | Equity securities | Equity securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Fair Value, Measurements, Recurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 401,904 | 400,154 |
Fair Value, Measurements, Recurring | Level 2 | Debt Securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 401,793 | 400,063 |
Fair Value, Measurements, Recurring | Level 2 | Debt Securities | U.S. Government Agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 7,334 | 39,592 |
Fair Value, Measurements, Recurring | Level 2 | Debt Securities | States and political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 163,431 | 164,282 |
Fair Value, Measurements, Recurring | Level 2 | Debt Securities | GSE residential MBSs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 104,776 | 116,944 |
Fair Value, Measurements, Recurring | Level 2 | Debt Securities | GSE residential CMOs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 112,321 | 69,383 |
Fair Value, Measurements, Recurring | Level 2 | Debt Securities | GSE commercial CMOs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 4,973 | 4,856 |
Fair Value, Measurements, Recurring | Level 2 | Debt Securities | Private label CMOs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 3,540 | 5,006 |
Fair Value, Measurements, Recurring | Level 2 | Debt Securities | Asset-backed | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 5,418 | |
Fair Value, Measurements, Recurring | Level 2 | Equity securities | Equity securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 111 | 91 |
Fair Value, Measurements, Recurring | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Fair Value, Measurements, Recurring | Level 3 | Debt Securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Fair Value, Measurements, Recurring | Level 3 | Debt Securities | U.S. Government Agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Fair Value, Measurements, Recurring | Level 3 | Debt Securities | States and political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Fair Value, Measurements, Recurring | Level 3 | Debt Securities | GSE residential MBSs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Fair Value, Measurements, Recurring | Level 3 | Debt Securities | GSE residential CMOs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Fair Value, Measurements, Recurring | Level 3 | Debt Securities | GSE commercial CMOs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Fair Value, Measurements, Recurring | Level 3 | Debt Securities | Private label CMOs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Fair Value, Measurements, Recurring | Level 3 | Debt Securities | Asset-backed | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | |
Fair Value, Measurements, Recurring | Level 3 | Equity securities | Equity securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | $ 0 | $ 0 |
FAIR VALUE - Schedule of Change
FAIR VALUE - Schedule of Changes in Fair Value of Impaired Loans (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Mar. 31, 2016 | Jun. 30, 2017 | |
Impaired loans | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Changes in fair value of impaired loans still held at June 30 | $ 4 | $ 183 | $ 162 | $ 2 |
FAIR VALUE - Schedule of Chan63
FAIR VALUE - Schedule of Changes in Fair Value of Foreclosed Real Estate Held (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Fair Value Disclosures [Abstract] | ||||
Changes in fair value of OREO still held at June 30 | $ 0 | $ 44 | $ 0 | $ 95 |
FAIR VALUE - Summary of Asset64
FAIR VALUE - Summary of Assets Measured at Fair Value on Nonrecurring Basis (Detail) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreclosed real estate | $ 1,012 | $ 346 |
Fair Value, Measurements, Nonrecurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 3,080 | 4,350 |
Fair Value, Measurements, Nonrecurring | Commercial real estate | Owner-occupied | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 517 | 777 |
Fair Value, Measurements, Nonrecurring | Commercial real estate | Non-owner occupied | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 736 | |
Fair Value, Measurements, Nonrecurring | Commercial real estate | Multi-family | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 182 | 199 |
Fair Value, Measurements, Nonrecurring | Commercial real estate | Non-owner occupied residential | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 378 | 409 |
Fair Value, Measurements, Nonrecurring | Acquisition and development | Commercial and land development | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 1 | |
Fair Value, Measurements, Nonrecurring | Commercial and industrial | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 63 | 66 |
Fair Value, Measurements, Nonrecurring | Residential mortgage | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreclosed real estate | 22 | 88 |
Fair Value, Measurements, Nonrecurring | Residential mortgage | First lien | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 1,781 | 1,994 |
Fair Value, Measurements, Nonrecurring | Residential mortgage | Home equity - lines of credit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 154 | 162 |
Fair Value, Measurements, Nonrecurring | Installment and other loans | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 5 | 6 |
Fair Value, Measurements, Nonrecurring | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 1 | Commercial real estate | Owner-occupied | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 1 | Commercial real estate | Non-owner occupied | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 0 | |
Fair Value, Measurements, Nonrecurring | Level 1 | Commercial real estate | Multi-family | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 1 | Commercial real estate | Non-owner occupied residential | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 1 | Acquisition and development | Commercial and land development | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 0 | |
Fair Value, Measurements, Nonrecurring | Level 1 | Commercial and industrial | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 1 | Residential mortgage | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreclosed real estate | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 1 | Residential mortgage | First lien | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 1 | Residential mortgage | Home equity - lines of credit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 1 | Installment and other loans | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 2 | Commercial real estate | Owner-occupied | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 2 | Commercial real estate | Non-owner occupied | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 0 | |
Fair Value, Measurements, Nonrecurring | Level 2 | Commercial real estate | Multi-family | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 2 | Commercial real estate | Non-owner occupied residential | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 2 | Acquisition and development | Commercial and land development | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 0 | |
Fair Value, Measurements, Nonrecurring | Level 2 | Commercial and industrial | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 2 | Residential mortgage | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreclosed real estate | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 2 | Residential mortgage | First lien | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 2 | Residential mortgage | Home equity - lines of credit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 2 | Installment and other loans | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 3,080 | 4,350 |
Fair Value, Measurements, Nonrecurring | Level 3 | Commercial real estate | Owner-occupied | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 517 | 777 |
Fair Value, Measurements, Nonrecurring | Level 3 | Commercial real estate | Non-owner occupied | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 736 | |
Fair Value, Measurements, Nonrecurring | Level 3 | Commercial real estate | Multi-family | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 182 | 199 |
Fair Value, Measurements, Nonrecurring | Level 3 | Commercial real estate | Non-owner occupied residential | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 378 | 409 |
Fair Value, Measurements, Nonrecurring | Level 3 | Acquisition and development | Commercial and land development | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 1 | |
Fair Value, Measurements, Nonrecurring | Level 3 | Commercial and industrial | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 63 | 66 |
Fair Value, Measurements, Nonrecurring | Level 3 | Residential mortgage | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreclosed real estate | 22 | 88 |
Fair Value, Measurements, Nonrecurring | Level 3 | Residential mortgage | First lien | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 1,781 | 1,994 |
Fair Value, Measurements, Nonrecurring | Level 3 | Residential mortgage | Home equity - lines of credit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 154 | 162 |
Fair Value, Measurements, Nonrecurring | Level 3 | Installment and other loans | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | $ 5 | $ 6 |
FAIR VALUE - Summary of Additio
FAIR VALUE - Summary of Additional Qualitative Information (Detail) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2017 | Dec. 31, 2016 | |
Appraisal of collateral | Impaired loans | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Valuation Techniques | Appraisal of collateral | Appraisal of collateral |
Appraisal of collateral | Foreclosed real estate | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Valuation Techniques | Appraisal of collateral | Appraisal of collateral |
Fair Value, Measurements, Nonrecurring | Impaired loans | Minimum | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Discount rate range (percentage) | 0.00% | 0.00% |
Fair Value, Measurements, Nonrecurring | Impaired loans | Maximum | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Discount rate range (percentage) | 38.00% | 41.00% |
Fair Value, Measurements, Nonrecurring | Foreclosed real estate | Minimum | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Discount rate range (percentage) | 10.00% | 10.00% |
Fair Value, Measurements, Nonrecurring | Foreclosed real estate | Maximum | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Discount rate range (percentage) | 10.00% | 18.00% |
Fair Value, Measurements, Nonrecurring | Appraisal of collateral | Impaired loans | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Fair Value Estimate | $ 3,080 | $ 4,350 |
Fair Value, Measurements, Nonrecurring | Appraisal of collateral | Impaired loans | Minimum | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Discount rate range (percentage) | 10.00% | 10.00% |
Fair Value, Measurements, Nonrecurring | Appraisal of collateral | Impaired loans | Maximum | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Discount rate range (percentage) | 75.00% | 75.00% |
Fair Value, Measurements, Nonrecurring | Appraisal of collateral | Foreclosed real estate | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Fair Value Estimate | $ 22 | $ 88 |
Fair Value, Measurements, Nonrecurring | Appraisal of collateral | Foreclosed real estate | Minimum | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Discount rate range (percentage) | 17.00% | 13.00% |
Fair Value, Measurements, Nonrecurring | Appraisal of collateral | Foreclosed real estate | Maximum | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Discount rate range (percentage) | 17.00% | 17.00% |
FAIR VALUE - Financial Instrume
FAIR VALUE - Financial Instruments at Estimated Fair Values (Detail) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Financial Assets | ||
Interest-bearing deposits with banks | $ 18,258 | $ 14,201 |
Restricted investments in bank stocks | 7,072 | 7,970 |
AFS securities | 401,904 | 400,154 |
Carrying Amount | ||
Financial Assets | ||
Cash and due from banks | 19,754 | 16,072 |
Interest-bearing deposits with banks | 18,258 | 14,201 |
Restricted investments in bank stocks | 7,072 | 7,970 |
AFS securities | 401,904 | 400,154 |
Loans held for sale | 5,182 | 2,768 |
Loans, net of allowance for loan losses | 921,631 | 870,616 |
Accrued interest receivable | 4,467 | 4,672 |
Financial Liabilities | ||
Deposits | 1,195,936 | 1,152,452 |
Short-term borrowings | 90,562 | 87,864 |
Long-term debt | 23,991 | 24,163 |
Accrued interest payable | 448 | 437 |
Off-balance sheet instruments | 0 | 0 |
Fair Value | ||
Financial Assets | ||
Cash and due from banks | 19,754 | 16,072 |
Interest-bearing deposits with banks | 18,258 | 14,201 |
AFS securities | 401,904 | 400,154 |
Loans held for sale | 5,320 | 2,843 |
Loans, net of allowance for loan losses | 922,642 | 870,470 |
Accrued interest receivable | 4,467 | 4,672 |
Financial Liabilities | ||
Deposits | 1,193,225 | 1,149,727 |
Short-term borrowings | 90,562 | 87,864 |
Long-term debt | 24,487 | 24,966 |
Accrued interest payable | 448 | 437 |
Off-balance sheet instruments | 0 | 0 |
Fair Value | Level 1 | ||
Financial Assets | ||
Cash and due from banks | 19,754 | 16,072 |
Interest-bearing deposits with banks | 18,258 | 14,201 |
AFS securities | 0 | 0 |
Loans held for sale | 0 | 0 |
Loans, net of allowance for loan losses | 0 | 0 |
Accrued interest receivable | 0 | 0 |
Financial Liabilities | ||
Deposits | 0 | 0 |
Short-term borrowings | 0 | 0 |
Long-term debt | 0 | 0 |
Accrued interest payable | 0 | 0 |
Off-balance sheet instruments | 0 | 0 |
Fair Value | Level 2 | ||
Financial Assets | ||
Cash and due from banks | 0 | 0 |
Interest-bearing deposits with banks | 0 | 0 |
AFS securities | 401,904 | 400,154 |
Loans held for sale | 5,320 | 2,843 |
Loans, net of allowance for loan losses | 0 | 0 |
Accrued interest receivable | 2,501 | 2,643 |
Financial Liabilities | ||
Deposits | 1,193,225 | 1,149,727 |
Short-term borrowings | 90,562 | 87,864 |
Long-term debt | 24,487 | 24,966 |
Accrued interest payable | 448 | 437 |
Off-balance sheet instruments | 0 | 0 |
Fair Value | Level 3 | ||
Financial Assets | ||
Cash and due from banks | 0 | 0 |
Interest-bearing deposits with banks | 0 | 0 |
AFS securities | 0 | 0 |
Loans held for sale | 0 | 0 |
Loans, net of allowance for loan losses | 922,642 | 870,470 |
Accrued interest receivable | 1,966 | 2,029 |
Financial Liabilities | ||
Deposits | 0 | 0 |
Short-term borrowings | 0 | 0 |
Long-term debt | 0 | 0 |
Accrued interest payable | 0 | 0 |
Off-balance sheet instruments | $ 0 | $ 0 |
CONTINGENCIES (Detail)
CONTINGENCIES (Detail) | Jun. 22, 2015 | Jun. 30, 2017USD ($)claim | Jun. 30, 2016USD ($) | Jun. 30, 2017USD ($)claim | Jun. 30, 2016USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |||||
Legal proceedings | claim | 0 | 0 | |||
Number of days to file an amendment or stand on current amended complaint | 30 days | ||||
Regulatory settlement | $ | $ 0 | $ 1,000,000 | $ 0 | $ 1,000,000 |