Fair Value of Assets and liabilities (Tables)
|
12 Months Ended |
Dec. 31, 2020 |
|---|
| Fair Value Disclosures [Abstract] |
|
| Summary of Assets and Liabilities Measured at Fair Value on a Recurring Basis |
Equity investments were recorded at cost less impairment plus or minus observable price changes. Commencing in 2020, the Company elected to measure equity investments at fair value on a non-recurring basis, which have been adjusted for all periods presented.
The following tables present the Company’s fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis as of December 31, 2020 and 2019.
|
December 31, 2020
(Dollars in thousands) |
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
|
Total |
|
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing deposits |
|
$ |
— |
|
|
$ |
1,500 |
|
|
$ |
— |
|
|
$ |
1,500 |
|
|
Available for sale investment securities |
|
|
— |
|
|
|
46,792 |
|
|
|
— |
|
|
|
46,792 |
|
|
Total(1) |
|
$ |
— |
|
|
$ |
48,292 |
|
|
$ |
— |
|
|
$ |
48,292 |
|
|
(1) |
Total unrealized gains of $1,013, net of tax, was included in accumulated other comprehensive income (loss) for the twelve months ended December 31, 2020 related to these assets. |
|
December 31, 2019
(Dollars in thousands) |
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
|
Total |
|
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available for sale investment securities (1) |
|
$ |
— |
|
|
$ |
48,998 |
|
|
$ |
— |
|
|
$ |
48,998 |
|
|
Total |
|
$ |
— |
|
|
$ |
48,998 |
|
|
$ |
— |
|
|
$ |
48,998 |
|
|
(1) |
Total unrealized gains of $1,081, net of tax, was included in accumulated other comprehensive income (loss) for the twelve months ended December 31, 2019 related to these assets. |
|
| Summary of Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis |
The following tables present the Company’s fair value hierarchy for those assets and liabilities measured at fair value on a non-recurring basis as of December 31, 2020 and 2019.
|
December 31, 2020
(Dollars in thousands) |
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
|
Total |
|
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity investments |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
9,746 |
|
|
$ |
9,746 |
|
|
Impaired loans |
|
|
— |
|
|
|
— |
|
|
|
62,174 |
|
|
|
62,174 |
|
|
Loan collateral in process of foreclosure |
|
|
— |
|
|
|
— |
|
|
|
54,560 |
|
|
|
54,560 |
|
|
Total |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
126,480 |
|
|
$ |
126,480 |
|
|
December 31, 2019
(Dollars in thousands) |
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
|
Total |
|
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity investments |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
10,079 |
|
|
$ |
10,079 |
|
|
Impaired loans |
|
|
— |
|
|
|
— |
|
|
|
34,915 |
|
|
|
34,915 |
|
|
Loan collateral in process of foreclosure |
|
|
— |
|
|
|
— |
|
|
|
52,711 |
|
|
|
52,711 |
|
|
Total |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
97,705 |
|
|
$ |
97,705 |
|
|
| Summary of Valuation Techniques and Significant Unobservable Inputs Used in Non-Recurring Level 3 Fair Value Measurements of Assets and Liabilities |
The valuation techniques and significant unobservable inputs used in non-recurring level 3 fair value measurements of assets and liabilities as of December 31, 2020 and 2019.
|
(Dollars in thousands) |
|
Fair Value
at 12/31/20 |
|
|
Valuation Techniques |
|
Unobservable Inputs |
|
Range
(Weighted Average) |
|
Equity investments |
|
$ |
8,291 |
|
|
Investee financial analysis |
|
Financial condition and operating performance of the borrower (1) |
|
N/A |
|
|
|
|
|
|
|
|
|
Collateral support |
|
N/A |
|
|
|
|
1,455 |
|
|
Precedent market transaction |
|
Offering price |
|
$8.73 / share |
|
Impaired loans |
|
|
62,174 |
|
|
Market approach |
|
Historical and actual loss experience |
|
1.50% - 6.00% |
|
|
|
|
|
|
|
|
|
|
|
60% of balance |
|
|
|
|
|
|
|
|
|
Median transfer price (2) |
|
$0.6 - 108.7 |
|
|
|
|
|
|
|
|
|
Collateral value |
|
N/A |
|
Loan collateral in process of foreclosure |
|
|
53,128 |
|
|
Market approach |
|
Median transfer price (2) |
|
$0.6 - 108.7 |
|
|
|
|
1,432 |
|
|
|
|
Collateral value (3) |
|
$0.7 - 32.3 |
|
(1) |
Includes projections based on revenue, EBITDA, leverage and liquidation amounts. These assumptions are based on a variety of factors, including economic conditions, industry and market developments, market valuations of comparable companies, and company-specific developments, including exit strategies and realization opportunities. |
|
(2) |
Represents amount net of liquidation costs. |
|
(3) |
Relates to the recreation portfolio. |
|
(Dollars in thousands) |
|
Fair Value
at 12/31/19 |
|
|
Valuation Techniques |
|
Unobservable Inputs |
|
Range
(Weighted Average) |
|
Equity Investments |
|
$ |
7,435 |
|
|
Investee financial analysis |
|
Financial condition and operating performance of the borrower |
|
N/A |
|
|
|
|
|
|
|
|
|
Collateral support |
|
N/A |
|
|
|
|
1,189 |
|
|
Investee book value adjusted for market appreciation |
|
Financial condition and operating performance of the investee |
|
N/A |
|
|
|
|
|
|
|
Public company comparables |
|
Business enterprise value |
|
$4,855 – $6,120 |
|
|
|
|
|
|
|
|
|
Business enterprise value/revenue multiples |
|
1.59-5.98x |
|
|
|
|
|
|
|
|
|
Discount for lack of marketability |
|
25% |
|
|
|
|
1,455 |
|
|
Precedent market transaction |
|
Offering price |
|
$8.73 / share |
|