Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2017 | Jul. 24, 2017 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | SOUTHSIDE BANCSHARES INC | |
Entity Central Index Key | 705,432 | |
Current Fiscal Year End Date | --12-31 | |
Entity Well-known Seasoned Issuer | No | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 29,343,954 |
CONSOLIDATED BALANCE SHEETS (UN
CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($) | Jun. 30, 2017 | Dec. 31, 2016 | |
ASSETS | |||
Cash and due from banks | $ 56,033,000 | $ 59,363,000 | |
Interest earning deposits | 175,039,000 | 102,251,000 | |
Federal funds sold | 4,760,000 | 8,040,000 | |
Total cash and cash equivalents | 235,832,000 | 169,654,000 | |
Securities available for sale, at estimated fair value | 1,397,811,000 | 1,479,600,000 | |
Securities held to maturity, at carrying value (estimated fair value of $943,776 and $944,282, respectively) | 925,538,000 | 937,487,000 | |
FHLB stock, at cost | 61,561,000 | 61,084,000 | |
Other investments | 5,424,000 | 5,508,000 | |
Loans held for sale | 3,036,000 | 7,641,000 | |
Loans: | |||
Loans | [1] | 2,610,198,000 | 2,556,537,000 |
Less: Allowance for loan losses | [2] | (19,241,000) | (17,911,000) |
Net Loans | 2,590,957,000 | 2,538,626,000 | |
Premises and equipment, net | 105,938,000 | 106,003,000 | |
Goodwill | 91,520,000 | 91,520,000 | |
Other intangible assets, net | 3,767,000 | 4,608,000 | |
Interest receivable | 23,220,000 | 25,183,000 | |
Deferred tax asset, net | 22,428,000 | 28,891,000 | |
Unsettled trades to sell securities | 0 | 0 | |
Unsettled issuances of brokered certificates of deposit | 0 | 0 | |
Bank owned life insurance | 99,011,000 | 97,775,000 | |
Other assets | 12,439,000 | 10,187,000 | |
Total assets | 5,578,482,000 | 5,563,767,000 | |
Deposits: | |||
Noninterest bearing | 757,353,000 | 704,013,000 | |
Interest bearing | 2,866,720,000 | 2,829,063,000 | |
Total deposits | 3,624,073,000 | 3,533,076,000 | |
Short-term obligations: | |||
Federal funds purchased and repurchase agreements | 8,424,000 | 7,097,000 | |
FHLB advances | 1,015,833,000 | 866,518,000 | |
Total short-term obligations | 1,024,257,000 | 873,615,000 | |
Long-term obligations: | |||
FHLB advances | 162,249,000 | 443,128,000 | |
Subordinated notes, net of unamortized debt issuance costs | 98,171,000 | 98,100,000 | |
Long-term debt, net of unamortized debt issuance costs | 60,238,000 | 60,236,000 | |
Total long-term obligations | 320,658,000 | 601,464,000 | |
Unsettled trades to purchase securities | 24,883,000 | 160,000 | |
Other liabilities | 37,546,000 | 37,178,000 | |
Total liabilities | 5,031,417,000 | 5,045,493,000 | |
Off-balance-sheet arrangements, commitments and contingencies (Note 13) | |||
Shareholders’ equity: | |||
Common stock ($1.25 par value, 40,000,000 shares authorized, 32,245,251 shares issued at June 30, 2017 and 31,455,951 shares issued at December 31, 2016) | 40,306,000 | 39,320,000 | |
Paid-in capital | 561,728,000 | 535,240,000 | |
Retained earnings | 19,408,000 | 30,098,000 | |
Treasury stock, at cost (2,901,297 shares at June 30, 2017 and 2,913,064 shares at December 31, 2016) | (47,832,000) | (47,891,000) | |
Accumulated other comprehensive loss | (26,545,000) | (38,493,000) | |
Total shareholders’ equity | 547,065,000 | 518,274,000 | |
Total liabilities and shareholders’ equity | $ 5,578,482,000 | $ 5,563,767,000 | |
[1] | Includes approximately $295.6 million and $372.4 million of loans acquired with the Omni acquisition as of June 30, 2017 and December 31, 2016, respectively. | ||
[2] | The allowance for loan loss recorded on purchase credit impaired (“PCI”) loans totaled $3,000 as of June 30, 2017 and December 31, 2016. |
CONSOLIDATED BALANCE SHEETS (U3
CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Held-to-maturity Securities, Other Disclosure Items [Abstract] | ||
Securities held to maturity, fair value | $ 943,776 | $ 944,282 |
Shareholders' equity: | ||
Common stock, par value (in dollars per share) | $ 1.25 | $ 1.25 |
Common stock, shares authorized (in shares) | 40,000,000 | 40,000,000 |
Common stock, shares issued (in shares) | 32,245,251 | 31,455,951 |
Treasury stock (in shares) | 2,901,297 | 2,913,064 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Interest income | ||||
Loans | $ 28,090 | $ 26,233 | $ 55,344 | $ 53,998 |
Investment securities – taxable | 267 | 107 | 644 | 321 |
Investment securities – tax-exempt | 6,157 | 5,137 | 12,711 | 10,492 |
Mortgage-backed securities | 10,818 | 9,366 | 20,863 | 18,757 |
FHLB stock and other investments | 299 | 185 | 597 | 402 |
Other interest earning assets | 378 | 61 | 738 | 131 |
Total interest income | 46,009 | 41,089 | 90,897 | 84,101 |
Interest expense | ||||
Deposits | 5,138 | 3,515 | 9,419 | 6,771 |
Short-term obligations | 2,480 | 906 | 4,545 | 1,602 |
Long-term obligations | 2,967 | 2,290 | 6,229 | 4,734 |
Total interest expense | 10,585 | 6,711 | 20,193 | 13,107 |
Net interest income | 35,424 | 34,378 | 70,704 | 70,994 |
Provision for loan losses | 1,346 | 3,768 | 2,444 | 6,084 |
Net interest income after provision for loan losses | 34,078 | 30,610 | 68,260 | 64,910 |
Noninterest income | ||||
Deposit services | 5,255 | 5,099 | 10,369 | 10,184 |
Net (loss) gain on sale of securities available for sale | (75) | 728 | 247 | 3,169 |
Gain on sale of loans | 505 | 873 | 1,206 | 1,516 |
Trust income | 899 | 869 | 1,789 | 1,724 |
Bank owned life insurance income | 635 | 647 | 1,269 | 1,321 |
Brokerage services | 682 | 535 | 1,229 | 1,110 |
Other | 1,392 | 619 | 2,857 | 1,942 |
Total noninterest income | 9,293 | 9,370 | 18,966 | 20,966 |
Noninterest expense | ||||
Salaries and employee benefits | 14,915 | 14,849 | 30,834 | 32,581 |
Occupancy expense | 2,897 | 2,993 | 5,760 | 6,328 |
Advertising, travel & entertainment | 548 | 722 | 1,131 | 1,407 |
ATM and debit card expense | 889 | 736 | 1,816 | 1,448 |
Professional fees | 1,050 | 1,478 | 1,989 | 2,816 |
Software and data processing expense | 688 | 739 | 1,413 | 1,488 |
Telephone and communications | 476 | 468 | 1,002 | 952 |
FDIC insurance | 445 | 645 | 886 | 1,283 |
FHLB prepayment fees | 0 | 148 | 0 | 148 |
Other | 3,629 | 3,035 | 6,564 | 6,769 |
Total noninterest expense | 25,537 | 25,813 | 51,395 | 55,220 |
Income before income tax expense | 17,834 | 14,167 | 35,831 | 30,656 |
Income tax expense | 3,353 | 2,772 | 6,361 | 5,745 |
Net income | $ 14,481 | $ 11,395 | $ 29,470 | $ 24,911 |
Earnings per common share - basic (in dollars per share) | $ 0.49 | $ 0.42 | $ 1.01 | $ 0.92 |
Earnings per common share - diluted (in dollars per share) | 0.49 | 0.42 | 1 | 0.92 |
Dividends paid on common stock (in dollars per share) | $ 0.28 | $ 0.24 | $ 0.53 | $ 0.47 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 14,481 | $ 11,395 | $ 29,470 | $ 24,911 |
Securities available for sale and transferred securities: | ||||
Change in net unrealized holding gains on available for sale securities during the period | 13,221 | 16,247 | 18,106 | 43,991 |
Reclassification adjustment for amortization of unrealized losses on securities transferred to held to maturity | 213 | 87 | 701 | 144 |
Reclassification adjustment for net loss (gain) on sale of available for sale securities, included in net income | 75 | (728) | (247) | (3,169) |
Derivatives: | ||||
Change in net unrealized loss on effective cash flow hedge interest rate swap derivatives | (1,768) | (3,594) | (1,848) | (6,195) |
Change in net unrealized gains on interest rate swap derivatives terminated during the period | 0 | 0 | 273 | 0 |
Reclassification adjustment for net loss on interest rate swap derivatives, included in net income | 245 | 460 | 624 | 817 |
Reclassification adjustment for amortization of unrealized gains on terminated interest rate swap derivatives | (22) | 0 | (31) | 0 |
Pension plans: | ||||
Amortization of net actuarial loss, included in net periodic benefit cost | 416 | 502 | 807 | 913 |
Amortization of prior service (credit) cost, included in net periodic benefit cost | (2) | 8 | (4) | 4 |
Other comprehensive income, before tax | 12,378 | 12,982 | 18,381 | 36,505 |
Income tax expense related to items of other comprehensive income | (4,332) | (4,544) | (6,433) | (12,777) |
Other comprehensive income, net of tax | 8,046 | 8,438 | 11,948 | 23,728 |
Comprehensive income | $ 22,527 | $ 19,833 | $ 41,418 | $ 48,639 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (UNAUDITED) - USD ($) $ in Thousands | Total | Common Stock | Paid In Capital | Retained Earnings | Treasury Stock | Accumulated Other Comprehensive Income (Loss) |
Beginning Balance at Dec. 31, 2015 | $ 444,062 | $ 34,832 | $ 424,078 | $ 41,527 | $ (37,692) | $ (18,683) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 24,911 | 24,911 | ||||
Other comprehensive income | 23,728 | 23,728 | ||||
Issuance of common stock for dividend reinvestment plan (21,474 shares in 2017 and 23,015 shares in 2016) | 648 | 29 | 619 | |||
Purchase of common stock (443,426 shares) | (10,199) | (10,199) | ||||
Stock compensation expense | 758 | 758 | ||||
Tax benefits related to stock awards | 17 | 17 | ||||
Net issuance of common stock under employee stock plans (60,078 shares in 2017 and 23,168 shares in 2016) | 143 | 29 | 145 | (31) | ||
Cash dividends paid on common stock ($0.53 per share in 2017 and $0.47 per share in 2016) | (11,768) | (11,768) | ||||
Stock dividend declared (719,515 shares in 2017 and 1,252,353 shares in 2016) | 0 | 1,565 | 33,200 | (34,765) | ||
Ending Balance at Jun. 30, 2016 | 472,300 | 36,455 | 458,817 | 19,874 | (47,891) | 5,045 |
Beginning Balance at Mar. 31, 2016 | (3,393) | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Other comprehensive income | 8,438 | |||||
Ending Balance at Jun. 30, 2016 | 472,300 | 36,455 | 458,817 | 19,874 | (47,891) | 5,045 |
Beginning Balance at Dec. 31, 2016 | 518,274 | 39,320 | 535,240 | 30,098 | (47,891) | (38,493) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 29,470 | 29,470 | ||||
Other comprehensive income | 11,948 | 11,948 | ||||
Issuance of common stock for dividend reinvestment plan (21,474 shares in 2017 and 23,015 shares in 2016) | 721 | 27 | 694 | |||
Stock compensation expense | 913 | 913 | ||||
Net issuance of common stock under employee stock plans (60,078 shares in 2017 and 23,168 shares in 2016) | 890 | 60 | 820 | (49) | 59 | |
Cash dividends paid on common stock ($0.53 per share in 2017 and $0.47 per share in 2016) | (15,151) | (15,151) | ||||
Stock dividend declared (719,515 shares in 2017 and 1,252,353 shares in 2016) | 0 | 899 | 24,061 | (24,960) | ||
Ending Balance at Jun. 30, 2017 | 547,065 | 40,306 | 561,728 | 19,408 | (47,832) | (26,545) |
Beginning Balance at Mar. 31, 2017 | (34,591) | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Other comprehensive income | 8,046 | |||||
Ending Balance at Jun. 30, 2017 | $ 547,065 | $ 40,306 | $ 561,728 | $ 19,408 | $ (47,832) | $ (26,545) |
CONSOLIDATED STATEMENTS OF CHA7
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (UNAUDITED) (Parenthetical) - $ / shares | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Statement of Stockholders' Equity [Abstract] | ||
Stock Issued During Period, Shares, Dividend Reinvestment Plan | 21,474 | 23,015 |
Dividends paid on common stock (in dollars per share) | $ 0.53 | $ 0.47 |
Treasury Stock, Shares, Acquired | 443,426 | |
Stock Issued During Period, Shares, Share-based Compensation, Net of Forfeitures | 60,078 | 23,168 |
Common Stock Dividends, Shares | 719,515 | 1,252,353 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
OPERATING ACTIVITIES: | ||
Net income | $ 29,470 | $ 24,911 |
Adjustments to reconcile net income to net cash provided by operations: | ||
Depreciation and net amortization | 4,846 | 4,328 |
Securities premium amortization (discount accretion), net | 8,756 | 9,366 |
Loan (discount accretion) premium amortization, net | (677) | (1,680) |
Provision for loan losses | 2,444 | 6,084 |
Stock compensation expense | 913 | 758 |
Deferred tax expense | 17 | 506 |
Net tax benefit related to stock awards | 0 | (17) |
Net gain on sale of securities available for sale | (247) | (3,169) |
Net loss (gain) on premises and equipment | 55 | (19) |
Gross proceeds from sales of loans held for sale | 39,582 | 42,602 |
Gross originations of loans held for sale | (34,977) | (44,674) |
Net (gain) loss on other real estate owned | (1) | 147 |
Net change in: | ||
Interest receivable | 1,963 | 506 |
Other assets | 2,479 | (2,599) |
Interest payable | 60 | 378 |
Other liabilities | (5,935) | (1,872) |
Net cash provided by operating activities | 48,748 | 35,556 |
Securities available for sale: | ||
Purchases | (272,410) | (355,720) |
Sales | 328,854 | 352,299 |
Maturities, calls and principal repayments | 62,242 | 97,816 |
Securities held to maturity: | ||
Purchases | (1,521) | (23,542) |
Maturities, calls and principal repayments | 11,316 | 9,206 |
Proceeds from redemption of FHLB stock and other investments | 114 | 3,644 |
Purchases of FHLB stock and other investments | (477) | (235) |
Net loans paydowns (originations) | (54,362) | 37,446 |
Purchases of premises and equipment | (3,926) | (3,327) |
Proceeds from sales of premises and equipment | 5 | 51 |
Proceeds from sales of other real estate owned | 134 | 587 |
Proceeds from sales of repossessed assets | 272 | 568 |
Net cash provided by investing activities | 70,241 | 118,793 |
FINANCING ACTIVITIES: | ||
Net change in deposits | 90,953 | 115,428 |
Net increase in federal funds purchased and repurchase agreements | 1,327 | 8,636 |
Proceeds from FHLB advances | 1,631,476 | 3,815,906 |
Repayment of FHLB advances | (1,763,027) | (4,090,022) |
Tax benefit related to stock awards | 0 | 17 |
Proceeds from stock option exercises | 1,022 | 194 |
Cash paid to tax authority from stock option exercises | (132) | (51) |
Purchase of common stock | 0 | (10,199) |
Proceeds from the issuance of common stock for dividend reinvestment plan | 721 | 648 |
Cash dividends paid | (15,151) | (11,768) |
Net cash used in financing activities | (52,811) | (171,211) |
Net increase (decrease) in cash and cash equivalents | 66,178 | (16,862) |
Cash and cash equivalents at beginning of period | 169,654 | 80,975 |
Cash and cash equivalents at end of period | 235,832 | 64,113 |
SUPPLEMENTAL DISCLOSURES FOR CASH FLOW INFORMATION: | ||
Interest paid | 20,134 | 12,727 |
Income taxes paid | 5,500 | 5,500 |
SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING AND FINANCING ACTIVITIES: | ||
Loans transferred to other repossessed assets and real estate through foreclosure | 263 | 764 |
Adjustment to pension liability | (803) | (917) |
Stock dividend (2.5% and 5%, respectively) | 24,960 | 34,765 |
Unsettled trades to purchase securities | $ (24,883) | $ (11,793) |
CONSOLIDATED STATEMENTS OF CAS9
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) | 6 Months Ended | |
Jun. 30, 2017Rate | Jun. 30, 2016Rate | |
Statement of Cash Flows [Abstract] | ||
Stock Dividends, Percentage of Common Stock | 2.50% | 5.00% |
Summary of Significant Accounti
Summary of Significant Accounting and Reporting Policies | 6 Months Ended |
Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Significant Accounting Policies [Text Block] | Summary of Significant Accounting and Reporting Policies Basis of Presentation In this report, the words “the Company,” “we,” “us,” and “our” refer to the combined entities of Southside Bancshares, Inc. and its subsidiaries. The words “Southside” and “Southside Bancshares” refer to Southside Bancshares, Inc. The words “Southside Bank” and “the Bank” refer to Southside Bank. “Omni” refers to OmniAmerican Bancorp, Inc., a bank holding company acquired by Southside on December 17, 2014. The consolidated balance sheet as of June 30, 2017 , and the related consolidated statements of income, comprehensive income, changes in shareholders’ equity, cash flows and notes to the financial statements for the three- and six- month periods ended June 30, 2017 and 2016 are unaudited; in the opinion of management, all adjustments necessary for a fair presentation of such financial statements have been included. Such adjustments consisted only of normal recurring items. All intercompany accounts and transactions are eliminated in consolidation. The preparation of these consolidated financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires the use of management’s estimates. These estimates are subjective in nature and involve matters of judgment. Actual amounts could differ from these estimates. On May 4, 2017, our board of directors declared a 2.5% stock dividend to common stock shareholders of record as of May 30, 2017, which was paid on June 27, 2017. All share data has been adjusted to give retroactive recognition to stock dividends. Interim results are not necessarily indicative of results for a full year. These financial statements should be read in conjunction with the financial statements and notes thereto in our Annual Report on Form 10-K for the year ended December 31, 2016 . Accounting Changes and Reclassifications Certain prior period amounts have been reclassified to conform to current year presentation. We adopted ASU 2016-09 “Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting,” on January 1, 2017 which requires all income tax effects related to settlements of share-based payment awards be reported in earnings as an increase (or decrease) to income tax expense. Previously, income tax benefits at settlement of an award were reported as an increase (or decrease) to additional paid-in capital to the extent that those benefits were greater than (or less than) the income tax benefits recognized in earnings during the vesting period or exercise of the award. The requirement to report those income tax effects in earnings has been applied to settlements occurring on or after January 1, 2017, and the impact of applying that guidance reduced reported income tax expense by $84,000 , or less than $0.01 on our diluted earnings per common share for the three months ended June 30, 2017 , and $210,000 , or $0.01 on our diluted earnings per common share for the six months ended June 30, 2017 . ASU 2016-09 also requires that all income tax-related cash flows resulting from share-based payments be reported as operating activities in the statement of cash flows. Previously, income tax benefits at settlement of an award were reported as a reduction to operating cash flows and an increase to financing cash flows to the extent that those benefits exceeded the income tax benefits reported in earnings during the vesting period or exercise of the award. We have elected to apply that change in cash flow on a prospective basis and therefore, prior periods have not been adjusted. ASU 2016-09 also requires the classification of employee taxes paid when an employer withholds shares for tax withholding purposes be classified as a financing activity in the statement of cash flow and be applied retrospectively. The requirement to report the employee taxes paid is reflected in prior period presentation in our consolidated statement of cash flows. In connection with the adoption of ASU 2016-09, we have also elected to recognize forfeitures as they occur. Terminated Derivative Financial Instruments In accordance with ASC Topic 815, if a hedging item is terminated prior to maturity for a cash settlement, the existing gain or loss within accumulated other comprehensive income (AOCI) will continue to be reclassified into earnings during the period or periods in which the hedged forecasted transaction affects earnings unless it is probable that the forecasted transaction will not occur by the end of the originally specified time period. If the forecasted transaction is deemed probable to not occur, the derivative gain or loss reported in accumulated other comprehensive income shall be reclassified into earnings immediately. During the first quarter of 2017, we terminated two interest rate swap contracts designated as cash flow hedges of forecasted transactions. At the time of termination, we determined that the underlying hedged forecasted transactions were still probable of occurring. These transactions are reevaluated on a monthly basis thereafter, to determine if the hedged forecasted transactions are still probable of occurring. If at a subsequent evaluation, it is determined that the transactions will not occur, any related gains or losses recorded in AOCI are immediately recognized in earnings. The existing gain in accumulated other comprehensive income related to the terminated interest rate swap contracts will be reclassified into earnings through straight-line accretion in the same periods the hedged forecasted transaction affects earnings. Further information on our derivative instruments and hedging activities is included in “Note 10 - Derivative Financial Instruments and Hedging Activities.” For a description of our significant accounting and reporting policies, refer to “Note 1- Summary of Significant Accounting and Reporting Policies” in our consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2016 . Accounting Pronouncements In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606).” This update states 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. This update affects entities that enter into contracts with customers to transfer goods or services or enter into contracts for the transfer of nonfinancial assets, unless those contracts are within the scope of other standards. In August 2015, the FASB issued ASU 2015-14, “Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date,” which defers the effective date of the previously issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) until the interim and annual reporting periods beginning after December 15, 2017. Early adoption is permitted. The guidance permits companies to either apply the requirements retrospectively to all prior periods presented, or apply the requirements in the year of adoption, through cumulative adjustment. We anticipate adopting the new standard using the modified retrospective method beginning January 1, 2018. Our revenue consists of net interest income on financial assets and financial liabilities, which is explicitly excluded from the scope of ASU 2014-09, and noninterest income. We have evaluated the impact this guidance will have in relation to our noninterest income derived from contracts with our customers as it relates to deposit services, trust income, brokerage services, and merchant services (included in other noninterest income) which we have determined to be in the scope of ASU 2014-09. The adoption of ASU 2014-09 is not expected to have a material impact on our financials. We are continuing to evaluate the impact of the additional disclosures required by this guidance. In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” ASU 2016-02 requires a lessee to recognize assets and liabilities for leases with lease terms of more than 12 months. Consistent with current GAAP, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a finance or operating lease. However, unlike current GAAP which requires only capital leases to be recognized on the balance sheet, the new ASU 2016-02 will require both finance (formerly known as “capital”) and operating leases to be recognized on the balance sheet. ASU 2016-02 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted. The guidance requires companies to apply the requirements in the year of adoption using a modified retrospective approach. We are currently evaluating the impact this guidance will have on our financial statements and we anticipate our assessment to be completed during the fiscal year 2018. In June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments. ASU 2016-13 also modifies the impairment model for available for sale debt securities and provides for a simplified accounting model for purchased financial assets with credit deterioration since their origination. ASU 2016-13 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The guidance requires companies to apply the requirements in the year of adoption through cumulative adjustment with some aspects of the update requiring a prospective transition approach. We are currently evaluating the potential impact of the pending adoption of ASU 2016-13 on our consolidated financial statements. In January 2017, the FASB issued ASU 2017-04, “Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment.” ASU 2017-04 is intended to simplify goodwill impairment testing by eliminating the second step of the analysis which requires the calculation of the implied fair value of goodwill to measure a goodwill impairment charge. The update requires entities to compare the fair value of a reporting unit with its carrying amount and recognize an impairment charge for any amount by which the carrying amount exceeds the reporting unit’s fair value, to the extent that the loss recognized does not exceed the amount of goodwill allocated to that reporting unit. ASU 2017-04 is effective for annual and interim goodwill impairment tests performed in periods beginning after December 15, 2019. Early adoption is permitted for annual and interim goodwill impairment testing dates after January 1, 2017. The guidance requires companies to apply the requirements prospectively in the year of adoption. ASU 2017-04 is not expected to have a significant impact on our consolidated financial statements. In March 2017, the FASB issued ASU 2017-07, “Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost.” ASU 2017-07 requires employers to present the service cost component of net periodic benefit cost in the same income statement line item as other employee compensation costs arising from services rendered during the period. Only the service cost component will be eligible for capitalization in assets. Employers are required to present the other components of the net periodic benefit cost separately from the line item that includes the service cost and outside of any subtotal of operating income, if one is presented. ASU 2017-07 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. Early adoption is permitted as of the beginning of an annual period for which financial statements (interim or annual) have not been issued or made available for issuance. We did not early adopt ASU 2017-04. The guidance requires companies to apply the requirements retrospectively to all prior periods presented. We are currently evaluating the potential impact of the pending adoption of ASU 2017-07 on our 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.” Under current GAAP, premiums on callable debt securities are generally amortized over the contractual life of the security. ASU 2017-08 requires the premium on callable debt securities to be amortized to the earliest call date. If the debt security is not called at the earliest call date, the holder of the debt security would be required to reset the effective yield on the debt security based on the payment terms required by the debt security. ASU 2017-08 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted. The guidance requires companies to apply the requirements on a modified retrospective basis through a cumulative adjustment directly to retained earnings as of the beginning of the period of adoption. We are currently evaluating the potential impact of the pending adoption of ASU 2017-08 on our consolidated financial statements. In May 2017, the FASB issued ASU 2017-09, “Compensation - Stock Compensation (Subtopic 718): Scope of Modification Accounting.” ASU 2017-09 clarifies when changes to terms or conditions of a share-based payment award must be accounted for as a modification. Under the new guidance, an entity will not apply modification accounting to a share-based payment award if all of the following are the same immediately before and after the change: (i) the fair value of the award, (ii) the vesting conditions of the award, and (iii) the classification of the award as either an equity or liability instrument. ASU 2017-09 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. Early adoption is permitted. The guidance requires companies to apply the requirements prospectively to awards modified on or after the adoption date. ASU 2017-09 is not expected to have a significant impact on our consolidated financial statements. |
Pending Acquisitions
Pending Acquisitions | 6 Months Ended |
Jun. 30, 2017 | |
Business Combinations [Abstract] | |
Pending Acquisition | Pending Acquisition On June 12, 2017, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Diboll State Bancshares, Inc., a Texas corporation (“Diboll”) and the holding company for First Bank & Trust East Texas, a Texas banking association based in Diboll, Texas. As of June 30, 2017, Diboll had $993.8 million in assets. The Merger Agreement provides that, subject to the terms and conditions thereof, Diboll will merge with and into the Company, with the Company as the surviving corporation. The merger is expected to close during the fourth quarter of 2017, after receipt of regulatory approvals, the approval of Diboll’s shareholders, and the satisfaction of other customary closing conditions. Pursuant to the Merger Agreement, the Company will issue 5,535,000 shares of Company common stock and up to $25.0 million in cash for all outstanding shares of Diboll stock, subject to adjustment pursuant to the terms of the Merger Agreement. |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Jun. 30, 2017 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Earnings per share on a basic and diluted basis has been adjusted to give retroactive recognition to stock dividends and is calculated as follows (in thousands, except per share amounts): Three Months Ended Six Months Ended 2017 2016 2017 2016 Basic and Diluted Earnings: Net income $ 14,481 $ 11,395 $ 29,470 $ 24,911 Basic weighted-average shares outstanding 29,318 26,890 29,303 27,002 Add: Stock awards 201 123 208 97 Diluted weighted-average shares outstanding 29,519 27,013 29,511 27,099 Basic Earnings Per Share: Net Income $ 0.49 $ 0.42 $ 1.01 $ 0.92 Diluted Earnings Per Share: Net Income $ 0.49 $ 0.42 $ 1.00 $ 0.92 For the three- and six- month periods ended June 30, 2017 , there were approximately 52,000 and 51,000 anti-dilutive shares, respectively. For the three- and six- month periods ended June 30, 2016 , there were approximately 23,000 and 54,000 anti-dilutive shares, respectively. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 6 Months Ended |
Jun. 30, 2017 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) The changes in accumulated other comprehensive income (loss) by component are as follows (in thousands): Three Months Ended June 30, 2017 Pension Plans Unrealized Gains (Losses) on Securities Unrealized Gains (Losses) on Derivatives Net Prior Service (Cost) Credit Net Gain (Loss) Total Beginning balance, net of tax $ (20,425 ) $ 4,961 $ (134 ) $ (18,993 ) $ (34,591 ) Other comprehensive income (loss): Other comprehensive income (loss) before reclassifications 13,221 (1,768 ) — — 11,453 Reclassified from accumulated other comprehensive income (loss) 288 223 (2 ) 416 925 Income tax (expense) benefit (4,728 ) 541 — (145 ) (4,332 ) Net current-period other comprehensive income (loss), net of tax 8,781 (1,004 ) (2 ) 271 8,046 Ending balance, net of tax $ (11,644 ) $ 3,957 $ (136 ) $ (18,722 ) $ (26,545 ) Six Months Ended June 30, 2017 Pension Plans Unrealized Gains (Losses) on Securities Unrealized Gains (Losses) on Derivatives Net Prior Net Gain (Loss) Total Beginning balance, net of tax $ (23,708 ) $ 4,595 $ (133 ) $ (19,247 ) $ (38,493 ) Other comprehensive income (loss): Other comprehensive income (loss) before reclassifications 18,106 (1,575 ) — — 16,531 Reclassified from accumulated other comprehensive income (loss) 454 593 (4 ) 807 1,850 Income tax (expense) benefit (6,496 ) 344 1 (282 ) (6,433 ) Net current-period other comprehensive income (loss), net of tax 12,064 (638 ) (3 ) 525 11,948 Ending balance, net of tax $ (11,644 ) $ 3,957 $ (136 ) $ (18,722 ) $ (26,545 ) Three Months Ended June 30, 2016 Pension Plans Unrealized Gains (Losses) on Securities Unrealized Gains (Losses) on Derivatives Net Prior Service (Cost) Credit Net Gain (Loss) Total Beginning balance, net of tax $ 16,245 $ (1,459 ) $ (47 ) $ (18,132 ) $ (3,393 ) Other comprehensive income (loss): Other comprehensive income (loss) before reclassifications 16,247 (3,594 ) — — 12,653 Reclassified from accumulated other comprehensive income (loss) (641 ) 460 8 502 329 Income tax (expense) benefit (5,462 ) 1,097 (3 ) (176 ) (4,544 ) Net current-period other comprehensive income (loss), net of tax 10,144 (2,037 ) 5 326 8,438 Ending balance, net of tax $ 26,389 $ (3,496 ) $ (42 ) $ (17,806 ) $ 5,045 Six Months Ended June 30, 2016 Pension Plans Unrealized Gains (Losses) on Securities Unrealized Gains (Losses) on Derivatives Net Prior Service (Cost) Credit Net Gain (Loss) Total Beginning balance, net of tax $ (239 ) $ — $ (44 ) $ (18,400 ) $ (18,683 ) Other comprehensive income (loss): Other comprehensive income (loss) before reclassifications 43,991 (6,195 ) — — 37,796 Reclassified from accumulated other comprehensive income (loss) (3,025 ) 817 4 913 (1,291 ) Income tax (expense) benefit (14,338 ) 1,882 (2 ) (319 ) (12,777 ) Net current-period other comprehensive income (loss), net of tax 26,628 (3,496 ) 2 594 23,728 Ending balance, net of tax $ 26,389 $ (3,496 ) $ (42 ) $ (17,806 ) $ 5,045 The reclassifications out of accumulated other comprehensive income (loss) into net income are presented below (in thousands): Three Months Ended Six Months Ended 2017 2016 2017 2016 Unrealized losses on securities transferred to held to maturity: Amortization of unrealized losses (1) $ (213 ) $ (87 ) $ (701 ) $ (144 ) Tax benefit 75 30 245 50 Net of tax $ (138 ) $ (57 ) $ (456 ) $ (94 ) Unrealized gains and losses on available for sale securities: Realized net (loss) gain on sale of securities (2) $ (75 ) $ 728 $ 247 $ 3,169 Tax benefit (expense) 26 (255 ) (86 ) (1,109 ) Net of tax $ (49 ) $ 473 $ 161 $ 2,060 Derivatives: Realized net loss on interest rate swap derivatives (3) $ (245 ) $ (460 ) $ (624 ) $ (817 ) Tax benefit 86 161 218 286 Net of tax $ (159 ) $ (299 ) $ (406 ) $ (531 ) Amortization of unrealized gains on terminated interest rate swap derivatives (3) $ 22 $ — $ 31 $ — Tax expense (8 ) — (11 ) — Net of tax $ 14 $ — $ 20 $ — Amortization of pension plan: Net actuarial loss (4) $ (416 ) $ (502 ) $ (807 ) $ (913 ) Prior service credit (cost) (4) 2 (8 ) 4 (4 ) Total before tax (414 ) (510 ) (803 ) (917 ) Tax benefit 145 179 281 321 Net of tax (269 ) (331 ) (522 ) (596 ) Total reclassifications for the period, net of tax $ (601 ) $ (214 ) $ (1,203 ) $ 839 (1) Included in interest income on the consolidated statements of income. (2) Listed as net (loss) gain on sale of securities available for sale on the consolidated statements of income. (3) Included in interest expense for long-term obligations on the consolidated statements of income. (4) These accumulated other comprehensive income components are included in the computation of net periodic pension cost (income) presented in “Note 8 - Employee Benefit Plans.” |
Securities
Securities | 6 Months Ended |
Jun. 30, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
Securities | Securities The amortized cost, gross unrealized gains and losses, carrying value, and estimated fair value of investment and mortgage-backed securities available for sale and held to maturity as of June 30, 2017 and December 31, 2016 are reflected in the tables below (in thousands): June 30, 2017 Recognized in OCI Not recognized in OCI Amortized Gross Unrealized Gross Unrealized Carrying Gross Gross Unrealized Estimated AVAILABLE FOR SALE Cost Gains Losses Value Gains Losses Fair Value Investment Securities: State and Political Subdivisions $ 330,155 $ 3,047 $ 7,043 $ 326,159 $ — $ — $ 326,159 Other Stocks and Bonds 5,059 85 — 5,144 — — 5,144 Other Equity Securities 6,034 — 80 5,954 — — 5,954 Mortgage-backed Securities: (1) Residential 651,291 7,376 4,563 654,104 — — 654,104 Commercial 405,217 2,467 1,234 406,450 — — 406,450 Total $ 1,397,756 $ 12,975 $ 12,920 $ 1,397,811 $ — $ — $ 1,397,811 HELD TO MATURITY Investment Securities: State and Political Subdivisions $ 429,146 $ 3,196 $ 12,517 $ 419,825 $ 12,529 $ 2,199 $ 430,155 Mortgage-backed Securities: (1) Residential 135,110 — 5,328 129,782 2,587 249 132,120 Commercial 379,250 983 4,302 375,931 6,364 794 381,501 Total $ 943,506 $ 4,179 $ 22,147 $ 925,538 $ 21,480 $ 3,242 $ 943,776 December 31, 2016 Recognized in OCI Not recognized in OCI Amortized Gross Unrealized Gross Unrealized Carrying Gross Gross Unrealized Estimated AVAILABLE FOR SALE Cost Gains Losses Value Gains Losses Fair Value Investment Securities: U.S. Treasury $ 74,016 $ — $ 3,947 $ 70,069 $ — $ — $ 70,069 State and Political Subdivisions 394,050 3,217 12,070 385,197 — — 385,197 Other Stocks and Bonds 6,587 64 — 6,651 — — 6,651 Other Equity Securities 6,039 — 119 5,920 — — 5,920 Mortgage-backed Securities: (1) Residential 630,603 6,434 9,529 627,508 — — 627,508 Commercial 386,109 1,201 3,055 384,255 — — 384,255 Total $ 1,497,404 $ 10,916 $ 28,720 $ 1,479,600 $ — $ — $ 1,479,600 HELD TO MATURITY Investment Securities: State and Political Subdivisions $ 435,080 $ 3,987 $ 13,257 $ 425,810 $ 7,595 $ 3,493 $ 429,912 Mortgage-backed Securities: (1) Residential 142,060 — 5,748 136,312 1,534 950 136,896 Commercial 379,016 1,067 4,718 375,365 4,372 2,263 377,474 Total $ 956,156 $ 5,054 $ 23,723 $ 937,487 $ 13,501 $ 6,706 $ 944,282 (1) All mortgage-backed securities issued and/or guaranteed by U.S. government agencies or U.S. government-sponsored enterprises. From time to time, we may transfer securities from available for sale (“AFS”) to held to maturity (“HTM”) due to overall balance sheet strategies. During 2016, the Company transferred securities with a fair value of $157.1 million from AFS to HTM. The unrealized loss on the securities transferred from AFS to HTM was $10.2 million ( $6.7 million , net of tax) at the date of transfer based on the fair value of the securities on the transfer date. Our management has the current intent and ability to hold the transferred securities until maturity. Any net unrealized gain or loss on the transferred securities included in accumulated other comprehensive income at the time of transfer will be amortized over the remaining life of the underlying security as an adjustment to the yield on those securities. AFS securities transferred with losses included in accumulated other comprehensive income continue to be included in management’s assessment for other-than-temporary impairment for each individual security. There were no securities transferred from AFS to HTM during the six months ended June 30, 2017 . The following tables represent the estimated fair value and unrealized loss on securities AFS and HTM as of June 30, 2017 and December 31, 2016 (in thousands): As of June 30, 2017 Less Than 12 Months More Than 12 Months Total Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss AVAILABLE FOR SALE Investment Securities: State and Political Subdivisions $ 211,790 $ 6,653 $ 8,285 $ 390 $ 220,075 $ 7,043 Other Equity Securities 5,954 80 — — 5,954 80 Mortgage-backed Securities: Residential 232,169 3,391 22,832 1,172 255,001 4,563 Commercial 98,096 1,234 — — 98,096 1,234 Total $ 548,009 $ 11,358 $ 31,117 $ 1,562 $ 579,126 $ 12,920 HELD TO MATURITY Investment Securities: State and Political Subdivisions $ 59,673 $ 706 $ 32,490 $ 1,493 $ 92,163 $ 2,199 Mortgage-backed Securities: Residential 18,607 249 — — 18,607 249 Commercial 49,291 794 — — 49,291 794 Total $ 127,571 $ 1,749 $ 32,490 $ 1,493 $ 160,061 $ 3,242 As of December 31, 2016 Less Than 12 Months More Than 12 Months Total Fair Value Unrealized Fair Value Unrealized Fair Value Unrealized AVAILABLE FOR SALE Investment Securities: U.S. Treasury $ 70,069 $ 3,947 $ — $ — $ 70,069 $ 3,947 State and Political Subdivisions 264,485 12,069 887 1 265,372 12,070 Other Equity Securities 5,920 119 — — 5,920 119 Mortgage-backed Securities: Residential 369,903 9,491 6,199 38 376,102 9,529 Commercial 245,422 3,055 — — 245,422 3,055 Total $ 955,799 $ 28,681 $ 7,086 $ 39 $ 962,885 $ 28,720 HELD TO MATURITY Investment Securities: State and Political Subdivisions $ 179,939 $ 2,190 $ 29,427 $ 1,303 $ 209,366 $ 3,493 Mortgage-backed Securities: Residential 107,024 950 — — 107,024 950 Commercial 186,854 2,263 — — 186,854 2,263 Total $ 473,817 $ 5,403 $ 29,427 $ 1,303 $ 503,244 $ 6,706 We review those securities in an unrealized loss position for significant differences between fair value and the cost basis to evaluate if a classification of other-than-temporary impairment is warranted. In estimating other-than-temporary impairment losses, management considers, among other things, the length of time and the extent to which the fair value has been less than cost and the financial condition and near-term prospects of the issuer. We consider an other-than-temporary impairment to have occurred when there is an adverse change in expected cash flows. When it is determined that a decline in fair value of HTM or AFS securities is other-than-temporary, the carrying value of the security is reduced to its estimated fair value, with a corresponding charge to earnings for the credit portion and a charge to other comprehensive income for the noncredit portion. Based upon the length of time and the extent to which fair value is less than cost, we believe that none of the securities with an unrealized loss have other-than-temporary impairment at June 30, 2017 . The majority of the securities in an unrealized loss position are highly rated municipal securities and U.S. Agency mortgage-backed securities (“MBS”) where the unrealized loss is a direct result of the change in interest rates and spreads. For those securities in an unrealized loss position, we do not currently intend to sell the securities and it is not more likely than not that we will be required to sell the securities before the anticipated recovery of their amortized cost basis. To the best of management’s knowledge and based on our consideration of the qualitative factors associated with each security, there were no securities in our investment and MBS portfolio with an other-than-temporary impairment at June 30, 2017 . Our equity securities consist of investments that are deemed to be qualified under the Community Reinvestment Act (CRA) of 1977. We primarily invest in securities issued by Fannie Mae, Freddie Mac, and Ginnie Mae. We evaluate the near-term prospects of our other equity securities in relation to the severity and duration of the current unrealized loss position. Based upon that evaluation, management does not consider the other equity securities to be other-than-temporarily impaired at June 30, 2017 . The following tables present interest income recognized on securities for the periods presented (in thousands): Three Months Ended 2017 2016 U.S. Treasury $ 204 $ 21 State and Political Subdivisions 6,157 5,137 Other Stocks and Bonds 35 57 Other Equity Securities 28 29 Mortgage-backed Securities 10,818 9,366 Total interest income on securities $ 17,242 $ 14,610 Six Months Ended 2017 2016 U.S. Treasury $ 519 $ 148 State and Political Subdivisions 12,711 10,492 Other Stocks and Bonds 69 115 Other Equity Securities 56 58 Mortgage-backed Securities 20,863 18,757 Total interest income on securities $ 34,218 $ 29,570 Of the approximately $247,000 in net securities gains from the AFS portfolio for the six months ended June 30, 2017 , there were $3.6 million in realized gain positions and $3.3 million in realized loss positions. Of the $3.2 million in net securities gains from the AFS portfolio for the six months ended June 30, 2016 , there were $3.7 million in realized gain positions and $551,000 in realized loss positions. There were no sales from the HTM portfolio during the six months ended June 30, 2017 or 2016 . We calculate realized gains and losses on sales of securities under the specific identification method. The amortized cost, carrying value and estimated fair value of AFS and HTM securities at June 30, 2017 , are presented below by contractual maturity (in thousands). Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations. MBS are presented in total by category due to the fact that MBS typically are issued with stated principal amounts, and the securities are backed by pools of mortgages that have loans with varying maturities. The characteristics of the underlying pool of mortgages, such as fixed-rate or adjustable-rate, as well as prepayment risk, are passed on to the security holder. The term of a mortgage-backed pass-through security thus approximates the term of the underlying mortgages and can vary significantly due to prepayments. June 30, 2017 Amortized Cost Fair Value AVAILABLE FOR SALE Investment Securities: Due in one year or less $ 8,090 $ 8,220 Due after one year through five years 20,046 20,797 Due after five years through ten years 31,112 31,582 Due after ten years 275,966 270,704 335,214 331,303 Mortgage-backed Securities and Other Equity Securities: 1,062,542 1,066,508 Total $ 1,397,756 $ 1,397,811 June 30, 2017 Carrying Value Fair Value HELD TO MATURITY Investment Securities: Due in one year or less $ 22,130 $ 21,569 Due after one year through five years 41,941 42,155 Due after five years through ten years 106,435 108,483 Due after ten years 249,319 257,948 419,825 430,155 Mortgage-backed Securities: 505,713 513,621 Total $ 925,538 $ 943,776 Investment securities and MBS with carrying values of $1.21 billion and $1.50 billion were pledged as of June 30, 2017 and December 31, 2016 , respectively, to collateralize Federal Home Loan Bank of Dallas (“FHLB”) advances, repurchase agreements, and public funds or for other purposes as required by law. Securities with limited marketability, such as FHLB stock and other investments, are carried at cost, which approximates fair value and are assessed quarterly for other-than-temporary impairment. These securities have no maturity date. |
Loans and Allowance for Probabl
Loans and Allowance for Probable Loan Losses | 6 Months Ended |
Jun. 30, 2017 | |
Receivables [Abstract] | |
Loans and Allowance for Probable Loan Losses | Loans and Allowance for Probable Loan Losses Loans in the accompanying consolidated balance sheets are classified as follows (in thousands): June 30, 2017 December 31, 2016 Real Estate Loans: Construction $ 386,853 $ 380,175 1-4 Family Residential 615,405 637,239 Commercial 1,033,629 945,978 Commercial Loans 172,311 177,265 Municipal Loans 305,023 298,583 Loans to Individuals 96,977 117,297 Total Loans (1) 2,610,198 2,556,537 Less: Allowance for Loan Losses (2) 19,241 17,911 Net Loans $ 2,590,957 $ 2,538,626 (1) Includes approximately $295.6 million and $372.4 million of loans acquired with the Omni acquisition as of June 30, 2017 and December 31, 2016 , respectively. (2) The allowance for loan loss recorded on purchase credit impaired (“PCI”) loans totaled $3,000 as of June 30, 2017 and December 31, 2016 . Real Estate Construction Loans Our construction loans are collateralized by property located primarily in or near the market areas we serve. A number of our construction loans will be owner occupied upon completion. Construction loans for non-owner occupied projects are financed, but these typically have cash flows from leases with tenants, secondary sources of repayment, and in some cases, additional collateral. Our construction loans have both adjustable and fixed interest rates during the construction period. Construction loans to individuals are typically priced and made with the intention of granting the permanent loan on the property. Speculative and commercial construction loans are subject to underwriting standards similar to that of the commercial portfolio. Owner occupied 1-4 family residential construction loans are subject to the underwriting standards of the permanent loan. Real Estate 1-4 Family Residential Loans Residential loan originations are generated by our loan officers, in-house origination staff, marketing efforts, present customers, walk-in customers and referrals from real estate agents and builders. We focus our lending efforts primarily on the origination of loans secured by first mortgages on owner occupied 1-4 family residences. Substantially all of our 1-4 family residential originations are secured by properties located in or near our market areas. Our 1-4 family residential loans generally have maturities ranging from five to 30 years. These loans are typically fully amortizing with monthly payments sufficient to repay the total amount of the loan. Our 1-4 family residential loans are made at both fixed and adjustable interest rates. Underwriting for 1-4 family residential loans includes debt-to-income analysis, credit history analysis, appraised value and down payment considerations. Changes in the market value of real estate can affect the potential losses in the portfolio. Commercial Real Estate Loans Commercial real estate loans as of June 30, 2017 consisted of $962.1 million of owner and non-owner occupied real estate, $68.6 million of loans secured by multi-family properties and $2.9 million of loans secured by farmland. Commercial real estate loans primarily include loans collateralized by retail, commercial office buildings, multi-family residential buildings, medical facilities and offices, senior living, assisted living and skilled nursing facilities, warehouse facilities, hotels and churches. In determining whether to originate commercial real estate loans, we generally consider such factors as the financial condition of the borrower and the debt service coverage of the property. Commercial real estate loans are made at both fixed and adjustable interest rates for terms generally up to 20 years. Commercial Loans Our commercial loans are diversified loan types including short-term working capital loans for inventory and accounts receivable and short- and medium-term loans for equipment or other business capital expansion. Management does not consider there to be a concentration of risk in any one industry type. In our commercial loan underwriting, we assess the creditworthiness, ability to repay, and the value and liquidity of the collateral being offered. Terms of commercial loans are generally commensurate with the useful life of the collateral offered. Municipal Loans We have a specific lending department that makes loans to municipalities and school districts primarily throughout the state of Texas. Municipal loans outside the state of Texas have been limited to adjoining states. The majority of the loans to municipalities and school districts have tax or revenue pledges and in some cases are additionally supported by collateral. Municipal loans made without a direct pledge of taxes or revenues are usually made based on some type of collateral that represents an essential service. Loans to Individuals Substantially all originations of our loans to individuals are made to consumers in our market areas. The majority of loans to individuals are collateralized by titled equipment, which are primarily automobiles. Loan terms vary according to the type and value of collateral, length of contract and creditworthiness of the borrower. The underwriting standards we employ for consumer loans include an application, a determination of the applicant’s payment history on other debts, with the greatest weight being given to payment history with us, and an assessment of the borrower’s ability to meet existing obligations and payments on the proposed loan. Although creditworthiness of the applicant is a primary consideration, the underwriting process also includes a comparison of the value of the collateral, if any, in relation to the proposed loan amount. Most of our loans to individuals are collateralized, which management believes should assist in limiting our exposure. Allowance for Loan Losses The allowance for loan losses is based on the most current review of the loan portfolio and is a result of multiple processes. First, we utilize historical net charge-off data to establish general reserve amounts for each class of loans. The historical charge-off figure is further adjusted through qualitative factors that include general trends in past dues, nonaccruals and classified loans to more effectively and promptly react to both positive and negative movements not reflected in the historical data. Second, our lenders have the primary responsibility for identifying problem loans based on customer financial stress and underlying collateral. These recommendations are reviewed by senior loan administration, the special assets department, and the loan review department on a monthly basis. Third, the loan review department independently reviews the portfolio on an annual basis. The loan review department follows a board-approved annual loan review scope. The loan review scope encompasses a number of considerations including the size of the loan, the type of credit extended, the seasoning of the loan and the performance of the loan. The loan review scope, as it relates to size, focuses more on larger dollar loan relationships, typically aggregate debt of $500,000 or greater. The loan review officer also reviews specific reserves compared to general reserves to determine trends in comparative reserves as well as losses not reserved for prior to charge-off to determine the effectiveness of the specific reserve process. At each review, a subjective analysis methodology is used to grade the respective loan. Categories of grading vary in severity from loans that do not appear to have a significant probability of loss at the time of review to loans that indicate a probability that the entire balance of the loan will be uncollectible. If at the time of review we determine it is probable that we will not collect the principal and interest cash flows contractually due on the loan, estimates of future expected cash flows or appraisals of the collateral securing the debt are used to determine the necessary allowances. The internal loan review department maintains a list (“Watch List”) of all loans or loan relationships that are graded as having more than the normal degree of risk associated with them. In addition, a list of specifically reserved loans or loan relationships of $150,000 or more is updated on a quarterly basis in order to properly determine necessary allowances and keep management informed on the status of attempts to correct the deficiencies noted with respect to the loan. We calculate historical loss ratios for pools of loans with similar characteristics based on the proportion of actual charge-offs experienced, consistent with the characteristics of remaining loans, to the total population of loans in the pool. The historical gross loss ratios are updated quarterly based on actual charge-off experience and adjusted for qualitative factors. All loans are subject to individual analysis if determined to be impaired with the exception of consumer loans and loans secured by 1-4 family residential loans. Industry and our own experience indicates that a portion of our loans will become delinquent and a portion of our loans will require partial or full charge-off. Regardless of the underwriting criteria utilized, losses may occur as a result of various factors beyond our control, including, among other things, changes in market conditions affecting the value of properties used as collateral for loans and problems affecting the credit worthiness of the borrower and the ability of the borrower to make payments on the loan. Our determination of the appropriateness of the allowance for loan losses is based on various considerations, including an analysis of the risk characteristics of various classifications of loans, previous loan loss experience, specific loans which have loan loss potential, delinquency trends, estimated fair value of the underlying collateral, current economic conditions, and geographic and industry loan concentration. Credit Quality Indicators We categorize loans into risk categories on an ongoing basis based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. We use the following definitions for risk ratings: • Pass (Rating 1 – 4) – This rating is assigned to all satisfactory loans. This category, by definition, consists of acceptable credit. Credit and collateral exceptions should not be present, although their presence would not necessarily prohibit a loan from being rated Pass, if deficiencies are in the process of correction. These loans are not included in the Watch List. • Pass Watch (Rating 5) – These loans require some degree of special treatment, but not due to credit quality. This category does not include loans specially mentioned or adversely classified; however, particular attention is warranted to characteristics such as: ◦ A lack of, or abnormally extended payment program; ◦ A heavy degree of concentration of collateral without sufficient margin; ◦ A vulnerability to competition through lesser or extensive financial leverage; and ◦ A dependence on a single or few customers or sources of supply and materials without suitable substitutes or alternatives. • Special Mention (Rating 6) – A Special Mention asset has potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or in our credit position at some future date. Special Mention loans are not adversely classified and do not expose us to sufficient risk to warrant adverse classification. • Substandard (Rating 7) – Substandard loans are inadequately protected by the current sound worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected. • Doubtful (Rating 8) – Loans classified as Doubtful have all the weaknesses inherent in those classified Substandard with the added characteristic that the weaknesses make collection or liquidation, in full, on the basis of currently known facts, conditions and values, highly questionable and improbable. All accruing loans are reserved for as a group of similar type credits and included in the general portion of the allowance for loan losses. Loans to individuals and 1-4 family residential loans, including loans not accruing, are collectively evaluated and included in the general portion of the allowance for loan losses. All loans considered troubled debt restructurings (“TDR”) are evaluated individually for impairment. The general portion of the loan loss allowance is reflective of historical charge-off levels for similar loans adjusted for changes in current conditions and other relevant factors. These factors are likely to cause estimated losses to differ from historical loss experience and include: • Changes in lending policies or procedures, including underwriting, collection, charge-off, and recovery procedures; • Changes in local, regional and national economic and business conditions, including entry into new markets; • Changes in the volume or type of credit extended; • Changes in the experience, ability, and depth of lending management; • Changes in the volume and severity of past due, nonaccrual, restructured, or classified loans; • Changes in charge-off trends; • Changes in loan review or Board oversight; • Changes in the level of concentrations of credit; and • Changes in external factors, such as competition and legal and regulatory requirements. These factors are also considered for the purchased Omni loan portfolio specifically in regards to changes in credit quality, past due, nonaccrual and charge-off trends. The following tables detail activity in the allowance for loan losses by portfolio segment for the periods presented (in thousands): Three Months Ended June 30, 2017 Real Estate Construction 1-4 Family Residential Commercial Commercial Loans Municipal Loans Loans to Individuals Total Balance at beginning of period $ 3,407 $ 2,317 $ 8,787 $ 2,259 $ 746 $ 969 $ 18,485 Provision (reversal) for loan losses (1) 182 74 1,180 (161 ) 19 52 1,346 Loans charged off (17 ) (1 ) — (574 ) — (496 ) (1,088 ) Recoveries of loans charged off 1 2 3 100 — 392 498 Balance at end of period $ 3,573 $ 2,392 $ 9,970 $ 1,624 $ 765 $ 917 $ 19,241 Six Months Ended June 30, 2017 Real Estate Construction 1-4 Family Residential Commercial Commercial Loans Municipal Loans Loans to Individuals Total Balance at beginning of period $ 4,147 $ 2,665 $ 7,204 $ 2,263 $ 750 $ 882 $ 17,911 Provision (reversal) for loan losses (1) (540 ) 12 2,757 (273 ) 15 473 2,444 Loans charged off (35 ) (288 ) — (577 ) — (1,242 ) (2,142 ) Recoveries of loans charged off 1 3 9 211 — 804 1,028 Balance at end of period $ 3,573 $ 2,392 $ 9,970 $ 1,624 $ 765 $ 917 $ 19,241 Three Months Ended June 30, 2016 Real Estate Construction 1-4 Family Residential Commercial Commercial Loans (2) Municipal Loans Loans to Individuals Total Balance at beginning of period $ 4,577 $ 2,155 $ 4,467 $ 8,964 $ 720 $ 916 $ 21,799 Provision (reversal) for loan losses (1) (154 ) (472 ) 208 4,094 (232 ) 324 3,768 Loans charged off — — — (10,650 ) — (654 ) (11,304 ) Recoveries of loans charged off — 3 5 66 249 322 645 Balance at end of period $ 4,423 $ 1,686 $ 4,680 $ 2,474 $ 737 $ 908 $ 14,908 Six Months Ended June 30, 2016 Real Estate Construction 1-4 Family Residential Commercial Commercial Loans (2) Municipal Loans Loans to Individuals Total Balance at beginning of period $ 4,350 $ 2,595 $ 4,577 $ 6,596 $ 725 $ 893 $ 19,736 Provision (reversal) for loan losses (1) (196 ) (1,023 ) 92 6,714 (237 ) 734 6,084 Loans charged off — (19 ) — (10,923 ) — (1,502 ) (12,444 ) Recoveries of loans charged off 269 133 11 87 249 783 1,532 Balance at end of period $ 4,423 $ 1,686 $ 4,680 $ 2,474 $ 737 $ 908 $ 14,908 (1) Of the $1.3 million and $2.4 million recorded in provision for loan losses for the three and six months ended June 30, 2017 , none related to provision expense on PCI loans. Of the $3.8 million and $6.1 million recorded in provision for loan losses for the three and six months ended June 30, 2016 , approximately $1.4 million related to provision expense on PCI loans as of June 30, 2016 . (2) Of the $10.7 million and $10.9 million in commercial charge-offs recorded for the three and six months ended June 30, 2016 , $10.6 million includes the partial charge-off of two large commercial borrowing relationships. The following tables present the balance in the allowance for loan losses by portfolio segment based on impairment method (in thousands): As of June 30, 2017 Real Estate Construction 1-4 Family Residential Commercial Commercial Loans Municipal Loans Loans to Individuals Total Ending balance – individually evaluated for impairment (1) $ 5 $ 13 $ 15 $ 154 $ 11 $ 96 $ 294 Ending balance – collectively evaluated for impairment 3,568 2,379 9,955 1,470 754 821 18,947 Balance at end of period $ 3,573 $ 2,392 $ 9,970 $ 1,624 $ 765 $ 917 $ 19,241 As of December 31, 2016 Real Estate Construction 1-4 Family Residential Commercial Commercial Loans Municipal Loans Loans to Individuals Total Ending balance – individually evaluated for impairment (1) $ 13 $ 16 $ 17 $ 923 $ 11 $ 106 $ 1,086 Ending balance – collectively evaluated for impairment 4,134 2,649 7,187 1,340 739 776 16,825 Balance at end of period $ 4,147 $ 2,665 $ 7,204 $ 2,263 $ 750 $ 882 $ 17,911 (1) There was approximately $3,000 of allowance for loan losses associated with PCI loans as of June 30, 2017 and December 31, 2016 . The following tables present the recorded investment in loans by portfolio segment based on impairment method (in thousands): June 30, 2017 Real Estate Construction 1-4 Family Residential Commercial Commercial Loans Municipal Loans Loans to Individuals Total Loans individually evaluated for impairment $ 53 $ 1,651 $ 1,033 $ 983 $ 571 $ 257 $ 4,548 Loans collectively evaluated for impairment 386,663 608,219 1,030,982 170,040 304,452 96,652 2,597,008 Purchased credit impaired loans 137 5,535 1,614 1,288 — 68 8,642 Total ending loan balance $ 386,853 $ 615,405 $ 1,033,629 $ 172,311 $ 305,023 $ 96,977 $ 2,610,198 December 31, 2016 Real Estate Construction 1-4 Family Residential Commercial Commercial Loans Municipal Loans Loans to Individuals Total Loans individually evaluated for impairment $ 480 $ 1,693 $ 1,184 $ 5,840 $ 571 $ 241 $ 10,009 Loans collectively evaluated for impairment 379,526 629,893 942,818 170,159 298,012 116,923 2,537,331 Purchased credit impaired loans 169 5,653 1,976 1,266 — 133 9,197 Total ending loan balance $ 380,175 $ 637,239 $ 945,978 $ 177,265 $ 298,583 $ 117,297 $ 2,556,537 The following tables set forth credit quality indicators by class of loans for the periods presented (in thousands): June 30, 2017 Pass Pass Watch (1) Special Mention (1) Substandard (1) Doubtful (1) Total Real Estate Loans: Construction $ 385,367 $ 33 $ — $ 1,437 $ 16 $ 386,853 1-4 Family Residential 611,148 13 — 3,899 345 615,405 Commercial 943,775 10,862 28,659 50,333 — 1,033,629 Commercial Loans 163,964 1,048 3,615 3,638 46 172,311 Municipal Loans 303,522 — 930 571 — 305,023 Loans to Individuals 96,021 — 31 545 380 96,977 Total $ 2,503,797 $ 11,956 $ 33,235 $ 60,423 $ 787 $ 2,610,198 December 31, 2016 Pass Pass Watch (1) Special Mention (1) Substandard (1) Doubtful (1) Total Real Estate Loans: Construction $ 374,443 $ 34 $ 571 $ 5,108 $ 19 $ 380,175 1-4 Family Residential 632,937 68 — 3,380 854 637,239 Commercial 885,049 17,739 10,587 32,603 — 945,978 Commercial Loans 158,943 1,187 8,086 9,012 37 177,265 Municipal Loans 297,014 — 998 571 — 298,583 Loans to Individuals 115,952 — 9 629 707 117,297 Total $ 2,464,338 $ 19,028 $ 20,251 $ 51,303 $ 1,617 $ 2,556,537 (1) Includes PCI loans comprised of $5,000 pass watch, $499,000 special mention, $1.0 million substandard and $28,000 doubtful as of June 30, 2017 . Includes PCI loans comprised of $5,000 pass watch, $511,000 special mention, $1.5 million substandard and $28,000 doubtful as of December 31, 2016 . Nonperforming Assets and Past Due Loans Nonaccrual loans are loans 90 days or more delinquent and collection in full of both the principal and interest is not expected. Additionally, some loans that are not delinquent or that are delinquent less than 90 days may be placed on nonaccrual status if it is probable that we will not receive contractual principal and interest payments in accordance with the terms of the respective loan agreement. When a loan is categorized as nonaccrual, the accrual of interest is discontinued and any accrued balance is reversed for financial statement purposes. Payments received on nonaccrual loans are applied to the outstanding principal balance. Payments of contractual interest are recognized as income only to the extent that full recovery of the principal balance of the loan is reasonably certain. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured. Other factors, such as the value of collateral securing the loan and the financial condition of the borrower, are considered in judgments as to potential loan loss. Nonaccrual loans and accruing loans past due more than 90 days include both smaller balance homogeneous loans that are collectively evaluated for impairment and individually classified impaired loans. PCI loans are recorded at fair value at acquisition date. Although the PCI loans may be contractually delinquent, we do not classify these loans as past due or nonperforming as the loans were written down to fair value at the acquisition date and the accretable yield is recognized in interest income over the remaining life of the loan. However, subsequent to acquisition, we re-assess PCI loans for additional impairment and record additional impairment in the event we conclude it is probable that we will be unable to collect all cash flows originally expected to be collected at acquisition plus any additional cash flows expected to be collected due to changes in estimates after acquisition. All such PCI loans for which we recognize subsequent impairment are reported as impaired loans in the financial statements. The following table sets forth nonperforming assets for the periods presented (in thousands): At At Nonaccrual loans (1) $ 3,034 $ 8,280 Accruing loans past due more than 90 days (1) — 6 Restructured loans (2) 5,884 6,431 Other real estate owned 233 339 Repossessed assets 14 49 Total Nonperforming Assets $ 9,165 $ 15,105 (1) Excludes PCI loans measured at fair value at acquisition. (2) Includes $3.0 million and $3.1 million in PCI loans restructured as of June 30, 2017 and December 31, 2016 , respectively. Foreclosed assets include other real estate owned and repossessed assets. For 1-4 family residential real estate properties, a loan is recognized as a foreclosed property once legal title to the real estate property has been received upon completion of foreclosure or the borrower has conveyed all interest in the residential property through a deed in lieu of foreclosure. As of June 30, 2017 , there were $102,000 in loans secured by 1-4 family residential properties for which formal foreclosure proceedings were in process. As of December 31, 2016 , there were $28,000 in loans secured by 1-4 family residential properties for which formal foreclosure proceedings were in process. The following table sets forth the recorded investment in nonaccrual loans by class of loans for the periods presented (in thousands). The table ex cludes PCI loans measured at fair value at acquisition : Nonaccrual Loans June 30, 2017 December 31, 2016 Real Estate Loans: Construction $ 53 $ 105 1-4 Family Residential 1,012 1,067 Commercial 706 808 Commercial Loans 663 5,477 Loans to Individuals 600 823 Total $ 3,034 $ 8,280 Loans are considered impaired if, based on current information and events, it is probable we will be unable to collect the scheduled payments of principal and interest when due according to the contractual terms of the loan agreement. Impairment is evaluated in total for smaller-balance loans of a similar nature and on an individual loan basis for other loans. The measurement of loss on impaired loans is generally based on the fair value of the collateral less selling costs if repayment is expected solely from the collateral or the present value of the expected future cash flows discounted at the historical effective interest rate stipulated in the loan agreement. In measuring the fair value of the collateral, in addition to relying on third party appraisals, we use assumptions, such as discount rates, and methodologies, such as comparison to the recent selling price of similar assets, consistent with those that would be utilized by unrelated third parties performing a valuation. Loans that are evaluated and determined not to meet the definition of an impaired loan are reserved for at the general reserve rate for its appropriate class. At the time a loss is probable in the collection of contractual amounts, specific reserves are allocated. Loans are charged off to the liquidation value of the collateral net of liquidation costs, if any, when deemed uncollectible or as soon as collection by liquidation is evident. The following tables set forth impaired loans by class of loans for the periods presented (in thousands). Impaired loans include restructured and nonaccrual loans for which the allowance was measured in accordance with section 310-10 of ASC Topic 310, “Receivables.” There were no impaired loans recorded without an allowance as of June 30, 2017 or December 31, 2016 . June 30, 2017 Unpaid Contractual Principal Balance Recorded Investment Related Allowance for Loan Losses Real Estate Loans: Construction $ 60 $ 53 $ 5 1-4 Family Residential 4,394 4,193 13 Commercial 1,486 1,406 15 Commercial Loans 1,204 1,100 154 Municipal Loans 571 571 11 Loans to Individuals 284 257 94 Total (1) $ 7,999 $ 7,580 $ 292 December 31, 2016 Unpaid Contractual Principal Balance Recorded Investment Related Allowance for Loan Losses Real Estate Loans: Construction $ 486 $ 480 $ 13 1-4 Family Residential 4,487 4,264 16 Commercial 1,631 1,574 17 Commercial Loans 6,108 5,941 923 Municipal Loans 571 571 11 Loans to Individuals 277 241 106 Total (1) $ 13,560 $ 13,071 $ 1,086 (1) Includes $3.0 million and $3.1 million of PCI loans that experienced deterioration in credit quality subsequent to the acquisition date as of June 30, 2017 and December 31, 2016 , respectively. The following tables present the aging of the recorded investment in past due loans by class of loans (in thousands): June 30, 2017 30-59 Days Past Due 60-89 Days Past Due Greater than 90 Days Past Due Total Past Due Current (1) Total Real Estate Loans: Construction $ — $ 17 $ 21 $ 38 $ 386,815 $ 386,853 1-4 Family Residential 92 812 723 1,627 613,778 615,405 Commercial 168 — 81 249 1,033,380 1,033,629 Commercial Loans 263 80 48 391 171,920 172,311 Municipal Loans — — — — 305,023 305,023 Loans to Individuals 596 194 157 947 96,030 96,977 Total $ 1,119 $ 1,103 $ 1,030 $ 3,252 $ 2,606,946 $ 2,610,198 December 31, 2016 30-59 Days Past Due 60-89 Days Past Due Greater than 90 Days Past Due Total Past Due Current (1) Total Real Estate Loans: Construction $ 917 $ 64 $ 86 $ 1,067 $ 379,108 $ 380,175 1-4 Family Residential 6,225 755 600 7,580 629,659 637,239 Commercial 70 154 154 378 945,600 945,978 Commercial Loans 783 300 3,459 4,542 172,723 177,265 Municipal Loans 113 — — 113 298,470 298,583 Loans to Individuals 1,550 320 185 2,055 115,242 117,297 Total $ 9,658 $ 1,593 $ 4,484 $ 15,735 $ 2,540,802 $ 2,556,537 (1) Includes PCI loans measured at fair value at acquisition. The following table sets forth average recorded investment and interest income recognized on impaired loans by class of loans for the periods presented (in thousands). The table excludes PCI loans measured at fair value at acquisition that have not experienced further deterioration in credit quality subsequent to the acquisition date : Three Months Ended June 30, 2017 June 30, 2016 Average Recorded Investment Interest Income Recognized Average Recorded Investment Interest Income Recognized Real Estate Loans: Construction $ 344 $ — $ 584 $ 5 1-4 Family residential 4,476 50 2,409 43 Commercial 1,158 10 5,403 21 Commercial loans 3,050 18 18,999 120 Municipal loans 571 8 637 9 Loans to individuals 226 1 263 2 Total $ 9,825 $ 87 $ 28,295 $ 200 Six Months Ended June 30, 2017 June 30, 2016 Average Recorded Investment Interest Income Recognized Average Recorded Interest Income Recognized Real Estate Loans: Construction $ 402 $ — $ 495 $ 12 1-4 Family Residential 4,390 107 2,195 83 Commercial 1,322 25 5,294 43 Commercial Loans 4,244 36 20,158 292 Municipal Loans 571 15 637 17 Loans to Individuals 248 3 258 4 Total $ 11,177 $ 186 $ 29,037 $ 451 Troubled Debt Restructurings The restructuring of a loan is considered a TDR if both (i) the borrower is experiencing financial difficulties and (ii) the creditor has granted a concession. Concessions may include interest rate reductions or below market interest rates, restructuring amortization schedules and other actions intended to minimize potential losses. We may provide a combination of concessions which may include an extension of the amortization period, interest rate reduction, and/or converting the loan to interest-only for a limited period of time. The following tables set forth the recorded balance of loans considered to be TDRs that were restructured and the type of concession during the periods presented (dollars in thousands): Three Months Ended June 30, 2017 Extend Amortization Period Interest Rate Reductions Combination Total Modifications Number of Loans Commercial Loans $ 797 $ — $ — $ 797 2 Loans to Individuals 23 — 40 63 3 Total $ 820 $ — $ 40 $ 860 5 Six Months Ended June 30, 2017 Extend Amortization Period Interest Rate Reductions Combination Total Modifications Number of Loans Commercial Loans $ 841 $ — $ — $ 841 3 Loans to Individuals 29 — 51 80 5 Total $ 870 $ — $ 51 $ 921 8 Three Months Ended June 30, 2016 Extend Amortization Period Interest Rate Reductions Combination Total Modifications Number of Loans Real Estate Loans: Construction $ — $ — $ 24 $ 24 1 1-4 Family Residential — 77 2,743 2,820 2 Loans to Individuals 20 — 75 95 6 Total $ 20 $ 77 $ 2,842 $ 2,939 9 Six Months Ended June 30, 2016 Extend Amortization Period Interest Rate Reductions Combination Total Modifications Number of Loans Real Estate Loans: Construction $ 463 $ — $ 24 $ 487 2 1-4 Family Residential — 77 2,743 2,820 2 Other 2,088 — — 2,088 1 Commercial Loans 1,154 — — 1,154 4 Loans to Individuals 20 — 75 95 6 Total $ 3,725 $ 77 $ 2,842 $ 6,644 15 The majority of loans restructured as TDRs during the six months ended June 30, 2017 and 2016 were modified with maturity extensions. Interest continues to be charged on principal balances outstanding during the extended term. Therefore, the financial effects of the recorded investment of loans restructured as TDRs during the six months ended June 30, 2017 and 2016 were not significant. Generally, the loans identified as TDRs were previously reported as impaired loans prior to restructuring and therefore the modification did not impact our determination of the allowance for loan losses. On an ongoing basis, the performance of the TDRs is monitored for subsequent payment default. Payment default for TDRs is recognized when the borrower is 90 days or more past due. For the three and six months ended June 30, 2017 and 2016 , the amount of TDRs in default was not significant. Payment defaults for TDRs did not significantly impact the determination of the allowance for loan loss in either period presented. At June 30, 2017 and 2016 , there were no commitments to lend additional funds to borrowers whose terms had been modified in TDRs. Purchased Credit Impaired Loans The following table presents the outstanding principal balance and carrying value for PCI loans for the periods presented (in thousands): June 30, 2017 December 31, 2016 Outstanding principal balance $ 9,650 $ 10,612 Carrying amount $ 8,642 $ 9,197 The following table presents the changes in the accretable yield during the periods for PCI loans (in thousands): Three Months Ended Six Months Ended 2017 2016 2017 2016 Balance at beginning of period $ 4,003 $ 2,342 $ 2,480 $ 2,493 Reclassifications (to) from nonaccretable discount (5 ) (235 ) 1,814 208 Accretion (240 ) (509 ) (536 ) (1,103 ) Balance at end o |
Long-term Obligations
Long-term Obligations | 6 Months Ended |
Jun. 30, 2017 | |
Debt Disclosure [Abstract] | |
Long-term Obligations | Long-term Obligations Long-term obligations are summarized as follows (in thousands): June 30, December 31, Parent Company Subordinated notes: (1) 5.50% Subordinated Notes Due 2026, net of unamortized debt issuance costs (2) $ 98,171 $ 98,100 Total Subordinated notes 98,171 98,100 Long-term debt: (3) Southside Statutory Trust III Due 2033, net of unamortized debt issuance costs (4) 20,546 20,544 Southside Statutory Trust IV Due 2037 (5) 23,196 23,196 Southside Statutory Trust V Due 2037 (6) 12,887 12,887 Magnolia Trust Company I Due 2035 (7) 3,609 3,609 Total Long-term debt 60,238 60,236 Total Parent Company 158,409 158,336 Subsidiaries FHLB advances (8) 162,249 443,128 Total Subsidiaries 162,249 443,128 Total Long-term obligations $ 320,658 $ 601,464 (1) This long-term debt consists of subordinated notes with a remaining maturity greater than one year that qualify under the risk-based capital guidelines as Tier 2 capital, subject to certain limitations. (2) This debt carries a fixed rate of 5.50% through September 29, 2021 and thereafter, adjusts quarterly at a rate equal to three-month LIBOR plus 429.7 basis points . (3) This long-term debt consists of trust preferred securities that qualify under the risk-based capital guidelines as Tier 1 capital, subject to certain limitations. (4) This debt carries an adjustable rate of 4.23639% through September 29, 2017 and adjusts quarterly at a rate equal to three-month LIBOR plus 294 basis points . (5) This debt carries an adjustable rate of 2.46956% through July 29, 2017 and adjusts quarterly at a rate equal to three-month LIBOR plus 130 basis points . (6) This debt carries an adjustable rate of 3.49556% through September 14, 2017 and adjusts quarterly at a rate equal to three-month LIBOR plus 225 basis points . (7) This debt carries an adjustable rate of 2.98644% through August 22, 2017 and adjusts quarterly at a rate equal to three-month LIBOR plus 180 basis points . (8) At June 30, 2017 , the weighted average cost of these advances was 1.8% . Long-term FHLB advances have maturities ranging from July 2018 through July 2028 . On September 19, 2016 , the Company issued $100.0 million aggregate principal amount of fixed-to-floating rate subordinated notes that mature on September 30, 2026 . This debt initially bears interest at a fixed rate of 5.50% through September 29, 2021 and thereafter, adjusts quarterly at a floating rate equal to three-month LIBOR plus 429.7 basis points . The proceeds from the sale of the subordinated notes were used for general corporate purposes, which included advances to the Bank to finance its activities. The unamortized discount and debt issuance costs reflected in the carrying amount of the subordinated notes totaled approximately $1.8 million at June 30, 2017 and $1.9 million at December 31, 2016 . The unamortized debt issuance costs reflected in the carrying amount of the Southside Statutory Trust III junior subordinated debentures totaled $73,000 at June 30, 2017 and $75,000 at December 31, 2016 . From time to time, the Company may enter into various variable rate advances with the FHLB . These advances totaled $280.0 million at June 30, 2017 and $250.0 million at December 31, 2016 . Two of the variable rate advances have interest rates of three-month LIBOR minus 25 basis points. The remaining advances have interest rates ranging from one-month LIBOR plus 0.17% to one-month LIBOR plus 0.278% . In connection with obtaining these advances, the Company entered into various interest rate swap contracts that are treated as cash flow hedges under ASC Topic 815, “Derivatives and Hedging” that effectively converted the variable rate advances to fixed interest rates ranging from 0.932% to 2.345% and original terms ranging from five years to ten years. The cash flows from the swaps are expected to be effective in hedging the variability in future cash flows attributable to fluctuations in the one-month and three-month LIBOR interest rates. During the first quarter of 2017 , we terminated two interest rate swap contracts designated as cash flow hedges having a total notional value of $40.0 million . At the time of termination, we determined that the underlying hedged forecasted transactions were still probable of occurring. These transactions are reevaluated on a monthly basis thereafter, to determine if the hedged forecasted transactions are still probable of occurring. If at a subsequent evaluation, it is determined that the transactions will not occur, any related gains or losses recorded in AOCI are immediately recognized in earnings. Refer to “Note 10 - Derivative Financial Instruments and Hedging Activities” in our consolidated financial statements included in this report for a detailed description of our hedging policy and methodology related to derivative instruments. |
Employee Benefit Plans
Employee Benefit Plans | 6 Months Ended |
Jun. 30, 2017 | |
Defined Contribution Plan [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans The components of net periodic benefit cost (income) are as follows (in thousands): Three Months Ended June 30, Defined Benefit Defined Benefit Pension Plan Acquired Restoration 2017 2016 2017 2016 2017 2016 Service cost $ 341 $ 316 $ — $ — $ 73 $ 56 Interest cost 888 953 44 53 151 133 Expected return on assets (1,513 ) (1,257 ) (53 ) (66 ) — — Net loss amortization 312 462 — — 104 40 Prior service (credit) cost amortization (3 ) 7 — — 1 1 Special and contractual termination benefits — 29 — — — — Net periodic benefit cost (income) $ 25 $ 510 $ (9 ) $ (13 ) $ 329 $ 230 Six Months Ended June 30, Defined Benefit Defined Benefit Pension Plan Acquired Restoration 2017 2016 2017 2016 2017 2016 Service cost $ 699 $ 684 $ — $ — $ 124 $ 103 Interest cost 1,800 1,870 89 106 283 268 Expected return on assets (3,025 ) (2,611 ) (107 ) (133 ) — — Net loss amortization 656 820 — — 151 93 Prior service (credit) cost amortization (7 ) 1 — — 3 3 Special and contractual termination benefits — 1,549 — — — — Net periodic benefit cost (income) $ 123 $ 2,313 $ (18 ) $ (27 ) $ 561 $ 467 |
Share-based Incentive Plans
Share-based Incentive Plans | 6 Months Ended |
Jun. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-based Incentive Plans | Share-based Incentive Plans 2017 Incentive Plan On May 10, 2017, our shareholders approved the Southside Bancshares, Inc. 2017 Incentive Plan (the “2017 Incentive Plan”), which is a stock-based incentive compensation plan. A total of 2,050,000 shares of our common stock were reserved and available for issuance pursuant to awards granted under the 2017 Incentive Plan, plus a number of additional shares (not to exceed 410,000 ) underlying awards outstanding as of May 10, 2017 under the Company’s 2009 Incentive Plan that thereafter terminate or expire unexercised, or are cancelled, forfeited or lapse for any reason. Under the 2017 Incentive Plan, we are authorized to grant stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards, and qualified performance-based awards or any combination thereof to selected employees, officers, directors and consultants of the Company and its Affiliates. There have been no awards granted during the six months ended June 30, 2017 . During the six months ended June 30, 2016 , we granted 87,474 nonqualified stock options (“NQSOs”) pursuant to the 2009 Incentive Plan with an exercise price equal to the fair value of the shares at the date of grant with a weighted average exercise price of $25.97 . The NQSOs have contractual terms of 10 years and vest in equal annual installments over either a three - or four -year period. We also granted 18,315 restricted stock units (“RSUs”) during the six months ended June 30, 2016 , with a total value of $486,000 . The RSUs vest in equal annual installments over either a three - or four -year period. Historically, shares issued in connection with stock compensation awards have been issued from available authorized shares. Beginning in the second quarter of 2017, shares were issued from available treasury shares. Shares issued in connection with stock compensation awards along with other related information were as follows (in thousands, except per share amounts): Three Months Ended Six Months Ended 2017 2016 2017 2016 New shares issued from available authorized shares 14,715 18,256 48,311 23,168 New shares issued from available treasury shares 11,767 — 11,767 — Total 26,482 18,256 60,078 23,168 Proceeds from stock option exercises $ 383 $ 159 $ 1,022 $ 194 For the three and six months ended June 30, 2017 , we had share-based compensation expense of $419,000 and $913,000 , respectively. Share-based compensation expense for the three and six months ended June 30, 2016 was $403,000 and $758,000 , respectively. |
Derivative Financial Instrument
Derivative Financial Instruments and Hedging Activities | 6 Months Ended |
Jun. 30, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities Disclosure | Derivative Financial Instruments and Hedging Activities Our hedging policy allows the use of interest rate derivative instruments to manage our exposure to interest rate risk or hedge specified assets and liabilities. These instruments may include interest rate swaps and interest rate caps and floors. All derivative instruments are carried on the balance sheet at their estimated fair value and are recorded in other assets or other liabilities, as appropriate. Derivative instruments may be designated as cash flow hedges of variable rate assets or liabilities, or as cash flow hedges of forecasted transactions. Gains and losses on derivative instruments designated as cash flow hedges are recorded in accumulated other comprehensive income to the extent that they are effective. The amount recorded in other comprehensive income is reclassified to earnings in the same periods that the hedged cash flows impact earnings. The ineffective portion of changes in fair value is reported in current earnings. From time to time, we enter into certain interest rate swap contracts on specific variable-rate advance agreements with the FHLB. These interest rate swap contracts were designated as hedging instruments in cash flow hedges under ASC Topic 815. The objective of the interest rate swap contracts is to manage the expected future cash flows on $240.0 million of variable-rate advance agreements with the FHLB. The cash flows from the swap are expected to be effective in hedging the variability in future cash flows attributable to fluctuations in the underlying LIBOR interest rate. In accordance with ASC Topic 815, if a hedging item is terminated prior to maturity for a cash settlement, the existing gain or loss within accumulated other comprehensive income will continue to be reclassified into earnings during the period or periods in which the hedged forecasted transaction affects earnings unless it is probable that the forecasted transaction will not occur by the end of the originally specified time period. If the forecasted transaction is deemed probable to not occur, the derivative gain or loss reported in accumulated other comprehensive income shall be reclassified into earnings immediately. During the first quarter of 2017, we terminated two interest rate swap contracts designated as cash flow hedges. At the time of termination, we determined that the underlying hedged forecasted transactions were still probable of occurring. The existing gain in accumulated other comprehensive income will be reclassified into earnings in the same periods the hedged forecasted transaction affects earnings. At June 30, 2017 , net derivative assets included $4.8 million of cash collateral received from counterparties under master netting agreements and net derivative liabilities included $1.1 million of cash collateral held by a counterparty subject to a master netting agreement. At June 30, 2017 , we had $553,000 of cash collateral receivable that was not offset against derivative liabilities. From time to time, we may enter into certain interest rate swaps, cap, and floor contracts that are not designated as hedging instruments. These interest rate derivative contracts relate to transactions in which we enter into an interest rate swap, cap, or floor with a customer while concurrently entering into an offsetting interest rate swap, cap, or floor with a third-party financial institution. We agree to pay interest to the customer on a notional amount at a variable rate and receive interest from the customer on a similar notional amount at a fixed interest rate. At the same time, we agree to pay a third-party financial institution the same fixed interest rate on the same notional amount and receive the same variable interest rate on the same notional amount. These interest rate derivative contracts allow our customers to effectively convert a variable rate loan to a fixed rate loan. The changes in the fair value of the underlying derivative contracts primarily offset each other and do not significantly impact our results of operations. For derivative instruments not designated as hedging instruments, the gain or loss is recognized in current earnings during the period of change. We recognized swap fee income associated with these derivative contracts immediately based upon the difference in the bid/ask spread of the underlying transactions with the customer and the third-party financial institution. The swap fee income is included in other noninterest income in our consolidated statements of income. The notional amounts of the derivative instruments represent the contractual cash flows pertaining to the underlying agreements. These amounts are not exchanged and are not reflected in the consolidated balance sheets. The fair value of the interest rate swaps are presented at net in other assets and other liabilities when a right of offset exists, based on transactions with a single counterparty that are subject to a legally enforceable master netting agreement. The following tables present the notional and estimated fair value amount of derivative positions outstanding for the periods presented (in thousands): June 30, 2017 December 31, 2016 Estimated Fair Value Estimated Fair Value Notional (1) Asset Derivative Liability Derivative Notional (1) Asset Derivative Liability Derivative Derivatives designated as hedging instruments Interest rate contracts: Swaps-Cash Flow Hedge-Financial institution counterparties $ 240,000 $ 6,189 $ 344 $ 250,000 $ 7,069 $ — Derivatives designated as non-hedging instruments Interest rate contracts: Swaps-Financial institution counterparties 67,942 76 1,222 2,182 85 — Swaps-Customer counterparties 67,942 1,222 76 2,182 — 85 Gross derivatives 7,487 1,642 7,154 85 Offsetting derivative assets/liabilities (420 ) (420 ) — — Cash collateral received/posted (4,760 ) (1,146 ) (7,154 ) — Net derivatives included in the consolidated balance sheets (2) $ 2,307 $ 76 $ — $ 85 (1) Notional amounts, which represent the extent of involvement in the derivatives market, are used to determine the contractual cash flows required in accordance with the terms of the agreement. These amounts are typically not exchanged, significantly exceed amounts subject to credit or market risk, and are not reflected in the consolidated balance sheets. (2) Net derivative assets are included in “other assets” and net derivative liabilities are included in “other liabilities” on the consolidated balance sheets. Included in the fair value of net derivative assets and net derivative liabilities are credit valuation adjustments reflecting counterparty credit risk and our credit risk. We had net credit exposure of $1.6 million related to interest rate swaps with financial institutions and $1.2 million related to interest rate swaps with customers at June 30, 2017 . The credit risk associated with customer transactions is partially mitigated as these transactions are generally secured by the non-cash collateral securing the underlying transaction being hedged. We had no credit exposure related to interest rate swaps with financial or customer counterparties at December 31, 2016 . The summarized expected weighted average remaining maturity of the notional amount of interest rate swaps and the weighted average interest rates associated with the amounts expected to be received or paid on interest rate swap agreements are presented below (dollars in thousands). Variable rates received on pay fixed swaps are based on one-month or three-month LIBOR rates in effect at June 30, 2017 and December 31, 2016 : June 30, 2017 December 31, 2016 Weighted Average Weighted Average Notional Amount Remaining Maturity (in years) Receive Rate Pay Rate Notional Amount Remaining Maturity Receive Rate Pay Swaps-Cash Flow Hedge Financial institution counterparties $ 240,000 5.8 1.14 % 1.43 % $ 250,000 5.4 0.68 % 1.31 % Swaps-Non-Hedging Financial institution counterparties 67,942 13.2 1.04 2.37 2,182 9.7 0.62 1.57 Customer counterparties 67,942 13.2 2.37 1.04 2,182 9.7 1.57 0.62 |
Fair Value Measurement
Fair Value Measurement | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement | Fair Value Measurement Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. A fair value measurement assumes that the transaction to sell the asset or transfer the liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability. The price in the principal (or most advantageous) market used to measure the fair value of the asset or liability is not adjusted for transaction costs. An orderly transaction is a transaction that assumes exposure to the market for a period prior to the measurement date to allow for marketing activities that are usual and customary for transactions involving such assets and liabilities; it is not a forced transaction. Market participants are buyers and sellers in the principal market that are (i) independent, (ii) knowledgeable, (iii) able to transact and (iv) willing to transact. Valuation techniques including the market approach, the income approach and/or the cost approach are utilized to determine fair value. Inputs to valuation techniques refer to the assumptions that market participants would use in pricing the asset or liability. Valuation policies and procedures are determined by our investment department and reported to our Asset/Liability Committee (“ALCO”) for review. An entity must consider all aspects of nonperforming risk, including the entity’s own credit standing, when measuring fair value of a liability. Inputs may be observable, meaning those that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from independent sources, or unobservable, meaning those that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. A fair value hierarchy for valuation inputs gives the highest priority to quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The fair value hierarchy is as follows: Level 1 Inputs - Unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 Inputs - Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These might include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (such as interest rates, volatilities, prepayment speeds, credit risks, etc.) or inputs that are derived principally from or corroborated by market data by correlation or other means. Level 3 Inputs - Unobservable inputs for determining the fair values of assets or liabilities that reflect an entity’s own assumptions about the assumptions that market participants would use in pricing the assets or liabilities. Level 3 assets recorded at fair value on a nonrecurring basis at June 30, 2017 and December 31, 2016 , included loans for which a specific allowance was established based on the fair value of collateral and commercial real estate for which fair value of the properties was less than the cost basis. For both asset classes, the unobservable inputs were the additional adjustments applied by management to the appraised values to reflect such factors as non-current appraisals and revisions to estimated time to sell. These adjustments are determined based on qualitative judgments made by management on a case-by-case basis and are not quantifiable inputs, although they are used in the determination of fair value. A description of the valuation methodologies used for assets and liabilities measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy, is set forth below. Certain financial assets are measured at fair value in accordance with GAAP. Adjustments to the fair value of these assets usually result from the application of fair value accounting or write-downs of individual assets. Transfers between levels of the fair value hierarchy are recognized on the actual date of the event or circumstances that caused the transfer, which generally coincides with our monthly and/or quarterly valuation process. There were no transfers between Level 1 and Level 2 during the six months ended June 30, 2017 or the year ended December 31, 2016 . Securities Available for Sale – U.S. Treasury securities and other equity securities are reported at fair value utilizing Level 1 inputs. Other securities classified as available for sale are reported at fair value utilizing Level 2 inputs. For these securities, we obtain fair value measurements from independent pricing services. The fair value measurements consider observable data that may include dealer quotes, market spreads, cash flows, the U.S. Treasury yield curve, live trading levels, trade execution data, market consensus prepayment speeds, credit information and the bond’s terms and conditions, among other things. We review the prices supplied by the independent pricing services for reasonableness and to ensure such prices are aligned with traditional pricing matrices. In addition, we obtain an understanding of their underlying pricing methodologies and their Statement on Standards for Attestation Engagements-Reporting on Controls of a Service Organization (“SSAE 16”). We validate prices supplied by the independent pricing services by comparison to prices obtained from, in most cases, three additional third party sources. For securities where prices are outside a reasonable range, we further review those securities to determine what a reasonable price estimate is for that security, given available data. Derivatives – Derivatives are reported at fair value utilizing Level 2 inputs. We obtain fair value measurements from three sources including an independent pricing service and the counterparty to the derivatives designated as hedges. The fair value measurements consider observable data that may include dealer quotes, market spreads, the U.S. Treasury yield curve, live trading levels, trade execution data, credit information and the derivatives’ terms and conditions, among other things. We review the prices supplied by the sources for reasonableness. In addition, we obtain a basic understanding of their underlying pricing methodology. We validate prices supplied by the sources by comparison to one another. Certain financial assets and financial liabilities are measured at fair value on a nonrecurring basis, which means that the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment). Financial assets and financial liabilities measured at fair value on a nonrecurring basis included foreclosed assets and impaired loans at June 30, 2017 and December 31, 2016 . Foreclosed Assets – Foreclosed assets are initially recorded at fair value less costs to sell. The fair value measurements of foreclosed assets can include Level 2 measurement inputs such as real estate appraisals and comparable real estate sales information, in conjunction with Level 3 measurement inputs such as cash flow projections, qualitative adjustments, and sales cost estimates. As a result, the categorization of foreclosed assets is Level 3 of the fair value hierarchy. In connection with the measurement and initial recognition of certain foreclosed assets, we may recognize charge-offs through the allowance for loan losses. Impaired Loans – Certain impaired loans may be reported at the fair value of the underlying collateral if repayment is expected solely from the collateral. Collateral values are estimated using Level 3 inputs based on customized discounting criteria or appraisals. At June 30, 2017 and December 31, 2016 , the impact of loans with specific reserves based on the fair value of the collateral was reflected in our allowance for loan losses. Certain nonfinancial assets and nonfinancial liabilities measured at fair value on a recurring basis include reporting units measured at fair value and tested for goodwill impairment. The following tables summarize assets measured at fair value on a recurring and nonrecurring basis segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value (in thousands): As of June 30, 2017 Fair Value Measurements at the End of the Reporting Period Using Carrying Amount Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Recurring fair value measurements Investment Securities: State and Political Subdivisions $ 326,159 $ — $ 326,159 $ — Other Stocks and Bonds 5,144 — 5,144 — Other Equity Securities 5,954 5,954 — — Mortgage-backed Securities: (1) Residential 654,104 — 654,104 — Commercial 406,450 — 406,450 — Derivative assets: Interest rate swaps 7,487 — 7,487 — Total asset recurring fair value measurements $ 1,405,298 $ 5,954 $ 1,399,344 $ — Derivative liabilities: Interest rate swaps $ 1,642 $ — $ 1,642 $ — Total liability recurring fair value measurements $ 1,642 $ — $ 1,642 $ — Nonrecurring fair value measurements Foreclosed assets $ 247 $ — $ — $ 247 Impaired loans (2) 6,785 — — 6,785 Total asset nonrecurring fair value measurements $ 7,032 $ — $ — $ 7,032 As of December 31, 2016 Fair Value Measurements at the End of the Reporting Period Using Carrying Amount Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Recurring fair value measurements Investment Securities: U.S. Treasury $ 70,069 $ 70,069 $ — $ — State and Political Subdivisions 385,197 — 385,197 — Other Stocks and Bonds 6,651 — 6,651 — Other Equity Securities 5,920 5,920 — — Mortgage-backed Securities: (1) Residential 627,508 — 627,508 — Commercial 384,255 — 384,255 — Derivative assets: Interest rate swaps 7,154 — 7,154 — Total asset recurring fair value measurements $ 1,486,754 $ 75,989 $ 1,410,765 $ — Derivative liabilities: Interest rate swaps $ 85 $ — $ 85 $ — Total liability recurring fair value measurements $ 85 $ — $ 85 $ — Nonrecurring fair value measurements Foreclosed assets $ 388 $ — $ — $ 388 Impaired loans (2) 9,693 — — 9,693 Total asset nonrecurring fair value measurements $ 10,081 $ — $ — $ 10,081 (1) All mortgage-backed securities are issued and/or guaranteed by U.S. government agencies or U.S. government-sponsored enterprises. (2) Impaired loans represent collateral-dependent loans with a specific valuation allowance. Losses on these loans represent charge-offs which are netted against the allowance for loan losses. Disclosure of fair value information about financial instruments, whether or not recognized in the balance sheet, is required when it is practicable to estimate that value. In cases where quoted market prices are not available, fair values are based on estimates using present value or other estimation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. Such techniques and assumptions, as they apply to individual categories of our financial instruments, are as follows: Cash and cash equivalents - The carrying amount for cash and cash equivalents is a reasonable estimate of those assets’ fair value. Investment and mortgage - backed securities held to maturity - Fair values for these securities are based on quoted market prices, where available. If quoted market prices are not available, fair values are based on quoted market prices for similar securities or estimates from independent pricing services. FHLB stock and other investments - The carrying amount of FHLB stock and other investments is a reasonable estimate of the fair value of those assets. Loans receivable - For adjustable rate loans that reprice frequently and with no significant change in credit risk, the carrying amounts are a reasonable estimate of those assets’ fair value. The fair value of fixed rate loans is estimated by discounting the future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities. Nonperforming loans are estimated using discounted cash flow analyses or the underlying value of the collateral where applicable. Loans held for sale – The fair value of loans held for sale is determined based on expected proceeds, which are based on sales contracts and commitments. Deposit liabilities - The fair value of demand deposits, savings accounts, and certain money market deposits is the amount on demand at the reporting date, which is the carrying value. Fair values for fixed rate CDs are estimated using a discounted cash flow calculation that applies interest rates currently being offered for deposits of similar remaining maturities. Federal funds purchased and repurchase agreements - Federal funds purchased generally have original terms to maturity of one day and repurchase agreements generally have terms of less than one year, and therefore both are considered short-term borrowings. Consequently, their carrying value is a reasonable estimate of fair value. FHLB advances - The fair value of these advances is estimated by discounting the future cash flows using rates at which advances would be made to borrowers with similar credit ratings and for the same remaining maturities. Subordinated notes - The fair value of the subordinated notes is estimated by discounting future cash flows using estimated rates at which long-term debt would be made to borrowers with similar credit ratings and for the remaining maturities. Long-term debt - The fair value of the long-term debt is estimated by discounting future cash flows using estimated rates at which long-term debt would be made to borrowers with similar credit ratings and for the remaining maturities. The following tables present our financial assets, financial liabilities, and unrecognized financial instruments measured on a nonrecurring basis at both their respective carrying amounts and estimated fair value (in thousands): Estimated Fair Value June 30, 2017 Carrying Total Level 1 Level 2 Level 3 Financial Assets: Cash and cash equivalents $ 235,832 $ 235,832 $ 235,832 $ — $ — Investment Securities: Held to maturity, at carrying value 419,825 430,155 — 430,155 — Mortgage-backed Securities: Held to maturity, at carrying value 505,713 513,621 — 513,621 — FHLB stock, at cost, and other investments 66,985 66,985 — 66,985 — Loans, net of allowance for loan losses 2,590,957 2,603,697 — — 2,603,697 Loans held for sale 3,036 3,036 — 3,036 — Financial Liabilities: Deposits $ 3,624,073 $ 3,620,875 $ — $ 3,620,875 $ — Federal funds purchased and repurchase agreements 8,424 8,424 — 8,424 — FHLB advances 1,178,082 1,172,459 — 1,172,459 — Subordinated notes, net of unamortized debt issuance costs 98,171 102,771 — 102,771 — Long-term debt , net of unamortized debt issuance costs 60,238 47,897 — 47,897 — Estimated Fair Value December 31, 2016 Carrying Total Level 1 Level 2 Level 3 Financial Assets: Cash and cash equivalents $ 169,654 $ 169,654 $ 169,654 $ — $ — Investment Securities: Held to maturity, at carrying value 425,810 429,912 — 429,912 — Mortgage-backed Securities: Held to maturity, at carrying value 511,677 514,370 — 514,370 — FHLB stock, at cost, and other investments 66,592 66,592 — 66,592 — Loans, net of allowance for loan losses 2,538,626 2,630,009 — — 2,630,009 Loans held for sale 7,641 7,641 — 7,641 — Financial Liabilities: Deposits $ 3,533,076 $ 3,293,352 $ — $ 3,293,352 $ — Federal funds purchased and repurchase agreements 7,097 7,097 — 7,097 — FHLB advances 1,309,646 1,331,517 — 1,331,517 — Subordinated notes, net of unamortized debt issuance costs 98,100 101,627 — 101,627 — Long-term debt , net of unamortized debt issuance costs 60,236 45,147 — 45,147 — The fair value estimate of financial instruments for which quoted market prices are unavailable is dependent upon the assumptions used. Consequently, those estimates cannot be substantiated by comparison to independent markets and, in many cases, could not be realized in immediate settlement of the instruments. Accordingly, the aggregate fair value amounts presented in the above fair value table do not necessarily represent their underlying value. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The income tax expense included in the accompanying statements of income consists of the following (in thousands): Three Months Ended Six Months Ended 2017 2016 2017 2016 Current income tax expense $ 3,317 $ 1,454 $ 6,344 $ 5,239 Deferred income tax (benefit) expense 36 1,318 17 506 Income tax expense $ 3,353 $ 2,772 $ 6,361 $ 5,745 Net deferred tax assets totaled $22.4 million at June 30, 2017 and $28.9 million at December 31, 2016 . No valuation allowance for deferred tax assets was recorded at June 30, 2017 or December 31, 2016 , as management believes it is more likely than not that all of the deferred tax assets will be realized in future years. Unrecognized tax benefits were not material at June 30, 2017 or December 31, 2016 . During the first quarter of 2017, we adopted a new accounting standard that impacted how the income tax effects associated with stock-based compensation are recognized. See “Note 1 - Summary of Significant Accounting and Reporting Policies” for additional information. We recognized income tax expense of $3.4 million and $6.4 million , for an effective tax rate (“ETR”) of 18.8% and 17.8% for the three and six months ended June 30, 2017 , respectively, compared to income tax expense of $2.8 million and $5.7 million , for an ETR of 19.6% and 18.7% , for the three and six months ended June 30, 2016 , respectively. The lower ETR for the three and six months ended June 30, 2017 was mainly due to the adoption of the accounting standard mentioned above, reducing income tax expense by $84,000 and $210,000 and the ETR by 0.5% and 0.6% , respectively. The ETR differs from the stated rate of 35% during the comparable period primarily due to the effect of tax-exempt income from municipal loans and securities, as well as bank owned life insurance. We file federal income tax returns and certain state tax returns. We are no longer subject to U.S. federal income tax examinations by tax authorities for years before 2013 . |
Off-Balance-Sheet Arrangements,
Off-Balance-Sheet Arrangements, Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Off-Balance-Sheet Arrangements, Commitments and Contingencies | Off-Balance-Sheet Arrangements, Commitments and Contingencies Financial Instruments with Off-Balance-Sheet Risk . In the normal course of business, we are a party to certain financial instruments with off-balance-sheet risk to meet the financing needs of our customers. These off-balance-sheet instruments include commitments to extend credit and standby letters of credit. These instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount reflected in the financial statements. The contract or notional amounts of these instruments reflect the extent of involvement and exposure to credit loss that we have in these particular classes of financial instruments. Commitments to extend credit are agreements to lend to a customer provided that the terms established in the contract are met. Commitments generally have fixed expiration dates and may require the payment of fees. Since some commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. Standby letters of credit are conditional commitments issued to guarantee the performance of a customer to a third party. These guarantees are primarily issued to support public and private borrowing arrangements. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan commitments to customers and similarly do not necessarily represent future cash obligations. Financial instruments with off-balance-sheet risk were as follows (in thousands): At At Unused commitments: Commitments to extend credit $ 693,485 $ 665,663 Standby letters of credit 9,818 9,075 Total $ 703,303 $ 674,738 We apply the same credit policies in making commitments and standby letters of credit as we do for on-balance-sheet instruments. We evaluate each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary, upon extension of credit is based on management’s credit evaluation of the borrower. Collateral held varies but may include cash or cash equivalents, negotiable instruments, real estate, accounts receivable, inventory, oil, gas and mineral interests, property, plant, and equipment. Lease Commitments . We lease certain branch facilities and office equipment under operating leases. It is expected that certain leases will be renewed, or equipment replaced with new leased equipment, as these leases expire. Securities . In the normal course of business we buy and sell securities. There were $24.9 million and $160,000 of unsettled trades to purchase securities at June 30, 2017 and December 31, 2016 , respectively. There were no unsettled trades to sell securities as of June 30, 2017 or December 31, 2016 . Deposits . There were no unsettled issuances of brokered CDs at June 30, 2017 or December 31, 2016 . Litigation . We are a party to various litigation in the normal course of business. Management, after consulting with our legal counsel, believes that any liability resulting from litigation will not have a material effect on our financial position, results of operations or liquidity. |
Summary of Significant Accoun23
Summary of Significant Accounting and Reporting Policies (Policies) | 6 Months Ended |
Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation In this report, the words “the Company,” “we,” “us,” and “our” refer to the combined entities of Southside Bancshares, Inc. and its subsidiaries. The words “Southside” and “Southside Bancshares” refer to Southside Bancshares, Inc. The words “Southside Bank” and “the Bank” refer to Southside Bank. “Omni” refers to OmniAmerican Bancorp, Inc., a bank holding company acquired by Southside on December 17, 2014. The consolidated balance sheet as of June 30, 2017 , and the related consolidated statements of income, comprehensive income, changes in shareholders’ equity, cash flows and notes to the financial statements for the three- and six- month periods ended June 30, 2017 and 2016 are unaudited; in the opinion of management, all adjustments necessary for a fair presentation of such financial statements have been included. Such adjustments consisted only of normal recurring items. All intercompany accounts and transactions are eliminated in consolidation. The preparation of these consolidated financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires the use of management’s estimates. These estimates are subjective in nature and involve matters of judgment. Actual amounts could differ from these estimates. On May 4, 2017, our board of directors declared a 2.5% stock dividend to common stock shareholders of record as of May 30, 2017, which was paid on June 27, 2017. All share data has been adjusted to give retroactive recognition to stock dividends. Interim results are not necessarily indicative of results for a full year. These financial statements should be read in conjunction with the financial statements and notes thereto in our Annual Report on Form 10-K for the year ended December 31, 2016 . Accounting Changes and Reclassifications Certain prior period amounts have been reclassified to conform to current year presentation. We adopted ASU 2016-09 “Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting,” on January 1, 2017 which requires all income tax effects related to settlements of share-based payment awards be reported in earnings as an increase (or decrease) to income tax expense. Previously, income tax benefits at settlement of an award were reported as an increase (or decrease) to additional paid-in capital to the extent that those benefits were greater than (or less than) the income tax benefits recognized in earnings during the vesting period or exercise of the award. The requirement to report those income tax effects in earnings has been applied to settlements occurring on or after January 1, 2017, and the impact of applying that guidance reduced reported income tax expense by $84,000 , or less than $0.01 on our diluted earnings per common share for the three months ended June 30, 2017 , and $210,000 , or $0.01 on our diluted earnings per common share for the six months ended June 30, 2017 . ASU 2016-09 also requires that all income tax-related cash flows resulting from share-based payments be reported as operating activities in the statement of cash flows. Previously, income tax benefits at settlement of an award were reported as a reduction to operating cash flows and an increase to financing cash flows to the extent that those benefits exceeded the income tax benefits reported in earnings during the vesting period or exercise of the award. We have elected to apply that change in cash flow on a prospective basis and therefore, prior periods have not been adjusted. ASU 2016-09 also requires the classification of employee taxes paid when an employer withholds shares for tax withholding purposes be classified as a financing activity in the statement of cash flow and be applied retrospectively. The requirement to report the employee taxes paid is reflected in prior period presentation in our consolidated statement of cash flows. In connection with the adoption of ASU 2016-09, we have also elected to recognize forfeitures as they occur. |
Terminated Derivative Financial Instruments | Terminated Derivative Financial Instruments In accordance with ASC Topic 815, if a hedging item is terminated prior to maturity for a cash settlement, the existing gain or loss within accumulated other comprehensive income (AOCI) will continue to be reclassified into earnings during the period or periods in which the hedged forecasted transaction affects earnings unless it is probable that the forecasted transaction will not occur by the end of the originally specified time period. If the forecasted transaction is deemed probable to not occur, the derivative gain or loss reported in accumulated other comprehensive income shall be reclassified into earnings immediately. During the first quarter of 2017, we terminated two interest rate swap contracts designated as cash flow hedges of forecasted transactions. At the time of termination, we determined that the underlying hedged forecasted transactions were still probable of occurring. These transactions are reevaluated on a monthly basis thereafter, to determine if the hedged forecasted transactions are still probable of occurring. If at a subsequent evaluation, it is determined that the transactions will not occur, any related gains or losses recorded in AOCI are immediately recognized in earnings. The existing gain in accumulated other comprehensive income related to the terminated interest rate swap contracts will be reclassified into earnings through straight-line accretion in the same periods the hedged forecasted transaction affects earnings. Further information on our derivative instruments and hedging activities is included in “Note 10 - Derivative Financial Instruments and Hedging Activities.” |
Accounting Pronouncements | Accounting Pronouncements In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606).” This update states 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. This update affects entities that enter into contracts with customers to transfer goods or services or enter into contracts for the transfer of nonfinancial assets, unless those contracts are within the scope of other standards. In August 2015, the FASB issued ASU 2015-14, “Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date,” which defers the effective date of the previously issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) until the interim and annual reporting periods beginning after December 15, 2017. Early adoption is permitted. The guidance permits companies to either apply the requirements retrospectively to all prior periods presented, or apply the requirements in the year of adoption, through cumulative adjustment. We anticipate adopting the new standard using the modified retrospective method beginning January 1, 2018. Our revenue consists of net interest income on financial assets and financial liabilities, which is explicitly excluded from the scope of ASU 2014-09, and noninterest income. We have evaluated the impact this guidance will have in relation to our noninterest income derived from contracts with our customers as it relates to deposit services, trust income, brokerage services, and merchant services (included in other noninterest income) which we have determined to be in the scope of ASU 2014-09. The adoption of ASU 2014-09 is not expected to have a material impact on our financials. We are continuing to evaluate the impact of the additional disclosures required by this guidance. In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” ASU 2016-02 requires a lessee to recognize assets and liabilities for leases with lease terms of more than 12 months. Consistent with current GAAP, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a finance or operating lease. However, unlike current GAAP which requires only capital leases to be recognized on the balance sheet, the new ASU 2016-02 will require both finance (formerly known as “capital”) and operating leases to be recognized on the balance sheet. ASU 2016-02 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted. The guidance requires companies to apply the requirements in the year of adoption using a modified retrospective approach. We are currently evaluating the impact this guidance will have on our financial statements and we anticipate our assessment to be completed during the fiscal year 2018. In June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments. ASU 2016-13 also modifies the impairment model for available for sale debt securities and provides for a simplified accounting model for purchased financial assets with credit deterioration since their origination. ASU 2016-13 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The guidance requires companies to apply the requirements in the year of adoption through cumulative adjustment with some aspects of the update requiring a prospective transition approach. We are currently evaluating the potential impact of the pending adoption of ASU 2016-13 on our consolidated financial statements. In January 2017, the FASB issued ASU 2017-04, “Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment.” ASU 2017-04 is intended to simplify goodwill impairment testing by eliminating the second step of the analysis which requires the calculation of the implied fair value of goodwill to measure a goodwill impairment charge. The update requires entities to compare the fair value of a reporting unit with its carrying amount and recognize an impairment charge for any amount by which the carrying amount exceeds the reporting unit’s fair value, to the extent that the loss recognized does not exceed the amount of goodwill allocated to that reporting unit. ASU 2017-04 is effective for annual and interim goodwill impairment tests performed in periods beginning after December 15, 2019. Early adoption is permitted for annual and interim goodwill impairment testing dates after January 1, 2017. The guidance requires companies to apply the requirements prospectively in the year of adoption. ASU 2017-04 is not expected to have a significant impact on our consolidated financial statements. In March 2017, the FASB issued ASU 2017-07, “Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost.” ASU 2017-07 requires employers to present the service cost component of net periodic benefit cost in the same income statement line item as other employee compensation costs arising from services rendered during the period. Only the service cost component will be eligible for capitalization in assets. Employers are required to present the other components of the net periodic benefit cost separately from the line item that includes the service cost and outside of any subtotal of operating income, if one is presented. ASU 2017-07 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. Early adoption is permitted as of the beginning of an annual period for which financial statements (interim or annual) have not been issued or made available for issuance. We did not early adopt ASU 2017-04. The guidance requires companies to apply the requirements retrospectively to all prior periods presented. We are currently evaluating the potential impact of the pending adoption of ASU 2017-07 on our 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.” Under current GAAP, premiums on callable debt securities are generally amortized over the contractual life of the security. ASU 2017-08 requires the premium on callable debt securities to be amortized to the earliest call date. If the debt security is not called at the earliest call date, the holder of the debt security would be required to reset the effective yield on the debt security based on the payment terms required by the debt security. ASU 2017-08 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted. The guidance requires companies to apply the requirements on a modified retrospective basis through a cumulative adjustment directly to retained earnings as of the beginning of the period of adoption. We are currently evaluating the potential impact of the pending adoption of ASU 2017-08 on our consolidated financial statements. In May 2017, the FASB issued ASU 2017-09, “Compensation - Stock Compensation (Subtopic 718): Scope of Modification Accounting.” ASU 2017-09 clarifies when changes to terms or conditions of a share-based payment award must be accounted for as a modification. Under the new guidance, an entity will not apply modification accounting to a share-based payment award if all of the following are the same immediately before and after the change: (i) the fair value of the award, (ii) the vesting conditions of the award, and (iii) the classification of the award as either an equity or liability instrument. ASU 2017-09 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. Early adoption is permitted. The guidance requires companies to apply the requirements prospectively to awards modified on or after the adoption date. ASU 2017-09 is not expected to have a significant impact on our consolidated financial statements. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Earnings Per Share [Abstract] | |
Earnings per share on a basic and diluted basis | Earnings per share on a basic and diluted basis has been adjusted to give retroactive recognition to stock dividends and is calculated as follows (in thousands, except per share amounts): Three Months Ended Six Months Ended 2017 2016 2017 2016 Basic and Diluted Earnings: Net income $ 14,481 $ 11,395 $ 29,470 $ 24,911 Basic weighted-average shares outstanding 29,318 26,890 29,303 27,002 Add: Stock awards 201 123 208 97 Diluted weighted-average shares outstanding 29,519 27,013 29,511 27,099 Basic Earnings Per Share: Net Income $ 0.49 $ 0.42 $ 1.01 $ 0.92 Diluted Earnings Per Share: Net Income $ 0.49 $ 0.42 $ 1.00 $ 0.92 |
Accumulated Other Comprehensi25
Accumulated Other Comprehensive Income (Loss) (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of accumulated other comprehensive income (loss) by component | The changes in accumulated other comprehensive income (loss) by component are as follows (in thousands): Three Months Ended June 30, 2017 Pension Plans Unrealized Gains (Losses) on Securities Unrealized Gains (Losses) on Derivatives Net Prior Service (Cost) Credit Net Gain (Loss) Total Beginning balance, net of tax $ (20,425 ) $ 4,961 $ (134 ) $ (18,993 ) $ (34,591 ) Other comprehensive income (loss): Other comprehensive income (loss) before reclassifications 13,221 (1,768 ) — — 11,453 Reclassified from accumulated other comprehensive income (loss) 288 223 (2 ) 416 925 Income tax (expense) benefit (4,728 ) 541 — (145 ) (4,332 ) Net current-period other comprehensive income (loss), net of tax 8,781 (1,004 ) (2 ) 271 8,046 Ending balance, net of tax $ (11,644 ) $ 3,957 $ (136 ) $ (18,722 ) $ (26,545 ) Six Months Ended June 30, 2017 Pension Plans Unrealized Gains (Losses) on Securities Unrealized Gains (Losses) on Derivatives Net Prior Net Gain (Loss) Total Beginning balance, net of tax $ (23,708 ) $ 4,595 $ (133 ) $ (19,247 ) $ (38,493 ) Other comprehensive income (loss): Other comprehensive income (loss) before reclassifications 18,106 (1,575 ) — — 16,531 Reclassified from accumulated other comprehensive income (loss) 454 593 (4 ) 807 1,850 Income tax (expense) benefit (6,496 ) 344 1 (282 ) (6,433 ) Net current-period other comprehensive income (loss), net of tax 12,064 (638 ) (3 ) 525 11,948 Ending balance, net of tax $ (11,644 ) $ 3,957 $ (136 ) $ (18,722 ) $ (26,545 ) Three Months Ended June 30, 2016 Pension Plans Unrealized Gains (Losses) on Securities Unrealized Gains (Losses) on Derivatives Net Prior Service (Cost) Credit Net Gain (Loss) Total Beginning balance, net of tax $ 16,245 $ (1,459 ) $ (47 ) $ (18,132 ) $ (3,393 ) Other comprehensive income (loss): Other comprehensive income (loss) before reclassifications 16,247 (3,594 ) — — 12,653 Reclassified from accumulated other comprehensive income (loss) (641 ) 460 8 502 329 Income tax (expense) benefit (5,462 ) 1,097 (3 ) (176 ) (4,544 ) Net current-period other comprehensive income (loss), net of tax 10,144 (2,037 ) 5 326 8,438 Ending balance, net of tax $ 26,389 $ (3,496 ) $ (42 ) $ (17,806 ) $ 5,045 Six Months Ended June 30, 2016 Pension Plans Unrealized Gains (Losses) on Securities Unrealized Gains (Losses) on Derivatives Net Prior Service (Cost) Credit Net Gain (Loss) Total Beginning balance, net of tax $ (239 ) $ — $ (44 ) $ (18,400 ) $ (18,683 ) Other comprehensive income (loss): Other comprehensive income (loss) before reclassifications 43,991 (6,195 ) — — 37,796 Reclassified from accumulated other comprehensive income (loss) (3,025 ) 817 4 913 (1,291 ) Income tax (expense) benefit (14,338 ) 1,882 (2 ) (319 ) (12,777 ) Net current-period other comprehensive income (loss), net of tax 26,628 (3,496 ) 2 594 23,728 Ending balance, net of tax $ 26,389 $ (3,496 ) $ (42 ) $ (17,806 ) $ 5,045 |
Reclassifications out of accumulated other comprehensive income | The reclassifications out of accumulated other comprehensive income (loss) into net income are presented below (in thousands): Three Months Ended Six Months Ended 2017 2016 2017 2016 Unrealized losses on securities transferred to held to maturity: Amortization of unrealized losses (1) $ (213 ) $ (87 ) $ (701 ) $ (144 ) Tax benefit 75 30 245 50 Net of tax $ (138 ) $ (57 ) $ (456 ) $ (94 ) Unrealized gains and losses on available for sale securities: Realized net (loss) gain on sale of securities (2) $ (75 ) $ 728 $ 247 $ 3,169 Tax benefit (expense) 26 (255 ) (86 ) (1,109 ) Net of tax $ (49 ) $ 473 $ 161 $ 2,060 Derivatives: Realized net loss on interest rate swap derivatives (3) $ (245 ) $ (460 ) $ (624 ) $ (817 ) Tax benefit 86 161 218 286 Net of tax $ (159 ) $ (299 ) $ (406 ) $ (531 ) Amortization of unrealized gains on terminated interest rate swap derivatives (3) $ 22 $ — $ 31 $ — Tax expense (8 ) — (11 ) — Net of tax $ 14 $ — $ 20 $ — Amortization of pension plan: Net actuarial loss (4) $ (416 ) $ (502 ) $ (807 ) $ (913 ) Prior service credit (cost) (4) 2 (8 ) 4 (4 ) Total before tax (414 ) (510 ) (803 ) (917 ) Tax benefit 145 179 281 321 Net of tax (269 ) (331 ) (522 ) (596 ) Total reclassifications for the period, net of tax $ (601 ) $ (214 ) $ (1,203 ) $ 839 (1) Included in interest income on the consolidated statements of income. (2) Listed as net (loss) gain on sale of securities available for sale on the consolidated statements of income. (3) Included in interest expense for long-term obligations on the consolidated statements of income. (4) These accumulated other comprehensive income components are included in the computation of net periodic pension cost (income) presented in “Note 8 - Employee Benefit Plans.” |
Securities (Tables)
Securities (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
Amortized cost and estimated fair value of investment and mortgage-backed securities | The amortized cost, gross unrealized gains and losses, carrying value, and estimated fair value of investment and mortgage-backed securities available for sale and held to maturity as of June 30, 2017 and December 31, 2016 are reflected in the tables below (in thousands): June 30, 2017 Recognized in OCI Not recognized in OCI Amortized Gross Unrealized Gross Unrealized Carrying Gross Gross Unrealized Estimated AVAILABLE FOR SALE Cost Gains Losses Value Gains Losses Fair Value Investment Securities: State and Political Subdivisions $ 330,155 $ 3,047 $ 7,043 $ 326,159 $ — $ — $ 326,159 Other Stocks and Bonds 5,059 85 — 5,144 — — 5,144 Other Equity Securities 6,034 — 80 5,954 — — 5,954 Mortgage-backed Securities: (1) Residential 651,291 7,376 4,563 654,104 — — 654,104 Commercial 405,217 2,467 1,234 406,450 — — 406,450 Total $ 1,397,756 $ 12,975 $ 12,920 $ 1,397,811 $ — $ — $ 1,397,811 HELD TO MATURITY Investment Securities: State and Political Subdivisions $ 429,146 $ 3,196 $ 12,517 $ 419,825 $ 12,529 $ 2,199 $ 430,155 Mortgage-backed Securities: (1) Residential 135,110 — 5,328 129,782 2,587 249 132,120 Commercial 379,250 983 4,302 375,931 6,364 794 381,501 Total $ 943,506 $ 4,179 $ 22,147 $ 925,538 $ 21,480 $ 3,242 $ 943,776 December 31, 2016 Recognized in OCI Not recognized in OCI Amortized Gross Unrealized Gross Unrealized Carrying Gross Gross Unrealized Estimated AVAILABLE FOR SALE Cost Gains Losses Value Gains Losses Fair Value Investment Securities: U.S. Treasury $ 74,016 $ — $ 3,947 $ 70,069 $ — $ — $ 70,069 State and Political Subdivisions 394,050 3,217 12,070 385,197 — — 385,197 Other Stocks and Bonds 6,587 64 — 6,651 — — 6,651 Other Equity Securities 6,039 — 119 5,920 — — 5,920 Mortgage-backed Securities: (1) Residential 630,603 6,434 9,529 627,508 — — 627,508 Commercial 386,109 1,201 3,055 384,255 — — 384,255 Total $ 1,497,404 $ 10,916 $ 28,720 $ 1,479,600 $ — $ — $ 1,479,600 HELD TO MATURITY Investment Securities: State and Political Subdivisions $ 435,080 $ 3,987 $ 13,257 $ 425,810 $ 7,595 $ 3,493 $ 429,912 Mortgage-backed Securities: (1) Residential 142,060 — 5,748 136,312 1,534 950 136,896 Commercial 379,016 1,067 4,718 375,365 4,372 2,263 377,474 Total $ 956,156 $ 5,054 $ 23,723 $ 937,487 $ 13,501 $ 6,706 $ 944,282 (1) All mortgage-backed securities issued and/or guaranteed by U.S. government agencies or U.S. government-sponsored enterprises. |
Unrealized loss on securities | The following tables represent the estimated fair value and unrealized loss on securities AFS and HTM as of June 30, 2017 and December 31, 2016 (in thousands): As of June 30, 2017 Less Than 12 Months More Than 12 Months Total Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss AVAILABLE FOR SALE Investment Securities: State and Political Subdivisions $ 211,790 $ 6,653 $ 8,285 $ 390 $ 220,075 $ 7,043 Other Equity Securities 5,954 80 — — 5,954 80 Mortgage-backed Securities: Residential 232,169 3,391 22,832 1,172 255,001 4,563 Commercial 98,096 1,234 — — 98,096 1,234 Total $ 548,009 $ 11,358 $ 31,117 $ 1,562 $ 579,126 $ 12,920 HELD TO MATURITY Investment Securities: State and Political Subdivisions $ 59,673 $ 706 $ 32,490 $ 1,493 $ 92,163 $ 2,199 Mortgage-backed Securities: Residential 18,607 249 — — 18,607 249 Commercial 49,291 794 — — 49,291 794 Total $ 127,571 $ 1,749 $ 32,490 $ 1,493 $ 160,061 $ 3,242 As of December 31, 2016 Less Than 12 Months More Than 12 Months Total Fair Value Unrealized Fair Value Unrealized Fair Value Unrealized AVAILABLE FOR SALE Investment Securities: U.S. Treasury $ 70,069 $ 3,947 $ — $ — $ 70,069 $ 3,947 State and Political Subdivisions 264,485 12,069 887 1 265,372 12,070 Other Equity Securities 5,920 119 — — 5,920 119 Mortgage-backed Securities: Residential 369,903 9,491 6,199 38 376,102 9,529 Commercial 245,422 3,055 — — 245,422 3,055 Total $ 955,799 $ 28,681 $ 7,086 $ 39 $ 962,885 $ 28,720 HELD TO MATURITY Investment Securities: State and Political Subdivisions $ 179,939 $ 2,190 $ 29,427 $ 1,303 $ 209,366 $ 3,493 Mortgage-backed Securities: Residential 107,024 950 — — 107,024 950 Commercial 186,854 2,263 — — 186,854 2,263 Total $ 473,817 $ 5,403 $ 29,427 $ 1,303 $ 503,244 $ 6,706 |
Interest income recognized on securities | nterest income recognized on securities for the periods presented (in thousands): Three Months Ended 2017 2016 U.S. Treasury $ 204 $ 21 State and Political Subdivisions 6,157 5,137 Other Stocks and Bonds 35 57 Other Equity Securities 28 29 Mortgage-backed Securities 10,818 9,366 Total interest income on securities $ 17,242 $ 14,610 Six Months Ended 2017 2016 U.S. Treasury $ 519 $ 148 State and Political Subdivisions 12,711 10,492 Other Stocks and Bonds 69 115 Other Equity Securities 56 58 Mortgage-backed Securities 20,863 18,757 Total interest income on securities $ 34,218 $ 29,570 |
Amortized cost, carrying value and fair value of securities presented by contractual maturity | The amortized cost, carrying value and estimated fair value of AFS and HTM securities at June 30, 2017 , are presented below by contractual maturity (in thousands). Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations. MBS are presented in total by category due to the fact that MBS typically are issued with stated principal amounts, and the securities are backed by pools of mortgages that have loans with varying maturities. The characteristics of the underlying pool of mortgages, such as fixed-rate or adjustable-rate, as well as prepayment risk, are passed on to the security holder. The term of a mortgage-backed pass-through security thus approximates the term of the underlying mortgages and can vary significantly due to prepayments. June 30, 2017 Amortized Cost Fair Value AVAILABLE FOR SALE Investment Securities: Due in one year or less $ 8,090 $ 8,220 Due after one year through five years 20,046 20,797 Due after five years through ten years 31,112 31,582 Due after ten years 275,966 270,704 335,214 331,303 Mortgage-backed Securities and Other Equity Securities: 1,062,542 1,066,508 Total $ 1,397,756 $ 1,397,811 June 30, 2017 Carrying Value Fair Value HELD TO MATURITY Investment Securities: Due in one year or less $ 22,130 $ 21,569 Due after one year through five years 41,941 42,155 Due after five years through ten years 106,435 108,483 Due after ten years 249,319 257,948 419,825 430,155 Mortgage-backed Securities: 505,713 513,621 Total $ 925,538 $ 943,776 |
Loans and Allowance for Proba27
Loans and Allowance for Probable Loan Losses (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Receivables [Abstract] | |
Classification of loans in the consolidated balance sheets | Loans in the accompanying consolidated balance sheets are classified as follows (in thousands): June 30, 2017 December 31, 2016 Real Estate Loans: Construction $ 386,853 $ 380,175 1-4 Family Residential 615,405 637,239 Commercial 1,033,629 945,978 Commercial Loans 172,311 177,265 Municipal Loans 305,023 298,583 Loans to Individuals 96,977 117,297 Total Loans (1) 2,610,198 2,556,537 Less: Allowance for Loan Losses (2) 19,241 17,911 Net Loans $ 2,590,957 $ 2,538,626 (1) Includes approximately $295.6 million and $372.4 million of loans acquired with the Omni acquisition as of June 30, 2017 and December 31, 2016 , respectively. (2) The allowance for loan loss recorded on purchase credit impaired (“PCI”) loans totaled $3,000 as of June 30, 2017 and December 31, 2016 . |
Activity in the allowance for loan losses by portfolio segment | The following tables detail activity in the allowance for loan losses by portfolio segment for the periods presented (in thousands): Three Months Ended June 30, 2017 Real Estate Construction 1-4 Family Residential Commercial Commercial Loans Municipal Loans Loans to Individuals Total Balance at beginning of period $ 3,407 $ 2,317 $ 8,787 $ 2,259 $ 746 $ 969 $ 18,485 Provision (reversal) for loan losses (1) 182 74 1,180 (161 ) 19 52 1,346 Loans charged off (17 ) (1 ) — (574 ) — (496 ) (1,088 ) Recoveries of loans charged off 1 2 3 100 — 392 498 Balance at end of period $ 3,573 $ 2,392 $ 9,970 $ 1,624 $ 765 $ 917 $ 19,241 Six Months Ended June 30, 2017 Real Estate Construction 1-4 Family Residential Commercial Commercial Loans Municipal Loans Loans to Individuals Total Balance at beginning of period $ 4,147 $ 2,665 $ 7,204 $ 2,263 $ 750 $ 882 $ 17,911 Provision (reversal) for loan losses (1) (540 ) 12 2,757 (273 ) 15 473 2,444 Loans charged off (35 ) (288 ) — (577 ) — (1,242 ) (2,142 ) Recoveries of loans charged off 1 3 9 211 — 804 1,028 Balance at end of period $ 3,573 $ 2,392 $ 9,970 $ 1,624 $ 765 $ 917 $ 19,241 Three Months Ended June 30, 2016 Real Estate Construction 1-4 Family Residential Commercial Commercial Loans (2) Municipal Loans Loans to Individuals Total Balance at beginning of period $ 4,577 $ 2,155 $ 4,467 $ 8,964 $ 720 $ 916 $ 21,799 Provision (reversal) for loan losses (1) (154 ) (472 ) 208 4,094 (232 ) 324 3,768 Loans charged off — — — (10,650 ) — (654 ) (11,304 ) Recoveries of loans charged off — 3 5 66 249 322 645 Balance at end of period $ 4,423 $ 1,686 $ 4,680 $ 2,474 $ 737 $ 908 $ 14,908 Six Months Ended June 30, 2016 Real Estate Construction 1-4 Family Residential Commercial Commercial Loans (2) Municipal Loans Loans to Individuals Total Balance at beginning of period $ 4,350 $ 2,595 $ 4,577 $ 6,596 $ 725 $ 893 $ 19,736 Provision (reversal) for loan losses (1) (196 ) (1,023 ) 92 6,714 (237 ) 734 6,084 Loans charged off — (19 ) — (10,923 ) — (1,502 ) (12,444 ) Recoveries of loans charged off 269 133 11 87 249 783 1,532 Balance at end of period $ 4,423 $ 1,686 $ 4,680 $ 2,474 $ 737 $ 908 $ 14,908 (1) Of the $1.3 million and $2.4 million recorded in provision for loan losses for the three and six months ended June 30, 2017 , none related to provision expense on PCI loans. Of the $3.8 million and $6.1 million recorded in provision for loan losses for the three and six months ended June 30, 2016 , approximately $1.4 million related to provision expense on PCI loans as of June 30, 2016 . (2) Of the $10.7 million and $10.9 million in commercial charge-offs recorded for the three and six months ended June 30, 2016 , $10.6 million includes the partial charge-off of two large commercial borrowing relationships. |
Balance in the allowance for loan losses by portfolio segment based on impairment method | The following tables present the balance in the allowance for loan losses by portfolio segment based on impairment method (in thousands): As of June 30, 2017 Real Estate Construction 1-4 Family Residential Commercial Commercial Loans Municipal Loans Loans to Individuals Total Ending balance – individually evaluated for impairment (1) $ 5 $ 13 $ 15 $ 154 $ 11 $ 96 $ 294 Ending balance – collectively evaluated for impairment 3,568 2,379 9,955 1,470 754 821 18,947 Balance at end of period $ 3,573 $ 2,392 $ 9,970 $ 1,624 $ 765 $ 917 $ 19,241 As of December 31, 2016 Real Estate Construction 1-4 Family Residential Commercial Commercial Loans Municipal Loans Loans to Individuals Total Ending balance – individually evaluated for impairment (1) $ 13 $ 16 $ 17 $ 923 $ 11 $ 106 $ 1,086 Ending balance – collectively evaluated for impairment 4,134 2,649 7,187 1,340 739 776 16,825 Balance at end of period $ 4,147 $ 2,665 $ 7,204 $ 2,263 $ 750 $ 882 $ 17,911 (1) There was approximately $3,000 of allowance for loan losses associated with PCI loans as of June 30, 2017 and December 31, 2016 . |
Balance in recorded investments in loans by portfolio segment based on impairment method | The following tables present the recorded investment in loans by portfolio segment based on impairment method (in thousands): June 30, 2017 Real Estate Construction 1-4 Family Residential Commercial Commercial Loans Municipal Loans Loans to Individuals Total Loans individually evaluated for impairment $ 53 $ 1,651 $ 1,033 $ 983 $ 571 $ 257 $ 4,548 Loans collectively evaluated for impairment 386,663 608,219 1,030,982 170,040 304,452 96,652 2,597,008 Purchased credit impaired loans 137 5,535 1,614 1,288 — 68 8,642 Total ending loan balance $ 386,853 $ 615,405 $ 1,033,629 $ 172,311 $ 305,023 $ 96,977 $ 2,610,198 December 31, 2016 Real Estate Construction 1-4 Family Residential Commercial Commercial Loans Municipal Loans Loans to Individuals Total Loans individually evaluated for impairment $ 480 $ 1,693 $ 1,184 $ 5,840 $ 571 $ 241 $ 10,009 Loans collectively evaluated for impairment 379,526 629,893 942,818 170,159 298,012 116,923 2,537,331 Purchased credit impaired loans 169 5,653 1,976 1,266 — 133 9,197 Total ending loan balance $ 380,175 $ 637,239 $ 945,978 $ 177,265 $ 298,583 $ 117,297 $ 2,556,537 |
Summary of loans by credit quality indicators | The following tables set forth credit quality indicators by class of loans for the periods presented (in thousands): June 30, 2017 Pass Pass Watch (1) Special Mention (1) Substandard (1) Doubtful (1) Total Real Estate Loans: Construction $ 385,367 $ 33 $ — $ 1,437 $ 16 $ 386,853 1-4 Family Residential 611,148 13 — 3,899 345 615,405 Commercial 943,775 10,862 28,659 50,333 — 1,033,629 Commercial Loans 163,964 1,048 3,615 3,638 46 172,311 Municipal Loans 303,522 — 930 571 — 305,023 Loans to Individuals 96,021 — 31 545 380 96,977 Total $ 2,503,797 $ 11,956 $ 33,235 $ 60,423 $ 787 $ 2,610,198 December 31, 2016 Pass Pass Watch (1) Special Mention (1) Substandard (1) Doubtful (1) Total Real Estate Loans: Construction $ 374,443 $ 34 $ 571 $ 5,108 $ 19 $ 380,175 1-4 Family Residential 632,937 68 — 3,380 854 637,239 Commercial 885,049 17,739 10,587 32,603 — 945,978 Commercial Loans 158,943 1,187 8,086 9,012 37 177,265 Municipal Loans 297,014 — 998 571 — 298,583 Loans to Individuals 115,952 — 9 629 707 117,297 Total $ 2,464,338 $ 19,028 $ 20,251 $ 51,303 $ 1,617 $ 2,556,537 (1) Includes PCI loans comprised of $5,000 pass watch, $499,000 special mention, $1.0 million substandard and $28,000 doubtful as of June 30, 2017 . Includes PCI loans comprised of $5,000 pass watch, $511,000 special mention, $1.5 million substandard and $28,000 doubtful as of December 31, 2016 |
Summary of nonperforming assets for the period | The following table sets forth nonperforming assets for the periods presented (in thousands): At At Nonaccrual loans (1) $ 3,034 $ 8,280 Accruing loans past due more than 90 days (1) — 6 Restructured loans (2) 5,884 6,431 Other real estate owned 233 339 Repossessed assets 14 49 Total Nonperforming Assets $ 9,165 $ 15,105 (1) Excludes PCI loans measured at fair value at acquisition. (2) Includes $3.0 million and $3.1 million in PCI loans restructured as of June 30, 2017 and December 31, 2016 , respectively. |
Recorded investment in nonaccrual by class of loans | The following table sets forth the recorded investment in nonaccrual loans by class of loans for the periods presented (in thousands). The table ex cludes PCI loans measured at fair value at acquisition : Nonaccrual Loans June 30, 2017 December 31, 2016 Real Estate Loans: Construction $ 53 $ 105 1-4 Family Residential 1,012 1,067 Commercial 706 808 Commercial Loans 663 5,477 Loans to Individuals 600 823 Total $ 3,034 $ 8,280 |
Summary of impaired loans by class of loans for the period | The following tables set forth impaired loans by class of loans for the periods presented (in thousands). Impaired loans include restructured and nonaccrual loans for which the allowance was measured in accordance with section 310-10 of ASC Topic 310, “Receivables.” There were no impaired loans recorded without an allowance as of June 30, 2017 or December 31, 2016 . June 30, 2017 Unpaid Contractual Principal Balance Recorded Investment Related Allowance for Loan Losses Real Estate Loans: Construction $ 60 $ 53 $ 5 1-4 Family Residential 4,394 4,193 13 Commercial 1,486 1,406 15 Commercial Loans 1,204 1,100 154 Municipal Loans 571 571 11 Loans to Individuals 284 257 94 Total (1) $ 7,999 $ 7,580 $ 292 December 31, 2016 Unpaid Contractual Principal Balance Recorded Investment Related Allowance for Loan Losses Real Estate Loans: Construction $ 486 $ 480 $ 13 1-4 Family Residential 4,487 4,264 16 Commercial 1,631 1,574 17 Commercial Loans 6,108 5,941 923 Municipal Loans 571 571 11 Loans to Individuals 277 241 106 Total (1) $ 13,560 $ 13,071 $ 1,086 (1) Includes $3.0 million and $3.1 million of PCI loans that experienced deterioration in credit quality subsequent to the acquisition date as of June 30, 2017 and December 31, 2016 , respectively. |
Aging of recorded investment in past due loans by class of loans | The following tables present the aging of the recorded investment in past due loans by class of loans (in thousands): June 30, 2017 30-59 Days Past Due 60-89 Days Past Due Greater than 90 Days Past Due Total Past Due Current (1) Total Real Estate Loans: Construction $ — $ 17 $ 21 $ 38 $ 386,815 $ 386,853 1-4 Family Residential 92 812 723 1,627 613,778 615,405 Commercial 168 — 81 249 1,033,380 1,033,629 Commercial Loans 263 80 48 391 171,920 172,311 Municipal Loans — — — — 305,023 305,023 Loans to Individuals 596 194 157 947 96,030 96,977 Total $ 1,119 $ 1,103 $ 1,030 $ 3,252 $ 2,606,946 $ 2,610,198 December 31, 2016 30-59 Days Past Due 60-89 Days Past Due Greater than 90 Days Past Due Total Past Due Current (1) Total Real Estate Loans: Construction $ 917 $ 64 $ 86 $ 1,067 $ 379,108 $ 380,175 1-4 Family Residential 6,225 755 600 7,580 629,659 637,239 Commercial 70 154 154 378 945,600 945,978 Commercial Loans 783 300 3,459 4,542 172,723 177,265 Municipal Loans 113 — — 113 298,470 298,583 Loans to Individuals 1,550 320 185 2,055 115,242 117,297 Total $ 9,658 $ 1,593 $ 4,484 $ 15,735 $ 2,540,802 $ 2,556,537 (1) Includes PCI loans measured at fair value at acquisition. |
Average recorded investment and interest income on impaired loans | The following table sets forth average recorded investment and interest income recognized on impaired loans by class of loans for the periods presented (in thousands). The table excludes PCI loans measured at fair value at acquisition that have not experienced further deterioration in credit quality subsequent to the acquisition date : Three Months Ended June 30, 2017 June 30, 2016 Average Recorded Investment Interest Income Recognized Average Recorded Investment Interest Income Recognized Real Estate Loans: Construction $ 344 $ — $ 584 $ 5 1-4 Family residential 4,476 50 2,409 43 Commercial 1,158 10 5,403 21 Commercial loans 3,050 18 18,999 120 Municipal loans 571 8 637 9 Loans to individuals 226 1 263 2 Total $ 9,825 $ 87 $ 28,295 $ 200 Six Months Ended June 30, 2017 June 30, 2016 Average Recorded Investment Interest Income Recognized Average Recorded Interest Income Recognized Real Estate Loans: Construction $ 402 $ — $ 495 $ 12 1-4 Family Residential 4,390 107 2,195 83 Commercial 1,322 25 5,294 43 Commercial Loans 4,244 36 20,158 292 Municipal Loans 571 15 637 17 Loans to Individuals 248 3 258 4 Total $ 11,177 $ 186 $ 29,037 $ 451 |
Schedule of recorded investment in loans modified | The following tables set forth the recorded balance of loans considered to be TDRs that were restructured and the type of concession during the periods presented (dollars in thousands): Three Months Ended June 30, 2017 Extend Amortization Period Interest Rate Reductions Combination Total Modifications Number of Loans Commercial Loans $ 797 $ — $ — $ 797 2 Loans to Individuals 23 — 40 63 3 Total $ 820 $ — $ 40 $ 860 5 Six Months Ended June 30, 2017 Extend Amortization Period Interest Rate Reductions Combination Total Modifications Number of Loans Commercial Loans $ 841 $ — $ — $ 841 3 Loans to Individuals 29 — 51 80 5 Total $ 870 $ — $ 51 $ 921 8 Three Months Ended June 30, 2016 Extend Amortization Period Interest Rate Reductions Combination Total Modifications Number of Loans Real Estate Loans: Construction $ — $ — $ 24 $ 24 1 1-4 Family Residential — 77 2,743 2,820 2 Loans to Individuals 20 — 75 95 6 Total $ 20 $ 77 $ 2,842 $ 2,939 9 Six Months Ended June 30, 2016 Extend Amortization Period Interest Rate Reductions Combination Total Modifications Number of Loans Real Estate Loans: Construction $ 463 $ — $ 24 $ 487 2 1-4 Family Residential — 77 2,743 2,820 2 Other 2,088 — — 2,088 1 Commercial Loans 1,154 — — 1,154 4 Loans to Individuals 20 — 75 95 6 Total $ 3,725 $ 77 $ 2,842 $ 6,644 15 |
Schedule of acquired PCI Loans | The following table presents the outstanding principal balance and carrying value for PCI loans for the periods presented (in thousands): June 30, 2017 December 31, 2016 Outstanding principal balance $ 9,650 $ 10,612 Carrying amount $ 8,642 $ 9,197 |
Schedule of changes in accretable yield for pci loans | The following table presents the changes in the accretable yield during the periods for PCI loans (in thousands): Three Months Ended Six Months Ended 2017 2016 2017 2016 Balance at beginning of period $ 4,003 $ 2,342 $ 2,480 $ 2,493 Reclassifications (to) from nonaccretable discount (5 ) (235 ) 1,814 208 Accretion (240 ) (509 ) (536 ) (1,103 ) Balance at end of period $ 3,758 $ 1,598 $ 3,758 $ 1,598 |
Long-term Obligations (Tables)
Long-term Obligations (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Debt Disclosure [Abstract] | |
Summary of long-term obligation | Long-term obligations are summarized as follows (in thousands): June 30, December 31, Parent Company Subordinated notes: (1) 5.50% Subordinated Notes Due 2026, net of unamortized debt issuance costs (2) $ 98,171 $ 98,100 Total Subordinated notes 98,171 98,100 Long-term debt: (3) Southside Statutory Trust III Due 2033, net of unamortized debt issuance costs (4) 20,546 20,544 Southside Statutory Trust IV Due 2037 (5) 23,196 23,196 Southside Statutory Trust V Due 2037 (6) 12,887 12,887 Magnolia Trust Company I Due 2035 (7) 3,609 3,609 Total Long-term debt 60,238 60,236 Total Parent Company 158,409 158,336 Subsidiaries FHLB advances (8) 162,249 443,128 Total Subsidiaries 162,249 443,128 Total Long-term obligations $ 320,658 $ 601,464 (1) This long-term debt consists of subordinated notes with a remaining maturity greater than one year that qualify under the risk-based capital guidelines as Tier 2 capital, subject to certain limitations. (2) This debt carries a fixed rate of 5.50% through September 29, 2021 and thereafter, adjusts quarterly at a rate equal to three-month LIBOR plus 429.7 basis points . (3) This long-term debt consists of trust preferred securities that qualify under the risk-based capital guidelines as Tier 1 capital, subject to certain limitations. (4) This debt carries an adjustable rate of 4.23639% through September 29, 2017 and adjusts quarterly at a rate equal to three-month LIBOR plus 294 basis points . (5) This debt carries an adjustable rate of 2.46956% through July 29, 2017 and adjusts quarterly at a rate equal to three-month LIBOR plus 130 basis points . (6) This debt carries an adjustable rate of 3.49556% through September 14, 2017 and adjusts quarterly at a rate equal to three-month LIBOR plus 225 basis points . (7) This debt carries an adjustable rate of 2.98644% through August 22, 2017 and adjusts quarterly at a rate equal to three-month LIBOR plus 180 basis points . (8) At June 30, 2017 , the weighted average cost of these advances was 1.8% . Long-term FHLB advances have maturities ranging from July 2018 through July 2028 . |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Defined Contribution Plan [Abstract] | |
The components of net periodic benefit cost | The components of net periodic benefit cost (income) are as follows (in thousands): Three Months Ended June 30, Defined Benefit Defined Benefit Pension Plan Acquired Restoration 2017 2016 2017 2016 2017 2016 Service cost $ 341 $ 316 $ — $ — $ 73 $ 56 Interest cost 888 953 44 53 151 133 Expected return on assets (1,513 ) (1,257 ) (53 ) (66 ) — — Net loss amortization 312 462 — — 104 40 Prior service (credit) cost amortization (3 ) 7 — — 1 1 Special and contractual termination benefits — 29 — — — — Net periodic benefit cost (income) $ 25 $ 510 $ (9 ) $ (13 ) $ 329 $ 230 Six Months Ended June 30, Defined Benefit Defined Benefit Pension Plan Acquired Restoration 2017 2016 2017 2016 2017 2016 Service cost $ 699 $ 684 $ — $ — $ 124 $ 103 Interest cost 1,800 1,870 89 106 283 268 Expected return on assets (3,025 ) (2,611 ) (107 ) (133 ) — — Net loss amortization 656 820 — — 151 93 Prior service (credit) cost amortization (7 ) 1 — — 3 3 Special and contractual termination benefits — 1,549 — — — — Net periodic benefit cost (income) $ 123 $ 2,313 $ (18 ) $ (27 ) $ 561 $ 467 |
Share-based Incentive Plans (Ta
Share-based Incentive Plans (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Shares Issued in Connection With Stock Compensation Awards | Shares issued in connection with stock compensation awards along with other related information were as follows (in thousands, except per share amounts): Three Months Ended Six Months Ended 2017 2016 2017 2016 New shares issued from available authorized shares 14,715 18,256 48,311 23,168 New shares issued from available treasury shares 11,767 — 11,767 — Total 26,482 18,256 60,078 23,168 Proceeds from stock option exercises $ 383 $ 159 $ 1,022 $ 194 |
Derivative Financial Instrume31
Derivative Financial Instruments and Hedging Activities (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value [Table Text Block] | The following tables present the notional and estimated fair value amount of derivative positions outstanding for the periods presented (in thousands): June 30, 2017 December 31, 2016 Estimated Fair Value Estimated Fair Value Notional (1) Asset Derivative Liability Derivative Notional (1) Asset Derivative Liability Derivative Derivatives designated as hedging instruments Interest rate contracts: Swaps-Cash Flow Hedge-Financial institution counterparties $ 240,000 $ 6,189 $ 344 $ 250,000 $ 7,069 $ — Derivatives designated as non-hedging instruments Interest rate contracts: Swaps-Financial institution counterparties 67,942 76 1,222 2,182 85 — Swaps-Customer counterparties 67,942 1,222 76 2,182 — 85 Gross derivatives 7,487 1,642 7,154 85 Offsetting derivative assets/liabilities (420 ) (420 ) — — Cash collateral received/posted (4,760 ) (1,146 ) (7,154 ) — Net derivatives included in the consolidated balance sheets (2) $ 2,307 $ 76 $ — $ 85 (1) Notional amounts, which represent the extent of involvement in the derivatives market, are used to determine the contractual cash flows required in accordance with the terms of the agreement. These amounts are typically not exchanged, significantly exceed amounts subject to credit or market risk, and are not reflected in the consolidated balance sheets. (2) Net derivative assets are included in “other assets” and net derivative liabilities are included in “other liabilities” on the consolidated balance sheets. Included in the fair value of net derivative assets and net derivative liabilities are credit valuation adjustments reflecting counterparty credit risk and our credit risk. We had net credit exposure of $1.6 million related to interest rate swaps with financial institutions and $1.2 million related to interest rate swaps with customers at June 30, 2017 . The credit risk associated with customer transactions is partially mitigated as these transactions are generally secured by the non-cash collateral securing the underlying transaction being hedged. We had no credit exposure related to interest rate swaps with financial or customer counterparties at December 31, 2016 . |
Weighted Average Maturity And Interest Rates On Risk Management Interest Rate Swaps [Table Text Block] | The summarized expected weighted average remaining maturity of the notional amount of interest rate swaps and the weighted average interest rates associated with the amounts expected to be received or paid on interest rate swap agreements are presented below (dollars in thousands). Variable rates received on pay fixed swaps are based on one-month or three-month LIBOR rates in effect at June 30, 2017 and December 31, 2016 : June 30, 2017 December 31, 2016 Weighted Average Weighted Average Notional Amount Remaining Maturity (in years) Receive Rate Pay Rate Notional Amount Remaining Maturity Receive Rate Pay Swaps-Cash Flow Hedge Financial institution counterparties $ 240,000 5.8 1.14 % 1.43 % $ 250,000 5.4 0.68 % 1.31 % Swaps-Non-Hedging Financial institution counterparties 67,942 13.2 1.04 2.37 2,182 9.7 0.62 1.57 Customer counterparties 67,942 13.2 2.37 1.04 2,182 9.7 1.57 0.62 |
Fair Value Measurement (Tables)
Fair Value Measurement (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Summary of fair value measurement on recurring and nonrecurring basis segregated by level of valuation inputs within fair value hierarchy utilized to measure fair value | The following tables summarize assets measured at fair value on a recurring and nonrecurring basis segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value (in thousands): As of June 30, 2017 Fair Value Measurements at the End of the Reporting Period Using Carrying Amount Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Recurring fair value measurements Investment Securities: State and Political Subdivisions $ 326,159 $ — $ 326,159 $ — Other Stocks and Bonds 5,144 — 5,144 — Other Equity Securities 5,954 5,954 — — Mortgage-backed Securities: (1) Residential 654,104 — 654,104 — Commercial 406,450 — 406,450 — Derivative assets: Interest rate swaps 7,487 — 7,487 — Total asset recurring fair value measurements $ 1,405,298 $ 5,954 $ 1,399,344 $ — Derivative liabilities: Interest rate swaps $ 1,642 $ — $ 1,642 $ — Total liability recurring fair value measurements $ 1,642 $ — $ 1,642 $ — Nonrecurring fair value measurements Foreclosed assets $ 247 $ — $ — $ 247 Impaired loans (2) 6,785 — — 6,785 Total asset nonrecurring fair value measurements $ 7,032 $ — $ — $ 7,032 As of December 31, 2016 Fair Value Measurements at the End of the Reporting Period Using Carrying Amount Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Recurring fair value measurements Investment Securities: U.S. Treasury $ 70,069 $ 70,069 $ — $ — State and Political Subdivisions 385,197 — 385,197 — Other Stocks and Bonds 6,651 — 6,651 — Other Equity Securities 5,920 5,920 — — Mortgage-backed Securities: (1) Residential 627,508 — 627,508 — Commercial 384,255 — 384,255 — Derivative assets: Interest rate swaps 7,154 — 7,154 — Total asset recurring fair value measurements $ 1,486,754 $ 75,989 $ 1,410,765 $ — Derivative liabilities: Interest rate swaps $ 85 $ — $ 85 $ — Total liability recurring fair value measurements $ 85 $ — $ 85 $ — Nonrecurring fair value measurements Foreclosed assets $ 388 $ — $ — $ 388 Impaired loans (2) 9,693 — — 9,693 Total asset nonrecurring fair value measurements $ 10,081 $ — $ — $ 10,081 (1) All mortgage-backed securities are issued and/or guaranteed by U.S. government agencies or U.S. government-sponsored enterprises. (2) Impaired loans represent collateral-dependent loans with a specific valuation allowance. Losses on these loans represent charge-offs which are netted against the allowance for loan losses. |
Financial assets, financial liabilities, and unrecognized financial instruments at carrying amount and fair value | The following tables present our financial assets, financial liabilities, and unrecognized financial instruments measured on a nonrecurring basis at both their respective carrying amounts and estimated fair value (in thousands): Estimated Fair Value June 30, 2017 Carrying Total Level 1 Level 2 Level 3 Financial Assets: Cash and cash equivalents $ 235,832 $ 235,832 $ 235,832 $ — $ — Investment Securities: Held to maturity, at carrying value 419,825 430,155 — 430,155 — Mortgage-backed Securities: Held to maturity, at carrying value 505,713 513,621 — 513,621 — FHLB stock, at cost, and other investments 66,985 66,985 — 66,985 — Loans, net of allowance for loan losses 2,590,957 2,603,697 — — 2,603,697 Loans held for sale 3,036 3,036 — 3,036 — Financial Liabilities: Deposits $ 3,624,073 $ 3,620,875 $ — $ 3,620,875 $ — Federal funds purchased and repurchase agreements 8,424 8,424 — 8,424 — FHLB advances 1,178,082 1,172,459 — 1,172,459 — Subordinated notes, net of unamortized debt issuance costs 98,171 102,771 — 102,771 — Long-term debt , net of unamortized debt issuance costs 60,238 47,897 — 47,897 — Estimated Fair Value December 31, 2016 Carrying Total Level 1 Level 2 Level 3 Financial Assets: Cash and cash equivalents $ 169,654 $ 169,654 $ 169,654 $ — $ — Investment Securities: Held to maturity, at carrying value 425,810 429,912 — 429,912 — Mortgage-backed Securities: Held to maturity, at carrying value 511,677 514,370 — 514,370 — FHLB stock, at cost, and other investments 66,592 66,592 — 66,592 — Loans, net of allowance for loan losses 2,538,626 2,630,009 — — 2,630,009 Loans held for sale 7,641 7,641 — 7,641 — Financial Liabilities: Deposits $ 3,533,076 $ 3,293,352 $ — $ 3,293,352 $ — Federal funds purchased and repurchase agreements 7,097 7,097 — 7,097 — FHLB advances 1,309,646 1,331,517 — 1,331,517 — Subordinated notes, net of unamortized debt issuance costs 98,100 101,627 — 101,627 — Long-term debt , net of unamortized debt issuance costs 60,236 45,147 — 45,147 — |
Income Taxes (Tables)
Income Taxes (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | The income tax expense included in the accompanying statements of income consists of the following (in thousands): Three Months Ended Six Months Ended 2017 2016 2017 2016 Current income tax expense $ 3,317 $ 1,454 $ 6,344 $ 5,239 Deferred income tax (benefit) expense 36 1,318 17 506 Income tax expense $ 3,353 $ 2,772 $ 6,361 $ 5,745 |
Off-Balance-Sheet Arrangement34
Off-Balance-Sheet Arrangements, Commitments and Contingencies (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of unused commitments | Financial instruments with off-balance-sheet risk were as follows (in thousands): At At Unused commitments: Commitments to extend credit $ 693,485 $ 665,663 Standby letters of credit 9,818 9,075 Total $ 703,303 $ 674,738 |
Summary of Significant Accoun35
Summary of Significant Accounting and Reporting Policies Stock Dividend (Details) | 6 Months Ended | |
Jun. 30, 2017Rate | Jun. 30, 2016Rate | |
Dividends, Common Stock [Abstract] | ||
Stock Dividends, Percentage of Common Stock | 2.50% | 5.00% |
Summary of Significant Accoun36
Summary of Significant Accounting and Reporting Policies - Reclassifications (Details) - Adjustments for New Accounting Pronouncement [Member] - USD ($) | 3 Months Ended | 6 Months Ended |
Jun. 30, 2017 | Jun. 30, 2017 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Income tax effects related to settlements of share-based payment awards reported in earnings as reduction of income tax expense | $ (84,000) | $ (210,000) |
New Accounting Pronouncement or Change in Accounting Principle, Effect of Change on Diluted Earnings Per Share | $ (0.01) | $ (0.01) |
Pending Acquisitions (Details)
Pending Acquisitions (Details) - USD ($) $ in Thousands | Jun. 12, 2017 | Jun. 30, 2017 | Dec. 31, 2016 |
Business Acquisition [Line Items] | |||
Assets of acquiree | $ 5,578,482 | $ 5,563,767 | |
Diboll State Bancshares, Inc. | |||
Business Acquisition [Line Items] | |||
Assets of acquiree | 993,800 | ||
Common stock shares to be issued for acquisition | 5,535,000 | ||
Cash to be paid for acquisition (up to) | $ 25,000 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Basic and Diluted Earnings: | ||||
Net income | $ 14,481 | $ 11,395 | $ 29,470 | $ 24,911 |
Basic weighted-average shares outstanding | 29,318 | 26,890 | 29,303 | 27,002 |
Add: Stock awards (in shares) | 201 | 123 | 208 | 97 |
Diluted weighted-average shares outstanding | 29,519 | 27,013 | 29,511 | 27,099 |
Basic Earnings Per Share: | ||||
Earnings per common share - basic (in dollars per share) | $ 0.49 | $ 0.42 | $ 1.01 | $ 0.92 |
Diluted Earnings Per Share: | ||||
Earnings per common share - diluted (in dollars per share) | $ 0.49 | $ 0.42 | $ 1 | $ 0.92 |
Antidilutive securities from non-qualified stock options excluded from calculating earnings | ||||
Number of antidilutive options (in shares) | 52 | 23 | 51 | 54 |
Accumulated Other Comprehensi39
Accumulated Other Comprehensive Income (Loss) - Accumulated Other Comprehensive Income, Changes In (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | ||
AOCI Attributable to Parent, Net of Tax | |||||
Beginning Balance | $ 518,274 | $ 444,062 | |||
Income tax (expense) benefit | $ (4,332) | $ (4,544) | (6,433) | (12,777) | |
Ending Balance | 547,065 | 472,300 | 547,065 | 472,300 | |
Unrealized Gains (Losses) on Securities | |||||
AOCI Attributable to Parent, Net of Tax | |||||
Beginning Balance | (20,425) | 16,245 | (23,708) | (239) | |
Other comprehensive income (loss) before reclassifications | 13,221 | 16,247 | 18,106 | 43,991 | |
Reclassified from accumulated other comprehensive income (loss) | 288 | (641) | 454 | (3,025) | |
Income tax (expense) benefit | (4,728) | (5,462) | (6,496) | (14,338) | |
Net current-period other comprehensive income (loss), net of tax | 8,781 | 10,144 | 12,064 | 26,628 | |
Ending Balance | (11,644) | 26,389 | (11,644) | 26,389 | |
Unrealized Gains (Losses) on Derivatives | |||||
AOCI Attributable to Parent, Net of Tax | |||||
Beginning Balance | 4,961 | (1,459) | 4,595 | 0 | |
Other comprehensive income (loss) before reclassifications | (1,768) | (3,594) | (1,575) | (6,195) | |
Reclassified from accumulated other comprehensive income (loss) | 223 | 460 | 593 | 817 | |
Income tax (expense) benefit | 541 | 1,097 | 344 | 1,882 | |
Net current-period other comprehensive income (loss), net of tax | (1,004) | (2,037) | (638) | (3,496) | |
Ending Balance | 3,957 | (3,496) | 3,957 | (3,496) | |
Net Prior Service (Cost) Credit | |||||
AOCI Attributable to Parent, Net of Tax | |||||
Beginning Balance | (134) | (47) | (133) | (44) | |
Other comprehensive income (loss) before reclassifications | 0 | 0 | 0 | 0 | |
Reclassified from accumulated other comprehensive income (loss) | [1] | (2) | 8 | (4) | 4 |
Income tax (expense) benefit | 0 | (3) | 1 | (2) | |
Net current-period other comprehensive income (loss), net of tax | (2) | 5 | (3) | 2 | |
Ending Balance | (136) | (42) | (136) | (42) | |
Net Gain (Loss) | |||||
AOCI Attributable to Parent, Net of Tax | |||||
Beginning Balance | (18,993) | (18,132) | (19,247) | (18,400) | |
Other comprehensive income (loss) before reclassifications | 0 | 0 | 0 | 0 | |
Reclassified from accumulated other comprehensive income (loss) | [1] | 416 | 502 | 807 | 913 |
Income tax (expense) benefit | (145) | (176) | (282) | (319) | |
Net current-period other comprehensive income (loss), net of tax | 271 | 326 | 525 | 594 | |
Ending Balance | (18,722) | (17,806) | (18,722) | (17,806) | |
Total | |||||
AOCI Attributable to Parent, Net of Tax | |||||
Beginning Balance | (34,591) | (3,393) | (38,493) | (18,683) | |
Other comprehensive income (loss) before reclassifications | 11,453 | 12,653 | 16,531 | 37,796 | |
Reclassified from accumulated other comprehensive income (loss) | 925 | 329 | 1,850 | (1,291) | |
Income tax (expense) benefit | (4,332) | (4,544) | (6,433) | (12,777) | |
Net current-period other comprehensive income (loss), net of tax | 8,046 | 8,438 | 11,948 | 23,728 | |
Ending Balance | $ (26,545) | $ 5,045 | $ (26,545) | $ 5,045 | |
[1] | These accumulated other comprehensive income components are included in the computation of net periodic pension cost (income) presented in “Note 8 - Employee Benefit Plans.” |
Accumulated Other Comprehensi40
Accumulated Other Comprehensive Income (Loss) - Reclassifications out of Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Amortization of unrealized losses | $ 213 | $ 87 | $ 701 | $ 144 | |
Tax benefit (expense) | (3,353) | (2,772) | (6,361) | (5,745) | |
Amortization of unrealized gains on terminated interest rate swap derivatives | 17,834 | 14,167 | 35,831 | 30,656 | |
Total reclassifications for the period, net of tax | (601) | (214) | (1,203) | 839 | |
Unrealized gains (losses) | |||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Total before tax | (288) | 641 | (454) | 3,025 | |
Realized net loss on interest rate swap derivatives | |||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Total before tax | (223) | (460) | (593) | (817) | |
Net actuarial loss | |||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Total before tax | [1] | (416) | (502) | (807) | (913) |
Prior service credit | |||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Total before tax | [1] | 2 | (8) | 4 | (4) |
Amortization of pension plan | |||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Total before tax | (414) | (510) | (803) | (917) | |
Tax benefit | 145 | 179 | 281 | 321 | |
Total reclassifications for the period, net of tax | (269) | (331) | (522) | (596) | |
Unrealized losses on securities transferred to held to maturity | Reclassification out of accumulated other comprehensive income | Unrealized gains (losses) | |||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Amortization of unrealized losses | [2] | (213) | (87) | (701) | (144) |
Tax benefit (expense) | 75 | 30 | 245 | 50 | |
Net of tax | (138) | (57) | (456) | (94) | |
Unrealized gains and losses on available for sale securities | Reclassification out of accumulated other comprehensive income | Unrealized gains (losses) | |||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Tax benefit (expense) | 26 | (255) | (86) | (1,109) | |
Net of tax | (49) | 473 | 161 | 2,060 | |
Realized net gain on sale of securities | [3] | (75) | 728 | 247 | 3,169 |
Interest rate swap derivatives | Reclassification out of accumulated other comprehensive income | Realized net loss on interest rate swap derivatives | |||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Tax benefit (expense) | 86 | 161 | 218 | 286 | |
Net of tax | (159) | (299) | (406) | (531) | |
Realized net loss on interest rate swap derivatives | [4] | (245) | (460) | (624) | (817) |
Interest rate swap derivatives | Reclassification out of accumulated other comprehensive income | Amortization of unrealized gains on terminated interest rate swap derivatives | |||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Tax benefit (expense) | (8) | 0 | (11) | 0 | |
Net of tax | 14 | 0 | 20 | 0 | |
Amortization of unrealized gains on terminated interest rate swap derivatives | [4] | $ 22 | $ 0 | $ 31 | $ 0 |
[1] | These accumulated other comprehensive income components are included in the computation of net periodic pension cost (income) presented in “Note 8 - Employee Benefit Plans.” | ||||
[2] | Included in interest income on the consolidated statements of income. | ||||
[3] | Listed as net (loss) gain on sale of securities available for sale on the consolidated statements of income. | ||||
[4] | Included in interest expense for long-term obligations on the consolidated statements of income. |
Securities - Schedule of Debt
Securities - Schedule of Debt and Equity Securities Components (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 | |
AVAILABLE FOR SALE | |||
Amortized cost | $ 1,397,756 | $ 1,497,404 | |
Gross unrealized gains, in OCI | 12,975 | 10,916 | |
Gross unrealized losses, in OCI | 12,920 | 28,720 | |
Estimated fair value | 1,397,811 | 1,479,600 | |
HELD TO MATURITY | |||
Amortized cost | 943,506 | 956,156 | |
Gross unrealized gains, in OCI | 4,179 | 5,054 | |
Gross unrealized losses, in OCI | 22,147 | 23,723 | |
Carrying value | 925,538 | 937,487 | |
Gross unrealized gains, not in OCI | 21,480 | 13,501 | |
Gross unrealized losses, not in OCI | 3,242 | 6,706 | |
Estimated fair value | 943,776 | 944,282 | |
U.S. Treasury | |||
AVAILABLE FOR SALE | |||
Amortized cost | 74,016 | ||
Gross unrealized gains, in OCI | 0 | ||
Gross unrealized losses, in OCI | 3,947 | ||
Estimated fair value | 70,069 | ||
State and Political Subdivisions | |||
AVAILABLE FOR SALE | |||
Amortized cost | 330,155 | 394,050 | |
Gross unrealized gains, in OCI | 3,047 | 3,217 | |
Gross unrealized losses, in OCI | 7,043 | 12,070 | |
Estimated fair value | 326,159 | 385,197 | |
HELD TO MATURITY | |||
Amortized cost | 429,146 | 435,080 | |
Gross unrealized gains, in OCI | 3,196 | 3,987 | |
Gross unrealized losses, in OCI | 12,517 | 13,257 | |
Carrying value | 419,825 | 425,810 | |
Gross unrealized gains, not in OCI | 12,529 | 7,595 | |
Gross unrealized losses, not in OCI | 2,199 | 3,493 | |
Estimated fair value | 430,155 | 429,912 | |
Other Stocks and Bonds | |||
AVAILABLE FOR SALE | |||
Amortized cost | 5,059 | 6,587 | |
Gross unrealized gains, in OCI | 85 | 64 | |
Gross unrealized losses, in OCI | 0 | 0 | |
Estimated fair value | 5,144 | 6,651 | |
Other Equity Securities | |||
AVAILABLE FOR SALE | |||
Amortized cost | 6,034 | 6,039 | |
Gross unrealized gains, in OCI | 0 | 0 | |
Gross unrealized losses, in OCI | 80 | 119 | |
Estimated fair value | 5,954 | 5,920 | |
Residential | |||
AVAILABLE FOR SALE | |||
Amortized cost | [1] | 651,291 | 630,603 |
Gross unrealized gains, in OCI | [1] | 7,376 | 6,434 |
Gross unrealized losses, in OCI | [1] | 4,563 | 9,529 |
Estimated fair value | [1] | 654,104 | 627,508 |
HELD TO MATURITY | |||
Amortized cost | [1] | 135,110 | 142,060 |
Gross unrealized gains, in OCI | [1] | 0 | 0 |
Gross unrealized losses, in OCI | [1] | 5,328 | 5,748 |
Carrying value | [1] | 129,782 | 136,312 |
Gross unrealized gains, not in OCI | [1] | 2,587 | 1,534 |
Gross unrealized losses, not in OCI | [1] | 249 | 950 |
Estimated fair value | [1] | 132,120 | 136,896 |
Commercial | |||
AVAILABLE FOR SALE | |||
Amortized cost | [1] | 405,217 | 386,109 |
Gross unrealized gains, in OCI | [1] | 2,467 | 1,201 |
Gross unrealized losses, in OCI | [1] | 1,234 | 3,055 |
Estimated fair value | [1] | 406,450 | 384,255 |
HELD TO MATURITY | |||
Amortized cost | [1] | 379,250 | 379,016 |
Gross unrealized gains, in OCI | [1] | 983 | 1,067 |
Gross unrealized losses, in OCI | [1] | 4,302 | 4,718 |
Carrying value | [1] | 375,931 | 375,365 |
Gross unrealized gains, not in OCI | [1] | 6,364 | 4,372 |
Gross unrealized losses, not in OCI | [1] | 794 | 2,263 |
Estimated fair value | [1] | $ 381,501 | $ 377,474 |
[1] | All mortgage-backed securities issued and/or guaranteed by U.S. government agencies or U.S. government-sponsored enterprises. |
Securities - Unrealized Loss o
Securities - Unrealized Loss on Securities (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value [Abstract] | ||
Less than 12 months, fair value | $ 548,009 | $ 955,799 |
More than 12 months, fair value | 31,117 | 7,086 |
Total fair value | 579,126 | 962,885 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months, unrealized loss | 11,358 | 28,681 |
More than 12 months, unrealized loss | 1,562 | 39 |
Total unrealized loss | 12,920 | 28,720 |
Held-to-maturity Securities, Continuous Unrealized Loss Position, Fair Value [Abstract] | ||
Less than 12 months, fair value | 127,571 | 473,817 |
More than 12 months, fair value | 32,490 | 29,427 |
Total fair value | 160,061 | 503,244 |
Held-to-maturity Securities, Continuous Unrealized Loss Position, Accumulated Losses [Abstract] | ||
Less than 12 months, unrealized loss | 1,749 | 5,403 |
More than 12 months, unrealized loss | 1,493 | 1,303 |
Total unrealized loss | 3,242 | 6,706 |
U.S. Treasury | ||
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value [Abstract] | ||
Less than 12 months, fair value | 70,069 | |
More than 12 months, fair value | 0 | |
Total fair value | 70,069 | |
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months, unrealized loss | 3,947 | |
More than 12 months, unrealized loss | 0 | |
Total unrealized loss | 3,947 | |
State and Political Subdivisions | ||
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value [Abstract] | ||
Less than 12 months, fair value | 211,790 | 264,485 |
More than 12 months, fair value | 8,285 | 887 |
Total fair value | 220,075 | 265,372 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months, unrealized loss | 6,653 | 12,069 |
More than 12 months, unrealized loss | 390 | 1 |
Total unrealized loss | 7,043 | 12,070 |
Held-to-maturity Securities, Continuous Unrealized Loss Position, Fair Value [Abstract] | ||
Less than 12 months, fair value | 59,673 | 179,939 |
More than 12 months, fair value | 32,490 | 29,427 |
Total fair value | 92,163 | 209,366 |
Held-to-maturity Securities, Continuous Unrealized Loss Position, Accumulated Losses [Abstract] | ||
Less than 12 months, unrealized loss | 706 | 2,190 |
More than 12 months, unrealized loss | 1,493 | 1,303 |
Total unrealized loss | 2,199 | 3,493 |
Other Equity Securities | ||
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value [Abstract] | ||
Less than 12 months, fair value | 5,954 | 5,920 |
More than 12 months, fair value | 0 | 0 |
Total fair value | 5,954 | 5,920 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months, unrealized loss | 80 | 119 |
More than 12 months, unrealized loss | 0 | 0 |
Total unrealized loss | 80 | 119 |
Residential | ||
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value [Abstract] | ||
Less than 12 months, fair value | 232,169 | 369,903 |
More than 12 months, fair value | 22,832 | 6,199 |
Total fair value | 255,001 | 376,102 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months, unrealized loss | 3,391 | 9,491 |
More than 12 months, unrealized loss | 1,172 | 38 |
Total unrealized loss | 4,563 | 9,529 |
Held-to-maturity Securities, Continuous Unrealized Loss Position, Fair Value [Abstract] | ||
Less than 12 months, fair value | 18,607 | 107,024 |
More than 12 months, fair value | 0 | 0 |
Total fair value | 18,607 | 107,024 |
Held-to-maturity Securities, Continuous Unrealized Loss Position, Accumulated Losses [Abstract] | ||
Less than 12 months, unrealized loss | 249 | 950 |
More than 12 months, unrealized loss | 0 | 0 |
Total unrealized loss | 249 | 950 |
Commercial | ||
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value [Abstract] | ||
Less than 12 months, fair value | 98,096 | 245,422 |
More than 12 months, fair value | 0 | 0 |
Total fair value | 98,096 | 245,422 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss [Abstract] | ||
Less than 12 months, unrealized loss | 1,234 | 3,055 |
More than 12 months, unrealized loss | 0 | 0 |
Total unrealized loss | 1,234 | 3,055 |
Held-to-maturity Securities, Continuous Unrealized Loss Position, Fair Value [Abstract] | ||
Less than 12 months, fair value | 49,291 | 186,854 |
More than 12 months, fair value | 0 | 0 |
Total fair value | 49,291 | 186,854 |
Held-to-maturity Securities, Continuous Unrealized Loss Position, Accumulated Losses [Abstract] | ||
Less than 12 months, unrealized loss | 794 | 2,263 |
More than 12 months, unrealized loss | 0 | 0 |
Total unrealized loss | $ 794 | $ 2,263 |
Securities - Interest Income o
Securities - Interest Income on Securities (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Investments, Debt and Equity Securities [Abstract] | ||||
U.S. Treasury | $ 204 | $ 21 | $ 519 | $ 148 |
State and Political Subdivisions | 6,157 | 5,137 | 12,711 | 10,492 |
Other Stocks and Bonds | 35 | 57 | 69 | 115 |
Other Equity Securities | 28 | 29 | 56 | 58 |
Mortgage-backed Securities | 10,818 | 9,366 | 20,863 | 18,757 |
Total interest income on securities | $ 17,242 | $ 14,610 | $ 34,218 | $ 29,570 |
Securities - Amortized Cost an
Securities - Amortized Cost and Estimated Fair Value of Investments in Debt Securities by Contractual Maturity (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Amortized Cost | ||
Due in one year or less | $ 8,090 | |
Due after one year through five years | 20,046 | |
Due after five years through ten years | 31,112 | |
Due after ten years | 275,966 | |
Total available-for-sale investment securities | 335,214 | |
Mortgage-backed Securities and Other Equity Securities: | 1,062,542 | |
Total | 1,397,756 | |
Fair Value | ||
Due in one year or less | 8,220 | |
Due after one year through five years | 20,797 | |
Due after five years through ten years | 31,582 | |
Due after ten years | 270,704 | |
Total available-for-sale investment securities | 331,303 | |
Mortgage-backed Securities and Other Equity Securities: | 1,066,508 | |
Total | 1,397,811 | $ 1,479,600 |
Carrying Value | ||
Due in one year or less | 22,130 | |
Due after one year through five years | 41,941 | |
Due after five years through ten years | 106,435 | |
Due after ten years | 249,319 | |
Total held-to-maturity investment securities | 419,825 | |
Mortgage-backed securities | 505,713 | |
Carrying value | 925,538 | 937,487 |
Fair Value | ||
Due in one year or less | 21,569 | |
Due after one year through five years | 42,155 | |
Due after five years through ten years | 108,483 | |
Due after ten years | 257,948 | |
Total held-to-maturity investment securities | 430,155 | |
Mortgage-backed securities | 513,621 | |
Total | $ 943,776 | $ 944,282 |
Securities - Narrative (Detail
Securities - Narrative (Details) - USD ($) | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Investments, Debt and Equity Securities [Abstract] | |||
Balance at beginning of period | $ 17,911,000 | $ 19,736,000 | $ 19,736,000 |
Securities Transferred From Available for Sale to Held to Maturity | 0 | 157,100,000 | |
Unrealized gain (loss) on securities transferred from AFS to HTM | (10,200,000) | ||
Unrealized gain (loss) on securities transferred from AFS to HTM, net of tax | (6,700,000) | ||
Available-for-sale Securities, Gross Realized Gain (Loss) [Abstract] | |||
Net realized gain on AFS securities | 247,000 | 3,200,000 | |
Realized gains | 3,600,000 | 3,700,000 | |
Realized losses | 3,300,000 | 551,000 | |
Held-to-maturity Securities, Other Disclosure Items [Abstract] | |||
Sales from HTM portfolio | 0 | $ 0 | |
Carrying value of investment securities pledged as collateral | $ 1,210,000,000 | $ 1,500,000,000 |
Loans and Allowance for Proba46
Loans and Allowance for Probable Loan Losses - Loans by Portfolio Segment (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 | |
Loans and Leases Receivable Disclosure [Abstract] | |||
Total ending loan balance | [1] | $ 2,610,198 | $ 2,556,537 |
Less: Allowance for loan losses | [2] | 19,241 | 17,911 |
Net Loans | 2,590,957 | 2,538,626 | |
Construction Real Estate Loans | |||
Loans and Leases Receivable Disclosure [Abstract] | |||
Total ending loan balance | 386,853 | 380,175 | |
1-4 Family Residential Real Estate Loans | |||
Loans and Leases Receivable Disclosure [Abstract] | |||
Total ending loan balance | 615,405 | 637,239 | |
Commercial Real Estate Loans | |||
Loans and Leases Receivable Disclosure [Abstract] | |||
Total ending loan balance | 1,033,629 | 945,978 | |
Commercial Loans | |||
Loans and Leases Receivable Disclosure [Abstract] | |||
Total ending loan balance | 172,311 | 177,265 | |
Municipal Loans | |||
Loans and Leases Receivable Disclosure [Abstract] | |||
Total ending loan balance | 305,023 | 298,583 | |
Loans to Individuals | |||
Loans and Leases Receivable Disclosure [Abstract] | |||
Total ending loan balance | 96,977 | 117,297 | |
OmniAmerican Bancorp, Inc. | |||
Loans and Financing Receivable [Line Items] | |||
Loans acquired carrying amount | 295,600 | 372,400 | |
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment, PCI Loans | $ 3 | $ 3 | |
[1] | Includes approximately $295.6 million and $372.4 million of loans acquired with the Omni acquisition as of June 30, 2017 and December 31, 2016, respectively. | ||
[2] | The allowance for loan loss recorded on purchase credit impaired (“PCI”) loans totaled $3,000 as of June 30, 2017 and December 31, 2016. |
Loans and Allowance for Proba47
Loans and Allowance for Probable Loan Losses - Allowance for Loan Losses Activity by Portfolio Segment (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | ||||
Allowances for Loan Losses [Roll Forward] | |||||||
Balance at beginning of period | $ 18,485,000 | $ 21,799,000 | $ 17,911,000 | $ 19,736,000 | |||
Provision (reversal) for loan losses | [1] | 1,346,000 | 3,768,000 | 2,444,000 | 6,084,000 | ||
Loans charged off | (1,088,000) | (11,304,000) | (2,142,000) | (12,444,000) | |||
Recoveries of loans charged off | 498,000 | 645,000 | 1,028,000 | 1,532,000 | |||
Balance at end of period | 19,241,000 | 14,908,000 | 19,241,000 | 14,908,000 | |||
Financing Receivable, Allowance for Credit Loss, Additional Information [Abstract] | |||||||
Provision for loan losses | 1,346,000 | 3,768,000 | 2,444,000 | 6,084,000 | |||
Provision for PCI Loans | 0 | 1,400,000 | 0 | 1,400,000 | |||
Construction Real Estate Loans | |||||||
Allowances for Loan Losses [Roll Forward] | |||||||
Balance at beginning of period | 3,407,000 | 4,577,000 | 4,147,000 | 4,350,000 | |||
Provision (reversal) for loan losses | 182,000 | (154,000) | (540,000) | (196,000) | |||
Loans charged off | (17,000) | 0 | (35,000) | 0 | |||
Recoveries of loans charged off | 1,000 | 0 | 1,000 | 269,000 | |||
Balance at end of period | 3,573,000 | 4,423,000 | 3,573,000 | 4,423,000 | |||
1-4 Family Residential Real Estate Loans | |||||||
Allowances for Loan Losses [Roll Forward] | |||||||
Balance at beginning of period | 2,317,000 | 2,155,000 | 2,665,000 | 2,595,000 | |||
Provision (reversal) for loan losses | 74,000 | (472,000) | 12,000 | (1,023,000) | |||
Loans charged off | (1,000) | 0 | (288,000) | (19,000) | |||
Recoveries of loans charged off | 2,000 | 3,000 | 3,000 | 133,000 | |||
Balance at end of period | 2,392,000 | 1,686,000 | 2,392,000 | 1,686,000 | |||
Commercial Real Estate Loans | |||||||
Allowances for Loan Losses [Roll Forward] | |||||||
Balance at beginning of period | 8,787,000 | 4,467,000 | 7,204,000 | 4,577,000 | |||
Provision (reversal) for loan losses | 1,180,000 | 208,000 | 2,757,000 | 92,000 | |||
Loans charged off | 0 | 0 | 0 | 0 | |||
Recoveries of loans charged off | 3,000 | 5,000 | 9,000 | 11,000 | |||
Balance at end of period | 9,970,000 | 4,680,000 | 9,970,000 | 4,680,000 | |||
Commercial Loans | |||||||
Allowances for Loan Losses [Roll Forward] | |||||||
Balance at beginning of period | 2,259,000 | 8,964,000 | 2,263,000 | 6,596,000 | |||
Provision (reversal) for loan losses | (161,000) | 4,094,000 | (273,000) | 6,714,000 | |||
Loans charged off | (574,000) | (10,650,000) | [2] | (577,000) | (10,923,000) | [2] | |
Recoveries of loans charged off | 100,000 | 66,000 | 211,000 | 87,000 | |||
Balance at end of period | 1,624,000 | 2,474,000 | 1,624,000 | 2,474,000 | |||
Financing Receivable, Allowance for Credit Loss, Additional Information [Abstract] | |||||||
Partial Charge Offs on Commercial Relationships | [2] | 10,600,000 | 10,600,000 | ||||
Municipal Loans | |||||||
Allowances for Loan Losses [Roll Forward] | |||||||
Balance at beginning of period | 746,000 | 720,000 | 750,000 | 725,000 | |||
Provision (reversal) for loan losses | 19,000 | (232,000) | 15,000 | (237,000) | |||
Loans charged off | 0 | 0 | 0 | 0 | |||
Recoveries of loans charged off | 0 | 249,000 | 0 | 249,000 | |||
Balance at end of period | 765,000 | 737,000 | 765,000 | 737,000 | |||
Loans to Individuals | |||||||
Allowances for Loan Losses [Roll Forward] | |||||||
Balance at beginning of period | 969,000 | 916,000 | 882,000 | 893,000 | |||
Provision (reversal) for loan losses | 52,000 | 324,000 | 473,000 | 734,000 | |||
Loans charged off | (496,000) | (654,000) | (1,242,000) | (1,502,000) | |||
Recoveries of loans charged off | 392,000 | 322,000 | 804,000 | 783,000 | |||
Balance at end of period | $ 917,000 | $ 908,000 | $ 917,000 | $ 908,000 | |||
[1] | Of the $1.3 million and $2.4 million recorded in provision for loan losses for the three and six months ended June 30, 2017, none related to provision expense on PCI loans. Of the $3.8 million and $6.1 million recorded in provision for loan losses for the three and six months ended June 30, 2016, approximately $1.4 million related to provision expense on PCI loans as of June 30, 2016. | ||||||
[2] | Of the $10.7 million and $10.9 million in commercial charge-offs recorded for the three and six months ended June 30, 2016, $10.6 million includes the partial charge-off of two large commercial borrowing relationships. |
Loans and Allowance for Proba48
Loans and Allowance for Probable Loan Losses - Allowance Balance, by Impairment Method (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | |
Schedule of Allowance For Loan Losses, Allowance Balance, by Impairment Method [Line Items] | |||||||
Ending balance - individually evaluated for impairment | [1] | $ 294 | $ 1,086 | ||||
Ending balance - collectively evaluated for impairment | 18,947 | 16,825 | |||||
Balance at end of period | 19,241 | $ 18,485 | 17,911 | $ 14,908 | $ 21,799 | $ 19,736 | |
Construction Real Estate Loans | |||||||
Schedule of Allowance For Loan Losses, Allowance Balance, by Impairment Method [Line Items] | |||||||
Ending balance - individually evaluated for impairment | [1] | 5 | 13 | ||||
Ending balance - collectively evaluated for impairment | 3,568 | 4,134 | |||||
Balance at end of period | 3,573 | 3,407 | 4,147 | 4,423 | 4,577 | 4,350 | |
1-4 Family Residential Real Estate Loans | |||||||
Schedule of Allowance For Loan Losses, Allowance Balance, by Impairment Method [Line Items] | |||||||
Ending balance - individually evaluated for impairment | [1] | 13 | 16 | ||||
Ending balance - collectively evaluated for impairment | 2,379 | 2,649 | |||||
Balance at end of period | 2,392 | 2,317 | 2,665 | 1,686 | 2,155 | 2,595 | |
Commercial Real Estate Loans | |||||||
Schedule of Allowance For Loan Losses, Allowance Balance, by Impairment Method [Line Items] | |||||||
Ending balance - individually evaluated for impairment | [1] | 15 | 17 | ||||
Ending balance - collectively evaluated for impairment | 9,955 | 7,187 | |||||
Balance at end of period | 9,970 | 8,787 | 7,204 | 4,680 | 4,467 | 4,577 | |
Commercial Loans | |||||||
Schedule of Allowance For Loan Losses, Allowance Balance, by Impairment Method [Line Items] | |||||||
Ending balance - individually evaluated for impairment | [1] | 154 | 923 | ||||
Ending balance - collectively evaluated for impairment | 1,470 | 1,340 | |||||
Balance at end of period | 1,624 | 2,259 | 2,263 | 2,474 | 8,964 | 6,596 | |
Municipal Loans | |||||||
Schedule of Allowance For Loan Losses, Allowance Balance, by Impairment Method [Line Items] | |||||||
Ending balance - individually evaluated for impairment | [1] | 11 | 11 | ||||
Ending balance - collectively evaluated for impairment | 754 | 739 | |||||
Balance at end of period | 765 | 746 | 750 | 737 | 720 | 725 | |
Loans to Individuals | |||||||
Schedule of Allowance For Loan Losses, Allowance Balance, by Impairment Method [Line Items] | |||||||
Ending balance - individually evaluated for impairment | [1] | 96 | 106 | ||||
Ending balance - collectively evaluated for impairment | 821 | 776 | |||||
Balance at end of period | 917 | $ 969 | 882 | $ 908 | $ 916 | $ 893 | |
OmniAmerican Bancorp, Inc. | |||||||
Schedule of Allowance For Loan Losses, Allowance Balance, by Impairment Method [Line Items] | |||||||
Allowance for credit losses, individually evaluated for impairment, PCI loans | $ 3 | $ 3 | |||||
[1] | There was approximately $3,000 of allowance for loan losses associated with PCI loans as of June 30, 2017 and December 31, 2016. |
Loans and Allowance for Proba49
Loans and Allowance for Probable Loan Losses - Allowance for Loan Losses, Loan Portfolio, by Impairment Method (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 | |
Schedule of Allowance For Loan Losses, Loan Balance, by Impairment Method [Line Items] | |||
Loans individually evaluated for impairment | $ 4,548 | $ 10,009 | |
Loans collectively evaluated for impairment | 2,597,008 | 2,537,331 | |
Purchased credit impaired loans | 8,642 | 9,197 | |
Total ending loan balance | [1] | 2,610,198 | 2,556,537 |
Construction Real Estate Loans | |||
Schedule of Allowance For Loan Losses, Loan Balance, by Impairment Method [Line Items] | |||
Loans individually evaluated for impairment | 53 | 480 | |
Loans collectively evaluated for impairment | 386,663 | 379,526 | |
Purchased credit impaired loans | 137 | 169 | |
Total ending loan balance | 386,853 | 380,175 | |
1-4 Family Residential Real Estate Loans | |||
Schedule of Allowance For Loan Losses, Loan Balance, by Impairment Method [Line Items] | |||
Loans individually evaluated for impairment | 1,651 | 1,693 | |
Loans collectively evaluated for impairment | 608,219 | 629,893 | |
Purchased credit impaired loans | 5,535 | 5,653 | |
Total ending loan balance | 615,405 | 637,239 | |
Commercial Real Estate Loans | |||
Schedule of Allowance For Loan Losses, Loan Balance, by Impairment Method [Line Items] | |||
Loans individually evaluated for impairment | 1,033 | 1,184 | |
Loans collectively evaluated for impairment | 1,030,982 | 942,818 | |
Purchased credit impaired loans | 1,614 | 1,976 | |
Total ending loan balance | 1,033,629 | 945,978 | |
Commercial Loans | |||
Schedule of Allowance For Loan Losses, Loan Balance, by Impairment Method [Line Items] | |||
Loans individually evaluated for impairment | 983 | 5,840 | |
Loans collectively evaluated for impairment | 170,040 | 170,159 | |
Purchased credit impaired loans | 1,288 | 1,266 | |
Total ending loan balance | 172,311 | 177,265 | |
Municipal Loans | |||
Schedule of Allowance For Loan Losses, Loan Balance, by Impairment Method [Line Items] | |||
Loans individually evaluated for impairment | 571 | 571 | |
Loans collectively evaluated for impairment | 304,452 | 298,012 | |
Purchased credit impaired loans | 0 | 0 | |
Total ending loan balance | 305,023 | 298,583 | |
Loans to Individuals | |||
Schedule of Allowance For Loan Losses, Loan Balance, by Impairment Method [Line Items] | |||
Loans individually evaluated for impairment | 257 | 241 | |
Loans collectively evaluated for impairment | 96,652 | 116,923 | |
Purchased credit impaired loans | 68 | 133 | |
Total ending loan balance | $ 96,977 | $ 117,297 | |
[1] | Includes approximately $295.6 million and $372.4 million of loans acquired with the Omni acquisition as of June 30, 2017 and December 31, 2016, respectively. |
Loans and Allowance for Proba50
Loans and Allowance for Probable Loan Losses - Loans by Credit Quality Indicator (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 | |
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [1] | $ 2,610,198 | $ 2,556,537 |
Purchased credit impaired loans | 8,642 | 9,197 | |
Pass | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | 2,503,797 | 2,464,338 | |
Pass Watch | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 11,956 | 19,028 |
Purchased credit impaired loans | 5 | 5 | |
Special Mention | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 33,235 | 20,251 |
Purchased credit impaired loans | 499 | 511 | |
Substandard | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 60,423 | 51,303 |
Purchased credit impaired loans | 1,000 | 1,500 | |
Doubtful | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 787 | 1,617 |
Purchased credit impaired loans | 28 | 28 | |
Construction Real Estate Loans | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | 386,853 | 380,175 | |
Purchased credit impaired loans | 137 | 169 | |
Construction Real Estate Loans | Pass | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | 385,367 | 374,443 | |
Construction Real Estate Loans | Pass Watch | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 33 | 34 |
Construction Real Estate Loans | Special Mention | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 0 | 571 |
Construction Real Estate Loans | Substandard | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 1,437 | 5,108 |
Construction Real Estate Loans | Doubtful | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 16 | 19 |
1-4 Family Residential Real Estate Loans | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | 615,405 | 637,239 | |
Purchased credit impaired loans | 5,535 | 5,653 | |
1-4 Family Residential Real Estate Loans | Pass | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | 611,148 | 632,937 | |
1-4 Family Residential Real Estate Loans | Pass Watch | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 13 | 68 |
1-4 Family Residential Real Estate Loans | Special Mention | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 0 | 0 |
1-4 Family Residential Real Estate Loans | Substandard | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 3,899 | 3,380 |
1-4 Family Residential Real Estate Loans | Doubtful | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 345 | 854 |
Commercial Real Estate Loans | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | 1,033,629 | 945,978 | |
Purchased credit impaired loans | 1,614 | 1,976 | |
Commercial Real Estate Loans | Pass | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | 943,775 | 885,049 | |
Commercial Real Estate Loans | Pass Watch | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 10,862 | 17,739 |
Commercial Real Estate Loans | Special Mention | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 28,659 | 10,587 |
Commercial Real Estate Loans | Substandard | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 50,333 | 32,603 |
Commercial Real Estate Loans | Doubtful | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 0 | 0 |
Commercial Loans | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | 172,311 | 177,265 | |
Purchased credit impaired loans | 1,288 | 1,266 | |
Commercial Loans | Pass | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | 163,964 | 158,943 | |
Commercial Loans | Pass Watch | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 1,048 | 1,187 |
Commercial Loans | Special Mention | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 3,615 | 8,086 |
Commercial Loans | Substandard | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 3,638 | 9,012 |
Commercial Loans | Doubtful | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 46 | 37 |
Municipal Loans | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | 305,023 | 298,583 | |
Purchased credit impaired loans | 0 | 0 | |
Municipal Loans | Pass | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | 303,522 | 297,014 | |
Municipal Loans | Pass Watch | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 0 | 0 |
Municipal Loans | Special Mention | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 930 | 998 |
Municipal Loans | Substandard | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 571 | 571 |
Municipal Loans | Doubtful | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 0 | 0 |
Loans to Individuals | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | 96,977 | 117,297 | |
Purchased credit impaired loans | 68 | 133 | |
Loans to Individuals | Pass | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | 96,021 | 115,952 | |
Loans to Individuals | Pass Watch | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 0 | 0 |
Loans to Individuals | Special Mention | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 31 | 9 |
Loans to Individuals | Substandard | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | 545 | 629 |
Loans to Individuals | Doubtful | |||
Financing Receivable, Recorded Investment, Credit Quality Indicator [Abstract] | |||
Loans | [2] | $ 380 | $ 707 |
[1] | Includes approximately $295.6 million and $372.4 million of loans acquired with the Omni acquisition as of June 30, 2017 and December 31, 2016, respectively. | ||
[2] | Includes PCI loans comprised of $5,000 pass watch, $499,000 special mention, $1.0 million substandard and $28,000 doubtful as of June 30, 2017. Includes PCI loans comprised of $5,000 pass watch, $511,000 special mention, $1.5 million substandard and $28,000 doubtful as of December 31, 2016. |
Loans and Allowance for Proba51
Loans and Allowance for Probable Loan Losses - Nonperforming Assets by Asset Class (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 | |
Nonperforming Assets by Asset Class [Abstract] | |||
Nonaccrual loans | [1] | $ 3,034 | $ 8,280 |
Accruing loans past due more than 90 days | 0 | 6 | |
Restructured loans | [2] | 5,884 | 6,431 |
Other real estate owned | 233 | 339 | |
Repossessed assets | 14 | 49 | |
Total Nonperforming Assets | 9,165 | 15,105 | |
Purchase Credit Impaired Loans Restructured | $ 3,000 | $ 3,100 | |
[1] | Excludes PCI loans measured at fair value at acquisition. | ||
[2] | Includes $3.0 million and $3.1 million in PCI loans restructured as of June 30, 2017 and December 31, 2016, respectively. |
Loans and Allowance for Proba52
Loans and Allowance for Probable Loan Losses - Nonaccrual by Class of Loans (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 | |
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Nonaccrual loans | [1] | $ 3,034 | $ 8,280 |
Construction Real Estate Loans | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Nonaccrual loans | 53 | 105 | |
1-4 Family Residential Real Estate Loans | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Nonaccrual loans | 1,012 | 1,067 | |
Commercial Real Estate Loans | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Nonaccrual loans | 706 | 808 | |
Commercial Loans | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Nonaccrual loans | 663 | 5,477 | |
Loans to Individuals | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Nonaccrual loans | $ 600 | $ 823 | |
[1] | Excludes PCI loans measured at fair value at acquisition. |
Loans and Allowance for Proba53
Loans and Allowance for Probable Loan Losses - Impaired Loans by Class of Loan (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 | |
Financing Receivable, Impaired [Line Items] | |||
Unpaid Contractual Principal Balance | [1] | $ 7,999 | $ 13,560 |
Recorded Investment | [1] | 7,580 | 13,071 |
Related Allowance for Loan Losses | 292 | 1,086 | |
PCI loans that experienced deterioration in credit quality subsequent to acquisition | 3,000 | 3,100 | |
Construction Real Estate Loans | |||
Financing Receivable, Impaired [Line Items] | |||
Unpaid Contractual Principal Balance | 60 | 486 | |
Recorded Investment | 53 | 480 | |
Related Allowance for Loan Losses | 5 | 13 | |
1-4 Family Residential Real Estate Loans | |||
Financing Receivable, Impaired [Line Items] | |||
Unpaid Contractual Principal Balance | 4,394 | 4,487 | |
Recorded Investment | 4,193 | 4,264 | |
Related Allowance for Loan Losses | 13 | 16 | |
Commercial Real Estate Loans | |||
Financing Receivable, Impaired [Line Items] | |||
Unpaid Contractual Principal Balance | 1,486 | 1,631 | |
Recorded Investment | 1,406 | 1,574 | |
Related Allowance for Loan Losses | 15 | 17 | |
Commercial Loans | |||
Financing Receivable, Impaired [Line Items] | |||
Unpaid Contractual Principal Balance | 1,204 | 6,108 | |
Recorded Investment | 1,100 | 5,941 | |
Related Allowance for Loan Losses | 154 | 923 | |
Municipal Loans | |||
Financing Receivable, Impaired [Line Items] | |||
Unpaid Contractual Principal Balance | 571 | 571 | |
Recorded Investment | 571 | 571 | |
Related Allowance for Loan Losses | 11 | 11 | |
Loans to Individuals | |||
Financing Receivable, Impaired [Line Items] | |||
Unpaid Contractual Principal Balance | 284 | 277 | |
Recorded Investment | 257 | 241 | |
Related Allowance for Loan Losses | $ 94 | $ 106 | |
[1] | Includes $3.0 million and $3.1 million of PCI loans that experienced deterioration in credit quality subsequent to the acquisition date as of June 30, 2017 and December 31, 2016, respectively. |
Loans and Allowance for Proba54
Loans and Allowance for Probable Loan Losses - Aging of Past Due Loans by Class of Loan (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 | |
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | $ 3,252 | $ 15,735 | |
Current | [1] | 2,606,946 | 2,540,802 |
Total ending loan balance | [2] | 2,610,198 | 2,556,537 |
30-59 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 1,119 | 9,658 | |
60-89 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 1,103 | 1,593 | |
Greater than 90 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 1,030 | 4,484 | |
Construction Real Estate Loans | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 38 | 1,067 | |
Current | [1] | 386,815 | 379,108 |
Total ending loan balance | 386,853 | 380,175 | |
Construction Real Estate Loans | 30-59 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 0 | 917 | |
Construction Real Estate Loans | 60-89 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 17 | 64 | |
Construction Real Estate Loans | Greater than 90 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 21 | 86 | |
1-4 Family Residential Real Estate Loans | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 1,627 | 7,580 | |
Current | [1] | 613,778 | 629,659 |
Total ending loan balance | 615,405 | 637,239 | |
1-4 Family Residential Real Estate Loans | 30-59 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 92 | 6,225 | |
1-4 Family Residential Real Estate Loans | 60-89 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 812 | 755 | |
1-4 Family Residential Real Estate Loans | Greater than 90 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 723 | 600 | |
Commercial Real Estate Loans | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 249 | 378 | |
Current | [1] | 1,033,380 | 945,600 |
Total ending loan balance | 1,033,629 | 945,978 | |
Commercial Real Estate Loans | 30-59 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 168 | 70 | |
Commercial Real Estate Loans | 60-89 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 0 | 154 | |
Commercial Real Estate Loans | Greater than 90 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 81 | 154 | |
Commercial Loans | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 391 | 4,542 | |
Current | [1] | 171,920 | 172,723 |
Total ending loan balance | 172,311 | 177,265 | |
Commercial Loans | 30-59 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 263 | 783 | |
Commercial Loans | 60-89 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 80 | 300 | |
Commercial Loans | Greater than 90 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 48 | 3,459 | |
Municipal Loans | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 0 | 113 | |
Current | [1] | 305,023 | 298,470 |
Total ending loan balance | 305,023 | 298,583 | |
Municipal Loans | 30-59 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 0 | 113 | |
Municipal Loans | 60-89 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 0 | 0 | |
Municipal Loans | Greater than 90 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 0 | 0 | |
Loans to Individuals | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 947 | 2,055 | |
Current | [1] | 96,030 | 115,242 |
Total ending loan balance | 96,977 | 117,297 | |
Loans to Individuals | 30-59 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 596 | 1,550 | |
Loans to Individuals | 60-89 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | 194 | 320 | |
Loans to Individuals | Greater than 90 Days Past Due | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Past Due | $ 157 | $ 185 | |
[1] | Includes PCI loans measured at fair value at acquisition. | ||
[2] | Includes approximately $295.6 million and $372.4 million of loans acquired with the Omni acquisition as of June 30, 2017 and December 31, 2016, respectively. |
Loans and Allowance for Proba55
Loans and Allowance for Probable Loan Losses - Interest Income on Impaired Loans (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Financing Receivable, Impaired [Line Items] | ||||
Average recorded investment | $ 9,825 | $ 28,295 | $ 11,177 | $ 29,037 |
Interest income recognized | 87 | 200 | 186 | 451 |
Construction Real Estate Loans | ||||
Financing Receivable, Impaired [Line Items] | ||||
Average recorded investment | 344 | 584 | 402 | 495 |
Interest income recognized | 0 | 5 | 0 | 12 |
1-4 Family Residential Real Estate Loans | ||||
Financing Receivable, Impaired [Line Items] | ||||
Average recorded investment | 4,476 | 2,409 | 4,390 | 2,195 |
Interest income recognized | 50 | 43 | 107 | 83 |
Commercial Real Estate Loans | ||||
Financing Receivable, Impaired [Line Items] | ||||
Average recorded investment | 1,158 | 5,403 | 1,322 | 5,294 |
Interest income recognized | 10 | 21 | 25 | 43 |
Commercial Loans | ||||
Financing Receivable, Impaired [Line Items] | ||||
Average recorded investment | 3,050 | 18,999 | 4,244 | 20,158 |
Interest income recognized | 18 | 120 | 36 | 292 |
Municipal Loans | ||||
Financing Receivable, Impaired [Line Items] | ||||
Average recorded investment | 571 | 637 | 571 | 637 |
Interest income recognized | 8 | 9 | 15 | 17 |
Loans to Individuals | ||||
Financing Receivable, Impaired [Line Items] | ||||
Average recorded investment | 226 | 263 | 248 | 258 |
Interest income recognized | $ 1 | $ 2 | $ 3 | $ 4 |
Loans and Allowance for Proba56
Loans and Allowance for Probable Loan Losses - Troubled Debt Restructurings (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017USD ($)contract | Jun. 30, 2016USD ($)contract | Jun. 30, 2017USD ($)contract | Jun. 30, 2016USD ($)contract | |
Financing Receivable, Modifications [Line Items] | ||||
Extend Amortization Period | $ 820 | $ 20 | $ 870 | $ 3,725 |
Interest Rate Reductions | 0 | 77 | 0 | 77 |
Combination | 40 | 2,842 | 51 | 2,842 |
Total Modifications | $ 860 | $ 2,939 | $ 921 | $ 6,644 |
Number of Loans | contract | 5 | 9 | 8 | 15 |
Construction Real Estate Loans | ||||
Financing Receivable, Modifications [Line Items] | ||||
Extend Amortization Period | $ 0 | $ 463 | ||
Interest Rate Reductions | 0 | 0 | ||
Combination | 24 | 24 | ||
Total Modifications | $ 24 | $ 487 | ||
Number of Loans | contract | 1 | 2 | ||
1-4 Family Residential Real Estate Loans | ||||
Financing Receivable, Modifications [Line Items] | ||||
Extend Amortization Period | $ 0 | $ 0 | ||
Interest Rate Reductions | 77 | 77 | ||
Combination | 2,743 | 2,743 | ||
Total Modifications | $ 2,820 | $ 2,820 | ||
Number of Loans | contract | 2 | 2 | ||
Commercial Real Estate Loans | ||||
Financing Receivable, Modifications [Line Items] | ||||
Extend Amortization Period | $ 2,088 | |||
Interest Rate Reductions | 0 | |||
Combination | 0 | |||
Total Modifications | $ 2,088 | |||
Number of Loans | contract | 1 | |||
Commercial Loans | ||||
Financing Receivable, Modifications [Line Items] | ||||
Extend Amortization Period | $ 797 | $ 841 | $ 1,154 | |
Interest Rate Reductions | 0 | 0 | 0 | |
Combination | 0 | 0 | 0 | |
Total Modifications | $ 797 | $ 841 | $ 1,154 | |
Number of Loans | contract | 2 | 3 | 4 | |
Loans to Individuals | ||||
Financing Receivable, Modifications [Line Items] | ||||
Extend Amortization Period | $ 23 | $ 20 | $ 29 | $ 20 |
Interest Rate Reductions | 0 | 0 | 0 | 0 |
Combination | 40 | 75 | 51 | 75 |
Total Modifications | $ 63 | $ 95 | $ 80 | $ 95 |
Number of Loans | contract | 3 | 6 | 5 | 6 |
Loans and Allowance for Proba57
Loans and Allowance for Probable Loan Losses - Purchased Credit Impaired (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Purchased Credit Impaired [Abstract] | |||||
Outstanding principal balance | $ 9,650 | $ 9,650 | $ 10,612 | ||
Purchased credit impaired loans | 8,642 | 8,642 | $ 9,197 | ||
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward] | |||||
Balance at beginning of period | 4,003 | $ 2,342 | 2,480 | $ 2,493 | |
Reclassifications (to) from nonaccretable discount | (5) | (235) | 1,814 | 208 | |
Accretion | (240) | (509) | (536) | (1,103) | |
Balance at end of period | $ 3,758 | $ 1,598 | $ 3,758 | $ 1,598 |
Loans and Allowance for Proba58
Loans and Allowance for Probable Loan Losses - Narrative (Details) - USD ($) | Jun. 30, 2017 | Dec. 31, 2016 | Jun. 30, 2016 |
Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract] | |||
Owner and nonowner-occupied real estate | $ 962,100,000 | ||
Loans secured by multi-family properties | 68,600,000 | ||
Loans secured by farmland | 2,900,000 | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Loans in process of foreclosure | 102,000 | $ 28,000 | |
Loans and leases receivable, impaired, commitment to lend | 0 | $ 0 | |
Minimum | |||
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Loan review larger dollar loan relationship scope, aggregate debt | 500,000 | ||
Specifically reserved loans or loan relationships threshold | $ 150,000 |
Long-term Obligations - Long-t
Long-term Obligations - Long-term Obligations (Details) - USD ($) | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2017 | Dec. 31, 2016 | ||
Debt Instruments [Abstract] | |||
Subordinated Debt | $ 98,171,000 | $ 98,100,000 | |
Long-term debt | 60,238,000 | 60,236,000 | |
Total long-term obligations | 320,658,000 | 601,464,000 | |
FHLB advances | 162,249,000 | 443,128,000 | |
Parent Company | |||
Debt Instruments [Abstract] | |||
Subordinated Debt | [1] | 98,171,000 | 98,100,000 |
Long-term debt | [2] | 60,238,000 | 60,236,000 |
Total long-term obligations | $ 158,409,000 | 158,336,000 | |
Parent Company | 5.50% Subordinated Notes Due 2026, net of unamortized debt issuance costs | |||
Debt Instrument [Line Items] | |||
Maturity date | 2,026 | ||
Aggregate principal amount of subordinated notes | $ 100,000,000 | 100,000,000 | |
Unamortized debt issuance costs | 1,800,000 | 1,900,000 | |
Debt Instruments [Abstract] | |||
Subordinated Debt | [1],[3] | $ 98,171,000 | 98,100,000 |
Long-term Debt, Other Disclosures [Abstract] | |||
Subordinated notes, interest rate | 5.50% | ||
Debt instrument, description of variable rate basis | [1],[3] | three-month LIBOR plus 429.7 basis points | |
Parent Company | Southside Statutory Trust III Due 2033, net of unamortized debt issuance costs | |||
Debt Instrument [Line Items] | |||
Maturity date | 2,033 | ||
Unamortized debt issuance costs | $ 73,000 | 75,000 | |
Debt Instruments [Abstract] | |||
Long-term debt | [2],[4] | $ 20,546,000 | 20,544,000 |
Long-term Debt, Other Disclosures [Abstract] | |||
Debt instrument, description of variable rate basis | three-month LIBOR plus 294 basis points | ||
Adjusted rate of debt | 4.23639% | ||
Parent Company | Southside Statutory Trust IV Due 2037 | |||
Debt Instrument [Line Items] | |||
Maturity date | 2,037 | ||
Debt Instruments [Abstract] | |||
Long-term debt | [2],[5] | $ 23,196,000 | 23,196,000 |
Long-term Debt, Other Disclosures [Abstract] | |||
Debt instrument, description of variable rate basis | three-month LIBOR plus 130 basis points | ||
Adjusted rate of debt | 2.46956% | ||
Parent Company | Southside Statutory Trust V Due 2037 | |||
Debt Instrument [Line Items] | |||
Maturity date | 2,037 | ||
Debt Instruments [Abstract] | |||
Long-term debt | [2],[6] | $ 12,887,000 | 12,887,000 |
Long-term Debt, Other Disclosures [Abstract] | |||
Debt instrument, description of variable rate basis | three-month LIBOR plus 225 basis points | ||
Adjusted rate of debt | 3.49556% | ||
Parent Company | Magnolia Trust Company I Due 2035 | |||
Debt Instrument [Line Items] | |||
Maturity date | 2,035 | ||
Debt Instruments [Abstract] | |||
Long-term debt | [2],[7] | $ 3,609,000 | 3,609,000 |
Long-term Debt, Other Disclosures [Abstract] | |||
Debt instrument, description of variable rate basis | three-month LIBOR plus 180 basis points | ||
Adjusted rate of debt | 2.98644% | ||
Parent Company | London Interbank Offered Rate (LIBOR) [Member] | 5.50% Subordinated Notes Due 2026, net of unamortized debt issuance costs | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 4.297% | ||
Parent Company | London Interbank Offered Rate (LIBOR) [Member] | Southside Statutory Trust III Due 2033, net of unamortized debt issuance costs | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 2.94% | ||
Parent Company | London Interbank Offered Rate (LIBOR) [Member] | Southside Statutory Trust IV Due 2037 | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.30% | ||
Parent Company | London Interbank Offered Rate (LIBOR) [Member] | Southside Statutory Trust V Due 2037 | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 2.25% | ||
Parent Company | London Interbank Offered Rate (LIBOR) [Member] | Magnolia Trust Company I Due 2035 | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.80% | ||
Subsidiaries | |||
Debt Instruments [Abstract] | |||
Total long-term obligations | $ 162,249,000 | 443,128,000 | |
Subsidiaries | Federal Home Loan Bank Advances | |||
Debt Instruments [Abstract] | |||
FHLB advances | [8] | $ 162,249,000 | $ 443,128,000 |
Long-term Debt, Other Disclosures [Abstract] | |||
Weighted average cost (as a percent) | 1.80% | ||
Minimum | Parent Company | Subordinated Notes | |||
Long-term Debt, Other Disclosures [Abstract] | |||
Long-term debt, remaining maturity | 1 year | ||
Variable rate advance agreements | Three-month LIBOR | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | (0.25%) | ||
Long-term Debt, Other Disclosures [Abstract] | |||
Debt instrument, description of variable rate basis | three-month LIBOR | ||
[1] | This long-term debt consists of subordinated notes with a remaining maturity greater than one year that qualify under the risk-based capital guidelines as Tier 2 capital, subject to certain limitations. | ||
[2] | This long-term debt consists of trust preferred securities that qualify under the risk-based capital guidelines as Tier 1 capital, subject to certain limitations. | ||
[3] | This debt carries a fixed rate of 5.50% through September 29, 2021 and thereafter, adjusts quarterly at a rate equal to three-month LIBOR plus 429.7 basis points. | ||
[4] | This debt carries an adjustable rate of 4.23639% through September 29, 2017 and adjusts quarterly at a rate equal to three-month LIBOR plus 294 basis points. | ||
[5] | This debt carries an adjustable rate of 2.46956% through July 29, 2017 and adjusts quarterly at a rate equal to three-month LIBOR plus 130 basis points. | ||
[6] | This debt carries an adjustable rate of 3.49556% through September 14, 2017 and adjusts quarterly at a rate equal to three-month LIBOR plus 225 basis points. | ||
[7] | This debt carries an adjustable rate of 2.98644% through August 22, 2017 and adjusts quarterly at a rate equal to three-month LIBOR plus 180 basis points. | ||
[8] | At June 30, 2017, the weighted average cost of these advances was 1.8%. Long-term FHLB advances have maturities ranging from July 2018 through July 2028. |
Long-term Obligations - Subord
Long-term Obligations - Subordinated Debt and Long-term Debt Narrative (Details) - Parent Company - USD ($) | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2017 | Dec. 31, 2016 | ||
5.50% Subordinated Notes Due 2026, net of unamortized debt issuance costs | |||
Debt Instrument [Line Items] | |||
Aggregate principal amount of subordinated notes | $ 100,000,000 | $ 100,000,000 | |
Debt instrument, fixed interest rate | 5.50% | ||
Debt instrument, description of variable rate basis | [1],[2] | three-month LIBOR plus 429.7 basis points | |
Unamortized debt issuance costs | $ 1,800,000 | 1,900,000 | |
Southside Statutory Trust III Due 2033, net of unamortized debt issuance costs | |||
Debt Instrument [Line Items] | |||
Debt instrument, description of variable rate basis | three-month LIBOR plus 294 basis points | ||
Unamortized debt issuance costs | $ 73,000 | $ 75,000 | |
[1] | This debt carries a fixed rate of 5.50% through September 29, 2021 and thereafter, adjusts quarterly at a rate equal to three-month LIBOR plus 429.7 basis points. | ||
[2] | This long-term debt consists of subordinated notes with a remaining maturity greater than one year that qualify under the risk-based capital guidelines as Tier 2 capital, subject to certain limitations. |
Long-term Obligations - Intere
Long-term Obligations - Interest Rate Swaps (Details) | 6 Months Ended | |
Jun. 30, 2017USD ($)contractagreementRate | Dec. 31, 2016USD ($) | |
Derivative [Line Items] | ||
Debt instrument, face amount | $ | $ 240,000,000 | |
Variable rate advance agreements | ||
Derivative [Line Items] | ||
Debt instrument, face amount | $ | $ 280,000,000 | $ 250,000,000 |
Three-month LIBOR | Variable rate advance agreements | ||
Derivative [Line Items] | ||
Number of variable rate advance agreements | agreement | 2 | |
Debt instrument, description of variable rate basis | three-month LIBOR | |
Basis spread on variable rate | Rate | (0.25%) | |
One-month LIBOR | Variable rate advance agreements | ||
Derivative [Line Items] | ||
Debt instrument, description of variable rate basis | one-month LIBOR | |
One-month LIBOR | Variable rate advance agreements | Minimum | ||
Derivative [Line Items] | ||
Basis spread on variable rate | Rate | 0.17% | |
One-month LIBOR | Variable rate advance agreements | Maximum | ||
Derivative [Line Items] | ||
Basis spread on variable rate | Rate | 0.278% | |
Interest rate swaps | ||
Derivative [Line Items] | ||
Derivative, instruments terminated | contract | 2 | |
Notional value of instruments terminated | $ | $ 40,000,000 | |
Interest rate swaps | Minimum | ||
Derivative [Line Items] | ||
Derivative, Fixed Interest Rate | 0.932% | |
Derivative, Term of Contract | 5 years | |
Interest rate swaps | Maximum | ||
Derivative [Line Items] | ||
Derivative, Fixed Interest Rate | 2.345% | |
Derivative, Term of Contract | 10 years |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Defined Benefit Pension Plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 341 | $ 316 | $ 699 | $ 684 |
Interest cost | 888 | 953 | 1,800 | 1,870 |
Expected return on assets | (1,513) | (1,257) | (3,025) | (2,611) |
Net loss amortization | 312 | 462 | 656 | 820 |
Prior service (credit) cost amortization | (3) | 7 | (7) | 1 |
Special and contractual termination benefits | 0 | 29 | 0 | 1,549 |
Net periodic benefit cost (income) | 25 | 510 | 123 | 2,313 |
Defined Benefit Pension Plan Acquired | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 0 | 0 | 0 | 0 |
Interest cost | 44 | 53 | 89 | 106 |
Expected return on assets | (53) | (66) | (107) | (133) |
Net loss amortization | 0 | 0 | 0 | 0 |
Prior service (credit) cost amortization | 0 | 0 | 0 | 0 |
Special and contractual termination benefits | 0 | 0 | 0 | 0 |
Net periodic benefit cost (income) | (9) | (13) | (18) | (27) |
Restoration Plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 73 | 56 | 124 | 103 |
Interest cost | 151 | 133 | 283 | 268 |
Expected return on assets | 0 | 0 | 0 | 0 |
Net loss amortization | 104 | 40 | 151 | 93 |
Prior service (credit) cost amortization | 1 | 1 | 3 | 3 |
Special and contractual termination benefits | 0 | 0 | 0 | 0 |
Net periodic benefit cost (income) | $ 329 | $ 230 | $ 561 | $ 467 |
Share-based Incentive Plans - N
Share-based Incentive Plans - Narrative (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | $ 419,000 | $ 403,000 | $ 913,000 | $ 758,000 |
Incentive Plan 2017 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares authorized | 2,050,000 | 2,050,000 | ||
Incentive Plan 2017 | Nonqualified Stock Options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Granted (shares) | 0 | |||
Incentive Plan 2017 | Restricted Stock Units (RSUs) | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Granted (shares) | 0 | |||
Incentive Plan 2009 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of additional shares | 410,000 | 410,000 | ||
Incentive Plan 2009 | Nonqualified Stock Options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Granted (shares) | 87,474 | |||
Weighted average exercise price (in dollars per share) | $ 25.97 | |||
Contractual terms | 10 years | |||
Incentive Plan 2009 | Nonqualified Stock Options | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 3 years | |||
Incentive Plan 2009 | Nonqualified Stock Options | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 4 years | |||
Incentive Plan 2009 | Restricted Stock Units (RSUs) | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Granted (shares) | 18,315 | |||
Fair value of shares granted | $ 486,000 | |||
Incentive Plan 2009 | Restricted Stock Units (RSUs) | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 3 years | |||
Incentive Plan 2009 | Restricted Stock Units (RSUs) | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 4 years |
Share-based Incentive Plans - S
Share-based Incentive Plans - Schedule of Shares Issued in Connection With Stock Compensation Awards (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
New shares issued (in shares) | 26,482 | 18,256 | 60,078 | 23,168 |
Proceeds from stock option exercises | $ 383 | $ 159 | $ 1,022 | $ 194 |
New shares issued from available authorized shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
New shares issued (in shares) | 14,715 | 18,256 | 48,311 | 23,168 |
New shares issued from available treasury shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
New shares issued (in shares) | 11,767 | 0 | 11,767 | 0 |
Derivative Financial Instrume65
Derivative Financial Instruments and Hedging Activities - Narrative (Details) - USD ($) | Jun. 30, 2017 | Dec. 31, 2016 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Debt instrument, face amount | $ 240,000,000 | |
Derivative Asset, Collateral, Obligation to Return Cash, Offset | 4,760,000 | $ 7,154,000 |
Collateral Already Posted, Aggregate Fair Value | 1,147,000 | |
Derivative, Collateral, Obligation to Return Cash | $ 553,000 |
Derivative Financial Instrume66
Derivative Financial Instruments and Hedging Activities - Schedule Of Derivative Instruments (Details) - USD ($) | Jun. 30, 2017 | Dec. 31, 2016 | |
Asset Derivative | |||
Gross derivatives | $ 7,487,000 | $ 7,154,000 | |
Offsetting derivative assets | (420,000) | 0 | |
Cash collateral received/posted | (4,760,000) | (7,154,000) | |
Net derivatives included in the consolidated balance sheets | [1] | 2,307,000 | 0 |
Liability Derivative | |||
Gross derivatives | 1,642,000 | 85,000 | |
Offsetting derivative liabilities | (420,000) | 0 | |
Cash collateral received/posted | (1,146,000) | 0 | |
Net derivatives included in the consolidated balance sheets | [1] | 76,000 | 85,000 |
Financial Institution Counterparties | |||
Liability Derivative | |||
Net credit exposure | 1,638,000 | 0 | |
Financial Institution Counterparties | Designated as Hedging Instrument | Cash Flow Hedging | Interest Rate Swap | |||
Derivatives, Fair Value [Line Items] | |||
Notional Amount | [2] | 240,000,000 | 250,000,000 |
Asset Derivative | |||
Gross derivatives | 6,189,000 | 7,069,000 | |
Liability Derivative | |||
Gross derivatives | 344,000 | 0 | |
Financial Institution Counterparties | Not Designated as Hedging Instrument | Interest Rate Swap | |||
Derivatives, Fair Value [Line Items] | |||
Notional Amount | [2] | 67,942,000 | 2,182,000 |
Asset Derivative | |||
Gross derivatives | 76,000 | 85,000 | |
Liability Derivative | |||
Gross derivatives | 1,222,000 | 0 | |
Customer Counterparties | |||
Liability Derivative | |||
Net credit exposure | 1,222,000 | 0 | |
Customer Counterparties | Not Designated as Hedging Instrument | Interest Rate Swap | |||
Derivatives, Fair Value [Line Items] | |||
Notional Amount | [2] | 67,942,000 | 2,182,000 |
Asset Derivative | |||
Gross derivatives | 1,222,000 | 0 | |
Liability Derivative | |||
Gross derivatives | $ 76,000 | $ 85,000 | |
[1] | Net derivative assets are included in “other assets” and net derivative liabilities are included in “other liabilities” on the consolidated balance sheets. Included in the fair value of net derivative assets and net derivative liabilities are credit valuation adjustments reflecting counterparty credit risk and our credit risk. We had net credit exposure of $1.6 million related to interest rate swaps with financial institutions and $1.2 million related to interest rate swaps with customers at June 30, 2017. The credit risk associated with customer transactions is partially mitigated as these transactions are generally secured by the non-cash collateral securing the underlying transaction being hedged. We had no credit exposure related to interest rate swaps with financial or customer counterparties at December 31, 2016. | ||
[2] | Notional amounts, which represent the extent of involvement in the derivatives market, are used to determine the contractual cash flows required in accordance with the terms of the agreement. These amounts are typically not exchanged, significantly exceed amounts subject to credit or market risk, and are not reflected in the consolidated balance sheets. |
Derivative Financial Instrume67
Derivative Financial Instruments and Hedging Activities - Weighted Average Remaining Maturity, Lives, and Rates of Interest Rate Swaps (Details) - Interest Rate Swap - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2017 | Dec. 31, 2016 | ||
Financial Institution Counterparties | Not Designated as Hedging Instrument | |||
Derivative [Line Items] | |||
Notional Amount | [1] | $ 67,942 | $ 2,182 |
Remaining Maturity (in years) | 13 years 2 months 22 days | 9 years 8 months | |
Weighted Average Receive Rate | 1.04% | 0.62% | |
Weighted Average Pay Rate | 2.37% | 1.57% | |
Financial Institution Counterparties | Cash Flow Hedging | Designated as Hedging Instrument | |||
Derivative [Line Items] | |||
Notional Amount | [1] | $ 240,000 | $ 250,000 |
Remaining Maturity (in years) | 5 years 9 months 19 days | 5 years 5 months 6 days | |
Weighted Average Receive Rate | 1.14% | 0.68% | |
Weighted Average Pay Rate | 1.43% | 1.31% | |
Customer Counterparties | Not Designated as Hedging Instrument | |||
Derivative [Line Items] | |||
Notional Amount | [1] | $ 67,942 | $ 2,182 |
Remaining Maturity (in years) | 13 years 2 months 22 days | 9 years 8 months | |
Weighted Average Receive Rate | 2.37% | 1.57% | |
Weighted Average Pay Rate | 1.04% | 0.62% | |
[1] | Notional amounts, which represent the extent of involvement in the derivatives market, are used to determine the contractual cash flows required in accordance with the terms of the agreement. These amounts are typically not exchanged, significantly exceed amounts subject to credit or market risk, and are not reflected in the consolidated balance sheets. |
Fair Value Measurement - Fair
Fair Value Measurement - Fair Value Measurements, Recurring and Nonrecurring Basis (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | $ 5,954 | $ 75,989 | |
Total liability recurring fair value measurements | 0 | 0 | |
Total asset nonrecurring fair value measurements | 0 | 0 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Foreclosed assets | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset nonrecurring fair value measurements | 0 | 0 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Impaired loans | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset nonrecurring fair value measurements | [1] | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Interest rate swaps | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 0 | 0 | |
Total liability recurring fair value measurements | 0 | 0 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | U.S. Treasury | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 70,069 | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) | State and Political Subdivisions | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 0 | 0 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Other Stocks and Bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 0 | 0 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Other Equity Securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 5,954 | 5,920 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Residential MBS | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | [2] | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Commercial MBS | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | [2] | 0 | 0 |
Significant Other Observable Inputs (Level 2) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 1,399,344 | 1,410,765 | |
Total liability recurring fair value measurements | 1,642 | 85 | |
Total asset nonrecurring fair value measurements | 0 | 0 | |
Significant Other Observable Inputs (Level 2) | Foreclosed assets | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset nonrecurring fair value measurements | 0 | 0 | |
Significant Other Observable Inputs (Level 2) | Impaired loans | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset nonrecurring fair value measurements | [1] | 0 | 0 |
Significant Other Observable Inputs (Level 2) | Interest rate swaps | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 7,487 | 7,154 | |
Total liability recurring fair value measurements | 1,642 | 85 | |
Significant Other Observable Inputs (Level 2) | U.S. Treasury | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 0 | ||
Significant Other Observable Inputs (Level 2) | State and Political Subdivisions | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 326,159 | 385,197 | |
Significant Other Observable Inputs (Level 2) | Other Stocks and Bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 5,144 | 6,651 | |
Significant Other Observable Inputs (Level 2) | Other Equity Securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 0 | 0 | |
Significant Other Observable Inputs (Level 2) | Residential MBS | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | [2] | 654,104 | 627,508 |
Significant Other Observable Inputs (Level 2) | Commercial MBS | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | [2] | 406,450 | 384,255 |
Significant Unobservable Inputs (Level 3) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 0 | 0 | |
Total liability recurring fair value measurements | 0 | 0 | |
Total asset nonrecurring fair value measurements | 7,032 | 10,081 | |
Significant Unobservable Inputs (Level 3) | Foreclosed assets | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset nonrecurring fair value measurements | 247 | 388 | |
Significant Unobservable Inputs (Level 3) | Impaired loans | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset nonrecurring fair value measurements | [1] | 6,785 | 9,693 |
Significant Unobservable Inputs (Level 3) | Interest rate swaps | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 0 | 0 | |
Total liability recurring fair value measurements | 0 | 0 | |
Significant Unobservable Inputs (Level 3) | U.S. Treasury | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 0 | ||
Significant Unobservable Inputs (Level 3) | State and Political Subdivisions | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 0 | 0 | |
Significant Unobservable Inputs (Level 3) | Other Stocks and Bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 0 | 0 | |
Significant Unobservable Inputs (Level 3) | Other Equity Securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 0 | 0 | |
Significant Unobservable Inputs (Level 3) | Residential MBS | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | [2] | 0 | 0 |
Significant Unobservable Inputs (Level 3) | Commercial MBS | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | [2] | 0 | 0 |
Carrying Amount | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 1,405,298 | 1,486,754 | |
Total liability recurring fair value measurements | 1,642 | 85 | |
Total asset nonrecurring fair value measurements | 7,032 | 10,081 | |
Carrying Amount | Foreclosed assets | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset nonrecurring fair value measurements | 247 | 388 | |
Carrying Amount | Impaired loans | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset nonrecurring fair value measurements | [1] | 6,785 | 9,693 |
Carrying Amount | Interest rate swaps | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 7,487 | 7,154 | |
Total liability recurring fair value measurements | 1,642 | 85 | |
Carrying Amount | U.S. Treasury | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 70,069 | ||
Carrying Amount | State and Political Subdivisions | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 326,159 | 385,197 | |
Carrying Amount | Other Stocks and Bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 5,144 | 6,651 | |
Carrying Amount | Other Equity Securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | 5,954 | 5,920 | |
Carrying Amount | Residential MBS | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | [2] | 654,104 | 627,508 |
Carrying Amount | Commercial MBS | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total asset recurring fair value measurements | [2] | $ 406,450 | $ 384,255 |
[1] | Impaired loans represent collateral-dependent loans with a specific valuation allowance. Losses on these loans represent charge-offs which are netted against the allowance for loan losses. | ||
[2] | All mortgage-backed securities are issued and/or guaranteed by U.S. government agencies or U.S. government-sponsored enterprises. |
Fair Value Measurement - Fai69
Fair Value Measurement - Fair Value, Balance Sheet Grouping (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Level 1 | ||
Financial Assets: | ||
Cash and cash equivalents | $ 235,832 | $ 169,654 |
Investment Securities: | ||
Held to maturity, at carrying value | 0 | 0 |
Mortgage-backed Securities: | ||
Held to maturity, at carrying value | 0 | 0 |
FHLB stock, at cost, and other investments | 0 | 0 |
Loans, net of allowance for loan losses | 0 | 0 |
Loans held for sale | 0 | 0 |
Financial Liabilities: | ||
Deposits | 0 | 0 |
Federal funds purchased and repurchase agreements | 0 | 0 |
FHLB advances | 0 | 0 |
Subordinated notes | 0 | 0 |
Long-term debt, net of unamortized debt issuance costs | 0 | 0 |
Level 2 | ||
Financial Assets: | ||
Cash and cash equivalents | 0 | 0 |
Investment Securities: | ||
Held to maturity, at carrying value | 430,155 | 429,912 |
Mortgage-backed Securities: | ||
Held to maturity, at carrying value | 513,621 | 514,370 |
FHLB stock, at cost, and other investments | 66,985 | 66,592 |
Loans, net of allowance for loan losses | 0 | 0 |
Loans held for sale | 3,036 | 7,641 |
Financial Liabilities: | ||
Deposits | 3,620,875 | 3,293,352 |
Federal funds purchased and repurchase agreements | 8,424 | 7,097 |
FHLB advances | 1,172,459 | 1,331,517 |
Subordinated notes | 102,771 | 101,627 |
Long-term debt, net of unamortized debt issuance costs | 47,897 | 45,147 |
Level 3 | ||
Financial Assets: | ||
Cash and cash equivalents | 0 | 0 |
Investment Securities: | ||
Held to maturity, at carrying value | 0 | 0 |
Mortgage-backed Securities: | ||
Held to maturity, at carrying value | 0 | 0 |
FHLB stock, at cost, and other investments | 0 | 0 |
Loans, net of allowance for loan losses | 2,603,697 | 2,630,009 |
Loans held for sale | 0 | 0 |
Financial Liabilities: | ||
Deposits | 0 | 0 |
Federal funds purchased and repurchase agreements | 0 | 0 |
FHLB advances | 0 | 0 |
Subordinated notes | 0 | 0 |
Long-term debt, net of unamortized debt issuance costs | 0 | 0 |
Carrying Amount | ||
Financial Assets: | ||
Cash and cash equivalents | 235,832 | 169,654 |
Investment Securities: | ||
Held to maturity, at carrying value | 419,825 | 425,810 |
Mortgage-backed Securities: | ||
Held to maturity, at carrying value | 505,713 | 511,677 |
FHLB stock, at cost, and other investments | 66,985 | 66,592 |
Loans, net of allowance for loan losses | 2,590,957 | 2,538,626 |
Loans held for sale | 3,036 | 7,641 |
Financial Liabilities: | ||
Deposits | 3,624,073 | 3,533,076 |
Federal funds purchased and repurchase agreements | 8,424 | 7,097 |
FHLB advances | 1,178,082 | 1,309,646 |
Subordinated notes | 98,171 | 98,100 |
Long-term debt, net of unamortized debt issuance costs | 60,238 | 60,236 |
Estimated Fair Value | ||
Financial Assets: | ||
Cash and cash equivalents | 235,832 | 169,654 |
Investment Securities: | ||
Held to maturity, at carrying value | 430,155 | 429,912 |
Mortgage-backed Securities: | ||
Held to maturity, at carrying value | 513,621 | 514,370 |
FHLB stock, at cost, and other investments | 66,985 | 66,592 |
Loans, net of allowance for loan losses | 2,603,697 | 2,630,009 |
Loans held for sale | 3,036 | 7,641 |
Financial Liabilities: | ||
Deposits | 3,620,875 | 3,293,352 |
Federal funds purchased and repurchase agreements | 8,424 | 7,097 |
FHLB advances | 1,172,459 | 1,331,517 |
Subordinated notes | 102,771 | 101,627 |
Long-term debt, net of unamortized debt issuance costs | $ 47,897 | $ 45,147 |
Income Taxes - Provision for I
Income Taxes - Provision for Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Income Tax Disclosure [Abstract] | ||||
Current income tax expense | $ 3,317 | $ 1,454 | $ 6,344 | $ 5,239 |
Deferred income tax (benefit) expense | 36 | 1,318 | 17 | 506 |
Income tax expense | $ 3,353 | $ 2,772 | $ 6,361 | $ 5,745 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |||||
Net deferred tax assets | $ 22,400,000 | $ 22,400,000 | $ 28,900,000 | ||
Deferred tax assets, valuation allowance | 0 | 0 | $ 0 | ||
Income tax expense | $ 3,353,000 | $ 2,772,000 | $ 6,361,000 | $ 5,745,000 | |
Effective income tax rate, percent | 18.80% | 19.60% | 17.80% | 18.70% | |
Income tax expense (benefit) related to excess tax benefit on share-based compensation | $ 84,000 | $ 210,000 | |||
ETR, discrete tax increase (decrease), percent | 0.50% | 0.60% |
Off-Balance-Sheet Arrangement72
Off-Balance-Sheet Arrangements, Commitments and Contingencies (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Financial instruments with off-balance-sheet risk, at fair value | $ 703,303 | $ 674,738 |
Commitments to extend credit | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Financial instruments with off-balance-sheet risk, at fair value | 693,485 | 665,663 |
Standby letters of credit | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Financial instruments with off-balance-sheet risk, at fair value | $ 9,818 | $ 9,075 |
Off-Balance-Sheet Arrangement73
Off-Balance-Sheet Arrangements, Commitments and Contingencies Narrative (Details) - USD ($) | Jun. 30, 2017 | Dec. 31, 2016 | Jun. 30, 2016 |
Securities: | |||
Unsettled trades to purchase securities | $ 24,883,000 | $ 160,000 | $ 11,793,000 |
Unsettled trades to sell securities | 0 | 0 | |
Deposits: | |||
Unsettled issuances of brokered certificates of deposit | $ 0 | $ 0 |