Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Jun. 30, 2013 | |
Entity Information [Line Items] | ' | ' |
Entity Registrant Name | 'ROYAL BANCSHARES OF PENNSYLVANIA INC | ' |
Entity Central Index Key | '0000922487 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Well-known Seasoned Issuer | 'No | ' |
Entity Voluntary Filers | 'No | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Public Float | ' | $0 |
Document Fiscal Year Focus | '2013 | ' |
Document Fiscal Period Focus | 'FY | ' |
Document Type | '10-K | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 31-Dec-13 | ' |
Common Class A [Member] | ' | ' |
Entity Information [Line Items] | ' | ' |
Entity Common Stock, Shares Outstanding | 0 | ' |
Common Class B [Member] | ' | ' |
Entity Information [Line Items] | ' | ' |
Entity Common Stock, Shares Outstanding | 0 | ' |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
ASSETS | ' | ' |
Cash and due from banks | $9,154 | $10,621 |
Interest bearing deposits | 7,690 | 18,181 |
Total cash and cash equivalents | 16,844 | 28,802 |
Investment securities available-for-sale ("AFS"), at fair value | 308,727 | 349,203 |
Other investment, at cost | 2,250 | 2,250 |
Federal Home Loan Bank ("FHLB") stock, at cost | 4,204 | 6,011 |
Loans and leases held for sale ("LHFS"), at lower of cost or fair market value | 1,446 | 1,572 |
Loans and leases held for investment ("LHFI") | 366,481 | 344,165 |
Less allowance for loan and lease losses | 13,671 | 17,261 |
Net loans and leases | 352,810 | 326,904 |
Bank owned life insurance | 15,124 | 14,585 |
Accrued interest receivable | 7,054 | 10,256 |
Other real estate owned ("OREO"), net | 9,617 | 13,435 |
Premises and equipment, net | 4,475 | 5,232 |
Other assets | 9,703 | 11,205 |
Total assets | 732,254 | 769,455 |
Deposits | ' | ' |
Non-interest bearing | 60,473 | 58,531 |
Interest bearing | 468,491 | 496,386 |
Total deposits | 528,964 | 554,917 |
Short-term borrowings | 10,000 | 0 |
Long-term borrowings | 97,881 | 108,333 |
Subordinated debentures | 25,774 | 25,774 |
Accrued interest payable | 965 | 3,760 |
Other liabilities | 20,865 | 23,103 |
Total liabilities | 684,449 | 715,887 |
Royal Bancshares of Pennsylvania, Inc. equity: | ' | ' |
Preferred stock, Series A perpetual, $1,000 liquidation value, 500,000 shares authorized,30,407 shares issued and outstanding at December 31, 2013 and 2012 | 29,950 | 29,396 |
Common stock | ' | 23,065 |
Additional paid in capital | 127,299 | 126,287 |
Accumulated deficit | -120,396 | -121,877 |
Accumulated other comprehensive loss | -6,122 | -142 |
Treasury stock - at cost, shares of Class A, 453,077 and 498,488 at December 31, 2013 and 2012 | -6,336 | -6,971 |
Total Royal Bancshares of Pennsylvania, Inc. shareholders' equity | 47,534 | 49,758 |
Noncontrolling interest | 271 | 3,810 |
Total shareholders' equity | 47,805 | 53,568 |
Total liabilities and shareholders' equity | 732,254 | 769,455 |
Common Class A [Member] | ' | ' |
Royal Bancshares of Pennsylvania, Inc. equity: | ' | ' |
Common stock | 22,940 | 22,863 |
Total shareholders' equity | 22,940 | 22,863 |
Common Class B [Member] | ' | ' |
Royal Bancshares of Pennsylvania, Inc. equity: | ' | ' |
Common stock | 199 | 202 |
Total shareholders' equity | $199 | $202 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Royal Bancshares of Pennsylvania, Inc | ' | ' |
Preferred stock, liquidation value (in dollars per share) | $1,000 | $1,000 |
Preferred stock, shares authorized (in shares) | 500,000 | 500,000 |
Preferred stock, shares issued (in shares) | 30,407 | 30,407 |
Preferred stock, shares outstanding (in shares) | 30,407 | 30,407 |
Common Class A [Member] | ' | ' |
Royal Bancshares of Pennsylvania, Inc | ' | ' |
Common stock, par value (in dollars per share) | $2 | $2 |
Common stock, shares authorized (in shares) | 40,000,000 | 20,000,000 |
Common stock, shares issued (in shares) | 11,469,940 | 11,431,638 |
Treasury stock, shares (in shares) | 453,077 | 498,488 |
Common Class B [Member] | ' | ' |
Royal Bancshares of Pennsylvania, Inc | ' | ' |
Common stock, par value (in dollars per share) | $0.10 | $0.10 |
Common stock, shares authorized (in shares) | 3,000,000 | 3,000,000 |
Common stock, shares issued (in shares) | 1,987,142 | 2,020,499 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 12 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Interest income | ' | ' |
Loans and leases, including fees | $21,741 | $25,266 |
Investment securities available for sale | 5,757 | 6,677 |
Deposits in banks | 26 | 38 |
Total Interest Income | 27,524 | 31,981 |
Interest expense | ' | ' |
Deposits | 4,022 | 5,898 |
Short-term borrowings | 22 | 309 |
Long-term borrowings | 3,313 | 3,692 |
Total Interest Expense | 7,357 | 9,899 |
Net Interest Income | 20,167 | 22,082 |
(Credit) provision for loan and lease losses | -872 | 5,997 |
Net Interest Income after (Credit) Provision for Loan and Lease Losses | 21,039 | 16,085 |
Non-interest income | ' | ' |
Gain on sale of premises and equipment | 2,524 | 0 |
Net gains on sales of other real estate owned | 1,427 | 363 |
Service charges and fees | 1,323 | 1,218 |
Gains on sales of loans and leases | 686 | 2,057 |
Income from bank owned life insurance | 539 | 553 |
Net gains on the sale of AFS investment securities | 158 | 1,030 |
Other income | 207 | 747 |
Total other-than-temporary impairment losses on investment securities | 0 | -2,359 |
Total Non-interest Income | 6,864 | 3,609 |
Non-interest expense | ' | ' |
Salaries and benefits | 10,276 | 11,576 |
Professional and legal fees | 2,954 | 4,180 |
OREO expenses and impairment charges | 2,785 | 8,401 |
Occupancy and equipment | 2,281 | 2,192 |
Loss contingency | 1,750 | 0 |
Pennsylvania shares tax | 1,123 | 1,148 |
FDIC and state assessments | 1,038 | 1,056 |
Loan collection expenses | 557 | 465 |
Directors fees | 490 | 401 |
Restructuring charges | 361 | 0 |
Impairment of loans held for sale | 153 | 2,002 |
Department of Justice fine | 0 | 2,000 |
Other operating expenses | 2,562 | 2,903 |
Total Non-interest Expense | 26,330 | 36,324 |
Income (Loss) Before Income Taxes | 1,573 | -16,630 |
Income tax expense | 42 | 0 |
Net Income (Loss) | 1,531 | -16,630 |
Less net loss attributable to noncontrolling interest | -578 | -1,005 |
Net Income (Loss) Attributable to Royal Bancshares of Pennsylvania, Inc. | 2,109 | -15,625 |
Less Preferred stock Series A accumulated dividend and accretion | 2,075 | 2,038 |
Net Income (Loss) to Common Shareholders | $34 | ($17,663) |
Net Income (Loss) - basic and diluted (in dollars per share) | $0 | ($1.33) |
Statements_of_Consolidated_Com
Statements of Consolidated Comprehensive Loss (USD $) | 12 Months Ended | |||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | ||
Statements of Consolidated Comprehensive Loss [Abstract] | ' | ' | ||
Net income (loss) | $1,531 | ($16,630) | ||
Unrealized losses on investment securities: | ' | ' | ||
Unrealized holding losses arising during period | -6,719 | -1,038 | ||
Less adjustment for impaired investments | 0 | [1] | -1,557 | [1] |
Less reclassification adjustment for gains realized in net income (loss) | 104 | [2] | 680 | [2] |
Unrealized losses on investment securities | -6,823 | -161 | ||
Unrecognized benefit obligation expense: | ' | ' | ||
Actuarial gain (loss) | 627 | -1,092 | ||
Less reclassification adjustment for amortization | -216 | [3] | -311 | [3] |
Other comprehensive loss | -5,980 | -942 | ||
Comprehensive loss | -4,449 | -17,572 | ||
Less net loss attributable to noncontrolling interest | -578 | -1,005 | ||
Comprehensive loss attributable to Royal Bancshares of Pennsylvania, Inc. | ($3,871) | ($16,567) | ||
[1] | Amounts are included in total other-than-temporary impairment on investment securities on the Consolidated Statements of Operations in total noninterest income. | |||
[2] | Amounts are included in net gains on the sale of available for sale investment securities on the Consolidated Statements of Operations in total noninterest income. | |||
[3] | Amounts are included in salaries and benefits on the Consolidated Statements of Operations in noninterest expense. |
Consolidated_Statement_of_Chan
Consolidated Statement of Changes in Shareholders' Equity (USD $) | Preferred Stock Series A [Member] | Common Class A [Member] | Common Class B [Member] | Additional Paid In Capital [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Treasury Stock [Member] | Noncontrolling Interest [Member] | Total |
In Thousands, unless otherwise specified | |||||||||
Balance at Dec. 31, 2011 | $28,878 | $22,723 | $208 | $126,245 | ($105,600) | $800 | ($6,971) | $4,815 | $71,098 |
Balance (in shares) at Dec. 31, 2011 | ' | 11,362 | 2,081 | ' | ' | ' | ' | ' | ' |
Comprehensive loss | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net (loss) income | ' | ' | ' | ' | -15,625 | ' | ' | -1,005 | -16,630 |
Other comprehensive loss, net of reclassifications and taxes | ' | ' | ' | ' | ' | -942 | ' | ' | -942 |
Common stock conversion from Class B to Class A | ' | 140 | -6 | ' | -134 | ' | ' | ' | 0 |
Common stock conversion from Class B to Class A (in shares) | ' | 70 | -61 | ' | ' | ' | ' | ' | ' |
Accretion of discount on preferred stock | 518 | ' | ' | ' | -518 | ' | ' | ' | 0 |
Stock option expense | ' | ' | ' | 42 | ' | ' | ' | ' | 42 |
Balance at Dec. 31, 2012 | 29,396 | 22,863 | 202 | 126,287 | -121,877 | -142 | -6,971 | 3,810 | 53,568 |
Balance (in shares) at Dec. 31, 2012 | ' | 11,432 | 2,020 | ' | ' | ' | ' | ' | ' |
Comprehensive loss | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net (loss) income | ' | ' | ' | ' | 2,109 | ' | ' | -578 | 1,531 |
Other comprehensive loss, net of reclassifications and taxes | ' | ' | ' | ' | ' | -5,980 | ' | ' | -5,980 |
Purchase of subsidiary shares from noncontrolling interest | ' | ' | ' | 1,559 | ' | ' | ' | -2,409 | -850 |
Distributions to non controlling interests | ' | ' | ' | ' | ' | ' | ' | -552 | -552 |
Common stock conversion from Class B to Class A | ' | 77 | -3 | ' | -74 | ' | ' | ' | 0 |
Common stock conversion from Class B to Class A (in shares) | ' | 38 | -33 | ' | ' | ' | ' | ' | ' |
Accretion of discount on preferred stock | 554 | ' | ' | ' | -554 | ' | ' | ' | 0 |
Treasury shares issued for compensation | ' | ' | ' | -569 | ' | ' | 635 | ' | 66 |
Stock option expense | ' | ' | ' | 22 | ' | ' | ' | ' | 22 |
Balance at Dec. 31, 2013 | $29,950 | $22,940 | $199 | $127,299 | ($120,396) | ($6,122) | ($6,336) | $271 | $47,805 |
Balance (in shares) at Dec. 31, 2013 | ' | 11,470 | 1,987 | ' | ' | ' | ' | ' | ' |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Cash flows from operating activities | ' | ' |
Net income (loss) | $2,109 | ($15,625) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ' | ' |
Depreciation and amortization | 451 | 417 |
Stock compensation expense | 22 | 42 |
Net amortization of investment securities | 4,183 | 6,423 |
Net accretion on loans | -382 | -241 |
Impairment of AFS investment securities | 0 | 2,359 |
Net gains on sales of AFS investment securities | -158 | -1,030 |
(Credit) provision for loan and lease losses | -872 | 5,997 |
Impairment charge on loans held for sale | 153 | 2,002 |
Proceeds from sales of loans and leases | 3,919 | 11,052 |
Gains on sales of loans and leases | -686 | -2,057 |
Impairment charge for other real estate owned | 1,517 | 6,741 |
Net gains on sales of other real estate | -1,427 | -363 |
Gains on sales of premises and equipment | -2,524 | 0 |
Income from equity investments | 0 | -75 |
Income from bank owned life insurance | -539 | -553 |
Changes in assets and liabilities: | ' | ' |
Decrease in accrued interest receivable | 3,202 | 5,207 |
(Increase) decrease in other assets | 1,502 | 3,121 |
(Decrease) increase in accrued interest payable | -2,795 | 310 |
(Decrease) increase in other liabilities | -2,238 | 3,154 |
Net cash provided by operating activities | 5,437 | 26,881 |
Cash flows from investing activities | ' | ' |
Proceeds from maturities, calls and paydowns of AFS investment securities | 94,676 | 148,112 |
Proceeds from sales of AFS investment securities | 31,046 | 28,246 |
Purchase of AFS investment securities | -99,720 | -205,265 |
Net redemption of Federal Home Loan Bank stock | 1,807 | 2,463 |
Net (increase) decrease in loans | -34,408 | 52,691 |
Proceeds from sales of real estate owned | 12,779 | 12,014 |
Proceeds from the sale of premises and equipment | 3,267 | 0 |
Purchase of premises and equipment | -437 | -255 |
Distribution from investments in real estate | 0 | 75 |
Net cash provided by investing activities | 9,010 | 38,081 |
Cash flows from financing activities | ' | ' |
Increase (decrease) in demand and NOW accounts | 3,397 | 4,745 |
(Decrease) increase in money market and savings accounts | -14,560 | -2,262 |
Decrease in certificates of deposit | -14,790 | -23,482 |
Change in short-term borrowings | 10,000 | -54,218 |
Repayments of long-term borrowings | -50,452 | -449 |
Proceeds from long-term borrowings | 40,000 | 15,000 |
Net cash used in financing activities | -26,405 | -60,666 |
Net increase (decrease) in cash and cash equivalents | -11,958 | 4,296 |
Cash and cash equivalents at beginning of period | 28,802 | 24,506 |
Cash and cash equivalents at end of period | 16,844 | 28,802 |
Supplemental Disclosure | ' | ' |
Interest | 10,152 | 9,589 |
Income taxes | 0 | 0 |
Transfers to other real estate owned | $9,051 | $10,811 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | ' | ||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | ||||||||||||
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||||||||||
1. Basis of Financial Statement Presentation | |||||||||||||
Nature of Operations | |||||||||||||
Royal Bancshares of Pennsylvania, Inc. (the “Company”), through its wholly-owned subsidiary Royal Bank America (“Royal Bank”) offers a full range of banking services to individual and corporate customers primarily located in the Mid-Atlantic states. Royal Bank competes with other banking and financial institutions in certain markets, including financial institutions with resources substantially greater than its own. Commercial banks, savings banks, savings and loan associations, credit unions and brokerage firms actively compete for savings and time deposits and for various types of loans. Such institutions, as well as consumer finance and insurance companies, may be considered competitors of Royal Bank with respect to one or more of the services it renders. | |||||||||||||
Principles of Consolidation | |||||||||||||
The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Royal Investments of Delaware, Inc., Royal Captive Insurance Company, Royal Preferred, LLC, and Royal Bank, including Royal Bank’s subsidiaries, Royal Real Estate of Pennsylvania, Inc., Royal Investment America, LLC, RBA Property LLC, Narberth Property Acquisition LLC, and Rio Marina LLC. In addition, Royal Bank has a 60% ownership interest in Royal Bank America Leasing, LP. Royal Bank had a 60% ownership interest in Crusader Servicing Corporation (“CSC”) and Royal Tax Lien Services, LLC (“RTL”). Effective December 31, 2013, Royal Bank agreed to a $1.25 million cash settlement with the former President of CSC and RTL, in which Royal Bank acquired his 40% ownership interest in RTL for $850,000. The former President also relinquished his 20% ownership interest in CSC to Royal Bank. The combined value of the ownership interests was $2.6 million. The settlement resulted in a $1.5 million gain for Royal Bank which was recorded as an increase to Additional Paid in Capital within Stockholders Equity. As part of the cash settlement Royal Bank agreed to pay $400,000 for prior tax distributions. Additionally, the settlement agreement also includes a possible tax payment upon completion of the 2013 Forms K-1. Effective, December 31, 2013, Royal Bank is an 80% owner of CSC and 100% owner of RTL. The two Delaware trusts, Royal Bancshares Capital Trust I and Royal Bancshares Capital Trust II are not consolidated per requirements under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 810, “Consolidation” (“ASC Topic 810”). These consolidated financial statements reflect the historical information of the Company. All significant intercompany transactions and balances have been eliminated. | |||||||||||||
Use of Estimates | |||||||||||||
In preparing the consolidated financial statements in accordance with United States generally accepted accounting principles (“U.S. GAAP”), management is required to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and the accompanying notes. These estimates and assumptions are based on information available as of the date of the consolidated financial statements; therefore, actual results could differ from those estimates. | |||||||||||||
The principal estimates that are particularly susceptible to significant change in the near term relate to the allowance for loan and lease losses, loans held for sale, the valuation of other real estate owned, the valuation of deferred tax assets, other-than-temporary impairment losses on investment securities, net periodic pension costs and the pension benefit obligation. In connection with the allowance for loan and lease losses estimate, management obtains independent appraisals for real estate collateral. However, future changes in real estate market conditions and the economy could affect the Company’s allowance for loan and lease losses. In addition, regulatory agencies, as an integral part of their examination process, periodically review the credit portfolio and the allowance. Such review may result in additional provisions based on their judgment of information available at the time of each examination. | |||||||||||||
Significant Concentration of Credit Risk | |||||||||||||
Credit risk is one of the Company’s most significant risks. It is critical for consistent profitability that the Company effectively manages credit risk. Most of the Company’s activities are with customers located within the Mid-Atlantic region of the country. “Note 3 – Investment Securities” to the Consolidated Financial Statements discusses the types of securities in which the Company invests. “Note 4 – Loans and Leases” to the Consolidated Financial Statements discusses the types of lending in which the Company engages. The Company does not have any portion of its business dependent on a single or limited number of customers, the loss of which would have a material adverse effect on its business. The Company has 92% of its investment portfolio in securities issued by government sponsored entities. The Company’s tax lien portfolio has a geographic concentration in the State of New Jersey. | |||||||||||||
No substantial portion of loans is concentrated within a single industry or group of related industries, except a significant majority of loans are secured by real estate. There are numerous risks associated with commercial and consumer lending that could impact the borrower’s ability to repay on a timely basis. They include, but are not limited to: the owner’s business expertise, changes in local, national, and in some cases international economies, competition, governmental regulation, and the general financial stability of the borrowing entity. Over the last few years, the Company had been impacted by deterioration in economic conditions as it pertains to real estate loans. The Company’s commercial real estate, commercial and construction and development loans comprised 40%, 22% and 12%, respectively, of the loan portfolio. | |||||||||||||
The Company attempts to mitigate these risks through conservative underwriting policies and procedures which include an analysis of the borrower’s business and industry history, its financial position, as well as that of the business owner. The Company will also require the borrower to provide current financial information on the operation of the business periodically over the life of the loan. In addition, most commercial loans are secured by assets of the business or those of the business owner, which can be liquidated if the borrower defaults, along with the personal surety of the business owner. | |||||||||||||
U.S. GAAP RAP Difference | |||||||||||||
In connection with a prior bank regulatory examination, the Federal Deposit Insurance Company (“FDIC”) concluded, based upon its interpretation of the Consolidated Reports of Condition and Income (the “Call Report”) instructions and under regulatory accounting principles (“RAP”), that income from Royal Bank’s tax lien business should be recognized on a cash basis, not an accrual basis. Royal Bank’s current accrual method is in accordance with U.S. GAAP. Royal Bank disagrees with the FDIC’s conclusion and filed the Call Report for December 31, 2013 and the previous 13 quarters in accordance with U.S. GAAP. However, the change in the manner of revenue recognition for the tax lien business for regulatory accounting purposes affects Royal Bank’s and potentially the Company’s capital ratios as disclosed in “Note 2 - Regulatory Matters and Significant Risks And Uncertainties” and “Note 15 - Regulatory Capital Requirements” to the Consolidated Financial Statements. The resolution of this matter will be decided by additional joint regulatory agency guidance which includes the Federal Reserve Bank, the FDIC, and the office of the Controller of the Currency ("OCC"). | |||||||||||||
Reclassifications | |||||||||||||
Certain items in the 2012 consolidated financial statements and accompanying notes have been reclassified to conform to the current year’s presentation format. There was no effect on net income or net loss for the periods presented herein as a result of the reclassification. | |||||||||||||
Restatement | |||||||||||||
In the fourth quarter of 2013, the Company recorded an error correction in previously issued financial statements related to net income tax receivables. The tax receivables were related to amended tax returns for 2005 through 2007, in which the Company carried back losses from 2008 through 2009. These amended returns were filed during the time period 2008 through 2011. In the fourth quarter of 2013, after an IRS joint committee concluded their review of the amended returns, management determined that the tax receivables would not be realized. The Company recorded a cumulative effect adjustment of $4.8 million to accumulated deficit, a component of the consolidated statement of changes in shareholders' equity, as of January 1, 2012 with the offsetting adjustment recorded to other assets and other liabilities. There was no effect on net income, net loss, or earnings or loss per basic and diluted shares for the periods presented herein as a result of the restatement. Below are the consolidated balance sheets and changes in shareholder equity statements that show the previously issued financial statement, the error correction, and the restated balances. | |||||||||||||
Royal Bancshares of Pennsylvania, Inc and Subsidiaries | |||||||||||||
Restatement of the Consolidated Balance Sheet | |||||||||||||
At December 31, 2012 | As | Adjustment | As Restated | ||||||||||
Originally | |||||||||||||
Reported | |||||||||||||
(In thousands) | |||||||||||||
Assets | |||||||||||||
Total cash and cash equivalents | $ | 28,802 | $ | - | $ | 28,802 | |||||||
Investment securities AFS, at fair value | 349,203 | - | 349,203 | ||||||||||
Other investment, at cost | 2,250 | - | 2,250 | ||||||||||
FHLB stock, at cost | 6,011 | - | 6,011 | ||||||||||
Loans and leases held for sale | 1,572 | - | 1,572 | ||||||||||
Loans and leases, net | 326,904 | - | 326,904 | ||||||||||
Bank owned life insurance | 14,585 | - | 14,585 | ||||||||||
Accrued interest receivable | 10,256 | - | 10,256 | ||||||||||
OREO, net | 13,435 | - | 13,435 | ||||||||||
Premises and equipment, net | 5,232 | - | 5,232 | ||||||||||
Other assets | 15,466 | (4,261 | ) | 11,205 | |||||||||
Total assets | $ | 773,716 | $ | (4,261 | ) | $ | 769,455 | ||||||
Liabilities | |||||||||||||
Total deposits | $ | 554,917 | $ | - | $ | 554,917 | |||||||
Long-term borrowings | 108,333 | - | 108,333 | ||||||||||
Subordinated debentures | 25,774 | - | 25,774 | ||||||||||
Accrued interest payable | 3,760 | - | 3,760 | ||||||||||
Other liabilities | 22,517 | 586 | 23,103 | ||||||||||
Total liabilities | 715,301 | 586 | 715,887 | ||||||||||
Shareholders' equity | |||||||||||||
Preferred stock | 29,396 | - | 29,396 | ||||||||||
Common stock | 23,065 | - | 23,065 | ||||||||||
Additional paid in capital | 126,287 | - | 126,287 | ||||||||||
Accumulated deficit | (117,080 | ) | (4,797 | ) | (121,877 | ) | |||||||
Accumulated other comprehensive loss | (142 | ) | - | (142 | ) | ||||||||
Treasury stock | (6,971 | ) | - | (6,971 | ) | ||||||||
Noncontrolling interest | 3,860 | (50 | ) | 3,810 | |||||||||
Shareholders' equity | 58,415 | (4,847 | ) | 53,568 | |||||||||
Total liabilities and shareholders' equity | $ | 773,716 | $ | (4,261 | ) | $ | 769,455 | ||||||
Royal Bancshares of Pennsylvania, Inc and Subsidiaries | |||||||||||||
Restatement of Consolidated Statement of Changes in Shareholders' Equity | |||||||||||||
At January 1, 2012 | As | Adjustment | As Restated | ||||||||||
Originally | |||||||||||||
Reported | |||||||||||||
(In thousands) | |||||||||||||
Preferred stock | $ | 28,878 | $ | - | $ | 28,878 | |||||||
Class A common stock | 22,723 | - | 22,723 | ||||||||||
Class B common stock | 208 | - | 208 | ||||||||||
Additional paid in capital | 126,245 | - | 126,245 | ||||||||||
Accumulated deficit | (100,803 | ) | (4,797 | ) | (105,600 | ) | |||||||
Accumulated other comprehensive income | 800 | - | 800 | ||||||||||
Treasury stock | (6,971 | ) | - | (6,971 | ) | ||||||||
Noncontrolling interest | 4,865 | (50 | ) | 4,815 | |||||||||
Total shareholders' equity | $ | 75,945 | $ | (4,847 | ) | $ | 71,098 | ||||||
Cash and Cash Equivalents | |||||||||||||
For purposes of reporting cash flows, cash and cash equivalents include cash on hand, amounts due from banks, interest-bearing deposits and federal funds sold. Generally, federal funds are purchased and sold for one-day periods. | |||||||||||||
Investment Securities | |||||||||||||
Management determines the appropriate classification of debt securities at the time of purchase and re-evaluates such designation as of each balance sheet date. Investments in debt securities that the Company has the positive intent and ability to hold to maturity are classified as held to maturity securities and reported at amortized cost. Debt and equity securities that are bought and held principally for the purpose of selling them in the near term are classified as trading securities and reported at fair value, with unrealized holding gains and losses included in earnings. Debt and equity securities not classified as trading securities, nor as held to maturity securities are classified as available for sale securities and reported at fair value, with unrealized holding gains or losses, net of deferred income taxes (when applicable), reported in the accumulated other comprehensive income component of shareholders’ equity. The Company did not hold trading securities nor had securities classified as held to maturity at December 31, 2013 and 2012. Discounts and premiums are accreted/amortized to income by use of the level-yield method. Gain or loss on sales of securities available for sale is based on the specific identification method. | |||||||||||||
The Company evaluates securities for other-than-temporary impairment (“OTTI”) at least on a quarterly basis. The Company assesses whether OTTI is present when the fair value of a security is less than its amortized cost. All investment securities are evaluated for OTTI under FASB ASC Topic 320, “Investments-Debt & Equity Securities” (“ASC Topic 320”). Non-agency collateralized mortgage obligations that are rated below AA are evaluated under FASB ASC Topic 320 Subtopic 40, “Beneficial Interests in Securitized Financial Assets” or under FASB ASC Topic 325, “Investments-Other” when applicable. In determining whether OTTI exists, management considers numerous factors, including but not limited to: (1) the length of time and the extent to which the fair value is less than the amortized cost, (2) the Company’s intent to hold or sell the security, (3) the financial condition and results of the issuer including changes in capital, (4) the credit rating of the issuer, (5) analysts’ earnings estimate, (6) industry trends specific to the security, and (7) timing of debt maturity and status of debt payments. | |||||||||||||
Under ASC Topic 320, OTTI is considered to have occurred with respect to debt securities (1) if an entity intends to sell the security; (2) if it is more likely than not an entity will be required to sell the security before recovery of its amortized cost basis; or (3) the present value of the expected cash flows is not sufficient to recover the entire amortized cost basis. In addition, the amount of the OTTI recognized in earnings depends on whether an entity intends to sell or will more likely than not be required to sell the security. If an entity intends to sell the security or will be required to sell the security, the OTTI shall be recognized in earnings equal to the entire difference between the fair value and the amortized cost basis at the balance sheet date. If an entity does not intend to sell the security and it is not more likely than not that the entity will be required to sell the security before the recovery of its amortized cost basis, the OTTI shall be separated into two amounts, the credit-related loss and the noncredit-related loss. The credit-related loss is based on the present value of the expected cash flows and is recognized in earnings. The noncredit-related loss is based on other factors such as illiquidity and is recognized in other comprehensive income. | |||||||||||||
Other Investment | |||||||||||||
This investment includes the Solomon Hess SBA Loan Fund, which the Company invested in to partially satisfy its community reinvestment requirement. Shares in this fund are not publicly traded and therefore have no readily determinable fair market value. An investor can have their investment in the Fund redeemed for the balance of their capital account at any quarter end with a 60-day notice to the Fund. The investment in this Fund is recorded at cost. | |||||||||||||
Federal Home Loan Bank Stock | |||||||||||||
As a member of the Federal Home Loan Bank of Pittsburgh (“FHLB”), the Company is required to purchase and hold stock in the FHLB to satisfy membership and borrowing requirements. The stock can only be sold to the FHLB or to another member institution, and all sales of FHLB stock must be at par. As a result of these restrictions, there is no active market for the FHLB stock. As of December 31, 2013 and 2012, FHLB stock totaled $4.2 million and $6.0 million, respectively. | |||||||||||||
FHLB stock is held as a long-term investment and its value is determined based on the ultimate recoverability of the par value. The Company evaluates impairment quarterly. The decision of whether impairment exists is a matter of judgment that reflects management’s view of the FHLB’s long-term performance, which includes factors such as the following: (1) its operating performance, (2) the severity and duration of declines in the fair value of its net assets related to its capital stock amount, (3) its liquidity position, and (4) the impact of legislative and regulatory changes on the FHLB. Based on the capital adequacy and the liquidity position of the FHLB, management believes that the par value of its investment in FHLB stock will be realized. Accordingly, there is no other-than-temporary impairment related to the carrying amount of the Company’s FHLB stock as of December 31, 2013. | |||||||||||||
Loans Held for Sale | |||||||||||||
At December 31, 2013, the Company’s loans held for sale (“LHFS”) were comprised of three loans totaling $1.4 million. The loans were transferred from loans held for investment (“LHFI”) to LHFS at fair market value using expected net sales proceeds. At the time of transfer to LHFS, a gain of $429,000 was recorded in non-interest income. Generally any subsequent credit losses on LHFS are recorded as a component of non-interest expense. At December 31, 2012, LHFS were comprised of one $1.6 million non-accrual commercial real estate loan. | |||||||||||||
Loans and Leases | |||||||||||||
Loans and leases are classified as LHFI when management has the intent and ability to hold the loan or lease for the foreseeable future or until maturity or payoff. LHFI are stated at their outstanding unpaid principal balances, net of an allowance for loan and leases losses and any deferred fees or costs. Interest income is accrued on the unpaid principal balance. Loan origination fees, net of certain direct origination costs, are deferred and recognized as an adjustment of the yield (interest income) of the related loans. The Company is generally amortizing these amounts over the contractual life of the loan. The Company’s commercial and real estate loans, including construction and land development loans, are primarily in the greater Philadelphia metropolitan area as well as selected locations throughout the mid-Atlantic region. The Company also has participated with other financial institutions in selected construction and land development loans outside our geographic area. The Company has a concentration of credit risk in commercial real estate and construction and land development loans at December 31, 2013. | |||||||||||||
The Company classifies its leases as finance leases, in accordance with FASB ASC Topic 840, “Leases”. The difference between the Company’s gross investment in the lease and the cost or carrying amount of the leased property, if different, is recorded as unearned income, which is amortized to income over the lease term by the interest method. | |||||||||||||
For all classes of loans receivable, with the exception of tax certificates, the accrual of interest is discontinued on a loan when management believes that the borrower’s financial condition is such that collection of principal and interest is doubtful or when a loan becomes 90 days past due. When a loan is placed on non-accrual all unpaid interest is reversed from interest income. Interest payments received on impaired nonaccrual loans are normally applied against principal. Excess proceeds received over the principal amounts due on impaired loans are recognized as income on a cash basis. Generally, loans are restored to accrual status when the loan is brought current, has performed in accordance with the contractual terms for a reasonable period of time (generally six months) and the ultimate collectibility of the total contractual principal and interest is no longer in doubt. The past due status of all classes of loans receivable is determined based on contractual due dates for loan payments. Tax certificates have no contractual maturity. Collection is dependent upon the tax payer’s redemption of the lien, which includes principal interest and fees. | |||||||||||||
A loan modification is deemed a troubled debt restructuring (“TDR”) when two conditions are met: 1) the borrower is experiencing financial difficulty and 2) a concession is made by the Company that would not otherwise be considered for a borrower with similar credit risk characteristics. If in modifying a loan the Company, for economic or legal reasons related to a borrower’s financial difficulties, grants a concession it would not normally consider then the loan modification is classified as a TDR. All loans classified as TDRs are considered to be impaired. TDRs are returned to an accrual status when the loan is brought current, has performed in accordance with the contractual restructured terms for a reasonable period of time (generally six months) and the ultimate collectibility of the total contractual restructured principal and interest is no longer in doubt. The Company’s policy for TDRs is to recognize interest income on currently performing restructured loans under the accrual method. | |||||||||||||
The Company accounts for guarantees in accordance with FASB ASC Topic 460 “Guarantees” (“ASC Topic 460”). ASC Topic 460 requires a guarantor entity, at the inception of a guarantee covered by the measurement provisions of the interpretation, to record a liability for the fair value of the obligation undertaken in issuing the guarantee. The Company has financial and performance letters of credit. Financial letters of credit require the Company to make a payment if the customer’s condition deteriorates, as defined in agreements. Performance letters of credits require the Company to make payments if the customer fails to perform certain non-financial contractual obligations. | |||||||||||||
Allowance for Loan and Lease Losses | |||||||||||||
The Company’s loan and lease portfolio (the “credit portfolio”) is subject to varying degrees of credit risk. The Company maintains an allowance for loan and lease losses (the “allowance”) to absorb losses in the loan and lease portfolio. The allowance is based on the review and evaluation of the loan and lease portfolio, along with ongoing, quarterly assessments of the probable losses inherent in that portfolio. The allowance represents an estimation made pursuant to FASB ASC Topic 450, “Contingencies” (“ASC Topic 450”) or FASB ASC Topic 310, “Receivables” (“ASC Topic 310”). The adequacy of the allowance is determined through evaluation of the credit portfolio, and involves consideration of a number of factors, as outlined below, to establish a prudent level. | |||||||||||||
Determination of the allowance is inherently subjective and requires significant estimates, including estimated losses on pools of homogeneous loans and leases based on historical loss experience and consideration of current economic trends, which may be susceptible to significant change. Loans and leases deemed uncollectible are charged against the allowance, while recoveries are credited to the allowance. Management adjusts the level of the allowance through the provision for loan and lease losses, which is recorded as a current period expense. The Company’s systematic methodology for assessing the appropriateness of the allowance includes: (1) general reserves reflecting historical loss rates by loan type, (2) specific reserves for risk-rated credits based on probable losses on an individual or portfolio basis and (3) qualitative reserves based upon current economic conditions and other risk factors. | |||||||||||||
The loan portfolio is stratified into loan segments that have similar risk characteristics. The general allowance is based upon historical loss rates using a three-year rolling average of the historical loss experienced within each loan segment. The qualitative factors used to adjust the historical loss experience address various risk characteristics of the Company’s loan and lease portfolio include evaluating: (1) trends in delinquencies and other non-performing loans, (2) changes in the risk profile related to large loans in the portfolio, (3) changes in the growth trends of categories of loans comprising the loan and lease portfolio, (4) concentrations of loans and leases to specific industry segments, (5) changes in economic conditions on both a local and national level, (6) quality of loan review and board oversight, (7) changes in lending policies and procedures, and (8) changes in lending staff. Each factor is assigned a value to reflect improving, stable or declining conditions based on management’s best judgment using relevant information available at the time of the evaluation. Adjustments to the factors are supported through documentation of changes in conditions in a report accompanying the allowance calculation. | |||||||||||||
The allowance calculation methodology includes further segregation of loan classes into risk rating categories. The borrower’s overall financial condition, repayment sources, guarantors and value of collateral, if appropriate, are evaluated annually for commercial loans or when credit deficiencies arise, such as delinquent loan payments, for commercial and consumer loans. Credit quality risk ratings include regulatory classifications of special mention, substandard, doubtful and loss. Loans classified as special mention have potential weaknesses that deserve management’s close attention. If uncorrected, the potential weaknesses may result in deterioration of the repayment prospects. Loans classified as substandard have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They include loans that are inadequately protected by the current sound net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans classified as doubtful have all the weaknesses inherent in loans classified substandard with the added characteristic that collection or liquidation in full, on the basis of current conditions and facts, is highly improbable. Loans classified as a loss are considered uncollectible and are charged to the allowance for loan losses. Loans not classified are rated pass. | |||||||||||||
The specific reserves are determined utilizing standards required under ASC Topic 310. A loan is considered impaired when it is probable that interest and principal will not be collected according to the contractual terms of the loan agreement. Non-accrual loans and loans restructured under a TDR are evaluated for impairment on an individual basis considering all known relevant factors that may affect loan collectability such as the borrower’s overall financial condition, resources and payment record, support available from financial guarantors and the sufficiency of current collateral values (current appraisals or rent rolls for income producing properties), and risks inherent in different kinds of lending (such as source of repayment, quality of borrower and concentration of credit quality). Non-accrual loans that experience insignificant payment shortfalls generally are not classified as 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. | |||||||||||||
Impairment is measured on a loan by loan basis for commercial and industrial loans, commercial real estate loans and commercial construction loans by either the present value of expected future cash flows discounted at the loan’s effective interest rate or the fair value of the collateral if the loan is collateral dependent. The estimated fair values of substantially all of the Company’s impaired loans are measured based on the estimated fair value of the loan’s collateral. The Company obtains third-party appraisals or real estate brokers’ opinions (“BPOs”) to establish the fair value of real estate collateral. Appraised values or BPOs are discounted to arrive at the estimated selling price of the collateral, which is considered to be the estimated fair value. The discounts also include estimated costs to sell the property. For commercial and industrial loans secured by non-real estate collateral, such as accounts receivable, inventory and equipment, estimated fair values are determined based on the borrower’s financial statements, inventory reports, accounts receivable aging or equipment appraisals or invoices. Indications of value from these sources are generally discounted based on the age of the financial information or the quality of the assets. Large groups of smaller balance homogeneous loans are collectively evaluated for impairment. A specific reserve is established for an impaired loan for the amount that the carrying value exceeds its estimated fair value. Once a loan is determined to be impaired it will be deducted from the portfolio balance and the net remaining balance will be used in the general and qualitative analysis. | |||||||||||||
Based on management’s comprehensive analysis of the loan and lease portfolio, management believes the current level of the allowance is adequate at December 31, 2013. However, its determination requires significant judgment, and estimates of probable losses inherent in the credit portfolio can vary significantly from the amounts actually observed. While management uses available information to recognize probable losses, future changes to the allowance may be necessary. These changes could be based in the credits comprising the portfolio and changes in the financial condition of borrowers, as the result of changes in economic conditions. In addition, regulatory agencies, as an integral part of their examination process, periodically review the credit portfolio and the allowance. Such review may result in additional provisions based on their judgment of information available at the time of each examination, which may not be currently available to management. | |||||||||||||
Other Real Estate Owned | |||||||||||||
Assets acquired through, or in lieu of, loan foreclosure are held for sale and are initially recorded at fair value less costs to sell at the date of foreclosure, establishing a new cost basis. Foreclosed real estate properties acquired through the tax certificate portfolio are transferred at the lower of cost or fair value principally due to uncertainty around the fair value of the foreclosed properties. Subsequent to foreclosure, valuations are periodically performed by management and the assets are carried at the lower of carrying amount recorded at acquisition date or fair value less costs to sell. Third-party appraisals or agreements of sale are utilized to determine fair value the loan collateral while BPOs, agreements of sale, or in some cases, third-party appraisals are utilized to value properties from the tax certificate portfolio. Revenue and expenses from operations and changes in the valuation allowance are included in other expenses. For fair value measurement, OREO is included in level 3 assets. | |||||||||||||
Premises and Equipment | |||||||||||||
Land is carried at cost. Premises and equipment are stated at cost less accumulated depreciation, which is computed primarily using the modified accelerated cost recovery system (“MACRS”) over the estimated useful lives of the assets. Leasehold improvements are depreciated over the shorter of the estimated useful lives of the improvements or the terms of the related leases. Expected term includes lease options periods to the extent that the exercise of such options is reasonably assured. | |||||||||||||
Bank-Owned Life Insurance | |||||||||||||
Royal Bank has purchased life insurance policies on certain executives. These policies are reflected on the consolidated balance sheets at their cash surrender value, or the amount that can be realized. Income from these policies and changes in the cash surrender value are recorded in other income. | |||||||||||||
Advertising Costs | |||||||||||||
Advertising costs are expensed as incurred. The Company’s advertising costs were $209,000 and $127,000 for 2013 and 2012, respectively. | |||||||||||||
Benefit Plans | |||||||||||||
The Company has a noncontributory nonqualified, defined benefit pension plan covering certain eligible employees. The plan provides retirement benefits under pension trust agreements. The benefits are based on years of service and the employee’s compensation during the highest three consecutive years during the last 10 years of employment. Net pension expense consists of service costs and interest costs. The Company accrues pension costs as incurred. | |||||||||||||
The Company has a capital accumulation and salary reduction plan under Section 401(k) of the Internal Revenue Code of 1986, as amended. Under the plan, all employees are eligible to contribute up to the maximum allowed by Internal Revenue Service (“IRS”) regulation, with the Company matching 100% of any contribution between 1% and 5% subject to a $2,500 per employee annual limit. During 2013 and 2012, no matching contribution was made as a result of a management decision to reduce costs. | |||||||||||||
Stock Compensation | |||||||||||||
FASB ASC Topic 718, “Compensation-Stock Compensation” (“ASC Topic 718”) requires that the compensation cost relating to share-based payment transactions be recognized in consolidated financial statements. The costs are measured based on the fair value of the equity or liability instruments issued. ASC Topic 718 covers a wide range of share-based compensation arrangements including stock options, restricted share plans, performance-based awards, share appreciation rights, and employee share purchase plans. The effect of ASC Topic 718 is to require entities to measure the cost of employee services received in exchange for stock options based on the grant-date fair value of the award, and to recognize the cost over the period the employee is required to provide services for the award. ASC Topic 718 permits entities to use any option-pricing model that meets the fair value objective in the Statement. The Company recorded compensation expense relating to stock options and restricted stock of $22,000 and $42,000 during 2013 and 2012, respectively. | |||||||||||||
At December 31, 2013, the Company had a director stock-based plan, an employee stock-based plan, and a long-term incentive compensation plan, which are more fully described in “Note 17 – Stock Compensation Plans” to the Consolidated Financial Statements. | |||||||||||||
Trust Preferred Securities | |||||||||||||
Royal Bancshares Capital Trust I/II (“Trusts”) issued mandatory redeemable preferred stock to investors and loaned the proceeds to the Company. The Trusts hold, as their sole asset, subordinated debentures issued by the Company in 2004. The Company does not consolidate the Trusts as ASC Topic 810 precludes consideration of the call option embedded in the preferred stock when determining if the Company has the right to a majority of the Trusts expected returns. The non-consolidation results in the investment in common stock of the Trusts to be included in other assets with a corresponding increase in outstanding debt of $774,000. In addition, the income accrued on the Company’s common stock investments is included in other income. Refer to “Note 10 – Borrowings and Subordinated Debentures” to the Consolidated Financial Statements for more information. | |||||||||||||
Income Taxes | |||||||||||||
The Company accounts for income taxes in accordance with income tax accounting guidance (FASB ASC Topic 740, Income Taxes), which includes guidance related to accounting for uncertainty in income taxes, which sets out a consistent framework to determine the appropriate level of tax reserves to maintain for uncertain tax positions. The Company had no material unrecognized tax benefits or accrued interest and penalties as of December 31, 2013 and 2012. The Company’s policy is to account for interest as a component of interest expense and penalties as a component of other expense. | |||||||||||||
The Company and its subsidiaries file a consolidated federal income tax return. Income taxes are allocated to the Company and its subsidiaries based on the contribution of their income or use of their loss in the consolidated return. Separate state income tax returns are filed by the Company and its subsidiaries. The Company is subject to examination by taxing authorities for the years 2006, 2007 and 2009 through 2013. | |||||||||||||
Federal and state income taxes have been provided on the basis of reported income or loss. The amounts reflected on the tax returns differ from these provisions due principally to temporary differences in the reporting of certain items for financial reporting and income tax reporting purposes. The tax effect of these temporary differences is accounted for as deferred taxes applicable to future periods. Deferred income tax expense or benefit is determined by recognizing deferred tax assets and liabilities for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred assets and liabilities of a change in tax rates is recognized in earnings in the period that includes the enactment date. The realization of deferred tax assets is assessed and a valuation allowance provided for the full amount which is not more likely than not to be realized. | |||||||||||||
Treasury Stock | |||||||||||||
Shares of common stock repurchased are recorded as treasury stock at cost. | |||||||||||||
Earnings (Losses) Per Share Information | |||||||||||||
Basic per share data excludes dilution and is computed by dividing income (loss) available to common shareholders by the weighted average common shares outstanding during the period. Diluted per share data takes into account the potential dilution that could occur if securities or other contracts to issue common stock were exercised and converted into common stock, using the treasury stock method. | |||||||||||||
The Class B shares of the Company may be converted to Class A shares at the rate of 1.15 to 1. | |||||||||||||
Comprehensive Income (Loss) | |||||||||||||
The Company reports comprehensive income (loss) in accordance with FASB ASC Topic 220, “Comprehensive Income” (“ASC Topic 220”), which requires the reporting of all changes in equity during the reporting period except investments from and distributions to shareholders. Net income (loss) is a component of comprehensive income (loss) with all other components referred to in the aggregate as other comprehensive income (loss). Comprehensive income (loss) consists of net income (loss) and other comprehensive income (loss). Other comprehensive income (loss) includes unrealized gains and losses on available for sale investment securities, non-credit related losses on other-than-temporarily impaired investment securities, and adjustment to net periodic pension cost. | |||||||||||||
Fair Value of Financial Instruments | |||||||||||||
For information on the fair value of the Company’s financial instruments refer to “Note 20 - Fair Value of Financial Instruments” to the Consolidated Financial Statements. | |||||||||||||
Restrictions on Cash and Amounts Due From Banks | |||||||||||||
Royal Bank is required to maintain average balances on hand with the Federal Reserve Bank. At December 31, 2013 and 2012, these reserve balances amounted to $100,000. | |||||||||||||
2. Recent Accounting Pronouncements | |||||||||||||
In December 2011, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2011-11, Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities (“ASU 2011-11”). Because of the significant differences in requirements under U.S. GAAP and IFRS, FASB and the International Accounting Standards Board (“IASB”) are issuing joint requirements that will enhance current disclosures. Entities are required to disclose both gross information and net information about both instruments and transactions eligible for offset in the statement of financial position and instruments and transactions subject to an agreement similar to a master netting arrangement. This scope would include derivatives, sale and repurchase agreements and reverse sale and repurchase agreements, and securities borrowing and securities lending arrangements. The objective of this disclosure is to facilitate comparison between those entities that prepare their financial statements on the basis of U.S. GAAP and those entities that prepare their financial statements on the basis of IFRS. ASU 2011-11 is effective for annual periods beginning on or after January 1, 2013 and interim periods within those annual periods. An entity should provide the disclosures required by these amendments retrospectively for all comparative periods presented. The adoption of ASU 2011-11 did not have a significant impact on the Company’s consolidated financial statements. | |||||||||||||
In February 2013, the FASB issued ASU No. 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income (“ASU 2013-02”) to improve the reporting of reclassifications out of accumulated comprehensive income. ASU 2013-02 does not change the current requirements for reporting net income or other comprehensive income in financial statements. However, ASU 2013-02 requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, an entity is required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income but only if the amount reclassified is required under U.S. GAAP to be reclassified to net income in its entirety in the same reporting period. For other amounts that are not required under U.S. GAAP to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures required under U.S. GAAP that provide additional detail about those amounts. ASU 2013-02 is effective for reporting periods beginning after December 15, 2012. The adoption of ASU 2013-02 did not have a significant impact on the Company’s consolidated financial statements. | |||||||||||||
In February 2013, the FASB issued ASU No. 2013-04, Liabilities (Topic 405): Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation Is Fixed at the Reporting Date (ASU 2013-04). ASU 2013-04 provides guidance for the recognition, measurement and disclosure of obligations resulting from joint and several liability arrangements. ASU 2013-04 requires an entity to measure obligations resulting from joint and several liability arrangements for which the total amount of the obligation within the scope of this guidance is fixed at the reporting date, as the sum of the following: | |||||||||||||
a. The amount the reporting entity agreed to pay on the basis of its arrangement among its co-obligors | |||||||||||||
b. Any additional amount the reporting entity expects to pay on behalf of its co-obligors. | |||||||||||||
ASU 2013-04 also requires an entity to disclose the nature and amount of the obligation as well as other information about those obligations. For public companies ASU 2013-04 is effective for reporting periods beginning after December 15, 2013. The adoption of ASU 2013-04 is not expected to have a significant impact on the Company’s consolidated financial statements. | |||||||||||||
In July 2013, the FASB issued ASU No. 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (“ASU 2013-11”). Currently there is diversity in practice in the presentation of unrecognized tax benefits. The aim of ASU 2013-11 is to provide guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, similar tax loss, or tax credit carryforward exists. An unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, except for circumstances outlined in ASU 2013-11. For public companies ASU 2013-11 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. Early adoption is permitted. The adoption of ASU 2013-04 is not expected to have a significant impact on the Company’s consolidated financial statements. | |||||||||||||
In January 2014, FASB issued ASU No. 2014-04 Receivables (Topic 310): Troubled Debt Restructurings by Creditors (Subtopic 310-40) Reclassification of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure (“ASU 2014-04”). ASC Topic 310 includes guidance that states that a creditor should reclassify a collateralized mortgage loan such that the loan should be derecognized and the collateral asset recognized when it determines that there has been in substance a repossession or foreclosure by the creditor, that is, the creditor receives physical possession of the debtor’s assets regardless of whether formal foreclosure proceedings take place. However, the terms in substance a repossession or foreclosure and physical possession are not defined in the accounting literature and there is diversity about when a creditor should derecognize the loan receivable and recognize the real estate property. That diversity has been highlighted by recent extended foreclosure timelines and processes related to residential real estate properties. | |||||||||||||
The objectives in ASU 2014-04 are intended to reduce diversity in practice by clarifying when an in substance repossession or foreclosure occurs, that is, when a creditor should be considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan such that the loan should be derecognized and the real estate property recognized. Holding foreclosed real estate property presents different operational and economic risk to creditors compared with holding an impaired loan. Therefore, consistency in the timing of loan derecognition and presentation of foreclosed real estate properties is of qualitative significance to users of the creditor’s financial statements. Additionally, the disclosure of the amount of foreclosed residential real estate properties and of the recorded investment in consumer mortgage loans secured by residential real estate properties that are in the process of foreclosure is expected to provide decision-useful information to many users of the creditor’s financial statements. The amendments in ASU 2014-04 are effective for public business entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2014. An entity can elect to adopt the amendments in ASU 2014-04 using either a modified retrospective transition method or a prospective transition method. Early adoption is permitted. Early adoption is permitted. The adoption of ASU 2014-04 is not expected to have a significant impact on the Company’s consolidated financial statements. | |||||||||||||
REGULATORY_MATTERS_and_SIGNIFI
REGULATORY MATTERS and SIGNIFICANT RISKS and UNCERTAINTIES | 12 Months Ended |
Dec. 31, 2013 | |
REGULATORY MATTERS and SIGNIFICANT RISKS and UNCERTAINTIES [Abstract] | ' |
REGULATORY MATTERS and SIGNIFICANT RISKS and UNCERTAINTIES | ' |
NOTE 2 – REGULATORY MATTERS and SIGNIFICANT RISKS and UNCERTAINTIES | |
FDIC and Department of Banking Memorandum of Understanding | |
During the fourth quarter of 2011, Royal Bank entered into an informal agreement, known as a memorandum of understanding (“MOU”) with each of the FDIC and the Pennsylvania Department of Banking (the “Department”). Included in the MOU is the requirement of maintaining a ratio of Tier 1 capital to total assets (“leverage ratio”) equal to or greater than 8% and a total risk-based capital ratio equal to or greater than 12%. At December 31, 2013, based on capital levels calculated under RAP, Royal Bank’s leverage and total risk-based capital ratios were 9.13% and 15.61%, respectively. Please refer to “Note 15 – Regulatory Capital Requirements” to the Consolidated Financial Statements. | |
Federal Reserve Memorandum of Understanding | |
As previously disclosed, in March 2010, the Company agreed to enter into a written agreement (the “Federal Reserve Agreement”) with the Federal Reserve Bank of Philadelphia (the “Federal Reserve Bank”). In July 2013, the Board of Governors of the Federal Reserve System terminated the enforcement action under Federal Reserve Agreement, and it was replaced with an informal non-public agreement, an MOU, with the Federal Reserve Bank, effective July 17, 2013. Included in the MOU are certain continued reporting requirements and a requirement that the Company receive the prior approval of the Federal Reserve Bank prior to declaring or paying any dividends on the Company’s common stock, making interest payments related to the Company’s outstanding trust preferred securities or subordinate securities, incurring or guaranteeing certain debt with an original maturity date greater than one year, and purchasing or redeeming any shares of stock. The MOU will remain in effect until stayed, modified, terminated or suspended in writing by the Federal Reserve Bank. | |
Our success as a Company is dependent upon pursuing various alternatives in not only achieving the growth and expansion of our banking franchise but also in managing our day to day operations. The existence of the two MOUs may limit or impact our ability to pursue all previously available alternatives in the management of the Company. Our ability to retain existing retail and commercial customers as well as the ability to attract potentially new customers may be impacted by the existence of the MOUs. Additionally, the Company’s ability to raise capital in the current economic environment could be potentially limited or impacted as a result of the MOUs. Attracting new management talent is critical to the success of our business and could be potentially effected due to the existence of the MOUs. | |
2013 Net Income | |
For the five years prior to 2013, the Company had recorded significant losses totaling $118.2 million which were primarily related to charge-offs on the loan and lease portfolio, impairment charges on investment securities, impairment charges on OREO, credit related expenses and the establishment of a deferred tax valuation allowance. In addition to reducing the total shareholders’ equity, the accumulated deficit impacts the Company’s ability to pay cash dividends to its shareholders now and in future years. For 2013, the Company recorded net income of $2.1 million compared to a net loss of $15.6 million in 2012. Declines in credit related expenses, provision for loan and lease losses, OTTI on investment securities, salaries and benefits and professional and legal fees of $7.4 million, $6.9 million, $2.4 million, $1.3 million and $1.2 million, respectively, positively impacted 2013 results. Included in net income for 2013 were $2.5 million in gains on the sale of company owned real estate and an increase of $1.1 million in net gains on the sale of OREO properties. Partially offsetting these positive items was a $1.9 million decrease in net interest income, a $1.4 million decrease in gains on sales of loans and leases, and an $872,000 decline in gains on sale of investment securities. The Company’s deferred tax valuation allowance amounted to $37.2 million at the end of 2013. The deferred tax valuation allowance is a result of management’s conclusion that it was more likely than not that the Company would not generate sufficient future taxable income to realize all of the deferred tax assets. | |
Credit Quality | |
The financial services and real estate industries were hit particularly hard during the “Great Recession” and as a result the Company’s loan and investment portfolios were directly affected. The Company’s commercial real estate loans, including construction and land development loans, saw a decline in the collateral values and a reduction in the borrowers’ ability to meet the payment terms of their loans due to reduced cash flow. Further declines in collateral values and borrowers’ liquidity with sustained unemployment at current levels may lead to additional increases in foreclosures, delinquencies and customer bankruptcies. The Company is less able than a larger institution to spread the risks of unfavorable local economic conditions across a large number of more diverse economies. | |
The Company has been successful in reducing net classified loans, which includes LHFS, and OREO. Net classified loans were $32.2 million and $51.8 million at December 31, 2013 and 2012, respectively. The Company had total non-performing loans and recorded charge-offs of $10.2 million and $3.9 million at December 31, 2013, compared to $23.0 million and $6.3 million at December 31, 2012, respectively. OREO balances were $9.6 million and $13.4 million at December 31, 2013 and 2012, respectively. The Company’s delinquent loans held for investment (30 to 89 days) amounted to $2.6 million and $4.6 million at December 31, 2013 and 2012, respectively. No material advances were made on any classified or delinquent loan unless approved by the board of directors and determined to be in Royal Bank’s best interest. The Company has restructured the investment portfolio to reduce credit risk by selling corporate debt securities and equity securities and replacing their maturities with U.S. government issued or sponsored securities. Other-than-temporary-impairment losses were $0 at December 31, 2013 compared to $2.4 million at December 31, 2012. | |
Liquidity and Funds Management | |
Royal Bank previously had limited capacity to borrow additional funds in the event it was needed for liquidity purposes. However, Royal Bank has continued to maintain liquidity measures that are in excess of the target levels. During the third quarter of 2013, the FHLB released Royal Bank from the over collateralized delivery requirement of 105% subject to reevaluation on a quarterly basis. Additionally during the fourth quarter of 2013 the FHLB released Royal Bank from loan-level listing status. As of December 31, 2013, Royal Bank had approximately $190.0 million of available borrowing capacity at the FHLB as a result of the two collateral restrictions being removed. Royal Bank also has availability to borrow from the Federal Reserve Discount Window, which was approximately $7.2 million at December 31, 2013, and was based on collateral pledged. Borrowings were $107.9 million and $108.3 million at December 31, 2013 and 2012, respectively. | |
At December 31, 2013, the liquidity to deposits ratio was 72.2% compared to Royal Bank’s 12% policy target and the liquidity to total liabilities ratio was 55.8% compared to Royal Bank’s 10% policy target. The Company also has unfunded pension plan obligations of $14.5 million as of December 31, 2013 which potentially could impact liquidity. The Company plans to fund the pension plan obligations through existing Company owned life insurance policies. | |
Dividend and Interest Restrictions | |
Due to the MOU, our ability to obtain lines of credit, to receive attractive collateral treatment from funding sources, and to pursue all attractive funding alternatives in this current low interest rate environment could be impacted and thereby limit liquidity alternatives. On August 13, 2009, the Company’s Board suspended the regular quarterly cash dividends on the $30.4 million in Series A Preferred Stock and the interest payments on the $25.8 million in trust preferred securities. As of December 31, 2013, the Series A Preferred stock dividend in arrears was $7.7 million and has not been recognized in the consolidated financial statements. The Company believes the decision to suspend the preferred cash dividends will better support the liquidity position of Royal Bank. During the third quarter of 2013, the Company received approval from the Federal Reserve Bank to pay the $3.1 million interest payment in arrears on the trust preferred securities. On September 16, 2013, the Company became current and is current on the interest payments on the trust preferred securities which included an interest penalty of $174,000. The Company received approval and paid the fourth quarter interest payment in December 2013. | |
At December 31, 2013 and 2012, as a result of significant losses within Royal Bank, the Company had an accumulated deficit and therefore would not have been able to declare and pay any cash dividends. Royal Bank must receive prior approval from the FDIC and the Department before declaring and paying a dividend to the Company. Under the Federal Reserve MOU the Company may not declare or pay any dividends or make interest payments related to the Company’s outstanding trust preferred securities or subordinate securities, without the prior written approval of the Reserve Bank and the Director of the Division of Banking Supervision and Regulation of the Board of Governors of the Federal Reserve System. | |
Capital Adequacy | |
In connection with a prior bank regulatory examination, the FDIC concluded, based upon its interpretation of the Call Report instructions and under RAP, that income from Royal Bank’s tax lien business should be recognized on a cash basis, not an accrual basis. Royal Bank’s current accrual method is in accordance with U.S. GAAP. Royal Bank disagrees with the FDIC’s conclusion and filed the Call Report for December 31, 2013 and the previous 13 quarters in accordance with U.S. GAAP. However, the change in the manner of revenue recognition for the tax lien business for regulatory accounting purposes affects Royal Bank’s and potentially the Company’s capital ratios as disclosed in “Note 15 - Regulatory Capital Requirements” to the Consolidated Financial Statements. The resolution of this matter will be decided by additional joint regulatory agency guidance which includes the Federal Reserve Bank, the FDIC, and OCC. | |
Under the MOU, Royal Bank must maintain a minimum Tier 1 leverage ratio and a minimum total risk-based capital ratio of 8% and 12%, respectively. At December 31, 2013, based on capital levels calculated under RAP, Royal Bank’s leverage and total risk-based capital ratios were 9.13% and 15.61%, respectively. | |
Company Plans and Strategy | |
During the past few years, the Company recorded significant impairment charges and carrying costs on non-accrual loans and OREO which has weighed heavily on earnings and was the largest contributing factor to the Company’s losses. The Company’s strategic plan included improving the overall level of credit quality, maintaining reduced credit risk within the investment portfolio, reducing the overall level of expenses, and returning to profitability. The Board and management remain committed to meeting the capital level requirements for Royal Bank as set forth in the FDIC MOU. As a result, the Board and management developed a contingency plan to maintain capital ratios at required levels. This strategy also assisted in reducing the level of classified assets by giving management the ability to actively pursue exit strategies on loans and OREO which were at historically high levels. | |
While sustaining capital ratios above the required minimum, the Company has made progress in improving credit quality, reducing the CRE concentration, strengthening the Board and maintaining liquidity. As a result of the decline in level of classified assets, there has been a corresponding reduction in the provision for loan and lease losses and the overall carrying costs associated with classified assets. The deleveraging of the balance sheet has also reduced earning assets which has resulted in a decline in net interest income and has had a significant impact on overall earnings. To improve net interest margin and net interest income, management is diligently working on changing the mix of earning assets and interest-bearing liabilities. In the event further deleveraging is necessary to maintain the required capital levels, net interest income would be negatively impacted. | |
For 2013, the strategic plan evolved into transitioning Royal Bank into a community bank built on a solid commercial revenue and retail delivery foundation. During the first quarter of 2013, to support the strategic goals, management had announced a set of sweeping initiatives through the Company's "Profitability Improvement Plan" ("PIP") designed to enhance company-wide efficiency, productivity and modernization. During 2013, the Company realized a 22% reduction in the workforce, which included reorganizing and relocating certain personnel to improve departmental synergies and better align managers and staff so they can work together in cohesive teams to accomplish their objectives. The Company recorded a restructuring charge of $87,000 related to the reduction in workforce. The Company also finalized a unique opportunity to reduce employee expenses as eight individuals became employees of a local company that provides servicing of the remaining tax lien and non-performing assets portfolios. Those portfolios continue to diminish per the Company's strategic plan. This outsourcing arrangement enables the Company to focus on the expansion of its core banking products while de-emphasizing legacy non-core activity such as tax liens. | |
During 2013, pursuant to the real estate rationalization plan under PIP, two branches were consolidated and four Company-owned buildings were sold. Royal Bank consolidated the leased Henderson Road office between the King of Prussia and Bridgeport offices and consolidated the 15th Street branch office into the Walnut Street branch office, which are both located in Center City Philadelphia. These branch consolidations had minimal effect on deposit levels. Included in the real estate sales were two buildings that are the sites of the Fairmount and Phoenixville retail branches. In refreshing our retail branch network, these two branches along with a third will be relocated to more attractive, convenient, high-traffic locations within the same markets over the next three to eight months. Additionally the Villanova branch was relocated in January 2014. | |
During 2013, the Company launched a completely redesigned website which takes advantage of the latest technologies and trends in web development, including responsive design which reformats content to fit any screen, improving both aesthetics and user experience. Visitors will also find a renewed emphasis on our most important products and services, including quick links to key revenue driving product lines and our secure home equity application. Complementing the launch of the new website was the debut of our mobile banking solution, TouchBanking. With the addition to executive management of Lars Eller, as Chief Retail Banking Officer, the Company looks to grow its retail customer base with the deployment of new commercial and consumer solutions, enhancement of product offerings and further development of the retail sales teams. To support the marketing of these enhancements the Company began refreshing its brand with new advertising through billboards and online and print media. The expense reductions, revenue growth and planned additional improvements have repositioned the Company in 2013 and for the future. | |
INVESTMENT_SECURITIES
INVESTMENT SECURITIES | 12 Months Ended | ||||||||||||||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||||||||||||||
INVESTMENT SECURITIES [Abstract] | ' | ||||||||||||||||||||||||||||||||||||
INVESTMENT SECURITIES | ' | ||||||||||||||||||||||||||||||||||||
NOTE 3 - INVESTMENT SECURITIES | |||||||||||||||||||||||||||||||||||||
The amortized cost, gross unrealized gains and losses, and fair value of the Company’s available-for-sale investment securities are summarized as follows: | |||||||||||||||||||||||||||||||||||||
As of December 31, 2013 | Included in AOCL* | ||||||||||||||||||||||||||||||||||||
(In thousands) | Amortized | Gross | Gross | Fair value | |||||||||||||||||||||||||||||||||
cost | unrealized | unrealized | |||||||||||||||||||||||||||||||||||
gains | losses | ||||||||||||||||||||||||||||||||||||
Investment securities available-for-sale | |||||||||||||||||||||||||||||||||||||
U.S. government agencies | $ | 68,207 | $ | - | $ | (6,171 | ) | $ | 62,036 | ||||||||||||||||||||||||||||
Mortgage-backed securities-residential | 32,769 | 210 | (882 | ) | 32,097 | ||||||||||||||||||||||||||||||||
Collateralized mortgage obligations: | |||||||||||||||||||||||||||||||||||||
Issued or guaranteed by U.S. government agencies | 188,194 | 2,887 | (1,978 | ) | 189,103 | ||||||||||||||||||||||||||||||||
Non-agency | 4,454 | 25 | - | 4,479 | |||||||||||||||||||||||||||||||||
Corporate bonds | 9,669 | 25 | (256 | ) | 9,438 | ||||||||||||||||||||||||||||||||
Municipal bonds | 7,163 | - | (263 | ) | 6,900 | ||||||||||||||||||||||||||||||||
Common stocks | 33 | 16 | - | 49 | |||||||||||||||||||||||||||||||||
Other securities | 3,363 | 1,405 | (143 | ) | 4,625 | ||||||||||||||||||||||||||||||||
Total available for sale | $ | 313,852 | $ | 4,568 | $ | (9,693 | ) | $ | 308,727 | ||||||||||||||||||||||||||||
As of December 31, 2012 | Included in AOCL* | ||||||||||||||||||||||||||||||||||||
(In thousands) | Amortized | Gross | Gross | Fair value | |||||||||||||||||||||||||||||||||
cost | unrealized | unrealized | |||||||||||||||||||||||||||||||||||
gains | losses | ||||||||||||||||||||||||||||||||||||
Investment securities available-for-sale | |||||||||||||||||||||||||||||||||||||
U.S. government agencies | $ | 66,371 | $ | 151 | $ | (78 | ) | $ | 66,444 | ||||||||||||||||||||||||||||
Mortgage-backed securities-residential | 30,038 | 518 | (47 | ) | 30,509 | ||||||||||||||||||||||||||||||||
Collateralized mortgage obligations: | |||||||||||||||||||||||||||||||||||||
Issued or guaranteed by U.S. government agencies | 229,556 | 5,031 | (611 | ) | 233,976 | ||||||||||||||||||||||||||||||||
Non-agency | 1,007 | 4 | - | 1,011 | |||||||||||||||||||||||||||||||||
Corporate bonds | 7,477 | 32 | (72 | ) | 7,437 | ||||||||||||||||||||||||||||||||
Municipal bonds | 5,645 | - | (30 | ) | 5,615 | ||||||||||||||||||||||||||||||||
Common stocks | 33 | 14 | - | 47 | |||||||||||||||||||||||||||||||||
Other securities | 3,752 | 520 | (108 | ) | 4,164 | ||||||||||||||||||||||||||||||||
Total available for sale | $ | 343,879 | $ | 6,270 | $ | (946 | ) | $ | 349,203 | ||||||||||||||||||||||||||||
* | Accumulated other comprehensive loss | ||||||||||||||||||||||||||||||||||||
The investment portfolio declined $40.5 million from $349.2 million at December 31, 2012 to $308.7 million at December 31, 2013. The decline was partially due to the reinvestment of cash flows from principal payments and calls into loans and the $10.4 million change to a net unrealized loss of $5.1 million at December 31, 2013 from a net unrealized gain of $5.3 million at December 31, 2012. | |||||||||||||||||||||||||||||||||||||
The amortized cost and fair value of investment securities at December 31, 2013, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. | |||||||||||||||||||||||||||||||||||||
As of December 31, 2013 | |||||||||||||||||||||||||||||||||||||
(In thousands) | Amortized | Fair value | |||||||||||||||||||||||||||||||||||
cost | |||||||||||||||||||||||||||||||||||||
Within 1 year | $ | 11,806 | $ | 10,257 | |||||||||||||||||||||||||||||||||
After 1 but within 5 years | 6,432 | 6,359 | |||||||||||||||||||||||||||||||||||
After 5 but within 10 years | 33,519 | 31,246 | |||||||||||||||||||||||||||||||||||
After 10 years | 33,282 | 30,512 | |||||||||||||||||||||||||||||||||||
Mortgage-backed securities-residential | 32,769 | 32,097 | |||||||||||||||||||||||||||||||||||
Collateralized mortgage obligations: | |||||||||||||||||||||||||||||||||||||
Issued or guaranteed by U.S. government agencies | 188,194 | 189,103 | |||||||||||||||||||||||||||||||||||
Non-agency | 4,454 | 4,479 | |||||||||||||||||||||||||||||||||||
Total available for sale debt securities | 310,456 | 304,053 | |||||||||||||||||||||||||||||||||||
No contractual maturity | 3,396 | 4,674 | |||||||||||||||||||||||||||||||||||
Total available for sale securities | $ | 313,852 | $ | 308,727 | |||||||||||||||||||||||||||||||||
Proceeds from the sales of investments available for sale during 2013 and 2012 were $31.0 million and $28.2 million, respectively. The following table summarizes gross realized gains and losses realized on the sale of securities recognized in earnings in the periods indicated: | |||||||||||||||||||||||||||||||||||||
For the years ended December 31, | |||||||||||||||||||||||||||||||||||||
(In thousands) | 2013 | 2012 | |||||||||||||||||||||||||||||||||||
Gross realized gains | $ | 416 | $ | 1,211 | |||||||||||||||||||||||||||||||||
Gross realized losses | (258 | ) | (181 | ) | |||||||||||||||||||||||||||||||||
Net realized gains | $ | 158 | $ | 1,030 | |||||||||||||||||||||||||||||||||
As of December 31, 2013, investment securities with a market value of $70.4 million were pledged as collateral to secure advances with the FHLB. | |||||||||||||||||||||||||||||||||||||
The Company evaluates securities for OTTI at least on a quarterly basis. The Company assesses whether OTTI is present when the fair value of a security is less than its amortized cost. All investment securities are evaluated for OTTI under FASB ASC Topic 320, “Investments-Debt & Equity Securities” (“ASC Topic 320”). Non-agency collateralized mortgage obligations maybe evaluated under FASB ASC Topic 320 Subtopic 40, “Beneficial Interests in Securitized Financial Assets” or under FASB ASC Topic 325, “Investments-Other”. In determining whether OTTI exists, management considers numerous factors, including but not limited to: (1) the length of time and the extent to which the fair value is less than the amortized cost, (2) the Company’s intent to hold or sell the security, (3) the financial condition and results of the issuer including changes in capital, (4) the credit rating of the issuer, (5) analysts’ earnings estimate, (6) industry trends specific to the security, and (7) timing of debt maturity and status of debt payments. | |||||||||||||||||||||||||||||||||||||
Under ASC Topic 320, OTTI is considered to have occurred with respect to debt securities (1) if an entity intends to sell the security; (2) if it is more likely than not an entity will be required to sell the security before recovery of its amortized cost basis; or (3) the present value of the expected cash flows is not sufficient to recover the entire amortized cost basis. In addition, the amount of the OTTI recognized in earnings depends on whether an entity intends to sell or will more likely than not be required to sell the security. If an entity intends to sell the security or will be required to sell the security, the OTTI shall be recognized in earnings equal to the entire difference between the fair value and the amortized cost basis at the balance sheet date. If an entity does not intend to sell the security and it is not more likely than not that the entity will be required to sell the security before the recovery of its amortized cost basis, the OTTI shall be separated into two amounts, the credit-related loss and the noncredit-related loss. The credit-related loss is based on the present value of the expected cash flows and is recognized in earnings. The noncredit-related loss is based on other factors such as illiquidity and is recognized in other comprehensive income (loss). | |||||||||||||||||||||||||||||||||||||
The tables below indicate the length of time individual securities have been in a continuous unrealized loss position at December 31, 2013 and 2012: | |||||||||||||||||||||||||||||||||||||
As of December 31, 2013 | Less than 12 months | 12 months or longer | Total | ||||||||||||||||||||||||||||||||||
(In thousands) | Fair value | Gross | Number of | Fair value | Gross | Number of | Fair value | Gross | Number of | ||||||||||||||||||||||||||||
unrealized | positions | unrealized | positions | unrealized | positions | ||||||||||||||||||||||||||||||||
losses | losses | losses | |||||||||||||||||||||||||||||||||||
Investment securities available for sale | |||||||||||||||||||||||||||||||||||||
U.S. government agencies | $ | 48,919 | $ | (5,035 | ) | 16 | $ | 12,267 | $ | (1,136 | ) | 5 | $ | 61,186 | $ | (6,171 | ) | 21 | |||||||||||||||||||
Mortgage-backed securities-residential | 18,045 | (518 | ) | 7 | 6,276 | (364 | ) | 2 | 24,321 | (882 | ) | 9 | |||||||||||||||||||||||||
Collateralized mortgage obligations: | |||||||||||||||||||||||||||||||||||||
Issued or guaranteed by U.S. government agencies | 67,240 | (1,446 | ) | 21 | 9,974 | (532 | ) | 3 | 77,214 | (1,978 | 24 | ||||||||||||||||||||||||||
) | |||||||||||||||||||||||||||||||||||||
Corporate bonds | 4,848 | (221 | ) | 5 | 965 | (35 | ) | 1 | 5,813 | (256 | ) | 6 | |||||||||||||||||||||||||
Municipal bonds | 3,019 | (102 | ) | 5 | 3,881 | (161 | ) | 4 | 6,900 | (263 | ) | 9 | |||||||||||||||||||||||||
Other securities | - | - | - | 301 | (143 | ) | 2 | 301 | (143 | ) | 2 | ||||||||||||||||||||||||||
Total available for sale | $ | 142,071 | $ | (7,322 | ) | 54 | $ | 33,664 | $ | (2,371 | ) | 17 | $ | 175,735 | $ | (9,693 | ) | 71 | |||||||||||||||||||
As of December 31, 2012 | Less than 12 months | 12 months or longer | Total | ||||||||||||||||||||||||||||||||||
(In thousands) | Fair value | Gross | Number | Fair value | Gross | Number of | Fair value | Gross | Number | ||||||||||||||||||||||||||||
unrealized | of | unrealized | positions | unrealized | of | ||||||||||||||||||||||||||||||||
losses | positions | losses | losses | positions | |||||||||||||||||||||||||||||||||
Investment securities available for sale | |||||||||||||||||||||||||||||||||||||
U.S. government agencies | $ | 23,818 | $ | (78 | ) | 8 | $ | - | $ | - | - | $ | 23,818 | $ | (78 | ) | 8 | ||||||||||||||||||||
Mortgage-backed securities-residential | 7,280 | (47 | ) | 2 | - | - | - | 7,280 | (47 | ) | 2 | ||||||||||||||||||||||||||
Collateralized mortgage obligations: | |||||||||||||||||||||||||||||||||||||
Issued or guaranteed by U.S. government agencies | 44,937 | (592 | ) | 15 | 3,975 | (19 | ) | 2 | 48,912 | (611 | 17 | ||||||||||||||||||||||||||
) | |||||||||||||||||||||||||||||||||||||
Corporate bonds | 2,165 | (13 | ) | 2 | 941 | (59 | ) | 1 | 3,106 | (72 | ) | 3 | |||||||||||||||||||||||||
Municipal bonds | 4,597 | (21 | ) | 5 | 882 | (9 | ) | 1 | 5,479 | (30 | ) | 6 | |||||||||||||||||||||||||
Other securities | 289 | (38 | ) | 1 | 255 | (70 | ) | 1 | 544 | (108 | ) | 2 | |||||||||||||||||||||||||
Total available for sale | $ | 83,086 | $ | (789 | ) | 33 | $ | 6,053 | $ | (157 | ) | 5 | $ | 89,139 | $ | (946 | ) | 38 | |||||||||||||||||||
The AFS portfolio had gross unrealized losses of $9.7 million and $946,000 at December 31, 2013 and 2012, respectively. The considerable increase in gross unrealized losses was directly impacted by increases of $6.2 million, $1.4 million and $835,000 in gross unrealized losses on government agency debt securities, Agency CMOs, and MBS, respectively. These securities carry lower coupons and their market value was negatively impacted by a 72% increase in the 10-year Treasury yield from 1.76% at December 31, 2012 to 3.03% at December 31, 2013. The Company did not record OTTI charges in 2013. In determining the Company’s intent not to sell and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost basis, management considers the following factors: current liquidity and availability of other non-pledged assets that permits the investment to be held for an extended period of time but not necessarily until maturity, capital planning, and any specific investment committee goals or guidelines related to the disposition of specific investments. | |||||||||||||||||||||||||||||||||||||
Common stocks: As of December 31, 2013, the Company had two common stocks of financial institutions with a total fair value of $49,000 and an unrealized gain of $16,000. During 2012 the Company sold one common stock investment and recorded a gain of $112,000. | |||||||||||||||||||||||||||||||||||||
For all debt security types discussed below the fair value is based on prices provided by brokers and safekeeping custodians with the exception of trust preferred securities which is described below. | |||||||||||||||||||||||||||||||||||||
U.S. government-sponsored agencies (“US Agencies”): As of December 31, 2013, the Company had 21 US Agency bonds, which are callable at par, with a fair value of $61.2 million and gross unrealized losses of $5.0 million. Sixteen of these US Agencies have been in an unrealized loss position for less than twelve months. The five bonds that have been in an unrealized loss position for more twelve months or longer had a fair market value of $12.3 million and unrealized losses of $1.2 million at December 31, 2013. Management believes that the unrealized loss on these debt securities is a function of changes in investment spreads. Management expects to recover the entire amortized cost basis of these securities. The Company does not intend to sell the securities before recovery of the cost basis and will not more likely than not be required to sell these securities before recovery of the cost basis. Therefore, management has determined that these securities are not other-than-temporarily impaired at December 31, 2013. | |||||||||||||||||||||||||||||||||||||
Mortgage-backed securities issued by U.S. government agencies and U.S. government sponsored enterprises: As of December 31, 2013, the Company had nine mortgage-backed securities with a fair value of $24.3 million and gross unrealized losses of $882,000. Two of the mortgage-backed securities had been in an unrealized loss position of twelve months or longer and the remaining seven mortgage-backed securities have been in an unrealized loss position for less than twelve months. The unrealized loss is attributable to a combination of factors, including relative changes in interest rates since the time of purchase. The contractual cash flows for these securities are guaranteed by U.S. government agencies and U.S. government-sponsored enterprises. Based on its assessment of these factors, management believes that the unrealized losses on these debt securities are a function of changes in investment spreads and interest rate movements and not changes in credit quality. Management expects to recover the entire amortized cost basis of these securities. The Company does not intend to sell these securities before recovery of their cost basis and will not more likely than not be required to sell these securities before recovery of their cost basis. Therefore, management has determined that these securities are not other-than-temporarily impaired at December 31, 2013. | |||||||||||||||||||||||||||||||||||||
U.S. government issued or sponsored collateralized mortgage obligations (“Agency CMOs”): As of December 31, 2013, the Company had 24 Agency CMOs with a fair value of $77.2 million and gross unrealized losses of $2.0 million. Three of the Agency CMOs had been in an unrealized loss position for twelve months or longer and the remaining 21 Agency CMOs have been in an unrealized loss position for less than twelve months. The unrealized loss is attributable to a combination of factors, including relative changes in interest rates since the time of purchase. The contractual cash flows for these securities are guaranteed by U.S. government agencies and U.S. government-sponsored enterprises. Based on its assessment of these factors, management believes that the unrealized losses on these debt securities are a function of changes in investment spreads and interest rate movements and not changes in credit quality. Management expects to recover the entire amortized cost basis of these securities. The Company does not intend to sell these securities before recovery of their cost basis and will not more likely than not be required to sell these securities before recovery of their cost basis. Therefore, management has determined that these securities are not other-than-temporarily impaired at December 31, 2013. | |||||||||||||||||||||||||||||||||||||
Non-agency collateralized mortgage obligations (“Non-agency CMOs”): As of December 31, 2013, the Company had two non-agency CMOs with a fair value of $4.5 million and a gross unrealized gain of $25,000. | |||||||||||||||||||||||||||||||||||||
Corporate bonds: As of December 31, 2013, the Company had six corporate bonds with a fair value of $5.8 million and gross unrealized losses of $256,000. One of the corporate bonds had been in an unrealized loss position for more than twelve months and the remaining five bonds have been in an unrealized loss position for less than twelve months. All six bonds are investment grade. The Company’s unrealized losses in investments in corporate bonds represent interest rate risk and not credit risk of the underlying issuers. As previously mentioned management also considered (1) the length of time and the extent to which the fair value is less than the amortized cost, (2) the Company’s intent to hold or sell the security, (3) the financial condition and results of the issuer including changes in capital, (4) the credit rating of the issuer, (5) analysts’ earnings estimate, (6) industry trends specific to the security, and (7) timing of debt maturity and status of debt payments. Management utilized discounted cash flow analysis based upon the credit ratings of the securities, liquidity risk premiums, and the recent corporate spreads for similar securities as required under ASC Topic 320 to determine the credit risk component of the corporate bonds. Based on these analyses, there was no credit-related loss on the bonds. Because the Company does not intend to sell the corporate bonds and it is not more likely than not that the Company will be required to sell the bonds before recovery of their amortized cost basis, which may be maturity, the Company does not consider these bonds to be other-than-temporarily impaired at December 31, 2013. | |||||||||||||||||||||||||||||||||||||
Municipal bonds: As of December 31, 2013, the Company had nine municipal bonds with a fair value $6.9 million and an unrealized loss of $263,000. Five of the municipal bonds have been in an unrealized loss position for less than twelve months and four municipal bonds have been in an unrealized loss position for more twelve months or longer. Because the Company does not intend to sell the bonds and it is not more likely than not that the Company will be required to sell the bonds before recovery of its amortized cost basis, which may be maturity, the Company does not consider the bonds to be other-than-temporarily impaired at December 31, 2013. | |||||||||||||||||||||||||||||||||||||
Other securities: As of December 31, 2013, the Company had seven investments in private equity funds which were predominantly invested in real estate. In determining whether or not OTTI exists, the Company reviews the funds’ financials, asset values, and its near-term projections. At December 31, 2013, two of the private equity funds had a combined fair value of $301,000 and an unrealized loss of $143,000. OTTI charges were recorded in a prior period on these two funds. Management concluded that there was no additional impairment on these two funds in 2013. During 2012 the Company recorded impairment charges on two other private equity funds. The impairment charges included the entire carrying value of one of the private equity funds in the amount of $1.5 million and a credit related impairment charge of $859,000 on another private equity fund. | |||||||||||||||||||||||||||||||||||||
The Company will continue to monitor all of the above investments to determine if the discounted cash flow analysis, continued negative trends, market valuations or credit defaults result in impairment that is other-than-temporary. | |||||||||||||||||||||||||||||||||||||
The following table presents a roll-forward of the balance of credit-related impairment losses on debt securities held at December 31, 2013 and 2012 for which a portion of an other-than-temporary impairment was recognized in other comprehensive income: | |||||||||||||||||||||||||||||||||||||
(In thousands) | 2013 | 2012 | |||||||||||||||||||||||||||||||||||
Balance at January 1, | $ | 173 | $ | 173 | |||||||||||||||||||||||||||||||||
Reductions for securities sold during the period (realized) | (173 | ) | - | ||||||||||||||||||||||||||||||||||
Balance at December 31, | $ | - | $ | 173 | |||||||||||||||||||||||||||||||||
The following table summarizes other-than-temporary impairment losses on securities recognized in earnings in the periods indicated: | |||||||||||||||||||||||||||||||||||||
For the years ended December 31, | |||||||||||||||||||||||||||||||||||||
(In thousands) | 2013 | 2012 | |||||||||||||||||||||||||||||||||||
Other securities | $ | - | $ | 2,359 | |||||||||||||||||||||||||||||||||
Total OTTI recognized in earnings | $ | - | $ | 2,359 | |||||||||||||||||||||||||||||||||
During 2012, the Company recorded a total impairment charge to earnings of $2.4 million related to other securities. Management concluded that these investments were OTTI. |
LOANS_AND_LEASES
LOANS AND LEASES | 12 Months Ended | ||||||||||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||||||||||
LOANS AND LEASES [Abstract] | ' | ||||||||||||||||||||||||||||||||
LOANS AND LEASES | ' | ||||||||||||||||||||||||||||||||
NOTE 4 – LOANS AND LEASES | |||||||||||||||||||||||||||||||||
Major classifications of LHFI are as follows: | |||||||||||||||||||||||||||||||||
As of December 31, | |||||||||||||||||||||||||||||||||
(In thousands) | 2013 | 2012 | |||||||||||||||||||||||||||||||
Commercial real estate | $ | 148,293 | $ | 167,115 | |||||||||||||||||||||||||||||
Construction and land development | 45,261 | 37,215 | |||||||||||||||||||||||||||||||
Commercial and industrial | 79,589 | 40,560 | |||||||||||||||||||||||||||||||
Multi-family | 11,737 | 11,756 | |||||||||||||||||||||||||||||||
Residential real estate | 25,535 | 24,981 | |||||||||||||||||||||||||||||||
Leases | 42,524 | 37,347 | |||||||||||||||||||||||||||||||
Tax certificates | 12,716 | 24,569 | |||||||||||||||||||||||||||||||
Consumer | 826 | 1,139 | |||||||||||||||||||||||||||||||
366,481 | 344,682 | ||||||||||||||||||||||||||||||||
Less: Deferred loan fees, net* | - | (517 | ) | ||||||||||||||||||||||||||||||
Total LHFI, net of unearned income | $ | 366,481 | $ | 344,165 | |||||||||||||||||||||||||||||
*For the 2013 period net deferred fees were allocated among the various loan types. | |||||||||||||||||||||||||||||||||
The Company originates commercial and real estate loans, including construction and land development loans primarily in the greater Philadelphia metropolitan area as well as selected locations throughout the mid-Atlantic region. The Company also has participated with other financial institutions in selected construction and land development loans outside our geographic area. The Company has a concentration of credit risk in commercial real estate, construction and land development loans at December 31, 2013. A substantial portion of its debtors’ ability to honor their contracts is dependent upon the housing sector specifically and the economy in general. | |||||||||||||||||||||||||||||||||
The Company has originated loans to the officers and directors of the Company and to their associates. In accordance with Regulation O, related party loans are made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with unrelated persons and do not involve more than normal risk of collectability. The aggregate dollar amount of these loans and commitments was $234,000 and $1.4 million at December 31, 2013 and 2012. During 2013 there were no new related party loans. Total payments received on related party loans in 2013 were $1.2 million. | |||||||||||||||||||||||||||||||||
The Company uses a nine point grading risk classification system commonly used in the financial services industry as the credit quality indicator. The first four classifications are rated Pass. The riskier classifications include Pass-Watch, Special Mention, Substandard, Doubtful and Loss. The risk rating is related to the underlying credit quality and probability of default. These risk ratings are used to calculate the historical loss component of the allowance. | |||||||||||||||||||||||||||||||||
· | Pass: includes credits that demonstrate a low probability of default; | ||||||||||||||||||||||||||||||||
· | Pass-Watch: a warning classification which includes credits that are beginning to demonstrate above average risk through declining earnings, strained cash flows, increased leverage and/or weakening market fundamentals; | ||||||||||||||||||||||||||||||||
· | Special mention: includes credits that have potential weaknesses that if left uncorrected could weaken the credit or result in inadequate protection of the Company’s position at some future date. While potentially weak, credits in this classification are marginally acceptable and loss of principal or interest is not anticipated; | ||||||||||||||||||||||||||||||||
· | Substandard accrual: includes credits that exhibit a well-defined weakness which currently jeopardizes the repayment of debt and liquidation of collateral even though they are currently performing. These credits are characterized by the distinct possibility that the Company may incur a loss in the future if these weaknesses are not corrected; | ||||||||||||||||||||||||||||||||
· | Non-accrual: (substandard non-accrual, doubtful, loss): includes credits that demonstrate serious problems to the point that it is probable that interest and principal will not be collected according to the contractual terms of the loan agreement. | ||||||||||||||||||||||||||||||||
All loans, at the time of presentation to the appropriate loan committee, are given an initial loan risk rating by the Chief Credit Officer (“CCO”). From time to time, and at the general direction of any of the various loan committees, the ratings may be changed based on the findings of that committee. Items considered in assigning ratings include the financial strength of the borrower and/or guarantors, the type of collateral, the collateral lien position, the type of loan and loan structure, any potential risk inherent in the specific loan type, higher than normal monitoring of the loan or any other factor deemed appropriate by any of the various committees for changing the rating of the loan. Any such change in rating is reflected in the minutes of that committee. | |||||||||||||||||||||||||||||||||
The following tables present risk ratings for each loan portfolio segment at December 31, 2013 and 2012, excluding LHFS. | |||||||||||||||||||||||||||||||||
As of December 31, 2013 | Special | ||||||||||||||||||||||||||||||||
(In thousands) | Pass | Pass-Watch | Mention | Substandard | Non-accrual | Total | |||||||||||||||||||||||||||
Commercial real estate | $ | 99,525 | $ | 32,267 | $ | 11,572 | $ | 2,604 | $ | 2,325 | $ | 148,293 | |||||||||||||||||||||
Construction and land development | 14,677 | 16,270 | 11,095 | 569 | 2,650 | 45,261 | |||||||||||||||||||||||||||
Commercial & industrial | 50,478 | 10,508 | 5,735 | 9,239 | 3,629 | 79,589 | |||||||||||||||||||||||||||
Multi-family | 10,792 | 410 | 535 | - | - | 11,737 | |||||||||||||||||||||||||||
Residential real estate | 24,903 | - | - | - | 632 | 25,535 | |||||||||||||||||||||||||||
Leases | 41,325 | 485 | 247 | - | 467 | 42,524 | |||||||||||||||||||||||||||
Tax certificates | 12,262 | - | - | - | 454 | 12,716 | |||||||||||||||||||||||||||
Consumer | 750 | 76 | - | - | - | 826 | |||||||||||||||||||||||||||
Total LHFI | $ | 254,712 | $ | 60,016 | $ | 29,184 | $ | 12,412 | $ | 10,157 | $ | 366,481 | |||||||||||||||||||||
As of December 31, 2012 | Special | ||||||||||||||||||||||||||||||||
(In thousands) | Pass | Pass-Watch | Mention | Substandard | Non-accrual | Total | |||||||||||||||||||||||||||
Commercial real estate | $ | 64,308 | $ | 69,510 | $ | 19,529 | $ | 3,423 | $ | 10,345 | $ | 167,115 | |||||||||||||||||||||
Construction and land development | 2,139 | 13,872 | 16,343 | 581 | 4,280 | 37,215 | |||||||||||||||||||||||||||
Commercial & industrial | 14,764 | 10,774 | 92 | 9,969 | 4,961 | 40,560 | |||||||||||||||||||||||||||
Multi-family | 9,019 | 2,034 | 703 | - | - | 11,756 | |||||||||||||||||||||||||||
Residential real estate | 15,125 | 6,634 | 602 | 1,626 | 994 | 24,981 | |||||||||||||||||||||||||||
Leases | 36,755 | 325 | 16 | - | 251 | 37,347 | |||||||||||||||||||||||||||
Tax certificates | 23,968 | - | - | - | 601 | 24,569 | |||||||||||||||||||||||||||
Consumer | 926 | 213 | - | - | - | 1,139 | |||||||||||||||||||||||||||
Subtotal LHFI | 167,004 | 103,362 | 37,285 | 15,599 | 21,432 | 344,682 | |||||||||||||||||||||||||||
Less: Deferred loan fees | (517 | ) | |||||||||||||||||||||||||||||||
Total LHFI | $ | 344,165 | |||||||||||||||||||||||||||||||
The following tables are an aging analysis of past due payments for each loan portfolio segment at December 31, 2013 and 2012, excluding LHFS. | |||||||||||||||||||||||||||||||||
As of December 31, 2013 | 30-59 Days | 60-89 Days | Accruing | Total | |||||||||||||||||||||||||||||
(In thousands) | Past Due | Past Due | 90+ Days | Non-accrual | Current | Total | |||||||||||||||||||||||||||
Commercial real estate | $ | 996 | $ | - | $ | - | $ | 2,325 | $ | 144,972 | $ | 148,293 | |||||||||||||||||||||
Construction and land development | - | - | - | 2,650 | 42,611 | 45,261 | |||||||||||||||||||||||||||
Commercial & industrial | 115 | 49 | - | 3,629 | 75,796 | 79,589 | |||||||||||||||||||||||||||
Multi-family | - | - | - | - | 11,737 | 11,737 | |||||||||||||||||||||||||||
Residential real estate | 458 | 262 | - | 632 | 24,183 | 25,535 | |||||||||||||||||||||||||||
Leases | 485 | 247 | - | 467 | 41,325 | 42,524 | |||||||||||||||||||||||||||
Tax certificates | - | - | - | 454 | 12,262 | 12,716 | |||||||||||||||||||||||||||
Consumer | - | - | - | - | 826 | 826 | |||||||||||||||||||||||||||
Total LHFI | $ | 2,054 | $ | 558 | $ | - | $ | 10,157 | $ | 353,712 | $ | 366,481 | |||||||||||||||||||||
As of December 31, 2012 | 30-59 Days | 60-89 Days | Accruing | Total | |||||||||||||||||||||||||||||
(In thousands) | Past Due | Past Due | 90+ Days | Non-accrual | Current | Total | |||||||||||||||||||||||||||
Commercial real estate | $ | 1,548 | $ | 1,486 | $ | - | $ | 10,345 | $ | 153,736 | $ | 167,115 | |||||||||||||||||||||
Construction and land development | - | - | - | 4,280 | 32,935 | 37,215 | |||||||||||||||||||||||||||
Commercial & industrial | 200 | - | - | 4,961 | 35,399 | 40,560 | |||||||||||||||||||||||||||
Multi-family | - | - | - | - | 11,756 | 11,756 | |||||||||||||||||||||||||||
Residential real estate | 562 | 486 | - | 994 | 22,939 | 24,981 | |||||||||||||||||||||||||||
Leases | 325 | 16 | - | 251 | 36,755 | 37,347 | |||||||||||||||||||||||||||
Tax certificates | - | - | - | 601 | 23,968 | 24,569 | |||||||||||||||||||||||||||
Consumer | - | - | - | - | 1,139 | 1,139 | |||||||||||||||||||||||||||
Subtotal LHFI | 2,635 | 1,988 | - | 21,432 | 318,627 | 344,682 | |||||||||||||||||||||||||||
Less: Deferred loan fees | (517 | ) | |||||||||||||||||||||||||||||||
Total LHFI | $ | 344,165 | |||||||||||||||||||||||||||||||
The following table details the composition of the non-accrual loans. | |||||||||||||||||||||||||||||||||
As of December 31, 2013 | As of December 31, 2012 | ||||||||||||||||||||||||||||||||
(In thousands) | Loan | Specific | Loan | Specific | |||||||||||||||||||||||||||||
balance | reserves | balance | reserves | ||||||||||||||||||||||||||||||
Non-accrual loans held for investment | |||||||||||||||||||||||||||||||||
Commercial real estate | $ | 2,325 | $ | 331 | $ | 10,345 | $ | 835 | |||||||||||||||||||||||||
Construction and land development | 2,650 | - | 4,280 | 820 | |||||||||||||||||||||||||||||
Commercial & industrial | 3,629 | 452 | 4,961 | 255 | |||||||||||||||||||||||||||||
Residential real estate | 632 | 19 | 994 | 14 | |||||||||||||||||||||||||||||
Leases | 467 | 60 | 251 | 55 | |||||||||||||||||||||||||||||
Tax certificates | 454 | 24 | 601 | 47 | |||||||||||||||||||||||||||||
Total non-accrual LHFI | $ | 10,157 | $ | 886 | $ | 21,432 | $ | 2,026 | |||||||||||||||||||||||||
Non-accrual loans held for sale | |||||||||||||||||||||||||||||||||
Commercial real estate | $ | - | $ | - | $ | 1,572 | $ | - | |||||||||||||||||||||||||
Total non-accrual LHFS | $ | - | $ | - | $ | 1,572 | $ | - | |||||||||||||||||||||||||
Total non-accrual loans | $ | 10,157 | $ | 886 | $ | 23,004 | $ | 2,026 | |||||||||||||||||||||||||
Total non-accrual loans at December 31, 2013 were $10.2 million in LHFI. Total non-accrual loans at December 31, 2012 were $23.0 million and were comprised of $21.4 million in LHFI and $1.6 million in LHFS. The $12.8 million decline in total non-accrual loans was the result of a $13.2 million reduction in existing non-accrual loan balances through payments or payoffs, $4.0 million in charge-offs and write downs related to impairment, and transfers to OREO of $9.1 million, which collectively were offset by $13.5 million in additions. The majority of the new non-accrual activity and transfers to OREO originated from the tax certificate portfolio. Commercial, construction and land development, and commercial real estate loans represent 36%, 26%, and 23%, respectively, of the total $10.2 million in non-accrual loans at December 31, 2013. If interest had been accrued, such income would have been approximately $1.7 million and $3.1 million for the years ended December 31, 2013 and 2012, respectively. At December 31, 2013, the Company had no loans past due 90 days or more on which interest continues to accrue. | |||||||||||||||||||||||||||||||||
Impaired Loans | |||||||||||||||||||||||||||||||||
The Company identifies a loan as impaired when it is probable that interest and principal will not be collected according to the contractual terms of the loan agreement. Impaired loans include TDRs. The Company does not accrue interest income on impaired non-accrual loans. Excess proceeds received over the principal amounts due on impaired non-accrual loans are recognized as income on a cash basis. The Company recognizes income under the accrual basis when the principal payments on the loans become current and the collateral on the loan is sufficient to cover the outstanding obligation to the Company. If these factors do not exist, the Company does not recognize income. | |||||||||||||||||||||||||||||||||
Total cash collected on impaired loans and leases during 2013 and 2012 was $16.1 million and $23.4 million, respectively, of which $15.3 million and $21.1 million was credited to the principal balance outstanding on such loans, respectively. | |||||||||||||||||||||||||||||||||
The following is a summary of information pertaining to impaired loans: | |||||||||||||||||||||||||||||||||
As of December 31, | |||||||||||||||||||||||||||||||||
(In thousands) | 2013 | 2012 | |||||||||||||||||||||||||||||||
Impaired LHFI with a valuation allowance | $ | 3,835 | $ | 9,405 | |||||||||||||||||||||||||||||
Impaired LHFI without a valuation allowance | 14,671 | 19,423 | |||||||||||||||||||||||||||||||
Impaired LHFS | - | 1,572 | |||||||||||||||||||||||||||||||
Total impaired loans and leases | $ | 18,506 | $ | 30,400 | |||||||||||||||||||||||||||||
Valuation allowance related to impaired LHFI | $ | 886 | $ | 2,026 | |||||||||||||||||||||||||||||
For the years ended December 31, | |||||||||||||||||||||||||||||||||
(In thousands) | 2013 | 2012 | |||||||||||||||||||||||||||||||
Average investment in impaired loans and leases | $ | 24,714 | $ | 39,412 | |||||||||||||||||||||||||||||
Interest income recognized on impaired loans and leases | $ | 559 | $ | 366 | |||||||||||||||||||||||||||||
Interest income recognized on a cash basis on impaired loans and leases | $ | 27 | $ | 66 | |||||||||||||||||||||||||||||
Troubled Debt Restructurings | |||||||||||||||||||||||||||||||||
At December 31, 2013, the Company had twelve TDRs, of which five are on non-accrual status, with a total carrying value of $12.1 million. At the time of the modifications, five of the loans were already classified as impaired loans. At December 31, 2012, the Company had twelve TDRs, of which eight were on non-accrual status, with a total carrying value of $21.1 million. At the time of the modifications, eight of the loans were already classified as impaired loans. The Company’s policy for TDRs is to recognize interest income on currently performing restructured loans under the accrual method. The TDR balances are included in the impaired loan totals presented above. | |||||||||||||||||||||||||||||||||
The following table details the Company’s TDRs that are on an accrual status and a non-accrual status at December 31, 2013 and 2012. | |||||||||||||||||||||||||||||||||
As of December 31, 2013 | |||||||||||||||||||||||||||||||||
(In thousands) | Number of | Accrual | Non-Accrual | Total TDRs | |||||||||||||||||||||||||||||
loans | Status | Status | |||||||||||||||||||||||||||||||
Commercial real estate | 3 | $ | 3,847 | $ | - | $ | 3,847 | ||||||||||||||||||||||||||
Construction and land development | 4 | 1,257 | 479 | 1,736 | |||||||||||||||||||||||||||||
Commercial & industrial | 3 | 4,420 | 1,960 | 6,380 | |||||||||||||||||||||||||||||
Residential real estate | 2 | - | 121 | 121 | |||||||||||||||||||||||||||||
Total | 12 | $ | 9,524 | $ | 2,560 | $ | 12,084 | ||||||||||||||||||||||||||
As of December 31, 2012 | |||||||||||||||||||||||||||||||||
(In thousands) | Number of | Accrual | Non-Accrual | Total TDRs | |||||||||||||||||||||||||||||
loans | Status | Status | |||||||||||||||||||||||||||||||
Commercial real estate | 4 | $ | 1,664 | $ | 854 | $ | 2,518 | ||||||||||||||||||||||||||
Construction and land development | 4 | 613 | 10,063 | 10,676 | |||||||||||||||||||||||||||||
Commercial & industrial | 2 | 5,290 | 2,457 | 7,747 | |||||||||||||||||||||||||||||
Residential real estate | 2 | - | 149 | 149 | |||||||||||||||||||||||||||||
Total | 12 | $ | 7,567 | $ | 13,523 | $ | 21,090 | ||||||||||||||||||||||||||
At December 31, 2013, all of the TDRs were in compliance with their restructured terms. | |||||||||||||||||||||||||||||||||
The following table presents newly restructured loans that occurred during the years ended December 31, 2013 and 2012. | |||||||||||||||||||||||||||||||||
Modifications by type for the year ended December 31, 2013 | |||||||||||||||||||||||||||||||||
(Dollars in thousands) | Number of | Rate | Term | Payment | Combination | Total | Pre- | Post- | |||||||||||||||||||||||||
loans | of types | Modification Outstanding | Modification Outstanding | ||||||||||||||||||||||||||||||
Recorded | Recorded | ||||||||||||||||||||||||||||||||
Investment | Investment | ||||||||||||||||||||||||||||||||
Commercial real estate | 2 | $ | - | $ | - | $ | - | $ | 3,705 | $ | 3,705 | $ | 3,761 | $ | 3,761 | ||||||||||||||||||
Commercial & industrial | 1 | - | - | - | 82 | 82 | 87 | 87 | |||||||||||||||||||||||||
Total | 3 | $ | - | $ | - | $ | - | $ | 3,787 | $ | 3,787 | $ | 3,848 | $ | 3,848 | ||||||||||||||||||
Modifications by type for the year ended December 31, 2012 | |||||||||||||||||||||||||||||||||
(Dollars in thousands) | Number of | Rate | Term | Payment | Combination | Total | Pre- | Post- | |||||||||||||||||||||||||
loans | of types | Modification Outstanding | Modification Outstanding | ||||||||||||||||||||||||||||||
Recorded | Recorded | ||||||||||||||||||||||||||||||||
Investment | Investment | ||||||||||||||||||||||||||||||||
Commercial real estate | 2 | $ | - | $ | - | $ | - | $ | 7,624 | $ | 7,624 | $ | 9,426 | $ | 9,426 | ||||||||||||||||||
Construction and land development | 1 | - | - | - | 282 | 282 | 290 | 290 | |||||||||||||||||||||||||
Commercial & industrial | 1 | - | - | 5,290 | - | 5,290 | 5,290 | 5,290 | |||||||||||||||||||||||||
Total | 4 | $ | - | $ | - | $ | 5,290 | $ | 7,906 | $ | 13,196 | $ | 15,006 | $ | 15,006 | ||||||||||||||||||
ALLOWANCE_FOR_LOAN_AND_LEASE_L
ALLOWANCE FOR LOAN AND LEASE LOSSES | 12 Months Ended | ||||||||||||||||||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||||||||||||||||||
Allowance for Loan and Lease Losses [Abstract] | ' | ||||||||||||||||||||||||||||||||||||||||
ALLOWANCE FOR LOAN AND LEASE LOSSES | ' | ||||||||||||||||||||||||||||||||||||||||
NOTE 5 – ALLOWANCE FOR LOAN AND LEASE LOSSES | |||||||||||||||||||||||||||||||||||||||||
The following table presents the detail of the allowance and the loan portfolio disaggregated by loan portfolio segment as of December 31, 2013 and 2012. | |||||||||||||||||||||||||||||||||||||||||
Allowance for Loan and Leases Losses and Loans Held for Investment | |||||||||||||||||||||||||||||||||||||||||
For the year ended December 31, 2013 | |||||||||||||||||||||||||||||||||||||||||
(In thousands) | Commercial | Construction | Commercial & industrial | Multi-family | Residential | Leases | Tax | Consumer | Unallocated | Total | |||||||||||||||||||||||||||||||
real estate | and land development | real estate | certificates | ||||||||||||||||||||||||||||||||||||||
Allowance for Loan and Leases Losses | |||||||||||||||||||||||||||||||||||||||||
Beginning balance | $ | 8,750 | $ | 2,987 | $ | 1,924 | $ | 654 | $ | 1,098 | $ | 1,108 | $ | 472 | $ | 29 | $ | 239 | $ | 17,261 | |||||||||||||||||||||
Charge-offs | (1,684 | ) | (820 | ) | (383 | ) | - | (46 | ) | (382 | ) | (578 | ) | - | - | (3,893 | ) | ||||||||||||||||||||||||
Recoveries | 600 | 297 | 17 | - | 158 | 29 | 74 | - | - | 1,175 | |||||||||||||||||||||||||||||||
(Credit) provision | (2,168 | ) | (148 | ) | 1,448 | (252 | ) | (737 | ) | 468 | 587 | (14 | ) | (56 | ) | (872 | ) | ||||||||||||||||||||||||
Ending balance | $ | 5,498 | $ | 2,316 | $ | 3,006 | $ | 402 | $ | 473 | $ | 1,223 | $ | 555 | $ | 15 | $ | 183 | $ | 13,671 | |||||||||||||||||||||
Ending balance: related to loans individually evaluated for impairment | $ | 331 | $ | - | $ | 452 | $ | - | $ | 19 | $ | 60 | $ | 24 | $ | - | $ | - | $ | 886 | |||||||||||||||||||||
Ending balance: related to loans collectively evaluated for impairment | $ | 5,167 | $ | 2,316 | $ | 2,554 | $ | 402 | $ | 454 | $ | 1,163 | $ | 531 | $ | 15 | $ | 183 | $ | 12,785 | |||||||||||||||||||||
LHFI | |||||||||||||||||||||||||||||||||||||||||
Ending balance | $ | 148,293 | $ | 45,261 | $ | 79,589 | $ | 11,737 | $ | 25,535 | $ | 42,524 | $ | 12,716 | $ | 826 | $ | - | $ | 366,481 | |||||||||||||||||||||
Ending balance: individually evaluated for impairment | $ | 5,325 | $ | 3,907 | $ | 8,049 | $ | - | $ | 632 | $ | 139 | $ | 454 | $ | - | $ | - | $ | 18,506 | |||||||||||||||||||||
Ending balance: collectively evaluated for impairment | $ | 142,968 | $ | 41,354 | $ | 71,540 | $ | 11,737 | $ | 24,903 | $ | 42,385 | $ | 12,262 | $ | 826 | $ | - | $ | 347,975 | |||||||||||||||||||||
Allowance for Loan and Leases Losses and Loans Held for Investment | |||||||||||||||||||||||||||||||||||||||||
For the year ended December 31, 2012 | |||||||||||||||||||||||||||||||||||||||||
(In thousands) | Commercial real estate | Construction and land development | Commercial & industrial | Multi-family | Residential | Leases | Tax | Consumer | Unallocated | Total | |||||||||||||||||||||||||||||||
real estate | certificates | ||||||||||||||||||||||||||||||||||||||||
Allowance for Loan and Leases Losses | |||||||||||||||||||||||||||||||||||||||||
Beginning balance | $ | 7,744 | $ | 2,523 | $ | 2,331 | $ | 531 | $ | 1,188 | $ | 1,311 | $ | 425 | $ | 20 | $ | 307 | $ | 16,380 | |||||||||||||||||||||
Charge-offs | (1,313 | ) | (2,452 | ) | (586 | ) | (542 | ) | (111 | ) | (465 | ) | (802 | ) | - | - | (6,271 | ) | |||||||||||||||||||||||
Recoveries | 3 | 816 | 67 | - | 208 | 32 | 29 | - | - | 1,155 | |||||||||||||||||||||||||||||||
Provision (credit) | 2,316 | 2,100 | 112 | 665 | (187 | ) | 230 | 820 | 9 | (68 | ) | 5,997 | |||||||||||||||||||||||||||||
Ending balance | $ | 8,750 | $ | 2,987 | $ | 1,924 | $ | 654 | $ | 1,098 | $ | 1,108 | $ | 472 | $ | 29 | $ | 239 | $ | 17,261 | |||||||||||||||||||||
Ending balance: related to loans individually evaluated for impairment | $ | 835 | $ | 820 | $ | 255 | $ | - | $ | 14 | $ | 55 | $ | 47 | $ | - | $ | - | $ | 2,026 | |||||||||||||||||||||
Ending balance: related to loans collectively evaluated for impairment | $ | 7,915 | $ | 2,167 | $ | 1,669 | $ | 654 | $ | 1,084 | $ | 1,053 | $ | 425 | $ | 29 | $ | 239 | $ | 15,235 | |||||||||||||||||||||
LHFI | |||||||||||||||||||||||||||||||||||||||||
Ending balance | $ | 167,115 | $ | 37,215 | $ | 40,560 | $ | 11,756 | $ | 24,981 | $ | 37,347 | $ | 24,569 | $ | 1,139 | $ | - | $ | 344,682 | |||||||||||||||||||||
Ending balance: individually evaluated for impairment | $ | 10,958 | $ | 5,943 | $ | 10,251 | $ | - | $ | 994 | $ | 81 | $ | 601 | $ | - | $ | - | $ | 28,828 | |||||||||||||||||||||
Ending balance: collectively evaluated for impairment | $ | 156,157 | $ | 31,272 | $ | 30,309 | $ | 11,756 | $ | 23,987 | $ | 37,266 | $ | 23,968 | $ | 1,139 | $ | - | $ | 315,854 | |||||||||||||||||||||
The following tables detail the impaired LHFI by loan segment. | |||||||||||||||||||||||||||||||||||||||||
As of December 31, 2013 | |||||||||||||||||||||||||||||||||||||||||
(In thousands) | Unpaid | Recorded | Related | Average | Interest | ||||||||||||||||||||||||||||||||||||
principal | investment | allowance | recorded investment | income | |||||||||||||||||||||||||||||||||||||
balance | recognized | ||||||||||||||||||||||||||||||||||||||||
With no related allowance recorded: | |||||||||||||||||||||||||||||||||||||||||
Commercial real estate | $ | 4,429 | $ | 4,158 | $ | - | $ | 7,956 | $ | 73 | |||||||||||||||||||||||||||||||
Construction and land development | 9,850 | 3,907 | - | 3,933 | 209 | ||||||||||||||||||||||||||||||||||||
Commercial and industrial | 6,693 | 6,491 | - | 5,960 | 250 | ||||||||||||||||||||||||||||||||||||
Residential real estate | - | - | - | 84 | 27 | ||||||||||||||||||||||||||||||||||||
Tax certificates | 179 | 115 | - | 167 | - | ||||||||||||||||||||||||||||||||||||
Total: | $ | 21,151 | $ | 14,671 | $ | - | $ | 18,100 | $ | 559 | |||||||||||||||||||||||||||||||
With an allowance recorded: | |||||||||||||||||||||||||||||||||||||||||
Commercial real estate | $ | 1,435 | $ | 1,435 | $ | 331 | $ | 1,879 | $ | - | |||||||||||||||||||||||||||||||
Construction and land development | - | - | - | 381 | - | ||||||||||||||||||||||||||||||||||||
Commercial and industrial | 2,592 | 1,290 | 452 | 2,456 | - | ||||||||||||||||||||||||||||||||||||
Residential real estate | 827 | 631 | 19 | 492 | - | ||||||||||||||||||||||||||||||||||||
Leases | 139 | 139 | 60 | 106 | - | ||||||||||||||||||||||||||||||||||||
Tax certificates | 4,322 | 340 | 24 | 341 | - | ||||||||||||||||||||||||||||||||||||
Total: | $ | 9,315 | $ | 3,835 | $ | 886 | $ | 5,655 | $ | - | |||||||||||||||||||||||||||||||
As of December 31, 2012 | |||||||||||||||||||||||||||||||||||||||||
(In thousands) | Unpaid | Recorded | Related | Average | Interest | ||||||||||||||||||||||||||||||||||||
principal | investment | allowance | recorded | income | |||||||||||||||||||||||||||||||||||||
balance | investment | recognized | |||||||||||||||||||||||||||||||||||||||
With no related allowance recorded: | |||||||||||||||||||||||||||||||||||||||||
Commercial real estate | $ | 10,417 | $ | 8,623 | $ | - | $ | 11,163 | $ | 78 | |||||||||||||||||||||||||||||||
Construction and land development | 6,250 | 3,464 | - | 10,059 | 187 | ||||||||||||||||||||||||||||||||||||
Commercial and industrial | 7,790 | 6,820 | - | 5,545 | 73 | ||||||||||||||||||||||||||||||||||||
Multi-family | - | - | - | 780 | - | ||||||||||||||||||||||||||||||||||||
Residential real estate | 572 | 516 | - | 490 | 21 | ||||||||||||||||||||||||||||||||||||
Tax certificates | - | - | - | 583 | - | ||||||||||||||||||||||||||||||||||||
Total: | $ | 25,029 | $ | 19,423 | $ | - | $ | 28,620 | $ | 359 | |||||||||||||||||||||||||||||||
With an allowance recorded: | |||||||||||||||||||||||||||||||||||||||||
Commercial real estate | $ | 4,136 | $ | 2,335 | $ | 835 | $ | 1,526 | $ | - | |||||||||||||||||||||||||||||||
Construction and land development | 6,180 | 2,479 | 820 | 923 | - | ||||||||||||||||||||||||||||||||||||
Commercial and industrial | 9,585 | 3,431 | 255 | 682 | - | ||||||||||||||||||||||||||||||||||||
Multi-family | - | - | - | 383 | - | ||||||||||||||||||||||||||||||||||||
Residential real estate | 685 | 478 | 14 | 714 | 7 | ||||||||||||||||||||||||||||||||||||
Leases | 81 | 81 | 55 | 86 | - | ||||||||||||||||||||||||||||||||||||
Tax certificates | 4,408 | 601 | 47 | 288 | - | ||||||||||||||||||||||||||||||||||||
Total: | $ | 25,075 | $ | 9,405 | $ | 2,026 | $ | 4,602 | $ | 7 | |||||||||||||||||||||||||||||||
OTHER_REAL_ESTATE_OWNED
OTHER REAL ESTATE OWNED | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
OTHER REAL ESTATE OWNED [Abstract] | ' | ||||||||||||
OTHER REAL ESTATE OWNED | ' | ||||||||||||
NOTE 6 – OTHER REAL ESTATE OWNED | |||||||||||||
OREO declined $3.8 million from $13.4 million at December 31, 2012 to $9.6 million at December 31, 2013. During 2013 there was a shift in OREO composition from real estate acquired through, or in lieu of foreclosure in settlement of loans to real estate acquired through foreclosure related to tax liens. Set forth below is a table which details the changes in OREO from December 31, 2012 to December 31, 2013. | |||||||||||||
For the year ended December 31, 2013 | |||||||||||||
(In thousands) | Loans | Tax Liens | Total | ||||||||||
Beginning balance | $ | 11,365 | $ | 2,070 | $ | 13,435 | |||||||
Net proceeds from sales | (8,869 | ) | (3,910 | ) | (12,779 | ) | |||||||
Net gain on sales | 228 | 1,199 | 1,427 | ||||||||||
Assets acquired on non-accrual loans | 100 | 8,951 | 9,051 | ||||||||||
Impairment charge | (1,099 | ) | (418 | ) | (1,517 | ) | |||||||
Ending balance | $ | 1,725 | $ | 7,892 | $ | 9,617 | |||||||
At December 31, 2013, OREO was comprised of $7.9 million in tax liens, $769,000 in land, $521,000 in commercial real estate, and a residential condominium project with a fair value of $435,000. During 2013 the Company sold five separate land parcels and sold residential real estate properties related to five loan relationships. The Company received $6.0 million in net proceeds and recorded a net loss of $194,000 as a result of these sales. Additionally, the Company sold a commercial real estate property, which was a hotel construction project in Minneapolis, Minnesota in which the Company was a participant. The Company received its pro rata share of net proceeds in the amount of $2.5 million and recorded a net gain of $262,000. The Company also sold 42 condominiums related to the construction project in Minneapolis, Minnesota. The Company received its pro rata share of net proceeds in the amount of $330,000 and recorded net gains of $160,000. During 2013 the Company recorded impairment charges of $628,000 on three land properties. Due to the length of time that these properties have been classified as OREO and the inability to close on prior agreements of sales, the Company decided to a make a steep reduction in the selling prices of these three properties. In addition the Company recorded impairment charges of $325,000 and $146,000 related to commercial real estate and residential real estate properties due to updated annual appraisals or agreements of sale. | |||||||||||||
In 2013 as the composition of the OREO assets evolved to properties acquired through the tax lien portfolio, the Company transferred $9.0 million to OREO which represents 84 separate properties. During 2013, the Company sold 49 of the tax lien properties, received proceeds of $3.9 million, and recorded net gains of $1.2 million as a result of these sales. Additionally, the Company recorded impairment charges of $418,000 in 2013 related to the tax lien properties. At December 31, 2012, OREO assets acquired through the tax lien portfolio were $2.1 million and were comprised of 30 properties. | |||||||||||||
The Company is working to satisfactorily sell the remaining OREO properties. However the Company recognizes that the successful disposition of the properties, specifically the land, will likely take considerable time. | |||||||||||||
PREMISES_AND_EQUIPMENT
PREMISES AND EQUIPMENT | 12 Months Ended | |||||||||
Dec. 31, 2013 | ||||||||||
PREMISES AND EQUIPMENT [Abstract] | ' | |||||||||
PREMISES AND EQUIPMENT | ' | |||||||||
NOTE 7 - PREMISES AND EQUIPMENT | ||||||||||
As of December 31, | ||||||||||
(In thousands) | Estimated Useful Lives | 2013 | 2012 | |||||||
Land | $ | 2,200 | $ | 2,396 | ||||||
Buildings and leasehold improvements | 5 - 39 years | 6,225 | 7,554 | |||||||
Furniture, fixtures and equipment | 3 - 7 years | 7,006 | 6,667 | |||||||
15,431 | 16,617 | |||||||||
Less accumulated depreciation and amortization | (10,956 | ) | (11,385 | ) | ||||||
Premises and equipment, net | $ | 4,475 | $ | 5,232 | ||||||
Depreciation and amortization expense related to premises and equipment was approximately $451,000 and $417,000, for the years ended 2013 and 2012, respectively. During 2013, pursuant to the real estate rationalization plan under PIP, the Company sold four Company owned properties with a carrying value of $674,000 and recorded $2.5 million in gains on the sales. See “Note 2 – Regulatory Matters and Significant Risks and Uncertainties” to the Consolidated Financial Statements for additional information on PIP. |
LEASE_COMMITMENTS
LEASE COMMITMENTS | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
LEASE COMMITMENTS [Abstract] | ' | ||||
LEASE COMMITMENTS | ' | ||||
NOTE 8 - LEASE COMMITMENTS | |||||
The Company leases various premises under operating lease agreements, which expire through 2024 and require minimum annual rentals. Some of these leases are cancelable. The approximate minimum rental commitments under the leases are as follows for the year ended December 31, 2013: | |||||
As of | |||||
(In thousands) | 31-Dec-13 | ||||
2014 | $ | 858 | |||
2015 | 874 | ||||
2016 | 886 | ||||
2017 | 860 | ||||
2018 | 818 | ||||
Thereafter | 2,070 | ||||
Total lease commitments | $ | 6,366 | |||
The leases contain options to extend for periods from one to ten years. The cost of such lease extensions is not included in the above table. Rental expense for all leases was approximately $785,000 and $795,000 for the years ended December 31, 2013 and 2012, respectively. Lease expense will increase in 2014 due to the relocations of two retail offices from Company owned real estate to leased real estate. | |||||
DEPOSITS
DEPOSITS | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
DEPOSITS [Abstract] | ' | ||||||||
DEPOSITS | ' | ||||||||
NOTE 9 – DEPOSITS | |||||||||
Deposits are summarized as follows: | |||||||||
As of December 31, | |||||||||
(In thousands) | 2013 | 2012 | |||||||
Demand | $ | 60,473 | $ | 58,531 | |||||
NOW | 45,375 | 43,920 | |||||||
Money Market | 164,678 | 179,359 | |||||||
Savings | 17,593 | 17,472 | |||||||
Time deposits (over $100) | 92,763 | 91,233 | |||||||
Time deposits (under $100) | 148,082 | 164,402 | |||||||
Total deposits | $ | 528,964 | $ | 554,917 | |||||
Maturities of time deposits for the next five years and thereafter are as follows: | |||||||||
As of | |||||||||
(In thousands) | 31-Dec-13 | ||||||||
2014 | $ | 117,181 | |||||||
2015 | 88,948 | ||||||||
2016 | 11,997 | ||||||||
2017 | 5,373 | ||||||||
2018 | 3,204 | ||||||||
Thereafter | 14,142 | ||||||||
Total certificates of deposit | $ | 240,845 |
BORROWINGS_AND_SUBORDINATED_DE
BORROWINGS AND SUBORDINATED DEBENTURES | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
BORROWINGS AND SUBORDINATED DEBENTURES [Abstract] | ' | ||||||||||||||||
BORROWINGS AND SUBORDINATED DEBENTURES | ' | ||||||||||||||||
NOTE 10 – BORROWINGS AND SUBORDINATED DEBENTURES | |||||||||||||||||
1. Advances from the Federal Home Loan Bank | |||||||||||||||||
While Royal Bank has a $150 million line of credit with the FHLB, the available borrowing capacity with the FHLB is based on qualified collateral. During the third quarter, the FHLB released Royal Bank from the over collateralized delivery requirement of 105% subject to reevaluation on a quarterly basis. Additionally during the fourth quarter of 2013 the FHLB released Royal Bank from loan-level listing status. As of December 31, 2013, Royal Bank had approximately $190.0 million of available borrowing capacity at the FHLB as a result of the two collateral restrictions being removed. Total advances from the FHLB were $65.0 million at December 31, 2013 and 2012. The FHLB advances had a weighted average interest rate of 1.19%. The advances and the line of credit are collateralized by FHLB stock, government agencies and mortgage-backed securities. As of December 31, 2013, investment securities with a market value of $70.4 million were pledged as collateral to the FHLB. The average balance of advances with the FHLB during 2013 was $64.4 million. | |||||||||||||||||
At December 31, 2012, advances from FHLB totaled $65.0 million with maturities within five years. These advances had a weighted average interest rate of 2.35%. The average balance of advances with the FHLB during 2012 was $80.1 million. | |||||||||||||||||
Presented below are the Company’s FHLB borrowings allocated by the year in which they mature with their corresponding weighted average rates: | |||||||||||||||||
As of December 31, | |||||||||||||||||
(Dollars in thousands) | 2013 | 2012 | |||||||||||||||
Amount | Rate | Amount | Rate | ||||||||||||||
Advances maturing in | |||||||||||||||||
2013 | $ | - | - | $ | 50,000 | 2.64 | % | ||||||||||
2014 | 10,000 | 0.24 | % | ||||||||||||||
2015 | 10,000 | 0.71 | % | - | - | ||||||||||||
2016 | 10,000 | 1.11 | % | - | - | ||||||||||||
2017 | 25,000 | 1.46 | % | 15,000 | 1.39 | % | |||||||||||
2018 | 10,000 | 2.01 | % | ||||||||||||||
Total FHLB borrowings | $ | 65,000 | $ | 65,000 | |||||||||||||
2. Other borrowings | |||||||||||||||||
The Company has a note payable with PNC Bank (“PNC”) at December 31, 2013 in the amount of $2.9 million with a maturity date of August 25, 2016. The note payable balance at December 31, 2012 was $3.3 million. The interest rate is a variable rate using rate index of one month LIBOR + 15 basis points and adjusts monthly. The interest rate at December 31, 2013 and 2012 was 0.32% and 0.36%, respectively. | |||||||||||||||||
At December 31, 2013 and 2012, the Company had other borrowings of $40.0 million from PNC which will mature on January 7, 2018. These borrowings are secured by government agencies and mortgaged-backed securities. These borrowings have a weighted average interest rate of 3.65%. As of December 31, 2013, investment securities with a market value of $49.7 million were pledged as collateral to secure all borrowings with PNC. | |||||||||||||||||
3. Subordinated debentures | |||||||||||||||||
The Company has outstanding $25.0 million of Trust Preferred Securities issued through two Delaware trust affiliates, Royal Bancshares Capital Trust I (“Trust I”) and Royal Bancshares Capital Trust II (“Trust II”) (collectively, the “Trusts”). The Company issued an aggregate principal amount of $12.9 million of floating rate junior subordinated debt securities to Trust I and an aggregate principal amount of $12.9 million of fixed/floating rate junior subordinated deferrable interest to Trust II. Both debt securities bear an interest rate of 2.39% at December 31, 2013, and reset quarterly at 3-month LIBOR plus 2.15%. | |||||||||||||||||
Each of Trust I and Trust II issued an aggregate principal amount of $12.5 million of capital securities initially bearing fixed and/or fixed/floating interest rates corresponding to the debt securities held by each trust to an unaffiliated investment vehicle and an aggregate principal amount of $387,000 of common securities bearing fixed and/or fixed/floating interest rates corresponding to the debt securities held by each trust to the Company. The Company has fully and unconditionally guaranteed all of the obligations of the Trusts, including any distributions and payments on liquidation or redemption of the capital securities. | |||||||||||||||||
On August 13, 2009, the Company’s Board suspended the interest payments on the trust preferred securities. Under the Federal Reserve MOU as described in “Note 2 – Regulatory Matters and Significant Risks or Uncertainties” to the Consolidated Financial Statements, the Company and its non-bank subsidiaries may not make any distributions of interest, principal, or other sums on subordinated debentures or trust preferred securities without the prior written approval of the Reserve Bank and the Director of the Division of Banking Supervision and Regulation of the Board of Governors of the Federal Reserve System. During the third quarter of 2013, the Company received approval from the Federal Reserve Bank to pay the $3.1 million interest payment in arrears on the trust preferred securities. On September 16, 2013, the Company became current on the trust preferred interest payments which included an interest penalty of $174,000. The Company received approval and paid the fourth quarter interest payment in December 2013. |
INCOME_TAXES
INCOME TAXES | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
INCOME TAXES [Abstract] | ' | ||||||||
INCOME TAXES | ' | ||||||||
NOTE 11 - INCOME TAXES | |||||||||
The components of income tax expense are stated below: | |||||||||
For the years ended December 31, | |||||||||
(In thousands) | 2013 | 2012 | |||||||
Income tax expense | |||||||||
Current | $ | 42 | $ | - | |||||
Deferred | - | - | |||||||
Income tax expense | $ | 42 | $ | - | |||||
The difference between the applicable income tax expense and the amount computed by applying the statutory federal income tax rate of 34% in 2013 and 2012 is as follows: | |||||||||
For the years ended December 31, | |||||||||
(In thousands) | 2013 | 2012 | |||||||
Computed tax expense (benefit) at statutory rate | $ | 731 | $ | (5,313 | ) | ||||
Tax-exempt income | (22 | ) | (42 | ) | |||||
Department of Justice fine | - | 680 | |||||||
Nondeductible expense | 21 | 29 | |||||||
Bank owned life insurance | (183 | ) | (188 | ) | |||||
Adjustment to prior year items | 1,933 | - | |||||||
(Decrease) increase in valuation allowance | (2,438 | ) | 4,834 | ||||||
Applicable income tax expense | $ | 42 | $ | - | |||||
Deferred tax assets and liabilities consist of the following: | |||||||||
As of December 31, | |||||||||
(In thousands) | 2013 | 2012 | |||||||
Deferred tax assets | |||||||||
Allowance for loan and lease losses | $ | 4,648 | $ | 5,863 | |||||
Net operating loss carry forward | 18,908 | 21,988 | |||||||
Asset valuation reserves | 34 | 79 | |||||||
Escrow settlement reserves | 561 | - | |||||||
Security writedowns | 2,193 | 1,429 | |||||||
OREO writedowns | 1,490 | 4,475 | |||||||
Investment in partnerships | 1,805 | 34 | |||||||
Pension obligations | 4,926 | 5,745 | |||||||
Unrealized losses on debt securities | 2,171 | - | |||||||
Accrued stock-based compensation | 143 | 804 | |||||||
Non-accrual interest | 134 | 277 | |||||||
Capital loss carryovers | 2,892 | 1,550 | |||||||
Charitable contribution carryovers | 14 | 11 | |||||||
Other | 77 | 139 | |||||||
Deferred tax assets before valuation allowance | 39,996 | 42,394 | |||||||
Less valuation allowance | (37,159 | ) | (39,597 | ) | |||||
Total deferred tax assets | 2,837 | 2,797 | |||||||
Deferred tax liabilities | |||||||||
Penalties on delinquent tax certificates | 39 | 224 | |||||||
Unrealized gains on AFS debt investment securities | - | 1,665 | |||||||
Unrealized gains on AFS equity securities | 429 | 145 | |||||||
Prepaid deductions | 190 | 285 | |||||||
Other | 8 | 64 | |||||||
Total deferred tax liabilities | 666 | 2,383 | |||||||
Net deferred tax assets, included in other assets | $ | 2,171 | $ | 414 | |||||
As of December 31, 2013 the Company had net operating income tax loss carryforwards of approximately $51.6 million which are available to be carried forward to future tax years. These loss carryforwards will expire in varying amounts beginning in 2030 and ending in 2033 if not utilized. | |||||||||
The Company has approximately $4.0 million available to be utilized as of December 31, 2013 related to net operating loss carryovers from the acquisition of Knoblauch State Bank. The ability to utilize these carryovers will expire in 2015. The utilization of these losses is subject to limitation under Section 382 of the Internal Revenue Code. | |||||||||
As of December 31, 2013, the Company has capital loss carryforwards of approximately $8.5 million which will begin to expire as of December 31, 2014 if not utilized. The company also has charitable contribution carryovers of $42,000 that will begin to expire as of December 31, 2014 if not utilized. The company also has general business tax credit carryovers of $1,000 that will begin to expire as of December 31, 2030 if not utilized. | |||||||||
The Company recognizes deferred tax assets and liabilities for the future tax consequences related to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and for tax credits. The deferred tax assets, net of valuation allowances, totaled $2.2 million and $414,000 at December 31, 2013 and 2012, respectively. Management evaluated the deferred tax assets for recoverability using a consistent approach which considers the relative impact of negative and positive evidence, including historical profitability and projections of future reversals of temporary differences and future taxable income. The Company is required to establish a valuation allowance for deferred tax assets and record a charge to income or shareholders' equity if management determines, based on available evidence at the time the determination is made, that it is more likely than not that some portion or all of the deferred tax assets will not be realized. In evaluating the need for a valuation allowance, the Company estimates future taxable income based on management approved business plans and ongoing tax planning strategies. This process involves significant management judgment about assumptions that are subject to change from period to period based on changes in tax laws or variances between projected operating performance, actual results and other factors. The Company did not establish a valuation allowance for the deferred tax asset amount of $2.2 million as of December 31, 2013. The $2.2 million net deferred tax asset as of December 31, 2013 relates to the portion attributable to unrealized losses on AFS debt securities recorded through accumulated other comprehensive loss since they do not require a source of future taxable income for realization. Management believes this deferred tax related to AFS debt securities is recoverable because the Company has the intent and ability to hold these securities until recovery of the amortized cost basis or the increase in value up to its amortized cost over the life. Management believes that these unrealized losses will reverse over time. | |||||||||
As of December 31, 2013, the Company was in a cumulative book loss position for the three-year period ended December 31, 2013. For purposes of establishing a deferred tax asset valuation allowance, this cumulative book loss position is considered significant objective evidence that the Company may not be able to realize some portion of the deferred tax assets in the future. The cumulative book loss position was caused by the negative impact on results from the banking operations, investment impairments and loan and lease losses over the past three years. | |||||||||
As of December 31, 2013, and 2012, management concluded that it was more likely than not that the Company would not generate sufficient future taxable income to realize all of the deferred tax assets. Management’s conclusion was based on consideration of the relative weight of the available evidence and the uncertainty of future market conditions on results of operations. As a result, the Company has recorded a cumulative non-cash charge of $37.2 million in the consolidated statements of operations that began in the period ended December 31, 2008 related to the establishment of a valuation allowance for the deferred tax asset for the portion of the future tax benefit that more likely than not will not be utilized in the future. | |||||||||
The Company is subject to income taxes in the U. S. and various state and local jurisdictions. As of December 31, 2013, tax years 2006 through 2007 and 2009 through 2013 are subject to examination by various taxing authorities. Tax regulations are subject to interpretation of the related tax laws and regulations and require significant judgment to apply. | |||||||||
The Company adopted new authoritative accounting guidance issued under FASB ASC Topic 740-10, “Accounting for Uncertainty in Income Taxes” as of January 1, 2007, and had no material unrecognized tax benefits (UTB) or accrued interest and penalties as of December 31, 2013. We do not expect the total amount of unrecognized tax benefits to significantly increase in the next twelve months. We classify interest and penalties as an element of tax expense. We monitor changes in tax statutes and regulations to determine if significant changes will occur over the next 12 months. As of December 31, 2013 no significant changes to UTB are projected, however, tax audit examinations are possible. | |||||||||
FINANCIAL_INSTRUMENTS_WITH_OFF
FINANCIAL INSTRUMENTS WITH OFF-BALANCE-SHEET RISK AND CONCENTRATIONS OF CREDIT RISK | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
FINANCIAL INSTRUMENTS WITH OFF-BALANCE-SHEET RISK AND CONCENTRATIONS OF CREDIT RISK [Abstract] | ' | ||||||||
FINANCIAL INSTRUMENTS WITH OFF-BALANCE-SHEET RISK AND CONCENTRATIONS OF CREDIT RISK | ' | ||||||||
NOTE 12 - FINANCIAL INSTRUMENTS WITH OFF-BALANCE-SHEET RISK AND CONCENTRATIONS OF CREDIT RISK | |||||||||
The Company is a party to financial instruments with off-balance-sheet risk in the normal course of business to meet the financing needs of its customers and to reduce its own exposure to fluctuations in interest rates. These financial instruments include commitments to extend credit and standby letters of credit. Such financial instruments are recorded in the financial statements when they become payable. 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 contract 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 non-performance by the other party to commitments to extend credit and standby letters of credit 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. | |||||||||
The contract amounts are as follows: | |||||||||
As of December 31, | |||||||||
(In thousands) | 2013 | 2012 | |||||||
Financial instruments whose contract amounts represent credit risk | |||||||||
Open-end lines of credit | $ | 21,182 | $ | 20,515 | |||||
Commitments to extend credit | 200 | 24,030 | |||||||
Standby letters of credit and financial guarantees written | 2,679 | 1,199 | |||||||
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, and others are for staged construction, the total commitment amounts do not necessarily represent immediate cash requirements. | |||||||||
The Company evaluates each customer’s creditworthiness 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. Collateral held varies but may include personal or commercial real estate, accounts receivable, inventory or equipment. | |||||||||
Standby letters of credit 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, including commercial paper, bond financing and similar transactions. Most guarantees extend for one year and expire in decreasing amounts through August 2016. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. The Company holds personal or commercial real estate, accounts receivable, inventory or equipment as collateral supporting those commitments for which collateral is deemed necessary. The extent of collateral held for those commitments is approximately 75%. | |||||||||
LEGAL_CONTINGENCIES
LEGAL CONTINGENCIES | 12 Months Ended |
Dec. 31, 2013 | |
LEGAL CONTINGENCIES [Abstract] | ' |
LEGAL CONTINGENCIES | ' |
NOTE 13 – LEGAL CONTINGENCIES | |
Royal Bank had a 60% equity interest in each of CSC and RTL. CSC and RTL acquired, through public auction, delinquent tax liens in various jurisdictions thereby assuming a superior lien position to most other lien holders, including mortgage lien holders. On March 4, 2009, each of CSC and RTL received grand jury subpoenas issued by the U.S. District Court for New Jersey (“Court”) upon application of the Antitrust Division of the United States DOJ. On February 23, 2012, the former President of CSC and RTL entered a plea of guilty to one count of conspiring to rig bids at certain auctions for tax liens in New Jersey from 1998 until approximately the spring of 2009. On September 26, 2012, as a result of the former President’s guilty plea and pursuant to a plea agreement with the DOJ, CSC entered a guilty plea in the United States District Court for the District of New Jersey to one count of conspiracy to commit bid-rigging at certain auctions for tax liens in New Jersey. Under the terms of the Court accepted plea agreement, the DOJ agreed not to bring further criminal charges against CSC and not to bring criminal charges against RTL, or any current or former director, officer, or employee of CSC and/or RTL, for any act or offense committed prior to the date of the plea agreement that was in furtherance of any agreement to rig bids at municipal tax lien sales or auctions in the State of New Jersey. The former President of CSC and RTL and any person who bid at any time at a tax lien auction on behalf of CSC and/or RTL are excluded from this non-prosecution protection. At the sentencing hearing held in December 2012, the sentencing judge agreed with the DOJ’s recommendation and imposed a $2.0 million fine for CSC. After adjusting for the noncontrolling interest, the Company’s 60% share of the fine amounted to $1.2 million. | |
In 2012, the former President of CSC and RTL, CSC, RTL and the Company were named defendants, among others, in putative class action lawsuits filed in the U.S. District Court for the District of New Jersey (“Court”) on behalf of a proposed class of taxpayers who became delinquent in paying their municipal tax obligations which alleged a conspiracy to rig bids in municipal tax lien auctions. On June 12, 2012, the Court entered an Order consolidating for pretrial purposes the actions with all subsequently filed or transferred related actions, collectively referred to as In re New Jersey Tax Sale Certificates Antitrust Litigation. On October 22, 2012, the Court appointed two law firms as interim class counsel and another law firm as liaison class counsel and further ordered appointed counsel to a master complaint for the consolidated action. On December 21, 2012, plaintiffs filed a Consolidated Master Class Action Complaint (the “Complaint”) against numerous defendants, including the former President of CSC and RTL, Royal Bancshares of Pennsylvania, Inc., Royal Bank America, CSC and RTL. The Company filed a motion to dismiss the Complaint on March 8, 2013, which is currently pending before the Court. | |
During the second quarter of 2013, the Company accrued a loss contingency of $1.65 million for a potential settlement with the plaintiffs. After adjusting for the noncontrolling interest, the Company’s 60% share of the loss contingency amounted to $990,000 on a pre-tax basis. Subsequently, the Company, Royal Bank, CSC, and RTL reached a settlement agreement with plaintiffs to settle the litigation for $1.65 million and other terms and conditions, including an opportunity for members of the proposed settlement class whose tax liens are currently held by CSC or RTL to redeem those liens for a one-time cash payment equaling 85% of the redemption amount by making such payment within 35 days of the date of written notice. The proposed settlement class does not include, and therefore the offer to redeem does not apply to, tax liens acquired at 0% interest or at a premium. The settlement is subject to Court approval after notice and a hearing. Members of the proposed settlement class will have an opportunity to object to the proposed settlement or opt-out. | |
On or about March 15, 2012, CSC, RTL and the Company were named defendants, among others, in a complaint filed by Marina Bay Towers Urban Renewal II, LP (“MBT”) in the Superior Court of New Jersey, Law Division, Cape May County. The complaint alleges essentially the same claims as asserted in the Complaint. However MBT does not seek to represent a class and only seeks remedies related to itself. As of the date of this filing, the Company cannot reasonably estimate the possible loss or range of loss that may result from this proceeding. | |
In 2005, the Company purchased $25.0 million in Class B-1 Notes of a collateralized debt obligation (“CDO”) offered by Lehman Brothers, Inc. Concurrently with the issuance of the notes, the issuer entered into a credit swap with Lehman Brothers Special Financing (“LBSF”). Lehman Brothers Holdings, Inc. (“LBHI”) guaranteed LBSF’s obligations to the issuer under the credit swap. When LBHI filed for bankruptcy in September 2008, an event of default under the indenture occurred, and the trustee declared the notes to be immediately due and payable. The Company was repaid its principal on the notes in September 2008. In September 2010, LBSF filed suit in the United States Bankruptcy court for the Southern District of New York against certain indenture trustees, certain special-purpose entities (issuers) and a class of noteholders and trust certificate holders who received distributions from the trustees, to recover funds that were allegedly improperly paid to the noteholders in forty-seven separate CDO transactions. In July 2012, LBSF added the Company as a defendant in the proceeding. In June 2013, LBSF voluntarily dismissed without prejudice and without costs all claims against the Company related to the CDO transaction. |
SHAREHOLDERS_EQUITY
SHAREHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2013 | |
SHAREHOLDERS' EQUITY [Abstract] | ' |
SHAREHOLDERS' EQUITY | ' |
NOTE 14 – SHAREHOLDERS’ EQUITY | |
1. Preferred Stock | |
On February 20, 2009, as part of the Capital Purchase Program (“CPP”) established by the United States Department of Treasury (“Treasury”), the Company issued to Treasury 30,407 shares of the Company’s Fixed Rate Cumulative Perpetual Preferred Stock, Series A, without par value per share (the “Series A Preferred Stock”), and a liquidation preference of $1,000 per share. In conjunction with the purchase of the Series A Preferred Stock, Treasury received a warrant to purchase 1,104,370 shares of the Company’s Class A common stock. The aggregate purchase price for the Series A Preferred Stock and warrant was $30.4 million in cash. The Series A Preferred Stock qualifies as Tier 1 capital and pays cumulative dividends at a rate of 5% per annum for the first five years, and 9% per annum commencing in February 2014. The Series A Preferred Stock may generally be redeemed by the Company at any time following consultation with its primary banking regulators. The warrant issued to Treasury has a 10-year term and is immediately exercisable upon its issuance, with an exercise price, subject to anti-dilution adjustments, equal to $4.13 per share of the common stock. The Company’s utilized the extra capital provided by the CPP funds to support its efforts to prudently and transparently provide lending and liquidity while also balancing the goal to remain well-capitalized. | |
2. Common Stock | |
The Company’s Class A common stock trades on the NASDAQ Global Market under the symbol RBPAA. There is no market for the Company’s Class B common stock. The Class B shares may not be transferred in any manner except to the holder’s immediate family. Class B shares may be converted to Class A shares at the rate of 1.15 to 1. Class B common stock is entitled to one vote for each Class A share and ten votes for each Class B share held. Holders of either class of common stock are entitled to conversion equivalent per share dividends when declared. | |
3. Payment of Dividends | |
Under the Pennsylvania Business Corporation Law, the Company may pay dividends only if it is solvent and would not be rendered insolvent by the dividend payment. There are also restrictions set forth in the Pennsylvania Banking Code of 1965 (the “Code”) and in the Federal Deposit Insurance Act (“FDIA”) affecting the payment of dividends to the Company by Royal Bank. Under the Code, no dividends may be paid by a bank except from “accumulated net earnings” (generally retained earnings). In addition, dividends paid by Royal Bank to the Company would be prohibited if the effect thereof would cause Royal Bank’s capital to be reduced below applicable minimum capital requirements. At December 31, 2013, the Company had negative retained earnings and therefore would not have been able to declare and pay any cash dividends. Royal Bank must receive prior approval from the FDIC and the Department before declaring and paying a dividend to the Company. | |
On August 13, 2009, the Company’s Board suspended the regular quarterly cash dividends on the $30.4 million in Series A Preferred Stock. The Company’s Board took this action in consultation with the Federal Reserve Bank of Philadelphia as required by regulatory policy guidance. As of December 31, 2013, the Series A Preferred stock dividend in arrears was $7.7 million and has not been recognized in the consolidated financial statements. In the event the Company declared the preferred dividend the Company’s capital ratios would be negatively affected however they would remain above the required minimum ratios. Under the Federal Reserve MOU as described in “Note 2 – Regulatory Matters and Significant Risks or Uncertainties” to the Consolidated Financial Statements, the Company may not declare or pay any dividends without the prior written approval of the Reserve Bank and the Director of the Division of Banking Supervision and Regulation of the Board of Governors of the Federal Reserve System. In February 2014, the preferred cumulative dividend rate prospectively increased to 9% per annum. | |
4. Change in Noncontrolling Interest | |
As mentioned in “Note 1 – Summary of Significant Accounting Policies” and “Note 13 - Legal Contingencies” to the Consolidated Financial Statements, Royal Bank had a 60% ownership interest in CSC and RTL. Effective December 31, 2013, Royal Bank agreed to a $1.25 million cash settlement with the former President of CSC and RTL, in which Royal Bank acquired his 40% ownership interest in RTL for $850,000. The former President also relinquished his 20% ownership interest in CSC to Royal Bank. The combined value of the ownership interests was $2.6 million. The settlement resulted in a $1.5 million gain for Royal Bank which was recorded as an increase to Additional Paid in Capital within Stockholders Equity. As part of the cash settlement Royal Bank agreed to pay $400,000 for prior tax distributions. Additionally, the settlement agreement also includes a possible tax payment upon completion of the 2013 Forms K-1. Effective, December 31, 2013, Royal Bank is an 80% owner of CSC and 100% owner of RTL. |
REGULATORY_CAPITAL_REQUIREMENT
REGULATORY CAPITAL REQUIREMENTS | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||
REGULATORY CAPITAL REQUIREMENTS [Abstract] | ' | ||||||||||||||||||||||||
REGULATORY CAPITAL REQUIREMENTS | ' | ||||||||||||||||||||||||
NOTE 15 – REGULATORY CAPITAL REQUIREMENTS | |||||||||||||||||||||||||
The Company and Royal Bank are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possible additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company must meet specific capital guidelines that involve quantitative measures of the Company’s assets, liabilities and certain off-balance-sheet items as calculated under regulatory accounting practices. The Company’s and Royal Bank’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors. Under the informal agreement referenced in “Note 2 – Regulatory Matters and Significant Risks And Uncertainties” to the Consolidated Financial Statements, Royal Bank is required to maintain a minimum Tier 1 leverage ratio of 8% and a Total risk-based capital ratio of 12%. As of December 31, 2013, the Company and Royal Bank met all capital adequacy requirements to which it is subject and Royal Bank met the criteria for a well-capitalized institution. | |||||||||||||||||||||||||
In connection with a prior bank regulatory examination, the FDIC concluded, based upon its interpretation of the Call Report instructions and under RAP, that income from Royal Bank’s tax lien business should be recognized on a cash basis, not an accrual basis. Royal Bank’s current accrual method is in accordance with U.S. GAAP. Royal Bank disagrees with the FDIC’s conclusion and filed the Call Report for December 31, 2013 and the previous 13 quarters in accordance with U.S. GAAP. However, a change in the manner of revenue recognition for the tax lien business for regulatory accounting purposes affects Royal Bank’s and the Company’s capital ratios as shown below. The resolution of this matter will be decided by additional joint regulatory agency guidance which includes the Federal Reserve Bank, the FDIC, and the OCC. | |||||||||||||||||||||||||
The table below sets forth Royal Bank’s capital ratios under RAP based on the FDIC’s interpretation of the Call Report instructions: | |||||||||||||||||||||||||
To be well capitalized | |||||||||||||||||||||||||
For capital | capitalized under prompt | ||||||||||||||||||||||||
Actual | adequacy purposes | corrective action provision | |||||||||||||||||||||||
(Dollars in thousands) | Amount | Ratio | Amount | Ratio | Amount | Ratio | |||||||||||||||||||
Total capital (to risk-weighted assets) | |||||||||||||||||||||||||
At December 31, 2013 | $ | 71,417 | 15.61 | % | $ | 36,590 | 8 | % | $ | 45,737 | 10 | % | |||||||||||||
At December 31, 2012 | $ | 67,338 | 15.22 | % | $ | 35,386 | 8 | % | $ | 44,233 | 10 | % | |||||||||||||
Tier I capital (to risk-weighted assets) | |||||||||||||||||||||||||
At December 31, 2013 | $ | 65,602 | 14.34 | % | $ | 18,295 | 4 | % | $ | 27,442 | 6 | % | |||||||||||||
At December 31, 2012 | $ | 61,664 | 13.94 | % | $ | 17,693 | 4 | % | $ | 26,540 | 6 | % | |||||||||||||
Tier I capital (to average assets, leverage) | |||||||||||||||||||||||||
At December 31, 2013 | $ | 65,602 | 9.13 | % | $ | 28,739 | 4 | % | $ | 35,924 | 5 | % | |||||||||||||
At December 31, 2012 | $ | 61,664 | 8 | % | $ | 30,842 | 4 | % | $ | 38,552 | 5 | % | |||||||||||||
The tables below reflect the adjustments to the net loss as well as the capital ratios for Royal Bank under U.S. GAAP: | |||||||||||||||||||||||||
For the years ended December 31, | |||||||||||||||||||||||||
(In thousands) | 2013 | 2012 | |||||||||||||||||||||||
RAP net loss | $ | (139 | ) | $ | (17,974 | ) | |||||||||||||||||||
Tax lien adjustment, net of noncontrolling interest | 2,844 | 4,731 | |||||||||||||||||||||||
U.S. GAAP net income (loss) | $ | 2,705 | $ | (13,243 | ) | ||||||||||||||||||||
At December 31, 2013 | At December 31, 2012 | ||||||||||||||||||||||||
As reported | As adjusted | As reported | As adjusted | ||||||||||||||||||||||
under RAP | for U.S. GAAP | under RAP | for U.S. GAAP | ||||||||||||||||||||||
Total capital (to risk-weighted assets) | 15.61 | % | 16.49 | % | 15.22 | % | 16.73 | % | |||||||||||||||||
Tier I capital (to risk-weighted assets) | 14.34 | % | 15.22 | % | 13.94 | % | 15.44 | % | |||||||||||||||||
Tier I capital (to average assets, leverage) | 9.13 | % | 9.73 | % | 8 | % | 8.93 | % | |||||||||||||||||
The tables below reflect the Company’s capital ratios: | |||||||||||||||||||||||||
To be well capitalized | |||||||||||||||||||||||||
For capital | capitalized under prompt | ||||||||||||||||||||||||
Actual | adequacy purposes | corrective action provision | |||||||||||||||||||||||
(Dollars in thousands) | Amount | Ratio | Amount | Ratio | Amount | Ratio | |||||||||||||||||||
Total capital (to risk-weighted assets) | |||||||||||||||||||||||||
At December 31, 2013 | $ | 84,384 | 18.09 | % | $ | 37,315 | 8 | % | N/A | N/A | |||||||||||||||
At December 31, 2012 | $ | 84,073 | 18.46 | % | $ | 36,429 | 8 | % | N/A | N/A | |||||||||||||||
Tier I capital (to risk-weighted assets) | |||||||||||||||||||||||||
At December 31, 2013 | $ | 71,432 | 15.31 | % | $ | 18,658 | 4 | % | N/A | N/A | |||||||||||||||
At December 31, 2012 | $ | 71,138 | 15.62 | % | $ | 18,214 | 4 | % | N/A | N/A | |||||||||||||||
Tier I Capital (to average assets, leverage) | |||||||||||||||||||||||||
At December 31, 2013 | $ | 71,432 | 9.79 | % | $ | 29,178 | 4 | % | N/A | N/A | |||||||||||||||
At December 31, 2012 | $ | 71,138 | 9.05 | % | $ | 31,443 | 4 | % | N/A | N/A | |||||||||||||||
The Company has filed the Consolidated Financial Statements for Bank Holding Companies-FR Y-9C (“FR Y-9C”) as of December 31, 2013 consistent with U.S. GAAP and the FR Y-9C instructions. In the event a similar adjustment for RAP purposes would be required by the Federal Reserve on the holding company level, the adjusted ratios are shown in the tables below. | |||||||||||||||||||||||||
For the years ended December 31, | |||||||||||||||||||||||||
(In thousands) | 2013 | 2012 | |||||||||||||||||||||||
U.S. GAAP net income (loss) | $ | 2,109 | $ | (15,625 | ) | ||||||||||||||||||||
Tax lien adjustment, net of noncontrolling interest | (2,844 | ) | (4,731 | ) | |||||||||||||||||||||
RAP net loss | $ | (735 | ) | $ | (20,356 | ) | |||||||||||||||||||
At December 31, 2013 | At December 31, 2012 | ||||||||||||||||||||||||
As reported | As adjusted | As reported | As adjusted | ||||||||||||||||||||||
under U.S. GAAP | for RAP | under U.S. GAAP | for RAP | ||||||||||||||||||||||
Total capital (to risk-weighted assets) | 18.09 | % | 17.24 | % | 18.46 | % | 17.01 | % | |||||||||||||||||
Tier I capital (to risk-weighted assets) | 15.31 | % | 14.1 | % | 15.62 | % | 13.55 | % | |||||||||||||||||
Tier I capital (to average assets, leverage) | 9.79 | % | 8.98 | % | 9.05 | % | 7.79 | % | |||||||||||||||||
PENSION_PLANS
PENSION PLANS | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
PENSION PLANS [Abstract] | ' | ||||||||
PENSION PLANS | ' | ||||||||
NOTE 16 - PENSION PLANS | |||||||||
The Company has a noncontributory nonqualified defined benefit pension plan covering certain eligible employees. The Company-sponsored pension plan provides retirement benefits under pension trust agreements. The benefits are based on years of service and the employee’s compensation during the highest three consecutive years during the last 10 years of employment. The Company accounts for its pension in accordance with FASB ASC Topic 715 “Compensation-Retirement Benefits” (“ASC Topic 715”). ASC Topic 715 requires the recognition of a plan’s over-funded or under-funded status as an asset or liability with an offsetting adjustment to AOCI. ASC Topic 715 requires the determination of the fair values of plans assets at a company’s year-end and recognition of actuarial gains and losses, prior service costs or credits, and transition assets or obligations as a component of AOCI. These amounts will be subsequently recognized as components of net periodic benefits cost. Further, actuarial gains and losses that arise in subsequent periods that are not initially recognized as a component of net periodic benefit cost will be recognized as a component of AOCI. Those amounts will subsequently be recognized as a component of net periodic benefit cost as they are amortized during future periods. | |||||||||
The following table sets forth the plan’s funded status and amounts recognized in the Company’s consolidated balance sheets: | |||||||||
For the years ended December 31, | |||||||||
(In thousands) | 2013 | 2012 | |||||||
Change in benefit obligation | |||||||||
Benefit obligation at beginning of year | $ | 16,897 | $ | 14,942 | |||||
Service cost | 81 | 272 | |||||||
Interest cost | 623 | 584 | |||||||
Benefits paid | (981 | ) | (556 | ) | |||||
Actuarial (gain) loss | (2,132 | ) | 1,655 | ||||||
Benefits obligation at end of year | $ | 14,488 | $ | 16,897 | |||||
Unrecognized prior service cost | 179 | 269 | |||||||
Unrecognized actuarial loss | 2,750 | 5,119 | |||||||
$ | 2,929 | $ | 5,388 | ||||||
The accumulated benefit obligation at December 31, 2013 and 2012 was $14.5 million and $16.6 million, respectively. | |||||||||
The table below reflects the assumptions used to determine the benefit obligations: | |||||||||
As of December 31, | |||||||||
2013 | 2012 | ||||||||
Discount rate | 4.37 | % | 3.25 | % | |||||
Rate of compensation increase | 4 | % | 4 | % | |||||
The table below reflects the assumptions used to determine the net periodic pension cost: | |||||||||
For the years ended December 31, | |||||||||
2013 | 2012 | ||||||||
Discount rate | 4.37 | % | 4 | % | |||||
Rate of compensation increase | 4 | % | 4 | % | |||||
Net pension cost included the following components: | |||||||||
For the years ended December 31, | |||||||||
(In thousands) | 2013 | 2012 | |||||||
Service cost | $ | 81 | $ | 272 | |||||
Interest cost | 623 | 584 | |||||||
Amortization prior service cost | 90 | 90 | |||||||
Amortization net actuarial loss | 238 | 381 | |||||||
Net periodic benefit cost | $ | 1,032 | $ | 1,327 | |||||
Benefit payments to be made from the Non-qualified Pension Plan are as follows: | |||||||||
As of December 31, 2013 | |||||||||
Non-Qualified | |||||||||
(In thousands) | Pension Plans | ||||||||
2014 | $ | 970 | |||||||
2015 | 987 | ||||||||
2016 | 1,015 | ||||||||
2017 | 1,015 | ||||||||
2018 | 1,015 | ||||||||
Next five years thereafter | 5,610 | ||||||||
Benefit payments are expected to be made from insurance policies owned by the Company. The cash surrender value for these policies was approximately $3.4 million and $3.3 million as of December 31, 2013 and 2012, respectively. | |||||||||
Defined Contribution Plan | |||||||||
The Company has a capital accumulation and salary reduction plan under Section 401(k) of the Internal Revenue Code of 1986, as amended. Under the plan, all employees are eligible to contribute up to the maximum allowed by IRS regulation, with the Company matching dollar for dollar of any contribution up to 5%, which is subject to a $2,500 per employee annual limit. During 2013 and 2012, no matching contribution was made as a result of a management decision to reduce costs. | |||||||||
STOCK_COMPENSATION_PLANS
STOCK COMPENSATION PLANS | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||
STOCK COMPENSATION PLANS [Abstract] | ' | ||||||||||||||||||||||||
STOCK COMPENSATION PLANS | ' | ||||||||||||||||||||||||
NOTE 17 - STOCK COMPENSATION PLANS | |||||||||||||||||||||||||
The Company recognized compensation expense for stock options in the amounts of $22,000 and $42,000 for December 31, 2013 and 2012, respectively. The Company granted 15,000 options to purchase common stock in 2013. The Company did not grant any options to purchase common stock in 2012. | |||||||||||||||||||||||||
1. Outside Directors’ Stock Option Plan | |||||||||||||||||||||||||
The Company had a non-qualified outside Directors’ Stock Option Plan (the “Directors’ Plan”) which expired in 2006. At December 31, 2013 all outstanding shares are fully vested (exercisable). The ability to grant new options under this plan has expired. | |||||||||||||||||||||||||
A summary of the Directors’ Plan activity is presented below: | |||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||
Weighted | Weighted | -1 | Weighted | ||||||||||||||||||||||
Average | Average | Average | Average | ||||||||||||||||||||||
Exercise | Remaining | Intrinsic | Exercise | ||||||||||||||||||||||
Options | Price | Term (yrs) | Value | Options | Price | ||||||||||||||||||||
Options outstanding at beginning of year | 58,306 | $ | 21.15 | 1.2 | 68,620 | $ | 20.66 | ||||||||||||||||||
Exercised | - | - | - | - | |||||||||||||||||||||
Forfeited | (24,286 | ) | 21.24 | - | - | ||||||||||||||||||||
Expired | (8,350 | ) | 18.27 | (10,314 | ) | 17.91 | |||||||||||||||||||
Options outstanding at the end of the year | 25,670 | $ | 22 | 1.5 | $ | - | 58,306 | $ | 21.15 | ||||||||||||||||
Options exercisable at the end of the year | 25,670 | $ | 22 | 1.5 | $ | - | 58,306 | $ | 21.15 | ||||||||||||||||
(1) The aggregate intrinsic value of a stock option in the table above represents the total pre-tax intrinsic value (the amount by which the current market value of the underlying stock exceeds the exercise price of the option) that would have been received by the option holders had they exercised their options on December 31, 2013. The intrinsic value varies based on the changes in the market value in the Company’s stock. Because the exercise price exceeded the market value of the options, the average intrinsic value was $0 at December 31, 2013. | |||||||||||||||||||||||||
Information pertaining to options outstanding at December 31, 2013 is as follows: | |||||||||||||||||||||||||
Options outstanding and exercisable | |||||||||||||||||||||||||
Weighted | Weighted | ||||||||||||||||||||||||
Average | Average | ||||||||||||||||||||||||
Range of | Number | Exercise | Remaining | ||||||||||||||||||||||
exercise prices | Outstanding | Price | Term (yrs) | ||||||||||||||||||||||
$21.00 - $23.00 | 25,670 | $ | 22 | 1.5 | |||||||||||||||||||||
25,670 | $ | 22 | 1.5 | ||||||||||||||||||||||
2. Employee Stock Option and Appreciation Right Plan | |||||||||||||||||||||||||
The Company had a Stock Option and Appreciation Right Plan (the “Plan”) which expired in 2006. At December 31, 2013 all outstanding shares are fully vested (exercisable). The ability to grant new options under this plan has expired. | |||||||||||||||||||||||||
A summary of the Plan activity is presented below: | |||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||
Weighted | Weighted | -1 | Weighted | ||||||||||||||||||||||
Average | Average | Average | Average | ||||||||||||||||||||||
Exercise | Remaining | Intrinsic | Exercise | ||||||||||||||||||||||
Options | Price | Term (yrs) | Value | Options | Price | ||||||||||||||||||||
Options outstanding at beginning of year | 217,561 | $ | 21.5 | 1.3 | 335,919 | $ | 21.01 | ||||||||||||||||||
Exercised | - | - | - | - | |||||||||||||||||||||
Forfeited | (119,137 | ) | 21.53 | (74,569 | ) | 21.42 | |||||||||||||||||||
Expired | (15,644 | ) | 18.27 | (43,789 | ) | 17.91 | |||||||||||||||||||
Options outstanding at the end of the year | 82,780 | $ | 22.06 | 1.1 | $ | - | 217,561 | $ | 21.5 | ||||||||||||||||
Options exercisable at the end of the year | 82,780 | $ | 22.06 | 1.1 | $ | - | 217,561 | $ | 21.5 | ||||||||||||||||
(1) The aggregate intrinsic value of a stock option in the table above represents the total pre-tax intrinsic value (the amount by which the current market value of the underlying stock exceeds the exercise price of the option) that would have been received by the option holders had they exercised their options on December 31, 2013. The intrinsic value varies based on the changes in the market value in the Company’s stock. Because the exercise price exceeded the market value of the options, the average intrinsic value was $0 at December 31, 2013. | |||||||||||||||||||||||||
Information pertaining to options outstanding at December 31, 2013 is as follows: | |||||||||||||||||||||||||
Options outstanding and exercisable | |||||||||||||||||||||||||
Weighted | Weighted | ||||||||||||||||||||||||
Average | Average | ||||||||||||||||||||||||
Range of | Number | Exercise | Remaining | ||||||||||||||||||||||
exercise prices | Outstanding | Price | Term (yrs) | ||||||||||||||||||||||
$21.00 - $23.00 | 82,780 | $ | 22.06 | 1.1 | |||||||||||||||||||||
82,780 | $ | 22.06 | 1.1 | ||||||||||||||||||||||
3. Long-Term Incentive Plan | |||||||||||||||||||||||||
The 2007 Long-Term Incentive Plan was approved by Shareholders at the May 16, 2007 Annual Meeting. The plan consists of both a restricted and an unrestricted stock option plan. All employees and non-employee directors of the Company and its designated subsidiaries are eligible participants. The plan includes one million shares of Class A common stock, subject to customary anti-dilution adjustments, or approximately 9.0% of the total outstanding shares of the Class A common stock. | |||||||||||||||||||||||||
As of December 31, 2012, 187,390 shares from the unrestricted plan have been granted. The option price is equal to the fair market value at the date of the grant. The employee options are exercisable based on the grant’s vesting schedule beginning one year after the date of grant and must be exercised within ten years of the grant date. Directors’ options are exercisable on the one year anniversary of the date of grant and must be exercised within ten years of the grant date. | |||||||||||||||||||||||||
A summary of the status of the unrestricted portion of the Plan is presented below: | |||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||
Weighted | Weighted | -1 | Weighted | ||||||||||||||||||||||
Average | Average | Average | Average | ||||||||||||||||||||||
Exercise | Remaining | Intrinsic | Exercise | ||||||||||||||||||||||
Options | Price | Term (yrs) | Value | Options | Price | ||||||||||||||||||||
Options outstanding at beginning of year | 86,226 | $ | 9.22 | 5.4 | 116,440 | $ | 9.73 | ||||||||||||||||||
Granted | 15,000 | 1.36 | - | - | |||||||||||||||||||||
Exercised | - | - | - | - | |||||||||||||||||||||
Forfeited | (11,840 | ) | 8.83 | (30,214 | ) | 11.19 | |||||||||||||||||||
Expired | - | - | - | - | |||||||||||||||||||||
Options outstanding at the end of the year | 89,386 | $ | 7.95 | 4.9 | $ | - | 86,226 | $ | 9.22 | ||||||||||||||||
Options exercisable at the end of the year | 74,386 | $ | 9.28 | 4 | $ | - | 75,706 | $ | 9.88 | ||||||||||||||||
Weighted-average fair value of options granted during the year | $ | 0.98 | $ | - | $ | - | |||||||||||||||||||
(1) The aggregate intrinsic value of a stock option in the table above represents the total pre-tax intrinsic value (the amount by which the current market value of the underlying stock exceeds the exercise price of the option) that would have been received by the option holders had they exercised their options on December 31, 2013. The intrinsic value varies based on the changes in the market value in the Company’s stock. Because the exercise price exceeded the market value of the options, the average intrinsic value was $0 at December 31, 2013. | |||||||||||||||||||||||||
Information pertaining to options outstanding at December 31, 2013 is as follows: | |||||||||||||||||||||||||
Options issued and outstanding | Options exercisable | ||||||||||||||||||||||||
Weighted | Weighted | Weighted | |||||||||||||||||||||||
Average | Average | Average | |||||||||||||||||||||||
Range of | Number | Exercise | Remaining | Number | Exercise | ||||||||||||||||||||
exercise prices | Outstanding | Price | Term (yrs) | Outstanding | Price | ||||||||||||||||||||
$ | 1.36 | 15,000 | $ | 1.36 | 9.3 | - | $ | - | |||||||||||||||||
$ | 4.5 | 51,550 | 4.5 | 4.3 | 51,550 | 4.5 | |||||||||||||||||||
$ | 20.08 | 22,836 | 20.08 | 3.3 | 22,836 | 20.08 | |||||||||||||||||||
89,386 | $ | 7.95 | 4.9 | 74,386 | $ | 9.28 | |||||||||||||||||||
The following table provides detail for non-vested shares under the Long-Term Incentive Plan as of December 31, 2013: | |||||||||||||||||||||||||
Weighted | |||||||||||||||||||||||||
Average | |||||||||||||||||||||||||
Number | Exercise | ||||||||||||||||||||||||
of shares | Price | ||||||||||||||||||||||||
Non-vested options December 31, 2012 | 10,520 | $ | 4.5 | ||||||||||||||||||||||
Granted | 15,000 | 1.36 | |||||||||||||||||||||||
Forfeited | (1,590 | ) | 4.5 | ||||||||||||||||||||||
Vested | (8,930 | ) | 4.5 | ||||||||||||||||||||||
Non-vested options December 31, 2013 | 15,000 | $ | 1.36 | ||||||||||||||||||||||
Under the aforementioned Long-Term Incentive Plan, approved by shareholders in May 2007, the Company is authorized to grant share-based incentive compensation awards for corporate performance to employees. These awards may be granted in form of shares of the Company’s common stock, performance-restricted restricted stock. | |||||||||||||||||||||||||
The vesting of awards is contingent upon meeting certain return on asset and return on equity goals. The awards are not permitted to be transferred during the restricted time period from the date of the award and are subject to forfeiture to the extent that the performance restrictions are not satisfied. Awards are also forfeited if the employee terminates his or her service prior to the end of the restricted time period, unless such termination is in accordance with the Company’s mandatory retirement age. Vested awards are converted to shares of the Company’s common stock at the end of the restricted time period. The fair market value of each employee based award is estimated based on the fair market value of the Company’s common stock on the date of the grant and probable performance goals to be achieved and estimated forfeitures. If such goals are not met then no compensation cost would be recognized and any recognized compensation cost would be reversed. There were no shares of restricted stock outstanding at December 31, 2013. | |||||||||||||||||||||||||
EARNINGS_PER_COMMON_SHARE_EPS
EARNINGS PER COMMON SHARE ("EPS") | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
EARNINGS PER COMMON SHARE ("EPS") [Abstract] | ' | ||||||||||||
EARNINGS PER COMMON SHARE ("EPS") | ' | ||||||||||||
NOTE 18 - EARNINGS PER COMMON SHARE (“EPS”) | |||||||||||||
Basic and diluted EPS are calculated as follows: | |||||||||||||
For the year ended December 31, 2013 | |||||||||||||
Income | Average shares | Per share | |||||||||||
(In thousands, except for per share data) | (numerator) | (denominator) | Amount | ||||||||||
Basic and Diluted EPS | |||||||||||||
Income available to common shareholders | $ | 34 | 13,279 | $ | 0 | ||||||||
At December 31, 2013, 197,836 options to purchase shares of common stock and restricted stock awards were anti-dilutive in the computation of diluted EPS, as exercise price exceeded average market price. Additionally 30,407 warrants were also anti-dilutive. | |||||||||||||
For the year ended December 31, 2012 | |||||||||||||
Loss | Average shares | Per share | |||||||||||
(In thousands, except for per share data) | (numerator) | (denominator) | Amount | ||||||||||
Basic and Diluted EPS | |||||||||||||
Loss available to common shareholders | $ | (17,663 | ) | 13,257 | $ | (1.33 | ) | ||||||
At December 31, 2012, 362,093 options to purchase shares of common stock and restricted stock awards were anti-dilutive in the computation of diluted EPS, as exercise price exceeded average market price and as a result of the net loss for the year. Additionally 30,407 warrants were also anti-dilutive. |
COMPREHENSIVE_LOSS
COMPREHENSIVE LOSS | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
COMPREHENSIVE LOSS [Abstract] | ' | ||||||||||||
COMPREHENSIVE LOSS | ' | ||||||||||||
NOTE 19 – COMPREHENSIVE LOSS | |||||||||||||
ASC Topic 220 requires the reporting of all changes in equity during the reporting period except investments from and distributions to shareholders. Net income (loss) is a component of comprehensive income (loss) with all other components referred to in the aggregate as other comprehensive income (loss). | |||||||||||||
The components of other comprehensive (loss) income and the related tax effects for December 31, 2013 and 2012 are as follows: | |||||||||||||
For the year ended December 31, 2013 | |||||||||||||
(In thousands) | Before tax | Tax | Net of tax | ||||||||||
amount | expense | amount | |||||||||||
(benefit) | |||||||||||||
Unrealized losses on investment securities: | |||||||||||||
Unrealized holding losses arising during period | $ | (10,291 | ) | $ | (3,572 | ) | $ | (6,719 | ) | ||||
Less reclassification adjustment for gains realized in net income | 158 | 54 | 104 | ||||||||||
Unrealized losses on investment securities | (10,449 | ) | (3,626 | ) | (6,823 | ) | |||||||
Unrecognized benefit obligation expense: | |||||||||||||
Actuarial gain | 950 | 323 | 627 | ||||||||||
Less reclassification adjustment for amortization | (328 | ) | (112 | ) | (216 | ) | |||||||
1,278 | 435 | 843 | |||||||||||
Other comprehensive loss, net | $ | (9,171 | ) | $ | (3,191 | ) | $ | (5,980 | ) | ||||
For the year ended December 31, 2012 | |||||||||||||
(In thousands) | Before tax | Tax | Net of tax | ||||||||||
amount | expense | amount | |||||||||||
(benefit) | |||||||||||||
Unrealized losses on investment securities: | |||||||||||||
Unrealized holding losses arising during period | $ | (1,573 | ) | $ | (535 | ) | $ | (1,038 | ) | ||||
Less adjustment for impaired investments | (2,359 | ) | (802 | ) | (1,557 | ) | |||||||
Less reclassification adjustment for gains realized in net loss | 1,030 | 350 | 680 | ||||||||||
Unrealized losses on investment securities | (244 | ) | (83 | ) | (161 | ) | |||||||
Unrecognized benefit obligation expense: | |||||||||||||
Actuarial loss | (1,655 | ) | (563 | ) | (1,092 | ) | |||||||
Less reclassification adjustment for amortization | (471 | ) | (160 | ) | (311 | ) | |||||||
(1,184 | ) | (403 | ) | (781 | ) | ||||||||
Other comprehensive loss, net | $ | (1,428 | ) | $ | (486 | ) | $ | (942 | ) | ||||
The other components of accumulated other comprehensive loss included in shareholders’ equity at December 31, 2013 and 2012 are as follows: | |||||||||||||
As of December 31, | |||||||||||||
(In thousands) | 2013 | 2012 | |||||||||||
Unrecognized benefit obligation | $ | (2,929 | ) | $ | (3,556 | ) | |||||||
Unrealized gains on AFS investments | (3,193 | ) | 3,414 | ||||||||||
Accumulated other comprehensive loss | $ | (6,122 | ) | $ | (142 | ) |
FAIR_VALUE_OF_FINANCIAL_INSTRU
FAIR VALUE OF FINANCIAL INSTRUMENTS | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
FAIR VALUE OF FINANCIAL INSTRUMENTS [Abstract] | ' | ||||||||||||||||||||
FAIR VALUE OF FINANCIAL INSTRUMENTS | ' | ||||||||||||||||||||
NOTE 20 - FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||||||||||
Under FASB ASC Topic 820 “Fair Value Measurements” (“ASC Topic 820”), fair values are based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When available, management uses quoted market prices to determine fair value. If quoted prices are not available, fair value is based upon valuation techniques such as matrix pricing or other models that use, where possible, current market-based or independently sourced market parameters, such as interest rates. If observable market-based inputs are not available, the Company uses unobservable inputs to determine appropriate valuation adjustments using discounted cash flow methodologies. | |||||||||||||||||||||
Management uses its best judgment in estimating the fair value of the Company’s financial instruments; however, there are inherent weaknesses in any estimation technique. Therefore, for substantially all financial instruments, the fair value estimates herein are not necessarily indicative of the amounts the Company could have realized in a sales transaction on the dates indicated. The estimated fair value amounts have been measured as of their respective period end and have not been re-evaluated or updated for purposes of these financial statements subsequent to those respective dates. As such, the estimated fair values of these financial instruments subsequent to the respective reporting dates may be different than the amounts reported at each period-end. | |||||||||||||||||||||
ASC Topic 820 provides guidance for estimating fair value when the volume and level of activity for an asset or liability has significantly declined and for identifying circumstances when a transaction is not orderly. ASC Topic 820 establishes a fair value hierarchy that prioritizes the inputs to valuation methods used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under ASC Topic 820 are as follows: | |||||||||||||||||||||
Level 1: | Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. | ||||||||||||||||||||
Level 2: | Quoted prices in markets that are not active, or inputs that are observable either directly or indirectly, for substantially the full term of the asset or liability. Level 2 includes debt securities with quoted prices that are traded less frequently then exchange-traded instruments. Valuation techniques include matrix pricing which is a mathematical technique used widely in the industry to value debt securities without relying exclusively on quoted market prices for the specific securities but rather by relying on the securities’ relationship to other benchmark quoted prices. | ||||||||||||||||||||
Level 3: | Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported with little or no market activity). | ||||||||||||||||||||
A financial instrument’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The Company did not have transfers of financial instruments within the fair value hierarchy during the three and twelve months ended December 31, 2013 and 2012. | |||||||||||||||||||||
Items Measured on a Recurring Basis | |||||||||||||||||||||
The Company’s available for sale investment securities are recorded at fair value on a recurring basis. | |||||||||||||||||||||
Fair value for Level 1 securities are determined by obtaining quoted market prices on nationally recognized securities exchanges. Level 1 securities include common stocks. | |||||||||||||||||||||
Level 2 securities include obligations of U.S. government-sponsored agencies, debt securities with quoted prices, which are traded less frequently than exchange-traded instruments, whose value is determined using matrix pricing with inputs that are observable in the market or can be derived principally from or corroborated by observable market data. The prices were obtained from third party vendors. This category generally includes the Company’mortgage-backed securities and CMOs issued by U.S. government and government-sponsored agencies, non-agency CMOs, and corporate and municipal bonds. | |||||||||||||||||||||
Level 3 securities include investments in seven private equity funds which are predominantly invested in real estate. The value of the private equity funds are derived from the funds’ financials and K-1 filings. The Company also reviews the funds’ asset values and its near-term projections. | |||||||||||||||||||||
For financial assets measured at fair value on a recurring basis, the fair value measurements by level within the fair value hierarchy used at December 31, 2013 and 2012 are as follows: | |||||||||||||||||||||
As of December 31, 2013 | Fair Value Measurements Using | ||||||||||||||||||||
(In thousands) | Level 1 | Level 2 | Level 3 | Fair Value | |||||||||||||||||
Assets | |||||||||||||||||||||
Investment securities available-for-sale | |||||||||||||||||||||
U.S. government agencies | $ | - | $ | 62,036 | $ | - | $ | 62,036 | |||||||||||||
Mortgage-backed securities-residential | - | 32,097 | - | 32,097 | |||||||||||||||||
Collateralized mortgage obligations: | |||||||||||||||||||||
Issued or guaranteed by U.S. government agencies | - | 189,103 | - | 189,103 | |||||||||||||||||
Non-agency | - | 4,479 | - | 4,479 | |||||||||||||||||
Corporate bonds | - | 9,438 | - | 9,438 | |||||||||||||||||
Municipal bonds | - | 6,900 | - | 6,900 | |||||||||||||||||
Other securities | - | - | 4,625 | 4,625 | |||||||||||||||||
Common stocks | 49 | - | - | 49 | |||||||||||||||||
Total available for sale | $ | 49 | $ | 304,053 | $ | 4,625 | $ | 308,727 | |||||||||||||
As of December 31, 2012 | Fair Value Measurements Using | ||||||||||||||||||||
(In thousands) | Level 1 | Level 2 | Level 3 | Fair Value | |||||||||||||||||
Assets | |||||||||||||||||||||
Investment securities available-for-sale | |||||||||||||||||||||
U.S. government agencies | $ | - | $ | 66,444 | $ | - | $ | 66,444 | |||||||||||||
Mortgage-backed securities-residential | - | 30,509 | - | 30,509 | |||||||||||||||||
Collateralized mortgage obligations: | |||||||||||||||||||||
Issued or guaranteed by U.S. government agencies | - | 233,976 | - | 233,976 | |||||||||||||||||
Non-agency | - | 1,011 | - | 1,011 | |||||||||||||||||
Corporate bonds | - | 7,437 | - | 7,437 | |||||||||||||||||
Municipal bonds | - | 5,615 | - | 5,615 | |||||||||||||||||
Other securities | - | - | 4,164 | 4,164 | |||||||||||||||||
Common stocks | 47 | - | - | 47 | |||||||||||||||||
Total available for sale | $ | 47 | $ | 344,992 | $ | 4,164 | $ | 349,203 | |||||||||||||
The following tables present additional information about assets measured at fair value on a recurring basis and for which the Company has utilized Level 3 inputs to determine fair value for the years ended December 31, 2013 and 2012: | |||||||||||||||||||||
(In thousands) | Other | ||||||||||||||||||||
Investment Securities Available for Sale | securities | ||||||||||||||||||||
Beginning balance January 1, 2013 | $ | 4,164 | |||||||||||||||||||
Total gains/(losses) - (realized/unrealized): | |||||||||||||||||||||
Included in earnings | 94 | ||||||||||||||||||||
Included in other comprehensive income | 850 | ||||||||||||||||||||
Purchases | 70 | ||||||||||||||||||||
Sales and calls | (553 | ) | |||||||||||||||||||
Transfers in and/or out of Level 3 | - | ||||||||||||||||||||
Ending balance December 31, 2013 | $ | 4,625 | |||||||||||||||||||
Trust | |||||||||||||||||||||
(In thousands) | preferred | Other | |||||||||||||||||||
Investment Securities Available for Sale | securities | securities | Total | ||||||||||||||||||
Beginning balance January 1, 2012 | $ | 12,603 | $ | 6,918 | $ | 19,521 | |||||||||||||||
Total gains/(losses) - (realized/unrealized): | |||||||||||||||||||||
Included in earnings | 126 | (1,817 | ) | (1,691 | ) | ||||||||||||||||
Included in other comprehensive income | (1,938 | ) | 79 | (1,859 | ) | ||||||||||||||||
Purchases | - | 788 | 788 | ||||||||||||||||||
Sales and calls | (10,773 | ) | (1,804 | ) | (12,577 | ) | |||||||||||||||
Amortization of premium | (18 | ) | - | (18 | ) | ||||||||||||||||
Transfers in and/or out of Level 3 | - | - | - | ||||||||||||||||||
Ending balance December 31, 2012 | $ | - | $ | 4,164 | $ | 4,164 | |||||||||||||||
Items Measured on a Nonrecurring Basis | |||||||||||||||||||||
Non-accrual loans and TDRs are evaluated for impairment on an individual basis under FASB ASC Topic 310 “Receivables”. The impairment analysis includes current collateral values, known relevant factors that may affect loan collectability, and risks inherent in different kinds of lending. When the collateral value or discounted cash flows less costs to sell is less than the carrying value of the loan a specific reserve (valuation allowance) is established. Loans held for sale are carried at the lower of cost or fair value. OREO is carried at the lower of cost or fair value. Fair value is based upon independent market prices, appraised values of the collateral or management’s estimation of the value of the real estate. Additionally, for collateral acquired from tax liens, fair value may be established using brokers opinions due to their lower carrying value. These assets are included as Level 3 fair values, based upon the lowest level of input that is significant to the fair value measurements. | |||||||||||||||||||||
For financial assets measured at fair value on a nonrecurring basis, the fair value measurements by level within the fair value hierarchy used at December 31, 2013 and 2012 are as follows: | |||||||||||||||||||||
As of December 31, 2013 | Fair Value Measurements Using | ||||||||||||||||||||
(In thousands) | Level 1 | Level 2 | Level 3 | Fair Value | |||||||||||||||||
Assets | |||||||||||||||||||||
Impaired loans | $ | - | $ | - | $ | 4,073 | $ | 4,073 | |||||||||||||
Other real estate owned | - | - | 9,182 | 9,182 | |||||||||||||||||
Loans and leases held for sale | - | - | 1,446 | 1,446 | |||||||||||||||||
As of December 31, 2012 | Fair Value Measurements Using | ||||||||||||||||||||
(In thousands) | Level 1 | Level 2 | Level 3 | Fair Value | |||||||||||||||||
Assets | |||||||||||||||||||||
Impaired loans | $ | - | $ | - | $ | 9,180 | $ | 9,180 | |||||||||||||
Other real estate owned | - | - | 7,632 | 7,632 | |||||||||||||||||
Loans and leases held for sale | - | - | 1,572 | 1,572 | |||||||||||||||||
The following table presents additional quantitative information about assets measured at fair value on a nonrecurring basis and for which the Company has utilized Level 3 inputs to determine fair value: | |||||||||||||||||||||
Qualitative Information about Level 3 Fair Value Measurements | |||||||||||||||||||||
As of December 31, 2013 | Valuation | Unobservable | Range (Weighted | ||||||||||||||||||
(In thousands) | Fair Value | Techniques | Input | Average) | |||||||||||||||||
Impaired loans and leases | $ | 4,073 | Appraisal of collateral (1) | Appraisal adjustments | 0.0% to -25.0% (-2.0%) | ||||||||||||||||
Liquidation expenses | 0.0% to -23.2% (-6.7%) | ||||||||||||||||||||
Salvageable value of | 0 | % | |||||||||||||||||||
collateral (2) | |||||||||||||||||||||
Other real estate owned | 9,182 | Appraisal of collateral (1) | Appraisal adjustments | 0.0% to -62.5% (-11.2%) | |||||||||||||||||
Sales prices | Liquidation expenses | -2.8% to -6.8% (-5.0%) | |||||||||||||||||||
Loans and leases held for sale | 1,446 | Sales prices (3) | |||||||||||||||||||
-1 | Appraisals or brokers opinions of collateral values may be adjusted for qualitative factors such as interior condition of the property and liquidation expenses. Fair value may also be based on negotiated settlements with the borrower. | ||||||||||||||||||||
-2 | Leases are measured using the salvageable value of the collateral. | ||||||||||||||||||||
-3 | Fair value was based on agreement with specific buyer. | ||||||||||||||||||||
The following methods and assumptions were used to estimate the fair values of the Company’s financial instruments at December 31, 2013 and 2012. The tables below indicate the fair value of the Company’s financial instruments at December 31, 2013 and 2012. The following information should not be interpreted as an estimate of the fair value of the entire Company since a fair value calculation is only provided for a limited portion of the Company’s assets and liabilities. Due to a wide range of valuation techniques and the degree of subjectivity used in making the estimates, comparisons between the Company’s disclosures and those of other companies may not be meaningful. The methodologies for estimating the fair value of financial instruments that are measured on a recurring or nonrecurring basis are discussed above. | |||||||||||||||||||||
Cash and cash equivalents (carried at cost): | |||||||||||||||||||||
The carrying amounts reported in the balance sheet for cash and short-term instruments approximate those assets’ fair values. | |||||||||||||||||||||
Securities: | |||||||||||||||||||||
Management uses quoted market prices to determine fair value of securities (level 1). If quoted prices are not available, fair value is based upon valuation techniques such as matrix pricing or other models that use, where possible, current market-based or independently sourced market parameters, such as interest rates (level 2). If observable market-based inputs are not available, the Company uses unobservable inputs to determine appropriate valuation adjustments by reviewing the private equities funds’ financials and K-1 filings and for trust preferred securities using discounted cash flow methodologies (level 3). | |||||||||||||||||||||
Other Investment (carried at cost): | |||||||||||||||||||||
This investment includes the Solomon Hess SBA Loan Fund, which the Company invested in to partially satisfy its community reinvestment requirement. Shares in this fund are not publicly traded and therefore have no readily determinable fair market value. An investor can have their investment in the Fund redeemed for the balance of their capital account at any quarter end with 60 days notice to the Fund. The investment in this Fund is recorded at cost. The Company does not record this investment at fair value on a recurring basis, as this investment’s carrying amount approximates fair value. | |||||||||||||||||||||
Restricted investment in bank stock (carried at cost): | |||||||||||||||||||||
The carrying amount of restricted investment in bank stock approximates fair value, and considers the limited marketability of such securities. | |||||||||||||||||||||
Loans held for sale (carried at the lower of cost or fair market value): | |||||||||||||||||||||
The fair values of loans held for sale are estimated using expected net sales proceeds. | |||||||||||||||||||||
Loans receivable (carried at cost): | |||||||||||||||||||||
The fair values of loans are estimated using discounted cash flow analyses, using market rates at the balance sheet date that reflect the credit and interest rate-risk inherent in the loans. Projected future cash flows are calculated based upon contractual maturity or call dates, projected repayments and prepayments of principal. Generally, for variable rate loans that re-price frequently and with no significant change in credit risk, fair values are based on carrying values. | |||||||||||||||||||||
Impaired loans (generally carried at fair value): | |||||||||||||||||||||
Impaired loans are accounted for under ASC Topic 310. Impaired loans are those in which the Company has measured impairment generally based on the fair value of the loan’s collateral. Fair value is generally determined based upon independent third-party appraisals of the properties, or discounted cash flows based on the expected proceeds. These assets are included as Level 3 fair values, based upon the lowest level of input that is significant to the fair value measurements. | |||||||||||||||||||||
Accrued interest receivable and payable (carried at cost): | |||||||||||||||||||||
The carrying amount of accrued interest receivable and accrued interest payable approximates its fair value. | |||||||||||||||||||||
Deposit liabilities (carried at cost): | |||||||||||||||||||||
The fair values disclosed for demand deposits (e.g., interest and noninterest checking, passbook savings and money market accounts) are, by definition, equal to the amount payable on demand at the reporting date (i.e., their carrying amounts). Fair values for fixed-rate certificates of deposit are estimated using a discounted cash flow calculation that applies interest rates currently being offered in the market on certificates to a schedule of aggregated expected monthly maturities on time deposits. | |||||||||||||||||||||
Short-term borrowings (carried at cost): | |||||||||||||||||||||
The carrying amounts of short-term borrowings approximate their fair values. | |||||||||||||||||||||
Long-term debt (carried at cost): | |||||||||||||||||||||
Fair values of FHLB advances and other long-term borrowings are estimated using discounted cash flow analysis, based on current rates for FHLB advances with similar credit risk characteristics, terms and remaining maturity. These prices obtained from this active market represent a market value that is deemed to represent the transfer price if the liability were assumed by a third party. | |||||||||||||||||||||
Subordinated debt (carried at cost): | |||||||||||||||||||||
Fair values of junior subordinated debt are estimated using discounted cash flow analysis, based on market rates currently offered on such debt with similar credit risk characteristics, terms and remaining maturity. | |||||||||||||||||||||
Off-balance sheet financial instruments (disclosed at cost): | |||||||||||||||||||||
Fair values for the Company’s off-balance sheet financial instruments (lending commitments and letters of credit) are based on fees currently charged in the market to enter into similar agreements, taking into account, the remaining terms of the agreements and the counterparties’ credit standing. They are not shown in the table because the amounts are immaterial. | |||||||||||||||||||||
Fair Value Measurements | |||||||||||||||||||||
At December 31, 2013 | |||||||||||||||||||||
Quoted Prices | |||||||||||||||||||||
in Active | Significant | ||||||||||||||||||||
Markets for | Other | Significant | |||||||||||||||||||
Identical | Observable | Unobservable | |||||||||||||||||||
Carrying | Estimated | Assets | Inputs | Inputs | |||||||||||||||||
(In thousands) | amount | fair value | Level 1 | Level 2 | Level 3 | ||||||||||||||||
Financial Assets: | |||||||||||||||||||||
Cash and cash equivalents | $ | 16,844 | $ | 16,844 | $ | 16,844 | $ | - | $ | - | |||||||||||
AFS investment securities | 308,727 | 308,727 | 49 | 304,053 | 4,625 | ||||||||||||||||
Other investment | 2,250 | 2,250 | - | - | 2,250 | ||||||||||||||||
Federal Home Loan Bank stock | 4,204 | 4,204 | - | - | 4,204 | ||||||||||||||||
Loans held for sale | 1,446 | 1,446 | - | - | 1,446 | ||||||||||||||||
Loans, net | 352,810 | 349,336 | - | - | 349,336 | ||||||||||||||||
Accrued interest receivable | 7,054 | 7,054 | - | 7,054 | - | ||||||||||||||||
Financial Liabilities: | |||||||||||||||||||||
Demand deposits | 60,473 | 60,473 | - | 60,473 | - | ||||||||||||||||
NOW and money markets | 210,053 | 210,053 | - | 210,053 | - | ||||||||||||||||
Savings | 17,593 | 17,593 | - | 17,593 | - | ||||||||||||||||
Time deposits | 240,845 | 239,102 | - | 239,102 | - | ||||||||||||||||
Short-term borrowings | 10,000 | 10,000 | 10,000 | - | - | ||||||||||||||||
Long-term borrowings | 97,881 | 94,896 | - | 94,896 | - | ||||||||||||||||
Subordinated debt | 25,774 | 26,000 | - | 26,000 | - | ||||||||||||||||
Accrued interest payable | 965 | 965 | - | 965 | - | ||||||||||||||||
Fair Value Measurements | |||||||||||||||||||||
At December 31, 2012 | |||||||||||||||||||||
Quoted Prices | |||||||||||||||||||||
in Active | Significant | ||||||||||||||||||||
Markets for | Other | Significant | |||||||||||||||||||
Identical | Observable | Unobservable | |||||||||||||||||||
Carrying | Estimated | Assets | Inputs | Inputs | |||||||||||||||||
(In thousands) | amount | fair value | Level 1 | Level 2 | Level 3 | ||||||||||||||||
Financial Assets: | |||||||||||||||||||||
Cash and cash equivalents | $ | 28,802 | $ | 28,802 | $ | 28,802 | $ | - | $ | - | |||||||||||
AFS investment securities | 349,203 | 349,203 | 47 | 344,992 | 4,164 | ||||||||||||||||
Other investment | 2,250 | 2,250 | - | - | 2,250 | ||||||||||||||||
Federal Home Loan Bank stock | 6,011 | 6,011 | - | - | 6,011 | ||||||||||||||||
Loans held for sale | 1,572 | 1,572 | - | - | 1,572 | ||||||||||||||||
Loans, net | 326,904 | 330,260 | - | - | 330,260 | ||||||||||||||||
Accrued interest receivable | 10,256 | 10,256 | - | 10,256 | - | ||||||||||||||||
Financial Liabilities: | |||||||||||||||||||||
Demand deposits | 58,531 | 58,531 | - | 58,531 | - | ||||||||||||||||
NOW and money markets | 223,279 | 223,279 | - | 223,279 | - | ||||||||||||||||
Savings | 17,472 | 17,472 | - | 17,472 | - | ||||||||||||||||
Time deposits | 255,635 | 251,532 | - | 251,532 | - | ||||||||||||||||
Long-term borrowings | 108,333 | 102,824 | - | 102,824 | - | ||||||||||||||||
Subordinated debt | 25,774 | 23,837 | - | 23,837 | - | ||||||||||||||||
Accrued interest payable | 3,760 | 3,760 | - | 3,760 | - | ||||||||||||||||
SEGMENT_INFORMATION
SEGMENT INFORMATION | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
SEGMENT INFORMATION [Abstract] | ' | ||||||||||||
SEGMENT INFORMATION | ' | ||||||||||||
NOTE 21 – SEGMENT INFORMATION | |||||||||||||
FASB ASC Topic 280, “Segment Reporting” (“ASC Topic 280”) established standards for public business enterprises to report information about operating segments in their annual financial statements and requires that those enterprises report selected information about operating segments in subsequent interim financial reports issued to shareholders. It also established standards for related disclosure about products and services, geographic areas, and major customers. Operating segments are components of an enterprise, which are evaluated regularly by the chief operating decision makers in deciding how to allocate and assess resources and performance. The Company’s chief operating decision makers are the Chief Executive Officer (“CEO”) and the Chief Administrative and Risk Officer (“CARO”). The Company has identified its reportable operating segments as “Community Banking” and “Tax Liens”. | |||||||||||||
Community banking | |||||||||||||
The Company’s Community Banking segment which includes Royal Bank consists of commercial and retail banking and leasing. The Community Banking business segment is managed as a single strategic unit which generates revenue from a variety of products and services provided by Royal Bank. For example, commercial lending is dependent upon the ability of Royal Bank to fund cash needed to make loans with retail deposits and other borrowings and to manage interest rate and credit risk. | |||||||||||||
Tax lien operation | |||||||||||||
The Company’s Tax Lien Operation consists of purchasing delinquent tax certificates from local municipalities at auction and then processing those liens to either encourage the property holder to pay off the lien, or to foreclose and sell the property. The tax lien operation earns income based on interest rates (determined at auction) and penalties assigned by the municipality, along with gains the on sale of foreclosed properties. | |||||||||||||
Selected segment information and reconciliations to consolidated financial information are as follows: | |||||||||||||
(In thousands) | Community | Tax Lien | |||||||||||
31-Dec-13 | Banking | Operation | Consolidated | ||||||||||
Total assets | $ | 707,022 | $ | 26,228 | $ | 733,250 | |||||||
Total deposits | 528,964 | - | 528,964 | ||||||||||
Interest income | $ | 25,097 | $ | 2,427 | $ | 27,524 | |||||||
Interest expense | 5,899 | 1,458 | 7,357 | ||||||||||
Net interest income | 19,198 | 969 | 20,167 | ||||||||||
(Credit) provision for loan and lease losses | (1,459 | ) | 587 | (872 | ) | ||||||||
Total non-interest income | 5,476 | 1,388 | 6,864 | ||||||||||
Total non-interest expenses | 21,959 | 4,371 | 26,330 | ||||||||||
Income tax (benefit) expense | 42 | - | 42 | ||||||||||
Net income (loss) | $ | 4,132 | $ | (2,601 | ) | $ | 1,531 | ||||||
Noncontrolling interest | 462 | (1,040 | ) | (578 | ) | ||||||||
Net income (loss) attributable to Royal Bancshares | $ | 3,670 | $ | (1,561 | ) | $ | 2,109 | ||||||
(In thousands) | Community | Tax Lien | |||||||||||
31-Dec-12 | Banking | Operation | Consolidated | ||||||||||
Total assets | $ | 732,137 | $ | 37,318 | $ | 769,455 | |||||||
Total deposits | 554,917 | - | 554,917 | ||||||||||
Interest income | $ | 26,956 | $ | 5,025 | $ | 31,981 | |||||||
Interest expense | 7,202 | 2,697 | 9,899 | ||||||||||
Net interest income | 19,754 | 2,328 | 22,082 | ||||||||||
Provision for loan and lease losses | 5,177 | 820 | 5,997 | ||||||||||
Total non-interest income | 2,868 | 741 | 3,609 | ||||||||||
Total non-interest expenses | 31,118 | 5,206 | 36,324 | ||||||||||
Income tax (benefit) expense | (28 | ) | 28 | - | |||||||||
Net loss | $ | (13,645 | ) | $ | (2,985 | ) | $ | (16,630 | ) | ||||
Noncontrolling interest | 189 | (1,194 | ) | (1,005 | ) | ||||||||
Net loss attributable to Royal Bancshares | $ | (13,834 | ) | $ | (1,791 | ) | $ | (15,625 | ) | ||||
Interest income earned by the Community Banking segment related to the Tax Lien Operation was approximately $1.5 million and $2.7 million for the years ended December 31, 2013 and 2012, respectively. |
CONDENSED_FINANCIAL_INFORMATIO
CONDENSED FINANCIAL INFORMATION - PARENT COMPANY ONLY | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
CONDENSED FINANCIAL INFORMATION - PARENT COMPANY ONLY [Abstract] | ' | ||||||||
CONDENSED FINANCIAL INFORMATION - PARENT COMPANY ONLY | ' | ||||||||
NOTE 22 - CONDENSED FINANCIAL INFORMATION - PARENT COMPANY ONLY | |||||||||
Condensed financial information for the parent company only follows. | |||||||||
CONDENSED BALANCE SHEETS | |||||||||
As of December 31, | |||||||||
(In thousands) | 2013 | 2012 | |||||||
Assets | |||||||||
Cash | $ | 1,333 | $ | 4,739 | |||||
Investment in non-bank subsidiaries | 29,795 | 25,830 | |||||||
Investment in Royal Bank | 42,165 | 44,725 | |||||||
Other assets | 15 | 238 | |||||||
Total assets | $ | 73,308 | $ | 75,532 | |||||
Subordinated debentures | $ | 25,774 | $ | 25,774 | |||||
Stockholders' equity | 47,534 | 49,758 | |||||||
Total liabilities and stockholders' equity | $ | 73,308 | $ | 75,532 | |||||
CONDENSED STATEMENTS OF OPERATIONS | |||||||||
For the years ended December 31, | |||||||||
(In thousands) | 2013 | 2012 | |||||||
Income | |||||||||
Other income | $ | 25 | $ | 20 | |||||
Total Income | 25 | 20 | |||||||
Expenses | |||||||||
Other expenses | 499 | 697 | |||||||
Interest on subordinated debentures | 809 | 683 | |||||||
Total Expenses | 1,308 | 1,380 | |||||||
Loss before income taxes and equity in undistributed net loss | (1,283 | ) | (1,360 | ) | |||||
Income tax expense | - | - | |||||||
Equity in undistributed net income (loss) | 3,392 | (14,265 | ) | ||||||
Net income (loss) | $ | 2,109 | $ | (15,625 | ) | ||||
CONDENSED STATEMENTS OF CASH FLOWS | |||||||||
For the years ended December 31, | |||||||||
(In thousands) | 2013 | 2012 | |||||||
Cash flows from operating activities | |||||||||
Net income (loss) | $ | 2,109 | $ | (15,625 | ) | ||||
Adjustments to reconcile net income (loss) to net cash used in operating activities: | |||||||||
Undistributed losses from subsidiaries | (3,392 | ) | 14,265 | ||||||
Interest on subordinated debentures | (2,419 | ) | 683 | ||||||
Net cash used in operating activities | (3,702 | ) | (677 | ) | |||||
Net cash provided by investing activities | - | - | |||||||
Cash flows from financing activities | |||||||||
Loan payoffs | - | 130 | |||||||
Other, net | 296 | 185 | |||||||
Net cash provided by financing activities | 296 | 315 | |||||||
Net decrease in cash and cash equivalents | (3,406 | ) | (362 | ) | |||||
Cash and cash equivalents at beginning of period | 4,739 | 5,101 | |||||||
Cash and cash equivalents at end of period | $ | 1,333 | $ | 4,739 | |||||
SUMMARY_OF_QUARTERLY_RESULTS_U
SUMMARY OF QUARTERLY RESULTS (UNAUDITED) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
SUMMARY OF QUARTERLY RESULTS (UNAUDITED) [Abstract] | ' | ||||||||||||||||
SUMMARY OF QUARTERLY RESULTS (UNAUDITED) | ' | ||||||||||||||||
NOTE 23 - SUMMARY OF QUARTERLY RESULTS (UNAUDITED) | |||||||||||||||||
The following summarizes the consolidated results of operations during 2013 and 2012, on a quarterly basis, for the Company: | |||||||||||||||||
For the year ended December 31, 2013 | |||||||||||||||||
(In thousands, except per share data) | Fourth | Third | Second | First | |||||||||||||
Quarter | Quarter | Quarter | Quarter | ||||||||||||||
Interest income | $ | 7,069 | $ | 6,960 | $ | 6,743 | $ | 6,752 | |||||||||
Net interest income | 5,379 | 5,070 | 4,946 | 4,772 | |||||||||||||
(Credit) provision for loan and lease losses | (676 | ) | 218 | (163 | ) | (251 | ) | ||||||||||
Net interest income after provision | 6,055 | 4,852 | 5,109 | 5,023 | |||||||||||||
Other income | 2,558 | 1,937 | 961 | 1,408 | |||||||||||||
Other expenses | 6,333 | 6,290 | 7,567 | 6,140 | |||||||||||||
Income (loss) before income tax | 2,280 | 499 | (1,497 | ) | 291 | ||||||||||||
Income tax expense | 42 | - | - | - | |||||||||||||
Net income (loss) from continuing operations | $ | 2,238 | $ | 499 | $ | (1,497 | ) | $ | 291 | ||||||||
Less net (loss) income attributable to noncontrolling interest | (214 | ) | 157 | (694 | ) | 173 | |||||||||||
Net income (loss) attributable to Royal Bancshares of Pennsylavania, Inc. | $ | 2,452 | $ | 342 | $ | (803 | ) | $ | 118 | ||||||||
Net income (loss) available to common shareholders | $ | 1,930 | $ | (178 | ) | $ | (1,321 | ) | $ | (397 | ) | ||||||
Net income (loss) per common share | |||||||||||||||||
Basic and diluted | $ | 0.14 | $ | (0.01 | ) | $ | (0.10 | ) | $ | (0.03 | ) | ||||||
Operating results for the fourth quarter of 2013 amounted to net income of $2.4 million compared to a net loss of $8.0 million for the fourth quarter of 2012. The year over year improvement in the quarterly results was primarily related to a $3.6 million drop in credit related expenses, a $3.3 million decrease in the provision for loan and lease losses, a $1.5 million decline in OTTI charges, $1.3 million in gains on the sale of two Company owned buildings and an increase in net interest income of $578,000. The progress achieved in credit quality and declining level of non-performing assets directly impacted OREO and loan collection expenses and the provision. The growth in net interest income was primarily attributed to a reduction in interest expense coupled with an increase in the yield on investments. | |||||||||||||||||
For the year ended December 31, 2012 | |||||||||||||||||
(In thousands, except per share data) | Fourth Quarter | Third Quarter | Second Quarter | First Quarter | |||||||||||||
Interest income | $ | 6,991 | $ | 7,761 | $ | 8,423 | $ | 8,806 | |||||||||
Net interest income | 4,801 | 5,382 | 5,906 | 5,993 | |||||||||||||
Provision for loan and lease losses | 2,637 | 1,761 | 1,515 | 84 | |||||||||||||
Net interest income after provision | 2,164 | 3,621 | 4,391 | 5,909 | |||||||||||||
Other income | (148 | ) | 1,151 | 1,945 | 661 | ||||||||||||
Other expenses | 10,256 | 9,409 | 8,592 | 8,067 | |||||||||||||
Loss before income tax | (8,240 | ) | (4,637 | ) | (2,256 | ) | (1,497 | ) | |||||||||
Net loss | $ | (8,240 | ) | $ | (4,637 | ) | $ | (2,256 | ) | $ | (1,497 | ) | |||||
Less net (loss) income attributable to noncontrolling interest | (246 | ) | 175 | (306 | ) | (628 | ) | ||||||||||
Net loss attributable to Royal Bancshares of Pennsylavania, Inc. | $ | (7,994 | ) | $ | (4,812 | ) | $ | (1,950 | ) | $ | (869 | ) | |||||
Net loss available to common shareholders | $ | (8,507 | ) | $ | (5,323 | ) | $ | (2,458 | ) | $ | (1,375 | ) | |||||
Net loss per common share | |||||||||||||||||
Basic and diluted | $ | (0.64 | ) | $ | (0.40 | ) | $ | (0.19 | ) | $ | (0.10 | ) |
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | ' | ||||||||||||
Principles of Consolidation | ' | ||||||||||||
Principles of Consolidation | |||||||||||||
The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Royal Investments of Delaware, Inc., Royal Captive Insurance Company, Royal Preferred, LLC, and Royal Bank, including Royal Bank’s subsidiaries, Royal Real Estate of Pennsylvania, Inc., Royal Investment America, LLC, RBA Property LLC, Narberth Property Acquisition LLC, and Rio Marina LLC. In addition, Royal Bank has a 60% ownership interest in Royal Bank America Leasing, LP. Royal Bank had a 60% ownership interest in Crusader Servicing Corporation (“CSC”) and Royal Tax Lien Services, LLC (“RTL”). Effective December 31, 2013, Royal Bank agreed to a $1.25 million cash settlement with the former President of CSC and RTL, in which Royal Bank acquired his 40% ownership interest in RTL for $850,000. The former President also relinquished his 20% ownership interest in CSC to Royal Bank. The combined value of the ownership interests was $2.6 million. The settlement resulted in a $1.5 million gain for Royal Bank which was recorded as an increase to Additional Paid in Capital within Stockholders Equity. As part of the cash settlement Royal Bank agreed to pay $400,000 for prior tax distributions. Additionally, the settlement agreement also includes a possible tax payment upon completion of the 2013 Forms K-1. Effective, December 31, 2013, Royal Bank is an 80% owner of CSC and 100% owner of RTL. The two Delaware trusts, Royal Bancshares Capital Trust I and Royal Bancshares Capital Trust II are not consolidated per requirements under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 810, “Consolidation” (“ASC Topic 810”). These consolidated financial statements reflect the historical information of the Company. All significant intercompany transactions and balances have been eliminated. | |||||||||||||
Use of Estimates | ' | ||||||||||||
Use of Estimates | |||||||||||||
In preparing the consolidated financial statements in accordance with United States generally accepted accounting principles (“U.S. GAAP”), management is required to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and the accompanying notes. These estimates and assumptions are based on information available as of the date of the consolidated financial statements; therefore, actual results could differ from those estimates. | |||||||||||||
The principal estimates that are particularly susceptible to significant change in the near term relate to the allowance for loan and lease losses, loans held for sale, the valuation of other real estate owned, the valuation of deferred tax assets, other-than-temporary impairment losses on investment securities, net periodic pension costs and the pension benefit obligation. In connection with the allowance for loan and lease losses estimate, management obtains independent appraisals for real estate collateral. However, future changes in real estate market conditions and the economy could affect the Company’s allowance for loan and lease losses. In addition, regulatory agencies, as an integral part of their examination process, periodically review the credit portfolio and the allowance. Such review may result in additional provisions based on their judgment of information available at the time of each examination. | |||||||||||||
Significant Concentration of Credit Risk | ' | ||||||||||||
Significant Concentration of Credit Risk | |||||||||||||
Credit risk is one of the Company’s most significant risks. It is critical for consistent profitability that the Company effectively manages credit risk. Most of the Company’s activities are with customers located within the Mid-Atlantic region of the country. “Note 3 – Investment Securities” to the Consolidated Financial Statements discusses the types of securities in which the Company invests. “Note 4 – Loans and Leases” to the Consolidated Financial Statements discusses the types of lending in which the Company engages. The Company does not have any portion of its business dependent on a single or limited number of customers, the loss of which would have a material adverse effect on its business. The Company has 92% of its investment portfolio in securities issued by government sponsored entities. The Company’s tax lien portfolio has a geographic concentration in the State of New Jersey. | |||||||||||||
No substantial portion of loans is concentrated within a single industry or group of related industries, except a significant majority of loans are secured by real estate. There are numerous risks associated with commercial and consumer lending that could impact the borrower’s ability to repay on a timely basis. They include, but are not limited to: the owner’s business expertise, changes in local, national, and in some cases international economies, competition, governmental regulation, and the general financial stability of the borrowing entity. Over the last few years, the Company had been impacted by deterioration in economic conditions as it pertains to real estate loans. The Company’s commercial real estate, commercial and construction and development loans comprised 40%, 22% and 12%, respectively, of the loan portfolio. | |||||||||||||
The Company attempts to mitigate these risks through conservative underwriting policies and procedures which include an analysis of the borrower’s business and industry history, its financial position, as well as that of the business owner. The Company will also require the borrower to provide current financial information on the operation of the business periodically over the life of the loan. In addition, most commercial loans are secured by assets of the business or those of the business owner, which can be liquidated if the borrower defaults, along with the personal surety of the business owner. | |||||||||||||
U.S. GAAP RAP Difference | ' | ||||||||||||
U.S. GAAP RAP Difference | |||||||||||||
In connection with a prior bank regulatory examination, the Federal Deposit Insurance Company (“FDIC”) concluded, based upon its interpretation of the Consolidated Reports of Condition and Income (the “Call Report”) instructions and under regulatory accounting principles (“RAP”), that income from Royal Bank’s tax lien business should be recognized on a cash basis, not an accrual basis. Royal Bank’s current accrual method is in accordance with U.S. GAAP. Royal Bank disagrees with the FDIC’s conclusion and filed the Call Report for December 31, 2013 and the previous 13 quarters in accordance with U.S. GAAP. However, the change in the manner of revenue recognition for the tax lien business for regulatory accounting purposes affects Royal Bank’s and potentially the Company’s capital ratios as disclosed in “Note 2 - Regulatory Matters and Significant Risks And Uncertainties” and “Note 15 - Regulatory Capital Requirements” to the Consolidated Financial Statements. The resolution of this matter will be decided by additional joint regulatory agency guidance which includes the Federal Reserve Bank, the FDIC, and the office of the Controller of the Currency ("OCC"). | |||||||||||||
Reclassifications | ' | ||||||||||||
Reclassifications | |||||||||||||
Certain items in the 2012 consolidated financial statements and accompanying notes have been reclassified to conform to the current year’s presentation format. There was no effect on net income or net loss for the periods presented herein as a result of the reclassification. | |||||||||||||
Restatement | ' | ||||||||||||
Restatement | |||||||||||||
In the fourth quarter of 2013, the Company recorded an error correction in previously issued financial statements related to net income tax receivables. The tax receivables were related to amended tax returns for 2005 through 2007, in which the Company carried back losses from 2008 through 2009. These amended returns were filed during the time period 2008 through 2011. In the fourth quarter of 2013, after an IRS joint committee concluded their review of the amended returns, management determined that the tax receivables would not be realized. The Company recorded a cumulative effect adjustment of $4.8 million to accumulated deficit, a component of the consolidated statement of changes in shareholders' equity, as of January 1, 2012 with the offsetting adjustment recorded to other assets and other liabilities. There was no effect on net income, net loss, or earnings or loss per basic and diluted shares for the periods presented herein as a result of the restatement. Below are the consolidated balance sheets and changes in shareholder equity statements that show the previously issued financial statement, the error correction, and the restated balances. | |||||||||||||
Royal Bancshares of Pennsylvania, Inc and Subsidiaries | |||||||||||||
Restatement of the Consolidated Balance Sheet | |||||||||||||
At December 31, 2012 | As | Adjustment | As Restated | ||||||||||
Originally | |||||||||||||
Reported | |||||||||||||
(In thousands) | |||||||||||||
Assets | |||||||||||||
Total cash and cash equivalents | $ | 28,802 | $ | - | $ | 28,802 | |||||||
Investment securities AFS, at fair value | 349,203 | - | 349,203 | ||||||||||
Other investment, at cost | 2,250 | - | 2,250 | ||||||||||
FHLB stock, at cost | 6,011 | - | 6,011 | ||||||||||
Loans and leases held for sale | 1,572 | - | 1,572 | ||||||||||
Loans and leases, net | 326,904 | - | 326,904 | ||||||||||
Bank owned life insurance | 14,585 | - | 14,585 | ||||||||||
Accrued interest receivable | 10,256 | - | 10,256 | ||||||||||
OREO, net | 13,435 | - | 13,435 | ||||||||||
Premises and equipment, net | 5,232 | - | 5,232 | ||||||||||
Other assets | 15,466 | (4,261 | ) | 11,205 | |||||||||
Total assets | $ | 773,716 | $ | (4,261 | ) | $ | 769,455 | ||||||
Liabilities | |||||||||||||
Total deposits | $ | 554,917 | $ | - | $ | 554,917 | |||||||
Long-term borrowings | 108,333 | - | 108,333 | ||||||||||
Subordinated debentures | 25,774 | - | 25,774 | ||||||||||
Accrued interest payable | 3,760 | - | 3,760 | ||||||||||
Other liabilities | 22,517 | 586 | 23,103 | ||||||||||
Total liabilities | 715,301 | 586 | 715,887 | ||||||||||
Shareholders' equity | |||||||||||||
Preferred stock | 29,396 | - | 29,396 | ||||||||||
Common stock | 23,065 | - | 23,065 | ||||||||||
Additional paid in capital | 126,287 | - | 126,287 | ||||||||||
Accumulated deficit | (117,080 | ) | (4,797 | ) | (121,877 | ) | |||||||
Accumulated other comprehensive loss | (142 | ) | - | (142 | ) | ||||||||
Treasury stock | (6,971 | ) | - | (6,971 | ) | ||||||||
Noncontrolling interest | 3,860 | (50 | ) | 3,810 | |||||||||
Shareholders' equity | 58,415 | (4,847 | ) | 53,568 | |||||||||
Total liabilities and shareholders' equity | $ | 773,716 | $ | (4,261 | ) | $ | 769,455 | ||||||
Royal Bancshares of Pennsylvania, Inc and Subsidiaries | |||||||||||||
Restatement of Consolidated Statement of Changes in Shareholders' Equity | |||||||||||||
At January 1, 2012 | As | Adjustment | As Restated | ||||||||||
Originally | |||||||||||||
Reported | |||||||||||||
(In thousands) | |||||||||||||
Preferred stock | $ | 28,878 | $ | - | $ | 28,878 | |||||||
Class A common stock | 22,723 | - | 22,723 | ||||||||||
Class B common stock | 208 | - | 208 | ||||||||||
Additional paid in capital | 126,245 | - | 126,245 | ||||||||||
Accumulated deficit | (100,803 | ) | (4,797 | ) | (105,600 | ) | |||||||
Accumulated other comprehensive income | 800 | - | 800 | ||||||||||
Treasury stock | (6,971 | ) | - | (6,971 | ) | ||||||||
Noncontrolling interest | 4,865 | (50 | ) | 4,815 | |||||||||
Total shareholders' equity | $ | 75,945 | $ | (4,847 | ) | $ | 71,098 | ||||||
Cash and Cash Equivalents | ' | ||||||||||||
Cash and Cash Equivalents | |||||||||||||
For purposes of reporting cash flows, cash and cash equivalents include cash on hand, amounts due from banks, interest-bearing deposits and federal funds sold. Generally, federal funds are purchased and sold for one-day periods. | |||||||||||||
Investment Securities | ' | ||||||||||||
Investment Securities | |||||||||||||
Management determines the appropriate classification of debt securities at the time of purchase and re-evaluates such designation as of each balance sheet date. Investments in debt securities that the Company has the positive intent and ability to hold to maturity are classified as held to maturity securities and reported at amortized cost. Debt and equity securities that are bought and held principally for the purpose of selling them in the near term are classified as trading securities and reported at fair value, with unrealized holding gains and losses included in earnings. Debt and equity securities not classified as trading securities, nor as held to maturity securities are classified as available for sale securities and reported at fair value, with unrealized holding gains or losses, net of deferred income taxes (when applicable), reported in the accumulated other comprehensive income component of shareholders’ equity. The Company did not hold trading securities nor had securities classified as held to maturity at December 31, 2013 and 2012. Discounts and premiums are accreted/amortized to income by use of the level-yield method. Gain or loss on sales of securities available for sale is based on the specific identification method. | |||||||||||||
The Company evaluates securities for other-than-temporary impairment (“OTTI”) at least on a quarterly basis. The Company assesses whether OTTI is present when the fair value of a security is less than its amortized cost. All investment securities are evaluated for OTTI under FASB ASC Topic 320, “Investments-Debt & Equity Securities” (“ASC Topic 320”). Non-agency collateralized mortgage obligations that are rated below AA are evaluated under FASB ASC Topic 320 Subtopic 40, “Beneficial Interests in Securitized Financial Assets” or under FASB ASC Topic 325, “Investments-Other” when applicable. In determining whether OTTI exists, management considers numerous factors, including but not limited to: (1) the length of time and the extent to which the fair value is less than the amortized cost, (2) the Company’s intent to hold or sell the security, (3) the financial condition and results of the issuer including changes in capital, (4) the credit rating of the issuer, (5) analysts’ earnings estimate, (6) industry trends specific to the security, and (7) timing of debt maturity and status of debt payments. | |||||||||||||
Under ASC Topic 320, OTTI is considered to have occurred with respect to debt securities (1) if an entity intends to sell the security; (2) if it is more likely than not an entity will be required to sell the security before recovery of its amortized cost basis; or (3) the present value of the expected cash flows is not sufficient to recover the entire amortized cost basis. In addition, the amount of the OTTI recognized in earnings depends on whether an entity intends to sell or will more likely than not be required to sell the security. If an entity intends to sell the security or will be required to sell the security, the OTTI shall be recognized in earnings equal to the entire difference between the fair value and the amortized cost basis at the balance sheet date. If an entity does not intend to sell the security and it is not more likely than not that the entity will be required to sell the security before the recovery of its amortized cost basis, the OTTI shall be separated into two amounts, the credit-related loss and the noncredit-related loss. The credit-related loss is based on the present value of the expected cash flows and is recognized in earnings. The noncredit-related loss is based on other factors such as illiquidity and is recognized in other comprehensive income. | |||||||||||||
Other Investment | ' | ||||||||||||
Other Investment | |||||||||||||
This investment includes the Solomon Hess SBA Loan Fund, which the Company invested in to partially satisfy its community reinvestment requirement. Shares in this fund are not publicly traded and therefore have no readily determinable fair market value. An investor can have their investment in the Fund redeemed for the balance of their capital account at any quarter end with a 60-day notice to the Fund. The investment in this Fund is recorded at cost. | |||||||||||||
Federal Home Loan Bank Stock | ' | ||||||||||||
Federal Home Loan Bank Stock | |||||||||||||
As a member of the Federal Home Loan Bank of Pittsburgh (“FHLB”), the Company is required to purchase and hold stock in the FHLB to satisfy membership and borrowing requirements. The stock can only be sold to the FHLB or to another member institution, and all sales of FHLB stock must be at par. As a result of these restrictions, there is no active market for the FHLB stock. As of December 31, 2013 and 2012, FHLB stock totaled $4.2 million and $6.0 million, respectively. | |||||||||||||
FHLB stock is held as a long-term investment and its value is determined based on the ultimate recoverability of the par value. The Company evaluates impairment quarterly. The decision of whether impairment exists is a matter of judgment that reflects management’s view of the FHLB’s long-term performance, which includes factors such as the following: (1) its operating performance, (2) the severity and duration of declines in the fair value of its net assets related to its capital stock amount, (3) its liquidity position, and (4) the impact of legislative and regulatory changes on the FHLB. Based on the capital adequacy and the liquidity position of the FHLB, management believes that the par value of its investment in FHLB stock will be realized. Accordingly, there is no other-than-temporary impairment related to the carrying amount of the Company’s FHLB stock as of December 31, 2013. | |||||||||||||
Loans Held for Sale | ' | ||||||||||||
Loans Held for Sale | |||||||||||||
At December 31, 2013, the Company’s loans held for sale (“LHFS”) were comprised of three loans totaling $1.4 million. The loans were transferred from loans held for investment (“LHFI”) to LHFS at fair market value using expected net sales proceeds. At the time of transfer to LHFS, a gain of $429,000 was recorded in non-interest income. Generally any subsequent credit losses on LHFS are recorded as a component of non-interest expense. At December 31, 2012, LHFS were comprised of one $1.6 million non-accrual commercial real estate loan. | |||||||||||||
Loans and Leases | ' | ||||||||||||
Loans and Leases | |||||||||||||
Loans and leases are classified as LHFI when management has the intent and ability to hold the loan or lease for the foreseeable future or until maturity or payoff. LHFI are stated at their outstanding unpaid principal balances, net of an allowance for loan and leases losses and any deferred fees or costs. Interest income is accrued on the unpaid principal balance. Loan origination fees, net of certain direct origination costs, are deferred and recognized as an adjustment of the yield (interest income) of the related loans. The Company is generally amortizing these amounts over the contractual life of the loan. The Company’s commercial and real estate loans, including construction and land development loans, are primarily in the greater Philadelphia metropolitan area as well as selected locations throughout the mid-Atlantic region. The Company also has participated with other financial institutions in selected construction and land development loans outside our geographic area. The Company has a concentration of credit risk in commercial real estate and construction and land development loans at December 31, 2013. | |||||||||||||
The Company classifies its leases as finance leases, in accordance with FASB ASC Topic 840, “Leases”. The difference between the Company’s gross investment in the lease and the cost or carrying amount of the leased property, if different, is recorded as unearned income, which is amortized to income over the lease term by the interest method. | |||||||||||||
For all classes of loans receivable, with the exception of tax certificates, the accrual of interest is discontinued on a loan when management believes that the borrower’s financial condition is such that collection of principal and interest is doubtful or when a loan becomes 90 days past due. When a loan is placed on non-accrual all unpaid interest is reversed from interest income. Interest payments received on impaired nonaccrual loans are normally applied against principal. Excess proceeds received over the principal amounts due on impaired loans are recognized as income on a cash basis. Generally, loans are restored to accrual status when the loan is brought current, has performed in accordance with the contractual terms for a reasonable period of time (generally six months) and the ultimate collectibility of the total contractual principal and interest is no longer in doubt. The past due status of all classes of loans receivable is determined based on contractual due dates for loan payments. Tax certificates have no contractual maturity. Collection is dependent upon the tax payer’s redemption of the lien, which includes principal interest and fees. | |||||||||||||
A loan modification is deemed a troubled debt restructuring (“TDR”) when two conditions are met: 1) the borrower is experiencing financial difficulty and 2) a concession is made by the Company that would not otherwise be considered for a borrower with similar credit risk characteristics. If in modifying a loan the Company, for economic or legal reasons related to a borrower’s financial difficulties, grants a concession it would not normally consider then the loan modification is classified as a TDR. All loans classified as TDRs are considered to be impaired. TDRs are returned to an accrual status when the loan is brought current, has performed in accordance with the contractual restructured terms for a reasonable period of time (generally six months) and the ultimate collectibility of the total contractual restructured principal and interest is no longer in doubt. The Company’s policy for TDRs is to recognize interest income on currently performing restructured loans under the accrual method. | |||||||||||||
The Company accounts for guarantees in accordance with FASB ASC Topic 460 “Guarantees” (“ASC Topic 460”). ASC Topic 460 requires a guarantor entity, at the inception of a guarantee covered by the measurement provisions of the interpretation, to record a liability for the fair value of the obligation undertaken in issuing the guarantee. The Company has financial and performance letters of credit. Financial letters of credit require the Company to make a payment if the customer’s condition deteriorates, as defined in agreements. Performance letters of credits require the Company to make payments if the customer fails to perform certain non-financial contractual obligations. | |||||||||||||
Allowance for Loan and Lease Losses | ' | ||||||||||||
Allowance for Loan and Lease Losses | |||||||||||||
The Company’s loan and lease portfolio (the “credit portfolio”) is subject to varying degrees of credit risk. The Company maintains an allowance for loan and lease losses (the “allowance”) to absorb losses in the loan and lease portfolio. The allowance is based on the review and evaluation of the loan and lease portfolio, along with ongoing, quarterly assessments of the probable losses inherent in that portfolio. The allowance represents an estimation made pursuant to FASB ASC Topic 450, “Contingencies” (“ASC Topic 450”) or FASB ASC Topic 310, “Receivables” (“ASC Topic 310”). The adequacy of the allowance is determined through evaluation of the credit portfolio, and involves consideration of a number of factors, as outlined below, to establish a prudent level. | |||||||||||||
Determination of the allowance is inherently subjective and requires significant estimates, including estimated losses on pools of homogeneous loans and leases based on historical loss experience and consideration of current economic trends, which may be susceptible to significant change. Loans and leases deemed uncollectible are charged against the allowance, while recoveries are credited to the allowance. Management adjusts the level of the allowance through the provision for loan and lease losses, which is recorded as a current period expense. The Company’s systematic methodology for assessing the appropriateness of the allowance includes: (1) general reserves reflecting historical loss rates by loan type, (2) specific reserves for risk-rated credits based on probable losses on an individual or portfolio basis and (3) qualitative reserves based upon current economic conditions and other risk factors. | |||||||||||||
The loan portfolio is stratified into loan segments that have similar risk characteristics. The general allowance is based upon historical loss rates using a three-year rolling average of the historical loss experienced within each loan segment. The qualitative factors used to adjust the historical loss experience address various risk characteristics of the Company’s loan and lease portfolio include evaluating: (1) trends in delinquencies and other non-performing loans, (2) changes in the risk profile related to large loans in the portfolio, (3) changes in the growth trends of categories of loans comprising the loan and lease portfolio, (4) concentrations of loans and leases to specific industry segments, (5) changes in economic conditions on both a local and national level, (6) quality of loan review and board oversight, (7) changes in lending policies and procedures, and (8) changes in lending staff. Each factor is assigned a value to reflect improving, stable or declining conditions based on management’s best judgment using relevant information available at the time of the evaluation. Adjustments to the factors are supported through documentation of changes in conditions in a report accompanying the allowance calculation. | |||||||||||||
The allowance calculation methodology includes further segregation of loan classes into risk rating categories. The borrower’s overall financial condition, repayment sources, guarantors and value of collateral, if appropriate, are evaluated annually for commercial loans or when credit deficiencies arise, such as delinquent loan payments, for commercial and consumer loans. Credit quality risk ratings include regulatory classifications of special mention, substandard, doubtful and loss. Loans classified as special mention have potential weaknesses that deserve management’s close attention. If uncorrected, the potential weaknesses may result in deterioration of the repayment prospects. Loans classified as substandard have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They include loans that are inadequately protected by the current sound net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans classified as doubtful have all the weaknesses inherent in loans classified substandard with the added characteristic that collection or liquidation in full, on the basis of current conditions and facts, is highly improbable. Loans classified as a loss are considered uncollectible and are charged to the allowance for loan losses. Loans not classified are rated pass. | |||||||||||||
The specific reserves are determined utilizing standards required under ASC Topic 310. A loan is considered impaired when it is probable that interest and principal will not be collected according to the contractual terms of the loan agreement. Non-accrual loans and loans restructured under a TDR are evaluated for impairment on an individual basis considering all known relevant factors that may affect loan collectability such as the borrower’s overall financial condition, resources and payment record, support available from financial guarantors and the sufficiency of current collateral values (current appraisals or rent rolls for income producing properties), and risks inherent in different kinds of lending (such as source of repayment, quality of borrower and concentration of credit quality). Non-accrual loans that experience insignificant payment shortfalls generally are not classified as 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. | |||||||||||||
Impairment is measured on a loan by loan basis for commercial and industrial loans, commercial real estate loans and commercial construction loans by either the present value of expected future cash flows discounted at the loan’s effective interest rate or the fair value of the collateral if the loan is collateral dependent. The estimated fair values of substantially all of the Company’s impaired loans are measured based on the estimated fair value of the loan’s collateral. The Company obtains third-party appraisals or real estate brokers’ opinions (“BPOs”) to establish the fair value of real estate collateral. Appraised values or BPOs are discounted to arrive at the estimated selling price of the collateral, which is considered to be the estimated fair value. The discounts also include estimated costs to sell the property. For commercial and industrial loans secured by non-real estate collateral, such as accounts receivable, inventory and equipment, estimated fair values are determined based on the borrower’s financial statements, inventory reports, accounts receivable aging or equipment appraisals or invoices. Indications of value from these sources are generally discounted based on the age of the financial information or the quality of the assets. Large groups of smaller balance homogeneous loans are collectively evaluated for impairment. A specific reserve is established for an impaired loan for the amount that the carrying value exceeds its estimated fair value. Once a loan is determined to be impaired it will be deducted from the portfolio balance and the net remaining balance will be used in the general and qualitative analysis. | |||||||||||||
Based on management’s comprehensive analysis of the loan and lease portfolio, management believes the current level of the allowance is adequate at December 31, 2013. However, its determination requires significant judgment, and estimates of probable losses inherent in the credit portfolio can vary significantly from the amounts actually observed. While management uses available information to recognize probable losses, future changes to the allowance may be necessary. These changes could be based in the credits comprising the portfolio and changes in the financial condition of borrowers, as the result of changes in economic conditions. In addition, regulatory agencies, as an integral part of their examination process, periodically review the credit portfolio and the allowance. Such review may result in additional provisions based on their judgment of information available at the time of each examination, which may not be currently available to management. | |||||||||||||
Other Real Estate Owned | ' | ||||||||||||
Other Real Estate Owned | |||||||||||||
Assets acquired through, or in lieu of, loan foreclosure are held for sale and are initially recorded at fair value less costs to sell at the date of foreclosure, establishing a new cost basis. Foreclosed real estate properties acquired through the tax certificate portfolio are transferred at the lower of cost or fair value principally due to uncertainty around the fair value of the foreclosed properties. Subsequent to foreclosure, valuations are periodically performed by management and the assets are carried at the lower of carrying amount recorded at acquisition date or fair value less costs to sell. Third-party appraisals or agreements of sale are utilized to determine fair value the loan collateral while BPOs, agreements of sale, or in some cases, third-party appraisals are utilized to value properties from the tax certificate portfolio. Revenue and expenses from operations and changes in the valuation allowance are included in other expenses. For fair value measurement, OREO is included in level 3 assets. | |||||||||||||
Premises and Equipment | ' | ||||||||||||
Premises and Equipment | |||||||||||||
Land is carried at cost. Premises and equipment are stated at cost less accumulated depreciation, which is computed primarily using the modified accelerated cost recovery system (“MACRS”) over the estimated useful lives of the assets. Leasehold improvements are depreciated over the shorter of the estimated useful lives of the improvements or the terms of the related leases. Expected term includes lease options periods to the extent that the exercise of such options is reasonably assured. | |||||||||||||
Bank-Owned Life Insurance | ' | ||||||||||||
Bank-Owned Life Insurance | |||||||||||||
Royal Bank has purchased life insurance policies on certain executives. These policies are reflected on the consolidated balance sheets at their cash surrender value, or the amount that can be realized. Income from these policies and changes in the cash surrender value are recorded in other income. | |||||||||||||
Advertising Costs | ' | ||||||||||||
Advertising Costs | |||||||||||||
Advertising costs are expensed as incurred. The Company’s advertising costs were $209,000 and $127,000 for 2013 and 2012, respectively. | |||||||||||||
Benefit Plans | ' | ||||||||||||
Benefit Plans | |||||||||||||
The Company has a noncontributory nonqualified, defined benefit pension plan covering certain eligible employees. The plan provides retirement benefits under pension trust agreements. The benefits are based on years of service and the employee’s compensation during the highest three consecutive years during the last 10 years of employment. Net pension expense consists of service costs and interest costs. The Company accrues pension costs as incurred. | |||||||||||||
The Company has a capital accumulation and salary reduction plan under Section 401(k) of the Internal Revenue Code of 1986, as amended. Under the plan, all employees are eligible to contribute up to the maximum allowed by Internal Revenue Service (“IRS”) regulation, with the Company matching 100% of any contribution between 1% and 5% subject to a $2,500 per employee annual limit. During 2013 and 2012, no matching contribution was made as a result of a management decision to reduce costs. | |||||||||||||
Stock Compensation | ' | ||||||||||||
Stock Compensation | |||||||||||||
FASB ASC Topic 718, “Compensation-Stock Compensation” (“ASC Topic 718”) requires that the compensation cost relating to share-based payment transactions be recognized in consolidated financial statements. The costs are measured based on the fair value of the equity or liability instruments issued. ASC Topic 718 covers a wide range of share-based compensation arrangements including stock options, restricted share plans, performance-based awards, share appreciation rights, and employee share purchase plans. The effect of ASC Topic 718 is to require entities to measure the cost of employee services received in exchange for stock options based on the grant-date fair value of the award, and to recognize the cost over the period the employee is required to provide services for the award. ASC Topic 718 permits entities to use any option-pricing model that meets the fair value objective in the Statement. The Company recorded compensation expense relating to stock options and restricted stock of $22,000 and $42,000 during 2013 and 2012, respectively. | |||||||||||||
At December 31, 2013, the Company had a director stock-based plan, an employee stock-based plan, and a long-term incentive compensation plan, which are more fully described in “Note 17 – Stock Compensation Plans” to the Consolidated Financial Statements. | |||||||||||||
Trust Preferred Securities | ' | ||||||||||||
Trust Preferred Securities | |||||||||||||
Royal Bancshares Capital Trust I/II (“Trusts”) issued mandatory redeemable preferred stock to investors and loaned the proceeds to the Company. The Trusts hold, as their sole asset, subordinated debentures issued by the Company in 2004. The Company does not consolidate the Trusts as ASC Topic 810 precludes consideration of the call option embedded in the preferred stock when determining if the Company has the right to a majority of the Trusts expected returns. The non-consolidation results in the investment in common stock of the Trusts to be included in other assets with a corresponding increase in outstanding debt of $774,000. In addition, the income accrued on the Company’s common stock investments is included in other income. Refer to “Note 10 – Borrowings and Subordinated Debentures” to the Consolidated Financial Statements for more information. | |||||||||||||
Income Taxes | ' | ||||||||||||
Income Taxes | |||||||||||||
The Company accounts for income taxes in accordance with income tax accounting guidance (FASB ASC Topic 740, Income Taxes), which includes guidance related to accounting for uncertainty in income taxes, which sets out a consistent framework to determine the appropriate level of tax reserves to maintain for uncertain tax positions. The Company had no material unrecognized tax benefits or accrued interest and penalties as of December 31, 2013 and 2012. The Company’s policy is to account for interest as a component of interest expense and penalties as a component of other expense. | |||||||||||||
The Company and its subsidiaries file a consolidated federal income tax return. Income taxes are allocated to the Company and its subsidiaries based on the contribution of their income or use of their loss in the consolidated return. Separate state income tax returns are filed by the Company and its subsidiaries. The Company is subject to examination by taxing authorities for the years 2006, 2007 and 2009 through 2013. | |||||||||||||
Federal and state income taxes have been provided on the basis of reported income or loss. The amounts reflected on the tax returns differ from these provisions due principally to temporary differences in the reporting of certain items for financial reporting and income tax reporting purposes. The tax effect of these temporary differences is accounted for as deferred taxes applicable to future periods. Deferred income tax expense or benefit is determined by recognizing deferred tax assets and liabilities for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred assets and liabilities of a change in tax rates is recognized in earnings in the period that includes the enactment date. The realization of deferred tax assets is assessed and a valuation allowance provided for the full amount which is not more likely than not to be realized. | |||||||||||||
Treasury Stock | ' | ||||||||||||
Treasury Stock | |||||||||||||
Shares of common stock repurchased are recorded as treasury stock at cost. | |||||||||||||
Earnings (Losses) Per Share Information | ' | ||||||||||||
Earnings (Losses) Per Share Information | |||||||||||||
Basic per share data excludes dilution and is computed by dividing income (loss) available to common shareholders by the weighted average common shares outstanding during the period. Diluted per share data takes into account the potential dilution that could occur if securities or other contracts to issue common stock were exercised and converted into common stock, using the treasury stock method. | |||||||||||||
The Class B shares of the Company may be converted to Class A shares at the rate of 1.15 to 1. | |||||||||||||
Comprehensive Income (Loss) | ' | ||||||||||||
Comprehensive Income (Loss) | |||||||||||||
The Company reports comprehensive income (loss) in accordance with FASB ASC Topic 220, “Comprehensive Income” (“ASC Topic 220”), which requires the reporting of all changes in equity during the reporting period except investments from and distributions to shareholders. Net income (loss) is a component of comprehensive income (loss) with all other components referred to in the aggregate as other comprehensive income (loss). Comprehensive income (loss) consists of net income (loss) and other comprehensive income (loss). Other comprehensive income (loss) includes unrealized gains and losses on available for sale investment securities, non-credit related losses on other-than-temporarily impaired investment securities, and adjustment to net periodic pension cost. | |||||||||||||
Fair Value of Financial Instruments | ' | ||||||||||||
Fair Value of Financial Instruments | |||||||||||||
For information on the fair value of the Company’s financial instruments refer to “Note 20 - Fair Value of Financial Instruments” to the Consolidated Financial Statements. | |||||||||||||
Restrictions on Cash and Amounts Due From Banks | ' | ||||||||||||
Restrictions on Cash and Amounts Due From Banks | |||||||||||||
Royal Bank is required to maintain average balances on hand with the Federal Reserve Bank. At December 31, 2013 and 2012, these reserve balances amounted to $100,000. | |||||||||||||
Recent Accounting Pronouncements | ' | ||||||||||||
2. Recent Accounting Pronouncements | |||||||||||||
In December 2011, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2011-11, Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities (“ASU 2011-11”). Because of the significant differences in requirements under U.S. GAAP and IFRS, FASB and the International Accounting Standards Board (“IASB”) are issuing joint requirements that will enhance current disclosures. Entities are required to disclose both gross information and net information about both instruments and transactions eligible for offset in the statement of financial position and instruments and transactions subject to an agreement similar to a master netting arrangement. This scope would include derivatives, sale and repurchase agreements and reverse sale and repurchase agreements, and securities borrowing and securities lending arrangements. The objective of this disclosure is to facilitate comparison between those entities that prepare their financial statements on the basis of U.S. GAAP and those entities that prepare their financial statements on the basis of IFRS. ASU 2011-11 is effective for annual periods beginning on or after January 1, 2013 and interim periods within those annual periods. An entity should provide the disclosures required by these amendments retrospectively for all comparative periods presented. The adoption of ASU 2011-11 did not have a significant impact on the Company’s consolidated financial statements. | |||||||||||||
In February 2013, the FASB issued ASU No. 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income (“ASU 2013-02”) to improve the reporting of reclassifications out of accumulated comprehensive income. ASU 2013-02 does not change the current requirements for reporting net income or other comprehensive income in financial statements. However, ASU 2013-02 requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, an entity is required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income but only if the amount reclassified is required under U.S. GAAP to be reclassified to net income in its entirety in the same reporting period. For other amounts that are not required under U.S. GAAP to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures required under U.S. GAAP that provide additional detail about those amounts. ASU 2013-02 is effective for reporting periods beginning after December 15, 2012. The adoption of ASU 2013-02 did not have a significant impact on the Company’s consolidated financial statements. | |||||||||||||
In February 2013, the FASB issued ASU No. 2013-04, Liabilities (Topic 405): Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation Is Fixed at the Reporting Date (ASU 2013-04). ASU 2013-04 provides guidance for the recognition, measurement and disclosure of obligations resulting from joint and several liability arrangements. ASU 2013-04 requires an entity to measure obligations resulting from joint and several liability arrangements for which the total amount of the obligation within the scope of this guidance is fixed at the reporting date, as the sum of the following: | |||||||||||||
a. The amount the reporting entity agreed to pay on the basis of its arrangement among its co-obligors | |||||||||||||
b. Any additional amount the reporting entity expects to pay on behalf of its co-obligors. | |||||||||||||
ASU 2013-04 also requires an entity to disclose the nature and amount of the obligation as well as other information about those obligations. For public companies ASU 2013-04 is effective for reporting periods beginning after December 15, 2013. The adoption of ASU 2013-04 is not expected to have a significant impact on the Company’s consolidated financial statements. | |||||||||||||
In July 2013, the FASB issued ASU No. 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (“ASU 2013-11”). Currently there is diversity in practice in the presentation of unrecognized tax benefits. The aim of ASU 2013-11 is to provide guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, similar tax loss, or tax credit carryforward exists. An unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, except for circumstances outlined in ASU 2013-11. For public companies ASU 2013-11 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. Early adoption is permitted. The adoption of ASU 2013-04 is not expected to have a significant impact on the Company’s consolidated financial statements. | |||||||||||||
In January 2014, FASB issued ASU No. 2014-04 Receivables (Topic 310): Troubled Debt Restructurings by Creditors (Subtopic 310-40) Reclassification of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure (“ASU 2014-04”). ASC Topic 310 includes guidance that states that a creditor should reclassify a collateralized mortgage loan such that the loan should be derecognized and the collateral asset recognized when it determines that there has been in substance a repossession or foreclosure by the creditor, that is, the creditor receives physical possession of the debtor’s assets regardless of whether formal foreclosure proceedings take place. However, the terms in substance a repossession or foreclosure and physical possession are not defined in the accounting literature and there is diversity about when a creditor should derecognize the loan receivable and recognize the real estate property. That diversity has been highlighted by recent extended foreclosure timelines and processes related to residential real estate properties. | |||||||||||||
The objectives in ASU 2014-04 are intended to reduce diversity in practice by clarifying when an in substance repossession or foreclosure occurs, that is, when a creditor should be considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan such that the loan should be derecognized and the real estate property recognized. Holding foreclosed real estate property presents different operational and economic risk to creditors compared with holding an impaired loan. Therefore, consistency in the timing of loan derecognition and presentation of foreclosed real estate properties is of qualitative significance to users of the creditor’s financial statements. Additionally, the disclosure of the amount of foreclosed residential real estate properties and of the recorded investment in consumer mortgage loans secured by residential real estate properties that are in the process of foreclosure is expected to provide decision-useful information to many users of the creditor’s financial statements. The amendments in ASU 2014-04 are effective for public business entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2014. An entity can elect to adopt the amendments in ASU 2014-04 using either a modified retrospective transition method or a prospective transition method. Early adoption is permitted. Early adoption is permitted. The adoption of ASU 2014-04 is not expected to have a significant impact on the Company’s consolidated financial statements. | |||||||||||||
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | ' | ||||||||||||
Schedule of Error Corrections and Prior Period Adjustments | ' | ||||||||||||
Below are the consolidated balance sheets and changes in shareholder equity statements that show the previously issued financial statement, the error correction, and the restated balances. | |||||||||||||
Royal Bancshares of Pennsylvania, Inc and Subsidiaries | |||||||||||||
Restatement of the Consolidated Balance Sheet | |||||||||||||
At December 31, 2012 | As | Adjustment | As Restated | ||||||||||
Originally | |||||||||||||
Reported | |||||||||||||
(In thousands) | |||||||||||||
Assets | |||||||||||||
Total cash and cash equivalents | $ | 28,802 | $ | - | $ | 28,802 | |||||||
Investment securities AFS, at fair value | 349,203 | - | 349,203 | ||||||||||
Other investment, at cost | 2,250 | - | 2,250 | ||||||||||
FHLB stock, at cost | 6,011 | - | 6,011 | ||||||||||
Loans and leases held for sale | 1,572 | - | 1,572 | ||||||||||
Loans and leases, net | 326,904 | - | 326,904 | ||||||||||
Bank owned life insurance | 14,585 | - | 14,585 | ||||||||||
Accrued interest receivable | 10,256 | - | 10,256 | ||||||||||
OREO, net | 13,435 | - | 13,435 | ||||||||||
Premises and equipment, net | 5,232 | - | 5,232 | ||||||||||
Other assets | 15,466 | (4,261 | ) | 11,205 | |||||||||
Total assets | $ | 773,716 | $ | (4,261 | ) | $ | 769,455 | ||||||
Liabilities | |||||||||||||
Total deposits | $ | 554,917 | $ | - | $ | 554,917 | |||||||
Long-term borrowings | 108,333 | - | 108,333 | ||||||||||
Subordinated debentures | 25,774 | - | 25,774 | ||||||||||
Accrued interest payable | 3,760 | - | 3,760 | ||||||||||
Other liabilities | 22,517 | 586 | 23,103 | ||||||||||
Total liabilities | 715,301 | 586 | 715,887 | ||||||||||
Shareholders' equity | |||||||||||||
Preferred stock | 29,396 | - | 29,396 | ||||||||||
Common stock | 23,065 | - | 23,065 | ||||||||||
Additional paid in capital | 126,287 | - | 126,287 | ||||||||||
Accumulated deficit | (117,080 | ) | (4,797 | ) | (121,877 | ) | |||||||
Accumulated other comprehensive loss | (142 | ) | - | (142 | ) | ||||||||
Treasury stock | (6,971 | ) | - | (6,971 | ) | ||||||||
Noncontrolling interest | 3,860 | (50 | ) | 3,810 | |||||||||
Shareholders' equity | 58,415 | (4,847 | ) | 53,568 | |||||||||
Total liabilities and shareholders' equity | $ | 773,716 | $ | (4,261 | ) | $ | 769,455 | ||||||
Royal Bancshares of Pennsylvania, Inc and Subsidiaries | |||||||||||||
Restatement of Consolidated Statement of Changes in Shareholders' Equity | |||||||||||||
At January 1, 2012 | As | Adjustment | As Restated | ||||||||||
Originally | |||||||||||||
Reported | |||||||||||||
(In thousands) | |||||||||||||
Preferred stock | $ | 28,878 | $ | - | $ | 28,878 | |||||||
Class A common stock | 22,723 | - | 22,723 | ||||||||||
Class B common stock | 208 | - | 208 | ||||||||||
Additional paid in capital | 126,245 | - | 126,245 | ||||||||||
Accumulated deficit | (100,803 | ) | (4,797 | ) | (105,600 | ) | |||||||
Accumulated other comprehensive income | 800 | - | 800 | ||||||||||
Treasury stock | (6,971 | ) | - | (6,971 | ) | ||||||||
Noncontrolling interest | 4,865 | (50 | ) | 4,815 | |||||||||
Total shareholders' equity | $ | 75,945 | $ | (4,847 | ) | $ | 71,098 |
INVESTMENT_SECURITIES_Tables
INVESTMENT SECURITIES (Tables) | 12 Months Ended | ||||||||||||||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||||||||||||||
INVESTMENT SECURITIES [Abstract] | ' | ||||||||||||||||||||||||||||||||||||
Amortized cost, gross unrealized gains and losses, and fair value of available-for-sale investment securities | ' | ||||||||||||||||||||||||||||||||||||
The amortized cost, gross unrealized gains and losses, and fair value of the Company’s available-for-sale investment securities are summarized as follows: | |||||||||||||||||||||||||||||||||||||
As of December 31, 2013 | Included in AOCL* | ||||||||||||||||||||||||||||||||||||
(In thousands) | Amortized | Gross | Gross | Fair value | |||||||||||||||||||||||||||||||||
cost | unrealized | unrealized | |||||||||||||||||||||||||||||||||||
gains | losses | ||||||||||||||||||||||||||||||||||||
Investment securities available-for-sale | |||||||||||||||||||||||||||||||||||||
U.S. government agencies | $ | 68,207 | $ | - | $ | (6,171 | ) | $ | 62,036 | ||||||||||||||||||||||||||||
Mortgage-backed securities-residential | 32,769 | 210 | (882 | ) | 32,097 | ||||||||||||||||||||||||||||||||
Collateralized mortgage obligations: | |||||||||||||||||||||||||||||||||||||
Issued or guaranteed by U.S. government agencies | 188,194 | 2,887 | (1,978 | ) | 189,103 | ||||||||||||||||||||||||||||||||
Non-agency | 4,454 | 25 | - | 4,479 | |||||||||||||||||||||||||||||||||
Corporate bonds | 9,669 | 25 | (256 | ) | 9,438 | ||||||||||||||||||||||||||||||||
Municipal bonds | 7,163 | - | (263 | ) | 6,900 | ||||||||||||||||||||||||||||||||
Common stocks | 33 | 16 | - | 49 | |||||||||||||||||||||||||||||||||
Other securities | 3,363 | 1,405 | (143 | ) | 4,625 | ||||||||||||||||||||||||||||||||
Total available for sale | $ | 313,852 | $ | 4,568 | $ | (9,693 | ) | $ | 308,727 | ||||||||||||||||||||||||||||
As of December 31, 2012 | Included in AOCL* | ||||||||||||||||||||||||||||||||||||
(In thousands) | Amortized | Gross | Gross | Fair value | |||||||||||||||||||||||||||||||||
cost | unrealized | unrealized | |||||||||||||||||||||||||||||||||||
gains | losses | ||||||||||||||||||||||||||||||||||||
Investment securities available-for-sale | |||||||||||||||||||||||||||||||||||||
U.S. government agencies | $ | 66,371 | $ | 151 | $ | (78 | ) | $ | 66,444 | ||||||||||||||||||||||||||||
Mortgage-backed securities-residential | 30,038 | 518 | (47 | ) | 30,509 | ||||||||||||||||||||||||||||||||
Collateralized mortgage obligations: | |||||||||||||||||||||||||||||||||||||
Issued or guaranteed by U.S. government agencies | 229,556 | 5,031 | (611 | ) | 233,976 | ||||||||||||||||||||||||||||||||
Non-agency | 1,007 | 4 | - | 1,011 | |||||||||||||||||||||||||||||||||
Corporate bonds | 7,477 | 32 | (72 | ) | 7,437 | ||||||||||||||||||||||||||||||||
Municipal bonds | 5,645 | - | (30 | ) | 5,615 | ||||||||||||||||||||||||||||||||
Common stocks | 33 | 14 | - | 47 | |||||||||||||||||||||||||||||||||
Other securities | 3,752 | 520 | (108 | ) | 4,164 | ||||||||||||||||||||||||||||||||
Total available for sale | $ | 343,879 | $ | 6,270 | $ | (946 | ) | $ | 349,203 | ||||||||||||||||||||||||||||
* | Accumulated other comprehensive loss | ||||||||||||||||||||||||||||||||||||
Amortized cost and fair value of investment securities, by contractual maturity | ' | ||||||||||||||||||||||||||||||||||||
The amortized cost and fair value of investment securities at December 31, 2013, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. | |||||||||||||||||||||||||||||||||||||
As of December 31, 2013 | |||||||||||||||||||||||||||||||||||||
(In thousands) | Amortized | Fair value | |||||||||||||||||||||||||||||||||||
cost | |||||||||||||||||||||||||||||||||||||
Within 1 year | $ | 11,806 | $ | 10,257 | |||||||||||||||||||||||||||||||||
After 1 but within 5 years | 6,432 | 6,359 | |||||||||||||||||||||||||||||||||||
After 5 but within 10 years | 33,519 | 31,246 | |||||||||||||||||||||||||||||||||||
After 10 years | 33,282 | 30,512 | |||||||||||||||||||||||||||||||||||
Mortgage-backed securities-residential | 32,769 | 32,097 | |||||||||||||||||||||||||||||||||||
Collateralized mortgage obligations: | |||||||||||||||||||||||||||||||||||||
Issued or guaranteed by U.S. government agencies | 188,194 | 189,103 | |||||||||||||||||||||||||||||||||||
Non-agency | 4,454 | 4,479 | |||||||||||||||||||||||||||||||||||
Total available for sale debt securities | 310,456 | 304,053 | |||||||||||||||||||||||||||||||||||
No contractual maturity | 3,396 | 4,674 | |||||||||||||||||||||||||||||||||||
Total available for sale securities | $ | 313,852 | $ | 308,727 | |||||||||||||||||||||||||||||||||
Gross realized gains and losses realized on sale of securities | ' | ||||||||||||||||||||||||||||||||||||
The following table summarizes gross realized gains and losses realized on the sale of securities recognized in earnings in the periods indicated: | |||||||||||||||||||||||||||||||||||||
For the years ended December 31, | |||||||||||||||||||||||||||||||||||||
(In thousands) | 2013 | 2012 | |||||||||||||||||||||||||||||||||||
Gross realized gains | $ | 416 | $ | 1,211 | |||||||||||||||||||||||||||||||||
Gross realized losses | (258 | ) | (181 | ) | |||||||||||||||||||||||||||||||||
Net realized gains | $ | 158 | $ | 1,030 | |||||||||||||||||||||||||||||||||
Investment securities in a continuous unrealized loss position | ' | ||||||||||||||||||||||||||||||||||||
The tables below indicate the length of time individual securities have been in a continuous unrealized loss position at December 31, 2013 and 2012: | |||||||||||||||||||||||||||||||||||||
As of December 31, 2013 | Less than 12 months | 12 months or longer | Total | ||||||||||||||||||||||||||||||||||
(In thousands) | Fair value | Gross | Number of | Fair value | Gross | Number of | Fair value | Gross | Number of | ||||||||||||||||||||||||||||
unrealized | positions | unrealized | positions | unrealized | positions | ||||||||||||||||||||||||||||||||
losses | losses | losses | |||||||||||||||||||||||||||||||||||
Investment securities available for sale | |||||||||||||||||||||||||||||||||||||
U.S. government agencies | $ | 48,919 | $ | (5,035 | ) | 16 | $ | 12,267 | $ | (1,136 | ) | 5 | $ | 61,186 | $ | (6,171 | ) | 21 | |||||||||||||||||||
Mortgage-backed securities-residential | 18,045 | (518 | ) | 7 | 6,276 | (364 | ) | 2 | 24,321 | (882 | ) | 9 | |||||||||||||||||||||||||
Collateralized mortgage obligations: | |||||||||||||||||||||||||||||||||||||
Issued or guaranteed by U.S. government agencies | 67,240 | (1,446 | ) | 21 | 9,974 | (532 | ) | 3 | 77,214 | (1,978 | 24 | ||||||||||||||||||||||||||
) | |||||||||||||||||||||||||||||||||||||
Corporate bonds | 4,848 | (221 | ) | 5 | 965 | (35 | ) | 1 | 5,813 | (256 | ) | 6 | |||||||||||||||||||||||||
Municipal bonds | 3,019 | (102 | ) | 5 | 3,881 | (161 | ) | 4 | 6,900 | (263 | ) | 9 | |||||||||||||||||||||||||
Other securities | - | - | - | 301 | (143 | ) | 2 | 301 | (143 | ) | 2 | ||||||||||||||||||||||||||
Total available for sale | $ | 142,071 | $ | (7,322 | ) | 54 | $ | 33,664 | $ | (2,371 | ) | 17 | $ | 175,735 | $ | (9,693 | ) | 71 | |||||||||||||||||||
As of December 31, 2012 | Less than 12 months | 12 months or longer | Total | ||||||||||||||||||||||||||||||||||
(In thousands) | Fair value | Gross | Number | Fair value | Gross | Number of | Fair value | Gross | Number | ||||||||||||||||||||||||||||
unrealized | of | unrealized | positions | unrealized | of | ||||||||||||||||||||||||||||||||
losses | positions | losses | losses | positions | |||||||||||||||||||||||||||||||||
Investment securities available for sale | |||||||||||||||||||||||||||||||||||||
U.S. government agencies | $ | 23,818 | $ | (78 | ) | 8 | $ | - | $ | - | - | $ | 23,818 | $ | (78 | ) | 8 | ||||||||||||||||||||
Mortgage-backed securities-residential | 7,280 | (47 | ) | 2 | - | - | - | 7,280 | (47 | ) | 2 | ||||||||||||||||||||||||||
Collateralized mortgage obligations: | |||||||||||||||||||||||||||||||||||||
Issued or guaranteed by U.S. government agencies | 44,937 | (592 | ) | 15 | 3,975 | (19 | ) | 2 | 48,912 | (611 | 17 | ||||||||||||||||||||||||||
) | |||||||||||||||||||||||||||||||||||||
Corporate bonds | 2,165 | (13 | ) | 2 | 941 | (59 | ) | 1 | 3,106 | (72 | ) | 3 | |||||||||||||||||||||||||
Municipal bonds | 4,597 | (21 | ) | 5 | 882 | (9 | ) | 1 | 5,479 | (30 | ) | 6 | |||||||||||||||||||||||||
Other securities | 289 | (38 | ) | 1 | 255 | (70 | ) | 1 | 544 | (108 | ) | 2 | |||||||||||||||||||||||||
Total available for sale | $ | 83,086 | $ | (789 | ) | 33 | $ | 6,053 | $ | (157 | ) | 5 | $ | 89,139 | $ | (946 | ) | 38 | |||||||||||||||||||
Schedule of credit related impairment losses on debt securities held, for portion of OTTI was recognized in other comprehensive income | ' | ||||||||||||||||||||||||||||||||||||
The following table presents a roll-forward of the balance of credit-related impairment losses on debt securities held at December 31, 2013 and 2012 for which a portion of an other-than-temporary impairment was recognized in other comprehensive income: | |||||||||||||||||||||||||||||||||||||
(In thousands) | 2013 | 2012 | |||||||||||||||||||||||||||||||||||
Balance at January 1, | $ | 173 | $ | 173 | |||||||||||||||||||||||||||||||||
Reductions for securities sold during the period (realized) | (173 | ) | - | ||||||||||||||||||||||||||||||||||
Balance at December 31, | $ | - | $ | 173 | |||||||||||||||||||||||||||||||||
The following table summarizes other-than-temporary impairment losses on securities recognized in earnings in the periods indicated: | |||||||||||||||||||||||||||||||||||||
For the years ended December 31, | |||||||||||||||||||||||||||||||||||||
(In thousands) | 2013 | 2012 | |||||||||||||||||||||||||||||||||||
Other securities | $ | - | $ | 2,359 | |||||||||||||||||||||||||||||||||
Total OTTI recognized in earnings | $ | - | $ | 2,359 |
LOANS_AND_LEASES_Tables
LOANS AND LEASES (Tables) | 12 Months Ended | ||||||||||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||||||||||
LOANS AND LEASES [Abstract] | ' | ||||||||||||||||||||||||||||||||
Major classifications of loans held for investment | ' | ||||||||||||||||||||||||||||||||
Major classifications of LHFI are as follows: | |||||||||||||||||||||||||||||||||
As of December 31, | |||||||||||||||||||||||||||||||||
(In thousands) | 2013 | 2012 | |||||||||||||||||||||||||||||||
Commercial real estate | $ | 148,293 | $ | 167,115 | |||||||||||||||||||||||||||||
Construction and land development | 45,261 | 37,215 | |||||||||||||||||||||||||||||||
Commercial and industrial | 79,589 | 40,560 | |||||||||||||||||||||||||||||||
Multi-family | 11,737 | 11,756 | |||||||||||||||||||||||||||||||
Residential real estate | 25,535 | 24,981 | |||||||||||||||||||||||||||||||
Leases | 42,524 | 37,347 | |||||||||||||||||||||||||||||||
Tax certificates | 12,716 | 24,569 | |||||||||||||||||||||||||||||||
Consumer | 826 | 1,139 | |||||||||||||||||||||||||||||||
366,481 | 344,682 | ||||||||||||||||||||||||||||||||
Less: Deferred loan fees, net* | - | (517 | ) | ||||||||||||||||||||||||||||||
Total LHFI, net of unearned income | $ | 366,481 | $ | 344,165 | |||||||||||||||||||||||||||||
*For the 2013 period net deferred fees were allocated among the various loan types. | |||||||||||||||||||||||||||||||||
Risk ratings for each loan portfolio segment | ' | ||||||||||||||||||||||||||||||||
The following tables present risk ratings for each loan portfolio segment at December 31, 2013 and 2012, excluding LHFS. | |||||||||||||||||||||||||||||||||
As of December 31, 2013 | Special | ||||||||||||||||||||||||||||||||
(In thousands) | Pass | Pass-Watch | Mention | Substandard | Non-accrual | Total | |||||||||||||||||||||||||||
Commercial real estate | $ | 99,525 | $ | 32,267 | $ | 11,572 | $ | 2,604 | $ | 2,325 | $ | 148,293 | |||||||||||||||||||||
Construction and land development | 14,677 | 16,270 | 11,095 | 569 | 2,650 | 45,261 | |||||||||||||||||||||||||||
Commercial & industrial | 50,478 | 10,508 | 5,735 | 9,239 | 3,629 | 79,589 | |||||||||||||||||||||||||||
Multi-family | 10,792 | 410 | 535 | - | - | 11,737 | |||||||||||||||||||||||||||
Residential real estate | 24,903 | - | - | - | 632 | 25,535 | |||||||||||||||||||||||||||
Leases | 41,325 | 485 | 247 | - | 467 | 42,524 | |||||||||||||||||||||||||||
Tax certificates | 12,262 | - | - | - | 454 | 12,716 | |||||||||||||||||||||||||||
Consumer | 750 | 76 | - | - | - | 826 | |||||||||||||||||||||||||||
Total LHFI | $ | 254,712 | $ | 60,016 | $ | 29,184 | $ | 12,412 | $ | 10,157 | $ | 366,481 | |||||||||||||||||||||
As of December 31, 2012 | Special | ||||||||||||||||||||||||||||||||
(In thousands) | Pass | Pass-Watch | Mention | Substandard | Non-accrual | Total | |||||||||||||||||||||||||||
Commercial real estate | $ | 64,308 | $ | 69,510 | $ | 19,529 | $ | 3,423 | $ | 10,345 | $ | 167,115 | |||||||||||||||||||||
Construction and land development | 2,139 | 13,872 | 16,343 | 581 | 4,280 | 37,215 | |||||||||||||||||||||||||||
Commercial & industrial | 14,764 | 10,774 | 92 | 9,969 | 4,961 | 40,560 | |||||||||||||||||||||||||||
Multi-family | 9,019 | 2,034 | 703 | - | - | 11,756 | |||||||||||||||||||||||||||
Residential real estate | 15,125 | 6,634 | 602 | 1,626 | 994 | 24,981 | |||||||||||||||||||||||||||
Leases | 36,755 | 325 | 16 | - | 251 | 37,347 | |||||||||||||||||||||||||||
Tax certificates | 23,968 | - | - | - | 601 | 24,569 | |||||||||||||||||||||||||||
Consumer | 926 | 213 | - | - | - | 1,139 | |||||||||||||||||||||||||||
Subtotal LHFI | 167,004 | 103,362 | 37,285 | 15,599 | 21,432 | 344,682 | |||||||||||||||||||||||||||
Less: Deferred loan fees | (517 | ) | |||||||||||||||||||||||||||||||
Total LHFI | $ | 344,165 | |||||||||||||||||||||||||||||||
Aging analysis of past due payments for each loan portfolio segment | ' | ||||||||||||||||||||||||||||||||
The following tables are an aging analysis of past due payments for each loan portfolio segment at December 31, 2013 and 2012, excluding LHFS. | |||||||||||||||||||||||||||||||||
As of December 31, 2013 | 30-59 Days | 60-89 Days | Accruing | Total | |||||||||||||||||||||||||||||
(In thousands) | Past Due | Past Due | 90+ Days | Non-accrual | Current | Total | |||||||||||||||||||||||||||
Commercial real estate | $ | 996 | $ | - | $ | - | $ | 2,325 | $ | 144,972 | $ | 148,293 | |||||||||||||||||||||
Construction and land development | - | - | - | 2,650 | 42,611 | 45,261 | |||||||||||||||||||||||||||
Commercial & industrial | 115 | 49 | - | 3,629 | 75,796 | 79,589 | |||||||||||||||||||||||||||
Multi-family | - | - | - | - | 11,737 | 11,737 | |||||||||||||||||||||||||||
Residential real estate | 458 | 262 | - | 632 | 24,183 | 25,535 | |||||||||||||||||||||||||||
Leases | 485 | 247 | - | 467 | 41,325 | 42,524 | |||||||||||||||||||||||||||
Tax certificates | - | - | - | 454 | 12,262 | 12,716 | |||||||||||||||||||||||||||
Consumer | - | - | - | - | 826 | 826 | |||||||||||||||||||||||||||
Total LHFI | $ | 2,054 | $ | 558 | $ | - | $ | 10,157 | $ | 353,712 | $ | 366,481 | |||||||||||||||||||||
As of December 31, 2012 | 30-59 Days | 60-89 Days | Accruing | Total | |||||||||||||||||||||||||||||
(In thousands) | Past Due | Past Due | 90+ Days | Non-accrual | Current | Total | |||||||||||||||||||||||||||
Commercial real estate | $ | 1,548 | $ | 1,486 | $ | - | $ | 10,345 | $ | 153,736 | $ | 167,115 | |||||||||||||||||||||
Construction and land development | - | - | - | 4,280 | 32,935 | 37,215 | |||||||||||||||||||||||||||
Commercial & industrial | 200 | - | - | 4,961 | 35,399 | 40,560 | |||||||||||||||||||||||||||
Multi-family | - | - | - | - | 11,756 | 11,756 | |||||||||||||||||||||||||||
Residential real estate | 562 | 486 | - | 994 | 22,939 | 24,981 | |||||||||||||||||||||||||||
Leases | 325 | 16 | - | 251 | 36,755 | 37,347 | |||||||||||||||||||||||||||
Tax certificates | - | - | - | 601 | 23,968 | 24,569 | |||||||||||||||||||||||||||
Consumer | - | - | - | - | 1,139 | 1,139 | |||||||||||||||||||||||||||
Subtotal LHFI | 2,635 | 1,988 | - | 21,432 | 318,627 | 344,682 | |||||||||||||||||||||||||||
Less: Deferred loan fees | (517 | ) | |||||||||||||||||||||||||||||||
Total LHFI | $ | 344,165 | |||||||||||||||||||||||||||||||
Composition of the non-accrual loans | ' | ||||||||||||||||||||||||||||||||
The following table details the composition of the non-accrual loans. | |||||||||||||||||||||||||||||||||
As of December 31, 2013 | As of December 31, 2012 | ||||||||||||||||||||||||||||||||
(In thousands) | Loan | Specific | Loan | Specific | |||||||||||||||||||||||||||||
balance | reserves | balance | reserves | ||||||||||||||||||||||||||||||
Non-accrual loans held for investment | |||||||||||||||||||||||||||||||||
Commercial real estate | $ | 2,325 | $ | 331 | $ | 10,345 | $ | 835 | |||||||||||||||||||||||||
Construction and land development | 2,650 | - | 4,280 | 820 | |||||||||||||||||||||||||||||
Commercial & industrial | 3,629 | 452 | 4,961 | 255 | |||||||||||||||||||||||||||||
Residential real estate | 632 | 19 | 994 | 14 | |||||||||||||||||||||||||||||
Leases | 467 | 60 | 251 | 55 | |||||||||||||||||||||||||||||
Tax certificates | 454 | 24 | 601 | 47 | |||||||||||||||||||||||||||||
Total non-accrual LHFI | $ | 10,157 | $ | 886 | $ | 21,432 | $ | 2,026 | |||||||||||||||||||||||||
Non-accrual loans held for sale | |||||||||||||||||||||||||||||||||
Commercial real estate | $ | - | $ | - | $ | 1,572 | $ | - | |||||||||||||||||||||||||
Total non-accrual LHFS | $ | - | $ | - | $ | 1,572 | $ | - | |||||||||||||||||||||||||
Total non-accrual loans | $ | 10,157 | $ | 886 | $ | 23,004 | $ | 2,026 | |||||||||||||||||||||||||
Information pertaining to impairment loans | ' | ||||||||||||||||||||||||||||||||
The following is a summary of information pertaining to impaired loans: | |||||||||||||||||||||||||||||||||
As of December 31, | |||||||||||||||||||||||||||||||||
(In thousands) | 2013 | 2012 | |||||||||||||||||||||||||||||||
Impaired LHFI with a valuation allowance | $ | 3,835 | $ | 9,405 | |||||||||||||||||||||||||||||
Impaired LHFI without a valuation allowance | 14,671 | 19,423 | |||||||||||||||||||||||||||||||
Impaired LHFS | - | 1,572 | |||||||||||||||||||||||||||||||
Total impaired loans and leases | $ | 18,506 | $ | 30,400 | |||||||||||||||||||||||||||||
Valuation allowance related to impaired LHFI | $ | 886 | $ | 2,026 | |||||||||||||||||||||||||||||
For the years ended December 31, | |||||||||||||||||||||||||||||||||
(In thousands) | 2013 | 2012 | |||||||||||||||||||||||||||||||
Average investment in impaired loans and leases | $ | 24,714 | $ | 39,412 | |||||||||||||||||||||||||||||
Interest income recognized on impaired loans and leases | $ | 559 | $ | 366 | |||||||||||||||||||||||||||||
Interest income recognized on a cash basis on impaired loans and leases | $ | 27 | $ | 66 | |||||||||||||||||||||||||||||
Troubled debt restructurings that are on an accrual status and a non-accrual status | ' | ||||||||||||||||||||||||||||||||
The following table details the Company’s TDRs that are on an accrual status and a non-accrual status at December 31, 2013 and 2012. | |||||||||||||||||||||||||||||||||
As of December 31, 2013 | |||||||||||||||||||||||||||||||||
(In thousands) | Number of | Accrual | Non-Accrual | Total TDRs | |||||||||||||||||||||||||||||
loans | Status | Status | |||||||||||||||||||||||||||||||
Commercial real estate | 3 | $ | 3,847 | $ | - | $ | 3,847 | ||||||||||||||||||||||||||
Construction and land development | 4 | 1,257 | 479 | 1,736 | |||||||||||||||||||||||||||||
Commercial & industrial | 3 | 4,420 | 1,960 | 6,380 | |||||||||||||||||||||||||||||
Residential real estate | 2 | - | 121 | 121 | |||||||||||||||||||||||||||||
Total | 12 | $ | 9,524 | $ | 2,560 | $ | 12,084 | ||||||||||||||||||||||||||
As of December 31, 2012 | |||||||||||||||||||||||||||||||||
(In thousands) | Number of | Accrual | Non-Accrual | Total TDRs | |||||||||||||||||||||||||||||
loans | Status | Status | |||||||||||||||||||||||||||||||
Commercial real estate | 4 | $ | 1,664 | $ | 854 | $ | 2,518 | ||||||||||||||||||||||||||
Construction and land development | 4 | 613 | 10,063 | 10,676 | |||||||||||||||||||||||||||||
Commercial & industrial | 2 | 5,290 | 2,457 | 7,747 | |||||||||||||||||||||||||||||
Residential real estate | 2 | - | 149 | 149 | |||||||||||||||||||||||||||||
Total | 12 | $ | 7,567 | $ | 13,523 | $ | 21,090 | ||||||||||||||||||||||||||
Newly restructured loans | ' | ||||||||||||||||||||||||||||||||
The following table presents newly restructured loans that occurred during the years ended December 31, 2013 and 2012. | |||||||||||||||||||||||||||||||||
Modifications by type for the year ended December 31, 2013 | |||||||||||||||||||||||||||||||||
(Dollars in thousands) | Number of | Rate | Term | Payment | Combination | Total | Pre- | Post- | |||||||||||||||||||||||||
loans | of types | Modification Outstanding | Modification Outstanding | ||||||||||||||||||||||||||||||
Recorded | Recorded | ||||||||||||||||||||||||||||||||
Investment | Investment | ||||||||||||||||||||||||||||||||
Commercial real estate | 2 | $ | - | $ | - | $ | - | $ | 3,705 | $ | 3,705 | $ | 3,761 | $ | 3,761 | ||||||||||||||||||
Commercial & industrial | 1 | - | - | - | 82 | 82 | 87 | 87 | |||||||||||||||||||||||||
Total | 3 | $ | - | $ | - | $ | - | $ | 3,787 | $ | 3,787 | $ | 3,848 | $ | 3,848 | ||||||||||||||||||
Modifications by type for the year ended December 31, 2012 | |||||||||||||||||||||||||||||||||
(Dollars in thousands) | Number of | Rate | Term | Payment | Combination | Total | Pre- | Post- | |||||||||||||||||||||||||
loans | of types | Modification Outstanding | Modification Outstanding | ||||||||||||||||||||||||||||||
Recorded | Recorded | ||||||||||||||||||||||||||||||||
Investment | Investment | ||||||||||||||||||||||||||||||||
Commercial real estate | 2 | $ | - | $ | - | $ | - | $ | 7,624 | $ | 7,624 | $ | 9,426 | $ | 9,426 | ||||||||||||||||||
Construction and land development | 1 | - | - | - | 282 | 282 | 290 | 290 | |||||||||||||||||||||||||
Commercial & industrial | 1 | - | - | 5,290 | - | 5,290 | 5,290 | 5,290 | |||||||||||||||||||||||||
Total | 4 | $ | - | $ | - | $ | 5,290 | $ | 7,906 | $ | 13,196 | $ | 15,006 | $ | 15,006 | ||||||||||||||||||
ALLOWANCE_FOR_LOAN_AND_LEASE_L1
ALLOWANCE FOR LOAN AND LEASE LOSSES (Tables) | 12 Months Ended | ||||||||||||||||||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||||||||||||||||||
Allowance for Loan and Lease Losses [Abstract] | ' | ||||||||||||||||||||||||||||||||||||||||
Detail of the allowance and loan portfolio disaggregated by loan portfolio segment | ' | ||||||||||||||||||||||||||||||||||||||||
The following table presents the detail of the allowance and the loan portfolio disaggregated by loan portfolio segment as of December 31, 2013 and 2012. | |||||||||||||||||||||||||||||||||||||||||
Allowance for Loan and Leases Losses and Loans Held for Investment | |||||||||||||||||||||||||||||||||||||||||
For the year ended December 31, 2013 | |||||||||||||||||||||||||||||||||||||||||
(In thousands) | Commercial | Construction | Commercial & industrial | Multi-family | Residential | Leases | Tax | Consumer | Unallocated | Total | |||||||||||||||||||||||||||||||
real estate | and land development | real estate | certificates | ||||||||||||||||||||||||||||||||||||||
Allowance for Loan and Leases Losses | |||||||||||||||||||||||||||||||||||||||||
Beginning balance | $ | 8,750 | $ | 2,987 | $ | 1,924 | $ | 654 | $ | 1,098 | $ | 1,108 | $ | 472 | $ | 29 | $ | 239 | $ | 17,261 | |||||||||||||||||||||
Charge-offs | (1,684 | ) | (820 | ) | (383 | ) | - | (46 | ) | (382 | ) | (578 | ) | - | - | (3,893 | ) | ||||||||||||||||||||||||
Recoveries | 600 | 297 | 17 | - | 158 | 29 | 74 | - | - | 1,175 | |||||||||||||||||||||||||||||||
(Credit) provision | (2,168 | ) | (148 | ) | 1,448 | (252 | ) | (737 | ) | 468 | 587 | (14 | ) | (56 | ) | (872 | ) | ||||||||||||||||||||||||
Ending balance | $ | 5,498 | $ | 2,316 | $ | 3,006 | $ | 402 | $ | 473 | $ | 1,223 | $ | 555 | $ | 15 | $ | 183 | $ | 13,671 | |||||||||||||||||||||
Ending balance: related to loans individually evaluated for impairment | $ | 331 | $ | - | $ | 452 | $ | - | $ | 19 | $ | 60 | $ | 24 | $ | - | $ | - | $ | 886 | |||||||||||||||||||||
Ending balance: related to loans collectively evaluated for impairment | $ | 5,167 | $ | 2,316 | $ | 2,554 | $ | 402 | $ | 454 | $ | 1,163 | $ | 531 | $ | 15 | $ | 183 | $ | 12,785 | |||||||||||||||||||||
LHFI | |||||||||||||||||||||||||||||||||||||||||
Ending balance | $ | 148,293 | $ | 45,261 | $ | 79,589 | $ | 11,737 | $ | 25,535 | $ | 42,524 | $ | 12,716 | $ | 826 | $ | - | $ | 366,481 | |||||||||||||||||||||
Ending balance: individually evaluated for impairment | $ | 5,325 | $ | 3,907 | $ | 8,049 | $ | - | $ | 632 | $ | 139 | $ | 454 | $ | - | $ | - | $ | 18,506 | |||||||||||||||||||||
Ending balance: collectively evaluated for impairment | $ | 142,968 | $ | 41,354 | $ | 71,540 | $ | 11,737 | $ | 24,903 | $ | 42,385 | $ | 12,262 | $ | 826 | $ | - | $ | 347,975 | |||||||||||||||||||||
Allowance for Loan and Leases Losses and Loans Held for Investment | |||||||||||||||||||||||||||||||||||||||||
For the year ended December 31, 2012 | |||||||||||||||||||||||||||||||||||||||||
(In thousands) | Commercial real estate | Construction and land development | Commercial & industrial | Multi-family | Residential | Leases | Tax | Consumer | Unallocated | Total | |||||||||||||||||||||||||||||||
real estate | certificates | ||||||||||||||||||||||||||||||||||||||||
Allowance for Loan and Leases Losses | |||||||||||||||||||||||||||||||||||||||||
Beginning balance | $ | 7,744 | $ | 2,523 | $ | 2,331 | $ | 531 | $ | 1,188 | $ | 1,311 | $ | 425 | $ | 20 | $ | 307 | $ | 16,380 | |||||||||||||||||||||
Charge-offs | (1,313 | ) | (2,452 | ) | (586 | ) | (542 | ) | (111 | ) | (465 | ) | (802 | ) | - | - | (6,271 | ) | |||||||||||||||||||||||
Recoveries | 3 | 816 | 67 | - | 208 | 32 | 29 | - | - | 1,155 | |||||||||||||||||||||||||||||||
Provision (credit) | 2,316 | 2,100 | 112 | 665 | (187 | ) | 230 | 820 | 9 | (68 | ) | 5,997 | |||||||||||||||||||||||||||||
Ending balance | $ | 8,750 | $ | 2,987 | $ | 1,924 | $ | 654 | $ | 1,098 | $ | 1,108 | $ | 472 | $ | 29 | $ | 239 | $ | 17,261 | |||||||||||||||||||||
Ending balance: related to loans individually evaluated for impairment | $ | 835 | $ | 820 | $ | 255 | $ | - | $ | 14 | $ | 55 | $ | 47 | $ | - | $ | - | $ | 2,026 | |||||||||||||||||||||
Ending balance: related to loans collectively evaluated for impairment | $ | 7,915 | $ | 2,167 | $ | 1,669 | $ | 654 | $ | 1,084 | $ | 1,053 | $ | 425 | $ | 29 | $ | 239 | $ | 15,235 | |||||||||||||||||||||
LHFI | |||||||||||||||||||||||||||||||||||||||||
Ending balance | $ | 167,115 | $ | 37,215 | $ | 40,560 | $ | 11,756 | $ | 24,981 | $ | 37,347 | $ | 24,569 | $ | 1,139 | $ | - | $ | 344,682 | |||||||||||||||||||||
Ending balance: individually evaluated for impairment | $ | 10,958 | $ | 5,943 | $ | 10,251 | $ | - | $ | 994 | $ | 81 | $ | 601 | $ | - | $ | - | $ | 28,828 | |||||||||||||||||||||
Ending balance: collectively evaluated for impairment | $ | 156,157 | $ | 31,272 | $ | 30,309 | $ | 11,756 | $ | 23,987 | $ | 37,266 | $ | 23,968 | $ | 1,139 | $ | - | $ | 315,854 | |||||||||||||||||||||
Financing receivable evaluated for impairment by portfolio segment | ' | ||||||||||||||||||||||||||||||||||||||||
The following tables detail the impaired LHFI by loan segment. | |||||||||||||||||||||||||||||||||||||||||
As of December 31, 2013 | |||||||||||||||||||||||||||||||||||||||||
(In thousands) | Unpaid | Recorded | Related | Average | Interest | ||||||||||||||||||||||||||||||||||||
principal | investment | allowance | recorded investment | income | |||||||||||||||||||||||||||||||||||||
balance | recognized | ||||||||||||||||||||||||||||||||||||||||
With no related allowance recorded: | |||||||||||||||||||||||||||||||||||||||||
Commercial real estate | $ | 4,429 | $ | 4,158 | $ | - | $ | 7,956 | $ | 73 | |||||||||||||||||||||||||||||||
Construction and land development | 9,850 | 3,907 | - | 3,933 | 209 | ||||||||||||||||||||||||||||||||||||
Commercial and industrial | 6,693 | 6,491 | - | 5,960 | 250 | ||||||||||||||||||||||||||||||||||||
Residential real estate | - | - | - | 84 | 27 | ||||||||||||||||||||||||||||||||||||
Tax certificates | 179 | 115 | - | 167 | - | ||||||||||||||||||||||||||||||||||||
Total: | $ | 21,151 | $ | 14,671 | $ | - | $ | 18,100 | $ | 559 | |||||||||||||||||||||||||||||||
With an allowance recorded: | |||||||||||||||||||||||||||||||||||||||||
Commercial real estate | $ | 1,435 | $ | 1,435 | $ | 331 | $ | 1,879 | $ | - | |||||||||||||||||||||||||||||||
Construction and land development | - | - | - | 381 | - | ||||||||||||||||||||||||||||||||||||
Commercial and industrial | 2,592 | 1,290 | 452 | 2,456 | - | ||||||||||||||||||||||||||||||||||||
Residential real estate | 827 | 631 | 19 | 492 | - | ||||||||||||||||||||||||||||||||||||
Leases | 139 | 139 | 60 | 106 | - | ||||||||||||||||||||||||||||||||||||
Tax certificates | 4,322 | 340 | 24 | 341 | - | ||||||||||||||||||||||||||||||||||||
Total: | $ | 9,315 | $ | 3,835 | $ | 886 | $ | 5,655 | $ | - | |||||||||||||||||||||||||||||||
As of December 31, 2012 | |||||||||||||||||||||||||||||||||||||||||
(In thousands) | Unpaid | Recorded | Related | Average | Interest | ||||||||||||||||||||||||||||||||||||
principal | investment | allowance | recorded | income | |||||||||||||||||||||||||||||||||||||
balance | investment | recognized | |||||||||||||||||||||||||||||||||||||||
With no related allowance recorded: | |||||||||||||||||||||||||||||||||||||||||
Commercial real estate | $ | 10,417 | $ | 8,623 | $ | - | $ | 11,163 | $ | 78 | |||||||||||||||||||||||||||||||
Construction and land development | 6,250 | 3,464 | - | 10,059 | 187 | ||||||||||||||||||||||||||||||||||||
Commercial and industrial | 7,790 | 6,820 | - | 5,545 | 73 | ||||||||||||||||||||||||||||||||||||
Multi-family | - | - | - | 780 | - | ||||||||||||||||||||||||||||||||||||
Residential real estate | 572 | 516 | - | 490 | 21 | ||||||||||||||||||||||||||||||||||||
Tax certificates | - | - | - | 583 | - | ||||||||||||||||||||||||||||||||||||
Total: | $ | 25,029 | $ | 19,423 | $ | - | $ | 28,620 | $ | 359 | |||||||||||||||||||||||||||||||
With an allowance recorded: | |||||||||||||||||||||||||||||||||||||||||
Commercial real estate | $ | 4,136 | $ | 2,335 | $ | 835 | $ | 1,526 | $ | - | |||||||||||||||||||||||||||||||
Construction and land development | 6,180 | 2,479 | 820 | 923 | - | ||||||||||||||||||||||||||||||||||||
Commercial and industrial | 9,585 | 3,431 | 255 | 682 | - | ||||||||||||||||||||||||||||||||||||
Multi-family | - | - | - | 383 | - | ||||||||||||||||||||||||||||||||||||
Residential real estate | 685 | 478 | 14 | 714 | 7 | ||||||||||||||||||||||||||||||||||||
Leases | 81 | 81 | 55 | 86 | - | ||||||||||||||||||||||||||||||||||||
Tax certificates | 4,408 | 601 | 47 | 288 | - | ||||||||||||||||||||||||||||||||||||
Total: | $ | 25,075 | $ | 9,405 | $ | 2,026 | $ | 4,602 | $ | 7 | |||||||||||||||||||||||||||||||
OTHER_REAL_ESTATE_OWNED_Tables
OTHER REAL ESTATE OWNED (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
OTHER REAL ESTATE OWNED [Abstract] | ' | ||||||||||||
Details of changes in other real estate owned | ' | ||||||||||||
Set forth below is a table which details the changes in OREO from December 31, 2012 to December 31, 2013. | |||||||||||||
For the year ended December 31, 2013 | |||||||||||||
(In thousands) | Loans | Tax Liens | Total | ||||||||||
Beginning balance | $ | 11,365 | $ | 2,070 | $ | 13,435 | |||||||
Net proceeds from sales | (8,869 | ) | (3,910 | ) | (12,779 | ) | |||||||
Net gain on sales | 228 | 1,199 | 1,427 | ||||||||||
Assets acquired on non-accrual loans | 100 | 8,951 | 9,051 | ||||||||||
Impairment charge | (1,099 | ) | (418 | ) | (1,517 | ) | |||||||
Ending balance | $ | 1,725 | $ | 7,892 | $ | 9,617 |
PREMISES_AND_EQUIPMENT_Tables
PREMISES AND EQUIPMENT (Tables) | 12 Months Ended | |||||||||
Dec. 31, 2013 | ||||||||||
PREMISES AND EQUIPMENT [Abstract] | ' | |||||||||
Premises and Equipment | ' | |||||||||
As of December 31, | ||||||||||
(In thousands) | Estimated Useful Lives | 2013 | 2012 | |||||||
Land | $ | 2,200 | $ | 2,396 | ||||||
Buildings and leasehold improvements | 5 - 39 years | 6,225 | 7,554 | |||||||
Furniture, fixtures and equipment | 3 - 7 years | 7,006 | 6,667 | |||||||
15,431 | 16,617 | |||||||||
Less accumulated depreciation and amortization | (10,956 | ) | (11,385 | ) | ||||||
Premises and equipment, net | $ | 4,475 | $ | 5,232 |
LEASE_COMMITMENTS_Tables
LEASE COMMITMENTS (Tables) | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
LEASE COMMITMENTS [Abstract] | ' | ||||
Minimum rental commitments | ' | ||||
The Company leases various premises under operating lease agreements, which expire through 2024 and require minimum annual rentals. Some of these leases are cancelable. The approximate minimum rental commitments under the leases are as follows for the year ended December 31, 2013: | |||||
As of | |||||
(In thousands) | 31-Dec-13 | ||||
2014 | $ | 858 | |||
2015 | 874 | ||||
2016 | 886 | ||||
2017 | 860 | ||||
2018 | 818 | ||||
Thereafter | 2,070 | ||||
Total lease commitments | $ | 6,366 |
DEPOSITS_Tables
DEPOSITS (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
DEPOSITS [Abstract] | ' | ||||||||
Deposits summary | ' | ||||||||
Deposits are summarized as follows: | |||||||||
As of December 31, | |||||||||
(In thousands) | 2013 | 2012 | |||||||
Demand | $ | 60,473 | $ | 58,531 | |||||
NOW | 45,375 | 43,920 | |||||||
Money Market | 164,678 | 179,359 | |||||||
Savings | 17,593 | 17,472 | |||||||
Time deposits (over $100) | 92,763 | 91,233 | |||||||
Time deposits (under $100) | 148,082 | 164,402 | |||||||
Total deposits | $ | 528,964 | $ | 554,917 | |||||
Maturities of time deposits for the next five years and thereafter | ' | ||||||||
Maturities of time deposits for the next five years and thereafter are as follows: | |||||||||
As of | |||||||||
(In thousands) | 31-Dec-13 | ||||||||
2014 | $ | 117,181 | |||||||
2015 | 88,948 | ||||||||
2016 | 11,997 | ||||||||
2017 | 5,373 | ||||||||
2018 | 3,204 | ||||||||
Thereafter | 14,142 | ||||||||
Total certificates of deposit | $ | 240,845 |
BORROWINGS_AND_SUBORDINATED_DE1
BORROWINGS AND SUBORDINATED DEBENTURES (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
BORROWINGS AND SUBORDINATED DEBENTURES [Abstract] | ' | ||||||||||||||||
FHLB borrowings allocated by the year in which they mature with their corresponding weighted average rates | ' | ||||||||||||||||
Presented below are the Company’s FHLB borrowings allocated by the year in which they mature with their corresponding weighted average rates: | |||||||||||||||||
As of December 31, | |||||||||||||||||
(Dollars in thousands) | 2013 | 2012 | |||||||||||||||
Amount | Rate | Amount | Rate | ||||||||||||||
Advances maturing in | |||||||||||||||||
2013 | $ | - | - | $ | 50,000 | 2.64 | % | ||||||||||
2014 | 10,000 | 0.24 | % | ||||||||||||||
2015 | 10,000 | 0.71 | % | - | - | ||||||||||||
2016 | 10,000 | 1.11 | % | - | - | ||||||||||||
2017 | 25,000 | 1.46 | % | 15,000 | 1.39 | % | |||||||||||
2018 | 10,000 | 2.01 | % | ||||||||||||||
Total FHLB borrowings | $ | 65,000 | $ | 65,000 |
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
INCOME TAXES [Abstract] | ' | ||||||||
Schedule of Components of Income Tax Expense | ' | ||||||||
The components of income tax expense are stated below: | |||||||||
For the years ended December 31, | |||||||||
(In thousands) | 2013 | 2012 | |||||||
Income tax expense | |||||||||
Current | $ | 42 | $ | - | |||||
Deferred | - | - | |||||||
Income tax expense | $ | 42 | $ | - | |||||
Statutory Federal Income Tax Rate Reconciliation | ' | ||||||||
The difference between the applicable income tax expense and the amount computed by applying the statutory federal income tax rate of 34% in 2013 and 2012 is as follows: | |||||||||
For the years ended December 31, | |||||||||
(In thousands) | 2013 | 2012 | |||||||
Computed tax expense (benefit) at statutory rate | $ | 731 | $ | (5,313 | ) | ||||
Tax-exempt income | (22 | ) | (42 | ) | |||||
Department of Justice fine | - | 680 | |||||||
Nondeductible expense | 21 | 29 | |||||||
Bank owned life insurance | (183 | ) | (188 | ) | |||||
Adjustment to prior year items | 1,933 | - | |||||||
(Decrease) increase in valuation allowance | (2,438 | ) | 4,834 | ||||||
Applicable income tax expense | $ | 42 | $ | - | |||||
Deferred Tax Assets and Liabilities | ' | ||||||||
Deferred tax assets and liabilities consist of the following: | |||||||||
As of December 31, | |||||||||
(In thousands) | 2013 | 2012 | |||||||
Deferred tax assets | |||||||||
Allowance for loan and lease losses | $ | 4,648 | $ | 5,863 | |||||
Net operating loss carry forward | 18,908 | 21,988 | |||||||
Asset valuation reserves | 34 | 79 | |||||||
Escrow settlement reserves | 561 | - | |||||||
Security writedowns | 2,193 | 1,429 | |||||||
OREO writedowns | 1,490 | 4,475 | |||||||
Investment in partnerships | 1,805 | 34 | |||||||
Pension obligations | 4,926 | 5,745 | |||||||
Unrealized losses on debt securities | 2,171 | - | |||||||
Accrued stock-based compensation | 143 | 804 | |||||||
Non-accrual interest | 134 | 277 | |||||||
Capital loss carryovers | 2,892 | 1,550 | |||||||
Charitable contribution carryovers | 14 | 11 | |||||||
Other | 77 | 139 | |||||||
Deferred tax assets before valuation allowance | 39,996 | 42,394 | |||||||
Less valuation allowance | (37,159 | ) | (39,597 | ) | |||||
Total deferred tax assets | 2,837 | 2,797 | |||||||
Deferred tax liabilities | |||||||||
Penalties on delinquent tax certificates | 39 | 224 | |||||||
Unrealized gains on AFS debt investment securities | - | 1,665 | |||||||
Unrealized gains on AFS equity securities | 429 | 145 | |||||||
Prepaid deductions | 190 | 285 | |||||||
Other | 8 | 64 | |||||||
Total deferred tax liabilities | 666 | 2,383 | |||||||
Net deferred tax assets, included in other assets | $ | 2,171 | $ | 414 | |||||
FINANCIAL_INSTRUMENTS_WITH_OFF1
FINANCIAL INSTRUMENTS WITH OFF-BALANCE-SHEET RISK AND CONCENTRATIONS OF CREDIT RISK (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
FINANCIAL INSTRUMENTS WITH OFF-BALANCE-SHEET RISK AND CONCENTRATIONS OF CREDIT RISK [Abstract] | ' | ||||||||
Financial instruments whose contract amounts represent credit risk | ' | ||||||||
The contract amounts are as follows: | |||||||||
As of December 31, | |||||||||
(In thousands) | 2013 | 2012 | |||||||
Financial instruments whose contract amounts represent credit risk | |||||||||
Open-end lines of credit | $ | 21,182 | $ | 20,515 | |||||
Commitments to extend credit | 200 | 24,030 | |||||||
Standby letters of credit and financial guarantees written | 2,679 | 1,199 |
REGULATORY_CAPITAL_REQUIREMENT1
REGULATORY CAPITAL REQUIREMENTS (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||
REGULATORY CAPITAL REQUIREMENTS [Abstract] | ' | ||||||||||||||||||||||||
Royal Bank's capital ratios | ' | ||||||||||||||||||||||||
The table below sets forth Royal Bank’s capital ratios under RAP based on the FDIC’s interpretation of the Call Report instructions: | |||||||||||||||||||||||||
To be well capitalized | |||||||||||||||||||||||||
For capital | capitalized under prompt | ||||||||||||||||||||||||
Actual | adequacy purposes | corrective action provision | |||||||||||||||||||||||
(Dollars in thousands) | Amount | Ratio | Amount | Ratio | Amount | Ratio | |||||||||||||||||||
Total capital (to risk-weighted assets) | |||||||||||||||||||||||||
At December 31, 2013 | $ | 71,417 | 15.61 | % | $ | 36,590 | 8 | % | $ | 45,737 | 10 | % | |||||||||||||
At December 31, 2012 | $ | 67,338 | 15.22 | % | $ | 35,386 | 8 | % | $ | 44,233 | 10 | % | |||||||||||||
Tier I capital (to risk-weighted assets) | |||||||||||||||||||||||||
At December 31, 2013 | $ | 65,602 | 14.34 | % | $ | 18,295 | 4 | % | $ | 27,442 | 6 | % | |||||||||||||
At December 31, 2012 | $ | 61,664 | 13.94 | % | $ | 17,693 | 4 | % | $ | 26,540 | 6 | % | |||||||||||||
Tier I capital (to average assets, leverage) | |||||||||||||||||||||||||
At December 31, 2013 | $ | 65,602 | 9.13 | % | $ | 28,739 | 4 | % | $ | 35,924 | 5 | % | |||||||||||||
At December 31, 2012 | $ | 61,664 | 8 | % | $ | 30,842 | 4 | % | $ | 38,552 | 5 | % | |||||||||||||
Adjustments to net loss as well as the capital ratios | ' | ||||||||||||||||||||||||
The tables below reflect the adjustments to the net loss as well as the capital ratios for Royal Bank under U.S. GAAP: | |||||||||||||||||||||||||
For the years ended December 31, | |||||||||||||||||||||||||
(In thousands) | 2013 | 2012 | |||||||||||||||||||||||
RAP net loss | $ | (139 | ) | $ | (17,974 | ) | |||||||||||||||||||
Tax lien adjustment, net of noncontrolling interest | 2,844 | 4,731 | |||||||||||||||||||||||
U.S. GAAP net income (loss) | $ | 2,705 | $ | (13,243 | ) | ||||||||||||||||||||
At December 31, 2013 | At December 31, 2012 | ||||||||||||||||||||||||
As reported | As adjusted | As reported | As adjusted | ||||||||||||||||||||||
under RAP | for U.S. GAAP | under RAP | for U.S. GAAP | ||||||||||||||||||||||
Total capital (to risk-weighted assets) | 15.61 | % | 16.49 | % | 15.22 | % | 16.73 | % | |||||||||||||||||
Tier I capital (to risk-weighted assets) | 14.34 | % | 15.22 | % | 13.94 | % | 15.44 | % | |||||||||||||||||
Tier I capital (to average assets, leverage) | 9.13 | % | 9.73 | % | 8 | % | 8.93 | % | |||||||||||||||||
Company capital ratios | ' | ||||||||||||||||||||||||
The tables below reflect the Company’s capital ratios: | |||||||||||||||||||||||||
To be well capitalized | |||||||||||||||||||||||||
For capital | capitalized under prompt | ||||||||||||||||||||||||
Actual | adequacy purposes | corrective action provision | |||||||||||||||||||||||
(Dollars in thousands) | Amount | Ratio | Amount | Ratio | Amount | Ratio | |||||||||||||||||||
Total capital (to risk-weighted assets) | |||||||||||||||||||||||||
At December 31, 2013 | $ | 84,384 | 18.09 | % | $ | 37,315 | 8 | % | N/A | N/A | |||||||||||||||
At December 31, 2012 | $ | 84,073 | 18.46 | % | $ | 36,429 | 8 | % | N/A | N/A | |||||||||||||||
Tier I capital (to risk-weighted assets) | |||||||||||||||||||||||||
At December 31, 2013 | $ | 71,432 | 15.31 | % | $ | 18,658 | 4 | % | N/A | N/A | |||||||||||||||
At December 31, 2012 | $ | 71,138 | 15.62 | % | $ | 18,214 | 4 | % | N/A | N/A | |||||||||||||||
Tier I Capital (to average assets, leverage) | |||||||||||||||||||||||||
At December 31, 2013 | $ | 71,432 | 9.79 | % | $ | 29,178 | 4 | % | N/A | N/A | |||||||||||||||
At December 31, 2012 | $ | 71,138 | 9.05 | % | $ | 31,443 | 4 | % | N/A | N/A | |||||||||||||||
Adjustment to Company's capital ratio under RAP | ' | ||||||||||||||||||||||||
The Company has filed the Consolidated Financial Statements for Bank Holding Companies-FR Y-9C (“FR Y-9C”) as of December 31, 2013 consistent with U.S. GAAP and the FR Y-9C instructions. In the event a similar adjustment for RAP purposes would be required by the Federal Reserve on the holding company level, the adjusted ratios are shown in the tables below. | |||||||||||||||||||||||||
For the years ended December 31, | |||||||||||||||||||||||||
(In thousands) | 2013 | 2012 | |||||||||||||||||||||||
U.S. GAAP net income (loss) | $ | 2,109 | $ | (15,625 | ) | ||||||||||||||||||||
Tax lien adjustment, net of noncontrolling interest | (2,844 | ) | (4,731 | ) | |||||||||||||||||||||
RAP net loss | $ | (735 | ) | $ | (20,356 | ) | |||||||||||||||||||
At December 31, 2013 | At December 31, 2012 | ||||||||||||||||||||||||
As reported | As adjusted | As reported | As adjusted | ||||||||||||||||||||||
under U.S. GAAP | for RAP | under U.S. GAAP | for RAP | ||||||||||||||||||||||
Total capital (to risk-weighted assets) | 18.09 | % | 17.24 | % | 18.46 | % | 17.01 | % | |||||||||||||||||
Tier I capital (to risk-weighted assets) | 15.31 | % | 14.1 | % | 15.62 | % | 13.55 | % | |||||||||||||||||
Tier I capital (to average assets, leverage) | 9.79 | % | 8.98 | % | 9.05 | % | 7.79 | % | |||||||||||||||||
PENSION_PLANS_Tables
PENSION PLANS (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
PENSION PLANS [Abstract] | ' | ||||||||
Plan's Funded Status and Amounts Recognized in the consolidated Balance Sheets | ' | ||||||||
The following table sets forth the plan’s funded status and amounts recognized in the Company’s consolidated balance sheets: | |||||||||
For the years ended December 31, | |||||||||
(In thousands) | 2013 | 2012 | |||||||
Change in benefit obligation | |||||||||
Benefit obligation at beginning of year | $ | 16,897 | $ | 14,942 | |||||
Service cost | 81 | 272 | |||||||
Interest cost | 623 | 584 | |||||||
Benefits paid | (981 | ) | (556 | ) | |||||
Actuarial (gain) loss | (2,132 | ) | 1,655 | ||||||
Benefits obligation at end of year | $ | 14,488 | $ | 16,897 | |||||
Unrecognized prior service cost | 179 | 269 | |||||||
Unrecognized actuarial loss | 2,750 | 5,119 | |||||||
$ | 2,929 | $ | 5,388 | ||||||
Assumptions Used to Determine the Benefit Obligations and the Net Periodic Pension Cost | ' | ||||||||
The table below reflects the assumptions used to determine the benefit obligations: | |||||||||
As of December 31, | |||||||||
2013 | 2012 | ||||||||
Discount rate | 4.37 | % | 3.25 | % | |||||
Rate of compensation increase | 4 | % | 4 | % | |||||
The table below reflects the assumptions used to determine the net periodic pension cost: | |||||||||
For the years ended December 31, | |||||||||
2013 | 2012 | ||||||||
Discount rate | 4.37 | % | 4 | % | |||||
Rate of compensation increase | 4 | % | 4 | % | |||||
Components of Net Pension Cost | ' | ||||||||
Net pension cost included the following components: | |||||||||
For the years ended December 31, | |||||||||
(In thousands) | 2013 | 2012 | |||||||
Service cost | $ | 81 | $ | 272 | |||||
Interest cost | 623 | 584 | |||||||
Amortization prior service cost | 90 | 90 | |||||||
Amortization net actuarial loss | 238 | 381 | |||||||
Net periodic benefit cost | $ | 1,032 | $ | 1,327 | |||||
Benefit Payments to be Made From the Non-qualified Pension Plan | ' | ||||||||
Benefit payments to be made from the Non-qualified Pension Plan are as follows: | |||||||||
As of December 31, 2013 | |||||||||
Non-Qualified | |||||||||
(In thousands) | Pension Plans | ||||||||
2014 | $ | 970 | |||||||
2015 | 987 | ||||||||
2016 | 1,015 | ||||||||
2017 | 1,015 | ||||||||
2018 | 1,015 | ||||||||
Next five years thereafter | 5,610 |
STOCK_COMPENSATION_PLANS_Table
STOCK COMPENSATION PLANS (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||
Share-based Payment Award [Line Items] | ' | ||||||||||||||||||||||||
Detail for Non-vested Shares Under the Plans | ' | ||||||||||||||||||||||||
The following table provides detail for non-vested shares under the Long-Term Incentive Plan as of December 31, 2013: | |||||||||||||||||||||||||
Weighted | |||||||||||||||||||||||||
Average | |||||||||||||||||||||||||
Number | Exercise | ||||||||||||||||||||||||
of shares | Price | ||||||||||||||||||||||||
Non-vested options December 31, 2012 | 10,520 | $ | 4.5 | ||||||||||||||||||||||
Granted | 15,000 | 1.36 | |||||||||||||||||||||||
Forfeited | (1,590 | ) | 4.5 | ||||||||||||||||||||||
Vested | (8,930 | ) | 4.5 | ||||||||||||||||||||||
Non-vested options December 31, 2013 | 15,000 | $ | 1.36 | ||||||||||||||||||||||
Outside Director's Stock Option Plan [Member] | ' | ||||||||||||||||||||||||
Share-based Payment Award [Line Items] | ' | ||||||||||||||||||||||||
Summary of the Status of the Plan | ' | ||||||||||||||||||||||||
A summary of the Directors’ Plan activity is presented below: | |||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||
Weighted | Weighted | -1 | Weighted | ||||||||||||||||||||||
Average | Average | Average | Average | ||||||||||||||||||||||
Exercise | Remaining | Intrinsic | Exercise | ||||||||||||||||||||||
Options | Price | Term (yrs) | Value | Options | Price | ||||||||||||||||||||
Options outstanding at beginning of year | 58,306 | $ | 21.15 | 1.2 | 68,620 | $ | 20.66 | ||||||||||||||||||
Exercised | - | - | - | - | |||||||||||||||||||||
Forfeited | (24,286 | ) | 21.24 | - | - | ||||||||||||||||||||
Expired | (8,350 | ) | 18.27 | (10,314 | ) | 17.91 | |||||||||||||||||||
Options outstanding at the end of the year | 25,670 | $ | 22 | 1.5 | $ | - | 58,306 | $ | 21.15 | ||||||||||||||||
Options exercisable at the end of the year | 25,670 | $ | 22 | 1.5 | $ | - | 58,306 | $ | 21.15 | ||||||||||||||||
(1) The aggregate intrinsic value of a stock option in the table above represents the total pre-tax intrinsic value (the amount by which the current market value of the underlying stock exceeds the exercise price of the option) that would have been received by the option holders had they exercised their options on December 31, 2013. The intrinsic value varies based on the changes in the market value in the Company’s stock. Because the exercise price exceeded the market value of the options, the average intrinsic value was $0 at December 31, 2013. | |||||||||||||||||||||||||
Information Pertaining to Options Outstanding | ' | ||||||||||||||||||||||||
Information pertaining to options outstanding at December 31, 2013 is as follows: | |||||||||||||||||||||||||
Options outstanding and exercisable | |||||||||||||||||||||||||
Weighted | Weighted | ||||||||||||||||||||||||
Average | Average | ||||||||||||||||||||||||
Range of | Number | Exercise | Remaining | ||||||||||||||||||||||
exercise prices | Outstanding | Price | Term (yrs) | ||||||||||||||||||||||
$21.00 - $23.00 | 25,670 | $ | 22 | 1.5 | |||||||||||||||||||||
25,670 | $ | 22 | 1.5 | ||||||||||||||||||||||
Employee Stock Option Plan And Appreciation Right Plan [Member] | ' | ||||||||||||||||||||||||
Share-based Payment Award [Line Items] | ' | ||||||||||||||||||||||||
Summary of the Status of the Plan | ' | ||||||||||||||||||||||||
A summary of the Plan activity is presented below: | |||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||
Weighted | Weighted | -1 | Weighted | ||||||||||||||||||||||
Average | Average | Average | Average | ||||||||||||||||||||||
Exercise | Remaining | Intrinsic | Exercise | ||||||||||||||||||||||
Options | Price | Term (yrs) | Value | Options | Price | ||||||||||||||||||||
Options outstanding at beginning of year | 217,561 | $ | 21.5 | 1.3 | 335,919 | $ | 21.01 | ||||||||||||||||||
Exercised | - | - | - | - | |||||||||||||||||||||
Forfeited | (119,137 | ) | 21.53 | (74,569 | ) | 21.42 | |||||||||||||||||||
Expired | (15,644 | ) | 18.27 | (43,789 | ) | 17.91 | |||||||||||||||||||
Options outstanding at the end of the year | 82,780 | $ | 22.06 | 1.1 | $ | - | 217,561 | $ | 21.5 | ||||||||||||||||
Options exercisable at the end of the year | 82,780 | $ | 22.06 | 1.1 | $ | - | 217,561 | $ | 21.5 | ||||||||||||||||
(1) The aggregate intrinsic value of a stock option in the table above represents the total pre-tax intrinsic value (the amount by which the current market value of the underlying stock exceeds the exercise price of the option) that would have been received by the option holders had they exercised their options on December 31, 2013. The intrinsic value varies based on the changes in the market value in the Company’s stock. Because the exercise price exceeded the market value of the options, the average intrinsic value was $0 at December 31, 2013. | |||||||||||||||||||||||||
Information Pertaining to Options Outstanding | ' | ||||||||||||||||||||||||
Information pertaining to options outstanding at December 31, 2013 is as follows: | |||||||||||||||||||||||||
Options outstanding and exercisable | |||||||||||||||||||||||||
Weighted | Weighted | ||||||||||||||||||||||||
Average | Average | ||||||||||||||||||||||||
Range of | Number | Exercise | Remaining | ||||||||||||||||||||||
exercise prices | Outstanding | Price | Term (yrs) | ||||||||||||||||||||||
$21.00 - $23.00 | 82,780 | $ | 22.06 | 1.1 | |||||||||||||||||||||
82,780 | $ | 22.06 | 1.1 | ||||||||||||||||||||||
Long- Term Incentive Plan [Member] | ' | ||||||||||||||||||||||||
Share-based Payment Award [Line Items] | ' | ||||||||||||||||||||||||
Summary of the Status of the Plan | ' | ||||||||||||||||||||||||
A summary of the status of the unrestricted portion of the Plan is presented below: | |||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||
Weighted | Weighted | -1 | Weighted | ||||||||||||||||||||||
Average | Average | Average | Average | ||||||||||||||||||||||
Exercise | Remaining | Intrinsic | Exercise | ||||||||||||||||||||||
Options | Price | Term (yrs) | Value | Options | Price | ||||||||||||||||||||
Options outstanding at beginning of year | 86,226 | $ | 9.22 | 5.4 | 116,440 | $ | 9.73 | ||||||||||||||||||
Granted | 15,000 | 1.36 | - | - | |||||||||||||||||||||
Exercised | - | - | - | - | |||||||||||||||||||||
Forfeited | (11,840 | ) | 8.83 | (30,214 | ) | 11.19 | |||||||||||||||||||
Expired | - | - | - | - | |||||||||||||||||||||
Options outstanding at the end of the year | 89,386 | $ | 7.95 | 4.9 | $ | - | 86,226 | $ | 9.22 | ||||||||||||||||
Options exercisable at the end of the year | 74,386 | $ | 9.28 | 4 | $ | - | 75,706 | $ | 9.88 | ||||||||||||||||
Weighted-average fair value of options granted during the year | $ | 0.98 | $ | - | $ | - | |||||||||||||||||||
(1) The aggregate intrinsic value of a stock option in the table above represents the total pre-tax intrinsic value (the amount by which the current market value of the underlying stock exceeds the exercise price of the option) that would have been received by the option holders had they exercised their options on December 31, 2013. The intrinsic value varies based on the changes in the market value in the Company’s stock. Because the exercise price exceeded the market value of the options, the average intrinsic value was $0 at December 31, 2013. | |||||||||||||||||||||||||
Information Pertaining to Options Outstanding | ' | ||||||||||||||||||||||||
Information pertaining to options outstanding at December 31, 2013 is as follows: | |||||||||||||||||||||||||
Options issued and outstanding | Options exercisable | ||||||||||||||||||||||||
Weighted | Weighted | Weighted | |||||||||||||||||||||||
Average | Average | Average | |||||||||||||||||||||||
Range of | Number | Exercise | Remaining | Number | Exercise | ||||||||||||||||||||
exercise prices | Outstanding | Price | Term (yrs) | Outstanding | Price | ||||||||||||||||||||
$ | 1.36 | 15,000 | $ | 1.36 | 9.3 | - | $ | - | |||||||||||||||||
$ | 4.5 | 51,550 | 4.5 | 4.3 | 51,550 | 4.5 | |||||||||||||||||||
$ | 20.08 | 22,836 | 20.08 | 3.3 | 22,836 | 20.08 | |||||||||||||||||||
89,386 | $ | 7.95 | 4.9 | 74,386 | $ | 9.28 | |||||||||||||||||||
EARNINGS_PER_COMMON_SHARE_EPS_
EARNINGS PER COMMON SHARE ("EPS") (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
EARNINGS PER COMMON SHARE ("EPS") [Abstract] | ' | ||||||||||||
Schedule of Computation of Basic and Diluted Earning Per Share | ' | ||||||||||||
Basic and diluted EPS are calculated as follows: | |||||||||||||
For the year ended December 31, 2013 | |||||||||||||
Income | Average shares | Per share | |||||||||||
(In thousands, except for per share data) | (numerator) | (denominator) | Amount | ||||||||||
Basic and Diluted EPS | |||||||||||||
Income available to common shareholders | $ | 34 | 13,279 | $ | 0 | ||||||||
For the year ended December 31, 2012 | |||||||||||||
Loss | Average shares | Per share | |||||||||||
(In thousands, except for per share data) | (numerator) | (denominator) | Amount | ||||||||||
Basic and Diluted EPS | |||||||||||||
Loss available to common shareholders | $ | (17,663 | ) | 13,257 | $ | (1.33 | ) |
COMPREHENSIVE_LOSS_Tables
COMPREHENSIVE LOSS (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
COMPREHENSIVE LOSS [Abstract] | ' | ||||||||||||
Components of Other Comprehensive Income (Loss) and Related Tax Effects | ' | ||||||||||||
The components of other comprehensive (loss) income and the related tax effects for December 31, 2013 and 2012 are as follows: | |||||||||||||
For the year ended December 31, 2013 | |||||||||||||
(In thousands) | Before tax | Tax | Net of tax | ||||||||||
amount | expense | amount | |||||||||||
(benefit) | |||||||||||||
Unrealized losses on investment securities: | |||||||||||||
Unrealized holding losses arising during period | $ | (10,291 | ) | $ | (3,572 | ) | $ | (6,719 | ) | ||||
Less reclassification adjustment for gains realized in net income | 158 | 54 | 104 | ||||||||||
Unrealized losses on investment securities | (10,449 | ) | (3,626 | ) | (6,823 | ) | |||||||
Unrecognized benefit obligation expense: | |||||||||||||
Actuarial gain | 950 | 323 | 627 | ||||||||||
Less reclassification adjustment for amortization | (328 | ) | (112 | ) | (216 | ) | |||||||
1,278 | 435 | 843 | |||||||||||
Other comprehensive loss, net | $ | (9,171 | ) | $ | (3,191 | ) | $ | (5,980 | ) | ||||
For the year ended December 31, 2012 | |||||||||||||
(In thousands) | Before tax | Tax | Net of tax | ||||||||||
amount | expense | amount | |||||||||||
(benefit) | |||||||||||||
Unrealized losses on investment securities: | |||||||||||||
Unrealized holding losses arising during period | $ | (1,573 | ) | $ | (535 | ) | $ | (1,038 | ) | ||||
Less adjustment for impaired investments | (2,359 | ) | (802 | ) | (1,557 | ) | |||||||
Less reclassification adjustment for gains realized in net loss | 1,030 | 350 | 680 | ||||||||||
Unrealized losses on investment securities | (244 | ) | (83 | ) | (161 | ) | |||||||
Unrecognized benefit obligation expense: | |||||||||||||
Actuarial loss | (1,655 | ) | (563 | ) | (1,092 | ) | |||||||
Less reclassification adjustment for amortization | (471 | ) | (160 | ) | (311 | ) | |||||||
(1,184 | ) | (403 | ) | (781 | ) | ||||||||
Other comprehensive loss, net | $ | (1,428 | ) | $ | (486 | ) | $ | (942 | ) | ||||
Other Components of Accumulated Comprehensive Income (Loss) in Shareholder's Equity | ' | ||||||||||||
The other components of accumulated other comprehensive loss included in shareholders’ equity at December 31, 2013 and 2012 are as follows: | |||||||||||||
As of December 31, | |||||||||||||
(In thousands) | 2013 | 2012 | |||||||||||
Unrecognized benefit obligation | $ | (2,929 | ) | $ | (3,556 | ) | |||||||
Unrealized gains on AFS investments | (3,193 | ) | 3,414 | ||||||||||
Accumulated other comprehensive loss | $ | (6,122 | ) | $ | (142 | ) |
FAIR_VALUE_OF_FINANCIAL_INSTRU1
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
FAIR VALUE OF FINANCIAL INSTRUMENTS [Abstract] | ' | ||||||||||||||||||||
Schedule of Financial Assets Measured at Fair Value on Recurring Basis | ' | ||||||||||||||||||||
For financial assets measured at fair value on a recurring basis, the fair value measurements by level within the fair value hierarchy used at December 31, 2013 and 2012 are as follows: | |||||||||||||||||||||
As of December 31, 2013 | Fair Value Measurements Using | ||||||||||||||||||||
(In thousands) | Level 1 | Level 2 | Level 3 | Fair Value | |||||||||||||||||
Assets | |||||||||||||||||||||
Investment securities available-for-sale | |||||||||||||||||||||
U.S. government agencies | $ | - | $ | 62,036 | $ | - | $ | 62,036 | |||||||||||||
Mortgage-backed securities-residential | - | 32,097 | - | 32,097 | |||||||||||||||||
Collateralized mortgage obligations: | |||||||||||||||||||||
Issued or guaranteed by U.S. government agencies | - | 189,103 | - | 189,103 | |||||||||||||||||
Non-agency | - | 4,479 | - | 4,479 | |||||||||||||||||
Corporate bonds | - | 9,438 | - | 9,438 | |||||||||||||||||
Municipal bonds | - | 6,900 | - | 6,900 | |||||||||||||||||
Other securities | - | - | 4,625 | 4,625 | |||||||||||||||||
Common stocks | 49 | - | - | 49 | |||||||||||||||||
Total available for sale | $ | 49 | $ | 304,053 | $ | 4,625 | $ | 308,727 | |||||||||||||
As of December 31, 2012 | Fair Value Measurements Using | ||||||||||||||||||||
(In thousands) | Level 1 | Level 2 | Level 3 | Fair Value | |||||||||||||||||
Assets | |||||||||||||||||||||
Investment securities available-for-sale | |||||||||||||||||||||
U.S. government agencies | $ | - | $ | 66,444 | $ | - | $ | 66,444 | |||||||||||||
Mortgage-backed securities-residential | - | 30,509 | - | 30,509 | |||||||||||||||||
Collateralized mortgage obligations: | |||||||||||||||||||||
Issued or guaranteed by U.S. government agencies | - | 233,976 | - | 233,976 | |||||||||||||||||
Non-agency | - | 1,011 | - | 1,011 | |||||||||||||||||
Corporate bonds | - | 7,437 | - | 7,437 | |||||||||||||||||
Municipal bonds | - | 5,615 | - | 5,615 | |||||||||||||||||
Other securities | - | - | 4,164 | 4,164 | |||||||||||||||||
Common stocks | 47 | - | - | 47 | |||||||||||||||||
Total available for sale | $ | 47 | $ | 344,992 | $ | 4,164 | $ | 349,203 | |||||||||||||
Additional Information About Assets Measured at Fair Value on a Recurring Basis, Level 3 Inputs | ' | ||||||||||||||||||||
The following tables present additional information about assets measured at fair value on a recurring basis and for which the Company has utilized Level 3 inputs to determine fair value for the years ended December 31, 2013 and 2012: | |||||||||||||||||||||
(In thousands) | Other | ||||||||||||||||||||
Investment Securities Available for Sale | securities | ||||||||||||||||||||
Beginning balance January 1, 2013 | $ | 4,164 | |||||||||||||||||||
Total gains/(losses) - (realized/unrealized): | |||||||||||||||||||||
Included in earnings | 94 | ||||||||||||||||||||
Included in other comprehensive income | 850 | ||||||||||||||||||||
Purchases | 70 | ||||||||||||||||||||
Sales and calls | (553 | ) | |||||||||||||||||||
Transfers in and/or out of Level 3 | - | ||||||||||||||||||||
Ending balance December 31, 2013 | $ | 4,625 | |||||||||||||||||||
Trust | |||||||||||||||||||||
(In thousands) | preferred | Other | |||||||||||||||||||
Investment Securities Available for Sale | securities | securities | Total | ||||||||||||||||||
Beginning balance January 1, 2012 | $ | 12,603 | $ | 6,918 | $ | 19,521 | |||||||||||||||
Total gains/(losses) - (realized/unrealized): | |||||||||||||||||||||
Included in earnings | 126 | (1,817 | ) | (1,691 | ) | ||||||||||||||||
Included in other comprehensive income | (1,938 | ) | 79 | (1,859 | ) | ||||||||||||||||
Purchases | - | 788 | 788 | ||||||||||||||||||
Sales and calls | (10,773 | ) | (1,804 | ) | (12,577 | ) | |||||||||||||||
Amortization of premium | (18 | ) | - | (18 | ) | ||||||||||||||||
Transfers in and/or out of Level 3 | - | - | - | ||||||||||||||||||
Ending balance December 31, 2012 | $ | - | $ | 4,164 | $ | 4,164 | |||||||||||||||
Financial Assets Measured at Fair Value on Nonrecurring Basis | ' | ||||||||||||||||||||
For financial assets measured at fair value on a nonrecurring basis, the fair value measurements by level within the fair value hierarchy used at December 31, 2013 and 2012 are as follows: | |||||||||||||||||||||
As of December 31, 2013 | Fair Value Measurements Using | ||||||||||||||||||||
(In thousands) | Level 1 | Level 2 | Level 3 | Fair Value | |||||||||||||||||
Assets | |||||||||||||||||||||
Impaired loans | $ | - | $ | - | $ | 4,073 | $ | 4,073 | |||||||||||||
Other real estate owned | - | - | 9,182 | 9,182 | |||||||||||||||||
Loans and leases held for sale | - | - | 1,446 | 1,446 | |||||||||||||||||
As of December 31, 2012 | Fair Value Measurements Using | ||||||||||||||||||||
(In thousands) | Level 1 | Level 2 | Level 3 | Fair Value | |||||||||||||||||
Assets | |||||||||||||||||||||
Impaired loans | $ | - | $ | - | $ | 9,180 | $ | 9,180 | |||||||||||||
Other real estate owned | - | - | 7,632 | 7,632 | |||||||||||||||||
Loans and leases held for sale | - | - | 1,572 | 1,572 | |||||||||||||||||
Schedule of quantitative information about assets measured at fair value on nonrecurring basis | ' | ||||||||||||||||||||
The following table presents additional quantitative information about assets measured at fair value on a nonrecurring basis and for which the Company has utilized Level 3 inputs to determine fair value: | |||||||||||||||||||||
Qualitative Information about Level 3 Fair Value Measurements | |||||||||||||||||||||
As of December 31, 2013 | Valuation | Unobservable | Range (Weighted | ||||||||||||||||||
(In thousands) | Fair Value | Techniques | Input | Average) | |||||||||||||||||
Impaired loans and leases | $ | 4,073 | Appraisal of collateral (1) | Appraisal adjustments | 0.0% to -25.0% (-2.0%) | ||||||||||||||||
Liquidation expenses | 0.0% to -23.2% (-6.7%) | ||||||||||||||||||||
Salvageable value of | 0 | % | |||||||||||||||||||
collateral (2) | |||||||||||||||||||||
Other real estate owned | 9,182 | Appraisal of collateral (1) | Appraisal adjustments | 0.0% to -62.5% (-11.2%) | |||||||||||||||||
Sales prices | Liquidation expenses | -2.8% to -6.8% (-5.0%) | |||||||||||||||||||
Loans and leases held for sale | 1,446 | Sales prices (3) | |||||||||||||||||||
-1 | Appraisals or brokers opinions of collateral values may be adjusted for qualitative factors such as interior condition of the property and liquidation expenses. Fair value may also be based on negotiated settlements with the borrower. | ||||||||||||||||||||
-2 | Leases are measured using the salvageable value of the collateral. | ||||||||||||||||||||
-3 | Fair value was based on agreement with specific buyer. | ||||||||||||||||||||
Fair Value by Balance Sheet Grouping Instruments | ' | ||||||||||||||||||||
Fair values for the Company’s off-balance sheet financial instruments (lending commitments and letters of credit) are based on fees currently charged in the market to enter into similar agreements, taking into account, the remaining terms of the agreements and the counterparties’ credit standing. They are not shown in the table because the amounts are immaterial. | |||||||||||||||||||||
Fair Value Measurements | |||||||||||||||||||||
At December 31, 2013 | |||||||||||||||||||||
Quoted Prices | |||||||||||||||||||||
in Active | Significant | ||||||||||||||||||||
Markets for | Other | Significant | |||||||||||||||||||
Identical | Observable | Unobservable | |||||||||||||||||||
Carrying | Estimated | Assets | Inputs | Inputs | |||||||||||||||||
(In thousands) | amount | fair value | Level 1 | Level 2 | Level 3 | ||||||||||||||||
Financial Assets: | |||||||||||||||||||||
Cash and cash equivalents | $ | 16,844 | $ | 16,844 | $ | 16,844 | $ | - | $ | - | |||||||||||
AFS investment securities | 308,727 | 308,727 | 49 | 304,053 | 4,625 | ||||||||||||||||
Other investment | 2,250 | 2,250 | - | - | 2,250 | ||||||||||||||||
Federal Home Loan Bank stock | 4,204 | 4,204 | - | - | 4,204 | ||||||||||||||||
Loans held for sale | 1,446 | 1,446 | - | - | 1,446 | ||||||||||||||||
Loans, net | 352,810 | 349,336 | - | - | 349,336 | ||||||||||||||||
Accrued interest receivable | 7,054 | 7,054 | - | 7,054 | - | ||||||||||||||||
Financial Liabilities: | |||||||||||||||||||||
Demand deposits | 60,473 | 60,473 | - | 60,473 | - | ||||||||||||||||
NOW and money markets | 210,053 | 210,053 | - | 210,053 | - | ||||||||||||||||
Savings | 17,593 | 17,593 | - | 17,593 | - | ||||||||||||||||
Time deposits | 240,845 | 239,102 | - | 239,102 | - | ||||||||||||||||
Short-term borrowings | 10,000 | 10,000 | 10,000 | - | - | ||||||||||||||||
Long-term borrowings | 97,881 | 94,896 | - | 94,896 | - | ||||||||||||||||
Subordinated debt | 25,774 | 26,000 | - | 26,000 | - | ||||||||||||||||
Accrued interest payable | 965 | 965 | - | 965 | - | ||||||||||||||||
Fair Value Measurements | |||||||||||||||||||||
At December 31, 2012 | |||||||||||||||||||||
Quoted Prices | |||||||||||||||||||||
in Active | Significant | ||||||||||||||||||||
Markets for | Other | Significant | |||||||||||||||||||
Identical | Observable | Unobservable | |||||||||||||||||||
Carrying | Estimated | Assets | Inputs | Inputs | |||||||||||||||||
(In thousands) | amount | fair value | Level 1 | Level 2 | Level 3 | ||||||||||||||||
Financial Assets: | |||||||||||||||||||||
Cash and cash equivalents | $ | 28,802 | $ | 28,802 | $ | 28,802 | $ | - | $ | - | |||||||||||
AFS investment securities | 349,203 | 349,203 | 47 | 344,992 | 4,164 | ||||||||||||||||
Other investment | 2,250 | 2,250 | - | - | 2,250 | ||||||||||||||||
Federal Home Loan Bank stock | 6,011 | 6,011 | - | - | 6,011 | ||||||||||||||||
Loans held for sale | 1,572 | 1,572 | - | - | 1,572 | ||||||||||||||||
Loans, net | 326,904 | 330,260 | - | - | 330,260 | ||||||||||||||||
Accrued interest receivable | 10,256 | 10,256 | - | 10,256 | - | ||||||||||||||||
Financial Liabilities: | |||||||||||||||||||||
Demand deposits | 58,531 | 58,531 | - | 58,531 | - | ||||||||||||||||
NOW and money markets | 223,279 | 223,279 | - | 223,279 | - | ||||||||||||||||
Savings | 17,472 | 17,472 | - | 17,472 | - | ||||||||||||||||
Time deposits | 255,635 | 251,532 | - | 251,532 | - | ||||||||||||||||
Long-term borrowings | 108,333 | 102,824 | - | 102,824 | - | ||||||||||||||||
Subordinated debt | 25,774 | 23,837 | - | 23,837 | - | ||||||||||||||||
Accrued interest payable | 3,760 | 3,760 | - | 3,760 | - | ||||||||||||||||
SEGMENT_INFORMATION_Tables
SEGMENT INFORMATION (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
SEGMENT INFORMATION [Abstract] | ' | ||||||||||||
Selected segment information and reconciliations to consolidated financial information | ' | ||||||||||||
Selected segment information and reconciliations to consolidated financial information are as follows: | |||||||||||||
(In thousands) | Community | Tax Lien | |||||||||||
31-Dec-13 | Banking | Operation | Consolidated | ||||||||||
Total assets | $ | 707,022 | $ | 26,228 | $ | 733,250 | |||||||
Total deposits | 528,964 | - | 528,964 | ||||||||||
Interest income | $ | 25,097 | $ | 2,427 | $ | 27,524 | |||||||
Interest expense | 5,899 | 1,458 | 7,357 | ||||||||||
Net interest income | 19,198 | 969 | 20,167 | ||||||||||
(Credit) provision for loan and lease losses | (1,459 | ) | 587 | (872 | ) | ||||||||
Total non-interest income | 5,476 | 1,388 | 6,864 | ||||||||||
Total non-interest expenses | 21,959 | 4,371 | 26,330 | ||||||||||
Income tax (benefit) expense | 42 | - | 42 | ||||||||||
Net income (loss) | $ | 4,132 | $ | (2,601 | ) | $ | 1,531 | ||||||
Noncontrolling interest | 462 | (1,040 | ) | (578 | ) | ||||||||
Net income (loss) attributable to Royal Bancshares | $ | 3,670 | $ | (1,561 | ) | $ | 2,109 | ||||||
(In thousands) | Community | Tax Lien | |||||||||||
31-Dec-12 | Banking | Operation | Consolidated | ||||||||||
Total assets | $ | 732,137 | $ | 37,318 | $ | 769,455 | |||||||
Total deposits | 554,917 | - | 554,917 | ||||||||||
Interest income | $ | 26,956 | $ | 5,025 | $ | 31,981 | |||||||
Interest expense | 7,202 | 2,697 | 9,899 | ||||||||||
Net interest income | 19,754 | 2,328 | 22,082 | ||||||||||
Provision for loan and lease losses | 5,177 | 820 | 5,997 | ||||||||||
Total non-interest income | 2,868 | 741 | 3,609 | ||||||||||
Total non-interest expenses | 31,118 | 5,206 | 36,324 | ||||||||||
Income tax (benefit) expense | (28 | ) | 28 | - | |||||||||
Net loss | $ | (13,645 | ) | $ | (2,985 | ) | $ | (16,630 | ) | ||||
Noncontrolling interest | 189 | (1,194 | ) | (1,005 | ) | ||||||||
Net loss attributable to Royal Bancshares | $ | (13,834 | ) | $ | (1,791 | ) | $ | (15,625 | ) |
CONDENSED_FINANCIAL_INFORMATIO1
CONDENSED FINANCIAL INFORMATION - PARENT COMPANY ONLY (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
CONDENSED FINANCIAL INFORMATION - PARENT COMPANY ONLY [Abstract] | ' | ||||||||
CONDENSED BALANCE SHEETS | ' | ||||||||
CONDENSED BALANCE SHEETS | |||||||||
As of December 31, | |||||||||
(In thousands) | 2013 | 2012 | |||||||
Assets | |||||||||
Cash | $ | 1,333 | $ | 4,739 | |||||
Investment in non-bank subsidiaries | 29,795 | 25,830 | |||||||
Investment in Royal Bank | 42,165 | 44,725 | |||||||
Other assets | 15 | 238 | |||||||
Total assets | $ | 73,308 | $ | 75,532 | |||||
Subordinated debentures | $ | 25,774 | $ | 25,774 | |||||
Stockholders' equity | 47,534 | 49,758 | |||||||
Total liabilities and stockholders' equity | $ | 73,308 | $ | 75,532 | |||||
CONDENSED STATEMENTS OF OPERATIONS | ' | ||||||||
CONDENSED STATEMENTS OF OPERATIONS | |||||||||
For the years ended December 31, | |||||||||
(In thousands) | 2013 | 2012 | |||||||
Income | |||||||||
Other income | $ | 25 | $ | 20 | |||||
Total Income | 25 | 20 | |||||||
Expenses | |||||||||
Other expenses | 499 | 697 | |||||||
Interest on subordinated debentures | 809 | 683 | |||||||
Total Expenses | 1,308 | 1,380 | |||||||
Loss before income taxes and equity in undistributed net loss | (1,283 | ) | (1,360 | ) | |||||
Income tax expense | - | - | |||||||
Equity in undistributed net income (loss) | 3,392 | (14,265 | ) | ||||||
Net income (loss) | $ | 2,109 | $ | (15,625 | ) | ||||
CONDENSED STATEMENT OF CASH FLOWS | ' | ||||||||
CONDENSED STATEMENTS OF CASH FLOWS | |||||||||
For the years ended December 31, | |||||||||
(In thousands) | 2013 | 2012 | |||||||
Cash flows from operating activities | |||||||||
Net income (loss) | $ | 2,109 | $ | (15,625 | ) | ||||
Adjustments to reconcile net income (loss) to net cash used in operating activities: | |||||||||
Undistributed losses from subsidiaries | (3,392 | ) | 14,265 | ||||||
Interest on subordinated debentures | (2,419 | ) | 683 | ||||||
Net cash used in operating activities | (3,702 | ) | (677 | ) | |||||
Net cash provided by investing activities | - | - | |||||||
Cash flows from financing activities | |||||||||
Loan payoffs | - | 130 | |||||||
Other, net | 296 | 185 | |||||||
Net cash provided by financing activities | 296 | 315 | |||||||
Net decrease in cash and cash equivalents | (3,406 | ) | (362 | ) | |||||
Cash and cash equivalents at beginning of period | 4,739 | 5,101 | |||||||
Cash and cash equivalents at end of period | $ | 1,333 | $ | 4,739 | |||||
SUMMARY_OF_QUARTERLY_RESULTS_U1
SUMMARY OF QUARTERLY RESULTS (UNAUDITED) (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
SUMMARY OF QUARTERLY RESULTS (UNAUDITED) [Abstract] | ' | ||||||||||||||||
Summary of the Consolidated Results of Operations on a Quarterly Basis | ' | ||||||||||||||||
The following summarizes the consolidated results of operations during 2013 and 2012, on a quarterly basis, for the Company: | |||||||||||||||||
For the year ended December 31, 2013 | |||||||||||||||||
(In thousands, except per share data) | Fourth | Third | Second | First | |||||||||||||
Quarter | Quarter | Quarter | Quarter | ||||||||||||||
Interest income | $ | 7,069 | $ | 6,960 | $ | 6,743 | $ | 6,752 | |||||||||
Net interest income | 5,379 | 5,070 | 4,946 | 4,772 | |||||||||||||
(Credit) provision for loan and lease losses | (676 | ) | 218 | (163 | ) | (251 | ) | ||||||||||
Net interest income after provision | 6,055 | 4,852 | 5,109 | 5,023 | |||||||||||||
Other income | 2,558 | 1,937 | 961 | 1,408 | |||||||||||||
Other expenses | 6,333 | 6,290 | 7,567 | 6,140 | |||||||||||||
Income (loss) before income tax | 2,280 | 499 | (1,497 | ) | 291 | ||||||||||||
Income tax expense | 42 | - | - | - | |||||||||||||
Net income (loss) from continuing operations | $ | 2,238 | $ | 499 | $ | (1,497 | ) | $ | 291 | ||||||||
Less net (loss) income attributable to noncontrolling interest | (214 | ) | 157 | (694 | ) | 173 | |||||||||||
Net income (loss) attributable to Royal Bancshares of Pennsylavania, Inc. | $ | 2,452 | $ | 342 | $ | (803 | ) | $ | 118 | ||||||||
Net income (loss) available to common shareholders | $ | 1,930 | $ | (178 | ) | $ | (1,321 | ) | $ | (397 | ) | ||||||
Net income (loss) per common share | |||||||||||||||||
Basic and diluted | $ | 0.14 | $ | (0.01 | ) | $ | (0.10 | ) | $ | (0.03 | ) | ||||||
For the year ended December 31, 2012 | |||||||||||||||||
(In thousands, except per share data) | Fourth Quarter | Third Quarter | Second Quarter | First Quarter | |||||||||||||
Interest income | $ | 6,991 | $ | 7,761 | $ | 8,423 | $ | 8,806 | |||||||||
Net interest income | 4,801 | 5,382 | 5,906 | 5,993 | |||||||||||||
Provision for loan and lease losses | 2,637 | 1,761 | 1,515 | 84 | |||||||||||||
Net interest income after provision | 2,164 | 3,621 | 4,391 | 5,909 | |||||||||||||
Other income | (148 | ) | 1,151 | 1,945 | 661 | ||||||||||||
Other expenses | 10,256 | 9,409 | 8,592 | 8,067 | |||||||||||||
Loss before income tax | (8,240 | ) | (4,637 | ) | (2,256 | ) | (1,497 | ) | |||||||||
Net loss | $ | (8,240 | ) | $ | (4,637 | ) | $ | (2,256 | ) | $ | (1,497 | ) | |||||
Less net (loss) income attributable to noncontrolling interest | (246 | ) | 175 | (306 | ) | (628 | ) | ||||||||||
Net loss attributable to Royal Bancshares of Pennsylavania, Inc. | $ | (7,994 | ) | $ | (4,812 | ) | $ | (1,950 | ) | $ | (869 | ) | |||||
Net loss available to common shareholders | $ | (8,507 | ) | $ | (5,323 | ) | $ | (2,458 | ) | $ | (1,375 | ) | |||||
Net loss per common share | |||||||||||||||||
Basic and diluted | $ | (0.64 | ) | $ | (0.40 | ) | $ | (0.19 | ) | $ | (0.10 | ) |
SUMMARY_OF_SIGNIFICANT_ACCOUNT3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Loan | Loan | ||
Noncontrolling Interest [Line Items] | ' | ' | ' |
Payment to acquire additional ownership interest | $1,550,000 | ' | ' |
Amount credit to Additional Paid in Capital | 1,550,000 | ' | ' |
ASSETS | ' | ' | ' |
Total cash and cash equivalents | 16,844,000 | 28,802,000 | 24,506,000 |
Investment securities AFS, at fair value | 308,727,000 | 349,203,000 | ' |
Other investment, at cost | 2,250,000 | 2,250,000 | ' |
FHLB stock, at cost | 4,204,000 | 6,011,000 | ' |
Loans and leases held for sale | 1,446,000 | 1,572,000 | ' |
Loans and leases, net | 352,810,000 | 326,904,000 | ' |
Bank owned life insurance | 15,124,000 | 14,585,000 | ' |
Accrued interest receivable | 7,054,000 | 10,256,000 | ' |
OREO, net | 9,617,000 | 13,435,000 | ' |
Premises and equipment, net | 4,475,000 | 5,232,000 | ' |
Other assets | 9,703,000 | 11,205,000 | ' |
Total assets | 732,254,000 | 769,455,000 | ' |
Liabilities | ' | ' | ' |
Total deposits | 528,964,000 | 554,917,000 | ' |
Long-term borrowings | 97,881,000 | 108,333,000 | ' |
Subordinated debentures | 25,774,000 | 25,774,000 | ' |
Accrued interest payable | 965,000 | 3,760,000 | ' |
Other liabilities | 20,865,000 | 23,103,000 | ' |
Total liabilities | 684,449,000 | 715,887,000 | ' |
Shareholders' equity | ' | ' | ' |
Preferred stock | 29,950,000 | 29,396,000 | 28,878,000 |
Common stock | ' | 23,065,000 | ' |
Additional paid in capital | 127,299,000 | 126,287,000 | 126,245,000 |
Accumulated deficit | -120,396,000 | -121,877,000 | -105,600,000 |
Accumulated other comprehensive loss | -6,122,000 | -142,000 | 800,000 |
Treasury stock | -6,336,000 | -6,971,000 | -6,971,000 |
Noncontrolling interest | 271,000 | 3,810,000 | 4,815,000 |
Total shareholders' equity | 47,805,000 | 53,568,000 | 71,098,000 |
Total liabilities and shareholders' equity | 732,254,000 | 769,455,000 | ' |
Other investments, notice period to redeem funds | '60 days | ' | ' |
Federal Home Loan Bank Stock [Abstract] | ' | ' | ' |
Federal Home Loan Bank stock | 4,204,000 | 6,011,000 | ' |
Loans Held-for-sale [Abstract] | ' | ' | ' |
Number of loans held for sale | 3 | 1 | ' |
Non-accrual loans held for sale | 1,400,000 | 1,600,000 | ' |
Gain on transfer of loans from LHFI to LHFS recorded in non-interest income | 429,000 | ' | ' |
Allowance For Loan and Lease Losses [Abstract] | ' | ' | ' |
Rolling average period used to determine historical loss rates | '3 years | ' | ' |
Advertising Cost [Abstract] | ' | ' | ' |
Advertising costs | 209,000 | 127,000 | ' |
Benefit Plans [Abstract] | ' | ' | ' |
Highest consecutive years of employee compensation used to compute benefit | '3 years | ' | ' |
Years of employment used in benefit computation | '10 years | ' | ' |
Employer matching contribution to employee's contributions between 1% and 5% (in hundredths) | 100.00% | ' | ' |
Employee contribution matched by employer, lower range (in hundredths) | 1.00% | ' | ' |
Employer matching contribution to employees contribution that are within the specified limit (in hundredths) | 5.00% | ' | ' |
Maximum annual contribution per employee | 2,500 | ' | ' |
Employer contribution to plan | 0 | 0 | ' |
Stock Compensation [Abstract] | ' | ' | ' |
Compensation expense | 22,000 | 42,000 | ' |
Income Taxes [Abstract] | ' | ' | ' |
Unrecognized tax benefits | ' | 0 | 0 |
Accrued interest and penalties on unrecognized tax benefits | ' | 0 | 0 |
Net income (loss) per common share [Abstract] | ' | ' | ' |
Rate class B shares may be converted to class A shares | '1.15 to 1 | ' | ' |
Restrictions on Cash and Amounts Due From Banks [Abstract] | ' | ' | ' |
Average balances on hand with the Federal Reserve Bank | 100,000 | 100,000 | ' |
Restatement Adjustment [Member] | ' | ' | ' |
ASSETS | ' | ' | ' |
Total cash and cash equivalents | ' | 0 | ' |
Investment securities AFS, at fair value | ' | 0 | ' |
Other investment, at cost | ' | 0 | ' |
FHLB stock, at cost | ' | 0 | ' |
Loans and leases held for sale | ' | 0 | ' |
Loans and leases, net | ' | 0 | ' |
Bank owned life insurance | ' | 0 | ' |
Accrued interest receivable | ' | 0 | ' |
OREO, net | ' | 0 | ' |
Premises and equipment, net | ' | 0 | ' |
Other assets | ' | -4,261,000 | ' |
Total assets | ' | -4,261,000 | ' |
Liabilities | ' | ' | ' |
Total deposits | ' | 0 | ' |
Long-term borrowings | ' | 0 | ' |
Subordinated debentures | ' | 0 | ' |
Accrued interest payable | ' | 0 | ' |
Other liabilities | ' | 586,000 | ' |
Total liabilities | ' | 586,000 | ' |
Shareholders' equity | ' | ' | ' |
Preferred stock | ' | 0 | 0 |
Common stock | ' | 0 | ' |
Additional paid in capital | ' | 0 | 0 |
Accumulated deficit | ' | -4,797,000 | -4,797,000 |
Accumulated other comprehensive loss | ' | 0 | 0 |
Treasury stock | ' | 0 | 0 |
Noncontrolling interest | ' | -50,000 | -50,000 |
Total shareholders' equity | ' | -4,847,000 | -4,847,000 |
Total liabilities and shareholders' equity | ' | -4,261,000 | ' |
Federal Home Loan Bank Stock [Abstract] | ' | ' | ' |
Federal Home Loan Bank stock | ' | 0 | ' |
Scenario, Previously Reported [Member] | ' | ' | ' |
ASSETS | ' | ' | ' |
Total cash and cash equivalents | ' | 28,802,000 | ' |
Investment securities AFS, at fair value | ' | 349,203,000 | ' |
Other investment, at cost | ' | 2,250,000 | ' |
FHLB stock, at cost | ' | 6,011,000 | ' |
Loans and leases held for sale | ' | 1,572,000 | ' |
Loans and leases, net | ' | 326,904,000 | ' |
Bank owned life insurance | ' | 14,585,000 | ' |
Accrued interest receivable | ' | 10,256,000 | ' |
OREO, net | ' | 13,435,000 | ' |
Premises and equipment, net | ' | 5,232,000 | ' |
Other assets | ' | 15,466,000 | ' |
Total assets | ' | 773,716,000 | ' |
Liabilities | ' | ' | ' |
Total deposits | ' | 554,917,000 | ' |
Long-term borrowings | ' | 108,333,000 | ' |
Subordinated debentures | ' | 25,774,000 | ' |
Accrued interest payable | ' | 3,760,000 | ' |
Other liabilities | ' | 22,517,000 | ' |
Total liabilities | ' | 715,301,000 | ' |
Shareholders' equity | ' | ' | ' |
Preferred stock | ' | 29,396,000 | 28,878,000 |
Common stock | ' | 23,065,000 | ' |
Additional paid in capital | ' | 126,287,000 | 126,245,000 |
Accumulated deficit | ' | -117,080,000 | -100,803,000 |
Accumulated other comprehensive loss | ' | -142,000 | 800,000 |
Treasury stock | ' | -6,971,000 | -6,971,000 |
Noncontrolling interest | ' | 3,860,000 | 4,865,000 |
Total shareholders' equity | ' | 58,415,000 | 75,945,000 |
Total liabilities and shareholders' equity | ' | 773,716,000 | ' |
Federal Home Loan Bank Stock [Abstract] | ' | ' | ' |
Federal Home Loan Bank stock | ' | 6,011,000 | ' |
Common Class B [Member] | ' | ' | ' |
Shareholders' equity | ' | ' | ' |
Common stock | 199,000 | 202,000 | 208,000 |
Total shareholders' equity | 199,000 | 202,000 | 208,000 |
Common Class B [Member] | Restatement Adjustment [Member] | ' | ' | ' |
Shareholders' equity | ' | ' | ' |
Common stock | ' | ' | 0 |
Common Class B [Member] | Scenario, Previously Reported [Member] | ' | ' | ' |
Shareholders' equity | ' | ' | ' |
Common stock | ' | ' | 208,000 |
Common Class A [Member] | ' | ' | ' |
Shareholders' equity | ' | ' | ' |
Common stock | 22,940,000 | 22,863,000 | 22,723,000 |
Total shareholders' equity | 22,940,000 | 22,863,000 | 22,723,000 |
Common Class A [Member] | Restatement Adjustment [Member] | ' | ' | ' |
Shareholders' equity | ' | ' | ' |
Common stock | ' | ' | 0 |
Common Class A [Member] | Scenario, Previously Reported [Member] | ' | ' | ' |
Shareholders' equity | ' | ' | ' |
Common stock | ' | ' | 22,723,000 |
Commercial Real Estate Loans [Member] | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' |
Concentration risk, percentage (in hundredths) | 40.00% | ' | ' |
Commercial [Member] | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' |
Concentration risk, percentage (in hundredths) | 22.00% | ' | ' |
Construction and Development Loans [Member] | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' |
Concentration risk, percentage (in hundredths) | 12.00% | ' | ' |
Securities Issued By Government Sponsored Entities [Member] | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' |
Concentration risk, percentage (in hundredths) | 92.00% | ' | ' |
Crusader Servicing Corporation [Member] | ' | ' | ' |
Noncontrolling Interest [Line Items] | ' | ' | ' |
Percentage of ownership interest in subsidiary (in hundredths) | ' | 60.00% | ' |
Payment settlement related to relinquished ownership interest | 1,250,000 | ' | ' |
Percentage of relinquished ownership interest (in hundredths) | 20.00% | ' | ' |
Total percentage of ownership interest (in hundredths) | 80.00% | ' | ' |
Royal Tax Lien Services, LLC [Member] | ' | ' | ' |
Noncontrolling Interest [Line Items] | ' | ' | ' |
Percentage of ownership interest in subsidiary (in hundredths) | ' | 60.00% | ' |
Percentage of additional ownership interest acquired (in hundredths) | 40.00% | ' | ' |
Payment to acquire additional ownership interest | 850,000 | ' | ' |
Payment for tax distribution related additional ownership interest | 400,000 | ' | ' |
Amount credit to Additional Paid in Capital | 850,000 | ' | ' |
Total percentage of ownership interest (in hundredths) | 100.00% | ' | ' |
Royal Bank America Leasing, LP [Member] | ' | ' | ' |
Noncontrolling Interest [Line Items] | ' | ' | ' |
Percentage of ownership interest in subsidiary (in hundredths) | 60.00% | ' | ' |
Additional Paid In Capital [Member] | ' | ' | ' |
Noncontrolling Interest [Line Items] | ' | ' | ' |
Payment to acquire additional ownership interest | 1,500,000 | ' | ' |
Amount credit to Additional Paid in Capital | 1,500,000 | ' | ' |
Royal Bancshares Capital Trust I and II [Member] | ' | ' | ' |
Trust Preferred Securities [Abstract] | ' | ' | ' |
Aggregate principal balance | 774,000 | ' | ' |
Crusader Servicing Corporation and Royal Tax Lien Services, LLC [Member] | ' | ' | ' |
Noncontrolling Interest [Line Items] | ' | ' | ' |
Combined value of ownership interest | $2,600,000 | ' | ' |
REGULATORY_MATTERS_and_SIGNIFI1
REGULATORY MATTERS and SIGNIFICANT RISKS and UNCERTAINTIES (Details) (USD $) | 3 Months Ended | 12 Months Ended | 60 Months Ended | |||||||||
Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2011 | |
Building | Restriction | |||||||||||
Branch | Building | |||||||||||
Branch | ||||||||||||
Federal Deposit Insurance Corporation and Department of Banking Orders [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Minimum Tier one leverage ratio required (in hundredths) | 8.00% | ' | ' | ' | ' | ' | ' | ' | 8.00% | ' | ' | ' |
Minimum total capital to risk weighted assets ratio required (in hundredths) | 12.00% | ' | ' | ' | ' | ' | ' | ' | 12.00% | ' | ' | ' |
Tier I capital (to average assets, leverage) (in hundredths) | 9.13% | ' | ' | ' | 8.00% | ' | ' | ' | 9.13% | 8.00% | 8.00% | ' |
Total capital (to risk-weighted assets) (in hundredths) | 15.61% | ' | ' | ' | 15.22% | ' | ' | ' | 15.61% | 15.22% | 15.22% | ' |
Net Income [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Continued significant losses over five calendar years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $118,200,000 | ' |
Net income (loss) | 2,452,000 | 342,000 | -803,000 | 118,000 | -7,994,000 | -4,812,000 | -1,950,000 | -869,000 | 2,109,000 | -15,625,000 | ' | ' |
Decline in credit related expenses | 3,600,000 | ' | ' | ' | ' | ' | ' | ' | 7,400,000 | ' | ' | ' |
Decline in provision for loan and lease losses | 3,300,000 | ' | ' | ' | ' | ' | ' | ' | 6,900,000 | ' | ' | ' |
Decline in OTTI on investment securities | 1,500,000 | ' | ' | ' | ' | ' | ' | ' | 2,400,000 | ' | ' | ' |
Decline in salaries and benefits | ' | ' | ' | ' | ' | ' | ' | ' | 1,300,000 | ' | ' | ' |
Decline in professional and legal fees | ' | ' | ' | ' | ' | ' | ' | ' | 1,200,000 | ' | ' | ' |
Gain on sale of OREO | ' | ' | ' | ' | ' | ' | ' | ' | 2,524,000 | 0 | ' | ' |
Increase in net gain on sale of OREO | ' | ' | ' | ' | ' | ' | ' | ' | 1,100,000 | ' | ' | ' |
Decline in net interest income | ' | ' | ' | ' | ' | ' | ' | ' | 1,900,000 | ' | ' | ' |
Decrease in gains on sale of loans and leases | ' | ' | ' | ' | ' | ' | ' | ' | 1,400,000 | ' | ' | ' |
Decline in gains on sale of investment securities | ' | ' | ' | ' | ' | ' | ' | ' | 872,000 | ' | ' | ' |
Deferred tax valuation allowance | -37,159,000 | ' | ' | ' | -39,597,000 | ' | ' | ' | -37,159,000 | -39,597,000 | -39,597,000 | ' |
Financing Receivable, Recorded Investment [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Non performing loans, charge-offs | ' | ' | ' | ' | ' | ' | ' | ' | 3,893,000 | 6,271,000 | ' | ' |
Other real estate owned (OREO) | 9,617,000 | ' | ' | ' | 13,435,000 | ' | ' | ' | 9,617,000 | 13,435,000 | 13,435,000 | ' |
Net classified loans and foreclosed property | 32,200,000 | ' | ' | ' | 51,800,000 | ' | ' | ' | 32,200,000 | 51,800,000 | 51,800,000 | ' |
Other than temporary impairment losses on securities recognized in earnings | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 2,359,000 | ' | ' |
Liquidity and Funds Management [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Collateralized delivery requirement with Federal Home Loan Banks (in hundredths) | ' | ' | ' | ' | 105.00% | ' | ' | ' | ' | 105.00% | 105.00% | ' |
Available borrowing capacity at the federal home loan bank | 190,000,000 | ' | ' | ' | ' | ' | ' | ' | 190,000,000 | ' | ' | ' |
Number of collateral restrictions removed | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' |
Limited availability to borrow from the federal reserve discount window | 7,200,000 | ' | ' | ' | ' | ' | ' | ' | 7,200,000 | ' | ' | ' |
Borrowings | 107,900,000 | ' | ' | ' | 108,300,000 | ' | ' | ' | 107,900,000 | 108,300,000 | 108,300,000 | ' |
Liquidity to deposits ratio (in hundredths) | 72.20% | ' | ' | ' | ' | ' | ' | ' | 72.20% | ' | ' | ' |
Liquidity to deposit ratio, policy target (in hundredths) | 12.00% | ' | ' | ' | ' | ' | ' | ' | 12.00% | ' | ' | ' |
Liquidity to total liabilities ratio (in hundredths) | 55.80% | ' | ' | ' | ' | ' | ' | ' | 55.80% | ' | ' | ' |
Liquidity to total liability ratio, policy target (in hundredths) | 10.00% | ' | ' | ' | ' | ' | ' | ' | 10.00% | ' | ' | ' |
Unfunded pension plan obligations | 14,500,000 | ' | ' | ' | ' | ' | ' | ' | 14,500,000 | ' | ' | ' |
Class of Stock [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Series A Preferred stock, with quarterly cash dividend suspended | 29,950,000 | ' | ' | ' | 29,396,000 | ' | ' | ' | 29,950,000 | 29,396,000 | 29,396,000 | 28,878,000 |
Trust preferred securities with suspended interest payment | 25,774,000 | ' | ' | ' | 25,774,000 | ' | ' | ' | 25,774,000 | 25,774,000 | 25,774,000 | ' |
Interest payments in arrears on trust preferred securities | ' | ' | ' | ' | ' | ' | ' | ' | 3,100,000 | ' | ' | ' |
Interest payments on trust preferred securities including penalty | 174,000 | ' | ' | ' | ' | ' | ' | ' | 174,000 | ' | ' | ' |
Capital Adequacy [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Minimum total capital to risk weighted assets ratio required (in hundredths) | 12.00% | ' | ' | ' | ' | ' | ' | ' | 12.00% | ' | ' | ' |
Minimum Tier one leverage ratio required (in hundredths) | 8.00% | ' | ' | ' | ' | ' | ' | ' | 8.00% | ' | ' | ' |
Total capital (to risk-weighted assets) (in hundredths) | 15.61% | ' | ' | ' | 15.22% | ' | ' | ' | 15.61% | 15.22% | 15.22% | ' |
Tier I capital (to average assets, leverage) (in hundredths) | 9.13% | ' | ' | ' | 8.00% | ' | ' | ' | 9.13% | 8.00% | 8.00% | ' |
Company Plans and Strategy [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Reduction in workforce (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | 22.00% | ' | ' | ' |
Restructuring charges related to reduction in workforce | ' | ' | ' | ' | ' | ' | ' | ' | 87,000 | ' | ' | ' |
Number of branches consolidated under rationalization | 2 | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' |
Number of buildings sold under rationalization | 4 | ' | ' | ' | ' | ' | ' | ' | 4 | ' | ' | ' |
Number of branches being relocated | 2 | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' |
Time period for relocation, minimum (in months) | '3 months | ' | ' | ' | ' | ' | ' | ' | '3 months | ' | ' | ' |
Time period for relocation, maximum (in months) | '8 months | ' | ' | ' | ' | ' | ' | ' | '8 months | ' | ' | ' |
Series A Preferred Stock [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Class of Stock [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Series A Preferred stock, with quarterly cash dividend suspended | 30,400,000 | ' | ' | ' | ' | ' | ' | ' | 30,400,000 | ' | ' | ' |
Preferred stock dividend in arrears | ' | ' | ' | ' | ' | ' | ' | ' | 7,700,000 | ' | ' | ' |
Nonperforming loans [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Financing Receivable, Recorded Investment [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Non performing loans | 10,200,000 | ' | ' | ' | 23,000,000 | ' | ' | ' | 10,200,000 | 23,000,000 | 23,000,000 | ' |
Non performing loans, charge-offs | ' | ' | ' | ' | ' | ' | ' | ' | 3,900,000 | 6,300,000 | ' | ' |
Other real estate owned (OREO) | 9,617,000 | ' | ' | ' | 13,435,000 | ' | ' | ' | 9,617,000 | 13,435,000 | 13,435,000 | ' |
Delinquent loans held for investment | 2,600,000 | ' | ' | ' | 4,600,000 | ' | ' | ' | 2,600,000 | 4,600,000 | 4,600,000 | ' |
Royal Bank [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Federal Deposit Insurance Corporation and Department of Banking Orders [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Minimum Tier one leverage ratio required (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8.00% |
Minimum total capital to risk weighted assets ratio required (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 12.00% |
Tier I capital (to average assets, leverage) (in hundredths) | 9.13% | ' | ' | ' | 8.00% | ' | ' | ' | 9.13% | 8.00% | 8.00% | ' |
Total capital (to risk-weighted assets) (in hundredths) | 15.61% | ' | ' | ' | 15.22% | ' | ' | ' | 15.61% | 15.22% | 15.22% | ' |
Net Income [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) | ' | ' | ' | ' | ' | ' | ' | ' | $2,705,000 | ($13,243,000) | ' | ' |
Capital Adequacy [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Minimum total capital to risk weighted assets ratio required (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 12.00% |
Minimum Tier one leverage ratio required (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8.00% |
Total capital (to risk-weighted assets) (in hundredths) | 15.61% | ' | ' | ' | 15.22% | ' | ' | ' | 15.61% | 15.22% | 15.22% | ' |
Tier I capital (to average assets, leverage) (in hundredths) | 9.13% | ' | ' | ' | 8.00% | ' | ' | ' | 9.13% | 8.00% | 8.00% | ' |
INVESTMENT_SECURITIES_Details
INVESTMENT SECURITIES (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Position | Position | |
Carrying value and fair value of available for sale investment securities [Abstract] | ' | ' |
Amortized cost | $313,852,000 | $343,879,000 |
Gross unrealized gains | 4,568,000 | 6,270,000 |
Gross unrealized losses | -9,693,000 | -946,000 |
Gross unrealized losses, Non-credit related OTTI in AOCI | 0 | 0 |
Fair value | 308,727,000 | 349,203,000 |
Decrease in investment portfolio | -40,500,000 | ' |
Amortized cost [Abstract] | ' | ' |
Within 1 year | 11,806,000 | ' |
After 1 but within 5 years | 6,432,000 | ' |
After 5 but within 10 years | 33,519,000 | ' |
After 10 years | 33,282,000 | ' |
Mortgage-backed securities-residential | 32,769,000 | ' |
Collateralized mortgage obligations Issued or guaranteed by U.S. government agencies | 188,194,000 | ' |
Collateralized mortgage obligations Non-agency | 4,454,000 | ' |
Total available for sale debt securities | 310,456,000 | ' |
No contractual maturity | 3,396,000 | ' |
Total available for sale securities | 313,852,000 | ' |
Fair value [Abstract] | ' | ' |
Within 1 year | 10,257,000 | ' |
After 1 but within 5 years | 6,359,000 | ' |
After 5 but within 10 years | 31,246,000 | ' |
After 10 years | 30,512,000 | ' |
Mortgage-backed securities residential | 32,097,000 | ' |
Collateralized mortgage obligations issued or guaranteed by U.S. government agencies | 189,103,000 | ' |
Collateralized mortgage obligations Non-agency | 4,479,000 | ' |
Total available for sale debt securities | 304,053,000 | ' |
No contractual maturity | 4,674,000 | ' |
Total available for sale securities | 308,727,000 | ' |
Proceeds from sales of AFS investment securities | 31,046,000 | 28,246,000 |
Gross realized gains and losses on the sale of securities recognized in earnings [Abstract] | ' | ' |
Gross realized gains | 416,000 | 1,211,000 |
Gross realized losses | -258,000 | -181,000 |
Net realized gains | 158,000 | 1,030,000 |
Available-for-sale securities pledged as collateral | 70,400,000 | ' |
Available for sale securities, continuous unrealized loss position [Abstract] | ' | ' |
Less than 12 months, Fair value | 142,071,000 | 83,086,000 |
12 months or longer, Fair value | 33,664,000 | 6,053,000 |
Total, Fair value | 175,735,000 | 89,139,000 |
Less than 12 months, Gross unrealized losses | -7,322,000 | -789,000 |
12 months or longer, Gross unrealized losses | -2,371,000 | -157,000 |
Total, Gross unrealized losses | -9,693,000 | -946,000 |
Less than 12 months, Number of positions | 54 | 33 |
12 months or longer, Number of positions | 17 | 5 |
Total, Number of positions | 71 | 38 |
Percentage of negatively impact on market value of securities (in hundredths) | 72.00% | ' |
Period of treasury yield | '10 years | ' |
Percentage of treasury yield (in hundredths) | 3.03% | 1.76% |
Gain recorded by common stock investment sold | ' | 112,000 |
Other than Temporary Impairment Losses, Investments, Available-for-sale Securities [Abstract] | ' | ' |
Balance at beginning of year | 173,000 | 173,000 |
Reductions for securities sold during the period (realized) | -173,000 | 0 |
Balance at end of year | 0 | 173,000 |
Credit related impairment losses on debt securities held for which a portion of OTTI was recognized in other comprehensive income [Roll Forward] | ' | ' |
Other than temporary impairment losses on securities recognized in earnings | 0 | 2,359,000 |
U.S. Government Agencies [Member] | ' | ' |
Carrying value and fair value of available for sale investment securities [Abstract] | ' | ' |
Amortized cost | 68,207,000 | 66,371,000 |
Gross unrealized gains | 0 | 151,000 |
Gross unrealized losses | -6,171,000 | -78,000 |
Gross unrealized losses, Non-credit related OTTI in AOCI | 0 | 0 |
Fair value | 62,036,000 | 66,444,000 |
Available for sale securities, continuous unrealized loss position [Abstract] | ' | ' |
Less than 12 months, Fair value | 48,919,000 | 23,818,000 |
12 months or longer, Fair value | 12,267,000 | 0 |
Total, Fair value | 61,186,000 | 23,818,000 |
Less than 12 months, Gross unrealized losses | -5,035,000 | -78,000 |
12 months or longer, Gross unrealized losses | -1,136,000 | 0 |
Total, Gross unrealized losses | -6,171,000 | -78,000 |
Less than 12 months, Number of positions | 16 | 8 |
12 months or longer, Number of positions | 5 | 0 |
Total, Number of positions | 21 | 8 |
Increase in gross unrealized losses from year to year | 6,200,000 | ' |
Mortgage-backed Securities-residential [Member] | ' | ' |
Carrying value and fair value of available for sale investment securities [Abstract] | ' | ' |
Amortized cost | 32,769,000 | 30,038,000 |
Gross unrealized gains | 210,000 | 518,000 |
Gross unrealized losses | -882,000 | -47,000 |
Gross unrealized losses, Non-credit related OTTI in AOCI | 0 | 0 |
Fair value | 32,097,000 | 30,509,000 |
Available for sale securities, continuous unrealized loss position [Abstract] | ' | ' |
Less than 12 months, Fair value | 18,045,000 | 7,280,000 |
12 months or longer, Fair value | 6,276,000 | 0 |
Total, Fair value | 24,321,000 | 7,280,000 |
Less than 12 months, Gross unrealized losses | -518,000 | -47,000 |
12 months or longer, Gross unrealized losses | -364,000 | 0 |
Total, Gross unrealized losses | -882,000 | -47,000 |
Less than 12 months, Number of positions | 7 | 2 |
12 months or longer, Number of positions | 2 | 0 |
Total, Number of positions | 9 | 2 |
Increase in gross unrealized losses from year to year | 835,000 | ' |
Collateralized Mortgage Obligations, Issued or Guaranteed by U.S. Government Agencies [Member] | ' | ' |
Carrying value and fair value of available for sale investment securities [Abstract] | ' | ' |
Amortized cost | 188,194,000 | 229,556,000 |
Gross unrealized gains | 2,887,000 | 5,031,000 |
Gross unrealized losses | -1,978,000 | -611,000 |
Gross unrealized losses, Non-credit related OTTI in AOCI | 0 | 0 |
Fair value | 189,103,000 | 233,976,000 |
Available for sale securities, continuous unrealized loss position [Abstract] | ' | ' |
Less than 12 months, Fair value | 67,240,000 | 44,937,000 |
12 months or longer, Fair value | 9,974,000 | 3,975,000 |
Total, Fair value | 77,214,000 | 48,912,000 |
Less than 12 months, Gross unrealized losses | -1,446,000 | -592,000 |
12 months or longer, Gross unrealized losses | -532,000 | -19,000 |
Total, Gross unrealized losses | -1,978,000 | -611,000 |
Less than 12 months, Number of positions | 21 | 15 |
12 months or longer, Number of positions | 3 | 2 |
Total, Number of positions | 24 | 17 |
Increase in gross unrealized losses from year to year | 1,400,000 | ' |
Collateralized Mortgage Obligations, Non-agency [Member] | ' | ' |
Carrying value and fair value of available for sale investment securities [Abstract] | ' | ' |
Amortized cost | 4,454,000 | 1,007,000 |
Gross unrealized gains | 25,000 | 4,000 |
Gross unrealized losses | 0 | 0 |
Gross unrealized losses, Non-credit related OTTI in AOCI | 0 | 0 |
Fair value | 4,479,000 | 1,011,000 |
Available for sale securities, continuous unrealized loss position [Abstract] | ' | ' |
Number of securities with unrealized gains | 2 | ' |
Corporate Bonds [Member] | ' | ' |
Carrying value and fair value of available for sale investment securities [Abstract] | ' | ' |
Amortized cost | 9,669,000 | 7,477,000 |
Gross unrealized gains | 25,000 | 32,000 |
Gross unrealized losses | -256,000 | -72,000 |
Gross unrealized losses, Non-credit related OTTI in AOCI | 0 | 0 |
Fair value | 9,438,000 | 7,437,000 |
Available for sale securities, continuous unrealized loss position [Abstract] | ' | ' |
Less than 12 months, Fair value | 4,848,000 | 2,165,000 |
12 months or longer, Fair value | 965,000 | 941,000 |
Total, Fair value | 5,813,000 | 3,106,000 |
Less than 12 months, Gross unrealized losses | -221,000 | -13,000 |
12 months or longer, Gross unrealized losses | -35,000 | -59,000 |
Total, Gross unrealized losses | -256,000 | -72,000 |
Less than 12 months, Number of positions | 5 | 2 |
12 months or longer, Number of positions | 1 | 1 |
Total, Number of positions | 6 | 3 |
Number of securities at or above investment grade | 6 | ' |
Municipal Bonds [Member] | ' | ' |
Carrying value and fair value of available for sale investment securities [Abstract] | ' | ' |
Amortized cost | 7,163,000 | 5,645,000 |
Gross unrealized gains | 0 | 0 |
Gross unrealized losses | -263,000 | -30,000 |
Gross unrealized losses, Non-credit related OTTI in AOCI | 0 | 0 |
Fair value | 6,900,000 | 5,615,000 |
Available for sale securities, continuous unrealized loss position [Abstract] | ' | ' |
Less than 12 months, Fair value | 3,019,000 | 4,597,000 |
12 months or longer, Fair value | 3,881,000 | 882,000 |
Total, Fair value | 6,900,000 | 5,479,000 |
Less than 12 months, Gross unrealized losses | -102,000 | -21,000 |
12 months or longer, Gross unrealized losses | -161,000 | -9,000 |
Total, Gross unrealized losses | -263,000 | -30,000 |
Less than 12 months, Number of positions | 5 | 5 |
12 months or longer, Number of positions | 4 | 1 |
Total, Number of positions | 9 | 6 |
Common Stocks [Member] | ' | ' |
Carrying value and fair value of available for sale investment securities [Abstract] | ' | ' |
Amortized cost | 33,000 | 33,000 |
Gross unrealized gains | 16,000 | 14,000 |
Gross unrealized losses | 0 | 0 |
Gross unrealized losses, Non-credit related OTTI in AOCI | 0 | 0 |
Fair value | 49,000 | 47,000 |
Available for sale securities, continuous unrealized loss position [Abstract] | ' | ' |
Number of securities with unrealized gains | 2 | ' |
Number of investment securities sold | ' | 1 |
Other Securities [Member] | ' | ' |
Carrying value and fair value of available for sale investment securities [Abstract] | ' | ' |
Amortized cost | 3,363,000 | 3,752,000 |
Gross unrealized gains | 1,405,000 | 520,000 |
Gross unrealized losses | -143,000 | -108,000 |
Gross unrealized losses, Non-credit related OTTI in AOCI | 0 | 0 |
Fair value | 4,625,000 | 4,164,000 |
Available for sale securities, continuous unrealized loss position [Abstract] | ' | ' |
Less than 12 months, Fair value | 0 | 289,000 |
12 months or longer, Fair value | 301,000 | 255,000 |
Total, Fair value | 301,000 | 544,000 |
Less than 12 months, Gross unrealized losses | 0 | -38,000 |
12 months or longer, Gross unrealized losses | -143,000 | -70,000 |
Total, Gross unrealized losses | -143,000 | -108,000 |
Less than 12 months, Number of positions | 0 | 1 |
12 months or longer, Number of positions | 2 | 1 |
Total, Number of positions | 2 | 2 |
Number of securities invested in real estate funds | 7 | ' |
Number of securities considered not to be other than temporarily impaired | 2 | ' |
Number of securities recording an impairment charge | ' | 2 |
Impairment charges on private equity funds | ' | 1,500,000 |
Credit related impairment charge on private equity fund | ' | 859,000 |
Credit related impairment losses on debt securities held for which a portion of OTTI was recognized in other comprehensive income [Roll Forward] | ' | ' |
Other than temporary impairment losses on securities recognized in earnings | $0 | $2,359,000 |
LOANS_AND_LEASES_Major_Classif
LOANS AND LEASES - Major Classification of LHFI (Details) (USD $) | 12 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2012 | |||
Loan | ||||
Major classifications of loans held for investment [Abstract] | ' | ' | ||
Total gross loans | $366,481,000 | $344,682,000 | ||
Less: Deferred loan fees | 0 | [1] | -517,000 | [1] |
Total LHFI, net of unearned income | 366,481,000 | 344,165,000 | ||
Related Party Transaction [Line Items] | ' | ' | ||
Number of new related party loans | 0 | ' | ||
Officer and Directors [Member] | ' | ' | ||
Related Party Transaction [Line Items] | ' | ' | ||
Loan and loan commitments | 234,000 | 1,400,000 | ||
Payments received from related party loans | 1,200,000 | ' | ||
Commercial Real Estate [Member] | ' | ' | ||
Major classifications of loans held for investment [Abstract] | ' | ' | ||
Total gross loans | 148,293,000 | 167,115,000 | ||
Construction and Land Development [Member] | ' | ' | ||
Major classifications of loans held for investment [Abstract] | ' | ' | ||
Total gross loans | 45,261,000 | 37,215,000 | ||
Total LHFI, net of unearned income | 45,261,000 | ' | ||
Commercial and Industrial [Member] | ' | ' | ||
Major classifications of loans held for investment [Abstract] | ' | ' | ||
Total gross loans | 79,589,000 | 40,560,000 | ||
Multi Family [Member] | ' | ' | ||
Major classifications of loans held for investment [Abstract] | ' | ' | ||
Total gross loans | 11,737,000 | 11,756,000 | ||
Total LHFI, net of unearned income | 11,737,000 | ' | ||
Residential Real Estate [Member] | ' | ' | ||
Major classifications of loans held for investment [Abstract] | ' | ' | ||
Total gross loans | 25,535,000 | 24,981,000 | ||
Leases [Member] | ' | ' | ||
Major classifications of loans held for investment [Abstract] | ' | ' | ||
Total gross loans | 42,524,000 | 37,347,000 | ||
Total LHFI, net of unearned income | 42,524,000 | ' | ||
Tax Certificates [Member] | ' | ' | ||
Major classifications of loans held for investment [Abstract] | ' | ' | ||
Total gross loans | 12,716,000 | 24,569,000 | ||
Total LHFI, net of unearned income | 12,716,000 | ' | ||
Consumer [Member] | ' | ' | ||
Major classifications of loans held for investment [Abstract] | ' | ' | ||
Total gross loans | 826,000 | 1,139,000 | ||
Total LHFI, net of unearned income | $826,000 | ' | ||
[1] | For the 2013 period net deferred fees were allocated among the various loan types. |
LOANS_AND_LEASES_Risk_Ratings_
LOANS AND LEASES - Risk Ratings for Each Loan Portfolio Segment (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | ||
In Thousands, unless otherwise specified | ||||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | $366,481 | $344,682 | ||
Less: Deferred loan fees | 0 | [1] | -517 | [1] |
Total LHFI | 366,481 | 344,165 | ||
Construction and Land Development [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | 45,261 | 37,215 | ||
Total LHFI | 45,261 | ' | ||
Commercial Real Estate [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 167,115 | ||
Total LHFI | 148,293 | ' | ||
Commercial and Industrial [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 40,560 | ||
Total LHFI | 79,589 | ' | ||
Residential Real Estate [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 24,981 | ||
Total LHFI | 25,535 | ' | ||
Multi Family [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | 11,737 | 11,756 | ||
Total LHFI | 11,737 | ' | ||
Leases [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | 42,524 | 37,347 | ||
Total LHFI | 42,524 | ' | ||
Tax Certificates [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | 12,716 | 24,569 | ||
Total LHFI | 12,716 | ' | ||
Consumer Portfolio Segment [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 1,139 | ||
Total LHFI | 826 | ' | ||
Pass [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 167,004 | ||
Total LHFI | 254,712 | ' | ||
Pass [Member] | Construction and Land Development [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 2,139 | ||
Total LHFI | 14,677 | ' | ||
Pass [Member] | Commercial Real Estate [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 64,308 | ||
Total LHFI | 99,525 | ' | ||
Pass [Member] | Commercial and Industrial [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 14,764 | ||
Total LHFI | 50,478 | ' | ||
Pass [Member] | Residential Real Estate [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 15,125 | ||
Total LHFI | 24,903 | ' | ||
Pass [Member] | Multi Family [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 9,019 | ||
Total LHFI | 10,792 | ' | ||
Pass [Member] | Leases [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 36,755 | ||
Total LHFI | 41,325 | ' | ||
Pass [Member] | Tax Certificates [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 23,968 | ||
Total LHFI | 12,262 | ' | ||
Pass [Member] | Consumer Portfolio Segment [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 926 | ||
Total LHFI | 750 | ' | ||
Pass-Watch [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 103,362 | ||
Total LHFI | 60,016 | ' | ||
Pass-Watch [Member] | Construction and Land Development [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 13,872 | ||
Total LHFI | 16,270 | ' | ||
Pass-Watch [Member] | Commercial Real Estate [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 69,510 | ||
Total LHFI | 32,267 | ' | ||
Pass-Watch [Member] | Commercial and Industrial [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 10,774 | ||
Total LHFI | 10,508 | ' | ||
Pass-Watch [Member] | Residential Real Estate [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 6,634 | ||
Total LHFI | 0 | ' | ||
Pass-Watch [Member] | Multi Family [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 2,034 | ||
Total LHFI | 410 | ' | ||
Pass-Watch [Member] | Leases [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 325 | ||
Total LHFI | 485 | ' | ||
Pass-Watch [Member] | Tax Certificates [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 0 | ||
Total LHFI | 0 | ' | ||
Pass-Watch [Member] | Consumer Portfolio Segment [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 213 | ||
Total LHFI | 76 | ' | ||
Special Mention [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 37,285 | ||
Total LHFI | 29,184 | ' | ||
Special Mention [Member] | Construction and Land Development [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 16,343 | ||
Total LHFI | 11,095 | ' | ||
Special Mention [Member] | Commercial Real Estate [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 19,529 | ||
Total LHFI | 11,572 | ' | ||
Special Mention [Member] | Commercial and Industrial [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 92 | ||
Total LHFI | 5,735 | ' | ||
Special Mention [Member] | Residential Real Estate [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 602 | ||
Total LHFI | 0 | ' | ||
Special Mention [Member] | Multi Family [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 703 | ||
Total LHFI | 535 | ' | ||
Special Mention [Member] | Leases [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 16 | ||
Total LHFI | 247 | ' | ||
Special Mention [Member] | Tax Certificates [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 0 | ||
Total LHFI | 0 | ' | ||
Special Mention [Member] | Consumer Portfolio Segment [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 0 | ||
Total LHFI | 0 | ' | ||
Substandard [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 15,599 | ||
Total LHFI | 12,412 | ' | ||
Substandard [Member] | Construction and Land Development [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 581 | ||
Total LHFI | 569 | ' | ||
Substandard [Member] | Commercial Real Estate [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 3,423 | ||
Total LHFI | 2,604 | ' | ||
Substandard [Member] | Commercial and Industrial [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 9,969 | ||
Total LHFI | 9,239 | ' | ||
Substandard [Member] | Residential Real Estate [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 1,626 | ||
Total LHFI | 0 | ' | ||
Substandard [Member] | Multi Family [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 0 | ||
Total LHFI | 0 | ' | ||
Substandard [Member] | Leases [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 0 | ||
Total LHFI | 0 | ' | ||
Substandard [Member] | Tax Certificates [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 0 | ||
Total LHFI | 0 | ' | ||
Substandard [Member] | Consumer Portfolio Segment [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 0 | ||
Total LHFI | 0 | ' | ||
Non-accrual [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 21,432 | ||
Total LHFI | 10,157 | ' | ||
Non-accrual [Member] | Construction and Land Development [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 4,280 | ||
Total LHFI | 2,650 | ' | ||
Non-accrual [Member] | Commercial Real Estate [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 10,345 | ||
Total LHFI | 2,325 | ' | ||
Non-accrual [Member] | Commercial and Industrial [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 4,961 | ||
Total LHFI | 3,629 | ' | ||
Non-accrual [Member] | Residential Real Estate [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 994 | ||
Total LHFI | 632 | ' | ||
Non-accrual [Member] | Multi Family [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 0 | ||
Total LHFI | 0 | ' | ||
Non-accrual [Member] | Leases [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 251 | ||
Total LHFI | 467 | ' | ||
Non-accrual [Member] | Tax Certificates [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 601 | ||
Total LHFI | 454 | ' | ||
Non-accrual [Member] | Consumer Portfolio Segment [Member] | ' | ' | ||
Risk Ratings for Each Loan Portfolio Segment [Abstract] | ' | ' | ||
Subtotal LHFI | ' | 0 | ||
Total LHFI | $0 | ' | ||
[1] | For the 2013 period net deferred fees were allocated among the various loan types. |
LOANS_AND_LEASES_Aging_Analysi
LOANS AND LEASES - Aging Analysis of Past Due Payments for Each Loan Portfolio Segment (Details) (USD $) | 12 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2012 | |||
Aging analysis of past due payments for each loan portfolio segment [Abstract] | ' | ' | ||
30-59 Days Past Due | $2,054,000 | $2,635,000 | ||
60-89 Days Past Due | 558,000 | 1,988,000 | ||
Accruing 90+Days | 0 | 0 | ||
Total non-accrual LHFI, loan balance | 10,157,000 | 23,004,000 | ||
Current | 353,712,000 | 318,627,000 | ||
Subtotal LHFI | 366,481,000 | 344,682,000 | ||
Less: Deferred loan fees | 0 | [1] | -517,000 | [1] |
Total LHFI | 366,481,000 | 344,165,000 | ||
Non-accrual loans held for investment [Abstract] | ' | ' | ||
Total non-accrual LHFI, loan balance | 10,157,000 | 21,432,000 | ||
Total non-accrual LHFI, Specific reserves | 886,000 | 2,026,000 | ||
Non-accrual loans held for sale [Abstract] | ' | ' | ||
Total non-accrual LHFS, Loan balance | 0 | 1,572,000 | ||
Non accrual loans held for sale, Specific reserves | 0 | 0 | ||
Total non-accrual loans, Loan balance | 10,157,000 | 23,004,000 | ||
Total non-accrual LHFI, Specific reserves | 886,000 | 2,026,000 | ||
Period decrease in nonaccrual loans | 12,800,000 | ' | ||
Reduction in existing non accrual loan balances | 13,200,000 | ' | ||
Transfer to other real estate owned | 9,051,000 | 10,811,000 | ||
Charge-offs to the allowance for loan and lease losses | 4,000,000 | ' | ||
Addition of non accrual loan balance | 13,500,000 | ' | ||
Interest income lost on non-accrual loans | 1,700,000 | 3,100,000 | ||
Cash collected on non accrual and impaired loan | 16,100,000 | 23,400,000 | ||
Amount credited to principal balance outstanding | 15,300,000 | 21,100,000 | ||
Summary of impaired loans [Abstract] | ' | ' | ||
Impaired LHFI with a valuation allowance | 3,835,000 | 9,405,000 | ||
Impaired LHFI without a valuation allowance | 14,671,000 | 19,423,000 | ||
Impaired LHFS | 0 | 1,572,000 | ||
Total impaired loans and leases | 18,506,000 | 30,400,000 | ||
Valuation allowance related to impaired LHFI | 886,000 | 2,026,000 | ||
Average Recorded Investment and Related Interest Income [Abstract] | ' | ' | ||
Average investment in impaired loans and leases | 24,714,000 | 39,412,000 | ||
Interest income recognized on impaired loans and leases | 559,000 | 366,000 | ||
Interest income recognized on a cash basis on impaired loans and leases | 27,000 | 66,000 | ||
Construction and Land Development [Member] | ' | ' | ||
Aging analysis of past due payments for each loan portfolio segment [Abstract] | ' | ' | ||
30-59 Days Past Due | 0 | 0 | ||
60-89 Days Past Due | 0 | 0 | ||
Accruing 90+Days | 0 | 0 | ||
Total non-accrual LHFI, loan balance | 2,650,000 | 4,280,000 | ||
Current | 42,611,000 | 32,935,000 | ||
Subtotal LHFI | 45,261,000 | 37,215,000 | ||
Total LHFI | 45,261,000 | ' | ||
Non-accrual loans held for investment [Abstract] | ' | ' | ||
Total non-accrual LHFI, loan balance | 2,650,000 | 4,280,000 | ||
Total non-accrual LHFI, Specific reserves | 0 | 820,000 | ||
Non-accrual loans held for sale [Abstract] | ' | ' | ||
Total non-accrual loans, Loan balance | 2,650,000 | 4,280,000 | ||
Total non-accrual LHFI, Specific reserves | 0 | 820,000 | ||
Percentage of outstanding non-accrual loans (in hundredths) | 26.00% | ' | ||
Summary of impaired loans [Abstract] | ' | ' | ||
Valuation allowance related to impaired LHFI | 0 | 820,000 | ||
Commercial Real Estate [Member] | ' | ' | ||
Aging analysis of past due payments for each loan portfolio segment [Abstract] | ' | ' | ||
30-59 Days Past Due | 996,000 | 1,548,000 | ||
60-89 Days Past Due | 0 | 1,486,000 | ||
Accruing 90+Days | 0 | 0 | ||
Total non-accrual LHFI, loan balance | 2,325,000 | 10,345,000 | ||
Current | 144,972,000 | 153,736,000 | ||
Subtotal LHFI | ' | 167,115,000 | ||
Total LHFI | 148,293,000 | ' | ||
Non-accrual loans held for investment [Abstract] | ' | ' | ||
Total non-accrual LHFI, loan balance | 2,325,000 | 10,345,000 | ||
Total non-accrual LHFI, Specific reserves | 331,000 | 835,000 | ||
Non-accrual loans held for sale [Abstract] | ' | ' | ||
Total non-accrual LHFS, Loan balance | 0 | 1,572,000 | ||
Non accrual loans held for sale, Specific reserves | 0 | 0 | ||
Total non-accrual loans, Loan balance | 2,325,000 | 10,345,000 | ||
Total non-accrual LHFI, Specific reserves | 331,000 | 835,000 | ||
Percentage of outstanding non-accrual loans (in hundredths) | 23.00% | ' | ||
Summary of impaired loans [Abstract] | ' | ' | ||
Valuation allowance related to impaired LHFI | 331,000 | 835,000 | ||
Commercial and Industrial [Member] | ' | ' | ||
Aging analysis of past due payments for each loan portfolio segment [Abstract] | ' | ' | ||
30-59 Days Past Due | 115,000 | 200,000 | ||
60-89 Days Past Due | 49,000 | 0 | ||
Accruing 90+Days | 0 | 0 | ||
Total non-accrual LHFI, loan balance | 3,629,000 | 4,961,000 | ||
Current | 75,796,000 | 35,399,000 | ||
Subtotal LHFI | ' | 40,560,000 | ||
Total LHFI | 79,589,000 | ' | ||
Non-accrual loans held for investment [Abstract] | ' | ' | ||
Total non-accrual LHFI, loan balance | 3,629,000 | 4,961,000 | ||
Total non-accrual LHFI, Specific reserves | 452,000 | 255,000 | ||
Non-accrual loans held for sale [Abstract] | ' | ' | ||
Total non-accrual loans, Loan balance | 3,629,000 | 4,961,000 | ||
Total non-accrual LHFI, Specific reserves | 452,000 | 255,000 | ||
Percentage of outstanding non-accrual loans (in hundredths) | 36.00% | ' | ||
Summary of impaired loans [Abstract] | ' | ' | ||
Valuation allowance related to impaired LHFI | 452,000 | 255,000 | ||
Residential Real Estate [Member] | ' | ' | ||
Aging analysis of past due payments for each loan portfolio segment [Abstract] | ' | ' | ||
30-59 Days Past Due | 458,000 | 562,000 | ||
60-89 Days Past Due | 262,000 | 486,000 | ||
Accruing 90+Days | 0 | 0 | ||
Total non-accrual LHFI, loan balance | 632,000 | 994,000 | ||
Current | 24,183,000 | 22,939,000 | ||
Subtotal LHFI | ' | 24,981,000 | ||
Total LHFI | 25,535,000 | ' | ||
Non-accrual loans held for investment [Abstract] | ' | ' | ||
Total non-accrual LHFI, loan balance | 632,000 | 994,000 | ||
Total non-accrual LHFI, Specific reserves | 19,000 | 14,000 | ||
Non-accrual loans held for sale [Abstract] | ' | ' | ||
Total non-accrual loans, Loan balance | 632,000 | 994,000 | ||
Total non-accrual LHFI, Specific reserves | 19,000 | 14,000 | ||
Summary of impaired loans [Abstract] | ' | ' | ||
Valuation allowance related to impaired LHFI | 19,000 | 14,000 | ||
Multi Family [Member] | ' | ' | ||
Aging analysis of past due payments for each loan portfolio segment [Abstract] | ' | ' | ||
30-59 Days Past Due | 0 | 0 | ||
60-89 Days Past Due | 0 | 0 | ||
Accruing 90+Days | 0 | 0 | ||
Total non-accrual LHFI, loan balance | 0 | 0 | ||
Current | 11,737,000 | 11,756,000 | ||
Subtotal LHFI | 11,737,000 | 11,756,000 | ||
Total LHFI | 11,737,000 | ' | ||
Non-accrual loans held for sale [Abstract] | ' | ' | ||
Total non-accrual loans, Loan balance | 0 | 0 | ||
Leases [Member] | ' | ' | ||
Aging analysis of past due payments for each loan portfolio segment [Abstract] | ' | ' | ||
30-59 Days Past Due | 485,000 | 325,000 | ||
60-89 Days Past Due | 247,000 | 16,000 | ||
Accruing 90+Days | 0 | 0 | ||
Total non-accrual LHFI, loan balance | 467,000 | 251,000 | ||
Current | 41,325,000 | 36,755,000 | ||
Subtotal LHFI | 42,524,000 | 37,347,000 | ||
Total LHFI | 42,524,000 | ' | ||
Non-accrual loans held for investment [Abstract] | ' | ' | ||
Total non-accrual LHFI, loan balance | 467,000 | 251,000 | ||
Total non-accrual LHFI, Specific reserves | 60,000 | 55,000 | ||
Non-accrual loans held for sale [Abstract] | ' | ' | ||
Total non-accrual loans, Loan balance | 467,000 | 251,000 | ||
Total non-accrual LHFI, Specific reserves | 60,000 | 55,000 | ||
Summary of impaired loans [Abstract] | ' | ' | ||
Valuation allowance related to impaired LHFI | 60,000 | 55,000 | ||
Tax Certificates [Member] | ' | ' | ||
Aging analysis of past due payments for each loan portfolio segment [Abstract] | ' | ' | ||
30-59 Days Past Due | 0 | 0 | ||
60-89 Days Past Due | 0 | 0 | ||
Accruing 90+Days | 0 | 0 | ||
Total non-accrual LHFI, loan balance | 454,000 | 601,000 | ||
Current | 12,262,000 | 23,968,000 | ||
Subtotal LHFI | 12,716,000 | 24,569,000 | ||
Total LHFI | 12,716,000 | ' | ||
Non-accrual loans held for investment [Abstract] | ' | ' | ||
Total non-accrual LHFI, loan balance | 454,000 | 601,000 | ||
Total non-accrual LHFI, Specific reserves | 24,000 | 47,000 | ||
Non-accrual loans held for sale [Abstract] | ' | ' | ||
Total non-accrual loans, Loan balance | 454,000 | 601,000 | ||
Total non-accrual LHFI, Specific reserves | 24,000 | 47,000 | ||
Summary of impaired loans [Abstract] | ' | ' | ||
Valuation allowance related to impaired LHFI | 24,000 | 47,000 | ||
Consumer [Member] | ' | ' | ||
Aging analysis of past due payments for each loan portfolio segment [Abstract] | ' | ' | ||
30-59 Days Past Due | 0 | 0 | ||
60-89 Days Past Due | 0 | 0 | ||
Accruing 90+Days | 0 | 0 | ||
Total non-accrual LHFI, loan balance | 0 | 0 | ||
Current | 826,000 | 1,139,000 | ||
Subtotal LHFI | 826,000 | 1,139,000 | ||
Total LHFI | 826,000 | ' | ||
Non-accrual loans held for sale [Abstract] | ' | ' | ||
Total non-accrual loans, Loan balance | $0 | $0 | ||
[1] | For the 2013 period net deferred fees were allocated among the various loan types. |
LOANS_AND_LEASES_Troubled_Debt
LOANS AND LEASES - Troubled Debt Restructurings (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Loan | Loan | |
LOANS AND LEASES [Abstract] | ' | ' |
TDRs, total carrying value | $12,084 | $21,090 |
Financing Receivable, Modifications [Line Items] | ' | ' |
Number of TDRs on non-accrual status | 5 | 8 |
Number of TDRs already classified as impaired | 5 | 8 |
Number of Loans | 12 | 12 |
Total TDRs | 12,084 | 21,090 |
Financing Receivable New Modifications for the Period [Abstract] | ' | ' |
Number of loans | 3 | 4 |
Rate | 0 | 0 |
Term | 0 | 0 |
Payment | 0 | 5,290 |
Combination of types | 3,787 | 7,906 |
Total | 3,787 | 13,196 |
Pre-Modification Outstanding Recorded Investment | 3,848 | 15,006 |
Post-Modification Outstanding Recorded Investment | 3,848 | 15,006 |
Accrual Status [Member] | ' | ' |
LOANS AND LEASES [Abstract] | ' | ' |
TDRs, total carrying value | 9,524 | 7,567 |
Financing Receivable, Modifications [Line Items] | ' | ' |
Total TDRs | 9,524 | 7,567 |
Non-Accrual Status [Member] | ' | ' |
LOANS AND LEASES [Abstract] | ' | ' |
TDRs, total carrying value | 2,560 | 13,523 |
Financing Receivable, Modifications [Line Items] | ' | ' |
Total TDRs | 2,560 | 13,523 |
Construction and Land Development [Member] | ' | ' |
LOANS AND LEASES [Abstract] | ' | ' |
TDRs, total carrying value | 1,736 | 10,676 |
Financing Receivable, Modifications [Line Items] | ' | ' |
Number of Loans | 4 | 4 |
Total TDRs | 1,736 | 10,676 |
Financing Receivable New Modifications for the Period [Abstract] | ' | ' |
Number of loans | ' | 1 |
Rate | ' | 0 |
Term | ' | 0 |
Payment | ' | 0 |
Combination of types | ' | 282 |
Total | ' | 282 |
Pre-Modification Outstanding Recorded Investment | ' | 290 |
Post-Modification Outstanding Recorded Investment | ' | 290 |
Construction and Land Development [Member] | Accrual Status [Member] | ' | ' |
LOANS AND LEASES [Abstract] | ' | ' |
TDRs, total carrying value | 1,257 | 613 |
Financing Receivable, Modifications [Line Items] | ' | ' |
Total TDRs | 1,257 | 613 |
Construction and Land Development [Member] | Non-Accrual Status [Member] | ' | ' |
LOANS AND LEASES [Abstract] | ' | ' |
TDRs, total carrying value | 479 | 10,063 |
Financing Receivable, Modifications [Line Items] | ' | ' |
Total TDRs | 479 | 10,063 |
Commercial Real Estate [Member] | ' | ' |
LOANS AND LEASES [Abstract] | ' | ' |
TDRs, total carrying value | 3,847 | 2,518 |
Financing Receivable, Modifications [Line Items] | ' | ' |
Number of Loans | 3 | 4 |
Total TDRs | 3,847 | 2,518 |
Financing Receivable New Modifications for the Period [Abstract] | ' | ' |
Number of loans | 2 | 2 |
Rate | 0 | 0 |
Term | 0 | 0 |
Payment | 0 | 0 |
Combination of types | 3,705 | 7,624 |
Total | 3,705 | 7,624 |
Pre-Modification Outstanding Recorded Investment | 3,761 | 9,426 |
Post-Modification Outstanding Recorded Investment | 3,761 | 9,426 |
Commercial Real Estate [Member] | Accrual Status [Member] | ' | ' |
LOANS AND LEASES [Abstract] | ' | ' |
TDRs, total carrying value | 3,847 | 1,664 |
Financing Receivable, Modifications [Line Items] | ' | ' |
Total TDRs | 3,847 | 1,664 |
Commercial Real Estate [Member] | Non-Accrual Status [Member] | ' | ' |
LOANS AND LEASES [Abstract] | ' | ' |
TDRs, total carrying value | 0 | 854 |
Financing Receivable, Modifications [Line Items] | ' | ' |
Total TDRs | 0 | 854 |
Commercial and Industrial [Member] | ' | ' |
LOANS AND LEASES [Abstract] | ' | ' |
TDRs, total carrying value | 6,380 | 7,747 |
Financing Receivable, Modifications [Line Items] | ' | ' |
Number of Loans | 3 | 2 |
Total TDRs | 6,380 | 7,747 |
Financing Receivable New Modifications for the Period [Abstract] | ' | ' |
Number of loans | 1 | 1 |
Rate | 0 | 0 |
Term | 0 | 0 |
Payment | 0 | 5,290 |
Combination of types | 82 | 0 |
Total | 82 | 5,290 |
Pre-Modification Outstanding Recorded Investment | 87 | 5,290 |
Post-Modification Outstanding Recorded Investment | 87 | 5,290 |
Commercial and Industrial [Member] | Accrual Status [Member] | ' | ' |
LOANS AND LEASES [Abstract] | ' | ' |
TDRs, total carrying value | 4,420 | 5,290 |
Financing Receivable, Modifications [Line Items] | ' | ' |
Total TDRs | 4,420 | 5,290 |
Commercial and Industrial [Member] | Non-Accrual Status [Member] | ' | ' |
LOANS AND LEASES [Abstract] | ' | ' |
TDRs, total carrying value | 1,960 | 2,457 |
Financing Receivable, Modifications [Line Items] | ' | ' |
Total TDRs | 1,960 | 2,457 |
Residential Real Estate [Member] | ' | ' |
LOANS AND LEASES [Abstract] | ' | ' |
TDRs, total carrying value | 121 | 149 |
Financing Receivable, Modifications [Line Items] | ' | ' |
Number of Loans | 2 | 2 |
Total TDRs | 121 | 149 |
Residential Real Estate [Member] | Accrual Status [Member] | ' | ' |
LOANS AND LEASES [Abstract] | ' | ' |
TDRs, total carrying value | 0 | 0 |
Financing Receivable, Modifications [Line Items] | ' | ' |
Total TDRs | 0 | 0 |
Residential Real Estate [Member] | Non-Accrual Status [Member] | ' | ' |
LOANS AND LEASES [Abstract] | ' | ' |
TDRs, total carrying value | 121 | 149 |
Financing Receivable, Modifications [Line Items] | ' | ' |
Total TDRs | $121 | $149 |
ALLOWANCE_FOR_LOAN_AND_LEASE_L2
ALLOWANCE FOR LOAN AND LEASE LOSSES - Changes in Allowance for Loan and Lease Losses (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Allowance for Loan and Leases Losses [Roll Forward] | ' | ' |
Beginning balance | $17,261 | $16,380 |
Charge-offs | -3,893 | -6,271 |
Recoveries | 1,175 | 1,155 |
(Credit) provision | -872 | 5,997 |
Ending balance | 13,671 | 17,261 |
Ending balance: related to loans individually evaluated for impairment | 886 | 2,026 |
Ending balance: related to loans collectively evaluated for impairment | 12,785 | 15,235 |
LHFI [Abstract] | ' | ' |
Ending balance | 366,481 | 344,682 |
Ending balance: individually evaluated for impairment | 18,506 | 28,828 |
Ending balance: collectively evaluated for impairment | 347,975 | 315,854 |
Commercial Real Estate [Member] | ' | ' |
Allowance for Loan and Leases Losses [Roll Forward] | ' | ' |
Beginning balance | 8,750 | 7,744 |
Charge-offs | -1,684 | -1,313 |
Recoveries | 600 | 3 |
(Credit) provision | -2,168 | 2,316 |
Ending balance | 5,498 | 8,750 |
Ending balance: related to loans individually evaluated for impairment | 331 | 835 |
Ending balance: related to loans collectively evaluated for impairment | 5,167 | 7,915 |
LHFI [Abstract] | ' | ' |
Ending balance | 148,293 | 167,115 |
Ending balance: individually evaluated for impairment | 5,325 | 10,958 |
Ending balance: collectively evaluated for impairment | 142,968 | 156,157 |
Construction and Land Development [Member] | ' | ' |
Allowance for Loan and Leases Losses [Roll Forward] | ' | ' |
Beginning balance | 2,987 | 2,523 |
Charge-offs | -820 | -2,452 |
Recoveries | 297 | 816 |
(Credit) provision | -148 | 2,100 |
Ending balance | 2,316 | 2,987 |
Ending balance: related to loans individually evaluated for impairment | 0 | 820 |
Ending balance: related to loans collectively evaluated for impairment | 2,316 | 2,167 |
LHFI [Abstract] | ' | ' |
Ending balance | 45,261 | 37,215 |
Ending balance: individually evaluated for impairment | 3,907 | 5,943 |
Ending balance: collectively evaluated for impairment | 41,354 | 31,272 |
Commercial and Industrial [Member] | ' | ' |
Allowance for Loan and Leases Losses [Roll Forward] | ' | ' |
Beginning balance | 1,924 | 2,331 |
Charge-offs | -383 | -586 |
Recoveries | 17 | 67 |
(Credit) provision | 1,448 | 112 |
Ending balance | 3,006 | 1,924 |
Ending balance: related to loans individually evaluated for impairment | 452 | 255 |
Ending balance: related to loans collectively evaluated for impairment | 2,554 | 1,669 |
LHFI [Abstract] | ' | ' |
Ending balance | 79,589 | 40,560 |
Ending balance: individually evaluated for impairment | 8,049 | 10,251 |
Ending balance: collectively evaluated for impairment | 71,540 | 30,309 |
Multi Family [Member] | ' | ' |
Allowance for Loan and Leases Losses [Roll Forward] | ' | ' |
Beginning balance | 654 | 531 |
Charge-offs | 0 | -542 |
Recoveries | 0 | 0 |
(Credit) provision | -252 | 665 |
Ending balance | 402 | 654 |
Ending balance: related to loans individually evaluated for impairment | 0 | 0 |
Ending balance: related to loans collectively evaluated for impairment | 402 | 654 |
LHFI [Abstract] | ' | ' |
Ending balance | 11,737 | 11,756 |
Ending balance: individually evaluated for impairment | 0 | 0 |
Ending balance: collectively evaluated for impairment | 11,737 | 11,756 |
Residential Portfolio Segment [Member] | ' | ' |
Allowance for Loan and Leases Losses [Roll Forward] | ' | ' |
Beginning balance | 1,098 | 1,188 |
Charge-offs | -46 | -111 |
Recoveries | 158 | 208 |
(Credit) provision | -737 | -187 |
Ending balance | 473 | 1,098 |
Ending balance: related to loans individually evaluated for impairment | 19 | 14 |
Ending balance: related to loans collectively evaluated for impairment | 454 | 1,084 |
LHFI [Abstract] | ' | ' |
Ending balance | 25,535 | 24,981 |
Ending balance: individually evaluated for impairment | 632 | 994 |
Ending balance: collectively evaluated for impairment | 24,903 | 23,987 |
Consumer Portfolio Segment [Member] | ' | ' |
Allowance for Loan and Leases Losses [Roll Forward] | ' | ' |
Beginning balance | 29 | 20 |
Charge-offs | 0 | 0 |
Recoveries | 0 | 0 |
(Credit) provision | -14 | 9 |
Ending balance | 15 | 29 |
Ending balance: related to loans individually evaluated for impairment | 0 | 0 |
Ending balance: related to loans collectively evaluated for impairment | 15 | 29 |
LHFI [Abstract] | ' | ' |
Ending balance | 826 | 1,139 |
Ending balance: individually evaluated for impairment | 0 | 0 |
Ending balance: collectively evaluated for impairment | 826 | 1,139 |
Leases [Member] | ' | ' |
Allowance for Loan and Leases Losses [Roll Forward] | ' | ' |
Beginning balance | 1,108 | 1,311 |
Charge-offs | -382 | -465 |
Recoveries | 29 | 32 |
(Credit) provision | 468 | 230 |
Ending balance | 1,223 | 1,108 |
Ending balance: related to loans individually evaluated for impairment | 60 | 55 |
Ending balance: related to loans collectively evaluated for impairment | 1,163 | 1,053 |
LHFI [Abstract] | ' | ' |
Ending balance | 42,524 | 37,347 |
Ending balance: individually evaluated for impairment | 139 | 81 |
Ending balance: collectively evaluated for impairment | 42,385 | 37,266 |
Tax Certificates [Member] | ' | ' |
Allowance for Loan and Leases Losses [Roll Forward] | ' | ' |
Beginning balance | 472 | 425 |
Charge-offs | -578 | -802 |
Recoveries | 74 | 29 |
(Credit) provision | 587 | 820 |
Ending balance | 555 | 472 |
Ending balance: related to loans individually evaluated for impairment | 24 | 47 |
Ending balance: related to loans collectively evaluated for impairment | 531 | 425 |
LHFI [Abstract] | ' | ' |
Ending balance | 12,716 | 24,569 |
Ending balance: individually evaluated for impairment | 454 | 601 |
Ending balance: collectively evaluated for impairment | 12,262 | 23,968 |
Unallocated [Member] | ' | ' |
Allowance for Loan and Leases Losses [Roll Forward] | ' | ' |
Beginning balance | 239 | 307 |
Charge-offs | 0 | 0 |
Recoveries | 0 | 0 |
(Credit) provision | -56 | -68 |
Ending balance | 183 | 239 |
Ending balance: related to loans individually evaluated for impairment | 0 | 0 |
Ending balance: related to loans collectively evaluated for impairment | 183 | 239 |
LHFI [Abstract] | ' | ' |
Ending balance | 0 | 0 |
Ending balance: individually evaluated for impairment | 0 | 0 |
Ending balance: collectively evaluated for impairment | $0 | $0 |
ALLOWANCE_FOR_LOAN_AND_LEASE_L3
ALLOWANCE FOR LOAN AND LEASE LOSSES - Loans that were Evaluated for Impairment by Loan Segment (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Unpaid principal balance [Abstract] | ' | ' |
With no related allowance recorded | $21,151 | $25,029 |
With an allowance recorded | 9,315 | 25,075 |
Recorded investment [Abstract] | ' | ' |
With no related allowance recorded | 14,671 | 19,423 |
With an allowance recorded | 3,835 | 9,405 |
Related allowance [Abstract] | ' | ' |
Related allowance | 886 | 2,026 |
Average recorded investment [Abstract] | ' | ' |
With no related allowance recorded | 18,100 | 28,620 |
With an allowance recorded | 5,655 | 4,602 |
Interest income recognized [Abstract] | ' | ' |
With no related allowance recorded | 559 | 359 |
With an allowance recorded | 0 | 7 |
Construction and Land Development [Member] | ' | ' |
Unpaid principal balance [Abstract] | ' | ' |
With no related allowance recorded | 9,850 | 6,250 |
With an allowance recorded | 0 | 6,180 |
Recorded investment [Abstract] | ' | ' |
With no related allowance recorded | 3,907 | 3,464 |
With an allowance recorded | 0 | 2,479 |
Related allowance [Abstract] | ' | ' |
Related allowance | 0 | 820 |
Average recorded investment [Abstract] | ' | ' |
With no related allowance recorded | 3,933 | 10,059 |
With an allowance recorded | 381 | 923 |
Interest income recognized [Abstract] | ' | ' |
With no related allowance recorded | 209 | 187 |
With an allowance recorded | 0 | 0 |
Commercial Real Estate [Member] | ' | ' |
Unpaid principal balance [Abstract] | ' | ' |
With no related allowance recorded | 4,429 | 10,417 |
With an allowance recorded | 1,435 | 4,136 |
Recorded investment [Abstract] | ' | ' |
With no related allowance recorded | 4,158 | 8,623 |
With an allowance recorded | 1,435 | 2,335 |
Related allowance [Abstract] | ' | ' |
Related allowance | 331 | 835 |
Average recorded investment [Abstract] | ' | ' |
With no related allowance recorded | 7,956 | 11,163 |
With an allowance recorded | 1,879 | 1,526 |
Interest income recognized [Abstract] | ' | ' |
With no related allowance recorded | 73 | 78 |
With an allowance recorded | 0 | 0 |
Commercial and Industrial [Member] | ' | ' |
Unpaid principal balance [Abstract] | ' | ' |
With no related allowance recorded | 6,693 | 7,790 |
With an allowance recorded | 2,592 | 9,585 |
Recorded investment [Abstract] | ' | ' |
With no related allowance recorded | 6,491 | 6,820 |
With an allowance recorded | 1,290 | 3,431 |
Related allowance [Abstract] | ' | ' |
Related allowance | 452 | 255 |
Average recorded investment [Abstract] | ' | ' |
With no related allowance recorded | 5,960 | 5,545 |
With an allowance recorded | 2,456 | 682 |
Interest income recognized [Abstract] | ' | ' |
With no related allowance recorded | 250 | 73 |
With an allowance recorded | 0 | 0 |
Residential Real Estate [Member] | ' | ' |
Unpaid principal balance [Abstract] | ' | ' |
With no related allowance recorded | 0 | 572 |
With an allowance recorded | 827 | 685 |
Recorded investment [Abstract] | ' | ' |
With no related allowance recorded | 0 | 516 |
With an allowance recorded | 631 | 478 |
Related allowance [Abstract] | ' | ' |
Related allowance | 19 | 14 |
Average recorded investment [Abstract] | ' | ' |
With no related allowance recorded | 84 | 490 |
With an allowance recorded | 492 | 714 |
Interest income recognized [Abstract] | ' | ' |
With no related allowance recorded | 27 | 21 |
With an allowance recorded | 0 | 7 |
Multi Family [Member] | ' | ' |
Unpaid principal balance [Abstract] | ' | ' |
With no related allowance recorded | ' | 0 |
With an allowance recorded | ' | 0 |
Recorded investment [Abstract] | ' | ' |
With no related allowance recorded | ' | 0 |
With an allowance recorded | ' | 0 |
Related allowance [Abstract] | ' | ' |
Related allowance | ' | 0 |
Average recorded investment [Abstract] | ' | ' |
With no related allowance recorded | ' | 780 |
With an allowance recorded | ' | 383 |
Interest income recognized [Abstract] | ' | ' |
With no related allowance recorded | ' | 0 |
With an allowance recorded | ' | 0 |
Leases [Member] | ' | ' |
Unpaid principal balance [Abstract] | ' | ' |
With an allowance recorded | 139 | 81 |
Recorded investment [Abstract] | ' | ' |
With an allowance recorded | 139 | 81 |
Related allowance [Abstract] | ' | ' |
Related allowance | 60 | 55 |
Average recorded investment [Abstract] | ' | ' |
With an allowance recorded | 106 | 86 |
Interest income recognized [Abstract] | ' | ' |
With an allowance recorded | 0 | 0 |
Tax Certificates [Member] | ' | ' |
Unpaid principal balance [Abstract] | ' | ' |
With no related allowance recorded | 179 | 0 |
With an allowance recorded | 4,322 | 4,408 |
Recorded investment [Abstract] | ' | ' |
With no related allowance recorded | 115 | 0 |
With an allowance recorded | 340 | 601 |
Related allowance [Abstract] | ' | ' |
Related allowance | 24 | 47 |
Average recorded investment [Abstract] | ' | ' |
With no related allowance recorded | 167 | 583 |
With an allowance recorded | 341 | 288 |
Interest income recognized [Abstract] | ' | ' |
With no related allowance recorded | 0 | 0 |
With an allowance recorded | $0 | $0 |
OTHER_REAL_ESTATE_OWNED_Detail
OTHER REAL ESTATE OWNED (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Property | ||
OTHER REAL ESTATE OWNED [Abstract] | ' | ' |
Other real estate owned decrease | $3,800,000 | ' |
Foreclosed Property [Roll Forward] | ' | ' |
Beginning balance | 13,435,000 | ' |
Net proceeds from sales | -12,779,000 | -12,014,000 |
Net gain on sales | 1,427,000 | 363,000 |
Assets acquired on non-accrual loans | 9,051,000 | 10,811,000 |
Impairment charge | -1,517,000 | -6,741,000 |
Ending balance | 9,617,000 | 13,435,000 |
Other real estate owned (OREO) | 9,617,000 | 13,435,000 |
Number of properties sold | 4 | ' |
Proceeds from sale of collateral related to loans or other real estate owned | 12,779,000 | 12,014,000 |
Gain (loss) on sale of OREO | 1,427,000 | 363,000 |
Impairment charge for other real estate owned | 1,517,000 | 6,741,000 |
Land [Member] | ' | ' |
Foreclosed Property [Roll Forward] | ' | ' |
Net proceeds from sales | -6,000,000 | ' |
Net gain on sales | -194,000 | ' |
Impairment charge | -628,000 | ' |
Ending balance | 769,000 | ' |
Other real estate owned (OREO) | 769,000 | ' |
Number of properties sold | 5 | ' |
Proceeds from sale of collateral related to loans or other real estate owned | 6,000,000 | ' |
Gain (loss) on sale of OREO | -194,000 | ' |
Impairment charge for other real estate owned | 628,000 | ' |
Number of properties impaired | 3 | ' |
Commercial Real Estate [Member] | ' | ' |
Foreclosed Property [Roll Forward] | ' | ' |
Net proceeds from sales | -2,500,000 | ' |
Net gain on sales | 262,000 | ' |
Impairment charge | -325,000 | ' |
Ending balance | 521,000 | ' |
Other real estate owned (OREO) | 521,000 | ' |
Proceeds from sale of collateral related to loans or other real estate owned | 2,500,000 | ' |
Gain (loss) on sale of OREO | 262,000 | ' |
Impairment charge for other real estate owned | 325,000 | ' |
Single family homes [Member] | ' | ' |
Foreclosed Property [Roll Forward] | ' | ' |
Net proceeds from sales | -330,000 | ' |
Net gain on sales | 160,000 | ' |
Impairment charge | -146,000 | ' |
Ending balance | 435,000 | ' |
Other real estate owned (OREO) | 435,000 | ' |
Number of properties sold | 42 | ' |
Proceeds from sale of collateral related to loans or other real estate owned | 330,000 | ' |
Gain (loss) on sale of OREO | 160,000 | ' |
Impairment charge for other real estate owned | 146,000 | ' |
Number of lending relationships | 5 | ' |
Loan [Member] | ' | ' |
Foreclosed Property [Roll Forward] | ' | ' |
Beginning balance | 11,365,000 | ' |
Net proceeds from sales | -8,869,000 | ' |
Net gain on sales | 228,000 | ' |
Assets acquired on non-accrual loans | 100,000 | ' |
Impairment charge | -1,099,000 | ' |
Ending balance | 1,725,000 | ' |
Other real estate owned (OREO) | 1,725,000 | ' |
Proceeds from sale of collateral related to loans or other real estate owned | 8,869,000 | ' |
Gain (loss) on sale of OREO | 228,000 | ' |
Impairment charge for other real estate owned | 1,099,000 | ' |
Tax Lien [Member] | ' | ' |
Foreclosed Property [Roll Forward] | ' | ' |
Beginning balance | 2,070,000 | ' |
Net proceeds from sales | -3,910,000 | ' |
Net gain on sales | 1,199,000 | ' |
Assets acquired on non-accrual loans | 8,951,000 | ' |
Impairment charge | -418,000 | ' |
Ending balance | 7,892,000 | 2,070,000 |
Other real estate owned (OREO) | 7,892,000 | 2,070,000 |
Number of properties sold | 49 | ' |
Proceeds from sale of collateral related to loans or other real estate owned | 3,910,000 | ' |
Gain (loss) on sale of OREO | 1,199,000 | ' |
Impairment charge for other real estate owned | 418,000 | ' |
Transfer to other real estate owned | $9,000,000 | $2,100,000 |
Number of properties transferred to OREO | 84 | 30 |
PREMISES_AND_EQUIPMENT_Details
PREMISES AND EQUIPMENT (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Property | ||
Premises and Equipment [Line Items] | ' | ' |
Premises and equipment | $15,431,000 | $16,617,000 |
Less accumulated depreciation and amortization | -10,956,000 | -11,385,000 |
Premises and equipment, net | 4,475,000 | 5,232,000 |
Depreciation and amortization expense | 451,000 | 417,000 |
Number of properties sold | 4 | ' |
Carrying value of property sold | 674,000 | ' |
Gain (loss) on sale of property | 2,500,000 | ' |
Land [Member] | ' | ' |
Premises and Equipment [Line Items] | ' | ' |
Premises and equipment | 2,200,000 | 2,396,000 |
Building and Leasehold Improvements [Member] | ' | ' |
Premises and Equipment [Line Items] | ' | ' |
Premises and equipment | 6,225,000 | 7,554,000 |
Building and Leasehold Improvements [Member] | Minimum [Member] | ' | ' |
Premises and Equipment [Line Items] | ' | ' |
Estimated Useful Lives | '5 years | ' |
Building and Leasehold Improvements [Member] | Maximum [Member] | ' | ' |
Premises and Equipment [Line Items] | ' | ' |
Estimated Useful Lives | '39 years | ' |
Furniture, Fixtures and Equipment [Member] | ' | ' |
Premises and Equipment [Line Items] | ' | ' |
Premises and equipment | $7,006,000 | $6,667,000 |
Furniture, Fixtures and Equipment [Member] | Minimum [Member] | ' | ' |
Premises and Equipment [Line Items] | ' | ' |
Estimated Useful Lives | '3 years | ' |
Furniture, Fixtures and Equipment [Member] | Maximum [Member] | ' | ' |
Premises and Equipment [Line Items] | ' | ' |
Estimated Useful Lives | '7 years | ' |
LEASE_COMMITMENTS_Details
LEASE COMMITMENTS (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Store | ||
Minimum rental commitments under the leases | ' | ' |
Lease expiration date | 31-Dec-24 | ' |
2014 | $858,000 | ' |
2015 | 874,000 | ' |
2016 | 886,000 | ' |
2017 | 860,000 | ' |
2018 | 818,000 | ' |
Thereafter | 2,070,000 | ' |
Total lease commitments | 6,366,000 | ' |
Rent expense | $785,000 | $795,000 |
Number of retail offices relocated | 2 | ' |
Option to extend lease period minimum | '1 year | ' |
Option to extend lease period maximum | '10 years | ' |
DEPOSITS_Details
DEPOSITS (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
DEPOSITS [Abstract] | ' | ' |
Demand | $60,473 | $58,531 |
NOW | 45,375 | 43,920 |
Money Market | 164,678 | 179,359 |
Savings | 17,593 | 17,472 |
Time deposits (over $100) | 92,763 | 91,233 |
Time deposits (under $100) | 148,082 | 164,402 |
Total deposits | 528,964 | 554,917 |
Maturities of time deposits for the next five years and thereafter [Abstract] | ' | ' |
2014 | 117,181 | ' |
2015 | 88,948 | ' |
2016 | 11,997 | ' |
2017 | 5,373 | ' |
2018 | 3,204 | ' |
Thereafter | 14,142 | ' |
Total certificates of deposits | $240,845 | ' |
BORROWINGS_AND_SUBORDINATED_DE2
BORROWINGS AND SUBORDINATED DEBENTURES (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | |
Restriction | |||
Advances from Federal Home Loan Banks [Abstract] | ' | ' | ' |
Line of credit with federal home loan bank, amount | $190,000,000 | ' | $150,000,000 |
Number of collateral restrictions removed | 2 | ' | ' |
Federal Home Loan Bank, advances, general debt obligations, disclosures, collateral pledged | 70,400,000 | ' | ' |
Weighted average interest rate (in hundredths) | 1.19% | 2.35% | ' |
Percentage of over collateralized delivery requirement with federal home loan bank (in hundredths) | ' | 105.00% | ' |
Federal Home Loan Bank, advances, activity for year, average balance of agreements outstanding | 64,400,000 | 80,100,000 | ' |
Amount [Abstract] | ' | ' | ' |
Advances maturing in 2013/2014 | 10,000,000 | 50,000,000 | ' |
Advances maturing in 2015 | 10,000,000 | ' | ' |
Advances maturing in 2015/2016 | 10,000,000 | 0 | ' |
Advances maturing in 2016/2017 | 25,000,000 | 0 | ' |
Advances maturing in 2017/2018 | 10,000,000 | 15,000,000 | ' |
Total FHLB borrowings | 65,000,000 | 65,000,000 | ' |
Rate [Abstract] | ' | ' | ' |
Advances maturing in 2013/2014 (in hundredths) | 0.24% | 2.64% | ' |
Advances maturing in 2015 (in hundredths) | 0.71% | ' | ' |
Advances maturing in 2015/2016 (in hundredths) | 1.11% | 0.00% | ' |
Advances maturing in 2016/2017 (in hundredths) | 1.46% | 0.00% | ' |
Advances maturing in 2017/2018 (in hundredths) | 2.01% | 1.39% | ' |
Other borrowings [Abstract] | ' | ' | ' |
Market value of investment securities pledged as collateral | 70,400,000 | ' | ' |
PNC Bank [Member] | ' | ' | ' |
Other borrowings [Abstract] | ' | ' | ' |
Notes payable with PNC Bank | 2,900,000 | 3,300,000 | ' |
Description of variable rate basis on notes payable | 'one month LIBOR | ' | ' |
Basis spread on variable rate on notes payable (in hundredths) | 0.15% | ' | ' |
Interest rate on notes payable (in hundredths) | 0.32% | 0.36% | ' |
Other borrowings from PNC Bank outstanding | 40,000,000 | 40,000,000 | ' |
Weighted average interest rate on other borrowings from PNC Bank (in hundredths) | 3.65% | 3.65% | ' |
Market value of investment securities pledged as collateral | $49,700,000 | ' | ' |
Notes payable [Member] | PNC Bank [Member] | ' | ' | ' |
Other borrowings [Abstract] | ' | ' | ' |
Maturity date of borrowings from PNC Bank | 25-Aug-16 | ' | ' |
Other Borrowings [Member] | PNC Bank [Member] | ' | ' | ' |
Other borrowings [Abstract] | ' | ' | ' |
Maturity date of borrowings from PNC Bank | 7-Jan-18 | ' | ' |
BORROWINGS_AND_SUBORDINATED_DE3
BORROWINGS AND SUBORDINATED DEBENTURES, Subordinated Debentures (Details) (USD $) | 12 Months Ended |
Dec. 31, 2013 | |
Affiliate | |
Subordinated Debentures [Line Items] | ' |
Number of Delaware trust affiliates | 2 |
Interest payment in arrears on trust preferred securities that was paid | $3,100,000 |
Interest penalty on trust preferred securities | 174,000 |
Trust Preferred Securities [Member] | ' |
Subordinated Debentures [Line Items] | ' |
Aggregate principal amount | 25,000,000 |
Description of variable rate basis | '3-month LIBOR |
Trust Preferred Securities [Member] | Trust I [Member] | ' |
Subordinated Debentures [Line Items] | ' |
Aggregate principal amount | 12,500,000 |
Junior subordinated debenture owed to unconsolidated subsidiary trust | 12,900,000 |
Debt securities interest rate (in hundredths) | 2.39% |
Trust preferred securities basis spread on variable rate (in hundredths) | 2.15% |
Trust Preferred Securities [Member] | Trust II [Member] | ' |
Subordinated Debentures [Line Items] | ' |
Aggregate principal amount | 12,500,000 |
Junior subordinated debenture owed to unconsolidated subsidiary trust | 12,900,000 |
Debt securities interest rate (in hundredths) | 2.39% |
Trust preferred securities basis spread on variable rate (in hundredths) | 2.15% |
Common Securities [Member] | Trust I [Member] | ' |
Subordinated Debentures [Line Items] | ' |
Aggregate principal amount | 387,000 |
Common Securities [Member] | Trust II [Member] | ' |
Subordinated Debentures [Line Items] | ' |
Aggregate principal amount | $387,000 |
INCOME_TAXES_Details
INCOME TAXES (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Income Tax Expense [Abstract] | ' | ' |
Current | $42,000 | $0 |
Deferred | 0 | 0 |
Income tax expense | 42,000 | 0 |
Statutory federal income tax rate reconciliation [Abstract] | ' | ' |
Statutory federal income tax rate (in hundredths) | 34.00% | ' |
Computed tax benefit at statutory rate | 731,000 | -5,313,000 |
Tax-exempt income | -22,000 | 42,000 |
Department of Justice fine | 0 | 680,000 |
Nondeductible expense | 21,000 | 29,000 |
Bank owned life insurance | -183,000 | -188,000 |
Adjustment to prior year items | 1,933,000 | 0 |
Increase in valuation allowance | -2,438,000 | 4,834,000 |
Applicable income tax expense | 42,000 | 0 |
Deferred tax assets [Abstract] | ' | ' |
Allowance for loan and lease losses | 4,648,000 | 5,863,000 |
Net operating loss carryforward | 18,908,000 | 21,988,000 |
Asset valuation reserves | 34,000 | 79,000 |
Escrow settlement reserve | 561,000 | 0 |
Security writedowns | 2,193,000 | 1,429,000 |
OREO writedowns | 1,490,000 | 4,475,000 |
Investment in partnerships | 1,805,000 | 34,000 |
Accrued pension liability | 4,926,000 | 5,745,000 |
Unrealized losses on debt securities | 2,171,000 | 0 |
Accrued stock-based compensation | 143,000 | 804,000 |
Non-accrual interest | 134,000 | 277,000 |
Capital loss carryover | 2,892,000 | 1,550,000 |
Charitable contribution carryovers | 14,000 | 11,000 |
Other | 77,000 | 139,000 |
Deferred tax assets before valuation allowance | 39,996,000 | 42,394,000 |
Less valuation allowance | -37,159,000 | -39,597,000 |
Less valuation allowance for equity securities | 0 | 0 |
Total deferred tax assets | 2,837,000 | 2,797,000 |
Deferred tax liabilities [Abstract] | ' | ' |
Penalties on delinquent tax certificates | 39,000 | 224,000 |
Unrealized gains on AFS debt securities | 0 | 1,665,000 |
Unrealized gains on AFS equity securities | 429,000 | 145,000 |
Prepaid deductions | 190,000 | 285,000 |
Other | 8,000 | 64,000 |
Total deferred tax liabilities | 666,000 | 2,383,000 |
Net deferred tax assets, included in other assets | 2,171,000 | 414,000 |
Operating Loss Carryforwards [Line Items] | ' | ' |
Operating loss carryforwards | 51,600,000 | ' |
Tax years subject to examination by various authorities | '2006 through 2007 and 2009 through 2013 | ' |
Minimum [Member] | ' | ' |
Operating Loss Carryforwards [Line Items] | ' | ' |
Operating loss carryforwards, expiration dates | '2030 | ' |
Maximum [Member] | ' | ' |
Operating Loss Carryforwards [Line Items] | ' | ' |
Operating loss carryforwards, expiration dates | '2033 | ' |
Capital Loss Carryforward [Member] | ' | ' |
Operating Loss Carryforwards [Line Items] | ' | ' |
Tax Credit Carryforward, Amount | 8,500,000 | ' |
Capital Loss Carryforward [Member] | Minimum [Member] | ' | ' |
Operating Loss Carryforwards [Line Items] | ' | ' |
Tax Credit Carryforward, Minimum Expiration Date | 31-Dec-14 | ' |
Charitable Contribution Carryovers [Member] | ' | ' |
Operating Loss Carryforwards [Line Items] | ' | ' |
Tax Credit Carryforward, Amount | 42,000 | ' |
Charitable Contribution Carryovers [Member] | Minimum [Member] | ' | ' |
Operating Loss Carryforwards [Line Items] | ' | ' |
Tax Credit Carryforward, Minimum Expiration Date | 31-Dec-14 | ' |
General Business Tax Credit Carryovers [Member] | ' | ' |
Operating Loss Carryforwards [Line Items] | ' | ' |
Tax Credit Carryforward, Amount | 1,000 | ' |
General Business Tax Credit Carryovers [Member] | Minimum [Member] | ' | ' |
Operating Loss Carryforwards [Line Items] | ' | ' |
Tax Credit Carryforward, Minimum Expiration Date | 31-Dec-30 | ' |
Knoblauch State Bank - Available to be utilized [Member] | ' | ' |
Operating Loss Carryforwards [Line Items] | ' | ' |
Operating loss carryforwards | $4,000,000 | ' |
Operating loss carryforwards, expiration dates | '2015 | ' |
FINANCIAL_INSTRUMENTS_WITH_OFF2
FINANCIAL INSTRUMENTS WITH OFF-BALANCE-SHEET RISK AND CONCENTRATIONS OF CREDIT RISK (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Contract amount [Abstract] | ' | ' |
Percentage of collateral held on off balance sheet commitments (in hundredths) | 75.00% | ' |
Open-end Lines of Credit [Member] | ' | ' |
Contract amount [Abstract] | ' | ' |
Financial instruments whose contract amounts represent credit risk | $21,182 | $20,515 |
Commitments to Extend Credit [Member] | ' | ' |
Contract amount [Abstract] | ' | ' |
Financial instruments whose contract amounts represent credit risk | 200 | 24,030 |
Standby Letters of Credit and Financial Guarantees Written [Member] | ' | ' |
Contract amount [Abstract] | ' | ' |
Financial instruments whose contract amounts represent credit risk | $2,679 | $1,199 |
Extension period for guarantees | 'One year | ' |
Guarantees expiry period | 'August 2016 | ' |
LEGAL_CONTINGENCIES_Details
LEGAL CONTINGENCIES (Details) (USD $) | 3 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | ||||
Jun. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Oct. 22, 2012 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2010 | |
LawFirm | CSC [Member] | CSC [Member] | RTL [Member] | Lehman Brothers Holdings, Inc. [Member] | ||||
Equity Method Investments [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of equity interest hold (in hundredths) | ' | ' | ' | ' | ' | 60.00% | 60.00% | ' |
Loss contingency accrual | $1,650,000 | $1,750,000 | $0 | ' | $2,000,000 | ' | ' | ' |
Department of Justice fine in period attributable to parent | 990,000 | ' | ' | ' | 1,200,000 | ' | ' | ' |
Cash payment for liens specified as percentage of redemption amount (in hundredths) | ' | 85.00% | ' | ' | ' | ' | ' | ' |
Payment period from date of written notice | ' | '35 days | ' | ' | ' | ' | ' | ' |
Number of law firms appointed | ' | ' | ' | 2 | ' | ' | ' | ' |
Interest rate on tax liens acquired | ' | 0.00% | ' | ' | ' | ' | ' | ' |
Par value of investment which triggered the legal action triggered by bankruptcy | ' | ' | ' | ' | ' | ' | ' | $25,000,000 |
SHAREHOLDERS_EQUITY_Details
SHAREHOLDERS' EQUITY (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Preferred Stock [Abstract] | ' | ' |
Preferred stock, shares issued (in shares) | 30,407 | 30,407 |
Preferred stock, liquidation value (in dollars per share) | $1,000 | $1,000 |
Common Stock [Abstract] | ' | ' |
Rate class B shares may be converted to class A shares | '1.15 to 1 | ' |
Noncontrolling Interest [Line Items] | ' | ' |
Amount credit to Additional Paid in Capital | $1,550,000 | ' |
Crusader Servicing Corporation [Member] | ' | ' |
Noncontrolling Interest [Line Items] | ' | ' |
Percentage of ownership interest in subsidiary (in hundredths) | ' | 60.00% |
Percentage of relinquished ownership interest (in hundredths) | 20.00% | ' |
Total percentage of ownership interest (in hundredths) | 80.00% | ' |
Royal Tax Lien Services, LLC [Member] | ' | ' |
Noncontrolling Interest [Line Items] | ' | ' |
Percentage of ownership interest in subsidiary (in hundredths) | ' | 60.00% |
Percentage of additional ownership interest acquired (in hundredths) | 40.00% | ' |
Payment for tax distribution related additional ownership interest | 400,000 | ' |
Amount credit to Additional Paid in Capital | 850,000 | ' |
Total percentage of ownership interest (in hundredths) | 100.00% | ' |
Crusader Servicing Corporation and Royal Tax Lien Services, LLC [Member] | ' | ' |
Noncontrolling Interest [Line Items] | ' | ' |
Combined value of ownership interest | 2,600,000 | ' |
Series A Preferred Stock [Member] | ' | ' |
Preferred Stock [Abstract] | ' | ' |
Aggregate purchase price | 30,400,000 | ' |
Preferred stock cumulative dividend rate percentage for first five years (in hundredths) | 5.00% | ' |
Preferred stock cumulative dividend rate percentage for thereafter five years (in hundredths) | 9.00% | ' |
Number of years for warrant issued to treasury | '10 years | ' |
Warrants, exercise price (in dollars per share) | $4.13 | ' |
Payments of Dividends [Abstract] | ' | ' |
Value on which quarterly dividend is suspended | 30,400,000 | ' |
Preferred stock dividend in arrears | $7,700,000 | ' |
Common Class A [Member] | ' | ' |
Preferred Stock [Abstract] | ' | ' |
Number of shares to be purchased by warrant (in shares) | 1,104,370 | ' |
Common Stock [Abstract] | ' | ' |
Rate class B shares may be converted to class A shares | '1.15 to 1 | ' |
Number of vote for class of shares held | '1 | ' |
Common Class B [Member] | ' | ' |
Common Stock [Abstract] | ' | ' |
Rate class B shares may be converted to class A shares | '1.15 to 1 | ' |
Number of vote for class of shares held | '10 | ' |
REGULATORY_CAPITAL_REQUIREMENT2
REGULATORY CAPITAL REQUIREMENTS (Details) (USD $) | 3 Months Ended | 12 Months Ended | 12 Months Ended | ||||||||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Royal Bank [Member] | Royal Bank [Member] | Royal Bank [Member] | Royal Bancshares [Member] | Royal Bancshares [Member] | Royal Bancshares [Member] | Royal Bancshares [Member] | |||||||||||
FR Y-9C [Member] | FR Y-9C [Member] | ||||||||||||||||
REGULATORY CAPITAL REQUIREMENTS [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Minimum Tier one leverage ratio required (in hundredths) | 8.00% | ' | ' | ' | ' | ' | ' | ' | 8.00% | ' | ' | ' | 8.00% | ' | ' | ' | ' |
Total risk based capital ratio (in hundredths) | 12.00% | ' | ' | ' | ' | ' | ' | ' | 12.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Capital actual amount under regulations [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total capital (to risk-weighted assets) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $71,417 | $67,338 | ' | $84,384 | $84,073 | ' | ' |
Tier I capital (to risk-weighted assets) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 65,602 | 61,664 | ' | 71,432 | 71,138 | ' | ' |
Tier I capital (to average assets, leverage) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 65,602 | 61,664 | ' | 71,432 | 71,138 | ' | ' |
Actual Ratio Under RAP [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total capital (to risk-weighted assets) (in hundredths) | 15.61% | ' | ' | ' | 15.22% | ' | ' | ' | 15.61% | 15.22% | 15.61% | 15.22% | ' | 18.09% | 18.46% | ' | ' |
Tier I capital (to risk-weighted assets) (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 14.34% | 13.94% | ' | 15.31% | 15.62% | ' | ' |
Tier I capital (to average assets, leverage) (in hundredths) | 9.13% | ' | ' | ' | 8.00% | ' | ' | ' | 9.13% | 8.00% | 9.13% | 8.00% | ' | 9.79% | 9.05% | ' | ' |
For capital adequacy purposes, amount [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total capital (to risk-weighted assets) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 36,590 | 35,386 | ' | 37,315 | 36,429 | ' | ' |
Tier I capital (to risk-weighted assets) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 18,295 | 17,693 | ' | 18,658 | 18,214 | ' | ' |
Tier I capital (to average assets, leverage) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 28,739 | 30,842 | ' | 29,178 | 31,443 | ' | ' |
For capital adequacy purposes, ratio [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total capital (to risk-weighted assets) (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8.00% | 8.00% | ' | 8.00% | 8.00% | ' | ' |
Tier I capital (to risk-weighted assets) (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4.00% | 4.00% | ' | 4.00% | 4.00% | ' | ' |
Tier I capital (to average assets, leverage) (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4.00% | 4.00% | ' | 4.00% | 4.00% | ' | ' |
To be well capitalized capitalized under prompt corrective action provision, amount [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total capital (to risk-weighted assets) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 45,737 | 44,233 | ' | ' | ' | ' | ' |
Tier I capital (to risk-weighted assets) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 27,442 | 26,540 | ' | ' | ' | ' | ' |
Tier I capital (to average assets, leverage) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 35,924 | 38,552 | ' | ' | ' | ' | ' |
To be well capitalized capitalized under prompt corrective action provision, ratio [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total capital (to risk-weighted assets) (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% | 10.00% | ' | ' | ' | ' | ' |
Tier I capital (to risk-weighted assets) (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6.00% | 6.00% | ' | ' | ' | ' | ' |
Tier I capital (to average assets, leverage) (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5.00% | 5.00% | ' | ' | ' | ' | ' |
Adjustments to net loss as well as the capital ratios [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
RAP net loss | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -139 | -17,974 | ' | -735 | -20,356 | ' | ' |
Tax lien adjustment, net of noncontrolling interest | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,844 | 4,731 | ' | -2,844 | -4,731 | ' | ' |
U.S. GAAP net income (loss) | $2,452 | $342 | ($803) | $118 | ($7,994) | ($4,812) | ($1,950) | ($869) | $2,109 | ($15,625) | $2,705 | ($13,243) | ' | $2,109 | ($15,625) | ' | ' |
Actual Ratio Under US GAAP [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total capital (to risk-weighted assets) (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 16.49% | 16.73% | ' | ' | ' | 18.09% | 18.46% |
Tier I capital (to risk-weighted assets) (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 15.22% | 15.44% | ' | ' | ' | 15.31% | 15.62% |
Tier I capital (to average assets, leverage) (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9.73% | 8.93% | ' | ' | ' | 9.79% | 9.05% |
Ratios As Adjusted Under RAP [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total capital (to risk-weighted assets) (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 17.24% | 17.01% | ' | ' |
Tier I capital (to risk-weighted assets) (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 14.10% | 13.55% | ' | ' |
Tier I capital (to average assets, leverage) (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8.98% | 7.79% | ' | ' |
PENSION_PLANS_Details
PENSION PLANS (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
PENSION PLANS [Abstract] | ' | ' |
Highest consecutive years of employee compensation used to compute benefit | '3 years | ' |
Years of employment used in benefit computation | '10 years | ' |
Defined Contribution Plan [Abstract] | ' | ' |
Employer matching contribution percent of employee contribution (in hundredths) | 5.00% | ' |
Maximum annual contribution per employee | $2,500 | ' |
Defined Benefit Pension Plan [Member] | ' | ' |
Change in Benefit Obligation [Roll Forward] | ' | ' |
Benefit obligation at beginning of year | 16,897,000 | 14,942,000 |
Service cost | 81,000 | 272,000 |
Interest cost | 623,000 | 584,000 |
Benefits paid | -981,000 | -556,000 |
Actuarial (gain) loss | -2,132,000 | 1,655,000 |
Benefit obligation at end of year | 14,488,000 | 16,897,000 |
Unrecognized prior service cost | 179,000 | 269,000 |
Unrecognized actuarial loss | 2,750,000 | 5,119,000 |
Total unrecognized cost | 2,929,000 | 5,388,000 |
Accumulated benefit obligation | 14,500,000 | 16,600,000 |
Assumptions Used to Determine the Benefit Obligations [Abstract] | ' | ' |
Discount rate (in hundredths) | 4.37% | 3.25% |
Rate of compensation increase (in hundredths) | 4.00% | 4.00% |
Assumptions Used to Determine the Net Periodic Pension Cost [Abstract] | ' | ' |
Discount rate (in hundredths) | 4.37% | 4.00% |
Rate of compensation increase (in hundredths) | 4.00% | 4.00% |
Net Pension Cost [Abstract] | ' | ' |
Service cost | 81,000 | 272,000 |
Interest cost | 623,000 | 584,000 |
Amortization of prior service cost | 90,000 | 90,000 |
Amortization of net actuarial loss | 238,000 | 381,000 |
Net periodic benefit cost | 1,032,000 | 1,327,000 |
Benefit Payments to be Made From the Non-qualified Pension Plan [Abstract] | ' | ' |
2014 | 970,000 | ' |
2015 | 987,000 | ' |
2016 | 1,015,000 | ' |
2017 | 1,015,000 | ' |
2018 | 1,015,000 | ' |
Next five years thereafter | 5,610,000 | ' |
Cash surrender value of life insurance policies | 3,400,000 | 3,300,000 |
Defined Contribution Plan [Member] | ' | ' |
Defined Contribution Plan [Abstract] | ' | ' |
Employer matching contribution percent of employee contribution (in hundredths) | 5.00% | ' |
Maximum annual contribution per employee | 2,500 | ' |
Employer contribution to plan | $0 | $0 |
STOCK_COMPENSATION_PLANS_Detai
STOCK COMPENSATION PLANS (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | ||
Share-based Payment Award [Line Items] | ' | ' | |
Compensation expense | $22,000 | $42,000 | |
Employee Stock Option And Appreciation Right Plan [Member] | ' | ' | |
Summary of the Status of the Plan [Roll Forward] | ' | ' | |
Options outstanding at beginning of year (in shares) | 217,561 | 335,919 | |
Exercised (in shares) | 0 | 0 | |
Forfeited (in shares) | -119,137 | -74,569 | |
Expired (in shares) | -15,644 | -43,789 | |
Options outstanding at end of the year (in shares) | 82,780 | 217,561 | |
Options exercisable at end of the year (in shares) | 82,780 | 217,561 | |
Weighted Average Exercise Price [Roll Forward] | ' | ' | |
Options outstanding, weighted average exercise price at beginning of year (in dollars per share) | $21.50 | $21.01 | |
Exercised, weighted average exercise price (in dollars per share) | $0 | $0 | |
Forfeited, weighted average exercise price (in dollars per share) | $21.53 | $21.42 | |
Expired, weighted average exercise price (in dollars per share) | $18.27 | $17.91 | |
Options outstanding, weighted average exercise price at the end of the year (in dollars per share) | $22.06 | $21.50 | |
Options exercisable, weighted average exercise price at the end of the year (in dollars per share) | $22.06 | $21.50 | |
Options, Additional Disclosures [Abstract] | ' | ' | |
Options outstanding, weighted average remaining term at the end of the year | '1 year 1 month 6 days | '1 year 3 months 18 days | |
Options exercisable, weighted average remaining term at the end of the year | '1 year 1 month 6 days | ' | |
Options outstanding, average intrinsic value at the end of the year | 0 | [1] | ' |
Options exercisable, average intrinsic value at the end of the year | 0 | [1] | ' |
Employee Stock Option And Appreciation Right Plan [Member] | Minimum [Member] | ' | ' | |
Share-based Payment Award [Line Items] | ' | ' | |
Award option term period | ' | '1 year | |
Employee Stock Option And Appreciation Right Plan [Member] | Maximum [Member] | ' | ' | |
Share-based Payment Award [Line Items] | ' | ' | |
Award option term period | ' | '10 years | |
Director's Plan [Member] | Minimum [Member] | ' | ' | |
Share-based Payment Award [Line Items] | ' | ' | |
Award option term period | ' | '1 year | |
Director's Plan [Member] | Maximum [Member] | ' | ' | |
Share-based Payment Award [Line Items] | ' | ' | |
Award option term period | ' | '10 years | |
Director's Plan [Member] | Stock Options [Member] | ' | ' | |
Summary of the Status of the Plan [Roll Forward] | ' | ' | |
Options outstanding at beginning of year (in shares) | 58,306 | 68,620 | |
Exercised (in shares) | 0 | 0 | |
Forfeited (in shares) | -24,286 | 0 | |
Expired (in shares) | -8,350 | -10,314 | |
Options outstanding at end of the year (in shares) | 25,670 | 58,306 | |
Options exercisable at end of the year (in shares) | 25,670 | 58,306 | |
Weighted Average Exercise Price [Roll Forward] | ' | ' | |
Options outstanding, weighted average exercise price at beginning of year (in dollars per share) | $21.15 | $20.66 | |
Exercised, weighted average exercise price (in dollars per share) | $0 | $0 | |
Forfeited, weighted average exercise price (in dollars per share) | $21.24 | $0 | |
Expired, weighted average exercise price (in dollars per share) | $18.27 | $17.91 | |
Options outstanding, weighted average exercise price at the end of the year (in dollars per share) | $22 | $21.15 | |
Options exercisable, weighted average exercise price at the end of the year (in dollars per share) | $22 | $21.15 | |
Options, Additional Disclosures [Abstract] | ' | ' | |
Options outstanding, weighted average remaining term at the end of the year | '1 year 6 months | '1 year 2 months 12 days | |
Options exercisable, weighted average remaining term at the end of the year | '1 year 6 months | ' | |
Options outstanding, average intrinsic value at the end of the year | 0 | [1] | ' |
Options exercisable, average intrinsic value at the end of the year | 0 | [1] | ' |
2007 Long-Term Incentive Plan [Member] | ' | ' | |
Share-based Payment Award [Line Items] | ' | ' | |
Compensation expense | 22,000 | 42,000 | |
Number of shares authorized for 2007 Long Term Incentive Plan (in shares) | 1,000,000 | ' | |
Number of shares from unrestricted plan granted (in shares) | 187,390 | ' | |
Share options authorized as a percentage of total class A common stock. | 9.00% | ' | |
Summary of the Status of the Plan [Roll Forward] | ' | ' | |
Options outstanding at beginning of year (in shares) | 86,226 | 116,440 | |
Granted (in shares) | 15,000 | 0 | |
Exercised (in shares) | 0 | 0 | |
Forfeited (in shares) | -11,840 | -30,214 | |
Expired (in shares) | 0 | 0 | |
Options outstanding at end of the year (in shares) | 89,386 | 86,226 | |
Options exercisable at end of the year (in shares) | 74,386 | 75,706 | |
Weighted Average Exercise Price [Roll Forward] | ' | ' | |
Options outstanding, weighted average exercise price at beginning of year (in dollars per share) | $9.22 | $9.73 | |
Granted, weighted average exercise price (in dollars per share) | $1.36 | $0 | |
Exercised, weighted average exercise price (in dollars per share) | $0 | $0 | |
Forfeited, weighted average exercise price (in dollars per share) | $8.83 | $11.19 | |
Expired, weighted average exercise price (in dollars per share) | $0 | $0 | |
Options outstanding, weighted average exercise price at the end of the year (in dollars per share) | $7.95 | $9.22 | |
Options exercisable, weighted average exercise price at the end of the year (in dollars per share) | $9.28 | $9.88 | |
Weighted average fair value of options granted during the year (in dollars per share) | $0.98 | ' | |
Options, Additional Disclosures [Abstract] | ' | ' | |
Options outstanding, weighted average remaining term at the end of the year | '4 years 10 months 24 days | '5 years 4 months 24 days | |
Options exercisable, weighted average remaining term at the end of the year | '4 years | ' | |
Options outstanding, average intrinsic value at the end of the year | 0 | [1] | ' |
Options exercisable, average intrinsic value at the end of the year | $0 | [1] | ' |
Detail for non-vested shares [Roll Forward] | ' | ' | |
Non-vested options at beginning of year (in shares) | 10,520 | ' | |
Granted (in shares) | 15,000 | ' | |
Forfeited (in shares) | -1,590 | ' | |
Vested (in shares) | -8,930 | ' | |
Non-vested options at end of year (in shares) | 15,000 | 10,520 | |
Non-vested, Weighted Average Grant Date Fair Value [Roll Forward] | ' | ' | |
Non-vested options, weighted average exercise price at beginning of year (in dollars per share) | $4.50 | ' | |
Granted, weighted average grant date fair value (in dollars per share) | $1.36 | ' | |
Forfeited, weighted average exercise price (in dollars per share) | $4.50 | ' | |
Vested, weighted average exercise price (in dollars per share) | $4.50 | ' | |
Non-vested options, weighted average exercise price at end of year (in dollars per share) | $1.36 | $4.50 | |
2007 Long-Term Incentive Plan [Member] | Stock Options [Member] | ' | ' | |
Summary of the Status of the Plan [Roll Forward] | ' | ' | |
Options exercisable at end of the year (in shares) | 74,386 | ' | |
Weighted Average Exercise Price [Roll Forward] | ' | ' | |
Options exercisable, weighted average exercise price at the end of the year (in dollars per share) | $9.28 | ' | |
[1] | The aggregate intrinsic value of a stock option in the table above represents the total pre-tax intrinsic value (the amount by which the current market value of the underlying stock exceeds the exercise price of the option) that would have been received by the option holders had they exercised their options on December 31, 2013. The intrinsic value varies based on the changes in the market value in the Companybs stock. Because the exercise price exceeded the market value of the options, the average intrinsic value was $0 at December 31, 2013. |
STOCK_COMPENSATION_PLANS_Optio
STOCK COMPENSATION PLANS, Option Plan By Exercise Price Range (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Employee Stock Option And Appreciation Right Plan [Member] | ' | ' |
Stock Option Plan, Exercise Price Range [Line Items] | ' | ' |
Options outstanding and exercisable (in shares) | 82,780 | ' |
Options outstanding and exercisable, weighted average exercise price (in dollars per share) | $22.06 | ' |
Options outstanding and exercisable, weighted average remaining term | '1 year 1 month 6 days | ' |
Options exercisable (in shares) | 82,780 | 217,561 |
Options exercisable, weighted average exercise price (in dollars per share) | $22.06 | $21.50 |
Employee Stock Option And Appreciation Right Plan [Member] | $21.00 - $23.00 [Member] | ' | ' |
Stock Option Plan, Exercise Price Range [Line Items] | ' | ' |
Range of exercise prices, lower range limit (in dollars per share) | $21 | ' |
Range of exercise prices, upper range limit (in dollars per share) | $23 | ' |
Options outstanding and exercisable (in shares) | 82,780 | ' |
Options outstanding and exercisable, weighted average exercise price (in dollars per share) | $22.06 | ' |
Options outstanding and exercisable, weighted average remaining term | '1 year 1 month 6 days | ' |
Director's Plan [Member] | ' | ' |
Stock Option Plan, Exercise Price Range [Line Items] | ' | ' |
Options outstanding and exercisable (in shares) | 25,670 | ' |
Options outstanding and exercisable, weighted average exercise price (in dollars per share) | $22 | ' |
Options outstanding and exercisable, weighted average remaining term | '1 year 6 months | ' |
Director's Plan [Member] | $21.00 - $23.00 [Member] | ' | ' |
Stock Option Plan, Exercise Price Range [Line Items] | ' | ' |
Range of exercise prices, lower range limit (in dollars per share) | $21 | ' |
Range of exercise prices, upper range limit (in dollars per share) | $23 | ' |
Options outstanding and exercisable (in shares) | 25,670 | ' |
Options outstanding and exercisable, weighted average exercise price (in dollars per share) | $22 | ' |
Options outstanding and exercisable, weighted average remaining term | '1 year 6 months | ' |
Director's Plan [Member] | Stock Options [Member] | ' | ' |
Stock Option Plan, Exercise Price Range [Line Items] | ' | ' |
Options exercisable (in shares) | 25,670 | 58,306 |
Options exercisable, weighted average exercise price (in dollars per share) | $22 | $21.15 |
2007 Long-Term Incentive Plan [Member] | ' | ' |
Stock Option Plan, Exercise Price Range [Line Items] | ' | ' |
Options exercisable (in shares) | 74,386 | 75,706 |
Options exercisable, weighted average exercise price (in dollars per share) | $9.28 | $9.88 |
2007 Long-Term Incentive Plan [Member] | Stock Options [Member] | ' | ' |
Stock Option Plan, Exercise Price Range [Line Items] | ' | ' |
Options outstanding and exercisable (in shares) | 89,386 | ' |
Options outstanding and exercisable, weighted average exercise price (in dollars per share) | $7.95 | ' |
Options outstanding and exercisable, weighted average remaining term | '4 years | ' |
Options exercisable (in shares) | 74,386 | ' |
Options exercisable, weighted average exercise price (in dollars per share) | $9.28 | ' |
2007 Long-Term Incentive Plan [Member] | Stock Options [Member] | $4.50 [Member] | ' | ' |
Stock Option Plan, Exercise Price Range [Line Items] | ' | ' |
Range of exercise prices, upper range limit (in dollars per share) | $4.50 | ' |
Options outstanding and exercisable (in shares) | 51,550 | ' |
Options outstanding and exercisable, weighted average exercise price (in dollars per share) | $4.50 | ' |
Options outstanding and exercisable, weighted average remaining term | '4 years 3 months 18 days | ' |
Options exercisable (in shares) | 51,550 | ' |
Options exercisable, weighted average exercise price (in dollars per share) | $4.50 | ' |
2007 Long-Term Incentive Plan [Member] | Stock Options [Member] | $20.08 [Member] | ' | ' |
Stock Option Plan, Exercise Price Range [Line Items] | ' | ' |
Range of exercise prices, upper range limit (in dollars per share) | $20.08 | ' |
Options outstanding and exercisable (in shares) | 22,836 | ' |
Options outstanding and exercisable, weighted average exercise price (in dollars per share) | $20.08 | ' |
Options outstanding and exercisable, weighted average remaining term | '3 years 3 months 18 days | ' |
Options exercisable (in shares) | 22,836 | ' |
Options exercisable, weighted average exercise price (in dollars per share) | $20.08 | ' |
2007 Long-Term Incentive Plan [Member] | Stock Options [Member] | $1.36 [Member] | ' | ' |
Stock Option Plan, Exercise Price Range [Line Items] | ' | ' |
Range of exercise prices, upper range limit (in dollars per share) | $1.36 | ' |
Options outstanding and exercisable (in shares) | 15,000 | ' |
Options outstanding and exercisable, weighted average exercise price (in dollars per share) | $1.36 | ' |
Options outstanding and exercisable, weighted average remaining term | '9 years 3 months 18 days | ' |
Options exercisable (in shares) | 0 | ' |
Options exercisable, weighted average exercise price (in dollars per share) | $0 | ' |
EARNINGS_PER_COMMON_SHARE_EPS_1
EARNINGS PER COMMON SHARE ("EPS") (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Basic and Diluted EPS [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income (loss) available to common shareholders (numerator) | $1,930 | ($178) | ($1,321) | ($397) | ($8,507) | ($5,323) | ($2,458) | ($1,375) | $34 | ($17,663) |
Average shares (denominator) (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | 13,279,000 | 13,257,000 |
Per share Amount (in dollars per share) | $0.14 | ($0.01) | ($0.10) | ($0.03) | ($0.64) | ($0.40) | ($0.19) | ($0.10) | $0 | ($1.33) |
Stock Options [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Antidilutive securities excluded from computation of diluted EPS (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | 197,836 | 362,093 |
Warrant [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Antidilutive securities excluded from computation of diluted EPS (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | 30,407 | 30,407 |
COMPREHENSIVE_LOSS_Details
COMPREHENSIVE LOSS (Details) (USD $) | 12 Months Ended | ||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | ||
Unrealized gains on investment securities: [Abstract] | ' | ' | ' | ||
Unrealized holding losses arising during period, before tax | ($10,291) | ($1,573) | ' | ||
Less adjustment for impaired investments, before tax | ' | -2,359 | ' | ||
Less reclassification adjustment for gains realized in net income, before tax | 158 | 1,030 | ' | ||
Unrealized losses on investment securities, before tax | -10,449 | -244 | ' | ||
Unrecognized benefit obligation expense [Abstract] | ' | ' | ' | ||
Actuarial gain (loss), before tax | 950 | -1,655 | ' | ||
Less reclassification adjustment for amortization, before tax | -328 | -471 | ' | ||
Unrecognized benefit obligation expense, before tax | 1,278 | -1,184 | ' | ||
Other comprehensive loss, net, before tax | -9,171 | -1,428 | ' | ||
Unrealized gains on investment securities [Abstract] | ' | ' | ' | ||
Unrealized holding losses arising during period, tax | -3,572 | -535 | ' | ||
Less adjustment for impaired investments, tax | ' | -802 | ' | ||
Less reclassification adjustment for gains realized in net income, tax | 54 | 350 | ' | ||
Unrealized losses on investment securities, tax | -3,626 | -83 | ' | ||
Unrecognized benefit obligation expense [Abstract] | ' | ' | ' | ||
Actuarial loss, tax | 323 | -563 | ' | ||
Less reclassification adjustment for amortization, tax | -112 | -160 | ' | ||
Unrecognized benefit obligation expense, tax | 435 | -403 | ' | ||
Other comprehensive income, net, tax | -3,191 | -486 | ' | ||
Unrealized gains on investment securities [Abstract] | ' | ' | ' | ||
Unrealized holding losses arising during period, net of tax | -6,719 | -1,038 | ' | ||
Less adjustment for impaired investments, net of tax | 0 | [1] | -1,557 | [1] | ' |
Less reclassification adjustment for gains realized in net income (loss) | 104 | [2] | 680 | [2] | ' |
Unrealized losses on investment securities | -6,823 | -161 | ' | ||
Unrecognized benefit obligation expense [Abstract] | ' | ' | ' | ||
Actuarial loss, net of tax | 627 | -1,092 | ' | ||
Less reclassification adjustment for amortization, net of tax | -216 | [3] | -311 | [3] | ' |
Unrecognized benefit obligation expense, net of tax | 843 | -781 | ' | ||
Other comprehensive loss | -5,980 | -942 | ' | ||
Accumulated Other Comprehensive Income [Abstract] | ' | ' | ' | ||
Unrecognized benefit obligation | -2,929 | -3,556 | ' | ||
Unrealized gains on AFS investments | -3,193 | 3,414 | ' | ||
Accumulated other comprehensive loss | ($6,122) | ($142) | $800 | ||
[1] | Amounts are included in total other-than-temporary impairment on investment securities on the Consolidated Statements of Operations in total noninterest income. | ||||
[2] | Amounts are included in net gains on the sale of available for sale investment securities on the Consolidated Statements of Operations in total noninterest income. | ||||
[3] | Amounts are included in salaries and benefits on the Consolidated Statements of Operations in noninterest expense. |
FAIR_VALUE_OF_FINANCIAL_INSTRU2
FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Financial assets measured at fair value on recurring basis [Abstract] | ' | ' |
Collateralized mortgage obligations issued or guaranteed by U.S. government agencies | $189,103 | ' |
Collateralized mortgage obligations Non-agency | 4,479 | ' |
Quoted Prices in Active Markets for Identical Assets Level 1 [Member] | ' | ' |
Financial assets measured at fair value on recurring basis [Abstract] | ' | ' |
Total investment securities available-for-sale | 49 | 47 |
Financial assets measured at fair value on nonrecurring basis [Abstract] | ' | ' |
Loans and leases held for sale | 0 | 0 |
Significant Other Observable Inputs Level 2 [Member] | ' | ' |
Financial assets measured at fair value on recurring basis [Abstract] | ' | ' |
Total investment securities available-for-sale | 304,053 | 344,992 |
Financial assets measured at fair value on nonrecurring basis [Abstract] | ' | ' |
Loans and leases held for sale | 0 | 0 |
Significant Unobservable Inputs Level 3 [Member] | ' | ' |
Financial assets measured at fair value on recurring basis [Abstract] | ' | ' |
Total investment securities available-for-sale | 4,625 | 4,164 |
Financial assets measured at fair value on nonrecurring basis [Abstract] | ' | ' |
Loans and leases held for sale | 1,446 | 1,572 |
Recurring [Member] | ' | ' |
Financial assets measured at fair value on recurring basis [Abstract] | ' | ' |
U.S. government agencies | 62,036 | 66,444 |
Mortgage-backed securities - residential | 32,097 | 30,509 |
Collateralized mortgage obligations issued or guaranteed by U.S. government agencies | 189,103 | 233,976 |
Collateralized mortgage obligations Non-agency | 4,479 | 1,011 |
Corporate bonds | 9,438 | 7,437 |
Municipal bonds | 6,900 | 5,615 |
Other securities | 4,625 | 4,164 |
Common stocks | 49 | 47 |
Total investment securities available-for-sale | 308,727 | 349,203 |
Recurring [Member] | Quoted Prices in Active Markets for Identical Assets Level 1 [Member] | ' | ' |
Financial assets measured at fair value on recurring basis [Abstract] | ' | ' |
U.S. government agencies | 0 | 0 |
Mortgage-backed securities - residential | 0 | 0 |
Collateralized mortgage obligations issued or guaranteed by U.S. government agencies | 0 | 0 |
Collateralized mortgage obligations Non-agency | 0 | 0 |
Corporate bonds | 0 | 0 |
Municipal bonds | 0 | 0 |
Other securities | 0 | 0 |
Common stocks | 49 | 47 |
Total investment securities available-for-sale | 49 | 47 |
Recurring [Member] | Significant Other Observable Inputs Level 2 [Member] | ' | ' |
Financial assets measured at fair value on recurring basis [Abstract] | ' | ' |
U.S. government agencies | 62,036 | 66,444 |
Mortgage-backed securities - residential | 32,097 | 30,509 |
Collateralized mortgage obligations issued or guaranteed by U.S. government agencies | 189,103 | 233,976 |
Collateralized mortgage obligations Non-agency | 4,479 | 1,011 |
Corporate bonds | 9,438 | 7,437 |
Municipal bonds | 6,900 | 5,615 |
Other securities | 0 | 0 |
Common stocks | 0 | 0 |
Total investment securities available-for-sale | 304,053 | 344,992 |
Recurring [Member] | Significant Unobservable Inputs Level 3 [Member] | ' | ' |
Financial assets measured at fair value on recurring basis [Abstract] | ' | ' |
U.S. government agencies | 0 | 0 |
Mortgage-backed securities - residential | 0 | 0 |
Collateralized mortgage obligations issued or guaranteed by U.S. government agencies | 0 | 0 |
Collateralized mortgage obligations Non-agency | 0 | 0 |
Corporate bonds | 0 | 0 |
Municipal bonds | 0 | 0 |
Other securities | 4,625 | 4,164 |
Common stocks | 0 | 0 |
Total investment securities available-for-sale | 4,625 | 4,164 |
Nonrecurring [Member] | ' | ' |
Financial assets measured at fair value on nonrecurring basis [Abstract] | ' | ' |
Impaired loans | 4,073 | 9,180 |
Other real estate owned | 9,182 | 7,632 |
Loans and leases held for sale | 1,446 | 1,572 |
Nonrecurring [Member] | Quoted Prices in Active Markets for Identical Assets Level 1 [Member] | ' | ' |
Financial assets measured at fair value on nonrecurring basis [Abstract] | ' | ' |
Impaired loans | 0 | 0 |
Other real estate owned | 0 | 0 |
Loans and leases held for sale | 0 | 0 |
Nonrecurring [Member] | Significant Other Observable Inputs Level 2 [Member] | ' | ' |
Financial assets measured at fair value on nonrecurring basis [Abstract] | ' | ' |
Impaired loans | 0 | 0 |
Other real estate owned | 0 | 0 |
Loans and leases held for sale | 0 | 0 |
Nonrecurring [Member] | Significant Unobservable Inputs Level 3 [Member] | ' | ' |
Financial assets measured at fair value on nonrecurring basis [Abstract] | ' | ' |
Impaired loans | 4,073 | 9,180 |
Other real estate owned | 9,182 | 7,632 |
Loans and leases held for sale | $1,446 | $1,572 |
FAIR_VALUE_OF_FINANCIAL_INSTRU3
FAIR VALUE OF FINANCIAL INSTRUMENTS - UNOBSERVABLE INPUT RECONCILIATION (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Assets measured at fair value on recurring basis Level 3 inputs [Roll Forward] | ' | ' |
Beginning balance | ' | $19,521 |
Total gains/(losses) - (realized/unrealized) [Abstract] | ' | ' |
Included in earnings | ' | -1,691 |
Included in other comprehensive income | ' | -1,859 |
Purchases | ' | 788 |
Sales and calls | ' | -12,577 |
Amortization of premium | ' | -18 |
Transfers in and/or out of Level 3 | ' | 0 |
Ending balance | ' | 4,164 |
Trust Preferred Securities [Member] | ' | ' |
Assets measured at fair value on recurring basis Level 3 inputs [Roll Forward] | ' | ' |
Beginning balance | ' | 12,603 |
Total gains/(losses) - (realized/unrealized) [Abstract] | ' | ' |
Included in earnings | ' | 126 |
Included in other comprehensive income | ' | -1,938 |
Purchases | ' | 0 |
Sales and calls | ' | -10,773 |
Amortization of premium | ' | -18 |
Transfers in and/or out of Level 3 | ' | 0 |
Ending balance | ' | 0 |
Other Securities [Member] | ' | ' |
Assets measured at fair value on recurring basis Level 3 inputs [Roll Forward] | ' | ' |
Beginning balance | 4,164 | 6,918 |
Total gains/(losses) - (realized/unrealized) [Abstract] | ' | ' |
Included in earnings | 94 | -1,817 |
Included in other comprehensive income | 850 | 79 |
Purchases | 70 | 788 |
Sales and calls | -553 | -1,804 |
Amortization of premium | ' | 0 |
Transfers in and/or out of Level 3 | 0 | 0 |
Ending balance | $4,625 | $4,164 |
FAIR_VALUE_OF_FINANCIAL_INSTRU4
FAIR VALUE OF FINANCIAL INSTRUMENTS - QUANTITATIVE INFORMATION (Details) (Significant Unobservable Inputs Level 3 [Member], USD $) | Dec. 31, 2013 | |
In Thousands, unless otherwise specified | ||
Minimum [Member] | Impaired loans and leases [Member] | ' | |
Additional quantitative information about assets measured at fair value on a nonrecurring basis [Abstract] | ' | |
Range (Weighted Average) of Liquidation expenses (in hundredths) | 0.00% | [1] |
Maximum [Member] | Impaired loans and leases [Member] | ' | |
Additional quantitative information about assets measured at fair value on a nonrecurring basis [Abstract] | ' | |
Range (Weighted Average) of Liquidation expenses (in hundredths) | -23.20% | [1] |
Weighted Average [Member] | Impaired loans and leases [Member] | ' | |
Additional quantitative information about assets measured at fair value on a nonrecurring basis [Abstract] | ' | |
Range (Weighted Average) of Liquidation expenses (in hundredths) | -6.70% | [1] |
Appraisal of collateral valuation technique [Member] | Impaired loans and leases [Member] | ' | |
Additional quantitative information about assets measured at fair value on a nonrecurring basis [Abstract] | ' | |
Assets, Fair Value | 4,073 | |
Appraisal of collateral valuation technique [Member] | Other real estate owned [Member] | ' | |
Additional quantitative information about assets measured at fair value on a nonrecurring basis [Abstract] | ' | |
Assets, Fair Value | 9,182 | |
Appraisal of collateral valuation technique [Member] | Minimum [Member] | Impaired loans and leases [Member] | ' | |
Additional quantitative information about assets measured at fair value on a nonrecurring basis [Abstract] | ' | |
Range (Weighted Average) of Appraisal adjustments (in hundredths) | 0.00% | [1] |
Appraisal of collateral valuation technique [Member] | Minimum [Member] | Other real estate owned [Member] | ' | |
Additional quantitative information about assets measured at fair value on a nonrecurring basis [Abstract] | ' | |
Range (Weighted Average) of Appraisal adjustments (in hundredths) | 0.00% | [1] |
Appraisal of collateral valuation technique [Member] | Maximum [Member] | Impaired loans and leases [Member] | ' | |
Additional quantitative information about assets measured at fair value on a nonrecurring basis [Abstract] | ' | |
Range (Weighted Average) of Appraisal adjustments (in hundredths) | -25.00% | [1] |
Appraisal of collateral valuation technique [Member] | Maximum [Member] | Other real estate owned [Member] | ' | |
Additional quantitative information about assets measured at fair value on a nonrecurring basis [Abstract] | ' | |
Range (Weighted Average) of Appraisal adjustments (in hundredths) | -62.50% | [1] |
Appraisal of collateral valuation technique [Member] | Weighted Average [Member] | Impaired loans and leases [Member] | ' | |
Additional quantitative information about assets measured at fair value on a nonrecurring basis [Abstract] | ' | |
Range (Weighted Average) of Appraisal adjustments (in hundredths) | -2.00% | [1] |
Appraisal of collateral valuation technique [Member] | Weighted Average [Member] | Other real estate owned [Member] | ' | |
Additional quantitative information about assets measured at fair value on a nonrecurring basis [Abstract] | ' | |
Range (Weighted Average) of Appraisal adjustments (in hundredths) | -11.20% | [1] |
Salvageable value of collateral valuation technique [Member] | Impaired loans and leases [Member] | ' | |
Additional quantitative information about assets measured at fair value on a nonrecurring basis [Abstract] | ' | |
Range (Weighted Average) of Salvageable value of collateral (in hundredths) | 0.00% | [2] |
Sales prices [Member] | Loans and leases held for sale [Member] | ' | |
Additional quantitative information about assets measured at fair value on a nonrecurring basis [Abstract] | ' | |
Assets, Fair Value | 1,446 | |
Sales prices [Member] | Minimum [Member] | Other real estate owned [Member] | ' | |
Additional quantitative information about assets measured at fair value on a nonrecurring basis [Abstract] | ' | |
Range (Weighted Average) of Liquidation expenses (in hundredths) | -2.80% | |
Sales prices [Member] | Maximum [Member] | Other real estate owned [Member] | ' | |
Additional quantitative information about assets measured at fair value on a nonrecurring basis [Abstract] | ' | |
Range (Weighted Average) of Liquidation expenses (in hundredths) | -6.80% | |
Sales prices [Member] | Weighted Average [Member] | Other real estate owned [Member] | ' | |
Additional quantitative information about assets measured at fair value on a nonrecurring basis [Abstract] | ' | |
Range (Weighted Average) of Liquidation expenses (in hundredths) | -5.00% | |
[1] | Appraisals or brokers opinions of collateral values may be adjusted for qualitative factors such as interior condition of the property and liquidation expenses. Fair value may also be based on negotiated settlements with the borrower. | |
[2] | Leases are measured using the salvageable value of the collateral. |
FAIR_VALUE_OF_FINANCIAL_INSTRU5
FAIR VALUE OF FINANCIAL INSTRUMENTS - BALANCE SHEET GROUPING (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Quoted Prices in Active Markets for Identical Assets Level 1 [Member] | ' | ' |
Financial Assets [Abstract] | ' | ' |
Cash and cash equivalents | $16,844 | $28,802 |
AFS investment securities | 49 | 47 |
Other investment | 0 | 0 |
Federal Home Loan Bank stock | 0 | 0 |
Loans held for sale | 0 | 0 |
Loans, net | 0 | 0 |
Accrued interest receivable | 0 | 0 |
Financial Liabilities [Abstract] | ' | ' |
Demand deposits | 0 | 0 |
NOW and money markets | 0 | 0 |
Savings | 0 | 0 |
Time deposits | 0 | 0 |
Short-term borrowings | 10,000 | ' |
Long-term borrowings | 0 | 0 |
Subordinated debt | 0 | 0 |
Accrued interest payable | 0 | 0 |
Significant Other Observable Inputs Level 2 [Member] | ' | ' |
Financial Assets [Abstract] | ' | ' |
Cash and cash equivalents | 0 | 0 |
AFS investment securities | 304,053 | 344,992 |
Other investment | 0 | 0 |
Federal Home Loan Bank stock | 0 | 0 |
Loans held for sale | 0 | 0 |
Loans, net | 0 | 0 |
Accrued interest receivable | 7,054 | 10,256 |
Financial Liabilities [Abstract] | ' | ' |
Demand deposits | 60,473 | 58,531 |
NOW and money markets | 210,053 | 223,279 |
Savings | 17,593 | 17,472 |
Time deposits | 239,102 | 251,532 |
Short-term borrowings | 0 | ' |
Long-term borrowings | 94,896 | 102,824 |
Subordinated debt | 26,000 | 23,837 |
Accrued interest payable | 965 | 3,760 |
Significant Unobservable Inputs Level 3 [Member] | ' | ' |
Financial Assets [Abstract] | ' | ' |
Cash and cash equivalents | 0 | 0 |
AFS investment securities | 4,625 | 4,164 |
Other investment | 2,250 | 2,250 |
Federal Home Loan Bank stock | 4,204 | 6,011 |
Loans held for sale | 1,446 | 1,572 |
Loans, net | 349,336 | 330,260 |
Accrued interest receivable | 0 | 0 |
Financial Liabilities [Abstract] | ' | ' |
Demand deposits | 0 | 0 |
NOW and money markets | 0 | 0 |
Savings | 0 | 0 |
Time deposits | 0 | 0 |
Short-term borrowings | 0 | ' |
Long-term borrowings | 0 | 0 |
Subordinated debt | 0 | 0 |
Accrued interest payable | 0 | 0 |
Carrying Amount [Member] | ' | ' |
Financial Assets [Abstract] | ' | ' |
Cash and cash equivalents | 16,844 | 28,802 |
AFS investment securities | 308,727 | 349,203 |
Other investment | 2,250 | 2,250 |
Federal Home Loan Bank stock | 4,204 | 6,011 |
Loans held for sale | 1,446 | 1,572 |
Loans, net | 352,810 | 326,904 |
Accrued interest receivable | 7,054 | 10,256 |
Financial Liabilities [Abstract] | ' | ' |
Demand deposits | 60,473 | 58,531 |
NOW and money markets | 210,053 | 223,279 |
Savings | 17,593 | 17,472 |
Time deposits | 240,845 | 255,635 |
Short-term borrowings | 10,000 | ' |
Long-term borrowings | 97,881 | 108,333 |
Subordinated debt | 25,774 | 25,774 |
Accrued interest payable | 965 | 3,760 |
Estimated Fair Value [Member] | ' | ' |
Financial Assets [Abstract] | ' | ' |
Cash and cash equivalents | 16,844 | 28,802 |
AFS investment securities | 308,727 | 349,203 |
Other investment | 2,250 | 2,250 |
Federal Home Loan Bank stock | 4,204 | 6,011 |
Loans held for sale | 1,446 | 1,572 |
Loans, net | 349,336 | 330,260 |
Accrued interest receivable | 7,054 | 10,256 |
Financial Liabilities [Abstract] | ' | ' |
Demand deposits | 60,473 | 58,531 |
NOW and money markets | 210,053 | 223,279 |
Savings | 17,593 | 17,472 |
Time deposits | 239,102 | 251,532 |
Short-term borrowings | 10,000 | ' |
Long-term borrowings | 94,896 | 102,824 |
Subordinated debt | 26,000 | 23,837 |
Accrued interest payable | $965 | $3,760 |
SEGMENT_INFORMATION_Details
SEGMENT INFORMATION (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Selected Segment Information and Reconciliations to Consolidated Financial Information [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total assets | $732,254 | ' | ' | ' | $769,455 | ' | ' | ' | $732,254 | $769,455 |
Total deposits | 528,964 | ' | ' | ' | 554,917 | ' | ' | ' | 528,964 | 554,917 |
Interest income | 7,069 | 6,960 | 6,743 | 6,752 | 6,991 | 7,761 | 8,423 | 8,806 | 27,524 | 31,981 |
Interest expense | ' | ' | ' | ' | ' | ' | ' | ' | 7,357 | 9,899 |
Net Interest Income | 5,379 | 5,070 | 4,946 | 4,772 | 4,801 | 5,382 | 5,906 | 5,993 | 20,167 | 22,082 |
(Credit) provision for loan and lease losses | -676 | 218 | -163 | -251 | 2,637 | 1,761 | 1,515 | 84 | -872 | 5,997 |
Total non-interest income | 2,558 | 1,937 | 961 | 1,408 | -148 | 1,151 | 1,945 | 661 | 6,864 | 3,609 |
Total non-interest expenses | ' | ' | ' | ' | ' | ' | ' | ' | 26,330 | 36,324 |
Income tax (benefit) expense | 42 | 0 | 0 | 0 | ' | ' | ' | ' | 42 | 0 |
Net Income (Loss) | 2,238 | 499 | -1,497 | 291 | -8,240 | -4,637 | -2,256 | -1,497 | 1,531 | -16,630 |
Noncontrolling interest | -214 | 157 | -694 | 173 | -246 | 175 | -306 | -628 | -578 | -1,005 |
Net Income (Loss) Attributable to Royal Bancshares of Pennsylvania, Inc. | 2,452 | 342 | -803 | 118 | -7,994 | -4,812 | -1,950 | -869 | 2,109 | -15,625 |
Community Banking [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Selected Segment Information and Reconciliations to Consolidated Financial Information [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total assets | 706,026 | ' | ' | ' | 732,137 | ' | ' | ' | 706,026 | 732,137 |
Total deposits | 528,964 | ' | ' | ' | 554,917 | ' | ' | ' | 528,964 | 554,917 |
Interest income | ' | ' | ' | ' | ' | ' | ' | ' | 25,097 | 26,956 |
Interest expense | ' | ' | ' | ' | ' | ' | ' | ' | 5,899 | 7,202 |
Net Interest Income | ' | ' | ' | ' | ' | ' | ' | ' | 19,198 | 19,754 |
(Credit) provision for loan and lease losses | ' | ' | ' | ' | ' | ' | ' | ' | -1,459 | 5,177 |
Total non-interest income | ' | ' | ' | ' | ' | ' | ' | ' | 5,476 | 2,868 |
Total non-interest expenses | ' | ' | ' | ' | ' | ' | ' | ' | 21,959 | 31,118 |
Income tax (benefit) expense | ' | ' | ' | ' | ' | ' | ' | ' | 42 | -28 |
Net Income (Loss) | ' | ' | ' | ' | ' | ' | ' | ' | 4,132 | -13,645 |
Noncontrolling interest | ' | ' | ' | ' | ' | ' | ' | ' | 462 | 189 |
Net Income (Loss) Attributable to Royal Bancshares of Pennsylvania, Inc. | ' | ' | ' | ' | ' | ' | ' | ' | 3,670 | -13,834 |
Tax Lien Operation [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Selected Segment Information and Reconciliations to Consolidated Financial Information [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total assets | 26,228 | ' | ' | ' | 37,318 | ' | ' | ' | 26,228 | 37,318 |
Total deposits | 0 | ' | ' | ' | 0 | ' | ' | ' | 0 | 0 |
Interest income | ' | ' | ' | ' | ' | ' | ' | ' | 2,427 | 5,025 |
Interest expense | ' | ' | ' | ' | ' | ' | ' | ' | 1,458 | 2,697 |
Net Interest Income | ' | ' | ' | ' | ' | ' | ' | ' | 969 | 2,328 |
(Credit) provision for loan and lease losses | ' | ' | ' | ' | ' | ' | ' | ' | 587 | 820 |
Total non-interest income | ' | ' | ' | ' | ' | ' | ' | ' | 1,388 | 741 |
Total non-interest expenses | ' | ' | ' | ' | ' | ' | ' | ' | 4,371 | 5,206 |
Income tax (benefit) expense | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 28 |
Net Income (Loss) | ' | ' | ' | ' | ' | ' | ' | ' | -2,601 | -2,985 |
Noncontrolling interest | ' | ' | ' | ' | ' | ' | ' | ' | -1,040 | -1,194 |
Net Income (Loss) Attributable to Royal Bancshares of Pennsylvania, Inc. | ' | ' | ' | ' | ' | ' | ' | ' | -1,561 | -1,791 |
Tax Lien Operation Interest [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Selected Segment Information and Reconciliations to Consolidated Financial Information [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest income | ' | ' | ' | ' | ' | ' | ' | ' | $1,500 | $2,700 |
CONDENSED_FINANCIAL_INFORMATIO2
CONDENSED FINANCIAL INFORMATION - PARENT COMPANY ONLY (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
ASSETS | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash | $9,154 | ' | ' | ' | $10,621 | ' | ' | ' | $9,154 | $10,621 | ' |
Other assets | 9,703 | ' | ' | ' | 11,205 | ' | ' | ' | 9,703 | 11,205 | ' |
Total assets | 732,254 | ' | ' | ' | 769,455 | ' | ' | ' | 732,254 | 769,455 | ' |
Subordinated debentures | 25,774 | ' | ' | ' | 25,774 | ' | ' | ' | 25,774 | 25,774 | ' |
Shareholder's equity | 47,805 | ' | ' | ' | 53,568 | ' | ' | ' | 47,805 | 53,568 | 71,098 |
Total liabilities and shareholders' equity | 732,254 | ' | ' | ' | 769,455 | ' | ' | ' | 732,254 | 769,455 | ' |
Income | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Other income | ' | ' | ' | ' | ' | ' | ' | ' | 207 | 747 | ' |
Expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Other expenses | ' | ' | ' | ' | ' | ' | ' | ' | 2,562 | 2,903 | ' |
Total Non-interest Expense | 6,333 | 6,290 | 7,567 | 6,140 | 10,256 | 9,409 | 8,592 | 8,067 | 26,330 | 36,324 | ' |
Income (Loss) Before Income Taxes | 2,280 | 499 | -1,497 | 291 | -8,240 | -4,637 | -2,256 | -1,497 | 1,573 | -16,630 | ' |
Income tax expense | 42 | 0 | 0 | 0 | ' | ' | ' | ' | 42 | 0 | ' |
Net Income (Loss) | 2,238 | 499 | -1,497 | 291 | -8,240 | -4,637 | -2,256 | -1,497 | 1,531 | -16,630 | ' |
Cash flows from operating activities: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) | 2,452 | 342 | -803 | 118 | -7,994 | -4,812 | -1,950 | -869 | 2,109 | -15,625 | ' |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest on subordinated debentures | ' | ' | ' | ' | ' | ' | ' | ' | -2,795 | 310 | ' |
Net cash provided by operating activities | ' | ' | ' | ' | ' | ' | ' | ' | 5,437 | 26,881 | ' |
Net cash provided by investing activities | ' | ' | ' | ' | ' | ' | ' | ' | 9,010 | 38,081 | ' |
Cash flows from financing activities | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Loan payoffs (fundings) | ' | ' | ' | ' | ' | ' | ' | ' | -50,452 | -449 | ' |
Net cash used in financing activities | ' | ' | ' | ' | ' | ' | ' | ' | -26,405 | -60,666 | ' |
Net increase (decrease) in cash and cash equivalents | ' | ' | ' | ' | ' | ' | ' | ' | -11,958 | 4,296 | ' |
Cash and cash equivalents at beginning of period | ' | ' | ' | 28,802 | ' | ' | ' | 24,506 | 28,802 | 24,506 | ' |
Cash and cash equivalents at end of period | 16,844 | ' | ' | ' | 28,802 | ' | ' | ' | 16,844 | 28,802 | ' |
Parent Company [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
ASSETS | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash | 1,333 | ' | ' | ' | 4,739 | ' | ' | ' | 1,333 | 4,739 | ' |
Investments in non-bank subsidiaries | 29,795 | ' | ' | ' | 25,830 | ' | ' | ' | 29,795 | 25,830 | ' |
Investments in Royal Bank | 42,165 | ' | ' | ' | 44,725 | ' | ' | ' | 42,165 | 44,725 | ' |
Other assets | 15 | ' | ' | ' | 238 | ' | ' | ' | 15 | 238 | ' |
Total assets | 73,308 | ' | ' | ' | 75,532 | ' | ' | ' | 73,308 | 75,532 | ' |
Subordinated debentures | 25,774 | ' | ' | ' | 25,774 | ' | ' | ' | 25,774 | 25,774 | ' |
Shareholder's equity | 47,534 | ' | ' | ' | 49,758 | ' | ' | ' | 47,534 | 49,758 | ' |
Total liabilities and shareholders' equity | 73,308 | ' | ' | ' | 75,532 | ' | ' | ' | 73,308 | 75,532 | ' |
Income | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Other income | ' | ' | ' | ' | ' | ' | ' | ' | 25 | 20 | ' |
Total Income | ' | ' | ' | ' | ' | ' | ' | ' | 25 | 20 | ' |
Expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Other expenses | ' | ' | ' | ' | ' | ' | ' | ' | 499 | 697 | ' |
Interest on subordinated debentures | ' | ' | ' | ' | ' | ' | ' | ' | 809 | 683 | ' |
Total Non-interest Expense | ' | ' | ' | ' | ' | ' | ' | ' | 1,308 | 1,380 | ' |
Income (Loss) Before Income Taxes | ' | ' | ' | ' | ' | ' | ' | ' | -1,283 | -1,360 | ' |
Income tax expense | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | ' |
Equity in undistributed net income (loss) | ' | ' | ' | ' | ' | ' | ' | ' | 3,392 | -14,265 | ' |
Net Income (Loss) | ' | ' | ' | ' | ' | ' | ' | ' | 2,109 | -15,625 | ' |
Cash flows from operating activities: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) | ' | ' | ' | ' | ' | ' | ' | ' | 2,109 | -15,625 | ' |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Undistributed losses from subsidiaries | ' | ' | ' | ' | ' | ' | ' | ' | -3,392 | 14,265 | ' |
Interest on subordinated debentures | ' | ' | ' | ' | ' | ' | ' | ' | -2,419 | 683 | ' |
Net cash provided by operating activities | ' | ' | ' | ' | ' | ' | ' | ' | -3,702 | -677 | ' |
Net cash provided by investing activities | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | ' |
Cash flows from financing activities | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Loan payoffs (fundings) | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 130 | ' |
Other, net | ' | ' | ' | ' | ' | ' | ' | ' | 296 | 185 | ' |
Net cash used in financing activities | ' | ' | ' | ' | ' | ' | ' | ' | 296 | 315 | ' |
Net increase (decrease) in cash and cash equivalents | ' | ' | ' | ' | ' | ' | ' | ' | -3,406 | -362 | ' |
Cash and cash equivalents at beginning of period | ' | ' | ' | 4,739 | ' | ' | ' | 5,101 | 4,739 | 5,101 | ' |
Cash and cash equivalents at end of period | $1,333 | ' | ' | ' | $4,739 | ' | ' | ' | $1,333 | $4,739 | ' |
SUMMARY_OF_QUARTERLY_RESULTS_U2
SUMMARY OF QUARTERLY RESULTS (UNAUDITED) (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | |
Property | ||||||||||
Summary of the consolidated results of operations on a quarterly basis [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest income | $7,069,000 | $6,960,000 | $6,743,000 | $6,752,000 | $6,991,000 | $7,761,000 | $8,423,000 | $8,806,000 | $27,524,000 | $31,981,000 |
Net interest income | 5,379,000 | 5,070,000 | 4,946,000 | 4,772,000 | 4,801,000 | 5,382,000 | 5,906,000 | 5,993,000 | 20,167,000 | 22,082,000 |
(Credit) provision for loan and lease losses | -676,000 | 218,000 | -163,000 | -251,000 | 2,637,000 | 1,761,000 | 1,515,000 | 84,000 | -872,000 | 5,997,000 |
Net Interest Income after (Credit) Provision for Loan and Lease Losses | 6,055,000 | 4,852,000 | 5,109,000 | 5,023,000 | 2,164,000 | 3,621,000 | 4,391,000 | 5,909,000 | 21,039,000 | 16,085,000 |
Other income | 2,558,000 | 1,937,000 | 961,000 | 1,408,000 | -148,000 | 1,151,000 | 1,945,000 | 661,000 | 6,864,000 | 3,609,000 |
Other expenses | 6,333,000 | 6,290,000 | 7,567,000 | 6,140,000 | 10,256,000 | 9,409,000 | 8,592,000 | 8,067,000 | 26,330,000 | 36,324,000 |
Income (Loss) Before Income Taxes | 2,280,000 | 499,000 | -1,497,000 | 291,000 | -8,240,000 | -4,637,000 | -2,256,000 | -1,497,000 | 1,573,000 | -16,630,000 |
Income tax expense | 42,000 | 0 | 0 | 0 | ' | ' | ' | ' | 42,000 | 0 |
Net income (loss) from continuing operations | 2,238,000 | 499,000 | -1,497,000 | 291,000 | -8,240,000 | -4,637,000 | -2,256,000 | -1,497,000 | 1,531,000 | -16,630,000 |
Less net (loss) income attributable to noncontrolling interest | -214,000 | 157,000 | -694,000 | 173,000 | -246,000 | 175,000 | -306,000 | -628,000 | -578,000 | -1,005,000 |
Net income (loss) attributable to Royal Bancshares of Pennsylavania, Inc. | 2,452,000 | 342,000 | -803,000 | 118,000 | -7,994,000 | -4,812,000 | -1,950,000 | -869,000 | 2,109,000 | -15,625,000 |
Net income (loss) available to common shareholders | 1,930,000 | -178,000 | -1,321,000 | -397,000 | -8,507,000 | -5,323,000 | -2,458,000 | -1,375,000 | 34,000 | -17,663,000 |
Net income (loss) per common share [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic and diluted (in dollars per share) | $0.14 | ($0.01) | ($0.10) | ($0.03) | ($0.64) | ($0.40) | ($0.19) | ($0.10) | $0 | ($1.33) |
Quarterly Financial Information, Explanatory Disclosure [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Drop in credit related expenses | 3,600,000 | ' | ' | ' | ' | ' | ' | ' | 7,400,000 | ' |
Decrease in the provision for loan and lease losses | 3,300,000 | ' | ' | ' | ' | ' | ' | ' | 6,900,000 | ' |
Decline in OTTI charge | 1,500,000 | ' | ' | ' | ' | ' | ' | ' | 2,400,000 | ' |
Gain on sale of entity owned buildings | 1,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of entity owned buildings sold | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase in net interest income | $578,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |