Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Mar. 11, 2020 | Jun. 28, 2019 | |
Document and Entity Information | |||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2019 | ||
Entity Registrant Name | Bank First Corp | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | true | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 7,085,107 | ||
Entity Central Index Key | 0001746109 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Public Float | $ 453,492,752 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Assets | ||
Cash and due from banks | $ 33,817 | $ 41,435 |
Interest-bearing deposits | 19,242 | 21,830 |
Federal funds sold | 33,393 | 44,478 |
Cash and cash equivalents | 86,452 | 107,743 |
Securities held to maturity, at amortized cost ($44,803 and $40,477 fair value at December 31, 2019 and 2018, respectively) | 43,734 | 40,768 |
Securities available for sale, at fair value | 181,506 | 118,906 |
Loans held for sale | 587 | 0 |
Loans, net | 1,724,947 | 1,416,246 |
Premises and equipment, net | 35,286 | 24,489 |
Goodwill | 43,456 | 15,024 |
Other investments | 4,933 | 4,555 |
Cash value of life insurance | 24,945 | 24,178 |
Identifiable intangible assets, net | 9,666 | 5,297 |
Other real estate owned ("OREO") | 6,888 | 3,592 |
Investment in minority-owned subsidiaries | 40,287 | 25,397 |
Other assets | 7,481 | 6,970 |
TOTAL ASSETS | 2,210,168 | 1,793,165 |
Deposits: | ||
Interest-bearing deposits | 1,366,846 | 1,108,402 |
Noninterest-bearing deposits | 476,465 | 448,765 |
Total deposits | 1,843,311 | 1,557,167 |
Securities sold under repurchase agreements | 45,865 | 31,489 |
Notes payable | 49,790 | 0 |
Subordinated notes | 18,622 | 11,500 |
Other liabilities | 22,369 | 18,686 |
Total liabilities | 1,979,957 | 1,618,842 |
Stockholders' equity: | ||
Serial preferred stock - $0.01 par value Authorized - 5,000,000 shares | 0 | 0 |
Common stock - $0.01 par valueAuthorized - 20,000,000 shares Issued - 7,902,742 and 7,368,083 shares as of December 31, 2019 and 2018, respectively | 79 | 74 |
Additional paid-in capital | 63,085 | 27,601 |
Retained earnings | 189,494 | 168,363 |
Treasury stock, at cost - 818,014 and 757,725 shares as of December 31, 2019 and 2018, respectively | (24,941) | (21,349) |
Accumulated other comprehensive income (loss) | 2,494 | (366) |
Total stockholders' equity | 230,211 | 174,323 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 2,210,168 | $ 1,793,165 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Debt Securities, Held-to-maturity, Fair Value | $ 44,803 | $ 40,477 |
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized | 20,000,000 | 20,000,000 |
Common Stock, Shares, Issued | 7,902,742 | 7,368,083 |
Common Stock, Shares, Outstanding | 7,084,728 | 6,610,358 |
Treasury Stock, Shares | 818,014 | 757,725 |
Series A Preferred Stock [Member] | ||
Preferred Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Preferred Stock, Shares Authorized | 5,000,000 | 5,000,000 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Interest income: | |||
Loans, including fees | $ 82,939 | $ 72,101 | $ 48,863 |
Securities: | |||
Taxable | 3,134 | 2,915 | 1,833 |
Tax-exempt | 1,662 | 1,776 | 1,664 |
Other | 1,430 | 1,152 | 1,112 |
Total interest income | 89,165 | 77,944 | 53,472 |
Interest expense: | |||
Deposits | 17,875 | 12,382 | 6,443 |
Securities sold under repurchase agreements | 461 | 399 | 272 |
Borrowed funds | 1,162 | 2,064 | 1,017 |
Total interest expense | 19,498 | 14,845 | 7,732 |
Net interest income | 69,667 | 63,099 | 45,740 |
Provision for loan losses | 5,250 | 2,935 | 1,055 |
Net interest income after provision for loan losses | 64,417 | 60,164 | 44,685 |
Noninterest expense: | |||
Service charges | 3,506 | 3,493 | 2,950 |
Income from Ansay and Associates, LLC ("Ansay") | 1,792 | 2,114 | 1,663 |
Income from UFS, LLC ("UFS") | 2,935 | 2,563 | 2,390 |
Loan servicing income | 550 | 1,478 | 1,158 |
Net gain on sales of mortgage loans | 1,401 | 617 | 895 |
Net gain (loss) on sales of securities | 634 | (31) | (32) |
Net gain on sale of other investments | 234 | ||
Noninterest income from strategic alliances | 95 | 90 | 94 |
Other | 1,485 | 1,176 | 698 |
Total noninterest expense | 12,632 | 11,500 | 9,816 |
Noninterest expense: | |||
Salaries, commissions, and employee benefits | 22,903 | 21,500 | 16,595 |
Occupancy | 3,860 | 3,498 | 3,097 |
Data processing | 4,509 | 3,619 | 2,939 |
Postage, stationery, and supplies | 591 | 620 | 452 |
Net (gain) loss on sales and valuations of OREO | (73) | 252 | (49) |
Advertising | 268 | 220 | 183 |
Charitable contributions | 566 | 985 | 495 |
Outside service fees | 3,041 | 3,132 | 3,317 |
Amortization of intangibles | 1,069 | 756 | 132 |
Other | 6,026 | 5,029 | 3,201 |
Total noninterest expense | 42,760 | 39,611 | 30,362 |
Income before provision for income taxes | 34,289 | 32,053 | 24,139 |
Provision for income taxes | 7,595 | 6,597 | 8,826 |
Net Income | $ 26,694 | $ 25,456 | $ 15,313 |
Earnings per share - basic | $ 3.91 | $ 3.81 | $ 2.44 |
Earnings per share - diluted | 3.87 | 3.81 | 2.44 |
Dividends per share | $ 0.80 | $ 0.68 | $ 0.64 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Consolidated Statements of Comprehensive Income | |||
Net Income | $ 26,694 | $ 25,456 | $ 15,313 |
Unrealized gains (losses) on available for sale securities: | |||
Unrealized holding gains (losses) arising during period | 4,378 | (1,761) | 962 |
Amortization of unrealized holding gains on securities transferred from available for sale to held to maturity | (44) | (76) | (131) |
Reclassification adjustment for (gains) losses included in net income | (634) | 31 | 32 |
Income tax benefit (expense) | (840) | 463 | (339) |
Total other comprehensive income (loss) | 2,860 | (1,343) | 524 |
Comprehensive income | $ 29,554 | $ 24,113 | $ 15,837 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) | Serial Preferred Stock [Member]Partnership Community Bancshares, Inc. [Member] | Serial Preferred Stock [Member] | Common Stock [Member]Partnership Community Bancshares, Inc. [Member] | Common Stock [Member] | Additional Paid-in Capital [Member]Partnership Community Bancshares, Inc. [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member]Partnership Community Bancshares, Inc. [Member] | Retained Earnings [Member] | Treasury Stock [Member]Partnership Community Bancshares, Inc. [Member] | Treasury Stock [Member] | Accumulated Other Comprehensive Income (Loss) [Member]Partnership Community Bancshares, Inc. [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Partnership Community Bancshares, Inc. [Member] | Total |
Balance at Dec. 31, 2016 | $ 0 | $ 67,000 | $ 2,828,000 | $ 134,773,000 | $ (10,437,000) | $ 292,000 | $ 127,523,000 | |||||||
Net income | 0 | 0 | 0 | 15,313,000 | 0 | 0 | 15,313,000 | |||||||
Reclassification adjustment for tax rate change | 0 | 0 | 0 | (161,000) | 0 | 161,000 | 0 | |||||||
Other comprehensive Income (Loss) | 0 | 0 | 0 | 0 | 0 | 524,000 | 524,000 | |||||||
Purchase of treasury stock | 0 | 0 | 0 | 0 | (3,631,000) | 0 | (3,631,000) | |||||||
Sale of treasury stock | 0 | 0 | 0 | 0 | 896,000 | 0 | 896,000 | |||||||
Shares issued in the acquisition | 0 | 7,000 | 24,677,000 | 0 | 0 | 0 | 24,684,000 | |||||||
Cash dividends | 0 | 0 | 0 | (4,046,000) | 0 | 0 | (4,046,000) | |||||||
Amortization of stock-based compensation | 0 | 0 | 465,000 | 0 | 0 | 0 | 465,000 | |||||||
Vesting of restricted stock awards | 0 | 0 | (442,000) | 0 | 442,000 | 0 | 0 | |||||||
Balance at Dec. 31, 2017 | 0 | 74,000 | 27,528,000 | 145,879,000 | (12,730,000) | 977,000 | 161,728,000 | |||||||
Net income | 0 | 0 | 0 | 25,456,000 | 0 | 0 | 25,456,000 | |||||||
Change in accounting principle in unconsolidated subsidiary at Dec. 31, 2018 | 0 | 0 | 0 | 1,558,000 | 0 | 0 | 1,558,000 | |||||||
Other comprehensive Income (Loss) | 0 | 0 | 0 | 0 | 0 | (1,343,000) | (1,343,000) | |||||||
Purchase of treasury stock | 0 | 0 | 0 | 0 | (10,449,000) | 0 | (10,449,000) | |||||||
Sale of treasury stock | 0 | 0 | 0 | 0 | 1,347,000 | 0 | 1,347,000 | |||||||
Cash dividends | 0 | 0 | 0 | (4,530,000) | 0 | 0 | (4,530,000) | |||||||
Amortization of stock-based compensation | 0 | 0 | 556,000 | 0 | 0 | 0 | 556,000 | |||||||
Vesting of restricted stock awards | 0 | 0 | (483,000) | 0 | 483,000 | 0 | 0 | |||||||
Balance at Dec. 31, 2018 | 0 | 74,000 | 27,601,000 | 168,363,000 | (21,349,000) | (366,000) | 174,323,000 | |||||||
Net income | 0 | 0 | 0 | 26,694,000 | 0 | 0 | 26,694,000 | |||||||
Reclassification adjustment for tax rate change | 82,391 | |||||||||||||
Change in accounting principle in unconsolidated subsidiary at Dec. 31, 2019 | 0 | 0 | 0 | (100,000) | 0 | 0 | (100,000) | |||||||
Other comprehensive Income (Loss) | 0 | 0 | 0 | 0 | 0 | 2,860,000 | 2,860,000 | |||||||
Purchase of treasury stock | 0 | 0 | 0 | 0 | (4,205,000) | 0 | (4,205,000) | |||||||
Issuance of treasury stock as deferred compensation payout | 0 | 0 | 26,000 | 0 | 88,000 | 0 | 114,000 | |||||||
Shares issued in the acquisition | $ 0 | $ 5,000 | $ 35,298,000 | $ 0 | $ 0 | $ 0 | $ 35,303,000 | |||||||
Cash dividends | 0 | 0 | 0 | (5,463,000) | 0 | 0 | (5,463,000) | |||||||
Amortization of stock-based compensation | 0 | 0 | 685,000 | 0 | 0 | 0 | 685,000 | |||||||
Vesting of restricted stock awards | 0 | 0 | (525,000) | 0 | 525,000 | 0 | 0 | |||||||
Balance at Dec. 31, 2019 | $ 0 | $ 79,000 | $ 63,085,000 | $ 189,494,000 | $ (24,941,000) | $ 2,494,000 | $ 230,211,000 |
Consolidated Statement of Chang
Consolidated Statement of Changes in Stockholders' Equity (Parenthetical) - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2017 | Dec. 31, 2018 | |
Dividends Payable, Amount Per Share | $ 0.80 | $ 0.68 | |
Waupaca Bancorporation Inc [Member] | |||
Dividends Payable, Amount Per Share | $ 0.64 | ||
Stock Issued During Period, Shares, Acquisitions | 653,523 | ||
Partnership Community Bancshares, Inc. [Member] | |||
Stock Issued During Period, Shares, Acquisitions | 534,659 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) shares in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash flows from operating activities: | |||
Net income | $ 26,694,000 | $ 25,456,000 | $ 15,313,000 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Provision for loan losses | 5,250,000 | 2,935,000 | 1,055,000 |
Depreciation and amortization of premises and equipment | 1,273,000 | 1,116,000 | 1,126,000 |
Amortization of intangibles | 1,069,000 | 756,000 | 132,000 |
Net amortization of securities | 388,000 | 406,000 | 678,000 |
Amortization of stock-based compensation | 685,000 | 556,000 | 465,000 |
Accretion of purchase accounting valuations | (7,077,000) | (6,056,000) | (1,626,000) |
Net change in deferred loan fees and costs | (216,000) | 231,000 | 651,000 |
Expense for deferred income taxes | 856,000 | 1,148,000 | 624,000 |
Change in fair value of mortgage servicing rights ("MSR") and other investments | 775,000 | (119,000) | 224,000 |
(Gain) loss from sale and disposal of premises and equipment | 23,000 | 455,000 | 0 |
(Gain) loss on sale of OREO and valuation allowance | (73,000) | 252,000 | (49,000) |
Proceeds from sales of mortgage loans | 86,057,000 | 37,891,000 | 51,365,000 |
Originations of mortgage loans held for sale | (85,983,000) | (37,630,000) | (50,898,000) |
Gain on sales of mortgage loans | (1,401,000) | (617,000) | (895,000) |
Realized (gain) loss on sale of securities available for sale and other investments | (868,000) | 31,000 | 32,000 |
Undistributed income of UFS joint venture | (2,935,000) | (2,563,000) | (2,390,000) |
Undistributed income of Ansay joint venture | (1,792,000) | (2,114,000) | (1,663,000) |
Net earnings on life insurance | (625,000) | (608,000) | (549,000) |
(Increase) decrease in other assets | (720,000) | 306,000 | 278,000 |
Decrease in other liabilities | 1,268,000 | 1,220,000 | 4,450,000 |
Net cash provided by operating activities | 22,648,000 | 23,052,000 | 18,323,000 |
Activity in securities available for sale and held to maturity: | |||
Sales | 45,506,000 | 4,467,000 | 48,906,000 |
Maturities, prepayments, and calls | 13,364,000 | 15,559,000 | 12,970,000 |
Purchases | (103,848,000) | (22,909,000) | (49,594,000) |
Net increase in loans | (36,496,000) | (29,229,000) | (46,708,000) |
Dividends received from UFS | 2,108,000 | 1,505,000 | 915,000 |
Dividends received from Ansay | 1,329,000 | 1,432,000 | 964,000 |
Proceeds from sale of loans acquired in business combination | 0 | 0 | 13,000,000 |
Proceeds from sale of OREO | 1,704,000 | 3,736,000 | 329,000 |
Proceeds from sales of other investments | 984,000 | 2,671,000 | 500,000 |
Net purchases of FHLB Stock | (65,000) | 0 | 0 |
Proceeds from life insurance | 0 | 152,000 | 0 |
Proceeds from sale of premises and equipment | 0 | 445,000 | 0 |
Purchases of premises and equipment | (7,268,000) | (7,927,000) | (2,825,000) |
Investment in Ansay | (13,700,000) | 0 | 0 |
Net cash used in business combination | (9,771,000) | 0 | (19,882,000) |
Net cash used in investing activities | (106,153,000) | (30,098,000) | (41,425,000) |
Cash flows from financing activities: | |||
Net increase in deposits | 17,506,000 | 51,023,000 | 34,241,000 |
Net decrease in securities sold under repurchase agreements | 14,376,000 | (16,079,000) | (2,538,000) |
Proceeds from advances of borrowed funds | 34,000,000 | 1,214,200,000 | 476,500,000 |
Repayment of borrowed funds | (4,000,000) | (1,214,200,000) | (476,500,000) |
Proceeds from revolving line of credit | 10,000,000 | 0 | 5,000,000 |
Repayment of revolving line of credit | 0 | (5,000,000) | 0 |
Proceeds from note payable | 0 | 0 | 3,500,000 |
Repayment of notes payable | 0 | (3,500,000) | 0 |
Proceeds from subordinated debt | 0 | 0 | 11,500,000 |
Dividends paid | (5,463,000) | (4,530,000) | (4,046,000) |
Proceeds from sales of common stock | 0 | 1,347,000 | 896,000 |
Repurchase of common stock | (4,205,000) | (10,449,000) | (3,631,000) |
Net cash (used in) provided by financing activities | 62,214,000 | 12,812,000 | 44,922,000 |
Net increase (decrease) in cash and cash equivalents | (21,291,000) | 5,766,000 | 21,820,000 |
Cash and cash equivalents at beginning of period | 107,743,000 | 101,977,000 | 80,157,000 |
Cash and cash equivalents at end of period | 86,452,000 | 107,743,000 | 101,977,000 |
Cash paid during the period for: | |||
Interest | 18,938,000 | 14,440,000 | 6,751,000 |
Income taxes | 6,677,000 | 5,775,000 | 7,981,000 |
Supplemental schedule of noncash activities: | |||
Loans transferred to OREO | 4,927,000 | 1,310,000 | 2,259,000 |
MSR resulting from sale of loans | 740,000 | 356,000 | 428,000 |
Amortization of unrealized holding gains on securities transferred from available for sale to held to maturity recognized in other comprehensive income, net of tax | (35,000) | (60,000) | (80,000) |
Change in unrealized gain/loss on investment securities available for sale, net of tax | 2,895,000 | (1,367,000) | 604,000 |
Payment of deferred compensation through issuance of treasury stock | 114,000 | 0 | 0 |
Initial recognition of right-of-use lease asset and liability | 1,699,000 | 0 | 0 |
Acquisition: | |||
Fair value of assets acquired | 307,768,000 | 0 | 418,235,000 |
Fair value of liabilities assumed | 286,612,000 | 0 | 347,276,000 |
Net assets acquired | $ 21,156,000 | $ 0 | $ 70,959,000 |
Common stock issued in acquisition | 35,303 | 0 | 24,684 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | Note 1 Summary of Significant Accounting Policies The accounting and reporting policies of Bank First Corporation and Subsidiaries ( “Corporation” ) conform to generally accepted accounting principles ( “GAAP” ) in the United States and general practices within the financial institution industry. Significant accounting and reporting policies are summarized below. Principles of Consolidation The consolidated financial statements include the accounts of the Corporation and its wholly owned subsidiaries, Veritas Asset Holdings, LLC ( “Veritas” ) and Bank First, National Association ( “Bank” ). The Bank’s wholly owned subsidiaries are Bank First Investments, Inc. and TVG Holdings, Inc. ( “TVG” ). All significant intercompany balances and transactions have been eliminated. The Bank and TVG have investments in minority-owned subsidiaries that are accounted for using the equity method in the consolidated financial statements. The Bank owns 49.8% of UFS which provides data processing solutions to over 60 banks in the Midwest. TVG owns 40.0% of Ansay providing clients throughout the Midwest with superior insurance and risk management solutions. Organization The Corporation provides a variety of financial services to individual and business customers, primarily located in Wisconsin, through the Bank. The Bank is subject to competition from other traditional and nontraditional financial institutions and is also subject to the regulations of certain federal agencies and undergoes periodic examinations by those regulatory authorities including the Office of the Comptroller of the Currency and the Federal Reserve Bank. Use of Estimates in Preparation of Financial Statements The preparation of the accompanying consolidated financial statements in conformity with GAAP in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results may differ from these estimates. The allowance for loan losses, carrying value of real estate owned, carrying value of goodwill, fair value of mortgage servicing rights, and fair values of financial instruments are inherently subjective and are susceptible to significant change. Business Combinations The Corporation accounts for business combinations under the acquisition method of accounting in accordance with Financial Accounting Standards Board (“FASB” ) Accounting Standards Codification ( “ASC” ) 805, Business Combinations. The Corporation recognizes the full fair value of the assets acquired and liabilities assumed and immediately expenses transaction costs. There is no separate recognition of the acquired allowance for loan losses on the acquirer’s balance sheet as credit related factors are incorporated directly into the fair value of the net tangible and intangible assets acquired. If the amount of consideration exceeds the fair value of assets purchased less the fair value of liabilities assumed, goodwill is recorded. Alternatively, if the amount by which the fair value of assets purchased exceeds the fair value of liabilities assumed and consideration paid, a gain (bargain purchase gain) is recorded. Fair values are subject to refinement for up to one year after the closing date of an acquisition as information relative to closing date fair values becomes available. Results of operations of the acquired business are included in the statement of income from the effective date of the acquisition. Additional information regarding acquisitions is provided in Note 2. Cash and Cash Equivalents For purposes of reporting cash flows in the consolidated financial statements, cash and cash equivalents include cash on hand, interest-bearing and noninterest-bearing accounts in other financial institutions, and federal funds sold, all of which have original maturities of three months or less. Generally, federal funds are purchased and sold for one day periods. In the normal course of business, the Corporation maintains cash and due from bank balances with correspondent banks. Accounts at each institution that are insured by the Federal Deposit Insurance Corporation have up to $250,000 of insurance. Total uninsured balances held at December 31, 2019 and 2018 were approximately $1,900,000 and $1,013,000, respectively. The Bank is required to maintain deposits on hand or with the Federal Reserve Bank to meet specific reserve requirements. For December 31, 2019 and 2018 those required reserves were approximately $26,184,000 and $28,302,000 respectively. Securities Securities are classified as held to maturity or available for sale at the time of purchase. Investment securities classified as held to maturity, which management has the intent and ability to hold to maturity, are reported at amortized cost. Investment securities classified as available for sale, which management has the intent and ability to hold for an indefinite period of time, but not necessarily to maturity, are carried at fair value, with unrealized gains and losses, net of related deferred income taxes, included in stockholders’ equity as a separate component of other comprehensive income. The net carrying value of debt securities classified as held to maturity or available for sale is adjusted for amortization of premiums and accretion of discounts utilizing the effective interest method over the expected estimated maturity. Such amortization and accretion is included as an adjustment to interest income from securities. Interest and dividends are included in interest income from securities. Transfers of debt securities into the held to maturity classification from the available for sale classification are made at fair value as of the date of transfer. The unrealized holding gain or loss as of the date of transfer is retained in other comprehensive income and in the carrying value of the held to maturity securities, establishing the amortized cost of the security. These unrealized holding gains and losses as of the date of transfer are amortized or accreted over the remaining life of the security. Unrealized gains or losses considered temporary and the noncredit portion of unrealized losses deemed other-than-temporary are reported as an increase or decrease in accumulated other comprehensive income. The credit related portion of unrealized losses deemed other-than-temporary is recorded in current period earnings. Realized gains or losses, determined on the basis of the cost of specific securities sold, are included in earnings. The Bank evaluates securities for other-than-temporary impairment at least on a quarterly basis, and more frequently when economic or market concerns warrant such evaluation. As part of such monitoring, the credit quality of individual securities and their issuers are assessed. In addition, management considers the length of time and extent that fair value has been less than cost, the financial condition and near-term prospects of the issuer, and that the Corporation does not have the intent to sell the security and it is more likely than not that it will not have to sell the security before recovery of its cost basis. Adjustments to market value that are considered temporary are recorded as a separate component of equity, net of tax. If an impairment of security is identified as other-than-temporary based on information available such as the decline in the credit worthiness of the issuer, external market ratings or the anticipated or realized elimination of associated dividends, such impairments are further analyzed to determine if a credit loss exists. If there is a credit loss, it will be recorded in the consolidated statement of income in the period of identification. Other Investments Other investments are carried at cost, or, where available, recently observable market prices, which approximates fair value, and consist of Federal Home Loan Bank of Chicago ( “FHLB” ) stock, Federal Reserve Bank stock, Bankers’ Bancorporation stock and preferred stock in a community development project. Other investments are evaluated for impairment at least on an annual basis. Loans Held for Sale Loans originated and intended for sale in the secondary market, consisting of the current origination of certain fixed-rate mortgage loans, are carried at the lower of cost or estimated fair value in the aggregate. A gain or loss is recognized at the time of the sale reflecting the present value of the difference between the contractual interest rate of the loans sold and the yield to the investor, adjusted for the initial value of mortgage servicing rights associated with loans sold with servicing retained. Net unrealized losses, if any, are recorded as a valuation allowance and charged to earnings. Loans and Related Interest Income - Originated Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoffs are generally reported at their outstanding unpaid principal balances adjusted for charge-offs and the allowance for loan losses. The accrual of interest on loans is calculated using the simple interest method on daily balances of the principal amount outstanding and is recognized in the period earned utilizing the loan convention applicable by loan type. Loan origination fees, net of certain direct loan origination costs, are deferred and recognized in interest income using the effective interest method over the estimated life of the loan. The accrual of interest is discontinued when a loan becomes 90 days past due and is not both well collateralized and in the process of collection, or when management believes, after considering economic and business conditions and collection efforts, that the principal or interest will not be collectible in the normal course of business. When loans are placed on nonaccrual or charged off, all unpaid accrued interest is reversed and additional income is recorded only to the extent that payments are received and the collection of principal is reasonably assured. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current, when the obligation has performed in accordance with the contractual terms for a reasonable period of time, and future payments of principal and interest are reasonably assured. Loans are considered impaired if it is probable that payment of interest and principal will not be made in accordance with the contractual terms of the loan agreement. Total impaired loans are evaluated based on the fair value of the collateral rather than on discounted cash flow basis. Loans and Related Interest Income - Acquired Acquired loans are recorded at their estimated fair value at the acquisition date, and are initially classified as either purchase credit impaired ( “PCI” ) loans (i.e. loans that reflect credit deterioration since origination and it is probable at acquisition that the Corporation will be unable to collect all contractually required payments) or purchased non-impaired loans (i.e. performing acquired loans). PCI loans are accounted for under the accounting guidance for loans and debt securities acquired with deteriorated credit quality, found in FASB ASC Topic 310‑30, Receivables— Loans and Debt Securities Acquired with Deteriorated Credit Quality. The Corporation estimates the amount and timing of expected principal, interest and other cash flows for each loan or pool of loans meeting the criteria above, and determines the excess of the loan’s scheduled contractual principal and contractual interest payments over all cash flows expected to be collected at acquisition as an amount that should not be accreted. These credit discounts (nonaccretable marks) are included in the determination of the initial fair value for acquired loans; therefore, an allowance for loan losses is not recorded at the acquisition date. Differences between the estimated fair values and expected cash flows of acquired loans at the acquisition date that are not credit-based (accretable marks) are subsequently accreted to interest income over the estimated life of the loans using a method that approximates a level yield method if the timing and amount of the future cash flows is reasonably estimable. Subsequent to the acquisition date for PCI loans, increases in cash flows over those expected at the acquisition date result in a move of the discount from nonaccretable to accretable. Decreases in expected cash flows after the acquisition date are recognized through the provision for loan losses. Performing acquired loans are accounted for under FASB ASC Topic 310‑20, Receivables—Nonrefundable Fees and Other Costs. Performance of certain loans may be monitored and based on management’s assessment of the cash flows and other facts available, portions of the accretable difference may be delayed or suspended if management deems appropriate. The Corporation’s policy for determining when to discontinue accruing interest on performing acquired loans and the subsequent accounting for such loans is essentially the same as the policy for originated loans described above. Allowance for Loan Losses - Originated The allowance for loan losses ( “ALL” ) is established through a provision for loan losses charged to expense as losses are estimated to have occurred. Loan losses are charged against the allowance when management believes that the collectability of the principal is unlikely. Subsequent recoveries, if any, are credited to the allowance. Management regularly evaluates the allowance for loan losses using general economic conditions, the Corporation’s past loan loss experience, composition of the portfolio, and other relevant factors. This evaluation is inherently subjective since it requires material estimates that may be susceptible to significant change. The ALL consists of specific reserves for certain impaired loans and general reserves for non-impaired loans. Specific reserves reflect estimated losses on impaired loans from management’s analyses developed through specific credit allocations. The specific credit reserves are based on regular analyses of impaired non-homogenous loans greater than $250,000. These analyses involve a high degree of judgment in estimating the amount of loss associated with specific loans, including estimating the amount and timing of future cash flows and collateral values. The general reserve is based on the Bank’s historical loss experience which is updated quarterly. The general reserve portion of the ALL also includes consideration of certain qualitative factors such as 1) changes in lending policies and/or underwriting practices, 2) national and local economic conditions 3) changes in portfolio volume and nature, 4) experience, ability and depth of lending management and other relevant staff, 5) levels of and trends in past-due and nonaccrual loans and quality, 6) changes in loan review and oversight, 7) impact and effects of concentrations and 8) other issues deemed relevant. Management believes that the allowance for loan losses is adequate. While management uses available information to recognize losses on loans, future additions to the allowance may be necessary based on changes in economic conditions. In addition, various regulatory agencies, as an integral part of their examination process, periodically review the allowance for loan losses. Such agencies may require the Bank to recognize additions to the allowance based on their judgments of information available to them at the time of their examination. Allowance for Loan Losses - Acquired An ALL is calculated using a methodology similar to that described for originated loans. Performing acquired loans are subsequently evaluated for any required allowance at each reporting date. Such required allowance for each loan pool is compared to the remaining fair value discount for that pool. If greater, the excess is recognized as an addition to the allowance through a provision for loan losses. If less than the discount, no additional allowance is recorded. Charge-offs and losses first reduce any remaining fair value discount for the loan pool and once the discount is depleted, losses are applied against the allowance established for that pool. For PCI loans after acquisition, cash flows expected to be collected are recast for each loan periodically as determined appropriate by management. If the present value of expected cash flows for a loan is less than its carrying value, impairment is reflected by an increase in the ALL and a charge to the provision for loan losses. If the present value of the expected cash flows for a loan is greater than its carrying value, any previously established ALL is reversed and any remaining difference increases the accretable yield which will be taken into income over the remaining life of the loan. Loans which were considered troubled debt restructurings by Partnership Community Bancshares, Inc. and Waupaca Bancorporation, Inc. prior to the acquisition are not required to be classified as troubled debt restructurings in the Corporation’s consolidated financial statements unless or until such loans would subsequently meet criteria to be classified as such, since acquired loans were recorded at their estimated fair values at the time of the acquisition. Premises and Equipment Premises and equipment are stated at cost less accumulated depreciation computed on the straight-line method over the estimated useful lives of the assets. Premises and equipment acquired in corporate acquisitions are recorded at estimated fair value on the date of acquisition. Maintenance and repair costs are charged to expense as incurred. Gains or losses on disposition of premises and equipment are reflected in income. Premises and equipment, and other long-term assets, are reviewed for impairment when events indicate their carrying amount may not be recoverable from future undiscounted cash flows. If impaired, the assets are recorded at fair value. Depreciation expense is computed using the straight-line method over the following estimated useful lives. Buildings and improvements 40 years Land improvements 20 years Furniture, fixtures and equipment 2-7 years Other Real Estate Owned Assets acquired through, or in lieu of, loan foreclosure are held for sale and are initially recorded at fair value at the date of foreclosure less estimated costs to sell the asset, establishing a new cost basis. Any write downs at the time of foreclosure are charged to the allowance for loan loss. OREO properties acquired in conjunction with corporate acquisitions are recorded at fair value on the date of acquisition. Subsequent to foreclosure, valuations are periodically performed by management, and a valuation allowance is established if fair value declines below carrying value. Costs relating to the development and improvement of the property are capitalized. Revenue and expenses from operations and changes in the valuation allowance are included in other expenses. Intangible Assets and Goodwill Intangible assets consist of the value of core deposits and mortgage servicing assets and the excess of purchase price over fair value of net assets (goodwill). Core deposits are stated at cost less accumulated amortization and are amortized on a sum of the year’s digits basis over a period of one to ten years. See Note 2 for additional information on acquisitions completed in 2019 and 2017. Mortgage servicing rights are recognized as separate assets when rights are acquired through purchase or through sale of mortgage loans with servicing retained. Servicing rights acquired through sale of financial assets are recorded based on the fair value of the servicing right. The determination of fair value is based on a valuation model and includes stratifying the mortgage servicing rights by predominant characteristics, such as interest rates and terms, and estimating the fair value of each stratum based on the present value of estimated future net servicing income. The valuation model incorporates assumptions that market participants would use in estimating future net servicing income, such as costs to service, a discount rate, and prepayment speeds. Changes in fair value are recorded as an adjustment to earnings. The Corporation performs a “qualitative” assessment of goodwill to determine whether further impairment testing of indefinite-lived intangible assets is necessary on at least an annual basis. If it is determined, as a result of performing a qualitative assessment over goodwill, that it is more likely than not that goodwill is impaired, management will perform an impairment test to determine if the carrying value of goodwill is realizable. The Corporation evaluated goodwill and core deposit intangibles for impairment during 2019, 2018 and 2017, determining that there was no goodwill or core deposit intangible impairment. Income Taxes The Corporation files one consolidated federal income tax return and two state returns. Federal income tax expense is allocated to each subsidiary based on an intercompany tax sharing agreement. Deferred tax assets and liabilities have been determined using the liability method. Deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities and the current enacted tax rates which will be in effect when these differences are expected to reverse. Provision (benefit) for deferred taxes is the result of changes in the deferred tax assets and liabilities. Treasury Stock Common stock shares repurchased by the Corporation are recorded as treasury stock at cost. Securities Sold Under Repurchase Agreements The Corporation sells securities under repurchase agreements. These transactions are accounted for as collateralized financing transactions and are recorded at the amounts at which the securities were sold. The Corporation may have to provide additional collateral to the counterparty, as necessary. Off-Balance-Sheet Financial Instruments In the ordinary course of business, the Corporation has entered into off-balance-sheet financial instruments including commitments to extend credit, unfunded commitments under lines of credit, and letters of credit. Such financial instruments are recorded in the consolidated financial statements when they are funded. Advertising Advertising costs are generally expensed as incurred. Per Share Computations Weighted average shares outstanding were 6,820,225, 6,673,758, and 6,285,901 for the years ended December 31, 2019, 2018 and 2017, respectively. All outstanding unvested share-based payment awards that contain rights to non-forfeitable dividends are considered participating securities for basic and diluted earnings per share calculations. There were 82,391 average shares of dilutive instruments outstanding during the year ended December 31, 2019. There were no dilutive instruments outstanding during 2018 or 2017. Loss Contingencies Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated. Management does not believe that there are any such matters that will have a material effect on the consolidated financial statements at December 31, 2019 and 2018. Transfers of Financial Assets Transfers of financial assets are accounted for as sales when control over the assets has been relinquished. Control over transferred assets is deemed to be surrendered when the assets have been isolated from the Bank, the transferee obtains the right, free of conditions that constrain it from taking advantage of that right, to pledge or exchange the transferred assets and the Bank does not maintain effective control over the transferred assets through an agreement to repurchase them before maturity. Comprehensive Income GAAP normally requires that recognized revenues, expenses, gains and losses be included in net income. In addition to net income, another component of comprehensive income includes the after-tax effect of changes in unrealized gains and losses on available for sale securities. This item is reported as a separate component of stockholders’ equity. The Corporation presents comprehensive income in the statement of comprehensive income. Stock-based Compensation The Corporation uses the fair value method of recognizing expense for stock-based compensation based on the fair value of restricted stock awards at the date of grant as prescribed by accounting standards codification Topic 781‑10 Compensation/Stock Compensation. Mortgage Banking Derivatives Commitments to fund mortgage loans (interest rate locks) to be sold into the secondary market and forward commitments for the future delivery of these mortgage loans are accounted for as free standing derivatives. Fair values of these mortgage derivatives are estimated based on changes in mortgage interest rates from the date the interest rate on the loan is locked. The Bank enters into forward commitments for the future delivery of mortgage loans when interest rate locks are entered into in order to hedge the change in interest rates resulting from its commitments to fund loans. The forward commitments for the future delivery of mortgage loans are based on the Bank’s “best efforts” and therefore the Bank is not penalized if a loan is not delivered to the investor if the loan did not get originated. Changes in the fair values of these derivatives generally offset each other and are included in “other income” in the consolidated statements of income. Reclassifications Certain 2018 and 2017 amounts have been reclassified to conform to the presentation used in 2019. These reclassifications had no effect on the operations, financial condition or cash flows of the Corporation. New Accounting Pronouncements In May 2014, the FASB issued Accounting Standard Update ( “ASU”) 2014‑09, Revenue from Contracts with Customers (Topic 606) (ASU 2014‑09). ASU 2014‑09 implements a common revenue standard that clarifies the principles for recognizing revenue. The core principle of ASU 2014‑09 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply the following steps: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract and (v) recognize revenue when (or as) the entity satisfies a performance obligation. ASU 2015‑14, Revenue from Contracts with Customers (Topic 606) (ASU 2015‑14) was issued in August 2015 which defers adoption to annual reporting periods beginning after December 15, 2017 and interim reporting periods within that year. The timing of the Corporation’s revenue recognition did not materially change. The Corporation’s largest portions of revenue, interest and fees on loans and gain on sales of loans, are specifically excluded from the scope of the guidance, and the Corporation currently recognizes the majority of the remaining revenue sources in a manner that management believes is consistent with the new guidance. Unconsolidated subsidiaries of the Bank did have a material impact as a result of this ASU, and implementation resulted in a decrease of $100,000 to retained earnings during 2019 and an increase of $1,588,000 to retained earnings during 2018. In January 2016, the FASB issued ASU 2016‑01, Financial Instruments—Overall (Subtopic 825‑10): Recognition and Measurement of Financial Assets and Financial Liabilities (ASU 2016‑01). This guidance changes how entities account for equity investments that do not result in consolidation and are not accounted for under the equity method of accounting. Entities will be required to measure these investments at fair value at the end of each reporting period and recognize changes in fair value in net income. A practicability exception will be available for equity investments that do not have readily determinable fair values; however, the exception requires the Corporation to adjust the carrying amount for impairment and observable price changes in orderly transactions for the identical or a similar investment of the same issuer. This guidance also changes certain disclosure requirements and other aspects of current GAAP. This guidance was effective for fiscal years beginning after December 15, 2017 and for interim reporting periods within that year. The adoption of this ASU did not have a material impact on the Corporation’s consolidated financial statements. In February 2016, the FASB issued ASU 2016‑02, Leases (Topic 842) (ASU 2016‑02). Certain aspects of this ASU were updated in July 2018 by the issuance of ASU, 2018‑10, Codification Improvements to Topic 842, Leases. The new guidance established the principles to report transparent and economically neutral information about the assets and liabilities that arise from leases. Entities are required to recognize the lease assets and lease liabilities that arise from leases in the statement of financial position and to disclose qualitative and quantitative information about lease transactions, such as information about variable lease payments and options to renew and terminate leases. This guidance was effective for fiscal years beginning after December 15, 2018 and interim reporting periods within that year. See Note 21 for details concerning how the adoption of this ASU impacted the Corporation's consolidated financial statements. In June 2016, the FASB issued ASU 2016‑13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. Certain aspects of this ASU were updated in November 2018 by the issuance of ASU 2018‑19, Codification Improvements to Topic 326, Financial Instruments—Credit Losses . The main objective of the ASU is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. To achieve this objective, the amendments in the ASU replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. During 2019 FASB issued ASU 2019-10 which delayed the effective date of ASU 2016-13 for smaller, publicly traded companies, until interim and annual periods beginning after December 15, 2022. This delay applies to the Corporation as it was classified as a "Smaller reporting company" as defined in Rule 12b-2 of the Exchange Act as of the date ASU 2019-10 was enacted. The Corporation is currently evaluating the impact of ASU 2016‑13 on the consolidated financial statements, although the general expectation in the banking industry is that the implementation of this standard will result in higher required balances in the allowance for loan losses. In January 2017, the FASB issued ASU 2017‑04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment . The amendments in this ASU were issued to address concerns over the cost and complexity of the two-step goodwill impairment test and resulted in the removal of the second step of the test. The amendments require an entity to apply a one-step quantitative test and record the amount of goodwill impairment as the excess of a reporting unit’s carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit. The new guidance does not amend the optional qualitative assessment of goodwill impairment. This ASU is intended to reduce the cost and complexity of the two-step goodwill impairment test and is effective for annual and interim goodwill impairment tests in fiscal years beginning after December 15, 2019, with early adoption permitted for testing performed after January 1, 2017. Upon adoption, the amendments should be applied on a prospective basis and the entity is required to disclose the nature of and reason for the change in accounting principle upon transition. The adoption of this guidance is not expected to have a significant impact on the Corporation’s consolidated financial state |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2019 | |
Acquisitions | |
Acquisitions | Note 2 Acquisitions Partnership Community Bancshares, Inc. On July 12, 2019, the Corporation completed a merger with Partnership Community Bancshares, Inc. (“Partnership”), a bank holding company headquartered in Cedarburg, Wisconsin, pursuant to the Agreement and Plan of Bank Merger, dated as of January 22, 2019 and as amended on April 30, 2019, by and among the Corporation and Partnership, whereby Partnership merged with and into the Corporation, and Partnership Bank, Partnership’s wholly-owned banking subsidiary, merged with and into the Bank. Partnership’s principal activity was the ownership and operation of Partnership Bank, a state-chartered banking institution that operated four branches in Wisconsin at the time of closing. The merger consideration totalled approximately $49,588,000. Pursuant to the terms of the Merger Agreement, Partnership shareholders had the option to receive either 0.34879 shares of the Corporation’s common stock or $17.3001 in cash for each outstanding share of Partnership common stock, and cash in lieu of any remaining fractional share. The stock versus cash elections by the Partnership shareholders were subject to final consideration being made up of approximately $14,285,000 in cash and 534,659 shares of Corporation common stock, valued at approximately $35,303,000 (based on a value of $66.03 per share on the closing date). The purpose of the merger was for strategic reasons beneficial to the Corporation. The acquisition is consistent with its plan to drive growth and efficiency through increased scale, leverage the strengths of each bank across the combined customer base, enhance profitability, and add liquidity and shareholder value. The Corporation accounted for the transaction under the acquisition method of accounting, and thus, the financial position and results of operations of Partnership prior to the consummation date were not included in the accompanying consolidated financial statements. The accounting required assets purchased and liabilities assumed to be recorded at their respective fair values at the date of acquisition. The Corporation determined the fair value of core deposit intangibles, securities, premises and equipment, loans, other assets and liabilities, deposits and borrowings with the assistance of third party valuations, appraisals, and third party advisors. The estimated fair values will be subject to refinement for up to one year after the consummation as additional information becomes available relative to the closing date fair values. The fair value of the assets acquired and liabilities assumed on July 12, 2019 was as follows: As Recorded by Partnership As Recorded by Community Fair Value Bank First (in thousands) Bancshares Adjustments Corporation Cash, cash equivelants and securities $ 21,447 $ (291) $ 21,156 Other investments 441 441 Loans 276,279 (957) 275,322 Premises and equipment, net 6,066 (2,940) 3,126 Core deposit intangible — 4,236 4,236 Other assets 3,668 (181) 3,487 Total assets acquired $ 307,901 $ (133) $ 307,768 Deposits $ 268,653 $ 154 $ 268,807 Subordinated debt 7,000 195 7,195 Other borrowings 9,800 (18) 9,782 Other liabilities 841 (13) 828 Total liabilities assumed $ 286,294 $ 318 $ 286,612 Excess of assets acquired over liabilties assumed $ 21,607 $ (451) $ 21,156 Less: purchase price 49,588 Goodwill $ 28,432 Waupaca Bancorporation, Inc. On October 27, 2017, the Corporation completed a merger with Waupaca Bancorporation, Inc. (“Waupaca”), a bank holding company headquartered in Waupaca, Wisconsin, pursuant to the Agreement and Plan of Bank Merger, dated as of May 11, 2017 and as amended on July 20, 2017, by and among the Corporation, BFNC Merger Sub, LLC, a wholly-owned subsidiary of the Corporation, and Waupaca, whereby Waupaca merged with and into the Corporation, and First National Bank, Waupaca’s wholly-owned banking subsidiary, was merged with and into the Bank. Waupaca’s principal activity was the ownership and operation of First National Bank, a national banking institution that operated eight (8) branches in Wisconsin at the time of closing. The merger consideration totalled approximately $78,060,000, 70% of which was distributed in cash and 30% of which was distributed in the form of Corporation common stock. The fair value of the assets acquired and liabilities assumed on October 27, 2017 was as follows: As recorded by As recorded by Waupaca Fair Value Bank First Bancorporation, Inc. Adjustment Corporation (in thousands) Cash, cash equivalents and securities $ 62,174 $ (400) $ 61,774 Loans 337,548 1,716 339,264 Other real estate owned 3,348 (640) 2,708 Premises and equipment, net 7,661 (4,105) 3,556 Core deposit intangible — 3,097 3,097 Other assets 8,182 (346) 7,836 Total assets acquired $ 418,913 $ (678) $ 418,235 Deposits $ 344,798 $ 810 $ 345,608 Other liabilities 1,605 63 1,668 Total liabilities assumed $ 346,403 $ 873 $ 347,276 Excess of assets acquired over liabilities assumed $ $ (1,551) $ 70,959 Less: purchase price 78,060 Goodwill (originally recorded) 7,101 Refinement to fair value estimates during 2018 (61) Goodwill (after refinement) $ 7,040 |
Securities
Securities | 12 Months Ended |
Dec. 31, 2019 | |
Securities | |
Securities | Note 3 Securities The following is a summary of available for sale securities (dollar amounts in thousands): Gross Gross Amortized Unrealized Unrealized Estimated Cost Gains Losses Fair Value December 31, 2019 Obligations of U.S. Government sponsored agencies $ 12,218 $ — $ (158) $ 12,060 Obligations of states and political subdivisions 52,594 2,197 (20) 54,771 Mortgage-backed securities 50,770 988 (38) 51,720 Corporate notes 62,794 172 (11) 62,955 Total available for sale securities $ 178,376 $ 3,357 $ (227) $ 181,506 December 31, 2018 Obligations of states and political subdivisions $ 51,292 $ 709 $ (108) $ 51,893 Mortgage-backed securities 51,519 66 (1,016) 50,569 Corporate notes 16,708 — (264) 16,444 Total available for sale securities $ 119,519 $ 775 $ (1,388) $ 118,906 The following is a summary of held to maturity securities (dollar amounts in thousands): Gross Gross Amortized Unrealized Unrealized Estimated Cost Gains Losses Fair Value December 31, 2019 U.S. Treasury securities $ 33,527 $ 1,076 $ (22) $ 34,581 Obligations of states and political subdivisions 10,207 15 — 10,222 Total held to maturity securities $ 43,734 $ 1,091 $ (22) $ 44,803 December 31, 2018 U.S. Treasury securities $ 28,975 $ 92 $ (389) $ 28,678 Obligations of states and political subdivisions 11,793 6 — 11,799 Total held to maturity securities $ 40,768 $ 98 $ (389) $ 40,477 At December 31, 2019, unrealized losses in the investment securities portfolio related to debt securities. The unrealized losses on these debt securities arose primarily due to changing interest rates and are considered to be temporary. From the December 31, 2019 tables above, 1 out of 15 U.S. Treasury securities, 5 out of 5 U.S. Government sponsored agency securities, 5 out of 101 obligations of states and political subdivisions, 8 out of 82 mortgage-backed securities, and 1 out of 7 corporate notes contained unrealized losses. At December 31, 2019 and 2018, management has both the intent and ability to hold securities containing unrealized losses. The following table shows the fair value and gross unrealized losses of securities with unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position (dollar amounts in thousands): Less Than 12 Months Greater Than 12 Months Total Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses December 31, 2019 - Available for Sale Obligations of U.S. Government sponsored agencies $ 12,059 $ (158) $ — $ — $ 12,059 $ (158) Obligations of states and political subdivisions 5,636 (19) 999 (1) 6,635 (20) Mortgage-backed securities 4,038 (26) 2,187 (12) 6,225 (38) Corporate notes 3,925 (11) — — 3,925 (11) Totals $ 25,658 $ (214) $ 3,186 $ (13) $ 28,844 $ (227) December 31, 2019 - Held to Maturity U.S. Treasury securities $ 2,958 $ (22) $ — $ — $ 2,958 $ (22) December 31, 2018 - Available for Sale Obligations of states and political subdivisions $ 10,024 $ (64) $ 4,132 $ (44) $ 14,156 $ (108) Mortgage-backed securities 13,352 (183) 31,718 (833) 45,070 (1,016) Corporate notes — — 12,531 (264) 12,531 (264) Totals $ 23,376 $ (247) $ 48,381 $ (1,141) $ 71,757 $ (1,388) December 31, 2018 - Held to Maturity U.S. Treasury securities $ 8,422 $ (46) $ 11,580 $ (343) $ 20,002 $ (389) Contractual maturities will differ from expected maturities for mortgage-backed securities because borrowers may have the right to call or prepay obligations without penalties. The following is a summary of amortized cost and estimated fair value of securities, by contractual maturity, as of December 31, 2019 (dollar amounts in thousands): Available for Sale Held to Maturity Amortized Estimated Amortized Estimated Cost Fair Value Cost Fair Value Due in one year or less $ 47,437 $ 47,446 $ 4,136 $ 4,151 Due after one year through 5 years 23,339 23,783 16,777 17,120 Due after 5 years through ten years 13,153 13,843 19,912 20,623 Due after 10 years 43,677 44,714 2,909 2,909 Subtotal 127,606 129,786 43,734 44,803 Mortgage-backed securities 50,770 51,720 — — Total $ 178,376 $ 181,506 $ 43,734 $ 44,803 Following is a summary of the proceeds from sales of securities available for sale, as well as gross gains and losses, from the years ended December 31 (dollar amounts in thousands): 2019 2018 2017 Proceeds from sales of securities $ 45,506 $ 4,467 $ 48,906 Gross gains on sales 657 41 73 Gross losses on sales (23) (72) (105) As of December 31, 2019 and 2018, the carrying values of securities pledged to secure public deposits, securities sold under repurchase agreements, and for other purposes required or permitted by law were approximately $137,640,000 and $69,679,000, respectively. |
Loans
Loans | 12 Months Ended |
Dec. 31, 2019 | |
Loans | |
Loans | Note 4 Loans The composition of loans at December 31 is as follows (dollar amounts in thousands): 2019 2018 Commercial/industrial $ 302,538 $ 297,576 Commercial real estate - owner occupied 459,782 416,097 Commercial real estate - non- owner occupied 353,723 252,717 Construction and development 132,296 60,927 Residential 1‑4 family 448,605 368,673 Consumer 29,462 26,854 Other 10,440 6,369 Subtotals 1,736,846 1,429,213 ALL (11,396) (12,248) Loans, net of ALL 1,725,450 1,416,965 Deferred loan fees and costs (503) (719) Loans, net $ 1,724,947 $ 1,416,246 A summary of the activity in the allowance for loan losses by loan type as of December 31, 2019 and December 31, 2018 is as follows (dollar amounts in thousands): Commercial Commercial Real Estate - Real Estate - Construction Commercial / Owner Non-Owner and Residential Industrial Occupied Occupied Development 1-4 Family Consumer Other Total ALL - January 1, 2019 $ 3,021 $ 3,750 $ 2,100 $ 725 $ 2,472 $ 148 $ 32 $ 12,248 Charge-offs (1,229) (4,994) (62) — (276) (76) (41) (6,678) Recoveries 11 356 60 — 130 11 8 576 Provision 517 5,475 (520) (177) (157) 58 54 5,250 ALL - December 31, 2019 2,320 4,587 1,578 548 2,169 141 53 11,396 ALL ending balance individually evaluated for impairment 760 80 — — — — — 840 ALL ending balance collectively evaluated for impairment $ 1,560 $ 4,507 $ 1,578 $ 548 $ 2,169 $ 141 $ 53 $ 10,556 Loans outstanding - December 31, 2019 $ 302,538 $ 459,782 $ 353,723 $ 132,296 $ 448,605 $ 29,462 $ 10,440 $ 1,736,846 Loans ending balance individually evaluated for impairment 1,878 960 — — — — — 2,838 Loans ending balance collectively evaluated for impairment $ 300,660 $ 458,822 $ 353,723 $ 132,296 $ 448,605 $ 29,462 $ 10,440 $ 1,734,008 Commercial Commercial Real Estate - Real Estate - Construction Commercial / Owner Non-Owner and Residential Industrial Occupied Occupied Development 1-4 Family Consumer Other Total ALL - January 1, 2018 $ 2,362 $ 3,376 $ 1,987 $ 945 $ 2,728 $ 191 $ 23 $ 11,612 Charge-offs (35) (2,374) — (83) (140) (48) (37) (2,717) Recoveries 2 158 3 — 233 12 10 418 Provision 692 2,590 110 (137) (349) (7) 36 2,935 ALL - December 31, 2018 3,021 3,750 2,100 725 2,472 148 32 12,248 ALL ending balance individually evaluated for impairment 566 353 — — 160 — — 1,079 ALL ending balance collectively evaluated for impairment $ 2,455 $ 3,397 $ 2,100 $ 725 $ 2,312 $ 148 $ 32 $ 11,169 Loans outstanding - December 31, 2018 $ 297,576 $ 416,097 $ 252,717 $ 60,927 $ 368,673 $ 26,854 $ 6,369 $ 1,429,213 Loans ending balance individually evaluated for impairment 5,667 7,796 — — 702 — — 14,165 Loans ending balance collectively evaluated for impairment $ 291,909 $ 408,301 $ 252,717 $ 60,927 $ 367,971 $ 26,854 $ 6,369 $ 1,415,048 A summary of past due loans as of December 31, 2019 are as follows (dollar amounts in thousands): 90 Days 30-89 Days or more Past Due Past Due 2019 Accruing and Accruing Non-Accrual Total Commercial/industrial $ 235 $ — $ 1,923 $ 2,158 Commercial real estate - owner occupied 1,124 — 2,513 3,637 Commercial real estate - non-owner occupied — — 75 75 Construction and development 768 11 — 779 Residential 1‑4 family 805 307 550 1,662 Consumer 70 36 32 138 Other — — — — $ 3,002 $ 354 $ 5,093 $ 8,449 A summary of past due loans as of December 31, 2018 are as follows (dollar amounts in thousands): 90 Days 30-89 Days or more Past Due Past Due 2018 Accruing and Accruing Non-Accrual Total Commercial/industrial $ 76 $ — $ 8,001 $ 8,077 Commercial real estate - owner occupied 59 — 10,311 10,370 Commercial real estate - non-owner occupied — 58 233 291 Construction and development — — — — Residential 1‑4 family 275 362 1,549 2,186 Consumer 9 3 5 17 Other — — — — $ 419 $ 423 $ 20,099 $ 20,941 Credit Quality: We utilize a numerical risk rating system for commercial relationships whose total indebtedness equals $250,000 or more. All other types of relationships (ex: residential, consumer, commercial under $250,000 of indebtedness) are assigned a “Pass” rating, unless they have fallen 90 days past due or more, at which time they receive a rating of 7. The Corporation uses split ratings for government guaranties on loans. The portion of a loan that is supported by a government guaranty is included with other Pass credits. The determination of a commercial loan risk rating begins with completion of a matrix, which assigns scores based on the strength of the borrower’s debt service coverage, collateral coverage, balance sheet leverage, industry outlook, and customer concentration. A weighted average is taken of these individual scores to arrive at the overall rating. This rating is subject to adjustment by the loan officer based on facts and circumstances pertaining to the borrower. Risk ratings are subject to independent review. Commercial borrowers with ratings between 1 and 5 are considered Pass credits, with 1 being most acceptable and 5 being just above the minimum level of acceptance. Commercial borrowers rated 6 have potential weaknesses which may jeopardize repayment ability. Borrowers rated 7 have a well-defined weakness or weaknesses such as the inability to demonstrate significant cash flow for debt service based on analysis of the company’s financial information. These loans remain on accrual status provided full collection of principal and interest is reasonably expected. Otherwise they are deemed impaired and placed on nonaccrual status. Borrowers rated 8 are the same as 7 rated credits with one exception: collection or liquidation in full is not probable. The breakdown of loans by risk rating as of December 31, 2019 is as follows (dollar amounts in thousands): Pass (1-5) 6 7 8 Total Commercial/industrial $ 290,180 $ 5,329 $ 7,029 $ — $ 302,538 Commercial real estate - owner occupied 422,336 5,603 31,843 — 459,782 Commercial real estate - non-owner occupied 344,278 8,774 671 — 353,723 Construction and development 132,266 — 30 — 132,296 Residential 1‑4 family 447,630 256 719 — 448,605 Consumer 29,430 — 32 — 29,462 Other 10,440 — — — 10,440 $ 1,676,560 $ 19,962 $ 40,324 $ — $ 1,736,846 The breakdown of loans by risk rating as of December 31, 2018 is as follows (dollar amounts in thousands): Pass (1-5) 6 7 8 Total Commercial/industrial $ 277,993 $ 7,309 $ 12,274 $ — $ 297,576 Commercial real estate - owner occupied 375,614 5,670 34,789 24 416,097 Commercial real estate - non-owner occupied 249,625 — 3,092 — 252,717 Construction and development 60,866 — 61 — 60,927 Residential 1‑4 family 364,289 664 3,718 2 368,673 Consumer 26,835 — 18 1 26,854 Other 6,369 — — — 6,369 $ 1,361,591 $ 13,643 $ 53,952 $ 27 $ 1,429,213 The ALL represents management’s estimate of probable and inherent credit losses in the loan portfolio. Estimating the amount of the ALL requires the exercise of significant judgment and the use of estimates related to the amount and timing of expected future cash flows on impaired loans, estimated losses on pools of homogenous loans based on historical loss experience, and consideration of other qualitative factors such as current economic trends and conditions, all of which may be susceptible to significant change. The loan portfolio also represents the largest asset on the consolidated balance sheets. Loan losses are charged off against the ALL, while recoveries of amounts previously charged off are credited to the ALL. A provision for loan losses (“PFLL”) is charged to operations based on management’s periodic evaluation of the factors previously mentioned, as well as other pertinent factors. The ALL consists of specific reserves for certain individually evaluated impaired loans and general reserves for collectively evaluated non-impaired loans. Specific reserves reflect estimated losses on impaired loans from management’s analyses developed through specific credit allocations. The specific reserves are based on regular analyses of impaired, non-homogenous loans greater than $250,000. These analyses involve a high degree of judgment in estimating the amount of loss associated with specific loans, including estimating the amount and timing of future cash flows and collateral values. The general reserve is based in part on the Bank’s historical loss experience which is updated quarterly. The general reserve portion of the ALL also includes consideration of certain qualitative factors such as 1) changes in lending policies and/or underwriting practices, 2) national and local economic conditions, 3) changes in portfolio volume and nature, 4) experience, ability and depth of lending management and other relevant staff, 5) levels of and trends in past-due and nonaccrual loans and quality, 6) changes in loan review and oversight, 7) impact and effects of concentrations and 8) other issues deemed relevant. There are many factors affecting ALL; some are quantitative while others require qualitative judgment. The process for determining the ALL (which management believes adequately considers potential factors which might possibly result in credit losses) includes subjective elements and, therefore, may be susceptible to significant change. To the extent actual outcomes differ from management estimates, additional PFLL could be required that could adversely affect the Corporation’s earnings or financial position in future periods. Allocations of the ALL may be made for specific loans but the entire ALL is available for any loan that, in management’s judgment, should be charged off or for which an actual loss is realized. As an integral part of their examination process, various regulatory agencies review the ALL as well. Such agencies may require that changes in the ALL be recognized when such regulators’ credit evaluations differ from those of management based on information available to the regulators at the time of their examinations. A summary of impaired loans individually evaluated as of December 31, 2019 is as follows (dollar amounts in thousands): Commercial Commercial Real Estate - Real Estate - Construction Commercial / Owner Non-Owner and Residential Industrial Occupied Occupied Development 1-4 Family Consumer Other Total With an allowance recorded: Recorded investment $ 1,878 $ 960 $ — $ — $ — $ — $ — $ 2,838 Unpaid principal balance 1,878 960 — — — — — 2,838 Related allowance 760 80 — — — — — 840 With no related allowance recorded: Recorded investment $ — $ 2,938 $ — $ — $ — $ — $ — $ 2,938 Unpaid principal balance — 2,938 — — — — — 2,938 Related allowance — — — — — — — — Total: Recorded investment $ 1,878 $ 3,898 $ — $ — $ — $ — $ — $ 5,776 Unpaid principal balance 1,878 3,898 — — — — — 5,776 Related allowance 760 80 — — — — — 840 Average recorded investment $ 3,773 $ 5,847 $ — $ — $ 351 $ — $ — $ 9,971 A summary of impaired loans individually evaluated as of December 31, 2018 is as follows (dollar amounts in thousands): Commercial Commercial Real Estate - Real Estate - Construction Commercial / Owner Non-Owner and Residential Industrial Occupied Occupied Development 1‑4 Family Consumer Other Total With an allowance recorded: Recorded investment $ 5,667 $ 2,099 $ — $ — $ 523 $ — $ — $ 8,289 Unpaid principal balance 5,667 2,099 — — 523 — — 8,289 Related allowance 566 353 — — 160 — — 1,079 With no related allowance recorded: Recorded investment $ — $ 5,697 $ — $ — $ 179 $ — $ — $ 5,876 Unpaid principal balance — 5,697 — — 179 — — 5,876 Related allowance — — — — — — — — Total: Recorded investment $ 5,667 $ 7,796 $ — $ — $ 702 $ — $ — $ 14,165 Unpaid principal balance 5,667 7,796 — — 702 — — 14,165 Related allowance 566 353 — — 160 — — 1,079 Average recorded investment $ 2,834 $ 4,036 $ — $ — $ 706 $ — $ — $ 7,576 An analysis of interest income on impaired loans for the years ended December 31 follows (dollar amounts in thousands): 2019 2018 2017 Interest income in accordance with orignial terms $ 651 $ 1,020 $ 113 Interest income recognized (129) (416) (109) Reduction in interest income $ 522 $ 604 $ 4 The following table presents loans acquired with deteriorated credit quality as of December 31, 2019 and 2018. No loans in this table had a related allowance at December 31, 2019 and 2018, and therefore, the below disclosures were not expanded to include loans with and without a related allowance (dollar amounts in thousands). December 31, 2019 December 31, 2018 Recorded Unpaid Principal Recorded Unpaid Principal Investment Balance Investment Balance Commercial & Industrial $ 191 $ 212 $ 555 $ 701 Commercial real estate - owner occupied 518 785 1,558 2,069 Commercial real estate - non-owner occupied — — 233 475 Construction and development 213 237 171 171 Residential 1‑4 family 901 1,031 1,664 1,828 Consumer — — — — Other — — — — $ 1,823 $ 2,265 $ 4,181 $ 5,244 Due to the nature of these loan relationships, prepayment expectations have not been considered in the determination of future cash flows. Management regularly monitors these loan relationships, and if information becomes available that indicates expected cash flows will differ from initial expectations, it may necessitate reclassification between accretable and non-accretable components of the original discount calculation. The following table represents the change in the accretable and non-accretable components of discounts on loans acquired with deteriorated credit quality during the year ended December 31, 2019 and 2018: December 31, 2019 December 31, 2018 Accretable Non-accretable Accretable Non-accretable discount discount discount discount Balance at beginning of period $ 318 $ 745 $ 583 $ 800 Acquired balance, net 44 333 — — Reclassifications between accretable and non-accretable 858 (858) 55 (55) Accretion to loan interest income (998) — (320) — Disposals of loans — — — Balance at end of period $ 222 $ 220 $ 318 $ 745 A troubled debt restructuring (“TDR”) includes a loan modification where a borrower is experiencing financial difficulty and we grant a concession to that borrower that we would not otherwise consider except for the borrower’s financial difficulties. A TDR may be either on accrual or nonaccrual status based upon the performance of the borrower and management’s assessment of collectability. If a TDR is placed on nonaccrual status, it remains there until a sufficient period of performance under the restructured terms has occurred at which time it is returned to accrual status, generally six months. As of December 31, 2019 and 2018 the Corporation had specific reserves of $‑0‑ and $353,000 for TDR’s respectively, and none of them have subsequently defaulted. The following table presents the troubled debt restructurings during the year ended December 31, 2019: Pre-Modification Post-Modification Number of Outstanding Recorded Outstanding Recorded Contracts Investment Investment Commercial & Industrial 1 $ 113 $ 113 Commercial Real Estate 1 61 61 Residential 1-4 Family 2 372 196 Totals $ 546 $ 370 The following table presents the troubled debt restructurings during the year ended December 31, 2018: Pre-Modification Post-Modification Outstanding Outstanding Number of Recorded Recorded Contracts Investment Investment Commerical Real Estate $ 5,396 $ 5,044 |
Related Party Matters
Related Party Matters | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Matters | |
Related Party Matters | Note 5 Related Party Matters Directors, executive officers, and principal shareholders of the Corporation, including their families and firms in which they are principal owners, are considered to be related parties. Loans to officers, directors, and shareholders owning 10% or more of the Corporation, that we are aware of, were made on the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with others and did not involve more than the normal risk of collectability or present other unfavorable features. A summary of loans to directors, executive officers, principal shareholders, and their affiliates for the years ended December 31 is as follows (dollar amounts in thousands): 2019 2018 Balances at beginning $ 84,103 $ 65,749 New loans and advances 27,886 59,684 Repayments (43,435) (41,330) Balance at end $ 68,554 $ 84,103 Deposits from directors, executive officers, principal shareholders, and their affiliates totaled approximately $25,527,000 and $14,127,000 as of December 31, 2019 and 2018, respectively. |
Mortgage Servicing Rights
Mortgage Servicing Rights | 12 Months Ended |
Dec. 31, 2019 | |
Mortgage Servicing Rights | |
Mortgage Servicing Rights | Note 6 Mortgage Servicing Rights Loans serviced for others are not included in the accompanying consolidated balance sheets. MSRs are recognized as separate assets when loans sold in the secondary market are sold with servicing retained. The Corporation utilizes a third party consulting firm to determine an accurate assessment of the mortgage servicing rights fair value. The third party firm collects relevant data points from numerous sources. Some of these data points relate directly to the pricing level or relative value of the mortgage servicing while other data points relate to the assumptions used to derive fair value. In addition, the valuation evaluates specific collateral types, and current and historical performance of the collateral in question. The valuation process focuses on the non-distressed secondary servicing market, common industry practices and current regulatory standards. The primary determinants of the fair value of mortgage servicing rights are servicing fee percentage, ancillary income, expected loan life or prepayment speeds, discount rates, costs to service, delinquency rates, foreclosure losses and recourse obligations. The valuation data also contains interest rate shock analyses for monitoring fair value changes in differing interest rate environments. Following is an analysis of activity for the years ended December 31 in servicing rights assets that are measured at fair value (dollar amounts in thousands): 2019 2018 Fair value at beginning of year $ 3,085 $ 2,610 MSR asset acquired 1,859 — Servicing asset additions 740 356 Loan payments and payoffs (821) (475) Changes in valuation inputs and assumptions used in the valuation model (576) 594 Amount recognized through earnings (592) 475 Fair value at end of year $ 4,287 $ 3,085 Unpaid principal balance of loans serviced for others (in thousands) $ 554,374 $ 316,480 Mortgage servicing rights as a percent of loans serviced for others 0.77 0.97 During the years ended December 31, 2019 and 2018, the Corporation utilized economic assumptions in measuring the initial value of MSRs for loans sold whereby servicing is retained by the Corporation. The economic assumptions used at December 31, 2019 and 2018 included constant prepayment speed of 12.1 and 8.3 months, respectively, and a discount rate of 10.00% for both years. The constant prepayment speeds are obtained from publicly available sources for each of the Federal National Mortgage Association and Federal Home Loan Mortgage Corporation loan programs that the Corporation originates under. The assumptions used by the Corporation are hypothetical and supported by a third party valuation. The Corporation’s methodology for estimating the fair value of MSRs is highly sensitive to changes in assumptions. The carrying value of the mortgage servicing rights is included with intangible assets and approximates fair market value at December 31, 2019 and 2018. Changes in fair value are recognized through the income statement as loan servicing income. |
Premises and Equipment
Premises and Equipment | 12 Months Ended |
Dec. 31, 2019 | |
Premises and Equipment | |
Premises and Equipment | Note 7 Premises and Equipment An analysis of premises and equipment at December 31 follows (dollar amounts in thousands): 2019 2018 Land and land improvements $ 4,584 $ 3,363 Buildings and building improvements 31,754 23,408 Furniture and equipment 5,360 6,177 Totals 41,698 32,948 Less accumulated depreciation 8,111 8,459 Right-of-use lease asset (see Note 21) 1,699 — Premises and equipment, net $ 35,286 $ 24,489 Included in buildings and improvements at December 31, 2019 and 2018, is $6,169,000 and $764,000, respectively, in construction in progress. These amounts relate to branch locations which were under construction. These balances begin accumulating depreciation upon being placed in service. Depreciation and amortization of premises and equipment charged to operating expense totaled approximately $1,272,000, $1,116,000, and $1,126,000 for the years ended December 31, 2019, 2018, and 2017, respectively. |
Other Real Estate Owned
Other Real Estate Owned | 12 Months Ended |
Dec. 31, 2019 | |
Other Real Estate Owned | |
Other Real Estate Owned | Note 8 Other Real Estate Owned Changes in OREO for the years ended December 31 were as follows (dollar amounts in thousands): 2019 2018 Beginning of year $ 3,592 $ 6,270 Transfers in 4,927 1,310 Gain (loss) on sale of OREO and valuation allowance 73 (252) Sales (1,704) (3,736) End of year $ 6,888 $ 3,592 Activity in the valuation allowance for the years ended December 31 was as follows (dollar amounts in thousands): 2019 2018 2017 Beginning of year $ 2,208 $ 2,078 $ 2,094 Additions charged to expense 13 130 — Valuation relieved due to sale of OREO (100) — (16) End of year $ 2,121 $ 2,208 $ 2,078 As of December 31, 2019, the recorded investment of consumer mortgage loans secured by residential real estate properties for which formal foreclosure proceedings are in process was $408,000. |
Investment in Minority-owned Su
Investment in Minority-owned Subsidiaries | 12 Months Ended |
Dec. 31, 2019 | |
Investment in Minority-owned Subsidiaries | |
Investment in Minority-owned Subsidiaries | Note 9 Investment in Minority-owned Subsidiaries The Corporation has a 49.8% membership interest in UFS. The business operations of UFS consist of providing data processing and other information technology services to the Corporation and other financial institutions. As of December 31, 2019 and 2018, UFS had total assets of $25,489,000 and $22,140,000 and liabilities of $3,661,000 and $1,905,000, respectively. The Corporation’s investment in UFS was $10,732,000 and $10,005,000 at December 31, 2019 and 2018, respectively. The investment is accounted for on the equity method. The Corporation’s undistributed earnings from its investment in UFS were approximately $2,935,000, $2,563,000, and $2,390,000 for the years ended December 31, 2019, 2018 and 2017, respectively. Data processing service fees paid by the Corporation to UFS were approximately $3,248,000 $2,514,000, and $2,069,000 for the years ended December 31, 2019, 2018 and 2017, respectively. The Corporation has a contract with UFS that was renewed for five years on January 1, 2018. The Corporation’s proportionate share of earnings of UFS flow through to its tax return. Deferred income taxes of approximately $1,124,000 and $939,000 were provided to account for the difference in the tax and book basis of assets and liabilities held at UFS at December 31, 2019 and 2018, respectively. During 2019, 2018 and 2017, the Corporation received $2,108,000, $1,505,000 and $915,000 in dividends from UFS, respectively. TVG, the insurance subsidiary of the Bank, maintained a 40.0% investment in Ansay at December 31, 2019, an increase from 30.0% at December 31, 2018 due to a purchase of member interest on October 1, 2019. Ansay is an independent insurance agency that has operated in southeastern Wisconsin since 1946, managing the insurance and risk needs of commercial and personal insurance clients in Wisconsin and the Midwest. As of December 31, 2019 and 2018, Ansay had total assets of $79,781,000 and $63,951,000 and liabilities of $42,838,000 and $45,289,000, respectively. The Corporation’s investment in Ansay, which is accounted for using the equity method, was $29,555,000 and $15,392,000 at December 31, 2019 and 2018, respectively. The Corporation recognized undistributed earnings of approximately $1,792,000, $2,114,000 and $1,663,000 and received dividends of $1,329,000, $1,432,000 and $964,000 from its investment in Ansay during the years ended December 31, 2019, 2018 and 2017, respectively. As of December 31, 2019 and 2018, Ansay had term loans with the Bank totaling approximately $19,124,000 and $21,799,000, respectively. Ansay has an available revolving line of credit of $1,000,000 with the Corporation with $367,000 outstanding as of December 31, 2019. Ansay maintained deposits at the Bank totaling $17,495,000 and $6,009,000 as of December 31, 2019 and 2018, respectively. The CEO of Ansay, Michael G. Ansay, serves as Chairman of the Board of the Corporation. As a related party, during 2019, 2018 and 2017 the Corporation purchased director and officer fidelity bond and commercial insurance coverage through Ansay spending approximately $225,000, $165,000 and $164,000, respectively. The Corporation’s proportionate share of earnings of Ansay flow through to its tax return. Deferred income taxes of approximately $1,385,000 and $1,299,000 were provided to account for the difference in the tax and book basis of assets and liabilities held at Ansay as of December 31, 2019 and 2018, respectively. |
Identifiable Intangible Assets
Identifiable Intangible Assets | 12 Months Ended |
Dec. 31, 2019 | |
Identifiable Intangible Assets | |
Identifiable Intangible Assets | Note 10 Identifiable Intangible Assets The gross carrying amount and accumulated amortization of intangible assets (excluding goodwill) for the years ended December 31 are as follows (dollar amounts in thousands): 2019 2018 Gross Intangible Gross Intangible Carrying Accumulated Carrying Accumulated Amount Amortization Amount Amortization Core deposit intangible $ 7,333 $ 1,954 $ 3,097 $ 885 Mortgage servicing rights 4,287 — 3,085 — Totals $ 11,620 $ 1,954 $ 6,182 $ 885 Amortization expense was $1,069,000, $756,000 and $132,000 for the years ended December 31, 2019, 2018 and 2017, respectively. Mortgage servicing rights are carried at fair value; therefore, there is no amortization expense. The following table shows the estimated future amortization expense of amortizing intangible assets. The projections of amortization expense are based on existing asset balances as of December 31, 2019 (dollar amounts in thousands): Core Deposit Intangible 2020 $ 1,335 2021 1,130 2022 925 2023 720 2024 516 Thereafter 753 Total $ 5,379 |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Note 11 Goodwill Goodwill was $43,456,000 at December 31, 2019 and $15,024,000 at December 31, 2018. As detailed in Note 2, there were additions to the carrying amount of goodwill in 2019 of approximately $28,432,000 related to the Partnership acquisition. |
Deposits
Deposits | 12 Months Ended |
Dec. 31, 2019 | |
Deposits | |
Deposits | Note 12 Deposits The composition of deposits at December 31 is as follows (dollar amounts in thousands): 2019 2018 Noninterest-bearing demand deposits $ 476,465 $ 448,765 Interest-bearing demand deposits 184,843 92,107 Savings deposits 792,997 616,138 Time deposits 373,430 382,450 Brokered certificates of deposit 15,576 17,707 Total deposits $ 1,843,311 $ 1,557,167 Time deposits of $250,000 or more were approximately $55,948,000 and $81,663,000 at December 31, 2019 and 2018, respectively. The scheduled maturities of time deposits at December 31, 2019, are summarized as follows (dollar amounts in thousands): 2020 $ 214,360 2021 113,074 2022 25,955 2023 25,161 2024 7,858 Thereafter 2,598 Total $ 389,006 |
Securities Sold Under Repurchas
Securities Sold Under Repurchase Agreements | 12 Months Ended |
Dec. 31, 2019 | |
Securities Sold Under Repurchase Agreements | |
Securities Sold Under Repurchase Agreements | Note 13 Securities Sold Under Repurchase Agreements Securities sold under repurchase agreements have contractual maturities up to one year from the transaction date with variable and fixed rate terms. The agreements to repurchase securities require that the Corporation (seller) repurchase identical securities as those that are sold. The securities underlying the agreements were under the Corporation’s control. Information concerning securities sold under repurchase agreements at December 31 consists of the following (dollar amounts in thousands): 2019 2018 2017 Outstanding balance at the end of the year $ 45,865 $ 31,489 $ 47,568 Weighted average interest rate at the end of the year 1.47 % 2.43 % 1.44 % Average balance during the year $ 21,522 $ 22,315 $ 26,537 Average interest rate during the year 2.14 % 1.79 % 1.01 % Maximum month end balance during the year $ 45,865 $ 48,010 $ 53,745 |
Notes Payable
Notes Payable | 12 Months Ended |
Dec. 31, 2019 | |
Notes Payable [Abstract] | |
Notes Payable | Note 14 Notes Payable There were $39,800,000 and $-0- of advances outstanding from the FHLB at December 31, 2019 and 2018, respectively. At December 31, 2019, $1,400,000 of these borrowings mature within twelve months and are considered short-term, with the remaining $38,400,000 considered long-term. From time to time the Bank utilized additional short-term FHLB advances to fund liquidity during these years. The advances, rate, and maturities of FHLB advances as of December 31 were as follows: Maturity Rate 2019 2018 (dollars in thousands) Fixed rate, fixed term 01/27/2020 1.42 % $ 1,000 $ — Fixed rate, fixed term 11/02/2020 1.28 % 400 — Fixed rate, fixed term 01/22/2021 1.67 % 2,000 — Fixed rate, fixed term 01/25/2021 2.37 % 5,000 — Fixed rate, fixed term 01/27/2021 1.60 % 1,000 — Fixed rate, fixed term 11/03/2021 1.46 % 400 — Fixed rate, fixed term 08/08/2022 1.76 % 10,000 — Fixed rate, fixed term 08/08/2023 1.74 % 10,000 — Fixed rate, fixed term 08/08/2024 1.75 % 10,000 — $ 39,800 $ — Future maturities of borrowings at December 31, 2019, were as follows (dollars in thousands): 2020 $ 1,400 2021 8,400 2022 10,000 2023 10,000 2024 10,000 $ 39,800 At December 31, 2019 and 2018, respectively, total loans available to be pledged as collateral on FHLB borrowings were approximately $815,200,000 and $697,300,000 and, of that total, $373,100,000 and $316,200,000 qualified as eligible collateral. The Bank owned $2,230,000 and $1,700,000 of FHLB stock at December 31, 2019 and 2018, respectively. In addition to the fixed rate, fixed term advances noted above, as of December 31, 2019 and 2018, the Bank had $14,400,000 and $55,000,000 of credit outstanding from the FHLB, respectively, which consisted entirely of letters of credit. At December 31, 2019 and 2018, the Bank had available liquidity of $318,900,000 and $261,200,000 for future draws, respectively. FHLB stock is included in other investments at December 31, 2019 and 2018. This stock is recorded at cost, which approximates fair value. The Corporation maintains a $5,000,000 line of credit with a commercial bank. There were outstanding balances on this note of $5,000,000 as of December 31,2019. There were no outstanding balances on this note at December 31, 2018. Borrowings under this note carry interest at a variable rate with a floor of 3.50% (4.05% at December 31, 2019), due in full on May 25, 2020. The Corporation maintains a $5,000,000 line of credit with another commercial bank. There were outstanding balances on this note of $5,000,000 as of December 31, 2019. There were no outstanding balances on this note at December 31, 2018. Borrowings under this note carry interest at a variable rate with a floor of 3.25% (4.05% at December 31, 2019), due in full on May 19, 2020. |
Subordinated Debt
Subordinated Debt | 12 Months Ended |
Dec. 31, 2019 | |
Subordinated Borrowings [Abstract] | |
Subordinated Debt | Note 15 Subordinated Debt During September 2017, the Corporation entered into subordinated note agreements with three separate commercial banks. The Corporation had up to twelve months from entering these agreements to borrow funds up to a maximum availability of $22,500,000. As of December 31, 2019 and 2018, the Corporation had borrowed $11,500,000 under these agreements. These notes were all issued with 10‑year maturities, carry interest at a variable rate payable quarterly, are callable on or after the sixth anniversary of their issuance dates, and qualify for Tier 2 capital for regulatory purposes. As part of the Partnership acquisition, the Corporation assumed a subordinated note agreement with an outstanding balance of $7,000,000, and a fair market value adjustment of $195,000. The note matures on October 1, 2025, requires quarterly interest-only payments at a rate of 7.1% prior to maturity, and can be prepaid without penalty after October 1, 2020. This note qualifies for Tier 2 capital for regulatory purposes. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Taxes | |
Income Taxes | Note 16 Income Taxes The components of the provision for income taxes for the years ended December 31 are as follows (dollar amounts in thousands): 2019 2018 2017 Current tax expense: Federal $ 4,327 $ 3,349 $ 6,340 State 2,412 2,100 1,862 Total current 6,739 5,449 8,202 Deferred tax expenses (benefit): Impact of change in tax rate from tax legislation — — 642 Federal 620 815 (12) State 236 333 (6) Total deferred 856 1,148 624 Total provision for income taxes $ 7,595 $ 6,597 $ 8,826 A summary of the sources of differences between income taxes at the federal statutory rate and the provision for income taxes for the years ended December 31 follows (dollar amounts in thousands): 2019 2018 2017 Tax expense at statutory rate $ 7,201 $ 6,731 $ 8,449 Increase (decrease) in taxes resulting from: Tax-exempt interest (1,320) (1,105) (1,279) State taxes (net of Federal benefit) 1,923 1,674 1,210 Cash surrender value of life insurance (131) (128) (192) ESOP dividend (93) (81) (121) Tax credits (39) (91) (117) Nondeductible expenses associated with acquisition — — 160 Deferred tax rate differential from tax legislation — — 642 Other 54 (403) 74 Total provision for income taxes $ 7,595 $ 6,597 $ 8,826 Deferred income taxes are provided for the temporary differences between the financial reporting basis and the tax basis of the Corporation’s assets and liabilities. Deferred taxes are included in other liabilities of the balance sheet. The major components of the net deferred tax asset (liability) as of December 31 are presented below (dollar amounts in thousands): 2019 2018 Deferred tax assets: Deferred compensation $ 1,036 $ 1,089 Premises and equipment 398 214 Allowance for loan losses 3,104 3,336 Accrued vacation and severance 35 36 Other real estate owned 360 352 Unrealized loss on securities available for sale — 97 Other 244 95 Total deferred tax assets 5,177 5,219 Deferred tax liabilities: Investment in acquisition and discount accretion (148) (162) Mortgage servicing rights (1,168) (840) Other investments (248) (209) Prepaid expenses (63) (66) Investment in minority owned subsidiaries (2,509) (2,238) Goodwill and other intangibles (1,000) (1,049) Purchase accounting (339) — Unrealized gain on securities available for sale (743) — Total deferred tax liabilities (6,218) (4,564) Net deferred tax (liability) asset $ (1,041) $ 655 Tax effects from an uncertain tax position can be recognized in the financial statements only if the position is more likely than not to be sustained on audit, based on the technical merits of the position. The Corporation recognizes the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the more likely than not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the relevant tax authority. When applicable, interest and penalties on uncertain tax positions are calculated based on the guidance from the relevant tax authority and included in income tax expense. At December 31, 2019 and 2018, there was no liability for uncertain tax positions. Federal income tax returns for 4 years ended December 31, 2016 through 2019 remain open and subject to review by applicable tax authorities. State income tax returns for 5 years ended December 31, 2015 through 2019 remain open and subject to review by applicable tax authorities. On December 22, 2017, the President of the United States signed the Tax Cuts and Jobs Act which, among other provisions, reduced the corporate income tax rate from 35% to 21%. As a result, the Corporation recorded a write down to its net deferred tax asset of approximately $642,000 as of December 31, 2017. The write down resulted in an equivalent increase in tax expense. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2019 | |
Employee Benefit Plans | |
Employee Benefit Plans | Note 17 Employee Benefit Plans Employee Stock Ownership Plan The Corporation has a defined contribution profit sharing 401(k) plan which includes the provisions for an employee stock ownership plan (“ESOP”). The plan is available to all employees over 18 years of age after completion of three months of service. Employees participating in the plan may elect to defer a minimum of 2% of compensation up to the limits specified by law. All participants of the 401(k) plan are eligible for the ESOP and may allocate their contributions to purchase shares of the Corporation’s stock. As of December 31, 2019 and 2018, the plan held 432,795 and 502,963 shares, respectively. These shares are included in the calculation of the Corporation’s earnings per share. The Corporation may make discretionary contributions up to the limits established by IRS regulations. The discretionary match was 35% of participant contributions up to 10% of the employee’s salary in 2019, 2018, and 2017. The Corporation made additional discretionary contributions to the plan of $505,000, $656,000, $532,000 in 2019, 2018 and 2017, respectively. Total expense associated with the plans was approximately $ 957,000, $1,061,000 and $842,000 in 2019, 2018 and 2017, respectively. Share-based Compensation The Corporation has made restricted share grants during 2019, 2018 and 2017 pursuant to the Bank First National Corporation 2011 Equity Plan. The purpose of the Plan is to provide financial incentives for selected employees and for the non-employee Directors of the Corporation, thereby promoting the long-term growth and financial success of the Corporation. The Corporation stock to be offered under the Plan pursuant to Stock Appreciation Rights (“SAR”), performance unit awards, and restricted stock and unrestricted Corporation stock awards must be Corporation stock previously issued and outstanding and reacquired by the Corporation. The number of shares of Corporation stock that may be issued pursuant to awards under the Plan shall not exceed, in the aggregate, 659,250. As of December 31, 2019, 177,462 shares of Corporation stock has been awarded under the Plan. Compensation expense for restricted stock is based on the fair value of the awards of Bank First Corporation common stock at the time of grant. The value of restricted stock grants that are expected to vest is amortized into expense over the vesting periods. For the year ended December 31, 2019, 2018 and 2017, compensation expense of $685,000, $556,000 and $ 465,000, respectively, was recognized related to restricted stock awards. As of December 31, 2019, there was $1, 548 ,000 of unrecognized compensation cost related to non-vested restricted stock awards granted under the plan. That cost is expected to be recognized over a weighted average period of 2.65 years. The aggregate grant date fair value of restricted stock awards that vested during 2019 was approximately $ 526,000. For the year ended For the year ended December 31, 2019 December 31, 2018 Weighted- Weighted- Average Grant- Average Grant- Shares Date Fair Value Shares Date Fair Value Restricted Stock Outstanding at beginning of year 51,776 $ 34.27 53,619 $ 26.59 Granted 17,015 56.62 17,982 46.55 Vested (17,212) 30.54 (19,825) 24.36 Forfeited or cancelled (903) 41.01 — — Outstanding at end of year 50,676 $ 43.03 51,776 $ 34.27 Deferred Compensation Plan The Corporation has a deferred compensation agreement with one of its former executive officers. The benefits were payable beginning June 30, 2009, the date of termination of employment with the Corporation via retirement. The estimated annual cash benefit payment upon retirement at the age of 70 under the salary continuation plan is $108,011. The payoff is for the participant’s lifetime and is guaranteed to the participant or their surviving beneficiary for a minimum of 15 years. Related expense for this agreement was approximately $ 23,000, $28,000, and $31,000 for the years ended December 31, 2019, 2018 and 2017, respectively. The vested present value of future payments of approximately $ 437,000 and $521,000 at December 31, 2019 and 2018, respectively, is included in other liabilities. During 2019 and 2018 the discount rate used to present value the future payments of this obligation was 4.95%. The Corporation had a nonqualified deferred compensation plan which permitted eligible participants to defer a portion of their compensation. The benefits were generally payable beginning with the earlier of attaining age 70 or resignation from the Corporation. During 2017, this plan was amended to require that benefits paid from the plan be paid in shares of common stock of the Corporation. Prior to this amendment, benefit distributions could be paid either in shares of common stock, or a cash distribution equal to the accumulated value of the benefits owed. As of December 31, 2019 and 2018, the obligations under this plan were valued at $3, 368 ,000 and $3, 477,000, respectively, and were included in other liabilities. Expense associated with this plan was approximately $144,000 in 2017. There was no expense associated with this plan during 2019 or 2018. On February 19, 2019, the Board of Directors of Bank First Corporation approved the termination of the Bank First National Amended and Restated Nonqualified Deferred Compensation Plan, effective March 1, 2019. As a result of this termination, all benefits owed must be paid no sooner than one year and no later than two years following the termination. |
Stockholders' Equity and Regula
Stockholders' Equity and Regulatory Matters | 12 Months Ended |
Dec. 31, 2019 | |
Stockholders' Equity and Regulatory Matters | |
Stockholders' Equity and Regulatory Matters | Note 18 Stockholders’ Equity and Regulatory Matters The Bank, as a national bank, is subject to the dividend restrictions set forth by the Office of the Comptroller of the Currency. Under such restrictions, the Bank may not, without the prior approval of the Office of the Comptroller of the Currency, declare dividends in excess of the sum of the current year’s earnings (as defined) plus the retained earnings (as defined) from the prior two years. The dividends that the Bank could declare without the prior approval of the Office of the Comptroller of the Currency as of December 31, 2019 totaled approximately $28,100,000. The payment of dividends may be further limited because of the need for the Bank to maintain capital ratios satisfactory to applicable regulatory agencies. Banks and certain bank holding companies are subject to regulatory capital requirements administered by federal banking agencies. Capital adequacy guidelines and , additionally for banks, prompt corrective action regulations involve quantitative measures of assets, liabilities, and certain off-balance sheet items calculated under regulatory accounting practices. Capital amounts and classifications are also subject to qualitative judgments by regulators. Failure to meet capital requirements can initiate regulatory action. The Economic Growth, Regulatory Relief, and Consumer Protection Act, signed into law in May 2018 raised the threshold for those bank holding companies subject to the Federal Reserve's Small Bank Holding Company Policy Statement to $3 billion. As a result, as of the effective date of that change in 2018, the Corporation was no longer required to comply with the risk-based capital rules applicable to the Bank. The Federal Reserve may, however, require smaller bank holding companies to maintain certain minimum capital levels, depending upon general economic conditions and a bank holding company's particular condition, risk profile and growth plans. Under regulatory guidance for non-advanced approaches institutions, the Bank is required to maintain minimum amounts and ratios of common equity Tier I capital to risk-weighted assets. Additionally, under Basel III rules, the decision was made to opt-out of including accumulated other comprehensive income in regulatory capital. As of December 31, 2019 and 2018, the Bank met all capital adequacy requirements to which they are subject. Beginning in 2016, an additional conservation buffer was added to the minimum requirements for capital adequacy purposes , subject to a three year phase-in period. As of December 31,2018, the buffer was 1.88%. The capital conservation buffer was fully phased in January 1, 2019 at 2.50%. Actual and required capital amounts and ratios are presented below (dollar amounts in thousands): To Be Well Minimum Capital Capitalized Under For Capital Adeqaucy with Prompt Corrective Actual Adequacy Purposes Capital Buffer Action Provisions Amount Ratio Amount Ratio Amount Ratio Amount Ratio December 31, 2019 Total capital (to risk-weighted assets): Corporation $ 208,900 10.35 % NA NA NA NA NA NA Bank $ 215,347 10.69 % $ 161,163 8.00 % $ 211,527 10.50 % $ 201,454 10.00 % Tier 1 capital (to risk-weighted assets): Corporation $ 178,882 8.86 % NA NA NA NA NA NA Bank $ 203,951 10.12 % $ 120,872 6.00 % $ 171,236 8.50 % $ 161,163 8.00 % Common Equity Tier 1 capital (to risk-weighted assets): Corporation $ 178,882 8.86 % NA NA NA NA NA NA Bank $ 203,951 10.12 % $ 90,654 4.50 % $ 141,018 7.00 % $ 130,945 6.50 % Tier 1 capital (to average assets): Corporation $ 178,882 8.46 % NA NA NA NA NA NA Bank $ 203,951 9.67 % $ 84,390 4.00 % $ 84,390 4.00 % $ 105,487 5.00 % To Be Well Minimum Capital Capitalized Under For Capital Adequacy with Prompt Corrective Actual Adequacy Purposes Capital Buffer Action Provisions Amount Ratio Amount Ratio Amount Ratio Amount Ratio December 31, 2018 Total capital (to risk-weighted assets): Corporation $ 181,201 11.35 % NA NA NA NA NA NA Bank $ 178,668 11.21 % $ 127,497 8.00 % $ 157,459 9.88 % $ 159,372 10.00 % Tier 1 capital (to risk-weighted assets): Corporation $ 157,453 9.86 % NA NA NA NA NA NA Bank $ 166,420 10.44 % $ 95,623 6.00 % $ 125,585 7.88 % $ 127,497 8.00 % Common Equity Tier 1 capital (to risk-weighted assets): Corporation $ 157,453 9.86 % NA NA NA NA NA NA Bank $ 166,420 10.44 % $ 71,717 4.50 % $ 101,679 6.38 % $ 103,592 6.50 % Tier 1 capital (to average assets): Corporation $ 157,453 9.06 % NA NA NA NA NA NA Bank $ 166,420 9.59 % $ 69,410 4.00 % 69,410 4.00 % $ 86,762 5.00 % |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2019 | |
Segment Information | |
Segment Information | Note 19 Segment Information The Corporation, through the branch network of its subsidiary, the Bank, provides a full range of consumer and commercial financial institution services to individuals and businesses in Wisconsin. These services include credit cards; secured and unsecured consumer, commercial, and real estate loans; demand, time, and savings deposits; and ATM processing. The Corporation also offers a full-line of insurance services through its equity investment in Ansay and offers data processing services through its equity investment in UFS. While the Corporation’s chief decision makers monitor the revenue streams of various Corporation products and services, operations are managed and financial performance is evaluated on a Corporation-wide basis. Accordingly, all of the Corporation’s financial institution operations are considered by management to be aggregated in one reportable operating segment. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies | |
Commitments and Contingencies | Note 20 Commitments and Contingencies The Corporation enters into commitments to originate loans whereby the interest rate on the loan is determined prior to funding (rate lock commitments). Rate lock commitments on mortgage loans that are intended to be sold are considered to be derivatives. Accordingly, such commitments, along with any related fees received from potential borrowers, are recorded at fair value in derivative assets or liabilities, with changes in fair value recorded in the net gain or loss on sale of mortgage loans. Fair value is based on fees currently charged to enter into similar agreements and for fixed rate commitments also considers the difference between current levels of interest rates and committed rates. The notional amount of rate lock commitments at December 31, 2019 and 2018, respectively, was $ 14,793,000 and $3,314,000. The Bank is party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the consolidated balance sheets. The Bank’s exposure to credit loss is represented by the contractual or notional amount of these commitments. The Bank follows the same credit policies in making commitments as it does for on-balance-sheet instruments. Since some of the commitments are expected to expire without being drawn upon and some of the commitments may not be drawn upon to the total extent of the commitment, the notional amount of these commitments does not necessarily represent future cash requirements. The following commitments were outstanding at December 31 (dollar amounts in thousands): Notional Amount 2019 2018 Commitments to extend credit: Fixed $ 49,741 $ 57,911 Variable 333,468 268,541 Credit card arrangements 11,148 7,119 Letters of credit 17,121 25,261 Commitments to extend credit are agreements to lend to a customer at fixed or variable rates as long as there is no violation of any condition established in the contract. Commitments have fixed expiration dates or other termination clauses and may require payment of a fee. The amount of collateral obtained upon extension of credit is based on management’s credit evaluation of the customer. Collateral held varies but may include accounts receivable; inventory; property, plant, and equipment; real estate; and stocks and bonds. Letters of credit include $11,492,000 of direct pay letters of credit and $5,629,000 of standby letters of credit. Direct pay letters of credit generally are issued to support the marketing of industrial development revenue and housing bonds and provide that all debt service payments will be paid by drawing on the letter of credit. The letter of credit draws are then repaid by draws from the customer’s bank account. Standby letters of credit are conditional lending commitments issued by the Corporation to guaranty the performance of a customer to a third party. Generally, all standby letters of credit issued have expiration dates within one year. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. The Corporation generally holds collateral supporting these commitments. The majority of the Corporation’s loans, commitments, and letters of credit have been granted to customers in the Corporation’s market area. The concentrations of credit by type are set forth in Note 4. Standby letters of credit were granted primarily to commercial borrowers. Management believes the diversity of the local economy will prevent significant losses in the event of an economic downturn. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases | |
Leases | Note 21 Leases In February 2016, the FASB established Topic 842, Leases, by issuing ASU No. 2016-02, which requires lessees to recognize leases on-balance sheet and disclose key information about leasing arrangements. Subsequently, amendments ASU No. 2018-01, Land Easement Practical Expedient for Transition to Topic 842; ASU No. 2018-10, Codification Improvements to Topic 842, Leases; and ASU No. 2018- 11, Targeted Improvements were issued. ASC 842 establishes a right-of-use (“ROU”) model that requires a lessee to recognize a ROU lease asset and liability on the balance sheet for all leases with a term longer than 12 months. Leases are classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement. The Corporation leases certain properties under operating leases that resulted in the initial recognition of ROU lease assets of approximately $1,699,000 and corresponding lease liabilities of the same value on the Corporation’s Consolidated Balance Sheets. ASC 842 was effective on January 1, 2019. A modified retrospective transition approach is required, applying the new standard to all leases existing at the date of initial application. The Corporation chose to use the effective date approach. As such, all periods presented after January 1, 2019 are under ASC 842 whereas periods presented prior to January 1, 2019 are in accordance with prior lease accounting of ASC 840. Financial information was not updated and the disclosures required under ASC 842 was not provided for dates and periods before January 1, 2019. ASC 842 provides a number of optional practical expedients in transition. The Corporation has elected the ‘package of practical expedients,’ which permits the Corporation not to reassess under the new standard the prior conclusions about lease identification, lease classification and initial direct costs. The Corporation also elected the use of the hindsight, a practical expedient which permits the use of information available after lease inception to determine the lease term via the knowledge of renewal options exercised not available as of the leases inception. The practical expedient pertaining to land easements is not applicable to the Corporation. ASC 842 also requires certain accounting elections for ongoing application of ASC 842. The Corporation elected the short-term lease recognition exemption for all leases that qualify, meaning those with terms under twelve months. ROU assets or lease liabilities are not to be recognized for short-term leases. The Corporation also elected the practical expedient to not separate lease and non-lease components for all leases, the majority of which consist of real estate common area maintenance expenses. However, since these non-lease items are subject to change, they are treated and disclosed as variable payments in the quantitative disclosures below. Consequently, ASC 842’s changed guidance on contract components will not significantly affect our financial reporting. Similarly, ASC 842’s narrowed definition of initial direct costs will not significantly affect financial reporting. Lessee Leases The Corporation’s lessee leases are operating leases, and consist of leased real estate for branches. Options to extend and renew leases are generally exercised under normal circumstances. Advance notification is required prior to termination, and any noticing period is often limited to the months prior to renewal. Rent escalations are generally specified by a payment schedule, or are subject to a defined formula. The Corporation also elected the practical expedient to not separate lease and non-lease components for all leases, the majority of which consist of real estate common area maintenance expenses. Generally, leases do not include guaranteed residual values, but instead typically specify that the leased premises are to be returned in satisfactory condition with the Corporation liable for damages. For operating leases, the lease liability and ROU asset (before adjustments) are recorded at the present value of future lease payments. ASC 842 requires the use of the lease interest rate; however, this rate is typically not known. As an alternative, ASC 842 permits the use of an entity’s fully secured incremental borrowing rate. The Corporation is electing to utilize the Wall Street Journal Prime Rate on the date of lease commencement. Year ended December 31, 2019 (dollar amounts in Thousands) Amortization of ROU Assets - Operating Leases $ 45 Interest on Lease Liabilities - Operating Leases 87 Operating Lease Cost (Cost resulting from lease payments) 132 New ROU Assets - Operating Leases 1,744 Weighted Average Lease Term (Years) - Operating Leases 31.56 Weighted Average Discount Rate - Operating Leases 5.50 % A maturity analysis of operating lease liabilities and reconciliation of the undiscounted cash flows to the total operating lease liabilities as of December 31, 2019 is as follows (dollar amounts in thousands): December 31, 2019 Operating lease payments due: Within one year $ 133 After one but within two years 140 After two but within three years 113 After three but within four years 86 After four years but within five years 86 After five years 3,411 Total undiscounted cash flows 3,969 Discount on cash flows (2,270) Total operating lease liabilities $ 1,699 |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value of Financial Instruments | |
Fair Value of Financial Instruments | Note 22 Fair Value of Financial Instruments Accounting guidance establishes a fair value hierarchy to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value. Level 1: Quoted prices (unadjusted) or identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date. Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability. Information regarding the fair value of assets measured at fair value on a recurring basis is as follows (dollar amounts in thousands): Instruments Markets Other Significant Measured for Identical Observable Unobservable At Fair Assets Inputs Inputs Value (Level 1) (Level 2) (Level 3) December 31, 2019 Assets Securities available for sale Obligations of U.S.Government sponsored agencies $ 12,060 $ — $ 12,060 $ — Obligations of states and political subdivisions 54,771 — 54,771 — Mortgage-backed securities 51,720 — 51,720 — Corporate notes 62,955 — 62,955 — Mortgage servicing rights 4,287 — 4,287 — December 31, 2018 Assets Securities available for sale Obligations of states and political subdivisions $ 51,893 $ — $ 51,493 $ 400 Mortgage-backed securities 50,569 — 50,569 — Corporate notes 16,444 — 16,444 — Mortgage servicing rights 3,085 — 3,085 — Fair value of assets measured on a recurring basis using significant unobservable inputs (Level 3) are as follows (dollar amounts in thousands): 2019 2018 Total securities at beginning of year $ 400 $ 500 Included in earnings — — Included in other comprehensive income — — Purchases, issuance, and settlements (400) (100) Transfer in and/or out of level 3 — — Total securities at end of year $ — $ 400 Information regarding the fair value of assets measured at fair value on a non-recurring basis is as follows (dollar amounts in thousands): Quoted Prices In Active Significant Assets Markets Other Significant Measured for Identical Observable Unobservable At Fair Assets Inputs Inputs Value (Level 1) (Level 2) (Level 3) December 31, 2019 OREO $ 6,888 $ — $ — $ 6,888 Impaired Loans, net of impairment reserve 6,847 — — 6,847 $ 13,735 $ — $ — $ 13,735 December 31, 2018 OREO $ 3,592 $ — $ — $ 3,592 Impaired Loans, net of impairment reserve 20,872 — — 20,872 $ 24,464 $ — $ — $ 24,464 The following is a description of the valuation methodologies used by the Corporation for the items noted in the table above, including the general classification of such instruments in the fair value hierarchy. For individually evaluated impaired loans, the amount of impairment is based upon the present value of expected future cash flows discounted at the loan’s effective interest rate, the estimated fair value of the underlying collateral for collateral-dependent loans, or the estimated liquidity of the note. For OREO, the fair value is based upon the estimated fair value of the underlying collateral adjusted for the expected costs to sell. The following table shows significant unobservable inputs used in the fair value measurement of Level 3 assets: Weighted Range of Average Valuation Technique Unobservable Inputs Discounts Discount As of December 31, 2019 OREO Third party appraisals, sales contracts or brokered price opinions Collateral discounts and estimated costs to sell 0% - 61 % 33.5 % Impaired loans Third party appraisals and discounted cash flows Collateral discounts and discount rates 0% - 100 % 6.1 % As of December 31, 2018 OREO Third party appraisals, sales contracts or brokered price opinions Collateral discounts and estimated costs to sell 0% - 40 % 18.6 % Impaired loans Third party appraisals and discounted cash flows Collateral discounts and discount rates 0% - 100 % 9.3 % The following methods and assumptions were used by the Corporation to estimate fair value of financial instruments. Cash and cash equivalents - Fair value approximates the carrying amount. Securities - The fair value measurement is obtained from an independent pricing service and is based on recent sales of similar securities and other observable market data. Loans held for sale - Fair value is based on commitments on hand from investors or prevailing market prices. Loans - Fair value of variable rate loans that reprice frequently are based on carrying value. Fair value of other loans is estimated by discounting future cash flows using current rates at which similar loans would be made to borrowers with similar credit ratings. Fair value of impaired and other nonperforming loans are estimated using discounted expected future cash flows or the fair value of the underlying collateral, if applicable. Other investments - The carrying amount reported in the consolidated balance sheets for other investments approximates the fair value of these assets. Mortgage servicing rights - Fair values were determined using the present value of future cash flows. Cash value of life insurance - The carrying amount approximates its fair value. Deposits - Fair value of deposits with no stated maturity, such as demand deposits, savings, and money market accounts, by definition, is the amount payable on demand on the reporting date. Fair value of fixed-rate time deposits is estimated using discounted cash flows applying interest rates currently offered on similar time deposits. Securities sold under repurchase agreements - The fair value of securities sold under repurchase agreements with variable rates or due on demand is the amount payable at the reporting date. The fair value of securities sold under repurchase agreements with fixed terms is estimated using discounted cash flows with discount rates at interest rates currently offered for securities sold under repurchase agreements of similar remaining values. Notes payable and Subordinated notes - Rates currently available to the Corporation for debt with similar terms and remaining maturities are used to estimate fair value of existing debt. Fair value of borrowings is estimated by discounting future cash flows using the current rates at which similar borrowings would be made. Fair value of borrowed funds due on demand is the amount payable at the reporting date. Off-balance-sheet instruments - Fair value is based on quoted market prices of similar financial instruments where available. If a quoted market price is not available, fair value is based on fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreement and the company’s credit standing. Since this amount is immaterial, no amounts for fair value are presented. The carrying value and estimated fair value of financial instruments at December 31 follows (dollar amounts in thousands): Fair Value Carrying amount Level 1 Level 2 Level 3 Total December 31, 2019 Financial assets: Cash and cash equivalents $ 86,452 $ 86,452 $ — $ — $ 86,452 Securities held to maturity 43,734 — 44,803 — 44,803 Securities available for sale 181,506 — 181,506 — 181,506 Loans held for sale 587 — — 587 587 Loans, net 1,724,947 — — 1,723,542 1,723,542 Other investments, at cost 4,933 — — 4,933 4,933 Mortgage servicing rights 4,287 — 4,287 — 4,287 Cash surrender value of life insurance 24,945 24,945 — — 24,945 Financial liabilities: Deposits $ 1,843,311 $ — $ — $ 1,783,638 $ 1,783,638 Securities sold under repurchase agreements 45,865 — 45,865 — 45,865 Notes payable 49,790 — 49,790 — 49,790 Subordinated notes 18,622 — 18,622 — 18,622 Fair Value Carrying amount Level 1 Level 2 Level 3 Total December 31, 2018 Financial assets: Cash and cash equivalents $ 107,743 $ 107,743 $ — $ — $ 107,743 Securities held to maturity 40,768 — 40,477 — 40,477 Securities available for sale 118,906 — 118,506 400 118,906 Loans, net 1,416,246 — — 1,400,538 1,400,538 Other investments, at cost 4,555 — — 4,555 4,555 Mortgage servicing rights 3,085 — 3,085 — 3,085 Cash surrender value of life insurance 24,178 24,178 — — 24,178 Financial liabilities: Deposits $ 1,557,167 $ — $ — $ 1,449,552 $ 1,449,552 Securities sold under repurchase agreements 31,489 — 31,489 — 31,489 Subordinated notes 11,500 — 11,500 — 11,500 The fair value of a financial instrument is the current amount that would be exchanged between willing parties, other than in a forced liquidation. Fair value is best determined based upon quoted market prices. However, in many instances, there are no quoted market prices for the Corporation’s various financial instruments. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. Accordingly, the fair value estimates may not be realized in an immediate settlement of the instrument. Consequently, the aggregate fair value amounts presented may not necessarily represent the underlying fair value of the Corporation. Fair value estimates are made at a specific point in time based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time the Corporation’s entire holdings of a particular instrument. Because no market exists for a significant portion of the Corporation’s financial instruments, fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments, and other factors. These estimates are subjective in nature and involve uncertainties and matters that could affect the estimates. Fair value estimates are based on existing on- and off-balance-sheet financial instruments without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments. Deposits with no stated maturities are defined as having a fair value equivalent to the amount payable on demand. This prohibits adjusting fair value derived from retaining those deposits for an expected future period of time. This component, commonly referred to as a deposit base intangible, is neither considered in the above amounts nor is it recorded as an intangible asset on the consolidated balance sheet. Significant assets and liabilities that are not considered financial assets and liabilities include premises and equipment. In addition, the tax ramifications related to the realization of the unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in the estimates. |
Parent Company Only Financial S
Parent Company Only Financial Statements | 12 Months Ended |
Dec. 31, 2019 | |
Parent Company Only Financial Statements | |
Parent Company Only Financial Statements | Note 23 Parent Company Only Financial Statements Balance Sheets December 31 2019 2018 (In Thousands) Assets Cash and cash equivalents $ 63 $ 72 Investment in Bank 254,299 183,290 Investment in Veritas 4,852 2,381 Other assets 557 978 TOTAL ASSETS $ 259,771 $ 186,721 Liabilities and Stockholders’ Equity Liabilities Notes payable $ 10,000 $ — Subordinated notes 18,500 11,500 Other liabilities 1,060 898 Total liabilities 29,560 12,398 Stockholders’ equity: Common stock 79 74 Additional paid-in capital 63,085 27,601 Retained earnings 189,494 168,363 Treasury stock, at cost (24,941) (21,349) Accumulated other comprehensive income 2,494 (366) Total stockholders’ equity 230,211 174,323 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 259,771 $ 186,721 Statements of Income Years Ended December 31 2019 2018 2017 (In Thousands) Income: Dividends received from Bank $ 16,335 $ 22,275 $ 19,480 Equity in undistributed earnings of subsidiaries 11,361 4,029 (3,773) Other income 234 74 — Total income 27,930 26,378 15,707 Other expenses 1,611 1,404 648 Benefit for income taxes (375) (482) (254) Net income $ 26,694 $ 25,456 $ 15,313 Statements of Cash Flows Years Ended December 31, 2019 2018 2017 (In thousands) Cash flow from operating activities: Net income $ 26,694 $ 25,456 $ 15,313 Adjustments to reconcile net income to net cash provided by operating activities: Stock compensation 685 556 465 Equity in earnings of subsidiaries (includes dividends) (27,696) (26,304) (15,707) Changes in other assets and liabilities: Other assets (329) (49) (44) Other liabilities (33) (90) 457 Net cash provided by (used in) operating activities (679) (431) 484 Cash flows from investing activities, net of effects of business combination: Sale of other investments 750 — — Dividends received from Bank 16,335 22,275 19,480 Dividends received from Veritas — — 450 Net cash used in business combination (14,241) — (33,378) Contribution to subsidiaries (2,620) — — Net cash provided by (used in) investing activities 224 22,275 (13,448) Cash flows from financing activities, net of effects of business combination: Proceeds from (repayment of) revolving line of credit 10,000 (5,000) 5,000 Proceeds from (repayment of) senior term debt — (3,500) 3,500 Proceeds from subordinated notes — — 11,500 Cash dividends paid (5,463) (4,530) (4,046) Issuance of common stock 114 1,347 896 Repurchase of common stock (4,205) (10,449) (3,631) Net cash provided by (used in) financing activities 446 (22,132) 13,219 Net increase (decrease) in cash and cash equivalents (9) (288) 255 Cash and cash equivalents at beginning 72 360 105 Cash and cash equivalents at end $ 63 $ 72 $ 360 Supplemental schedule of noncash activities: Amortization of unrealized holding gains on securities transferred from available for sale to held to maturity recognized in other comprehensive income, net of tax $ (35) $ (60) $ (80) Change in unrealized gains and losses on investment securities available for sale, net of tax 2,958 (1,367) 604 |
Earnings Per Common Share
Earnings Per Common Share | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Common Share | |
Earnings Per Common Share | Note 24 Earnings Per Common Share See Note 1 for the Corporation’s accounting policy regarding per share computations. Earnings per common share, earnings per share assuming dilution,and related information are summarized as follows: Years ended December 31, 2019 2018 2017 Net income from operations (in thousands) $ 26,694 $ 25,456 $ 15,313 Weighted average common shares outstanding 6,820,225 6,673,758 6,285,901 Effect of dilutive potential common shares 82,391 — — Diluted weighted average common shares outstanding 6,902,616 6,673,758 6,285,901 Earnings per share - basic $ $ $ Earnings per share - diluted $ $ $ |
Quarterly Results of Operations
Quarterly Results of Operations | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Results of Operations | Note 25 Quarterly Results of Operations 2019 Quarters Fourth Third Second First (Dollars in Thousands, Except Share and Per Share Data) Interest income $ 23,795 $ 25,489 $ 20,158 $ 19,723 Interest expense 5,015 5,176 4,784 4,523 Net interest and dividend income 18,780 20,313 15,374 15,200 Provision for loan losses 1,125 3,000 500 625 Net interest and dividend income after provision for loan losses 17,655 17,313 14,874 14,575 Noninterest income 3,211 3,145 2,736 3,540 Noninterest expense 11,182 12,087 9,955 9,536 Income before provision for income taxes 9,684 8,371 7,655 8,579 Provision for income taxes 2,225 1,712 1,666 1,992 Net income $ 7,459 $ 6,659 $ 5,989 $ 6,587 Share data Average shares outstanding, basic 7,084,728 7,036,807 6,577,016 6,574,362 Average shares outstanding, diluted 7,182,854 7,134,674 6,675,794 6,608,273 Earnings per share, basic $ 1.05 $ 0.95 $ 0.91 $ 1.00 Earnings per share, diluted $ 1.04 $ 0.93 $ 0.90 $ 1.00 2018 Quarters Fourth Third Second First (Dollars in Thousands, Except Share and Per Share Data) Interest income $ 19,753 $ 19,510 $ 19,372 $ 19,309 Interest expense 4,240 3,974 3,604 3,027 Net interest and dividend income 15,513 15,536 15,768 16,282 Provision for loan losses 750 800 900 485 Net interest and dividend income after provision for loan losses 14,763 14,736 14,868 15,797 Noninterest income 2,553 2,508 3,027 3,443 Noninterest expense 9,893 9,708 10,064 9,977 Income before provision for income taxes 7,423 7,536 7,831 9,263 Provision for income taxes 1,362 1,604 1,431 2,200 Net income $ 6,061 $ 5,932 $ 6,400 $ 7,063 Share data Average shares outstanding, basic and diluted 6,647,586 6,661,337 6,672,344 6,714,347 Earnings per share, basic and diluted $ 0.91 $ 0.89 $ 0.96 $ 1.05 |
Pending Merger Transaction
Pending Merger Transaction | 12 Months Ended |
Dec. 31, 2019 | |
Acquisitions | |
Pending Merger Transaction | Note 26 Pending Merger Transaction On November 20, 2019, the Corporation entered into an Agreement and Plan of Merger with Tomah Bancshares, Inc. ("Timberwood"),a Wisconsin Corporation, under which Timberwood will merge with and Into the Corporation and Timberwood's banking subsidiary, Timberwood Bank, will merge with and into the Bank. The transaction is expected to close in the second quarter of 2020 and is subject to, among other items, approval by the shareholders of Timberwood. Merger consideration consists of 100% common stock of the Corporation, and will total roughly $32,600,000, subject to the fair market valuation of the Corporation’s common stock on the date of closing. Based on results as of December 31, 2019, the combined company would have total assets of approximately $2.4 billion, loans of approximately $1.8 billion and deposits of approximately $2.0 billion. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Significant Accounting Policies | |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of the Corporation and its wholly owned subsidiaries, Veritas Asset Holdings, LLC ( “Veritas” ) and Bank First, National Association ( “Bank” ). The Bank’s wholly owned subsidiaries are Bank First Investments, Inc. and TVG Holdings, Inc. ( “TVG” ). All significant intercompany balances and transactions have been eliminated. The Bank and TVG have investments in minority-owned subsidiaries that are accounted for using the equity method in the consolidated financial statements. The Bank owns 49.8% of UFS which provides data processing solutions to over 60 banks in the Midwest. TVG owns 40.0% of Ansay providing clients throughout the Midwest with superior insurance and risk management solutions. |
Organization | OrganizationThe Corporation provides a variety of financial services to individual and business customers, primarily located in Wisconsin, through the Bank. The Bank is subject to competition from other traditional and nontraditional financial institutions and is also subject to the regulations of certain federal agencies and undergoes periodic examinations by those regulatory authorities including the Office of the Comptroller of the Currency and the Federal Reserve Bank. |
Use of Estimates in Preparation of Financial Statements | Use of Estimates in Preparation of Financial Statements The preparation of the accompanying consolidated financial statements in conformity with GAAP in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results may differ from these estimates. The allowance for loan losses, carrying value of real estate owned, carrying value of goodwill, fair value of mortgage servicing rights, and fair values of financial instruments are inherently subjective and are susceptible to significant change. |
Business Combinations | Business Combinations The Corporation accounts for business combinations under the acquisition method of accounting in accordance with Financial Accounting Standards Board (“FASB” ) Accounting Standards Codification ( “ASC” ) 805, Business Combinations. The Corporation recognizes the full fair value of the assets acquired and liabilities assumed and immediately expenses transaction costs. There is no separate recognition of the acquired allowance for loan losses on the acquirer’s balance sheet as credit related factors are incorporated directly into the fair value of the net tangible and intangible assets acquired. If the amount of consideration exceeds the fair value of assets purchased less the fair value of liabilities assumed, goodwill is recorded. Alternatively, if the amount by which the fair value of assets purchased exceeds the fair value of liabilities assumed and consideration paid, a gain (bargain purchase gain) is recorded. Fair values are subject to refinement for up to one year after the closing date of an acquisition as information relative to closing date fair values becomes available. Results of operations of the acquired business are included in the statement of income from the effective date of the acquisition. Additional information regarding acquisitions is provided in Note 2. |
Cash and Cash Equivalents | Cash and Cash Equivalents For purposes of reporting cash flows in the consolidated financial statements, cash and cash equivalents include cash on hand, interest-bearing and noninterest-bearing accounts in other financial institutions, and federal funds sold, all of which have original maturities of three months or less. Generally, federal funds are purchased and sold for one day periods. In the normal course of business, the Corporation maintains cash and due from bank balances with correspondent banks. Accounts at each institution that are insured by the Federal Deposit Insurance Corporation have up to $250,000 of insurance. Total uninsured balances held at December 31, 2019 and 2018 were approximately $1,900,000 and $1,013,000, respectively. The Bank is required to maintain deposits on hand or with the Federal Reserve Bank to meet specific reserve requirements. For December 31, 2019 and 2018 those required reserves were approximately $26,184,000 and $28,302,000 respectively. |
Securities | Securities Securities are classified as held to maturity or available for sale at the time of purchase. Investment securities classified as held to maturity, which management has the intent and ability to hold to maturity, are reported at amortized cost. Investment securities classified as available for sale, which management has the intent and ability to hold for an indefinite period of time, but not necessarily to maturity, are carried at fair value, with unrealized gains and losses, net of related deferred income taxes, included in stockholders’ equity as a separate component of other comprehensive income. The net carrying value of debt securities classified as held to maturity or available for sale is adjusted for amortization of premiums and accretion of discounts utilizing the effective interest method over the expected estimated maturity. Such amortization and accretion is included as an adjustment to interest income from securities. Interest and dividends are included in interest income from securities. Transfers of debt securities into the held to maturity classification from the available for sale classification are made at fair value as of the date of transfer. The unrealized holding gain or loss as of the date of transfer is retained in other comprehensive income and in the carrying value of the held to maturity securities, establishing the amortized cost of the security. These unrealized holding gains and losses as of the date of transfer are amortized or accreted over the remaining life of the security. Unrealized gains or losses considered temporary and the noncredit portion of unrealized losses deemed other-than-temporary are reported as an increase or decrease in accumulated other comprehensive income. The credit related portion of unrealized losses deemed other-than-temporary is recorded in current period earnings. Realized gains or losses, determined on the basis of the cost of specific securities sold, are included in earnings. The Bank evaluates securities for other-than-temporary impairment at least on a quarterly basis, and more frequently when economic or market concerns warrant such evaluation. As part of such monitoring, the credit quality of individual securities and their issuers are assessed. In addition, management considers the length of time and extent that fair value has been less than cost, the financial condition and near-term prospects of the issuer, and that the Corporation does not have the intent to sell the security and it is more likely than not that it will not have to sell the security before recovery of its cost basis. Adjustments to market value that are considered temporary are recorded as a separate component of equity, net of tax. If an impairment of security is identified as other-than-temporary based on information available such as the decline in the credit worthiness of the issuer, external market ratings or the anticipated or realized elimination of associated dividends, such impairments are further analyzed to determine if a credit loss exists. If there is a credit loss, it will be recorded in the consolidated statement of income in the period of identification. |
Other Investments | Other Investments Other investments are carried at cost, or, where available, recently observable market prices, which approximates fair value, and consist of Federal Home Loan Bank of Chicago ( “FHLB” ) stock, Federal Reserve Bank stock, Bankers’ Bancorporation stock and preferred stock in a community development project. Other investments are evaluated for impairment at least on an annual basis. |
Loans Held for Sale | Loans Held for Sale Loans originated and intended for sale in the secondary market, consisting of the current origination of certain fixed-rate mortgage loans, are carried at the lower of cost or estimated fair value in the aggregate. A gain or loss is recognized at the time of the sale reflecting the present value of the difference between the contractual interest rate of the loans sold and the yield to the investor, adjusted for the initial value of mortgage servicing rights associated with loans sold with servicing retained. Net unrealized losses, if any, are recorded as a valuation allowance and charged to earnings. |
Loans and Related Interest Income - Originated | Loans and Related Interest Income - OriginatedLoans that management has the intent and ability to hold for the foreseeable future or until maturity or payoffs are generally reported at their outstanding unpaid principal balances adjusted for charge-offs and the allowance for loan losses. The accrual of interest on loans is calculated using the simple interest method on daily balances of the principal amount outstanding and is recognized in the period earned utilizing the loan convention applicable by loan type. Loan origination fees, net of certain direct loan origination costs, are deferred and recognized in interest income using the effective interest method over the estimated life of the loan.The accrual of interest is discontinued when a loan becomes 90 days past due and is not both well collateralized and in the process of collection, or when management believes, after considering economic and business conditions and collection efforts, that the principal or interest will not be collectible in the normal course of business. When loans are placed on nonaccrual or charged off, all unpaid accrued interest is reversed and additional income is recorded only to the extent that payments are received and the collection of principal is reasonably assured. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current, when the obligation has performed in accordance with the contractual terms for a reasonable period of time, and future payments of principal and interest are reasonably assured. Loans are considered impaired if it is probable that payment of interest and principal will not be made in accordance with the contractual terms of the loan agreement. Total impaired loans are evaluated based on the fair value of the collateral rather than on discounted cash flow basis. |
Loans and Related Interest Income - Acquired | Loans and Related Interest Income - Acquired Acquired loans are recorded at their estimated fair value at the acquisition date, and are initially classified as either purchase credit impaired ( “PCI” ) loans (i.e. loans that reflect credit deterioration since origination and it is probable at acquisition that the Corporation will be unable to collect all contractually required payments) or purchased non-impaired loans (i.e. performing acquired loans). PCI loans are accounted for under the accounting guidance for loans and debt securities acquired with deteriorated credit quality, found in FASB ASC Topic 310‑30, Receivables— Loans and Debt Securities Acquired with Deteriorated Credit Quality. The Corporation estimates the amount and timing of expected principal, interest and other cash flows for each loan or pool of loans meeting the criteria above, and determines the excess of the loan’s scheduled contractual principal and contractual interest payments over all cash flows expected to be collected at acquisition as an amount that should not be accreted. These credit discounts (nonaccretable marks) are included in the determination of the initial fair value for acquired loans; therefore, an allowance for loan losses is not recorded at the acquisition date. Differences between the estimated fair values and expected cash flows of acquired loans at the acquisition date that are not credit-based (accretable marks) are subsequently accreted to interest income over the estimated life of the loans using a method that approximates a level yield method if the timing and amount of the future cash flows is reasonably estimable. Subsequent to the acquisition date for PCI loans, increases in cash flows over those expected at the acquisition date result in a move of the discount from nonaccretable to accretable. Decreases in expected cash flows after the acquisition date are recognized through the provision for loan losses. Performing acquired loans are accounted for under FASB ASC Topic 310‑20, Receivables—Nonrefundable Fees and Other Costs. Performance of certain loans may be monitored and based on management’s assessment of the cash flows and other facts available, portions of the accretable difference may be delayed or suspended if management deems appropriate. The Corporation’s policy for determining when to discontinue accruing interest on performing acquired loans and the subsequent accounting for such loans is essentially the same as the policy for originated loans described above. |
Allowance for Loan Losses - Originated | Allowance for Loan Losses - Originated The allowance for loan losses ( “ALL” ) is established through a provision for loan losses charged to expense as losses are estimated to have occurred. Loan losses are charged against the allowance when management believes that the collectability of the principal is unlikely. Subsequent recoveries, if any, are credited to the allowance. Management regularly evaluates the allowance for loan losses using general economic conditions, the Corporation’s past loan loss experience, composition of the portfolio, and other relevant factors. This evaluation is inherently subjective since it requires material estimates that may be susceptible to significant change. The ALL consists of specific reserves for certain impaired loans and general reserves for non-impaired loans. Specific reserves reflect estimated losses on impaired loans from management’s analyses developed through specific credit allocations. The specific credit reserves are based on regular analyses of impaired non-homogenous loans greater than $250,000. These analyses involve a high degree of judgment in estimating the amount of loss associated with specific loans, including estimating the amount and timing of future cash flows and collateral values. The general reserve is based on the Bank’s historical loss experience which is updated quarterly. The general reserve portion of the ALL also includes consideration of certain qualitative factors such as 1) changes in lending policies and/or underwriting practices, 2) national and local economic conditions 3) changes in portfolio volume and nature, 4) experience, ability and depth of lending management and other relevant staff, 5) levels of and trends in past-due and nonaccrual loans and quality, 6) changes in loan review and oversight, 7) impact and effects of concentrations and 8) other issues deemed relevant. Management believes that the allowance for loan losses is adequate. While management uses available information to recognize losses on loans, future additions to the allowance may be necessary based on changes in economic conditions. In addition, various regulatory agencies, as an integral part of their examination process, periodically review the allowance for loan losses. Such agencies may require the Bank to recognize additions to the allowance based on their judgments of information available to them at the time of their examination. |
Allowance for Loan Losses - Acquired | Allowance for Loan Losses - AcquiredAn ALL is calculated using a methodology similar to that described for originated loans. Performing acquired loans are subsequently evaluated for any required allowance at each reporting date. Such required allowance for each loan pool is compared to the remaining fair value discount for that pool. If greater, the excess is recognized as an addition to the allowance through a provision for loan losses. If less than the discount, no additional allowance is recorded. Charge-offs and losses first reduce any remaining fair value discount for the loan pool and once the discount is depleted, losses are applied against the allowance established for that pool.For PCI loans after acquisition, cash flows expected to be collected are recast for each loan periodically as determined appropriate by management. If the present value of expected cash flows for a loan is less than its carrying value, impairment is reflected by an increase in the ALL and a charge to the provision for loan losses. If the present value of the expected cash flows for a loan is greater than its carrying value, any previously established ALL is reversed and any remaining difference increases the accretable yield which will be taken into income over the remaining life of the loan. Loans which were considered troubled debt restructurings by Partnership Community Bancshares, Inc. and Waupaca Bancorporation, Inc. prior to the acquisition are not required to be classified as troubled debt restructurings in the Corporation’s consolidated financial statements unless or until such loans would subsequently meet criteria to be classified as such, since acquired loans were recorded at their estimated fair values at the time of the acquisition. |
Premises and Equipment | Premises and Equipment Premises and equipment are stated at cost less accumulated depreciation computed on the straight-line method over the estimated useful lives of the assets. Premises and equipment acquired in corporate acquisitions are recorded at estimated fair value on the date of acquisition. Maintenance and repair costs are charged to expense as incurred. Gains or losses on disposition of premises and equipment are reflected in income. Premises and equipment, and other long-term assets, are reviewed for impairment when events indicate their carrying amount may not be recoverable from future undiscounted cash flows. If impaired, the assets are recorded at fair value. Depreciation expense is computed using the straight-line method over the following estimated useful lives. Buildings and improvements 40 years Land improvements 20 years Furniture, fixtures and equipment 2-7 years |
Other Real Estate Owned | Buildings and improvements 40 yearsLand improvements 20 yearsFurniture, fixtures and equipment 2-7 yearsOther Real Estate OwnedAssets acquired through, or in lieu of, loan foreclosure are held for sale and are initially recorded at fair value at the date of foreclosure less estimated costs to sell the asset, establishing a new cost basis. Any write downs at the time of foreclosure are charged to the allowance for loan loss. OREO properties acquired in conjunction with corporate acquisitions are recorded at fair value on the date of acquisition. Subsequent to foreclosure, valuations are periodically performed by management, and a valuation allowance is established if fair value declines below carrying value. Costs relating to the development and improvement of the property are capitalized. Revenue and expenses from operations and changes in the valuation allowance are included in other expenses. |
Intangible Assets and Goodwill | Intangible Assets and Goodwill Intangible assets consist of the value of core deposits and mortgage servicing assets and the excess of purchase price over fair value of net assets (goodwill). Core deposits are stated at cost less accumulated amortization and are amortized on a sum of the year’s digits basis over a period of one to ten years. See Note 2 for additional information on acquisitions completed in 2019 and 2017. Mortgage servicing rights are recognized as separate assets when rights are acquired through purchase or through sale of mortgage loans with servicing retained. Servicing rights acquired through sale of financial assets are recorded based on the fair value of the servicing right. The determination of fair value is based on a valuation model and includes stratifying the mortgage servicing rights by predominant characteristics, such as interest rates and terms, and estimating the fair value of each stratum based on the present value of estimated future net servicing income. The valuation model incorporates assumptions that market participants would use in estimating future net servicing income, such as costs to service, a discount rate, and prepayment speeds. Changes in fair value are recorded as an adjustment to earnings. The Corporation performs a “qualitative” assessment of goodwill to determine whether further impairment testing of indefinite-lived intangible assets is necessary on at least an annual basis. If it is determined, as a result of performing a qualitative assessment over goodwill, that it is more likely than not that goodwill is impaired, management will perform an impairment test to determine if the carrying value of goodwill is realizable. The Corporation evaluated goodwill and core deposit intangibles for impairment during 2019, 2018 and 2017, determining that there was no goodwill or core deposit intangible impairment. |
Income Taxes | Income Taxes The Corporation files one consolidated federal income tax return and two state returns. Federal income tax expense is allocated to each subsidiary based on an intercompany tax sharing agreement. Deferred tax assets and liabilities have been determined using the liability method. Deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities and the current enacted tax rates which will be in effect when these differences are expected to reverse. Provision (benefit) for deferred taxes is the result of changes in the deferred tax assets and liabilities. |
Treasury Stock | Treasury StockCommon stock shares repurchased by the Corporation are recorded as treasury stock at cost. |
Securities Sold Under Repurchase Agreements | Securities Sold Under Repurchase Agreements The Corporation sells securities under repurchase agreements. These transactions are accounted for as collateralized financing transactions and are recorded at the amounts at which the securities were sold. The Corporation may have to provide additional collateral to the counterparty, as necessary. |
Off-Balance-Sheet Financial Instruments | Off-Balance-Sheet Financial Instruments In the ordinary course of business, the Corporation has entered into off-balance-sheet financial instruments including commitments to extend credit, unfunded commitments under lines of credit, and letters of credit. Such financial instruments are recorded in the consolidated financial statements when they are funded. |
Advertising | Advertising Advertising costs are generally expensed as incurred. |
Per Share Computations | Per Share Computations Weighted average shares outstanding were 6,820,225, 6,673,758, and 6,285,901 for the years ended December 31, 2019, 2018 and 2017, respectively. All outstanding unvested share-based payment awards that contain rights to non-forfeitable dividends are considered participating securities for basic and diluted earnings per share calculations. There were 82,391 average shares of dilutive instruments outstanding during the year ended December 31, 2019. There were no dilutive instruments outstanding during 2018 or 2017. |
Loss Contingencies | Loss Contingencies Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated. Management does not believe that there are any such matters that will have a material effect on the consolidated financial statements at December 31, 2019 and 2018. |
Transfers of Financial Assets | Transfers of Financial Assets Transfers of financial assets are accounted for as sales when control over the assets has been relinquished. Control over transferred assets is deemed to be surrendered when the assets have been isolated from the Bank, the transferee obtains the right, free of conditions that constrain it from taking advantage of that right, to pledge or exchange the transferred assets and the Bank does not maintain effective control over the transferred assets through an agreement to repurchase them before maturity. |
Comprehensive Income | Comprehensive Income GAAP normally requires that recognized revenues, expenses, gains and losses be included in net income. In addition to net income, another component of comprehensive income includes the after-tax effect of changes in unrealized gains and losses on available for sale securities. This item is reported as a separate component of stockholders’ equity. The Corporation presents comprehensive income in the statement of comprehensive income. |
Stock-based Compensation | Stock-based Compensation The Corporation uses the fair value method of recognizing expense for stock-based compensation based on the fair value of restricted stock awards at the date of grant as prescribed by accounting standards codification Topic 781‑10 Compensation/Stock Compensation. |
Mortgage Banking Derivatives | Mortgage Banking Derivatives Commitments to fund mortgage loans (interest rate locks) to be sold into the secondary market and forward commitments for the future delivery of these mortgage loans are accounted for as free standing derivatives. Fair values of these mortgage derivatives are estimated based on changes in mortgage interest rates from the date the interest rate on the loan is locked. The Bank enters into forward commitments for the future delivery of mortgage loans when interest rate locks are entered into in order to hedge the change in interest rates resulting from its commitments to fund loans. The forward commitments for the future delivery of mortgage loans are based on the Bank’s “best efforts” and therefore the Bank is not penalized if a loan is not delivered to the investor if the loan did not get originated. Changes in the fair values of these derivatives generally offset each other and are included in “other income” in the consolidated statements of income. |
Reclassifications | Reclassifications Certain 2018 and 2017 amounts have been reclassified to conform to the presentation used in 2019. These reclassifications had no effect on the operations, financial condition or cash flows of the Corporation. |
New Accounting Pronouncements | New Accounting Pronouncements In May 2014, the FASB issued Accounting Standard Update ( “ASU”) 2014‑09, Revenue from Contracts with Customers (Topic 606) (ASU 2014‑09). ASU 2014‑09 implements a common revenue standard that clarifies the principles for recognizing revenue. The core principle of ASU 2014‑09 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply the following steps: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract and (v) recognize revenue when (or as) the entity satisfies a performance obligation. ASU 2015‑14, Revenue from Contracts with Customers (Topic 606) (ASU 2015‑14) was issued in August 2015 which defers adoption to annual reporting periods beginning after December 15, 2017 and interim reporting periods within that year. The timing of the Corporation’s revenue recognition did not materially change. The Corporation’s largest portions of revenue, interest and fees on loans and gain on sales of loans, are specifically excluded from the scope of the guidance, and the Corporation currently recognizes the majority of the remaining revenue sources in a manner that management believes is consistent with the new guidance. Unconsolidated subsidiaries of the Bank did have a material impact as a result of this ASU, and implementation resulted in a decrease of $100,000 to retained earnings during 2019 and an increase of $1,588,000 to retained earnings during 2018. In January 2016, the FASB issued ASU 2016‑01, Financial Instruments—Overall (Subtopic 825‑10): Recognition and Measurement of Financial Assets and Financial Liabilities (ASU 2016‑01). This guidance changes how entities account for equity investments that do not result in consolidation and are not accounted for under the equity method of accounting. Entities will be required to measure these investments at fair value at the end of each reporting period and recognize changes in fair value in net income. A practicability exception will be available for equity investments that do not have readily determinable fair values; however, the exception requires the Corporation to adjust the carrying amount for impairment and observable price changes in orderly transactions for the identical or a similar investment of the same issuer. This guidance also changes certain disclosure requirements and other aspects of current GAAP. This guidance was effective for fiscal years beginning after December 15, 2017 and for interim reporting periods within that year. The adoption of this ASU did not have a material impact on the Corporation’s consolidated financial statements. In February 2016, the FASB issued ASU 2016‑02, Leases (Topic 842) (ASU 2016‑02). Certain aspects of this ASU were updated in July 2018 by the issuance of ASU, 2018‑10, Codification Improvements to Topic 842, Leases. The new guidance established the principles to report transparent and economically neutral information about the assets and liabilities that arise from leases. Entities are required to recognize the lease assets and lease liabilities that arise from leases in the statement of financial position and to disclose qualitative and quantitative information about lease transactions, such as information about variable lease payments and options to renew and terminate leases. This guidance was effective for fiscal years beginning after December 15, 2018 and interim reporting periods within that year. See Note 21 for details concerning how the adoption of this ASU impacted the Corporation's consolidated financial statements. In June 2016, the FASB issued ASU 2016‑13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. Certain aspects of this ASU were updated in November 2018 by the issuance of ASU 2018‑19, Codification Improvements to Topic 326, Financial Instruments—Credit Losses . The main objective of the ASU is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. To achieve this objective, the amendments in the ASU replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. During 2019 FASB issued ASU 2019-10 which delayed the effective date of ASU 2016-13 for smaller, publicly traded companies, until interim and annual periods beginning after December 15, 2022. This delay applies to the Corporation as it was classified as a "Smaller reporting company" as defined in Rule 12b-2 of the Exchange Act as of the date ASU 2019-10 was enacted. The Corporation is currently evaluating the impact of ASU 2016‑13 on the consolidated financial statements, although the general expectation in the banking industry is that the implementation of this standard will result in higher required balances in the allowance for loan losses. In January 2017, the FASB issued ASU 2017‑04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment . The amendments in this ASU were issued to address concerns over the cost and complexity of the two-step goodwill impairment test and resulted in the removal of the second step of the test. The amendments require an entity to apply a one-step quantitative test and record the amount of goodwill impairment as the excess of a reporting unit’s carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit. The new guidance does not amend the optional qualitative assessment of goodwill impairment. This ASU is intended to reduce the cost and complexity of the two-step goodwill impairment test and is effective for annual and interim goodwill impairment tests in fiscal years beginning after December 15, 2019, with early adoption permitted for testing performed after January 1, 2017. Upon adoption, the amendments should be applied on a prospective basis and the entity is required to disclose the nature of and reason for the change in accounting principle upon transition. The adoption of this guidance is not expected to have a significant impact on the Corporation’s consolidated financial statements. In March 2017, the FASB issued ASU 2017‑08, Receivables—Nonrefundable Fees and Other Costs (Subtopic 310‑20): Premium Amortization on Purchased Callable Debt Securities . The amendments in this ASU shortened the amortization period for certain callable debt securities held at a premium. Specifically, the amendments required the premium to be amortized to the earliest call date. The amendments did not require an accounting change for securities held at a discount as discounts continue to be accreted to maturity. This ASU was intended to more closely align the amortization period of premiums and discounts to expectations incorporated in market pricing on the underlying securities. In most cases, market participants price securities to the call date that produces the worst yield when the coupon is above current market rates and prices securities to maturity when the coupon is below market rates. As a result, the amendments more closely aligned interest income recorded on bonds held at a premium or a discount with the economics of the underlying instrument. This ASU was intended to reduce diversity in practice and was effective for fiscal years beginning after December 15, 2018, with early adoption permitted. Upon adoption, the amendments were applied using a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. Additionally, in the period of adoption, an entity was to provide disclosures about a change in accounting principles. The adoption of this guidance did not have an impact on the Corporation’s consolidated financial statements as all premiums within its securities portfolio were already being amortized to the earliest call date prior to implementation. In August 2017, the FASB issued ASU 2017‑12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities . The amendments of this ASU better align an entity’s accounting and financial reporting for hedging activities with the economic objectives of those activities. The ASU was effective for fiscal years beginning after December 15, 2018 and interim reporting periods within that fiscal year, with early adoption permitted. The adoption of this guidance did not have a significant impact on the Corporation’s consolidated financial statements. In June 2018, the FASB issued ASU 2018‑07, Stock Compensation—Improvements to Nonemployee Share-Based Payment Accounting , which simplified several aspects of the accounting for nonemployee share-based payment transactions for acquiring goods or services from nonemployees. The amendment was effective for the fiscal years beginning after December 15, 2018, with early adoption permitted. The adoption of this guidance did not have a significant impact on the Corporation’s consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Significant Accounting Policies | |
Property Plant and Equipment Estimated Useful Lives | Depreciation expense is computed using the straight-line method over the following estimated useful lives. Buildings and improvements 40 years Land improvements 20 years Furniture, fixtures and equipment 2-7 years |
Acquisition (Tables)
Acquisition (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block] | As Recorded by Partnership As Recorded by Community Fair Value Bank First (in thousands) Bancshares Adjustments Corporation Cash, cash equivelants and securities $ 21,447 $ (291) $ 21,156 Other investments 441 441 Loans 276,279 (957) 275,322 Premises and equipment, net 6,066 (2,940) 3,126 Core deposit intangible — 4,236 4,236 Other assets 3,668 (181) 3,487 Total assets acquired $ 307,901 $ (133) $ 307,768 Deposits $ 268,653 $ 154 $ 268,807 Subordinated debt 7,000 195 7,195 Other borrowings 9,800 (18) 9,782 Other liabilities 841 (13) 828 Total liabilities assumed $ 286,294 $ 318 $ 286,612 Excess of assets acquired over liabilties assumed $ 21,607 $ (451) $ 21,156 Less: purchase price 49,588 Goodwill $ 28,432 |
Waupaca Bancorporation Inc [Member] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block] | As recorded by As recorded by Waupaca Fair Value Bank First Bancorporation, Inc. Adjustment Corporation (in thousands) Cash, cash equivalents and securities $ 62,174 $ (400) $ 61,774 Loans 337,548 1,716 339,264 Other real estate owned 3,348 (640) 2,708 Premises and equipment, net 7,661 (4,105) 3,556 Core deposit intangible — 3,097 3,097 Other assets 8,182 (346) 7,836 Total assets acquired $ 418,913 $ (678) $ 418,235 Deposits $ 344,798 $ 810 $ 345,608 Other liabilities 1,605 63 1,668 Total liabilities assumed $ 346,403 $ 873 $ 347,276 Excess of assets acquired over liabilities assumed $ $ (1,551) $ 70,959 Less: purchase price 78,060 Goodwill (originally recorded) 7,101 Refinement to fair value estimates during 2018 (61) Goodwill (after refinement) $ 7,040 |
Securities (Tables)
Securities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Securities | |
Schedule of securities available for sale | The following is a summary of available for sale securities (dollar amounts in thousands): Gross Gross Amortized Unrealized Unrealized Estimated Cost Gains Losses Fair Value December 31, 2019 Obligations of U.S. Government sponsored agencies $ 12,218 $ — $ (158) $ 12,060 Obligations of states and political subdivisions 52,594 2,197 (20) 54,771 Mortgage-backed securities 50,770 988 (38) 51,720 Corporate notes 62,794 172 (11) 62,955 Total available for sale securities $ 178,376 $ 3,357 $ (227) $ 181,506 December 31, 2018 Obligations of states and political subdivisions $ 51,292 $ 709 $ (108) $ 51,893 Mortgage-backed securities 51,519 66 (1,016) 50,569 Corporate notes 16,708 — (264) 16,444 Total available for sale securities $ 119,519 $ 775 $ (1,388) $ 118,906 |
Schedule of securities held to maturity | The following is a summary of held to maturity securities (dollar amounts in thousands): Gross Gross Amortized Unrealized Unrealized Estimated Cost Gains Losses Fair Value December 31, 2019 U.S. Treasury securities $ 33,527 $ 1,076 $ (22) $ 34,581 Obligations of states and political subdivisions 10,207 15 — 10,222 Total held to maturity securities $ 43,734 $ 1,091 $ (22) $ 44,803 December 31, 2018 U.S. Treasury securities $ 28,975 $ 92 $ (389) $ 28,678 Obligations of states and political subdivisions 11,793 6 — 11,799 Total held to maturity securities $ 40,768 $ 98 $ (389) $ 40,477 |
Schedule of fair value and gross unrealized lossess of securities | The following table shows the fair value and gross unrealized losses of securities with unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position (dollar amounts in thousands): Less Than 12 Months Greater Than 12 Months Total Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses December 31, 2019 - Available for Sale Obligations of U.S. Government sponsored agencies $ 12,059 $ (158) $ — $ — $ 12,059 $ (158) Obligations of states and political subdivisions 5,636 (19) 999 (1) 6,635 (20) Mortgage-backed securities 4,038 (26) 2,187 (12) 6,225 (38) Corporate notes 3,925 (11) — — 3,925 (11) Totals $ 25,658 $ (214) $ 3,186 $ (13) $ 28,844 $ (227) December 31, 2019 - Held to Maturity U.S. Treasury securities $ 2,958 $ (22) $ — $ — $ 2,958 $ (22) December 31, 2018 - Available for Sale Obligations of states and political subdivisions $ 10,024 $ (64) $ 4,132 $ (44) $ 14,156 $ (108) Mortgage-backed securities 13,352 (183) 31,718 (833) 45,070 (1,016) Corporate notes — — 12,531 (264) 12,531 (264) Totals $ 23,376 $ (247) $ 48,381 $ (1,141) $ 71,757 $ (1,388) December 31, 2018 - Held to Maturity U.S. Treasury securities $ 8,422 $ (46) $ 11,580 $ (343) $ 20,002 $ (389) |
Schedule of amortized cost and estimated fair value of securities | Contractual maturities will differ from expected maturities for mortgage-backed securities because borrowers may have the right to call or prepay obligations without penalties. The following is a summary of amortized cost and estimated fair value of securities, by contractual maturity, as of December 31, 2019 (dollar amounts in thousands): Available for Sale Held to Maturity Amortized Estimated Amortized Estimated Cost Fair Value Cost Fair Value Due in one year or less $ 47,437 $ 47,446 $ 4,136 $ 4,151 Due after one year through 5 years 23,339 23,783 16,777 17,120 Due after 5 years through ten years 13,153 13,843 19,912 20,623 Due after 10 years 43,677 44,714 2,909 2,909 Subtotal 127,606 129,786 43,734 44,803 Mortgage-backed securities 50,770 51,720 — — Total $ 178,376 $ 181,506 $ 43,734 $ 44,803 |
Schedule of proceeds from sale of securities available for sale | Following is a summary of the proceeds from sales of securities available for sale, as well as gross gains and losses, from the years ended December 31 (dollar amounts in thousands): 2019 2018 2017 Proceeds from sales of securities $ 45,506 $ 4,467 $ 48,906 Gross gains on sales 657 41 73 Gross losses on sales (23) (72) (105) |
Loans (Tables)
Loans (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
LOANS, ALLOWANCE FOR LOAN LOSSES, AND CREDIT QUALITY | |
Schedule of total loans by portfolio segment and class of loan | The composition of loans at December 31 is as follows (dollar amounts in thousands): 2019 2018 Commercial/industrial $ 302,538 $ 297,576 Commercial real estate - owner occupied 459,782 416,097 Commercial real estate - non- owner occupied 353,723 252,717 Construction and development 132,296 60,927 Residential 1‑4 family 448,605 368,673 Consumer 29,462 26,854 Other 10,440 6,369 Subtotals 1,736,846 1,429,213 ALL (11,396) (12,248) Loans, net of ALL 1,725,450 1,416,965 Deferred loan fees and costs (503) (719) Loans, net $ 1,724,947 $ 1,416,246 |
Schedule of ALL by loan type | A summary of the activity in the allowance for loan losses by loan type as of December 31, 2019 and December 31, 2018 is as follows (dollar amounts in thousands): Commercial Commercial Real Estate - Real Estate - Construction Commercial / Owner Non-Owner and Residential Industrial Occupied Occupied Development 1-4 Family Consumer Other Total ALL - January 1, 2019 $ 3,021 $ 3,750 $ 2,100 $ 725 $ 2,472 $ 148 $ 32 $ 12,248 Charge-offs (1,229) (4,994) (62) — (276) (76) (41) (6,678) Recoveries 11 356 60 — 130 11 8 576 Provision 517 5,475 (520) (177) (157) 58 54 5,250 ALL - December 31, 2019 2,320 4,587 1,578 548 2,169 141 53 11,396 ALL ending balance individually evaluated for impairment 760 80 — — — — — 840 ALL ending balance collectively evaluated for impairment $ 1,560 $ 4,507 $ 1,578 $ 548 $ 2,169 $ 141 $ 53 $ 10,556 Loans outstanding - December 31, 2019 $ 302,538 $ 459,782 $ 353,723 $ 132,296 $ 448,605 $ 29,462 $ 10,440 $ 1,736,846 Loans ending balance individually evaluated for impairment 1,878 960 — — — — — 2,838 Loans ending balance collectively evaluated for impairment $ 300,660 $ 458,822 $ 353,723 $ 132,296 $ 448,605 $ 29,462 $ 10,440 $ 1,734,008 Commercial Commercial Real Estate - Real Estate - Construction Commercial / Owner Non-Owner and Residential Industrial Occupied Occupied Development 1-4 Family Consumer Other Total ALL - January 1, 2018 $ 2,362 $ 3,376 $ 1,987 $ 945 $ 2,728 $ 191 $ 23 $ 11,612 Charge-offs (35) (2,374) — (83) (140) (48) (37) (2,717) Recoveries 2 158 3 — 233 12 10 418 Provision 692 2,590 110 (137) (349) (7) 36 2,935 ALL - December 31, 2018 3,021 3,750 2,100 725 2,472 148 32 12,248 ALL ending balance individually evaluated for impairment 566 353 — — 160 — — 1,079 ALL ending balance collectively evaluated for impairment $ 2,455 $ 3,397 $ 2,100 $ 725 $ 2,312 $ 148 $ 32 $ 11,169 Loans outstanding - December 31, 2018 $ 297,576 $ 416,097 $ 252,717 $ 60,927 $ 368,673 $ 26,854 $ 6,369 $ 1,429,213 Loans ending balance individually evaluated for impairment 5,667 7,796 — — 702 — — 14,165 Loans ending balance collectively evaluated for impairment $ 291,909 $ 408,301 $ 252,717 $ 60,927 $ 367,971 $ 26,854 $ 6,369 $ 1,415,048 |
Schedule of past due loans | A summary of past due loans as of December 31, 2019 are as follows (dollar amounts in thousands): 90 Days 30-89 Days or more Past Due Past Due 2019 Accruing and Accruing Non-Accrual Total Commercial/industrial $ 235 $ — $ 1,923 $ 2,158 Commercial real estate - owner occupied 1,124 — 2,513 3,637 Commercial real estate - non-owner occupied — — 75 75 Construction and development 768 11 — 779 Residential 1‑4 family 805 307 550 1,662 Consumer 70 36 32 138 Other — — — — $ 3,002 $ 354 $ 5,093 $ 8,449 A summary of past due loans as of December 31, 2018 are as follows (dollar amounts in thousands): 90 Days 30-89 Days or more Past Due Past Due 2018 Accruing and Accruing Non-Accrual Total Commercial/industrial $ 76 $ — $ 8,001 $ 8,077 Commercial real estate - owner occupied 59 — 10,311 10,370 Commercial real estate - non-owner occupied — 58 233 291 Construction and development — — — — Residential 1‑4 family 275 362 1,549 2,186 Consumer 9 3 5 17 Other — — — — $ 419 $ 423 $ 20,099 $ 20,941 |
Schedule of loans by risk rating | The breakdown of loans by risk rating as of December 31, 2019 is as follows (dollar amounts in thousands): Pass (1-5) 6 7 8 Total Commercial/industrial $ 290,180 $ 5,329 $ 7,029 $ — $ 302,538 Commercial real estate - owner occupied 422,336 5,603 31,843 — 459,782 Commercial real estate - non-owner occupied 344,278 8,774 671 — 353,723 Construction and development 132,266 — 30 — 132,296 Residential 1‑4 family 447,630 256 719 — 448,605 Consumer 29,430 — 32 — 29,462 Other 10,440 — — — 10,440 $ 1,676,560 $ 19,962 $ 40,324 $ — $ 1,736,846 The breakdown of loans by risk rating as of December 31, 2018 is as follows (dollar amounts in thousands): Pass (1-5) 6 7 8 Total Commercial/industrial $ 277,993 $ 7,309 $ 12,274 $ — $ 297,576 Commercial real estate - owner occupied 375,614 5,670 34,789 24 416,097 Commercial real estate - non-owner occupied 249,625 — 3,092 — 252,717 Construction and development 60,866 — 61 — 60,927 Residential 1‑4 family 364,289 664 3,718 2 368,673 Consumer 26,835 — 18 1 26,854 Other 6,369 — — — 6,369 $ 1,361,591 $ 13,643 $ 53,952 $ 27 $ 1,429,213 |
Schedule of impaired loans individually | A summary of impaired loans individually evaluated as of December 31, 2019 is as follows (dollar amounts in thousands): Commercial Commercial Real Estate - Real Estate - Construction Commercial / Owner Non-Owner and Residential Industrial Occupied Occupied Development 1-4 Family Consumer Other Total With an allowance recorded: Recorded investment $ 1,878 $ 960 $ — $ — $ — $ — $ — $ 2,838 Unpaid principal balance 1,878 960 — — — — — 2,838 Related allowance 760 80 — — — — — 840 With no related allowance recorded: Recorded investment $ — $ 2,938 $ — $ — $ — $ — $ — $ 2,938 Unpaid principal balance — 2,938 — — — — — 2,938 Related allowance — — — — — — — — Total: Recorded investment $ 1,878 $ 3,898 $ — $ — $ — $ — $ — $ 5,776 Unpaid principal balance 1,878 3,898 — — — — — 5,776 Related allowance 760 80 — — — — — 840 Average recorded investment $ 3,773 $ 5,847 $ — $ — $ 351 $ — $ — $ 9,971 A summary of impaired loans individually evaluated as of December 31, 2018 is as follows (dollar amounts in thousands): Commercial Commercial Real Estate - Real Estate - Construction Commercial / Owner Non-Owner and Residential Industrial Occupied Occupied Development 1‑4 Family Consumer Other Total With an allowance recorded: Recorded investment $ 5,667 $ 2,099 $ — $ — $ 523 $ — $ — $ 8,289 Unpaid principal balance 5,667 2,099 — — 523 — — 8,289 Related allowance 566 353 — — 160 — — 1,079 With no related allowance recorded: Recorded investment $ — $ 5,697 $ — $ — $ 179 $ — $ — $ 5,876 Unpaid principal balance — 5,697 — — 179 — — 5,876 Related allowance — — — — — — — — Total: Recorded investment $ 5,667 $ 7,796 $ — $ — $ 702 $ — $ — $ 14,165 Unpaid principal balance 5,667 7,796 — — 702 — — 14,165 Related allowance 566 353 — — 160 — — 1,079 Average recorded investment $ 2,834 $ 4,036 $ — $ — $ 706 $ — $ — $ 7,576 |
Schedule of interest income on impaired loans | An analysis of interest income on impaired loans for the years ended December 31 follows (dollar amounts in thousands): 2019 2018 2017 Interest income in accordance with orignial terms $ 651 $ 1,020 $ 113 Interest income recognized (129) (416) (109) Reduction in interest income $ 522 $ 604 $ 4 |
Schedule of Change in the accretable and non accretable Components of Discounts on Loans | The following table represents the change in the accretable and non-accretable components of discounts on loans acquired with deteriorated credit quality during the year ended December 31, 2019 and 2018: December 31, 2019 December 31, 2018 Accretable Non-accretable Accretable Non-accretable discount discount discount discount Balance at beginning of period $ 318 $ 745 $ 583 $ 800 Acquired balance, net 44 333 — — Reclassifications between accretable and non-accretable 858 (858) 55 (55) Accretion to loan interest income (998) — (320) — Disposals of loans — — — Balance at end of period $ 222 $ 220 $ 318 $ 745 |
Schedule of troubled debt restructurings | The following table presents the troubled debt restructurings during the year ended December 31, 2019: Pre-Modification Post-Modification Number of Outstanding Recorded Outstanding Recorded Contracts Investment Investment Commercial & Industrial 1 $ 113 $ 113 Commercial Real Estate 1 61 61 Residential 1-4 Family 2 372 196 Totals $ 546 $ 370 The following table presents the troubled debt restructurings during the year ended December 31, 2018: Pre-Modification Post-Modification Outstanding Outstanding Number of Recorded Recorded Contracts Investment Investment Commerical Real Estate $ 5,396 $ 5,044 |
Financial Asset Acquired with Credit Deterioration [Member] | |
LOANS, ALLOWANCE FOR LOAN LOSSES, AND CREDIT QUALITY | |
Schedule of impaired loans individually | The following table presents loans acquired with deteriorated credit quality as of December 31, 2019 and 2018. No loans in this table had a related allowance at December 31, 2019 and 2018, and therefore, the below disclosures were not expanded to include loans with and without a related allowance (dollar amounts in thousands). December 31, 2019 December 31, 2018 Recorded Unpaid Principal Recorded Unpaid Principal Investment Balance Investment Balance Commercial & Industrial $ 191 $ 212 $ 555 $ 701 Commercial real estate - owner occupied 518 785 1,558 2,069 Commercial real estate - non-owner occupied — — 233 475 Construction and development 213 237 171 171 Residential 1‑4 family 901 1,031 1,664 1,828 Consumer — — — — Other — — — — $ 1,823 $ 2,265 $ 4,181 $ 5,244 |
Related Party Matters (Tables)
Related Party Matters (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Matters | |
Summary of loans to directors, executive officers, principal shareholders, and their affiliates | A summary of loans to directors, executive officers, principal shareholders, and their affiliates for the years ended December 31 is as follows (dollar amounts in thousands): 2019 2018 Balances at beginning $ 84,103 $ 65,749 New loans and advances 27,886 59,684 Repayments (43,435) (41,330) Balance at end $ 68,554 $ 84,103 |
Mortgage Servicing Rights (Tabl
Mortgage Servicing Rights (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Mortgage Servicing Rights | |
Schedule of analysis of activity in the MSR asset | Following is an analysis of activity for the years ended December 31 in servicing rights assets that are measured at fair value (dollar amounts in thousands): 2019 2018 Fair value at beginning of year $ 3,085 $ 2,610 MSR asset acquired 1,859 — Servicing asset additions 740 356 Loan payments and payoffs (821) (475) Changes in valuation inputs and assumptions used in the valuation model (576) 594 Amount recognized through earnings (592) 475 Fair value at end of year $ 4,287 $ 3,085 Unpaid principal balance of loans serviced for others (in thousands) $ 554,374 $ 316,480 Mortgage servicing rights as a percent of loans serviced for others 0.77 0.97 |
Premises and Equipment (Tables)
Premises and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Premises and Equipment | |
Summary of analysis of premises and equipment | An analysis of premises and equipment at December 31 follows (dollar amounts in thousands): 2019 2018 Land and land improvements $ 4,584 $ 3,363 Buildings and building improvements 31,754 23,408 Furniture and equipment 5,360 6,177 Totals 41,698 32,948 Less accumulated depreciation 8,111 8,459 Right-of-use lease asset (see Note 21) 1,699 — Premises and equipment, net $ 35,286 $ 24,489 |
Other Real Estate Owned (Tables
Other Real Estate Owned (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Other Real Estate Owned | |
Changes in OREO during the period | Changes in OREO for the years ended December 31 were as follows (dollar amounts in thousands): 2019 2018 Beginning of year $ 3,592 $ 6,270 Transfers in 4,927 1,310 Gain (loss) on sale of OREO and valuation allowance 73 (252) Sales (1,704) (3,736) End of year $ 6,888 $ 3,592 |
Schedule of activity in the valuation allowance | Activity in the valuation allowance for the years ended December 31 was as follows (dollar amounts in thousands): 2019 2018 2017 Beginning of year $ 2,208 $ 2,078 $ 2,094 Additions charged to expense 13 130 — Valuation relieved due to sale of OREO (100) — (16) End of year $ 2,121 $ 2,208 $ 2,078 |
Identifiable Intangible Assets
Identifiable Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Identifiable Intangible Assets | |
Schedule of gross carrying amount and accumulated amortization of intangible assets (excluding goodwill) | The gross carrying amount and accumulated amortization of intangible assets (excluding goodwill) for the years ended December 31 are as follows (dollar amounts in thousands): 2019 2018 Gross Intangible Gross Intangible Carrying Accumulated Carrying Accumulated Amount Amortization Amount Amortization Core deposit intangible $ 7,333 $ 1,954 $ 3,097 $ 885 Mortgage servicing rights 4,287 — 3,085 — Totals $ 11,620 $ 1,954 $ 6,182 $ 885 |
Schedule of amortization expense | Mortgage servicing rights are carried at fair value; therefore, there is no amortization expense. The following table shows the estimated future amortization expense of amortizing intangible assets. The projections of amortization expense are based on existing asset balances as of December 31, 2019 (dollar amounts in thousands): Core Deposit Intangible 2020 $ 1,335 2021 1,130 2022 925 2023 720 2024 516 Thereafter 753 Total $ 5,379 |
Deposits (Tables)
Deposits (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Deposits | |
Schedule of composition of deposits | The composition of deposits at December 31 is as follows (dollar amounts in thousands): 2019 2018 Noninterest-bearing demand deposits $ 476,465 $ 448,765 Interest-bearing demand deposits 184,843 92,107 Savings deposits 792,997 616,138 Time deposits 373,430 382,450 Brokered certificates of deposit 15,576 17,707 Total deposits $ 1,843,311 $ 1,557,167 |
Schedule of maturities of time deposits | The scheduled maturities of time deposits at December 31, 2019, are summarized as follows (dollar amounts in thousands): 2020 $ 214,360 2021 113,074 2022 25,955 2023 25,161 2024 7,858 Thereafter 2,598 Total $ 389,006 |
Securities Sold Under Repurch_2
Securities Sold Under Repurchase Agreements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Securities Sold Under Repurchase Agreements | |
Schedule of securities sold under repurchase agreements | 2019 2018 2017 Outstanding balance at the end of the year $ 45,865 $ 31,489 $ 47,568 Weighted average interest rate at the end of the year 1.47 % 2.43 % 1.44 % Average balance during the year $ 21,522 $ 22,315 $ 26,537 Average interest rate during the year 2.14 % 1.79 % 1.01 % Maximum month end balance during the year $ 45,865 $ 48,010 $ 53,745 |
Notes Payable (Tables)
Notes Payable (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Notes Payable [Abstract] | |
Schedule of advance rate and maturities Table Text Block | Maturity Rate 2019 2018 (dollars in thousands) Fixed rate, fixed term 01/27/2020 1.42 % $ 1,000 $ — Fixed rate, fixed term 11/02/2020 1.28 % 400 — Fixed rate, fixed term 01/22/2021 1.67 % 2,000 — Fixed rate, fixed term 01/25/2021 2.37 % 5,000 — Fixed rate, fixed term 01/27/2021 1.60 % 1,000 — Fixed rate, fixed term 11/03/2021 1.46 % 400 — Fixed rate, fixed term 08/08/2022 1.76 % 10,000 — Fixed rate, fixed term 08/08/2023 1.74 % 10,000 — Fixed rate, fixed term 08/08/2024 1.75 % 10,000 — $ 39,800 $ — |
Schedule of Future maturities of borrowings Table Text Block | Future maturities of borrowings at December 31, 2019, were as follows (dollars in thousands): 2020 $ 1,400 2021 8,400 2022 10,000 2023 10,000 2024 10,000 $ 39,800 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Taxes | |
Schedule of components of income tax expense (benefit) | The components of the provision for income taxes for the years ended December 31 are as follows (dollar amounts in thousands): 2019 2018 2017 Current tax expense: Federal $ 4,327 $ 3,349 $ 6,340 State 2,412 2,100 1,862 Total current 6,739 5,449 8,202 Deferred tax expenses (benefit): Impact of change in tax rate from tax legislation — — 642 Federal 620 815 (12) State 236 333 (6) Total deferred 856 1,148 624 Total provision for income taxes $ 7,595 $ 6,597 $ 8,826 |
Schedule of effective income tax rate reconciliation | A summary of the sources of differences between income taxes at the federal statutory rate and the provision for income taxes for the years ended December 31 follows (dollar amounts in thousands): 2019 2018 2017 Tax expense at statutory rate $ 7,201 $ 6,731 $ 8,449 Increase (decrease) in taxes resulting from: Tax-exempt interest (1,320) (1,105) (1,279) State taxes (net of Federal benefit) 1,923 1,674 1,210 Cash surrender value of life insurance (131) (128) (192) ESOP dividend (93) (81) (121) Tax credits (39) (91) (117) Nondeductible expenses associated with acquisition — — 160 Deferred tax rate differential from tax legislation — — 642 Other 54 (403) 74 Total provision for income taxes $ 7,595 $ 6,597 $ 8,826 |
Schedule of deferred tax assets and liabilities | The major components of the net deferred tax asset (liability) as of December 31 are presented below (dollar amounts in thousands): 2019 2018 Deferred tax assets: Deferred compensation $ 1,036 $ 1,089 Premises and equipment 398 214 Allowance for loan losses 3,104 3,336 Accrued vacation and severance 35 36 Other real estate owned 360 352 Unrealized loss on securities available for sale — 97 Other 244 95 Total deferred tax assets 5,177 5,219 Deferred tax liabilities: Investment in acquisition and discount accretion (148) (162) Mortgage servicing rights (1,168) (840) Other investments (248) (209) Prepaid expenses (63) (66) Investment in minority owned subsidiaries (2,509) (2,238) Goodwill and other intangibles (1,000) (1,049) Purchase accounting (339) — Unrealized gain on securities available for sale (743) — Total deferred tax liabilities (6,218) (4,564) Net deferred tax (liability) asset $ (1,041) $ 655 |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Employee Benefit Plans | |
Schedule of share-based compensation, restricted stock and restricted stock units activity | For the year ended For the year ended December 31, 2019 December 31, 2018 Weighted- Weighted- Average Grant- Average Grant- Shares Date Fair Value Shares Date Fair Value Restricted Stock Outstanding at beginning of year 51,776 $ 34.27 53,619 $ 26.59 Granted 17,015 56.62 17,982 46.55 Vested (17,212) 30.54 (19,825) 24.36 Forfeited or cancelled (903) 41.01 — — Outstanding at end of year 50,676 $ 43.03 51,776 $ 34.27 |
Stockholders' Equity and Regu_2
Stockholders' Equity and Regulatory Matters (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Stockholders' Equity and Regulatory Matters | |
Schedule of Actual and required capital amounts and ratios | Actual and required capital amounts and ratios are presented below (dollar amounts in thousands): To Be Well Minimum Capital Capitalized Under For Capital Adeqaucy with Prompt Corrective Actual Adequacy Purposes Capital Buffer Action Provisions Amount Ratio Amount Ratio Amount Ratio Amount Ratio December 31, 2019 Total capital (to risk-weighted assets): Corporation $ 208,900 10.35 % NA NA NA NA NA NA Bank $ 215,347 10.69 % $ 161,163 8.00 % $ 211,527 10.50 % $ 201,454 10.00 % Tier 1 capital (to risk-weighted assets): Corporation $ 178,882 8.86 % NA NA NA NA NA NA Bank $ 203,951 10.12 % $ 120,872 6.00 % $ 171,236 8.50 % $ 161,163 8.00 % Common Equity Tier 1 capital (to risk-weighted assets): Corporation $ 178,882 8.86 % NA NA NA NA NA NA Bank $ 203,951 10.12 % $ 90,654 4.50 % $ 141,018 7.00 % $ 130,945 6.50 % Tier 1 capital (to average assets): Corporation $ 178,882 8.46 % NA NA NA NA NA NA Bank $ 203,951 9.67 % $ 84,390 4.00 % $ 84,390 4.00 % $ 105,487 5.00 % To Be Well Minimum Capital Capitalized Under For Capital Adequacy with Prompt Corrective Actual Adequacy Purposes Capital Buffer Action Provisions Amount Ratio Amount Ratio Amount Ratio Amount Ratio December 31, 2018 Total capital (to risk-weighted assets): Corporation $ 181,201 11.35 % NA NA NA NA NA NA Bank $ 178,668 11.21 % $ 127,497 8.00 % $ 157,459 9.88 % $ 159,372 10.00 % Tier 1 capital (to risk-weighted assets): Corporation $ 157,453 9.86 % NA NA NA NA NA NA Bank $ 166,420 10.44 % $ 95,623 6.00 % $ 125,585 7.88 % $ 127,497 8.00 % Common Equity Tier 1 capital (to risk-weighted assets): Corporation $ 157,453 9.86 % NA NA NA NA NA NA Bank $ 166,420 10.44 % $ 71,717 4.50 % $ 101,679 6.38 % $ 103,592 6.50 % Tier 1 capital (to average assets): Corporation $ 157,453 9.06 % NA NA NA NA NA NA Bank $ 166,420 9.59 % $ 69,410 4.00 % 69,410 4.00 % $ 86,762 5.00 % |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies | |
Schedule of Commitments and contingencies outstanding | The following commitments were outstanding at December 31 (dollar amounts in thousands): Notional Amount 2019 2018 Commitments to extend credit: Fixed $ 49,741 $ 57,911 Variable 333,468 268,541 Credit card arrangements 11,148 7,119 Letters of credit 17,121 25,261 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases | |
Schedule of lease cost and other information related to leases | Year ended December 31, 2019 (dollar amounts in Thousands) Amortization of ROU Assets - Operating Leases $ 45 Interest on Lease Liabilities - Operating Leases 87 Operating Lease Cost (Cost resulting from lease payments) 132 New ROU Assets - Operating Leases 1,744 Weighted Average Lease Term (Years) - Operating Leases 31.56 Weighted Average Discount Rate - Operating Leases 5.50 % |
Schedule of maturity analysis of operating lease liabilities | A maturity analysis of operating lease liabilities and reconciliation of the undiscounted cash flows to the total operating lease liabilities as of December 31, 2019 is as follows (dollar amounts in thousands): December 31, 2019 Operating lease payments due: Within one year $ 133 After one but within two years 140 After two but within three years 113 After three but within four years 86 After four years but within five years 86 After five years 3,411 Total undiscounted cash flows 3,969 Discount on cash flows (2,270) Total operating lease liabilities $ 1,699 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value of Financial Instruments | |
Schedule of fair value of assets measured at fair value on a recurring basis | Information regarding the fair value of assets measured at fair value on a recurring basis is as follows (dollar amounts in thousands): Instruments Markets Other Significant Measured for Identical Observable Unobservable At Fair Assets Inputs Inputs Value (Level 1) (Level 2) (Level 3) December 31, 2019 Assets Securities available for sale Obligations of U.S.Government sponsored agencies $ 12,060 $ — $ 12,060 $ — Obligations of states and political subdivisions 54,771 — 54,771 — Mortgage-backed securities 51,720 — 51,720 — Corporate notes 62,955 — 62,955 — Mortgage servicing rights 4,287 — 4,287 — December 31, 2018 Assets Securities available for sale Obligations of states and political subdivisions $ 51,893 $ — $ 51,493 $ 400 Mortgage-backed securities 50,569 — 50,569 — Corporate notes 16,444 — 16,444 — Mortgage servicing rights 3,085 — 3,085 — |
Schedule of fair value of assets measured on a recurring basis using significant unobservable inputs | Fair value of assets measured on a recurring basis using significant unobservable inputs (Level 3) are as follows (dollar amounts in thousands): 2019 2018 Total securities at beginning of year $ 400 $ 500 Included in earnings — — Included in other comprehensive income — — Purchases, issuance, and settlements (400) (100) Transfer in and/or out of level 3 — — Total securities at end of year $ — $ 400 |
Schedule of fair value of assets measured on a non-recurring basis | Information regarding the fair value of assets measured at fair value on a non-recurring basis is as follows (dollar amounts in thousands): Quoted Prices In Active Significant Assets Markets Other Significant Measured for Identical Observable Unobservable At Fair Assets Inputs Inputs Value (Level 1) (Level 2) (Level 3) December 31, 2019 OREO $ 6,888 $ — $ — $ 6,888 Impaired Loans, net of impairment reserve 6,847 — — 6,847 $ 13,735 $ — $ — $ 13,735 December 31, 2018 OREO $ 3,592 $ — $ — $ 3,592 Impaired Loans, net of impairment reserve 20,872 — — 20,872 $ 24,464 $ — $ — $ 24,464 |
Schedule of fair value measurement on inputs and valuation techniques | The following table shows significant unobservable inputs used in the fair value measurement of Level 3 assets: Weighted Range of Average Valuation Technique Unobservable Inputs Discounts Discount As of December 31, 2019 OREO Third party appraisals, sales contracts or brokered price opinions Collateral discounts and estimated costs to sell 0% - 61 % 33.5 % Impaired loans Third party appraisals and discounted cash flows Collateral discounts and discount rates 0% - 100 % 6.1 % As of December 31, 2018 OREO Third party appraisals, sales contracts or brokered price opinions Collateral discounts and estimated costs to sell 0% - 40 % 18.6 % Impaired loans Third party appraisals and discounted cash flows Collateral discounts and discount rates 0% - 100 % 9.3 % |
Schedule of carrying value and estimated fair value of financial instruments | The carrying value and estimated fair value of financial instruments at December 31 follows (dollar amounts in thousands): Fair Value Carrying amount Level 1 Level 2 Level 3 Total December 31, 2019 Financial assets: Cash and cash equivalents $ 86,452 $ 86,452 $ — $ — $ 86,452 Securities held to maturity 43,734 — 44,803 — 44,803 Securities available for sale 181,506 — 181,506 — 181,506 Loans held for sale 587 — — 587 587 Loans, net 1,724,947 — — 1,723,542 1,723,542 Other investments, at cost 4,933 — — 4,933 4,933 Mortgage servicing rights 4,287 — 4,287 — 4,287 Cash surrender value of life insurance 24,945 24,945 — — 24,945 Financial liabilities: Deposits $ 1,843,311 $ — $ — $ 1,783,638 $ 1,783,638 Securities sold under repurchase agreements 45,865 — 45,865 — 45,865 Notes payable 49,790 — 49,790 — 49,790 Subordinated notes 18,622 — 18,622 — 18,622 Fair Value Carrying amount Level 1 Level 2 Level 3 Total December 31, 2018 Financial assets: Cash and cash equivalents $ 107,743 $ 107,743 $ — $ — $ 107,743 Securities held to maturity 40,768 — 40,477 — 40,477 Securities available for sale 118,906 — 118,506 400 118,906 Loans, net 1,416,246 — — 1,400,538 1,400,538 Other investments, at cost 4,555 — — 4,555 4,555 Mortgage servicing rights 3,085 — 3,085 — 3,085 Cash surrender value of life insurance 24,178 24,178 — — 24,178 Financial liabilities: Deposits $ 1,557,167 $ — $ — $ 1,449,552 $ 1,449,552 Securities sold under repurchase agreements 31,489 — 31,489 — 31,489 Subordinated notes 11,500 — 11,500 — 11,500 |
Parent Company Only Financial_2
Parent Company Only Financial Statements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Parent Company Only Financial Statements | |
Condensed Balance Sheet | Balance Sheets December 31 2019 2018 (In Thousands) Assets Cash and cash equivalents $ 63 $ 72 Investment in Bank 254,299 183,290 Investment in Veritas 4,852 2,381 Other assets 557 978 TOTAL ASSETS $ 259,771 $ 186,721 Liabilities and Stockholders’ Equity Liabilities Notes payable $ 10,000 $ — Subordinated notes 18,500 11,500 Other liabilities 1,060 898 Total liabilities 29,560 12,398 Stockholders’ equity: Common stock 79 74 Additional paid-in capital 63,085 27,601 Retained earnings 189,494 168,363 Treasury stock, at cost (24,941) (21,349) Accumulated other comprehensive income 2,494 (366) Total stockholders’ equity 230,211 174,323 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 259,771 $ 186,721 |
Condensed Income Statement | Statements of Income Years Ended December 31 2019 2018 2017 (In Thousands) Income: Dividends received from Bank $ 16,335 $ 22,275 $ 19,480 Equity in undistributed earnings of subsidiaries 11,361 4,029 (3,773) Other income 234 74 — Total income 27,930 26,378 15,707 Other expenses 1,611 1,404 648 Benefit for income taxes (375) (482) (254) Net income $ 26,694 $ 25,456 $ 15,313 |
Condensed Cash Flow Statement | Statements of Cash Flows Years Ended December 31, 2019 2018 2017 (In thousands) Cash flow from operating activities: Net income $ 26,694 $ 25,456 $ 15,313 Adjustments to reconcile net income to net cash provided by operating activities: Stock compensation 685 556 465 Equity in earnings of subsidiaries (includes dividends) (27,696) (26,304) (15,707) Changes in other assets and liabilities: Other assets (329) (49) (44) Other liabilities (33) (90) 457 Net cash provided by (used in) operating activities (679) (431) 484 Cash flows from investing activities, net of effects of business combination: Sale of other investments 750 — — Dividends received from Bank 16,335 22,275 19,480 Dividends received from Veritas — — 450 Net cash used in business combination (14,241) — (33,378) Contribution to subsidiaries (2,620) — — Net cash provided by (used in) investing activities 224 22,275 (13,448) Cash flows from financing activities, net of effects of business combination: Proceeds from (repayment of) revolving line of credit 10,000 (5,000) 5,000 Proceeds from (repayment of) senior term debt — (3,500) 3,500 Proceeds from subordinated notes — — 11,500 Cash dividends paid (5,463) (4,530) (4,046) Issuance of common stock 114 1,347 896 Repurchase of common stock (4,205) (10,449) (3,631) Net cash provided by (used in) financing activities 446 (22,132) 13,219 Net increase (decrease) in cash and cash equivalents (9) (288) 255 Cash and cash equivalents at beginning 72 360 105 Cash and cash equivalents at end $ 63 $ 72 $ 360 Supplemental schedule of noncash activities: Amortization of unrealized holding gains on securities transferred from available for sale to held to maturity recognized in other comprehensive income, net of tax $ (35) $ (60) $ (80) Change in unrealized gains and losses on investment securities available for sale, net of tax 2,958 (1,367) 604 |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Common Share | |
Schedule of Earnings Per Common Share | Earnings per common share, earnings per share assuming dilution,and related information are summarized as follows: Years ended December 31, 2019 2018 2017 Net income from operations (in thousands) $ 26,694 $ 25,456 $ 15,313 Weighted average common shares outstanding 6,820,225 6,673,758 6,285,901 Effect of dilutive potential common shares 82,391 — — Diluted weighted average common shares outstanding 6,902,616 6,673,758 6,285,901 Earnings per share - basic $ $ $ Earnings per share - diluted $ $ $ |
Quarterly Results of Operatio_2
Quarterly Results of Operations (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information | 2019 Quarters Fourth Third Second First (Dollars in Thousands, Except Share and Per Share Data) Interest income $ 23,795 $ 25,489 $ 20,158 $ 19,723 Interest expense 5,015 5,176 4,784 4,523 Net interest and dividend income 18,780 20,313 15,374 15,200 Provision for loan losses 1,125 3,000 500 625 Net interest and dividend income after provision for loan losses 17,655 17,313 14,874 14,575 Noninterest income 3,211 3,145 2,736 3,540 Noninterest expense 11,182 12,087 9,955 9,536 Income before provision for income taxes 9,684 8,371 7,655 8,579 Provision for income taxes 2,225 1,712 1,666 1,992 Net income $ 7,459 $ 6,659 $ 5,989 $ 6,587 Share data Average shares outstanding, basic 7,084,728 7,036,807 6,577,016 6,574,362 Average shares outstanding, diluted 7,182,854 7,134,674 6,675,794 6,608,273 Earnings per share, basic $ 1.05 $ 0.95 $ 0.91 $ 1.00 Earnings per share, diluted $ 1.04 $ 0.93 $ 0.90 $ 1.00 2018 Quarters Fourth Third Second First (Dollars in Thousands, Except Share and Per Share Data) Interest income $ 19,753 $ 19,510 $ 19,372 $ 19,309 Interest expense 4,240 3,974 3,604 3,027 Net interest and dividend income 15,513 15,536 15,768 16,282 Provision for loan losses 750 800 900 485 Net interest and dividend income after provision for loan losses 14,763 14,736 14,868 15,797 Noninterest income 2,553 2,508 3,027 3,443 Noninterest expense 9,893 9,708 10,064 9,977 Income before provision for income taxes 7,423 7,536 7,831 9,263 Provision for income taxes 1,362 1,604 1,431 2,200 Net income $ 6,061 $ 5,932 $ 6,400 $ 7,063 Share data Average shares outstanding, basic and diluted 6,647,586 6,661,337 6,672,344 6,714,347 Earnings per share, basic and diluted $ 0.91 $ 0.89 $ 0.96 $ 1.05 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Building Improvements [Member] | |
Property, Plant and Equipment, Useful Life | 40 years |
Land Improvements [Member] | |
Property, Plant and Equipment, Useful Life | 20 years |
Furniture and Fixtures [Member] | Maximum [Member] | |
Property, Plant and Equipment, Useful Life | 7 years |
Furniture and Fixtures [Member] | Minimum [Member] | |
Property, Plant and Equipment, Useful Life | 2 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details Textual) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash, FDIC Insured Amount | $ 250,000 | ||
Cash, Uninsured Amount | 1,900,000 | $ 1,013,000 | |
Cash Pass-through Reserve, Federal Home Loan Bank | 26,184,000 | 28,302,000 | |
Loans and Leases Receivable, Allowance | $ 11,396,000 | $ 12,248,000 | $ 11,612,000 |
Weighted Average Number of Shares Outstanding, Diluted | 6,902,616 | 6,673,758 | 6,285,901 |
Cumulative Effect on Retained Earnings, Net of Tax | $ 1,588,000 | ||
Reclassification from AOCI, Current Period, Tax | 82,391 | $ 0 | |
Non-homogenous loans [Member] | Minimum [Member] | |||
Loans and Leases Receivable, Allowance | $ 250,000 | ||
UFSLLC [Member] | |||
Noncontrolling Interest, Ownership Percentage by Parent | 49.80% | ||
Ansay Associates LLC [Member] | |||
Noncontrolling Interest, Ownership Percentage by Parent | 40.00% |
Acquisitions - Fair value of as
Acquisitions - Fair value of assets and liabilities (Details) - USD ($) | Jul. 12, 2019 | Oct. 27, 2017 | Dec. 31, 2019 | Dec. 31, 2018 |
Cash and cash equivalents | $ 21,156,000 | $ 61,774,000 | ||
Other investments | 441,000 | |||
Loans | 275,322,000 | 339,264,000 | ||
Premises and equipment, net | 3,126,000 | 3,556,000 | ||
Other real estate owned | 2,708,000 | |||
Core deposit intangible | 4,236,000 | 3,097,000 | ||
Other assets | 3,487,000 | 7,836,000 | ||
Total assets acquired | 307,768,000 | 418,235,000 | ||
Deposits | 268,807,000 | 345,608,000 | ||
Subordinated debt | 7,195,000 | |||
Other borrowings | 9,782,000 | |||
Other liabilities | 828,000 | 1,668,000 | ||
Total liabilities assumed | 286,612,000 | 347,276,000 | ||
Excess of assets acquired over liabilities assumed | 21,156,000 | 70,959,000 | ||
Less: purchase price | 49,588,000 | 78,060,000 | ||
Goodwill | 28,432,000 | 7,101,000 | $ 43,456,000 | $ 15,024,000 |
Refinement to fair value estimates during 2018 | (61,000) | |||
Goodwill (after refinement) | 7,040,000 | |||
Partnership Community Bancshares, Inc. [Member] | ||||
Cash and cash equivalents | 21,447,000 | |||
Other investments | 441,000 | |||
Loans | 276,279,000 | |||
Premises and equipment, net | 6,066,000 | |||
Other assets | 3,668,000 | |||
Total assets acquired | 307,901,000 | |||
Deposits | 268,653,000 | |||
Subordinated debt | 7,000,000 | |||
Other borrowings | 9,800,000 | |||
Other liabilities | 841,000 | |||
Total liabilities assumed | 286,294,000 | |||
Excess of assets acquired over liabilities assumed | 21,607,000 | |||
Less: purchase price | 49,588,000 | |||
Fair Value Adjustments [Member] | ||||
Cash and cash equivalents | (291,000) | (400,000) | ||
Loans | (957,000) | 1,716,000 | ||
Premises and equipment, net | (2,940,000) | (4,105,000) | ||
Other real estate owned | (640,000) | |||
Core deposit intangible | 4,236,000 | 3,097,000 | ||
Other assets | (181,000) | (346,000) | ||
Total assets acquired | (133,000) | (678,000) | ||
Deposits | 154,000 | 810,000 | ||
Subordinated debt | 195,000 | |||
Other borrowings | (18,000) | |||
Other liabilities | (13,000) | 63,000 | ||
Total liabilities assumed | 318,000 | 873,000 | ||
Excess of assets acquired over liabilities assumed | $ (451,000) | (1,551,000) | ||
Waupaca Bancorporation Inc [Member] | ||||
Cash and cash equivalents | 62,174,000 | |||
Loans | 337,548,000 | |||
Premises and equipment, net | 7,661,000 | |||
Other real estate owned | 3,348,000 | |||
Other assets | 8,182,000 | |||
Total assets acquired | 418,913,000 | |||
Deposits | 344,798,000 | |||
Other liabilities | 1,605,000 | |||
Total liabilities assumed | 346,403,000 | |||
Excess of assets acquired over liabilities assumed | $ 72,510,000 | |||
Goodwill | $ 28,432,000 |
Acquisition - Additional Inform
Acquisition - Additional Information (Details) - USD ($) | Jul. 12, 2019 | Oct. 27, 2017 |
Merger consideration | $ 49,588,000 | $ 78,060,000 |
Partnership Community Bancshares, Inc. [Member] | ||
Merger consideration | $ 49,588,000 |
Securities - Securities availab
Securities - Securities available for sale (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Marketable Securities [Line Items] | ||
Available for sale securities, Amortized Cost | $ 178,376 | $ 119,519 |
Available for sale securities, Gross Unrealized Gains | 3,357 | 775 |
Available for sale securities, Gross Unrealized Losses | (227) | (1,388) |
Available for sale securities, Estimated Fair Value | 181,506 | 118,906 |
Corporate notes [Member] | ||
Marketable Securities [Line Items] | ||
Available for sale securities, Amortized Cost | 62,794 | 16,708 |
Available for sale securities, Gross Unrealized Gains | 172 | 0 |
Available for sale securities, Gross Unrealized Losses | (11) | (264) |
Available for sale securities, Estimated Fair Value | 62,955 | 16,444 |
Obligations of U.S.Government sponsored agencies | ||
Marketable Securities [Line Items] | ||
Available for sale securities, Amortized Cost | 12,218 | |
Available for sale securities, Gross Unrealized Gains | 0 | |
Available for sale securities, Gross Unrealized Losses | (158) | |
Available for sale securities, Estimated Fair Value | 12,060 | |
Obligations of states and political subdivisions [Member] | ||
Marketable Securities [Line Items] | ||
Available for sale securities, Amortized Cost | 52,594 | 51,292 |
Available for sale securities, Gross Unrealized Gains | 2,197 | 709 |
Available for sale securities, Gross Unrealized Losses | (20) | (108) |
Available for sale securities, Estimated Fair Value | 54,771 | 51,893 |
Mortgage-backed securities [Member] | ||
Marketable Securities [Line Items] | ||
Available for sale securities, Amortized Cost | 50,770 | 51,519 |
Available for sale securities, Gross Unrealized Gains | 988 | 66 |
Available for sale securities, Gross Unrealized Losses | (38) | (1,016) |
Available for sale securities, Estimated Fair Value | $ 51,720 | $ 50,569 |
Securities - Securities held to
Securities - Securities held to maturity (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Marketable Securities [Line Items] | ||
Held to maturity securities, Amortized Cost | $ 43,734 | $ 40,768 |
Held to maturity securities, Gross Unrealized Gains | 1,091 | 98 |
Held to maturity securities, Gross Unrealized Losses | (22) | (389) |
Held to Maturity Total, Estimated Fair Value | 44,803 | 40,477 |
U.S. Treasury securities [Member] | ||
Marketable Securities [Line Items] | ||
Held to maturity securities, Amortized Cost | 33,527 | 28,975 |
Held to maturity securities, Gross Unrealized Gains | 1,076 | 92 |
Held to maturity securities, Gross Unrealized Losses | (22) | (389) |
Held to Maturity Total, Estimated Fair Value | 34,581 | 28,678 |
Obligations of states and political subdivisions [Member] | ||
Marketable Securities [Line Items] | ||
Held to maturity securities, Amortized Cost | 10,207 | 11,793 |
Held to maturity securities, Gross Unrealized Gains | 15 | 6 |
Held to maturity securities, Gross Unrealized Losses | 0 | 0 |
Held to Maturity Total, Estimated Fair Value | $ 10,222 | $ 11,799 |
Securities - Fair value and gro
Securities - Fair value and gross unrealized losses (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Marketable Securities [Line Items] | ||
Available for Sale, Less Than 12 Months Fair Value | $ 25,658 | $ 23,376 |
Available for Sale, Greater Than 12 Months Fair Value | 3,186 | 48,381 |
Available for Sale, Total Fair Value | 28,844 | 71,757 |
Available for Sale, Less Than 12 Months Unrealized Losses | (214) | (247) |
Available for Sale, Greater Than 12 Months Unrealized Losses | (13) | (1,141) |
Available for Sale, Total Unrealized Losses | (227) | (1,388) |
Corporate notes [Member] | ||
Marketable Securities [Line Items] | ||
Available for Sale, Less Than 12 Months Fair Value | 3,925 | 0 |
Available for Sale, Greater Than 12 Months Fair Value | 0 | 12,531 |
Available for Sale, Total Fair Value | 3,925 | 12,531 |
Available for Sale, Less Than 12 Months Unrealized Losses | (11) | 0 |
Available for Sale, Greater Than 12 Months Unrealized Losses | 0 | (264) |
Available for Sale, Total Unrealized Losses | (11) | (264) |
Obligations of U.S.Government sponsored agencies | ||
Marketable Securities [Line Items] | ||
Available for Sale, Less Than 12 Months Fair Value | 12,059 | |
Available for Sale, Greater Than 12 Months Fair Value | 0 | |
Available for Sale, Total Fair Value | 12,059 | |
Available for Sale, Less Than 12 Months Unrealized Losses | (158) | |
Available for Sale, Greater Than 12 Months Unrealized Losses | 0 | |
Available for Sale, Total Unrealized Losses | (158) | |
Obligations of states and political subdivisions [Member] | ||
Marketable Securities [Line Items] | ||
Available for Sale, Less Than 12 Months Fair Value | 5,636 | 10,024 |
Available for Sale, Greater Than 12 Months Fair Value | 999 | 4,132 |
Available for Sale, Total Fair Value | 6,635 | 14,156 |
Available for Sale, Less Than 12 Months Unrealized Losses | (19) | (64) |
Available for Sale, Greater Than 12 Months Unrealized Losses | (1) | (44) |
Available for Sale, Total Unrealized Losses | (20) | (108) |
Mortgage-backed securities [Member] | ||
Marketable Securities [Line Items] | ||
Available for Sale, Less Than 12 Months Fair Value | 4,038 | 13,352 |
Available for Sale, Greater Than 12 Months Fair Value | 2,187 | 31,718 |
Available for Sale, Total Fair Value | 6,225 | 45,070 |
Available for Sale, Less Than 12 Months Unrealized Losses | (26) | (183) |
Available for Sale, Greater Than 12 Months Unrealized Losses | (12) | (833) |
Available for Sale, Total Unrealized Losses | (38) | (1,016) |
U.S. Treasury securities [Member] | ||
Marketable Securities [Line Items] | ||
Held to Maturity, Less Than 12 Months Fair Value | 2,958 | 8,422 |
Held to Maturity, Greater Than 12 Months Fair Value | 0 | 11,580 |
Held to Maturity, Total Fair Value | 2,958 | 20,002 |
Held to Maturity, Less Than 12 Months Unrealized Losses | (22) | (46) |
Held to Maturity, Greater Than 12 Months Unrealized Losses | 0 | (343) |
Held to Maturity, Total Unrealized Losses | $ (22) | $ (389) |
Securities - Summary of amortiz
Securities - Summary of amortized cost and estimated fair value (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Securities | ||
Available for Sale Due in one year or less, Amortized Cost | $ 47,437 | |
Available for Sale Due after one year through five years, Amortized Cost | 23,339 | |
Available for Sale Due after five years through ten years, Amortized Cost | 13,153 | |
Available for Sale Due after ten years, Amortized Cost | 43,677 | |
Available for Sale Subtotal, Amortized Cost | 127,606 | |
Available for Sale Mortgage-backed securities, Amortized Cost | 50,770 | |
Available for sale securities, Amortized Cost | 178,376 | $ 119,519 |
Available for Sale Due in one year or less, Estimated Fair Value | 47,446 | |
Available for Sale Due after one year through five years, Estimated Fair Value | 23,783 | |
Available for Sale Due after five years through ten years, Estimated Fair Value | 13,843 | |
Available for Sale Due after ten years, Estimated Fair Value | 44,714 | |
Available for Sale Subtotal, Estimated Fair Value | 129,786 | |
Available for Sale Mortgage-backed securities, Estimated Fair Value | 51,720 | |
Available for sale securities, Estimated Fair Value | 181,506 | 118,906 |
Held to Maturity Due in one year or less, Amortized Cost | 4,136 | |
Held to Maturity Due after one year through five years, Amortized Cost | 16,777 | |
Held to Maturity Due after five years through ten years, Amortized Cost | 19,912 | |
Held to Maturity Due after ten years, Amortized Cost | 2,909 | |
Held to Maturity Subtotal, Amortized Cost | 43,734 | |
Held to Maturity Mortgage-backed securities, Amortized Cost | 0 | |
Held to maturity securities, Amortized Cost | 43,734 | 40,768 |
Held to Maturity Due in one year or less, Estimated Fair Value | 4,151 | |
Held to Maturity Due after one year through five years, Estimated Fair Value | 17,120 | |
Held to Maturity Due after five years through ten years, Estimated Fair Value | 20,623 | |
Held to Maturity Due after ten years, Estimated Fair Value | 2,909 | |
Held to Maturity Subtotal, Estimated Fair Value | 44,803 | |
Held to Maturity Mortgage-backed securities, Estimated Fair Value | 0 | |
Held to Maturity Total, Estimated Fair Value | $ 44,803 | $ 40,477 |
Securities - Summary of proceed
Securities - Summary of proceeds from sales securities (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Securities | |||
Proceeds from sales of securities | $ 45,506 | $ 4,467 | $ 48,906 |
Gross gains on sales | 657 | 41 | 73 |
Gross losses on sales | $ (23) | $ (72) | $ (105) |
Securities (Details Textual)
Securities (Details Textual) $ in Thousands | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) |
Carrying Value of Federal Funds Purchased, Securities Sold under Agreements to Repurchase, and Deposits Received for Securities Loaned | $ 137,640,000 | $ 69,679,000 |
U.S. Treasury securities [Member] | ||
Debt Securities, Available-for-sale, Unrealized Loss Position, Number of Positions | 1 | |
Debt Securities Number Of Positions | 15 | |
Obligations of states and political subdivisions [Member] | ||
Debt Securities, Available-for-sale, Unrealized Loss Position, Number of Positions | 5 | |
Debt Securities Number Of Positions | 5 | |
Mortgage-backed securities [Member] | ||
Debt Securities, Available-for-sale, Unrealized Loss Position, Number of Positions | 8 | |
Debt Securities Number Of Positions | 82 | |
Corporate notes [Member] | ||
Debt Securities, Available-for-sale, Unrealized Loss Position, Number of Positions | 1 | |
Debt Securities Number Of Positions | 7 |
Loans (Details)
Loans (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Loans and Leases Receivable, Gross | $ 1,736,846 | $ 1,429,213 | |
ALL | (11,396) | (12,248) | $ (11,612) |
Loans, net of ALL | 1,725,450 | 1,416,965 | |
Deferred loan fees and costs | (503) | (719) | |
Loans, net | 1,724,947 | 1,416,246 | |
Other | |||
Loans and Leases Receivable, Gross | 10,440 | 6,369 | |
ALL | (53) | (32) | (23) |
Construction and Development | |||
Loans and Leases Receivable, Gross | 132,296 | 60,927 | |
ALL | (548) | (725) | (945) |
Commercial/Industrial | |||
Loans and Leases Receivable, Gross | 302,538 | 297,576 | |
ALL | (2,320) | (3,021) | (2,362) |
Commercial Real Estate-Owner Occupied | |||
Loans and Leases Receivable, Gross | 459,782 | 416,097 | |
ALL | (4,587) | (3,750) | (3,376) |
Commercial Real Estate-Non-Owner Occupied | |||
Loans and Leases Receivable, Gross | 353,723 | 252,717 | |
ALL | (1,578) | (2,100) | (1,987) |
Residential 14 Family | |||
Loans and Leases Receivable, Gross | 448,605 | 368,673 | |
ALL | (2,169) | (2,472) | (2,728) |
Consumer | |||
Loans and Leases Receivable, Gross | 29,462 | 26,854 | |
ALL | $ (141) | $ (148) | $ (191) |
Loans - Allowance for Credit Lo
Loans - Allowance for Credit Losses on Financial Receivables (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
ALL - January 1, 2019 | $ 12,248 | $ 11,612 | |
Charge-offs | (6,678) | (2,717) | |
Recoveries | 576 | 418 | |
Provision | 5,250 | 2,935 | $ 1,055 |
ALL - September 30, 2019 | 11,396 | 12,248 | 11,612 |
ALL ending balance individually evaluated for impairment | 840 | 1,079 | |
ALL ending balance collectively evaluated for impairment | 10,556 | 11,169 | |
Loans outstanding - September 30, 2019 | 1,736,846 | 1,429,213 | |
Loans ending balance individually evaluated for impairment | 2,838 | 14,165 | |
Loans ending balance collectively evaluated for impairment | 1,734,008 | 1,415,048 | |
Other | |||
ALL - January 1, 2019 | 32 | 23 | |
Charge-offs | (41) | (37) | |
Recoveries | 8 | 10 | |
Provision | 54 | 36 | |
ALL - September 30, 2019 | 53 | 32 | 23 |
ALL ending balance individually evaluated for impairment | 0 | 0 | |
ALL ending balance collectively evaluated for impairment | 53 | 32 | |
Loans outstanding - September 30, 2019 | 10,440 | 6,369 | |
Loans ending balance individually evaluated for impairment | 0 | 0 | |
Loans ending balance collectively evaluated for impairment | 10,440 | 6,369 | |
Construction and Development | |||
ALL - January 1, 2019 | 725 | 945 | |
Charge-offs | 0 | (83) | |
Recoveries | 0 | 0 | |
Provision | (177) | (137) | |
ALL - September 30, 2019 | 548 | 725 | 945 |
ALL ending balance individually evaluated for impairment | 0 | 0 | |
ALL ending balance collectively evaluated for impairment | 548 | 725 | |
Loans outstanding - September 30, 2019 | 132,296 | 60,927 | |
Loans ending balance individually evaluated for impairment | 0 | 0 | |
Loans ending balance collectively evaluated for impairment | 132,296 | 60,927 | |
Commercial/Industrial | |||
ALL - January 1, 2019 | 3,021 | 2,362 | |
Charge-offs | (1,229) | (35) | |
Recoveries | 11 | 2 | |
Provision | 517 | 692 | |
ALL - September 30, 2019 | 2,320 | 3,021 | 2,362 |
ALL ending balance individually evaluated for impairment | 760 | 566 | |
ALL ending balance collectively evaluated for impairment | 1,560 | 2,455 | |
Loans outstanding - September 30, 2019 | 302,538 | 297,576 | |
Loans ending balance individually evaluated for impairment | 1,878 | 5,667 | |
Loans ending balance collectively evaluated for impairment | 300,660 | 291,909 | |
Commercial Real Estate-Owner Occupied | |||
ALL - January 1, 2019 | 3,750 | 3,376 | |
Charge-offs | (4,994) | (2,374) | |
Recoveries | 356 | 158 | |
Provision | 5,475 | 2,590 | |
ALL - September 30, 2019 | 4,587 | 3,750 | 3,376 |
ALL ending balance individually evaluated for impairment | 80 | 353 | |
ALL ending balance collectively evaluated for impairment | 4,507 | 3,397 | |
Loans outstanding - September 30, 2019 | 459,782 | 416,097 | |
Loans ending balance individually evaluated for impairment | 960 | 7,796 | |
Loans ending balance collectively evaluated for impairment | 458,822 | 408,301 | |
Commercial Real Estate-Non-Owner Occupied | |||
ALL - January 1, 2019 | 2,100 | 1,987 | |
Charge-offs | (62) | 0 | |
Recoveries | 60 | 3 | |
Provision | (520) | 110 | |
ALL - September 30, 2019 | 1,578 | 2,100 | 1,987 |
ALL ending balance individually evaluated for impairment | 0 | 0 | |
ALL ending balance collectively evaluated for impairment | 1,578 | 2,100 | |
Loans outstanding - September 30, 2019 | 353,723 | 252,717 | |
Loans ending balance individually evaluated for impairment | 0 | 0 | |
Loans ending balance collectively evaluated for impairment | 353,723 | 252,717 | |
Residential 14 Family | |||
ALL - January 1, 2019 | 2,472 | 2,728 | |
Charge-offs | (276) | (140) | |
Recoveries | 130 | 233 | |
Provision | (157) | (349) | |
ALL - September 30, 2019 | 2,169 | 2,472 | 2,728 |
ALL ending balance individually evaluated for impairment | 0 | 160 | |
ALL ending balance collectively evaluated for impairment | 2,169 | 2,312 | |
Loans outstanding - September 30, 2019 | 448,605 | 368,673 | |
Loans ending balance individually evaluated for impairment | 0 | 702 | |
Loans ending balance collectively evaluated for impairment | 448,605 | 367,971 | |
Consumer | |||
ALL - January 1, 2019 | 148 | 191 | |
Charge-offs | (76) | (48) | |
Recoveries | 11 | 12 | |
Provision | 58 | (7) | |
ALL - September 30, 2019 | 141 | 148 | $ 191 |
ALL ending balance individually evaluated for impairment | 0 | 0 | |
ALL ending balance collectively evaluated for impairment | 141 | 148 | |
Loans outstanding - September 30, 2019 | 29,462 | 26,854 | |
Loans ending balance individually evaluated for impairment | 0 | 0 | |
Loans ending balance collectively evaluated for impairment | $ 29,462 | $ 26,854 |
Loans - Past Due Financial Rece
Loans - Past Due Financial Receivables (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | $ 8,449 | $ 20,941 |
Financing Receivable, Recorded Investment, Nonaccrual Status | 5,093 | 20,099 |
Other | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | 0 | 0 |
Financing Receivable, Recorded Investment, Nonaccrual Status | 0 | 0 |
Construction and Development | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | 779 | 0 |
Financing Receivable, Recorded Investment, Nonaccrual Status | 0 | 0 |
Commercial/Industrial | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | 2,158 | 8,077 |
Financing Receivable, Recorded Investment, Nonaccrual Status | 1,923 | 8,001 |
Commercial Real Estate-Owner Occupied | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | 3,637 | 10,370 |
Financing Receivable, Recorded Investment, Nonaccrual Status | 2,513 | 10,311 |
Commercial Real Estate-Non-Owner Occupied | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | 75 | 291 |
Financing Receivable, Recorded Investment, Nonaccrual Status | 75 | 233 |
Residential 14 Family | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | 1,662 | 2,186 |
Financing Receivable, Recorded Investment, Nonaccrual Status | 550 | 1,549 |
Consumer | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | 138 | 17 |
Financing Receivable, Recorded Investment, Nonaccrual Status | 32 | 5 |
30-89 Days Past Due Accruing | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | 3,002 | 419 |
30-89 Days Past Due Accruing | Other | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | 0 | 0 |
30-89 Days Past Due Accruing | Construction and Development | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | 768 | 0 |
30-89 Days Past Due Accruing | Commercial/Industrial | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | 235 | 76 |
30-89 Days Past Due Accruing | Commercial Real Estate-Owner Occupied | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | 1,124 | 59 |
30-89 Days Past Due Accruing | Commercial Real Estate-Non-Owner Occupied | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | 0 | 0 |
30-89 Days Past Due Accruing | Residential 14 Family | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | 805 | 275 |
30-89 Days Past Due Accruing | Consumer | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | 70 | 9 |
90 Days Past Due Accruing | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | 354 | 423 |
90 Days Past Due Accruing | Other | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | 0 | 0 |
90 Days Past Due Accruing | Construction and Development | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | 11 | 0 |
90 Days Past Due Accruing | Commercial/Industrial | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | 0 | 0 |
90 Days Past Due Accruing | Commercial Real Estate-Owner Occupied | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | 0 | 0 |
90 Days Past Due Accruing | Commercial Real Estate-Non-Owner Occupied | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | 0 | 58 |
90 Days Past Due Accruing | Residential 14 Family | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | 307 | 362 |
90 Days Past Due Accruing | Consumer | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, Past Due | $ 36 | $ 3 |
Loans - Accretable and non-accr
Loans - Accretable and non-accretable components (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Impaired Financing Receivable, Recorded Investment | $ 5,776 | $ 14,165 |
Impaired Financing Receivable, Unpaid Principal Balance | 5,776 | 14,165 |
Other | ||
Impaired Financing Receivable, Recorded Investment | 0 | 0 |
Impaired Financing Receivable, Unpaid Principal Balance | 0 | 0 |
Construction and Development | ||
Impaired Financing Receivable, Recorded Investment | 0 | 0 |
Impaired Financing Receivable, Unpaid Principal Balance | 0 | 0 |
Commercial/Industrial | ||
Impaired Financing Receivable, Recorded Investment | 1,878 | 5,667 |
Impaired Financing Receivable, Unpaid Principal Balance | 1,878 | 5,667 |
Commercial Real Estate-Owner Occupied | ||
Impaired Financing Receivable, Recorded Investment | 3,898 | 7,796 |
Impaired Financing Receivable, Unpaid Principal Balance | 3,898 | 7,796 |
Commercial Real Estate-Non-Owner Occupied | ||
Impaired Financing Receivable, Recorded Investment | 0 | 0 |
Impaired Financing Receivable, Unpaid Principal Balance | 0 | 0 |
Residential 14 Family | ||
Impaired Financing Receivable, Recorded Investment | 0 | 702 |
Impaired Financing Receivable, Unpaid Principal Balance | 0 | 702 |
Consumer | ||
Impaired Financing Receivable, Recorded Investment | 0 | 0 |
Impaired Financing Receivable, Unpaid Principal Balance | 0 | 0 |
Financial Asset Acquired with Credit Deterioration [Member] | ||
Impaired Financing Receivable, Recorded Investment | 1,823 | 4,181 |
Impaired Financing Receivable, Unpaid Principal Balance | 2,265 | 5,244 |
Financial Asset Acquired with Credit Deterioration [Member] | Other | ||
Impaired Financing Receivable, Recorded Investment | 0 | 0 |
Impaired Financing Receivable, Unpaid Principal Balance | 0 | 0 |
Financial Asset Acquired with Credit Deterioration [Member] | Construction and Development | ||
Impaired Financing Receivable, Recorded Investment | 213 | 171 |
Impaired Financing Receivable, Unpaid Principal Balance | 237 | 171 |
Financial Asset Acquired with Credit Deterioration [Member] | Commercial/Industrial | ||
Impaired Financing Receivable, Recorded Investment | 191 | 555 |
Impaired Financing Receivable, Unpaid Principal Balance | 212 | 701 |
Financial Asset Acquired with Credit Deterioration [Member] | Commercial Real Estate-Owner Occupied | ||
Impaired Financing Receivable, Recorded Investment | 518 | 1,558 |
Impaired Financing Receivable, Unpaid Principal Balance | 785 | 2,069 |
Financial Asset Acquired with Credit Deterioration [Member] | Commercial Real Estate-Non-Owner Occupied | ||
Impaired Financing Receivable, Recorded Investment | 0 | 233 |
Impaired Financing Receivable, Unpaid Principal Balance | 0 | 475 |
Financial Asset Acquired with Credit Deterioration [Member] | Residential 14 Family | ||
Impaired Financing Receivable, Recorded Investment | 901 | 1,664 |
Impaired Financing Receivable, Unpaid Principal Balance | 1,031 | 1,828 |
Financial Asset Acquired with Credit Deterioration [Member] | Consumer | ||
Impaired Financing Receivable, Recorded Investment | 0 | 0 |
Impaired Financing Receivable, Unpaid Principal Balance | $ 0 | $ 0 |
Loans- Financing Receivable Cre
Loans- Financing Receivable Credit Quality Indicators (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Loans and Leases Receivable, Gross | $ 1,736,846 | $ 1,429,213 |
Other | ||
Loans and Leases Receivable, Gross | 10,440 | 6,369 |
Construction and Development | ||
Loans and Leases Receivable, Gross | 132,296 | 60,927 |
Commercial/Industrial | ||
Loans and Leases Receivable, Gross | 302,538 | 297,576 |
Commercial Real Estate-Owner Occupied | ||
Loans and Leases Receivable, Gross | 459,782 | 416,097 |
Commercial Real Estate-Non-Owner Occupied | ||
Loans and Leases Receivable, Gross | 353,723 | 252,717 |
Residential 14 Family | ||
Loans and Leases Receivable, Gross | 448,605 | 368,673 |
Consumer | ||
Loans and Leases Receivable, Gross | 29,462 | 26,854 |
Pass (1-5) | ||
Loans and Leases Receivable, Gross | 1,676,560 | 1,361,591 |
Pass (1-5) | Other | ||
Loans and Leases Receivable, Gross | 10,440 | 6,369 |
Pass (1-5) | Construction and Development | ||
Loans and Leases Receivable, Gross | 132,266 | 60,866 |
Pass (1-5) | Commercial/Industrial | ||
Loans and Leases Receivable, Gross | 290,180 | 277,993 |
Pass (1-5) | Commercial Real Estate-Owner Occupied | ||
Loans and Leases Receivable, Gross | 422,336 | 375,614 |
Pass (1-5) | Commercial Real Estate-Non-Owner Occupied | ||
Loans and Leases Receivable, Gross | 344,278 | 249,625 |
Pass (1-5) | Residential 14 Family | ||
Loans and Leases Receivable, Gross | 447,630 | 364,289 |
Pass (1-5) | Consumer | ||
Loans and Leases Receivable, Gross | 29,430 | 26,835 |
Pass 6 | ||
Loans and Leases Receivable, Gross | 19,962 | 13,643 |
Pass 6 | Other | ||
Loans and Leases Receivable, Gross | 0 | 0 |
Pass 6 | Construction and Development | ||
Loans and Leases Receivable, Gross | 0 | 0 |
Pass 6 | Commercial/Industrial | ||
Loans and Leases Receivable, Gross | 5,329 | 7,309 |
Pass 6 | Commercial Real Estate-Owner Occupied | ||
Loans and Leases Receivable, Gross | 5,603 | 5,670 |
Pass 6 | Commercial Real Estate-Non-Owner Occupied | ||
Loans and Leases Receivable, Gross | 8,774 | 0 |
Pass 6 | Residential 14 Family | ||
Loans and Leases Receivable, Gross | 256 | 664 |
Pass 6 | Consumer | ||
Loans and Leases Receivable, Gross | 0 | 0 |
Pass 7 | ||
Loans and Leases Receivable, Gross | 40,324 | 53,952 |
Pass 7 | Other | ||
Loans and Leases Receivable, Gross | 0 | 0 |
Pass 7 | Construction and Development | ||
Loans and Leases Receivable, Gross | 30 | 61 |
Pass 7 | Commercial/Industrial | ||
Loans and Leases Receivable, Gross | 7,029 | 12,274 |
Pass 7 | Commercial Real Estate-Owner Occupied | ||
Loans and Leases Receivable, Gross | 31,843 | 34,789 |
Pass 7 | Commercial Real Estate-Non-Owner Occupied | ||
Loans and Leases Receivable, Gross | 671 | 3,092 |
Pass 7 | Residential 14 Family | ||
Loans and Leases Receivable, Gross | 719 | 3,718 |
Pass 7 | Consumer | ||
Loans and Leases Receivable, Gross | 32 | 18 |
Pass 8 | ||
Loans and Leases Receivable, Gross | 0 | 27 |
Pass 8 | Other | ||
Loans and Leases Receivable, Gross | 0 | 0 |
Pass 8 | Construction and Development | ||
Loans and Leases Receivable, Gross | 0 | 0 |
Pass 8 | Commercial/Industrial | ||
Loans and Leases Receivable, Gross | 0 | 0 |
Pass 8 | Commercial Real Estate-Owner Occupied | ||
Loans and Leases Receivable, Gross | 0 | 24 |
Pass 8 | Commercial Real Estate-Non-Owner Occupied | ||
Loans and Leases Receivable, Gross | 0 | 0 |
Pass 8 | Residential 14 Family | ||
Loans and Leases Receivable, Gross | 0 | 2 |
Pass 8 | Consumer | ||
Loans and Leases Receivable, Gross | $ 0 | $ 1 |
Loans - Impaired loans of Recor
Loans - Impaired loans of Recorded investment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
With an allowance recorded: | ||
Recorded investment | $ 2,838 | $ 8,289 |
Unpaid principal balance | 2,838 | 8,289 |
Related allowance | 840 | 1,079 |
With no related allowance recorded: | ||
Recorded investment | 2,938 | 5,876 |
Unpaid principal balance | 2,938 | 5,876 |
Total: | ||
Recorded investment | 5,776 | 14,165 |
Unpaid principal balance | 5,776 | 14,165 |
Related allowance | 840 | 1,079 |
Average recorded investment | 9,971 | 7,576 |
Other | ||
With an allowance recorded: | ||
Recorded investment | 0 | 0 |
Unpaid principal balance | 0 | 0 |
Related allowance | 0 | 0 |
With no related allowance recorded: | ||
Recorded investment | 0 | 0 |
Unpaid principal balance | 0 | 0 |
Total: | ||
Recorded investment | 0 | 0 |
Unpaid principal balance | 0 | 0 |
Related allowance | 0 | 0 |
Average recorded investment | 0 | 0 |
Construction and Development | ||
With an allowance recorded: | ||
Recorded investment | 0 | 0 |
Unpaid principal balance | 0 | 0 |
Related allowance | 0 | 0 |
With no related allowance recorded: | ||
Recorded investment | 0 | 0 |
Unpaid principal balance | 0 | 0 |
Total: | ||
Recorded investment | 0 | 0 |
Unpaid principal balance | 0 | 0 |
Related allowance | 0 | 0 |
Average recorded investment | 0 | 0 |
Commercial/Industrial | ||
With an allowance recorded: | ||
Recorded investment | 1,878 | 5,667 |
Unpaid principal balance | 1,878 | 5,667 |
Related allowance | 760 | 566 |
With no related allowance recorded: | ||
Recorded investment | 0 | 0 |
Unpaid principal balance | 0 | 0 |
Total: | ||
Recorded investment | 1,878 | 5,667 |
Unpaid principal balance | 1,878 | 5,667 |
Related allowance | 760 | 566 |
Average recorded investment | 3,773 | 2,834 |
Commercial Real Estate-Owner Occupied | ||
With an allowance recorded: | ||
Recorded investment | 960 | 2,099 |
Unpaid principal balance | 960 | 2,099 |
Related allowance | 80 | 353 |
With no related allowance recorded: | ||
Recorded investment | 2,938 | 5,697 |
Unpaid principal balance | 2,938 | 5,697 |
Total: | ||
Recorded investment | 3,898 | 7,796 |
Unpaid principal balance | 3,898 | 7,796 |
Related allowance | 80 | 353 |
Average recorded investment | 5,847 | 4,036 |
Commercial Real Estate-Non-Owner Occupied | ||
With an allowance recorded: | ||
Recorded investment | 0 | 0 |
Unpaid principal balance | 0 | 0 |
Related allowance | 0 | 0 |
With no related allowance recorded: | ||
Recorded investment | 0 | 0 |
Unpaid principal balance | 0 | 0 |
Total: | ||
Recorded investment | 0 | 0 |
Unpaid principal balance | 0 | 0 |
Related allowance | 0 | 0 |
Average recorded investment | 0 | 0 |
Residential 14 Family | ||
With an allowance recorded: | ||
Recorded investment | 0 | 523 |
Unpaid principal balance | 0 | 523 |
Related allowance | 0 | 160 |
With no related allowance recorded: | ||
Recorded investment | 0 | 179 |
Unpaid principal balance | 0 | 179 |
Total: | ||
Recorded investment | 0 | 702 |
Unpaid principal balance | 0 | 702 |
Related allowance | 0 | 160 |
Average recorded investment | 351 | 706 |
Consumer | ||
With an allowance recorded: | ||
Recorded investment | 0 | 0 |
Unpaid principal balance | 0 | 0 |
Related allowance | 0 | 0 |
With no related allowance recorded: | ||
Recorded investment | 0 | 0 |
Unpaid principal balance | 0 | 0 |
Total: | ||
Recorded investment | 0 | 0 |
Unpaid principal balance | 0 | 0 |
Related allowance | 0 | 0 |
Average recorded investment | $ 0 | $ 0 |
Loans - Credit Deterioration (D
Loans - Credit Deterioration (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Interest income in accordance with orignial terms | $ 651 | $ 1,020 | $ 113 |
Interest income recognized | (129) | (416) | (109) |
Reduction in interest income | 522 | 604 | 4 |
Accretable Discount [Member] | |||
Balance at beginning of period | 318 | 583 | |
Acquired balance, net | 44 | 0 | |
Reclassifications between accretable and non-accretable | 858 | 55 | |
Accretion to loan interest income | (998) | (320) | |
Disposals of loans | 0 | 0 | |
Balance at end of period | 222 | 318 | 583 |
Non Accretable Discount [Member] | |||
Balance at beginning of period | 745 | 800 | |
Acquired balance, net | 333 | 0 | |
Reclassifications between accretable and non-accretable | (858) | (55) | |
Accretion to loan interest income | 0 | 0 | |
Disposals of loans | 0 | 0 | |
Balance at end of period | $ 220 | $ 745 | $ 800 |
Loans - Schedule of troubled de
Loans - Schedule of troubled debt restructurings (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019USD ($)contract | Dec. 31, 2018USD ($)contract | |
Pre-Modification Outstanding Recorded Investment | $ 546 | |
Post-Modification Outstanding Recorded Investment | $ 370 | |
Commercial/Industrial | ||
Number of Contracts | contract | 1 | |
Pre-Modification Outstanding Recorded Investment | $ 113 | |
Post-Modification Outstanding Recorded Investment | $ 113 | |
Commercial Real Estate | ||
Number of Contracts | contract | 1 | 2 |
Pre-Modification Outstanding Recorded Investment | $ 61 | $ 5,396 |
Post-Modification Outstanding Recorded Investment | $ 61 | $ 5,044 |
Residential 14 Family | ||
Number of Contracts | contract | 2 | |
Pre-Modification Outstanding Recorded Investment | $ 372 | |
Post-Modification Outstanding Recorded Investment | $ 196 |
Loans (Details Textual)
Loans (Details Textual) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Loans | |||
Loans and Leases Receivable, Allowance | $ 11,396,000 | $ 12,248,000 | $ 11,612,000 |
Troubled Debt Restructuring Reserve | $ 353,000,000 | $ 0 |
Related Party Matters (Details)
Related Party Matters (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Related Party Matters | ||
Balances at beginning | $ 84,103 | $ 65,749 |
New loans and advances | 27,886 | 59,684 |
Repayments | (43,435) | (41,330) |
Balance at end | $ 68,554 | $ 84,103 |
Related Party Matters - Additio
Related Party Matters - Additional Information (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Related Party Matters | ||
Related Party Deposit Liabilities | $ 25,527,000 | $ 14,127,000 |
Mortgage Servicing Rights (Deta
Mortgage Servicing Rights (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Fair value at beginning of year | $ 3,085,000 | $ 2,610,000 |
MSR asset acquired | 1,859,000 | |
Servicing asset additions | 740,000 | 356,000 |
Loan payments and payoffs | (821,000) | (475,000) |
Changes in valuation inputs and assumptions used in the valuation model | (576,000) | 594,000 |
Amount recognized through earnings | (592,000) | 475,000 |
Fair value at end of period | 4,287,000 | 3,085,000 |
Unpaid principal balance of loans serviced for others | 5,776,000 | 14,165,000 |
Other | ||
Unpaid principal balance of loans serviced for others | $ 0 | $ 0 |
Mortgage servicing rights as a percent of loans serviced for others | 0.77% | 0.97% |
Other | Mortgage Servicing Rights [Member] | ||
Unpaid principal balance of loans serviced for others | $ 554,374,000 | $ 316,480,000 |
Mortgage Servicing Rights - Add
Mortgage Servicing Rights - Additional Information (Details) - M | Dec. 31, 2019 | Dec. 31, 2018 |
Measurement Input, Discount Rate [Member] | ||
Mortgage Servicing Rights Discount Rate | 10.00% | |
Measurement Input, Prepayment Rate [Member] | ||
Servicing Asset, Measurement Input | 12.1 | 8.3 |
Premises and Equipment (Details
Premises and Equipment (Details) - USD ($) | Dec. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment, Gross | $ 41,698,000 | $ 32,948,000 | |
Less accumulated depreciation | 8,111,000 | 8,459,000 | |
Right-of-use lease asset | 1,744,000 | ||
Property, Plant and Equipment, Net, Total | 35,286,000 | 24,489,000 | |
Accounting Standards Update 2016-02 [Member] | |||
Right-of-use lease asset | 1,699,000 | $ 1,699,000 | |
Land and Land Improvements [Member] | |||
Property, Plant and Equipment, Gross | 4,584,000 | 3,363,000 | |
Building and Building Improvements [Member] | |||
Property, Plant and Equipment, Gross | 31,754,000 | 23,408,000 | |
Furniture and Fixtures [Member] | |||
Property, Plant and Equipment, Gross | $ 5,360,000 | $ 6,177,000 |
Premises and Equipment - Additi
Premises and Equipment - Additional Information (Details ) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Buildings and Improvements, Gross | $ 6,169,000 | $ 764,000 | |
Premises And Equipment [Member] | |||
Depreciation, Depletion and Amortization | $ 1,272,000 | $ 1,116,000 | $ 1,126,000 |
Other Real Estate Owned (Detail
Other Real Estate Owned (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Other Real Estate Owned | ||
Other Real Estate, Beginning Balance | $ 3,592 | $ 6,270 |
Transfers in | 4,927 | 1,310 |
Gain (loss) on sale of OREO and valuation allowance | 73 | (252) |
Sales | (1,704) | (3,736) |
Other Real Estate, Ending Balance | $ 6,888 | $ 3,592 |
Other Real Estate Owned - Addit
Other Real Estate Owned - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Other Real Estate Owned | |||
Beginning of year | $ 2,208 | $ 2,078 | $ 2,094 |
Additions charged to expense | 13 | 130 | |
Valuation relieved due to sale of OREO | (100) | 0 | (16) |
End of year | 2,121 | $ 2,208 | $ 2,078 |
Mortgage loans in process of foreclosure amount | $ 408,000 |
Investment in Minority-owned _2
Investment in Minority-owned Subsidiaries (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Assets | $ 2,210,168,000 | $ 1,793,165,000 | |
Liabilities | 1,979,957,000 | 1,618,842,000 | |
Information Technology and Data Processing | 4,509,000 | 3,619,000 | $ 2,939,000 |
Long-term Debt | $ 39,800,000 | 0 | |
UFSLLC [Member] | Investments In Minority owned Subsidiaries [Member] | |||
Equity Method Investment, Ownership Percentage | 49.80% | ||
Assets | $ 25,489,000,000 | 22,140,000,000 | |
Liabilities | 3,661,000,000 | 1,905,000,000 | |
Equity Method Investment, Aggregate Cost | 10,732,000,000 | 10,005,000,000 | |
Retained Earnings, Undistributed Earnings from Equity Method Investees | 2,935,000,000 | 2,563,000,000 | 2,390,000,000 |
Information Technology and Data Processing | 3,248,000,000 | 2,514,000,000 | 2,069,000,000 |
Deferred Tax Assets, Net | 1,124,000,000 | 939,000,000 | |
Proceeds from Dividends Received | 2,108,000,000 | 1,505,000,000 | 915,000,000 |
Ansay Associates LLC [Member] | Board of Directors Chairman [Member] | |||
Payments For officer fidelity bond and commercial insurance coverage | $ 225,000,000 | 165,000,000 | 164,000,000 |
Ansay Associates LLC [Member] | Investments In Minority owned Subsidiaries [Member] | |||
Equity Method Investment, Ownership Percentage | 40.00% | ||
Assets | $ 79,781,000,000 | 63,951,000,000 | |
Liabilities | 42,838,000,000 | 45,289,000,000 | |
Equity Method Investment, Aggregate Cost | 29,555,000 | 15,392,000,000 | |
Retained Earnings, Undistributed Earnings from Equity Method Investees | 1,792,000,000 | 2,114,000,000 | 1,663,000,000 |
Information Technology and Data Processing | 1,329,000,000 | 1,432,000,000 | $ 964,000,000 |
Deferred Tax Assets, Net | 1,385,000,000 | 1,299,000,000 | |
Long-term Debt | 19,124,000,000 | 21,799,000,000 | |
Line of Credit Facility, Remaining Borrowing Capacity | 1,000,000,000,000 | ||
Deposit Assets | $ 17,495,000,000 | $ 6,009,000,000 |
Identifiable Intangible Asset_2
Identifiable Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Gross Carrying Amount | $ 11,620 | $ 6,182 |
Intangible Accumulated Amortization | 1,954 | 885 |
Core Deposits | ||
Gross Carrying Amount | 7,333 | 3,097 |
Intangible Accumulated Amortization | 1,954 | 885 |
Mortgage servicing rights | ||
Gross Carrying Amount | 4,287 | 3,085 |
Intangible Accumulated Amortization | $ 0 | $ 0 |
Identifiable Intangible Asset_3
Identifiable Intangible Assets - Projections of amortization expense (Details) - Core Deposits $ in Thousands | Dec. 31, 2019USD ($) |
2020 | $ 1,335 |
2021 | 1,130 |
2022 | 925 |
2023 | 720 |
2024 | 516 |
Thereafter | 753 |
Total | $ 5,379 |
Identifiable Intangible Asset_4
Identifiable Intangible Assets - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Identifiable Intangible Assets | |||
Amortization of Intangible Assets | $ 1,069 | $ 756 | $ 132 |
Goodwill (Details)
Goodwill (Details) - USD ($) | Dec. 31, 2019 | Jul. 12, 2019 | Dec. 31, 2018 | Oct. 27, 2017 |
Goodwill | $ 43,456,000 | $ 28,432,000 | $ 15,024,000 | $ 7,101,000 |
Waupaca Bancorporation Inc [Member] | ||||
Goodwill | $ 28,432,000 |
Deposits (Details)
Deposits (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Deposits | ||
Noninterest-bearing demand deposits | $ 476,465 | $ 448,765 |
Interest-bearing demand deposits | 184,843 | 92,107 |
Savings deposits | 792,997 | 616,138 |
Time deposits | 373,430 | 382,450 |
Brokered CD's | 15,576 | 17,707 |
Total deposits | $ 1,843,311 | $ 1,557,167 |
Deposits - Maturities of time d
Deposits - Maturities of time deposits (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Deposits | |
2020 | $ 214,360 |
2021 | 113,074 |
2022 | 25,955 |
2023 | 25,161 |
2024 | 7,858 |
Thereafter | 2,598 |
Total | $ 389,006 |
Deposits - Additional Informati
Deposits - Additional Information (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Deposits | ||
Time Deposits 250000 or More | $ 55,948,000 | $ 81,663,000 |
Securities Sold Under Repurch_3
Securities Sold Under Repurchase Agreements (Details) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | |
Outstanding balance at the end of the year | $ 45,865 | $ 31,489 | ||
Securities Sold under Agreements to Repurchase [Member] | ||||
Outstanding balance at the end of the year | $ 45,865 | $ 31,489 | $ 47,568 | |
Weighted average interest rate at the end of the year | 1.47% | 2.43% | 1.44% | |
Average balance during the year | $ 21,522 | $ 22,315 | $ 26,537 | |
Average interest rate during the year | 2.14 | 1.79 | 1.01 | |
Maximum month end balance during the year | $ 45,865 | $ 48,010 | $ 53,745 |
Notes Payable (Details)
Notes Payable (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Long-term Debt | $ 39,800 | $ 0 |
Maturity of Fixed Term one Member | ||
Long-term Debt | $ 1,000 | |
Debt Instrument, Basis Spread on Variable Rate | 1.42% | |
Maturity of Fixed Term Two Member | ||
Long-term Debt | $ 400 | |
Debt Instrument, Basis Spread on Variable Rate | 1.28% | |
Maturity of Fixed Term Three Member | ||
Long-term Debt | $ 2,000 | |
Debt Instrument, Basis Spread on Variable Rate | 1.67% | |
Maturity of Fixed Term Four Member | ||
Long-term Debt | $ 5,000 | |
Debt Instrument, Basis Spread on Variable Rate | 2.37% | |
Maturity of Fixed Term Five Member | ||
Long-term Debt | $ 1,000 | |
Debt Instrument, Basis Spread on Variable Rate | 1.60% | |
Maturity of Fixed Term Six Member | ||
Long-term Debt | $ 400 | |
Debt Instrument, Basis Spread on Variable Rate | 1.46% | |
Maturity of Fixed Term Seven Member | ||
Long-term Debt | $ 10,000 | |
Debt Instrument, Basis Spread on Variable Rate | 1.76% | |
Maturity of Fixed Term Eight Member | ||
Long-term Debt | $ 10,000 | |
Debt Instrument, Basis Spread on Variable Rate | 1.74% | |
Maturity of Fixed Term Nine Member | ||
Long-term Debt | $ 10,000 | |
Debt Instrument, Basis Spread on Variable Rate | 1.75% | |
Commercial Bank One [Member] | ||
Debt Instrument, Basis Spread on Variable Rate | 3.50% | |
Commercial Bank Two [Member] | ||
Debt Instrument, Basis Spread on Variable Rate | 3.25% |
Notes Payable - Future maturiti
Notes Payable - Future maturities of borrowings (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Notes Payable [Abstract] | ||
2020 | $ 1,400 | |
2021 | 8,400 | |
2022 | 10,000 | |
2023 | 10,000 | |
2024 | 10,000 | |
Long-term Debt | $ 39,800 | $ 0 |
Notes Payable (Details Textual)
Notes Payable (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Long-term Debt | $ 39,800,000 | $ 0 |
Short-term borrowings mature within twelve months | 1,400,000,000 | |
Long-term amount, remaining | 38,400,000,000 | |
Long-term Debt, Maturities, Repayments of Principal in Next Rolling Twelve Months | 1,400,000 | |
Federal Home Loan Bank, Advances, General Debt Obligations, Maximum Amount Available | 815,200,000 | 697,300,000 |
Federal Home Loan Bank, Advances, General Debt Obligations, Disclosures, Collateral Pledged | 373,100,000 | 316,200,000 |
Federal Home Loan Bank Stock | 2,230,000 | 1,700,000 |
Federal Home Loan Bank Advances | 14,400,000 | 55,000,000 |
Federal Home Loan Bank, Advances, General Debt Obligations, Amount of Available, Unused Funds | 318,900,000 | 261,200,000 |
Commercial Bank One [Member] | ||
Line of Credit Facility, Maximum Borrowing Capacity | 5,000,000 | |
Long-term Line of Credit | $ 0 | $ 5,000,000 |
Debt Instrument, Basis Spread on Variable Rate | 3.50% | |
Commercial Bank Two [Member] | ||
Line of Credit Facility, Maximum Borrowing Capacity | $ 5,000,000 | |
Debt Instrument, Basis Spread on Variable Rate | 3.25% |
Subordinated Debt (Details)
Subordinated Debt (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Subordinated Borrowing [Line Items] | ||
Subordinated Debt | $ 18,622,000 | $ 11,500,000 |
Subordinated Debt [Member] | ||
Subordinated Borrowing [Line Items] | ||
Debt Instrument, Term | 10 years | |
Line of Credit Facility, Maximum Borrowing Capacity | $ 22,500,000 | |
Long-term Debt, Gross | 7,000,000 | |
Liabilities, Fair Value Adjustment | $ 195,000 | |
Debt Instrument, Interest Rate During Period | 7.10% |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Current tax expense: | |||||||||||
Federal | $ 4,327,000 | $ 3,349,000 | $ 6,340,000 | ||||||||
State | 2,412,000 | 2,100,000 | 1,862,000 | ||||||||
Total current | 6,739,000 | 5,449,000 | 8,202,000 | ||||||||
Deferred tax expenses (benefit): | |||||||||||
Impact of change in tax rate from tax legislation | 0 | 0 | 642,000 | ||||||||
Federal | 620,000 | 815,000 | (12,000) | ||||||||
State | 236,000 | 333,000 | (6,000) | ||||||||
Total deferred | 856,000 | 1,148,000 | 624,000 | ||||||||
Income Tax Expense (Benefit), Total | $ 2,225,000 | $ 1,712,000 | $ 1,666,000 | $ 1,992,000 | $ 1,362,000 | $ 1,604,000 | $ 1,431,000 | $ 2,200,000 | $ 7,595,000 | $ 6,597,000 | $ 8,826,000 |
Income Taxes - Federal statutor
Income Taxes - Federal statutory rate and the provision for income taxes (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Taxes | |||||||||||
Tax expense at statutory rate | $ 7,201,000 | $ 6,731,000 | $ 8,449,000 | ||||||||
Increase (decrease) in taxes resulting from: | |||||||||||
Tax-exempt interest | (1,320,000) | (1,105,000) | (1,279,000) | ||||||||
State taxes (net of Federal benefit) | 1,923,000 | 1,674,000 | 1,210,000 | ||||||||
Cash surrender value of life insurance | (131,000) | (128,000) | (192,000) | ||||||||
ESOP dividend | (93,000) | (81,000) | (121,000) | ||||||||
Tax credits | (39,000) | (91,000) | (117,000) | ||||||||
Nondeductible expenses associated with acquisition | 0 | 0 | 160,000 | ||||||||
Deferred tax rate differential from tax legislation | 0 | 0 | 642,000 | ||||||||
Other | 54,000 | (403,000) | 74,000 | ||||||||
Income Tax Expense (Benefit), Total | $ 2,225,000 | $ 1,712,000 | $ 1,666,000 | $ 1,992,000 | $ 1,362,000 | $ 1,604,000 | $ 1,431,000 | $ 2,200,000 | $ 7,595,000 | $ 6,597,000 | $ 8,826,000 |
Income Taxes - Deferred tax (De
Income Taxes - Deferred tax (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred tax assets: | ||
Deferred compensation | $ 1,036 | $ 1,089 |
Premises and equipment | 398 | 214 |
Accrued vacation and severance | 35 | 36 |
Accrued vacation and severance | 3,104 | 3,336 |
Other real estate owned | 360 | 352 |
Unrealized loss on securities available for sale | 0 | 97 |
Other | 244 | 95 |
Total deferred tax assets | 5,177 | 5,219 |
Deferred tax liabilities: | ||
Investment in acquisition and discount accretion | (148) | (162) |
Mortgage servicing rights | (1,168) | (840) |
Premises and equipment | (248) | (209) |
Unrealized gain on securities available for sale | (63) | (66) |
Other investments | (2,509) | (2,238) |
Prepaid expenses | (1,000) | (1,049) |
Investment in minority owned subsidiaries | (339) | |
Goodwill and other intangibles | (743) | |
Total deferred tax liabilities | (6,218) | (4,564) |
Net deferred tax liability | $ (1,041) | |
Net deferred tax asset | $ 655 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Taxes | |||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | 35.00% | |
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Amount | $ 0 | $ 0 | $ 642,000 |
Income Tax Examination, Likelihood of Unfavorable Settlement | For tax positions meeting the more likely than not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the relevant tax authority. When applicable, interest and penalties on uncertain tax positions are calculated based on the guidance from the relevant tax authority and included in income tax expense. |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - Restricted Stock Units (RSUs) [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Restricted Stock, Shares Outstanding at beginning of period | 51,776 | 53,619 |
Restricted Stock, Shares Granted | 17,015 | 17,982 |
Restricted Stock, Shares Vested | (17,212) | (19,825) |
Restricted Stock, Shares Forfeited or cancelled | (903) | 0 |
Restricted Stock, Shares Outstanding at end of period | 50,676 | 51,776 |
Weighted-Average Grant-Date Fair Value, Outstanding at beginning of period | $ 34.27 | $ 26.59 |
Weighted-Average Grant-Date Fair Value, Granted | 56.62 | 46.55 |
Weighted-Average Grant-Date Fair Value, Vested | 30.54 | 24.36 |
Weighted-Average Grant-Date Fair Value, Forfeited or cancelled | 41.01 | 0 |
Weighted-Average Grant-Date Fair Value, Outstanding at end of period | $ 43.03 | $ 34.27 |
Employee Benefit Plans - Additi
Employee Benefit Plans - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Employee Stock Ownership Plan (ESOP), Plan Description | The Corporation has a defined contribution profit sharing 401(k) plan which includes the provisions for an employee stock ownership plan ("ESOP"). The plan is available to all employees over 18 years of age after completion of three months of service. Employees participating in the plan may elect to defer a minimum of 2% of compensation up to the limits specified by law. | ||
Employee Stock Ownership Plan (ESOP), Shares in ESOP | 432,795 | 502,963 | |
Defined Contribution Plan, Employer Matching Contribution, Percent of Employees' Gross Pay | 35.00% | ||
Defined Contribution Plan, Maximum Annual Contributions Per Employee, Percent | 10.00% | 10.00% | |
Defined Contribution Plan Employer Additional Discretionary Contribution Amount | $ 505,000 | $ 656,000 | $ 532,000 |
Deferred Compensation Arrangement with Individual, Compensation Expense | 23,000 | 28,000 | |
Employee Stock Ownership Plan (ESOP), Compensation Expense | $ 957,000 | 1,061,000 | 842,000 |
2011 Equity Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 659,250 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 177,462 | ||
Employee Benefits and Share-based Compensation | $ 685,000 | 556,000 | 465,000 |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Share-based Awards Other than Options | $ 1,548,000 | ||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 2 years 7 months 24 days | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value | $ 526,000 | ||
Salary Continuation Plan [Member] | |||
Deferred Compensation Arrangement with Individual, Recorded Liability | $ 437,000 | $ 521,000 | |
Deferred Compensation Arrangement with Individual, Compensation Expense | $ 31,000 | ||
Defined Benefit Plan, Assumptions Used Calculating Benefit Obligation, Discount Rate | 4.95% | 4.95% | |
Deferrred Compensation Plan Estimated Annual Cash Benefit Payment | $ 108,011 | ||
Deferred Compensation Arrangement with Individual, Requisite Service Period | 15 years | ||
Nonqualified Deferred Compensation Plan [Member] | |||
Deferred Compensation Arrangement with Individual, Recorded Liability | $ 3,368,000 | $ 3,477,000 |
Stockholders' Equity and Regu_3
Stockholders' Equity and Regulatory Matters (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Total capital (to risk-weighted assets): | ||
Capital | $ 215,347 | $ 178,668 |
Capital to Risk Weighted Assets | 10.69% | 11.21% |
Capital Required for Capital Adequacy | $ 161,163 | $ 127,497 |
Capital Required for Capital Adequacy to Risk Weighted Assets | 8.00% | 8.00% |
Excess Capital | $ 211,527 | $ 157,459 |
Excess Capital to Risk Weighted Assets | 10.50% | 9.88% |
Capital Required to be Well Capitalized | $ 201,454 | $ 159,372 |
Capital Required to be Well Capitalized to Risk Weighted Assets | 10.00% | 10.00% |
Tier One Risk Based Capital [Abstract] | ||
Tier One Risk Based Capital | $ 203,951 | $ 166,420 |
Tier One Risk Based Capital to Risk Weighted Assets | 10.12% | 10.44% |
Tier One Risk Based Capital Required for Capital Adequacy | $ 120,872 | $ 95,623 |
Tier One Risk Based Capital Required for Capital Adequacy to Risk Weighted Assets | 6.00% | 6.00% |
Excess Tier One Risk Based Capital | $ 171,236 | $ 125,585 |
Excess Tier One Risk Based Capital to Risk Weighted Assets | 8.50% | 7.88% |
Tier One Risk Based Capital Required to be Well Capitalized | $ 161,163 | $ 127,497 |
Tier One Risk Based Capital Required to be Well Capitalized to Risk Weighted Assets | 8.00% | 8.00% |
Common Equity Tier One Capital [Abstract] | ||
Common Equity Tier One Capital | $ 203,951 | $ 166,420 |
Common Equity Tier One Capital Ratio | 10.12% | 10.44% |
Common Equity Tier One Capital Required for Capital Adequacy | $ 90,654 | $ 71,717 |
Common Equity Tier One Capital Required for Capital Adequacy To Risk Weighted Assets | 4.50% | 4.50% |
Excess Common Equity Tier One Capital | $ 141,018 | $ 101,679 |
Excess Common Equity Tier One Capital to Risk Weighted Assets | 7.00% | 6.38% |
Common Equity Tier One Capital Required to be Well-Capitalized | $ 130,945 | $ 103,592 |
Common Equity Tier One Capital Required To Be Well Capitalized To Risk Weighted Assets | 6.50% | 6.50% |
Tier One Leverage Capital [Abstract] | ||
Tier One Leverage Capital | $ 203,951 | $ 166,420 |
Tier One Leverage Capital to Average Assets | 9.67% | 9.59% |
Tier One Leverage Capital Required for Capital Adequacy | $ 84,390 | $ 69,410 |
Tier One Leverage Capital Required for Capital Adequacy to Average Assets | 4.00% | 4.00% |
Tier One Leverage Capital Required for Minimum Capital Adequacy with Capital Buffer | $ 105,487 | $ 86,762 |
Tier One Leverage Capital Required for Minimum Capital Adequacy with Capital Buffer to Average Assests | 5.00% | 5.00% |
Corporation [Member] | ||
Total capital (to risk-weighted assets): | ||
Capital | $ 208,900 | $ 181,201 |
Capital to Risk Weighted Assets | 10.35% | 11.35% |
Tier One Risk Based Capital [Abstract] | ||
Tier One Risk Based Capital | $ 178,882 | $ 157,453 |
Tier One Risk Based Capital to Risk Weighted Assets | 8.86% | 9.86% |
Common Equity Tier One Capital [Abstract] | ||
Common Equity Tier One Capital | $ 178,882 | $ 157,453 |
Common Equity Tier One Capital Ratio | 8.86% | 9.86% |
Tier One Leverage Capital [Abstract] | ||
Tier One Leverage Capital | $ 178,882 | $ 157,453 |
Tier One Leverage Capital to Average Assets | 8.46% | 9.06% |
Stockholders' Equity and Regu_4
Stockholders' Equity and Regulatory Matters - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Stockholders' Equity and Regulatory Matters | |
Dividends | $ 28,100,000 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Commitments and Contingencies | ||
Fixed | $ 49,741 | $ 57,911 |
Variable | 333,468 | 268,541 |
Credit card arrangements | 11,148 | 7,119 |
Letters of credit | $ 17,121 | $ 25,261 |
Commitments and Contingencies_3
Commitments and Contingencies (Details Textual) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Letters of Credit Outstanding, Amount | $ 17,121 | $ 25,261 |
Standby Letters of Credit [Member] | ||
Letters of Credit Outstanding, Amount | 5,629,000 | |
Letter of Credit [Member] | ||
Letters of Credit Outstanding, Amount | 11,492,000 | |
Interest Rate Lock Commitments [Member] | ||
Derivative, Notional Amount | $ 14,793,000 | $ 3,314,000 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Securities available for sale | |||
Mortgage servicing rights | $ 4,287 | $ 3,085 | $ 2,610 |
Corporate notes [Member] | |||
Securities available for sale | |||
Investments, Fair Value Disclosure | 51,720 | 16,444 | |
Mortgage servicing rights | 62,955 | ||
Obligations of states and political subdivisions [Member] | |||
Securities available for sale | |||
Investments, Fair Value Disclosure | 54,771 | 51,893 | |
Mortgage-backed securities [Member] | |||
Securities available for sale | |||
Investments, Fair Value Disclosure | 50,569 | ||
Quoted Prices In Active Markets for Identical Assets (Level 1) | |||
Securities available for sale | |||
Mortgage servicing rights | 0 | 0 | |
Quoted Prices In Active Markets for Identical Assets (Level 1) | Corporate notes [Member] | |||
Securities available for sale | |||
Investments, Fair Value Disclosure | 0 | 0 | |
Mortgage servicing rights | 0 | ||
Quoted Prices In Active Markets for Identical Assets (Level 1) | Obligations of states and political subdivisions [Member] | |||
Securities available for sale | |||
Investments, Fair Value Disclosure | 0 | 0 | |
Quoted Prices In Active Markets for Identical Assets (Level 1) | Mortgage-backed securities [Member] | |||
Securities available for sale | |||
Investments, Fair Value Disclosure | 0 | ||
Significant Other Other Inputs (Level 2) | |||
Securities available for sale | |||
Mortgage servicing rights | 4,287 | 3,085 | |
Significant Other Other Inputs (Level 2) | Corporate notes [Member] | |||
Securities available for sale | |||
Investments, Fair Value Disclosure | 51,720 | 16,444 | |
Mortgage servicing rights | 62,955 | ||
Significant Other Other Inputs (Level 2) | Obligations of states and political subdivisions [Member] | |||
Securities available for sale | |||
Investments, Fair Value Disclosure | 54,771 | 51,493 | |
Significant Other Other Inputs (Level 2) | Mortgage-backed securities [Member] | |||
Securities available for sale | |||
Investments, Fair Value Disclosure | 50,569 | ||
Significant Unobservable Inputs (Level 3) | |||
Securities available for sale | |||
Mortgage servicing rights | 0 | 0 | |
Significant Unobservable Inputs (Level 3) | Corporate notes [Member] | |||
Securities available for sale | |||
Investments, Fair Value Disclosure | 0 | 0 | |
Mortgage servicing rights | 0 | ||
Significant Unobservable Inputs (Level 3) | Obligations of states and political subdivisions [Member] | |||
Securities available for sale | |||
Investments, Fair Value Disclosure | $ 0 | 400 | |
Significant Unobservable Inputs (Level 3) | Mortgage-backed securities [Member] | |||
Securities available for sale | |||
Investments, Fair Value Disclosure | $ 0 |
Leases (Details)
Leases (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Leases | |
Amortization of ROU Assets - Finance Leases | $ 45 |
Interest on Lease Liabilities - Finance Leases | 87 |
Operating Lease Cost (Cost resulting from lease payments) | 132 |
New ROU Assets - Operating Leases | $ 1,744 |
Weighted Average Lease Term (Years) - Operating Leases | 31 years 6 months 22 days |
Weighted Average Discount Rate - Operating Leases | 5.50% |
Leases - Operating Lease (Detai
Leases - Operating Lease (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Operating lease payments due: | |
Within one year | $ 133 |
After one but within two years | 140 |
After two but within three years | 113 |
After three but within four years | 86 |
After four years but within five years | 86 |
After five years | 3,411 |
Total undiscounted cash flows | 3,969 |
Discount on cash flows | $ (2,270) |
Total operating lease liabilities | us-gaap:OperatingLeaseLiability |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) | Dec. 31, 2019 | Jan. 01, 2019 |
Operating Lease, Right-of-Use Asset | $ 1,744,000 | |
Operating Lease, Liability | us-gaap:OperatingLeaseLiability | |
Accounting Standards Update 2016-02 [Member] | ||
Operating Lease, Right-of-Use Asset | $ 1,699,000 | $ 1,699,000 |
Operating Lease, Liability | us-gaap:OperatingLeaseLiability |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Securities available for sale | |||
Mortgage servicing rights | $ 4,287 | $ 3,085 | $ 2,610 |
Quoted Prices In Active Markets for Identical Assets (Level 1) | |||
Securities available for sale | |||
Mortgage servicing rights | 0 | 0 | |
Significant Other Other Inputs (Level 2) | |||
Securities available for sale | |||
Mortgage servicing rights | 4,287 | 3,085 | |
Significant Unobservable Inputs (Level 3) | |||
Securities available for sale | |||
Mortgage servicing rights | 0 | 0 | |
Corporate notes [Member] | |||
Securities available for sale | |||
Instruments Measured At Fair Value | 51,720 | 16,444 | |
Mortgage servicing rights | 62,955 | ||
Corporate notes [Member] | Quoted Prices In Active Markets for Identical Assets (Level 1) | |||
Securities available for sale | |||
Instruments Measured At Fair Value | 0 | 0 | |
Mortgage servicing rights | 0 | ||
Corporate notes [Member] | Significant Other Other Inputs (Level 2) | |||
Securities available for sale | |||
Instruments Measured At Fair Value | 51,720 | 16,444 | |
Mortgage servicing rights | 62,955 | ||
Corporate notes [Member] | Significant Unobservable Inputs (Level 3) | |||
Securities available for sale | |||
Instruments Measured At Fair Value | 0 | 0 | |
Mortgage servicing rights | 0 | ||
Obligations of U.S.Government sponsored agencies | |||
Securities available for sale | |||
Instruments Measured At Fair Value | 12,060 | ||
Obligations of U.S.Government sponsored agencies | Quoted Prices In Active Markets for Identical Assets (Level 1) | |||
Securities available for sale | |||
Instruments Measured At Fair Value | 0 | ||
Obligations of U.S.Government sponsored agencies | Significant Other Other Inputs (Level 2) | |||
Securities available for sale | |||
Instruments Measured At Fair Value | 12,060 | ||
Obligations of U.S.Government sponsored agencies | Significant Unobservable Inputs (Level 3) | |||
Securities available for sale | |||
Instruments Measured At Fair Value | 0 | ||
Obligations of states and political subdivisions [Member] | |||
Securities available for sale | |||
Instruments Measured At Fair Value | 54,771 | 51,893 | |
Obligations of states and political subdivisions [Member] | Quoted Prices In Active Markets for Identical Assets (Level 1) | |||
Securities available for sale | |||
Instruments Measured At Fair Value | 0 | 0 | |
Obligations of states and political subdivisions [Member] | Significant Other Other Inputs (Level 2) | |||
Securities available for sale | |||
Instruments Measured At Fair Value | 54,771 | 51,493 | |
Obligations of states and political subdivisions [Member] | Significant Unobservable Inputs (Level 3) | |||
Securities available for sale | |||
Instruments Measured At Fair Value | $ 0 | 400 | |
Mortgage-backed securities [Member] | |||
Securities available for sale | |||
Instruments Measured At Fair Value | 50,569 | ||
Mortgage-backed securities [Member] | Quoted Prices In Active Markets for Identical Assets (Level 1) | |||
Securities available for sale | |||
Instruments Measured At Fair Value | 0 | ||
Mortgage-backed securities [Member] | Significant Other Other Inputs (Level 2) | |||
Securities available for sale | |||
Instruments Measured At Fair Value | 50,569 | ||
Mortgage-backed securities [Member] | Significant Unobservable Inputs (Level 3) | |||
Securities available for sale | |||
Instruments Measured At Fair Value | $ 0 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Fair value of assets measured on a recurring basis (Details) - Obligations of states and political subdivisions [Member] - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Total securities at beginning of year | $ 400 | $ 500 |
Included in earnings | 0 | 0 |
Included in other comprehensive income | 0 | 0 |
Purchases, issuance, and settlements | (400) | (100) |
Transfer in and/or out of level 3 | 0 | 0 |
Total securities at end of period | $ 0 | $ 400 |
Fair Value of Financial Instr_5
Fair Value of Financial Instruments - Fair value of assets measured on a non-recurring basis (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Other real estate owned | $ 6,888 | $ 3,592 | $ 6,270 |
Impaired Loans, net of impairment reserve | 6,847 | 20,872 | |
Assets, Fair Value Disclosure | 13,735 | 24,464 | |
Fair Value, Measurements, Nonrecurring [Member] | |||
Other real estate owned | 6,888 | 3,592 | |
Impaired Loans, net of impairment reserve | 6,847 | 20,872 | |
Assets, Fair Value Disclosure | 13,735 | 24,464 | |
Quoted Prices In Active Markets for Identical Assets (Level 1) | Fair Value, Measurements, Nonrecurring [Member] | |||
Other real estate owned | 0 | 0 | |
Impaired Loans, net of impairment reserve | 0 | 0 | |
Assets, Fair Value Disclosure | 0 | 0 | |
Significant Other Other Inputs (Level 2) | Fair Value, Measurements, Nonrecurring [Member] | |||
Other real estate owned | 0 | 0 | |
Impaired Loans, net of impairment reserve | 0 | 0 | |
Assets, Fair Value Disclosure | $ 0 | $ 0 |
Fair Value of Financial Instr_6
Fair Value of Financial Instruments - Fair value measurement on inputs and valuation techniques (Details) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Third party appraisals, sales contracts or brokered price options | ||
Other real estate owned | Collateral discounts and estimated costs to sell | Collateral discounts and estimated costs to sell |
Third party appraisals, sales contracts or brokered price options | Maximum [Member] | Measurement Input, Discount Rate [Member] | ||
Other real estate owned | 61 | 40 |
Third party appraisals, sales contracts or brokered price options | Minimum [Member] | Measurement Input, Discount Rate [Member] | ||
Other real estate owned | 0 | 0 |
Third party appraisals, sales contracts or brokered price options | Weighted Average [Member] | Measurement Input, Discount Rate [Member] | ||
Other real estate owned | 33.5 | 18.6 |
Third party appraisals and discounted cash flows | ||
Impaired Loans, Unobservable Inputs | Collateral discounts and discount rates | Collateral discounts and discount rates |
Third party appraisals and discounted cash flows | Maximum [Member] | Measurement Input, Discount Rate [Member] | ||
Loans Held-for-sale, Measurement Input | 100 | 100 |
Third party appraisals and discounted cash flows | Minimum [Member] | Measurement Input, Discount Rate [Member] | ||
Loans Held-for-sale, Measurement Input | 0 | 0 |
Third party appraisals and discounted cash flows | Weighted Average [Member] | Measurement Input, Discount Rate [Member] | ||
Loans Held-for-sale, Measurement Input | 6.1 | 9.3 |
Fair Value of Financial Instr_7
Fair Value of Financial Instruments - Carrying value and estimated fair value (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Financial assets: | |||
Securities held to maturity | $ 44,803 | $ 40,477 | |
Securities available for sale | 181,506 | 118,906 | |
Loans, net | 6,847 | 20,872 | |
Mortgage servicing rights | 4,287 | 3,085 | $ 2,610 |
Quoted Prices In Active Markets for Identical Assets (Level 1) | |||
Financial assets: | |||
Mortgage servicing rights | 0 | 0 | |
Significant Other Other Inputs (Level 2) | |||
Financial assets: | |||
Mortgage servicing rights | 4,287 | 3,085 | |
Significant Unobservable Inputs (Level 3) | |||
Financial assets: | |||
Mortgage servicing rights | 0 | 0 | |
Carrying Amount [Member] | |||
Financial assets: | |||
Cash and cash equivalents | 86,452 | 107,743 | |
Securities held to maturity | 43,734 | 40,768 | |
Securities available for sale | 181,506 | 118,906 | |
Loans held for sale | 587 | ||
Loans, net | 1,724,947 | 1,416,246 | |
Other investments, at cost | 4,933 | 4,555 | |
Mortgage servicing rights | 4,287 | 3,085 | |
Cash surrender value of life insurance | 24,945 | 24,178 | |
Financial liabilities: | |||
Deposits | 1,843,311 | 1,557,167 | |
Securities sold under repurchase agreements | 45,865 | 31,489 | |
Notes Payable | 49,790 | ||
Subordinated notes | 18,622 | 11,500 | |
Carrying Amount [Member] | Quoted Prices In Active Markets for Identical Assets (Level 1) | |||
Financial assets: | |||
Cash and cash equivalents | 86,452 | 107,743 | |
Securities held to maturity | 0 | ||
Securities available for sale | 0 | ||
Loans held for sale | 0 | ||
Loans, net | 0 | ||
Other investments, at cost | 0 | ||
Mortgage servicing rights | 0 | ||
Cash surrender value of life insurance | 24,945 | 24,178 | |
Financial liabilities: | |||
Deposits | 0 | ||
Securities sold under repurchase agreements | 0 | ||
Notes Payable | 0 | ||
Subordinated notes | 0 | ||
Carrying Amount [Member] | Significant Other Other Inputs (Level 2) | |||
Financial assets: | |||
Cash and cash equivalents | 0 | ||
Securities held to maturity | 44,803 | 40,477 | |
Securities available for sale | 181,506 | 118,506 | |
Loans held for sale | 0 | ||
Loans, net | 0 | ||
Other investments, at cost | 0 | ||
Mortgage servicing rights | 4,287 | 3,085 | |
Cash surrender value of life insurance | 0 | ||
Financial liabilities: | |||
Deposits | 0 | ||
Securities sold under repurchase agreements | 45,865 | 31,489 | |
Notes Payable | 49,790 | ||
Subordinated notes | 18,622 | 11,500 | |
Carrying Amount [Member] | Significant Unobservable Inputs (Level 3) | |||
Financial assets: | |||
Cash and cash equivalents | 0 | ||
Securities held to maturity | 0 | ||
Securities available for sale | 0 | 400 | |
Loans held for sale | 587 | ||
Loans, net | 1,723,542 | 1,400,538 | |
Other investments, at cost | 4,933 | 4,555 | |
Mortgage servicing rights | 0 | ||
Cash surrender value of life insurance | 0 | ||
Financial liabilities: | |||
Deposits | 1,783,638 | 1,449,552 | |
Securities sold under repurchase agreements | 0 | ||
Notes Payable | 0 | ||
Subordinated notes | 0 | ||
Estimated Fair Value [Member] | |||
Financial assets: | |||
Cash and cash equivalents | 86,452 | 107,743 | |
Securities held to maturity | 44,803 | 40,477 | |
Securities available for sale | 181,506 | 118,906 | |
Loans held for sale | 587 | ||
Loans, net | 1,723,542 | 1,400,538 | |
Other investments, at cost | 4,933 | 4,555 | |
Mortgage servicing rights | 4,287 | 3,085 | |
Cash surrender value of life insurance | 24,945 | 24,178 | |
Financial liabilities: | |||
Deposits | 1,783,638 | 1,449,552 | |
Securities sold under repurchase agreements | 45,865 | 31,489 | |
Notes Payable | 49,790 | ||
Subordinated notes | $ 18,622 | $ 11,500 |
Parent Company Only Financial_3
Parent Company Only Financial Statements - Balance Sheets (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Assets | ||||
Cash and cash equivalents | $ 86,452 | $ 107,743 | $ 101,977 | $ 80,157 |
Other assets | 7,481 | 6,970 | ||
TOTAL ASSETS | 2,210,168 | 1,793,165 | ||
Liabilities | ||||
Notes payable | 49,790 | 0 | ||
Subordinated notes | 18,622 | 11,500 | ||
Other liabilities | 22,369 | 18,686 | ||
Total liabilities | 1,979,957 | 1,618,842 | ||
Stockholders' equity: | ||||
Common stock | 79 | 74 | ||
Additional paid-in capital | 63,085 | 27,601 | ||
Retained earnings | 189,494 | 168,363 | ||
Treasury stock, at cost | (24,941) | (21,349) | ||
Accumulated other comprehensive income | 2,494 | (366) | ||
Total stockholders' equity | 230,211 | 174,323 | 161,728 | 127,523 |
Liabilities and Equity | 2,210,168 | 1,793,165 | ||
Parent Company [Member] | ||||
Assets | ||||
Cash and cash equivalents | 63 | 72 | $ 360 | $ 105 |
Investment in Bank | 254,299 | 183,290 | ||
Investment in Veritas | 4,852 | 2,381 | ||
Other assets | 557 | 978 | ||
TOTAL ASSETS | 259,771 | 186,721 | ||
Liabilities | ||||
Notes payable | 10,000 | 0 | ||
Subordinated notes | 18,500 | 11,500 | ||
Other liabilities | 1,060 | 898 | ||
Total liabilities | 29,560 | 12,398 | ||
Stockholders' equity: | ||||
Common stock | 79 | 74 | ||
Additional paid-in capital | 63,085 | 27,601 | ||
Retained earnings | 189,494 | 168,363 | ||
Treasury stock, at cost | (24,941) | (21,349) | ||
Accumulated other comprehensive income | 2,494 | (366) | ||
Total stockholders' equity | 230,211 | 174,323 | ||
Liabilities and Equity | $ 259,771 | $ 186,721 |
Parent Company Only Financial_4
Parent Company Only Financial Statements - Statements of Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income: | |||||||||||
Total interest income | $ 23,795 | $ 25,489 | $ 20,158 | $ 19,723 | $ 19,753 | $ 19,510 | $ 19,372 | $ 19,309 | $ 89,165 | $ 77,944 | $ 53,472 |
Other | 6,026 | 5,029 | 3,201 | ||||||||
Benefit for income taxes | 2,225 | 1,712 | 1,666 | 1,992 | 1,362 | 1,604 | 1,431 | 2,200 | 7,595 | 6,597 | 8,826 |
Net Income | $ 7,459 | $ 6,659 | $ 5,989 | $ 6,587 | $ 6,061 | $ 5,932 | $ 6,400 | $ 7,063 | 26,694 | 25,456 | 15,313 |
Parent Company [Member] | |||||||||||
Income: | |||||||||||
Dividends received from Bank | 16,335 | 22,275 | 19,480 | ||||||||
Equity in undistributed earnings of subsidiaries | 11,361 | 4,029 | (3,773) | ||||||||
Other income | 234 | 74 | 0 | ||||||||
Total interest income | 27,930 | 26,378 | 15,707 | ||||||||
Other | 1,611 | 1,404 | 648 | ||||||||
Benefit for income taxes | (375) | (482) | (254) | ||||||||
Net Income | $ 26,694 | $ 25,456 | $ 15,313 |
Parent Company Only Financial_5
Parent Company Only Financial Statements - Statements of Cash Flows (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash flows from operating activities: | |||
Net income | $ 26,694 | $ 25,456 | $ 15,313 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||
Stock compensation | 685 | 556 | 465 |
Changes in other assets and liabilities: | |||
Other assets | (720) | 306 | 278 |
Other liabilities | 1,268 | 1,220 | 4,450 |
Net cash provided by (used in) operating activities | 22,648 | 23,052 | 18,323 |
Cash flows from investing activities, net of effects of business combination: | |||
Net cash used in business combination | (9,771) | 0 | (19,882) |
Net cash provided by (used in) investing activities | (106,153) | (30,098) | (41,425) |
Cash flows from financing activities, net of effects of business combination: | |||
Issuance of common stock | 0 | 1,347 | 896 |
Repurchase of common stock | (4,205) | (10,449) | (3,631) |
Net cash provided by (used in) financing activities | 62,214 | 12,812 | 44,922 |
Net increase (decrease) in cash and cash equivalents | (21,291) | 5,766 | 21,820 |
Cash and cash equivalents at beginning of period | 107,743 | 101,977 | 80,157 |
Cash and cash equivalents at end of period | 86,452 | 107,743 | 101,977 |
Supplemental schedule of noncash activities: | |||
Amortization of unrealized holding gains on securities transferred from available for sale to held to maturity recognized in other comprehensive income, net of tax | (35) | (60) | (80) |
Change in unrealized gains and losses on investment securities available for sale, net of tax | 2,895 | (1,367) | 604 |
Parent Company [Member] | |||
Cash flows from operating activities: | |||
Net income | 26,694 | 25,456 | 15,313 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||
Stock compensation | 685 | 556 | 465 |
Equity in earnings of subsidiaries (includes dividends) | (27,696) | (26,304) | (15,707) |
Changes in other assets and liabilities: | |||
Other assets | (329) | (49) | (44) |
Other liabilities | (33) | (90) | 457 |
Net cash provided by (used in) operating activities | (679) | (431) | 484 |
Cash flows from investing activities, net of effects of business combination: | |||
Purchase of securities | 750 | 0 | 0 |
Dividends received from Bank | 16,335 | 22,275 | 19,480 |
Dividends received from Veritas | 0 | 0 | 450 |
Net cash used in business combination | (14,241) | 0 | (33,378) |
Contribution to subsidiaries | (2,620) | 0 | 0 |
Net cash provided by (used in) investing activities | 224 | 22,275 | (13,448) |
Cash flows from financing activities, net of effects of business combination: | |||
Proceeds from (repayment of) revolving line of credit | 10,000 | (5,000) | 5,000 |
Proceeds from (repayment of) note payable | 0 | (3,500) | 3,500 |
Proceeds from subordinated notes | 0 | 0 | 11,500 |
Cash dividends paid | (5,463) | (4,530) | (4,046) |
Issuance of common stock | 114 | 1,347 | 896 |
Repurchase of common stock | (4,205) | (10,449) | (3,631) |
Net cash provided by (used in) financing activities | 446 | (22,132) | 13,219 |
Net increase (decrease) in cash and cash equivalents | (9) | (288) | 255 |
Cash and cash equivalents at beginning of period | 72 | 360 | 105 |
Cash and cash equivalents at end of period | 63 | 72 | 360 |
Supplemental schedule of noncash activities: | |||
Amortization of unrealized holding gains on securities transferred from available for sale to held to maturity recognized in other comprehensive income, net of tax | (35) | (60) | (80) |
Change in unrealized gains and losses on investment securities available for sale, net of tax | $ 2,958 | $ (1,367) | $ 604 |
Earnings from Common Shares (De
Earnings from Common Shares (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Earnings Per Common Share | |||||||||||
Net income from operations | $ 7,459 | $ 6,659 | $ 5,989 | $ 6,587 | $ 6,061 | $ 5,932 | $ 6,400 | $ 7,063 | $ 26,694 | $ 25,456 | $ 15,313 |
Weighted average common shares outstanding | 6,647,586 | 6,661,337 | 6,672,344 | 6,714,347 | 6,820,225 | 6,673,758 | 6,285,901 | ||||
Effect of dilutive potential common shares | 82,391 | ||||||||||
Diluted weighted average common shares outstanding | 6,902,616 | 6,673,758 | 6,285,901 | ||||||||
Earnings per share - basic | $ 1.05 | $ 0.95 | $ 0.91 | $ 1 | $ 3.91 | $ 3.81 | $ 2.44 | ||||
Earnings per share - diluted | $ 1.04 | $ 0.93 | $ 0.90 | $ 1 | $ 3.87 | $ 3.81 | $ 2.44 |
Quarterly Results of Operatio_3
Quarterly Results of Operations (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Interest income | $ 23,795 | $ 25,489 | $ 20,158 | $ 19,723 | $ 19,753 | $ 19,510 | $ 19,372 | $ 19,309 | $ 89,165 | $ 77,944 | $ 53,472 |
Interest expense | 5,015 | 5,176 | 4,784 | 4,523 | 4,240 | 3,974 | 3,604 | 3,027 | 19,498 | 14,845 | 7,732 |
Net interest and dividend income | 18,780 | 20,313 | 15,374 | 15,200 | 15,513 | 15,536 | 15,768 | 16,282 | 69,667 | 63,099 | 45,740 |
Provision for loan losses | 1,125 | 3,000 | 500 | 625 | 750 | 800 | 900 | 485 | 5,250 | 2,935 | 1,055 |
Net interest and dividend income after provision for loan losses | 17,655 | 17,313 | 14,874 | 14,575 | 14,763 | 14,736 | 14,868 | 15,797 | 64,417 | 60,164 | 44,685 |
Noninterest Income | 3,211 | 3,145 | 2,736 | 3,540 | 2,553 | 2,508 | 3,027 | 3,443 | 12,632 | 11,500 | 9,816 |
Noninterest Expense | 11,182 | 12,087 | 9,955 | 9,536 | 9,893 | 9,708 | 10,064 | 9,977 | 42,760 | 39,611 | 30,362 |
Income before provision for income taxes | 9,684 | 8,371 | 7,655 | 8,579 | 7,423 | 7,536 | 7,831 | 9,263 | 34,289 | 32,053 | 24,139 |
Provision for income taxes | 2,225 | 1,712 | 1,666 | 1,992 | 1,362 | 1,604 | 1,431 | 2,200 | 7,595 | 6,597 | 8,826 |
Net Income | $ 7,459 | $ 6,659 | $ 5,989 | $ 6,587 | $ 6,061 | $ 5,932 | $ 6,400 | $ 7,063 | $ 26,694 | $ 25,456 | $ 15,313 |
Share data | |||||||||||
Weighted Average Number of Shares Outstanding, Basic and Diluted | 6,647,586 | 6,661,337 | 6,672,344 | 6,714,347 | 6,820,225 | 6,673,758 | 6,285,901 | ||||
Weighted Average Number Of Share Outstanding Basic | 7,084,728 | 7,036,807 | 6,577,016 | 6,574,362 | |||||||
Weighted Average Number Of Share Outstanding Diluted | 7,182,854 | 7,134,674 | 6,675,794 | 6,608,273 | |||||||
Earnings Per Share, Basic and Diluted | $ 0.91 | $ 0.89 | $ 0.96 | $ 1.05 | |||||||
Earnings Per Share, Basic | $ 1.05 | $ 0.95 | $ 0.91 | $ 1 | $ 3.91 | $ 3.81 | $ 2.44 | ||||
Earnings Per Share, Diluted | $ 1.04 | $ 0.93 | $ 0.90 | $ 1 | $ 3.87 | $ 3.81 | $ 2.44 |
Pending Merger Transaction (Det
Pending Merger Transaction (Details) - USD ($) | Nov. 20, 2019 | Dec. 31, 2019 | Dec. 31, 2018 |
Assets | $ 2,210,168,000 | $ 1,793,165,000 | |
Loans and Leases Receivable, Net Amount | 1,724,947,000 | 1,416,246,000 | |
Deposits. | 1,843,311,000 | $ 1,557,167,000 | |
Tomah Bancshares [Member] | |||
Business Combination Contingent Consideration Percentage Of Equity Issued | 100.00% | ||
Business Combination, Contingent Consideration, Liability | $ 32,600,000 | ||
Assets | 2,400,000,000 | ||
Loans and Leases Receivable, Net Amount | 1,800,000,000 | ||
Deposits. | $ 2,000,000,000 |