Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Feb. 28, 2020 | Jun. 28, 2019 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document period end date | Dec. 31, 2019 | ||
Document Transition Report | false | ||
Commission file number | 000-50448 | ||
Entity registrant name | MARLIN BUSINESS SERVICES CORP. | ||
Entity Incorporation, State Country Name | PA | ||
Employer Identification Number (EIN) | 38-3686388 | ||
Address Line 1 | 300 Fellowship Road | ||
Name of the City or Town | Mount Laurel | ||
Entity state | NJ | ||
Code for the postal or zip code | 08054 | ||
Area code | 888 | ||
Local phone number | 479-9111 | ||
Title of a 12(b | Common Stock, $.01 per share | ||
Trading Symbol | MRLN | ||
Name of the Exchange | NASDAQ | ||
Entity well known seasoned issuer | No | ||
Entity Interactive Data Current | Yes | ||
Entity current reporting status | Yes | ||
Entity filer category | Accelerated Filer | ||
Current fiscal year end date | --12-31 | ||
Entity voluntary filers | No | ||
Entity common stock shares outstanding | 11,993,407 | ||
Entity public float | $ 211,751,242 | ||
Entity Shell Company | false | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Documents incorporated by reference | DOCUMENTS INCORPORATED BY REFERENCE Portions of the Registrant’s definitive Proxy Statement related to the 2020 Annual Meeting of Shareholders, to be filed with the Securities and Exchange Commission within 120 days of the close of Registrant’s fiscal year, are incorporated by reference into Part III of this Form 10-K. | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Entity central index key | 0001260968 | ||
Amendment flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
ASSETS | ||
Cash and due from banks | $ 4,701,000 | $ 5,088,000 |
Interest-earning deposits with banks | 118,395,000 | 92,068,000 |
Total cash and cash equivalents | 123,096,000 | 97,156,000 |
Time deposits with banks | 12,927,000 | 9,659,000 |
Restricted interest-earning deposits (includes $6.9 and $10.0 million at December 31, 2019,and December 31, 2018, respectively, related to consolidated VIEs) | 6,931,000 | 14,045,000 |
Investment securities (amortized cost of $11.1 million and $11.2 million at December 31, 2019 and December 31, 2018, respectively) | 11,076,000 | 10,956,000 |
Net investment in leases and loans [Abstract] | ||
Leases | 426,608,000 | 489,299,000 |
Loans | 601,607,000 | 527,541,000 |
Net investment in leases and loans, (includes $76.1 million and $150.2 million at December 31, 2019 and December 31, 2018, respectively, related to consolidated VIEs) | 1,028,215,000 | 1,016,840,000 |
Allowance for Credit Losses | (21,695,000) | (16,100,000) |
Net investment in leases and loans | 1,006,520,000 | 1,000,740,000 |
Intangible assets | 7,461,000 | 7,912,000 |
Goodwill | 6,735,000 | 7,360,000 |
Operating lease right-of-use assets | 8,863,000 | 0 |
Property and equipment, Net | 7,888,000 | 4,317,000 |
Property tax receivables | 5,493,000 | 5,245,000 |
Other assets | 10,453,000 | 9,656,000 |
Total assets | 1,207,443,000 | 1,167,046,000 |
LIABILITIES AND STOCKHOLDERS EQUITY | ||
Deposits | 839,132,000 | 755,776,000 |
Operating lease liabilities | 9,730,000 | 0 |
Other liabilities: | ||
Sales and property taxes payable | 2,678,000 | 3,775,000 |
Accounts payable and accrued expenses | 34,028,000 | 36,369,000 |
Net Deferred Income Tax Liability | 30,828,000 | 22,560,000 |
Total liabilities | 992,487,000 | 968,535,000 |
Commitments and contingencies (Note 12) | ||
Stockholders' equity: | ||
Preferred Stock, $0.01 par value; 5,000,000 shares authorized; none issued | 0 | 0 |
Common Stock, $0.01 par value; 75,000,000 shares authorized; 12,113,585 and 12,367,724 shares issued and outstanding at December 31, 2019 and December 31, 2018, respectively | 121,000 | 124,000 |
Additional paid-in capital | 79,665,000 | 83,496,000 |
Accumulated other comprehensive income (loss) | 58,000 | (44,000) |
Retained earnings | 135,112,000 | 114,935,000 |
Total stockholders' equity | 214,956,000 | 198,511,000 |
Total liabilities and stockholders' equity | 1,207,443,000 | 1,167,046,000 |
Variable Interest Entity, Primary Beneficiary [Member] | ||
ASSETS | ||
Restricted interest-earning deposits (includes $6.9 and $10.0 million at December 31, 2019,and December 31, 2018, respectively, related to consolidated VIEs) | 6,900,000 | 10,000,000 |
Net investment in leases and loans [Abstract] | ||
Net investment in leases and loans, (includes $76.1 million and $150.2 million at December 31, 2019 and December 31, 2018, respectively, related to consolidated VIEs) | 76,100,000 | 150,200,000 |
Long-term borrowings related to consolidated VIEs | $ 76,091,000 | $ 150,055,000 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Consolidated Balance Sheets [Abstract] | ||
Available-for-sale securities, amortized cost | $ 11,100 | $ 11,200 |
Common stock par value | $ 0.01 | $ 0.01 |
Common stock shares authorized | 75,000,000 | 75,000,000 |
Common stock shares issued | 12,113,585 | 12,367,724 |
Common stock shares outstanding | 12,113,585 | 12,367,724 |
Preferred stock - par or stated value | $ 0.01 | $ 0.01 |
Preferred stock shares authorized | 5,000,000 | 5,000,000 |
Preferred stock shares issued | 0 | 0 |
Variable Interest Entity [Line Items] | ||
Restricted interest-earning deposits with banks | $ 6,931 | $ 14,045 |
Net investment in leases and loans, excluding allowance for credit losses | 1,028,215 | 1,016,840 |
Variable Interest Entity, Primary Beneficiary [Member] | ||
Variable Interest Entity [Line Items] | ||
Restricted interest-earning deposits with banks | 6,900 | 10,000 |
Net investment in leases and loans, excluding allowance for credit losses | $ 76,100 | $ 150,200 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Consolidated Statements of Operations | |||
Interest income | $ 107,420 | $ 97,025 | $ 87,455 |
Fee income | 15,205 | 15,843 | 14,864 |
Interest and fee income | 122,625 | 112,868 | 102,319 |
Interest expense | 25,033 | 17,414 | 11,180 |
Net interest and fee income | 97,592 | 95,454 | 91,139 |
Provision for credit losses | 28,036 | 19,522 | 18,394 |
Net interest and fee income after provision for credit losses | 69,556 | 75,932 | 72,745 |
Non-interest income: | |||
Gain on leases and loans sold | 22,210 | 8,363 | 2,818 |
Insurance premiums written and earned | 8,796 | 8,087 | 7,155 |
Other income | 13,025 | 4,984 | 6,759 |
Noninterest Income | 44,031 | 21,434 | 16,732 |
Non-interest expense: | |||
Salaries and benefits | 44,168 | 39,750 | 37,569 |
General and administrative | 32,566 | 24,915 | 28,272 |
Non interest expense | 76,734 | 64,665 | 65,841 |
Income before income taxes | 36,853 | 32,701 | 23,636 |
Income tax expense | 9,737 | 7,721 | (1,656) |
Net income | $ 27,116 | $ 24,980 | $ 25,292 |
Basic earnings per share | $ 2.21 | $ 2.01 | $ 2.02 |
Diluted earnings per share | $ 2.2 | $ 2 | $ 2.01 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Comprehensive Income | |||||||||||
Net income | $ 8,414 | $ 7,446 | $ 6,115 | $ 5,141 | $ 6,422 | $ 5,906 | $ 6,467 | $ 6,185 | $ 27,116 | $ 24,980 | $ 25,292 |
Other Comprehensive Income | |||||||||||
Reclassification due to adoption of ASU 2016-01, ASU 2018-02 and ASU 2018-03 | 0 | 107 | 0 | ||||||||
Net change in unrealized gain (loss) on securities available for sale | 138 | (7) | 68 | ||||||||
Tax effect | (36) | (48) | (26) | ||||||||
Total other comprehensive income | 102 | 52 | 42 | ||||||||
Comprehensive Income | $ 27,218 | $ 25,032 | $ 25,334 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) | Total | Common Stock [Member] | Additional Paid In Capital [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Retained Earnings [Member] | ||
Balance at Dec. 31, 2016 | $ 162,289,000 | $ 126,000 | $ 83,503,000 | $ (138,000) | $ 78,798,000 | ||
Balance, Shares at Dec. 31, 2016 | 12,572,114 | 12,572,114 | |||||
Issuance of common stock | $ 356,000 | $ 0 | 356,000 | 0 | 0 | ||
Issuance of common stock, shares | 18,890 | 18,890 | |||||
Repurchase of common stock | $ (4,501,000) | $ (2,000) | (4,499,000) | 0 | 0 | ||
Repurchase of common stock, shares | (184,263) | (184,263) | |||||
Exercise of stock options | $ 488,000 | $ 0 | 488,000 | 0 | 0 | ||
Exercise of stock options, shares | 39,416 | 39,416 | |||||
Restricted stock grant, shares | 3,301 | 3,301 | |||||
Stock-based Compensation Expense | $ 2,738,000 | $ 0 | 2,738,000 | 0 | 0 | ||
Net change in unrealized gain/loss on securities available for sale, net of tax | 42,000 | 0 | 0 | 42,000 | 0 | ||
Net income | 25,292,000 | 0 | 0 | 0 | 25,292,000 | ||
Cash dividends paid, ($0.56, $0.56, and $0.56 per share for years: 2016, 2017 and 2018 respectively) | (7,055,000) | 0 | 0 | (7,055,000) | |||
Balance at Dec. 31, 2017 | $ 179,649,000 | $ 124,000 | 82,586,000 | (96,000) | 97,035,000 | ||
Balance, Shares at Dec. 31, 2017 | 12,449,458 | 12,449,458 | |||||
Issuance of common stock | $ 401,000 | $ 0 | 401,000 | 0 | 0 | ||
Issuance of common stock, shares | 18,076 | 18,076 | |||||
Repurchase of common stock | $ (2,908,000) | $ 0 | (2,908,000) | 0 | 0 | ||
Repurchase of common stock, shares | (111,910) | (111,910) | |||||
Exercise of stock options | $ 23,000 | $ 0 | 23,000 | 0 | 0 | ||
Exercise of stock options, shares | 909 | 909 | |||||
Restricted stock grant, shares | 11,191 | 11,191 | |||||
Stock-based Compensation Expense | $ 3,394,000 | $ 0 | 3,394,000 | 0 | 0 | ||
Net change in unrealized gain/loss on securities available for sale, net of tax | (5,000) | 0 | 0 | (5,000) | 0 | ||
Net income | 24,980,000 | 0 | 0 | 0 | 24,980,000 | ||
Impact of adoption of new accounting standards | 0 | 0 | 0 | 57,000 | [1] | (57,000) | [1] |
Cash dividends paid, ($0.56, $0.56, and $0.56 per share for years: 2016, 2017 and 2018 respectively) | (7,023,000) | 0 | 0 | 0 | (7,023,000) | ||
Balance at Dec. 31, 2018 | $ 198,511,000 | $ 124,000 | 83,496,000 | (44,000) | 114,935,000 | ||
Balance, Shares at Dec. 31, 2018 | 12,367,724 | 12,367,724 | |||||
Issuance of common stock | $ 410,000 | $ 0 | 410,000 | 0 | 0 | ||
Issuance of common stock, shares | 18,458 | 18,458 | |||||
Repurchase of common stock | $ (7,323,000) | $ (3,000) | (7,320,000) | 0 | 0 | ||
Repurchase of common stock, shares | (317,427) | (317,427) | |||||
Exercise of stock options, shares | 0 | ||||||
Restricted stock grant, shares | 44,830 | 44,830 | |||||
Stock-based Compensation Expense | $ 3,079,000 | $ 0 | 3,079,000 | 0 | 0 | ||
Net change in unrealized gain/loss on securities available for sale, net of tax | 102,000 | 0 | 0 | 102,000 | 0 | ||
Net income | 27,116,000 | 0 | 0 | 0 | 27,116,000 | ||
Cash dividends paid, ($0.56, $0.56, and $0.56 per share for years: 2016, 2017 and 2018 respectively) | (6,939,000) | 0 | 0 | 0 | (6,939,000) | ||
Balance at Dec. 31, 2019 | $ 214,956,000 | $ 121,000 | $ 79,665,000 | $ 58,000 | $ 135,112,000 | ||
Balance, Shares at Dec. 31, 2019 | 12,113,585 | 12,113,585 | |||||
[1] | (1) Represents the impact of Accounting Standards Update ("ASU") 2016-01, ASU 2018-02 and ASU 2018-03 |
Consolidated Statements of St_2
Consolidated Statements of Stockholders' Equity (Parentheticals) - $ / shares | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statements Of Stockholders Equity [Abstract] | ||||||||||||
Cash dividends declared and paid per share | $ 0.14 | $ 0.14 | $ 0.14 | $ 0.14 | $ 0.14 | $ 0.14 | $ 0.14 | $ 0.14 | $ 0.14 | $ 0.56 | $ 0.56 | $ 0.56 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Cash flows from operating activities: | |||
Net income | $ 27,116 | $ 24,980 | $ 25,292 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 4,065 | 3,146 | 2,964 |
Stock-based compensation | 3,079 | 3,394 | 2,738 |
Change in fair value of equity securities | (104) | 75 | 0 |
Provision for credit losses | 28,036 | 19,522 | 18,394 |
Net deferred income taxes | 8,233 | 5,821 | 1,598 |
Amortization of deferred initial direct costs and fees | 14,846 | 13,361 | 11,375 |
Loss on equipment disposed | 1,819 | 1,219 | 1,070 |
Gain on Leases Sold | (22,210) | (8,363) | (2,818) |
Leases originated for sale | (62,371) | (17,436) | (4,669) |
Proceeds from sale of leases originated for sale | 64,751 | 18,069 | 4,727 |
Non cash lease expense | 1,201 | ||
Adjustment to value of contingent consideration | 250 | ||
Effect of changes in other operating items: | |||
Other assets | (1,574) | 16,942 | (19,026) |
Other liabilities | (4,717) | 3,652 | 11,226 |
Net cash provided by (used in) operating activities | 62,420 | 84,381 | 52,871 |
Cash flows from investing activities: | |||
Net change in time deposits with banks | (3,268) | (1,549) | 1,495 |
Purchases of equipment for direct financing lease contracts and funds used to originate loans | (816,834) | (722,745) | (634,709) |
Principal collections on leases and loans | 517,338 | 476,533 | 426,482 |
Proceeds from sale of leases originated for investment | 267,874 | 129,290 | 64,895 |
Security deposits collected, net of refunds | (246) | (210) | (448) |
Proceeds from the sale of equipment | 2,654 | 3,120 | 3,415 |
Acquisitions of property and equipment | (5,657) | (1,836) | (1,854) |
Acquisition of businesses | 0 | (10,000) | 2,500 |
Purchases of securities available for sale | (5,601) | ||
Proceeds from sale securities available for sale | 98 | 465 | |
Net cash provided by (used in) investing activities | (38,041) | (126,932) | (148,825) |
Cash flows from financing activities: | |||
Net change in deposits | 83,356 | (53,539) | 111,958 |
Term securitization advances | 0 | 201,650 | 0 |
Term securitization repayments | (74,670) | (50,417) | 0 |
Business combinations earn-out consideration payments | (461) | 0 | |
Issuances of common stock | 410 | 401 | 356 |
Repurchases of common stock | (7,323) | (2,908) | (4,501) |
Dividends paid | (6,865) | (6,936) | (6,958) |
Exercise of stock options | 0 | 23 | 488 |
Debt issuance costs | 0 | (1,668) | 0 |
Net cash provided by (used in) financing activities | (5,553) | 86,606 | 101,343 |
Net increase (decrease) in total cash and cash equivalents | 18,826 | 44,055 | 5,389 |
Total cash and cash equivalents, beginning of period | 111,201 | 67,146 | 61,757 |
Total cash and cash equivalents, end of period | 130,027 | 111,201 | 67,146 |
Supplemental disclosures of cash flow information: | |||
Cash paid for interest on deposits and borrowings | 23,535 | 16,130 | 10,329 |
Net cash paid (refunds received) for income taxes | 2,574 | (12,634) | 10,195 |
Transfer of leases to held-for-sale | 248,044 | 121,559 | 62,077 |
Supplemental disclosures of noncash investing activities: | |||
Acquisition of property and equipment through capital lease arrangements | 0 | 0 | 385 |
Business combinations assets acquired | 0 | 3,376 | 0 |
Purchase of equipment for direct financing lease contracts and loans originated | 6,916 | 8,588 | 10,681 |
Reconciliation of cash, cash equivalents and restricted cash to the consolidated balance sheets | |||
Cash and cash equivalents | 123,096 | 97,156 | 67,146 |
Restricted Cash | $ 6,931 | $ 14,045 | $ 0 |
The Company
The Company | 12 Months Ended |
Dec. 31, 2019 | |
The Company [Abstract] | |
The Company | NOTE 1 - The Company Marlin Business Services Corp. (the “Company”) is a nationwide provider of credit products and services to small and mid-sized businesses. The products and services we provide to our customers include loans and leases for the acquisition of commercial equipment (including Commercial Vehicle Group (“CVG”) assets which now incorporates our Transportation Finance Group (“TFG”)) and working capital loans. The Company was incorporated in the Commonwealth of Pennsylvania on August 5, 2003. In May 2000, we established AssuranceOne, Ltd., a Bermuda-based, wholly-owned captive insurance subsidiary (“Assurance One”), which enables us to r einsure the property insurance coverage for the equipment financed by Marlin Leasing Corporation (“MLC”) and Marlin Business Bank (“MBB”) for our small business customers. Effective March 12, 2008, the Company opened MBB, a commercial bank chartered by the State of Utah and a member of the Federal Reserve System. MBB serves as the Company’s primary funding source through its issuance of Federal Deposit Insurance Corporation (“FDIC”)-insured deposits. I n January 2017, the Company completed the acquisition o f Horizon Keystone Financial (“HKF”), an equipment leasing company which primarily identifies and sources lease and loan contracts for investor partners for a fee. On September 19, 2018, the Company completed the acquisition of Fleet Financing Resources (“FFR”), an equipment finance company specializing in the leasing and financing of both new and used commercial vehicles, with an emphasis on livery equipment and other types of commercial vehicles used by small businesses . This acquisition is consistent with our strategy of augmenting organic growth with strategic acquisitions that extend our existing equipment finance business into new and attractive markets and is a new addition to the CVG. The Company paid $ 10.0 million in cash for FFR and incurred a n immaterial amount of acquisition-related cost. In addition, if FFR generates revenue volume of up to $ 542 million from the closing date through September 30, 2026, we have agreed to pay the seller up to an additional $ 5.5 million in cash in earn-out con sideration. This earn-out consideration will be calculated quarterly based on a sliding scale of percentage of revenue volume that increases as successively greater tiers of volume are attained, and if the maximum earn-out consideration is earned, the tota l consideration paid for FFR will be $ 15.5 million. The earn-out will be remeasured to fair value at each reporting period, and the difference between the revised fair value estimate and the earn-out liability will be recorded in earnings. The Company comp leted the purchase price allocation in the first quarter of 2019 with $ 5.6 million recorded to goodwill and $ 7.6 million recorded to intangible assets for vendor relationships and lender relationships, offset by a contingent consideration liability of $ 3.2 million representing the estimated fair value of the earn-out. See Note 8 for additional information regarding the identified intangible assets acquired. The acquisition has been accounted for using the acquisition method of accounting. The unaudited pro forma financial information disclosed in the following sentence is for informational purposes only and is not indicative of future operations or results. If the acquisition had occurred at the beginning of 2017, the Company’s Interest and fee income, Non-interest income and net income for the year ended December 31, 2018, would have been approximately $ 118.3 million, $ 21.7 million and $ 26.3 million, respectively, and for the year ended December 31, 2017 would have be en approximately $ 107.8 million, $ 16.9 million and $ 26.5 million, respectively . References to the “Company,” “Marlin,” “Registrant,” “we,” “us” and “our” herein refer to Marlin Business Services Corp. and its wholly-owned subsidiaries, unless the context otherwise requires. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Significant Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | NOTE 2 - Summary of Significant Accounting Policies Basis of Financial Statement Presentation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. The Company has one reportable segment, which includes the Company’s commercial lending and leasing financial products and related services, including equipment loans and leases, property insurance on leased equipment, and working capital loans . All intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in accordance with generally accepted accounting principles in the Uni ted States (“ U.S. GAAP ”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts o f revenues and expenses during the reporting period. Estimates are used when accounting for income recognition, the residual values of leased equipment, the allowance for credit losses, deferred initial direct costs and fees, late fee receivables, the fair value of financial instruments , estimated losses from insurance program, and income taxes. Actual results could differ from those estimates. Cash and Cash Equivalents Cash and cash equivalents include cash and interest-bearing money market funds. For purposes of the consolidated statement of cash flows, the Company considers all highly liquid investments purchased with a maturity of three months or less to be cash equivalents. Time Deposits with Banks Time deposits with banks are composed of FDIC-insured certificates of deposits that generally have original maturity dates of greater than 90 days. These deposits are held on the balance sheet at amortized cost. Generally, the certificates of deposits issu ed directly have the ability to redeem early; however early redemption penalties may be incurred. The certificates of deposit issued through deposit brokers generally do not have the ability to redeem early. Restricted Interest-Earning Deposits with Banks Restricted interest-earning deposits with banks consist primarily of various interest-earning trust accounts primarily related to the Company’s secured debt facilities including amounts due from securitizations representing reimbursements of servicing fe es and excess spread income. In addition, as of December 31, 2018, t he restricted balance also includes $ 4.0 million of funds reserved for payments related to customer restitution (see Note 12 – Commitments and Co ntingencies). Investments Available for Sale. Debt securities, a vailable for sale i nclud e asset-backed securities (“ABS”) and municipal bonds that are measured at fair value on a recurring basis. Debt securities, available for sale, are recorded at fair value, and unrealized gains and losses, net of tax, are reported, net of taxes, in accumulated other comprehensive income (loss) included in stockholders’ equity unless management determines that an investme nt is other-than-temporarily impaired (OTTI). Fair value measurement is based upon quoted prices in active markets, if available. If quoted prices in active markets are not available, fair values are based on prices obtained from third-party pricing vendors . See Note 15 for more information on fair value measurement of securities . Securities are evaluated on a quarterly basis, and more fr equently when market conditions warrant such an evaluation, to determine whether declines in their value are other-than-temporary (OTTI) . To determine whether a loss in value is other-than-temporary, management utilizes criteria such as the reasons underly ing the decline, the magnitude and duration of the decline and whether management intends to sell or expects that it is more likely than not that it will be required to sell the security prior to an anticipated recovery of the fair value. The term “other-t han-temporary” is not intended to indicate that the decline is permanent, but indicates that the prospects for a near-term recovery of value is not necessarily favorable, or that there is a lack of evidence to support a realizable value equal to or greater than the carrying value of the investment. Once a decline in value for a deb t security is determined to be other-than-temporary, the other-than-temporary impairment is separated into (a) the amount of the total other-than-temporary impairment related to a decrease in cash flows expected to be collected from the debt security (the credit loss) and (b) the amount of the total other-than-temporary impairment related to all other factors. The amount of the total other-than-temporary impairment related to the credit loss is recognized in earnings. The amount of the total other-than-temp orary impairment related to all other factors is recognized in other comprehensive income. Equity Securities. Equity securities represent mutual funds that are recorded at fair value. For the years ended December 31, 2018 and 2019, unrealized gains and losses of equity securities are recorded through the Consolidated Statement of Operations. For the year ended December 31, 2017, prior to the January 1, 2018 adoption of ASU 2016-01, unrealized gains and losses of equity securities classified as available for sale were reported in other comprehensive income (loss). Net Investment in Leases and Loans T he Company uses the direct finance method of accounting to record its sales-type leases and related interest income. At the inception of a lease, the Company records as an asset, the aggregate future minimum lease payments receivable, plus the estimated residual value of the leased equipment, less unearned lease income. Residual values are established at lease inception based on our estimate of the expected fair value of the equipment at the end of the lease term. Residual values may be realized at lease termination from lease extensions, sales or other dispositions of leased equipment. Estimates are based on industry data, management’s experience, and historical performance. The Company records an estimated residual value at lease inception for all fair market value and fixed purchase option leases based on a percentage of the equipm ent cost of the asset being leased. The percentages used depend on equipment type and term. In setting estimated residual values, the Company focuses its analysis primarily on the Company’s total historical and expected realization statistics pertaining to sales of equipment. In subsequent evaluations for the impairment of the booked residual values, the Company reviews historical realization statistics including lease renewals and equipment sales. Anticipated renewal income is not included in the determi nation of fair value; however, it is one of the ways that fair value may be realized at the end of the lease term. At the end of an original lease term, lessees may choose to purchase the equipment, renew the lease or return the equipment to the Company. The Company receives income from lease renewals when the lessee elects to retain the equipment longer than the original term of the lease. This income, net of appropriate periodic reductions in the estimated residual values of the related equipmen t, is included in fee income as net residual income. When a lessee elects to return equipment at lease termination, the equipment is transferred to other assets at the lower of its basis or fair market value. The Company generally sells returned equipmen t to independent third parties, rather than leasing the equipment a second time. The Company generally charges off the value of equipment within other assets once it has been aged greater than 120 days. Any loss recognized on transferring equipment to othe r assets and any gain or loss realized on the sale or disposal of equipment to a lessee or to others is included in fee income as net residual income. Based on the Company’s experience, the amount of ultimate realization of the residual value tends to re late more to the customer’s election at the end of the lease term to enter into a renewal period, to purchase the leased equipment or to return the leased equipment than it does to the equipment type. Management performs reviews of the estimated residual values and historic realization statistics no less frequently than quarterly and any impairment, if other than temporary, is recognized in the current period. Loans are stated at principal balance, net of deferred fees and costs. Loan origination fees, co mmitment fees and direct loan origination costs are deferred and recognized over the life of the related loans using an effective yield method over the period to maturity. Initial direct costs and fees related to lease originations are deferred as part of the investment and amortized over the lease term. Unearned lease income is the amount by which the total lease receivable plus the estimated residual value exceeds the cost of the equipment. Unearned lease income, net of initial direct costs and fees, is recognized as revenue over the lease term using the effective interest method. Allowance for Credit Losses The Company maintain s an allowance for credit losses at an amount sufficient to absorb losses inherent in our existing lease and loan portfolios as of the reporting dates based on our projection of probable net credit losses. The allowance is analyzed based on portfolio segments, which represent the level at which the Company develop s and document s a systematic methodology to determine the allowance for credit losses. As of December 31, 201 9 , the portfolio includes four segments, which consist of equipment lease and loan, Working Capital Loans, CVG , and Community Reinvestment Act (“CRA”) loans, of which all methodologies are evaluated on a pooled basis, due to their composition of similar accounts with similar general credit risk characteristics, diversified among industry, geography, equipment type (if applicable), obligor and vendor (if applicable). The Company has determined there to be one class of financing receivable within each portfolio segment as finance receivables of each segment contain the same initial measurement attributes, risk characteristics, and has the same method for monitoring and assessing credit risk within the segment. Each segment generally considers both quantitative and qualitative factors in determining the allowance for credit losses: F or the E quipment lease and loan segment , quantitative factors include a migration analysis stratified by industry classification, historic delinquencies and charge-offs, and a static pool analysis of historic recoveries. A migration analysis is a technique used to estimate the likelihood that an account will progress through the various delinquency stages and ultimately charge off. A loss emergence period (LEP), which is the period of time between an event that triggers the probability of a loss and the confirmation of loss, is applied to the migration results to develop an estimate of losses inherent in the portfolio at the reporting period. F or the CVG and Working Capital l oan segments , quantitative factors include establishing a loss curve based on historical analysis of net charge-offs. The loss curve technique is used to estimate the likelihood and timing of when an account will charge-off relative to the month in which it was funded. An LEP is applied to the loss curve results to develop an estimate of losses inherent in the portfolio at the reporting period. The CVG and Working Capital Loans segments utilize different assumptions for the historical charge-offs and loss emergence which is based on analysis specific to each segment. For t he CRA loan segment , quantitative factor includes the analysis of historical losses that are used in conjunction with an LEP to develop a quantitative allowance for credit losses. As part of our quantitative analyses for each segment our measurement may also consider specifically identified pools of equipment leases or loans separately from the quantitative analysis, whenever certain identified pools are not expected to perform consistently with their credit characteristics or the portfolio segment a s a whole . These lease and loan pools may be analyzed for impairment separately quantitative analysis and a specific reserve established. Qualitative factors that may result in further adjustments to the quantitative analyses include items such as change s in the composition of our lease and loan portfolio segments (including geography, industry, equipment type and vendor source), seasonality, economic or business conditions and other external factors, business practices or policies at the reporting date t hat are different from the periods used in the quantitative analyses and changes in experience and ability of leasing and lending management and other relevant staff. The various factors used in the analysis are reviewed periodically, and no less frequently than quarterly. The allowance for credit losses is then established based on this analysis for the projected probable net credit losses inherent in the portfolio. A provision is charged against earnings to maintain the allowance for credit losses at the appropriate level. Our policy is to generally charge-off against the allowance the estimated unrecoverable portion of accounts once they reach 120 or more days delinqu ent. Our projections of probable net credit losses are inherently uncertain, and as a result we cannot predict with certainty the amount of such losses. Changes in economic conditions, the risk characteristics and composition of the portfolio, bankruptcy laws, and other factors could impact our actual and projected net credit losses and the related allowance for credit losses . Actual losses may vary from current estimates. See further discussion under “— Recently Issued Accounting Standards” of the Januar y 1, 2020 adoption of ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, that resulted in significant changes to the company’s allowance measurement as of January 1, 2020. No amounts were reflected in these financial statements in connection with the adoption. Goodwill and Intangible Assets The Company tests for impairment o f goodwill at least annually and more frequently as circumstances warrant in accordance with applicable accounting guidance. Accounting guidance allows for the testing of goodwill for impairment using both qualitative and quantitative factors. Impairment o f goodwill is recognized only if the carrying amount of the Company, including goodwill, exceeds the fair value of the Company. The amount of the impairment loss would be equal to the excess carrying value of the goodwill over the implied fair value of the Company’s goodwill. Currently, the Company does not have any intangible assets with indefinite useful lives. Intangible assets that are not deemed to have an indefinite useful life are amortized over their estimated useful lives. The carrying amounts of intangible assets are regularly reviewed for indicators of impairment in accordance with applicable accounting guidance. Impairment is recognized only if the carrying amount of the intangible asset is in excess of its undiscounted projected cash flows. Im pairment is measured as the difference between the carrying amount and the estimated fair value of the asset. Leases The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets and operating lease liabilities on our consolidated balance sheets. ROU assets and operating lease liabilities are recognized based on the present value of the future lease payments over the lease term at commencement date. As m ost of our leases do not provide an implicit rate, in order to determine the present value of future payments for office leases we use an incremental borrowing rate based on the information available through real estate databases for similar locations and for the present value of future payments for equipment leases we use the average rate of our term note securitization which is collateralized by similar equipment. The ROU asset also includes any lease payments made and excludes lease incentives. Our lease terms may include options to extend when it is reasonably certain that we will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. Property and Equipment P roperty and equipment are recorded at cost. Equipment capitalized under capital leases is recorded at the present value of the minimum lease payments due over the lease term. Depreciation and amortization are provided using the straight-line method over the estimated useful lives of the related assets or lease term, whichever is shorter. D epreciable lives generally range from three to seven years based on equipment type. Other Asset s Included in other assets on the Consolidated Balance Sheets are prepaid expenses, ac crued fee income , progress payments on equipment purchased to lease , income taxes receivable and Federal Reserve Bank stock. Revenue Recognition The majority of the Company’s revenue-generating transactions are not subject to ASC 606, Revenue from Contracts with Customers , including revenue generated from financial instruments, such as our leases and loans, investment securities, as well as revenue related to our gain on sale of leases and loans, servicing income, and insurance premiums written and earned. Revenue-generating activities that the Company accounts for under ASC 606, which are presented in our income statements as components of non-int erest income, include certain fees such as property tax administrative fees on leases, ACH payment fees, insurance policy fees outside of the scope of ASC 944, broker fees earned for referring leases and loans to other funding partners, and other fees. Revenue— Interest Income . Interest income is recognized under the effective interest method. The effective interest method of income recognition applies a constant rate of interest equal to the internal rate of return on each lease at inception. Based o n the historical payment behavior of the Company’s equipment finance lease and loan portfolio as a whole, payments are considered reasonably assured when a lease or loan’s delinquency status is less than 90 days. Therefore, when a lease or loan is 90 days or more delinquent, the contract is classified as non-accrual and interest income recognition is discontinued. Interest income recognition resumes when the borrower makes payments sufficient to bring the status to less than 90 days delinquent. Working Capi tal Loans are generally placed in non-accrual status when they are 30 days past due and charged-off at 60 days past due . The loan is removed from non-accrual status once sufficient payments are made to bring the loan current and reviewed by management. Revenue— Fee Income . Fee income consists of fees for delinquent lease and loan payments, cash collected on early termination of leases and net residual income. Net residual income includes income from lease renewals and gains and losses on the realization of residual values of leased equipment disposed at the end of a lease’s term. Residual income is recognized as earned. Fee income from delinquent lease payments is recognized on an accrual basis based on anticipated collection rates. At a minimum of ever y quarter, an analysis of anticipated collection rates is performed based on updates to collection history. Adjustments in the anticipated collection rate assumptions are made as needed based on this analysis. Other fees are recognized when received. Revenue— Non-Interest Incom e. The Company ’s non-interest income includes certain fees such as property tax administrative fees on leases, ACH payment fees, insurance policy fees outside of the scope of ASC 944, broker fees earned for referring leases and l oans to other funding partners, and other fees. Insurance premiums written and earned are recognized on an accrual basis over the term of the policy, which is month to month. Generally, insurance payments that are 120 days or more past due are charged aga inst income. Since the policy’s premiums are recognized month to month, there is no unearned premium on the Consolidated Balance Sheets as these are fully recognized through the Consolidated Statements of Operations in the month written . Gain on sale of leases and loans is recognized in connection with the Company’s transactions to sell populations of contracts to third parties. When the transfer qualifies as a sale, the lease and loan assets are derecognized and the Company recognizes any gain (or loss) and the servicing asset and liability as applicable on the sale date driven by the pricing and net proceeds received . In the event the transfer does not qualify as a sale, the transfer would be treated as a secured borrowing. The Company may have continuing involvement in leases and loans sold through servicing the sold assets, or through limited recourse provisions. Securitizations In connection with its term note securitization transaction, the Company established a bankruptcy remote special-purpose subsidiary (“SPE”) and issued term debt to institutional investors. This type of SPE is considered a variable interest entity (“VIE”) under U.S. generally accepted accounting principles (“GAAP”). The Company is required to consolidate a VI E in which it is deemed to be the primary beneficiary through having (1) power over the significant activities of the entity and (2) an obligation to absorb losses or the right to receive benefits from the VIE which are potentially significant to the VIE. The Company continues to service the assets of its VIEs and retain equity and/or residual interests. Accordingly, assets and related debt of these VIEs are included in the accompanying Consolidated Balance Sheets. The Company’s leases and restricted inter est-earning deposits with banks are assigned as collateral for these borrowings and there is no further recourse to our general credit. Collateral in excess of these borrowings represents the Company’s maximum loss exposure. Initial Direct Costs and Fees We defer initial direct costs incurred and fees received to originate our leases and loans . The initial direct costs and fees we defer are part of the net investment in leases and loans and are amortized to interest income using the effective interest method. The January 1, 2019 adoption of ASU 2016-02, Leases , includes provisions that limit th e types of direct lease origination costs that may be deferred, which may reduce prospective deferred lease origination costs on a unit basis. For leases originated in 2019, the costs deferred are limited to internal commissions and third party commissions . For loans, including both equipment finance loans and working capital loans, and for leases originated in 2018 and prior, we defer third-party commission costs, as well as certain internal costs directly related to successful origination activity , including compensation and certain general and administrative costs . Costs subject to deferral include evaluating each prospective customer’s financial condition, evaluating and recording guarantees and other security arrangements, negotiating terms, prepa ring and processing documents and closing each transaction. The fees we defer are documentation fees collected at inception. The realization of the initial direct costs, net of fees deferred, is predicated on the net future cash flows generated by our lea se and loan portfolios. Stock-Based Compensation The Compensation—Stock Compensation Topic of the FASB ASC establishes fair value as the measurement objective in accounting for share-based payment arrangements and requires all entities to apply a fair-v alue-based measurement method in accounting for share-based payment transactions with employees and non-employees, except for equity instruments held by employee share ownership plans. The Company measures stock-based compensation cost at grant date, bas ed on the fair value of the awards ultimately expected to vest. Stock-based compensation expense is recognized on a straight-line basis over the service period. We generally use the Black-Scholes valuation model to measure the fair value of our stock optio ns and the Monte Carlo simulation valuation model to measure the fair value of our restricted stock units utilizing various assumptions with respect to expected holding period, risk-free interest rates, stock price volatility, and dividend yield. The assum ptions are based on management’s judgment concerning future events. The Company uses its judgment in estimating the amount of awards that are expected to be forfeited, with subsequent revisions to the assumptions if actual forfeitures differ from those estimates. The vesting of certain restricted shares may be accelerated to a minimum of three years based on achievement of various individual performance measures. Acceleration of expense for awards based on individual performance factors occurs when the achievement of the performance criteria is determined. Non-forfeitable dividends paid on shares of restricted stock are recorded to retained earnings for shares that are expected to vest and to compensation expense for shares that are not expected to vest. Income Taxes The Company is subject to the income tax laws of the v arious jurisdictions in which it operates, including U.S. federal, state and local jurisdictions. A consolidated federal income tax return is filed. Depending upon the jurisdiction, the Company files consolidated or separate legal entity state income tax returns. Current tax expense represents the amount of taxes currently payable to or receivable from a taxing authority plus amounts accrued for income tax contingencies (including tax, penalty and interest). Deferred tax expense generally represents the net change in the deferred tax asset or liability balance during the year plus any change in the valuation allowance, excluding any changes in amounts recorded in Additional paid-in capital or Accumulated other comprehensive income (loss) in the Consolida ted Balance Sheets. Deferred income taxes are determined using the balance sheet method. Recognition of deferred taxes is based on the expected future tax consequences of temporary differences between the carrying amounts of assets or liabilities for book and tax purposes using the current enacted tax rates; however, deferred tax assets are reduced by valuation allowances if it is more likely than not that some portion of the deferred tax asset will not be realized. We evaluate our deferred tax assets quarterly to determine if adjustments to our valuation allowance are required based on the consideration of all available evidence, using a "more likely than not" standard with respect to whether deferred tax assets will be realized . The ultimate reali zation of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. In making this assessment, management considers the scheduled reversal of deferred tax liabil ities and projected future taxable income, the level of historical taxable income, projections for future taxable income over the periods which the deferred tax assets are deductible and available tax planning strategies. Should a change in circumstances, including differences between our future operating results and estimates, lead to a change in our judgments about the realization of deferred tax assets in future years, we would adjust the valuation allowances in the period that the change in circumstanc es occurs, along with a charge or credit to income tax expense . The Company records penalties and accrued interest related to taxes in income tax expense. Uncertain tax positions (including interest and penalties) are recognized when we believe it is mor e likely than not that the tax position will be upheld on examination by the taxing authorities based on merits of the position. As of December 31, 2019 and 2018 , there are no unrecognized tax positions. Earnings Per Share The Company’s restricted stock awards are paid non-forfeitable common stock dividends and thus meet the criteria of participating securities. Accordingly, earnings per share (“EPS”) is calculated using the two-class method, under which earnings are allocated to both com mon shares and participating securities. All shares of restricted stock are deducted from the weighted average shares outstanding for the computation of basic EPS. Diluted EPS is computed based on the weighted average number of common shares outstanding for the period including the dilutive impact of the exercise or conversion of common stock equivalents, such as stock options, into shares of common stock as if those securities were exercised or converted. Insurance Program Deferred Acquisition Costs Deferred acquisitions costs represent the fees paid to a third-party insurance company. For the years ended December 31, 2019 , 2018 , and 2017 , the Company recognized deferred acquisition costs and premium taxes of $ 1.0 million, $ 0.9 million , and $ 0. 9 million, respectively. Since the policy’s premiums are recognized on a month to month basis, there is no deferred acquisition costs on the Consolidated Balance Sheet as these are fully recognized through the Consolidated Statements of Operations in the month written. Provision for Unpaid Losses and Loss Adjustment Expenses The Company records a provision for insurance losses and loss adjustment expenses. The liability for losses and loss adjustment expenses includes an amount determined from los s reports and individual cases and an amount, based on historical loss experience and industry statistics, for losses incurred but not reported (“IBNR”). These estimates are continually reviewed and are subject to the impact of future changes in such fact ors as claim severity and frequency. Loss and loss expenses are paid when advised by the third-party insurance company. Outstanding losses comprise estimates of the amount of reported losses and loss expenses received from the third-party insurance compa ny plus a provision for losses IBNR. IBNR is determined with the assistance of a third-party actuary. For the years ended December 31, 2019 , 2018 , and 2017 , the Company recognized provision for unpaid losses and loss adjustment expenses of $ 0 .6 million, $ 0.8 million, and $ 0 .8 million, respectively. Recently Issued Accounting Standards Income Taxes. In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes , which removes certain exceptions to the general principles of ASC 740 in order to reduce the cost and complexity of its application. Among other changes, the ASU simplifies intraperiod allocation, removes exceptions related to outside basis differences with respect to accounting for equity method investments and revises certain exceptions related to accounting for year-to-date losses in interim periods. The ASU is effective for fiscal years beginning after December 15, 2020, with early adoption permitte d. The Company has not determined the impact the adoption of this new requirement will have on its financial statements. Fair Value. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Di sclosure Requirements for Fair Value Measurement which modifies the disclosures on fair value measurements by removing the requirement to disclose the amount and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, the policy for timing of such transfers and the valuation process for Level 3 fair value measurements. The ASU expands the disclosure requirements for Level 3 fair value measurements, primarily focused on changes in unrealized gains and losses included in other comprehen sive income. The ASU is effective for fiscal years beginning after December 15, 2019, with early adoption permitted. The adoption of this new requirement will impact only footnote disclosure and will not impact the Company’s consolidated earnings, financia l position or cash flows. Intangibles - Goodwill. In August 2018, the FASB issued ASU 2018-15, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud |
Non-Interest Income
Non-Interest Income | 12 Months Ended |
Dec. 31, 2019 | |
Noninterest Income [Abstract] | |
Noninterest Income [Text Block] | NOTE 3 – Non-Interest Income The following table summarizes the Company’s non-interest income for the periods presented: Year Ended December 31, 2019 2018 2017 (Dollars in thousands) Gain on sale of leases and loans $ 22,210 $ 8,363 $ 2,818 Insurance premiums written and earned 8,796 8,087 7,155 Other income: Servicing income 1,526 653 864 Property tax income (1) 6,401 — — Net gains and (losses) recognized during the period on equity securities 104 (75) — Non-interest income within the scope of other GAAP topics 39,037 17,028 10,837 Other income: Property tax administrative fees on leases 1,076 740 751 ACH payment fees 316 333 326 Insurance policy fees 2,706 2,124 1,846 Referral fees 543 839 2,518 Other 353 370 454 Non-interest income from contracts with customers (ASC 606) 4,994 4,406 5,895 Total non-interest income $ 44,031 $ 21,434 $ 16,732 __________________ (1) After the January 1, 2019 adoption of ASU 2016-02, Leases , for the year ended December 31, 2019 the Company is recording property tax income and expense gross in the Consolidated Statements of Operations. For 2018 and 2017, the Company had recognized these amounts net within General and administrative expense i n the Consolidated Statements of Operations. |
Investments Securities
Investments Securities | 12 Months Ended |
Dec. 31, 2019 | |
Investment Securities [Abstract] | |
Investment Securities | Note 4 – Investment Securities The Company has the following investment securities as of the periods presented December 31, 2019 2018 (Dollars in thousands) Equity Securities Mutual fund $ 3,615 $ 3,429 Debt Securities, Available for Sale: Asset-backed securities ("ABS") 4,332 4,915 Municipal securities 3,129 2,612 Total investment securities $ 11,076 $ 10,956 Equity Securities The following schedule summarizes changes in fair value of Equity securities and the portion of unrealized gains and losses for each period presented : Year Ended December 31, 2019 (1) 2018 (1) 2017 (2) (Dollars in thousands) Net gains and (losses) recognized during the period on equity securities $ 104 $ (75) $ — Less: Net gains and (losses) recognized during the period on equity securities sold during the period — — — Unrealized gains and (losses) recognized during the reporting period on equity securities still held at the reporting date $ 104 $ (75) $ — __________________ (1) After adoption of ASU 2016-01 on January 1, 2018, unrealized gains and losses of equity securities classified as available for sale are recorded through the Consolidated Statement of Operations. (2) Prior to adoption of ASU 2016-01, unrealized gains and losses of equity securities classified as available for sale were reported in other comprehensive income (loss). Available for Sale The following schedule is a summary of available for sale investments for the periods presented: December 31, 2019 Gross Gross Amortized Unrealized Unrealized Estimated Cost Gains Losses Fair Value (Dollars in thousands) ABS $ 4,302 $ 33 $ (3) $ 4,332 Municipal securities 3,058 71 — 3,129 Total Debt Securities, Available for Sale $ 7,360 $ 104 $ (3) $ 7,461 December 31, 2018 Gross Gross Amortized Unrealized Unrealized Estimated Cost Gains Losses Fair Value (Dollars in thousands) ABS $ 4,934 $ 20 $ (39) $ 4,915 Municipal securities 2,629 3 (20) 2,612 Total Debt Securities, Available for Sale $ 7,563 $ 23 $ (59) $ 7,527 The Company evaluates its available for sale securities in an unrealized loss position for other than temporary impairment on at least a quarterly basis. The Company did not recognize any other than temporary impairment to earnings for each of the years ended December 31, 2019 and December 31, 2018 . The following tables present the aggregate amount of unrealized losses on available for sale securities in the Company’s investment securities classified according to the amount of time those securities have been in a continuous loss posi tion as of December 31, 2019 and December 31, 2018 : December 31, 2019 Less than 12 months 12 months or longer Total Gross Gross Gross Unrealized Fair Unrealized Fair Unrealized Fair Losses Value Losses Value Losses Value (Dollars in thousands) ABS $ — $ — $ (3) $ 430 $ (3) $ 430 Total available for sale investment securities $ — $ — $ (3) $ 430 $ (3) $ 430 December 31, 2018 Less than 12 months 12 months or longer Total Gross Gross Gross Unrealized Fair Unrealized Fair Unrealized Fair Losses Value Losses Value Losses Value (Dollars in thousands) ABS $ — $ — $ (39) $ 3,340 $ (39) $ 3,340 Municipal securities (16) 1,436 (4) 408 (20) 1,844 Total available for sale investment securities $ (16) $ 1,436 $ (43) $ 3,748 $ (59) $ 5,184 Based on current facts and circumstances, the Company believes the unrealized losses presented in the December 31, 2019 securities in a gross unrealized loss position in the table above are not indicative of the ultimate collectability of the current amortized cost of the securities, but rather are attributable to changes in interest rates, credit spreads and other factors. The following table presents the amortized cost, fair value, and weighted average yield of available for sale investments at December 31, 2019 , based on estimated average life. Receipt of cash fl ows may differ from those estimated maturities because borrowers may have the right to call or prepay obligations with or without penalties: Distribution of Maturities 1 Year Over 1 to Over 5 to Over or Less 5 Years 10 Years 10 Years Total (Dollars in thousands) Amortized Cost: ABS $ — $ 2,522 $ 1,780 $ — $ 4,302 Municipal securities 15 449 1,594 1,000 3,058 Total available for sale investments $ 15 $ 2,971 $ 3,374 $ 1,000 $ 7,360 Estimated fair value $ 15 $ 2,998 $ 3,448 $ 1,000 $ 7,461 Weighted-average yield, GAAP basis 4.75% 2.29% 2.85% 2.60% 2.44% |
Net Investment in Leases and Lo
Net Investment in Leases and Loans | 12 Months Ended |
Dec. 31, 2019 | |
Net Investment in Leases and Loans [Abstract] | |
Net Investment in Leases and Loans | NOTE 5 - Net Investment in Leases and Loans Net investment in leases and loans consists of the following: December 31, 2019 2018 (Dollars in thousands) Minimum lease payments receivable $ 457,602 $ 530,867 Estimated residual value of equipment 29,342 27,646 Unearned lease income, net of initial direct costs and fees deferred (59,746) (68,376) Security deposits (590) (838) Total leases 426,608 489,299 Commercial loans, net of origination costs and fees deferred Working Capital Loans 60,942 36,856 CRA (1) 1,398 1,466 Equipment loans (2) 464,655 423,168 CVG 74,612 66,051 Total commercial loans 601,607 527,541 Allowance for credit losses (21,695) (16,100) $ 1,006,520 $ 1,000,740 __________________ (1) CRA loans are comprised of loans originated under a line of credit to satisfy its obligations under the Community Reinvestment Act of 1977. (2) Equipment loans are comprised of Equipment Finance Agreements, Install Purchase Agreements, and other loans. At December 31, 2019 , $ 76 .1 million in net investment in leases are pledged as collateral for the company’s outstanding asset-backed securitization balance and $ 35.6 million in net investment in leases are pledged as collateral for the secured borrowing capacity at the Federal Reserve Discount Window. Initial direct costs and origination costs net of fees deferred were $ 20.5 million as of December 31, 2019 and December 31, 2018 . Initial direct costs are netted in unearned income and are amortized to income using the effective interest method. Origination costs are netted in commercial loans and are amortized to income using the effective interest method. At December 31, 2019 and December 31, 2018 , $ 23.4 million and $ 23.6 million, respectively, of the estimated residual value of equipment retained on our Consolidated Balance Sheets was related to copiers. Minimum lease payments receivable under lease contracts and the amortization of unearned lease income, includin g initial direct costs and fees deferred, are as follows as of December 31, 2019 : Minimum Lease Payments Income Receivable (1) Amortization (2) (Dollars in thousands) Period Ending December 31, 2020 $ 183,266 $ 29,961 2021 130,656 16,950 2022 82,316 8,454 2023 43,390 3,361 2024 15,768 805 Thereafter 2,206 215 $ 457,602 $ 59,746 ________________________ (1) Represents the undiscounted cash flows of the lease payments receivable. (2) Represents the difference between the undiscounted cash flows and the discounted cash flows. The lease income recognized was as follows : Year Ended December 31, 2019 2018 2017 (Dollars in thousands) Interest Income $ 41,891 $ 48,914 $ 56,428 As of December 31, 2019 and December 31, 2018 , the Company maintained total finance receivables which were on a non-accrual basis of $ 6.4 million and $ 4.2 million, respectively . As of December 31, 2019 and December 31, 2018 , the Company had total finance receivables in which the terms of the original agreements had been renegotiated in the amount of $2.9 million and $3.6 million, respectively. (See Note 7 for additional asset qua lity information) Portfolio Sales The Company originates certain lease and loans for sale to third parties, based on their underwriting criteria and specifications. In addition, the Company may periodically enter into agreements to sell certain leases and loans that were originated for investment to third parties. For agreements that qualify as a sale where the Company has continuing involvement through servicing, the Company recognizes a servicing liability at its initial fair value, and then amortizes the l iability over the expected servicing period based on the effective yield method, within Other income in the Consolidated Statements of Operations. The Company’s sale agreements typically do not contain a stated servicing fee, so the initial value recognized as a servicing liability is a reduction of the proceeds received and is based on an estimate of the fair value attributable to that obligation. The Company’s servicing liability is $ 2.5 million and $ 1.4 million as of December 31, 2019 and 2018, respect ively, and is recognized within Accounts payable and accrued expenses in the Consolidated Balance Sheets. As of December 31, 2019, the portfolio of leases and loans serviced for others was approximately $ 340 million. In addition, the Company may have con tinuing involvement in contracts sold through any recourse obligations that may include customary representations and warranties or specific recourse provisions. The Company’s expected losses from recourse obligations is not significant as of December 31, 2019. The following table summarizes information related to portfolio sales for the periods presented: Year Ended December 31, 2019 2018 2017 (Dollars in thousands) Sales of leases and loans $ 310,415 $ 138,995 $ 66,744 Gain on sale of leases and loans 22,206 8,364 2,818 |
Concentrations of Risk
Concentrations of Risk | 12 Months Ended |
Dec. 31, 2019 | |
Concentrations of Risk [Abstract] | |
Concentrations of Risk | NOTE 6 - Concentrations of Risk As of December 31, 2019 and 2018 , leases approximating 14% , 12% and 10% of the net investment balance of leases by the Company were located in the states of California , Texas and Florida . No other state accounted for more than 7% of the net investment balance of leases owned and serviced by the Company as of December 31, 2019 and December 31, 2018 . As of December 31, 2019 and December 31, 2018 , no single vendor source accounted for more than 4% of the net investment balance of leases owned by the Company. The largest single obligor accounted for less than 1% o f the net investment balance of leases owned by the Company as of December 31, 2019 and December 31, 2018 . Although the Company’s portfolio of leases includes lessees located throughout the United States , such lessees’ ability to honor their contracts may be subst antially dependent on economic conditions in these states. All such contracts are collateralized by the related equipment. The Company leases to a variety of different industries, including the medical, retail, service, manufacturing and restaurant industr ies, among others. To the extent that the economic or regulatory conditions prevalent in such industries change, the lessees’ ability to honor their lease obligations may be adversely impacted. As of December 31, 2019 and December 31, 2018 , copiers comprised 79.7% and 85.4 % , respectively, of the estimated residual value of leased equipment. No other group of equipment represented more than 10% of equipment residuals as of December 31, 2019 and December 31, 2018 . Improvements and other c hanges in technology could adversely impact the Company’s ability to realize the recorded value of this equipment. There were no impairments of estimated residual value recorded during the years ended December 31, 2019 , 2018 or 2017 . |
Allowance for Credit Losses
Allowance for Credit Losses | 12 Months Ended |
Dec. 31, 2019 | |
Allowance For Credit Losses [Abstract] | |
Allowance For Credit Losses | NOTE 7 - Allowance for Credit Losses In accordance with the Contingencies Topic of the FASB ASC, w e maintain an allowance for credit losses at an amount sufficient to absorb losses inherent in our existing lease and loan portfolios as of the reporting dates based on our estimate of probable net credit losses. The Company adopted ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit L osses on Financial Instruments, which changed our accounting policy and estimated allowance, effective January 1, 2020. See further discussion in Note 2 , Summary of Significant Accounting Policies . The following tables provides activity in the allowa nce for credit losses and asset quality statistics for each of the years ended December 31, 2019 , 2018 and 2017 . December 31, 2019 Commercial Leases and Loans (Dollars in thousands) Working Capital Loans CRA Equipment Finance (2) CVG Total Allowance for credit losses, beginning of period $ 1,467 $ — $ 13,531 $ 1,102 $ 16,100 Charge-offs (2,868) — (20,328) (1,875) (25,071) Recoveries 337 — 2,164 129 2,630 Net charge-offs (2,531) — (18,164) (1,746) (22,441) Provision for credit losses 2,963 — 22,967 2,106 28,036 Allowance for credit losses, end of period $ 1,899 $ — $ 18,334 $ 1,462 $ 21,695 Ending lease or loan balance (1) $ 60,412 $ 1,398 $ 863,533 $ 82,363 $ 1,007,706 Ending balance: individually evaluated for impairment (3) $ — $ — $ — $ — $ — December 31, 2018 Commercial Leases and Loans (Dollars in thousands) Working Capital Loans CRA Equipment Finance (2) CVG Total Allowance for credit losses, beginning of period $ 1,036 $ — $ 12,663 $ 1,152 $ 14,851 Charge-offs (1,537) — (18,149) (907) (20,593) Recoveries 60 — 2,199 61 2,320 Net charge-offs (1,477) — (15,950) (846) (18,273) Provision for credit losses 1,908 — 16,818 796 19,522 Allowance for credit losses, end of period $ 1,467 $ — $ 13,531 $ 1,102 $ 16,100 Ending lease or loan balance (1) $ 36,478 $ 1,466 $ 890,785 $ 67,654 $ 996,383 Ending balance: individually evaluated for impairment (3) $ — $ — $ — $ — $ — December 31, 2017 Commercial Leases and Loans (Dollars in thousands) Working Capital Loans CRA Equipment Finance (2) CVG Total Allowance for credit losses, beginning of period $ 760 $ — $ 9,808 $ 369 $ 10,937 Charge-offs (1,219) — (14,343) (1,154) (16,716) Recoveries 121 — 2,066 49 2,236 Net charge-offs (1,098) — (12,277) (1,105) (14,480) Provision for credit losses 1,374 — 15,132 1,888 18,394 Allowance for credit losses, end of period $ 1,036 $ — $ 12,663 $ 1,152 $ 14,851 Ending lease or loan balance (1,3) $ 27,810 $ 1,222 $ 826,880 $ 55,330 $ 911,242 __________________ (1) For purposes of asset quality and allowance calculations, the effects of (i) the allowance for credit losses and (ii) initial direct costs and fees deferred are excluded. (2 ) Equipment Finance consists of Equipment Finance Agreements, Install Purchase Agreements, and other leases and loans. (3) As of December 31, 2019 and December 31, 2018 , the Company determined that n o leases or loans required individual evaluation, and as of December 31, 2017 all leases and loans were collectively evaluated. Credit Quality Indicators The Company’s credit review process includes a risk classification of all leases and loans that includes pass, special mention, substandard, doubtful, and loss. The classification of a lease or loan may change based on changes in the creditworthiness of th e borrower. The description of the risk classifications are as follows: Pass: A lease or loan is classified as pass when payments are current, it is performing under the original contractual terms, and it does not meet any of the descriptions below. Speci al Mention: A lease or loan is classified as special mention when the borrower exhibits potential credit weakness or a downward trend which, if not checked or corrected, will weaken the asset or inadequately protect the Company’s position. While potentiall y weak, the borrower is currently marginally acceptable; no loss of principal or interest is envisioned. Substandard: A lease or loan is classified as substandard when the borrower has a well-defined weakness or weaknesses that jeopardize the orderly liqu idation of the debt. A substandard loan is inadequately protected by the current net worth and paying capacity of the obligor, normal repayment from this borrower is in jeopardy, and there is a distinct possibility that a partial loss of interest and/or pr incipal will occur if the deficiencies are not corrected. Doubtful: A lease or loan is classified as doubtful when a borrower has all weaknesses inherent in a loan classified as substandard with the added provision that: (1) the weaknesses make collection of debt in full on the basis of currently existing facts, conditions and values highly questionable and improbable; (2) serious problems exist to the point where a partial loss of principal is likely; and (3) the possibility of loss is extremely high, but because of certain important, reasonably specific pending factors which may work to the advantage and strengthening of the assets, its classification as an estimated loss is deferred until its more exact status may be determined. Pending factors include p roposed merger, acquisition, or liquidation procedures, capital injection, perfecting liens and additional refinancing plans. Loss: A lease or loan is classified as loss when uncollectible and of such little value that its continuance as a bankable asset is not warranted. This classification does not mean that the loan has absolutely no recovery or salvage value but rather that it is not practical or desirable to defer writing off this basically worthless asset even though partial recovery may be effected in the future. Equipment Finance leases are placed in non-accrual status when they are 90 days past due or earlier if collection of principal or interest is considered doubtful and Working Capital Loans are placed in non-accrual status when they are 30 da ys past due and charged-off at 60 days past due. The following tables present the segments of the loan portfolio in which a formal risk weighting system is utilized summarized by the categories of “pass” and “special mention”, and the classified categori es of “substandard”, “doubtful”, and “loss” within the Bank’s risk rating system at December 31, 2019 and December 31, 2018 . The data within the tables reflect net investment, excluding deferred fees and cost and allowance : December 31, 2019 Commercial Leases and Loans (Dollars in thousands) Working Capital Loans CRA Equipment Finance CVG Total Pass $ 59,081 $ 1,398 $ 849,605 $ 80,484 $ 990,568 Special Mention 143 — 5,164 318 5,625 Substandard 242 — 3,528 957 4,727 Doubtful 674 — 2,857 224 3,755 Loss 272 — 2,378 378 3,028 Total $ 60,412 $ 1,398 $ 863,532 $ 82,361 $ 1,007,703 December 31, 2018 Commercial Leases and Loans (Dollars in thousands) Working Capital Loans CRA Equipment Finance CVG Total Pass $ 35,793 $ 1,466 $ 879,275 $ 66,463 $ 982,997 Special Mention 47 — 4,373 146 4,566 Substandard 145 — 3,460 660 4,265 Doubtful 300 — 2,353 158 2,811 Loss 193 — 1,324 227 1,744 Total $ 36,478 $ 1,466 $ 890,785 $ 67,654 $ 996,383 Loan Delinquencies and Non-A ccrual Leases and Loans Net investments in leases and loans are generally charged-off when they are contractually past due for 120 days or more. Income recognition is discontinued on leases or loans when a default on monthly payment exists for a period of 90 days or more. Income recognition resumes when a lease or loan becomes less than 90 days delinquent. At December 31, 2019 and December 31, 2018 , there were no finance receivables past due 90 days or more and still accruing. Working Capital Loans are generally placed in non-accrual status when they are 30 days past due and charged-off at 60 days past due . The loan is removed from non-accrual status once sufficient payments are made to bring the loan current and reviewed by managemen t. There were no Working Capital Loans past due 30 days or more and still accruing. Management further monitors the performance and credit quality of the loan portfolio as determined by the length of time a recorded payment is due. The following tables provide information about delinquent and non-accrual leases and loans in the Company’s portfolio each of the years ended December 31, 2019 and December 31, 2018 . 30-59 60-89 >90 Days Days Days Total Total December 31, 2019 Past Past Past Past Finance Non- (Dollars in thousands) Due Due Due Due Current Receivables Accruing Commercial Loans: Working Capital Loans $ 584 $ 68 $ 203 $ 855 $ 59,557 $ 60,412 $ 946 CRA — — — — 1,398 1,398 — Equipment Finance (1) 5,399 3,705 5,006 14,110 969,761 983,871 5,006 CVG 406 271 435 1,112 94,344 95,456 435 Total Leases and Loans (2) $ 6,389 $ 4,044 $ 5,644 $ 16,077 $ 1,125,060 $ 1,141,137 $ 6,387 30-59 60-89 >90 Days Days Days Total Total December 31, 2018 Past Past Past Past Finance Non- (Dollars in thousands) Due Due Due Due Current Receivables Accruing Commercial Loans: Working Capital Loans $ 300 $ 51 $ 141 $ 492 $ 35,986 $ 36,478 $ 492 CRA — — — — 1,466 1,466 — Equipment Finance (1) 4,537 3,123 3,529 11,189 1,001,363 1,012,552 3,529 CVG 166 257 191 614 78,407 79,021 191 Total Leases and Loans (2) $ 5,003 $ 3,431 $ 3,861 $ 12,295 $ 1,117,222 $ 1,129,517 $ 4,212 __________________ (1 ) Equipment Finance consists of Equipment Finance Agreements, Install Purchase Agreements, and other leases and loans. (2) Represents total minimum lease and loan payments receivable for Equipment Finance and CVG and as a percentage of principal outstanding for Working Capital Loans and CRA. For information on the Company’s loan sales activity, see Note 5 , Net Investment in Leases and Loans . |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets Disclosure | NOTE 8 - Goodwill and Intangible Assets Goodwill The Company’s goodwill balance of $ 7.4 million at December 31, 2018 included $ 1.2 million from the Company’s acquisition of Horizon Keystone Financial, an equipment company (‘HKF”), in January 2017, and $ 6.2 million from the preliminary allocation of the purchase price of the Company’s acquisition of FFR in September 2018. The Company completed the purchase price allocation in the first quarter of 2019 upon receiving clarification of certain out standing matters and established a final goodwill valuation of $ 5.6 million resulting in a goodwill reduction of $ 0.6 million in the first quarter of 2019. The goodwill balance represents the excess purchase price over the Company’s fair value of the asset s acquired and is not amortizable but is deductible for tax purposes. Impairment testing will be performed in the fourth quarter of each year and more frequently as warranted in accordance with the applicable accounting guidance . There was no impairment re corded during the twelve-month period ended December 31, 2019 . The changes in the carrying amount of goodwill for the twelve-month period ended December 31, 2019 are as follows: (Dollars in thousands) Total Company Balance at December 31, 2018 $ 7,360 Changes (625) Balance at December 31, 2019 $ 6,735 Intangible assets During the first quarter of 2017, in connection with the acquisition of HKF, the Company acquired certain definite-lived intangible assets with a total cost of $ 1.3 million and a weighted average amortization period of 8.7 years. During the third quarter of 2018, in connection with the acquisition of FFR, the Company acquired certain definite-lived intangible assets with a total cost of $ 7.2 million based on a preliminary evaluation. The Company subsequently completed the purchase price a llocation in the first quarter of 2019 and established a cost of $ 7.6 million for the acquired intangible assets and a weighted average amortization period of 10.8 years . The Company had no indefinite-lived intangible assets at December 31, 2019 . The followin g table presents details of the Company’s intangible assets: Gross Carrying Accumulated Net Book Useful Life Amount Amortization Value As of December 31, 2019 (Dollars in thousands) Lender relationships 3 to 10 years $ 1,630 $ 519 $ 1,111 Vendor relationships 11 years 7,290 974 6,316 Corporate trade name 7 years 60 26 34 Total $ 8,980 $ 1,519 $ 7,461 As of December 31, 2018 Lender relationships 3 to 10 years $ 1,590 $ 271 $ 1,319 Vendor relationships 11 years 6,852 302 6,550 Corporate trade name 7 years 60 17 43 Total $ 8,502 $ 590 $ 7,912 There was no impairment of these assets in 2019 or 2018. Amortization related to the Company’s definite lived intangible assets was $ 0 .9 million and $ 0 .4 million for the twelve-month periods ended December 31, 2019 and December 31, 2018 , respectively . The Company expects the amortization expense for the next five years will be as follows: (Dollars in thousands) Amortization Expense 2020 $ 798 2021 798 2022 798 2023 798 2024 790 |
Property and Equipment, Net
Property and Equipment, Net | 12 Months Ended |
Dec. 31, 2019 | |
Property and Equipment, Net [Abstract] | |
Property and Equipment Disclosure | NOTE 9 - Property and Equipment, N et Property and equipment , net consist of the following: December 31, 2019 2018 Depreciable Life (Dollars in thousands) Furniture and equipment $ 4,035 $ 2,986 7 years Computer systems and equipment 18,584 17,234 3-5 years Leasehold improvements 3,552 1,197 Shorter of estimated useful life or remaining lease term Total property and equipment 26,171 21,417 Less - Accumulated depreciation and amortization (18,283) (17,100) Property and equipment, net $ 7,888 $ 4,317 Depreciation and amortization expense was $1.8 million, $1.6 million and $1.5 million for each of the years ended December 31, 2019 , 2018 and 2017 , respectively. |
Other Assets
Other Assets | 12 Months Ended |
Dec. 31, 2019 | |
Other Assets [Abstract] | |
Other Assets | NOTE 10 - Other Assets Other assets are comprised of the following: December 31, 2019 2018 (Dollars in thousands) Accrued fees receivable $ 3,509 $ 3,354 Prepaid expenses 2,872 2,447 Federal Reserve bank stock 1,711 1,711 Other 2,361 2,144 $ 10,453 $ 9,656 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Lessee, Operating Leases [Text Block] | NOTE 11 – Leases The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets and operating lease liabilities on our consolidated balance sheets. ROU assets and operating lease liabilities are recognized based on the present value of the future lease payments over the lease term at commencement date. As most of our leases do not provide an implicit rate, in order to determine the present value of future payments f or office leases we use an incremental borrowing rate based on the information available through real estate databases for similar locations and for the present value of future payments for equipment leases we use the average rate of our term note securiti zation which is collateralized by similar equipment. The ROU asset also includes any lease payments made and excludes lease incentives. Our lease terms may include options to extend when it is reasonably certain that we will exercise that option. Lease exp ense for minimum lease payments is recognized on a straight-line basis over the lease term. As of December 31, 2019 , the Company leases all six of its office locations including its executive offices in Mt. Laurel, New Jersey, and its offices in or near Salt Lake City, Utah; Portsmouth, New Hampshire; Highlands Ranch, Colorado; Corona, California; and Philadelphia, Pennsylvania. The Company has elected not to recognize ROU assets and lease liabilities for two office leases whose terms are twelve months or less and are considered short-term leases. Four of the office leases include options to extend for terms of three to ten years. These options have not been recognized as part of our ROU assets and lease liabilities as the Company is not reasonably certain to e xercise these options. The Company has also entered into three leases for office equipment for which ROU assets and lease liabilities have been recognized. All the aforementioned leases have been accounted for as operating leases. The components of lease expense were as follows: Year Ended December 31, 2019 2018 2017 (Dollars in thousands) Operating lease cost $ 1,201 $ 1,131 $ 1,062 Finance lease costs — 7 5 Short-term lease cost 368 — — Total lease cost $ 1,569 $ 1,138 $ 1,067 The Company adopted ASU 2016-02, Leases , on January 1, 2019, which requires the Company to recognize right-of-use assets and lease liabilities on its balance sheets , as further discussed in Note 2, Summary of Significant Accounting Policies. As of December 31, 2019, right-of-use assets and lease liabilities recognized on the Balance sheet were $ 8,863 and $ 9,730 , respectively. Other information related to the Company’s leases follows: As of December 31, 2019 Weighted average remaining lease term 11.3 years Weighted average discount rate 3.30 % Year Ended December 31, 2019 (Dollars in thousands) Cash payments for operating lease liabilities, included in operating cash flows $ 424 Right-of-use assets obtained in exchange for new operating lease obligations 756 Maturities of lease liabilities were as follows: Operating Leases Period Ending December 31, (Dollars in thousands) 2020 $ 1,288 2021 1,081 2022 992 2023 914 2024 896 Thereafter 6,557 Total lease payments $ 11,728 Less: imputed interest (1,998) Total $ 9,730 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies [Abstract] | |
Commitments And Contingencies | NOTE 12 - Commitments and Contingencies MBB is a member bank in a non-profit, multi-financial institution Community Development Financial Institution (“CDFI”) organization. The CDFI serves as a catalyst for community development by offering flexible financing for affordable, quality housing to l ow- and moderate-income residents, helping MBB meet its Community Reinvestment Act (“CRA”) obligations. Currently, MBB receives a range of approximately 0.8 % to 1.2 % participation in each funded loan which is collateral for the loan issued to the CDFI unde r the program. MBB records loans in its financial statements when they have been funded or become payable. Such loans help MBB satisfy its obligations under the Community Reinvestment Act of 1977. At December 31, 2019 and December 31, 2018 , MBB had an unfunded com mitment of $0.6 million and $0.5 million, respectively, for this activity. MBB’s one-year commitment to the CDFI will expire in September 2020 at which time the commitment may be renewed for another year based on the Company’s discretion. The Company is involved in legal proceedings, which include claims, litigation and suits arising in the ordinary course of business. In the opinion of management, these actions will not have a material effect on the Company’s consolidated financial position, results of o perations or cash flows. Banking institutions are subject to periodic reviews and examinations from banking regulators. In 2017, one of MBB’s regulatory agencies communicated findings in connection with the timing of certain aspects of payment application processes in effect prior to February 2016 related to the assessment of late fees. The Company agreed to pay restitution to customers in the amount $ 4.0 million to resolve this matter, and the Company established a liability for such amount in the first q uarter of 2017. In the second quarter of 2019, the Company remitted the $ 4.0 million into a fund that is processing the restitution and will resolve its obligation for this matter. |
Deposits
Deposits | 12 Months Ended |
Dec. 31, 2019 | |
Deposits [Abstract] | |
Deposits | NOTE 13 - Deposits MBB serves as the Company’s primary funding source. MBB issues fixed-rate FDIC-insured certificates of deposit raised nationally through various brokered deposit relationships and fixed-rate FDIC-insured deposits received from direct sources. MBB offers FDIC-insured money market deposit accounts (the “MMDA Product”) through participation in a partner bank’s insured savings account product. This brokered deposit product has a variable rate, no maturity date and is offered to the clients of the partner bank and recorded as a single deposit account at MBB. As of December 31, 2019 , money market deposit accounts totaled $ 23.4 million. As of December 31, 2019 , the remaining scheduled maturities of certificates of deposits are as follow s: Scheduled Maturities (Dollars in thousands) Period Ending December 31, 2020 $ 388,615 2021 216,157 2022 118,792 2023 60,640 2024 31,515 $ 815,719 Certificates of deposits issued by MBB are time deposits and are generally issued in denominations of $ 250,000 or less. The MMDA Product is also issued to customers in amounts less than $250,000. The FDIC insures deposits up to $250,000 per depositor. The weighted average all-in interest rate of deposits outstanding at December 31, 2019 was 2.40% . |
Long-term Borrowings
Long-term Borrowings | 12 Months Ended |
Dec. 31, 2019 | |
Long-term Debt, Unclassified [Abstract] | |
Long-term Borrowings | NOTE 14 – Debt and Financing Arrangements Short -Term Borrowings On November 20, 2018, the Company closed on a secured, variable rate revolving line of credit in the amount of $ 5.0 million, which was renewed in 2019 and is due on November 20, 2020 . As of December 31, 2019 the Company was in compliance with all debt covenants required under this line of credit and there were no outstanding balances on this line of credit as of December 31, 2019 and 2018 . Long-Term Borrowings Borrowings with an original maturity date of one year or more are classified as long-term borrowings. The Company’s term note securitizations are classified as long-term borrowings. The Company’s long-term borrowings consisted of the following: December 31, 2019 2018 (Dollars in thousands) Term securitization 2018-1 $ 76,563 $ 151,233 Unamortized debt issuance costs (472) (1,178) $ 76,091 $ 150,055 On July 27, 2018 the Company completed a $ 201.7 million asset-backed term securitization. Each tranche of the term note securitization has a fixed term, fixed interest rate and fixed principal amount. At December 31, 2019 , outstanding term securitizations amounted to $ 76.6 million and are collateralized by $ 84.6 million of minimum lease and loan payments receivable and $6.9 million of restricted interest-earning deposits. The July 27, 2018 term note securitization is summariz ed below: Outstanding Notes Balance Final Original Originally as of Maturity Coupon Issued December 31, 2019 Date Rate (Dollars in thousands) 2018 — 1 Class A-1 $ 77,400 $ — July 2019 2.55 % Class A-2 55,700 $8,013 October 2020 3.05 Class A-3 36,910 $36,910 April 2023 3.36 Class B 10,400 $10,400 May 2023 3.54 Class C 11,390 $11,390 June 2023 3.70 Class D 5,470 $5,470 July 2023 3.99 Class E 4,380 $4,380 May 2025 5.02 Total Term Note Securitizations $ 201,650 $ 76,563 3.05 % (1)(2) (1) Represents the original weighted average initial coupon rate for all tranches of the securitization. In addition to this coupon interest, term note securitizations have other transaction costs which are amortized over the life of the borrowings as addition al interest expense. ( 2 ) The weighted average coupon rate of the 2018-1 term note securitization will approximate 3 .54 % over the remaining term of the borrowing. Federal Funds Line of Credit with Correspondent Bank MBB has established a federal funds line of credit with a correspondent bank. This line allows for both selling and purchasing of federal funds. The amount that can be drawn against the line is limited to $25.0 million. As of December 31, 2019 and 2018 , there were no balances outstanding on this line of credit. Federal Reserve Discount Window In addition, MBB has received approval to borrow from the Federal Reserve Discount Window based on the amount of assets MBB chooses to pledge. MBB had $32.8 million in unused, secured borrowing capacity at the Federal Reserve Discount Window, based on $ 35.6 million of net investment in l eases pledged at December 31, 2019 . Maturities Scheduled principal and interest payments on outstanding borrowings as of December 31, 2019 are as follows: Principal Interest (Dollars in thousands) Period Ending December 31, 2020 $ 44,352 $ 1,991 2021 23,629 813 2022 8,582 159 $ 76,563 $ 2,963 |
Fair Value Measurements and Dis
Fair Value Measurements and Disclosures about the Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements and Disclosures about the Fair Value of Financial Instruments | NOTE 15 - Fair Value Measurements and Disclosures about the Fair Value of Financial Instruments Fair Value Measurements Fair value is defined as the price that would be received to sell an asset or the price that would be paid to transfer a liability on the measurement date. Fair value is based on quoted market prices, where available. If quoted prices are not available, fair value is estimated based upon other observable inputs. Unobservable inputs are used when observable inputs are not available and are based upon judgments and assumptions, which are the Company’s assessment of the assumptions market participants would use in pricing the asset or liability. A three-level valuation hierarchy is used to classify inputs into the measurement of assets and liabilities at fair value. The valuation hierarchy is based upon the relative reliability and availability to market participants of inputs fo r the valuation of an asset or liability as of the measurement date. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based on the lowest level input that is significant to the measurement in its entirety. Recurring Fair Value Measurements The Company’s balances measured at fair value on a recurring basis include the following as of December 31, 2019 and 2018 : December 31, 2019 December 31, 2018 Fair Value Measurements Using Fair Value Measurements Using Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 (Dollars in thousands) Assets ABS $ — $ 4,332 $ — $ — $ 4,915 $ — Municipal securities — 3,129 — — 2,612 — Mutual fund 3,615 — — 3,429 — — At this time, the Company has not elected to report any assets and liabilities using the fair value option . There have been no transfers between Level 1 and Level 2 of the fair value hierarchy for any of the periods presented . Non-Recurring Measurements Non-recurring fair value measurements include assets and liabilities that are periodically remeasured or a ssessed for impairment using Fair value measurements. Non-recurring measurements include the Company’s evaluation of goodwill and residual assets for impairment, and the Company’s remeasurement of contingent consideration and assessment of the carrying amo unt of its servicing liability. For the year ended December 31, 2019, the Company recognized $0.3 million for the remeasurement of contingent consideration in the Consolidated Statements of Operations in connection with non-recurring fair value measurements . For the years ending December 31, 2018, and 2017, there were no significant amounts recognized in the Consolidated Statements of Operations in connection with non-recurring fair value measurements. Fair Value of Other Financial Instruments The following summarizes the carrying amount and estimated fair value of the Company’s other financial instruments, including those not measured at fair value on a recurring basis: December 31, 2019 December 31, 2018 Carrying Fair Carrying Fair Amount Value Amount Value (Dollars in thousands) Assets Cash and cash equivalents $ 123,096 $ 123,096 $ 97,156 $ 97,156 Time deposits with banks 12,927 12,970 9,659 9,614 Restricted interest-earning deposits 6,931 6,931 14,045 14,045 Net investment in leases and loans, net: Loans, net of allowance 588,688 593,406 518,697 515,754 Other assets: Federal Reserve Bank Stock 1,711 1,711 1,711 1,711 Liabilities Deposits $ 839,132 $ 846,304 $ 755,776 $ 722,682 Long-term borrowings 76,091 76,781 150,055 149,912 The fair values shown above have been derived, in part, by management’s assumptions, the estimated amount and timing of future cash flows and estimated discount rates. Valuation techniques involve uncertainties and require assumptions and judgments regarding prepayments, credit risk and discount rates. Changes in these assumptions will result in different valuation estimates. The fair values presented would not necessarily be realized in an immediate sale. Derived fair value estimates cannot necessarily be substantiated by comparison to independent markets or to other companies’ fair value information. The paragraphs which follow describe the methods and assumptions used in estimating the fair values of financial instruments. Cash and Cash Equivalents . The carrying amounts of the C ompany’s cash and cash equivalents approximate s fair value, because they bear interest at market rates and had maturities of less than 90 days at the time of purchase. The cash equivalents include a money market fund with a balance of $ 56.3 million that th e Company considers operating cash and has no reportable gross unrealized gains or losses. This fair value measurement of cash and cash equivalents is classified as Level 1. Time Deposits with Banks . Fair value of time deposits is estimated by discounting cash flows of current rates paid by market participants for similar time deposits of the same or similar remaining maturities. This fair value measurement is classified as Level 2. Restricted Interest-Earning Deposits . Interest-earning deposi ts earn a floating rate of market interest which results in a fair value approximating the carrying amount. This fair value measurement is classified as Level 1. L oans . The Company’s loan portfolio is comprised of Equipment Loans, Working Capital loans, and loans under the Community Reinvestment Act of 1977 (CRA). F air value of Equipment loans is estimated by discounting the future cash flows using the current rate at which similar loans would be made to borrowers with similar credit, collateral, and for the same remaining maturities. This fair value measurement is classified as Level 2. Fair value for Working Capital loans is estimated by discounting cash flows at an imputed market rate for similar loan products with similar characteristics. This fair value measurement is classified as Level 2. Fair value of CRA loans approximates the c arrying amount at December 31, 2019 and December 31, 2018 as it is based on recent comparable sales transactions with consideration of current market rates. This fair value measurement is classified as Level 2. F ederal Reserve Bank Stock . Federal Reserve Bank Stock are non-marketable equitable equity securities and are reported at their redeemable carrying amounts, which approximates fair value. This fair value measurement is classified as Level 2. Deposits . Deposit liabilities with no defined maturity s uch as MMDA deposits have a fair value equal to the amount payable on demand at the reporting date (i.e., their carrying amount). Fair value for certificates of deposits is estimated by discounting cash flows at current rates paid by the Company for simila r certificates of deposit of the same or similar remaining maturities. This fair value measurement is classified as Level 2. Long-Term Borrowings . The fair value of the Company’s secured borrowings is estimated by discounting cash flows at indicative mar ket rates applicable to the Company’s secured borrowings of the same or similar maturities. This fair value measurement is classified as Level 2. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Taxes [Abstract] | |
Income Taxes | NOTE 16 - Income Taxes The C ompany’s income tax provision consisted of the following components: Year Ended December 31, 2019 2018 2017 (Dollars in thousands) Current: Federal $ 240 $ 201 $ (4,591) State 1,829 1,707 1,419 Total current 2,069 1,908 (3,172) Deferred Federal 6,896 6,133 986 State 772 (320) 530 Total deferred 7,668 5,813 1,516 Total income tax expense (benefit) $ 9,737 $ 7,721 $ (1,656) In accordance with U.S. GAAP, uncertain tax positions taken or expected to be taken in a tax return are subject to potential financial statement recognition based on prescribed recognition and measurement criteria. Based on our evaluation, there are no unrecognized tax benefits and we did no t have any accrued interest and penalties as of December 31, 2019 and 2018 and for years ended December 31, 2019, 2018 and 2017 . We do not expect our unrecognized tax positions to change significantly over the next 12 months . The periods subject to examination for the Company’s federal return include the 201 6 tax year to the present. The Company files state income tax returns in various states which may have different statutes of limitations. Generally, state income tax returns for the years 201 6 through the present are subject to examination. On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the TCJA. The TCJA makes broad and complex changes to the U.S. tax code , including, but not limited to, reducing the U.S. federal corporate tax rate from 35 percent to 21 percent, effective January 1, 2018. Consequently, we recorded a decrease related to deferred tax assets and deferred tax liabilities of $ 4.5 million and $ 14 .7 million, respectively, with a corresponding net adjustment to deferred income tax benefit of $10.2 million for the year ended December 31, 2017 , and upon further analysis, determined that no additional adjustments were required. Deferred income tax expen se results principally from the use of different revenue and expense recognition methods for tax and financial accounting purposes, primarily related to lease accounting. The Company estimates these differences and adjusts to actual upon preparation of the income tax returns. The sources of these temporary differences and the related tax effects were as follows: December 31, 2019 2018 (Dollars in thousands) Deferred income tax assets: Allowance for credit losses $ 5,830 $ 4,484 Net operating loss 4,002 5,443 Accrued expenses 1,003 2,111 Deferred income 1,656 1,723 Deferred compensation 1,476 1,416 Other comprehensive loss 20 55 Other 144 743 Gross deferred income tax assets 14,131 15,975 Valuation allowance (258) — Deferred tax assets, net of valuation allowance 13,873 15,975 Deferred income tax liabilities: Lease accounting (41,770) (35,472) Deferred acquisition costs (1,960) (2,480) Depreciation (971) (583) Deferred income tax liabilities (44,701) (38,535) Net deferred income tax liability $ (30,828) $ (22,560) The Company's net deferred tax assets are reduced by valuation allowances if it is more likely than not that some portion of the deferred tax asset will not be realized. The Company’s evaluation of the realizability of its net deferred tax asset as of December 31, 2019 resulted in a valuation allowance relating to certain state loss carryforwards. The C ompany has a gross federal and state income tax net operating loss ca rryforward in the amount of $ 27.5 million and $ 35.6 million for years the ending December 31, 2019 and December 31, 2018 , respectively. The federal net operating loss of $ 15.7 million can be carried forward indefinitely. Federal net operating losses are post tax-reform related and therefore cannot fully offset current federal tax expense due to utilization being limited to 80 % of federal taxable income. Most of the state net operating loss carryforwards are set to expire b etween 202 9 and 203 9 . The following is a reconciliation of the statutory federal income tax rate to the effective income tax rate: Year Ended December 31, 2019 2018 2017 Statutory federal income tax rate 21.0 % 21.0 % 35.0 % State taxes, net of federal benefit 5.6 3.3 2.7 Other permanent differences 0.3 0.2 (0.1) Excess stock based compensation (0.2) (0.7) (1.5) Tax benefit due to TCJA — — (43.4) Other (0.2) (0.2) 0.3 Effective rate 26.4 % 23.6 % (7.0) % |
Earnings Per Common Share ("EPS
Earnings Per Common Share ("EPS") | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Common Share ("EPS") [Abstract] | |
Earnings Per Common Share ("EPS") | NOTE 17 - Earnings Per Share The Company’s restricted stock awards are paid non-forfeitable common stock dividends and thus meet the criteria of participating securities. Accordingly, earnings per share (“EPS”) has been calculated using the two-class method , under which earnings are a llocated to both common stock and participating securities . The Company’s weighted-average common shares outstanding for the periods presented include share repurchase activity, as outlined in Note 18 , “Stockholders Equity”. Basic EPS has been computed by dividing net income allocated to common stock by the weighted average common shares used in computing basic EPS. For the computation of basic EPS, all shares of re stricted stock have been deducted from the weighted average shares outstanding. Diluted EPS has been computed by dividing net income allocated to common stock by the weighted average number of common shares used in computing basic EPS, further adjusted b y including the dilutive impact of the exercise or conversion of common stock equivalents, such as stock options, into shares of common stock as if those securities were exercised or converted. The following table provides net income and shares used in co mputing basic and diluted EPS : Year Ended December 31, 2019 2018 2017 (Dollars in thousands, except per-share data) Basic EPS Net income $ 27,116 $ 24,980 $ 25,292 Less: net income allocated to participating securities (339) (432) (628) Net income allocated to common stock $ 26,777 $ 24,548 $ 24,664 Weighted average common shares outstanding 12,253,402 12,418,510 12,528,195 Less: Unvested restricted stock awards considered participating securities (153,482) (217,045) (312,175) Adjusted weighted average common shares used in computing basic EPS 12,099,920 12,201,465 12,216,020 Basic EPS $ 2.21 $ 2.01 $ 2.02 Diluted EPS Net income allocated to common stock $ 26,777 $ 24,548 $ 24,664 Adjusted weighted average common shares used in computing basic EPS 12,099,920 12,201,465 12,216,020 Add: Effect of dilutive stock-based compensation awards 97,877 71,941 33,603 Adjusted weighted average common shares used in computing diluted EPS 12,197,797 12,273,406 12,249,623 Diluted EPS $ 2.20 $ 2.00 $ 2.01 For the years ended December 31, 2019 , 2018 and 2017 , outstanding stock-based compensation awards in the amount of 159,077 , 145,847 and 101,157 , respectively, were considered antidilutive and therefore we re not considered in the computation of potential common shares for purposes of diluted EPS. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2019 | |
Stockholders' Equity [Abstract] | |
Stockholders' Equity | NOTE 18 - Stockholders’ Equity Stockholders’ Equity On July 29, 2014, the Company’s Board of Directors approved the 2014 Repurchase Plan, under which, the Company was authorized to repurchase up to $15 million in value of its outstanding shares of common stock. On May 30, 2017, the Company’s Board of Directors approved the 2017 Repurchase Plan to replace the 2014 Repurchase Plan. Under the 2017 Repurchase Plan, the Company was authorized to repurchase up to $10 million in value of its outst anding shares of common stock. At December 31, 2019, there was no authorization remaining under the 2017 Repurchase Plan. On August 1, 2019, the Company’s Board of Directors approved a stock repurchase plan (the “2019 Repurchase Plan”) under which the Company is authorized to repurchase up to $10 million in value of its outstanding shares of common stock. This authority may b e exercised from time to time and in such amounts as market conditions warrant. The repurchases may be made on the open market, in block trades or otherwise. The stock repurchase program does not obligate the Company to acquire any particular amount of com mon stock, and it may be suspended at any time at the Company's discretion. The repurchases are funded using the Company’s working capital. At December 31, 2019 , the Company had $ 8.9 million remaining in the 201 9 Repurchase Plan . Any shares purch ased under this plan are returned to the status of authorized but unissued shares of common stock. P ar value of the shares repurchased is charged to common stock with the excess of the purchase price over par charged against any available additional paid-i n capital. During the year ended December 31, 2019 , the Company purchase d 47,186 shares of its common stock in the open market under the 201 9 Repurchase Plan at an average cost of $22.30 and 247,500 shares of its common stock in the open market under the 201 7 Repurchase Plan at an average cost of $23.24 . During the year ended December 31, 2018 , the Company purchase d 83,305 shares of its common stock in the open market under the 201 7 Re purchase Plan at an average cost of $25.83 per share . During the year ended December 31, 2017 , the Company purchased 87,210 shares of its common stock in the open market under the 2017 Repurchase Plan at an average cost of $ 24.05 per share and 58,914 shares of its common stock under the 2014 Repurchase Plan at an average cost of $ 25.09 per share . In addition to the repurchases described above, participants in the Company’s 2003 Equity Compensation Plan, as amended (the “2003 Plan”) and the Company’s 2014 Equity Compensation Plan (approved by the Company’s shareholders on June 3, 2014) (the “2014 Pl an” and, together with the 2003 Plan, the “Equity Plans”) may have shares withheld to cover income taxes. There were 22,741 , 28,605 and 38,139 shares repurchased to cover income tax withholding in connection with shares granted under the Equity Plans during the years ended December 31, 2019 , 2018 and 2017 , respectively, at average per-share costs of $22.85 , $26.50 and $24.27 , respectively. Regulatory Capital Requirements Through its issuance of FDIC-insured deposits, MBB serves as the Company’s primary funding source. Over time, MBB may offer other products and services to the Company’s customer base. MBB operates as a Utah state-chartered, Federal Reserve member commercial bank, insured by the FDIC. As a state-chartered Federal Reserve member bank, MBB is supervised by both the Federal Reserve Bank of San Francisco and the Utah Department of Financial Institutions. The Comp any and MBB are subject to capital adequacy regulations issued jointly by the federal bank regulatory agencies. These risk-based capital and leverage guidelines make regulatory capital requirements more sensitive to differences in risk profiles among banki ng organizations and consider off-balance sheet exposures in determining capital adequacy. The federal bank regulatory agencies and/or the U.S. Congress may determine to increase capital requirements in the future due to the current economic environment. U nder the capital adequacy regulation, at least half of a banking organization’s total capital is required to be "Tier 1 Capital" as defined in the regulations, comprised of common equity, retained earnings and a limited amount of non-cumulative perpetual p referred stock. The remaining capital, "Tier 2 Capital," as defined in the regulations, may consist of other preferred stock, a limited amount of term subordinated debt or a limited amount of the reserve for possible credit losses. The regulations establis h minimum leverage ratios for banking organizations, which are calculated by dividing Tier 1 Capital by total quarterly average assets. Recognizing that the risk-based capital standards principally address credit risk rather than interest rate, liquidity, operational or other risks, many banking organizations are expected to maintain capital in excess of the minimum standards. The Company and MBB operate under the Basel III rules. The se standards require a minimum for Tier 1 leverage ratio of 4%, minimum T ier 1 risk-based ratio of 6% , and a t otal risk-based capital ratio of 8%. The Basel III adequacy standards establish ed a new common equity Tier 1 risk-based capital ratio with a required 4.5% minimum (6.5% to be considered well-capitalized). The Company is required to have a level of regulatory capital in excess of the regulatory minimum and to have a capital buffer above 1.25% for 2017, 1.875% for 2018, and 2.5% for 2019 and thereafter. If a banking organization does not maintain capital abov e the minimum plus the capital conservation buffer it may be subject to restrictions on dividends, share buybacks, and certain discretionary payments such as bonus payments. The Company plans to provide the necessary capital to maintain MBB at “well-capi talized” status as defined by banking regulations and as required by an agreement entered into by and among MBB, MLC, Marlin Business Services Corp. and the FDIC in conjunction with the opening of MBB (the “FDIC Agreement”). MBB’s Tier 1 Capital balance at December 31, 2019 was $147.8 million, which met all capital requirements to which MBB is subject and qualified MBB for “well-capitalized” status. At December 31, 2019 , the Company also exceeded its regulatory capital requirements and was considered “wel l-capitalized” as defined by federal banking regulations and as required by the FDIC Agreement. The following table sets forth the Tier 1 leverage ratio, common equity Tier 1 risk-based capital ratio , Tier 1 risk-based capital ratio and total risk-based capital ratio for Marlin Business Services Corp. and MBB at December 31, 2019 and 2018 . December 31, 2019 Minimum Capital Well-Capitalized Capital Actual Requirement Requirement Ratio Amount Ratio (1) Amount Ratio Amount (Dollars in thousands) Tier 1 Leverage Capital Marlin Business Services Corp. 16.31% $ 200,702 4% $ 49,225 5% $ 61,532 Marlin Business Bank 13.91% $ 147,810 5% $ 53,124 5% $ 53,124 Common Equity Tier 1 Risk-Based Capital Marlin Business Services Corp. 18.73% $ 200,702 4.5% $ 48,228 6.5% $ 69,663 Marlin Business Bank 15.47% $ 147,810 6.5% $ 66,870 6.5% $ 66,870 Tier 1 Risk-based Capital Marlin Business Services Corp. 18.73% $ 200,702 6% $ 64,305 8% $ 85,739 Marlin Business Bank 15.47% $ 147,810 8% $ 81,199 8% $ 81,199 Total Risk-based Capital Marlin Business Services Corp. 19.99% $ 214,201 8% $ 85,739 10% $ 107,174 Marlin Business Bank 16.73% $ 159,845 15% $ 143,292 10% (1) $ 100,305 December 31, 2018 Minimum Capital Well-Capitalized Capital Actual Requirement Requirement Ratio Amount Ratio (1) Amount Ratio Amount (Dollars in thousands) Tier 1 Leverage Capital Marlin Business Services Corp. 16.38% $ 183,283 4% $ 44,756 5% $ 55,945 Marlin Business Bank 15.55% $ 138,994 5% $ 44,706 5% $ 44,706 Common Equity Tier 1 Risk-Based Capital Marlin Business Services Corp. 17.50% $ 183,283 4.5% $ 47,118 6.5% $ 68,060 Marlin Business Bank 15.99% $ 138,994 6.5% $ 60,862 6.5% $ 60,862 Tier 1 Risk-based Capital Marlin Business Services Corp. 17.50% $ 183,283 6% $ 62,825 8% $ 83,766 Marlin Business Bank 15.99% $ 138,994 8% $ 73,903 8% $ 73,903 Total Risk-based Capital Marlin Business Services Corp. 18.76% $ 196,409 8% $ 83,766 10% $ 104,708 Marlin Business Bank 17.24% $ 149,909 15% $ 130,418 10% (1) $ 91,292 (1) MBB is required to maintain “well-capitalized” status and must also maintain a total risk-based capital ratio greater than 15% pursuant to the FDIC Agreement. Prompt Corrective Action. The Federal Deposit Insurance Corporation Improvement Act of 1991 (“FDICIA”) requires the federal regulators to take prompt corrective action against any undercapitalized institution. F ive capital categories have been established under federal banking r egulations : well-capitalized, adequately capitalized, undercapitalized, significantly undercapitalized and critically undercapitalized. Well-capitalized institutions significantly exceed the required minimum level for each relevant capital measure. Adequat ely capitalized institutions include depository institutions that meet but do not significantly exceed the required minimum level for each relevant capital measure. Undercapitalized institutions consist of those that fail to meet the required minimum level for one or more relevant capital measures. Significantly undercapitalized characterizes depository institutions with capital levels significantly below the minimum requirements for any relevant capital measure. Critically undercapitalized refers to deposi tory institutions with minimal capital and at serious risk for government seizure. Under certain circumstances, a well-capitalized, adequately capitalized or undercapitalized institution may be treated as if the institution were in the next lower capital category. A depository institution is generally prohibited from making capital distributions, including paying dividends, or paying management fees to a holding company if the institution would thereafter be undercapitalized. Institutions that are adequa tely capitalized but not well-capitalized cannot accept, renew or roll over brokered deposits except with a waiver from the FDIC and are subject to restrictions on the interest rates that can be paid on such deposits. Undercapitalized institutions may not accept, renew or roll over brokered deposits. The federal bank regulatory agencies are permitted or, in certain cases, required to take certain actions with respect to institutions falling within one of the three undercapitalized categories. Depending on the level of an institution’s capital, the agency’s corrective powers include, among other things: • prohibiting the payment of principal and interest on subordinated debt; • prohibiting the holding company from making distributions without prior regula tory approval; • placing limits on asset growth and restrictions on activities; • placing additional restrictions on transactions with affiliates; • restricting the interest rate the institution may pay on deposits; • prohibiting the institution from accep ting deposits from correspondent banks; and • in the most severe cases, appointing a conservator or receiver for the institution. A banking institution that is undercapitalized is required to submit a capital restoration plan, and such a plan will not be accepted unless, among other things, the banking institution’s holding company guarantees the plan up to a certain specified amount. Any such guarantee from a depository institution’s holding company is entitled to a priority of payment in bankruptcy. Pursuant to the FDIC Agreement entered into in conjunction with the opening of MBB , MBB must keep its total risk-based capital ratio above 15%. MBB’s total risk-based capital ratio of 16.73% at December 31, 2019 exceeded the threshold for “well capita lized” status under the applicable laws and regulations, and also exceeded the 15% minimum total risk-based capital ratio required in the FDIC Agreement. Dividends . The Federal Reserve Board has issued policy statements requiring insured banks and bank holding companies to have an established assessment process for maintaining capital commensurate with their overall risk profile. Such assessment process may affect the ability of the organizations to pay dividends. Although generally organizations may pay dividends only out of current operating earnings, dividends may be paid if the distribution is prudent relative to the organization’s financial position and risk profile, after consideration of current and prospective economic conditions. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2019 | |
Stock-Based Compensation [Abstract] | |
Stock-Based Compensation | NOTE 19 - Stock-Based Compensation Awards for Stock-Based Compensation are governed by the Company’s 2003 Equity Compensation Plan, as amended (the “2003 Plan”), the Company’s 2014 Equity Compensation Plan (approved by the Company’s shareholders on June 3, 2014) (the “2014 Plan”) and the Company’s 2019 Equity Compensation Plan (approved by the Company’s shareholders on May 30, 2019) (the “2019 Plan” and, together with the 2014 Plan and the 2003 Plan, the “Equity Compensation Plans”). Under the terms of the Equity Compensation Plans, employees, certain consultants and advisors and non-employee members of the Company’s Board of Directors have the opportunity to receive incentive and nonqualified grants of stock options, stock appreciation rights, restricted stock and other equity-based awards as approved by the Company’s Board of Directors. These award programs are used to attract, retain and motivate employees and to encourage individuals in key management roles to retain stock. The Company has a policy of issuing new shares to satisfy awards under the Equity Compensation Plans . The aggregate number of shares under the 201 9 Plan that may be issued for Grants is 826,036 . There were 820,990 shares available for futur e awards under the 201 9 Plan as of December 31, 2019 . Total stock-based compensation expense was $ 3.1 million, $ 3.4 million and $ 2.8 million for the years ended December 31, 2019 , 2018 and 2017 , respectively. Excess tax benefits from stock-based payment arrangements was $ 0.1 million , $0.3 million and $0.4 million for the year s ended December 31, 2019 , 2018 , and 2017 , respectively. Stock Options Option awards are generally granted with an exercise price equal to the market price of the Company’s stock at the date of the grant and have seven year contractual terms. All options issued contain service conditions based on the participant’s continued service with t he Company and may provide for accelerated vesting if there is a change in control as defined in the Equity Compensation Plans . Employee s tock options generally vest over three to four years. T he Company may also issue stock options to non-employee independent directors. These options generally vest in one year. There were no stock options granted during the year ended December 31, 2019 . There were 68,689 and 115,883 stock options granted with fair value of $ 7.21 and 6.56, during the year s ended December 31, 2018 and 2017 , respectively. Fair value of options was estimated on the date of grant using the Black-Scholes option pricing model using the following weighted average assumptions: Years Ended December 31, 2018 2017 Risk-free interest rate 2.64% 1.82% Expected life (years) 4.50 4.50 Expected volatility 32.32% 34.62% Expected dividends 1.98% 2.17% The expected life for options is estimated based on their vesting and contractual terms and was determined by applying the simplified method as defined by the SEC’s Staff Accounting Bulletin No. 107 (“SAB 107”). The risk-free interest rate reflected the yield on zero-coupon Treasury securities with a term approximating the expected life of the stock options. The expected volatility was determined using historical volatilities based on historical stock prices. A summary of option activity for t he each of the three years in the period ended December 31, 2019 follows : Weighted Average Number of Exercise Price Options Shares Per Share Outstanding, December 31, 2016 41,640 $ 12.37 Granted 115,883 25.75 Exercised (39,416) 12.37 Forfeited (21,122) 24.35 Expired — — Outstanding, December 31, 2017 96,985 $ 25.75 Granted 68,689 28.25 Exercised (909) 25.75 Forfeited (17,827) 26.97 Expired (507) 25.75 Outstanding, December 31, 2018 146,431 $ 26.77 Granted — — Exercised — — Forfeited (6,948) 27.00 Expired (4,324) 25.75 Outstanding, December 31, 2019 135,159 $ 26.80 During the year s ended December 31, 2019 , 2018 and 2017 , the Company recognized total compensation expense related to options of $ 0.3 million $ 0.3 million , and $ 0.2 million, respectively . There were no stock options exercised during the year ended December 31, 2019 . There were 909 and 39,416 stock options exercised during the years ended December 31, 2018 and 2017 , respectively. The total pretax intrinsic value of stock options exercised was $ 0.1 million and $ 0.4 million for the years ended December 31, 2018 , and 2017 , respectively. The following table summarizes information about th e stock options outstanding and exercisable as of December 31, 2019 : Options Outstanding Options Exercisable Weighted Weighted Aggregate Weighted Weighted Aggregate Average Average Intrinsic Average Average Intrinsic Range of Number Remaining Exercise Value Number Remaining Exercise Value Exercise Prices Outstanding Life (Years ) Price (In thousands) Exercisable Life (Years ) Price (In thousands) $ 25.75 78,606 4.2 25.75 — 54,016 4.2 25.75 — $ 28.25 56,553 5.2 28.25 — 20,001 5.2 28.25 — 135,159 4.6 26.80 $ — 74,017 4.5 26.43 $ — The aggregate intrinsic value in the preceding table represents the total pretax intrinsic value, based on the Company’s closing stock price of $21.98 as of December 31, 2019 , which would have been received by the option holders had all option holders exercised their options as of that date. As of December 31, 2019 , there was $ 0.2 million of unrecognized compensation cost related to non-vested stock options not yet recognized in the Consolidated Statements of Operations scheduled to be r ecognized over a weighted average period of 0.9 years. Restricted Stock Awards The Company’s Restricted stock awards provide that, during the applicable vesting periods, the shares awarded may not be sold or transferred by the participant. The vesting period for restricted stock awards generally ranges from three to seven years. All awards issued contain service conditions based on the participant’s continued service with the Company and provide for accelerated vesting if there is a change in control as defined in the Equity Compensation Plans . The vesting of certain restricted shares may be accelerated to a min imum of three years based on achievement of various individual p erformance measures. Acceleration of expense for awards based on individual performance factors occurs when the achievement of the performance criteria is determined. Of the total restricted stock awards gra nted during the year ended December 31, 2019 , no shares may be subject to accelerated vesting based on individual performance factors; no shares have vesting contingent upon performance factors. Vesting was accelerated in 201 8 , 201 7 and 201 6 on certain awards based on the achievement of certain performance criteria determined annually, as described below. The Company also issues restricted stock to non-employee independent directors. These shares generally vest in seven year s from the grant date or six months following the director’s termination from Board of Directors service. The following table summarizes the activity of the non-vested restricted stock during the each of the three years in the period ended December 31, 2019 : Weighted Average Number of Grant-Date Non-vested restricted stock Shares Fair Value Outstanding at December 31, 2016 396,518 $ 16.07 Granted 44,758 25.36 Vested (122,202) 16.19 Forfeited (41,457) 16.07 Outstanding at December 31, 2017 277,617 $ 17.51 Granted 18,206 29.84 Vested (93,764) 15.13 Forfeited (15,456) 17.46 Outstanding at December 31, 2018 186,603 $ 19.91 Granted 18,924 23.19 Vested (56,606) 15.95 Forfeited (4,986) 20.36 Outstanding at December 31, 2019 143,935 $ 21.88 During the years ended December 31, 2019 , 2018 and 2017 , the Company granted restricted stock awards with grant date fair values totaling $ 0.4 million, $ 0.5 million and $ 1.1 million, respectively. The grant date fair value per share was equivalent to the Company’s closing stock price on the date of the grant. As vesting occurs, or is deemed likely to occur, compensation expense is recognized over the requisite s ervice period and additional paid-in capital is increased. The Company recognized $ 0.9 million, $ 1.3 million and $ 1.7 million of compensation expense related to restricted stock for the years ended December 31, 2019 , 2018 and 2017 , respectively. Of the $ 0.9 million total compensation expense related to restricted stock for the year ended December 31, 2019 , approximately $ 0.1 million related to accelerated vesting du ring the first quarter of 2019 , based on the achievement of certain performance criteria determined annually. Of the $ 1.3 million total compensation expense related to restricted stock for the year ended December 31, 2018 , approximatel y $ 0.2 million related to accelerated vesting during the first quarter of 2018 , which was also based on the achievement of certain performance criteria determined annually. As of December 31, 2019 , there was $ 1.4 million of unrecognized compensation cost related to non-vested restricted stock compensation scheduled to be recognized over a weighted average period of 4.4 years. As of December 31, 2019 , there were no restricted stock awards outstanding for which vesting may be accelerated based on achievement of individual performance measures. The fair values of shares that vested during the years ended December 31, 2019 , 2018 and 2017 were $ 1.3 million, $ 2.5 million and $ 3.0 million, respectively. Restricted Stock Units Restricted stock units (“RSUs”) are granted with vesting conditions based on fulfillment of a service condition (generally three to four years from the grant date), and may also require achievement of certain operating performance criteria or achievement o f certain market-based targets associated with the Company’s stock price. The market based target measurement period begins one year from the grant date and ends three years from the grant date. Expense for equity based awards with market and service condi tions is recognized over the service period based on the grant-date fair value of the award. In the second quarter of 2018, the Company modified the terms of the portion of certain outstanding 2017 performance based RSUs that are based on actual versus targeted operating performance criteria over the performance period. The modification eliminated the tax benefit that arose from the Tax Cuts and Jobs Act enacted in December of 2017. This modification did not result in any incremental compensation costs. The following tables summarize market restricted stock unit activity for the twelve-month period ended December 31, 2019 : Weighted Average Number of Grant-Date Performance-based & market-based RSUs RSUs Fair Value Outstanding at December 31, 2016 120,000 $ 9.47 Granted 72,180 24.06 Forfeited (33,627) 14.13 Converted — — Outstanding at December 31, 2017 158,553 $ 15.13 Granted 35,056 28.25 Forfeited (1,688) 25.75 Converted — — Outstanding at December 31, 2018 191,921 $ 17.43 Granted 95,408 18.37 Forfeited (17,853) 19.57 Converted (8,000) 9.47 Cancelled due to non-achievement (4,000) 9.47 Outstanding at December 31, 2019 257,476 18.00 Weighted Average Number of Grant-Date RSUs Fair Value Service-based RSUs Outstanding at December 31, 2016 — $ — Granted 30,653 25.65 Forfeited (4,813) 25.75 Converted — — Outstanding at December 31, 2017 25,840 25.63 Granted 49,463 28.26 Forfeited (5,606) 27.21 Converted (8,441) 25.63 Outstanding at December 31, 2018 61,256 27.61 Granted 74,620 21.50 Forfeited (13,033) 23.84 Converted (22,892) 27.39 Outstanding at December 31, 2019 99,951 23.59 The weighted average grant-date fair value of RSUs with both performance and market based vesting conditions granted during the twelve -month period ended December 31, 2019 was $ 12.91 per unit . The re were no RSU’s with vesting conditions based on both performance and market conditions granted during t he twelve -month period s ended December 31, 2018 and 2017 . The re were no RSU’s with vesting conditions based solely on market conditions granted during t he twelve -month period s ended December 31, 2019 and 2018 . The weighted average grant-date fair value of RSUs with market based vesting conditions granted during the twelve -month period ended December 31, 2017 was $ 13.32 per unit . The weighted average grant date fair value of these performance based RSUs was estimated using a Monte Carlo simulation valuation model with the following assumptions: Year Ended December 31, 2019 2018 2017 Grant date stock price $ 21.50 — 25.75 Risk-free interest rate 2.16 % — % 1.72 % Expected volatility 26.68 % — % 33.42 % Dividend yield — — — The risk free interest rate reflected the yield on zero coupon Treasury securities with a term approximating the expected life of the RSUs. The expected volatility was based on historical volatility of the Company’s common stock. Dividend yield was assumed at zero as the grant assumes dividends distributed during the performance period are reinvested. When valuing the grant, we have assumed a dividend yield of zero, which is mathematically equivalent to reinvesting dividends in the issuing entity. During t he years ended December 31, 2019 , 2018 and 2017 , the Company granted RSUs with grant-date fair values totaling $ 3 .4 million ,$ 2. 4 million and $ 2 . 5 million, respectiv ely. The Company recognized $ 1 . 8 million,$ , 1.7 million and $ 0. 9 million of compensation expense related to RSUs for the years ended December 31, 2019 , 2018 and 2017 , respectively. As of December 31, 2019 , there was $ 2. 7 million of unrecognized compensation cost related to RSUs scheduled to be recognized over a weighted average period of 1. 5 years based on the most probable performance assumptions . In the event maximum performance targets are achieved, an additional $ 2 . 8 million of compensation cost would be recognized over a weighted average period of 1. 7 years . As of December 31, 2019 , 1 45,729 performance units are expected to convert to shares of common stock based on the most probable performance assumptions. In the event maximum performance targets are achieved, 3 77,803 performance units would convert to shares of common stock. Employee Stock Purchase Plan In May 2012, the Company’s shareholders approved the adoption of the Company’s 2012 Employee Stock Purchase Plan (the “2012 ESPP”). Under the terms of the 2012 ESPP, employees have the opportunity to set aside up to 10% of their compensation (subject to ce rtain maximums) and to purchase shares of common stock during designated offering periods at a price equal to the lesser of 95% of the fair market value per share on the first day of the offering period or the fair market value per share on the purchase da te. The aggregate number of shares that may be issued under the 2012 ESPP is 140,000. During the years ended 2019 and 2018 , 18, 458 and 18, 076 shares, respectively, of common stock were sold for $ 0.4 million and $ 0.4 million, respectively, pursuant to the terms of the 2012 ESPP. As of December 31, 2019 , there were 14,891 shares remaining available for issuance under the 2012 ESPP. The Company recognized total compensation expense of $ 0.1 million related to the 2012 ESPP for each of the years ended December 31, 2019 , 2018 and 2017 , respectively |
Employee 401(k) Plan
Employee 401(k) Plan | 12 Months Ended |
Dec. 31, 2019 | |
Employee 401 K Plan [Abstract] | |
Employee 401(k) Plan | NOTE 20 - Employee 401(k) Plan The Company adopted a 401(k) plan (the “401(k) Plan”) which originally became effective as of January 1, 1997. The Company’s employees are entitled to participate in the 401(k) Plan, which provides savings and investment opportunities. Employees can contri bute up to the maximum annual amount allowable per Internal Revenue Service guidelines. Effective July 1, 2007, the 401(k) Plan provides for Company contributions equal to 25% of an employee’s contribution percentage up to a maximum employee contribution o f 6%. The Company’s contributions to the 401(k) Plan for the years ended December 31, 2019 , 2018 and 2017 were approximately $ 0.4 million, $ 0.3 million and $ 0.3 million, respectively. |
Condensed Financial Information
Condensed Financial Information of Parent Company | 12 Months Ended |
Dec. 31, 2019 | |
Condensed Financial Information of Parent [Abstract] | |
Condensed Financial Information of Parent Company Only Disclosure | NOTE 21 – Parent Company Summarized financial information of the parent company is as follows: Parent Company – Balance Sheet December 31, 2019 2018 ASSETS (Dollars in thousands, except per-share data) Investment in and advances to subsidiaries: Bank subsidiary $ 150,745 $ 141,827 Nonbank subsidiaries 64,211 56,684 Total assets $ 214,956 $ 198,511 LIABILITIES AND STOCKHOLDERS’ EQUITY Total liabilities — — Stockholders’ equity: Preferred Stock, $0.01 par value; 5,000,000 shares authorized; none issued — — Common Stock, $0.01 par value; 75,000,000 shares authorized; 12,113,585 and 12,367,724 shares issued and outstanding at December 31, 2019 and 2018, respectively 121 124 Additional paid-in capital 79,665 83,496 Accumulated other comprehensive loss 58 (44) Retained earnings 135,112 114,935 Total stockholders’ equity 214,956 198,511 Total liabilities and stockholders’ equity $ 214,956 $ 198,511 Parent Company – Income Statement Year Ended December 31, 2019 2018 2017 (Dollars in thousands) Income: Dividends from nonbank subsidiaries $ 14,262 $ 9,931 $ 11,556 Dividends from bank subsidiary 6,000 20,000 6,000 Total revenue 20,262 29,931 17,556 Total expense — — — Income before income taxes and equity in undistributed net income of subsidiaries 20,262 29,931 17,556 Income tax (benefit) expense — — — Equity in undistributed income (loss): Bank subsidiary 8,816 (3,417) 14,571 Nonbank subsidiaries (1,962) (1,534) (6,835) Net Income $ 27,116 $ 24,980 $ 25,292 Other comprehensive income: Reclassification due to adoption of ASU 2016-01, ASU 2018-02 and ASU 2018-03 — 107 — Increase (decrease) in fair value of securities available for sale 138 (7) 68 Tax effect (36) (48) (26) Total other comprehensive income 102 52 42 Comprehensive income $ 27,218 $ 25,032 $ 25,334 Parent Company – Statement of Cash Flows Year Ended December 31, 2019 2018 2017 (Dollars in thousands) Cash flows from operating activities: Net income $ 27,116 $ 24,980 $ 25,292 Adjustments to reconcile net income to net cash from operating activities: Equity in undistributed net (income) losses of subsidiaries (21,116) (4,980) (19,292) Net cash provided by operating activities 6,000 20,000 6,000 Cash flows from investing activities: Capital returned from nonbank subsidiaries 14,262 9,931 11,556 Capital contributed to subsidiaries (6,484) (20,492) (6,941) Net cash provided by (used in) investing activities 7,778 (10,561) 4,615 Cash flows from financing activities: Issuances of common stock 410 402 356 Repurchases of common stock (7,323) (2,908) (4,501) Dividends paid to common stockholders (6,865) (6,956) (6,958) Exercise of stock options - 23 488 Net cash used in financing activities (13,778) (9,439) (10,615) Net increase in total cash and cash equivalents — — — Total cash and cash equivalents, beginning of period — — — Total cash and cash equivalents, end of period $ — $ — $ — |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2019 | |
Subsequent Events [Abstract] | |
Events Subsequent to Year-End | NOTE 22 - Events Subsequent to Year-End The Company declared a dividend of $0.14 per share on January 30, 2020 . The quarterly dividend, which amounted to a dividend payment of approximately $1.7 million, was paid on February 20, 2020 to shareholders of record on the close of business on February 10, 2020 . It represent ed the Company’s thirty-fourth consecutive quarterly cash dividend. The payment of future dividends will be subject to approval by the Company’s Board of Directors. |
Selected Quarterly Financial Da
Selected Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information [Text Block] | Fiscal Year Quarters First Second Third Fourth (Dollars in thousands, except per-share data) Year ended December 31, 2019 Interest income $ 25,883 $ 27,082 $ 27,708 $ 26,747 Fee income 4,042 3,507 3,869 3,787 Interest and fee income 29,925 30,589 31,577 30,534 Interest expense 5,962 6,408 6,561 6,102 Provision for credit losses 5,363 4,756 7,662 10,255 Non-interest income 12,948 7,201 10,362 13,520 Income tax expense 1,602 1,974 3,281 2,880 Net income 5,141 6,115 7,446 8,414 Basic earnings per share 0.42 0.50 0.61 0.69 Diluted earnings per share 0.41 0.49 0.60 0.69 Cash dividends declared per share 0.14 0.14 0.14 0.14 Net investment in leases and loans 1,023,190 1,062,271 1,034,498 1,006,520 Total assets 1,246,725 1,279,983 1,247,416 1,207,443 Year ended December 31, 2018 Interest income $ 23,279 $ 23,964 $ 24,836 $ 24,946 Fee income 3,959 3,876 3,930 4,078 Interest and fee income 27,238 27,840 28,766 29,024 Interest expense 3,399 3,711 4,955 5,349 Provision for credit losses 4,612 4,256 4,893 5,761 Non-interest income 5,234 4,627 4,448 7,125 Income tax expense 1,682 2,057 1,723 2,259 Net income 6,185 6,467 5,906 6,422 Basic earnings per share 0.50 0.52 0.48 0.52 Diluted earnings per share 0.50 0.52 0.47 0.51 Cash dividends declared per share 0.14 0.14 0.14 0.14 Net investment in leases and loans 930,627 963,109 970,425 1,000,740 Total assets 1,071,225 1,113,311 1,126,733 1,167,046 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Significant Accounting Policies [Abstract] | |
Basis of Financial Statement Presentation | Basis of Financial Statement Presentation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. The Company has one reportable segment, which includes the Company’s commercial lending and leasing financial products and related services, including equipment loans and leases, property insurance on leased equipment, and working capital loans . All intercompany accounts and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in accordance with generally accepted accounting principles in the Uni ted States (“ U.S. GAAP ”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts o f revenues and expenses during the reporting period. Estimates are used when accounting for income recognition, the residual values of leased equipment, the allowance for credit losses, deferred initial direct costs and fees, late fee receivables, the fair value of financial instruments , estimated losses from insurance program, and income taxes. Actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents include cash and interest-bearing money market funds. For purposes of the consolidated statement of cash flows, the Company considers all highly liquid investments purchased with a maturity of three months or less to be cash equivalents. |
Time Deposits with Banks | Time Deposits with Banks Time deposits with banks are composed of FDIC-insured certificates of deposits that generally have original maturity dates of greater than 90 days. These deposits are held on the balance sheet at amortized cost. Generally, the certificates of deposits issu ed directly have the ability to redeem early; however early redemption penalties may be incurred. The certificates of deposit issued through deposit brokers generally do not have the ability to redeem early. |
Restricted Interest-Earning Deposits with Banks | Restricted Interest-Earning Deposits with Banks Restricted interest-earning deposits with banks consist primarily of various interest-earning trust accounts primarily related to the Company’s secured debt facilities including amounts due from securitizations representing reimbursements of servicing fe es and excess spread income. In addition, as of December 31, 2018, t he restricted balance also includes $ 4.0 million of funds reserved for payments related to customer restitution (see Note 12 – Commitments and Co ntingencies). |
Investments | Investments Available for Sale. Debt securities, a vailable for sale i nclud e asset-backed securities (“ABS”) and municipal bonds that are measured at fair value on a recurring basis. Debt securities, available for sale, are recorded at fair value, and unrealized gains and losses, net of tax, are reported, net of taxes, in accumulated other comprehensive income (loss) included in stockholders’ equity unless management determines that an investme nt is other-than-temporarily impaired (OTTI). Fair value measurement is based upon quoted prices in active markets, if available. If quoted prices in active markets are not available, fair values are based on prices obtained from third-party pricing vendors . See Note 15 for more information on fair value measurement of securities . Securities are evaluated on a quarterly basis, and more fr equently when market conditions warrant such an evaluation, to determine whether declines in their value are other-than-temporary (OTTI) . To determine whether a loss in value is other-than-temporary, management utilizes criteria such as the reasons underly ing the decline, the magnitude and duration of the decline and whether management intends to sell or expects that it is more likely than not that it will be required to sell the security prior to an anticipated recovery of the fair value. The term “other-t han-temporary” is not intended to indicate that the decline is permanent, but indicates that the prospects for a near-term recovery of value is not necessarily favorable, or that there is a lack of evidence to support a realizable value equal to or greater than the carrying value of the investment. Once a decline in value for a deb t security is determined to be other-than-temporary, the other-than-temporary impairment is separated into (a) the amount of the total other-than-temporary impairment related to a decrease in cash flows expected to be collected from the debt security (the credit loss) and (b) the amount of the total other-than-temporary impairment related to all other factors. The amount of the total other-than-temporary impairment related to the credit loss is recognized in earnings. The amount of the total other-than-temp orary impairment related to all other factors is recognized in other comprehensive income. Equity Securities. Equity securities represent mutual funds that are recorded at fair value. For the years ended December 31, 2018 and 2019, unrealized gains and losses of equity securities are recorded through the Consolidated Statement of Operations. For the year ended December 31, 2017, prior to the January 1, 2018 adoption of ASU 2016-01, unrealized gains and losses of equity securities classified as available for sale were reported in other comprehensive income (loss). |
Net Investment in Leases and Loans | Net Investment in Leases and Loans T he Company uses the direct finance method of accounting to record its sales-type leases and related interest income. At the inception of a lease, the Company records as an asset, the aggregate future minimum lease payments receivable, plus the estimated residual value of the leased equipment, less unearned lease income. Residual values are established at lease inception based on our estimate of the expected fair value of the equipment at the end of the lease term. Residual values may be realized at lease termination from lease extensions, sales or other dispositions of leased equipment. Estimates are based on industry data, management’s experience, and historical performance. The Company records an estimated residual value at lease inception for all fair market value and fixed purchase option leases based on a percentage of the equipm ent cost of the asset being leased. The percentages used depend on equipment type and term. In setting estimated residual values, the Company focuses its analysis primarily on the Company’s total historical and expected realization statistics pertaining to sales of equipment. In subsequent evaluations for the impairment of the booked residual values, the Company reviews historical realization statistics including lease renewals and equipment sales. Anticipated renewal income is not included in the determi nation of fair value; however, it is one of the ways that fair value may be realized at the end of the lease term. At the end of an original lease term, lessees may choose to purchase the equipment, renew the lease or return the equipment to the Company. The Company receives income from lease renewals when the lessee elects to retain the equipment longer than the original term of the lease. This income, net of appropriate periodic reductions in the estimated residual values of the related equipmen t, is included in fee income as net residual income. When a lessee elects to return equipment at lease termination, the equipment is transferred to other assets at the lower of its basis or fair market value. The Company generally sells returned equipmen t to independent third parties, rather than leasing the equipment a second time. The Company generally charges off the value of equipment within other assets once it has been aged greater than 120 days. Any loss recognized on transferring equipment to othe r assets and any gain or loss realized on the sale or disposal of equipment to a lessee or to others is included in fee income as net residual income. Based on the Company’s experience, the amount of ultimate realization of the residual value tends to re late more to the customer’s election at the end of the lease term to enter into a renewal period, to purchase the leased equipment or to return the leased equipment than it does to the equipment type. Management performs reviews of the estimated residual values and historic realization statistics no less frequently than quarterly and any impairment, if other than temporary, is recognized in the current period. Loans are stated at principal balance, net of deferred fees and costs. Loan origination fees, co mmitment fees and direct loan origination costs are deferred and recognized over the life of the related loans using an effective yield method over the period to maturity. Initial direct costs and fees related to lease originations are deferred as part of the investment and amortized over the lease term. Unearned lease income is the amount by which the total lease receivable plus the estimated residual value exceeds the cost of the equipment. Unearned lease income, net of initial direct costs and fees, is recognized as revenue over the lease term using the effective interest method. |
Allowance for Credit Losses | Allowance for Credit Losses The Company maintain s an allowance for credit losses at an amount sufficient to absorb losses inherent in our existing lease and loan portfolios as of the reporting dates based on our projection of probable net credit losses. The allowance is analyzed based on portfolio segments, which represent the level at which the Company develop s and document s a systematic methodology to determine the allowance for credit losses. As of December 31, 201 9 , the portfolio includes four segments, which consist of equipment lease and loan, Working Capital Loans, CVG , and Community Reinvestment Act (“CRA”) loans, of which all methodologies are evaluated on a pooled basis, due to their composition of similar accounts with similar general credit risk characteristics, diversified among industry, geography, equipment type (if applicable), obligor and vendor (if applicable). The Company has determined there to be one class of financing receivable within each portfolio segment as finance receivables of each segment contain the same initial measurement attributes, risk characteristics, and has the same method for monitoring and assessing credit risk within the segment. Each segment generally considers both quantitative and qualitative factors in determining the allowance for credit losses: F or the E quipment lease and loan segment , quantitative factors include a migration analysis stratified by industry classification, historic delinquencies and charge-offs, and a static pool analysis of historic recoveries. A migration analysis is a technique used to estimate the likelihood that an account will progress through the various delinquency stages and ultimately charge off. A loss emergence period (LEP), which is the period of time between an event that triggers the probability of a loss and the confirmation of loss, is applied to the migration results to develop an estimate of losses inherent in the portfolio at the reporting period. F or the CVG and Working Capital l oan segments , quantitative factors include establishing a loss curve based on historical analysis of net charge-offs. The loss curve technique is used to estimate the likelihood and timing of when an account will charge-off relative to the month in which it was funded. An LEP is applied to the loss curve results to develop an estimate of losses inherent in the portfolio at the reporting period. The CVG and Working Capital Loans segments utilize different assumptions for the historical charge-offs and loss emergence which is based on analysis specific to each segment. For t he CRA loan segment , quantitative factor includes the analysis of historical losses that are used in conjunction with an LEP to develop a quantitative allowance for credit losses. As part of our quantitative analyses for each segment our measurement may also consider specifically identified pools of equipment leases or loans separately from the quantitative analysis, whenever certain identified pools are not expected to perform consistently with their credit characteristics or the portfolio segment a s a whole . These lease and loan pools may be analyzed for impairment separately quantitative analysis and a specific reserve established. Qualitative factors that may result in further adjustments to the quantitative analyses include items such as change s in the composition of our lease and loan portfolio segments (including geography, industry, equipment type and vendor source), seasonality, economic or business conditions and other external factors, business practices or policies at the reporting date t hat are different from the periods used in the quantitative analyses and changes in experience and ability of leasing and lending management and other relevant staff. The various factors used in the analysis are reviewed periodically, and no less frequently than quarterly. The allowance for credit losses is then established based on this analysis for the projected probable net credit losses inherent in the portfolio. A provision is charged against earnings to maintain the allowance for credit losses at the appropriate level. Our policy is to generally charge-off against the allowance the estimated unrecoverable portion of accounts once they reach 120 or more days delinqu ent. Our projections of probable net credit losses are inherently uncertain, and as a result we cannot predict with certainty the amount of such losses. Changes in economic conditions, the risk characteristics and composition of the portfolio, bankruptcy laws, and other factors could impact our actual and projected net credit losses and the related allowance for credit losses . Actual losses may vary from current estimates. See further discussion under “— Recently Issued Accounting Standards” of the Januar y 1, 2020 adoption of ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, that resulted in significant changes to the company’s allowance measurement as of January 1, 2020. No amounts were reflected in these financial statements in connection with the adoption. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets The Company tests for impairment o f goodwill at least annually and more frequently as circumstances warrant in accordance with applicable accounting guidance. Accounting guidance allows for the testing of goodwill for impairment using both qualitative and quantitative factors. Impairment o f goodwill is recognized only if the carrying amount of the Company, including goodwill, exceeds the fair value of the Company. The amount of the impairment loss would be equal to the excess carrying value of the goodwill over the implied fair value of the Company’s goodwill. Currently, the Company does not have any intangible assets with indefinite useful lives. Intangible assets that are not deemed to have an indefinite useful life are amortized over their estimated useful lives. The carrying amounts of intangible assets are regularly reviewed for indicators of impairment in accordance with applicable accounting guidance. Impairment is recognized only if the carrying amount of the intangible asset is in excess of its undiscounted projected cash flows. Im pairment is measured as the difference between the carrying amount and the estimated fair value of the asset. |
Leases | Leases The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets and operating lease liabilities on our consolidated balance sheets. ROU assets and operating lease liabilities are recognized based on the present value of the future lease payments over the lease term at commencement date. As m ost of our leases do not provide an implicit rate, in order to determine the present value of future payments for office leases we use an incremental borrowing rate based on the information available through real estate databases for similar locations and for the present value of future payments for equipment leases we use the average rate of our term note securitization which is collateralized by similar equipment. The ROU asset also includes any lease payments made and excludes lease incentives. Our lease terms may include options to extend when it is reasonably certain that we will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. |
Property and Equipment | Property and Equipment P roperty and equipment are recorded at cost. Equipment capitalized under capital leases is recorded at the present value of the minimum lease payments due over the lease term. Depreciation and amortization are provided using the straight-line method over the estimated useful lives of the related assets or lease term, whichever is shorter. D epreciable lives generally range from three to seven years based on equipment type. |
Other Assets | Other Asset s Included in other assets on the Consolidated Balance Sheets are prepaid expenses, ac crued fee income , progress payments on equipment purchased to lease , income taxes receivable and Federal Reserve Bank stock. |
Revenue Recognition | Revenue Recognition The majority of the Company’s revenue-generating transactions are not subject to ASC 606, Revenue from Contracts with Customers , including revenue generated from financial instruments, such as our leases and loans, investment securities, as well as revenue related to our gain on sale of leases and loans, servicing income, and insurance premiums written and earned. Revenue-generating activities that the Company accounts for under ASC 606, which are presented in our income statements as components of non-int erest income, include certain fees such as property tax administrative fees on leases, ACH payment fees, insurance policy fees outside of the scope of ASC 944, broker fees earned for referring leases and loans to other funding partners, and other fees. Revenue— Interest Income . Interest income is recognized under the effective interest method. The effective interest method of income recognition applies a constant rate of interest equal to the internal rate of return on each lease at inception. Based o n the historical payment behavior of the Company’s equipment finance lease and loan portfolio as a whole, payments are considered reasonably assured when a lease or loan’s delinquency status is less than 90 days. Therefore, when a lease or loan is 90 days or more delinquent, the contract is classified as non-accrual and interest income recognition is discontinued. Interest income recognition resumes when the borrower makes payments sufficient to bring the status to less than 90 days delinquent. Working Capi tal Loans are generally placed in non-accrual status when they are 30 days past due and charged-off at 60 days past due . The loan is removed from non-accrual status once sufficient payments are made to bring the loan current and reviewed by management. Revenue— Fee Income . Fee income consists of fees for delinquent lease and loan payments, cash collected on early termination of leases and net residual income. Net residual income includes income from lease renewals and gains and losses on the realization of residual values of leased equipment disposed at the end of a lease’s term. Residual income is recognized as earned. Fee income from delinquent lease payments is recognized on an accrual basis based on anticipated collection rates. At a minimum of ever y quarter, an analysis of anticipated collection rates is performed based on updates to collection history. Adjustments in the anticipated collection rate assumptions are made as needed based on this analysis. Other fees are recognized when received. Revenue— Non-Interest Incom e. The Company ’s non-interest income includes certain fees such as property tax administrative fees on leases, ACH payment fees, insurance policy fees outside of the scope of ASC 944, broker fees earned for referring leases and l oans to other funding partners, and other fees. Insurance premiums written and earned are recognized on an accrual basis over the term of the policy, which is month to month. Generally, insurance payments that are 120 days or more past due are charged aga inst income. Since the policy’s premiums are recognized month to month, there is no unearned premium on the Consolidated Balance Sheets as these are fully recognized through the Consolidated Statements of Operations in the month written . Gain on sale of leases and loans is recognized in connection with the Company’s transactions to sell populations of contracts to third parties. When the transfer qualifies as a sale, the lease and loan assets are derecognized and the Company recognizes any gain (or loss) and the servicing asset and liability as applicable on the sale date driven by the pricing and net proceeds received . In the event the transfer does not qualify as a sale, the transfer would be treated as a secured borrowing. The Company may have continuing involvement in leases and loans sold through servicing the sold assets, or through limited recourse provisions. |
Securitizations | Securitizations In connection with its term note securitization transaction, the Company established a bankruptcy remote special-purpose subsidiary (“SPE”) and issued term debt to institutional investors. This type of SPE is considered a variable interest entity (“VIE”) under U.S. generally accepted accounting principles (“GAAP”). The Company is required to consolidate a VI E in which it is deemed to be the primary beneficiary through having (1) power over the significant activities of the entity and (2) an obligation to absorb losses or the right to receive benefits from the VIE which are potentially significant to the VIE. The Company continues to service the assets of its VIEs and retain equity and/or residual interests. Accordingly, assets and related debt of these VIEs are included in the accompanying Consolidated Balance Sheets. The Company’s leases and restricted inter est-earning deposits with banks are assigned as collateral for these borrowings and there is no further recourse to our general credit. Collateral in excess of these borrowings represents the Company’s maximum loss exposure. |
Initial Direct Costs and Fees | Initial Direct Costs and Fees We defer initial direct costs incurred and fees received to originate our leases and loans . The initial direct costs and fees we defer are part of the net investment in leases and loans and are amortized to interest income using the effective interest method. The January 1, 2019 adoption of ASU 2016-02, Leases , includes provisions that limit th e types of direct lease origination costs that may be deferred, which may reduce prospective deferred lease origination costs on a unit basis. For leases originated in 2019, the costs deferred are limited to internal commissions and third party commissions . For loans, including both equipment finance loans and working capital loans, and for leases originated in 2018 and prior, we defer third-party commission costs, as well as certain internal costs directly related to successful origination activity , including compensation and certain general and administrative costs . Costs subject to deferral include evaluating each prospective customer’s financial condition, evaluating and recording guarantees and other security arrangements, negotiating terms, prepa ring and processing documents and closing each transaction. The fees we defer are documentation fees collected at inception. The realization of the initial direct costs, net of fees deferred, is predicated on the net future cash flows generated by our lea se and loan portfolios. |
Stock-based Compensation | Stock-Based Compensation The Compensation—Stock Compensation Topic of the FASB ASC establishes fair value as the measurement objective in accounting for share-based payment arrangements and requires all entities to apply a fair-v alue-based measurement method in accounting for share-based payment transactions with employees and non-employees, except for equity instruments held by employee share ownership plans. The Company measures stock-based compensation cost at grant date, bas ed on the fair value of the awards ultimately expected to vest. Stock-based compensation expense is recognized on a straight-line basis over the service period. We generally use the Black-Scholes valuation model to measure the fair value of our stock optio ns and the Monte Carlo simulation valuation model to measure the fair value of our restricted stock units utilizing various assumptions with respect to expected holding period, risk-free interest rates, stock price volatility, and dividend yield. The assum ptions are based on management’s judgment concerning future events. The Company uses its judgment in estimating the amount of awards that are expected to be forfeited, with subsequent revisions to the assumptions if actual forfeitures differ from those estimates. The vesting of certain restricted shares may be accelerated to a minimum of three years based on achievement of various individual performance measures. Acceleration of expense for awards based on individual performance factors occurs when the achievement of the performance criteria is determined. Non-forfeitable dividends paid on shares of restricted stock are recorded to retained earnings for shares that are expected to vest and to compensation expense for shares that are not expected to vest. |
Income Taxes | Income Taxes The Company is subject to the income tax laws of the v arious jurisdictions in which it operates, including U.S. federal, state and local jurisdictions. A consolidated federal income tax return is filed. Depending upon the jurisdiction, the Company files consolidated or separate legal entity state income tax returns. Current tax expense represents the amount of taxes currently payable to or receivable from a taxing authority plus amounts accrued for income tax contingencies (including tax, penalty and interest). Deferred tax expense generally represents the net change in the deferred tax asset or liability balance during the year plus any change in the valuation allowance, excluding any changes in amounts recorded in Additional paid-in capital or Accumulated other comprehensive income (loss) in the Consolida ted Balance Sheets. Deferred income taxes are determined using the balance sheet method. Recognition of deferred taxes is based on the expected future tax consequences of temporary differences between the carrying amounts of assets or liabilities for book and tax purposes using the current enacted tax rates; however, deferred tax assets are reduced by valuation allowances if it is more likely than not that some portion of the deferred tax asset will not be realized. We evaluate our deferred tax assets quarterly to determine if adjustments to our valuation allowance are required based on the consideration of all available evidence, using a "more likely than not" standard with respect to whether deferred tax assets will be realized . The ultimate reali zation of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. In making this assessment, management considers the scheduled reversal of deferred tax liabil ities and projected future taxable income, the level of historical taxable income, projections for future taxable income over the periods which the deferred tax assets are deductible and available tax planning strategies. Should a change in circumstances, including differences between our future operating results and estimates, lead to a change in our judgments about the realization of deferred tax assets in future years, we would adjust the valuation allowances in the period that the change in circumstanc es occurs, along with a charge or credit to income tax expense . The Company records penalties and accrued interest related to taxes in income tax expense. Uncertain tax positions (including interest and penalties) are recognized when we believe it is mor e likely than not that the tax position will be upheld on examination by the taxing authorities based on merits of the position. As of December 31, 2019 and 2018 , there are no unrecognized tax positions. |
Earnings Per Share | Earnings Per Share The Company’s restricted stock awards are paid non-forfeitable common stock dividends and thus meet the criteria of participating securities. Accordingly, earnings per share (“EPS”) is calculated using the two-class method, under which earnings are allocated to both com mon shares and participating securities. All shares of restricted stock are deducted from the weighted average shares outstanding for the computation of basic EPS. Diluted EPS is computed based on the weighted average number of common shares outstanding for the period including the dilutive impact of the exercise or conversion of common stock equivalents, such as stock options, into shares of common stock as if those securities were exercised or converted. |
Insurance Program Deferred Acquisition Costs | Insurance Program Deferred Acquisition Costs Deferred acquisitions costs represent the fees paid to a third-party insurance company. For the years ended December 31, 2019 , 2018 , and 2017 , the Company recognized deferred acquisition costs and premium taxes of $ 1.0 million, $ 0.9 million , and $ 0. 9 million, respectively. Since the policy’s premiums are recognized on a month to month basis, there is no deferred acquisition costs on the Consolidated Balance Sheet as these are fully recognized through the Consolidated Statements of Operations in the month written. |
Provision for Unpaid Losses and Loss Adjustment Expenses | Provision for Unpaid Losses and Loss Adjustment Expenses The Company records a provision for insurance losses and loss adjustment expenses. The liability for losses and loss adjustment expenses includes an amount determined from los s reports and individual cases and an amount, based on historical loss experience and industry statistics, for losses incurred but not reported (“IBNR”). These estimates are continually reviewed and are subject to the impact of future changes in such fact ors as claim severity and frequency. Loss and loss expenses are paid when advised by the third-party insurance company. Outstanding losses comprise estimates of the amount of reported losses and loss expenses received from the third-party insurance compa ny plus a provision for losses IBNR. IBNR is determined with the assistance of a third-party actuary. For the years ended December 31, 2019 , 2018 , and 2017 , the Company recognized provision for unpaid losses and loss adjustment expenses of $ 0 .6 million, $ 0.8 million, and $ 0 .8 million, respectively. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards Income Taxes. In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes , which removes certain exceptions to the general principles of ASC 740 in order to reduce the cost and complexity of its application. Among other changes, the ASU simplifies intraperiod allocation, removes exceptions related to outside basis differences with respect to accounting for equity method investments and revises certain exceptions related to accounting for year-to-date losses in interim periods. The ASU is effective for fiscal years beginning after December 15, 2020, with early adoption permitte d. The Company has not determined the impact the adoption of this new requirement will have on its financial statements. Fair Value. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Di sclosure Requirements for Fair Value Measurement which modifies the disclosures on fair value measurements by removing the requirement to disclose the amount and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, the policy for timing of such transfers and the valuation process for Level 3 fair value measurements. The ASU expands the disclosure requirements for Level 3 fair value measurements, primarily focused on changes in unrealized gains and losses included in other comprehen sive income. The ASU is effective for fiscal years beginning after December 15, 2019, with early adoption permitted. The adoption of this new requirement will impact only footnote disclosure and will not impact the Company’s consolidated earnings, financia l position or cash flows. Intangibles - Goodwill. In August 2018, the FASB issued ASU 2018-15, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrange ment That Is a Service Contract to clarify the accounting treatment for implementation costs for cloud computing arrangements. The ASU is effective for fiscal years beginning after December 15, 2019, with early adoption permitted. The adoption of this new requirement is not expected to have a material impact on the consolidated earnings, financial position or cash flows of the Company . Credit Losses. In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which changes the methodology for evaluating impairment of most financial instruments. This guidance was subsequently amended by ASU 2018-19, Codification Improvements, ASU 2019-04, Codification Improvements , ASU 2019-05, Targeted Transition Relief, ASU 2019-10, Effective Dates, and ASU 2019-11, Codification Improvements . These ASUs are referred to collectively as “CECL”. CECL replaces the probable, incurred loss model with a measurement of expected credit losse s for the contractual term of the Company’s current portfolio of loans and leases. An allowance, or estimate of credit losses, will be recognized immediately upon the origination of a loan or lease, and will be adjusted in each subsequent reporting period . This estimate of credit losses takes into consideration all cashflows the Company expects to receive or derive from the pools of contracts, including recoveries after charge-off, and certain future cashflows from residual assets. The provision for cred it losses recognized in the Consolidated statement of Operations under CECL will be primarily driven by originations, offset by the reversal of the allowance for any contracts sold, plus adjustments for changes in estimate each subsequent reporting period. The adoption of CECL requires the company to develop and maintain a consistent systematic methodology to measure the estimated credit losses inherent in its current portfolio, over the entire life of the contracts. As part of its adoption process, th e Company assessed the appropriate collective, or pool, basis to use to aggregate its portfolio based on the existence of similar risk characteristics and determined that its measurement begins by separately considering segments of financing receivables, w hich is similar to how it has historically analyzed its allowance for credit losses: (i) equipment finance lease and loan; (ii) working capital loans; (iii) commercial vehicles “CVG”; and (iv) Community Reinvestment Act. However, these classes of receivab les are further disaggregated into pools of loans based on risk characteristics that may include: lease or loan type, origination channel, and internal credit score (which is a measurement that combines many risk characteristics, including loan size, exter nal credit scores, existence of a guarantee, and various characteristics of the borrower’s business). The Company selected a vintage loss model as the approach to estimate and measure its expected credit losses for all pools, primarily because the timin g of the losses realized has been consistent across historical vintages, such that the company is able to develop a predictable and reliable loss curve for each separate portfolio segment. The vintage model assigns loans to vintages by origination date, m easures our historical average actual loss and recovery experience within that vintage, develops a loss curve based on the averages of all vintages, and predicts (or forecasts) the remaining expected net losses of the current portfolio by applying the expe cted net loss rates to the remaining life of each open vintage. The Company’s own historical net loss experience is the foundation for measuring credit losses of its Equipment Finance and Working Capital pools. For CVG, as this product is relatively new, the Company is utilizing a combination of its own historical loss data combined with industry-sourced loss data. The Company’s estimate of expected credit losses starts with historical data, but also incorporates a reasonable and supportable forecast of relevant economic data, incorporating factors that were statistically analyzed against our long-term loss experience and found to be correlated and predictive. After the reasonable and supportable forecast period, the Company reverts straight-line to the historical net losses consistent with the long-term average economic inputs that are referenced in its model. As part of our analysis of expected credit losses, we may analyze contracts on an individual basis in situations where such loans exhibit uniqu e risk characteristics and are no longer expected to experience similar losses to the rest of their pool. As part of its estimate of expected credit losses, management considers relevant qualitative and quantitative factors to assess whether the histori cal loss experience being referenced should be adjusted to better reflect the risk characteristics of the current portfolio and the expected future loss experience for the life of these contracts. This assessment incorporates all available information rel evant to considering the collectability of its current portfolio, including considering economic and business conditions, default trends, changes in its portfolio composition, changes in its lending policies and practices, among other internal and external factors. The Company adopted the guidance in these ASUs, effective January 1, 2020, applying changes resulting from the application of the new standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective (i.e., modified retrospective approach). The adoption of this standard is expected to result in approximately an $11 million increase to our allowance, with offsetting entries to deferred taxes and retai ned earnings. For regulatory capital, the Company will avail itself of the option to phase in over a period of three years, the day one effects of CECL and expects to continue to be well capitalized under the Basel III regulatory framework after the adoption of this standard. The phase-in will be straight-line over the three year period such that the Company will phase in 25 percent of the transitional amounts in the first year, and an additional 25% over each of the next two years so that the Compan y would have phased in 75 percent of the day-one effects during year three. At the beginning of the fourth year, the Company would have completely reflected in regulatory capital the day-one effects of CECL. In addition, as a result of adoption this standard, future measurements of the impairment of our investment securities will incorporate the guidance in these ASUs, including analyzing any decline in fair value between credit quality-driven factors versus other factors. The Company’s policy for ch arging off contracts against the allowance, and non-accrual policy are not impacted by the adoption of CECL. |
Recently Adopted Accounting Standards | Recently Adopted Accounting Standards . Leases. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) to increase transparency and comparability among organizations recognizing lease assets and lease liabilities on the balance sheet. The ASU required lessees to recognize a right-of-use (ROU) asset for its right to use the underlying asset and a lease liability for the corresponding lease obligation for leases with terms of more than twelve months. Accounting by lessors remained largely unchang ed from current U.S. GAAP. The ASU also required expanded quantitative and qualitative disclosures for both lessees and lessors. In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842): Targeted Improvements, which provided entities with an additiona l (and optional) transition method in which the entity applies the new leases standard at the adoption date and recognizes a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The Company applied the new tra nsition method upon adoption. In December 2018, the FASB issued ASU 2018-20, Leases (Topic 842): Narrow Scope Improvements for Lessors, which clarified the treatment of sales taxes and other taxes collected from lessees, lessor costs paid directly by lesse es, and recognition of variable payments for contracts with lease and non-lease components. In March 2019, the FASB issued ASU 2019-01, Leases (Topic 842): Codification Improvements , which aligned the new lease guidance with the existing guidance for fair value of the underlying asset by lessors that are not manufacturers or dealers. It also clarified an exemption for lessors and lessees from a certain interim disclosure requirement associated with adopting the board’s new lease accounting standard. The Co mpany adopted the guidance in these ASUs on January 1, 2019. As a result, the Company recorded right-of-use assets of $ 9.1 million and lease liabilities of $ 9.1 million. At January 1, 2019, there was no adjustment to opening retained earnings. The Compan y, as a lessor, is recording property tax income and expense associated with leasing on a gross basis in the Consolidated Statements of Operations. The property tax income and expense are recorded in the same period as earned and incurred, and the Company recognizes a provision for uncollectible property tax revenue as contra-revenue when a loss is probable and collectability is not reasonably assured. In addition, ASU 2016-02 limits the types of direct lease origination costs that are able to be deferred , which may reduce prospective deferred lease origination costs on a unit basis. |
Non-Interest Income (Tables)
Non-Interest Income (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Noninterest Income [Abstract] | |
Non-interest income | Year Ended December 31, 2019 2018 2017 (Dollars in thousands) Gain on sale of leases and loans $ 22,210 $ 8,363 $ 2,818 Insurance premiums written and earned 8,796 8,087 7,155 Other income: Servicing income 1,526 653 864 Property tax income (1) 6,401 — — Net gains and (losses) recognized during the period on equity securities 104 (75) — Non-interest income within the scope of other GAAP topics 39,037 17,028 10,837 Other income: Property tax administrative fees on leases 1,076 740 751 ACH payment fees 316 333 326 Insurance policy fees 2,706 2,124 1,846 Referral fees 543 839 2,518 Other 353 370 454 Non-interest income from contracts with customers (ASC 606) 4,994 4,406 5,895 Total non-interest income $ 44,031 $ 21,434 $ 16,732 __________________ (1) After the January 1, 2019 adoption of ASU 2016-02, Leases , for the year ended December 31, 2019 the Company is recording property tax income and expense gross in the Consolidated Statements of Operations. For 2018 and 2017, the Company had recognized these amounts net within General and administrative expense i n the Consolidated Statements of Operations. |
Investment Securities (Tables)
Investment Securities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Investment Securities [Abstract] | |
Investment Securities | December 31, 2019 2018 (Dollars in thousands) Equity Securities Mutual fund $ 3,615 $ 3,429 Debt Securities, Available for Sale: Asset-backed securities ("ABS") 4,332 4,915 Municipal securities 3,129 2,612 Total investment securities $ 11,076 $ 10,956 |
Schedule of changes in fair value of Equity securities | Year Ended December 31, 2019 (1) 2018 (1) 2017 (2) (Dollars in thousands) Net gains and (losses) recognized during the period on equity securities $ 104 $ (75) $ — Less: Net gains and (losses) recognized during the period on equity securities sold during the period — — — Unrealized gains and (losses) recognized during the reporting period on equity securities still held at the reporting date $ 104 $ (75) $ — __________________ (1) After adoption of ASU 2016-01 on January 1, 2018, unrealized gains and losses of equity securities classified as available for sale are recorded through the Consolidated Statement of Operations. (2) Prior to adoption of ASU 2016-01, unrealized gains and losses of equity securities classified as available for sale were reported in other comprehensive income (loss). |
Summary of available for sale investments | December 31, 2019 Gross Gross Amortized Unrealized Unrealized Estimated Cost Gains Losses Fair Value (Dollars in thousands) ABS $ 4,302 $ 33 $ (3) $ 4,332 Municipal securities 3,058 71 — 3,129 Total Debt Securities, Available for Sale $ 7,360 $ 104 $ (3) $ 7,461 December 31, 2018 Gross Gross Amortized Unrealized Unrealized Estimated Cost Gains Losses Fair Value (Dollars in thousands) ABS $ 4,934 $ 20 $ (39) $ 4,915 Municipal securities 2,629 3 (20) 2,612 Total Debt Securities, Available for Sale $ 7,563 $ 23 $ (59) $ 7,527 |
Unrealized Loss on Investments | December 31, 2019 Less than 12 months 12 months or longer Total Gross Gross Gross Unrealized Fair Unrealized Fair Unrealized Fair Losses Value Losses Value Losses Value (Dollars in thousands) ABS $ — $ — $ (3) $ 430 $ (3) $ 430 Total available for sale investment securities $ — $ — $ (3) $ 430 $ (3) $ 430 December 31, 2018 Less than 12 months 12 months or longer Total Gross Gross Gross Unrealized Fair Unrealized Fair Unrealized Fair Losses Value Losses Value Losses Value (Dollars in thousands) ABS $ — $ — $ (39) $ 3,340 $ (39) $ 3,340 Municipal securities (16) 1,436 (4) 408 (20) 1,844 Total available for sale investment securities $ (16) $ 1,436 $ (43) $ 3,748 $ (59) $ 5,184 |
Investments distribution of maturities | Distribution of Maturities 1 Year Over 1 to Over 5 to Over or Less 5 Years 10 Years 10 Years Total (Dollars in thousands) Amortized Cost: ABS $ — $ 2,522 $ 1,780 $ — $ 4,302 Municipal securities 15 449 1,594 1,000 3,058 Total available for sale investments $ 15 $ 2,971 $ 3,374 $ 1,000 $ 7,360 Estimated fair value $ 15 $ 2,998 $ 3,448 $ 1,000 $ 7,461 Weighted-average yield, GAAP basis 4.75% 2.29% 2.85% 2.60% 2.44% |
Net Investment in Leases and _2
Net Investment in Leases and Loans (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Net Investment in Leases and Loans [Abstract] | |
Net investment in leases and loans details | December 31, 2019 2018 (Dollars in thousands) Minimum lease payments receivable $ 457,602 $ 530,867 Estimated residual value of equipment 29,342 27,646 Unearned lease income, net of initial direct costs and fees deferred (59,746) (68,376) Security deposits (590) (838) Total leases 426,608 489,299 Commercial loans, net of origination costs and fees deferred Working Capital Loans 60,942 36,856 CRA (1) 1,398 1,466 Equipment loans (2) 464,655 423,168 CVG 74,612 66,051 Total commercial loans 601,607 527,541 Allowance for credit losses (21,695) (16,100) $ 1,006,520 $ 1,000,740 __________________ (1) CRA loans are comprised of loans originated under a line of credit to satisfy its obligations under the Community Reinvestment Act of 1977. (2) Equipment loans are comprised of Equipment Finance Agreements, Install Purchase Agreements, and other loans. |
Minimum lease payments receivable under lease contracts and the amortization of unearned lease income | Minimum Lease Payments Income Receivable (1) Amortization (2) (Dollars in thousands) Period Ending December 31, 2020 $ 183,266 $ 29,961 2021 130,656 16,950 2022 82,316 8,454 2023 43,390 3,361 2024 15,768 805 Thereafter 2,206 215 $ 457,602 $ 59,746 ________________________ (1) Represents the undiscounted cash flows of the lease payments receivable. (2) Represents the difference between the undiscounted cash flows and the discounted cash flows. |
Lease income | Year Ended December 31, 2019 2018 2017 (Dollars in thousands) Interest Income $ 41,891 $ 48,914 $ 56,428 |
Summary of information related to lease portfolio sales | Year Ended December 31, 2019 2018 2017 (Dollars in thousands) Sales of leases and loans $ 310,415 $ 138,995 $ 66,744 Gain on sale of leases and loans 22,206 8,364 2,818 |
Allowance for Credit Losses (Ta
Allowance for Credit Losses (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Allowance For Credit Losses [Abstract] | |
Activity in the allowance for credit losses and asset quality statistics | December 31, 2019 Commercial Leases and Loans (Dollars in thousands) Working Capital Loans CRA Equipment Finance (2) CVG Total Allowance for credit losses, beginning of period $ 1,467 $ — $ 13,531 $ 1,102 $ 16,100 Charge-offs (2,868) — (20,328) (1,875) (25,071) Recoveries 337 — 2,164 129 2,630 Net charge-offs (2,531) — (18,164) (1,746) (22,441) Provision for credit losses 2,963 — 22,967 2,106 28,036 Allowance for credit losses, end of period $ 1,899 $ — $ 18,334 $ 1,462 $ 21,695 Ending lease or loan balance (1) $ 60,412 $ 1,398 $ 863,533 $ 82,363 $ 1,007,706 Ending balance: individually evaluated for impairment (3) $ — $ — $ — $ — $ — December 31, 2018 Commercial Leases and Loans (Dollars in thousands) Working Capital Loans CRA Equipment Finance (2) CVG Total Allowance for credit losses, beginning of period $ 1,036 $ — $ 12,663 $ 1,152 $ 14,851 Charge-offs (1,537) — (18,149) (907) (20,593) Recoveries 60 — 2,199 61 2,320 Net charge-offs (1,477) — (15,950) (846) (18,273) Provision for credit losses 1,908 — 16,818 796 19,522 Allowance for credit losses, end of period $ 1,467 $ — $ 13,531 $ 1,102 $ 16,100 Ending lease or loan balance (1) $ 36,478 $ 1,466 $ 890,785 $ 67,654 $ 996,383 Ending balance: individually evaluated for impairment (3) $ — $ — $ — $ — $ — December 31, 2017 Commercial Leases and Loans (Dollars in thousands) Working Capital Loans CRA Equipment Finance (2) CVG Total Allowance for credit losses, beginning of period $ 760 $ — $ 9,808 $ 369 $ 10,937 Charge-offs (1,219) — (14,343) (1,154) (16,716) Recoveries 121 — 2,066 49 2,236 Net charge-offs (1,098) — (12,277) (1,105) (14,480) Provision for credit losses 1,374 — 15,132 1,888 18,394 Allowance for credit losses, end of period $ 1,036 $ — $ 12,663 $ 1,152 $ 14,851 Ending lease or loan balance (1,3) $ 27,810 $ 1,222 $ 826,880 $ 55,330 $ 911,242 (1) For purposes of asset quality and allowance calculations, the effects of (i) the allowance for credit losses and (ii) initial direct costs and fees deferred are excluded. (2 ) Equipment Finance consists of Equipment Finance Agreements, Install Purchase Agreements, and other leases and loans. (3) As of December 31, 2019 and December 31, 2018 , the Company determined that n o leases or loans required individual evaluation, and as of December 31, 2017 all leases and loans were collectively evaluated. |
Financing Receivable Credit Quality Indicators | December 31, 2019 Commercial Leases and Loans (Dollars in thousands) Working Capital Loans CRA Equipment Finance CVG Total Pass $ 59,081 $ 1,398 $ 849,605 $ 80,484 $ 990,568 Special Mention 143 — 5,164 318 5,625 Substandard 242 — 3,528 957 4,727 Doubtful 674 — 2,857 224 3,755 Loss 272 — 2,378 378 3,028 Total $ 60,412 $ 1,398 $ 863,532 $ 82,361 $ 1,007,703 December 31, 2018 Commercial Leases and Loans (Dollars in thousands) Working Capital Loans CRA Equipment Finance CVG Total Pass $ 35,793 $ 1,466 $ 879,275 $ 66,463 $ 982,997 Special Mention 47 — 4,373 146 4,566 Substandard 145 — 3,460 660 4,265 Doubtful 300 — 2,353 158 2,811 Loss 193 — 1,324 227 1,744 Total $ 36,478 $ 1,466 $ 890,785 $ 67,654 $ 996,383 |
Delinquent and non-accrual leases and loans | 30-59 60-89 >90 Days Days Days Total Total December 31, 2019 Past Past Past Past Finance Non- (Dollars in thousands) Due Due Due Due Current Receivables Accruing Commercial Loans: Working Capital Loans $ 584 $ 68 $ 203 $ 855 $ 59,557 $ 60,412 $ 946 CRA — — — — 1,398 1,398 — Equipment Finance (1) 5,399 3,705 5,006 14,110 969,761 983,871 5,006 CVG 406 271 435 1,112 94,344 95,456 435 Total Leases and Loans (2) $ 6,389 $ 4,044 $ 5,644 $ 16,077 $ 1,125,060 $ 1,141,137 $ 6,387 30-59 60-89 >90 Days Days Days Total Total December 31, 2018 Past Past Past Past Finance Non- (Dollars in thousands) Due Due Due Due Current Receivables Accruing Commercial Loans: Working Capital Loans $ 300 $ 51 $ 141 $ 492 $ 35,986 $ 36,478 $ 492 CRA — — — — 1,466 1,466 — Equipment Finance (1) 4,537 3,123 3,529 11,189 1,001,363 1,012,552 3,529 CVG 166 257 191 614 78,407 79,021 191 Total Leases and Loans (2) $ 5,003 $ 3,431 $ 3,861 $ 12,295 $ 1,117,222 $ 1,129,517 $ 4,212 __________________ (1 ) Equipment Finance consists of Equipment Finance Agreements, Install Purchase Agreements, and other leases and loans. (2) Represents total minimum lease and loan payments receivable for Equipment Finance and CVG and as a percentage of principal outstanding for Working Capital Loans and CRA. For information on the Company’s loan sales activity, see Note 5 , Net Investment in Leases and Loans . |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in the carrying amount of goodwill | (Dollars in thousands) Total Company Balance at December 31, 2018 $ 7,360 Changes (625) Balance at December 31, 2019 $ 6,735 |
Finite Lived Intangible Assets | Gross Carrying Accumulated Net Book Useful Life Amount Amortization Value As of December 31, 2019 (Dollars in thousands) Lender relationships 3 to 10 years $ 1,630 $ 519 $ 1,111 Vendor relationships 11 years 7,290 974 6,316 Corporate trade name 7 years 60 26 34 Total $ 8,980 $ 1,519 $ 7,461 As of December 31, 2018 Lender relationships 3 to 10 years $ 1,590 $ 271 $ 1,319 Vendor relationships 11 years 6,852 302 6,550 Corporate trade name 7 years 60 17 43 Total $ 8,502 $ 590 $ 7,912 |
Amortization expense for the next five years | (Dollars in thousands) Amortization Expense 2020 $ 798 2021 798 2022 798 2023 798 2024 790 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Property and Equipment, Net [Abstract] | |
Property and Equipment, Net | December 31, 2019 2018 Depreciable Life (Dollars in thousands) Furniture and equipment $ 4,035 $ 2,986 7 years Computer systems and equipment 18,584 17,234 3-5 years Leasehold improvements 3,552 1,197 Shorter of estimated useful life or remaining lease term Total property and equipment 26,171 21,417 Less - Accumulated depreciation and amortization (18,283) (17,100) Property and equipment, net $ 7,888 $ 4,317 |
Other Assets (Tables)
Other Assets (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Other Assets [Abstract] | |
Other Assets | December 31, 2019 2018 (Dollars in thousands) Accrued fees receivable $ 3,509 $ 3,354 Prepaid expenses 2,872 2,447 Federal Reserve bank stock 1,711 1,711 Other 2,361 2,144 $ 10,453 $ 9,656 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Components of lease expense | The components of lease expense were as follows: Year Ended December 31, 2019 2018 2017 (Dollars in thousands) Operating lease cost $ 1,201 $ 1,131 $ 1,062 Finance lease costs — 7 5 Short-term lease cost 368 — — Total lease cost $ 1,569 $ 1,138 $ 1,067 |
Supplemental information related to leases | As of December 31, 2019 Weighted average remaining lease term 11.3 years Weighted average discount rate 3.30 % Year Ended December 31, 2019 (Dollars in thousands) Cash payments for operating lease liabilities, included in operating cash flows $ 424 Right-of-use assets obtained in exchange for new operating lease obligations 756 |
Maturities of lease liabilities | Maturities of lease liabilities were as follows: Operating Leases Period Ending December 31, (Dollars in thousands) 2020 $ 1,288 2021 1,081 2022 992 2023 914 2024 896 Thereafter 6,557 Total lease payments $ 11,728 Less: imputed interest (1,998) Total $ 9,730 |
Deposits (Tables)
Deposits (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Contractual Maturities of Time Deposits [Abstract] | |
Contractual Maturities Of Time Deposits [Table Text Block] | Scheduled Maturities (Dollars in thousands) Period Ending December 31, 2020 $ 388,615 2021 216,157 2022 118,792 2023 60,640 2024 31,515 $ 815,719 |
Long-term Borrowings (Tables)
Long-term Borrowings (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Borrowings [Abstract] | |
Schedule of Long-term Debt Instruments [Table Text Block] | December 31, 2019 2018 (Dollars in thousands) Term securitization 2018-1 $ 76,563 $ 151,233 Unamortized debt issuance costs (472) (1,178) $ 76,091 $ 150,055 |
Schedule of term note securitization {Table text block] | Outstanding Notes Balance Final Original Originally as of Maturity Coupon Issued December 31, 2019 Date Rate (Dollars in thousands) 2018 — 1 Class A-1 $ 77,400 $ — July 2019 2.55 % Class A-2 55,700 $8,013 October 2020 3.05 Class A-3 36,910 $36,910 April 2023 3.36 Class B 10,400 $10,400 May 2023 3.54 Class C 11,390 $11,390 June 2023 3.70 Class D 5,470 $5,470 July 2023 3.99 Class E 4,380 $4,380 May 2025 5.02 Total Term Note Securitizations $ 201,650 $ 76,563 3.05 % (1)(2) (1) Represents the original weighted average initial coupon rate for all tranches of the securitization. In addition to this coupon interest, term note securitizations have other transaction costs which are amortized over the life of the borrowings as addition al interest expense. ( 2 ) The weighted average coupon rate of the 2018-1 term note securitization will approximate 3 .54 % over the remaining term of the borrowing. |
Schedule of Future Principal and Interest Payments on Long-term Borrowings [Table Text Block] | Principal Interest (Dollars in thousands) Period Ending December 31, 2020 $ 44,352 $ 1,991 2021 23,629 813 2022 8,582 159 $ 76,563 $ 2,963 |
Fair Value Measurements and D_2
Fair Value Measurements and Disclosures about the Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on a Recurring Basis [Table Text Block] | December 31, 2019 December 31, 2018 Fair Value Measurements Using Fair Value Measurements Using Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 (Dollars in thousands) Assets ABS $ — $ 4,332 $ — $ — $ 4,915 $ — Municipal securities — 3,129 — — 2,612 — Mutual fund 3,615 — — 3,429 — — |
Schedule of Carrying Amount and Estimated Fair Value of Financial Instruments [Table Text Block] | December 31, 2019 December 31, 2018 Carrying Fair Carrying Fair Amount Value Amount Value (Dollars in thousands) Assets Cash and cash equivalents $ 123,096 $ 123,096 $ 97,156 $ 97,156 Time deposits with banks 12,927 12,970 9,659 9,614 Restricted interest-earning deposits 6,931 6,931 14,045 14,045 Net investment in leases and loans, net: Loans, net of allowance 588,688 593,406 518,697 515,754 Other assets: Federal Reserve Bank Stock 1,711 1,711 1,711 1,711 Liabilities Deposits $ 839,132 $ 846,304 $ 755,776 $ 722,682 Long-term borrowings 76,091 76,781 150,055 149,912 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Taxes [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) [Table Text Block] | Year Ended December 31, 2019 2018 2017 (Dollars in thousands) Current: Federal $ 240 $ 201 $ (4,591) State 1,829 1,707 1,419 Total current 2,069 1,908 (3,172) Deferred Federal 6,896 6,133 986 State 772 (320) 530 Total deferred 7,668 5,813 1,516 Total income tax expense (benefit) $ 9,737 $ 7,721 $ (1,656) |
Schedule of Deferred Tax Assets and Liabilities [Table Text Block] | December 31, 2019 2018 (Dollars in thousands) Deferred income tax assets: Allowance for credit losses $ 5,830 $ 4,484 Net operating loss 4,002 5,443 Accrued expenses 1,003 2,111 Deferred income 1,656 1,723 Deferred compensation 1,476 1,416 Other comprehensive loss 20 55 Other 144 743 Gross deferred income tax assets 14,131 15,975 Valuation allowance (258) — Deferred tax assets, net of valuation allowance 13,873 15,975 Deferred income tax liabilities: Lease accounting (41,770) (35,472) Deferred acquisition costs (1,960) (2,480) Depreciation (971) (583) Deferred income tax liabilities (44,701) (38,535) Net deferred income tax liability $ (30,828) $ (22,560) |
Schedule of Effective Income Tax Rate Reconciliation [Table Text Block] | Year Ended December 31, 2019 2018 2017 Statutory federal income tax rate 21.0 % 21.0 % 35.0 % State taxes, net of federal benefit 5.6 3.3 2.7 Other permanent differences 0.3 0.2 (0.1) Excess stock based compensation (0.2) (0.7) (1.5) Tax benefit due to TCJA — — (43.4) Other (0.2) (0.2) 0.3 Effective rate 26.4 % 23.6 % (7.0) % |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Common Share ("EPS") [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | Year Ended December 31, 2019 2018 2017 (Dollars in thousands, except per-share data) Basic EPS Net income $ 27,116 $ 24,980 $ 25,292 Less: net income allocated to participating securities (339) (432) (628) Net income allocated to common stock $ 26,777 $ 24,548 $ 24,664 Weighted average common shares outstanding 12,253,402 12,418,510 12,528,195 Less: Unvested restricted stock awards considered participating securities (153,482) (217,045) (312,175) Adjusted weighted average common shares used in computing basic EPS 12,099,920 12,201,465 12,216,020 Basic EPS $ 2.21 $ 2.01 $ 2.02 Diluted EPS Net income allocated to common stock $ 26,777 $ 24,548 $ 24,664 Adjusted weighted average common shares used in computing basic EPS 12,099,920 12,201,465 12,216,020 Add: Effect of dilutive stock-based compensation awards 97,877 71,941 33,603 Adjusted weighted average common shares used in computing diluted EPS 12,197,797 12,273,406 12,249,623 Diluted EPS $ 2.20 $ 2.00 $ 2.01 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Stockholders' Equity [Abstract] | |
Schedule of Compliance with Regulatory Capital Requirements under Banking Regulations [Table Text Block] | December 31, 2019 Minimum Capital Well-Capitalized Capital Actual Requirement Requirement Ratio Amount Ratio (1) Amount Ratio Amount (Dollars in thousands) Tier 1 Leverage Capital Marlin Business Services Corp. 16.31% $ 200,702 4% $ 49,225 5% $ 61,532 Marlin Business Bank 13.91% $ 147,810 5% $ 53,124 5% $ 53,124 Common Equity Tier 1 Risk-Based Capital Marlin Business Services Corp. 18.73% $ 200,702 4.5% $ 48,228 6.5% $ 69,663 Marlin Business Bank 15.47% $ 147,810 6.5% $ 66,870 6.5% $ 66,870 Tier 1 Risk-based Capital Marlin Business Services Corp. 18.73% $ 200,702 6% $ 64,305 8% $ 85,739 Marlin Business Bank 15.47% $ 147,810 8% $ 81,199 8% $ 81,199 Total Risk-based Capital Marlin Business Services Corp. 19.99% $ 214,201 8% $ 85,739 10% $ 107,174 Marlin Business Bank 16.73% $ 159,845 15% $ 143,292 10% (1) $ 100,305 December 31, 2018 Minimum Capital Well-Capitalized Capital Actual Requirement Requirement Ratio Amount Ratio (1) Amount Ratio Amount (Dollars in thousands) Tier 1 Leverage Capital Marlin Business Services Corp. 16.38% $ 183,283 4% $ 44,756 5% $ 55,945 Marlin Business Bank 15.55% $ 138,994 5% $ 44,706 5% $ 44,706 Common Equity Tier 1 Risk-Based Capital Marlin Business Services Corp. 17.50% $ 183,283 4.5% $ 47,118 6.5% $ 68,060 Marlin Business Bank 15.99% $ 138,994 6.5% $ 60,862 6.5% $ 60,862 Tier 1 Risk-based Capital Marlin Business Services Corp. 17.50% $ 183,283 6% $ 62,825 8% $ 83,766 Marlin Business Bank 15.99% $ 138,994 8% $ 73,903 8% $ 73,903 Total Risk-based Capital Marlin Business Services Corp. 18.76% $ 196,409 8% $ 83,766 10% $ 104,708 Marlin Business Bank 17.24% $ 149,909 15% $ 130,418 10% (1) $ 91,292 (1) MBB is required to maintain “well-capitalized” status and must also maintain a total risk-based capital ratio greater than 15% pursuant to the FDIC Agreement. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Stock-Based Compensation [Abstract] | |
Stock Options, Black-Scholes option pricing model ,Valuation Assumptions [Table Text Block] | Years Ended December 31, 2018 2017 Risk-free interest rate 2.64% 1.82% Expected life (years) 4.50 4.50 Expected volatility 32.32% 34.62% Expected dividends 1.98% 2.17% |
Schedule of Stock-based Compensation, Stock Options Activity [Table Text Block] | Weighted Average Number of Exercise Price Options Shares Per Share Outstanding, December 31, 2016 41,640 $ 12.37 Granted 115,883 25.75 Exercised (39,416) 12.37 Forfeited (21,122) 24.35 Expired — — Outstanding, December 31, 2017 96,985 $ 25.75 Granted 68,689 28.25 Exercised (909) 25.75 Forfeited (17,827) 26.97 Expired (507) 25.75 Outstanding, December 31, 2018 146,431 $ 26.77 Granted — — Exercised — — Forfeited (6,948) 27.00 Expired (4,324) 25.75 Outstanding, December 31, 2019 135,159 $ 26.80 |
Schedule of Stock-based Compensation, Options Outstanding and Exercisable under Stock Option Plans, by Exercise Price Range [Table Text Block] | Options Outstanding Options Exercisable Weighted Weighted Aggregate Weighted Weighted Aggregate Average Average Intrinsic Average Average Intrinsic Range of Number Remaining Exercise Value Number Remaining Exercise Value Exercise Prices Outstanding Life (Years ) Price (In thousands) Exercisable Life (Years ) Price (In thousands) $ 25.75 78,606 4.2 25.75 — 54,016 4.2 25.75 — $ 28.25 56,553 5.2 28.25 — 20,001 5.2 28.25 — 135,159 4.6 26.80 $ — 74,017 4.5 26.43 $ — |
Schedule of Stock-based Compensation, activity of the non-vested restricted stock [Table Text Block] | Weighted Average Number of Grant-Date Non-vested restricted stock Shares Fair Value Outstanding at December 31, 2016 396,518 $ 16.07 Granted 44,758 25.36 Vested (122,202) 16.19 Forfeited (41,457) 16.07 Outstanding at December 31, 2017 277,617 $ 17.51 Granted 18,206 29.84 Vested (93,764) 15.13 Forfeited (15,456) 17.46 Outstanding at December 31, 2018 186,603 $ 19.91 Granted 18,924 23.19 Vested (56,606) 15.95 Forfeited (4,986) 20.36 Outstanding at December 31, 2019 143,935 $ 21.88 |
Schedule of Stock-based Compensation, Restricted Stock Units Award Activity [Table Text Block] | Weighted Average Number of Grant-Date Performance-based & market-based RSUs RSUs Fair Value Outstanding at December 31, 2016 120,000 $ 9.47 Granted 72,180 24.06 Forfeited (33,627) 14.13 Converted — — Outstanding at December 31, 2017 158,553 $ 15.13 Granted 35,056 28.25 Forfeited (1,688) 25.75 Converted — — Outstanding at December 31, 2018 191,921 $ 17.43 Granted 95,408 18.37 Forfeited (17,853) 19.57 Converted (8,000) 9.47 Cancelled due to non-achievement (4,000) 9.47 Outstanding at December 31, 2019 257,476 18.00 Weighted Average Number of Grant-Date RSUs Fair Value Service-based RSUs Outstanding at December 31, 2016 — $ — Granted 30,653 25.65 Forfeited (4,813) 25.75 Converted — — Outstanding at December 31, 2017 25,840 25.63 Granted 49,463 28.26 Forfeited (5,606) 27.21 Converted (8,441) 25.63 Outstanding at December 31, 2018 61,256 27.61 Granted 74,620 21.50 Forfeited (13,033) 23.84 Converted (22,892) 27.39 Outstanding at December 31, 2019 99,951 23.59 |
Restricted Stock Units Monte Carlo simulation valuation, Valuation Assumptions [Table Text Block] | Year Ended December 31, 2019 2018 2017 Grant date stock price $ 21.50 — 25.75 Risk-free interest rate 2.16 % — % 1.72 % Expected volatility 26.68 % — % 33.42 % Dividend yield — — — |
Condensed Financial Informati_2
Condensed Financial Information of Parent Company (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Condensed Financial Information of Parent [Abstract] | |
Schedule Of Condensed Balance Sheet | December 31, 2019 2018 ASSETS (Dollars in thousands, except per-share data) Investment in and advances to subsidiaries: Bank subsidiary $ 150,745 $ 141,827 Nonbank subsidiaries 64,211 56,684 Total assets $ 214,956 $ 198,511 LIABILITIES AND STOCKHOLDERS’ EQUITY Total liabilities — — Stockholders’ equity: Preferred Stock, $0.01 par value; 5,000,000 shares authorized; none issued — — Common Stock, $0.01 par value; 75,000,000 shares authorized; 12,113,585 and 12,367,724 shares issued and outstanding at December 31, 2019 and 2018, respectively 121 124 Additional paid-in capital 79,665 83,496 Accumulated other comprehensive loss 58 (44) Retained earnings 135,112 114,935 Total stockholders’ equity 214,956 198,511 Total liabilities and stockholders’ equity $ 214,956 $ 198,511 |
Schedule Of Condensed Income Statement | Year Ended December 31, 2019 2018 2017 (Dollars in thousands) Income: Dividends from nonbank subsidiaries $ 14,262 $ 9,931 $ 11,556 Dividends from bank subsidiary 6,000 20,000 6,000 Total revenue 20,262 29,931 17,556 Total expense — — — Income before income taxes and equity in undistributed net income of subsidiaries 20,262 29,931 17,556 Income tax (benefit) expense — — — Equity in undistributed income (loss): Bank subsidiary 8,816 (3,417) 14,571 Nonbank subsidiaries (1,962) (1,534) (6,835) Net Income $ 27,116 $ 24,980 $ 25,292 Other comprehensive income: Reclassification due to adoption of ASU 2016-01, ASU 2018-02 and ASU 2018-03 — 107 — Increase (decrease) in fair value of securities available for sale 138 (7) 68 Tax effect (36) (48) (26) Total other comprehensive income 102 52 42 Comprehensive income $ 27,218 $ 25,032 $ 25,334 |
Schedule Of Condensed Cash Flow Statement | Year Ended December 31, 2019 2018 2017 (Dollars in thousands) Cash flows from operating activities: Net income $ 27,116 $ 24,980 $ 25,292 Adjustments to reconcile net income to net cash from operating activities: Equity in undistributed net (income) losses of subsidiaries (21,116) (4,980) (19,292) Net cash provided by operating activities 6,000 20,000 6,000 Cash flows from investing activities: Capital returned from nonbank subsidiaries 14,262 9,931 11,556 Capital contributed to subsidiaries (6,484) (20,492) (6,941) Net cash provided by (used in) investing activities 7,778 (10,561) 4,615 Cash flows from financing activities: Issuances of common stock 410 402 356 Repurchases of common stock (7,323) (2,908) (4,501) Dividends paid to common stockholders (6,865) (6,956) (6,958) Exercise of stock options - 23 488 Net cash used in financing activities (13,778) (9,439) (10,615) Net increase in total cash and cash equivalents — — — Total cash and cash equivalents, beginning of period — — — Total cash and cash equivalents, end of period $ — $ — $ — |
Selected Quarterly Finacial Dat
Selected Quarterly Finacial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Information [Table Text Block] | Fiscal Year Quarters First Second Third Fourth (Dollars in thousands, except per-share data) Year ended December 31, 2019 Interest income $ 25,883 $ 27,082 $ 27,708 $ 26,747 Fee income 4,042 3,507 3,869 3,787 Interest and fee income 29,925 30,589 31,577 30,534 Interest expense 5,962 6,408 6,561 6,102 Provision for credit losses 5,363 4,756 7,662 10,255 Non-interest income 12,948 7,201 10,362 13,520 Income tax expense 1,602 1,974 3,281 2,880 Net income 5,141 6,115 7,446 8,414 Basic earnings per share 0.42 0.50 0.61 0.69 Diluted earnings per share 0.41 0.49 0.60 0.69 Cash dividends declared per share 0.14 0.14 0.14 0.14 Net investment in leases and loans 1,023,190 1,062,271 1,034,498 1,006,520 Total assets 1,246,725 1,279,983 1,247,416 1,207,443 Year ended December 31, 2018 Interest income $ 23,279 $ 23,964 $ 24,836 $ 24,946 Fee income 3,959 3,876 3,930 4,078 Interest and fee income 27,238 27,840 28,766 29,024 Interest expense 3,399 3,711 4,955 5,349 Provision for credit losses 4,612 4,256 4,893 5,761 Non-interest income 5,234 4,627 4,448 7,125 Income tax expense 1,682 2,057 1,723 2,259 Net income 6,185 6,467 5,906 6,422 Basic earnings per share 0.50 0.52 0.48 0.52 Diluted earnings per share 0.50 0.52 0.47 0.51 Cash dividends declared per share 0.14 0.14 0.14 0.14 Net investment in leases and loans 930,627 963,109 970,425 1,000,740 Total assets 1,071,225 1,113,311 1,126,733 1,167,046 |
The Company (Details)
The Company (Details) - USD ($) $ in Thousands | Sep. 19, 2018 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Entity Information [Line Items] | |||||||||||||
Interest and fee income | $ 30,534 | $ 31,577 | $ 30,589 | $ 29,925 | $ 29,024 | $ 28,766 | $ 27,840 | $ 27,238 | $ 122,625 | $ 112,868 | $ 102,319 | ||
Noninterest Income | $ 13,520 | $ 10,362 | $ 7,201 | 12,948 | $ 7,125 | $ 4,448 | $ 4,627 | $ 5,234 | $ 44,031 | 21,434 | 16,732 | ||
Horizon Keystone Financial (HKF) [Member] | |||||||||||||
Entity Information [Line Items] | |||||||||||||
Finite Lived Intangible Assets Acquired | $ 1,300 | ||||||||||||
Business Acquisition, Date Of Acquisition Agreement | Jan. 4, 2017 | ||||||||||||
Fleet Financing Resources (FFR), [Member] | |||||||||||||
Entity Information [Line Items] | |||||||||||||
Payments To Acquire Businesses, Gross | $ 10,000 | ||||||||||||
Finite Lived Intangible Assets Acquired | 7,600 | ||||||||||||
Business combination revenue of acquiree since acquisition date, estimate | 542,000 | ||||||||||||
Earnout consideration | 5,500 | 3,200 | |||||||||||
Total consideration | $ 15,500 | ||||||||||||
Goodwill relatled to Fleet Financing Resources, FFR | $ 5,600 | ||||||||||||
Interest and fee income | 118,300 | 107,800 | |||||||||||
Noninterest Income | 21,700 | 16,900 | |||||||||||
Net Income | $ 26,300 | $ 26,500 | |||||||||||
Assurance One Ltd Member [Member] | |||||||||||||
Entity Information [Line Items] | |||||||||||||
Entity Incorporation, Date of Incorporation | May 31, 2000 | ||||||||||||
Marlin Business Bank [Member] | |||||||||||||
Entity Information [Line Items] | |||||||||||||
Entity Incorporation, Date of Incorporation | Mar. 12, 2008 | ||||||||||||
Marlin Business Services Corp [Member] | |||||||||||||
Entity Information [Line Items] | |||||||||||||
Entity Incorporation, Date of Incorporation | Aug. 5, 2003 |
Summary of Signicant Accounting
Summary of Signicant Accounting Policies (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 01, 2019 | |
Restricted cash abstract | ||||
Restricted cash related to a settlement agreement | $ 4 | |||
Leases [Abstract] | ||||
Right-of-use assets | $ 9.1 | |||
Lease liabilities | $ 9.1 | |||
Deferred Policy Acquisition Costs | $ 1 | 0.9 | $ 0.9 | |
Company recognized provision for unpaid losses and loss adjustment expenses | $ 0.6 | $ 0.8 | $ 0.8 |
Non-Interest Income (Details)
Non-Interest Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Noninterest Income [Abstract] | |||||||||||
Gain on sale of leases and loans | $ 22,210 | $ 8,363 | $ 2,818 | ||||||||
Insurance premiums written and earned | 8,796 | 8,087 | 7,155 | ||||||||
Servicing income, adjustments | 1,526 | 653 | 864 | ||||||||
Property tax income | 6,401 | 0 | 0 | ||||||||
Net gains and (losses) recognized during the period on equity securities | 104 | (75) | 0 | ||||||||
Non-interest income within the scope of other GAAP topics | 39,037 | 17,028 | 10,837 | ||||||||
Property tax administrative fees on leases | 1,076 | 740 | 751 | ||||||||
ACH payment fees | 316 | 333 | 326 | ||||||||
Insurance policy fees | 2,706 | 2,124 | 1,846 | ||||||||
Referral fees | 543 | 839 | 2,518 | ||||||||
Other | 353 | 370 | 454 | ||||||||
Non-interest income from contracts with customers | 4,994 | 4,406 | 5,895 | ||||||||
Noninterest Income | $ 13,520 | $ 10,362 | $ 7,201 | $ 12,948 | $ 7,125 | $ 4,448 | $ 4,627 | $ 5,234 | $ 44,031 | $ 21,434 | $ 16,732 |
Investment Securities (Summary)
Investment Securities (Summary) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Schedule of Available-for-sale Securities [Line Items] | ||
Total investment securities | $ 11,076 | $ 10,956 |
Asset Backed Securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Total investment securities | 4,332 | 4,915 |
Municipal Bonds [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Total investment securities | 3,129 | 2,612 |
Mutual Fund [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Total investment securities | $ 3,615 | $ 3,429 |
Investment Securities - Equity
Investment Securities - Equity Securities (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Equity Securities, FV-NI, Gain (Loss) [Abstract] | |||
Net gains and (losses) recognized during the period on equity securities | $ 104 | $ (75) | $ 0 |
Less: Net gains and (losses) recognized during the period on equity securities sold during the period | 0 | 0 | 0 |
Unrealized gains and (losses) recognized during the reporting period on equity securities still held at the reporting date | $ 104 | $ (75) | $ 0 |
Investment Securities - Summary
Investment Securities - Summary of available for sale investments (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | $ 11,100 | $ 11,200 |
Estimated fair value | 11,076 | 10,956 |
ABS [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 4,302 | 4,934 |
Gross Unrealized Gain | 33 | 20 |
Gross Unrealized Loss | (3) | (39) |
Estimated fair value | 4,332 | 4,915 |
Municipal securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 3,058 | 2,629 |
Gross Unrealized Gain | 71 | 3 |
Gross Unrealized Loss | 0 | (20) |
Estimated fair value | 3,129 | 2,612 |
Debt Securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 7,360 | 7,563 |
Gross Unrealized Gain | 104 | 23 |
Gross Unrealized Loss | (3) | (59) |
Estimated fair value | $ 7,461 | $ 7,527 |
Investment Securities (Gross Un
Investment Securities (Gross Unrealized Loss and Fair Value of Securities Available for Sale) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months, Gross Unrealized Loss | $ 0 | $ (16) |
Less Than Twelve Months, Fair Value | 0 | 1,436 |
12 Months or Longer, Gross Unrealized Losses | (3) | (43) |
Twelve Months or Longer, Fair Value | 430 | 3,748 |
Total, Gross Unrealized Losses | (3) | (59) |
Total, Fair Value | 430 | 5,184 |
Asset Backed Securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months, Gross Unrealized Loss | 0 | 0 |
Less Than Twelve Months, Fair Value | 0 | 0 |
12 Months or Longer, Gross Unrealized Losses | (3) | (39) |
Twelve Months or Longer, Fair Value | 430 | 3,340 |
Total, Gross Unrealized Losses | (3) | (39) |
Total, Fair Value | 430 | 3,340 |
Municipal securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months, Gross Unrealized Loss | 0 | (16) |
Less Than Twelve Months, Fair Value | 0 | 1,436 |
12 Months or Longer, Gross Unrealized Losses | 0 | (4) |
Twelve Months or Longer, Fair Value | 0 | 408 |
Total, Gross Unrealized Losses | 0 | (20) |
Total, Fair Value | $ 0 | $ 1,844 |
Investment Securuties (Contract
Investment Securuties (Contractual Maturity of Debt Securities) (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Schedule of Available-for-sale Securities [Line Items] | |
Amortized cost - 1 Year or Less | $ 15 |
Amortized cost - Over 1 to 5 years | 2,971 |
Amortized cost - Over 5 to 10 years | 3,374 |
Amortized cost - Over 10 years | 1,000 |
Amortized cost - Total | 7,360 |
Estimated fair value - 1 Year or Less | 15 |
Estimated fair value - Over 1 to 5 years | 2,998 |
Estimated fair value - Over 5 to 10 years | 3,448 |
Estimated fair value - Over 10 years | 1,000 |
Eastimate fair value, Total | $ 7,461 |
Weighted-average Yield, 1 year or less | 4.75% |
Weighted-average Yield, GAAP Basis, over 1 year to 5 | 2.29% |
Weighted-average Yield, GAAP Basis, over 5 to 10 years | 2.85% |
Weighted-average Yield, GAAP Basis, over 10 years | 2.60% |
Weighted-average Yield, GAAP Basis | 2.44% |
Asset Backed Securities [Member] | |
Schedule of Available-for-sale Securities [Line Items] | |
Amortized cost - 1 Year or Less | $ 0 |
Amortized cost - Over 1 to 5 years | 2,522 |
Amortized cost - Over 5 to 10 years | 1,780 |
Amortized cost - Over 10 years | 0 |
Amortized cost - Total | 4,302 |
Municipal securities [Member] | |
Schedule of Available-for-sale Securities [Line Items] | |
Amortized cost - 1 Year or Less | 15 |
Amortized cost - Over 1 to 5 years | 449 |
Amortized cost - Over 5 to 10 years | 1,594 |
Amortized cost - Over 10 years | 1,000 |
Amortized cost - Total | $ 3,058 |
Net Investment in Leases and _3
Net Investment in Leases and Loans (Narratives) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Net Investment in Leases and Loans [Abstract] | ||
Initial direct costs and origination costs | $ 20,500 | $ 20,500 |
Product Information [Line Items] | ||
Estimated Residual Value of Equipment | 29,342 | 27,646 |
Non-accrual leases and loans, end of period | 6,387 | 4,212 |
Renegotiated leases and loans, end of period | 2,900 | 3,600 |
Borrowings [Line Items] | ||
Debt Instrument, Unused Borrowing Capacity, Amount | 35,600 | |
Servicing Rights | 340,000 | |
Servicing Liability | 2,500 | 1,400 |
Copier Product [Member] | ||
Product Information [Line Items] | ||
Estimated Residual Value of Equipment | 23,400 | $ 23,600 |
Leases Pledged as Collateral [Member] | ||
Borrowings [Line Items] | ||
Loans and Leases Receivable, Collateral for Long-term Borrowings | $ 76,100 |
Net Investment in Leases and _4
Net Investment in Leases and Loans (Net Investment Components) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Net Investment in Leases and Loans [Abstract] | ||||||||||
Minimum lease payments receivable | $ 457,602 | $ 530,867 | ||||||||
Estimated Residual Value of Equipment | 29,342 | 27,646 | ||||||||
Unearned Lease Income, Including Initial Direct Costs and Fees Deferred | (59,746) | (68,376) | ||||||||
Security Deposits | (590) | (838) | ||||||||
Total leases | 426,608 | 489,299 | ||||||||
Commercial loans, net of origination costs and fees deferred | ||||||||||
Working capital loans | 60,942 | 36,856 | ||||||||
CRA | 1,398 | 1,466 | ||||||||
Equipment loans | 464,655 | 423,168 | ||||||||
CVG Loans | 74,612 | 66,051 | ||||||||
Total commercial loans | 601,607 | 527,541 | ||||||||
Allowance for Credit Losses | (21,695) | (16,100) | $ (14,851) | $ (10,937) | ||||||
Net investment in leases and loans | $ 1,006,520 | $ 1,034,498 | $ 1,062,271 | $ 1,023,190 | $ 1,000,740 | $ 970,425 | $ 963,109 | $ 930,627 |
Net Investment in Leases and _5
Net Investment in Leases and Loans (Future Minimum Lease Payments Receivable Schedule) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Future Minimum Lease Payments Receivable Schedule [Abstract] | ||
2020 | $ 183,266 | |
2021 | 130,656 | |
2022 | 82,316 | |
2023 | 43,390 | |
2024 | 15,768 | |
Thereafter | 2,206 | |
Minimum Lease Payments Receivable | 457,602 | $ 530,867 |
Future Scheduled Income Amortization [Abstract] | ||
2020 | 29,961 | |
2021 | 16,950 | |
2022 | 8,454 | |
2023 | 3,361 | |
2024 | 805 | |
Thereafter | 215 | |
Unearned Lease Income, Including Initial Direct Costs and Fees Deferred | $ 59,746 | $ 68,376 |
Net Investment in Leases and _6
Net Investment in Leases and Loans - Lease income and Information related to portfolio sales (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Lease Income [Abstract] | |||
Lease Income | $ 41,891 | $ 48,914 | $ 56,428 |
Interest Income [Member] | |||
Lease Income [Abstract] | |||
Sales of leases and loans | 310,415 | 138,995 | 66,744 |
Gain on sale of leases and loans | $ 22,206 | $ 8,364 | $ 2,818 |
Concentrations of Risk (Narrati
Concentrations of Risk (Narratives) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Concentration Risk [Line Items] | |||
Impairment of Value Recorded in Period | $ 0 | $ 0 | $ 0 |
Geographic Concentration Risk [Member] | Maximum [Member] | |||
Concentration Risk [Line Items] | |||
Concentration Risk, Percentage | 7.00% | 7.00% | |
Single Vendor Source [Member] | Maximum [Member] | |||
Concentration Risk [Line Items] | |||
Concentration Risk, Percentage | 4.00% | 4.00% | |
Single Obligor [Member] | Maximum [Member] | |||
Concentration Risk [Line Items] | |||
Concentration Risk, Percentage | 1.00% | 1.00% | |
Copier Product [Member] | |||
Concentration Risk [Line Items] | |||
Concentration Risk, Percentage | 79.70% | 85.40% | |
Other Products [Member] | Maximum [Member] | |||
Concentration Risk [Line Items] | |||
Concentration Risk, Percentage | 10.00% | 10.00% | |
California [Member] | |||
Concentration Risk [Line Items] | |||
Concentration Risk, Percentage | 14.00% | 14.00% | |
Texas [Member] | |||
Concentration Risk [Line Items] | |||
Concentration Risk, Percentage | 12.00% | 12.00% | |
All Other Individual Member [Member] | Geographic Concentration Risk [Member] | Maximum [Member] | |||
Concentration Risk [Line Items] | |||
Concentration Risk, Percentage | 7.00% | ||
Florida [Member] | |||
Concentration Risk [Line Items] | |||
Concentration Risk, Percentage | 10.00% | 10.00% |
Allowance for Credit Losses (Na
Allowance for Credit Losses (Narratives) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Allowance for Credit Losses [Line Items] | ||||
Loans and Leases Receivable, Allowance | $ 21,695 | $ 16,100 | $ 14,851 | $ 10,937 |
Working capital Loan [Member] | ||||
Allowance for Credit Losses [Line Items] | ||||
Loans and Leases Receivable, Allowance | $ (1,899) | $ 1,467 | $ 1,036 | $ 760 |
Allowance for Credit Losses (De
Allowance for Credit Losses (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Allowance for Credit Losses [Roll Forward] | |||||||||||
Allowance for credit losses, beginning of period | $ 16,100 | $ 14,851 | $ 16,100 | $ 14,851 | $ 10,937 | ||||||
Charge-offs | (25,071) | (20,593) | (16,716) | ||||||||
Recoveries | 2,630 | 2,320 | 2,236 | ||||||||
Net charge-offs | (22,441) | (18,273) | (14,480) | ||||||||
Provision for credit losses | $ 10,255 | $ 7,662 | $ 4,756 | 5,363 | $ 5,761 | $ 4,893 | $ 4,256 | 4,612 | 28,036 | 19,522 | 18,394 |
Allowance for credit losses, end of period | 21,695 | 16,100 | 21,695 | 16,100 | 14,851 | ||||||
Ending lease or loan balance | 1,007,706 | 996,383 | 1,007,706 | 996,383 | 911,242 | ||||||
Ending balance: individually evaluated for impairment | 0 | 0 | |||||||||
Working capital Loan [Member] | |||||||||||
Allowance for Credit Losses [Roll Forward] | |||||||||||
Allowance for credit losses, beginning of period | 1,467 | 1,036 | 1,467 | 1,036 | 760 | ||||||
Charge-offs | (2,868) | (1,537) | (1,219) | ||||||||
Recoveries | 337 | 60 | 121 | ||||||||
Net charge-offs | (2,531) | (1,477) | (1,098) | ||||||||
Provision for credit losses | 2,963 | 1,908 | 1,374 | ||||||||
Allowance for credit losses, end of period | (1,899) | 1,467 | (1,899) | 1,467 | 1,036 | ||||||
Ending lease or loan balance | 60,412 | 36,478 | 60,412 | 36,478 | 27,810 | ||||||
Ending balance: individually evaluated for impairment | 0 | 0 | |||||||||
CRA [member] | |||||||||||
Allowance for Credit Losses [Roll Forward] | |||||||||||
Allowance for credit losses, beginning of period | 0 | 0 | 0 | 0 | 0 | ||||||
Charge-offs | 0 | 0 | 0 | ||||||||
Recoveries | 0 | 0 | 0 | ||||||||
Net charge-offs | 0 | 0 | 0 | ||||||||
Provision for credit losses | 0 | 0 | 0 | ||||||||
Allowance for credit losses, end of period | 0 | 0 | 0 | 0 | 0 | ||||||
Ending lease or loan balance | 1,398 | 1,466 | 1,398 | 1,466 | 1,222 | ||||||
Ending balance: individually evaluated for impairment | 0 | 0 | |||||||||
Equipment Finance [Member] | |||||||||||
Allowance for Credit Losses [Roll Forward] | |||||||||||
Allowance for credit losses, beginning of period | 13,531 | 12,663 | 13,531 | 12,663 | 9,808 | ||||||
Charge-offs | (20,328) | (18,149) | (14,343) | ||||||||
Recoveries | 2,164 | 2,199 | 2,066 | ||||||||
Net charge-offs | (18,164) | (15,950) | (12,277) | ||||||||
Provision for credit losses | 22,967 | 16,818 | 15,132 | ||||||||
Allowance for credit losses, end of period | (18,334) | 13,531 | (18,334) | 13,531 | 12,663 | ||||||
Ending lease or loan balance | 863,532 | 890,785 | 863,532 | 890,785 | 826,880 | ||||||
Ending balance: individually evaluated for impairment | 0 | 0 | |||||||||
CVG [member] | |||||||||||
Allowance for Credit Losses [Roll Forward] | |||||||||||
Allowance for credit losses, beginning of period | $ 1,102 | $ 1,152 | 1,102 | 1,152 | 369 | ||||||
Charge-offs | (1,875) | (907) | (1,154) | ||||||||
Recoveries | 129 | 61 | 49 | ||||||||
Net charge-offs | (1,746) | (846) | (1,105) | ||||||||
Provision for credit losses | 2,106 | 796 | 1,888 | ||||||||
Allowance for credit losses, end of period | (1,462) | 1,102 | (1,462) | 1,102 | 1,152 | ||||||
Ending lease or loan balance | 82,363 | $ 67,654 | 82,363 | $ 67,654 | $ 55,330 | ||||||
Ending balance: individually evaluated for impairment | $ 0 | $ 0 |
Allowance for Credit Losses (Po
Allowance for Credit Losses (Portfolio Amounts by Classification) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | $ 1,007,706 | $ 996,383 | $ 911,242 |
Working capital Loan [Member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 60,412 | 36,478 | 27,810 |
CRA [member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 1,398 | 1,466 | 1,222 |
Equipment Finance [Member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 863,532 | 890,785 | 826,880 |
CVG [member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 82,363 | 67,654 | $ 55,330 |
Pass [Member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 990,568 | 982,997 | |
Pass [Member] | Working capital Loan [Member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 59,081 | 35,793 | |
Pass [Member] | CRA [member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 1,398 | 1,466 | |
Pass [Member] | Equipment Finance [Member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 849,605 | 879,275 | |
Pass [Member] | CVG [member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 80,484 | 66,463 | |
Special Mention [Member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 5,625 | 4,566 | |
Special Mention [Member] | Working capital Loan [Member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 143 | 47 | |
Special Mention [Member] | CRA [member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 0 | 0 | |
Special Mention [Member] | Equipment Finance [Member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 5,164 | 4,373 | |
Special Mention [Member] | CVG [member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 318 | 146 | |
Substandard [Member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 4,727 | 4,265 | |
Substandard [Member] | Working capital Loan [Member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 242 | 145 | |
Substandard [Member] | CRA [member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 0 | 0 | |
Substandard [Member] | Equipment Finance [Member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 3,528 | 3,460 | |
Substandard [Member] | CVG [member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 957 | 660 | |
Doubtful [Member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 3,755 | 2,811 | |
Doubtful [Member] | Working capital Loan [Member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 674 | 300 | |
Doubtful [Member] | CRA [member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 0 | 0 | |
Doubtful [Member] | Equipment Finance [Member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 2,857 | 2,353 | |
Doubtful [Member] | CVG [member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 224 | 158 | |
Loss [Member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 3,028 | 1,744 | |
Loss [Member] | Working capital Loan [Member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 272 | 193 | |
Loss [Member] | CRA [member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 0 | 0 | |
Loss [Member] | Equipment Finance [Member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | 2,378 | 1,324 | |
Loss [Member] | CVG [member] | |||
Amount of portfolio [Line Items] | |||
Total net finance receivables, end of period | $ 378 | $ 227 |
Allowance for Credit Losses (_2
Allowance for Credit Losses (Delinquencies and Non-accrual) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | |
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Financing Receivable, Recorded Investment, Past Due | $ 16,077 | $ 12,295 | |
Financing Receivable, Recorded Investment, Current | 1,125,060 | 1,117,222 | |
Total gross finance receivables, end of period | [1] | 1,141,137 | 1,129,517 |
Non-accrual leases and loans, end of period | 6,387 | 4,212 | |
Working capital Loan [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Financing Receivable, Recorded Investment, Past Due | 855 | 492 | |
Financing Receivable, Recorded Investment, Current | 59,557 | 35,986 | |
Total gross finance receivables, end of period | 60,412 | 36,478 | |
Non-accrual leases and loans, end of period | 946 | 492 | |
CRA [member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Financing Receivable, Recorded Investment, Past Due | 0 | 0 | |
Financing Receivable, Recorded Investment, Current | 1,398 | 1,466 | |
Total gross finance receivables, end of period | 1,398 | 1,466 | |
Non-accrual leases and loans, end of period | 0 | 0 | |
Equipment Finance [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Financing Receivable, Recorded Investment, Past Due | 14,110 | 11,189 | |
Financing Receivable, Recorded Investment, Current | 969,761 | 1,001,363 | |
Total gross finance receivables, end of period | [2] | 983,871 | 1,012,552 |
Non-accrual leases and loans, end of period | 5,006 | 3,529 | |
CVG [member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Financing Receivable, Recorded Investment, Past Due | 1,112 | 614 | |
Financing Receivable, Recorded Investment, Current | 94,344 | 78,407 | |
Total gross finance receivables, end of period | 95,456 | 79,021 | |
Non-accrual leases and loans, end of period | 435 | 191 | |
Financing Receivables, 30 to 59 Days Past Due [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Financing Receivable, Recorded Investment, Past Due | 6,389 | 5,003 | |
Financing Receivables, 30 to 59 Days Past Due [Member] | Working capital Loan [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Financing Receivable, Recorded Investment, Past Due | 584 | 300 | |
Financing Receivables, 30 to 59 Days Past Due [Member] | CRA [member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Financing Receivable, Recorded Investment, Past Due | 0 | 0 | |
Financing Receivables, 30 to 59 Days Past Due [Member] | Equipment Finance [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Financing Receivable, Recorded Investment, Past Due | 5,399 | 4,537 | |
Financing Receivables, 30 to 59 Days Past Due [Member] | CVG [member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Financing Receivable, Recorded Investment, Past Due | 406 | 166 | |
Financing Receivables, 60 to 89 Days Past Due [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Financing Receivable, Recorded Investment, Past Due | 4,044 | 3,431 | |
Financing Receivables, 60 to 89 Days Past Due [Member] | Working capital Loan [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Financing Receivable, Recorded Investment, Past Due | 68 | 51 | |
Financing Receivables, 60 to 89 Days Past Due [Member] | CRA [member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Financing Receivable, Recorded Investment, Past Due | 0 | 0 | |
Financing Receivables, 60 to 89 Days Past Due [Member] | Equipment Finance [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Financing Receivable, Recorded Investment, Past Due | 3,705 | 3,123 | |
Financing Receivables, 60 to 89 Days Past Due [Member] | CVG [member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Financing Receivable, Recorded Investment, Past Due | 271 | 257 | |
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Financing Receivable, Recorded Investment, Past Due | 5,644 | 3,861 | |
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | Working capital Loan [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Financing Receivable, Recorded Investment, Past Due | 203 | 141 | |
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | CRA [member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Financing Receivable, Recorded Investment, Past Due | 0 | 0 | |
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | Equipment Finance [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Financing Receivable, Recorded Investment, Past Due | 5,006 | 3,529 | |
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | CVG [member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Financing Receivable, Recorded Investment, Past Due | $ 435 | $ 191 | |
[1] | (2) Represents total minimum lease and loan payments receivable for Equipment Finance and CVG and as a percentage of principal outstanding for Working Capital Loans and CRA. For information on the Company’s loan sales activity, see Note 5 , Net Investment in Leases and Loans . | ||
[2] | (2 ) Equipment Finance consists of Equipment Finance Agreements, Install Purchase Agreements, and other leases and loans. (3) As of December 31, 2019 and December 31, 2018 , the Company determined that n o leases or loans required individual evaluation, and as of December 31, 2017 all leases and loans were collectively evaluated. |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (Narratives) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||
Mar. 31, 2019 | Sep. 30, 2018 | Mar. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | |
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Goodwill | $ 6,735,000 | $ 7,360,000 | |||
Goodwill Impairment Loss | 0 | ||||
Reduction of goodwill | (625,000) | ||||
Indefinite-lived intangible assets | 0 | ||||
Amortization of Intangible Assets | 900,000 | 400,000 | |||
Impairment Of Intangible Assets, Finite-lived | $ 0 | 0 | |||
Horizon Keystone Financial (HKF) [Member] | |||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Goodwill | $ 1,200,000 | ||||
Finite Lived Intangible Assets Acquired | $ 1,300,000 | ||||
Acquired Finite Lived Intangible Assets Weighted Average Useful Life | 8 years 8 months 12 days | ||||
Business Acquisition, Date Of Acquisition Agreement | Jan. 4, 2017 | ||||
Fleet Financing Resources (FFR), [Member] | |||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Goodwill | $ 5,600,000 | ||||
Reduction of goodwill | 600,000 | ||||
Goodwill Acquired During Period | 5,600,000 | ||||
Finite Lived Intangible Assets Acquired | $ 7,600,000 | ||||
Acquired Finite Lived Intangible Assets Weighted Average Useful Life | 10 years 9 months 18 days | ||||
Fleet Financing Resources (FFR), [Member] | Previously Reported [Member] | |||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Goodwill | $ 6,200,000 | ||||
Finite Lived Intangible Assets Acquired | $ 7,200,000 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Summary of Changes In Carrying Amount of Goodwill (Details) | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill, Beginning Balance | $ 7,360,000 |
Changes | 625,000 |
Goodwill, Ending Balance | $ 6,735,000 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Intangible Assets (Detail) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Finite Lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 8,980,000 | $ 8,502,000 |
Accumulated Amortization | 1,519,000 | 590,000 |
Net Book Value | 7,461,000 | 7,912,000 |
Lender Relationships [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 1,630,000 | 1,590,000 |
Accumulated Amortization | 519,000 | 271,000 |
Net Book Value | $ 1,111,000 | $ 1,319,000 |
Lender Relationships [Member] | Maximum [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Useful Life | 10 years | 10 years |
Lender Relationships [Member] | Minimum [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Useful Life | 3 years | 3 years |
Vendor Relationships [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Useful Life | 11 years | 11 years |
Gross carrying amount | $ 7,290,000 | $ 6,852,000 |
Accumulated Amortization | 974,000 | 302,000 |
Net Book Value | $ 6,316,000 | $ 6,550,000 |
Corporate trade name [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Useful Life | 7 years | 7 years |
Gross carrying amount | $ 60,000 | $ 60,000 |
Accumulated Amortization | 26,000 | 17,000 |
Net Book Value | $ 34,000 | $ 43,000 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Amortization expense for the next five years (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |
2020 | $ 798 |
2021 | 798 |
2022 | 798 |
2023 | 798 |
2024 | $ 790 |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Depreciation and Amortization Expense [Abstract] | |||
Depreciation and Amortization Expense | $ 1,800 | $ 1,600 | $ 1,500 |
Furniture and Equipment | 4,035 | 2,986 | |
Computer Systems and Equipment | 18,584 | 17,234 | |
Leasehold Improvements | 3,552 | 1,197 | |
Total Property and Equipment | 26,171 | 21,417 | |
Accumulated Depreciation and Amortization | (18,283) | (17,100) | |
Property and equipment, Net, Total | $ 7,888 | $ 4,317 | |
Furniture and Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Estimated Useful Lives | P7Y | ||
Computer Systems and Equipment [Member] | Minimum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Estimated Useful Lives | P3Y | ||
Computer Systems and Equipment [Member] | Maximum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Estimated Useful Lives | P5Y | ||
Leasehold Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Estimated Useful Lives | Shorter of estimated useful life or remaining lease term |
Other Assets (Details)
Other Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Other Assets [Abstract] | ||
Accrued fees receivable | $ 3,509 | $ 3,354 |
Prepaid expenses | 2,872 | 2,447 |
Federal Reserve Bank Stock | 1,711 | 1,711 |
Other assets, miscellaneous | 2,361 | 2,144 |
Other assets, total | $ 10,453 | $ 9,656 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Lessee, Lease, Description [Line Items] | ||
Lessee Operating Lease Description | the Company leases all six of its office locations including its executive offices in Mt. Laurel, New Jersey, and its offices in or near Salt Lake City, Utah; Portsmouth, New Hampshire; Highlands Ranch, Colorado; Corona, California; and Philadelphia, Pennsylvania. | |
Number Of Offices | 6 | |
Lessee, Operating Lease, Option to Extend | Four of the office leases include options to extend for terms of three to ten years. | |
Operating lease right-of-use assets | $ 8,863,000 | $ 0 |
Operating lease liabilities | $ 9,730,000 | $ 0 |
Leases - Components of lease ex
Leases - Components of lease expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Components of lease expense [Abstract] | |||
Operating lease cost | $ 1,201 | $ 1,131 | $ 1,062 |
Finance lease costs | 0 | 7 | 5 |
Short-term lease cost | 368 | 0 | 0 |
Total lease cost | $ 1,569 | $ 1,138 | $ 1,067 |
Leases - Other information rela
Leases - Other information related to the Company's leases (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Details of lease expense [Abstract] | |
Operating Lease, Weighted Average Remaining Lease Term | 11 years 3 months 18 days |
OperatingLeaseWeightedAverageDiscountRatePercent | 3.30% |
Cash Flow, Operating Activities, Lessee [Abstract] | |
Operating Lease Payments | $ 424 |
Right-of-use assets obtained in exchange for new operating lease obligations | $ 756 |
Leases - Maturities of lease li
Leases - Maturities of lease liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | ||
2020 | $ 1,288 | |
2021 | 1,081 | |
2022 | 992 | |
2023 | 914 | |
2024 | 896 | |
Thereafter | 6,557 | |
Total lease payments | 11,728 | |
Less: imputed interest | (1,998) | |
Total | $ 9,730 | $ 0 |
Commitments and Contingencies (
Commitments and Contingencies (Narratives) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Commitments and Contingencies [Abstract] | |||
Loan Participation Ownership Percentage, minimum | 0.80% | ||
Loan Participation Ownership Percentage, maximum | 1.20% | ||
Unfunded Loan Commitments | $ 0.6 | $ 0.5 | |
Membership Expiration Date | Sep. 30, 2020 | ||
Restitution Due To Customers | $ 4 | ||
Repayment of restitution due to customer | $ 4 |
Deposits (Details)
Deposits (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Contractual Maturities of Time Deposits [Abstract] | ||
Deposits, Total | $ 839,132,000 | $ 755,776,000 |
Marlin Business Bank [Member] | ||
Contractual Maturities of Time Deposits [Abstract] | ||
2020 | 388,615,000 | |
2021 | 216,157,000 | |
2022 | 118,792,000 | |
2023 | 60,640,000 | |
2024 | 31,515,000 | |
Deposits, Total | 815,719,000 | |
Money market deposit accounts | 23,400,000 | |
Maximum time deposit liability denomination | 250,000 | |
Cash, FDIC Insured Amount | $ 250,000 | |
Weighted average all-in interest rate of deposit liabilities outstanding | 2.40% | |
Marlin Business Bank [Member] | MBB Certificate of Deposit [Member] | ||
Contractual Maturities of Time Deposits [Abstract] | ||
Maximum time deposit liability denomination | $ 250,000 |
Long-term Borrowings (Narrative
Long-term Borrowings (Narratives) (Details) - USD ($) | 12 Months Ended | ||||
Dec. 31, 2019 | Dec. 31, 2018 | Nov. 20, 2018 | Jul. 27, 2018 | Dec. 31, 2017 | |
Debt Instrument Terms [Line Items] | |||||
Debt Instrument, Unused Borrowing Capacity, Amount | $ 35,600,000 | ||||
Line of credit | $ 0 | $ 0 | |||
Debt Instrument, Weighted Average Interest Rate | 3.54% | ||||
Debt Instrument Collateral Amount | $ 84,600,000 | ||||
Term securitization 2018-1 | 76,563,000 | 151,233,000 | $ 201,650,000 | ||
Restricted interest-earning deposits with banks | 6,931,000 | 14,045,000 | $ 0 | ||
Variable Interest Entity, Primary Beneficiary [Member] | |||||
Debt Instrument Terms [Line Items] | |||||
Restricted interest-earning deposits with banks | $ 6,900,000 | 10,000,000 | |||
Revolving line of credit [Member] | |||||
Debt Instrument Terms [Line Items] | |||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 5,000,000 | ||||
Debt Instrument, Maturity Date | Nov. 20, 2020 | ||||
Federal Funds [Member] | |||||
Debt Instrument Terms [Line Items] | |||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 25,000,000 | ||||
Line of credit | 0 | $ 0 | |||
Federal Reserve Discount Window [Member] | |||||
Debt Instrument Terms [Line Items] | |||||
Debt Instrument, Unused Borrowing Capacity, Amount | 32,800,000 | ||||
Net investment in leases pledged | $ 35,600,000 |
Long-term borrowings (Details)
Long-term borrowings (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Jul. 27, 2018 |
Variable Interest Entity [Line Items] | |||
Term securitization 2018-1 | $ 76,563 | $ 151,233 | $ 201,650 |
Unamortized debt issuance costs | (472) | (1,178) | |
Variable Interest Entity, Primary Beneficiary [Member] | |||
Variable Interest Entity [Line Items] | |||
Long-term borrowings related to consolidated VIEs | $ 76,091 | $ 150,055 |
Long-term Borrowings (term note
Long-term Borrowings (term note securitization) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Jul. 27, 2018 | |
Borrowings [Line Items] | |||
Term note securitization | $ 76,563 | $ 151,233 | $ 201,650 |
Original coupon rate | 3.05% | ||
Class A-1 [Member] | |||
Borrowings [Line Items] | |||
Term note securitization | $ 0 | 77,400 | |
Final maturity date | Jul. 22, 2019 | ||
Original coupon rate | 2.55% | ||
Class A-2 [Member] | |||
Borrowings [Line Items] | |||
Term note securitization | $ 8,013 | 55,700 | |
Final maturity date | Oct. 20, 2020 | ||
Original coupon rate | 3.05% | ||
Class A-3 [Member] | |||
Borrowings [Line Items] | |||
Term note securitization | $ 36,910 | 36,910 | |
Final maturity date | Apr. 20, 2023 | ||
Original coupon rate | 3.36% | ||
Class B [Member] | |||
Borrowings [Line Items] | |||
Term note securitization | $ 10,400 | 10,400 | |
Final maturity date | May 22, 2023 | ||
Original coupon rate | 3.54% | ||
Class C [Member] | |||
Borrowings [Line Items] | |||
Term note securitization | $ 11,390 | 11,390 | |
Final maturity date | Jun. 20, 2023 | ||
Original coupon rate | 3.70% | ||
Class D [Member] | |||
Borrowings [Line Items] | |||
Term note securitization | $ 5,470 | 5,470 | |
Final maturity date | Jul. 20, 2023 | ||
Original coupon rate | 3.99% | ||
Class E [Member] | |||
Borrowings [Line Items] | |||
Term note securitization | $ 4,380 | $ 4,380 | |
Final maturity date | May 20, 2025 | ||
Original coupon rate | 5.02% |
Long-term Borrowings (Future Pa
Long-term Borrowings (Future Payments) (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 | Jul. 27, 2018 |
Maturities of Long-term Debt [Abstract] | |||
Principal 2020 | $ 44,352,000 | ||
Principal 2021 | 23,629,000 | ||
Princiapl 2022 | 8,582,000 | ||
Long-term borrowings, total | 76,563,000 | $ 151,233,000 | $ 201,650,000 |
Interest, 2020 | 1,991,000 | ||
Interest, 2021 | 813,000 | ||
Interest, 2022 | 159,000 | ||
Total interest portion on long-term debt | $ 2,963,000 |
Fair Value Measurements and D_3
Fair Value Measurements and Disclosures about the Fair Value of Financial Instruments (Narrative) (Details) $ in Millions | Dec. 31, 2019USD ($) |
Fair Value Disclosures [Abstract] | |
Money market funds | $ 56.3 |
Fair Value Measurements and D_4
Fair Value Measurements and Disclosures about the Fair Value of Financial Instruments (Balances Measured at Fair Value on a Recurring Basis) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | $ 11,076 | $ 10,956 |
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | Asset Backed Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | Municipal Bonds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 0 | 0 |
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | Mutual Fund [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 3,615 | 3,429 |
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Asset Backed Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 4,332 | 4,915 |
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Municipal Bonds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | 3,129 | 2,612 |
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Mutual Fund [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale | $ 0 | $ 0 |
Fair Value Measurements and D_5
Fair Value Measurements and Disclosures about the Fair Value of Financial Instruments (Estimated Fair Values and Carrying Amounts) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Jul. 27, 2018 | Dec. 31, 2017 |
Assets, Fair Value Disclosure [Abstract] | ||||
Total cash and cash equivalents, carrying value | $ 123,096 | $ 97,156 | $ 67,146 | |
Time deposits | 12,927 | 9,659 | ||
Restricted interest-earning deposits with banks | 6,931 | 14,045 | $ 0 | |
Loans, net of allowance | 601,607 | 527,541 | ||
Federal Reserve Bank Stock | 1,711 | 1,711 | ||
Liabilities, Fair Value Disclosure [Abstract] | ||||
Deposits | 839,132 | 755,776 | ||
Long-term borrowings | 76,563 | 151,233 | $ 201,650 | |
Carrying (Reported) Amount, Fair Value Disclosure [Member] | ||||
Assets, Fair Value Disclosure [Abstract] | ||||
Total cash and cash equivalents, carrying value | 123,096 | 97,156 | ||
Time deposits | 12,927 | 9,659 | ||
Restricted interest-earning deposits with banks | 6,931 | 14,045 | ||
Loans, net of allowance | 588,688 | 518,697 | ||
Federal Reserve Bank Stock | 1,711 | 1,711 | ||
Liabilities, Fair Value Disclosure [Abstract] | ||||
Deposits | 839,132 | 755,776 | ||
Long-term borrowings | 76,091 | 150,055 | ||
Estimate of Fair Value, Fair Value Disclosure [Member] | ||||
Assets, Fair Value Disclosure [Abstract] | ||||
Total cash and cash equivalents, carrying value | 123,096 | 97,156 | ||
Time deposits | 12,970 | 9,614 | ||
Restricted interest-earning deposits with banks | 6,931 | 14,045 | ||
Loans, net of allowance | 593,406 | 515,754 | ||
Federal Reserve Bank Stock | 1,711 | 1,711 | ||
Liabilities, Fair Value Disclosure [Abstract] | ||||
Deposits | 846,304 | 722,682 | ||
Long-term borrowings | $ 76,781 | $ 149,912 |
Income Taxes (Narratives) (Deta
Income Taxes (Narratives) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Examination [Line Items] | |||
Statutory Federal Income Tax Rate | 21.00% | 21.00% | 35.00% |
Deferred Income Tax Expense (Benefit) | $ 7,668,000 | $ 5,813,000 | $ 1,516,000 |
Unrecognized Tax Benefits | 0 | ||
Income Tax Examination, Penalties and Interest Accrued | $ 0 | ||
Operating loss carryforwards limitation percentage | 80.00% | ||
Operating Loss Carryforwards, Limitations on Use | Federal net operating losses are post tax-reform related and therefore cannot fully offset current federal tax expense due to utilization being limited to 80% of federal taxable income. | ||
Federal [Member] | |||
Income Tax Examination [Line Items] | |||
Operating Loss Carryforwards | $ 15,700,000 | ||
TCJA [Member] | |||
Income Tax Examination [Line Items] | |||
Increase (decrease) in deferred tax assets | (4,500,000) | ||
Increase (Decrease) in Deferred Liabilities | (14,700,000) | ||
Deferred Income Tax Expense (Benefit) | 10,200,000 | ||
State and federal tax authority [Member] | |||
Income Tax Examination [Line Items] | |||
Operating Loss Carryforwards | $ 27,500,000 | $ 35,600,000 | |
Minimum [Member] | |||
Income Tax Examination [Line Items] | |||
Operating Loss Carryforwards, Expiration Date | Jan. 1, 2029 | ||
Minimum [Member] | TCJA [Member] | |||
Income Tax Examination [Line Items] | |||
Statutory Federal Income Tax Rate | 21.00% | ||
Maximum [Member] | |||
Income Tax Examination [Line Items] | |||
Operating Loss Carryforwards, Expiration Date | Dec. 31, 2039 | ||
Maximum [Member] | TCJA [Member] | |||
Income Tax Examination [Line Items] | |||
Statutory Federal Income Tax Rate | 35.00% |
Income Taxes (Components of Pro
Income Taxes (Components of Provision) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Taxes [Abstract] | |||||||||||
Current Federal Tax Expense (Benefit) | $ 240,000 | $ 201,000 | $ (4,591,000) | ||||||||
Current State and Local Tax Expense (Benefit) | 1,829,000 | 1,707,000 | 1,419,000 | ||||||||
Current Income Tax Expense (Benefit), Total | 2,069,000 | 1,908,000 | (3,172,000) | ||||||||
Deferred Federal Income Tax Expense (Benefit) | 6,896,000 | 6,133,000 | 986,000 | ||||||||
Deferred State and Local Income Tax Expense (Benefit) | 772,000 | (320,000) | 530,000 | ||||||||
Deferred Income Tax Expense (Benefit), Total | 7,668,000 | 5,813,000 | 1,516,000 | ||||||||
Income Tax Expense (Benefit), Total | $ 2,880,000 | $ 3,281,000 | $ 1,974,000 | $ 1,602,000 | $ 2,259,000 | $ 1,723,000 | $ 2,057,000 | $ 1,682,000 | $ 9,737,000 | $ 7,721,000 | $ (1,656,000) |
Income Taxes (Net Deferred Tax
Income Taxes (Net Deferred Tax Liability Components) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Components of Deferred Tax Assets [Abstract] | ||
Allowance for credit losses | $ 5,830 | $ 4,484 |
Net operating loss | 4,002 | 5,443 |
Accrued Expenses | 1,003 | 2,111 |
Deferred Income | 1,656 | 1,723 |
Deferred Compensation | 1,476 | 1,416 |
Other Comprehensive Income | 20 | 55 |
Deferred Tax Asset, Other | 144 | 743 |
Gross deferred income tax assets | 14,131 | 15,975 |
Deferred Tax Assets, Valuation Allowance | (258) | 0 |
Deferred tax assets, net of valuation allowance | 13,873 | 15,975 |
Components of Deferred Tax Liabilities [Abstract] | ||
Lease Accounting | (41,770) | (35,472) |
Deferred Acquisition Costs | (1,960) | (2,480) |
Depreciation | (971) | (583) |
Deferred Income Tax Liabilities | (44,701) | (38,535) |
Net Deferred Income Tax Liability | $ (30,828) | $ (22,560) |
Income Taxes (Statutory Rate Re
Income Taxes (Statutory Rate Reconciliation) (Details) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Effective Income Tax Rate, Continuing Operations, Tax Rate Reconciliation [Abstract] | |||
Statutory Federal Income Tax Rate | 21.00% | 21.00% | 35.00% |
State Taxes, Net of Federal Benefit | 5.60% | 3.30% | 2.70% |
Other Permanent Differences | 0.30% | 0.20% | (0.10%) |
Interest on Amended Returns | (0.20%) | (0.70%) | (1.50%) |
Excess stock based compensation | 0.00% | 0.00% | (43.40%) |
Other Adjustments | (0.20%) | (0.20%) | 0.30% |
Effective Income Tax Rate | 26.40% | 23.60% | (7.00%) |
Earnings Per Common Share (EPS
Earnings Per Common Share (EPS Basic) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Earnings Per Share, Basic [Abstract] | |||||||||||
Net Income | $ 8,414,000 | $ 7,446,000 | $ 6,115,000 | $ 5,141,000 | $ 6,422,000 | $ 5,906,000 | $ 6,467,000 | $ 6,185,000 | $ 27,116,000 | $ 24,980,000 | $ 25,292,000 |
Less: net income allocated to participating securities | (339,000) | (432,000) | (628,000) | ||||||||
Net income allocated to common stock | $ 26,777,000 | $ 24,548,000 | $ 24,664,000 | ||||||||
Weighted average common shares outstanding | 12,253,402 | 12,418,510 | 12,528,195 | ||||||||
Less: Unvested restricted stock awards considered participating securities | (153,482) | (217,045) | (312,175) | ||||||||
Adjusted weighted average common shares used in computing basic EPS | 12,099,920 | 12,201,465 | 12,216,020 | ||||||||
Basic earnings per share | $ 0.69 | $ 0.61 | $ 0.5 | $ 0.42 | $ 0.52 | $ 0.48 | $ 0.52 | $ 0.5 | $ 2.21 | $ 2.01 | $ 2.02 |
Earnings Per Common Share (EP_2
Earnings Per Common Share (EPS Diluted) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Earnings Per Share, Diluted [Abstract] | |||||||||||
Net income allocated to common stock | $ 26,777,000 | $ 24,548,000 | $ 24,664,000 | ||||||||
Adjusted weighted average common shares used in computing basic EPS | 12,099,920 | 12,201,465 | 12,216,020 | ||||||||
Add: Effect of dilutive stock options | 97,877 | 71,941 | 33,603 | ||||||||
Adjusted weighted average common shares used in computing diluted EPS | 12,197,797 | 12,273,406 | 12,249,623 | ||||||||
Diluted earnings per share | $ 0.69 | $ 0.6 | $ 0.49 | $ 0.41 | $ 0.51 | $ 0.47 | $ 0.52 | $ 0.5 | $ 2.2 | $ 2 | $ 2.01 |
Antidilutive securities excluded from computation of earnings per share amount | 159,077 | 145,847 | 101,157 |
Stockholders' Equity (Narrative
Stockholders' Equity (Narratives) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Aug. 01, 2019 | May 30, 2017 | Jul. 29, 2014 | |
Stock Repurchase [Line Items] | ||||||
Stock Repurchase Program, Authorized Amount | $ 10,000 | $ 15,000 | ||||
2014 Repurchase Plan [Member] | ||||||
Stock Repurchase [Line Items] | ||||||
Stock Repurchased During Period, Shares | 58,914 | |||||
Stock Repurchased During Period, Average Cost Per Share | $ 25.09 | |||||
Company's 2014 Equity Compensation Plan [Member] | ||||||
Stock Repurchase [Line Items] | ||||||
Stock Repurchased During Period, Shares | 22,741 | 28,605 | 38,139 | |||
Stock Repurchased During Period, Average Cost Per Share | $ 22.85 | $ 26.5 | $ 24.27 | |||
2017 Repurchase Plan [Member] | ||||||
Stock Repurchase [Line Items] | ||||||
Stock Repurchased During Period, Shares | 247,500 | 83,305 | 87,210 | |||
Stock Repurchased During Period, Average Cost Per Share | $ 23.24 | $ 25.83 | $ 24.05 | |||
2019 Repurchase Plan [Member] | ||||||
Stock Repurchase [Line Items] | ||||||
Stock Repurchase Program, Authorized Amount | $ 10,000 | |||||
Stock Repurchase Program, Remaining Authorized Repurchase Amount | $ 8,900 | |||||
Stock Repurchased During Period, Shares | 47,186 | |||||
Stock Repurchased During Period, Average Cost Per Share | $ 22.3 | |||||
Marlin Business Services Corp. [Member] | ||||||
Regulatory Capital Requirements Miscellaneous Information [Line Items] | ||||||
Total stockholders equity (regulatory) | $ 200,702 | $ 183,283 | ||||
Total Risk Based Capital Required for Capital Adequacy to Risk Weighted Assets | 8.00% | 8.00% | ||||
Tier One Leverage Capital Required for Capital Adequacy to Average Assets | 4.00% | 4.00% | ||||
Common Equity Tier One Risk Based Capital Required For Capital Adequacy To Risk Weighted Assets | 4.50% | 4.50% | ||||
Common Equity Tier One Risk Base Capital Required To Be Well Capitalized To Risk Weighted Assets | 6.50% | 6.50% | ||||
New Capital Conservation Buffer | 2.50% | 1.875% | 1.25% | |||
Tier One Risk Based Capital Required for Capital Adequacy to Risk Weighted Assets | 6.00% | 6.00% | ||||
Total Risk Based Capital to Risk Weighted Assets | 19.99% | 18.76% | ||||
MBB [Member] | ||||||
Regulatory Capital Requirements Miscellaneous Information [Line Items] | ||||||
Total stockholders equity (regulatory) | $ 147,810 | $ 138,994 | ||||
Total Risk Based Capital Required for Capital Adequacy to Risk Weighted Assets | 15.00% | 15.00% | ||||
Tier One Leverage Capital Required for Capital Adequacy to Average Assets | 5.00% | 5.00% | ||||
Common Equity Tier One Risk Based Capital Required For Capital Adequacy To Risk Weighted Assets | 6.50% | 6.50% | ||||
Common Equity Tier One Risk Base Capital Required To Be Well Capitalized To Risk Weighted Assets | 6.50% | 6.50% | ||||
Tier One Risk Based Capital Required for Capital Adequacy to Risk Weighted Assets | 8.00% | 8.00% | ||||
Total Risk Based Capital to Risk Weighted Assets | 16.73% | 17.24% |
Stockholders' Equity (Regulator
Stockholders' Equity (Regulatory Capital Ratios) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Marlin Business Services Corp. [Member] | ||
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | ||
Tier One Leverage Capital | $ 200,702 | $ 183,283 |
Tier One Leverage Capital Required for Capital Adequacy | 49,225 | 44,756 |
Tier One Leverage Capital Required to be Well Capitalized | 61,532 | 55,945 |
Common Equity Tier One Risk Based Capital | 200,702 | 183,283 |
Common Equity Tier One Risk Based Capital Required For Capital Adequacy | 48,228 | 47,118 |
Common Equity Tier One Risk Based Capital Required To Be Well Capitalized | 69,663 | 68,060 |
Tier One Risk Based Capital | 200,702 | 183,283 |
Tier One Risk Based Capital Required for Capital Adequacy | 64,305 | 62,825 |
Tier One Risk Based Capital Required to be Well Capitalized | 85,739 | 83,766 |
Total Risk Based Capital | 214,201 | 196,409 |
Total Risk Based Capital Required for Capital Adequacy | 85,739 | 83,766 |
Total Risk Based Capital Required to be Well Capitalized | $ 107,174 | $ 104,708 |
Tier One Leverage Capital to Average Assets | 16.31% | 16.38% |
Tier One Leverage Capital Required for Capital Adequacy to Average Assets | 4.00% | 4.00% |
Tier One Leverage Capital Required to be Well Capitalized to Average Assets | 5.00% | 5.00% |
Common Equity Tier One Risk Based Capital To Risk Weighted Assets | 18.73% | 17.50% |
Common Equity Tier One Risk Based Capital Required For Capital Adequacy To Risk Weighted Assets | 4.50% | 4.50% |
Common Equity Tier One Risk Base Capital Required To Be Well Capitalized To Risk Weighted Assets | 6.50% | 6.50% |
Tier One Risk Based Capital to Risk Weighted Assets | 18.73% | 17.50% |
Tier One Risk Based Capital Required for Capital Adequacy to Risk Weighted Assets | 6.00% | 6.00% |
Tier One Risk Based Capital Required to be Well Capitalized to Risk Weighted Assets | 8.00% | 8.00% |
Total Risk Based Capital to Risk Weighted Assets | 19.99% | 18.76% |
Total Risk Based Capital Required for Capital Adequacy to Risk Weighted Assets | 8.00% | 8.00% |
Total Risk Based Capital Required to be Well Capitalized to Risk Weighted Assets | 10.00% | 10.00% |
MBB [Member] | ||
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | ||
Tier One Leverage Capital | $ 147,810 | $ 138,994 |
Tier One Leverage Capital Required for Capital Adequacy | 53,124 | 44,706 |
Tier One Leverage Capital Required to be Well Capitalized | 53,124 | 44,706 |
Common Equity Tier One Risk Based Capital | 147,810 | 138,994 |
Common Equity Tier One Risk Based Capital Required For Capital Adequacy | 66,870 | 60,862 |
Common Equity Tier One Risk Based Capital Required To Be Well Capitalized | 66,870 | 60,862 |
Tier One Risk Based Capital | 147,810 | 138,994 |
Tier One Risk Based Capital Required for Capital Adequacy | 81,199 | 73,903 |
Tier One Risk Based Capital Required to be Well Capitalized | 81,199 | 73,903 |
Total Risk Based Capital | 159,845 | 149,909 |
Total Risk Based Capital Required for Capital Adequacy | 143,292 | 130,418 |
Total Risk Based Capital Required to be Well Capitalized | $ 100,305 | $ 91,292 |
Tier One Leverage Capital to Average Assets | 13.91% | 15.55% |
Tier One Leverage Capital Required for Capital Adequacy to Average Assets | 5.00% | 5.00% |
Tier One Leverage Capital Required to be Well Capitalized to Average Assets | 5.00% | 5.00% |
Common Equity Tier One Risk Based Capital To Risk Weighted Assets | 15.47% | 15.99% |
Common Equity Tier One Risk Based Capital Required For Capital Adequacy To Risk Weighted Assets | 6.50% | 6.50% |
Common Equity Tier One Risk Base Capital Required To Be Well Capitalized To Risk Weighted Assets | 6.50% | 6.50% |
Tier One Risk Based Capital to Risk Weighted Assets | 15.47% | 15.99% |
Tier One Risk Based Capital Required for Capital Adequacy to Risk Weighted Assets | 8.00% | 8.00% |
Tier One Risk Based Capital Required to be Well Capitalized to Risk Weighted Assets | 8.00% | 8.00% |
Total Risk Based Capital to Risk Weighted Assets | 16.73% | 17.24% |
Total Risk Based Capital Required for Capital Adequacy to Risk Weighted Assets | 15.00% | 15.00% |
Total Risk Based Capital Required to be Well Capitalized to Risk Weighted Assets | 10.00% | 10.00% |
Stock-Based Compensation (Narra
Stock-Based Compensation (Narratives) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||
Mar. 31, 2019 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Stock-based Compensation Arrangements [Line Items] | |||||||
Number of Shares, Stock Options Granted | 0 | 68,689 | 115,883 | ||||
Stock-based Compensation Expense | $ 3,079 | $ 3,394 | $ 2,738 | ||||
Stock Options Exercised, Number of Shares | 0 | 909 | 39,416 | ||||
Shares Outstanding | 143,935 | 186,603 | 277,617 | 396,518 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value | $ 23.19 | $ 29.84 | $ 25.36 | ||||
2019 Plan [Member] | |||||||
Stock-based Compensation Arrangements [Line Items] | |||||||
Equity Compensation Plan, Aggregate Number of Shares Authorized | 826,036 | ||||||
Equity Compensation Plan, Number of Shares Available for Grant | 820,990 | ||||||
Stock-based Compensation Expense | $ 3,100 | $ 3,400 | $ 2,800 | ||||
Excess tax benefits from stock-based payment arrangements | $ 100 | $ 300 | $ 400 | ||||
Stock Options [Member] | |||||||
Stock-based Compensation Arrangements [Line Items] | |||||||
Number of Shares, Stock Options Granted | 0 | 68,689 | 115,883 | ||||
Stock-based Compensation Expense | $ 300 | $ 300 | $ 200 | ||||
Stock Options Exercised, Number of Shares | 0 | 909 | 39,416 | ||||
Stock Options Exercised, Total Intrinsic Value | $ 100 | $ 400 | |||||
Total Compensation Cost Not yet Recognized on Nonvested Stock-based Awards | $ 200 | ||||||
Compensation Cost Not yet Recognized on Nonvested Stock-based Awards, Period for Recognition in Years | 10 months 24 days | ||||||
Stock-based Awards, Vesting Period in Years | 7 years | ||||||
Share-based Awards, Grants in Period, Weighted Average Grant Date Fair Value Per Share | $ 7.21 | $ 6.56 | |||||
Common Stock Closing Price Per Share | $ 21.98 | ||||||
Stock Options [Member] | Director [Member] | |||||||
Stock-based Compensation Arrangements [Line Items] | |||||||
Stock-based Awards, Vesting Period in Years | 1 year | ||||||
Stock Options [Member] | Minimum [Member] | |||||||
Stock-based Compensation Arrangements [Line Items] | |||||||
Stock-based Awards, Vesting Period in Years | 3 years | ||||||
Stock Options [Member] | Maximum [Member] | |||||||
Stock-based Compensation Arrangements [Line Items] | |||||||
Stock-based Awards, Vesting Period in Years | 4 years | ||||||
Restricted Stock Award [Member] | |||||||
Stock-based Compensation Arrangements [Line Items] | |||||||
Stock-based Compensation Expense | $ 900 | $ 1,300 | $ 1,700 | ||||
Total Compensation Cost Not yet Recognized on Nonvested Stock-based Awards | $ 1,400 | ||||||
Compensation Cost Not yet Recognized on Nonvested Stock-based Awards, Period for Recognition in Years | 4 years 4 months 24 days | ||||||
Shares Outstanding | 0 | ||||||
Stock-based Awards, Accelerated Vesting Period in Years | 3 years | ||||||
Stock-based Awards Other Than Options, Subject to Performance Acceleration, Grants in Period | 0 | ||||||
Stock-based Awards Other Than Options, Contingent on Performance, Grants in Period | 0 | ||||||
Stock-based Awards, Grants in Period, Aggregate Grant Date Fair Value | $ 400 | 500 | 1,100 | ||||
Stock-based Compensation Expense Due to Performance Acceleration | $ 100 | $ 200 | |||||
Stock-based Awards Other than Options, Vested in Period, Total Fair Value | $ 1,300 | 2,500 | 3,000 | ||||
Restricted Stock Award [Member] | Minimum [Member] | |||||||
Stock-based Compensation Arrangements [Line Items] | |||||||
Stock-based Awards, Vesting Period in Years | 3 years | ||||||
Restricted Stock Award [Member] | Minimum [Member] | Director [Member] | |||||||
Stock-based Compensation Arrangements [Line Items] | |||||||
Stock-based Awards, Vesting Period in Years | 6 months | ||||||
Restricted Stock Award [Member] | Maximum [Member] | |||||||
Stock-based Compensation Arrangements [Line Items] | |||||||
Stock-based Awards, Vesting Period in Years | 7 years | ||||||
Restricted Stock Award [Member] | Maximum [Member] | Director [Member] | |||||||
Stock-based Compensation Arrangements [Line Items] | |||||||
Stock-based Awards, Vesting Period in Years | 7 years | ||||||
Performance-Based and Market-Based RSUs [Member] | |||||||
Stock-based Compensation Arrangements [Line Items] | |||||||
Stock-based Compensation Expense | $ 1,800 | $ 1,700 | $ 900 | ||||
Total Compensation Cost Not yet Recognized on Nonvested Stock-based Awards | $ 2,700 | ||||||
Compensation Cost Not yet Recognized on Nonvested Stock-based Awards, Period for Recognition in Years | 1 year 6 months | ||||||
Shares Outstanding | 257,476 | 191,921 | 158,553 | 120,000 | |||
Total Compensation Cost Not yet Recognized on Nonvested Stock-based Awards, Incremental Cost at Maximum Performance | $ 2,900 | ||||||
Total Compensation Cost Not yet Recognized on Nonvested Stock-based Awards, Period for Recognition of Incremental Cost at Maximum Performance in Years | 1 year 8 months 12 days | ||||||
Stock-based Awards, Vesting Period in Years | 4 years | ||||||
Stock-based Awards Other Than Options, Contingent on Performance, Grants in Period | 145,729 | ||||||
Share-based Awards, Grants in Period, Weighted Average Grant Date Fair Value Per Share | $ 12.91 | ||||||
Stock-based Awards, Grants in Period, Aggregate Grant Date Fair Value | $ 3,400 | $ 2,400 | $ 2,500 | ||||
Stock-based Awards Other Than Options, Additional Grants Contingently Issuable | 377,803 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value | $ 18.37 | $ 28.25 | $ 24.06 | ||||
Market based RSUs [Member] | |||||||
Stock-based Compensation Arrangements [Line Items] | |||||||
Stock-based Awards Other Than Options, Contingent on Performance, Grants in Period | 0 | 0 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value | $ 13.32 | ||||||
Market based RSUs [Member] | Minimum [Member] | |||||||
Stock-based Compensation Arrangements [Line Items] | |||||||
Stock-based Awards, Vesting Period in Years | 1 year | ||||||
Market based RSUs [Member] | Maximum [Member] | |||||||
Stock-based Compensation Arrangements [Line Items] | |||||||
Stock-based Awards, Vesting Period in Years | 3 years | ||||||
2017 performance based RSUs [Member] | |||||||
Stock-based Compensation Arrangements [Line Items] | |||||||
Stock-based Compensation Expense | $ 0 | ||||||
RSUs performance based [Member] | Minimum [Member] | |||||||
Stock-based Compensation Arrangements [Line Items] | |||||||
Stock-based Awards, Vesting Period in Years | 3 years | ||||||
RSUs performance based [Member] | Maximum [Member] | |||||||
Stock-based Compensation Arrangements [Line Items] | |||||||
Stock-based Awards, Vesting Period in Years | 4 years | ||||||
Employee Stock Purchase Plan 2012 [Member] | |||||||
Stock-based Compensation Arrangements [Line Items] | |||||||
Equity Compensation Plan, Aggregate Number of Shares Authorized | 140,000 | ||||||
Stock-based Compensation Expense | $ 100 | $ 100 | $ 100 | ||||
Employee Stock Purchase Plan, Maximum Employee Compensation Contribution Percentage | 10.00% | ||||||
Employee Stock Purchase Plan, Purchase Price Per Share as Percent of Fair Market Value | 95.00% | ||||||
Employee Stock Purchase Plan, Issuance of Common Stock, Shares | 18,458 | 18,076 | |||||
Employee Stock Purchase Plan, Issuance of Common Stock, Value | $ 400 | $ 400 | |||||
Employee Stock Purchase Plan, Number Of Shares Available For Issuance | 14,891 |
Stock-Based Compensation (Summa
Stock-Based Compensation (Summary of Option Activity) (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Stock-based Compensation Arrangements, Options, Outstanding [Roll Forward] | |||
Number of Shares Outstanding, Beginning of Period | 146,431 | 96,985 | 41,640 |
Number of Shares, Stock Options Granted | 0 | 68,689 | 115,883 |
Number of Shares, Stock Options Exercised | 0 | (909) | (39,416) |
Number of Shares, Stock Options Forfeited | (6,948) | (17,827) | (21,122) |
Number of Shares, Stock Options Expired | (4,324) | (507) | 0 |
Number of Shares Outstanding, End of Period | 135,159 | 146,431 | 96,985 |
Weighted Average Exercise Price Per Share, Outstanding at Beginning of Period | $ 26.77 | $ 25.75 | $ 12.37 |
Weighted Average Exercise Price Per Share, Options Granted | 0 | 28.25 | 25.75 |
Weighted Average Exercise Price Per Share, Options Exercised | 0 | 25.75 | 12.37 |
Weighted Average Exercise Price Per Share, Option Forfeitures | 27 | 26.97 | 24.35 |
Weighted Average Exercise Price Per Share, Options Expired | 25.75 | 25.75 | 0 |
Weighted Average Exercise Price Per Share, Outstanding at End of Period | $ 26.8 | $ 26.77 | $ 25.75 |
Stock-based Compensation Arrangement By Share Based Payment Award Fair Value Assumptions And Methodology [Abstract] | |||
Risk-free interest rate | 2.64% | 1.82% | |
Expected option life | 4 years 6 months | 4 years 6 months | |
Expected volatility | 32.32% | 34.62% | |
Dividend yield | 1.98% | 2.17% |
Stock-Based Compensation (Sum_2
Stock-Based Compensation (Summary of Stock Options Outstanding and Exercisable) (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Options Outstanding, Number of Shares | 135,159 | 146,431 | 96,985 | 41,640 |
Options Outstanding, Weighted Average Remaining Life (Years) | 4 years 7 months 6 days | |||
Options Outstanding, Weighted Average Exercise Price | $ 26.8 | $ 26.77 | $ 25.75 | $ 12.37 |
Options Outstanding, Aggregate Intrinsic Value | $ 0 | |||
Options Exercisable, Number of Shares | 74,017 | |||
Options Exercisable, Weighted Average Remaining Life (Years) | 4 years 6 months | |||
Options Exercisable, Weighted Average Exercise Price | $ 26.43 | |||
Options Exercisable, Aggregate Intrinsic Value | $ 0 | |||
$25.75 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Options Outstanding, Number of Shares | 78,606 | |||
Options Outstanding, Weighted Average Remaining Life (Years) | 4 years 2 months 12 days | |||
Options Outstanding, Weighted Average Exercise Price | $ 25.75 | |||
Options Outstanding, Aggregate Intrinsic Value | $ 0 | |||
Options Exercisable, Number of Shares | 54,016 | |||
Options Exercisable, Weighted Average Remaining Life (Years) | 4 years 2 months 12 days | |||
Options Exercisable, Weighted Average Exercise Price | $ 25.75 | |||
Options Exercisable, Aggregate Intrinsic Value | $ 0 | |||
$28.25 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Options Outstanding, Number of Shares | 56,553 | |||
Options Outstanding, Weighted Average Remaining Life (Years) | 5 years 2 months 12 days | |||
Options Outstanding, Weighted Average Exercise Price | $ 28.25 | |||
Options Outstanding, Aggregate Intrinsic Value | $ 0 | |||
Options Exercisable, Number of Shares | 20,001 | |||
Options Exercisable, Weighted Average Remaining Life (Years) | 5 years 2 months 12 days | |||
Options Exercisable, Weighted Average Exercise Price | $ 28.25 | |||
Options Exercisable, Aggregate Intrinsic Value | $ 0 |
Stock-Based Compensation (Sum_3
Stock-Based Compensation (Summary of Non-Vested Restricted Stock Activity) (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Stock-based Compensation Arrangements, Restricted Stock, Nonvested [Roll Forward] | |||
Shares Outstanding, Beginning of Period | 186,603 | 277,617 | 396,518 |
Shares, Granted | 18,924 | 18,206 | 44,758 |
Shares, Vested | (56,606) | (93,764) | (122,202) |
Shares, Forfeited | (4,986) | (15,456) | (41,457) |
Shares Outstanding, End of Period | 143,935 | 186,603 | 277,617 |
Weighted Average Grant-Date Fair Value, Outstanding at Beginning of Period | $ 19.91 | $ 17.51 | $ 16.07 |
Weighted Average Grant-Date Fair Value, Granted | 23.19 | 29.84 | 25.36 |
Weighted Average Grant-Date Fair Value, Forfeited | 20.36 | 17.46 | 16.07 |
Weighted Average Grant-Date Fair Value, Vested | 15.95 | 15.13 | 16.19 |
Weighted Average Grant-Date Fair Value, Outstanding at End of Period | $ 21.88 | $ 19.91 | $ 17.51 |
Stock-based Compensation Arrangement By Share Based Payment Award Fair Value Assumptions And Methodology [Abstract] | |||
Risk-free interest rate | 2.64% | 1.82% | |
Expected volatility | 32.32% | 34.62% | |
Dividend yield | 1.98% | 2.17% | |
Performance-Based and Market-Based RSUs [Member] | |||
Stock-based Compensation Arrangements, Restricted Stock, Nonvested [Roll Forward] | |||
Shares Outstanding, Beginning of Period | 191,921 | 158,553 | 120,000 |
Shares, Granted | 95,408 | 35,056 | 72,180 |
Shares, Forfeited | (17,853) | (1,688) | (33,627) |
Shares, Converted | (8,000) | 0 | 0 |
Cancelled due to non-achievement | (4,000) | ||
Shares Outstanding, End of Period | 257,476 | 191,921 | 158,553 |
Weighted Average Grant-Date Fair Value, Outstanding at Beginning of Period | $ 17.43 | $ 15.13 | $ 9.47 |
Weighted Average Grant-Date Fair Value, Granted | 18.37 | 28.25 | 24.06 |
Weighted Average Grant-Date Fair Value, Forfeited | 19.57 | 25.75 | 14.13 |
Weighted Average Grant-Date Fair Value, Converted | 9.47 | 0 | 0 |
Weighted Average Grant-Date Fair Value, Cancelled | 9.47 | ||
Weighted Average Grant-Date Fair Value, Outstanding at End of Period | 18 | 17.43 | 15.13 |
Stock-based Compensation Arrangement By Share Based Payment Award Fair Value Assumptions And Methodology [Abstract] | |||
Grant date stock price | $ 21.5 | $ 0 | $ 25.75 |
Risk-free interest rate | 2.16% | 0.00% | 1.72% |
Expected volatility | 26.68% | 0.00% | 33.42% |
Dividend yield | 0.00% | 0.00% | 0.00% |
Service-Based RSUs [Member] | |||
Stock-based Compensation Arrangements, Restricted Stock, Nonvested [Roll Forward] | |||
Shares Outstanding, Beginning of Period | 61,256 | 25,840 | 0 |
Shares, Granted | 74,620 | 49,463 | 30,653 |
Shares, Forfeited | (13,033) | (5,606) | (4,813) |
Shares, Converted | 22,892 | 8,441 | 0 |
Shares Outstanding, End of Period | 99,951 | 61,256 | 25,840 |
Weighted Average Grant-Date Fair Value, Outstanding at Beginning of Period | $ 27.61 | $ 25.63 | $ 0 |
Weighted Average Grant-Date Fair Value, Granted | 21.5 | 28.26 | 25.65 |
Weighted Average Grant-Date Fair Value, Forfeited | 23.84 | 27.21 | 25.75 |
Weighted Average Grant-Date Fair Value, Converted | 27.39 | 25.63 | 0 |
Weighted Average Grant-Date Fair Value, Outstanding at End of Period | $ 23.59 | $ 27.61 | $ 25.63 |
Employee 401(k) Plan (Narrative
Employee 401(k) Plan (Narratives) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Employee 401(k) Plan [Abstract] | |||
Description of 401(k) Plan | The Company adopted a 401(k) plan (the “401(k) Plan”) which originally became effective as of January 1, 1997. The Company’s employees are entitled to participate in the 401(k) Plan, which provides savings and investment opportunities. Employees can contribute up to the maximum annual amount allowable per Internal Revenue Service guidelines. Effective July 1, 2007, the 401(k) Plan provides for Company contributions equal to 25% of an employee’s contribution percentage up to a maximum employee contribution of 6%. | ||
Company Contributions to Employee 401(k) Plan | $ 0.4 | $ 0.3 | $ 0.3 |
Maximum Employee Contribution for Company Matching | 25.00% | ||
Employer Contribution per Dollar of Employee Contribution | 6.00% |
Parent Company (Balance Sheet)
Parent Company (Balance Sheet) (Details) - USD ($) | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Condensed Financial Statements, Captions [Line Items] | ||||||||||
Total assets | $ 1,207,443,000 | $ 1,247,416,000 | $ 1,279,983,000 | $ 1,246,725,000 | $ 1,167,046,000 | $ 1,126,733,000 | $ 1,113,311,000 | $ 1,071,225,000 | ||
Total liabilities | 992,487,000 | 968,535,000 | ||||||||
Preferred Stock, $0.01 par value; 5,000,000 shares authorized; none issued | 0 | 0 | ||||||||
Common Stock | 121,000 | 124,000 | ||||||||
Additional paid-in capital | 79,665,000 | 83,496,000 | ||||||||
Accumulated other comprehensive income (loss) | 58,000 | (44,000) | ||||||||
Retained earnings | 135,112,000 | 114,935,000 | ||||||||
Total stockholders' equity | 214,956,000 | 198,511,000 | $ 179,649,000 | $ 162,289,000 | ||||||
Total liabilities and stockholders' equity | 1,207,443,000 | 1,167,046,000 | ||||||||
Marlin Business Services Corp. [Member] | ||||||||||
Condensed Financial Statements, Captions [Line Items] | ||||||||||
Investments in bank subsidiary | 150,745,000 | 141,827,000 | ||||||||
Investments in non bank subsidiaries | 64,211,000 | 56,684,000 | ||||||||
Total assets | 214,956,000 | 198,511,000 | ||||||||
Total liabilities | 0 | 0 | ||||||||
Preferred Stock, $0.01 par value; 5,000,000 shares authorized; none issued | 0 | 0 | ||||||||
Common Stock | 121,000 | 124,000 | ||||||||
Additional paid-in capital | 79,665,000 | 83,496,000 | ||||||||
Stock subscription receivable | 0 | 0 | ||||||||
Accumulated other comprehensive income (loss) | 58,000 | (44,000) | ||||||||
Retained earnings | 135,112,000 | 114,935,000 | ||||||||
Total stockholders' equity | 214,956,000 | 198,511,000 | ||||||||
Total liabilities and stockholders' equity | $ 214,956,000 | $ 198,511,000 |
Parent Company (Income Statemen
Parent Company (Income Statement) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Operating Expenses [Abstract[ | |||||||||||
Income tax expense | $ 2,880 | $ 3,281 | $ 1,974 | $ 1,602 | $ 2,259 | $ 1,723 | $ 2,057 | $ 1,682 | $ 9,737 | $ 7,721 | $ (1,656) |
Comprehensive Income | |||||||||||
Reclassification due to adoption of ASU 2016-01, ASU 2018-02 and ASU 2018-03 | 0 | 107 | 0 | ||||||||
Increase (decrease) in fair value of securities available for sale | 138 | (7) | 68 | ||||||||
Tax effect | (36) | (48) | (26) | ||||||||
Total other comprehensive income | 102 | 52 | 42 | ||||||||
Comprehensive Income | 27,218 | 25,032 | 25,334 | ||||||||
Marlin Business Services Corp. [Member] | |||||||||||
Operating Revenues [Abstract] | |||||||||||
Total revenue | 20,262 | 29,931 | 17,556 | ||||||||
Operating Expenses [Abstract[ | |||||||||||
Total expense | 0 | 0 | 0 | ||||||||
Income before income taxes and equity in undistributed net income of subsidiaries | 20,262 | 29,931 | 17,556 | ||||||||
Income tax expense | 0 | 0 | 0 | ||||||||
Net income of parent | 27,116 | 24,980 | 25,292 | ||||||||
Comprehensive Income | |||||||||||
Reclassification due to adoption of ASU 2016-01, ASU 2018-02 and ASU 2018-03 | 0 | 107 | 0 | ||||||||
Increase (decrease) in fair value of securities available for sale | 138 | (7) | 68 | ||||||||
Tax effect | (36) | (48) | (26) | ||||||||
Total other comprehensive income | 102 | 52 | 42 | ||||||||
Comprehensive Income | 27,218 | 25,032 | 25,334 | ||||||||
Marlin Business Services Corp. [Member] | Bank Subsidiary [Member] | |||||||||||
Operating Revenues [Abstract] | |||||||||||
Dividend Income Operating | 6,000 | 20,000 | 6,000 | ||||||||
Operating Expenses [Abstract[ | |||||||||||
Equity in undistributed net (income) losses of subsidiaries | 8,816 | (3,417) | 14,571 | ||||||||
Marlin Business Services Corp. [Member] | Non Bank Subsidiaries [Member] | |||||||||||
Operating Revenues [Abstract] | |||||||||||
Dividend Income Operating | 14,262 | 9,931 | 11,556 | ||||||||
Operating Expenses [Abstract[ | |||||||||||
Equity in undistributed net (income) losses of subsidiaries | $ (1,962) | $ (1,534) | $ (6,835) |
Parent Company (Statement of Ca
Parent Company (Statement of Cash Flows) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Net cash provided by (used in) operating activities | $ 62,420 | $ 84,381 | $ 52,871 |
Cash flows from investing activities: | |||
Net cash provided by (used in) investing activities | (38,041) | (126,932) | (148,825) |
Cash flows from financing activities: | |||
Issuances of common stock | 410 | 401 | 356 |
Repurchases of common stock | (7,323) | (2,908) | (4,501) |
Dividends paid | (6,865) | (6,936) | (6,958) |
Proceeds from Stock Options Exercised | 0 | 23 | 488 |
Net cash provided by (used in) financing activities | (5,553) | 86,606 | 101,343 |
Marlin Business Services Corp. [Member] | |||
Cash flows from operating activities: | |||
Net income of parent | 27,116 | 24,980 | 25,292 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Equity in undistributed net (income) losses of subsidiaries | (21,116) | (4,980) | (19,292) |
Net cash provided by (used in) operating activities | 6,000 | 20,000 | 6,000 |
Cash flows from investing activities: | |||
Capital returned from nonbank subsidiaries | 14,262 | 9,931 | 11,556 |
Capital contributed to subsidiaries | (6,484) | (20,492) | (6,941) |
Net cash provided by (used in) investing activities | 7,778 | (10,561) | 4,615 |
Cash flows from financing activities: | |||
Issuances of common stock | 410 | 402 | 356 |
Repurchases of common stock | (7,323) | (2,908) | (4,501) |
Dividends paid | (6,865) | (6,956) | (6,958) |
Proceeds from Stock Options Exercised | 0 | 23 | 488 |
Net cash provided by (used in) financing activities | $ (13,778) | $ (9,439) | $ (10,615) |
Subsequent Events (Narratives)
Subsequent Events (Narratives) (Details) $ / shares in Units, $ in Thousands | Jan. 30, 2020USD ($)Number$ / shares | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) |
Subsequent Event [Line Items] | ||||
Cash dividends declared | $ 6,939 | $ 7,023 | $ 7,055 | |
Subsequent Event [Member] | ||||
Subsequent Event [Line Items] | ||||
Cash dividends declared per share | $ / shares | $ 0.14 | |||
Cash dividends declared | $ 1,700 | |||
Cash dividend declared on common stock, date declared | Jan. 30, 2020 | |||
Cash dividend declared on common stock, payable date | Feb. 20, 2020 | |||
Cash dividend declared on common stock, date of record | Feb. 10, 2020 | |||
Number of consecutive cash dividends declared on common stock | Number | 34 |
Selected Quaterly Finacial Data
Selected Quaterly Finacial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Quarterly Financial Data [Abstract] | ||||||||||||
Interest Income From Loans And Leases | $ 26,747 | $ 27,708 | $ 27,082 | $ 25,883 | $ 24,946 | $ 24,836 | $ 23,964 | $ 23,279 | $ 107,420 | $ 97,025 | $ 87,455 | |
Fee Income From Loans And Leases | 3,787 | 3,869 | 3,507 | 4,042 | 4,078 | 3,930 | 3,876 | 3,959 | 15,205 | 15,843 | 14,864 | |
Interest and fee income | 30,534 | 31,577 | 30,589 | 29,925 | 29,024 | 28,766 | 27,840 | 27,238 | 122,625 | 112,868 | 102,319 | |
Interest expense | 6,102 | 6,561 | 6,408 | 5,962 | 5,349 | 4,955 | 3,711 | 3,399 | 25,033 | 17,414 | 11,180 | |
Provision for credit losses | 10,255 | 7,662 | 4,756 | 5,363 | 5,761 | 4,893 | 4,256 | 4,612 | 28,036 | 19,522 | 18,394 | |
Noninterest Income | 13,520 | 10,362 | 7,201 | 12,948 | 7,125 | 4,448 | 4,627 | 5,234 | 44,031 | 21,434 | 16,732 | |
Income tax expense | 2,880 | 3,281 | 1,974 | 1,602 | 2,259 | 1,723 | 2,057 | 1,682 | 9,737 | 7,721 | (1,656) | |
Net income | $ 8,414 | $ 7,446 | $ 6,115 | $ 5,141 | $ 6,422 | $ 5,906 | $ 6,467 | $ 6,185 | $ 27,116 | $ 24,980 | $ 25,292 | |
Basic earnings per share | $ 0.69 | $ 0.61 | $ 0.5 | $ 0.42 | $ 0.52 | $ 0.48 | $ 0.52 | $ 0.5 | $ 2.21 | $ 2.01 | $ 2.02 | |
Diluted earnings per share | 0.69 | 0.6 | 0.49 | 0.41 | 0.51 | 0.47 | 0.52 | 0.5 | 2.2 | 2 | 2.01 | |
Cash dividends declared and paid per share | $ 0.14 | $ 0.14 | $ 0.14 | $ 0.14 | $ 0.14 | $ 0.14 | $ 0.14 | $ 0.14 | $ 0.14 | $ 0.56 | $ 0.56 | $ 0.56 |
Net investment in leases and loans | $ 1,006,520 | $ 1,034,498 | $ 1,062,271 | $ 1,023,190 | $ 1,000,740 | $ 970,425 | $ 963,109 | $ 930,627 | $ 1,006,520 | $ 1,000,740 | ||
Total assets | $ 1,207,443 | $ 1,247,416 | $ 1,279,983 | $ 1,246,725 | $ 1,167,046 | $ 1,126,733 | $ 1,113,311 | $ 1,071,225 | $ 1,207,443 | $ 1,167,046 |