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Title of each class: | Trading Symbol | Name of each exchange on which registered: | ||||||||||||
Class A Common Stock | PFHD | NASDAQ Global Select Market |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒Yes☐x Yes oNo
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
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| June 30, |
| December 31, | ||
| | 2021 | | 2020 | ||
ASSETS |
| |
|
| |
|
Cash and due from banks | | $ | 29,803 | | $ | 62,305 |
Interest-bearing deposits | |
| 586,377 | |
| 129,291 |
Federal funds sold | |
| 36,156 | |
| 25,376 |
Cash and cash equivalents | |
| 652,336 | |
| 216,972 |
Securities available for sale, at fair value - taxable | |
| 100,735 | |
| 65,110 |
Securities available for sale, at fair value - tax exempt | | | 19,761 | | | 22,398 |
Securities held to maturity (fair value June 30, 2021 – $1,296, December 31, 2020 – $1,561) | |
| 1,285 | |
| 1,547 |
Equity securities | |
| 5,942 | |
| 6,005 |
Loans, net of allowance of $10,418 and $16,259 as of June 30, 2021 and December 31, 2020, respectively | |
| 1,680,168 | |
| 1,643,373 |
Loans held for sale | | | 2,039 | | | 1,270 |
Federal Home Loan Bank stock, at cost | |
| 2,341 | |
| 3,229 |
Federal Reserve Bank stock, at cost | |
| 4,954 | |
| 4,762 |
Accrued interest receivable | |
| 5,449 | |
| 6,666 |
Premises and equipment, net | |
| 4,000 | |
| 4,370 |
Bank owned life insurance | |
| 37,923 | |
| 37,360 |
Deferred tax asset | | | 9,446 | | | 10,525 |
Goodwill | | | 24,621 | | | 24,621 |
Core deposit intangibles | | | 1,280 | | | 1,422 |
Other assets | |
| 8,738 | |
| 7,640 |
Total assets | | $ | 2,561,018 | | $ | 2,057,270 |
LIABILITIES AND STOCKHOLDERS’ EQUITY | |
| | |
| |
Deposits | |
| | |
| |
Demand – non-interest bearing | | $ | 854,673 | | $ | 475,598 |
Demand – interest bearing | |
| 286,173 | |
| 232,367 |
Money market and savings | | | 874,637 | | | 715,003 |
Time deposits | |
| 261,680 | |
| 236,575 |
Total deposits | |
| 2,277,163 | |
| 1,659,543 |
Official checks | |
| 3,289 | |
| 4,447 |
Federal Home Loan Bank advances | |
| 35,000 | |
| 40,000 |
Other borrowings | | | — | | | 114,573 |
Subordinated debt | | | 10,062 | | | 10,153 |
Accrued interest and other liabilities | |
| 12,476 | |
| 12,989 |
Total liabilities | |
| 2,337,990 | |
| 1,841,705 |
Stockholders’ equity | |
| | |
| |
Preferred stock, 10,000,000 shares authorized, NaN issued | |
| — | |
| — |
Class A Voting Common stock, $0.01 par value; authorized 50,000,000 shares, issued 14,289,480 and outstanding 13,475,781 shares as of June 30, 2021, and authorized 50,000,000 shares, issued 14,100,760 and outstanding 13,534,829 shares at December 31, 2020 | |
| 143 | |
| 141 |
Class B Non-Voting Common stock, $0.01 par value; 10,000,000 shares authorized, NaN issued and outstanding at June 30, 2021 and December 31, 2020 | |
| — | |
| — |
Treasury stock, at cost | |
| (13,544) | |
| (9,209) |
Additional paid-in capital | |
| 210,274 | |
| 208,995 |
Retained earnings | |
| 25,872 | |
| 14,756 |
Accumulated other comprehensive income (loss) | |
| 283 | |
| 882 |
Total stockholders’ equity | |
| 223,028 | |
| 215,565 |
Total liabilities and stockholders' equity | | $ | 2,561,018 | | $ | 2,057,270 |
September 30,
2021December 31,
2020ASSETS Cash and due from banks $ 40,074 $ 62,305 Interest-bearing deposits 680,333 129,291 Federal funds sold 23,736 25,376 Cash and cash equivalents 744,143 216,972 Securities available for sale, at fair value - taxable 94,218 65,110 Securities available for sale, at fair value - tax exempt 19,462 22,398 Securities held to maturity (fair value September 30, 2021 – $269, December 31, 2020 – $1,561) 259 1,547 Equity securities 6,703 6,005 Loans, net of allowance of $11,478 and $16,259 as of September 30, 2021, and December 31, 2020, respectively 1,675,773 1,641,422 Loans held for sale 284 1,270 Federal Home Loan Bank stock, at cost 2,341 3,229 Federal Reserve Bank stock, at cost 5,416 4,762 Accrued interest receivable 5,336 6,666 Premises and equipment, net 3,807 4,370 Bank owned life insurance 38,204 37,360 Deferred tax asset 9,283 10,525 Goodwill 24,621 24,621 Core deposit intangibles 1,212 1,422 Other assets 15,174 9,591 Total assets $ 2,646,236 $ 2,057,270 LIABILITIES AND STOCKHOLDERS’ EQUITY Deposits Demand – noninterest bearing $ 799,389 $ 475,598 Demand – interest bearing 328,667 232,367 Money market and savings 959,066 715,003 Time deposits 267,624 236,575 Total deposits 2,354,746 1,659,543 Official checks 4,194 4,447 Federal Home Loan Bank advances 35,000 40,000 Other borrowings — 114,573 Subordinated debt 10,016 10,153 Accrued interest and other liabilities 14,259 12,989 Total liabilities 2,418,215 1,841,705 Stockholders’ equity Preferred stock, 10,000,000 shares authorized, none issued — — Class A Voting Common stock, $0.01 par value; authorized 50,000,000 shares, issued 14,323,965 and outstanding 13,416,667 shares as of September 30, 2021, and authorized 50,000,000 shares, issued 14,100,760 and outstanding 13,534,829 shares on December 31, 2020 143 141 Class B Non-Voting Common stock, $0.01 par value; 10,000,000 shares authorized, none issued and outstanding on September 30, 2021, and December 31, 2020 — — Treasury stock, at cost (15,246) (9,209) Additional paid-in capital 210,898 208,995 Retained earnings 32,160 14,756 Accumulated other comprehensive income 66 882 Total stockholders’ equity 228,021 215,565 Total liabilities and stockholders' equity $ 2,646,236 $ 2,057,270
| | | | | | | | | | | | | |
| | Three Months Ended June 30, | | | Six Months Ended June 30, | ||||||||
|
| 2021 |
| 2020 |
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| 2021 |
| 2020 | ||||
Interest income | | | | | | | | | | | | | |
Loans, including fees | | $ | 18,311 | | $ | 17,897 | | | $ | 37,544 | | $ | 27,912 |
Investment securities - taxable | |
| 161 | |
| 232 | | |
| 340 | |
| 434 |
Investment securities - tax exempt | | | 189 | | | 206 | | | | 392 | | | 226 |
Dividend income on restricted stock | |
| 99 | |
| 131 | | |
| 194 | |
| 210 |
Other | |
| 202 | |
| 56 | | |
| 264 | |
| 760 |
Total interest income | |
| 18,962 | |
| 18,522 | | |
| 38,734 | |
| 29,542 |
| | | | | | | | | | | | | |
Interest expense | |
| | |
|
| | |
| | |
|
|
Deposits | |
| 1,430 | |
| 1,617 | | |
| 2,747 | |
| 4,243 |
Federal Home Loan Bank advances | |
| 190 | |
| 287 | | |
| 386 | |
| 565 |
Subordinated debt | | | 77 | | | 59 | | | | 207 | | | 189 |
Other borrowings | | | 63 | | | 268 | | | | 313 | | | 193 |
Total interest expense | |
| 1,760 | |
| 2,231 | | |
| 3,653 | |
| 5,190 |
| | | | | | | | | | | | | |
Net interest income | |
| 17,202 | |
| 16,291 | | |
| 35,081 | |
| 24,352 |
Provision for loan losses | |
| 762 | |
| 1,750 | | |
| 1,800 | |
| 2,595 |
Net interest income after provision for loan losses | |
| 16,440 | |
| 14,541 | | |
| 33,281 | |
| 21,757 |
| | | | | | | | | | | | | |
Non-interest income | |
| | |
|
| | |
| | |
|
|
Service charges on deposit accounts | |
| 1,199 | |
| 307 | | |
| 1,594 | |
| 529 |
Income from Bank owned life insurance | |
| 281 | |
| 126 | | |
| 563 | |
| 255 |
SBA origination fees | | | — | | | 84 | | | | 145 | | | 114 |
SWAP fees | | | 364 | | | 210 | | | | 573 | | | 473 |
Third party loan sales | | | 226 | | | 157 | | | | 301 | | | 267 |
Gain on sale and call of securities | | | 21 | | | 11 | | | | 22 | | | 15 |
Other | |
| 211 | |
| 73 | | |
| 223 | |
| 171 |
Total non-interest income | |
| 2,302 | |
| 968 | | |
| 3,421 | |
| 1,824 |
| | | | | | | | | | | | | |
Non-interest expense | |
| | |
|
| | |
| | |
| |
Salaries and employee benefits | |
| 7,099 | |
| 6,912 | | |
| 13,883 | |
| 12,175 |
Occupancy and equipment | |
| 905 | |
| 1,081 | | |
| 2,007 | |
| 1,855 |
Data processing | |
| 276 | |
| 421 | | |
| 566 | |
| 597 |
Marketing | |
| 165 | |
| 151 | | |
| 318 | |
| 288 |
Professional fees | |
| 770 | |
| 806 | | |
| 1,398 | |
| 1,161 |
Acquisition expenses | | | — | | | 560 | | | | 684 | | | 2,223 |
Regulatory assessments | |
| 418 | |
| 300 | | |
| 767 | |
| 514 |
Other | |
| 1,321 | |
| 1,317 | | |
| 3,119 | |
| 2,221 |
Total non-interest expense | |
| 10,954 | |
| 11,548 | | |
| 22,742 | |
| 21,034 |
| | | | | | | | | | | | | |
Income before income taxes | |
| 7,788 | |
| 3,961 | | |
| 13,960 | |
| 2,547 |
Income tax provision | |
| 1,457 | |
| 830 | | |
| 2,844 | |
| 733 |
Net income | |
| 6,331 | |
| 3,131 | | |
| 11,116 | |
| 1,814 |
| | | | | | | | | | | | | |
Earnings per share: | |
| | |
|
| | |
| | |
|
|
Basic | | $ | 0.47 | | $ | 0.23 | | | $ | 0.83 | | $ | 0.16 |
Diluted | | $ | 0.45 | | $ | 0.22 | | | $ | 0.80 | | $ | 0.15 |
| | | | | | | | | | | | | |
Other comprehensive income: | |
| | |
|
| | |
| | |
|
|
Unrealized holding gain (loss) on securities available for sale | |
| (505) | |
| 743 | | |
| (794) | |
| 1,068 |
Tax effect | |
| 124 | |
| (188) | | |
| 195 | |
| (271) |
Other comprehensive gain (loss), net of tax | |
| (381) | |
| 555 | | |
| (599) | |
| 797 |
Comprehensive income | | $ | 5,950 | | $ | 3,686 | | | $ | 10,517 | | $ | 2,611 |
Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Interest income Loans, including fees $ 20,209 $ 18,488 $ 57,753 $ 46,400 Investment securities - taxable 186 209 526 663 Investment securities - tax exempt 177 224 569 430 Dividend income on restricted stock 96 103 290 313 Other 222 77 486 837 Total interest income 20,890 19,101 59,624 48,643 Interest expense Deposits 1,476 1,165 4,223 5,408 Federal Home Loan Bank advances 182 197 568 762 Subordinated debt 128 79 335 324 Other borrowings — 200 313 337 Total interest expense 1,786 1,641 5,439 6,831 Net interest income 19,104 17,460 54,185 41,812 Provision for loan losses 1,060 5,957 2,860 8,552 Net interest income after provision for loan losses 18,044 11,503 51,325 33,260 Non-interest income Service charges on deposit accounts 643 319 2,237 848 Income from Bank owned life insurance 281 123 844 378 SBA origination fees 21 — 166 114 SWAP fee income 208 149 781 622 Third party loan sales 161 252 462 519 Gain on sale and call of securities 1 1 23 16 Other 161 119 384 290 Total non-interest income 1,476 963 4,897 2,787 Non-interest expense Salaries and employee benefits 7,350 6,433 21,233 18,608 Occupancy and equipment 935 1,196 2,942 3,051 Data processing 303 374 869 971 Marketing 420 435 738 723 Professional fees 689 562 2,087 1,723 Acquisition expenses — 1,078 684 3,301 Regulatory assessments 481 250 1,248 764 Other 1,446 1,385 4,565 3,606 Total non-interest expense 11,624 11,713 34,366 32,747 Income before income taxes 7,896 753 21,856 3,300 Income tax provision (benefit) 1,608 (197) 4,452 536 Net income 6,288 950 17,404 2,764 Earnings per share: Basic $ 0.48 $ 0.07 $ 1.30 $ 0.24 Diluted $ 0.45 $ 0.07 $ 1.25 $ 0.21 Other comprehensive income: Unrealized holding gain (loss) on securities available for sale (288) 171 (1,081) 1,240 Tax effect 71 (43) 265 (315) Other comprehensive gain (loss), net of tax (217) 128 (816) 925 Comprehensive income $ 6,071 $ 1,078 $ 16,588 $ 3,689
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | Accumulated | | | | |
| | | | | | | | | | Additional | | | | | Other | | | | ||
| | Common Stock | | Treasury | | Paid-in | | Retained | | Comprehensive | | | | |||||||
| | Shares | | Amount | | Stock | | Capital | | Earnings |
| Income (Loss) | | Total | ||||||
Balance at April 1, 2020 | | 13,537,565 | | $ | 138 | | $ | (6,257) | | $ | 201,670 | | $ | 5,134 | | $ | 169 | | $ | 200,854 |
Issuance of common stock, net of issuance cost |
| 89,167 | |
| 1 |
| | — |
| | 450 |
| | — |
| | — |
| | 451 |
Employee stock purchase plan |
| — | |
| — |
| | — |
| | 27 |
| | — |
| | — |
| | 27 |
Stock based compensation |
| — | |
| — |
| | — |
| | 296 |
| | — |
| | — |
| | 296 |
Treasury stock |
| (182,097) | |
| — |
| | (2,875) |
| | (5) |
| | — |
| | — |
| | (2,880) |
Net loss |
| — | |
| — |
| | — |
| | — |
| | 3,131 |
| | — |
| | 3,131 |
Other comprehensive income |
| — | |
| — |
| | — |
| | — |
| | — |
| | 555 |
| | 555 |
Balance at June 30, 2020 |
| 13,444,635 | | $ | 139 | | $ | (9,132) | | $ | 202,438 | | $ | 8,265 | | $ | 724 | | $ | 202,434 |
| | | | | | | | | | | | | | | | | | | | |
Balance at April 1, 2021 | | 13,661,567 | | $ | 143 | | $ | (10,087) | | $ | 209,770 | | $ | 19,541 | | $ | 664 | | $ | 220,031 |
Issuance of common stock, net of issuance cost |
| 8,359 | |
| — |
| | — |
| | 107 |
| | — |
| | — |
| | 107 |
Employee stock purchase plan |
| 978 | |
| — |
| | — |
| | 18 |
| | — |
| | — |
| | 18 |
Stock based compensation |
| (1,834) | |
| — |
| | — |
| | 385 |
| | — |
| | — |
| | 385 |
Treasury stock |
| (193,289) | |
| — |
| | (3,457) |
| | (6) |
| | — |
| | — |
| | (3,463) |
Net income |
| — | |
| — |
| | — |
| | — |
| | 6,331 |
| | — |
| | 6,331 |
Other comprehensive income |
| — | |
| — |
| | — |
| | — |
| | — |
| | (381) |
| | (381) |
Balance at June 30, 2021 |
| 13,475,781 | | $ | 143 | | $ | (13,544) | | $ | 210,274 | | $ | 25,872 | | $ | 283 | | $ | 223,028 |
| | | | | | | | | | | | | | | | | | | | |
Balance at January 1, 2020 | | 5,867,446 | | $ | 60 | | $ | (4,155) | | $ | 77,019 | | $ | 6,451 | | $ | (73) | | $ | 79,302 |
Issuance of common stock, net of issuance cost |
| 3,664,667 | |
| 37 |
| | — |
| | 60,221 |
| | — |
| | — |
| | 60,258 |
Marquis Bancorp (MBI) acquisition | | 4,227,816 | | | 42 | | | — | | | 64,657 | | | — | | | — | | | 64,699 |
Employee stock purchase plan |
| — | |
| — |
| | — |
| | 58 |
| | — |
| | — |
| | 58 |
Stock based compensation |
| — | |
| — |
| | — |
| | 492 |
| | — |
| | — |
| | 492 |
Treasury stock |
| (315,294) | |
| — |
| | (4,977) |
| | (9) |
| | — |
| | — |
| | (4,986) |
Net loss |
| — | |
| — |
| | — |
| | — |
| | 1,814 |
| | — |
| | 1,814 |
Other comprehensive income |
| — | |
| — |
| | — |
| | — |
| | — |
| | 797 |
| | 797 |
Balance at June 30, 2020 |
| 13,444,635 | | $ | 139 | | $ | (9,132) | | $ | 202,438 | | $ | 8,265 | | $ | 724 | | $ | 202,434 |
| | | | | | | | | | | | | | | | | | | | |
Balance at January 1, 2021 |
| 13,534,829 | | $ | 141 | | $ | (9,209) | | $ | 208,995 | | $ | 14,756 | | $ | 882 | | $ | 215,565 |
Issuance of common stock, net of issuance cost |
| 61,204 | |
| 1 |
| | — |
| | 543 |
| | — |
| | — |
| | 544 |
Employee stock purchase plan |
| 1,851 | |
| — |
| | — |
| | 34 |
| | — |
| | — |
| | 34 |
Stock based compensation |
| 125,665 | |
| 1 |
| | — |
| | 709 |
| | — |
| | — |
| | 710 |
Treasury stock |
| (247,768) | |
| — |
| | (4,335) |
| | (7) |
| | — |
| | — |
| | (4,342) |
Net income |
| — | |
| — |
| | — |
| | — |
| | 11,116 |
| | — |
| | 11,116 |
Other comprehensive income |
| — | |
| — |
| | — |
| | — |
| | — |
| | (599) |
| | (599) |
Balance at June 30, 2021 |
| 13,475,781 | | $ | 143 |
| $ | (13,544) |
| $ | 210,274 |
| $ | 25,872 |
| $ | 283 |
| $ | 223,028 |
Common Stock Treasury
StockAdditional
Paid-in
CapitalRetained
EarningsAccumulated
Other
Comprehensive
Income (Loss)Total Shares Amount Balance on July 1, 2020 13,444,635 $ 139 $ (9,132) $ 202,438 $ 8,265 $ 724 $ 202,434 Issuance of common stock, net of issuance cost 37,891 — — 346 — — 346 Employee stock purchase plan — — — 24 — — 24 Stock based compensation — — — 233 — — 233 Treasury stock — — — — — — — Net income — — — — 950 — 950 Other comprehensive income — — — — — 128 128 Balance on September 30, 2020 13,482,526 $ 139 $ (9,132) $ 203,041 $ 9,215 $ 852 $ 204,115 Balance on July 1, 2021 13,475,781 $ 143 $ (13,544) $ 210,274 $ 25,872 $ 283 $ 223,028 Issuance of common stock, net of issuance cost 28,296 — — 268 — — 268 Employee stock purchase plan — — — — — — — Stock based compensation 6,189 — — 359 — — 359 Treasury stock (93,599) — (1,702) (3) — — (1,705) Net income — — — — 6,288 — 6,288 Other comprehensive income — — — — — (217) (217) Balance on September 30, 2021 13,416,667 $ 143 $ (15,246) $ 210,898 $ 32,160 $ 66 $ 228,021 Balance on January 1, 2020 5,867,446 $ 60 $ (4,155) $ 77,019 $ 6,451 $ (73) $ 79,302 Issuance of common stock, net of issuance cost 3,702,558 37 — 60,567 — — 60,604 Marquis Bancorp (MBI) acquisition 4,227,816 42 — 64,657 — — 64,699 Employee stock purchase plan — — — 82 — — 82 Stock based compensation — — — 725 — — 725 Treasury stock (315,294) — (4,977) (9) — — (4,986) Net income — — — — 2,764 — 2,764 Other comprehensive income — — — — — 925 925 Balance on September 30, 2020 13,482,526 $ 139 $ (9,132) $ 203,041 $ 9,215 $ 852 $ 204,115 Balance on January 1, 2021 13,534,829 $ 141 $ (9,209) $ 208,995 $ 14,756 $ 882 $ 215,565 Issuance of common stock, net of issuance cost 89,500 1 — 811 — — 812 Employee stock purchase plan 1,851 — — 34 — — 34 Stock based compensation 131,854 1 — 1,068 — — 1,069 Treasury stock (341,367) — (6,037) (10) — — (6,047) Net income — — — — 17,404 — 17,404 Other comprehensive income — — — — — (816) (816) Balance on September 30, 2021 13,416,667 $ 143 $ (15,246) $ 210,898 $ 32,160 $ 66 $ 228,021
| | | | | | |
| | Six Months Ended June 30, | ||||
|
| 2021 |
| 2020 | ||
Cash flows from operating activities |
| |
|
| |
|
Net income (loss) | | $ | 11,116 | | $ | 1,814 |
Adjustments to reconcile net income to net cash from operating activities | |
|
| |
|
|
Provision for loan losses | |
| 1,800 | |
| 2,595 |
Deferred income tax benefit (expense) | |
| 988 | |
| (499) |
Depreciation and amortization | |
| 739 | |
| 739 |
Gain on sale of securities | | | — | | | (4) |
Gain on call of securities | | | (22) | | | (11) |
Equity unrealized change in market value | | | 63 | | | (24) |
Net amortization of securities | |
| 1,396 | |
| (906) |
Net amortization of deferred loan fees | |
| (4,400) | |
| 1,118 |
Loans held for sale | | | (769) | | | (1,070) |
Proceeds from sale of loans | | | — | | | 110 |
Income from bank owned life insurance | |
| (563) | |
| (255) |
Loss on disposal of premises and equipment | | | 137 | | | — |
Employee stock purchase plan | | | 34 | | | 58 |
Stock compensation | |
| 710 | |
| 492 |
Changes in operating assets and liabilities: | |
|
| |
|
|
Accrued interest receivable | |
| 1,217 | |
| (1,472) |
Other assets | |
| (1,098) | |
| 1,887 |
Official checks, accrued interest, interest payable and other liabilities | |
| (1,385) | |
| (3,395) |
Net cash provided by operating activities | |
| 9,963 | |
| 1,177 |
| | | | | | |
Cash flows from investing activities | |
|
| |
|
|
Proceeds from maturities and paydowns of securities available for sale | |
| 11,123 | |
| 6,256 |
Proceeds from calls of securities available for sale | | | 4,648 | | | 4,835 |
Proceeds from maturities and paydowns of securities held to maturity | |
| 257 | |
| 44 |
Purchase of securities available for sale | |
| (50,922) | |
| (60,693) |
Proceeds from sale of securities available for sale | | | — | | | 1,739 |
Loans originations, net of principal repayments | |
| (47,410) | |
| (256,731) |
Purchase of Federal Reserve Bank stock | |
| (192) | |
| (2,671) |
Proceeds from maturities of Federal Home Loan Bank Stock | | | 888 | | | — |
Purchase of Federal Home Loan Bank Stock | |
| — | |
| (1,297) |
Purchases of premises and equipment | |
| (455) | |
| (741) |
Proceeds from acquisition | | | — | | | 26,860 |
Net cash used in investing activities | |
| (82,063) | |
| (282,399) |
| | | | | | |
Cash flows from financing activities | |
|
| |
|
|
Net increase (decrease) in deposits | |
| 617,620 | |
| 126,404 |
Proceeds from issuance of stock, net of issuance costs | |
| 544 | |
| 60,258 |
Purchase of treasury stock | | | (4,342) | | | (4,986) |
Proceeds from Federal Home Loan Bank advances | |
| — | |
| 10,000 |
Repayments of Federal Home Loan advances | |
| (5,000) | |
| (25,000) |
Repayment of line of credit | | | — | | | (9,999) |
Proceeds from PPPLF advances | | | — | | | 218,080 |
Repayments of PPPLF advances | | | (101,358) | | | — |
Net cash provided by financing activities | |
| 507,464 | |
| 374,757 |
| | | | | | |
Increase in cash and cash equivalents | |
| 435,364 | |
| 93,535 |
| | | | | | |
Cash and cash equivalents at beginning of period | |
| 216,972 | |
| 198,950 |
| | | | | | |
Cash and cash equivalents at end of period | | $ | 652,336 | | $ | 292,485 |
| | | | | | |
Supplemental cash flow information: | |
|
| |
|
|
Cash paid during the period for interest | | $ | 4,425 | | $ | 4,907 |
Cash paid during the period for taxes | |
| 3,000 | |
| 20 |
| | | | | | |
Supplemental noncash disclosures: | |
|
| |
|
|
Lease liabilities arising from obtaining right of use assets | | $ | — | | $ | 1,620 |
Total assets acquired | | | — | | | 589,374 |
Total liabilities assumed | | | — | | | 539,403 |
Nine Months Ended September 30, 2021 2020 Cash flows from operating activities Net income $ 17,404 $ 2,764 Adjustments to reconcile net income to net cash from operating activities Provision for loan losses 2,860 8,552 Deferred income tax benefit (expense) 1,221 (2,981) Depreciation and amortization 1,084 1,132 Gain on sale of securities — (4) Gain on call of securities (23) (12) Equity unrealized change in market value 102 (24) Net amortization of securities 2,137 (287) Net amortization of deferred loan fees (6,589) (2,371) Loans held for sale 986 — Income from bank owned life insurance (844) (378) Loss on disposal of premises and equipment 140 — Employee stock purchase plan 34 82 Stock compensation 1,069 725 Changes in operating assets and liabilities: Accrued interest payable (receivable) 1,330 (2,524) Other assets (7,534) 3,110 Official checks, accrued interest, interest payable and other liabilities 1,303 (2,054) Net cash provided by operating activities 14,680 5,730 Cash flows from investing activities Proceeds from maturities and paydowns of securities available for sale 16,749 10,407 Proceeds from calls of securities available for sale 4,812 8,500 Proceeds from maturities and paydowns of securities held to maturity 1,282 84 Purchase of securities available for sale (50,922) (60,693) Proceeds from sale of securities available for sale — 1,739 Purchase of equity securities (800) — Loans originations, net of principal repayments (41,886) (299,867) Purchase (redemption) of Federal Reserve Bank stock (654) 10,540 Proceeds from maturities of Federal Home Loan Bank Stock 888 (2,688) Purchase of Federal Home Loan Bank Stock — (660) Purchases of premises and equipment (588) (486) Proceeds from acquisition — 26,860 Net cash used in investing activities (71,119) (306,264) Cash flows from financing activities Net increase (decrease) in deposits 695,203 176,160 Proceeds from issuance of stock, net of issuance costs 812 60,604 Purchase of treasury stock (6,047) (4,986) Proceeds from Federal Home Loan Bank advances — 10,000 Repayments of Federal Home Loan advances (5,000) (40,000) Repayment of line of credit — (9,999) Proceeds from PPPLF advances — 224,341 Repayments of PPPLF advances (101,358) — Net cash provided by financing activities 583,610 416,120 Increase in cash and cash equivalents 527,171 115,586 Cash and cash equivalents at beginning of period 216,972 198,950 Cash and cash equivalents at end of period $ 744,143 $ 314,536 Supplemental cash flow information: Cash paid during the period for interest $ 6,192 $ 6,233 Cash paid during the period for taxes 4,200 2,186 Supplemental noncash disclosures: Lease liabilities arising from obtaining right of use assets $ — $ 1,680 Total assets acquired — 589,760 Total liabilities assumed — 540,712
7
New accounting standards that have not yet been adopted:
|
| ||||
ASU 2016-13, Financial Instruments – Credit Losses (Topic 326) | |||||
Description | In June 2016, FASB issued guidance to replace the incurred loss model with an expected loss model, which is referred to as the current expected credit loss | ||||
Date of Adoption | For PBEs that are non-SEC filers and for SEC filers that are considered small reporting companies, it is effective for January 1, 2023. Early adoption is still permitted. | ||||
Effect on the Consolidated Financial Statements | The Company's management is in the process of evaluating credit loss estimation models. Updates to business processes and the documentation of accounting policy decisions are ongoing. The company may recognize an increase in the allowance for credit losses upon adoption, recorded as a one-time cumulative adjustment to retained earnings. However, the magnitude of the impact on the Company's consolidated financial statements has not yet been determined. The Company will adopt this accounting standard effective January 1, 2023. |
| | | | | | | | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, | ||||||||
|
| 2021 |
| 2020 | | 2021 |
| 2020 | ||||
Basic earnings per share: |
| |
|
| |
| | |
|
| |
|
Net income | | $ | 6,331 | | $ | 3,131 | | $ | 11,116 | | $ | 1,814 |
Total weighted average common stock outstanding | |
| 13,397,747 | |
| 13,415,525 | |
| 13,419,929 | |
| 11,516,756 |
Net income per share | | $ | 0.47 | | $ | 0.23 | | $ | 0.83 | | $ | 0.16 |
Diluted earnings per share: | |
| | |
| | |
| | |
| |
Net income | | $ | 6,331 | | $ | 3,131 | | $ | 11,116 | | $ | 1,814 |
Total weighted average common stock outstanding | |
| 13,397,747 | |
| 13,415,525 | |
| 13,419,929 | |
| 11,516,756 |
Add: Dilutive effect of employee stock options | | | 564,822 | | | 518,435 | | | 521,900 | | | 526,503 |
Total weighted average diluted stock outstanding | | | 13,962,569 | | | 13,933,960 | | | 13,941,829 | | | 12,043,259 |
Net income per share | | $ | 0.45 | | $ | 0.22 | | $ | 0.80 | | $ | 0.15 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Basic earnings per share: | |||||||||||||||||||||||
Net income | $ | 6,288 | $ | 950 | $ | 17,404 | $ | 2,764 | |||||||||||||||
Total weighted average common stock outstanding | 13,196,025 | 13,438,652 | 13,344,470 | 11,694,764 | |||||||||||||||||||
Net income per share | $ | 0.48 | $ | 0.07 | $ | 1.30 | $ | 0.24 | |||||||||||||||
Diluted earnings per share: | |||||||||||||||||||||||
Net income | $ | 6,288 | $ | 950 | $ | 17,404 | $ | 2,764 | |||||||||||||||
Total weighted average common stock outstanding | 13,196,025 | 13,438,652 | 13,344,470 | 11,694,764 | |||||||||||||||||||
Add: Dilutive effect of employee stock options | 659,402 | 1,117,563 | 568,613 | 1,290,819 | |||||||||||||||||||
Total weighted average diluted stock outstanding | 13,855,427 | 14,556,215 | 13,913,083 | 12,985,583 | |||||||||||||||||||
Net income per share | $ | 0.45 | $ | 0.07 | $ | 1.25 | $ | 0.21 |
September 30, 2021 | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||||||||||||
Available-for-sale - taxable | ||||||||||||||||||||||||||
Small Business Administration loan pools | $ | 40,131 | $ | 62 | $ | (490) | $ | 39,703 | ||||||||||||||||||
Mortgage-backed securities | 51,105 | 162 | (340) | 50,927 | ||||||||||||||||||||||
United States agency obligations | 2,002 | 77 | — | 2,079 | ||||||||||||||||||||||
Corporate bonds | 1,500 | 9 | — | 1,509 | ||||||||||||||||||||||
Total available-for-sale - taxable | $ | 94,738 | $ | 310 | $ | (830) | $ | 94,218 | ||||||||||||||||||
Available-for-sale - tax exempt | ||||||||||||||||||||||||||
Community Development District bonds | $ | 17,800 | $ | 564 | $ | — | $ | 18,364 | ||||||||||||||||||
Municipals | 1,054 | 44 | — | 1,098 | ||||||||||||||||||||||
Total available-for-sale - tax exempt | $ | 18,854 | $ | 608 | $ | — | $ | 19,462 | ||||||||||||||||||
Amortized Cost | Gross Unrecognized Gains | Gross Unrecognized Losses | Fair Value | |||||||||||||||||||||||
Held-to-Maturity | ||||||||||||||||||||||||||
Mortgage-backed securities | $ | 259 | $ | 10 | $ | — | $ | 269 | ||||||||||||||||||
Total Held-to-Maturity | $ | 259 | $ | 10 | $ | — | $ | 269 |
Amortized Cost | Gross Unrecognized Gains | Gross Unrecognized Losses | Fair Value | |||||||||||||||||||||||
Equity | ||||||||||||||||||||||||||
Mutual Funds | $ | 5,903 | $ | — | $ | — | $ | 5,903 | ||||||||||||||||||
Other equity securities | 800 | — | — | 800 | ||||||||||||||||||||||
Total Equity | $ | 6,703 | $ | — | $ | — | $ | 6,703 |
| | | | | | | | | | | | |
|
| | |
| Gross |
| Gross |
| | | ||
| | Amortized | | Unrealized | | Unrealized | | | | |||
June 30, 2021 | | Cost | | Gains | | Losses | | Fair Value | ||||
Available-for-sale - taxable | | | | | | | | | | | | |
Small Business Administration loan pools | | $ | 43,091 | | $ | 78 | | $ | (573) | | $ | 42,596 |
Mortgage-backed securities | |
| 54,517 | |
| 205 | |
| (182) | |
| 54,540 |
United States agency obligations | | | 2,001 | | | 88 | | | - | | | 2,089 |
Corporate bonds | |
| 1,500 | |
| 10 | |
| - | |
| 1,510 |
Total available-for-sale - taxable | | $ | 101,109 | | $ | 381 | | $ | (755) | | $ | 100,735 |
Available-for-sale - tax exempt | | | | | | | | | | | | |
Community Development District bonds | | $ | 17,954 | | $ | 704 | | $ | - | | $ | 18,658 |
Municipals | | | 1,057 | | | 46 | | | - | | | 1,103 |
Total available-for-sale - tax exempt | | $ | 19,011 | | $ | 750 | | $ | - | | $ | 19,761 |
| | | | | | | | | | | | |
|
| | |
| Gross |
| Gross |
|
| | ||
| | Amortized | | Unrecognized | | Unrecognized | | | | |||
| | Cost | | Gains | | Losses | | Fair Value | ||||
Held-to-Maturity | |
|
| |
|
| |
|
| |
|
|
Mortgage-backed securities | | $ | 285 | | $ | 11 | | $ | — | | $ | 296 |
Foreign Bonds | | | 1,000 | | | — | | | — | | | 1,000 |
Total Held-to-Maturity | | $ | 1,285 | | $ | 11 | | $ | — | | $ | 1,296 |
| | | | | | | | | | | | |
|
| | |
| Gross |
| Gross |
| | | ||
| | Amortized | | Unrealized | | Unrealized | | Fair | ||||
December 31, 2020 | | Cost | | Gains | | Losses | | Value | ||||
Available-for-sale - taxable |
| |
|
| |
|
| |
|
| |
|
Small Business Administration loan pools | | $ | 30,678 | | $ | 77 | | $ | (199) | | $ | 30,556 |
Mortgage-backed securities | |
| 28,514 | |
| 438 | |
| (30) | |
| 28,922 |
United States agency obligations | | | 3,000 | | | 122 | | | - | | | 3,122 |
Corporate bonds | |
| 2,501 | |
| 9 | |
| - | |
| 2,510 |
Total available-for-sale - taxable | | $ | 64,693 | | $ | 646 | | $ | (229) | | $ | 65,110 |
Available-for-sale - tax exempt | | | | | | | | | | | | |
Community Development District bonds | | $ | 20,582 | | $ | 717 | | $ | - | | $ | 21,299 |
Municipals | | | 1,064 | | | 35 | | | - | | | 1,099 |
Total available-for-sale - tax exempt | | $ | 21,646 | | $ | 752 | | $ | - | | $ | 22,398 |
| | | | | | | | | | | | |
|
| | |
| Gross |
| Gross | | | | ||
| | Amortized | | Unrecognized | | Unrecognized | | Fair | ||||
| | Cost | | Gains | | Losses |
| Value | ||||
Held-to-Maturity |
| |
|
| |
|
| |
|
| |
|
Mortgage-backed securities | | $ | 345 | | $ | 14 | | $ | — | | $ | 359 |
United States Treasury | | | 202 | | | — | | | — | | | 202 |
Foreign Bonds | | | 1,000 | | | — | | | — | | | 1,000 |
Total Held-to-Maturity | | $ | 1,547 | | $ | 14 | | $ | — | | $ | 1,561 |
December 31, 2020 | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||||||||||||
Available-for-sale - taxable | ||||||||||||||||||||||||||
Small Business Administration loan pools | $ | 30,678 | $ | 77 | $ | (199) | $ | 30,556 | ||||||||||||||||||
Mortgage-backed securities | 28,514 | 438 | (30) | 28,922 | ||||||||||||||||||||||
United States agency obligations | 3,000 | 122 | — | 3,122 | ||||||||||||||||||||||
Corporate bonds | 2,501 | 9 | — | 2,510 | ||||||||||||||||||||||
Total available-for-sale - taxable | $ | 64,693 | $ | 646 | $ | (229) | $ | 65,110 | ||||||||||||||||||
Available-for-sale - tax exempt | ||||||||||||||||||||||||||
Community Development District bonds | $ | 20,582 | $ | 717 | $ | — | $ | 21,299 | ||||||||||||||||||
Municipals | 1,064 | 35 | — | 1,099 | ||||||||||||||||||||||
Total available-for-sale - tax exempt | $ | 21,646 | $ | 752 | $ | — | $ | 22,398 | ||||||||||||||||||
Amortized Cost | Gross Unrecognized Gains | Gross Unrecognized Losses | Fair Value | |||||||||||||||||||||||
Held-to-Maturity | ||||||||||||||||||||||||||
Mortgage-backed securities | $ | 345 | $ | 14 | $ | — | $ | 359 | ||||||||||||||||||
United States Treasury | 202 | — | — | 202 | ||||||||||||||||||||||
Foreign Bonds | 1,000 | — | — | 1,000 | ||||||||||||||||||||||
Total Held-to-Maturity | $ | 1,547 | $ | 14 | $ | — | $ | 1,561 |
9
were $1.7 million, with gross realized gains of $4 thousand. Proceeds from redemption of securities for the year ended December 31, 2020, were $9.1 million, with gross realized gains of $33 thousand. Total securities pledged as of JuneSeptember 30, 2021, and December 31, 2020, were $13.3$1.9 million and $12.5 million, respectively. Securities pledged for derivative SWAP transactions as of JuneSeptember 30, 2021, were $1.1$1.9 million which were included in the total securities pledged, such securities were generally pledged for public funds. There were no securities pledged for derivatederivative SWAP transactions aton December 31, 2020.
| | | | | | |
| | June 30, 2021 | ||||
|
| Amortized |
| Fair | ||
| | Cost | | Value | ||
Available-for-sale | | | | | | |
Due in one year or less | | $ | 1,038 | | $ | 1,056 |
Due after one year through five years | |
| 21,159 | |
| 21,975 |
Due after five years through ten years | | | 315 | | | 329 |
Due after ten years | | | — | | | — |
Subtotal | | $ | 22,512 | | $ | 23,360 |
| | | | | | |
Small Business Administration loan pools | | $ | 43,091 | | $ | 42,596 |
Mortgage-backed securities | | | 54,517 | | | 54,540 |
Total available-for-sale | | $ | 120,120 | | $ | 120,496 |
| | | | | | |
Held-to-maturity | | | | | | |
Due in one year or less | | $ | 1,000 | | $ | 1,000 |
Due after one year through five years | | | — | | | — |
Subtotal | | $ | 1,000 | | $ | 1,000 |
| | | | | | |
Mortgage-backed securities | | $ | 285 | | $ | 296 |
Total held-to-maturity | | $ | 1,285 | | $ | 1,296 |
At June
September 30, 2021 | |||||||||||
Amortized Cost | Fair Value | ||||||||||
Available-for-sale | |||||||||||
Due in one year or less | $ | 1,188 | $ | 1,202 | |||||||
Due after one year through five years | 20,853 | 21,523 | |||||||||
Due after five years through ten years | 315 | 325 | |||||||||
Due after ten years | — | — | |||||||||
Subtotal | $ | 22,356 | $ | 23,050 | |||||||
Small Business Administration loan pools | $ | 40,131 | $ | 39,703 | |||||||
Mortgage-backed securities | 51,105 | 50,927 | |||||||||
Total available-for-sale | $ | 113,592 | $ | 113,680 | |||||||
Mortgage-backed securities | $ | 259 | $ | 269 | |||||||
Total held-to-maturity | $ | 259 | $ | 269 |
At June
10
losses were outstanding at Juneon September 30, 2021, and December 31, 2020, respectively, aggregated by major security type and length of time in a continuous unrealized loss position:
| | | | | | | | | | | | | | | | | | |
| | Less Than 12 Months | | 12 Months or Longer | | Total | ||||||||||||
|
| Fair |
| Unrealized |
| Fair |
| Unrealized |
| Fair |
| Unrealized | ||||||
| | Value | | Losses | | Value | | Losses | | Value | | Losses | ||||||
June 30, 2021 | | | | | | | | | | | | | | | | | | |
Available-for-sale - taxable | | | | | | | | | | | | | | | | | | |
Small Business Administration loan pools | | $ | 15,273 | | $ | (427) | | $ | 17,777 | | $ | (146) | | $ | 33,050 | | $ | (573) |
Mortgage-backed securities | |
| 14,648 | |
| (181) | |
| 1,286 | |
| (1) | |
| 15,934 | |
| (182) |
United States agency obligations | | | — | | | — | | | — | | | — | | | — | | | — |
Corporate bonds | |
| — | |
| — | |
| — | |
| — | |
| — | |
| — |
Total available-for-sale - taxable | | $ | 29,921 | | $ | (608) | | $ | 19,063 | | $ | (147) | | $ | 48,984 | | $ | (755) |
Available-for-sale - tax exempt | | | | | | | | | | | | | | | | | | |
Community Development District bonds | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — |
Municipals | | | — | | | — | | | — | | | — | | | — | | | — |
Total available-for-sale - tax exempt | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — |
| | | | | | | | | | | | | | | | | | |
December 31, 2020 | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Available-for-sale - taxable | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Small Business Administration loan pools | | $ | 18,849 | | $ | (133) | | $ | 8,945 | | $ | (66) | | $ | 27,794 | | $ | (199) |
Mortgage-backed securities | |
| 5,839 | |
| — | |
| 2,510 | |
| (30) | |
| 8,349 | |
| (30) |
United States agency obligations | | | 227 | | | — | | | — | | | — | | | 227 | | | — |
Corporate bonds | |
| — | |
| — | |
| — | |
| — | |
| — | |
| — |
Total available-for-sale - taxable | | $ | 24,915 | | $ | (133) | | $ | 11,455 | | $ | (96) | | $ | 36,370 | | $ | (229) |
Available-for-sale - tax exempt | | | | | | | | | | | | | | | | | | |
Community Development District bonds | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — |
Municipals | | | — | | | — | | | — | | | — | | | — | | | — |
Total available-for-sale - tax exempt | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — |
Less Than 12 Months | 12 Months or Longer | Total | |||||||||||||||||||||||||||||||||
Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | ||||||||||||||||||||||||||||||
September 30, 2021 | |||||||||||||||||||||||||||||||||||
Available-for-sale - taxable | |||||||||||||||||||||||||||||||||||
Small Business Administration loan pools | $ | 14,640 | $ | (359) | $ | 16,127 | $ | (131) | $ | 30,767 | $ | (490) | |||||||||||||||||||||||
Mortgage-backed securities | 33,019 | (340) | — | — | 33,019 | (340) | |||||||||||||||||||||||||||||
Total available-for-sale - taxable | $ | 47,659 | $ | (699) | $ | 16,127 | $ | (131) | $ | 63,786 | $ | (830) | |||||||||||||||||||||||
December 31, 2020 | |||||||||||||||||||||||||||||||||||
Available-for-sale - taxable | |||||||||||||||||||||||||||||||||||
Small Business Administration loan pools | $ | 18,849 | $ | (133) | $ | 8,945 | $ | (66) | $ | 27,794 | $ | (199) | |||||||||||||||||||||||
Mortgage-backed securities | 5,839 | — | 2,510 | (30) | 8,349 | (30) | |||||||||||||||||||||||||||||
United States agency obligations | 227 | — | — | — | 227 | — | |||||||||||||||||||||||||||||
Total available-for-sale - taxable | $ | 24,915 | $ | (133) | $ | 11,455 | $ | (96) | $ | 36,370 | $ | (229) | |||||||||||||||||||||||
| | | | | | |
|
| June 30, 2021 |
| December 31, 2020 | ||
Commercial real estate | | $ | 875,453 | | $ | 777,776 |
Residential real estate | |
| 361,946 | |
| 380,491 |
Commercial | |
| 373,333 | |
| 396,642 |
Construction and land development | |
| 74,175 | |
| 99,883 |
Consumer and other | |
| 14,575 | |
| 11,688 |
Total loans | |
| 1,699,482 | |
| 1,666,480 |
Unearned loan origination (fees) costs, net | |
| (1,984) | |
| (1,323) |
Unearned PPP loan origination (fees) costs, net | | | (4,855) | | | (4,255) |
Allowance for loan loss | |
| (10,418) | |
| (16,259) |
Loans held for sale | | | (2,039) | | | (1,270) |
Other | | | (18) | | | — |
Loans, net | | $ | 1,680,168 | | $ | 1,643,373 |
September 30, 2021 | December 31, 2020 | ||||||||||
Loans held for investment: | |||||||||||
Commercial real estate | $ | 856,194 | $ | 777,025 | |||||||
Residential real estate | 371,469 | 379,534 | |||||||||
Commercial (Non-PPP) | 288,177 | 206,095 | |||||||||
Commercial (PPP) | 85,133 | 185,748 | |||||||||
Construction and land development | 69,534 | 99,590 | |||||||||
Consumer and other | 16,744 | 9,689 | |||||||||
Total loans held for investment, gross | 1,687,251 | 1,657,681 | |||||||||
Allowance for loan loss | (11,478) | (16,259) | |||||||||
Loans held for investment, net | $ | 1,675,773 | $ | 1,641,422 | |||||||
Loans held for sale: | |||||||||||
Loans held for sale | $ | 284 | $ | 1,270 | |||||||
Total loans held for sale | $ | 284 | $ | 1,270 |
At June
| | | | | | | | | | | | | | | | | | | | | |
| | 30 – 59 | | 60 – 89 | | Greater than | | | | | | | | | | | | | |||
| | Days | | Days | | 89 Days | | | | | Total | | Loans Not | | | | |||||
|
| Past Due |
| Past Due |
| Past Due |
| Nonaccrual |
| Past Due |
| Past Due |
| Total | |||||||
June 30, 2021 |
| |
|
| |
|
| |
| | |
| | |
|
| |
|
| |
|
Commercial real estate | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | 875,453 | | $ | 875,453 |
Residential real estate | |
| — | |
| — | |
| — | |
| — | |
| — | |
| 361,946 | |
| 361,946 |
Commercial | |
| — | |
| — | |
| — | |
| 1,468 | |
| 1,468 | |
| 371,865 | |
| 373,333 |
Construction and land development | |
| — | |
| — | |
| — | |
| — | |
| — | |
| 74,175 | |
| 74,175 |
Consumer and other | |
| — | |
| 94 | |
| — | | | 1,307 | | | 1,401 | |
| 13,174 | |
| 14,575 |
Total | | $ | — | | $ | 94 | | $ | — | | $ | 2,775 | | $ | 2,869 | | $ | 1,696,613 | | $ | 1,699,482 |
| | | | | | | | | | | | | | | | | | | | | |
| | 30 – 59 | | 60 – 89 | | Greater than | | | | | | | | | | | | | |||
| | Days | | Days | | 89 Days | | | | | Total | | Loans Not | | | | |||||
|
| Past Due |
| Past Due |
| Past Due |
| Nonaccrual |
| Past Due |
| Past Due |
| Total | |||||||
December 31, 2020 | | | | | | | | | | | | | | | | | | | | | |
Commercial real estate | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | 777,776 | | $ | 777,776 |
Residential real estate | |
| 1,303 | |
| — | |
| — | |
| — | |
| 1,303 | |
| 379,188 | |
| 380,491 |
Commercial | |
| 278 | |
| — | |
| — | |
| 9,127 | |
| 9,405 | |
| 387,237 | |
| 396,642 |
Construction and land development | |
| — | |
| — | |
| — | |
| — | |
| — | |
| 99,883 | |
| 99,883 |
Consumer and other | |
| — | |
| — | |
| — | | | 1,307 | | | 1,307 | |
| 10,381 | |
| 11,688 |
Total | | $ | 1,581 | | $ | — | | $ | — | | $ | 10,434 | | $ | 12,015 | | $ | 1,654,465 | | $ | 1,666,480 |
12
30 – 59 Days Past Due | 60 – 89 Days Past Due | Greater than 89 Days Past Due | Nonaccrual | Total Past Due | Loans Not Past Due | Total | |||||||||||||||||||||||||||||||||||
September 30, 2021 | |||||||||||||||||||||||||||||||||||||||||
Commercial real estate | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 856,194 | $ | 856,194 | |||||||||||||||||||||||||||
Residential real estate | 22 | — | — | — | 22 | 371,447 | 371,469 | ||||||||||||||||||||||||||||||||||
Commercial (Non-PPP) | 369 | — | — | 1,468 | 1,837 | 286,340 | 288,177 | ||||||||||||||||||||||||||||||||||
Commercial (PPP) | — | — | — | — | — | 85,133 | 85,133 | ||||||||||||||||||||||||||||||||||
Construction and land development | — | — | — | — | — | 69,534 | 69,534 | ||||||||||||||||||||||||||||||||||
Consumer and other | 88 | — | — | 1,307 | 1,395 | 15,349 | 16,744 | ||||||||||||||||||||||||||||||||||
Total | $ | 479 | $ | — | $ | — | $ | 2,775 | $ | 3,254 | $ | 1,683,997 | $ | 1,687,251 |
At June30 – 59
Days
Past Due60 – 89
Days
Past DueGreater than
89 Days
Past DueNonaccrual Total
Past DueLoans Not
Past DueTotal December 31, 2020 Commercial real estate $ — $ — $ — $ — $ — $ 777,025 $ 777,025 Residential real estate 1,317 — — — 1,317 378,217 379,534 Commercial (Non-PPP) 278 — — 9,127 278 205,817 206,095 Commercial (PPP) — — — — — 185,748 185,748 Construction and land development — — — — — 99,590 99,590 Consumer and other — — — 1,307 — 9,689 9,689 Total $ 1,595 $ — $ — $ 10,434 $ 1,595 $ 1,656,086 $ 1,657,681
13
track record of timely loan payments, no material adverse changes to underlying collateral, and no material adverse change to guarantor(s) financial capacity, evidenced by public record searches.
| | | | | | | | | | | | | | | |
| | | | | Special | | | | | | | | | | |
(Dollars in thousands) |
| Pass |
| Mention |
| Substandard |
| Doubtful |
| Total | |||||
June 30, 2021 | | | |
| | |
| | |
| | |
| | |
Commercial real estate | | $ | 873,127 | | $ | — | | $ | 2,326 | | $ | — | | $ | 875,453 |
Residential real estate | |
| 361,946 |
|
| — |
|
| — |
|
| — |
|
| 361,946 |
Commercial | |
| 371,400 |
|
| 465 |
|
| 1,468 |
|
| — |
|
| 373,333 |
Construction and land development | |
| 74,175 |
|
| — |
|
| — |
|
| — |
|
| 74,175 |
Consumer | |
| 13,174 |
|
| 94 |
|
| 1,307 |
|
| — |
|
| 14,575 |
Total | | $ | 1,693,822 |
| $ | 559 |
| $ | 5,101 |
| $ | — |
| $ | 1,699,482 |
| | | |
| | |
| | |
| | |
| | |
December 31, 2020 | | | | | | | | | | | | | | | |
Commercial real estate | | $ | 775,420 | | $ | — | | $ | 2,356 | | $ | — | | $ | 777,776 |
Residential real estate | |
| 380,062 |
|
| 429 |
|
| — |
|
| — |
|
| 380,491 |
Commercial | |
| 387,403 |
|
| 112 |
|
| 9,127 |
|
| — |
|
| 396,642 |
Construction and land development | |
| 99,883 |
|
| — |
|
| — |
|
| — |
|
| 99,883 |
Consumer | |
| 10,381 |
|
| — |
|
| 1,307 |
|
| — |
|
| 11,688 |
Total | | $ | 1,653,149 |
| $ | 541 |
| $ | 12,790 |
| $ | — |
| $ | 1,666,480 |
(Dollars in thousands) | Pass | Special Mention | Substandard | Doubtful | Total | |||||||||||||||||||||||||||
September 30, 2021 | ||||||||||||||||||||||||||||||||
Commercial real estate | $ | 853,888 | $ | — | $ | 2,306 | $ | — | $ | 856,194 | ||||||||||||||||||||||
Residential real estate | 371,469 | — | — | — | 371,469 | |||||||||||||||||||||||||||
Commercial (Non-PPP) | 286,334 | 375 | 1,468 | — | 288,177 | |||||||||||||||||||||||||||
Commercial (PPP) | 85,133 | — | — | — | 85,133 | |||||||||||||||||||||||||||
Construction and land development | 69,534 | — | — | — | 69,534 | |||||||||||||||||||||||||||
Consumer | 15,349 | 88 | 1,307 | — | 16,744 | |||||||||||||||||||||||||||
Total | $ | 1,681,707 | $ | 463 | $ | 5,081 | $ | — | $ | 1,687,251 | ||||||||||||||||||||||
December 31, 2020 | ||||||||||||||||||||||||||||||||
Commercial real estate | $ | 774,674 | $ | — | $ | 2,351 | $ | — | $ | 777,025 | ||||||||||||||||||||||
Residential real estate | 379,104 | 430 | — | — | 379,534 | |||||||||||||||||||||||||||
Commercial (Non-PPP) | 196,856 | 112 | 9,127 | — | 206,095 | |||||||||||||||||||||||||||
Commercial (PPP) | 185,748 | — | — | — | 185,748 | |||||||||||||||||||||||||||
Construction and land development | 99,590 | — | — | — | 99,590 | |||||||||||||||||||||||||||
Consumer | 8,382 | — | 1,307 | — | 9,689 | |||||||||||||||||||||||||||
Total | $ | 1,644,354 | $ | 542 | $ | 12,785 | $ | — | $ | 1,657,681 |
| | | | | | |
(Dollars in thousands) | | June 30, 2021 |
| December 31, 2020 | ||
Commercial real estate(1) | | $ | 5,892 | | $ | — |
Residential real estate | | | 452 | | | 405 |
Commercial | |
| 616 | |
| 746 |
Construction and development(1) | |
| — | |
| 3,732 |
Carrying amount, net of total discounts | | $ | 6,960 | | $ | 4,883 |
(Dollars in thousands) | September 30, 2021 | December 31, 2020 | ||||||||||||
Commercial real estate(1) | $ | 5,869 | $ | — | ||||||||||
Residential real estate | 451 | 405 | ||||||||||||
Commercial | 556 | 746 | ||||||||||||
Construction and development(1) | — | 3,732 | ||||||||||||
Carrying amount, net of total discounts | $ | 6,876 | $ | 4,883 |
14
Changes in the carrying amount of the accretable yield for all purchased credit impaired loans were as follows for the sixnine months ended JuneSeptember 30, 2021:
|
|
|
| ||||||
(Dollars in thousands) | 2021 | ||||||||
Balance at beginning of period |
| $ | (630) | ||||||
Adjustment of income |
| — | |||||||
Accretion |
| 296 |
| ||||||
Reclassifications from nonaccretable difference |
| (136) | |||||||
Disposals |
| 16 |
| ||||||
Balance at end of period |
| $ |
|
| | | |
(Dollars in thousands) |
| March 26, 2020 | |
Contractually required principal and interest by loan type | | | |
Commercial real estate | | $ | 427 |
Residential real estate | |
| 604 |
Commercial | |
| 2,176 |
Construction and development | |
| 5,614 |
Consumer and other loans | |
| - |
Total | | $ | 8,821 |
Contractual cash flows not expected to be collected (nonaccretable discount) | | | |
Commercial real estate | | $ | 80 |
Residential real estate | |
| 138 |
Commercial | |
| 1,123 |
Construction and development | |
| 2,297 |
Consumer and other loans | |
| - |
Total | | $ | 3,638 |
| | | |
Expected cash flows | | $ | 5,183 |
Interest component of expected cash flows (accretable discount) | | | (545) |
Fair value of PCI loans accounted for under ASC 310-30 | | $ | 4,638 |
(Dollars in thousands) | March 26, 2020 | |||||||
Contractually required principal and interest by loan type | ||||||||
Commercial real estate | $ | 427 | ||||||
Residential real estate | 604 | |||||||
Commercial | 2,176 | |||||||
Construction and development | 5,614 | |||||||
Consumer and other loans | — | |||||||
Total | $ | 8,821 | ||||||
Contractual cash flows not expected to be collected (nonaccretable discount) | ||||||||
Commercial real estate | $ | 80 | ||||||
Residential real estate | 138 | |||||||
Commercial | 1,123 | |||||||
Construction and development | 2,297 | |||||||
Consumer and other loans | — | |||||||
Total | $ | 3,638 | ||||||
Expected cash flows | $ | 5,183 | ||||||
Interest component of expected cash flows (accretable discount) | (545) | |||||||
Fair value of PCI loans accounted for under ASC 310-30 | $ | 4,638 |
During the three months ended June 30, 2021, the Company funded 172 loans representing $17.6 million under Round 3 of the Paycheck Protection Program (“PPP.”).
15
Liquidity Facility ("PPPLF"). The PPPLF pledged loans are non-recourse to the Company. However, the Company paid off all of the PPPLF advances during the first and second quarter of 2021 and the balance was $0 as of June 30, 2021.
| | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | Construction | | | | | | ||
| | Commercial | | Residential | | | | | and land | | Consumer | | | | ||||
|
| Real Estate |
| Real Estate |
| Commercial |
| Development |
| and Other |
| Total | ||||||
June 30, 2021 |
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Allowance for loan losses: |
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Beginning balance | | $ | 3,159 | | $ | 2,177 | | $ | 10,462 | | $ | 388 | | $ | 73 | | $ | 16,259 |
Provision for loan losses | |
| 1,126 | |
| 92 | |
| 602 | |
| (27) | |
| 7 | |
| 1,800 |
Loans charged-off | |
| - | |
| - | |
| (7,641) | |
| - | |
| - | |
| (7,641) |
Recoveries | |
| - | |
| - | |
| - | |
| - | |
| - | |
| - |
Total ending allowance balance | | $ | 4,285 | | $ | 2,269 | | $ | 3,423 | | $ | 361 | | $ | 80 | | $ | 10,418 |
| | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | Construction | | | | | | | |
| | Commercial | | Residential | | | | | and land | | Consumer | | | | ||||
|
| Real Estate |
| Real Estate |
| Commercial |
| Development |
| and Other |
| Total | ||||||
December 31, 2020 |
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Allowance for loan losses: |
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Beginning balance | | $ | 1,845 | | $ | 3,115 | | $ | 1,235 | | $ | 272 | | $ | 81 | | $ | 6,548 |
Provision for loan losses | |
| 1,314 | |
| (731) | |
| 9,326 | |
| 116 | |
| (8) | |
| 10,017 |
Loans charged-off | |
| — | |
| (207) | |
| (99) | |
| — | |
| — | |
| (306) |
Recoveries | |
| — | |
| — | |
| — | |
| — | |
| — | |
| — |
Total ending allowance balance | | $ | 3,159 | | $ | 2,177 | | $ | 10,462 | | $ | 388 | | $ | 73 | | $ | 16,259 |
16
Commercial Real Estate | Residential Real Estate | Commercial | Construction and Land Development | Consumer and Other | Total | ||||||||||||||||||||||||||||||
September 30, 2021 | |||||||||||||||||||||||||||||||||||
Allowance for loan losses: | |||||||||||||||||||||||||||||||||||
Beginning balance | $ | 3,159 | $ | 2,177 | $ | 10,462 | $ | 388 | $ | 73 | $ | 16,259 | |||||||||||||||||||||||
Provision for loan losses | 920 | 45 | 1,276 | (55) | 674 | 2,860 | |||||||||||||||||||||||||||||
Loans charged-off | — | — | (7,641) | — | — | (7,641) | |||||||||||||||||||||||||||||
Recoveries | — | — | — | — | — | — | |||||||||||||||||||||||||||||
Total ending allowance balance | $ | 4,079 | $ | 2,222 | $ | 4,097 | $ | 333 | $ | 747 | $ | 11,478 |
Commercial Real Estate | Residential Real Estate | Commercial | Construction and Land Development | Consumer and Other | Total | ||||||||||||||||||||||||||||||
December 31, 2020 | |||||||||||||||||||||||||||||||||||
Allowance for loan losses: | |||||||||||||||||||||||||||||||||||
Beginning balance | $ | 1,845 | $ | 3,115 | $ | 1,235 | $ | 272 | $ | 81 | $ | 6,548 | |||||||||||||||||||||||
Provision for loan losses | 1,314 | (731) | 9,326 | 116 | (8) | 10,017 | |||||||||||||||||||||||||||||
Loans charged-off | — | (207) | (99) | — | — | (306) | |||||||||||||||||||||||||||||
Recoveries | — | — | — | — | — | — | |||||||||||||||||||||||||||||
Total ending allowance balance | $ | 3,159 | $ | 2,177 | $ | 10,462 | $ | 388 | $ | 73 | $ | 16,259 |
| | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | Construction | | | | | | ||
| | Commercial | | Residential | | | | | and Land | | Consumer | | | | ||||
|
| Real Estate |
| Real Estate |
| Commercial |
| Development |
| and Other |
| Total | ||||||
June 30, 2021 | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Allowance for loan losses: | | | | | | | | | | | | | | | | | | |
Ending allowance balance attributable to loans | | | | | | | | | | | | | | | | | | |
Individually evaluated for impairment | | $ | — | | $ | — | | $ | 658 | | $ | — | | $ | — | | $ | 658 |
Purchased Credit Impaired (PCI) loans | | | — | | | — | | | — | | | — | | | — | | | — |
Collectively evaluated for impairment | | | 4,285 | | | 2,269 | | | 2,765 | | | 361 | | | 80 | | | 9,760 |
Total ending allowance balance | | $ | 4,285 | | $ | 2,269 | | $ | 3,423 | | $ | 361 | | $ | 80 | | $ | 10,418 |
| | | | | | | | | | | | | | | | | | |
Loans: | | | | | | | | | | | | | | | | | | |
Loans individually evaluated for impairment | | $ | 2,326 | | $ | 252 | | $ | 1,468 | | $ | — | | $ | 1,307 | | $ | 5,353 |
Loans collectively evaluated for impairment | | | 873,127 | | | 361,694 | | | 371,865 | | | 74,175 | | | 13,268 | | | 1,694,129 |
Total ending loans balance | | $ | 875,453 | | $ | 361,946 | | $ | 373,333 | | $ | 74,175 | | $ | 14,575 | | $ | 1,699,482 |
| | | | | | | | | | | | | | | | | | |
December 31, 2020 | | | | | | | | | | | | | | | | | | |
Allowance for loan losses: | | | | | | | | | | | | | | | | | | |
Ending allowance balance attributable to loans | | | | | | | | | | | | | | | | | | |
Individually evaluated for impairment | | $ | — | | $ | — | | $ | 8,309 | | $ | — | | $ | — | | $ | 8,309 |
Purchased Credit Impaired (PCI) loans | | | — | | | — | | | — | | | — | | | — | | | |
Collectively evaluated for impairment | | | 3,159 | | | 2,177 | | | 2,153 | | | 388 | | | 73 | | | 7,950 |
Total ending allowance balance | | $ | 3,159 | | $ | 2,177 | | $ | 10,462 | | $ | 388 | | $ | 73 | | $ | 16,259 |
| | | | | | | | | | | | | | | | | | |
Loans: | | | | | | | | | | | | | | | | | | |
Loans individually evaluated for impairment | | $ | 2,356 | | $ | 298 | | $ | 9,127 | | $ | — | | $ | 1,307 | | $ | 13,088 |
Loans collectively evaluated for impairment | | | 775,420 | | | 380,193 | | | 387,515 | | | 99,883 | | | 10,381 | | | 1,653,392 |
Total ending loans balance | | $ | 777,776 | | $ | 380,491 | | $ | 396,642 | | $ | 99,883 | | $ | 11,688 | | $ | 1,666,480 |
Commercial
Real Estate Residential
Real Estate Commercial Construction
and Land
Development Consumer
and Other Total September 30, 2021 Allowance for loan losses: Ending allowance balance attributable to loans Individually evaluated for impairment $ — $ — $ 669 $ — $ 653 $ 1,322 Purchased Credit Impaired (PCI) loans — — — — — — Collectively evaluated for impairment 4,079 2,222 3,428 333 94 10,156 Total ending allowance balance $ 4,079 $ 2,222 $ 4,097 $ 333 $ 747 $ 11,478 Loans: Loans individually evaluated for impairment $ 2,306 $ 227 $ 1,468 $ — $ 1,307 $ 5,308 Loans collectively evaluated for impairment 853,888 371,242 371,842 69,534 15,437 1,681,943 Total ending loans balance $ 856,194 $ 371,469 $ 373,310 $ 69,534 $ 16,744 $ 1,687,251 December 31, 2020 Allowance for loan losses: Ending allowance balance attributable to loans Individually evaluated for impairment $ — $ — $ 8,309 $ — $ — $ 8,309 Purchased Credit Impaired (PCI) loans — — — — — 0 Collectively evaluated for impairment 3,159 2,177 2,153 388 73 7,950 Total ending allowance balance $ 3,159 $ 2,177 $ 10,462 $ 388 $ 73 $ 16,259 Loans: Loans individually evaluated for impairment $ 2,351 $ 299 $ 9,127 $ — $ 1,307 $ 13,084 Loans collectively evaluated for impairment 774,674 379,235 382,716 99,590 8,382 1,644,597 Total ending loans balance $ 777,025 $ 379,534 $ 391,843 $ 99,590 $ 9,689 $ 1,657,681
For the Nine Months Ended September 30, 2021 | For the Year Ended December 31, 2020 | |||||||||||||||||||||||||
(Dollars in thousands) | Ending Balance | % of Total | Ending Balance | % of Total | ||||||||||||||||||||||
NOW accounts | $ | 328,667 | 14.0% | $ | 232,367 | 14.0% | ||||||||||||||||||||
Money market accounts | 893,441 | 37.9% | 679,761 | 41.0% | ||||||||||||||||||||||
Brokered deposits | 56,418 | 2.4% | 30,137 | 1.8% | ||||||||||||||||||||||
Savings accounts | 13,833 | 0.6% | 9,727 | 0.6% | ||||||||||||||||||||||
Certificates of deposit | 262,998 | 11.2% | 231,953 | 14.0% | ||||||||||||||||||||||
Total interest-bearing deposits | 1,555,357 | 66.1% | 1,183,945 | 71.3% | ||||||||||||||||||||||
Noninterest-bearing deposits | 799,389 | 33.9% | 475,598 | 28.7% | ||||||||||||||||||||||
Total deposits | $ | 2,354,746 | 100.0% | $ | 1,659,543 | 100.0% |
| | | | | | | | | | | |
| | For the Six Months Ended | | For the Year Ended | | ||||||
| | June 30, 2021 | | December 31, 2020 | | ||||||
| | Ending | | | | Ending | | | | ||
(Dollars in thousands) |
| Balance |
| % of Total |
| Balance |
| % of Total |
| ||
NOW accounts | | $ | 286,173 | | 12.6 | % | $ | 232,367 | | 14.0 | % |
Money market accounts | |
| 810,913 |
| 35.6 | % |
| 679,761 |
| 41.0 | % |
Brokered deposits | | | 56,534 | | 2.5 | % | | 30,137 | | 1.8 | % |
Savings accounts | |
| 11,814 |
| 0.5 | % |
| 9,727 |
| 0.6 | % |
Certificates of deposit | |
| 257,056 |
| 11.3 | % |
| 231,953 |
| 14.0 | % |
Total interest-bearing deposits | |
| 1,422,490 |
| 62.5 | % |
| 1,183,945 |
| 71.3 | % |
Noninterest-bearing deposits | |
| 854,673 |
| 37.5 | % |
| 475,598 |
| 28.7 | % |
Total deposits | | $ | 2,277,163 | | 100.0 | % | $ | 1,659,543 | | 100.0 | % |
| | | | | | | | | | | | | | | |
|
| | |
| Over |
| Over Six |
| | |
| | | ||
| | Three | | Three | | Months | | | | | | | |||
| | Months or | | Through | | Through | | Over | | | | ||||
(Dollars in thousands) | | Less | | Six Months | | 12 Months | | 12 Months | | Total | |||||
Time deposits of $250,000 or less | | $ | 15,852 | | $ | 12,749 | | $ | 43,020 | | $ | 22,047 | | $ | 93,668 |
Time deposits of more than $250,000 | | | 23,302 | | | 24,537 | | | 85,376 | | | 34,797 | | | 168,012 |
Total | | $ | 39,154 | | $ | 37,286 | | $ | 128,396 | | $ | 56,844 | | $ | 261,680 |
17
(Dollars in thousands) | Three Months or Less | Over Three Through Six Months | Over Six Months Through 12 Months | Over 12 Months | Total | |||||||||||||||||||||||||||
Time deposits of $250,000 or less | $ | 13,123 | $ | 18,043 | $ | 57,678 | $ | 6,444 | $ | 95,288 | ||||||||||||||||||||||
Time deposits of more than $250,000 | 25,539 | 30,762 | 111,204 | 4,831 | 172,336 | |||||||||||||||||||||||||||
Total | $ | 38,662 | $ | 48,805 | $ | 168,882 | $ | 11,275 | $ | 267,624 |
The following tables present the maturities of our time deposits including time deposits that meet or exceed the $250,000 FDIC insurance limit as of December 31, 2020.
| | | | | | | | | | | | | | | |
|
| | |
| Over |
| Over Six |
| | |
| | | ||
| | Three | | Three | | Months | | | | | | | |||
| | Months or | | Through | | Through | | Over | | | | ||||
(Dollars in thousands) | | Less | | Six Months | | 12 Months | | 12 Months | | Total | |||||
Time deposits of $250,000 or less | | $ | 20,767 | | $ | 13,258 | | $ | 24,805 | | $ | 19,240 | | $ | 78,070 |
Time deposits of more than $250,000 | | | 40,189 | | | 35,314 | | | 42,844 | | | 40,158 | | | 158,505 |
Total | | $ | 60,956 | | $ | 48,572 | | $ | 67,649 | | $ | 59,398 | | $ | 236,575 |
2020.
(Dollars in thousands) | Three Months or Less | Over Three Through Six Months | Over Six Months Through 12 Months | Over 12 Months | Total | |||||||||||||||||||||||||||
Time deposits of $250,000 or less | $ | 20,767 | $ | 13,258 | $ | 24,805 | $ | 19,240 | $ | 78,070 | ||||||||||||||||||||||
Time deposits of more than $250,000 | 40,189 | 35,314 | 42,845 | 40,157 | 158,505 | |||||||||||||||||||||||||||
Total | $ | 60,956 | $ | 48,572 | $ | 67,650 | $ | 59,397 | $ | 236,575 |
| | | | | | |
| | June 30, 2021 | | December 31, 2020 | ||
Less than 1 year | | $ | 204,836 | | $ | 177,178 |
Over 1 through 2 years | | | 55,625 | | | 57,034 |
Over 2 through 3 years | | | 1,179 | | | 1,658 |
Over 3 through 4 years | | | 40 | | | 705 |
Over 4 through 5 years | | | - | | | - |
Over 5 years | | | - | | | - |
Total | | $ | 261,680 | | $ | 236,575 |
September 30, 2021 | December 31, 2020 | ||||||||||
Less than 1 year | $ | 256,349 | $ | 177,178 | |||||||
Over 1 through 2 years | 10,153 | 57,034 | |||||||||
Over 2 through 3 years | 1,082 | 1,658 | |||||||||
Over 3 through 4 years | 40 | 705 | |||||||||
Over 4 through 5 years | — | — | |||||||||
Over 5 years | — | — | |||||||||
Total | $ | 267,624 | $ | 236,575 |
Subordinated Debt. On March 26, 2020, pursuant to terms of the acquisition, the Company assumed the subordinated notes payable of Marquis Bancorp, Inc. (“MBI”) at its fair value of $10.3 million. According to the terms of the subordinated note, the principal amount due is $10.0 million with a 7% fixed rate until October 30, 2021, and a variable rate thereafter at LIBOR plus 576 basis points. The note matures on October 30, 2026, and can be redeemed by the Company anytime on or after
18
| | | | | | | |
| | Six Months Ended | | Year Ended | | ||
(Dollars in thousands) |
| June 30, 2021 |
| December 31, 2020 | | ||
Amount outstanding at period-end | | $ | 35,000 | | $ | 40,000 | |
Weighted average interest rate at period-end | |
| 2.04 | % |
| 1.96 | % |
Maximum month-end balance during period | | $ | 40,000 | | $ | 70,000 | |
Average balance outstanding during period | |
| 38,867 | |
| 58,210 | |
Weighted average interest rate during period | |
| 1.98 | % |
| 1.63 | % |
(Dollars in thousands) | Nine Months Ended September 30, 2021 | Year Ended December 31, 2020 | ||||||||||||
Amount outstanding at period-end | $ | 35,000 | $ | 40,000 | ||||||||||
Weighted average interest rate at period-end | 2.04% | 1.96% | ||||||||||||
Maximum month-end balance during period | $ | 40,000 | $ | 70,000 | ||||||||||
Average balance outstanding during period | 37,564 | 58,210 | ||||||||||||
Weighted average interest rate during period | 2.00% | 1.63% |
Federal Reserve Bank of Atlanta. The Federal Reserve Bank of Atlanta has an available borrower in custody arrangement which allows us to borrow on a collateralized basis. NaNNo advances were outstanding under this facility as of JuneSeptember 30, 20212021..
were $0.
19
Class B Non-voting Common Stock
20
Accrued interest receivable: The carrying amounts of accrued interest approximate their fair values.
Basis:
| | | | | | | | | | | | |
| | | | | Fair Value Measurements | |||||||
| | | | | at June 30, 2021 Using: | |||||||
| | | | | | | | Significant | | | | |
| | | | | Quoted Prices in | | Other | | Significant | |||
| | | | | Active Markets for | | Observable | | Unobservable | |||
| | Fair | | Identical Assets | | Inputs | | Inputs | ||||
June 30, 2021 |
| Value |
| (Level 1) |
| (Level 2) |
| (Level 3) | ||||
Available-for-sale - taxable |
| |
|
| |
|
| |
|
| |
|
Small Business Administration loan pools | | $ | 42,596 | | $ | — | | $ | 42,596 | | $ | — |
Mortgage-backed securities | |
| 54,540 | |
| — | |
| 54,540 | |
| — |
United States agency obligations | | | 2,089 | | | — | | | 2,089 | | | — |
Corporate bonds | |
| 1,510 | |
| — | |
| 1,510 | |
| — |
Total | | $ | 100,735 | | $ | — | | $ | 100,735 | | $ | — |
Available-for-sale - tax exempt | | | | | | | | | | | | |
Community Development District bonds | | $ | 18,658 | | $ | — | | $ | 18,658 | | $ | — |
Municipals | | | 1,103 | | | — | | | 1,103 | | | — |
Total | | $ | 19,761 | | $ | — | | $ | 19,761 | | $ | — |
Equity |
| |
|
| |
|
| |
|
| |
|
Mutual funds | | $ | 5,942 | | $ | 5,942 | | $ | — | | $ | — |
Total | | $ | 5,942 | | $ | 5,942 | | $ | — | | $ | — |
21
Fair Value Measurements on September 30, 2021 Using: | ||||||||||||||||||||||||||
September 30, 2021 | Fair Value | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||||||||||||
Available-for-sale - taxable | ||||||||||||||||||||||||||
Small Business Administration loan pools | $ | 39,703 | $ | — | $ | 39,703 | $ | — | ||||||||||||||||||
Mortgage-backed securities | 50,928 | — | 50,928 | — | ||||||||||||||||||||||
United States agency obligations | 2,078 | — | 2,078 | — | ||||||||||||||||||||||
Corporate bonds | 1,509 | — | 1,509 | — | ||||||||||||||||||||||
Total | $ | 94,218 | $ | — | $ | 94,218 | $ | — | ||||||||||||||||||
Available-for-sale - tax exempt | ||||||||||||||||||||||||||
Community Development District bonds | $ | 18,364 | $ | — | $ | 18,364 | $ | — | ||||||||||||||||||
Municipals | 1,098 | — | 1,098 | — | ||||||||||||||||||||||
Total | $ | 19,462 | $ | — | $ | 19,462 | $ | — | ||||||||||||||||||
Equity | ||||||||||||||||||||||||||
Mutual funds | $ | 5,903 | $ | 5,903 | $ | — | $ | — | ||||||||||||||||||
Other equity securities | 800 | 800 | — | — | ||||||||||||||||||||||
Total | $ | 6,703 | $ | 6,703 | $ | — | $ | — | ||||||||||||||||||
| | | | | | | | | | | | |
| | | | | Fair Value Measurements | |||||||
| | | | | at December 31, 2020 Using: | |||||||
| | | | | | | | Significant | | | | |
| | | | | Quoted Prices in | | Other | | Significant | |||
| | | | | Active Markets for | | Observable | | Unobservable | |||
| | Fair | | Identical Assets | | Inputs | | Inputs | ||||
December 31, 2020 |
| Value |
| (Level 1) |
| (Level 2) |
| (Level 3) | ||||
Available-for-sale - taxable |
| |
|
| |
|
| |
|
| |
|
Small Business Administration loan pools | | $ | 30,556 | | $ | — | | $ | 30,556 | | $ | — |
Mortgage-backed securities | |
| 28,922 | |
| — | |
| 28,922 | |
| — |
United States agency obligations | |
| 3,122 | |
| — | |
| 3,122 | |
| — |
Corporate bonds | |
| 2,510 | |
| — | |
| 2,510 | |
| — |
Total | | $ | 65,110 | | $ | — | | $ | 65,110 | | $ | — |
Available-for-sale - tax exempt | | | | | | | | | | | | |
Community Development District bonds | | $ | 21,299 | | $ | — | | $ | 21,299 | | $ | — |
Municipals | | | 1,099 | | | — | | | 1,099 | | | — |
Total | | $ | 22,398 | | $ | — | | $ | 22,398 | | $ | — |
Equity |
| |
|
| |
|
| |
|
| |
|
Mutual funds | | $ | 6,005 | | $ | 6,005 | | $ | — | | $ | — |
Total | | $ | 6,005 | | $ | 6,005 | | $ | — | | $ | — |
| | | | | | | | | | | | |
| | | | | at June 30, 2021 Using: | |||||||
| | | | | | | | Significant | | | | |
| | | | | Quoted Prices in | | Other | | Significant | |||
| | | | | Active Markets for | | Observable | | Unobservable | |||
| | Fair | | Identical Assets | | Inputs | | Inputs | ||||
June 30, 2021 |
| Value |
| (Level 1) |
| (Level 2) |
| (Level 3) | ||||
Customer Derivatives: Interest Rate SWAPs |
| |
|
| |
|
| |
|
| |
|
Customer Derivatives - Interest Rate SWAPs Asset | | $ | 863 | | $ | — | | $ | 863 | | $ | — |
Customer Derivatives - Interest Rate SWAPs Liability | | | (863) | | | — | | | (863) | | | — |
Total | | $ | — | | $ | — | | $ | — | | $ | — |
December 31, 2020 Fair
ValueQuoted Prices in
Active Markets for
Identical Assets
(Level 1)Significant
Other
Observable
Inputs
(Level 2)Significant
Unobservable
Inputs
(Level 3)Available-for-sale - taxable Small Business Administration loan pools $ 30,556 $ — $ 30,556 $ — Mortgage-backed securities 28,922 — 28,922 — United States agency obligations 3,122 — 3,122 — Corporate bonds 2,510 — 2,510 — Total $ 65,110 $ — $ 65,110 $ — Available-for-sale - tax exempt Community Development District bonds $ 21,299 $ — $ 21,299 $ — Municipals 1,099 — 1,099 — Total $ 22,398 $ — $ 22,398 $ — Equity Mutual funds $ 6,005 $ 6,005 $ — $ — Total $ 6,005 $ 6,005 $ — $ —
on September 30, 2021 Using: | ||||||||||||||||||||||||||
September 30, 2021 | Fair Value | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||||||||||||
Customer Derivatives - Interest Rate SWAPs | ||||||||||||||||||||||||||
Customer Derivatives - Interest Rate SWAPs Asset | $ | 1,300 | $ | — | $ | 1,300 | $ | — | ||||||||||||||||||
Customer Derivatives - Interest Rate SWAPs Liability | (1,300) | — | (1,300) | — | ||||||||||||||||||||||
Total | $ | — | $ | — | $ | — | $ | — |
22
value of collateral was noted as $0.6 million. The net result of these calculations provides for 0no specific reserve within the Allowance for Loan and Lease Losses (“ALLL”) associated with the Coex loan or approximately 0% of the carrying value of the loan.
| | | | | | | | | | | | | | | |
| | | | | Fair Value Measurements | ||||||||||
| | | | | at June 30, 2021 Using: | ||||||||||
| | | | | | | | Significant | | | | | | | |
| | | | | Quoted Prices in | | Other | | Significant | | | | |||
| | Total at | | Active Markets for | | Observable | | Unobservable | | | | ||||
| | June 30, | | Identical Assets | | Inputs | | Inputs | | Total Gains | |||||
(Dollars in thousands) |
| 2021 |
| (Level 1) |
| (Level 2) |
| (Level 3) |
| (Losses) | |||||
Impaired Loans: |
| |
|
| |
|
| |
|
| |
| | |
|
Commercial real estate | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — |
Residential real estate | |
| — | |
| — | |
| — | |
| — | |
| — |
Commercial | | | 810 | | | — | | | — | | | 810 | | | (658) |
Construction and land development | | | — | | | — | | | — | | | — | | | — |
Consumer and other | |
| — | |
| — | |
| — | |
| — | |
| — |
Total | | $ | 810 | | $ | — | | $ | — | | $ | 810 | | $ | (658) |
| | | | | | | | | | | | | | | |
| | | | | Fair Value Measurements | ||||||||||
| | | | | at December 31, 2020 Using: | ||||||||||
| | | | | | | | Significant | | | | | | | |
| | | | | Quoted Prices in | | Other | | Significant | | | | |||
| | Total at | | Active Markets for | | Observable | | Unobservable | | | | ||||
| | December 31, | | Identical Assets | | Inputs | | Inputs | | Total Gains | |||||
(Dollars in thousands) |
| 2020 |
| (Level 1) |
| (Level 2) |
| (Level 3) |
| (Losses) | |||||
Impaired Loans: |
| |
|
| |
|
| |
|
| |
| | |
|
Commercial real estate | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — |
Residential real estate | |
| — | |
| — | |
| — | |
| — | |
| — |
Commercial | | | 818 | | | — | | | — | | | 818 | | | (8,309) |
Construction and land development | | | — | | | — | | | — | | | — | | | — |
Consumer and other | |
| — | |
| — | |
| — | |
| — | |
| — |
Total | | $ | 818 | | $ | — | | $ | — | | $ | 818 | | $ | (8,309) |
23
Fair Value Measurements on September 30, 2021 Using: | |||||||||||||||||||||||||||||
(Dollars in thousands) | Total at September 30, 2021 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total Gains (Losses) | ||||||||||||||||||||||||
Impaired Loans: | |||||||||||||||||||||||||||||
Commercial real estate | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||
Residential real estate | — | — | — | — | — | ||||||||||||||||||||||||
Commercial | 799 | — | — | 799 | (669) | ||||||||||||||||||||||||
Construction and land development | — | — | — | — | — | ||||||||||||||||||||||||
Consumer and other | 654 | — | — | 654 | (654) | ||||||||||||||||||||||||
Total | $ | 1,453 | $ | — | $ | — | $ | 1,453 | $ | (1,323) |
Fair Value Measurements on December 31, 2020 Using: | |||||||||||||||||||||||||||||
(Dollars in thousands) | Total at December 31, 2020 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total Gains (Losses) | ||||||||||||||||||||||||
Impaired Loans: | |||||||||||||||||||||||||||||
Commercial real estate | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||
Residential real estate | — | — | — | — | — | ||||||||||||||||||||||||
Commercial | 818 | — | — | 818 | (8,309) | ||||||||||||||||||||||||
Construction and land development | — | — | — | — | — | ||||||||||||||||||||||||
Consumer and other | — | — | — | — | — | ||||||||||||||||||||||||
Total | $ | 818 | $ | — | $ | — | $ | 818 | $ | (8,309) |
As shown above our impaired loans consist solely of commercial loans considered to be Level 3. These Level 3 loans have significant unobservable inputs such as appraisal adjustments for local market conditions and economic factors that may result in changes in value of an assets over time.
September 30, 2021 | |||||||||||||||||
Carrying Amount | Fair Value | Fair Value Hierarchy | |||||||||||||||
Financial Assets: | |||||||||||||||||
Cash & Due from Banks, including interest bearing deposits | $ | 720,407 | $ | 720,407 | Level 1 | ||||||||||||
Federal Funds Sold | 23,736 | 23,736 | Level 1 | ||||||||||||||
Securities, Available for Sale - taxable | 94,739 | 94,218 | Level 2 | ||||||||||||||
Securities, Available for Sale - tax exempt | 18,854 | 19,462 | Level 2 | ||||||||||||||
Securities, Held to Maturity | 259 | 269 | Level 2 | ||||||||||||||
Securities, Equity | 5,903 | 5,903 | Level 1 | ||||||||||||||
Securities, Other Equity | 800 | 800 | Level 1 | ||||||||||||||
Loans, net | 1,675,773 | 1,691,673 | Level 3 | ||||||||||||||
Loans Held For Sale | 284 | 284 | Level 1 | ||||||||||||||
Bank Owned Life Insurance | 38,204 | 38,204 | Level 2 | ||||||||||||||
Accrued Interest Receivable | 5,336 | 5,336 | Level 1, 2 & 3 | ||||||||||||||
Customer Derivatives - Interest Rate SWAPs | 1,300 | 1,300 | Level 2 | ||||||||||||||
Financial Liabilities: | |||||||||||||||||
Deposits | 2,354,746 | 2,325,899 | Level 2 | ||||||||||||||
Federal Home Loan Bank Advances | 35,000 | 33,809 | Level 2 | ||||||||||||||
Subordinated Debt | 10,016 | 10,016 | Level 2 | ||||||||||||||
Customer Derivatives - Interest Rate SWAPs | 1,300 | 1,300 | Level 2 | ||||||||||||||
Accrued Interest Payable | 266 | 266 | Level 2 |
December 31, 2020 | |||||||||||||||||
Carrying Amount | Fair Value | Fair Value Hierarchy | |||||||||||||||
Financial Assets: | |||||||||||||||||
Cash & Due from Banks, including interest bearing deposits | $ | 191,597 | $ | 191,597 | Level 1 | ||||||||||||
Federal Funds Sold | 25,375 | 25,375 | Level 1 | ||||||||||||||
Securities, Available for Sale - taxable | 65,110 | 65,110 | Level 2 | ||||||||||||||
Securities, Available for Sale - tax exempt | 22,398 | 22,398 | Level 2 | ||||||||||||||
Securities, Held to Maturity | 1,547 | 1,561 | Level 2 | ||||||||||||||
Securities, Equity | 6,005 | 6,005 | Level 1 | ||||||||||||||
Loans, net | 1,641,422 | 1,653,401 | Level 3 | ||||||||||||||
Loans Held For Sale | 1,270 | 1,270 | Level 1 | ||||||||||||||
Bank Owned Life Insurance | 37,360 | 37,360 | Level 2 | ||||||||||||||
Accrued Interest Receivable | 6,666 | 6,666 | Level 1, 2 & 3 | ||||||||||||||
Financial Liabilities: | |||||||||||||||||
Deposits | 1,659,543 | 1,693,331 | Level 2 | ||||||||||||||
Federal Home Loan Bank Advances | 40,000 | 37,927 | Level 2 | ||||||||||||||
Subordinated Debt | 10,153 | 10,153 | Level 2 | ||||||||||||||
PPPLF Advances | 101,358 | 101,519 | Level 2 | ||||||||||||||
Loan Participations | 13,215 | 13,215 | Level 2 | ||||||||||||||
Accrued Interest Payable | 546 | 546 | Level 2 |
| | | | | | | | |
| | June 30, 2021 | ||||||
| | Carrying | | Fair | | Fair Value | ||
|
| Amount |
| Value |
| Hierarchy | ||
Financial Assets: |
| |
|
| |
|
|
|
Cash & Due from Banks, including interest bearing deposits | | $ | 616,180 | | $ | 616,180 |
| Level 1 |
Federal Funds Sold | |
| 36,156 | |
| 36,156 |
| Level 1 |
Securities, Available for Sale - taxable | |
| 101,109 | |
| 100,735 |
| Level 2 |
Securities, Available for Sale - tax exempt | | | 19,011 | | | 19,761 | | Level 2 |
Securities, Held to Maturity | |
| 1,285 | |
| 1,296 |
| Level 2 |
Securities, Equity | |
| 5,942 | |
| 5,942 |
| Level 1 |
Loans, net | |
| 1,680,168 | |
| 1,702,726 |
| Level 3 |
Loans Held For Sale | |
| 2,039 | |
| 2,039 |
| Level 1 |
Bank Owned Life Insurance | | | 37,923 | | | 37,923 | | Level 2 |
Accrued Interest Receivable | |
| 5,449 | |
| 5,449 |
| Level 1, 2 & 3 |
Customer Derivatives - Interest Rate SWAPs | | | 863 | | | 863 | | Level 2 |
| | | | | | | | |
Financial Liabilities: | |
|
| |
|
|
|
|
Deposits | |
| 2,277,163 | |
| 2,246,864 |
| Level 2 |
Federal Home Loan Bank Advances | |
| 35,000 | |
| 33,671 |
| Level 2 |
Subordinated Debt | | | 10,062 | | | 10,062 | | Level 2 |
PPPLF Advances | | | — | | | — | | Level 2 |
Loan Participations | | | — | | | — | | Level 2 |
Customer Derivatives - Interest Rate SWAPs | | | 863 | | | 863 | | Level 2 |
Accrued Interest Payable | |
| 267 | |
| 267 |
| Level 2 |
| | | | | | | | |
| | December 31, 2020 | ||||||
| | Carrying | | Fair | | Fair Value | ||
|
| Amount |
| Value |
| Hierarchy | ||
Financial Assets: |
| |
|
| |
|
|
|
Cash & Due from Banks, including interest bearing deposits | | $ | 191,597 | | $ | 191,597 |
| Level 1 |
Federal Funds Sold | |
| 25,375 | |
| 25,375 |
| Level 1 |
Securities, Available for Sale - taxable | |
| 65,110 | |
| 65,110 |
| Level 2 |
Securities, Available for Sale - tax exempt | | | 22,398 | | | 22,398 | | Level 2 |
Securities, Held to Maturity | |
| 1,547 | |
| 1,561 |
| Level 2 |
Securities, Equity | |
| 6,005 | |
| 6,005 |
| Level 1 |
Loans, net | |
| 1,643,373 | |
| 1,653,401 |
| Level 3 |
Loans Held For Sale | | | 1,270 | | | 1,270 | | Level 1 |
Bank Owned Life Insurance | |
| 37,360 | |
| 37,360 |
| Level 2 |
Accrued Interest Receivable | |
| 6,666 | |
| 6,666 |
| Level 1, 2 & 3 |
| | | | | | | | |
Financial Liabilities: | |
|
| |
|
|
|
|
Deposits | |
| 1,659,543 | |
| 1,693,331 |
| Level 2 |
Federal Home Loan Bank Advances | |
| 40,000 | |
| 37,927 |
| Level 2 |
Subordinated Debt | | | 10,153 | | | 10,153 | | Level 2 |
PPPLF Advances | | | 101,358 | | | 101,519 | | Level 2 |
Loan Participations | | | 13,215 | | | 13,215 | | Level 2 |
Accrued Interest Payable | |
| 546 | |
| 546 |
| Level 2 |
During the first quarter of 2021, the Company established a program whereby it originates a variable rate loan and enters into a variable-to-fixed interest rate SWAP with the customer. The Company also enters into an offsetting SWAP with a SWAP dealer. These back-to-back SWAP agreements are intended to offset each other and allow the Company to originate a variable rate loan, while providing a contract for fixed interest payments for the customer. The net cash flow for the Company is equal to the interest income received from a variable rate loan originated with the customer. The SWAPs with both the customers and thirdparties are notdesignated as hedges under FASB ASC Topic 815,Derivatives and Hedging, and are marked to market through earnings. As the SWAPs are structured to offset each other, changes to the underlying benchmark interest rates considered in the valuation of these instruments do not result in an impact to
24
earnings; however, there maybe fair value adjustments related to credit quality variations between counterparties, which mayimpact earnings as required by FASB ASC Topic 820,Fair Value Measurement and Disclosure (“ASC 820”). During the sixnine months ended JuneSeptember 30, 2021, the Company recorded 58 SWAP transactions with clients having a total notional amount of $22.3$69.7 million, offset by five8 SWAP transactions with dealers having a total notional amount of $22.3$69.7 million. Additionally, we recorded $0.5$0.5 million in back-to-back SWAP fees.fee income. The fair value of these derivatives is based on a market standard discounted cash flow approach. The Company incorporates credit value adjustments on derivatives to properly reflect the respective counterparty’s nonperformance risk in the fair value measurements of its derivatives. As of JuneSeptember 30, 2021, the Bank’s asset fair value position in other assets was $0.9$1.3 million and liability fair value position in other liabilities was $0.9$1.3 million, which were fully collateralized with pledged securities held with counterparty in excess of the exposure amount at quarter end.
| | | | | | |
(Dollars in thousands) |
| June 30, 2021 |
| December 31, 2020 | ||
Unfunded lines of credit | | $ | 366,015 | | $ | 356,955 |
Commitments to extend credit | |
| 83,857 | |
| 40,629 |
Letters of credit | |
| 11,226 | |
| 13,036 |
Total credit extension commitments | | $ | 461,098 | | $ | 410,620 |
(Dollars in thousands) | September 30, 2021 | December 31, 2020 | ||||||||||||
Unfunded lines of credit | $ | 368,117 | $ | 356,955 | ||||||||||
Commitments to extend credit | 97,251 | 40,629 | ||||||||||||
Letters of credit | 11,308 | 13,036 | ||||||||||||
Total credit extension commitments | $ | 476,676 | $ | 410,620 |
25
Actual and required capital amounts and ratios are presented below at Juneon September 30, 2021, and December 31, 2020. The required amounts for capital adequacy shown below do not include the capital conservation buffer previously discussed.
Actual | Minimum for capital adequacy | Minimum to be well capitalized | ||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | Amount | Ratio | Amount | Ratio | Amount | Ratio | ||||||||||||||||||||||||||||||||
September 30, 2021 | ||||||||||||||||||||||||||||||||||||||
Total capital ratio | ||||||||||||||||||||||||||||||||||||||
Bank | $ | 206,776 | 12.9% | $ | 127,860 | 8.0% | $ | 159,824 | 10.0% | |||||||||||||||||||||||||||||
Company | 224,537 | 14.0% | 127,860 | 8.0% | N/A | N/A | ||||||||||||||||||||||||||||||||
Tier 1 capital ratio | ||||||||||||||||||||||||||||||||||||||
Bank | 194,377 | 12.2% | 95,895 | 6.0% | 127,860 | 8.0% | ||||||||||||||||||||||||||||||||
Company | 202,122 | 12.6% | 95,895 | 6.0% | N/A | N/A | ||||||||||||||||||||||||||||||||
Tier1 leverage ratio | ||||||||||||||||||||||||||||||||||||||
Bank | 194,377 | 7.7% | 101,353 | 4.0% | 126,691 | 5.0% | ||||||||||||||||||||||||||||||||
Company | 202,122 | 8.0% | 101,353 | 4.0% | N/A | N/A | ||||||||||||||||||||||||||||||||
Common equity tier 1 capital ratio | ||||||||||||||||||||||||||||||||||||||
Bank | 194,377 | 12.2% | 71,921 | 4.5% | 103,886 | 6.5% | ||||||||||||||||||||||||||||||||
Company | 202,122 | 12.6% | 71,921 | 4.5% | N/A | N/A |
Actual | Minimum for capital adequacy | Minimum to be well capitalized | ||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | Amount | Ratio | Amount | Ratio | Amount | Ratio | ||||||||||||||||||||||||||||||||
December 31, 2020 | ||||||||||||||||||||||||||||||||||||||
Total capital ratio | ||||||||||||||||||||||||||||||||||||||
Bank | $ | 176,633 | 12.0% | $ | 117,298 | 8.0% | $ | 146,623 | 10.0% | |||||||||||||||||||||||||||||
Company | 215,977 | 14.7% | 117,298 | 8.0% | N/A | N/A | ||||||||||||||||||||||||||||||||
Tier 1 capital ratio | ||||||||||||||||||||||||||||||||||||||
Bank | 159,448 | 10.9% | 87,974 | 6.0% | 117,298 | 8.0% | ||||||||||||||||||||||||||||||||
Company | 188,639 | 12.9% | 87,974 | 6.0% | N/A | N/A | ||||||||||||||||||||||||||||||||
Tier1 leverage ratio | ||||||||||||||||||||||||||||||||||||||
Bank | 159,448 | 8.4% | 75,723 | 4.0% | 94,654 | 5.0% | ||||||||||||||||||||||||||||||||
Company | 188,639 | 10.0% | 75,723 | 4.0% | N/A | N/A | ||||||||||||||||||||||||||||||||
Common equity tier 1 capital ratio | ||||||||||||||||||||||||||||||||||||||
Bank | 159,448 | 10.9% | 65,980 | 4.5% | 95,305 | 6.5% | ||||||||||||||||||||||||||||||||
Company | 188,639 | 12.9% | 65,980 | 4.5% | N/A | N/A |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | Minimum to be well | | |||
| | Actual | | Minimum for capital adequacy | | capitalized | | |||||||||
(Dollars in thousands) |
| Amount |
| Ratio |
| Amount |
| Ratio |
| Amount |
| Ratio |
| |||
June 30, 2021 |
| |
|
|
|
| |
|
|
|
| |
|
|
| |
Total capital ratio |
| |
|
| |
| |
|
|
|
| |
|
|
| |
Bank | | $ | 198,836 |
| 12.8 | % | $ | 124,003 |
| 8.0 | % | $ | 155,004 |
| 10.0 | % |
Company | |
| 218,325 |
| 14.1 | % |
| 124,003 |
| 8.0 | % |
| N/A |
| N/A | |
Tier 1 capital ratio | |
|
|
| | |
|
|
|
| |
|
|
|
| |
Bank | |
| 187,416 |
| 12.1 | % |
| 93,002 |
| 6.0 | % |
| 124,003 |
| 8.0 | % |
Company | |
| 196,844 |
| 12.7 | % |
| 93,002 |
| 6.0 | % |
| N/A |
| N/A | |
Tier1 leverage ratio | |
|
|
| | |
|
|
|
| |
|
|
|
| |
Bank | |
| 187,416 |
| 7.4 | % |
| 101,368 |
| 4.0 | % |
| 126,710 |
| 5.0 | % |
Company | |
| 196,844 |
| 7.8 | % |
| 101,368 |
| 4.0 | % |
| N/A |
| N/A | |
Common equity tier 1 capital ratio | |
|
|
| | |
| |
|
| |
|
|
|
| |
Bank | |
| 187,416 |
| 12.1 | % |
| 69,752 |
| 4.5 | % |
| 100,753 |
| 6.5 | % |
Company | |
| 196,844 |
| 12.7 | % |
| 69,752 |
| 4.5 | % |
| N/A |
| N/A | |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | Minimum to be well |
| |||
| | Actual | | Minimum for capital adequacy | | capitalized |
| |||||||||
(Dollars in thousands) |
| Amount |
| Ratio |
| Amount |
| Ratio |
| Amount |
| Ratio |
| |||
December 31, 2020 | |
|
|
|
| |
|
|
|
| |
|
|
|
| |
Total capital ratio | |
|
|
|
| |
|
|
|
| |
|
|
|
| |
Bank | | $ | 176,633 |
| 12.0 | % | $ | 117,298 |
| 8.0 | % | $ | 146,623 |
| 10.0 | % |
Company | |
| 215,977 |
| 14.7 | % |
| 117,298 |
| 8.0 | % |
| N/A |
| N/A | |
Tier 1 capital ratio | |
|
|
| | |
|
|
|
| |
|
|
|
| |
Bank | |
| 159,448 |
| 10.9 | % |
| 87,974 |
| 6.0 | % |
| 117,298 |
| 8.0 | % |
Company | |
| 188,639 |
| 12.9 | % |
| 87,974 |
| 6.0 | % |
| N/A |
| N/A | |
Tier1 leverage ratio | |
|
|
| | |
|
|
|
| |
|
|
|
| |
Bank | |
| 159,448 |
| 8.4 | % |
| 75,723 |
| 4.0 | % |
| 94,654 |
| 5.0 | % |
Company | |
| 188,639 |
| 10.0 | % |
| 75,723 |
| 4.0 | % |
| N/A |
| N/A | |
Common equity tier 1 capital ratio | |
|
|
| | |
| |
|
| |
|
|
|
| |
Bank | |
| 159,448 |
| 10.9 | % |
| 65,980 |
| 4.5 | % |
| 95,305 |
| 6.5 | % |
Company | |
| 188,639 |
| 12.9 | % |
| 65,980 |
| 4.5 | % |
| N/A |
| N/A | |
26
| | | | | | | | | | | | |
| | Three Months Ended | | Three Months Ended | | Six Months Ended | | Six Months Ended | ||||
|
| June 30, 2021 | | June 30, 2020 | | June 30, 2021 |
| June 30, 2020 | ||||
Operating Lease and Interest Cost | | $ | 326 | | $ | 445 | | $ | 794 | | $ | 756 |
Variable Lease Cost | |
| 82 | |
| 142 | |
| 199 | |
| 249 |
Total Lease Cost | | $ | 408 | | $ | 587 | | $ | 993 | | $ | 1,005 |
Three Months Ended September 30, 2021 | Three Months Ended September 30, 2020 | Nine Months Ended September 30, 2021 | Nine Months Ended September 30, 2020 | ||||||||||||||||||||
Operating Lease and Interest Cost | $ | 335 | $ | 507 | $ | 1,128 | $ | 1,264 | |||||||||||||||
Variable Lease Cost | 106 | 120 | 305 | 369 | |||||||||||||||||||
Total Lease Cost | $ | 441 | $ | 627 | $ | 1,433 | $ | 1,633 |
| | | | | | | | | | | | | |
| | Three Months Ended | | Three Months Ended | | Six Months Ended | | Six Months Ended | | ||||
|
| June 30, 2021 | | June 30, 2020 | | June 30, 2021 |
| June 30, 2020 | | ||||
Operating Lease - Operating Cash Flows (Fixed Payments) | | $ | 326 | | $ | 445 | | $ | 793 | | $ | 756 | |
Operating Lease - Operating Cash Flows (Liability Reduction) | | $ | 296 | | $ | 416 | | $ | 921 | | $ | 669 | |
New ROU Assets - Operating Leases | | $ | — | | $ | — | | $ | — | | $ | 1,620 | |
Weighted Average Lease Term (Years) - Operating Leases | | | | | | | | | 5.25 | | | 6.02 | |
Weighted Average Discount Rate - Operating Leases | | | | % | | | % | | 3.13 | % | | 3.02 | % |
Three Months Ended September 30, 2021 | Three Months Ended September 30, 2020 | Nine Months Ended September 30, 2021 | Nine Months Ended September 30, 2020 | ||||||||||||||||||||
Operating Lease - Operating Cash Flows (Fixed Payments) | $ | 335 | $ | 508 | $ | 1,129 | $ | 1,264 | |||||||||||||||
Operating Lease - Operating Cash Flows (Liability Reduction) | $ | 123 | $ | 612 | $ | 1,044 | $ | 1,281 | |||||||||||||||
New ROU Assets - Operating Leases | $ | 165 | $ | 60 | $ | 165 | $ | 1,680 | |||||||||||||||
Weighted Average Lease Term (Years) - Operating Leases | 5.01 | 5.85 | |||||||||||||||||||||
Weighted Average Discount Rate - Operating Leases | 3.13 | % | 3.05 | % |
| | | |
|
| June 30, 2021 | |
Operating lease payments due: |
| |
|
Within one year | | $ | 1,400 |
After one but within two years | |
| 1,421 |
After two but within three years | | | 1,296 |
After three but within four years | | | 1,093 |
After four years but within five years | | | 955 |
After five years | | | 706 |
Total undiscounted cash flows | | | 6,871 |
Discount on cash flows | | | (1,291) |
Total operating lease liabilities | | $ | 5,580 |
27
September 30, 2021 | |||||
Operating lease payments due: | |||||
Within one year | $ | 1,443 | |||
After one but within two years | 1,426 | ||||
After two but within three years | 1,212 | ||||
After three but within four years | 1,097 | ||||
After four years but within five years | 766 | ||||
After five years | 620 | ||||
Total undiscounted cash flows | 6,564 | ||||
Discount on cash flows | (1,107) | ||||
Total operating lease liabilities | $ | 5,457 |
NOTE 16 — SUBSEQUENT EVENTS
Loan Production Offices
28
•the strength of the United States economy in general and the strength of the local economies in which we conduct operations; •the effects of our lack of a diversified loan portfolio and concentration in the South Florida market, including the risks of geographic, depositor, and industry concentrations, including our concentration in loans secured by real estate; •the duration and severity of the COVID-19 pandemic and the severity of COVID variants both in our principal area of operations and nationally, and the impact of the pandemic, including the government’s responses to the pandemic, on our and our customers’ operations, personnel, and business activity (including developments and volatility), as well as the pandemic’s impact on the credit quality of our loan portfolio and on financial market and general economic conditions; •the frequency and magnitude of foreclosure of our loans; •changes in the securities, real estate markets and commodities markets (including fluctuations in the price of coffee or oil); •our ability to successfully manage interest rate risk, credit risk, liquidity risk, and other risks inherent to our industry; •the accuracy of our financial statement estimates and assumptions, including the estimates used for our loan loss reserve and deferred tax asset valuation allowance; •increased competition and its effect on pricing of our products and services as well as our margins; • |
legislative or regulatory changes; |
29
30
Results of Operations for the three months ended JuneSeptember 30, 2021
At JuneNet interest income increased $12.4 million, or 29.6%, to $54.2 million compared to the prior year primarily due to loan growth and an increase in forgiveness of Professional Bank PPP loans resulting in a higher amount of loan fees recognized in addition to a reduction in interest expense on deposit accounts..
31
Three Months Ended June 30, (Dollars in thousands) 2021 2020 Change Interest income $ 18,962 $ 18,522 2.4 % Interest expense 1,760 2,231 (21.1) % Net Interest income 17,202 16,291 5.6 % Provision for loan losses 762 1,750 (56.5) % Net interest income after provision 16,440 14,541 13.1 % Noninterest income 2,302 968 137.8 % Noninterest expense 10,954 11,548 (5.1) % Income before income taxes 7,788 3,961 96.6 % Income tax expense 1,457 830 75.5 % Net income $ 6,331 $ 3,131 102.2 % expenses, partially offset by higher salaries and employee benefits as a result of our continued growth. using effective asset-liability management techniques is critical to maintaining the stability of our net interest income and net interest margin as our primary sources of earnings. For the Three Months Ended June 30, 2021 2020 Average Interest Average Interest Outstanding Income/ Average Outstanding Income/ Average (Dollars in thousands) Balance Expense(4) Yield/Rate Balance Expense(4) Yield/Rate Assets Interest earning assets Interest-bearing deposits $ 580,632 $ 178 0.12 % $ 170,658 $ 44 0.10 % Federal funds sold 69,506 24 0.14 % 32,965 12 0.15 % Federal Reserve Bank stock, FHLB stock and other corporate stock 7,391 99 5.37 % 7,598 131 6.93 % Investment securities - taxable 70,137 161 0.92 % 88,365 241 1.10 % Investment securities - tax exempt 20,172 189 3.76 % 20,973 197 3.78 % Loans(1) 1,699,403 18,311 4.32 % 1,501,590 17,897 4.79 % Total interest earning assets 2,447,241 18,962 3.11 % 1,822,149 18,522 4.09 % Loans held for sale 2,638 — Noninterest earning assets 115,358 102,663 Total assets $ 2,565,237 $ 1,924,812 Liabilities and stockholders’ equity Interest-bearing liabilities Interest-bearing deposits 1,377,712 1,430 0.42 % 994,972 1,617 0.65 % Borrowed funds 56,347 330 2.35 % 230,516 614 1.07 % Total interest-bearing liabilities 1,434,059 1,760 0.49 % 1,225,488 2,231 0.73 % Noninterest-bearing liabilities Noninterest-bearing deposits 890,292 475,613 Other noninterest-bearing liabilities 17,690 19,540 Stockholders’ equity 223,196 204,171 Total liabilities and stockholders’ equity $ 2,565,237 $ 1,924,812 Net interest spread(2) 2.62 % 3.36 % Net interest income $ 17,202 $ 16,291 Net interest margin(3) 2.82 % 3.60 % The following table presents information regarding the dollar amount of changes in interest income and interest expense for the periods indicated for each major component of interest earning assets and interest-bearing liabilities and distinguishes between the changes attributable to changes in volume and changes attributable to changes in interest rates. For purposes of this table, changes attributable to both rate and volume that cannot be segregated have been proportionately allocated to both volume and rate. For the Three Months Ended June 30, 2021 Compared to 2020 Change Due To (Dollars in thousands) Volume Rate Total Interest income Interest-bearing deposits $ 106 $ 28 $ 134 Federal funds sold 13 (1) 12 Federal Reserve Bank stock, Federal Home Loan Bank stock and other corporate stock (4) (28) (32) Investment securities - taxable (50) (30) (80) Investment securities - tax exempt (8) — (8) Loans 2,358 (1,944) 414 Total $ 2,415 $ (1,975) $ 440 Interest expense Interest-bearing deposits 622 (809) (187) Borrowed funds (464) 180 (284) Total $ 158 $ (629) $ (471) originations. Provision for Loan Losses extent they exceed the direct loan origination costs, which are generally recognized over the life of the related loan as an adjustment to yield using the interest method. Three Months Ended June 30, (Dollars in thousands) 2021 2020 Increase (Decrease) Noninterest income Service charges on deposit accounts $ 1,199 $ 307 290.6 % Income from Bank owned life insurance 281 126 123.0 % Gain on sale and call of securities 21 11 90.9 % SBA origination fees — 84 (100.0) % SWAP fees 364 210 73.3 % Third party loan sales 226 157 43.9 % Other 211 73 189.0 % Total noninterest income $ 2,302 $ 968 137.8 % decrease in third party loan sales. Three Months Ended June 30, Increase (Dollars in thousands) 2021 2020 (Decrease) Noninterest expense Salaries and employee benefits $ 7,099 $ 6,912 2.7 % Occupancy and equipment 905 1,081 (16.3) % Data processing 276 421 (34.4) % Marketing 165 151 9.3 % Professional fees 770 806 (4.5) % Acquisition expenses — 560 (100.0) % Regulatory assessments 418 300 39.3 % Other 1,321 1,317 0.3 % Total noninterest expense $ 10,954 $ 11,548 (5.1) % liabilities are adjusted through the provision for income taxes. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. 2020. Six Months Ended June 30, (Dollars in thousands) 2021 2020 Change Interest income $ 38,734 $ 29,542 31.1 % Interest expense 3,653 5,190 (29.6) % Net Interest income 35,081 24,352 44.1 % Provision for loan losses 1,800 2,595 (30.6) % Net interest income after provision 33,281 21,757 53.0 % Noninterest income 3,421 1,824 87.6 % Noninterest expense 22,742 21,034 8.1 % Income before income taxes 13,960 2,547 448.1 % Income tax expense 2,844 733 288.0 % Net income $ 11,116 $ 1,814 512.8 % The following table shows the average outstanding balance of each principal category of our assets, liabilities, and stockholders’ equity, together with the average yields on our assets and the average costs of our liabilities for the periods indicated. Such yields and costs are calculated by dividing the annualized income or expense by the average daily balances of the corresponding assets or liabilities for the same period. For the Six Months Ended June 30, 2021 2020 Average Interest Average Interest Outstanding Income/ Average Outstanding Income/ Average (Dollars in thousands) Balance Expense(4) Yield/Rate Balance Expense(4) Yield/Rate Assets Interest earning assets Interest-bearing deposits $ 380,989 $ 224 0.12 % $ 173,907 $ 629 0.73 % Federal funds sold 56,955 40 0.14 % 33,954 131 0.78 % Federal Reserve Bank stock, FHLB stock and other corporate stock 7,676 194 5.11 % 6,550 210 6.45 % Investment securities - Taxable 69,968 340 0.98 % 68,085 454 1.34 % Investment securities - Non-taxable 20,902 392 3.79 % 11,122 206 3.72 % Loans(1) 1,681,566 37,544 4.51 % 1,156,151 27,912 4.85 % Total interest earning assets 2,218,056 38,734 3.53 % 1,449,769 29,542 4.10 % Loans held for sale 1,999 1,186 Noninterest earning assets 122,420 80,730 Total assets $ 2,342,475 $ 1,531,685 Liabilities and shareholders’ equity Interest-bearing liabilities Interest-bearing deposits 1,293,693 2,747 0.43 % 879,749 4,243 0.97 % Borrowed funds 101,129 906 1.81 % 146,828 947 1.30 % Total interest-bearing liabilities 1,394,822 3,653 0.53 % 1,026,577 5,190 1.02 % Noninterest-bearing liabilities Noninterest-bearing deposits 708,215 332,474 Other noninterest-bearing liabilities 18,288 15,801 Shareholders’ equity 221,150 156,833 Total liabilities and shareholders’ equity $ 2,342,475 $ 1,531,685 Net interest spread(2) 3.00 % 3.08 % Net interest income $ 35,081 $ 24,352 Net interest margin(3) 3.20 % 3.38 % For the Six Months Ended June 30, 2021 Compared to 2020 Change Due To (Dollars in thousands) Volume Rate Total Interest income Interest-bearing deposits $ 749 $ (1,154) $ (405) Federal funds sold 89 (180) (91) Federal Reserve Bank stock, Federal Home Loan Bank stock and other corporate stock 36 (52) (16) Investment securities - taxable 13 (127) (114) Investment securities - tax exempt 181 5 186 Loans 12,685 (3,053) 9,632 Total $ 13,753 $ (4,561) $ 9,192 Interest expense Interest-bearing deposits 1,996 (3,492) (1,496) Borrowed funds (295) 254 (41) Total $ 1,701 $ (3,238) $ (1,537) Net interest income increased by Noninterest Income Six Months Ended June 30, (Dollars in thousands) 2021 2020 Increase (Decrease) Noninterest income Service charges on deposit accounts $ 1,594 $ 529 201.3 % Income from Bank owned life insurance 563 255 120.8 % Gain on sale and call of securities 22 15 46.7 % SBA origination fees 145 114 27.2 % SWAP fees 573 473 21.1 % Third party loan sales 301 267 12.7 % Other 223 171 30.4 % Total noninterest income $ 3,421 $ 1,824 87.6 % fee income. Six Months Ended June 30, Increase (Dollars in thousands) 2021 2020 (Decrease) Noninterest expense Salaries and employee benefits $ 13,883 $ 12,175 14.0 % Occupancy and equipment 2,007 1,855 8.2 % Data processing 566 597 (5.2) % Marketing 318 288 10.4 % Professional fees 1,398 1,161 20.4 % Acquisition expenses 684 2,223 (69.2) % Regulatory assessments 767 514 49.2 % Other 3,119 2,221 40.4 % Total noninterest expense $ 22,742 $ 21,034 8.1 % infrastructure, offset by a reduction in acquisition expenses. The Bank’s number of employees increased from 2020. loss. Gains and losses on the sale of available-for-sale securities are recorded on the trade date and are determined using the specific-identification method. Premiums and discounts on securities available for sale are recognized in interest income using the interest method over the period to maturity. June 30, 2021 December 31, 2020 (Dollars in thousands) Book Value Fair Value Book Value Fair Value Securities Available for Sale - taxable Small Business Administration loan pools $ 43,091 $ 42,596 $ 30,678 $ 30,556 Mortgage-backed securities 54,517 54,540 28,514 28,922 United States agency obligations 2,001 2,089 3,000 3,122 Corporate bonds 1,500 1,510 2,501 2,510 Total $ 101,109 $ 100,735 $ 64,693 $ 65,110 Securities Available for Sale - tax exempt Community Development District bonds $ 17,954 $ 18,658 $ 20,582 $ 21,299 Municipals 1,057 1,103 1,064 1,099 Total $ 19,011 $ 19,761 $ 21,646 $ 22,398 Securities Held to Maturity Mortgage-backed securities 285 296 345 359 United States Treasury — — 202 202 Foreign Bonds 1,000 1,000 1,000 1,000 Total $ 1,285 $ 1,296 $ 1,547 $ 1,561 Equity Securities Mutual Funds 5,942 5,942 6,005 6,005 Total $ 5,942 $ 5,942 $ 6,005 $ 6,005 More than One Year More than Five Years One Year or Less Through Five Years Through 10 Years More than 10 Years Total Weighted Weighted Weighted Weighted Weighted At June 30, 2021 Average Average Average Average Average (Dollars in thousands) Book Value Yield Book Value Yield Book Value Yield Book Value Yield Book Value Fair Value Yield Securities Available for Sale - taxable Small Business Administration loan pools $ — — % $ 609 0.96 % $ 19,879 1.51 % $ 22,603 1.38 % $ 43,091 $ 42,596 1.43 % Mortgage-backed securities — — % — — % 6,361 0.74 % 48,156 1.27 % 54,517 54,540 1.21 % United States agency obligations 998 2.54 % 1,003 2.66 % — — % — — % 2,001 2,089 2.60 % Corporate bonds — — % 1,500 1.18 % — — % — — % 1,500 1,510 1.18 % Total $ 998 2.54 % $ 3,112 1.61 % $ 26,240 1.32 % $ 70,759 1.31 % $ 101,109 $ 100,735 1.33 % Securities Available for Sale - tax exempt Community Development District bonds $ 40 4.00 % $ 17,599 3.87 % $ 315 3.00 % $ — — % $ 17,954 $ 18,658 3.86 % Municipals — — % 1,057 1.75 % — — % — — % 1,057 1,103 1.75 % Total $ 40 4.00 % $ 18,656 3.75 % $ 315 3.00 % $ — — % $ 19,011 $ 19,761 3.74 % Securities Held to Maturity Mortgage-backed securities — — % — — % — — % 285 2.57 % 285 296 2.57 % United States Treasury — — % — — % — — % — — % — — — % Foreign Bonds 1,000 0.47 % — — % — — % — — % 1,000 1,000 0.47 % Total $ 1,000 0.47 % $ — — % $ — — % $ 285 2.57 % $ 1,285 $ 1,296 0.93 % Equity Securities Mutual Funds 5,942 1.13 % — — % — — % — — % 5,942 5,942 1.13 % Total $ 5,942 1.13 % $ — — % $ — — % $ — — % $ 5,942 $ 5,942 1.13 % June 30, 2021 December 31, 2020 (Dollars in thousands) Amount Percent Amount Percent Commercial real estate $ 875,453 51.4 % $ 777,776 46.7 % Owner Occupied 305,854 — 286,992 — Non-Owner Occupied 569,599 — 490,784 — Residential real estate 361,946 21.3 % 380,491 22.8 % Commercial (Non-PPP) 229,215 13.5 % 206,665 12.4 % Commercial (PPP) 144,118 8.5 % 189,977 11.4 % Construction and development 74,175 4.4 % 99,883 6.0 % Consumer and other loans 14,575 0.9 % 11,688 0.7 % Total loans $ 1,699,482 100.0 % $ 1,666,480 100.0 % Unearned loan origination (fees) costs, net (1,984) (1,323) Unearned PPP loan origination (fees) costs, net (4,855) (4,255) Allowance for loan loss (10,418) (16,259) Loans held for sale (2,039) (1,270) Other (18) — Loans, net $ 1,680,168 $ 1,643,373 Commercial Real Estate Loans. We originate both owner-occupied and non-owner-occupied commercial real estate loans. These loans may be more adversely affected by conditions in the real estate markets or in the general economy. Commercial real estate loans that are secured by owner-occupied commercial real estate and primarily As of June 30, 2021 As of December 31, 2020 (Dollars in thousands) Amount Percent Amount Percent Commercial Real Estate Auto (Car Lot/Auto Repair) $ 28,055 3.2 % $ 22,483 2.9 % Educational Facility 32,979 3.8 % 14,328 1.8 % Gas Station 70,053 8.0 % 64,162 8.2 % Hotel 61,887 7.1 % 54,324 7.0 % Mixed Use 36,756 4.2 % 29,987 3.9 % Multifamily 118,978 13.6 % 98,837 12.7 % Office 106,333 12.1 % 111,850 14.4 % Other / Special Use 43,467 5.0 % 41,739 5.4 % Religious Facility 8,175 0.9 % 8,450 1.1 % Retail 215,402 24.6 % 192,105 24.7 % Vacant Land 7,491 0.9 % 7,847 1.0 % Warehouse 145,877 16.7 % 131,664 16.9 % Total $ 875,453 100.0 % $ 777,776 100.0 % As of June 30, 2021 As of December 31, 2020 (Dollars in thousands) Amount Percent Amount Percent Commercial Real Estate Broward $ 130,231 14.9 % $ 118,408 15.2 % Miami-Dade 538,691 61.5 % 501,168 64.4 % Palm Beach 144,719 16.5 % 113,405 14.6 % Other FL County 37,491 4.3 % 27,154 3.5 % Out of State 24,321 2.8 % 17,641 2.3 % Total $ 875,453 100.0 % $ 777,776 100.0 % As of As of June 30, 2021 As of December 31, 2020 (Dollars in thousands) Amount Percent Amount Percent Construction & Development 1 – 4 Family Construction $ 39,783 53.6 % $ 45,209 45.3 % Commercial Construction 11,985 16.2 % 34,082 34.1 % Land Development 5,241 7.1 % 5,789 5.8 % Vacant Land 17,166 23.1 % 14,803 14.8 % Total $ 74,175 100.0 % $ 99,883 100.0 % As of June 30, 2021 As of December 31, 2020 (Dollars in thousands) Amount Percent Amount Percent Construction & Development Broward $ 2,799 3.8 % $ 21,737 21.8 % Miami-Dade 49,586 66.9 % 57,192 57.3 % Palm Beach 16,268 21.9 % 15,137 15.2 % Other FL County 5,522 7.4 % 5,817 5.8 % Total $ 74,175 100.0 % $ 99,883 100.0 % As of As of June 30, 2021 As of December 31, 2020 (Dollars in thousands) Amount Percent LTV (%) Amount Percent LTV (%) Residential Real Estate Owner Occupied $ 247,239 68.3 % 57.1 % $ 270,960 71.2 % 57.8 % Investor Owned Residences 59,830 16.5 % 52.8 % 48,026 12.6 % 50.7 % HELOC 52,838 14.6 % 56.6 % 60,235 15.8 % 57.1 % Loans Held for Sale 2,039 0.6 % 0.0 % 1,270 0.3 % 0.0 % Total $ 361,946 100.0 % $ 380,491 100.0 % Commercial Loans. In addition to our other loan products, we provide general commercial loans, including commercial lines of credit, working capital loans, term loans, equipment financing, letters of credit and other loan products, primarily in our market, and underwritten based on each borrower’s ability to service debt from income. These loans are primarily made based on the identified cash flows of the borrower, as determined based on a review of the client’s financial statements, and secondarily, on the underlying collateral provided by the borrower. The average loan balance of the accounts receivable, promissory notes, inventory and equipment, and we generally obtain a personal guaranty from the borrower or other principal. The following table shows our commercial loan portfolio by industry segment as of As of June 30, 2021 As of December 31, 2020 (Dollars in thousands) Amount Percent Amount Percent Commercial Loans Business Products $ 1,152 0.5 % $ 1,163 0.6 % Business Services 57,052 24.9 % 29,584 14.3 % Communication 17,733 7.7 % 17,740 8.6 % Construction 20,490 8.9 % 19,269 9.3 % Finance 48,677 21.2 % 56,652 27.4 % Healthcare 6,699 2.9 % 7,379 3.6 % Services 36,868 16.1 % 23,319 11.3 % Technology 802 0.3 % 853 0.4 % Trade 32,298 14.1 % 44,359 21.5 % Transportation 2,010 0.9 % 2,928 1.4 % Other 5,434 2.4 % 3,419 1.7 % Total $ 229,215 100.0 % $ 206,665 100.0 % Consumer and Other Loans. We offer consumer, or retail credit, to individuals for household, family, or other personal expenditures. Generally, these are either in the form of closed-end/installment credit loans or open-end/revolving credit loans. Occasionally, we will make unsecured consumer loans to highly qualified clients in amounts up to $250,000 with up to three-year repayment terms. The following chart illustrates our gross loans and weighted average loan-to-value ratio for our collateralized loan portfolio as of the end of the periods indicated. June 30, 2021 Due in One Due in One to Due After (Dollars in thousands) Year or Less Five Years Five Years Total Commercial Real Estate $ 98,118 $ 230,947 $ 546,388 $ 875,453 Residential Real Estate 14,141 19,401 328,404 361,946 Commercial* 108,402 166,295 98,636 373,333 Construction and Development 29,355 20,219 24,601 74,175 Consumer and Other 4,141 7,330 3,104 14,575 Total loans $ 254,157 $ 444,192 $ 1,001,133 $ 1,699,482 Amounts with fixed rates $ 149,697 $ 398,716 $ 965,071 $ 1,513,484 Amounts with floating rates $ 104,460 $ 45,476 $ 36,062 $ 185,998 *Includes Paycheck Protection Program (PPP) loans. December 31, 2020 Due in One Due in One to Due After (Dollars in thousands) Year or Less Five Years Five Years Total Commercial Real Estate $ 63,277 $ 221,328 $ 493,171 $ 777,776 Residential Real Estate 16,386 23,832 340,273 380,491 Commercial* 93,338 232,428 70,876 396,642 Construction and Development 37,205 30,165 32,513 99,883 Consumer and Other 5,619 3,855 2,214 11,688 Total loans $ 215,825 $ 511,608 $ 939,047 $ 1,666,480 Amounts with fixed rates $ 110,152 $ 473,839 $ 910,452 $ 1,494,443 Amounts with floating rates $ 105,673 $ 37,769 $ 28,595 $ 172,037 *Includes Paycheck Protection Program (PPP) loans. Paycheck Protection Program factor in the recent increase in our nonperforming assets relative to our historically low, near-zero levels. However, we believe that our low loan-to-value loan portfolio is well positioned to withstand these types of discrete events as they occur from time. There can be no assurance, however, that our loan portfolio will not become subject to increasing pressures from deteriorating borrower credit due to general economic conditions. (Dollars in thousands) June 30, 2021 December 31, 2020 Nonaccrual Loans Commercial real estate $ — $ — Residential real estate — — Commercial 1,468 9,127 Construction and development — — Consumer and other loans 1,307 1,307 Accruing loans 90 or more days past due — — Total nonperforming loans $ 2,775 $ 10,434 Other real estate owned — — Total nonperforming assets $ 2,775 $ 10,434 Restructured loans-nonaccrual $ — $ — Restructured loans-accruing $ 252 $ 298 Ratio of nonperforming loans to total loans 0.16 % 0.63 % Ratio of nonperforming assets to total assets 0.11 % 0.51 % substandard, doubtful, or even a charged-off status. Based on the most recent analysis performed, the risk category of loans by class of loans is as follows: Special (Dollars in thousands) Pass Mention Substandard Doubtful Total June 30, 2021 Commercial real estate $ 873,127 $ — $ 2,326 $ — $ 875,453 Residential real estate 361,946 — — — 361,946 Commercial 371,400 465 1,468 — 373,333 Construction and land development 74,175 — — — 74,175 Consumer 13,174 94 1,307 — 14,575 Total $ 1,693,822 $ 559 $ 5,101 $ — $ 1,699,482 December 31, 2020 Commercial real estate $ 775,420 $ — $ 2,356 $ — $ 777,776 Residential real estate 380,062 429 — — 380,491 Commercial 387,403 112 9,127 — 396,642 Construction and land development 99,883 — — — 99,883 Consumer 10,381 — 1,307 — 11,688 Total $ 1,653,149 $ 541 $ 12,790 $ — $ 1,666,480 adjusted for various internal and external risk factors unique to each loan pool. The following table analyzes the activity in the allowance over the past two years and for the For the Six Months Ended June 30, For the Year Ended December 31, (Dollars in thousands) 2021 2020 2020 2019 Balance at beginning of period $ 16,259 $ 6,548 $ 6,548 $ 5,685 Charge-offs Commercial real estate — — — — Residential real estate — — (207) — Commercial (7,641) (98) (99) — Construction and development — — — — Consumer and other — — — — Total Charge-offs (7,641) (98) (306) — Recoveries Commercial real estate — — — — Residential real estate — — — — Commercial — — — — Construction and development — — — — Consumer and other — — — 1 Total recoveries — — — 1 Net charge-offs (recoveries) (7,641) (98) (306) — Provision for loan losses 1,800 2,595 10,017 862 Balance at end of period $ 10,418 $ 9,045 $ 16,259 $ 6,548 ALLL as a percentage of total loans at end of period 0.62 % 0.58 % 0.99 % 0.83 % ALLL as a percentage of loans (excluding PPP loans) at end of period 0.67 % 0.67 % 1.10 % 0.83 % ALLL as a multiple of net charge-offs N/A N/A 53.1 N/A ALLL as a percentage of nonperforming loans 375.4 % 224.4 % 155.8 % 287.2 % June 30, 2021 December 31, 2020 (Dollars in thousands) Allowance Percent Allowance Percent Commercial real estate $ 4,285 41.1 % $ 3,159 19.4 % Residential real estate 2,269 21.8 % 2,177 13.4 % Commercial 3,423 32.9 % 10,462 64.3 % Construction and development 361 3.5 % 388 2.4 % Consumer and other 80 0.8 % 73 0.4 % Total allowance for loan losses $ 10,418 100.0 % $ 16,259 100.0 % Deposits are our primary source of funding. We offer a variety of deposit products including checking, NOW, savings, money market, and time accounts all of which we actively market at competitive pricing. We generate deposits from our consumer and commercial clients through the efforts of our private bankers. We had public deposits of For the Six Months Ended For the Year Ended June 30, 2021 December 31, 2020 Average Average (Dollars in thousands) Balance Average Rate Balance Average Rate NOW accounts $ 262,165 0.21 % $ 167,991 0.26 % Money market accounts 746,474 0.40 % 586,240 0.65 % Brokered deposits 30,475 0.63 % 11,339 0.90 % Savings accounts 10,590 0.10 % 7,564 0.13 % Certificates of deposit 243,989 0.73 % 216,467 1.13 % Total interest-bearing deposits 1,293,693 0.43 % 989,601 0.97 % Noninterest-bearing deposits 708,215 — % 410,357 — % Total deposits $ 2,001,908 0.28 % $ 1,399,958 0.48 % For the Six Months Ended For the Year Ended June 30, 2021 December 31, 2020 Ending Ending (Dollars in thousands) Balance % of Total Balance % of Total NOW accounts $ 286,173 12.6 % $ 232,367 14.0 % Money market accounts 810,913 35.6 % 679,761 41.0 % Brokered deposits 56,534 2.5 % 30,137 1.8 % Savings accounts 11,814 0.5 % 9,727 0.6 % Certificates of deposit 257,056 11.3 % 231,953 14.0 % Total interest-bearing deposits 1,422,490 62.5 % 1,183,945 71.3 % Noninterest-bearing deposits 854,673 37.5 % 475,598 28.7 % Total deposits(1) $ 2,277,163 100.0 % $ 1,659,543 100.0 % Over Over Six Three Three Months Months or Through Through Over (Dollars in thousands) Less Six Months 12 Months 12 Months Total Time deposits less than $100,000 $ 4,145 $ 3,059 $ 9,717 $ 3,445 $ 20,366 Time deposits greater than or equal to $100,000 35,008 34,227 118,680 53,399 241,314 Total $ 39,153 $ 37,286 $ 128,397 $ 56,844 $ 261,680 Over Over Six Three Three Months Months or Through Through Over (Dollars in thousands) Less Six Months 12 Months 12 Months Total Time deposits less than $100,000 $ 5,429 $ 3,392 $ 6,691 $ 4,602 $ 20,114 Time deposits greater than or equal to $100,000 55,527 45,180 60,959 54,795 216,461 Total $ 60,956 $ 48,572 $ 67,650 $ 59,397 $ 236,575 refer to Note 6 to the Consolidated Financial Statements (unaudited) dated September 30, 2021, entitled "Deposits." Six Months Ended Year Ended (Dollars in thousands) June 30, 2021 December 31, 2020 Amount outstanding at period-end $ 35,000 $ 40,000 Weighted average interest rate at period-end 2.04 % 1.96 % Maximum month-end balance during period $ 40,000 $ 70,000 Average balance outstanding during period 38,867 58,210 Weighted average interest rate during period 1.98 % 1.63 % Federal Reserve Bank of Atlanta. The Federal Reserve Bank of Atlanta has an available borrower in custody arrangement which allows us to borrow on a collateralized basis. No advances were outstanding under this facility as of The following table presents our regulatory capital ratios as of Minimum to be well Actual Minimum for capital adequacy capitalized (Dollars in thousands) Amount Ratio Amount Ratio Amount Ratio June 30, 2021 Total capital ratio Bank $ 198,836 12.8 % $ 124,003 8.0 % $ 155,004 10.0 % Company 218,325 14.1 % 124,003 8.0 % N/A N/A Tier 1 capital ratio Bank 187,416 12.1 % 93,002 6.0 % 124,003 8.0 % Company 196,844 12.7 % 93,002 6.0 % N/A N/A Tier1 leverage ratio Bank 187,416 7.4 % 101,368 4.0 % 126,710 5.0 % Company 196,844 7.8 % 101,368 4.0 % N/A N/A Common equity tier 1 capital ratio Bank 187,416 12.1 % 69,752 4.5 % 100,753 6.5 % Company 196,844 12.7 % 69,752 4.5 % N/A N/A Minimum to be well Actual Minimum for capital adequacy capitalized (Dollars in thousands) Amount Ratio Amount Ratio Amount Ratio December 31, 2020 Total capital ratio Bank $ 176,633 12.0 % $ 117,298 8.0 % $ 146,623 10.0 % Company 215,977 14.7 % 117,298 8.0 % N/A N/A Tier 1 capital ratio Bank 159,448 10.9 % 87,974 6.0 % 117,298 8.0 % Company 188,639 12.9 % 87,974 6.0 % N/A N/A Tier1 leverage ratio Bank 159,448 8.4 % 75,723 4.0 % 94,654 5.0 % Company 188,639 10.0 % 75,723 4.0 % N/A N/A Common equity tier 1 capital ratio Bank 159,448 10.9 % 65,980 4.5 % 95,305 6.5 % Company 188,639 12.9 % 65,980 4.5 % N/A N/A We also view our investment portfolio as a liquidity source and have the option to pledge securities in our portfolio as collateral for borrowings or deposits, and/or sell selected securities. Due After Due after One Three Due in One Through Three Through Due After (Dollars in thousands) Year or Less Years Five Years Five Years Total FHLB advances $ — $ — $ 30,000 $ 5,000 $ 35,000 Certificates of deposit less than $100,000 16,921 3,405 40 — 20,366 Certificates of deposit $100,000 or more 187,915 53,399 — — 241,314 Operating leases 1,400 2,717 2,048 706 6,871 Subordinated debt — — — 10,062 10,062 Total $ 206,236 $ 59,521 $ 32,088 $ 15,768 $ 313,613 Our commitments associated with outstanding letters of credit and commitments to extend credit expiring by period as of the date indicated are summarized below. Since commitments associated with letters of credit and commitments to extend credit may expire unused, the amounts shown do not necessarily reflect the actual future cash funding requirements. (Dollars in thousands) June 30, 2021 December 31, 2020 Unfunded lines of credit $ 366,015 $ 356,955 Commitments to extend credit 83,857 40,629 Letters of credit 11,226 13,036 Total credit extension commitments $ 461,098 $ 410,620 Six Months Ended Year Ended June 30, 2021 December 31, 2020 Return on Average Assets 0.95 % 0.46 % Return on Average Equity 10.05 % 4.30 % Average Equity to Average Assets 9.44 % 10.64 % risk involving exchange rates, commodity prices, or equity prices. In asset and liability management activities, our policies are designed to minimize structural interest rate risk. AnalysisJuneSeptember 30, 2021, and 2020Three Months Ended September 30, (Dollars in thousands) 2021 2020 Change Interest income $ 20,890 $ 19,101 9.4 % Interest expense 1,786 1,641 8.8 % Net Interest income 19,104 17,460 9.4 % Provision for loan losses 1,060 5,957 (82.2) % Net interest income after provision 18,044 11,503 56.9 % Noninterest income 1,476 963 53.3 % Noninterest expense 11,624 11,713 (0.8) % Income before income taxes 7,896 753 948.6 % Income tax expense (benefit) 1,608 (197) (916.2) % Net income $ 6,288 $ 950 561.9 % JuneSeptember 30, 2021, was $6.3 million, an increase of $3.2$5.3 million, or 102.2%561.9%, compared to the three months ended JuneSeptember 30, 2020. InterestNet interest income increased $0.4 million while interest expense decreased $0.5 million, resulting in a net interest income increase of $0.9$1.6 million for the three months ended JuneSeptember 30, 2021, compared to the same period in the prior year. The increase in our net interest income year-over-year was primarily due to increased loan portfolio growth and decreased cost of funds to the Company.growth. Provision for loan losses decreased by $1.0$4.9 million for the three months ended JuneSeptember 30, 2021, compared to the same period in the prior year. The decrease in the provision expense was attributed primarily due to having addressed the impairment of a loan payoffsto Coex in higher risk categories offset by an increase in loan originations.the third quarter of 2020. The increase in noninterest income during the three months ended JuneSeptember 30, 2021, compared to the same period in the prior year was primarily due to increases in service charges on deposit accounts associated with the Correspondent Banking Relationship, and secondarily to an increase in SWAP fees, as well as a one-time credit due to the unwinding fee of a FHLB advance.Bank owned life insurance income. The decrease in noninterest expense for the three months ended JuneSeptember 30, 2021, compared to the same period in the prior year was primarily due to the lack of MBI acquisition expenses this quarter and to a lesser extent the realization of our implementation efforts regarding operational efficiencies in occupancy, equipment, and data processing expenses.32For the Three Months Ended September 30, 2021 2020 (Dollars in thousands) Average
Outstanding
BalanceAverage
Yield/RateAverage
Outstanding
BalanceAverage
Yield/RateAssets Interest earning assets Interest-bearing deposits $ 561,082 $ 212 0.15 % $ 251,613 $ 65 0.10 % Federal funds sold 36,264 10 0.11 % 30,164 12 0.16 % Federal Reserve Bank stock, FHLB stock and other corporate stock 7,521 96 5.06 % 8,998 103 4.55 % Investment securities - taxable 105,498 186 0.70 % 80,643 209 1.03 % Investment securities - tax exempt 19,402 177 3.62 % 23,583 224 3.77 % 1,702,137 20,209 4.71 % 1,572,833 18,488 4.68 % Total interest earning assets 2,431,904 20,890 3.41 % 1,967,834 19,101 3.86 % Loans held for sale 1,478 — Noninterest earning assets 125,751 99,075 Total assets $ 2,559,133 $ 2,066,909 Liabilities and stockholders’ equity Interest-bearing liabilities Interest-bearing deposits 1,463,138 1,476 0.40 % 1,049,556 1,165 0.44 % Borrowed funds 45,046 310 2.73 % 297,227 476 0.64 % Total interest-bearing liabilities 1,508,184 1,786 0.47 % 1,346,783 1,641 0.48 % Noninterest-bearing liabilities Noninterest-bearing deposits 810,042 494,415 Other noninterest-bearing liabilities 16,746 19,961 Stockholders’ equity 224,161 205,750 Total liabilities and stockholders’ equity $ 2,559,133 $ 2,066,909 2.94 % 3.38 % Net interest income $ 19,104 $ 17,460 3.12 % 3.53 % 33(1)Includes nonaccrual loans.(2)Net interest spread is the difference between interest earned on interest earning assets and interest paid on interest-bearing liabilities.(3)Net interest margin is a ratio of net interest income to average interest earning assets for the same period.(4)Interest income on loans includes loan fees of $1.8 million and $0.9 million for the three months ended June 30, 2021 and 2020, respectively.For the Three Months Ended September 30, 2021 Compared to 2020 Change Due To (Dollars in thousands) Volume Rate Total Interest income Interest-bearing deposits $ 80 $ 67 $ 147 Federal funds sold 2 (4) (2) Federal Reserve Bank stock, Federal Home Loan Bank stock and other corporate stock (17) 10 (7) Investment securities - taxable 64 (87) (23) Investment securities - tax exempt (40) (7) (47) Loans 1,520 201 1,721 Total $ 1,610 $ 179 $ 1,789 Interest expense Interest-bearing deposits 459 (148) 311 Borrowed funds (404) 238 (166) Total $ 55 $ 90 $ 145 $17.2$19.1 million for the three months ended September 30, 2021, up $1.9 million, or 11.1% compared to the three months ended June 30, 2021, down $0.7 million, or 3.8% compared to the three months ended March 31, 2021, primarily due to higher yieldingincreased loan payoffsportfolio growth and a decrease inthe acceleration of Professional Bank PPP loan fees associated with PPP loan34forgiveness.and purchase accounting marks from the MBI acquisition. Net interest margin decreased 83 basis points fromfor the firstthird quarter of 2021 was 3.12%, an increase of 30 basis points compared to 2.82% for the second quarter of 2021 due to an increase in low yielding cash assets and loan payoffs on higher yielding assets.2021. Our weighted average roll-off rate for loans paid off was 4.7%4.5% and the weighted average roll-on rate for loans originated was 3.9% at Juneon September 30, 2021.$0.9$1.6 million to $17.2$19.1 million for the three months ended JuneSeptember 30, 2021, compared to the three months ended JuneSeptember 30, 2020. Our total net interest income was impacted by an increase in interest earning assets, which was primarily due to increased balances in large low yielding cash assets, coupled with increasesan increase in our loan portfolio of lower yielding loans, offset by decreased cost of funds to the Company. Average total interest earning assets were $2.4 billion for the three months ended JuneSeptember 30, 2021, compared with $1.8to $2.0 billion for the three months ended JuneSeptember 30, 2020.2020. The annualized yield on those interest earning assets decreased 9845 basis points for the three months ended JuneSeptember 30, 2021, compared to the three months ended September 30, 2020, primarily due to loans repricing downward, coupled withincreased cash balances and accelerated paydowns of principal in higher yielding loan payoffs. Theloans and investments. The increase in the average balance of interest earning assets was driven primarily by our growth in cash of $359.9,$309.5 million, or 123.0%, and growth in our loan portfolio of $120.3$129.3 million, or 7.7%8.2%, compared to three months ended JuneSeptember 30, 2020. The growth in theour loan portfolio was due to organic loan originations and the Professional Bank PPP.JuneSeptember 30, 2021, increased due to organic deposit growth and grew by $208.6$161.4 million, or 17.0%12.0%, for the three months ended JuneSeptember 30, 2020. The increase was primarily due to a $382.7$413.6 million, a 38.5%or 39.4%, increase in the average balance of interest-bearing deposits. The increase in the average balance of interest-bearing deposits was primarily due to increases in negotiable orders of withdrawal (“NOW”) and money market accounts for the three months ended JuneSeptember 30, 2021, compared to the three months ended JuneSeptember 30, 2020, and, to a lesser extent, increases in certificates of deposit. The annualized average interest rate paid on average interest-bearing liabilities decreased to 0.49%0.47%, for the three months ended JuneSeptember 30, 2021, compared to 0.73%0.48% for the three months ended JuneSeptember 30, 2020. Annualized average interest rate paid on interest-bearing deposits decreased 234 basis points to 0.42%0.40%, and the annualized average interest rate paid on borrowed funds increased by 128209 basis points to 2.35%2.73%. The increases in annualized average interest rates primarily reflected an increase in interest earning assets, primarily due to increased balances in our low yielding cash assets as well as increases in our loan portfolio of lower yielding loans, offset by decreased cost of funds to the Company during the three months ended June 30, 2021. The average interest rate on borrowings during the quarter ended JuneSeptember 30, 2021, increased as we paid-off the Paycheck Protection Program Liquidity Facility (“PPPLF”) balances, leaving higher priced FHLBFederal Home Loan Bank ("FHLB") advances and subordinated debt as our borrowings. For the three months ended JuneSeptember 30, 2021, our average other noninterest-bearing liabilities decreased $1.9$3.2 million, or 9.5%, compared to the three months ended June 30, 2020. Average noninterest-bearing deposits also increased $414.7 million, or 87.2%16.1%, compared to the three months ended JuneSeptember 30, 2020. Average noninterest-bearing deposits alsoJuneSeptember 30, 2021, our annual net interest margin was 2.82%3.12% and net interest spread was 2.62%2.94%. For the three months ended JuneSeptember 30, 2020, annual net interest margin was 3.60%3.53% and net interest spread was 3.36%3.38%.35$0.8$1.1 million for the three months ended JuneSeptember 30, 2021, and $1.8$6.0 million for the three months ended JuneSeptember 30, 2020. The decrease from 2020 to 2021 was primarily due to the need for an increased reserve at the early stages of COVID-19 in 2020 and the decreasing impact of COVID-19 on the economy in 2021.2021 and having addressed the impairment of a loan to Coex in the third quarter of 2020. We did not record any net charge-offs for the three months ended JuneSeptember 30, 2021, andcompared to one loan that was charged-off for $0.2 million for the three months ended September 30, 2020. Our allowance for loan losses as a percentage of total loans (excluding Professional Bank PPP loans) was 0.67% at 0.72% on JuneSeptember 30, 2021, compared to 1.10% at on December 31, 2020. See Reconciliation of non-GAAP Financial Measures.fees,fee income, origination fees for SBA loans, and other fees and charges. Noninterest income does not include loan origination fees to the36Three Months Ended September 30, (Dollars in thousands) 2021 2020 Increase (Decrease) Noninterest income Service charges on deposit accounts $ 643 $ 319 101.6% Income from Bank owned life insurance 281 123 128.5% SBA origination fees 21 — 100.0% SWAP fee income 208 149 39.6% Third party loan sales 161 252 (36.1)% Gain on sale and call of securities 1 1 —% Other 161 119 35.3% Total noninterest income $ 1,476 $ 963 53.3% JuneSeptember 30, 2021, was $2.3$1.5 million, a $1.3$0.5 million, or 137.8%53.3%, increase compared to the three months ended JuneSeptember 30, 2020. The increase was primarily due to increasesan increase in service charges on deposit accounts associated with the Correspondent Banking Relationship, secondarily to an increase in SWAP fees, as well asincome from Bank owned life insurance ("BOLI"), partially offset by a one-time credit due to the unwinding fee of a FHLB advance.JuneSeptember 30, 2021, entitledtitled "Customer Derivatives – Interest Rate SWAPs" for additional information regarding our derivative financial instruments.Three Months Ended September 30, (Dollars in thousands) 2021 2020 Increase (Decrease) Noninterest expense Salaries and employee benefits $ 7,350 $ 6,433 14.3% Occupancy and equipment 935 1,196 (21.8)% Data processing 303 374 (19.0)% Marketing 420 435 (3.4)% Professional fees 689 562 22.6% Acquisition expenses — 1,078 (100.0)% Regulatory assessments 481 250 92.4% Other 1,446 1,385 4.4% Total noninterest expense $ 11,624 $ 11,713 (0.8)% $11.0$11.6 million for the three months ended JuneSeptember 30, 2021, a decrease of $0.6$0.1 million, or 5.1%0.8%, compared to the three months ended JuneSeptember 30, 2020. The decrease was primarily due to the lack of MBI acquisition expenses this quarter and to a lesser extent the realization of our implementation efforts regarding operational efficiencies in occupancy, equipment, and data processing expenses, partially offset by higher salaries resulting from our opening of loan production offices in Tampa Bay and Jacksonville and investment in digital infrastructure. Additionally, the decrease in occupancy and equipment was due primarily to the Company exercising an option to early terminate a lease for one of the former operational offices of Marquis Bank and a branch located in Coral Gables (the "Option"). The Option resulted in savings of over $400 thousand in lease payments plus expenses.37$1.5$1.6 million for the three months ended JuneSeptember 30, 2021, compared to $0.8an income tax benefit of $0.2 million for the three months ended JuneSeptember 30, 2020. Our effective tax rates for those periods were 18.7%20.4% and 21.0%(25.7)%, respectively. The change in the effective tax rate was due to the decrease in nondeductible expenses, an increase in tax-exempt income, and an increasestate income tax credits in excess tax benefits from stock-based compensation.sixnine months ended JuneSeptember 30, 2021 and 2020Nine Months Ended September 30, (Dollars in thousands) 2021 2020 Change Interest income $ 59,624 $ 48,643 22.6% Interest expense 5,439 6,831 (20.4) % Net Interest income 54,185 41,812 29.6 % Provision for loan losses 2,860 8,552 (66.6) % Net interest income after provision 51,325 33,260 54.3 % Noninterest income 4,897 2,787 75.7 % Noninterest expense 34,366 32,747 4.9 % Income before income taxes 21,856 3,300 562.3 % Income tax expense 4,452 536 730.6 % Net income $ 17,404 $ 2,764 529.7 % sixnine months ended JuneSeptember 30, 2021, was $11.1$17.4 million, an increase of $9.3$14.6 million, or 512.8%529.7%, compared to the sixnine months ended JuneSeptember 30, 2020. Interest income increased $9.2$11.0 million while interest expense decreased $1.5$1.4 million, resulting in a net interest income increase of $10.7$12.4 million for the sixnine months ended JuneSeptember 30, 2021, compared to the same period in the prior year. The increase in our net interest income was primarily due to the MBI Variance, increased loan portfolio growth, and decreased cost of funds to the Company. Provision for loan losses decreased by $0.8$5.7 million for the sixnine months ended JuneSeptember 30, 2021, compared to the same period in the prior year. The decrease in the provision expense was due primarily todue to the need for anmacro environment stabilization following the increased reservereserves at the early stages of COVID-19 pandemic in 2020 and having addressed the decreasing impactimpairment of COVID-19 ona loan to Coex in the economy in 2021.third quarter of 2020. The increase in noninterest expense for the sixnine months ended JuneSeptember 30, 2021, compared to the same period in the prior year was primarily due to increased salaries and investment in digital infrastructure.infrastructure, partially offset by lower MBI acquisition expenses. The Bank’s number of employees increased from 137172 as of December 31, 2019,September 30, 2020, to 179205 as of JuneSeptember 30, 2020, which increase was due to the MBI acquisition, and further increased to 194 as of June 30, 2021.Net Interest Income and Net Interest Margin Analysis38For the Nine Months Ended September 30, 2021 2020 (Dollars in thousands) Average
Outstanding
BalanceAverage
Yield/RateAverage
Outstanding
BalanceAverage
Yield/RateAssets Interest earning assets Interest-bearing deposits $ 441,679 $ 436 0.13 % $ 201,730 $ 694 0.46 % Federal funds sold 49,982 50 0.13 % 32,682 143 0.58 % Federal Reserve Bank stock, FHLB stock and other corporate stock 7,624 290 5.09 % 7,372 313 5.67 % Investment securities - Taxable 81,941 526 0.86 % 71,820 663 1.23 % Investment securities - Non-taxable 20,396 569 3.73 % 15,787 430 3.64 % 1,688,499 57,753 4.57 % 1,296,922 46,400 4.78 % Total interest earning assets 2,290,121 59,624 3.48 % 1,626,313 48,643 4.00 % Loans held for sale 1,824 — Noninterest earning assets 122,306 91,454 Total assets $ 2,414,251 $ 1,717,767 Liabilities and shareholders’ equity Interest-bearing liabilities Interest-bearing deposits 1,350,795 4,223 0.42 % 936,765 5,408 0.77 % Borrowed funds 82,229 1,216 1.98 % 197,327 1,423 0.96 % Total interest-bearing liabilities 1,433,024 5,439 0.51 % 1,134,092 6,831 0.80 % Noninterest-bearing liabilities Noninterest-bearing deposits 742,530 386,848 Other noninterest-bearing liabilities 17,769 17,243 Shareholders’ equity 220,928 179,584 Total liabilities and shareholders’ equity $ 2,414,251 $ 1,717,767 2.97 % 3.20 % Net interest income $ 54,185 $ 41,812 3.16 % 3.43 % (1)Includes nonaccrual loans.(2)Net interest spread is the difference between interest earned on interest earning assets and interest paid on interest-bearing liabilities.(3)Net interest margin is a ratio of net interest income to average interest earning assets for the same period.(4)Interest income on loans includes loan fees of $4.4 million and $1.1 million for the six months ended June 30, 2021, and 2020, respectively.39For the Nine Months Ended September 30, 2021 Compared to 2020 Change Due To (Dollars in thousands) Volume Rate Total Interest income Interest-bearing deposits $ 825 $ (1,083) $ (258) Federal funds sold 76 (169) (93) Federal Reserve Bank stock, Federal Home Loan Bank stock and other corporate stock 11 (34) (23) Investment securities - taxable 93 (230) (137) Investment securities - tax exempt 126 13 139 Loans 14,009 (2,656) 11,353 Total $ 15,140 $ (4,159) $ 10,981 Interest expense Interest-bearing deposits 2,390 (3,575) (1,185) Borrowed funds (830) 623 (207) Total $ 1,560 $ (2,952) $ (1,392) $10.7$12.4 million to $35.1$41.8 million for the sixnine months ended JuneSeptember 30, 2021, compared to the sixnine months ended JuneSeptember 30, 2020. Our total net interest income was impacted by an increase in interest earning assets, primarily due to increases in annualized average interest rates primarily reflected an increase in interest earning assets, primarily due to increased balances in our low yielding cash assets as well as increases in our loan portfolio of lower yielding loans, offset by decreased cost of funds to the Company. Average total interest earning assets were $2.2$2.3 billion for the sixnine months ended JuneSeptember 30, 2021, compared with $1.4$1.6 billion for the sixnine months ended JuneSeptember 30, 2020. The annualized yield on those interest earning assets decreased 5752 basis points to 3.48% for the sixnine months ended JuneSeptember 30, 2021, due to loans repricing downward, coupled with higher yielding loan payoffs. The increase in the average balance of interest earning assets was driven primarily by the MBI Variance and growth in our loan portfolio of $525.4$391.6 million, or 45.4%30.2%, compared to the sixnine months ended JuneSeptember 30, 2020. The growth in the loan portfolio was due to organic loan originations and the Professional Bank PPP during the sixnine months ended JuneSeptember 30, 2021.$368.2$298.9 million, or 35.9%26.4%, for the sixnine months ended JuneSeptember 30, 2021. The increase was primarily due to a $413.9$414.0 million, or 47.1%44.2%, increase in the average balance of interest-bearing deposits. The increase in the average balance of interest-bearing deposits was primarily due to increases in NOW and money market accounts for the sixnine months ended JuneSeptember 30, 2021, compared to the sixnine months ended JuneSeptember 30, 2020, and, to a lesser extent, increases in certificates of deposits. The annualized average interest rate paid on average interest-bearing liabilities decreased to 0.53%0.51% for the sixnine months ended JuneSeptember 30, 2021, compared to 1.02%0.80% for the sixnine months ended JuneSeptember 30, 2020. Annualized average interest rate paid on interest-bearing deposits decreased 5435 basis points to 0.43%0.42%, and the annualized average interest rate paid on borrowed funds increased by 51102 basis points to 1.81%1.98%. Compared toFor the sixnine months ended June 30, 2020, the Company participated in the PPPLF which had a downward effect on our loan portfolio yields. For the six months ended JuneSeptember 30, 2021, our average other noninterest-bearing liabilities increased $2.5$0.5 million, or 15.7%3.1%, compared to the sixnine months ended JuneSeptember 30, 2020. Average noninterest-bearing deposits also increased $375.7$355.7 million, or 113.0%91.9%, compared to the sixnine months ended JuneSeptember 30, 2020. For the sixnine months ended JuneSeptember 30, 2021, our annual net interest margin was 3.20%3.16% and net interest spread was 3.00%2.97%. For the sixnine months ended JuneSeptember 30, 2020, annual net interest margin was 3.38%3.43% and net interest spread was 3.08%3.20%.$1.8$2.9 million for the sixnine months ended JuneSeptember 30, 2021, and $2.6$8.6 million for the sixnine months ended JuneSeptember 30, 2020. The decrease from 2020 to 2021 was madeattributed primarily due loan payoffsto the lowering of COVID related risk in higher risk categoriesthe portfolio taken in the prior year offset by an increase in loan originations.originations subject to the allowance requirements and having addressed the impairment of a loan to Coex in the third quarter of 2020. We recorded onea net charge-off related to one loan of $7.6 million for the sixnine months ended JuneSeptember 30, 2021. We did not record any2021, compared to a net charge-offscharge-off related to one loan of $0.3 million for the sixnine months ended JuneSeptember 30, 2020. Our allowance for loan losses as a percentage of total loans (excluding Professional Bank PPP loans) was 0.67% at 0.72% on JuneSeptember 30, 2021, compared to 1.10% at on December 31, 2020. See Reconciliation of non-GAAP Financial Measures.40fees,fee income, origination fees for SBA loans, and other fees and charges. Noninterest income does not include loan origination fees to the extent they exceed the direct loan origination costs, which are generally recognized over the life of the related loan as an adjustment to yield using the interest method.Nine Months Ended September 30, (Dollars in thousands) 2021 2020 Increase (Decrease) Noninterest income Service charges on deposit accounts $ 2,237 $ 848 163.8% Income from Bank owned life insurance 844 378 123.3% SBA origination fees 166 114 45.6% SWAP fee income 781 622 25.6% Third party loan sales 462 519 (11.0)% Gain on sale and call of securities 23 16 43.8% Other 384 290 32.4% Total noninterest income $ 4,897 $ 2,787 75.7% sixnine months ended JuneSeptember 30, 2021, was $3.4$4.9 million, a $1.6$2.1 million, or 87.6%75.7%, increase compared to for the sixnine months ended JuneSeptember 30, 2020. The increase was primarily due to growth in deposit transaction accounts, coupled with increases in service charges on deposit accounts with the Correspondent Banking Relationship, $0.3$0.5 million increase in income from BOLI, and $0.1$0.2 million increase in SWAP fees.JuneSeptember 30, 2021, entitled "Customer Derivatives – Interest Rate SWAPs" for additional information regarding our derivative financial instruments.Nine Months Ended September 30, (Dollars in thousands) 2021 2020 Increase (Decrease) Noninterest expense Salaries and employee benefits $ 21,233 $ 18,608 14.1% Occupancy and equipment 2,942 3,051 (3.6)% Data processing 869 971 (10.5)% Marketing 738 723 2.1% Professional fees 2,087 1,723 21.1% Acquisition expenses 684 3,301 (79.3)% Regulatory assessments 1,248 764 63.4% Other 4,565 3,606 26.6% Total noninterest expense $ 34,366 $ 32,747 4.9% $22.7$34.4 million for the sixnine months ended JuneSeptember 30, 2021, an increase of $1.7$1.6 million, or 8.1%4.9%, compared to for the sixnine months ended JuneSeptember 30, 2020. The increase was primarily due to increased salaries and investment in digital41137172 as of December 31, 2019,September 30, 2020, to 179205 as of JuneSeptember 30, 2020, which increase was due to the MBI acquisition, and further increased to 194 as of June 30, 2021.$2.8$4.5 million for the sixnine months ended JuneSeptember 30, 2021, compared to $0.7$0.5 million for the sixnine months ended JuneSeptember 30, 2020. Our effective tax rates for those periods were 20.4% and 28.8%16.4%, respectively. The change in the effective tax rate was due to thea decrease in nondeductible expenses, primarily acquisition related costs, an increase in tax-exempt income and an increasestate income tax credits in excess tax benefits from stock-based compensation.sixnine months ended JuneSeptember 30, 2021, our total assets increased 24.5%28.6%, or $0.5$0.6 billion, compared to December 31, 2020. Total loans increased 2.2%2.1%, or $36.8$34.4 million, compared to December 31, 2020, as a result of the third round of the PPP and new organic loan origination.origination, partially offset by loan payoffs. Interest-bearing deposits at other financial institutions increased due to our desire to maintain our excess liquidity in more liquid assets due to our continued robust demand for loans and cash associated with Correspondent Banking Relationship. Stockholders’ equity increased $7.5$12.5 million, or 3.5%5.8%, compared to December 31, 2020, primarily due to net income of $11.1$17.4 million for the sixnine months ended JuneSeptember 30, 2021, offset by repurchases of the Company’s Class A voting common stock.$435.4$527.2 million, or 200.7%243.0%, compared to December 31, 2020, primarily due to an increase in interest-bearing deposits. As we continue to grow, so do our liquidity needs.at Junewas $0 on September 30, 2021, and 2020, was $0 and $0, respectively.42$32.6$25.6 million, or 34.4%26.9%, to $127.7$120.6 million compared to December 31, 2020, primarily due to purchases of $33.0$50.9 million in securities available for sale, offset by paydowns, and maturities. To supplement interest income earned on the Company’s loan portfolio, the Company invests in high quality mortgage-backed securities, government agency bonds, corporate bonds, community development district bonds, and equity securities (including mutual funds).JuneSeptember 30, 2021, and December 31, 2020.43September 30, 2021 December 31, 2020 (Dollars in thousands) Book Value Fair Value Book Value Fair Value Securities Available for Sale - taxable Small Business Administration loan pools $ 40,131 $ 39,703 $ 30,678 $ 30,556 Mortgage-backed securities 51,105 50,927 28,514 28,922 United States agency obligations 2,002 2,079 3,000 3,122 Corporate bonds 1,500 1,509 2,501 2,510 Total $ 94,738 $ 94,218 $ 64,693 $ 65,110 Securities Available for Sale - tax exempt Community Development District bonds $ 17,800 $ 18,364 $ 20,582 $ 21,299 Municipals 1,054 1,098 1,064 1,099 Total $ 18,854 $ 19,462 $ 21,646 $ 22,398 Securities Held to Maturity Mortgage-backed securities $ 259 $ 269 $ 345 $ 359 United States Treasury — — 202 202 Foreign Bonds — — 1,000 1,000 Total $ 259 $ 269 $ 1,547 $ 1,561 Equity Securities Mutual Funds $ 5,903 $ 5,903 $ 6,005 $ 6,005 Other equity securities 800 800 — — Total $ 6,703 $ 6,703 $ 6,005 $ 6,005 One Year or Less More than One Year
Through Five YearsMore than Five Years
Through 10 YearsMore than 10 Years Total On September 30, 2021
(Dollars in thousands)Book Value Weighted
Average
YieldBook Value Weighted
Average
YieldBook Value Weighted
Average
YieldBook Value Weighted
Average
YieldBook Value Fair Value Weighted
Average
YieldSecurities Available for Sale - taxable Small Business Administration loan pools $ — — % $ 545 0.89 % $ 18,802 1.51 % $ 20,784 1.40 % $ 40,131 $ 39,703 1.45 % Mortgage-backed securities — — % 120 0.31 % 6,376 0.78 % 44,610 1.16 % 51,106 50,927 1.11 % United States agency obligations 999 2.54 % 1,003 2.66 % — — % — — % 2,002 2,079 2.60 % Corporate bonds — — % 1,500 1.17 % — — % — — % 1,500 1,509 1.17 % Total $ 999 2.54 % $ 3,168 1.56 % $ 25,178 1.32 % $ 65,394 1.24 % $ 94,739 $ 94,218 1.29 % Securities Available for Sale - tax exempt Community Development District bonds $ 190 4.52 % $ 17,295 4.92 % $ 315 3.75 % $ — — % $ 17,800 $ 18,364 4.90 % Municipals — — % 1,054 2.27 % — — % — — % 1,054 1,098 2.27 % Total $ 190 4.52 % $ 18,349 4.77 % $ 315 3.75 % $ — — % $ 18,854 $ 19,462 4.75 % Securities Held to Maturity Mortgage-backed securities — — % — — % — — % 259 2.56 % 259 269 2.56 % United States Treasury — — % — — % — — % — — % — — — % Foreign Bonds — — % — — % — — % — — % — — — % Total $ — — % $ — — % $ — — % $ 259 2.56 % $ 259 $ 269 2.56 % Equity Securities Mutual Funds 5,903 1.10 % — — % — — % — — % 5,903 5,903 1.10 % Other equity securities 800 — % — — % — — % — — % 800 800 — % Total $ 6,703 1.10 % $ — — % $ — — % $ — — % $ 6,703 $ 6,703 0.97 % JuneSeptember 30, 2021 and December 31, 2020.September 30, 2021 December 31, 2020 (Dollars in thousands) Amount Percent Amount Percent Loans held for investment: Commercial real estate $ 856,194 50.7% $ 777,025 46.9% Owner Occupied 315,489 —% 286,701 —% Non-Owner Occupied 540,705 —% 490,324 —% Residential real estate 371,469 22.0% 379,534 22.9% Commercial (Non-PPP) 288,177 17.1% 206,095 12.4% Commercial (PPP) 85,133 5.0% 185,748 11.2% Construction and land development 69,534 4.1% 99,590 6.0% Consumer and other 16,744 1.0% 9,689 0.6% Total loans held for investment, gross 1,687,251 100.0% 1,657,681 100.0% Allowance for loan loss (11,478) (16,259) Loans held for investment, net $ 1,675,773 $ 1,641,422 Loans held for sale: Loans held for sale $ 284 100.0% $ 1,270 100.0% Total loans held for sale $ 284 $ 1,270 collateralizedsupported by operating cash flows are also included in this category of loans. As of JuneSeptember 30, 2021, we had $305.9$315.5 million of owner-occupied commercial real estate loans and $569.6$540.7 million of investment commercial real estate loans, representing 34.9%36.8% and 65.1%63.2%, respectively, of our commercial real estate portfolio. As of JuneSeptember 30, 2021, the average loan balance of loans in our commercial real estate loan portfolio was approximately $1.2$1.3 million for owner-occupied and $1.8 million for non-owner occupied. Commercial real estate loan terms are generally extended for 10 years or less and amortize generally over 25 years or less. Terms of 15 years are permitted where the loan is fully amortized over the term of the loan. The maximum loan to value is generally, 80% of the market value or purchase price, but may be as high as 90% for SBA 504 owner-occupied loans. As of JuneSeptember 30, 2021, we did not have any commercial real estate loans with a loan to value over 100%. Our credit policy also usually requires a minimum debt service coverage ratio of 1.20x. As of JuneSeptember 30, 2021, our weighted-average loan-to-value ratios for owner-occupied and non-owner-occupied commercial real estate were 48.5% and 50.0%, respectivelyboth at 49.3% and debt service coverage ratios were 2.37x2.48x and 1.78x,1.99x, respectively. The interest rates on our commercial real estate loans have initial fixed rate terms that adjust typically at five years, and we routinely charge an origination fee for our services. We generally require personal guarantees from the principal owners of the business, supported by a review of the principal owners’ personal financial statements and global debt service obligations. All commercial real estate loans with an outstanding balance of $1.0 million or more are reviewed at least annually. The properties securing the portfolio are located primarily throughout our market and are generally diverse in terms of type. This diversity helps reduce the exposure to adverse economic events that affect any single industry.44As of September 30, 2021 As of December 31, 2020 (Dollars in thousands) Amount Percent Amount Percent Commercial Real Estate Auto (Car Lot/Auto Repair) $ 27,600 3.2% $ 22,424 2.9% Educational Facility 32,625 3.8% 14,313 1.8% Gas Station 68,856 8.0% 64,142 8.3% Hotel 59,679 7.0% 54,244 7.0% Mixed Use 32,411 3.8% 29,941 3.9% Multifamily 123,879 14.5% 98,738 12.7% Office 104,539 12.2% 111,735 14.4% Other / Special Use 52,530 6.1% 41,668 5.4% Religious Facility 10,802 1.3% 8,434 1.1% Retail 212,162 24.8% 191,990 24.7% Vacant Land 6,080 0.7% 7,849 1.0% Warehouse 125,031 14.6% 131,547 16.8% Total $ 856,194 100.0% $ 777,025 100.0% As of September 30, 2021 As of December 31, 2020 (Dollars in thousands) Amount Percent Amount Percent Commercial Real Estate Broward $ 124,367 14.5% $ 118,353 15.2% Miami-Dade 535,100 62.5% 500,690 64.4% Palm Beach 141,270 16.5% 113,249 14.6% Other FL County 31,707 3.7% 27,124 3.5% Out of State 23,750 2.8% 17,609 2.3% Total $ 856,194 100.0% $ 777,025 100.0% JuneSeptember 30, 2021, non-owner occupied commercial real estate loans of $569.6$540.7 million represented 36.7%33.8% of total risk-weighted assets.JuneSeptember 30, 2021, our weighted average loan-to-value ratio on our construction, vacant land, and land development loans were 55.9%51.3%, 48.7%49.7% and 51.0%49.8%, respectively. We require construction and development loans to establish an interest reserve account, which is sufficient to pay the loan through completion of the project. We conduct semi-annual stress testing of our construction loan portfolio and closely monitor underlying real estate conditions as well as our borrowers’ trends of sales valuations as compared to underwriting valuations as part of our ongoing risk management efforts. We also closely monitor our borrowers’ progress in construction buildout and strictly enforce our original underwriting guidelines for construction milestones and completion timelines.45As of September 30, 2021 As of December 31, 2020 (Dollars in thousands) Amount Percent Amount Percent Construction & Development 1 – 4 Family Construction $ 43,046 61.9 % $ 44,971 45.1 % Commercial Construction 669 1.0 % 34,031 34.2 % Land Development 5,343 7.7 % 5,783 5.8 % Vacant Land 20,476 29.4 % 14,805 14.9 % Total $ 69,534 100.0 % $ 99,590 100.0 % As of September 30, 2021 As of December 31, 2020 (Dollars in thousands) Amount Percent Amount Percent Construction & Development Broward $ 2,537 3.6% $ 21,722 21.8% Miami-Dade 57,274 82.4% 57,008 57.3% Palm Beach 9,723 14.0% 15,048 15.1% Other FL County — —% 5,812 5.8% Total $ 69,534 100.0% $ 99,590 100.0% JuneSeptember 30, 2021, total construction and land development loans of $74.2$69.5 million represented 4.8%7.7% of total risk-weighted assets.20%15.7% of our residential loan portfolio. Our residential loans also include home equity lines of credit, which totaled approximately $52.8$46.0 million, or approximately 14.6%12.4% of our residential loan portfolio as of JuneSeptember 30, 2021. The average loan balance of closed-end residential loans in our residential portfolio was approximately $0.8 million as of JuneSeptember 30, 2021.2021. As of JuneSeptember 30, 2021, we did not have any residential real estate loans with a loan to value over 100%. Given the tragedy at the Champlain Towers Condominium in Surfside, Florida, there is increased interest in condominium development and lending. While the Company does not target high-rise, beachfront, condominium lending, we do, from time-to-time, grant loans secured by individual condominium units. At June 30, 2021, we had 11 loans, with outstanding balances of $4.0 million, secured by individual condominium units located in Florida buildings, over ten stories, which were originally constructed 40 or more years ago. Our one-to-four family residential loans have a relatively small balance spread between many individual borrowers compared to our other loan categories. Our owner-occupied residential real estate loans usually have fixed rates for five or seven years and adjust on an annual basis after the initial term based on a typical maturity of 30 years. Upon the implementation of rules under the Dodd-Frank Wall Street Reform and Consumer Protection Act, the origination, closing and servicing of the traditional residential loan products became much more complex, which led to increased cost of compliance and training. As a result, many banks exited the business, which created an opportunity for the banks that remained in the space. While the use of technology, and other related origination strategies have allowed non-bank originators to gain significant market share over the last several years, traditional banks that made investments in personnel and technology to comply with the new requirements have typically experienced loan growth. Unlike many of our competitors, we have been able to effectively compete in the residential loan market, while simultaneously doing the same in the commercial loan market which has enabled us to establish a broader and deeper relationship with our borrowers. Additionally, by offering a full line of residential loan products, the owners of the many small to medium sized businesses that we lend to use us, instead of a competitor, for financing a personal residence. This greater bandwidth to the same market has been a significant contributor to our growth and market share in South Florida. The following table shows our residential real estate portfolio by loan type and the weighted average loan-to-value ratio for each loan type.As of September 30, 2021 As of December 31, 2020 (Dollars in thousands) Amount Percent LTV (%) Amount Percent LTV (%) Residential Real Estate Owner Occupied $ 266,966 71.8 % 57.3 % $ 270,934 71.2 % 57.8 % Investor Owned Residences 58,475 15.7 % 51.7 % 48,087 12.6 % 50.7 % HELOC 46,028 12.4 % 50.9 % 60,513 15.9 % 57.1 % Loans Held for Sale 284 0.1 % — % 1,270 0.3 % — % Total $ 371,753 100.0 % $ 380,804 100.0 % Table of Contentsnon-Professional Bank PPP loans in our commercial loan portfolio, excluding Professional Bank PPP loans was $0.5$0.6 million as of JuneSeptember 30, 2021.2021. As of JuneSeptember 30, 2021, non-Professional Bank PPP commercial loans was $229.2$288.2 million, and Professional Bank PPP commercial loans was $144.1$85.1 million. For commercial loans over $0.5 million, a global cash flow analysis is generally required, which forms the basis for the credit approval, “Global cash flow” is defined as a cash flow calculation which includes all income sources of all principals in the transaction as well as all debt payments, including the debt service associated with the proposed transaction. In general, a minimum 1.20x debt service coverage is preferred, but in no event may the debt service coverage ratio be less than 1.00x. As of JuneSeptember 30, 2021,, the debt service coverage ratio for our Bank commercial loan portfolio was approximately 2.50x2.43x for non-Professional Bank PPP loans, excluding approximately 3.8%3.3% of the commercial loan portfolio that is cash secured. Most commercial business loans, which includeexclude Professional Bank PPP loans, are secured by a lien on general business assets including, among other things, available real estate,46JuneSeptember 30, 20212021..As of September 30, 2021 As of December 31, 2020 (Dollars in thousands) Amount Percent Amount Percent Commercial Loans Business Products $ 58 —% $ 1,163 0.6% Business Services 65,441 22.7% 29,461 14.3% Communication 17,548 6.1% 17,687 8.6% Construction 31,198 10.8% 19,241 9.3% Finance 84,752 29.5% 56,506 27.3% Healthcare 11,179 3.9% 7,369 3.6% Services 36,121 12.5% 23,252 11.3% Technology 760 0.3% 850 0.4% Trade 32,557 11.3% 44,233 21.5% Transportation 1,217 0.4% 2,926 1.4% Other 7,346 2.5% 3,407 1.7% Total $ 288,177 100.0% $ 206,095 100.0% 47Second$39.1$3.3 million, or 2.2%0.2%, from the prior quarter primarily due to a reduction inProfessional Bank PPP loans.loan forgiveness and loan payoffs during the quarter. Loan growth, net of Professional Bank PPP loans, was up $27.6$50.9 million, or 1.8%3.3% quarter-over-quarter. We experienced strong originations across all loan types due to new loan originations of $186.8$198.7 million ($169.2(of which $172.7 million of conventional loans, of which $118.0 million funded, coupled with48$17.6 million of PPP loans)funded), partially offset by payoffs of $162.2$157.1 million ($77.9101.2 million of conventional loans and $84.3$55.9 million of Professional Bank PPP loans forgiven).at on JuneSeptember 30, 2021.49September 30, 2021 (Dollars in thousands) Due in One
Year or LessDue in One to
Five YearsDue After
Five YearsTotal Commercial Real Estate $ 80,898 $ 224,943 $ 550,353 $ 856,194 Residential Real Estate 12,592 20,362 338,515 371,469 Commercial* 96,387 150,537 126,386 373,310 Construction and Development 27,868 14,542 27,124 69,534 Consumer and Other 3,770 7,270 5,704 16,744 Total loans $ 221,515 $ 417,654 $ 1,048,082 $ 1,687,251 Amounts with fixed rates $ 108,887 $ 347,399 $ 1,012,608 $ 1,468,894 Amounts with floating rates $ 112,628 $ 70,255 $ 35,474 $ 218,357 December 31, 2020 (Dollars in thousands) Due in One
Year or LessDue in One to
Five YearsDue After
Five YearsTotal Commercial Real Estate $ 63,256 $ 221,157 $ 492,612 $ 777,025 Residential Real Estate 16,377 23,862 339,295 379,534 Commercial* 93,184 228,115 70,544 391,843 Construction and Development 37,160 30,131 32,299 99,590 Consumer and Other 3,626 3,850 2,213 9,689 Total loans $ 213,603 $ 507,115 $ 936,963 $ 1,657,681 Amounts with fixed rates $ 108,016 $ 469,399 $ 908,158 $ 1,485,573 Amounts with floating rates $ 105,587 $ 37,716 $ 28,805 $ 172,108 During the three months ended June 30, 2021, we funded 172 loans representing $17.6 million under Round 3 of the PPP. As of June 30, 2021, we1,3621,745 loans totaling $196.9$251.4 million were forgiven by the SBA. Most of the Professional Bank PPP loans were initially pledged to the Federal Reserve as part of the PPPLF. The PPPLF pledged loans are non-recourse to the Company. However, wethe Company paid off all of the PPPLF advances during the first and second quarter of 2021 and the balance of PPPLF advances made by the Company was $0 ason September 30, 2021.JuneSeptember 30, 2021.$2.8$2.8 million as of JuneSeptember 30, 2021, or 0.11%0.10% of total assets. We had nonperforming assets of $10.4 million as of December 31, 2020, or 0.51% of total assets. The decrease in nonperforming assets was primarily driven by the $7.6 million charge off of the Coex Coffee International, Inc. ("Coex") loan during the first quarter of 2021. Occasionally, loans that we make will be impacted due to the occurrence of unforeseen events, which was a primary50(Dollars in thousands) September 30, 2021 December 31, 2020 Nonaccrual Loans Commercial real estate $ — $ — Residential real estate — — Commercial 1,468 9,127 Construction and development — — Consumer and other loans 1,307 1,307 Accruing loans 90 or more days past due — — Total nonperforming loans $ 2,775 $ 10,434 Other real estate owned — — Total nonperforming assets $ 2,775 $ 10,434 Restructured loans-nonaccrual $ — $ — Restructured loans-accruing $ 227 $ 298 Ratio of nonperforming loans to total loans 0.16% 0.62% Ratio of nonperforming assets to total assets 0.10% 0.51% 51(Dollars in thousands) Pass Special
MentionSubstandard Doubtful Total September 30, 2021 Commercial real estate $ 853,888 $ — $ 2,306 $ — $ 856,194 Residential real estate 371,469 — — — 371,469 Commercial (Non-PPP) 286,334 375 1,468 — 288,177 Commercial (PPP) 85,133 — — — 85,133 Construction and land development 69,534 — — — 69,534 Consumer 15,349 88 1,307 — 16,744 Total $ 1,681,707 $ 463 $ 5,081 $ — $ 1,687,251 December 31, 2020 Commercial real estate $ 774,674 $ — $ 2,351 $ — $ 777,025 Residential real estate 379,104 430 — — 379,534 Commercial (Non-PPP) 196,856 112 9,127 — 206,095 Commercial (PPP) 185,748 — — — 185,748 Construction and land development 99,590 — — — 99,590 Consumer 8,382 — 1,307 — 9,689 Total $ 1,644,354 $ 542 $ 12,785 $ — $ 1,657,681 52sixnine months ended JuneSeptember 30, 2021, and 2020.For the Nine Months Ended September 30, For the Year Ended December 31, (Dollars in thousands) 2021 2020 2020 2019 Balance at beginning of period $ 16,259 $ 6,548 $ 6,548 $ 5,685 Charge-offs Commercial real estate — — — — Residential real estate — (179) (207) — Commercial (7,641) (99) (99) — Construction and development — — — — Consumer and other — — — — Total Charge-offs (7,641) (278) (306) — Recoveries Commercial real estate — — — — Residential real estate — — — — Commercial — — — — Construction and development — — — — Consumer and other — — — 1 Total recoveries — — — 1 Net charge-offs (7,641) (278) (306) — Provision for loan losses 2,860 8,765 10,017 862 Balance at end of period $ 11,478 $ 15,035 $ 16,259 $ 6,548 ALLL as a percentage of total loans at end of period 0.68 % 0.95 % 0.99 % 0.83 % ALLL as a percentage of loans (excluding PPP loans) at end of period 0.72 % 1.09 % 1.10 % 0.83 % ALLL as a multiple of net charge-offs 1.5 54.1 53.1 N/A ALLL as a percentage of nonperforming loans 413.6 % 151.6 % 155.8 % 287.2 % $10.4$11.5 million at June on September 30, 2021, compared to $16.3$16.3 million at on December 31, 2020, a decrease of 35.9%29.4%. The decrease was primarily due to the macro environment stabilization following the increased reserves at the early stages of COVID-19 pandemic in 2020 and having addressed the impairment of Coex in the third quarter of 2020. A reasonable balance was maintained in response to economic weakening and the onset of COVID variants. At On JuneSeptember 30, 2021, our allowance for loan losses was 0.67%0.72% of total gross loans (excluding Professional Bank PPP loans) and provided coverage of 375.4%413.6% of our nonperforming loans, compared to an allowance for loan losses to total gross loans (net of overdrafts) ratio of 1.10% as of December 31, 2020. See Reconciliation of non-GAAP Financial Measures. We believe our allowance at on JuneSeptember 30, 2021, was adequate to absorb probable incurred losses inherent in our loan portfolio. The following table provides an allocation of the allowance for loan losses to specific loan types as of JuneSeptember 30, 2021, and December 31, 2020.September 30, 2021 December 31, 2020 (Dollars in thousands) Allowance Percent Allowance Percent Commercial real estate $ 4,079 35.5% $ 3,159 19.5% Residential real estate 2,222 19.4% 2,177 13.4% Commercial 4,097 35.7% 10,462 64.3% Construction and development 333 2.9% 388 2.4% Consumer and other 747 6.5% 73 0.4% Total allowance for loan losses $ 11,478 100.0% $ 16,259 100.0% On At JuneSeptember 30, 2021, the recorded investment in impaired loans (consisting of nonaccrual loans, troubled debt restructured loans, loans past due 90 days or more and still accruing interest and other loans based on management’ judgment) was $5.4$3.0 million, of which $2.8 million required a specific reserve of $0.7$1.3 million, compared to a recorded investment in impaired loans of $13.1 million, of which $10.4 million required a specific reserve of $8.3 million aton December 31, 2020. At . On JuneSeptember 30, 2021, we had two loans amounting to $0.3$0.2 million that were considered to be TDRs, compared to the same two loans amounting to $0.3 million aton December 31, 2020. We did not allocate any specific reserves to loans that have been modified as TDRs as of JuneSeptember 30, 2021, and December 31, 2020.53Deposits$93.6$77.8 million and $98.2$98.2 million at June, on September 30, 2021, and December 31, 2020, respectively. Additionally, we supplement our deposits with wholesale funding sources such as Quickrate, brokered deposits. However, we do not significantly rely on wholesale funding sources, which are generally viewed as less stable compared to core deposits due to the relatively higher price elasticity of demand for deposits from wholesale sources. As of JuneSeptember 30, 2021, and December 31, 2020,, these wholesale deposits represented 2.5%3.8% and 4.3%, respectively, of our total deposits.$238.5$371.4 million, or 20.1%36.50%, from December 31, 2020, to JuneSeptember 30, 2021, primarily due to a $131.2$194.6 million increase in money market account balances from organic growth. In order to fund our loan growth, all of our bankers are actively involved with our strategic efforts and are incentivized to grow core deposits. The average rate paid on interest-bearing deposits decreased 5435 basis points to for the sixnine months ended JuneSeptember 30, 2021.2021, compared to the nine months ended September 30, 2020. The decrease in average rates paid on interest-bearing deposits was a result of a continued decrease in marketinterest rates of interest during the sixnine months ended JuneSeptember 30, 2021. As of JuneSeptember 30, 2021,, we had approximately $56.5$56.4 million in brokered deposits representing 2.5%2.4% of total deposits. Brokered deposits increased approximately $26.4$26.3 million, or 87.6%87.2%, compared to December 31, 2020.2020. We did not obtain these brokered deposits through a deposit listing agency, but rather through an existing relationship with the Bank. However, these deposits meet the regulatory definition of brokered deposits and are reported accordingly.For the Nine Months Ended September 30, 2021 For the Year Ended
December 31, 2020(Dollars in thousands) Average
BalanceAverage Rate Average
BalanceAverage Rate NOW accounts $ 273,590 0.20% $ 167,991 0.26% Money market accounts 780,825 0.40% 586,240 0.65% Brokered deposits 36,555 0.56% 11,339 0.90% Savings accounts 11,358 0.10% 7,564 0.13% Certificates of deposit 248,467 0.71% 216,467 1.13% Total interest-bearing deposits 1,350,795 0.42% 989,601 0.97% Noninterest-bearing deposits 742,530 —% 410,357 —% Total deposits $ 2,093,325 0.27% $ 1,399,958 0.48% (1)Balance Sheet does not illustrate brokered deposits as presented above .For the Nine Months Ended September 30, 2021 For the Year Ended
December 31, 2020(Dollars in thousands) Ending
Balance% of Total Ending
Balance% of Total NOW accounts $ 328,667 14.0 % $ 232,367 14.0 % Money market accounts 893,441 37.9 % 679,761 41.0 % Brokered deposits 56,418 2.4 % 30,137 1.8 % Savings accounts 13,833 0.6 % 9,727 0.6 % Certificates of deposit 262,998 11.2 % 231,953 14.0 % Total interest-bearing deposits 1,555,357 66.1 % 1,183,945 71.3 % Noninterest-bearing deposits 799,389 33.9 % 475,598 28.7 % $ 2,354,746 100.0 % $ 1,659,543 100.0 % (1)Balance Sheet does not illustrate brokered deposits as presented above.54The following table presentsFor more information regarding the maturities of our certificates of deposittime deposits including time deposits that meet or exceed the $250,000 FDIC insurance limit as of JuneSeptember 30, 2021,.The following table presents the maturities of our certificates of deposit as of and December 31, 2020,.JuneSeptember 30, 2021, entitled "Debt" for additional information regarding our Subordinated Debt and Valley National Line of Credit.JuneSeptember 30, 2021,, approximately $209.9$238.7 million in total loans that were pledged as collateral for our FHLB borrowings. We utilize these borrowings to meet liquidity needs and to fund certain fixed rate loans in our portfolio. As of JuneSeptember 30, 2021,, we had $35.0 million in outstanding advances and $134.7$129.3 million in additional(Dollars in thousands) Nine Months Ended September 30, 2021 Year Ended December 31, 2020 Amount outstanding at period-end $ 35,000 $ 40,000 Weighted average interest rate at period-end 2.04% 1.96% Maximum month-end balance during period $ 40,000 $ 70,000 Average balance outstanding during period $ 38,867 $ 58,210 Weighted average interest rate during period 1.98% 1.63% JuneSeptember 30, 20212021..approximately $101.4 million inall PPPLF advances for a balance of $0 at Juneon September 30, 2021.55$7.5$12.5 million, or 3.5%5.8%, to $223.0$228.0 million aton JuneSeptember 30, 2021, compared to December 31, 2020, primarily due to net income of $11.1$17.4 million for the sixnine months ended JuneSeptember 30, 2021, offset by repurchases of the Company’s Class A voting common stock.150%1,250%. We are also required to maintain capital at a minimum level based on quarterly average assets, which is known as the leverage ratio.JuneSeptember 30, 2021, we were in compliance with all applicable regulatory capital requirements to which we were subject, and the Bank was classified as “well capitalized” for purposes of the prompt corrective action regulations. As we deploy our capital and continue to grow our operations, our regulatory capital levels may decrease depending on our level of earnings. However, we intend to monitor and control our growth in order to remain in compliance with all regulatory capital standards applicable to us. Based on changes to the Federal Reserve’s definition of a “Small Bank Holding Company” that increased the threshold to $3 billion in assets in August 2018, the Company is not currently subject to separate minimum capital measurements. At such time as the Company reaches the $3 billion asset level, it will again be subject to capital measurements independent of the Bank. For comparison purposes, the Company’s ratios are included in following discussion as well, all of which would have exceeded the “well-capitalized” level had the Company been subject to separate capital minimums.During the quarter, the Company infused $15.0 million of capital into the Bank in order to support asset growth and maintain well capitalized ratios at the Bank.56JuneSeptember 30, 2021, and December 31, 2020. The amounts presented exclude the capital conservation buffer.Actual Minimum for capital adequacy Minimum to be well
capitalized(Dollars in thousands) Amount Ratio Amount Ratio Amount Ratio September 30, 2021 Total capital ratio Bank $ 206,776 12.9% $ 127,860 8.0% $ 159,824 10.0% Company 224,537 14.0% 127,860 8.0% N/A N/A Tier 1 capital ratio Bank 194,377 12.2% 95,895 6.0% 127,860 8.0% Company 202,122 12.6% 95,895 6.0% N/A N/A Tier1 leverage ratio Bank 194,377 7.7% 101,353 4.0% 126,691 5.0% Company 202,122 8.0% 101,353 4.0% N/A N/A Common equity tier 1 capital ratio Bank 194,377 12.2% 71,921 4.5% 103,886 6.5% Company 202,122 12.6% 71,921 4.5% N/A N/A Actual Minimum for capital adequacy Minimum to be well
capitalized(Dollars in thousands) Amount Ratio Amount Ratio Amount Ratio December 31, 2020 Total capital ratio Bank $ 176,633 12.0% $ 117,298 8.0% $ 146,623 10.0% Company 215,977 14.7% 117,298 8.0% N/A N/A Tier 1 capital ratio Bank 159,448 10.9% 87,974 6.0% 117,298 8.0% Company 188,639 12.9% 87,974 6.0% N/A N/A Tier1 leverage ratio Bank 159,448 8.4% 75,723 4.0% 94,654 5.0% Company 188,639 10.0% 75,723 4.0% N/A N/A Common equity tier 1 capital ratio Bank 159,448 10.9% 65,980 4.5% 95,305 6.5% Company 188,639 12.9% 65,980 4.5% N/A N/A At , we had the ability to generate approximately $370.9$390.0 million in additional liquidity through all of our available resources beyond our overnight funds sold position. In addition to the primary borrowing outlets mentioned above, we also have the ability to generate liquidity by borrowing from the Federal Reserve Discount Window and through brokered deposits. We recognize the importance of maintaining liquidity and have developed a Contingent Liquidity Plan, which addresses various liquidity stress levels and our response and action based on the level of severity. We periodically test our credit facilities for access to the funds, but also understand that as the severity of the liquidity level increases, certain credit facilities may no longer be available. We conduct quarterly liquidity stress tests and the results are reported to our Asset-Liability Management Committee and our Board. We believe the liquidity available to us is currently sufficient to meet our ongoing needs.57At JuneOn September 30, 2021, and December 31, 2020, there were $209.9$238.7 million and $227.8$264.2 million in total loans pledged to the FHLB for liquidity. Our investment portfolio primarily consists of debt issued by the federal government and governmental agencies. The weighted-average maturity of our investment portfolio was 3.703.43 years and 3.02 years at Juneon September 30, 2021, and December 31, 2020, respectively, and had a net unrealized pre-tax gain of $0.4$0.1 million and $1.2 million, respectively, in our available for sale securities portfolio as of those dates.JuneSeptember 30, 2021, cash held at the holding company was approximately $20.2$16.7 million. Our average net overnight funds sold position (defined as funds sold plus interest-bearing deposits with other banks less funds purchased) was $56.9$50.0 million during 2021 compared to an average net overnight funds sold position of $39.6 million for the year ended December 31, 2020. This quarterOur liquidity is supported by our continued organic growth coupled with the Correspondent Banking Relationship buttressedand our preference for excess liquidity inis comprised of readily available assets, such as federal funds sold and cash at other depository institutions, as opposed to less liquid, but higher yielding, assets, like investment securities.secondthird quarter of 2021 as bottlenecked supply chains and other economic factors caused temporary increases in prices of commodities and consumer goods.JuneSeptember 30, 2021.(Dollars in thousands) Due in One
Year or LessDue after One
Through Three
YearsDue After
Three
Through
Five YearsDue After
Five YearsTotal FHLB advances $ — $ 20,000 $ 10,000 $ 5,000 $ 35,000 Time deposits of $250,000 or less 88,844 6,444 — — 95,288 Time deposits of more than $250,000 167,505 4,831 — — 172,336 Operating leases 1,443 2,638 1,863 620 6,564 Subordinated debt — — — 10,016 10,016 Total $ 257,792 $ 33,913 $ 11,863 $ 15,636 $ 319,204 58(Dollars in thousands) September 30, 2021 December 31, 2020 Unfunded lines of credit $ 368,117 $ 356,955 Commitments to extend credit 97,251 40,629 Letters of credit 11,308 13,036 Total credit extension commitments $ 476,676 $ 410,620 sixnine months ended JuneSeptember 30, 2021, and for the year ended December 31, 2020.Nine Months Ended September 30, 2021 Year Ended December 31, 2020 Return on Average Assets 0.96 % 0.46 % Return on Average Equity 10.53 % 4.30 % Average Equity to Average Assets 9.15 % 10.64 % 59+100, +100, +200, +300 and +400 basis points (bps)), at least once per quarter, and report the analysis to ALCO and our Board. We augment our interest rate shock analysis with alternative interest rate scenarios on a quarterly basis that may include ramps, parallel shifts, and a flattening or steepening of the yield curve (non-parallel shift). In addition, more frequent forecasts may be produced when interest rates are particularly uncertain or when other business conditions so dictate.60September 30, 2021
(Dollars in thousands)Within One
MonthAfter One
Month
Through Three
MonthsAfter Three
Months
Through
12 MonthsWithin One
YearGreater than
One Year
or NonsensitiveTotal Assets Interest earning assets Loans $ 417,201 $ 70,690 $ 258,411 $ 746,302 $ 929,471 $ 1,675,773 Loans held for sale 284 — — 284 — $ 284 Securities 49,733 3,229 7,889 60,851 59,791 120,642 Interest-bearing deposits at other financial institutions 680,333 — — 680,333 40,074 720,407 Federal funds sold 23,736 — — 23,736 — 23,736 FHLB & FRB stock 7,757 — — 7,757 — 7,757 Total interest earning assets $ 1,179,044 $ 73,919 $ 266,300 $ 1,519,263 $ 1,029,336 $ 2,548,599 Liabilities Interest-bearing liabilities Interest-bearing deposits $ 727,470 $ 20,900 $ 94,052 $ 842,422 $ 445,311 $ 1,287,733 Time deposits 13,104 25,557 217,688 256,349 11,275 267,624 Total interest-bearing deposits 740,574 46,457 311,740 1,098,771 456,586 1,555,357 Securities sold under agreements to repurchase — — — — — — FHLB advances — — — — 35,000 35,000 Subordinated debt — — — — 10,016 10,016 Total interest-bearing liabilities $ 740,574 $ 46,457 $ 311,740 $ 1,098,771 $ 501,602 $ 1,600,373 Period gap $ 438,470 $ 27,462 $ (45,440) $ 420,492 $ 527,734 Cumulative gap $ 438,470 $ 465,932 $ 420,492 $ 420,492 $ 948,226 Ratio of cumulative gap to total earning assets 37.19 % 630.33 % 157.90 % 27.68 % 92.12 % Ratio of cumulative gap to cumulative total earning assets 17.20 % 18.28 % 16.50 % 16.50 % 37.21 %
| | | | | | | | | | | | | | | | | | |
| | | | | After One | | After Three | | | | | | | | | | ||
| | | | | Month | | Months | | | | | Greater than | | | | |||
June 30, 2021 | | Within One | | Through Three | | Through | | Within One | | One Year | | | ||||||
(Dollars in thousands) |
| Month |
| Months |
| 12 Months |
| Year |
| or Nonsensitive |
| Total | ||||||
Assets |
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Interest earning assets |
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Loans | | $ | 414,242 | | $ | 112,022 | | $ | 345,668 | | $ | 871,932 | | $ | 808,236 | | $ | 1,680,168 |
Loans held for sale | | | 2,039 | | | — | | | — | | | 2,039 | | | — | | | 2,039 |
Securities | |
| 11,617 | |
| 7,010 | |
| 46,396 | |
| 65,023 | |
| 62,700 | |
| 127,723 |
Interest-bearing deposits at other financial institutions | |
| 616,180 | |
| — | |
| — | |
| 616,180 | |
| — | |
| 616,180 |
Federal funds sold | | | 36,156 | | | — | | | — | | | 36,156 | | | — | | | 36,156 |
FHLB & FRB stock | |
| 7,295 | |
| — | |
| — | |
| 7,295 | |
| — | |
| 7,295 |
Total interest earning assets | | $ | 1,087,529 | | $ | 119,032 | | $ | 392,064 | | $ | 1,598,625 | | $ | 870,936 | | $ | 2,469,561 |
Liabilities | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Interest-bearing liabilities | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Interest-bearing deposits | | $ | 652,409 | | $ | 18,476 | | $ | 83,136 | | $ | 754,021 | | $ | 406,789 | | $ | 1,160,810 |
Time deposits | |
| 15,533 | |
| 23,620 | |
| 165,683 | |
| 204,836 | |
| 56,844 | |
| 261,680 |
Total interest-bearing deposits | |
| 667,942 | |
| 42,096 | |
| 248,819 | |
| 958,857 | |
| 463,633 | |
| 1,422,490 |
Securities sold under agreements to repurchase | |
| — | |
| — | |
| — | |
| — | |
| — | |
| — |
FHLB advances | |
| — | |
| — | |
| — | |
| — | |
| 35,000 | |
| 35,000 |
Subordinated debt | |
| — | |
| — | |
| — | |
| — | |
| 10,062 | |
| 10,062 |
Total interest-bearing liabilities | | $ | 667,942 | | $ | 42,096 | | $ | 248,819 | | $ | 958,857 | | $ | 508,695 | | $ | 1,467,552 |
Period gap | | $ | 419,587 | | $ | 76,936 | | $ | 143,245 | | $ | 639,768 | | $ | 362,241 | |
|
|
Cumulative gap | | $ | 419,587 | | $ | 496,523 | | $ | 639,768 | | $ | 639,768 | | $ | 1,002,009 | |
|
|
Ratio of cumulative gap to total earning assets | |
| 38.58 | % |
| 417.13 | % |
| 163.18 | % |
| 40.02 | % |
| 115.05 | % |
|
|
Ratio of cumulative gap to cumulative total earning assets | |
| 16.99 | % |
| 20.11 | % |
| 25.91 | % |
| 25.91 | % |
| 40.57 | % |
|
|
61
CASH FLOW GAP
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| After One |
| After Three |
| | |
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| | | | | Month | | Months | | | | | Greater than | |
| | |||
June 30, 2021 | | Within One | | Through Three | | Through | | Within One | | One Year | |
| | |||||
(Dollars in thousands) | | Month | | Months | | 12 Months | | Year | | or Nonsensitive | | Total | ||||||
Assets |
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Interest earning assets |
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Loans | | $ | 127,533 | | $ | 129,493 | | $ | 342,715 | | $ | 599,741 | | $ | 1,080,427 | | $ | 1,680,168 |
Loans held for sale | | | 2,039 | | | — | | | — | | | 2,039 | | | — | | | 2,039 |
Securities | |
| 7,384 | |
| 2,498 | |
| 10,898 | |
| 20,780 | |
| 106,943 | |
| 127,723 |
Interest-bearing deposits at other financial institutions | |
| 616,180 | |
| — | |
| — | |
| 616,180 | | | — | |
| 616,180 |
Federal funds sold | | | 36,156 | | | — | | | — | | | 36,156 | | | — | | | 36,156 |
FHLB & FRB stock | |
| — | |
| — | |
| — | |
| — | |
| 7,295 | |
| 7,295 |
Total interest earning assets | | $ | 789,292 | | $ | 131,991 | | $ | 353,613 | | $ | 1,274,896 | | $ | 1,194,665 | | $ | 2,469,561 |
Liabilities | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Interest-bearing liabilities | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Interest-bearing deposits | | $ | 22,144 | | $ | 44,288 | | $ | 199,303 | | $ | 265,735 | | $ | 895,075 | | $ | 1,160,810 |
Time deposits | |
| 15,533 | |
| 23,620 | |
| 165,683 | |
| 204,836 | |
| 56,844 | |
| 261,680 |
Total interest-bearing deposits | |
| 37,677 | |
| 67,908 | |
| 364,986 | |
| 470,571 | |
| 951,919 | |
| 1,422,490 |
Securities sold under agreements to repurchase | |
| — | |
| — | |
| — | |
| — | |
| — | |
| — |
FHLB advances | |
| — | |
| — | |
| — | |
| — | |
| 35,000 | |
| 35,000 |
Subordinated debt | |
| — | |
| — | |
| — | |
| — | |
| 10,062 | |
| 10,062 |
Total interest-bearing liabilities | | $ | 37,677 | | $ | 67,908 | | $ | 364,986 | | $ | 470,571 | | $ | 996,981 | | $ | 1,467,552 |
Period gap | | $ | 751,615 | | $ | 64,083 | | $ | (11,373) | | $ | 804,325 | | $ | 197,684 | |
| |
Cumulative gap | | $ | 751,615 | | $ | 815,698 | | $ | 804,325 | | $ | 804,325 | | $ | 1,002,009 | |
| |
Ratio of cumulative gap to total earning assets | |
| 95.23 | % |
| 618.00 | % |
| 227.46 | % |
| 63.09 | % |
| 83.87 | % |
| |
September 30, 2021 (Dollars in thousands) | Within One Month | After One Month Through Three Months | After Three Months Through 12 Months | Within One Year | Greater than One Year or Nonsensitive | Total | ||||||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||||||||
Interest earning assets | ||||||||||||||||||||||||||||||||||||||
Loans | $ | 103,535 | $ | 85,298 | $ | 277,619 | $ | 466,452 | $ | 1,209,321 | $ | 1,675,773 | ||||||||||||||||||||||||||
Loans held for sale | 284 | — | — | 284 | — | 284 | ||||||||||||||||||||||||||||||||
Securities | 7,249 | 2,181 | 9,988 | 19,418 | 101,224 | 120,642 | ||||||||||||||||||||||||||||||||
Interest-bearing deposits at other financial institutions | 680,333 | — | — | 680,333 | 40,074 | 720,407 | ||||||||||||||||||||||||||||||||
Federal funds sold | 23,736 | — | — | 23,736 | — | 23,736 | ||||||||||||||||||||||||||||||||
FHLB & FRB stock | — | — | — | — | 7,757 | 7,757 | ||||||||||||||||||||||||||||||||
Total interest earning assets | $ | 815,137 | $ | 87,479 | $ | 287,607 | $ | 1,190,223 | $ | 1,358,376 | $ | 2,548,599 | ||||||||||||||||||||||||||
Liabilities | ||||||||||||||||||||||||||||||||||||||
Interest-bearing liabilities | ||||||||||||||||||||||||||||||||||||||
Interest-bearing deposits | $ | 24,931 | $ | 49,862 | $ | 224,379 | $ | 299,172 | $ | 988,561 | $ | 1,287,733 | ||||||||||||||||||||||||||
Time deposits | 13,104 | 25,557 | 217,688 | 256,349 | 11,275 | 267,624 | ||||||||||||||||||||||||||||||||
Total interest-bearing deposits | 38,035 | 75,419 | 442,067 | 555,521 | 999,836 | 1,555,357 | ||||||||||||||||||||||||||||||||
Securities sold under agreements to repurchase | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||
FHLB advances | — | — | — | — | 35,000 | 35,000 | ||||||||||||||||||||||||||||||||
Subordinated debt | — | — | — | — | 10,016 | 10,016 | ||||||||||||||||||||||||||||||||
Total interest-bearing liabilities | $ | 38,035 | $ | 75,419 | $ | 442,067 | $ | 555,521 | $ | 1,044,852 | $ | 1,600,373 | ||||||||||||||||||||||||||
Period gap | $ | 777,102 | $ | 12,060 | $ | (154,460) | $ | 634,702 | $ | 313,524 | ||||||||||||||||||||||||||||
Cumulative gap | $ | 777,102 | $ | 789,162 | $ | 634,702 | $ | 634,702 | $ | 948,226 | ||||||||||||||||||||||||||||
Ratio of cumulative gap to total earning assets | 95.33 | % | 902.12 | % | 220.68 | % | 53.33 | % | 69.81 | % |
| | | | | | | | | | | | | | | | | | | |
Net Interest Income at Risk – 12 months |
| -400bps |
| -300bps |
| -200bps |
| -100bps |
| Flat |
| +100bps |
| +200bps |
| +300bps |
| +400bps |
|
Policy Limit |
| (20.0) | % | (15.0) | % | (10.0) | % | (5.0) | % | N/A |
| 10.0 | % | 15.0 | % | 20.0 | % | 25.0 | % |
June 30, 2021 |
| (7.8) | % | (5.9) | % | (3.4) | % | (0.7) | % | N/A |
| 9.2 | % | 18.4 | % | 27.5 | % | 36.5 | % |
December 31, 2020 |
| (3.1) | % | (2.4) | % | (1.2) | % | (0.2) | % | N/A |
| 1.5 | % | 3.5 | % | 5.5 | % | 7.3 | % |
December 31, 2019 |
| (9.9) | % | (6.6) | % | (4.7) | % | (1.6) | % | N/A |
| 0.6 | % | 0.8 | % | 1.0 | % | 1.2 | % |
| | | | | | | | | | | | | | | | | | | |
Net Interest Income at Risk – 24 months |
| -400bps |
| -300bps |
| -200bps |
| -100bps |
| Flat |
| +100bps |
| +200bps |
| +300bps |
| +400bps |
|
Policy Limit |
| (20.0) | % | (15.0) | % | (10.0) | % | (5.0) | % | N/A |
| 10.0 | % | 15.0 | % | 20.0 | % | 25.0 | % |
June 30, 2021 |
| (15.3) | % | (12.6) | % | (9.1) | % | (5.4) | % | N/A |
| 11.4 | % | 22.4 | % | 33.5 | % | 44.4 | % |
December 31, 2020 |
| (4.3) | % | (3.6) | % | (2.6) | % | (1.8) | % | N/A |
| 5.8 | % | 12.0 | % | 17.9 | % | 23.6 | % |
December 31, 2019 |
| (16.1) | % | (12.0) | % | (7.7) | % | (2.7) | % | N/A |
| 1.3 | % | 2.3 | % | 3.1 | % | 3.7 | % |
Net Interest Income at Risk – 12 months | -400bps | -300bps | -200bps | -100bps | Flat | +100bps | +200bps | +300bps | +400bps | |||||||||||||||||||||||||||||||||||||||||||||||
Policy Limit | (20.0) | % | (15.0) | % | (10.0) | % | (5.0) | % | N/A | N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||||||||||||
September 30, 2021 | (7.5) | % | (5.5) | % | (2.9) | % | 0.4 | % | N/A | 7.8 | % | 15.6 | % | 23.4 | % | 31.1 | % | |||||||||||||||||||||||||||||||||||||||
December 31, 2020 | (3.1) | % | (2.4) | % | (1.2) | % | (0.2) | % | N/A | 1.5 | % | 3.5 | % | 5.5 | % | 7.3 | % | |||||||||||||||||||||||||||||||||||||||
December 31, 2019 | (9.9) | % | (6.6) | % | (4.7) | % | (1.6) | % | N/A | 0.6 | % | 0.8 | % | 1.0 | % | 1.2 | % | |||||||||||||||||||||||||||||||||||||||
Net Interest Income at Risk – 24 months | -400bps | -300bps | -200bps | -100bps | Flat | +100bps | +200bps | +300bps | +400bps | |||||||||||||||||||||||||||||||||||||||||||||||
Policy Limit | (20.0) | % | (15.0) | % | (10.0) | % | (5.0) | % | N/A | N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||||||||||||
September 30, 2021 | (14.3) | % | (11.7) | % | (8.3) | % | (5.0) | % | N/A | 10.0 | % | 20.1 | % | 30.0 | % | 39.8 | % | |||||||||||||||||||||||||||||||||||||||
December 31, 2020 | (4.3) | % | (3.6) | % | (2.6) | % | (1.8) | % | N/A | 5.8 | % | 12.0 | % | 17.9 | % | 23.6 | % | |||||||||||||||||||||||||||||||||||||||
December 31, 2019 | (16.1) | % | (12.0) | % | (7.7) | % | (2.7) | % | N/A | 1.3 | % | 2.3 | % | 3.1 | % | 3.7 | % |
62
The following table illustrates the results of our EVE analysis as of JuneSeptember 30, 2021, and December 31, 2020, and 2019.
| | | | | | | | | | | | | | | | | | | |
Economic Value of Equity as of |
| -400bps |
| -300bps |
| -200bps |
| -100bps |
| Flat |
| +100bps |
| +200bps |
| +300bps |
| +400bps |
|
Policy Limit |
| (30.0) | % | (20.0) | % | (15.0) | % | (10.0) | % | N/A |
| 17.5 | % | 22.5 | % | 27.5 | % | 37.5 | % |
June 30, 2021 |
| (0.4) | % | (0.5) | % | (0.3) | % | (1.6) | % | N/A |
| 1.8 | % | 3.2 | % | 4.0 | % | 4.2 | % |
December 31, 2020 |
| 0.8 | % | 1.5 | % | 2.6 | % | 2.5 | % | N/A |
| (2.5) | % | (5.1) | % | (8.1) | % | (11.3) | % |
December 31, 2019 |
| (5.3) | % | (0.4) | % | 0.7 | % | 0.6 | % | N/A |
| (3.7) | % | (8.2) | % | (13.2) | % | (19.0) | % |
Economic Value of Equity as of | -400bps | -300bps | -200bps | -100bps | Flat | +100bps | +200bps | +300bps | +400bps | |||||||||||||||||||||||||||||||||||||||||||||||
Policy Limit | (30.0) | % | (20.0) | % | (15.0) | % | (10.0) | % | N/A | 17.5 | % | 22.5 | % | 27.5 | % | 37.5 | % | |||||||||||||||||||||||||||||||||||||||
September 30, 2021 | 2.2 | % | 2.1 | % | 2.1 | % | 0.1 | % | N/A | 0.2 | % | 0.3 | % | (0.1) | % | (1.2) | % | |||||||||||||||||||||||||||||||||||||||
December 31, 2020 | 0.8 | % | 1.5 | % | 2.6 | % | 2.5 | % | N/A | (2.5) | % | (5.1) | % | (8.1) | % | (11.3) | % | |||||||||||||||||||||||||||||||||||||||
December 31, 2019 | (5.3) | % | (0.4) | % | 0.7 | % | 0.6 | % | N/A | (3.7) | % | (8.2) | % | (13.2) | % | (19.0) | % |
63
observable market inputs. For financial instruments that are traded actively and have quoted market prices or observable market inputs, there is minimal subjectivity involved in measuring fair value. However, when quoted market prices or observable market inputs are not fully available, significant management judgment may be necessary to estimate fair value. In developing our fair value estimates, we maximize the use of observable inputs and minimize the use of unobservable inputs.
Additionally, Pro Opp Fund LLC has an additional $0.9 million of unfunded investments outstanding.
vaccination programs and requirements. We sill adjust our response plans where necessary.
64
Management uses these non-GAAP financial measures in its analysis of the Company’s performance and believes these measures are useful supplemental information that can enhance investors’ understanding of the Company’s business and performance without considering taxes or provisions for loan losses and can be useful when comparing performance with other financial institutions. However, these non-GAAP financial measures should not be considered in isolation or as a substitute for the comparable GAAP measures.
| | | | | | | | | | | | | | | | |
| | Three Months Ended | | Three Months Ended | | Six Months Ended | | |||||||||
| | June 30, | | March 31, | | June 30, | | |||||||||
(Dollar amounts in thousands, except per share data) |
| 2021 |
| 2020 |
| 2021 |
| 2021 |
| 2020 | | |||||
Net interest income (GAAP) | | $ | 17,202 | | $ | 16,291 | | $ | 17,879 | | $ | 35,081 | | $ | 24,352 | |
Total non-interest income | | | 2,302 | | | 968 | | | 1,119 | | | 3,421 | | | 1,824 | |
Total non-interest expense | | | 10,954 | | | 11,548 | | | 11,788 | | | 22,742 | | | 21,034 | |
Pre-tax pre-provision earnings (non-GAAP) | | $ | 8,550 | | $ | 5,711 | | $ | 7,210 | | $ | 15,760 | | $ | 5,142 | |
Total adjustments to non-interest expense | | | — | | | (560) | | | (684) | | | (684) | | | (2,223) | |
Adjusted pre-tax pre-provision earnings (non-GAAP) | | $ | 8,550 | | $ | 6,271 | | $ | 7,894 | | $ | 16,444 | | $ | 7,365 | |
| | | | | | | | | | | | | | | | |
Return on average assets (GAAP) | | | 0.99 | % | | 0.38 | % | | 0.90 | % | | 0.95 | % | | 0.24 | % |
Adjusted return on average assets (non-GAAP) | |
| | |
| | |
| | |
| | |
| | |
Annualized pre-tax pre-provision ROAA (non-GAAP) | | | 1.33 | % | | 1.19 | % | | 1.36 | % | | 1.35 | % | | 0.67 | % |
Adjusted annualized pre-tax pre-provision ROAA (non-GAAP) | |
| 1.33 | % |
| 1.30 | % |
| 1.45 | % |
| 1.40 | % |
| 0.96 | % |
| | | | | | | |
| | June 30, 2021 |
| December 31, 2020 | | ||
Total loans (GAAP) | | $ | 1,680,186 | | $ | 1,643,373 | |
Add allowance for loan loss | | | 10,418 | | | 16,259 | |
Add unearned loan origination fees (costs), net | | | 6,839 | | | 5,578 | |
Add loans held for sale | | | 2,039 | | | 1,270 | |
Total gross loans | | $ | 1,699,482 | | $ | 1,666,480 | |
Less PPP loans | | | 144,118 | | | 189,977 | |
Total gross loans excluding Professional Bank PPP loans (non-GAAP) | | $ | 1,555,364 | | $ | 1,476,503 | |
Add purchase accounting loan marks | | | 16,133 | | | 18,835 | |
Total gross loans excluding PPP loans and loan marks (non-GAAP) | | $ | 1,571,497 | | $ | 1,495,338 | |
| | | | | | | |
Allowance for loan loss as a % of total loans (GAAP) | | | 0.62 | % | | 0.99 | % |
Allowance for loan loss as a % of total gross loans excluding Professional Bank PPP loans (non-GAAP) | | | 0.67 | % | | 1.10 | % |
Loan marks + allowance for loan loss / total gross loans excluding PPP loans and loan marks (non-GAAP) | | | 1.69 | % | | 2.35 | % |
Three Months Ended September 30, | Three Months Ended June 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||||
(Dollar amounts in thousands, except per share data) | 2021 | 2020 | 2021 | 2021 | 2020 | ||||||||||||||||||||||||
Net interest income (GAAP) | $ | 19,104 | $ | 17,460 | $ | 17,202 | $ | 54,185 | $ | 41,812 | |||||||||||||||||||
Total non-interest income | 1,476 | 963 | 2,302 | 4,897 | 2,787 | ||||||||||||||||||||||||
Total non-interest expense | 11,624 | 11,713 | 10,954 | 34,366 | 32,747 | ||||||||||||||||||||||||
Pre-tax pre-provision earnings (non-GAAP) | $ | 8,956 | $ | 6,710 | $ | 8,550 | $ | 24,716 | $ | 11,852 | |||||||||||||||||||
Total adjustments to non-interest expense | — | (1,078) | — | (684) | (3,301) | ||||||||||||||||||||||||
Adjusted pre-tax pre-provision earnings (non-GAAP) | $ | 8,956 | $ | 7,788 | $ | 8,550 | $ | 25,400 | $ | 15,153 | |||||||||||||||||||
Return on average assets (GAAP) | 0.97 | % | 0.18 | % | 0.99 | % | 0.96 | % | 0.21 | % | |||||||||||||||||||
Adjusted return on average assets (non-GAAP) | |||||||||||||||||||||||||||||
Annualized pre-tax pre-provision ROAA (non-GAAP) | 1.39 | % | 1.30 | % | 1.33 | % | 1.37 | % | 0.92 | % | |||||||||||||||||||
Adjusted annualized pre-tax pre-provision ROAA (non-GAAP) | 1.39 | % | 1.51 | % | 1.33 | % | 1.41 | % | 1.18 | % |
September 30, 2021 | December 31, 2020 | ||||||||||
Total loans (GAAP) | $ | 1,675,773 | $ | 1,641,422 | |||||||
Add allowance for loan loss | 11,478 | 16,259 | |||||||||
Add loans held for sale | 284 | 1,270 | |||||||||
Total gross loans | $ | 1,687,535 | $ | 1,658,951 | |||||||
Less PPP loans | 85,133 | 185,748 | |||||||||
Total gross loans excluding Professional Bank PPP loans (non-GAAP) | $ | 1,602,402 | $ | 1,473,203 | |||||||
Add purchase accounting loan marks | 14,317 | 18,835 | |||||||||
Total gross loans excluding PPP loans (non-GAAP) | $ | 1,616,719 | $ | 1,492,038 | |||||||
Allowance for loan loss as a % of total loans (GAAP) | 0.68 | % | 0.99 | % | |||||||
Allowance for loan loss as a % of total gross loans excluding Professional Bank PPP loans (non-GAAP) | 0.72 | % | 1.10 | % | |||||||
Loan marks + allowance for loan loss / total gross loans excluding PPP loans (non-GAAP) | 1.60 | % | 2.35 | % |
65
Changes in Internal Control over Financial Reporting
Not applicable.
we redeemed in full, the amount of our subordinated notes payable of $10.0 million, in accordance with its contractual terms.
Purchases of Equity Securities by the Issuer and Affiliated Purchasers.
66
program, shares may be repurchased in privately negotiated and/or open market transactions,
| | | | | | | | |
| | | | | | Approximate Dollar | ||
| | | | | | Value of Shares that | ||
| | Total Number of | | Average Price | | May yet be Purchased | ||
Periods |
| Shares Purchased |
| Paid per Share |
| Under the Plan | ||
April 1, 2021 to April 30, 2021: |
| 443 | | | 16.99 |
| | 4,060,469 |
May 1, 2021 to May 31, 2021: |
| 55,229 | | | 17.95 |
| | 8,995,600 |
June 1, 2021 to June 30, 2021: |
| 137,617 | | | 17.86 |
| | 6,537,348 |
Total - 2nd Quarter | | 193,289 | | $ | 17.88 | | $ | 6,537,348 |
Periods | Total Number of Shares Purchased | Average Price Paid per Share | Approximate Dollar Value of Shares that May yet be Purchased Under the Plan | |||||||||||||||||
July 1, 2021 to July 31, 2021: | 80,428 | $ | 18.15 | $ | 5,074,943 | |||||||||||||||
August 1, 2021 to August 31, 2021: | — | — | 5,074,943 | |||||||||||||||||
September 1, 2021 to September 30, 2021: | 13,171 | 20.72 | 4,832,121 | |||||||||||||||||
Total - 3rd Quarter | 93,599 | $ | 18.19 | $ | 4,832,121 |
|
|
| |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Exhibit No. | Description of Exhibit | ||||||||||
31.1 |
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31.2 |
| ||||||||||
32.1 |
| ||||||||||
32.2 |
| ||||||||||
101.INS |
| XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. | |||||||||
101.SCH |
| XBRL Taxonomy Extension Schema Document | |||||||||
101.CAL |
| XBRL Taxonomy Extension Calculation Linkbase Document | |||||||||
101.DEF |
| XBRL Taxonomy Extension Definition Linkbase Document | |||||||||
101.LAB |
| XBRL Taxonomy Extension Label Linkbase Document | |||||||||
101.PRE |
| XBRL Taxonomy Extension Presentation Linkbase Document | |||||||||
Exhibit 104 |
| Cover Page Interactive Data File - The cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document |
67
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By: | /s/ Daniel R. Sheehan | |||||||
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| Daniel R. Sheehan | ||||||
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| Chairman and Chief Executive Officer |
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Signature | Title | Date | ||||||||||||
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/s/ Daniel R. Sheehan |
| Chairman and Chief Executive Officer |
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Daniel R. Sheehan |
| (Principal Executive Officer) |
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/s/ Mary Usategui |
| Chief Accounting Officer |
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Mary Usategui |
| (Principal Financial Officer and Principal Accounting Officer) |
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/s/ Margaret Blakey |
| Director |
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Margaret Blakey |
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/s/ Rolando DiGasbarro |
| Director |
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Rolando DiGasbarro |
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/s/ Norman Edelcup |
| Director |
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Norman Edelcup |
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/s/ Carlos M. Garcia |
| Director |
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Carlos M. Garcia |
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/s/ Jon L. Gorney |
| Director |
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Jon L. Gorney |
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/s/ Abel L. Iglesias |
| Director |
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Abel L. Iglesias |
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/s/ Herbert Martens, Jr |
| Director |
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Herbert Martens, Jr. |
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/s/ Ava L. Parker |
| Director |
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Ava L. Parker |
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/s/ Lawrence Schimmel |
| Director |
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Dr. Lawrence Schimmel, M.D. |
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