Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2018 | Jul. 31, 2018 | |
Document and Entity Information | ||
Entity Registrant Name | Territorial Bancorp Inc. | |
Entity Central Index Key | 1,447,051 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2018 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 9,739,697 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q2 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
ASSETS | ||
Cash and cash equivalents | $ 27,672 | $ 32,089 |
Investment securities available for sale | 2,658 | 2,851 |
Investment securities held to maturity, at amortized cost (fair value of $382,962 and $406,663 at June 30, 2018 and December 31, 2017, respectively) | 392,189 | 404,792 |
Loans held for sale | 403 | |
Loans receivable, net | 1,536,392 | 1,488,971 |
Federal Home Loan Bank stock, at cost | 5,925 | 6,541 |
Federal Reserve Bank stock, at cost | 3,106 | 3,103 |
Accrued interest receivable | 5,195 | 5,142 |
Premises and equipment, net | 5,362 | 5,721 |
Bank-owned life insurance | 44,631 | 44,201 |
Income taxes receivable | 1,196 | 1,571 |
Deferred income tax assets, net | 4,210 | 4,609 |
Prepaid expenses and other assets | 3,923 | 3,852 |
Total assets | 2,032,459 | 2,003,846 |
Liabilities: | ||
Deposits | 1,647,183 | 1,597,295 |
Advances from the Federal Home Loan Bank | 88,000 | 107,200 |
Securities sold under agreements to repurchase | 30,000 | 30,000 |
Accounts payable and accrued expenses | 24,418 | 26,390 |
Income taxes payable | 1,459 | 1,483 |
Advance payments by borrowers for taxes and insurance | 6,700 | 6,624 |
Total liabilities | 1,797,760 | 1,768,992 |
Stockholders' Equity: | ||
Preferred stock, $0.01 par value; authorized 50,000,000 shares, no shares issued or outstanding | ||
Common stock, $0.01 par value; authorized 100,000,000 shares; issued and outstanding 9,749,697 and 9,915,058 shares at June 30, 2018 and December 31, 2017, respectively | 98 | 99 |
Additional paid-in capital | 67,584 | 73,050 |
Unearned ESOP shares | (5,138) | (5,383) |
Retained earnings | 179,044 | 172,782 |
Accumulated other comprehensive loss | (6,889) | (5,694) |
Total stockholders' equity | 234,699 | 234,854 |
Total liabilities and stockholders' equity | $ 2,032,459 | $ 2,003,846 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Consolidated Balance Sheets | ||
Investment securities held to maturity, fair value (in dollars) | $ 382,962 | $ 406,663 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, authorized shares | 50,000,000 | 50,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized shares | 100,000,000 | 100,000,000 |
Common stock, shares issued | 9,749,697 | 9,915,058 |
Common stock, shares outstanding | 9,749,697 | 9,915,058 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Interest income: | ||||
Loans | $ 14,884 | $ 13,527 | $ 29,791 | $ 27,040 |
Investment securities | 3,122 | 3,078 | 6,251 | 6,159 |
Other investments | 176 | 172 | 374 | 359 |
Total interest income | 18,182 | 16,777 | 36,416 | 33,558 |
Interest expense: | ||||
Deposits | 2,690 | 1,775 | 5,141 | 3,426 |
Advances from the Federal Home Loan Bank | 459 | 261 | 878 | 515 |
Securities sold under agreements to repurchase | 126 | 217 | 251 | 433 |
Total interest expense | 3,275 | 2,253 | 6,270 | 4,374 |
Net interest income | 14,907 | 14,524 | 30,146 | 29,184 |
Provision (reversal of provision) for loan losses | 60 | (123) | 69 | (52) |
Net interest income after provision (reversal of provision) for loan losses | 14,847 | 14,647 | 30,077 | 29,236 |
Noninterest income: | ||||
Service fees on loan and deposit accounts | 487 | 507 | 902 | 1,063 |
Income on bank-owned life insurance | 216 | 227 | 431 | 453 |
Gain on sale of investment securities | 45 | 186 | 45 | 281 |
Gain on sale of loans | 10 | 63 | 53 | 126 |
Other | 79 | 76 | 148 | 158 |
Total noninterest income | 837 | 1,059 | 1,579 | 2,081 |
Noninterest expense: | ||||
Salaries and employee benefits | 5,496 | 4,900 | 11,143 | 9,983 |
Occupancy | 1,574 | 1,461 | 3,090 | 2,910 |
Equipment | 997 | 882 | 1,939 | 1,748 |
Federal deposit insurance premiums | 154 | 148 | 307 | 296 |
Other general and administrative expenses | 1,153 | 1,363 | 2,288 | 2,524 |
Total noninterest expense | 9,374 | 8,754 | 18,767 | 17,461 |
Income before income taxes | 6,310 | 6,952 | 12,889 | 13,856 |
Income taxes | 1,347 | 2,651 | 3,106 | 5,234 |
Net income | $ 4,963 | $ 4,301 | $ 9,783 | $ 8,622 |
Basic earnings per share (in dollars per share) | $ 0.54 | $ 0.46 | $ 1.05 | $ 0.93 |
Diluted earnings per share (in dollars per share) | 0.53 | 0.45 | 1.03 | 0.90 |
Cash dividends declared per common share (in dollars per share) | $ 0.30 | $ 0.20 | $ 0.5 | $ 0.40 |
Basic weighted-average shares outstanding (in shares) | 9,219,859 | 9,255,739 | 9,251,999 | 9,235,553 |
Diluted weighted-average shares outstanding (in shares) | 9,394,031 | 9,539,757 | 9,439,618 | 9,539,543 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Consolidated Statements of Comprehensive Income | ||||
Net income | $ 4,963 | $ 4,301 | $ 9,783 | $ 8,622 |
Change in unrealized loss on securities, net of tax | (11) | (15) | (60) | (13) |
Other comprehensive loss, net of tax | (11) | (15) | (60) | (13) |
Comprehensive income | $ 4,952 | $ 4,286 | $ 9,723 | $ 8,609 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Common Stock | Additional Paid-in Capital | Unearned ESOP Shares | Retained Earnings | Accumulated Other Comprehensive Loss | Total |
Balance at Dec. 31, 2016 | $ 98 | $ 71,914 | $ (5,872) | $ 168,962 | $ (5,316) | $ 229,786 |
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 8,622 | 8,622 | ||||
Other comprehensive loss | (13) | (13) | ||||
Cash dividends declared ($0.50 per share and $0.40 per share for the six months ended June 30, 2018 and June 30, 2017, respectively) | (3,692) | (3,692) | ||||
Share-based compensation | (11) | (11) | ||||
Allocation of ESOP shares (24,466 shares for the six months ended June 30, 2018 and June 30, 2017) | 530 | 245 | 775 | |||
Repurchase of company common stock (237,570 shares and 59,430 shares for the six months ended June 30, 2018 and June 30, 2017, respectively) | (1) | (1,924) | (1,925) | |||
Exercise of options for common stock (69,008 shares and 110,894 shares for the six months ended June 30, 2018 and June 30, 2017, respectively) | 1 | 1,924 | 1,925 | |||
Balance at Jun. 30, 2017 | 98 | 72,433 | (5,627) | 173,892 | (5,329) | 235,467 |
Balance at Mar. 31, 2017 | (5,314) | |||||
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 4,301 | |||||
Other comprehensive loss | (15) | (15) | ||||
Balance at Jun. 30, 2017 | 98 | 72,433 | (5,627) | 173,892 | (5,329) | 235,467 |
Balance at Dec. 31, 2017 | 99 | 73,050 | (5,383) | 172,782 | (5,694) | 234,854 |
Increase (Decrease) in Stockholders' Equity | ||||||
Reclassification of deferred taxes | 1,100 | |||||
Balance at Mar. 31, 2018 | (6,878) | |||||
Balance at Dec. 31, 2017 | 99 | 73,050 | (5,383) | 172,782 | (5,694) | 234,854 |
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 9,783 | 9,783 | ||||
Other comprehensive loss | (60) | (60) | ||||
Reclassification of deferred taxes | 1,135 | (1,135) | ||||
Cash dividends declared ($0.50 per share and $0.40 per share for the six months ended June 30, 2018 and June 30, 2017, respectively) | (4,656) | (4,656) | ||||
Share-based compensation | 135 | 135 | ||||
Allocation of ESOP shares (24,466 shares for the six months ended June 30, 2018 and June 30, 2017) | 504 | 245 | 749 | |||
Repurchase of company common stock (237,570 shares and 59,430 shares for the six months ended June 30, 2018 and June 30, 2017, respectively) | (2) | (7,302) | (7,304) | |||
Exercise of options for common stock (69,008 shares and 110,894 shares for the six months ended June 30, 2018 and June 30, 2017, respectively) | 1 | 1,197 | 1,198 | |||
Balance at Jun. 30, 2018 | 98 | 67,584 | (5,138) | 179,044 | (6,889) | 234,699 |
Balance at Mar. 31, 2018 | (6,878) | |||||
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 4,963 | |||||
Other comprehensive loss | (11) | (11) | ||||
Balance at Jun. 30, 2018 | $ 98 | $ 67,584 | $ (5,138) | $ 179,044 | $ (6,889) | $ 234,699 |
Consolidated Statements of Sto7
Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Consolidated Statements of Stockholders' Equity, Share Data | ||
Cash dividends declared per common share (in dollars per share) | $ 0.5 | $ 0.40 |
Common Stock | ||
Consolidated Statements of Stockholders' Equity, Share Data | ||
Allocation of ESOP shares, shares | 24,466 | 24,466 |
Repurchase of company common stock, shares | 237,570 | 59,430 |
Exercise of options for common stock, shares | 69,008 | 110,894 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows $ in Thousands | 6 Months Ended | |
Jun. 30, 2018USD ($) | Jun. 30, 2017USD ($) | |
Cash flows from operating activities: | ||
Net income | $ 9,783 | $ 8,622 |
Adjustments to reconcile net income to net cash from operating activities: | ||
Provision (reversal of provision) for loan losses | 69 | (52) |
Depreciation and amortization | 630 | 513 |
Deferred income tax expense | 421 | 379 |
Amortization of fees, discounts, and premiums, net | (235) | (235) |
Origination of loans held for sale | (6,612) | (16,006) |
Proceeds from sales of loans held for sale | 7,068 | 16,568 |
Gain on sale of loans, net | (53) | (126) |
Net gain on sale of real estate owned | (4) | |
Gain on sale of investment securities held to maturity | (45) | (281) |
ESOP expense | 749 | 775 |
Share-based compensation expense (benefit) | 135 | (11) |
Increase in accrued interest receivable | (53) | (37) |
Net increase in bank-owned life insurance | (430) | (453) |
Net increase in prepaid expenses and other assets | (71) | (171) |
Net increase (decrease) in accounts payable and accrued expenses | (2,963) | 666 |
Net increase in advance payments by borrowers for taxes and insurance | 76 | 257 |
Net decrease in income taxes receivable | 375 | 122 |
Net increase (decrease) in income taxes payable | (24) | 592 |
Net cash from operating activities | 8,816 | 11,122 |
Cash flows from investing activities: | ||
Purchases of investment securities held to maturity | (14,983) | (19,908) |
Purchases of investment securities available for sale | (2,970) | |
Principal repayments on investment securities held to maturity | 23,188 | 27,245 |
Principal repayments on investment securities available for sale | 106 | |
Proceeds from sale of investment securities held to maturity | 4,462 | 5,053 |
Loan originations, net of principal repayments on loans receivable | (47,315) | (68,203) |
Purchases of Federal Home Loan Bank stock | (2,672) | (483) |
Proceeds from redemption of Federal Home Loan Bank stock | 3,288 | 415 |
Purchases of Federal Reserve Bank stock | (3) | (8) |
Proceeds from sale of real estate owned | 50 | |
Purchases of premises and equipment | (271) | (1,313) |
Net cash from investing activities | (34,150) | (60,172) |
Cash flows from financing activities: | ||
Net increase in deposits | 49,888 | 39,357 |
Proceeds from advances from the Federal Home Loan Bank | 53,000 | 10,375 |
Repayments of advances from the Federal Home Loan Bank | (72,200) | (10,375) |
Repurchases of common stock | (6,106) | |
Cash dividends paid | (3,665) | (3,692) |
Net cash from financing activities | 20,917 | 35,665 |
Net decrease in cash and cash equivalents | (4,417) | (13,385) |
Cash and cash equivalents at beginning of the period | 32,089 | 61,273 |
Cash and cash equivalents at end of the period | 27,672 | 47,888 |
Cash paid for: | ||
Interest on deposits and borrowings | 6,475 | 4,308 |
Income taxes | 2,334 | 4,212 |
Supplemental disclosure of noncash investing and financing activities: | ||
Company stock acquired through stock swap and net settlement transactions | 1,198 | $ 1,925 |
Loans transferred to real estate owned | 46 | |
Dividends declared, not yet paid | $ 991 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jun. 30, 2018 | |
Summary of Significant Accounting Policies | |
Basis of Presentation | (1) Basis of Presentation The accompanying unaudited consolidated financial statements of Territorial Bancorp Inc. (the Company) have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. These interim condensed consolidated financial statements and notes should be read in conjunction with the Company’s consolidated financial statements and notes thereto filed as part of the Annual Report on Form 10-K for the year ended December 31, 2017. In the opinion of management, all adjustments necessary for a fair presentation have been made and consist only of normal recurring adjustments. Interim results of operations are not necessarily indicative of results to be expected for the year. . |
Organization
Organization | 6 Months Ended |
Jun. 30, 2018 | |
Organization | |
Organization | (2) Organization On July 10, 2009, Territorial Savings Bank completed a conversion from a mutual holding company to a stock holding company. As part of the conversion, Territorial Mutual Holding Company and Territorial Savings Group, Inc., the former holding companies for Territorial Savings Bank, ceased to exist as separate legal entities, and Territorial Bancorp Inc. became the holding company for Territorial Savings Bank. Upon completion of the conversion and reorganization, a special “liquidation account” was established in an amount equal to the total equity of Territorial Mutual Holding Company as of December 31, 2008. The liquidation account is to provide eligible account holders and supplemental eligible account holders who maintain their deposit accounts with Territorial Savings Bank after the conversion with a liquidation interest in the unlikely event of the complete liquidation of Territorial Savings Bank after the conversion. The balance of the liquidation account at December 31, 2017 was $11.0 million. On June 25, 2014, Territorial Savings Bank converted from a federal savings bank to a Hawaii state-chartered savings bank. On July 10, 2014, Territorial Savings Bank became a member of the Federal Reserve System. |
Recently Issued Accounting Pron
Recently Issued Accounting Pronouncements | 6 Months Ended |
Jun. 30, 2018 | |
Recently Issued Accounting Pronouncements | |
Recently Issued Accounting Pronouncements | (3) Recently Issued Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (FASB) amended the Revenue Recognition topic of the FASB Accounting Standards Codification (ASC). The amendment seeks to clarify the principles for recognizing revenue as well as to develop common revenue standards for U.S. generally accepted accounting principles and International Financial Reporting Standards. The Company reviewed all revenue sources to determine if the sources are in scope for this guidance. Net interest income from financial assets and liabilities are explicitly excluded from the scope of the amendment. The Company’s overall assessment of key in-scope revenue sources include service charges on deposit accounts, rental income from safe deposit boxes and commissions on insurance and annuity sales. Based on the Company’s analysis of these revenue sources, including the amount of revenue, the timing of services rendered and timing of payment for these services, there is no material change in the timing of revenue recognition under the amendment. The Company adopted this amendment as of January 1, 2018, using the modified retrospective approach. Since there was no material impact on the timing of revenue recognition, no adjustment to beginning retained earnings was deemed necessary. See Note 14, Revenue Recognition, for further information. In January 2016, the FASB amended the Financial Instruments – Overall topic of the FASB ASC. The amendment addresses several aspects of recognition, measurement, presentation and disclosure of financial instruments. Included are: (a) a requirement to measure equity investments at fair value, with changes in fair value recognized in net income, (b) a simplification of the impairment assessment of equity investments without readily determinable fair values, (c) the elimination of the requirement to disclose the methods and significant assumptions used to estimate the fair value of financial instruments measured at amortized cost on the balance sheet, and (d) a requirement to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes. The Company adopted this amendment as of January 1, 2018, and there was no material effect on its consolidated financial statements. In February 2016, the FASB amended the Leases topic of the FASB ASC. The primary effects of the amendment will be to recognize lease assets and lease liabilities on the balance sheet and to disclose certain information about leasing arrangements. The amendment is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company has several lease agreements for branch locations and equipment that will require recognition on the consolidated balance sheets upon adoption of the amendment. The Company will continue to evaluate the effects that the adoption of this amendment will have on its consolidated financial statements. In June 2016, the FASB amended various sections of the FASB ASC related to the accounting for credit losses on financial instruments. The amendment changes the threshold for recognizing losses from a “probable” to an “expected” model. The new model is referred to as the current expected credit loss model and applies to loans, leases, held-to-maturity investments, loan commitments and financial guarantees. The amendment requires the measurement of all expected credit losses for financial assets as of the reporting date (including historical experience, current conditions and reasonable and supportable forecasts) and enhanced disclosures that will help financial statement users understand the estimates and judgments used in estimating credit losses and evaluating the credit quality of an organization’s portfolio. The amendment is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The Company will apply the amendment’s provisions as a cumulative-effect adjustment to retained earnings at the beginning of the first period the amendment is effective. The Company is currently evaluating the effects that the adoption of this amendment will have on its consolidated financial statements by gathering the information that is necessary to make the calculations required by the amendment. This may result in increased credit losses on financial instruments recorded in the consolidated financial statements. In March 2017, the FASB amended the Compensation – Retirement Benefits topic of the FASB ASC. The amendment requires the service cost component of net benefit cost to be reported in the same line item as other compensation costs arising from employee services. It also requires the other components of net benefit cost to be reported in the income statement separately from the service cost component. The Company adopted this amendment as of January 1, 2018, and there was no material effect on its consolidated financial statements. In February 2018, the FASB amended the Income Statement – Reporting Comprehensive Income topic of the FASB ASC. Prior to the adoption of the amendment, deferred taxes previously included in accumulated other comprehensive income were not allowed to be adjusted for changes in tax rates. This amendment allows the reclassification of the tax effects resulting from the change in the federal corporate tax rate in the Tax Cuts and Jobs Act, which was passed in December 2017, from accumulated other comprehensive income to retained earnings. The amendment is effective for fiscal years beginning after December 15, 2018, with early adoption permitted in any period for which financial statements have not yet been issued. The Company adopted this amendment during the first quarter of 2018 with the reclassification of $1.1 million of deferred taxes from accumulated other comprehensive income to retained earnings. |
Cash and Cash Equivalents
Cash and Cash Equivalents | 6 Months Ended |
Jun. 30, 2018 | |
Cash and Cash Equivalents | |
Cash and Cash Equivalents | (4) Cash and Cash Equivalents The table below presents the balances of cash and cash equivalents: June 30, December 31, (Dollars in thousands) 2018 2017 Cash and due from banks $ 9,781 $ 9,114 Interest-earning deposits in other banks 17,891 22,975 Cash and cash equivalents $ 27,672 $ 32,089 Interest-earning deposits in other banks consist primarily of deposits at the Federal Reserve Bank of San Francisco. |
Investment Securities
Investment Securities | 6 Months Ended |
Jun. 30, 2018 | |
Investment Securities. | |
Investment Securities | (5) Investment Securities The amortized cost and fair values of investment securities are as follows: Amortized Gross Unrealized Estimated (Dollars in thousands) Cost Gains Losses Fair Value June 30, 2018: Available-for-sale: U.S. government-sponsored mortgage-backed securities $ 2,764 $ — $ (106) $ 2,658 Total $ 2,764 $ — $ (106) $ 2,658 Held-to-maturity: U.S. government-sponsored mortgage-backed securities $ 392,059 $ 2,049 $ (11,877) $ 382,231 Trust preferred securities 130 601 — 731 Total $ 392,189 $ 2,650 $ (11,877) $ 382,962 December 31, 2017: Available-for-sale: U.S. government-sponsored mortgage-backed securities $ 2,870 $ — $ (19) $ 2,851 Total $ 2,870 $ — $ (19) $ 2,851 Held-to-maturity: U.S. government-sponsored mortgage-backed securities $ 404,365 $ 6,056 $ (4,603) $ 405,818 Trust preferred securities 427 418 — 845 Total $ 404,792 $ 6,474 $ (4,603) $ 406,663 The amortized cost and estimated fair value of investment securities by maturity date at June 30, 2018 are shown below. Incorporated in the maturity schedule are mortgage-backed and trust preferred securities, which are allocated using the contractual maturity as a basis. Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties. Amortized Estimated (Dollars in thousands) Cost Fair Value Available-for-sale: Due within 5 years $ — $ — Due after 5 years through 10 years — — Due after 10 years 2,764 2,658 Total $ 2,764 $ 2,658 Held-to-maturity: Due within 5 years $ 7 $ 7 Due after 5 years through 10 years 76 76 Due after 10 years 392,106 382,879 Total $ 392,189 $ 382,962 Realized gains and losses and the proceeds from sales of held-to-maturity securities are shown in the table below. All sales of securities were U.S. government-sponsored mortgage-backed securities. Three Months Ended Six Months Ended June 30, June 30, (Dollars in thousands) 2018 2017 2018 2017 Proceeds from sales $ 4,462 $ 3,464 $ 4,462 $ 5,053 Gross gains 45 186 45 281 Gross losses — — — — The sale of these mortgage-backed securities, for which the Company had already collected a substantial portion of the outstanding purchased principal (at least 85%), is in accordance with the Investments – Debt and Equity Securities topic of the FASB ASC and does not taint management’s assertion of intent to hold remaining securities in the held-to-maturity portfolio to maturity. Investment securities with amortized costs of $311.4 million and $287.2 million at June 30, 2018 and December 31, 2017, respectively, were pledged to secure deposits made by state and local governments, securities sold under agreements to repurchase and transaction clearing accounts. Provided below is a summary of investment securities which were in an unrealized loss position at June 30, 2018 and December 31, 2017. The Company does not intend to sell held-to-maturity and available-for-sale securities until such time as the value recovers or the securities mature and it is not more likely than not that the Company will be required to sell the securities prior to recovery of value or the securities mature. Less Than 12 Months 12 Months or Longer Total Unrealized Unrealized Number of Unrealized Description of securities Fair Value Losses Fair Value Losses Securities Fair Value Losses (Dollars in thousands) June 30, 2018: Available-for-sale: U.S. government-sponsored mortgage-backed securities $ 2,658 $ 106 $ — $ — 1 $ 2,658 $ 106 Held-to-maturity: U.S. government-sponsored mortgage-backed securities $ 170,316 $ 3,782 $ 128,277 $ 8,095 88 $ 298,593 $ 11,877 December 31, 2017: Available-for-sale: U.S. government-sponsored mortgage-backed securities $ 2,851 $ 19 $ — $ — 1 $ 2,851 $ 19 Held-to-maturity: U.S. government-sponsored mortgage-backed securities $ 41,163 $ 299 $ 140,200 $ 4,304 49 $ 181,363 $ 4,603 Mortgage-Backed Securities. The unrealized losses on the Company’s investment in mortgage-backed securities were caused by increases in market interest rates subsequent to purchase. All of the mortgage-backed securities are guaranteed by Freddie Mac or Fannie Mae, which are U.S. government-sponsored enterprises, or Ginnie Mae, which is a U.S. government agency. Since the decline in market value is attributable to changes in interest rates and not credit quality, and the Company does not intend to sell these investments until maturity and it is not more likely than not that the Company will be required to sell such investments prior to recovery of its cost basis, the Company does not consider these investments to be other-than-temporarily impaired as of June 30, 2018 and December 31, 2017. Trust Preferred Securities . At June 30, 2018, the Company owned one trust preferred security, PreTSL XXIII. PreTSL XXIII has an amortized cost and a remaining cost basis of $130,000 at June 30, 2018. The trust preferred security represents an investment in a pool of debt obligations issued primarily by holding companies for Federal Deposit Insurance Corporation-insured financial institutions. This security is classified in the Company’s held-to-maturity investment portfolio. The trust preferred securities market is considered to be inactive as only seven transactions have occurred over the past 78 months in the same tranche of securities that we own and no new issuances of pooled trust preferred securities have occurred since 2007. We used a discounted cash flow model to determine whether this security is other-than-temporarily impaired. The assumptions used in preparing the discounted cash flow model include the following: estimated discount rates, estimated deferral and default rates on collateral, and estimated cash flows. Based on the Company’s review, the Company’s investment in PreTSL XXIII did not incur additional impairment during the six months ended June 30, 2018 and there is no accumulated other comprehensive loss related to noncredit factors. The table below provides a cumulative roll forward of credit losses recognized in earnings for debt securities held and not intended to be sold: Six Months Ended June 30, (Dollars in thousands) 2018 2017 Balance at the beginning of the period $ 2,403 $ 2,403 Credit losses on debt securities for which other-than-temporary impairment was not previously recognized — — Credit losses on debt securities which were sold — — Balance at the end of the period $ 2,403 $ 2,403 |
Loans Receivable and Allowance
Loans Receivable and Allowance for Loan Losses | 6 Months Ended |
Jun. 30, 2018 | |
Loans Receivable and Allowance for Loan Losses | |
Loans Receivable and Allowance for Loan Losses | (6) Loans Receivable and Allowance for Loan Losses The components of loans receivable are as follows: June 30, December 31, (Dollars in thousands) 2018 2017 Real estate loans: First mortgages: One- to four-family residential $ 1,490,465 $ 1,444,625 Multi-family residential 10,626 10,799 Construction, commercial and other 24,549 21,787 Home equity loans and lines of credit 12,074 12,882 Total real estate loans 1,537,714 1,490,093 Other loans: Loans on deposit accounts 281 274 Consumer and other loans 4,207 4,340 Total other loans 4,488 4,614 Less: Net unearned fees and discounts (3,196) (3,188) Allowance for loan losses (2,614) (2,548) Total unearned fees, discounts and allowance for loan losses (5,810) (5,736) Loans receivable, net $ 1,536,392 $ 1,488,971 The table below presents the activity in the allowance for loan losses by portfolio segment: Construction, Home Commercial Equity and Other Loans and Residential Mortgage Lines of Consumer (Dollars in thousands) Mortgage Loans Credit and Other Unallocated Totals Three months ended June 30, 2018: Balance, beginning of period $ 1,720 $ 530 $ 1 $ 49 $ 254 $ 2,554 Provision for loan losses 34 17 — 2 7 60 1,754 547 1 51 261 2,614 Charge-offs — — — (7) — (7) Recoveries 6 — — 1 — 7 Net recoveries (charge-offs) 6 — — (6) — — Balance, end of period $ 1,760 $ 547 $ 1 $ 45 $ 261 $ 2,614 Six months ended June 30, 2018: Balance, beginning of period $ 1,721 $ 539 $ 1 $ 55 $ 232 $ 2,548 Provision (reversal of provision) for loan losses 33 8 — (1) 29 69 1,754 547 1 54 261 2,617 Charge-offs — — — (12) — (12) Recoveries 6 — — 3 — 9 Net recoveries (charge-offs) 6 — — (9) — (3) Balance, end of period $ 1,760 $ 547 $ 1 $ 45 $ 261 $ 2,614 Construction, Home Commercial Equity and Other Loans and Residential Mortgage Lines of Consumer (Dollars in thousands) Mortgage Loans Credit and Other Unallocated Totals Three months ended June 30, 2017: Balance, beginning of period $ 1,603 $ 564 $ 1 $ 135 $ 237 $ 2,540 Provision (reversal of provision) for loan losses (45) (8) — (78) 8 (123) 1,558 556 1 57 245 2,417 Charge-offs — — — (7) — (7) Recoveries 44 — — 3 — 47 Net recoveries (charge-offs) 44 — — (4) — 40 Balance, end of period $ 1,602 $ 556 $ 1 $ 53 $ 245 $ 2,457 Six months ended June 30, 2017: Balance, beginning of period $ 1,594 $ 519 $ 2 $ 115 $ 222 $ 2,452 Provision (reversal of provision) for loan losses (56) 37 (1) (55) 23 (52) 1,538 556 1 60 245 2,400 Charge-offs (11) — — (12) — (23) Recoveries 75 — — 5 — 80 Net recoveries (charge-offs) 64 — — (7) — 57 Balance, end of period $ 1,602 $ 556 $ 1 $ 53 $ 245 $ Management considers the allowance for loan losses at June 30, 2018 to be at an appropriate level to provide for probable losses that can be reasonably estimated based on general and specific conditions at that date. While the Company uses the best information it has available to make evaluations, future adjustments to the allowance may be necessary if conditions differ substantially from the information used in making the evaluations. To the extent actual outcomes differ from the estimates, additional provisions for credit losses may be required that would reduce future earnings. In addition, as an integral part of their examination process, the bank regulators periodically review the allowance for loan losses and may require the Company to increase the allowance based on their analysis of information available at the time of their examination. The table below presents the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method: Construction, Home Commercial Equity and Other Loans and Residential Mortgage Lines of Consumer (Dollars in thousands) Mortgage Loans Credit and Other Unallocated Totals June 30, 2018: Allowance for loan losses: Ending allowance balance: Individually evaluated for impairment $ — $ — $ — $ — $ — $ — Collectively evaluated for impairment 1,760 547 1 45 261 2,614 Total ending allowance balance $ 1,760 $ 547 $ 1 $ 45 $ 261 $ 2,614 Loans: Ending loan balance: Individually evaluated for impairment $ 2,851 $ — $ 156 $ — $ — $ 3,007 Collectively evaluated for impairment 1,495,123 24,453 11,922 4,501 — 1,535,999 Total ending loan balance $ 1,497,974 $ 24,453 $ 12,078 $ 4,501 $ — $ 1,539,006 December 31, 2017: Allowance for loan losses: Ending allowance balance: Individually evaluated for impairment $ — $ — $ — $ — $ — $ — Collectively evaluated for impairment 1,721 539 1 55 232 2,548 Total ending allowance balance $ 1,721 $ 539 $ 1 $ 55 $ 232 $ 2,548 Loans: Ending loan balance: Individually evaluated for impairment $ 4,977 $ — $ 165 $ — $ — $ 5,142 Collectively evaluated for impairment 1,447,326 21,701 12,722 4,628 — 1,486,377 Total ending loan balance $ 1,452,303 $ 21,701 $ 12,887 $ 4,628 $ — $ 1,491,519 The table below presents the balance of impaired loans individually evaluated for impairment by class of loans: Unpaid Recorded Principal (Dollars in thousands) Investment Balance June 30, 2018: With no related allowance recorded: One- to four-family residential mortgages $ 2,851 $ 3,426 Home equity loans and lines of credit 156 226 Total $ 3,007 $ 3,652 December 31, 2017: With no related allowance recorded: One- to four-family residential mortgages $ 4,977 $ 5,897 Home equity loans and lines of credit 165 228 Total $ 5,142 $ 6,125 The table below presents the average recorded investment and interest income recognized on impaired loans by class of loans: For the Three Months Ended For the Six Months Ended June 30, June 30, Average Interest Average Interest Recorded Income Recorded Income (Dollars in thousands) Investment Recognized Investment Recognized 2018: With no related allowance recorded: One- to four-family residential mortgages $ 2,869 $ 13 $ 2,892 $ 27 Home equity loans and lines of credit 158 — 160 — Total $ 3,027 $ 13 $ 3,052 $ 27 2017: With no related allowance recorded: One- to four-family residential mortgages $ 4,205 $ 18 $ 4,239 $ 31 Home equity loans and lines of credit 178 — 180 — Total $ 4,383 $ 18 $ 4,419 $ 31 There were no loans individually evaluated for impairment with a related allowance for loan loss as of June 30, 2018 or December 31, 2017. Loans individually evaluated for impairment do not have an allocated allowance for loan loss because they were written down to fair value at the time of impairment. The Company had 12 nonaccrual loans with a book value of $2.1 million at June 30, 2018 and 17 nonaccrual loans with a book value of $4.2 million as of December 31, 2017. The Company collected interest on nonaccrual loans of $52,000 and $87,000 during the six months ended June 30, 2018 and 2017, respectively, but due to regulatory requirements, the Company recorded the interest as a reduction of principal. The Company would have recognized additional interest income of $69,000 and $114,000 during the six months ended June 30, 2018 and 2017, respectively, had the loans been accruing interest. The Company did not have any loans more than 90 days past due and still accruing interest as of June 30, 2018 and December 31, 2017. The table below presents the aging of loans and accrual status by class of loans: Loans More Than 90 Days 30 - 59 60 - 89 90 Days or Past Due Days Past Days Past Greater Total Past Loans Not Total Nonaccrual and Still (Dollars in thousands) Due Due Past Due Due Past Due Loans Loans Accruing June 30, 2018: One- to four-family residential mortgages $ — $ 1,298 $ 853 $ 2,151 $ 1,485,214 $ 1,487,365 $ 1,945 $ — Multi-family residential mortgages — — — — 10,609 10,609 — — Construction, commercial and other mortgages — — — — 24,453 24,453 — — Home equity loans and lines of credit — — 41 41 12,037 12,078 156 — Loans on deposit accounts — — — — 281 281 — — Consumer and other 3 — — 3 4,217 4,220 — — Total $ 3 $ 1,298 $ 894 $ 2,195 $ 1,536,811 $ 1,539,006 $ 2,101 $ — December 31, 2017: One- to four-family residential mortgages $ — $ 1,207 $ 1,589 $ 2,796 $ 1,438,725 $ 1,441,521 $ 4,062 $ — Multi-family residential mortgages — — — — 10,782 10,782 — — Construction, commercial and other mortgages — — — — 21,701 21,701 — — Home equity loans and lines of credit — — 41 41 12,846 12,887 165 — Loans on deposit accounts — — — — 274 274 — — Consumer and other 4 — — 4 4,350 4,354 — — Total $ 4 $ 1,207 $ 1,630 $ 2,841 $ 1,488,678 $ 1,491,519 $ 4,227 $ — The Company primarily uses the aging of loans and accrual status to monitor the credit quality of its loan portfolio. When a mortgage loan becomes seriously delinquent (90 days or more contractually past due), it displays weaknesses that may result in a loss. As a loan becomes more delinquent, the likelihood of the borrower repaying the loan decreases and the loan becomes more collateral-dependent. A mortgage loan becomes collateral-dependent when the proceeds for repayment can be expected to come only from the sale or operation of the collateral and not from borrower repayments. Generally, appraisals are obtained after a loan becomes collateral-dependent or is four months delinquent. The carrying value of collateral-dependent loans is adjusted to the fair value of the collateral less selling costs. Any commercial real estate, commercial, construction or equity loan that has a loan balance in excess of a specified amount is also periodically reviewed to determine whether the loan exhibits any weaknesses and is performing in accordance with its contractual terms. There were no loans modified in a troubled debt restructuring during the six months ended June 30, 2018 or 2017. There were no new troubled debt restructurings within the 12 months ended June 30, 2018 that subsequently defaulted. The table below summarizes troubled debt restructurings by class of loans: Number of Accrual Number of Nonaccrual (Dollars in thousands) Loans Status Loans Status Total June 30, 2018: One- to four-family residential mortgages 4 $ 906 4 $ 879 $ 1,785 Home equity loans and lines of credit — — 1 85 85 Total 4 $ 906 5 $ 964 $ 1,870 December 31, 2017: One- to four-family residential mortgages 4 $ 915 5 $ 1,074 $ 1,989 Home equity loans and lines of credit — — 1 92 92 Total 4 $ 915 6 $ 1,166 $ 2,081 There were no delinquent restructured loans as of June 30, 2018. One of the restructured loans, for $149,000, was more than 149 days delinquent and not accruing interest as of December 31, 2017. Restructurings include deferrals of interest and/or principal payments and temporary or permanent reductions in interest rates due to the financial difficulties of the borrowers. At June 30, 2018, we had no commitments to lend any additional funds to these borrowers. The Company had no real estate owned as of June 30, 2018 or December 31, 2017. There was one one- to four-family residential mortgage loan for $436,000 and one home equity loan for $41,000 in the process of foreclosure as of June 30, 2018, and three one- to four-family residential mortgage loans totaling $650,000 and one home equity loan for $41,000 in the process of foreclosure as of December 31, 2017. Nearly all of our real estate loans are collateralized by real estate located in the State of Hawaii. Loan-to-value ratios on these real estate loans generally do not exceed 80% at the time of origination. During the six months ended June 30, 2018 and 2017, the Company sold $7.0 million and $16.6 million, respectively, of mortgage loans held for sale and recognized gains of $53,000 and $126,000, respectively. The Company did not have any loans held for sale at June 30, 2018. The Company had one loan held for sale for $403,000 at December 31, 2017. The Company serviced loans for others of $32.3 million at June 30, 2018 and $35.5 million at December 31, 2017. Of these amounts, $1.5 million relate to securitizations for which the Company continues to hold the related mortgage-backed securities at June 30, 2018 and December 31, 2017. The amount of contractually specified servicing fees earned for the six-month periods ended June 30, 2018 and 2017 was $46,000 and $54,000, respectively. The amount of contractually specified servicing fees earned for the three-month periods ended June 30, 2018 and 2017 was $22,000 and $26,000, respectively. The fees are reported in service fees on loan and deposit accounts in the consolidated statements of income. |
Securities Sold Under Agreement
Securities Sold Under Agreements to Repurchase | 6 Months Ended |
Jun. 30, 2018 | |
Securities Sold Under Agreements to Repurchase | |
Securities Sold Under Agreements to Repurchase | (7) Securities Sold Under Agreements to Repurchase Securities sold under agreements to repurchase are treated as financings and the obligations to repurchase the identical securities sold are reflected as a liability with the securities collateralizing the agreements classified as an asset. Securities sold under agreements to repurchase are summarized as follows: June 30, 2018 December 31, 2017 Weighted Weighted Repurchase Average Repurchase Average (Dollars in thousands) Liability Rate Liability Rate Maturing: 1 year or less $ 20,000 1.66 % $ — — % Over 1 year to 2 years 10,000 1.65 25,000 1.66 Over 2 years to 3 years — — 5,000 1.65 Total $ 30,000 1.66 % $ 30,000 1.66 % Below is a summary comparing the carrying value and fair value of securities pledged to secure repurchase agreements, the repurchase liability, and the amount at risk at June 30, 2018. The amount at risk is the greater of the carrying value or fair value over the repurchase liability and refers to the potential loss to the Company if the secured lender fails to return the security at the maturity date of the agreement. All the agreements to repurchase are with JP Morgan Securities and the securities pledged are mortgage-backed securities issued and guaranteed by U.S. government-sponsored enterprises. The repurchase liability cannot exceed 90% of the fair value of securities pledged. In the event of a decline in the fair value of securities pledged to less than the required amount due to market conditions or principal repayments, the Company is obligated to pledge additional securities or other suitable collateral to cure the deficiency. Weighted Carrying Fair Average Value of Value of Repurchase Amount Months to (Dollars in thousands) Securities Securities Liability at Risk Maturity Maturing: Over 90 days $ 35,089 $ 34,008 $ 30,000 $ 5,089 11 |
Offsetting of Financial Liabili
Offsetting of Financial Liabilities | 6 Months Ended |
Jun. 30, 2018 | |
Offsetting of Financial Liabilities | |
Offsetting of Financial Liabilities | (8) Offsetting of Financial Liabilities The following table presents our securities sold under agreements to repurchase that are subject to a right of offset in the event of default. See Note 7, Securities Sold Under Agreements to Repurchase, for additional information. Net Amount of Gross Amount Not Offset in the Gross Amount Gross Amount Liabilities Balance Sheet of Recognized Offset in the Presented in the Financial Cash Collateral (Dollars in thousands) Liabilities Balance Sheet Balance Sheet Instruments Pledged Net Amount June 30, 2018: Securities sold under agreements to repurchase $ 30,000 $ — $ 30,000 $ 30,000 $ — $ — December 31, 2017: Securities sold under agreements to repurchase $ 30,000 $ — $ 30,000 $ 30,000 $ — $ — |
Employee Benefit Plans
Employee Benefit Plans | 6 Months Ended |
Jun. 30, 2018 | |
Employee Benefit Plans | |
Employee Benefit Plans | (9) Employee Benefit Plans The Company has a noncontributory defined benefit pension plan (Pension Plan) that covers most employees with at least one year of service. Effective December 31, 2008, under approved changes to the Pension Plan, there were no further accruals of benefits for any participants and benefits will not increase with any additional years of service. Net periodic benefit cost, subsequent to December 31, 2008, has not been significant and is not disclosed in the table below. The Company made a $1.0 million contribution to the Pension Plan during the second quarter of 2018. The Company also sponsors a Supplemental Employee Retirement Plan (SERP), a noncontributory supplemental retirement benefit plan, which covers certain current and former employees of the Company for amounts in addition to those provided under the Pension Plan. The components of net periodic benefit cost were as follows: SERP SERP Three Months Ended Six Months Ended June 30, June 30, (Dollars in thousands) 2018 2017 2018 2017 Net periodic benefit cost for the period: Service cost $ 20 $ 10 $ 40 $ 20 Interest cost 38 35 75 70 Expected return on plan assets — — — — Amortization of prior service cost — — — — Recognized actuarial loss — — — — Recognized curtailment loss — — — — Net periodic benefit cost $ 58 $ 45 $ 115 $ 90 The components of net periodic benefit cost other than the service cost component are included in other general and administrative expenses in the consolidated statements of income. In prior years, these amounts were included in salaries and employee benefits along with the service cost component. The prior year amounts in the consolidated statements of income have been adjusted for comparability purposes. The Company used the amounts disclosed in prior years to estimate the amount of the required adjustment. |
Employee Stock Ownership Plan
Employee Stock Ownership Plan | 6 Months Ended |
Jun. 30, 2018 | |
Employee Stock Ownership Plan | |
Employee Stock Ownership Plan | |
Employee Stock Ownership Plan | (10) Employee Stock Ownership Plan Effective January 1, 2009, Territorial Savings Bank adopted an Employee Stock Ownership Plan (ESOP) for eligible employees. The ESOP borrowed $9.8 million from the Company and used those funds to acquire 978,650 shares, or 8%, of the total number of shares issued by the Company in its initial public offering. The shares were acquired at a price of $10.00 per share. The loan is secured by the shares purchased with the loan proceeds and will be repaid by the ESOP over the 20-year term of the loan with funds from Territorial Savings Bank’s contributions to the ESOP and dividends payable on the shares. The interest rate on the ESOP loan is an adjustable rate equal to the prime rate, as published in The Wall Street Journal. The interest rate adjusts annually and will be the prime rate on the first business day of the calendar year. Shares purchased by the ESOP are held by a trustee in an unallocated suspense account, and shares are released annually from the suspense account on a pro-rata basis as principal and interest payments are made by the ESOP to the Company. The trustee allocates the shares released among participants on the basis of each participant’s proportional share of compensation relative to all participants. As shares are committed to be released from the suspense account, Territorial Savings Bank reports compensation expense based on the average fair value of shares released with a corresponding credit to stockholders’ equity. The shares committed to be released are considered outstanding for earnings per share computations. Compensation expense recognized for the three months ended June 30, 2018 and 2017 amounted to $435,000 and $305,000, respectively. Compensation expense recognized for the six months ended June 30, 2018 and 2017 amounted to $811,000 and $626,000, respectively. Shares held by the ESOP trust were as follows: June 30, December 31, 2018 2017 Allocated shares 422,378 397,912 Unearned shares 513,795 538,261 Total ESOP shares 936,173 936,173 Fair value of unearned shares, in thousands $ 15,928 $ 16,616 The ESOP restoration plan is a nonqualified plan that provides supplemental benefits to certain executives who are prevented from receiving the full benefits contemplated by the ESOP’s benefit formula. The supplemental cash payments consist of payments representing shares that cannot be allocated to the participants under the ESOP due to IRS limitations imposed on tax-qualified plans. We accrue for these benefits over the period during which employees provide services to earn these benefits. For the three months ended June 30, 2018 we accrued $16,000 for the ESOP restoration plan and for the three months ended June 30, 2017, we reversed $53,000 for the ESOP restoration plan. For the six months ended June 30, 2018 and 2017, we accrued $111,000 and $64,000, respectively, for the ESOP restoration plan. |
Share-Based Compensation
Share-Based Compensation | 6 Months Ended |
Jun. 30, 2018 | |
2010 Equity Incentive Plan | |
Share-Based Compensation | |
Share-Based Compensation | (11) Share-Based Compensation On August 19, 2010, Territorial Bancorp Inc. adopted the 2010 Equity Incentive Plan, which provides for awards of stock options and restricted stock to key officers and outside directors. In accordance with the Compensation – Stock Compensation topic of the FASB ASC, the cost of the 2010 Equity Incentive Plan is based on the fair value of the awards on the grant date. The fair value of restricted stock is based on the closing price of the Company’s stock on the grant date. The fair value of stock options is estimated using a Black-Scholes option pricing model using assumptions for dividend yield, stock price volatility, risk-free interest rate and option term. These assumptions are based on our judgments regarding future events, are subjective in nature, and cannot be determined with precision. The cost of the awards will be recognized on a straight-line basis over the three, five- or six-year vesting period during which participants are required to provide services in exchange for the awards. The Company recognized compensation expense, measured as the fair value of the share-based award on the date of grant, on a straight-line basis over the vesting period. Share-based compensation is recorded in the statement of income as a component of salaries and employee benefits with a corresponding increase in shareholders’ equity. The table below presents information on compensation expense and the related tax benefit for all share-based awards: Three Months Ended Six Months Ended June 30, June 30, (In thousands) 2018 2017 2018 2017 Compensation expense $ 69 $ 28 $ 135 $ 37 Income tax benefit 19 11 37 15 Shares of our common stock issued under the 2010 Equity Incentive Plan shall come from authorized shares. The maximum number of shares that will be awarded under the plan will be 1,862,637 shares. Stock Options The table below presents the stock option activity for the six months ended June 30, 2018 and 2017: Weighted Aggregate Average Remaining Intrinsic Exercise Contractual Value Options Price Life (years) (in thousands) Options outstanding at December 31, 2017 411,543 $ 17.48 2.73 $ 5,509 Granted — — — — Exercised 69,008 17.36 — 920 Forfeited — — — — Expired — — — — Options outstanding at June 30, 2018 342,535 $ 17.51 2.24 $ 4,621 Options outstanding at December 31, 2016 706,430 $ 17.43 3.70 $ 10,884 Granted — — — — Exercised 110,894 17.36 — 1,670 Forfeited — — — — Expired — — — — Options outstanding at June 30, 2017 595,536 $ 17.45 3.21 $ 8,185 Options vested and exercisable at June 30, 2018 $ $ 4,615 The following summarizes certain stock option activity of the Company: For the Three Months Ended For the Six Months Ended June 30, June 30, (In thousands) 2018 2017 2018 2017 Intrinsic value of stock options exercised $ 683 $ 797 $ 920 $ 1,670 Proceeds received from stock options exercised 885 971 1,198 1,925 Tax benefits realized from stock options exercised 178 287 220 594 Total fair value of stock options that vested — — — — During the six months ended June 30, 2018, we issued 29,979 shares of common stock, net, in exchange for 69,008 stock options and 39,029 shares of common stock. Pursuant to the provisions of our equity incentive plan, optionees are permitted to use the value of our common stock they own in a stock swap transaction or net settlement to pay the exercise price of stock options. As of June 30, 2018, the Company had $1,000 of unrecognized compensation costs related to the stock option plan that will be amortized over a three-year vesting period. Restricted Stock Restricted stock awards are accounted for as fixed grants using the fair value of the Company’s stock at the time of grant. Unvested restricted stock may not be disposed of or transferred during the vesting period. Restricted stock carries the right to receive dividends, although dividends attributable to restricted stock are retained by the Company until the shares vest, at which time they are paid to the award recipient. The table below presents the restricted stock activity: Weighted Average Grant Restricted Date Fair Stock Value Nonvested at December 31, 2017 10,806 $ 29.16 Granted 10,019 30.73 Vested 3,201 — Forfeited — — Nonvested at June 30, 2018 17,624 $ 29.92 Nonvested at December 31, 2016 2,400 $ 26.23 Granted 9,604 29.53 Vested — — Forfeited — — Nonvested at June 30, 2017 12,004 $ 28.87 During the six months ended June 30, 2018, the Company issued 10,019 shares of restricted stock to certain members of executive management under the 2010 Equity Incentive Plan. The fair value of the restricted stock is based on the value of the Company’s stock on the date of grant. Restricted stock will vest over three years from the date of grant. As of June 30, 2018, the Company had $460,000 of unrecognized compensation costs related to restricted stock. During the six months ended June 30, 2018, the Company issued 12,018 performance-based restricted stock units (PRSUs) to certain members of executive management under the 2010 Equity Incentive Plan. These PRSUs will vest in the first quarter of 2021 after our Compensation Committee determines whether a performance condition that compares the Company’s return on average equity to the SNL Bank Index is achieved. Depending on the Company’s performance, the actual number of these PRSUs that are issued at the end of the vesting period can vary between 0% to 150% of the target award. For the PRSUs, an estimate is made of the number of shares expected to vest based on the probability that the performance criteria will be achieved to determine the amount of compensation expense to be recognized. This estimate is re-evaluated quarterly and total compensation expense is adjusted for any change in the current period. The table below presents the PRSUs that will vest on a performance condition: Performance- Based Restricted Stock Units Weighted Based on a Average Grant Performance Date Fair Condition Value Nonvested at December 31, 2017 11,520 $ 29.53 Granted 12,018 30.73 Vested — — Forfeited — — Nonvested at June 30, 2018 23,538 $ 30.14 The fair value of these PRSUs is based on the fair value of the Company’s stock on the date of grant. As of June 30, 2018, the Company had $253,000 of unrecognized compensation costs related to these PRSUs. Performance will be measured over a three-year performance period and will be cliff vested. During the six months ended June 30, 2018, the Company issued 3,005 of PRSUs to certain members of executive management under the 2010 Equity Incentive Plan. These PRSUs will vest in the first quarter of 2021 after our Compensation Committee determines whether a market condition that compares the Company’s total stock return to the SNL Bank Index is achieved. The number of shares that will be expensed will not be adjusted for performance. The fair value of these PRSUs is based on a Monte Carlo valuation of the Company’s stock on the date of grant. The assumptions which were used in the Monte Carlo valuation of the PRSUs are: Grant date: March 8, 2018 Performance period: January 1, 2018 to December 31, 2020 2.82 year risk-free rate on grant date: 2.39% December 31, 2017 closing price: $30.87 Closing stock price on the date of grant: $30.73 Annualized volatility (based on 2.82 year historical volatility as of the grant date): 16.6% The table below presents the PRSUs that will vest on a market condition: Performance- Based Restricted Monte Carlo Stock Units Valuation of Based on a the Company's Market Condition Stock Nonvested at December 31, 2017 2,879 $ 24.44 Granted 3,005 28.32 Vested — — Forfeited — — Nonvested at June 30, 2018 5,884 $ 26.42 As of June 30, 2018, the Company had $80,000 of unrecognized compensation costs related to the PRSUs that are based on a market condition. Performance will be measured over a three-year performance period and will be cliff vested. |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share | |
Earnings Per Share | (12) Earnings Per Share Holders of unvested restricted stock receive nonforfeitable dividends at the same rate as common shareholders and they both share equally in undistributed earnings. Unvested restricted stock awards that contain nonforfeitable rights to dividends or dividend equivalents are considered to be participating securities in the earnings per share computation using the two-class method. Under the two-class method, earnings are allocated to common shareholders and participating securities according to their respective rights to earnings. The table below presents the information used to compute basic and diluted earnings per share: Three Months Ended Six Months Ended June 30, June 30, (Dollars in thousands, except per share data) 2018 2017 2018 2017 Net income $ 4,963 $ 4,301 $ 9,783 $ 8,622 Income allocated to participating securities (27) (4) (42) (7) Net income available to common shareholders $ 4,936 $ 4,297 $ 9,741 $ 8,615 Weighted-average number of shares used in: Basic earnings per share 9,219,859 9,255,739 9,251,999 9,235,553 Dilutive common stock equivalents: Stock options and restricted stock units 174,172 284,018 187,619 303,990 Diluted earnings per share 9,394,031 9,539,757 9,439,618 9,539,543 Net income per common share, basic $ 0.54 $ 0.46 $ 1.05 $ 0.93 Net income per common share, diluted $ 0.53 $ 0.45 $ 1.03 $ 0.90 |
Other Comprehensive Income and
Other Comprehensive Income and Loss | 6 Months Ended |
Jun. 30, 2018 | |
Other Comprehensive Income and Loss | |
Other Comprehensive Income and Loss | (13) Other Comprehensive Income and Loss The table below presents the changes in the components of accumulated other comprehensive income and loss, net of taxes: Unfunded Unrealized Pension Loss on (Dollars in thousands) Liability Securities Total Three months ended June 30, 2018 Balances at beginning of period $ 6,783 $ 95 $ 6,878 Other comprehensive loss, net of taxes — 11 11 Net current period other comprehensive loss — 11 11 Balances at end of period $ 6,783 $ 106 $ 6,889 Three months ended June 30, 2017 Balances at beginning of period $ 5,284 $ 30 $ 5,314 Other comprehensive loss, net of taxes — 15 15 Net current period other comprehensive loss — 15 15 Balances at end of period $ 5,284 $ 45 $ 5,329 Six months ended June 30, 2018 Balances at beginning of period $ 5,657 $ 37 $ 5,694 Other comprehensive loss, net of taxes — 60 60 Amounts reclassified from accumulated other comprehensive loss 1,126 9 1,135 Net current period other comprehensive loss 1,126 69 1,195 Balances at end of period $ 6,783 $ 106 $ 6,889 Six months ended June 30, 2017 Balances at beginning of period $ 5,284 $ 32 $ 5,316 Other comprehensive loss, net of taxes — 13 13 Net current period other comprehensive loss — 13 13 Balances at end of period $ 5,284 $ 45 $ 5,329 The reclassification from accumulated other comprehensive loss for the six months ended June 30, 2018, was related to the FASB ASC amendment to the Income Statement – Reporting Comprehensive Income topic issued in February 2018. This amendment allowed the reclassification of deferred taxes in accumulated other comprehensive income to retained earnings. See Note 3, Recently Issued Accounting Pronouncements, for additional information. The table below presents the tax effect on each component of accumulated other comprehensive income and loss: Three Months Ended June 30, 2018 2017 Pretax After Tax Pretax After Tax (Dollars in thousands) Amount Tax Amount Amount Tax Amount Unrealized loss on securities $ 16 $ (5) $ 11 $ 25 $ (10) $ 15 Total $ 16 $ (5) $ 11 $ 25 $ (10) $ 15 Six Months Ended June 30, 2018 2017 Pretax After Tax Pretax After Tax (Dollars in thousands) Amount Tax Amount Amount Tax Amount Unrealized loss on securities $ 82 $ (22) $ 60 $ 22 $ (9) $ 13 Total $ 82 $ (22) $ 60 $ 22 $ (9) $ 13 |
Revenue Recognition
Revenue Recognition | 6 Months Ended |
Jun. 30, 2018 | |
Revenue Recognition | |
Revenue Recognition | (14) Revenue Recognition The Company’s contracts with customers are generally short-term in nature, with cycles of one year or less. These can range from an immediate term for services such as wire transfers, foreign currency exchanges and cashier’s check purchases, to several days for services such as processing annuity and mutual fund sales. Some contracts may be of an ongoing nature, such as providing deposit account services, including ATM access, check processing, account analysis and check ordering. However, provision of an assessable service and payment for such service is usually concurrent or closely timed. Contracts related to financial instruments, such as loans, investments and debt, are excluded from the scope of this reporting requirement. After analyzing the Company’s revenue sources, including the amount of revenue received, the timing of services rendered and the timing of payment for these services, the Company has determined that the rendering of services and the payment for such services are generally closely matched. Any differences are not material to the Company’s consolidated financial statements. Accordingly, the Company generally records income when payment for services is received. Revenue from contracts with customers is reported in service fees on loan and deposit accounts and in other noninterest income in the consolidated statement of income. The table below reconciles the revenue from contracts with customers and other revenue reported in those line items: Service Fees on Loan and Deposit (Dollars in thousands) Accounts Other Total Three months ended June 30, 2018 Revenue from contracts with customers $ 391 $ 52 $ 443 Other revenue 96 27 123 Total $ 487 $ 79 $ 566 Three months ended June 30, 2017 Revenue from contracts with customers $ 348 $ 49 $ 397 Other revenue 159 27 186 Total $ 507 $ 76 $ 583 Six months ended June 30, 2018 Revenue from contracts with customers $ 711 $ 93 $ 804 Other revenue 191 55 246 Total $ 902 $ 148 $ 1,050 Six months ended June 30, 2017 Revenue from contracts with customers $ 724 $ 103 $ 827 Other revenue 339 55 394 Total $ 1,063 $ 158 $ 1,221 |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value of Financial Instruments | |
Fair Value of Financial Instruments | (15) Fair Value of Financial Instruments In accordance with the Fair Value Measurements and Disclosures topic of the FASB ASC, the Company groups its financial assets and liabilities valued at fair value into three levels based on the markets in which the financial assets and liabilities are traded and the reliability of the assumptions used to determine fair value as follows: · Level 1 — Valuation is based upon quoted prices (unadjusted) for identical assets or liabilities traded in active markets. A quoted price in an active market provides the most reliable evidence of fair value and shall be used to measure fair value whenever available. · Level 2 — Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market. · Level 3 — Valuation is generated from model-based techniques that use significant assumptions not observable in the market. These unobservable assumptions reflect management’s own estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques include use of discounted cash flow models and similar techniques that require the use of significant judgment or estimation. In accordance with the Fair Value Measurements and Disclosures topic, the Company bases its fair values on the price that it would expect to receive if an asset were sold or the price that it would expect to pay to transfer a liability in an orderly transaction between market participants at the measurement date. Also as required, the Company maximizes the use of observable inputs and minimizes the use of unobservable inputs when developing fair value measurements. The Company uses fair value measurements to determine fair value disclosures. Investment securities held for sale and derivatives are recorded at fair value on a recurring basis. From time to time, the Company may be required to record other financial assets at fair value on a nonrecurring basis, such as loans held for sale, impaired loans and investments, and mortgage servicing assets. These nonrecurring fair value adjustments typically involve application of the lower of cost or fair value accounting or write-downs of individual assets. Investment Securities Available for Sale. The estimated fair values of U.S. government-sponsored mortgage-backed securities are considered Level 2 inputs because the valuation for investment securities utilized pricing models that varied based on asset class and included trade, bid and other observable market information. Interest Rate Contracts. The Company may enter into interest rate lock commitments with borrowers on loans intended to be sold. To manage interest rate risk on the lock commitments, the Company may also enter into forward loan sale commitments. The interest rate lock commitments and forward loan sale commitments are treated as derivatives and are recorded at their fair value determined by referring to prices quoted in the secondary market for similar contracts. Interest rate contracts that are classified as assets are included with prepaid expenses and other assets on the consolidated balance sheet while interest rate contracts that are classified as liabilities are included with accounts payable and accrued expenses. The estimated fair values of the Company’s financial instruments are as follows: Carrying Fair Value Measurements Using (Dollars in thousands) Amount Fair Value Level 1 Level 2 Level 3 June 30, 2018 Assets Cash and cash equivalents $ 27,672 $ 27,672 $ 27,672 $ — $ — Investment securities available for sale 2,658 2,658 — 2,658 — Investment securities held to maturity 392,189 382,962 — 382,231 731 Loans receivable, net 1,536,392 1,509,423 — — 1,509,423 FHLB stock 5,925 5,925 — 5,925 — FRB stock 3,106 3,106 — 3,106 — Accrued interest receivable 5,195 5,195 8 1,014 4,173 Interest rate contracts 2 2 — 2 — Liabilities Deposits 1,647,183 1,643,537 — 1,267,555 375,982 Advances from the Federal Home Loan Bank 88,000 87,327 — 87,327 — Securities sold under agreements to repurchase 30,000 29,736 — 29,736 — Accrued interest payable 370 370 — 112 258 Interest rate contracts 2 2 — 2 — December 31, 2017 Assets Cash and cash equivalents $ 32,089 $ 32,089 $ 32,089 $ — $ — Investment securities available for sale 2,851 2,851 — 2,851 — Investment securities held to maturity 404,792 406,663 — 405,818 845 Loans held for sale 403 414 — 414 — Loans receivable, net 1,488,971 1,505,097 — — 1,505,097 FHLB stock 6,541 6,541 — 6,541 — FRB stock 3,103 3,103 — 3,103 — Accrued interest receivable 5,142 5,142 7 1,045 4,090 Interest rate contracts 8 8 — 8 — Liabilities Deposits 1,597,295 1,595,992 — 1,285,070 310,922 Advances from the Federal Home Loan Bank 107,200 107,019 — 107,019 — Securities sold under agreements to repurchase 30,000 29,846 — 29,846 — Accrued interest payable 575 575 — 115 460 Interest rate contracts 8 8 — 8 — At June 30, 2018 and December 31, 2017, neither the commitment fees received on commitments to extend credit nor the fair value thereof was material to the consolidated financial statements of the Company. The table below presents the balance of assets and liabilities measured at fair value on a recurring basis: (Dollars in thousands) Level 1 Level 2 Level 3 Total June 30, 2018 Interest rate contracts — assets $ — $ 2 $ — $ 2 Interest rate contracts — liabilities — (2) — (2) Available-for-sale investments — 2,658 — 2,658 December 31, 2017 Interest rate contracts — assets $ — $ 8 $ — $ 8 Interest rate contracts — liabilities — (8) — (8) Available-for-sale investments — 2,851 — 2,851 The table below presents the balance of assets measured at fair value on a nonrecurring basis as of December 31, 2017 and the related losses for the year ended December 31, 2017. There were no assets measured at fair value as of June 30, 2018. Fair Value (Dollars in thousands) Adjustment Date Level 1 Level 2 Level 3 Total Total Losses December 31, 2017 Impaired loans 3/31/2017 $ — $ 87 $ — $ 87 $ (11) The fair value of impaired loans is determined using the value of collateral less estimated selling costs. Gains and losses on impaired loans are included in the provision for loan losses in the consolidated statements of income. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2018 | |
Subsequent Events | |
Subsequent Events | (16) Subsequent Events On July 26, 2018, the Board of Directors of Territorial Bancorp Inc. declared a quarterly cash dividend of $0.22 per share of common stock. The dividend is expected to be paid on August 23, 2018 to stockholders of record as of August 9, 2018. |
Cash and Cash Equivalents (Tabl
Cash and Cash Equivalents (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Cash and Cash Equivalents | |
Schedule of balances of cash and cash equivalents | June 30, December 31, (Dollars in thousands) 2018 2017 Cash and due from banks $ 9,781 $ 9,114 Interest-earning deposits in other banks 17,891 22,975 Cash and cash equivalents $ 27,672 $ 32,089 |
Investment Securities (Tables)
Investment Securities (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Investment Securities. | |
Schedule of amortized cost and fair values of investment securities | Amortized Gross Unrealized Estimated (Dollars in thousands) Cost Gains Losses Fair Value June 30, 2018: Available-for-sale: U.S. government-sponsored mortgage-backed securities $ 2,764 $ — $ (106) $ 2,658 Total $ 2,764 $ — $ (106) $ 2,658 Held-to-maturity: U.S. government-sponsored mortgage-backed securities $ 392,059 $ 2,049 $ (11,877) $ 382,231 Trust preferred securities 130 601 — 731 Total $ 392,189 $ 2,650 $ (11,877) $ 382,962 December 31, 2017: Available-for-sale: U.S. government-sponsored mortgage-backed securities $ 2,870 $ — $ (19) $ 2,851 Total $ 2,870 $ — $ (19) $ 2,851 Held-to-maturity: U.S. government-sponsored mortgage-backed securities $ 404,365 $ 6,056 $ (4,603) $ 405,818 Trust preferred securities 427 418 — 845 Total $ 404,792 $ 6,474 $ (4,603) $ 406,663 |
Schedule of amortized cost and estimated fair value of investment securities by maturity | Amortized Estimated (Dollars in thousands) Cost Fair Value Available-for-sale: Due within 5 years $ — $ — Due after 5 years through 10 years — — Due after 10 years 2,764 2,658 Total $ 2,764 $ 2,658 Held-to-maturity: Due within 5 years $ 7 $ 7 Due after 5 years through 10 years 76 76 Due after 10 years 392,106 382,879 Total $ 392,189 $ 382,962 |
Schedule of realized gains and losses and proceeds from sales of securities held to maturity | Three Months Ended Six Months Ended June 30, June 30, (Dollars in thousands) 2018 2017 2018 2017 Proceeds from sales $ 4,462 $ 3,464 $ 4,462 $ 5,053 Gross gains 45 186 45 281 Gross losses — — — — |
Summary of investment securities in an unrealized loss position | Less Than 12 Months 12 Months or Longer Total Unrealized Unrealized Number of Unrealized Description of securities Fair Value Losses Fair Value Losses Securities Fair Value Losses (Dollars in thousands) June 30, 2018: Available-for-sale: U.S. government-sponsored mortgage-backed securities $ 2,658 $ 106 $ — $ — 1 $ 2,658 $ 106 Held-to-maturity: U.S. government-sponsored mortgage-backed securities $ 170,316 $ 3,782 $ 128,277 $ 8,095 88 $ 298,593 $ 11,877 December 31, 2017: Available-for-sale: U.S. government-sponsored mortgage-backed securities $ 2,851 $ 19 $ — $ — 1 $ 2,851 $ 19 Held-to-maturity: U.S. government-sponsored mortgage-backed securities $ 41,163 $ 299 $ 140,200 $ 4,304 49 $ 181,363 $ 4,603 |
Cumulative roll forward of credit losses recognized in earnings for debt securities held and not intended to be sold | Six Months Ended June 30, (Dollars in thousands) 2018 2017 Balance at the beginning of the period $ 2,403 $ 2,403 Credit losses on debt securities for which other-than-temporary impairment was not previously recognized — — Credit losses on debt securities which were sold — — Balance at the end of the period $ 2,403 $ 2,403 |
Loans Receivable and Allowanc27
Loans Receivable and Allowance for Loan Losses (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Loans Receivable and Allowance for Loan Losses | |
Schedule of components of loans receivable | June 30, December 31, (Dollars in thousands) 2018 2017 Real estate loans: First mortgages: One- to four-family residential $ 1,490,465 $ 1,444,625 Multi-family residential 10,626 10,799 Construction, commercial and other 24,549 21,787 Home equity loans and lines of credit 12,074 12,882 Total real estate loans 1,537,714 1,490,093 Other loans: Loans on deposit accounts 281 274 Consumer and other loans 4,207 4,340 Total other loans 4,488 4,614 Less: Net unearned fees and discounts (3,196) (3,188) Allowance for loan losses (2,614) (2,548) Total unearned fees, discounts and allowance for loan losses (5,810) (5,736) Loans receivable, net $ 1,536,392 $ 1,488,971 |
Schedule of activity in allowance for loan losses by portfolio segment | Construction, Home Commercial Equity and Other Loans and Residential Mortgage Lines of Consumer (Dollars in thousands) Mortgage Loans Credit and Other Unallocated Totals Three months ended June 30, 2018: Balance, beginning of period $ 1,720 $ 530 $ 1 $ 49 $ 254 $ 2,554 Provision for loan losses 34 17 — 2 7 60 1,754 547 1 51 261 2,614 Charge-offs — — — (7) — (7) Recoveries 6 — — 1 — 7 Net recoveries (charge-offs) 6 — — (6) — — Balance, end of period $ 1,760 $ 547 $ 1 $ 45 $ 261 $ 2,614 Six months ended June 30, 2018: Balance, beginning of period $ 1,721 $ 539 $ 1 $ 55 $ 232 $ 2,548 Provision (reversal of provision) for loan losses 33 8 — (1) 29 69 1,754 547 1 54 261 2,617 Charge-offs — — — (12) — (12) Recoveries 6 — — 3 — 9 Net recoveries (charge-offs) 6 — — (9) — (3) Balance, end of period $ 1,760 $ 547 $ 1 $ 45 $ 261 $ 2,614 Construction, Home Commercial Equity and Other Loans and Residential Mortgage Lines of Consumer (Dollars in thousands) Mortgage Loans Credit and Other Unallocated Totals Three months ended June 30, 2017: Balance, beginning of period $ 1,603 $ 564 $ 1 $ 135 $ 237 $ 2,540 Provision (reversal of provision) for loan losses (45) (8) — (78) 8 (123) 1,558 556 1 57 245 2,417 Charge-offs — — — (7) — (7) Recoveries 44 — — 3 — 47 Net recoveries (charge-offs) 44 — — (4) — 40 Balance, end of period $ 1,602 $ 556 $ 1 $ 53 $ 245 $ 2,457 Six months ended June 30, 2017: Balance, beginning of period $ 1,594 $ 519 $ 2 $ 115 $ 222 $ 2,452 Provision (reversal of provision) for loan losses (56) 37 (1) (55) 23 (52) 1,538 556 1 60 245 2,400 Charge-offs (11) — — (12) — (23) Recoveries 75 — — 5 — 80 Net recoveries (charge-offs) 64 — — (7) — 57 Balance, end of period $ 1,602 $ 556 $ 1 $ 53 $ 245 $ |
Schedule of balance in allowance for loan losses and recorded investment in loans by portfolio segment and based on impairment method | Construction, Home Commercial Equity and Other Loans and Residential Mortgage Lines of Consumer (Dollars in thousands) Mortgage Loans Credit and Other Unallocated Totals June 30, 2018: Allowance for loan losses: Ending allowance balance: Individually evaluated for impairment $ — $ — $ — $ — $ — $ — Collectively evaluated for impairment 1,760 547 1 45 261 2,614 Total ending allowance balance $ 1,760 $ 547 $ 1 $ 45 $ 261 $ 2,614 Loans: Ending loan balance: Individually evaluated for impairment $ 2,851 $ — $ 156 $ — $ — $ 3,007 Collectively evaluated for impairment 1,495,123 24,453 11,922 4,501 — 1,535,999 Total ending loan balance $ 1,497,974 $ 24,453 $ 12,078 $ 4,501 $ — $ 1,539,006 December 31, 2017: Allowance for loan losses: Ending allowance balance: Individually evaluated for impairment $ — $ — $ — $ — $ — $ — Collectively evaluated for impairment 1,721 539 1 55 232 2,548 Total ending allowance balance $ 1,721 $ 539 $ 1 $ 55 $ 232 $ 2,548 Loans: Ending loan balance: Individually evaluated for impairment $ 4,977 $ — $ 165 $ — $ — $ 5,142 Collectively evaluated for impairment 1,447,326 21,701 12,722 4,628 — 1,486,377 Total ending loan balance $ 1,452,303 $ 21,701 $ 12,887 $ 4,628 $ — $ 1,491,519 |
Schedule of balance of impaired loans individually evaluated for impairment by class of loans | Unpaid Recorded Principal (Dollars in thousands) Investment Balance June 30, 2018: With no related allowance recorded: One- to four-family residential mortgages $ 2,851 $ 3,426 Home equity loans and lines of credit 156 226 Total $ 3,007 $ 3,652 December 31, 2017: With no related allowance recorded: One- to four-family residential mortgages $ 4,977 $ 5,897 Home equity loans and lines of credit 165 228 Total $ 5,142 $ 6,125 |
Schedule of average recorded investment and interest income recognized on impaired loans by class of loans | For the Three Months Ended For the Six Months Ended June 30, June 30, Average Interest Average Interest Recorded Income Recorded Income (Dollars in thousands) Investment Recognized Investment Recognized 2018: With no related allowance recorded: One- to four-family residential mortgages $ 2,869 $ 13 $ 2,892 $ 27 Home equity loans and lines of credit 158 — 160 — Total $ 3,027 $ 13 $ 3,052 $ 27 2017: With no related allowance recorded: One- to four-family residential mortgages $ 4,205 $ 18 $ 4,239 $ 31 Home equity loans and lines of credit 178 — 180 — Total $ 4,383 $ 18 $ 4,419 $ 31 |
Schedule of aging of loans and accrual status by class of loans | Loans More Than 90 Days 30 - 59 60 - 89 90 Days or Past Due Days Past Days Past Greater Total Past Loans Not Total Nonaccrual and Still (Dollars in thousands) Due Due Past Due Due Past Due Loans Loans Accruing June 30, 2018: One- to four-family residential mortgages $ — $ 1,298 $ 853 $ 2,151 $ 1,485,214 $ 1,487,365 $ 1,945 $ — Multi-family residential mortgages — — — — 10,609 10,609 — — Construction, commercial and other mortgages — — — — 24,453 24,453 — — Home equity loans and lines of credit — — 41 41 12,037 12,078 156 — Loans on deposit accounts — — — — 281 281 — — Consumer and other 3 — — 3 4,217 4,220 — — Total $ 3 $ 1,298 $ 894 $ 2,195 $ 1,536,811 $ 1,539,006 $ 2,101 $ — December 31, 2017: One- to four-family residential mortgages $ — $ 1,207 $ 1,589 $ 2,796 $ 1,438,725 $ 1,441,521 $ 4,062 $ — Multi-family residential mortgages — — — — 10,782 10,782 — — Construction, commercial and other mortgages — — — — 21,701 21,701 — — Home equity loans and lines of credit — — 41 41 12,846 12,887 165 — Loans on deposit accounts — — — — 274 274 — — Consumer and other 4 — — 4 4,350 4,354 — — Total $ 4 $ 1,207 $ 1,630 $ 2,841 $ 1,488,678 $ 1,491,519 $ 4,227 $ — |
Summary of troubled debt restructurings by class of loan | Number of Accrual Number of Nonaccrual (Dollars in thousands) Loans Status Loans Status Total June 30, 2018: One- to four-family residential mortgages 4 $ 906 4 $ 879 $ 1,785 Home equity loans and lines of credit — — 1 85 85 Total 4 $ 906 5 $ 964 $ 1,870 December 31, 2017: One- to four-family residential mortgages 4 $ 915 5 $ 1,074 $ 1,989 Home equity loans and lines of credit — — 1 92 92 Total 4 $ 915 6 $ 1,166 $ 2,081 |
Securities Sold Under Agreeme28
Securities Sold Under Agreements to Repurchase (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Securities Sold Under Agreements to Repurchase | |
Summary of securities sold under agreements to repurchase | June 30, 2018 December 31, 2017 Weighted Weighted Repurchase Average Repurchase Average (Dollars in thousands) Liability Rate Liability Rate Maturing: 1 year or less $ 20,000 1.66 % $ — — % Over 1 year to 2 years 10,000 1.65 25,000 1.66 Over 2 years to 3 years — — 5,000 1.65 Total $ 30,000 1.66 % $ 30,000 1.66 % |
Summary comparing carrying value and fair value of securities pledged to secure repurchase agreements, repurchase liability, and amount at risk | Weighted Carrying Fair Average Value of Value of Repurchase Amount Months to (Dollars in thousands) Securities Securities Liability at Risk Maturity Maturing: Over 90 days $ 35,089 $ 34,008 $ 30,000 $ 5,089 11 |
Offsetting of Financial Liabi29
Offsetting of Financial Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Offsetting of Financial Liabilities | |
Schedule of securities sold under agreements to repurchase subject to conditional right of offset | Net Amount of Gross Amount Not Offset in the Gross Amount Gross Amount Liabilities Balance Sheet of Recognized Offset in the Presented in the Financial Cash Collateral (Dollars in thousands) Liabilities Balance Sheet Balance Sheet Instruments Pledged Net Amount June 30, 2018: Securities sold under agreements to repurchase $ 30,000 $ — $ 30,000 $ 30,000 $ — $ — December 31, 2017: Securities sold under agreements to repurchase $ 30,000 $ — $ 30,000 $ 30,000 $ — $ — |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Employee Benefit Plans | |
Schedule of components of net periodic benefit cost | SERP SERP Three Months Ended Six Months Ended June 30, June 30, (Dollars in thousands) 2018 2017 2018 2017 Net periodic benefit cost for the period: Service cost $ 20 $ 10 $ 40 $ 20 Interest cost 38 35 75 70 Expected return on plan assets — — — — Amortization of prior service cost — — — — Recognized actuarial loss — — — — Recognized curtailment loss — — — — Net periodic benefit cost $ 58 $ 45 $ 115 $ 90 |
Employee Stock Ownership Plan (
Employee Stock Ownership Plan (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Employee Stock Ownership Plan | |
Schedule of shares held by the ESOP trust | June 30, December 31, 2018 2017 Allocated shares 422,378 397,912 Unearned shares 513,795 538,261 Total ESOP shares 936,173 936,173 Fair value of unearned shares, in thousands $ 15,928 $ 16,616 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Schedule of compensation expense and related tax benefit for all share-based awards | Three Months Ended Six Months Ended June 30, June 30, (In thousands) 2018 2017 2018 2017 Compensation expense $ 69 $ 28 $ 135 $ 37 Income tax benefit 19 11 37 15 |
Schedule of stock option activity | Weighted Aggregate Average Remaining Intrinsic Exercise Contractual Value Options Price Life (years) (in thousands) Options outstanding at December 31, 2017 411,543 $ 17.48 2.73 $ 5,509 Granted — — — — Exercised 69,008 17.36 — 920 Forfeited — — — — Expired — — — — Options outstanding at June 30, 2018 342,535 $ 17.51 2.24 $ 4,621 Options outstanding at December 31, 2016 706,430 $ 17.43 3.70 $ 10,884 Granted — — — — Exercised 110,894 17.36 — 1,670 Forfeited — — — — Expired — — — — Options outstanding at June 30, 2017 595,536 $ 17.45 3.21 $ 8,185 Options vested and exercisable at June 30, 2018 $ $ 4,615 |
Summary of certain stock option activity | For the Three Months Ended For the Six Months Ended June 30, June 30, (In thousands) 2018 2017 2018 2017 Intrinsic value of stock options exercised $ 683 $ 797 $ 920 $ 1,670 Proceeds received from stock options exercised 885 971 1,198 1,925 Tax benefits realized from stock options exercised 178 287 220 594 Total fair value of stock options that vested — — — — |
Restricted Stock | |
Schedule of restricted stock award activity | Weighted Average Grant Restricted Date Fair Stock Value Nonvested at December 31, 2017 10,806 $ 29.16 Granted 10,019 30.73 Vested 3,201 — Forfeited — — Nonvested at June 30, 2018 17,624 $ 29.92 Nonvested at December 31, 2016 2,400 $ 26.23 Granted 9,604 29.53 Vested — — Forfeited — — Nonvested at June 30, 2017 12,004 $ 28.87 |
Restricted Stock Units Based on a Performance Condition | |
Schedule of restricted stock award activity | Performance- Based Restricted Stock Units Weighted Based on a Average Grant Performance Date Fair Condition Value Nonvested at December 31, 2017 11,520 $ 29.53 Granted 12,018 30.73 Vested — — Forfeited — — Nonvested at June 30, 2018 23,538 $ 30.14 |
Restricted Stock Units Based on a Market Condition | |
Schedule of restricted stock award activity | Performance- Based Restricted Monte Carlo Stock Units Valuation of Based on a the Company's Market Condition Stock Nonvested at December 31, 2017 2,879 $ 24.44 Granted 3,005 28.32 Vested — — Forfeited — — Nonvested at June 30, 2018 5,884 $ 26.42 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share | |
Schedule of information used to compute basic and diluted earnings per share | Three Months Ended Six Months Ended June 30, June 30, (Dollars in thousands, except per share data) 2018 2017 2018 2017 Net income $ 4,963 $ 4,301 $ 9,783 $ 8,622 Income allocated to participating securities (27) (4) (42) (7) Net income available to common shareholders $ 4,936 $ 4,297 $ 9,741 $ 8,615 Weighted-average number of shares used in: Basic earnings per share 9,219,859 9,255,739 9,251,999 9,235,553 Dilutive common stock equivalents: Stock options and restricted stock units 174,172 284,018 187,619 303,990 Diluted earnings per share 9,394,031 9,539,757 9,439,618 9,539,543 Net income per common share, basic $ 0.54 $ 0.46 $ 1.05 $ 0.93 Net income per common share, diluted $ 0.53 $ 0.45 $ 1.03 $ 0.90 |
Other Comprehensive Income an34
Other Comprehensive Income and Loss (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Other Comprehensive Income and Loss | |
Schedule of changes in components of accumulated other comprehensive income and loss, net of taxes | Unfunded Unrealized Pension Loss on (Dollars in thousands) Liability Securities Total Three months ended June 30, 2018 Balances at beginning of period $ 6,783 $ 95 $ 6,878 Other comprehensive loss, net of taxes — 11 11 Net current period other comprehensive loss — 11 11 Balances at end of period $ 6,783 $ 106 $ 6,889 Three months ended June 30, 2017 Balances at beginning of period $ 5,284 $ 30 $ 5,314 Other comprehensive loss, net of taxes — 15 15 Net current period other comprehensive loss — 15 15 Balances at end of period $ 5,284 $ 45 $ 5,329 Six months ended June 30, 2018 Balances at beginning of period $ 5,657 $ 37 $ 5,694 Other comprehensive loss, net of taxes — 60 60 Amounts reclassified from accumulated other comprehensive loss 1,126 9 1,135 Net current period other comprehensive loss 1,126 69 1,195 Balances at end of period $ 6,783 $ 106 $ 6,889 Six months ended June 30, 2017 Balances at beginning of period $ 5,284 $ 32 $ 5,316 Other comprehensive loss, net of taxes — 13 13 Net current period other comprehensive loss — 13 13 Balances at end of period $ 5,284 $ 45 $ 5,329 |
Schedule of tax effect on each component of accumulated other comprehensive loss | Three Months Ended June 30, 2018 2017 Pretax After Tax Pretax After Tax (Dollars in thousands) Amount Tax Amount Amount Tax Amount Unrealized loss on securities $ 16 $ (5) $ 11 $ 25 $ (10) $ 15 Total $ 16 $ (5) $ 11 $ 25 $ (10) $ 15 Six Months Ended June 30, 2018 2017 Pretax After Tax Pretax After Tax (Dollars in thousands) Amount Tax Amount Amount Tax Amount Unrealized loss on securities $ 82 $ (22) $ 60 $ 22 $ (9) $ 13 Total $ 82 $ (22) $ 60 $ 22 $ (9) $ 13 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Revenue Recognition | |
Reconciliation of revenue from contracts with customers and other revenue reported in line items | Service Fees on Loan and Deposit (Dollars in thousands) Accounts Other Total Three months ended June 30, 2018 Revenue from contracts with customers $ 391 $ 52 $ 443 Other revenue 96 27 123 Total $ 487 $ 79 $ 566 Three months ended June 30, 2017 Revenue from contracts with customers $ 348 $ 49 $ 397 Other revenue 159 27 186 Total $ 507 $ 76 $ 583 Six months ended June 30, 2018 Revenue from contracts with customers $ 711 $ 93 $ 804 Other revenue 191 55 246 Total $ 902 $ 148 $ 1,050 Six months ended June 30, 2017 Revenue from contracts with customers $ 724 $ 103 $ 827 Other revenue 339 55 394 Total $ 1,063 $ 158 $ 1,221 |
Fair Value of Financial Instr36
Fair Value of Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value of Financial Instruments | |
Schedule of estimated fair values of financial instruments | Carrying Fair Value Measurements Using (Dollars in thousands) Amount Fair Value Level 1 Level 2 Level 3 June 30, 2018 Assets Cash and cash equivalents $ 27,672 $ 27,672 $ 27,672 $ — $ — Investment securities available for sale 2,658 2,658 — 2,658 — Investment securities held to maturity 392,189 382,962 — 382,231 731 Loans receivable, net 1,536,392 1,509,423 — — 1,509,423 FHLB stock 5,925 5,925 — 5,925 — FRB stock 3,106 3,106 — 3,106 — Accrued interest receivable 5,195 5,195 8 1,014 4,173 Interest rate contracts 2 2 — 2 — Liabilities Deposits 1,647,183 1,643,537 — 1,267,555 375,982 Advances from the Federal Home Loan Bank 88,000 87,327 — 87,327 — Securities sold under agreements to repurchase 30,000 29,736 — 29,736 — Accrued interest payable 370 370 — 112 258 Interest rate contracts 2 2 — 2 — December 31, 2017 Assets Cash and cash equivalents $ 32,089 $ 32,089 $ 32,089 $ — $ — Investment securities available for sale 2,851 2,851 — 2,851 — Investment securities held to maturity 404,792 406,663 — 405,818 845 Loans held for sale 403 414 — 414 — Loans receivable, net 1,488,971 1,505,097 — — 1,505,097 FHLB stock 6,541 6,541 — 6,541 — FRB stock 3,103 3,103 — 3,103 — Accrued interest receivable 5,142 5,142 7 1,045 4,090 Interest rate contracts 8 8 — 8 — Liabilities Deposits 1,597,295 1,595,992 — 1,285,070 310,922 Advances from the Federal Home Loan Bank 107,200 107,019 — 107,019 — Securities sold under agreements to repurchase 30,000 29,846 — 29,846 — Accrued interest payable 575 575 — 115 460 Interest rate contracts 8 8 — 8 — |
Schedule of assets and liabilities measured at fair value on a recurring basis | (Dollars in thousands) Level 1 Level 2 Level 3 Total June 30, 2018 Interest rate contracts — assets $ — $ 2 $ — $ 2 Interest rate contracts — liabilities — (2) — (2) Available-for-sale investments — 2,658 — 2,658 December 31, 2017 Interest rate contracts — assets $ — $ 8 $ — $ 8 Interest rate contracts — liabilities — (8) — (8) Available-for-sale investments — 2,851 — 2,851 |
Schedule of assets measured at fair value on a nonrecurring basis and related gains and losses | Fair Value (Dollars in thousands) Adjustment Date Level 1 Level 2 Level 3 Total Total Losses December 31, 2017 Impaired loans 3/31/2017 $ — $ 87 $ — $ 87 $ (11) |
Organization (Details)
Organization (Details) $ in Millions | Dec. 31, 2017USD ($) |
Organization | |
Liquidation account balance | $ 11 |
Recently Issued Accounting Pr38
Recently Issued Accounting Pronouncements (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2018USD ($) | |
Summary of Significant Accounting Policies | |
Reclassification of deferred taxes from accumulated other comprehensive income to retained earnings | $ 1.1 |
Cash and Cash Equivalents (Deta
Cash and Cash Equivalents (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 | Jun. 30, 2017 | Dec. 31, 2016 |
Cash and Cash Equivalents | ||||
Cash and due from banks | $ 9,781 | $ 9,114 | ||
Interest-earning deposits in other banks | 17,891 | 22,975 | ||
Cash and cash equivalents | $ 27,672 | $ 32,089 | $ 47,888 | $ 61,273 |
Investment Securities - Amortiz
Investment Securities - Amortized Cost and Fair Values of Available-for-Sale Securities (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Available-for-sale: | ||
Amortized Cost | $ 2,764 | $ 2,870 |
Gross Unrealized Losses | (106) | (19) |
Estimated Fair Value | 2,658 | 2,851 |
U.S. government-sponsored mortgage-backed securities | ||
Available-for-sale: | ||
Amortized Cost | 2,764 | 2,870 |
Gross Unrealized Losses | (106) | (19) |
Estimated Fair Value | $ 2,658 | $ 2,851 |
Investment Securities - Amort41
Investment Securities - Amortized Cost and Fair Values of Held-to-Maturity Securities (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Held-to-maturity: | ||
Amortized Cost | $ 392,189 | $ 404,792 |
Gross Unrealized Gains | 2,650 | 6,474 |
Gross Unrealized Losses | (11,877) | (4,603) |
Estimated Fair Value | 382,962 | 406,663 |
U.S. government-sponsored mortgage-backed securities | ||
Held-to-maturity: | ||
Amortized Cost | 392,059 | 404,365 |
Gross Unrealized Gains | 2,049 | 6,056 |
Gross Unrealized Losses | (11,877) | (4,603) |
Estimated Fair Value | 382,231 | 405,818 |
Trust preferred securities | ||
Held-to-maturity: | ||
Amortized Cost | 130 | 427 |
Gross Unrealized Gains | 601 | 418 |
Estimated Fair Value | $ 731 | $ 845 |
Investment Securities - Maturit
Investment Securities - Maturity Schedule of Available-for-Sale Securities (Details) $ in Thousands | Jun. 30, 2018USD ($) |
Amortized Cost | |
Due after 10 years | $ 2,764 |
Amortized Cost | 2,764 |
Estimated Fair Value | |
Due after 10 years | 2,658 |
Estimated Fair Value | $ 2,658 |
Investment Securities - Matur43
Investment Securities - Maturity Schedule of Held-to-Maturity Securities (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Held-to-maturity, Amortized Cost | ||
Due within 5 years | $ 7 | |
Due after 5 years through 10 years | 76 | |
Due after 10 years | 392,106 | |
Amortized Cost | 392,189 | $ 404,792 |
Held-to-maturity, Estimated Fair Value | ||
Due within 5 years | 7 | |
Due after 5 years through 10 years | 76 | |
Due after 10 years | 382,879 | |
Estimated Fair Value | $ 382,962 | $ 406,663 |
Investment Securities - Realize
Investment Securities - Realized Gains and Losses and Proceeds from Sales (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Realized gains and losses and the proceeds from sales of securities available for sale, held to maturity and trading | ||||
Proceeds from sales | $ 4,462 | $ 5,053 | ||
U.S. government-sponsored mortgage-backed securities | Held-to-maturity debt securities | ||||
Realized gains and losses and the proceeds from sales of securities available for sale, held to maturity and trading | ||||
Proceeds from sales | $ 4,462 | $ 3,464 | 4,462 | 5,053 |
Gross gains | $ 45 | $ 186 | $ 45 | $ 281 |
U.S. government-sponsored mortgage-backed securities | Held-to-maturity debt securities | Minimum | ||||
Realized gains and losses and the proceeds from sales of securities available for sale, held to maturity and trading | ||||
Portion of outstanding purchased principal already collected | 85.00% | 85.00% | 85.00% | 85.00% |
Investment Securities - Securit
Investment Securities - Securities Pledged (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Dec. 31, 2017 |
Pledged investment securities | ||
Investment securities pledged to secure public deposit, securities sold under agreement to repurchase and transaction clearing accounts | $ 311.4 | $ 287.2 |
Investment Securities _ Availab
Investment Securities – Available-for-Sale Unrealized Loss Position Summary (Details) - U.S. government-sponsored mortgage-backed securities $ in Thousands | Jun. 30, 2018USD ($)security | Dec. 31, 2017USD ($)security |
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months Fair Value | $ 2,658 | $ 2,851 |
Less Than 12 Months Unrealized Losses | $ 106 | $ 19 |
Number of Securities | security | 1 | 1 |
Total Fair Value | $ 2,658 | $ 2,851 |
Total Unrealized Losses | $ 106 | $ 19 |
Investment Securities - Held-to
Investment Securities - Held-to-Maturity Unrealized Loss Position Summary (Details) - U.S. government-sponsored mortgage-backed securities $ in Thousands | Jun. 30, 2018USD ($)security | Dec. 31, 2017USD ($)security |
Investment Securities | ||
Less Than 12 Months Fair Value | $ 170,316 | $ 41,163 |
Less Than 12 Months Unrealized Losses | 3,782 | 299 |
12 Months or Longer Fair Value | 128,277 | 140,200 |
12 Months or Longer Unrealized Losses | $ 8,095 | $ 4,304 |
Total Number of Securities | security | 88 | 49 |
Total Fair Value | $ 298,593 | $ 181,363 |
Total Unrealized Losses | $ 11,877 | $ 4,603 |
Investment Securities - Trust P
Investment Securities - Trust Preferred Securities (Details) | 78 Months Ended | 126 Months Ended | |
Jun. 30, 2018USD ($)Transactionsecurity | Jun. 30, 2018USD ($)security | Dec. 31, 2017USD ($) | |
Investment Securities | |||
Amortized cost | $ 392,189,000 | $ 392,189,000 | $ 404,792,000 |
Trust preferred securities | |||
Investment Securities | |||
Amortized cost | $ 130,000 | $ 130,000 | $ 427,000 |
Number of market transactions of the security | Transaction | 7 | ||
Number of new security pools | security | 0 | ||
Trust preferred securities | PreTSL XXIII | |||
Investment Securities | |||
Number of securities owned | security | 1 | 1 | |
Amortized cost | $ 130,000 | $ 130,000 | |
Remaining cost basis | 130,000 | 130,000 | |
Accumulated other comprehensive loss | $ 0 | $ 0 |
Investment Securities - Cumulat
Investment Securities - Cumulative Roll Forward of Credit Losses Recognized in Earnings (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Cumulative roll forward of credit losses recognized in earnings for debt securities held and not intended to be sold | ||
Balance at the beginning of the period | $ 2,403 | $ 2,403 |
Credit losses on debt securities for which other-than-temporary impairment was not previously recognized | 0 | 0 |
Balance at the end of the period | $ 2,403 | $ 2,403 |
Loans Receivable and Allowanc50
Loans Receivable and Allowance for Loan Losses - Components (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 |
Real estate loans: | ||||||
Total real estate loans | $ 1,537,714 | $ 1,490,093 | ||||
Other loans: | ||||||
Total other loans | 4,488 | 4,614 | ||||
Less: Net unearned fees and discounts | (3,196) | (3,188) | ||||
Less: Allowance for loan losses | (2,614) | $ (2,554) | (2,548) | $ (2,457) | $ (2,540) | $ (2,452) |
Total unearned fees, discounts and allowance for loan losses | (5,810) | (5,736) | ||||
Loans receivable, net | 1,536,392 | 1,488,971 | ||||
One- to four-family residential | ||||||
Real estate loans: | ||||||
Total real estate loans | 1,490,465 | 1,444,625 | ||||
Multi-family residential | ||||||
Real estate loans: | ||||||
Total real estate loans | 10,626 | 10,799 | ||||
Construction, Commercial and Other Mortgage Loans | ||||||
Real estate loans: | ||||||
Total real estate loans | 24,549 | 21,787 | ||||
Other loans: | ||||||
Less: Allowance for loan losses | (547) | (530) | (539) | (556) | (564) | (519) |
Home Equity Loans and Lines of Credit | ||||||
Real estate loans: | ||||||
Total real estate loans | 12,074 | 12,882 | ||||
Other loans: | ||||||
Less: Allowance for loan losses | (1) | $ (1) | (1) | $ (1) | $ (1) | $ (2) |
Loans on Deposit Accounts | ||||||
Other loans: | ||||||
Total other loans | 281 | 274 | ||||
Consumer and Other | ||||||
Other loans: | ||||||
Total other loans | $ 4,207 | $ 4,340 |
Loans Receivable and Allowanc51
Loans Receivable and Allowance for Loan Losses - Activity in Allowance for Loan Losses (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Activity in allowance for loan losses | ||||
Balance, beginning of period | $ 2,554 | $ 2,540 | $ 2,548 | $ 2,452 |
Provision (reversal of provision) for loan losses | 60 | (123) | 69 | (52) |
Allowance for loan losses on loans receivable after provision (reversal of allowance) | 2,614 | 2,417 | 2,617 | 2,400 |
Charge-offs | (7) | (7) | (12) | (23) |
Recoveries | 7 | 47 | 9 | 80 |
Net recoveries (charge-offs) | 40 | (3) | 57 | |
Balance, end of period | 2,614 | 2,457 | 2,614 | 2,457 |
Residential Mortgage | ||||
Activity in allowance for loan losses | ||||
Balance, beginning of period | 1,720 | 1,603 | 1,721 | 1,594 |
Provision (reversal of provision) for loan losses | 34 | (45) | 33 | (56) |
Allowance for loan losses on loans receivable after provision (reversal of allowance) | 1,754 | 1,558 | 1,754 | 1,538 |
Charge-offs | (11) | |||
Recoveries | 6 | 44 | 6 | 75 |
Net recoveries (charge-offs) | 6 | 44 | 6 | 64 |
Balance, end of period | 1,760 | 1,602 | 1,760 | 1,602 |
Construction, Commercial and Other Mortgage Loans | ||||
Activity in allowance for loan losses | ||||
Balance, beginning of period | 530 | 564 | 539 | 519 |
Provision (reversal of provision) for loan losses | 17 | (8) | 8 | 37 |
Allowance for loan losses on loans receivable after provision (reversal of allowance) | 547 | 556 | 547 | 556 |
Balance, end of period | 547 | 556 | 547 | 556 |
Home Equity Loans and Lines of Credit | ||||
Activity in allowance for loan losses | ||||
Balance, beginning of period | 1 | 1 | 1 | 2 |
Provision (reversal of provision) for loan losses | (1) | |||
Allowance for loan losses on loans receivable after provision (reversal of allowance) | 1 | 1 | 1 | 1 |
Balance, end of period | 1 | 1 | 1 | 1 |
Consumer and other loans | ||||
Activity in allowance for loan losses | ||||
Balance, beginning of period | 49 | 135 | 55 | 115 |
Provision (reversal of provision) for loan losses | 2 | (78) | (1) | (55) |
Allowance for loan losses on loans receivable after provision (reversal of allowance) | 51 | 57 | 54 | 60 |
Charge-offs | (7) | (7) | (12) | (12) |
Recoveries | 1 | 3 | 3 | 5 |
Net recoveries (charge-offs) | (6) | (4) | (9) | (7) |
Balance, end of period | 45 | 53 | 45 | 53 |
Unallocated | ||||
Activity in allowance for loan losses | ||||
Balance, beginning of period | 254 | 237 | 232 | 222 |
Provision (reversal of provision) for loan losses | 7 | 8 | 29 | 23 |
Allowance for loan losses on loans receivable after provision (reversal of allowance) | 261 | 245 | 261 | 245 |
Balance, end of period | $ 261 | $ 245 | $ 261 | $ 245 |
Loans Receivable and Allowanc52
Loans Receivable and Allowance for Loan Losses - Balance in Allowance for Loan Losses and Recorded Investment (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 |
Allowance for loan losses: | ||||||
Collectively evaluated for impairment | $ 2,614 | $ 2,548 | ||||
Total ending allowance balance | 2,614 | $ 2,554 | 2,548 | $ 2,457 | $ 2,540 | $ 2,452 |
Loans: | ||||||
Individually evaluated for impairment | 3,007 | 5,142 | ||||
Collectively evaluated for impairment | 1,535,999 | 1,486,377 | ||||
Total ending loan balance | 1,539,006 | 1,491,519 | ||||
Residential Mortgage | ||||||
Allowance for loan losses: | ||||||
Collectively evaluated for impairment | 1,760 | 1,721 | ||||
Total ending allowance balance | 1,760 | 1,720 | 1,721 | 1,602 | 1,603 | 1,594 |
Loans: | ||||||
Individually evaluated for impairment | 2,851 | 4,977 | ||||
Collectively evaluated for impairment | 1,495,123 | 1,447,326 | ||||
Total ending loan balance | 1,497,974 | 1,452,303 | ||||
Construction, Commercial and Other Mortgage Loans | ||||||
Allowance for loan losses: | ||||||
Collectively evaluated for impairment | 547 | 539 | ||||
Total ending allowance balance | 547 | 530 | 539 | 556 | 564 | 519 |
Loans: | ||||||
Collectively evaluated for impairment | 24,453 | 21,701 | ||||
Total ending loan balance | 24,453 | 21,701 | ||||
Home Equity Loans and Lines of Credit | ||||||
Allowance for loan losses: | ||||||
Collectively evaluated for impairment | 1 | 1 | ||||
Total ending allowance balance | 1 | 1 | 1 | 1 | 1 | 2 |
Loans: | ||||||
Individually evaluated for impairment | 156 | 165 | ||||
Collectively evaluated for impairment | 11,922 | 12,722 | ||||
Total ending loan balance | 12,078 | 12,887 | ||||
Consumer and other loans | ||||||
Allowance for loan losses: | ||||||
Collectively evaluated for impairment | 45 | 55 | ||||
Total ending allowance balance | 45 | 49 | 55 | 53 | 135 | 115 |
Loans: | ||||||
Collectively evaluated for impairment | 4,501 | 4,628 | ||||
Total ending loan balance | 4,501 | 4,628 | ||||
Unallocated | ||||||
Allowance for loan losses: | ||||||
Collectively evaluated for impairment | 261 | 232 | ||||
Total ending allowance balance | $ 261 | $ 254 | $ 232 | $ 245 | $ 237 | $ 222 |
Loans Receivable and Allowanc53
Loans Receivable and Allowance for Loan Losses - Impaired Loans (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Impaired loans | |||||
Average Recorded Investment | $ 3,027 | $ 4,383 | $ 3,052 | $ 4,419 | |
Interest Income Recognized | 13 | 18 | 27 | 31 | |
One- to four-family residential | |||||
Impaired loans | |||||
Average Recorded Investment | 2,869 | 4,205 | 2,892 | 4,239 | |
Interest Income Recognized | 13 | 18 | 27 | 31 | |
Home Equity Loans and Lines of Credit | |||||
Impaired loans | |||||
Average Recorded Investment | 158 | $ 178 | 160 | $ 180 | |
Individually Evaluated for Impairment | |||||
Impaired loans | |||||
Recorded Investment | 3,007 | 3,007 | $ 5,142 | ||
Unpaid Principal Balance | 3,652 | 3,652 | 6,125 | ||
Loans individually evaluated for impairment with a related allowance for loan loss | 0 | 0 | 0 | ||
Individually Evaluated for Impairment | One- to four-family residential | |||||
Impaired loans | |||||
Recorded Investment | 2,851 | 2,851 | 4,977 | ||
Unpaid Principal Balance | 3,426 | 3,426 | 5,897 | ||
Individually Evaluated for Impairment | Home Equity Loans and Lines of Credit | |||||
Impaired loans | |||||
Recorded Investment | 156 | 156 | 165 | ||
Unpaid Principal Balance | $ 226 | $ 226 | $ 228 |
Loans Receivable and Allowanc54
Loans Receivable and Allowance for Loan Losses - Delinquent and Nonaccrual Loans (Details) | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2018USD ($)loan | Jun. 30, 2017USD ($) | Dec. 31, 2017USD ($)loan | |
Accounts, Notes, Loans and Financing Receivable | |||
Nonaccrual Loans | $ 2,101,000 | $ 4,227,000 | |
Mortgage Loans on Real Estate | Minimum | |||
Accounts, Notes, Loans and Financing Receivable | |||
Loan delinquency period that may result in loss | 90 days | ||
Loan delinquency period after which an appraisal is obtained of the underlying collateral | 4 months | ||
Non Accrual Loans | |||
Accounts, Notes, Loans and Financing Receivable | |||
Number of loans | loan | 12 | 17 | |
Nonaccrual Loans | $ 2,100,000 | $ 4,200,000 | |
Interest collected on nonaccrual loans recorded as a reduction of principal | 52,000 | $ 87,000 | |
Non accrual loans, additional interest income that would have been recognized had the loans been accruing interest | $ 69,000 | $ 114,000 |
Loans Receivable and Allowanc55
Loans Receivable and Allowance for Loan Losses - Aging of Loans and Accrual Status (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | $ 2,195 | $ 2,841 |
Loans Not Past Due | 1,536,811 | 1,488,678 |
Total ending loan balance | 1,539,006 | 1,491,519 |
Nonaccrual Loans | 2,101 | 4,227 |
One- to four-family residential | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 2,151 | 2,796 |
Loans Not Past Due | 1,485,214 | 1,438,725 |
Total ending loan balance | 1,487,365 | 1,441,521 |
Nonaccrual Loans | 1,945 | 4,062 |
Multi-family residential | ||
Financing Receivable, Recorded Investment, Past Due | ||
Loans Not Past Due | 10,609 | 10,782 |
Total ending loan balance | 10,609 | 10,782 |
Construction, Commercial and Other Mortgage Loans | ||
Financing Receivable, Recorded Investment, Past Due | ||
Loans Not Past Due | 24,453 | 21,701 |
Total ending loan balance | 24,453 | 21,701 |
Home Equity Loans and Lines of Credit | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 41 | 41 |
Loans Not Past Due | 12,037 | 12,846 |
Total ending loan balance | 12,078 | 12,887 |
Nonaccrual Loans | 156 | 165 |
Loans on Deposit Accounts | ||
Financing Receivable, Recorded Investment, Past Due | ||
Loans Not Past Due | 281 | 274 |
Total ending loan balance | 281 | 274 |
Consumer and Other | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 3 | 4 |
Loans Not Past Due | 4,217 | 4,350 |
Total ending loan balance | 4,220 | 4,354 |
30 - 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 3 | 4 |
30 - 59 Days Past Due | Consumer and Other | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 3 | 4 |
60 - 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 1,298 | 1,207 |
60 - 89 Days Past Due | One- to four-family residential | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 1,298 | 1,207 |
90 Days or Greater Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 894 | 1,630 |
90 Days or Greater Past Due | One- to four-family residential | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 853 | 1,589 |
90 Days or Greater Past Due | Home Equity Loans and Lines of Credit | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | $ 41 | $ 41 |
Loans Receivable and Allowanc56
Loans Receivable and Allowance for Loan Losses - Troubled Debt Restructurings (Details) | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2018USD ($)loan | Jun. 30, 2017loan | Jun. 30, 2018USD ($)loan | Dec. 31, 2017USD ($)loan | |
Troubled debt restructurings | ||||
Number of loans subsequently defaulted | loan | 0 | |||
Additional disclosures | ||||
Loans modified by troubled debt restructurings considered impaired | $ 1,870,000 | $ 1,870,000 | $ 2,081,000 | |
Real estate owned | $ 0 | $ 0 | $ 0 | |
Accruing interest | ||||
Additional disclosures | ||||
Number of loans modified by troubled debt restructurings considered impaired | loan | 4 | 4 | 4 | |
Loans modified by troubled debt restructurings considered impaired | $ 906,000 | $ 906,000 | $ 915,000 | |
Non Accrual Loans | ||||
Additional disclosures | ||||
Number of loans modified by troubled debt restructurings considered impaired | loan | 5 | 5 | 6 | |
Loans modified by troubled debt restructurings considered impaired | $ 964,000 | $ 964,000 | $ 1,166,000 | |
Loans modified in troubled debt restructuring | ||||
Troubled debt restructurings | ||||
Number of Loans | loan | 0 | 0 | ||
Additional disclosures | ||||
Commitments to lend additional funds to borrowers | $ 0 | $ 0 | ||
Nonperforming Financing Receivable | Non Accrual Loans | ||||
Additional disclosures | ||||
Number of loans modified by troubled debt restructurings considered impaired | loan | 0 | 0 | ||
Nonperforming Financing Receivable | Non Accrual Loans | More than 149 days past due | ||||
Additional disclosures | ||||
Number of loans modified by troubled debt restructurings considered impaired | loan | 1 | |||
Loans modified by troubled debt restructurings considered impaired | $ 149,000 | |||
One- to four-family residential | ||||
Additional disclosures | ||||
Loans modified by troubled debt restructurings considered impaired | $ 1,785,000 | $ 1,785,000 | $ 1,989,000 | |
Mortgage loans in process of foreclosure, number of contracts | loan | 1 | 1 | 3 | |
Mortgage loans in process of foreclosure, total value | $ 436,000 | $ 436,000 | $ 650,000 | |
One- to four-family residential | Accruing interest | ||||
Additional disclosures | ||||
Number of loans modified by troubled debt restructurings considered impaired | loan | 4 | 4 | 4 | |
Loans modified by troubled debt restructurings considered impaired | $ 906,000 | $ 906,000 | $ 915,000 | |
One- to four-family residential | Non Accrual Loans | ||||
Additional disclosures | ||||
Number of loans modified by troubled debt restructurings considered impaired | loan | 4 | 4 | 5 | |
Loans modified by troubled debt restructurings considered impaired | $ 879,000 | $ 879,000 | $ 1,074,000 | |
Home Equity Loans and Lines of Credit | ||||
Additional disclosures | ||||
Loans modified by troubled debt restructurings considered impaired | $ 85,000 | $ 85,000 | $ 92,000 | |
Mortgage loans in process of foreclosure, number of contracts | loan | 1 | 1 | 1 | |
Mortgage loans in process of foreclosure, total value | $ 41,000 | $ 41,000 | $ 41,000 | |
Home Equity Loans and Lines of Credit | Non Accrual Loans | ||||
Additional disclosures | ||||
Number of loans modified by troubled debt restructurings considered impaired | loan | 1 | 1 | 1 | |
Loans modified by troubled debt restructurings considered impaired | $ 85,000 | $ 85,000 | $ 92,000 |
Loans Receivable and Allowanc57
Loans Receivable and Allowance for Loan Losses - Collateral, Sales, Serviced for Others, Directors and Executive Officers (Details) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2018USD ($) | Jun. 30, 2017USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2017USD ($) | Dec. 31, 2017USD ($)loan | |
Accounts, Notes, Loans and Financing Receivable | |||||
Loans serviced for others | $ 32,300,000 | $ 32,300,000 | $ 35,500,000 | ||
Loans serviced for others, securitization for which the company continues to hold the related mortgage-backed securities | 1,500,000 | 1,500,000 | $ 1,500,000 | ||
Loans serviced for others, amount of contractually specified servicing fees earned | $ 22,000 | $ 26,000 | $ 46,000 | $ 54,000 | |
Mortgage Loans on Real Estate | Maximum | |||||
Accounts, Notes, Loans and Financing Receivable | |||||
Loan to value ratio (as a percent) | 80.00% | 80.00% | |||
Residential Mortgage Loans Held For Sale | |||||
Accounts, Notes, Loans and Financing Receivable | |||||
Residential mortgage loans sold, loan amount | $ 7,000,000 | 16,600,000 | |||
Residential mortgage loans sold, recognized gains | $ 53,000 | $ 126,000 | |||
Number of loans | loan | 1 | ||||
Residential mortgage loans held for sale | $ 403,000 |
Securities Sold Under Agreeme58
Securities Sold Under Agreements to Repurchase - Summary of Repurchase Liability by Maturity (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Securities sold under agreements to repurchase | ||
Repurchase Liability | $ 30,000 | $ 30,000 |
Weighted Average | ||
Securities sold under agreements to repurchase | ||
Rate (as a percent) | 1.66% | 1.66% |
1 year or less | ||
Securities sold under agreements to repurchase | ||
Repurchase Liability | $ 20,000 | |
1 year or less | Weighted Average | ||
Securities sold under agreements to repurchase | ||
Rate (as a percent) | 1.66% | |
Over 1 year to 2 years | ||
Securities sold under agreements to repurchase | ||
Repurchase Liability | $ 10,000 | $ 25,000 |
Over 1 year to 2 years | Weighted Average | ||
Securities sold under agreements to repurchase | ||
Rate (as a percent) | 1.65% | 1.66% |
Over 2 years to 3 years | ||
Securities sold under agreements to repurchase | ||
Repurchase Liability | $ 5,000 | |
Over 2 years to 3 years | Weighted Average | ||
Securities sold under agreements to repurchase | ||
Rate (as a percent) | 1.65% |
Securities Sold Under Agreeme59
Securities Sold Under Agreements to Repurchase - Summary of Securities Pledged (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Securities sold under agreements to repurchase | |
Repurchase liability maximum | 90.00% |
Maturing Over 90 days | |
Securities sold under agreements to repurchase | |
Carrying Value of Securities | $ 35,089 |
Fair Value of Securities | 34,008 |
Repurchase Liability | 30,000 |
Amount at Risk | $ 5,089 |
Weighted Average Months to Maturity | 11 months |
Offsetting of Financial Liabi60
Offsetting of Financial Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Securities sold under agreements to repurchase | ||
Gross Amount of Recognized Liabilities | $ 30,000 | $ 30,000 |
Net Amount of Liabilities Presented in the Balance Sheet | 30,000 | 30,000 |
Gross amount not offset in the balance sheet | ||
Financial Instruments | $ 30,000 | $ 30,000 |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Pension Plan | ||||
Pension and Other Postretirement Benefit Contributions | ||||
Pension contribution made | $ 1,000 | |||
Pension Plan | Minimum | ||||
Pension and Other Postretirement Benefit Contributions | ||||
Requisite service period for receiving benefits under the plan | 1 year | |||
Supplemental Employee Retirement Plan (SERP) | ||||
Net periodic benefit cost for the year: | ||||
Service cost | 20 | $ 10 | $ 40 | $ 20 |
Interest cost | 38 | 35 | 75 | 70 |
Net periodic benefit cost | $ 58 | $ 45 | $ 115 | $ 90 |
Employee Stock Ownership Plan -
Employee Stock Ownership Plan - Loan, Expense and Shares (Details) - USD ($) | Jul. 10, 2009 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 |
Employee Stock Ownership Plan | ||||||
ESOP expense | $ 749,000 | $ 775,000 | ||||
ESOP | ||||||
Employee Stock Ownership Plan | ||||||
Amount borrowed from employer | $ 9,800,000 | |||||
Shares purchased | 978,650 | |||||
Percentage of shares issued in initial public offering | 8.00% | |||||
Employee stock ownership plan, price per share of shares acquired in initial public offering (in dollars per share) | $ 10 | |||||
Term of loan | 20 years | |||||
ESOP expense | $ 435,000 | $ 305,000 | $ 811,000 | $ 626,000 | ||
Allocated shares | 422,378 | 422,378 | 397,912 | |||
Unearned shares | 513,795 | 513,795 | 538,261 | |||
Total ESOP shares | 936,173 | 936,173 | 936,173 | |||
Fair value of unearned shares, in thousands | $ 15,928,000 | $ 15,928,000 | $ 16,616,000 | |||
ESOP | Prime rate | ||||||
Employee Stock Ownership Plan | ||||||
Variable interest rate | Wall Street Journal Prime Rate |
Employee Stock Ownership Plan63
Employee Stock Ownership Plan - Nonqualified ESOP Restoration Plan (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
ESOP restoration | Certain executives | ||||
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits | ||||
Accrued (reversed) benefits | $ 16,000 | $ (53,000) | $ 111,000 | $ 64,000 |
Share-Based Compensation - Plan
Share-Based Compensation - Plan Provisions (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Share-Based Compensation | ||||
Compensation expense | $ 69 | $ 28 | $ 135 | $ 37 |
Income tax benefit | $ 19 | $ 11 | $ 37 | $ 15 |
2010 Equity Incentive Plan | ||||
Share-Based Compensation | ||||
Number of shares authorized | 1,862,637 | 1,862,637 | ||
2010 Equity Incentive Plan | Vesting period one | ||||
Share-Based Compensation | ||||
Unrecognized compensation costs, period of recognition | 3 years | |||
Vesting period | 3 years | |||
2010 Equity Incentive Plan | Vesting period two | ||||
Share-Based Compensation | ||||
Unrecognized compensation costs, period of recognition | 5 years | |||
Vesting period | 5 years | |||
2010 Equity Incentive Plan | Vesting period three | ||||
Share-Based Compensation | ||||
Unrecognized compensation costs, period of recognition | 6 years | |||
Vesting period | 6 years |
Share-Based Compensation - Stoc
Share-Based Compensation - Stock Option Activity (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | |
Common Stock | ||||||
Stock option activity | ||||||
Exercised (in shares) | 69,008 | 110,894 | ||||
Stock option activity | ||||||
Shares of common stock issued in exchange for stock options and common shares | 29,979 | |||||
Common shares exchanged | 39,029 | |||||
Stock Options | ||||||
Stock option activity | ||||||
Balance at beginning of period (in shares) | 411,543 | 706,430 | 706,430 | |||
Exercised (in shares) | 69,008 | 110,894 | ||||
Balance at end of period (in shares) | 342,535 | 595,536 | 342,535 | 595,536 | 411,543 | 706,430 |
Options vested and exercisable (in shares) | 341,335 | 341,335 | ||||
Weighted Average Exercise Price | ||||||
Balance at beginning of period (in dollars per share) | $ 17.48 | $ 17.43 | $ 17.43 | |||
Exercised (in dollars per share) | 17.36 | 17.36 | ||||
Balance at end of period (in dollars per share) | $ 17.51 | $ 17.45 | 17.51 | $ 17.45 | $ 17.48 | $ 17.43 |
Options vested and exercisable (in dollars per share) | $ 17.48 | $ 17.48 | ||||
Remaining Contractual Life | ||||||
Options outstanding | 2 years 2 months 27 days | 3 years 2 months 16 days | 2 years 8 months 23 days | 3 years 8 months 12 days | ||
Options vested and exercisable | 2 years 2 months 19 days | |||||
Aggregate Intrinsic Value | ||||||
Beginning of period | $ 5,509,000 | $ 10,884,000 | $ 10,884,000 | |||
Exercised | $ 683,000 | $ 797,000 | 920,000 | 1,670,000 | ||
End of period | 4,621,000 | 8,185,000 | 4,621,000 | 8,185,000 | $ 5,509,000 | $ 10,884,000 |
Options vested and exercisable | 4,615,000 | 4,615,000 | ||||
Stock option activity | ||||||
Intrinsic value of stock options exercised | 683,000 | 797,000 | 920,000 | 1,670,000 | ||
Proceeds received from stock options exercised | 885,000 | 971,000 | 1,198,000 | 1,925,000 | ||
Tax benefits realized from stock options exercised | 178,000 | $ 287,000 | 220,000 | $ 594,000 | ||
Unrecognized compensation costs | $ 1,000 | $ 1,000 | ||||
Unrecognized compensation costs, period of recognition | 3 years | |||||
Stock Options | Common Stock | ||||||
Stock option activity | ||||||
Exercised (in shares) | 69,008 |
Share-Based Compensation - Rest
Share-Based Compensation - Restricted Stock Awards (Details) - USD ($) | Mar. 08, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 |
Restricted Stock | ||||
Restricted Stock Awards | ||||
Non-vested at beginning of period (in shares) | 10,806 | 2,400 | ||
Granted (in shares) | 10,019 | 9,604 | ||
Vested (in shares) | 3,201 | |||
Non-vested at end of period (in shares) | 17,624 | 12,004 | ||
Weighted Average Grant Date Fair Value | ||||
Non-vested at beginning of period (in dollars per share) | $ 29.16 | $ 26.23 | ||
Granted (in dollars per share) | 30.73 | 29.53 | ||
Non-vested at end of period (in dollars per share) | $ 29.92 | $ 28.87 | ||
Unrecognized compensation | ||||
Vesting period | 3 years | |||
Unrecognized compensation costs | $ 460,000 | |||
Restricted Stock Units Based on a Performance Condition | ||||
Restricted Stock Awards | ||||
Non-vested at beginning of period (in shares) | 11,520 | |||
Granted (in shares) | 12,018 | |||
Non-vested at end of period (in shares) | 23,538 | |||
Weighted Average Grant Date Fair Value | ||||
Non-vested at beginning of period (in dollars per share) | $ 29.53 | |||
Granted (in dollars per share) | 30.73 | |||
Non-vested at end of period (in dollars per share) | $ 30.14 | |||
Unrecognized compensation | ||||
Unrecognized compensation costs | $ 253,000 | |||
Unrecognized compensation costs, period of recognition | 3 years | |||
Restricted Stock Units Based on a Performance Condition | Minimum | ||||
Unrecognized compensation | ||||
Shares vesting as a percentage of target | 0.00% | |||
Restricted Stock Units Based on a Performance Condition | Maximum | ||||
Unrecognized compensation | ||||
Shares vesting as a percentage of target | 150.00% | |||
Restricted Stock Units Based on a Market Condition | ||||
Restricted Stock Awards | ||||
Non-vested at beginning of period (in shares) | 2,879 | |||
Granted (in shares) | 3,005 | |||
Non-vested at end of period (in shares) | 5,884 | |||
Weighted Average Grant Date Fair Value | ||||
Non-vested at beginning of period (in dollars per share) | $ 24.44 | |||
Granted (in dollars per share) | 28.32 | |||
Non-vested at end of period (in dollars per share) | $ 26.42 | |||
Unrecognized compensation | ||||
Unrecognized compensation costs | $ 80,000 | |||
Unrecognized compensation costs, period of recognition | 3 years | |||
Assumptions used in the Monte Carlo valuation of PRSUs | ||||
Term used for risk-free rate and historical volatility | 2 years 9 months 26 days | |||
Risk-free interest rate (as a percent) | 2.39% | |||
Closing stock price (in dollars per share) | $ 30.73 | $ 30.87 | ||
Annualized volatility (as a percent) | 16.60% |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Earnings Per Share | ||||
Net income | $ 4,963 | $ 4,301 | $ 9,783 | $ 8,622 |
Income allotted to participating securities | (27) | (4) | (42) | (7) |
Net income available to common shareholders | $ 4,936 | $ 4,297 | $ 9,741 | $ 8,615 |
Weighted-average number of shares used in: | ||||
Basic earnings per share (in shares) | 9,219,859 | 9,255,739 | 9,251,999 | 9,235,553 |
Dilutive common stock equivalents: | ||||
Stock options and restricted stock units (in shares) | 174,172 | 284,018 | 187,619 | 303,990 |
Diluted earnings per share (in shares) | 9,394,031 | 9,539,757 | 9,439,618 | 9,539,543 |
Net income per common share, basic (in dollars per share) | $ 0.54 | $ 0.46 | $ 1.05 | $ 0.93 |
Net income per common share, diluted (in dollars per share) | $ 0.53 | $ 0.45 | $ 1.03 | $ 0.90 |
Other Comprehensive Income an68
Other Comprehensive Income and Loss - Changes in Components of Accumulated Other Comprehensive Income and Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Changes in the components of accumulated other comprehensive loss, net of taxes | ||||
Balances at beginning of period | $ (234,854) | $ (229,786) | ||
Other comprehensive loss, net of taxes | $ 11 | $ 15 | 60 | 13 |
Balances at end of period | (234,699) | (235,467) | (234,699) | (235,467) |
Accumulated Other Comprehensive Loss | ||||
Changes in the components of accumulated other comprehensive loss, net of taxes | ||||
Balances at beginning of period | 6,878 | 5,314 | 5,694 | 5,316 |
Other comprehensive loss, net of taxes | 11 | 15 | 60 | 13 |
Amounts reclassified from accumulated other comprehensive loss | 1,135 | |||
Net current period other comprehensive loss | 11 | 15 | 1,195 | 13 |
Balances at end of period | 6,889 | 5,329 | 6,889 | 5,329 |
Unfunded Pension Liability | ||||
Changes in the components of accumulated other comprehensive loss, net of taxes | ||||
Balances at beginning of period | 6,783 | 5,284 | 5,657 | 5,284 |
Amounts reclassified from accumulated other comprehensive loss | 1,126 | |||
Net current period other comprehensive loss | 1,126 | |||
Balances at end of period | 6,783 | 5,284 | 6,783 | 5,284 |
Unrealized Loss on Securities | ||||
Changes in the components of accumulated other comprehensive loss, net of taxes | ||||
Balances at beginning of period | 95 | 30 | 37 | 32 |
Other comprehensive loss, net of taxes | 11 | 15 | 60 | 13 |
Amounts reclassified from accumulated other comprehensive loss | 9 | |||
Net current period other comprehensive loss | 11 | 15 | 69 | 13 |
Balances at end of period | $ 106 | $ 45 | $ 106 | $ 45 |
Other Comprehensive Income an69
Other Comprehensive Income and Loss - Tax Effect on Each Component (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Tax effect on each component of other comprehensive loss | ||||
Pretax amount | $ 16 | $ 25 | $ 82 | $ 22 |
Tax | (5) | (10) | (22) | (9) |
After Tax Amount | 11 | 15 | 60 | 13 |
Accumulated Other Comprehensive Loss | ||||
Tax effect on each component of other comprehensive loss | ||||
After Tax Amount | 11 | 15 | 60 | 13 |
Unrealized Loss on Securities | ||||
Tax effect on each component of other comprehensive loss | ||||
Pretax amount | 16 | 25 | 82 | 22 |
Tax | (5) | (10) | (22) | (9) |
After Tax Amount | $ 11 | $ 15 | $ 60 | $ 13 |
Revenue Recognition (Details)
Revenue Recognition (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Revenues | ||||
Revenue from contracts with customers | $ 443 | $ 397 | $ 804 | $ 827 |
Other revenue | 123 | 186 | 246 | 394 |
Total | 487 | 507 | 902 | 1,063 |
Total | 79 | 76 | 148 | 158 |
Total | 566 | 583 | 1,050 | 1,221 |
Service Fees on Loan and Deposit Accounts | ||||
Revenues | ||||
Revenue from contracts with customers | 391 | 348 | 711 | 724 |
Other revenue | 96 | 159 | 191 | 339 |
Total | 487 | 507 | 902 | 1,063 |
Other | ||||
Revenues | ||||
Revenue from contracts with customers | 52 | 49 | 93 | 103 |
Other revenue | 27 | 27 | 55 | 55 |
Total | $ 79 | $ 76 | $ 148 | $ 158 |
Fair Value of Financial Instr71
Fair Value of Financial Instruments - Estimated Fair Values (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Assets | ||
Investment securities available for sale | $ 2,658 | $ 2,851 |
Investment securities held to maturity | 382,962 | 406,663 |
Carrying Amount | ||
Assets | ||
Cash and cash equivalents | 27,672 | 32,089 |
Investment securities available for sale | 2,658 | 2,851 |
Investment securities held to maturity | 392,189 | 404,792 |
Loans held for sale | 403 | |
Loans receivable, net | 1,536,392 | 1,488,971 |
FHLB stock | 5,925 | 6,541 |
FRB stock | 3,106 | 3,103 |
Accrued interest receivable | 5,195 | 5,142 |
Interest rate contracts | 2 | 8 |
Liabilities | ||
Deposits | 1,647,183 | 1,597,295 |
Advances from the Federal Home Loan Bank | 88,000 | 107,200 |
Securities sold under agreements to repurchase | 30,000 | 30,000 |
Accrued interest payable | 370 | 575 |
Interest rate contracts | 2 | 8 |
Estimated Fair Value | ||
Assets | ||
Cash and cash equivalents | 27,672 | 32,089 |
Investment securities available for sale | 2,658 | 2,851 |
Investment securities held to maturity | 382,962 | 406,663 |
Loans held for sale | 414 | |
Loans receivable, net | 1,509,423 | 1,505,097 |
FHLB stock | 5,925 | 6,541 |
FRB stock | 3,106 | 3,103 |
Accrued interest receivable | 5,195 | 5,142 |
Interest rate contracts | 2 | 8 |
Liabilities | ||
Deposits | 1,643,537 | 1,595,992 |
Advances from the Federal Home Loan Bank | 87,327 | 107,019 |
Securities sold under agreements to repurchase | 29,736 | 29,846 |
Accrued interest payable | 370 | 575 |
Interest rate contracts | 2 | 8 |
Estimated Fair Value | Level 1 | ||
Assets | ||
Cash and cash equivalents | 27,672 | 32,089 |
Accrued interest receivable | 8 | 7 |
Estimated Fair Value | Level 2 | ||
Assets | ||
Investment securities available for sale | 2,658 | 2,851 |
Investment securities held to maturity | 382,231 | 405,818 |
Loans held for sale | 414 | |
FHLB stock | 5,925 | 6,541 |
FRB stock | 3,106 | 3,103 |
Accrued interest receivable | 1,014 | 1,045 |
Interest rate contracts | 2 | 8 |
Liabilities | ||
Deposits | 1,267,555 | 1,285,070 |
Advances from the Federal Home Loan Bank | 87,327 | 107,019 |
Securities sold under agreements to repurchase | 29,736 | 29,846 |
Accrued interest payable | 112 | 115 |
Interest rate contracts | 2 | 8 |
Estimated Fair Value | Level 3 | ||
Assets | ||
Investment securities held to maturity | 731 | 845 |
Loans receivable, net | 1,509,423 | 1,505,097 |
Accrued interest receivable | 4,173 | 4,090 |
Liabilities | ||
Deposits | 375,982 | 310,922 |
Accrued interest payable | $ 258 | $ 460 |
Fair Value of Financial Instr72
Fair Value of Financial Instruments - Recurring Basis (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Assets and Liabilities Measured at Fair Value on Recurring Basis | ||
Available-for-sale investments | $ 2,658 | $ 2,851 |
Fair Value, Measurements, Recurring | ||
Assets and Liabilities Measured at Fair Value on Recurring Basis | ||
Interest rate contracts - assets | 2 | 8 |
Interest rate contracts - liabilities | (2) | (8) |
Available-for-sale investments | 2,658 | 2,851 |
Fair Value, Measurements, Recurring | Level 2 | ||
Assets and Liabilities Measured at Fair Value on Recurring Basis | ||
Interest rate contracts - assets | 2 | 8 |
Interest rate contracts - liabilities | (2) | (8) |
Available-for-sale investments | $ 2,658 | $ 2,851 |
Fair Value of Financial Instr73
Fair Value of Financial Instruments - Nonrecurring Basis (Details) - Fair Value, Measurements, Nonrecurring - Impaired loans $ in Thousands | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Assets Measured at Fair Value on Nonrecurring Basis and Related Losses | |
Fair value | $ 87 |
Total Losses | (11) |
Level 2 | |
Assets Measured at Fair Value on Nonrecurring Basis and Related Losses | |
Fair value | $ 87 |
Subsequent Events (Details)
Subsequent Events (Details) - $ / shares | Jul. 26, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 |
Subsequent Events | |||||
Quarterly cash dividend declared on common stock (in dollars per share) | $ 0.30 | $ 0.20 | $ 0.5 | $ 0.40 | |
Subsequent event | |||||
Subsequent Events | |||||
Quarterly cash dividend declared on common stock (in dollars per share) | $ 0.22 |