QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the quarterly period ended | |||||
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the transition period from to |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | ||||
(Address of Principal Executive Offices) | (Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
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. | ||
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). | ||
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one): |
Large accelerated filer | o | Accelerated filer | o | |||||||||||
x | 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 Act). Yes o No | ||
The registrant had outstanding |
Page | ||||||||
Item 1A. | ||||||||
Item 4. | ||||||||
ACL: Allowance for Credit Losses | FDIA: Federal Deposit Insurance Act | ||||
AFS: Available for Sale | FDIC: Federal Deposit Insurance Corporation | ||||
AIO: Architecture, Infrastructure, and Operations | FFIEC: Federal Financial Institutions Examination Council | ||||
ALCO: Asset-Liability Committee | FHLB: Federal Home Loan Bank | ||||
ALLL: Allowance for Loan Losses | FNBB: First National Bankers Bank | ||||
AOCI: Accumulated Other Comprehensive Income | FRB: Federal Reserve Bank | ||||
ASC: FASB Accounting Standards Codification | FVO: Fair Value Option | ||||
ASU: FASB Accounting Standards Update | GAAP: Generally Accepted Accounting Principles | ||||
BHCA: Bank Holding Company Act of 1956, as amended | HFI: Held for Investment | ||||
BOLI: Bank Owned Life Insurance | HTM: Held to Maturity | ||||
BSA: Bank Secrecy Act of 1970 | IRA: Individual Retirement Account | ||||
CAA: Consolidated Appropriations Act | JOBS Act: Jumpstart Our Business Startups Act of 2012 | ||||
CARES Act: Coronavirus Aid, Relief, and Economic Security Act | LGD: Loss Given Default | ||||
CBLR: Community Bank Leverage Ratio | LHFS: Loans Held for Sale | ||||
CDARS: Certificate of Deposit Account Registry Services | MMDA: Money Market Deposit Account | ||||
CECL: Current Expected Credit Losses | NOW: Negotiable Order of Withdrawal | ||||
CEO: Chief Executive Officer | NSPP: Non-Qualified Stock Purchase Plan | ||||
CET1: Common Equity Tier 1 Capital | OCC: Office of the Comptroller of the Currency | ||||
CFPB: Consumer Financial Protection Bureau | OLC: Officer Loan Committee | ||||
C&I: Commercial and Industrial | OREO: Other Real Estate Owned | ||||
CIK: Central Index Key | OTTI: Other-Than-Temporary Impairment | ||||
COVID-19: Coronavirus Disease 2019 | PCAOB: Public Company Accounting Oversight Board | ||||
DCLC: Directors’ Credit and Loan Committee | PD: Probability of Default | ||||
DEI: Diversity, Equity, and Inclusion | PPP: Paycheck Protection Program | ||||
Dodd-Frank Act: Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 | PPPLF: Paycheck Protection Program Liquidity Facility | ||||
DRIP: Dividend Reinvestment Plan | QIB: Qualified Institutional Buyer | ||||
EGC: Emerging Growth Company | ROU: Right of Use | ||||
EPS: Earnings per Share | SBA: Small Business Administration | ||||
Equity Plan: The Amended and Restated 2017 Equity Incentive Plan | SEC: U.S. Securities and Exchange Commission | ||||
ESG: Environmental, Social, and Governance | SOFR: Secured Overnight Financing Rate | ||||
ESOP: Employee Stock Ownership Plan | U.S.: United States | ||||
ESPP: Employee Stock Purchase Plan | USDA: United States Department of Agriculture | ||||
Exchange Act: Securities Exchange Act of 1934 | USDA B&I: United States Department of Agriculture Business and Industry | ||||
FASB: Financial Accounting Standards Board | WARM: Weighted Average Remaining Life | ||||
FBCA: Florida Business Corporation Act |
September 30, 2023 | December 31, 2022 | ||||||||||
(Unaudited) | |||||||||||
ASSETS | |||||||||||
Cash and due from banks | $ | $ | |||||||||
Interest-bearing deposits in banks | |||||||||||
Cash and cash equivalents | |||||||||||
Time deposits in banks | |||||||||||
Investment securities available for sale, at fair value (amortized cost: $ | |||||||||||
Investment securities held to maturity, at amortized cost, net of allowance for credit losses of $ | |||||||||||
Nonmarketable equity securities | |||||||||||
Government guaranteed loans held for sale | |||||||||||
Government guaranteed loans held for investment, at fair value | |||||||||||
Loans held for investment, at amortized cost, net of allowance for credit losses of $ | |||||||||||
Accrued interest receivable | |||||||||||
Premises and equipment, net | |||||||||||
Loan servicing rights | |||||||||||
Deferred income tax asset | |||||||||||
Right-of-use operating lease assets | |||||||||||
Bank owned life insurance | |||||||||||
Other assets | |||||||||||
Assets from discontinued operations | |||||||||||
Total assets | $ | $ | |||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||
Liabilities: | |||||||||||
Noninterest-bearing deposits | $ | $ | |||||||||
Interest-bearing transaction accounts | |||||||||||
Savings and money market deposits | |||||||||||
Time deposits | |||||||||||
Total deposits | |||||||||||
FRB and FHLB borrowings | |||||||||||
Subordinated debentures | |||||||||||
Notes payable | |||||||||||
Accrued interest payable | |||||||||||
Operating lease liabilities | |||||||||||
Accrued expenses and other liabilities | |||||||||||
Liabilities from discontinued operations | |||||||||||
Total liabilities |
September 30, 2023 | December 31, 2022 | ||||||||||
(Unaudited) | |||||||||||
Shareholders’ equity: | |||||||||||
Preferred stock, Series A; no par value, | |||||||||||
Preferred stock, Series B; no par value, | |||||||||||
Preferred stock, Series C; no par value, | |||||||||||
Common stock and additional paid-in capital; no par value, | |||||||||||
Accumulated other comprehensive loss, net | ( | ( | |||||||||
Unearned compensation | ( | ( | |||||||||
Retained earnings | |||||||||||
Total shareholders’ equity | |||||||||||
Total liabilities and shareholders’ equity | $ | $ |
BAYFIRST FINANCIAL CORP. CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) (Dollars in thousands, except per share data) |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Interest income: | |||||||||||||||||||||||
Loans, including fees | $ | $ | $ | $ | |||||||||||||||||||
Interest-bearing deposits in banks and other | |||||||||||||||||||||||
Total interest income | |||||||||||||||||||||||
Interest expense: | |||||||||||||||||||||||
Deposits | |||||||||||||||||||||||
Borrowings | |||||||||||||||||||||||
Total interest expense | |||||||||||||||||||||||
Net interest income | |||||||||||||||||||||||
Provision for credit losses | ( | ||||||||||||||||||||||
Net interest income after provision for credit losses | |||||||||||||||||||||||
Noninterest income: | |||||||||||||||||||||||
Loan servicing income, net | |||||||||||||||||||||||
Gain on sale of government guaranteed loans, net | |||||||||||||||||||||||
Service charges and fees | |||||||||||||||||||||||
Government guaranteed loans fair value gain | |||||||||||||||||||||||
Other noninterest income | |||||||||||||||||||||||
Total noninterest income | |||||||||||||||||||||||
Noninterest expense: | |||||||||||||||||||||||
Salaries and benefits | |||||||||||||||||||||||
Bonus, commissions, and incentives | |||||||||||||||||||||||
Occupancy and equipment | |||||||||||||||||||||||
Data processing | |||||||||||||||||||||||
Marketing and business development | |||||||||||||||||||||||
Professional services | |||||||||||||||||||||||
Loan origination and collection | |||||||||||||||||||||||
Employee recruiting and development | |||||||||||||||||||||||
Regulatory assessments | |||||||||||||||||||||||
Other noninterest expense | |||||||||||||||||||||||
Total noninterest expense | |||||||||||||||||||||||
Income from continuing operations before income taxes | |||||||||||||||||||||||
Income tax expense from continuing operations | |||||||||||||||||||||||
Net income from continuing operations | |||||||||||||||||||||||
Loss from discontinued operations before income taxes | ( | ( | ( | ( | |||||||||||||||||||
Income tax benefit from discontinued operations | ( | ( | ( | ( | |||||||||||||||||||
Net loss from discontinued operations | ( | ( | ( | ( | |||||||||||||||||||
Net income (loss) | ( | ( | |||||||||||||||||||||
Preferred stock dividends | |||||||||||||||||||||||
Net income available to (loss attributable to) common shareholders | $ | $ | ( | $ | $ | ( | |||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Basic earnings (loss) per common share: | |||||||||||||||||||||||
Continuing operations | $ | $ | $ | $ | |||||||||||||||||||
Discontinued operations | ( | ( | ( | ( | |||||||||||||||||||
Total basic earnings (loss) per common share | $ | $ | ( | $ | $ | ( | |||||||||||||||||
Diluted earnings (loss) per common share: | |||||||||||||||||||||||
Continuing operations | $ | $ | $ | $ | |||||||||||||||||||
Discontinued operations | ( | ( | ( | ( | |||||||||||||||||||
Total diluted earnings (loss) per common share | $ | $ | ( | $ | $ | ( |
BAYFIRST FINANCIAL CORP. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED) (Dollars in thousands) |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Net income (loss) | $ | $ | ( | $ | $ | ( | |||||||||||||||||
Net unrealized gains (losses) on investment securities available for sale | ( | ( | ( | ||||||||||||||||||||
Deferred income tax (expense) benefit | ( | ||||||||||||||||||||||
Other comprehensive income (loss), net | ( | ( | ( | ||||||||||||||||||||
Comprehensive income (loss) | $ | $ | ( | $ | $ | ( |
BAYFIRST FINANCIAL CORP. CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (UNAUDITED) (Dollars in thousands, except per share data) |
Preferred Stock, Series A | Preferred Stock, Series B | Preferred Stock, Series C | Common Stock and Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Total | |||||||||||||||||||||||||||||||||||
Balance at July 1, 2022 | $ | $ | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||
Issuance of common stock under: | |||||||||||||||||||||||||||||||||||||||||
Non-qualified stock purchase plan | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Dividend reinvestment plan | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Exercise of stock options, net | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Stock-based awards - common stock: | |||||||||||||||||||||||||||||||||||||||||
Restricted stock expense, net of tax impact | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Stock option expense | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Other comprehensive loss, net | — | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
Dividends declared on: | |||||||||||||||||||||||||||||||||||||||||
Preferred stock | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||
Common stock ($ | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||
Balance at September 30, 2022 | $ | $ | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||
Balance at July 1, 2023 | $ | $ | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Issuance of common stock under: | |||||||||||||||||||||||||||||||||||||||||
Non-qualified stock purchase plan | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Dividend reinvestment plan | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Repurchase of common stock | — | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||
Exercise of stock options, net | — | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||
Issuance of preferred stock, net | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Stock-based awards - common stock: | |||||||||||||||||||||||||||||||||||||||||
Restricted stock expense, net of tax impact | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Stock option expense | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Other comprehensive loss, net | — | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
Dividends declared on: | — | ||||||||||||||||||||||||||||||||||||||||
Preferred stock | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||
Common stock ($ | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||
Balance at September 30, 2023 | $ | $ | $ | $ | $ | ( | $ | $ |
BAYFIRST FINANCIAL CORP. CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (UNAUDITED) (Dollars in thousands, except per share data) |
Preferred Stock, Series A | Preferred Stock, Series B | Preferred Stock, Series C | Common Stock and Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Total | |||||||||||||||||||||||||||||||||||
Balance at January 1, 2022 | $ | $ | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||
Issuance of common stock under: | |||||||||||||||||||||||||||||||||||||||||
Non-qualified stock purchase plan | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Dividend reinvestment plan | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Repurchase of common stock | — | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||
Exercise of stock options,net | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Issuance of common stock, net | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Stock-based awards - common stock: | |||||||||||||||||||||||||||||||||||||||||
Restricted stock expense, net of tax impact | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Stock option expense | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Other comprehensive loss, net | — | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
Dividends declared on: | — | ||||||||||||||||||||||||||||||||||||||||
Preferred stock | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||
Common stock ($ | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||
Balance at September 30, 2022 | $ | $ | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||
Balance at January 1, 2023 | $ | $ | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
— | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||
Issuance of common stock under: | |||||||||||||||||||||||||||||||||||||||||
Non-qualified stock purchase plan | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Dividend reinvestment plan | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Issuance of preferred stock, net | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Repurchase of common stock | — | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||
Exercise of stock options, net | — | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||
Unearned ESOP shares allocation | — | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||
Stock-based awards - common stock: | |||||||||||||||||||||||||||||||||||||||||
Restricted stock expense, net of tax impact | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Stock option expense | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Other comprehensive income, net | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Dividends declared on: | |||||||||||||||||||||||||||||||||||||||||
Preferred stock | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||
Common stock ($ | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||
Balance at September 30, 2023 | $ | $ | $ | $ | $ | ( | $ | $ |
BAYFIRST FINANCIAL CORP. CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) CONTINUED (Dollars in thousands) |
Nine Months Ended September 30, | |||||||||||
2023 | 2022 | ||||||||||
Cash flows from operating activities: | |||||||||||
Net income from continuing operations | $ | $ | |||||||||
Net loss from discontinued operations | ( | ( | |||||||||
Net income (loss) | ( | ||||||||||
Adjustments to reconcile net income (loss) to net cash from operating activities: | |||||||||||
Depreciation of fixed assets | |||||||||||
Net securities premium amortization | |||||||||||
Amortization of debt issuance costs | |||||||||||
Amortization of premium on loans purchased, net | |||||||||||
Provision for credit losses | ( | ||||||||||
Accretion of discount on unguaranteed loans | ( | ( | |||||||||
Deferred tax expense (benefit) | ( | ||||||||||
Origination of government guaranteed loans held for sale | ( | ( | |||||||||
Proceeds from sales of government guaranteed loans held for sale | |||||||||||
Net gains on sales of government guaranteed loans | ( | ( | |||||||||
Change in fair value of government guaranteed loans held for investment, at fair value | ( | ( | |||||||||
Amortization of loan servicing rights | |||||||||||
Net gain on sale of other real estate owned | ( | ||||||||||
Non-qualified stock purchase plan expense | |||||||||||
Stock based compensation expense | |||||||||||
Income from bank owned life insurance | ( | ( | |||||||||
Changes in: | |||||||||||
Accrued interest receivable | ( | ( | |||||||||
Other assets | |||||||||||
Accrued interest payable | ( | ( | |||||||||
Other liabilities | ( | ( | |||||||||
Net cash provided by operating activities of continuing operations | |||||||||||
Net cash provided by (used in) operating activities of discontinued operations | ( | ||||||||||
Net cash provided by operating activities | |||||||||||
Cash flows from investing activities: | |||||||||||
Purchase of investment securities available for sale | ( | ||||||||||
Principal payments on investment securities available for sale | |||||||||||
Purchase of investment securities held to maturity | ( | ||||||||||
Principal payments on investment securities held to maturity | |||||||||||
Call of investment securities held to maturity | |||||||||||
Net (purchase) sale of nonmarketable equity securities | ( | ||||||||||
Purchase of time deposits in banks | ( | ||||||||||
Maturity of time deposits in banks | |||||||||||
Purchase of government guaranteed and consumer loans | ( | ( | |||||||||
Loan (originations) and payments, net | ( | ( | |||||||||
Purchase of premises and equipment | ( | ( | |||||||||
Proceeds on sales of other real estate owned | |||||||||||
Net cash used in investing activities | ( | ( |
BAYFIRST FINANCIAL CORP. CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) CONTINUED (Dollars in thousands) |
Nine Months Ended September 30, | |||||||||||
2023 | 2022 | ||||||||||
Cash flows from financing activities: | |||||||||||
Net change in deposits | |||||||||||
Net increase (decrease) in short-term borrowings | ( | ||||||||||
Payments on notes payable | ( | ( | |||||||||
Net repayments of PPP Liquidity Facility borrowings | ( | ||||||||||
Proceeds from issuance of preferred stock, net | |||||||||||
Repayment of subordinated debt | ( | ||||||||||
Proceeds from issuance of common stock for benefit plans, net | |||||||||||
Common share buyback - redeemed stock | ( | ( | |||||||||
Unearned ESOP shares | ( | ||||||||||
Dividends paid on common stock | ( | ( | |||||||||
Dividends paid on preferred stock | ( | ( | |||||||||
Net cash provided by financing activities | |||||||||||
Net change in cash and cash equivalents | ( | ||||||||||
Cash and cash equivalents, beginning of period | |||||||||||
Cash and cash equivalents, end of period | $ | $ | |||||||||
Supplemental cash flow information | |||||||||||
Interest paid | $ | $ | |||||||||
Income taxes paid | |||||||||||
Supplemental noncash disclosures | |||||||||||
Impact to retained earnings from adoption of ASC 326, net of tax | ( | ||||||||||
Net change in unrealized holding losses on investment securities available for sale, net of tax effect | ( | ||||||||||
Transfer of available for sale debt securities to held to maturity securities at fair value | |||||||||||
Transfer of government guaranteed loans held for investment to loans held for sale | |||||||||||
Transfer of loans held for investment to OREO | |||||||||||
Transfer of premises and equipment to OREO | ( | ||||||||||
Recognition of right of use asset and operating lease liability | |||||||||||
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) (Unaudited) |
January 1, 2023 | December 31, 2022 | ||||||||||||||||
Allowance for credit losses | As Reported Under | Pre-ASC 326 | Impact of | ||||||||||||||
ASC 326 | Adoption | ASC 326 Adoption | |||||||||||||||
Assets | |||||||||||||||||
Investment securities HTM - corporate bonds | $ | $ | $ | ||||||||||||||
Loans HFI, at amortized cost | |||||||||||||||||
Real estate - residential | |||||||||||||||||
Real estate - commercial | |||||||||||||||||
Real estate - construction and land | |||||||||||||||||
Commercial and industrial | |||||||||||||||||
Consumer and other | ( | ||||||||||||||||
Unallocated | ( | ||||||||||||||||
Loans HFI, at amortized cost total | |||||||||||||||||
Liabilities | |||||||||||||||||
Allowance for credit loss for unfunded commitments | |||||||||||||||||
Total | $ | $ | $ |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) (Unaudited) |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) (Unaudited) |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) (Unaudited) |
September 30, 2023 | December 31, 2022 | ||||||||||
Assets | |||||||||||
Loans held for sale, at fair value | $ | $ | |||||||||
Loan servicing rights | |||||||||||
Right-of-use operating lease asset | |||||||||||
Accrued interest receivable | |||||||||||
Total assets | $ | $ | |||||||||
Liabilities | |||||||||||
Operating lease liability | $ | $ | |||||||||
Other liabilities | |||||||||||
Total liabilities | $ | $ |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Interest income | $ | $ | $ | $ | |||||||||||||||||||
Noninterest income | ( | ||||||||||||||||||||||
Total net revenue | ( | ||||||||||||||||||||||
Noninterest expense | |||||||||||||||||||||||
Loss from discontinued operations before income taxes | ( | ( | ( | ( | |||||||||||||||||||
Income tax benefit | ( | ( | ( | ( | |||||||||||||||||||
Net loss from discontinued operations | $ | ( | $ | ( | $ | ( | $ | ( |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
September 30, 2023 | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||||||||
Investment securities available for sale: | |||||||||||||||||||||||
Asset-backed securities | $ | $ | $ | ( | $ | ||||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||
U.S. Government-sponsored enterprises | ( | ||||||||||||||||||||||
Collateralized mortgage obligations: | |||||||||||||||||||||||
U.S. Government-sponsored enterprises | ( | ||||||||||||||||||||||
Corporate bonds | ( | ||||||||||||||||||||||
Total investment securities available for sale | $ | $ | $ | ( | $ |
September 30, 2023 | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ACL | ||||||||||||||||||||||||
Investment securities held to maturity: | |||||||||||||||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||||||||
U.S. Government-sponsored enterprises | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Corporate bonds | ( | ||||||||||||||||||||||||||||
Total investment securities held to maturity | $ | $ | $ | ( | $ | $ |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
December 31, 2022 | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||||||||
Investment securities available for sale: | |||||||||||||||||||||||
Asset-backed securities | $ | $ | $ | ( | $ | ||||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||
U.S. Government-sponsored enterprises | ( | ||||||||||||||||||||||
Collateralized mortgage obligations: | |||||||||||||||||||||||
U.S. Government-sponsored enterprises | ( | ||||||||||||||||||||||
Corporate bonds | ( | ||||||||||||||||||||||
Total investment securities available for sale | $ | $ | $ | ( | $ |
December 31, 2022 | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||||||||
Investment securities held to maturity: | |||||||||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||
U.S. Government-sponsored enterprises | $ | $ | $ | $ | |||||||||||||||||||
Corporate bonds | ( | ||||||||||||||||||||||
Total investment securities held to maturity | $ | $ | $ | ( | $ |
Available for Sale | Held to Maturity | ||||||||||||||||||||||
Amortized Cost | Fair Value | Amortized Cost | Fair Value | ||||||||||||||||||||
One to five years | $ | $ | $ | $ | |||||||||||||||||||
Five to ten years | |||||||||||||||||||||||
Beyond ten years | |||||||||||||||||||||||
Total | $ | $ | $ | $ |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
For the Three Months Ended | For the Nine Months Ended | ||||||||||
Corporate Bonds | September 30, 2023 | ||||||||||
Balance at beginning of period | $ | $ | |||||||||
Impact of adopting ASC 326 | |||||||||||
Provision for credit losses | |||||||||||
Investment securities charge-offs/recoveries | |||||||||||
Investment securities recoveries | |||||||||||
Balance at end of period | $ | $ |
Less than 12 Months | 12 Months or Longer | Total | |||||||||||||||||||||||||||||||||||||||
September 30, 2023 | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Number of Securities | ||||||||||||||||||||||||||||||||||
Investment securities available for sale: | |||||||||||||||||||||||||||||||||||||||||
Asset-backed securities | $ | $ | $ | $ | ( | $ | $ | ( | |||||||||||||||||||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||||||||||||||||||||
U.S. Government-sponsored enterprises | ( | ( | |||||||||||||||||||||||||||||||||||||||
Collateralized mortgage obligations: | |||||||||||||||||||||||||||||||||||||||||
U.S. Government-sponsored enterprises | ( | ( | |||||||||||||||||||||||||||||||||||||||
Corporate bonds | ( | ( | |||||||||||||||||||||||||||||||||||||||
Total investment securities available for sale | $ | $ | ( | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||||||||
Investment securities held to maturity: | |||||||||||||||||||||||||||||||||||||||||
Corporate bonds | $ | $ | $ | $ | ( | $ | $ | ( | |||||||||||||||||||||||||||||||||
Total investment securities held to maturity | $ | $ | $ | $ | ( | $ | $ | ( |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
Less than 12 Months | 12 Months or Longer | Total | |||||||||||||||||||||||||||||||||||||||
December 31, 2022 | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Number of Securities | ||||||||||||||||||||||||||||||||||
Investment securities available for sale: | |||||||||||||||||||||||||||||||||||||||||
Asset-backed securities | $ | $ | ( | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||||||||||||||||||||
U.S. Government-sponsored enterprises | ( | ( | |||||||||||||||||||||||||||||||||||||||
Collateralized mortgage obligations: | |||||||||||||||||||||||||||||||||||||||||
U.S. Government-sponsored enterprises | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
Corporate bonds | ( | ( | |||||||||||||||||||||||||||||||||||||||
Total investment securities available for sale | $ | $ | ( | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||||||||
Investment securities held to maturity: | |||||||||||||||||||||||||||||||||||||||||
Corporate bonds | $ | $ | ( | $ | $ | $ | $ | ( | |||||||||||||||||||||||||||||||||
Total investment securities held to maturity | $ | $ | ( | $ | $ | $ | $ | ( |
September 30, 2023 | December 31, 2022 | ||||||||||
Real estate: | |||||||||||
Residential | $ | $ | |||||||||
Commercial | |||||||||||
Construction and land | |||||||||||
Commercial and industrial | |||||||||||
Commercial and industrial - PPP | |||||||||||
Consumer and other | |||||||||||
Loans held for investment, at amortized cost, gross | |||||||||||
Deferred loan costs, net | |||||||||||
Discount on government guaranteed loans sold(1) | ( | ( | |||||||||
Premium on loans purchased, net | |||||||||||
Allowance for credit losses | ( | ( | |||||||||
Loans held for investment, at amortized cost | $ | $ |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
Three Months Ended | Real Estate - Residential | Real Estate - Commercial | Real Estate - Construction and Land | Commercial and Industrial | Consumer and Other | Unallocated | Total | ||||||||||||||||||||||||||||||||||
September 30, 2023 | |||||||||||||||||||||||||||||||||||||||||
Beginning Balance | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Charge-offs | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||
Recoveries | |||||||||||||||||||||||||||||||||||||||||
Provision | ( | ||||||||||||||||||||||||||||||||||||||||
Ending Balance | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
September 30, 2022 | |||||||||||||||||||||||||||||||||||||||||
Beginning Balance | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Charge-offs | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
Recoveries | |||||||||||||||||||||||||||||||||||||||||
Provision | ( | ( | |||||||||||||||||||||||||||||||||||||||
Ending Balance | $ | $ | $ | $ | $ | $ | $ |
Real Estate - Residential | Real Estate - Commercial | Real Estate - Construction and Land | Commercial and Industrial | Consumer and Other | Unallocated | Total | |||||||||||||||||||||||||||||||||||
Nine Months Ended | |||||||||||||||||||||||||||||||||||||||||
September 30, 2023 | |||||||||||||||||||||||||||||||||||||||||
Beginning Balance | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Impact of adopting ASC 326 | ( | ( | |||||||||||||||||||||||||||||||||||||||
Charge-offs | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||
Recoveries | |||||||||||||||||||||||||||||||||||||||||
Provision | |||||||||||||||||||||||||||||||||||||||||
Ending Balance | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
September 30, 2022 | |||||||||||||||||||||||||||||||||||||||||
Beginning Balance | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Charge-offs | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||
Recoveries | |||||||||||||||||||||||||||||||||||||||||
Provision | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||
Ending Balance | $ | $ | $ | $ | $ | $ | $ |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
For the Three Months Ended | For the Nine Months Ended | ||||||||||
September 30, 2023 | |||||||||||
Balance at beginning of period | $ | $ | |||||||||
Provision for credit losses | |||||||||||
Unfunded commitments charge-offs | |||||||||||
Unfunded commitments recoveries | |||||||||||
Balance at end of period | $ | $ |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
September 30, 2023 | Nonaccrual with no ACL | Nonaccrual with ACL | Loans Past Due Over 89 Days Still Accruing | |||||||||||||||||
Real estate - residential | $ | $ | $ | |||||||||||||||||
Real estate - commercial | ||||||||||||||||||||
Commercial and industrial | ||||||||||||||||||||
Consumer and other | ||||||||||||||||||||
Total | $ | $ | $ |
December 31, 2022 | Nonaccrual | Loans Past Due Over 89 Days Still Accruing | ||||||||||||
Real estate - commercial | $ | $ | ||||||||||||
Commercial and industrial | ||||||||||||||
Consumer and other | ||||||||||||||
Total | $ | $ |
Type of Collateral | ACL | |||||||||||||
Business Assets | ||||||||||||||
Commercial and industrial | $ | $ | ||||||||||||
30-89 Days Past Due | Greater Than 89 Days Past Due | Total Past Due | Loans Not Past Due (1) | Total Loans | |||||||||||||||||||||||||
Real estate - residential | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Real estate - commercial | |||||||||||||||||||||||||||||
Real estate - construction and land | |||||||||||||||||||||||||||||
Commercial and industrial | |||||||||||||||||||||||||||||
Commercial and industrial - PPP | |||||||||||||||||||||||||||||
Consumer and other | |||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
(1) $ |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
30-89 Days Past Due | Greater Than 89 Days Past Due | Total Past Due | Loans Not Past Due (1) | Total Loans | |||||||||||||||||||||||||
Real estate - residential | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Real estate - commercial | |||||||||||||||||||||||||||||
Real estate - construction and land | |||||||||||||||||||||||||||||
Commercial and industrial | |||||||||||||||||||||||||||||
Commercial and industrial - PPP | |||||||||||||||||||||||||||||
Consumer and other | |||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
(1) $ |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
Revolving | Revolving | ||||||||||||||||||||||||||||||||||||||||
Loans | Loans | ||||||||||||||||||||||||||||||||||||||||
Term Loans Amortized Cost Basis by Origination Year | Amortized | Converted | |||||||||||||||||||||||||||||||||||||||
2023 | 2022 | 2021 | Prior | Cost Basis | to Term | Total | |||||||||||||||||||||||||||||||||||
Real estate - commercial | |||||||||||||||||||||||||||||||||||||||||
Risk Rating | |||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Special mention | |||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||
Total real estate - commercial loans | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Gross write offs | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Real estate - construction and land | |||||||||||||||||||||||||||||||||||||||||
Risk Rating | |||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Special mention | |||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||
Total real estate - construction and land loans | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Gross write offs | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Commercial and industrial | |||||||||||||||||||||||||||||||||||||||||
Risk Rating | |||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Special mention | |||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||
Total commercial and industrial loans | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Gross write offs | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Commercial and industrial - PPP | |||||||||||||||||||||||||||||||||||||||||
Risk Rating | |||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Special mention | |||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||
Doubtful |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
Revolving | Revolving | ||||||||||||||||||||||||||||||||||||||||
Loans | Loans | ||||||||||||||||||||||||||||||||||||||||
Term Loans Amortized Cost Basis by Origination Year | Amortized | Converted | |||||||||||||||||||||||||||||||||||||||
2023 | 2022 | 2021 | Prior | Cost Basis | to Term | Total | |||||||||||||||||||||||||||||||||||
Total commercial and industrial - PPP loans | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Gross write offs | $ | $ | $ | $ | $ | $ | $ |
Revolving | Revolving | ||||||||||||||||||||||||||||||||||||||||
Loans | Loans | ||||||||||||||||||||||||||||||||||||||||
Term Loans Amortized Cost Basis by Origination Year | Amortized | Converted | |||||||||||||||||||||||||||||||||||||||
2023 | 2022 | 2021 | Prior | Cost Basis | to Term | Total | |||||||||||||||||||||||||||||||||||
Real estate - residential | |||||||||||||||||||||||||||||||||||||||||
Payment Performance | |||||||||||||||||||||||||||||||||||||||||
Performing | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Nonperforming | |||||||||||||||||||||||||||||||||||||||||
Total real estate - residential loans | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Gross write offs | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Consumer and other | |||||||||||||||||||||||||||||||||||||||||
Payment Performance | |||||||||||||||||||||||||||||||||||||||||
Performing | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Nonperforming | |||||||||||||||||||||||||||||||||||||||||
Total consumer and other loans | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Gross write offs | $ | $ | $ | $ | $ | $ | $ |
Pass | Special Mention | Substandard | Doubtful | Total Loans | |||||||||||||||||||||||||
Real estate - residential | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Real estate - commercial | |||||||||||||||||||||||||||||
Real estate - construction and land | |||||||||||||||||||||||||||||
Commercial and industrial | |||||||||||||||||||||||||||||
Commercial and industrial - PPP | |||||||||||||||||||||||||||||
Consumer and other | |||||||||||||||||||||||||||||
Loans held for investment, at amortized cost | $ | $ | $ | $ | $ |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
Real Estate- Residential | Real Estate- Commercial | Real Estate - Construction and Land | Commercial and Industrial | Commercial and Industrial - PPP | Consumer and Other | Unallocated | Total | ||||||||||||||||||||||||||||||||||||||||
Allowance for loan losses: | |||||||||||||||||||||||||||||||||||||||||||||||
Individually evaluated for impairment | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Collectively evaluated for impairment | |||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Loans: | |||||||||||||||||||||||||||||||||||||||||||||||
Individually evaluated for impairment | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Collectively evaluated for impairment | |||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | $ | $ |
Unpaid Principal Balance | Recorded Investment | Allowance for Credit Losses Allocated | Average Recorded Investment | Interest Income Recognized | Cash Basis Interest Recognized | ||||||||||||||||||||||||||||||
With no related allowance recorded: | |||||||||||||||||||||||||||||||||||
Real estate - residential | $ | $ | $ | — | $ | $ | $ | ||||||||||||||||||||||||||||
Real estate - commercial | — | ||||||||||||||||||||||||||||||||||
Subtotal | — | ||||||||||||||||||||||||||||||||||
With an allowance recorded: | |||||||||||||||||||||||||||||||||||
Real estate - commercial | |||||||||||||||||||||||||||||||||||
Commercial and industrial | |||||||||||||||||||||||||||||||||||
Subtotal | |||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | ||||||||||||||||||||
Financial assets | |||||||||||||||||||||||
Investment securities available for sale | $ | $ | $ | $ | |||||||||||||||||||
Government guaranteed loans held for investment, at fair value | |||||||||||||||||||||||
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | ||||||||||||||||||||
Financial assets | |||||||||||||||||||||||
Investment securities available for sale | $ | $ | $ | $ | |||||||||||||||||||
Residential loans held for sale (1) | |||||||||||||||||||||||
Government guaranteed loans held for investment, at fair value | |||||||||||||||||||||||
December 31, 2022 | |||||
Aggregate fair value | $ | ||||
Contractual balance | |||||
Gain | $ |
Nine Months Ended September 30, | |||||||||||
2023 | 2022 | ||||||||||
Interest income | $ | $ | |||||||||
Change in fair value | ( | ( | |||||||||
Total loss | $ | ( | $ | ( |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
September 30, 2023 | December 31, 2022 | ||||||||||
Aggregate fair value | $ | $ | |||||||||
Contractual balance | |||||||||||
Gain | $ | $ |
Nine Months Ended September 30, | |||||||||||
2023 | 2022 | ||||||||||
Interest income | $ | $ | |||||||||
Change in fair value | |||||||||||
Total gain (loss) | $ | $ |
Nine Months Ended September 30, | |||||||||||
2023 | 2022 | ||||||||||
Balance of government guaranteed loans held for investment at fair value, beginning of period | $ | $ | |||||||||
New government guaranteed originations at fair value | |||||||||||
Loans sold | ( | ( | |||||||||
Principal payments | ( | ( | |||||||||
Charge-offs | ( | ||||||||||
Total gains during the period | |||||||||||
Balance of government guaranteed loans held for investment at fair value, end of period | $ | $ |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
Fair Value | Valuation Technique | Unobservable Inputs | Range (Weighted Average) | ||||||||||||||||||||
September 30, 2023 | |||||||||||||||||||||||
Government guaranteed loans held for investment, | $ | Discounted | Discount rate | ||||||||||||||||||||
at fair value | cash flow | Conditional prepayment rate | |||||||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||
Government guaranteed loans held for investment, | $ | Discounted | Discount rate | ||||||||||||||||||||
at fair value | cash flow | Conditional prepayment rate | |||||||||||||||||||||
Fair Value | Valuation Technique(s) | Significant Unobservable Input(s) | Discount % Amount | ||||||||||||||||||||
Individually evaluated loans | $ | Discounted appraisals, estimated net realizable value of collateral | Collateral discounts |
Fair Value | Valuation Technique(s) | Significant Unobservable Input(s) | Discount % Amount | ||||||||||||||||||||
Impaired loans | $ | Discounted appraisals, estimated net realizable value of collateral | Collateral discounts |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
September 30, 2023 | December 31, 2022 | ||||||||||||||||||||||||||||
Level | Carrying Value | Fair Value | Carrying Value | Fair Value | |||||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||||
Cash and cash equivalents | 1 | $ | $ | $ | $ | ||||||||||||||||||||||||
Time deposits in banks | 2 | ||||||||||||||||||||||||||||
Investment securities held to maturity | 2 | ||||||||||||||||||||||||||||
Nonmarketable equity securities, at cost | 2 | ||||||||||||||||||||||||||||
Government guaranteed loans held for sale | 2 | ||||||||||||||||||||||||||||
Loans held for investment, at amortized cost | 3 | ||||||||||||||||||||||||||||
Accrued interest receivable (1) | 2 | ||||||||||||||||||||||||||||
Government guaranteed loan servicing rights | 3 | ||||||||||||||||||||||||||||
Mortgage loan servicing rights(2) | 3 | ||||||||||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||||||
Noninterest-bearing deposits | 2 | $ | $ | $ | $ | ||||||||||||||||||||||||
Interest-bearing transaction accounts | 2 | ||||||||||||||||||||||||||||
Savings and money market deposits | 2 | ||||||||||||||||||||||||||||
Time deposits | 2 | ||||||||||||||||||||||||||||
FRB and FHLB borrowings | 2 | ||||||||||||||||||||||||||||
Subordinated debentures | 2 | ||||||||||||||||||||||||||||
Notes payable | 2 | ||||||||||||||||||||||||||||
Accrued interest payable | 2 |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, 2023 | September 30, 2022 | September 30, 2023 | September 30, 2022 | ||||||||||||||||||||
Beginning of period | $ | $ | $ | $ | |||||||||||||||||||
Additions | |||||||||||||||||||||||
Amortization | ( | ( | ( | ( | |||||||||||||||||||
End of period | $ | $ | $ | $ |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, 2023 | September 30, 2022 | September 30, 2023 | September 30, 2022 | ||||||||||||||||||||
Gain on sale of guaranteed government guaranteed loans | $ | $ | $ | $ | |||||||||||||||||||
Loss on sale of unguaranteed government guaranteed loans | ( | ( | ( | ||||||||||||||||||||
Costs recognized on sale of government guaranteed loans | ( | ( | ( | ||||||||||||||||||||
Fair value of servicing rights created | |||||||||||||||||||||||
Gain on sale of government guaranteed loans, net | $ | $ | $ | $ |
September 30, 2023 | December 31, 2022 | ||||||||||
Land and improvements | $ | $ | |||||||||
Building and improvements | |||||||||||
Leasehold improvements | |||||||||||
Furniture, fixtures, and equipment | |||||||||||
Fixed assets in process | |||||||||||
Total premises and equipment | |||||||||||
Accumulated depreciation and amortization | ( | ( | |||||||||
Net premises and equipment (1) | $ | $ |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Operating lease cost | $ | $ | $ | $ | |||||||||||||||||||
Short-term lease cost | ( | ( | |||||||||||||||||||||
Total lease cost, net (1) | $ | $ | $ | $ |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Cash flows related to operating lease liabilities | $ | $ | $ | $ | |||||||||||||||||||
Right-of-use assets obtained in exchange for new operating lease liabilities |
2023 | $ | ||||
2024 | |||||
2025 | |||||
2026 | |||||
2027 | |||||
Thereafter | |||||
Total undiscounted lease payments | $ | ||||
Less: imputed interest | ( | ||||
$ |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
Shares | Weighted-Average Grant-Date Fair Value, per share | ||||||||||
Nonvested at January 1, 2023 | $ | ||||||||||
Granted | |||||||||||
Vested | ( | ( | |||||||||
Forfeited | ( | ( | |||||||||
Nonvested at September 30, 2023 | $ |
Shares | Weighted Average Exercise Price | Weighted Average Remaining Contractual Term (in years) | Aggregate Intrinsic Value | ||||||||||||||||||||
Outstanding at January 1, 2023 | $ | ||||||||||||||||||||||
Exercised | ( | ( | |||||||||||||||||||||
Forfeited | ( | ( | |||||||||||||||||||||
Outstanding at September 30, 2023 | $ | $ | |||||||||||||||||||||
Vested and exercisable at September 30, 2023 | $ | $ |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Federal tax based on federal corporate statutory rate | $ | $ | $ | $ | |||||||||||||||||||
State tax, net of federal effect | |||||||||||||||||||||||
Changes resulting from: | |||||||||||||||||||||||
BOLI income | ( | ( | ( | ( | |||||||||||||||||||
Other, net | ( | ( | |||||||||||||||||||||
Income tax expense from continuing operations | |||||||||||||||||||||||
Income tax (benefit) from discontinued operations | ( | ( | ( | ( | |||||||||||||||||||
Total income tax expense (benefit) | $ | $ | ( | $ | $ | ( |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
Actual | Required for Capital Adequacy Purposes | To be Well Capitalized Under Prompt Corrective Action Regulations | |||||||||||||||||||||||||||||||||
Amount | Ratio | Amount | Ratio | Amount | Ratio | ||||||||||||||||||||||||||||||
Total Capital | |||||||||||||||||||||||||||||||||||
(to Risk Weighted Assets) | $ | % | $ | % | $ | % | |||||||||||||||||||||||||||||
Tier 1 Capital | |||||||||||||||||||||||||||||||||||
(to Risk Weighted Assets) | $ | % | $ | % | $ | % | |||||||||||||||||||||||||||||
Common Equity Tier 1 Capital | |||||||||||||||||||||||||||||||||||
(to Risk Weighted Assets) | $ | % | $ | % | $ | % | |||||||||||||||||||||||||||||
Tier 1 Capital | |||||||||||||||||||||||||||||||||||
(to Average Assets) | $ | % | $ | % | $ | % |
Actual | Required for Capital Adequacy Purposes | To be Well Capitalized Under Prompt Corrective Action Regulations | |||||||||||||||||||||||||||||||||
Amount | Ratio | Amount | Ratio | Amount | Ratio | ||||||||||||||||||||||||||||||
Total Capital | |||||||||||||||||||||||||||||||||||
(to Risk Weighted Assets) | $ | % | $ | % | $ | % | |||||||||||||||||||||||||||||
Tier 1 Capital | |||||||||||||||||||||||||||||||||||
(to Risk Weighted Assets) | $ | % | $ | % | $ | % | |||||||||||||||||||||||||||||
Common Equity Tier 1 Capital | |||||||||||||||||||||||||||||||||||
(to Risk Weighted Assets) | $ | % | $ | % | $ | % | |||||||||||||||||||||||||||||
Tier 1 Capital | |||||||||||||||||||||||||||||||||||
(to Average Assets) | $ | % | $ | % | $ | % |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Net gain realized on sale of residential loans held for sale | $ | $ | $ | $ | |||||||||||||||||||
Net change in fair value recognized on residential loans held for sale | ( | ( | ( | ||||||||||||||||||||
Net change in fair value recognized on interest rate lock commitments | ( | ( | |||||||||||||||||||||
Net change in fair value recognized on mandatory and best efforts forward sales contracts | |||||||||||||||||||||||
Mortgage banking fees | |||||||||||||||||||||||
Residential loan fee income from discontinued operations | $ | $ | $ | ( | $ |
December 31, 2022 | |||||||||||
Notional Amount | Fair Value | ||||||||||
Included in other assets from discontinued operations: | |||||||||||
Best efforts forward sales contracts | $ | $ | |||||||||
September 30, 2023 | December 31, 2022 | ||||||||||
Unfunded loan commitments | $ | $ | |||||||||
Unused lines of credit | |||||||||||
Standby letters of credit |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Basic: | |||||||||||||||||||||||
Income from continuing operations | $ | $ | $ | $ | |||||||||||||||||||
Loss from discontinued operations | ( | ( | ( | ( | |||||||||||||||||||
Net income (loss) | ( | ( | |||||||||||||||||||||
Less: Preferred stock dividends | |||||||||||||||||||||||
Net income available to (loss attributable to) common shareholders | $ | $ | ( | $ | $ | ( | |||||||||||||||||
Weighted average common shares outstanding | |||||||||||||||||||||||
Basic earnings (loss) per common share: | |||||||||||||||||||||||
Continuing operations | $ | $ | $ | $ | |||||||||||||||||||
Discontinued operations | ( | ( | ( | ( | |||||||||||||||||||
Total | $ | $ | ( | $ | $ | ( | |||||||||||||||||
Diluted: | |||||||||||||||||||||||
Income from continuing operations | $ | $ | $ | $ | |||||||||||||||||||
Loss from discontinued operations | ( | ( | ( | ( | |||||||||||||||||||
Net income (loss) | ( | ( | |||||||||||||||||||||
Less: Preferred stock dividends | |||||||||||||||||||||||
Add: Series B preferred stock dividends | |||||||||||||||||||||||
Net income available to (loss attributable to) common shareholders | $ | $ | ( | $ | $ | ( | |||||||||||||||||
Weighted average common shares outstanding for basic earnings per common share | |||||||||||||||||||||||
Add: Dilutive effects of conversion of Series B preferred stock to common stock | |||||||||||||||||||||||
Add: Dilutive effects of assumed exercises of stock options and warrants | |||||||||||||||||||||||
Average shares and dilutive potential common shares | |||||||||||||||||||||||
Diluted earnings (loss) per common share: | |||||||||||||||||||||||
Continuing operations | $ | $ | $ | $ | |||||||||||||||||||
Discontinued operations | ( | ( | ( | ( | |||||||||||||||||||
Total | $ | $ | ( | $ | $ | ( |
BAYFIRST FINANCIAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share data) |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Common stock options | |||||||||||||||||||||||
As of and for the Three Months Ended | As of and for the Nine Months Ended | ||||||||||||||||||||||||||||
(Dollars in thousands, except for share data) | 9/30/2023 | 6/30/2023 | 9/30/2022 | 9/30/2023 | 9/30/2022 | ||||||||||||||||||||||||
Income Statement Data: | |||||||||||||||||||||||||||||
Net interest income | $ | 8,393 | $ | 10,108 | $ | 9,170 | $ | 27,554 | $ | 21,426 | |||||||||||||||||||
Provision for credit losses(1) | 3,001 | 2,765 | 750 | 7,708 | (1,400) | ||||||||||||||||||||||||
Noninterest income | 14,679 | 10,937 | 9,804 | 35,064 | 23,146 | ||||||||||||||||||||||||
Noninterest expense | 17,427 | 16,402 | 14,158 | 49,241 | 41,719 | ||||||||||||||||||||||||
Income tax expense (benefit) | 674 | 461 | 983 | 1,415 | 888 | ||||||||||||||||||||||||
Net income from continuing operations | 1,970 | 1,417 | 3,083 | 4,254 | 3,365 | ||||||||||||||||||||||||
Net loss from discontinued operations | (47) | (32) | (4,485) | (207) | (5,036) | ||||||||||||||||||||||||
Net income (loss) | 1,923 | 1,385 | (1,402) | 4,047 | (1,671) | ||||||||||||||||||||||||
Preferred stock dividends | 208 | 208 | 208 | 624 | 624 | ||||||||||||||||||||||||
Net income available to (loss attributable to) common shareholders | $ | 1,715 | $ | 1,177 | $ | (1,610) | $ | 3,423 | $ | (2,295) | |||||||||||||||||||
Balance Sheet Data: | |||||||||||||||||||||||||||||
Average loans held for investment, excluding PPP loans | $ | 841,920 | $ | 824,460 | $ | 663,716 | $ | 804,993 | $ | 582,432 | |||||||||||||||||||
Average loans held for investment at amortized cost, excluding PPP loans | 773,749 | 763,854 | 625,129 | 746,876 | 554,177 | ||||||||||||||||||||||||
Average total assets | 1,088,517 | 1,064,068 | 939,847 | 1,041,131 | 897,588 | ||||||||||||||||||||||||
Average common shareholders’ equity | 81,067 | 80,310 | 83,014 | 80,080 | 83,408 | ||||||||||||||||||||||||
Total loans held for investment | 878,447 | 836,704 | 680,805 | 878,447 | 680,805 | ||||||||||||||||||||||||
Total loans held for investment, excluding PPP loans | 863,203 | 821,016 | 658,669 | 863,203 | 658,669 | ||||||||||||||||||||||||
Total loans held for investment, excluding government guaranteed loan balances | 687,141 | 638,148 | 520,408 | 687,141 | 520,408 | ||||||||||||||||||||||||
Allowance for credit losses(1) | 13,365 | 12,598 | 9,739 | 13,365 | 9,739 | ||||||||||||||||||||||||
Total assets | 1,133,979 | 1,087,399 | 930,275 | 1,133,979 | 930,275 | ||||||||||||||||||||||||
Common shareholders’ equity | 82,725 | 81,460 | 81,032 | 82,725 | 81,032 |
As of and for the Three Months Ended | As of and for the Nine Months Ended | ||||||||||||||||||||||||||||
(Dollars in thousands, except for share data) | 9/30/2023 | 6/30/2023 | 9/30/2022 | 9/30/2023 | 9/30/2022 | ||||||||||||||||||||||||
Per Share Data: | |||||||||||||||||||||||||||||
Basic earnings (loss) per common share | $ | 0.42 | $ | 0.29 | $ | (0.40) | $ | 0.84 | $ | (0.57) | |||||||||||||||||||
Diluted earnings (loss) per common share | $ | 0.41 | $ | 0.29 | $ | (0.35) | $ | 0.83 | $ | (0.48) | |||||||||||||||||||
Dividends per common share | $ | 0.08 | $ | 0.08 | $ | 0.08 | $ | 0.24 | $ | 0.24 | |||||||||||||||||||
Book value per common share | $ | 20.12 | $ | 19.85 | $ | 20.10 | $ | 20.12 | $ | 20.10 | |||||||||||||||||||
Tangible book value per common share (2) | $ | 20.12 | $ | 19.85 | $ | 20.10 | $ | 20.12 | $ | 20.10 | |||||||||||||||||||
Performance Ratios: | |||||||||||||||||||||||||||||
Return on average assets(3) | 0.71 | % | 0.52 | % | (0.60) | % | 0.52 | % | (0.25) | % | |||||||||||||||||||
Return on average common equity(3) | 8.46 | % | 5.86 | % | (7.76) | % | 5.70 | % | (3.67) | % | |||||||||||||||||||
Net interest margin | 3.36 | % | 4.18 | % | 4.63 | % | 3.89 | % | 3.90 | % | |||||||||||||||||||
Dividend payout ratio | 19.15 | % | 27.89 | % | (20.02) | % | 28.72 | % | (41.99) | % | |||||||||||||||||||
Asset Quality Data: | |||||||||||||||||||||||||||||
Net charge-offs | $ | 2,234 | $ | 2,253 | $ | 575 | $ | 6,375 | $ | 2,313 | |||||||||||||||||||
Net charge-offs/average loans held for investment at amortized cost, excluding PPP(3) | 1.15 | % | 1.18 | % | 0.37 | % | 1.14 | % | 0.56 | % | |||||||||||||||||||
Nonperforming loans | $ | 10,393 | $ | 8,606 | $ | 10,267 | $ | 10,393 | $ | 10,267 | |||||||||||||||||||
Nonperforming loans (excluding government guaranteed balance) | $ | 8,776 | $ | 6,590 | $ | 4,015 | $ | 8,776 | $ | 4,015 | |||||||||||||||||||
Nonperforming loans/total loans held for investment | 1.18 | % | 1.03 | % | 1.51 | % | 1.18 | % | 1.51 | % | |||||||||||||||||||
Nonperforming loans (excluding gov’t guaranteed balance)/total loans held for investment | 1.00 | % | 0.79 | % | 0.59 | % | 1.00 | % | 0.59 | % | |||||||||||||||||||
ACL/Total loans held for investment at amortized cost(1) | 1.68 | % | 1.61 | % | 1.48 | % | 1.68 | % | 1.48 | % | |||||||||||||||||||
ACL/Total loans held for investment at amortized cost, excluding PPP loans(1) | 1.72 | % | 1.64 | % | 1.54 | % | 1.72 | % | 1.54 | % | |||||||||||||||||||
Other Data: | |||||||||||||||||||||||||||||
Full-time equivalent employees | 307 | 302 | 524 | 307 | 524 | ||||||||||||||||||||||||
Banking centers | 10 | 9 | 8 | 10 | 8 | ||||||||||||||||||||||||
(1) Prior to January 1, 2023, the incurred loss methodology was used to estimate credit losses. Beginning with that date, credit losses are estimated using the CECL methodology. | |||||||||||||||||||||||||||||
(2) See section entitled "GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures" below for a reconciliation to most comparable GAAP equivalent. | |||||||||||||||||||||||||||||
(3) Annualized |
Tangible Common Shareholders' Equity and Tangible Book Value Per Common Share | ||||||||||||||||||||
As of | ||||||||||||||||||||
(Dollars in thousands, except for share data) | September 30, 2023 | June 30, 2023 | September 30, 2022 | |||||||||||||||||
(Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||||||
Total shareholders’ equity | $ | 94,165 | $ | 91,065 | $ | 90,637 | ||||||||||||||
Less: Preferred stock liquidation preference | (11,440) | (9,605) | (9,605) | |||||||||||||||||
Total equity available to common shareholders | 82,725 | 81,460 | 81,032 | |||||||||||||||||
Less: Goodwill | — | — | — | |||||||||||||||||
Tangible common shareholders' equity | $ | 82,725 | $ | 81,460 | $ | 81,032 | ||||||||||||||
Common shares outstanding | 4,110,650 | 4,103,834 | 4,031,937 | |||||||||||||||||
Tangible book value per common share | $ | 20.12 | $ | 19.85 | $ | 20.10 |
Three Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2023 | 2022 | ||||||||||||||||||||||||||||||||||
(Dollars in thousands) | Average Balance | Interest | Yield | Average Balance | Interest | Yield | |||||||||||||||||||||||||||||
Interest-earning assets: | |||||||||||||||||||||||||||||||||||
Investment securities | $ | 43,383 | $ | 465 | 4.25 | % | $ | 50,196 | $ | 316 | 2.50 | % | |||||||||||||||||||||||
Loans, excluding PPP (1) (2) | 841,920 | 15,992 | 7.54 | 723,284 | 11,371 | 6.24 | |||||||||||||||||||||||||||||
PPP loans | 15,418 | 40 | 1.03 | 28,102 | 141 | 1.99 | |||||||||||||||||||||||||||||
Other | 91,749 | 1,123 | 4.86 | 57,583 | 318 | 2.19 | |||||||||||||||||||||||||||||
Total interest-earning assets | 992,470 | 17,620 | 7.04 | 859,165 | 12,146 | 5.61 | |||||||||||||||||||||||||||||
Noninterest-earning assets | 96,047 | 80,682 | |||||||||||||||||||||||||||||||||
Total assets | $ | 1,088,517 | $ | 939,847 | |||||||||||||||||||||||||||||||
Interest-bearing liabilities: | |||||||||||||||||||||||||||||||||||
NOW, MMDA and savings | $ | 633,657 | $ | 6,390 | 4.00 | $ | 587,331 | $ | 1,290 | 0.87 | |||||||||||||||||||||||||
Time deposits | 235,100 | 2,665 | 4.50 | 97,693 | 566 | 2.30 | |||||||||||||||||||||||||||||
Other borrowings | 15,714 | 172 | 4.34 | 44,929 | 258 | 2.28 | |||||||||||||||||||||||||||||
Total interest-bearing liabilities | 884,471 | 9,227 | 4.14 | 729,953 | 2,114 | 1.15 | |||||||||||||||||||||||||||||
Demand deposits | 100,734 | 106,846 | |||||||||||||||||||||||||||||||||
Noninterest-bearing liabilities | 12,600 | 10,429 | |||||||||||||||||||||||||||||||||
Shareholders’ equity | 90,712 | 92,619 | |||||||||||||||||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 1,088,517 | $ | 939,847 | |||||||||||||||||||||||||||||||
Net interest income | $ | 8,393 | $ | 10,032 | |||||||||||||||||||||||||||||||
Interest rate spread | 2.90 | 4.46 | |||||||||||||||||||||||||||||||||
Net interest margin (3) | 3.36 | 4.63 | |||||||||||||||||||||||||||||||||
Ratio of average interest-earning assets to average interest-bearing liabilities | 112.21 | % | 117.70 | % | |||||||||||||||||||||||||||||||
(1) Includes nonaccrual loans. | |||||||||||||||||||||||||||||||||||
(2) Includes no residential loans held for sale from discontinued operations as of September 30, 2023 and $59,568 at an average yield of 5.74% of residential loans held for sale from discontinued operations as of September 30, 2022. | |||||||||||||||||||||||||||||||||||
(3) Net interest margin represents net interest income divided by average total interest-earning assets. |
For the Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||
2023 | 2022 | ||||||||||||||||||||||||||||||||||
(Dollars in thousands) | Average Balance | Interest | Yield | Average Balance | Interest | Yield | |||||||||||||||||||||||||||||
Interest-earning assets: | |||||||||||||||||||||||||||||||||||
Investment securities | $ | 44,888 | $ | 1,398 | 4.16 | % | $ | 42,474 | $ | 642 | 2.02 | % | |||||||||||||||||||||||
Loans, excluding PPP (1) (2) | 805,049 | 45,346 | 7.53 | 654,604 | 26,398 | 5.39 | |||||||||||||||||||||||||||||
PPP loans | 17,337 | 130 | 1.00 | 40,566 | 880 | 2.90 | |||||||||||||||||||||||||||||
Other | 80,522 | 2,790 | 4.63 | 82,239 | 592 | 0.96 | |||||||||||||||||||||||||||||
Total interest-earning assets | 947,796 | 49,664 | 7.01 | 819,883 | 28,512 | 4.65 | |||||||||||||||||||||||||||||
Noninterest-earning assets | 93,335 | 77,705 | |||||||||||||||||||||||||||||||||
Total assets | $ | 1,041,131 | $ | 897,588 | |||||||||||||||||||||||||||||||
Interest-bearing liabilities: | |||||||||||||||||||||||||||||||||||
NOW, MMDA and savings | $ | 620,237 | $ | 15,598 | 3.36 | $ | 613,613 | $ | 3,350 | 0.73 | |||||||||||||||||||||||||
Time deposits | 186,827 | 5,478 | 3.92 | 54,714 | 783 | 1.91 | |||||||||||||||||||||||||||||
PPPLF advances | — | — | — | 7,577 | 20 | 0.35 | |||||||||||||||||||||||||||||
Other borrowings | 30,325 | 1,033 | 4.55 | 22,177 | 467 | 2.82 | |||||||||||||||||||||||||||||
Total interest-bearing liabilities | 837,389 | 22,109 | 3.53 | 698,081 | 4,620 | 0.88 | |||||||||||||||||||||||||||||
Demand deposits | 101,661 | 99,234 | |||||||||||||||||||||||||||||||||
Noninterest-bearing liabilities | 12,383 | 7,260 | |||||||||||||||||||||||||||||||||
Shareholders’ equity | 89,698 | 93,013 | |||||||||||||||||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 1,041,131 | $ | 897,588 | |||||||||||||||||||||||||||||||
Net interest income | $ | 27,555 | $ | 23,892 | |||||||||||||||||||||||||||||||
Interest rate spread | 3.48 | 3.77 | |||||||||||||||||||||||||||||||||
Net interest margin (3) | 3.89 | 3.90 | |||||||||||||||||||||||||||||||||
Ratio of average interest-earning assets to average interest-bearing liabilities | 113.18 | % | 117.45 | % | |||||||||||||||||||||||||||||||
(1) Includes nonaccrual loans. | |||||||||||||||||||||||||||||||||||
(2) Includes $56 at an average yield of 2.02% and $72,172 at an average yield of 4.57% of residential loans held for sale from discontinued operations as of September 30, 2023 and September 30, 2022, respectively. | |||||||||||||||||||||||||||||||||||
(3) Net interest margin represents net interest income divided by average total interest-earning assets. |
(Dollars in thousands) | Rate | Volume | Total | ||||||||||||||
Three Months Ended September 30, 2023 vs. September 30, 2022: | |||||||||||||||||
Interest-earning assets: | |||||||||||||||||
Investment securities | $ | 197 | $ | (48) | $ | 149 | |||||||||||
Loans, excluding PPP | 2,585 | 2,036 | 4,621 | ||||||||||||||
PPP loans | (52) | (49) | (101) | ||||||||||||||
Other interest-earning assets | 541 | 264 | 805 | ||||||||||||||
Total interest-earning assets | 3,271 | 2,203 | 5,474 | ||||||||||||||
Interest-bearing liabilities: | |||||||||||||||||
NOW, MMDA and savings | 4,990 | 110 | 5,100 | ||||||||||||||
Time deposits | 850 | 1,249 | 2,099 | ||||||||||||||
Other borrowings | 145 | (231) | (86) | ||||||||||||||
Total interest-bearing liabilities | 5,985 | 1,128 | 7,113 | ||||||||||||||
Net change in net interest income | $ | (2,714) | $ | 1,075 | $ | (1,639) |
(Dollars in thousands) | Rate | Volume | Total | ||||||||||||||
Nine Months Ended September 30, 2023 vs. September 30, 2022: | |||||||||||||||||
Interest-earning assets: | |||||||||||||||||
Investment securities | $ | 718 | $ | 38 | $ | 756 | |||||||||||
Loans, excluding PPP(1) | 11,998 | 6,950 | 18,948 | ||||||||||||||
PPP loans | (400) | (350) | (750) | ||||||||||||||
Other interest-earning assets | 2,211 | (13) | 2,198 | ||||||||||||||
Total interest-earning assets | 14,527 | 6,625 | 21,152 | ||||||||||||||
Interest-bearing liabilities: | |||||||||||||||||
NOW, MMDA, and savings | 12,211 | 37 | 12,248 | ||||||||||||||
Time deposits | 1,422 | 3,273 | 4,695 | ||||||||||||||
PPPLF advances | — | (20) | (20) | ||||||||||||||
Other borrowings | 355 | 211 | 566 | ||||||||||||||
Total interest-bearing liabilities | 13,988 | 3,501 | 17,489 | ||||||||||||||
Net change in net interest income | $ | 539 | $ | 3,124 | $ | 3,663 | |||||||||||
(1) Includes $1 and $2,466 of interest income on residential loans held for sale from discontinued operations as of September 30, 2023 and September 30, 2022, respectively. |
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||||||||||
(Dollars in thousands) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Noninterest income: | |||||||||||||||||||||||
Loan servicing income, net | $ | 760 | $ | 620 | $ | 2,149 | $ | 1,508 | |||||||||||||||
Gain on sale of government guaranteed loans, net | 7,139 | 7,446 | 17,576 | 15,915 | |||||||||||||||||||
Service charges and fees | 408 | 347 | 1,166 | 951 | |||||||||||||||||||
Government guaranteed loan fair value gain | 4,543 | 999 | 11,021 | 3,510 | |||||||||||||||||||
Government guaranteed loan packaging fees | 1,158 | 208 | 2,076 | 496 | |||||||||||||||||||
Other noninterest income | 671 | 184 | 1,076 | 766 | |||||||||||||||||||
Total noninterest income | $ | 14,679 | $ | 9,804 | $ | 35,064 | $ | 23,146 |
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||||||||||
(Dollars in thousands) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Noninterest expense: | |||||||||||||||||||||||
Salaries and benefits | $ | 7,912 | $ | 6,758 | $ | 23,527 | $ | 21,177 | |||||||||||||||
Bonus, commissions, and incentives | 1,406 | 883 | 3,515 | 1,833 | |||||||||||||||||||
Occupancy and equipment | 1,262 | 1,070 | 3,608 | 3,010 | |||||||||||||||||||
Data processing | 1,526 | 1,247 | 4,189 | 3,486 | |||||||||||||||||||
Marketing and business development | 929 | 662 | 2,696 | 2,100 | |||||||||||||||||||
Professional services | 816 | 956 | 2,587 | 3,089 | |||||||||||||||||||
Loan origination and collection | 1,981 | 1,068 | 4,697 | 2,486 | |||||||||||||||||||
Employee recruiting and development | 543 | 518 | 1,667 | 1,653 | |||||||||||||||||||
Regulatory assessments | 284 | 110 | 615 | 299 | |||||||||||||||||||
Director compensation | 147 | 177 | 438 | 514 | |||||||||||||||||||
Liability and fidelity bond insurance | 148 | 119 | 403 | 349 | |||||||||||||||||||
ATM and interchange | 154 | 133 | 359 | 293 | |||||||||||||||||||
Telecommunication | 90 | 99 | 275 | 273 | |||||||||||||||||||
Other noninterest expense | 229 | 358 | 665 | 1,157 | |||||||||||||||||||
Total noninterest expense | $ | 17,427 | $ | 14,158 | $ | 49,241 | $ | 41,719 |
(Dollars in thousands) | September 30, 2023 | December 31, 2022 | |||||||||
Investment securities available for sale: | |||||||||||
Asset-backed securities | $ | 8,527 | $ | 9,605 | |||||||
Mortgage-backed securities: | |||||||||||
U.S. Government-sponsored enterprises | 3,102 | 3,440 | |||||||||
Collateralized mortgage obligations: | |||||||||||
U.S. Government-sponsored enterprises | 16,719 | 18,220 | |||||||||
Corporate bonds | 11,335 | 11,084 | |||||||||
Total investment securities available for sale | $ | 39,683 | $ | 42,349 |
(Dollars in thousands) | September 30, 2023 | December 31, 2022 | |||||||||
Investment securities held to maturity: | |||||||||||
Mortgage-backed securities: | |||||||||||
U.S. Government-sponsored enterprises | $ | 1 | $ | 2 | |||||||
Corporate bonds | 2,500 | 5,000 | |||||||||
Total investment securities held to maturity | $ | 2,501 | $ | 5,002 |
September 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||
One year or less | One to five years | Five to ten years | After ten years | ||||||||||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | Amortized Cost | Average Yield | Amortized Cost | Average Yield | Amortized Cost | Average Yield | Amortized Cost | Average Yield | |||||||||||||||||||||||||||||||||||||||
Asset-backed securities | $ | — | — | % | $ | — | — | % | $ | — | — | % | $ | 8,597 | 6.37 | % | |||||||||||||||||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||||||||||||||||||||||||||
U.S. Government-sponsored enterprises | — | — | — | — | — | — | 3,909 | 1.56 | |||||||||||||||||||||||||||||||||||||||
Collateralized mortgage obligations: | |||||||||||||||||||||||||||||||||||||||||||||||
U.S. Government-sponsored enterprises | — | — | — | — | — | — | 20,730 | 1.84 | |||||||||||||||||||||||||||||||||||||||
Corporate bonds | — | — | 11,333 | 6.37 | — | — | — | — | |||||||||||||||||||||||||||||||||||||||
Total investment securities available for sale | $ | — | — | % | $ | 11,333 | 6.37 | % | $ | — | — | % | $ | 33,236 | 2.98 | % |
December 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||
One year or less | One to five years | Five to ten years | After ten years | ||||||||||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | Amortized Cost | Average Yield | Amortized Cost | Average Yield | Amortized Cost | Average Yield | Amortized Cost | Average Yield | |||||||||||||||||||||||||||||||||||||||
Asset-backed securities | $ | — | — | % | $ | — | — | % | $ | — | — | % | $ | 9,873 | 5.40 | % | |||||||||||||||||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||||||||||||||||||||||||||
U.S. Government-sponsored enterprises | — | — | — | — | — | — | 4,133 | 1.55 | |||||||||||||||||||||||||||||||||||||||
Collateralized mortgage obligations: | |||||||||||||||||||||||||||||||||||||||||||||||
U.S. Government-sponsored enterprises | — | — | — | — | — | — | 22,031 | 1.89 | |||||||||||||||||||||||||||||||||||||||
Corporate bonds | — | — | 9,981 | 3.70 | 1,356 | 4.34 | — | — | |||||||||||||||||||||||||||||||||||||||
Total investment securities available for sale | $ | — | — | % | $ | 9,981 | 3.70 | % | $ | 1,356 | 4.34 | % | $ | 36,037 | 2.81 | % |
September 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||
One year or less | One to five years | Five to ten years | After ten years | ||||||||||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | Amortized Cost | Average Yield | Amortized Cost | Average Yield | Amortized Cost | Average Yield | Amortized Cost | Average Yield | |||||||||||||||||||||||||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||||||||||||||||||||||||||
U.S. Government-sponsored enterprises | $ | — | — | % | $ | — | — | % | $ | — | — | % | $ | 1 | 2.45 | % | |||||||||||||||||||||||||||||||
Corporate bonds | — | — | 1,500 | 4.38 | 1,000 | 4.38 | — | — | |||||||||||||||||||||||||||||||||||||||
Total investment securities held to maturity | $ | — | — | % | $ | 1,500 | 4.38 | % | $ | 1,000 | 4.38 | % | $ | 1 | 2.45 | % |
December 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||
One year or less | One to five years | Five to ten years | After ten years | ||||||||||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | Amortized Cost | Average Yield | Amortized Cost | Average Yield | Amortized Cost | Average Yield | Amortized Cost | Average Yield | |||||||||||||||||||||||||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||||||||||||||||||||||||||
U.S. Government-sponsored enterprises | $ | — | — | % | $ | — | — | % | $ | — | — | % | $ | 2 | 2.65 | % | |||||||||||||||||||||||||||||||
Corporate bonds | — | — | 4,000 | 5.79 | 1,000 | 4.38 | — | — | |||||||||||||||||||||||||||||||||||||||
Total investment securities held to maturity | $ | — | — | % | $ | 4,000 | 5.79 | % | $ | 1,000 | 4.38 | % | $ | 2 | 2.65 | % |
September 30, 2023 | December 31, 2022 | ||||||||||||||||||||||
(Dollars in thousands) | Amount | % of Total | Amount | % of Total | |||||||||||||||||||
Residential loans held for sale from discontinued operations | $ | — | $ | 449 | |||||||||||||||||||
Government guaranteed loans, held for sale | $ | 1,855 | $ | — | |||||||||||||||||||
Government guaranteed loans held for investment, at fair value | $ | 84,178 | $ | 27,078 | |||||||||||||||||||
Loans held for investment, at amortized cost: | |||||||||||||||||||||||
Residential real estate | $ | 248,973 | 31.8 | % | $ | 202,329 | 29.1 | % | |||||||||||||||
Commercial real estate | 280,620 | 35.8 | 231,281 | 33.3 | |||||||||||||||||||
Construction and land | 25,339 | 3.2 | 9,320 | 1.3 | |||||||||||||||||||
Commercial and industrial | 174,238 | 22.2 | 194,643 | 28.0 | |||||||||||||||||||
Commercial and industrial – PPP | 15,364 | 2.0 | 19,293 | 2.8 | |||||||||||||||||||
Consumer and other | 39,024 | 5.0 | 37,288 | 5.5 | |||||||||||||||||||
Loans held for investment, at amortized cost, gross | 783,558 | 100.0 | % | 694,154 | 100.0 | % | |||||||||||||||||
Discount on government guaranteed loans sold | (6,623) | (5,621) | |||||||||||||||||||||
Premium on loans purchased, net | 4,406 | 2,301 | |||||||||||||||||||||
Deferred loan costs, net | 12,928 | 10,740 | |||||||||||||||||||||
Allowance for credit losses(1) | (13,365) | (9,046) | |||||||||||||||||||||
Loans held for investment, at amortized cost, net | $ | 780,904 | $ | 692,528 | |||||||||||||||||||
(1) Prior to January 1, 2023, the incurred loss methodology was used to estimate credit losses. Beginning with that date, credit losses are estimated using the CECL methodology. |
(Dollars in thousands) | Due in One Year or Less | Due After One Year to Five Years | Due After Five Years to 15 Years | Due After 15 Years | Total | ||||||||||||||||||||||||
Real estate: | |||||||||||||||||||||||||||||
Residential | $ | 1,914 | $ | 1,465 | $ | 14,727 | $ | 231,342 | $ | 249,448 | |||||||||||||||||||
Commercial | 14,186 | 1,407 | 40,447 | 257,228 | 313,268 | ||||||||||||||||||||||||
Construction and land | 5,561 | 2,797 | 86 | 16,894 | 25,338 | ||||||||||||||||||||||||
Commercial and industrial | 7,992 | 23,398 | 195,175 | 7,941 | 234,506 | ||||||||||||||||||||||||
Commercial and industrial - PPP | 810 | 14,433 | — | — | 15,243 | ||||||||||||||||||||||||
Consumer and other | 1,763 | 30,025 | 7,939 | 917 | 40,644 | ||||||||||||||||||||||||
Total loans held for investment | $ | 32,226 | $ | 73,525 | $ | 258,374 | $ | 514,322 | $ | 878,447 |
(Dollars in thousands) | Fixed Interest Rate | Adjustable Interest Rate | |||||||||
Real estate: | |||||||||||
Residential | $ | 59,504 | $ | 188,030 | |||||||
Commercial | 12,530 | 286,552 | |||||||||
Construction and land | — | 19,777 | |||||||||
Commercial and industrial | 9,981 | 216,533 | |||||||||
Commercial and industrial - PPP | 14,433 | — | |||||||||
Consumer and other | 17,275 | 21,606 | |||||||||
Total loans held for investment | $ | 113,723 | $ | 732,498 |
(Dollars in thousands) | September 30, 2023 | September 30, 2022 | |||||||||
Nonperforming loans (government guaranteed balances) | $ | 1,617 | $ | 6,252 | |||||||
Nonperforming loans (unguaranteed balances) | 8,776 | 4,015 | |||||||||
Total nonperforming loans | 10,393 | 10,267 | |||||||||
OREO | — | 56 | |||||||||
Total nonperforming assets | $ | 10,393 | $ | 10,323 | |||||||
Nonperforming loans as a percentage of total loans held for investment | 1.18 | % | 1.51 | % | |||||||
Nonperforming loans (excluding government guaranteed balances) to total loans held for investment | 1.00 | % | 0.59 | % | |||||||
Nonperforming assets as a percentage of total assets | 0.92 | % | 1.11 | % | |||||||
Nonperforming assets (excluding government guaranteed balances) to total assets | 0.77 | % | 0.44 | % | |||||||
ACL to nonperforming loans | 128.60 | % | 94.86 | % | |||||||
ACL to nonperforming loans (excluding government guaranteed balances) | 152.29 | % | 242.57 | % |
(Dollars in thousands) | At and for the Three Months Ended September 30, | At and for the Nine Months Ended September 30, | |||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Allowance at beginning of period | $ | 12,598 | $ | 9,564 | $ | 9,046 | $ | 13,452 | |||||||||||||||
Impact of adopting ASC 326 | — | — | 3,107 | — | |||||||||||||||||||
Charge-offs: | |||||||||||||||||||||||
Commercial real estate | (108) | 36 | (108) | (17) | |||||||||||||||||||
Commercial and industrial | (1,542) | (697) | (4,660) | (2,667) | |||||||||||||||||||
Consumer and other | (874) | (68) | (2,214) | (109) | |||||||||||||||||||
Total charge-offs | (2,524) | (729) | (6,982) | (2,793) | |||||||||||||||||||
Recoveries: | |||||||||||||||||||||||
Commercial real estate | 75 | 13 | 77 | 74 | |||||||||||||||||||
Commercial and industrial | 114 | 105 | 303 | 365 | |||||||||||||||||||
Consumer and other | 93 | 36 | 219 | 41 | |||||||||||||||||||
Total recoveries | 290 | 154 | 607 | 480 | |||||||||||||||||||
Net charge-offs | (2,234) | (575) | (6,375) | (2,313) | |||||||||||||||||||
Provision for credit losses | 3,001 | 750 | 7,587 | (1,400) | |||||||||||||||||||
Allowance at end of period | $ | 13,365 | $ | 9,739 | $ | 13,365 | $ | 9,739 | |||||||||||||||
Net charge-offs to average loans held for investment at amortized cost (annualized) | 1.13 | % | 0.35 | % | 1.11 | % | 0.52 | % | |||||||||||||||
Allowance as a percent of total loans held for investment at amortized cost | 1.68 | % | 1.48 | % | 1.68 | % | 1.48 | % | |||||||||||||||
Allowance as a percent of loans held for investment at amortized cost, not including government guaranteed loans | 2.03 | % | 1.90 | % | 2.03 | % | 1.90 | % | |||||||||||||||
Allowance as a percent of nonperforming loans | 128.60 | % | 94.86 | % | 128.60 | % | 94.86 | % | |||||||||||||||
Total loans held for investment | $ | 878,447 | $ | 680,805 | $ | 878,447 | $ | 680,805 | |||||||||||||||
Average loans held for investment at amortized cost | $ | 789,167 | $ | 653,231 | $ | 764,213 | $ | 594,743 | |||||||||||||||
Nonperforming loans (including government guaranteed balances) | $ | 10,393 | $ | 10,267 | $ | 10,393 | $ | 10,267 | |||||||||||||||
Nonperforming loans (excluding government guaranteed balances) | $ | 8,776 | $ | 4,015 | $ | 8,776 | $ | 4,015 | |||||||||||||||
Guaranteed balance of government guaranteed loans | $ | 191,306 | $ | 160,397 | $ | 191,306 | $ | 160,397 | |||||||||||||||
Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | ||||||||||||||||||||||||||||||||||
(Dollars in thousands) | Net (Charge-off) Recovery | Average Loans HFI | Net (Charge-off) Recovery Ratio | Net (Charge-off) Recovery | Average Loans HFI | Net (Charge-off) Recovery Ratio | |||||||||||||||||||||||||||||
Residential real estate | $ | 8 | $ | 228,539 | 0.01 | % | $ | — | $ | 131,536 | — | % | |||||||||||||||||||||||
Commercial real estate | (33) | 326,051 | (0.04) | 49 | 276,226 | 0.07 | |||||||||||||||||||||||||||||
Commercial and industrial | (1,428) | 248,096 | (2.30) | (592) | 219,005 | (1.08) | |||||||||||||||||||||||||||||
Commercial and industrial - PPP | — | 15,418 | — | — | 28,102 | — | |||||||||||||||||||||||||||||
Consumer and other | (781) | 39,234 | (7.96) | (32) | 36,949 | (0.35) | |||||||||||||||||||||||||||||
Total loans held for investment | $ | (2,234) | $ | 857,338 | (1.04) | % | $ | (575) | $ | 691,818 | (0.33) | % |
Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | ||||||||||||||||||||||||||||||||||
(Dollars in thousands) | Net (Charge-off) Recovery | Average Loans HFI | Net (Charge-off) Recovery Ratio | Net (Charge-off) Recovery | Average Loans HFI | Net (Charge-off) Recovery Ratio | |||||||||||||||||||||||||||||
Residential real estate | $ | 8 | $ | 209,934 | 0.01 | % | $ | — | $ | 102,486 | — | % | |||||||||||||||||||||||
Commercial real estate | (31) | 299,972 | (0.01) | 57 | 246,341 | 0.03 | |||||||||||||||||||||||||||||
Commercial and industrial | (4,357) | 258,043 | (2.25) | (2,302) | 211,950 | (1.45) | |||||||||||||||||||||||||||||
Commercial and industrial - PPP | — | 17,337 | — | — | 40,566 | — | |||||||||||||||||||||||||||||
Consumer and other | (1,995) | 37,044 | (7.18) | (68) | 21,655 | (0.42) | |||||||||||||||||||||||||||||
Total loans held for investment | $ | (6,375) | $ | 822,330 | (1.03) | % | $ | (2,313) | $ | 622,998 | (0.50) | % |
(Dollars in thousands) | At and for the Nine Months Ended September 30, | |||||||||||||
Government Guaranteed, Excluding PPP | 2023 | 2022 | ||||||||||||
Number of loans originated | 1,968 | 825 | ||||||||||||
Amount of loans originated | $ | 402,528 | $ | 276,583 | ||||||||||
Average loan size originated | $ | 205 | $ | 335 | ||||||||||
Government guaranteed loan balances sold | $ | 316,333 | $ | 233,105 | ||||||||||
Government unguaranteed loan balances sold | $ | 10,937 | $ | 13,803 | ||||||||||
Total government guaranteed loans | $ | 373,719 | $ | 286,798 | ||||||||||
Government guaranteed loan balances | $ | 176,062 | $ | 138,261 | ||||||||||
Government unguaranteed loan balances | $ | 197,657 | $ | 148,537 | ||||||||||
Government guaranteed loans serviced for others | $ | 825,723 | $ | 616,419 |
September 30, | |||||||||||||||||||||||
2023 | 2022 | ||||||||||||||||||||||
(Dollars in thousands) | Amount | % of Total | Amount | % of Total | |||||||||||||||||||
Florida | $ | 131,928 | 35 | % | $ | 89,373 | 31 | % | |||||||||||||||
California | 45,121 | 12 | 31,930 | 11 | |||||||||||||||||||
Tennessee | 28,395 | 8 | 18,672 | 7 | |||||||||||||||||||
Texas | 23,710 | 6 | 21,478 | 7 | |||||||||||||||||||
All Other | 144,565 | 39 | 125,345 | 44 | |||||||||||||||||||
Total government guaranteed loans, excluding PPP loans | $ | 373,719 | 100 | % | $ | 286,798 | 100 | % |
(Dollars in thousands) | September 30, 2023 | December 31, 2022 | |||||||||||||||||||||
Noninterest-bearing deposits | $ | 98,008 | 9.6 | % | $ | 93,235 | 11.8 | % | |||||||||||||||
Interest-bearing transaction accounts | 267,404 | 26.3 | 202,656 | 25.5 | |||||||||||||||||||
Money market accounts | 333,250 | 32.7 | 345,200 | 43.4 | |||||||||||||||||||
Savings | 16,860 | 1.7 | 17,853 | 2.2 | |||||||||||||||||||
Subtotal | 715,522 | 70.3 | 658,944 | 82.9 | |||||||||||||||||||
Total time deposits | 302,274 | 29.7 | 136,126 | 17.1 | |||||||||||||||||||
Total deposits | $ | 1,017,796 | 100.0 | % | $ | 795,070 | 100.0 | % |
(Dollars in thousands) | |||||
Three months or less | $ | 27,073 | |||
Over three months through six months | 11,668 | ||||
Over six months through 12 months | 16,581 | ||||
Over 12 months | 61,480 | ||||
Total | $ | 116,802 |
Actual | Minimum(1) | Well Capitalized(2) | |||||||||||||||||||||||||||||||||
(Dollars in thousands) | Amount | Percent | Amount | Percent | Amount | Percent | |||||||||||||||||||||||||||||
As of September 30, 2023 | |||||||||||||||||||||||||||||||||||
Total Capital (to risk-weighted assets) | $ | 109,171 | 13.47 | % | $ | 64,858 | 8.00 | % | $ | 81,072 | 10.00 | % | |||||||||||||||||||||||
Tier 1 Capital (to risk-weighted assets) | 99,010 | 12.21 | 48,643 | 6.00 | 64,858 | 8.00 | |||||||||||||||||||||||||||||
Common Equity Tier 1 Capital (to risk-weighted assets) | 99,010 | 12.21 | 36,482 | 4.50 | 52,697 | 6.50 | |||||||||||||||||||||||||||||
Tier 1 Capital (to total assets) | 99,010 | 9.16 | 43,258 | 4.00 | 54,072 | 5.00 | |||||||||||||||||||||||||||||
As of December 31, 2022 | |||||||||||||||||||||||||||||||||||
Total Capital (to risk-weighted assets) | 108,307 | 15.00 | 57,767 | 8.00 | 72,209 | 10.00 | |||||||||||||||||||||||||||||
Tier 1 Capital (to risk-weighted assets) | 99,269 | 13.75 | 43,325 | 6.00 | 57,767 | 8.00 | |||||||||||||||||||||||||||||
Common Equity Tier 1 Capital (to risk-weighted assets) | 99,269 | 13.75 | 32,494 | 4.50 | 46,936 | 6.50 | |||||||||||||||||||||||||||||
Tier 1 Capital (to total assets) | 99,269 | 10.79 | 36,816 | 4.00 | 46,020 | 5.00 |
(Dollars in thousands) | September 30, 2023 | December 31, 2022 | |||||||||
Unfunded loan commitments | $ | 20,459 | $ | 23,512 | |||||||
Unused lines of credit | 169,634 | 134,366 | |||||||||
Standby letters of credit | 61 | 244 | |||||||||
Total | $ | 190,154 | $ | 158,122 |
Contractual Obligations as of September 30, 2023 | |||||||||||||||||||||||||||||
(Dollars in thousands) | Less than One Year | One to Three Years | Three to Five Years | Over Five Years | Total | ||||||||||||||||||||||||
Operating lease obligations | $ | 1,117 | $ | 1,951 | $ | 619 | $ | — | $ | 3,687 | |||||||||||||||||||
Short-term borrowings | — | — | — | — | — | ||||||||||||||||||||||||
Long-term borrowings | 456 | 912 | 912 | 223 | 2,503 | ||||||||||||||||||||||||
Subordinated notes | — | — | — | 5,947 | 5,947 | ||||||||||||||||||||||||
Time deposits | 160,251 | 141,497 | 526 | — | 302,274 | ||||||||||||||||||||||||
Total | $ | 161,824 | $ | 144,360 | $ | 2,057 | $ | 6,170 | $ | 314,411 | |||||||||||||||||||
Contractual Obligations as of December 31, 2022 | |||||||||||||||||||||||||||||
(Dollars in thousands) | Less than One Year | One to Three Years | Three to Five Years | Over Five Years | Total | ||||||||||||||||||||||||
Operating lease obligations | $ | 1,450 | $ | 2,267 | $ | 1,245 | $ | — | $ | 4,962 | |||||||||||||||||||
Short-term borrowings | 25,000 | — | — | — | 25,000 | ||||||||||||||||||||||||
Long-term borrowings | 456 | 912 | 912 | 564 | 2,844 | ||||||||||||||||||||||||
Subordinated notes | 50 | — | — | 5,942 | 5,992 | ||||||||||||||||||||||||
Time deposits | 120,240 | 15,587 | 299 | — | 136,126 | ||||||||||||||||||||||||
Total | $ | 146,740 | $ | 17,854 | $ | 1,544 | $ | 8,786 | $ | 174,924 |
September 30, 2023 | December 31, 2022 | ||||||||||||||||||||||
Change in rates | Following 12 months | Following 24 months | Following 12 months | Following 24 months | |||||||||||||||||||
+400 basis points | 16.6 | % | 15.0 | % | 11.0 | % | 11.9 | % | |||||||||||||||
+300 basis points | 13.8 | 13.6 | 9.4 | 10.5 | |||||||||||||||||||
+200 basis points | 8.5 | 8.5 | 5.4 | 6.1 | |||||||||||||||||||
+100 basis points | 3.2 | 3.4 | 1.3 | 1.8 | |||||||||||||||||||
-100 basis points | (4.8) | (4.8) | (3.8) | (4.4) | |||||||||||||||||||
-200 basis points | (9.6) | (5.4) | (8.3) | (9.5) |
Change in rates | September 30, 2023 | December 31, 2022 | |||||||||
+400 basis points | (3.2) | % | (12.7) | % | |||||||
+300 basis points | (1.8) | (9.5) | |||||||||
+200 basis points | (1.8) | (7.0) | |||||||||
+100 basis points | (1.9) | (4.3) | |||||||||
-100 basis points | (0.3) | 2.6 | |||||||||
-200 basis points | (1.2) | 5.0 |
Period | Number of Shares | Average Price Paid Per Share | Cumulative Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Approximate Dollar Value of Shares That May Yet be Purchased Under the Plans or Programs | ||||||||||||||||||||||
July 1-31, 2023 | — | $ | — | 750 | $ | 989,203 | ||||||||||||||||||||
August 1-31, 2023 | 150 | 13.50 | 900 | $ | 987,178 | |||||||||||||||||||||
September 1-30, 2023 | — | — | 900 | $ | 987,178 | |||||||||||||||||||||
Total | 150 | $ | 13.50 |
Exhibit Number | Exhibit Name | |||||||
3.1 | ||||||||
3.2 | ||||||||
3.3 | ||||||||
3.4 | ||||||||
4.1 | ||||||||
4.2 | ||||||||
4.3 | ||||||||
4.4 | ||||||||
31.1 | ||||||||
31.2 | ||||||||
32.1 | ||||||||
32.2 | ||||||||
101 | Financial information from the Company’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2023, formatted in iXBRL interactive data files pursuant to Rule 405 of Regulation S-T: (i) Consolidated Balance Sheets; (ii) Consolidated Statements of Income; (iii) Consolidated Statements of Comprehensive Income; (iv) Consolidated Statements of Shareholders’ Equity; (v) Consolidated Statements of Cash Flows; and (vi) Notes to the Consolidated Financial Statements – filed herewith. | |||||||
104 |
BAYFIRST FINANCIAL CORP. | ||||||||
Date: | November 13, 2023 | |||||||
By: | /s/ Anthony N. Leo | |||||||
Anthony N. Leo | ||||||||
Chief Executive Officer (principal executive officer) | ||||||||
Date: | November 13, 2023 | |||||||
By: | /s/ Scott J. McKim | |||||||
Scott J. McKim | ||||||||
Chief Financial Officer (principal financial officer) |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 1,923 | $ (1,402) | $ 4,047 | $ (1,671) |
Net unrealized gains (losses) on investment securities available for sale | (516) | (1,628) | 139 | (4,530) |
Deferred income tax (expense) benefit | 134 | 422 | (36) | 1,170 |
Other comprehensive income (loss), net | (382) | (1,206) | 103 | (3,360) |
Comprehensive income (loss) | $ 1,541 | $ (2,608) | $ 4,150 | $ (5,031) |
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (UNAUDITED) (Parenthetical) - $ / shares |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Statement of Stockholders' Equity [Abstract] | ||||
Dividend declared on common stock (in dollars per share) | $ 0.08 | $ 0.08 | $ 0.24 | $ 0.24 |
BASIS OF PRESENTATION |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
BASIS OF PRESENTATION | BASIS OF PRESENTATION The accompanying unaudited consolidated financial statements include BayFirst Financial Corp. and its wholly owned subsidiary, BayFirst National Bank, together referred to as “the Company”. These unaudited consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles followed within the financial services industry for interim financial information and Article 8 of Regulation S-X. Accordingly, they do not include all of the information or notes required for complete financial statements. The consolidated balance sheet as of December 31, 2022 has been derived from the audited consolidated financial statements of BayFirst Financial Corp. for that period. The Company currently operates one business segment. In the third quarter of 2022, the Company discontinued the Bank’s nationwide residential mortgage loan segment. The operations of this segment are reported as discontinued operations. In the opinion of management, all adjustments, consisting of normal and recurring items, considered necessary for a fair presentation of the consolidated financial statements for the interim periods have been included. All significant intercompany accounts and transactions have been eliminated in consolidation. Certain amounts reported in prior periods have been reclassified to conform to current year presentation. These reclassifications did not have a material effect on previously reported net income, shareholders’ equity, or cash flows. Operating results for the nine month period ended September 30, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023. These statements should be read in conjunction with the consolidated financial statements and notes thereto for the year ended December 31, 2022. The Company’s significant accounting policies are described in Note 1 of the Notes to Consolidated Financial Statements for the year ended December 31, 2022 in the Company’s Annual Report filed on Form 10-K as well as changes to accounting policies which are described below. For interim reporting purposes, the Company follows the same basic accounting policies and considers each interim period as an integral part of an annual period. Use of Estimates: To prepare financial statements in conformity with GAAP, management makes estimates and assumptions based on available information. These estimates and assumptions affect the amounts reported in the financial statements and the disclosures provided, and actual results could differ. The most significant estimates relate to the ACL, government guaranteed loan servicing rights, and fair value of government guaranteed loans. Emerging Growth Company Status: The Company is expected to remain an "emerging growth company," as defined in the JOBS Act, through December 31, 2026. Section 107 of the JOBS Act provides that an emerging growth company can take advantage of an extended transition period when complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. The Company has elected to take advantage of this extended transition period, which means these financial statements, as well as financial statements they file in the future for as long as the Company remains an emerging growth company, will be subject to all new or revised accounting standards generally applicable to private companies. Contingencies: Due to the nature of their activities, the Company and its subsidiary are at times engaged in various legal proceedings that arise in the course of normal business, some of which were outstanding as of September 30, 2023. Although the ultimate outcome of all claims and lawsuits outstanding as of September 30, 2023 cannot be ascertained at this time, it is the opinion of management that these matters, when resolved, will not have a material adverse effect on the Company’s results of operations or financial condition. Adoption of New Accounting Standards: On January 1, 2023, the Company adopted ASU No. 2016-13 “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”) along with its amendments, which replaces the incurred loss impairment methodology in past standards with the CECL methodology and requires consideration of a broader range of information to determine credit loss estimates. The measurement of expected losses under the CECL methodology is applicable to financial assets measured at amortized cost, as well as unfunded commitments that are considered off-balance sheet credit exposures at the reporting date. The measurement is based on historical experience, current conditions, and reasonable and supportable forecasts and requires enhanced disclosures related to the significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of an organization’s portfolio. In addition, ASU 2016-13 amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. One such change is to require credit losses to be presented as an allowance rather than as a write-down on available-for-sale debt securities management does not intend to sell. The Company adopted ASC 326 using the modified retrospective method for all financial assets measured at amortized cost and off-balance sheet credit exposures. Results for reporting periods beginning January 1, 2023 and after are presented under ASC 326, while prior period amounts continue to be reported in accordance with previously applicable GAAP. The Company recorded a decrease to retained earnings of $2,508, net of tax, comprised of a $3,107 pretax increase in the ACL for loans and $18 for HTM securities combined with a $213 pretax increase in reserve on unfunded commitments, as of January 1, 2023 for the cumulative effect of adopting ASC 326. The pre-tax impact of the January 1, 2023 adoption is summarized in the table below:
ASU 2022-02, “Financial Instruments - Credit Losses (Topic 326)” (“ASU 2022-02”) eliminates the guidance on troubled debt restructurings and requires entities to evaluate all loan modifications to determine if they result in a new loan or a continuation of the existing loan. ASU 2022-02 also requires that entities disclose current-period gross charge-offs by year of origination for loans. The amendments in this Update became effective for the Company on January 1, 2023 for all interim and annual periods. The adoption of the provisions in this Update are applied prospectively and have resulted in additional disclosures concerning modifications of loans to borrowers experiencing financial difficulty, as well as disaggregated disclosure of charge-offs on loans. Please also see Note 5 – Allowance for Credit Losses for added disclosure concerning modifications of loans to borrowers experiencing financial difficulty, as well as current period gross charge-offs on financing receivables by year of origination and class of financing receivable. Allowance for Credit Losses - Investment Securities: The ACL on held-to-maturity securities is a contra-asset valuation determined in accordance with ASC 326, which is deducted from the securities' amortized cost basis at the balance sheet date as a result of management's assessment of the net amount expected to be collected. The allowance is measured on a pooled basis for securities with similar risk characteristics using historical credit loss information, adjusted for current conditions and reasonable and supportable forecasts. Securities that are determined to be uncollectible are written off against the allowance. For available-for-sale securities in an unrealized loss position ("impaired security"), we assess whether 1) we intend to sell the security, or, 2) it is more likely than not that we will be required to sell the security before recovery of its amortized cost basis. Under either of these scenarios above, the security's amortized cost is written down to fair value through a charge to previously recognized allowances or earnings, as applicable. For impaired securities that do not meet these conditions, we assess whether the decline in fair value was due to credit loss or other factors. This assessment considers, among other things: 1) the extent to which the fair value is less than amortized cost, 2) the financial condition and near-term prospects of the issuer, 3) any changes to the rating of the security by a rating agency, and 4) our intent and ability to retain the investment for a period of time sufficient to allow for any anticipated recovery in fair value. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an ACL is recorded for the credit loss component. Any impairment due to non-credit-related factors that has not been recorded through an ACL is recognized in other comprehensive income (loss). The discount rate used in determining the present value of the expected cash flows is based on the effective interest rate implicit in the security at the date of purchase. The ACL on investment securities HTM is a contra-asset valuation that is deducted from the carrying amount of investment securities HTM to present the net amount expected to be collected. Investment securities HTM are charged off against the ACL when deemed uncollectible. Adjustments to the ACL are reported in our Consolidated Statements of Income in provision for credit losses. We measure expected credit losses on securities HTM on a collective basis by major security type with each type sharing similar risk characteristics, and consider historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts. With regard to U.S. Government-sponsored agency and mortgage-backed securities, all these investment securities are issued by a U.S.government-sponsored entity and have an implicit or explicit government guarantee; therefore, no ACL has been recorded for these investment securities. With regard to corporate bonds HTM, we consider the issuer’s bond rating or the average expected default frequency of the similar investment securities based on company size and industry for those investment securities that are not rated. Historical loss rates associated with investment securities having similar grades as those in our portfolio have been insignificant. Accrued interest receivable is excluded from the amortized costs and fair values of both held-to-maturity and available-for-sale securities and included in accrued interest receivable on the Consolidated Balance Sheets. Investment securities are placed on non-accrual status when principal or interest is contractually past due more than ninety days, or management does not expect full payment of principal and interest. We do not record an ACL for accrued interest receivable on investment securities, as the amounts are written-off when the investment is placed on non-accrual status. There were no non-accrual investment securities in any of the periods presented in the consolidated financial statements. Allowance for Credit Losses - Loans Held for Investment and Unfunded Commitments: The ACL is a valuation account that is deducted from the amortized cost basis of loans to present a net amount expected to be collected. The ACL excludes loans held for sale and loans accounted for under the fair value option. Loans are charged-off against the ACL when management believes the uncollectibility of a loan balance is confirmed. The Company’s ACL on loans is estimated using relevant information, from internal and external sources, relating to past events, current conditions, and reasonable and supportable forecasts. The Company’s historical credit loss experience provides the basis for the estimation of expected credit losses. Management adjusts historical loss information for differences in current risk characteristics such as portfolio risk grading, delinquency levels, or portfolio mix as well as for changes in environmental conditions such as changes in unemployment rates. The ACL on unfunded loan commitments is based on estimates of probability that these commitments will be drawn upon according to historical utilization experience, expected loss severity and loss rates as determined for pooled funded loans. The ACL on unfunded commitments is a liability account included in other liabilities. Management estimates these allowances quarterly. The ACL is measured on a pooled basis when similar risk characteristics are present in the portfolio. The Company has identified portfolio segments based on loan pools with similar credit risk characteristics, which generally correspond to federal regulatory reporting codes, with separate consideration for the government guaranteed loans. The ACL model utilizes a PD/LGD methodology to measure the expected credit losses on government guaranteed loans and a WARM methodology for the remaining loans. The PD/LGD method estimates losses by utilizing estimated PD, LGD, and individual loan level exposure at default. The WARM model contemplates expected losses at a pool-level, utilizing historical loss information. Portions of government guaranteed loans have a government guarantee for credit losses, therefore, no ACL has been recorded for those loan balances. In order to quantify the credit risk impact of other trends and changes within the loan portfolio, the Company utilizes qualitative adjustments to the modeled estimated loss approaches. These qualitative adjustments include: changes in lending policies, procedures, and strategies; changes in nature and volume of portfolio; staff experience; changes in volume and trends in classified loans, delinquencies, and nonaccrual; concentration risk; trends in underlying collateral value; external factors such as competition, legal, regulatory; changes in quality of the loan review system; and economic conditions. Additionally, the Company uses reasonable and supportable forecasts utilizing data from the Federal Open Market Committee’s median forecasts of change in national GDP and of national unemployment. Loans that do not share risk characteristics are evaluated on an individual basis and are excluded from the pooled evaluation. This generally occurs when, based on current information and events, it is probable that the Company will be unable to collect all interest and principal payments due according to the originally contracted, or reasonably modified, terms of the loan agreement. Individually evaluated loans are evaluated for impairment and a portion of the allowance is allocated so that the loan is reported, net, at the present value of estimated future cash flows using the rate implicit in the original loan agreement or at the fair value of collateral if repayment is expected solely from the collateral. Expected credit losses are estimated over the contractual term of the loan, adjusted for expected prepayments when appropriate. The contractual term excludes expected extensions, renewals, and modifications unless management has a reasonable expectation at the reporting date that a modification will be executed with an individual borrower or the extension or renewal options are included in the contract at the reporting date by the Company. Past due status of loans is determined based on contractual terms. Commercial and residential loans are placed in nonaccrual status and interest accrual is discontinued if they become 90 days delinquent or there is evidence that the borrower’s ability to make the required payments is impaired. Other consumer and personal loans continue to accrue interest and are typically charged off no later than 120 days past due. When interest accrual is discontinued, all unpaid accrued interest is reversed unless all or some interest accrued to date is guaranteed by the USDA, in which case the guaranteed amount is not reversed. Management has made the accounting policy election to exclude accrued interest receivable on loans from the estimate of credit losses. The determination of the appropriate level of the ACL inherently involves a high degree of subjectivity and requires the Company to make significant estimates of current credit risks and future trends, all of which may undergo material changes. Although management believes that the processes in place for assessing the appropriate level of the ACL are robust, such policies and procedures have limitations, including judgment errors in management’s risk analysis, and may not prevent unexpected losses in the future. Moreover, the CECL methodology may create more volatility in the level of our ACL from quarter to quarter as changes in the level of ACL will be dependent upon, among other things, macroeconomic forecasts and conditions, loan portfolio volumes and credit quality. These factors could have a material adverse effect on the Company’s business, financial condition and results of operations. Preferred Stock Offering: On September 30, 2023, the Company issued 1,835 shares of 11.0% Series C Cumulative Convertible Preferred Stock through a private offering. These shares have no par value and a liquidation preference of $1 per share plus an amount equal to all accumulated dividends thereon (whether or not declared but without interest) to the date payment of such distribution is made in full. Total gross proceeds from the preferred stock offering were $1,835 through September 30, 2023 which will be used for operating expenses or to contribute capital to BayFirst National Bank to support its growth and operations. An additional 1,995 shares and 1,760 shares were issued on October 18, 2023 and October 31, 2023, respectively. Total gross proceeds from the preferred stock offering currently totals $5,590. Series C Preferred Shareholders are entitled to receive quarterly cash dividends at 11% per annum (unless the Company has not redeemed the shares by the tenth anniversary of their issuance, in which event the rate is subject to be increased to 12%). The holders of shares of Series C Preferred Stock have the right to convert such shares into shares of common stock at a conversion value equal to the quotient of: (i) the $1 liquidation preference; divided by (ii) the tangible book value per share of common stock, calculated on the basis of the Company’s financial statements, as of the last day of the calendar quarter occurring prior to the date on which a holder exercises the conversion right; provided, however, that tangible book value shall be adjusted to reflect a subsequent quarter end only on the last day of the month succeeding such quarter end. On the tenth anniversary of the issuance of any Series C Preferred Stock, the Company must redeem such shares; provided, however, that the Company will not be so obligated if it does not have adequate funds to pay the redemption price or is prohibited by law or otherwise from redeeming the shares. The Company may redeem any portion of the outstanding shares of Series C Preferred Stock at any time after the third anniversary of their issuance. The redemption price in either instance will be $1 per share plus an amount equal to all accumulated dividends thereon (whether or not earned or declared but without interest) to the date of payment of such distribution.
|
DISCONTINUED OPERATIONS |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Discontinued Operations and Disposal Groups [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DISCONTINUED OPERATIONS | DISCONTINUED OPERATIONS During the third quarter of 2022, the Company discontinued the Bank’s nationwide residential mortgage loan production operations. The decision was based on a number of strategic priorities and other factors, including the precipitous decline in mortgage volumes and the uncertain outlook for mortgage lending over future periods. As a result of these actions, the Company classified the operations of the residential mortgage lending division as discontinued under ASC 205-20. The Consolidated Balance Sheets, Consolidated Statements of Income, and Consolidated Statements of Cash Flows present discontinued operations for the current period and retrospectively for prior periods. The following is a summary of the assets and liabilities of the discontinued operations of the residential mortgage lending division at September 30, 2023 and December 31, 2022:
The following presents operating results of the discontinued operations of the residential mortgage lending division for the three and nine months ended September 30, 2023 and September 30, 2022:
|
INVESTMENT SECURITIES |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVESTMENT SECURITIES | INVESTMENT SECURITIES The amortized costs, gross unrealized gains and losses, and estimated fair values of investment securities available for sale and investment securities held to maturity at September 30, 2023 and December 31, 2022 as well as the ACL for investment securities held to maturity at September 30, 2023 are summarized as follows:
The amortized cost and fair value of investment securities as of September 30, 2023 are shown in the table below by contractual maturity. Actual timing may differ from contractual maturities if borrowers have the right to call or prepay obligations with or without call or prepayment penalties.
No ACL for investment securities AFS was needed at September 30, 2023. Accrued interest receivable on securities AFS is excluded from the estimate of credit losses and is included in accrued interest receivable in the Consolidated Balance Sheets. As of September 30, 2023, there were no past due principal and interest payments associated with the HTM securities. There was an ACL of $19 on corporate bonds HTM based on applying the long-term historical credit loss rate for similarly rated securities. The following table presents the activity in the ACL for investment securities HTM by major security type for the three and nine months ended September 30, 2023:
The following table summarizes investment securities with unrealized losses at September 30, 2023 aggregated by security type and length of time in a continuous unrealized loss position:
The following table summarizes investment securities with unrealized losses at December 31, 2022 aggregated by security type and length of time in a continuous unrealized loss position:
No investment securities were pledged as of September 30, 2023 or December 31, 2022, and there were no sales of investment securities during the three and nine months ended September 30, 2023 or during the year ended December 31, 2022.
|
LOANS |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LOANS | LOANS Loans held for investment, at amortized cost, at September 30, 2023 and December 31, 2022 were as follows:
(1) The Company allocates the retained portion of loans sold based on relative fair value of the retained portion and the sold portion, which results in a discount on the retained portion.
|
ALLOWANCE FOR CREDIT LOSSES |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ALLOWANCE FOR CREDIT LOSSES | ALLOWANCE FOR CREDIT LOSSES On January 1, 2023, the Company adopted ASU 2016-13, or CECL, using the modified retrospective method for all of its loans measured at amortized cost. With the adoption of CECL, the Company elected to exclude accrued interest receivable from the amortized cost basis of loans. The following schedules present the activity in the ACL by loan segment for the three and nine months ended September 30, 2023 and September 30, 2022:
On January 1, 2023 the Company adopted CECL which significantly changed the credit losses estimation model for loans. The ACL represents management’s best estimate of future lifetime expected losses on its held for investment loan portfolio. The Company calculates its ACL by estimating expected credit losses on a collective basis for loans that share similar risk characteristics. Loans that do not share similar risk characteristics with other loans are evaluated for credit losses on an individual basis. The Company uses a combination of modeled and non-modeled approaches that incorporates current and future economic conditions to estimate lifetime expected losses on a collective basis. The Company’s ACL model utilizes a PD/LGD methodology to measure the expected credit losses on government guaranteed loans and a WARM methodology for the remaining loans. The PD/LGD method estimates losses by utilizing estimated PD, LGD, and individual loan level exposure at default. The WARM model contemplates expected losses at a pool-level, utilizing historical loss information. Portions of government guaranteed loans have a government guarantee for credit losses, therefore, no ACL has been recorded for those loan balances. In order to quantify the credit risk impact of other trends and changes within the loan portfolio, the Company utilizes qualitative adjustments to the modeled estimated loss approaches. These qualitative adjustments include: changes in lending policies, procedures, and strategies; changes in nature and volume of portfolio; staff experience; changes in volume and trends in classified loans, delinquencies, and nonaccrual; concentration risk; trends in underlying collateral value; external factors such as competition, legal, regulatory; changes in quality of the loan review system; and economic conditions. In addition to this, the Company uses reasonable and supportable forecasts utilizing data from the Federal Open Market Committee’s median forecasts of change in national GDP and of national unemployment. The FOMC’s forecast for the remainder of the calendar year is used in conjunction with the most recent 4 quarters of historical data from FRED (Federal Reserve Economic Data) to determine changes in certain qualitative factors used in calculating loss rates. Loans that do not share risk characteristics are evaluated on an individual basis and are excluded from the pooled evaluation. This generally occurs when, based on current information and events, it is probable that the Company will be unable to collect all interest and principal payments due according to the originally contracted, or reasonably modified, terms of the loan agreement. Individually evaluated loans are evaluated for impairment and a portion of the allowance is allocated so that the loan is reported, net, at the present value of estimated future cash flows using the rate implicit in the original loan agreement or at the fair value of collateral if repayment is expected solely from the collateral. See Note 1 of the Notes to Consolidated Financial Statements for further discussion of the Company’s ACL methodology. The Company maintains a separate ACL for its off-balance sheet unfunded loan commitments. The ACL on unfunded loan commitments is based on estimates of probability that these commitments will be drawn upon according to historical utilization experience, expected loss severity and loss rates as determined for pooled funded loans. As of September 30, 2023 and December 31, 2022, the ACL for unfunded commitments recorded in other liabilities was $844 and $511, respectively. The following tables present the recorded investment in nonaccrual loans and loans past due over 89 days still on accrual by loan segment at September 30, 2023 and December 31, 2022. In the following tables, the recorded investment does not include the government guaranteed balance.
A financial asset is considered collateral dependent when the debtor is experiencing financial difficulty and repayment is expected to be provided substantially through the sale or operation of the collateral. Expected credit losses for collateral dependent loans are based on the fair value of the collateral at the reporting date, adjusted for selling costs as appropriate. Significant quarter over quarter changes are reflective of changes in nonaccrual status and not necessarily associated with credit quality indicators like appraised value. The following table presents the amortized cost basis of individually analyzed collateral dependent loans by loan portfolio segment as of September 30, 2023:
The following table presents the aging of the recorded investment in past due gross loans HFI at amortized cost at September 30, 2023 by loan segment:
The following table presents the aging of the recorded investment in past due gross loans HFI at amortized cost at December 31, 2022 by loan segment:
Modifications to Borrowers Experiencing Financial Difficulty For the three and nine months ended September 30, 2023, there were no loan modifications to borrowers experiencing financial difficulty and no loan modifications that subsequently defaulted during the period. Troubled Debt Restructurings At December 31, 2022, the Company had no loans classified as a troubled debt restructuring. See Note 1 for additional discussion on TDRs. Credit Quality Indicators Internal risk-rating grades are assigned to loans by lending, credit administration or loan review personnel, based on an analysis of the financial and collateral strength and other credit attributes underlying each loan. Management analyzes the resulting ratings, as well as other statistics and factors such as delinquency, to track the migration performance of the portfolio balances. This analysis is performed at least annually. The Bank uses the following definitions for its risk ratings: Pass – Loans properly approved, documented, collateralized, and performing which do not reflect an abnormal credit risk. Special Mention – These credits have potential weaknesses that may, if not checked or corrected, weaken the asset, or inadequately protect the Company’s position at some future date. These assets pose elevated risk, but their weakness does not yet justify a “Substandard” classification. Substandard – These loans are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected. Doubtful – These loans have all the weaknesses inherent in those classified as Substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently known facts, conditions, and values, highly questionable and improbable. The table below sets forth credit exposure for the commercial loan portfolio disaggregated by loan segment based on internally assigned risk ratings at September 30, 2023 and gross write offs for the nine months then ended September 30, 2023:
The Company considers the performance of the loan portfolio to determine its impact on the ACL. For residential and consumer loan classes, the Company evaluates credit quality based on the aging status of the loan by payment activity. The following table presents the amortized costs at September 30, 2023 in residential and consumer loans based on payment activity as well as gross write offs for the nine months then ended September 30, 2023.
The table below sets forth credit exposure for the loan portfolio disaggregated by loan segment based on internally assigned risk ratings at December 31, 2022:
Prior to the adoption of ASC 326 on January 1, 2023, the Company calculated the ALLL using incurred losses methodology. The following tables are disclosures related to loans in prior periods. The following table presents the balance in the ALLL and the recorded investment in loans by loan segment and based on impairment method at December 31, 2022. The government guaranteed loan balances are included in the collectively evaluated for impairment balances.
For purposes of the impaired loans by loan segment table above, the unpaid principal balance and recorded investment do not include the government guaranteed balance. The government guaranteed balances of impaired loans at December 31, 2022 were $6,797. The following table presents information related to impaired loans by loan segment at and for the nine months ended September 30, 2022:
|
FAIR VALUE |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FAIR VALUE | FAIR VALUE Fair value is the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There are three levels of inputs that may be used to measure fair values: Level 1 – Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access at the measurement date. Level 2 – Significant other observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, and other inputs that are observable or can be corroborated by observable market data. Level 3 – Significant unobservable inputs that reflect a Company’s own assumptions about the assumptions that market participants would use in pricing an asset or liability. A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The following is a description of the valuation methodologies used for instruments measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy. Investment Securities Available for Sale: The fair values of investment securities available for sale are determined by matrix pricing, which is a mathematical technique used to value debt securities without relying exclusively on quoted prices for the specific investment securities, but rather by relying on the investment securities’ relationship to other benchmark quoted investment securities (Level 2). Management obtains the fair values of investment securities available for sale on a monthly basis from a third party pricing service. Residential Loans Held for Sale: The Company had elected to account for residential loans held for sale at fair value. The fair value of loans held for sale was determined using either actual quoted prices for the assets (Level 1) whenever possible or quoted prices for similar assets, adjusted for specific attributes of that loan (Level 2). The fair value gain (loss) on loans held for sale is included in discontinued operations in the Consolidated Statements of Income. Government Guaranteed Loans Held for Investment, at Fair Value: The Company has elected to account for certain government guaranteed loans held for investment at fair value. Fair value is calculated based on the present value of estimated future payments (Level 3). The valuation model uses interest rate, prepayment speed, and default rate assumptions that market participants would use in estimating future payments. Whenever available, the present value is validated against available market data. Mortgage Banking Derivatives: Mortgage banking derivatives used in the ordinary course of business primarily consisted of best efforts forward sales contracts. The fair value of best efforts forward sales contracts was measured using market observable inputs that were adjusted using unobservable inputs including duration, spread, and pull-through rates (Level 3). Individually Evaluated Loans: Periodically, the Company records non-recurring adjustments to the carrying value of loans based on fair value measurements for partial charge-offs of the uncollectible portions of those loans. Non-recurring adjustments can also include certain impairment amounts for collateral-dependent loans calculated when establishing the ACL. Loans are considered collateral dependent when the Company has determined that foreclosure of the collateral is probable or when a borrower is experiencing financial difficulty and the loan is expected to be repaid substantially through the operation or sale of collateral. A collateral dependent loan’s ACL is measured based on the difference between the fair value of the collateral and the amortized cost basis of the loan as of the measurement date. Fair value of the loan’s collateral is determined by appraisals, independent valuation, or management’s estimation of fair value which is then adjusted for the cost related to liquidation of the collateral. Collateral dependent loans are generally classified as Level 3 based on management’s judgment and estimation. Government Guaranteed Loan Servicing Rights: The fair value of government guaranteed servicing rights is based on a valuation model that calculates the present value of estimated net servicing income. The valuation model incorporates assumptions that market participants would use in estimating future net servicing income. There were no government guaranteed loan servicing rights carried at fair value at September 30, 2023 and December 31, 2022. On a quarterly basis, government guaranteed loan servicing rights are evaluated for impairment based upon the fair value of the rights as compared to the cost. If the carrying amount exceeds fair value, impairment is recorded so that the servicing asset is carried at fair value. Assets measured at fair value on a recurring basis at September 30, 2023 are summarized below. There were no liabilities carried at fair value on a recurring basis at September 30, 2023.
Assets measured at fair value on a recurring basis at December 31, 2022 are summarized below. There were no liabilities carried at fair value on a recurring basis at December 31, 2022.
(1) Classified as assets from discontinued operations or liabilities from discontinued operations on the consolidated balance sheet. There were no transfers between levels for assets and liabilities recorded at fair value on a recurring basis during the reported periods. Financial Instruments Recorded Using Fair Value Option The Company has elected the fair value option for residential loans held for sale. These loans are intended for sale and are classified as assets from discontinued operations on the consolidated balance sheet. The Company believes that the fair value is the best indicator of the resolution of these loans. Interest income from discontinued operations is recorded based on the contractual term of the loan and in accordance with the Company’s policy on loans held for investment. There were no residential loans held for sale as of September 30, 2023. None of the loans were 90 days or more past due or on nonaccrual at December 31, 2022. The aggregate fair value, contractual balance, and gain at December 31, 2022 for residential loans held for sale from discontinued operations were as follows:
The total amount of interest income from discontinued operations and losses from changes in fair value included in earnings for the nine months ended September 30, 2023 and September 30, 2022 for residential loans held for sale from discontinued operations were as follows:
The Company also elected the fair value option for certain of its government guaranteed loans held for investment as the Company believed that fair value was the best indicator of the resolution of those loans at that time. Depending on market conditions and liquidity needs of the Company, management determines whether it is advantageous to hold or sell government guaranteed loans on a loan-by-loan basis. The portion of these loans guaranteed by the government are generally readily marketable in the secondary market and the portion of the loans that are not guaranteed may be sold periodically to other third party financial institutions. Interest income on these loans is recorded based on the contractual term of the loan and in accordance with the Company’s policy on other loans held for investment. The aggregate fair value, contractual balance, and gain at September 30, 2023 and December 31, 2022 for government guaranteed loans held for investment, at fair value, were as follows:
The total amount of gains and losses from changes in fair value and interest income included in earnings for the nine months ended September 30, 2023 and September 30, 2022 for government guaranteed loans held for investment, at fair value, were as follows:
Changes in fair value for government guaranteed loans held for investment, at fair value, were included in Government guaranteed loans fair value gain on the Consolidated Statements of Income. The table below presents a reconciliation of government guaranteed loans held for investment, at fair value, which were valued on a recurring basis and used significant unobservable inputs (Level 3) for the nine months ended September 30, 2023 and September 30, 2022:
The Company’s valuation of government guaranteed loans held for investment, at fair value, was supported by an analysis prepared by an independent third party and approved by management. The approach to determine fair value involved several steps: 1) identifying each loan’s unique characteristics, including balance, payment type, term, coupon, age, and principal and interest payment; 2) projecting these loan level characteristics for the life of each loan; and 3) performing discounted cash flow modeling. The following table provides information about the valuation techniques and unobservable inputs used in the valuation of government guaranteed loans held for investment, at fair value, interest rate lock commitments, and best efforts forward sales contracts falling within Level 3 of the fair value hierarchy at September 30, 2023 and December 31, 2022:
The significant unobservable inputs impacting the fair value measurement of government guaranteed loans held for investment, at fair value, include discount rates and conditional prepayment rates. Increases in discount rates or prepayment rates would result in a lower fair value measurement. Although the prepayment rate and discount rate are not directly interrelated, they generally move in opposite directions. The discount rates and conditional prepayment rates were weighted by the relative principal balance outstanding of these loans. Assets measured at fair value on a nonrecurring basis at September 30, 2023 are summarized below:
Assets measured at fair value on a nonrecurring basis at December 31, 2022 are summarized below:
Fair Value of Financial Instruments The carrying values and estimated fair values of financial instruments not carried at fair value, at September 30, 2023 and December 31, 2022 are as follows:
(1) Includes balances of $2 classified as assets from discontinued operations on the consolidated balance sheet as of December 31, 2022. (2) Classified as assets from discontinued operations on the consolidated balance sheet.
|
GOVERNMENT GUARANTEED LOAN SERVICING ACTIVITIES |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Transfers and Servicing [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
GOVERNMENT GUARANTEED LOAN SERVICING ACTIVITIES | GOVERNMENT GUARANTEED LOAN SERVICING ACTIVITIESAt September 30, 2023 and December 31, 2022, the principal balance of government guaranteed loans, excluding PPP loans, retained by the Company was $373,719 and $300,219, respectively, of which $176,062 and $139,587 represented the guaranteed portion of the loans. Loans serviced for others are not included in the accompanying Consolidated Balance Sheets. The unpaid principal balances of government guaranteed loans serviced for others requiring recognition of a servicing asset were $825,723 and $660,600 at September 30, 2023 and December 31, 2022, respectively. Activity for government guaranteed loan servicing rights for the three and nine months ended September 30, 2023 and September 30, 2022 follows:
The fair value of government guaranteed loan servicing rights was $15,339 and $13,051 at September 30, 2023 and December 31, 2022, respectively. Fair value was determined using a weighted average discount rate of 15.25% and a weighted average prepayment speed of 10.71% at September 30, 2023. Fair value was determined using a weighted average discount rate of 14.88% and a weighted average prepayment speed of 9.93% at December 31, 2022. The government guaranteed loan servicing rights are amortized over the life of a loan on a loan-by-loan basis. The following table presents the components of net gain on sale of government guaranteed loans, excluding sale of PPP loans, for the three and nine months ended September 30, 2023 and September 30, 2022:
|
PREMISES AND EQUIPMENT |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PREMISES AND EQUIPMENT | PREMISES AND EQUIPMENT Premises and equipment at September 30, 2023 and December 31, 2022 were as follows:
(1)There were no premises and equipment assets classified as assets from discontinued operations as of September 30, 2023 or December 31, 2022. Depreciation and amortization expense including expense from discontinued operations was $616 and $509 for the three months ended September 30, 2023 and September 30, 2022, respectively, and $1,744 and $1,505 for the nine months ended September 30, 2023 and September 30, 2022, respectively.
|
LEASES |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LEASES | LEASES For the three and nine months ended September 30, 2023 and September 30, 2022, the components of total lease cost and supplemental information related to operating leases were as follows:
(1) Includes lease costs reported as discontinued operations of $44 and $232 for the three months ended September 30, 2023 and September 30, 2022, respectively, and $131 and $847 for the nine months ended September 30, 2023 and September 30, 2022, respectively.
At September 30, 2023, the weighted average discount rate of operating leases was 2.34% and the weighted average remaining life of operating leases was 3.35 years. The future minimum lease payments for operating leases, subsequent to September 30, 2023, as recorded on the balance sheet, are summarized as follows:
Impairment of ROU Assets ROU assets from operating leases are subject to the impairment guidance in ASC 360, Property, Plant, and Equipment, and are reviewed for impairment when indicators of impairment are present. ASC 360 requires three steps to identify, recognize and measure impairment. If indicators of impairment are present (Step 1), the Company performs a recoverability test (Step 2) comparing the sum of the estimated undiscounted cash flows attributable to the ROU asset in question to the carrying amount. The Company estimates the fair value of the ROU asset and recognizes an impairment loss when the carrying amount exceeds the estimated fair value (Step 3). During 2022, the Company closed leased mortgage lending offices as part of its discontinuance of the nationwide residential lending operation. The mortgage lending offices were evaluated as outlined above to determine whether the operating leases were impaired. As part of the recoverability test, the Company elected to exclude operating lease liabilities from the carrying amount of the asset group. The undiscounted future cash flows used in the recoverability test were based on assumptions made by the Company rather than market participant assumptions. Since an election was made to exclude operating lease liabilities from the asset or asset group, all future cash lease payments for the lease were also excluded. In addition, the Company elected to exclude operating lease liabilities from the estimated fair value, consistent with the recoverability test. When determining the fair value of the ROU asset, the Company estimated what market participants would pay to lease the assets assuming the highest and best use in the assets’ current forms.Based on the analysis, the Company concluded that the ROU assets for these offices were impaired and had a remaining ROU carrying value of $398 as of September 30, 2023. The analyses resulted in no additional impairment for the nine months ended September 30, 2023.
|
OTHER BORROWINGS |
9 Months Ended |
---|---|
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
OTHER BORROWINGS | OTHER BORROWINGS At September 30, 2023, the Company had no borrowings from the FHLB and FRB. There were $25,000 of borrowings at 4.50% from the FRB and no borrowings from the FHLB at December 31, 2022. The Bank is a member of the FHLB of Atlanta, which provides short- and long-term funding collateralized by mortgage-related assets to its members. FHLB short-term borrowings bear interest at variable rates set by the FHLB. Any advances that the bank were to obtain would be secured by a blanket lien on $274,900 of real estate-related loans as of September 30, 2023. Based on this collateral and the Company's holdings of FHLB stock, the Company was eligible to borrow up to $156,472 from the FHLB at September 30, 2023. In addition, the Bank has a secured line of credit with the Federal Reserve Bank of Atlanta which was secured by $59,636 of commercial loans as of September 30, 2023. FRB short-term borrowings bear interest at variable rates based on the Federal Open Market Committee's target range for the federal funds rate. Based on this collateral, the Company was eligible to borrow up to $40,089 from the FRB at September 30, 2023. In June 2021, the Company issued $6,000 of Subordinated Debentures (the “Debentures”) that mature June 30, 2031 and are redeemable after 5 years. The Debentures carry interest at a fixed rate of 4.50% per annum for the initial 5 years of term and carry interest at a floating rate for the final 5 years of term. Under the debt agreements, the floating rates are based on a SOFR benchmark plus 3.78% per annum. The balance of Subordinated Debentures outstanding at the Company, net of offering costs, amounted to $5,947 and $5,992 at September 30, 2023 and December 31, 2022, respectively. The Company has a term note with quarterly principal and interest payments with interest at Prime (8.50% at September 30, 2023). The note matures on March 10, 2029 and the balance of the note was $2,503 and $2,844 at September 30, 2023 and December 31, 2022, respectively. The note is secured by 100% of the stock of the Bank and requires the Company to comply with certain loan covenants during the term of the note. As of September 30, 2023, the Company was in compliance with all financial debt covenants.
|
STOCK-BASED COMPENSATION |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-Based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
STOCK-BASED COMPENSATION | STOCK-BASED COMPENSATION The Equity Plan governs the Company’s restricted stock grants and stock options. Total compensation cost charged against income related to the Equity Plan was $167 and $186 for the three months ended September 30, 2023 and September 30, 2022, respectively, and $486 and $609 for the nine months ended September 30, 2023 and September 30, 2022, respectively. Restricted Stock The Company awarded shares of restricted common stock to certain employees and non-employee directors for which compensation expense is recognized ratably over the vesting period of the awards based on the fair value of the stock at issue date. A summary of changes in the Company’s nonvested restricted shares for the nine months ended September 30, 2023 follows:
At September 30, 2023, there was $598 of total unrecognized compensation cost related to nonvested restricted shares granted under the Equity Plan that is expected to be recognized over a weighted average period of 2.9 years. The total fair value of shares vested during the nine months ended September 30, 2023 and September 30, 2022 was $252 and $177, respectively. Stock Options The Equity Plan permits the grant of stock options to the Company’s employees and non-employee directors for up to 15% of the total number of shares of Company common stock issued and outstanding, up to 1,500,000 shares. Option awards are granted with an exercise price equal to the market price of the Company’s common stock at the date of grant. The market price of the Company’s common stock is the closing sales price of the Common Stock on Nasdaq on the date of the grant. Those option awards generally have a vesting period of 5 years for employees and 3 years for non-employee directors and have 10-year contractual terms. The fair value of each option award is estimated on the date of grant using a closed form option valuation (Black-Scholes) model that uses the assumptions noted in the table below. Expected volatility is based on an average of historical volatility of peer financial institutions. The expected term of options granted represents the period of time that options granted are expected to be outstanding, which takes into account that the options are not transferable. The risk-free interest rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of grant. A summary of the activity in the Equity Plan for the nine months ended September 30, 2023 follows:
There were no options granted during the three and nine months ended September 30, 2023 or September 30, 2022. Total unrecognized compensation cost related to nonvested stock options granted under the Equity Plan was $81 at September 30, 2023. This cost is expected to be recognized over a weighted average period of 1.58 years.
|
OTHER BENEFIT PLANS |
9 Months Ended |
---|---|
Sep. 30, 2023 | |
Postemployment Benefits [Abstract] | |
OTHER BENEFIT PLANS | OTHER BENEFIT PLANSThe Company has established a stock dividend reinvestment and stock purchase plan. Under the DRIP, eligible shareholders can voluntarily purchase stock with their dividend or can make additional stock purchases. During the nine months ended September 30, 2023, 10,589 shares were purchased at an average price of $14.98. During the nine months ended September 30, 2022, 9,776 shares were purchased at an average price of $17.07. All employees and Directors are eligible to participate in the NSPP. Expense recognized in relation to the NSPP for the nine months ended September 30, 2023 and September 30, 2022 was $20 and $78, respectively. The Company has a Salary Continuation Agreement (the “Agreement”) with an executive officer. In accordance with the Agreement, the executive will receive an annual benefit of $25 for twenty years following separation of service. The liability recorded for the Agreement was $347 and $336 at September 30, 2023 and December 31, 2022, respectively, and the related expense for the nine months ended September 30, 2023 and September 30, 2022 was $11 and $57, respectively. Payments are expected to begin in 2024 upon retirement of the CEO on December 31, 2023. The Company has a 401(k) plan that covers all employees subject to certain age and service requirements. The Company contributes 3% of each employee’s salary each pay period as a safe harbor contribution. The Company may also match employee contributions each year at the discretion of the Board of Directors. Expense recognized in relation to the 401(k) plan was $678 and $1,333 for the nine months ended September 30, 2023 and September 30, 2022, respectively. The discontinuation of the nationwide residential lending division during 2022 triggered a partial plan termination and all affected employees were 100% vested in the Company’s contributions into the plan. The Company has an ESOP for eligible employees. Each year, the Company’s Board of Directors may approve a discretionary percentage of employees’ salaries to be contributed to the ESOP for eligible employees. In 2021, the ESOP trust acquired 14,154 shares of the Company’s stock. As this is a leveraged plan, unallocated shares are distributed to employees annually. There were 11,323 unallocated shares with a fair value of $127 remaining as of September 30, 2023. The ESOP trust’s outstanding loan, which is secured by the unallocated shares, bears a fixed interest rate equal to Prime Rate as of the note date, which was 3.25%. The note requires an annual payment of principal and interest through December 2026. The Company’s ESOP, which is internally leveraged, does not report the loan receivable extended to the ESOP as an asset and does not report the ESOP debt due to the Company. The discontinuation of the nationwide residential lending division during 2022 triggered a partial plan termination and all affected employees were 100% vested in the Company’s contributions into the ESOP. As a result of the exit of affected participants from the plan, the plan acquired 23,383 shares of the Company’s stock. As this is a leveraged plan, unallocated shares are distributed to employees annually. There were 23,383 unallocated shares with a fair value of $263 remaining as of September 30, 2023. The ESOP trust was issued a five year loan bearing an interest rate equal to Prime Rate as of the note date, which was 8.25% and adjusts annually as of the first day of each succeeding calendar year to reflect the Prime Rate as of the first business day of the calendar year. The note requires an annual payment of principal and interest through December 2027. The Company’s ESOP, which is internally leveraged, does not report the loan receivable extended to the ESOP as an asset and does not report the ESOP debt due to the Company. The Board did not approve any contributions in 2022 and has not approved any in 2023. There was no expense related to the ESOP for the nine months ended September 30, 2023 and September 30, 2022.
|
INCOME TAXES |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INCOME TAXES | INCOME TAXESThe Company and its subsidiaries are subject to U.S. federal income tax. In the ordinary course of business, they are routinely subject to audit by the Internal Revenue Service. Currently, the Company is subject to examination by taxing authorities for the 2020 tax return year and forward. A reconciliation of expected income tax expense (benefit) using the federal statutory rate of 21% for the three and nine months ended September 30, 2023 and September 30, 2022 and actual income tax expense (benefit) is as follows:
|
REGULATORY MATTERS |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Banking And Thrift Disclsoure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
REGULATORY MATTERS | REGULATORY MATTERS Banks and bank holding companies are subject to regulatory capital requirements administered by federal banking agencies. Capital adequacy guidelines and, additionally for banks, prompt corrective action regulations, involve quantitative measures of assets, liabilities, and certain off-balance sheet items calculated under regulatory accounting practices. Capital amounts and classifications are also subject to qualitative judgments by regulators. Failure to meet capital requirements can initiate regulatory action. Management believes that the Bank met all capital adequacy requirements to which it was subject at September 30, 2023 and December 31, 2022. Prompt corrective action regulations provide five classifications: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized, and critically undercapitalized, although these terms are not used to represent overall financial condition. If adequately capitalized, regulatory approval is required to accept brokered deposits. If undercapitalized, capital distributions are limited, as is asset growth and expansion, and capital restoration plans are required. At September 30, 2023 and December 31, 2022, the most recent regulatory notifications categorized the Bank as well capitalized under the regulatory framework for prompt corrective action. There are no conditions or events since that notification that management believes have changed the institution’s classification. In February 2019, the federal bank regulatory agencies issued a final rule that revised certain capital regulations under ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, and included a transition option that allows banking organizations to phase in, over a three year period, the day one adverse effects of adoption on their regulatory capital ratios (three year transition option). In connection with the adoption of ASC 326 on January 1, 2021, the Company recognized an after-tax cumulative effect reduction to retained earnings. The Company elected to adopt the three year transition option and the deferral has been applied in capital ratios presented below. Actual and required capital amounts and ratios for the Bank are presented below at September 30, 2023:
Actual and required capital amounts and ratios for the Bank are presented below at December 31, 2022:
Dividend Restrictions Banking regulations limit the amount of dividends that may be paid. Approval by regulatory authorities is required if the effect of dividends declared would cause the regulatory capital of the Bank to fall below specified minimum levels. Approval is also required if dividends declared exceed the net profits of the Bank for that year combined with the retained net profits for the preceding two years.
|
MORTGAGE BANKING ACTIVITIES - DISCONTINUED OPERATIONS |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Mortgage Banking [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
MORTGAGE BANKING ACTIVITIES - DISCONTINUED OPERATIONS | MORTGAGE BANKING ACTIVITIES - DISCONTINUED OPERATIONS The following table presents the components of the residential loan fee income from discontinued operations for the three and nine months ended September 30, 2023 and September 30, 2022:
Prior to the discontinuance of the nationwide mortgage operations, the Company entered into interest rate lock commitments, which were commitments to originate loans where the interest rate on the loan was determined prior to funding and the clients had locked into that interest rate. The Company then locked in the loan and interest rate with an investor and committed to deliver the loan if settlement occurred (“best efforts”) or committed to deliver the locked loan in a binding (“mandatory”) delivery program with an investor. It was the Company’s practice to enter into forward commitments for the future delivery of residential mortgage loans when interest rate lock commitments were entered into in order to economically hedge the effect of changes in interest rates resulting from its commitments to fund the loans. Interest rate lock commitments and mandatory commitments to deliver loans to investors were considered derivatives. There were no mortgage banking derivatives outstanding as of September 30, 2023. The following table reflects the amount and fair value of mortgage banking derivatives included in the assets and liabilities from discontinued operations on the Consolidated Balance Sheets at December 31, 2022:
|
LOAN COMMITMENTS AND OTHER RELATED ACTIVITIES |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LOAN COMMITMENTS AND OTHER RELATED ACTIVITIES | LOAN COMMITMENTS AND OTHER RELATED ACTIVITIES Some financial instruments, such as loan commitments, credit lines, and letters of credit, are issued to meet customer financing needs. These are agreements to provide credit or to support the credit of others, as long as conditions established in the contract are met, and usually have expiration dates. Commitments may expire without being used. Off-balance sheet risk to credit loss exists up to the face amount of these instruments, although material losses are not anticipated. The same credit policies that are used for loans are used to make such commitments, including obtaining collateral at exercise of the commitment. The contractual amounts of financial instruments with off-balance sheet risk at September 30, 2023 and December 31, 2022 were as follows:
All unused lines of credit at September 30, 2023 and December 31, 2022 were variable rate lines of credit and the majority of unfunded loan commitments at September 30, 2023 and December 31, 2022 were commitments to fund variable rate loans. Unfunded loan commitments are generally entered into for periods of 90 days or less. The Company maintains an ACL for its off-balance sheet loan commitments which is calculated by loan type using estimated line utilization rates based on historical usage. Loss rates for outstanding loans is applied to the estimated utilization rates to calculate the ACL for off-balance sheet loan commitments. At September 30, 2023 and December 31, 2022, ACL for off-balance sheet loan commitments totaled $844 and $511, respectively.
|
EARNINGS PER COMMON SHARE |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
EARNINGS PER COMMON SHARE | EARNINGS PER COMMON SHARE The following table sets forth the computation of basic and diluted earnings per common share for the three and nine months ended September 30, 2023 and September 30, 2022:
The following securities outstanding at September 30, 2023 and September 30, 2022 have been excluded from the calculation of weighted average shares outstanding as their effect on the calculation of earnings (loss) per share is antidilutive:
|
BASIS OF PRESENTATION (Policies) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basis of Presentation | The accompanying unaudited consolidated financial statements include BayFirst Financial Corp. and its wholly owned subsidiary, BayFirst National Bank, together referred to as “the Company”. These unaudited consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles followed within the financial services industry for interim financial information and Article 8 of Regulation S-X. Accordingly, they do not include all of the information or notes required for complete financial statements. The consolidated balance sheet as of December 31, 2022 has been derived from the audited consolidated financial statements of BayFirst Financial Corp. for that period.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting | The Company currently operates one business segment. In the third quarter of 2022, the Company discontinued the Bank’s nationwide residential mortgage loan segment. The operations of this segment are reported as discontinued operations. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Use of Estimates | Use of Estimates: To prepare financial statements in conformity with GAAP, management makes estimates and assumptions based on available information. These estimates and assumptions affect the amounts reported in the financial statements and the disclosures provided, and actual results could differ. The most significant estimates relate to the ACL, government guaranteed loan servicing rights, and fair value of government guaranteed loans. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Contingencies | Contingencies: Due to the nature of their activities, the Company and its subsidiary are at times engaged in various legal proceedings that arise in the course of normal business, some of which were outstanding as of September 30, 2023. Although the ultimate outcome of all claims and lawsuits outstanding as of September 30, 2023 cannot be ascertained at this time, it is the opinion of management that these matters, when resolved, will not have a material adverse effect on the Company’s results of operations or financial condition. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Adoption on New Accounting Standards | Adoption of New Accounting Standards: On January 1, 2023, the Company adopted ASU No. 2016-13 “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”) along with its amendments, which replaces the incurred loss impairment methodology in past standards with the CECL methodology and requires consideration of a broader range of information to determine credit loss estimates. The measurement of expected losses under the CECL methodology is applicable to financial assets measured at amortized cost, as well as unfunded commitments that are considered off-balance sheet credit exposures at the reporting date. The measurement is based on historical experience, current conditions, and reasonable and supportable forecasts and requires enhanced disclosures related to the significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of an organization’s portfolio. In addition, ASU 2016-13 amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. One such change is to require credit losses to be presented as an allowance rather than as a write-down on available-for-sale debt securities management does not intend to sell. The Company adopted ASC 326 using the modified retrospective method for all financial assets measured at amortized cost and off-balance sheet credit exposures. Results for reporting periods beginning January 1, 2023 and after are presented under ASC 326, while prior period amounts continue to be reported in accordance with previously applicable GAAP. The Company recorded a decrease to retained earnings of $2,508, net of tax, comprised of a $3,107 pretax increase in the ACL for loans and $18 for HTM securities combined with a $213 pretax increase in reserve on unfunded commitments, as of January 1, 2023 for the cumulative effect of adopting ASC 326. The pre-tax impact of the January 1, 2023 adoption is summarized in the table below:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Allowance for Credit Losses-Investment Securities | Allowance for Credit Losses - Investment Securities: The ACL on held-to-maturity securities is a contra-asset valuation determined in accordance with ASC 326, which is deducted from the securities' amortized cost basis at the balance sheet date as a result of management's assessment of the net amount expected to be collected. The allowance is measured on a pooled basis for securities with similar risk characteristics using historical credit loss information, adjusted for current conditions and reasonable and supportable forecasts. Securities that are determined to be uncollectible are written off against the allowance. For available-for-sale securities in an unrealized loss position ("impaired security"), we assess whether 1) we intend to sell the security, or, 2) it is more likely than not that we will be required to sell the security before recovery of its amortized cost basis. Under either of these scenarios above, the security's amortized cost is written down to fair value through a charge to previously recognized allowances or earnings, as applicable. For impaired securities that do not meet these conditions, we assess whether the decline in fair value was due to credit loss or other factors. This assessment considers, among other things: 1) the extent to which the fair value is less than amortized cost, 2) the financial condition and near-term prospects of the issuer, 3) any changes to the rating of the security by a rating agency, and 4) our intent and ability to retain the investment for a period of time sufficient to allow for any anticipated recovery in fair value. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an ACL is recorded for the credit loss component. Any impairment due to non-credit-related factors that has not been recorded through an ACL is recognized in other comprehensive income (loss). The discount rate used in determining the present value of the expected cash flows is based on the effective interest rate implicit in the security at the date of purchase. The ACL on investment securities HTM is a contra-asset valuation that is deducted from the carrying amount of investment securities HTM to present the net amount expected to be collected. Investment securities HTM are charged off against the ACL when deemed uncollectible. Adjustments to the ACL are reported in our Consolidated Statements of Income in provision for credit losses. We measure expected credit losses on securities HTM on a collective basis by major security type with each type sharing similar risk characteristics, and consider historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts. With regard to U.S. Government-sponsored agency and mortgage-backed securities, all these investment securities are issued by a U.S.government-sponsored entity and have an implicit or explicit government guarantee; therefore, no ACL has been recorded for these investment securities. With regard to corporate bonds HTM, we consider the issuer’s bond rating or the average expected default frequency of the similar investment securities based on company size and industry for those investment securities that are not rated. Historical loss rates associated with investment securities having similar grades as those in our portfolio have been insignificant. Accrued interest receivable is excluded from the amortized costs and fair values of both held-to-maturity and available-for-sale securities and included in accrued interest receivable on the Consolidated Balance Sheets. Investment securities are placed on non-accrual status when principal or interest is contractually past due more than ninety days, or management does not expect full payment of principal and interest. We do not record an ACL for accrued interest receivable on investment securities, as the amounts are written-off when the investment is placed on non-accrual status. There were no non-accrual investment securities in any of the periods presented in the consolidated financial statements.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Allowance for Credit Losses - Loans Held for Investment and Unfunded Commitments | Allowance for Credit Losses - Loans Held for Investment and Unfunded Commitments: The ACL is a valuation account that is deducted from the amortized cost basis of loans to present a net amount expected to be collected. The ACL excludes loans held for sale and loans accounted for under the fair value option. Loans are charged-off against the ACL when management believes the uncollectibility of a loan balance is confirmed. The Company’s ACL on loans is estimated using relevant information, from internal and external sources, relating to past events, current conditions, and reasonable and supportable forecasts. The Company’s historical credit loss experience provides the basis for the estimation of expected credit losses. Management adjusts historical loss information for differences in current risk characteristics such as portfolio risk grading, delinquency levels, or portfolio mix as well as for changes in environmental conditions such as changes in unemployment rates. The ACL on unfunded loan commitments is based on estimates of probability that these commitments will be drawn upon according to historical utilization experience, expected loss severity and loss rates as determined for pooled funded loans. The ACL on unfunded commitments is a liability account included in other liabilities. Management estimates these allowances quarterly. The ACL is measured on a pooled basis when similar risk characteristics are present in the portfolio. The Company has identified portfolio segments based on loan pools with similar credit risk characteristics, which generally correspond to federal regulatory reporting codes, with separate consideration for the government guaranteed loans. The ACL model utilizes a PD/LGD methodology to measure the expected credit losses on government guaranteed loans and a WARM methodology for the remaining loans. The PD/LGD method estimates losses by utilizing estimated PD, LGD, and individual loan level exposure at default. The WARM model contemplates expected losses at a pool-level, utilizing historical loss information. Portions of government guaranteed loans have a government guarantee for credit losses, therefore, no ACL has been recorded for those loan balances. In order to quantify the credit risk impact of other trends and changes within the loan portfolio, the Company utilizes qualitative adjustments to the modeled estimated loss approaches. These qualitative adjustments include: changes in lending policies, procedures, and strategies; changes in nature and volume of portfolio; staff experience; changes in volume and trends in classified loans, delinquencies, and nonaccrual; concentration risk; trends in underlying collateral value; external factors such as competition, legal, regulatory; changes in quality of the loan review system; and economic conditions. Additionally, the Company uses reasonable and supportable forecasts utilizing data from the Federal Open Market Committee’s median forecasts of change in national GDP and of national unemployment. Loans that do not share risk characteristics are evaluated on an individual basis and are excluded from the pooled evaluation. This generally occurs when, based on current information and events, it is probable that the Company will be unable to collect all interest and principal payments due according to the originally contracted, or reasonably modified, terms of the loan agreement. Individually evaluated loans are evaluated for impairment and a portion of the allowance is allocated so that the loan is reported, net, at the present value of estimated future cash flows using the rate implicit in the original loan agreement or at the fair value of collateral if repayment is expected solely from the collateral. Expected credit losses are estimated over the contractual term of the loan, adjusted for expected prepayments when appropriate. The contractual term excludes expected extensions, renewals, and modifications unless management has a reasonable expectation at the reporting date that a modification will be executed with an individual borrower or the extension or renewal options are included in the contract at the reporting date by the Company. Past due status of loans is determined based on contractual terms. Commercial and residential loans are placed in nonaccrual status and interest accrual is discontinued if they become 90 days delinquent or there is evidence that the borrower’s ability to make the required payments is impaired. Other consumer and personal loans continue to accrue interest and are typically charged off no later than 120 days past due. When interest accrual is discontinued, all unpaid accrued interest is reversed unless all or some interest accrued to date is guaranteed by the USDA, in which case the guaranteed amount is not reversed. Management has made the accounting policy election to exclude accrued interest receivable on loans from the estimate of credit losses. The determination of the appropriate level of the ACL inherently involves a high degree of subjectivity and requires the Company to make significant estimates of current credit risks and future trends, all of which may undergo material changes. Although management believes that the processes in place for assessing the appropriate level of the ACL are robust, such policies and procedures have limitations, including judgment errors in management’s risk analysis, and may not prevent unexpected losses in the future. Moreover, the CECL methodology may create more volatility in the level of our ACL from quarter to quarter as changes in the level of ACL will be dependent upon, among other things, macroeconomic forecasts and conditions, loan portfolio volumes and credit quality. These factors could have a material adverse effect on the Company’s business, financial condition and results of operations.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value | Fair value is the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There are three levels of inputs that may be used to measure fair values: Level 1 – Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access at the measurement date. Level 2 – Significant other observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, and other inputs that are observable or can be corroborated by observable market data. Level 3 – Significant unobservable inputs that reflect a Company’s own assumptions about the assumptions that market participants would use in pricing an asset or liability. A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The following is a description of the valuation methodologies used for instruments measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy. Investment Securities Available for Sale: The fair values of investment securities available for sale are determined by matrix pricing, which is a mathematical technique used to value debt securities without relying exclusively on quoted prices for the specific investment securities, but rather by relying on the investment securities’ relationship to other benchmark quoted investment securities (Level 2). Management obtains the fair values of investment securities available for sale on a monthly basis from a third party pricing service. Residential Loans Held for Sale: The Company had elected to account for residential loans held for sale at fair value. The fair value of loans held for sale was determined using either actual quoted prices for the assets (Level 1) whenever possible or quoted prices for similar assets, adjusted for specific attributes of that loan (Level 2). The fair value gain (loss) on loans held for sale is included in discontinued operations in the Consolidated Statements of Income. Government Guaranteed Loans Held for Investment, at Fair Value: The Company has elected to account for certain government guaranteed loans held for investment at fair value. Fair value is calculated based on the present value of estimated future payments (Level 3). The valuation model uses interest rate, prepayment speed, and default rate assumptions that market participants would use in estimating future payments. Whenever available, the present value is validated against available market data. Mortgage Banking Derivatives: Mortgage banking derivatives used in the ordinary course of business primarily consisted of best efforts forward sales contracts. The fair value of best efforts forward sales contracts was measured using market observable inputs that were adjusted using unobservable inputs including duration, spread, and pull-through rates (Level 3). Individually Evaluated Loans: Periodically, the Company records non-recurring adjustments to the carrying value of loans based on fair value measurements for partial charge-offs of the uncollectible portions of those loans. Non-recurring adjustments can also include certain impairment amounts for collateral-dependent loans calculated when establishing the ACL. Loans are considered collateral dependent when the Company has determined that foreclosure of the collateral is probable or when a borrower is experiencing financial difficulty and the loan is expected to be repaid substantially through the operation or sale of collateral. A collateral dependent loan’s ACL is measured based on the difference between the fair value of the collateral and the amortized cost basis of the loan as of the measurement date. Fair value of the loan’s collateral is determined by appraisals, independent valuation, or management’s estimation of fair value which is then adjusted for the cost related to liquidation of the collateral. Collateral dependent loans are generally classified as Level 3 based on management’s judgment and estimation. Government Guaranteed Loan Servicing Rights: The fair value of government guaranteed servicing rights is based on a valuation model that calculates the present value of estimated net servicing income. The valuation model incorporates assumptions that market participants would use in estimating future net servicing income. There were no government guaranteed loan servicing rights carried at fair value at September 30, 2023 and December 31, 2022. On a quarterly basis, government guaranteed loan servicing rights are evaluated for impairment based upon the fair value of the rights as compared to the cost. If the carrying amount exceeds fair value, impairment is recorded so that the servicing asset is carried at fair value.
|
BASIS OF PRESENTATION (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Impact of Adoption | The pre-tax impact of the January 1, 2023 adoption is summarized in the table below:
|
DISCONTINUED OPERATIONS (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Discontinued Operations and Disposal Groups [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Discontinued Operations of the Residential Mortgage Lending Division | The following is a summary of the assets and liabilities of the discontinued operations of the residential mortgage lending division at September 30, 2023 and December 31, 2022:
The following presents operating results of the discontinued operations of the residential mortgage lending division for the three and nine months ended September 30, 2023 and September 30, 2022:
|
INVESTMENT SECURITIES (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Securities Available for Sale | The amortized costs, gross unrealized gains and losses, and estimated fair values of investment securities available for sale and investment securities held to maturity at September 30, 2023 and December 31, 2022 as well as the ACL for investment securities held to maturity at September 30, 2023 are summarized as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Securities Held to Maturity | The amortized costs, gross unrealized gains and losses, and estimated fair values of investment securities available for sale and investment securities held to maturity at September 30, 2023 and December 31, 2022 as well as the ACL for investment securities held to maturity at September 30, 2023 are summarized as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Investments Classified by Contractual Maturity | The amortized cost and fair value of investment securities as of September 30, 2023 are shown in the table below by contractual maturity. Actual timing may differ from contractual maturities if borrowers have the right to call or prepay obligations with or without call or prepayment penalties.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Allowance for Credit Losses for Investment Securities | The following table presents the activity in the ACL for investment securities HTM by major security type for the three and nine months ended September 30, 2023:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Investment Securities With Unrealized Losses | The following table summarizes investment securities with unrealized losses at September 30, 2023 aggregated by security type and length of time in a continuous unrealized loss position:
The following table summarizes investment securities with unrealized losses at December 31, 2022 aggregated by security type and length of time in a continuous unrealized loss position:
|
LOANS (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Loans Held for Investment at Amortized Cost | Loans held for investment, at amortized cost, at September 30, 2023 and December 31, 2022 were as follows:
(1) The Company allocates the retained portion of loans sold based on relative fair value of the retained portion and the sold portion, which results in a discount on the retained portion.
|
ALLOWANCE FOR CREDIT LOSSES (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Allowance for Credit Losses by Loan Segment, for Unfunded Commitments and Recorded Investment in Loans by Loan Segment | The following schedules present the activity in the ACL by loan segment for the three and nine months ended September 30, 2023 and September 30, 2022:
The following table presents the balance in the ALLL and the recorded investment in loans by loan segment and based on impairment method at December 31, 2022. The government guaranteed loan balances are included in the collectively evaluated for impairment balances.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Allowance for Credit Loss on Unfunded Commitments | The following table presents the activity in the ACL for unfunded commitments for the three and nine months ended September 30, 2023:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Recorded Investment in Nonaccrual and Loans Past Due over 89 Days Still on Accrual by Loan Segment | The following tables present the recorded investment in nonaccrual loans and loans past due over 89 days still on accrual by loan segment at September 30, 2023 and December 31, 2022. In the following tables, the recorded investment does not include the government guaranteed balance.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Credit Exposure for the Loan Portfolio Disaggregated by Loan Segment | The following table presents the amortized cost basis of individually analyzed collateral dependent loans by loan portfolio segment as of September 30, 2023:
The table below sets forth credit exposure for the commercial loan portfolio disaggregated by loan segment based on internally assigned risk ratings at September 30, 2023 and gross write offs for the nine months then ended September 30, 2023:
The Company considers the performance of the loan portfolio to determine its impact on the ACL. For residential and consumer loan classes, the Company evaluates credit quality based on the aging status of the loan by payment activity. The following table presents the amortized costs at September 30, 2023 in residential and consumer loans based on payment activity as well as gross write offs for the nine months then ended September 30, 2023.
The table below sets forth credit exposure for the loan portfolio disaggregated by loan segment based on internally assigned risk ratings at December 31, 2022:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Aging of Recorded Investment in Past Due Gross Loans at Amortized Cost | The following table presents the aging of the recorded investment in past due gross loans HFI at amortized cost at September 30, 2023 by loan segment:
The following table presents the aging of the recorded investment in past due gross loans HFI at amortized cost at December 31, 2022 by loan segment:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Information Related to Impaired Loans by Loan Segment | The following table presents information related to impaired loans by loan segment at and for the nine months ended September 30, 2022:
|
FAIR VALUE (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis | Assets measured at fair value on a recurring basis at September 30, 2023 are summarized below. There were no liabilities carried at fair value on a recurring basis at September 30, 2023.
Assets measured at fair value on a recurring basis at December 31, 2022 are summarized below. There were no liabilities carried at fair value on a recurring basis at December 31, 2022.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value for Loans | The aggregate fair value, contractual balance, and gain at December 31, 2022 for residential loans held for sale from discontinued operations were as follows:
The total amount of interest income from discontinued operations and losses from changes in fair value included in earnings for the nine months ended September 30, 2023 and September 30, 2022 for residential loans held for sale from discontinued operations were as follows:
The aggregate fair value, contractual balance, and gain at September 30, 2023 and December 31, 2022 for government guaranteed loans held for investment, at fair value, were as follows:
The total amount of gains and losses from changes in fair value and interest income included in earnings for the nine months ended September 30, 2023 and September 30, 2022 for government guaranteed loans held for investment, at fair value, were as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Valuation Technique and Unobservable Inputs Used in the Valuation of Government Guaranteed Loans Held for Investment, at Fair Value | The table below presents a reconciliation of government guaranteed loans held for investment, at fair value, which were valued on a recurring basis and used significant unobservable inputs (Level 3) for the nine months ended September 30, 2023 and September 30, 2022:
The following table provides information about the valuation techniques and unobservable inputs used in the valuation of government guaranteed loans held for investment, at fair value, interest rate lock commitments, and best efforts forward sales contracts falling within Level 3 of the fair value hierarchy at September 30, 2023 and December 31, 2022:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Assets Measured at Fair Value on a Nonrecurring Basis | Assets measured at fair value on a nonrecurring basis at September 30, 2023 are summarized below:
Assets measured at fair value on a nonrecurring basis at December 31, 2022 are summarized below:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of the Carrying Values and Estimated Values of Financial Instruments Not Carried at Fair Value | The carrying values and estimated fair values of financial instruments not carried at fair value, at September 30, 2023 and December 31, 2022 are as follows:
(1) Includes balances of $2 classified as assets from discontinued operations on the consolidated balance sheet as of December 31, 2022. (2) Classified as assets from discontinued operations on the consolidated balance sheet.
|
GOVERNMENT GUARANTEED LOAN SERVICING ACTIVITIES (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Transfers and Servicing [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Activity for Government Guaranteed Loan Servicing Rights | Activity for government guaranteed loan servicing rights for the three and nine months ended September 30, 2023 and September 30, 2022 follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Net Gain on Sale of Government Guaranteed Loans | The following table presents the components of net gain on sale of government guaranteed loans, excluding sale of PPP loans, for the three and nine months ended September 30, 2023 and September 30, 2022:
|
PREMISES AND EQUIPMENT (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Premises and Equipment | Premises and equipment at September 30, 2023 and December 31, 2022 were as follows:
(1)There were no premises and equipment assets classified as assets from discontinued operations as of September 30, 2023 or December 31, 2022.
|
LEASES (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Total Lease Cost and Supplemental Information | For the three and nine months ended September 30, 2023 and September 30, 2022, the components of total lease cost and supplemental information related to operating leases were as follows:
(1) Includes lease costs reported as discontinued operations of $44 and $232 for the three months ended September 30, 2023 and September 30, 2022, respectively, and $131 and $847 for the nine months ended September 30, 2023 and September 30, 2022, respectively.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Future Minimum Lease Payments | The future minimum lease payments for operating leases, subsequent to September 30, 2023, as recorded on the balance sheet, are summarized as follows:
|
STOCK-BASED COMPENSATION (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-Based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Nonvested Restricted Shares | A summary of changes in the Company’s nonvested restricted shares for the nine months ended September 30, 2023 follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Activity in the Equity Plan | A summary of the activity in the Equity Plan for the nine months ended September 30, 2023 follows:
|
INCOME TAXES (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Reconciliation of Expected Income Tax Expense (Benefit) using the Federal Statutory Rate | A reconciliation of expected income tax expense (benefit) using the federal statutory rate of 21% for the three and nine months ended September 30, 2023 and September 30, 2022 and actual income tax expense (benefit) is as follows:
|
REGULATORY MATTERS (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Banking And Thrift Disclsoure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Actual and Required Capital Amounts and Ratios for the Bank | Actual and required capital amounts and ratios for the Bank are presented below at September 30, 2023:
Actual and required capital amounts and ratios for the Bank are presented below at December 31, 2022:
|
MORTGAGE BANKING ACTIVITIES - DISCONTINUED OPERATIONS (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Mortgage Banking [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Components of Residential Loan Fee Income From Discontinued Operations | The following table presents the components of the residential loan fee income from discontinued operations for the three and nine months ended September 30, 2023 and September 30, 2022:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value of Mortgage Banking Derivative Assets | The following table reflects the amount and fair value of mortgage banking derivatives included in the assets and liabilities from discontinued operations on the Consolidated Balance Sheets at December 31, 2022:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value of Mortgage Banking Derivative Liabilities | The following table reflects the amount and fair value of mortgage banking derivatives included in the assets and liabilities from discontinued operations on the Consolidated Balance Sheets at December 31, 2022:
|
LOAN COMMITMENTS AND OTHER RELATED ACTIVITIES (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Financial Instruments With Off-Balance Sheet Risk | The contractual amounts of financial instruments with off-balance sheet risk at September 30, 2023 and December 31, 2022 were as follows:
|
EARNINGS PER COMMON SHARE (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Basic and Diluted Earnings Per Common Share | The following table sets forth the computation of basic and diluted earnings per common share for the three and nine months ended September 30, 2023 and September 30, 2022:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Antidilutive Securities Excluded from Calculation of Weighted Average Shares Outstanding | The following securities outstanding at September 30, 2023 and September 30, 2022 have been excluded from the calculation of weighted average shares outstanding as their effect on the calculation of earnings (loss) per share is antidilutive:
|
DISCONTINUED OPERATIONS - Assets and Liabilities of the Residential Mortgage Lending Division (Details) - USD ($) $ in Thousands |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Assets | ||
Total assets | $ 398 | $ 1,211 |
Liabilities | ||
Total liabilities | 715 | 1,658 |
Discontinued Operations, Held-for-sale | Nationwide Residential Mortgage Loan Production Operations | ||
Assets | ||
Loans held for sale, at fair value | 0 | 449 |
Loan servicing rights | 0 | 201 |
Right-of-use operating lease asset | 398 | 559 |
Accrued interest receivable | 0 | 2 |
Total assets | 398 | 1,211 |
Liabilities | ||
Operating lease liability | 715 | 1,189 |
Other liabilities | 0 | 469 |
Total liabilities | $ 715 | $ 1,658 |
INVESTMENT SECURITIES - Investments Classified by Contractual Maturity (Details) - USD ($) $ in Thousands |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Amortized Cost | ||
One to five years | $ 11,333 | |
Five to ten years | 0 | |
Beyond ten years | 33,236 | |
Amortized cost | 44,569 | $ 47,374 |
Fair Value | ||
One to five years | 11,335 | |
Five to ten years | 0 | |
Beyond ten years | 28,348 | |
Total | 39,683 | 42,349 |
Amortized Cost | ||
One to five years | 1,500 | |
Five to ten years | 1,000 | |
Beyond ten years | 1 | |
Amortized cost | 2,501 | 5,002 |
Fair Value | ||
One to five years | 1,384 | |
Five to ten years | 897 | |
Beyond ten years | 1 | |
Total | $ 2,282 | $ 4,755 |
INVESTMENT SECURITIES - Narrative (Details) - USD ($) $ in Thousands |
Sep. 30, 2023 |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|---|
Investments, Debt and Equity Securities [Abstract] | |||
Allowance for credit loss | $ 19 | $ 19 | $ 0 |
INVESTMENT SECURITIES - Allowance for Credit Losses for Investment Securities (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended |
---|---|---|
Sep. 30, 2023 |
Sep. 30, 2023 |
|
Debt Securities, Held-to-Maturity, Excluding Accrued Interest, Allowance for Credit Loss [Roll Forward] | ||
Beginning Balance | $ 19 | $ 0 |
Provision for credit losses | 0 | 1 |
Investment securities charge-offs/recoveries | 0 | 0 |
Investment securities recoveries | 0 | 0 |
Ending Balance | 19 | 19 |
Impact of adopting ASC 326 | ||
Debt Securities, Held-to-Maturity, Excluding Accrued Interest, Allowance for Credit Loss [Roll Forward] | ||
Beginning Balance | $ 0 | $ 18 |
ALLOWANCE FOR CREDIT LOSSES - Narrative (Details) - USD ($) $ in Thousands |
Sep. 30, 2023 |
Jun. 30, 2023 |
Jan. 01, 2023 |
Dec. 31, 2022 |
---|---|---|---|---|
Financing Receivable, Allowance for Credit Loss [Line Items] | ||||
Allowance for credit loss for unfunded commitments | $ 844 | $ 844 | $ 511 | |
Impaired loans, unsold guaranteed balance | 6,797 | |||
Unfunded loan commitments | ||||
Financing Receivable, Allowance for Credit Loss [Line Items] | ||||
Allowance for credit loss for unfunded commitments | $ 844 | $ 724 | $ 511 |
ALLOWANCE FOR CREDIT LOSSES - Allowance for Credit Losses for Unfunded Commitments (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | 12 Months Ended |
---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2023 |
Dec. 31, 2022 |
|
Off-Balance-Sheet, Credit Loss, Liability [Roll Forward] | |||
Balance at beginning of period | $ 844 | $ 511 | |
Provision for credit losses | 0 | 120 | |
Unfunded commitments charge-offs | 0 | 0 | |
Unfunded commitments recoveries | 0 | 0 | |
Balance at end of period | 844 | 844 | $ 511 |
Accounting Standards Update [Extensible Enumeration] | Accounting Standards Update 2016-13 [Member] | ||
Impact of adopting ASC 326 | |||
Off-Balance-Sheet, Credit Loss, Liability [Roll Forward] | |||
Balance at beginning of period | $ 0 | $ 213 | |
Balance at end of period | $ 213 |
ALLOWANCE FOR CREDIT LOSSES - Amortized Cost Basis of Individually Analyzed Collateral Dependent Loans (Details) - USD ($) $ in Thousands |
Sep. 30, 2023 |
Jun. 30, 2023 |
Jan. 01, 2023 |
Dec. 31, 2022 |
Sep. 30, 2022 |
Jun. 30, 2022 |
Dec. 31, 2021 |
---|---|---|---|---|---|---|---|
Financing Receivable, Allowance for Credit Loss [Line Items] | |||||||
Amortized cost basis | $ 783,558 | $ 694,154 | |||||
Allowance for credit loss | 13,365 | $ 12,598 | $ 12,153 | $ 9,046 | $ 9,739 | $ 9,564 | $ 13,452 |
Commercial and industrial | Business Assets | |||||||
Financing Receivable, Allowance for Credit Loss [Line Items] | |||||||
Amortized cost basis | 1,500 | ||||||
Allowance for credit loss | $ 206 |
FAIR VALUE - Narrative (Details) |
Dec. 31, 2022
USD ($)
|
---|---|
Fair Value Disclosures [Abstract] | |
Fair value option, loans held as assets, 90 days or more past due | $ 0 |
Fair value option, loans held as assets, aggregate amount in nonaccrual status | $ 0 |
FAIR VALUE - Government Guaranteed Loans Held for Investment, at Fair Value, Which Were Valued on a Recurring Basis and Used Significant Unobservable Inputs (Details) - Loans Receivable - USD ($) $ in Thousands |
9 Months Ended | |
---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance of government guaranteed loans held for investment at fair value, beginning of period | $ 27,078 | $ 9,614 |
New government guaranteed originations at fair value | 143,535 | 53,697 |
Loans sold | (90,120) | (38,722) |
Principal payments | (7,336) | (3,108) |
Charge-offs | 0 | (26) |
Total gains during the period | 11,021 | 3,510 |
Balance of government guaranteed loans held for investment at fair value, end of period | $ 84,178 | $ 24,965 |
FAIR VALUE - Assets Measured at Fair Value on a Nonrecurring Basis (Details) - Fair Value, Nonrecurring - USD ($) $ in Thousands |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Fair Value, Nonrecurring [Line Items] | ||
Individually evaluated loans | $ 1,294 | $ 1,355 |
Discount rate | ||
Fair Value, Nonrecurring [Line Items] | ||
Impaired loans, measurement input | 10.00% | 10.00% |
GOVERNMENT GUARANTEED LOAN SERVICING ACTIVITIES - Narrative (Details) - USD ($) $ in Thousands |
9 Months Ended | 12 Months Ended |
---|---|---|
Sep. 30, 2023 |
Dec. 31, 2022 |
|
Servicing Asset at Amortized Cost [Line Items] | ||
Principal balance of government guaranteed loans, excluding PPP loans | $ 373,719 | $ 300,219 |
Principal balance of government guaranteed loans, excluding PPP loans, guaranteed portion | 176,062 | 139,587 |
Unpaid principal balances of government guaranteed loans serviced for others | $ 825,723 | $ 660,600 |
Servicing assets, weighted average discount rate | 15.25% | 14.88% |
Servicing assets, weighted average prepayment speed | 10.71% | 9.93% |
Government guaranteed loan servicing rights | Significant Unobservable Inputs (Level 3) | Fair Value | ||
Servicing Asset at Amortized Cost [Line Items] | ||
Servicing asset rights at fair value | $ 15,339 | $ 13,051 |
GOVERNMENT GUARANTEED LOAN SERVICING ACTIVITIES - Activity for Government Guaranteed Loan Servicing Rights (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Servicing Asset at Amortized Cost, Balance [Roll Forward] | ||||
Beginning of period | $ 10,906 | |||
End of period | $ 14,216 | 14,216 | ||
Government guaranteed loan servicing rights | ||||
Servicing Asset at Amortized Cost, Balance [Roll Forward] | ||||
Beginning of period | 12,820 | $ 7,760 | 10,906 | $ 6,407 |
Additions | 2,543 | 2,918 | 6,390 | 5,741 |
Amortization | (1,147) | (746) | (3,080) | (2,216) |
End of period | $ 14,216 | $ 9,932 | $ 14,216 | $ 9,932 |
GOVERNMENT GUARANTEED LOAN SERVICING ACTIVITIES - Net Gain on Sale of Government Guaranteed Loans (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Servicing Asset at Amortized Cost [Line Items] | ||||
Gain on sale of government guaranteed loans, net | $ 7,139 | $ 7,446 | $ 17,576 | $ 15,915 |
Government guaranteed loan servicing rights | ||||
Servicing Asset at Amortized Cost [Line Items] | ||||
Gain on sale of guaranteed government guaranteed loans | 4,596 | 4,685 | 11,998 | 10,723 |
Loss on sale of unguaranteed government guaranteed loans | 0 | (63) | (797) | (411) |
Costs recognized on sale of government guaranteed loans | 0 | (94) | (15) | (138) |
Fair value of servicing rights created | 2,543 | 2,918 | 6,390 | 5,741 |
Gain on sale of government guaranteed loans, net | $ 7,139 | $ 7,446 | $ 17,576 | $ 15,915 |
LEASES - Total Lease Cost and Supplemental Information (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Leases [Abstract] | ||||
Operating lease cost | $ 509 | $ 387 | $ 1,097 | $ 1,159 |
Short-term lease cost | (224) | 190 | (204) | 463 |
Total lease cost, net | 285 | 577 | 893 | 1,622 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Lease cost | 285 | 577 | 893 | 1,622 |
Cash flows related to operating lease liabilities | 281 | 388 | 965 | 1,156 |
Right-of-use assets obtained in exchange for new operating lease liabilities | 0 | 627 | 0 | 627 |
Discontinued Operations, Held-for-sale | Nationwide Residential Mortgage Loan Production Operations | ||||
Leases [Abstract] | ||||
Total lease cost, net | 44 | 232 | 131 | 847 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Lease cost | $ 44 | $ 232 | $ 131 | $ 847 |
LEASES - Narrative (Details) - USD ($) $ in Thousands |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Lessee, Lease, Description [Line Items] | ||
Weighted average discount rate | 2.34% | |
Weighted average remaining life | 3 years 4 months 6 days | |
Right-of-use operating lease assets | $ 2,594 | $ 3,177 |
Discontinued Operations, Held-for-sale | Nationwide Residential Mortgage Loan Production Operations | ||
Lessee, Lease, Description [Line Items] | ||
Right-of-use operating lease assets | $ 398 |
LEASES - Maturity (Details) $ in Thousands |
Sep. 30, 2023
USD ($)
|
---|---|
Leases [Abstract] | |
2023 | $ 197 |
2024 | 1,216 |
2025 | 1,029 |
2026 | 832 |
2027 | 413 |
Thereafter | 0 |
Total undiscounted lease payments | 3,687 |
Less: imputed interest | (160) |
Net lease liabilities | $ 3,527 |
Operating Lease, Liability, Statement of Financial Position [Extensible Enumeration] | Operating lease liabilities, Liabilities from discontinued operations |
STOCK-BASED COMPENSATION - Nonvested Restricted Shares (Details) - Restricted Stock |
9 Months Ended |
---|---|
Sep. 30, 2023
$ / shares
shares
| |
Shares | |
Nonvested beginning balance (in shares) | shares | 22,000 |
Granted (in shares) | shares | 46,175 |
Vested (in shares) | shares | (13,935) |
Forfeited (in shares) | shares | (1,865) |
Nonvested ending balance (in shares) | shares | 52,375 |
Weighted-Average Grant-Date Fair Value, per share | |
Nonvested beginning balance (in dollars per share) | $ / shares | $ 21.52 |
Granted (in dollars per share) | $ / shares | 18.30 |
Vested (in dollars per share) | $ / shares | (20.01) |
Forfeited (in dollars per share) | $ / shares | (19.38) |
Nonvested ending balance (in dollars per share) | $ / shares | $ 18.75 |
INCOME TAXES (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Income Tax Disclosure [Abstract] | ||||
Federal tax based on federal corporate statutory rate | $ 555 | $ 854 | $ 1,190 | $ 893 |
State tax, net of federal effect | 81 | 187 | 173 | 132 |
Changes resulting from: | ||||
BOLI income | (6) | (20) | (18) | (32) |
Other, net | 44 | (38) | 70 | (105) |
Income tax expense from continuing operations | 674 | 983 | 1,415 | 888 |
Income tax benefit from discontinued operations | (15) | (1,488) | (68) | (1,670) |
Total income tax expense (benefit) | $ 659 | $ (505) | $ 1,347 | $ (782) |
MORTGAGE BANKING ACTIVITIES - DISCONTINUED OPERATIONS - Fair Value of Mortgage Banking Derivative Assets and Liabilities (Details) - Other Assets - Best efforts forward sales contracts - Discontinued Operations, Held-for-sale - Nationwide Residential Mortgage Loan Production Operations $ in Thousands |
Dec. 31, 2022
USD ($)
|
---|---|
Derivative [Line Items] | |
Notional Amount | $ 221 |
Fair Value | $ 0 |
LOAN COMMITMENTS AND OTHER RELATED ACTIVITIES - Financial Instruments With Off-Balance Sheet Risk (Details) - USD ($) $ in Thousands |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Unfunded loan commitments | ||
Other Commitments [Line Items] | ||
Financial commitments, contractual amount | $ 20,459 | $ 23,512 |
Unused lines of credit | ||
Other Commitments [Line Items] | ||
Financial commitments, contractual amount | 169,634 | 134,366 |
Standby letters of credit | ||
Other Commitments [Line Items] | ||
Financial commitments, contractual amount | $ 61 | $ 244 |
LOAN COMMITMENTS AND OTHER RELATED ACTIVITIES - Narrative (Details) - USD ($) $ in Thousands |
9 Months Ended | |||
---|---|---|---|---|
Sep. 30, 2023 |
Jun. 30, 2023 |
Jan. 01, 2023 |
Dec. 31, 2022 |
|
Other Commitments [Line Items] | ||||
Total ACL for off-balance sheet loan commitments | $ 844 | $ 844 | $ 511 | |
Unfunded loan commitments | ||||
Other Commitments [Line Items] | ||||
Total ACL for off-balance sheet loan commitments | $ 844 | $ 724 | $ 511 | |
Unfunded loan commitments | ||||
Other Commitments [Line Items] | ||||
Unfunded loan commitment period | 90 days |
EARNINGS PER COMMON SHARE - Antidilutive Securities Excluded from Calculation of Weighted Average Shares Outstanding (Details) - shares |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Common stock options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive shares excluded from calculation of weighted average shares outstanding (in shares) | 367,461 | 0 | 374,802 | 0 |
5X?
MK/G9M XCJ#N,_)WGH7:$L!' Q+0['M(?,XLB246)-
M0#Q=A+:[!1M5=*0RILM?X*:!0LW1NTX8P"..8J-\ NQP,/>] ':+:$02-R)!
MM\ZW=3MF+JP.GK!-12"6DO%^$&!% D(LW48T3\D$3X_M-E"ZR4K9.V$P7E<
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M37!@ GJX#]2?CQU=$0>:X(&;X,/XPALKK%!5IZS; ="U3209;ZU855R6H-K,Y@^:WE#9TP#;_/-TI+.B)_G J]0XY/(YMK2DUM)363L
_3:/;Q8__3#QW/&O3OS/C_S#?YR?/[Z]_CCG3?47SKGS
M<3%W?O[QA?.CD^7.A[MB5R7YJKJ\J)M#;0->+(^']>9P6-Z)P_I0U,G:4&UF
MK\8WVV; .<5G)UD5VSK+;YWKQ/\>Y$4O +CN? [! 6FF>
MN])U'D(-LQ+%4/1NM18UIXB!&9[?Y6653ZN!
M0PZB?GA\+N: W>8>6[6%-8:"3C^2ZZB<[Z"6V*R[ R>+3%:9M<2?H*\SUK"B
MQ'J-R/O*P>NF0MY3V5B@$4MR0FM"W12W$2Y;LI+%IV43D+UM%_H[]LFF1+I
M,40:(C^1=2),K<@@(_%WSY#2^Q F
\-A(!"MS+!4,.O:2T@9WIC8=JW^PN3'J
MDM8,Z>]+FD$'GL]OM8:PH9C"H>P&7.P'C\)IX:@N*-'60=IB'34Q5R\U@KJE
M",H?LJ6<_Z8J(1\I>51>1]L'.B^&5/N%\6WHE+*"8<5E<"\.<"G7#LDY,R07
M+ Z0B.T6^<9S7]^^JH-(I)EW%;5 ;4(4UR\JK)!5V:0J8A65"IZ]-WG"=-D_JR_(8N1:P,*/F
MLK)6MXD#L968M_[Q5?EUT)9%@$DC1RJ2UW=EXQ@^I*%HOV[R;%=; ! G=K'I
M>R-44F(9@@4MK46D,45?M6?+ZJ8Q[.R[>=*Q(6]2-/D]UEB[D.Y3 4IXW;68
M2[-)W8$N;?='UOF[H288C7K2)[SJ$NM0_P<_?G-.W
M_/QCY\P77!OP)J,=\IZ/#6%Y0N[^G NS(B,>SY4P@FORS^%8&P6^\J\F)90R
M@F89\#7;"87[4@0#17"]ZZ_O47K^?^=N($P>8$P2GN+[?4*]B0YQDG+)/*
MB/_PA,12HYJF2FI-YCD$>VK'IQ#DVBHNA1D.2[ ->A40'C _84*1!4OGH$@Y
M(6*C[;."S O">GL@5&2Z+T1HED/+L_C
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M,O7'K-%=.&EZ5>?&?,=:OTQ8/_%>>/^6E'S9Z^SJZDJ=