10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2017

OR

◻TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-35654

NATIONAL BANK HOLDINGS CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	27-0563799
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

7800 East Orchard, Suite 300, Greenwood Village, Colorado 80111

(Address of principal executive offices) (Zip Code)

Registrant’s telephone, including area code: (720) 529-3336

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ◻

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  ☒    No  ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

Large accelerated filer	☒	Accelerated filer	◻
Non-accelerated filer	◻  (do not check if a smaller reporting company)	Smaller reporting company	◻
		Emerging growth company	◻

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ◻    No  ☒

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

As of August 3, 2017, the registrant had outstanding 26,791,575 shares of Class A voting common stock, each with $0.01 par value per share, excluding 251,741 shares of restricted Class A common stock issued but not yet vested.



		Page
Part I. Financial Information
Item 1.	Financial Statements (Unaudited)	3
	Consolidated Statements of Financial Condition as of June 30, 2017 and December 31, 2016	3
	Consolidated Statements of Operations for the Three and Six months ended June 30, 2017 and 2016	4
	Consolidated Statements of Comprehensive Income for the Three and Six months ended June 30, 2017 and 2016	5
	Consolidated Statements of Changes in Shareholders’ Equity for the Six months ended June 30, 2017 and 2016	6
	Consolidated Statements of Cash Flows for the Six months ended June 30, 2017 and 2016	7
	Notes to Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	37
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	66
Item 4.	Controls and Procedures	66
Part II. Other Information
Item 1.	Legal Proceedings	67
Item 1A.	Risk Factors	67
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	67
Item 5.	Other Information	67
Item 6.	Exhibits	67

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, notwithstanding that such statements are not specifically identified. Any statements about our expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. These statements are often, but not always, made through the use of words or phrases such as “anticipate,” “believe,” “can,” “would,” “should,” “could,” “may,” “predict,” “seek,” “potential,” “will,” “estimate,” “target,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “intend” and similar words or phrases. These statements are only predictions and involve estimates, known and unknown risks, assumptions and uncertainties. We have based these statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, liquidity, results of operations, business strategy and growth prospects.

Forward-looking statements involve certain important risks, uncertainties and other factors, any of which could cause actual results to differ materially from those in such statements and, therefore, you are cautioned not to place undue reliance on such statements. Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to:

       our ability to execute our business strategy, as well as changes in our business strategy or development plans;

       business and economic conditions generally and in the financial services industry;

       economic, market, operational, liquidity, credit and interest rate risks associated with our business;

       effects of any changes in trade, monetary and fiscal policies and laws, including the interest rate policies of the Federal Reserve Board;

       changes imposed by regulatory agencies to increase our capital to a level greater than the current level required for well-capitalized financial institutions;

       effects of inflation, as well as, interest rate, securities market and monetary supply fluctuations;

       changes in the economy or supply-demand imbalances affecting local real estate values;

       changes in consumer spending, borrowings and savings habits;

       our ability to identify potential candidates for, obtain regulatory approval for, and consummate, acquisitions of financial institutions on attractive terms, or at all;

       our ability to integrate acquisitions or consolidations and to achieve synergies, operating efficiencies and/or other expected benefits within expected time-frames, or at all, or within expected cost projections, and to preserve the goodwill of acquired financial institutions;

       our ability to realize the anticipated benefits from enhancements or updates to our core operating systems from time to time without significant change in our client service or risk to our control environment; 

       dependence on information technology and telecommunications systems of third party service providers and the risk of system failures, interruptions or breaches of security, including those that could result in disclosure or misuse of confidential or proprietary client or other information;

       our ability to achieve organic loan and deposit growth and the composition of such growth;

       changes in sources and uses of funds, including loans, deposits and borrowings;

       increased competition in the financial services industry, nationally, regionally or locally, resulting in, among other things, lower returns;

1

       the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Public Company Accounting Oversight Board, the Financial Accounting Standards Board and other accounting standard setters;

       the trading price of shares of the Company's stock;

       our ability to realize deferred tax assets or the need for a valuation allowance, or the effects of changes in tax laws on our deferred tax assets;

       continued consolidation in the financial services industry;

       our ability to maintain or increase market share and control expenses;

       costs and effects of changes in laws and regulations and of other legal and regulatory developments, including, but not limited to, changes in regulation that affect the fees that we charge, the resolution of legal proceedings or regulatory or other governmental inquiries, and the results of regulatory examinations, reviews or other inquiries; and changes in regulations that apply to us due to the conversion of our bank subsidiary to a Colorado state-chartered bank;

       technological changes;

       the timely development and acceptance of new products and services and perceived overall value of these products and services by our clients;

       changes in our management personnel and our continued ability to hire and retain qualified personnel;

       ability to implement and/or improve operational management and other internal risk controls and processes and our reporting system and procedures;

       regulatory limitations on dividends from our bank subsidiary;

       changes in estimates of future loan reserve requirements based upon the periodic review thereof under relevant regulatory and accounting requirements;

       widespread natural and other disasters, dislocations, political instability, acts of war or terrorist activities, cyberattacks or international hostilities through impacts on the economy and financial markets generally or on us or our counterparties specifically;

       impact of reputational risk on such matters as business generation and retention;

       other risks and uncertainties listed from time to time in the Company’s reports and documents filed with the Securities and Exchange Commission; and

       our success at managing the risks involved in the foregoing items.

Any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events or circumstances, except as required by applicable law.

2

PART I: FINANCIAL INFORMATION

Item 1: FINANCIAL STATEMENTS

NATIONAL BANK HOLDINGS CORPORATION AND SUBSIDIARIES

Consolidated Statements of Financial Condition (Unaudited)

(In thousands, except share and per share data)

	June 30, 2017		December 31, 2016
ASSETS
Cash and cash equivalents	$	129,827	$	152,736
Investment securities available-for-sale (at fair value)		866,714		884,232
Investment securities held-to-maturity (fair value of $294,869 and $332,573 at June 30, 2017 and December 31, 2016, respectively)		294,891		332,505
Non-marketable securities		18,468		14,949
Loans		3,087,945		2,860,921
Allowance for loan losses		(34,959)		(29,174)
Loans, net		3,052,986		2,831,747
Loans held for sale		7,067		24,187
Other real estate owned		14,297		15,662
Premises and equipment, net		92,321		95,671
Goodwill		59,630		59,630
Intangible assets, net		4,210		6,949
Other assets		152,358		154,778
Total assets	$	4,692,769	$	4,573,046
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities:
Deposits:
Non-interest bearing demand deposits	$	870,875	$	846,744
Interest bearing demand deposits		418,729		427,538
Savings and money market		1,441,372		1,422,321
Time deposits		1,126,481		1,172,046
Total deposits		3,857,457		3,868,649
Securities sold under agreements to repurchase		119,213		92,011
Federal Home Loan Bank advances		129,115		38,665
Other liabilities		42,497		37,532
Total liabilities		4,148,282		4,036,857
Shareholders’ equity:
Common stock, par value $0.01 per share: 400,000,000 shares authorized; 51,587,424 and 51,813,011 shares issued; 26,788,833 and 26,386,583 shares outstanding at June 30, 2017 and December 31, 2016, respectively		515		514
Additional paid-in capital		971,145		984,087
Retained earnings		68,570		55,454
Treasury stock of 24,542,527 and 24,927,157 shares at June 30, 2017 and December 31, 2016, respectively, at cost		(494,547)		(502,104)
Accumulated other comprehensive loss, net of tax		(1,196)		(1,762)
Total shareholders’ equity		544,487		536,189
Total liabilities and shareholders’ equity	$	4,692,769	$	4,573,046

See accompanying notes to the consolidated interim financial statements.

3

NATIONAL BANK HOLDINGS CORPORATION AND SUBSIDIARIES

Consolidated Statements of Operations (Unaudited)

(In thousands, except share and per share data)

	For the three months ended				For the six months ended
	June 30,				June 30,
	2017		2016		2017		2016
Interest and dividend income:
Interest and fees on loans	$	34,411	$	30,071	$	66,174	$	63,027
Interest and dividends on investment securities		6,489		7,759		13,102		15,994
Dividends on non-marketable securities		218		193		385		421
Interest on interest-bearing bank deposits		214		449		411		584
Total interest and dividend income		41,332		38,472		80,072		80,026
Interest expense:
Interest on deposits		3,904		3,516		7,691		6,826
Interest on borrowings		536		203		767		409
Total interest expense		4,440		3,719		8,458		7,235
Net interest income before provision for loan losses		36,892		34,753		71,614		72,791
Provision for loan losses		4,025		6,457		5,820		17,076
Net interest income after provision for loan losses		32,867		28,296		65,794		55,715
Non-interest income:
Service charges		3,546		3,465		6,872		6,725
Bank card fees		3,134		2,935		5,938		5,702
Gain on sale of mortgages, net		594		958		1,048		1,432
Bank-owned life insurance income		472		486		942		881
Other non-interest income		4,124		2,473		5,538		3,164
OREO related income		86		187		314		523
Total non-interest income		11,956		10,504		20,652		18,427
Non-interest expense:
Salaries and benefits		19,909		19,612		40,299		40,224
Occupancy and equipment		5,242		5,708		10,679		11,774
Telecommunications and data processing		1,552		1,471		3,139		3,112
Marketing and business development		545		689		1,196		1,115
FDIC deposit insurance		686		1,064		1,391		1,985
Bank card expenses		896		963		1,779		1,876
Professional fees		1,270		978		1,686		1,434
Other non-interest expense		2,733		2,112		5,139		4,067
Problem asset workout		880		958		1,752		1,932
Gain on OREO sales, net		(1,644)		(1,611)		(1,756)		(2,043)
Intangible asset amortization		1,370		1,370		2,740		2,740
Total non-interest expense		33,439		33,314		68,044		68,216
Income before income taxes		11,384		5,486		18,402		5,926
Income tax expense		2,175		982		935		1,171
Net income	$	9,209	$	4,504	$	17,467	$	4,755
Income per share—basic	$	0.34	$	0.15	$	0.65	$	0.16
Income per share—diluted	$	0.33	$	0.15	$	0.63	$	0.16
Weighted average number of common shares outstanding:
Basic		26,955,187		29,215,822		26,878,904		29,666,570
Diluted		27,597,443		29,278,759		27,637,532		29,707,379

See accompanying notes to the consolidated interim financial statements.

4

NATIONAL BANK HOLDINGS CORPORATION AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income (Unaudited)

(In thousands)

	For the three months ended				For the six months ended
	June 30,				June 30,
	2017		2016		2017		2016
Net income	$	9,209	$	4,504	$	17,467	$	4,755
Other comprehensive income, net of tax:
Securities available-for-sale:
Net unrealized gains arising during the period, net of tax expense of $(631) and $(1,976) for the three months ended June 30, 2017 and 2016, respectively; and net of tax expense of $(792) and $(7,487) for the six months ended June 30, 2017 and 2016, respectively		1,014		3,221		1,276		12,198
Less: amortization of net unrealized holding gains to income, net of tax benefit of $217 and $304 for the three months ended June 30, 2017 and 2016, respectively; and net of tax benefit of $435 and $623 for the six months ended June 30, 2017 and 2016, respectively		(353)		(495)		(710)		(1,015)
Other comprehensive income		661		2,726		566		11,183
Comprehensive income	$	9,870	$	7,230	$	18,033	$	15,938

See accompanying notes to the consolidated interim financial statements.

5

NATIONAL BANK HOLDINGS CORPORATION AND SUBSIDIARIES

Consolidated Statements of Changes in Shareholders’ Equity (Unaudited)

Six months ended June 30, 2017 and 2016

(In thousands, except share and per share data)

									Accumulated
			Additional						other
	Common		paid-in		Retained		Treasury		comprehensive
	stock		capital		earnings		stock		income (loss), net		Total
Balance, December 31, 2015	$	513	$	997,926	$	38,670	$	(419,660)	$	95	$	617,544
Net income		—		—		4,755		—		—		4,755
Stock-based compensation		—		1,791		—		—		—		1,791
Issuance of stock under equity compensation plans, including tax benefit of $39, loss on reissuance of treasury stock of $50, net		1		(2,862)		—		2,422		—		(439)
Repurchase of 1,671,923 shares		—		—		—		(32,918)		—		(32,918)
Cash dividends declared ($0.10 per share)		—		—		(3,006)		—		—		(3,006)
Other comprehensive income		—		—		—		—		11,183		11,183
Balance, June 30, 2016	$	514	$	996,855	$	40,419	$	(450,156)	$	11,278	$	598,910
Balance, December 31, 2016	$	514	$	984,087	$	55,454	$	(502,104)	$	(1,762)	$	536,189
Net income		—		—		17,467		—		—		17,467
Stock-based compensation		—		1,869		—		—		—		1,869
Issuance of stock under purchase and equity compensation plans, including gain on reissuance of treasury stock of $5,004, net		1		(12,878)		—		5,624		—		(7,253)
Cash dividends declared ($0.16 per share)		—		—		(4,351)		—		—		(4,351)
Warrant exercise		—		(1,933)		—		1,933		—		—
Other comprehensive income		—		—		—		—		566		566
Balance, June 30, 2017	$	515	$	971,145	$	68,570	$	(494,547)	$	(1,196)	$	544,487

See accompanying notes to the consolidated interim financial statements.

6

NATIONAL BANK HOLDINGS CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows (Unaudited)

(In thousands)

	For the six months ended
	June 30,
	2017		2016
Cash flows from operating activities:
Net income	$	17,467	$	4,755
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan losses		5,820		17,076
Depreciation and amortization		6,630		7,394
Current income tax receivable		1,622		6,395
Deferred income tax (asset) liability		(369)		3,710
Net excess tax (benefit) deficit on stock-based compensation		(3,393)		52
Discount accretion, net of premium amortization on securities		1,324		1,534
Loan accretion		(12,728)		(18,924)
Gain on sale of mortgages, net		(1,048)		(1,432)
Origination of loans held for sale, net of repayments		(39,279)		(44,593)
Proceeds from sales of loans held for sale		53,719		47,020
Bank-owned life insurance income		(942)		(881)
Gain on the sale of other real estate owned, net		(1,756)		(2,043)
Impairment on other real estate owned		46		104
Loss (gain) on sale of fixed assets		40		(1,839)
Gain from banking center divestitures		(2,886)		—
Stock-based compensation		1,869		1,791
Decrease (increase) in other assets		1,947		(6,210)
Increase in other liabilities		6,547		12,639
Net cash provided by operating activities		34,630		26,548
Cash flows from investing activities:
Purchase of FHLB stock		(7,204)		(500)
Proceeds from redemption of FHLB stock		3,685		5,761
Proceeds from redemption of FRB stock		—		4,964
Proceeds from maturities of investment securities held-to-maturity		36,216		44,442
Proceeds from maturities of investment securities available-for-sale		115,268		134,464
Purchase of investment securities available-for-sale		(96,948)		(4,872)
Net increase in loans		(243,118)		(146,274)
(Purchases) sale of premises and equipment, net		(581)		1,718
Purchase of bank-owned life insurance		—		(10,344)
Proceeds from sales of loans		33,813		9,231
Proceeds from sales of other real estate owned		3,714		3,165
Net cash (used in) provided by investing activities		(155,155)		41,755
Cash flows from financing activities:
Net decrease in deposits		(8,308)		(39,732)
Increase (decrease) in repurchase agreements		27,202		(10,377)
Advances from FHLB		253,129		—
FHLB payoffs		(162,679)		—
Issuance of stock under purchase and equity compensation plans		(7,253)		(485)
Payment of dividends		(4,475)		(2,944)
Repurchase of shares		—		(32,918)
Net cash provided by (used in) financing activities		97,616		(86,456)
Decrease in cash and cash equivalents		(22,909)		(18,153)
Cash and cash equivalents at beginning of the year		152,736		166,092
Cash and cash equivalents at end of period	$	129,827	$	147,939
Supplemental disclosure of cash flow information during the period:
Cash paid for interest	$	8,333	$	7,084
Net tax payments (refunds)	$	33	$	( 2,117)
Supplemental schedule of non-cash investing activities:
Loans transferred to other real estate owned at fair value	$	639	$	3,654
Loans purchased but not settled	$	1,937	$	667
Loans transferred from loans held for sale to loans	$	3,729	$	—

See accompanying notes to the consolidated interim financial statements.

7

NATIONAL BANK HOLDINGS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

June 30, 2017

Note 1 Basis of Presentation

National Bank Holdings Corporation ("NBHC" or the "Company") is a bank holding company that was incorporated in the State of Delaware in June 2009 with the intent to acquire and operate financial services franchises and other complementary businesses in targeted markets. The Company is headquartered immediately south of Denver, in Greenwood Village, Colorado, and its primary operations are conducted through its wholly owned subsidiary, NBH Bank, referred to as the Bank, or NBH Bank, a Colorado state-chartered bank and a member of the Federal Reserve System. The Company provides a variety of banking products to both commercial and consumer clients through a network of 86 banking centers located in Colorado, the greater Kansas City area and Texas, and through online and mobile banking products.

The accompanying interim unaudited consolidated financial statements serve to update the National Bank Holdings Corporation Annual Report on Form 10-K for the year ended December 31, 2016 and include the accounts of the Company and its wholly owned subsidiary, NBH Bank. The accompanying unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and where applicable, with general practices in the banking industry or guidelines prescribed by bank regulatory agencies. However, they may not include all information and notes necessary to constitute a complete set of financial statements under GAAP applicable to annual periods and accordingly should be read in conjunction with the financial information contained in the Company's most recent Form 10-K. The unaudited consolidated financial statements reflect all adjustments which are, in the opinion of management, necessary for a fair statement of the results presented. All such adjustments are of a normal recurring nature. All significant intercompany balances and transactions have been eliminated in consolidation. Certain reclassifications of prior years' amounts are made whenever necessary to conform to current period presentation. The results of operations for the interim period is not necessarily indicative of the results that may be expected for the full year or any other interim period. All amounts are in thousands, except share data, or as otherwise noted.

GAAP requires management to make estimates that affect the reported amounts of assets, liabilities, revenues and expenses, and disclosures of contingent assets and liabilities. By their nature, estimates are based on judgment and available information. Management has made significant estimates in certain areas, such as the amount and timing of expected cash flows from assets, the valuation of other real estate owned (“OREO”), the fair value adjustments on assets acquired and liabilities assumed, the valuation of core deposit intangible assets, the valuation of investment securities for other-than-temporary impairment (“OTTI”), the valuation of stock-based compensation, the fair values of financial instruments, the allowance for loan losses (“ALL”), and contingent liabilities. Because of the inherent uncertainties associated with any estimation process and future changes in market and economic conditions, it is possible that actual results could differ significantly from those estimates.

The Company's significant accounting policies followed in the preparation of the unaudited consolidated financial statements are disclosed in note 2 of the audited financial statements and notes for the year ended December 31, 2016 and are contained in the Company's Annual Report on Form 10-K. There have not been any significant changes to the application of significant accounting policies since December 31, 2016.

Note 2 Recent Accounting Pronouncements

Revenue from Contracts with Customers—In May 2014, the FASB issued ASU 2014-09, "Revenue from Contracts with Customers."  This update supersedes revenue recognition requirements in ASC Topic 605, Revenue Recognition, including most industry-specific revenue recognition guidance in the FASB Accounting Standards Codification. The new guidance stipulates that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance provides specific steps that entities should apply in order to achieve this principle. The amendments are effective for interim and annual periods beginning after December 15, 2017, with early application permitted for interim and annual periods beginning after December 15, 2016. ASU No. 2014-09 allows for either full retrospective or modified retrospective adoption. The Company is in the process of evaluating the impact of the ASU's adoption on the Company's consolidated financial statements, if any. The Company will adopt ASU 2014-09 in the first quarter of 2018 and expects to apply the modified retrospective approach.

The new guidance does not apply to revenue associated with financial instruments, including loans and securities that are accounted for under other GAAP; therefore, the Company does not expect the new guidance to have a material impact on revenue most closely

8

associated with financial instruments, including interest income and expense. The Company is continuing its overall assessment of revenue streams and reviewing contracts potentially affected by the ASU, most notably deposit service charges and bank card fees to determine the potential impact the new guidance is expected to have on the Company’s consolidated financial statements. In addition, the Company continues to follow certain implementation issues relevant to the banking industry which are still pending resolution. The Company will adopt ASU No. 2014-09 on January 1, 2018 and expects to utilize the modified retrospective approach.

Leases—In February 2016, the FASB issued ASU 2016-02, Leases. The guidance in ASU 2016-02 supersedes the lease recognition requirements in ASC Topic 840, Leases. The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statements. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. Early adoption of the amendments in the update is permitted. The Company will adopt ASU 2016-02 in the first quarter of 2019 and is currently in the process of evaluating the impact of the ASU's adoption on the Company's consolidated financial statements.

Financial Instruments - Credit Losses—In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments. This update replaces the current incurred loss methodology for recognizing credit losses with a current expected credit loss model, which requires the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. This amendment broadens the information that an entity must consider in developing its expected credit loss estimates. Additionally, the update amends the accounting for credit losses for available-for-sale debt securities and purchased financial assets with a more-than-insignificant amount of credit deterioration since origination. This update requires enhanced disclosures to help investors and other financial statement users better understand significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of a company’s loan portfolio. The amendments in this update are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption in fiscal years beginning after December 15, 2018 is permitted. The amendment requires the use of the modified retrospective approach for adoption. The Company is in the process of evaluating the impact of the ASU’s adoption on the Company’s consolidated financial statements.

The Company reviewed ASU 2016-01, Financial Instruments – Recognition and Measurement of Financial Assets and Financial Liabilities (Topic 825), ASU 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments, ASU 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment and ASU 2017-05, Other Income – Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20) and does not expect the adoption of these pronouncements to have a material impact on its financial statements.

Note 3 Investment Securities

The Company’s investment securities portfolio is comprised of available-for-sale and held-to-maturity investment securities. These investment securities totaled $1.2 billion at June 30, 2017 and included $0.9 billion of available-for-sale securities and $0.3 billion of held-to-maturity securities. At December 31, 2016, investment securities totaled $1.2 billion and included $0.9 billion of available-for-sale securities and $0.3 billion of held-to-maturity securities.

9

Available-for-sale

At June 30, 2017 and December 31, 2016, the Company held $0.9 billion of available-for-sale investment securities. Available-for-sale securities are summarized as follows as of the dates indicated:

	June 30, 2017
	Amortized		Gross		Gross
	cost		unrealized gains		unrealized losses		Fair value
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	192,369	$	3,476	$	(504)	$	195,341
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		680,040		1,604		(13,013)		668,631
Municipal securities		2,323		—		—		2,323
Other securities		419		—		—		419
Total	$	875,151	$	5,080	$	(13,517)	$	866,714

	December 31, 2016
	Amortized		Gross		Gross
	cost		unrealized gains		unrealized losses		Fair value
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	223,781	$	3,909	$	(530)	$	227,160
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		666,616		2,124		(16,001)		652,739
Municipal securities		3,921		—		(7)		3,914
Other securities		419		—		—		419
Total	$	894,737	$	6,033	$	(16,538)	$	884,232

At June 30, 2017 and December 31, 2016, mortgage-backed securities represented primarily all of the Company’s available-for-sale investment portfolio and all mortgage-backed securities were backed by government sponsored enterprises (“GSE”) collateral such as Federal Home Loan Mortgage Corporation (“FHLMC”) and Federal National Mortgage Association (“FNMA”), and the government sponsored agency Government National Mortgage Association (“GNMA”).

The table below summarizes the available-for-sale securities with unrealized losses as of the dates shown, along with the length of the impairment period:

	June 30, 2017
	Less than 12 months				12 months or more				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	value		losses		value		losses		value		losses
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	79,548	$	(504)	$	—	$	—	$	79,548	$	(504)
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		148,819		(2,279)		354,843		(10,734)		503,662		(13,013)
Total	$	228,367	$	(2,783)	$	354,843	$	(10,734)	$	583,210	$	(13,517)

10

	December 31, 2016
	Less than 12 months				12 months or more				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	value		losses		value		losses		value		losses
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	100,898	$	(530)	$	—	$	—	$	100,898	$	(530)
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		137,576		(2,976)		385,707		(13,025)		523,283		(16,001)
Municipal securities		3,058		(7)		—		—		3,058		(7)
Total	$	241,532	$	(3,513)	$	385,707	$	(13,025)	$	627,239	$	(16,538)

The unrealized losses in the Company's investment portfolio at June 30, 2017 were caused by changes in interest rates. The portfolio included 63 securities, having an aggregate fair value of $583.2 million, which were in an unrealized loss position at June 30, 2017. During the six months ended June 30, 2017, the Company recorded $0.2 million of other-than-temporary impairment (OTTI) included in other non-interest expense on the consolidated statement of operations. The OTTI credit charge was on a single municipal security, with an aggregate fair value of $1.5 million.

The unrealized losses in the Company's investment portfolio at December 31, 2016 were caused by changes in interest rates. The portfolio included 61 securities, having an aggregate fair value of $627.2 million, which were in an unrealized loss position at December 31, 2016. Management evaluated all of the available-for-sale securities in an unrealized position and concluded no OTTI existed at December 31, 2016.

The Company has no intention to sell these securities before recovery of their amortized cost and believes it will not be required to sell the securities before the recovery of their amortized cost.

Certain securities are pledged as collateral for public deposits, securities sold under agreements to repurchase, and to secure borrowing capacity at the Federal Reserve Bank and Federal Home Loan Bank (“FHLB”), if needed. The fair value of available-for-sale investment securities pledged as collateral totaled $296.4 million at June 30, 2017 and $373.7 million at December 31, 2016. Certain investment securities may also be pledged as collateral for the line of credit at the FHLB of Topeka; at June 30, 2017 and December 31, 2016, no securities were pledged for this purpose.

Mortgage-backed securities do not have a single maturity date and actual maturities may differ from contractual maturities depending on the repayment characteristics and experience of the underlying financial instruments. The estimated weighted average life of the available-for-sale mortgage-backed securities portfolio was 3.1 years at June 30, 2017 and 3.4 years at December 31, 2016. This estimate is based on assumptions and actual results may differ. At June 30, 2017 and December 31, 2016, the duration of the total available-for-sale investment portfolio was 2.9 years and 3.2 years, respectively.

As of June 30, 2017, municipal securities with an amortized cost and fair value of $1.5 million were due in one year, municipal securities with an amortized cost and fair value of $0.3 million were due after one year through five years, and municipal securities with an amortized cost and fair value of $0.6 million were due after five years through ten years. Other securities of $0.4 million as of June 30, 2017, have no stated contractual maturity date.

11

Held-to-maturity

At June 30, 2017 and December 31, 2016, the Company held $294.9 million and $332.5 million of held-to-maturity investment securities, respectively. Held-to-maturity investment securities are summarized as follows as of the dates indicated:

	June 30, 2017
			Gross		Gross
	Amortized		unrealized		unrealized
	cost		gains		losses		Fair value
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	233,026	$	1,332	$	(164)	$	234,194
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		61,865		11		(1,201)		60,675
Total investment securities held-to-maturity	$	294,891	$	1,343	$	(1,365)	$	294,869

	December 31, 2016
			Gross		Gross
	Amortized		unrealized		unrealized
	cost		gains		losses		Fair value
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	263,411	$	1,685	$	(234)	$	264,862
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		69,094		16		(1,399)		67,711
Total investment securities held-to-maturity	$	332,505	$	1,701	$	(1,633)	$	332,573

The table below summarizes the held-to-maturity securities with unrealized losses as of the dates shown, along with the length of the impairment period:

	June 30, 2017
	Less than 12 months				12 months or more				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	value		losses		value		losses		value		losses
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	25,512	$	(164)	$	—	$	—	$	25,512	$	(164)
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		23,861		(306)		29,244		(895)		53,105		(1,201)
Total	$	49,373	$	(470)	$	29,244	$	(895)	$	78,617	$	(1,365)

	December 31, 2016
	Less than 12 months				12 months or more				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	value		losses		value		losses		value		losses
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	27,799	$	(234)	$	—	$	—	$	27,799	$	(234)
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		26,992		(357)		32,146		(1,042)		59,138		(1,399)
Total	$	54,791	$	(591)	$	32,146	$	(1,042)	$	86,937	$	(1,633)

The held-to-maturity portfolio included 16 securities, having an aggregate fair value of $78.6 million, which were in an unrealized loss position at June 30, 2017, compared to 15 securities, with a fair value of $86.9 million, at December 31, 2016.

12

Management evaluated all of the held-to-maturity securities in an unrealized loss position and concluded that no OTTI existed at June 30, 2017 or December 31, 2016. The unrealized losses in the Company's investments issued or guaranteed by U.S. government agencies or sponsored enterprises at June 30, 2017 were caused by changes in interest rates. The Company has no intention to sell these securities before recovery of their amortized cost and believes it will not be required to sell the securities before the recovery of their amortized cost.

The carrying value of held-to-maturity investment securities pledged as collateral totaled $139.8 million and $119.2 million at June 30, 2017 and December 31, 2016, respectively. 

Actual maturities of mortgage-backed securities may differ from scheduled maturities depending on the repayment characteristics and experience of the underlying financial instruments. The estimated weighted average expected life of the held-to-maturity mortgage-backed securities portfolio as of June 30, 2017 and December 31, 2016 was 3.1 years and 3.5 years, respectively. This estimate is based on assumptions and actual results may differ. The duration of the total held-to-maturity investment portfolio was 2.9 years and 3.2 years as of June 30, 2017 and December 31, 2016, respectively.

Note 4 Loans

The loan portfolio is comprised of loans originated by the Company and loans that were acquired in connection with the Company’s acquisitions.

The table below shows the loan portfolio composition including carrying value by segment of loans accounted for under ASC Topic 310-30, Receivables—Loans and Debt Securities Acquired with Deteriorated Credit Quality, and loans not accounted for under this guidance, which includes the Company’s originated loans. The carrying value of loans is net of discounts on loans excluded from ASC 310-30, and fees and costs of $4.9 million and $6.3 million as of June 30, 2017 and December 31, 2016, respectively. At December 31, 2016, $14.4 million of non 310-30 loans were held-for-sale, most of which were in the residential real estate segment. The sale of these loans was completed in connection with the four banking center divestitures in the second quarter of 2017.

	June 30, 2017
	ASC 310-30 loans		Non 310-30 loans		Total loans		% of total
Commercial	$	35,978	$	1,739,476	$	1,775,454	57.5%
Commercial real estate non-owner occupied		83,785		473,235		557,020	18.0%
Residential real estate		14,012		714,499		728,511	23.6%
Consumer		652		26,308		26,960	0.9%
Total	$	134,427	$	2,953,518	$	3,087,945	100.0%

	December 31, 2016
	ASC 310-30 loans		Non 310-30 loans		Total loans		% of total
Commercial	$	39,280	$	1,521,150	$	1,560,430	54.6%
Commercial real estate non-owner occupied		89,150		437,642		526,792	18.4%
Residential real estate		16,524		728,361		744,885	26.0%
Consumer		898		27,916		28,814	1.0%
Total	$	145,852	$	2,715,069	$	2,860,921	100.0%

13

Delinquency for loans excluded from ASC 310-30 is shown in the following tables at June 30, 2017 and December 31, 2016, respectively:

	June 30, 2017
					Greater						Total		Loans > 90
	30-59		60-89		than 90						non		days past
	days  past		days past		days past		Total  past				310-30		due and		Non-
	due		due		due		due		Current		loans		still accruing		accrual
Loans excluded from ASC 310-30:
Commercial:
Commercial and industrial	$	658	$	228	$	4,135	$	5,021	$	1,270,834	$	1,275,855	$	—	$	7,780
Owner occupied commercial real estate		890		—		52		942		232,988		233,930		—		4,377
Agriculture		512		—		435		947		130,451		131,398		—		2,208
Energy		—		—		6,613		6,613		91,680		98,293		—		12,050
Total commercial		2,060		228		11,235		13,523		1,725,953		1,739,476		—		26,415
Commercial real estate non-owner occupied:
Construction		—		—		215		215		121,441		121,656		215		—
Acquisition/development		334		—		—		334		16,008		16,342		—		—
Multifamily		—		—		—		—		41,430		41,430		—		—
Non-owner occupied		135		—		—		135		293,672		293,807		—		35
Total commercial real estate		469		—		215		684		472,551		473,235		215		35
Residential real estate:
Senior lien		854		1,667		1,298		3,819		658,403		662,222		—		5,286
Junior lien		185		47		8		240		52,037		52,277		—		557
Total residential real estate		1,039		1,714		1,306		4,059		710,440		714,499		—		5,843
Consumer		69		19		6		94		26,214		26,308		—		162
Total loans excluded from ASC 310-30	$	3,637	$	1,961	$	12,762	$	18,360	$	2,935,158	$	2,953,518	$	215	$	32,455

	December 31, 2016
					Greater						Total		Loans > 90
	30-59		60-89		than 90						non		days past
	days past		days past		days past		Total  past				310-30		due and		Non-
	due		due		due		due		Current		loans		still accruing		accrual
Loans excluded from ASC 310-30:
Commercial:
Commercial and industrial	$	3,134	$	4,009	$	1,078	$	8,221	$	1,066,475	$	1,074,696	$	—	$	8,688
Owner occupied commercial real estate		583		216		56		855		220,689		221,544		—		2,056
Agriculture		501		—		—		501		134,136		134,637		—		1,905
Energy		2		—		6,548		6,550		83,723		90,273		—		12,645
Total commercial		4,220		4,225		7,682		16,127		1,505,023		1,521,150		—		25,294
Commercial real estate non-owner occupied:
Construction		—		—		—		—		90,314		90,314		—		—
Acquisition/development		—		—		—		—		13,306		13,306		—		—
Multifamily		—		—		—		—		24,954		24,954		—		—
Non-owner occupied		—		—		28		28		309,040		309,068		—		66
Total commercial real estate		—		—		28		28		437,614		437,642		—		66
Residential real estate:
Senior lien		888		645		1,458		2,991		672,699		675,690		—		4,522
Junior lien		115		61		22		198		52,473		52,671		—		654
Total residential real estate		1,003		706		1,480		3,189		725,172		728,361		—		5,176
Consumer		83		8		—		91		27,825		27,916		—		181
Total loans excluded from ASC 310-30	$	5,306	$	4,939	$	9,190	$	19,435	$	2,695,634	$	2,715,069	$	—	$	30,717

Loans are considered past due or delinquent when the contractual principal or interest due in accordance with the terms of the loan agreement remains unpaid after the due date of the scheduled payment. Pooled loans accounted for under ASC 310-30 that are 90 days or more past due and still accreting are generally considered to be performing and are included in loans 90 days or more past due and still accruing. Non-accrual loans include troubled debt restructurings on non-accrual status.

Non-accrual loans excluded from the scope of ASC 310-30 totaled $32.5 million at June 30, 2017, increasing $1.7 million, or 5.7% from December 31, 2016. The increase was driven primarily by one loan relationship totaling $2.2 million in the owner occupied commercial real estate sector placed on non-accrual during the second quarter of 2017, offset by other net decreases of $0.5 million.

14

Credit exposure for all loans as determined by the Company’s internal risk rating system was as follows as of June 30, 2017 and December 31, 2016, respectively:

	June 30, 2017
			Special
	Pass		mention		Substandard		Doubtful		Total
Loans excluded from ASC 310-30:
Commercial:
Commercial and industrial	$	1,243,638	$	13,978	$	15,472	$	2,767	$	1,275,855
Owner occupied commercial real estate		222,882		4,607		6,196		245		233,930
Agriculture		106,022		22,668		2,674		34		131,398
Energy		86,243		—		5,998		6,052		98,293
Total commercial		1,658,785		41,253		30,340		9,098		1,739,476
Commercial real estate non-owner occupied:
Construction		121,441		—		215		—		121,656
Acquisition/development		13,844		2,498		—		—		16,342
Multifamily		39,255		—		2,175		—		41,430
Non-owner occupied		291,007		1,566		1,234		—		293,807
Total commercial real estate		465,547		4,064		3,624		—		473,235
Residential real estate:
Senior lien		656,249		251		5,709		13		662,222
Junior lien		51,404		—		873		—		52,277
Total residential real estate		707,653		251		6,582		13		714,499
Consumer		26,086		56		166		—		26,308
Total loans excluded from ASC 310-30	$	2,858,071	$	45,624	$	40,712	$	9,111	$	2,953,518
Loans accounted for under ASC 310-30:
Commercial	$	27,799	$	1,105	$	7,074	$	—	$	35,978
Commercial real estate non-owner occupied		54,207		1,701		27,877		—		83,785
Residential real estate		11,234		1,088		1,690		—		14,012
Consumer		464		12		176		—		652
Total loans accounted for under ASC 310-30	$	93,704	$	3,906	$	36,817	$	—	$	134,427
Total loans	$	2,951,775	$	49,530	$	77,529	$	9,111	$	3,087,945

	December 31, 2016
			Special
	Pass		mention		Substandard		Doubtful		Total
Loans excluded from ASC 310-30:
Commercial:
Commercial and industrial	$	1,041,326	$	7,243	$	25,636	$	491	$	1,074,696
Owner occupied commercial real estate		202,036		9,371		10,137		—		221,544
Agriculture		123,809		8,922		1,906		—		134,637
Energy		77,619		—		7,811		4,843		90,273
Total commercial		1,444,790		25,536		45,490		5,334		1,521,150
Commercial real estate non-owner occupied:
Construction		90,099		—		215		—		90,314
Acquisition/development		10,758		2,548		—		—		13,306
Multifamily		22,495		238		2,221		—		24,954
Non-owner occupied		300,922		5,895		2,251		—		309,068
Total commercial real estate		424,274		8,681		4,687		—		437,642
Residential real estate:
Senior lien		669,148		1,215		5,316		11		675,690
Junior lien		51,250		178		1,243		—		52,671
Total residential real estate		720,398		1,393		6,559		11		728,361
Consumer		27,669		59		188		—		27,916
Total loans excluded from ASC 310-30	$	2,617,131	$	35,669	$	56,924	$	5,345	$	2,715,069
Loans accounted for under ASC 310-30:
Commercial	$	27,436	$	610	$	11,234	$	—	$	39,280
Commercial real estate non-owner occupied		38,895		967		45,520		3,768		89,150
Residential real estate		12,477		1,327		2,720		—		16,524
Consumer		721		17		160		—		898
Total loans accounted for under ASC 310-30	$	79,529	$	2,921	$	59,634	$	3,768	$	145,852
Total loans	$	2,696,660	$	38,590	$	116,558	$	9,113	$	2,860,921

Non 310-30 substandard loans within the commercial and industrial sector decreased from December 31, 2016, primarily due to two loan relationship upgrades totaling $6.2 million from substandard to special mention and one loan relationship downgrade totaling $2.1 million from substandard to doubtful during the six months ended June 30, 2017. Non 310-30 substandard loans within the owner occupied commercial real estate sector decreased from December 31, 2016, primarily due to two loan relationship upgrades totaling

15

$5.5 million from substandard to special mention, partially offset by one loan relationship placed on non-accrual and included in substandard during the second quarter of 2017 totaling $1.4 million. Non 310-30 doubtful loans within the energy sector increased from December 31, 2016, due to increased specific reserves on one relationship previously placed on non-accrual.

Impaired Loans

Loans are considered to be impaired when it is probable that the Company will not be able to collect all amounts due in accordance with the contractual terms of the loan agreement. Impaired loans are comprised of loans excluded from ASC 310-30 on non-accrual status, loans in bankruptcy, and troubled debt restructurings (“TDRs”) described below. If a specific allowance is warranted based on the borrower’s overall financial condition, the specific allowance is calculated based on discounted cash flows using the loan’s initial contractual effective interest rate or the fair value of the collateral less selling costs for collateral dependent loans. At June 30, 2017, the Company measured $29.0 million of impaired loans based on the fair value of the collateral less selling costs and $2.5 million of impaired loans using discounted cash flows and the loan’s initial contractual effective interest rate. Impaired loans totaling $7.9 million that individually were less than $250 thousand each, were measured through the general ALL reserves due to their relatively small size.

At June 30, 2017 and December 31, 2016, the Company’s recorded investments in impaired loans were $39.4 million and $38.3 million, respectively. Impaired loans at June 30, 2017 were primarily comprised of eight relationships totaling $24.6 million. Three of the relationships were in the energy sector, three of the relationships were in the commercial and industrial sector, one relationship was in the owner-occupied commercial real estate sector and one relationship was in the agricultural sector. Impaired loans had a collective related allowance for loan losses allocated to them of $6.2 million and $2.4 million at June 30, 2017 and December 31, 2016, respectively.

16

Additional information regarding impaired loans at June 30, 2017 and December 31, 2016 is set forth in the table below:

	June 30, 2017						December 31, 2016
					Allowance						Allowance
	Unpaid				for loan		Unpaid				for loan
	principal		Recorded		losses		principal		Recorded		losses
	balance		investment		allocated		balance		investment		allocated
With no related allowance recorded:
Commercial:
Commercial and industrial	$	6,712	$	5,387	$	—	$	8,671	$	7,495	$	—
Owner occupied commercial real estate		3,954		3,755		—		3,350		3,197		—
Agriculture		1,581		1,377		—		2,044		1,987		—
Energy		16,548		5,437		—		17,142		6,105		—
Total commercial		28,795		15,956		—		31,207		18,784		—
Commercial real estate non-owner occupied:
Construction		—		—		—		—		—		—
Acquisition/development		—		—		—		—		—		—
Multifamily		31		31		—		33		33		—
Non-owner occupied		357		306		—		394		343		—
Total commercial real estate		388		337		—		427		376		—
Residential real estate:
Senior lien		345		328		—		1,551		1,426		—
Junior lien		—		—		—		54		51		—
Total residential real estate		345		328		—		1,605		1,477		—
Consumer		—		—		—		4		4		—
Total impaired loans with no related allowance recorded	$	29,528	$	16,621	$	—	$	33,243	$	20,641	$	—
With a related allowance recorded:
Commercial:
Commercial and industrial	$	4,681	$	4,642	$	2,767	$	3,495	$	3,464	$	492
Owner occupied commercial real estate		2,585		2,336		248		957		642		2
Agriculture		938		911		35		—		—		—
Energy		6,613		6,613		3,148		11,216		6,548		1,866
Total commercial		14,817		14,502		6,198		15,668		10,654		2,360
Commercial real estate non-owner occupied:
Construction		—		—		—		—		—		—
Acquisition/development		—		—		—		—		—		—
Multifamily		—		—		—		—		—		—
Non-owner occupied		220		214		1		261		255		1
Total commercial real estate		220		214		1		261		255		1
Residential real estate:
Senior lien		7,162		6,486		36		5,646		5,016		31
Junior lien		1,634		1,391		10		1,781		1,532		14
Total residential real estate		8,796		7,877		46		7,427		6,548		45
Consumer		170		165		1		188		184		2
Total impaired loans with a related allowance recorded	$	24,003	$	22,758	$	6,246	$	23,544	$	17,641	$	2,408
Total impaired loans	$	53,531	$	39,379	$	6,246	$	56,787	$	38,282	$	2,408

17

The table below shows additional information regarding the average recorded investment and interest income recognized on impaired loans for the periods presented:

	For the three months ended
	June 30, 2017				June 30, 2016
	Average recorded investment		Interest income recognized		Average recorded investment		Interest income recognized
With no related allowance recorded:
Commercial:
Commercial and industrial	$	6,645	$	25	$	4,279	$	70
Owner occupied commercial real estate		3,789		23		1,825		20
Agriculture		1,454		—		1,758		—
Energy		5,680		—		—		—
Total commercial		17,568		48		7,862		90
Commercial real estate non-owner occupied:
Construction		—		—		—		—
Acquisition/development		—		—		—		—
Multifamily		—		—		—		—
Non-owner occupied		312		5		—		—
Total commercial real estate		312		5		—		—
Residential real estate:
Senior lien		330		—		1,296		8
Junior lien		—		—		134		—
Total residential real estate		330		—		1,430		8
Consumer		—		—		—		—
Total impaired loans with no related allowance recorded	$	18,210	$	53	$	9,292	$	98
With a related allowance recorded:
Commercial:
Commercial and industrial	$	4,643	$	—	$	4,144	$	—
Owner occupied commercial real estate		2,340		7		842		4
Agriculture		912		1		178		1
Energy		6,624		—		25,975		—
Total commercial		14,519		8		31,139		5
Commercial real estate non-owner occupied:
Construction		—		—		—		—
Acquisition/development		—		—		—		—
Multifamily		31		—		35		—
Non-owner occupied		216		2		814		10
Total commercial real estate		247		2		849		10
Residential real estate:
Senior lien		6,525		20		5,149		28
Junior lien		1,403		12		1,652		14
Total residential real estate		7,928		32		6,801		42
Consumer		169		—		241		—
Total impaired loans with a related allowance recorded	$	22,863	$	42	$	39,030	$	57
Total impaired loans	$	41,073	$	95	$	48,322	$	155

18

	For the six months ended
	June 30, 2017				June 30, 2016
	Average recorded investment		Interest income recognized		Average recorded investment		Interest income recognized
With no related allowance recorded:
Commercial:
Commercial and industrial	$	7,030	$	73	$	4,564	$	138
Owner occupied commercial real estate		3,834		41		1,869		49
Agriculture		1,531		—		1,758		—
Energy		5,889		—		—		—
Total Commercial		18,284		114		8,191		187
Commercial real estate non-owner occupied:
Construction		—		—		—		—
Acquisition/development		—		—		—		—
Multifamily		—		—		—		—
Non-owner occupied		320		12		—		—
Total commercial real estate		320		12		—		—
Residential real estate:
Senior lien		334		—		1,312		14
Junior lien		—		—		136		1
Total residential real estate		334		—		1,448		15
Consumer		—		—		—		—
Total impaired loans with no related allowance recorded	$	18,938	$	126	$	9,639	$	202
With a related allowance recorded:
Commercial:
Commercial and industrial	$	4,630	$	—	$	4,312	$	—
Owner occupied commercial real estate		2,349		11		865		7
Agriculture		914		3		179		3
Energy		6,602		—		26,005		—
Total Commercial		14,495		14		31,361		10
Commercial real estate non-owner occupied:
Construction		—		—		—		—
Acquisition/development		—		—		—		—
Multifamily		31		1		36		1
Non-owner occupied		220		5		823		24
Total commercial real estate		251		6		859		25
Residential real estate:
Senior lien		6,583		40		5,212		53
Junior lien		1,421		25		1,670		27
Total residential real estate		8,004		65		6,882		80
Consumer		175		—		242		—
Total impaired loans with a related allowance recorded	$	22,925	$	85	$	39,344	$	115
Total impaired loans	$	41,863	$	211	$	48,983	$	317

Interest income recognized on impaired loans noted in the table above primarily represents interest earned on accruing troubled debt restructurings. Interest income recognized on impaired loans during the three months ended June 30, 2017 and 2016 was $0.1 million and $0.2 million, respectively. Interest income recognized on impaired loans during the six months ended June 30, 2017 and 2016 was $0.2 million and $0.3 million, respectively.

19

Troubled debt restructurings

It is the Company’s policy to review each prospective credit in order to determine the appropriateness and the adequacy of security or collateral prior to making a loan. In the event of borrower default, the Company seeks recovery in compliance with lending laws, the respective loan agreements, and credit monitoring and remediation procedures that may include restructuring a loan to provide a concession by the Company to the borrower from their original terms due to borrower financial difficulties in order to facilitate repayment. Additionally, if a borrower’s repayment obligation has been discharged by a court, and that debt has not been reaffirmed by the borrower, regardless of past due status, the loan is considered to be a TDR. At June 30, 2017 and December 31, 2016, the Company had $5.2 million and $5.8 million, respectively, of accruing TDRs that had been restructured from the original terms in order to facilitate repayment.

Non-accruing TDRs at June 30, 2017 and December 31, 2016 totaled $21.7 million and $16.7 million, respectively.

During the six months ended June 30, 2017, the Company restructured five loans with a recorded investment of $6.8 million at June 30, 2017. Substantially all of the loan modifications were a reduction of the principal payment, a reduction in interest rate, or an extension of term. Loan modifications to loans accounted for under ASC 310-30 are not considered TDRs. The table below provides additional information related to accruing TDRs at June 30, 2017 and December 31, 2016:

	June 30, 2017
	Recorded		Average year-to-date		Unpaid		Unfunded commitments
	investment		recorded investments		principal balance		to fund TDRs
Commercial	$	3,258	$	3,270	$	3,488	$	100
Commercial real estate non-owner occupied		491		510		543		—
Residential real estate		1,424		1,450		1,435		2
Consumer		4		5		4		—
Total	$	5,177	$	5,235	$	5,470	$	102

	December 31, 2016
	Recorded		Average year-to-date		Unpaid		Unfunded commitments
	investment		recorded investments		principal balance		to fund TDRs
Commercial	$	3,302	$	3,440	$	3,464	$	100
Commercial real estate non-owner occupied		538		572		590		—
Residential real estate		1,920		1,996		1,969		2
Consumer		7		9		7		—
Total	$	5,767	$	6,017	$	6,030	$	102

The following table summarizes the Company’s carrying value of non-accrual TDRs as of June 30, 2017 and December 31, 2016:

	June 30, 2017		December 31, 2016
Commercial	$	20,246	$	15,265
Commercial real estate non-owner occupied		—		—
Residential real estate		1,308		1,301
Consumer		127		142
Total non-accruing TDRs	$	21,681	$	16,708

Accrual of interest is resumed on loans that were on non-accrual only after the loan has performed sufficiently. The Company had three TDRsthat were modified within the past twelve months and had defaulted on their restructured terms during the three months ended June 30, 2017, and five TDRs that were modified within the past twelve months and had defaulted on their restructured terms during the six months ended June 30, 2017. The defaulted TDRs consisted of one energy sector loan totaling $2.9 million, three commercial and industrial loans totaling $4.2 million and one small senior lien loan. The allowance for loan losses related to troubled debt restructurings on non-accrual status is determined by individual evaluation, including collateral adequacy, using the same process as loans on non-accrual status which are not classified as troubled debt restructurings.

During the three and six months ended June 30, 2016, the Company had one and five TDRs that had been modified within the past 12 months that defaulted on their restructured terms, respectively. For purposes of this disclosure, the Company considers “default” to mean 90 days or more past due on principal or interest.

20

Loans accounted for under ASC 310-30

Loan pools accounted for under ASC Topic 310-30 are periodically re-measured to determine expected future cash flows. In determining the expected cash flows, the timing of cash flows and prepayment assumptions for smaller homogeneous loans are based on statistical models that take into account factors such as the loan interest rate, credit profile of the borrowers, the years in which the loans were originated, and whether the loans are fixed or variable rate loans. Prepayments may be assumed on loans if circumstances specific to that loan warrant a prepayment assumption. The re-measurement of loans accounted for under ASC 310-30 resulted in the following changes in the carrying amount of accretable yield during the six months ended June 30, 2017 and 2016:

	June 30, 2017		June 30, 2016
Accretable yield beginning balance	$	60,476	$	84,194
Reclassification from non-accretable difference		7,732		5,646
Reclassification to non-accretable difference		(494)		(4,019)
Accretion		(12,051)		(18,056)
Accretable yield ending balance	$	55,663	$	67,765

Below is the composition of the net book value for loans accounted for under ASC 310-30 at June 30, 2017 and December 31, 2016:

	June 30, 2017		December 31, 2016
Contractual cash flows	$	514,149	$	537,611
Non-accretable difference		(324,059)		(331,283)
Accretable yield		(55,663)		(60,476)
Loans accounted for under ASC 310-30	$	134,427	$	145,852

Note 5 Allowance for Loan Losses

The tables below detail the Company’s allowance for loan losses (“ALL”) and recorded investment in loans as of and for the three and six months ended June 30, 2017 and 2016:

	Three months ended  June 30, 2017
			Non-owner
			occupied
			commercial		Residential
	Commercial		real estate		real estate		Consumer		Total
Beginning balance	$	20,539	$	5,815	$	4,216	$	280	$	30,850
Non 310-30 beginning balance		20,539		5,599		4,216		276		30,630
Charge-offs		—		—		(2)		(119)		(121)
Recoveries		30		10		110		55		205
Provision		4,087		191		(257)		82		4,103
Non 310-30 ending balance		24,656		5,800		4,067		294		34,817
ASC 310-30 beginning balance		—		216		—		4		220
Charge-offs		—		—		—		—		—
Recoveries		—		—		—		—		—
(Recoupment) provision		—		(82)		—		4		(78)
ASC 310-30 ending balance		—		134		—		8		142
Ending balance	$	24,656	$	5,934	$	4,067	$	302	$	34,959

21

	Three months ended  June 30, 2016
			Non-owner
			occupied
			commercial		Residential
	Commercial		real estate		real estate		Consumer		Total
Beginning balance	$	28,684	$	3,861	$	4,325	$	296	$	37,166
Non 310-30 beginning balance		28,610		3,803		4,289		249		36,951
Charge-offs		(3,375)		—		(140)		(171)		(3,686)
Recoveries		12		56		16		126		210
Provision		4,733		1,298		339		30		6,400
Non 310-30 ending balance		29,980		5,157		4,504		234		39,875
ASC 310-30 beginning balance		74		58		36		47		215
Charge-offs		—		(41)		—		—		(41)
Recoveries		—		—		—		—		—
(Recoupment) provision		(72)		194		(36)		(29)		57
ASC 310-30 ending balance		2		211		—		18		231
Ending balance	$	29,982	$	5,368	$	4,504	$	252	$	40,106

	Six months ended June 30, 2017
			Non-owner
			occupied
			commercial		Residential
	Commercial		real estate		real estate		Consumer		Total
Beginning balance	$	18,821	$	5,642	$	4,387	$	324	$	29,174
Non 310-30 beginning balance		18,821		5,422		4,387		319		28,949
Charge-offs		(20)		—		(10)		(301)		(331)
Recoveries		41		20		113		122		296
Provision		5,814		358		(423)		154		5,903
Non 310-30 ending balance		24,656		5,800		4,067		294		34,817
ASC 310-30 beginning balance		—		220		—		5		225
Charge-offs		—		—		—		—		—
Recoveries		—		—		—		—		—
(Recoupment) provision		—		(86)		—		3		(83)
ASC 310-30 ending balance		—		134		—		8		142
Ending balance	$	24,656	$	5,934	$	4,067	$	302	$	34,959
Ending allowance balance attributable to:
Non 310-30 loans individually evaluated for impairment	$	6,197	$	1	$	45	$	1	$	6,244
Non 310-30 loans collectively evaluated for impairment		18,459		5,799		4,022		293		28,573
ASC 310-30 loans		—		134		—		8		142
Total ending allowance balance	$	24,656	$	5,934	$	4,067	$	302	$	34,959
Loans:
Non 310-30 individually evaluated for impairment	$	30,458	$	551	$	8,205	$	165	$	39,379
Non 310-30 collectively evaluated for impairment		1,709,018		472,684		706,294		26,143		2,914,139
ASC 310-30 loans		35,978		83,785		14,012		652		134,427
Total loans	$	1,775,454	$	557,020	$	728,511	$	26,960	$	3,087,945

22

	Six months ended June 30, 2016
			Non-owner
			occupied
			commercial		Residential
	Commercial		real estate		real estate		Consumer		Total
Beginning balance	$	17,261	$	4,166	$	5,281	$	411	$	27,119
Non 310-30 beginning balance		16,473		3,939		5,245		385		26,042
Charge-offs		(3,484)		(276)		(197)		(388)		(4,345)
Recoveries		24		65		23		185		297
Provision		16,967		1,429		(567)		52		17,881
Non 310-30 ending balance		29,980		5,157		4,504		234		39,875
ASC 310-30 beginning balance		788		227		36		26		1,077
Charge-offs		—		(41)		—		—		(41)
Recoveries		—		—		—		—		—
(Recoupment) provision		(786)		25		(36)		(8)		(805)
ASC 310-30 ending balance		2		211		—		18		231
Ending balance	$	29,982	$	5,368	$	4,504	$	252	$	40,106
Ending allowance balance attributable to:
Non 310-30 loans individually evaluated for impairment	$	14,933	$	3	$	39	$	2	$	14,977
Non 310-30 loans collectively evaluated for impairment		15,047		5,154		4,465		232		24,898
ASC 310-30 loans		2		211		—		18		231
Total ending allowance balance	$	29,982	$	5,368	$	4,504	$	252	$	40,106
Loans:
Non 310-30 individually evaluated for impairment	$	37,265	$	842	$	7,369	$	240	$	45,716
Non 310-30 collectively evaluated for impairment		1,406,609		423,178		667,461		26,258		2,523,506
ASC 310-30 loans		46,875		101,719		19,341		1,347		169,282
Total loans	$	1,490,749	$	525,739	$	694,171	$	27,845	$	2,738,504

In evaluating the loan portfolio for an appropriate ALL level, non-impaired loans that were not accounted for under ASC 310-30 were grouped into segments based on broad characteristics such as primary use and underlying collateral. Within the segments, the portfolio was further disaggregated into classes of loans with similar attributes and risk characteristics for purposes of applying loss ratios and determining applicable subjective adjustments to the ALL. The application of subjective adjustments was based upon qualitative risk factors, including economic trends and conditions, industry conditions, asset quality, loss trends, lending management, portfolio growth and loan review/internal audit results.

Net charge-offs on non 310-30 loans during the three and six months ended June 30, 2017 were $0.1 million and $0.0 million, respectively. Management's evaluation of credit quality resulted in a provision for loan losses on the non 310-30 loans of $4.1 million and $5.9 million during the three and six months ended June 30, 2017, respectively. Provision for the three months ended June 30, 2017 included specific reserves of $2.1 million on one commercial loan and general reserves on net loan growth. Provision for the six months ended June 30, 2017 included specific reserves totaling $3.4 million on one energy sector and one commercial sector loan.

During the six months ended June 30, 2017, the Company re-estimated the expected cash flows of the loan pools accounted for under ASC 310-30. The re-measurement resulted in a net recoupment of $78 thousand and $83 thousand for the three and six months ended June 30, 2017, respectively. The net recoupment was primarily due to a recoupment of $82 thousand in the non-owner occupied commercial real estate segment during the three months ended June 30, 2017, and primarily due to a recoupment of $86 thousand in the non-owner occupied commercial real estate segment for the six months ended June 30, 2017.

Net charge-offs on non 310-30 loans during the three and six months ended June 30, 2016 were $3.5 million and $4.0 million, respectively. Management’s evaluation resulted in a provision for loan losses on the non 310-30 loans of $6.4 million and $17.9 million during the three and six months ended June 30, 2016, respectively. The increase in provision was driven by a $4.3 million increase in reserves against the energy sector portfolio for the three months ended June 30, 2016 and a net $15.1 million increase for the six months ended June 30, 2016.

23

During the six months ended June 30, 2016, the Company re-estimated the expected cash flows of the loan pools accounted for under ASC 310-30. The re-measurement resulted in a net provision of $57 thousand and a net recoupment of $805 thousand for the three and six months ended June 30, 2016, respectively, which was comprised primarily of a provision of $195 thousand in the non-owner occupied commercial real estate segment, partially offset by recoupments of $73 thousand and $3 thousand in the commercial real estate and residential real estate segments, respectively, for the three months ended June 30, 2016, and primarily a recoupment of $786 thousand in the commercial segment for the six months ended June 30, 2016. 

Note 6 Other Real Estate Owned

The table below details the OREO activity during the six months ended June 30, 2017 and 2016:

	For the six months ended June 30,
	2017		2016
Beginning balance	$	15,662	$	20,814
Transfers from loan portfolio, at fair value		639		3,654
Impairments		(46)		(104)
Sales, net		(1,958)		(1,122)
Ending balance	$	14,297	$	23,242

The Company did not have any minority interest in participated other real estate owned at June 30, 2017. At December 31, 2016, OREO balances excluded $1.6 million of the Company’s minority interests in OREO, which are held by outside banks where the Company was not the lead bank and does not have a controlling interest. The Company maintains a receivable in other assets for these minority interests. Included in Sales, net are net gains of $1.8 million and $2.0 million for the six months ended June 30, 2017 and 2016, respectively.

Note 7 Borrowings

As of June 30, 2017 and December 31, 2016, the Company sold securities under agreements to repurchase totaling $119.2 million and $92.0 million, respectively, and none were for periods longer than one day. The Company pledged mortgage-backed securities with a fair value of approximately $123.4 million and $99.1 million as of June 30, 2017 and December 31, 2016, respectively, for these agreements. The Company monitors collateral levels on a continuous basis and may be required to provide additional collateral based on the fair value of the underlying securities. As of June 30, 2017 and December 31, 2016, the Company had $4.2 million and $7.0 million of excess collateral pledged for repurchase agreements. The repurchase agreements are subject to a master netting arrangement; however, the Company has not offset any of the amounts presented in the consolidated financial statements.

As a member of the FHLB, the Bank has access to a line of credit and term financing from the FHLB with total available credit of $763.6 million at June 30, 2017. At June 30, 2017 and December 31, 2016, the Bank had $129.1 million and $25.0 million in term advances from the FHLB, respectively. The term advances have fixed interest rates of 1.31% - 2.33%, with maturity dates of 2018 - 2020. The Bank had investment securities pledged as collateral for FHLB advances in the amount of $26.1 million at June 30, 2017 and $28.8 million at December 31, 2016. Interest expense related to FHLB advances totaled $496 thousand and $693 thousand for the three and six months ended June 30, 2017, respectively, and $166 thousand and $332 thousand for the three and six months ended June 30, 2016, respectively.

Note 8 Regulatory Capital

As a bank holding company, the Company is subject to regulatory capital adequacy requirements implemented by the Federal Reserve. The federal banking agencies have risk-based capital adequacy regulations intended to provide a measure of capital adequacy that reflects the degree of risk associated with a banking organization’s operations. Under these regulations, assets are assigned to one of several risk categories, and nominal dollar amounts of assets and credit equivalent amounts of off-balance-sheet items are multiplied by a risk adjustment percentage for the category.

The new Basel III rules, effective January 1, 2015, changed the components of regulatory capital and changed the way in which risk ratings are assigned to various categories of bank assets. Also, a new Tier I common risk-based ratio was defined. Under the Basel III requirements, at June 30, 2017, the Company and the Bank met all capital requirements and the Bank had regulatory capital ratios in excess of the levels established for well-capitalized institutions.

24

At June 30, 2017 and December 31, 2016, the Bank met the requirements to be considered “well capitalized” under the regulatory framework for prompt corrective action. To be categorized as “well-capitalized”, the Bank must maintain capital ratios as set forth in the table below. The following table sets forth the capital ratios of the Company and the Bank at June 30, 2017 and December 31, 2016.

	June 30, 2017
				Required to be			Required to be
				well capitalized under			considered
				prompt corrective			adequately
	Actual			action provisions			capitalized
	Ratio	Amount		Ratio	Amount		Ratio	Amount
Tier 1 leverage ratio:
Consolidated	10.3%	$	472,627	N/A		N/A	4.0%	$	184,402
NBH Bank	8.4%		385,466	4.5%	$	206,721	4.0%		183,752
Common equity tier 1 risk-based capital:
Consolidated	13.3%	$	472,627	N/A		N/A	4.5%	$	207,452
NBH Bank	10.9%		385,466	6.5%	$	298,597	4.5%		206,721
Tier 1 risk-based capital ratio:
Consolidated	13.3%	$	472,627	N/A		N/A	6.0%	$	213,366
NBH Bank	10.9%		385,466	8.0%	$	283,313	6.0%		212,485
Total risk-based capital ratio:
Consolidated	14.3%	$	507,912	N/A		N/A	8.0%	$	284,488
NBH Bank	11.9%		420,750	10.0%	$	354,141	8.0%		283,313

	December 31, 2016
				Required to be			Required to be
				well capitalized under			considered
				prompt corrective			adequately
	Actual			action provisions			capitalized
	Ratio	Amount		Ratio	Amount		Ratio	Amount
Tier 1 leverage ratio:
Consolidated	10.4%	$	470,259	N/A		N/A	4.0%	$	181,019
NBH Bank	8.6%		389,189	4.5%	$	202,903	4.0%		180,358
Common equity tier 1 risk-based capital:
Consolidated	14.2%	$	470,259	N/A		N/A	4.5%	$	203,647
NBH Bank	11.8%		389,189	6.5%	$	293,082	4.5%		202,903
Tier 1 risk-based capital ratio:
Consolidated	14.2%	$	470,259	N/A		N/A	6.0%	$	199,467
NBH Bank	11.8%		389,189	8.0%	$	264,596	6.0%		198,447
Total risk-based capital ratio:
Consolidated	15.0%	$	499,759	N/A		N/A	8.0%	$	265,955
NBH Bank	12.7%		418,689	10.0%	$	330,745	8.0%		264,596

Note 9 Stock-based Compensation and Benefits

The Company provides stock-based compensation in accordance with shareholder-approved plans. During the second quarter of 2014, shareholders approved the 2014 Omnibus Incentive Plan (the "2014 Plan"). The 2014 Plan replaces the NBH Holdings Corp. 2009 Equity Incentive Plan (the "Prior Plan"), pursuant to which the Company granted equity awards prior to the approval of the 2014 Plan. Pursuant to the 2014 Plan, the Compensation Committee of the Board of Directors has the authority to grant, from time to time, awards of stock options, stock appreciation rights, restricted stock, restricted stock units, performance units, other stock-based awards, or any combination thereof to eligible persons.

Stock options

The Company issued stock options during the six months ended June 30, 2017 and 2016, which are primarily time-vesting with 1/3 vesting on each of the first, second and third anniversary of the date of grant or date of hire.

The expense associated with the awarded stock options was measured at fair value using a Black-Scholes option-pricing model. The outstanding unvested option awards vest on a graded basis over 1-3 years of continuous service and have 7-10 year contractual terms.

25

The Company issued stock options in accordance with the 2014 Plan during 2017. The following table summarizes stock option activity for the six months ended June 30, 2017:

				Weighted
				average
		Weighted		remaining
		average		contractual	Aggregate
		exercise		term in	intrinsic
	Options	price		years	value
Outstanding at December 31, 2016	2,185,922	$	19.81	4.85	$	7,753
Granted	99,920		33.98
Exercised	(585,750)		19.93
Forfeited	(16,225)		21.84
Outstanding at June 30, 2017	1,683,867	$	20.61	4.52	$	21,136
Options exercisable at June 30, 2017	1,429,584	$	19.80	3.77	$	19,021
Options expected to vest	1,662,690	$	20.53	4.46	$	20,994

Stock option expense is a component of salaries and benefits in the consolidated statements of operations and totaled $0.2 million for the three months ended June 30, 2017 and 2016, and $0.4 million for the six months ended June 30, 2017 and 2016, respectively. At June 30, 2017, there was $0.8 million of total unrecognized compensation cost related to non-vested stock options granted under the plans. The cost is expected to be recognized over a weighted average period of 2.4 years.

Restricted stock awards

The Company issued time based restricted stock awards during the six months ended June 30, 2017 and 2016. The restricted stock awards vest over a range of a 1 - 3 year period. Restricted stock with time-based vesting was valued at the fair value of the shares on the date of grant as they are assumed to be held beyond the vesting period.

No market-based stock awards were granted during the six months ended June 30, 2017. During six months ended June 30, 2016, the Company granted market-based awards of 26,594 shares in accordance with the 2014 Plan. These shares have a five-year performance period. The restricted stock shares vest upon the later of the Company’s stock price achieving an established price goal during the performance period, and the third anniversary of the date of grant. The fair value of these awards was determined using a Monte Carlo Simulation at grant date. The grant date fair value of these awards was $11.28. As of June 30, 2017, the market-based performance condition had been met for these awards and the total unrecognized compensation cost related to non-vested awards totaled $0.3 million, and is expected to be recognized over a weighted average period of approximately 1.9 years.

Performance stock units

During the six months ended June 30, 2017 and 2016, the Company granted 49,758 and 91,342 performance stock units in accordance with the 2014 Plan, respectively. These performance stock units granted represent initial target awards and do not reflect potential increases or decreases resulting from the final performance results, which are to be determined at the end of the three-year performance period (vesting date). The actual number of shares to be awarded at the end of the performance period will range from 0% - 150% of the initial target awards. 60% of the award is based on the Company’s cumulative earnings per share (EPS target) during the performance period, and 40% of the award is based on the Company’s cumulative total shareholder return (TSR target), or TSR, during the performance period. On the vesting date, the Company’s TSR will be compared to the respective TSRs of the companies comprising the KBW Regional Index at the grant date to determine the shares awarded. The fair value of the EPS target portion of the award was determined based on the closing stock price of the Company’s common stock on the grant date. The fair value of the TSR target portion of the award was determined using a Monte Carlo Simulation at the grant date. The weighted-average grant date fair value per unit for awards granted during the six months ended June 30, 2017 of the EPS target portion and the TSR target portion was $34.04 and $32.06, respectively.

26

The following table summarizes restricted stock and performance stock activity during the six months ended June 30, 2017:

		Weighted				Weighted
	Restricted	average grant-		Performance		average grant-
	shares	date fair value		stock units		date fair value
Unvested at December 31, 2016	499,271	$	15.82	85,295	$	18.22
Granted	65,990		33.43	49,758		33.22
Vested	(298,086)		15.27	—		—
Forfeited	(11,111)		22.23	(5,994)		20.90
Unvested at June 30, 2017	256,064	$	20.82	129,059	$	23.88

As of June 30, 2017, the total unrecognized compensation cost related to non-vested restricted stock awards and units totaled $4.5 million, and is expected to be recognized over a weighted average period of approximately 2.1 years. Expense related to non-vested restricted awards and units totaled $0.8 million and $0.7 million during the three months ended June 30, 2017 and 2016, respectively, and $1.4 million during the six months ended June 30, 2017 and 2016, and is a component of salaries and benefits in the Company’s consolidated statements of operations.

Employee Stock Purchase Plan

The 2014 Employee Stock Purchase Plan (“ESPP”) is intended to be a qualified plan within the meaning of Section 423 of the Internal Revenue Code of 1986 and allows eligible employees to purchase shares of common stock through payroll deductions up to a limit of $25,000 per calendar year and 2,000 shares per offering period. The price an employee pays for shares is 90.0% of the fair market value of Company common stock on the last day of the offering period. The offering period is the six-month period commencing on March 1 and September 1 of each year and ending on August 31 and February 28 (or February 29 in the case of a leap year) of each year. There is no vesting or other restrictions on the stock purchased by employees under the ESPP. Under the ESPP, the total number of shares of common stock reserved for issuance totaled 400,000 shares, of which 360,963 were available for issuance.

Under the ESPP, employees purchased 5,373 shares during the six months ended June 30, 2017.

Note 10 Warrants

During the first quarter of 2017, 250,750 warrants were exercised in a non-cash transaction, representing the remaining outstanding warrants. The warrants were granted to certain lead shareholders of the Company at the time of the Company’s initial capital raise (2009-2010), all with an exercise price of $20.00 per share. Refer to the consolidated statements of changes in shareholders’ equity for additional detail.

Note 11 Common Stock

The Company had 26,788,833 and 26,386,583 shares of Class A common stock outstanding at June 30, 2017 and December 31, 2016, respectively. Additionally, the Company had 256,064 and 499,271 shares outstanding at June 30, 2017 and December 31, 2016, respectively, of restricted Class A common stock issued but not yet vested under the 2014 Omnibus Incentive Plan and the Prior Plan that are not included in shares outstanding until such time that they are vested; however, these shares do have voting and certain dividend rights during the vesting period.

On August 5, 2016, the Board of Directors authorized a new share repurchase program for up to $50.0 million from time to time in either the open market or through privately negotiated transactions. The remaining authorization under this program as of June 30, 2017 was $12.6 million.

Note 12 Income Per Share

The Company calculates income per share under the two-class method, as certain non-vested share awards contain non-forfeitable rights to dividends. As such, these awards are considered securities that participate in the earnings of the Company. Non-vested shares are discussed further in note 9.

The Company had 26,788,833 and 28,810,883 shares of Class A common stock outstanding as of June 30, 2017 and 2016, respectively, exclusive of issued non-vested restricted shares. Certain stock options and non-vested restricted shares are potentially

27

dilutive securities, but are not included in the calculation of diluted income per share because to do so would have been anti-dilutive for the three and six months ended June 30, 2017 and 2016.

The following table illustrates the computation of basic and diluted income per share for the three and six months ended June 30, 2017 and 2016:

	For the three months ended				For the six months ended
	June 30, 2017		June 30, 2016		June 30, 2017		June 30, 2016
Net income	$	9,209	$	4,504	$	17,467	$	4,755
Less: income allocated to participating securities		(14)		(12)		(30)		(25)
Income allocated to common shareholders	$	9,195	$	4,492	$	17,437	$	4,730
Weighted average shares outstanding for basic income per common share		26,955,187		29,215,822		26,878,904		29,666,570
Dilutive effect of equity awards		642,256		49,461		742,001		37,643
Dilutive effect of warrants		—		13,476		16,627		3,166
Weighted average shares outstanding for diluted income per common share		27,597,443		29,278,759		27,637,532		29,707,379
Basic income per share	$	0.34	$	0.15	$	0.65	$	0.16
Diluted income per share	$	0.33	$	0.15	$	0.63	$	0.16

The Company had 1,683,867 and 2,703,752 outstanding stock options to purchase common stock at weighted average exercise prices of $20.61 and $19.82 per share at June 30, 2017 and 2016, respectively, which have time-vesting criteria, and as such, any dilution is derived only for the time frame in which the vesting criteria had been met and where the inclusion of those stock options is dilutive. Additionally, 250,750 warrants were exercised in a non-cash transaction during the first quarter of 2017, representing the remaining outstanding warrants to purchase shares of the Company’s common stock. The warrants had an exercise price of $20.00, which were in-the-money for purposes of the dilution calculations during the six months ended June 30, 2017, and three and six months ended June 30, 2016. The Company had 256,064 and 918,890 unvested restricted shares and units issued as of June 30, 2017 and 2016, respectively, which have performance, market and/or time-vesting criteria, and as such, any dilution is derived only for the time frame in which the vesting criteria had been met and where the inclusion of those restricted shares and units is dilutive.

Note 13 Income Taxes

The effective income tax rate for the three and six months ended June 30, 2017 was an expense of 19.10% and 5.1%, respectively, compared to an expense of 17.9% and 19.8% for the three and six months ended June 30, 2016, calculated based on a full year forecast method. The tax expense recorded for the three and six months ended June 30, 2017 was lowered by a $0.5 million and $3.4 million tax benefit from stock compensation activity during the respective periods. Without the discrete items related to stock compensation activity, the three and six month ended June 30, 2017 effective tax rate was consistent period-to-period. The quarterly tax rate differs from the federal statutory rate primarily due to tax benefits from stock compensation activity, interest income from tax-exempt lending, bank-owned life insurance income, and the relationship of these items to pre-tax income. See management’s discussion and analysis for further information.

Note 14 Derivatives

Risk management objective of using derivatives

The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company has established policies that neither carrying value nor fair value at risk should exceed established guidelines. The Company has designed strategies to confine these risks within the established limits and identify appropriate trade-offs in the financial structure of its balance sheet. These strategies include the use of derivative financial instruments to help achieve the desired balance sheet repricing structure while meeting the desired objectives of its clients. Currently, the Company employs certain interest rate swaps that are designated as fair value hedges as well as economic hedges. The Company manages a matched book with respect to its derivative instruments in order to minimize its net risk exposure resulting from such transactions.

28

Fair values of derivative instrument on the balance sheet

The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the consolidated statements of financial condition as of June 30, 2017 and December 31, 2016.

Information about the valuation methods used to measure fair value is provided in note 16.

		Asset derivatives fair value					Liability derivatives fair value
	Balance Sheet	June 30,		December 31,		Balance Sheet	June 30,		December 31,
	location	2017		2016		location	2017		2016
Derivatives designated as hedging instruments:
Interest rate products	Other assets	$	8,310	$	9,528	Other liabilities	$	2,268	$	1,381
Total derivatives designated as hedging instruments		$	8,310	$	9,528		$	2,268	$	1,381
Derivatives not designated as hedging instruments:
Interest rate products	Other assets	$	2,384	$	1,900	Other liabilities	$	2,461	$	1,898
Interest rate lock commitments	Other assets		143		149	Other liabilities		—		6
Forward contracts	Other assets		14		138	Other liabilities		26		20
Total derivatives not designated as hedging instruments		$	2,541	$	2,187		$	2,487	$	2,085

Fair value hedges

Interest rate swaps designated as fair value hedges involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without the exchange of the underlying notional amount. As of June 30, 2017, the Company had 52 interest rate swaps with a notional amount of $372.1 million that were designated as fair value hedges of interest rate risk associated with the Company’s fixed-rate loans. As of December 31, 2016, the Company had 42 interest rate swaps with a notional amount of $313.0 million that were designated as fair value hedges. 

For derivatives designated and that qualify as fair value hedges, the gain or loss on the derivative as well as the offsetting loss or gain on the hedged item attributable to the hedged risk are recognized in earnings. The Company includes the gain or loss on the hedged items in the same line item as the offsetting loss or gain on the related derivatives. During the three and six months ended June 30, 2017, the Company recognized a net loss of $207 thousand and $385 thousand, respectively, in non-interest income related to hedge ineffectiveness. During the three and six months ended June 30 2016, the Company recognized a net loss of $462 thousand and $1.1 million, respectively, in non-interest income related to hedge ineffectiveness.

Non-designated hedges

Derivatives not designated as hedges are not speculative and consist of interest rate swaps with commercial banking clients that facilitate their respective risk management strategies. Interest rate swaps are simultaneously hedged by offsetting interest rate swaps that the Company executes with a third party, such that the Company minimizes its net risk exposure resulting from such transactions. As the interest rate swaps associated with this program do not meet the strict hedge accounting requirements, changes in the fair value of both the client swaps and the offsetting swaps are recognized directly in earnings. As of June 30, 2017, the Company had 39 matched interest rate swap transactions with an aggregate notional amount of $161.3 million related to this program. As of December 31, 2016, the Company had 36 matched interest rate swap transactions with an aggregate notional amount of $132.6 million related to this program. 

As part of its mortgage banking activities, the Company enters into interest rate lock commitments, which are commitments to originate loans where the interest rate on the loan is determined prior to funding and the customers have locked into that interest rate. The Company then locks in the loan and interest rate with an investor and commits to deliver the loan if settlement occurs ("best efforts") or commits to deliver the locked loan in a binding ("mandatory") delivery program with an investor. Fair value changes of certain loans under interest rate lock commitments are hedged with forward sales contracts of MBS. Forward sales contracts of MBS are recorded at fair value with changes in fair value recorded in non-interest income. Interest rate lock commitments and commitments to deliver loans to investors are considered derivatives. The market value of interest rate lock commitments and best efforts contracts are not readily ascertainable with precision because they are not actively traded in stand-alone markets. The Company determines the fair value of interest rate lock commitments and delivery contracts by measuring the fair value of the underlying asset, which is

29

impacted by current interest rates, taking into consideration the probability that the interest rate lock commitments will close or will be funded.

Certain additional risks arise from these forward delivery contracts in that the counterparties to the contracts may not be able to meet the terms of the contracts. The Company does not expect any counterparty to any MBS contract to fail to meet its obligation. Additional risks inherent in mandatory delivery programs include the risk that, if the Company fails to deliver the loans subject to interest rate risk lock commitments, it will still be obligated to “pair off” MBS to the counterparty. Should this be required, the Company could incur significant costs in acquiring replacement loans and such costs could have an adverse effect on the consolidated financial statements.

The fair value of the mortgage banking derivative is recorded as a freestanding asset or liability with the change in value being recognized in current earnings during the period of change.

The Company had 59 interest rate lock commitments with a notional value of $12.4 million and nine forward contracts with a notional value of $10.0 million at June 30, 2017. At December 31, 2016, the Company had 78 interest rate lock commitments, with a notional value of $13.8 million, and eleven forward contracts with a notional value of $11.8 million.

Effect of derivative instruments on the consolidated statements of operations

The tables below present the effect of the Company’s derivative financial instruments on the consolidated statements of operations for the three and six months ended June 30, 2017 and 2016:

	Location of gain (loss)	Amount of gain (loss) recognized in income on derivatives
Derivatives in fair value	recognized in income on	For the three months ended June 30,				For the six months ended June 30,
hedging relationships	derivatives	2017		2016		2017		2016
Interest rate products	Other non-interest income	$	(3,169)	$	(6,513)	$	(2,105)	$	(17,414)
Total		$	(3,169)	$	(6,513)	$	(2,105)	$	(17,414)

	Location of gain (loss)	Amount of gain (loss) recognized in income on hedged items
	recognized in income on	For the three months ended June 30,				For the six months ended June 30,
Hedged items	hedged items	2017		2016		2017		2016
Interest rate products	Other non-interest income	$	2,962	$	6,051	$	1,720	$	16,281
Total		$	2,962	$	6,051	$	1,720	$	16,281

	Location of gain (loss)	Amount of gain (loss) recognized in income on derivatives
Derivatives not designated	recognized in income on	For the three months ended June 30,				For the six months ended June 30,
as hedging instruments	derivatives	2017		2016		2017		2016
Interest rate products	Other non-interest expense	$	(47)	$	(89)	$	(79)	$	(183)
Interest rate lock commitments	Gain on sale of mortgages, net		(122)		332		1		332
Forward contracts	Gain on sale of mortgages, net		63		(178)		(131)		(178)
Total		$	(106)	$	65	$	(209)	$	(29)

Credit-risk-related contingent features

The Company has agreements with its derivative counterparties that contain a provision where if the Company defaults on any of its indebtedness for reasons other than an error or omission of an administrative or operational nature, including default where repayment of the indebtedness has not been accelerated by the lender, then the Company could also be declared in default on its derivative obligations.

The Company also has agreements with certain of its derivative counterparties that contain a provision where if the Company fails to maintain its status as a well/adequately capitalized institution, then the counterparty has the right to terminate the derivative positions and the Company would be required to settle its obligations under the agreements.

As of June 30, 2017 and December 31, 2016, the termination value of derivatives in a net liability position related to these agreements was $1.1 million and $1.3 million, respectively, which includes accrued interest but excludes any adjustment for nonperformance risk. The Company has minimum collateral posting thresholds with certain of its derivative counterparties and as of June 30, 2017 and December 31, 2016, the Company had posted $2.8 million and $0.8 million, respectively, in eligible collateral. If the Company had

30

breached any of these provisions at June 30, 2017, it could have been required to settle its obligations under the agreements at the termination value.

Note 15 Commitments and Contingencies

In the normal course of business, the Company enters into various off-balance sheet commitments to help meet the financing needs of clients. These financial instruments include commitments to extend credit, commercial and consumer lines of credit and standby letters of credit. The same credit policies are applied to these commitments as the loans on the consolidated statements of financial condition; however, these commitments involve varying degrees of credit risk in excess of the amount recognized in the consolidated statements of financial condition. At June 30, 2017 and December 31, 2016, the Company had loan commitments totaling $648.2 million and $602.2 million, respectively, and standby letters of credit that totaled $15.0 million and $13.5 million, respectively. The total amounts of unused commitments do not necessarily represent future credit exposure or cash requirements, as commitments often expire without being drawn upon. However, the contractual amount of these commitments, offset by any additional collateral pledged, represents the Company’s potential credit loss exposure.

Total unfunded commitments at June 30, 2017 and December 31, 2016 were as follows:

	June 30, 2017		December 31, 2016
Commitments to fund loans	$	181,052	$	149,391
Unfunded commitments under lines of credit		467,180		452,851
Commercial and standby letters of credit		15,030		13,532
Total unfunded commitments	$	663,262	$	615,774

Commitments to fund loans—Commitments to fund loans are legally binding agreements to lend to clients in accordance with predetermined contractual provisions providing there have been no violations of any conditions specified in the contract. These commitments are generally at variable interest rates and are for specific periods or contain termination clauses and may require the payment of a fee. The total amounts of unused commitments are not necessarily representative of future credit exposure or cash requirements, as commitments often expire without being drawn upon.

Unfunded commitments under lines of credit—In the ordinary course of business, the Company extends revolving credit to its clients. These arrangements may require the payment of a fee.

Commercial and standby letters of credit—As a provider of financial services, the Company routinely issues commercial and standby letters of credit, which may be financial standby letters of credit or performance standby letters of credit. These are various forms of “back-up” commitments to guarantee the performance of a client to a third party. While these arrangements represent a potential cash outlay for the Company, the majority of these letters of credit will expire without being drawn upon. Letters of credit are subject to the same underwriting and credit approval process as traditional loans, and as such, many of them have various forms of collateral securing the commitment, which may include real estate, personal property, receivables or marketable securities.

Contingencies

In the ordinary course of business, the Company and the Bank may be subject to litigation. Based upon the available information and advice from the Company’s legal counsel, management does not believe that any potential, threatened or pending litigation to which it is a party will have a material adverse effect on the Company’s liquidity, financial condition or results of operations.

Note 16 Fair Value Measurements

The Company uses fair value measurements to record fair value adjustments to certain assets and liabilities and to disclose the fair value of its financial instruments. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. For disclosure purposes, the Company groups its financial and non-financial assets and liabilities into three different levels based on the nature of the instrument and the availability and reliability of the information that is used to determine fair value. The three levels are defined as follows:

· Level 1—Includes assets or liabilities in which the inputs to the valuation methodologies are based on unadjusted quoted prices in active markets for identical assets or liabilities.

31

· Level 2—Includes assets or liabilities in which the inputs to the valuation methodologies are based on similar assets or liabilities in inactive markets, quoted prices for identical or similar assets or liabilities in inactive markets, and inputs other than quoted prices that are observable, such as interest rates, yield curves, volatilities, prepayment speeds, and other inputs obtained from observable market input.

· Level 3—Includes assets or liabilities in which the inputs to the valuation methodology are based on at least one significant assumption that is not observable in the marketplace. These valuations may rely on management’s judgment and may include internally-developed model-based valuation techniques.

Level 1 inputs are considered to be the most transparent and reliable and level 3 inputs are considered to be the least transparent and reliable. The Company assumes the use of the principal market to conduct a transaction of each particular asset or liability being measured and then considers the assumptions that market participants would use when pricing the asset or liability. Whenever possible, the Company first looks for quoted prices for identical assets or liabilities in active markets (level 1 inputs) to value each asset or liability. However, when inputs from identical assets or liabilities on active markets are not available, the Company utilizes market observable data for similar assets and liabilities. The Company maximizes the use of observable inputs and limits the use of unobservable inputs to occasions when observable inputs are not available. The need to use unobservable inputs generally results from the lack of market liquidity of the actual financial instrument or of the underlying collateral. Although, in some instances, third party price indications may be available, limited trading activity can challenge the observability of these quotations.

Changes in the valuation inputs used for measuring the fair value of financial instruments may occur due to changes in current market conditions or other factors. Such changes may necessitate a transfer of the financial instruments to another level in the hierarchy based on the new inputs used. The Company recognizes these transfers at the end of the reporting period that the transfer occurs. During the six months ended June 30, 2017 and 2016, there were no transfers of financial instruments between the hierarchy levels.

The following is a description of the valuation methodologies used for assets and liabilities measured at fair value, as well as the general classification of each instrument under the valuation hierarchy:

Fair Value of Financial Instruments Measured on a Recurring Basis

Investment securities available-for-sale—Investment securities available-for-sale are carried at fair value on a recurring basis. To the extent possible, observable quoted prices in an active market are used to determine fair value and, as such, these securities are classified as level 1. At June 30, 2017 and December 31, 2016, the Company did not hold any level 1 securities. When quoted market prices in active markets for identical assets or liabilities are not available, quoted prices of securities with similar characteristics, discounted cash flows or other pricing characteristics are used to estimate fair values and the securities are then classified as level 2.

Interest rate swap derivatives—The Company's derivative instruments are limited to interest rate swaps that may be accounted for as fair value hedges or non-designated hedges. The fair values of the swaps incorporate credit valuation adjustments in order to appropriately reflect nonperformance risk in the fair value measurements. The credit valuation adjustment is the dollar amount of the fair value adjustment related to credit risk and utilizes a probability weighted calculation to quantify the potential loss over the life of the trade. The credit valuation adjustments are calculated by determining the total expected exposure of the derivatives (which incorporates both the current and potential future exposure) and then applying the respective counterparties’ credit spreads to the exposure offset by marketable collateral posted, if any. Certain derivative transactions are executed with counterparties who are large financial institutions ("dealers"). International Swaps and Derivative Association Master Agreements ("ISDA") and Credit Support Annexes ("CSA") are employed for all contracts with dealers. These contracts contain bilateral collateral arrangements. The fair value inputs of these financial instruments are determined using discounted cash flow analysis through the use of third-party models whose significant inputs are readily observable market parameters, primarily yield curves, with appropriate adjustments for liquidity and credit risk, and are classified as level 2.

Mortgage banking derivatives—The Company relies on a third-party pricing service to value its mortgage banking derivative financial assets and liabilities, which the Company classifies as a level 3 valuation. The external valuation model to estimate the fair value of its interest rate lock commitments to originate residential mortgage loans held for sale includes grouping the interest rate lock commitments by interest rate and terms, applying an estimated pull-through rate based on historical experience, and then multiplying by quoted investor prices determined to be reasonably applicable to the loan commitment groups based on interest rate, terms, and rate lock expiration dates of the loan commitment groups. The Company also relies on an external valuation model to estimate the fair value of its forward commitments to sell residential mortgage loans (i.e., an estimate of what the Company would receive or pay to terminate the forward delivery contract based on market prices for similar financial instruments), which includes matching specific terms and maturities of the forward commitments against applicable investor pricing.

32

The tables below present the financial instruments measured at fair value on a recurring basis as of June 30, 2017 and December 31, 2016 on the consolidated statements of financial condition utilizing the hierarchy structure described above:

	June 30, 2017
	Level 1		Level 2		Level 3		Total
Assets:
Investment securities available-for-sale:
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	—	$	195,341	$	—	$	195,341
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		—		668,631		—		668,631
Municipal securities		—		2,058		—		2,058
Interest rate swap derivatives		—		10,694		—		10,694
Mortgage banking derivatives		—		—		157		157
Total assets at fair value	$	—	$	876,724	$	157	$	876,881
Liabilities:
Interest rate swap derivatives	$	—	$	4,729	$	—	$	4,729
Mortgage banking derivatives		—		—		26		26
Total liabilities at fair value	$	—	$	4,729	$	26	$	4,755

	December 31, 2016
	Level 1		Level 2		Level 3		Total
Assets:
Investment securities available-for-sale:
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	—	$	227,160	$	—	$	227,160
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		—		652,739		—		652,739
Municipal securities		—		3,648		—		3,648
Interest rate swap derivatives		—		11,428		—		11,428
Mortgage banking derivatives		—		—		287		287
Total assets at fair value	$	—	$	894,975	$	287	$	895,262
Liabilities:
Interest rate swap derivatives	$	—	$	3,279	$	—	$	3,279
Mortgage banking derivatives		—		—		26		26
Total liabilities at fair value	$	—	$	3,279	$	26	$	3,305

The table below details the changes in level 3 financial instruments during the six months ended June 30, 2017 and June 30, 2016:

		Mortgage banking
		derivatives, net
Balance at December 31, 2016	$	261
Loss included in earnings, net		(130)
Balance at June 30, 2017	$	131

Fair Value of Financial Instruments Measured on a Non-recurring Basis

Certain assets may be recorded at fair value on a non-recurring basis as conditions warrant. These non-recurring fair value measurements typically result from the application of lower of cost or fair value accounting or a write-down occurring during the period.

33

The Company records collateral dependent loans that are considered to be impaired at their estimated fair value. A loan is considered impaired when it is probable that the Company will be unable to collect all contractual amounts due in accordance with the terms of the loan agreement. Collateral dependent impaired loans are measured based on the fair value of the collateral. The Company relies on third-party appraisals and internal assessments in determining the estimated fair values of these loans. The inputs used to determine the fair values of loans are considered level 3 inputs in the fair value hierarchy. At June 30, 2017, the Company measured seven loans not accounted for under ASC 310-30 at fair value on a non-recurring basis, with a carrying balance of $14.5 million and specific reserve balance of $6.2 million. At June 30, 2016, the Company measured six loans with a total carrying balance of $30.1 million and total specific reserves of $14.9 million.

The Company may be required to record fair value adjustments on loans held-for-sale on a non-recurring basis. The non-recurring fair value adjustments could involve lower of cost or fair value accounting and may include write-downs.

OREO is recorded at the lower of the cost basis or the fair value of the collateral less estimated selling costs. The estimated fair values of OREO are updated periodically and further write-downs may be taken to reflect a new basis. The Company recognized $46 thousand and $104 thousand of OREO impairments in its consolidated statements of operations during the six months ended June 30, 2017 and 2016, respectively. The fair values of OREO are derived from third party price opinions or appraisals that generally use an income approach or a market value approach. If reasonable comparable appraisals are not available, then the Company may use internally developed models to determine fair values. The inputs used to determine the fair values of OREO are considered level 3 inputs in the fair value hierarchy.

The table below provides information regarding the assets recorded at fair value on a non-recurring basis during the six months ended June 30, 2017 and 2016:

	June 30, 2017
	Total		Losses from fair value changes
Other real estate owned	$	14,297	$	46
Impaired loans		39,379		327

	June 30, 2016
	Total		Losses from fair value changes
Other real estate owned	$	23,242	$	104
Impaired loans		46,815		4,019

The Company did not record any liabilities for which the fair value was made on a non-recurring basis during the six months ended June 30, 2017.

The following table provides information about the valuation techniques and unobservable inputs used in the valuation of financial instruments classified as level 3 of the fair value hierarchy as of June 30, 2017. The table below excludes non-recurring fair value measurements of collateral value used for impairment measures for OREO and premises and equipment, and other available-for-sale and municipal securities valued at par. The below valuation utilizes third party appraisal or broker price opinions, and is classified as level 3 due to the significant judgment involved:

	Fair value at
	June 30, 2017		Valuation technique	Unobservable input	Qualitative measures
Impaired loans		39,379	Appraised value	Appraised values
				Discount rate	0% - 25%

34

Note 17 Fair Value of Financial Instruments

The fair value of a financial instrument is the amount that would be exchanged between willing parties, other than in a forced liquidation. Fair value is determined based upon quoted market prices to the extent possible; however, in many instances, there are no quoted market prices for the Company’s various financial instruments. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques that may be significantly impacted by the assumptions used, including the discount rate and estimates of future cash flows. Changes in any of these assumptions could significantly affect the fair value estimates. The fair value of the financial instruments listed below does not reflect a premium or discount that could result from offering all of the Company’s holdings of financial instruments at one time, nor does it reflect the underlying value of the Company, as ASC Topic 825 excludes certain financial instruments and all non-financial instruments from its disclosure requirements. The fair value of financial instruments at June 30, 2017 and December 31, 2016, including methods and assumptions utilized for determining fair value of financial instruments, are set forth below:

	Level in fair value	June 30, 2017				December 31, 2016
	measurement	Carrying		Estimated		Carrying		Estimated
	hierarchy	amount		fair value		amount		fair value
ASSETS
Cash and cash equivalents	Level 1	$	129,827	$	129,827	$	152,736	$	152,736
Mortgage-backed securities—residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises available-for-sale	Level 2		195,341		195,341		227,160		227,160
Mortgage-backed securities—other residential mortgage-backed securities issued or guaranteed by U.S. Government agencies or sponsored enterprises available-for-sale	Level 2		668,631		668,631		652,739		652,739
Municipal securities	Level 2		2,058		2,058		3,648		3,648
Municipal securities	Level 3		265		265		265		265
Other available-for-sale securities	Level 3		419		419		419		419
Mortgage-backed securities—residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises held-to-maturity	Level 2		233,026		234,194		263,411		264,862
Mortgage-backed securities—other residential mortgage-backed securities issued or guaranteed by U.S. Government agencies or sponsored enterprises held-to-maturity	Level 2		61,865		60,675		69,094		67,711
Non-marketable securities	Level 2		18,468		18,468		14,949		14,949
Loans receivable	Level 3		3,087,945		3,096,298		2,860,921		2,879,860
Loans held-for-sale	Level 2		7,067		7,067		24,187		24,187
Accrued interest receivable	Level 2		13,294		13,294		12,562		12,562
Interest rate swap derivatives	Level 2		10,694		10,694		11,428		11,428
Mortgage banking derivatives	Level 3		157		157		287		287
LIABILITIES
Deposit transaction accounts	Level 2		2,730,976		2,730,976		2,696,603		2,696,603
Time deposits	Level 2		1,126,481		1,126,481		1,172,046		1,172,046
Securities sold under agreements to repurchase	Level 2		119,213		119,213		92,011		92,011
Federal Home Loan Bank advances	Level 2		129,115		130,642		38,665		39,324
Accrued interest payable	Level 2		5,098		5,098		4,973		4,973
Interest rate swap derivatives	Level 2		4,729		4,729		3,279		3,279
Mortgage banking derivatives	Level 3		26		26		187		187

Cash and cash equivalents

Cash and cash equivalents have a short-term nature and the estimated fair value is equal to the carrying value.

Investment securities

The estimated fair value of investment securities is based on quoted market prices or bid quotations received from securities dealers. Other investment securities, including securities that are held for regulatory purposes are carried at cost, less any other- than-temporary impairment.

35

Loans receivable

The estimated fair value of the loan portfolio is estimated using a discounted cash flow analysis using a discount rate based on interest rates offered at the respective measurement dates for loans with similar terms to borrowers of similar credit quality. The allowance for loan losses is considered a reasonable estimate of any required adjustment to fair value to reflect the impact of credit risk. The estimates of fair value do not incorporate the exit-price concept prescribed by ASC Topic 820, Fair Value Measurements and Disclosures.

Loans held-for-sale

Loans held-for-sale are carried at the lower of aggregate cost or estimated fair value. The portfolio consists primarily of fixed rate residential mortgage loans that are sold within 45 days. The estimated fair value is based on quoted market prices for similar loans in the secondary market and is classified as level 2.

Accrued interest receivable

Accrued interest receivable has a short-term nature and the estimated fair value is equal to the carrying value.

Deposits

The estimated fair value of deposits with no stated maturity, such as non-interest bearing demand deposits, savings, NOW accounts, and money market accounts, is equal to the amount payable on demand. The fair value of interest-bearing time deposits is based on the discounted value of contractual cash flows of such deposits, taking into account the option for early withdrawal. The discount rate is estimated using the rates offered by the Company, at the respective measurement dates, for deposits of similar remaining maturities. The fair value of time deposits has a floor equal to the carrying value as the amount payable on demand would approximate the carrying value.

Derivative assets and liabilities

Fair values for derivative assets and liabilities are fully described in note 16 of the consolidated financial statements.

Securities sold under agreements to repurchase

The vast majority of the Company’s repurchase agreements are overnight transactions that mature the day after the transaction, and as a result of this short-term nature, the estimated fair value is equal to the carrying value.

Accrued interest payable

Accrued interest payable has a short-term nature and the estimated fair value is equal to the carrying value.

36

Item 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

The following management's discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes as of and for the three and six months ended June 30, 2017, and with our annual report on Form 10-K (file number 001-35654), which includes our audited consolidated financial statements and related notes as of and for the years ended December 31, 2016, 2015, and 2014. This discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions that may cause actual results to differ materially from management's expectations. Factors that could cause such differences are discussed in the section entitled “Cautionary Note Regarding Forward-Looking Statements” located elsewhere in this quarterly report and in Item 1A“Risk Factors” in the annual report on Form 10-K, referenced above, and should be read herewith.

On December 31, 2015, our bank subsidiary converted to a Colorado state-chartered bank and changed its name from NBH Bank, N.A. to NBH Bank. All references to NBH Bank should be considered synonymous with references to NBH Bank, N.A. prior to the conversion and name change.

All amounts are in thousands, except share data, or as otherwise noted.

Overview

Our focus is on building strong banking relationships with small to medium-sized businesses and consumers, while maintaining a low risk profile designed to generate reliable income streams and attractive returns. We have established a solid financial services franchise with a sizable presence for deposit gathering and building client relationships necessary for growth. We believe that our established presence in core markets that are outperforming national averages positions us well for growth opportunities. As of June 30, 2017, we had $4.7 billion in assets, $3.1 billion in loans, $3.9 billion in deposits and $0.5 billion in equity.

Operating Highlights and Key Challenges

Our operations resulted in the following highlights as of and for the six months ended June 30, 2017 (except as noted):

Strategic execution

	Net income was $17.5 million, or $0.63 per diluted share, compared to net income of $4.8 million, or $0.16 per diluted share, for the same period in the prior year. The return on average tangible assets was 0.84% compared to 0.28% for the same period in the prior year. The return on average tangible common equity was 7.93% compared to 2.36% for the same period in the prior year.
	Originated loan outstandings totaled $2.8 billion and increased $259.3 million, or 20.4% annualized, since December 31, 2016.
	Maintained a conservatively structured loan portfolio represented by diverse industries and concentrations with most industry sector concentrations at 5% or less of total loans and all concentration levels remain well below our self-imposed limits.
	Capital ratios in excess of federal bank regulatory agency “well capitalized” thresholds.
	Completed divestiture of four banking centers during the second quarter of 2017, resulting in a gain of $2.9 million included in other non-interest income.
	Announced the acquisition of Peoples, Inc. which is expected to add $865 million in assets, $483 million of loans held for investment and $719 million of deposits as of March 31, 2017, as well as a complementary franchise-centric retail mortgage business, which originates over $1.0 billion of mortgage loans per year. The transaction is expected to close in the fourth quarter of 2017.

Loan portfolio

	Total loans ended the quarter at $3.1 billion and increased $227.0 million, or 16.0% annualized, since December 31, 2016, driven by new loan originations of $466.2 million. Total loans at June 30, 2017 increased $349.4 million, or 12.8% since June 30, 2016, on the strength of $1.0 billion in loan originations.
	Non 310-30 loans increased $238.5 million, or 17.7% annualized, led by total commercial loans increasing 28.9% annualized, since December 31, 2016.

37

 Successfully exited $11.4 million, or 15.8% annualized, of the remaining acquired 310-30 loan portfolio, since December 31, 2016.

Non 310-30 credit quality

	Credit quality remained stable, as 90 days past due and non-accruing loans were 1.11% of total loans at June 30, 2017 compared to 1.13% at December 31, 2016. Non-performing assets to total loans and OREO totaled 1.51% at June 30, 2017 compared to 1.61% at December 31, 2016.
	Annualized net charge-offs on non 310-30 loans totaled 0.00% of average non 310-30 loans, compared to 0.34% for the same period in the prior year, or 0.06% excluding the energy portfolio.
	Provision for loan losses totaled $5.9 million compared to $17.9 million in the same period in the prior year, a decrease of $12.0 million driven by an energy sector provision of $15.1 million during the first six months of 2016.

Client deposit funded balance sheet

	Total deposits averaged $3.9 billion and increased $27.8 million from the same period in the prior year, adjusting for the banking center divestitures.
	Demand deposits averaged $833.2 million and grew $38.2 million, or 4.8%, compared to the same period in the prior year, adjusting for the banking center divestitures.
	Higher-cost average time deposits decreased $20.0 million, compared to the same period in the prior year.
	The mix of transaction deposits to total deposits improved to 70.8% from 69.1% at June 30, 2016.
	The average cost of deposits totaled 0.40% increasing from 0.35% in the prior year primarily due to higher cost of time deposits.
	Repurchase agreements averaged $81.7 million, decreasing $28.6 million compared to the same period in the prior year, due to temporary client funds from one client in the prior year.

Revenues

	Fully taxable equivalent (FTE) net interest income totaled $74.3 million and decreased $0.5 million, from the same period in the prior year, due to lower average cash balances and high yielding 310-30 loans, partially offset by a 0.02% increase in the FTE net interest margin from 3.47% to 3.49%.
	The FTE net interest margin widened from 3.47% to 3.49% from June 30, 2016 due to a 0.09% increase in the yield on earning assets, benefiting from higher yields on our variable rate loans, primarily from the short-term market rate increases, and partially offset by lower levels of high yielding 310-30 loans.
	Non-interest income totaled $20.7 million, increasing $2.2 million from the same period in the prior year, driven by a $2.9 million gain from banking center divestitures during the second quarter of 2017 and a $1.1 million increase in swap related income due to interest rate movements. In addition, the prior year included a $1.8 million gain on sale of a building.
	Service charges and bank card fees increased a combined $0.4 million, or 3.1% from the same period in the prior year, due to higher treasury management fees and higher interchange activity. Gain on sale of mortgages decreased $0.4 million due to lower volumes.

Expenses

	Non-interest expense totaled $68.0 million, representing a decrease of $0.2 million from the same period in the prior year.
	Problem asset workout expenses and gain on sale of OREO increased a combined $0.1 million from the same period in the prior year.
	Income tax expense totaled $0.9 million, including a benefit of $3.4 million due to tax benefits from stock compensation activity. Without this $3.4 million benefit, tax expense would have been $4.3 million, an effective tax rate of 23.5%.

Strong capital position

	Capital ratios are strong as our capital position remains well in excess of federal bank regulatory thresholds. As of June 30, 2017, our consolidated tier 1 leverage ratio was 10.3% and our consolidated tier 1 risk-based capital and common equity tier 1 risk-based capital ratios were both 13.3%.
	At June 30, 2017, common book value per share was $20.33, while tangible common book value per share was $18.32.

38

 Since early 2013, we have repurchased 26.6 million shares, or 50.9% of then outstanding shares, at an attractive weighted average price of $20.03 per share.

Key Challenges

There are a number of significant challenges confronting us and our industry. In our short history, we have acquired distressed financial institutions, and sought to rebuild them and implement operational efficiencies across the enterprise as a whole. We face continual challenges implementing our business strategy, including growing the assets and deposits of our business amidst intense competition, particularly for loans and deposits, low interest rates, changes in the regulatory environment and identifying and consummating disciplined merger and acquisition opportunities in a very competitive environment.

General economic conditions continued to improve in the second quarter of 2017. Residential real estate values have largely recovered from their lows and commercial real estate property fundamentals continued to improve in our markets and nationally across all property types and classes. A significant portion of our loan portfolio is secured by real estate and any deterioration in real estate values or credit quality or elevated levels of non-performing assets would ultimately have a negative impact on the quality of our loan portfolio.

Oil and gas prices began a steep decline in November 2014 and have remained volatile through the second quarter of 2017. While there have been job losses related to the Energy sector, employment rates and job creation have trended favorably as other industry sectors have offset declines in Energy.  Nevertheless, the direct impact on the Energy sector has been profound and we have experienced credit deterioration and credit losses in our Energy loan portfolio. Energy loans comprised 3.2% of our total loans at June 30, 2017 and prolonged or further pricing pressure on oil and gas could lead to additional credit stress in our energy portfolio.

The agriculture industry is in the third year of depressed commodity prices. Our agriculture portfolio is only 4.3% of total loans and is well-diversified across crop and livestock types. We have maintained prudent client selectivity, leading to agriculture clients possessing low leverage and, correspondingly, low bank debt to assets, minimizing any potential credit losses in the future.

Our originated loan portfolio at June 30, 2017 totaled $2.8 billion, representing an increase of $259.3 million, or 20.4% annualized compared to December 31, 2016, due to $466.2 million in loan originations, partially offset by loan paydowns and payoffs during the six months ended June 30, 2017. Our acquired loans have produced higher yields than our originated loans, due to accretion of fair value adjustments. During the six months ended June 30, 2017, our weighted average rate on loan originations at the time of origination was 4.00% (fully taxable equivalent), compared to the six months ended June 30, 2017 weighted average yield of our total loan portfolio of 4.71% (fully taxable equivalent). Downward pressure on the yields of our total loan portfolio will continue to the extent that our originated loan portfolio does not provide sufficient yields to replace the high yields on the acquired loan portfolio as they pay down or pay off. Fully taxable equivalent net interest income reached an inflection point in the second quarter of 2017 as the yields and volumes of originated loans outpaced the decrease in higher yielding acquired loan balances. The inflection point was driven by both the strong new loan originations as well as the short-term market rate increases in 2017. Future growth in our interest income will ultimately be dependent on our ability to continue to generate sufficient volumes of high-quality originated loans.    

Continued regulation, impending new liquidity and capital constraints, and a continual need to bolster cybersecurity are adding costs and uncertainty to all U.S. banks and could affect profitability. Also, nontraditional participants in the market may offer increased competition as non-bank payment businesses are expanding into traditional banking products. While certain external factors are out of our control and may provide obstacles to our business strategy, we believe that we are prepared to deal with these challenges. We seek to remain flexible, yet methodical and proactive, in our strategic decision making so that we can quickly respond to market changes and the inherent challenges and opportunities that accompany such changes.

Performance Overview

In evaluating the consolidated statements of financial condition and results of operations financial statement line items, we evaluate and manage our performance based on key earnings indicators, balance sheet ratios, asset quality metrics and regulatory capital ratios, among others. The table below presents some of the primary performance indicators that we use to analyze our business on a regular basis for the periods indicated:

39

	As of and for the three months ended					As of and for the six months ended
	June 30,	December 31,		June 30,		June 30,		June 30,
	2017	2016		2016		2017		2016
Key Ratios(1)
Return on average assets	0.79%	0.87%		0.38%		0.76%		0.20%
Return on average tangible assets(2)	0.87%	0.95%		0.45%		0.84%		0.28%
Return on average tangible assets before provision for loan losses and taxes FTE(2)	1.58%	1.21%		1.22%		1.30%		1.20%
Return on average equity	6.78%	7.31%		3.01%		6.50%		1.57%
Return on average tangible common equity(2)	8.21%	8.87%		3.98%		7.93%		2.36%
Interest earning assets to interest bearing liabilities (end of period)(3)	134.02%	133.44%		135.31%		134.02%		135.31%
Loans to deposits ratio (end of period)	80.23%	74.58%		72.30%		80.23%		72.30%
Non-interest bearing deposits to total deposits (end of period)	22.58%	21.89%		21.89%		22.58%		21.89%
Net interest margin(4)	3.42%	3.37%		3.17%		3.37%		3.37%
Net interest margin FTE(2)(4)	3.55%	3.46%		3.26%		3.49%		3.47%
Interest rate spread(5)	3.41%	3.34%		3.15%		3.36%		3.35%
Yield on earning assets(3)	3.84%	3.73%		3.50%		3.77%		3.71%
Yield on earning assets FTE(2)(3)	3.96%	3.83%		3.60%		3.89%		3.80%
Cost of interest bearing liabilities(3)	0.55%	0.49%		0.45%		0.53%		0.45%
Cost of deposits	0.40%	0.38%		0.36%		0.40%		0.35%
Non-interest expense to average assets	2.87%	2.98%		2.80%		2.96%		2.91%
Efficiency ratio FTE(2)(6)	63.83%	70.62%		69.00%		68.80%		70.23%
Asset Quality Data(7)(8)(9)
Non-performing loans to total loans	1.05%	1.07%		1.37%		1.05%		1.37%
Non-performing assets to total loans and OREO	1.51%	1.61%		2.23%		1.51%		2.23%
Allowance for loan losses to total loans	1.13%	1.02%		1.46%		1.13%		1.46%
Allowance for loan losses to non-performing loans	107.72%	94.98%		107.16%		107.72%		107.16%
Net charge-offs (recoveries) to average loans(1)	(0.01)%	0.02%		0.55%		0.00%		0.32%

(1)	Ratios are annualized.
(2)	Ratio represents non-GAAP financial measure. See non-GAAP reconciliation below.
(3)	Interest earning assets include assets that earn interest/accretion or dividends which is not part of interest earning assets. Any market value adjustments on investment securities are excluded from interest-earning assets. Interest bearing liabilities include liabilities that must be paid interest.
(4)	Net interest margin represents net interest income, including accretion income on interest earning assets, as a percentage of average interest earning assets.
(5)	Interest rate spread represents the difference between the weighted average yield on interest earning assets and the weighted average cost of interest bearing liabilities.
(6)	The efficiency ratio represents non-interest expense, less intangible asset amortization, as a percentage of net interest income on a FTE basis plus non-interest income and is considered a non-GAAP ratio.
(7)	Non-performing loans consist of non-accruing loans and restructured loans on non-accrual, but exclude any loans accounted for under ASC 310-30 in which the pool is still performing. These ratios may, therefore, not be comparable to similar ratios of our peers.
(8)	Non-performing assets include non-performing loans, other real estate owned and other repossessed assets.
(9)	Total loans are net of unearned discounts and fees.

40

About Non-GAAP Financial Measures

Certain of the financial measures and ratios we present, including “tangible assets,” “return on average tangible assets,” “return on average tangible assets before provision for loan losses and taxes,” “return on average tangible common equity,” “tangible common book value,” “tangible common book value per share,” “tangible common equity,” "tangible common equity to tangible assets," and "fully taxable equivalent (FTE)" metrics are supplemental measures that are not required by, or are not presented in accordance with, U.S. generally accepted accounting principles (GAAP). We refer to these financial measures and ratios as “non-GAAP financial measures.” We consider the use of select non-GAAP financial measures and ratios to be useful for financial and operational decision making and useful in evaluating period-to-period comparisons. We believe that these non-GAAP financial measures provide meaningful supplemental information regarding our performance by excluding certain expenditures or assets that we believe are not indicative of our primary business operating results or by presenting certain metrics on a FTE basis. We believe that management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting, analyzing and comparing past, present and future periods.

These non-GAAP financial measures should not be considered a substitute for financial information presented in accordance with GAAP and you should not rely on non-GAAP financial measures alone as measures of our performance. The non-GAAP financial measures we present may differ from non-GAAP financial measures used by our peers or other companies. We compensate for these limitations by providing the equivalent GAAP measures whenever we present the non-GAAP financial measures and by including a reconciliation of the impact of the components adjusted for in the non-GAAP financial measure so that both measures and the individual components may be considered when analyzing our performance.

A reconciliation of our GAAP financial measures to the comparable non-GAAP financial measures is as follows.

Tangible Common Book Value Ratios

	June 30,		December 31,		June 30,
	2017		2016		2016
Total shareholders’ equity	$	544,487	$	536,189	$	598,910
Less: goodwill and intangible assets, net		(63,840)		(66,580)		(69,320)
Add: deferred tax liability related to goodwill		10,098		9,323		8,547
Tangible common equity (non-GAAP)	$	490,745	$	478,932	$	538,137
Total assets	$	4,692,769	$	4,573,046	$	4,627,820
Less: goodwill and intangible assets, net		(63,840)		(66,580)		(69,320)
Add: deferred tax liability related to goodwill		10,098		9,323		8,547
Tangible assets (non-GAAP)	$	4,639,027	$	4,515,789	$	4,567,047
Tangible common equity to tangible assets calculations:
Total shareholders' equity to total assets		11.60%		11.72%		12.95%
Less: impact of goodwill and intangible assets, net		(1.02)%		(1.11)%		(1.17)%
Tangible common equity to tangible assets (non-GAAP)		10.58%		10.61%		11.78%
Tangible common book value per share calculations:
Tangible common equity (non-GAAP)	$	490,745	$	478,932	$	538,137
Divided by: ending shares outstanding		26,788,833		26,386,583		28,810,883
Tangible common book value per share (non-GAAP)	$	18.32	$	18.15	$	18.68
Tangible common book value per share, excluding accumulated other comprehensive income calculations:
Tangible common equity (non-GAAP)	$	490,745	$	478,932	$	538,137
Less: accumulated other comprehensive loss (income), net of tax		1,196		1,762		(11,278)
Tangible common book value, excluding accumulated other comprehensive income, net of tax (non-GAAP)		491,941		480,694		526,859
Divided by: ending shares outstanding		26,788,833		26,386,583		28,810,883
Tangible common book value per share, excluding accumulated other comprehensive income, net of tax (non-GAAP)	$	18.36	$	18.22	$	18.29

41

Return on Average Tangible Assets and Return on Average Tangible Equity

	As of and for the three months ended						As of and for the six months ended
	June 30,		December 31,		June 30,		June 30,		June 30,
	2017		2016		2016		2017		2016
Net income	$	9,209	$	9,989	$	4,504	$	17,467	$	4,755
Add: impact of core deposit intangible amortization expense, after tax		836		836		836		1,671		1,671
Net income adjusted for impact of core deposit intangible amortization expense, after tax	$	10,045	$	10,825	$	5,340	$	19,138	$	6,426
Income before income taxes FTE (non-GAAP)	$	12,773	$	11,098	$	6,523	$	21,060	$	7,939
Add: impact of core deposit intangible amortization expense, before tax		1,370		1,370		1,370		2,740		2,740
Add: provision for loan losses		4,025		1,282		6,457		5,820		17,076
FTE income adjusted for impact of core deposit intangible amortization expense and provision (non-GAAP)	$	18,168	$	13,750	$	14,350	$	29,620	$	27,755
Average assets	$	4,675,614	$	4,592,228	$	4,783,298	$	4,641,432	$	4,708,049
Less: average goodwill and intangible assets, net of deferred tax asset related to goodwill		(54,420)		(57,932)		(61,445)		(55,102)		(62,130)
Average tangible assets (non-GAAP)	$	4,621,194	$	4,534,296	$	4,721,853	$	4,586,330	$	4,645,919
Average shareholders' equity	$	545,167	$	543,421	$	601,142	$	541,563	$	608,676
Less: average goodwill and intangible assets, net of deferred tax asset related to goodwill		(54,420)		(57,932)		(61,445)		(55,102)		(62,130)
Average tangible common equity (non-GAAP)	$	490,747	$	485,489	$	539,697	$	486,461	$	546,546
Return on average assets		0.79%		0.87%		0.38%		0.76%		0.20%
Return on average tangible assets (non-GAAP)		0.87%		0.95%		0.45%		0.84%		0.28%
Return on average tangible assets before provision for loan losses and taxes FTE (non-GAAP)		1.58%		1.21%		1.22%		1.30%		1.20%
Return on average equity		6.78%		7.31%		3.01%		6.50%		1.57%
Return on average tangible common equity (non-GAAP)		8.21%		8.87%		3.98%		7.93%		2.36%

Fully Taxable Equivalent Yield on Earning Assets and Net Interest Margin

	As of and for the three months ended						As of and for the six months ended
	June 30,		December 31,		June 30,		June 30,		June 30,
	2017		2016		2016		2017		2016
Interest income	$	41,332	$	39,658	$	38,472	$	80,072	$	80,026
Add: impact of taxable equivalent adjustment		1,389		1,028		1,037		2,658		2,013
Interest income FTE (non-GAAP)	$	42,721	$	40,686	$	39,509	$	82,730	$	82,039
Net interest income	$	36,892	$	35,785	$	34,753	$	71,614	$	72,791
Add: impact of taxable equivalent adjustment		1,389		1,028		1,037		2,658		2,013
Net interest income FTE (non-GAAP)	$	38,281	$	36,813	$	35,790	$	74,272	$	74,804
Average earning assets	$	4,322,149	$	4,230,177	$	4,415,813	$	4,285,522	$	4,338,519
Yield on earning assets		3.84%		3.73%		3.50%		3.77%		3.71%
Yield on earning assets FTE (non-GAAP)		3.96%		3.83%		3.60%		3.89%		3.80%
Net interest margin		3.42%		3.37%		3.17%		3.37%		3.37%
Net interest margin FTE (non-GAAP)		3.55%		3.46%		3.26%		3.49%		3.47%

Application of Critical Accounting Policies

We use accounting principles and methods that conform to GAAP and general banking practices. We are required to apply significant judgment and make material estimates in the preparation of our financial statements and with regard to various accounting, reporting and disclosure matters. Assumptions and estimates are required to apply these principles where actual measurement is not possible or practical. The most significant of these estimates relate to the accounting for acquired loans and the determination of the ALL. These

42

critical accounting policies and estimates are summarized in the sections captioned “Application of Critical Accounting Policies” in Management's Discussion and Analysis in our 2016 Annual Report on Form 10-K, and are further analyzed with other significant accounting policies in note 2, “Summary of Significant Accounting Policies” in the notes to our consolidated financial statements for the year ended December 31, 2016.

Financial Condition

Total assets increased to $4.7 billion at June 30, 2017 from $4.6 billion at December 31, 2016. During the six months ended June 30, 2017, the decrease from the investment securities portfolio and acquired 310-30 loans was used to fund new loan growth. Total loans were $3.1 billion at June 30, 2017, and grew $227.0 million, or 16.0% annualized, from December 31, 2016. Originated loan outstandings totaled $2.8 billion and increased $107.7 million, or 20.4% annualized. The acquired 310-30 loan portfolio declined $11.4 million, or 7.8%, from December 31, 2016, as a result of the continued successful workout efforts that have been made on our existing acquired problem loans. OREO decreased $1.4 million as we continue to resolve problem assets. During the six months ended June 30, 2017, lower cost demand, savings, and money market ("transaction") deposits were consistent with prior year, after completion of the four banking center divestitures during the second quarter of 2017, while time deposits decreased $45.6 million, or 3.9%, as we continued to focus on developing a long-term banking relationship with clients. 

Investment Securities

Available-for-sale

Total investment securities available-for-sale were $0.9 billion at June 30, 2017 and December 31, 2016. During the six months ended June 30, 2017, maturities and pay downs of available-for-sale securities totaled $115.3 million, and purchases of available-for-sale securities totaled $96.9 million. Our available-for-sale investment securities portfolio is summarized as follows for the periods indicated:

	June 30, 2017						December 31, 2016
						Weighted						Weighted
	Amortized		Fair		Percent of	average	Amortized		Fair		Percent of	average
	cost		value		portfolio	yield	cost		value		portfolio	yield
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	192,369	$	195,341	22.5%	2.29%	$	223,781	$	227,160	25.8%	2.31%
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		680,040		668,631	77.2%	1.79%		666,616		652,739	73.8%	1.71%
Municipal securities		2,323		2,323	0.3%	3.40%		3,921		3,914	0.4%	3.34%
Other securities		419		419	0.0%	0.00%		419		419	0.0%	0.00%
Total investment securities available-for-sale	$	875,151	$	866,714	100.0%	1.90%	$	894,737	$	884,232	100.0%	1.86%

As of June 30, 2017 and December 31, 2016, generally the entire available-for-sale investment portfolio was backed by mortgages. The residential mortgage pass-through securities portfolio is comprised of both fixed rate and adjustable rate Federal Home Loan Mortgage Corporation (“FHLMC”), Federal National Mortgage Association (“FNMA”) and Government National Mortgage Association (“GNMA”) securities. The other mortgage-backed securities are comprised of securities backed by FHLMC, FNMA and GNMA securities.

At June 30, 2017 and December 31, 2016, adjustable rate securities comprised 6.0% and 6.7%, respectively, of the available-for-sale MBS portfolio. The remainder of the portfolio was comprised of fixed rate amortizing securities with 10 to 30 year contractual maturities, with a weighted average coupon of 2.07% per annum and 1.97% per annum at June 30, 2017 and December 31, 2016, respectively.

The available-for-sale investment portfolio included $13.5 million and $16.5 million of gross unrealized losses at June 30, 2017 and December 31, 2016, respectively, which were partially offset by $5.1 million and $6.0 million of gross unrealized gains, respectively. In addition to the U.S. Government agency or sponsored enterprise backings of our MBS portfolio, we believe any unrecognized losses are a result of prevailing interest rates, and as such, we do not believe that any of the securities with unrealized losses were other-than-temporarily-impaired.

43

Held-to-maturity

At June 30, 2017, we held $294.9 million of held-to-maturity investment securities, compared to $332.5 million at December 31, 2016, a decrease of $37.6 million, or 11.3%. During the six months ended June 30, 2017, maturities and pay downs of held-to-maturity securities totaled $36.2 million, while there were no purchases of held-to-maturity securities. Held-to-maturity investment securities are summarized as follows as of the date indicated:

	June 30, 2017						December 31, 2016
						Weighted						Weighted
	Amortized		Fair		Percent of	average	Amortized		Fair		Percent of	average
	cost		value		portfolio	yield	cost		value		portfolio	yield
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	233,026	$	234,194	79.0%	3.23%	$	263,411	$	264,862	79.2%	3.24%
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		61,865		60,675	21.0%	1.66%		69,094		67,711	20.8%	1.68%
Total investment securities held-to-maturity	$	294,891	$	294,869	100.0%	2.90%	$	332,505	$	332,573	100.0%	2.91%

The residential mortgage pass-through and other residential MBS held-to-maturity investment portfolios are comprised of fixed rate FHLMC, FNMA and GNMA securities.

The fair value of the held-to-maturity investment portfolio was $294.9 million and $332.6 million, at June 30, 2017 and December 31, 2016, respectively, and included $0.1 million of net unrealized gains at December 31, 2016.

Loans Overview

At June 30, 2017, our loan portfolio was comprised of new loans that we have originated and loans that were acquired in connection with our five acquisitions to date.

As discussed in note 4 to our consolidated financial statements, in accordance with applicable accounting guidance, all acquired loans are recorded at fair value at the date of acquisition, and an allowance for loan losses is not carried over with the loans but, rather, the fair value of the loans encompasses both credit quality and contractual interest rate considerations. Loans that exhibit signs of credit deterioration at the date of acquisition are accounted for in accordance with the provisions of ASC 310-30. Management accounted for all loans acquired in the Hillcrest Bank, Bank of Choice and Community Banks of Colorado acquisitions under ASC 310-30, with the exception of loans with revolving privileges, which were outside the scope of ASC 310-30. In our Bank Midwest transaction, we did not acquire all of the loans of the former Bank Midwest but, rather, selected certain loans based upon specific criteria of performance, adequacy of collateral, and loan type that were performing at the time of acquisition. As a result, none of the loans acquired in the Bank Midwest transaction are accounted for under ASC 310-30. None of the loans acquired in the Pine River transaction are accounted for under ASC 310-30.

44

The table below shows the loan portfolio composition and the breakout of the portfolio between ASC 310-30 loans and non 310-30 loans at the respective dates:

					June 30, 2017 vs
					December 31, 2016
	June 30, 2017		December 31, 2016		% Change
Loans excluded from ASC 310-30:
Commercial:
Commercial and industrial	$	1,275,855	$	1,074,696	18.7%
Owner occupied commercial real estate		233,930		221,544	5.6%
Agriculture		131,398		134,637	(2.4)%
Energy		98,293		90,273	8.9%
Total commercial		1,739,476		1,521,150	14.4%
Commercial real estate non-owner occupied		473,235		437,642	8.1%
Residential real estate		714,499		728,361	(1.9)%
Consumer		26,308		27,916	(5.8)%
Total loans excluded from ASC 310-30		2,953,518		2,715,069	8.8%
Loans accounted for under ASC 310-30:
Commercial		35,978		39,280	(8.4)%
Commercial real estate non-owner occupied		83,785		89,150	(6.0)%
Residential real estate		14,012		16,524	(15.2)%
Consumer		652		898	(27.4)%
Total loans accounted for under ASC 310-30		134,427		145,852	(7.8)%
Total loans	$	3,087,945	$	2,860,921	7.9%

Our loan portfolio totaled $3.1 billion at June 30, 2017, representing an increase of $227.0 million, or 16.0%, annualized, from December 31, 2016, driven by new loan originations of $466.2 million during the six months ended June 30, 2017. Non 310-30 loans increased $238.4 million, or 17.7% annualized, led by total commercial loans increasing 28.9% annualized. Originated loans outstanding totaled $2.8 billion and increased $259.3 million, or 20.4%, annualized, from December 31, 2016. The acquired 310-30 loan portfolio declined $11.4 million, or 15.8% annualized, from December 31, 2016, as a result of the continued successful workout efforts that have been made on exiting acquired problem loans. At December 31, 2016, $14.4 million of non 310-30 loans were held-for-sale, most of which were in the residential real estate segment. The sale of these loans was completed in connection with the four banking center divestitures in the second quarter of 2017.

We have successfully generated new relationships with small to medium-sized businesses and consumer, experiencing particularly strong loan growth in our commercial portfolio, which at June 30, 2017, was comprised of diverse industry segments. Included in our commercial loans are energy-related loans that comprised 20.8% of the Company’s risk based capital and 3.2% of total loans. The average balance per client in the energy sector was $4.1 million at June 30, 2017. Energy midstream (loans to companies that engage in consolidation, storage, and transportation of oil and gas), energy production (loans to companies engaged in exploration and production), and energy services (loans to companies that provide products and services to oil/gas companies), made up 45.8%, 41.0%, and 13.2%, respectively, of the total energy related portfolio at June 30, 2017. Unfunded commitments to energy clients totaled $97.8 million at June 30, 2017, including $65.2 million to production clients, $27.0 million to midstream clients and $5.5 million to services clients. We may not be contractually required to fund certain amounts depending on the individual circumstances of each client. Energy prices continued to be volatile through the second quarter of 2017, which may result in continued stress on our energy clients and the credit quality of our energy loan portfolio.

Loans in the midstream subsector totaled $45.0 million, with an average balance per client of $9.0 million. One midstream client rated doubtful at June 30, 2017 was placed on non-accrual during the first quarter of 2016 and remained on non-accrual with a loan balance of $2.9 million at June 30, 2017. Loans in the production subsector totaled $40.3 million of the energy loan balances at June 30, 2017, with an average balance per client of $3.4 million. One production client rated substandard at June 30, 2017 was placed on non-accrual during the first quarter of 2016 and remained on non-accrual with a loan balance of $6.6 million at June 30, 2017. Loans in the services subsector totaled $13.0 million with an average balance per client of $1.8 million. One energy services client rated substandard at June 30, 2017 was placed on non-accrual during the third quarter of 2016 and remained on non-accrual with a loan balance of $2.6 million at June 30, 2017.

At June 30, 2017, our non-owner occupied commercial real estate loans were 104% of the Company’s risk based capital, or 17.1%, of total loans, and no specific property type comprised more than 3.5% of total loans. Multi-family loans totaled $41.4 million, or 1.3%

45

of total loans as of June 30, 2017. Agriculture loans were 28% of the Company’s risk based capital and 4.3% of total loans, and are well-diversified across crop and livestock types.

New loan origination is a direct result of our ability to recruit and retain top banking talent, connect with clients in our markets and provide needed services at competitive rates. Loan originations totaled $1.0 billion over the past twelve months. Originations are defined as closed end funded loans and revolving lines of credit advances, net of any current period paydowns. Management utilizes this more conservative definition of originations to better approximate the impact of originations on loans outstanding and ultimately net interest income. The following table represents new loan originations for the last five quarters:

	Second quarter		First quarter		Fourth quarter		Third quarter		Second quarter
	2017		2017		2016		2016		2016
Commercial:
Commercial and industrial	$	159,340	$	114,414	$	109,670	$	92,433	$	142,179
Owner occupied commercial real estate		6,899		16,988		18,606		19,091		17,883
Agriculture		16,696		(3,644)		18,480		9,589		18,072
Energy		9,120		(81)		4,433		(1,251)		(17,328)
Total commercial		192,055		127,677		151,189		119,862		160,806
Commercial real estate non-owner occupied		47,312		36,962		30,227		54,456		89,109
Residential real estate		26,979		29,616		89,968		102,703		63,815
Consumer		3,233		2,378		3,566		4,995		3,158
Total	$	269,579	$	196,633	$	274,950	$	282,016	$	316,888

The tables below show the contractual maturities of our loans for the dates indicated:

	June 30, 2017
	Due within		Due after 1 but		Due after
	1 year		within 5 years		5 years		Total
Commercial:
Commercial and industrial	$	82,827	$	523,224	$	678,652	$	1,284,703
Owner occupied commercial real estate		19,439		84,298		148,499		252,236
Agriculture		14,801		94,231		31,190		140,222
Energy		16,794		81,499		—		98,293
Total commercial		133,861		783,252		858,341		1,775,454
Commercial real estate non-owner occupied		122,010		299,149		135,861		557,020
Residential real estate		6,907		34,721		686,883		728,511
Consumer		5,672		16,412		4,876		26,960
Total loans	$	268,450	$	1,133,534	$	1,685,961	$	3,087,945

	December 31, 2016
	Due within		Due after 1 but		Due after
	1 year		within 5 years		5 years		Total
Commercial:
Commercial and industrial	$	68,485	$	455,444	$	559,421	$	1,083,350
Owner occupied commercial real estate		18,887		92,739		131,434		243,060
Agriculture		22,146		92,269		29,332		143,747
Energy		18,840		71,433		—		90,273
Total commercial		128,358		711,885		720,187		1,560,430
Commercial real estate non-owner occupied		126,784		279,135		120,873		526,792
Residential real estate		9,554		35,506		699,825		744,885
Consumer		5,529		18,164		5,121		28,814
Total loans	$	270,225	$	1,044,690	$	1,546,006	$	2,860,921

46

The stated interest rate (which excludes the effects of non-refundable loan origination and commitment fees, net of costs and the accretion of fair value marks) of non 310-30 loans with maturities over one year is as follows at the dates indicated:

	June 30, 2017
	Fixed			Variable			Total
			Weighted			Weighted			Weighted
	Balance		average rate	Balance		average rate	Balance		average rate
Commercial
Commercial and industrial(1)	$	642,702	3.29%	$	553,969	4.11%	$	1,196,671	3.67%
Owner occupied commercial real estate		121,601	4.13%		98,475	4.52%		220,076	4.45%
Agriculture		40,768	4.72%		76,822	4.06%		117,590	4.29%
Energy		6,837	0.89%		74,661	3.82%		81,498	3.26%
Total commercial		811,908	3.47%		803,927	4.13%		1,615,835	3.80%
Commercial real estate non-owner occupied		138,685	4.45%		246,676	4.00%		385,361	4.16%
Residential real estate		387,672	3.38%		320,767	3.83%		708,439	3.59%
Consumer		17,382	4.62%		3,306	4.47%		20,688	4.60%
Total loans with > 1 year maturity	$	1,355,647	3.56%	$	1,374,676	4.04%	$	2,730,323	3.80%

	December 31, 2016
	Fixed			Variable			Total
			Weighted			Weighted			Weighted
	Balance		average rate	Balance		average rate	Balance		average rate
Commercial
Commercial and industrial(1)	$	544,464	3.25%	$	464,713	3.80%	$	1,009,177	3.50%
Owner occupied commercial real estate		114,513	4.13%		92,535	4.32%		207,048	4.41%
Agriculture		41,373	4.62%		72,140	3.68%		113,513	4.02%
Energy		7,174	0.93%		64,259	3.60%		71,433	3.05%
Total commercial		707,524	3.46%		693,647	3.84%		1,401,171	3.65%
Commercial real estate non-owner occupied		136,965	4.51%		221,527	3.65%		358,492	3.98%
Residential real estate		402,616	3.37%		316,784	3.73%		719,400	3.53%
Consumer		19,127	4.49%		3,395	4.06%		22,522	4.42%
Total loans with > 1 year maturity	$	1,266,232	3.56%	$	1,235,353	3.78%	$	2,501,585	3.67%

(1) Included in commercial fixed rate loans are loans totaling $372,116 and $313,000 that have been swapped to variables rates at current market pricing at June 30, 2017 and December 31, 2016, respectively. Included in the commercial segment are tax exempt loans totaling $484,564 and $384,641 with a weighted average rate of 3.14% and 3.01% at June 30, 2017 and December 31, 2016, respectively.

Accretable Yield

At June 30, 2017, the accretable yield balance was $55.7 million compared to $60.5 million at December 31, 2016. We re-measure the expected cash flows quarterly for all 26 remaining loan pools accounted for under ASC 310-30 utilizing the same cash flow methodology used at the time of acquisition. This re-measurement resulted in a net $7.2 million and $1.6 million reclassification from non-accretable difference to accretable yield during the six months ended June 30, 2017 and 2016, respectively.

In addition to the accretable yield on loans accounted for under ASC 310-30, the fair value adjustments on loans outside the scope of ASC 310-30 are also accreted to interest income over the life of the loans. Total remaining accretable yield and fair value mark was as follows for the dates indicated:

	June 30, 2017		December 31, 2016
Remaining accretable yield on loans accounted for under ASC 310-30	$	55,663	$	60,476
Remaining accretable fair value mark on loans not accounted for under ASC 310-30		2,563		3,236
Total remaining accretable yield and fair value mark	$	58,226	$	63,712

47

Asset Quality

All of the assets acquired in our acquisitions were marked to fair value at the date of acquisition, and the fair value adjustments to loans included a credit quality component. We utilize traditional credit quality metrics to evaluate the overall credit quality of our loan portfolio; however, our credit quality ratios are somewhat limited in their comparability to industry averages or to other financial institutions because of the percentage of acquired problem loans and given that any asset quality deterioration that existed at the date of acquisition was considered in the original fair value adjustments.

Asset quality is fundamental to our success and remains a strong point, driven by our disciplined adherence to our self-imposed concentration limits across industry sector and real estate property type. Accordingly, for the origination of loans, we have established a credit policy that allows for responsive, yet controlled lending with credit approval requirements that are scaled to loan size. Within the scope of the credit policy, each prospective loan is reviewed in order to determine the appropriateness and the adequacy of the loan characteristics and the security or collateral prior to making a loan. We have established underwriting standards and loan origination procedures that require appropriate documentation, including financial data and credit reports. For loans secured by real property, we require property appraisals, title insurance or a title opinion, hazard insurance and flood insurance, in each case where appropriate.

Additionally, we have implemented procedures to timely identify loans that may become problematic in order to ensure the most beneficial resolution to the Company. Asset quality is monitored by our credit risk management department and evaluated based on quantitative and subjective factors such as the timeliness of contractual payments received. Additional factors that are considered, particularly with commercial loans over $500,000, include the financial condition and liquidity of individual borrowers and guarantors, if any, and the value of our collateral. To facilitate the oversight of asset quality, loans are categorized based on the number of days past due and on an internal risk rating system, and both are discussed in more detail below.

Our internal risk rating system uses a series of grades which reflect our assessment of the credit quality of loans based on an analysis of the borrower's financial condition, liquidity and ability to meet contractual debt service requirements. Loans that are perceived to have acceptable risk are categorized as “Pass” loans. “Special mention” loans represent loans that have potential credit weaknesses that deserve close attention. Special mention loans include borrowers that have potential weaknesses or unwarranted risks that, unless corrected, may threaten the borrower's ability to meet debt service requirements. However, these borrowers are still believed to have the ability to respond to and resolve the financial issues that threaten their financial situation. Loans classified as “Substandard” have a well-defined credit weakness and are inadequately protected by the current paying capacity of the obligor or of the collateral pledged, if any. Although these loans are identified as potential problem loans, they may never become non-performing. Substandard loans have a distinct possibility of loss if the deficiencies are not corrected. “Doubtful” loans are loans that management believes that collection of payments in accordance with the terms of the loan agreement are highly questionable and improbable. Doubtful loans are deemed impaired and put on non-accrual status.

Non 310-30 loan risk ratings at June 30, 2017 are stable-to-improving as criticized and classified assets were consistent with December 31, 2016. Classified assets decreased $12.4 million from December 31, 2016 as substandard rated loans improved $16.2 million while doubtful loans increased $3.8 million. The increase in doubtful loans was due to specific reserves on one commercial loan and one energy loan, both expected to resolve in the back-half of 2017. In addition, classified assets as a percentage of non 310-30 loans improved from 2.3% at December 31, 2016 to 1.7% at June 30, 2017.

In the event of borrower default, we may seek recovery in compliance with state lending laws, the respective loan agreements, and credit monitoring and remediation procedures that may include modifying or restructuring a loan from its original terms, for economic or legal reasons, to provide a concession to the borrower from their original terms due to borrower financial difficulties in order to facilitate repayment. Such restructured loans are considered “troubled debt restructurings” or "TDRs" in accordance with ASC 310-40, Troubled Debt Restructurings by Creditors. Under this guidance, modifications to loans that fall within the scope of ASC 310-30 are not considered troubled debt restructurings, regardless of otherwise meeting the definition of a troubled debt restructuring. Assets that have been foreclosed on or acquired through deed-in-lieu of foreclosure are classified as OREO until sold, and are carried at the lower of the related loan balance or the fair value of the collateral less estimated costs to sell, with any initial valuation adjustments charged to the ALL and any subsequent declines in carrying value charged to impairments on OREO.

Non-performing Assets

Non-performing assets consist of non-accrual loans, troubled debt restructurings on non-accrual, OREO and other repossessed assets.  Non-accrual loans and troubled debt restructurings on non-accrual accounted for under ASC 310-30, as described below, may be

48

excluded from our non-performing assets to the extent that the cash flows of the loan pools are still estimable. Interest income that would have been recorded had non-accrual loans performed in accordance with their original contract terms during the three and six months ended June 30, 2017 and 2016 was $0.5 million and $1.0 million, respectively.

Our acquired non-performing assets were marked to fair value at the time of acquisition, mitigating much of our loss potential on these non-performing assets. As a result, the levels of our non-performing assets are not fully comparable to those of our peers or to industry benchmarks.

All loans accounted for under ASC 310-30 were classified as performing assets at June 30, 2017, as the carrying values of the respective loan or pool of loans cash flows were considered estimable and probable of collection. Therefore, interest income, through accretion of the difference between the carrying value of the loans in the pool and the pool's expected future cash flows, is being recognized on all acquired loans accounted for under ASC 310-30.

The following table sets forth the non-performing assets as of the dates presented:

	June 30, 2017		December 31, 2016
Non-accrual loans:
Commercial:
Commercial and industrial	$	1,013	$	1,160
Owner occupied commercial real estate		4,325		2,054
Agriculture		831		297
Energy		—		6,517
Total commercial		6,169		10,028
Commercial real estate non-owner occupied		35		66
Residential real estate		4,535		3,875
Consumer		35		40
Total non-accrual loans, excluding restructured loans		10,774		14,009
Restructured loans on non-accrual:
Commercial:
Commercial and industrial		6,767		7,527
Owner occupied commercial real estate		52		2
Agriculture		1,377		1,608
Energy		12,050		6,128
Total commercial		20,246		15,265
Commercial real estate non-owner occupied		—		—
Residential real estate		1,308		1,301
Consumer		127		142
Total restructured loans on non-accrual		21,681		16,708
Total non-performing loans		32,455		30,717
OREO		14,297		15,662
Total non-performing assets	$	46,752	$	46,379
Loans 90 days or more past due and still accruing interest	$	215	$	—
Accruing restructured loans	$	5,177	$	5,766
ALL	$	34,959	$	29,174
Total non-performing loans to total loans		1.05%		1.07%
Loans 90 days or more past due and still accruing interest to total loans		0.01%		0.00%
Total non-performing assets to total loans and OREO		1.51%		1.61%
ALL to non-performing loans		107.72%		94.98%

49

During the six months ended June 30, 2017, total non-performing loans increased $1.7 million from December 31, 2016 resulting from one loan relationship totaling $2.2 million in the owner occupied commercial real estate sector placed on non-accrual during the second quarter of 2017, partially offset by other net decreases of $0.5 million. During the six months ended June 30, 2017, accruing TDRs decreased $0.6 million primarily due to decreases in the residential real estate segment totaling $0.5 million. During the six months ended June 30, 2017, $0.6 million of OREO loans were foreclosed or otherwise repossessed and transferred to OREO and $3.7 million of OREO was sold resulting in a net gain of $1.8 million. OREO write-downs of $46 thousand were recorded during the six months ended June 30, 2017.

Total non-performing assets to total loans and OREO was 1.51% and 1.61% at June 30, 2017 and December 31, 2016, respectively. Included in this ratio at June 30, 2017 are acquired non-performing loans and OREO of 0.62% compared to 0.71% at December 31, 2016. Acquired OREO has been a source of income for the Company as net OREO gains totaled $1.8 million and $2.0 million for the six months ended June 30, 2017 and 2016, respectively. In addition, the ratio includes 0.39% and 0.44% of non-performing energy loans at June 30, 2017 and December 31, 2016. At June 30, 2017, 87.7% of the energy portfolio was pass rated, and there were no new energy non-performing assets identified since the first quarter of 2016. The remaining 0.50% of non-performing loans, excluding energy loans to total loans is consistent with the prior period.

Past Due Loans

Past due status is monitored as an indicator of credit deterioration. Loans are considered past due or delinquent when the contractual principal or interest due in accordance with the terms of the loan agreement remains unpaid after the due date of the scheduled payment. Loans that are 90 days or more past due and not accounted for under ASC 310-30 are put on non-accrual status unless the loan is well secured and in the process of collection. The table below shows the past due status of loans not accounted for under ASC 310-30, based on contractual terms of the loans as of June 30, 2017 and December 31, 2016:

	June 30, 2017		December 31, 2016
Loans 30-89 days past due and still accruing interest	$	4,415	$	2,296
Loans 90 days past due and still accruing interest		215		—
Non-accrual loans		32,455		30,717
Total past due and non-accrual loans	$	37,085	$	33,013
Total 90 days past due and still accruing interest and non-accrual loans to total non 310-30 loans		1.11%		1.13%
Total non-accrual loans to total non 310-30 loans		1.10%		1.13%
% of total past due and non-accrual loans that carry fair value marks		11.34%		10.75%

Loans 30-89 days past due and still accruing interest increased by $2.1 million from December 31, 2016 to June 30, 2017, and loans 90 days or more past due and still accruing interest increased $0.2 million from December 31, 2016 to June 30, 2017, for a collective increase in total past due loans of $2.3 million. Non-accrual loans increased $1.7 million at June 30, 2017 compared to December 31, 2016, further described within the Non-Performing Assets discussion of Management’s Discussion and Analysis. There were no ASC 310-30 loan pools past due or on non-accrual at June 30, 2017.

Allowance for Loan Losses

The ALL represents the amount that we believe is necessary to absorb probable losses inherent in the loan portfolio at the balance sheet date and involves a high degree of judgment and complexity. Determination of the ALL is based on an evaluation of the collectability of loans, the realizable value of underlying collateral, economic conditions, historical net loan losses, the estimated loss emergence period, estimated default rates, any declines in cash flow assumptions from acquisition, loan structures, growth factors and other elements that warrant recognition and, to the extent applicable, prior loss experience. The ALL is critical to the portrayal and understanding of our financial condition, liquidity and results of operations. The determination and application of the ALL accounting policy involves judgments, estimates, and uncertainties that are subject to change. Changes in these assumptions, estimates or the conditions surrounding them may have a material impact on our financial condition, liquidity or results of operations.

In accordance with the applicable guidance for business combinations, acquired loans were recorded at their acquisition date fair values, which were based on expected future cash flows and included an estimate for future loan losses; therefore, no ALL was recorded as of the acquisition date. Any estimated losses on acquired loans that arise after the acquisition date are reflected in a charge to the provision for loan losses on the consolidated statements of operations.

50

Loans accounted for under the accounting guidance provided in ASC 310-30 have been grouped into pools based on the predominant risk characteristics of purpose and/or type of loan. The timing and receipt of expected principal, interest and any other cash flows of these loans are periodically remeasured and the expected future cash flows of the collective pools are compared to the carrying value of the pools. To the extent that the expected future cash flows of each pool is less than the book value of the pool, an allowance for loan losses will be established through a charge to the provision for loan losses. If the remeasured expected future cash flows are greater than the book value of the pools, then the improvement in the expected future cash flows is accreted into interest income over the remaining expected life of the loan pool. During the six months ended June 30, 2017 and 2016, these re-measurements resulted in overall increases in expected cash flows in certain loan pools, which, absent previous valuation allowances within the same pool, are reflected in increased accretion as well as an increased amount of accretable yield and are recognized over the expected remaining lives of the underlying loans as an adjustment to yield.

For all loans not accounted for under ASC 310-30, the determination of the ALL follows a process to determine the appropriate level of ALL that is designed to account for changes in credit quality and other risk factors. This process provides an ALL consisting of a specific allowance component based on certain individually evaluated loans and a general allowance component based on estimates of reserves needed for all other loans, segmented based on similar risk characteristics.

Impaired loans less than $250,000 are included in the general allowance population. Impaired loans over $250,000 are subject to individual evaluation on a regular basis to determine the need, if any, to allocate a specific reserve to the impaired loan. Typically, these loans consist of commercial, commercial real estate and agriculture loans and exclude homogeneous loans such as residential real estate and consumer loans. Specific allowances are determined by collectively analyzing:

	the borrower's resources, ability, and willingness to repay in accordance with the terms of the loan agreement;
	the likelihood of receiving financial support from any guarantors;
	the adequacy and present value of future cash flows, less disposal costs, of any collateral;
	the impact current economic conditions may have on the borrower's financial condition and liquidity or the value of the collateral.

In evaluating the loan portfolio for an appropriate ALL level, unimpaired loans are grouped into segments based on broad characteristics such as primary use and underlying collateral. We have identified four primary loan segments that are further stratified into eleven loan classes to provide more granularity in analyzing loss history and to allow for more definitive qualitative adjustments based upon specific factors affecting each loan class. Following are the loan classes within each of the four primary loan segments:

	Non-owner occupied
Commercial	commercial real estate	Residential real estate	Consumer
Commercial and industrial	Construction	Senior lien	Total Consumer
Owner occupied commercial real estate	Acquisition and development	Junior lien
Agriculture	Multifamily
Energy	Non-owner occupied

Appropriate ALL levels are determined by segment and class utilizing risk ratings, loss history, peer loss history and qualitative adjustments. The qualitative adjustments consider the following risk factors:

	economic/external conditions;
	loan administration, loan structure and procedures;
	risk tolerance/experience;
	loan growth;
	trends;
	concentrations; and
	other.

51

Management derives an estimated annual loss rate adjusted for an estimated loss emergence period based on historical loss data categorized by segment and class. The loss rates are applied at the loan segment and class level. Our historical loss history began in 2012, resulting in minimal losses in our originated portfolio. In order to address this lack of historical data, we incorporate not only our own historical loss rates since the beginning of 2012, but we also utilize peer historical loss data, including a historical average net charge-off ratio on each loan type, relying on the Uniform Bank Performance Reports compiled by the Federal Financial Institutions Examinations Council (“FFIEC”). We may also apply a long-term estimated loss rate to pass rated credits as necessary to account for inherent risks to the portfolio. For originated loans, we assign a slightly higher portion of our loss history, but still rely on the peer loss history to account for our limited historical data. For acquired loans, we use solely our internal loss history as those loans are more seasoned and more of the actual losses in the portfolio have been from the acquired portfolio.

The collective resulting ALL for loans not accounted for under ASC 310-30 is calculated as the sum of the specific reserves and the general reserves. While these amounts are calculated by individual loan or segment and class, the entire ALL is available for any loan that, in our judgment, should be charged-off.

Non 310-30 ALL

During the three and six months ended June 30, 2017, we recorded $4.1 million and $5.9 million, respectively, of provision for loan losses for loans not accounted for under ASC 310-30. The three months ended June 30, 2017 provision included specific reserves totaling $2.1 million on one commercial loan and general reserves on net loan growth. The six months ended June 30, 2017 provision included specific reserves totaling $3.4 million on one energy sector and one commercial sector loan. Net recoveries for non ASC 310-30 loans during the three months ended June 30, 2017 totaled $84 thousand. Net charge-offs for non ASC 310-30 loans during the six months ended June 30, 2017 totaled $35 thousand. Specific reserves on impaired loans totaled $6.2 million and $2.4 million at June 30, 2017 and December 31, 2016, respectively.

During the three and six months ended June 30, 2016, we recorded $6.4 million and $17.9 million, respectively, of provision for loan losses for loans not accounted for under ASC 310-30, which primarily reflects specific reserves on certain non-performing loans and reserves to support loan growth. The provision was driven by specific reserves against the energy sector portfolio of $4.3 million, recorded during the three months ended June 30, 2016 and $15.1 million increase in allowance for loan losses on the energy sector for the six months ended June 30, 2016. Net charge-offs for non ASC 310-30 loans during the three months and six months ended June 30, 2016 totaled $3.5 million and $4.0 million, respectively, and were driven by a resolved energy sector loan which was previously reserved. 

310-30 ALL

During the three and six months ended June 30, 2017, loans accounted for under ASC 310-30 had $78 thousand and $83 thousand of recoupment, respectively. The recoupment was due to an improvement of expected future cash flows during the period.

During the three and six months ended June 30, 2016, loans accounted for under ASC 310-30 had $57 thousand of provision and $805 thousand of recoupment, respectively. The recoupment was due to an improvement of expected future cash flows during the period.

Total ALL

After considering the above mentioned factors, we believe that the ALL of $35.0 million and $29.2 million is adequate to cover probable losses inherent in the loan portfolio at June 30, 2017 and December 31, 2016, respectively. However, it is likely that future adjustments to the ALL will be necessary and any changes to the assumptions, circumstances or estimates used in determining the ALL could adversely affect the Company's results of operations, liquidity or financial condition.

The following schedule presents, by class stratification, the changes in the ALL during the three months ended June 30, 2017 and 2016:

52

	June 30, 2017						June 30, 2016
	ASC		Non				ASC		Non
	310-30		310-30				310-30		310-30
	loans		loans		Total		Loans		Loans		Total
Beginning allowance for loan losses	$	220	$	30,630	$	30,850	$	215	$	36,951	$	37,166
Charge-offs:
Commercial		—		—		—		—		(3,375)		(3,375)
Commercial real estate non owner-occupied		—		—		—		(41)		—		(41)
Residential real estate		—		(2)		(2)		—		(140)		(140)
Consumer		—		(119)		(119)		—		(171)		(171)
Total charge-offs		—		(121)		(121)		(41)		(3,686)		(3,727)
Recoveries		—		205		205		—		210		210
Net recoveries (charge-offs)		—		84		84		(41)		(3,476)		(3,517)
(Recoupment) provision for loan loss		(78)		4,103		4,025		57		6,400		6,457
Ending allowance for loan losses	$	142	$	34,817	$	34,959	$	231	$	39,875	$	40,106
Ratio of annualized net charge-offs (recoveries) to average total loans during the period, respectively		0.00%		(0.01)%		(0.01)%		0.09%		0.58%		0.55%
Average total loans outstanding during the period	$	136,662	$	2,865,329	$	3,001,991	$	174,415	$	2,413,375	$	2,587,790

The following schedule presents, by class stratification, the changes in the ALL during the six months ended June 30, 2017 and 2016:

	June 30, 2017						June 30, 2016
	ASC		Non				ASC		Non
	310-30		310-30				310-30		310-30
	loans		loans		Total		loans		loans		Total
Beginning allowance for loan losses	$	225	$	28,949	$	29,174	$	1,077	$	26,042	$	27,119
Charge-offs:
Commercial		—		(20)		(20)		—		(3,484)		(3,484)
Commercial real estate non-owner occupied		—		—		—		(41)		(276)		(317)
Residential real estate		—		(10)		(10)		—		(197)		(197)
Consumer		—		(301)		(301)		—		(388)		(388)
Total charge-offs		—		(331)		(331)		(41)		(4,345)		(4,386)
Recoveries		—		296		296		—		297		297
Net charge-offs		—		(35)		(35)		(41)		(4,048)		(4,089)
(Recoupment) provision for loan loss		(83)		5,903		5,820		(805)		17,881		17,076
Ending allowance for loan losses	$	142	$	34,817	$	34,959	$	231	$	39,875	$	40,106
Ratio of annualized net charge-offs to average total loans during the period, respectively		0.00%		0.00%		0.00%		0.05%		0.34%		0.32%
Ratio of ALL to total loans outstanding at period end, respectively		0.11%		1.18%		1.13%		0.14%		1.55%		1.46%
Ratio of ALL to total non-performing loans at period end, respectively		0.00%		107.28%		107.71%		0.00%		106.54%		107.15%
Total loans	$	134,427	$	2,953,518	$	3,087,945	$	169,282	$	2,569,222	$	2,738,504
Average total loans outstanding during the period	$	139,416	$	2,801,467	$	2,940,883	$	182,524	$	2,401,162	$	2,583,686
Non-performing loans	$	—	$	32,455	$	32,455	$	—	$	37,428	$	37,428

The following table presents the allocation of the ALL and the percentage of the total amount of loans in each loan category listed as of the dates presented:

	June 30, 2017
						ALL as a %
	Total loans		% of total loans	Related ALL		of total ALL
Commercial	$	1,775,454	57.5%	$	24,656	70.5%
Commercial real estate non-owner occupied		557,020	18.0%		5,934	17.0%
Residential real estate		728,511	23.6%		4,067	11.6%
Consumer		26,960	0.9%		302	0.9%
Total	$	3,087,945	100.0%	$	34,959	100.0%

53

	December 31, 2016
						ALL as a %
	Total loans		% of total loans	Related ALL		of total ALL
Commercial	$	1,560,430	54.6%	$	18,821	64.6%
Commercial real estate non-owner occupied		526,792	18.4%		5,642	19.3%
Residential real estate		744,885	26.0%		4,387	15.0%
Consumer		28,814	1.0%		324	1.1%
Total	$	2,860,921	100.0%	$	29,174	100.0%

The ALL allocated to commercial loans increased to 70.5% at June 30, 2017 from 64.6% at December 31, 2016, primarily due to loan growth and a $3.4 increase to specific reserves on one commercial loan and one energy loan. The total allowance for loan losses on the energy sector portfolio was 4.3% at June 30, 2017 compared to 3.9% at December 31, 2016.

Other Assets

Significant components of other assets were as follows as of the periods indicated:

					Increase (decrease)
	June 30, 2017		December 31, 2016		Amount		% Change
Bank-owned life insurance	$	63,457	$	62,516	$	941	1.5%
Deferred tax asset		53,180		52,810		370	0.7%
Derivative asset		10,851		11,715		(864)	(7.4)%
Accrued interest on loans		10,829		10,020		809	8.1%
Accrued income taxes receivable		3,630		5,252		(1,622)	(30.9)%
Accrued interest on interest bearing bank deposits and investment securities		2,465		2,542		(77)	(3.0)%
Other miscellaneous assets		7,946		8,345		(399)	(4.8)%
Minority interest in participated other real estate owned		—		1,578		(1,578)	(100.0)%
Total other assets	$	152,358	$	154,778	$	(2,420)	(1.6)%

Other assets totaled $152.4 million and $154.8 million at June 30, 2017 and December 31, 2016, respectively, representing a decrease of $2.4 million, or 1.6%, during the six months ended June 30, 2017. The decrease was driven by tax benefits from share-based compensation activity within accrued income taxes receivable and the sale of minority interest in other real estate owned.  

Other Liabilities

Significant components of other liabilities were as follows as of the dates indicated:

					Increase (decrease)
	June 30, 2017		December 31, 2016		Amount		% Change
Pending loan purchase settlement	$	7,000	$	5,063	$	1,937	38.3%
Accrued expenses		10,959		13,040		(2,081)	(16.0)%
Accrued interest payable		5,098		4,973		125	2.5%
Derivative liability		4,755		3,466		1,289	37.2%
Other miscellaneous liabilities		14,685		10,990		3,695	33.6%
Total other liabilities	$	42,497	$	37,532	$	4,965	13.2%

Other liabilities totaled $42.5 million and $37.5 million at June 30, 2017 and December 31, 2016, respectively, and increased $5.0 million, or 13.2%, during the six months ended June 30, 2017. The increase was driven by increases in other miscellaneous liabilities, pending loan purchase settlement, and the derivative liability. Other miscellaneous liabilities increased largely due the timing of deposit settlements of $1.7 million and an increase in collateral reserves of $1.4 million. These increases were partially offset by a decrease in accrued expenses largely driven by lower bonus accruals of $1.3 million. Refer to note 14 of our consolidated financial statements for further discussion of the derivative liability.

Deposits and other borrowings

Deposits from banking clients serve as a primary funding source for our banking operations and our ability to gather and manage deposit levels is critical to our success. Deposits not only provide a low cost funding source for our loans, but also provide a

54

foundation for the client relationships that are critical to future loan growth. The following table presents information regarding our deposit composition at June 30, 2017 and December 31, 2016:

							Increase (decrease)
	June 30, 2017			December 31, 2016			Amount		% Change
Non-interest bearing demand deposits	$	870,875	22.6%	$	846,744	21.9%	$	24,131	2.8%
Interest bearing demand deposits		418,729	10.9%		427,538	11.1%		(8,809)	(2.1)%
Savings accounts		437,328	11.3%		376,046	9.7%		61,282	16.3%
Money market accounts		1,004,044	26.0%		1,046,275	27.0%		(42,231)	(4.0)%
Total transaction deposits		2,730,976	70.8%		2,696,603	69.7%		34,373	1.3%
Time deposits < $100,000		655,207	17.0%		704,673	18.2%		(49,466)	(7.0)%
Time deposits > $100,000		471,274	12.2%		467,373	12.1%		3,901	0.8%
Total time deposits		1,126,481	29.2%		1,172,046	30.3%		(45,565)	(3.9)%
Total deposits	$	3,857,457	100.0%	$	3,868,649	100.0%	$	(11,192)	(0.3)%

At December 31, 2016, deposits totaling $103.0 million were held-for-sale, including $51.6 million of time deposits. The sale of these deposits was completed in connection with the four banking center divestitures in the second quarter of 2017.

The following table shows scheduled maturities of certificates of deposit with denominations greater than or equal to $100,000 as of June 30, 2017:

	June 30, 2017
Three months or less	$	71,964
Over 3 months through 6 months		80,130
Over 6 months through 12 months		136,083
Thereafter		183,097
Total time deposits > $100,000	$	471,274

Total deposits decreased $11.2 million during the six months ended June 30, 2017 driven by $93.9 million sold at the completion of our four banking center divestitures, including $48.4 million of time deposits. In addition, money market accounts decreased $42.4 million, from December 31, 2016 driven by $19.0 million sold from the banking center divestitures. These decreases were partially offset by increases in savings accounts of $61.3 million, and demand deposits of $24.1 million, from December 31, 2016. The mix of transaction deposits (defined as total deposits less time deposits) to total deposits improved to 70.8% at June 30, 2017, from 69.7% at December 31, 2016, as we continued to focus on developing long-term banking relationships. At June 30, 2017 and December 31, 2016, time deposits that were scheduled to mature within 12 months totaled $731.5 million and $788.8 million, respectively. Of the $731.5 million in time deposits scheduled to mature within 12 months at June 30, 2017, $288.2 million were in denominations of $100,000 or more, and $443.3 million were in denominations less than $100,000.

As of June 30, 2017 and December 31, 2016, the Company sold securities under agreements to repurchase totaling $119.2 million and $92.0 million, respectively. In addition, as a member of the FHLB, the Bank has access to a line of credit and term financing from the FHLB with total available credit of $763.6 million. At June 30, 2017 and December 31, 2016, the Bank had $129.1 million and $25.0 million in term advances from the FHLB, respectively. The term advances have fixed rates of 1.31% - 2.33%, with maturity dates of 2018 - 2020.

Results of Operations

Our net income depends largely on net interest income, which is the difference between interest income from interest earning assets and interest expense on interest bearing liabilities. Our results of operations are also affected by provisions for loan losses and non-interest income, such as service charges, bank card income, swap fee income, and gain on sale of mortgages, net. Our primary operating expenses, aside from interest expense, consist of salaries and benefits, occupancy costs, telecommunications data processing expense and intangible asset amortization. Any expenses related to the resolution of problem assets are also included in non-interest expense.

55

Overview of Results of Operations

We recorded net income of $9.2 million and $17.5 million, or $0.33 and $0.63 per diluted share, during the three and six months ended June 30, 2017, respectively, compared to net income of $4.5 million and $4.8 million, or $0.15 and $0.16 per diluted share, during the three and six months ended June 30, 2016, respectively. Fully taxable equivalent net interest income totaled $38.3 million and $74.3 million for the three and six months ended June 30, 2017, respectively, and increased $2.5 million and decreased $0.5 million from the three and six months ended June 30, 2016, respectively.  

Provision for loan loss expense on non 310-30 loans was $4.1 million and $5.9 million during the three and six months ended June 30, 2017, respectively, compared to $6.4 million and $17.9 million during the three and six months ended June 30, 2016, respectively, a decrease of $2.3 million and $12.0 million, respectively. The decrease in provision for the three and six months ended June 30, 2017 was driven by energy sector provision of $4.3 million and $15.1 million during the three and six months ended June 30, 2016, respectively.

Non-interest income was $12.0 million and $20.7 million during the three and six months ended June 30, 2017, respectively, compared to $10.5 million and $18.4 million during the three and six months ended June 30, 2016, respectively, an increase of $1.5 million and $2.2 million from the three and six months ended June 30, 2016, respectively. The increase in non-interest income during the three and six months ended June 30, 2017, compared to the prior periods, was driven by a $2.9 million gain from banking center divestitures during the three months ended June 30, 2017. The six months ended June 30, 2017 increase was also driven by a $1.1 million increase in swap related income due to interest rate movements. In addition, prior year included a $1.8 million gain on sale of a building during the three and six months ended 2016.

Non-interest expense totaled $33.4 million and $68.0 million during the three and six months ended June 30, 2017, compared to $33.3 million and $68.2 million during the three and six months ended June 30, 2016, an increase of $0.1 million and a decrease of $0.2 million from the prior periods, respectively.

Net Interest Income

We regularly review net interest income metrics to provide us with indicators of how the various components of net interest income are performing. We regularly review: (i) our loan mix and the yield on loans; (ii) the investment portfolio and the related yields; (iii) our deposit mix and the cost of deposits; and (iv) net interest income simulations for various forecast periods.

The following tables present the components of net interest income for the periods indicated. The tables include: (i) the average daily balances of interest earning assets and interest bearing liabilities; (ii) the average daily balances of non-interest earning assets and non-interest bearing liabilities; (iii) the total amount of interest income earned on interest earning assets on a fully taxable equivalent basis; (iv) the total amount of interest expense incurred on interest bearing liabilities; (v) the resultant average yields and rates; (vi) net interest spread; and (vii) net interest margin, which represents the difference between interest income and interest expense, expressed as a percentage of interest earning assets. The effects of trade-date accounting of investment securities for which the cash had not settled are not considered interest earning assets and are excluded from this presentation for time frames prior to their cash settlement, as are the market value adjustments on the investment securities available-for-sale.

56

The table below presents the components of net interest income on a fully taxable equivalent basis for the three months ended June 30, 2017 and 2016:

	For the three months ended					For the three months ended
	June 30, 2017					June 30, 2016
	Average				Average	Average				Average
	balance		Interest		rate	balance		Interest		rate
Interest earning assets:
ASC 310-30 loans	$	136,662	$	6,180	18.09%	$	174,415	$	7,762	17.80%
Non 310-30 loans FTE(1)(2)(3)(4)(5)		2,872,020		29,620	4.14%		2,421,033		23,348	3.88%
Investment securities available-for-sale		906,738		4,358	1.92%		1,072,976		4,954	1.85%
Investment securities held-to-maturity		305,722		2,131	2.79%		395,027		2,804	2.84%
Other securities		15,657		218	5.57%		14,936		192	5.14%
Interest earning deposits and securities purchased under agreements to resell		85,350		214	1.01%		337,426		449	0.54%
Total interest earning assets FTE(4)	$	4,322,149	$	42,721	3.96%	$	4,415,813	$	39,509	3.60%
Cash and due from banks	$	66,651				$	71,162
Other assets		318,429					333,855
Allowance for loan losses		(31,615)					(37,532)
Total assets	$	4,675,614				$	4,783,298
Interest bearing liabilities:
Interest bearing demand, savings and money market deposits	$	1,871,814	$	1,424	0.31%	$	1,978,438	$	1,317	0.27%
Time deposits		1,147,037		2,479	0.87%		1,180,496		2,199	0.75%
Securities sold under agreements to repurchase		85,022		40	0.19%		113,645		37	0.13%
Federal Home Loan Bank advances		130,795		497	1.52%		40,000		166	1.67%
Total interest bearing liabilities	$	3,234,668	$	4,440	0.55%	$	3,312,579	$	3,719	0.45%
Demand deposits	$	858,299				$	821,987
Other liabilities		37,480					47,590
Total liabilities		4,130,447					4,182,156
Shareholders' equity		545,167					601,142
Total liabilities and shareholders' equity	$	4,675,614				$	4,783,298
Net interest income			$	38,281				$	35,790
Interest rate spread FTE(4)					3.41%					3.15%
Net interest earning assets	$	1,087,481				$	1,103,234
Net interest margin FTE(4)					3.55%					3.26%
Ratio of average interest earning assets to average interest bearing liabilities		133.62%					133.30%

(1)	Originated loans are net of deferred loan fees, less costs, which are included in interest income over the life of the loan.
(2)	Includes originated loans with average balances of $2,739,424 and $2,238,151, interest income of $26,226 and $19,782, with tax equivalent yields of 4.04% and 3.74% for the three months ended June 30, 2017 and 2016, respectively.
(3)	Non 310-30 loans include loans held-for-sale. Average balances during the three months ended June 30, 2017 and 2016 were $6,691 and $7,628, respectively, and interest income was $134 and $117 for the same periods, respectively.
(4)	Presented on a fully taxable equivalent basis using the statutory tax rate of 35%. The taxable equivalent adjustments included above are $1,389 and $1,037 for the three months ended June 30, 2017 and 2016, respectively.
(5)	Loan fees included in interest income totaled $1,098 and $1,014 for the three months ended June 30, 2017 and 2016, respectively.

Net interest income totaled $36.9 million and $34.8 million for the three months ended June 30, 2017 and 2016, respectively. On a fully taxable equivalent basis, net interest income totaled $38.3 million for the three months ended June 30, 2017, increasing $2.5 million, or 7.0%, from the three months ended June 30, 2016 due to an increase in net interest margin from 3.26% to 3.55%. The 0.29% widening of the fully taxable equivalent net interest margin is due to a 0.36% increase in the yield on earnings assets, benefiting from higher yields on our variable rate loans, primarily driven by the short-term market rate increases, partially offset by a 0.10% increase in the cost of interest bearing liabilities.

57

Average loans of $3.0 billion comprised 69.6% of total average interest earning assets during the three months ended June 30, 2017, compared to $2.6 billion, or 58.8%, of total average interest earning assets during the three months ended June 30, 2016. The increase in average loan balances is due to loan originations outpacing the exit of the acquired problem loans. The yield on the ASC 310-30 loan portfolio was 18.09% during the three months ended June 30, 2017, compared to 17.80% during the same period the prior year, increasing as a result of quarterly re-measurements.

Average investment securities comprised 28.1% of total interest earning assets during the three months ended June 30, 2017, compared to 33.2% during the three months ended June 30, 2016. The decrease in the investment portfolio reflects the re-mixing of the interest-earning assets as the runoff of the investment portfolio is used to fund loan originations. Average short-term investments, comprised of interest earning deposits and securities purchased under agreements to resell, decreased to 2.0% of interest earning assets compared to 7.6% during the prior period. This decrease was driven by temporary client funds on deposit from one energy client during the three months ended June 30, 2016.

Average balances of interest bearing liabilities decreased $77.9 million during the three months ended June 30, 2017, compared to the three months ended June 30, 2016, driven by a decrease of $106.6 million in interest bearing demand, saving and money market deposits, a decrease in time deposits of $33.5 million, and a decrease in securities sold under agreements to repurchase of $28.6 million, mostly offset by a $90.8 million increase in Federal Home Loan Bank advances. Adjusting for banking center divestitures, interest bearing demand, saving and money market deposits decreased $80.5 million and time deposits increased $5.3 million. Total interest expense related to interest bearing liabilities was $4.4 million during the three months ended June 30, 2017, compared to $3.7 million during the three months ended June 30, 2016, at an average cost of 0.55% and 0.45%, respectively. Additionally, the average cost of deposits increased four basis points to 0.40% for the three months ended June 30, 2017 from the same period in the prior year, primarily due to higher-cost time deposits.

58

The table below presents the components of net interest income on a fully taxable equivalent basis for the six months ended June 30, 2017 and 2016:

	For the six months ended					For the six months ended
	June 30, 2017					June 30, 2016
	Average				Average	Average				Average
	balance		Interest		rate	balance		Interest		rate
Interest earning assets:
ASC 310-30 loans	$	139,416	$	12,051	17.29%	$	182,537	$	18,056	19.78%
Non 310-30 loans FTE(1)(2)(3)(4)(5)		2,809,844		56,781	4.08%		2,411,145		46,985	3.92%
Investment securities available-for-sale		918,628		8,719	1.90%		1,105,243		10,258	1.86%
Investment securities held-to-maturity		315,015		4,383	2.78%		406,486		5,735	2.82%
Other securities		14,527		385	5.30%		16,870		421	4.99%
Interest earning deposits and securities purchased under agreements to resell		88,092		411	0.94%		216,238		584	0.54%
Total interest earning assets FTE(4)	$	4,285,522	$	82,730	3.89%	$	4,338,519	$	82,039	3.80%
Cash and due from banks	$	66,875				$	71,213
Other assets		319,771					331,335
Allowance for loan losses		(30,736)					(33,018)
Total assets	$	4,641,432				$	4,708,049
Interest bearing liabilities:
Interest bearing demand, savings and money market deposits	$	1,883,969	$	2,791	0.30%	$	1,909,032	$	2,500	0.26%
Time deposits		1,163,338		4,900	0.85%		1,183,311		4,326	0.74%
Securities sold under agreements to repurchase		81,693		73	0.18%		110,253		77	0.14%
Federal Home Loan Bank advances		89,856		694	1.56%		40,000		332	1.67%
Total interest bearing liabilities	$	3,218,856	$	8,458	0.53%	$	3,242,596	$	7,235	0.45%
Demand deposits	$	841,814				$	807,624
Other liabilities		39,199					49,153
Total liabilities		4,099,869					4,099,373
Stockholders' equity		541,563					608,676
Total liabilities and shareholders’ equity	$	4,641,432				$	4,708,049
Net interest income			$	74,272				$	74,804
Interest rate spread FTE(4)					3.36%					3.35%
Net interest earning assets	$	1,066,666				$	1,095,923
Net interest margin FTE(4)					3.49%					3.47%
Ratio of average interest earning assets to average interest bearing liabilities		133.14%					133.80%

(1)	Originated loans are net of deferred loan fees, less costs, which are included in interest income over the life of the loan.
(2)	Includes originated loans with average balances of $2,671,905 and $2,220,518, interest income of $49,944 and $39,611, with tax equivalent yields of 3.97% and 3.77% for the six months ended June 30, 2017 and 2016, respectively.
(3)	Non 310-30 loans include loans held-for-sale. Average balances during the six months ended June 30, 2017 and 2016 were $8,377 and $9,981, respectively, and interest income was $279 and $282 for the same periods, respectively.
(4)	Presented on a fully taxable equivalent basis using the statutory tax rate of 35%. The taxable equivalent adjustments included above are $2,658 and $2,013 for the six months ended June 30, 2017 and 2016, respectively.
(5)	Loan fees included in interest income totaled $1,943 and $2,061 for the six months ended June 30, 2017 and 2016, respectively.

Net interest income totaled $71.6 million and $72.8 million for the six months ended June 30, 2017 and 2016, respectively. On a fully taxable equivalent basis, net interest income totaled $74.3 million for the six months ended June 30, 2017 and decreased $0.5 million from the six months ended June 30, 2016 due to lower average earnings assets, partially offset by a 0.02% increase in the fully taxable equivalent net interest margin from 3.47% to 3.49%. The 0.02% widening of the fully taxable equivalent net interest margin is due to a 0.09% increase in the yield on earnings assets, benefiting from higher yields on our variable rate loans, primarily from the short-term market rate increases, and partially offset by lower levels of high-yielding 310-30 loans. These increases were partially offset by the 0.08% increase in the cost of interest bearing liabilities.

59

Average loans comprised $2.9 billion, or 68.8%, of total average interest earning assets during the six months ended June 30, 2017, compared to $2.6 billion, or 59.8%, of total average interest earning assets during the six months ended June 30, 2016. The increase in average loan balances is reflective of loan originations outpacing the exit of the acquired problem loans. The yield on the ASC 310-30 loan portfolio was 17.29% during the six months ended June 30, 2017, compared to 19.78% during the same period the prior year. This decrease was primarily due to $1.0 million of accelerated accretion income during the six months ended 2016.

Average investment securities comprised 28.8% of total interest earning assets during the six months ended June 30, 2017, compared to 34.8% during the six months ended June 30, 2016. The decrease in the investment portfolio reflects the re-mixing of the interest-earning assets as the runoff of the investment portfolio is used to fund loan originations. Short-term investments, comprised of interest earning deposits and securities purchased under agreements to resell, decreased to 2.1% of interest earning assets compared to 5.0% during the prior period, primarily driven by temporary client funds on deposit from one energy client during the six months ended June 30, 2016.

Average balances of interest bearing liabilities decreased $23.7 million during the six months ended June 30, 2017, compared to the six months ended June 30, 2016, driven by a $28.6 million decrease in securities sold under agreements to repurchase, a $25.1 million decrease in interest bearing demand, saving and money market deposits, and a $20.0 million decrease in time deposits. Adjusting for banking center divestitures, interest bearing demand, savings and money market deposits decreased $11.7 million and time deposits increased $1.2 million. These decreases were mostly offset by an increase of $49.9 million in Federal Home Loan Bank advances. Total interest expense related to interest bearing liabilities was $8.5 million during the six months ended June 30, 2017, compared to $7.2 million during the six months ended June 30, 2016, at an average cost of 0.53% and 0.45%, respectively. Additionally, the average cost of deposits increased five basis points to 0.40% for the six months ended June 30, 2017 from the same period in the prior year, primarily due to higher cost time deposits.

60

The following table summarizes the changes in net interest income on a fully taxable equivalent basis by major category of interest earning assets and interest bearing liabilities, identifying changes related to volume and changes related to rates for the three and six months ended June 30, 2017 compared to the three and six months ended June 30, 2016:

	Three months ended  June 30, 2017						Six months ended June 30, 2017
	compared to						compared to
	Three months ended  June 30, 2016						Six months ended June 30, 2016
	Increase (decrease) due to						Increase (decrease) due to
	Volume		Rate		Net		Volume		Rate		Net
Interest income:
ASC 310-30 loans	$	(1,707)	$	125	$	(1,582)	$	(3,727)	$	(2,278)	$	(6,005)
Non 310-30 loans FTE(1)(2)(3)		4,651		1,621		6,272		8,057		1,739		9,796
Investment securities available-for-sale		(799)		203		(596)		(1,771)		232		(1,539)
Investment securities held-to-maturity		(622)		(51)		(673)		(1,273)		(79)		(1,352)
Other securities		10		16		26		(62)		26		(36)
Interest earning deposits and securities purchased under agreements to resell		(632)		397		(235)		(598)		425		(173)
Total interest income	$	901	$	2,311	$	3,212	$	626	$	65	$	691
Interest expense:
Interest bearing demand, savings and money market deposits	$	(81)	$	188	$	107	$	(37)	$	328	$	291
Time deposits		(72)		352		280		(84)		658		574
Securities sold under agreements to repurchase		345		(14)		331		385		(23)		362
Federal Home Loan Bank advances		(13)		16		3		(26)		22		(4)
Total interest expense		179		542		721		238		985		1,223
Net change in net interest income	$	722	$	1,769	$	2,491	$	388	$	(920)	$	(532)

(1)	Originated loans are net of deferred loan fees, less costs, which are included in interest income over the life of the loan.
(2)	Non 310-30 loans include loans held-for-sale. Average balances during the three months ended June 30, 2017 and 2016 were $6,691 and $7,628, respectively, and interest income was $134 and $117 for the same periods, respectively. Average balances during the six months ended June 30, 2017 and 2016 were $8,377 and $9,981, respectively, and interest income was $279 and 282 for the same periods, respectively.
(3)	Presented on a fully taxable equivalent basis using the statutory tax rate of 35%. The taxable equivalent adjustments included above are $1,389 and $1,037 for three months ended June 30, 2017 and 2016, respectively. The taxable equivalent adjustments included above are $2,658 and $2,013 for six months ended June 30, 2017 and 2016, respectively.

Below is a breakdown of deposits and the average rates paid during the periods indicated:

	For the three months ended
	June 30, 2017			March 31, 2017			December 31, 2016			September 30, 2016			June 30, 2016
			Average			Average			Average			Average			Average
	Average		rate	Average		rate	Average		rate	Average		rate	Average		rate
	balance		paid	balance		paid	balance		paid	balance		paid	balance		paid
Non-interest bearing demand	$	858,299	0.00%	$	825,146	0.00%	$	835,263	0.00%	$	824,848	0.00%	$	821,987	0.00%
Interest bearing demand		415,498	0.10%		422,500	0.09%		415,948	0.09%		413,446	0.09%		420,253	0.09%
Money market accounts		1,029,480	0.38%		1,084,669	0.38%		1,057,908	0.36%		1,001,658	0.33%		1,169,238	0.33%
Savings accounts		426,836	0.32%		389,090	0.26%		370,845	0.27%		383,981	0.28%		388,947	0.27%
Time deposits		1,147,037	0.87%		1,179,821	0.83%		1,169,325	0.80%		1,174,269	0.78%		1,180,496	0.75%
Total average deposits	$	3,877,150	0.40%	$	3,901,226	0.39%	$	3,849,289	0.38%	$	3,798,202	0.36%	$	3,980,921	0.36%

61

Provision for Loan Losses

The provision for loan losses represents the amount of expense that is necessary to bring the ALL to a level that we deem appropriate to absorb probable losses inherent in the loan portfolio as of the balance sheet date. The ALL is in addition to the remaining purchase accounting marks of $2.6 million on acquired non 310-30 loans that were established at the time of acquisition. The determination of the ALL, and the resultant provision for loan losses, is subjective and involves significant estimates and assumptions. Below is a summary of the provision for loan losses recorded in the consolidated statements of operations for the periods indicated:

	For the three months ended June 30,				For the six months ended June 30,
	2017		2016		2017		2016
(Recoupment) provision for impairment loans accounted for under ASC 310-30	$	(78)	$	57	$	(83)	$	(805)
Provision for loan losses		4,103		6,400		5,903		17,881
Total provision for loan losses	$	4,025	$	6,457	$	5,820	$	17,076

Provision for loan losses was $4.0 million and $5.8 million during the three and six months ended June 30, 2017, respectively, compared to $6.5 million and $17.1 million during the three and six months ended June 30, 2016, respectively. The provision for loan losses on non 310-30 loans decreased $2.3 million during the three months ended June 30, 2017, compared to the same period in the prior year, due to $4.0 million higher energy sector provision recorded during the three months ended June 30, 2016, partially offset by a $2.1 million increase in specific reserves on one commercial loan, recorded during the three months ended June 30, 2017. The non 310-30 allowance for loan losses was 1.18% of total non 310-30 loans compared to 1.55% at June 30, 2016. Annualized net recoveries on non 310-30 loans totaled 0.01% for the three months ended June 30, 2017 compared to annualized net charge-offs of 0.58% for the three months ended June 30, 2016. The decrease in annualized net charge-offs on non 310-30 loans was driven by charge-offs on energy sector loans during the three months ended June 30, 2016 of $3.4 million.

The year-over-year provision for loan losses on non 310-30 loans decreased $12.0 million driven by energy sector provision of $15.1 million during the six months ended June 30, 2016. Annualized net charge-offs on non 310-30 loans totaled 0.00% for the six months of 2017 compared to 0.34% for the six months of 2016, or 0.06% excluding the energy sector portfolio.

For the three and six months ended June 30, 2017, we recorded a recoupment of $78 thousand and $83 thousand, respectively, of provision for loan losses accounted for under ASC 310-30 in connection with our re-measurements of expected cash flows. For the three and six months ended June 30, 2016, we recorded provision of $57 thousand and recoupment of $805 thousand, respectively, for loan losses accounted for under ASC 310-30 in connection with our re-measurements of expected cash flow. The decreases in expected future cash flows are reflected immediately in our financial statements through increased provisions for loan losses. Increases in expected future cash flows are reflected through an increase in accretable yield that is accreted to income in future periods once any previously recorded provision expense has been reversed.

Non-Interest Income

The table below details the component of non-interest income for the periods presented:

	For the three months ended June 30,				For the six months ended June 30,				Three months			Six months
									Increase (decrease)			Increase (decrease)
	2017		2016		2017		2016		Amount		% Change	Amount		% Change
Service charges	$	3,546	$	3,465	$	6,872	$	6,725	$	81	2.3%	$	147	2.2%
Bank card fees		3,134		2,935		5,938		5,702		199	6.8%		236	4.1%
Gain on sale of mortgages, net		594		958		1,048		1,432		(364)	(38.0)%		(384)	(26.8)%
Bank-owned life insurance income		472		486		942		881		(14)	(2.9)%		61	6.9%
Other non-interest income		4,124		2,473		5,538		3,164		1,651	66.8%		2,374	75.0%
OREO related income		86		187		314		523		(101)	(54.0)%		(209)	(40.0)%
Total non-interest income	$	11,956	$	10,504	$	20,652	$	18,427	$	1,452	13.8%	$	2,225	12.1%

62

Non-interest income for the three and six months ended June 30, 2017 was $12.0 million and $20.7 million, respectively, compared to $10.5 million and $18.4 million during the three and six months ended June 30, 2016, respectively. The increase in non-interest income during the three and six months ended June 30, 2017 compared to the prior periods was driven by a $2.9 million gain from banking center divestitures during the three months ended June 30, 2017, included in other non-interest income. In addition, the prior period included a $1.8 million gain on sale of a building, included in other non-interest income. The six months ended June 30, 2017 increase also included a $1.1 million increase in swap related income due to interest rate movements, included in other non-interest income.

Service charges, which represent various fees charged to clients for banking services, including fees such as non-sufficient funds (“NSF”) charges and service charges on deposit accounts increased $0.1 million during the three and six months ended June 30, 2017, respectively, compared to the prior periods, due to higher treasury management fees.

Bank card fees grew during the three and six months ended June 30, 2017 due to higher interchange activity. Gain on sale of mortgages decreased during the three and six months ended June 30, 2017 due to lower volumes.

OREO related income includes rental income and insurance proceeds received on OREO properties and write-ups to the fair value of collateral that exceed the loan balance at the time of foreclosure. During the three and six months ended June 30, 2017, this income decreased $0.1 million and $0.2 million, respectively, compared to prior periods.

Non-Interest Expense

The table below details the components of non-interest expense for the periods presented:

	For the three months ended June 30,				For the six months ended June 30,				Three months			Six months
									Increase (decrease)			Increase (decrease)
	2017		2016		2017		2016		Amount		% Change	Amount		% Change
Salaries and benefits	$	19,909	$	19,612	$	40,299	$	40,224	$	297	1.5%	$	75	0.2%
Occupancy and equipment		5,242		5,708		10,679		11,774		(466)	(8.2)%		(1,095)	(9.3)%
Telecommunications and data processing		1,552		1,471		3,139		3,112		81	5.5%		27	0.9%
Marketing and business development		545		689		1,196		1,115		(144)	(20.9)%		81	7.3%
FDIC deposit insurance		686		1,064		1,391		1,985		(378)	(35.5)%		(594)	(29.9)%
Bank card expenses		896		963		1,779		1,876		(67)	(7.0)%		(97)	(5.2)%
Professional fees		1,270		978		1,686		1,434		292	29.9%		252	17.6%
Other non-interest expense		2,733		2,112		5,139		4,067		621	29.4%		1,072	26.4%
Problem asset workout		880		958		1,752		1,932		(78)	(8.1)%		(180)	(9.3)%
Gain on OREO sales, net		(1,644)		(1,611)		(1,756)		(2,043)		(33)	(2.0)%		287	(14.0)%
Intangible asset amortization		1,370		1,370		2,740		2,740		—	0.0%		—	0.0%
Total non-interest expense	$	33,439	$	33,314	$	68,044	$	68,216	$	125	0.4%	$	(172)	(0.3)%

Non-interest expense totaled $33.4 million and $68.0 million for the three and six months ended June 30, 2017, compared to $33.3 million and $68.2 million for the three and six months ended June 30, 2016. Occupancy and equipment decreased $0.5 million and $1.1 million during the three and six months ended June 30, 2017, compared to prior periods, due to lower utilities and maintenance expense and lower depreciation expense. Professional fees increased $0.3 million during the three and six months ended June 30, 2017, compared to prior periods, due to acquisition-related expenses. Other non-interest expense increased during the three and six months ended June 30, 2017, compared to prior periods, due to various expense categories. Problem asset workout expense and gain on sale of OREO decreased a combined $0.1 million during the three months ended June 30, 2017 and increased a combined $0.1 million during the six months ended June 30, 2017, compared to prior periods.

Income taxes

Income tax expense totaled $2.2 million and $1.0 million for the three and six months ended June 30, 2017, respectively, compared to an expense of $1.0 million and $1.2 million for the three and six months ended June 30, 2016, respectively. The tax expense recorded for the three and six months ended June 30, 2017 was lowered by a $0.5 million and $3.4 million tax benefit from stock compensation activity, respectively. Without the discrete items related to stock compensation activity, the tax rates for the three and six months ended June 30, 2017 were consistent period-to-period. The quarterly effective tax rate differs from the federal statutory rate primarily due to tax benefits from stock compensation activity, interest income from tax-exempt lending, bank-owned life insurance income, and the relationship of these items to pre-tax income. The Company forecasts the full year estimated effective tax rate in accordance with ASC 740; as a result, the relationship between pre-tax income and tax-exempt income within each reporting period can create fluctuations in the effective tax rate from period-to-period.

63

Certain of the Company’s outstanding stock-based compensation awards have market-based vesting/exercisability criteria. For restricted stock with market-based vesting, the target share price of the Company's stock that is required for vesting is $34.00 per share. The strike prices for options range from $18.09 - $34.04, with a large portion of the awards having strike prices of $20.00. Depending on the movement in our stock price, these stock-based compensation awards may create either an excess tax benefit or tax deficiency depending on the relationship between the fair value at the time of vesting or exercise and the estimated fair value recorded at the time of grant. The Company adopted ASU 2016-09 effective January 1, 2016, which results in recording the excess tax benefit or tax deficiency as a tax benefit or expense in the consolidated statements of operations. As of June 30, 2017, the Company had $5.0 million of deferred tax assets related to stock-based compensation, $3.4 million of which is associated with executive officers still employed by the Company.

Additional information regarding income taxes can be found in note 21 of our audited consolidated financial statements in our 2016 Annual Report on Form 10-K and note 13 of this document.

Liquidity and Capital Resources

Liquidity is monitored and managed to ensure that sufficient funds are available to operate our business and pay our obligations to depositors and other creditors, while providing ample available funds for opportunistic and strategic investments. On-balance sheet liquidity is represented by our cash and cash equivalents, and unencumbered investment securities, and is detailed in the table below as of June 30, 2017 and December 31, 2016:

	June 30, 2017		December 31, 2016
Cash and due from banks	$	129,827	$	152,736
Unencumbered investment securities, at fair value		725,933		843,061
Total	$	855,760	$	995,797

Total on-balance sheet liquidity decreased $140.0 million at June 30, 2017 compared to December 31, 2016. The decrease was driven by a reduction of $117.1 million in unencumbered available-for-sale and held-to-maturity securities balances and a reduction of $22.9 million in cash and due from banks.

Our primary sources of funds are deposits, securities sold under agreements to repurchase, prepayments and maturities of loans and investment securities, the sale of investment securities, and funds provided from operations. We are also a party to a master repurchase agreement with a large financial institution and we anticipate that, through this agreement, we would have access to a significant amount of liquidity. We anticipate having access to other third party funding sources, including the ability to raise funds through the issuance of shares of our common stock or other equity or equity-related securities, incurrence of debt, and federal funds purchased, that may also be a source of liquidity. We anticipate that these sources of liquidity will provide adequate funding and liquidity for at least a 12 month period.

Our primary uses of funds are loan originations, investment security purchases, withdrawals of deposits, settlement of repurchase agreements, capital expenditures, operating expenses, and share repurchases. For additional information regarding our operating, investing, and financing cash flows, see our consolidated statements of cash flows in the accompanying unaudited consolidated financial statements.

Exclusive from the investing activities related to acquisitions, our primary investing activities are originations and pay-offs and pay downs of loans and purchases and sales of investment securities. At June 30, 2017, pledgeable investment securities represented our largest source of liquidity. Our available-for-sale investment securities are carried at fair value and our held-to-maturity securities are carried at amortized cost. Our collective investment securities portfolio totaled $1.2 billion at June 30, 2017, inclusive of pre-tax net unrealized losses of $8.4 million on the available-for-sale securities portfolio. Additionally, our held-to-maturity securities portfolio had $22 thousand of pre-tax net unrealized losses at June 30, 2017. The gross unrealized gains and losses are detailed in note 3 of our consolidated financial statements. As of June 30, 2017, our investment securities portfolio consisted primarily of mortgage-backed securities, all of which were issued or guaranteed by U.S. Government agencies or sponsored enterprises. The anticipated repayments and marketability of these securities offer substantial resources and flexibility to meet new loan demand, reinvest in the investment securities portfolio, or provide optionality for reductions in our deposit funding base.

At present, financing activities primarily consist of changes in deposits and repurchase agreements, and advances from FHLB, in addition to the payment of dividends and the repurchase of our common stock. Maturing time deposits represent a potential use of

64

funds. As of June 30, 2017, $731.5 million of time deposits were scheduled to mature within 12 months. Based on the current interest rate environment, market conditions, and our consumer banking strategy focusing on both lower cost transaction accounts and term deposits, our strategy is to replace a significant portion of those maturing time deposits with transaction deposits and market-rate time deposits.

Through our relationship with the FHLB, we have pledged qualifying loans and investment securities allowing us to obtain additional liquidity through FHLB advances and lines of credit. FHLB advances and lines of credit available totaled $892.7 million of which $129.1 million was used at June 30, 2017. We can obtain additional liquidity through FHLB advances if required. The bank also has access to federal funds lines of credit with corresponding banks.

The new Basel III rules, effective January 1, 2015, changed the components of regulatory capital and changed the way in which risk ratings are assigned to various categories of bank assets. Also, a new Tier I common risk-based ratio was defined. Under the Basel III requirements, at June 30, 2017, the Company met all capital adequacy requirements and had regulatory capital ratios in excess of the levels established for well-capitalized institutions. For more information on regulatory capital, see note 8 in our consolidated financial statements.

Our shareholders' equity is impacted by the retention of earnings, changes in unrealized gains and losses on securities, net of tax, stock-based compensation activity, share repurchases and the payment of dividends.

The Board of Directors has authorized multiple programs to repurchase shares of the Company’s common stock from time to time either in open market or in privately negotiated transactions in accordance with applicable regulations of the SEC. We believe that our repurchases could serve to offset any future share issuances for future acquisitions. During the six month ended June 30, 2017, we did not repurchase any shares of our common stock.

On August 5, 2016, the Company announced that its Board of Directors authorized a program to repurchase up to an additional $50.0 million of the Company’s common stock. The remaining authorization under this program as of June 30, 2017 was $12.6 million.

On August 2, 2017, our Board of Directors declared a quarterly dividend of $0.09 per common share, payable on September 15, 2017 to shareholders of record at the close of business on August 25, 2017.

Asset/Liability Management and Interest Rate Risk

Management and the Board of Directors are responsible for managing interest rate risk and employing risk management policies that monitor and limit this exposure. Interest rate risk is measured using net interest income simulations and market value of portfolio equity analyses. These analyses use various assumptions, including the nature and timing of interest rate changes, yield curve shape, prepayments on loans and securities, deposit decay rates, pricing decisions on loans and deposits, and reinvestment/replacement of asset and liability cash flows.

The principal objective of the Company's asset and liability management function is to evaluate the interest rate risk within the balance sheet and pursue a controlled assumption of interest rate risk while maximizing earnings and preserving adequate levels of liquidity and capital. The asset and liability management function is under the guidance of the Asset Liability Committee from direction of the Board of Directors. The Asset Liability Committee meets monthly to review, among other things, the sensitivity of the Company's assets and liabilities to interest rate changes, local and national market conditions and rates. The Asset Liability Committee also reviews the liquidity, capital, deposit mix, loan mix and investment positions of the Company.

Instantaneous parallel rate shift scenarios are modeled and utilized to evaluate risk and establish exposure limits for acceptable changes in net interest margin. These scenarios, known as rate shocks, simulate an instantaneous change in interest rates and use various assumptions, including, but not limited to, prepayments on loans and securities, deposit decay rates, pricing decisions on loans and deposits, reinvestment and replacement of asset and liability cash flows.

We also analyze the economic value of equity as a secondary measure of interest rate risk. This is a complementary measure to net interest income where the calculated value is the result of the market value of assets less the market value of liabilities. The economic value of equity is a longer term view of interest rate risk because it measures the present value of the future cash flows. The impact of changes in interest rates on this calculation is analyzed for the risk to our future earnings and is used in conjunction with the analyses on net interest income.

65

Our interest rate risk model indicated that the Company was asset sensitive in terms of interest rate sensitivity at June 30, 2017. During the six months ended June 30, 2017, we increased our asset sensitivity as a result of the balance sheet mix towards more variable rate loans, even after adjusting our models for the excess capital deployment. The table below illustrates the impact of an immediate and sustained 200 and 100 basis point increase and a 50 basis point decrease in interest rates on net interest income based on the interest rate risk model at June 30, 2017 and December 31, 2016:  

Hypothetical
shift in interest	% change in projected net interest income
rates (in bps)	June 30, 2017	December 31, 2016
200	6.74%	5.84%
100	4.22%	3.66%
(50)	(2.39)%	(2.49)%

Many assumptions are used to calculate the impact of interest rate fluctuations. Actual results may be significantly different than our projections due to several factors, including the timing and frequency of rate changes, market conditions and the shape of the yield curve. The computations of interest rate risk shown above do not include actions that management may undertake to manage the risks in response to anticipated changes in interest rates and actual results may also differ due to any actions taken in response to the changing rates.

As part of the asset/liability management strategy to manage primary market risk exposures expected to be in effect in future reporting periods, management has emphasized the origination of shorter duration loans as well as variable rate loans to limit the negative exposure to a rate increase. The strategy with respect to liabilities has been to emphasize transaction accounts, particularly non-interest or low interest bearing non-maturing deposit accounts which are less sensitive to changes in interest rates. In response to this strategy, non-maturing deposit accounts have grown $34.4 million during the six months June 30, 2017, and totaled 70.8% of total deposits at June 30, 2017 compared to 69.7% at December 31, 2016. We currently have no brokered time deposits and intend to continue to focus on our strategy of increasing non-interest or low-cost interest bearing non-maturing deposit accounts.

Off-Balance Sheet Activities

In the normal course of business, we are a party to various contractual obligations, commitments and other off-balance sheet activities that contain credit, market, and operational risk that are not required to be reflected in our consolidated financial statements. The most significant of these are the loan commitments that we enter into to meet the financing needs of clients, including commitments to extend credit, commercial and consumer lines of credit and standby letters of credit. As of June 30, 2017 and December 31, 2016, we had loan commitments totaling $648.2 million and $602.2 million, respectively, and standby letters of credit that totaled $15.0 million and $13.5 million, respectively. Unused commitments do not necessarily represent future credit exposure or cash requirements, as commitments often expire without being drawn upon. We do not anticipate any material losses arising from commitments or contingent liabilities and we do not believe that there are any material commitments to extend credit that represent risks of an unusual nature. 

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The information called for by this item is provided under the caption Asset/Liability Management and Interest Rate Risk in Part I, Item 2-Management's Discussion and Analysis of Financial Condition and Results of Operations and is incorporated herein by reference.

Item 4. CONTROLS AND PROCEDURES

Our management, with the participation of our principal executive officer and principal financial officer, conducted an evaluation of the effectiveness of our disclosure controls and procedures, as such term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as of June 30, 2017. Based on this evaluation, our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were effective as of June 30, 2017.

During the most recently completed fiscal quarter, there were no changes made in the Company's internal controls over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.

66

PART II: OTHER INFORMATION

Item 1. LEGAL PROCEEDINGS

From time to time, we are a party to various litigation matters incidental to the conduct of our business. We are not presently party to any legal proceedings the resolution of which we believe would have a material adverse effect on our business, prospects, financial condition, liquidity, results of operation, cash flows or capital levels.

Item 1A. RISK FACTORS

There have been no material changes to the risk factors disclosed in Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2016.

Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

					Maximum number
				Total number of	(or approximate dollar
				shares (or units)	value) of shares (or
	Total number	Average		purchased as part of	units) that may yet be
	of shares (or	price paid per		publicly announced	purchased under the
Period	units) purchased	share (or unit)		plans or programs	plans or programs (2)
April 1 - April 30, 2017(1)	34,541	$	31.57	—	$	12,562,825
May 1 - May 31, 2017(1)	25,585		31.76	—		12,562,825
June 1 - June 30, 2017(1)	3,052		33.01	—		12,562,825
Total	63,178	$	31.72	—	$	12,562,825

(1)	These shares represent shares purchased other than through publicly announced plans and were purchased pursuant to the Company’s stock incentive plans. Pursuant to the plans, shares were purchased from plan participants at the then current market value in satisfaction of stock option exercise prices, settlements of restricted stock and tax withholdings.
(2)	On August 5, 2016, the Company’s Board of Directors authorized the repurchase of up to an additional $50.0 million of common stock. Under this authorization, $12,562,825 remained available for purchase at June 30, 2017.

Item 5. OTHER INFORMATION

None.

Item 6. EXHIBITS  

The exhibits required to be furnished with this report are listed on the exhibit index attached hereto and incorporated herein by reference.

67

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

National Bank Holdings Corporation

By	/s/ Brian F. Lilly
	Brian F. Lilly
	Chief Financial Officer; Chief of M&A and Strategy
	(principal financial officer)

Date: August 4, 2017

68

EXHIBIT INDEX

2.1*	Agreement and Plan Merger, dated as of June 23, 2017, by and among Peoples, Inc., National Bank Holdings Corporation, the Significant Stockholders (as defined herein) and Winton A. Winter, Jr., solely in his capacity as the Holders’ Representative (incorporated herein by reference to Exhibit 2.1 to our Form 8-K dated June 23, 2017 and filed on June 27, 2017)
3.1	Second Amended and Restated Certificate of Incorporation (incorporated herein by reference to Exhibit 3.1 to our Form S-1 Registration Statement (Registration No. 333-177971), filed August 22, 2012)
3.2	Second Amended and Restated By-Laws (incorporated herein by reference to Exhibit 3.2 to our Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2015, filed November 7, 2014)
10.1	Support Agreement, dated as of June 23, 2017, by and among Peoples, Inc., National Bank Holdings Corporation and the undersigned stockholders of Peoples, Inc. (incorporated herein by reference to Exhibit 10.1 to our Form 8-K dated June 23, 2017 and filed on June 27, 2017)
31.1	Certification of CEO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of CFO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32	Certifications of CEO and CFO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101	Interactive data files pursuant to Rule 405 of Regulation S-T: (i) the Consolidated Statements of Financial Condition, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Comprehensive Income, (iv) the Consolidated Statements of Changes in Shareholders’ Equity, (v) the Consolidated Statements of Cash Flows and (vi) the Notes to Consolidated Financial Statements, tagged as blocks of text and in detail

*Schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K. A copy of any omitted schedule or exhibit will be furnished supplementally to the Securities and Exchange Commission upon request.

69

EX-31.1

Exhibit 31.1

Certifications of CEO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, G. Timothy Laney, Chief Executive Officer, certify that:

1. I have reviewed this quarterly report on Form 10-Q of National Bank Holdings Corporation;

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 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.

Date:	August 4, 2017	/s/ G. Timothy Laney
		G. Timothy Laney
		Chairman, President and Chief Executive Officer

EX-31.2

Exhibit 31.2

Certifications of CFO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Brian F. Lilly, Chief Financial Officer, certify that:

1. I have reviewed this quarterly report on Form 10-Q of National Bank Holdings Corporation;

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 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.

Date:	August 4, 2017	/s/ Brian F. Lilly
		Brian F. Lilly
		Chief Financial Officer; Chief of M&A and Strategy

EX-32

Exhibit 32

Certifications of CEO and CFO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the quarterly report of National Bank Holdings Corporation (the “Company”) on Form 10-Q  for the period ended June 30, 2017, as filed with the Securities and Exchange Commission (the “Report”), each of the undersigned officers certifies pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge: (1) this Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and (2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operation of the Company.

Date:	August 4, 2017	/s/ G. Timothy Laney
		G. Timothy Laney
		Chairman, President and Chief Executive Officer
Date:	August 4, 2017	/s/ Brian F. Lilly
		Brian F. Lilly
		Chief Financial Officer; Chief of M&A and Strategy

XML

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2017	Aug. 03, 2017
Document Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2017
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	Q2
Trading Symbol	NBHC
Entity Registrant Name	National Bank Holdings Corp
Entity Central Index Key	0001475841
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		26,791,575
Entity Current Reporting Status	Yes

XML

Consolidated Statements of Financial Condition (Unaudited) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
ASSETS
Cash and cash equivalents	$ 129,827	$ 152,736
Investment securities available-for-sale (at fair value)	866,714	884,232
Investment securities held-to-maturity (at amortized cost)	294,891	332,505
Non-marketable securities	18,468	14,949
Loans	3,087,945	2,860,921
Allowance for loan losses	(34,959)	(29,174)
Loans, net	3,052,986	2,831,747
Loans held for sale	7,067	24,187
Other real estate owned	14,297	15,662
Premises and equipment, net	92,321	95,671
Goodwill	59,630	59,630
Intangible assets, net	4,210	6,949
Other assets	152,358	154,778
Total assets	4,692,769	4,573,046
Liabilities:
Non-interest bearing demand deposits	870,875	846,744
Interest bearing demand deposits	418,729	427,538
Savings and money market	1,441,372	1,422,321
Time deposits	1,126,481	1,172,046
Total deposits	3,857,457	3,868,649
Securities sold under agreements to repurchase	119,213	92,011
Federal Home Loan Bank advances	129,115	38,665
Other liabilities	42,497	37,532
Total liabilities	4,148,282	4,036,857
Shareholders' equity:
Common stock	515	514
Additional paid in capital	971,145	984,087
Retained earnings	68,570	55,454
Treasury stock at cost	(494,547)	(502,104)
Accumulated other comprehensive income (loss), net of tax	(1,196)	(1,762)
Total shareholders' equity	544,487	536,189
Total liabilities and shareholders' equity	$ 4,692,769	$ 4,573,046

XML

Consolidated Statements of Financial Condition (Unaudited) (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Statement of Financial Position [Abstract]
Investment securities held-to-maturity, fair value	$ 294,869	$ 332,573
Common Stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common Stock, shares authorized	400,000,000	400,000,000
Common Stock, shares issued	51,587,424	51,813,011
Common Stock, shares outstanding	26,788,833	26,386,583
Treasury stock, shares	24,542,527	24,927,157

XML

Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Interest and dividend income:
Interest and fees on loans	$ 34,411	$ 30,071	$ 66,174	$ 63,027
Interest and dividends on investment securities	6,489	7,759	13,102	15,994
Dividends on non-marketable securities	218	193	385	421
Interest on interest-bearing bank deposits	214	449	411	584
Total interest and dividend income	41,332	38,472	80,072	80,026
Interest expense:
Interest on deposits	3,904	3,516	7,691	6,826
Interest on borrowings	536	203	767	409
Total interest expense	4,440	3,719	8,458	7,235
Net interest income before provision for loan losses	36,892	34,753	71,614	72,791
Provision for loan losses	4,025	6,457	5,820	17,076
Net interest income after provision for loan losses	32,867	28,296	65,794	55,715
Non-interest income:
Service charges	3,546	3,465	6,872	6,725
Bank card fees	3,134	2,935	5,938	5,702
Gain on sale of mortgages, net	594	958	1,048	1,432
Bank-owned life insurance income	472	486	942	881
Other non-interest income	4,124	2,473	5,538	3,164
OREO related write-ups and other income	86	187	314	523
Total non-interest income	11,956	10,504	20,652	18,427
Non-interest expense:
Salaries and benefits	19,909	19,612	40,299	40,224
Occupancy and equipment	5,242	5,708	10,679	11,774
Telecommunications and data processing	1,552	1,471	3,139	3,112
Marketing and business development	545	689	1,196	1,115
FDIC deposit insurance	686	1,064	1,391	1,985
Bank card expenses	896	963	1,779	1,876
Professional fees	1,270	978	1,686	1,434
Other non-interest expense	2,733	2,112	5,139	4,067
Problem asset workout	880	958	1,752	1,932
Gain on OREO sales, net	(1,644)	(1,611)	(1,756)	(2,043)
Intangible asset amortization	1,370	1,370	2,740	2,740
Total non-interest expense	33,439	33,314	68,044	68,216
Income before income taxes	11,384	5,486	18,402	5,926
Income tax expense	2,175	982	935	1,171
Net income	$ 9,209	$ 4,504	$ 17,467	$ 4,755
Income per share-basic (in dollars per share)	$ 0.34	$ 0.15	$ 0.65	$ 0.16
Income per share-diluted (in dollars per share)	$ 0.33	$ 0.15	$ 0.63	$ 0.16
Weighted average number of common shares outstanding:
Basic (Shares)	26,955,187	29,215,822	26,878,904	29,666,570
Diluted (Shares)	27,597,443	29,278,759	27,637,532	29,707,379

XML

Consolidated Statements of Comprehensive Income (Loss) (Unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Statement of Comprehensive Income [Abstract]
Net income	$ 9,209	$ 4,504	$ 17,467	$ 4,755
Securities available-for-sale:
Net unrealized gains (losses) arising during the period, net of tax	1,014	3,221	1,276	12,198
Less: amortization of net unrealized holding gains to income, net of tax	(353)	(495)	(710)	(1,015)
Other comprehensive income (loss)	661	2,726	566	11,183
Comprehensive income (loss)	$ 9,870	$ 7,230	$ 18,033	$ 15,938

XML

Consolidated Statements of Comprehensive Income (Loss) (Unaudited) (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Statement of Comprehensive Income [Abstract]
Tax (expense) benefit on net unrealized gains arising during the period	$ (631)	$ (1,976)	$ (792)	$ (7,487)
Tax (expense) benefit of amortization of net unrealized holding gains to income	$ 217	$ 304	$ 435	$ 623

XML

Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands	Common stock [Member]	Additional paid-in capital [Member]	Retained earnings [Member]	Treasury stock [Member]	Accumulated other comprehensive income, net [Member]	Total
Balance in the beginning at Dec. 31, 2015	$ 513	$ 997,926	$ 38,670	$ (419,660)	$ 95	$ 617,544
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income			4,755			4,755
Stock-based compensation		1,791				1,791
Issuance under purchase and equity compensation plans, including (gain) loss on reissuance of treasury stock	1	(2,862)		2,422		(439)
Repurchase of shares				(32,918)		(32,918)
Cash dividends declared			(3,006)			(3,006)
Other comprehensive income (loss)					11,183	11,183
Balance in the ending at Jun. 30, 2016	514	996,855	40,419	(450,156)	11,278	598,910
Balance in the beginning at Dec. 31, 2016	514	984,087	55,454	(502,104)	(1,762)	536,189
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income			17,467			17,467
Stock-based compensation		1,869				1,869
Issuance under purchase and equity compensation plans, including (gain) loss on reissuance of treasury stock	1	(12,878)		5,624		(7,253)
Cash dividends declared			(4,351)			(4,351)
Warrant exercise		(1,933)		1,933
Other comprehensive income (loss)					566	566
Balance in the ending at Jun. 30, 2017	$ 515	$ 971,145	$ 68,570	$ (494,547)	$ (1,196)	$ 544,487

XML

Consolidated Statements of Changes in Stockholders' Equity (Parenthetical) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Statement of Stockholders' Equity [Abstract]
Excess tax benefit from stock-based compensation		$ 39
Gain (loss) on reissuance of treasury stock	$ 5,004	$ (50)
Shares repurchased (shares)		1,671,923
Cash dividends declared per share	$ 0.16	$ 0.1

XML

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Cash flows from operating activities:
Net income	$ 17,467	$ 4,755
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Provision for loan losses	5,820	17,076
Depreciation and amortization	6,630	7,394
Current income tax receivable	1,622	6,395
Deferred income tax (asset) liability	(369)	3,710
Net excess tax (benefit) deficit on stock-based compensation	(3,393)	52
Discount accretion, net of premium amortization on securities	1,324	1,534
Loan accretion	(12,728)	(18,924)
Gain on sale of mortgage loans, net	(1,048)	(1,432)
Origination of loans held for sale, net of repayments	(39,279)	(44,593)
Proceeds from sales of loans held for sale	53,719	47,020
Bank-owned life insurance income	(942)	(881)
Gain on the sale of other real estate owned, net	(1,756)	(2,043)
Impairment on other real estate owned	46	104
Gain on sale of fixed assets	40	(1,839)
Gain on banking center divestitures	(2,886)
Stock-based compensation	1,869	1,791
(Increase) decrease in other assets	1,947	(6,210)
(Decrease) increase in other liabilities	6,547	12,639
Net cash provided by (used in) operating activities	34,630	26,548
Cash flows from investing activities:
Purchase of FHLB stock	(7,204)	(500)
Proceeds from redemption of FHLB stock	3,685	5,761
Proceeds from redemption of FRB stock		4,964
Proceeds from maturities of investment securities held-to-maturity	36,216	44,442
Proceeds from maturities of investment securities available-for-sale	115,268	134,464
Purchase of investment securities available-for-sale	(96,948)	(4,872)
Net increase in loans	(243,118)	(146,274)
Sales (purchases) of premises and equipment, net	(581)	1,718
Purchase of bank-owned life insurance		(10,344)
Proceeds from sales of loans	33,813	9,231
Proceeds from sales of other real estate owned	3,714	3,165
Net cash provided by (used in) investing activities	(155,155)	41,755
Cash flows from financing activities:
Net increase (decrease) in deposits	(8,308)	(39,732)
Increase (decrease) in repurchase agreements	27,202	(10,377)
Advances from FHLB	253,129
FHLB payoffs	(162,679)
Issuance of stock under purchase and equity compensation plans	(7,253)	(485)
Payment of dividends	(4,475)	(2,944)
Repurchase of shares		(32,918)
Net cash proivded by (used in) financing activities	97,616	(86,456)
Increase (decrease) in cash and cash equivalents	(22,909)	(18,153)
Cash and cash equivalents at beginning of the year	152,736	166,092
Cash and cash equivalents at end of year	129,827	147,939
Supplemental disclosure of cash flow information during the period:
Cash paid for interest	8,333	7,084
Net tax (refunds) payments	33	(2,117)
Supplemental schedule of non-cash investing activities:
Loans transferred to other real estate owned at fair value	639	3,654
Loans purchased but not settled	1,937	$ 667
Transfer of Loans Held-for-sale to Portfolio Loans	$ 3,729

XML

Basis of Presentation

6 Months Ended

Jun. 30, 2017

Accounting Policies [Abstract]

Basis of Presentation

Note 1 Basis of Presentation

National Bank Holdings Corporation ("NBHC" or the "Company") is a bank holding company that was incorporated in the State of Delaware in June 2009 with the intent to acquire and operate financial services franchises and other complementary businesses in targeted markets. The Company is headquartered immediately south of Denver, in Greenwood Village, Colorado, and its primary operations are conducted through its wholly owned subsidiary, NBH Bank, referred to as the Bank, or NBH Bank, a Colorado state-chartered bank and a member of the Federal Reserve System. The Company provides a variety of banking products to both commercial and consumer clients through a network of 86 banking centers located in Colorado, the greater Kansas City area and Texas, and through online and mobile banking products.

The accompanying interim unaudited consolidated financial statements serve to update the National Bank Holdings Corporation Annual Report on Form 10-K for the year ended December 31, 2016 and include the accounts of the Company and its wholly owned subsidiary, NBH Bank. The accompanying unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and where applicable, with general practices in the banking industry or guidelines prescribed by bank regulatory agencies. However, they may not include all information and notes necessary to constitute a complete set of financial statements under GAAP applicable to annual periods and accordingly should be read in conjunction with the financial information contained in the Company's most recent Form 10-K. The unaudited consolidated financial statements reflect all adjustments which are, in the opinion of management, necessary for a fair statement of the results presented. All such adjustments are of a normal recurring nature. All significant intercompany balances and transactions have been eliminated in consolidation. Certain reclassifications of prior years' amounts are made whenever necessary to conform to current period presentation. The results of operations for the interim period is not necessarily indicative of the results that may be expected for the full year or any other interim period. All amounts are in thousands, except share data, or as otherwise noted.

GAAP requires management to make estimates that affect the reported amounts of assets, liabilities, revenues and expenses, and disclosures of contingent assets and liabilities. By their nature, estimates are based on judgment and available information. Management has made significant estimates in certain areas, such as the amount and timing of expected cash flows from assets, the valuation of other real estate owned (“OREO”), the fair value adjustments on assets acquired and liabilities assumed, the valuation of core deposit intangible assets, the valuation of investment securities for other-than-temporary impairment (“OTTI”), the valuation of stock-based compensation, the fair values of financial instruments, the allowance for loan losses (“ALL”), and contingent liabilities. Because of the inherent uncertainties associated with any estimation process and future changes in market and economic conditions, it is possible that actual results could differ significantly from those estimates.

The Company's significant accounting policies followed in the preparation of the unaudited consolidated financial statements are disclosed in note 2 of the audited financial statements and notes for the year ended December 31, 2016 and are contained in the Company's Annual Report on Form 10-K. There have not been any significant changes to the application of significant accounting policies since December 31, 2016

XML

Recent Accounting Pronouncements

6 Months Ended

Jun. 30, 2017

Text Block [Abstract]

Recent Accounting Pronouncements

Note 2 Recent Accounting Pronouncements

Revenue from Contracts with Customers—In May 2014, the FASB issued ASU 2014-09, "Revenue from Contracts with Customers."  This update supersedes revenue recognition requirements in ASC Topic 605, Revenue Recognition, including most industry-specific revenue recognition guidance in the FASB Accounting Standards Codification. The new guidance stipulates that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance provides specific steps that entities should apply in order to achieve this principle. The amendments are effective for interim and annual periods beginning after December 15, 2017, with early application permitted for interim and annual periods beginning after December 15, 2016. ASU No. 2014-09 allows for either full retrospective or modified retrospective adoption. The Company is in the process of evaluating the impact of the ASU's adoption on the Company's consolidated financial statements, if any. The Company will adopt ASU 2014-09 in the first quarter of 2018 and expects to apply the modified retrospective approach.

The new guidance does not apply to revenue associated with financial instruments, including loans and securities that are accounted for under other GAAP; therefore, the Company does not expect the new guidance to have a material impact on revenue most closely associated with financial instruments, including interest income and expense. The Company is continuing its overall assessment of revenue streams and reviewing contracts potentially affected by the ASU, most notably deposit service charges and bank card fees to determine the potential impact the new guidance is expected to have on the Company’s consolidated financial statements. In addition, the Company continues to follow certain implementation issues relevant to the banking industry which are still pending resolution. The Company will adopt ASU No. 2014-09 on January 1, 2018 and expects to utilize the modified retrospective approach.

Leases—In February 2016, the FASB issued ASU 2016-02, Leases. The guidance in ASU 2016-02 supersedes the lease recognition requirements in ASC Topic 840, Leases. The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statements. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. Early adoption of the amendments in the update is permitted. The Company will adopt ASU 2016-02 in the first quarter of 2019 and is currently in the process of evaluating the impact of the ASU's adoption on the Company's consolidated financial statements.

Financial Instruments - Credit Losses—In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments. This update replaces the current incurred loss methodology for recognizing credit losses with a current expected credit loss model, which requires the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. This amendment broadens the information that an entity must consider in developing its expected credit loss estimates. Additionally, the update amends the accounting for credit losses for available-for-sale debt securities and purchased financial assets with a more-than-insignificant amount of credit deterioration since origination. This update requires enhanced disclosures to help investors and other financial statement users better understand significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of a company’s loan portfolio. The amendments in this update are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption in fiscal years beginning after December 15, 2018 is permitted. The amendment requires the use of the modified retrospective approach for adoption. The Company is in the process of evaluating the impact of the ASU’s adoption on the Company’s consolidated financial statements.

The Company reviewed ASU 2016-01, Financial Instruments – Recognition and Measurement of Financial Assets and Financial Liabilities (Topic 825), ASU 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments, ASU 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment and ASU 2017-05, Other Income – Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20) and does not expect the adoption of these pronouncements to have a material impact on its financial statements.

XML

Investment Securities

6 Months Ended

Jun. 30, 2017

Investments, Debt and Equity Securities [Abstract]

Investment Securities

Note 3 Investment Securities

The Company’s investment securities portfolio is comprised of available-for-sale and held-to-maturity investment securities. These investment securities totaled $1.2 billion at June 30, 2017 and included $0.9 billion of available-for-sale securities and $0.3 billion of held-to-maturity securities. At December 31, 2016, investment securities totaled $1.2 billion and included $0.9 billion of available-for-sale securities and $0.3 billion of held-to-maturity securities.

Available-for-sale

At June 30, 2017 and December 31, 2016, the Company held $0.9 billion of available-for-sale investment securities. Available-for-sale securities are summarized as follows as of the dates indicated:

	June 30, 2017
	Amortized		Gross		Gross
	cost		unrealized gains		unrealized losses		Fair value
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	192,369	$	3,476	$	(504)	$	195,341
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		680,040		1,604		(13,013)		668,631
Municipal securities		2,323		—		—		2,323
Other securities		419		—		—		419
Total	$	875,151	$	5,080	$	(13,517)	$	866,714

	December 31, 2016
	Amortized		Gross		Gross
	cost		unrealized gains		unrealized losses		Fair value
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	223,781	$	3,909	$	(530)	$	227,160
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		666,616		2,124		(16,001)		652,739
Municipal securities		3,921		—		(7)		3,914
Other securities		419		—		—		419
Total	$	894,737	$	6,033	$	(16,538)	$	884,232

At June 30, 2017 and December 31, 2016, mortgage-backed securities represented primarily all of the Company’s available-for-sale investment portfolio and all mortgage-backed securities were backed by government sponsored enterprises (“GSE”) collateral such as Federal Home Loan Mortgage Corporation (“FHLMC”) and Federal National Mortgage Association (“FNMA”), and the government sponsored agency Government National Mortgage Association (“GNMA”).

The table below summarizes the available-for-sale securities with unrealized losses as of the dates shown, along with the length of the impairment period:

	June 30, 2017
	Less than 12 months				12 months or more				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	value		losses		value		losses		value		losses
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	79,548	$	(504)	$	—	$	—	$	79,548	$	(504)
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		148,819		(2,279)		354,843		(10,734)		503,662		(13,013)
Total	$	228,367	$	(2,783)	$	354,843	$	(10,734)	$	583,210	$	(13,517)

	December 31, 2016
	Less than 12 months				12 months or more				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	value		losses		value		losses		value		losses
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	100,898	$	(530)	$	—	$	—	$	100,898	$	(530)
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		137,576		(2,976)		385,707		(13,025)		523,283		(16,001)
Municipal securities		3,058		(7)		—		—		3,058		(7)
Total	$	241,532	$	(3,513)	$	385,707	$	(13,025)	$	627,239	$	(16,538)

The unrealized losses in the Company's investment portfolio at June 30, 2017 were caused by changes in interest rates. The portfolio included 63 securities, having an aggregate fair value of $583.2 million, which were in an unrealized loss position at June 30, 2017. During the six months ended June 30, 2017, the Company recorded $0.2 million of other-than-temporary impairment (OTTI) included in other non-interest expense on the consolidated statement of operations. The OTTI credit charge was on a single municipal security, with an aggregate fair value of $1.5 million.

The unrealized losses in the Company's investment portfolio at December 31, 2016 were caused by changes in interest rates. The portfolio included 61 securities, having an aggregate fair value of $627.2 million, which were in an unrealized loss position at December 31, 2016. Management evaluated all of the available-for-sale securities in an unrealized position and concluded no OTTI existed at December 31, 2016.

The Company has no intention to sell these securities before recovery of their amortized cost and believes it will not be required to sell the securities before the recovery of their amortized cost.

Certain securities are pledged as collateral for public deposits, securities sold under agreements to repurchase, and to secure borrowing capacity at the Federal Reserve Bank and Federal Home Loan Bank (“FHLB”), if needed. The fair value of available-for-sale investment securities pledged as collateral totaled $296.4 million at June 30, 2017 and $373.7 million at December 31, 2016. Certain investment securities may also be pledged as collateral for the line of credit at the FHLB of Topeka; at June 30, 2017 and December 31, 2016, no securities were pledged for this purpose.

Mortgage-backed securities do not have a single maturity date and actual maturities may differ from contractual maturities depending on the repayment characteristics and experience of the underlying financial instruments. The estimated weighted average life of the available-for-sale mortgage-backed securities portfolio was 3.1 years at June 30, 2017 and 3.4 years at December 31, 2016. This estimate is based on assumptions and actual results may differ. At June 30, 2017 and December 31, 2016, the duration of the total available-for-sale investment portfolio was 2.9 years and 3.2 years, respectively.

As of June 30, 2017, municipal securities with an amortized cost and fair value of $1.5 million were due in one year, municipal securities with an amortized cost and fair value of $0.3 million were due after one year through five years, and municipal securities with an amortized cost and fair value of $0.6 million were due after five years through ten years. Other securities of $0.4 million as of June 30, 2017, have no stated contractual maturity date.

Held-to-maturity

At June 30, 2017 and December 31, 2016, the Company held $294.9 million and $332.5 million of held-to-maturity investment securities, respectively. Held-to-maturity investment securities are summarized as follows as of the dates indicated:

	June 30, 2017
			Gross		Gross
	Amortized		unrealized		unrealized
	cost		gains		losses		Fair value
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	233,026	$	1,332	$	(164)	$	234,194
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		61,865		11		(1,201)		60,675
Total investment securities held-to-maturity	$	294,891	$	1,343	$	(1,365)	$	294,869

	December 31, 2016
			Gross		Gross
	Amortized		unrealized		unrealized
	cost		gains		losses		Fair value
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	263,411	$	1,685	$	(234)	$	264,862
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		69,094		16		(1,399)		67,711
Total investment securities held-to-maturity	$	332,505	$	1,701	$	(1,633)	$	332,573

The table below summarizes the held-to-maturity securities with unrealized losses as of the dates shown, along with the length of the impairment period:

	June 30, 2017
	Less than 12 months				12 months or more				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	value		losses		value		losses		value		losses
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	25,512	$	(164)	$	—	$	—	$	25,512	$	(164)
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		23,861		(306)		29,244		(895)		53,105		(1,201)
Total	$	49,373	$	(470)	$	29,244	$	(895)	$	78,617	$	(1,365)

	December 31, 2016
	Less than 12 months				12 months or more				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	value		losses		value		losses		value		losses
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	27,799	$	(234)	$	—	$	—	$	27,799	$	(234)
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		26,992		(357)		32,146		(1,042)		59,138		(1,399)
Total	$	54,791	$	(591)	$	32,146	$	(1,042)	$	86,937	$	(1,633)

The held-to-maturity portfolio included 16 securities, having an aggregate fair value of $78.6 million, which were in an unrealized loss position at June 30, 2017, compared to 15 securities, with a fair value of $86.9 million, at December 31, 2016.

Management evaluated all of the held-to-maturity securities in an unrealized loss position and concluded that no OTTI existed at June 30, 2017 or December 31, 2016. The unrealized losses in the Company's investments issued or guaranteed by U.S. government agencies or sponsored enterprises at June 30, 2017 were caused by changes in interest rates. The Company has no intention to sell these securities before recovery of their amortized cost and believes it will not be required to sell the securities before the recovery of their amortized cost.

The carrying value of held-to-maturity investment securities pledged as collateral totaled $139.8 million and $119.2 million at June 30, 2017 and December 31, 2016, respectively. 

Actual maturities of mortgage-backed securities may differ from scheduled maturities depending on the repayment characteristics and experience of the underlying financial instruments. The estimated weighted average expected life of the held-to-maturity mortgage-backed securities portfolio as of June 30, 2017 and December 31, 2016 was 3.1 years and 3.5 years, respectively. This estimate is based on assumptions and actual results may differ. The duration of the total held-to-maturity investment portfolio was 2.9 years and 3.2 years as of June 30, 2017 and December 31, 2016, respectively.

XML

Loans

6 Months Ended

Jun. 30, 2017

Receivables [Abstract]

Loans

Note 4 Loans

The loan portfolio is comprised of loans originated by the Company and loans that were acquired in connection with the Company’s acquisitions.

The table below shows the loan portfolio composition including carrying value by segment of loans accounted for under ASC Topic 310-30, Receivables—Loans and Debt Securities Acquired with Deteriorated Credit Quality, and loans not accounted for under this guidance, which includes the Company’s originated loans. The carrying value of loans is net of discounts on loans excluded from ASC 310-30, and fees and costs of $4.9 million and $6.3 million as of June 30, 2017 and December 31, 2016, respectively. At December 31, 2016, $14.4 million of non 310-30 loans were held-for-sale, most of which were in the residential real estate segment. The sale of these loans was completed in connection with the four banking center divestitures in the second quarter of 2017.

	June 30, 2017
	ASC 310-30 loans		Non 310-30 loans		Total loans		% of total
Commercial	$	35,978	$	1,739,476	$	1,775,454	57.5%
Commercial real estate non-owner occupied		83,785		473,235		557,020	18.0%
Residential real estate		14,012		714,499		728,511	23.6%
Consumer		652		26,308		26,960	0.9%
Total	$	134,427	$	2,953,518	$	3,087,945	100.0%

	December 31, 2016
	ASC 310-30 loans		Non 310-30 loans		Total loans		% of total
Commercial	$	39,280	$	1,521,150	$	1,560,430	54.6%
Commercial real estate non-owner occupied		89,150		437,642		526,792	18.4%
Residential real estate		16,524		728,361		744,885	26.0%
Consumer		898		27,916		28,814	1.0%
Total	$	145,852	$	2,715,069	$	2,860,921	100.0%

Delinquency for loans excluded from ASC 310-30 is shown in the following tables at June 30, 2017 and December 31, 2016, respectively:

	June 30, 2017
					Greater						Total		Loans > 90
	30-59		60-89		than 90						non		days past
	days  past		days past		days past		Total  past				310-30		due and		Non-
	due		due		due		due		Current		loans		still accruing		accrual
Loans excluded from ASC 310-30:
Commercial:
Commercial and industrial	$	658	$	228	$	4,135	$	5,021	$	1,270,834	$	1,275,855	$	—	$	7,780
Owner occupied commercial real estate		890		—		52		942		232,988		233,930		—		4,377
Agriculture		512		—		435		947		130,451		131,398		—		2,208
Energy		—		—		6,613		6,613		91,680		98,293		—		12,050
Total commercial		2,060		228		11,235		13,523		1,725,953		1,739,476		—		26,415
Commercial real estate non-owner occupied:
Construction		—		—		215		215		121,441		121,656		215		—
Acquisition/development		334		—		—		334		16,008		16,342		—		—
Multifamily		—		—		—		—		41,430		41,430		—		—
Non-owner occupied		135		—		—		135		293,672		293,807		—		35
Total commercial real estate		469		—		215		684		472,551		473,235		215		35
Residential real estate:
Senior lien		854		1,667		1,298		3,819		658,403		662,222		—		5,286
Junior lien		185		47		8		240		52,037		52,277		—		557
Total residential real estate		1,039		1,714		1,306		4,059		710,440		714,499		—		5,843
Consumer		69		19		6		94		26,214		26,308		—		162
Total loans excluded from ASC 310-30	$	3,637	$	1,961	$	12,762	$	18,360	$	2,935,158	$	2,953,518	$	215	$	32,455

	December 31, 2016
					Greater						Total		Loans > 90
	30-59		60-89		than 90						non		days past
	days past		days past		days past		Total  past				310-30		due and		Non-
	due		due		due		due		Current		loans		still accruing		accrual
Loans excluded from ASC 310-30:
Commercial:
Commercial and industrial	$	3,134	$	4,009	$	1,078	$	8,221	$	1,066,475	$	1,074,696	$	—	$	8,688
Owner occupied commercial real estate		583		216		56		855		220,689		221,544		—		2,056
Agriculture		501		—		—		501		134,136		134,637		—		1,905
Energy		2		—		6,548		6,550		83,723		90,273		—		12,645
Total commercial		4,220		4,225		7,682		16,127		1,505,023		1,521,150		—		25,294
Commercial real estate non-owner occupied:
Construction		—		—		—		—		90,314		90,314		—		—
Acquisition/development		—		—		—		—		13,306		13,306		—		—
Multifamily		—		—		—		—		24,954		24,954		—		—
Non-owner occupied		—		—		28		28		309,040		309,068		—		66
Total commercial real estate		—		—		28		28		437,614		437,642		—		66
Residential real estate:
Senior lien		888		645		1,458		2,991		672,699		675,690		—		4,522
Junior lien		115		61		22		198		52,473		52,671		—		654
Total residential real estate		1,003		706		1,480		3,189		725,172		728,361		—		5,176
Consumer		83		8		—		91		27,825		27,916		—		181
Total loans excluded from ASC 310-30	$	5,306	$	4,939	$	9,190	$	19,435	$	2,695,634	$	2,715,069	$	—	$	30,717

Loans are considered past due or delinquent when the contractual principal or interest due in accordance with the terms of the loan agreement remains unpaid after the due date of the scheduled payment. Pooled loans accounted for under ASC 310-30 that are 90 days or more past due and still accreting are generally considered to be performing and are included in loans 90 days or more past due and still accruing. Non-accrual loans include troubled debt restructurings on non-accrual status.

Non-accrual loans excluded from the scope of ASC 310-30 totaled $32.5 million at June 30, 2017, increasing $1.7 million, or 5.7% from December 31, 2016. The increase was driven primarily by one loan relationship totaling $2.2 million in the owner occupied commercial real estate sector placed on non-accrual during the second quarter of 2017, offset by other net decreases of $0.5 million.

Credit exposure for all loans as determined by the Company’s internal risk rating system was as follows as of June 30, 2017 and December 31, 2016, respectively:

	June 30, 2017
			Special
	Pass		mention		Substandard		Doubtful		Total
Loans excluded from ASC 310-30:
Commercial:
Commercial and industrial	$	1,243,638	$	13,978	$	15,472	$	2,767	$	1,275,855
Owner occupied commercial real estate		222,882		4,607		6,196		245		233,930
Agriculture		106,022		22,668		2,674		34		131,398
Energy		86,243		—		5,998		6,052		98,293
Total commercial		1,658,785		41,253		30,340		9,098		1,739,476
Commercial real estate non-owner occupied:
Construction		121,441		—		215		—		121,656
Acquisition/development		13,844		2,498		—		—		16,342
Multifamily		39,255		—		2,175		—		41,430
Non-owner occupied		291,007		1,566		1,234		—		293,807
Total commercial real estate		465,547		4,064		3,624		—		473,235
Residential real estate:
Senior lien		656,249		251		5,709		13		662,222
Junior lien		51,404		—		873		—		52,277
Total residential real estate		707,653		251		6,582		13		714,499
Consumer		26,086		56		166		—		26,308
Total loans excluded from ASC 310-30	$	2,858,071	$	45,624	$	40,712	$	9,111	$	2,953,518
Loans accounted for under ASC 310-30:
Commercial	$	27,799	$	1,105	$	7,074	$	—	$	35,978
Commercial real estate non-owner occupied		54,207		1,701		27,877		—		83,785
Residential real estate		11,234		1,088		1,690		—		14,012
Consumer		464		12		176		—		652
Total loans accounted for under ASC 310-30	$	93,704	$	3,906	$	36,817	$	—	$	134,427
Total loans	$	2,951,775	$	49,530	$	77,529	$	9,111	$	3,087,945

	December 31, 2016
			Special
	Pass		mention		Substandard		Doubtful		Total
Loans excluded from ASC 310-30:
Commercial:
Commercial and industrial	$	1,041,326	$	7,243	$	25,636	$	491	$	1,074,696
Owner occupied commercial real estate		202,036		9,371		10,137		—		221,544
Agriculture		123,809		8,922		1,906		—		134,637
Energy		77,619		—		7,811		4,843		90,273
Total commercial		1,444,790		25,536		45,490		5,334		1,521,150
Commercial real estate non-owner occupied:
Construction		90,099		—		215		—		90,314
Acquisition/development		10,758		2,548		—		—		13,306
Multifamily		22,495		238		2,221		—		24,954
Non-owner occupied		300,922		5,895		2,251		—		309,068
Total commercial real estate		424,274		8,681		4,687		—		437,642
Residential real estate:
Senior lien		669,148		1,215		5,316		11		675,690
Junior lien		51,250		178		1,243		—		52,671
Total residential real estate		720,398		1,393		6,559		11		728,361
Consumer		27,669		59		188		—		27,916
Total loans excluded from ASC 310-30	$	2,617,131	$	35,669	$	56,924	$	5,345	$	2,715,069
Loans accounted for under ASC 310-30:
Commercial	$	27,436	$	610	$	11,234	$	—	$	39,280
Commercial real estate non-owner occupied		38,895		967		45,520		3,768		89,150
Residential real estate		12,477		1,327		2,720		—		16,524
Consumer		721		17		160		—		898
Total loans accounted for under ASC 310-30	$	79,529	$	2,921	$	59,634	$	3,768	$	145,852
Total loans	$	2,696,660	$	38,590	$	116,558	$	9,113	$	2,860,921

Non 310-30 substandard loans within the commercial and industrial sector decreased from December 31, 2016, primarily due to two loan relationship upgrades totaling $6.2 million from substandard to special mention and one loan relationship downgrade totaling $2.1 million from substandard to doubtful during the six months ended June 30, 2017. Non 310-30 substandard loans within the owner occupied commercial real estate sector decreased from December 31, 2016, primarily due to two loan relationship upgrades totaling $5.5 million from substandard to special mention, partially offset by one loan relationship placed on non-accrual and included in substandard during the second quarter of 2017 totaling $1.4 million. Non 310-30 doubtful loans within the energy sector increased from December 31, 2016, due to increased specific reserves on one relationship previously placed on non-accrual.

Impaired Loans

Loans are considered to be impaired when it is probable that the Company will not be able to collect all amounts due in accordance with the contractual terms of the loan agreement. Impaired loans are comprised of loans excluded from ASC 310-30 on non-accrual status, loans in bankruptcy, and troubled debt restructurings (“TDRs”) described below. If a specific allowance is warranted based on the borrower’s overall financial condition, the specific allowance is calculated based on discounted cash flows using the loan’s initial contractual effective interest rate or the fair value of the collateral less selling costs for collateral dependent loans. At June 30, 2017, the Company measured $29.0 million of impaired loans based on the fair value of the collateral less selling costs and $2.5 million of impaired loans using discounted cash flows and the loan’s initial contractual effective interest rate. Impaired loans totaling $7.9 million that individually were less than $250 thousand each, were measured through the general ALL reserves due to their relatively small size.

At June 30, 2017 and December 31, 2016, the Company’s recorded investments in impaired loans were $39.4 million and $38.3 million, respectively. Impaired loans at June 30, 2017 were primarily comprised of eight relationships totaling $24.6 million. Three of the relationships were in the energy sector, three of the relationships were in the commercial and industrial sector, one relationship was in the owner-occupied commercial real estate sector and one relationship was in the agricultural sector. Impaired loans had a collective related allowance for loan losses allocated to them of $6.2 million and $2.4 million at June 30, 2017 and December 31, 2016, respectively.

Additional information regarding impaired loans at June 30, 2017 and December 31, 2016 is set forth in the table below:

	June 30, 2017						December 31, 2016
					Allowance						Allowance
	Unpaid				for loan		Unpaid				for loan
	principal		Recorded		losses		principal		Recorded		losses
	balance		investment		allocated		balance		investment		allocated
With no related allowance recorded:
Commercial:
Commercial and industrial	$	6,712	$	5,387	$	—	$	8,671	$	7,495	$	—
Owner occupied commercial real estate		3,954		3,755		—		3,350		3,197		—
Agriculture		1,581		1,377		—		2,044		1,987		—
Energy		16,548		5,437		—		17,142		6,105		—
Total commercial		28,795		15,956		—		31,207		18,784		—
Commercial real estate non-owner occupied:
Construction		—		—		—		—		—		—
Acquisition/development		—		—		—		—		—		—
Multifamily		31		31		—		33		33		—
Non-owner occupied		357		306		—		394		343		—
Total commercial real estate		388		337		—		427		376		—
Residential real estate:
Senior lien		345		328		—		1,551		1,426		—
Junior lien		—		—		—		54		51		—
Total residential real estate		345		328		—		1,605		1,477		—
Consumer		—		—		—		4		4		—
Total impaired loans with no related allowance recorded	$	29,528	$	16,621	$	—	$	33,243	$	20,641	$	—
With a related allowance recorded:
Commercial:
Commercial and industrial	$	4,681	$	4,642	$	2,767	$	3,495	$	3,464	$	492
Owner occupied commercial real estate		2,585		2,336		248		957		642		2
Agriculture		938		911		35		—		—		—
Energy		6,613		6,613		3,148		11,216		6,548		1,866
Total commercial		14,817		14,502		6,198		15,668		10,654		2,360
Commercial real estate non-owner occupied:
Construction		—		—		—		—		—		—
Acquisition/development		—		—		—		—		—		—
Multifamily		—		—		—		—		—		—
Non-owner occupied		220		214		1		261		255		1
Total commercial real estate		220		214		1		261		255		1
Residential real estate:
Senior lien		7,162		6,486		36		5,646		5,016		31
Junior lien		1,634		1,391		10		1,781		1,532		14
Total residential real estate		8,796		7,877		46		7,427		6,548		45
Consumer		170		165		1		188		184		2
Total impaired loans with a related allowance recorded	$	24,003	$	22,758	$	6,246	$	23,544	$	17,641	$	2,408
Total impaired loans	$	53,531	$	39,379	$	6,246	$	56,787	$	38,282	$	2,408

The table below shows additional information regarding the average recorded investment and interest income recognized on impaired loans for the periods presented:

	For the three months ended
	June 30, 2017				June 30, 2016
	Average recorded investment		Interest income recognized		Average recorded investment		Interest income recognized
With no related allowance recorded:
Commercial:
Commercial and industrial	$	6,645	$	25	$	4,279	$	70
Owner occupied commercial real estate		3,789		23		1,825		20
Agriculture		1,454		—		1,758		—
Energy		5,680		—		—		—
Total commercial		17,568		48		7,862		90
Commercial real estate non-owner occupied:
Construction		—		—		—		—
Acquisition/development		—		—		—		—
Multifamily		—		—		—		—
Non-owner occupied		312		5		—		—
Total commercial real estate		312		5		—		—
Residential real estate:
Senior lien		330		—		1,296		8
Junior lien		—		—		134		—
Total residential real estate		330		—		1,430		8
Consumer		—		—		—		—
Total impaired loans with no related allowance recorded	$	18,210	$	53	$	9,292	$	98
With a related allowance recorded:
Commercial:
Commercial and industrial	$	4,643	$	—	$	4,144	$	—
Owner occupied commercial real estate		2,340		7		842		4
Agriculture		912		1		178		1
Energy		6,624		—		25,975		—
Total commercial		14,519		8		31,139		5
Commercial real estate non-owner occupied:
Construction		—		—		—		—
Acquisition/development		—		—		—		—
Multifamily		31		—		35		—
Non-owner occupied		216		2		814		10
Total commercial real estate		247		2		849		10
Residential real estate:
Senior lien		6,525		20		5,149		28
Junior lien		1,403		12		1,652		14
Total residential real estate		7,928		32		6,801		42
Consumer		169		—		241		—
Total impaired loans with a related allowance recorded	$	22,863	$	42	$	39,030	$	57
Total impaired loans	$	41,073	$	95	$	48,322	$	155

	For the six months ended
	June 30, 2017				June 30, 2016
	Average recorded investment		Interest income recognized		Average recorded investment		Interest income recognized
With no related allowance recorded:
Commercial:
Commercial and industrial	$	7,030	$	73	$	4,564	$	138
Owner occupied commercial real estate		3,834		41		1,869		49
Agriculture		1,531		—		1,758		—
Energy		5,889		—		—		—
Total Commercial		18,284		114		8,191		187
Commercial real estate non-owner occupied:
Construction		—		—		—		—
Acquisition/development		—		—		—		—
Multifamily		—		—		—		—
Non-owner occupied		320		12		—		—
Total commercial real estate		320		12		—		—
Residential real estate:
Senior lien		334		—		1,312		14
Junior lien		—		—		136		1
Total residential real estate		334		—		1,448		15
Consumer		—		—		—		—
Total impaired loans with no related allowance recorded	$	18,938	$	126	$	9,639	$	202
With a related allowance recorded:
Commercial:
Commercial and industrial	$	4,630	$	—	$	4,312	$	—
Owner occupied commercial real estate		2,349		11		865		7
Agriculture		914		3		179		3
Energy		6,602		—		26,005		—
Total Commercial		14,495		14		31,361		10
Commercial real estate non-owner occupied:
Construction		—		—		—		—
Acquisition/development		—		—		—		—
Multifamily		31		1		36		1
Non-owner occupied		220		5		823		24
Total commercial real estate		251		6		859		25
Residential real estate:
Senior lien		6,583		40		5,212		53
Junior lien		1,421		25		1,670		27
Total residential real estate		8,004		65		6,882		80
Consumer		175		—		242		—
Total impaired loans with a related allowance recorded	$	22,925	$	85	$	39,344	$	115
Total impaired loans	$	41,863	$	211	$	48,983	$	317

Interest income recognized on impaired loans noted in the table above primarily represents interest earned on accruing troubled debt restructurings. Interest income recognized on impaired loans during the three months ended June 30, 2017 and 2016 was $0.1 million and $0.2 million, respectively. Interest income recognized on impaired loans during the six months ended June 30, 2017 and 2016 was $0.2 million and $0.3 million, respectively.

Troubled debt restructurings

It is the Company’s policy to review each prospective credit in order to determine the appropriateness and the adequacy of security or collateral prior to making a loan. In the event of borrower default, the Company seeks recovery in compliance with lending laws, the respective loan agreements, and credit monitoring and remediation procedures that may include restructuring a loan to provide a concession by the Company to the borrower from their original terms due to borrower financial difficulties in order to facilitate repayment. Additionally, if a borrower’s repayment obligation has been discharged by a court, and that debt has not been reaffirmed by the borrower, regardless of past due status, the loan is considered to be a TDR. At June 30, 2017 and December 31, 2016, the Company had $5.2 million and $5.8 million, respectively, of accruing TDRs that had been restructured from the original terms in order to facilitate repayment.

Non-accruing TDRs at June 30, 2017 and December 31, 2016 totaled $21.7 million and $16.7 million, respectively.

During the six months ended June 30, 2017, the Company restructured five loans with a recorded investment of $6.8 million at June 30, 2017. Substantially all of the loan modifications were a reduction of the principal payment, a reduction in interest rate, or an extension of term. Loan modifications to loans accounted for under ASC 310-30 are not considered TDRs. The table below provides additional information related to accruing TDRs at June 30, 2017 and December 31, 2016:

	June 30, 2017
	Recorded		Average year-to-date		Unpaid		Unfunded commitments
	investment		recorded investments		principal balance		to fund TDRs
Commercial	$	3,258	$	3,270	$	3,488	$	100
Commercial real estate non-owner occupied		491		510		543		—
Residential real estate		1,424		1,450		1,435		2
Consumer		4		5		4		—
Total	$	5,177	$	5,235	$	5,470	$	102

	December 31, 2016
	Recorded		Average year-to-date		Unpaid		Unfunded commitments
	investment		recorded investments		principal balance		to fund TDRs
Commercial	$	3,302	$	3,440	$	3,464	$	100
Commercial real estate non-owner occupied		538		572		590		—
Residential real estate		1,920		1,996		1,969		2
Consumer		7		9		7		—
Total	$	5,767	$	6,017	$	6,030	$	102

The following table summarizes the Company’s carrying value of non-accrual TDRs as of June 30, 2017 and December 31, 2016:

	June 30, 2017		December 31, 2016
Commercial	$	20,246	$	15,265
Commercial real estate non-owner occupied		—		—
Residential real estate		1,308		1,301
Consumer		127		142
Total non-accruing TDRs	$	21,681	$	16,708

Accrual of interest is resumed on loans that were on non-accrual only after the loan has performed sufficiently. The Company had three TDRsthat were modified within the past twelve months and had defaulted on their restructured terms during the three months ended June 30, 2017, and five TDRs that were modified within the past twelve months and had defaulted on their restructured terms during the six months ended June 30, 2017. The defaulted TDRs consisted of one energy sector loan totaling $2.9 million, three commercial and industrial loans totaling $4.2 million and one small senior lien loan. The allowance for loan losses related to troubled debt restructurings on non-accrual status is determined by individual evaluation, including collateral adequacy, using the same process as loans on non-accrual status which are not classified as troubled debt restructurings.

During the three and six months ended June 30, 2016, the Company had one and five TDRs that had been modified within the past 12 months that defaulted on their restructured terms, respectively. For purposes of this disclosure, the Company considers “default” to mean 90 days or more past due on principal or interest.

Loans accounted for under ASC 310-30

Loan pools accounted for under ASC Topic 310-30 are periodically re-measured to determine expected future cash flows. In determining the expected cash flows, the timing of cash flows and prepayment assumptions for smaller homogeneous loans are based on statistical models that take into account factors such as the loan interest rate, credit profile of the borrowers, the years in which the loans were originated, and whether the loans are fixed or variable rate loans. Prepayments may be assumed on loans if circumstances specific to that loan warrant a prepayment assumption. The re-measurement of loans accounted for under ASC 310-30 resulted in the following changes in the carrying amount of accretable yield during the six months ended June 30, 2017 and 2016:

	June 30, 2017		June 30, 2016
Accretable yield beginning balance	$	60,476	$	84,194
Reclassification from non-accretable difference		7,732		5,646
Reclassification to non-accretable difference		(494)		(4,019)
Accretion		(12,051)		(18,056)
Accretable yield ending balance	$	55,663	$	67,765

Below is the composition of the net book value for loans accounted for under ASC 310-30 at June 30, 2017 and December 31, 2016:

	June 30, 2017		December 31, 2016
Contractual cash flows	$	514,149	$	537,611
Non-accretable difference		(324,059)		(331,283)
Accretable yield		(55,663)		(60,476)
Loans accounted for under ASC 310-30	$	134,427	$	145,852

XML

Allowance for Loan Losses

6 Months Ended

Jun. 30, 2017

Receivables [Abstract]

Allowance for Loan Losses

Note 5 Allowance for Loan Losses

The tables below detail the Company’s allowance for loan losses (“ALL”) and recorded investment in loans as of and for the three and six months ended June 30, 2017 and 2016:

	Three months ended  June 30, 2017
			Non-owner
			occupied
			commercial		Residential
	Commercial		real estate		real estate		Consumer		Total
Beginning balance	$	20,539	$	5,815	$	4,216	$	280	$	30,850
Non 310-30 beginning balance		20,539		5,599		4,216		276		30,630
Charge-offs		—		—		(2)		(119)		(121)
Recoveries		30		10		110		55		205
Provision		4,087		191		(257)		82		4,103
Non 310-30 ending balance		24,656		5,800		4,067		294		34,817
ASC 310-30 beginning balance		—		216		—		4		220
Charge-offs		—		—		—		—		—
Recoveries		—		—		—		—		—
(Recoupment) provision		—		(82)		—		4		(78)
ASC 310-30 ending balance		—		134		—		8		142
Ending balance	$	24,656	$	5,934	$	4,067	$	302	$	34,959

	Three months ended  June 30, 2016
			Non-owner
			occupied
			commercial		Residential
	Commercial		real estate		real estate		Consumer		Total
Beginning balance	$	28,684	$	3,861	$	4,325	$	296	$	37,166
Non 310-30 beginning balance		28,610		3,803		4,289		249		36,951
Charge-offs		(3,375)		—		(140)		(171)		(3,686)
Recoveries		12		56		16		126		210
Provision		4,733		1,298		339		30		6,400
Non 310-30 ending balance		29,980		5,157		4,504		234		39,875
ASC 310-30 beginning balance		74		58		36		47		215
Charge-offs		—		(41)		—		—		(41)
Recoveries		—		—		—		—		—
(Recoupment) provision		(72)		194		(36)		(29)		57
ASC 310-30 ending balance		2		211		—		18		231
Ending balance	$	29,982	$	5,368	$	4,504	$	252	$	40,106

	Six months ended June 30, 2017
			Non-owner
			occupied
			commercial		Residential
	Commercial		real estate		real estate		Consumer		Total
Beginning balance	$	18,821	$	5,642	$	4,387	$	324	$	29,174
Non 310-30 beginning balance		18,821		5,422		4,387		319		28,949
Charge-offs		(20)		—		(10)		(301)		(331)
Recoveries		41		20		113		122		296
Provision		5,814		358		(423)		154		5,903
Non 310-30 ending balance		24,656		5,800		4,067		294		34,817
ASC 310-30 beginning balance		—		220		—		5		225
Charge-offs		—		—		—		—		—
Recoveries		—		—		—		—		—
(Recoupment) provision		—		(86)		—		3		(83)
ASC 310-30 ending balance		—		134		—		8		142
Ending balance	$	24,656	$	5,934	$	4,067	$	302	$	34,959
Ending allowance balance attributable to:
Non 310-30 loans individually evaluated for impairment	$	6,197	$	1	$	45	$	1	$	6,244
Non 310-30 loans collectively evaluated for impairment		18,459		5,799		4,022		293		28,573
ASC 310-30 loans		—		134		—		8		142
Total ending allowance balance	$	24,656	$	5,934	$	4,067	$	302	$	34,959
Loans:
Non 310-30 individually evaluated for impairment	$	30,458	$	551	$	8,205	$	165	$	39,379
Non 310-30 collectively evaluated for impairment		1,709,018		472,684		706,294		26,143		2,914,139
ASC 310-30 loans		35,978		83,785		14,012		652		134,427
Total loans	$	1,775,454	$	557,020	$	728,511	$	26,960	$	3,087,945

	Six months ended June 30, 2016
			Non-owner
			occupied
			commercial		Residential
	Commercial		real estate		real estate		Consumer		Total
Beginning balance	$	17,261	$	4,166	$	5,281	$	411	$	27,119
Non 310-30 beginning balance		16,473		3,939		5,245		385		26,042
Charge-offs		(3,484)		(276)		(197)		(388)		(4,345)
Recoveries		24		65		23		185		297
Provision		16,967		1,429		(567)		52		17,881
Non 310-30 ending balance		29,980		5,157		4,504		234		39,875
ASC 310-30 beginning balance		788		227		36		26		1,077
Charge-offs		—		(41)		—		—		(41)
Recoveries		—		—		—		—		—
(Recoupment) provision		(786)		25		(36)		(8)		(805)
ASC 310-30 ending balance		2		211		—		18		231
Ending balance	$	29,982	$	5,368	$	4,504	$	252	$	40,106
Ending allowance balance attributable to:
Non 310-30 loans individually evaluated for impairment	$	14,933	$	3	$	39	$	2	$	14,977
Non 310-30 loans collectively evaluated for impairment		15,047		5,154		4,465		232		24,898
ASC 310-30 loans		2		211		—		18		231
Total ending allowance balance	$	29,982	$	5,368	$	4,504	$	252	$	40,106
Loans:
Non 310-30 individually evaluated for impairment	$	37,265	$	842	$	7,369	$	240	$	45,716
Non 310-30 collectively evaluated for impairment		1,406,609		423,178		667,461		26,258		2,523,506
ASC 310-30 loans		46,875		101,719		19,341		1,347		169,282
Total loans	$	1,490,749	$	525,739	$	694,171	$	27,845	$	2,738,504

In evaluating the loan portfolio for an appropriate ALL level, non-impaired loans that were not accounted for under ASC 310-30 were grouped into segments based on broad characteristics such as primary use and underlying collateral. Within the segments, the portfolio was further disaggregated into classes of loans with similar attributes and risk characteristics for purposes of applying loss ratios and determining applicable subjective adjustments to the ALL. The application of subjective adjustments was based upon qualitative risk factors, including economic trends and conditions, industry conditions, asset quality, loss trends, lending management, portfolio growth and loan review/internal audit results.

Net charge-offs on non 310-30 loans during the three and six months ended June 30, 2017 were $0.1 million and $0.0 million, respectively. Management's evaluation of credit quality resulted in a provision for loan losses on the non 310-30 loans of $4.1 million and $5.9 million during the three and six months ended June 30, 2017, respectively. Provision for the three months ended June 30, 2017 included specific reserves of $2.1 million on one commercial loan and general reserves on net loan growth. Provision for the six months ended June 30, 2017 included specific reserves totaling $3.4 million on one energy sector and one commercial sector loan.

During the six months ended June 30, 2017, the Company re-estimated the expected cash flows of the loan pools accounted for under ASC 310-30. The re-measurement resulted in a net recoupment of $78 thousand and $83 thousand for the three and six months ended June 30, 2017, respectively. The net recoupment was primarily due to a recoupment of $82 thousand in the non-owner occupied commercial real estate segment during the three months ended June 30, 2017, and primarily due to a recoupment of $86 thousand in the non-owner occupied commercial real estate segment for the six months ended June 30, 2017.

Net charge-offs on non 310-30 loans during the three and six months ended June 30, 2016 were $3.5 million and $4.0 million, respectively. Management’s evaluation resulted in a provision for loan losses on the non 310-30 loans of $6.4 million and $17.9 million during the three and six months ended June 30, 2016, respectively. The increase in provision was driven by a $4.3 million increase in reserves against the energy sector portfolio for the three months ended June 30, 2016 and a net $15.1 million increase for the six months ended June 30, 2016.

During the six months ended June 30, 2016, the Company re-estimated the expected cash flows of the loan pools accounted for under ASC 310-30. The re-measurement resulted in a net provision of $57 thousand and a net recoupment of $805 thousand for the three and six months ended June 30, 2016, respectively, which was comprised primarily of a provision of $195 thousand in the non-owner occupied commercial real estate segment, partially offset by recoupments of $73 thousand and $3 thousand in the commercial real estate and residential real estate segments, respectively, for the three months ended June 30, 2016, and primarily a recoupment of $786 thousand in the commercial segment for the six months ended June 30, 2016. 

XML

Other Real Estate Owned

6 Months Ended

Jun. 30, 2017

FDIC Loss-Sharing Related

Other Real Estate Owned

Note 6 Other Real Estate Owned

The table below details the OREO activity during the six months ended June 30, 2017 and 2016:

	For the six months ended June 30,
	2017		2016
Beginning balance	$	15,662	$	20,814
Transfers from loan portfolio, at fair value		639		3,654
Impairments		(46)		(104)
Sales, net		(1,958)		(1,122)
Ending balance	$	14,297	$	23,242

The Company did not have any minority interest in participated other real estate owned at June 30, 2017. At December 31, 2016, OREO balances excluded $1.6 million of the Company’s minority interests in OREO, which are held by outside banks where the Company was not the lead bank and does not have a controlling interest. The Company maintains a receivable in other assets for these minority interests. Included in Sales, net are net gains of $1.8 million and $2.0 million for the six months ended June 30, 2017 and 2016, respectively.

XML

Borrowings

6 Months Ended

Jun. 30, 2017

Disclosure of Repurchase Agreements [Abstract]

Borrowings

Note 7 Borrowings

As of June 30, 2017 and December 31, 2016, the Company sold securities under agreements to repurchase totaling $119.2 million and $92.0 million, respectively, and none were for periods longer than one day. The Company pledged mortgage-backed securities with a fair value of approximately $123.4 million and $99.1 million as of June 30, 2017 and December 31, 2016, respectively, for these agreements. The Company monitors collateral levels on a continuous basis and may be required to provide additional collateral based on the fair value of the underlying securities. As of June 30, 2017 and December 31, 2016, the Company had $4.2 million and $7.0 million of excess collateral pledged for repurchase agreements. The repurchase agreements are subject to a master netting arrangement; however, the Company has not offset any of the amounts presented in the consolidated financial statements.

As a member of the FHLB, the Bank has access to a line of credit and term financing from the FHLB with total available credit of $763.6 million at June 30, 2017. At June 30, 2017 and December 31, 2016, the Bank had $129.1 million and $25.0 million in term advances from the FHLB, respectively. The term advances have fixed interest rates of 1.31% - 2.33%, with maturity dates of 2018 - 2020. The Bank had investment securities pledged as collateral for FHLB advances in the amount of $26.1 million at June 30, 2017 and $28.8 million at December 31, 2016. Interest expense related to FHLB advances totaled $496 thousand and $693 thousand for the three and six months ended June 30, 2017, respectively, and $166 thousand and $332 thousand for the three and six months ended June 30, 2016, respectively.

XML

Regulatory Capital

6 Months Ended

Jun. 30, 2017

FDIC Loss-Sharing Related

Regulatory Capital

Note 8 Regulatory Capital

As a bank holding company, the Company is subject to regulatory capital adequacy requirements implemented by the Federal Reserve. The federal banking agencies have risk-based capital adequacy regulations intended to provide a measure of capital adequacy that reflects the degree of risk associated with a banking organization’s operations. Under these regulations, assets are assigned to one of several risk categories, and nominal dollar amounts of assets and credit equivalent amounts of off-balance-sheet items are multiplied by a risk adjustment percentage for the category.

The new Basel III rules, effective January 1, 2015, changed the components of regulatory capital and changed the way in which risk ratings are assigned to various categories of bank assets. Also, a new Tier I common risk-based ratio was defined. Under the Basel III requirements, at June 30, 2017, the Company and the Bank met all capital requirements and the Bank had regulatory capital ratios in excess of the levels established for well-capitalized institutions.

At June 30, 2017 and December 31, 2016, the Bank met the requirements to be considered “well capitalized” under the regulatory framework for prompt corrective action. To be categorized as “well-capitalized”, the Bank must maintain capital ratios as set forth in the table below. The following table sets forth the capital ratios of the Company and the Bank at June 30, 2017 and December 31, 2016.

	June 30, 2017
				Required to be			Required to be
				well capitalized under			considered
				prompt corrective			adequately
	Actual			action provisions			capitalized
	Ratio	Amount		Ratio	Amount		Ratio	Amount
Tier 1 leverage ratio:
Consolidated	10.3%	$	472,627	N/A		N/A	4.0%	$	184,402
NBH Bank	8.4%		385,466	4.5%	$	206,721	4.0%		183,752
Common equity tier 1 risk-based capital:
Consolidated	13.3%	$	472,627	N/A		N/A	4.5%	$	207,452
NBH Bank	10.9%		385,466	6.5%	$	298,597	4.5%		206,721
Tier 1 risk-based capital ratio:
Consolidated	13.3%	$	472,627	N/A		N/A	6.0%	$	213,366
NBH Bank	10.9%		385,466	8.0%	$	283,313	6.0%		212,485
Total risk-based capital ratio:
Consolidated	14.3%	$	507,912	N/A		N/A	8.0%	$	284,488
NBH Bank	11.9%		420,750	10.0%	$	354,141	8.0%		283,313

	December 31, 2016
				Required to be			Required to be
				well capitalized under			considered
				prompt corrective			adequately
	Actual			action provisions			capitalized
	Ratio	Amount		Ratio	Amount		Ratio	Amount
Tier 1 leverage ratio:
Consolidated	10.4%	$	470,259	N/A		N/A	4.0%	$	181,019
NBH Bank	8.6%		389,189	4.5%	$	202,903	4.0%		180,358
Common equity tier 1 risk-based capital:
Consolidated	14.2%	$	470,259	N/A		N/A	4.5%	$	203,647
NBH Bank	11.8%		389,189	6.5%	$	293,082	4.5%		202,903
Tier 1 risk-based capital ratio:
Consolidated	14.2%	$	470,259	N/A		N/A	6.0%	$	199,467
NBH Bank	11.8%		389,189	8.0%	$	264,596	6.0%		198,447
Total risk-based capital ratio:
Consolidated	15.0%	$	499,759	N/A		N/A	8.0%	$	265,955
NBH Bank	12.7%		418,689	10.0%	$	330,745	8.0%		264,596

XML

Stock-based Compensation and Benefits

6 Months Ended

Jun. 30, 2017

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-based Compensation and Benefits

Note 9 Stock-based Compensation and Benefits

The Company provides stock-based compensation in accordance with shareholder-approved plans. During the second quarter of 2014, shareholders approved the 2014 Omnibus Incentive Plan (the "2014 Plan"). The 2014 Plan replaces the NBH Holdings Corp. 2009 Equity Incentive Plan (the "Prior Plan"), pursuant to which the Company granted equity awards prior to the approval of the 2014 Plan. Pursuant to the 2014 Plan, the Compensation Committee of the Board of Directors has the authority to grant, from time to time, awards of stock options, stock appreciation rights, restricted stock, restricted stock units, performance units, other stock-based awards, or any combination thereof to eligible persons.

Stock options

The Company issued stock options during the six months ended June 30, 2017 and 2016, which are primarily time-vesting with 1/3 vesting on each of the first, second and third anniversary of the date of grant or date of hire.

The expense associated with the awarded stock options was measured at fair value using a Black-Scholes option-pricing model. The outstanding unvested option awards vest on a graded basis over 1-3 years of continuous service and have 7-10 year contractual terms.

The Company issued stock options in accordance with the 2014 Plan during 2017. The following table summarizes stock option activity for the six months ended June 30, 2017:

				Weighted
				average
		Weighted		remaining
		average		contractual	Aggregate
		exercise		term in	intrinsic
	Options	price		years	value
Outstanding at December 31, 2016	2,185,922	$	19.81	4.85	$	7,753
Granted	99,920		33.98
Exercised	(585,750)		19.93
Forfeited	(16,225)		21.84
Outstanding at June 30, 2017	1,683,867	$	20.61	4.52	$	21,136
Options exercisable at June 30, 2017	1,429,584	$	19.80	3.77	$	19,021
Options expected to vest	1,662,690	$	20.53	4.46	$	20,994

Stock option expense is a component of salaries and benefits in the consolidated statements of operations and totaled $0.2 million for the three months ended June 30, 2017 and 2016, and $0.4 million for the six months ended June 30, 2017 and 2016, respectively. At June 30, 2017, there was $0.8 million of total unrecognized compensation cost related to non-vested stock options granted under the plans. The cost is expected to be recognized over a weighted average period of 2.4 years.

Restricted stock awards

The Company issued time based restricted stock awards during the six months ended June 30, 2017 and 2016. The restricted stock awards vest over a range of a 1 - 3 year period. Restricted stock with time-based vesting was valued at the fair value of the shares on the date of grant as they are assumed to be held beyond the vesting period.

No market-based stock awards were granted during the six months ended June 30, 2017. During six months ended June 30, 2016, the Company granted market-based awards of 26,594 shares in accordance with the 2014 Plan. These shares have a five-year performance period. The restricted stock shares vest upon the later of the Company’s stock price achieving an established price goal during the performance period, and the third anniversary of the date of grant. The fair value of these awards was determined using a Monte Carlo Simulation at grant date. The grant date fair value of these awards was $11.28. As of June 30, 2017, the market-based performance condition had been met for these awards and the total unrecognized compensation cost related to non-vested awards totaled $0.3 million, and is expected to be recognized over a weighted average period of approximately 1.9 years.

Performance stock units

During the six months ended June 30, 2017 and 2016, the Company granted 49,758 and 91,342 performance stock units in accordance with the 2014 Plan, respectively. These performance stock units granted represent initial target awards and do not reflect potential increases or decreases resulting from the final performance results, which are to be determined at the end of the three-year performance period (vesting date). The actual number of shares to be awarded at the end of the performance period will range from 0% - 150% of the initial target awards. 60% of the award is based on the Company’s cumulative earnings per share (EPS target) during the performance period, and 40% of the award is based on the Company’s cumulative total shareholder return (TSR target), or TSR, during the performance period. On the vesting date, the Company’s TSR will be compared to the respective TSRs of the companies comprising the KBW Regional Index at the grant date to determine the shares awarded. The fair value of the EPS target portion of the award was determined based on the closing stock price of the Company’s common stock on the grant date. The fair value of the TSR target portion of the award was determined using a Monte Carlo Simulation at the grant date. The weighted-average grant date fair value per unit for awards granted during the six months ended June 30, 2017 of the EPS target portion and the TSR target portion was $34.04 and $32.06, respectively.

The following table summarizes restricted stock and performance stock activity during the six months ended June 30, 2017:

		Weighted				Weighted
	Restricted	average grant-		Performance		average grant-
	shares	date fair value		stock units		date fair value
Unvested at December 31, 2016	499,271	$	15.82	85,295	$	18.22
Granted	65,990		33.43	49,758		33.22
Vested	(298,086)		15.27	—		—
Forfeited	(11,111)		22.23	(5,994)		20.90
Unvested at June 30, 2017	256,064	$	20.82	129,059	$	23.88

As of June 30, 2017, the total unrecognized compensation cost related to non-vested restricted stock awards and units totaled $4.5 million, and is expected to be recognized over a weighted average period of approximately 2.1 years. Expense related to non-vested restricted awards and units totaled $0.8 million and $0.7 million during the three months ended June 30, 2017 and 2016, respectively, and $1.4 million during the six months ended June 30, 2017 and 2016, and is a component of salaries and benefits in the Company’s consolidated statements of operations.

Employee Stock Purchase Plan

The 2014 Employee Stock Purchase Plan (“ESPP”) is intended to be a qualified plan within the meaning of Section 423 of the Internal Revenue Code of 1986 and allows eligible employees to purchase shares of common stock through payroll deductions up to a limit of $25,000 per calendar year and 2,000 shares per offering period. The price an employee pays for shares is 90.0% of the fair market value of Company common stock on the last day of the offering period. The offering period is the six-month period commencing on March 1 and September 1 of each year and ending on August 31 and February 28 (or February 29 in the case of a leap year) of each year. There is no vesting or other restrictions on the stock purchased by employees under the ESPP. Under the ESPP, the total number of shares of common stock reserved for issuance totaled 400,000 shares, of which 360,963 were available for issuance.

Under the ESPP, employees purchased 5,373 shares during the six months ended June 30, 2017.

XML

Warrants

6 Months Ended

Jun. 30, 2017

Warrants and Rights Note Disclosure [Abstract]

Warrants

Note 10 Warrants

During the first quarter of 2017, 250,750 warrants were exercised in a non-cash transaction, representing the remaining outstanding warrants. The warrants were granted to certain lead shareholders of the Company at the time of the Company’s initial capital raise (2009-2010), all with an exercise price of $20.00 per share. Refer to the consolidated statements of changes in shareholders’ equity for additional detail.

XML

Common Stock

6 Months Ended

Jun. 30, 2017

Equity [Abstract]

Common Stock

Note 11 Common Stock

The Company had 26,788,833 and 26,386,583 shares of Class A common stock outstanding at June 30, 2017 and December 31, 2016, respectively. Additionally, the Company had 256,064 and 499,271 shares outstanding at June 30, 2017 and December 31, 2016, respectively, of restricted Class A common stock issued but not yet vested under the 2014 Omnibus Incentive Plan and the Prior Plan that are not included in shares outstanding until such time that they are vested; however, these shares do have voting and certain dividend rights during the vesting period.

On August 5, 2016, the Board of Directors authorized a new share repurchase program for up to $50.0 million from time to time in either the open market or through privately negotiated transactions. The remaining authorization under this program as of June 30, 2017 was $12.6 million.

XML

Income Per Share

6 Months Ended

Jun. 30, 2017

Earnings Per Share [Abstract]

Income Per Share

Note 12 Income Per Share

The Company calculates income per share under the two-class method, as certain non-vested share awards contain non-forfeitable rights to dividends. As such, these awards are considered securities that participate in the earnings of the Company. Non-vested shares are discussed further in note 9.

The Company had 26,788,833 and 28,810,883 shares of Class A common stock outstanding as of June 30, 2017 and 2016, respectively, exclusive of issued non-vested restricted shares. Certain stock options and non-vested restricted shares are potentially dilutive securities, but are not included in the calculation of diluted income per share because to do so would have been anti-dilutive for the three and six months ended June 30, 2017 and 2016.

The following table illustrates the computation of basic and diluted income per share for the three and six months ended June 30, 2017 and 2016:

	For the three months ended				For the six months ended
	June 30, 2017		June 30, 2016		June 30, 2017		June 30, 2016
Net income	$	9,209	$	4,504	$	17,467	$	4,755
Less: income allocated to participating securities		(14)		(12)		(30)		(25)
Income allocated to common shareholders	$	9,195	$	4,492	$	17,437	$	4,730
Weighted average shares outstanding for basic income per common share		26,955,187		29,215,822		26,878,904		29,666,570
Dilutive effect of equity awards		642,256		49,461		742,001		37,643
Dilutive effect of warrants		—		13,476		16,627		3,166
Weighted average shares outstanding for diluted income per common share		27,597,443		29,278,759		27,637,532		29,707,379
Basic income per share	$	0.34	$	0.15	$	0.65	$	0.16
Diluted income per share	$	0.33	$	0.15	$	0.63	$	0.16

The Company had 1,683,867 and 2,703,752 outstanding stock options to purchase common stock at weighted average exercise prices of $20.61 and $19.82 per share at June 30, 2017 and 2016, respectively, which have time-vesting criteria, and as such, any dilution is derived only for the time frame in which the vesting criteria had been met and where the inclusion of those stock options is dilutive. Additionally, 250,750 warrants were exercised in a non-cash transaction during the first quarter of 2017, representing the remaining outstanding warrants to purchase shares of the Company’s common stock. The warrants had an exercise price of $20.00, which were in-the-money for purposes of the dilution calculations during the six months ended June 30, 2017, and three and six months ended June 30, 2016. The Company had 256,064 and 918,890 unvested restricted shares and units issued as of June 30, 2017 and 2016, respectively, which have performance, market and/or time-vesting criteria, and as such, any dilution is derived only for the time frame in which the vesting criteria had been met and where the inclusion of those restricted shares and units is dilutive.

XML

Income Taxes

6 Months Ended

Jun. 30, 2017

Income Tax Disclosure [Abstract]

Income Taxes

Note 13 Income Taxes

The effective income tax rate for the three and six months ended June 30, 2017 was an expense of 19.10% and 5.1%, respectively, compared to an expense of 17.9% and 19.8% for the three and six months ended June 30, 2016, calculated based on a full year forecast method. The tax expense recorded for the three and six months ended June 30, 2017 was lowered by a $0.5 million and $3.4 million tax benefit from stock compensation activity during the respective periods. Without the discrete items related to stock compensation activity, the three and six month ended June 30, 2017 effective tax rate was consistent period-to-period. The quarterly tax rate differs from the federal statutory rate primarily due to tax benefits from stock compensation activity, interest income from tax-exempt lending, bank-owned life insurance income, and the relationship of these items to pre-tax income. See management’s discussion and analysis for further information.

XML

Derivatives

6 Months Ended

Jun. 30, 2017

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives

Note 14 Derivatives

Risk management objective of using derivatives

The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company has established policies that neither carrying value nor fair value at risk should exceed established guidelines. The Company has designed strategies to confine these risks within the established limits and identify appropriate trade-offs in the financial structure of its balance sheet. These strategies include the use of derivative financial instruments to help achieve the desired balance sheet repricing structure while meeting the desired objectives of its clients. Currently, the Company employs certain interest rate swaps that are designated as fair value hedges as well as economic hedges. The Company manages a matched book with respect to its derivative instruments in order to minimize its net risk exposure resulting from such transactions.

Fair values of derivative instrument on the balance sheet

The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the consolidated statements of financial condition as of June 30, 2017 and December 31, 2016.

Information about the valuation methods used to measure fair value is provided in note 16.

		Asset derivatives fair value					Liability derivatives fair value
	Balance Sheet	June 30,		December 31,		Balance Sheet	June 30,		December 31,
	location	2017		2016		location	2017		2016
Derivatives designated as hedging instruments:
Interest rate products	Other assets	$	8,310	$	9,528	Other liabilities	$	2,268	$	1,381
Total derivatives designated as hedging instruments		$	8,310	$	9,528		$	2,268	$	1,381
Derivatives not designated as hedging instruments:
Interest rate products	Other assets	$	2,384	$	1,900	Other liabilities	$	2,461	$	1,898
Interest rate lock commitments	Other assets		143		149	Other liabilities		—		6
Forward contracts	Other assets		14		138	Other liabilities		26		20
Total derivatives not designated as hedging instruments		$	2,541	$	2,187		$	2,487	$	2,085

Fair value hedges

Interest rate swaps designated as fair value hedges involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without the exchange of the underlying notional amount. As of June 30, 2017, the Company had 52 interest rate swaps with a notional amount of $372.1 million that were designated as fair value hedges of interest rate risk associated with the Company’s fixed-rate loans. As of December 31, 2016, the Company had 42 interest rate swaps with a notional amount of $313.0 million that were designated as fair value hedges. 

For derivatives designated and that qualify as fair value hedges, the gain or loss on the derivative as well as the offsetting loss or gain on the hedged item attributable to the hedged risk are recognized in earnings. The Company includes the gain or loss on the hedged items in the same line item as the offsetting loss or gain on the related derivatives. During the three and six months ended June 30, 2017, the Company recognized a net loss of $207 thousand and $385 thousand, respectively, in non-interest income related to hedge ineffectiveness. During the three and six months ended June 30 2016, the Company recognized a net loss of $462 thousand and $1.1 million, respectively, in non-interest income related to hedge ineffectiveness.

Non-designated hedges

Derivatives not designated as hedges are not speculative and consist of interest rate swaps with commercial banking clients that facilitate their respective risk management strategies. Interest rate swaps are simultaneously hedged by offsetting interest rate swaps that the Company executes with a third party, such that the Company minimizes its net risk exposure resulting from such transactions. As the interest rate swaps associated with this program do not meet the strict hedge accounting requirements, changes in the fair value of both the client swaps and the offsetting swaps are recognized directly in earnings. As of June 30, 2017, the Company had 39 matched interest rate swap transactions with an aggregate notional amount of $161.3 million related to this program. As of December 31, 2016, the Company had 36 matched interest rate swap transactions with an aggregate notional amount of $132.6 million related to this program. 

As part of its mortgage banking activities, the Company enters into interest rate lock commitments, which are commitments to originate loans where the interest rate on the loan is determined prior to funding and the customers have locked into that interest rate. The Company then locks in the loan and interest rate with an investor and commits to deliver the loan if settlement occurs ("best efforts") or commits to deliver the locked loan in a binding ("mandatory") delivery program with an investor. Fair value changes of certain loans under interest rate lock commitments are hedged with forward sales contracts of MBS. Forward sales contracts of MBS are recorded at fair value with changes in fair value recorded in non-interest income. Interest rate lock commitments and commitments to deliver loans to investors are considered derivatives. The market value of interest rate lock commitments and best efforts contracts are not readily ascertainable with precision because they are not actively traded in stand-alone markets. The Company determines the fair value of interest rate lock commitments and delivery contracts by measuring the fair value of the underlying asset, which is impacted by current interest rates, taking into consideration the probability that the interest rate lock commitments will close or will be funded.

Certain additional risks arise from these forward delivery contracts in that the counterparties to the contracts may not be able to meet the terms of the contracts. The Company does not expect any counterparty to any MBS contract to fail to meet its obligation. Additional risks inherent in mandatory delivery programs include the risk that, if the Company fails to deliver the loans subject to interest rate risk lock commitments, it will still be obligated to “pair off” MBS to the counterparty. Should this be required, the Company could incur significant costs in acquiring replacement loans and such costs could have an adverse effect on the consolidated financial statements.

The fair value of the mortgage banking derivative is recorded as a freestanding asset or liability with the change in value being recognized in current earnings during the period of change.

The Company had 59 interest rate lock commitments with a notional value of $12.4 million and nine forward contracts with a notional value of $10.0 million at June 30, 2017. At December 31, 2016, the Company had 78 interest rate lock commitments, with a notional value of $13.8 million, and eleven forward contracts with a notional value of $11.8 million.

Effect of derivative instruments on the consolidated statements of operations

The tables below present the effect of the Company’s derivative financial instruments on the consolidated statements of operations for the three and six months ended June 30, 2017 and 2016:

	Location of gain (loss)	Amount of gain (loss) recognized in income on derivatives
Derivatives in fair value	recognized in income on	For the three months ended June 30,				For the six months ended June 30,
hedging relationships	derivatives	2017		2016		2017		2016
Interest rate products	Other non-interest income	$	(3,169)	$	(6,513)	$	(2,105)	$	(17,414)
Total		$	(3,169)	$	(6,513)	$	(2,105)	$	(17,414)

	Location of gain (loss)	Amount of gain (loss) recognized in income on hedged items
	recognized in income on	For the three months ended June 30,				For the six months ended June 30,
Hedged items	hedged items	2017		2016		2017		2016
Interest rate products	Other non-interest income	$	2,962	$	6,051	$	1,720	$	16,281
Total		$	2,962	$	6,051	$	1,720	$	16,281

	Location of gain (loss)	Amount of gain (loss) recognized in income on derivatives
Derivatives not designated	recognized in income on	For the three months ended June 30,				For the six months ended June 30,
as hedging instruments	derivatives	2017		2016		2017		2016
Interest rate products	Other non-interest expense	$	(47)	$	(89)	$	(79)	$	(183)
Interest rate lock commitments	Gain on sale of mortgages, net		(122)		332		1		332
Forward contracts	Gain on sale of mortgages, net		63		(178)		(131)		(178)
Total		$	(106)	$	65	$	(209)	$	(29)

Credit-risk-related contingent features

The Company has agreements with its derivative counterparties that contain a provision where if the Company defaults on any of its indebtedness for reasons other than an error or omission of an administrative or operational nature, including default where repayment of the indebtedness has not been accelerated by the lender, then the Company could also be declared in default on its derivative obligations.

The Company also has agreements with certain of its derivative counterparties that contain a provision where if the Company fails to maintain its status as a well/adequately capitalized institution, then the counterparty has the right to terminate the derivative positions and the Company would be required to settle its obligations under the agreements.

As of June 30, 2017 and December 31, 2016, the termination value of derivatives in a net liability position related to these agreements was $1.1 million and $1.3 million, respectively, which includes accrued interest but excludes any adjustment for nonperformance risk. The Company has minimum collateral posting thresholds with certain of its derivative counterparties and as of June 30, 2017 and December 31, 2016, the Company had posted $2.8 million and $0.8 million, respectively, in eligible collateral. If the Company had breached any of these provisions at June 30, 2017, it could have been required to settle its obligations under the agreements at the termination value.

XML

Commitments and Contingencies

6 Months Ended

Jun. 30, 2017

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Note 15 Commitments and Contingencies

In the normal course of business, the Company enters into various off-balance sheet commitments to help meet the financing needs of clients. These financial instruments include commitments to extend credit, commercial and consumer lines of credit and standby letters of credit. The same credit policies are applied to these commitments as the loans on the consolidated statements of financial condition; however, these commitments involve varying degrees of credit risk in excess of the amount recognized in the consolidated statements of financial condition. At June 30, 2017 and December 31, 2016, the Company had loan commitments totaling $648.2 million and $602.2 million, respectively, and standby letters of credit that totaled $15.0 million and $13.5 million, respectively. The total amounts of unused commitments do not necessarily represent future credit exposure or cash requirements, as commitments often expire without being drawn upon. However, the contractual amount of these commitments, offset by any additional collateral pledged, represents the Company’s potential credit loss exposure.

Total unfunded commitments at June 30, 2017 and December 31, 2016 were as follows:

	June 30, 2017		December 31, 2016
Commitments to fund loans	$	181,052	$	149,391
Unfunded commitments under lines of credit		467,180		452,851
Commercial and standby letters of credit		15,030		13,532
Total unfunded commitments	$	663,262	$	615,774

Commitments to fund loans—Commitments to fund loans are legally binding agreements to lend to clients in accordance with predetermined contractual provisions providing there have been no violations of any conditions specified in the contract. These commitments are generally at variable interest rates and are for specific periods or contain termination clauses and may require the payment of a fee. The total amounts of unused commitments are not necessarily representative of future credit exposure or cash requirements, as commitments often expire without being drawn upon.

Unfunded commitments under lines of credit—In the ordinary course of business, the Company extends revolving credit to its clients. These arrangements may require the payment of a fee.

Commercial and standby letters of credit—As a provider of financial services, the Company routinely issues commercial and standby letters of credit, which may be financial standby letters of credit or performance standby letters of credit. These are various forms of “back-up” commitments to guarantee the performance of a client to a third party. While these arrangements represent a potential cash outlay for the Company, the majority of these letters of credit will expire without being drawn upon. Letters of credit are subject to the same underwriting and credit approval process as traditional loans, and as such, many of them have various forms of collateral securing the commitment, which may include real estate, personal property, receivables or marketable securities.

Contingencies

In the ordinary course of business, the Company and the Bank may be subject to litigation. Based upon the available information and advice from the Company’s legal counsel, management does not believe that any potential, threatened or pending litigation to which it is a party will have a material adverse effect on the Company’s liquidity, financial condition or results of operations.

XML

Fair Value Measurements

6 Months Ended

Jun. 30, 2017

Fair Value Disclosures [Abstract]

Fair Value Measurements

Note 16 Fair Value Measurements

The Company uses fair value measurements to record fair value adjustments to certain assets and liabilities and to disclose the fair value of its financial instruments. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. For disclosure purposes, the Company groups its financial and non-financial assets and liabilities into three different levels based on the nature of the instrument and the availability and reliability of the information that is used to determine fair value. The three levels are defined as follows:

· Level 1—Includes assets or liabilities in which the inputs to the valuation methodologies are based on unadjusted quoted prices in active markets for identical assets or liabilities.

· Level 2—Includes assets or liabilities in which the inputs to the valuation methodologies are based on similar assets or liabilities in inactive markets, quoted prices for identical or similar assets or liabilities in inactive markets, and inputs other than quoted prices that are observable, such as interest rates, yield curves, volatilities, prepayment speeds, and other inputs obtained from observable market input.

· Level 3—Includes assets or liabilities in which the inputs to the valuation methodology are based on at least one significant assumption that is not observable in the marketplace. These valuations may rely on management’s judgment and may include internally-developed model-based valuation techniques.

Level 1 inputs are considered to be the most transparent and reliable and level 3 inputs are considered to be the least transparent and reliable. The Company assumes the use of the principal market to conduct a transaction of each particular asset or liability being measured and then considers the assumptions that market participants would use when pricing the asset or liability. Whenever possible, the Company first looks for quoted prices for identical assets or liabilities in active markets (level 1 inputs) to value each asset or liability. However, when inputs from identical assets or liabilities on active markets are not available, the Company utilizes market observable data for similar assets and liabilities. The Company maximizes the use of observable inputs and limits the use of unobservable inputs to occasions when observable inputs are not available. The need to use unobservable inputs generally results from the lack of market liquidity of the actual financial instrument or of the underlying collateral. Although, in some instances, third party price indications may be available, limited trading activity can challenge the observability of these quotations.

Changes in the valuation inputs used for measuring the fair value of financial instruments may occur due to changes in current market conditions or other factors. Such changes may necessitate a transfer of the financial instruments to another level in the hierarchy based on the new inputs used. The Company recognizes these transfers at the end of the reporting period that the transfer occurs. During the six months ended June 30, 2017 and 2016, there were no transfers of financial instruments between the hierarchy levels.

The following is a description of the valuation methodologies used for assets and liabilities measured at fair value, as well as the general classification of each instrument under the valuation hierarchy:

Fair Value of Financial Instruments Measured on a Recurring Basis

Investment securities available-for-sale—Investment securities available-for-sale are carried at fair value on a recurring basis. To the extent possible, observable quoted prices in an active market are used to determine fair value and, as such, these securities are classified as level 1. At June 30, 2017 and December 31, 2016, the Company did not hold any level 1 securities. When quoted market prices in active markets for identical assets or liabilities are not available, quoted prices of securities with similar characteristics, discounted cash flows or other pricing characteristics are used to estimate fair values and the securities are then classified as level 2.

Interest rate swap derivatives—The Company's derivative instruments are limited to interest rate swaps that may be accounted for as fair value hedges or non-designated hedges. The fair values of the swaps incorporate credit valuation adjustments in order to appropriately reflect nonperformance risk in the fair value measurements. The credit valuation adjustment is the dollar amount of the fair value adjustment related to credit risk and utilizes a probability weighted calculation to quantify the potential loss over the life of the trade. The credit valuation adjustments are calculated by determining the total expected exposure of the derivatives (which incorporates both the current and potential future exposure) and then applying the respective counterparties’ credit spreads to the exposure offset by marketable collateral posted, if any. Certain derivative transactions are executed with counterparties who are large financial institutions ("dealers"). International Swaps and Derivative Association Master Agreements ("ISDA") and Credit Support Annexes ("CSA") are employed for all contracts with dealers. These contracts contain bilateral collateral arrangements. The fair value inputs of these financial instruments are determined using discounted cash flow analysis through the use of third-party models whose significant inputs are readily observable market parameters, primarily yield curves, with appropriate adjustments for liquidity and credit risk, and are classified as level 2.

Mortgage banking derivatives—The Company relies on a third-party pricing service to value its mortgage banking derivative financial assets and liabilities, which the Company classifies as a level 3 valuation. The external valuation model to estimate the fair value of its interest rate lock commitments to originate residential mortgage loans held for sale includes grouping the interest rate lock commitments by interest rate and terms, applying an estimated pull-through rate based on historical experience, and then multiplying by quoted investor prices determined to be reasonably applicable to the loan commitment groups based on interest rate, terms, and rate lock expiration dates of the loan commitment groups. The Company also relies on an external valuation model to estimate the fair value of its forward commitments to sell residential mortgage loans (i.e., an estimate of what the Company would receive or pay to terminate the forward delivery contract based on market prices for similar financial instruments), which includes matching specific terms and maturities of the forward commitments against applicable investor pricing.

The tables below present the financial instruments measured at fair value on a recurring basis as of June 30, 2017 and December 31, 2016 on the consolidated statements of financial condition utilizing the hierarchy structure described above:

	June 30, 2017
	Level 1		Level 2		Level 3		Total
Assets:
Investment securities available-for-sale:
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	—	$	195,341	$	—	$	195,341
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		—		668,631		—		668,631
Municipal securities		—		2,058		—		2,058
Interest rate swap derivatives		—		10,694		—		10,694
Mortgage banking derivatives		—		—		157		157
Total assets at fair value	$	—	$	876,724	$	157	$	876,881
Liabilities:
Interest rate swap derivatives	$	—	$	4,729	$	—	$	4,729
Mortgage banking derivatives		—		—		26		26
Total liabilities at fair value	$	—	$	4,729	$	26	$	4,755

	December 31, 2016
	Level 1		Level 2		Level 3		Total
Assets:
Investment securities available-for-sale:
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	—	$	227,160	$	—	$	227,160
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		—		652,739		—		652,739
Municipal securities		—		3,648		—		3,648
Interest rate swap derivatives		—		11,428		—		11,428
Mortgage banking derivatives		—		—		287		287
Total assets at fair value	$	—	$	894,975	$	287	$	895,262
Liabilities:
Interest rate swap derivatives	$	—	$	3,279	$	—	$	3,279
Mortgage banking derivatives		—		—		26		26
Total liabilities at fair value	$	—	$	3,279	$	26	$	3,305

The table below details the changes in level 3 financial instruments during the six months ended June 30, 2017 and June 30, 2016:

		Mortgage banking
		derivatives, net
Balance at December 31, 2016	$	261
Loss included in earnings, net		(130)
Balance at June 30, 2017	$	131

Fair Value of Financial Instruments Measured on a Non-recurring Basis

Certain assets may be recorded at fair value on a non-recurring basis as conditions warrant. These non-recurring fair value measurements typically result from the application of lower of cost or fair value accounting or a write-down occurring during the period.

The Company records collateral dependent loans that are considered to be impaired at their estimated fair value. A loan is considered impaired when it is probable that the Company will be unable to collect all contractual amounts due in accordance with the terms of the loan agreement. Collateral dependent impaired loans are measured based on the fair value of the collateral. The Company relies on third-party appraisals and internal assessments in determining the estimated fair values of these loans. The inputs used to determine the fair values of loans are considered level 3 inputs in the fair value hierarchy. At June 30, 2017, the Company measured seven loans not accounted for under ASC 310-30 at fair value on a non-recurring basis, with a carrying balance of $14.5 million and specific reserve balance of $6.2 million. At June 30, 2016, the Company measured six loans with a total carrying balance of $30.1 million and total specific reserves of $14.9 million.

The Company may be required to record fair value adjustments on loans held-for-sale on a non-recurring basis. The non-recurring fair value adjustments could involve lower of cost or fair value accounting and may include write-downs.

OREO is recorded at the lower of the cost basis or the fair value of the collateral less estimated selling costs. The estimated fair values of OREO are updated periodically and further write-downs may be taken to reflect a new basis. The Company recognized $46 thousand and $104 thousand of OREO impairments in its consolidated statements of operations during the six months ended June 30, 2017 and 2016, respectively. The fair values of OREO are derived from third party price opinions or appraisals that generally use an income approach or a market value approach. If reasonable comparable appraisals are not available, then the Company may use internally developed models to determine fair values. The inputs used to determine the fair values of OREO are considered level 3 inputs in the fair value hierarchy.

The table below provides information regarding the assets recorded at fair value on a non-recurring basis during the six months ended June 30, 2017 and 2016:

	June 30, 2017
	Total		Losses from fair value changes
Other real estate owned	$	14,297	$	46
Impaired loans		39,379		327

	June 30, 2016
	Total		Losses from fair value changes
Other real estate owned	$	23,242	$	104
Impaired loans		46,815		4,019

The Company did not record any liabilities for which the fair value was made on a non-recurring basis during the six months ended June 30, 2017.

The following table provides information about the valuation techniques and unobservable inputs used in the valuation of financial instruments classified as level 3 of the fair value hierarchy as of June 30, 2017. The table below excludes non-recurring fair value measurements of collateral value used for impairment measures for OREO and premises and equipment, and other available-for-sale and municipal securities valued at par. The below valuation utilizes third party appraisal or broker price opinions, and is classified as level 3 due to the significant judgment involved:

	Fair value at
	June 30, 2017		Valuation technique	Unobservable input	Qualitative measures
Impaired loans		39,379	Appraised value	Appraised values
				Discount rate	0% - 25%

XML

Fair Value of Financial Instruments

6 Months Ended

Jun. 30, 2017

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

Note 17 Fair Value of Financial Instruments

The fair value of a financial instrument is the amount that would be exchanged between willing parties, other than in a forced liquidation. Fair value is determined based upon quoted market prices to the extent possible; however, in many instances, there are no quoted market prices for the Company’s various financial instruments. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques that may be significantly impacted by the assumptions used, including the discount rate and estimates of future cash flows. Changes in any of these assumptions could significantly affect the fair value estimates. The fair value of the financial instruments listed below does not reflect a premium or discount that could result from offering all of the Company’s holdings of financial instruments at one time, nor does it reflect the underlying value of the Company, as ASC Topic 825 excludes certain financial instruments and all non-financial instruments from its disclosure requirements. The fair value of financial instruments at June 30, 2017 and December 31, 2016, including methods and assumptions utilized for determining fair value of financial instruments, are set forth below:

	Level in fair value	June 30, 2017				December 31, 2016
	measurement	Carrying		Estimated		Carrying		Estimated
	hierarchy	amount		fair value		amount		fair value
ASSETS
Cash and cash equivalents	Level 1	$	129,827	$	129,827	$	152,736	$	152,736
Mortgage-backed securities—residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises available-for-sale	Level 2		195,341		195,341		227,160		227,160
Mortgage-backed securities—other residential mortgage-backed securities issued or guaranteed by U.S. Government agencies or sponsored enterprises available-for-sale	Level 2		668,631		668,631		652,739		652,739
Municipal securities	Level 2		2,058		2,058		3,648		3,648
Municipal securities	Level 3		265		265		265		265
Other available-for-sale securities	Level 3		419		419		419		419
Mortgage-backed securities—residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises held-to-maturity	Level 2		233,026		234,194		263,411		264,862
Mortgage-backed securities—other residential mortgage-backed securities issued or guaranteed by U.S. Government agencies or sponsored enterprises held-to-maturity	Level 2		61,865		60,675		69,094		67,711
Non-marketable securities	Level 2		18,468		18,468		14,949		14,949
Loans receivable	Level 3		3,087,945		3,096,298		2,860,921		2,879,860
Loans held-for-sale	Level 2		7,067		7,067		24,187		24,187
Accrued interest receivable	Level 2		13,294		13,294		12,562		12,562
Interest rate swap derivatives	Level 2		10,694		10,694		11,428		11,428
Mortgage banking derivatives	Level 3		157		157		287		287
LIABILITIES
Deposit transaction accounts	Level 2		2,730,976		2,730,976		2,696,603		2,696,603
Time deposits	Level 2		1,126,481		1,126,481		1,172,046		1,172,046
Securities sold under agreements to repurchase	Level 2		119,213		119,213		92,011		92,011
Federal Home Loan Bank advances	Level 2		129,115		130,642		38,665		39,324
Accrued interest payable	Level 2		5,098		5,098		4,973		4,973
Interest rate swap derivatives	Level 2		4,729		4,729		3,279		3,279
Mortgage banking derivatives	Level 3		26		26		187		187

Cash and cash equivalents

Cash and cash equivalents have a short-term nature and the estimated fair value is equal to the carrying value.

Investment securities

The estimated fair value of investment securities is based on quoted market prices or bid quotations received from securities dealers. Other investment securities, including securities that are held for regulatory purposes are carried at cost, less any other- than-temporary impairment.

Loans receivable

The estimated fair value of the loan portfolio is estimated using a discounted cash flow analysis using a discount rate based on interest rates offered at the respective measurement dates for loans with similar terms to borrowers of similar credit quality. The allowance for loan losses is considered a reasonable estimate of any required adjustment to fair value to reflect the impact of credit risk. The estimates of fair value do not incorporate the exit-price concept prescribed by ASC Topic 820, Fair Value Measurements and Disclosures.

Loans held-for-sale

Loans held-for-sale are carried at the lower of aggregate cost or estimated fair value. The portfolio consists primarily of fixed rate residential mortgage loans that are sold within 45 days. The estimated fair value is based on quoted market prices for similar loans in the secondary market and is classified as level 2.

Accrued interest receivable

Accrued interest receivable has a short-term nature and the estimated fair value is equal to the carrying value.

Deposits

The estimated fair value of deposits with no stated maturity, such as non-interest bearing demand deposits, savings, NOW accounts, and money market accounts, is equal to the amount payable on demand. The fair value of interest-bearing time deposits is based on the discounted value of contractual cash flows of such deposits, taking into account the option for early withdrawal. The discount rate is estimated using the rates offered by the Company, at the respective measurement dates, for deposits of similar remaining maturities. The fair value of time deposits has a floor equal to the carrying value as the amount payable on demand would approximate the carrying value.

Derivative assets and liabilities

Fair values for derivative assets and liabilities are fully described in note 16 of the consolidated financial statements.

Securities sold under agreements to repurchase

The vast majority of the Company’s repurchase agreements are overnight transactions that mature the day after the transaction, and as a result of this short-term nature, the estimated fair value is equal to the carrying value.

Accrued interest payable

Accrued interest payable has a short-term nature and the estimated fair value is equal to the carrying value.

XML

Investment Securities - (Tables)

6 Months Ended

Jun. 30, 2017

Investments, Debt and Equity Securities [Abstract]

Available-for-sale Securities

At June 30, 2017 and December 31, 2016, the Company held $0.9 billion of available-for-sale investment securities. Available-for-sale securities are summarized as follows as of the dates indicated:

	June 30, 2017
	Amortized		Gross		Gross
	cost		unrealized gains		unrealized losses		Fair value
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	192,369	$	3,476	$	(504)	$	195,341
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		680,040		1,604		(13,013)		668,631
Municipal securities		2,323		—		—		2,323
Other securities		419		—		—		419
Total	$	875,151	$	5,080	$	(13,517)	$	866,714

	December 31, 2016
	Amortized		Gross		Gross
	cost		unrealized gains		unrealized losses		Fair value
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	223,781	$	3,909	$	(530)	$	227,160
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		666,616		2,124		(16,001)		652,739
Municipal securities		3,921		—		(7)		3,914
Other securities		419		—		—		419
Total	$	894,737	$	6,033	$	(16,538)	$	884,232

Summary of unrealized losses for available-for-sale securities

The table below summarizes the available-for-sale securities with unrealized losses as of the dates shown, along with the length of the impairment period:

	June 30, 2017
	Less than 12 months				12 months or more				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	value		losses		value		losses		value		losses
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	79,548	$	(504)	$	—	$	—	$	79,548	$	(504)
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		148,819		(2,279)		354,843		(10,734)		503,662		(13,013)
Total	$	228,367	$	(2,783)	$	354,843	$	(10,734)	$	583,210	$	(13,517)

	December 31, 2016
	Less than 12 months				12 months or more				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	value		losses		value		losses		value		losses
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	100,898	$	(530)	$	—	$	—	$	100,898	$	(530)
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		137,576		(2,976)		385,707		(13,025)		523,283		(16,001)
Municipal securities		3,058		(7)		—		—		3,058		(7)
Total	$	241,532	$	(3,513)	$	385,707	$	(13,025)	$	627,239	$	(16,538)

Held-to-maturity Securities

Held-to-maturity investment securities are summarized as follows as of the dates indicated:

	June 30, 2017
			Gross		Gross
	Amortized		unrealized		unrealized
	cost		gains		losses		Fair value
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	233,026	$	1,332	$	(164)	$	234,194
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		61,865		11		(1,201)		60,675
Total investment securities held-to-maturity	$	294,891	$	1,343	$	(1,365)	$	294,869

	December 31, 2016
			Gross		Gross
	Amortized		unrealized		unrealized
	cost		gains		losses		Fair value
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	263,411	$	1,685	$	(234)	$	264,862
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		69,094		16		(1,399)		67,711
Total investment securities held-to-maturity	$	332,505	$	1,701	$	(1,633)	$	332,573

Summary of unrealized losses for held-to-maturity securities

The table below summarizes the held-to-maturity securities with unrealized losses as of the dates shown, along with the length of the impairment period:

	June 30, 2017
	Less than 12 months				12 months or more				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	value		losses		value		losses		value		losses
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	25,512	$	(164)	$	—	$	—	$	25,512	$	(164)
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		23,861		(306)		29,244		(895)		53,105		(1,201)
Total	$	49,373	$	(470)	$	29,244	$	(895)	$	78,617	$	(1,365)

	December 31, 2016
	Less than 12 months				12 months or more				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	value		losses		value		losses		value		losses
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	27,799	$	(234)	$	—	$	—	$	27,799	$	(234)
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		26,992		(357)		32,146		(1,042)		59,138		(1,399)
Total	$	54,791	$	(591)	$	32,146	$	(1,042)	$	86,937	$	(1,633)

XML

Loans - (Tables)

6 Months Ended

Jun. 30, 2017

Receivables [Abstract]

Loan Portfolio Composition Including Carrying Value by Segment of Loans Accounted for under ASC Topic 310-30 and Loans Covered by the FDIC Loss Sharing Agreements

The carrying value of loans is net of discounts on loans excluded from ASC 310-30, and fees and costs of $4.9 million and $6.3 million as of June 30, 2017 and December 31, 2016, respectively. At December 31, 2016, $14.4 million of non 310-30 loans were held-for-sale, most of which were in the residential real estate segment. The sale of these loans was completed in connection with the four banking center divestitures in the second quarter of 2017.

	June 30, 2017
	ASC 310-30 loans		Non 310-30 loans		Total loans		% of total
Commercial	$	35,978	$	1,739,476	$	1,775,454	57.5%
Commercial real estate non-owner occupied		83,785		473,235		557,020	18.0%
Residential real estate		14,012		714,499		728,511	23.6%
Consumer		652		26,308		26,960	0.9%
Total	$	134,427	$	2,953,518	$	3,087,945	100.0%

	December 31, 2016
	ASC 310-30 loans		Non 310-30 loans		Total loans		% of total
Commercial	$	39,280	$	1,521,150	$	1,560,430	54.6%
Commercial real estate non-owner occupied		89,150		437,642		526,792	18.4%
Residential real estate		16,524		728,361		744,885	26.0%
Consumer		898		27,916		28,814	1.0%
Total	$	145,852	$	2,715,069	$	2,860,921	100.0%

Past Due Financing Receivables

Delinquency for loans excluded from ASC 310-30 is shown in the following tables at June 30, 2017 and December 31, 2016, respectively:

	June 30, 2017
					Greater						Total		Loans > 90
	30-59		60-89		than 90						non		days past
	days  past		days past		days past		Total  past				310-30		due and		Non-
	due		due		due		due		Current		loans		still accruing		accrual
Loans excluded from ASC 310-30:
Commercial:
Commercial and industrial	$	658	$	228	$	4,135	$	5,021	$	1,270,834	$	1,275,855	$	—	$	7,780
Owner occupied commercial real estate		890		—		52		942		232,988		233,930		—		4,377
Agriculture		512		—		435		947		130,451		131,398		—		2,208
Energy		—		—		6,613		6,613		91,680		98,293		—		12,050
Total commercial		2,060		228		11,235		13,523		1,725,953		1,739,476		—		26,415
Commercial real estate non-owner occupied:
Construction		—		—		215		215		121,441		121,656		215		—
Acquisition/development		334		—		—		334		16,008		16,342		—		—
Multifamily		—		—		—		—		41,430		41,430		—		—
Non-owner occupied		135		—		—		135		293,672		293,807		—		35
Total commercial real estate		469		—		215		684		472,551		473,235		215		35
Residential real estate:
Senior lien		854		1,667		1,298		3,819		658,403		662,222		—		5,286
Junior lien		185		47		8		240		52,037		52,277		—		557
Total residential real estate		1,039		1,714		1,306		4,059		710,440		714,499		—		5,843
Consumer		69		19		6		94		26,214		26,308		—		162
Total loans excluded from ASC 310-30	$	3,637	$	1,961	$	12,762	$	18,360	$	2,935,158	$	2,953,518	$	215	$	32,455

	December 31, 2016
					Greater						Total		Loans > 90
	30-59		60-89		than 90						non		days past
	days past		days past		days past		Total  past				310-30		due and		Non-
	due		due		due		due		Current		loans		still accruing		accrual
Loans excluded from ASC 310-30:
Commercial:
Commercial and industrial	$	3,134	$	4,009	$	1,078	$	8,221	$	1,066,475	$	1,074,696	$	—	$	8,688
Owner occupied commercial real estate		583		216		56		855		220,689		221,544		—		2,056
Agriculture		501		—		—		501		134,136		134,637		—		1,905
Energy		2		—		6,548		6,550		83,723		90,273		—		12,645
Total commercial		4,220		4,225		7,682		16,127		1,505,023		1,521,150		—		25,294
Commercial real estate non-owner occupied:
Construction		—		—		—		—		90,314		90,314		—		—
Acquisition/development		—		—		—		—		13,306		13,306		—		—
Multifamily		—		—		—		—		24,954		24,954		—		—
Non-owner occupied		—		—		28		28		309,040		309,068		—		66
Total commercial real estate		—		—		28		28		437,614		437,642		—		66
Residential real estate:
Senior lien		888		645		1,458		2,991		672,699		675,690		—		4,522
Junior lien		115		61		22		198		52,473		52,671		—		654
Total residential real estate		1,003		706		1,480		3,189		725,172		728,361		—		5,176
Consumer		83		8		—		91		27,825		27,916		—		181
Total loans excluded from ASC 310-30	$	5,306	$	4,939	$	9,190	$	19,435	$	2,695,634	$	2,715,069	$	—	$	30,717

Credit Exposure for Loans as Determined by Company's Internal Risk Rating System

Credit exposure for all loans as determined by the Company’s internal risk rating system was as follows as of June 30, 2017 and December 31, 2016, respectively:

	June 30, 2017
			Special
	Pass		mention		Substandard		Doubtful		Total
Loans excluded from ASC 310-30:
Commercial:
Commercial and industrial	$	1,243,638	$	13,978	$	15,472	$	2,767	$	1,275,855
Owner occupied commercial real estate		222,882		4,607		6,196		245		233,930
Agriculture		106,022		22,668		2,674		34		131,398
Energy		86,243		—		5,998		6,052		98,293
Total commercial		1,658,785		41,253		30,340		9,098		1,739,476
Commercial real estate non-owner occupied:
Construction		121,441		—		215		—		121,656
Acquisition/development		13,844		2,498		—		—		16,342
Multifamily		39,255		—		2,175		—		41,430
Non-owner occupied		291,007		1,566		1,234		—		293,807
Total commercial real estate		465,547		4,064		3,624		—		473,235
Residential real estate:
Senior lien		656,249		251		5,709		13		662,222
Junior lien		51,404		—		873		—		52,277
Total residential real estate		707,653		251		6,582		13		714,499
Consumer		26,086		56		166		—		26,308
Total loans excluded from ASC 310-30	$	2,858,071	$	45,624	$	40,712	$	9,111	$	2,953,518
Loans accounted for under ASC 310-30:
Commercial	$	27,799	$	1,105	$	7,074	$	—	$	35,978
Commercial real estate non-owner occupied		54,207		1,701		27,877		—		83,785
Residential real estate		11,234		1,088		1,690		—		14,012
Consumer		464		12		176		—		652
Total loans accounted for under ASC 310-30	$	93,704	$	3,906	$	36,817	$	—	$	134,427
Total loans	$	2,951,775	$	49,530	$	77,529	$	9,111	$	3,087,945

	December 31, 2016
			Special
	Pass		mention		Substandard		Doubtful		Total
Loans excluded from ASC 310-30:
Commercial:
Commercial and industrial	$	1,041,326	$	7,243	$	25,636	$	491	$	1,074,696
Owner occupied commercial real estate		202,036		9,371		10,137		—		221,544
Agriculture		123,809		8,922		1,906		—		134,637
Energy		77,619		—		7,811		4,843		90,273
Total commercial		1,444,790		25,536		45,490		5,334		1,521,150
Commercial real estate non-owner occupied:
Construction		90,099		—		215		—		90,314
Acquisition/development		10,758		2,548		—		—		13,306
Multifamily		22,495		238		2,221		—		24,954
Non-owner occupied		300,922		5,895		2,251		—		309,068
Total commercial real estate		424,274		8,681		4,687		—		437,642
Residential real estate:
Senior lien		669,148		1,215		5,316		11		675,690
Junior lien		51,250		178		1,243		—		52,671
Total residential real estate		720,398		1,393		6,559		11		728,361
Consumer		27,669		59		188		—		27,916
Total loans excluded from ASC 310-30	$	2,617,131	$	35,669	$	56,924	$	5,345	$	2,715,069
Loans accounted for under ASC 310-30:
Commercial	$	27,436	$	610	$	11,234	$	—	$	39,280
Commercial real estate non-owner occupied		38,895		967		45,520		3,768		89,150
Residential real estate		12,477		1,327		2,720		—		16,524
Consumer		721		17		160		—		898
Total loans accounted for under ASC 310-30	$	79,529	$	2,921	$	59,634	$	3,768	$	145,852
Total loans	$	2,696,660	$	38,590	$	116,558	$	9,113	$	2,860,921

Schedule Of Impaired Financing Receivable With And Without Related Allowance

Additional information regarding impaired loans at June 30, 2017 and December 31, 2016 is set forth in the table below:

	June 30, 2017						December 31, 2016
					Allowance						Allowance
	Unpaid				for loan		Unpaid				for loan
	principal		Recorded		losses		principal		Recorded		losses
	balance		investment		allocated		balance		investment		allocated
With no related allowance recorded:
Commercial:
Commercial and industrial	$	6,712	$	5,387	$	—	$	8,671	$	7,495	$	—
Owner occupied commercial real estate		3,954		3,755		—		3,350		3,197		—
Agriculture		1,581		1,377		—		2,044		1,987		—
Energy		16,548		5,437		—		17,142		6,105		—
Total commercial		28,795		15,956		—		31,207		18,784		—
Commercial real estate non-owner occupied:
Construction		—		—		—		—		—		—
Acquisition/development		—		—		—		—		—		—
Multifamily		31		31		—		33		33		—
Non-owner occupied		357		306		—		394		343		—
Total commercial real estate		388		337		—		427		376		—
Residential real estate:
Senior lien		345		328		—		1,551		1,426		—
Junior lien		—		—		—		54		51		—
Total residential real estate		345		328		—		1,605		1,477		—
Consumer		—		—		—		4		4		—
Total impaired loans with no related allowance recorded	$	29,528	$	16,621	$	—	$	33,243	$	20,641	$	—
With a related allowance recorded:
Commercial:
Commercial and industrial	$	4,681	$	4,642	$	2,767	$	3,495	$	3,464	$	492
Owner occupied commercial real estate		2,585		2,336		248		957		642		2
Agriculture		938		911		35		—		—		—
Energy		6,613		6,613		3,148		11,216		6,548		1,866
Total commercial		14,817		14,502		6,198		15,668		10,654		2,360
Commercial real estate non-owner occupied:
Construction		—		—		—		—		—		—
Acquisition/development		—		—		—		—		—		—
Multifamily		—		—		—		—		—		—
Non-owner occupied		220		214		1		261		255		1
Total commercial real estate		220		214		1		261		255		1
Residential real estate:
Senior lien		7,162		6,486		36		5,646		5,016		31
Junior lien		1,634		1,391		10		1,781		1,532		14
Total residential real estate		8,796		7,877		46		7,427		6,548		45
Consumer		170		165		1		188		184		2
Total impaired loans with a related allowance recorded	$	24,003	$	22,758	$	6,246	$	23,544	$	17,641	$	2,408
Total impaired loans	$	53,531	$	39,379	$	6,246	$	56,787	$	38,282	$	2,408

Schedule of Impaired Financing Receivable, Average Recorded Investment and Interest Income Recognized

The table below shows additional information regarding the average recorded investment and interest income recognized on impaired loans for the periods presented:

	For the three months ended
	June 30, 2017				June 30, 2016
	Average recorded investment		Interest income recognized		Average recorded investment		Interest income recognized
With no related allowance recorded:
Commercial:
Commercial and industrial	$	6,645	$	25	$	4,279	$	70
Owner occupied commercial real estate		3,789		23		1,825		20
Agriculture		1,454		—		1,758		—
Energy		5,680		—		—		—
Total commercial		17,568		48		7,862		90
Commercial real estate non-owner occupied:
Construction		—		—		—		—
Acquisition/development		—		—		—		—
Multifamily		—		—		—		—
Non-owner occupied		312		5		—		—
Total commercial real estate		312		5		—		—
Residential real estate:
Senior lien		330		—		1,296		8
Junior lien		—		—		134		—
Total residential real estate		330		—		1,430		8
Consumer		—		—		—		—
Total impaired loans with no related allowance recorded	$	18,210	$	53	$	9,292	$	98
With a related allowance recorded:
Commercial:
Commercial and industrial	$	4,643	$	—	$	4,144	$	—
Owner occupied commercial real estate		2,340		7		842		4
Agriculture		912		1		178		1
Energy		6,624		—		25,975		—
Total commercial		14,519		8		31,139		5
Commercial real estate non-owner occupied:
Construction		—		—		—		—
Acquisition/development		—		—		—		—
Multifamily		31		—		35		—
Non-owner occupied		216		2		814		10
Total commercial real estate		247		2		849		10
Residential real estate:
Senior lien		6,525		20		5,149		28
Junior lien		1,403		12		1,652		14
Total residential real estate		7,928		32		6,801		42
Consumer		169		—		241		—
Total impaired loans with a related allowance recorded	$	22,863	$	42	$	39,030	$	57
Total impaired loans	$	41,073	$	95	$	48,322	$	155

	For the six months ended
	June 30, 2017				June 30, 2016
	Average recorded investment		Interest income recognized		Average recorded investment		Interest income recognized
With no related allowance recorded:
Commercial:
Commercial and industrial	$	7,030	$	73	$	4,564	$	138
Owner occupied commercial real estate		3,834		41		1,869		49
Agriculture		1,531		—		1,758		—
Energy		5,889		—		—		—
Total Commercial		18,284		114		8,191		187
Commercial real estate non-owner occupied:
Construction		—		—		—		—
Acquisition/development		—		—		—		—
Multifamily		—		—		—		—
Non-owner occupied		320		12		—		—
Total commercial real estate		320		12		—		—
Residential real estate:
Senior lien		334		—		1,312		14
Junior lien		—		—		136		1
Total residential real estate		334		—		1,448		15
Consumer		—		—		—		—
Total impaired loans with no related allowance recorded	$	18,938	$	126	$	9,639	$	202
With a related allowance recorded:
Commercial:
Commercial and industrial	$	4,630	$	—	$	4,312	$	—
Owner occupied commercial real estate		2,349		11		865		7
Agriculture		914		3		179		3
Energy		6,602		—		26,005		—
Total Commercial		14,495		14		31,361		10
Commercial real estate non-owner occupied:
Construction		—		—		—		—
Acquisition/development		—		—		—		—
Multifamily		31		1		36		1
Non-owner occupied		220		5		823		24
Total commercial real estate		251		6		859		25
Residential real estate:
Senior lien		6,583		40		5,212		53
Junior lien		1,421		25		1,670		27
Total residential real estate		8,004		65		6,882		80
Consumer		175		—		242		—
Total impaired loans with a related allowance recorded	$	22,925	$	85	$	39,344	$	115
Total impaired loans	$	41,863	$	211	$	48,983	$	317

Additional Information Related to Accruing TDR's

The table below provides additional information related to accruing TDRs at June 30, 2017 and December 31, 2016:

	June 30, 2017
	Recorded		Average year-to-date		Unpaid		Unfunded commitments
	investment		recorded investments		principal balance		to fund TDRs
Commercial	$	3,258	$	3,270	$	3,488	$	100
Commercial real estate non-owner occupied		491		510		543		—
Residential real estate		1,424		1,450		1,435		2
Consumer		4		5		4		—
Total	$	5,177	$	5,235	$	5,470	$	102

	December 31, 2016
	Recorded		Average year-to-date		Unpaid		Unfunded commitments
	investment		recorded investments		principal balance		to fund TDRs
Commercial	$	3,302	$	3,440	$	3,464	$	100
Commercial real estate non-owner occupied		538		572		590		—
Residential real estate		1,920		1,996		1,969		2
Consumer		7		9		7		—
Total	$	5,767	$	6,017	$	6,030	$	102

Summary of Company's Carrying Value of Non-Accrual TDR's

The following table summarizes the Company’s carrying value of non-accrual TDRs as of June 30, 2017 and December 31, 2016:

	June 30, 2017		December 31, 2016
Commercial	$	20,246	$	15,265
Commercial real estate non-owner occupied		—		—
Residential real estate		1,308		1,301
Consumer		127		142
Total non-accruing TDRs	$	21,681	$	16,708

Re-Measurement of Loans Accounted for Under ASC Topic 310-30 Resulting in Changes in Carrying Amount of Accretable Yield

The re-measurement of loans accounted for under ASC 310-30 resulted in the following changes in the carrying amount of accretable yield during the six months ended June 30, 2017 and 2016:

	June 30, 2017		June 30, 2016
Accretable yield beginning balance	$	60,476	$	84,194
Reclassification from non-accretable difference		7,732		5,646
Reclassification to non-accretable difference		(494)		(4,019)
Accretion		(12,051)		(18,056)
Accretable yield ending balance	$	55,663	$	67,765

Composition of Net Book Value for Loans Accounted for under ASC Topic 310-30

Below is the composition of the net book value for loans accounted for under ASC 310-30 at June 30, 2017 and December 31, 2016:

	June 30, 2017		December 31, 2016
Contractual cash flows	$	514,149	$	537,611
Non-accretable difference		(324,059)		(331,283)
Accretable yield		(55,663)		(60,476)
Loans accounted for under ASC 310-30	$	134,427	$	145,852

XML

Allowance for Loan Losses - (Tables)

6 Months Ended

Jun. 30, 2017

Receivables [Abstract]

Summary of Company's Allowance for Loan Losses ("ALL") and Recorded Investment in Loans

The tables below detail the Company’s allowance for loan losses (“ALL”) and recorded investment in loans as of and for the three and six months ended June 30, 2017 and 2016:

	Three months ended  June 30, 2017
			Non-owner
			occupied
			commercial		Residential
	Commercial		real estate		real estate		Consumer		Total
Beginning balance	$	20,539	$	5,815	$	4,216	$	280	$	30,850
Non 310-30 beginning balance		20,539		5,599		4,216		276		30,630
Charge-offs		—		—		(2)		(119)		(121)
Recoveries		30		10		110		55		205
Provision		4,087		191		(257)		82		4,103
Non 310-30 ending balance		24,656		5,800		4,067		294		34,817
ASC 310-30 beginning balance		—		216		—		4		220
Charge-offs		—		—		—		—		—
Recoveries		—		—		—		—		—
(Recoupment) provision		—		(82)		—		4		(78)
ASC 310-30 ending balance		—		134		—		8		142
Ending balance	$	24,656	$	5,934	$	4,067	$	302	$	34,959

	Three months ended  June 30, 2016
			Non-owner
			occupied
			commercial		Residential
	Commercial		real estate		real estate		Consumer		Total
Beginning balance	$	28,684	$	3,861	$	4,325	$	296	$	37,166
Non 310-30 beginning balance		28,610		3,803		4,289		249		36,951
Charge-offs		(3,375)		—		(140)		(171)		(3,686)
Recoveries		12		56		16		126		210
Provision		4,733		1,298		339		30		6,400
Non 310-30 ending balance		29,980		5,157		4,504		234		39,875
ASC 310-30 beginning balance		74		58		36		47		215
Charge-offs		—		(41)		—		—		(41)
Recoveries		—		—		—		—		—
(Recoupment) provision		(72)		194		(36)		(29)		57
ASC 310-30 ending balance		2		211		—		18		231
Ending balance	$	29,982	$	5,368	$	4,504	$	252	$	40,106

	Six months ended June 30, 2017
			Non-owner
			occupied
			commercial		Residential
	Commercial		real estate		real estate		Consumer		Total
Beginning balance	$	18,821	$	5,642	$	4,387	$	324	$	29,174
Non 310-30 beginning balance		18,821		5,422		4,387		319		28,949
Charge-offs		(20)		—		(10)		(301)		(331)
Recoveries		41		20		113		122		296
Provision		5,814		358		(423)		154		5,903
Non 310-30 ending balance		24,656		5,800		4,067		294		34,817
ASC 310-30 beginning balance		—		220		—		5		225
Charge-offs		—		—		—		—		—
Recoveries		—		—		—		—		—
(Recoupment) provision		—		(86)		—		3		(83)
ASC 310-30 ending balance		—		134		—		8		142
Ending balance	$	24,656	$	5,934	$	4,067	$	302	$	34,959
Ending allowance balance attributable to:
Non 310-30 loans individually evaluated for impairment	$	6,197	$	1	$	45	$	1	$	6,244
Non 310-30 loans collectively evaluated for impairment		18,459		5,799		4,022		293		28,573
ASC 310-30 loans		—		134		—		8		142
Total ending allowance balance	$	24,656	$	5,934	$	4,067	$	302	$	34,959
Loans:
Non 310-30 individually evaluated for impairment	$	30,458	$	551	$	8,205	$	165	$	39,379
Non 310-30 collectively evaluated for impairment		1,709,018		472,684		706,294		26,143		2,914,139
ASC 310-30 loans		35,978		83,785		14,012		652		134,427
Total loans	$	1,775,454	$	557,020	$	728,511	$	26,960	$	3,087,945

	Six months ended June 30, 2016
			Non-owner
			occupied
			commercial		Residential
	Commercial		real estate		real estate		Consumer		Total
Beginning balance	$	17,261	$	4,166	$	5,281	$	411	$	27,119
Non 310-30 beginning balance		16,473		3,939		5,245		385		26,042
Charge-offs		(3,484)		(276)		(197)		(388)		(4,345)
Recoveries		24		65		23		185		297
Provision		16,967		1,429		(567)		52		17,881
Non 310-30 ending balance		29,980		5,157		4,504		234		39,875
ASC 310-30 beginning balance		788		227		36		26		1,077
Charge-offs		—		(41)		—		—		(41)
Recoveries		—		—		—		—		—
(Recoupment) provision		(786)		25		(36)		(8)		(805)
ASC 310-30 ending balance		2		211		—		18		231
Ending balance	$	29,982	$	5,368	$	4,504	$	252	$	40,106
Ending allowance balance attributable to:
Non 310-30 loans individually evaluated for impairment	$	14,933	$	3	$	39	$	2	$	14,977
Non 310-30 loans collectively evaluated for impairment		15,047		5,154		4,465		232		24,898
ASC 310-30 loans		2		211		—		18		231
Total ending allowance balance	$	29,982	$	5,368	$	4,504	$	252	$	40,106
Loans:
Non 310-30 individually evaluated for impairment	$	37,265	$	842	$	7,369	$	240	$	45,716
Non 310-30 collectively evaluated for impairment		1,406,609		423,178		667,461		26,258		2,523,506
ASC 310-30 loans		46,875		101,719		19,341		1,347		169,282
Total loans	$	1,490,749	$	525,739	$	694,171	$	27,845	$	2,738,504

XML

Other Real Estate Owned - (Tables)

6 Months Ended

Jun. 30, 2017

FDIC Loss-Sharing Related

Summary of Activity in OREO Balances

The table below details the OREO activity during the six months ended June 30, 2017 and 2016:

	For the six months ended June 30,
	2017		2016
Beginning balance	$	15,662	$	20,814
Transfers from loan portfolio, at fair value		639		3,654
Impairments		(46)		(104)
Sales, net		(1,958)		(1,122)
Ending balance	$	14,297	$	23,242

XML

Regulatory Capital - (Tables)

6 Months Ended

Jun. 30, 2017

FDIC Loss-Sharing Related

Capital Ratio Requirements under Prompt Corrective Action or Other Regulatory Requirements

The following table sets forth the capital ratios of the Company and the Bank at June 30, 2017 and December 31, 2016.

	June 30, 2017
				Required to be			Required to be
				well capitalized under			considered
				prompt corrective			adequately
	Actual			action provisions			capitalized
	Ratio	Amount		Ratio	Amount		Ratio	Amount
Tier 1 leverage ratio:
Consolidated	10.3%	$	472,627	N/A		N/A	4.0%	$	184,402
NBH Bank	8.4%		385,466	4.5%	$	206,721	4.0%		183,752
Common equity tier 1 risk-based capital:
Consolidated	13.3%	$	472,627	N/A		N/A	4.5%	$	207,452
NBH Bank	10.9%		385,466	6.5%	$	298,597	4.5%		206,721
Tier 1 risk-based capital ratio:
Consolidated	13.3%	$	472,627	N/A		N/A	6.0%	$	213,366
NBH Bank	10.9%		385,466	8.0%	$	283,313	6.0%		212,485
Total risk-based capital ratio:
Consolidated	14.3%	$	507,912	N/A		N/A	8.0%	$	284,488
NBH Bank	11.9%		420,750	10.0%	$	354,141	8.0%		283,313

	December 31, 2016
				Required to be			Required to be
				well capitalized under			considered
				prompt corrective			adequately
	Actual			action provisions			capitalized
	Ratio	Amount		Ratio	Amount		Ratio	Amount
Tier 1 leverage ratio:
Consolidated	10.4%	$	470,259	N/A		N/A	4.0%	$	181,019
NBH Bank	8.6%		389,189	4.5%	$	202,903	4.0%		180,358
Common equity tier 1 risk-based capital:
Consolidated	14.2%	$	470,259	N/A		N/A	4.5%	$	203,647
NBH Bank	11.8%		389,189	6.5%	$	293,082	4.5%		202,903
Tier 1 risk-based capital ratio:
Consolidated	14.2%	$	470,259	N/A		N/A	6.0%	$	199,467
NBH Bank	11.8%		389,189	8.0%	$	264,596	6.0%		198,447
Total risk-based capital ratio:
Consolidated	15.0%	$	499,759	N/A		N/A	8.0%	$	265,955
NBH Bank	12.7%		418,689	10.0%	$	330,745	8.0%		264,596

XML

Stock-based Compensation and Benefits - (Tables)

6 Months Ended

Jun. 30, 2017

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Summary of Option Activity

The Company issued stock options in accordance with the 2014 Plan during 2017. The following table summarizes stock option activity for the six months ended June 30, 2017:

				Weighted
				average
		Weighted		remaining
		average		contractual	Aggregate
		exercise		term in	intrinsic
	Options	price		years	value
Outstanding at December 31, 2016	2,185,922	$	19.81	4.85	$	7,753
Granted	99,920		33.98
Exercised	(585,750)		19.93
Forfeited	(16,225)		21.84
Outstanding at June 30, 2017	1,683,867	$	20.61	4.52	$	21,136
Options exercisable at June 30, 2017	1,429,584	$	19.80	3.77	$	19,021
Options expected to vest	1,662,690	$	20.53	4.46	$	20,994

Summary of Restricted Stock Activity

The following table summarizes restricted stock and performance stock activity during the six months ended June 30, 2017:

		Weighted				Weighted
	Restricted	average grant-		Performance		average grant-
	shares	date fair value		stock units		date fair value
Unvested at December 31, 2016	499,271	$	15.82	85,295	$	18.22
Granted	65,990		33.43	49,758		33.22
Vested	(298,086)		15.27	—		—
Forfeited	(11,111)		22.23	(5,994)		20.90
Unvested at June 30, 2017	256,064	$	20.82	129,059	$	23.88

XML

Income Per Share - (Tables)

6 Months Ended

Jun. 30, 2017

Earnings Per Share [Abstract]

Schedule of Computation of Basic and Diluted Income (Loss) Per Share

The following table illustrates the computation of basic and diluted income per share for the three and six months ended June 30, 2017 and 2016:

	For the three months ended				For the six months ended
	June 30, 2017		June 30, 2016		June 30, 2017		June 30, 2016
Net income	$	9,209	$	4,504	$	17,467	$	4,755
Less: income allocated to participating securities		(14)		(12)		(30)		(25)
Income allocated to common shareholders	$	9,195	$	4,492	$	17,437	$	4,730
Weighted average shares outstanding for basic income per common share		26,955,187		29,215,822		26,878,904		29,666,570
Dilutive effect of equity awards		642,256		49,461		742,001		37,643
Dilutive effect of warrants		—		13,476		16,627		3,166
Weighted average shares outstanding for diluted income per common share		27,597,443		29,278,759		27,637,532		29,707,379
Basic income per share	$	0.34	$	0.15	$	0.65	$	0.16
Diluted income per share	$	0.33	$	0.15	$	0.63	$	0.16

XML

Derivatives - (Tables)

6 Months Ended

Jun. 30, 2017

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value

The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the consolidated statements of financial condition as of June 30, 2017 and December 31, 2016.

Information about the valuation methods used to measure fair value is provided in note 16.

		Asset derivatives fair value					Liability derivatives fair value
	Balance Sheet	June 30,		December 31,		Balance Sheet	June 30,		December 31,
	location	2017		2016		location	2017		2016
Derivatives designated as hedging instruments:
Interest rate products	Other assets	$	8,310	$	9,528	Other liabilities	$	2,268	$	1,381
Total derivatives designated as hedging instruments		$	8,310	$	9,528		$	2,268	$	1,381
Derivatives not designated as hedging instruments:
Interest rate products	Other assets	$	2,384	$	1,900	Other liabilities	$	2,461	$	1,898
Interest rate lock commitments	Other assets		143		149	Other liabilities		—		6
Forward contracts	Other assets		14		138	Other liabilities		26		20
Total derivatives not designated as hedging instruments		$	2,541	$	2,187		$	2,487	$	2,085

Derivative Instruments, Gain (Loss)

The tables below present the effect of the Company’s derivative financial instruments on the consolidated statements of operations for the three and six months ended June 30, 2017 and 2016:

	Location of gain (loss)	Amount of gain (loss) recognized in income on derivatives
Derivatives in fair value	recognized in income on	For the three months ended June 30,				For the six months ended June 30,
hedging relationships	derivatives	2017		2016		2017		2016
Interest rate products	Other non-interest income	$	(3,169)	$	(6,513)	$	(2,105)	$	(17,414)
Total		$	(3,169)	$	(6,513)	$	(2,105)	$	(17,414)

	Location of gain (loss)	Amount of gain (loss) recognized in income on hedged items
	recognized in income on	For the three months ended June 30,				For the six months ended June 30,
Hedged items	hedged items	2017		2016		2017		2016
Interest rate products	Other non-interest income	$	2,962	$	6,051	$	1,720	$	16,281
Total		$	2,962	$	6,051	$	1,720	$	16,281

	Location of gain (loss)	Amount of gain (loss) recognized in income on derivatives
Derivatives not designated	recognized in income on	For the three months ended June 30,				For the six months ended June 30,
as hedging instruments	derivatives	2017		2016		2017		2016
Interest rate products	Other non-interest expense	$	(47)	$	(89)	$	(79)	$	(183)
Interest rate lock commitments	Gain on sale of mortgages, net		(122)		332		1		332
Forward contracts	Gain on sale of mortgages, net		63		(178)		(131)		(178)
Total		$	(106)	$	65	$	(209)	$	(29)

XML

Commitments and Contingencies (Tables)

6 Months Ended

Jun. 30, 2017

Commitments and Contingencies Disclosure [Abstract]

Schedule of Total Unfunded Commitments

Total unfunded commitments at June 30, 2017 and December 31, 2016 were as follows:

	June 30, 2017		December 31, 2016
Commitments to fund loans	$	181,052	$	149,391
Unfunded commitments under lines of credit		467,180		452,851
Commercial and standby letters of credit		15,030		13,532
Total unfunded commitments	$	663,262	$	615,774

XML

Fair Value Measurements - (Tables)

6 Months Ended

Jun. 30, 2017

Fair Value Disclosures [Abstract]

Tables of Financial Instruments Measured At Fair Value on Recurring Basis

The tables below present the financial instruments measured at fair value on a recurring basis as of June 30, 2017 and December 31, 2016 on the consolidated statements of financial condition utilizing the hierarchy structure described above:

	June 30, 2017
	Level 1		Level 2		Level 3		Total
Assets:
Investment securities available-for-sale:
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	—	$	195,341	$	—	$	195,341
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		—		668,631		—		668,631
Municipal securities		—		2,058		—		2,058
Interest rate swap derivatives		—		10,694		—		10,694
Mortgage banking derivatives		—		—		157		157
Total assets at fair value	$	—	$	876,724	$	157	$	876,881
Liabilities:
Interest rate swap derivatives	$	—	$	4,729	$	—	$	4,729
Mortgage banking derivatives		—		—		26		26
Total liabilities at fair value	$	—	$	4,729	$	26	$	4,755

	December 31, 2016
	Level 1		Level 2		Level 3		Total
Assets:
Investment securities available-for-sale:
Mortgage-backed securities (“MBS”):
Residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	$	—	$	227,160	$	—	$	227,160
Other residential MBS issued or guaranteed by U.S. Government agencies or sponsored enterprises		—		652,739		—		652,739
Municipal securities		—		3,648		—		3,648
Interest rate swap derivatives		—		11,428		—		11,428
Mortgage banking derivatives		—		—		287		287
Total assets at fair value	$	—	$	894,975	$	287	$	895,262
Liabilities:
Interest rate swap derivatives	$	—	$	3,279	$	—	$	3,279
Mortgage banking derivatives		—		—		26		26
Total liabilities at fair value	$	—	$	3,279	$	26	$	3,305

Table of Changes in Level 3 Financial Instruments

The table below details the changes in level 3 financial instruments during the six months ended June 30, 2017 and June 30, 2016:

		Mortgage banking
		derivatives, net
Balance at December 31, 2016	$	261
Loss included in earnings, net		(130)
Balance at June 30, 2017	$	131

Table of assets recorded at fair value on a non-recurring basis

The table below provides information regarding the assets recorded at fair value on a non-recurring basis during the six months ended June 30, 2017 and 2016:

	June 30, 2017
	Total		Losses from fair value changes
Other real estate owned	$	14,297	$	46
Impaired loans		39,379		327

	June 30, 2016
	Total		Losses from fair value changes
Other real estate owned	$	23,242	$	104
Impaired loans		46,815		4,019

Table of Valuation Techniques and Unobservable Inputs Used in Valuation of Financial Instruments Falling Within Level 3 of Fair Value Hierarchy

The below valuation utilizes third party appraisal or broker price opinions, and is classified as level 3 due to the significant judgment involved:

	Fair value at
	June 30, 2017		Valuation technique	Unobservable input	Qualitative measures
Impaired loans		39,379	Appraised value	Appraised values
				Discount rate	0% - 25%

XML

Fair Value of Financial Instruments - (Tables)

6 Months Ended

Jun. 30, 2017

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

The fair value of financial instruments at June 30, 2017 and December 31, 2016, including methods and assumptions utilized for determining fair value of financial instruments, are set forth below:

	Level in fair value	June 30, 2017				December 31, 2016
	measurement	Carrying		Estimated		Carrying		Estimated
	hierarchy	amount		fair value		amount		fair value
ASSETS
Cash and cash equivalents	Level 1	$	129,827	$	129,827	$	152,736	$	152,736
Mortgage-backed securities—residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises available-for-sale	Level 2		195,341		195,341		227,160		227,160
Mortgage-backed securities—other residential mortgage-backed securities issued or guaranteed by U.S. Government agencies or sponsored enterprises available-for-sale	Level 2		668,631		668,631		652,739		652,739
Municipal securities	Level 2		2,058		2,058		3,648		3,648
Municipal securities	Level 3		265		265		265		265
Other available-for-sale securities	Level 3		419		419		419		419
Mortgage-backed securities—residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises held-to-maturity	Level 2		233,026		234,194		263,411		264,862
Mortgage-backed securities—other residential mortgage-backed securities issued or guaranteed by U.S. Government agencies or sponsored enterprises held-to-maturity	Level 2		61,865		60,675		69,094		67,711
Non-marketable securities	Level 2		18,468		18,468		14,949		14,949
Loans receivable	Level 3		3,087,945		3,096,298		2,860,921		2,879,860
Loans held-for-sale	Level 2		7,067		7,067		24,187		24,187
Accrued interest receivable	Level 2		13,294		13,294		12,562		12,562
Interest rate swap derivatives	Level 2		10,694		10,694		11,428		11,428
Mortgage banking derivatives	Level 3		157		157		287		287
LIABILITIES
Deposit transaction accounts	Level 2		2,730,976		2,730,976		2,696,603		2,696,603
Time deposits	Level 2		1,126,481		1,126,481		1,172,046		1,172,046
Securities sold under agreements to repurchase	Level 2		119,213		119,213		92,011		92,011
Federal Home Loan Bank advances	Level 2		129,115		130,642		38,665		39,324
Accrued interest payable	Level 2		5,098		5,098		4,973		4,973
Interest rate swap derivatives	Level 2		4,729		4,729		3,279		3,279
Mortgage banking derivatives	Level 3		26		26		187		187

XML

Basis of Presentation - (Details)	6 Months Ended
	Jun. 30, 2017 item
Accounting Policies [Abstract]
Number of full service banking offices	86

XML

Investment Securities - (Narrative) (Details) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2017 USD ($) security	Dec. 31, 2016 USD ($) security
Investment securities total	$ 1,200,000	$ 1,200,000
Amortized cost	875,151	894,737
Available-for-sale securities	866,714	884,232
Held-to-maturity securities	$ 294,891	$ 332,505
Mortgage-backed securities as percentage of available-for-sale investment portfolio	100.00%	100.00%
Number of securities | security	63	61
Fair value of available-for-sale securities in an unrealized loss position	$ 583,210	$ 627,239
Fair value of available-for-sale security with OTTI	1,500
Other than Temporary Impairment Losses, Investments	200
Fair value of available-for-sale investment securities pledged as collateral	$ 296,400	$ 373,700
Estimated weighted average life of the available-for-sale mortgage-backed securities portfolio	3 years 1 month 6 days	3 years 4 months 24 days
Life of the available-for-sale mortgage-backed securities portfolio	2 years 10 months 24 days	3 years 2 months 12 days
Other securities having no contractual maturity date	$ 400
Number of held-to-maturity securities in unrealized loss positions | security	16	15
Fair value of held-to-maturity securities in an unrealized loss position	$ 78,617	$ 86,937
Held-to-maturity investment securities pledged as collateral	$ 139,800	$ 119,200
Estimated weighted average expected life of the held-to-maturity mortgage-backed securities portfolio	3 years 1 month 6 days	3 years 6 months
Life of the held-to-maturity investment portfolio	2 years 10 months 24 days	3 years 2 months 12 days
Municiapl securities maturing witin one year Member
Available-for-sale securities	$ 1,500
Municipal securities maturing within one to five years [Member]
Amortized cost	300
Available-for-sale securities	300
Municipal securities due within five to ten years [Member]
Amortized cost	600
Available-for-sale securities	600
Other Securities [Member]
Amortized cost	419	$ 419
Available-for-sale securities	$ 419	$ 419

XML

Investment Securities - (Summary of Available-for-Sale Investment Securities) (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	$ 875,151	$ 894,737
Gross unrealized gains	5,080	6,033
Gross unrealized losses	(13,517)	(16,538)
Investment securities available-for-sale (at fair value)	866,714	884,232
Residential Mortgage Pass-Through Securities Issued or Guaranteed by U.S. Government Agencies or Sponsored Enterprises [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	192,369	223,781
Gross unrealized gains	3,476	3,909
Gross unrealized losses	(504)	(530)
Investment securities available-for-sale (at fair value)	195,341	227,160
Other Residential MBS Issued or Guaranteed by U.S. Government Agencies or Sponsored Enterprises [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	680,040	666,616
Gross unrealized gains	1,604	2,124
Gross unrealized losses	(13,013)	(16,001)
Investment securities available-for-sale (at fair value)	668,631	652,739
Municipal [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	2,323	3,921
Gross unrealized losses		(7)
Investment securities available-for-sale (at fair value)	2,323	3,914
Other Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	419	419
Investment securities available-for-sale (at fair value)	$ 419	$ 419

XML

Investment Securities - (Summary of Unrealized Losses) (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
Less than 12 months Fair Value	$ 228,367	$ 241,532
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss	(2,783)	(3,513)
12 months or more, Fair Value	354,843	385,707
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss	(10,734)	(13,025)
Total, Fair Value	583,210	627,239
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss	(13,517)	(16,538)
Residential Mortgage Pass-Through Securities Issued or Guaranteed by U.S. Government Agencies or Sponsored Enterprises [Member]
Schedule of Available-for-sale Securities [Line Items]
Less than 12 months Fair Value	79,548	100,898
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss	(504)	(530)
Total, Fair Value	79,548	100,898
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss	(504)	(530)
Other Residential MBS Issued or Guaranteed by U.S. Government Agencies or Sponsored Enterprises [Member]
Schedule of Available-for-sale Securities [Line Items]
Less than 12 months Fair Value	148,819	137,576
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss	(2,279)	(2,976)
12 months or more, Fair Value	354,843	385,707
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss	(10,734)	(13,025)
Total, Fair Value	503,662	523,283
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss	$ (13,013)	(16,001)
Municipal [Member]
Schedule of Available-for-sale Securities [Line Items]
Less than 12 months Fair Value		3,058
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss		(7)
Total, Fair Value		3,058
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss		$ (7)

XML

Investment Securities - (Summary of Held-to-maturity Investment Securities) (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Schedule of Held-to-maturity Securities [Line Items]
Held-to-maturity Securities	$ 294,891	$ 332,505
Held-to-maturity Securities, Accumulated Unrecognized Holding Gain	1,343	1,701
Held-to-maturity Securities, Accumulated Unrecognized Holding Loss	(1,365)	(1,633)
Fair value	294,869	332,573
Residential Mortgage Pass-Through Securities Issued or Guaranteed by U.S. Government Agencies or Sponsored Enterprises [Member]
Schedule of Held-to-maturity Securities [Line Items]
Held-to-maturity Securities	233,026	263,411
Held-to-maturity Securities, Accumulated Unrecognized Holding Gain	1,332	1,685
Held-to-maturity Securities, Accumulated Unrecognized Holding Loss	(164)	(234)
Fair value	234,194	264,862
Other Residential MBS Issued or Guaranteed by U.S. Government Agencies or Sponsored Enterprises [Member]
Schedule of Held-to-maturity Securities [Line Items]
Held-to-maturity Securities	61,865	69,094
Held-to-maturity Securities, Accumulated Unrecognized Holding Gain	11	16
Held-to-maturity Securities, Accumulated Unrecognized Holding Loss	(1,201)	(1,399)
Fair value	$ 60,675	$ 67,711

XML

Investment Securities - (Summary of Held-to-Maturity Securities, Unrealized Losses) (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Schedule of Held-to-maturity Securities [Line Items]
Fair Value, Less than 12 months	$ 49,373	$ 54,791
Held-to-maturity Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss	(470)	(591)
Fair Value, 12 months or more	29,244	32,146
Held-to-maturity Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss	(895)	(1,042)
Total Fair Value	78,617	86,937
Held-to-maturity Securities, Continuous Unrealized Loss Position, Accumulated Loss	(1,365)	(1,633)
Residential Mortgage Pass-Through Securities Issued or Guaranteed by U.S. Government Agencies or Sponsored Enterprises [Member]
Schedule of Held-to-maturity Securities [Line Items]
Fair Value, Less than 12 months	25,512	27,799
Held-to-maturity Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss	(164)	(234)
Total Fair Value	25,512	27,799
Held-to-maturity Securities, Continuous Unrealized Loss Position, Accumulated Loss	(164)	(234)
Other Residential MBS Issued or Guaranteed by U.S. Government Agencies or Sponsored Enterprises [Member]
Schedule of Held-to-maturity Securities [Line Items]
Fair Value, Less than 12 months	23,861	26,992
Held-to-maturity Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss	(306)	(357)
Fair Value, 12 months or more	29,244	32,146
Held-to-maturity Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss	(895)	(1,042)
Total Fair Value	53,105	59,138
Held-to-maturity Securities, Continuous Unrealized Loss Position, Accumulated Loss	$ (1,201)	$ (1,399)

XML

Loans - Narrative Section (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Debt Instrument [Line Items]
Fees and cost related to loans	$ 4,900		$ 4,900		$ 6,300
Carrying amount of loan investments	3,087,945	$ 2,738,504	3,087,945	$ 2,738,504	2,860,921
Commercial Loan [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	1,775,454		1,775,454		1,560,430
Non Accrual [Member]
Debt Instrument [Line Items]
Recorded investment, non-accrual status	32,500		32,500
Increase (decrease) in non-accrual loans			$ 1,700
Percentage increase (decrease) in past due loans			5.70%
Non Accrual [Member] | Owner-Occupied [Member]
Debt Instrument [Line Items]
Decrease related to loans resolved and/or charged-off			$ 2,200
Non Accrual [Member] | Other
Debt Instrument [Line Items]
Increase (decrease) in non-accrual loans			(500)
Non ASC 310-30 [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	2,953,518		2,953,518		2,715,069
Allowance for Loan and Lease Losses, Write-offs	121	3,686	331	4,345
Non ASC 310-30 [Member] | Commercial Loan [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	1,739,476		1,739,476		1,521,150
ASC 310-30 [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	134,427		134,427		145,852
Allowance for Loan and Lease Losses, Write-offs		$ 41		$ 41
ASC 310-30 [Member] | Commercial Loan [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	35,978		35,978		39,280
Total Loans [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	3,087,945		3,087,945		2,860,921
Total Loans [Member] | Non ASC 310-30 [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	2,953,518		2,953,518		2,715,069
Recorded investment, non-accrual status	32,455		32,455		30,717
Total past due loans	18,360		18,360		19,435
Total Loans [Member] | Non ASC 310-30 [Member] | Commercial and Industrial [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	1,275,855		1,275,855		1,074,696
Recorded investment, non-accrual status	7,780		7,780		8,688
Total past due loans	5,021		5,021		8,221
Total Loans [Member] | Non ASC 310-30 [Member] | Energy Loans [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	98,293		98,293		90,273
Recorded investment, non-accrual status	12,050		12,050		12,645
Total past due loans	6,613		6,613		6,550
Total Loans [Member] | Non ASC 310-30 [Member] | Commercial Loan [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	1,739,476		1,739,476		1,521,150
Recorded investment, non-accrual status	26,415		26,415		25,294
Total past due loans	13,523		13,523		16,127
Total Loans [Member] | Non ASC 310-30 [Member] | Owner-Occupied [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	233,930		233,930		221,544
Recorded investment, non-accrual status	4,377		4,377		2,056
Total past due loans	942		942		855
Total Loans [Member] | Non ASC 310-30 [Member] | Non Owner-Occupied [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	293,807		293,807		309,068
Recorded investment, non-accrual status	35		35		66
Total past due loans	135		135		28
Total Loans [Member] | ASC 310-30 [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	134,427		134,427		145,852
Total Loans [Member] | ASC 310-30 [Member] | Commercial Loan [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	35,978		35,978		39,280
Total Loans [Member] | Substandard [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	77,529		77,529		116,558
Total Loans [Member] | Substandard [Member] | Non ASC 310-30 [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	40,712		40,712		56,924
Total Loans [Member] | Substandard [Member] | Non ASC 310-30 [Member] | Commercial and Industrial [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	15,472		15,472		25,636
Total Loans [Member] | Substandard [Member] | Non ASC 310-30 [Member] | Energy Loans [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	5,998		5,998		7,811
Total Loans [Member] | Substandard [Member] | Non ASC 310-30 [Member] | Commercial Loan [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	30,340		30,340		45,490
Total Loans [Member] | Substandard [Member] | Non ASC 310-30 [Member] | Owner-Occupied [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	6,196		6,196		10,137
Increase (decrease) in loan investments			1,400
Total Loans [Member] | Substandard [Member] | Non ASC 310-30 [Member] | Non Owner-Occupied [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	1,234		1,234		2,251
Total Loans [Member] | Substandard [Member] | ASC 310-30 [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	36,817		36,817		59,634
Total Loans [Member] | Substandard [Member] | ASC 310-30 [Member] | Commercial Loan [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	7,074		7,074		11,234
Total Loans [Member] | Special Mention [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	49,530		49,530		38,590
Total Loans [Member] | Special Mention [Member] | Non ASC 310-30 [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	45,624		45,624		35,669
Total Loans [Member] | Special Mention [Member] | Non ASC 310-30 [Member] | Commercial and Industrial [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	13,978		13,978		7,243
Increase (decrease) in loan investments			(6,200)
Total Loans [Member] | Special Mention [Member] | Non ASC 310-30 [Member] | Commercial Loan [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	41,253		41,253		25,536
Total Loans [Member] | Special Mention [Member] | Non ASC 310-30 [Member] | Owner-Occupied [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	4,607		4,607		9,371
Increase (decrease) in loan investments			5,500
Total Loans [Member] | Special Mention [Member] | Non ASC 310-30 [Member] | Non Owner-Occupied [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	1,566		1,566		5,895
Total Loans [Member] | Special Mention [Member] | ASC 310-30 [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	3,906		3,906		2,921
Total Loans [Member] | Special Mention [Member] | ASC 310-30 [Member] | Commercial Loan [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	1,105		1,105		610
Total Loans [Member] | Doubtful [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	9,111		9,111		9,113
Total Loans [Member] | Doubtful [Member] | Non ASC 310-30 [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	9,111		9,111		5,345
Total Loans [Member] | Doubtful [Member] | Non ASC 310-30 [Member] | Commercial and Industrial [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	2,767		2,767		491
Increase (decrease) in loan investments			2,100
Total Loans [Member] | Doubtful [Member] | Non ASC 310-30 [Member] | Energy Loans [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	6,052		6,052		4,843
Total Loans [Member] | Doubtful [Member] | Non ASC 310-30 [Member] | Commercial Loan [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	9,098		9,098		5,334
Total Loans [Member] | Doubtful [Member] | Non ASC 310-30 [Member] | Owner-Occupied [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	$ 245		$ 245
Total Loans [Member] | Doubtful [Member] | ASC 310-30 [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments					$ 3,768

XML

Loans - Impaired Loans Narrative (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016	Jun. 30, 2016
Debt Instrument [Line Items]
Carrying amount of loan investments	$ 3,087,945	$ 2,860,921	$ 2,738,504
Impaired loans	24,600
Recorded investment of impaired loans	39,379	38,282
Collective related allowance for loan losses for impaired loans	6,246	2,408
Non Accrual [Member]
Debt Instrument [Line Items]
Investment in impaired loans not covered by loan loss, non-accrual status	32,500
Fair Value Of Collateral Pledged [Member]
Debt Instrument [Line Items]
Impaired loans	29,000
Discounted Cash Flows [Member]
Debt Instrument [Line Items]
Impaired loans	2,500
General Reserve [Member]
Debt Instrument [Line Items]
Impaired loans	7,900
Individual loan amount of impaired loans	250
Commercial Loan [Member]
Debt Instrument [Line Items]
Carrying amount of loan investments	$ 1,775,454	$ 1,560,430

XML

Loans - (Loan Portfolio Composition Including Carrying Value by Segment of Loans Accounted for under ASC Topic 310-30) (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016	Jun. 30, 2016
Loans [Line Items]
Total Loans	$ 3,087,945	$ 2,860,921	$ 2,738,504
% of Total	100.00%	100.00%
Commercial Loan [Member]
Loans [Line Items]
Total Loans	$ 1,775,454	$ 1,560,430
% of Total	57.50%	54.60%
Commercial Real Estate [Member]
Loans [Line Items]
Total Loans	$ 557,020	$ 526,792
% of Total	18.00%	18.40%
Residential Real Estate Segment [Member]
Loans [Line Items]
Total Loans	$ 728,511	$ 744,885
% of Total	23.60%	26.00%
Consumer [Member]
Loans [Line Items]
Total Loans	$ 26,960	$ 28,814
% of Total	0.90%	1.00%
ASC 310-30 [Member]
Loans [Line Items]
Total Loans	$ 134,427	$ 145,852
ASC 310-30 [Member] | Commercial Loan [Member]
Loans [Line Items]
Total Loans	35,978	39,280
ASC 310-30 [Member] | Commercial Real Estate [Member]
Loans [Line Items]
Total Loans	83,785	89,150
ASC 310-30 [Member] | Residential Real Estate Segment [Member]
Loans [Line Items]
Total Loans	14,012	16,524
ASC 310-30 [Member] | Consumer [Member]
Loans [Line Items]
Total Loans	652	898
Non ASC 310-30 [Member]
Loans [Line Items]
Total Loans	2,953,518	2,715,069
Non ASC 310-30 [Member] | Commercial Loan [Member]
Loans [Line Items]
Total Loans	1,739,476	1,521,150
Non ASC 310-30 [Member] | Commercial Real Estate [Member]
Loans [Line Items]
Total Loans	473,235	437,642
Non ASC 310-30 [Member] | Residential Real Estate Segment [Member]
Loans [Line Items]
Total Loans	714,499	728,361
Non ASC 310-30 [Member] | Consumer [Member]
Loans [Line Items]
Total Loans	$ 26,308	$ 27,916

XML

Loans - (Loan Delinquency) (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016	Jun. 30, 2016
Loans [Line Items]
Total loans	$ 3,087,945	$ 2,860,921	$ 2,738,504
Commercial Loan [Member]
Loans [Line Items]
Total loans	1,775,454	1,560,430
Commercial Real Estate [Member]
Loans [Line Items]
Total loans	557,020	526,792
Residential Real Estate Segment [Member]
Loans [Line Items]
Total loans	728,511	744,885
Consumer [Member]
Loans [Line Items]
Total loans	26,960	28,814
Non ASC 310-30 [Member]
Loans [Line Items]
Total loans	2,953,518	2,715,069
Non ASC 310-30 [Member] | Commercial Loan [Member]
Loans [Line Items]
Total loans	1,739,476	1,521,150
Non ASC 310-30 [Member] | Commercial Real Estate [Member]
Loans [Line Items]
Total loans	473,235	437,642
Non ASC 310-30 [Member] | Residential Real Estate Segment [Member]
Loans [Line Items]
Total loans	714,499	728,361
Non ASC 310-30 [Member] | Consumer [Member]
Loans [Line Items]
Total loans	26,308	27,916
ASC 310-30 [Member]
Loans [Line Items]
Total loans	134,427	145,852
ASC 310-30 [Member] | Commercial Loan [Member]
Loans [Line Items]
Total loans	35,978	39,280
ASC 310-30 [Member] | Commercial Real Estate [Member]
Loans [Line Items]
Total loans	83,785	89,150
ASC 310-30 [Member] | Residential Real Estate Segment [Member]
Loans [Line Items]
Total loans	14,012	16,524
ASC 310-30 [Member] | Consumer [Member]
Loans [Line Items]
Total loans	652	898
Total Loans [Member]
Loans [Line Items]
Total loans	3,087,945	2,860,921
Total Loans [Member] | Non ASC 310-30 [Member]
Loans [Line Items]
Total past due loans	18,360	19,435
Current	2,935,158	2,695,634
Total loans	2,953,518	2,715,069
Loans 90 days past due and still accruing	215
Non- accrual	32,455	30,717
Total Loans [Member] | Non ASC 310-30 [Member] | Commercial Construction [Member]
Loans [Line Items]
Total past due loans	215
Current	121,441	90,314
Total loans	121,656	90,314
Loans 90 days past due and still accruing	215
Total Loans [Member] | Non ASC 310-30 [Member] | Commercial Acquisition/Development [Member]
Loans [Line Items]
Total past due loans	334
Current	16,008	13,306
Total loans	16,342	13,306
Total Loans [Member] | Non ASC 310-30 [Member] | Multifamily [Member]
Loans [Line Items]
Current	41,430	24,954
Total loans	41,430	24,954
Total Loans [Member] | Non ASC 310-30 [Member] | Commercial and Industrial [Member]
Loans [Line Items]
Total past due loans	5,021	8,221
Current	1,270,834	1,066,475
Total loans	1,275,855	1,074,696
Non- accrual	7,780	8,688
Total Loans [Member] | Non ASC 310-30 [Member] | Owner-Occupied [Member]
Loans [Line Items]
Total past due loans	942	855
Current	232,988	220,689
Total loans	233,930	221,544
Non- accrual	4,377	2,056
Total Loans [Member] | Non ASC 310-30 [Member] | Non Owner-Occupied [Member]
Loans [Line Items]
Total past due loans	135	28
Current	293,672	309,040
Total loans	293,807	309,068
Non- accrual	35	66
Total Loans [Member] | Non ASC 310-30 [Member] | Total Commercial Real Estate [Member]
Loans [Line Items]
Total past due loans	684	28
Current	472,551	437,614
Total loans	473,235	437,642
Loans 90 days past due and still accruing	215
Non- accrual	35	66
Total Loans [Member] | Non ASC 310-30 [Member] | Senior lien
Loans [Line Items]
Total past due loans	3,819	2,991
Current	658,403	672,699
Total loans	662,222	675,690
Non- accrual	5,286	4,522
Total Loans [Member] | Non ASC 310-30 [Member] | Junior lien
Loans [Line Items]
Total past due loans	240	198
Current	52,037	52,473
Total loans	52,277	52,671
Non- accrual	557	654
Total Loans [Member] | Non ASC 310-30 [Member] | Commercial Loan [Member]
Loans [Line Items]
Total past due loans	13,523	16,127
Current	1,725,953	1,505,023
Total loans	1,739,476	1,521,150
Non- accrual	26,415	25,294
Total Loans [Member] | Non ASC 310-30 [Member] | Agriculture [Member]
Loans [Line Items]
Total past due loans	947	501
Current	130,451	134,136
Total loans	131,398	134,637
Non- accrual	2,208	1,905
Total Loans [Member] | Non ASC 310-30 [Member] | Energy Loans [Member]
Loans [Line Items]
Total past due loans	6,613	6,550
Current	91,680	83,723
Total loans	98,293	90,273
Non- accrual	12,050	12,645
Total Loans [Member] | Non ASC 310-30 [Member] | Residential Real Estate Segment [Member]
Loans [Line Items]
Total past due loans	4,059	3,189
Current	710,440	725,172
Total loans	714,499	728,361
Non- accrual	5,843	5,176
Total Loans [Member] | Non ASC 310-30 [Member] | Consumer [Member]
Loans [Line Items]
Total past due loans	94	91
Current	26,214	27,825
Total loans	26,308	27,916
Non- accrual	162	181
Total Loans [Member] | ASC 310-30 [Member]
Loans [Line Items]
Total loans	134,427	145,852
Total Loans [Member] | ASC 310-30 [Member] | Commercial Loan [Member]
Loans [Line Items]
Total loans	35,978	39,280
Total Loans [Member] | ASC 310-30 [Member] | Commercial Real Estate [Member]
Loans [Line Items]
Total loans	83,785	89,150
Total Loans [Member] | ASC 310-30 [Member] | Residential Real Estate Segment [Member]
Loans [Line Items]
Total loans	14,012	16,524
Total Loans [Member] | ASC 310-30 [Member] | Consumer [Member]
Loans [Line Items]
Total loans	652	898
Total Loans [Member] | 30-59 Days Past Due | Non ASC 310-30 [Member]
Loans [Line Items]
Total past due loans	3,637	5,306
Total Loans [Member] | 30-59 Days Past Due | Non ASC 310-30 [Member] | Commercial Acquisition/Development [Member]
Loans [Line Items]
Total past due loans	334
Total Loans [Member] | 30-59 Days Past Due | Non ASC 310-30 [Member] | Commercial and Industrial [Member]
Loans [Line Items]
Total past due loans	658	3,134
Total Loans [Member] | 30-59 Days Past Due | Non ASC 310-30 [Member] | Owner-Occupied [Member]
Loans [Line Items]
Total past due loans	890	583
Total Loans [Member] | 30-59 Days Past Due | Non ASC 310-30 [Member] | Non Owner-Occupied [Member]
Loans [Line Items]
Total past due loans	135
Total Loans [Member] | 30-59 Days Past Due | Non ASC 310-30 [Member] | Total Commercial Real Estate [Member]
Loans [Line Items]
Total past due loans	469
Total Loans [Member] | 30-59 Days Past Due | Non ASC 310-30 [Member] | Senior lien
Loans [Line Items]
Total past due loans	854	888
Total Loans [Member] | 30-59 Days Past Due | Non ASC 310-30 [Member] | Junior lien
Loans [Line Items]
Total past due loans	185	115
Total Loans [Member] | 30-59 Days Past Due | Non ASC 310-30 [Member] | Commercial Loan [Member]
Loans [Line Items]
Total past due loans	2,060	4,220
Total Loans [Member] | 30-59 Days Past Due | Non ASC 310-30 [Member] | Agriculture [Member]
Loans [Line Items]
Total past due loans	512	501
Total Loans [Member] | 30-59 Days Past Due | Non ASC 310-30 [Member] | Energy Loans [Member]
Loans [Line Items]
Total past due loans		2
Total Loans [Member] | 30-59 Days Past Due | Non ASC 310-30 [Member] | Residential Real Estate Segment [Member]
Loans [Line Items]
Total past due loans	1,039	1,003
Total Loans [Member] | 30-59 Days Past Due | Non ASC 310-30 [Member] | Consumer [Member]
Loans [Line Items]
Total past due loans	69	83
Total Loans [Member] | 60-89 Days Past Due | Non ASC 310-30 [Member]
Loans [Line Items]
Total past due loans	1,961	4,939
Total Loans [Member] | 60-89 Days Past Due | Non ASC 310-30 [Member] | Commercial and Industrial [Member]
Loans [Line Items]
Total past due loans	228	4,009
Total Loans [Member] | 60-89 Days Past Due | Non ASC 310-30 [Member] | Owner-Occupied [Member]
Loans [Line Items]
Total past due loans		216
Total Loans [Member] | 60-89 Days Past Due | Non ASC 310-30 [Member] | Senior lien
Loans [Line Items]
Total past due loans	1,667	645
Total Loans [Member] | 60-89 Days Past Due | Non ASC 310-30 [Member] | Junior lien
Loans [Line Items]
Total past due loans	47	61
Total Loans [Member] | 60-89 Days Past Due | Non ASC 310-30 [Member] | Commercial Loan [Member]
Loans [Line Items]
Total past due loans	228	4,225
Total Loans [Member] | 60-89 Days Past Due | Non ASC 310-30 [Member] | Residential Real Estate Segment [Member]
Loans [Line Items]
Total past due loans	1,714	706
Total Loans [Member] | 60-89 Days Past Due | Non ASC 310-30 [Member] | Consumer [Member]
Loans [Line Items]
Total past due loans	19	8
Total Loans [Member] | Greater than 90 Days Past Due | Non ASC 310-30 [Member]
Loans [Line Items]
Total past due loans	12,762	9,190
Total Loans [Member] | Greater than 90 Days Past Due | Non ASC 310-30 [Member] | Commercial Construction [Member]
Loans [Line Items]
Total past due loans	215
Total Loans [Member] | Greater than 90 Days Past Due | Non ASC 310-30 [Member] | Commercial and Industrial [Member]
Loans [Line Items]
Total past due loans	4,135	1,078
Total Loans [Member] | Greater than 90 Days Past Due | Non ASC 310-30 [Member] | Owner-Occupied [Member]
Loans [Line Items]
Total past due loans	52	56
Total Loans [Member] | Greater than 90 Days Past Due | Non ASC 310-30 [Member] | Non Owner-Occupied [Member]
Loans [Line Items]
Total past due loans		28
Total Loans [Member] | Greater than 90 Days Past Due | Non ASC 310-30 [Member] | Total Commercial Real Estate [Member]
Loans [Line Items]
Total past due loans	215	28
Total Loans [Member] | Greater than 90 Days Past Due | Non ASC 310-30 [Member] | Senior lien
Loans [Line Items]
Total past due loans	1,298	1,458
Total Loans [Member] | Greater than 90 Days Past Due | Non ASC 310-30 [Member] | Junior lien
Loans [Line Items]
Total past due loans	8	22
Total Loans [Member] | Greater than 90 Days Past Due | Non ASC 310-30 [Member] | Commercial Loan [Member]
Loans [Line Items]
Total past due loans	11,235	7,682
Total Loans [Member] | Greater than 90 Days Past Due | Non ASC 310-30 [Member] | Agriculture [Member]
Loans [Line Items]
Total past due loans	435
Total Loans [Member] | Greater than 90 Days Past Due | Non ASC 310-30 [Member] | Energy Loans [Member]
Loans [Line Items]
Total past due loans	6,613	6,548
Total Loans [Member] | Greater than 90 Days Past Due | Non ASC 310-30 [Member] | Residential Real Estate Segment [Member]
Loans [Line Items]
Total past due loans	1,306	$ 1,480
Total Loans [Member] | Greater than 90 Days Past Due | Non ASC 310-30 [Member] | Consumer [Member]
Loans [Line Items]
Total past due loans	6
Non Accrual [Member]
Loans [Line Items]
Non- accrual	$ 32,500

XML

Loans - (Credit Exposure for Loans as Determined by Company's Internal Risk Rating System) (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016	Jun. 30, 2016
Loans [Line Items]
Total Loans	$ 3,087,945	$ 2,860,921	$ 2,738,504
Commercial Loan [Member]
Loans [Line Items]
Total Loans	1,775,454	1,560,430
Residential Real Estate Segment [Member]
Loans [Line Items]
Total Loans	728,511	744,885
Consumer [Member]
Loans [Line Items]
Total Loans	26,960	28,814
Commercial Real Estate [Member]
Loans [Line Items]
Total Loans	557,020	526,792
Non ASC 310-30 [Member]
Loans [Line Items]
Total Loans	2,953,518	2,715,069
Non ASC 310-30 [Member] | Commercial Loan [Member]
Loans [Line Items]
Total Loans	1,739,476	1,521,150
Non ASC 310-30 [Member] | Residential Real Estate Segment [Member]
Loans [Line Items]
Total Loans	714,499	728,361
Non ASC 310-30 [Member] | Consumer [Member]
Loans [Line Items]
Total Loans	26,308	27,916
Non ASC 310-30 [Member] | Commercial Real Estate [Member]
Loans [Line Items]
Total Loans	473,235	437,642
ASC 310-30 [Member]
Loans [Line Items]
Total Loans	134,427	145,852
ASC 310-30 [Member] | Commercial Loan [Member]
Loans [Line Items]
Total Loans	35,978	39,280
ASC 310-30 [Member] | Residential Real Estate Segment [Member]
Loans [Line Items]
Total Loans	14,012	16,524
ASC 310-30 [Member] | Consumer [Member]
Loans [Line Items]
Total Loans	652	898
ASC 310-30 [Member] | Commercial Real Estate [Member]
Loans [Line Items]
Total Loans	83,785	89,150
Total Loans [Member]
Loans [Line Items]
Total Loans	3,087,945	2,860,921
Total Loans [Member] | Non ASC 310-30 [Member]
Loans [Line Items]
Total Loans	2,953,518	2,715,069
Total Loans [Member] | Non ASC 310-30 [Member] | Commercial and Industrial [Member]
Loans [Line Items]
Total Loans	1,275,855	1,074,696
Total Loans [Member] | Non ASC 310-30 [Member] | Agriculture [Member]
Loans [Line Items]
Total Loans	131,398	134,637
Total Loans [Member] | Non ASC 310-30 [Member] | Energy Loans [Member]
Loans [Line Items]
Total Loans	98,293	90,273
Total Loans [Member] | Non ASC 310-30 [Member] | Commercial Loan [Member]
Loans [Line Items]
Total Loans	1,739,476	1,521,150
Total Loans [Member] | Non ASC 310-30 [Member] | Total Commercial Real Estate [Member]
Loans [Line Items]
Total Loans	473,235	437,642
Total Loans [Member] | Non ASC 310-30 [Member] | Commercial Construction [Member]
Loans [Line Items]
Total Loans	121,656	90,314
Total Loans [Member] | Non ASC 310-30 [Member] | Commercial Acquisition/Development [Member]
Loans [Line Items]
Total Loans	16,342	13,306
Total Loans [Member] | Non ASC 310-30 [Member] | Multifamily [Member]
Loans [Line Items]
Total Loans	41,430	24,954
Total Loans [Member] | Non ASC 310-30 [Member] | Owner-Occupied [Member]
Loans [Line Items]
Total Loans	233,930	221,544
Total Loans [Member] | Non ASC 310-30 [Member] | Non Owner-Occupied [Member]
Loans [Line Items]
Total Loans	293,807	309,068
Total Loans [Member] | Non ASC 310-30 [Member] | Residential Real Estate Segment [Member]
Loans [Line Items]
Total Loans	714,499	728,361
Total Loans [Member] | Non ASC 310-30 [Member] | Senior lien
Loans [Line Items]
Total Loans	662,222	675,690
Total Loans [Member] | Non ASC 310-30 [Member] | Junior lien
Loans [Line Items]
Total Loans	52,277	52,671
Total Loans [Member] | Non ASC 310-30 [Member] | Consumer [Member]
Loans [Line Items]
Total Loans	26,308	27,916
Total Loans [Member] | ASC 310-30 [Member]
Loans [Line Items]
Total Loans	134,427	145,852
Total Loans [Member] | ASC 310-30 [Member] | Commercial Loan [Member]
Loans [Line Items]
Total Loans	35,978	39,280
Total Loans [Member] | ASC 310-30 [Member] | Residential Real Estate Segment [Member]
Loans [Line Items]
Total Loans	14,012	16,524
Total Loans [Member] | ASC 310-30 [Member] | Consumer [Member]
Loans [Line Items]
Total Loans	652	898
Total Loans [Member] | ASC 310-30 [Member] | Commercial Real Estate [Member]
Loans [Line Items]
Total Loans	83,785	89,150
Total Loans [Member] | Pass [Member]
Loans [Line Items]
Total Loans	2,951,775	2,696,660
Total Loans [Member] | Pass [Member] | Non ASC 310-30 [Member]
Loans [Line Items]
Total Loans	2,858,071	2,617,131
Total Loans [Member] | Pass [Member] | Non ASC 310-30 [Member] | Commercial and Industrial [Member]
Loans [Line Items]
Total Loans	1,243,638	1,041,326
Total Loans [Member] | Pass [Member] | Non ASC 310-30 [Member] | Agriculture [Member]
Loans [Line Items]
Total Loans	106,022	123,809
Total Loans [Member] | Pass [Member] | Non ASC 310-30 [Member] | Energy Loans [Member]
Loans [Line Items]
Total Loans	86,243	77,619
Total Loans [Member] | Pass [Member] | Non ASC 310-30 [Member] | Commercial Loan [Member]
Loans [Line Items]
Total Loans	1,658,785	1,444,790
Total Loans [Member] | Pass [Member] | Non ASC 310-30 [Member] | Total Commercial Real Estate [Member]
Loans [Line Items]
Total Loans	465,547	424,274
Total Loans [Member] | Pass [Member] | Non ASC 310-30 [Member] | Commercial Construction [Member]
Loans [Line Items]
Total Loans	121,441	90,099
Total Loans [Member] | Pass [Member] | Non ASC 310-30 [Member] | Commercial Acquisition/Development [Member]
Loans [Line Items]
Total Loans	13,844	10,758
Total Loans [Member] | Pass [Member] | Non ASC 310-30 [Member] | Multifamily [Member]
Loans [Line Items]
Total Loans	39,255	22,495
Total Loans [Member] | Pass [Member] | Non ASC 310-30 [Member] | Owner-Occupied [Member]
Loans [Line Items]
Total Loans	222,882	202,036
Total Loans [Member] | Pass [Member] | Non ASC 310-30 [Member] | Non Owner-Occupied [Member]
Loans [Line Items]
Total Loans	291,007	300,922
Total Loans [Member] | Pass [Member] | Non ASC 310-30 [Member] | Residential Real Estate Segment [Member]
Loans [Line Items]
Total Loans	707,653	720,398
Total Loans [Member] | Pass [Member] | Non ASC 310-30 [Member] | Senior lien
Loans [Line Items]
Total Loans	656,249	669,148
Total Loans [Member] | Pass [Member] | Non ASC 310-30 [Member] | Junior lien
Loans [Line Items]
Total Loans	51,404	51,250
Total Loans [Member] | Pass [Member] | Non ASC 310-30 [Member] | Consumer [Member]
Loans [Line Items]
Total Loans	26,086	27,669
Total Loans [Member] | Pass [Member] | ASC 310-30 [Member]
Loans [Line Items]
Total Loans	93,704	79,529
Total Loans [Member] | Pass [Member] | ASC 310-30 [Member] | Commercial Loan [Member]
Loans [Line Items]
Total Loans	27,799	27,436
Total Loans [Member] | Pass [Member] | ASC 310-30 [Member] | Residential Real Estate Segment [Member]
Loans [Line Items]
Total Loans	11,234	12,477
Total Loans [Member] | Pass [Member] | ASC 310-30 [Member] | Consumer [Member]
Loans [Line Items]
Total Loans	464	721
Total Loans [Member] | Pass [Member] | ASC 310-30 [Member] | Commercial Real Estate [Member]
Loans [Line Items]
Total Loans	54,207	38,895
Total Loans [Member] | Special Mention [Member]
Loans [Line Items]
Total Loans	49,530	38,590
Total Loans [Member] | Special Mention [Member] | Non ASC 310-30 [Member]
Loans [Line Items]
Total Loans	45,624	35,669
Total Loans [Member] | Special Mention [Member] | Non ASC 310-30 [Member] | Commercial and Industrial [Member]
Loans [Line Items]
Total Loans	13,978	7,243
Total Loans [Member] | Special Mention [Member] | Non ASC 310-30 [Member] | Agriculture [Member]
Loans [Line Items]
Total Loans	22,668	8,922
Total Loans [Member] | Special Mention [Member] | Non ASC 310-30 [Member] | Commercial Loan [Member]
Loans [Line Items]
Total Loans	41,253	25,536
Total Loans [Member] | Special Mention [Member] | Non ASC 310-30 [Member] | Total Commercial Real Estate [Member]
Loans [Line Items]
Total Loans	4,064	8,681
Total Loans [Member] | Special Mention [Member] | Non ASC 310-30 [Member] | Commercial Acquisition/Development [Member]
Loans [Line Items]
Total Loans	2,498	2,548
Total Loans [Member] | Special Mention [Member] | Non ASC 310-30 [Member] | Multifamily [Member]
Loans [Line Items]
Total Loans		238
Total Loans [Member] | Special Mention [Member] | Non ASC 310-30 [Member] | Owner-Occupied [Member]
Loans [Line Items]
Total Loans	4,607	9,371
Total Loans [Member] | Special Mention [Member] | Non ASC 310-30 [Member] | Non Owner-Occupied [Member]
Loans [Line Items]
Total Loans	1,566	5,895
Total Loans [Member] | Special Mention [Member] | Non ASC 310-30 [Member] | Residential Real Estate Segment [Member]
Loans [Line Items]
Total Loans	251	1,393
Total Loans [Member] | Special Mention [Member] | Non ASC 310-30 [Member] | Senior lien
Loans [Line Items]
Total Loans	251	1,215
Total Loans [Member] | Special Mention [Member] | Non ASC 310-30 [Member] | Junior lien
Loans [Line Items]
Total Loans		178
Total Loans [Member] | Special Mention [Member] | Non ASC 310-30 [Member] | Consumer [Member]
Loans [Line Items]
Total Loans	56	59
Total Loans [Member] | Special Mention [Member] | ASC 310-30 [Member]
Loans [Line Items]
Total Loans	3,906	2,921
Total Loans [Member] | Special Mention [Member] | ASC 310-30 [Member] | Commercial Loan [Member]
Loans [Line Items]
Total Loans	1,105	610
Total Loans [Member] | Special Mention [Member] | ASC 310-30 [Member] | Residential Real Estate Segment [Member]
Loans [Line Items]
Total Loans	1,088	1,327
Total Loans [Member] | Special Mention [Member] | ASC 310-30 [Member] | Consumer [Member]
Loans [Line Items]
Total Loans	12	17
Total Loans [Member] | Special Mention [Member] | ASC 310-30 [Member] | Commercial Real Estate [Member]
Loans [Line Items]
Total Loans	1,701	967
Total Loans [Member] | Substandard [Member]
Loans [Line Items]
Total Loans	77,529	116,558
Total Loans [Member] | Substandard [Member] | Non ASC 310-30 [Member]
Loans [Line Items]
Total Loans	40,712	56,924
Total Loans [Member] | Substandard [Member] | Non ASC 310-30 [Member] | Commercial and Industrial [Member]
Loans [Line Items]
Total Loans	15,472	25,636
Total Loans [Member] | Substandard [Member] | Non ASC 310-30 [Member] | Agriculture [Member]
Loans [Line Items]
Total Loans	2,674	1,906
Total Loans [Member] | Substandard [Member] | Non ASC 310-30 [Member] | Energy Loans [Member]
Loans [Line Items]
Total Loans	5,998	7,811
Total Loans [Member] | Substandard [Member] | Non ASC 310-30 [Member] | Commercial Loan [Member]
Loans [Line Items]
Total Loans	30,340	45,490
Total Loans [Member] | Substandard [Member] | Non ASC 310-30 [Member] | Total Commercial Real Estate [Member]
Loans [Line Items]
Total Loans	3,624	4,687
Total Loans [Member] | Substandard [Member] | Non ASC 310-30 [Member] | Commercial Construction [Member]
Loans [Line Items]
Total Loans	215	215
Total Loans [Member] | Substandard [Member] | Non ASC 310-30 [Member] | Multifamily [Member]
Loans [Line Items]
Total Loans	2,175	2,221
Total Loans [Member] | Substandard [Member] | Non ASC 310-30 [Member] | Owner-Occupied [Member]
Loans [Line Items]
Total Loans	6,196	10,137
Total Loans [Member] | Substandard [Member] | Non ASC 310-30 [Member] | Non Owner-Occupied [Member]
Loans [Line Items]
Total Loans	1,234	2,251
Total Loans [Member] | Substandard [Member] | Non ASC 310-30 [Member] | Residential Real Estate Segment [Member]
Loans [Line Items]
Total Loans	6,582	6,559
Total Loans [Member] | Substandard [Member] | Non ASC 310-30 [Member] | Senior lien
Loans [Line Items]
Total Loans	5,709	5,316
Total Loans [Member] | Substandard [Member] | Non ASC 310-30 [Member] | Junior lien
Loans [Line Items]
Total Loans	873	1,243
Total Loans [Member] | Substandard [Member] | Non ASC 310-30 [Member] | Consumer [Member]
Loans [Line Items]
Total Loans	166	188
Total Loans [Member] | Substandard [Member] | ASC 310-30 [Member]
Loans [Line Items]
Total Loans	36,817	59,634
Total Loans [Member] | Substandard [Member] | ASC 310-30 [Member] | Commercial Loan [Member]
Loans [Line Items]
Total Loans	7,074	11,234
Total Loans [Member] | Substandard [Member] | ASC 310-30 [Member] | Residential Real Estate Segment [Member]
Loans [Line Items]
Total Loans	1,690	2,720
Total Loans [Member] | Substandard [Member] | ASC 310-30 [Member] | Consumer [Member]
Loans [Line Items]
Total Loans	176	160
Total Loans [Member] | Substandard [Member] | ASC 310-30 [Member] | Commercial Real Estate [Member]
Loans [Line Items]
Total Loans	27,877	45,520
Total Loans [Member] | Doubtful [Member]
Loans [Line Items]
Total Loans	9,111	9,113
Total Loans [Member] | Doubtful [Member] | Non ASC 310-30 [Member]
Loans [Line Items]
Total Loans	9,111	5,345
Total Loans [Member] | Doubtful [Member] | Non ASC 310-30 [Member] | Commercial and Industrial [Member]
Loans [Line Items]
Total Loans	2,767	491
Total Loans [Member] | Doubtful [Member] | Non ASC 310-30 [Member] | Agriculture [Member]
Loans [Line Items]
Total Loans	34
Total Loans [Member] | Doubtful [Member] | Non ASC 310-30 [Member] | Energy Loans [Member]
Loans [Line Items]
Total Loans	6,052	4,843
Total Loans [Member] | Doubtful [Member] | Non ASC 310-30 [Member] | Commercial Loan [Member]
Loans [Line Items]
Total Loans	9,098	5,334
Total Loans [Member] | Doubtful [Member] | Non ASC 310-30 [Member] | Owner-Occupied [Member]
Loans [Line Items]
Total Loans	245
Total Loans [Member] | Doubtful [Member] | Non ASC 310-30 [Member] | Residential Real Estate Segment [Member]
Loans [Line Items]
Total Loans	13	11
Total Loans [Member] | Doubtful [Member] | Non ASC 310-30 [Member] | Senior lien
Loans [Line Items]
Total Loans	$ 13	11
Total Loans [Member] | Doubtful [Member] | ASC 310-30 [Member]
Loans [Line Items]
Total Loans		3,768
Total Loans [Member] | Doubtful [Member] | ASC 310-30 [Member] | Commercial Real Estate [Member]
Loans [Line Items]
Total Loans		$ 3,768

XML

Loans - (Additional Information Regarding Impaired Loans) (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Loans [Line Items]
Unpaid principal balance, Total	$ 53,531	$ 56,787
Recorded Investment In Acquired Impaired Loans	39,379	38,282
Loans and Leases Receivable, Allowance	6,246	2,408
Commercial and Industrial [Member]
Loans [Line Items]
Unpaid principal balance with no related allowance recorded	6,712	8,671
Recorded investment with no related allowance recorded	5,387	7,495
Unpaid principal balance of impaired loans with an allowance recorded	4,681	3,495
Recorded investment of impaired loans with an allowance recorded	4,642	3,464
Allowance for loan losses allocated with an allowance recorded	2,767	492
Agriculture [Member]
Loans [Line Items]
Unpaid principal balance with no related allowance recorded	1,581	2,044
Recorded investment with no related allowance recorded	1,377	1,987
Unpaid principal balance of impaired loans with an allowance recorded	938
Recorded investment of impaired loans with an allowance recorded	911
Allowance for loan losses allocated with an allowance recorded	35
Energy Loans [Member]
Loans [Line Items]
Unpaid principal balance with no related allowance recorded	16,548	17,142
Recorded investment with no related allowance recorded	5,437	6,105
Unpaid principal balance of impaired loans with an allowance recorded	6,613	11,216
Recorded investment of impaired loans with an allowance recorded	6,613	6,548
Allowance for loan losses allocated with an allowance recorded	3,148	1,866
Commercial Loan [Member]
Loans [Line Items]
Unpaid principal balance with no related allowance recorded	28,795	31,207
Recorded investment with no related allowance recorded	15,956	18,784
Unpaid principal balance of impaired loans with an allowance recorded	14,817	15,668
Recorded investment of impaired loans with an allowance recorded	14,502	10,654
Allowance for loan losses allocated with an allowance recorded	6,198	2,360
Multifamily [Member]
Loans [Line Items]
Unpaid principal balance with no related allowance recorded	31	33
Recorded investment with no related allowance recorded	31	33
Owner-Occupied [Member]
Loans [Line Items]
Unpaid principal balance with no related allowance recorded	3,954	3,350
Recorded investment with no related allowance recorded	3,755	3,197
Unpaid principal balance of impaired loans with an allowance recorded	2,585	957
Recorded investment of impaired loans with an allowance recorded	2,336	642
Allowance for loan losses allocated with an allowance recorded	248	2
Non Owner-Occupied [Member]
Loans [Line Items]
Unpaid principal balance with no related allowance recorded	357	394
Recorded investment with no related allowance recorded	306	343
Unpaid principal balance of impaired loans with an allowance recorded	220	261
Recorded investment of impaired loans with an allowance recorded	214	255
Allowance for loan losses allocated with an allowance recorded	1	1
Total Commercial Real Estate [Member]
Loans [Line Items]
Unpaid principal balance with no related allowance recorded	388	427
Recorded investment with no related allowance recorded	337	376
Unpaid principal balance of impaired loans with an allowance recorded	220	261
Recorded investment of impaired loans with an allowance recorded	214	255
Allowance for loan losses allocated with an allowance recorded	1	1
Senior lien
Loans [Line Items]
Unpaid principal balance with no related allowance recorded	345	1,551
Recorded investment with no related allowance recorded	328	1,426
Unpaid principal balance of impaired loans with an allowance recorded	7,162	5,646
Recorded investment of impaired loans with an allowance recorded	6,486	5,016
Allowance for loan losses allocated with an allowance recorded	36	31
Junior lien
Loans [Line Items]
Unpaid principal balance with no related allowance recorded		54
Recorded investment with no related allowance recorded		51
Unpaid principal balance of impaired loans with an allowance recorded	1,634	1,781
Recorded investment of impaired loans with an allowance recorded	1,391	1,532
Allowance for loan losses allocated with an allowance recorded	10	14
Residential Real Estate Segment [Member]
Loans [Line Items]
Unpaid principal balance with no related allowance recorded	345	1,605
Recorded investment with no related allowance recorded	328	1,477
Unpaid principal balance of impaired loans with an allowance recorded	8,796	7,427
Recorded investment of impaired loans with an allowance recorded	7,877	6,548
Allowance for loan losses allocated with an allowance recorded	46	45
Consumer [Member]
Loans [Line Items]
Unpaid principal balance with no related allowance recorded		4
Recorded investment with no related allowance recorded		4
Unpaid principal balance of impaired loans with an allowance recorded	170	188
Recorded investment of impaired loans with an allowance recorded	165	184
Allowance for loan losses allocated with an allowance recorded	1	2
Impaired Loans With No Related Allowance Recorded [Member] [Member]
Loans [Line Items]
Unpaid principal balance with no related allowance recorded	29,528	33,243
Recorded investment with no related allowance recorded	16,621	20,641
Impaired Loans With Related Allowance Recorded [Member]
Loans [Line Items]
Unpaid principal balance of impaired loans with an allowance recorded	24,003	23,544
Recorded investment of impaired loans with an allowance recorded	22,758	17,641
Allowance for loan losses allocated with an allowance recorded	$ 6,246	$ 2,408

XML

Loans - (Impaired Loans - Average Recorded Investment and Interest Income Recognized) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Loans [Line Items]
Impaired Financing Receivable, Average Recorded Investment	$ 41,073	$ 48,322	$ 41,863	$ 48,983
Impaired Financing Receivable, Interest Income, Cash Basis Method	95	155	211	317
Commercial and Industrial [Member]
Loans [Line Items]
Impaired Financing Receivable, with No Related Allowance, Average Recorded Investment	6,645	4,279	7,030	4,564
Impaired Financing Receivable, with No Related Allowance, Interest Income, Cash Basis Method	25	70	73	138
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment	4,643	4,144	4,630	4,312
Owner-Occupied [Member]
Loans [Line Items]
Impaired Financing Receivable, with No Related Allowance, Average Recorded Investment	3,789	1,825	3,834	1,869
Impaired Financing Receivable, with No Related Allowance, Interest Income, Cash Basis Method	23	20	41	49
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment	2,340	842	2,349	865
Impaired Financing Receivable, with Related Allowance, Interest Income, Cash Basis Method	7	4	11	7
Agriculture [Member]
Loans [Line Items]
Impaired Financing Receivable, with No Related Allowance, Average Recorded Investment	1,454	1,758	1,531	1,758
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment	912	178	914	179
Impaired Financing Receivable, with Related Allowance, Interest Income, Cash Basis Method	1	1	3	3
Energy Loans [Member]
Loans [Line Items]
Impaired Financing Receivable, with No Related Allowance, Average Recorded Investment	5,680		5,889
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment	6,624	25,975	6,602	26,005
Commercial Loan [Member]
Loans [Line Items]
Impaired Financing Receivable, with No Related Allowance, Average Recorded Investment	17,568	7,862	18,284	8,191
Impaired Financing Receivable, with No Related Allowance, Interest Income, Cash Basis Method	48	90	114	187
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment	14,519	31,139	14,495	31,361
Impaired Financing Receivable, with Related Allowance, Interest Income, Cash Basis Method	8	5	14	10
Multifamily [Member]
Loans [Line Items]
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment	31	35	31	36
Impaired Financing Receivable, with Related Allowance, Interest Income, Cash Basis Method			1	1
Non Owner-Occupied [Member]
Loans [Line Items]
Impaired Financing Receivable, with No Related Allowance, Average Recorded Investment	312		320
Impaired Financing Receivable, with No Related Allowance, Interest Income, Cash Basis Method	5		12
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment	216	814	220	823
Impaired Financing Receivable, with Related Allowance, Interest Income, Cash Basis Method	2	10	5	24
Total Commercial Real Estate [Member]
Loans [Line Items]
Impaired Financing Receivable, with No Related Allowance, Average Recorded Investment	312		320
Impaired Financing Receivable, with No Related Allowance, Interest Income, Cash Basis Method	5		12
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment	247	849	251	859
Impaired Financing Receivable, with Related Allowance, Interest Income, Cash Basis Method	2	10	6	25
Senior lien
Loans [Line Items]
Impaired Financing Receivable, with No Related Allowance, Average Recorded Investment	330	1,296	334	1,312
Impaired Financing Receivable, with No Related Allowance, Interest Income, Cash Basis Method		8		14
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment	6,525	5,149	6,583	5,212
Impaired Financing Receivable, with Related Allowance, Interest Income, Cash Basis Method	20	28	40	53
Junior lien
Loans [Line Items]
Impaired Financing Receivable, with No Related Allowance, Average Recorded Investment		134		136
Impaired Financing Receivable, with No Related Allowance, Interest Income, Cash Basis Method				1
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment	1,403	1,652	1,421	1,670
Impaired Financing Receivable, with Related Allowance, Interest Income, Cash Basis Method	12	14	25	27
Residential Real Estate Segment [Member]
Loans [Line Items]
Impaired Financing Receivable, with No Related Allowance, Average Recorded Investment	330	1,430	334	1,448
Impaired Financing Receivable, with No Related Allowance, Interest Income, Cash Basis Method		8		15
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment	7,928	6,801	8,004	6,882
Impaired Financing Receivable, with Related Allowance, Interest Income, Cash Basis Method	32	42	65	80
Consumer [Member]
Loans [Line Items]
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment	169	241	175	242
Impaired Loans With No Related Allowance Recorded [Member] [Member]
Loans [Line Items]
Impaired Financing Receivable, with No Related Allowance, Average Recorded Investment	18,210	9,292	18,938	9,639
Impaired Financing Receivable, with No Related Allowance, Interest Income, Cash Basis Method	53	98	126	202
Impaired Loans With Related Allowance Recorded [Member]
Loans [Line Items]
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment	22,863	39,030	22,925	39,344
Impaired Financing Receivable, with Related Allowance, Interest Income, Cash Basis Method	$ 42	$ 57	$ 85	$ 115

XML

Loans - Troubled Debt Restructuring and Loans Accounted for Under ASC Topic 310-30 Narratives (Details) $ in Millions	3 Months Ended	6 Months Ended
	Jun. 30, 2017 USD ($) item	Jun. 30, 2017 USD ($) loan item	Jun. 30, 2016 loan
Debt Instrument [Line Items]
TDR's modified within the past year that defaulted on their restructured terms | item		5
Troubled Debt Restructurings [Member]
Debt Instrument [Line Items]
TDR's modified within the past year that defaulted on their restructured terms	3		0
Number of restructured loans | item		5
Recorded investment	$ 6.8	$ 6.8
Energy Loans [Member]
Debt Instrument [Line Items]
TDR's modified within the past year that defaulted on their restructured terms | loan		1
Financing Receivable, Modifications, Subsequent Default, Recorded Investment		$ 2.9
Commercial Loan [Member]
Debt Instrument [Line Items]
Financing Receivable, Modifications, Subsequent Default, Recorded Investment		$ 4.2

XML

Loans - (Additional Information Related to Accruing TDR's) (Details) - Accruing TDR [Member] - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Loans [Line Items]
Recorded investment	$ 5,177	$ 5,767
Average year-to- date recorded investment	5,235	6,017
Unpaid principal balance	5,470	6,030
Unfunded commitments to fund TDRs	102	102
Commercial [Member]
Loans [Line Items]
Recorded investment	3,258	3,302
Average year-to- date recorded investment	3,270	3,440
Unpaid principal balance	3,488	3,464
Unfunded commitments to fund TDRs	100	100
Commercial Real Estate [Member]
Loans [Line Items]
Recorded investment	491	538
Average year-to- date recorded investment	510	572
Unpaid principal balance	543	590
Residential Real Estate Segment [Member]
Loans [Line Items]
Recorded investment	1,424	1,920
Average year-to- date recorded investment	1,450	1,996
Unpaid principal balance	1,435	1,969
Unfunded commitments to fund TDRs	2	2
Consumer [Member]
Loans [Line Items]
Recorded investment	4	7
Average year-to- date recorded investment	5	9
Unpaid principal balance	$ 4	$ 7

XML

Loans - (Summary of Company's Carrying Value of Non-Accrual TDR's) (Details) - Non-Accruing TDR [Member] - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Loans [Line Items]
Carrying Value of Non - Accruing TDR's	$ 21,681	$ 16,708
Commercial [Member]
Loans [Line Items]
Carrying Value of Non - Accruing TDR's	20,246	15,265
Residential Real Estate Segment [Member]
Loans [Line Items]
Carrying Value of Non - Accruing TDR's	1,308	1,301
Consumer [Member]
Loans [Line Items]
Carrying Value of Non - Accruing TDR's	$ 127	$ 142

XML

Loans - (Re-Measurement of Loans Accounted for Under ASC Topic 310-30 Resulting in Changes in Carrying Amount of Accretable Yield) (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Certain Loans Acquired in Transfer Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward]
Accretable yield beginning balance	$ 60,476	$ 84,194
Reclassification from non-accretable difference	7,732	5,646
Reclassification to non-accretable difference	(494)	(4,019)
Accretion	(12,051)	(18,056)
Accretable yield ending balance	$ 55,663	$ 67,765

XML

Loans - (Composition of Net Book Value for Loans Accounted for under ASC Topic 310-30) (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Receivables [Abstract]
Contractual cash flows	$ 514,149	$ 537,611
Non-accretable difference	(324,059)	(331,283)
Accretable yield	(55,663)	(60,476)
Loans accounted for under ASC 310-30	$ 134,427	$ 145,852

XML

Allowance for Loan Losses - (Summary of Company's Allowance for Loan Losses ("All") and Recorded Investment in Loans) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Dec. 31, 2016	Jun. 30, 2016
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	$ 30,850	$ 37,166	$ 29,174	$ 27,119
Provision (recoupment) for loan losses			5,820	17,076
Ending balance	34,959	40,106	34,959	40,106
Carrying amount of loan investments					$ 3,087,945	$ 2,860,921	$ 2,738,504
Loans	30,850	37,166	29,174	27,119	34,959	29,174	40,106
Total Loans					3,087,945	2,860,921	2,738,504
Receivables Acquired with Deteriorated Credit Quality [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Ending balance		169,282		169,282
Loans		169,282		169,282			169,282
Non ASC 310-30 [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	30,630	36,951	28,949	26,042
Charge-offs	(121)	(3,686)	(331)	(4,345)
Recoveries	205	210	296	297
Provision (recoupment) for loan losses	4,103	6,400	5,903	17,881
Ending balance	34,817	39,875	34,817	39,875
Ending allowance balance individually evaluated for impairment					39,379		14,977
Ending allowance balance collectively evaluated for impairment							2,523,506
Loans individually evaluated for impairment							231
Loans collectively evaluated for impairment							40,106
Carrying amount of loan investments					2,953,518	2,715,069
Loans	30,630	36,951	28,949	26,042	34,817	28,949	39,875
Total Loans					2,953,518	2,715,069
Non ASC 310-30 [Member] | Receivables Acquired with Deteriorated Credit Quality [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Ending allowance balance individually evaluated for impairment					6,244
Ending allowance balance collectively evaluated for impairment					28,573
Loans collectively evaluated for impairment					2,914,139
Carrying amount of loan investments					134,427
Total Loans					134,427
ASC 310-30 [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	220	215	225	1,077
Charge-offs		(41)		(41)
Provision (recoupment) for loan losses	(78)	57	(83)	(805)
Ending balance	142	231	142	231
Loans individually evaluated for impairment					142
Carrying amount of loan investments					134,427	145,852
Loans	220	215	225	1,077	142	225	231
Total Loans					134,427	145,852
ASC 310-30 [Member] | Receivables Acquired with Deteriorated Credit Quality [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Ending balance		24,898		24,898
Carrying amount of loan investments							45,716
Loans		24,898		24,898			24,898
Total Loans							45,716
Commercial Portfolio Segment [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	20,539	28,684	18,821	17,261
Ending balance	24,656	29,982	24,656	29,982
Carrying amount of loan investments					1,775,454		1,490,749
Loans	20,539	28,684	18,821	17,261	24,656	18,821	29,982
Total Loans					1,775,454		1,490,749
Commercial Portfolio Segment [Member] | Receivables Acquired with Deteriorated Credit Quality [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Ending balance		46,875		46,875
Loans		46,875		46,875			46,875
Commercial Portfolio Segment [Member] | Non ASC 310-30 [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	20,539	28,610	18,821	16,473
Charge-offs		(3,375)	(20)	(3,484)
Recoveries	30	12	41	24
Provision (recoupment) for loan losses	4,087	4,733	5,814	16,967
Ending balance	24,656	29,980	24,656	29,980
Ending allowance balance individually evaluated for impairment					30,458		14,933
Ending allowance balance collectively evaluated for impairment							1,406,609
Loans individually evaluated for impairment							2
Loans collectively evaluated for impairment							29,982
Loans	20,539	28,610	18,821	16,473	24,656	18,821	29,980
Commercial Portfolio Segment [Member] | Non ASC 310-30 [Member] | Receivables Acquired with Deteriorated Credit Quality [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Ending allowance balance individually evaluated for impairment					6,197
Ending allowance balance collectively evaluated for impairment					18,459
Loans collectively evaluated for impairment					1,709,018
Carrying amount of loan investments					35,978
Total Loans					35,978
Commercial Portfolio Segment [Member] | ASC 310-30 [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance		74		788
Provision (recoupment) for loan losses		(72)		(786)
Ending balance		2		2
Loans		74		788			2
Commercial Portfolio Segment [Member] | ASC 310-30 [Member] | Receivables Acquired with Deteriorated Credit Quality [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Ending balance		15,047		15,047
Carrying amount of loan investments							37,265
Loans		15,047		15,047			15,047
Total Loans							37,265
Residential Portfolio Segment [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	4,216	4,325	4,387	5,281
Ending balance	4,067	4,504	4,067	4,504
Carrying amount of loan investments					728,511		694,171
Loans	4,216	4,325	4,387	5,281	4,067	4,387	4,504
Total Loans					728,511		694,171
Residential Portfolio Segment [Member] | Receivables Acquired with Deteriorated Credit Quality [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Ending balance		19,341		19,341
Loans		19,341		19,341			19,341
Residential Portfolio Segment [Member] | Non ASC 310-30 [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	4,216	4,289	4,387	5,245
Charge-offs	(2)	(140)	(10)	(197)
Recoveries	110	16	113	23
Provision (recoupment) for loan losses	(257)	339	(423)	(567)
Ending balance	4,067	4,504	4,067	4,504
Ending allowance balance individually evaluated for impairment					8,205		39
Ending allowance balance collectively evaluated for impairment							667,461
Loans collectively evaluated for impairment							4,504
Loans	4,216	4,289	4,387	5,245	4,067	4,387	4,504
Residential Portfolio Segment [Member] | Non ASC 310-30 [Member] | Receivables Acquired with Deteriorated Credit Quality [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Ending allowance balance individually evaluated for impairment					45
Ending allowance balance collectively evaluated for impairment					4,022
Loans collectively evaluated for impairment					706,294
Carrying amount of loan investments					14,012
Total Loans					14,012
Residential Portfolio Segment [Member] | ASC 310-30 [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance		36		36
Provision (recoupment) for loan losses		(36)		(36)
Loans		36		36
Residential Portfolio Segment [Member] | ASC 310-30 [Member] | Receivables Acquired with Deteriorated Credit Quality [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Ending balance		4,465		4,465
Carrying amount of loan investments							7,369
Loans		4,465		4,465			4,465
Total Loans							7,369
Consumer Loan [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	280	296	324	411
Ending balance	302	252	302	252
Carrying amount of loan investments					26,960		27,845
Loans	280	296	324	411	302	324	252
Total Loans					26,960		27,845
Consumer Loan [Member] | Receivables Acquired with Deteriorated Credit Quality [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Ending balance		1,347		1,347
Loans		1,347		1,347			1,347
Consumer Loan [Member] | Non ASC 310-30 [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	276	249	319	385
Charge-offs	(119)	(171)	(301)	(388)
Recoveries	55	126	122	185
Provision (recoupment) for loan losses	82	30	154	52
Ending balance	294	234	294	234
Ending allowance balance individually evaluated for impairment					165		2
Ending allowance balance collectively evaluated for impairment							26,258
Loans individually evaluated for impairment							18
Loans collectively evaluated for impairment							252
Loans	276	249	319	385	294	319	234
Consumer Loan [Member] | Non ASC 310-30 [Member] | Receivables Acquired with Deteriorated Credit Quality [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Ending allowance balance individually evaluated for impairment					1
Ending allowance balance collectively evaluated for impairment					293
Loans collectively evaluated for impairment					26,143
Carrying amount of loan investments					652
Total Loans					652
Consumer Loan [Member] | ASC 310-30 [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	4	47	5	26
Provision (recoupment) for loan losses	4	(29)	3	(8)
Ending balance	8	18	8	18
Loans individually evaluated for impairment					8
Loans	4	47	5	26	8	5	18
Consumer Loan [Member] | ASC 310-30 [Member] | Receivables Acquired with Deteriorated Credit Quality [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Ending balance		232		232
Carrying amount of loan investments							240
Loans		232		232			232
Total Loans							240
Commercial Real Estate Portfolio Segment [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	5,815	3,861	5,642	4,166
Ending balance	5,934	5,368	5,934	5,368
Carrying amount of loan investments					557,020		525,739
Loans	5,815	3,861	5,642	4,166	5,934	5,642	5,368
Total Loans					557,020		525,739
Commercial Real Estate Portfolio Segment [Member] | Receivables Acquired with Deteriorated Credit Quality [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Ending balance		101,719		101,719
Loans		101,719		101,719			101,719
Commercial Real Estate Portfolio Segment [Member] | Non ASC 310-30 [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	5,599	3,803	5,422	3,939
Charge-offs				(276)
Recoveries	10	56	20	65
Provision (recoupment) for loan losses	191	1,298	358	1,429
Ending balance	5,800	5,157	5,800	5,157
Ending allowance balance individually evaluated for impairment					551		3
Ending allowance balance collectively evaluated for impairment							423,178
Loans individually evaluated for impairment							211
Loans collectively evaluated for impairment							5,368
Loans	5,599	3,803	5,422	3,939	5,800	5,422	5,157
Commercial Real Estate Portfolio Segment [Member] | Non ASC 310-30 [Member] | Receivables Acquired with Deteriorated Credit Quality [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Ending allowance balance individually evaluated for impairment					1
Ending allowance balance collectively evaluated for impairment					5,799
Loans collectively evaluated for impairment					472,684
Carrying amount of loan investments					83,785
Total Loans					83,785
Commercial Real Estate Portfolio Segment [Member] | ASC 310-30 [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Beginning balance	216	58	220	227
Charge-offs		(41)		(41)
Provision (recoupment) for loan losses	(82)	194	(86)	25
Ending balance	134	211	134	211
Loans individually evaluated for impairment					134
Loans	$ 216	58	$ 220	227	$ 134	$ 220	211
Commercial Real Estate Portfolio Segment [Member] | ASC 310-30 [Member] | Receivables Acquired with Deteriorated Credit Quality [Member]
Allowance for Loan and Lease Losses [Roll Forward]
Ending balance		5,154		5,154
Carrying amount of loan investments							842
Loans		$ 5,154		$ 5,154			5,154
Total Loans							$ 842

XML

Allowance for Loan Losses - (Narrative) (Details) - USD ($) $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 30, 2017	Mar. 31, 2017	Jun. 30, 2016	Mar. 31, 2016	Jun. 30, 2017	Jun. 30, 2016
Allowance For Loan And Lease Losses [Line Items]
Provision (recoupment) for loan losses					$ 5,820	$ 17,076
Impaired loans	$ 24,600				24,600
Energy Loans [Member]
Allowance For Loan And Lease Losses [Line Items]
Specific Reserve in Provision				$ 4,300		15,100
Commercial and Industrial [Member]
Allowance For Loan And Lease Losses [Line Items]
Specific Reserve in Provision		$ 2,100			3,400
Non ASC 310-30 [Member]
Allowance For Loan And Lease Losses [Line Items]
Charge-offs, net	100		$ 3,500		0	4,000
Provision (recoupment) for loan losses	4,103		6,400		5,903	17,881
ASC 310-30 [Member]
Allowance For Loan And Lease Losses [Line Items]
Provision (recoupment) for loan losses	$ (78)		$ 57		$ (83)	$ (805)

XML

Other Real Estate Owned - (Summary of Activity in OREO Balances) (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Other Real Estate [Roll Forward]
Balance	$ 15,662	$ 20,814
Transfers from loan portfolio, at fair value	639	3,654
Impairments	(46)	(104)
Proceeds From Sale Of Other Real Estate Owned, Net	(1,958)	(1,122)
Balance	$ 14,297	$ 23,242

XML

Other Real Estate Owned - (Narrative) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
FDIC Loss-Sharing Related
Minority interests in OREO which are held by outside banks					$ 1,600
Gain on sale of OREO, net	$ 1,644	$ 1,611	$ 1,756	$ 2,043

XML

Borrowings (Narrative) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Assets Sold under Agreements to Repurchase [Line Items]
Fair value of collateral	$ 4,200		$ 4,200		$ 7,000
Federal Home Loan Bank, Advances, Branch of FHLB Bank, Due Date, Earliest	2018		2018
Federal Home Loan Bank, Advances, Branch of FHLB Bank, Due Date, Last	2020		2020
Federal Home Loan Bank, Advances, General Debt Obligations, Maximum Amount Available	$ 763,600		$ 763,600
FHLB advances	129,100		129,100		25,000
Interest expense related to FHLB advances	$ 496	$ 166	$ 693	$ 332
Minimum
Assets Sold under Agreements to Repurchase [Line Items]
Interest rate range of FHLB advances	1.31%		1.31%
Maximum
Assets Sold under Agreements to Repurchase [Line Items]
Interest rate range of FHLB advances	2.33%		2.33%
U.S. Treasury Securities [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Fair value of collateral	$ 123,400		$ 123,400		$ 99,100

XML

Regulatory Capital - (Capital Ratio Requirements under Prompt Corrective Action or Other Regulatory Requirements) (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Parent Company [Member]
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items]
Leverage Ratio	10.30%	10.40%
Common equity risk-based ratio	13.30%	14.20%
Risk-based capital Ratio	13.30%	14.20%
Total risk-based capital Ratio	14.30%	15.00%
Leverage Amount	$ 472,627	$ 470,259
Common equity risk-based amount	472,627	470,259
Risk-based capital amount	472,627	470,259
Total risk-based capital Amount	$ 507,912	$ 499,759
Required to be considered adequately capitalized Ratio, leverage ratio	4.00%	4.00%
Required to be considered adequately capitalized Ratio, risk-based common equity capital ratio	4.50%	4.50%
Required to be considered adequately capitalized Ratio, risk-based capital ratio	6.00%	6.00%
Required to be considered adequately capitalized Ratio, Total risk-based capital ratio	8.00%	8.00%
Required to be considered adequately capitalized leverage Amount	$ 184,402	$ 181,019
Required to be considered adequately capitalized common equity capital amount	207,452	203,647
Required to be considered adequately capitalized risk-based capital Amount	213,366	199,467
Required to be considered adequately capitalized Total risk-based capital Amount	$ 284,488	$ 265,955
NBH Bank [Member]
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items]
Leverage Ratio	8.40%	8.60%
Common equity risk-based ratio	10.90%	11.80%
Risk-based capital Ratio	10.90%	11.80%
Total risk-based capital Ratio	11.90%	12.70%
Leverage Amount	$ 385,466	$ 389,189
Common equity risk-based amount	385,466	389,189
Risk-based capital amount	385,466	389,189
Total risk-based capital Amount	$ 420,750	$ 418,689
Required to be considered well capitalized Ratio, leverage ratio	4.50%	4.50%
Required to be considered adequately capitalized Ratio, risk-based common equity capital ratio	6.50%	6.50%
Required to be considered well capitalized Ratio, risk-based capital ratio	8.00%	8.00%
Required to be considered well capitalized Ratio, Total risk-based capital ratio	10.00%	10.00%
Required to be considered well capitalized leverage Amount	$ 206,721	$ 202,903
Required to be considered well capitalized common equity capital amount	298,597	293,082
Required to be considered well capitalized risk-based capital Amount	283,313	264,596
Required to be considered well capitalized Total risk-based capital Amount	$ 354,141	$ 330,745
Required to be considered adequately capitalized Ratio, leverage ratio	4.00%	4.00%
Required to be considered adequately capitalized Ratio, risk-based common equity capital ratio	4.50%	4.50%
Required to be considered adequately capitalized Ratio, risk-based capital ratio	6.00%	6.00%
Required to be considered adequately capitalized Ratio, Total risk-based capital ratio	8.00%	8.00%
Required to be considered adequately capitalized leverage Amount	$ 183,752	$ 180,358
Required to be considered adequately capitalized common equity capital amount	206,721	202,903
Required to be considered adequately capitalized risk-based capital Amount	212,485	198,447
Required to be considered adequately capitalized Total risk-based capital Amount	$ 283,313	$ 264,596

XML

Stock-based Compensation and Employee Benefits - (Narrative) (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Stock options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock based compensation expense	$ 200,000	$ 200,000		$ 400,000
Unrecognized compensation expense	800,000		$ 800,000
Unrecognized compensation cost, weighted-average period, years			2 years 4 months 24 days
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Awards granted (in shares)			65,990
Weighted average grant-date fair value, Granted (in dollars per share)			$ 33.43
Stock based compensation expense	800,000	$ 700,000	$ 1,400,000
Market-based stock awards | NBH Holdings Corp. 2014 Omnibus Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Awards granted (in shares)			26,594
Share-based Compensation Arrangement by Share-based Payment Award, Award Performance Period			5 years
Weighted average grant-date fair value, Granted (in dollars per share)			$ 11.28
Unrecognized compensation expense	300,000		$ 300,000
Unrecognized compensation cost, weighted-average period, years			1 year 10 months 24 days
Performance stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Awards granted (in shares)			49,758
Weighted average grant-date fair value, Granted (in dollars per share)			$ 33.22
Performance stock units | NBH Holdings Corp. 2014 Omnibus Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Awards granted (in shares)			49,758	91,342
Unrecognized compensation expense	$ 4,500,000		$ 4,500,000
Unrecognized compensation cost, weighted-average period, years			2 years 1 month 6 days
Performance stock units | NBH Holdings Corp. 2014 Omnibus Incentive Plan [Member] | EPS target
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of awards based on performance type			60.00%
Weighted average grant-date fair value, Granted (in dollars per share)			$ 34.04
Performance stock units | NBH Holdings Corp. 2014 Omnibus Incentive Plan [Member] | TSR target
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of awards based on performance type			40.00%
Weighted average grant-date fair value, Granted (in dollars per share)			$ 32.06
Employee Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares authorized	400,000		400,000
Maximum stock purchases by employees, value			$ 25,000
Maximum stock purchases by employees (in shares)			2,000
Discount on purchase of common stock (as a percent)			90.00%
Offering period for employee stock purchases			6 months
Employees purchased shares under the ESPP (in shares)			5,373
Shares available for issuance	360,963		360,963
Minimum | Stock options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period			1 year
Share Based Compensation Arrangement By Share Based Payment Award Options Granted Contractual Term			7 years
Minimum | Restricted Stock [Member] | NBH Holdings Corp. 2014 Omnibus Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period			1 year
Minimum | Performance stock units | NBH Holdings Corp. 2014 Omnibus Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of initial target awards			0.00%
Maximum | Stock options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period			4 years
Share Based Compensation Arrangement By Share Based Payment Award Options Granted Contractual Term			10 years
Maximum | Restricted Stock [Member] | NBH Holdings Corp. 2014 Omnibus Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period			3 years
Maximum | Performance stock units | NBH Holdings Corp. 2014 Omnibus Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of initial target awards			150.00%

XML

Stock-based Compensation and Benefits - (Summary of Option Activity) (Details) - USD ($) $ / shares in Units, $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Outstanding Options, beginning	2,185,922
Granted, Options	99,920
Forfeited, Options	(16,225)
Exercised, Options	(585,750)
Outstanding Options, ending	1,683,867	2,185,922
Options fully vested and exercisable at end of period, Options	1,429,584
Options expected to vest, Options	1,662,690
Outstanding, Weighted average exercise price, beginning	$ 19.81
Granted, Weighted average exercise price	33.98
Forfeited, Weighted average exercise price	21.84
Exercised, Weighted average exercise price	19.93
Outstanding, Weighted average exercised price, ending	20.61	$ 19.81
Options fully vested and exercisable at end of period, Weighted average exercise price	19.80
Options expected to vest, Weighted average exercise price	$ 20.53
Outstanding, Weighted average remaining contractual term in years	4 years 6 months 7 days	4 years 10 months 6 days
Options fully vested and exercisable at end of period, weighted average remaining contractual term in years	3 years 9 months 7 days
Options expected to vest, Weighted average remaining contractual term in years	4 years 5 months 16 days
Outstanding, Aggregate intrinsic value, beginning	$ 7,753
Outstanding, Outstanding, Aggregate intrinsic value, beginning	21,136	$ 7,753
Aggregate intrinsic Value of Options fully vested and exercisable at end of period	19,021
Options expected to vest, Aggregate Intrinsic Value	$ 20,994

XML

Stock-based Compensation and Benefits - (Summary of Restricted Stock Activity) (Details)	6 Months Ended
	Jun. 30, 2017 $ / shares shares
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Unvested Restricted shares, Beginning (in shares) | shares	499,271
Unvested Restricted shares, Vested (in shares) | shares	(298,086)
Unvested Restricted shares, Granted (in shares) | shares	65,990
Unvested Restricted shares, Forfeited (in shares) | shares	(11,111)
Unvested Restricted shares, Ending (in shares) | shares	256,064
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]
Weighted average grant-date fair value, Beginning (in dollars per share) | $ / shares	$ 15.82
Weighted average grant-date fair value, Vested (in dollars per share) | $ / shares	15.27
Weighted average grant-date fair value, Granted (in dollars per share) | $ / shares	33.43
Weighted average grant-date fair value, Forfeited (in dollars per share) | $ / shares	22.23
Weighted average grant-date fair value, Ending (in dollars per share) | $ / shares	$ 20.82
Performance stock units
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Unvested Restricted shares, Beginning (in shares) | shares	85,295
Unvested Restricted shares, Granted (in shares) | shares	49,758
Unvested Restricted shares, Forfeited (in shares) | shares	(5,994)
Unvested Restricted shares, Ending (in shares) | shares	129,059
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]
Weighted average grant-date fair value, Beginning (in dollars per share) | $ / shares	$ 18.22
Weighted average grant-date fair value, Granted (in dollars per share) | $ / shares	33.22
Weighted average grant-date fair value, Forfeited (in dollars per share) | $ / shares	20.90
Weighted average grant-date fair value, Ending (in dollars per share) | $ / shares	$ 23.88

XML

Warrants (Narrative) (Details) - $ / shares	3 Months Ended
	Mar. 31, 2017	Jun. 30, 2017	Dec. 31, 2016	Jun. 30, 2016	Mar. 31, 2016
Warrants and Rights Note Disclosure [Abstract]
Warrants granted, exercise price per share		$ 20.00	$ 20.00	$ 20.00	$ 20.00
Warrants settled or exercised	250,750

XML

Common Stock - (Narrative) (Details) - USD ($) $ in Thousands	6 Months Ended		12 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016	Aug. 05, 2016
Schedule Of Common Stock [Line Items]
Shares repurchased (shares)		1,671,923
Repurchase of shares		$ 32,918
Remaining authorized amount	$ 12,600
Shares outstanding	26,788,833		26,386,583
Common Class A [Member]
Schedule Of Common Stock [Line Items]
Shares outstanding	26,788,833		26,386,583
Restricted issued but not yet vested, shares	256,064		499,271
New Board Authorized Share Repurchase Program
Schedule Of Common Stock [Line Items]
Stock repurchase program, authorized amount				$ 50,000

XML

Income Per Share - (Narrative) (Details) - $ / shares	3 Months Ended	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016	Mar. 31, 2016
Shares outstanding	28,810,883	26,788,833	28,810,883
Outstanding stock options to purchase common stock	2,703,752	1,683,867	2,703,752	2,185,922
Outstanding stock options to purchase common stock, per share	$ 19.82	$ 20.61	$ 19.82	$ 19.81
Warrants granted, exercise price per share	$ 20.00	$ 20.00	$ 20.00	$ 20.00	$ 20.00
Restricted shares outstanding		256,064	918,890
Warrant [Member]
Dilutive Convertible Securities	13,476	16,627	3,166

XML

Income Per Share - (Schedule of Computation of Basic and Diluted Income Per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Net income	$ 9,209	$ 4,504	$ 17,467	$ 4,755
Undistributed Earnings (Loss) Allocated to Participating Securities, Basic	(14)	(12)	(30)	(25)
Income available to common stockholders (numerator)	$ 9,195	$ 4,492	$ 17,437	$ 4,730
Weighted average common shares outstanding (denominator)	26,955,187	29,215,822	26,878,904	29,666,570
Weighted average shares outstanding for diluted earnings per common share	27,597,443	29,278,759	27,637,532	29,707,379
Income per share-basic (in dollars per share)	$ 0.34	$ 0.15	$ 0.65	$ 0.16
Income per share-diluted (in dollars per share)	$ 0.33	$ 0.15	$ 0.63	$ 0.16
Equity Option [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Dilutive Convertible Securities	642,256	49,461	742,001	37,643
Warrant [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Dilutive Convertible Securities		13,476	16,627	3,166

XML

Income Taxes (Details) - USD ($) $ in Millions	3 Months Ended			6 Months Ended
	Jun. 30, 2017	Mar. 31, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Income Tax Disclosure [Abstract]
Income tax rate	19.10%		17.90%	5.10%	19.80%
Employee Service Share-based Compensation, Tax Benefit Realized from Exercise of Stock Options		$ 0.5		$ 3.4

XML

Derivatives - (FV of Derivatives on the Balance Sheet) (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Designated as Hedging Instrument [Member]
Derivative [Line Items]
Asset derivatives fair value	$ 8,310	$ 9,528
Liability derivatives fair value	2,268	1,381
Not Designated as Hedging Instrument [Member]
Derivative [Line Items]
Asset derivatives fair value	2,541	2,187
Liability derivatives fair value	2,487	2,085
Other assets [Member] | Interest rate products [Member] | Designated as Hedging Instrument [Member]
Derivative [Line Items]
Asset derivatives fair value	8,310	9,528
Liability derivatives fair value	2,268	1,381
Other assets [Member] | Interest rate products [Member] | Not Designated as Hedging Instrument [Member]
Derivative [Line Items]
Asset derivatives fair value	2,384	1,900
Liability derivatives fair value	2,461	1,898
Other assets [Member] | Interest Rate Lock Commitments [Member] | Not Designated as Hedging Instrument [Member]
Derivative [Line Items]
Asset derivatives fair value	143	149
Liability derivatives fair value		6
Other assets [Member] | Forward Contracts [Member] | Designated as Hedging Instrument [Member]
Derivative [Line Items]
Asset derivatives fair value	14	138
Liability derivatives fair value	$ 26	$ 20

XML

Derivatives - (Narrative) (Details) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2017 USD ($) item	Jun. 30, 2016 USD ($)	Jun. 30, 2017 USD ($) item	Jun. 30, 2016 USD ($)	Dec. 31, 2016 USD ($) item
Derivative [Line Items]
Number of interest rate lock commitments | item					78
Number of forward contracts | item			9
Notional amount	$ 10,000		$ 10,000
Gain (loss) related to hedge ineffectiveness	207	$ (462)	385	$ (1,100)
Termination value of derivatives in net liability position	1,100		1,100		$ 1,300
Collateral Already Posted, Aggregate Fair Value	2,800		$ 2,800		800
Interest Rate Lock Commitments [Member]
Derivative [Line Items]
Notional amount					13,800
Number OF Interest Rate Loack Commitments Member
Derivative [Line Items]
Number of interest rate lock commitments | item			59
Interest Rate Lock Commitments Notional Amount Member
Derivative [Line Items]
Notional amount	$ 12,400		$ 12,400
Forward Contract Notional [Member]
Derivative [Line Items]
Notional amount					$ 11,800
Designated as Hedging Instrument [Member] | Interest rate swap derivatives [Member]
Derivative [Line Items]
Number of interest rate swaps held | item	52		52		42
Notional amount	$ 372,100		$ 372,100		$ 313,000
Not Designated as Hedging Instrument [Member] | Interest rate swap derivatives [Member]
Derivative [Line Items]
Number of interest rate swaps held | item	39		39		36
Notional amount	$ 161,300		$ 161,300		$ 132,600

XML

Derivatives - (Derivatives on the Income Statement) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Not Designated as Hedging Instrument [Member]
Derivative [Line Items]
Amount of gain or (loss) recognized in income on derivatives	$ (106)	$ 65	$ (209)	$ (29)
Fair Value Hedging [Member] | Designated as Hedging Instrument [Member]
Derivative [Line Items]
Amount of gain or (loss) recognized in income on derivatives	(3,169)	(6,513)	(2,105)	(17,414)
Interest rate products [Member] | Designated as Hedging Instrument [Member]
Derivative [Line Items]
Amount of gain or (loss) recognized in income on hedged items	2,962	6,051	1,720	16,281
Interest rate products [Member] | Designated as Hedging Instrument [Member] | Other Non-Interest income [Member]
Derivative [Line Items]
Amount of gain or (loss) recognized in income on hedged items	2,962	6,051	1,720	16,281
Interest rate products [Member] | Not Designated as Hedging Instrument [Member] | Other Non-Interest income [Member]
Derivative [Line Items]
Amount of gain or (loss) recognized in income on derivatives	(47)	(89)	(79)	(183)
Interest rate products [Member] | Fair Value Hedging [Member] | Designated as Hedging Instrument [Member] | Other Non-Interest income [Member]
Derivative [Line Items]
Amount of gain or (loss) recognized in income on derivatives	(3,169)	(6,513)	(2,105)	(17,414)
Forward Contracts [Member] | Not Designated as Hedging Instrument [Member] | Other Non-Interest income [Member]
Derivative [Line Items]
Amount of gain or (loss) recognized in income on derivatives	63	(178)	(131)	(178)
Interest Rate Lock Commitments [Member] | Not Designated as Hedging Instrument [Member] | Other Non-Interest income [Member]
Derivative [Line Items]
Amount of gain or (loss) recognized in income on derivatives	$ (122)	$ 332	$ 1	$ 332

XML

Commitments and Contingencies (Narrative) (Details) - USD ($) $ in Millions	Jun. 30, 2017	Dec. 31, 2016
Commitment And Contingencies [Line Items]
Loan commitments	$ 648.2	$ 602.2
Standby Letters of Credit [Member]
Commitment And Contingencies [Line Items]
Standby letters of credit	$ 15.0	$ 13.5

XML

Commitments and Contingencies (Schedule of Total Unfunded Commitments) (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Commitment And Contingencies [Line Items]
Total unfunded commitments	$ 663,262	$ 615,774
Commitments to fund loans [Member]
Commitment And Contingencies [Line Items]
Total unfunded commitments	181,052	149,391
Unfunded Commitment Line Of Credit [Member]
Commitment And Contingencies [Line Items]
Total unfunded commitments	467,180	452,851
Commercial And Standby Letters Of Credit [Member]
Commitment And Contingencies [Line Items]
Total unfunded commitments	$ 15,030	$ 13,532

XML

Fair Value Measurements - (Tables of Financial Instruments Measured At Fair Value on Recurring Basis) (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	$ 876,881	$ 895,262
Total liabilities at fair value	4,755	3,305
Municipal [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	2,058	3,648
Mortgage-Backed Securities (MBS) [Member] | Residential Mortgage Pass-Through Securities Issued or Guaranteed by U.S. Government Agencies or Sponsored Enterprises [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	195,341	227,160
Mortgage-Backed Securities (MBS) [Member] | Other Residential MBS Issued or Guaranteed by U.S. Government Agencies or Sponsored Enterprises [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	668,631	652,739
Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	876,724	894,975
Total liabilities at fair value	4,729	3,279
Level 2 [Member] | Municipal [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	2,058	3,648
Level 2 [Member] | Mortgage-Backed Securities (MBS) [Member] | Residential Mortgage Pass-Through Securities Issued or Guaranteed by U.S. Government Agencies or Sponsored Enterprises [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	195,341	227,160
Level 2 [Member] | Mortgage-Backed Securities (MBS) [Member] | Other Residential MBS Issued or Guaranteed by U.S. Government Agencies or Sponsored Enterprises [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	668,631	652,739
Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	157	287
Total liabilities at fair value	26	26
Interest rate swap derivatives [Member] | Derivative [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	10,694	11,428
Total liabilities at fair value	4,729	3,279
Interest rate swap derivatives [Member] | Level 2 [Member] | Derivative [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	10,694	11,428
Total liabilities at fair value	4,729	$ 3,279
Mortgage banking derivatives | Derivative [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	157
Total liabilities at fair value	26
Mortgage banking derivatives | Level 3 [Member] | Derivative [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	157
Total liabilities at fair value	$ 26

XML

Fair Value Measurements - (Table of Changes in Level 3 Financial Instruments) (Details) - Derivative Financial Instruments Assets and Liabilities [Member] $ in Thousands	6 Months Ended
	Jun. 30, 2017 USD ($)
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning Balance	$ 261
Realized gain (loss) included in earnings—net mortgage banking derivatives	(130)
Ending Balance	$ 131

XML

Fair Value Measurements - Additional Information (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2017 USD ($) loan	Jun. 30, 2016 USD ($)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Number of Loans measured | loan	7
Nonrecurring Loans Carrying value	$ 14,500
Nonrecurring Loans Reserves	6,200	$ 14,900
Impairment on other real estate owned	$ 46	$ 104
Additions [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Number of Loans measured | loan	6

XML

Fair Value Measurements - (Inputs Used to Determine Fair Values of Oreo are Considered Level 3 Inputs in Fair Value Hierarchy) (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Other Real Estate Owned [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of assets on a non-recurring basis	$ 14,297	$ 23,242
Losses From Fair Value Changes	(46)	104
Impaired loans [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of assets on a non-recurring basis	39,379	46,815
Losses From Fair Value Changes	$ (327)	$ 4,019

XML

Fair Value Measurements - (Table of Valuation Techniques and Unobservable Inputs Used in Valuation of Financial Instruments Falling Within Level 3 of Fair Value Hierarchy) (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Total assets at fair value	$ 876,881	$ 895,262
Impaired loans [Member]
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Total assets at fair value	$ 39,379
Minimum | Appraised value [Member] | Impaired loans [Member]
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Appraised values Discount rate	0.00%
Maximum | Appraised value [Member] | Impaired loans [Member]
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Appraised values Discount rate	25.00%

XML

Fair Value of Financial Instruments - (Schedule of Fair Value of Financial Instruments) (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016	Jun. 30, 2016	Dec. 31, 2015
ASSETS:
Cash and cash equivalents	$ 129,827	$ 152,736	$ 147,939	$ 166,092
Investment securities available-for-sale (at fair value)	866,714	884,232
Mortgage-backed securities-residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises held-to-maturity	294,891	332,505
Non-marketable securities	18,468	14,949
Loans held-for-sale	7,067	24,187
LIABILITIES:
Time deposits	1,126,481	1,172,046
Securities sold under agreements to repurchase	119,213	92,011
Federal Home Loan Bank advances	129,115	38,665
Residential Mortgage Pass-Through Securities Issued or Guaranteed by U.S. Government Agencies or Sponsored Enterprises [Member]
ASSETS:
Investment securities available-for-sale (at fair value)	195,341	227,160
Mortgage-backed securities-residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises held-to-maturity	233,026	263,411
Other Residential MBS Issued or Guaranteed by U.S. Government Agencies or Sponsored Enterprises [Member]
ASSETS:
Investment securities available-for-sale (at fair value)	668,631	652,739
Mortgage-backed securities-residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises held-to-maturity	61,865	69,094
Other Securities [Member]
ASSETS:
Investment securities available-for-sale (at fair value)	419	419
Municipal [Member]
ASSETS:
Investment securities available-for-sale (at fair value)	2,323	3,914
Carrying Amount [Member] | Level 1 [Member]
ASSETS:
Cash and cash equivalents	129,827	152,736
Carrying Amount [Member] | Level 2 [Member]
ASSETS:
Non-marketable securities	18,468	14,949
Loans held-for-sale	7,067	24,187
Accrued interest receivable	13,294	12,562
LIABILITIES:
Deposit transaction accounts	2,730,976	2,696,603
Time deposits	1,126,481	1,172,046
Securities sold under agreements to repurchase	119,213	92,011
Federal Home Loan Bank advances	129,115	38,665
Accrued interest payable	5,098	4,973
Carrying Amount [Member] | Level 3 [Member]
ASSETS:
Loans receivable, net	3,087,945	2,860,921
Carrying Amount [Member] | Residential Mortgage Pass-Through Securities Issued or Guaranteed by U.S. Government Agencies or Sponsored Enterprises [Member] | Level 2 [Member]
ASSETS:
Investment securities available-for-sale (at fair value)	195,341	227,160
Mortgage-backed securities-residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises held-to-maturity	233,026	263,411
Carrying Amount [Member] | Other Residential MBS Issued or Guaranteed by U.S. Government Agencies or Sponsored Enterprises [Member] | Level 2 [Member]
ASSETS:
Investment securities available-for-sale (at fair value)	668,631	652,739
Mortgage-backed securities-residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises held-to-maturity	61,865	69,094
Carrying Amount [Member] | Other Securities [Member] | Level 3 [Member]
ASSETS:
Investment securities available-for-sale (at fair value)	419	419
Carrying Amount [Member] | Municipal [Member] | Level 2 [Member]
ASSETS:
Municipal obligations	2,058	3,648
Carrying Amount [Member] | Municipal [Member] | Level 3 [Member]
ASSETS:
Municipal obligations	265	265
Estimated Fair Value [Member] | Level 1 [Member]
ASSETS:
Cash and cash equivalents	129,827	152,736
Estimated Fair Value [Member] | Level 2 [Member]
ASSETS:
Non-marketable securities	18,468	14,949
Loans held-for-sale	7,067	24,187
Accrued interest receivable	13,294	12,562
LIABILITIES:
Deposit transaction accounts	2,730,976	2,696,603
Time deposits	1,126,481	1,172,046
Securities sold under agreements to repurchase	119,213	92,011
Federal Home Loan Bank advances	130,642	39,324
Accrued interest payable	5,098	4,973
Estimated Fair Value [Member] | Level 3 [Member]
ASSETS:
Loans receivable, net	3,096,298	2,879,860
Estimated Fair Value [Member] | Residential Mortgage Pass-Through Securities Issued or Guaranteed by U.S. Government Agencies or Sponsored Enterprises [Member] | Level 2 [Member]
ASSETS:
Investment securities available-for-sale (at fair value)	195,341	227,160
Mortgage-backed securities-residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises held-to-maturity	234,194	264,862
Estimated Fair Value [Member] | Other Residential MBS Issued or Guaranteed by U.S. Government Agencies or Sponsored Enterprises [Member] | Level 2 [Member]
ASSETS:
Investment securities available-for-sale (at fair value)	668,631	652,739
Mortgage-backed securities-residential mortgage pass-through securities issued or guaranteed by U.S. Government agencies or sponsored enterprises held-to-maturity	60,675	67,711
Estimated Fair Value [Member] | Other Securities [Member] | Level 3 [Member]
ASSETS:
Investment securities available-for-sale (at fair value)	419	419
Estimated Fair Value [Member] | Municipal [Member] | Level 2 [Member]
ASSETS:
Municipal obligations	2,058	3,648
Estimated Fair Value [Member] | Municipal [Member] | Level 3 [Member]
ASSETS:
Municipal obligations	265	265
Interest rate swap derivatives [Member] | Carrying Amount [Member] | Level 2 [Member]
ASSETS:
Derivative asset	10,694	11,428
LIABILITIES:
Derivative liability	4,729	3,279
Interest rate swap derivatives [Member] | Estimated Fair Value [Member] | Level 2 [Member]
ASSETS:
Derivative asset	10,694	11,428
LIABILITIES:
Derivative liability	4,729	3,279
Mortgage banking derivatives | Carrying Amount [Member] | Level 3 [Member]
ASSETS:
Derivative asset	157	287
LIABILITIES:
Derivative liability	26	187
Mortgage banking derivatives | Estimated Fair Value [Member] | Level 3 [Member]
ASSETS:
Derivative asset	157	287
LIABILITIES:
Derivative liability	$ 26	$ 187

XML

Fair Value of Financial Instruments - (Additional Information) (Details)	6 Months Ended
	Jun. 30, 2017
Fair Value Of Financial Instruments [Abstract]
Residential mortgage loans held for sale period	45 days