DELAWARE | 33-0743196 |
(State or other jurisdiction of incorporation or organization) | (I.R.S Employer Identification No.) |
Large accelerated filer | [X] | Accelerated filer | [ ] | Non-accelerated filer (Do not check if a smaller reporting company) | [ ] | Smaller reporting company | [ ] | Emerging growth company | [ ] |
Title of Each Class | Trading Symbol | Name of Each Exchange on Which Registered |
Common Stock, par value $0.01 per share | PPBI | NASDAQ Stock Market |
ASSETS | March 31, 2019 | December 31, 2018 | ||||||
Cash and due from banks | $ | $ | ||||||
Interest-bearing deposits with financial institutions | ||||||||
Cash and cash equivalents | ||||||||
Interest-bearing time deposits with financial institutions | ||||||||
Investments held-to-maturity, at amortized cost (fair value of $43,980 and $44,672 as of March 31, 2019 and December 31, 2018, respectively) | ||||||||
Investment securities available-for-sale, at fair value | ||||||||
FHLB, FRB and other stock, at cost | ||||||||
Loans held for sale, at lower of cost or fair value | ||||||||
Loans held for investment | ||||||||
Allowance for loan losses | ( | ) | ( | ) | ||||
Loans held for investment, net | ||||||||
Accrued interest receivable | ||||||||
Other real estate owned | ||||||||
Premises and equipment | ||||||||
Deferred income taxes, net | ||||||||
Bank owned life insurance | ||||||||
Intangible assets | ||||||||
Goodwill | ||||||||
Other assets | ||||||||
Total assets | $ | $ | ||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
LIABILITIES | ||||||||
Deposit accounts: | ||||||||
Noninterest-bearing checking | $ | $ | ||||||
Interest-bearing: | ||||||||
Checking | ||||||||
Money market/savings | ||||||||
Retail certificates of deposit | ||||||||
Wholesale/brokered certificates of deposit | ||||||||
Total interest-bearing | ||||||||
Total deposits | ||||||||
FHLB advances and other borrowings | ||||||||
Subordinated debentures | ||||||||
Accrued expenses and other liabilities | ||||||||
Total liabilities | ||||||||
STOCKHOLDERS’ EQUITY | ||||||||
Preferred stock, $.01 par value; 1,000,000 authorized; none issued and outstanding | ||||||||
Common stock, $.01 par value; 150,000,000 shares authorized at March 31, 2019 and December 31, 2018; 62,773,299 shares 62,480,755 shares issued and outstanding, respectively. | ||||||||
Additional paid-in capital | ||||||||
Retained earnings | ||||||||
Accumulated other comprehensive income (loss) | ( | ) | ||||||
Total stockholders’ equity | ||||||||
Total liabilities and stockholders’ equity | $ | $ | ||||||
Three Months Ended | ||||||||||||
March 31, | December 31, | March 31, | ||||||||||
2019 | 2018 | 2018 | ||||||||||
INTEREST INCOME | ||||||||||||
Loans | $ | $ | $ | |||||||||
Investment securities and other interest-earning assets | ||||||||||||
Total interest income | ||||||||||||
INTEREST EXPENSE | ||||||||||||
Deposits | ||||||||||||
FHLB advances and other borrowings | ||||||||||||
Subordinated debentures | ||||||||||||
Total interest expense | ||||||||||||
Net interest income before provision for credit losses | ||||||||||||
Provision for credit losses | ||||||||||||
Net interest income after provision for credit losses | ||||||||||||
NONINTEREST INCOME | ||||||||||||
Loan servicing fees | ||||||||||||
Service charges on deposit accounts | ||||||||||||
Other service fee income | ||||||||||||
Debit card interchange fee income | ||||||||||||
Earnings on bank-owned life insurance | ||||||||||||
Net gain from sales of loans | ||||||||||||
Net gain from sales of investment securities | ||||||||||||
Other income | ||||||||||||
Total noninterest income | ||||||||||||
NONINTEREST EXPENSE | ||||||||||||
Compensation and benefits | ||||||||||||
Premises and occupancy | ||||||||||||
Data processing | ||||||||||||
Other real estate owned operations, net | ||||||||||||
FDIC insurance premiums | ||||||||||||
Legal, audit and professional expense | ||||||||||||
Marketing expense | ||||||||||||
Office, telecommunications and postage expense | ||||||||||||
Loan expense | ||||||||||||
Deposit expense | ||||||||||||
Merger-related expense | ||||||||||||
CDI amortization | ||||||||||||
Other expense | ||||||||||||
Total noninterest expense | ||||||||||||
Net income before income taxes | ||||||||||||
Income tax | ||||||||||||
Net income | $ | $ | $ | |||||||||
EARNINGS PER SHARE | ||||||||||||
Basic | $ | $ | $ | |||||||||
Diluted | ||||||||||||
WEIGHTED AVERAGE SHARES OUTSTANDING | ||||||||||||
Basic | ||||||||||||
Diluted | ||||||||||||
Three Months Ended | ||||||||||||
March 31, | December 31, | March 31, | ||||||||||
2019 | 2018 | 2018 | ||||||||||
Net income | $ | $ | $ | |||||||||
Other comprehensive income, net of tax: | ||||||||||||
Unrealized holding gain (loss) on securities available-for-sale arising during the period, net of income taxes (1) | ( | ) | ||||||||||
Reclassification adjustment for net gain on sale of securities included in net income, net of income taxes (2) | ( | ) | ( | ) | ||||||||
Other comprehensive income (loss), net of tax | ( | ) | ||||||||||
Comprehensive income, net of tax | $ | $ | $ |
Common Stock Shares | Common Stock | Additional Paid-in Capital | Accumulated Retained Earnings | Accumulated Other Comprehensive (Loss) Income | Total Stockholders’ Equity | |||||||||||||||||
Balance at December 31, 2018 | $ | $ | $ | $ | ( | ) | $ | |||||||||||||||
Net income | — | — | — | — | ||||||||||||||||||
Other comprehensive income | — | — | — | — | ||||||||||||||||||
Cash dividends declared ($0.22 per common share) | — | — | — | ( | ) | — | ( | ) | ||||||||||||||
Dividend equivalents declared ($0.22 per restricted stock units) | — | — | ( | ) | — | |||||||||||||||||
Share-based compensation expense | — | — | — | — | ||||||||||||||||||
Issuance of restricted stock, net | — | — | — | — | ||||||||||||||||||
Restricted stock surrendered and canceled | ( | ) | — | ( | ) | — | — | ( | ) | |||||||||||||
Exercise of stock options | — | — | — | |||||||||||||||||||
Balance at March 31, 2019 | $ | $ | $ | $ | $ | |||||||||||||||||
Balance at December 31, 2017 | $ | $ | $ | $ | $ | |||||||||||||||||
Net income | — | — | — | — | ||||||||||||||||||
Other comprehensive income | — | — | — | — | ( | ) | ( | ) | ||||||||||||||
Share-based compensation expense | — | — | — | — | ||||||||||||||||||
Issuance of restricted stock, net | — | — | — | — | — | |||||||||||||||||
Restricted stock surrendered and canceled | ( | ) | — | ( | ) | — | — | ( | ) | |||||||||||||
Exercise of stock options | — | — | ||||||||||||||||||||
Reclassification of certain tax effects of the Tax Cuts and Jobs Act | — | — | — | ( | ) | |||||||||||||||||
Balance at March 31, 2018 | $ | $ | $ | $ | ( | ) | $ |
Three Months Ended | ||||||||
March 31, | ||||||||
2019 | 2018 | |||||||
Cash flows from operating activities: | ||||||||
Net income | $ | $ | ||||||
Adjustments to net income: | ||||||||
Depreciation and amortization expense | ||||||||
Provision for credit losses | ||||||||
Share-based compensation expense | ||||||||
Loss on sale and disposal of premises and equipment | ||||||||
Loss on sale of or write down of other real estate owned | ||||||||
Net amortization on securities | ||||||||
Net accretion of deferred loan fees/costs and discounts/premiums for loans acquired | ( | ) | ||||||
Gain on sale of investment securities available-for-sale | ( | ) | ( | ) | ||||
Originations of loans held for sale | ( | ) | ( | ) | ||||
Proceeds from the sales of and principal payments from loans held for sale | ||||||||
Gain on sale of loans | ( | ) | ( | ) | ||||
Deferred income tax expense | ||||||||
Change in accrued expenses and other liabilities, net | ( | ) | ( | ) | ||||
Income from bank owned life insurance, net | ( | ) | ( | ) | ||||
Amortization of core deposit intangible | ||||||||
Change in accrued interest receivable and other assets, net | ||||||||
Net cash provided by operating activities | ||||||||
Cash flows from investing activities: | ||||||||
Net decrease in interest-bearing time deposits with financial institutions | ||||||||
Proceeds from sale of other real estate owned | ||||||||
Increase in loans, net | ( | ) | ( | ) | ||||
Purchase of held-to-maturity securities | ( | ) | ||||||
Principal payments on held-to-maturity securities | ||||||||
Purchase of securities available-for-sale | ( | ) | ( | ) | ||||
Principal payments on securities available-for-sale | ||||||||
Proceeds from sale or maturity of securities available-for-sale | ||||||||
Proceeds from the sale of premises and equipment | ||||||||
Proceeds from bank owned life insurance death benefit | ||||||||
Purchases of premises and equipment | ( | ) | ( | ) | ||||
Change in FHLB, FRB, and other stock, at cost | ( | ) | ||||||
Net cash used in investing activities | ( | ) | ( | ) | ||||
Cash flows from financing activities: | ||||||||
Net increase in deposit accounts | ||||||||
Net change in short-term borrowings | ( | ) | ( | ) | ||||
Repayment of long-term FHLB borrowings | ( | ) | ( | ) | ||||
Cash dividends paid | ( | ) | ||||||
Proceeds from exercise of stock options and warrants | ||||||||
Restricted stock surrendered and canceled | ( | ) | ( | ) | ||||
Net cash (used in) provided by financing activities | ( | ) | ||||||
Net decrease in cash and cash equivalents | ( | ) | ( | ) | ||||
Cash and cash equivalents, beginning of period | ||||||||
Cash and cash equivalents, end of period | $ | $ | ||||||
Supplemental cash flow disclosures: | ||||||||
Interest paid | $ | $ | ||||||
Income taxes paid | ||||||||
Noncash investing activities during the period: | ||||||||
Transfers from loans to other real estate owned | ||||||||
Receivable on unsettled security sales | ||||||||
Due on unsettled security purchases | ( | ) | ||||||
Initial recognition of operating lease right-of-use assets | ( | ) | ||||||
Initial recognition of operating lease liabilities |
• | The amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy |
• | The policy for timing of transfers between levels |
• | The valuation processes for Level 3 fair value measurements |
• | The amendments clarify that the measurement uncertainty disclosure is to communicate information about the uncertainty in measurement as of the reporting date |
• | The changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period |
• | The range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. For certain unobservable inputs, an entity may disclose other quantitative information (such as the median or arithmetic average) in lieu of the weighted average if the entity determines that other quantitative information would be a more reasonable and rational method to reflect the distribution of unobservable inputs used to develop Level 3 fair value measurements |
Grandpoint Book Value | Fair Value Adjustments | Fair Value | |||||||||
ASSETS ACQUIRED | (dollars in thousands) | ||||||||||
Cash and cash equivalents | $ | $ | $ | ||||||||
Investment securities | ( | ) | |||||||||
Loans, gross | ( | ) | |||||||||
Allowance for loan losses | ( | ) | |||||||||
Fixed assets | |||||||||||
Core deposit intangible | |||||||||||
Deferred tax assets | ( | ) | |||||||||
Other assets | ( | ) | |||||||||
Total assets acquired | $ | $ | $ | ||||||||
LIABILITIES ASSUMED | |||||||||||
Deposits | $ | $ | $ | ||||||||
Borrowings | ( | ) | |||||||||
Other liabilities | |||||||||||
Total liabilities assumed | |||||||||||
Excess of assets acquired over liabilities assumed | $ | $ | |||||||||
Consideration paid | |||||||||||
Goodwill recognized | $ |
Grandpoint Acquired Loans | |||
(dollars in thousands) | |||
Contractual amounts due | $ | ||
Cash flows not expected to be collected | |||
Expected cash flows | |||
Interest component of expected cash flows | |||
Fair value of acquired loans | $ |
Three Months Ended | |||||||||||
March 31, | December 31, | March 31, | |||||||||
2019 | 2018 | 2018 | |||||||||
(dollars in thousands) | |||||||||||
Net interest and other income | $ | $ | $ | ||||||||
Net income | |||||||||||
Basic earnings per share | |||||||||||
Diluted earnings per share |
March 31, 2019 | ||||||||||||||||
Amortized Cost | Unrealized Gain | Unrealized Loss | Estimated Fair Value | |||||||||||||
(dollars in thousands) | ||||||||||||||||
Investment securities available-for-sale: | ||||||||||||||||
U.S. Treasury | $ | $ | $ | $ | ||||||||||||
Agency | ( | ) | ||||||||||||||
Corporate | ( | ) | ||||||||||||||
Municipal bonds | ( | ) | ||||||||||||||
Collateralized mortgage obligation: residential | ( | ) | ||||||||||||||
Mortgage-backed securities: residential | ( | ) | ||||||||||||||
Total investment securities available-for-sale | ( | ) | ||||||||||||||
Investment securities held-to-maturity: | ||||||||||||||||
Mortgage-backed securities: residential | ( | ) | ||||||||||||||
Other | ||||||||||||||||
Total investment securities held-to-maturity | ( | ) | ||||||||||||||
Total investment securities | $ | $ | $ | ( | ) | $ |
December 31, 2018 | ||||||||||||||||
Amortized Cost | Unrealized Gain | Unrealized Loss | Estimated Fair Value | |||||||||||||
(dollars in thousands) | ||||||||||||||||
Investment securities available-for-sale: | ||||||||||||||||
U.S. Treasury | $ | $ | $ | $ | ||||||||||||
Agency | ( | ) | ||||||||||||||
Corporate | ( | ) | ||||||||||||||
Municipal bonds | ( | ) | ||||||||||||||
Collateralized mortgage obligation: residential | ( | ) | ||||||||||||||
Mortgage-backed securities: residential | ( | ) | ||||||||||||||
Total investment securities available-for-sale | ( | ) | ||||||||||||||
Investment securities held-to-maturity: | ||||||||||||||||
Mortgage-backed securities: residential | ( | ) | ||||||||||||||
Other | ||||||||||||||||
Total investment securities held-to-maturity | ( | ) | ||||||||||||||
Total investment securities | $ | $ | $ | ( | ) | $ |
March 31, 2019 | ||||||||||||||||||||||||||||||||
Less than 12 Months | 12 Months or Longer | Total | ||||||||||||||||||||||||||||||
Number | Fair Value | Gross Unrealized Holding Losses | Number | Fair Value | Gross Unrealized Holding Losses | Number | Fair Value | Gross Unrealized Holding Losses | ||||||||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||||||||||||
Investment securities available-for-sale: | ||||||||||||||||||||||||||||||||
Agency | $ | $ | ( | ) | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||||||||||||||
Corporate | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
Municipal bonds | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
Collateralized mortgage obligation: residential | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
Mortgage-backed securities: residential | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
Total investment securities available-for-sale | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
Investment securities held-to-maturity: | ||||||||||||||||||||||||||||||||
Mortgage-backed securities: residential | ( | ) | ( | ) | ||||||||||||||||||||||||||||
Total investment securities held-to-maturity | ( | ) | ( | ) | ||||||||||||||||||||||||||||
Total investment securities | $ | $ | ( | ) | $ | $ | ( | ) | $ | $ | ( | ) |
December 31, 2018 | ||||||||||||||||||||||||||||||||
Less than 12 Months | 12 Months or Longer | Total | ||||||||||||||||||||||||||||||
Number | Fair Value | Gross Unrealized Holding Losses | Number | Fair Value | Gross Unrealized Holding Losses | Number | Fair Value | Gross Unrealized Holding Losses | ||||||||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||||||||||||
Investment securities available-for-sale: | ||||||||||||||||||||||||||||||||
Agency | $ | $ | ( | ) | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||||||||||||||
Corporate | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
Municipal bonds | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
Collateralized mortgage obligation: residential | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
Mortgage-backed securities: residential | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
Total investment securities available-for-sale | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
Investment securities held-to-maturity: | ||||||||||||||||||||||||||||||||
Mortgage-backed securities: residential | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
Total investment securities held-to-maturity | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
Total investment securities | $ | $ | ( | ) | $ | $ | ( | ) | $ | $ | ( | ) |
One Year or Less | More than One Year to Five Years | More than Five Years to Ten Years | More than Ten Years | Total | |||||||||||||||||||||||||||||||||||
Amortized Cost | Fair Value | Amortized Cost | Fair Value | Amortized Cost | Fair Value | Amortized Cost | Fair Value | Amortized Cost | Fair Value | ||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||||||||
Investment securities available-for-sale: | |||||||||||||||||||||||||||||||||||||||
U.S. Treasury | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Agency | |||||||||||||||||||||||||||||||||||||||
Corporate | |||||||||||||||||||||||||||||||||||||||
Municipal bonds | |||||||||||||||||||||||||||||||||||||||
Collateralized mortgage obligation: residential | |||||||||||||||||||||||||||||||||||||||
Mortgage-backed securities: residential | |||||||||||||||||||||||||||||||||||||||
Total investment securities available-for-sale | |||||||||||||||||||||||||||||||||||||||
Investment securities held-to-maturity: | |||||||||||||||||||||||||||||||||||||||
Mortgage-backed securities: residential | |||||||||||||||||||||||||||||||||||||||
Other | |||||||||||||||||||||||||||||||||||||||
Total investment securities held-to-maturity | |||||||||||||||||||||||||||||||||||||||
Total investment securities | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ |
March 31, 2019 | December 31, 2018 | ||||||
(dollars in thousands) | |||||||
Business loans | |||||||
Commercial and industrial | $ | $ | |||||
Franchise | |||||||
Commercial owner occupied (1) | |||||||
SBA | |||||||
Agribusiness | |||||||
Total business loans | |||||||
Real estate loans | |||||||
Commercial non-owner occupied | |||||||
Multi-family | |||||||
One-to-four family (2) | |||||||
Construction | |||||||
Farmland | |||||||
Land | |||||||
Total real estate loans | |||||||
Consumer loans | |||||||
Consumer loans | |||||||
Gross loans held for investment (3) | |||||||
Deferred loan origination (fees)/costs and (discounts)/premiums, net | ( | ) | ( | ) | |||
Loans held for investment | |||||||
Allowance for loan losses | ( | ) | ( | ) | |||
Loans held for investment, net | $ | $ | |||||
Loans held for sale, at lower of cost or fair value | $ | $ |
• | Pass classifications represent assets with a level of credit quality, in which no well-defined deficiency or weakness exists. |
• | Special Mention assets do not currently expose the Bank to a sufficient risk to warrant classification in one of the adverse categories, but possess correctable deficiencies or potential weaknesses deserving management’s close attention. |
• | Substandard assets are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. These assets are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected. OREO acquired from foreclosure is also classified as Substandard. |
• | Doubtful credits have all the weaknesses inherent in Substandard credits, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. |
• | Loss assets are those that are considered uncollectible and of such little value that their continuance as assets is not warranted. Amounts classified as loss are promptly charged off. |
Credit Risk Grades | ||||||||||||||||||||
Pass | Special Mention | Substandard | Doubtful | Total Gross Loans | ||||||||||||||||
March 31, 2019 | (dollars in thousands) | |||||||||||||||||||
Business loans | ||||||||||||||||||||
Commercial and industrial | $ | $ | $ | $ | $ | |||||||||||||||
Franchise | ||||||||||||||||||||
Commercial owner occupied | ||||||||||||||||||||
SBA | ||||||||||||||||||||
Agribusiness | ||||||||||||||||||||
Real estate loans | ||||||||||||||||||||
Commercial non-owner occupied | ||||||||||||||||||||
Multi-family | ||||||||||||||||||||
One-to-four family | ||||||||||||||||||||
Construction | ||||||||||||||||||||
Farmland | ||||||||||||||||||||
Land | ||||||||||||||||||||
Consumer loans | ||||||||||||||||||||
Consumer loans | ||||||||||||||||||||
Totals | $ | $ | $ | $ | $ |
Credit Risk Grades | ||||||||||||||||||||
Pass | Special Mention | Substandard | Doubtful | Total Gross Loans | ||||||||||||||||
December 31, 2018 | (dollars in thousands) | |||||||||||||||||||
Business loans | ||||||||||||||||||||
Commercial and industrial | $ | $ | $ | $ | $ | |||||||||||||||
Franchise | ||||||||||||||||||||
Commercial owner occupied | ||||||||||||||||||||
SBA | ||||||||||||||||||||
Agribusiness | ||||||||||||||||||||
Real estate loans | ||||||||||||||||||||
Commercial non-owner occupied | ||||||||||||||||||||
Multi-family | ||||||||||||||||||||
One-to-four family | ||||||||||||||||||||
Construction | ||||||||||||||||||||
Farmland | ||||||||||||||||||||
Land | ||||||||||||||||||||
Consumer loans | ||||||||||||||||||||
Consumer loans | ||||||||||||||||||||
Totals | $ | $ | $ | $ | $ |
Days Past Due | ||||||||||||||||||||||||
Current | 30-59 | 60-89 | 90+ | Total Gross Loans | Non-accruing | |||||||||||||||||||
March 31, 2019 | (dollars in thousands) | |||||||||||||||||||||||
Business loans | ||||||||||||||||||||||||
Commercial and industrial | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
Franchise | ||||||||||||||||||||||||
Commercial owner occupied | ||||||||||||||||||||||||
SBA | ||||||||||||||||||||||||
Agribusiness | ||||||||||||||||||||||||
Real estate loans | ||||||||||||||||||||||||
Commercial non-owner occupied | ||||||||||||||||||||||||
Multi-family | ||||||||||||||||||||||||
One-to-four family | ||||||||||||||||||||||||
Construction | ||||||||||||||||||||||||
Farmland | ||||||||||||||||||||||||
Land | ||||||||||||||||||||||||
Consumer loans | ||||||||||||||||||||||||
Consumer loans | ||||||||||||||||||||||||
Totals | $ | $ | $ | $ | $ | $ |
Days Past Due | ||||||||||||||||||||||||
Current | 30-59 | 60-89 | 90+ | Total Gross Loans | Non-accruing | |||||||||||||||||||
December 31, 2018 | (dollars in thousands) | |||||||||||||||||||||||
Business loans | ||||||||||||||||||||||||
Commercial and industrial | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
Franchise | ||||||||||||||||||||||||
Commercial owner occupied | ||||||||||||||||||||||||
SBA | ||||||||||||||||||||||||
Agribusiness | ||||||||||||||||||||||||
Real estate loans | ||||||||||||||||||||||||
Commercial non-owner occupied | ||||||||||||||||||||||||
Multi-family | ||||||||||||||||||||||||
One-to-four family | ||||||||||||||||||||||||
Construction | ||||||||||||||||||||||||
Farmland | ||||||||||||||||||||||||
Land | ||||||||||||||||||||||||
Consumer loans | ||||||||||||||||||||||||
Consumer loans | ||||||||||||||||||||||||
Totals | $ | $ | $ | $ | $ | $ |
Impaired Loans | ||||||||||||||||||||
Unpaid Principal Balance | Recorded Investment | With Specific Allowance | Without Specific Allowance | Specific Allowance for Impaired Loans | ||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||
March 31, 2019 | ||||||||||||||||||||
Business loans | ||||||||||||||||||||
Commercial and industrial | $ | $ | $ | $ | $ | |||||||||||||||
Franchise | ||||||||||||||||||||
Commercial owner occupied | ||||||||||||||||||||
SBA | ||||||||||||||||||||
Agribusiness | ||||||||||||||||||||
Real estate loans | ||||||||||||||||||||
One-to-four family | ||||||||||||||||||||
Consumer loans | ||||||||||||||||||||
Consumer loans | ||||||||||||||||||||
Totals | $ | $ | $ | $ | $ |
Impaired Loans | ||||||||||||||||||||
Unpaid Principal Balance | Recorded Investment | With Specific Allowance | Without Specific Allowance | Specific Allowance for Impaired Loans | ||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||
December 31, 2018 | ||||||||||||||||||||
Business loans | ||||||||||||||||||||
Commercial and industrial | $ | $ | $ | $ | $ | |||||||||||||||
Franchise | ||||||||||||||||||||
Commercial owner occupied | ||||||||||||||||||||
SBA | ||||||||||||||||||||
Agribusiness | ||||||||||||||||||||
Real estate loans | ||||||||||||||||||||
One-to-four family | ||||||||||||||||||||
Totals | $ | $ | $ | $ | $ |
Impaired Loans | ||||||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||||||
March 31, 2019 | December 31, 2018 | March 31, 2018 | ||||||||||||||||||||||
Average Recorded Investment | Interest Income Recognized (1) | Average Recorded Investment | Interest Income Recognized (1) | Average Recorded Investment | Interest Income Recognized (1) | |||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||||
Business loans | ||||||||||||||||||||||||
Commercial and industrial | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
Franchise | ||||||||||||||||||||||||
Commercial owner occupied | ||||||||||||||||||||||||
SBA | ||||||||||||||||||||||||
Agribusiness | ||||||||||||||||||||||||
Real estate loans | ||||||||||||||||||||||||
Commercial non-owner occupied | ||||||||||||||||||||||||
Multi-family | ||||||||||||||||||||||||
One-to-four family | ||||||||||||||||||||||||
Land | ||||||||||||||||||||||||
Consumer loans | ||||||||||||||||||||||||
Consumer loans | $ | |||||||||||||||||||||||
Totals | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
(1) Cash basis and accrual basis is materially the same. |
March 31, 2019 | December 31, 2018 | ||||||
(dollars in thousands) | |||||||
Nonaccrual loans | $ | $ | |||||
Accruing loans | |||||||
Total impaired loans | $ | $ |
March 31, 2019 | December 31, 2018 | ||||||
(dollars in thousands) | |||||||
Business loans | |||||||
Commercial and industrial | $ | $ | |||||
Commercial owner occupied | |||||||
SBA | |||||||
Real estate loans | |||||||
Commercial non-owner occupied | |||||||
Total purchased credit impaired | $ | $ |
Three Months Ended | ||||||||||||
March 31, | December 31, | March 31, | ||||||||||
2019 | 2018 | 2018 | ||||||||||
(dollars in thousands) | ||||||||||||
Balance at the beginning of period | $ | $ | $ | |||||||||
Additions | ||||||||||||
Accretion | ( | ) | ( | ) | ( | ) | ||||||
Payoffs | ( | ) | ( | ) | ||||||||
Sales | ( | ) | ||||||||||
Reclassification from nonaccretable difference | ||||||||||||
Balance at the end of period | $ | $ | $ |
• | Changes in national, regional and local economic conditions, including trends in real estate values and the interest rate environment, |
• | Changes in the nature and volume of the loan portfolio, including new types of lending, |
• | Changes in volume and severity of past due loans, the volume of nonaccrual loans and the volume and severity of adversely classified or graded loans and |
• | The existence and effect of concentrations of credit, and changes in the level of such concentrations. |
Three Months Ended March 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial and industrial | Franchise | Commercial owner occupied | SBA | Agribusiness | Commercial non-owner occupied | Multi-family | One-to-four family | Construction | Farmland | Land | Consumer loans | Total | |||||||||||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||||||
Balance, December 31, 2018 | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||
Charge-offs | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||||||||||||||||||
Recoveries | |||||||||||||||||||||||||||||||||||||||||||||||||||
Provisions for (reduction in) loan losses | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||||||||||
Balance, March 31, 2019 | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||
Amount of allowance attributed to: | |||||||||||||||||||||||||||||||||||||||||||||||||||
Specifically evaluated impaired loans | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||
General portfolio allocation | |||||||||||||||||||||||||||||||||||||||||||||||||||
Loans individually evaluated for impairment | |||||||||||||||||||||||||||||||||||||||||||||||||||
Specific reserves to total loans individually evaluated for impairment | % | % | % | % | % | % | % | % | % | % | % | % | % | ||||||||||||||||||||||||||||||||||||||
Loans collectively evaluated for impairment | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||
General reserves to total loans collectively evaluated for impairment | % | % | % | % | % | % | % | % | % | % | % | % | % | ||||||||||||||||||||||||||||||||||||||
Total gross loans held for investment | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||
Total allowance to gross loans held for investment | % | % | % | % | % | % | % | % | % | % | % | % | % |
Three Months Ended March 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial and industrial | Franchise | Commercial owner occupied | SBA | Agribusiness | Commercial non-owner occupied | Multi-family | One-to-four family | Construction | Farmland | Land | Consumer loans | Total | |||||||||||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||||||
Balance, December 31, 2017 | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||
Charge-offs | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||||||||||||||||
Recoveries | |||||||||||||||||||||||||||||||||||||||||||||||||||
Provisions for (reduction in) loan losses | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||||||||||||||||||
Balance, March 31, 2018 | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||
Amount of allowance attributed to: | |||||||||||||||||||||||||||||||||||||||||||||||||||
Specifically evaluated impaired loans | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||
General portfolio allocation | |||||||||||||||||||||||||||||||||||||||||||||||||||
Loans individually evaluated for impairment | |||||||||||||||||||||||||||||||||||||||||||||||||||
Specific reserves to total loans individually evaluated for impairment | % | % | % | % | % | % | % | % | % | % | % | % | |||||||||||||||||||||||||||||||||||||||
Loans collectively evaluated for impairment | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
General reserves to total loans collectively evaluated for impairment | % | % | % | % | % | % | % | % | % | % | % | % | % | ||||||||||||||||||||||||||||||||||||||
Total gross loans held for investment | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Total allowance to gross loans held for investment | % | % | % | % | % | % | % | % | % | % | % | % | % |
Three Months Ended | |||||||||||
March 31, 2019 | December 31, 2018 | March 31, 2018 | |||||||||
(dollars in thousands, except per share data) | |||||||||||
Basic | |||||||||||
Net income | $ | $ | $ | ||||||||
Less: Earnings allocated to participating securities | ( | ) | |||||||||
Net income allocated to common stockholders | |||||||||||
Weighted average common shares outstanding | |||||||||||
Basic earnings per common share | $ | $ | $ | ||||||||
Diluted | |||||||||||
Net income allocated to common stockholders | $ | $ | $ | ||||||||
Weighted average common shares outstanding | |||||||||||
Diluted effect of share-based compensation | |||||||||||
Weighted average diluted common shares | |||||||||||
Diluted earnings per common share | $ | $ | $ |
March 31, 2019 | ||||||||||||||||
Fair Value Measurement Using | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total Fair Value | |||||||||||||
(dollars in thousands) | ||||||||||||||||
Financial assets | ||||||||||||||||
Investment securities available-for-sale: | ||||||||||||||||
U.S. Treasury | $ | $ | $ | $ | ||||||||||||
Agency | ||||||||||||||||
Corporate | ||||||||||||||||
Municipal bonds | ||||||||||||||||
Collateralized mortgage obligation | ||||||||||||||||
Mortgage-backed securities | ||||||||||||||||
Total securities available-for-sale | $ | $ | $ | $ | ||||||||||||
Derivative assets | $ | $ | $ | $ | ||||||||||||
Financial liabilities | ||||||||||||||||
Derivative liabilities | $ | $ | $ | $ |
December 31, 2018 | ||||||||||||||||
Fair Value Measurement Using | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total Fair Value | |||||||||||||
(dollars in thousands) | ||||||||||||||||
Financial assets | ||||||||||||||||
Investment securities available-for-sale: | ||||||||||||||||
Treasury | $ | $ | $ | $ | ||||||||||||
Agency | ||||||||||||||||
Corporate | ||||||||||||||||
Municipal bonds | ||||||||||||||||
Collateralized mortgage obligation | ||||||||||||||||
Mortgage-backed securities | ||||||||||||||||
Total securities available-for-sale | $ | $ | $ | $ | ||||||||||||
Derivative assets | $ | $ | $ | $ | ||||||||||||
Financial liabilities | ||||||||||||||||
Derivative liabilities | $ | $ | $ | $ |
At March 31, 2019 | ||||||||||||||||||||
Carrying Amount | Level 1 | Level 2 | Level 3 | Estimated Fair Value | ||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||
Assets: | ||||||||||||||||||||
Cash and cash equivalents | $ | $ | $ | $ | $ | |||||||||||||||
Interest-bearing time deposits with financial institutions | ||||||||||||||||||||
Investments held-to-maturity | ||||||||||||||||||||
Investment securities available-for-sale | ||||||||||||||||||||
Loans held for sale | ||||||||||||||||||||
Loans held for investment, net | ||||||||||||||||||||
Derivative asset | ||||||||||||||||||||
Accrued interest receivable | ||||||||||||||||||||
Liabilities: | ||||||||||||||||||||
Deposit accounts | ||||||||||||||||||||
FHLB advances | ||||||||||||||||||||
Subordinated debentures | ||||||||||||||||||||
Derivative liability | ||||||||||||||||||||
Accrued interest payable |
At December 31, 2018 | ||||||||||||||||||||
Carrying Amount | Level 1 | Level 2 | Level 3 | Estimated Fair Value | ||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||
Assets: | ||||||||||||||||||||
Cash and cash equivalents | $ | $ | $ | $ | $ | |||||||||||||||
Interest-bearing time deposits with financial institutions | ||||||||||||||||||||
Investments held-to-maturity | ||||||||||||||||||||
Investment securities available-for-sale | ||||||||||||||||||||
Loans held for sale | ||||||||||||||||||||
Loans held for investment, net | ||||||||||||||||||||
Derivative asset | ||||||||||||||||||||
Accrued interest receivable | ||||||||||||||||||||
Liabilities: | ||||||||||||||||||||
Deposit accounts | ||||||||||||||||||||
FHLB advances | ||||||||||||||||||||
Other borrowings | ||||||||||||||||||||
Subordinated debentures | ||||||||||||||||||||
Derivative liability | ||||||||||||||||||||
Accrued interest payable |
March 31, 2019 | |||||||||||||||
Derivative Assets | Derivative Liabilities | ||||||||||||||
Notional | Fair Value | Notional | Fair Value | ||||||||||||
(dollars in thousands) | |||||||||||||||
Derivative instruments not designated as hedging instruments: | |||||||||||||||
Interest rate swap contracts | $ | $ | $ | $ | |||||||||||
Total derivative instruments | $ | $ | $ | $ |
December 31, 2018 | |||||||||||||||
Derivative Assets | Derivative Liabilities | ||||||||||||||
Notional | Fair Value | Notional | Fair Value | ||||||||||||
(dollars in thousands) | |||||||||||||||
Derivative instruments not designated as hedging instruments: | |||||||||||||||
Interest rate swap contracts | $ | $ | $ | $ | |||||||||||
Total derivative instruments | $ | $ | $ | $ |
Gross Amounts Not Offset in the Consolidated Balance Sheets | |||||||||||||||||||||||
Gross Amounts Recognized | Gross Amounts Offset in the Consolidated Balance Sheets | Net Amounts Presented in the Consolidated Balance Sheets | Financial Instruments | Cash Collateral (1) | Net Amount | ||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||
March 31, 2019 | |||||||||||||||||||||||
Financial assets: | |||||||||||||||||||||||
Derivatives not designated as hedging instruments | $ | $ | ( | ) | $ | $ | $ | $ | |||||||||||||||
Total | $ | $ | ( | ) | $ | $ | $ | $ | |||||||||||||||
Financial liabilities: | |||||||||||||||||||||||
Derivatives not designated as hedging instruments | $ | $ | $ | $ | $ | $ | |||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | |||||||||||||||||
(1) Represents cash collateral held with counterparty bank. |
Gross Amounts Not Offset in the Consolidated Balance Sheets | |||||||||||||||||||||||
Gross Amounts Recognized | Gross Amounts Offset in the Consolidated Balance Sheets | Net Amounts Presented in the Consolidated Balance Sheets | Financial Instruments | Cash Collateral (1) | Net Amount | ||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||
December 31, 2018 | |||||||||||||||||||||||
Financial assets: | |||||||||||||||||||||||
Derivatives not designated as hedging instruments | $ | $ | ( | ) | $ | $ | $ | $ | |||||||||||||||
Total | $ | $ | ( | ) | $ | $ | $ | $ | |||||||||||||||
Financial liabilities: | |||||||||||||||||||||||
Derivatives not designated as hedging instruments | $ | $ | $ | $ | $ | $ | |||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | |||||||||||||||||
(1) Represents cash collateral held with counterparty bank. |
March 31, 2019 | ||||
(dollars in thousands) | ||||
Balance Sheet: | ||||
Operating lease right of use assets | $ | |||
Operating lease liabilities | ||||
Cash Flows: | ||||
Operating cash flows from operating leases |
2019 | 2020 | 2021 | 2022 | 2023 | Thereafter | Total | |||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||
Contractual base rents (1): | |||||||||||||||||||||||||||
Operating leases | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||
Short-term leases | |||||||||||||||||||||||||||
Total contractual base rents | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||
Total liability to make lease payments | $ | ||||||||||||||||||||||||||
Difference in undiscounted and discounted future lease payments | $ | ||||||||||||||||||||||||||
Weighted average discount rate | % | ||||||||||||||||||||||||||
Weighted average remaining lease term (years) | |||||||||||||||||||||||||||
(1) Contractual base rents reflect options to extend and renewals, and do not include property taxes and other operating expenses due under respective lease agreements. |
2019 | 2020 | 2021 | 2022 | 2023 | Thereafter | Total | |||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||
Minimum contractual lease payments | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||
(1) Contractual based rents in the table above are reflective of future lease obligations under ASC 840, prior to the implementation of ASC 842. The amounts in the table above do not reflect extensions or renewals and do not include property taxes and other operating expenses due under respective lease agreements. The amounts in the table above also reflect future lease obligations for certain leases that have not yet commenced as of December 31, 2018. |
Three Months Ended | |||||||||||||||||||||||
March 31, 2019 | December 31, 2018 | March 31, 2018 | |||||||||||||||||||||
Within Scope(1) | Out of Scope(2) | Within Scope(1) | Out of Scope(2) | Within Scope(1) | Out of Scope(2) | ||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||
Interest income: | |||||||||||||||||||||||
Loans | $ | — | $ | $ | — | $ | $ | — | $ | ||||||||||||||
Investment securities and other interest-earning assets | — | — | — | ||||||||||||||||||||
Total interest income | — | — | — | ||||||||||||||||||||
Noninterest income: | |||||||||||||||||||||||
Loan servicing fees | — | — | — | ||||||||||||||||||||
Service charges on deposit accounts | — | — | — | ||||||||||||||||||||
Other service fee income | — | — | — | ||||||||||||||||||||
Debit card interchange income | — | — | — | ||||||||||||||||||||
Earnings on bank-owned life insurance | — | — | — | ||||||||||||||||||||
Net gain from sales of loans | — | — | — | ||||||||||||||||||||
Net gain from sales of investment securities | — | — | — | ||||||||||||||||||||
Other income | ( | ) | |||||||||||||||||||||
Total noninterest income | |||||||||||||||||||||||
Total revenues | $ | $ | $ | $ | $ | $ | |||||||||||||||||
(1) Revenues from contracts with customers accounted for under ASC 606. | |||||||||||||||||||||||
(2) Revenues not within the scope of ASC 606 and accounted for under other applicable U.S. GAAP requirements. |
• | The strength of the U.S. economy in general and the strength of the local economies in which we conduct operations; |
• | The effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System (the “Federal Reserve”) |
• | The impact of changes in financial services policies, laws and regulations, including those concerning taxes, banking, securities and insurance, and the application thereof by regulatory bodies; |
• | Inflation/deflation, interest rate, market and monetary fluctuations; |
• | The effect of changes in accounting policies and practices, as may be adopted from time-to-time by bank regulatory agencies, the SEC, the Public Company Accounting Oversight Board, the FASB or other accounting standards setters; |
• | The impact of current governmental efforts to restructure the U.S. financial regulatory system, including amendments to the Dodd-Frank Wall Street Reform and Consumer Protection Act; |
• | Changes in consumer spending, borrowing and savings habits; |
• | Changes in the competitive environment among financial and bank holding companies and other financial service providers; |
• | Geopolitical conditions, including acts or threats of terrorism, actions taken by the United States or other governments in response to acts or threats of terrorism and/or military conflicts, which could impact business and economic conditions in the United States and abroad; |
• | Cybersecurity threats and the cost of defending against them, including the costs of compliance with potential legislation to combat cybersecurity at a state, national or global level; |
• | The effect of acquisitions we may make, such as our recent acquisition of Grandpoint, including, without limitation, the failure to achieve the expected revenue growth and/or expense savings from such acquisitions, and/or the failure to effectively integrate an acquisition target into our operations; |
• | The timely development of competitive new products and services and the acceptance of these products and services by new and existing customers; |
• | The effectiveness of our risk management framework and quantitative models; |
• | Changes in the level of our nonperforming assets and charge-offs; |
• | The effects of our lack of a diversified loan portfolio, including the risks of geographic and industry concentrations; |
• | Our ability to attract deposits and other sources of liquidity; |
• | Changes in the financial performance and/or condition of our borrowers; |
• | Unanticipated regulatory or judicial proceedings; and |
• | Our ability to manage the risks involved in the foregoing. |
• | $2.35 billion of gross loans; |
• | $313.0 million in goodwill; |
• | $147.6 million of cash and cash equivalents; |
• | $392.9 million of investment securities; |
• | $97.2 million of other types of assets; |
• | $9.1 million in fixed assets; |
• | $4.4 million of deterred tax assets; and |
• | $71.9 million of a core deposit intangible. |
• | $2.51 billion in deposit transaction accounts; |
• | $254.9 million in borrowings; and |
• | $24.9 million other liabilities. |
Three Months Ended | ||||||||||||
March 31, | December 31, | March 31, | ||||||||||
2019 | 2018 | 2018 | ||||||||||
(dollars in thousands) | ||||||||||||
Net income | $ | 38,718 | $ | 39,643 | $ | 28,002 | ||||||
Plus: CDI amortization expense | 4,436 | 4,631 | 2,274 | |||||||||
Less: CDI amortization expense tax adjustment (1) | 1,288 | 1,294 | 548 | |||||||||
Net income for average tangible common equity | $ | 41,866 | $ | 42,980 | $ | 29,728 | ||||||
Average stockholders’ equity | $ | 1,991,861 | $ | 1,944,623 | $ | 1,255,629 | ||||||
Less: average CDI | 98,984 | 103,434 | 42,220 | |||||||||
Less: average goodwill | 808,726 | 808,516 | 493,357 | |||||||||
Average tangible common equity | $ | 1,084,151 | $ | 1,032,673 | $ | 720,052 | ||||||
Return on average equity (2) | 7.78 | % | 8.15 | % | 8.92 | % | ||||||
Return on average tangible common equity (2) | 15.45 | % | 16.65 | % | 16.51 | % |
Three Months Ended | ||||||||||||
March 31, | December 31, | March 31, | ||||||||||
2019 | 2018 | 2018 | ||||||||||
(dollars in thousands) | ||||||||||||
Total noninterest expense | $ | 63,577 | $ | 67,239 | $ | 49,808 | ||||||
Less: CDI amortization | 4,436 | 4,631 | 2,274 | |||||||||
Less: merger-related expense | 655 | 2,597 | 936 | |||||||||
Less: other real estate owned operations, net | 3 | 1 | 1 | |||||||||
Noninterest expense, adjusted | $ | 58,483 | $ | 60,010 | $ | 46,597 | ||||||
Net interest income before provision for loan losses | $ | 111,406 | $ | 117,546 | $ | 81,281 | ||||||
Add: total noninterest income loss | 7,681 | 6,970 | 7,666 | |||||||||
Less: net gain loss from investment securities | 427 | — | 6 | |||||||||
Less: net gain (loss) from other real estate owned | — | 305 | (8 | ) | ||||||||
Revenue, adjusted | $ | 118,660 | $ | 124,211 | $ | 88,949 | ||||||
Efficiency Ratio | 49.3 | % | 48.3 | % | 52.4 | % |
Average Balance Sheet | ||||||||||||||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||||||||||||||
March 31, 2019 | December 31, 2018 | March 31, 2018 | ||||||||||||||||||||||||||||||
Average Balance | Interest | Average Yield/Cost | Average Balance | Interest | Average Yield/Cost | Average Balance | Interest | Average Yield/Cost | ||||||||||||||||||||||||
Assets | (dollars in thousands) | |||||||||||||||||||||||||||||||
Interest-earning assets: | ||||||||||||||||||||||||||||||||
Cash and cash equivalents | $ | 173,613 | $ | 378 | 0.88 | % | $ | 230,377 | $ | 634 | 1.09 | % | $ | 167,236 | $ | 313 | 0.76 | % | ||||||||||||||
Investment securities | 1,298,476 | 9,389 | 2.89 | 1,243,240 | 9,046 | 2.91 | 919,526 | 6,341 | 2.76 | |||||||||||||||||||||||
Loans receivable, net (1)(2) | 8,867,159 | 121,476 | 5.56 | 8,909,407 | 126,341 | 5.63 | 6,237,968 | 84,173 | 5.47 | |||||||||||||||||||||||
Total interest-earning assets | 10,339,248 | 131,243 | 5.15 | 10,383,024 | 136,021 | 5.20 | 7,324,730 | 90,827 | 5.03 | |||||||||||||||||||||||
Noninterest-earning assets | 1,224,281 | 1,199,343 | 720,569 | |||||||||||||||||||||||||||||
Total assets | $ | 11,563,529 | $ | 11,582,367 | $ | 8,045,299 | ||||||||||||||||||||||||||
Liabilities and Equity | ||||||||||||||||||||||||||||||||
Interest-bearing deposits: | ||||||||||||||||||||||||||||||||
Interest checking | $ | 536,117 | $ | 474 | 0.36 | $ | 521,778 | $ | 456 | 0.35 | $ | 348,110 | $ | 114 | 0.13 | |||||||||||||||||
Money market | 2,912,819 | 6,534 | 0.91 | 2,963,437 | 6,074 | 0.81 | 2,189,912 | 3,159 | 0.59 | |||||||||||||||||||||||
Savings | 249,621 | 86 | 0.14 | 258,634 | 98 | 0.15 | 223,992 | 79 | 0.14 | |||||||||||||||||||||||
Retail certificates of deposit | 1,001,344 | 4,058 | 1.64 | 1,025,311 | 3,842 | 1.49 | 713,290 | 1,388 | 0.79 | |||||||||||||||||||||||
Wholesale/brokered certificates of deposit | 373,822 | 2,132 | 2.31 | 296,345 | 1,571 | 2.10 | 377,549 | 1,174 | 1.26 | |||||||||||||||||||||||
Total interest-bearing deposits | 5,073,723 | 13,284 | 1.06 | 5,065,505 | 12,041 | 0.94 | 3,852,853 | 5,914 | 0.62 | |||||||||||||||||||||||
FHLB advances and other borrowings | 770,331 | 4,802 | 2.53 | 795,029 | 4,701 | 2.35 | 508,142 | 2,023 | 1.61 | |||||||||||||||||||||||
Subordinated debentures | 110,340 | 1,751 | 6.35 | 110,271 | 1,733 | 6.29 | 105,153 | 1,609 | 6.12 | |||||||||||||||||||||||
Total borrowings | 880,671 | 6,553 | 3.02 | 905,300 | 6,434 | 2.82 | 613,295 | 3,632 | 2.40 | |||||||||||||||||||||||
Total interest-bearing liabilities | 5,954,394 | 19,837 | 1.35 | 5,970,805 | 18,475 | 1.23 | 4,466,148 | 9,546 | 0.87 | |||||||||||||||||||||||
Noninterest-bearing deposits | 3,480,791 | 3,571,119 | 2,262,895 | |||||||||||||||||||||||||||||
Other liabilities | 136,483 | 95,820 | 60,627 | |||||||||||||||||||||||||||||
Total liabilities | 9,571,668 | 9,637,744 | 6,789,670 | |||||||||||||||||||||||||||||
Stockholders’ equity | 1,991,861 | 1,944,623 | 1,255,629 | |||||||||||||||||||||||||||||
Total liabilities and equity | $ | 11,563,529 | $ | 11,582,367 | $ | 8,045,299 | ||||||||||||||||||||||||||
Net interest income | $ | 111,406 | $ | 117,546 | $ | 81,281 | ||||||||||||||||||||||||||
Net interest margin (3) | 4.37 | % | 4.49 | % | 4.50 | % | ||||||||||||||||||||||||||
Cost of deposits | 0.63 | 0.55 | 0.39 | |||||||||||||||||||||||||||||
Cost of funds (4) | 0.85 | 0.77 | 0.58 | |||||||||||||||||||||||||||||
Ratio of interest-earning assets to interest-bearing liabilities | 173.64 | 173.90 | 164.01 | |||||||||||||||||||||||||||||
(1) Average balance includes loans held for sale and nonperforming loans and is net of deferred loan origination fees/costs and discounts/premiums. | ||||||||||||||||||||||||||||||||
(2) Interest income includes net discount accretion of $3.8 million, $6.3 million and $3.7 million, respectively. | ||||||||||||||||||||||||||||||||
(3) Represents annualized net interest income divided by average interest-earning assets. | ||||||||||||||||||||||||||||||||
(4) Represents annualized total interest expense divided by the sum of average total interest-bearing liabilities and noninterest-bearing deposits. |
• | Changes in volume (changes in volume multiplied by prior rate); |
• | Changes in days in a period (changes in days in a period multiplied by daily interest); |
• | Changes in interest rates (changes in interest rates multiplied by prior volume) (includes the recognition of deferred fees/costs and discounts/premiums; and |
• | The net change or the combined impact of volume, days in a period and rate changes allocated proportionately to changes in volume, days in a period and changes in interest rates. |
Three Months Ended March 31, 2019 Compared to Three Months Ended December 31, 2018 Increase (decrease) due to | |||||||||||||||
Volume | Days | Rate | Net | ||||||||||||
(dollars in thousands) | |||||||||||||||
Interest-earning assets | |||||||||||||||
Cash and cash equivalents | $ | (140 | ) | $ | (8 | ) | $ | (108 | ) | $ | (256 | ) | |||
Investment securities | 638 | — | (295 | ) | 343 | ||||||||||
Loans receivable, net | (598 | ) | (2,699 | ) | (1,568 | ) | (4,865 | ) | |||||||
Total interest-earning assets | (100 | ) | (2,707 | ) | (1,971 | ) | (4,778 | ) | |||||||
Interest-bearing liabilities | |||||||||||||||
Interest checking | 14 | (11 | ) | 15 | 18 | ||||||||||
Money market | (97 | ) | (145 | ) | 702 | 460 | |||||||||
Savings | (3 | ) | (2 | ) | (7 | ) | (12 | ) | |||||||
Retail certificates of deposit | (93 | ) | (90 | ) | 399 | 216 | |||||||||
Wholesale/brokered certificates of deposit | 440 | (47 | ) | 168 | 561 | ||||||||||
FHLB advances and other borrowings | (142 | ) | (107 | ) | 350 | 101 | |||||||||
Subordinated debentures | — | — | 18 | 18 | |||||||||||
Total interest-bearing liabilities | 119 | (402 | ) | 1,645 | 1,362 | ||||||||||
Change in net interest income | $ | (219 | ) | $ | (2,305 | ) | $ | (3,616 | ) | $ | (6,140 | ) |
Three Months Ended March 31, 2019 Compared to Three Months Ended March 31, 2018 Increase (decrease) due to | |||||||||||
Volume | Rate | Net | |||||||||
(dollars in thousands) | |||||||||||
Interest-earning assets | |||||||||||
Cash and cash equivalents | $ | 13 | $ | 52 | $ | 65 | |||||
Investment securities | 2,740 | 308 | 3,048 | ||||||||
Loans receivable, net | 35,901 | 1,402 | 37,303 | ||||||||
Total interest-earning assets | 38,654 | 1,762 | 40,416 | ||||||||
Interest-bearing liabilities | |||||||||||
Interest checking | 84 | 276 | 360 | ||||||||
Money market | 1,278 | 2,097 | 3,375 | ||||||||
Savings | 7 | — | 7 | ||||||||
Retail certificates of deposit | 727 | 1,943 | 2,670 | ||||||||
Wholesale/brokered certificates of deposit | (12 | ) | 970 | 958 | |||||||
FHLB advances and other borrowings | 1,316 | 1,463 | 2,779 | ||||||||
Subordinated debentures | 80 | 62 | 142 | ||||||||
Total interest-bearing liabilities | 3,480 | 6,811 | 10,291 | ||||||||
Change in net interest income | $ | 35,174 | $ | (5,049 | ) | $ | 30,125 |
March 31, 2019 | December 31, 2018 | ||||||||||||||||||
Amount | Percent of Total | Weighted Average Interest Rate | Amount | Percent of Total | Weighted Average Interest Rate | ||||||||||||||
(dollars in thousands) | |||||||||||||||||||
Business loans | |||||||||||||||||||
Commercial and industrial | $ | 1,336,520 | 15.1 | % | 5.75 | % | $ | 1,364,423 | 15.4 | % | 5.83 | % | |||||||
Franchise | 813,057 | 9.2 | 5.43 | 765,416 | 8.7 | 5.40 | |||||||||||||
Commercial owner occupied (1) | 1,648,762 | 18.6 | 4.97 | 1,679,122 | 19.0 | 4.94 | |||||||||||||
SBA | 188,757 | 2.1 | 7.39 | 193,882 | 2.2 | 7.17 | |||||||||||||
Agribusiness | 134,603 | 1.5 | 5.50 | 138,519 | 1.6 | 5.46 | |||||||||||||
Total business loans | 4,121,699 | 46.5 | 5.44 | 4,141,362 | 46.9 | 5.44 | |||||||||||||
Real estate loans | |||||||||||||||||||
Commercial non-owner occupied | 2,124,250 | 23.9 | 4.69 | 2,003,174 | 22.6 | 4.67 | |||||||||||||
Multi-family | 1,511,942 | 17.0 | 4.37 | 1,535,289 | 17.4 | 4.33 | |||||||||||||
One-to-four family (2) | 279,467 | 3.1 | 5.09 | 356,264 | 4.0 | 5.01 | |||||||||||||
Construction | 538,197 | 6.1 | 6.67 | 523,643 | 5.9 | 6.74 | |||||||||||||
Farmland | 167,345 | 1.9 | 4.81 | 150,502 | 1.7 | 4.80 | |||||||||||||
Land | 46,848 | 0.5 | 5.49 | 46,628 | 0.5 | 5.61 | |||||||||||||
Total real estate loans | 4,668,049 | 52.5 | 4.85 | 4,615,500 | 52.1 | 4.83 | |||||||||||||
Consumer loans | |||||||||||||||||||
Consumer loans | 85,302 | 1.0 | 5.56 | 89,424 | 1.0 | 5.60 | |||||||||||||
Gross loans held for investment (3) | 8,875,050 | 100.0 | % | 5.13 | % | 8,846,286 | 100.0 | % | 5.13 | % | |||||||||
Deferred loan origination (fees)/costs and (discounts)/premiums, net | (9,195 | ) | (9,468 | ) | |||||||||||||||
Loans held for investment | 8,865,855 | 8,836,818 | |||||||||||||||||
Allowance for loan losses | (37,856 | ) | (36,072 | ) | |||||||||||||||
Loans held for investment, net | $ | 8,827,999 | $ | 8,800,746 | |||||||||||||||
Loans held for sale, at lower of cost or fair value | $ | 11,671 | $ | 5,719 |
30 - 59 Days | 60 - 89 Days | 90 Days or More (1) | Total | ||||||||||||||||||||||||
# of Loans | Principal Balance of Loans | # of Loans | Principal Balance of Loans | # of Loans | Principal Balance of Loans | # of Loans | Principal Balance of Loans | ||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||
At March 31, 2019 | |||||||||||||||||||||||||||
Business loans | |||||||||||||||||||||||||||
Commercial and industrial | 5 | $ | 524 | 5 | $ | 1,439 | 6 | $ | 893 | 16 | $ | 2,856 | |||||||||||||||
Franchise | — | — | — | — | 2 | 5,870 | 2 | 5,870 | |||||||||||||||||||
Commercial owner occupied | — | — | — | — | 2 | 726 | 2 | 726 | |||||||||||||||||||
SBA | 6 | 965 | 1 | 103 | 7 | 3,991 | 14 | 5,059 | |||||||||||||||||||
Agribusiness | 1 | 10 | — | — | — | — | 1 | 10 | |||||||||||||||||||
Real estate loans | |||||||||||||||||||||||||||
Commercial non-owner occupied | 1 | 731 | — | — | — | — | 1 | 731 | |||||||||||||||||||
Multi-family | — | — | 1 | 440 | — | — | 1 | 440 | |||||||||||||||||||
One-to-four family | 1 | 69 | — | — | 1 | 1 | 2 | 70 | |||||||||||||||||||
Total | 14 | $ | 2,299 | 7 | $ | 1,982 | 18 | $ | 11,481 | 39 | $ | 15,762 | |||||||||||||||
Delinquent loans to loans held for investment | 0.03 | % | 0.02 | % | 0.13 | % | 0.18 | % | |||||||||||||||||||
At December 31, 2018 | |||||||||||||||||||||||||||
Business loans | |||||||||||||||||||||||||||
Commercial and industrial | 6 | $ | 309 | 4 | $ | 1,204 | 5 | $ | 931 | 15 | $ | 2,444 | |||||||||||||||
Franchise | 1 | 5,680 | — | — | 1 | 190 | 2 | 5,870 | |||||||||||||||||||
Commercial owner occupied | 1 | 343 | — | — | 5 | 812 | 6 | 1,155 | |||||||||||||||||||
SBA | 3 | 524 | — | — | 3 | 2,626 | 6 | 3,150 | |||||||||||||||||||
Real estate loans | |||||||||||||||||||||||||||
Multi-family | 1 | 14 | — | — | — | — | 1 | 14 | |||||||||||||||||||
One-to-four family | 1 | 30 | 1 | 9 | 1 | 6 | 3 | 45 | |||||||||||||||||||
Land | — | — | — | — | — | — | — | — | |||||||||||||||||||
Consumer loans | |||||||||||||||||||||||||||
Consumer | 3 | 146 | 1 | 29 | — | — | 4 | 175 | |||||||||||||||||||
Total | 16 | $ | 7,046 | 6 | $ | 1,242 | 15 | $ | 4,565 | 37 | $ | 12,853 | |||||||||||||||
Delinquent loans to loans held for investment | 0.08 | % | 0.02 | % | 0.05 | % | 0.15 | % |
March 31, 2019 | December 31, 2018 | |||||||||||||||||||
Balance at End of Period Applicable to | Amount | Allowance as a % of Category Total | % of Loans in Category to Total Loans | Amount | Allowance as a % of Category Total | % of Loans in Category to Total Loans | ||||||||||||||
(dollars in thousands) | ||||||||||||||||||||
Business loans | ||||||||||||||||||||
Commercial and industrial | $ | 10,450 | 0.78 | % | 15.1 | % | $ | 10,821 | 0.79 | % | 15.4 | % | ||||||||
Franchise | 7,871 | 0.97 | 9.2 | 6,500 | 0.85 | 8.7 | ||||||||||||||
Commercial owner occupied | 1,305 | 0.08 | 18.6 | 1,386 | 0.08 | 19.0 | ||||||||||||||
SBA | 5,173 | 2.74 | 2.1 | 4,288 | 2.21 | 2.2 | ||||||||||||||
Agribusiness | 3,137 | 2.33 | 1.5 | 3,283 | 2.37 | 1.6 | ||||||||||||||
Real estate loans | ||||||||||||||||||||
Commercial non-owner occupied | 1,668 | 0.08 | 23.9 | 1,604 | 0.08 | 22.6 | ||||||||||||||
Multi-family | 669 | 0.04 | 17.0 | 725 | 0.05 | 17.4 | ||||||||||||||
One-to-four family | 758 | 0.27 | 3.1 | 805 | 0.23 | 4.0 | ||||||||||||||
Construction | 5,194 | 0.97 | 6.1 | 5,166 | 0.99 | 5.9 | ||||||||||||||
Farmland | 664 | 0.40 | 1.9 | 503 | 0.33 | 1.7 | ||||||||||||||
Land | 766 | 1.64 | 0.5 | 772 | 1.66 | 0.5 | ||||||||||||||
Consumer loans | ||||||||||||||||||||
Consumer loans | 201 | 0.24 | 1.0 | 219 | 0.24 | 1.0 | ||||||||||||||
Total | $ | 37,856 | 0.43 | % | 100.0 | % | $ | 36,072 | 0.41 | % | 100.0 | % |
Three Months Ended | |||||||||||
March 31, | December 31, | March 31, | |||||||||
2019 | 2018 | 2018 | |||||||||
(dollars in thousands) | |||||||||||
Balance, beginning of period | $ | 36,072 | $ | 33,306 | $ | 28,936 | |||||
Provision for loan losses | 2,012 | 2,904 | 2,253 | ||||||||
Charge-offs: | |||||||||||
Business loans: | |||||||||||
Commercial and industrial | (302 | ) | (400 | ) | (665 | ) | |||||
Commercial owner occupied | — | (33 | ) | — | |||||||
SBA | — | (2 | ) | (29 | ) | ||||||
Consumer loans: | |||||||||||
Consumer loans | (5 | ) | (272 | ) | (52 | ) | |||||
Total charge-offs | (307 | ) | (707 | ) | (746 | ) | |||||
Recoveries: | |||||||||||
Business loans: | |||||||||||
Commercial and industrial | 67 | 415 | 25 | ||||||||
Commercial owner occupied | 8 | 15 | 8 | ||||||||
SBA | 3 | 126 | 26 | ||||||||
Real estate: | |||||||||||
One-to-four family | — | 12 | — | ||||||||
Consumer loans: | |||||||||||
Consumer loans | 1 | 1 | — | ||||||||
Total recoveries | 79 | 569 | 59 | ||||||||
Net loan charge-offs | (228 | ) | (138 | ) | (687 | ) | |||||
Balance at end of period | $ | 37,856 | $ | 36,072 | $ | 30,502 | |||||
Ratios: | |||||||||||
Annualized net charge-offs to average total loans, net | 0.01 | % | 0.01 | % | 0.04 | % | |||||
Allowance for loan losses to loans held for investment at end of period | 0.43 | % | 0.41 | % | 0.49 | % |
March 31, 2019 | December 31, 2018 | |||||||
(dollars in thousands) | ||||||||
Nonperforming assets | ||||||||
Business loans: | ||||||||
Commercial and industrial | $ | 1,906 | $ | 931 | ||||
Franchise | 5,870 | 190 | ||||||
Commercial owner occupied | 564 | 599 | ||||||
SBA | 4,104 | 2,739 | ||||||
Total business loans | 12,444 | 4,459 | ||||||
Real estate: | ||||||||
One-to-four family | 388 | 398 | ||||||
Total real estate loans | 388 | 398 | ||||||
Consumer loans: | ||||||||
Consumer loans | 26 | — | ||||||
Total nonperforming loans | 12,858 | 4,857 | ||||||
Other real estate owned | 180 | 147 | ||||||
Other assets owned | 13 | 13 | ||||||
Total nonperforming assets | $ | 13,051 | $ | 5,017 | ||||
Allowance for loan losses | $ | 37,856 | $ | 36,072 | ||||
Allowance for loan losses as a percent of total nonperforming loans | 294 | % | 743 | % | ||||
Nonperforming loans as a percent of loans held for investment | 0.15 | 0.05 | ||||||
Nonperforming assets as a percent of total assets | 0.11 | 0.04 |
March 31, 2019 | ||||||||||||||||
Amortized Cost | Unrealized Gain | Unrealized Loss | Estimated Fair Value | |||||||||||||
(dollars in thousands) | ||||||||||||||||
Investment securities available-for-sale: | ||||||||||||||||
U.S. Treasury | $ | 59,716 | $ | 2,185 | $ | — | $ | 61,901 | ||||||||
Agency | 161,945 | 3,987 | (444 | ) | 165,488 | |||||||||||
Corporate | 138,128 | 538 | (811 | ) | 137,855 | |||||||||||
Municipal bonds | 213,561 | 4,122 | (667 | ) | 217,016 | |||||||||||
Collateralized mortgage obligation: residential | 23,642 | 70 | (261 | ) | 23,451 | |||||||||||
Mortgage-backed securities: residential | 567,348 | 3,669 | (5,318 | ) | 565,699 | |||||||||||
Total investment securities available-for-sale | 1,164,340 | 14,571 | (7,501 | ) | 1,171,410 | |||||||||||
Investment securities held-to-maturity: | ||||||||||||||||
Mortgage-backed securities: residential | 42,083 | 466 | (380 | ) | 42,169 | |||||||||||
Other | 1,811 | — | — | 1,811 | ||||||||||||
Total securities held-to-maturity | 43,894 | 466 | (380 | ) | 43,980 | |||||||||||
Total investment securities | $ | 1,208,234 | $ | 15,037 | $ | (7,881 | ) | $ | 1,215,390 |
December 31, 2018 | ||||||||||||||||
Amortized Cost | Unrealized Gain | Unrealized Loss | Estimated Fair Value | |||||||||||||
(dollars in thousands) | ||||||||||||||||
Investment securities available-for-sale: | ||||||||||||||||
U.S. Treasury | $ | 59,688 | $ | 1,224 | $ | — | $ | 60,912 | ||||||||
Agency | 128,958 | 1,631 | (519 | ) | 130,070 | |||||||||||
Corporate | 104,158 | 291 | (906 | ) | 103,543 | |||||||||||
Municipal bonds | 238,914 | 1,941 | (2,225 | ) | 238,630 | |||||||||||
Collateralized mortgage obligation: residential | 24,699 | 64 | (425 | ) | 24,338 | |||||||||||
Mortgage-backed securities: residential | 554,751 | 1,112 | (10,134 | ) | 545,729 | |||||||||||
Total investment securities available-for-sale | 1,111,168 | 6,263 | (14,209 | ) | 1,103,222 | |||||||||||
Investment securities held-to-maturity: | ||||||||||||||||
Mortgage-backed securities: residential | 43,381 | 148 | (686 | ) | 42,843 | |||||||||||
Other | 1,829 | — | — | 1,829 | ||||||||||||
Total investment securities held-to-maturity | 45,210 | 148 | (686 | ) | 44,672 | |||||||||||
Total investment securities | $ | 1,156,378 | $ | 6,411 | $ | (14,895 | ) | $ | 1,147,894 |
March 31, 2019 | |||||||||||||||||||||||||||||||||||
One Year or Less | More than One to Five Years | More than Five Years to Ten Years | More than Ten Years | Total | |||||||||||||||||||||||||||||||
Fair Value | Weighted Average Yield | Fair Value | Weighted Average Yield | Fair Value | Weighted Average Yield | Fair Value | Weighted Average Yield | Fair Value | Weighted Average Yield | ||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||||
Investment securities available-for-sale: | |||||||||||||||||||||||||||||||||||
U.S. Treasury | $ | 495 | 2.51 | % | $ | 10,214 | 2.95 | % | $ | 51,192 | 2.92 | % | $ | — | — | % | $ | 61,901 | 2.93 | % | |||||||||||||||
Agency | — | — | 33,108 | 3.08 | 87,279 | 3.12 | 45,101 | 3.22 | 165,488 | 3.14 | |||||||||||||||||||||||||
Corporate | — | — | — | — | 137,855 | 4.53 | — | — | 137,855 | 4.53 | |||||||||||||||||||||||||
Municipal bonds | 250 | 3.95 | 2,202 | 2.13 | 40,946 | 2.07 | 173,618 | 2.49 | 217,016 | 2.40 | |||||||||||||||||||||||||
Collateralized mortgage obligation | — | — | — | — | 2,916 | 2.46 | 20,535 | 2.55 | 23,451 | 2.54 | |||||||||||||||||||||||||
Mortgage-backed securities | — | — | 471 | 1.02 | 137,977 | 2.73 | 427,251 | 2.68 | 565,699 | 2.69 | |||||||||||||||||||||||||
Total securities available-for-sale | 745 | 2.99 | 45,995 | 2.99 | 458,165 | 3.31 | 666,505 | 2.66 | 1,171,410 | 2.93 | |||||||||||||||||||||||||
Investment securities held-to-maturity: | |||||||||||||||||||||||||||||||||||
Mortgage-backed securities | — | — | 947 | 3.05 | — | — | 41,222 | 3.20 | 42,169 | 3.20 | |||||||||||||||||||||||||
Other | — | — | — | — | — | — | 1,811 | 0.97 | 1,811 | 0.97 | |||||||||||||||||||||||||
Total securities held-to-maturity | — | — | 947 | 3.05 | — | — | 43,033 | 3.11 | 43,980 | 3.11 | |||||||||||||||||||||||||
Total securities | $ | 745 | 2.99 | % | $ | 46,942 | 2.99 | % | $ | 458,165 | 3.31 | % | $ | 709,538 | 2.69 | % | $ | 1,215,390 | 2.93 | % |
• | An evaluation of the present value of estimated cash flows from the security using the current yield to accrete beneficial interest and including assumptions in the prepayment rate, default rate, delinquencies, loss severity and percentage of nonperforming assets; |
• | An evaluation of the estimated payback period to recover principal; |
• | An analysis of the credit support available in the underlying security to absorb losses; and |
• | A review of the financial condition and near term prospects of the issuer. |
March 31, 2019 | December 31, 2018 | ||||||||||||||||||
Balance | % of Total Deposits | Weighted Average Rate | Balance | % of Total Deposits | Weighted Average Rate | ||||||||||||||
(dollars in thousands) | |||||||||||||||||||
Noninterest-bearing checking | $ | 3,423,893 | 39.3 | % | — | % | $ | 3,495,737 | 40.3 | % | — | % | |||||||
Interest-bearing deposits: | |||||||||||||||||||
Checking | 560,274 | 6.4 | 0.38 | 526,088 | 6.1 | 0.38 | |||||||||||||
Money market | 2,893,406 | 33.2 | 0.92 | 2,975,578 | 34.4 | 0.89 | |||||||||||||
Savings | 245,469 | 2.8 | 0.13 | 250,271 | 2.9 | 0.14 | |||||||||||||
Time deposit accounts: | |||||||||||||||||||
Less than 1.00% | 123,040 | 1.4 | 0.46 | 151,804 | 1.8 | 0.45 | |||||||||||||
1.00 - 1.99 | 423,004 | 4.9 | 1.62 | 531,469 | 6.1 | 1.63 | |||||||||||||
2.00 - 2.99 | 1,046,072 | 12.0 | 2.38 | 727,386 | 8.4 | 2.29 | |||||||||||||
3.00 - 3.99 | 17 | — | 3.73 | 16 | — | 3.73 | |||||||||||||
4.00 - 4.99 | — | — | 2 | — | 4.93 | ||||||||||||||
5.00 and greater | — | — | — | — | — | ||||||||||||||
Total time deposit accounts | 1,592,133 | 18.3 | 2.02 | 1,410,677 | 16.3 | 1.84 | |||||||||||||
Total interest-bearing deposits | 5,291,282 | 60.7 | 1.16 | 5,162,614 | 59.7 | 1.06 | |||||||||||||
Total deposits | $ | 8,715,175 | 100.0 | % | 0.70 | % | $ | 8,658,351 | 100.0 | % | 0.63 | % |
• | FHLB advances of $609.6 million at 2.56%; |
• | Subordinated notes of $60.0 million at 5.75% due September 3, 2024. For additional information about the subordinated notes, see Note 8 to the Consolidated Financial Statements in this report; |
• | Subordinated debentures used to fund the issuance of trust preferred securities in 2004 of $10.3 million at 5.54% due April 6, 2034. For additional information about the subordinated debentures and trust preferred securities, see Note 8 to the Consolidated Financial Statements in this report; |
• | $5.2 million of floating rate junior subordinated debt securities associated with Heritage Oaks Capital Trust II. At March 31, 2019, the carrying value of these debentures was $4.0 million, which reflects purchase accounting fair value adjustments of $1.25 million. Interest is payable quarterly at three-month LIBOR plus 1.72% per annum, for an effective rate of 4.52% per annum as of March 31, 2019. ; |
• | $3.1 million of floating rate junior subordinated debt associated with Mission Community Capital Trust I at March 31, 2019, the carrying value of this debt was $2.8 million, which reflects purchase accounting fair value adjustments of $301,000. Interest is payable quarterly at three-month LIBOR plus 2.95% per annum, for an effective rate of 5.74% per annum as of March 31, 2019; |
• | $5.2 million of floating rate junior subordinated debt associated Santa Lucia Bancorp (CA) Capital Trust at March 31, 2019, the carrying value of this debt was $3.8 million, which reflects purchase accounting fair value adjustments $1.3 million. Interest is payable quarterly at three-month LIBOR plus 1.48% per annum, for an effective rate of 4.27% per annum as of March 31, 2019; |
• | $25 million of subordinated notes at a fixed rate of 7.125% payable in arrears on a quarterly basis inherited as part of the 2017 acquisition of Plaza. At March 31, 2019, the carrying value of these notes was $25.2 million, which reflects purchase accounting fair value adjustments of $151,000. |
• | $5.2 million of floating rate junior subordinated debt securities associated with First Commerce Bancorp Statutory Trust I. At March 31, 2019, the carrying value of these debt securities was $4.9 million, which reflects purchase accounting fair value adjustments of $221,000.Interest is payable quarterly at three-month LIBOR plus 2.95% per annum, for an effective rate of 5.56% per annum as of March 31, 2019. |
March 31, 2019 | December 31, 2018 | ||||||||||||
Balance | Weighted Average Rate | Balance | Weighted Average Rate | ||||||||||
(dollars in thousands) | |||||||||||||
FHLB advances | $ | 609,591 | 2.56 | % | $ | 667,606 | 2.51 | % | |||||
Reverse repurchase agreements | — | — | 75 | 0.01 | |||||||||
Subordinated debentures | 110,381 | 6.10 | 110,313 | 6.04 | |||||||||
Total borrowings | $ | 719,972 | 3.10 | % | $ | 777,994 | 3.01 | % | |||||
Weighted average cost of borrowings during the quarter | 3.02 | % | 2.82 | % | |||||||||
Borrowings as a percent of total assets | 6.2 | 6.8 |
March 31, | December 31, | ||||||
2019 | 2018 | ||||||
(dollars in thousands) | |||||||
Total stockholders’ equity | $ | 2,007,064 | $ | 1,969,697 | |||
Less: Intangible assets | 904,846 | 909,282 | |||||
Tangible common equity | $ | 1,102,218 | $ | 1,060,415 | |||
Book value per share | $ | 31.97 | $ | 31.52 | |||
Less intangible book value per share | 14.41 | 14.55 | |||||
Tangible book value per share | $ | 17.56 | $ | 16.97 | |||
Total assets | $ | 11,580,495 | $ | 11,487,387 | |||
Less: Intangible assets | 904,846 | 909,282 | |||||
Tangible assets | $ | 10,675,649 | $ | 10,578,105 | |||
Tangible common equity ratio | 10.32 | % | 10.02 | % |
• | Proceeds of $168.8 million from the sale or maturity of securities available-for-sale; |
• | Principal payments on securities of 29.7 million; |
• | Principal payments on loans held for investment of $279.2 million; |
• | Proceeds of $27.6 million from the sale and principal payments on loans held for sale; and |
• | Brokered certificates of deposits as rates moved favorably to these funding sources compared with higher cost, overnight borrowing rates |
• | Originate loans held for investment of $392 million; |
• | Purchase available-for-sale securities of $227 million; and |
• | Originate loans held for sale of $32 million. |
March 31, 2019 | |||||||||||||||||||
Less than 1 year | 1 - 3 years | 3 - 5 years | More than 5 years | Total | |||||||||||||||
(dollars in thousands) | |||||||||||||||||||
Contractual obligations | |||||||||||||||||||
FHLB advances | $ | 565,500 | $ | 36,000 | $ | 8,091 | $ | — | $ | 609,591 | |||||||||
Other borrowings | — | — | — | — | — | ||||||||||||||
Subordinated debentures | — | — | — | 110,381 | 110,381 | ||||||||||||||
Certificates of deposit | 1,360,962 | 152,858 | 11,341 | 66,972 | 1,592,133 | ||||||||||||||
Operating leases | 10,962 | 17,415 | 15,532 | 9,689 | 53,598 | ||||||||||||||
Total contractual cash obligations | $ | 1,937,424 | $ | 206,273 | $ | 34,964 | $ | 187,042 | $ | 2,365,703 |
March 31, 2019 | |||||||||||||||||||
Less than 1 year | 1 - 3 years | 3 - 5 years | More than 5 years | Total | |||||||||||||||
(dollars in thousands) | |||||||||||||||||||
Other commitments | |||||||||||||||||||
Commercial and industrial | $ | 875,900 | $ | 204,465 | $ | 26,814 | $ | 47,366 | $ | 1,154,545 | |||||||||
Construction | 166,368 | 172,097 | 1,033 | 42,794 | 382,292 | ||||||||||||||
Agribusiness and farmland | 25,025 | 10,991 | 9,177 | 3,621 | 48,814 | ||||||||||||||
Home equity lines of credit | 9,706 | 3,195 | 8,258 | 64,264 | 85,423 | ||||||||||||||
Standby letters of credit | 19,245 | — | — | — | 19,245 | ||||||||||||||
Credit card lines | — | — | — | 1,518 | 1,518 | ||||||||||||||
All other | 33,755 | 11,195 | 15,835 | 33,064 | 93,849 | ||||||||||||||
Total other commitments | $ | 1,129,999 | $ | 401,943 | $ | 61,117 | $ | 192,627 | $ | 1,785,686 |
Actual | Minimum Required For Capital Adequacy Purposes | Minimum Required Plus Capital Conservation Buffer Phase-In for 2019 | Minimum Required Plus Capital Conservation Buffer Fully Phased-In | Minimum Required For Well Capitalized Requirement | ||||||
At March 31, 2019 | ||||||||||
Pacific Premier Bancorp, Inc. Consolidated | ||||||||||
Tier 1 leverage ratio | 10.69% | 4.00% | 4.00% | 4.00% | N/A | |||||
Common equity tier 1 capital ratio | 11.08% | 4.50% | 7.00% | 7.00% | N/A | |||||
Tier 1 capital ratio | 11.32% | 6.00% | 8.50% | 8.50% | N/A | |||||
Total capital ratio | 12.58% | 8.00% | 10.50% | 10.50% | N/A | |||||
Pacific Premier Bank | ||||||||||
Tier 1 leverage ratio | 11.39% | 4.00% | 4.00% | 4.00% | 5.00% | |||||
Common equity tier 1 capital ratio | 12.07% | 4.50% | 7.00% | 7.00% | 6.50% | |||||
Tier 1 capital ratio | 12.07% | 6.00% | 8.50% | 8.50% | 8.00% | |||||
Total capital ratio | 12.49% | 8.00% | 10.50% | 10.50% | 10.00% | |||||
Actual | Minimum Required For Capital Adequacy Purposes | Minimum Required Plus Capital Conservation Buffer Phase-In for 2018 | Minimum Required Plus Capital Conservation Buffer Fully Phased-In | Minimum Required For Well Capitalized Requirement | ||||||
At December 31, 2018 | ||||||||||
Pacific Premier Bancorp, Inc. Consolidated | ||||||||||
Tier 1 leverage ratio | 10.38% | 4.00% | 4.00% | 4.00% | N/A | |||||
Common equity tier 1 capital ratio | 10.88% | 4.50% | 6.38% | 7.00% | N/A | |||||
Tier 1 capital ratio | 11.13% | 6.00% | 7.88% | 8.50% | N/A | |||||
Total capital ratio | 12.39% | 8.00% | 9.88% | 10.50% | N/A | |||||
Pacific Premier Bank | ||||||||||
Tier 1 leverage ratio | 11.06% | 4.00% | 4.00% | 4.00% | 5.00% | |||||
Common equity tier 1 capital ratio | 11.87% | 4.50% | 6.38% | 7.00% | 6.50% | |||||
Tier 1 capital ratio | 11.87% | 6.00% | 7.88% | 8.50% | 8.00% | |||||
Total capital ratio | 12.28% | 8.00% | 9.88% | 10.50% | 10.00% |
Period | Total Number of Shares Purchased | Average price paid per share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Maximum Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs | ||||||||||
January 1, 2019 to January 31, 2019 | — | $ | — | — | $ | 100,000,000 | ||||||||
February 1, 2019 to February 28, 2019 | — | — | — | 100,000,000 | ||||||||||
March 1, 2019 to March 31, 2019 | — | — | — | 100,000,000 | ||||||||||
Total | — | — |
Exhibit 2.1 | ||
Exhibit 3.1 | ||
Exhibit 3.2 | ||
Exhibit 4.1 | ||
Exhibit 4.2 | ||
Exhibit 4.3 | ||
Exhibit 10.1 | ||
Exhibit 31.1 | ||
Exhibit 31.2 | ||
Exhibit 32 | ||
Exhibit 101.INS | XBRL Instance Document | |
Exhibit 101.SCH | XBRL Taxonomy Extension Schema Document | |
Exhibit 101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | |
Exhibit 101.DEF | XBRL Taxonomy Extension Definitions Linkbase Document | |
Exhibit 101.LAB | XBRL Taxonomy Extension Label Linkbase Document | |
Exhibit 101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document | |
(1) Incorporated by reference from the Registrant’s Form 8-K filed with the SEC on February 12, 2018. | ||
(2) Incorporated by reference from the Registrant’s Form 8-K filed with the SEC on May 15, 2018. | ||
(3) Incorporated by reference from the Registrant’s Form 8-K filed with the SEC on May 8, 2019. |
PACIFIC PREMIER BANCORP, INC., | |||
Date: | May 8, 2019 | By: | /s/ Steven R. Gardner |
Steven R. Gardner | |||
Chairman, President and Chief Executive Officer | |||
(Principal Executive Officer) | |||
Date: | May 8, 2019 | By: | /s/ Ronald J. Nicolas, Jr. |
Ronald J. Nicolas, Jr. | |||
Senior Executive Vice President and Chief Financial Officer | |||
(Principal Financial Officer) | |||
Date: | May 8, 2019 | By: | /s/ Lori Wright |
Lori Wright | |||
Executive Vice President and Chief Accounting Officer | |||
(Principal Accounting Officer) |
Company’s Performance Metric Percentile Performance Rank | Vesting Percentage of Target Restricted Stock Units Attributable to Performance Metric |
90th Percentile (the “maximum level”) | 200% of the Target Restricted Stock Units attributable to the Performance Metric |
75th Percentile | 150% of the Target Restricted Stock Units attributable to the Performance Metric |
50th Percentile (the “target level”) | 100% of the Target Restricted Stock Units attributable to the Performance Metric |
25th Percentile (the “threshold level”) | 50% of the Target Restricted Stock Units attributable to the Performance Metric |
Below 25th Percentile | None of the Target Restricted Stock Units attributable to the Performance Metric |
PACIFIC PREMIER BANCORP, INC., | |||
By: | /s/ Steven R. Gardner | ||
Steven R. Gardner | |||
Chairman, President and Chief Executive Officer |
1. | I have reviewed this quarterly report on Form 10-Q of Pacific Premier Bancorp, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Dated: | May 8, 2019 | /s/ Steven R. Gardner | ||
Steve Gardner | ||||
Chairman, President and Chief Executive Officer |
1. | I have reviewed this quarterly report on Form 10-Q of Pacific Premier Bancorp, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Dated: | May 8, 2019 | /s/ Ronald J. Nicolas, Jr. | ||
Ronald J. Nicolas, Jr. | ||||
Sr. Executive Vice President and Chief Financial Officer |
a) | the Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and |
b) | the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Pacific Premier Bancorp, Inc. | |
/s/ Steven R. Gardner | |
Steven R. Gardner | |
Chairman, President and | |
Chief Executive Officer | |
/s/ Ronald J. Nicolas, Jr. | |
Ronald J. Nicolas, Jr. | |
Sr. Executive Vice President and | |
Chief Financial Officer |
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Document and Entity Information - shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
May 03, 2019 |
|
Document and Entity Information | ||
Entity Registrant Name | PACIFIC PREMIER BANCORP INC | |
Entity Central Index Key | 0001028918 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2019 | |
Amendment Flag | false | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 62,689,976 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 |
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Parenthetical) - USD ($) $ in Thousands |
Mar. 31, 2019 |
Dec. 31, 2018 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Investments held-to-maturity, fair value | $ 43,980 | $ 44,672 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 150,000,000 | 150,000,000 |
Common stock, shares issued (in shares) | 62,773,299 | 62,480,755 |
Common stock, shares outstanding (in shares) | 62,773,299 | 62,480,755 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands |
3 Months Ended | |||||||
---|---|---|---|---|---|---|---|---|
Mar. 31, 2019 |
Dec. 31, 2018 |
Mar. 31, 2018 |
||||||
Statement of Comprehensive Income [Abstract] | ||||||||
Net income | $ 38,718 | $ 39,643 | $ 28,002 | |||||
Other comprehensive income, net of tax: | ||||||||
Unrealized holding (loss)/gain on securities arising during the period, net of income taxes | [1] | 10,967 | 11,076 | (9,343) | ||||
Reclassification adjustment for net (gains) losses on sale of securities included in net income, net of income taxes | [2] | (306) | 0 | (5) | ||||
Other comprehensive income (loss), net of tax | 10,661 | 11,076 | (9,348) | |||||
Comprehensive income, net of tax | $ 49,379 | $ 50,719 | $ 18,654 | |||||
|
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2019 |
Dec. 31, 2018 |
Mar. 31, 2018 |
|
Statement of Comprehensive Income [Abstract] | |||
Unrealized holding (loss)/gain on securities arising during the period, income tax expense (benefit) | $ 4,500 | $ 4,600 | $ (3,900) |
Reclassification adjustment for net (gains) losses on sale of securities included in net income, income tax expense (benefit) | $ 121 | $ 0 | $ 1 |
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) |
3 Months Ended |
---|---|
Mar. 31, 2019
$ / shares
| |
Statement of Stockholders' Equity [Abstract] | |
Cash dividends declared (in dollars per share) | $ 0.22 |
Dividend equivalents declared (in dollars per share) | $ 0.22 |
Basis of Presentation |
3 Months Ended |
---|---|
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The consolidated financial statements include the accounts of Pacific Premier Bancorp, Inc. (the “Corporation”) and its wholly owned subsidiaries, including Pacific Premier Bank (the “Bank”) (collectively, the “Company,” “we,” “our” or “us”). All significant intercompany accounts and transactions have been eliminated in consolidation. In the opinion of management, the consolidated financial statements contain all adjustments (consisting of normal recurring accruals) necessary to present fairly the Company’s financial position as of March 31, 2019 and December 31, 2018, the results of its operations and comprehensive income for the three months ended March 31, 2019, December 31, 2018 and March 31, 2018, and the changes in stockholders’ equity and cash flows for the three months ended March 31, 2019 and 2018. Operating results or comprehensive income for the three months ended March 31, 2019 are not necessarily indicative of the results or comprehensive income that may be expected for any other interim period or the full year ending December 31, 2019. Certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 (the “2018 Annual Report”). |
Recently Issued Accounting Pronouncements |
3 Months Ended | ||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2019 | |||||||||||||||||||||||||
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |||||||||||||||||||||||||
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements Accounting Standards Adopted in 2019 In March 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU” or “Update”) 2017-08, Receivables-Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchase Callable Debt Securities. This Update amends guidance on the amortization period of premiums on certain purchased callable debt securities. The amendments shorten the amortization period of premiums on purchased callable debt securities to the earliest call date. This Update should be applied on a modified retrospective basis through a cumulative-effect adjustment to beginning retained earnings. The effective date of ASU 2017-08 is for interim and annual reporting periods beginning after December 15, 2018. The adoption of this standard did not have a material effect on the Company’s operating results or financial condition. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), ASU 2018-11, Leases (Topic 842): Targeted Improvements, ASU 2018-10, Codification Improvements to Topic 842, Leases. This Update is being issued to increase the transparency and comparability around lease obligations. Previously unrecorded off-balance sheet obligations and corresponding rights to use underlying leased assets will now be recorded in the consolidated financial statements, accompanied by enhanced qualitative and quantitative disclosures in the notes to the consolidated financial statements. The Update is generally effective for public business entities in fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. In July 2018, the FASB issued ASU 2018-10, Codification Improvements to Topic 842, Leases and ASU 2018-11, Leases (Topic 842): Targeted Improvements. ASU 2018-10 provides improvements related to ASU 2016-02 to increase stakeholders’ awareness of the amendments to Topic 842 and to expedite the improvements. The amendments affect narrow aspects of the guidance issued in ASU 2016-02. ASU 2018-11 allows entities adopting ASU 2016-02 to choose an additional transition method, under which an entity initially applies the accounting guidance for leases under Topic 842 at the adoption date and recognizes a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. Additionally, ASU 2018-11 allows an entity electing this additional transition method to continue to present comparative period financial statements in accordance with Topic 840 (current U.S. GAAP). ASU 2018-11 also allows lessors to not separate non-lease components from the associated lease component if certain conditions are met. The amendments in these updates became effective for annual periods as well as interim periods within those annual periods beginning after December 15, 2018. The Company elected to apply the transition provisions of Topic 842 using the alternative transition method whereby comparative periods are not restated. The Company also elected to adopt the “package” of practical expedients in its transition to Topic 842, as specified in ASC 842-10-65. The results of this policy election are that the Company reflected the provisions of Topic 842 in its consolidated financial statements for the first time as of and for the period ended March 31, 2019 (the period of adoption). The Company measured and recorded liabilities to make lease payments as well as right-of-use assets in the period of adoption for leases that existed as of the transition date, and will continue to present all comparative periods under Topic 840. Under this elected transition method, the Company is not required to reassess the following as part of its transition to Topic 842: (1) whether any expired or existing contracts contain leases, (2) lease classifications for any existing or expired leases and (3) initial direct costs for any existing leases. Additionally, the Company elected to apply the use of hindsight in its assessment of the term for its leases upon transition, which allows for consideration of the Company’s option to extend or terminate a lease. The Company adopted the provisions of Topic 842 on January 1, 2019, and in its transition Topic 842, the Company initially recorded a liability to make future lease payments of approximately $45.7 million and right-of-use assets of approximately $43.8 million. The difference of $1.9 million is the accounting adjustments previously recorded under Topic 840 and Topic 805, as required by transition guidance in ASC 842-10-65. The Company was not required to record a cumulative effect adjustment to the opening balance of retained earnings as part of its transition to Topic 842. The Company’s evaluation of lease obligations and service agreements under the new standard included an assessment of the appropriate classification and related accounting of each lease agreement, a review of applicability of the new standard to existing service agreements and gathering all essential lease data to facilitate the application of the new standard. The Company’s review indicated that all of its leases are classified as operating leases or short-term leases. In accordance with the provisions of Topic 842, liabilities to make future lease payments and right-of-use assets are only recorded for leases that are not considered short-term (leases with an original term of greater than 12 months). The Company records expense for its leases on a straight-line basis in accordance with the requirements under Topic 842 for operating leases. The Company’s expense recognition for its operating leases (including short-term leases) under Topic 842 has not differed significantly from that recorded under Topic 840. Right-of-use assets for operating leases are amortized over the lease term and liabilities to make future lease payments are accounted for using the interest method, both in accordance with Topic 842. Please also refer to Note 13 - Leases for additional information related to the Company’s leases. Recent Accounting Guidance Not Yet Effective In March 2019, the FASB issued ASU 2019-01, Leases (Topic 842): Codification Improvements. This Update provides clarification on certain aspects of an entity’s implementation of Topic 842 including those that relate to: (1) Determining the fair value of the underlying asset by lessors that are not manufacturers or dealers. The amendments related to this item carry forward from Topic 840 to Topic 842 an exception that allows lessors who are not manufacturers or dealers to use the cost of the underlying asset as its fair value. (2) Presentation on the statement of cash flows - sales-type and direct financing leases. The amendments related to this item clarify that all principal payments received on leases by lessors in sales-type or direct financing lease transactions should be reflected in investing activities for entities such as depository and lending institutions within in the scope of Topic 942. (3) Transition disclosures related to Topic 250, Accounting Changes and Error Corrections. The amendments related to this item clarify the FASB’s original intent by explicitly providing an exception to the paragraph 250-10-50-3 interim disclosure requirements in the Topic 842 transition disclosure requirements, which would otherwise require interim disclosures after the date of adoption of Topic 842 related to the impacts of the change on: (a) income from continuing operations, (b) net income, (c) any other financial statement line item and (d) any affected per-share amounts. The amendments in this Update are effective for public business entities for fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020. Early adoption is permitted. The Company does not believe the effects of this ASU will have a material effect on the Company’s financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement. The amendments in this Update modify the disclosure requirements on fair value measurements in Topic 820, Fair Value Measurement. The following disclosure requirements for public companies were removed from Topic 820:
The following disclosure requirements for public companies were modified in Topic 820:
The following disclosure requirements for public companies were added to Topic 820:
The amendments in this Update are effective for public business entities for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. Early adoption is permitted. In addition, an entity may early adopt any of the removed or modified disclosures immediately and delay adoption of the new disclosures until the effective date. The Company is currently evaluating the effects of ASU 2018-13 on its financial statements and disclosures. |
Significant Accounting Policies |
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Accounting Policies [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies Our accounting policies are described in Note 1. Description of Business and Summary of Significant Accounting Policies, of our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2018 as filed with the Securities and Exchange Commission (“Form 10-K”). Select policies have been reiterated below that have a particular affiliation to our interim financial statements. Revenue Recognition – The Company accounts for certain of its revenue streams in accordance with ASC 606 - Revenue from Contracts with Customers. Revenue streams within the scope of and accounted for under ASC 606 include: service charges and fees on deposit accounts, debit card interchange fees, fees from other services the Bank provides its customers and gains and losses from the sale of other real estate owned and property, premises and equipment. ASC 606 requires revenue to be recognized when the Company satisfies related performance obligations by transferring to the customer a good or service. The recognition of revenue under ASC 606 requires the Company to first identify the contract with the customer, identify the performance obligations, determine the transaction price, allocate the transaction price to the performance obligations and finally recognize revenue when the performance obligations have been satisfied and the good or service has been transferred. The majority of the Company’s contracts with customers associated with revenue streams that are within the scope of ASC 606 are considered short-term in nature and can be canceled at any time by the customer or the Bank, such as a deposit account agreement. Other more significant revenue streams for the Company such as interest income on loans and investment securities are specifically excluded from the scope of ASC 606 and are accounted for under other applicable U.S. GAAP. Goodwill and Core Deposit Intangible – Goodwill is generally determined as the excess of the fair value of the consideration transferred, plus the fair value of any noncontrolling interests in the acquiree, over the fair value of the net assets acquired and liabilities assumed as of the acquisition date. Goodwill and intangible assets acquired in a purchase business combination and determined to have an indefinite useful life are not amortized, but tested for impairment at least annually or more frequently if events and circumstances exist that indicate the necessity for such impairment tests to be performed. The Company has selected the fourth quarter as the period to perform the annual impairment test. Intangible assets with definite useful lives are amortized over their estimated useful lives to their estimated residual values. Goodwill is the only intangible asset with an indefinite life on our balance sheet. Core deposit intangible assets arising from whole bank acquisitions are amortized on either an accelerated basis, reflecting the pattern in which the economic benefits of the intangible assets is consumed or otherwise used up, or on a straight-line amortization method over their estimated useful lives, which range from 6 to 10 years. Leases – The Company accounts for its leases in accordance with ASC 842, which requires the Company to record liabilities for future lease obligations as well as assets representing the right to use the underlying leased asset. Leases with a term of 12 months or less are accounted for using straight-line expense recognition with no liability or asset being recorded for such leases. Other than short-term leases, the Company classifies its leases as either finance leases or operating leases. Leases are classified as finance leases when any of the following are met: (a) the lease transfers ownership of the underlying asset to the Company by the end of the lease term, (b) the lease contains an option to purchase the underlying asset that the Company is reasonably certain to exercise, (c) the term of the lease represents a major part of the remaining life of the underlying asset, (d) the present value of the future lease payments equals or exceeds substantially all of the fair value of the underlying asset, or (e) the underling leased asset is expected to have no alternative use to the lessor at the end of the lease term due to its specialized nature. When the Company’s assessment of a lease does not meet the foregoing criteria, and the term of the lease is in excess of 12 months, the lease is classified as an operating lease. Liabilities to make lease payments and right-of-use assets are determined based on the total contractual base rents for each lease, discounted at the rate implicit in the lease or at the Company’s estimated incremental borrowing rate if the rate is not implicit in the lease. The Company measures future base rents based on the minimum payments specified in the lease agreement, giving consideration for periodic contractual rent increases which are based on an escalation rate or a specified index. When future rent payments are based on an index, the Company uses the index rate observed at the time of lease commencement to measure future lease payments. Liabilities to make lease payments are accounted for using the interest method, which are reduced by periodic rent payments, net of interest accretion. Right-of-use assets for finance leases are amortized on a straight-line basis over the term of the lease, while right-of-use assets for operating leases are amortized over the term of the lease by amounts that represent the difference between periodic straight-line lease expense and periodic interest accretion on the related liability to make lease payments. Expense recognition for finance leases is representative of the sum of periodic amortization of the associated right-of-use asset as well as the periodic interest accretion on the liability to make lease payments. Expense recognition for operating leases is recorded on a straight-line basis. As of March 31, 2019, all of the Company’s leases were classified as either operating leases or short-term leases. From time to time the Company leases portions of the space it leases to other parties through sublease transactions. Income received from these transactions is recorded on a straight-line basis over the term of the sublease. |
Acquisitions |
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Acquisitions | Acquisitions Grandpoint Capital, Inc. Acquisition Effective as of July 1, 2018, the Company completed the acquisition of Grandpoint Capital, Inc. (“Grandpoint”), the holding company of Grandpoint Bank, a California-chartered bank, with $3.1 billion in total assets, $2.4 billion in gross loans and $2.5 billion in total deposits at June 30, 2018. Pursuant to the terms of the merger agreement, each outstanding share of Grandpoint voting common stock and Grandpoint non-voting common stock was converted into the right to receive 0.4750 shares of the Corporation’s common stock. The final value of the total transaction consideration was approximately $602.2 million, after approximately $28.1 million in aggregate cash consideration payable to holders of Grandpoint share-based compensation awards by Grandpoint. The transaction consideration represented the issuance of 15,758,089 shares of the Corporation’s common stock, valued at $38.15 per share, which was the closing price of the Corporation’s common stock on June 29, 2018, the last trading day prior to the consummation of the Merger. Goodwill in the amount of $313.0 million was recognized in the Grandpoint acquisition. Goodwill represents the future economic benefits arising from net assets acquired that are not individually identified and separately recognized and is attributable to synergies expected to be derived from the combination of the two entities. Goodwill recognized in this transaction is not deductible for income tax purposes. The following table represents the assets acquired and liabilities assumed of Grandpoint as of July 1, 2018 and the fair value adjustments and amounts recorded by the Company in 2018 under the acquisition method of accounting:
Such fair values are preliminary estimates and subject to refinement for up to one year after the closing date of acquisition as additional information relative to the closing date fair values becomes available and such information is considered final, whichever is earlier. Fair value adjustments will be finalized no later than July 2019. The Company accounted for this transaction under the acquisition method of accounting in accordance with ASC 805, Business Combinations, which requires purchased assets and liabilities assumed to be recorded at their respective fair values at the date of acquisition. The loan portfolios of Grandpoint was recorded at fair value at the date of each acquisition. A valuation of Grandpoint’s loan portfolio was performed by a third party as of the acquisition dates to assess the fair value of the loan portfolio. The loan portfolio was both segmented into two groups; loan with credit deterioration and loans without credit deterioration, and then split further by loan type. The fair value was calculated on an individual loan basis using a discounted cash flow analysis. The discount rate utilized was based on a weighted average cost of capital, considering the cost of equity and cost of debt. Also factored into the fair value estimates were loss rates, recovery periods and prepayment rates based on industry standards. The Company also determined the fair value of the core deposit intangible, securities, real property, leases, deposits and long-term borrowings with the assistance of third-party valuations. The fair value of other real estate owned (“OREO”) was based on recent appraisals of the properties less estimated costs to sell. The core deposit intangible on non-maturing deposits was determined by evaluating the underlying characteristics of the deposit relationships, including customer attrition, deposit interest rates, service charge income, overhead expense and costs of alternative funding. Since the fair value of intangible assets are calculated as if they were stand-alone assets, the presumption is that a hypothetical buyer of the intangible asset would be able to take advantage of potential tax benefits resulting from the asset purchase. The value of the benefit is the present value over the period of the tax benefit, using the discount rate applicable to the asset. In determining the fair value of certificates of deposit, a discounted cash flow analysis was used, which involved present valuing the contractual payments over the remaining life of the certificates of deposit at market-based interest rates. For loans acquired from Grandpoint, the contractual amounts due, expected cash flows to be collected, interest component and fair value as of acquisition date was as follows:
In accordance with U.S. GAAP, there was no carryover of the allowance for loan losses that had been previously recorded by Grandpoint. The operating results of the Company for the three months ended March 31, 2019 and December 31, 2018 include the operating results of Grandpoint since its acquisition date. The following table presents the net interest and other income, net income and earnings per share as if the acquisition was effective as of January 1, 2018 for the three months ended March 31, 2019, December 31, 2018 and March 31, 2018. There were no material, nonrecurring adjustments to the pro forma net interest and other income, net income and earnings per share presented below:
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Investment Securities |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investment Securities | Investment Securities The amortized cost and estimated fair value of securities were as follows:
Unrealized gains and losses on investment securities available-for-sale are recognized in stockholders’ equity as accumulated other comprehensive income or loss. At March 31, 2019, the Company had an accumulated other comprehensive income of $7.1 million, or $5.1 million net of tax, compared to an accumulated other comprehensive loss of $7.9 million, or $5.6 million net of tax, at December 31, 2018. During the first quarter of March 31, 2019, the Bank no longer has HOA reverse repurchase agreements and unpledged all the supporting mortgage-backed securities. At December 31, 2018, mortgage-backed securities with an estimated par value of $20.3 million and a fair value of $20.9 million were pledged as collateral for the Bank’s HOA reverse repurchase agreements, which totaled $75,000. The average balance of repurchase agreement facilities was $15.0 million during the year ended December 31, 2018. At March 31, 2019 and December 31, 2018, there were no holdings of securities of any one issuer, other than the U.S. Government and its agencies, in an amount greater than 10% of stockholders’ equity. The Company reviews individual securities classified as available-for-sale to determine whether a decline in fair value below the amortized cost basis is temporary because (i) those declines were due to interest rate changes and not to a deterioration in the creditworthiness of the issuers of those investment securities, and (ii) we have the ability to hold those securities until there is a recovery in their values or until their maturity. If it is probable that the Company will be unable to collect all amounts due according to contractual terms of the debt security not impaired at acquisition, an other-than-temporary impairment (“OTTI”) shall be considered to have occurred. If an OTTI occurs, the cost basis of the security will be written down to its fair value as the new cost basis and the write down accounted for as a realized loss. There were no OTTI for the three months ended March 31, 2019, December 31, 2018 or March 31, 2018. The table below shows the number, fair value and gross unrealized holding losses of the Company’s investment securities by investment category and length of time that the securities have been in a continuous loss position.
The amortized cost and estimated fair value of investment securities at March 31, 2019, by contractual maturity are shown in the table below.
During the three months ended March 31, 2019 and March 31, 2018, the Company recognized gross gains on sales of available-for-sale securities in the amount of $1.0 million and $6,000, respectively. During the three months ended December 31, 2018, the Company did not recognize any gross gains on sales of available-for-sale securities. During the three months ended March 31, 2019, the Company recognized gross losses on sales of available-for-sale securities in the amount of $615,000. The Company did not recognize any gross losses on the sales of available-for sale securities during the three months ended December 31, 2018 and March 31, 2018. The Company had net proceeds from the sale of available-for-sale securities of $168.8 million during the three months ended March 31, 2019. The Company had no net proceeds from the sale of available-for-sale securities during the three months ended December 31, 2018 and March 31, 2018. FHLB, FRB and other stock At March 31, 2019, the Company had $18.9 million in Federal Home Loan Bank of San Francisco (“FHLB”) stock, $51.6 million in Federal Reserve Bank of San Francisco (“FRB”) stock, and $24.3 million in other stock, all carried at cost. During the three months ended March 31, 2019 and December 31, 2018, the FHLB repurchased $12.9 million and $9.9 million, respectively, of the Company’s excess FHLB stock through their stock repurchase program. During the three months ended March 31, 2018, the FHLB did not repurchase any of the Company’s excess FHLB stock through their stock repurchase program. |
Loans Held for Investment |
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loans Held for Investment | Loans Held for Investment The following table sets forth the composition of our loan portfolio in dollar amounts at the dates indicated:
______________________________ (1) Secured by real estate. (2) Includes second trust deeds. (3) Total gross loans held for investment for March 31, 2019 and December 31, 2018 are net of the unaccreted fair value net purchase discounts of $57.2 million and $61.0 million, respectively. Loans Serviced for Others The Company generally retains the servicing rights of the guaranteed portion of Small Business Administration (“SBA”) loans sold, for which the Company records a servicing asset at fair value within its other assets category. At March 31, 2019 and December 31, 2018, the servicing asset totaled $8.3 million and $8.5 million, respectively, and was included in other assets. Servicing rights are evaluated for impairment based upon the fair value of the rights as compared to the carrying amount. Impairment is recognized through a valuation allowance, to the extent the fair value is less than the carrying amount. At March 31, 2019 and December 31, 2018, the Company determined that no valuation allowance was necessary. Loans serviced for others are not included in the accompanying consolidated statements of financial condition. The unpaid principal balance of loans and participations serviced for others were $676.7 million at March 31, 2019 and $635.3 million at December 31, 2018, including SBA participations serviced for others totaling $516.4 million at March 31, 2019 and $519.8 million at December 31, 2018. Concentration of Credit Risk As of March 31, 2019, the Company’s loan portfolio was primarily collateralized by various forms of real estate and business assets located predominately in California. The Company’s loan portfolio contains concentrations of credit in multi-family real estate, commercial non-owner occupied real estate and commercial owner occupied real estate and business loans. The Bank maintains policies approved by the Bank’s Board of Directors (the “Bank Board”) that address these concentrations and diversifies its loan portfolio through loan originations, purchases and sales to meet approved concentration levels. While management believes that the collateral presently securing these loans is adequate, there can be no assurances that a significant deterioration in the California real estate market or economy would not expose the Company to significantly greater credit risk. Under applicable laws and regulations, the Bank may not make secured loans to one borrower in excess of 25% of the Bank’s unimpaired capital plus surplus and likewise in excess of 15% of the Bank’s unimpaired capital plus surplus for unsecured loans. These loans-to-one borrower limitations result in a dollar limitation of $536.2 million for secured loans and $321.7 million for unsecured loans at March 31, 2019. At March 31, 2019, the Bank’s largest aggregate outstanding balance of loans to one borrower was $94.1 million of secured credit. Credit Quality and Credit Risk Management The Company’s credit quality and credit risk is controlled in two distinct areas. The first is the loan origination process, wherein the Bank underwrites credit quality and chooses which risks it is willing to accept. The second is in the ongoing oversight of the loan portfolio, where existing credit risk is measured and monitored, and where performance issues are dealt with in a timely and comprehensive fashion. The Company maintains a comprehensive credit policy, which sets forth maximum tolerances for key elements of loan risk. The policy identifies and sets forth specific guidelines for analyzing each of the loan products the Company offers from both an individual and portfolio-wide basis. The credit policy is reviewed annually by the Bank Board. The Bank’s underwriters ensure key risk factors are analyzed with nearly all underwriting including a comprehensive global cash flow analysis of the prospective borrowers. Credit risk is managed within the loan portfolio by the Company’s portfolio managers based on a comprehensive credit and portfolio review policy. This policy requires a program of financial data collection and analysis, comprehensive loan reviews, property and/or business inspections and monitoring of portfolio concentrations and trends. The portfolio managers also monitor borrowing bases under asset-based lines of credit, loan covenants, and other conditions associated with the Company’s business loans as a means to help identify potential credit risk. Individual loans, excluding the homogeneous loan portfolio, are reviewed at least every two years and in most cases, more often, including the assignment of a risk grade. Risk grades are based on a six-grade Pass scale, along with Special Mention, Substandard, Doubtful and Loss classifications, as such classifications are defined by the regulatory agencies. The assignment of risk grades allows the Company to, among other things, identify the risk associated with each credit in the portfolio, and to provide a basis for estimating credit losses inherent in the portfolio. Risk grades are reviewed regularly with the Company’s Credit and Portfolio Review Committee, and are reviewed annually by an independent loan review function, as well as by regulatory agencies during scheduled examinations. The following provides brief definitions for risk grades assigned to loans in the portfolio:
The Bank’s portfolio managers also manage loan performance risks, collections, workouts, bankruptcies and foreclosures. Loan performance risks are mitigated by our portfolio managers acting promptly and assertively to address problem credits when they are identified. Collection efforts commence immediately upon non-payment, and the portfolio managers seek to promptly determine the appropriate steps to minimize the Company’s risk of loss. When foreclosure will maximize the Company’s recovery for a non-performing loan, the portfolio managers will take appropriate action to initiate the foreclosure process. When a loan is graded as Special Mention, Substandard or Doubtful, the Company obtains an updated valuation of the underlying collateral. If the credit in question is also identified as impaired, a valuation allowance, if necessary, is established against such loan or a loss is recognized by a charge to the allowance for loan losses (“ALLL”) if management believes that some or all of the full amount of the Company’s recorded investment in the loan is no longer collectable. The Company typically obtains or confirms updated valuations of underlying collateral for Special Mention and classified loans on an annual basis in order to have the most current indication of fair value. Once a loan is identified as impaired, an analysis of the underlying collateral is performed at least quarterly, and corresponding changes in any related valuation allowance are made or balances deemed to be fully uncollectable are charged-off. The following tables stratify the loan portfolio by the Company’s internal risk grading as of the periods indicated:
The following tables set forth delinquencies in the Company’s loan portfolio at the dates indicated:
Impaired Loans The Company considers a loan to be impaired when, based on current information and events, it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement or it is determined that the likelihood of the Company receiving all scheduled payments, including interest, when due is remote. The Company has no commitments to lend additional funds to debtors whose loans have been impaired. The Company reviews loans for impairment when the loan is classified as Substandard or worse, delinquent 90 days, determined by management to be collateral dependent, or when the borrower files bankruptcy or is granted a troubled debt restructuring (“TDR”). Measurement of impairment is based on the loan’s expected future cash flows discounted at the loan’s effective interest rate, measured by reference to an observable market value, if one exists, or the fair value of the collateral if the loan is deemed collateral dependent. Loans are generally charged-off at such time the loan is classified as a loss. Valuation allowances are determined on a loan-by-loan basis or by aggregating loans with similar risk characteristics. The following tables provide a summary of the Company’s investment in impaired loans as of the period indicated:
The following table presents information on impaired loans and leases, disaggregated by class, for the periods indicated:
The following table provides additional detail on the components of impaired loans at the period end indicated:
When loans are placed on nonaccrual status, previously accrued but unpaid interest is reversed from earnings. Payments received on nonaccrual loans are generally applied as a reduction to the loan principal balance. If the likelihood of further loss is remote, the Company will recognize interest on a cash basis only. Loans may be returned to accruing status if the Company believes that all remaining principal and interest is fully collectible and there has been at least three months of sustained repayment performance since the loan was placed on nonaccrual. The Company does not accrue interest on loans 90 days or more past due or when, in the opinion of management, there is reasonable doubt as to the timely collection of principal or interest. The Company had impaired loans on nonaccrual status of $12.9 million at March 31, 2019 and $4.9 million at December 31, 2018. The Company had $162,000 in loans 90 days or more past due and still accruing at March 31, 2019, all of which were PCI loans. Income recognition for PCI loans is accounted for in accordance with ASC Subtopic 310-30 Receivables-Loans and Debt Securities Acquired with Deteriorated Credit Quality. The Company had $213 thousand in loans 90 days or more past due and still accruing at December 31, 2018. There were no TDRs at March 31, 2019 and December 31, 2018. The Company had no consumer mortgage loans collateralized by residential real estate property for which formal foreclosure proceedings were in process as of March 31, 2019 and December 31, 2018. Purchased Credit Impaired Loans The Company has purchased loans that have experienced deterioration of credit quality between origination and acquisition and for which it was probable, at acquisition, that not all contractually required payments would be collected. The carrying amount of those loans is as follows:
On each acquisition date, the amount by which the undiscounted expected cash flows of the purchased credit impaired loans exceed the estimated fair value of the loan is the “accretable yield.” The accretable yield is measured at each financial reporting date and represents the difference between the remaining undiscounted expected cash flows and the current carrying value of the purchased credit impaired loan. At March 31, 2019, the Company had $2.1 million of purchased credit impaired loans, of which none were placed on nonaccrual status. The following table summarizes the accretable yield on the purchased credit impaired loans for the three month periods indicated.
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Allowance for Loan Losses |
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Provision for Loan and Lease Losses [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Allowance for Loan Losses | Allowance for Loan Losses The Company’s ALLL covers estimated credit losses on individually evaluated loans that are determined to be impaired as well as estimated probable incurred losses inherent in the remainder of the loan portfolio. The ALLL is prepared using the information provided by the Company’s credit review process together with data from peer institutions and economic information gathered from published sources. The loan portfolio is segmented into groups of loans with similar risk characteristics. Each segment possesses varying degrees of risk based on, among other things, the type of loan, the type of collateral, and the sensitivity of the borrower or industry to changes in external factors such as economic conditions. An estimated loss rate calculated using the Company’s actual historical loss rates adjusted for current portfolio trends, economic conditions and other relevant internal and external factors, is applied to each group’s aggregate loan balances. The Company’s base ALLL factors are determined by management using the Bank’s annualized actual trailing charge-off data over a full credit cycle with the loss emergence period extending from 1 year to 1.6 years. Adjustments to those base factors are made for relevant internal and external factors. Those factors may include:
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Subordinated Debentures |
3 Months Ended |
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Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Subordinated Debentures | Subordinated Debentures In August 2014, the Corporation issued $60 million in aggregate principal amount of 5.75% Subordinated Notes Due 2024 (the “Notes”) in a private placement transaction to institutional accredited investors (the “Private Placement”). The Corporation contributed $50 million of net proceeds from the Private Placement to the Bank to support general corporate purposes. The Notes bear interest at an annual fixed rate of 5.75%, with the first interest payment on the Notes occurring on March 3, 2015, and interest to be paid semiannually each March 3rd and September 3rd until September 3, 2024. At March 31, 2019, the carrying value of the Notes was $59.3 million, net of unamortized debt issuance cost of $658,000. As of March 31, 2019, the Notes qualify as Tier 2 Capital. Principal and interest are due upon early redemption. In connection with the Private Placement, the Corporation obtained ratings from Kroll Bond Rating Agency (“KBRA”). KBRA assigned investment grade ratings of BBB+ and BBB for the Corporation’s senior unsecured debt and subordinated debt, respectively, and a senior deposit rating of A- for the Bank. These ratings were reaffirmed by in April 2019 by KBRA. In March 2004, the Corporation issued $10.3 million of Floating Rate Junior Subordinated Deferrable Interest Debentures (the “Subordinated Debentures”) to PPBI Trust I, statutory trust created under the laws of the State of Delaware. The Debt Securities are subordinated to effectively all borrowings of the Corporation and are due and payable on April 6, 2034. Interest is payable quarterly on the Subordinated Debentures at three-month LIBOR plus 2.75% per annum, for an effective rate of 5.54% per annum, as of March 31, 2019. The Subordinated Debentures may be redeemed, in part or whole, on or after April 7, 2009 at the option of the Corporation, at par. The Subordinated Debentures can also be redeemed at par if certain events occur that impact the tax treatment or the capital treatment of the issuance. The Corporation also purchased a 3% minority interest totaling $310,000 in PPBI Trust I. The balance of equity of PPBI Trust I is comprised of mandatorily redeemable securities (“Trust Preferred Securities”) and is included in the Corporation’s other assets category. PPBI Trust I sold $10.0 million of Trust Preferred Securities to investors in a private offering. On April 1, 2017, as part of the HEOP acquisition, the Corporation assumed $5.2 million of floating rate junior subordinated debt securities associated with Heritage Oaks Capital Trust II. Interest is payable quarterly at three-month LIBOR plus 1.72% per annum, for an effective rate of 4.52% per annum as of March 31, 2019. At March 31, 2019, the carrying value of these debentures was $4.0 million, which reflects purchase accounting fair value adjustments of $1.2 million. The Corporation also assumed $3.1 million and $5.2 million of floating rate junior subordinated debt associated with Mission Community Capital Trust I and Santa Lucia Bancorp (CA) Capital Trust, respectively. At March 31, 2019, the carrying value of Mission Community Capital Trust I and Santa Lucia Bancorp (CA) Capital Trust were $2.8 million and $3.8 million, respectively, which reflects purchase accounting fair value adjustments of $301,000 and $1.3 million, respectively. Interest is payable quarterly at three-month LIBOR plus 2.95% per annum, for an effective rate of 5.74% per annum as of March 31, 2019 for Mission Community Capital Trust I. Interest is payable quarterly at three-month LIBOR plus 1.48% per annum, for an effective rate of 4.27% per annum as of March 31, 2019 for Santa Lucia Bancorp (CA) Capital Trust. These three debentures are callable by the Corporation at par. On November 1, 2017, as part of the Plaza acquisition, the Corporation assumed three subordinated notes totaling $25.0 million at a fixed interest rate of 7.125% payable in arrears on a quarterly basis. The notes have a maturity date of June 26, 2025 and are also redeemable in whole or in part beginning on June 26, 2020 at an amount equal to 103.0% of principal plus accrued unpaid interest. The redemption price decreases 50 basis points each subsequent year. At March 31, 2019, the carrying value of these subordinated notes was $25.2 million, which reflects purchase accounting fair value adjustments of $151,000. On July 1, 2018, as part of the Grandpoint acquisition, the Corporation assumed $5.2 million of floating rate junior subordinated debt securities associated with First Commerce Bancorp Statutory Trust I. Interest is payable quarterly at three-month LIBOR plus 2.95% per annum, for an effective rate of 5.56% per annum as of March 31, 2019. At March 31, 2019, the carrying value of these debentures was $4.9 million, which reflects purchase accounting fair value adjustments of $221,000. |
Earnings Per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share | Earnings Per Share In February 2019, the Company’s Compensation Committee of Board of Directors reviewed the various forms of outstanding equity awards, including restricted stock and restrict stock units, and approved that unvested restricted stock awards will be considered participating securities. Restricted stock units (“RSUs”) awarded to the Company’s named executive officers in 2018 and 2019, the vesting of which depends on the Company’s relative total shareholder return (“rTSR”) as compared to the KBW Nasdaq Regional Banking Index (“KRX”) over a three-year performance period, are not participating securities. If the Company’s KRX ranking for rTSR is below the 25th percentile (the “threshold level”) at the end of the relevant three-year performance period, no RSUs granted to such named executive officer(s) in 2018 or 2019, as the case may be, will vest and they will be forfeited in their entirety. If the Company’s KRX rating for rTSR reaches the 25th, 50th, 75th or 90th percentiles at the end of the relevant three-year performance period, 50%, 100%, 150% or 200%, respectively, of the RSUs granted to named executive officers in 2018 or 2019, as the case may be, will vest on the third anniversary of the relevant grant date, unless earlier forfeited. As a result of the different treatment of unvested restricted stock and unvested RSUs, beginning in 2019, earnings per common share is computed using the two-class method. Under the two-class method, distributed and undistributed earnings allocable to participating securities are deducted from net income to determine net income allocable to common shareholders, which is then used in the numerator of both basic and diluted earnings per share calculations. Basic earnings per common share are computed by dividing net income allocable to common shareholders by the weighted average number of common shares outstanding for the reporting period, excluding outstanding participating securities. Diluted earnings per common share are computed by dividing net income allocable to common shareholders by the weighted average number of common shares outstanding over the reporting period, adjusted to include the effect of potentially dilutive common shares, but excludes awards considered participating securities. The computation of diluted earnings per common share excludes the impact of the assumed exercise or issuance of securities that would have an anti-dilutive effect. The following tables set forth the Company’s earnings per share calculations for the periods indicated:
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Fair Value of Financial Instruments |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value of Financial Instruments | Fair Value of Financial Instruments The fair value of an asset or liability is the exchange price that would be received to sell that asset or paid to transfer that liability (exit price) in an orderly transaction occurring in the principal market (or most advantageous market in the absence of a principal market) for such asset or liability. In estimating fair value, the Company utilizes valuation techniques that are consistent with the market approach, the income approach, and/or the cost approach. Such valuation techniques are consistently applied. Inputs to valuation techniques include the assumptions that market participants would use in pricing an asset or liability. ASC Topic 825 requires disclosure of the fair value of financial assets and financial liabilities, including both those financial assets and financial liabilities that are not measured and reported at fair value on a recurring basis and a non-recurring basis. The methodologies for estimating the fair value of financial assets and financial liabilities that are measured at fair value are discussed below. In accordance with accounting guidance, the Company groups its financial assets and financial liabilities measured at fair value in three levels, based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described as follows: Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. Level 2 - 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 instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (such as interest rates, prepayment speeds, volatilities, etc.) or model-based valuation techniques where all significant assumptions are observable, either directly or indirectly, in the market. Level 3 - Valuation is generated from model-based techniques where one or more significant inputs are not observable, either directly or indirectly, in the market. These unobservable assumptions reflect the Company’s own estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques may include use of matrix pricing, discounted cash flow models, and similar techniques. Because no market exists for a significant portion of the Company’s financial instruments, fair value estimates are based on judgments regarding current economic conditions, risk characteristics of various financial instruments, and other factors. These estimates are subjective in nature, and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the fair values presented. Management uses its best judgment in estimating the fair value of the Company’s financial instruments; however, there are inherent limitations in any estimation technique. A financial instrument’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. Management maximizes the use of observable inputs and attempts to minimize the use of unobservable inputs when determining fair value measurements. Estimated fair values are disclosed for financial instruments for which it is practicable to estimate fair value. These estimates are made at a specific point in time based on relevant market data and information about the financial instruments. These estimates do not reflect any premium or discount that could result from offering the Company’s entire holdings of a particular financial instrument for sale at one time, nor do they attempt to estimate the value of anticipated future business related to the instruments. In addition, the tax ramifications related to the realization of unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in any of these estimates. Assets and Liabilities Measured at Fair Value on a Recurring Basis The following is a description of both the general and specific valuation methodologies used to measure financial assets and liabilities on a recurring basis, as well as the general classification of these instruments pursuant to the fair value hierarchy. Investment securities – Investment securities are generally valued based upon quotes obtained from independent third-party pricing services, which uses evaluated pricing applications and model processes. Observable market inputs, such as, benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data are considered as part of the evaluation. The inputs are related directly to the security being evaluated, or indirectly to a similarly situated security. Market assumptions and market data are utilized in the valuation models. The Company reviews the market prices provided by the third-party pricing service for reasonableness based on the Company’s understanding of the market place and credit issues related to the securities. The Company has not made any adjustments to the market quotes provided by them and, accordingly, the Company categorized its investment portfolio within Level 2 of the fair value hierarchy. Derivative assets and liabilities - The Company originates a variable rate loan and enters into a variable-to-fixed interest rate swap with the customer. The Company also enters into an offsetting swap with a correspondent bank. These back-to-back agreements are intended to offset each other and allow the Company to originate a variable rate loan, while providing a contract for fixed interest payments for the customer. The net cash flow for the Company is equal to the interest income received from a variable rate loan originated with the customer. The fair value of these derivatives is based on a market standard discounted cash flow approach. Due to the observable nature of the inputs used in deriving the fair value of these derivative contracts, the valuation of interest rate swaps is classified as Level 2. The following fair value hierarchy table presents information about the Company’s financial assets and liabilities measured at fair value on a recurring basis at the dates indicated:
Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis Impaired Loans and Other Real Estate Owned – A loan is considered impaired when it is probable that payment of interest and principal will not be made in accordance with the contractual terms of the loan agreement. Impairment is measured based on the fair value of the underlying collateral or the discounted expected future cash flows. The Company measures impairment on all nonaccrual loans for which it has reduced the principal balance to the value of the underlying collateral less the anticipated selling cost. OREO are recorded at estimated fair value less the costs to sell at the time of foreclosure or at the lower of cost or estimated fair value less the costs to sell subsequent to acquisition. As such, the Company records impaired loans and OREO as Level 3. At March 31, 2019 and December 31, 2018, substantially all the Company’s impaired loans were evaluated based on the fair value of their underlying collateral based upon the most recent appraisal available to management. The Company has recorded a specific reserve in the amount of $3.2 million on 10 loans with a recorded balance of $8.7 million. The fair value of impaired loans and other real estate owned were determined using Level 3 assumptions, and represents impaired loan and other real estate owned balances for which a specific reserve has been established or on which a write down has been taken. Generally, the Company obtains third party appraisals (or property valuations) and/or collateral audits in conjunction with internal analysis based on historical experience on its impaired loans and other real estate owned to determine fair value. In determining the net realizable value of the underlying collateral for impaired loans, the Company will then discount the valuation to cover both market price fluctuations and selling costs the Company expected would be incurred in the event of foreclosure. In addition to the discounts taken, the Company’s calculation of net realizable value considered any other senior liens in place on the underlying collateral. Fair Values of Financial Instruments The fair value estimates presented herein are based on pertinent information available to management as of the dates indicated, representing an exit price.
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Derivative Instruments |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments | Derivative Instruments From time to time, the Company enters into interest rate swap agreements with certain borrowers to assist them in mitigating their interest rate risk exposure associated with the loans they have with the Company. At the same time, the Company enters into identical interest rate swap agreements with another financial institution to mitigate the Company’s interest rate risk exposure associated with the swap agreements it enters into with its borrowers. The Company had swaps with matched terms with an aggregate notional amount of $57.0 million and a fair value of $1.1 million at March 31, 2019 compared with an aggregate notional amount of $57.5 million and a fair value of $1.7 million at December 31, 2018. The fair value of these agreements are determined through a third party valuation model used by the Company’s counterparty bank, which uses observable market data such as cash LIBOR rates, prices of Eurodollar future contracts and market swap rates. The fair values of these swaps are recorded as components of other assets and other liabilities in the Company’s condensed consolidated balance sheet. Changes in the fair value of these swaps, which occur due to changes in interest rates, are recorded in the Company’s income statement as a component of noninterest income. Since the terms of the swap agreements between the Company and its borrowers have been matched with the terms of swap agreements with another financial institution, the adjustments for the change in their fair value offset each other in non-interest income. Although changes in the fair value of swap agreements between the Company and borrowers and the Company and other financial institutions offset each other, changes in the credit risk of these counterparties may result in a difference in the fair value of these swap agreements. Offsetting swap agreements the Company has with other financial institutions are collateralized with cash, and swap agreements with borrowers are secured by the collateral arrangements for the underlying loans these borrowers have with the Company. During the three months ended March 31, 2019 and March 31, 2018, there were no losses recorded on swap agreements attributable to the change in credit risk associated with a counterparty. All interest rate swap agreements entered into by the Company as of March 31, 2019 and December 31, 2018 are not designated as hedging instruments. The following tables summarize the Company's derivative instruments, included in “other assets” and “other liabilities” in the consolidated statements of financial condition:
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Balance Sheet Offsetting |
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Offsetting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance Sheet Offsetting | Balance Sheet Offsetting Derivative financial instruments may be eligible for offset in the consolidated balance sheets, such as those subject to enforceable master netting arrangements or a similar agreement. Under these agreements, the Company has the right to net settle multiple contracts with the same counterparty. The Company offers an interest rate swap product to qualified customers, which are then paired with derivative contracts the Company enters into with a counterparty bank. While derivative contracts entered into with counterparty banks may be subject to enforceable master netting agreements, derivative contracts with customers may not be subject to enforceable master netting arrangements. Financial instruments that are eligible for offset in the consolidated statements of financial condition as of March 31, 2019 are presented in the table below:
Financial instruments that are eligible for offset in the consolidated statements of financial condition as of December 31, 2018 are presented in the table below:
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Leases |
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Leases [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases | Leases The Company accounts for its leases in accordance with ASC 842, which was implemented on January 1, 2019 and requires the Company to record liabilities for future lease obligations as well as assets representing the right to use the underlying leased asset. The Company’s leases primarily represent future obligations to make payments for the use of buildings or space for its operations. Liabilities to make future lease payments are recorded in Accrued expenses and other liabilities, while right-of-use assets are recorded in Other assets in the Company’s consolidated balance sheets. At March 31, 2019, all of the Company’s leases were classified as either operating leases or short-term leases. Liabilities to make future lease payments and right of use assets are recorded for operating leases and not short-term leases. These liabilities and right-of-use assets are determined based on the total contractual base rents for each lease, which include options to extend or renew each lease, where applicable, and where the Company believes it has an economic incentive to extend or renew the lease. Future contractual base rents are discounted using the rate implicit in the lease or using the Company’s estimated incremental borrowing rate if the rate implicit in the lease is not readily determinable. For leases that contain variable lease payments, the Company assumes future lease payment escalations based on a lease payment escalation rate specified in the lease or the specified index rate observed at the time of lease commencement. Liabilities to make future lease payments are accounted for using the interest method, being reduced by periodic contractual lease payments net of periodic interest accretion. Right-of-use assets for operating leases are amortized over the term of the associated lease by amounts that represent the difference between periodic straight-line lease expense and periodic interest accretion in the related liability to make future lease payments. For the three months ended March 31, 2019 expense associated with the Company’s leases totaled $3.4 million and was recorded in premises and occupancy expense in the consolidated statements of income. Of this amount, approximately $2.7 million is attributed to operating leases, while $691,000 is attributed to short-term leases, which are leases that have a term of 12 months or less at commencement. The following table presents supplemental information related to operating leases as of the period indicated:
The following table provides information related to minimum contractual lease payments and other information associated with the Company’s leases as of March 31, 2019:
The Company from time to time leases portions of space it owns to other parties. Income received from these transactions is recorded on a straight-line basis over the term of the sublease. For the three months ended March 31, 2019 and 2018, income from these transactions was not significant. The following table provides information related to minimum contractual lease payments for the periods indicated below as of December 31, 2018 (1):
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Revenue Recognition |
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue Recognition | Revenue Recognition The Company earns revenue from a variety of sources. The Company’s principal source of revenue is interest income on loans, investment securities and other interest earning assets, while the remainder of the Company’s revenue is earned from a variety of fees, service charges, gains and losses, and other income, all of which are classified as noninterest income. Revenue from interest on loans and investment securities is accounted for on an accrual basis using the interest method, while revenue from other sources is accounted for under other applicable U.S. GAAP as well as ASC 606 - Revenue from Contracts with Customers. Revenue streams within the scope of and accounted for under ASC 606 include: service charges and fees on deposit accounts, debit card interchange fees, fees from other services the Company provides its customers and gains and losses from the sale of other real estate owned and property, premises and equipment. ASC 606 requires revenue to be recognized when the Company satisfies the related performance obligations by transferring to the customer a good or service. The recognition of revenue under ASC 606 requires the Company to first identify the contract with the customer, identify the associated performance obligations, determine the transaction price, allocate the transaction price to the performance obligations and finally recognize revenue when the performance obligations have been satisfied and the good or service has been transferred. The majority of the Company’s contracts with customers associated with revenue streams that are within the scope of ASC 606 are considered short-term in nature, can be canceled at any time by the customer or the Company without penalty, such as a deposit account agreement, and are satisfied at a point in time. These revenue streams are included in non-interest income. The following tables provide a summary of the Company’s revenue streams, including those that are within the scope of ASC 606 and those that are accounted for under other applicable U.S. GAAP:
The following provides information concerning the major components of the Company’s revenue: Interest Income Interest income is comprised of interest on loans, investment securities and other interest-earning assets. Interest is recognized using the interest method, which reflects the contractual yield on loans and coupon yield for investment securities. These yields are adjusted for purchase discounts, premiums and net deferred loan origination fees/costs for newly originated loans. Loan Servicing Fees Loan servicing fees generally consist of fees related to servicing of loans for others, as well as the net impact of related serving asset amortization. ASC 606 stipulates that income streams generated through the transfer and servicing of financial instruments shall be accounted for under ASC 860 - Transfers and Servicing and is therefore excluded from the scope of ASC 606. Service Charges on Deposit Accounts and Other Service Fee Income Service charges on deposit accounts and other service fee income consists of periodic service charges on deposit accounts and transaction based fees such as those related to overdrafts, ATM charges and wire transfer fees. The majority of these revenues are accounted for under ASC 606. Performance obligations for periodic service charges on deposit accounts are typically short-term in nature and are generally satisfied on a monthly basis, while performance obligations for other transaction based fees are typically satisfied at a point in time (which may consist of only a few moments to perform the service or transaction) with no further obligations on behalf of the Company to the customer. Periodic service charges are generally collected monthly directly from the customer's deposit account, and at the end of a statement cycle, while transaction based service charges are typically collected at the time of or soon after the service is performed. Debit Card Interchange Income Debit card interchange fee income consists of transaction processing fees associated with customer debit card transactions processed through a payment network and are accounted for under ASC 606. These fees are earned each time a request for payment is originated by a customer debit cardholder at a merchant. In these transactions, the Company transfers funds from the debit cardholder’s account to a merchant through a payment network at the request of the debit cardholder by way of the debit card transaction. The related performance obligations are generally satisfied when the transfer of funds is complete, which is generally a point in time when the debit card transaction is processed. Debit card interchange fees are typically received and recorded as revenue on a daily basis. Earnings on Bank-Owned Life Insurance Earnings on bank-owned life insurance relates to the periodic increase in the cash surrender value of bank-owned life insurance policies on certain key employees of the Company for which the Company is the owner and beneficiary of the related policies. This revenue stream is excluded from the scope of ASC 606, and is accounted for under other applicable U.S. GAAP provisions (ASC 325-30). Gains and (Losses) from Sales of Loans and Investment Securities ASC 606 stipulates that gains and (losses) from the periodic sale of loans and investment securities are excluded from ASC 606 and are accounted for under other applicable U.S. GAAP provisions. Other Income Other income generally consists of recoveries on acquired loans, which were fully charged off and had no book value prior to their acquisition. This revenue stream is excluded from the scope of ASC 606 and is accounted for under other applicable U.S. GAAP provisions. Other income also consists of other miscellaneous fees, which are accounted for under ASC 606; however, much like service charges on deposit accounts, these fees have performance obligations that are very short-term in nature and are typically satisfied at a point in time. Revenue is typically recorded at the time these fees are collected, which is generally upon the completion the related transaction or service provided. Other revenue streams that may be applicable to the Company include gains and losses from the sale of non-financial assets such as other real estate owned and property premises and equipment. The Company accounts for these revenue streams in accordance with ASC 610-20, which requires the Company to look to guidance in ASC 606 in the application of certain measurement and recognition concepts. The Company records gains and losses on the sale of non-financial assets when control of the asset has been surrendered to the buyer, which generally occurs at a specific point in time. Practical Expedient The Company also employs a practical expedient with respect to contract acquisition costs, which are generally capitalized and amortized into expense. These costs relate to expenses incurred directly attributable to the efforts to obtain a contract. The practical expedient allows the Company to immediately recognize contract acquisition costs in current period earnings when these costs would have been amortized over a period of one year or less. |
Subsequent Events |
3 Months Ended |
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Mar. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Quarterly Cash Dividend On April 19, 2019, the Corporation’s Board of Directors declared a cash dividend of $0.22 per share, payable on May 15, 2019 to shareholders of record on May 1, 2019. Stock Repurchase In April 2019, the Corporation repurchased a total of 92,959 shares at an average price of $29.42 per share with a total cost of $2.7 million. Issuance of Subordinated Notes On May 8, 2019, the Corporation issued and sold to the public $125 million aggregate principal amount of its 4.875% Fixed-to-Floating Rate Subordinated Notes due May 15, 2029 (the “Notes”), at a public offering price equal to 100% of the aggregate principal amount of the Notes (the “Offering”). The Corporation estimates that the net proceeds from the Offering, after deducting underwriting discounts and estimated expenses, will be approximately $122.4 million. The Notes were offered pursuant to a prospectus supplement, dated May 3, 2019, to the prospectus dated April 23, 2019 that forms part of the Company’s effective registration statement on Form S-3 (File No. 333-230993) filed by the Corporation with the U.S. Securities and Exchange Commission under the Securities Act of 1933, as amended.
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Significant Accounting Policies (Policies) |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Recently Issued Accounting Pronouncements | Accounting Standards Adopted in 2019 In March 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU” or “Update”) 2017-08, Receivables-Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchase Callable Debt Securities. This Update amends guidance on the amortization period of premiums on certain purchased callable debt securities. The amendments shorten the amortization period of premiums on purchased callable debt securities to the earliest call date. This Update should be applied on a modified retrospective basis through a cumulative-effect adjustment to beginning retained earnings. The effective date of ASU 2017-08 is for interim and annual reporting periods beginning after December 15, 2018. The adoption of this standard did not have a material effect on the Company’s operating results or financial condition. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), ASU 2018-11, Leases (Topic 842): Targeted Improvements, ASU 2018-10, Codification Improvements to Topic 842, Leases. This Update is being issued to increase the transparency and comparability around lease obligations. Previously unrecorded off-balance sheet obligations and corresponding rights to use underlying leased assets will now be recorded in the consolidated financial statements, accompanied by enhanced qualitative and quantitative disclosures in the notes to the consolidated financial statements. The Update is generally effective for public business entities in fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. In July 2018, the FASB issued ASU 2018-10, Codification Improvements to Topic 842, Leases and ASU 2018-11, Leases (Topic 842): Targeted Improvements. ASU 2018-10 provides improvements related to ASU 2016-02 to increase stakeholders’ awareness of the amendments to Topic 842 and to expedite the improvements. The amendments affect narrow aspects of the guidance issued in ASU 2016-02. ASU 2018-11 allows entities adopting ASU 2016-02 to choose an additional transition method, under which an entity initially applies the accounting guidance for leases under Topic 842 at the adoption date and recognizes a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. Additionally, ASU 2018-11 allows an entity electing this additional transition method to continue to present comparative period financial statements in accordance with Topic 840 (current U.S. GAAP). ASU 2018-11 also allows lessors to not separate non-lease components from the associated lease component if certain conditions are met. The amendments in these updates became effective for annual periods as well as interim periods within those annual periods beginning after December 15, 2018. The Company elected to apply the transition provisions of Topic 842 using the alternative transition method whereby comparative periods are not restated. The Company also elected to adopt the “package” of practical expedients in its transition to Topic 842, as specified in ASC 842-10-65. The results of this policy election are that the Company reflected the provisions of Topic 842 in its consolidated financial statements for the first time as of and for the period ended March 31, 2019 (the period of adoption). The Company measured and recorded liabilities to make lease payments as well as right-of-use assets in the period of adoption for leases that existed as of the transition date, and will continue to present all comparative periods under Topic 840. Under this elected transition method, the Company is not required to reassess the following as part of its transition to Topic 842: (1) whether any expired or existing contracts contain leases, (2) lease classifications for any existing or expired leases and (3) initial direct costs for any existing leases. Additionally, the Company elected to apply the use of hindsight in its assessment of the term for its leases upon transition, which allows for consideration of the Company’s option to extend or terminate a lease. The Company adopted the provisions of Topic 842 on January 1, 2019, and in its transition Topic 842, the Company initially recorded a liability to make future lease payments of approximately $45.7 million and right-of-use assets of approximately $43.8 million. The difference of $1.9 million is the accounting adjustments previously recorded under Topic 840 and Topic 805, as required by transition guidance in ASC 842-10-65. The Company was not required to record a cumulative effect adjustment to the opening balance of retained earnings as part of its transition to Topic 842. The Company’s evaluation of lease obligations and service agreements under the new standard included an assessment of the appropriate classification and related accounting of each lease agreement, a review of applicability of the new standard to existing service agreements and gathering all essential lease data to facilitate the application of the new standard. The Company’s review indicated that all of its leases are classified as operating leases or short-term leases. In accordance with the provisions of Topic 842, liabilities to make future lease payments and right-of-use assets are only recorded for leases that are not considered short-term (leases with an original term of greater than 12 months). The Company records expense for its leases on a straight-line basis in accordance with the requirements under Topic 842 for operating leases. The Company’s expense recognition for its operating leases (including short-term leases) under Topic 842 has not differed significantly from that recorded under Topic 840. Right-of-use assets for operating leases are amortized over the lease term and liabilities to make future lease payments are accounted for using the interest method, both in accordance with Topic 842. Please also refer to Note 13 - Leases for additional information related to the Company’s leases. Recent Accounting Guidance Not Yet Effective In March 2019, the FASB issued ASU 2019-01, Leases (Topic 842): Codification Improvements. This Update provides clarification on certain aspects of an entity’s implementation of Topic 842 including those that relate to: (1) Determining the fair value of the underlying asset by lessors that are not manufacturers or dealers. The amendments related to this item carry forward from Topic 840 to Topic 842 an exception that allows lessors who are not manufacturers or dealers to use the cost of the underlying asset as its fair value. (2) Presentation on the statement of cash flows - sales-type and direct financing leases. The amendments related to this item clarify that all principal payments received on leases by lessors in sales-type or direct financing lease transactions should be reflected in investing activities for entities such as depository and lending institutions within in the scope of Topic 942. (3) Transition disclosures related to Topic 250, Accounting Changes and Error Corrections. The amendments related to this item clarify the FASB’s original intent by explicitly providing an exception to the paragraph 250-10-50-3 interim disclosure requirements in the Topic 842 transition disclosure requirements, which would otherwise require interim disclosures after the date of adoption of Topic 842 related to the impacts of the change on: (a) income from continuing operations, (b) net income, (c) any other financial statement line item and (d) any affected per-share amounts. The amendments in this Update are effective for public business entities for fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020. Early adoption is permitted. The Company does not believe the effects of this ASU will have a material effect on the Company’s financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement. The amendments in this Update modify the disclosure requirements on fair value measurements in Topic 820, Fair Value Measurement. The following disclosure requirements for public companies were removed from Topic 820:
The following disclosure requirements for public companies were modified in Topic 820:
The following disclosure requirements for public companies were added to Topic 820:
The amendments in this Update are effective for public business entities for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. Early adoption is permitted. In addition, an entity may early adopt any of the removed or modified disclosures immediately and delay adoption of the new disclosures until the effective date. The Company is currently evaluating the effects of ASU 2018-13 on its financial statements and disclosures. |
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Revenue Recognition | Revenue Recognition – The Company accounts for certain of its revenue streams in accordance with ASC 606 - Revenue from Contracts with Customers. Revenue streams within the scope of and accounted for under ASC 606 include: service charges and fees on deposit accounts, debit card interchange fees, fees from other services the Bank provides its customers and gains and losses from the sale of other real estate owned and property, premises and equipment. ASC 606 requires revenue to be recognized when the Company satisfies related performance obligations by transferring to the customer a good or service. The recognition of revenue under ASC 606 requires the Company to first identify the contract with the customer, identify the performance obligations, determine the transaction price, allocate the transaction price to the performance obligations and finally recognize revenue when the performance obligations have been satisfied and the good or service has been transferred. The majority of the Company’s contracts with customers associated with revenue streams that are within the scope of ASC 606 are considered short-term in nature and can be canceled at any time by the customer or the Bank, such as a deposit account agreement. Other more significant revenue streams for the Company such as interest income on loans and investment securities are specifically excluded from the scope of ASC 606 and are accounted for under other applicable U.S. GAAP. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Core Deposit Intangible | Goodwill and Core Deposit Intangible – Goodwill is generally determined as the excess of the fair value of the consideration transferred, plus the fair value of any noncontrolling interests in the acquiree, over the fair value of the net assets acquired and liabilities assumed as of the acquisition date. Goodwill and intangible assets acquired in a purchase business combination and determined to have an indefinite useful life are not amortized, but tested for impairment at least annually or more frequently if events and circumstances exist that indicate the necessity for such impairment tests to be performed. The Company has selected the fourth quarter as the period to perform the annual impairment test. Intangible assets with definite useful lives are amortized over their estimated useful lives to their estimated residual values. Goodwill is the only intangible asset with an indefinite life on our balance sheet. |
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Use of Estimates | Use of Estimates – The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements. Actual results could differ from those estimates. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurement | The fair value of an asset or liability is the exchange price that would be received to sell that asset or paid to transfer that liability (exit price) in an orderly transaction occurring in the principal market (or most advantageous market in the absence of a principal market) for such asset or liability. In estimating fair value, the Company utilizes valuation techniques that are consistent with the market approach, the income approach, and/or the cost approach. Such valuation techniques are consistently applied. Inputs to valuation techniques include the assumptions that market participants would use in pricing an asset or liability. ASC Topic 825 requires disclosure of the fair value of financial assets and financial liabilities, including both those financial assets and financial liabilities that are not measured and reported at fair value on a recurring basis and a non-recurring basis. The methodologies for estimating the fair value of financial assets and financial liabilities that are measured at fair value are discussed below. In accordance with accounting guidance, the Company groups its financial assets and financial liabilities measured at fair value in three levels, based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described as follows: Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. Level 2 - 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 instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (such as interest rates, prepayment speeds, volatilities, etc.) or model-based valuation techniques where all significant assumptions are observable, either directly or indirectly, in the market. Level 3 - Valuation is generated from model-based techniques where one or more significant inputs are not observable, either directly or indirectly, in the market. These unobservable assumptions reflect the Company’s own estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques may include use of matrix pricing, discounted cash flow models, and similar techniques. Because no market exists for a significant portion of the Company’s financial instruments, fair value estimates are based on judgments regarding current economic conditions, risk characteristics of various financial instruments, and other factors. These estimates are subjective in nature, and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the fair values presented. Management uses its best judgment in estimating the fair value of the Company’s financial instruments; however, there are inherent limitations in any estimation technique. A financial instrument’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. Management maximizes the use of observable inputs and attempts to minimize the use of unobservable inputs when determining fair value measurements. Estimated fair values are disclosed for financial instruments for which it is practicable to estimate fair value. These estimates are made at a specific point in time based on relevant market data and information about the financial instruments. These estimates do not reflect any premium or discount that could result from offering the Company’s entire holdings of a particular financial instrument for sale at one time, nor do they attempt to estimate the value of anticipated future business related to the instruments. In addition, the tax ramifications related to the realization of unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in any of these estimates. Assets and Liabilities Measured at Fair Value on a Recurring Basis The following is a description of both the general and specific valuation methodologies used to measure financial assets and liabilities on a recurring basis, as well as the general classification of these instruments pursuant to the fair value hierarchy. Investment securities – Investment securities are generally valued based upon quotes obtained from independent third-party pricing services, which uses evaluated pricing applications and model processes. Observable market inputs, such as, benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data are considered as part of the evaluation. The inputs are related directly to the security being evaluated, or indirectly to a similarly situated security. Market assumptions and market data are utilized in the valuation models. The Company reviews the market prices provided by the third-party pricing service for reasonableness based on the Company’s understanding of the market place and credit issues related to the securities. The Company has not made any adjustments to the market quotes provided by them and, accordingly, the Company categorized its investment portfolio within Level 2 of the fair value hierarchy. Derivative assets and liabilities - The Company originates a variable rate loan and enters into a variable-to-fixed interest rate swap with the customer. The Company also enters into an offsetting swap with a correspondent bank. These back-to-back agreements are intended to offset each other and allow the Company to originate a variable rate loan, while providing a contract for fixed interest payments for the customer. The net cash flow for the Company is equal to the interest income received from a variable rate loan originated with the customer. The fair value of these derivatives is based on a market standard discounted cash flow approach. Due to the observable nature of the inputs used in deriving the fair value of these derivative contracts, the valuation of interest rate swaps is classified as Level 2. The following fair value hierarchy table presents information about the Company’s financial assets and liabilities measured at fair value on a recurring basis at the dates indicated:
Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis Impaired Loans and Other Real Estate Owned – A loan is considered impaired when it is probable that payment of interest and principal will not be made in accordance with the contractual terms of the loan agreement. Impairment is measured based on the fair value of the underlying collateral or the discounted expected future cash flows. The Company measures impairment on all nonaccrual loans for which it has reduced the principal balance to the value of the underlying collateral less the anticipated selling cost. OREO are recorded at estimated fair value less the costs to sell at the time of foreclosure or at the lower of cost or estimated fair value less the costs to sell subsequent to acquisition. As such, the Company records impaired loans and OREO as Level 3. At March 31, 2019 and December 31, 2018, substantially all the Company’s impaired loans were evaluated based on the fair value of their underlying collateral based upon the most recent appraisal available to management. The Company has recorded a specific reserve in the amount of $3.2 million on 10 loans with a recorded balance of $8.7 million. |
Acquisitions (Tables) |
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Schedule of assets acquired and liabilities assumed and the provisional fair value adjustments and amounts recorded | The following table represents the assets acquired and liabilities assumed of Grandpoint as of July 1, 2018 and the fair value adjustments and amounts recorded by the Company in 2018 under the acquisition method of accounting:
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Schedule of contractual amounts due, expected cash flows to be collected, interest component and fair value as of the respective acquisition dates | For loans acquired from Grandpoint, the contractual amounts due, expected cash flows to be collected, interest component and fair value as of acquisition date was as follows:
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Summary of pro forma net interest and other income, net income and earnings per share | There were no material, nonrecurring adjustments to the pro forma net interest and other income, net income and earnings per share presented below:
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Investment Securities (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of amortized cost and estimated fair value of securities | The amortized cost and estimated fair value of securities were as follows:
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Schedule of number, fair value and gross unrealized holding losses of the Company's investment securities by investment category and length of time that the securities have been in a continuous loss position | The table below shows the number, fair value and gross unrealized holding losses of the Company’s investment securities by investment category and length of time that the securities have been in a continuous loss position.
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Schedule of amortized cost and estimated fair value of investment securities available for sale by contractual maturity | The amortized cost and estimated fair value of investment securities at March 31, 2019, by contractual maturity are shown in the table below.
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Loans Held for Investment (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of components of loans held for investment | The following table sets forth the composition of our loan portfolio in dollar amounts at the dates indicated:
______________________________ (1) Secured by real estate. (2) Includes second trust deeds. (3) Total gross loans held for investment for March 31, 2019 and December 31, 2018 are net of the unaccreted fair value net purchase discounts of $57.2 million and $61.0 million, respectively.
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Summary of loan portfolio by the Company's internal risk grading system | The following tables stratify the loan portfolio by the Company’s internal risk grading as of the periods indicated:
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Schedule of delinquencies in the Company's loan portfolio | The following tables set forth delinquencies in the Company’s loan portfolio at the dates indicated:
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Summary of Company's investment in impaired loans | The following tables provide a summary of the Company’s investment in impaired loans as of the period indicated:
The following table presents information on impaired loans and leases, disaggregated by class, for the periods indicated:
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Summary of additional detail on components of impaired loans | The following table provides additional detail on the components of impaired loans at the period end indicated:
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Summary of Company's investment in purchased credit impaired loans | The Company has purchased loans that have experienced deterioration of credit quality between origination and acquisition and for which it was probable, at acquisition, that not all contractually required payments would be collected. The carrying amount of those loans is as follows:
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Summary of accretable yield on purchased credit impaired | The following table summarizes the accretable yield on the purchased credit impaired loans for the three month periods indicated.
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Allowance for Loan Losses (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Provision for Loan and Lease Losses [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of allocation of the allowance as well as the activity in the allowance attributed to various segments in the loan portfolio | The following tables summarize the allocation of the ALLL, as well as the activity in the ALLL attributed to various segments in the loan portfolio as of and for the three months ended for the periods indicated:
|
Earnings Per Share (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Company's unaudited earnings per share calculations | The following tables set forth the Company’s earnings per share calculations for the periods indicated:
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Fair Value of Financial Instruments (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of carrying amount and estimated fair value of financial instruments | The fair value estimates presented herein are based on pertinent information available to management as of the dates indicated, representing an exit price.
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Schedule of Company's financial instruments measured at fair value on a recurring basis | The following fair value hierarchy table presents information about the Company’s financial assets and liabilities measured at fair value on a recurring basis at the dates indicated:
|
Derivative Instruments (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Derivative Instruments | The following tables summarize the Company's derivative instruments, included in “other assets” and “other liabilities” in the consolidated statements of financial condition:
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Balance Sheet Offsetting (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Offsetting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Offsetting Assets and Liabilities | Financial instruments that are eligible for offset in the consolidated statements of financial condition as of March 31, 2019 are presented in the table below:
Financial instruments that are eligible for offset in the consolidated statements of financial condition as of December 31, 2018 are presented in the table below:
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Leases (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Supplemental Information | The following table presents supplemental information related to operating leases as of the period indicated:
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Schedule of Minimum Contractual Lease Payments and Other Information | The following table provides information related to minimum contractual lease payments and other information associated with the Company’s leases as of March 31, 2019:
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Schedule of Information Related to Minimum Contractual Lease Payments | The following table provides information related to minimum contractual lease payments for the periods indicated below as of December 31, 2018 (1):
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Revenue Recognition (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Company's Revenue Streams | The following tables provide a summary of the Company’s revenue streams, including those that are within the scope of ASC 606 and those that are accounted for under other applicable U.S. GAAP:
|
Recently Issued Accounting Pronouncements (Details) - USD ($) $ in Thousands |
Mar. 31, 2019 |
Jan. 01, 2019 |
---|---|---|
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating lease liabilities | $ 43,892 | |
Operating lease right of use assets | $ 41,800 | |
Accounting Standards Update 2016-02 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating lease liabilities | $ 45,700 | |
Operating lease right of use assets | 43,800 | |
Cumulative adjustment not recorded | $ 1,900 |
Significant Accounting Policies (Details) - Core Deposits |
3 Months Ended |
---|---|
Mar. 31, 2019 | |
Minimum | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Weighted average useful life (in years) | 6 years |
Maximum | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Weighted average useful life (in years) | 10 years |
Acquisitions - Narrative (Details) $ / shares in Units, $ in Thousands |
Jul. 01, 2018
USD ($)
$ / shares
shares
|
Mar. 31, 2019
USD ($)
|
Dec. 31, 2018
USD ($)
|
---|---|---|---|
Business Acquisition [Line Items] | |||
Goodwill | $ 808,726 | $ 808,726 | |
Grandpoint Capital, Inc. | |||
Business Acquisition [Line Items] | |||
Total assets acquired | $ 3,051,567 | 3,075,820 | |
Gross loans acquired | 2,400,000 | ||
Total deposits acquired | $ 2,506,663 | 2,506,929 | |
Equity issued, ratio | 0.4750 | ||
Consideration paid | $ 602,152 | ||
Aggregate cash consideration payable | $ 28,100 | ||
Company's common stock value (usd per share) | $ / shares | $ 38.15 | ||
Goodwill | $ 313,000 | $ 313,043 | |
Grandpoint Capital, Inc. | Common Stock | |||
Business Acquisition [Line Items] | |||
Common stock issued as consideration (in shares) | shares | 15,758,089 |
Acquisitions - Loan Information (Details) - Acquired Loans - Grandpoint Capital, Inc. $ in Thousands |
Jul. 01, 2018
USD ($)
|
---|---|
Business Acquisition [Line Items] | |
Contractual amounts due | $ 3,496,905 |
Cash flows not expected to be collected | 39,071 |
Expected cash flows | 3,457,834 |
Interest component of expected cash flows | 1,105,117 |
Fair value of acquired loans | $ 2,352,717 |
Acquisitions - Pro Forma Information (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2019 |
Dec. 31, 2018 |
Mar. 31, 2018 |
|
Business Combinations [Abstract] | |||
Net interest and other income | $ 117,561 | $ 122,258 | $ 116,618 |
Net income | $ 38,718 | $ 39,643 | $ 36,695 |
Basic earnings per share (in dollars per share) | $ 0.62 | $ 0.64 | $ 0.60 |
Diluted earnings per share (in dollars per share) | $ 0.62 | $ 0.63 | $ 0.59 |
Loans Held for Investment - Components of Impaired Loans (Details) - USD ($) $ in Thousands |
Mar. 31, 2019 |
Dec. 31, 2018 |
---|---|---|
Receivables [Abstract] | ||
Nonaccrual loans | $ 12,858 | $ 4,857 |
Accruing loans | 7,500 | 7,601 |
Total impaired loans | $ 20,358 | $ 12,458 |
Loans Held for Investment - Accretable Yield Roll Forward (Details) - USD ($) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2019 |
Dec. 31, 2018 |
Mar. 31, 2018 |
|
Accretable yield on purchased credit impaired | |||
Balance at the beginning of period | $ 411 | $ 1,988 | $ 3,019 |
Additions | 0 | 0 | 0 |
Accretion | (79) | (262) | (236) |
Payoffs | 0 | (47) | (1,850) |
Sales | 0 | (1,293) | 0 |
Reclassification from nonaccretable difference | 0 | 25 | 776 |
Balance at the end of period | $ 332 | $ 411 | $ 1,709 |
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2019 |
Dec. 31, 2018 |
Mar. 31, 2018 |
|
Basic | |||
Net income | $ 38,718 | $ 39,643 | $ 28,002 |
Less: Earnings allocated to participating securities | (347) | 0 | 0 |
Net income allocated to common stockholders | $ 38,371 | $ 39,643 | $ 28,002 |
Weighted average common shares outstanding (in shares) | 61,987,605 | 61,917,184 | 45,893,496 |
Basic earnings per share (in dollars per share) | $ 0.62 | $ 0.64 | $ 0.61 |
Diluted | |||
Net income allocated to common stockholders | $ 38,371 | $ 39,643 | $ 28,002 |
Weighted average common shares outstanding (in shares) | 61,987,605 | 61,917,184 | 45,893,496 |
Diluted effect of share-based compensation (in shares) | 298,178 | 539,916 | 758,563 |
Weighted average diluted common shares (in shares) | 62,285,783 | 62,457,100 | 46,652,059 |
Diluted earnings per share (in dollars per share) | $ 0.62 | $ 0.63 | $ 0.60 |
Fair Value of Financial Instruments - Narrative (Details) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2019
USD ($)
loan
|
Dec. 31, 2018
USD ($)
|
Mar. 31, 2018
USD ($)
|
|
Fair Value Disclosures [Abstract] | |||
Specific reserve recorded on loan | $ 3,212 | $ 584 | $ 0 |
Number of loans with a specific reserve | loan | 10 | ||
Principal balance of loan with specific reserve | $ 8,741 | $ 1,038 |
Derivative Instruments (Details) - USD ($) $ in Thousands |
Mar. 31, 2019 |
Dec. 31, 2018 |
---|---|---|
Derivative [Line Items] | ||
Derivative assets, fair value | $ 1,068 | $ 1,681 |
Derivative liabilities, fair value | 1,068 | 1,681 |
Not Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Notional | 57,023 | 57,502 |
Derivative assets, fair value | 1,068 | 1,681 |
Derivative liabilities, fair value | 1,068 | 1,681 |
Not Designated as Hedging Instrument | Interest rate swap contracts | ||
Derivative [Line Items] | ||
Notional | 57,023 | 57,502 |
Derivative assets, fair value | 1,068 | 1,681 |
Derivative liabilities, fair value | $ 1,068 | $ 1,681 |
Leases - Narrative (Details) $ in Thousands |
3 Months Ended |
---|---|
Mar. 31, 2019
USD ($)
| |
Leases [Abstract] | |
Expense associated with the Company's leases | $ 3,400 |
Operating lease expense | 2,700 |
Short-term lease expense | $ 691 |
Leases - Schedule of Supplemental Information (Details) $ in Thousands |
3 Months Ended |
---|---|
Mar. 31, 2019
USD ($)
| |
Leases [Abstract] | |
Operating lease right of use assets | $ 41,800 |
Operating lease liabilities | 43,892 |
Operating cash flows from operating leases | $ 2,545 |
Leases - Schedule of Minimum Contractual Lease Payments and Other Information (Details) $ in Thousands |
Mar. 31, 2019
USD ($)
|
---|---|
Operating leases | |
2019 | $ 10,004 |
2020 | 8,550 |
2021 | 8,865 |
2022 | 8,511 |
2023 | 7,021 |
Thereafter | 9,689 |
Total | 52,640 |
Short-term leases | |
2019 | 958 |
2020 | 0 |
2021 | 0 |
2022 | 0 |
2023 | 0 |
Thereafter | 0 |
Total | 958 |
Total contractual base rents | |
2019 | 10,962 |
2020 | 8,550 |
2021 | 8,865 |
2022 | 8,511 |
2023 | 7,021 |
Thereafter | 9,689 |
Total | 53,598 |
Total liability to make lease payments | 43,892 |
Difference in undiscounted and discounted future lease payments | $ 9,706 |
Weighted average discount rate | 6.34% |
Weighted average remaining lease term (years) | 5 years 7 months 6 days |
Leases - Schedule of Information Related to Minimum Contractual Lease Payments (Details) $ in Thousands |
Dec. 31, 2018
USD ($)
|
---|---|
Leases [Abstract] | |
2019 | $ 11,468 |
2020 | 10,869 |
2021 | 10,133 |
2022 | 9,296 |
2023 | 8,124 |
Thereafter | 10,518 |
Total | $ 60,408 |
Subsequent Events (Details) - USD ($) |
1 Months Ended | 3 Months Ended | ||
---|---|---|---|---|
May 08, 2019 |
Apr. 19, 2019 |
Apr. 30, 2019 |
Mar. 31, 2019 |
|
Subsequent Event [Line Items] | ||||
Cash dividends declared (in dollars per share) | $ 0.22 | |||
Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Cash dividends declared (in dollars per share) | $ 0.22 | |||
Total shares repurchased (in shares) | 92,959 | |||
Average price (usd per share) | $ 29.42 | |||
Total cost of repurchased shares | $ 2,700,000 | |||
Subsequent Event | Subordinated Notes, 4.875%, Due May 15, 2029 | Subordinated Debentures | ||||
Subsequent Event [Line Items] | ||||
Debt issued | $ 125,000,000 | |||
Fixed interest rate (as a percent) | 4.875% | |||
Percentage of aggregate principal amount | 100.00% | |||
Proceeds from offering | $ 122,400,000 |
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