Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | Apr. 30, 2019 | |
Document and Entity Information | ||
Entity Registrant Name | Midland States Bancorp, Inc. | |
Entity Central Index Key | 0001466026 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2019 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 24,063,471 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Assets | ||
Cash and due from banks | $ 275,939 | $ 210,780 |
Federal funds sold | 541 | 2,920 |
Cash and cash equivalents | 276,480 | 213,700 |
Investment securities available for sale, at fair value | 652,739 | 657,451 |
Equity securities, at fair value | 3,413 | 3,334 |
Loans | 4,092,106 | 4,137,551 |
Allowance for loan losses | (23,091) | (20,903) |
Total loans, net | 4,069,015 | 4,116,648 |
Loans held for sale, at fair value | 16,851 | 30,401 |
Premises and equipment, net | 94,514 | 94,840 |
Operating lease right-of-use asset | 10,677 | |
Other real estate owned | 2,020 | 3,483 |
Nonmarketable equity securities | 46,009 | 42,472 |
Accrued interest receivable | 16,669 | 16,560 |
Mortgage servicing rights, at lower of cost or fair value | 52,957 | 53,447 |
Mortgage servicing rights held for sale | 257 | 3,545 |
Intangible assets | 35,566 | 37,376 |
Goodwill | 164,673 | 164,673 |
Cash surrender value of life insurance policies | 139,686 | 138,783 |
Accrued income taxes receivable | 5,070 | 8,809 |
Deferred tax assets, net | 1,251 | |
Other assets | 55,184 | 50,900 |
Total assets | 5,641,780 | 5,637,673 |
Deposits: | ||
Noninterest-bearing | 941,344 | 972,164 |
Interest-bearing | 3,094,944 | 3,102,006 |
Total deposits | 4,036,288 | 4,074,170 |
Short-term borrowings | 115,832 | 124,235 |
FHLB advances and other borrowings | 669,009 | 640,631 |
Subordinated debt | 94,174 | 94,134 |
Trust preferred debentures | 47,918 | 47,794 |
Accrued interest payable | 6,254 | 4,855 |
Deferred tax liabilities, net | 868 | |
Operating lease liabilities | 11,198 | |
Other liabilities | 36,071 | 43,329 |
Total liabilities | 5,017,612 | 5,029,148 |
Shareholders' Equity: | ||
Preferred stock, Series H, $2 par value; $1,000 per share liquidation value; 2,636 shares authorized, issued and outstanding at March 31, 2019 and December 31, 2018 | 2,733 | 2,781 |
Common stock, $0.01 par value; 40,000,000 shares authorized; 23,827,438 and 23,751,798 shares issued and outstanding at March 31, 2019 and December 31, 2018, respectively | 238 | 238 |
Capital surplus | 475,811 | 473,833 |
Retained earnings | 141,906 | 133,781 |
Accumulated other comprehensive income (loss) | 3,480 | (2,108) |
Total shareholders' equity | 624,168 | 608,525 |
Total liabilities and shareholders' equity | $ 5,641,780 | $ 5,637,673 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
CONSOLIDATED BALANCE SHEETS | ||
Liquidation value | $ 1,000 | $ 1,000 |
Preferred stock, par value | $ 2 | $ 2 |
Preferred stock, shares authorized | 2,636 | 2,636 |
Preferred stock, shares issued | 2,636 | 2,636 |
Preferred stock, shares outstanding | 2,636 | 2,636 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 40,000,000 | 40,000,000 |
Common stock, shares issued | 23,827,438 | 23,751,798 |
Common stock, shares outstanding | 23,827,438 | 23,751,798 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Loans: | ||
Taxable | $ 51,882 | $ 41,031 |
Tax exempt | 974 | 467 |
Loans held for sale | 299 | 428 |
Investment securities: | ||
Taxable | 3,683 | 2,643 |
Tax exempt | 1,066 | 1,016 |
Nonmarketable equity securities | 621 | 399 |
Federal funds sold and cash investments | 907 | 521 |
Total interest income | 59,432 | 46,505 |
Interest expense: | ||
Deposits | 7,363 | 4,117 |
Short-term borrowings | 237 | 124 |
FHLB advances and other borrowings | 3,847 | 1,871 |
Subordinated debt | 1,514 | 1,514 |
Trust preferred debentures | 870 | 694 |
Total interest expense | 13,831 | 8,320 |
Net interest income | 45,601 | 38,185 |
Provision for loan losses | 3,243 | 2,006 |
Net interest income after provision for loan losses | 42,358 | 36,179 |
Noninterest income: | ||
Commercial FHA revenue | 3,270 | 3,330 |
Residential mortgage banking revenue | 834 | 1,418 |
Wealth management revenue | 4,953 | 4,079 |
Service charges on deposit accounts | 2,520 | 1,967 |
Interchange revenue | 2,680 | 2,045 |
Gain on sales of investment securities, net | 65 | |
Gain on sales of other real estate owned | 66 | 307 |
Other income | 2,752 | 3,291 |
Total noninterest income | 17,075 | 16,502 |
Noninterest expense: | ||
Salaries and employee benefits | 22,039 | 28,395 |
Occupancy and equipment | 4,832 | 4,252 |
Data processing | 4,891 | 4,479 |
FDIC insurance | 435 | 548 |
Professional | 2,073 | 3,749 |
Marketing | 1,234 | 1,206 |
Communications | 671 | 1,576 |
Loan expense | 360 | 524 |
Other real estate owned | 93 | 90 |
Amortization of intangible assets | 1,810 | 1,675 |
Other expense | 2,659 | 3,005 |
Total noninterest expense | 41,097 | 49,499 |
Income before income taxes | 18,336 | 3,182 |
Income taxes | 4,354 | 1,376 |
Net income | 13,982 | 1,806 |
Preferred stock dividends and premium amortization | 34 | 36 |
Net income available to common shareholders | $ 13,948 | $ 1,770 |
Per common share data: | ||
Basic earnings per common share | $ 0.58 | $ 0.08 |
Diluted earnings per common share | $ 0.57 | $ 0.08 |
Weighted average common shares outstanding | 23,998,119 | 20,901,738 |
Weighted average diluted common shares outstanding | 24,204,661 | 21,351,511 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||
Net income | $ 13,982 | $ 1,806 |
Investment securities available for sale: | ||
Unrealized gains (losses) that occurred during the period | 7,708 | (3,337) |
Reclassification adjustment for realized net gains on sales of investment securities included in net income | (65) | |
Income tax effect | (2,120) | 924 |
Change in investment securities available for sale, net of tax | 5,588 | (2,478) |
Other comprehensive income (loss), net of tax | 5,588 | (2,478) |
Total comprehensive income (loss) | $ 19,570 | $ (672) |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Preferred stock | Common stock | Capital surplus | Retained earnings | Accumulated other comprehensive (loss) income | Total |
Beginning Balance at Dec. 31, 2017 | $ 2,970 | $ 191 | $ 330,148 | $ 114,478 | $ 1,758 | $ 449,545 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 1,806 | 1,806 | ||||
Other comprehensive income (loss) | (2,478) | (2,478) | ||||
Common dividends declared | (4,239) | (4,239) | ||||
Preferred dividends declared | (83) | (83) | ||||
Preferred stock, premium amortization | (47) | 47 | 47 | |||
Acquisition of Alpine Bancorporation, Inc. | 45 | 139,876 | 139,921 | |||
Share-based compensation expense | 433 | 433 | ||||
Issuance of common stock under employee benefit plans | 480 | 480 | ||||
Ending Balance at Mar. 31, 2018 | 2,923 | 236 | 470,937 | 112,009 | (720) | 585,385 |
Beginning Balance at Dec. 31, 2018 | 2,781 | 238 | 473,833 | 133,781 | (2,108) | 608,525 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 13,982 | 13,982 | ||||
Other comprehensive income (loss) | 5,588 | 5,588 | ||||
Common dividends declared | (5,823) | (5,823) | ||||
Preferred dividends declared | (82) | (82) | ||||
Preferred stock, premium amortization | (48) | 48 | 48 | |||
Share-based compensation expense | 846 | 846 | ||||
Issuance of common stock under employee benefit plans | 1,132 | 1,132 | ||||
Ending Balance at Mar. 31, 2019 | $ 2,733 | $ 238 | $ 475,811 | $ 141,906 | $ 3,480 | $ 624,168 |
CONSOLIDATED STATEMENTS OF SH_2
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY | ||
Common dividend declared, per share | $ 0.2425 | $ 0.22 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Cash flows from operating activities: | ||
Net income | $ 13,982 | $ 1,806 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Provision for loan losses | 3,243 | 2,006 |
Depreciation on premises and equipment | 1,601 | 1,454 |
Amortization of intangible assets | 1,810 | 1,675 |
Amortization of operating lease right-of-use asset | 708 | |
Payments on operating lease obligations | (741) | |
Share-based compensation expense | 846 | 433 |
Increase in cash surrender value of life insurance | (903) | (822) |
Investment securities amortization, net | 964 | 689 |
Gain on sales of investment securities, net | (65) | |
Gain on sales of other real estate owned | (66) | (307) |
Impairment of other real estate owned | 16 | |
Origination of loans held for sale | (84,231) | (122,749) |
Proceeds from sales of loans held for sale | 99,323 | 154,020 |
Gain on loans sold and held for sale | (3,121) | (3,951) |
Loss on disposals of premises and equipment | 7 | 26 |
Amortization of mortgage servicing rights | 678 | 863 |
Impairment of mortgage servicing rights | 25 | 133 |
Net change in operating assets and liabilities: | ||
Accrued interest receivable | (109) | 1,081 |
Accrued interest payable | 1,399 | 1,698 |
Accrued income taxes receivable | 3,739 | 448 |
Operating lease liabilities | 741 | |
Other assets | (1,920) | (131) |
Other liabilities | (7,252) | (429) |
Net cash provided by operating activities | 29,998 | 37,878 |
Investment securities available for sale: | ||
Purchases | (15,565) | (17,375) |
Sales | 1,609 | |
Maturities and payments | 27,023 | 26,022 |
Equity Securities: | ||
Purchases | (16) | (14) |
Net decrease (increase) in loans | 44,390 | (13,051) |
Proceeds from sale of premises and equipment | 7 | |
Purchases of premises and equipment | (1,282) | (1,373) |
Proceeds from sales of mortgage servicing rights held for sale | 3,288 | 10,176 |
Purchases of nonmarketable equity securities | (7,971) | (7,610) |
Sales of nonmarketable equity securities | 4,434 | 5,576 |
Proceeds from sales of other real estate owned | 1,164 | 1,621 |
Net cash acquired in acquisition | 36,153 | |
Net cash provided by investing activities | 55,465 | 41,741 |
Cash flows from financing activities: | ||
Net decrease in deposits | (37,882) | (7,299) |
Net decrease in short-term borrowings | (8,403) | (25,433) |
Proceeds from FHLB borrowings | 195,000 | 217,000 |
Payments made on FHLB borrowings | (165,196) | (144,064) |
Payments made on other borrowings | (1,429) | |
Cash dividends paid on preferred stock | (82) | (83) |
Cash dividends paid on common stock | (5,823) | (4,239) |
Proceeds from issuance of common stock under employee benefit plans | 1,132 | 480 |
Net cash (used in) provided by financing activities | (22,683) | 36,362 |
Net increase in cash and cash equivalents | 62,780 | 115,981 |
Cash and cash equivalents: | ||
Beginning of period | 213,700 | 215,202 |
End of period | 276,480 | 331,183 |
Cash payments for: | ||
Interest paid on deposits and borrowed funds | 12,432 | 6,083 |
Income tax paid | $ 337 | 29 |
Supplemental disclosures of noncash investing and financing activities: | ||
Transfer of investment securities available for sale to equity securities | 2,830 | |
Transfer of loans to other real estate owned | $ 346 |
BUSINESS DESCRIPTION
BUSINESS DESCRIPTION | 3 Months Ended |
Mar. 31, 2019 | |
BUSINESS DESCRIPTION | |
BUSINESS DESCRIPTION | Note 1 – Midland States Bancorp, Inc. (the “Company,” “we,” “our,” or “us”) is a diversified financial holding company headquartered in Effingham, Illinois. Its wholly owned banking subsidiary, Midland States Bank (the “Bank”), has branches across Illinois and in Missouri, and provides a full range of commercial and consumer banking products and services, business equipment financing, merchant credit card services, trust and investment management, and insurance and financial planning services. In addition, multifamily and healthcare facility Federal Housing Administration (“FHA”) financing is provided through Love Funding Corporation (“Love Funding”), our non-bank subsidiary. Our principal business activity has been lending to and accepting deposits from individuals, businesses, municipalities and other entities. We have derived income principally from interest charged on loans and, to a lesser extent, from interest and dividends earned on investment securities. We have also derived income from noninterest sources, such as: fees received in connection with various lending and deposit services; wealth management services; residential mortgage loan originations, sales and servicing; and, from time to time, gains on sales of assets. Our income sources also include Love Funding’s commercial FHA loan origination and servicing income. Our principal expenses include interest expense on deposits and borrowings, operating expenses, such as salaries and employee benefits, occupancy and equipment expenses, data processing costs, professional fees and other noninterest expenses, provisions for loan losses and income tax expense. |
BASIS OF PRESENTATION AND SUMMA
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2019 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | Note 2 – Basis of Presentation and Summary of Significant Accounting Policies Basis of Presentation The consolidated financial statements of the Company are unaudited and should be read in conjunction with the consolidated financial statements and related notes contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018, filed with the Securities and Exchange Commission (the “SEC”) on February 28, 2019. The consolidated financial statements have been prepared in accordance with the accounting principles generally accepted in the United States of America (“GAAP”) and conform to predominant practices within the banking industry. A discussion of these policies can be found in Note 1 – Summary of Significant Accounting Policies included i n the Company's 2018 Annual Report on Form 10-K. There has been one change to our significant accounting policies since December 31, 2018, which is described below. Management of the Company has made a number of estimates and assumptions related to the reporting of assets and liabilities to prepare the consolidated financial statements in conformity with GAAP. Actual results may differ from those estimates. In the opinion of management, all adjustments, consisting of normal recurring accruals considered necessary for a fair presentation of the results of operations for the interim periods presented herein, have been included. Certain reclassifications of 2018 amounts have been made to conform to the 2019 presentation. Management has evaluated subsequent events for potential recognition or disclosure. Operating results for the three months ended March 31, 2019 are not necessarily indicative of the results that may be expected for the year ending December 31, 2019 or any other period. Leases The Company determines if a lease is present at the inception of an agreement. Operating leases are capitalized at commencement and are discounted using the Company’s FHLB borrowing rate for a similar term borrowing unless the lease defines an implicit rate within the contract. For operating leases existing prior to January 1, 2019, the rate for the remaining lease term as of January 1, 2019 was used. The right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease ROU assets and operating lease liabilities are recognized on the lease commencement date based on the present value of lease payments over the lease term. No significant judgments or assumptions were involved in developing the estimated operating lease liabilities as the Company’s operating lease liabilities largely represent future rental expenses associated with operating leases and the borrowing rates are based on publicly available interest rates. Principles of Consolidation The consolidated financial statements include the accounts of the parent company and its subsidiaries. All significant intercompany accounts and transactions have been eliminated. Assets held for customers in a fiduciary or agency capacity, other than trust cash on deposit with the Bank, are not assets of the Company and, accordingly, are not included in the accompanying unaudited consolidated financial statements. Impact of Recently Issued Accounting Standards FASB ASU 2016-02, “Leases (Topic 842)” – In February 2016, the FASB issued ASU No. 2016-02, “ Leases (Topic 842) ,” which requires lessees to recognize leases on-balance sheet and to disclose key information about leasing arrangements. Topic 842 was subsequently amended by ASU No. 2018-10, “ Codification Improvements to Topic 842, Leases;” and ASU No. 2018-11, “Targeted Improvements.” The new standard established a ROU model, that requires a lessee to recognize ROU assets and lease liabilities on the balance sheet for all leases with a term longer than 12 months. Under the new guidance, leases are classified as either finance or operating, with classification affecting the pattern and classification of expense recognition in the statement of income. The Company adopted the new standard on January 1, 2019, and used the effective date as our date of initial application . A modified retrospective adoption approach is required, applying the new standard to all existing leases in effect at the adoption date and new leases going forward. Consequently, financial information will not be updated and the disclosures required under the new standard will not be provided for dates and periods prior to January 1, 2019. This update also allows lessors to not separate non-lease components from the associated lease component if certain conditions are met. The Company elected the “package of practical expedients” permitted by ASU 2018-11, which allows us not to reassess under the new standard our prior conclusions about lease identification, lease classification and initial direct costs. The new standard also provides practical expedients for ongoing accounting. The Company elected the short-term lease recognition exemption for our office equipment leases. This means, for those leases that qualify, we did recognize ROU assets or lease liabilities, and this includes not recognizing ROU assets or lease liabilities for existing short-term leases of those assets in transition. At the adoption date, the Company reported increased assets and liabilities of approximately $12.1 million on its consolidated balance sheet as a result of recognizing ROU assets and lease liabilities related to non-cancelable operating lease agreements for office space. T he adoption of this guidance did not have a material effect to its consolidated statement of income. FASB ASU 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” – In June 2016, the FASB issued ASU No. 2016-13, “ Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“CECL”).” The objective of this update is to improve financial reporting by providing timelier recording of credit losses on loans and other financial instruments held by financial institutions and other organizations. The ASU requires an organization to measure all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will use forward-looking information to better understand their credit loss estimates. For public companies that are filers with the SEC, this update is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. As previously disclosed, the Company has established a cross-functional governance structure, which oversees overall strategy for implementation of Topic 326. Additionally, a working group was formed and has developed a project plan focused on understanding the ASU, researching issues, data requirements, technology solutions and future state processes. The project plan is targeting the data and model validation completion during the second quarter of 2019, with parallel processing of our existing allowance for loan loss model with CECL prior to implementation. The working group has identified 12 distinct loan portfolios for which a model has been or is in the process of being developed. The Company is focused on completing data and model validation, refining assumptions and continued review of the models. The Company also continues to focus on researching and resolving interpretive accounting issues in the ASU, contemplating various related accounting policies, developing processes and related controls and considering various reporting disclosures. The Company also continues to believe that the adoption of the standard will result in an overall increase in the allowance for loan losses to cover credit losses over the estimated life of the financial assets. However, the magnitude of the increase in its allowance for loan losses at the adoption date will depend upon the nature and characteristics of the portfolio at the adoption date, as well as macroeconomic conditions and forecasts at that time. FASB ASU No. 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement” – In August 2018, the FASB issued ASU No. 2018-13 to improve the disclosure requirements on fair value measurements. The amendment removes certain disclosures required by Topic 820 related to transfers between Level 1 and Level 2 of the fair value hierarchy; the policy for timing of transfers between levels; the valuation processes for Level 3 fair value measurements. The update also adds certain disclosure requirements related to changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period and the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. For certain unobservable inputs, an entity may disclose other quantitative information in lieu of the weighted average if the entity determines that other quantitative information would be a more reasonable and rational method to reflect the distribution of unobservable inputs used to develop Level 3 fair value measurements. The amendments in this update become effective for fiscal years, and interim periods within those fiscal years beginning after December 15, 2019, with early adoption permitted. The Company is currently evaluating the impact of adopting the new guidance on its consolidated financial statements, but it is not expected to have a material impact. |
ACQUISITIONS
ACQUISITIONS | 3 Months Ended |
Mar. 31, 2019 | |
ACQUISITIONS | |
ACQUISITIONS | Note 3 – Acquisitions Alpine Bancorporation, Inc. On February 28, 2018, the Company completed its acquisition of Alpine Bancorporation, Inc. (“Alpine”) and its banking subsidiary, Alpine Bank & Trust Co. (“Alpine Bank”), which operated 19 locations in northern Illinois. In the aggregate, the Company acquired Alpine for consideration valued at approximately $173.2 million, which consisted of approximately $33.3 million in cash and the issuance of 4,463,200 shares of the Company’s common stock . The acquisition was accounted for under the acquisition method of accounting. Accordingly, the Company recognized amounts for identifiable assets acquired and liabilities assumed at their estimated acquisition date fair values, while $22.4 million of transaction and integration costs associated with the acquisition were expensed as incurred. As of February 28, 2019, the Company finalized its valuation of all assets acquired liabilities assumed in its acquisition of Alpine, resulting in no material change to acquisition accounting adjustments. |
INVESTMENT SECURITIES
INVESTMENT SECURITIES | 3 Months Ended |
Mar. 31, 2019 | |
INVESTMENT SECURITIES | |
INVESTMENT SECURITIES | Note 4 – Investment Securities Investment securities as of March 31, 2019 and December 31, 2018 were as follows: March 31, 2019 Gross Gross Amortized unrealized unrealized Fair (dollars in thousands) cost gains losses value Available for sale securities U.S. Treasury securities $ 25,009 $ — $ 241 $ 24,768 Government sponsored entity debt securities 75,620 133 166 75,587 Agency mortgage-backed securities 321,127 1,840 1,516 321,451 State and municipal securities 146,557 4,501 146 150,912 Corporate securities 79,626 863 468 80,021 Total available for sale securities $ 647,939 $ 7,337 $ 2,537 $ 652,739 Equity securities $ 3,413 December 31, 2018 Gross Gross Amortized unrealized unrealized Fair (dollars in thousands) cost gains losses value Available for sale securities U.S. Treasury securities $ 25,018 $ — $ 368 $ 24,650 Government sponsored entity debt securities 76,554 17 887 75,684 Agency mortgage-backed securities 329,690 371 3,756 326,305 State and municipal securities 156,795 3,282 815 159,262 Corporate securities 72,302 383 1,135 71,550 Total available for sale securities $ 660,359 $ 4,053 $ 6,961 $ 657,451 Equity securities $ 3,334 Unrealized losses and fair values for investment securities available for sale as of March 31, 2019 and December 31, 2018, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, are summarized as follows: March 31, 2019 Less than 12 Months 12 Months or more Total Fair Unrealized Fair Unrealized Fair Unrealized (dollars in thousands) value loss value loss value loss Available for sale securities U.S. Treasury securities $ 5,004 $ 1 $ 19,764 $ 240 $ 24,768 $ 241 Government sponsored entity debt securities 6,056 8 34,855 158 40,911 166 Agency mortgage-backed securities 13,390 26 124,358 1,490 137,748 1,516 State and municipal securities 5,429 2 16,839 144 22,268 146 Corporate securities 16,096 186 8,804 282 24,900 468 Total available for sale securities $ 45,975 $ 223 $ 204,620 $ 2,314 $ 250,595 $ 2,537 December 31, 2018 Less than 12 Months 12 Months or more Total Fair Unrealized Fair Unrealized Fair Unrealized (dollars in thousands) value loss value loss value loss Available for sale securities U.S. Treasury securities $ 5,012 $ 1 $ 19,638 $ 367 $ 24,650 $ 368 Government sponsored entity debt securities 51,717 195 23,223 692 74,940 887 Agency mortgage-backed securities 139,115 528 126,561 3,228 265,676 3,756 State and municipal securities 15,791 146 27,692 669 43,483 815 Corporate securities 32,616 575 8,535 560 41,151 1,135 Total available for sale securities $ 244,251 $ 1,445 $ 205,649 $ 5,516 $ 449,900 $ 6,961 For all of the above investment securities, the unrealized losses are generally due to changes in interest rates and unrealized losses are considered to be temporary as the fair value is expected to recover as the securities approach maturity date. We evaluate securities for other-than-temporary impairment (“OTTI”) on a quarterly basis, at a minimum, and more frequently when economic or market concerns warrant such evaluation. In estimating OTTI losses, we consider the severity and duration of the impairment; the financial condition and near-term prospects of the issuer, which for debt securities considers external credit ratings and recent downgrades; and the intent and ability of the Company to hold the security for a period of time sufficient for a recovery in value. At March 31, 2019, 141 investment securities available for sale had unrealized losses with aggregate depreciation of 1.0% from their amortized cost basis. The unrealized losses relate principally to the fluctuations in the current interest rate environment. In analyzing an issuer’s financial condition, we consider whether the securities are issued by the federal government or its agencies and whether downgrades by bond rating agencies have occurred. The Company does not have the intent to sell and it is not more likely than not that it will be required to sell a security in an unrealized loss position prior to recovery in value; therefore, the Company does not consider these securities to be other than temporarily impaired at March 31, 2019. For the three months ended March 31, 2019 and 2018 , the Company did not recognize OTTI losses on its investment securities. The following is a summary of the amortized cost and fair value of the available-for-sale investment securities, by maturity, at March 31, 2019. Expected maturities may differ from contractual maturities in mortgage-backed securities because the mortgages underlying the securities may be prepaid without penalties. The maturities of all other available-for-sale investment securities are based on final contractual maturity. Amortized Fair (dollars in thousands) cost value Available for sale securities Within one year $ 45,564 $ 45,610 After one year through five years 110,602 111,624 After five years through ten years 142,380 145,013 After ten years 28,266 29,041 Mortgage-backed securities 321,127 321,451 Total available for sale securities $ 647,939 $ 652,739 There were no sales of securities available for sale during the three months ended March 31, 2019. Proceeds from the sale of securities available for sale were $1.6 million for the three months ended March 31, 2018. Gross realized gains and gross realized losses from the sale of securities available for sale were $65,000 and $0 for the three months ended March 31, 2018, respectively. During the three months ended March 31, 2019 and 2018, the Company recognized net unrealized gains of $67,000 and $111,000, respectively, which was recorded as other income in the consolidated statements of income. There were no sales of equity securities during the three months ended March 31, 2019 and 2018. |
LOANS
LOANS | 3 Months Ended |
Mar. 31, 2019 | |
LOANS | |
LOANS | Note 5 – Loans The following table presents total loans outstanding by portfolio, which includes non-purchased credit impaired (“Non-PCI”) loans and purchased credit impaired (“PCI”) loans, as of March 31, 2019 and December 31, 2018: March 31, 2019 December 31, 2018 Non-PCI PCI Non-PCI PCI (dollars in thousands) Loans Loans (1) Total Loans Loans (1) Total Commercial $ 839,731 $ 3,358 $ 843,089 $ 806,027 $ 4,857 $ 810,884 Commercial real estate 1,542,997 17,430 1,560,427 1,619,903 19,252 1,639,155 Construction and land development 233,332 6,044 239,376 223,898 8,331 232,229 Total commercial loans 2,616,060 26,832 2,642,892 2,649,828 32,440 2,682,268 Residential real estate 560,427 8,624 569,051 569,289 8,759 578,048 Consumer 599,151 1,480 600,631 611,408 1,776 613,184 Lease financing 279,532 — 279,532 264,051 — 264,051 Total loans $ 4,055,170 $ 36,936 $ 4,092,106 $ 4,094,576 $ 42,975 $ 4,137,551 (1) The unpaid principal balance for PCI loans totaled $50.5 million and $56.9 million as of March 31, 2019 and December 31, 2018, respectively. Total loans include net deferred loan fees of $7.3 million and $11.6 million at March 31, 2019 and December 31, 2018, respectively, and unearned income of $32.9 million and $29.2 million within the lease financing portfolio at March 31, 2019 and December 31, 2018, respectively. At March 31, 2019 and December 31, 2018, the Company had commercial and residential loans held for sale totaling $16.9 million and $30.4 million, respectively. During the three months ended March 31, 2019 and 2018, the Company sold commercial and residential real estate loans with proceeds totaling $99.3 million and $154.0 million, respectively. The aggregate loans outstanding to the directors, executive officers, principal shareholders and their affiliates totaled $23.5 million and $26.5 million at March 31, 2019 and December 31, 2018, respectively. During the three months ended March 31, 2019, there were $1.5 million of new loans and other additions, while repayments and other reductions totaled $4.5 million. Credit Quality Monitoring The Company maintains loan policies and credit underwriting standards as part of the process of managing credit risk. These standards include making loans generally within the Company’s four main regions, which include eastern, northern and southern Illinois and the St. Louis metropolitan area. Our equipment leasing business provides financing to business customers across the country. The Company has a loan approval process involving underwriting and individual and group loan approval authorities to consider credit quality and loss exposure at loan origination. The loans in the Company’s commercial loan portfolio are risk rated at origination based on the grading system set forth below. All loan authority is based on the aggregate credit to a borrower and its related entities. The Company’s consumer loan portfolio is primarily comprised of both secured and unsecured loans that are relatively small and are evaluated at origination on a centralized basis against standardized underwriting criteria. The ongoing measurement of credit quality of the consumer loan portfolio is largely done on an exception basis. If payments are made on schedule, as agreed, then no further monitoring is performed. However, if delinquency occurs, the delinquent loans are turned over to the Company’s Consumer Collections Group for resolution. Credit quality for the entire consumer loan portfolio is measured by the periodic delinquency rate, nonaccrual amounts and actual losses incurred. Loans in the commercial loan portfolio tend to be larger and more complex than those in the other loan portfolio, and therefore, are subject to more intensive monitoring. All loans in the commercial loan portfolio have an assigned relationship manager, and most borrowers provide periodic financial and operating information that allows the relationship managers to stay abreast of credit quality during the life of the loans. The risk ratings of loans in the commercial loan portfolio are reassessed at least annually, with loans below an acceptable risk rating reassessed more frequently and reviewed by various individuals within the Company at least quarterly. The Company maintains a centralized independent loan review function that monitors the approval process and ongoing asset quality of the loan portfolio, including the accuracy of loan grades. The Company also maintains an independent appraisal review function that participates in the review of all appraisals obtained by the Company. Credit Quality Indicators The Company uses a ten grade risk rating system to monitor the ongoing credit quality of its commercial loan portfolio. These loan grades rank the credit quality of a borrower by measuring liquidity, debt capacity, and coverage and payment behavior as shown in the borrower’s financial statements. The risk grades also measure the quality of the borrower’s management and the repayment support offered by any guarantors. The Company considers all loans with Risk Grades of 1 – 6 as acceptable credit risks and structures and manages such relationships accordingly. Periodic financial and operating data combined with regular loan officer interactions are deemed adequate to monitor borrower performance. Loans with Risk Grades of 7 are considered “watch credits” and the frequency of loan officer contact and receipt of financial data is increased to stay abreast of borrower performance. Loans with Risk Grades of 8 – 10 are considered problematic and require special care. Further, loans with Risk Grades of 7 – 10 are managed and monitored regularly through a number of processes, procedures and committees, including oversight by a loan administration committee comprised of executive and senior management of the Company, which includes highly structured reporting of financial and operating data, intensive loan officer intervention and strategies to exit, as well as potential management by the Company’s Special Assets Group. Loans not graded in the commercial loan portfolio are monitored by aging status and payment activity. The following table presents the recorded investment of the commercial loan portfolio (excluding PCI loans) by risk category as of March 31, 2019 and December 31, 2018: March 31, 2019 December 31, 2018 Commercial Construction Commercial Construction Real and Land Real and Land (dollars in thousands) Commercial Estate Development Total Commercial Estate Development Total Acceptable credit quality $ 788,619 $ 1,449,480 $ 227,953 $ 2,466,052 $ 748,296 $ 1,536,127 $ 218,798 $ 2,503,221 Special mention 21,121 14,627 2,522 38,270 35,103 15,306 3,448 53,857 Substandard 21,498 51,574 890 73,962 14,139 46,976 — 61,115 Substandard – nonaccrual 8,493 27,316 1,168 36,977 8,489 21,494 1,171 31,154 Doubtful — — — — — — — — Not graded — — 799 799 — — 481 481 Total (excluding PCI) $ 839,731 $ 1,542,997 $ 233,332 $ 2,616,060 $ 806,027 $ 1,619,903 $ 223,898 $ 2,649,828 The Company evaluates the credit quality of its other loan portfolio based primarily on the aging status of the loan and payment activity. Accordingly, loans on nonaccrual status, loans past due 90 days or more and still accruing interest, and loans modified under troubled debt restructurings are considered to be impaired for purposes of credit quality evaluation. The following table presents the recorded investment of our other loan portfolio (excluding PCI loans) based on the credit risk profile of loans that are performing and loans that are impaired as of March 31, 2019 and December 31, 2018: March 31, 2019 December 31, 2018 Residential Lease Residential Lease (dollars in thousands) Real Estate Consumer Financing Total Real Estate Consumer Financing Total Performing $ 552,674 $ 598,618 $ 278,284 $ 1,429,576 $ 562,019 $ 610,839 $ 263,094 $ 1,435,952 Impaired 7,753 533 1,248 9,534 7,270 569 957 8,796 Total (excluding PCI) $ 560,427 $ 599,151 $ 279,532 $ 1,439,110 $ 569,289 $ 611,408 $ 264,051 $ 1,444,748 Impaired Loans Impaired loans include loans on nonaccrual status, loans past due 90 days or more and still accruing interest and loans modified under troubled debt restructurings. Impaired loans at March 31, 2019 and December 31, 2018 do not include $36.9 million and $43.0 million, respectively, of PCI loans. The risk of credit loss on acquired loans was recognized as part of the fair value adjustment at the acquisition date. There was no interest income recognized on nonaccrual loans during the three months ended March 31, 2019 and 2018 while the loans were in nonaccrual status. Additional interest income that would have been recorded on nonaccrual loans had they been current in accordance with their original terms was $653,000 and $500,000 for the three months ended March 31, 2019 and 2018, respectively. The Company recognized interest income on commercial and commercial real estate loans modified under troubled debt restructurings of $32,000 and $30,000 for the three months ended March 31, 2019 and 2018, respectively. The following table presents impaired loans (excluding PCI loans) by portfolio and related valuation allowance as of March 31, 2019 and December 31, 2018: March 31, 2019 December 31, 2018 Unpaid Related Unpaid Related Recorded Principal Valuation Recorded Principal Valuation (dollars in thousands) Investment Balance Allowance Investment Balance Allowance Impaired loans with a valuation allowance: Commercial $ 8,191 $ 8,356 $ 4,730 $ 7,945 $ 8,102 $ 4,448 Commercial real estate 5,592 6,221 2,437 7,496 13,844 523 Construction and land development 125 169 14 171 171 54 Residential real estate 4,457 5,203 512 4,055 4,662 554 Consumer 522 547 41 428 444 45 Lease financing 436 436 146 766 766 361 Total impaired loans with a valuation allowance 19,323 20,932 7,880 20,861 27,989 5,985 Impaired loans with no related valuation allowance: Commercial 708 4,124 — 983 4,392 — Commercial real estate 24,019 30,492 — 16,372 16,921 — Construction and land development 1,093 1,093 — 1,136 1,136 — Residential real estate 3,296 3,557 — 3,215 3,516 — Consumer 11 13 — 141 145 — Lease financing 812 813 — 191 191 — Total impaired loans with no related valuation allowance 29,939 40,092 — 22,038 26,301 — Total impaired loans: Commercial 8,899 12,480 4,730 8,928 12,494 4,448 Commercial real estate 29,611 36,713 2,437 23,868 30,765 523 Construction and land development 1,218 1,262 14 1,307 1,307 54 Residential real estate 7,753 8,760 512 7,270 8,178 554 Consumer 533 560 41 569 589 45 Lease financing 1,248 1,249 146 957 957 361 Total impaired loans (excluding PCI) $ 49,262 $ 61,024 $ 7,880 $ 42,899 $ 54,290 $ 5,985 The difference between a loan’s recorded investment and the unpaid principal balance represents: (1) a partial charge-off resulting from a confirmed loss due to the value of the collateral securing the loan being below the loan’s principal balance and management’s assessment that the full collection of the loan balance is not likely and/or (2) payments received on nonaccrual loans that are fully applied to principal on the loan’s recorded investment as compared to being applied to principal and interest on the unpaid customer principal and interest balance. The difference between the recorded investment and the unpaid principal balance on loans was $11.8 million and $11.4 million at March 31, 2019 and December 31, 2018, respectively. The average balance of impaired loans (excluding PCI loans) and interest income recognized on impaired loans during the three months ended March 31, 2019 and 2018 are included in the table below: Three Months Ended March 31, 2019 2018 Interest Income Interest Income Average Recognized Average Recognized Recorded While on Recorded While on (dollars in thousands) Investment Impaired Status Investment Impaired Status Impaired loans with a valuation allowance: Commercial $ 8,240 $ 6 $ 2,291 $ 10 Commercial real estate 5,563 27 2,104 20 Construction and land development 141 — 101 1 Residential real estate 4,465 10 3,579 10 Consumer 527 — 208 — Lease financing 436 — 1,014 — Total impaired loans with a valuation allowance 19,372 43 9,297 41 Impaired loans with no related valuation allowance: Commercial 723 — 518 — Commercial real estate 24,153 — 13,731 — Construction and land development 1,110 1 739 — Residential real estate 3,306 2 2,370 1 Consumer 12 — 42 — Lease financing 813 — 247 — Total impaired loans with no related valuation allowance 30,117 3 17,647 1 Total impaired loans: Commercial 8,963 6 2,809 10 Commercial real estate 29,716 27 15,835 20 Construction and land development 1,251 1 840 1 Residential real estate 7,771 12 5,949 11 Consumer 539 — 250 — Lease financing 1,249 — 1,261 — Total impaired loans (excluding PCI) $ 49,489 $ 46 $ 26,944 $ 42 The aging status of the recorded investment in loans by portfolio (excluding PCI loans) as of March 31, 2019 and December 31, 2018 were as follows: Accruing 30-59 60-89 Past Due Days Days 90 Days Total Total (dollars in thousands) Past Due Past Due or More Nonaccrual Past Due Current Loans March 31, 2019 Commercial $ 2,323 $ 2,147 $ — $ 8,493 $ 12,963 $ 826,768 $ 839,731 Commercial real estate 4,862 1,160 — 27,316 33,338 1,509,659 1,542,997 Construction and land development 1,020 160 — 1,168 2,348 230,984 233,332 Residential real estate 1,305 716 — 6,884 8,905 551,522 560,427 Consumer 4,735 3,365 — 431 8,531 590,620 599,151 Lease financing 1,829 377 255 993 3,454 276,078 279,532 Total (excluding PCI) $ 16,074 $ 7,925 $ 255 $ 45,285 $ 69,539 $ 3,985,631 $ 4,055,170 December 31, 2018 Commercial $ 4,013 $ 2,581 $ 4 $ 8,489 $ 15,087 $ 790,940 $ 806,027 Commercial real estate 1,667 945 149 21,494 24,255 1,595,648 1,619,903 Construction and land development 989 — 85 1,171 2,245 221,653 223,898 Residential real estate 1,292 728 566 5,894 8,480 560,809 569,289 Consumer 5,211 2,533 51 388 8,183 603,225 611,408 Lease financing 4,322 932 206 751 6,211 257,840 264,051 Total (excluding PCI) $ 17,494 $ 7,719 $ 1,061 $ 38,187 $ 64,461 $ 4,030,115 $ 4,094,576 Troubled Debt Restructurings Loans modified as TDRs for commercial and commercial real estate loans generally consist of allowing commercial borrowers to defer scheduled principal payments and make interest only payments for a specified period of time at the stated interest rate of the original loan agreement or lower payments due to a modification of the loans’ contractual terms. TDRs that continue to accrue interest and are greater than $50,000 are individually evaluated for impairment on a quarterly basis, and transferred to nonaccrual status when it is probable that any remaining principal and interest payments due on the loan will not be collected in accordance with the contractual terms of the loan. TDRs that subsequently default are individually evaluated for impairment at the time of default. The allowance for loan losses on TDRs totaled $446,000 and $557,000 as of March 31, 2019 and December 31, 2018, respectively. The Company had no unfunded commitments in connection with TDRs at March 31, 2019 and December 31, 2018. The Company’s TDRs are identified on a case-by-case basis in connection with the ongoing loan collection processes. The following table presents TDRs by loan portfolio (excluding PCI loans) as of March 31, 2019 and December 31, 2018: March 31, 2019 December 31, 2018 (dollars in thousands) Accruing (1) Non-accrual (2) Total Accruing (1) Non-accrual (2) Total Commercial $ 406 $ 399 $ 805 $ 435 $ 406 $ 841 Commercial real estate 2,295 10,713 13,008 2,225 9,103 11,328 Construction and land development 50 17 67 51 — 51 Residential real estate 869 1,398 2,267 810 853 1,663 Consumer 102 — 102 130 — 130 Lease financing — — — — — — Total loans (excluding PCI) $ 3,722 $ 12,527 $ 16,249 $ 3,651 $ 10,362 $ 14,013 (1) These loans are still accruing interest. (2) These loans are included in non-accrual loans in the preceding tables. The following table presents a summary of loans by portfolio that were restructured during the three months ended March 31, 2019 and the loans by portfolio that were modified as TDRs within the previous twelve months that subsequently defaulted during the three months ended March 31, 2019: Commercial Loan Portfolio Other Loan Portfolio Commercial Construction Residential Real and Land Real Lease (dollars in thousands) Commercial Estate Development Estate Consumer Financing Total For the three months ended March 31, 2019 Troubled debt restructurings: Number of loans — 3 1 7 1 — 12 Pre-modification outstanding balance $ — $ 1,924 $ 62 $ 224 $ 15 $ — $ 2,225 Post-modification outstanding balance — 1,838 17 222 15 — 2,092 Troubled debt restructurings that subsequently defaulted Number of loans — — 1 — — — 1 Recorded balance $ — $ — $ 43 $ — $ — $ — $ 43 During the three months ended March 31, 2018, there were no loans restructured. There were also no loans modified as TDRs within the previous twelve months that subsequently defaulted during the three months ended March 31, 2018. Purchased Credit Impaired Loans The Company has purchased loans for which there was, at acquisition, evidence of deterioration of credit quality since origination and it was probable, at acquisition, that all contractually required payments would not be collected. Accretable yield of PCI loans, or income expected to be collected, was as follows: Three Months Ended March 31, (dollars in thousands) 2019 2018 Balance, at beginning of period $ 12,240 $ 5,732 New loans purchased – Alpine acquisition — 842 Accretion (1,076) (1,161) Other adjustments (including maturities, charge-offs and impact of changes in timing of expected cash flows) (106) 660 Reclassification from non-accretable 5 1,154 Balance, at end of period $ 11,063 $ 7,227 Accretion recorded as loan interest income totaled $1.1 million and $1.2 million during the three months ended March 31, 2019 and 2018, respectively. Allowance for Loan Losses The Company’s loan portfolio is principally comprised of commercial, commercial real estate, construction and land development, residential real estate and consumer loans and lease financing receivables. The principal risks to each category of loans are as follows: Commercial – The principal risk of commercial loans is that these loans are primarily made based on the identified cash flow of the borrower and secondarily on the collateral underlying the loans. Most often, this collateral consists of accounts receivable, inventory and equipment. Inventory and equipment may depreciate over time, may be difficult to appraise and may fluctuate in value based on the success of the business. If the cash flow from business operations is reduced, the borrower’s ability to repay the loan may be impaired. As such, repayment of such loans is often more sensitive than other types of loans to adverse conditions in the general economy. Commercial real estate – As with commercial loans, repayment of commercial real estate loans is often dependent on the borrower’s ability to make repayment from the cash flow of the commercial venture. While commercial real estate loans are collateralized by the borrower’s underlying real estate, foreclosure on such assets may be more difficult than with other types of collateralized loans because of the possible effect the foreclosure would have on the borrower’s business, and property values may tend to be partially based upon the value of the business situated on the property. Construction and land development – Construction and land development lending involves additional risks not generally present in other types of lending because funds are advanced upon the estimated future value of the project, which is uncertain prior to its completion and at the time the loan is made, and costs may exceed realizable values in declining real estate markets. Moreover, if the estimate of the value of the completed project proves to be overstated or market values or rental rates decline, the collateral may prove to be inadequate security for the repayment of the loan. Additional funds may also be required to complete the project, and the project may have to be held for an unspecified period of time before a disposition can occur. Residential real estate – The principal risk to residential real estate lending is associated with residential loans not sold into the secondary market. In such cases, the value of the underlying property may have deteriorated as a result of a change in the residential real estate market, and the borrower may have little incentive to repay the loan or continue living in the property. Additionally, in areas with high vacancy rates, reselling the property without substantial loss may be difficult. Consumer – The repayment of consumer loans is typically dependent on the borrower remaining employed through the life of the loan, as well as the possibility that the collateral underlying the loan, if applicable, may not be adequately maintained by the borrower. Lease financing – Our financing leases are primarily for business equipment leased to varying types of businesses, nationwide, for the purchase of business equipment and software. If the cash flow from business operations is reduced, the business’s ability to repay may become impaired. The following table represents, by loan portfolio, a summary of changes in the allowance for loan losses for the three months ended March 31, 2019 and 2018: Commercial Loan Portfolio Other Loan Portfolio Commercial Construction Residential Real and Land Real Lease (dollars in thousands) Commercial Estate Development Estate Consumer Financing Total Changes in allowance for loan losses for the three months ended March 31, 2019: Balance, beginning of period $ 9,524 $ 4,723 $ 372 $ 2,041 $ 2,154 $ 2,089 $ 20,903 Provision for loan losses 118 1,945 63 514 329 274 3,243 Charge-offs (112) (58) (44) (153) (556) (459) (1,382) Recoveries 15 7 7 22 210 66 327 Balance, end of period $ 9,545 $ 6,617 $ 398 $ 2,424 $ 2,137 $ 1,970 $ 23,091 Changes in allowance for loan losses for the three months ended March 31, 2018: Balance, beginning of period $ 5,256 $ 5,044 $ 518 $ 2,750 $ 1,344 $ 1,519 $ 16,431 Provision for loan losses 567 507 (215) (261) 304 1,104 2,006 Charge-offs (25) (160) — (36) (434) (486) (1,141) Recoveries 104 94 25 51 95 39 408 Balance, end of period $ 5,902 $ 5,485 $ 328 $ 2,504 $ 1,309 $ 2,176 $ 17,704 The following table represents, by loan portfolio, details regarding the balance in the allowance for loan losses and the recorded investment in loans as of March 31, 2019 and December 31, 2018 by impairment evaluation method: Commercial Loan Portfolio Other Loan Portfolio Commercial Construction Residential Real and Land Real Lease (dollars in thousands) Commercial Estate Development Estate Consumer Financing Total March 31, 2019: Allowance for loan losses: Loans individually evaluated for impairment $ 4,671 $ 2,391 $ — $ 177 $ — $ 114 $ 7,353 Loans collectively evaluated for impairment 59 46 14 335 41 32 527 Non-impaired loans collectively evaluated for impairment 4,797 3,375 384 1,481 1,898 1,824 13,759 Loans acquired with deteriorated credit quality (1) 18 805 — 431 198 — 1,452 Total allowance for loan losses $ 9,545 $ 6,617 $ 398 $ 2,424 $ 2,137 $ 1,970 $ 23,091 Recorded investment (loan balance): Impaired loans individually evaluated for impairment $ 8,354 $ 29,186 $ 1,093 $ 4,408 $ — $ 957 $ 43,998 Impaired loans collectively evaluated for impairment 545 425 125 3,345 533 291 5,264 Non-impaired loans collectively evaluated for impairment 830,832 1,513,386 232,114 552,674 598,618 278,284 4,005,908 Loans acquired with deteriorated credit quality (1) 3,358 17,430 6,044 8,624 1,480 — 36,936 Total recorded investment (loan balance) $ 843,089 $ 1,560,427 $ 239,376 $ 569,051 $ 600,631 $ 279,532 $ 4,092,106 December 31, 2018: Allowance for loan losses: Loans individually evaluated for impairment $ 4,405 $ 476 $ 48 $ 233 $ — $ 330 $ 5,492 Loans collectively evaluated for impairment 43 47 6 321 45 31 493 Non-impaired loans collectively evaluated for impairment 4,971 3,356 318 1,051 1,926 1,728 13,350 Loans acquired with deteriorated credit quality (1) 105 844 — 436 183 — 1,568 Total allowance for loan losses $ 9,524 $ 4,723 $ 372 $ 2,041 $ 2,154 $ 2,089 $ 20,903 Recorded investment (loan balance): Impaired loans individually evaluated for impairment $ 8,520 $ 23,431 $ 1,249 $ 3,929 $ 5 $ 668 $ 37,802 Impaired loans collectively evaluated for impairment 408 437 58 3,341 564 289 5,097 Non-impaired loans collectively evaluated for impairment 797,099 1,596,035 222,591 562,019 610,839 263,094 4,051,677 Loans acquired with deteriorated credit quality (1) 4,857 19,252 8,331 8,759 1,776 — 42,975 Total recorded investment (loan balance) $ 810,884 $ 1,639,155 $ 232,229 $ 578,048 $ 613,184 $ 264,051 $ 4,137,551 (1) Loans acquired with deteriorated credit quality were originally recorded at fair value at the acquisition date and the risk of credit loss was recognized at that date based on estimates of expected cash flows |
PREMISES AND EQUIPMENT, NET
PREMISES AND EQUIPMENT, NET | 3 Months Ended |
Mar. 31, 2019 | |
PREMISES AND EQUIPMENT | |
PREMISES AND EQUIPMENT, NET | Note 6 – Premises and Equipment, Net A summary of premises and equipment as of March 31, 2019 and December 31, 2018 is as follows: March 31, December 31, (dollars in thousands) 2019 2018 Land $ 20,231 $ 20,231 Buildings and improvements 77,290 76,141 Furniture and equipment 29,873 29,858 Total 127,394 126,230 Accumulated depreciation (32,880) (31,390) Premises and equipment, net $ 94,514 $ 94,840 Depreciation expense of $1.6 million and $1.5 million was recorded for the three months ended March 31, 2019 and 2018, respectively. |
MORTGAGE SERVICING RIGHTS
MORTGAGE SERVICING RIGHTS | 3 Months Ended |
Mar. 31, 2019 | |
MORTGAGE SERVICING RIGHTS | |
MORTGAGE SERVICING RIGHTS | Note 7 – Mortgage Servicing Rights The Company serviced commercial FHA mortgage loans for others with unpaid principal balances of approximately $3.97 billion and $3.98 billion at March 31, 2019 and December 31, 2018, respectively. Changes in our commercial FHA mortgage servicing rights were as follows for the three months ended March 31, 2019 and 2018: Three Months Ended March 31, (dollars in thousands) 2019 2018 Mortgage servicing rights: Balance, beginning of period $ 56,252 $ 55,714 Originated servicing 213 1,001 Amortization (678) (676) Balance, end of period 55,787 56,039 Valuation allowances: Balance, beginning of period 2,805 3,254 Additions 25 133 Reductions — — Balance, end of period 2,830 3,387 Mortgage servicing rights, net $ 52,957 $ 52,652 Fair value: At beginning of period $ 53,447 $ 52,460 At end of period $ 52,957 $ 52,652 The following table is a summary of key assumptions, representing both general economic and other published information and the weighted average characteristics of the commercial portfolio, used in the valuation of servicing rights at March 31, 2019 and December 31, 2018. Assumptions used in the prepayment rate consider many factors as appropriate, including lockouts, balloons, prepayment penalties, interest rate ranges, delinquencies and geographic location. The discount rate is based on an average pre‑tax internal rate of return utilized by market participants in pricing the servicing portfolio. Significant increases or decreases in any one of these assumptions would result in a significantly lower or higher fair value measurement. Remaining Servicing Interest Years to Prepayment Servicing Discount (dollars in thousands) Fee Rate Maturity Rate Cost Rate March 31, 2019: Commercial FHA mortgage loans 0.13 % 3.67 % 30.0 8.21 % $ 1,000 10 - 14 % December 31, 2018: Commercial FHA mortgage loans 0.13 % 3.67 % 30.1 8.24 % $ 1,000 10 - 14 % We recognize revenue from servicing commercial FHA and residential mortgages as earned based on the specific contractual terms. This revenue, along with amortization of and changes in impairment on servicing rights, is reported in commercial FHA revenue and residential mortgage banking revenue in the consolidated statements of income. Mortgage servicing rights do not trade in an active market with readily observable prices. The fair value of mortgage servicing rights and their sensitivity to changes in interest rates is influenced by the mix of the servicing portfolio and characteristics of each segment of the portfolio. The Company’s servicing portfolio consists of the distinct portfolios of government-insured residential and commercial mortgages and conventional residential mortgages. T he fair value of our servicing rights is estimated by using a cash flow valuation model which calculates the present value of estimated future net servicing cash flows, taking into consideration expected mortgage loan prepayment rates, discount rates, cost to service, contractual servicing fee income, ancillary income, late fees , replacement reserves and other economic factors that are determined based on current market conditions. At March 31, 2019 and December 31, 2018, the Company serviced residential mortgage loans for others with unpaid principal balances of approximately $861.9 million and $897.6 million, respectively. During the first quarters of 2019 and 2018, the Company sold mortgage servicing rights held for sale of $3.3 million and $10.2 million, respectively. At March 31, 2019, total residential mortgage servicing rights of $257,000 are reflected in the consolidated balance sheet as mortgage servicing rights held for sale. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 3 Months Ended |
Mar. 31, 2019 | |
GOODWILL AND INTANGIBLE ASSETS | |
GOODWILL AND INTANGIBLE ASSETS | Note 8 – Goodwill and Intangible Assets At March 31, 2019 and December 31, 2018, goodwill totaled $164.7 million. The following table summarizes the carrying amount of goodwill by segment at both March 31, 2019 and December 31, 2018. (dollars in thousands) Goodwill Banking $ 149,035 Commercial FHA origination and servicing 10,892 Wealth management 4,746 Total goodwill $ 164,673 The Company’s intangible assets, consisting of core deposit and customer relationship intangibles, as of March 31, 2019 and December 31, 2018 are summarized as follows: March 31, 2019 December 31, 2018 Gross Gross Carrying Accumulated Carrying Accumulated (dollars in thousands) Amount Amortization Total Amount Amortization Total Core deposit intangibles $ 52,712 $ (26,309) $ 26,403 $ 52,712 $ (24,803) $ 27,909 Customer relationship intangibles 13,771 (4,608) 9,163 13,771 (4,304) 9,467 Total intangible assets $ 66,483 $ (30,917) $ 35,566 $ 66,483 $ (29,107) $ 37,376 Amortization of intangible assets was $1.8 million and $1.7 million for the three months ended March 31, 2019 and 2018, respectively. |
DERIVATIVE INSTRUMENTS
DERIVATIVE INSTRUMENTS | 3 Months Ended |
Mar. 31, 2019 | |
DERIVATIVE INSTRUMENTS | |
DERIVATIVE INSTRUMENTS | Note 9 – Derivative Instruments As part of the Company’s overall management of interest rate sensitivity, the Company utilizes derivative instruments to minimize significant, unanticipated earnings fluctuations caused by interest rate volatility, including interest rate lock commitments, forward commitments to sell mortgage-backed securities and interest rate swap contracts. Interest Rate Lock Commitments / Forward Commitments to Sell Mortgage-Backed Securities The Company issues interest rate lock commitments on originated fixed-rate commercial and residential real estate loans to be sold. The interest rate lock commitments and loans held for sale are hedged with forward contracts to sell mortgage-backed securities. The fair value of the interest rate lock commitments and forward contracts to sell mortgage-backed securities are included in other assets or other liabilities in the consolidated balance sheets. Changes in the fair value of derivative financial instruments are recognized in commercial FHA revenue and residential mortgage banking revenue in the consolidated statements of income. The following table summarizes the interest rate lock commitments and forward commitments to sell mortgage-backed securities held by the Company, their notional amount and estimated fair values at March 31, 2019 and December 31, 2018: Notional Amount Fair Value Gain March 31, December 31, March 31, December 31, (dollars in thousands) 2019 2018 2019 2018 Derivative Instruments (included in Other Assets): Interest rate lock commitments $ 275,324 $ 264,710 $ 5,752 $ 4,492 Forward commitments to sell mortgage-backed securities 274,234 276,871 — — Total $ 549,558 $ 541,581 $ 5,752 $ 4,492 Notional Amount Fair Value Loss March 31, December 31, March 31, December 31, (dollars in thousands) 2019 2018 2019 2018 Derivative Instruments (included in Other Liabilities): Forward commitments to sell mortgage-backed securities $ 67 $ 54 $ — $ — During the three months ended March 31, 2019, the Company recognized net gains of $1.3 million on derivative instruments in commercial FHA revenue and residential mortgage banking revenue in the consolidated statements of income. During the three months ended March 31, 2018, the Company recognized net losses of $74,000 on derivative instruments in commercial FHA revenue and residential mortgage banking revenue in the consolidated statements of income. Interest Rate Swap Contracts The Company entered into interest rate swap contracts sold to commercial customers who wish to modify their interest rate sensitivity. These swaps are offset by contracts simultaneously purchased by the Company from other financial dealer institutions with mirror-image terms. Because of the mirror-image terms of the offsetting contracts, in addition to collateral provisions which mitigate the impact of non-performance risk, changes in the fair value subsequent to initial recognition have a minimal effect on earnings. These derivative contracts do not qualify for hedge accounting. The notional amounts of these customer derivative instruments and the offsetting counterparty derivative instruments were $9.4 million and $9.5 million at March 31, 2019 and December 31, 2018, respectively. The fair value of the customer derivative instruments and the offsetting counterparty derivative instruments was $18,000 and $145,000 at March 31, 2019 and December 31, 2018, respectively, which are included in other assets and other liabilities, respectively, on the consolidated balance sheets. |
DEPOSITS
DEPOSITS | 3 Months Ended |
Mar. 31, 2019 | |
DEPOSITS | |
DEPOSITS | Note 10 – Deposits The following table summarizes the classification of deposits as of March 31, 2019 and December 31, 2018: March 31, December 31, (dollars in thousands) 2019 2018 Noninterest-bearing demand $ 941,344 $ 972,164 Interest-bearing: Checking 968,844 1,002,275 Money market 802,036 862,171 Savings 457,176 442,132 Time 866,888 795,428 Total deposits $ 4,036,288 $ 4,074,170 |
SHORT-TERM BORROWINGS
SHORT-TERM BORROWINGS | 3 Months Ended |
Mar. 31, 2019 | |
SHORT-TERM BORROWINGS | |
SHORT-TERM BORROWINGS | Note 11 – Short-Term Borrowings The following table presents the distribution of short-term borrowings and related weighted average interest rates as of March 31, 2019 and December 31, 2018: Repurchase Agreements March 31, December 31, (dollars in thousands) 2019 2018 Outstanding at period-end $ 115,832 $ 124,235 Average amount outstanding 135,337 138,135 Maximum amount outstanding at any month end 138,907 173,387 Weighted average interest rate: During period 0.71 % 0.51 % End of period 0.73 % 0.71 % Securities sold under agreements to repurchase, which are classified as secured borrowings, generally mature within one to four days from the transaction date. Securities sold under agreements to repurchase are reflected at the amount of cash received in connection with the transaction, which represents the amount of the Bank’s obligation. The Bank may be required to provide additional collateral based on the fair value of the underlying securities. Investment securities with a carrying amount of $123.4 million and $132.2 million at March 31, 2019 and December 31, 2018, respectively, were pledged for securities sold under agreements to repurchase. The Company had lines of credit of $50.0 million and $56.8 million at March 31, 2019 and December 31, 2018, respectively, from the Federal Reserve Discount Window. The lines are collateralized by a collateral agreement with respect to a pool of commercial real estate loans totaling $59.4 million and $67.6 million at March 31, 2019 and December 31, 2018, respectively. There were no outstanding borrowings at March 31, 2019 and December 31, 2018. At March 31, 2019, the Company had available federal funds lines of credit totaling $45.0 million. These lines of credit were unused at March 31, 2019. |
FHLB ADVANCES AND OTHER BORROWI
FHLB ADVANCES AND OTHER BORROWINGS | 3 Months Ended |
Mar. 31, 2019 | |
FHLB ADVANCES AND OTHER BORROWINGS | |
FHLB ADVANCES AND OTHER BORROWINGS | Note 12 – FHLB Advances and Other Borrowings The following table summarizes our Federal Home Loan Bank (“FHLB”) advances and other borrowings as of March 31, 2019 and December 31, 2018: March 31, December 31, (dollars in thousands) 2019 2018 Midland States Bancorp, Inc. Term loan - variable interest rate equal to LIBOR plus 2.25%, which was 4.75% and 4.63% at March 31, 2019 and December 31, 2018, respectively, – maturing May 25, 2020 $ $ 32,840 Series G redeemable preferred stock - 181 shares at $1,000 per share Midland States Bank FHLB advances – fixed rate, fixed term of $62.5 million and $87.7 million, at rates averaging 2.50% and 2.35% at March 31, 2019 and December 31, 2018, respectively – maturing through February 2023 and putable fixed rate of $565.0 million and $520.0 million at rates averaging 2.11% and 2.09% at March 31, 2019 and December 31, 2018, respectively – maturing through August 2025 with call provisions through August 2021 627,414 607,610 FHLB advances – variable rate, fixed term, at a rate averaging 2.60% at March 31, 2019 – maturing in June 2019 10,000 — Total FHLB advances and other borrowings $ 669,009 $ 640,631 In May 2017, the Company entered into a loan agreement with another bank for a revolving line of credit in the original principal amount of up to $10.0 million and a term loan in the original principal amount of $40.0 million. The term loan matures on May 25, 2020 and has a variable rate of interest equal to one-month LIBOR plus 2.25%. Beginning September 1, 2018, the Company was required to make quarterly principal and interest payments on the term loan of $1.4 million with the remaining principal and any unpaid interest due at maturity. The loan is unsecured with a negative pledge of shares of the Bank’s common stock. The loan agreement contains financial covenants that require the Company to maintain a minimum total capital to risk-weighted assets ratio, a minimum adjusted loan loss reserves to nonperforming loans ratio, a minimum fixed charge coverage ratio and a maximum percentage of nonperforming assets to tangible capital. At March 31, 2019, the Company was in compliance with each of these financial covenants. The Company’s advances from the FHLB are collateralized by a blanket collateral agreement of qualifying mortgage and home equity line of credit loans and certain commercial real estate loans totaling approximately $2.11 billion and $2.22 billion at March 31, 2019 and December 31, 2018, respectively. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 3 Months Ended |
Mar. 31, 2019 | |
EARNINGS PER SHARE | |
EARNINGS PER SHARE | Note 13 – Earnings Per Share Earnings per share are calculated utilizing the two‑class method. Basic earnings per share are calculated by dividing the sum of distributed earnings to common shareholders and undistributed earnings allocated to common shareholders by the weighted average number of common shares outstanding. Diluted earnings per share are calculated by dividing the sum of distributed earnings to common shareholders and undistributed earnings allocated to common shareholders by the weighted average number of shares adjusted for the dilutive effect of common stock awards. The diluted earnings per share computation for the three months ended March 31, 2019 and 2018 excluded antidilutive stock options of 97,628 and 31,259, respectively, because the exercise prices of these stock options exceeded the average market prices of the Company’s common shares for those respective periods. Presented below are the calculations for basic and diluted earnings per common share for the three months ended March 31, 2019 and 2018: Three Months Ended March 31, (dollars in thousands, except per share data) 2019 2018 Net income $ 13,982 $ 1,806 Preferred dividends declared (82) (83) Preferred stock, premium amortization 48 47 Net income available to common shareholders 13,948 1,770 Common shareholder dividends (5,776) (4,208) Unvested restricted stock award dividends (47) (31) Undistributed earnings to unvested restricted stock awards (65) — Undistributed earnings to common shareholders $ 8,060 $ (2,469) Basic Distributed earnings to common shareholders $ 5,776 $ 4,208 Undistributed earnings to common shareholders 8,060 (2,469) Total common shareholders earnings, basic $ 13,836 $ 1,739 Diluted Distributed earnings to common shareholders $ 5,776 $ 4,208 Undistributed earnings to common shareholders 8,060 (2,469) Total common shareholders earnings 13,836 1,739 Add back: Undistributed earnings reallocated from unvested restricted stock awards — — Total common shareholders earnings, diluted $ 13,836 $ 1,739 Weighted average common shares outstanding, basic 23,998,119 20,901,738 Options and warrants 206,542 449,773 Weighted average common shares outstanding, diluted 24,204,661 21,351,511 Basic earnings per common share $ 0.58 $ 0.08 Diluted earnings per common share 0.57 0.08 |
FAIR VALUE OF FINANCIAL INSTRUM
FAIR VALUE OF FINANCIAL INSTRUMENTS | 3 Months Ended |
Mar. 31, 2019 | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | Note 14 – Fair Value of Financial Instruments Fair value is defined as the exchange price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date reflecting assumptions that a market participant would use when pricing an asset or liability. The hierarchy uses three levels of inputs to measure the fair value of assets and liabilities as follows: · Level 1: Unadjusted quoted prices for identical assets or liabilities traded in active markets. · Level 2: Significant other observable inputs other than Level 1, including quoted prices for similar assets and liabilities in active markets, quoted prices in less active markets, or other observable inputs that can be corroborated by observable market data. · Level 3: Significant unobservable inputs that reflect a company’s own assumptions about the assumptions that market participants would use in pricing an asset or liability. Assets and liabilities measured and recorded at fair value, including financial assets for which the Company has elected the fair value option, on a recurring and nonrecurring basis as of March 31, 2019 and December 31, 2018, are summarized below: March 31, 2019 Quoted prices in active Significant markets other Significant for identical observable unobservable assets inputs inputs (dollars in thousands) Total (Level 1) (Level 2) (Level 3) Assets and liabilities measured at fair value on a recurring basis: Assets Investment securities available for sale: U.S. Treasury securities $ 24,768 $ 24,768 $ — $ — Government sponsored entity debt securities 75,587 — 75,587 — Agency mortgage-backed securities 321,451 — 321,451 — State and municipal securities 150,912 — 150,912 — Corporate securities 80,021 — 78,091 1,930 Equity securities 3,413 — 3,413 — Loans held for sale 16,851 — 16,851 — Interest rate lock commitments 5,752 — 5,752 — Interest rate swap contracts 18 — 18 — Total $ 678,773 $ 24,768 $ 652,075 $ 1,930 Liabilities Interest rate swap contracts $ 18 $ — $ 18 $ — Assets measured at fair value on a non-recurring basis: Mortgage servicing rights $ 52,957 $ — $ — $ 52,957 Mortgage servicing rights held for sale 257 257 — — Impaired loans 6,734 — 4,639 2,095 Other real estate owned 47 — 47 — Assets held for sale 1,687 — 1,687 — December 31, 2018 Quoted prices in active Significant markets other Significant for identical observable unobservable assets inputs inputs (dollars in thousands) Total (Level 1) (Level 2) (Level 3) Assets and liabilities measured at fair value on a recurring basis: Assets Investment securities available for sale: U.S. Treasury securities $ 24,650 $ 24,650 $ — $ — Government sponsored entity debt securities 75,684 — 75,684 — Agency mortgage-backed securities 326,305 — 326,305 — State and municipal securities 159,262 — 159,262 — Corporate securities 71,550 — 69,627 1,923 Equity securities 3,334 — 3,334 — Loans held for sale 30,401 — 30,401 — Interest rate lock commitments 4,492 — 4,492 — Forward commitments to sell mortgage-backed securities — — — — Interest rate swap contracts 145 — 145 — Total $ 695,823 $ 24,650 $ 669,250 $ 1,923 Liabilities Interest rate swap contracts $ 145 $ — $ 145 $ — Assets measured at fair value on a non-recurring basis: Mortgage servicing rights $ 53,447 $ — $ — $ 53,447 Mortgage servicing rights held for sale 3,545 3,545 — — Impaired loans 11,238 — 9,226 2,012 Other real estate owned 1,439 — 1,439 — Assets held for sale 1,687 — 1,687 — The following table presents losses recognized on assets measured on a non‑recurring basis for the three months ended March 31, 2019 and 2018: Three Months Ended March 31, (dollars in thousands) 2019 2018 Mortgage servicing rights $ 25 $ 133 Impaired loans 981 875 Other real estate owned 16 — Total loss on assets measured on a nonrecurring basis $ 1,022 $ 1,008 The following table presents activity for assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three months ended March 31, 2019 and 2018: Corporate Securities Three Months Ended March 31, (dollars in thousands) 2019 2018 Balance, beginning of period $ 1,923 $ 4,779 Total realized in earnings (1) 22 187 Total unrealized in other comprehensive income 7 616 Net settlements (principal and interest) (22) (162) Balance, end of period $ 1,930 $ 5,420 (1) Amounts included in interest income from investment securities taxable in the consolidated statements of income. The following table presents quantitative information about significant unobservable inputs used in fair value measurements of non-recurring assets (Level 3) at March 31, 2019: Non-recurring Fair Value Valuation Unobservable fair value measurements (dollars in thousands technique input / assumptions Range (weighted average) Mortgage servicing rights $ 52,957 Discounted cash flow Prepayment speed 8.00% - 18.00% (8.21%) Discount rate 10.00% - 12.00% (11.12%) Impaired loans $ 2,095 Fair value of collateral Discount for type of property, 4.32% - 7.33% (5.49%) age of appraisal and current status The following table presents quantitative information about significant unobservable inputs used in fair value measurements of non-recurring assets (Level 3) at December 31, 2018: Non-recurring Fair Value Valuation Unobservable fair value measurements (dollars in thousands technique input / assumptions Range (weighted average) Mortgage servicing rights $ 53,447 Discounted cash flow Prepayment speed 8.00% - 18.00% (8.24%) Discount rate 10.00% - 27.00% (11.12%) Impaired loans $ 2,012 Fair value of collateral Discount for type of property, 5.00% - 7.26% (5.26%) age of appraisal and current status Mortgage Servicing Rights. In accordance with GAAP , the Company must record impairment charges on mortgage servicing rights on a non-recurring basis when the carrying value exceeds the estimated fair value. The fair value of our servicing rights is estimated by using a cash flow valuation model, which calculates the present value of estimated future net servicing cash flows, taking into consideration expected mortgage loan prepayment rates, discount rates, servicing costs, replacement reserves and other economic factors which are estimated based on current market conditions. The determination of fair value of servicing rights relies upon Level 3 inputs. The fair value of mortgage servicing rights was $53.0 million and $53.4 million at March 31, 2019 and December 31, 2018, respectively. Impaired loans. Impaired loans are measured and recorded at fair value on a non-recurring basis. All of our nonaccrual loans and restructured loans are considered impaired and are reviewed individually for the amount of impairment, if any. Most of our loans are collateral dependent and, accordingly, we measure impaired loans based on the estimated fair value of such collateral. The fair value of each loan’s collateral is generally based on estimated market prices from an independently prepared appraisal, which is then adjusted for the cost related to liquidating such collateral; such valuation inputs result in a nonrecurring fair value measurement that is categorized as a Level 2 measurement. When adjustments are made to an appraised value to reflect various factors such as the age of the appraisal or known changes in the market or the collateral, such valuation inputs are considered unobservable and the fair value measurement is categorized as a Level 3 measurement. The impaired loans categorized as Level 3 also include unsecured loans and other secured loans whose fair values are based significantly on unobservable inputs such as the strength of a guarantor, cash flows discounted at the effective loan rate, and management’s judgment. ASC Topic 825, Financial Instruments , requires disclosure of the estimated fair value of certain financial instruments and the methods and significant assumptions used to estimate such fair values. Additionally, certain financial instruments and all nonfinancial instruments are excluded from the applicable disclosure requirements. The Company has elected the fair value option for newly originated residential and commercial loans held for sale. These loans are intended for sale and are hedged with derivative instruments. We have elected the fair value option to mitigate accounting mismatches in cases where hedge accounting is complex and to achieve operational simplification. The following table presents the difference between the aggregate fair value and the aggregate remaining principal balance for loans for which the fair value option has been elected as of March 31, 2019 and December 31, 2018: March 31, 2019 December 31, 2018 Aggregate Contractual Aggregate Contractual (dollars in thousands) fair value Difference principal fair value Difference principal Residential loans held for sale $ 5,896 $ 322 $ 5,574 $ 8,121 $ 484 $ 7,637 Commercial loans held for sale 10,955 267 10,688 22,280 595 21,685 Total loans held for sale $ 16,851 $ 589 $ 16,262 $ 30,401 $ 1,079 $ 29,322 The following table presents the amount of gains and losses from fair value changes included in income before income taxes for financial assets carried at fair value for the three months ended March 31, 2019 and 2018: Three Months Ended March 31, (dollars in thousands) 2019 2018 Residential loans held for sale $ (57) $ (108) Commercial loans held for sale (328) (235) Total loans held for sale $ (385) $ (343) The following tables are a summary of the carrying values and fair value estimates of certain financial instruments as of March 31, 2019 and December 31, 2018: March 31, 2019 Quoted prices in active Significant markets other Significant for identical observable unobservable Carrying assets inputs inputs (dollars in thousands) Amount Fair Value (Level 1) (Level 2) (Level 3) Assets Cash and due from banks $ 275,939 $ 275,939 $ 275,939 $ — $ — Federal funds sold 541 541 541 — — Investment securities available for sale 652,739 652,739 24,768 626,041 1,930 Equity securities 3,413 3,413 — 3,413 — Nonmarketable equity securities 46,009 46,009 — 46,009 — Loans, net 4,069,015 4,061,017 — — 4,061,017 Loans held for sale 16,851 16,851 — 16,851 — Accrued interest receivable 5,070 5,070 — 5,070 — Interest rate lock commitments 5,752 5,752 — 5,752 — Interest rate swap contracts 18 18 — 18 — Liabilities Deposits $ 4,036,288 $ 4,034,453 $ — $ 4,034,453 $ — Short-term borrowings 115,832 115,832 — 115,832 — FHLB and other borrowings 669,009 674,353 — 674,353 — Subordinated debt 94,174 95,526 — 95,526 — Trust preferred debentures 47,918 56,018 — 56,018 — Accrued interest payable 6,254 6,254 — 6,254 — Interest rate swap contracts 18 18 — 18 — December 31, 2018 Quoted prices in active Significant markets other Significant for identical observable unobservable Carrying assets inputs inputs (dollars in thousands) Amount Fair Value (Level 1) (Level 2) (Level 3) Assets Cash and due from banks $ 210,780 $ 210,780 $ 210,780 $ — $ — Federal funds sold 2,920 2,920 2,920 — — Investment securities available for sale 660,785 660,785 24,650 634,212 1,923 Nonmarketable equity securities 42,472 42,472 — 42,472 — Loans, net 4,116,648 4,091,438 — — 4,091,438 Loans held for sale 30,401 30,401 — 30,401 — Accrued interest receivable 16,560 16,560 — 16,560 — Interest rate lock commitments 4,492 4,492 — 4,492 — Interest rate swap contracts 145 145 — 145 — Liabilities Deposits $ 4,074,170 $ 4,069,098 $ — $ 4,069,098 $ — Short-term borrowings 124,235 124,235 — 124,235 — FHLB and other borrowings 640,631 641,050 — 641,050 — Subordinated debt 94,134 91,926 — 91,926 — Trust preferred debentures 47,794 56,805 — 56,805 — Accrued interest payable 4,855 4,855 — 4,855 — Interest rate swap contracts 145 145 — 145 — |
COMMITMENTS, CONTINGENCIES AND
COMMITMENTS, CONTINGENCIES AND CREDIT RISK | 3 Months Ended |
Mar. 31, 2019 | |
COMMITMENTS, CONTINGENCIES AND CREDIT RISK | |
COMMITMENTS, CONTINGENCIES AND CREDIT RISK | Note 15 – Commitments, Contingencies and Credit Risk In the normal course of business, there are outstanding various contingent liabilities such as claims and legal actions, which are not reflected in the consolidated financial statements. No material losses are anticipated as a result of these actions or claims. We are a party to financial instruments with off-balance‑sheet risk in the normal course of business to meet the financing needs of our customers. These financial instruments include commitments to extend credit and standby letters of credit. Those instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the balance sheet. The contract amounts of those instruments reflect the extent of involvement we have in particular classes of financial instruments. Our exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to extend credit and standby letters of credit is represented by the contractual amount of those instruments. The Bank used the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments. The commitments are principally tied to variable rates. Loan commitments as of March 31, 2019 and December 31, 2018 were as follows: March 31, December 31, (dollars in thousands) 2019 2018 Commitments to extend credit $ 670,694 $ 663,555 Financial guarantees – standby letters of credit 140,183 142,859 The Company establishes a mortgage repurchase liability to reflect management’s estimate of losses on loans for which the Company could have a repurchase obligation based on the volume of loans sold in 2019 and years prior, borrower default expectations, historical investor repurchase demand and appeals success rates, and estimated loss severity. Loans repurchased from investors are initially recorded at fair value, which becomes the Company’s new accounting basis. Any difference between the loan’s fair value and the outstanding principal amount is charged or credited to the mortgage repurchase liability, as appropriate. Subsequent to repurchase, such loans are carried in loans receivable. As a result of make-whole requests and loan repurchases, the Company incurred losses totaling $20,000 for the three months ended March 31, 2018. There were no losses as a result of make-whole requests and loan repurchases for the three months ended March 31, 2019. The liability for unresolved repurchase demands totaled $289,000 and $492,000 at March 31, 2019 and December 31, 2018, respectively. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 3 Months Ended |
Mar. 31, 2019 | |
SEGMENT INFORMATION | |
SEGMENT INFORMATION | Note 16 – Segment Information Our business segments are defined as Banking, Commercial FHA Origination and Servicing, Wealth Management, and Other. The reportable business segments are consistent with the internal reporting and evaluation of the principle lines of business of the Company. The banking segment provides a wide range of financial products and services to consumers and businesses, including commercial, commercial real estate, mortgage and other consumer loan products; commercial equipment leasing; mortgage loan sales and servicing; letters of credit; various types of deposit products, including checking, savings and time deposit accounts; merchant services; and corporate treasury management services. The commercial FHA origination and servicing segment provides for the origination and servicing of government sponsored mortgages for multifamily and healthcare facilities. The wealth management segment consists of trust and fiduciary services, brokerage and retirement planning services. The other segment includes the operating results of the parent company, our captive insurance business unit, and the elimination of intercompany transactions. Selected business segment financial information as of and for the three months ended March 31, 2019 and 2018 were as follows: Commercial FHA Origination and Wealth (dollars in thousands) Banking Servicing Management Other Total Three Months Ended March 31, 2019 Net interest income (expense) $ 48,518 $ (176) $ — $ (2,741) $ 45,601 Provision for loan losses 3,243 — — — 3,243 Noninterest income 8,940 3,238 4,953 (56) 17,075 Noninterest expense 35,371 2,811 3,247 (332) 41,097 Income before income taxes 18,844 251 1,706 (2,465) 18,336 Income taxes (benefit) 4,975 71 140 (832) 4,354 Net income (loss) $ 13,869 $ 180 $ 1,566 $ (1,633) $ 13,982 Total assets $ 5,582,494 $ 94,797 $ 19,039 $ (54,550) $ 5,641,780 Three Months Ended March 31, 2018 Net interest income (expense) $ 40,631 $ 37 $ 85 $ (2,568) $ 38,185 Provision for loan losses 2,006 — — — 2,006 Noninterest income 9,016 3,521 4,080 (115) 16,502 Noninterest expense 44,366 3,538 2,386 (791) 49,499 Income (loss) before income taxes (benefit) 3,275 20 1,779 (1,892) 3,182 Income taxes (benefit) 1,379 407 141 (551) 1,376 Net income (loss) $ 1,896 $ (387) $ 1,638 $ (1,341) $ 1,806 Total assets $ 5,671,231 $ 91,580 $ 16,573 $ (56,012) $ 5,723,372 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2019 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | 1 Note 17 – Related Party Transactions The Company utilizes the services of a company to act as a general manager for the construction of new facilities. A member of our board of directors is a substantial shareholder of this company and currently serves as its Chairman. During the three months ended March 31, 2019, the Company paid $210,000 to this company for work on various projects, which was approved in accordance with the Company’s related party transaction policy. |
LEASES
LEASES | 3 Months Ended |
Mar. 31, 2019 | |
LEASES | |
LEASES | Note 18 – Leases The Company has operating leases for banking centers and operating facilities. Our leases have remaining lease terms of 2 months to 13 years, some of which may include options to extend the lease terms for up to an additional 5 years. The options to extend are not recognized as part of the ROU assets and lease liabilities. Information related to operating leases for the three months ended March 31, 2019 was as follows: Three Months Ended (dollars in thousands) March 31, 2019 Operating lease cost $ 708 Operating cash flows from leases 741 Right-of-use assets obtained in exchange for lease obligations 10,677 Weighted average remaining lease term 6 years Weighted average discount rate 3.12 % The projected minimum rental payments under the terms of the leases as of March 31, 2019 were as follows: (dollars in thousands) Amount Year ending December 31: 2019 remaining $ 2,482 2020 2,288 2021 2,160 2022 2,060 2023 1,292 Thereafter 2,057 Total future minimum lease payments 12,339 Less imputed interest (1,141) Total operating lease liabilities $ 11,198 |
REVENUE FROM CONTRACT WITH CUST
REVENUE FROM CONTRACT WITH CUSTOMERS | 3 Months Ended |
Mar. 31, 2019 | |
Revenue from contract with customers | |
Revenue from contract with customers | Note 19 – Revenue From Contracts with Customers On January 1, 2018, the Company adopted ASU No. 2014-09 “Revenue from Contracts with Customers” (Topic 606) and all subsequent ASUs that modified Topic 606. As stated in “ Note 2 – Basis of Presentation and Summary of Significant Accounting Policies ,” the implementation of the new standard did not have a material impact on the measurement or recognition of revenue. Since the impact of applying the standard was determined to be immaterial, the Company did not record a cumulative effect adjustment to beginning retained earnings on January 1, 2018. Results for reporting periods beginning after January 1, 2018 are presented under Topic 606, while prior period amounts were not adjusted and continue to be reported in accordance with previous GAAP. Topic 606 does not apply to revenue associated with financial instruments, including revenue from loans and investment securities. In addition, certain noninterest income streams such as commercial FHA revenue, residential mortgage banking revenue and gain on sales of investment securities, net are also not in scope of the new guidance. Topic 606 is applicable to noninterest income streams such as wealth management revenue, service charges on deposit accounts, interchange revenue, gain on sales of other real estate owned, and certain other noninterest income streams. The recognition of revenue associated with these noninterest income streams did not change significantly from current practice upon adoption of Topic 606. The noninterest income streams considered in-scope by Topic 606 are discussed below. Wealth Management Revenue Wealth management revenue is primarily comprised of fees earned from the management and administration of trusts and other customer assets. The Company also earns investment advisory fees through its SEC registered investment advisory subsidiary. The Company’s performance obligation in both of these instances is generally satisfied over time and the resulting fees are recognized monthly, based upon the month-end market value of the assets under management and contractually determined fee schedules. Payment is generally received a few days after month end through a direct charge to each customer’s account. The Company does not earn performance-based incentives. Optional services such as real estate sales and tax return preparation services are also available to existing trust and asset management customers. The Company’s performance obligation for these transactional-based services is generally satisfied, and related revenue recognized, at a point in time (i.e., as incurred). Payment is received shortly after services are rendered. Fees generated from transactions executed by the Company’s third party broker dealer are remitted by them to the Company on a monthly basis for that month’s transactional activity. Service Charges on Deposit Accounts Service charges on deposit accounts consist of fees received under depository agreements with customers to provide access to deposited funds, serve as custodian of deposited funds, and when applicable, pay interest on deposits. These service charges primarily include non-sufficient fund fees and other account related service charges. Non-sufficient fund fees are earned when a depositor presents an item for payment in excess of available funds, and the Company, at its discretion, provides the necessary funds to complete the transaction. The Company generates other account related service charge revenue by providing depositors proper safeguard and remittance of funds as well as by delivering optional services for depositors, such as check imaging or treasury management, that are performed upon the depositor’s request. The Company’s performance obligation for the proper safeguard and remittance of funds, monthly account analysis and any other monthly service fees is generally satisfied, and the related revenue recognized, over the period in which the service is provided. Payment for service charges on deposit accounts is typically received immediately or in the following month through a direct charge to a customer’s account. Interchange Revenue Interchange revenue includes debit / credit card income and ATM user fees. Card income is primarily comprised of interchange fees earned for standing ready to authorize and providing settlement on card transactions processed through the MasterCard interchange network. The levels and structure of interchange rates are set by MasterCard and can vary based on cardholder purchase volumes. Interchange fees from cardholder transactions represent a percentage of the underlying transaction value and are recognized daily, concurrently with completion of the Company’s performance obligation, the transaction processing services provided to the cardholder. Payment is typically received immediately or in the following month. ATM fees are primarily generated when a Company cardholder withdraws funds from a non-Company ATM or a non-Company cardholder withdraws funds from a Company ATM. The Company satisfies its performance obligation for each transaction at the point in time when the ATM withdrawal is processed. Gain on Sales of Other Real Estate Owned The Company records a gain or loss from the sale of other real estate owned (“OREO”) when control of the property transfers to the buyer, which generally occurs at the time of an executed deed. When the Company finances the sale of OREO to a buyer, the Company assesses whether the buyer is committed to perform their obligations under the contract and whether collectability of the transaction price is probable. Once these criteria are met, the OREO asset is derecognized and the gain or loss on sale is recorded upon transfer of control of the property to the buyer. In determining the gain or loss on the sale, the Company adjusts the transaction price and related gain or loss on sale if a significant financing component is present. Other Noninterest Income The other noninterest income revenue streams within the scope of Topic 606 consist of merchant services revenue, safe deposit box rentals, wire transfer fees, paper statement fees, check printing commissions, and other noninterest related fees. Revenue from the Company’s merchant services business consists principally of transaction and account management fees charged to merchants for the electronic processing of transactions. These fees are net of interchange fees paid to the credit card issuing bank, card company assessments, and revenue sharing amounts. Account management fees are considered earned at the time the merchant’s transactions are processed or other services are performed. Fees related to the other components of other noninterest income within the scope of Topic 606 are largely transactional based, and therefore, the Company’s performance obligation is satisfied and related revenue recognized, at the point in time the customer uses the selected service to execute a transaction. The following presents noninterest income, segregated by revenue streams in-scope and out-of-scope of Topic 606, for the three months ended March 31, 2019 and 2018. Three Months Ended March 31, (dollars in thousands) 2019 2018 Noninterest income - in-scope of Topic 606 Wealth management revenue: Trust management/administration fees $ 3,617 $ 3,119 Investment advisory fees 529 465 Investment brokerage fees 219 264 Other 588 231 Service charges on deposit accounts: Nonsufficient fund fees 1,754 1,450 Other 766 517 Interchange revenues 2,680 2,045 Other income: Merchant services revenue 375 338 Other 818 1,070 Noninterest income - out-of-scope of Topic 606 5,729 7,003 Total noninterest income $ 17,075 $ 16,502 Contract Balances A contract asset balance occurs when an entity performs a service for a customer before the customer pays consideration (resulting in a contract receivable) or before payment is due (resulting in a contract asset). A contract liability balance is an entity’s obligation to transfer a service to a customer for which the entity has already received payment (or payment is due) from the customer. The Company’s noninterest revenue streams are largely based on transactional activity, or standard month-end revenue accruals such as asset management fees based on month-end market values. Consideration is often received immediately or shortly after the Company satisfies its performance obligation and revenue is recognized. The Company does not typically enter into long-term revenue contracts with customers, and therefore, does not experience significant contract balances. As of March 31, 2019 and December 31, 2018, the Company did not have any significant contract balances. Contract Acquisition Costs In connection with the adoption of Topic 606, an entity is required to capitalize, and subsequently amortize into expense, certain incremental costs of obtaining a contract with a customer if these costs are expected to be recovered. The incremental costs of obtaining a contract are those costs that an entity incurs to obtain a contract with a customer that it would not have incurred if the contract had not been obtained (for example, sales commission). The Company utilizes the practical expedient which allows entities to immediately expense contract acquisition costs when the asset that would have resulted from capitalizing these costs would have been amortized in one year or less. Upon adoption of Topic 606, the Company did not capitalize any contract acquisition costs. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2019 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | Note 20 – Subsequent Events Pending Acquisition – HomeStar Financial Group, Inc. On April 2, 2019, the Company announced it had entered into a definitive agreement to acquire HomeStar Financial Group, Inc. (“HomeStar”), and its wholly owned subsidiary, HomeStar Bank and Financial Services (“HomeStar Bank”) for estimated total consideration of $9.9 million, consisting of 405,000 shares of the Company’s common stock, plus cash in an amount equal to the amount, if any, by which HomeStar’s adjusted shareholders’ equity prior to closing exceeds $10.4 million. HomeStar Bank is headquartered in Manteno, Illinois, and operates 5 full-service banking centers in northern Illinois. As of December 31, 2018, HomeStar Bank had total assets of $375.4 million, net loans of $222.7 million and total deposits of $333.1 million. Under the terms of the definitive agreement, prior to closing, HomeStar’s outstanding trust preferred securities and subordinated debentures plus accrued interest will be repurchased or paid off with approximately $23.5 million of cash provided by the Company, which amount represents a discount to the outstanding obligations on these securities. Additionally, prior to closing, HomeStar Bank will sell its interest in both its insurance agency and title company subsidiaries. The transaction is expected to close in the third quarter of 2019, subject to regulatory approval, the approval of HomeStar’s shareholders, the completion of the trust preferred securities transactions, and the satisfaction of customary closing conditions. |
BASIS OF PRESENTATION AND SUM_2
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation | Basis of Presentation The consolidated financial statements of the Company are unaudited and should be read in conjunction with the consolidated financial statements and related notes contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018, filed with the Securities and Exchange Commission (the “SEC”) on February 28, 2019. The consolidated financial statements have been prepared in accordance with the accounting principles generally accepted in the United States of America (“GAAP”) and conform to predominant practices within the banking industry. A discussion of these policies can be found in Note 1 – Summary of Significant Accounting Policies included i n the Company's 2018 Annual Report on Form 10-K. There has been one change to our significant accounting policies since December 31, 2018, which is described below. Management of the Company has made a number of estimates and assumptions related to the reporting of assets and liabilities to prepare the consolidated financial statements in conformity with GAAP. Actual results may differ from those estimates. In the opinion of management, all adjustments, consisting of normal recurring accruals considered necessary for a fair presentation of the results of operations for the interim periods presented herein, have been included. Certain reclassifications of 2018 amounts have been made to conform to the 2019 presentation. Management has evaluated subsequent events for potential recognition or disclosure. Operating results for the three months ended March 31, 2019 are not necessarily indicative of the results that may be expected for the year ending December 31, 2019 or any other period. |
Leases | Leases The Company determines if a lease is present at the inception of an agreement. Operating leases are capitalized at commencement and are discounted using the Company’s FHLB borrowing rate for a similar term borrowing unless the lease defines an implicit rate within the contract. For operating leases existing prior to January 1, 2019, the rate for the remaining lease term as of January 1, 2019 was used. The right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease ROU assets and operating lease liabilities are recognized on the lease commencement date based on the present value of lease payments over the lease term. No significant judgments or assumptions were involved in developing the estimated operating lease liabilities as the Company’s operating lease liabilities largely represent future rental expenses associated with operating leases and the borrowing rates are based on publicly available interest rates. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of the parent company and its subsidiaries. All significant intercompany accounts and transactions have been eliminated. Assets held for customers in a fiduciary or agency capacity, other than trust cash on deposit with the Bank, are not assets of the Company and, accordingly, are not included in the accompanying unaudited consolidated financial statements. |
Impact of Recently Issued Accounting Standards | Impact of Recently Issued Accounting Standards FASB ASU 2016-02, “Leases (Topic 842)” – In February 2016, the FASB issued ASU No. 2016-02, “ Leases (Topic 842) ,” which requires lessees to recognize leases on-balance sheet and to disclose key information about leasing arrangements. Topic 842 was subsequently amended by ASU No. 2018-10, “ Codification Improvements to Topic 842, Leases;” and ASU No. 2018-11, “Targeted Improvements.” The new standard established a ROU model, that requires a lessee to recognize ROU assets and lease liabilities on the balance sheet for all leases with a term longer than 12 months. Under the new guidance, leases are classified as either finance or operating, with classification affecting the pattern and classification of expense recognition in the statement of income. The Company adopted the new standard on January 1, 2019, and used the effective date as our date of initial application . A modified retrospective adoption approach is required, applying the new standard to all existing leases in effect at the adoption date and new leases going forward. Consequently, financial information will not be updated and the disclosures required under the new standard will not be provided for dates and periods prior to January 1, 2019. This update also allows lessors to not separate non-lease components from the associated lease component if certain conditions are met. The Company elected the “package of practical expedients” permitted by ASU 2018-11, which allows us not to reassess under the new standard our prior conclusions about lease identification, lease classification and initial direct costs. The new standard also provides practical expedients for ongoing accounting. The Company elected the short-term lease recognition exemption for our office equipment leases. This means, for those leases that qualify, we did recognize ROU assets or lease liabilities, and this includes not recognizing ROU assets or lease liabilities for existing short-term leases of those assets in transition. At the adoption date, the Company reported increased assets and liabilities of approximately $12.1 million on its consolidated balance sheet as a result of recognizing ROU assets and lease liabilities related to non-cancelable operating lease agreements for office space. T he adoption of this guidance did not have a material effect to its consolidated statement of income. FASB ASU 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” – In June 2016, the FASB issued ASU No. 2016-13, “ Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“CECL”).” The objective of this update is to improve financial reporting by providing timelier recording of credit losses on loans and other financial instruments held by financial institutions and other organizations. The ASU requires an organization to measure all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will use forward-looking information to better understand their credit loss estimates. For public companies that are filers with the SEC, this update is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. As previously disclosed, the Company has established a cross-functional governance structure, which oversees overall strategy for implementation of Topic 326. Additionally, a working group was formed and has developed a project plan focused on understanding the ASU, researching issues, data requirements, technology solutions and future state processes. The project plan is targeting the data and model validation completion during the second quarter of 2019, with parallel processing of our existing allowance for loan loss model with CECL prior to implementation. The working group has identified 12 distinct loan portfolios for which a model has been or is in the process of being developed. The Company is focused on completing data and model validation, refining assumptions and continued review of the models. The Company also continues to focus on researching and resolving interpretive accounting issues in the ASU, contemplating various related accounting policies, developing processes and related controls and considering various reporting disclosures. The Company also continues to believe that the adoption of the standard will result in an overall increase in the allowance for loan losses to cover credit losses over the estimated life of the financial assets. However, the magnitude of the increase in its allowance for loan losses at the adoption date will depend upon the nature and characteristics of the portfolio at the adoption date, as well as macroeconomic conditions and forecasts at that time. FASB ASU No. 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement” – In August 2018, the FASB issued ASU No. 2018-13 to improve the disclosure requirements on fair value measurements. The amendment removes certain disclosures required by Topic 820 related to transfers between Level 1 and Level 2 of the fair value hierarchy; the policy for timing of transfers between levels; the valuation processes for Level 3 fair value measurements. The update also adds certain disclosure requirements related to changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period and the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. For certain unobservable inputs, an entity may disclose other quantitative information in lieu of the weighted average if the entity determines that other quantitative information would be a more reasonable and rational method to reflect the distribution of unobservable inputs used to develop Level 3 fair value measurements. The amendments in this update become effective for fiscal years, and interim periods within those fiscal years beginning after December 15, 2019, with early adoption permitted. The Company is currently evaluating the impact of adopting the new guidance on its consolidated financial statements, but it is not expected to have a material impact. |
INVESTMENT SECURITIES (Tables)
INVESTMENT SECURITIES (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
INVESTMENT SECURITIES | |
Schedule of investment securities classified as available for sale | March 31, 2019 Gross Gross Amortized unrealized unrealized Fair (dollars in thousands) cost gains losses value Available for sale securities U.S. Treasury securities $ 25,009 $ — $ 241 $ 24,768 Government sponsored entity debt securities 75,620 133 166 75,587 Agency mortgage-backed securities 321,127 1,840 1,516 321,451 State and municipal securities 146,557 4,501 146 150,912 Corporate securities 79,626 863 468 80,021 Total available for sale securities $ 647,939 $ 7,337 $ 2,537 $ 652,739 Equity securities $ 3,413 December 31, 2018 Gross Gross Amortized unrealized unrealized Fair (dollars in thousands) cost gains losses value Available for sale securities U.S. Treasury securities $ 25,018 $ — $ 368 $ 24,650 Government sponsored entity debt securities 76,554 17 887 75,684 Agency mortgage-backed securities 329,690 371 3,756 326,305 State and municipal securities 156,795 3,282 815 159,262 Corporate securities 72,302 383 1,135 71,550 Total available for sale securities $ 660,359 $ 4,053 $ 6,961 $ 657,451 Equity securities $ 3,334 |
Schedule of unrealized losses and fair values for investment securities | March 31, 2019 Less than 12 Months 12 Months or more Total Fair Unrealized Fair Unrealized Fair Unrealized (dollars in thousands) value loss value loss value loss Available for sale securities U.S. Treasury securities $ 5,004 $ 1 $ 19,764 $ 240 $ 24,768 $ 241 Government sponsored entity debt securities 6,056 8 34,855 158 40,911 166 Agency mortgage-backed securities 13,390 26 124,358 1,490 137,748 1,516 State and municipal securities 5,429 2 16,839 144 22,268 146 Corporate securities 16,096 186 8,804 282 24,900 468 Total available for sale securities $ 45,975 $ 223 $ 204,620 $ 2,314 $ 250,595 $ 2,537 December 31, 2018 Less than 12 Months 12 Months or more Total Fair Unrealized Fair Unrealized Fair Unrealized (dollars in thousands) value loss value loss value loss Available for sale securities U.S. Treasury securities $ 5,012 $ 1 $ 19,638 $ 367 $ 24,650 $ 368 Government sponsored entity debt securities 51,717 195 23,223 692 74,940 887 Agency mortgage-backed securities 139,115 528 126,561 3,228 265,676 3,756 State and municipal securities 15,791 146 27,692 669 43,483 815 Corporate securities 32,616 575 8,535 560 41,151 1,135 Total available for sale securities $ 244,251 $ 1,445 $ 205,649 $ 5,516 $ 449,900 $ 6,961 |
Contractual maturity of amortized cost and fair value | Amortized Fair (dollars in thousands) cost value Available for sale securities Within one year $ 45,564 $ 45,610 After one year through five years 110,602 111,624 After five years through ten years 142,380 145,013 After ten years 28,266 29,041 Mortgage-backed securities 321,127 321,451 Total available for sale securities $ 647,939 $ 652,739 |
LOANS (Tables)
LOANS (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
LOANS | |
Summary of loans | March 31, 2019 December 31, 2018 Non-PCI PCI Non-PCI PCI (dollars in thousands) Loans Loans (1) Total Loans Loans (1) Total Commercial $ 839,731 $ 3,358 $ 843,089 $ 806,027 $ 4,857 $ 810,884 Commercial real estate 1,542,997 17,430 1,560,427 1,619,903 19,252 1,639,155 Construction and land development 233,332 6,044 239,376 223,898 8,331 232,229 Total commercial loans 2,616,060 26,832 2,642,892 2,649,828 32,440 2,682,268 Residential real estate 560,427 8,624 569,051 569,289 8,759 578,048 Consumer 599,151 1,480 600,631 611,408 1,776 613,184 Lease financing 279,532 — 279,532 264,051 — 264,051 Total loans $ 4,055,170 $ 36,936 $ 4,092,106 $ 4,094,576 $ 42,975 $ 4,137,551 (1) The unpaid principal balance for PCI loans totaled $50.5 million and $56.9 million as of March 31, 2019 and December 31, 2018, respectively. |
Summary of recorded investment (excluding PCI loans) by risk category | The following table presents the recorded investment of the commercial loan portfolio (excluding PCI loans) by risk category as of March 31, 2019 and December 31, 2018: March 31, 2019 December 31, 2018 Commercial Construction Commercial Construction Real and Land Real and Land (dollars in thousands) Commercial Estate Development Total Commercial Estate Development Total Acceptable credit quality $ 788,619 $ 1,449,480 $ 227,953 $ 2,466,052 $ 748,296 $ 1,536,127 $ 218,798 $ 2,503,221 Special mention 21,121 14,627 2,522 38,270 35,103 15,306 3,448 53,857 Substandard 21,498 51,574 890 73,962 14,139 46,976 — 61,115 Substandard – nonaccrual 8,493 27,316 1,168 36,977 8,489 21,494 1,171 31,154 Doubtful — — — — — — — — Not graded — — 799 799 — — 481 481 Total (excluding PCI) $ 839,731 $ 1,542,997 $ 233,332 $ 2,616,060 $ 806,027 $ 1,619,903 $ 223,898 $ 2,649,828 The Company evaluates the credit quality of its other loan portfolio based primarily on the aging status of the loan and payment activity. Accordingly, loans on nonaccrual status, loans past due 90 days or more and still accruing interest, and loans modified under troubled debt restructurings are considered to be impaired for purposes of credit quality evaluation. The following table presents the recorded investment of our other loan portfolio (excluding PCI loans) based on the credit risk profile of loans that are performing and loans that are impaired as of March 31, 2019 and December 31, 2018: March 31, 2019 December 31, 2018 Residential Lease Residential Lease (dollars in thousands) Real Estate Consumer Financing Total Real Estate Consumer Financing Total Performing $ 552,674 $ 598,618 $ 278,284 $ 1,429,576 $ 562,019 $ 610,839 $ 263,094 $ 1,435,952 Impaired 7,753 533 1,248 9,534 7,270 569 957 8,796 Total (excluding PCI) $ 560,427 $ 599,151 $ 279,532 $ 1,439,110 $ 569,289 $ 611,408 $ 264,051 $ 1,444,748 |
Summary of impaired loans (excluding PCI loans) | March 31, 2019 December 31, 2018 Unpaid Related Unpaid Related Recorded Principal Valuation Recorded Principal Valuation (dollars in thousands) Investment Balance Allowance Investment Balance Allowance Impaired loans with a valuation allowance: Commercial $ 8,191 $ 8,356 $ 4,730 $ 7,945 $ 8,102 $ 4,448 Commercial real estate 5,592 6,221 2,437 7,496 13,844 523 Construction and land development 125 169 14 171 171 54 Residential real estate 4,457 5,203 512 4,055 4,662 554 Consumer 522 547 41 428 444 45 Lease financing 436 436 146 766 766 361 Total impaired loans with a valuation allowance 19,323 20,932 7,880 20,861 27,989 5,985 Impaired loans with no related valuation allowance: Commercial 708 4,124 — 983 4,392 — Commercial real estate 24,019 30,492 — 16,372 16,921 — Construction and land development 1,093 1,093 — 1,136 1,136 — Residential real estate 3,296 3,557 — 3,215 3,516 — Consumer 11 13 — 141 145 — Lease financing 812 813 — 191 191 — Total impaired loans with no related valuation allowance 29,939 40,092 — 22,038 26,301 — Total impaired loans: Commercial 8,899 12,480 4,730 8,928 12,494 4,448 Commercial real estate 29,611 36,713 2,437 23,868 30,765 523 Construction and land development 1,218 1,262 14 1,307 1,307 54 Residential real estate 7,753 8,760 512 7,270 8,178 554 Consumer 533 560 41 569 589 45 Lease financing 1,248 1,249 146 957 957 361 Total impaired loans (excluding PCI) $ 49,262 $ 61,024 $ 7,880 $ 42,899 $ 54,290 $ 5,985 The difference between a loan’s recorded investment and the unpaid principal balance represents: (1) a partial charge-off resulting from a confirmed loss due to the value of the collateral securing the loan being below the loan’s principal balance and management’s assessment that the full collection of the loan balance is not likely and/or (2) payments received on nonaccrual loans that are fully applied to principal on the loan’s recorded investment as compared to being applied to principal and interest on the unpaid customer principal and interest balance. The difference between the recorded investment and the unpaid principal balance on loans was $11.8 million and $11.4 million at March 31, 2019 and December 31, 2018, respectively. The average balance of impaired loans (excluding PCI loans) and interest income recognized on impaired loans during the three months ended March 31, 2019 and 2018 are included in the table below: Three Months Ended March 31, 2019 2018 Interest Income Interest Income Average Recognized Average Recognized Recorded While on Recorded While on (dollars in thousands) Investment Impaired Status Investment Impaired Status Impaired loans with a valuation allowance: Commercial $ 8,240 $ 6 $ 2,291 $ 10 Commercial real estate 5,563 27 2,104 20 Construction and land development 141 — 101 1 Residential real estate 4,465 10 3,579 10 Consumer 527 — 208 — Lease financing 436 — 1,014 — Total impaired loans with a valuation allowance 19,372 43 9,297 41 Impaired loans with no related valuation allowance: Commercial 723 — 518 — Commercial real estate 24,153 — 13,731 — Construction and land development 1,110 1 739 — Residential real estate 3,306 2 2,370 1 Consumer 12 — 42 — Lease financing 813 — 247 — Total impaired loans with no related valuation allowance 30,117 3 17,647 1 Total impaired loans: Commercial 8,963 6 2,809 10 Commercial real estate 29,716 27 15,835 20 Construction and land development 1,251 1 840 1 Residential real estate 7,771 12 5,949 11 Consumer 539 — 250 — Lease financing 1,249 — 1,261 — Total impaired loans (excluding PCI) $ 49,489 $ 46 $ 26,944 $ 42 |
Summary of aging status of recorded investments in loans by portfolio (excluding PCI loans) | The aging status of the recorded investment in loans by portfolio (excluding PCI loans) as of March 31, 2019 and December 31, 2018 were as follows: Accruing 30-59 60-89 Past Due Days Days 90 Days Total Total (dollars in thousands) Past Due Past Due or More Nonaccrual Past Due Current Loans March 31, 2019 Commercial $ 2,323 $ 2,147 $ — $ 8,493 $ 12,963 $ 826,768 $ 839,731 Commercial real estate 4,862 1,160 — 27,316 33,338 1,509,659 1,542,997 Construction and land development 1,020 160 — 1,168 2,348 230,984 233,332 Residential real estate 1,305 716 — 6,884 8,905 551,522 560,427 Consumer 4,735 3,365 — 431 8,531 590,620 599,151 Lease financing 1,829 377 255 993 3,454 276,078 279,532 Total (excluding PCI) $ 16,074 $ 7,925 $ 255 $ 45,285 $ 69,539 $ 3,985,631 $ 4,055,170 December 31, 2018 Commercial $ 4,013 $ 2,581 $ 4 $ 8,489 $ 15,087 $ 790,940 $ 806,027 Commercial real estate 1,667 945 149 21,494 24,255 1,595,648 1,619,903 Construction and land development 989 — 85 1,171 2,245 221,653 223,898 Residential real estate 1,292 728 566 5,894 8,480 560,809 569,289 Consumer 5,211 2,533 51 388 8,183 603,225 611,408 Lease financing 4,322 932 206 751 6,211 257,840 264,051 Total (excluding PCI) $ 17,494 $ 7,719 $ 1,061 $ 38,187 $ 64,461 $ 4,030,115 $ 4,094,576 |
Summary of TDRs loans | The following table presents TDRs by loan portfolio (excluding PCI loans) as of March 31, 2019 and December 31, 2018: March 31, 2019 December 31, 2018 (dollars in thousands) Accruing (1) Non-accrual (2) Total Accruing (1) Non-accrual (2) Total Commercial $ 406 $ 399 $ 805 $ 435 $ 406 $ 841 Commercial real estate 2,295 10,713 13,008 2,225 9,103 11,328 Construction and land development 50 17 67 51 — 51 Residential real estate 869 1,398 2,267 810 853 1,663 Consumer 102 — 102 130 — 130 Lease financing — — — — — — Total loans (excluding PCI) $ 3,722 $ 12,527 $ 16,249 $ 3,651 $ 10,362 $ 14,013 (1) These loans are still accruing interest. (2) These loans are included in non-accrual loans in the preceding tables. The following table presents a summary of loans by portfolio that were restructured during the three months ended March 31, 2019 and the loans by portfolio that were modified as TDRs within the previous twelve months that subsequently defaulted during the three months ended March 31, 2019: Commercial Loan Portfolio Other Loan Portfolio Commercial Construction Residential Real and Land Real Lease (dollars in thousands) Commercial Estate Development Estate Consumer Financing Total For the three months ended March 31, 2019 Troubled debt restructurings: Number of loans — 3 1 7 1 — 12 Pre-modification outstanding balance $ — $ 1,924 $ 62 $ 224 $ 15 $ — $ 2,225 Post-modification outstanding balance — 1,838 17 222 15 — 2,092 Troubled debt restructurings that subsequently defaulted Number of loans — — 1 — — — 1 Recorded balance $ — $ — $ 43 $ — $ — $ — $ 43 |
Summary of changes in accretable yield for PCI loans | Three Months Ended March 31, (dollars in thousands) 2019 2018 Balance, at beginning of period $ 12,240 $ 5,732 New loans purchased – Alpine acquisition — 842 Accretion (1,076) (1,161) Other adjustments (including maturities, charge-offs and impact of changes in timing of expected cash flows) (106) 660 Reclassification from non-accretable 5 1,154 Balance, at end of period $ 11,063 $ 7,227 |
Summary of changes in allowance for loan losses, by loan portfolio | The following table represents, by loan portfolio, a summary of changes in the allowance for loan losses for the three months ended March 31, 2019 and 2018: Commercial Loan Portfolio Other Loan Portfolio Commercial Construction Residential Real and Land Real Lease (dollars in thousands) Commercial Estate Development Estate Consumer Financing Total Changes in allowance for loan losses for the three months ended March 31, 2019: Balance, beginning of period $ 9,524 $ 4,723 $ 372 $ 2,041 $ 2,154 $ 2,089 $ 20,903 Provision for loan losses 118 1,945 63 514 329 274 3,243 Charge-offs (112) (58) (44) (153) (556) (459) (1,382) Recoveries 15 7 7 22 210 66 327 Balance, end of period $ 9,545 $ 6,617 $ 398 $ 2,424 $ 2,137 $ 1,970 $ 23,091 Changes in allowance for loan losses for the three months ended March 31, 2018: Balance, beginning of period $ 5,256 $ 5,044 $ 518 $ 2,750 $ 1,344 $ 1,519 $ 16,431 Provision for loan losses 567 507 (215) (261) 304 1,104 2,006 Charge-offs (25) (160) — (36) (434) (486) (1,141) Recoveries 104 94 25 51 95 39 408 Balance, end of period $ 5,902 $ 5,485 $ 328 $ 2,504 $ 1,309 $ 2,176 $ 17,704 The following table represents, by loan portfolio, details regarding the balance in the allowance for loan losses and the recorded investment in loans as of March 31, 2019 and December 31, 2018 by impairment evaluation method: Commercial Loan Portfolio Other Loan Portfolio Commercial Construction Residential Real and Land Real Lease (dollars in thousands) Commercial Estate Development Estate Consumer Financing Total March 31, 2019: Allowance for loan losses: Loans individually evaluated for impairment $ 4,671 $ 2,391 $ — $ 177 $ — $ 114 $ 7,353 Loans collectively evaluated for impairment 59 46 14 335 41 32 527 Non-impaired loans collectively evaluated for impairment 4,797 3,375 384 1,481 1,898 1,824 13,759 Loans acquired with deteriorated credit quality (1) 18 805 — 431 198 — 1,452 Total allowance for loan losses $ 9,545 $ 6,617 $ 398 $ 2,424 $ 2,137 $ 1,970 $ 23,091 Recorded investment (loan balance): Impaired loans individually evaluated for impairment $ 8,354 $ 29,186 $ 1,093 $ 4,408 $ — $ 957 $ 43,998 Impaired loans collectively evaluated for impairment 545 425 125 3,345 533 291 5,264 Non-impaired loans collectively evaluated for impairment 830,832 1,513,386 232,114 552,674 598,618 278,284 4,005,908 Loans acquired with deteriorated credit quality (1) 3,358 17,430 6,044 8,624 1,480 — 36,936 Total recorded investment (loan balance) $ 843,089 $ 1,560,427 $ 239,376 $ 569,051 $ 600,631 $ 279,532 $ 4,092,106 December 31, 2018: Allowance for loan losses: Loans individually evaluated for impairment $ 4,405 $ 476 $ 48 $ 233 $ — $ 330 $ 5,492 Loans collectively evaluated for impairment 43 47 6 321 45 31 493 Non-impaired loans collectively evaluated for impairment 4,971 3,356 318 1,051 1,926 1,728 13,350 Loans acquired with deteriorated credit quality (1) 105 844 — 436 183 — 1,568 Total allowance for loan losses $ 9,524 $ 4,723 $ 372 $ 2,041 $ 2,154 $ 2,089 $ 20,903 Recorded investment (loan balance): Impaired loans individually evaluated for impairment $ 8,520 $ 23,431 $ 1,249 $ 3,929 $ 5 $ 668 $ 37,802 Impaired loans collectively evaluated for impairment 408 437 58 3,341 564 289 5,097 Non-impaired loans collectively evaluated for impairment 797,099 1,596,035 222,591 562,019 610,839 263,094 4,051,677 Loans acquired with deteriorated credit quality (1) 4,857 19,252 8,331 8,759 1,776 — 42,975 Total recorded investment (loan balance) $ 810,884 $ 1,639,155 $ 232,229 $ 578,048 $ 613,184 $ 264,051 $ 4,137,551 (1) Loans acquired with deteriorated credit quality were originally recorded at fair value at the acquisition date and the risk of credit loss was recognized at that date based on estimates of expected cash flows |
PREMISES AND EQUIPMENT, NET (Ta
PREMISES AND EQUIPMENT, NET (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
PREMISES AND EQUIPMENT | |
Summary of premises and equipment | March 31, December 31, (dollars in thousands) 2019 2018 Land $ 20,231 $ 20,231 Buildings and improvements 77,290 76,141 Furniture and equipment 29,873 29,858 Total 127,394 126,230 Accumulated depreciation (32,880) (31,390) Premises and equipment, net $ 94,514 $ 94,840 |
MORTGAGE SERVICING RIGHTS (Tabl
MORTGAGE SERVICING RIGHTS (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
MORTGAGE SERVICING RIGHTS | |
Schedule of other mortgage notes serviced and changes in our mortgage servicing rights | Changes in our commercial FHA mortgage servicing rights were as follows for the three months ended March 31, 2019 and 2018: Three Months Ended March 31, (dollars in thousands) 2019 2018 Mortgage servicing rights: Balance, beginning of period $ 56,252 $ 55,714 Originated servicing 213 1,001 Amortization (678) (676) Balance, end of period 55,787 56,039 Valuation allowances: Balance, beginning of period 2,805 3,254 Additions 25 133 Reductions — — Balance, end of period 2,830 3,387 Mortgage servicing rights, net $ 52,957 $ 52,652 Fair value: At beginning of period $ 53,447 $ 52,460 At end of period $ 52,957 $ 52,652 |
Schedule of summary of key assumptions | Remaining Servicing Interest Years to Prepayment Servicing Discount (dollars in thousands) Fee Rate Maturity Rate Cost Rate March 31, 2019: Commercial FHA mortgage loans 0.13 % 3.67 % 30.0 8.21 % $ 1,000 10 - 14 % December 31, 2018: Commercial FHA mortgage loans 0.13 % 3.67 % 30.1 8.24 % $ 1,000 10 - 14 % |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
GOODWILL AND INTANGIBLE ASSETS | |
Schedule of intangible assets | (dollars in thousands) Goodwill Banking $ 149,035 Commercial FHA origination and servicing 10,892 Wealth management 4,746 Total goodwill $ 164,673 The Company’s intangible assets, consisting of core deposit and customer relationship intangibles, as of March 31, 2019 and December 31, 2018 are summarized as follows: March 31, 2019 December 31, 2018 Gross Gross Carrying Accumulated Carrying Accumulated (dollars in thousands) Amount Amortization Total Amount Amortization Total Core deposit intangibles $ 52,712 $ (26,309) $ 26,403 $ 52,712 $ (24,803) $ 27,909 Customer relationship intangibles 13,771 (4,608) 9,163 13,771 (4,304) 9,467 Total intangible assets $ 66,483 $ (30,917) $ 35,566 $ 66,483 $ (29,107) $ 37,376 |
DERIVATIVE INSTRUMENTS (Tables)
DERIVATIVE INSTRUMENTS (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
DERIVATIVE INSTRUMENTS | |
Schedule of derivative instruments, fair value and notional amounts | Notional Amount Fair Value Gain March 31, December 31, March 31, December 31, (dollars in thousands) 2019 2018 2019 2018 Derivative Instruments (included in Other Assets): Interest rate lock commitments $ 275,324 $ 264,710 $ 5,752 $ 4,492 Forward commitments to sell mortgage-backed securities 274,234 276,871 — — Total $ 549,558 $ 541,581 $ 5,752 $ 4,492 Notional Amount Fair Value Loss March 31, December 31, March 31, December 31, (dollars in thousands) 2019 2018 2019 2018 Derivative Instruments (included in Other Liabilities): Forward commitments to sell mortgage-backed securities $ 67 $ 54 $ — $ — |
DEPOSITS (Tables)
DEPOSITS (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
DEPOSITS | |
Schedule summarizes the classification of deposits | March 31, December 31, (dollars in thousands) 2019 2018 Noninterest-bearing demand $ 941,344 $ 972,164 Interest-bearing: Checking 968,844 1,002,275 Money market 802,036 862,171 Savings 457,176 442,132 Time 866,888 795,428 Total deposits $ 4,036,288 $ 4,074,170 |
SHORT-TERM BORROWINGS (Tables)
SHORT-TERM BORROWINGS (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
SHORT-TERM BORROWINGS | |
Schedule of short term borrowings | Repurchase Agreements March 31, December 31, (dollars in thousands) 2019 2018 Outstanding at period-end $ 115,832 $ 124,235 Average amount outstanding 135,337 138,135 Maximum amount outstanding at any month end 138,907 173,387 Weighted average interest rate: During period 0.71 % 0.51 % End of period 0.73 % 0.71 % |
FHLB ADVANCES AND OTHER BORRO_2
FHLB ADVANCES AND OTHER BORROWINGS (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
FHLB ADVANCES AND OTHER BORROWINGS | |
Schedule of Federal Home Loan Bank (FHLB) advances | March 31, December 31, (dollars in thousands) 2019 2018 Midland States Bancorp, Inc. Term loan - variable interest rate equal to LIBOR plus 2.25%, which was 4.75% and 4.63% at March 31, 2019 and December 31, 2018, respectively, – maturing May 25, 2020 $ $ 32,840 Series G redeemable preferred stock - 181 shares at $1,000 per share Midland States Bank FHLB advances – fixed rate, fixed term of $62.5 million and $87.7 million, at rates averaging 2.50% and 2.35% at March 31, 2019 and December 31, 2018, respectively – maturing through February 2023 and putable fixed rate of $565.0 million and $520.0 million at rates averaging 2.11% and 2.09% at March 31, 2019 and December 31, 2018, respectively – maturing through August 2025 with call provisions through August 2021 627,414 607,610 FHLB advances – variable rate, fixed term, at a rate averaging 2.60% at March 31, 2019 – maturing in June 2019 10,000 — Total FHLB advances and other borrowings $ 669,009 $ 640,631 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
EARNINGS PER SHARE | |
Schedule of basic and diluted earnings per common share | Three Months Ended March 31, (dollars in thousands, except per share data) 2019 2018 Net income $ 13,982 $ 1,806 Preferred dividends declared (82) (83) Preferred stock, premium amortization 48 47 Net income available to common shareholders 13,948 1,770 Common shareholder dividends (5,776) (4,208) Unvested restricted stock award dividends (47) (31) Undistributed earnings to unvested restricted stock awards (65) — Undistributed earnings to common shareholders $ 8,060 $ (2,469) Basic Distributed earnings to common shareholders $ 5,776 $ 4,208 Undistributed earnings to common shareholders 8,060 (2,469) Total common shareholders earnings, basic $ 13,836 $ 1,739 Diluted Distributed earnings to common shareholders $ 5,776 $ 4,208 Undistributed earnings to common shareholders 8,060 (2,469) Total common shareholders earnings 13,836 1,739 Add back: Undistributed earnings reallocated from unvested restricted stock awards — — Total common shareholders earnings, diluted $ 13,836 $ 1,739 Weighted average common shares outstanding, basic 23,998,119 20,901,738 Options and warrants 206,542 449,773 Weighted average common shares outstanding, diluted 24,204,661 21,351,511 Basic earnings per common share $ 0.58 $ 0.08 Diluted earnings per common share 0.57 0.08 |
FAIR VALUE OF FINANCIAL INSTR_2
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Schedule of assets and liabilities measured and recorded at fair value | March 31, 2019 Quoted prices in active Significant markets other Significant for identical observable unobservable assets inputs inputs (dollars in thousands) Total (Level 1) (Level 2) (Level 3) Assets and liabilities measured at fair value on a recurring basis: Assets Investment securities available for sale: U.S. Treasury securities $ 24,768 $ 24,768 $ — $ — Government sponsored entity debt securities 75,587 — 75,587 — Agency mortgage-backed securities 321,451 — 321,451 — State and municipal securities 150,912 — 150,912 — Corporate securities 80,021 — 78,091 1,930 Equity securities 3,413 — 3,413 — Loans held for sale 16,851 — 16,851 — Interest rate lock commitments 5,752 — 5,752 — Interest rate swap contracts 18 — 18 — Total $ 678,773 $ 24,768 $ 652,075 $ 1,930 Liabilities Interest rate swap contracts $ 18 $ — $ 18 $ — Assets measured at fair value on a non-recurring basis: Mortgage servicing rights $ 52,957 $ — $ — $ 52,957 Mortgage servicing rights held for sale 257 257 — — Impaired loans 6,734 — 4,639 2,095 Other real estate owned 47 — 47 — Assets held for sale 1,687 — 1,687 — December 31, 2018 Quoted prices in active Significant markets other Significant for identical observable unobservable assets inputs inputs (dollars in thousands) Total (Level 1) (Level 2) (Level 3) Assets and liabilities measured at fair value on a recurring basis: Assets Investment securities available for sale: U.S. Treasury securities $ 24,650 $ 24,650 $ — $ — Government sponsored entity debt securities 75,684 — 75,684 — Agency mortgage-backed securities 326,305 — 326,305 — State and municipal securities 159,262 — 159,262 — Corporate securities 71,550 — 69,627 1,923 Equity securities 3,334 — 3,334 — Loans held for sale 30,401 — 30,401 — Interest rate lock commitments 4,492 — 4,492 — Forward commitments to sell mortgage-backed securities — — — — Interest rate swap contracts 145 — 145 — Total $ 695,823 $ 24,650 $ 669,250 $ 1,923 Liabilities Interest rate swap contracts $ 145 $ — $ 145 $ — Assets measured at fair value on a non-recurring basis: Mortgage servicing rights $ 53,447 $ — $ — $ 53,447 Mortgage servicing rights held for sale 3,545 3,545 — — Impaired loans 11,238 — 9,226 2,012 Other real estate owned 1,439 — 1,439 — Assets held for sale 1,687 — 1,687 — |
Schedule of losses recognized on assets measured on a non-recurring basis | Three Months Ended March 31, (dollars in thousands) 2019 2018 Mortgage servicing rights $ 25 $ 133 Impaired loans 981 875 Other real estate owned 16 — Total loss on assets measured on a nonrecurring basis $ 1,022 $ 1,008 |
Schedule presenting activity for assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) | The following table presents activity for assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three months ended March 31, 2019 and 2018: Corporate Securities Three Months Ended March 31, (dollars in thousands) 2019 2018 Balance, beginning of period $ 1,923 $ 4,779 Total realized in earnings (1) 22 187 Total unrealized in other comprehensive income 7 616 Net settlements (principal and interest) (22) (162) Balance, end of period $ 1,930 $ 5,420 (1) Amounts included in interest income from investment securities taxable in the consolidated statements of income. |
Schedule presents quantitative information about significant unobservable inputs used in fair value measurements of non-recurring assets (Level 3) | The following table presents quantitative information about significant unobservable inputs used in fair value measurements of non-recurring assets (Level 3) at March 31, 2019: Non-recurring Fair Value Valuation Unobservable fair value measurements (dollars in thousands technique input / assumptions Range (weighted average) Mortgage servicing rights $ 52,957 Discounted cash flow Prepayment speed 8.00% - 18.00% (8.21%) Discount rate 10.00% - 12.00% (11.12%) Impaired loans $ 2,095 Fair value of collateral Discount for type of property, 4.32% - 7.33% (5.49%) age of appraisal and current status The following table presents quantitative information about significant unobservable inputs used in fair value measurements of non-recurring assets (Level 3) at December 31, 2018: Non-recurring Fair Value Valuation Unobservable fair value measurements (dollars in thousands technique input / assumptions Range (weighted average) Mortgage servicing rights $ 53,447 Discounted cash flow Prepayment speed 8.00% - 18.00% (8.24%) Discount rate 10.00% - 27.00% (11.12%) Impaired loans $ 2,012 Fair value of collateral Discount for type of property, 5.00% - 7.26% (5.26%) age of appraisal and current status |
Schedule of the fair value option for newly originated residential and commercial loans held for sale | The following table presents the difference between the aggregate fair value and the aggregate remaining principal balance for loans for which the fair value option has been elected as of March 31, 2019 and December 31, 2018: March 31, 2019 December 31, 2018 Aggregate Contractual Aggregate Contractual (dollars in thousands) fair value Difference principal fair value Difference principal Residential loans held for sale $ 5,896 $ 322 $ 5,574 $ 8,121 $ 484 $ 7,637 Commercial loans held for sale 10,955 267 10,688 22,280 595 21,685 Total loans held for sale $ 16,851 $ 589 $ 16,262 $ 30,401 $ 1,079 $ 29,322 The following table presents the amount of gains and losses from fair value changes included in income before income taxes for financial assets carried at fair value for the three months ended March 31, 2019 and 2018: Three Months Ended March 31, (dollars in thousands) 2019 2018 Residential loans held for sale $ (57) $ (108) Commercial loans held for sale (328) (235) Total loans held for sale $ (385) $ (343) |
Schedule presentation of summary of the carrying values and fair value estimates of certain financial instruments | March 31, 2019 Quoted prices in active Significant markets other Significant for identical observable unobservable Carrying assets inputs inputs (dollars in thousands) Amount Fair Value (Level 1) (Level 2) (Level 3) Assets Cash and due from banks $ 275,939 $ 275,939 $ 275,939 $ — $ — Federal funds sold 541 541 541 — — Investment securities available for sale 652,739 652,739 24,768 626,041 1,930 Equity securities 3,413 3,413 — 3,413 — Nonmarketable equity securities 46,009 46,009 — 46,009 — Loans, net 4,069,015 4,061,017 — — 4,061,017 Loans held for sale 16,851 16,851 — 16,851 — Accrued interest receivable 5,070 5,070 — 5,070 — Interest rate lock commitments 5,752 5,752 — 5,752 — Interest rate swap contracts 18 18 — 18 — Liabilities Deposits $ 4,036,288 $ 4,034,453 $ — $ 4,034,453 $ — Short-term borrowings 115,832 115,832 — 115,832 — FHLB and other borrowings 669,009 674,353 — 674,353 — Subordinated debt 94,174 95,526 — 95,526 — Trust preferred debentures 47,918 56,018 — 56,018 — Accrued interest payable 6,254 6,254 — 6,254 — Interest rate swap contracts 18 18 — 18 — December 31, 2018 Quoted prices in active Significant markets other Significant for identical observable unobservable Carrying assets inputs inputs (dollars in thousands) Amount Fair Value (Level 1) (Level 2) (Level 3) Assets Cash and due from banks $ 210,780 $ 210,780 $ 210,780 $ — $ — Federal funds sold 2,920 2,920 2,920 — — Investment securities available for sale 660,785 660,785 24,650 634,212 1,923 Nonmarketable equity securities 42,472 42,472 — 42,472 — Loans, net 4,116,648 4,091,438 — — 4,091,438 Loans held for sale 30,401 30,401 — 30,401 — Accrued interest receivable 16,560 16,560 — 16,560 — Interest rate lock commitments 4,492 4,492 — 4,492 — Interest rate swap contracts 145 145 — 145 — Liabilities Deposits $ 4,074,170 $ 4,069,098 $ — $ 4,069,098 $ — Short-term borrowings 124,235 124,235 — 124,235 — FHLB and other borrowings 640,631 641,050 — 641,050 — Subordinated debt 94,134 91,926 — 91,926 — Trust preferred debentures 47,794 56,805 — 56,805 — Accrued interest payable 4,855 4,855 — 4,855 — Interest rate swap contracts 145 145 — 145 — |
COMMITMENTS, CONTINGENCIES AN_2
COMMITMENTS, CONTINGENCIES AND CREDIT RISK (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
COMMITMENTS, CONTINGENCIES AND CREDIT RISK | |
Schedule of loan commitments | March 31, December 31, (dollars in thousands) 2019 2018 Commitments to extend credit $ 670,694 $ 663,555 Financial guarantees – standby letters of credit 140,183 142,859 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
SEGMENT INFORMATION | |
Schedule of segment financial information | Selected business segment financial information as of and for the three months ended March 31, 2019 and 2018 were as follows: Commercial FHA Origination and Wealth (dollars in thousands) Banking Servicing Management Other Total Three Months Ended March 31, 2019 Net interest income (expense) $ 48,518 $ (176) $ — $ (2,741) $ 45,601 Provision for loan losses 3,243 — — — 3,243 Noninterest income 8,940 3,238 4,953 (56) 17,075 Noninterest expense 35,371 2,811 3,247 (332) 41,097 Income before income taxes 18,844 251 1,706 (2,465) 18,336 Income taxes (benefit) 4,975 71 140 (832) 4,354 Net income (loss) $ 13,869 $ 180 $ 1,566 $ (1,633) $ 13,982 Total assets $ 5,582,494 $ 94,797 $ 19,039 $ (54,550) $ 5,641,780 Three Months Ended March 31, 2018 Net interest income (expense) $ 40,631 $ 37 $ 85 $ (2,568) $ 38,185 Provision for loan losses 2,006 — — — 2,006 Noninterest income 9,016 3,521 4,080 (115) 16,502 Noninterest expense 44,366 3,538 2,386 (791) 49,499 Income (loss) before income taxes (benefit) 3,275 20 1,779 (1,892) 3,182 Income taxes (benefit) 1,379 407 141 (551) 1,376 Net income (loss) $ 1,896 $ (387) $ 1,638 $ (1,341) $ 1,806 Total assets $ 5,671,231 $ 91,580 $ 16,573 $ (56,012) $ 5,723,372 |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
LEASES | |
Summary of information related to operating leases | Three Months Ended (dollars in thousands) March 31, 2019 Operating lease cost $ 708 Operating cash flows from leases 741 Right-of-use assets obtained in exchange for lease obligations 10,677 Weighted average remaining lease term 6 years Weighted average discount rate 3.12 % |
Summary of projected minimum rental payments | (dollars in thousands) Amount Year ending December 31: 2019 remaining $ 2,482 2020 2,288 2021 2,160 2022 2,060 2023 1,292 Thereafter 2,057 Total future minimum lease payments 12,339 Less imputed interest (1,141) Total operating lease liabilities $ 11,198 |
REVENUE FROM CONTRACT WITH CU_2
REVENUE FROM CONTRACT WITH CUSTOMERS (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Revenue from contract with customers | |
Summary of noninterest income, segregated by revenue | Three Months Ended March 31, (dollars in thousands) 2019 2018 Noninterest income - in-scope of Topic 606 Wealth management revenue: Trust management/administration fees $ 3,617 $ 3,119 Investment advisory fees 529 465 Investment brokerage fees 219 264 Other 588 231 Service charges on deposit accounts: Nonsufficient fund fees 1,754 1,450 Other 766 517 Interchange revenues 2,680 2,045 Other income: Merchant services revenue 375 338 Other 818 1,070 Noninterest income - out-of-scope of Topic 606 5,729 7,003 Total noninterest income $ 17,075 $ 16,502 |
BASIS OF PRESENTATION AND SUM_3
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019USD ($)loan | Jan. 01, 2019USD ($) | |
Operating lease right-of-use asset | $ 10,677 | |
Operating lease liabilities | $ 11,198 | |
Number of distinct loan portfolio | loan | 12 | |
ASU 2016-02 | ||
Operating lease right-of-use asset | $ 12,100 | |
Operating lease liabilities | $ 12,100 |
ACQUISITIONS - Alpine (Details)
ACQUISITIONS - Alpine (Details) $ in Thousands | Feb. 28, 2018USD ($)stateshares | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) |
Liabilities assumed: | |||
Goodwill | $ 164,673 | $ 164,673 | |
Alpine Bank | |||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||
Number of service banking centers acquired | state | 19 | ||
Total consideration | $ 173,200 | ||
Cash transferred | $ 33,300 | ||
Shares issued | shares | 4,463,200 | ||
Transaction and integration costs | $ 22,400 |
INVESTMENT SECURITIES - Classif
INVESTMENT SECURITIES - Classified (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2019 | Dec. 31, 2018 | |
Available for sale securities | ||
Amortized cost | $ 647,939 | |
Gross unrealized gains | 7,337 | |
Gross unrealized losses | 2,537 | |
Investment securities available for sale | 652,739 | |
Equity securities | 3,413 | $ 3,334 |
U.S. Treasury securities | ||
Available for sale securities | ||
Amortized cost | 25,009 | 25,018 |
Gross unrealized losses | 241 | 368 |
Investment securities available for sale | 24,768 | 24,650 |
Government sponsored entity debt securities | ||
Available for sale securities | ||
Amortized cost | 75,620 | 76,554 |
Gross unrealized gains | 133 | 17 |
Gross unrealized losses | 166 | 887 |
Investment securities available for sale | 75,587 | 75,684 |
Agency mortgage-backed securities | ||
Available for sale securities | ||
Amortized cost | 321,127 | 329,690 |
Gross unrealized gains | 1,840 | 371 |
Gross unrealized losses | 1,516 | 3,756 |
Investment securities available for sale | 321,451 | 326,305 |
State and municipal securities | ||
Available for sale securities | ||
Amortized cost | 146,557 | 156,795 |
Gross unrealized gains | 4,501 | 3,282 |
Gross unrealized losses | 146 | 815 |
Investment securities available for sale | 150,912 | 159,262 |
Corporate Securities | ||
Available for sale securities | ||
Amortized cost | 79,626 | 72,302 |
Gross unrealized gains | 863 | 383 |
Gross unrealized losses | 468 | 1,135 |
Investment securities available for sale | $ 80,021 | 71,550 |
Equity Security | ||
Available for sale securities | ||
Amortized cost | 660,359 | |
Gross unrealized gains | 4,053 | |
Gross unrealized losses | 6,961 | |
Investment securities available for sale | $ 657,451 |
INVESTMENT SECURITIES - Continu
INVESTMENT SECURITIES - Continuous unrealized loss position (Details) $ in Thousands | Mar. 31, 2019USD ($)item | Dec. 31, 2018USD ($) |
Securities available for sale: | ||
Less than 12 Months, Fair value | $ 45,975 | $ 244,251 |
Less than 12 Months, Unrealized loss | 223 | 1,445 |
12 Months or more, Fair value | 204,620 | 205,649 |
12 Months or more, Unrealized loss | 2,314 | 5,516 |
Total, Fair value | 250,595 | 449,900 |
Total, Unrealized loss | $ 2,537 | 6,961 |
Unrealized loss | ||
Debt Securities Available For Sale Unrealized Loss Position Number Of Positions | item | 141 | |
Aggregate depreciation | 1.00% | |
U.S. Treasury securities | ||
Securities available for sale: | ||
Less than 12 Months, Fair value | $ 5,004 | 5,012 |
Less than 12 Months, Unrealized loss | 1 | 1 |
12 Months or more, Fair value | 19,764 | 19,638 |
12 Months or more, Unrealized loss | 240 | 367 |
Total, Fair value | 24,768 | 24,650 |
Total, Unrealized loss | 241 | 368 |
Government sponsored entity debt securities | ||
Securities available for sale: | ||
Less than 12 Months, Fair value | 6,056 | 51,717 |
Less than 12 Months, Unrealized loss | 8 | 195 |
12 Months or more, Fair value | 34,855 | 23,223 |
12 Months or more, Unrealized loss | 158 | 692 |
Total, Fair value | 40,911 | 74,940 |
Total, Unrealized loss | 166 | 887 |
Agency mortgage-backed securities | ||
Securities available for sale: | ||
Less than 12 Months, Fair value | 13,390 | 139,115 |
Less than 12 Months, Unrealized loss | 26 | 528 |
12 Months or more, Fair value | 124,358 | 126,561 |
12 Months or more, Unrealized loss | 1,490 | 3,228 |
Total, Fair value | 137,748 | 265,676 |
Total, Unrealized loss | 1,516 | 3,756 |
State and municipal securities | ||
Securities available for sale: | ||
Less than 12 Months, Fair value | 5,429 | 15,791 |
Less than 12 Months, Unrealized loss | 2 | 146 |
12 Months or more, Fair value | 16,839 | 27,692 |
12 Months or more, Unrealized loss | 144 | 669 |
Total, Fair value | 22,268 | 43,483 |
Total, Unrealized loss | 146 | 815 |
Corporate Securities | ||
Securities available for sale: | ||
Less than 12 Months, Fair value | 16,096 | 32,616 |
Less than 12 Months, Unrealized loss | 186 | 575 |
12 Months or more, Fair value | 8,804 | 8,535 |
12 Months or more, Unrealized loss | 282 | 560 |
Total, Fair value | 24,900 | 41,151 |
Total, Unrealized loss | $ 468 | $ 1,135 |
INVESTMENT SECURITIES - Amortiz
INVESTMENT SECURITIES - Amortized cost and fair value (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Amortized cost of available-for-sale securities, by contractual maturity | ||
Within one year | $ 45,564,000 | |
After one year through five years | 110,602,000 | |
After five years through ten years | 142,380,000 | |
After ten years | 28,266,000 | |
Total, single maturity date | 647,939,000 | |
Fair Value of available-for-sale securities, by contractual maturity | ||
Within one year | 45,610,000 | |
After one year through five years | 111,624,000 | |
After five years through ten years | 145,013,000 | |
After ten years | 29,041,000 | |
Total, single maturity date | 652,739,000 | |
Proceeds from Sale of Available-for-sale Securities | ||
Proceed from sale of investments | $ 1,609,000 | |
Gross realized gains/losses | ||
Gross realized gains | 65,000 | |
Gross realized losses | 0 | |
Equity securities, unrealized gains | 67,000 | 111,000 |
Sales of equity securities | 0 | $ 0 |
Mortgage-backed securities | ||
Amortized cost of available-for-sale securities, by contractual maturity | ||
Total, single maturity date | 321,127,000 | |
Fair Value of available-for-sale securities, by contractual maturity | ||
Total, single maturity date | $ 321,451,000 |
LOANS - Summary of loans (Detai
LOANS - Summary of loans (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Summary of loans | |||
Loans | $ 4,092,106 | $ 4,137,551 | |
Loans, additional information | |||
Net deferred loan fees | 7,300 | 11,600 | |
Unearned income | 32,900 | 29,200 | |
Loans held for sale | 16,851 | 30,401 | |
Proceeds from sales of loans held for sale | 99,323 | $ 154,020 | |
Directors, executive officers, principal shareholders and affiliates | |||
Loans to certain directors, executive officers, principal shareholders and their affiliates: | |||
Loans outstanding to related parties | 23,500 | 26,500 | |
New loans to related parties and other additions | 1,500 | ||
Repayments from related parties and other reductions | 4,500 | ||
Commercial real estate | |||
Summary of loans | |||
Loans | 2,642,892 | 2,682,268 | |
Commercial real estate | Commercial | |||
Summary of loans | |||
Loans | 843,089 | 810,884 | |
Commercial real estate | Commercial real estate | |||
Summary of loans | |||
Loans | 1,560,427 | 1,639,155 | |
Commercial real estate | Construction and land development | |||
Summary of loans | |||
Loans | 239,376 | 232,229 | |
Other loan portfolio | Residential real estate | |||
Summary of loans | |||
Loans | 569,051 | 578,048 | |
Other loan portfolio | Consumer | |||
Summary of loans | |||
Loans | 600,631 | 613,184 | |
Other loan portfolio | Lease financing | |||
Summary of loans | |||
Loans | 279,532 | 264,051 | |
Commercial and Residential Loan | |||
Loans, additional information | |||
Loans held for sale | 16,900 | 30,400 | |
Proceeds from sales of loans held for sale | 99,300 | $ 154,000 | |
Non-PCI loans | |||
Summary of loans | |||
Loans | 4,055,170 | 4,094,576 | |
Non-PCI loans | Commercial real estate | |||
Summary of loans | |||
Loans | 2,616,060 | 2,649,828 | |
Non-PCI loans | Commercial real estate | Commercial | |||
Summary of loans | |||
Loans | 839,731 | 806,027 | |
Non-PCI loans | Commercial real estate | Commercial real estate | |||
Summary of loans | |||
Loans | 1,542,997 | 1,619,903 | |
Non-PCI loans | Commercial real estate | Construction and land development | |||
Summary of loans | |||
Loans | 233,332 | 223,898 | |
Non-PCI loans | Other loan portfolio | |||
Summary of loans | |||
Loans | 1,439,110 | 1,444,748 | |
Non-PCI loans | Other loan portfolio | Residential real estate | |||
Summary of loans | |||
Loans | 560,427 | 569,289 | |
Non-PCI loans | Other loan portfolio | Consumer | |||
Summary of loans | |||
Loans | 599,151 | 611,408 | |
Non-PCI loans | Other loan portfolio | Lease financing | |||
Summary of loans | |||
Loans | 279,532 | 264,051 | |
PCI loans | |||
Summary of loans | |||
Loans | 36,936 | 42,975 | |
Customer outstanding balances | 50,500 | 56,900 | |
PCI loans | Commercial real estate | |||
Summary of loans | |||
Loans | 26,832 | 32,440 | |
PCI loans | Commercial real estate | Commercial | |||
Summary of loans | |||
Loans | 3,358 | 4,857 | |
PCI loans | Commercial real estate | Commercial real estate | |||
Summary of loans | |||
Loans | 17,430 | 19,252 | |
PCI loans | Commercial real estate | Construction and land development | |||
Summary of loans | |||
Loans | 6,044 | 8,331 | |
PCI loans | Other loan portfolio | Residential real estate | |||
Summary of loans | |||
Loans | 8,624 | 8,759 | |
PCI loans | Other loan portfolio | Consumer | |||
Summary of loans | |||
Loans | $ 1,480 | $ 1,776 |
LOANS - Risk category (Details)
LOANS - Risk category (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019USD ($)region | Dec. 31, 2018USD ($) | |
Risk category | ||
Number of main regions | region | 4 | |
Loans and Leases Receivable, Gross, Total | $ 4,092,106 | $ 4,137,551 |
Commercial real estate | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 2,642,892 | 2,682,268 |
Non-PCI loans | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 4,055,170 | 4,094,576 |
Non-PCI loans | Commercial real estate | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 2,616,060 | 2,649,828 |
Non-PCI loans | Commercial real estate | Acceptable credit quality | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 2,466,052 | 2,503,221 |
Non-PCI loans | Commercial real estate | Special mention | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 38,270 | 53,857 |
Non-PCI loans | Commercial real estate | Substandard | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 73,962 | 61,115 |
Non-PCI loans | Commercial real estate | Substandard - nonaccrual | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 36,977 | 31,154 |
Non-PCI loans | Commercial real estate | Not graded | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 799 | 481 |
Non-PCI loans | Other loan portfolio | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 1,439,110 | 1,444,748 |
Non-PCI loans | Other loan portfolio | Performing | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 1,429,576 | 1,435,952 |
Non-PCI loans | Other loan portfolio | Impaired | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 9,534 | 8,796 |
Commercial | Commercial real estate | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 843,089 | 810,884 |
Commercial | Non-PCI loans | Commercial real estate | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 839,731 | 806,027 |
Commercial | Non-PCI loans | Commercial real estate | Acceptable credit quality | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 788,619 | 748,296 |
Commercial | Non-PCI loans | Commercial real estate | Special mention | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 21,121 | 35,103 |
Commercial | Non-PCI loans | Commercial real estate | Substandard | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 21,498 | 14,139 |
Commercial | Non-PCI loans | Commercial real estate | Substandard - nonaccrual | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 8,493 | 8,489 |
Commercial real estate | Commercial real estate | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 1,560,427 | 1,639,155 |
Commercial real estate | Non-PCI loans | Commercial real estate | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 1,542,997 | 1,619,903 |
Commercial real estate | Non-PCI loans | Commercial real estate | Acceptable credit quality | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 1,449,480 | 1,536,127 |
Commercial real estate | Non-PCI loans | Commercial real estate | Special mention | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 14,627 | 15,306 |
Commercial real estate | Non-PCI loans | Commercial real estate | Substandard | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 51,574 | 46,976 |
Commercial real estate | Non-PCI loans | Commercial real estate | Substandard - nonaccrual | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 27,316 | 21,494 |
Construction and land development | Commercial real estate | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 239,376 | 232,229 |
Construction and land development | Non-PCI loans | Commercial real estate | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 233,332 | 223,898 |
Construction and land development | Non-PCI loans | Commercial real estate | Acceptable credit quality | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 227,953 | 218,798 |
Construction and land development | Non-PCI loans | Commercial real estate | Special mention | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 2,522 | 3,448 |
Construction and land development | Non-PCI loans | Commercial real estate | Substandard | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 890 | |
Construction and land development | Non-PCI loans | Commercial real estate | Substandard - nonaccrual | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 1,168 | 1,171 |
Construction and land development | Non-PCI loans | Commercial real estate | Not graded | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 799 | 481 |
Residential real estate | Other loan portfolio | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 569,051 | 578,048 |
Residential real estate | Non-PCI loans | Other loan portfolio | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 560,427 | 569,289 |
Residential real estate | Non-PCI loans | Other loan portfolio | Performing | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 552,674 | 562,019 |
Residential real estate | Non-PCI loans | Other loan portfolio | Impaired | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 7,753 | 7,270 |
Consumer | Other loan portfolio | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 600,631 | 613,184 |
Consumer | Non-PCI loans | Other loan portfolio | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 599,151 | 611,408 |
Consumer | Non-PCI loans | Other loan portfolio | Performing | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 598,618 | 610,839 |
Consumer | Non-PCI loans | Other loan portfolio | Impaired | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 533 | 569 |
Lease financing | Other loan portfolio | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 279,532 | 264,051 |
Lease financing | Non-PCI loans | Other loan portfolio | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 279,532 | 264,051 |
Lease financing | Non-PCI loans | Other loan portfolio | Performing | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | 278,284 | 263,094 |
Lease financing | Non-PCI loans | Other loan portfolio | Impaired | ||
Risk category | ||
Loans and Leases Receivable, Gross, Total | $ 1,248 | $ 957 |
LOANS - Impaired Loans (Details
LOANS - Impaired Loans (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Interest income : | |||
Interest income recognized on nonaccrual loans | $ 0 | $ 0 | |
Additional interest income that would have been recorded had they been current | 653,000 | 500,000 | |
Recognized interest income on loans modified under troubled debt restructurings | 32,000 | $ 30,000 | |
PCI loans | |||
Summary of impaired loans | |||
Total impaired loans | 36,900,000 | $ 43,000,000 | |
Non-PCI loans | Impaired | |||
Summary of impaired loans | |||
Total impaired loans | 49,262,000 | 42,899,000 | |
Commercial real estate | Commercial | Non-PCI loans | Impaired | |||
Summary of impaired loans | |||
Total impaired loans | 8,899,000 | 8,928,000 | |
Commercial real estate | Commercial real estate | Non-PCI loans | Impaired | |||
Summary of impaired loans | |||
Total impaired loans | 29,611,000 | 23,868,000 | |
Commercial real estate | Construction and land development | Non-PCI loans | Impaired | |||
Summary of impaired loans | |||
Total impaired loans | 1,218,000 | 1,307,000 | |
Other loan portfolio | Residential real estate | Non-PCI loans | Impaired | |||
Summary of impaired loans | |||
Total impaired loans | 7,753,000 | 7,270,000 | |
Other loan portfolio | Consumer | Non-PCI loans | Impaired | |||
Summary of impaired loans | |||
Total impaired loans | 533,000 | 569,000 | |
Other loan portfolio | Lease financing | Non-PCI loans | Impaired | |||
Summary of impaired loans | |||
Total impaired loans | $ 1,248,000 | $ 957,000 |
LOANS - Impaired Loans Individu
LOANS - Impaired Loans Individually Evaluated (excluding PCI loans) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Impaired loans (excluding PCI loans) by portfolio | |||
Difference between the recorded investment and unpaid principal balance | $ 11,800 | $ 11,400 | |
Impaired | Non-PCI loans | |||
Impaired loans (excluding PCI loans) by portfolio | |||
With a valuation allowance, Recorded Investment | 19,323 | 20,861 | |
With a valuation allowance, Unpaid Principal Balance | 20,932 | 27,989 | |
With a valuation allowance, Average Annual Recorded Investment | 19,372 | $ 9,297 | |
With a related valuation allowance, Interest Income Recognized while on Impaired Status | 43 | 41 | |
With no related valuation allowance, Recorded Investment | 29,939 | 22,038 | |
With no related valuation allowance, Unpaid Principal Balance | 40,092 | 26,301 | |
With no related valuation allowance, Average Annual Recorded Investment | 30,117 | 17,647 | |
With no related valuation allowance, Interest Income Recognized while on Impaired Status | 3 | 1 | |
Total impaired loans | 49,262 | 42,899 | |
Total, Unpaid Principal Balance | 61,024 | 54,290 | |
Total, Related Valuation Allowance | 7,880 | 5,985 | |
Total, Average Annual Recorded Investment | 49,489 | 26,944 | |
Total, Interest Income Recognized While on Impaired Status | 46 | 42 | |
Commercial | Impaired | Commercial real estate | Non-PCI loans | |||
Impaired loans (excluding PCI loans) by portfolio | |||
With a valuation allowance, Recorded Investment | 8,191 | 7,945 | |
With a valuation allowance, Unpaid Principal Balance | 8,356 | 8,102 | |
With a valuation allowance, Average Annual Recorded Investment | 8,240 | 2,291 | |
With a related valuation allowance, Interest Income Recognized while on Impaired Status | 6 | 10 | |
With no related valuation allowance, Recorded Investment | 708 | 983 | |
With no related valuation allowance, Unpaid Principal Balance | 4,124 | 4,392 | |
With no related valuation allowance, Average Annual Recorded Investment | 723 | 518 | |
Total impaired loans | 8,899 | 8,928 | |
Total, Unpaid Principal Balance | 12,480 | 12,494 | |
Total, Related Valuation Allowance | 4,730 | 4,448 | |
Total, Average Annual Recorded Investment | 8,963 | 2,809 | |
Total, Interest Income Recognized While on Impaired Status | 6 | 10 | |
Commercial real estate | Impaired | Commercial real estate | Non-PCI loans | |||
Impaired loans (excluding PCI loans) by portfolio | |||
With a valuation allowance, Recorded Investment | 5,592 | 7,496 | |
With a valuation allowance, Unpaid Principal Balance | 6,221 | 13,844 | |
With a valuation allowance, Average Annual Recorded Investment | 5,563 | 2,104 | |
With a related valuation allowance, Interest Income Recognized while on Impaired Status | 27 | 20 | |
With no related valuation allowance, Recorded Investment | 24,019 | 16,372 | |
With no related valuation allowance, Unpaid Principal Balance | 30,492 | 16,921 | |
With no related valuation allowance, Average Annual Recorded Investment | 24,153 | 13,731 | |
Total impaired loans | 29,611 | 23,868 | |
Total, Unpaid Principal Balance | 36,713 | 30,765 | |
Total, Related Valuation Allowance | 2,437 | 523 | |
Total, Average Annual Recorded Investment | 29,716 | 15,835 | |
Total, Interest Income Recognized While on Impaired Status | 27 | 20 | |
Construction and land development | Impaired | Commercial real estate | Non-PCI loans | |||
Impaired loans (excluding PCI loans) by portfolio | |||
With a valuation allowance, Recorded Investment | 125 | 171 | |
With a valuation allowance, Unpaid Principal Balance | 169 | 171 | |
With a valuation allowance, Average Annual Recorded Investment | 141 | 101 | |
With a related valuation allowance, Interest Income Recognized while on Impaired Status | 1 | ||
With no related valuation allowance, Recorded Investment | 1,093 | 1,136 | |
With no related valuation allowance, Unpaid Principal Balance | 1,093 | 1,136 | |
With no related valuation allowance, Average Annual Recorded Investment | 1,110 | 739 | |
With no related valuation allowance, Interest Income Recognized while on Impaired Status | 1 | ||
Total impaired loans | 1,218 | 1,307 | |
Total, Unpaid Principal Balance | 1,262 | 1,307 | |
Total, Related Valuation Allowance | 14 | 54 | |
Total, Average Annual Recorded Investment | 1,251 | 840 | |
Total, Interest Income Recognized While on Impaired Status | 1 | 1 | |
Residential real estate | Impaired | Other loan portfolio | Non-PCI loans | |||
Impaired loans (excluding PCI loans) by portfolio | |||
With a valuation allowance, Recorded Investment | 4,457 | 4,055 | |
With a valuation allowance, Unpaid Principal Balance | 5,203 | 4,662 | |
With a valuation allowance, Average Annual Recorded Investment | 4,465 | 3,579 | |
With a related valuation allowance, Interest Income Recognized while on Impaired Status | 10 | 10 | |
With no related valuation allowance, Recorded Investment | 3,296 | 3,215 | |
With no related valuation allowance, Unpaid Principal Balance | 3,557 | 3,516 | |
With no related valuation allowance, Average Annual Recorded Investment | 3,306 | 2,370 | |
With no related valuation allowance, Interest Income Recognized while on Impaired Status | 2 | 1 | |
Total impaired loans | 7,753 | 7,270 | |
Total, Unpaid Principal Balance | 8,760 | 8,178 | |
Total, Related Valuation Allowance | 512 | 554 | |
Total, Average Annual Recorded Investment | 7,771 | 5,949 | |
Total, Interest Income Recognized While on Impaired Status | 12 | 11 | |
Consumer | Impaired | Other loan portfolio | Non-PCI loans | |||
Impaired loans (excluding PCI loans) by portfolio | |||
With a valuation allowance, Recorded Investment | 522 | 428 | |
With a valuation allowance, Unpaid Principal Balance | 547 | 444 | |
With a valuation allowance, Average Annual Recorded Investment | 527 | 208 | |
With no related valuation allowance, Recorded Investment | 11 | 141 | |
With no related valuation allowance, Unpaid Principal Balance | 13 | 145 | |
With no related valuation allowance, Average Annual Recorded Investment | 12 | 42 | |
Total impaired loans | 533 | 569 | |
Total, Unpaid Principal Balance | 560 | 589 | |
Total, Related Valuation Allowance | 41 | 45 | |
Total, Average Annual Recorded Investment | 539 | 250 | |
Lease financing | Impaired | Other loan portfolio | Non-PCI loans | |||
Impaired loans (excluding PCI loans) by portfolio | |||
With a valuation allowance, Recorded Investment | 436 | 766 | |
With a valuation allowance, Unpaid Principal Balance | 436 | 766 | |
With a valuation allowance, Average Annual Recorded Investment | 436 | 1,014 | |
With no related valuation allowance, Recorded Investment | 812 | 191 | |
With no related valuation allowance, Unpaid Principal Balance | 813 | 191 | |
With no related valuation allowance, Average Annual Recorded Investment | 813 | 247 | |
Total impaired loans | 1,248 | 957 | |
Total, Unpaid Principal Balance | 1,249 | 957 | |
Total, Related Valuation Allowance | 146 | $ 361 | |
Total, Average Annual Recorded Investment | $ 1,249 | $ 1,261 |
LOANS - Aging Status of recorde
LOANS - Aging Status of recorded investment (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Aging Status of recorded investment | ||
Loans and Leases Receivable, Gross, Total | $ 4,092,106 | $ 4,137,551 |
Non-PCI loans | ||
Aging Status of recorded investment | ||
Nonaccrual Loans | 45,285 | 38,187 |
Total Past Due | 69,539 | 64,461 |
Current | 3,985,631 | 4,030,115 |
Loans and Leases Receivable, Gross, Total | 4,055,170 | 4,094,576 |
Non-PCI loans | 31-59 Days Past Due | ||
Aging Status of recorded investment | ||
Past Due | 16,074 | 17,494 |
Non-PCI loans | 60-89 Days Past Due | ||
Aging Status of recorded investment | ||
Past Due | 7,925 | 7,719 |
Non-PCI loans | Accruing Loans past Due 90 Days or More | ||
Aging Status of recorded investment | ||
Past Due | 255 | 1,061 |
Commercial real estate | ||
Aging Status of recorded investment | ||
Loans and Leases Receivable, Gross, Total | 2,642,892 | 2,682,268 |
Commercial real estate | Non-PCI loans | ||
Aging Status of recorded investment | ||
Loans and Leases Receivable, Gross, Total | 2,616,060 | 2,649,828 |
Other loan portfolio | Non-PCI loans | ||
Aging Status of recorded investment | ||
Loans and Leases Receivable, Gross, Total | 1,439,110 | 1,444,748 |
Other loan portfolio | Non-PCI loans | Impaired | ||
Aging Status of recorded investment | ||
Loans and Leases Receivable, Gross, Total | 9,534 | 8,796 |
Commercial | Commercial real estate | ||
Aging Status of recorded investment | ||
Loans and Leases Receivable, Gross, Total | 843,089 | 810,884 |
Commercial | Commercial real estate | Non-PCI loans | ||
Aging Status of recorded investment | ||
Nonaccrual Loans | 8,493 | 8,489 |
Total Past Due | 12,963 | 15,087 |
Current | 826,768 | 790,940 |
Loans and Leases Receivable, Gross, Total | 839,731 | 806,027 |
Commercial | Commercial real estate | Non-PCI loans | 31-59 Days Past Due | ||
Aging Status of recorded investment | ||
Past Due | 2,323 | 4,013 |
Commercial | Commercial real estate | Non-PCI loans | 60-89 Days Past Due | ||
Aging Status of recorded investment | ||
Past Due | 2,147 | 2,581 |
Commercial | Commercial real estate | Non-PCI loans | Accruing Loans past Due 90 Days or More | ||
Aging Status of recorded investment | ||
Past Due | 4 | |
Commercial real estate | Commercial real estate | ||
Aging Status of recorded investment | ||
Loans and Leases Receivable, Gross, Total | 1,560,427 | 1,639,155 |
Commercial real estate | Commercial real estate | Non-PCI loans | ||
Aging Status of recorded investment | ||
Nonaccrual Loans | 27,316 | 21,494 |
Total Past Due | 33,338 | 24,255 |
Current | 1,509,659 | 1,595,648 |
Loans and Leases Receivable, Gross, Total | 1,542,997 | 1,619,903 |
Commercial real estate | Commercial real estate | Non-PCI loans | 31-59 Days Past Due | ||
Aging Status of recorded investment | ||
Past Due | 4,862 | 1,667 |
Commercial real estate | Commercial real estate | Non-PCI loans | 60-89 Days Past Due | ||
Aging Status of recorded investment | ||
Past Due | 1,160 | 945 |
Commercial real estate | Commercial real estate | Non-PCI loans | Accruing Loans past Due 90 Days or More | ||
Aging Status of recorded investment | ||
Past Due | 149 | |
Construction and land development | Commercial real estate | ||
Aging Status of recorded investment | ||
Loans and Leases Receivable, Gross, Total | 239,376 | 232,229 |
Construction and land development | Commercial real estate | Non-PCI loans | ||
Aging Status of recorded investment | ||
Nonaccrual Loans | 1,168 | 1,171 |
Total Past Due | 2,348 | 2,245 |
Current | 230,984 | 221,653 |
Loans and Leases Receivable, Gross, Total | 233,332 | 223,898 |
Construction and land development | Commercial real estate | Non-PCI loans | 31-59 Days Past Due | ||
Aging Status of recorded investment | ||
Past Due | 1,020 | 989 |
Construction and land development | Commercial real estate | Non-PCI loans | 60-89 Days Past Due | ||
Aging Status of recorded investment | ||
Past Due | 160 | |
Construction and land development | Commercial real estate | Non-PCI loans | Accruing Loans past Due 90 Days or More | ||
Aging Status of recorded investment | ||
Past Due | 85 | |
Residential real estate | Other loan portfolio | ||
Aging Status of recorded investment | ||
Loans and Leases Receivable, Gross, Total | 569,051 | 578,048 |
Residential real estate | Other loan portfolio | Non-PCI loans | ||
Aging Status of recorded investment | ||
Nonaccrual Loans | 6,884 | 5,894 |
Total Past Due | 8,905 | 8,480 |
Current | 551,522 | 560,809 |
Loans and Leases Receivable, Gross, Total | 560,427 | 569,289 |
Residential real estate | Other loan portfolio | Non-PCI loans | Impaired | ||
Aging Status of recorded investment | ||
Loans and Leases Receivable, Gross, Total | 7,753 | 7,270 |
Residential real estate | Other loan portfolio | Non-PCI loans | 31-59 Days Past Due | ||
Aging Status of recorded investment | ||
Past Due | 1,305 | 1,292 |
Residential real estate | Other loan portfolio | Non-PCI loans | 60-89 Days Past Due | ||
Aging Status of recorded investment | ||
Past Due | 716 | 728 |
Residential real estate | Other loan portfolio | Non-PCI loans | Accruing Loans past Due 90 Days or More | ||
Aging Status of recorded investment | ||
Past Due | 566 | |
Consumer | Other loan portfolio | ||
Aging Status of recorded investment | ||
Loans and Leases Receivable, Gross, Total | 600,631 | 613,184 |
Consumer | Other loan portfolio | Non-PCI loans | ||
Aging Status of recorded investment | ||
Nonaccrual Loans | 431 | 388 |
Total Past Due | 8,531 | 8,183 |
Current | 590,620 | 603,225 |
Loans and Leases Receivable, Gross, Total | 599,151 | 611,408 |
Consumer | Other loan portfolio | Non-PCI loans | Impaired | ||
Aging Status of recorded investment | ||
Loans and Leases Receivable, Gross, Total | 533 | 569 |
Consumer | Other loan portfolio | Non-PCI loans | 31-59 Days Past Due | ||
Aging Status of recorded investment | ||
Past Due | 4,735 | 5,211 |
Consumer | Other loan portfolio | Non-PCI loans | 60-89 Days Past Due | ||
Aging Status of recorded investment | ||
Past Due | 3,365 | 2,533 |
Consumer | Other loan portfolio | Non-PCI loans | Accruing Loans past Due 90 Days or More | ||
Aging Status of recorded investment | ||
Past Due | 51 | |
Lease financing | Other loan portfolio | ||
Aging Status of recorded investment | ||
Loans and Leases Receivable, Gross, Total | 279,532 | 264,051 |
Lease financing | Other loan portfolio | Non-PCI loans | ||
Aging Status of recorded investment | ||
Nonaccrual Loans | 993 | 751 |
Total Past Due | 3,454 | 6,211 |
Current | 276,078 | 257,840 |
Loans and Leases Receivable, Gross, Total | 279,532 | 264,051 |
Lease financing | Other loan portfolio | Non-PCI loans | Impaired | ||
Aging Status of recorded investment | ||
Loans and Leases Receivable, Gross, Total | 1,248 | 957 |
Lease financing | Other loan portfolio | Non-PCI loans | 31-59 Days Past Due | ||
Aging Status of recorded investment | ||
Past Due | 1,829 | 4,322 |
Lease financing | Other loan portfolio | Non-PCI loans | 60-89 Days Past Due | ||
Aging Status of recorded investment | ||
Past Due | 377 | 932 |
Lease financing | Other loan portfolio | Non-PCI loans | Accruing Loans past Due 90 Days or More | ||
Aging Status of recorded investment | ||
Past Due | $ 255 | $ 206 |
LOANS - TDRs by portfolio (Deta
LOANS - TDRs by portfolio (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Troubled debt restructuring | ||
Allowance for loan losses on TDRs | $ 446,000 | $ 557,000 |
Unfunded commitments | 0 | 0 |
TDRs by loan portfolio (excluding PCI loans): | ||
TDR's Accruing | 3,722,000 | 3,651,000 |
TDR's Nonaccrual | 12,527,000 | 10,362,000 |
Total | 16,249,000 | 14,013,000 |
Minimum | Performing | ||
Troubled debt restructuring | ||
TDRs, individually evaluated for impairment, threshold | 50,000 | |
Commercial | Commercial real estate | Non-PCI loans | ||
TDRs by loan portfolio (excluding PCI loans): | ||
TDR's Accruing | 406,000 | 435,000 |
TDR's Nonaccrual | 399,000 | 406,000 |
Total | 805,000 | 841,000 |
Commercial real estate | Commercial real estate | Non-PCI loans | ||
TDRs by loan portfolio (excluding PCI loans): | ||
TDR's Accruing | 2,295,000 | 2,225,000 |
TDR's Nonaccrual | 10,713,000 | 9,103,000 |
Total | 13,008,000 | 11,328,000 |
Construction and land development | Commercial real estate | Non-PCI loans | ||
TDRs by loan portfolio (excluding PCI loans): | ||
TDR's Accruing | 50,000 | 51,000 |
TDR's Nonaccrual | 17,000 | |
Total | 67,000 | 51,000 |
Residential real estate | Other loan portfolio | Non-PCI loans | ||
TDRs by loan portfolio (excluding PCI loans): | ||
TDR's Accruing | 869,000 | 810,000 |
TDR's Nonaccrual | 1,398,000 | 853,000 |
Total | 2,267,000 | 1,663,000 |
Consumer | Other loan portfolio | Non-PCI loans | ||
TDRs by loan portfolio (excluding PCI loans): | ||
TDR's Accruing | 102,000 | 130,000 |
Total | $ 102,000 | $ 130,000 |
LOANS - TDRs by portfolio - res
LOANS - TDRs by portfolio - restructured and subsequently defaulted (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($)loan | |
Troubled debt restructurings: | |
Number of loans | loan | 12 |
Pre-modification outstanding balance | $ 2,225 |
Post-modification outstanding balance | $ 2,092 |
Troubled debt restructurings that subsequently defaulted | |
Number of loans | loan | 1 |
Recorded balance | $ 43 |
Commercial real estate | Commercial real estate | |
Troubled debt restructurings: | |
Number of loans | loan | 3 |
Pre-modification outstanding balance | $ 1,924 |
Post-modification outstanding balance | $ 1,838 |
Construction and land development | Commercial real estate | |
Troubled debt restructurings: | |
Number of loans | loan | 1 |
Pre-modification outstanding balance | $ 62 |
Post-modification outstanding balance | $ 17 |
Troubled debt restructurings that subsequently defaulted | |
Number of loans | loan | 1 |
Recorded balance | $ 43 |
Residential real estate | Other loan portfolio | |
Troubled debt restructurings: | |
Number of loans | loan | 7 |
Pre-modification outstanding balance | $ 224 |
Post-modification outstanding balance | $ 222 |
Consumer | Other loan portfolio | |
Troubled debt restructurings: | |
Number of loans | loan | 1 |
Pre-modification outstanding balance | $ 15 |
Post-modification outstanding balance | $ 15 |
LOANS - PCI Loans - Changes in
LOANS - PCI Loans - Changes in the accretable yield for PCI loans (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Summary of loans | ||
Accretion recorded as loan interest income | $ 42,358 | $ 36,179 |
PCI loans | ||
Changes in the accretable yield for PCI loans | ||
Balance, beginning of period | 12,240 | 5,732 |
Accretion | (1,076) | (1,161) |
Other adjustments (including maturities, charge-offs and impact of changes in timing of expected cash flows) | (106) | 660 |
Reclassification from (to) non-accretable | 5 | 1,154 |
Balance, end of period | $ 11,063 | 7,227 |
Alpine Bank | PCI loans | ||
Changes in the accretable yield for PCI loans | ||
New loans purchased | $ 842 |
LOANS - Allowance for loan loss
LOANS - Allowance for loan losses (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Changes in allowance for loan losses : | ||
Beginning balance | $ 20,903 | $ 16,431 |
Provision for loan losses | 3,243 | 2,006 |
Allowance for Loan and Lease Losses Write-offs, Net [Abstract] | ||
Loan charge-offs | (1,382) | (1,141) |
Loan recoveries | 327 | 408 |
Ending balance | $ 23,091 | $ 17,704 |
LOANS - Allowance for loan lo_2
LOANS - Allowance for loan losses by loan portfolio and recorded investment (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Dec. 31, 2018 | |
Changes in allowance for loan losses : | ||||
Beginning balance | $ 20,903 | $ 16,431 | ||
Provision for loan losses | 3,243 | 2,006 | ||
Charge-offs | (1,382) | (1,141) | ||
Recoveries | 327 | 408 | ||
Ending balance | 23,091 | 17,704 | ||
Allowance for loan losses: | ||||
Loans individually evaluated for impairment | $ 7,353 | $ 5,492 | ||
Loans collectively evaluated for impairment | 527 | 493 | ||
Non-impaired loans collectively evaluated for impairment | 13,759 | 13,350 | ||
Loans acquired with deteriorated credit quality | 1,452 | 1,568 | ||
Total | 20,903 | 16,431 | 23,091 | 20,903 |
Recorded investment (loan balance): | ||||
Impaired loans individually evaluated for impairment | 43,998 | 37,802 | ||
Impaired loans collectively evaluated for impairment | 5,264 | 5,097 | ||
Non-impaired loans collectively evaluated for impairment | 4,005,908 | 4,051,677 | ||
Loans acquired with deteriorated credit quality | 36,936 | 42,975 | ||
Loans and Leases Receivable, Gross, Total | 4,092,106 | 4,137,551 | ||
PCI loans | ||||
Recorded investment (loan balance): | ||||
Loans and Leases Receivable, Gross, Total | 36,936 | 42,975 | ||
Commercial real estate | ||||
Recorded investment (loan balance): | ||||
Loans and Leases Receivable, Gross, Total | 2,642,892 | 2,682,268 | ||
Commercial real estate | PCI loans | ||||
Recorded investment (loan balance): | ||||
Loans and Leases Receivable, Gross, Total | 26,832 | 32,440 | ||
Commercial | Commercial real estate | ||||
Changes in allowance for loan losses : | ||||
Beginning balance | 9,524 | 5,256 | ||
Provision for loan losses | 118 | 567 | ||
Charge-offs | (112) | (25) | ||
Recoveries | 15 | 104 | ||
Ending balance | 9,545 | 5,902 | ||
Allowance for loan losses: | ||||
Loans individually evaluated for impairment | 4,671 | 4,405 | ||
Loans collectively evaluated for impairment | 59 | 43 | ||
Non-impaired loans collectively evaluated for impairment | 4,797 | 4,971 | ||
Loans acquired with deteriorated credit quality | 18 | 105 | ||
Total | 9,524 | 5,256 | 9,545 | 9,524 |
Recorded investment (loan balance): | ||||
Impaired loans individually evaluated for impairment | 8,354 | 8,520 | ||
Impaired loans collectively evaluated for impairment | 545 | 408 | ||
Non-impaired loans collectively evaluated for impairment | 830,832 | 797,099 | ||
Loans acquired with deteriorated credit quality | 3,358 | 4,857 | ||
Loans and Leases Receivable, Gross, Total | 843,089 | 810,884 | ||
Commercial | Commercial real estate | PCI loans | ||||
Recorded investment (loan balance): | ||||
Loans and Leases Receivable, Gross, Total | 3,358 | 4,857 | ||
Commercial real estate | Commercial real estate | ||||
Changes in allowance for loan losses : | ||||
Beginning balance | 4,723 | 5,044 | ||
Provision for loan losses | 1,945 | 507 | ||
Charge-offs | (58) | (160) | ||
Recoveries | 7 | |||
Recoveries | 94 | |||
Ending balance | 6,617 | 5,485 | ||
Allowance for loan losses: | ||||
Loans individually evaluated for impairment | 2,391 | 476 | ||
Loans collectively evaluated for impairment | 46 | 47 | ||
Non-impaired loans collectively evaluated for impairment | 3,375 | 3,356 | ||
Loans acquired with deteriorated credit quality | 805 | 844 | ||
Total | 4,723 | 5,044 | 6,617 | 4,723 |
Recorded investment (loan balance): | ||||
Impaired loans individually evaluated for impairment | 29,186 | 23,431 | ||
Impaired loans collectively evaluated for impairment | 425 | 437 | ||
Non-impaired loans collectively evaluated for impairment | 1,513,386 | 1,596,035 | ||
Loans acquired with deteriorated credit quality | 17,430 | 19,252 | ||
Loans and Leases Receivable, Gross, Total | 1,560,427 | 1,639,155 | ||
Commercial real estate | Commercial real estate | PCI loans | ||||
Recorded investment (loan balance): | ||||
Loans and Leases Receivable, Gross, Total | 17,430 | 19,252 | ||
Construction and land development | Commercial real estate | ||||
Changes in allowance for loan losses : | ||||
Beginning balance | 372 | 518 | ||
Provision for loan losses | 63 | (215) | ||
Charge-offs | (44) | |||
Recoveries | 7 | 25 | ||
Ending balance | 398 | 328 | ||
Allowance for loan losses: | ||||
Loans individually evaluated for impairment | 48 | |||
Loans collectively evaluated for impairment | 14 | 6 | ||
Non-impaired loans collectively evaluated for impairment | 384 | 318 | ||
Total | 372 | 518 | 398 | 372 |
Recorded investment (loan balance): | ||||
Impaired loans individually evaluated for impairment | 1,093 | 1,249 | ||
Impaired loans collectively evaluated for impairment | 125 | 58 | ||
Non-impaired loans collectively evaluated for impairment | 232,114 | 222,591 | ||
Loans acquired with deteriorated credit quality | 6,044 | 8,331 | ||
Loans and Leases Receivable, Gross, Total | 239,376 | 232,229 | ||
Construction and land development | Commercial real estate | PCI loans | ||||
Recorded investment (loan balance): | ||||
Loans and Leases Receivable, Gross, Total | 6,044 | 8,331 | ||
Residential real estate | Other loan portfolio | ||||
Changes in allowance for loan losses : | ||||
Beginning balance | 2,041 | 2,750 | ||
Provision for loan losses | 514 | (261) | ||
Charge-offs | (153) | (36) | ||
Recoveries | 22 | 51 | ||
Ending balance | 2,424 | 2,504 | ||
Allowance for loan losses: | ||||
Loans individually evaluated for impairment | 177 | 233 | ||
Loans collectively evaluated for impairment | 335 | 321 | ||
Non-impaired loans collectively evaluated for impairment | 1,481 | 1,051 | ||
Loans acquired with deteriorated credit quality | 431 | 436 | ||
Total | 2,041 | 2,750 | 2,424 | 2,041 |
Recorded investment (loan balance): | ||||
Impaired loans individually evaluated for impairment | 4,408 | 3,929 | ||
Impaired loans collectively evaluated for impairment | 3,345 | 3,341 | ||
Non-impaired loans collectively evaluated for impairment | 552,674 | 562,019 | ||
Loans acquired with deteriorated credit quality | 8,624 | 8,759 | ||
Loans and Leases Receivable, Gross, Total | 569,051 | 578,048 | ||
Residential real estate | Other loan portfolio | PCI loans | ||||
Recorded investment (loan balance): | ||||
Loans and Leases Receivable, Gross, Total | 8,624 | 8,759 | ||
Consumer | Other loan portfolio | ||||
Changes in allowance for loan losses : | ||||
Beginning balance | 2,154 | 1,344 | ||
Provision for loan losses | 329 | 304 | ||
Charge-offs | (556) | (434) | ||
Recoveries | 210 | 95 | ||
Ending balance | 2,137 | 1,309 | ||
Allowance for loan losses: | ||||
Loans collectively evaluated for impairment | 41 | 45 | ||
Non-impaired loans collectively evaluated for impairment | 1,898 | 1,926 | ||
Loans acquired with deteriorated credit quality | 198 | 183 | ||
Total | 2,154 | 1,344 | 2,137 | 2,154 |
Recorded investment (loan balance): | ||||
Impaired loans individually evaluated for impairment | 5 | |||
Impaired loans collectively evaluated for impairment | 533 | 564 | ||
Non-impaired loans collectively evaluated for impairment | 598,618 | 610,839 | ||
Loans acquired with deteriorated credit quality | 1,480 | 1,776 | ||
Loans and Leases Receivable, Gross, Total | 600,631 | 613,184 | ||
Consumer | Other loan portfolio | PCI loans | ||||
Recorded investment (loan balance): | ||||
Loans and Leases Receivable, Gross, Total | 1,480 | 1,776 | ||
Lease financing | Other loan portfolio | ||||
Changes in allowance for loan losses : | ||||
Beginning balance | 2,089 | 1,519 | ||
Provision for loan losses | 274 | 1,104 | ||
Charge-offs | (459) | (486) | ||
Recoveries | 66 | 39 | ||
Ending balance | 1,970 | 2,176 | ||
Allowance for loan losses: | ||||
Loans individually evaluated for impairment | 114 | 330 | ||
Loans collectively evaluated for impairment | 32 | 31 | ||
Non-impaired loans collectively evaluated for impairment | 1,824 | 1,728 | ||
Total | $ 2,089 | $ 1,519 | 1,970 | 2,089 |
Recorded investment (loan balance): | ||||
Impaired loans individually evaluated for impairment | 957 | 668 | ||
Impaired loans collectively evaluated for impairment | 291 | 289 | ||
Non-impaired loans collectively evaluated for impairment | 278,284 | 263,094 | ||
Loans and Leases Receivable, Gross, Total | $ 279,532 | $ 264,051 |
PREMISES AND EQUIPMENT, NET (De
PREMISES AND EQUIPMENT, NET (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Property, Plant and Equipment [Line Items] | |||
Premises and equipment gross | $ 127,394 | $ 126,230 | |
Accumulated depreciation | (32,880) | (31,390) | |
Premises and equipment, net | 94,514 | 94,840 | |
Depreciation | 1,601 | $ 1,454 | |
Land | |||
Property, Plant and Equipment [Line Items] | |||
Premises and equipment gross | 20,231 | 20,231 | |
Buildings and improvements | |||
Property, Plant and Equipment [Line Items] | |||
Premises and equipment gross | 77,290 | 76,141 | |
Furniture and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Premises and equipment gross | $ 29,873 | $ 29,858 |
MORTGAGE SERVICING RIGHTS (Deta
MORTGAGE SERVICING RIGHTS (Details) - USD ($) $ in Millions | Mar. 31, 2019 | Dec. 31, 2018 |
Commercial FHA Mortgage Loans | ||
MORTGAGE SERVICING RIGHTS | ||
Principal balances of loans serviced for others | $ 3,970 | $ 3,980 |
Residential mortgage loans | ||
MORTGAGE SERVICING RIGHTS | ||
Principal balances of loans serviced for others | $ 861.9 | $ 897.6 |
MORTGAGE SERVICING RIGHTS - Cha
MORTGAGE SERVICING RIGHTS - Changes in MSR (Details) - USD ($) | 3 Months Ended | |||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Mortgage servicing rights: | ||||
Balance, beginning of period | $ 56,252,000 | $ 55,714,000 | ||
Balance, end of period | 55,787,000 | 56,039,000 | ||
Valuation allowances: | ||||
Balance, beginning of period | 2,805,000 | 3,254,000 | ||
Additions | 25,000 | 133,000 | ||
Balance, end of period | 2,830,000 | 3,387,000 | ||
Mortgage servicing rights, net | 52,957,000 | 52,652,000 | ||
Fair Value | 52,957,000 | 52,652,000 | $ 53,447,000 | $ 52,460,000 |
Mortgage servicing rights held for sale | 257,000 | $ 3,545,000 | ||
Commercial FHA Mortgage Loans | ||||
Mortgage servicing rights: | ||||
Originated servicing | 213,000 | 1,001,000 | ||
Amortization | (678,000) | (676,000) | ||
Residential mortgage loans | ||||
Valuation allowances: | ||||
Sale of mortgage servicing rights held for sale | 3,300,000 | $ 10,200,000 | ||
Mortgage servicing rights held for sale | $ 257,000 |
MORTGAGE SERVICING RIGHTS - Sum
MORTGAGE SERVICING RIGHTS - Summary of key assumptions (Details) - Commercial FHA Mortgage Loans - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2019 | Dec. 31, 2018 | |
Assumptions Used to Estimate Fair Value | ||
Servicing Fee | 0.13% | 0.13% |
Interest Rate | 3.67% | 3.67% |
Remaining Years to Maturity | 30 years | 30 years 1 month 6 days |
Prepayment Rate | 8.21% | 8.24% |
Servicing Cost | $ 1,000 | $ 1,000 |
Maximum | ||
Assumptions Used to Estimate Fair Value | ||
Discount Rate | 14.00% | 14.00% |
Minimum | ||
Assumptions Used to Estimate Fair Value | ||
Discount Rate | 10.00% | 10.00% |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Goodwill [Line Items] | ||
Goodwill | $ 164,673 | $ 164,673 |
Banking | ||
Goodwill [Line Items] | ||
Goodwill | 149,035 | |
Commercial FHA origination and servicing | ||
Goodwill [Line Items] | ||
Goodwill | 10,892 | |
Wealth management | ||
Goodwill [Line Items] | ||
Goodwill | $ 4,746 |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS - Intangible assets (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Finite-lived intangible assets | |||
Gross Carrying Amount | $ 66,483 | $ 66,483 | |
Accumulated Amortization | (30,917) | (29,107) | |
Total | 35,566 | 37,376 | |
Amortization of intangible assets | 1,810 | $ 1,675 | |
Core deposits | |||
Finite-lived intangible assets | |||
Gross Carrying Amount | 52,712 | 52,712 | |
Accumulated Amortization | (26,309) | (24,803) | |
Total | 26,403 | 27,909 | |
Customer relationship | |||
Finite-lived intangible assets | |||
Gross Carrying Amount | 13,771 | 13,771 | |
Accumulated Amortization | (4,608) | (4,304) | |
Total | $ 9,163 | $ 9,467 |
DERIVATIVE INSTRUMENTS (Details
DERIVATIVE INSTRUMENTS (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Fair value of the Company's derivative financial instruments as well as their classification on the consolidated statements of condition | |||
Notional amount, asset derivatives | $ 549,558,000 | $ 541,581,000 | |
Fair value of asset derivatives | 5,752,000 | 4,492,000 | |
Net gains (losses) recognized on derivative instruments | 1,300,000 | $ 74,000 | |
Interest rate lock commitments | |||
Fair value of the Company's derivative financial instruments as well as their classification on the consolidated statements of condition | |||
Notional amount, asset derivatives | 275,324,000 | 264,710,000 | |
Fair value of asset derivatives | 5,752,000 | 4,492,000 | |
Forward commitments to sell mortgage-backed securities | |||
Fair value of the Company's derivative financial instruments as well as their classification on the consolidated statements of condition | |||
Notional amount, asset derivatives | 274,234,000 | 276,871,000 | |
Notional amount, liability derivatives | 67,000 | 54,000 | |
Interest rate swap contracts | |||
Fair value of the Company's derivative financial instruments as well as their classification on the consolidated statements of condition | |||
Notional amount of interest rate swaps | 9,400,000 | 9,500,000 | |
Interest rate swap contracts | Other assets | |||
Fair value of the Company's derivative financial instruments as well as their classification on the consolidated statements of condition | |||
Fair value of asset derivatives | $ 18,000 | $ 145,000 |
DERIVATIVE INSTRUMENTS - Intere
DERIVATIVE INSTRUMENTS - Interest Rate Swap Agreements (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Derivative disclosures | ||
Fair value of asset derivatives | $ 5,752,000 | $ 4,492,000 |
Interest rate swap contracts | ||
Derivative disclosures | ||
Notional amount of interest rate swaps | 9,400,000 | 9,500,000 |
Interest rate swap contracts | Other assets | ||
Derivative disclosures | ||
Fair value of asset derivatives | $ 18,000 | $ 145,000 |
DEPOSITS (Details)
DEPOSITS (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Classification of deposits | ||
Noninterest-bearing demand | $ 941,344 | $ 972,164 |
Interest-bearing: | ||
Checking | 968,844 | 1,002,275 |
Money market | 802,036 | 862,171 |
Savings | 457,176 | 442,132 |
Time | 866,888 | 795,428 |
Total deposits | $ 4,036,288 | $ 4,074,170 |
SHORT-TERM BORROWINGS (Details)
SHORT-TERM BORROWINGS (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2019 | Dec. 31, 2018 | |
Short-term Debt [Line Items] | ||
Outstanding at period-end | $ 115,832 | $ 124,235 |
Average amount outstanding | 135,337 | 138,135 |
Maximum amount outstanding at any month end | $ 138,907 | $ 173,387 |
Weighted average interest rate: | ||
During period | 0.71% | 0.51% |
End of period | 0.73% | 0.71% |
Short-Term Borrowings | ||
Investment securities pledged/collateralized for secured borrowings | $ 123,400 | $ 132,200 |
Line of credit | 0 | 0 |
Federal funds lines of credit | 45,000 | |
Commercial real estate | ||
Short-Term Borrowings | ||
Loans and Leases Receivable, Gross, Carrying Amount, Commercial | 59,400 | 67,600 |
Federal Reserve Discount Window | ||
Short-Term Borrowings | ||
Line of credit | $ 50,000 | $ 56,800 |
FHLB ADVANCES AND OTHER BORRO_3
FHLB ADVANCES AND OTHER BORROWINGS (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended |
May 31, 2017 | Mar. 31, 2019 | Dec. 31, 2018 | |
FHLB ADVANCES AND OTHER BORROWINGS | |||
Total FHLB advances and other borrowings | $ 669,009 | $ 640,631 | |
Federal Home Loan Bank Advances, Interest Rate Information | |||
Preferred stock, shares issued | 2,636 | 2,636 | |
Preferred stock, par value | $ 2 | $ 2 | |
Line of Credit Facility, Maximum Borrowing Capacity | $ 45,000 | ||
FHLB advances, collateral for mortgage and home equity line of credit loans | 2,110,000 | $ 2,220,000 | |
Revolving Credit Facility [Member] | Maximum | |||
Federal Home Loan Bank Advances, Interest Rate Information | |||
Line of Credit Facility, Maximum Borrowing Capacity | $ 10,000 | ||
Term loan | |||
Federal Home Loan Bank Advances, Interest Rate Information | |||
Face Amount | $ 40,000 | ||
Principal payment on term loan | $ 1,400 | ||
LIBOR | Term loan | |||
Federal Home Loan Bank Advances, Interest Rate Information | |||
Basis spread on variable rate | 2.25% | ||
Variable rate basis | one-month LIBOR | ||
Series G Preferred Stock | |||
Federal Home Loan Bank Advances, Interest Rate Information | |||
Preferred stock, shares issued | 181 | ||
Preferred stock, par value | $ 1,000 | ||
Midland States Bancorp, Inc | Term loan | |||
FHLB ADVANCES AND OTHER BORROWINGS | |||
Long term debt | $ 31,414 | $ 32,840 | |
Midland States Bancorp, Inc | LIBOR | Term loan | |||
Federal Home Loan Bank Advances, Interest Rate Information | |||
Basis spread on variable rate | 2.25% | ||
Interest rate during the period | 4.75% | 4.63% | |
Midland States Bancorp, Inc | Series G Preferred Stock | |||
FHLB ADVANCES AND OTHER BORROWINGS | |||
Long term debt | $ 181 | $ 181 | |
Midland States Bank | Fixed Rate Term Loan | |||
FHLB ADVANCES AND OTHER BORROWINGS | |||
Total FHLB advances and other borrowings | 627,414 | 607,610 | |
Midland States Bank | Fixed rate, fixed term maturing through February 2023 | |||
FHLB ADVANCES AND OTHER BORROWINGS | |||
Total FHLB advances and other borrowings | $ 62,500 | $ 87,700 | |
Federal Home Loan Bank Advances, Interest Rate Information | |||
FHLB advances interest rate | 2.50% | 2.35% | |
Midland States Bank | Putable fixed rate loan maturing through August 2025 | |||
FHLB ADVANCES AND OTHER BORROWINGS | |||
Total FHLB advances and other borrowings | $ 565,000 | $ 520,000 | |
Federal Home Loan Bank Advances, Interest Rate Information | |||
FHLB advances interest rate | 2.11% | 2.09% | |
Midland States Bank | Variable rate, fixed term maturing through March 2018 | |||
FHLB ADVANCES AND OTHER BORROWINGS | |||
Total FHLB advances and other borrowings | $ 10,000 | ||
Midland States Bank | Fixed Rate Fixed Term Loan Maturing Through June 2019 | |||
Federal Home Loan Bank Advances, Interest Rate Information | |||
FHLB advances interest rate | 2.60% |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - shares | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Stock option | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share | 97,628 | 31,259 |
EARNINGS PER SHARE (Details 2)
EARNINGS PER SHARE (Details 2) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Net income | $ 13,982 | $ 1,806 |
Preferred dividends declared | (82) | (83) |
Preferred stock, premium amortization | 48 | 47 |
Net income available to common shareholders | 13,948 | 1,770 |
Common shareholder dividends | (5,776) | (4,208) |
Unvested restricted stock award dividends | (47) | (31) |
Undistributed earnings to unvested restricted stock awards | (65) | |
Undistributed earnings to common shareholders | 8,060 | (2,469) |
Basic | ||
Common shareholder dividends | (5,776) | (4,208) |
Undistributed earnings to common shareholders | 8,060 | (2,469) |
Net income available to common shareholders | 13,836 | 1,739 |
Diluted | ||
Common shareholder dividends | (5,776) | (4,208) |
Undistributed earnings to common shareholders | 8,060 | (2,469) |
Net income available to common shareholders | 13,836 | 1,739 |
Add back: | ||
Total common shareholders earnings, diluted | $ 13,836 | $ 1,739 |
Weighted average common shares outstanding, basic (In shares) | 23,998,119 | 20,901,738 |
Weighted average common shares outstanding, diluted (In shares) | 24,204,661 | 21,351,511 |
Basic earnings per common share (In dollars per share) | $ 0.58 | $ 0.08 |
Diluted earnings per common share (In dollars per share) | $ 0.57 | $ 0.08 |
Options and warrants | ||
Add back: | ||
Options and warrants | 206,542 | 449,773 |
FAIR VALUE OF FINANCIAL INSTR_3
FAIR VALUE OF FINANCIAL INSTRUMENTS - Recurring and Nonrecurring basis (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Assets | |||
Investment securities available for sale | $ 652,739 | ||
Equity securities | 3,413 | $ 3,334 | |
Loans held for sale | 16,851 | 30,401 | |
Assets measured at fair value on a non-recurring basis: | |||
Mortgage servicing rights held for sale | 257 | 3,545 | |
Losses recognized on assets measured on non-recurring basis | |||
Mortgage servicing rights | 25 | $ 133 | |
Impaired loans | 981 | 875 | |
Other real estate owned | 16 | ||
Total loss on assets measured on a nonrecurring basis | 1,022 | $ 1,008 | |
U.S. Treasury securities | |||
Assets | |||
Investment securities available for sale | 24,768 | 24,650 | |
Government sponsored entity debt securities | |||
Assets | |||
Investment securities available for sale | 75,587 | 75,684 | |
State and municipal securities | |||
Assets | |||
Investment securities available for sale | 150,912 | 159,262 | |
Corporate Securities | |||
Assets | |||
Investment securities available for sale | 80,021 | 71,550 | |
Equity Security | |||
Assets | |||
Investment securities available for sale | 657,451 | ||
Level 1 | |||
Assets | |||
Investment securities available for sale | 24,768 | 24,650 | |
Level 2 | |||
Assets | |||
Investment securities available for sale | 626,041 | 634,212 | |
Equity securities | 3,413 | ||
Loans held for sale | 16,851 | 30,401 | |
Level 2 | Interest rate lock commitments | |||
Assets | |||
Derivative Assets | 5,752 | 4,492 | |
Level 2 | Interest rate swap contracts | |||
Assets | |||
Derivative Assets | 18 | 145 | |
Liabilities | |||
Derivative liability | 18 | 145 | |
Level 3 | |||
Assets | |||
Investment securities available for sale | 1,930 | 1,923 | |
Assets measured at fair value on a non-recurring basis: | |||
Mortgage servicing rights | 53,000 | 53,400 | |
Recurring member | |||
Assets | |||
Loans held for sale | 16,851 | 30,401 | |
Total Assets | 678,773 | 695,823 | |
Recurring member | U.S. Treasury securities | |||
Assets | |||
Investment securities available for sale | 24,768 | 24,650 | |
Recurring member | Government sponsored entity debt securities | |||
Assets | |||
Investment securities available for sale | 75,587 | 75,684 | |
Recurring member | Agency mortgage-backed securities | |||
Assets | |||
Investment securities available for sale | 321,451 | 326,305 | |
Recurring member | State and municipal securities | |||
Assets | |||
Investment securities available for sale | 150,912 | 159,262 | |
Recurring member | Corporate Securities | |||
Assets | |||
Investment securities available for sale | 80,021 | 71,550 | |
Recurring member | Equity Security | |||
Assets | |||
Equity securities | 3,413 | 3,334 | |
Recurring member | Interest rate lock commitments | |||
Assets | |||
Derivative Assets | 5,752 | 4,492 | |
Recurring member | Interest rate swap contracts | |||
Assets | |||
Derivative Assets | 18 | 145 | |
Liabilities | |||
Derivative liability | 18 | 145 | |
Recurring member | Level 1 | |||
Assets | |||
Total Assets | 24,768 | 24,650 | |
Recurring member | Level 1 | U.S. Treasury securities | |||
Assets | |||
Investment securities available for sale | 24,768 | 24,650 | |
Recurring member | Level 2 | |||
Assets | |||
Loans held for sale | 16,851 | 30,401 | |
Total Assets | 652,075 | 669,250 | |
Recurring member | Level 2 | Government sponsored entity debt securities | |||
Assets | |||
Investment securities available for sale | 75,587 | 75,684 | |
Recurring member | Level 2 | Agency mortgage-backed securities | |||
Assets | |||
Investment securities available for sale | 321,451 | 326,305 | |
Recurring member | Level 2 | State and municipal securities | |||
Assets | |||
Investment securities available for sale | 150,912 | 159,262 | |
Recurring member | Level 2 | Corporate Securities | |||
Assets | |||
Investment securities available for sale | 78,091 | 69,627 | |
Recurring member | Level 2 | Equity Security | |||
Assets | |||
Equity securities | 3,413 | 3,334 | |
Recurring member | Level 2 | Interest rate lock commitments | |||
Assets | |||
Derivative Assets | 5,752 | 4,492 | |
Recurring member | Level 2 | Interest rate swap contracts | |||
Assets | |||
Derivative Assets | 18 | 145 | |
Liabilities | |||
Derivative liability | 18 | 145 | |
Recurring member | Level 3 | |||
Assets | |||
Total Assets | 1,930 | 1,923 | |
Recurring member | Level 3 | Corporate Securities | |||
Assets | |||
Investment securities available for sale | 1,930 | 1,923 | |
Non recurring member | |||
Assets measured at fair value on a non-recurring basis: | |||
Mortgage servicing rights | 52,957 | 53,447 | |
Mortgage servicing rights held for sale | 257 | 3,545 | |
Impaired loans | 6,734 | 11,238 | |
Other real estate owned | 47 | 1,439 | |
Assets held for sale | 1,687 | 1,687 | |
Non recurring member | Level 1 | |||
Assets measured at fair value on a non-recurring basis: | |||
Mortgage servicing rights held for sale | 257 | 3,545 | |
Non recurring member | Level 2 | |||
Assets measured at fair value on a non-recurring basis: | |||
Impaired loans | 4,639 | 9,226 | |
Other real estate owned | 47 | 1,439 | |
Assets held for sale | 1,687 | 1,687 | |
Non recurring member | Level 3 | |||
Assets measured at fair value on a non-recurring basis: | |||
Mortgage servicing rights | 52,957 | 53,447 | |
Impaired loans | $ 2,095 | $ 2,012 |
FAIR VALUE OF FINANCIAL INSTR_4
FAIR VALUE OF FINANCIAL INSTRUMENTS- Unobservable inputs (Level 3) (Details) - Corporate Securities - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Beginning balance | $ 1,923 | $ 4,779 |
Total realized in earnings | 22 | 187 |
Total unrealized in other comprehensive income | 7 | 616 |
Net settlements (principal and interest) | (22) | (162) |
Ending balance | $ 1,930 | $ 5,420 |
FAIR VALUE OF FINANCIAL INSTR_5
FAIR VALUE OF FINANCIAL INSTRUMENTS- Quantitative Information (Details) $ in Thousands | Mar. 31, 2019USD ($)item | Dec. 31, 2018USD ($)item |
Non recurring member | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage servicing rights | $ 52,957 | $ 53,447 |
Impaired loans | 6,734 | 11,238 |
Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage servicing rights | 53,000 | 53,400 |
Level 3 | Non recurring member | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage servicing rights | 52,957 | 53,447 |
Impaired loans | $ 2,095 | $ 2,012 |
Level 3 | Non recurring member | Mortgage servicing rights | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Valuation technique for servicing asset | us-gaap:ValuationTechniqueDiscountedCashFlowMember | us-gaap:ValuationTechniqueDiscountedCashFlowMember |
Level 3 | Non recurring member | Discounted cash flow | Mortgage servicing rights | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage servicing rights | $ 52,957 | $ 53,447 |
Level 3 | Non recurring member | Fair value of collateral | Impaired loans | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Impaired loans | $ 2,095 | $ 2,012 |
Minimum | Level 3 | Non recurring member | Measurement Input, Discount Rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input for servicing asset | item | 0.10 | 0.10 |
Minimum | Level 3 | Non recurring member | Measurement Input, Prepayment Rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input for servicing asset | item | 0.08 | 0.08 |
Minimum | Level 3 | Non recurring member | Measurement Input Discount Rate For Type Of Property Age Of Appraisal And Current Status [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input for impaired loans | 0.0432 | 0.05 |
Maximum | Level 3 | Non recurring member | Measurement Input, Discount Rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input for servicing asset | item | 0.12 | 0.27 |
Maximum | Level 3 | Non recurring member | Measurement Input, Prepayment Rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input for servicing asset | item | 0.18 | 0.18 |
Maximum | Level 3 | Non recurring member | Measurement Input Discount Rate For Type Of Property Age Of Appraisal And Current Status [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input for impaired loans | 0.0733 | 0.0726 |
Weighted average | Level 3 | Non recurring member | Measurement Input, Discount Rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input for servicing asset | item | 0.1112 | 0.1112 |
Weighted average | Level 3 | Non recurring member | Measurement Input, Prepayment Rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input for servicing asset | item | 0.0821 | 0.0824 |
Weighted average | Level 3 | Non recurring member | Measurement Input Discount Rate For Type Of Property Age Of Appraisal And Current Status [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input for impaired loans | 0.0549 | 0.0526 |
FAIR VALUE OF FINANCIAL INSTR_6
FAIR VALUE OF FINANCIAL INSTRUMENTS- Fair value option and gains and losses from fair value changes (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Aggregate fair value | $ 16,851 | $ 30,401 | |
Difference | 589 | 1,079 | |
Contractual principal | 16,262 | 29,322 | |
Gains and losses from fair value changes | |||
Gains and losses from fair value changes of loan held for sales | (385) | $ (343) | |
Residential loans held for sale | |||
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Aggregate fair value | 5,896 | 8,121 | |
Difference | 322 | 484 | |
Contractual principal | 5,574 | 7,637 | |
Gains and losses from fair value changes | |||
Gains and losses from fair value changes of loan held for sales | (57) | (108) | |
Commercial real estate | |||
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Aggregate fair value | 10,955 | 22,280 | |
Difference | 267 | 595 | |
Contractual principal | 10,688 | $ 21,685 | |
Gains and losses from fair value changes | |||
Gains and losses from fair value changes of loan held for sales | $ (328) | $ (235) |
FAIR VALUE OF FINANCIAL INSTR_7
FAIR VALUE OF FINANCIAL INSTRUMENTS- Carrying values and fair value (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Assets | ||
Investment securities available for sale | $ 652,739 | |
Equity securities | 3,413 | $ 3,334 |
Loans held for sale | 16,851 | 30,401 |
Accrued interest receivable | 16,669 | 16,560 |
Liabilities | ||
Trust preferred debentures | 47,918 | 47,794 |
Accrued interest payable | 6,254 | 4,855 |
Level 1 | ||
Assets | ||
Cash and due from banks | 275,939 | 210,780 |
Federal funds sold | 541 | 2,920 |
Investment securities available for sale | 24,768 | 24,650 |
Level 2 | ||
Assets | ||
Investment securities available for sale | 626,041 | 634,212 |
Equity securities | 3,413 | |
Nonmarketable equity securities | 46,009 | 42,472 |
Loans held for sale | 16,851 | 30,401 |
Accrued interest receivable | 5,070 | 16,560 |
Liabilities | ||
Deposits | 4,034,453 | 4,069,098 |
Short-term borrowings | 115,832 | 124,235 |
FHLB and other borrowings | 674,353 | 641,050 |
Subordinated debt | 95,526 | 91,926 |
Trust preferred debentures | 56,018 | 56,805 |
Accrued interest payable | 6,254 | 4,855 |
Level 3 | ||
Assets | ||
Investment securities available for sale | 1,930 | 1,923 |
Loans, net | 4,061,017 | 4,091,438 |
Carrying value | ||
Assets | ||
Cash and due from banks | 275,939 | 210,780 |
Federal funds sold | 541 | 2,920 |
Investment securities available for sale | 652,739 | 660,785 |
Equity securities | 3,413 | |
Nonmarketable equity securities | 46,009 | 42,472 |
Loans, net | 4,069,015 | 4,116,648 |
Loans held for sale | 16,851 | 30,401 |
Accrued interest receivable | 5,070 | 16,560 |
Liabilities | ||
Deposits | 4,036,288 | 4,074,170 |
Short-term borrowings | 115,832 | 124,235 |
FHLB and other borrowings | 669,009 | 640,631 |
Subordinated debt | 94,174 | 94,134 |
Trust preferred debentures | 47,918 | 47,794 |
Accrued interest payable | 6,254 | 4,855 |
Fair value | ||
Assets | ||
Cash and due from banks | 275,939 | 210,780 |
Federal funds sold | 541 | 2,920 |
Investment securities available for sale | 652,739 | 660,785 |
Equity securities | 3,413 | |
Nonmarketable equity securities | 46,009 | 42,472 |
Loans, net | 4,061,017 | 4,091,438 |
Loans held for sale | 16,851 | 30,401 |
Accrued interest receivable | 5,070 | 16,560 |
Liabilities | ||
Deposits | 4,034,453 | 4,069,098 |
Short-term borrowings | 115,832 | 124,235 |
FHLB and other borrowings | 674,353 | 641,050 |
Subordinated debt | 95,526 | 91,926 |
Trust preferred debentures | 56,018 | 56,805 |
Accrued interest payable | 6,254 | 4,855 |
Interest rate lock commitments | Level 2 | ||
Assets | ||
Derivative Assets | 5,752 | 4,492 |
Interest rate lock commitments | Carrying value | ||
Assets | ||
Derivative Assets | 5,752 | 4,492 |
Interest rate lock commitments | Fair value | ||
Assets | ||
Derivative Assets | 5,752 | 4,492 |
Interest rate swap contracts | Level 2 | ||
Assets | ||
Derivative Assets | 18 | 145 |
Liabilities | ||
Derivative Liability | 18 | 145 |
Interest rate swap contracts | Carrying value | ||
Assets | ||
Derivative Assets | 18 | 145 |
Liabilities | ||
Derivative Liability | 18 | 145 |
Interest rate swap contracts | Fair value | ||
Assets | ||
Derivative Assets | 18 | 145 |
Liabilities | ||
Derivative Liability | 18 | 145 |
Corporate Securities | ||
Assets | ||
Investment securities available for sale | $ 80,021 | $ 71,550 |
COMMITMENTS, CONTINGENCIES AN_3
COMMITMENTS, CONTINGENCIES AND CREDIT RISK - Maturities (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2019 | Dec. 31, 2018 | |
Anticipated material loss | $ 0 | ||
Losses as a result of make whole requests and loan repurchases | $ 20,000 | ||
Liability for unresolved repurchase demands | 289,000 | $ 492,000 | |
Commitments to extend credit | |||
Loan commitments | 670,694,000 | 663,555,000 | |
Financial guarantees - standby letters of credit | |||
Loan commitments | $ 140,183,000 | $ 142,859,000 |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Segment Reporting Information [Line Items] | |||
Net interest income (expense) | $ 45,601 | $ 38,185 | |
Provision for loan losses | 3,243 | 2,006 | |
Noninterest income | 17,075 | 16,502 | |
Noninterest expense | 41,097 | 49,499 | |
Income (loss) before income taxes (benefit) | 18,336 | 3,182 | |
Income taxes (benefit) | 4,354 | 1,376 | |
Net income (loss) | 13,982 | 1,806 | |
Total assets | 5,641,780 | 5,723,372 | $ 5,637,673 |
Banking | |||
Segment Reporting Information [Line Items] | |||
Net interest income (expense) | 48,518 | 40,631 | |
Provision for loan losses | 3,243 | 2,006 | |
Noninterest income | 8,940 | 9,016 | |
Noninterest expense | 35,371 | 44,366 | |
Income (loss) before income taxes (benefit) | 18,844 | 3,275 | |
Income taxes (benefit) | 4,975 | 1,379 | |
Net income (loss) | 13,869 | 1,896 | |
Total assets | 5,582,494 | 5,671,231 | |
Commercial FHA origination and servicing | |||
Segment Reporting Information [Line Items] | |||
Net interest income (expense) | (176) | 37 | |
Noninterest income | 3,238 | 3,521 | |
Noninterest expense | 2,811 | 3,538 | |
Income (loss) before income taxes (benefit) | 251 | 20 | |
Income taxes (benefit) | 71 | 407 | |
Net income (loss) | 180 | (387) | |
Total assets | 94,797 | 91,580 | |
Wealth management | |||
Segment Reporting Information [Line Items] | |||
Net interest income (expense) | 85 | ||
Noninterest income | 4,953 | 4,080 | |
Noninterest expense | 3,247 | 2,386 | |
Income (loss) before income taxes (benefit) | 1,706 | 1,779 | |
Income taxes (benefit) | 140 | 141 | |
Net income (loss) | 1,566 | 1,638 | |
Total assets | 19,039 | 16,573 | |
Other | |||
Segment Reporting Information [Line Items] | |||
Net interest income (expense) | (2,741) | (2,568) | |
Noninterest income | (56) | (115) | |
Noninterest expense | (332) | (791) | |
Income (loss) before income taxes (benefit) | (2,465) | (1,892) | |
Income taxes (benefit) | (832) | (551) | |
Net income (loss) | (1,633) | (1,341) | |
Total assets | $ (54,550) | $ (56,012) |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Chairman | |
Related Party Transaction [Line Items] | |
Payments to related party | $ 210,000 |
LEASES (Details)
LEASES (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
LEASES | |
Options to extend the leases | true |
Renewal term of lease | 5 years |
Operating lease cost | $ 708 |
Operating cash flows from leases | 741 |
Right-of-use assets obtained in exchange for lease obligations | $ 10,677 |
Weighted average remaining lease term | 6 years |
Weighted average discount rate | 3.12% |
Projected minimum rental payments | |
2019 remaining | $ 2,482 |
2020 | 2,288 |
2021 | 2,160 |
2022 | 2,060 |
2023 | 1,292 |
Thereafter | 2,057 |
Total future minimum lease payments | 12,339 |
Less imputed interest | (1,141) |
Total operating lease liabilities | $ 11,198 |
Minimum | |
LEASES | |
Remaining lease terms | 2 months |
Maximum | |
LEASES | |
Remaining lease terms | 13 years |
REVENUE FROM CONTRACT WITH CU_3
REVENUE FROM CONTRACT WITH CUSTOMERS (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Disaggregation of Revenue [Line Items] | ||
Noninterest income - out-of-scope of Topic 606 | $ 5,729 | |
Total noninterest income | $ 17,075 | $ 16,502 |
Contract Acquisition Costs | ||
Practical expedient, amortization period | 1 year | |
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Noninterest income - out-of-scope of Topic 606 | 7,003 | |
Total noninterest income | 16,502 | |
Trust management/administration fees | ||
Disaggregation of Revenue [Line Items] | ||
Noninterest income - in-scope of Topic 606 | $ 3,617 | |
Trust management/administration fees | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Noninterest income - in-scope of Topic 606 | 3,119 | |
Investment advisory fees | ||
Disaggregation of Revenue [Line Items] | ||
Noninterest income - in-scope of Topic 606 | 529 | |
Investment advisory fees | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Noninterest income - in-scope of Topic 606 | 465 | |
Investment brokerage fees | ||
Disaggregation of Revenue [Line Items] | ||
Noninterest income - in-scope of Topic 606 | 219 | |
Investment brokerage fees | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Noninterest income - in-scope of Topic 606 | 264 | |
Other | ||
Disaggregation of Revenue [Line Items] | ||
Noninterest income - in-scope of Topic 606 | 588 | |
Other | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Noninterest income - in-scope of Topic 606 | 231 | |
Nonsufficient fund fees | ||
Disaggregation of Revenue [Line Items] | ||
Noninterest income - in-scope of Topic 606 | 1,754 | |
Nonsufficient fund fees | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Noninterest income - in-scope of Topic 606 | 1,450 | |
Other | ||
Disaggregation of Revenue [Line Items] | ||
Noninterest income - in-scope of Topic 606 | 766 | |
Other | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Noninterest income - in-scope of Topic 606 | 517 | |
Interchange revenues | ||
Disaggregation of Revenue [Line Items] | ||
Noninterest income - in-scope of Topic 606 | 2,680 | |
Interchange revenues | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Noninterest income - in-scope of Topic 606 | 2,045 | |
Merchant services revenue | ||
Disaggregation of Revenue [Line Items] | ||
Noninterest income - in-scope of Topic 606 | 375 | |
Merchant services revenue | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Noninterest income - in-scope of Topic 606 | 338 | |
Other | ||
Disaggregation of Revenue [Line Items] | ||
Noninterest income - in-scope of Topic 606 | $ 818 | |
Other | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Noninterest income - in-scope of Topic 606 | $ 1,070 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) $ in Thousands | Apr. 02, 2019USD ($)shares | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($)item | Mar. 31, 2018USD ($) |
Subsequent Event [Line Items] | ||||
Total assets | $ 5,641,780 | $ 5,637,673 | $ 5,723,372 | |
Loans | 4,092,106 | 4,137,551 | ||
Total deposits | $ 4,036,288 | $ 4,074,170 | ||
HomeStar Financial Group, Inc. | ||||
Subsequent Event [Line Items] | ||||
Number of banking centers | item | 5 | |||
Total assets | $ 375,400 | |||
Loans | 222,700 | |||
Total deposits | $ 333,100 | |||
Subsequent Events | Minimum | HomeStar Financial Group, Inc. | ||||
Subsequent Event [Line Items] | ||||
Adjusted shareholders equity | $ 10,400 | |||
Subsequent Events | HomeStar Financial Group, Inc. | ||||
Subsequent Event [Line Items] | ||||
Total consideration | $ 9,900 | |||
Shares issued | shares | 405,000 | |||
Cash to pay outstanding trust preferred securities and subordinated debentures plus accrued interest | $ 23,500 |