☒ |
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐ |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Oklahoma
|
20-0763496
|
|
( State or other jurisdiction of incorporation or organization)
|
(I.R.S. Employer Identification No.)
|
|
1039 N.W. 63rd Street
|
73116-7361
|
|
(Address of principal executive offices)
|
(Zip Code)
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
Common Stock, $0.01 Par Value Per Share
|
BSVN
|
NASDAQ Global Select Market System
|
Large accelerated filer
|
☐
|
Accelerated filer
|
☐
|
Non-accelerated filer
|
☒ (Do not check if a smaller reporting company)
|
Smaller reporting company
|
☐
|
Emerging growth company
|
☒
|
Page
|
||
PART I.
|
FINANCIAL INFORMATION
|
|
Item 1.
|
||
2
|
||
3
|
||
4
|
||
5
|
||
6
|
||
Item 2.
|
27
|
|
Item 3.
|
50 | |
Item 4.
|
50 | |
PART II.
|
OTHER INFORMATION
|
50 |
Item 1.
|
50 | |
Item 1A.
|
51
|
|
Item 2.
|
51 | |
Item 6.
|
51 | |
52 |
Assets
|
September
30, 2020
(unaudited)
|
December
31, 2019
|
||||||
Cash and due from banks
|
$
|
60,718
|
$
|
117,128
|
||||
Interest-bearing time deposits in other banks
|
23,384
|
30,147
|
||||||
Loans, net of allowance for loan losses of $11,131 and $7,846 at September 30, 2020 and December 31, 2019, respectively
|
869,448
|
699,458
|
||||||
Loans held for sale, at fair value
|
315
|
1,031
|
||||||
Premises and equipment, net
|
9,387
|
9,624
|
||||||
Nonmarketable equity securities
|
1,165
|
1,100
|
||||||
Goodwill and other intangibles, net
|
1,634
|
1,789
|
||||||
Interest receivable and other assets
|
7,303
|
6,115
|
||||||
Total assets
|
$
|
973,354
|
$
|
866,392
|
||||
Liabilities and Shareholders’ Equity
|
||||||||
Deposits
|
||||||||
Noninterest-bearing
|
$
|
272,008
|
$
|
219,221
|
||||
Interest-bearing
|
591,661
|
538,262
|
||||||
Total deposits
|
863,669
|
757,483
|
||||||
Income taxes payable
|
565
|
357
|
||||||
Interest payable and other liabilities
|
3,890
|
8,426
|
||||||
Total liabilities
|
868,124
|
766,266
|
||||||
Shareholders’ equity
|
||||||||
Preferred stock, par value $0.01 per share, 1,000,000
shares authorized; none issued or outstanding
|
-
|
-
|
||||||
Common stock, non-voting, par value $0.01 per share,
20,000,000 shares authorized; none issued or outstanding
|
-
|
-
|
||||||
Common stock, $0.01 par value; 50,000,000 shares authorized; shares
issued and outstanding: 9,241,689 and 10,057,506, at
September 30, 2020 and December 31, 2019 respectively
|
92
|
101
|
||||||
Additional paid-in capital
|
92,960
|
92,391
|
||||||
Retained earnings
|
12,178
|
7,634
|
||||||
Total shareholders’ equity
|
105,230
|
100,126
|
||||||
|
||||||||
Total liabilities and shareholders’ equity
|
$
|
973,354
|
$
|
866,392
|
Three months ended
September 30, |
Nine months ended
September 30, |
|||||||||||||||
2020
|
2019
|
2020
|
2019
|
|||||||||||||
Interest Income
|
||||||||||||||||
Loans, including fees
|
$
|
12,777
|
$
|
12,179
|
$
|
39,268
|
$
|
35,902
|
||||||||
Interest-bearing time deposits in other banks
|
123
|
500
|
419
|
1,414
|
||||||||||||
Interest-bearing deposits in other banks
|
26
|
392
|
303
|
1,398
|
||||||||||||
Total interest income
|
12,926
|
13,071
|
39,990
|
38,714
|
||||||||||||
Interest Expense
|
||||||||||||||||
Deposits
|
1,325
|
2,471
|
5,028
|
7,178
|
||||||||||||
Total interest expense
|
1,325
|
2,471
|
5,028
|
7,178
|
||||||||||||
Net Interest Income
|
11,601
|
10,600
|
34,962
|
31,536
|
||||||||||||
Provision for Loan Losses
|
1,250
|
-
|
3,300
|
-
|
||||||||||||
Net Interest Income After Provision for Loan Losses
|
10,351
|
10,600
|
31,662
|
31,536
|
||||||||||||
Noninterest Income
|
||||||||||||||||
Secondary market income
|
57
|
69
|
134
|
146
|
||||||||||||
Service charges on deposit accounts
|
104
|
110
|
318
|
279
|
||||||||||||
Other
|
173
|
330
|
513
|
602
|
||||||||||||
Total noninterest income
|
334
|
509
|
965
|
1,027
|
||||||||||||
Noninterest Expense
|
||||||||||||||||
Salaries and employee benefits
|
2,505
|
14,256
|
7,576
|
18,792
|
||||||||||||
Furniture and equipment
|
224
|
229
|
658
|
606
|
||||||||||||
Occupancy
|
543
|
436
|
1,417
|
1,157
|
||||||||||||
Data and item processing
|
276
|
276
|
821
|
814
|
||||||||||||
Accounting, marketing and legal fees
|
135
|
218
|
338
|
507
|
||||||||||||
Regulatory assessments
|
164
|
31
|
281
|
94
|
||||||||||||
Advertising and public relations
|
62
|
71
|
360
|
349
|
||||||||||||
Travel, lodging and entertainment
|
50
|
153
|
146
|
287
|
||||||||||||
Other
|
625
|
402
|
1,463
|
1,269
|
||||||||||||
Total noninterest expense
|
4,584
|
16,072
|
13,060
|
23,875
|
||||||||||||
Income (Loss) Before Taxes
|
6,101
|
(4,963
|
)
|
19,567
|
8,688
|
|||||||||||
Income tax expense
|
1,661
|
1,556
|
5,040
|
4,965
|
||||||||||||
Net Income (Loss)
|
$
|
4,440
|
$
|
(6,519
|
)
|
$
|
14,527
|
$
|
3,723
|
|||||||
Earnings per common share - basic
|
$
|
0.48
|
$
|
(0.64
|
)
|
$
|
1.53
|
$
|
0.37
|
|||||||
Earnings per common share - diluted
|
0.48
|
(0.64
|
)
|
1.53
|
0.37
|
|||||||||||
Weighted average common shares outstanding - basic
|
9,228,128
|
10,149,007
|
9,483,540
|
10,174,528
|
||||||||||||
Weighted average common shares outstanding - diluted
|
9,228,128
|
10,161,778
|
9,483,540
|
10,176,360
|
Three Months Ended
September 30,
|
Nine Months Ended
September 30, |
|||||||||||||||
2020
|
2019
|
2020
|
2019
|
|||||||||||||
Common Stock (Shares)
|
||||||||||||||||
Balance at beginning of period
|
9,226,252
|
10,187,500
|
10,057,506
|
10,187,500
|
||||||||||||
Shares issued for restricted stock units
|
19,437
|
19,431
|
19,437
|
19,431
|
||||||||||||
Shares acquired and canceled
|
(4,000
|
)
|
(149,425
|
)
|
(835,254
|
)
|
(149,425
|
)
|
||||||||
Balance at end of period
|
9,241,689
|
10,057,506
|
9,241,689
|
10,057,506
|
||||||||||||
Common Stock (Amount)
|
||||||||||||||||
Balance at beginning of period
|
$
|
92
|
$
|
102
|
$
|
101
|
$
|
102
|
||||||||
Shares acquired and canceled
|
-
|
(1
|
)
|
(9
|
)
|
(1
|
)
|
|||||||||
Balance at end of period
|
$
|
92
|
$
|
101
|
$
|
92
|
$
|
101
|
||||||||
|
||||||||||||||||
Additional Paid-in Capital
|
||||||||||||||||
Balance at beginning of period
|
$
|
92,762
|
$
|
80,604
|
$
|
92,391
|
$
|
80,275
|
||||||||
Stock-based compensation expense
|
198
|
11,749
|
569
|
12,078
|
||||||||||||
Balance at end of period
|
$
|
92,960
|
$
|
92,353
|
$
|
92,960
|
$
|
92,353
|
||||||||
Retained Earnings
|
||||||||||||||||
Balance at beginning of period
|
$
|
8,765
|
$
|
18,331
|
$
|
7,634
|
$
|
8,089
|
||||||||
Net income (loss)
|
4,440
|
(6,519
|
)
|
14,527
|
3,723
|
|||||||||||
Common stock acquired and canceled
|
(103
|
)
|
(2,645
|
)
|
(7,210
|
)
|
(2,645
|
)
|
||||||||
Cash dividends declared ($0.10 per share)
|
(924
|
)
|
(1,006
|
)
|
(2,773
|
)
|
(1,006
|
)
|
||||||||
Balance at end of period
|
$
|
12,178
|
$
|
8,161
|
$
|
12,178
|
$
|
8,161
|
||||||||
Total shareholders’ equity
|
$
|
105,230
|
$
|
100,615
|
$
|
105,230
|
$
|
100,615
|
For the Nine Months Ended
September 30,
|
||||||||
2020
|
2019
|
|||||||
Operating Activities
|
||||||||
Net income
|
$
|
14,527
|
$
|
3,723
|
||||
Items not requiring (providing) cash
|
||||||||
Depreciation and amortization
|
815
|
651
|
||||||
Provision for loan losses
|
3,300
|
-
|
||||||
Gain on sales of loans
|
(134
|
)
|
(146
|
)
|
||||
Stock-based compensation expense
|
569
|
12,078
|
||||||
Loss on sale of premises and equipment
|
-
|
182
|
||||||
Cash receipts from the sale of loans originated for sale
|
6,922
|
6,767
|
||||||
Cash disbursements for loans originated for sale
|
(6,072
|
)
|
(6,109
|
)
|
||||
Gain on sale of other real estate owned
|
-
|
(362
|
)
|
|||||
Deferred income tax (benefit) expense
|
(780
|
)
|
176
|
|||||
Changes in
|
||||||||
Interest receivable and other assets
|
(408
|
)
|
785
|
|||||
Interest payable and other liabilities
|
(223
|
)
|
(3,076
|
)
|
||||
Net cash provided by operating activities
|
18,516
|
14,669
|
||||||
Investing Activities
|
||||||||
Maturities of interest-bearing time deposits in other banks
|
21,190
|
12,606
|
||||||
Purchases of interest-bearing time deposits in other banks
|
(14,427
|
)
|
(12,737
|
)
|
||||
Net change in loans
|
(173,290
|
)
|
(74,755
|
)
|
||||
Purchases of premises and equipment
|
(423
|
)
|
(1,697
|
)
|
||||
Proceeds from sale of premises and equipment
|
-
|
377
|
||||||
Change in nonmarketable equity securities
|
(65
|
)
|
(17
|
)
|
||||
Proceeds from sale of foreclosed assets
|
-
|
473
|
||||||
Net cash used in investing activities
|
(167,015
|
)
|
(75,750
|
)
|
||||
Financing Activities
|
||||||||
Net change in deposits
|
106,186
|
46,231
|
||||||
Cash distributions
|
(6,878
|
)
|
-
|
|||||
Common stock acquired and canceled
|
(7,219
|
)
|
(2,646
|
)
|
||||
Net cash provided by financing activities
|
92,089
|
43,585
|
||||||
Increase (Decrease) in Cash and Due from Banks
|
(56,410
|
)
|
(17,496
|
)
|
||||
Cash and Due from Banks, Beginning of Period
|
117,128
|
128,090
|
||||||
Cash and Due from Banks, End of Period
|
$
|
60,718
|
$
|
110,594
|
||||
Supplemental Disclosure of Cash Flows Information
|
||||||||
Interest paid
|
$
|
5,301
|
$
|
6,912
|
||||
Income taxes paid
|
$
|
5,498
|
$
|
5,458
|
||||
Dividends declared and not paid
|
$
|
924
|
$
|
1,006
|
||||
Non-cash stock contribution
|
$
|
-
|
$
|
11,627
|
||||
Supplemental Disclosure of Non-Cash Investing Activities
|
||||||||
Foreclosed assets acquired in settlement of loans
|
$
|
-
|
$
|
78
|
Note 1: |
Nature of Operations and Summary of Significant Accounting Policies
|
Note 2: |
Restriction on Cash and Due from Banks
|
Note 3: |
Earnings Per Share
|
For the three months ended
September 30,
|
For the nine months ended
September 30,
|
|||||||||||||||
2020
|
2019
|
2020
|
2019
|
|||||||||||||
(Dollars in thousands, except per share amounts)
|
||||||||||||||||
Numerator
|
||||||||||||||||
Net income (loss)
|
$
|
4,440
|
$
|
(6,519
|
)
|
$
|
14,527
|
$
|
3,723
|
|||||||
Denominator
|
||||||||||||||||
Weighted-average shares outstanding for basic earnings per share
|
9,228,128
|
10,149,007
|
9,483,540
|
10,174,528
|
||||||||||||
Dilutive effect of stock compensation (1)
|
-
|
12,771
|
-
|
1,832
|
||||||||||||
Denominator for diluted earnings per share
|
9,228,128
|
10,161,778
|
9,483,540
|
10,176,360
|
||||||||||||
Earnings per common share
|
||||||||||||||||
Basic
|
$
|
0.48
|
$
|
(0.64
|
)
|
$
|
1.53
|
$
|
0.37
|
|||||||
Diluted
|
$
|
0.48
|
$
|
(0.64
|
)
|
$
|
1.53
|
$
|
0.37
|
Note 4: |
Loans and Allowance for Loan Losses
|
|
September 30,
|
December 31,
|
||||||
|
2020
|
2019
|
||||||
|
||||||||
Construction & development
|
$
|
108,453
|
$
|
70,628
|
||||
1 - 4 family real estate
|
31,113
|
34,160
|
||||||
Commercial real estate - other
|
282,447
|
273,278
|
||||||
Total commercial real estate
|
422,013
|
378,066
|
||||||
|
||||||||
Commercial & industrial
|
400,378
|
260,762
|
||||||
Agricultural
|
50,578
|
57,945
|
||||||
Consumer
|
10,253
|
11,895
|
||||||
|
||||||||
Gross loans
|
883,222
|
708,668
|
||||||
|
||||||||
Less allowance for loan losses
|
(11,131
|
)
|
(7,846
|
)
|
||||
Less deferred loan fees
|
(2,643
|
)
|
(1,364
|
)
|
||||
|
||||||||
Net loans
|
$
|
869,448
|
$
|
699,458
|
Construction &
Development
|
1 - 4 Family
Commercial
|
Commercial
Real Estate -
Other
|
Commercial
& Industrial
|
Agricultural
|
Consumer
|
Total
|
||||||||||||||||||||||
September 30, 2020
|
||||||||||||||||||||||||||||
Balance, beginning of period
|
$
|
1,086
|
$
|
349
|
$
|
3,358
|
$
|
4,380
|
$
|
579
|
$
|
126
|
$
|
9,878
|
||||||||||||||
Charge-offs
|
-
|
-
|
-
|
-
|
-
|
(1
|
)
|
(1
|
)
|
|||||||||||||||||||
Recoveries
|
-
|
-
|
-
|
4
|
-
|
-
|
4
|
|||||||||||||||||||||
Net recoveries
|
-
|
-
|
-
|
4
|
-
|
(1
|
)
|
3
|
||||||||||||||||||||
Provision (credit) for loan losses
|
281
|
43
|
202
|
662
|
58
|
4
|
1,250
|
|||||||||||||||||||||
Balance, end of period
|
$
|
1,367
|
$
|
392
|
$
|
3,560
|
$
|
5,046
|
$
|
637
|
$
|
129
|
$
|
11,131
|
Construction &
Development
|
1 - 4 Family
Commercial
|
Commercial
Real Estate -
Other
|
Commercial
& Industrial
|
Agricultural
|
Consumer
|
Total
|
||||||||||||||||||||||
September 30, 2019
|
||||||||||||||||||||||||||||
Balance, beginning of period
|
$
|
1,031
|
$
|
448
|
$
|
2,329
|
$
|
3,171
|
$
|
695
|
$
|
162
|
$
|
7,836
|
||||||||||||||
Charge-offs
|
-
|
(2
|
)
|
-
|
-
|
-
|
-
|
(2
|
)
|
|||||||||||||||||||
Recoveries
|
-
|
1
|
-
|
6
|
-
|
-
|
7
|
|||||||||||||||||||||
Net recoveries
|
-
|
(1
|
)
|
-
|
6
|
-
|
-
|
5
|
||||||||||||||||||||
Provision (credit) for loan losses
|
(234
|
)
|
(99
|
)
|
618
|
(248
|
)
|
(16
|
)
|
(21
|
)
|
-
|
||||||||||||||||
Balance, end of period
|
$
|
797
|
$
|
348
|
$
|
2,947
|
$
|
2,929
|
$
|
679
|
$
|
141
|
$
|
7,841
|
Construction &
Development
|
1 - 4 Family
Real Estate
|
Commercial
Real Estate -
Other
|
Commercial
& Industrial
|
Agricultural
|
Consumer
|
Total
|
||||||||||||||||||||||
September 30, 2020
|
||||||||||||||||||||||||||||
Balance, beginning of period
|
$
|
782
|
$
|
378
|
$
|
3,025
|
$
|
2,887
|
$
|
642
|
$
|
132
|
$
|
7,846
|
||||||||||||||
Charge-offs
|
-
|
-
|
-
|
(39
|
)
|
-
|
(1
|
)
|
(40
|
)
|
||||||||||||||||||
Recoveries
|
-
|
2
|
-
|
13
|
10
|
-
|
25
|
|||||||||||||||||||||
Net charge-offs
|
-
|
2
|
-
|
(26
|
)
|
10
|
(1
|
)
|
(15
|
)
|
||||||||||||||||||
Provision (credit) for loan losses
|
585
|
12
|
535
|
2,185
|
(15
|
)
|
(2
|
)
|
3,300
|
|||||||||||||||||||
Balance, end of period
|
$
|
1,367
|
$
|
392
|
$
|
3,560
|
$
|
5,046
|
$
|
637
|
$
|
129
|
$
|
11,131
|
Construction &
|
1 - 4 Family
|
Commercial
Real Estate -
|
Commercial
|
|
||||||||||||||||||||||||
Development
|
Real Estate
|
Other
|
& Industrial
|
Agricultural
|
Consumer
|
Total
|
||||||||||||||||||||||
September 30, 2019
|
||||||||||||||||||||||||||||
Balance, beginning of period
|
$
|
1,136
|
$
|
433
|
$
|
2,035
|
$
|
3,231
|
$
|
818
|
$
|
179
|
$
|
7,832
|
||||||||||||||
Charge-offs
|
-
|
(2
|
)
|
-
|
(4
|
)
|
(11
|
)
|
-
|
(17
|
)
|
|||||||||||||||||
Recoveries
|
-
|
3
|
-
|
20
|
3
|
-
|
26
|
|||||||||||||||||||||
Net recoveries
|
-
|
1
|
-
|
16
|
(8
|
)
|
-
|
9
|
||||||||||||||||||||
Provision (credit) for loan losses
|
(339
|
)
|
(86
|
)
|
912
|
(318
|
)
|
(131
|
)
|
(38
|
)
|
-
|
||||||||||||||||
Balance, end of period
|
$
|
797
|
$
|
348
|
$
|
2,947
|
$
|
2,929
|
$
|
679
|
$
|
141
|
$
|
7,841
|
Construction &
Development
|
1 - 4 Family
Real Estate
|
Commercial
Real Estate -
Other
|
Commercial
& Industrial
|
Agricultural
|
Consumer
|
Total
|
||||||||||||||||||||||
September 30, 2020
|
||||||||||||||||||||||||||||
Allowance Balance
|
||||||||||||||||||||||||||||
Ending balance Individually evaluated for impairment
|
$
|
-
|
$
|
130
|
$
|
26
|
$
|
-
|
$
|
200
|
$
|
-
|
$
|
356
|
||||||||||||||
Collectively evaluated for impairment
|
1,367
|
262
|
3,534
|
5,046
|
437
|
129
|
10,775
|
|||||||||||||||||||||
Total
|
$
|
1,367
|
$
|
392
|
$
|
3,560
|
$
|
5,046
|
$
|
637
|
$
|
129
|
$
|
11,131
|
||||||||||||||
Gross Loans
|
||||||||||||||||||||||||||||
Ending balance Individually evaluated for impairment
|
$
|
-
|
$
|
1,128
|
$
|
5,124
|
$
|
26,281
|
$
|
1,948
|
$
|
-
|
$
|
34,481
|
||||||||||||||
Collectively evaluated for impairment
|
108,453
|
29,985
|
277,323
|
374,097
|
48,630
|
10,253
|
848,741
|
|||||||||||||||||||||
Total
|
$
|
108,453
|
$
|
31,113
|
$
|
282,447
|
$
|
400,378
|
$
|
50,578
|
$
|
10,253
|
$
|
883,222
|
||||||||||||||
December 31, 2019
|
||||||||||||||||||||||||||||
Allowance Balance
|
||||||||||||||||||||||||||||
Ending balance Individually evaluated for impairment
|
$
|
-
|
$
|
-
|
$
|
26
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
26
|
||||||||||||||
Collectively evaluated for impairment
|
782
|
378
|
2,999
|
2,887
|
642
|
132
|
7,820
|
|||||||||||||||||||||
Total
|
$
|
782
|
$
|
378
|
$
|
3,025
|
$
|
2,887
|
$
|
642
|
$
|
132
|
$
|
7,846
|
||||||||||||||
Gross Loans
|
||||||||||||||||||||||||||||
Ending balance Individually evaluated for impairment
|
$
|
-
|
$
|
-
|
$
|
5,841
|
$
|
2,750
|
$
|
2,527
|
$
|
-
|
$
|
11,118
|
||||||||||||||
Collectively evaluated for impairment
|
70,628
|
34,160
|
267,437
|
258,012
|
55,418
|
11,895
|
697,550
|
|||||||||||||||||||||
Total
|
$
|
70,628
|
$
|
34,160
|
$
|
273,278
|
$
|
260,762
|
$
|
57,945
|
$
|
11,895
|
$
|
708,668
|
• |
Grade 1 (Pass) – These loans generally conform to Bank policies, and are characterized by policy conforming advance rates on collateral, and have
well-defined repayment sources. In addition, these credits are extended to Borrowers and/or Guarantors with a strong balance sheet and either substantial liquidity or a reliable income history.
|
• |
Grade 2 (Watch) – These loans are still considered “Pass” credits; however, various factors such as industry stress, material changes in cash flow or financial conditions, or deficiencies in loan
documentation, or other risk issues determined by the Lending Officer, Commercial Loan Committee (CLC), or Credit Quality Committee (CQC) warrant a heightened sense and frequency of monitoring.
|
• |
Grade 3 (Special Mention) – These loans must have observable weaknesses or evidence of imprudent handling or structural issues. The weaknesses require close attention and the remediation of those
weaknesses is necessary. No risk of probable loss exists. Credits in this category are expected to quickly migrate to a “2” or a “4” as this is viewed as a transitory loan grade.
|
• |
Grade 4 (Substandard) – These loans are not adequately protected by the sound worth and debt service capacity of the Borrower, but may be well secured. They have defined weaknesses relative to cash
flow, collateral, financial condition, or other factors that might jeopardize repayment of all of the principal and interest on a timely basis. There is the possibility that a future loss will occur if weaknesses are not remediated.
|
Construction &
Development
|
1 - 4 Family
Real Estate
|
Commercial
Real Estate -
Other
|
Commercial
& Industrial
|
Agricultural
|
Consumer
|
Total
|
||||||||||||||||||||||
September 30, 2020
|
||||||||||||||||||||||||||||
Grade
|
||||||||||||||||||||||||||||
1 (Pass)
|
$
|
108,453
|
$
|
29,209
|
$
|
264,337
|
$
|
352,477
|
$
|
48,630
|
$
|
10,253
|
$
|
813,359
|
||||||||||||||
2 (Watch)
|
-
|
776
|
9,988
|
11,662
|
-
|
-
|
22,426
|
|||||||||||||||||||||
3 (Special Mention)
|
-
|
-
|
2,998
|
9,958
|
-
|
-
|
12,956
|
|||||||||||||||||||||
4 (Substandard)
|
-
|
1,128
|
5,124
|
26,281
|
1,948
|
-
|
34,481
|
|||||||||||||||||||||
Total
|
$
|
108,453
|
$
|
31,113
|
$
|
282,447
|
$
|
400,378
|
$
|
50,578
|
$
|
10,253
|
$
|
883,222
|
Construction &
Development
|
1 - 4 Family
Real Estate
|
Commercial
Real Estate -
Other
|
Commercial
& Industrial
|
Agricultural
|
Consumer
|
Total
|
||||||||||||||||||||||
December 31, 2019
|
||||||||||||||||||||||||||||
Grade
|
||||||||||||||||||||||||||||
1 (Pass)
|
$
|
70,628
|
$
|
33,622
|
$
|
267,437
|
$
|
241,176
|
$
|
53,290
|
$
|
11,895
|
$
|
678,048
|
||||||||||||||
2 (Watch)
|
-
|
538
|
-
|
5,312
|
-
|
-
|
5,850
|
|||||||||||||||||||||
3 (Special Mention)
|
-
|
-
|
-
|
11,524
|
2,128
|
-
|
13,652
|
|||||||||||||||||||||
4 (Substandard)
|
-
|
-
|
5,841
|
2,750
|
2,527
|
-
|
11,118
|
|||||||||||||||||||||
Total
|
$
|
70,628
|
$
|
34,160
|
$
|
273,278
|
$
|
260,762
|
$
|
57,945
|
$
|
11,895
|
$
|
708,668
|
Past Due
|
Total Loans
|
|||||||||||||||||||||||||||
30–59
|
60–89
|
Greater than
|
Total
|
> 90 Days &
|
||||||||||||||||||||||||
Days
|
Days
|
90 Days
|
Total
|
Current
|
Loans
|
Accruing
|
||||||||||||||||||||||
September 30, 2020
|
||||||||||||||||||||||||||||
Construction & development
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
108,453
|
$
|
108,453
|
$
|
-
|
||||||||||||||
1 - 4 Family Real Estate
|
-
|
-
|
-
|
-
|
31,113
|
31,113
|
-
|
|||||||||||||||||||||
Commercial Real Estate - other
|
-
|
1,957
|
-
|
1,957
|
280,490
|
282,447
|
-
|
|||||||||||||||||||||
Commercial & industrial
|
920
|
7,071
|
-
|
7,991
|
392,387
|
400,378
|
-
|
|||||||||||||||||||||
Agricultural
|
-
|
1,948
|
-
|
1,948
|
48,630
|
50,578
|
-
|
|||||||||||||||||||||
Consumer
|
-
|
-
|
-
|
-
|
10,253
|
10,253
|
-
|
|||||||||||||||||||||
Total
|
$
|
920
|
$
|
10,976
|
$
|
-
|
$
|
11,896
|
$
|
871,326
|
$
|
883,222
|
$
|
-
|
||||||||||||||
December 31, 2019
|
||||||||||||||||||||||||||||
Construction & development
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
70,628
|
$
|
70,628
|
$
|
-
|
||||||||||||||
1 - 4 Family Real Estate
|
-
|
-
|
-
|
-
|
34,160
|
34,160
|
-
|
|||||||||||||||||||||
Commercial Real Estate - other
|
-
|
-
|
-
|
-
|
273,278
|
273,278
|
-
|
|||||||||||||||||||||
Commercial & industrial
|
-
|
-
|
14
|
14
|
260,748
|
260,762
|
14
|
|||||||||||||||||||||
Agricultural
|
-
|
-
|
598
|
598
|
57,347
|
57,945
|
598
|
|||||||||||||||||||||
Consumer
|
90
|
-
|
-
|
90
|
11,805
|
11,895
|
-
|
|||||||||||||||||||||
Total
|
$
|
90
|
$
|
-
|
$
|
612
|
$
|
702
|
$
|
707,966
|
$
|
708,668
|
$
|
612
|
|
Unpaid
Principal
Balance
|
Recorded
Investment
with No
Allowance
|
Recorded
Investment
with an
Allowance
|
Total
Recorded
Investment
|
Related
Allowance
|
Average
Recorded
Investment
|
Interest
Income
Recognized
|
Average
Recorded
Investment
|
Interest
Income
Recognized
|
|||||||||||||||||||||||||||
|
Three Months Ended
September 30, 2020
|
Nine Months Ended
September 30, 2020
|
||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
September 30, 2020
|
||||||||||||||||||||||||||||||||||||
Construction & development
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||||||||||||||
1 - 4 Family Real Estate
|
1,128
|
-
|
1,128
|
1,128
|
130
|
1,133
|
15
|
3,732
|
47
|
|||||||||||||||||||||||||||
Commercial Real Estate - other
|
5,124
|
3,468
|
1,656
|
5,124
|
26
|
5,160
|
144
|
2,121
|
274
|
|||||||||||||||||||||||||||
Commercial & industrial
|
26,281
|
26,281
|
-
|
26,281
|
-
|
26,549
|
996
|
21,780
|
1,317
|
|||||||||||||||||||||||||||
Agricultural
|
1,948
|
-
|
1,948
|
1,948
|
200
|
2,681
|
(54
|
)
|
1,483
|
(13
|
)
|
|||||||||||||||||||||||||
Consumer
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
1,590
|
-
|
|||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
Total
|
$
|
34,481
|
$
|
29,749
|
$
|
4,732
|
$
|
34,481
|
$
|
356
|
$
|
35,523
|
$
|
1,101
|
$
|
30,706
|
$
|
1,625
|
December 31, 2019
|
Three Months Ended
September 30, 2019
|
Nine Months Ended
September 30, 2019
|
||||||||||||||||||||||||||||||||||
Construction & development
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||||||||||||||
1 - 4 Family Real Estate
|
-
|
-
|
-
|
-
|
-
|
3
|
-
|
277
|
-
|
|||||||||||||||||||||||||||
Commercial Real Estate - other
|
5,841
|
4,032
|
1,809
|
5,841
|
26
|
3,354
|
131
|
1,883
|
197
|
|||||||||||||||||||||||||||
Commercial & industrial
|
2,750
|
2,750
|
-
|
2,750
|
-
|
6,612
|
91
|
6,164
|
49
|
|||||||||||||||||||||||||||
Agricultural
|
2,527
|
1,744
|
-
|
1,744
|
-
|
2,421
|
(56
|
)
|
2,267
|
269
|
||||||||||||||||||||||||||
Consumer
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
128
|
-
|
|||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
Total
|
$
|
11,118
|
$
|
8,526
|
$
|
1,809
|
$
|
10,335
|
$
|
26
|
$
|
12,390
|
$
|
166
|
$
|
10,719
|
$
|
515
|
As of
|
||||||||
September 30,
2020 |
December 31,
2019 |
|||||||
Nonaccrual loans
|
$
|
20,515
|
$
|
1,809
|
||||
Troubled-debt restructurings (1)
|
-
|
912
|
||||||
Accruing loans 90 or more days past due
|
-
|
612
|
||||||
Total nonperforming loans
|
$
|
20,515
|
$
|
3,333
|
||||
(1) $1.66 million and $1.81 million of TDRs as of September 30, 2020 and December 31, 2019, respectively, are
included in the nonaccrual loans balance in the line above.
|
Note 5: |
Shareholders’ Equity
|
|
Nine Months Ended
September 30,
|
Three Months Ended
September 30,
|
||||||||||||||
|
2020
|
2019
|
2020
|
2019
|
||||||||||||
Number of shares repurchased
|
835,254
|
-
|
38,160
|
-
|
||||||||||||
Average price of shares repurchased
|
$
|
8.56
|
$
|
-
|
$
|
8.96
|
$
|
-
|
||||||||
Shares remaining to be repurchased
|
164,746
|
-
|
164,746
|
-
|
Actual
|
Minimum
Capital Requirements
|
With Capital
Conservation Buffer
|
Minimum
To Be Well Capitalized
Under Prompt
Corrective Action
|
|||||||||||||||||||||||||||||
Amount
|
Ratio
|
Amount
|
Ratio
|
Amount
|
Ratio
|
Amount
|
Ratio
|
|||||||||||||||||||||||||
As of September 30, 2020
|
||||||||||||||||||||||||||||||||
Total capital to risk-weighted assets
|
||||||||||||||||||||||||||||||||
Company
|
$
|
113,695
|
14.09
|
%
|
$
|
64,551
|
8.00
|
%
|
$
|
84,723
|
10.50
|
%
|
N/A
|
N/A
|
||||||||||||||||||
Bank
|
$
|
113,640
|
14.10
|
%
|
$
|
64,469
|
8.00
|
%
|
$
|
84,615
|
10.50
|
%
|
$
|
80,586
|
10.00
|
%
|
||||||||||||||||
Tier I capital to risk-weighted assets
|
||||||||||||||||||||||||||||||||
Company
|
$
|
103,596
|
12.84
|
%
|
$
|
48,413
|
6.00
|
%
|
$
|
68,585
|
8.50
|
%
|
N/A
|
N/A
|
||||||||||||||||||
Bank
|
$
|
103,554
|
12.85
|
%
|
$
|
48,352
|
6.00
|
%
|
$
|
68,498
|
8.50
|
%
|
$
|
64,469
|
8.00
|
%
|
||||||||||||||||
CET I capital to risk-weighted assets
|
||||||||||||||||||||||||||||||||
Company
|
$
|
103,596
|
12.84
|
%
|
$
|
36,310
|
4.50
|
%
|
$
|
56,482
|
7.00
|
%
|
N/A
|
N/A
|
||||||||||||||||||
Bank
|
$
|
103,554
|
12.85
|
%
|
$
|
36,264
|
4.50
|
%
|
$
|
56,410
|
7.00
|
%
|
$
|
52,381
|
6.50
|
%
|
||||||||||||||||
Tier I capital to average assets
|
||||||||||||||||||||||||||||||||
Company
|
$
|
103,596
|
10.72
|
%
|
$
|
38,672
|
4.00
|
%
|
N/A
|
N/A
|
N/A
|
N/A
|
||||||||||||||||||||
Bank
|
$
|
103,554
|
10.72
|
%
|
$
|
38,632
|
4.00
|
%
|
N/A
|
N/A
|
$
|
48,289
|
5.00
|
%
|
||||||||||||||||||
|
||||||||||||||||||||||||||||||||
As of December 31, 2019
|
||||||||||||||||||||||||||||||||
Total capital to risk-weighted assets
|
||||||||||||||||||||||||||||||||
Company
|
$
|
105,137
|
15.25
|
%
|
$
|
55,157
|
8.00
|
%
|
$
|
72,393
|
10.50
|
%
|
N/A
|
N/A
|
||||||||||||||||||
Bank
|
$
|
106,148
|
15.42
|
%
|
$
|
55,076
|
8.00
|
%
|
$
|
72,287
|
10.50
|
%
|
$
|
68,845
|
10.00
|
%
|
||||||||||||||||
Tier I capital to risk-weighted assets
|
||||||||||||||||||||||||||||||||
Company
|
$
|
97,291
|
14.11
|
%
|
$
|
41,368
|
6.00
|
%
|
$
|
58,604
|
8.50
|
%
|
N/A
|
N/A
|
||||||||||||||||||
Bank
|
$
|
98,302
|
14.28
|
%
|
$
|
41,307
|
6.00
|
%
|
$
|
58,518
|
8.50
|
%
|
$
|
55,076
|
8.00
|
%
|
||||||||||||||||
CET I capital to risk-weighted assets
|
||||||||||||||||||||||||||||||||
Company
|
$
|
97,291
|
14.11
|
%
|
$
|
31,026
|
4.50
|
%
|
$
|
48,262
|
7.00
|
%
|
N/A
|
N/A
|
||||||||||||||||||
Bank
|
$
|
98,302
|
14.28
|
%
|
$
|
30,980
|
4.50
|
%
|
$
|
48,192
|
7.00
|
%
|
$
|
44,749
|
6.50
|
%
|
||||||||||||||||
Tier I capital to average assets
|
||||||||||||||||||||||||||||||||
Company
|
$
|
97,291
|
11.53
|
%
|
$
|
33,833
|
4.00
|
%
|
N/A
|
N/A
|
N/A
|
N/A
|
||||||||||||||||||||
Bank
|
$
|
98,302
|
11.65
|
%
|
$
|
33,793
|
4.00
|
%
|
N/A
|
N/A
|
$
|
42,241
|
5.00
|
%
|
Capital Conservation Buffer
(as a % of risk-weighted assets) |
|
Maximum Payout
(as a % of eligible retained income) |
Greater than 2.5%
|
|
No payout limitations applies
|
≤2.5% and >1.875%
|
|
60%
|
≤1.875% and >1.25%
|
|
40%
|
≤1.25% and >0.625%
|
|
20%
|
≤0.625%
|
|
0%
|
Note 6: |
Related-Party Transactions
|
Balance
Beginning of
the Period
|
Additions
|
Collections/
Terminations
|
Balance
End of
the Period
|
|||||||||||||
|
||||||||||||||||
Nine months ended September 30, 2020
|
$
|
1,055
|
$
|
-
|
$
|
(1,055
|
)
|
$
|
-
|
|||||||
Year ended December 31, 2019
|
$
|
6,897
|
$
|
2,613
|
$
|
(8,455
|
)
|
$
|
1,055
|
Note 7: |
Employee Benefits
|
|
Options
|
Wgtd. Avg. Exercise
Price
|
Wgtd. Avg.
Remaining
Contractual Term
|
Aggregate
Intrinsic
Value
|
||||||||||||
Nine Months Ended September 30, 2020
|
||||||||||||||||
Outstanding at December 31, 2019
|
163,000
|
$
|
18.75
|
|||||||||||||
Options Granted
|
26,500
|
18.49
|
||||||||||||||
Options Exercised
|
-
|
-
|
||||||||||||||
Options Forfeited
|
(4,250
|
)
|
17.73
|
|||||||||||||
Outstanding at September 30, 2020
|
185,250
|
18.73
|
8.19
|
$
|
0
|
|||||||||||
Exercisable at September 30, 2020
|
75,625
|
18.88
|
8.00
|
$
|
0
|
|
Nine Months Ended
|
|||||||
|
September 30, 2020
|
September 30, 2019
|
||||||
Risk-free interest rate
|
1.71
|
%
|
2.48
|
%
|
||||
Dividend yield
|
2.20
|
%
|
2.20
|
%
|
||||
Stock price volatility
|
41.27
|
%
|
31.14
|
%
|
||||
Expected term
|
7.51
|
7.01
|
|
Number of
Shares
|
Wgtd. Avg. Grant
Date Fair Value
|
||||||
Outstanding at December 31, 2019
|
104,000
|
$
|
19.09
|
|||||
Shares granted
|
31,000
|
18.49
|
||||||
Shares settled
|
26,000
|
19.09
|
||||||
Shares forfeited
|
(1,000
|
)
|
18.49
|
|||||
End of the period balance
|
108,000
|
$
|
18.92
|
Note 8: |
Disclosures About Fair Value of Assets and Liabilities
|
Level 1 |
Quoted prices in active markets for identical assets or liabilities
|
Level 2 |
Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for
substantially the full term of the assets or liabilities
|
Level 3 |
Unobservable inputs supported by little or no market activity and significant to the fair value of the assets or liabilities
|
|
Fair Value
|
(Level 1)
|
(Level 2)
|
(Level 3)
|
||||||||||||
|
||||||||||||||||
September 30, 2020
|
||||||||||||||||
Impaired loans (collateral- dependent)
|
$
|
4,376
|
$
|
-
|
$
|
-
|
$
|
4,376
|
||||||||
December 31, 2019
|
||||||||||||||||
Impaired loans (collateral- dependent)
|
$
|
1,783
|
$
|
-
|
$
|
-
|
$
|
1,783
|
Valuation
|
Unobservable
|
Weighted-
|
|||||||||
Fair Value
|
Technique
|
Inputs
|
Average
|
||||||||
September 30, 2020
|
|
|
|||||||||
Collateral-dependent impaired loans
|
$
|
4,376
|
Appraisals from comparable properties
|
Estimated cost to sell
|
3-5
|
%
|
|||||
|
|
||||||||||
December 31, 2019
|
|
|
|||||||||
Collateral-dependent impaired loans
|
$
|
1,783
|
Appraisals from comparable properties
|
Estimated cost to sell
|
3-5
|
%
|
Carrying
|
Fair Value Measurements
|
|||||||||||||||||||
Amount
|
Level 1
|
Level 2
|
Level 3
|
Total
|
||||||||||||||||
September 30, 2020
|
||||||||||||||||||||
Financial Assets
|
||||||||||||||||||||
Cash and due from banks
|
$
|
60,718
|
$
|
60,718
|
$
|
-
|
$
|
-
|
$
|
60,718
|
||||||||||
Interest-bearing time deposits in other banks
|
$
|
23,384
|
$
|
-
|
$
|
23,384
|
$
|
-
|
$
|
23,384
|
||||||||||
Loans, net of allowance
|
$
|
869,448
|
$
|
-
|
$
|
864,956
|
$
|
4,376
|
$
|
869,332
|
||||||||||
Mortgage loans held for sale
|
$
|
315
|
$
|
-
|
$
|
315
|
$
|
-
|
$
|
315
|
||||||||||
Nonmarketable equity securities
|
$
|
1,165
|
$
|
-
|
$
|
1,165
|
$
|
-
|
$
|
1,165
|
||||||||||
Interest receivable
|
$
|
4,786
|
$
|
-
|
$
|
4,786
|
$
|
-
|
$
|
4,786
|
||||||||||
|
||||||||||||||||||||
Financial Liabilities
|
||||||||||||||||||||
Deposits
|
$
|
863,669
|
$
|
-
|
$
|
862,490
|
$
|
-
|
$
|
862,490
|
||||||||||
Interest payable
|
$
|
362
|
$
|
-
|
$
|
362
|
$
|
-
|
$
|
362
|
||||||||||
|
||||||||||||||||||||
December 31, 2019
|
||||||||||||||||||||
Financial Assets
|
||||||||||||||||||||
Cash and due from banks
|
$
|
117,128
|
$
|
117,128
|
$
|
-
|
$
|
-
|
$
|
117,128
|
||||||||||
Interest-bearing time deposits in other banks
|
$
|
30,147
|
$
|
-
|
$
|
30,147
|
$
|
-
|
$
|
30,147
|
||||||||||
Loans, net of allowance
|
$
|
699,458
|
$
|
-
|
$
|
698,672
|
$
|
1,809
|
$
|
700,481
|
||||||||||
Mortgage loans held for sale
|
$
|
1,031
|
$
|
-
|
$
|
1,031
|
$
|
-
|
$
|
1,031
|
||||||||||
Nonmarketable equity securities
|
$
|
1,100
|
$
|
-
|
$
|
1,100
|
$
|
-
|
$
|
1,100
|
||||||||||
Interest receivable
|
$
|
3,954
|
$
|
-
|
$
|
3,954
|
$
|
-
|
$
|
3,954
|
||||||||||
Financial Liabilities
|
||||||||||||||||||||
Deposits
|
$
|
757,483
|
$
|
-
|
$
|
757,520
|
$
|
-
|
$
|
757,520
|
||||||||||
Interest payable
|
$
|
636
|
$
|
-
|
$
|
636
|
$
|
-
|
$
|
636
|
Note 9: |
Financial Instruments with Off-Balance Sheet Risk
|
|
September 30,
|
December 31,
|
||||||
|
2020
|
2019
|
||||||
|
||||||||
Commitments to extend credit
|
$
|
191,479
|
$
|
191,459
|
||||
Financial and performance standby letters of credit
|
860
|
3,338
|
||||||
|
||||||||
|
$
|
192,339
|
$
|
194,797
|
Note 10: |
Significant Estimates and Concentrations
|
Three months ended
September 30,
|
Nine months ended
September 30,
|
|||||||||||||||
(Dollars in thousands, except per share data)
|
2020
|
2019
|
2020
|
2019
|
||||||||||||
Loan interest income (excluding loan fees)
|
||||||||||||||||
Total loan interest income, including loan fee income
|
$
|
12,777
|
$
|
12,179
|
$
|
39,268
|
$
|
35,902
|
||||||||
Loan fee income
|
(1,078
|
)
|
(841
|
)
|
(3,969
|
)
|
(3,498
|
)
|
||||||||
Loan interest income excluding loan fee income
|
$
|
11,699
|
$
|
11,338
|
$
|
35,299
|
$
|
32,404
|
||||||||
Average total loans
|
$
|
847,076
|
$
|
651,186
|
$
|
807,134
|
$
|
617,398
|
||||||||
Yield on loans (including loan fee income)
|
6.00
|
%
|
7.42
|
%
|
6.50
|
%
|
7.77
|
%
|
||||||||
Yield on loans (excluding loan fee income)
|
5.49
|
%
|
6.91
|
%
|
5.84
|
%
|
7.02
|
%
|
||||||||
Net interest margin (excluding loan fees)
|
||||||||||||||||
Net interest income
|
$
|
11,601
|
$
|
10,600
|
$
|
34,962
|
$
|
31,536
|
||||||||
Loan fee income
|
(1,078
|
)
|
(841
|
)
|
(3,969
|
)
|
(3,498
|
)
|
||||||||
Net interest income excluding loan fees
|
$
|
10,523
|
$
|
9,759
|
$
|
30,993
|
$
|
28,038
|
||||||||
Average earning assets
|
$
|
959,658
|
$
|
797,667
|
$
|
929,410
|
$
|
773,752
|
||||||||
Net interest margin (including loan fee income)
|
4.81
|
%
|
5.27
|
%
|
5.02
|
%
|
5.45
|
%
|
||||||||
Net interest margin (excluding loan fee income)
|
4.36
|
%
|
4.85
|
%
|
4.45
|
%
|
4.84
|
%
|
Three months ended
September 30,
|
Nine months ended
September 30,
|
|||||||||||||||
(Dollars in thousands, except per share data)
|
2020
|
2019
|
2020
|
2019
|
||||||||||||
Pre-tax, pre-provision net earnings
|
||||||||||||||||
Net income (loss) before income taxes
|
$
|
6,101
|
$
|
(4,963
|
)
|
$
|
19,567
|
$
|
8,688
|
|||||||
Plus: Provision for loan losses
|
(1,250
|
)
|
-
|
(3,300
|
)
|
-
|
||||||||||
Pre-tax, pre-provision net earnings
|
$
|
7,351
|
$
|
(4,963
|
)
|
$
|
22,867
|
$
|
8,688
|
|||||||
Ratios
|
||||||||||||||||
Net income (loss) (numerator)
|
$
|
4,440
|
$
|
(6,519
|
)
|
$
|
14,527
|
$
|
3,723
|
|||||||
Average assets (denominator)
|
$
|
967,044
|
$
|
806,440
|
$
|
937,849
|
$
|
782,694
|
||||||||
Return on average assets
|
1.83
|
%
|
-3.21
|
%
|
2.07
|
%
|
0.64
|
%
|
||||||||
Average shareholders’ equity (denominator)
|
$
|
102,929
|
$
|
100,012
|
$
|
101,377
|
$
|
95,655
|
||||||||
Return on average shareholders’ equity
|
17.16
|
%
|
-25.86
|
%
|
19.14
|
%
|
5.20
|
%
|
||||||||
Average tangible common equity (denominator)
|
$
|
101,269
|
$
|
98,145
|
$
|
99,667
|
$
|
93,736
|
||||||||
Return on average tangible common equity
|
17.44
|
%
|
-26.35
|
%
|
19.47
|
%
|
5.31
|
%
|
||||||||
Per share data
|
||||||||||||||||
Weighted average common shares outstanding basic (denominator)
|
9,228,128
|
10,149,007
|
9,483,540
|
10,174,528
|
||||||||||||
Net income per common share--basic
|
$
|
0.48
|
$
|
(0.64
|
)
|
$
|
1.53
|
$
|
0.37
|
|||||||
Weighted average common shares outstanding diluted (denominator)
|
9,228,128
|
10,161,778
|
9,483,540
|
10,176,360
|
||||||||||||
Net income per common share--diluted
|
$
|
0.48
|
$
|
(0.64
|
)
|
$
|
1.53
|
$
|
0.37
|
September 30,
|
||||||||
(Dollars in thousands, except per share data)
|
2020
|
2019
|
||||||
Tangible shareholders’ equity
|
||||||||
Total shareholders’ equity
|
$
|
105,230
|
$
|
100,615
|
||||
Less: Goodwill and other intangibles
|
(1,634
|
)
|
(1,840
|
)
|
||||
Tangible shareholders’ equity
|
$
|
103,596
|
$
|
98,775
|
||||
Tangible assets
|
||||||||
Total assets
|
$
|
973,354
|
$
|
826,349
|
||||
Less: Goodwill and other intangibles
|
(1,634
|
)
|
(1,840
|
)
|
||||
Tangible assets
|
$
|
971,720
|
$
|
824,509
|
||||
Tangible shareholders’ equity
|
||||||||
Tangible shareholders’ equity (numerator)
|
$
|
103,596
|
$
|
98,775
|
||||
Tangible assets (denominator)
|
$
|
971,720
|
$
|
824,509
|
||||
Tangible common equity to tangible assets
|
10.66
|
%
|
11.98
|
%
|
||||
End of period common shares outstanding
|
9,241,689
|
10,057,506
|
||||||
Book value per share
|
$
|
11.39
|
$
|
10.00
|
||||
Tangible book value per share
|
$
|
11.21
|
$
|
9.82
|
||||
Total shareholders’ equity to total assets
|
10.81
|
%
|
12.18
|
%
|
Net Interest Margin With Loan Fee Income
|
||||||||||||||||||||||||
For the Three Months Ended September 30,
|
||||||||||||||||||||||||
2020
|
2019
|
|||||||||||||||||||||||
Average
Balance
|
Interest
Income/
Expense
|
Average
Yield/
Rate
|
Average
Balance
|
Interest
Income/
Expense
|
Average
Yield/
Rate
|
|||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||
Interest-earning assets:
|
||||||||||||||||||||||||
Short-term investments(1)
|
$
|
111,019
|
$
|
147
|
0.53
|
%
|
$
|
145,147
|
$
|
888
|
2.43
|
%
|
||||||||||||
Investment securities(2)
|
1,138
|
2
|
0.70
|
1,069
|
4
|
1.48
|
||||||||||||||||||
Loans held for sale
|
425
|
—
|
0.00
|
265
|
—
|
0.00
|
||||||||||||||||||
Total loans(3)
|
847,076
|
12,777
|
6.00
|
651,186
|
12,179
|
7.42
|
||||||||||||||||||
Total interest-earning assets
|
959,658
|
12,926
|
5.36
|
797,667
|
13,071
|
6.50
|
||||||||||||||||||
Noninterest-earning assets
|
7,386
|
8,773
|
||||||||||||||||||||||
Total assets
|
$
|
967,044
|
$
|
806,440
|
||||||||||||||||||||
Funding sources:
|
||||||||||||||||||||||||
Interest-bearing liabilities:
|
||||||||||||||||||||||||
Deposits:
|
||||||||||||||||||||||||
Transaction accounts
|
$
|
381,572
|
545
|
0.57
|
%
|
$
|
287,241
|
1,234
|
1.70
|
%
|
||||||||||||||
Time deposits
|
200,961
|
780
|
1.54
|
220,935
|
1,237
|
2.22
|
||||||||||||||||||
Total interest-bearing deposits
|
582,533
|
1,325
|
0.90
|
508,176
|
2,471
|
1.93
|
||||||||||||||||||
Total interest-bearing liabilities
|
582,533
|
1,325
|
0.90
|
508,176
|
2,471
|
1.93
|
||||||||||||||||||
Noninterest-bearing liabilities:
|
||||||||||||||||||||||||
Noninterest-bearing deposits
|
276,219
|
193,785
|
||||||||||||||||||||||
Other noninterest-bearing liabilities
|
5,363
|
4,467
|
||||||||||||||||||||||
Total noninterest-bearing liabilities
|
281,582
|
198,252
|
||||||||||||||||||||||
Shareholders’ equity
|
102,929
|
100,012
|
||||||||||||||||||||||
Total liabilities and shareholders’ equity
|
$
|
967,044
|
$
|
806,440
|
||||||||||||||||||||
Net interest income including loan fee income
|
$
|
11,601
|
$
|
10,600
|
||||||||||||||||||||
Net interest spread including loan fee income(4)
|
4.45
|
%
|
4.57
|
%
|
||||||||||||||||||||
Net interest margin including loan fee income
|
4.81
|
%
|
5.27
|
%
|
(2) |
Includes income and average balances for FHLB and FRB stock.
|
(3) |
Non-accrual loans are included in loans.
|
(4) |
Net interest spread is the average yield on interest-earning assets minus the average rate on interest-bearing liabilities.
|
- |
Interest income on short term investments totaled $147,000 as compared to $888,000, a decrease of $741,000 or 83.4% which was attributable to a $34.1 million decrease, or 23.5%, in average balances of interest
bearing deposits at other financial institutions and a decrease in yield of 190 basis points, or 78.2%.
|
- |
Total interest income on loans, including loan fee income, increased $598,000 or 4.9% to $12.8 million which was attributable to a $195.9 million increase in average total loans to $847.1 million, as compared
with average loans of $651.2 million for the third quarter of 2019.
|
- |
Loan fees totaled $1.1 million, an increase of $237,000 or 28.2%.
|
- |
Yield on interest earning assets totaled 5.36%, a decrease of 114 basis points or 17.5%, compared to yield on interest earning assets of 6.50% for the third quarter of 2019; and
|
- |
Net interest margin for the third quarter of 2020 was 4.81% compared to 5.27% for the third quarter of 2019.
|
Net Interest Margin With Loan Fee Income
|
||||||||||||||||||||||||
For the Nine Months Ended September 30,
|
||||||||||||||||||||||||
2020
|
2019
|
|||||||||||||||||||||||
Average
Balance
|
Interest
Income/
Expense
|
Average
Yield/
Rate
|
Average
Balance
|
Interest
Income/
Expense
|
Average
Yield/
Rate
|
|||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||
Interest-earning assets:
|
||||||||||||||||||||||||
Short-term investments(1)
|
$
|
120,909
|
$
|
701
|
0.77
|
%
|
$
|
155,073
|
$
|
2,785
|
2.40
|
%
|
||||||||||||
Investment securities(2)
|
1,109
|
21
|
2.53
|
1,062
|
27
|
3.40
|
||||||||||||||||||
Loans held for sale
|
258
|
—
|
0.00
|
219
|
—
|
0.00
|
||||||||||||||||||
Total loans(3)
|
807,134
|
39,268
|
6.50
|
617,398
|
35,902
|
7.77
|
||||||||||||||||||
Total interest-earning assets
|
929,410
|
39,990
|
5.75
|
773,752
|
38,714
|
6.69
|
||||||||||||||||||
Noninterest-earning assets
|
8,439
|
8,942
|
||||||||||||||||||||||
Total assets
|
$
|
937,849
|
$
|
782,694
|
||||||||||||||||||||
Funding sources:
|
||||||||||||||||||||||||
Interest-bearing liabilities:
|
||||||||||||||||||||||||
Deposits:
|
||||||||||||||||||||||||
Transaction accounts
|
$
|
366,162
|
2,259
|
0.82
|
%
|
$
|
289,306
|
3,924
|
1.81
|
%
|
||||||||||||||
Time deposits
|
208,650
|
2,769
|
1.77
|
206,575
|
3,254
|
2.11
|
||||||||||||||||||
Total interest-bearing deposits
|
574,812
|
5,028
|
1.17
|
495,881
|
7,178
|
1.94
|
||||||||||||||||||
Total interest-bearing liabilities
|
574,812
|
5,028
|
1.17
|
495,881
|
7,178
|
1.94
|
||||||||||||||||||
Noninterest-bearing liabilities:
|
||||||||||||||||||||||||
Noninterest-bearing deposits
|
256,429
|
186,379
|
||||||||||||||||||||||
Other noninterest-bearing liabilities
|
5,231
|
4,779
|
||||||||||||||||||||||
Total noninterest-bearing liabilities
|
261,660
|
191,158
|
||||||||||||||||||||||
Shareholders’ equity
|
101,377
|
95,655
|
||||||||||||||||||||||
Total liabilities and shareholders’ equity
|
$
|
937,849
|
$
|
782,694
|
||||||||||||||||||||
Net interest income including loan fee income
|
$
|
34,962
|
$
|
31,536
|
||||||||||||||||||||
Net interest spread including loan fee income(4)
|
4.58
|
%
|
4.75
|
%
|
||||||||||||||||||||
Net interest margin including loan fee income
|
5.02
|
%
|
5.45
|
%
|
(2) |
Includes income and average balances for FHLB and FRB stock.
|
(3) |
Non-accrual loans are included in loans.
|
(4) |
Net interest spread is the average yield on interest-earning assets minus the average rate on interest-bearing liabilities.
|
- |
Interest income on short term investments totaled $701,000 as compared to $2.8 million, a decrease of $2.1 million or 74.8% which was attributable to a $34.2 million decrease, or 22.0%, in average balances of
interest bearing deposits at other financial institutions and a decrease in yield of 163 basis points, or 67.9%.
|
- |
Total interest income on loans, including loan fee income, increased $3.4 million or 9.4% to $39.3 million which was attributable to a $189.7 million increase in average total loans to $807.1 million, as
compared with average total loans of $617.4 million for the third quarter of 2019.
|
- |
Loan fees totaled $4.0 million, an increase of $471,000 or 13.5%.
|
- |
Yield on interest earning assets totaled 5.75%, a decrease of 94 basis points or 14.1%, compared to yield on interest earning assets of 6.69% for the same period in 2019; and
|
- |
Net interest margin for the first nine months of 2020 was 5.02% compared to 5.45% for the same period in 2019.
|
Net Interest Margin Excluding Loan Fee Income
|
||||||||||||||||||||||||
For the Three Months Ended September 30,
|
||||||||||||||||||||||||
2020
|
2019
|
|||||||||||||||||||||||
Average
Balance
|
Interest
Income/
Expense
|
Average
Yield/
Rate
|
Average
Balance
|
Interest
Income/
Expense
|
Average
Yield/
Rate
|
|||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||
Interest-earning assets:
|
||||||||||||||||||||||||
Short-term investments(1)
|
$
|
111,019
|
$
|
147
|
0.53
|
%
|
$
|
145,147
|
$
|
888
|
2.43
|
%
|
||||||||||||
Investment securities(2)
|
1,138
|
2
|
0.70
|
1,069
|
4
|
1.48
|
||||||||||||||||||
Loans held for sale
|
425
|
—
|
0.00
|
265
|
—
|
0.00
|
||||||||||||||||||
Total loans(3)
|
847,076
|
11,699
|
5.49
|
651,186
|
11,338
|
6.91
|
||||||||||||||||||
Total interest-earning assets
|
959,658
|
11,848
|
4.91
|
797,667
|
12,230
|
6.08
|
||||||||||||||||||
Noninterest-earning assets
|
7,386
|
8,773
|
||||||||||||||||||||||
Total assets
|
$
|
967,044
|
$
|
806,440
|
||||||||||||||||||||
Funding sources:
|
||||||||||||||||||||||||
Interest-bearing liabilities:
|
||||||||||||||||||||||||
Deposits:
|
||||||||||||||||||||||||
Transaction accounts
|
$
|
381,572
|
545
|
0.57
|
%
|
$
|
287,241
|
1,234
|
1.70
|
%
|
||||||||||||||
Time deposits
|
200,961
|
780
|
1.54
|
220,935
|
1,237
|
2.22
|
||||||||||||||||||
Total interest-bearing deposits
|
582,533
|
1,325
|
0.90
|
508,176
|
2,471
|
1.93
|
||||||||||||||||||
Total interest-bearing liabilities
|
582,533
|
1,325
|
0.90
|
508,176
|
2,471
|
1.93
|
||||||||||||||||||
Noninterest-bearing liabilities:
|
||||||||||||||||||||||||
Noninterest-bearing deposits
|
276,219
|
193,785
|
||||||||||||||||||||||
Other noninterest-bearing liabilities
|
5,363
|
4,467
|
||||||||||||||||||||||
Total noninterest-bearing liabilities
|
281,582
|
198,252
|
||||||||||||||||||||||
Shareholders’ equity
|
102,929
|
100,012
|
||||||||||||||||||||||
Total liabilities and shareholders’ equity
|
$
|
967,044
|
$
|
806,440
|
||||||||||||||||||||
Net interest income excluding loan fee income
|
$
|
10,523
|
$
|
9,579
|
||||||||||||||||||||
Net interest spread excluding loan fee income(4)
|
4.01
|
%
|
4.15
|
%
|
||||||||||||||||||||
Net interest margin excluding loan fee income
|
4.36
|
%
|
4.85
|
%
|
(1) |
Includes income and average balances for fed funds sold, interest-earning deposits in banks and other miscellaneous interest-earning assets.
|
(2) |
Includes income and average balances for FHLB and FRB stock.
|
(3) |
Non-accrual loans are included in loans.
|
(4) |
Net interest spread is the average yield on interest-earning assets minus the average rate on interest-bearing liabilities.
|
- |
Interest income on short term investments totaled $147,000 as compared to $888,000, a decrease of $741,000 or 83.4% which was attributable to a $34.1 million decrease, or 23.5%, in average balances of interest
bearing deposits at other financial institutions and a decrease in yield of 190 basis points, or 78.2%.
|
- |
Total interest income on loans, excluding loan fee income, increased $361,000 or 3.2% to $11.7 million which was attributable to a $195.9 million increase in average total loans to $847.1 million as compared
with average total loans of $651.2 million for the third quarter of 2019.
|
- |
Yield on interest-earning assets, excluding loan fee income, totaled 4.91%, a decrease of 117 basis points or 19.2%, compared to yield on interest-earning assets excluding fee income of 6.08% for the third
quarter of 2019, and
|
- |
Net interest margin, excluding loan fee income, totaled 4.36%, a decrease of 49 basis points or 10.1%, compared to net interest margin excluding loan fee income of 4.85% for the third quarter of 2019.
|
Net Interest Margin Excluding Loan Fee Income
|
||||||||||||||||||||||||
For the Nine Months Ended September 30,
|
||||||||||||||||||||||||
2020
|
2019
|
|||||||||||||||||||||||
Average
Balance
|
Interest
Income/
Expense
|
Average
Yield/
Rate
|
Average
Balance
|
Interest
Income/
Expense
|
Average
Yield/
Rate
|
|||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||
Interest-earning assets:
|
||||||||||||||||||||||||
Short-term investments(1)
|
$
|
120,909
|
$
|
701
|
0.77
|
%
|
$
|
155,073
|
$
|
2,785
|
2.40
|
%
|
||||||||||||
Investment securities(2)
|
1,109
|
21
|
2.53
|
1,062
|
27
|
3.40
|
||||||||||||||||||
Loans held for sale
|
258
|
—
|
0.00
|
219
|
—
|
0.00
|
||||||||||||||||||
Total loans(3)
|
807,134
|
35,299
|
5.84
|
617,398
|
32,404
|
7.02
|
||||||||||||||||||
Total interest-earning assets
|
929,410
|
36,021
|
5.18
|
773,752
|
35,216
|
6.09
|
||||||||||||||||||
Noninterest-earning assets
|
8,439
|
8,942
|
||||||||||||||||||||||
Total assets
|
$
|
937,849
|
$
|
782,694
|
||||||||||||||||||||
Funding sources:
|
||||||||||||||||||||||||
Interest-bearing liabilities:
|
||||||||||||||||||||||||
Deposits:
|
||||||||||||||||||||||||
Transaction accounts
|
$
|
366,162
|
2,259
|
0.82
|
%
|
$
|
289,306
|
3,924
|
1.81
|
%
|
||||||||||||||
Time deposits
|
208,650
|
2,769
|
1.77
|
206,575
|
3,254
|
2.11
|
||||||||||||||||||
Total interest-bearing deposits
|
574,812
|
5,028
|
1.17
|
495,881
|
7,178
|
1.94
|
||||||||||||||||||
Total interest-bearing liabilities
|
574,812
|
5,028
|
1.17
|
495,881
|
7,178
|
1.94
|
||||||||||||||||||
Noninterest-bearing liabilities:
|
||||||||||||||||||||||||
Noninterest-bearing deposits
|
256,429
|
186,379
|
||||||||||||||||||||||
Other noninterest-bearing liabilities
|
5,231
|
4,779
|
||||||||||||||||||||||
Total noninterest-bearing liabilities
|
261,660
|
191,158
|
||||||||||||||||||||||
Shareholders’ equity
|
101,377
|
95,655
|
||||||||||||||||||||||
Total liabilities and shareholders’ equity
|
$
|
937,849
|
$
|
782,694
|
||||||||||||||||||||
Net interest income excluding loan fee income
|
$
|
30,993
|
$
|
28,038
|
||||||||||||||||||||
Net interest spread excluding loan fee income(4)
|
4.01
|
%
|
4.15
|
%
|
||||||||||||||||||||
Net interest margin excluding loan fee income
|
4.45
|
%
|
4.84
|
%
|
(1) |
Includes income and average balances for fed funds sold, interest-earning deposits in banks and other miscellaneous interest-earning assets.
|
(2) |
Includes income and average balances for FHLB and FRB stock.
|
(3) |
Non-accrual loans are included in loans.
|
(4) |
Net interest spread is the average yield on interest-earning assets minus the average rate on interest-bearing liabilities.
|
- |
Interest income on short term investments totaled $701,000 as compared to $2.8 million, a decrease of $2.1 million or 74.8% which was attributable to a $34.2 million decrease, or 22.0%, in average balances of
interest bearing deposits at other financial institutions and a decrease in yield of 163 basis points, or 67.9%.
|
- |
Total interest income on loans, excluding loan fee income, increased $2.9 million or 8.9% to $35.3 million which was attributable to a $189.7 million increase in average total loans to $807.1 million as
compared with the average total loans of $617.4 million for the third quarter of 2019.
|
- |
Yield on interest-earning assets, excluding loan fee income, totaled 5.18%, a decrease of 91 basis points or 14.9%, compared to yield on interest-earning assets excluding fee income of 6.09% for the same period
in 2019; and
|
- |
Net interest margin, excluding loan fee income, for the first nine months of 2020 was 4.45% compared to 4.84% for the same period in 2019.
|
Analysis of Changes in Interest Income and
Expenses Including Loan Fee Income
|
||||||||||||
For the Three Months Ended
September 30, 2020 over 2019
|
||||||||||||
Change due to:
|
||||||||||||
Volume(1)
|
Rate(1)
|
Interest
Variance
|
||||||||||
(Dollars in thousands)
|
||||||||||||
Increase (decrease) in interest income:
|
||||||||||||
Short-term investments
|
$
|
(208
|
)
|
$
|
(533
|
)
|
$
|
(741
|
)
|
|||
Investment securities
|
-
|
(2
|
)
|
(2
|
)
|
|||||||
Total loans
|
3,654
|
(3,056
|
)
|
598
|
||||||||
Total increase in interest income
|
3,446
|
(3,591
|
)
|
(145
|
)
|
|||||||
Increase (decrease) in interest expense:
|
||||||||||||
Deposits
|
||||||||||||
Transaction accounts
|
404
|
(1,093
|
)
|
(689
|
)
|
|||||||
Time deposits
|
(112
|
)
|
(345
|
)
|
(457
|
)
|
||||||
Total interest-bearing deposits
|
293
|
(1,439
|
)
|
(1,146
|
)
|
|||||||
Total increase in interest expense
|
293
|
(1,439
|
)
|
(1,146
|
)
|
|||||||
Increase (Decrease) in net interest income
|
$
|
3,153
|
$
|
(2,152
|
)
|
$
|
1,001
|
Analysis of Changes in Interest Income and
Expenses Including Loan Fee Income
|
||||||||||||
For the Nine Months Ended
September 30, 2020 over 2019
|
||||||||||||
Change due to:
|
||||||||||||
Volume(1)
|
Rate(1)
|
Interest
Variance
|
||||||||||
(Dollars in thousands)
|
||||||||||||
Increase (decrease) in interest income:
|
||||||||||||
Short-term investments
|
$
|
(1,096
|
)
|
$
|
(988
|
)
|
$
|
(2,084
|
)
|
|||
Investment securities
|
2
|
(8
|
)
|
(6
|
)
|
|||||||
Total loans
|
19,704
|
(16,338
|
)
|
3,366
|
||||||||
Total increase in interest income
|
18,611
|
(17,335
|
)
|
1,276
|
||||||||
Increase (decrease) in interest expense:
|
||||||||||||
Deposits
|
||||||||||||
Transaction accounts
|
1,862
|
(3,527
|
)
|
(1,665
|
)
|
|||||||
Time deposits
|
58
|
(543
|
)
|
(485
|
)
|
|||||||
Total interest-bearing deposits
|
1,920
|
(4,070
|
)
|
(2,150
|
)
|
|||||||
Total increase in interest expense
|
1,920
|
(4,070
|
)
|
(2,150
|
)
|
|||||||
Increase (Decrease) in net interest income
|
$
|
16,691
|
$
|
(13,265
|
)
|
$
|
3,426
|
(1) |
Variances attributable to both volume and rate are allocated on a consistent basis between rate and volume based on the absolute value of the variances in each category.
|
For the Three Months Ended
September 30,
|
||||||||||||||||
2020
|
2019
|
$ Increase
(Decrease)
|
% Increase
(Decrease)
|
|||||||||||||
(Dollars in thousands)
|
||||||||||||||||
Noninterest income:
|
||||||||||||||||
Secondary market income
|
$
|
57
|
$
|
69
|
$
|
(12
|
)
|
-17.39
|
%
|
|||||||
Service charges on deposit accounts
|
104
|
110
|
(6
|
)
|
-5.45
|
|||||||||||
Other income and fees
|
173
|
330
|
(157
|
)
|
-47.58
|
|||||||||||
Total noninterest income
|
$
|
334
|
$
|
509
|
$
|
(175
|
)
|
-34.38
|
%
|
For the Nine Months Ended
September 30,
|
||||||||||||||||
2020
|
2019
|
$ Increase
(Decrease)
|
% Increase
(Decrease)
|
|||||||||||||
(Dollars in thousands)
|
||||||||||||||||
Noninterest income:
|
||||||||||||||||
Secondary market income
|
$
|
134
|
$
|
146
|
$
|
(12
|
)
|
-8.22
|
%
|
|||||||
Service charges on deposit accounts
|
318
|
279
|
39
|
13.98
|
||||||||||||
Other income and fees
|
513
|
602
|
(89
|
)
|
-14.78
|
|||||||||||
Total noninterest income
|
$
|
965
|
$
|
1,027
|
$
|
(62
|
)
|
-6.04
|
%
|
For the Three Months Ended
September 30,
|
||||||||||||||||
2020
|
2019
|
$ Increase
(Decrease)
|
% Increase
(Decrease)
|
|||||||||||||
(Dollars in thousands)
|
||||||||||||||||
Noninterest expense:
|
||||||||||||||||
Salaries and employee benefits
|
$
|
2,505
|
$
|
14,256
|
$
|
(11,751
|
)
|
(82.43
|
)%
|
|||||||
Furniture and equipment
|
224
|
229
|
(5
|
)
|
(2.18
|
)
|
||||||||||
Occupancy
|
543
|
436
|
107
|
24.54
|
||||||||||||
Data and item processing
|
276
|
276
|
-
|
-
|
||||||||||||
Accounting, marketing, and legal fees
|
135
|
218
|
(83
|
)
|
(38.07
|
)
|
||||||||||
Regulatory assessments
|
164
|
31
|
133
|
429.03
|
||||||||||||
Advertising and public relations
|
62
|
71
|
(9
|
)
|
(12.68
|
)
|
||||||||||
Travel, lodging and entertainment
|
50
|
153
|
(103
|
)
|
(67.32
|
)
|
||||||||||
Other expense
|
625
|
402
|
223
|
55.47
|
||||||||||||
Total noninterest expense
|
$
|
4,584
|
$
|
16,072
|
$
|
(11,488
|
)
|
(71.48
|
)%
|
For the Nine Months Ended
September 30,
|
||||||||||||||||
2020
|
2019
|
$ Increase
(Decrease)
|
% Increase
(Decrease)
|
|||||||||||||
(Dollars in thousands)
|
||||||||||||||||
Noninterest expense:
|
||||||||||||||||
Salaries and employee benefits
|
$
|
7,576
|
$
|
18,792
|
$
|
(11,216
|
)
|
(59.68
|
)%
|
|||||||
Furniture and equipment
|
658
|
606
|
52
|
8.58
|
||||||||||||
Occupancy
|
1,417
|
1,157
|
260
|
22.47
|
||||||||||||
Data and item processing
|
821
|
814
|
7
|
0.86
|
||||||||||||
Accounting, marketing, and legal fees
|
338
|
507
|
(169
|
)
|
(33.33
|
)
|
||||||||||
Regulatory assessments
|
281
|
94
|
187
|
198.94
|
||||||||||||
Advertising and public relations
|
360
|
349
|
11
|
3.15
|
||||||||||||
Travel, lodging and entertainment
|
146
|
287
|
(141
|
)
|
(49.13
|
)
|
||||||||||
Other expense
|
1,463
|
1,269
|
194
|
15.29
|
||||||||||||
Total noninterest expense
|
$
|
13,060
|
$
|
23,875
|
$
|
(10,815
|
)
|
(45.30
|
)%
|
As of September 30,
|
As of December 31,
|
|||||||||||||||
2020
|
2019
|
|||||||||||||||
Amount
|
% of Total
|
Amount
|
% of Total
|
|||||||||||||
(Dollars in thousands)
|
||||||||||||||||
Construction & development
|
$
|
108,453
|
12.3
|
%
|
$
|
70,628
|
10.0
|
%
|
||||||||
1-4 family real estate
|
31,113
|
3.5
|
34,160
|
4.8
|
||||||||||||
Commercial real estate – other
|
282,447
|
32.0
|
273,278
|
38.5
|
||||||||||||
Total commercial real estate
|
422,013
|
47.8
|
378,066
|
53.3
|
||||||||||||
Commercial & industrial
|
400,378
|
45.3
|
260,762
|
36.8
|
||||||||||||
Agricultural
|
50,578
|
5.7
|
57,945
|
8.2
|
||||||||||||
Consumer
|
10,253
|
1.2
|
11,895
|
1.7
|
||||||||||||
Gross loans
|
883,222
|
100.0
|
%
|
708,668
|
100.0
|
%
|
||||||||||
Less unearned income, net
|
(2,643
|
)
|
(1,364
|
)
|
||||||||||||
Total loans
|
880,579
|
707,304
|
||||||||||||||
Allowance for loan and lease losses
|
(11,131
|
)
|
(7,846
|
)
|
||||||||||||
Net loans
|
$
|
869,448
|
$
|
699,458
|
As of September 30, 2020
|
||||||||||||||||||||||||||||
Due in One Year or Less
|
Due after One Year
Through Five Years
|
Due after Five Years
|
||||||||||||||||||||||||||
Fixed
Rate
|
Adjustable
Rate
|
Fixed
Rate
|
Adjustable
Rate
|
Fixed
Rate
|
Adjustable
Rate
|
Total
|
||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||
Construction & development
|
$
|
29
|
$
|
52,952
|
$
|
872
|
$
|
54,173
|
$
|
—
|
$
|
427
|
$
|
108,453
|
||||||||||||||
1-4 family commercial
|
116
|
15,471
|
5,121
|
9,691
|
40
|
674
|
31,113
|
|||||||||||||||||||||
Commercial real estate – other
|
876
|
53,982
|
48,216
|
174,398
|
312
|
4,663
|
282,447
|
|||||||||||||||||||||
Total commercial real estate
|
1,021
|
122,405
|
54,209
|
238,262
|
352
|
5,764
|
422,013
|
|||||||||||||||||||||
Commercial & industrial
|
27,236
|
181,286
|
28,209
|
157,104
|
11
|
6,532
|
400,378
|
|||||||||||||||||||||
Agricultural
|
5,358
|
29,863
|
2,811
|
11,149
|
62
|
1,335
|
50,578
|
|||||||||||||||||||||
Consumer
|
2,019
|
153
|
6,524
|
75
|
1,054
|
428
|
10,253
|
|||||||||||||||||||||
Gross loans
|
$
|
35,634
|
$
|
333,707
|
$
|
91,753
|
$
|
406,590
|
$
|
1,479
|
$
|
14,059
|
$
|
883,222
|
As of December 31, 2019
|
||||||||||||||||||||||||||||
Due in One Year or Less
|
Due after One Year
Through Five Years
|
Due after Five Years
|
||||||||||||||||||||||||||
Fixed
Rate
|
Adjustable
Rate
|
Fixed
Rate
|
Adjustable
Rate
|
Fixed
Rate
|
Adjustable
Rate
|
Total
|
||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||
Construction & development
|
$
|
—
|
$
|
31,860
|
$
|
833
|
$
|
37,483
|
$
|
—
|
$
|
452
|
$
|
70,628
|
||||||||||||||
1-4 family real estate
|
282
|
9,598
|
3,843
|
19,676
|
43
|
718
|
34,160
|
|||||||||||||||||||||
Commercial real estate - other
|
1,849
|
23,533
|
23,194
|
219,390
|
335
|
4,977
|
273,278
|
|||||||||||||||||||||
Total real estate
|
2,131
|
64,991
|
27,870
|
276,549
|
378
|
6,147
|
378,066
|
|||||||||||||||||||||
Commercial & industrial
|
11,677
|
176,329
|
9,973
|
54,233
|
12
|
8,538
|
260,762
|
|||||||||||||||||||||
Agricultural
|
3,947
|
34,875
|
2,786
|
13,055
|
1,319
|
1,963
|
57,945
|
|||||||||||||||||||||
Consumer
|
2,042
|
—
|
4,824
|
159
|
4,047
|
823
|
11,895
|
|||||||||||||||||||||
Gross loans
|
$
|
19,797
|
$
|
276,195
|
$
|
45,453
|
$
|
343,996
|
$
|
5,756
|
$
|
17,471
|
$
|
708,668
|
For the Nine Months Ended
|
||||||||
September 30,
2020
|
December 31,
2019
|
|||||||
(Dollars in thousands)
|
||||||||
Balance at beginning of the period
|
$
|
7,846
|
$
|
7,832
|
||||
Provision for loan losses
|
3,300
|
—
|
||||||
Charge-offs:
|
||||||||
Construction & development
|
—
|
—
|
||||||
1-4 family commercial
|
—
|
(2
|
)
|
|||||
Commercial real estate – other
|
—
|
—
|
||||||
Commercial & industrial
|
(39
|
)
|
(4
|
)
|
||||
Agricultural
|
—
|
(11
|
)
|
|||||
Consumer
|
(1
|
)
|
(1
|
)
|
||||
Total charge-offs
|
(40
|
)
|
(18
|
)
|
||||
Recoveries:
|
||||||||
Construction & development
|
—
|
—
|
||||||
1-4 family commercial
|
2
|
5
|
||||||
Commercial real estate – other
|
—
|
—
|
||||||
Commercial & industrial
|
13
|
24
|
||||||
Agricultural
|
10
|
3
|
||||||
Consumer
|
—
|
—
|
||||||
Total recoveries
|
25
|
32
|
||||||
Net recoveries (charge-offs)
|
(15
|
)
|
14
|
|||||
Balance at end of the period
|
$
|
11,131
|
$
|
7,846
|
As of September 30,
|
As of December 31,
|
|||||||||||||||
2020
|
2019
|
|||||||||||||||
Amount
|
Percent
|
Amount
|
Percent
|
|||||||||||||
(Dollars in thousands)
|
||||||||||||||||
Construction & development
|
$
|
1,367
|
12.28
|
%
|
$
|
782
|
9.97
|
%
|
||||||||
1-4 family commercial
|
392
|
3.52
|
378
|
4.82
|
||||||||||||
Commercial real estate - other
|
3,560
|
31.98
|
3,025
|
38.55
|
||||||||||||
Commercial & industrial
|
5,046
|
45.33
|
2,887
|
36.80
|
||||||||||||
Agricultural
|
637
|
5.73
|
642
|
8.18
|
||||||||||||
Consumer
|
129
|
1.16
|
132
|
1.68
|
||||||||||||
Total
|
$
|
11,131
|
100.0
|
%
|
$
|
7,846
|
100.0
|
%
|
As of
September 30,
|
As of
December
31,
|
|||||||
2020
|
2019
|
|||||||
(Dollars in thousands)
|
||||||||
Nonaccrual loans
|
$
|
20,515
|
$
|
1,809
|
||||
Troubled debt restructurings (1)
|
—
|
912
|
||||||
Accruing loans 90 or more days past due
|
—
|
612
|
||||||
Total nonperforming loans
|
20,515
|
3,333
|
||||||
Other real estate owned
|
—
|
—
|
||||||
Total nonperforming assets
|
$
|
20,515
|
$
|
3,333
|
||||
Ratio of nonperforming loans to total loans
|
2.33
|
%
|
0.47
|
%
|
||||
Ratio of nonperforming assets to total assets
|
2.11
|
%
|
0.38
|
%
|
(1) |
$1.66 million and $1.81 million of TDRs as of September 30, 2020 and December 31, 2019, respectively, are included in the nonaccrual loans balance in the line above
|
As of September 30, 2020
|
||||||||||||||||||||||||||||
Loans
30-59 days
past due
|
Loans
60-89 days
past due
|
Loans
90+ days
past due
|
Total
Loans 90+
days and
accruing
|
Total past
due
Loans
|
Current
|
Gross
Loans
|
||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||
Construction & development
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
108,453
|
$
|
108,453
|
||||||||||||||
1-4 family commercial
|
—
|
—
|
—
|
—
|
—
|
31,113
|
31,113
|
|||||||||||||||||||||
Commercial real estate - other
|
—
|
1,957
|
—
|
—
|
1,957
|
280,490
|
282,447
|
|||||||||||||||||||||
Commercial & industrial
|
920
|
7,071
|
—
|
—
|
7,991
|
392,387
|
400,378
|
|||||||||||||||||||||
Agricultural
|
—
|
1,948
|
—
|
—
|
1,948
|
48,630
|
50,578
|
|||||||||||||||||||||
Consumer
|
—
|
—
|
—
|
—
|
—
|
10,253
|
10,253
|
|||||||||||||||||||||
Total
|
$
|
920
|
$
|
10,976
|
$
|
—
|
$
|
—
|
$
|
11,896
|
$
|
871,326
|
$
|
883,222
|
As of December 31, 2019
|
||||||||||||||||||||||||||||
Loans
30-59 days
past due
|
Loans
60-89 days
past due
|
Loans
90+ days
past due
|
Total
Loans 90+
days and
accruing
|
Total past
due
Loans
|
Current
|
Gross
Loans
|
||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||
Construction & development
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
70,628
|
$
|
70,628
|
||||||||||||||
1-4 family commercial
|
—
|
—
|
—
|
—
|
—
|
34,160
|
34,160
|
|||||||||||||||||||||
Commercial real estate – other
|
—
|
—
|
—
|
—
|
—
|
273,278
|
273,278
|
|||||||||||||||||||||
Commercial & industrial
|
—
|
—
|
14
|
14
|
14
|
260,748
|
260,762
|
|||||||||||||||||||||
Agricultural
|
—
|
—
|
598
|
598
|
598
|
57,347
|
57,945
|
|||||||||||||||||||||
Consumer
|
90
|
—
|
—
|
—
|
90
|
11,805
|
11,895
|
|||||||||||||||||||||
Total
|
$
|
90
|
$
|
—
|
$
|
612
|
$
|
612
|
$
|
702
|
$
|
707,966
|
$
|
708,668
|
As of September 30, 2020
|
||||||||||||||||||||
Pass
|
Watch
|
Special mention
|
Substandard
|
Total
|
||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||
Construction & development
|
$
|
108,453
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
108,453
|
||||||||||
1-4 family commercial
|
29,209
|
776
|
—
|
1,128
|
31,113
|
|||||||||||||||
Commercial real estate – other
|
264,337
|
9,988
|
2,998
|
5,124
|
282,447
|
|||||||||||||||
Commercial & industrial
|
352,477
|
11,662
|
9,958
|
26,281
|
400,378
|
|||||||||||||||
Agricultural
|
48,630
|
—
|
—
|
1,948
|
50,578
|
|||||||||||||||
Consumer
|
10,253
|
—
|
—
|
—
|
10,253
|
|||||||||||||||
Total
|
$
|
813,359
|
$
|
22,426
|
$
|
12,956
|
$
|
34,481
|
$
|
883,222
|
As of December 31, 2019
|
||||||||||||||||||||
Pass
|
Watch
|
Special mention
|
Substandard
|
Total
|
||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||
Construction & development
|
$
|
70,628
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
70,628
|
||||||||||
1-4 family commercial
|
33,622
|
538
|
—
|
—
|
34,160
|
|||||||||||||||
Commercial real estate – other
|
267,437
|
—
|
—
|
5,841
|
273,278
|
|||||||||||||||
Commercial & industrial
|
241,176
|
5,312
|
11,524
|
2,750
|
260,762
|
|||||||||||||||
Agricultural
|
53,290
|
—
|
2,128
|
2,527
|
57,945
|
|||||||||||||||
Consumer
|
11,895
|
—
|
—
|
—
|
11,895
|
|||||||||||||||
Total
|
$
|
678,048
|
$
|
5,850
|
$
|
13,652
|
$
|
11,118
|
$
|
708,668
|
As of September 30, 2020
|
||||||||||||||||
Number of
Contracts
|
Pre-Modification
Outstanding
Recorded Investment
|
Post-Modification
Outstanding
Recorded Investment
|
Specific Reserves
Allocated
|
|||||||||||||
(Dollars in thousands)
|
||||||||||||||||
Commercial real estate – other
|
1
|
$
|
1,656
|
$
|
1,656
|
$
|
26
|
|||||||||
Total
|
1
|
$
|
1,656
|
$
|
1,656
|
$
|
26
|
As of December 31, 2019
|
||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||
Commercial & industrial
|
1
|
$
|
1,809
|
$
|
1,809
|
$
|
26
|
|||||||||
Agricultural
|
2
|
912
|
912
|
—
|
||||||||||||
Total
|
3
|
$
|
2,721
|
$
|
2,721
|
$
|
26
|
As of September 30, 2020
|
As of December 31, 2019
|
|||||||||||||||
Number of
Contracts
|
Amount
|
Number of
Contracts
|
Amount
|
|||||||||||||
(Dollars in thousands)
|
||||||||||||||||
Accrual
|
—
|
$
|
—
|
2
|
$
|
912
|
||||||||||
Nonaccrual
|
1
|
1,656
|
1
|
1,809
|
||||||||||||
Total
|
1
|
$
|
1,656
|
3
|
$
|
2,721
|
As of September 30,
|
As of December 31,
|
|||||||||||||||
2020
|
2019
|
|||||||||||||||
Amount
|
Percentage
of
Total
|
Amount
|
Percentage
of
Total
|
|||||||||||||
(Dollars in thousands)
|
||||||||||||||||
Noninterest-bearing demand
|
$
|
272,008
|
31.5
|
%
|
$
|
219,221
|
29.0
|
%
|
||||||||
Interest-bearing:
|
||||||||||||||||
NOW deposits
|
177,366
|
20.6
|
112,420
|
14.8
|
||||||||||||
Money market
|
172,852
|
20.0
|
150,554
|
19.9
|
||||||||||||
Savings deposits
|
57,928
|
6.7
|
72,750
|
9.6
|
||||||||||||
Time deposits (more than $100,000)
|
159,079
|
18.4
|
173,898
|
22.9
|
||||||||||||
Time deposits ($100,000 or less)
|
24,436
|
2.8
|
28,640
|
3.8
|
||||||||||||
Total interest-bearing
|
591,661
|
68.5
|
538,262
|
71.0
|
||||||||||||
Total deposits
|
$
|
863,669
|
100.0
|
%
|
$
|
757,483
|
100.0
|
%
|
For the Nine Months Ended
September 30,
|
For the Year Ended
December 31,
|
|||||||||||||||
2020
|
2019
|
|||||||||||||||
Average
Balance
|
Weighted
Average
Rate
|
Average
Balance
|
Weighted
Average
Rate
|
|||||||||||||
(Dollars in thousands)
|
||||||||||||||||
Noninterest-bearing demand
|
$
|
256,429
|
0.00
|
%
|
$
|
192,562
|
0.00
|
%
|
||||||||
Interest-bearing:
|
||||||||||||||||
NOW
|
153,653
|
0.89
|
95,694
|
1.83
|
||||||||||||
Money market
|
152,092
|
0.84
|
132,265
|
1.83
|
||||||||||||
Savings
|
60,417
|
0.63
|
67,617
|
1.30
|
||||||||||||
Time
|
208,650
|
1.77
|
208,375
|
2.14
|
||||||||||||
Total interest-bearing
|
574,812
|
1.17
|
503,951
|
1.89
|
||||||||||||
Total deposits
|
$
|
831,241
|
0.81
|
%
|
$
|
696,513
|
1.37
|
%
|
As of September 30, 2020 Maturity Within:
|
||||||||||||||||||||
Three Months
|
Three to
Six Months
|
Six to
12 Months
|
After
12 Months
|
Total
|
||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||
Time deposits ($100,000 or less)
|
$
|
4,436
|
$
|
6,791
|
$
|
8,407
|
$
|
7,902
|
$
|
27,536
|
||||||||||
Time deposits (more than $100,000)
|
29,764
|
34,022
|
55,497
|
36,696
|
155,979
|
|||||||||||||||
Total time deposits
|
$
|
34,200
|
$
|
40,813
|
$
|
63,904
|
$
|
44,598
|
$
|
183,515
|
As of December 31, 2019 Maturity Within:
|
||||||||||||||||||||
Three Months
|
Three to
Six Months
|
Six to
12 Months
|
After
12 Months
|
Total
|
||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||
Time deposits ($100,000 or less)
|
$
|
6,998
|
$
|
5,024
|
$
|
8,387
|
$
|
8,231
|
$
|
28,640
|
||||||||||
Time deposits (more than $100,000)
|
52,048
|
34,126
|
49,700
|
38,024
|
173,898
|
|||||||||||||||
Total time deposits
|
$
|
59,046
|
$
|
39,150
|
$
|
58,087
|
$
|
46,255
|
$
|
202,538
|
Actual
|
With
Capital Conservation
Buffer
|
Minimum
To be Considered
“Well-Capitalized”
|
||||||||||||||||||||||
Amount
|
Ratio
|
Amount
|
Ratio
|
Amount
|
Ratio
|
|||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||
As of September 30, 2020:
|
||||||||||||||||||||||||
Total capital to risk-weighted assets
|
||||||||||||||||||||||||
Company
|
$
|
113,695
|
14.09
|
%
|
$
|
84,723
|
10.50
|
%
|
N/A
|
N/A
|
||||||||||||||
Bank
|
113,640
|
14.10
|
84,615
|
10.50
|
80,586
|
10.00
|
%
|
|||||||||||||||||
Tier 1 capital to risk-weighted assets
|
||||||||||||||||||||||||
Company
|
103,596
|
12.84
|
68,585
|
8.50
|
N/A
|
N/A
|
||||||||||||||||||
Bank
|
103,554
|
12.85
|
68,498
|
8.50
|
64,469
|
8.00
|
||||||||||||||||||
CET 1 capital to risk-weighted assets
|
||||||||||||||||||||||||
Company
|
103,596
|
12.84
|
56,482
|
7.00
|
N/A
|
N/A
|
||||||||||||||||||
Bank
|
103,554
|
12.85
|
56,410
|
7.00
|
52,381
|
6.50
|
||||||||||||||||||
Tier 1 leverage ratio
|
||||||||||||||||||||||||
Company
|
103,596
|
10.72
|
N/A
|
N/A
|
N/A
|
N/A
|
||||||||||||||||||
Bank
|
103,554
|
10.72
|
N/A
|
N/A
|
48,289
|
5.00
|
Actual
|
With
Capital Conservation
Buffer
|
Minimum
To be Considered
“Well-Capitalized”
|
||||||||||||||||||||||
Amount
|
Ratio
|
Amount
|
Ratio
|
Amount
|
Ratio
|
|||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||
As of December 31, 2019:
|
||||||||||||||||||||||||
Total capital to risk-weighted assets
|
||||||||||||||||||||||||
Company
|
$
|
105,137
|
15.25
|
%
|
$
|
72,393
|
10.50
|
%
|
N/A
|
N/A
|
||||||||||||||
Bank
|
106,148
|
15.42
|
72,287
|
10.50
|
68,845
|
10.00
|
%
|
|||||||||||||||||
Tier 1 capital to risk-weighted assets
|
||||||||||||||||||||||||
Company
|
97,291
|
14.11
|
58,604
|
8.50
|
N/A
|
N/A
|
||||||||||||||||||
Bank
|
98,302
|
14.28
|
58,518
|
8.50
|
55,076
|
8.00
|
||||||||||||||||||
CET 1 capital to risk-weighted assets
|
||||||||||||||||||||||||
Company
|
97,291
|
14.11
|
48,262
|
7.00
|
N/A
|
N/A
|
||||||||||||||||||
Bank
|
98,302
|
14.28
|
48,192
|
7.00
|
44,749
|
6.50
|
||||||||||||||||||
Tier 1 leverage ratio
|
||||||||||||||||||||||||
Company
|
97,291
|
11.53
|
N/A
|
N/A
|
N/A
|
N/A
|
||||||||||||||||||
Bank
|
98,302
|
11.65
|
N/A
|
N/A
|
42,241
|
5.00
|
Payments Due as of September 30, 2020
|
||||||||||||||||||||
Within
One Year
|
One to
Three Years
|
Three to
Five Years
|
After
Five Years
|
Total
|
||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||
Deposits without a stated maturity
|
$
|
680,154
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
680,154
|
||||||||||
Time deposits
|
138,917
|
43,633
|
965
|
—
|
183,515
|
|||||||||||||||
Borrowings
|
—
|
—
|
—
|
—
|
—
|
|||||||||||||||
Operating lease commitments
|
536
|
451
|
83
|
—
|
1,070
|
|||||||||||||||
Total contractual obligations
|
$
|
819,607
|
$
|
44,084
|
$
|
1,048
|
$
|
—
|
$
|
864,739
|
Payments Due as of December 31, 2019
|
||||||||||||||||||||
Within
One Year
|
One to
Three Years
|
Three to
Five Years
|
After
Five Years
|
Total
|
||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||
Deposits without a stated maturity
|
$
|
554,945
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
554,945
|
||||||||||
Time deposits
|
156,283
|
44,310
|
1,945
|
—
|
202,538
|
|||||||||||||||
Borrowings
|
—
|
—
|
—
|
—
|
—
|
|||||||||||||||
Operating lease commitments
|
623
|
845
|
49
|
—
|
1,517
|
|||||||||||||||
Total contractual obligations
|
$
|
711,851
|
$
|
45,155
|
$
|
1,994
|
$
|
—
|
$
|
759,000
|
As of
September 30,
2020
|
As of
December 31,
2019
|
|||||||
(Dollars in thousands)
|
||||||||
Commitments to extend credit
|
$
|
191,479
|
$
|
191,459
|
||||
Standby letters of credit
|
860
|
3,338
|
||||||
Total
|
$
|
192,339
|
$
|
194,797
|
|
Number of Shares
Purchased
|
Average Price Paid Per Share
|
Number of Shares That May
Yet be Purchased Under the
Program
|
|||||||||
|
(Dollars in thousands, except per share data)
|
|||||||||||
January 1, 2020 to January 31, 2020
|
—
|
—
|
—
|
|||||||||
February 1, 2020 to February 29, 2020
|
—
|
—
|
—
|
|||||||||
March 1, 2020 to March 31, 2020
|
793,094
|
$
|
8.59
|
206,906
|
||||||||
April 1, 2020 to April 30, 2020
|
28,395
|
$
|
7.28
|
178,511
|
||||||||
May 1, 2020 to May 31, 2020
|
9,765
|
$
|
9.69
|
168,746
|
||||||||
June 1, 2020 to June 30, 2020
|
—
|
—
|
168,746
|
|||||||||
July 1, 2020 to July 31, 2020
|
—
|
—
|
168,746
|
|||||||||
August 1, 2020 to August 31, 2020
|
—
|
—
|
168,746
|
|||||||||
September 1, 2020 to September 30, 2020
|
4,000
|
$
|
8.96
|
164,746
|
||||||||
For the Nine Months Ended September 30, 2020
|
835,254
|
$
|
8.56
|
164,746
|
Certification of Principal Executive Officer pursuant to Rule 13a-14(a) of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
Certification of Principal Financial Officer pursuant to Rule 13a-14(a) of the Exchange Act as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
101.INS
|
XBRL Instance Document.
|
101.SCH
|
XBRL Taxonomy Extension Schema Document.
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase Document.
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
BANK7 CORP.
|
|||
DATED:
|
November 16, 2020
|
By: /s/ Thomas L. Travis
|
|
Thomas L. Travis
|
|||
President and Chief Executive Officer
|
|||
DATED:
|
November 16, 2020
|
By: /s/ Kelly J. Harris
|
|
Kelly J. Harris
|
|||
Senior Vice President and Chief Financial Officer
|
1. |
I have reviewed this quarterly report on Form 10-Q of Bank7 Corp.;
|
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this report;
|
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of
the registrant as of, and for, the periods presented in this report;
|
4. |
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:
|
a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b) |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c) |
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end
of the period covered by this report based on such evaluation; and
|
d) |
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the
case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5. |
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the
registrant’s board of directors (or persons performing the equivalent functions):
|
a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record,
process, summarize and report financial information; and
|
b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Thomas L. Travis
|
|
Date: November 16, 2020
|
Thomas L. Travis
|
President and Chief Executive Officer (Principal Executive Officer)
|
1. |
I have reviewed this quarterly report on Form 10-Q of Bank7 Corp.;
|
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this report;
|
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of
the registrant as of, and for, the periods presented in this report;
|
4. |
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:
|
a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b) |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c) |
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end
of the period covered by this report based on such evaluation; and
|
d) |
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the
case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5. |
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the
registrant’s board of directors (or persons performing the equivalent functions):
|
a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record,
process, summarize and report financial information; and
|
b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Kelly J. Harris
|
|
Date: November 16, 2020
|
Kelly J. Harris
|
Senior Vice President and Chief Financial Officer (Principal Financial Officer)
|
/s/ Thomas L. Travis
|
|
Date: November 16, 2020
|
Thomas L. Travis
|
President and Chief Executive Officer (Principal Executive Officer)
|
/s/ Kelly J. Harris
|
|
Kelly J. Harris
|
|
Senior Vice President and Chief Financial Officer (Principal Financial Officer)
|
Document and Entity Information - shares |
9 Months Ended | |
---|---|---|
Sep. 30, 2020 |
Nov. 16, 2020 |
|
Cover [Abstract] | ||
Entity Registrant Name | Bank7 Corp. | |
Entity Central Index Key | 0001746129 | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Shell Company | false | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Common Stock, Shares Outstanding | 9,044,765 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Entity Address, State or Province | OK |
Unaudited Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands |
Sep. 30, 2020 |
Dec. 31, 2019 |
---|---|---|
Assets | ||
Allowance for loan losses | $ 11,131 | $ 7,846 |
Shareholders' equity | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Common stock, shares issued (in shares) | 9,241,689 | 10,057,506 |
Common stock, shares outstanding (in shares) | 9,241,689 | 10,057,506 |
Non-voting Common Stock [Member] | ||
Shareholders' equity | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 20,000,000 | 20,000,000 |
Common stock, shares issued (in shares) | 0 | 0 |
Common stock, shares outstanding (in shares) | 0 | 0 |
Unaudited Condensed Consolidated Statements of Shareholders' Equity (Parenthetical) - $ / shares |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2020 |
Sep. 30, 2019 |
Sep. 30, 2020 |
Sep. 30, 2019 |
|
Unaudited Condensed Consolidated Statements of Shareholders' Equity [Abstract] | ||||
Cash dividends declared (in dollars per share) | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 |
Nature of Operations and Summary of Significant Accounting Policies |
9 Months Ended | ||
---|---|---|---|
Sep. 30, 2020 | |||
Nature of Operations and Summary of Significant Accounting Policies [Abstract] | |||
Nature of Operations and Summary of Significant Accounting Policies |
Nature of Operations Bank7 Corp. (the “Company”), formerly known as Haines Financial Corp, is a bank holding company whose principal activity is the ownership and management of its wholly owned subsidiary, Bank7 (the “Bank”). The Bank is primarily engaged in providing a full range of banking and financial services to individual and corporate customers located in Oklahoma, Kansas, and Texas. The Bank is subject to competition from other financial institutions. The Company is subject to the regulation of certain federal agencies and undergoes periodic examinations by those regulatory authorities. Basis of Presentation The accompanying unaudited interim consolidated financial statements contained herein reflect all adjustments which are, in the opinion of management, necessary to provide a fair statement of the financial position, results of operations, and cash flows of the Company for the interim periods presented. All such adjustments are of a normal and recurring nature. There have been no significant changes in the accounting policies of the Company since December 31, 2019, the date of the most recent annual report. The condensed consolidated balance sheet of the Company as of December 31, 2019 has been derived from the audited consolidated balance sheet of the Company as of that date. Certain information and notes normally included in the Company’s annual financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. The information contained in the financial statements and footnotes included in Company’s annual report for the year ended December 31, 2019, should be referred to in connection with these unaudited interim consolidated financial statements. Operating results for the interim periods disclosed herein are not necessarily indicative of the results that may be expected for a full year or any future period. Share Repurchase Program During the nine months ended September 30, 2020, 835,254 shares were repurchased under the Company’s share repurchase program at an average price of $8.70 per share and retired and returned to the status of authorized but unissued shares. There were no shares repurchased during the nine months ended September 30, 2019. Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company, the Bank and its subsidiary, 1039 NW 63rd, LLC, which holds real estate utilized by the Bank. All significant intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan losses, valuation of other real estate owned, other-than-temporary impairments, income taxes, goodwill and intangibles and fair values of financial instruments. Loans Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoffs are reported at their outstanding principal balances adjusted for unearned income, charge-offs, the allowance for loan losses, any unamortized deferred fees or costs on originated loans and unamortized premiums or discounts on purchased loans. For loans amortized at cost, interest income is accrued based on the unpaid principal balance. Loan origination fees, net of certain direct origination costs, as well as premiums and discounts, are deferred and amortized over the respective term of the loan. The accrual of interest on loans is discontinued at the time the loan is 90 days past due unless the credit is well-secured and in process of collection. Past-due status is based on contractual terms of the loan. In all cases, loans are placed on nonaccrual or charged off at an earlier date if collection of principal or interest is considered doubtful. All interest accrued but not collected for loans that are placed on nonaccrual or charged off are reversed against interest income. The interest on these loans is accounted for on the cash-basis or cost-recovery method, until qualifying for return to accrual. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured. Allowance for Loan Losses The allowance for loan losses is established as losses are estimated to have occurred through a provision for loan losses charged to income. Loan losses are charged against the allowance when management believes the uncollectability of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance. The allowance for loan losses is evaluated on a regular basis by management and is based upon management’s periodic review of the collectability of the loans in light of historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay and estimated value of any underlying collateral and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. The allowance consists of allocated and general components. The allocated component relates to loans that are classified as impaired. For those loans that are classified as impaired, an allowance is established when the discounted cash flows or collateral value or observable market price of the impaired loan is lower than the carrying value of that loan. The general component covers nonimpaired loans and is based on historical charge-off experience and expected loss given default derived from the Company’s internal risk rating process. Other adjustments may be made to the allowance for pools of loans after an assessment of internal or external influences on credit quality that are not fully reflected in the historical loss or risk rating data. A loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record and the amount of the shortfall in relation to the principal and interest owed. Impairment is measured on a loan-by-loan basis for commercial and construction loans by either the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s obtainable market price or the fair value of the collateral if the loan is collateral-dependent. Groups of loans with similar risk characteristics are collectively evaluated for impairment based on the group’s historical loss experience adjusted for changes in trends, conditions and other relevant factors that affect repayment of the loans. Accordingly, the Company does not separately identify individual consumer loans for impairment measurements, unless such loans are the subject of a restructuring agreement due to financial difficulties of the borrower. Recent Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). The ASU requires lessees to recognize a lease liability and a right-of-use asset for all leases, excluding short-term leases, at the commencement date. The guidance in the ASU is effective for reporting periods beginning after December 15, 2021. Additionally, a modified retrospective transition approach is required for a leases existing at the earliest comparative period presented. Management is assessing the impact of this ASU; however, it is not expected to have a material impact on the Company’s financial condition, results of operation, or capital position, but will impact the presentation on the balance sheet of the Company’s current operating leases. The Company will adopt this ASU in the first quarter of 2021. In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326). The ASU requires the replacement of the current incurred loss model with an expected loss model, referred to as the current expected credit loss (CECL) model. The guidance in the ASU is effective for reporting periods beginning after December 15, 2022 with a cumulative-effect adjustment to retained earnings required for the first reporting period. Management is still assessing the impact of this ASU. The Company will adopt this ASU in the first quarter of 2023. In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. The ASU amends existing guidance to simplify the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. Under the new guidance, if a reporting unit’s carrying amount exceeds its fair value an entity will record an impairment charge based on that difference. The standard eliminates today’s requirement to calculate a goodwill impairment charge using Step 2, which requires an entity to calculate any impairment charge by comparing the implied fair value of goodwill with its carrying amount. Early adoption is permitted. ASU 2017-04 was adopted as of January 1, 2020, with no significant impacts on the Company’s financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820). ASU 2018-13 removes, modifies and adds disclosure requirements on fair value measurements. ASU 2018-13 was adopted on January 1, 2020, and did not have a significant impact on the Company’s financial statements. Legislative and Regulatory Developments On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was signed into law. It contains substantial tax and spending provisions intended to address the impact of the COVID-19 pandemic. The goal of the CARES Act is to prevent a severe economic downturn through various measures, including direct financial aid to American families and economic stimulus to significantly impacted industry sectors. The CARES Act also includes a range of other provisions designed to support the U.S. economy and mitigate the impact of COVID-19 on financial institutions and their customers, including through the authorization of various programs and measures that the U.S. Department of the Treasury, the Small Business Administration, the Federal Reserve Board, and other federal banking agencies may or are required to implement. Further, in response to the COVID-19 outbreak, the Federal Reserve Board has implemented or announced a number of facilities to provide emergency liquidity to various segments of the U.S. economy and financial market. The CARES Act created a $349 billion loan program called the Paycheck Protection Program (the “PPP”) for loans to small businesses for, among other things, payroll, group health care benefit costs and qualifying mortgage, rent and utility payments. PPP loans are fully guaranteed by the Small Business Administration (SBA). As of September 30, 2020, the Company had originated 333 PPP loans with balances totaling $64.3 million. The extent to which the COVID-19 pandemic impacts the Company’s business, liquidity, asset valuations, results of operations, and financial condition, as well as its regulatory capital and liquidity ratios, will depend on future developments, which are highly uncertain, including the scope and duration of the pandemic and actions taken by governmental authorities and other third parties in response to the pandemic. Moreover, the effects of the COVID-19 pandemic may have a material adverse effect on all or a combination of valuation impairments on the Company’s intangible assets, loans, or deferred tax assets. |
Restriction on Cash and Due from Banks |
9 Months Ended | ||
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Sep. 30, 2020 | |||
Restriction on Cash and Due from Banks [Abstract] | |||
Restriction on Cash and Due from Banks |
The Company is required to maintain reserve funds in cash and/or on deposit with the Federal Reserve Bank. The reserve required at September 30, 2020 was $0. |
Earnings Per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share |
Basic earnings per common share represents the amount of earnings for the period available to each share of common stock outstanding during the reporting period. Basic EPS is computed based upon net income divided by the weighted average number of common shares outstanding during the year. Diluted EPS represents the amount of earnings for the period available to each share of common stock outstanding including common stock that would have been outstanding assuming the issuance of common shares for all dilutive potential common shares outstanding during each reporting period. Diluted EPS is computed based upon net income dividend by the weighted average number of commons shares outstanding during each period, adjusted for the effect of dilutive potential common shares, such as restricted stock awards and nonqualified stock options, calculated using the treasury stock method. The following table shows the computation of basic and diluted earnings per share:
(1) The following have not been included in diluted earnings per share becuase to do so would have been antidilutive for the periods presented: Nonqualified stock options outstanding of 185,250 and 163,000 for the three month periods ended September 30, 2020 and 2019, respectively; nonqualified stock options outstanding of 185,250 and 130,000 for the nine month periods ended September 30, 2020 and 2019, respectively; restricted stock units of 108,000 for the three and nine month periods ended September 30, 2020. |
Loans and Allowance for Loan Losses |
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Loans and Allowance for Loan Losses [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loans and Allowance for Loan Losses |
A summary of loans at September 30, 2020 and December 31, 2019, are as follows (dollars in thousands):
Included in the commercial & industrial loan balance at September 30, 2020, are $64.3 million of loans that were originated under the SBA PPP program. The following table presents, by portfolio segment, the activity in the allowance for loan losses for the three months ended September 30, 2020 and 2019 (dollars in thousands):
The following table presents, by portfolio segment, the activity in the allowance for loan losses for the nine months ended September 30, 2020 and 2019 (dollars in thousands):
The following table presents, by portfolio segment, the balance in allowance for loan losses and the gross loans based upon portfolio segment and impairment method as of September 30, 2020 and December 31, 2019 (dollars in thousands):
Internal Risk Categories Each loan segment is made up of loan categories possessing similar risk characteristics. Risk characteristics applicable to each segment of the loan portfolio are described as follows: Real Estate – The real estate portfolio consists of residential and commercial properties. Residential loans are generally secured by owner occupied 1–4 family residences. Repayment of these loans is primarily dependent on the personal income and credit rating of the borrowers. Credit risk in these loans can be impacted by economic conditions within the Company’s market areas that might impact either property values or a borrower’s personal income. Risk is mitigated by the fact that the loans are of smaller individual amounts and spread over a large number of borrowers. Commercial real estate loans in this category typically involve larger principal amounts and are repaid primarily from the cash flow of a borrower’s principal business operation, the sale of the real estate or income independent of the loan purpose. Credit risk in these loans is driven by the creditworthiness of a borrower, property values, the local economy and other economic conditions impacting a borrower’s business or personal income. Commercial & Industrial – The commercial portfolio includes loans to commercial customers for use in financing working capital needs, equipment purchases and expansions. The loans in this category are repaid primarily from the cash flow of a borrower’s principal business operation. Credit risk in these loans is driven by creditworthiness of a borrower and the economic conditions that impact the cash flow stability from business operations. Agricultural – Loans secured by agricultural assets are generally made for the purpose of acquiring land devoted to crop production, cattle or poultry or the operation of a similar type of business on the secured property. Sources of repayment for these loans generally include income generated from operations of a business on the property, rental income or sales of the property. Credit risk in these loans may be impacted by crop and commodity prices, the creditworthiness of a borrower, and changes in economic conditions which might affect underlying property values and the local economies in the Company’s market areas. Consumer – The consumer loan portfolio consists of various term and line of credit loans such as automobile loans and loans for other personal purposes. Repayment for these types of loans will come from a borrower’s income sources that are typically independent of the loan purpose. Credit risk is driven by consumer economic factors, such as unemployment and general economic conditions in the Company’s market area and the creditworthiness of a borrower. Loan grades are numbered 1 through 4. Grade 1 is considered satisfactory. The grades of 2 and 3, or Watch and Special Mention, respectively, represent loans of lower quality and are considered criticized. Grade of 4, or Substandard, refers to loans that are classified.
The Company evaluates the definitions of loan grades and the allowance for loan losses methodology on an ongoing basis. No changes were made to either during the period ended September 30, 2020. The following table presents the credit risk profile of the Company’s loan portfolio based on internal rating category as of September 30, 2020 and December 31, 2019 (dollars in thousands):
The following table presents the Company’s loan portfolio aging analysis of the recorded investment in loans as of September 30, 2020 and December 31, 2019 (dollars in thousands):
The following table presents impaired loans as of September 30, 2020 and December 31, 2019 (dollars in thousands):
Impaired loans include nonperforming loans and also include loans modified in troubled-debt restructurings where concessions have been granted to borrowers experiencing financial difficulties. These concessions could include a reduction in interest rate on the loan, payment extensions, forgiveness of principal, forbearance or other actions intended to maximize collection. Included in certain loan categories in the impaired loans are troubled debt restructurings that were classified as impaired. At September 30, 2020, the Company had $1,656,000 of commercial real estate loans that were modified in troubled-debt restructurings and impaired and $1,809,000 of commercial real estate and $912,000 of agricultural loan modifications as of December 31, 2019. There were no newly modified troubled-debt restructurings during the nine months ended September 30, 2020. There were no troubled-debt restructurings modified in the past nine months that subsequently defaulted for the period ended September 30, 2020. The following table represents information regarding nonperforming assets at September 30, 2020 and December 31, 2019 (dollars in thousands):
The CARES Act includes a provision that permits a financial institution to elect to suspend temporarily troubled debt restructuring accounting under ASC Subtopic 310-40 in certain circumstances (“section 4013”). To be eligible under section 4013, a loan modification must be (1) related to COVID-19; (2) executed on a loan that was not more than 30 days past due as of December 31, 2019; and (3) executed between March 1, 2020, and the earlier of (A) 60 days after the date of termination of the National Emergency or (B) December 31, 2020. In response to this section of the CARES Act, the federal banking agencies issued a revised interagency statement on April 7, 2020 that, in consultation with the Financial Accounting Standards Board, confirmed that for loans not subject to section 4013, short-term modifications made on a good faith basis in response to COVID-19 to borrowers who were current prior to any relief are not troubled debt restructurings under ASC Subtopic 310-40. This includes short-term (e.g., up to six months) modifications such as payment deferrals, fee waivers, extensions of repayment terms, or delays in payment that are insignificant. Borrowers considered current are those that are less than 30 days past due on their contractual payments at the time a modification program is implemented. As of September 30, 2020, 23 loans totaling $121.0 million were modified, related to COVID-19, which were not considered troubled debt restructurings. |
Shareholders' Equity |
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Shareholders' Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shareholders' Equity |
On September 5, 2019, the Company adopted a Repurchase Plan (the “RP”). The RP initially authorized the repurchase of up to 500,000 shares of the Company’s common stock. On March 13, 2020, the Company’s Board of Directors approved a 500,000 share expansion, and on November 2, 2020, approved a 750,000 share expansion to the existing stock repurchase program, for a total of 1,750,000 shares authorized under the program. All shares repurchased under the RP have been retired and not held as treasury stock. The timing, price and amount of stock repurchases under the RP may be determined by management. At September 30, 2020, there were 164,746 shares remaining that could be repurchased under the Company’s Repurchase Program. Stock repurchases under the RP will take place pursuant to a Rule 10b5-1 Plan with pricing and purchasing parameters established by management. A summary of the activity under the RP is as follows:
The Company and Bank are subject to risk-based capital guidelines issued by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s consolidated financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and Bank must meet specific capital guidelines that involve quantitative measures of assets, liabilities and certain off-balance-sheet items as calculated under GAAP, regulatory reporting requirements and regulatory capital standards. The Company’s and Bank’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors. Furthermore, the Company’s and the Bank’s regulators could require adjustments to regulatory capital not reflected in these financial statements. Quantitative measures established by regulation to ensure capital adequacy require the Company and Bank to maintain minimum amounts and ratios (set forth in the following table) of total, Tier I, and Common Equity capital (as defined in the regulations) to risk-weighted assets (as defined) and of Tier I capital (as defined) to average assets (as defined). Management believes, as of September 30, 2020, that the Company and Bank meet all capital adequacy requirements to which it is subject and maintains capital conservation buffers that allow the Company and Bank to avoid limitations on capital distributions, including dividend payments and certain discretionary bonus payments to certain executive officers. As of September 30, 2020, the most recent notification from the Federal Deposit Insurance Corporation (FDIC) categorized the Bank as well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized, the Bank must maintain capital ratios as set forth in the table. There are no conditions or events since that notification that management believes have changed the Bank’s category. In April 2020, we began originating loans to qualified small businesses under the PPP administered by the SBA. Federal bank regulatory agencies have issued an interim final rule that permits banks to neutralize the regulatory capital effects of participating in the Paycheck Protection Program Lending Facility (the “PPP Facility”) and clarify that PPP loans have a zero percent risk weight under applicable risk-based capital rules. Specifically, a bank may exclude all PPP loans pledged as collateral to the PPP Facility from its average total consolidated assets for the purposes of calculating its leverage ratio, while PPP loans that are not pledged as collateral to the PPP Facility will be included. The PPP loans of $64.3 million we originated are included in the calculation of our leverage ratio as of September 30, 2020 as we did not utilize the PPP Facility for funding purposes. The Company’s and Bank’s actual capital amounts and ratios are presented in the following table (dollars in thousands):
In July 2013, the federal regulatory authorities issued a new capital rule based, in part, on revisions developed by the Basel Committee on Banking Supervision to the Basel capital framework (Basel III). The Bank became subject to the new rule effective January 1, 2015. Generally, the new rule implements higher minimum capital requirements, revises the definition of regulatory capital components and related calculations, adds a new common equity tier 1 capital ratio, implements a new capital conservation buffer, increases the risk weighting for past due loans and provides a transition period for several aspects of the new rule. In addition, banks with less than $250 billion in assets were given a one-time opt-out election under Basel III Capital Rules to filter from regulatory capital certain accumulated other comprehensive income (AOCI) components. The Bank made the opt-out election and excludes the AOCI components from the capital ratio computations. The current (new) capital rule provides that, in order to avoid limitations on capital distributions, including dividend payments and certain discretionary bonus payments to executive officers, a banking organization must hold a capital conservation buffer composed of common equity tier 1 capital above its minimum risk-based capital requirements. The buffer is measured relative to risk-weighted assets. As fully phased in, a banking organization with a buffer greater than 2.5% would not be subject to additional limits on dividend payments or discretionary bonus payments; however, a banking organization with a buffer less than 2.5% would be subject to increasingly stringent limitations as the buffer approaches zero. The new rule also prohibits a banking organization from making dividend payments or discretionary bonus payments if its eligible retained income is negative in that quarter and its capital conservation buffer ratio was less than 2.5% as of the beginning of that quarter. Eligible net income is defined as net income for the four calendar quarters preceding the current calendar quarter, net of any distributions and associated tax effects not already reflected in net income. A summary of payout restrictions based on the capital conservation buffer is as follows:
The Bank is subject to certain restrictions on the amount of dividends that it may declare without prior regulatory approval. At September 30, 2020, approximately $33.1 million of retained earnings was available for dividend declaration from the Bank without prior regulatory approval. |
Related-Party Transactions |
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Related-Party Transactions |
At September 30, 2020 and December 31, 2019, the Company had loans outstanding to executive officers, directors, significant shareholders and their affiliates (related parties) approximating $0 and $1.1 million, respectively. A summary of these loans is as follows (dollars in thousands):
In management’s opinion, such loans and other extensions of credit and deposits were made in the ordinary course of business and were made on substantially the same terms (including interest rates and collateral) as those prevailing at the time for comparable transactions with other persons. Further, in management’s opinion, these loans did not involve more than normal risk of collectability or present other unfavorable features. The Bank leases office and retail banking space in Woodward, Oklahoma from Haines Realty Investments Company, LLC, a related party of the Company. Lease expense totaled $46,000 for the three months ended September 30, 2020 and 2019, and $138,000 for the nine months ended September 30, 2020 and 2019. In addition, payroll and office sharing arrangements were in place between the Company and certain of its affiliates. |
Employee Benefits |
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Employee Benefits |
401(k) Savings Plan The Company has a retirement savings 401(k) plan covering substantially all employees. Employees may contribute up to the maximum legal limit with the Bank matching up to 5% of the employee’s salary. Employer contributions charged to expense for the three months ended September 30, 2020 and 2019 totaled $58,000. Employer contributions charged to expense for the nine months ended September 30, 2020 and 2019 totaled $173,000 and $178,000, respectively. Stock-Based Compensation The Company adopted a nonqualified incentive stock option plan (the “Bank7 Corp. 2018 Equity Incentive Plan”) in September 2018. The Bank7 Corp. 2018 Equity Incentive Plan will terminate in September 2028, if not extended. Compensation expense related to the Plan for the three months ended September 30, 2020 and 2019 totaled $198,000 and $121,000, respectively. Employer contributions charged to expense for the nine months ended September 30, 2020 and 2019 totaled $569,000 and $450,000, respectively. There were 704,750 shares available for future grants as of September 30, 2020. On September 5, 2019, our largest shareholders, the Haines Family Trusts, contributed approximately 6.5% of their shares (656,925 shares) to the Company. Subsequently, the Company immediately issued those shares to certain executive officers, which was charged as compensation expense of $11.8 million, including payroll taxes, through the income statement of the Company. Additionally, at the discretion of the employees receiving shares to assist in paying tax withholdings, 149,425 shares were withheld and subsequently canceled, resulting in a charge to retained earnings of $2.6 million. The Company grants to employees and directors restricted stock units (RSUs) which vest ratably over either three or five years and stock options which vest ratably over four years. All RSUs and stock options are granted at the fair value of the common stock at the time of the award. The RSUs are considered fixed awards as the number of shares and fair value are known at the date of grant and the fair value at the grant date is amortized over the vesting and/or service period. The Company uses newly issued shares for granting RSUs and stock options. The following table is a summary of the stock option activity under the Bank7 Corp. 2018 Equity Incentive Plan (dollar amounts in thousands, except per share data):
The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model and is based on certain assumptions including risk-free rate of return, dividend yield, stock price volatility and the expected term. The fair value of each option is expensed over its vesting period. The following table shows the assumptions used for computing stock-based compensation expense under the fair value method on options granted during the period presented:
The following table summarizes share information about RSUs for the nine months ended September 30, 2020:
As of September 30, 2020, there was approximately $1.9 million of unrecognized compensation expense related to 108,000 unvested RSUs and $406,000 of unrecognized compensation expense related to 185,250 unvested and/or unexercised stock options. The stock option expense is expected to be recognized over a weighted average period of 2.46 years, and the RSU expense is expected to be recognized over a weighted average period of 3.24 years. |
Disclosures About Fair Value of Assets and Liabilities |
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Disclosures About Fair Value of Assets and Liabilities [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosures About Fair Value of Assets and Liabilities |
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements must maximize the use of observable inputs and minimize the use of unobservable inputs. There is a hierarchy of three levels of inputs that may be used to measure fair value:
Recurring Measurements There were no assets measured at fair value on a recurring basis as of September 30, 2020 and December 31, 2019. Nonrecurring Measurements The following table presents the fair value measurement of assets measured at fair value on a nonrecurring basis and the level within the fair value hierarchy in which the fair value measurements fall at September 30, 2020 and December 31, 2019 (dollars in thousands):
Following is a description of the valuation methodologies and inputs used for assets measured at fair value on a nonrecurring basis and recognized in the accompanying consolidated balance sheets, as well as the general classification of such assets pursuant to the valuation hierarchy. For assets classified within Level 3 of the fair value hierarchy, the process used to develop the reported fair value is described below. Collateral-Dependent Impaired Loans, Net of Allowance for Loan Losses The estimated fair value of collateral-dependent impaired loans is based on fair value, less estimated cost to sell. Collateral-dependent impaired loans are classified within Level 3 of the fair value hierarchy. The Company considers evaluation analysis as the starting point for determining fair value and then considers other factors and events in the environment that may affect the fair value. Values of the collateral underlying collateral-dependent loans are obtained when the loan is determined to be collateral-dependent and subsequently as deemed necessary by executive management and loan administration. Values are reviewed for accuracy and consistency by executive management and loan administration. The ultimate collateral values are reduced by discounts to consider lack of marketability and estimated cost to sell if repayment or satisfaction of the loan is dependent on the sale of the collateral. Unobservable (Level 3) Inputs The following table presents quantitative information about unobservable inputs used in recurring and nonrecurring Level 3 fair value measurements.
The following tables presents estimated fair values of the Company’s financial instruments not recorded at fair value at September 30, 2020 and December 31, 2019 (dollars in thousands):
The following methods were used to estimate the fair value of all other financial instruments recognized in the accompanying consolidated balance sheets at amounts other than fair value: Cash and Due from Banks, Interest-Bearing Time Deposits in Other Banks, Nonmarketable Equity Securities, Interest Receivable and Interest Payable The carrying amount approximates fair value. Loans and Mortgage Loans Held for Sale The fair value of loans is estimated by discounting the future cash flows using the market rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities. Loans with similar characteristics were aggregated for purposes of the calculations. Deposits Deposits include demand deposits, savings accounts, NOW accounts and certain money market deposits. The carrying amount approximates fair value. The fair value of fixed-maturity time deposits is estimated using a discounted cash flow calculation that applies the rates currently offered for deposits of similar remaining maturities. Commitments to Extend Credit, Lines of Credit and Standby Letters of Credit The fair values of unfunded commitments are estimated using the fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the present creditworthiness of the counterparties. The fair values of standby letters of credit and lines of credit are based on fees currently charged for similar agreements or on the estimated cost to terminate or otherwise settle the obligations with the counterparties at the reporting date. The estimated fair values of the Company’s commitments to extend credit, lines of credit and standby letters of credit were not material at September 30, 2020 or December 31, 2019. |
Financial Instruments with Off-Balance Sheet Risk |
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Financial Instruments with Off-Balance Sheet Risk [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Instruments with Off-Balance Sheet Risk |
The Company is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and standby letters of credit. Those instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the accompanying consolidated balance sheets. The following summarizes those financial instruments with contract amounts representing credit risk as of September 30, 2020 and December 31, 2019 (dollars in thousands):
Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Each instrument generally has fixed expiration dates or other termination clauses. Since many of the instruments are expected to expire without being drawn upon, total commitments to extend credit amounts do not necessarily represent future cash requirements. The Company evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary, by the Company upon extension of credit is based on management’s credit evaluation of the customer. Standby letters of credit are irrevocable conditional commitments issued by the Company to guarantee the performance of a customer to a third party. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. |
Significant Estimates and Concentrations |
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Significant Estimates and Concentrations [Abstract] | |||
Significant Estimates and Concentrations |
GAAP requires disclosure of certain significant estimates and current vulnerabilities due to certain concentrations. Estimates related to the allowance for loan losses are reflected in Note 4 regarding loans. Current vulnerabilities due to off-balance sheet credit risk are discussed in Note 9. As of September 30, 2020, hospitality loans were 21% of gross total loans with outstanding balances of $188.7 million and unfunded commitments of $47.1 million; energy loans were 14% of gross total loans with outstanding balances of $126.0 million and unfunded commitments of $16.6 million. The Company evaluates goodwill for potential goodwill impairment on an annual basis or more often based on consideration if any impairment indicators have occurred. A prolonged strain on the U.S. economy impacting the Company could result in goodwill being partially or fully impaired. At September 30, 2020, goodwill of $1.0 million was recorded on the consolidated balance sheet. |
Nature of Operations and Summary of Significant Accounting Policies (Policies) |
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Nature of Operations and Summary of Significant Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited interim consolidated financial statements contained herein reflect all adjustments which are, in the opinion of management, necessary to provide a fair statement of the financial position, results of operations, and cash flows of the Company for the interim periods presented. All such adjustments are of a normal and recurring nature. There have been no significant changes in the accounting policies of the Company since December 31, 2019, the date of the most recent annual report. The condensed consolidated balance sheet of the Company as of December 31, 2019 has been derived from the audited consolidated balance sheet of the Company as of that date. Certain information and notes normally included in the Company’s annual financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. The information contained in the financial statements and footnotes included in Company’s annual report for the year ended December 31, 2019, should be referred to in connection with these unaudited interim consolidated financial statements. Operating results for the interim periods disclosed herein are not necessarily indicative of the results that may be expected for a full year or any future period. |
Share Repurchase Program | Share Repurchase Program During the nine months ended September 30, 2020, 835,254 shares were repurchased under the Company’s share repurchase program at an average price of $8.70 per share and retired and returned to the status of authorized but unissued shares. There were no shares repurchased during the nine months ended September 30, 2019. |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company, the Bank and its subsidiary, 1039 NW 63rd, LLC, which holds real estate utilized by the Bank. All significant intercompany accounts and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan losses, valuation of other real estate owned, other-than-temporary impairments, income taxes, goodwill and intangibles and fair values of financial instruments. |
Loans | Loans Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoffs are reported at their outstanding principal balances adjusted for unearned income, charge-offs, the allowance for loan losses, any unamortized deferred fees or costs on originated loans and unamortized premiums or discounts on purchased loans. For loans amortized at cost, interest income is accrued based on the unpaid principal balance. Loan origination fees, net of certain direct origination costs, as well as premiums and discounts, are deferred and amortized over the respective term of the loan. The accrual of interest on loans is discontinued at the time the loan is 90 days past due unless the credit is well-secured and in process of collection. Past-due status is based on contractual terms of the loan. In all cases, loans are placed on nonaccrual or charged off at an earlier date if collection of principal or interest is considered doubtful. All interest accrued but not collected for loans that are placed on nonaccrual or charged off are reversed against interest income. The interest on these loans is accounted for on the cash-basis or cost-recovery method, until qualifying for return to accrual. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured. |
Allowance for Loan Losses | Allowance for Loan Losses The allowance for loan losses is established as losses are estimated to have occurred through a provision for loan losses charged to income. Loan losses are charged against the allowance when management believes the uncollectability of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance. The allowance for loan losses is evaluated on a regular basis by management and is based upon management’s periodic review of the collectability of the loans in light of historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay and estimated value of any underlying collateral and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. The allowance consists of allocated and general components. The allocated component relates to loans that are classified as impaired. For those loans that are classified as impaired, an allowance is established when the discounted cash flows or collateral value or observable market price of the impaired loan is lower than the carrying value of that loan. The general component covers nonimpaired loans and is based on historical charge-off experience and expected loss given default derived from the Company’s internal risk rating process. Other adjustments may be made to the allowance for pools of loans after an assessment of internal or external influences on credit quality that are not fully reflected in the historical loss or risk rating data. A loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record and the amount of the shortfall in relation to the principal and interest owed. Impairment is measured on a loan-by-loan basis for commercial and construction loans by either the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s obtainable market price or the fair value of the collateral if the loan is collateral-dependent. Groups of loans with similar risk characteristics are collectively evaluated for impairment based on the group’s historical loss experience adjusted for changes in trends, conditions and other relevant factors that affect repayment of the loans. Accordingly, the Company does not separately identify individual consumer loans for impairment measurements, unless such loans are the subject of a restructuring agreement due to financial difficulties of the borrower. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). The ASU requires lessees to recognize a lease liability and a right-of-use asset for all leases, excluding short-term leases, at the commencement date. The guidance in the ASU is effective for reporting periods beginning after December 15, 2021. Additionally, a modified retrospective transition approach is required for a leases existing at the earliest comparative period presented. Management is assessing the impact of this ASU; however, it is not expected to have a material impact on the Company’s financial condition, results of operation, or capital position, but will impact the presentation on the balance sheet of the Company’s current operating leases. The Company will adopt this ASU in the first quarter of 2021. In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326). The ASU requires the replacement of the current incurred loss model with an expected loss model, referred to as the current expected credit loss (CECL) model. The guidance in the ASU is effective for reporting periods beginning after December 15, 2022 with a cumulative-effect adjustment to retained earnings required for the first reporting period. Management is still assessing the impact of this ASU. The Company will adopt this ASU in the first quarter of 2023. In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. The ASU amends existing guidance to simplify the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. Under the new guidance, if a reporting unit’s carrying amount exceeds its fair value an entity will record an impairment charge based on that difference. The standard eliminates today’s requirement to calculate a goodwill impairment charge using Step 2, which requires an entity to calculate any impairment charge by comparing the implied fair value of goodwill with its carrying amount. Early adoption is permitted. ASU 2017-04 was adopted as of January 1, 2020, with no significant impacts on the Company’s financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820). ASU 2018-13 removes, modifies and adds disclosure requirements on fair value measurements. ASU 2018-13 was adopted on January 1, 2020, and did not have a significant impact on the Company’s financial statements. |
Legislative and Regulatory Developments | Legislative and Regulatory Developments On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was signed into law. It contains substantial tax and spending provisions intended to address the impact of the COVID-19 pandemic. The goal of the CARES Act is to prevent a severe economic downturn through various measures, including direct financial aid to American families and economic stimulus to significantly impacted industry sectors. The CARES Act also includes a range of other provisions designed to support the U.S. economy and mitigate the impact of COVID-19 on financial institutions and their customers, including through the authorization of various programs and measures that the U.S. Department of the Treasury, the Small Business Administration, the Federal Reserve Board, and other federal banking agencies may or are required to implement. Further, in response to the COVID-19 outbreak, the Federal Reserve Board has implemented or announced a number of facilities to provide emergency liquidity to various segments of the U.S. economy and financial market. The CARES Act created a $349 billion loan program called the Paycheck Protection Program (the “PPP”) for loans to small businesses for, among other things, payroll, group health care benefit costs and qualifying mortgage, rent and utility payments. PPP loans are fully guaranteed by the Small Business Administration (SBA). As of September 30, 2020, the Company had originated 333 PPP loans with balances totaling $64.3 million. The extent to which the COVID-19 pandemic impacts the Company’s business, liquidity, asset valuations, results of operations, and financial condition, as well as its regulatory capital and liquidity ratios, will depend on future developments, which are highly uncertain, including the scope and duration of the pandemic and actions taken by governmental authorities and other third parties in response to the pandemic. Moreover, the effects of the COVID-19 pandemic may have a material adverse effect on all or a combination of valuation impairments on the Company’s intangible assets, loans, or deferred tax assets. |
Earnings Per Share (Tables) |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basic and Diluted Earnings Per Share | The following table shows the computation of basic and diluted earnings per share:
(1) The following have not been included in diluted earnings per share becuase to do so would have been antidilutive for the periods presented: Nonqualified stock options outstanding of 185,250 and 163,000 for the three month periods ended September 30, 2020 and 2019, respectively; nonqualified stock options outstanding of 185,250 and 130,000 for the nine month periods ended September 30, 2020 and 2019, respectively; restricted stock units of 108,000 for the three and nine month periods ended September 30, 2020. |
Loans and Allowance for Loan Losses (Tables) |
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Sep. 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loans and Allowance for Loan Losses [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Loans | A summary of loans at September 30, 2020 and December 31, 2019, are as follows (dollars in thousands):
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Activity in Allowance for Loan Losses by Portfolio Segment | The following table presents, by portfolio segment, the activity in the allowance for loan losses for the three months ended September 30, 2020 and 2019 (dollars in thousands):
The following table presents, by portfolio segment, the activity in the allowance for loan losses for the nine months ended September 30, 2020 and 2019 (dollars in thousands):
The following table presents, by portfolio segment, the balance in allowance for loan losses and the gross loans based upon portfolio segment and impairment method as of September 30, 2020 and December 31, 2019 (dollars in thousands):
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Loan Portfolio Based on Internal Rating Category | The following table presents the credit risk profile of the Company’s loan portfolio based on internal rating category as of September 30, 2020 and December 31, 2019 (dollars in thousands):
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Loan Portfolio Aging Analysis of Recorded Investment in Loans | The following table presents the Company’s loan portfolio aging analysis of the recorded investment in loans as of September 30, 2020 and December 31, 2019 (dollars in thousands):
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Impaired Loans | The following table presents impaired loans as of September 30, 2020 and December 31, 2019 (dollars in thousands):
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Information Regarding Nonperforming Assets | The following table represents information regarding nonperforming assets at September 30, 2020 and December 31, 2019 (dollars in thousands):
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Shareholders' Equity (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shareholders' Equity [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Repurchase | A summary of the activity under the RP is as follows:
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|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Actual Capital Amounts and Ratios | The Company’s and Bank’s actual capital amounts and ratios are presented in the following table (dollars in thousands):
|
Related-Party Transactions (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related-Party Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Loans | A summary of these loans is as follows (dollars in thousands):
|
Employee Benefits (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Options Activity | The following table is a summary of the stock option activity under the Bank7 Corp. 2018 Equity Incentive Plan (dollar amounts in thousands, except per share data):
|
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Weighted-Average Inputs and Risk-Free Rate of Return Ranges used to Calculate Grant Date Fair Value of Options | The following table shows the assumptions used for computing stock-based compensation expense under the fair value method on options granted during the period presented:
|
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Restricted Stock Units | The following table summarizes share information about RSUs for the nine months ended September 30, 2020:
|
Disclosures About Fair Value of Assets and Liabilities (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosures About Fair Value of Assets and Liabilities [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Assets Measured at Fair Value on Nonrecurring Basis | The following table presents the fair value measurement of assets measured at fair value on a nonrecurring basis and the level within the fair value hierarchy in which the fair value measurements fall at September 30, 2020 and December 31, 2019 (dollars in thousands):
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Quantitative Information About Unobservable Inputs Used in Recurring and Nonrecurring Level 3 Fair Value Measurements | The following table presents quantitative information about unobservable inputs used in recurring and nonrecurring Level 3 fair value measurements.
|
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Estimated Fair Value of Financial Instruments not Recorded at Fair Value | The following tables presents estimated fair values of the Company’s financial instruments not recorded at fair value at September 30, 2020 and December 31, 2019 (dollars in thousands):
|
Financial Instruments with Off-Balance Sheet Risk (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Instruments with Off-Balance Sheet Risk [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Instruments with Contract Amounts Representing Credit Risk | The following summarizes those financial instruments with contract amounts representing credit risk as of September 30, 2020 and December 31, 2019 (dollars in thousands):
|
Nature of Operations and Summary of Significant Accounting Policies (Details) $ / shares in Units, $ in Thousands |
9 Months Ended | ||
---|---|---|---|
Sep. 30, 2020
USD ($)
Loan
$ / shares
shares
|
Sep. 30, 2019
shares
|
Dec. 31, 2019
USD ($)
|
|
Stock Repurchase Program [Abstract] | |||
Number of shares repurchased (in shares) | shares | 835,254 | 0 | |
Average price of shares repurchased (in dollars per share) | $ / shares | $ 8.70 | ||
Legislative and Regulatory Developments [Abstract] | |||
Gross loans | $ 883,222 | $ 708,668 | |
PPP Loans [Member] | |||
Legislative and Regulatory Developments [Abstract] | |||
Number of loans originated | Loan | 333 | ||
Gross loans | $ 64,300 |
Restriction on Cash and Due from Banks (Details) $ in Millions |
Sep. 30, 2020
USD ($)
|
---|---|
Restriction on Cash and Due from Banks [Abstract] | |
Reserve funds to be maintained with Federal Reserve Bank | $ 0 |
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 9 Months Ended | ||||
---|---|---|---|---|---|---|
Sep. 30, 2020 |
Sep. 30, 2019 |
Sep. 30, 2020 |
Sep. 30, 2019 |
|||
Numerator [Abstract] | ||||||
Net income (loss) | $ 4,440 | $ (6,519) | $ 14,527 | $ 3,723 | ||
Denominator [Abstract] | ||||||
Weighted-average shares outstanding for basic earnings per share (in shares) | 9,228,128 | 10,149,007 | 9,483,540 | 10,174,528 | ||
Dilutive effect of stock compensation (in shares) | [1] | 0 | 12,771 | 0 | 1,832 | |
Denominator for diluted earnings per share (in shares) | 9,228,128 | 10,161,778 | 9,483,540 | 10,176,360 | ||
Earnings per common share [Abstract] | ||||||
Basic (in dollars per share) | $ 0.48 | $ (0.64) | $ 1.53 | $ 0.37 | ||
Diluted (in dollars per share) | $ 0.48 | $ (0.64) | $ 1.53 | $ 0.37 | ||
Nonqualified Stock Options [Member] | ||||||
Antidilutive securities [Abstract] | ||||||
Antidilutive shares excluded from the calculation of earnings per share (in shares) | 185,250 | 163,000 | 185,250 | 130,000 | ||
Restricted Stock Units [Member] | ||||||
Antidilutive securities [Abstract] | ||||||
Antidilutive shares excluded from the calculation of earnings per share (in shares) | 108,000 | 108,000 | ||||
|
Loans and Allowance for Loan Losses, Information Regarding Nonperforming Assets (Details) $ in Thousands |
9 Months Ended | |||
---|---|---|---|---|
Sep. 30, 2020
USD ($)
Loan
|
Dec. 31, 2019
USD ($)
|
|||
Loans and Allowance for Loan Losses [Abstract] | ||||
Nonaccrual loans | $ 20,515 | $ 1,809 | ||
Troubled-debt restructurings | [1] | 0 | 912 | |
Accruing loans 90 or more days past due | 0 | 612 | ||
Total nonperforming loans | 20,515 | 3,333 | ||
Troubled Debt Restructurings [Abstract] | ||||
TDR loans impaired | 1,656 | 1,810 | ||
Commercial & Industrial [Member] | ||||
Loans and Allowance for Loan Losses [Abstract] | ||||
Accruing loans 90 or more days past due | $ 0 | $ 14 | ||
COVID-19 [Member] | ||||
Troubled Debt Restructurings [Abstract] | ||||
Number of loans modified that were not considered troubled debt restructurings | Loan | 23 | |||
Amount of loans modified that were not considered troubled debt restructurings | $ 121,000 | |||
|
Related-Party Transactions (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | 12 Months Ended | ||
---|---|---|---|---|---|
Sep. 30, 2020 |
Sep. 30, 2019 |
Sep. 30, 2020 |
Sep. 30, 2019 |
Dec. 31, 2019 |
|
Summary of Loans [Roll Forward] | |||||
Balance Beginning of the Period | $ 1,055 | $ 6,897 | $ 6,897 | ||
Additions | 0 | 2,613 | |||
Collections/ Terminations | (1,055) | (8,455) | |||
Balance End of the Period | $ 0 | 0 | $ 1,055 | ||
Haines Realty Investments Company, LLC [Member] | |||||
Sale of subsidiary [Abstract] | |||||
Lease expense | $ 46 | $ 46 | $ 138 | $ 138 |
Employee Benefits (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2020 |
Sep. 30, 2019 |
Sep. 30, 2020 |
Sep. 30, 2019 |
|
Common Stock [Member] | ||||
Share-based Compensation [Abstract] | ||||
Shares acquired and canceled (in shares) | (4,000) | (149,425) | (835,254) | (149,425) |
Shares acquired and canceled | $ 0 | $ (1) | $ (9) | $ (1) |
Common Stock [Member] | Employees [Member] | ||||
Share-based Compensation [Abstract] | ||||
Shares acquired and canceled (in shares) | (149,425) | |||
Retained Earnings [Member] | ||||
Share-based Compensation [Abstract] | ||||
Shares acquired and canceled | (103) | (2,645) | $ (7,210) | (2,645) |
Retained Earnings [Member] | Employees [Member] | ||||
Share-based Compensation [Abstract] | ||||
Shares acquired and canceled | $ (2,600) | |||
Percentage of employee's compensation matched by company | 5.00% | |||
Defined benefit plan, employer contribution | 58 | 58 | $ 173 | 178 |
Percentage of contribution in shares by largest shareholder | 6.50% | |||
Number of shares contributed by the largest shareholder (in shares) | 656,925 | |||
Stock-based compensation expense | $ 569 | $ 12,078 | ||
Shares acquired and canceled (in shares) | (835,254) | 0 | ||
Executive Officers [Member] | ||||
Share-based Compensation [Abstract] | ||||
Stock-based compensation expense | $ 11,800 | |||
2018 Equity Incentive Plan [Member] | ||||
Share-based Compensation [Abstract] | ||||
Stock-based compensation expense | $ 198 | $ 121 | $ 569 | $ 450 |
Shares available for future grants (in shares) | 704,750 | 704,750 | ||
Unearned stock-based compensation expense [Abstract] | ||||
Risk-free interest rate | 1.71% | 2.48% | ||
Dividend yield | 2.20% | 2.20% | ||
Stock price volatility | 41.27% | 31.14% | ||
Expected term | 7 years 6 months 4 days | 7 years 4 days | ||
2018 Equity Incentive Plan [Member] | RSUs [Member] | ||||
Share-based Compensation [Abstract] | ||||
Unrecognized compensation expense | $ 1,900 | $ 1,900 | ||
Period for recognition of compensation cost not yet recognized | 3 years 2 months 26 days | |||
Restricted Stock Units [Roll Forward] | ||||
Outstanding, beginning of the period (in shares) | 104,000 | |||
Shares granted (in shares) | 31,000 | |||
Shares settled (in shares) | 26,000 | |||
Shares forfeited (in shares) | (1,000) | |||
Outstanding, end of the period (in shares) | 108,000 | 108,000 | ||
Weighted Average Grant Date Fair Value [Abstract] | ||||
Outstanding, beginning of period (in dollars per share) | $ 19.09 | |||
Shares granted (in dollars per share) | 18.49 | |||
Shares settled (in dollars per share) | 19.09 | |||
Shares forfeited (in dollars per share) | 18.49 | |||
Outstanding, end of period (in dollars per share) | $ 18.92 | $ 18.92 | ||
2018 Equity Incentive Plan [Member] | Stock Option [Member] | ||||
Share-based Compensation [Abstract] | ||||
Vesting period | 4 years | |||
Unrecognized compensation expense | $ 406 | $ 406 | ||
Unvested and unexercised stock options (in shares) | 185,250 | 185,250 | ||
Period for recognition of compensation cost not yet recognized | 2 years 5 months 16 days | |||
Stock Option Activity [Roll Forward] | ||||
Outstanding at beginning of period (in shares) | 163,000 | |||
Options granted (in shares) | 26,500 | |||
Options exercised (in shares) | 0 | |||
Options forfeited (in shares) | (4,250) | |||
Outstanding at end of period (in shares) | 185,250 | 185,250 | ||
Exercisable at end of period (in shares) | 75,625 | 75,625 | ||
Weighted Average Exercise Price [Roll Forward] | ||||
Outstanding at beginning of period (in dollars per share) | $ 18.75 | |||
Options granted (in dollars per share) | 18.49 | |||
Options exercised (in dollars per share) | 0 | |||
Options forfeited (in dollars per share) | 17.73 | |||
Outstanding at end of period (in dollars per share) | $ 18.73 | 18.73 | ||
Exercisable at end of period (in dollars per share) | $ 18.88 | $ 18.88 | ||
Options, Additional Disclosures [Abstract] | ||||
Weighted average remaining contractual term, Outstanding | 8 years 2 months 8 days | |||
Weighted average remaining contractual term, Exercisable | 8 years | |||
Aggregate intrinsic value, Outstanding | $ 0 | $ 0 | ||
Aggregate intrinsic value, Exercisable | $ 0 | $ 0 | ||
2018 Equity Incentive Plan [Member] | Minimum [Member] | RSUs [Member] | ||||
Share-based Compensation [Abstract] | ||||
Vesting period | 3 years | |||
2018 Equity Incentive Plan [Member] | Maximum [Member] | RSUs [Member] | ||||
Share-based Compensation [Abstract] | ||||
Vesting period | 5 years |
Disclosures About Fair Value of Assets and Liabilities, Recurring and Nonrecurring Basis (Details) - USD ($) $ in Thousands |
Sep. 30, 2020 |
Dec. 31, 2019 |
---|---|---|
Recurring Basis [Member] | ||
Asset measured at fair value on recurring basis [Abstract] | ||
Assets measured at fair value | $ 0 | $ 0 |
Nonrecurring Basis [Member] | ||
Asset measured at fair value on nonrecurring basis [Abstract] | ||
Impaired loans (collateral-dependent) | 4,376 | 1,783 |
Level 1 [Member] | Nonrecurring Basis [Member] | ||
Asset measured at fair value on nonrecurring basis [Abstract] | ||
Impaired loans (collateral-dependent) | 0 | 0 |
Level 2 [Member] | Nonrecurring Basis [Member] | ||
Asset measured at fair value on nonrecurring basis [Abstract] | ||
Impaired loans (collateral-dependent) | 0 | 0 |
Level 3 [Member] | Nonrecurring Basis [Member] | ||
Asset measured at fair value on nonrecurring basis [Abstract] | ||
Impaired loans (collateral-dependent) | $ 4,376 | $ 1,783 |
Disclosures About Fair Value of Assets and Liabilities, Quantitative Information (Details) - Nonrecurring Basis [Member] $ in Thousands |
Sep. 30, 2020
USD ($)
|
Dec. 31, 2019
USD ($)
|
---|---|---|
Quantitative information about unobservable inputs used in recurring and nonrecurring Level 3 fair value measurements [Abstract] | ||
Collateral-dependent impaired loans | $ 4,376 | $ 1,783 |
Level 3 [Member] | ||
Quantitative information about unobservable inputs used in recurring and nonrecurring Level 3 fair value measurements [Abstract] | ||
Collateral-dependent impaired loans | $ 4,376 | $ 1,783 |
Level 3 [Member] | Appraisals from Comparable Properties [Member] | Estimated Cost to Sell [Member] | Minimum [Member] | ||
Quantitative information about unobservable inputs used in recurring and nonrecurring Level 3 fair value measurements [Abstract] | ||
Collateral-dependent impaired loans, measurement input | 0.03 | 0.03 |
Level 3 [Member] | Appraisals from Comparable Properties [Member] | Estimated Cost to Sell [Member] | Maximum [Member] | ||
Quantitative information about unobservable inputs used in recurring and nonrecurring Level 3 fair value measurements [Abstract] | ||
Collateral-dependent impaired loans, measurement input | 0.05 | 0.05 |
Disclosures About Fair Value of Assets and Liabilities, Financial Instruments not Recorded at Fair Value (Details) - USD ($) $ in Thousands |
Sep. 30, 2020 |
Dec. 31, 2019 |
---|---|---|
Carrying Amount [Member] | ||
Financial Assets [Abstract] | ||
Cash and due from banks | $ 60,718 | $ 117,128 |
Interest-bearing time deposits in other banks | 23,384 | 30,147 |
Loans, net of allowance | 869,448 | 699,458 |
Mortgage loans held for sale | 315 | 1,031 |
Nonmarketable equity securities | 1,165 | 1,100 |
Interest receivable | 4,786 | 3,954 |
Financial Liabilities [Abstract] | ||
Deposits | 863,669 | 757,483 |
Interest payable | 362 | 636 |
Fair Value [Member] | ||
Financial Assets [Abstract] | ||
Cash and due from banks | 60,718 | 117,128 |
Interest-bearing time deposits in other banks | 23,384 | 30,147 |
Loans, net of allowance | 869,332 | 700,481 |
Mortgage loans held for sale | 315 | 1,031 |
Nonmarketable equity securities | 1,165 | 1,100 |
Interest receivable | 4,786 | 3,954 |
Financial Liabilities [Abstract] | ||
Deposits | 862,490 | 757,520 |
Interest payable | 362 | 636 |
Fair Value [Member] | Level 1 [Member] | ||
Financial Assets [Abstract] | ||
Cash and due from banks | 60,718 | 117,128 |
Interest-bearing time deposits in other banks | 0 | 0 |
Loans, net of allowance | 0 | 0 |
Mortgage loans held for sale | 0 | 0 |
Nonmarketable equity securities | 0 | 0 |
Interest receivable | 0 | 0 |
Financial Liabilities [Abstract] | ||
Deposits | 0 | 0 |
Interest payable | 0 | 0 |
Fair Value [Member] | Level 2 [Member] | ||
Financial Assets [Abstract] | ||
Cash and due from banks | 0 | 0 |
Interest-bearing time deposits in other banks | 23,384 | 30,147 |
Loans, net of allowance | 864,956 | 698,672 |
Mortgage loans held for sale | 315 | 1,031 |
Nonmarketable equity securities | 1,165 | 1,100 |
Interest receivable | 4,786 | 3,954 |
Financial Liabilities [Abstract] | ||
Deposits | 862,490 | 757,520 |
Interest payable | 362 | 636 |
Fair Value [Member] | Level 3 [Member] | ||
Financial Assets [Abstract] | ||
Cash and due from banks | 0 | 0 |
Interest-bearing time deposits in other banks | 0 | 0 |
Loans, net of allowance | 4,376 | 1,809 |
Mortgage loans held for sale | 0 | 0 |
Nonmarketable equity securities | 0 | 0 |
Interest receivable | 0 | 0 |
Financial Liabilities [Abstract] | ||
Deposits | 0 | 0 |
Interest payable | $ 0 | $ 0 |
Financial Instruments with Off-Balance Sheet Risk (Details) - USD ($) $ in Thousands |
Sep. 30, 2020 |
Dec. 31, 2019 |
---|---|---|
Financial instruments, off-balance sheet credit risk [Abstract] | ||
Financial instruments, off-balance sheet credit risk | $ 192,339 | $ 194,797 |
Commitments to Extend Credit [Member] | ||
Financial instruments, off-balance sheet credit risk [Abstract] | ||
Financial instruments, off-balance sheet credit risk | 191,479 | 191,459 |
Financial and Performance Standby Letters of Credit [Member] | ||
Financial instruments, off-balance sheet credit risk [Abstract] | ||
Financial instruments, off-balance sheet credit risk | $ 860 | $ 3,338 |
Significant Estimates and Concentrations (Details) - USD ($) $ in Thousands |
9 Months Ended | |
---|---|---|
Sep. 30, 2020 |
Dec. 31, 2019 |
|
Significant Estimates of Loans [Abstract] | ||
Outstanding balance | $ 883,222 | $ 708,668 |
Goodwill | 1,000 | |
Hospitality Loans [Member] | ||
Significant Estimates of Loans [Abstract] | ||
Unfunded commitments | $ 47,100 | |
Hospitality Loans [Member] | Gross Loans [Member] | ||
Significant Estimates of Loans [Abstract] | ||
Percentage of gross loans | 21.00% | |
Outstanding balance | $ 188,700 | |
Energy Loans [Member] | ||
Significant Estimates of Loans [Abstract] | ||
Unfunded commitments | $ 16,600 | |
Energy Loans [Member] | Gross Loans [Member] | ||
Significant Estimates of Loans [Abstract] | ||
Percentage of gross loans | 14.00% | |
Outstanding balance | $ 126,000 |
+
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