Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | May 01, 2020 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2020 | |
Entity Registrant Name | Bridgewater Bancshares Inc | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Interactive Data Current | Yes | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 28,813,082 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Entity Central Index Key | 0001341317 | |
Amendment Flag | false | |
Entity Ex Transition Period | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
ASSETS | ||
Cash and Cash Equivalents | $ 61,526 | $ 31,935 |
Bank-Owned Certificates of Deposit | 2,895 | 2,654 |
Securities Available for Sale, at Fair Value | 307,317 | 289,877 |
Loans, Net of Allowance for Loan Losses of $24,585 at March 31, 2020 (unaudited) and $22,526 at December 31, 2019 | 1,972,896 | 1,884,000 |
Federal Home Loan Bank (FHLB) Stock, at Cost | 11,017 | 7,824 |
Premises and Equipment, Net | 35,271 | 27,628 |
Accrued Interest | 7,102 | 6,775 |
Goodwill | 2,626 | 2,626 |
Other Intangible Assets, Net | 813 | 861 |
Other Assets | 17,267 | 14,650 |
Total Assets | 2,418,730 | 2,268,830 |
Deposits: | ||
Noninterest Bearing | 476,217 | 447,509 |
Interest Bearing | 1,423,910 | 1,375,801 |
Total Deposits | 1,900,127 | 1,823,310 |
Notes Payable | 12,500 | 13,000 |
FHLB Advances | 207,500 | 136,500 |
Subordinated Debentures, Net of Issuance Costs | 24,759 | 24,733 |
Accrued Interest Payable | 1,688 | 1,982 |
Other Liabilities | 24,013 | 24,511 |
Total Liabilities | 2,170,587 | 2,024,036 |
SHAREHOLDERS' EQUITY | ||
Preferred Stock- $0.01 par value Authorized 10,000,000; None Issued and Outstanding at March 31, 2020 (unaudited) and December 31, 2019 | ||
Common Stock- $0.01 par value Common Stock - Authorized 75,000,000; Issued and Outstanding 28,807,375 at March 31, 2020 (unaudited) and 28,973,572 at December 31, 2019 | 288 | 290 |
Additional Paid-In Capital | 110,446 | 112,093 |
Retained Earnings | 135,080 | 127,637 |
Accumulated Other Comprehensive Income | 2,329 | 4,774 |
Total Shareholders' Equity | 248,143 | 244,794 |
Total Liabilities and Shareholders' Equity | $ 2,418,730 | $ 2,268,830 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Consolidated Balance Sheets | ||
Allowance of loan loss | $ 24,585 | $ 22,526 |
Preferred shares, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common shares, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 75,000,000 | 75,000,000 |
Common stock, shares issued (in shares) | 28,807,375 | 28,973,572 |
Common stock, shares outstanding (in shares) | 28,807,375 | 28,973,572 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
INTEREST INCOME | ||
Loans, Including Fees | $ 25,113 | $ 22,179 |
Investment Securities | 2,196 | 1,901 |
Other | 159 | 187 |
Total Interest Income | 27,468 | 24,267 |
INTEREST EXPENSE | ||
Deposits | 5,724 | 5,703 |
Notes Payable | 115 | 121 |
FHLB Advances | 1,027 | 775 |
Subordinated Debentures | 393 | 377 |
Federal Funds Purchased | 107 | 160 |
Total Interest Expense | 7,366 | 7,136 |
NET INTEREST INCOME | 20,102 | 17,131 |
Provision for Loan Losses | 2,100 | 600 |
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES | 18,002 | 16,531 |
NONINTEREST INCOME | ||
Customer Service Fees | 240 | 191 |
Net Gain (Loss) on Sales of Available for Sale Securities | 3 | (5) |
Other Income | 1,476 | 448 |
Total Noninterest Income | 1,719 | 634 |
NONINTEREST EXPENSE | ||
Salaries and Employee Benefits | 6,454 | 4,802 |
Occupancy and Equipment | 713 | 656 |
Other Expense | 2,579 | 2,427 |
Total Noninterest Expense | 9,746 | 7,885 |
INCOME BEFORE INCOME TAXES | 9,975 | 9,280 |
Provision for Income Taxes | 2,532 | 2,262 |
NET INCOME | $ 7,443 | $ 7,018 |
EARNINGS PER SHARE | ||
Basic (in dollars per share) | $ 0.26 | $ 0.23 |
Diluted (in dollars per share) | $ 0.25 | $ 0.23 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Consolidated Statements of Comprehensive Income | ||
Net Income | $ 7,443 | $ 7,018 |
Other Comprehensive Income (Loss): | ||
Unrealized Gains (Losses) on Available for Sale Securities | (178) | 4,618 |
Unrealized Gains (Losses) on Cash Flow Hedges | (2,932) | (91) |
Reclassification Adjustment for (Gains) Losses Realized in Income | 15 | 5 |
Income Tax Impact | 650 | (951) |
Total Other Comprehensive Income (Loss), Net of Tax | (2,445) | 3,581 |
Comprehensive Income | $ 4,998 | $ 10,599 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity - USD ($) $ in Thousands | Common StockVoting Common Stock | Additional Paid In Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total |
Balance at the beginning at Dec. 31, 2018 | $ 301 | $ 126,031 | $ 96,234 | $ (1,568) | $ 220,998 |
Balance at the beginning (in shares) at Dec. 31, 2018 | 30,097,274 | ||||
Stock-based Compensation | 175 | 175 | |||
Comprehensive Income (Loss) | 7,018 | 3,581 | 10,599 | ||
Stock Options Exercised | 3 | 3 | |||
Stock Options Exercised (in shares) | 400 | ||||
Balance at the end at Mar. 31, 2019 | $ 301 | 126,209 | 103,252 | 2,013 | 231,775 |
Balance at the end (in shares) at Mar. 31, 2019 | 30,097,674 | ||||
Balance at the beginning at Dec. 31, 2019 | $ 290 | 112,093 | 127,637 | 4,774 | 244,794 |
Balance at the beginning (in shares) at Dec. 31, 2019 | 28,973,572 | ||||
Stock-based Compensation | 401 | 401 | |||
Stock-based Compensation (in shares) | 7,721 | ||||
Comprehensive Income (Loss) | 7,443 | (2,445) | 4,998 | ||
Stock Repurchases | $ (2) | (2,048) | (2,050) | ||
Stock Repurchases (in shares) | (177,864) | ||||
Issuance of Restricted Stock Awards (in shares) | 3,946 | ||||
Balance at the end at Mar. 31, 2020 | $ 288 | $ 110,446 | $ 135,080 | $ 2,329 | $ 248,143 |
Balance at the end (in shares) at Mar. 31, 2020 | 28,807,375 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES | |||
Net Income | $ 7,443 | $ 7,018 | |
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities | |||
Net Amortization on Securities Available for Sale | 580 | 668 | |
Net (Gain) Loss on Sales of Securities Available for Sale | (3) | 5 | |
Provision for Loan Losses | 2,100 | 600 | |
Depreciation and Amortization of Premises and Equipment | 187 | 210 | |
Amortization of Other Intangible Assets | 48 | 48 | |
Amortization of Subordinated Debt Issuance Costs | 26 | 26 | |
Stock-based Compensation | 401 | 175 | |
Changes in Operating Assets and Liabilities: | |||
Accrued Interest Receivable and Other Assets | (5,207) | 1,574 | |
Accrued Interest Payable and Other Liabilities | (7,736) | (665) | |
Net Cash Provided by (Used for) Operating Activities | (2,161) | 9,659 | |
CASH FLOWS FROM INVESTING ACTIVITIES | |||
(Increase) Decrease in Bank-owned Certificates of Deposit | (241) | 357 | |
Proceeds from Sales of Securities Available for Sale | 2,102 | 8,150 | |
Proceeds from Maturities, Paydowns, Payups and Calls of Securities Available for Sale | 10,545 | 4,761 | |
Purchases of Securities Available for Sale | (23,902) | (5,867) | |
Net Increase in Loans | (91,130) | (58,446) | |
Net (Increase) Decrease in FHLB Stock | (3,193) | 290 | |
Purchases of Premises and Equipment | (7,830) | (2,833) | |
Proceeds from Sales of Foreclosed Assets | 134 | ||
Net Cash Used in Investing Activities | (113,515) | (53,588) | |
CASH FLOWS FROM FINANCING ACTIVITIES | |||
Increase in Deposits | 76,817 | 82,732 | |
Net Decrease in Federal Funds Purchased | (18,000) | ||
Principal Payments on Notes Payable | (500) | (500) | |
Proceeds from FHLB Advances | 76,000 | ||
Principal Payments on FHLB Advances | (5,000) | ||
Stock Options Exercised | 3 | ||
Stock Repurchases | (2,050) | ||
Net Cash Provided by Financing Activities | 145,267 | 64,235 | |
NET CHANGE IN CASH AND CASH EQUIVALENTS | 29,591 | 20,306 | |
Cash and Cash Equivalents Beginning | 31,935 | 28,444 | $ 28,444 |
Cash and Cash Equivalents Ending | 61,526 | 48,750 | $ 31,935 |
SUPPLEMENTAL CASH FLOW DISCLOSURE | |||
Cash Paid for Interest | 7,633 | $ 7,237 | |
Cash Paid for Income Taxes | 430 | ||
Loans Transferred to Foreclosed Assets | 134 | ||
Investment Securities Purchased but Not Settled | $ 6,944 |
Description of the Business and
Description of the Business and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2020 | |
Description of the Business and Summary of Significant Accounting Policies | |
Description of the Business and Summary of Significant Accounting Policies | Note 1: Description of the Business and Summary of Significant Accounting Policies Organization Bridgewater Bancshares, Inc. (the “Company”) is a financial holding company whose operations consist of the ownership of its wholly-owned subsidiaries, Bridgewater Bank (the “Bank”) and Bridgewater Risk Management, Inc. The Bank commenced operations in 2005 and provides retail and commercial loan and deposit services, principally to customers within the Minneapolis-St. Paul-Bloomington, MN-WI Metropolitan Statistical Area. In 2008, the Bank formed BWB Holdings, LLC, a wholly owned subsidiary of the Bank, for the purpose of holding repossessed property. In 2018, the Bank formed Bridgewater Investment Management, Inc., a wholly owned subsidiary of the Bank, for the purpose of holding certain municipal securities and to engage in municipal lending activities. Bridgewater Risk Management, a subsidiary of the Company, was incorporated in 2016 as a wholly owned insurance company. It insures the Company and its subsidiaries against certain risks unique to the operations of the Company and for which insurance may not be currently available or economically feasible in today’s insurance marketplace. Bridgewater Risk Management pools resources with several other insurance company subsidiaries of financial institutions to spread a limited amount of risk among themselves. Basis of Presentation The accompanying unaudited consolidated financial statements were prepared in accordance with instructions for Form 10‑Q and, therefore, do not include all disclosures necessary for a complete presentation of the consolidated balance sheets, consolidated statements of income, consolidated statements of comprehensive income, consolidated statements of shareholders’ equity and consolidated statements of cash flows in conformity with U.S. generally accepted accounting principles (“GAAP”). However, all normal recurring adjustments which are, in the opinion of management, necessary for the fair presentation of the interim financial statements have been included. The results of operations for the three-month period ended March 31, 2020 are not necessarily indicative of the results which may be expected for the entire year. For further information, refer to the consolidated financial statements and footnotes included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on March 12, 2020. Principles of Consolidation These consolidated financial statements include the amounts of the Company, the Bank, with locations in Bloomington, Greenwood, Minneapolis (2), St. Louis Park, Orono, and St. Paul, Minnesota, BWB Holdings, LLC, Bridgewater Investment Management, Inc., and Bridgewater Risk Management, Inc. All significant intercompany balances and transactions have been eliminated in consolidation. Use of Estimates in Preparation of Financial Statements The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Information available which could affect judgements includes, but is not limited to, changes in interest rates, changes in the performance of the economy, including COVID-19 pandemic related changes, and changes in the financial condition of borrowers. Material estimates that are particularly susceptible to significant change in the near term include the valuation of securities, determination of the allowance for loan losses, calculation of deferred tax assets, fair value of financial instruments, and investment securities impairment. Emerging Growth Company The Company qualifies as an “emerging growth company” under the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and may take advantage of certain exemptions from various reporting requirements that are applicable to public companies that are not emerging growth companies, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. In addition, even if the Company complies with the greater obligations of public companies that are not emerging growth companies, the Company may avail itself of the reduced requirements applicable to emerging growth companies from time to time in the future, so long as the Company is an emerging growth company. The Company will continue to be an emerging growth company until the earliest to occur of: (1) the end of the fiscal year following the fifth anniversary of the date of the first sale of common equity securities under the Company’s Registration Statement on Form S-1, which was declared effective by the SEC on March 13, 2018; (2) the last day of the fiscal year in which the Company has $1.07 billion or more in annual revenues; (3) the date on which the Company is deemed to be a “large accelerated filer” under the Securities Exchange Act of 1934, as amended (the “Exchange Act”); or (4) the date on which the Company has, during the previous three-year period, issued publicly or privately, more than $1.0 billion in non-convertible debt securities. Section 107 of the JOBS Act provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933 for complying with new or revised accounting standards. As an emerging growth company, the Company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. The Company elected to take advantage of the benefits of this extended transition period. Impact of Recently Adopted Accounting Guidance In January 2017, the Financial Accounting Standards Board, or FASB, issued ASU 2017‑04, Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. The amendments in this accounting standards update, or ASU, were issued to address concerns over the cost and complexity of the two-step goodwill impairment test and resulted in the removal of the second step of the test. The amendments require an entity to apply a one-step quantitative test and record the amount of goodwill impairment as the excess of a reporting unit’s carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit. The new guidance does not amend the optional qualitative assessment of goodwill impairment. The Company adopted the accounting standard during the first quarter of 2020. The adoption of the standard did not have a material impact on the Company’s consolidated financial statements. The Company’s policy is to test goodwill for impairment annually or on an interim basis if an event triggering impairment may have occurred. During the three months ended March 31, 2020, the economic turmoil and market volatility resulting from the COVID-19 pandemic resulted in a substantial decrease in the Company’s stock price and market capitalization. The Company believed such decrease was a triggering event requiring an interim goodwill impairment analysis. Under the new simplified guidance, the Company’s estimated fair value to a market participant as of March 31, 2020, exceeded its carrying amount resulting in no impairment charge for the period. In August 2018, the FASB issued ASU 2018‑13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement. The amendments of this ASU modify the disclosure requirements for fair value measurements by removing, modifying, or adding certain disclosures. The Company adopted this standard during the first quarter of 2020 and the adoption of this standard did not have a material impact on the Company’s consolidated financial statements. In August 2018, the FASB issued ASU 2018-15, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40). The amendments in this ASU align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal use software license). Implementation costs incurred in the application development stage are capitalized depending on the nature of the costs, while costs incurred during the preliminary project and post implementation stages are expensed as the activities are performed. The amendment also requires entities to expense the capitalized implementation costs of a hosting arrangement that is a service contract over the term of the hosting arrangement and in the same income statement line item as the fees associated with the hosting element. The Company adopted the accounting standard during the first quarter of 2020. The adoption of the standard did not have a material impact on the Company’s consolidated financial statements. In March 2020, various regulatory agencies, including the Board of Governors of the Federal Reserve System and the Federal Deposit Insurance Corporation, issued an interagency statement titled Interagency Statement on Loan Modifications and Reporting for Financial Institutions Working with Customers Affected by the Coronavirus , that encourages financial institutions to work prudently with borrowers who are or may be unable to meet their contractual payment obligations due to the effects of the COVID-19 pandemic. The interagency statement was effective immediately and impacted accounting for loan modifications. Under Accounting Standards Codification 310-40, Receivables – Troubled Debt Restructurings by Creditors (ASC 310-40) , a restructuring of debt constitutes a troubled debt restructuring, or TDR, if the creditor, for economic or legal reasons related to the debtor’s financial difficulties, grants a concession to the debtor that it would not otherwise consider. The regulatory agencies confirmed with the staff of the FASB that short-term modifications made on a good faith basis in response to the COVID-19 pandemic to borrowers who were current prior to any relief, are not to be considered TDRs. These include short-term modifications such as payment deferrals, fee waivers, extensions of repayment terms, or other delays in payment that are insignificant. Additionally, Section 4013 of the Coronavirus Aid, Relief and Economic Security Act, or CARES Act, that passed on March 27, 2020 further provides banks with the option to elect either or both of the following, from March 1, 2020 until the earlier of December 31, 2020 or the date that is 60 days after the date on which the national emergency concerning the COVID-19 pandemic declared by the President of the United States under the National Emergencies Act (50 U.S.C. 1601 et seq.) terminates: (i) to suspend the requirements under GAAP for loan modifications related to the COVID–19 pandemic that would otherwise be categorized as a TDR; and/or (ii) to suspend any determination of a loan modified as a result of the effects of the COVID–19 pandemic as being a TDR, including impairment for accounting purposes. If a bank elects a suspension noted above, the suspension (i) will be effective for the term of the loan modification, but solely with respect to any modification, including a forbearance arrangement, an interest rate modification, a repayment plan, and any other similar arrangement that defers or delays the payment of principal or interest, that occurs during the applicable period for a loan that was not more than 30 days past due as of December 31, 2019; and (ii) will not apply to any adverse impact on the credit of a borrower that is not related to the COVID–19 pandemic. The Company is applying this guidance to qualifying loan modifications. Impact of Recently Issued Accounting Standards The following ASUs have been issued by the FASB and may impact the Company’s consolidated financial statements in future reporting periods. In January 2020, the FASB issued ASU 2020-01, Investments – Equity Securities (Topic 321), Investments – Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815): Clarifying the Interactions between Topic 321, Topic 323 and Topic 815 . This ASU clarifies that an entity should consider observable transactions that require it to either apply or discontinue the equity method of accounting for the purposes of applying the fair value measurement alternative. The ASU will be effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020, with early adoption permitted. The Company does not expect adoption to have a material impact on the consolidated financial statements. In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting . This ASU provides optional expedients and exceptions for applying generally accepted accounting principles to contracts, hedging relationships and other transactions that reference the London Interbank Offered Rate, or LIBOR, or another reference rate expected to be discontinued, if certain criteria are met. LIBOR is used as an index rate for the Company’s interest-rate swaps and approximately 10.7% of the Company’s loans as of March 31, 2020. If reference rates are discontinued, the existing contracts will be modified to replace the discontinued rate with a replacement rate. For accounting purposes, such contract modifications would have to be evaluated to determine whether the modified contract is a new contract or a continuation of an existing contract. If they are considered new contracts, the previous contract would be extinguished. Under one of the optional expedients of ASU 2020-04, modifications of contracts within the scope of Topic 310, Receivables, and 470, Debt, will be accounted for by prospectively adjusting the effective interest rates and no such evaluation is required. When elected, the optional expedient for contract modifications must be applied consistently for all eligible contracts or eligible transactions. The expedients and exceptions in this update are available to all entities starting March 12, 2020 through December 31, 2022. The Company is in the process of evaluating the impact of this pronouncement on those financial assets where LIBOR is used as an index rate. Subsequent Events Subsequent events have been evaluated through May 7, 2020, which is the date the consolidated financial statements were available to be issued. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share | |
Earnings Per Share | Note 2: Earnings Per Share Basic earnings per common share are computed by dividing net income by the weighted average number of common shares outstanding for the period. Diluted earnings per common share are calculated by dividing net income by the weighted average number of shares adjusted for the dilutive effect of stock compensation. For the three months ended March 31, 2020 and 2019, 303,0000 of stock options and 3,946 of restricted stock awards, and 135,000 of stock options, respectively, were excluded from the calculation because they were deemed to be antidilutive. The following table presents the numerators and denominators for basic and diluted earnings per share computations for the three months ended March 31, 2020 and 2019: Three Months Ended March 31, 2020 2019 Net Income Available to Common Shareholders $ 7,443 $ 7,018 Weighted Average Common Stock Outstanding: Weighted Average Common Stock Outstanding (Basic) 28,791,494 30,097,638 Dilutive Effect of Stock Compensation 710,751 609,098 Weighted Average Common Stock Outstanding (Dilutive) 29,502,245 30,706,736 Basic Earnings per Common Share $ 0.26 $ 0.23 Diluted Earnings per Common Share 0.25 0.23 |
Securities
Securities | 3 Months Ended |
Mar. 31, 2020 | |
Securities | |
Securities | Note 3: Securities The following tables present the amortized cost and estimated fair value of securities with gross unrealized gains and losses at March 31, 2020 and December 31, 2019: March 31, 2020 Gross Gross Amortized Unrealized Unrealized Cost Gains Losses Fair Value Securities Available for Sale: Municipal Bonds $ 115,331 $ 7,897 $ (996) $ 122,232 Mortgage-Backed Securities 62,405 1,099 (711) 62,793 Corporate Securities 49,079 1,021 (160) 49,940 SBA Securities 47,107 35 (550) 46,592 Asset-Backed Securities 26,915 9 (1,164) 25,760 Total Securities Available for Sale $ 300,837 $ 10,061 $ (3,581) $ 307,317 December 31, 2019 Gross Gross Amortized Unrealized Unrealized Cost Gains Losses Fair Value Securities Available for Sale: U.S. Treasury Securities $ 4,990 $ 8 $ — $ 4,998 Municipal Bonds 99,441 6,338 (36) 105,743 Mortgage-Backed Securities 64,312 697 (281) 64,728 Corporate Securities 49,674 633 (131) 50,176 SBA Securities 50,126 35 (602) 49,559 Asset-Backed Securities 14,673 — — 14,673 Total Securities Available for Sale $ 283,216 $ 7,711 $ (1,050) $ 289,877 The following tables present the fair value and gross unrealized losses of securities with unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at March 31, 2020 and December 31, 2019: Less Than 12 Months 12 Months or Greater Total Unrealized Unrealized Unrealized Fair Value Losses Fair Value Losses Fair Value Losses March 31, 2020 Municipal Bonds $ 19,372 $ (989) $ 223 $ (7) $ 19,595 $ (996) Mortgage-Backed Securities 28,935 (684) 1,791 (27) 30,726 (711) Corporate Securities 10,298 (160) — — 10,298 (160) SBA Securities 9,191 (113) 28,908 (437) 38,099 (550) Asset-Backed Securities 16,685 (1,164) — — 16,685 (1,164) Total Securities Available for Sale $ 84,481 $ (3,110) $ 30,922 $ (471) $ 115,403 $ (3,581) Less Than 12 Months 12 Months or Greater Total Unrealized Unrealized Unrealized Fair Value Losses Fair Value Losses Fair Value Losses December 31, 2019 Municipal Bonds $ 2,760 $ (23) $ 1,390 $ (13) $ 4,150 $ (36) Mortgage-Backed Securities 32,276 (242) 3,098 (39) 35,374 (281) Corporate Securities 8,350 (131) — — 8,350 (131) SBA Securities 11,907 (64) 31,036 (538) 42,943 (602) Total Securities Available for Sale $ 55,293 $ (460) $ 35,524 $ (590) $ 90,817 $ (1,050) At March 31, 2020, 152 debt securities had unrealized losses with aggregate depreciation of approximately 3.0% from the Company’s amortized cost basis. At December 31, 2019, 110 debt securities had unrealized losses with aggregate depreciation of approximately 1.1% from the Company’s amortized cost basis. These unrealized losses related principally to changes in interest rates and were not due to changes in the financial condition of the issuer, the quality of any underlying assets, or applicable credit enhancements. In analyzing whether unrealized losses on debt securities are other than temporary, management considers whether the securities are issued by a government body or agency, whether a rating agency has downgraded the securities, industry analysts’ reports, the financial condition and performance of the issuer, and the quality of any underlying assets or credit enhancements. Since management has the ability and intent to hold these debt securities for the foreseeable future, no declines were deemed to be other than temporary as of March 31, 2020 and December 31, 2019. The following presents a summary of amortized cost and estimated fair value of debt securities by the lesser of expected call date or contractual maturity as of March 31, 2020. Call date is used when a call of the debt security is expected, determined by the Company when the security has a market value above its amortized cost. Contractual maturities will differ from expected maturities for mortgage-backed, SBA securities and asset-backed securities because borrowers may have the right to call or prepay obligations without penalties. March 31, 2020 Amortized Cost Fair Value Due in One Year or Less $ 9,793 $ 9,926 Due After One Year Through Five Years 59,106 60,660 Due After Five Years Through 10 Years 80,222 84,592 Due After 10 Years 15,289 16,994 Subtotal 164,410 172,172 Mortgage-Backed Securities 62,405 62,793 SBA Securities 47,107 46,592 Asset-Backed Securities 26,915 25,760 Totals $ 300,837 $ 307,317 As of March 31, 2020 and December 31, 2019, the securities portfolio was unencumbered. The following presents a summary of the proceeds from sales of securities available for sale, as well as gross gains and losses, for the three months ended March 31, 2020 and 2019: Three Months Ended March 31, 2020 2019 Proceeds From Sales of Securities $ 2,102 $ 8,150 Gross Gains on Sales 3 76 Gross Losses on Sales — (81) |
Loans
Loans | 3 Months Ended |
Mar. 31, 2020 | |
Loans | |
Loans | Note 4: Loans The following table presents the components of the loan portfolio at March 31, 2020 and December 31, 2019: March 31, December 31, 2020 2019 Commercial $ 299,425 $ 276,035 Construction and Land Development 183,350 196,776 Real Estate Mortgage: 1-4 Family Mortgage 272,590 260,611 Multifamily 536,380 515,014 CRE Owner Occupied 75,207 66,584 CRE Non-owner Occupied 631,541 592,545 Total Real Estate Mortgage Loans 1,515,718 1,434,754 Consumer and Other 4,324 4,473 Total Loans, Gross 2,002,817 1,912,038 Allowance for Loan Losses (24,585) (22,526) Net Deferred Loan Fees (5,336) (5,512) Total Loans, Net $ 1,972,896 $ 1,884,000 The following tables present the activity in the allowance for loan losses, by segment, for the three months ended March 31, 2020 and 2019: Construction CRE CRE and Land 1-‑4 Family Owner Non‑owner Consumer Three Months Ended March 31, 2020 Commercial Development Mortgage Multifamily Occupied Occupied and Other Unallocated Total Allowance for Loan Losses: Beginning Balance $ 3,058 $ 2,202 $ 2,839 $ 5,824 $ 792 $ 6,972 $ 85 $ 754 $ 22,526 Provision for Loan Losses 531 (71) 361 732 146 1,031 18 (648) 2,100 Loans Charged-off (34) — — — — — (13) — (47) Recoveries of Loans 2 — 2 — — — 2 — 6 Total Ending Allowance Balance $ 3,557 $ 2,131 $ 3,202 $ 6,556 $ 938 $ 8,003 $ 92 $ 106 $ 24,585 Three Months Ended March 31, 2019 Allowance for Loan Losses: Beginning Balance $ 2,898 $ 2,451 $ 2,597 $ 4,644 $ 808 $ 5,872 $ 65 $ 696 $ 20,031 Provision for Loan Losses 480 (354) 5 71 (18) 477 12 (73) 600 Loans Charged-off (19) — — — — — (17) — (36) Recoveries of Loans 2 — 9 — — — 1 — 12 Total Ending Allowance Balance $ 3,361 $ 2,097 $ 2,611 $ 4,715 $ 790 $ 6,349 $ 61 $ 623 $ 20,607 The following tables present the balance in the allowance for loan losses and the recorded investment in loans, by segment, based on impairment method as of March 31, 2020 and December 31, 2019: Construction CRE CRE and Land 1-‑4 Family Owner Non‑owner Consumer Allowance for Loan Losses at March 31, 2020 Commercial Development Mortgage Multifamily Occupied Occupied and Other Unallocated Total Individually Evaluated for Impairment $ 35 $ — $ — $ — $ — $ — $ 14 $ — $ 49 Collectively Evaluated for Impairment 3,522 2,131 3,202 6,556 938 8,003 78 106 24,536 Totals $ 3,557 $ 2,131 $ 3,202 $ 6,556 $ 938 $ 8,003 $ 92 $ 106 $ 24,585 Allowance for Loan Losses at December 31, 2019 Individually Evaluated for Impairment $ 31 $ — $ — $ — $ — $ — $ 14 $ — $ 45 Collectively Evaluated for Impairment 3,027 2,202 2,839 5,824 792 6,972 71 754 22,481 Totals $ 3,058 $ 2,202 $ 2,839 $ 5,824 $ 792 $ 6,972 $ 85 $ 754 $ 22,526 Construction CRE CRE and Land 1-‑4 Family Owner Non‑owner Consumer Loans at March 31, 2020 Commercial Development Mortgage Multifamily Occupied Occupied and Other Total Individually Evaluated for Impairment $ 267 $ 170 $ 1,243 $ — $ 1,847 $ 224 $ 14 $ 3,765 Collectively Evaluated for Impairment 299,158 183,180 271,347 536,380 73,360 631,317 4,310 1,999,052 Totals $ 299,425 $ 183,350 $ 272,590 $ 536,380 $ 75,207 $ 631,541 $ 4,324 $ 2,002,817 Loans at December 31, 2019 Individually Evaluated for Impairment $ 273 $ 176 $ 1,059 $ — $ 236 $ — $ 14 $ 1,758 Collectively Evaluated for Impairment 275,762 196,600 259,552 515,014 66,348 592,545 4,459 1,910,280 Totals $ 276,035 $ 196,776 $ 260,611 $ 515,014 $ 66,584 $ 592,545 $ 4,473 $ 1,912,038 The following table presents information regarding total carrying amounts and total unpaid principal balances of impaired loans by loan segment as of March 31, 2020 and December 31, 2019: March 31, 2020 December 31, 2019 Recorded Principal Related Recorded Principal Related Investment Balance Allowance Investment Balance Allowance Loans With No Related Allowance for Loan Losses: Commercial $ 157 $ 157 $ — $ 167 $ 167 $ — Construction and Land Development 170 779 — 176 785 — Real Estate Mortgage: HELOC and 1-4 Family Junior Mortgage 303 490 — 302 489 — 1st REM - Rentals 940 940 — 757 757 — CRE Owner Occupied 1,847 1,847 — 236 236 — CRE Non Owner Occupied 224 224 — — — — Totals 3,641 4,437 — 1,638 2,434 — Loans With An Allowance for Loan Losses: Commercial 110 113 35 106 109 31 Consumer and Other 14 14 14 14 14 14 Totals 124 127 49 120 123 45 Grand Totals $ 3,765 $ 4,564 $ 49 $ 1,758 $ 2,557 $ 45 The following table presents information regarding the average balances and interest income recognized on impaired loans by loan segment for the three months ended March 31, 2020 and 2019: Three Months Ended March 31, 2020 2019 Average Interest Average Interest Investment Recognized Investment Recognized Loans With No Related Allowance for Loan Losses: Commercial $ 163 $ 3 $ — $ — Construction and Land Development 175 — 198 — Real Estate Mortgage: HELOC and 1-4 Family Junior Mortgage 329 — 157 2 1st REM - Rentals 932 11 1,637 9 CRE Owner Occupied 1,837 25 449 6 CRE Non Owner Occupied 225 3 — — Consumer and Other — — 57 — Totals 3,661 42 2,498 17 Loans With An Allowance for Loan Losses: Commercial 111 — 688 9 Real Estate Mortgage: HELOC and 1-4 Family Junior Mortgage — — 308 — Consumer and Other 14 — — — 125 — 996 9 Grand Totals $ 3,786 $ 42 $ 3,494 $ 26 The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information and current economic trends, among other factors. The process of analyzing loans for changes in risk rating is ongoing through routine monitoring of the portfolio and annual internal credit reviews for credits meeting certain thresholds. The following tables present the risk category of loans by loan segment as of March 31, 2020 and December 31, 2019, based on the most recent analysis performed by management: March 31, 2020 Pass Watch Substandard Total Commercial $ 277,533 $ 21,625 $ 267 $ 299,425 Construction and Land Development 183,045 135 170 183,350 Real Estate Mortgage: HELOC and 1-4 Family Junior Mortgage 30,790 138 — 30,928 1st REM - 1-4 Family 34,253 123 176 34,552 LOCs and 2nd REM - Rentals 19,156 476 303 19,935 1st REM - Rentals 185,643 768 764 187,175 Multifamily 536,380 — — 536,380 CRE Owner Occupied 72,540 820 1,847 75,207 CRE Non-owner Occupied 609,598 21,719 224 631,541 Consumer and Other 4,310 — 14 4,324 Totals $ 1,953,248 $ 45,804 $ 3,765 $ 2,002,817 December 31, 2019 Pass Watch Substandard Total Commercial $ 275,741 $ 21 $ 273 $ 276,035 Construction and Land Development 196,462 138 176 196,776 Real Estate Mortgage: HELOC and 1-4 Family Junior Mortgage 28,483 138 — 28,621 1st REM - 1-4 Family 36,370 124 177 36,671 LOCs and 2nd REM - Rentals 17,890 479 302 18,671 1st REM - Rentals 174,781 1,287 580 176,648 Multifamily 515,014 — — 515,014 CRE Owner Occupied 65,411 — 1,173 66,584 CRE Non-owner Occupied 589,457 3,088 — 592,545 Consumer and Other 4,459 — 14 4,473 Totals $ 1,904,068 $ 5,275 $ 2,695 $ 1,912,038 The following tables present the aging of the recorded investment in past due loans by loan segment as of March 31, 2020 and December 31, 2019: Accruing Interest 30-89 Days 90 Days or March 31, 2020 Current Past Due More Past Due Nonaccrual Total Commercial $ 299,397 $ 21 $ — $ 7 $ 299,425 Construction and Land Development 183,180 — — 170 183,350 Real Estate Mortgage: HELOC and 1-4 Family Junior Mortgage 30,928 — — — 30,928 1st REM - 1-4 Family 34,552 — — — 34,552 LOCs and 2nd REM - Rentals 19,632 — — 303 19,935 1st REM - Rentals 187,049 — — 126 187,175 Multifamily 536,380 — — — 536,380 CRE Owner Occupied 75,207 — — — 75,207 CRE Non-owner Occupied 631,541 — — — 631,541 Consumer and Other 4,324 — — — 4,324 Totals $ 2,002,190 $ 21 $ — $ 606 $ 2,002,817 Accruing Interest 30-89 Days 90 Days or December 31, 2019 Current Past Due More Past Due Nonaccrual Total Commercial $ 276,028 $ — $ — $ 7 $ 276,035 Construction and Land Development 196,600 — — 176 196,776 Real Estate Mortgage: HELOC and 1-4 Family Junior Mortgage 28,621 — — — 28,621 1st REM - 1-4 Family 36,671 — — — 36,671 LOCs and 2nd REM - Rentals 18,527 — — 144 18,671 1st REM - Rentals 176,114 400 — 134 176,648 Multifamily 515,014 — — — 515,014 CRE Owner Occupied 66,584 — — — 66,584 CRE Non-owner Occupied 592,545 — — — 592,545 Consumer and Other 4,470 3 — — 4,473 Totals $ 1,911,174 $ 403 $ — $ 461 $ 1,912,038 At March 31, 2020, there were four loans classified as troubled debt restructurings with a current outstanding balance of $839. At December 31, 2019, there were three loans classified as troubled debt restructurings with an outstanding balance of $452. There was one new loan classified as a troubled debt restructuring during the three month period ended March 31, 2020, and no loans classified as troubled debt restructurings during the previous twelve months subsequently defaulted during the three months ended March 31, 2020. In response to the COVID-19 pandemic, the Company is offering short-term loan modifications to borrowers who were current and otherwise not past due as of December 31, 2019. These include short-term modifications in the form of payment deferrals, fee waivers, extensions of repayment terms, or other delays in payment that are insignificant. In accordance with regulatory guidance, these modifications are not considered to be troubled debt restructurings. The modifications completed in the three months ended March 31, 2020 were immaterial. |
Premises and Equipment
Premises and Equipment | 3 Months Ended |
Mar. 31, 2020 | |
Premises and Equipment | |
Premises and Equipment | Note 5: Premises and Equipment Premises and equipment are summarized as follows as of March 31, 2020 and December 31, 2019: Range of March 31, December 31, Useful Lives 2020 2019 Land N/A $ $ Building 15 - 39 Years Leasehold Improvements 3 ‑ 10 Years Furniture and Equipment 3 ‑ 5 Years Construction in Progress N/A Subtotal Accumulated Depreciation Totals $ $ Depreciation and amortization expense charged to noninterest expense for the three months ended March 31, 2020 and 2019, totaled $187 and $210, respectively. Construction in progress represents amounts paid for the construction of the Company’s new corporate headquarters building. Construction is expected to be completed in the third quarter of 2020. |
Deposits
Deposits | 3 Months Ended |
Mar. 31, 2020 | |
Deposits. | |
Deposits | Note 6: Deposits The following table presents the composition of deposits at March 31, 2020 and December 31, 2019: March 31, December 31, 2020 2019 Transaction Deposits $ 731,700 $ 712,136 Savings and Money Market Deposits 514,113 516,785 Time Deposits 393,340 360,027 Brokered Deposits 260,974 234,362 Totals $ 1,900,127 $ 1,823,310 |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities | 3 Months Ended |
Mar. 31, 2020 | |
Derivative Instruments and Hedging Activities | |
Derivative Instruments and Hedging Activities | Note 7: Derivative Instruments and Hedging Activities The Company uses derivative financial instruments, which consist of interest rate swaps, to assist in its interest rate risk management. The notional amount does not represent amounts exchanged by the parties. The amount exchanged is determined by reference to the notional amount and the other terms of the individual agreements. Derivative financial instruments are reported at fair value in other assets or other liabilities. The accounting for changes in the fair value of a derivative depends on whether it has been designated and qualifies as part of a hedging relationship. For derivatives not designated as hedges, the gain or loss is recognized in current earnings. Non-hedge Derivatives The Company enters into interest rate swaps to facilitate client transactions and meet their financing needs. Upon entering into these instruments to meet client needs, the Company enters into offsetting positions with large U.S. financial institutions in order to minimize the risk to the Company. These swaps are derivatives, but are not designated as hedging instruments. Interest The following table presents a summary of the Company’s interest rate swaps to facilitate customer transactions as of March 31, 2020 and December 31, 2019: March 31, 2020 December 31, 2019 Notional Estimated Notional Estimated Amount Fair Value Amount Fair Value Interest Rate Swap Agreements: Assets $ 50,113 $ 3,254 $ 7,140 $ 150 Liabilities 50,113 (3,254) 7,140 (150) Total $ 100,226 $ — $ 14,280 $ — Cash Flow Hedging Derivatives For derivative instruments that are designated and qualify as a cash flow hedge, the aggregate fair value of the derivative instrument is recorded in other assets or other liabilities with any gain or loss related to changes in fair value recorded in accumulated other comprehensive income, net of tax. The gain or loss is reclassified into earnings in the same period during which the hedged asset or liability affects earnings and is presented in the same income statement line item as the earnings effect of the hedged asset or liability. The Company utilizes cash flow hedges to manage interest rate exposure for the brokered certificate of deposit, wholesale borrowing, and notes payable portfolios. During the next 12 months, the Company estimates that $693 will be reclassified to interest expense. The following tables present a summary of the Company’s interest rate swaps designated as cash flow hedges as of March 31, 2020 and December 31, 2019: March 31, 2020 December 31, 2019 Notional Amount $ 102,500 $ 48,000 Weighted Average Pay Rate 1.35 % 1.89 % Weighted Average Receive Rate 1.51 % 2.25 % Weighted Average Maturity (Years) 4.48 3.53 Net Unrealized Gain (Loss) $ (3,533) $ (618) March 31, 2020 December 31, 2019 Notional Estimated Notional Estimated Amount Fair Value Amount Fair Value Interest Rate Swap Agreements: Assets $ — $ — $ 18,000 $ 134 Liabilities 102,500 (3,533) 30,000 (752) The following table presents the effect of derivative instruments in cash flow hedging relationships on the consolidated statements of income for the three months ended March 31, 2020 and 2019: Three Months Ended March 31, (dollars in thousands) 2020 2019 Derivatives in Location of Gain or Gain (Loss) Cash Flow Hedging (Loss) Reclassified Reclassified from Relationships from AOCI into Income AOCI into Earnings Interest Rate Swaps Interest Expense $ (18) $ — No amounts were reclassified from accumulated other comprehensive income into net income related to hedge ineffectiveness for these derivatives during the three months ended March 31, 2020 and 2019, and no amounts are expected to be reclassified from accumulated other comprehensive income into net income related to hedge ineffectiveness over the next twelve months. |
Tax Credit Investments
Tax Credit Investments | 3 Months Ended |
Mar. 31, 2020 | |
Tax Credit Investments | |
Tax Credit Investments | Note 8: Tax Credit Investments The Company invests in qualified affordable housing projects and federal historic projects for the purpose of community reinvestment and obtaining tax credits. The Company’s tax credit investments are limited to existing lending relationships with well-known developers and projects within the Company’s market area. The following table presents the Company’s investments in qualified affordable housing projects and other tax credit investments at March 31, 2020 and December 31, 2019: March 31, 2020 December 31, 2019 Investment Accounting Method Investment Unfunded Commitment (1) Investment Unfunded Commitment Low Income Housing Tax Credit (LIHTC) Proportional Amortization $ 2,077 $ — $ 2,148 $ — Federal Historic Tax Credit (FHTC) Equity 1,924 2,895 2,262 3,395 Total $ 4,001 $ 2,895 $ 4,410 $ 3,395 (1) All commitments are expected to be paid by the Company by March 31, 2021. The following table presents the amortization expense and tax benefit recognized for the Company’s qualified affordable housing projects and other tax credit investments for the three months ended March 31, 2020 and 2019: Three Months Ended March 31, 2020 2019 Amortization Expense (1) LIHTC $ 71 $ 72 FHTC 85 177 Total $ 156 $ 249 Tax Benefit Recognized (2) LIHTC $ (83) $ (83) FHTC (170) (214) Total $ (253) $ (297) (1) The amortization expense for the LIHTC investments are included in income tax expense. The amortization for the FHTC tax credits are included in noninterest expense. (2) All of the tax benefits recognized are included in income tax expense. The tax benefit recognized for the FHTC investments primarily reflects the tax credits generated from the investments, and excludes the net tax expense/benefit of the investments’ income/loss. |
Commitments, Contingencies and
Commitments, Contingencies and Credit Risk | 3 Months Ended |
Mar. 31, 2020 | |
Commitments, Contingencies and Credit Risk | |
Commitments, Contingencies and Credit Risk | Note 9: Commitments, Contingencies and Credit Risk Financial Instruments with Off-Balance Sheet Credit Risk The Company is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the consolidated balance sheets. The Company’s exposure to credit loss is represented by the contractual, or notional, amount of these commitments. The Company follows the same credit policies in making commitments as it does for on-balance sheet instruments. Since some of the commitments are expected to expire without being drawn upon and some of the commitments may not be drawn upon to the total extent of the commitment, the notional amount of these commitments does not necessarily represent future cash requirements. The following commitments were outstanding at March 31, 2020 and December 31, 2019: March 31, December 31, 2020 2019 Unfunded Commitments Under Lines of Credit $ 469,221 $ 500,962 Letters of Credit 73,364 79,225 Totals $ 542,585 $ 580,187 The Company had outstanding letters of credit with the FHLB in total amounts of $135,943 and $108,502 at March 31, 2020 and December 31, 2019, respectively, on behalf of customers and to secure public deposits. On August 27, 2018, the Bank and Reuter Walton Commercial, LLC (the “Contractor”) entered into a Standard Form of Agreement Between Owner and Contractor and the corresponding General Conditions of the Contract for Construction (collectively, the “Construction Contract”). Under the Construction Contract, the Contractor is constructing the core and shell of a new headquarters building for the Bank in St. Louis Park, Minnesota, and the Bank will pay the Contractor a contract price consisting of the cost of work plus a fee equal to 3.75% of the cost of work, subject to a guaranteed maximum price of $23,000, with anticipated construction completed in the third quarter of 2020. As of March 31, 2020, $19,232 had been paid under this Construction Contract. On December 3, 2019, the Bank entered into a separate contract with a third party relating to the construction of the build-out of the new headquarters building for the Bank. The total amount to be paid by the Bank under the contract is $6,321, with construction anticipated to be completed in the third quarter of 2020. As of March 31, 2020, $1,815 had been paid under this contract. Legal Contingencies Neither the Company nor any of its subsidiaries is a party, and no property of these entities is subject, to any material pending legal proceedings, other than ordinary routine litigation incidental to the Bank’s business. The Company does not know of any proceeding contemplated by a governmental authority against the Company or any of its subsidiaries. |
Stock Options and Restricted St
Stock Options and Restricted Stock Awards | 3 Months Ended |
Mar. 31, 2020 | |
Stock Options and Restricted Stock Awards | |
Stock Options and Restricted Stock Awards | Note 10: Stock Options and Restricted Stock Awards The Company established the Bridgewater Bancshares, Inc. 2012 Combined Incentive and Non-Statutory Stock Option Plan (the “2012 Plan”) under which the Company may grant options to its directors, officers, employees, and consultants for up to 750,000 shares of common stock. Both incentive stock options and nonqualified stock options may be granted under the 2012 Plan. The exercise price of each option equals the fair market value of the Company’s stock on the date of grant and the maximum term of each outstanding option is ten years. All outstanding options have been granted with vesting periods of five years. As of March 31, 2020 and 2019, there were no remaining shares of the Company’s common stock reserved for future option grants under the 2012 Plan. In 2017, the Company adopted the Bridgewater Bancshares, Inc. 2017 Combined Incentive and Non-Statutory Stock Option Plan (the “2017 Plan”). Under the 2017 Plan, the Company may grant options to its directors, officers, employees and consultants for up to 1,500,000 shares of common stock. Both incentive stock options and nonqualified stock options may be granted under the 2017 Plan. The exercise price of each option equals the fair market value of the Company’s stock on the date of grant and the maximum term of each outstanding option is ten years. All outstanding options have been granted with vesting periods of four or five years. As of March 31, 2020 and December 31, 2019, there were 310,600 remaining shares of the Company’s common stock reserved for future option grants under the 2017 Plan. In 2019, the Company adopted the Bridgewater Bancshares, Inc. 2019 Equity Incentive Plan (the “2019 EIP”). The types of awards which may be granted under the 2019 EIP include incentive and nonqualified stock options, stock appreciation rights, stock awards, restricted stock units, restricted stock and cash incentive awards. The Company may grant these awards to its directors, officers, employees and certain other service providers for up to 1,000,000 shares of common stock. The exercise price of each option equals the fair market value of the Company’s stock on the date of grant and the maximum term of each award is ten years. All outstanding awards have been granted with a vesting period of four years. As of March 31, 2020 and December 31, 2019, there were 830,373 and 867,040 of remaining shares of the Company’s common stock reserved for future grants under the 2019 EIP. Stock Options The fair value of each option award is estimated on the date of grant using a closed form option valuation (Black-Scholes) model that uses the assumptions noted in the table below. Expected volatilities are based on an industry index as described below. The expected term of options granted is based on historical data and represents the period of time that options granted are expected to be outstanding, which takes into account that the options are not transferable. The risk-free interest rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of the grant. Historically, the Company has not paid a dividend on its common stock and does not expect to do so in the near future. The Company used the S&P 600 CM Bank Index as its historical volatility index. The S&P 600 CM Bank Index is an index of publicly traded small capitalization, regional, commercial banks located throughout the United States. There were 54 banks in the index ranging in market capitalization from $500 million up to $4.5 billion. The weighted average assumptions used in the model for valuing stock option grants for the three months ended March 31, 2020, are as follows: March 31, 2020 Dividend Yield — % Expected Life 7 Years Expected Volatility 19.56 % Risk-Free Interest Rate 0.97 % The following table presents a summary of the status of the Company’s stock option grants for the three months ended March 31, 2020: March 31, 2020 Weighted Average Shares Exercise Price Outstanding at Beginning of Year 1,961,650 $ 7.08 Granted 25,000 12.67 Exercised — — Forfeitures — — Outstanding at Period End 1,986,650 $ 7.15 Options Exercisable at Period End 1,004,050 $ 5.01 For the three months ended March 31, 2020 and 2019, the Company recognized compensation expense for stock options of $218 and $175, respectively. The following table presents information pertaining to options outstanding at March 31, 2020: Options Outstanding Options Exercisable Number Remaining Number Exercise Price Outstanding Contractual Life Exercise Price Outstanding $ 2.13 74,750 3.0 Years $ 2.13 74,750 3.00 455,000 3.8 Years 3.00 455,000 3.58 45,000 4.8 Years 3.58 45,000 7.47 1,023,900 7.5 Years 7.47 402,300 13.22 25,000 8.1 Years 13.22 5,000 12.86 45,000 8.4 Years 12.86 9,000 12.94 30,000 8.5 Years 12.94 6,000 11.59 25,000 8.6 Years 11.59 5,000 11.15 10,000 8.9 Years 11.15 2,000 11.13 50,000 9.4 Years 11.13 — 12.92 178,000 9.7 Years 12.92 — 12.67 25,000 9.9 Years 12.67 — Totals 1,986,650 6.8 Years $ 7.15 1,004,050 As of March 31, 2020, there was $2,593 of total unrecognized compensation cost related to nonvested stock options granted under the 2012 Plan, 2017 Plan and 2019 EIP that is expected to be recognized over a weighted-average period of 4.8 years. The following presents an analysis of nonvested stock options issued and outstanding for the three months ended March 31, 2020: Weighted Number of Average Grant Shares Date Fair Value Nonvested Options at December 31, 2019 969,600 $ 3.08 Granted 25,000 2.94 Vested (12,000) 1.99 Forfeited — — Nonvested Options at March 31, 2020 982,600 $ 3.09 Restricted Stock Awards In 2019, the Company began granting restricted stock awards out of the 2019 EIP. These awards vest in equal annual installments on the first four anniversaries of the date of the grant. Nonvested restricted stock awards are classified as outstanding shares with voting and forfeitable dividend rights. The following table presents an analysis of nonvested restricted stock awards outstanding for the three months ended March 31, 2020: Weighted Number of Average Grant Shares Date Fair Value Nonvested Awards at December 31, 2019 132,960 $ 12.92 Granted 3,946 12.67 Vested — — Forfeited — — Nonvested Awards at March 31, 2020 136,906 $ 12.91 Compensation expense associated with the restricted stock awards is recognized on a straight-line basis over the period that the restrictions associated with the awards lapse based on the total cost of the award at the grant date. For the three months ended March 31, 2020, the Company recognized compensation expense for restricted stock awards of $108. No compensation expense was recognized for restricted stock awards for the three months ended March 31, 2019. As of March 31, 2020, there was $1,630 of total unrecognized compensation cost related to nonvested restricted stock awards granted under the 2019 EIP that is expected to be recognized over a period of four years. In addition, during the first quarter of 2020, the Company issued 7,721 shares of common stock to directors as a part of their compensation for their annual services on the Company’s board of directors. The aggregate value of the shares issued to directors of $75 is included in stock based compensation expense in the accompanying consolidated statements of shareholders’ equity. |
Regulatory Capital
Regulatory Capital | 3 Months Ended |
Mar. 31, 2020 | |
Regulatory Capital | |
Regulatory Capital | Note 11: Regulatory Capital Effective January 1, 2015, the capital requirements of the Company and the Bank were changed to implement the regulatory requirements of the Basel III capital reforms. The Basel III requirements, among other things, (i) apply a strengthened set of capital requirements to the Company and Bank, including requirements related to common equity as a component of core capital, (ii) implement a “capital conservation buffer” against risk and higher minimum tier 1 capital requirement, and (iii) revise the rules for calculating risk-weighted assets for purposes of such requirements. The rules made corresponding revisions to the prompt corrective action framework and include the new capital ratios and buffer requirements which were phased in incrementally, with full implementation on January 1, 2019. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve qualitative measures of their assets, liabilities and certain off-balance sheet items as calculated under regulatory accounting practices. The capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings and other factors. Quantitative measures established by regulation to ensure capital adequacy require the Company and Bank to maintain minimum amounts and ratios (set forth in the tables below and defined in the regulations) of Total Capital to Risk Weighted Assets, Tier 1 Capital to Risk Weighted Assets, Common Equity Tier 1 Capital to Risk Weighted Assets, and Tier 1 Capital to Average Assets. The following tables present the Company and the Bank’s capital amounts and ratios as of March 31, 2020 and December 31, 2019: Minimum Required For Capital Adequacy To be Well Capitalized For Capital Adequacy Purposes Plus Capital Under Prompt Corrective Actual Purposes Conservation Buffer Action Regulations March 31, 2020 Amount Ratio Amount Ratio Amount Ratio Amount Ratio (dollars in thousands) Company (Consolidated): Total Risk-Based Capital $ 292,080 13.38 % $ 174,641 8.00 % $ 229,216 10.50 % N/A N/A Tier 1 Risk-Based Capital 242,376 11.10 130,980 6.00 185,556 8.50 N/A N/A Common Equity Tier 1 Capital 242,376 11.10 98,235 4.50 152,810 7.00 N/A N/A Tier 1 Leverage Ratio 242,376 10.51 92,259 4.00 92,259 4.00 N/A N/A Bank: Total Risk-Based Capital $ 276,487 12.67 % $ 174,523 8.00 % $ 229,062 10.50 % $ 218,154 10.00 % Tier 1 Risk-Based Capital 251,542 11.53 130,893 6.00 185,431 8.50 174,523 8.00 Common Equity Tier 1 Capital 251,542 11.53 98,169 4.50 152,708 7.00 141,800 6.50 Tier 1 Leverage Ratio 251,542 10.93 92,088 4.00 92,088 4.00 115,110 5.00 Minimum Required For Capital Adequacy To be Well Capitalized For Capital Adequacy Purposes Plus Capital Under Prompt Corrective Actual Purposes Conservation Buffer Action Regulations December 31, 2019 Amount Ratio Amount Ratio Amount Ratio Amount Ratio (dollars in thousands) Company (Consolidated): Total Risk-Based Capital $ 269,613 12.98 % $ 166,163 8.00 % $ 218,089 10.50 % N/A N/A Tier 1 Risk-Based Capital 236,533 11.39 124,623 6.00 176,549 8.50 N/A N/A Common Equity Tier 1 Capital 236,533 11.39 93,467 4.50 145,393 7.00 N/A N/A Tier 1 Leverage Ratio 236,533 10.69 88,498 4.00 88,498 4.00 N/A N/A Bank: Total Risk-Based Capital $ 252,501 12.16 % $ 166,137 8.00 % $ 218,055 10.50 % $ 207,671 10.00 % Tier 1 Risk-Based Capital 243,461 11.72 124,603 6.00 176,521 8.50 166,137 8.00 Common Equity Tier 1 Capital 243,461 11.72 93,452 4.50 145,370 7.00 134,986 6.50 Tier 1 Leverage Ratio 243,461 11.01 88,455 4.00 88,455 4.00 110,569 5.00 The Company and the Bank must maintain a capital conservation buffer, as defined by Basel III regulatory capital guidelines, in order to avoid limitations on capital distributions, including dividend payments, stock repurchases and certain discretionary bonus payments to executive officers. |
Stock Repurchase Program
Stock Repurchase Program | 3 Months Ended |
Mar. 31, 2020 | |
Stock Repurchase Program | |
Stock Repurchase Program | Note 12: Stock Repurchase Program On January 22, 2019, the Company adopted a stock repurchase program. Under the repurchase program, the Company may repurchase up to $15.0 million of its common stock during the 24-month period beginning on January 22, 2019. The stock repurchase program permits the Company’s management to acquire shares of the Company’s common stock from time to time in the open market in accordance with Rule 10b-18 of the Exchange Act or in privately negotiated transactions at prices management considers to be attractive and in the best interests of the Company and its shareholders. The stock repurchase program does not obligate the Company to repurchase shares of its common stock. Any repurchases are subject to compliance with applicable laws and regulations. Repurchases will be conducted in consideration of general market and economic conditions, regulatory requirements, availability of funds, and other relevant considerations, as determined by the Company. The stock repurchase program may be modified, suspended or discontinued at any time at the discretion of the Company’s Board of Directors. On July 23, 2019, the Company’s Board of Directors approved a $10.0 million increase to the Company’s stock repurchase program, increasing the authorization to repurchase common stock under the program from a total of $15.0 million to up to a total of $25.0 million. The stock repurchase program continues through January 22, 2021. During the first quarter of 2020, the Company repurchased 177,864 shares of its common stock, representing less than 1% of the Company’s outstanding shares. Shares were repurchased at a weighted average price of $11.52 for a total of $2.0 million. All shares repurchased under the stock repurchase program were converted to authorized but unissued shares. At March 31, 2020, the remaining amount that could be used to repurchase shares under the stock repurchase program was $8.0 million. Although the stock repurchase program remains in place, the Company has not repurchased any shares since March 16, 2020. The Company remains committed to maintaining strong capital levels and will consider the current economic environment and the uncertainty of the long-term impact of the COVID-19 pandemic when evaluating its future utilization of the stock repurchase program. Management currently does not expect to begin repurchasing shares again until the COVID-19 pandemic has subsided. |
Fair Value Measurement
Fair Value Measurement | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Measurement | |
Fair Value Measurement | Note 13: Fair Value Measurement The Company categorizes its assets and liabilities measured at fair value into a three-level hierarchy based on the priority of the inputs to the valuation technique used to determine fair value. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used in the determination of the fair value measurement fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the fair value measurement. Assets and liabilities valued at fair value are categorized based on the inputs to the valuation techniques as follows: Level 1 – Inputs that utilized quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. Level 2 – Inputs that include quoted prices for similar assets and liabilities in active markets and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instruments. Fair values for these instruments are estimated using pricing models, quoted prices of securities with similar characteristics, or discounted cash flows. Level 3 – Inputs that are unobservable for the asset or liability, which are typically based on an entity’s own assumptions, as there is little, if any, related market activity. Subsequent to initial recognition, the Company may re-measure the carrying value of assets and liabilities measured on a nonrecurring basis to fair value. Adjustments to fair value usually result when certain assets are impaired. Such assets are written down from their carrying amounts to their fair value. Professional standards allow entities the irrevocable option to elect to measure certain financial instruments and other items at fair value for the initial and subsequent measurement on an instrument-by-instrument basis. The Company adopted the policy to value certain financial instruments at fair value. The Company has not elected to measure any existing financial instruments at fair value; however, it may elect to measure newly acquired financial instruments at fair value in the future. Recurring Basis The Company uses fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. The following tables present the balances of the assets and liabilities measured at fair value on a recurring basis as of March 31, 2020 and December 31, 2019: March 31, 2020 Level 1 Level 2 Level 3 Total Fair Value of Financial Assets: Securities Available for Sale: Municipal Bonds $ — $ 122,232 $ — $ 122,232 Mortgage-Backed Securities — 62,793 — 62,793 Corporate Securities — 49,940 — 49,940 SBA Securities — 46,592 — 46,592 Asset-Backed Securities — 25,760 — 25,760 Interest Rate Swaps — 3,254 — 3,254 Total Fair Value of Financial Assets $ — $ 310,571 $ — $ 310,571 Fair Value of Financial Liabilities: Interest Rate Swaps $ — $ 6,787 $ — $ 6,787 Total Fair Value of Financial Liabilities $ — $ 6,787 $ — $ 6,787 December 31, 2019 Level 1 Level 2 Level 3 Total Fair Value of Financial Assets: Securities Available for Sale: U.S. Treasury Securities $ 4,998 $ — $ — $ 4,998 Municipal Bonds — 105,743 — 105,743 Mortgage-Backed Securities — 64,728 — 64,728 Corporate Securities — 50,176 — 50,176 SBA Securities — 49,559 — 49,559 Asset-Backed Securities — 14,673 — 14,673 Interest Rate Swaps — 284 — 284 Total Fair Value of Financial Assets $ 4,998 $ 285,163 $ — $ 290,161 Fair Value of Financial Liabilities: Interest Rate Swaps $ — $ 902 $ — $ 902 Total Fair Value of Financial Liabilities $ — $ 902 $ — $ 902 Investment Securities When available, the Company uses quoted market prices to determine the fair value of investment securities; such items are classified in Level 1 of the fair value hierarchy. For the Company’s investments, when quoted prices are not available for identical securities in an active market, the Company determines fair value utilizing vendors who apply matrix pricing for similar bonds where no price is observable or may compile prices from various sources. These models are primarily industry-standard models that consider various assumptions, including time value, yield curve, volatility factors, prepayment speeds, default rates, loss severity, current market, and contractual prices for the underlying financial instruments, as well as other relevant economic measures. Substantially, all of these assumptions are observable in the marketplace and can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace. Fair values from these models are verified, where possible, against quoted market prices for recent trading activity of assets with similar characteristics to the security being valued. Such methods are generally classified as Level 2. However, when prices from independent sources vary, or cannot be obtained or corroborated, a security is generally classified as Level 3. Interest Rate Swaps Interest rate swaps are traded in over-the-counter markets where quoted market prices are not readily available. For those interest rate swaps, fair value is determined using internally developed models of a third party that uses primarily market observable inputs, such as yield curves and option volatilities, and accordingly are valued using Level 2 inputs. Nonrecurring Basis Certain assets are measured at fair value on a nonrecurring basis. These assets are not measured at fair value on an ongoing basis; however, they are subject to fair value adjustments in certain circumstances, such as when there is evidence of impairment or a change in the amount of previously recognized impairment. The following tables present net impairment losses related to nonrecurring fair value measurements of certain assets at March 31, 2020 and December 31, 2019: March 31, 2020 Level 1 Level 2 Level 3 Loss Impaired Loans $ — $ 75 $ — $ 49 Totals $ — $ 75 $ — $ 49 December 31, 2019 Level 1 Level 2 Level 3 Loss Impaired Loans $ — $ 75 $ — $ 206 Totals $ — $ 75 $ — $ 206 Impaired Loans In accordance with the provisions of the loan impairment guidance, impairment is measured on loans when it is probable that payment of interest and principal will not be made in accordance with the contractual terms of the loan agreement. The fair value of impaired loans is estimated using one of several methods, including collateral value, market value of similar debt, or discounted cash flows. Those impaired loans not requiring an allowance represent loans for which the fair value of the expected repayments or collateral exceeds the recorded investments in such loans. Impaired loans for which an allowance is established based on the fair value of collateral require classification in the fair value hierarchy. Collateral values are estimated using Level 2 inputs based on customized discounting criteria. Impairment amounts on impaired loans represent specific valuation allowance and write-downs during the period presented on impaired loans that were individually evaluated for impairment based on the estimated fair value of the collateral less estimated selling costs, excluding impaired loans fully charged-off. Fair Value Disclosure of fair value information about financial instruments, for which it is practicable to estimate that value, is required whether or not recognized in the consolidated balance sheets. In cases where quoted market prices are not available, fair values are based on estimates using present value of cash flow or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimate of future cash flows. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases could not be realized in immediate settlement of the instruments. Certain financial instruments with a fair value that is not practicable to estimate and all non-financial instruments are excluded from the disclosure requirements. Accordingly, the aggregate fair value amounts presented do not necessarily represent the underlying value of the Company. Fair value estimates are made at a specific point in time based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time the Company’s entire holdings of a particular instrument. Because no market exists for a significant portion of the Company’s financial instruments, fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments, and other factors. These estimates are subjective in nature and involve uncertainties and matters that could affect the estimates. Fair value estimates are based on existing on and off-balance sheet financial instruments without attempting to estimate the value of anticipated future business. Deposits with no stated maturities are defined as having a fair value equivalent to the amount payable on demand. This prohibits adjusting fair value derived from retaining those deposits for an expected future period of time. This component, commonly referred to as a deposit base intangible, is neither considered in the above amounts nor is it recorded as an intangible asset on the balance sheet. In addition, the tax ramifications related to the realization of the unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in the estimates. The following tables present the carrying amount and estimated fair values of financial instruments at March 31, 2020 and December 31, 2019: March 31, 2020 Fair Value Hierarchy Carrying Estimated Amount Level 1 Level 2 Level 3 Fair Value Financial Assets: Cash and Due From Banks $ 61,526 $ 61,526 $ — $ — $ 61,526 Bank-Owned Certificates of Deposit 2,895 — 2,968 — 2,968 Securities Available for Sale 307,317 — 307,317 — 307,317 FHLB Stock, at Cost 11,017 — 11,017 — 11,017 Loans, Net 1,972,896 — 1,989,365 — 1,989,365 Accrued Interest Receivable 7,102 — 7,102 — 7,102 Interest Rate Swaps 3,254 — 3,254 — 3,254 Financial Liabilities: Deposits $ 1,900,127 $ — $ 1,912,436 $ — $ 1,912,436 Notes Payable 12,500 — 12,525 — 12,525 FHLB Advances 207,500 — 218,362 — 218,362 Subordinated Debentures 24,759 — 26,630 — 26,630 Accrued Interest Payable 1,688 — 1,688 — 1,688 Interest Rate Swaps 6,787 — 6,787 — 6,787 December 31, 2019 Fair Value Hierarchy Carrying Estimated Amount Level 1 Level 2 Level 3 Fair Value Financial Assets: Cash and Due From Banks $ 31,935 $ 31,935 $ — $ — $ 31,935 Bank-Owned Certificates of Deposit 2,654 — 2,677 — 2,677 Securities Available for Sale 289,877 4,998 284,879 — 289,877 FHLB Stock, at Cost 7,824 — 7,824 — 7,824 Loans, Net 1,884,000 — 1,891,987 — 1,891,987 Accrued Interest Receivable 6,775 — 6,775 — 6,775 Interest Rate Swaps 284 — 284 — 284 Financial Liabilities: Deposits $ 1,823,310 $ — $ 1,821,915 $ — $ 1,821,915 Notes Payable 13,000 — 13,022 — 13,022 FHLB Advances 136,500 — 141,152 — 141,152 Subordinated Debentures 24,733 — 25,309 — 25,309 Accrued Interest Payable 1,982 — 1,982 — 1,982 Interest Rate Swaps 902 — 902 — 902 The following methods and assumptions were used by the Company to estimate fair value of consolidated financial statements not previously discussed. Cash and due from banks – The carrying amount of cash and cash equivalents approximates their fair value. Bank-owned certificates of deposit – Fair values of bank-owned certificates of deposit are estimated using the discounted cash flow analysis based on current rates for similar types of deposits. FHLB stock – The carrying amount of FHLB stock approximates its fair value. Loans, Net – Fair values for loans are estimated based on discounted cash flows, using interest rates currently being offered for loans with similar terms to borrowers with similar credit quality. Accrued interest receivable – The carrying amount of accrued interest receivable approximates its fair value since it is short term in nature and does not present anticipated credit concerns. Deposits – The fair values disclosed for demand deposits without stated maturities (interest and noninterest transaction, savings, and money market accounts) are equal to the amount payable on demand at the reporting date (their carrying amounts). Fair values for the fixed-rate certificates of deposit are estimated using a discounted cash flow calculation that applies interest rates currently being offered on certificates to a schedule of aggregated expected monthly maturities on time deposits. Federal funds purchased – The carrying amount of federal funds purchased approximates the fair value. Notes payable and subordinated debentures – The fair values of the Company’s notes payable and subordinated debt are estimated using a discounted cash flow analysis, based on the Company’s current incremental borrowing rate for similar types of borrowing arrangements. FHLB advances – The fair values of the Company’s FHLB advances are estimated using discounted cash flow analysis based on the Company’s current incremental borrowing rates for similar types of borrowing agreements. Accrued interest payable – The carrying amount of accrued interest payable approximates its fair value since it is short term in nature. Off-balance sheet instruments – Fair values of the Company’s off-balance sheet instruments (lending commitments and unused lines of credit) are based on fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements, the counterparties’ credit standing and discounted cash flow analysis. The fair value of these off-balance-sheet items approximates the recorded amounts of the related fees and was not material at March 31, 2020 and December 31, 2019. Limitations – The fair value of a financial instrument is the current amount that would be exchanged between market participants, other than in a forced liquidation. Fair value is best determined based upon quoted market prices. However, in many instances, there are no quoted market prices for the Company’s various financial instruments. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. Accordingly, the fair value estimates may not be realized in an immediate settlement of the instrument. Consequently, the aggregate fair value amounts presented may not necessarily represent the underlying fair value of the Company. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2020 | |
Subsequent Events | |
Subsequent Events | Note 14: Subsequent Events COVID-19 and Current Economic Conditions As of May 5, 2020, total COVID-19 related loan modifications had totaled $288,019, representing 157 borrowers and approximately 15% of the total loan portfolio. The CARES Act provided over $2.0 trillion in emergency economic relief to individuals and businesses impacted by the COVID-19 pandemic. The CARES Act authorized the Small Business Administration, or SBA, to temporarily guarantee loans under a new 7(a) loan program called the Paycheck Protection Program, or PPP. As a qualified SBA lender, the Company was automatically authorized to originate PPP loans. As of May 5, 2020, the Company had received SBA approval to fund over 1,000 PPP loans, totaling approximately $181,847. In response to uncertainty regarding the severity and duration of the COVID-19 pandemic, the Company has taken additional action to ensure the strength of its liquidity position. The Company has established borrowing capacity through the Federal Reserve lending facility in connection with funding PPP loans. |
Description of the Business a_2
Description of the Business and Summary of Significant Accounting Policies (Policies ) | 3 Months Ended |
Mar. 31, 2020 | |
Description of the Business and Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation The accompanying unaudited consolidated financial statements were prepared in accordance with instructions for Form 10‑Q and, therefore, do not include all disclosures necessary for a complete presentation of the consolidated balance sheets, consolidated statements of income, consolidated statements of comprehensive income, consolidated statements of shareholders’ equity and consolidated statements of cash flows in conformity with U.S. generally accepted accounting principles (“GAAP”). However, all normal recurring adjustments which are, in the opinion of management, necessary for the fair presentation of the interim financial statements have been included. The results of operations for the three-month period ended March 31, 2020 are not necessarily indicative of the results which may be expected for the entire year. For further information, refer to the consolidated financial statements and footnotes included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on March 12, 2020. |
Principles of Consolidation | Principles of Consolidation These consolidated financial statements include the amounts of the Company, the Bank, with locations in Bloomington, Greenwood, Minneapolis (2), St. Louis Park, Orono, and St. Paul, Minnesota, BWB Holdings, LLC, Bridgewater Investment Management, Inc., and Bridgewater Risk Management, Inc. All significant intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates in Preparation of Financial Statements | Use of Estimates in Preparation of Financial Statements The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Information available which could affect judgements includes, but is not limited to, changes in interest rates, changes in the performance of the economy, including COVID-19 pandemic related changes, and changes in the financial condition of borrowers. Material estimates that are particularly susceptible to significant change in the near term include the valuation of securities, determination of the allowance for loan losses, calculation of deferred tax assets, fair value of financial instruments, and investment securities impairment. |
Impact of Recent Accounting Standards | Impact of Recently Adopted Accounting Guidance In January 2017, the Financial Accounting Standards Board, or FASB, issued ASU 2017‑04, Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. The amendments in this accounting standards update, or ASU, were issued to address concerns over the cost and complexity of the two-step goodwill impairment test and resulted in the removal of the second step of the test. The amendments require an entity to apply a one-step quantitative test and record the amount of goodwill impairment as the excess of a reporting unit’s carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit. The new guidance does not amend the optional qualitative assessment of goodwill impairment. The Company adopted the accounting standard during the first quarter of 2020. The adoption of the standard did not have a material impact on the Company’s consolidated financial statements. The Company’s policy is to test goodwill for impairment annually or on an interim basis if an event triggering impairment may have occurred. During the three months ended March 31, 2020, the economic turmoil and market volatility resulting from the COVID-19 pandemic resulted in a substantial decrease in the Company’s stock price and market capitalization. The Company believed such decrease was a triggering event requiring an interim goodwill impairment analysis. Under the new simplified guidance, the Company’s estimated fair value to a market participant as of March 31, 2020, exceeded its carrying amount resulting in no impairment charge for the period. In August 2018, the FASB issued ASU 2018‑13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement. The amendments of this ASU modify the disclosure requirements for fair value measurements by removing, modifying, or adding certain disclosures. The Company adopted this standard during the first quarter of 2020 and the adoption of this standard did not have a material impact on the Company’s consolidated financial statements. In August 2018, the FASB issued ASU 2018-15, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40). The amendments in this ASU align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal use software license). Implementation costs incurred in the application development stage are capitalized depending on the nature of the costs, while costs incurred during the preliminary project and post implementation stages are expensed as the activities are performed. The amendment also requires entities to expense the capitalized implementation costs of a hosting arrangement that is a service contract over the term of the hosting arrangement and in the same income statement line item as the fees associated with the hosting element. The Company adopted the accounting standard during the first quarter of 2020. The adoption of the standard did not have a material impact on the Company’s consolidated financial statements. In March 2020, various regulatory agencies, including the Board of Governors of the Federal Reserve System and the Federal Deposit Insurance Corporation, issued an interagency statement titled Interagency Statement on Loan Modifications and Reporting for Financial Institutions Working with Customers Affected by the Coronavirus , that encourages financial institutions to work prudently with borrowers who are or may be unable to meet their contractual payment obligations due to the effects of the COVID-19 pandemic. The interagency statement was effective immediately and impacted accounting for loan modifications. Under Accounting Standards Codification 310-40, Receivables – Troubled Debt Restructurings by Creditors (ASC 310-40) , a restructuring of debt constitutes a troubled debt restructuring, or TDR, if the creditor, for economic or legal reasons related to the debtor’s financial difficulties, grants a concession to the debtor that it would not otherwise consider. The regulatory agencies confirmed with the staff of the FASB that short-term modifications made on a good faith basis in response to the COVID-19 pandemic to borrowers who were current prior to any relief, are not to be considered TDRs. These include short-term modifications such as payment deferrals, fee waivers, extensions of repayment terms, or other delays in payment that are insignificant. Additionally, Section 4013 of the Coronavirus Aid, Relief and Economic Security Act, or CARES Act, that passed on March 27, 2020 further provides banks with the option to elect either or both of the following, from March 1, 2020 until the earlier of December 31, 2020 or the date that is 60 days after the date on which the national emergency concerning the COVID-19 pandemic declared by the President of the United States under the National Emergencies Act (50 U.S.C. 1601 et seq.) terminates: (i) to suspend the requirements under GAAP for loan modifications related to the COVID–19 pandemic that would otherwise be categorized as a TDR; and/or (ii) to suspend any determination of a loan modified as a result of the effects of the COVID–19 pandemic as being a TDR, including impairment for accounting purposes. If a bank elects a suspension noted above, the suspension (i) will be effective for the term of the loan modification, but solely with respect to any modification, including a forbearance arrangement, an interest rate modification, a repayment plan, and any other similar arrangement that defers or delays the payment of principal or interest, that occurs during the applicable period for a loan that was not more than 30 days past due as of December 31, 2019; and (ii) will not apply to any adverse impact on the credit of a borrower that is not related to the COVID–19 pandemic. The Company is applying this guidance to qualifying loan modifications. Impact of Recently Issued Accounting Standards The following ASUs have been issued by the FASB and may impact the Company’s consolidated financial statements in future reporting periods. In January 2020, the FASB issued ASU 2020-01, Investments – Equity Securities (Topic 321), Investments – Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815): Clarifying the Interactions between Topic 321, Topic 323 and Topic 815 . This ASU clarifies that an entity should consider observable transactions that require it to either apply or discontinue the equity method of accounting for the purposes of applying the fair value measurement alternative. The ASU will be effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020, with early adoption permitted. The Company does not expect adoption to have a material impact on the consolidated financial statements. In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting . This ASU provides optional expedients and exceptions for applying generally accepted accounting principles to contracts, hedging relationships and other transactions that reference the London Interbank Offered Rate, or LIBOR, or another reference rate expected to be discontinued, if certain criteria are met. LIBOR is used as an index rate for the Company’s interest-rate swaps and approximately 10.7% of the Company’s loans as of March 31, 2020. If reference rates are discontinued, the existing contracts will be modified to replace the discontinued rate with a replacement rate. For accounting purposes, such contract modifications would have to be evaluated to determine whether the modified contract is a new contract or a continuation of an existing contract. If they are considered new contracts, the previous contract would be extinguished. Under one of the optional expedients of ASU 2020-04, modifications of contracts within the scope of Topic 310, Receivables, and 470, Debt, will be accounted for by prospectively adjusting the effective interest rates and no such evaluation is required. When elected, the optional expedient for contract modifications must be applied consistently for all eligible contracts or eligible transactions. The expedients and exceptions in this update are available to all entities starting March 12, 2020 through December 31, 2022. The Company is in the process of evaluating the impact of this pronouncement on those financial assets where LIBOR is used as an index rate. |
Subsequent Events | Subsequent Events Subsequent events have been evaluated through May 7, 2020, which is the date the consolidated financial statements were available to be issued. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share | |
Schedule of numerators and denominators for basic and diluted earnings per share computations | Note 2: Earnings Per Share Basic earnings per common share are computed by dividing net income by the weighted average number of common shares outstanding for the period. Diluted earnings per common share are calculated by dividing net income by the weighted average number of shares adjusted for the dilutive effect of stock compensation. For the three months ended March 31, 2020 and 2019, 303,0000 of stock options and 3,946 of restricted stock awards, and 135,000 of stock options, respectively, were excluded from the calculation because they were deemed to be antidilutive. The following table presents the numerators and denominators for basic and diluted earnings per share computations for the three months ended March 31, 2020 and 2019: Three Months Ended March 31, 2020 2019 Net Income Available to Common Shareholders $ 7,443 $ 7,018 Weighted Average Common Stock Outstanding: Weighted Average Common Stock Outstanding (Basic) 28,791,494 30,097,638 Dilutive Effect of Stock Compensation 710,751 609,098 Weighted Average Common Stock Outstanding (Dilutive) 29,502,245 30,706,736 Basic Earnings per Common Share $ 0.26 $ 0.23 Diluted Earnings per Common Share 0.25 0.23 |
Securities (Tables)
Securities (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Securities | |
Summary of the amortized cost and estimated fair value of securities with gross unrealized gains and losses | The following tables present the amortized cost and estimated fair value of securities with gross unrealized gains and losses at March 31, 2020 and December 31, 2019: March 31, 2020 Gross Gross Amortized Unrealized Unrealized Cost Gains Losses Fair Value Securities Available for Sale: Municipal Bonds $ 115,331 $ 7,897 $ (996) $ 122,232 Mortgage-Backed Securities 62,405 1,099 (711) 62,793 Corporate Securities 49,079 1,021 (160) 49,940 SBA Securities 47,107 35 (550) 46,592 Asset-Backed Securities 26,915 9 (1,164) 25,760 Total Securities Available for Sale $ 300,837 $ 10,061 $ (3,581) $ 307,317 December 31, 2019 Gross Gross Amortized Unrealized Unrealized Cost Gains Losses Fair Value Securities Available for Sale: U.S. Treasury Securities $ 4,990 $ 8 $ — $ 4,998 Municipal Bonds 99,441 6,338 (36) 105,743 Mortgage-Backed Securities 64,312 697 (281) 64,728 Corporate Securities 49,674 633 (131) 50,176 SBA Securities 50,126 35 (602) 49,559 Asset-Backed Securities 14,673 — — 14,673 Total Securities Available for Sale $ 283,216 $ 7,711 $ (1,050) $ 289,877 |
Summary of fair value and gross unrealized losses of securities with unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position | The following tables present the fair value and gross unrealized losses of securities with unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at March 31, 2020 and December 31, 2019: Less Than 12 Months 12 Months or Greater Total Unrealized Unrealized Unrealized Fair Value Losses Fair Value Losses Fair Value Losses March 31, 2020 Municipal Bonds $ 19,372 $ (989) $ 223 $ (7) $ 19,595 $ (996) Mortgage-Backed Securities 28,935 (684) 1,791 (27) 30,726 (711) Corporate Securities 10,298 (160) — — 10,298 (160) SBA Securities 9,191 (113) 28,908 (437) 38,099 (550) Asset-Backed Securities 16,685 (1,164) — — 16,685 (1,164) Total Securities Available for Sale $ 84,481 $ (3,110) $ 30,922 $ (471) $ 115,403 $ (3,581) Less Than 12 Months 12 Months or Greater Total Unrealized Unrealized Unrealized Fair Value Losses Fair Value Losses Fair Value Losses December 31, 2019 Municipal Bonds $ 2,760 $ (23) $ 1,390 $ (13) $ 4,150 $ (36) Mortgage-Backed Securities 32,276 (242) 3,098 (39) 35,374 (281) Corporate Securities 8,350 (131) — — 8,350 (131) SBA Securities 11,907 (64) 31,036 (538) 42,943 (602) Total Securities Available for Sale $ 55,293 $ (460) $ 35,524 $ (590) $ 90,817 $ (1,050) |
Schedule of contractual maturities of debt | The following presents a summary of amortized cost and estimated fair value of debt securities by the lesser of expected call date or contractual maturity as of March 31, 2020. Call date is used when a call of the debt security is expected, determined by the Company when the security has a market value above its amortized cost. Contractual maturities will differ from expected maturities for mortgage-backed, SBA securities and asset-backed securities because borrowers may have the right to call or prepay obligations without penalties. March 31, 2020 Amortized Cost Fair Value Due in One Year or Less $ 9,793 $ 9,926 Due After One Year Through Five Years 59,106 60,660 Due After Five Years Through 10 Years 80,222 84,592 Due After 10 Years 15,289 16,994 Subtotal 164,410 172,172 Mortgage-Backed Securities 62,405 62,793 SBA Securities 47,107 46,592 Asset-Backed Securities 26,915 25,760 Totals $ 300,837 $ 307,317 |
Summary of the proceeds from sales of securities available for sale, as well as gross gains and losses | The following presents a summary of the proceeds from sales of securities available for sale, as well as gross gains and losses, for the three months ended March 31, 2020 and 2019: Three Months Ended March 31, 2020 2019 Proceeds From Sales of Securities $ 2,102 $ 8,150 Gross Gains on Sales 3 76 Gross Losses on Sales — (81) |
Loans (Tables)
Loans (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Loans | |
Summary of components of loans | The following table presents the components of the loan portfolio at March 31, 2020 and December 31, 2019: March 31, December 31, 2020 2019 Commercial $ 299,425 $ 276,035 Construction and Land Development 183,350 196,776 Real Estate Mortgage: 1-4 Family Mortgage 272,590 260,611 Multifamily 536,380 515,014 CRE Owner Occupied 75,207 66,584 CRE Non-owner Occupied 631,541 592,545 Total Real Estate Mortgage Loans 1,515,718 1,434,754 Consumer and Other 4,324 4,473 Total Loans, Gross 2,002,817 1,912,038 Allowance for Loan Losses (24,585) (22,526) Net Deferred Loan Fees (5,336) (5,512) Total Loans, Net $ 1,972,896 $ 1,884,000 |
Summary of the activity in the allowance for loan losses by segment | The following tables present the activity in the allowance for loan losses, by segment, for the three months ended March 31, 2020 and 2019: Construction CRE CRE and Land 1-‑4 Family Owner Non‑owner Consumer Three Months Ended March 31, 2020 Commercial Development Mortgage Multifamily Occupied Occupied and Other Unallocated Total Allowance for Loan Losses: Beginning Balance $ 3,058 $ 2,202 $ 2,839 $ 5,824 $ 792 $ 6,972 $ 85 $ 754 $ 22,526 Provision for Loan Losses 531 (71) 361 732 146 1,031 18 (648) 2,100 Loans Charged-off (34) — — — — — (13) — (47) Recoveries of Loans 2 — 2 — — — 2 — 6 Total Ending Allowance Balance $ 3,557 $ 2,131 $ 3,202 $ 6,556 $ 938 $ 8,003 $ 92 $ 106 $ 24,585 Three Months Ended March 31, 2019 Allowance for Loan Losses: Beginning Balance $ 2,898 $ 2,451 $ 2,597 $ 4,644 $ 808 $ 5,872 $ 65 $ 696 $ 20,031 Provision for Loan Losses 480 (354) 5 71 (18) 477 12 (73) 600 Loans Charged-off (19) — — — — — (17) — (36) Recoveries of Loans 2 — 9 — — — 1 — 12 Total Ending Allowance Balance $ 3,361 $ 2,097 $ 2,611 $ 4,715 $ 790 $ 6,349 $ 61 $ 623 $ 20,607 The following tables present the balance in the allowance for loan losses and the recorded investment in loans, by segment, based on impairment method as of March 31, 2020 and December 31, 2019: Construction CRE CRE and Land 1-‑4 Family Owner Non‑owner Consumer Allowance for Loan Losses at March 31, 2020 Commercial Development Mortgage Multifamily Occupied Occupied and Other Unallocated Total Individually Evaluated for Impairment $ 35 $ — $ — $ — $ — $ — $ 14 $ — $ 49 Collectively Evaluated for Impairment 3,522 2,131 3,202 6,556 938 8,003 78 106 24,536 Totals $ 3,557 $ 2,131 $ 3,202 $ 6,556 $ 938 $ 8,003 $ 92 $ 106 $ 24,585 Allowance for Loan Losses at December 31, 2019 Individually Evaluated for Impairment $ 31 $ — $ — $ — $ — $ — $ 14 $ — $ 45 Collectively Evaluated for Impairment 3,027 2,202 2,839 5,824 792 6,972 71 754 22,481 Totals $ 3,058 $ 2,202 $ 2,839 $ 5,824 $ 792 $ 6,972 $ 85 $ 754 $ 22,526 Construction CRE CRE and Land 1-‑4 Family Owner Non‑owner Consumer Loans at March 31, 2020 Commercial Development Mortgage Multifamily Occupied Occupied and Other Total Individually Evaluated for Impairment $ 267 $ 170 $ 1,243 $ — $ 1,847 $ 224 $ 14 $ 3,765 Collectively Evaluated for Impairment 299,158 183,180 271,347 536,380 73,360 631,317 4,310 1,999,052 Totals $ 299,425 $ 183,350 $ 272,590 $ 536,380 $ 75,207 $ 631,541 $ 4,324 $ 2,002,817 Loans at December 31, 2019 Individually Evaluated for Impairment $ 273 $ 176 $ 1,059 $ — $ 236 $ — $ 14 $ 1,758 Collectively Evaluated for Impairment 275,762 196,600 259,552 515,014 66,348 592,545 4,459 1,910,280 Totals $ 276,035 $ 196,776 $ 260,611 $ 515,014 $ 66,584 $ 592,545 $ 4,473 $ 1,912,038 |
Summary of impaired loans by loan segment | The following table presents information regarding total carrying amounts and total unpaid principal balances of impaired loans by loan segment as of March 31, 2020 and December 31, 2019: March 31, 2020 December 31, 2019 Recorded Principal Related Recorded Principal Related Investment Balance Allowance Investment Balance Allowance Loans With No Related Allowance for Loan Losses: Commercial $ 157 $ 157 $ — $ 167 $ 167 $ — Construction and Land Development 170 779 — 176 785 — Real Estate Mortgage: HELOC and 1-4 Family Junior Mortgage 303 490 — 302 489 — 1st REM - Rentals 940 940 — 757 757 — CRE Owner Occupied 1,847 1,847 — 236 236 — CRE Non Owner Occupied 224 224 — — — — Totals 3,641 4,437 — 1,638 2,434 — Loans With An Allowance for Loan Losses: Commercial 110 113 35 106 109 31 Consumer and Other 14 14 14 14 14 14 Totals 124 127 49 120 123 45 Grand Totals $ 3,765 $ 4,564 $ 49 $ 1,758 $ 2,557 $ 45 The following table presents information regarding the average balances and interest income recognized on impaired loans by loan segment for the three months ended March 31, 2020 and 2019: Three Months Ended March 31, 2020 2019 Average Interest Average Interest Investment Recognized Investment Recognized Loans With No Related Allowance for Loan Losses: Commercial $ 163 $ 3 $ — $ — Construction and Land Development 175 — 198 — Real Estate Mortgage: HELOC and 1-4 Family Junior Mortgage 329 — 157 2 1st REM - Rentals 932 11 1,637 9 CRE Owner Occupied 1,837 25 449 6 CRE Non Owner Occupied 225 3 — — Consumer and Other — — 57 — Totals 3,661 42 2,498 17 Loans With An Allowance for Loan Losses: Commercial 111 — 688 9 Real Estate Mortgage: HELOC and 1-4 Family Junior Mortgage — — 308 — Consumer and Other 14 — — — 125 — 996 9 Grand Totals $ 3,786 $ 42 $ 3,494 $ 26 |
Summary of risk category of loans by loan segment, based on the most recent analysis performed by management | The following tables present the risk category of loans by loan segment as of March 31, 2020 and December 31, 2019, based on the most recent analysis performed by management: March 31, 2020 Pass Watch Substandard Total Commercial $ 277,533 $ 21,625 $ 267 $ 299,425 Construction and Land Development 183,045 135 170 183,350 Real Estate Mortgage: HELOC and 1-4 Family Junior Mortgage 30,790 138 — 30,928 1st REM - 1-4 Family 34,253 123 176 34,552 LOCs and 2nd REM - Rentals 19,156 476 303 19,935 1st REM - Rentals 185,643 768 764 187,175 Multifamily 536,380 — — 536,380 CRE Owner Occupied 72,540 820 1,847 75,207 CRE Non-owner Occupied 609,598 21,719 224 631,541 Consumer and Other 4,310 — 14 4,324 Totals $ 1,953,248 $ 45,804 $ 3,765 $ 2,002,817 December 31, 2019 Pass Watch Substandard Total Commercial $ 275,741 $ 21 $ 273 $ 276,035 Construction and Land Development 196,462 138 176 196,776 Real Estate Mortgage: HELOC and 1-4 Family Junior Mortgage 28,483 138 — 28,621 1st REM - 1-4 Family 36,370 124 177 36,671 LOCs and 2nd REM - Rentals 17,890 479 302 18,671 1st REM - Rentals 174,781 1,287 580 176,648 Multifamily 515,014 — — 515,014 CRE Owner Occupied 65,411 — 1,173 66,584 CRE Non-owner Occupied 589,457 3,088 — 592,545 Consumer and Other 4,459 — 14 4,473 Totals $ 1,904,068 $ 5,275 $ 2,695 $ 1,912,038 |
Summary of aging of the recorded investment in past due loans by loan segment | The following tables present the aging of the recorded investment in past due loans by loan segment as of March 31, 2020 and December 31, 2019: Accruing Interest 30-89 Days 90 Days or March 31, 2020 Current Past Due More Past Due Nonaccrual Total Commercial $ 299,397 $ 21 $ — $ 7 $ 299,425 Construction and Land Development 183,180 — — 170 183,350 Real Estate Mortgage: HELOC and 1-4 Family Junior Mortgage 30,928 — — — 30,928 1st REM - 1-4 Family 34,552 — — — 34,552 LOCs and 2nd REM - Rentals 19,632 — — 303 19,935 1st REM - Rentals 187,049 — — 126 187,175 Multifamily 536,380 — — — 536,380 CRE Owner Occupied 75,207 — — — 75,207 CRE Non-owner Occupied 631,541 — — — 631,541 Consumer and Other 4,324 — — — 4,324 Totals $ 2,002,190 $ 21 $ — $ 606 $ 2,002,817 Accruing Interest 30-89 Days 90 Days or December 31, 2019 Current Past Due More Past Due Nonaccrual Total Commercial $ 276,028 $ — $ — $ 7 $ 276,035 Construction and Land Development 196,600 — — 176 196,776 Real Estate Mortgage: HELOC and 1-4 Family Junior Mortgage 28,621 — — — 28,621 1st REM - 1-4 Family 36,671 — — — 36,671 LOCs and 2nd REM - Rentals 18,527 — — 144 18,671 1st REM - Rentals 176,114 400 — 134 176,648 Multifamily 515,014 — — — 515,014 CRE Owner Occupied 66,584 — — — 66,584 CRE Non-owner Occupied 592,545 — — — 592,545 Consumer and Other 4,470 3 — — 4,473 Totals $ 1,911,174 $ 403 $ — $ 461 $ 1,912,038 |
Premises and Equipment (Tables)
Premises and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Premises and Equipment | |
Schedule of Premises and equipment | Premises and equipment are summarized as follows as of March 31, 2020 and December 31, 2019: Range of March 31, December 31, Useful Lives 2020 2019 Land N/A $ $ Building 15 - 39 Years Leasehold Improvements 3 ‑ 10 Years Furniture and Equipment 3 ‑ 5 Years Construction in Progress N/A Subtotal Accumulated Depreciation Totals $ $ |
Deposits (Tables)
Deposits (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Deposits. | |
Schedule of composition of deposits | The following table presents the composition of deposits at March 31, 2020 and December 31, 2019: March 31, December 31, 2020 2019 Transaction Deposits $ 731,700 $ 712,136 Savings and Money Market Deposits 514,113 516,785 Time Deposits 393,340 360,027 Brokered Deposits 260,974 234,362 Totals $ 1,900,127 $ 1,823,310 |
Derivative Instruments and He_2
Derivative Instruments and Hedging Activities (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Summary of interest rate swaps | The following table presents a summary of the Company’s interest rate swaps to facilitate customer transactions as of March 31, 2020 and December 31, 2019: March 31, 2020 December 31, 2019 Notional Estimated Notional Estimated Amount Fair Value Amount Fair Value Interest Rate Swap Agreements: Assets $ 50,113 $ 3,254 $ 7,140 $ 150 Liabilities 50,113 (3,254) 7,140 (150) Total $ 100,226 $ — $ 14,280 $ — |
Derivative Instruments and Hedging Activities | The following tables present a summary of the Company’s interest rate swaps designated as cash flow hedges as of March 31, 2020 and December 31, 2019: March 31, 2020 December 31, 2019 Notional Amount $ 102,500 $ 48,000 Weighted Average Pay Rate 1.35 % 1.89 % Weighted Average Receive Rate 1.51 % 2.25 % Weighted Average Maturity (Years) 4.48 3.53 Net Unrealized Gain (Loss) $ (3,533) $ (618) |
Effect of derivative instruments in cash flow hedging relationships | The following table presents the effect of derivative instruments in cash flow hedging relationships on the consolidated statements of income for the three months ended March 31, 2020 and 2019: Three Months Ended March 31, (dollars in thousands) 2020 2019 Derivatives in Location of Gain or Gain (Loss) Cash Flow Hedging (Loss) Reclassified Reclassified from Relationships from AOCI into Income AOCI into Earnings Interest Rate Swaps Interest Expense $ (18) $ — |
Cash flow hedge | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Summary of interest rate swaps | March 31, 2020 December 31, 2019 Notional Estimated Notional Estimated Amount Fair Value Amount Fair Value Interest Rate Swap Agreements: Assets $ — $ — $ 18,000 $ 134 Liabilities 102,500 (3,533) 30,000 (752) |
Tax Credit Investments (Tables)
Tax Credit Investments (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Tax Credit Investments | |
Summary of investments in qualified affordable housing projects and other tax credit investments | The following table presents the Company’s investments in qualified affordable housing projects and other tax credit investments at March 31, 2020 and December 31, 2019: March 31, 2020 December 31, 2019 Investment Accounting Method Investment Unfunded Commitment (1) Investment Unfunded Commitment Low Income Housing Tax Credit (LIHTC) Proportional Amortization $ 2,077 $ — $ 2,148 $ — Federal Historic Tax Credit (FHTC) Equity 1,924 2,895 2,262 3,395 Total $ 4,001 $ 2,895 $ 4,410 $ 3,395 (1) All commitments are expected to be paid by the Company by March 31, 2021. |
Schedule of amortization expense and tax benefit for qualified affordable housing projects and other tax credit investments | The following table presents the amortization expense and tax benefit recognized for the Company’s qualified affordable housing projects and other tax credit investments for the three months ended March 31, 2020 and 2019: Three Months Ended March 31, 2020 2019 Amortization Expense (1) LIHTC $ 71 $ 72 FHTC 85 177 Total $ 156 $ 249 Tax Benefit Recognized (2) LIHTC $ (83) $ (83) FHTC (170) (214) Total $ (253) $ (297) (1) The amortization expense for the LIHTC investments are included in income tax expense. The amortization for the FHTC tax credits are included in noninterest expense. All of the tax benefits recognized are included in income tax expense. The tax benefit recognized for the FHTC investments primarily reflects the tax credits generated from the investments, and excludes the net tax expense/benefit of the investments’ income/loss. |
Commitments, Contingencies an_2
Commitments, Contingencies and Credit Risk (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Commitments, Contingencies and Credit Risk | |
Schedule of commitments outstanding | The following commitments were outstanding at March 31, 2020 and December 31, 2019: March 31, December 31, 2020 2019 Unfunded Commitments Under Lines of Credit $ 469,221 $ 500,962 Letters of Credit 73,364 79,225 Totals $ 542,585 $ 580,187 |
Stock Options and Restricted _2
Stock Options and Restricted Stock Awards (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Stock Options and Restricted Stock Awards | |
Summary of valuation assumptions used to determine the fair value of option award | The weighted average assumptions used in the model for valuing stock option grants for the three months ended March 31, 2020, are as follows: March 31, 2020 Dividend Yield — % Expected Life 7 Years Expected Volatility 19.56 % Risk-Free Interest Rate 0.97 % |
Summary of the status of the Company’s outstanding stock options | The following table presents a summary of the status of the Company’s stock option grants for the three months ended March 31, 2020: March 31, 2020 Weighted Average Shares Exercise Price Outstanding at Beginning of Year 1,961,650 $ 7.08 Granted 25,000 12.67 Exercised — — Forfeitures — — Outstanding at Period End 1,986,650 $ 7.15 Options Exercisable at Period End 1,004,050 $ 5.01 |
Summary of information pertaining to options outstanding based on range of exercise price | The following table presents information pertaining to options outstanding at March 31, 2020: Options Outstanding Options Exercisable Number Remaining Number Exercise Price Outstanding Contractual Life Exercise Price Outstanding $ 2.13 74,750 3.0 Years $ 2.13 74,750 3.00 455,000 3.8 Years 3.00 455,000 3.58 45,000 4.8 Years 3.58 45,000 7.47 1,023,900 7.5 Years 7.47 402,300 13.22 25,000 8.1 Years 13.22 5,000 12.86 45,000 8.4 Years 12.86 9,000 12.94 30,000 8.5 Years 12.94 6,000 11.59 25,000 8.6 Years 11.59 5,000 11.15 10,000 8.9 Years 11.15 2,000 11.13 50,000 9.4 Years 11.13 — 12.92 178,000 9.7 Years 12.92 — 12.67 25,000 9.9 Years 12.67 — Totals 1,986,650 6.8 Years $ 7.15 1,004,050 |
Summary of analysis of nonvested options to purchase shares of the Company’s stock issued and outstanding | The following presents an analysis of nonvested stock options issued and outstanding for the three months ended March 31, 2020: Weighted Number of Average Grant Shares Date Fair Value Nonvested Options at December 31, 2019 969,600 $ 3.08 Granted 25,000 2.94 Vested (12,000) 1.99 Forfeited — — Nonvested Options at March 31, 2020 982,600 $ 3.09 |
Summary of the status of the Company’s outstanding restricted stock awards | The following table presents an analysis of nonvested restricted stock awards outstanding for the three months ended March 31, 2020: Weighted Number of Average Grant Shares Date Fair Value Nonvested Awards at December 31, 2019 132,960 $ 12.92 Granted 3,946 12.67 Vested — — Forfeited — — Nonvested Awards at March 31, 2020 136,906 $ 12.91 |
Regulatory Capital (Tables)
Regulatory Capital (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Regulatory Capital | |
Summary of company and the Bank’s capital amounts and ratios | The following tables present the Company and the Bank’s capital amounts and ratios as of March 31, 2020 and December 31, 2019: Minimum Required For Capital Adequacy To be Well Capitalized For Capital Adequacy Purposes Plus Capital Under Prompt Corrective Actual Purposes Conservation Buffer Action Regulations March 31, 2020 Amount Ratio Amount Ratio Amount Ratio Amount Ratio (dollars in thousands) Company (Consolidated): Total Risk-Based Capital $ 292,080 13.38 % $ 174,641 8.00 % $ 229,216 10.50 % N/A N/A Tier 1 Risk-Based Capital 242,376 11.10 130,980 6.00 185,556 8.50 N/A N/A Common Equity Tier 1 Capital 242,376 11.10 98,235 4.50 152,810 7.00 N/A N/A Tier 1 Leverage Ratio 242,376 10.51 92,259 4.00 92,259 4.00 N/A N/A Bank: Total Risk-Based Capital $ 276,487 12.67 % $ 174,523 8.00 % $ 229,062 10.50 % $ 218,154 10.00 % Tier 1 Risk-Based Capital 251,542 11.53 130,893 6.00 185,431 8.50 174,523 8.00 Common Equity Tier 1 Capital 251,542 11.53 98,169 4.50 152,708 7.00 141,800 6.50 Tier 1 Leverage Ratio 251,542 10.93 92,088 4.00 92,088 4.00 115,110 5.00 Minimum Required For Capital Adequacy To be Well Capitalized For Capital Adequacy Purposes Plus Capital Under Prompt Corrective Actual Purposes Conservation Buffer Action Regulations December 31, 2019 Amount Ratio Amount Ratio Amount Ratio Amount Ratio (dollars in thousands) Company (Consolidated): Total Risk-Based Capital $ 269,613 12.98 % $ 166,163 8.00 % $ 218,089 10.50 % N/A N/A Tier 1 Risk-Based Capital 236,533 11.39 124,623 6.00 176,549 8.50 N/A N/A Common Equity Tier 1 Capital 236,533 11.39 93,467 4.50 145,393 7.00 N/A N/A Tier 1 Leverage Ratio 236,533 10.69 88,498 4.00 88,498 4.00 N/A N/A Bank: Total Risk-Based Capital $ 252,501 12.16 % $ 166,137 8.00 % $ 218,055 10.50 % $ 207,671 10.00 % Tier 1 Risk-Based Capital 243,461 11.72 124,603 6.00 176,521 8.50 166,137 8.00 Common Equity Tier 1 Capital 243,461 11.72 93,452 4.50 145,370 7.00 134,986 6.50 Tier 1 Leverage Ratio 243,461 11.01 88,455 4.00 88,455 4.00 110,569 5.00 |
Fair Value Measurement (Tables)
Fair Value Measurement (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Measurement | |
Summary of balances of the assets and liabilities measured at fair value on a recurring basis | The following tables present the balances of the assets and liabilities measured at fair value on a recurring basis as of March 31, 2020 and December 31, 2019: March 31, 2020 Level 1 Level 2 Level 3 Total Fair Value of Financial Assets: Securities Available for Sale: Municipal Bonds $ — $ 122,232 $ — $ 122,232 Mortgage-Backed Securities — 62,793 — 62,793 Corporate Securities — 49,940 — 49,940 SBA Securities — 46,592 — 46,592 Asset-Backed Securities — 25,760 — 25,760 Interest Rate Swaps — 3,254 — 3,254 Total Fair Value of Financial Assets $ — $ 310,571 $ — $ 310,571 Fair Value of Financial Liabilities: Interest Rate Swaps $ — $ 6,787 $ — $ 6,787 Total Fair Value of Financial Liabilities $ — $ 6,787 $ — $ 6,787 December 31, 2019 Level 1 Level 2 Level 3 Total Fair Value of Financial Assets: Securities Available for Sale: U.S. Treasury Securities $ 4,998 $ — $ — $ 4,998 Municipal Bonds — 105,743 — 105,743 Mortgage-Backed Securities — 64,728 — 64,728 Corporate Securities — 50,176 — 50,176 SBA Securities — 49,559 — 49,559 Asset-Backed Securities — 14,673 — 14,673 Interest Rate Swaps — 284 — 284 Total Fair Value of Financial Assets $ 4,998 $ 285,163 $ — $ 290,161 Fair Value of Financial Liabilities: Interest Rate Swaps $ — $ 902 $ — $ 902 Total Fair Value of Financial Liabilities $ — $ 902 $ — $ 902 |
Summary of net impairment losses related to nonrecurring fair value measurements of certain asset | The following tables present net impairment losses related to nonrecurring fair value measurements of certain assets at March 31, 2020 and December 31, 2019: March 31, 2020 Level 1 Level 2 Level 3 Loss Impaired Loans $ — $ 75 $ — $ 49 Totals $ — $ 75 $ — $ 49 December 31, 2019 Level 1 Level 2 Level 3 Loss Impaired Loans $ — $ 75 $ — $ 206 Totals $ — $ 75 $ — $ 206 |
Summary of carrying amount and estimated fair values of financial instruments | The following tables present the carrying amount and estimated fair values of financial instruments at March 31, 2020 and December 31, 2019: March 31, 2020 Fair Value Hierarchy Carrying Estimated Amount Level 1 Level 2 Level 3 Fair Value Financial Assets: Cash and Due From Banks $ 61,526 $ 61,526 $ — $ — $ 61,526 Bank-Owned Certificates of Deposit 2,895 — 2,968 — 2,968 Securities Available for Sale 307,317 — 307,317 — 307,317 FHLB Stock, at Cost 11,017 — 11,017 — 11,017 Loans, Net 1,972,896 — 1,989,365 — 1,989,365 Accrued Interest Receivable 7,102 — 7,102 — 7,102 Interest Rate Swaps 3,254 — 3,254 — 3,254 Financial Liabilities: Deposits $ 1,900,127 $ — $ 1,912,436 $ — $ 1,912,436 Notes Payable 12,500 — 12,525 — 12,525 FHLB Advances 207,500 — 218,362 — 218,362 Subordinated Debentures 24,759 — 26,630 — 26,630 Accrued Interest Payable 1,688 — 1,688 — 1,688 Interest Rate Swaps 6,787 — 6,787 — 6,787 December 31, 2019 Fair Value Hierarchy Carrying Estimated Amount Level 1 Level 2 Level 3 Fair Value Financial Assets: Cash and Due From Banks $ 31,935 $ 31,935 $ — $ — $ 31,935 Bank-Owned Certificates of Deposit 2,654 — 2,677 — 2,677 Securities Available for Sale 289,877 4,998 284,879 — 289,877 FHLB Stock, at Cost 7,824 — 7,824 — 7,824 Loans, Net 1,884,000 — 1,891,987 — 1,891,987 Accrued Interest Receivable 6,775 — 6,775 — 6,775 Interest Rate Swaps 284 — 284 — 284 Financial Liabilities: Deposits $ 1,823,310 $ — $ 1,821,915 $ — $ 1,821,915 Notes Payable 13,000 — 13,022 — 13,022 FHLB Advances 136,500 — 141,152 — 141,152 Subordinated Debentures 24,733 — 25,309 — 25,309 Accrued Interest Payable 1,982 — 1,982 — 1,982 Interest Rate Swaps 902 — 902 — 902 |
Description of the Business a_3
Description of the Business and Summary of Significant Accounting Policies (Details) | Mar. 31, 2020 |
Description of the Business and Summary of Significant Accounting Policies | |
Loans with LIBOR index rate (as a percent) | 10.70% |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Net Income Available to Common Shareholders | $ 7,443 | $ 7,018 |
Weighted Average Common Stock Outstanding: | ||
Weighted Average Common Stock Outstanding (Basic) | 28,791,494 | 30,097,638 |
Dilutive Effect of Stock Compensation | 710,751 | 609,098 |
Weighted Average Common Stock Outstanding (Dilutive) | 29,502,245 | 30,706,736 |
Basic Earnings per Common Share (in dollars per share) | $ 0.26 | $ 0.23 |
Diluted Earnings per Common Share (in dollars per share) | $ 0.25 | $ 0.23 |
Stock Options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti dilutive securities excluded from the calculation of EPS | 3,030,000 | 135,000 |
Restricted Stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti dilutive securities excluded from the calculation of EPS | 3,946 |
Securities - Securities Availab
Securities - Securities Available for Sale (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
The amortized cost and estimated fair value of securities with gross unrealized gains and losses | ||
Amortized Cost | $ 300,837 | $ 283,216 |
Gross Unrealized Gains | 10,061 | 7,711 |
Gross Unrealized Losses | (3,581) | (1,050) |
Fair Value | 307,317 | 289,877 |
U.S. Treasury Securities | ||
The amortized cost and estimated fair value of securities with gross unrealized gains and losses | ||
Amortized Cost | 4,990 | |
Gross Unrealized Gains | 8 | |
Fair Value | 4,998 | |
Municipal Bonds | ||
The amortized cost and estimated fair value of securities with gross unrealized gains and losses | ||
Amortized Cost | 115,331 | 99,441 |
Gross Unrealized Gains | 7,897 | 6,338 |
Gross Unrealized Losses | (996) | (36) |
Fair Value | 122,232 | 105,743 |
Mortgage-Backed Securities | ||
The amortized cost and estimated fair value of securities with gross unrealized gains and losses | ||
Amortized Cost | 62,405 | 64,312 |
Gross Unrealized Gains | 1,099 | 697 |
Gross Unrealized Losses | (711) | (281) |
Fair Value | 62,793 | 64,728 |
Corporate Securities | ||
The amortized cost and estimated fair value of securities with gross unrealized gains and losses | ||
Amortized Cost | 49,079 | 49,674 |
Gross Unrealized Gains | 1,021 | 633 |
Gross Unrealized Losses | (160) | (131) |
Fair Value | 49,940 | 50,176 |
SBA Securities | ||
The amortized cost and estimated fair value of securities with gross unrealized gains and losses | ||
Amortized Cost | 47,107 | 50,126 |
Gross Unrealized Gains | 35 | 35 |
Gross Unrealized Losses | (550) | (602) |
Fair Value | 46,592 | 49,559 |
Asset-Backed Securities | ||
The amortized cost and estimated fair value of securities with gross unrealized gains and losses | ||
Amortized Cost | 26,915 | 14,673 |
Gross Unrealized Gains | 9 | |
Gross Unrealized Losses | (1,164) | |
Fair Value | $ 25,760 | $ 14,673 |
Securities - Continuous Unreali
Securities - Continuous Unrealized Loss Position (Details) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020USD ($)security | Dec. 31, 2019USD ($)security | |
Fair value and gross unrealized losses of securities with unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position | ||
Less Than 12 Months, Fair Value | $ 84,481 | $ 55,293 |
Less Than 12 Months, Unrealized Losses | (3,110) | (460) |
12 Months or Greater, Fair Value | 30,922 | 35,524 |
12 Months or Greater, Unrealized Losses | (471) | (590) |
Fair Value | 115,403 | 90,817 |
Unrealized Losses | $ (3,581) | $ (1,050) |
Number of debt securities with unrealized losses | security | 152 | 110 |
Percentage of aggregate depreciation from amortized cost basis | 3.00% | 1.10% |
Municipal Bonds | ||
Fair value and gross unrealized losses of securities with unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position | ||
Less Than 12 Months, Fair Value | $ 19,372 | $ 2,760 |
Less Than 12 Months, Unrealized Losses | (989) | (23) |
12 Months or Greater, Fair Value | 223 | 1,390 |
12 Months or Greater, Unrealized Losses | (7) | (13) |
Fair Value | 19,595 | 4,150 |
Unrealized Losses | (996) | (36) |
Mortgage-Backed Securities | ||
Fair value and gross unrealized losses of securities with unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position | ||
Less Than 12 Months, Fair Value | 28,935 | 32,276 |
Less Than 12 Months, Unrealized Losses | (684) | (242) |
12 Months or Greater, Fair Value | 1,791 | 3,098 |
12 Months or Greater, Unrealized Losses | (27) | (39) |
Fair Value | 30,726 | 35,374 |
Unrealized Losses | (711) | (281) |
Corporate Securities | ||
Fair value and gross unrealized losses of securities with unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position | ||
Less Than 12 Months, Fair Value | 10,298 | 8,350 |
Less Than 12 Months, Unrealized Losses | (160) | (131) |
Fair Value | 10,298 | 8,350 |
Unrealized Losses | (160) | (131) |
SBA Securities | ||
Fair value and gross unrealized losses of securities with unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position | ||
Less Than 12 Months, Fair Value | 9,191 | 11,907 |
Less Than 12 Months, Unrealized Losses | (113) | (64) |
12 Months or Greater, Fair Value | 28,908 | 31,036 |
12 Months or Greater, Unrealized Losses | (437) | (538) |
Fair Value | 38,099 | 42,943 |
Unrealized Losses | (550) | $ (602) |
Asset-Backed Securities | ||
Fair value and gross unrealized losses of securities with unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position | ||
Less Than 12 Months, Fair Value | 16,685 | |
Less Than 12 Months, Unrealized Losses | (1,164) | |
Fair Value | 16,685 | |
Unrealized Losses | $ (1,164) |
Securities - Contractual Maturi
Securities - Contractual Maturities (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Contractual maturities, amortized cost | ||
Due in One Year or Less | $ 9,793 | |
Due After One Year Through Five Years | 59,106 | |
Due After Five Years Through 10 Years | 80,222 | |
Due After 10 Years | 15,289 | |
Subtotal | 164,410 | |
Totals | 300,837 | $ 283,216 |
Contractual maturities, fair value | ||
Due in One Year or Less | 9,926 | |
Due After One Year Through Five Years | 60,660 | |
Due After Five Years Through 10 Years | 84,592 | |
Due After 10 Years | 16,994 | |
Subtotal | 172,172 | |
Totals | 307,317 | 289,877 |
Mortgage-Backed Securities | ||
Contractual maturities, amortized cost | ||
Totals | 62,405 | 64,312 |
Contractual maturities, fair value | ||
Totals | 62,793 | 64,728 |
SBA Securities | ||
Contractual maturities, amortized cost | ||
Totals | 47,107 | 50,126 |
Contractual maturities, fair value | ||
Totals | 46,592 | 49,559 |
Asset-Backed Securities | ||
Contractual maturities, amortized cost | ||
Totals | 26,915 | 14,673 |
Contractual maturities, fair value | ||
Totals | $ 25,760 | $ 14,673 |
Securities - Available for Sale
Securities - Available for Sale Securities Gross Realized Gain Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Summary of the proceeds from sales of securities available for sale, as well as gross gains and losses | ||
Proceeds From Sales of Securities | $ 2,102 | $ 8,150 |
Gross Gains on Sales | $ 3 | 76 |
Gross Losses on Sales | $ (81) |
Loans - Components of loans (De
Loans - Components of loans (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
Components of loans | ||||
Total Loans, Gross | $ 2,002,817 | $ 1,912,038 | ||
Allowance for Loan Losses | (24,585) | (22,526) | $ (20,607) | $ (20,031) |
Net Deferred Loan Fees | (5,336) | (5,512) | ||
Total Loans, Net | 1,972,896 | 1,884,000 | ||
Commercial | ||||
Components of loans | ||||
Total Loans, Gross | 299,425 | 276,035 | ||
Allowance for Loan Losses | (3,557) | (3,058) | (3,361) | (2,898) |
Construction and Land Development | ||||
Components of loans | ||||
Total Loans, Gross | 183,350 | 196,776 | ||
Allowance for Loan Losses | (2,131) | (2,202) | (2,097) | (2,451) |
Real Estate Mortgage | ||||
Components of loans | ||||
Total Loans, Gross | 1,515,718 | 1,434,754 | ||
1-4 Family Mortgage | ||||
Components of loans | ||||
Total Loans, Gross | 272,590 | 260,611 | ||
Allowance for Loan Losses | (3,202) | (2,839) | (2,611) | (2,597) |
Multifamily | ||||
Components of loans | ||||
Total Loans, Gross | 536,380 | 515,014 | ||
Allowance for Loan Losses | (6,556) | (5,824) | (4,715) | (4,644) |
CRE Owner Occupied | ||||
Components of loans | ||||
Total Loans, Gross | 75,207 | 66,584 | ||
Allowance for Loan Losses | (938) | (792) | (790) | (808) |
CRE Non-owner Occupied | ||||
Components of loans | ||||
Total Loans, Gross | 631,541 | 592,545 | ||
Allowance for Loan Losses | (8,003) | (6,972) | (6,349) | (5,872) |
Consumer and other | ||||
Components of loans | ||||
Total Loans, Gross | 4,324 | 4,473 | ||
Allowance for Loan Losses | $ (92) | $ (85) | $ (61) | $ (65) |
Loans - Allowance for loan loss
Loans - Allowance for loan losses by segment (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | Mar. 31, 2020 | Dec. 31, 2019 | |
Allowance for Loan Losses: | |||||
Beginning Balance | $ 22,526 | $ 20,031 | $ 20,031 | ||
Provision for Loan Losses | 2,100 | 600 | |||
Loans Charged-off | (47) | (36) | |||
Recoveries of Loans | 6 | 12 | |||
Total Ending Allowance Balance | 24,585 | 20,607 | 22,526 | ||
Allowance for loan losses and the recorded investment | |||||
Allowance for Loan Losses and Loans, Individually Evaluated for Impairment | $ 49 | $ 45 | |||
Allowance for Loan Losses and Loans, Collectively Evaluated for Impairment | 24,536 | 22,481 | |||
Loans and Leases Receivable, Allowance, Total | 24,585 | 20,607 | 22,526 | 24,585 | 22,526 |
Loans, Individually Evaluated for Impairment | 3,765 | 1,758 | |||
Loans, Collectively Evaluated for Impairment | 1,999,052 | 1,910,280 | |||
Totals | 2,002,817 | 1,912,038 | |||
Commercial | |||||
Allowance for Loan Losses: | |||||
Beginning Balance | 3,058 | 2,898 | 2,898 | ||
Provision for Loan Losses | 531 | 480 | |||
Loans Charged-off | (34) | (19) | |||
Recoveries of Loans | 2 | 2 | |||
Total Ending Allowance Balance | 3,557 | 3,361 | 3,058 | ||
Allowance for loan losses and the recorded investment | |||||
Allowance for Loan Losses and Loans, Individually Evaluated for Impairment | 35 | 31 | |||
Allowance for Loan Losses and Loans, Collectively Evaluated for Impairment | 3,522 | 3,027 | |||
Loans and Leases Receivable, Allowance, Total | 3,557 | 3,361 | 3,058 | 3,557 | 3,058 |
Loans, Individually Evaluated for Impairment | 267 | 273 | |||
Loans, Collectively Evaluated for Impairment | 299,158 | 275,762 | |||
Totals | 299,425 | 276,035 | |||
Construction and Land Development | |||||
Allowance for Loan Losses: | |||||
Beginning Balance | 2,202 | 2,451 | 2,451 | ||
Provision for Loan Losses | (71) | (354) | |||
Total Ending Allowance Balance | 2,131 | 2,097 | 2,202 | ||
Allowance for loan losses and the recorded investment | |||||
Allowance for Loan Losses and Loans, Collectively Evaluated for Impairment | 2,131 | 2,202 | |||
Loans and Leases Receivable, Allowance, Total | 2,131 | 2,097 | 2,202 | 2,131 | 2,202 |
Loans, Individually Evaluated for Impairment | 170 | 176 | |||
Loans, Collectively Evaluated for Impairment | 183,180 | 196,600 | |||
Totals | 183,350 | 196,776 | |||
1-4 Family Mortgage | |||||
Allowance for Loan Losses: | |||||
Beginning Balance | 2,839 | 2,597 | 2,597 | ||
Provision for Loan Losses | 361 | 5 | |||
Recoveries of Loans | 2 | 9 | |||
Total Ending Allowance Balance | 3,202 | 2,611 | 2,839 | ||
Allowance for loan losses and the recorded investment | |||||
Allowance for Loan Losses and Loans, Collectively Evaluated for Impairment | 3,202 | 2,839 | |||
Loans and Leases Receivable, Allowance, Total | 3,202 | 2,611 | 2,839 | 3,202 | 2,839 |
Loans, Individually Evaluated for Impairment | 1,243 | 1,059 | |||
Loans, Collectively Evaluated for Impairment | 271,347 | 259,552 | |||
Totals | 272,590 | 260,611 | |||
Multifamily | |||||
Allowance for Loan Losses: | |||||
Beginning Balance | 5,824 | 4,644 | 4,644 | ||
Provision for Loan Losses | 732 | 71 | |||
Total Ending Allowance Balance | 6,556 | 4,715 | 5,824 | ||
Allowance for loan losses and the recorded investment | |||||
Allowance for Loan Losses and Loans, Collectively Evaluated for Impairment | 6,556 | 5,824 | |||
Loans and Leases Receivable, Allowance, Total | 6,556 | 4,715 | 5,824 | 6,556 | 5,824 |
Loans, Collectively Evaluated for Impairment | 536,380 | 515,014 | |||
Totals | 536,380 | 515,014 | |||
CRE Owner Occupied | |||||
Allowance for Loan Losses: | |||||
Beginning Balance | 792 | 808 | 808 | ||
Provision for Loan Losses | 146 | (18) | |||
Total Ending Allowance Balance | 938 | 790 | 792 | ||
Allowance for loan losses and the recorded investment | |||||
Allowance for Loan Losses and Loans, Collectively Evaluated for Impairment | 938 | 792 | |||
Loans and Leases Receivable, Allowance, Total | 938 | 790 | 792 | 938 | 792 |
Loans, Individually Evaluated for Impairment | 1,847 | 236 | |||
Loans, Collectively Evaluated for Impairment | 73,360 | 66,348 | |||
Totals | 75,207 | 66,584 | |||
CRE Non-owner Occupied | |||||
Allowance for Loan Losses: | |||||
Beginning Balance | 6,972 | 5,872 | 5,872 | ||
Provision for Loan Losses | 1,031 | 477 | |||
Total Ending Allowance Balance | 8,003 | 6,349 | 6,972 | ||
Allowance for loan losses and the recorded investment | |||||
Allowance for Loan Losses and Loans, Collectively Evaluated for Impairment | 8,003 | 6,972 | |||
Loans and Leases Receivable, Allowance, Total | 8,003 | 6,349 | 6,972 | 8,003 | 6,972 |
Loans, Individually Evaluated for Impairment | 224 | ||||
Loans, Collectively Evaluated for Impairment | 631,317 | 592,545 | |||
Totals | 631,541 | 592,545 | |||
Consumer and other | |||||
Allowance for Loan Losses: | |||||
Beginning Balance | 85 | 65 | 65 | ||
Provision for Loan Losses | 18 | 12 | |||
Loans Charged-off | (13) | (17) | |||
Recoveries of Loans | 2 | 1 | |||
Total Ending Allowance Balance | 92 | 61 | 85 | ||
Allowance for loan losses and the recorded investment | |||||
Allowance for Loan Losses and Loans, Individually Evaluated for Impairment | 14 | 14 | |||
Allowance for Loan Losses and Loans, Collectively Evaluated for Impairment | 78 | 71 | |||
Loans and Leases Receivable, Allowance, Total | 92 | 61 | 85 | 92 | 85 |
Loans, Individually Evaluated for Impairment | 14 | 14 | |||
Loans, Collectively Evaluated for Impairment | 4,310 | 4,459 | |||
Totals | 4,324 | 4,473 | |||
Unallocated | |||||
Allowance for Loan Losses: | |||||
Beginning Balance | 754 | 696 | 696 | ||
Provision for Loan Losses | (648) | (73) | |||
Total Ending Allowance Balance | 106 | 623 | 754 | ||
Allowance for loan losses and the recorded investment | |||||
Allowance for Loan Losses and Loans, Collectively Evaluated for Impairment | 106 | 754 | |||
Loans and Leases Receivable, Allowance, Total | $ 106 | $ 623 | $ 754 | $ 106 | $ 754 |
Loans - Impaired loans by loan
Loans - Impaired loans by loan segment (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Impaired loans by loan segment | ||
Loans With No Related Allowance for Loan Losses, Recorded Investment | $ 3,641 | $ 1,638 |
Loans With No Related Allowance for Loan Losses, Principal Balance | 4,437 | 2,434 |
Loans With An Allowance for Loan Losses, Recorded Investment | 124 | 120 |
Loans With An Allowance for Loan Losses, Principal Balance | 127 | 123 |
Total Recorded Investment | 3,765 | 1,758 |
Total Principal Balance | 4,564 | 2,557 |
Related Allowance | 49 | 45 |
Commercial | ||
Impaired loans by loan segment | ||
Loans With No Related Allowance for Loan Losses, Recorded Investment | 157 | 167 |
Loans With No Related Allowance for Loan Losses, Principal Balance | 157 | 167 |
Loans With An Allowance for Loan Losses, Recorded Investment | 110 | 106 |
Loans With An Allowance for Loan Losses, Principal Balance | 113 | 109 |
Related Allowance | 35 | 31 |
Construction and Land Development | ||
Impaired loans by loan segment | ||
Loans With No Related Allowance for Loan Losses, Recorded Investment | 170 | 176 |
Loans With No Related Allowance for Loan Losses, Principal Balance | 779 | 785 |
HELOC and 1-4 Family Junior Mortgage | ||
Impaired loans by loan segment | ||
Loans With No Related Allowance for Loan Losses, Recorded Investment | 303 | 302 |
Loans With No Related Allowance for Loan Losses, Principal Balance | 490 | 489 |
1st REM - Rentals | ||
Impaired loans by loan segment | ||
Loans With No Related Allowance for Loan Losses, Recorded Investment | 940 | 757 |
Loans With No Related Allowance for Loan Losses, Principal Balance | 940 | 757 |
Consumer and other | ||
Impaired loans by loan segment | ||
Loans With An Allowance for Loan Losses, Recorded Investment | 14 | 14 |
Loans With An Allowance for Loan Losses, Principal Balance | 14 | 14 |
Related Allowance | 14 | 14 |
CRE Owner Occupied | ||
Impaired loans by loan segment | ||
Loans With No Related Allowance for Loan Losses, Recorded Investment | 1,847 | 236 |
Loans With No Related Allowance for Loan Losses, Principal Balance | 1,847 | $ 236 |
CRE Non-owner Occupied | ||
Impaired loans by loan segment | ||
Loans With No Related Allowance for Loan Losses, Recorded Investment | 224 | |
Loans With No Related Allowance for Loan Losses, Principal Balance | $ 224 |
Loans - Average balances and in
Loans - Average balances and interest income recognized (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Impaired loans by loan segment | ||
Loans With No Related Allowance for Loan Losses, Average Investment | $ 3,661 | $ 2,498 |
Loans With No Related Allowance for Loan Losses, Interest Recognized | 42 | 17 |
Loans With An Allowance for Loan Losses, Average Investment | 125 | 996 |
Loans With An Allowance for Loan Losses, Interest Recognized | 9 | |
Total Average Investment | 3,786 | 3,494 |
Total Interest Recognized | 42 | 26 |
Commercial | ||
Impaired loans by loan segment | ||
Loans With No Related Allowance for Loan Losses, Average Investment | 163 | |
Loans With No Related Allowance for Loan Losses, Interest Recognized | 3 | |
Loans With An Allowance for Loan Losses, Average Investment | 111 | 688 |
Loans With An Allowance for Loan Losses, Interest Recognized | 9 | |
Construction and Land Development | ||
Impaired loans by loan segment | ||
Loans With No Related Allowance for Loan Losses, Average Investment | 175 | 198 |
HELOC and 1-4 Family Junior Mortgage | ||
Impaired loans by loan segment | ||
Loans With No Related Allowance for Loan Losses, Average Investment | 329 | 157 |
Loans With No Related Allowance for Loan Losses, Interest Recognized | 2 | |
Loans With An Allowance for Loan Losses, Average Investment | 308 | |
1st REM - Rentals | ||
Impaired loans by loan segment | ||
Loans With No Related Allowance for Loan Losses, Average Investment | 932 | 1,637 |
Loans With No Related Allowance for Loan Losses, Interest Recognized | 11 | 9 |
CRE Owner Occupied | ||
Impaired loans by loan segment | ||
Loans With No Related Allowance for Loan Losses, Average Investment | 1,837 | 449 |
Loans With No Related Allowance for Loan Losses, Interest Recognized | 25 | 6 |
CRE Non-owner Occupied | ||
Impaired loans by loan segment | ||
Loans With No Related Allowance for Loan Losses, Average Investment | 225 | |
Loans With No Related Allowance for Loan Losses, Interest Recognized | 3 | |
Consumer and other | ||
Impaired loans by loan segment | ||
Loans With No Related Allowance for Loan Losses, Average Investment | $ 57 | |
Loans With An Allowance for Loan Losses, Average Investment | $ 14 |
Loans - Risk category of loans
Loans - Risk category of loans by loan segment (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | $ 2,002,817 | $ 1,912,038 |
Pass | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 1,953,248 | 1,904,068 |
Watch | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 45,804 | 5,275 |
Substandard | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 3,765 | 2,695 |
Commercial | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 299,425 | 276,035 |
Commercial | Pass | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 277,533 | 275,741 |
Commercial | Watch | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 21,625 | 21 |
Commercial | Substandard | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 267 | 273 |
Construction and Land Development | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 183,350 | 196,776 |
Construction and Land Development | Pass | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 183,045 | 196,462 |
Construction and Land Development | Watch | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 135 | 138 |
Construction and Land Development | Substandard | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 170 | 176 |
HELOC and 1-4 Family Junior Mortgage | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 30,928 | 28,621 |
HELOC and 1-4 Family Junior Mortgage | Pass | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 30,790 | 28,483 |
HELOC and 1-4 Family Junior Mortgage | Watch | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 138 | 138 |
1st REM - 1-4 Family | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 34,552 | 36,671 |
1st REM - 1-4 Family | Pass | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 34,253 | 36,370 |
1st REM - 1-4 Family | Watch | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 123 | 124 |
1st REM - 1-4 Family | Substandard | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 176 | 177 |
LOCs and 2nd REM - Rentals | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 19,935 | 18,671 |
LOCs and 2nd REM - Rentals | Pass | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 19,156 | 17,890 |
LOCs and 2nd REM - Rentals | Watch | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 476 | 479 |
LOCs and 2nd REM - Rentals | Substandard | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 303 | 302 |
1st REM - Rentals | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 187,175 | 176,648 |
1st REM - Rentals | Pass | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 185,643 | 174,781 |
1st REM - Rentals | Watch | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 768 | 1,287 |
1st REM - Rentals | Substandard | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 764 | 580 |
Multifamily | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 536,380 | 515,014 |
Multifamily | Pass | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 536,380 | 515,014 |
CRE Owner Occupied | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 75,207 | 66,584 |
CRE Owner Occupied | Pass | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 72,540 | 65,411 |
CRE Owner Occupied | Watch | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 820 | |
CRE Owner Occupied | Substandard | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 1,847 | 1,173 |
CRE Non-owner Occupied | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 631,541 | 592,545 |
CRE Non-owner Occupied | Pass | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 609,598 | 589,457 |
CRE Non-owner Occupied | Watch | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 21,719 | 3,088 |
CRE Non-owner Occupied | Substandard | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 224 | |
Consumer and other | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 4,324 | 4,473 |
Consumer and other | Pass | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | 4,310 | 4,459 |
Consumer and other | Substandard | ||
Risk category of loans by loan segment, based on the most recent analysis performed by management | ||
Totals | $ 14 | $ 14 |
Loans - Recorded investment in
Loans - Recorded investment in past due loans by loan segment (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Aging of the recorded investment in past due loans by loan segment | ||
Current | $ 2,002,190 | $ 1,911,174 |
Nonaccrual | 606 | 461 |
Totals | 2,002,817 | 1,912,038 |
30-89 Days Past Due | ||
Aging of the recorded investment in past due loans by loan segment | ||
Past Due | 21 | 403 |
Commercial | ||
Aging of the recorded investment in past due loans by loan segment | ||
Current | 299,397 | 276,028 |
Nonaccrual | 7 | 7 |
Totals | 299,425 | 276,035 |
Commercial | 30-89 Days Past Due | ||
Aging of the recorded investment in past due loans by loan segment | ||
Past Due | 21 | |
Construction and Land Development | ||
Aging of the recorded investment in past due loans by loan segment | ||
Current | 183,180 | 196,600 |
Nonaccrual | 170 | 176 |
Totals | 183,350 | 196,776 |
HELOC and 1-4 Family Junior Mortgage | ||
Aging of the recorded investment in past due loans by loan segment | ||
Current | 30,928 | 28,621 |
Totals | 30,928 | 28,621 |
1st REM - 1-4 Family | ||
Aging of the recorded investment in past due loans by loan segment | ||
Current | 34,552 | 36,671 |
Totals | 34,552 | 36,671 |
LOCs and 2nd REM - Rentals | ||
Aging of the recorded investment in past due loans by loan segment | ||
Current | 19,632 | 18,527 |
Nonaccrual | 303 | 144 |
Totals | 19,935 | 18,671 |
1st REM - Rentals | ||
Aging of the recorded investment in past due loans by loan segment | ||
Current | 187,049 | 176,114 |
Nonaccrual | 126 | 134 |
Totals | 187,175 | 176,648 |
1st REM - Rentals | 30-89 Days Past Due | ||
Aging of the recorded investment in past due loans by loan segment | ||
Past Due | 400 | |
Multifamily | ||
Aging of the recorded investment in past due loans by loan segment | ||
Current | 536,380 | 515,014 |
Totals | 536,380 | 515,014 |
CRE Owner Occupied | ||
Aging of the recorded investment in past due loans by loan segment | ||
Current | 75,207 | 66,584 |
Totals | 75,207 | 66,584 |
CRE Non-owner Occupied | ||
Aging of the recorded investment in past due loans by loan segment | ||
Current | 631,541 | 592,545 |
Totals | 631,541 | 592,545 |
Consumer and other | ||
Aging of the recorded investment in past due loans by loan segment | ||
Current | 4,324 | 4,470 |
Totals | $ 4,324 | 4,473 |
Consumer and other | 30-89 Days Past Due | ||
Aging of the recorded investment in past due loans by loan segment | ||
Past Due | $ 3 |
Loans - Summary of loans modifi
Loans - Summary of loans modified in TDRs and those restructurings (Details) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020USD ($)loan | Dec. 31, 2019USD ($)loan | |
Loans | ||
Troubled Debt Restructurings, Number of Loans | 4 | 3 |
New Troubled Debt Restructurings, Post-Modification Outstanding Balance | $ | $ 839 | $ 452 |
New Troubled Debt Restructurings, Number of Loans | 1 | |
Troubled Debt Restructurings That Subsequently Defaulted Within 12 Months of The Restructure Date, Number of Loans | 0 |
Premises and Equipment (Details
Premises and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Premises and Equipment | |||
Subtotal | $ 40,429 | $ 32,600 | |
Accumulated Depreciation | (5,158) | (4,972) | |
Totals | 35,271 | 27,628 | |
Depreciation and Amortization | 187 | $ 210 | |
Land | |||
Premises and Equipment | |||
Subtotal | 5,174 | 5,174 | |
Building | |||
Premises and Equipment | |||
Subtotal | $ 3,487 | 3,487 | |
Building | Minimum | |||
Premises and Equipment | |||
Estimated Useful Life | 15 years | ||
Building | Maximum | |||
Premises and Equipment | |||
Estimated Useful Life | 39 years | ||
Leasehold Improvements | |||
Premises and Equipment | |||
Subtotal | $ 3,344 | 3,344 | |
Leasehold Improvements | Minimum | |||
Premises and Equipment | |||
Estimated Useful Life | 3 years | ||
Leasehold Improvements | Maximum | |||
Premises and Equipment | |||
Estimated Useful Life | 10 years | ||
Furniture and Equipment | |||
Premises and Equipment | |||
Subtotal | $ 4,838 | 3,902 | |
Furniture and Equipment | Minimum | |||
Premises and Equipment | |||
Estimated Useful Life | 3 years | ||
Furniture and Equipment | Maximum | |||
Premises and Equipment | |||
Estimated Useful Life | 5 years | ||
Construction in Progress | |||
Premises and Equipment | |||
Subtotal | $ 23,586 | $ 16,693 |
Deposits (Details)
Deposits (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Deposits, by Type [Abstract] | ||
Transaction Deposits | $ 731,700 | $ 712,136 |
Savings and Money Market Deposits | 514,113 | 516,785 |
Time Deposits | 393,340 | 360,027 |
Brokered Deposits | 260,974 | 234,362 |
Total Deposits | $ 1,900,127 | $ 1,823,310 |
Derivative Instruments and He_3
Derivative Instruments and Hedging Activities - Non-hedge Derivatives (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Derivatives, Fair Value [Line Items] | ||
Estimated Fair Value, Asset | $ 3,254 | $ 284 |
Estimated Fair Value, Liability | (6,787) | (902) |
Interest Rate Swap | Derivatives not designated as hedging instruments | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount, Asset | 50,113 | 7,140 |
Notional Amount, Liability | 50,113 | 7,140 |
Notional Amount | 100,226 | 14,280 |
Estimated Fair Value, Asset | 3,254 | 150 |
Estimated Fair Value, Liability | $ (3,254) | $ (150) |
Derivative Instruments and He_4
Derivative Instruments and Hedging Activities - Cash Flow Derivatives (Details) - Cash flow hedge - Designated as Hedging Instrument - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Dec. 31, 2019 | |
Cash Flow Hedging Derivatives | ||
Amount expected to be reclassified from AOCI into earnings | $ 693 | |
Interest Rate Swap | ||
Cash Flow Hedging Derivatives | ||
Notional Amount | $ 102,500 | $ 48,000 |
Weighted Average Pay Rate | 1.35% | 1.89% |
Weighted Average Receive Rate | 1.51% | 2.25% |
Derivative Weighted Average Maturity | 4 years 5 months 23 days | 3 years 6 months 11 days |
Net Unrealized Gain (Loss) | $ (3,533) | $ (618) |
Derivative Instruments and He_5
Derivative Instruments and Hedging Activities - Cash Flow Hedging Reclassification (Details) - Cash flow hedge - Interest Rate Swap - Designated as Hedging Instrument - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Derivatives, Fair Value [Line Items] | ||
Notional Amount, Asset | $ 18,000 | |
Notional Amount, Liability | $ 102,500 | 30,000 |
Estimated Fair Value, Asset | 134 | |
Estimated Fair Value, Liability | $ (3,533) | $ (752) |
Derivative Instruments and He_6
Derivative Instruments and Hedging Activities - Derivative Instruments in Cash Flow Hedging Relationships (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain or (Loss) Reclassified from AOCI into earnings | $ (15) | $ (5) |
Amounts reclassified from AOCI into earnings related to hedge ineffectiveness | 0 | 0 |
Amount expected to be relassified from AOCI into earnings related to hedge ineffectiveness | 0 | $ 0 |
Interest Rate Swap | Interest expense | Cash flow hedge | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain or (Loss) Reclassified from AOCI into earnings | $ (18) |
Tax Credit Investments - Invest
Tax Credit Investments - Investments (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Investments in qualified affordable housing projects and other tax credit investments | |||
Investment | $ 4,001 | $ 4,410 | |
Unfunded Commitment | 2,895 | 3,395 | |
Amortization Expense | 156 | $ 249 | |
Tax Benefit Recognized | (253) | (297) | |
Low Income Housing Tax Credit (LIHTC) | |||
Investments in qualified affordable housing projects and other tax credit investments | |||
Investment | 2,077 | 2,148 | |
Amortization Expense | 71 | 72 | |
Tax Benefit Recognized | (83) | (83) | |
Federal Historic Tax Credit (FHTC) | |||
Investments in qualified affordable housing projects and other tax credit investments | |||
Investment | 1,924 | 2,262 | |
Unfunded Commitment | 2,895 | $ 3,395 | |
Amortization Expense | 85 | 177 | |
Tax Benefit Recognized | $ (170) | $ (214) |
Commitments, Contingencies an_3
Commitments, Contingencies and Credit Risk (Details) - USD ($) $ in Thousands | Dec. 03, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Commitments Outstanding | ||||||
Unfunded Commitments Under Lines of Credit | $ 469,221 | $ 469,221 | $ 469,221 | $ 500,962 | ||
Letters of Credit | 73,364 | 73,364 | 73,364 | 79,225 | ||
Totals | 542,585 | 542,585 | 542,585 | 580,187 | ||
Payment of construction costs | $ 7,830 | $ 2,833 | ||||
Construction of corporate headquarters office | ||||||
Commitments Outstanding | ||||||
Percentage of cost of work | 3.75% | |||||
Commitment under contract | $ 23,000 | |||||
Payment of construction costs | 19,232 | |||||
Contract With Third Party | ||||||
Commitments Outstanding | ||||||
Commitment under contract | $ 6,321 | |||||
Payment of construction costs | 1,815 | |||||
Federal Home Loan Bank Advances | ||||||
Commitments Outstanding | ||||||
Outstanding letters of credit | $ 135,943 | $ 135,943 | $ 135,943 | $ 108,502 |
Stock Options and Restricted _3
Stock Options and Restricted Stock Awards - Narrative (Details) $ in Millions | 3 Months Ended | ||
Mar. 31, 2020USD ($)itemshares | Dec. 31, 2019shares | Mar. 31, 2019shares | |
Stock Options and Restricted Stock Awards | |||
Number of banks in the index | item | 54 | ||
Minimum | |||
Stock Options and Restricted Stock Awards | |||
Market capitalization | $ | $ 500 | ||
Maximum | |||
Stock Options and Restricted Stock Awards | |||
Market capitalization | $ | $ 4,500 | ||
2012 Plan | |||
Stock Options and Restricted Stock Awards | |||
Number of shares authorized for grant options to its directors, officers, and employees | 750,000 | ||
Term of award | 10 years | ||
Vesting period | 5 years | ||
Number of unissued shares of the Company’s common stock authorized for option grants | 0 | 0 | |
2017 Plan | |||
Stock Options and Restricted Stock Awards | |||
Number of shares authorized for grant options to its directors, officers, and employees | 1,500,000 | ||
Term of award | 10 years | ||
Number of unissued shares of the Company’s common stock authorized for option grants | 310,600 | 310,600 | |
2017 Plan | Minimum | |||
Stock Options and Restricted Stock Awards | |||
Vesting period | 4 years | ||
2017 Plan | Maximum | |||
Stock Options and Restricted Stock Awards | |||
Vesting period | 5 years | ||
2019 EIP | |||
Stock Options and Restricted Stock Awards | |||
Number of shares authorized for grant options to its directors, officers, and employees | 1,000,000 | ||
Term of award | 10 years | ||
Vesting period | 4 years | ||
Number of unissued shares of the Company’s common stock authorized for option grants | 830,373 | 867,040 |
Stock Options and Restricted _4
Stock Options and Restricted Stock Awards - Black-Scholes Assumptions (Details) | 3 Months Ended |
Mar. 31, 2020 | |
Black-Scholes Assumptions | |
Expected Life | 7 years |
Expected Volatility | 19.56% |
Risk-Free Interest Rate | 0.97% |
Stock Options and Restricted _5
Stock Options and Restricted Stock Awards - Stock Option Plans (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Stock Option Plans | ||
Outstanding at Beginning of Year | 1,961,650 | |
Granted | 25,000 | |
Outstanding at End of Year | 1,986,650 | |
Options Exercisable at End of Year | 1,004,050 | |
Weighted Average Exercise Price | ||
Outstanding at Beginning of Year | $ 7.08 | |
Granted | 12.67 | |
Outstanding at End of Year | 7.15 | |
Options Exercisable at End of Year | $ 5.01 | |
Stock Options | ||
Weighted Average Exercise Price | ||
Compensation expense for stock options | $ 218 | $ 175 |
Stock Options and Restricted _6
Stock Options and Restricted Stock Awards - Exercise Price (Details) $ / shares in Units, $ in Thousands | 3 Months Ended |
Mar. 31, 2020USD ($)$ / sharesshares | |
Exercise Price | |
Options Outstanding, Number Outstanding | 1,986,650 |
Options Outstanding, Remaining Contractual Life | 6 years 9 months 18 days |
Options Outstanding, Exercise Price | $ / shares | $ 7.15 |
Options Exercisable, Number Outstanding | 1,004,050 |
Total unrecognized compensation cost | $ | $ 2,593 |
Weighted-average period over which total unrecognized compensation cost is expected to be recognized (in years) | 4 years 9 months 18 days |
2.13 | |
Exercise Price | |
Options Outstanding, Number Outstanding | 74,750 |
Options Outstanding, Remaining Contractual Life | 3 years |
Options Outstanding, Exercise Price | $ / shares | $ 2.13 |
Options Exercisable, Number Outstanding | 74,750 |
3.00 | |
Exercise Price | |
Options Outstanding, Number Outstanding | 455,000 |
Options Outstanding, Remaining Contractual Life | 3 years 9 months 18 days |
Options Outstanding, Exercise Price | $ / shares | $ 3 |
Options Exercisable, Number Outstanding | 455,000 |
3.58 | |
Exercise Price | |
Options Outstanding, Number Outstanding | 45,000 |
Options Outstanding, Remaining Contractual Life | 4 years 9 months 18 days |
Options Outstanding, Exercise Price | $ / shares | $ 3.58 |
Options Exercisable, Number Outstanding | 45,000 |
7.47 | |
Exercise Price | |
Options Outstanding, Number Outstanding | 1,023,900 |
Options Outstanding, Remaining Contractual Life | 7 years 6 months |
Options Outstanding, Exercise Price | $ / shares | $ 7.47 |
Options Exercisable, Number Outstanding | 402,300 |
13.22 | |
Exercise Price | |
Options Outstanding, Number Outstanding | 25,000 |
Options Outstanding, Remaining Contractual Life | 8 years 1 month 6 days |
Options Outstanding, Exercise Price | $ / shares | $ 13.22 |
Options Exercisable, Number Outstanding | 5,000 |
12.86 | |
Exercise Price | |
Options Outstanding, Number Outstanding | 45,000 |
Options Outstanding, Remaining Contractual Life | 8 years 4 months 24 days |
Options Outstanding, Exercise Price | $ / shares | $ 12.86 |
Options Exercisable, Number Outstanding | 9,000 |
12.94 | |
Exercise Price | |
Options Outstanding, Number Outstanding | 30,000 |
Options Outstanding, Remaining Contractual Life | 8 years 6 months |
Options Outstanding, Exercise Price | $ / shares | $ 12.94 |
Options Exercisable, Number Outstanding | 6,000 |
11.59 | |
Exercise Price | |
Options Outstanding, Number Outstanding | 25,000 |
Options Outstanding, Remaining Contractual Life | 8 years 7 months 6 days |
Options Outstanding, Exercise Price | $ / shares | $ 11.59 |
Options Exercisable, Number Outstanding | 5,000 |
11.15 | |
Exercise Price | |
Options Outstanding, Number Outstanding | 10,000 |
Options Outstanding, Remaining Contractual Life | 8 years 10 months 24 days |
Options Outstanding, Exercise Price | $ / shares | $ 11.15 |
Options Exercisable, Number Outstanding | 2,000 |
11.13 | |
Exercise Price | |
Options Outstanding, Number Outstanding | 50,000 |
Options Outstanding, Remaining Contractual Life | 9 years 4 months 24 days |
Options Outstanding, Exercise Price | $ / shares | $ 11.13 |
12.92 | |
Exercise Price | |
Options Outstanding, Number Outstanding | 178,000 |
Options Outstanding, Remaining Contractual Life | 9 years 8 months 12 days |
Options Outstanding, Exercise Price | $ / shares | $ 12.92 |
12.67 | |
Exercise Price | |
Options Outstanding, Number Outstanding | 25,000 |
Options Outstanding, Remaining Contractual Life | 9 years 10 months 24 days |
Options Outstanding, Exercise Price | $ / shares | $ 12.67 |
Stock Options and Restricted _7
Stock Options and Restricted Stock Awards - Non-Vested Options (Details) | 3 Months Ended |
Mar. 31, 2020$ / sharesshares | |
Number of Shares | |
Nonvested Options at beginning of period | shares | 969,600 |
Granted | shares | 25,000 |
Vested | shares | (12,000) |
Nonvested Options at end of period | shares | 982,600 |
Weighted Average Grant Date Fair Value | |
Nonvested Options at beginning of period | $ / shares | $ 3.08 |
Granted | $ / shares | 2.94 |
Vested | $ / shares | 1.99 |
Nonvested Options at end of period | $ / shares | $ 3.09 |
Stock Options and Restricted _8
Stock Options and Restricted Stock Awards - Restricted Stock Awards (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Number of Shares | ||
Nonvested Awards at beginning of period | 132,960 | |
Granted | 3,946 | |
Nonvested Awards at end of period | 136,906 | |
Weighted Average Grant Date Fair Value | ||
Nonvested Awards at beginning of period | $ 12.92 | |
Granted | 12.67 | |
Nonvested Awards at end of period | $ 12.91 | |
Compensation expense | ||
Recognition period for non vested restricted stock awards | 4 years 9 months 18 days | |
Shares issued for services on board of directors | 7,721 | |
Value of shares issued for services on board of directors | $ 75 | |
Restricted Stock | ||
Compensation expense | ||
Compensation expense recognized | 108 | $ 0 |
Unrecognized compensation cost | $ 1,630 | |
Recognition period for non vested restricted stock awards | 4 years |
Regulatory Capital - Capital Am
Regulatory Capital - Capital Amounts and Ratios (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Total Risk-Based Capital | ||
Total Risk-Based Capital, Actual amount | $ 292,080 | $ 269,613 |
Total Risk-Based Capital, For Capital Adequacy Purposes, amount | 174,641 | 166,163 |
Total Risk-Based Capital, For Capital Adequacy Purposes Plus Capital Conversion Buffer, amount | $ 229,216 | $ 218,089 |
Total Risk-Based Capital, Actual ratio | 13.38% | 12.98% |
Total Risk-Based Capital, For Capital Adequacy Purposes, Ratio | 8.00% | 8.00% |
Total Risk-Based Capital, For Capital Adequacy Purposes Plus Capital Conservation Buffer, Ratio | 10.50% | 10.50% |
Tier 1 Risk-Based Capital | ||
Tier One Risk Based Capital | $ 242,376 | $ 236,533 |
Tier 1 Risk-Based Capital, For Capital Adequacy Purposes, amount | 130,980 | 124,623 |
Tier 1 Risk-Based Capital, For Capital Adequacy Purposes Plus Capital Conservation Buffer, amount | $ 185,556 | $ 176,549 |
Tier 1 Risk-Based Capital, Actual ratio | 11.10% | 11.39% |
Tier 1 Risk-Based Capital, For Capital Adequacy Purposes, Ratio | 6.00% | 6.00% |
Tier 1 Risk-Based Capital, For Capital Adequacy Purposes Plus Capital Conservation Buffer, Ratio | 8.50% | 8.50% |
Common Equity Tier 1 Capital | ||
Common Equity Tier 1 Capital, Actual amount | $ 242,376 | $ 236,533 |
Common Equity Tier 1 Capital, For Capital Adequacy Purposes, amount | 98,235 | 93,467 |
Common Equity Tier 1 Capital, For Capital Adequacy Purposes Plus Capital Conservation Buffer, amount | $ 152,810 | $ 145,393 |
Common Equity Tier 1 Capital, Actual ratio | 11.10% | 11.39% |
Common Equity Tier 1 Capital, For Capital Adequacy Purposes, Ratio | 4.50% | 4.50% |
Common Equity Tier 1 Capital, For Capital Adequacy Purposes Plus Capital Conservation Buffer, Ratio | 7.00% | 7.00% |
Leverage Ratio | ||
Tier 1 Leverage Ratio, Actual amount | $ 242,376 | $ 236,533 |
Tier 1 Leverage Ratio, For Capital Adequacy Purposes, amount | 92,259 | 88,498 |
Tier 1 Leverage Ratio, For Capital Adequacy Purposes Plus Capital Conservation Buffer, amount | $ 92,259 | $ 88,498 |
Tier 1 Leverage Ratio, Actual ratio | 10.51% | 10.69% |
Tier 1 Leverage Ratio, For Capital Adequacy Purposes, Ratio | 4.00% | 4.00% |
Tier 1 Leverage Ratio, For Capital Adequacy Purposes Plus Capital Conservation Buffer, Ratio | 4.00% | 4.00% |
Bank | ||
Total Risk-Based Capital | ||
Total Risk-Based Capital, Actual amount | $ 276,487 | $ 252,501 |
Total Risk-Based Capital, For Capital Adequacy Purposes, amount | 174,523 | 166,137 |
Total Risk-Based Capital, For Capital Adequacy Purposes Plus Capital Conversion Buffer, amount | 229,062 | 218,055 |
Total Risk-Based Capital, To be Well Capitalized Under Prompt Corrective Action Regulations, amount | $ 218,154 | $ 207,671 |
Total Risk-Based Capital, Actual ratio | 12.67% | 12.16% |
Total Risk-Based Capital, For Capital Adequacy Purposes, Ratio | 8.00% | 8.00% |
Total Risk-Based Capital, For Capital Adequacy Purposes Plus Capital Conservation Buffer, Ratio | 10.50% | 10.50% |
Total Risk-Based Capital, To be Well Capitalized Under Prompt Corrective Action Regulations, Ratio | 10.00% | 10.00% |
Tier 1 Risk-Based Capital | ||
Tier One Risk Based Capital | $ 251,542 | $ 243,461 |
Tier 1 Risk-Based Capital, For Capital Adequacy Purposes, amount | 130,893 | 124,603 |
Tier 1 Risk-Based Capital, For Capital Adequacy Purposes Plus Capital Conservation Buffer, amount | 185,431 | 176,521 |
Tier 1 Risk-Based Capital, To be Well Capitalized Under Prompt Corrective Action Regulations, amount | $ 174,523 | $ 166,137 |
Tier 1 Risk-Based Capital, Actual ratio | 11.53% | 11.72% |
Tier 1 Risk-Based Capital, For Capital Adequacy Purposes, Ratio | 6.00% | 6.00% |
Tier 1 Risk-Based Capital, For Capital Adequacy Purposes Plus Capital Conservation Buffer, Ratio | 8.50% | 8.50% |
Tier 1 Risk-Based Capital, To be Well Capitalized Under Prompt Corrective Action Regulations, Ratio | 8.00% | 8.00% |
Common Equity Tier 1 Capital | ||
Common Equity Tier 1 Capital, Actual amount | $ 251,542 | $ 243,461 |
Common Equity Tier 1 Capital, For Capital Adequacy Purposes, amount | 98,169 | 93,452 |
Common Equity Tier 1 Capital, For Capital Adequacy Purposes Plus Capital Conservation Buffer, amount | 152,708 | 145,370 |
Common Equity Tier 1 Capital, To be Well Capitalized Under Prompt Corrective Action Regulations, amount | $ 141,800 | $ 134,986 |
Common Equity Tier 1 Capital, Actual ratio | 11.53% | 11.72% |
Common Equity Tier 1 Capital, For Capital Adequacy Purposes, Ratio | 4.50% | 4.50% |
Common Equity Tier 1 Capital, For Capital Adequacy Purposes Plus Capital Conservation Buffer, Ratio | 7.00% | 7.00% |
Common Equity Tier 1 Capital, To be Well Capitalized Under Prompt Corrective Action Regulations, Ratio | 6.50% | 6.50% |
Leverage Ratio | ||
Tier 1 Leverage Ratio, Actual amount | $ 251,542 | $ 243,461 |
Tier 1 Leverage Ratio, For Capital Adequacy Purposes, amount | 92,088 | 88,455 |
Tier 1 Leverage Ratio, For Capital Adequacy Purposes Plus Capital Conservation Buffer, amount | 92,088 | 88,455 |
Tier 1 Leverage Ratio, To be Well Capitalized Under Prompt Corrective Action Regulations, amount | $ 115,110 | $ 110,569 |
Tier 1 Leverage Ratio, Actual ratio | 10.93% | 11.01% |
Tier 1 Leverage Ratio, For Capital Adequacy Purposes, Ratio | 4.00% | 4.00% |
Tier 1 Leverage Ratio, For Capital Adequacy Purposes Plus Capital Conservation Buffer, Ratio | 4.00% | 4.00% |
Tier 1 Leverage Ratio, To be Well Capitalized Under Prompt Corrective Action Regulations, Ratio | 5.00% | 5.00% |
Stock Repurchase Program (Detai
Stock Repurchase Program (Details) - USD ($) $ / shares in Units, $ in Thousands | Jul. 23, 2019 | Jan. 22, 2019 | Mar. 31, 2020 |
Stock Repurchase Program | |||
Increase in stock repurchase authorized amount | $ 10,000 | ||
Authorized stock repurchase amount | $ 25,000 | $ 15,000 | |
Authorized repurchase program period | 24 months | ||
Shares repurchased | 177,864 | ||
Percentage of shares outstanding of entity | 1.00% | ||
Weighted average share repurchase price | $ 11.52 | ||
Stock Repurchases | $ 2,050 | ||
Remaining repurchase amount | $ 8,000 |
Fair Value Measurement - Recurr
Fair Value Measurement - Recurring (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Securities Available for Sale, at Fair Value | $ 307,317 | $ 289,877 |
Interest Rate Swaps | 3,254 | 284 |
Interest Rate Swaps | 6,787 | 902 |
Recurring | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Interest Rate Swaps | 3,254 | 284 |
Total Fair Value of Financial Assets | 310,571 | 290,161 |
Interest Rate Swaps | 6,787 | 902 |
Total Fair Value of Financial Liabilities | 6,787 | 902 |
U.S. Treasury Securities | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Securities Available for Sale, at Fair Value | 4,998 | |
U.S. Treasury Securities | Recurring | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Securities Available for Sale, at Fair Value | 4,998 | |
Municipal Bonds | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Securities Available for Sale, at Fair Value | 122,232 | 105,743 |
Municipal Bonds | Recurring | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Securities Available for Sale, at Fair Value | 122,232 | 105,743 |
Mortgage-Backed Securities | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Securities Available for Sale, at Fair Value | 62,793 | 64,728 |
Mortgage-Backed Securities | Recurring | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Securities Available for Sale, at Fair Value | 62,793 | 64,728 |
Corporate Securities | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Securities Available for Sale, at Fair Value | 49,940 | 50,176 |
Corporate Securities | Recurring | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Securities Available for Sale, at Fair Value | 49,940 | 50,176 |
SBA Securities | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Securities Available for Sale, at Fair Value | 46,592 | 49,559 |
SBA Securities | Recurring | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Securities Available for Sale, at Fair Value | 46,592 | 49,559 |
Asset-Backed Securities | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Securities Available for Sale, at Fair Value | 25,760 | 14,673 |
Asset-Backed Securities | Recurring | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Securities Available for Sale, at Fair Value | 25,760 | 14,673 |
Level 1 | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Securities Available for Sale, at Fair Value | 4,998 | |
Level 1 | Recurring | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Total Fair Value of Financial Assets | 4,998 | |
Level 1 | U.S. Treasury Securities | Recurring | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Securities Available for Sale, at Fair Value | 4,998 | |
Level 2 | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Securities Available for Sale, at Fair Value | 307,317 | 284,879 |
Interest Rate Swaps | 3,254 | 284 |
Interest Rate Swaps | 6,787 | 902 |
Level 2 | Recurring | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Interest Rate Swaps | 3,254 | 284 |
Total Fair Value of Financial Assets | 310,571 | 285,163 |
Interest Rate Swaps | 6,787 | 902 |
Total Fair Value of Financial Liabilities | 6,787 | 902 |
Level 2 | Municipal Bonds | Recurring | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Securities Available for Sale, at Fair Value | 122,232 | 105,743 |
Level 2 | Mortgage-Backed Securities | Recurring | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Securities Available for Sale, at Fair Value | 62,793 | 64,728 |
Level 2 | Corporate Securities | Recurring | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Securities Available for Sale, at Fair Value | 49,940 | 50,176 |
Level 2 | SBA Securities | Recurring | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Securities Available for Sale, at Fair Value | 46,592 | 49,559 |
Level 2 | Asset-Backed Securities | Recurring | ||
Balances of the assets and liabilities measured at fair value on a recurring basis | ||
Securities Available for Sale, at Fair Value | $ 25,760 | $ 14,673 |
Fair Value Measurement - Nonrec
Fair Value Measurement - Nonrecurring (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Balances of the assets and liabilities measured at fair value on a nonrecurring basis | |||
Loss | $ 2,100 | $ 600 | |
Nonrecurring | |||
Balances of the assets and liabilities measured at fair value on a nonrecurring basis | |||
Loss | 49 | $ 206 | |
Nonrecurring | Impaired Loans | |||
Balances of the assets and liabilities measured at fair value on a nonrecurring basis | |||
Loss | 49 | 206 | |
Level 2 | Nonrecurring | |||
Balances of the assets and liabilities measured at fair value on a nonrecurring basis | |||
Assets measured at fair value | 75 | 75 | |
Level 2 | Nonrecurring | Impaired Loans | |||
Balances of the assets and liabilities measured at fair value on a nonrecurring basis | |||
Assets measured at fair value | $ 75 | $ 75 |
Fair Value Measurement - Estima
Fair Value Measurement - Estimated Fair Value (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Financial Assets: | ||
Cash and Due From Banks | $ 61,526 | $ 31,935 |
Bank-Owned Certificates of Deposit | 2,895 | 2,654 |
Securities Available for Sale, at Fair Value | 307,317 | 289,877 |
FHLB Stock, at Cost | 11,017 | 7,824 |
Loans, Net | 1,972,896 | 1,884,000 |
Accrued Interest Receivable | 7,102 | 6,775 |
Interest Rate Swaps | 3,254 | 284 |
Financial Liabilities: | ||
Deposits | 1,900,127 | 1,823,310 |
Notes Payable | 12,500 | 13,000 |
FHLB Advances | 207,500 | 136,500 |
Subordinated Debentures | 24,759 | 24,733 |
Accrued Interest Payable | 1,688 | 1,982 |
Interest Rate Swaps | 6,787 | 902 |
Level 1 | ||
Financial Assets: | ||
Cash and Due From Banks | 61,526 | 31,935 |
Securities Available for Sale, at Fair Value | 4,998 | |
Level 2 | ||
Financial Assets: | ||
Bank-Owned Certificates of Deposit | 2,968 | 2,677 |
Securities Available for Sale, at Fair Value | 307,317 | 284,879 |
FHLB Stock, at Cost | 11,017 | 7,824 |
Loans, Net | 1,989,365 | 1,891,987 |
Accrued Interest Receivable | 7,102 | 6,775 |
Interest Rate Swaps | 3,254 | 284 |
Financial Liabilities: | ||
Deposits | 1,912,436 | 1,821,915 |
Notes Payable | 12,525 | 13,022 |
FHLB Advances | 218,362 | 141,152 |
Subordinated Debentures | 26,630 | 25,309 |
Accrued Interest Payable | 1,688 | 1,982 |
Interest Rate Swaps | 6,787 | 902 |
Estimated Fair Value | ||
Financial Assets: | ||
Cash and Due From Banks | 61,526 | 31,935 |
Bank-Owned Certificates of Deposit | 2,968 | 2,677 |
Securities Available for Sale, at Fair Value | 307,317 | 289,877 |
FHLB Stock, at Cost | 11,017 | 7,824 |
Loans, Net | 1,989,365 | 1,891,987 |
Accrued Interest Receivable | 7,102 | 6,775 |
Interest Rate Swaps | 3,254 | 284 |
Financial Liabilities: | ||
Deposits | 1,912,436 | 1,821,915 |
Notes Payable | 12,525 | 13,022 |
FHLB Advances | 218,362 | 141,152 |
Subordinated Debentures | 26,630 | 25,309 |
Accrued Interest Payable | 1,688 | 1,982 |
Interest Rate Swaps | $ 6,787 | $ 902 |
Subsequent Events (Details)
Subsequent Events (Details) $ in Thousands | May 05, 2020USD ($)borrowerloan | Mar. 31, 2020USD ($)loan | Dec. 31, 2019USD ($)loan |
Subsequent Events | |||
Number of PPP loans | loan | 4 | 3 | |
Total Loans, Gross | $ 2,002,817 | $ 1,912,038 | |
Subsequent Event | PPP | |||
Subsequent Events | |||
Number of PPP loans | loan | 1,000 | ||
Total Loans, Gross | $ 181,847 | ||
Subsequent Event | COVID-19 related loan modifications | |||
Subsequent Events | |||
Loan modifications | $ 288,019 | ||
Number of borrowers | borrower | 157 | ||
Percentage of loan portfolio | 15.00% |