10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended June 30, 2017

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

For the transition period from to

UNITED COMMUNITY FINANCIAL CORP.

(Exact name of the registrant as specified in its charter)

OHIO	000-024399	34-1856319
(State or other jurisdiction of incorporation)	(Commission File No.)	(IRS Employer I.D. No.)

275 West Federal Street, Youngstown, Ohio 44503-1203

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (330) 742-0500

Not Applicable

(Former name or former address, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes  ☒    No  ☐

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

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☐

Emerging growth company  ☐ 

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

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes  ☐    No  ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. 49,738,735 common shares as of July 31, 2017.

TABLE OF CONTENTS

			PAGE
Part I. FINANCIAL INFORMATION
	Item 1.	Financial Statements	3
	Condensed Consolidated Statements of Financial Condition as of June 30, 2017 (Unaudited) and December 31, 2016		3
	Condensed Consolidated Statements of Income and Comprehensive Income for the Three and Six Months Ended June 30, 2017 and 2016 (Unaudited)		4
	Condensed Consolidated Statement of Shareholders’ Equity for the Six Months ended June 30, 2017and 2016 (Unaudited)		6
	Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2017and 2016 (Unaudited)		7
	Notes to Consolidated Financial Statements (Unaudited)		8-57
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	58-67
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	68
	Item 4.	Controls and Procedures	69
Part II.OTHER INFORMATION			70
	Item 1.	Legal Proceedings	70
	Item 1A.	Risk Factors	70
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	70
	Item 3.	Defaults Upon Senior Securities (None)	70
	Item 4.	Mine Safety Disclosures (None)	70
	Item 5.	Other Information (None)	70
	Item 6.	Exhibits	71
Signatures			72
Exhibits			73

2

PART I—FINANCIAL INFORMATION

ITEM 1. Financial Statements

UNITED COMMUNITY FINANCIAL CORP.

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

(Unaudited)

	June 30,			December 31,
	2017			2016
	(Dollars in thousands)
Assets:
Cash and deposits with banks	$	42,654		$	27,690
Federal funds sold		9,360			18,197
Total cash and cash equivalents		52,014			45,887
Securities:
Available for sale, at fair value		287,179			343,284
Held to maturity, (fair value of $87,775 and $96,150, respectively)		88,559			97,519
Loans held for sale, at lower of cost or market		199			165
Loans held for sale, at fair value		85,954			62,593
Loans, net of allowance for loan losses of $19,660 and $19,087		1,869,095			1,503,577
Federal Home Loan Bank stock, at cost		19,324			18,068
Premises and equipment, net		22,424			20,963
Accrued interest receivable		7,420			6,900
Real estate owned and other repossessed assets, net		1,197			1,777
Goodwill		19,467			208
Customer list intangible		2,060			1,356
Core deposit intangible		2,099			5
Cash surrender value of life insurance		56,628			55,861
Other assets		39,946			33,182
Total assets	$	2,553,565		$	2,191,345
Liabilities and Shareholders' Equity
Liabilities:
Deposits:
Non-interest bearing	$	339,067		$	256,918
Interest bearing
Customer deposits		1,423,327			1,181,557
Brokered deposits		131,599			76,516
Total interest bearing deposits		1,554,926			1,258,073
Total deposits		1,893,993			1,514,991
Borrowed funds:
Federal Home Loan Bank advances
Long-term Federal Home Loan Bank advances		48,146			47,756
Short-term Federal Home Loan Bank advances		280,000			343,000
Total Federal Home Loan Bank advances		328,146			390,756
Repurchase agreements and other		8,045			512
Total borrowed funds		336,191			391,268
Advance payments by borrowers for taxes and insurance		21,989			23,812
Accrued interest payable		392			145
Accrued expenses and other liabilities		15,520			11,323
Total liabilities		2,268,085			1,941,539
Shareholders' Equity:
Preferred stock-no par value; 1,000,000 shares authorized and no shares issued and outstanding		—			—
Common stock-no par value; 499,000,000 shares authorized; 54,138,910 shares issued and    49,715,021 and 46,581,370 shares, respectively, outstanding		177,478			174,360
Retained earnings		159,422			152,675
Accumulated other comprehensive income (loss)		(18,448	)		(21,040	)
Treasury stock, at cost, 4,423,889 and 7,557,540 shares, respectively		(32,972	)		(56,189	)
Total shareholders’ equity		285,480			249,806
Total liabilities and shareholders’ equity	$	2,553,565		$	2,191,345

See Notes to Consolidated Financial Statements.

3

UNITED COMMUNITY FINANCIAL CORP.

CONDENSEDCONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(Unaudited)

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2017			2016			2017			2016
	(Dollars in thousands, except per share data)
Interest income
Loans	$	20,011		$	14,184		$	37,569		$	27,985
Loans held for sale		872			363			1,533			695
Securities available for sale, nontaxable		418			290			836			413
Securities available for sale, taxable		1,479			1,781			3,081			3,716
Securities held to maturity, nontaxable		52			62			114			117
Securities held to maturity, taxable		454			524			919			1,101
Federal Home Loan Bank stock dividends		227			180			441			362
Other interest earning assets		40			15			120			30
Total interest income		23,553			17,399			44,613			34,419
Interest expense
Deposits		1,987			1,496			3,608			3,108
Federal Home Loan Bank advances		1,064			563			2,019			1,093
Repurchase agreements and other		8			6			16			11
Total interest expense		3,059			2,065			5,643			4,212
Net interest income		20,494			15,334			38,970			30,207
Provision for loan losses		842			395			2,317			2,550
Net interest income after provision for loan losses		19,652			14,939			36,653			27,657
Non-interest income
Insurance agency income		472			516			945			818
Brokerage income		301			396			623			696
Deposit related fees		1,411			1,362			2,701			2,688
Mortgage servicing fees		729			701			1,465			1,399
Mortgage servicing rights valuation		(2	)		(292	)		(5	)		(727	)
Mortgage servicing rights amortization		(486	)		(567	)		(935	)		(1,035	)
Other service fees		33			47			62			65
Net gains:
Securities available for sale (includes $301, $233, $330 and $386,    respectively, accumulated other comprehensive income reclassifications    for unrealized net gains on available for sale securities)		301			233			330			386
Mortgage banking income		2,117			1,869			3,440			3,251
Real estate owned and other repossessed assets, net		(18	)		(63	)		(70	)		(76	)
Debit/credit card fees		1,326			1,120			2,249			2,001
Trust fees		420			—			702			—
Other income		486			458			967			972
Total non-interest income		7,090			5,780			12,474			10,438
Non-interest expense
Salaries and employee benefits (includes $0, $(278), $0 and $(556),    respectively, accumulated other comprehensive income reclassifications    from prior service credit on postretirement plan).		8,749			7,186			17,724			14,274
Occupancy		943			855			1,907			1,717
Equipment and data processing		2,306			1,887			4,385			3,722
Financial institutions tax		510			431			1,000			873
Advertising		265			221			389			348
Amortization of intangible assets		113			10			196			23
FDIC insurance premiums		340			287			528			613
Other insurance premiums		109			73			221			162
Legal and consulting fees		184			214			413			411
Other professional fees		420			351			940			421
Real estate owned and other repossessed asset expenses		23			77			85			149
Acquisition costs		—			—			4,962			—
Other expenses		1,214			1,268			2,716			2,611
Total non-interest expenses		15,176			12,860			35,466			25,324
Income before income taxes		11,566			7,859			13,661			12,771
Income tax expense (includes $105, $178, $115 and $329 income tax expense from reclassification items)		3,377			2,529			3,934			4,121
Net income	$	8,189		$	5,330		$	9,727		$	8,650

(Continued)

4

(Continued)

UNITED COMMUNITY FINANCIAL CORP.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(Unaudited)

	For the Three Months Ended June 30,					For the Six Months Ended June 30,
		2017		2016			2017		2016
	(Dollars in thousands, except per share data)
Net income	$	8,189	$	5,330		$	9,727	$	8,650
Other comprehensive income
Unrealized gain on securities, available for sale, net of    reclassifications and tax of $842, $2,392, $1,362 and    $5,852, respectively		1,562		4,442			2,527		10,871
Accretion of unrealized losses on securities transferred from    available for sale to held to maturity, net of tax of $17, $20,    $35 and $38, respectively		32		37			65		71
Accretion of unrecognized actuarial gains and amortization of    prior service credit on postretirement plan, net of tax of $0,    $(97), $0 and $(194), respectively recognized in net income		—		(181	)		—		(362	)
Total other comprehensive income		1,594		4,298			2,592		10,580
Comprehensive income	$	9,783	$	9,628		$	12,319	$	19,230
Earnings per share
Basic	$	0.16	$	0.11		$	0.20	$	0.18
Diluted		0.16		0.11			0.20		0.18

See Notes to Consolidated Financial Statements.

5

UNITED COMMUNITY FINANCIAL CORP.

CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY

(Unaudited)

	Common Shares Outstanding			Common Stock			Retained Earnings			Accumulated Other Comprehensive Income(Loss)			Treasury Stock			Total
	(Dollars in thousands, except per share data)
Balance January 1, 2017		46,581,370		$	174,360		$	152,675		$	(21,040	)	$	(56,189	)	$	249,806
Net income								9,727									9,727
Other comprehensive income											2,592						2,592
Stock option exercises		33,418			(176	)								250			74
Stock option expense					1												1
Restricted stock grants		68,761			(511	)								511			—
Restricted stock expense					456												456
Vesting of Long-term Incentive Plan		68,783			87									510			597
Purchase of Ohio Legacy Corp.		3,033,604			3,261									22,555			25,816
Cash dividend payments ($0.06 per share)								(2,980	)								(2,980	)
Treasury stock purchases		(70,915	)											(609	)		(609	)
Balance June 30, 2017		49,715,021		$	177,478		$	159,422		$	(18,448	)	$	(32,972	)	$	285,480

	Common Shares Outstanding			Common Stock			Retained Earnings			Accumulated Other Comprehensive Income(Loss)			Treasury Stock			Total
	(Dollars in thousands, except per share data)
Balance January 1, 2016		47,517,644		$	174,304		$	140,819		$	(19,220	)	$	(51,658	)	$	244,245
Net income								8,650									8,650
Other comprehensive income											10,580						10,580
Stock option exercises		69,000						(397	)					527			130
Stock option expense					6												6
Restricted stock grants		173,904			(1,031	)		(313	)					1,344			—
Restricted stock forfeitures		(1,014	)		3			7						(10	)		—
Restricted stock expense					462												462
Purchase of James & Sons Insurance		262,705						(541	)					2,049			1,508
Cash dividend payments ($0.05 per share)								(2,381	)								(2,381	)
Treasury stock purchases		(1,529,712	)											(9,125	)		(9,125	)
Balance June 30, 2016		46,492,527		$	173,744		$	145,844		$	(8,640	)	$	(56,873	)	$	254,075

See Notes to Consolidated Financial Statements.

6

UNITED COMMUNITY FINANCIAL CORP.

CONDENSEDCONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	For the Six Months Ended June 30,
	2017			2016
	(Dollars in thousands)
Cash Flows from Operating Activities
Net income	$	9,727		$	8,650
Adjustments to reconcile net income to net cash provided by operating activities
Provision for loan losses		2,317			2,550
Mortgage banking income		(540	)		(1,602	)
Changes in fair value on loans held for sale		(2,900	)		(1,649	)
Net losses on real estate owned and other repossessed assets sold		70			76
Net gain on available for sale securities sold		(330	)		(386	)
Net gain on other assets sold		—			(2	)
Amortization of premiums and accretion of discounts		1,911			4,234
Depreciation and amortization		1,321			1,139
Net change in interest receivable		159			(456	)
Net change in interest payable		176			46
Net change in prepaid and other assets		2,466			(75	)
Net change in other liabilities		2,924			(130	)
Stock based compensation		457			468
Net principal disbursed on loans originated for sale		(114,733	)		(125,930	)
Proceeds from sale of loans held for sale		121,673			119,974
Net change in deferred tax assets		(2,043	)		3,595
Cash surrender value of life insurance		(767	)		(730	)
Tax benefit recognized on stock based compensation		(198	)		—
Net change in interest rate caps		—			3
Net cash from operating activities		21,690			9,775
Cash Flows from Investing Activities
Proceeds from the principal repayments and maturities of securities available for sale		16,063			16,845
Proceeds from the principal repayments and maturities of securities held to maturity		8,732			6,126
Proceeds from the sale of securities available for sale		53,171			28,530
Proceeds from the sale of real estate owned and other repossessed assets		881			1,570
Proceeds from the sale of loans held for investment		2,250			1
Proceeds from the sale of premises and equipment		3			2
Purchases of premises and equipment		(1,547	)		(1,024	)
Principal disbursed on loans, net of repayments		(111,004	)		(69,959	)
Loans purchased		(27,039	)		(15,693	)
Purchase of securities available for sale		—			(38,843	)
Purchase of securities held to maturity		—			(3,200	)
Net cash paid in acquisition of Eich Brothers Insurance		(107	)		—
Net cash received in acquisition of OLCB		25,779			107
Net cash from investing activities		(32,818	)		(75,538	)
Cash Flows from Financing Activities
Net increase in checking, savings and money market accounts		47,573			44,415
Net (decrease) increase in certificates of deposit		65,291			(24,412	)
Net decrease in advance payments by borrowers for taxes and insurance		(2,356	)		(1,575	)
Net change in short-term FHLB advances		(86,500	)		64,000
Net change in repurchase agreements and other borrowed funds		(3,238	)		(12	)
Proceeds from the exercise of stock options		74			130
Dividends paid		(2,980	)		(2,381	)
Purchase of treasury stock		(609	)		(9,125	)
Net cash from financing activities		17,255			71,040
Change in cash and cash equivalents		6,127			5,277
Cash and cash equivalents, beginning of period		45,887			35,910
Cash and cash equivalents, end of period	$	52,014		$	41,187

See Notes to Consolidated Financial Statements

7

UNITED COMMUNITY FINANCIAL CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. BASIS OF PRESENTATION

United Community Financial Corp. (United Community or the Company) was incorporated in the State of Ohio in February 1998 for the purpose of owning all of the outstanding capital stock of Home Savings and Loan Company of Youngstown, Ohio (Home Savings or the Bank) issued upon the conversion of Home Savings from a mutual savings association to a permanent capital stock savings association (Conversion). Upon consummation of the Conversion on July 8, 1998, United Community became the unitary thrift holding company for Home Savings.  Home Savings conducts its business from its main office located in Youngstown, Ohio, 35 retail banking offices and 12 loan production centers located throughout Ohio, western Pennsylvania and West Virginia.  

On January 29, 2016, United Community acquired James & Sons Insurance.  James & Sons Insurance was merged into HSB Insurance, LLC.  HSB Insurance, LLC d/b/a James & Sons Insurance is an insurance agency that offers a wide variety of insurance products for business and residential customers, which include auto, homeowners, life-health, commercial, surety bonds and aviation. On February 28, 2017, James & Sons Insurance acquired Eich Brothers Insurance. Eich Brothers Insurance is an insurance agency that offers insurance products for business and residential customers, which include auto, commercial, home owners and life-health.  

On January 31, 2017, United Community completed its acquisition of Ohio Legacy Corp. (OLCB).  Immediately following the acquisition of OLCB, Home Savings was merged into Premier Bank & Trust, OLCB’s wholly-owned subsidiary state chartered bank (PB&T), and PB&T changed its name to Home Savings Bank.  As a result of the acquisition, United Community issued 3,033,604 United Community common shares and paid $20.4 million to OLCB shareholders.   Also, in connection with the acquisition, United Community became a financial holding company, and its wholly owned subsidiary is now an Ohio bank.

HSB Insurance, Inc., a wholly-owned subsidiary of the Company which was formed and began operations on June 1, 2017, is a Delaware-based captive insurance company which insures against certain risks unique to the operations of the Company and its subsidiaries and for which insurance may not be currently available or economically feasible in today's insurance marketplace. HSB Insurance, Inc. pools resources with several other similar insurance company subsidiaries of financial institutions to spread a limited amount of risk among themselves.  HSB Insurance, Inc. is subject to regulations of the State of Delaware and undergoes periodic examinations by the Delaware Division of Insurance.

The accompanying consolidated financial statements of United Community have been prepared in accordance with instructions relating to Form 10-Q.  Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles (U.S. GAAP) for complete financial statements. However, such information reflects all adjustments (consisting solely of normal recurring adjustments) that are, in the opinion of management, necessary for a fair statement of results for the interim periods.

The results of operations for the three and six months ended June 30, 2017, are not necessarily indicative of the results to be expected for the year ending December 31, 2017. The consolidated financial statements and notes thereto should be read in conjunction with the audited financial statements and notes contained in United Community’s Form 10-K for the year ended December 31, 2016.

The consolidated financial statements include the accounts of United Community and its subsidiaries, Home Savings, HSB Insurance, LLC, HSB Capital, LLC and HSB Insurance, Inc.  All material inter-company transactions have been eliminated.  Some items in the prior year financial statements were reclassified to conform to the current presentation. These reclassifications had no effect on prior year consolidated statements of operations or shareholders’ equity.

2. RECENT ACCOUNTING DEVELOPMENTS

In May 2014, FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606).  The ASU implements a common revenue standard that clarifies the principles for recognizing revenue. The core principle of ASU 2014-09 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply the following steps: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract and (v) recognize revenue when (or as) the entity satisfies a performance obligation. ASU 2014-09 was originally going to be effective on January 1, 2017; however, the FASB recently issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606) – Deferral of the Effective Date which deferred the effective date of ASU 2014-09 by one year to January 1, 2018. United Community’s revenue is comprised of net interest income on financial assets and financial liabilities, which is explicitly excluded from the scope of ASU 2014-09, and non-interest income. We expect that ASU 2014-09 will require us to change how we recognize certain insurance commissions and fees; however,

8

we do not expect these changes to have a significant impact on our financial statements. Additional disclosures will be required to provide quantitative and qualitative information regarding the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. We continue to evaluate the impact of ASU 2014-09 on other components of non-interest income.

In January 2016, the FASB issued ASU 2016-01, Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. ASU 2016-01, among other things, (i) requires equity investments, with certain exceptions, to be measured at fair value with changes in fair value recognized in net income, (ii) simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment, (iii) eliminates the requirement for public business entities to disclose the methods and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet, (iv) requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes, (v) requires an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments, (vi) requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or the accompanying notes to the financial statements and (viii) clarifies that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities. The new guidance is effective for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2017.  Management is currently evaluating the impact of the adoption of this guidance on the Company’s consolidated financial statements and expects revisions to disclosures included in the consolidated financial statements.

In February 2016, the FASB issued ASU 2016-02 - Leases (Topic 842). The ASU will require all organizations that lease assets to recognize on the balance sheet the assets and liabilities for the rights and obligations created by those leases. Additional qualitative and quantitative disclosures will be required so that users can understand more about the nature of an entity’s leasing activities. The new guidance is effective for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2018. Early adoption is permitted. Management is currently evaluating the impact of the adoption of this guidance on the Company’s consolidated financial statements and expects to recognize an increase in other assets and other liabilities for the rights and obligations created by leasing of branch offices.  Management also expects minimal impact in the income statement with respect to occupancy expense related to leases.

In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, which amends ASC Topic 718, Compensation - Stock Compensation. The ASU includes provisions intended to simplify various aspects related to how share-based payments are accounted for and presented in the financial statements.  Key provisions include the elimination of “windfall pools” and removes the requirement to delay recognition of a windfall tax benefit until it reduces current taxes payable.  Additionally, the simplification permits entities to withhold an amount up to the employees’ maximum individual tax rate in the relevant jurisdiction without resulting in a liability classification of the award.  Entities are now permitted to make accounting policy elections for the impact of forfeitures on the recognition of expense for share-based payment awards.  This ASU was adopted on January 1, 2017.  The Company recognized a tax benefit of $198,000 in income tax expense during the six months ended June 30, 2017 as a result of adoption related to vesting of restricted stock awards and exercised stock options.    

In June 2016, FASB Issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.   This ASU adds a new Topic 326 to the Codification and removes the thresholds that companies apply to measure credit losses on financial instruments measured at amortized cost, such as loans, receivables, and held-to-maturity debt securities. Under current U.S. GAAP, companies generally recognize credit losses when it is probable that the loss has been incurred. The revised guidance will remove all recognition thresholds and will require companies to recognize an allowance for credit losses for the difference between the amortized cost basis of a financial instrument and the amount of amortized cost that the company expects to collect over the instrument’s contractual life. ASU 2016-13 also amends the credit loss measurement guidance for available-for-sale debt securities and beneficial interests in securitized financial assets. The guidance in ASU 2016-13 is effective for “public business entities,” as defined, that are SEC filers for fiscal years, and for interim periods with those fiscal years, beginning after December 15, 2019.  Early adoption of the guidance is permitted for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Management is currently evaluating the impact of the adoption of this guidance on the Company’s consolidated financial statements.  Management is aggregating the necessary data requirements and addressing any data-archiving improvements necessary for the implementation of this ASU.

9

In August 2016, FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments, which amends the guidance in ASC 230 on the classification of certain cash receipts and payments in the statement of cash flows. The primary purpose of the ASU is to reduce the diversity in practice that has resulted from the lack of consistent principles on this topic. The ASU’s amendments add or clarify guidance on eight cash flow issues:

• Debt prepayment or debt extinguishment costs.

• Settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing.

• Contingent consideration payments made after a business combination.

• Proceeds from the settlement of insurance claims.

• Proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies.

• Distributions received from equity method investees.

• Beneficial interests in securitization transactions.

• Separately identifiable cash flows and application of the predominance principle.

For public business entities, the guidance in the ASU is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years.  Early adoption is permitted for all entities. Entities must apply the guidance retrospectively to all periods presented but may apply it prospectively from the earliest date practicable if retrospective application would be impracticable.  Management is currently evaluating the impact of the adoption of this guidance on the Company’s consolidated financial statements.

In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. This ASU eliminates Step 2 from the goodwill impairment test. Instead, under the new guidance, an entity is to perform its annual goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge would be recognized for the amount by which the carrying amount exceeds the reporting unit's fair value. The new guidance is effective for annual reporting periods, and interim reporting periods within those annual periods, beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The adoption of this guidance is not expected to have an impact on the Company’s consolidated financial statements.

In March 2017, the FASB issuedASU 2017-08, Receivables - Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities. This ASU amends the amortization period for certain purchased callable debt securities held at a premium. It shortens the amortization period for the premium to the earliest call date. Under current U.S. GAAP, premiums on callable debt securities generally are amortized to the maturity date. The new guidance is effective for annual reporting periods, and interim reporting periods within those annual periods, beginning after December 15, 2018. Early adoption is permitted for interim or annual periods. The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements.

In May 2017, the FASB issuedASU No. 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting . ASU 2017-09 applies to entities that change the terms or conditions of a share-based payment award.  The FASB adopted ASU 2017-09 to provide clarity and reduce diversity in practice as well as cost and complexity when applying the guidance in Topic 718, Compensation—Stock Compensation , to the modification of the terms and conditions of a share-based payment award.

The amendments in ASU 2017-09 include guidance on determining which changes to the terms and conditions of share-based payment awards require an entity to apply modification accounting under Topic 718.

These amendments require the entity to account for the effects of a modification unless all of the following conditions are met:

• The fair value (or calculated value or intrinsic value, if such an alternative measurement method is used) of the modified award is the same as the fair value (or value using an alternative measurement method) of the original award immediately before the original award is modified. If the modification does not affect any of the inputs to the valuation technique that the entity uses to value the award, the entity is not required to estimate the value immediately before and after the modification;

• The vesting conditions of the modified award are the same as the vesting conditions of the original award immediately before the original award is modified; and

• The classification of the modified award as an equity instrument or a liability instrument is the same as the classification of the original award immediately before the original award is modified.

10

The amendments are effective for all entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted, including adoption in any interim period for. The amendments should be applied prospectively to an award modified on or after the adoption date.  The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements.

In July 2017, the FASB ASU No. 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480);Derivatives and Hedging (Topic 815 ): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception.  ASU 2017-11 simplifies the accounting for certain financial instruments with down round features, a provision in an equity-linked financial instrument (or embedded feature) that provides a downward adjustment of the current exercise price based on the price of future equity offerings.

The new ASU will require companies to disregard the down round feature when assessing whether the instrument is indexed to its own stock, for purposes of determining liability or equity classification. Companies that provide earnings per share (EPS) data will adjust their basic EPS calculation for the effect of the feature when triggered (i.e., when the exercise price of the related equity-linked financial instrument is adjusted downward because of the down round feature) and will also recognize the effect of the trigger within equity.

The provisions of the new ASU related to down rounds are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020. Early adoption is permitted for all entities.  The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements.

3. STOCK COMPENSATION

Stock Options:

On April 30, 2015, shareholders approved the United Community Financial Corp. 2015 Long-Term Incentive Compensation Plan (the 2015 Plan). The purpose of the 2015 Plan is to provide a means through which United Community may attract and retain employees and non-employee directors, to provide incentives that align their interest with those of United Community’s shareholders and promote the success of United Community’s business.  All employees and non-employee directors are eligible to participate in the 2015 Plan.  The 2015 Plan provides for the issuance of up to 1,200,000 shares that are to be used for awards of stock options, stock awards, stock units, stock appreciation rights, annual bonus awards and long-term incentive awards.

On April 26, 2007, shareholders approved the United Community Financial Corp. 2007 Long-Term Incentive Plan (as amended, the 2007 Plan). The purpose of the 2007 Plan was to promote and advance the interests of United Community and its shareholders by enabling United Community to attract, retain and reward directors, directors emeritus, managerial and other key employees of United Community, including Home Savings, by facilitating their purchase of an ownership interest in United Community. The 2007 Plan was terminated on April 30, 2015 upon the adoption of the 2015 Plan, although the 2007 Plan survives with respect to awards issued under the 2007 Plan that remain outstanding and exercisable.  The 2007 Plan provided for the issuance of up to 2,000,000 shares that were to be used for awards of restricted stock, stock options, performance awards, stock appreciation rights (SARs), or other forms of stock-based incentive awards.  Because the 2007 Plan terminated, no additional awards may be made under it.

On July 12, 1999, shareholders approved the United Community Financial Corp. 1999 Long-Term Incentive Plan (as amended, the 1999 Plan). The purpose of the 1999 Plan was the same as the 2007 Plan. The 1999 Plan terminated on May 20, 2009, although the 1999 Plan survives with respect to options issued under the 1999 Plan remain outstanding and exercisable. The 1999 Plan provided for the grant of either incentive or nonqualified stock options. Options were awarded at exercise prices that were not less than the fair market value of the share at the grant date. The maximum number of common shares that could be issued under the 1999 Plan was 3,569,766. Because the 1999 Plan terminated, no additional options may be issued under it.

There were no stock options granted in the six months ended June 30, 2017 and 2016. Any options granted must be exercised within 10 years from the date of grant.  Expenses related to prior stock option grants are included with salaries and employee benefits. The Company recognized $0  and $1,000 in stock option expense for the three and six months ended June 30, 2017.  The Company recognized $3,000 and $6,000 in stock option expense for the three and six months ended June 30, 2016. The Company expects to recognize additional expense of $0 for the remainder of 2017.

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A summary of option activity in the plans is as follows:

	For the six months ended
	June 30, 2017
				Weighted		Aggregate
				average		intrinsic value
	Shares			exercise price		(in thousands)
Outstanding at beginning of year		371,218		$	2.55
Granted		—
Exercised		(33,418	)		2.18
Forfeited and expired		(600	)		2.10
Outstanding at end of period		337,200			2.55	$	1,931
Shares subject to options exercisable at end of period		337,200			2.55	$	1,931

Information related to stock options for the three months ended June 30, 2017 and 2016 follows:

	June 30, 2017		June 30, 2016
Intrinsic value of options exercised	$	208,633	$	283,310
Cash received from option exercises		72,818		129,940
Tax benefit realized from option exercises		73,022		—
Weighted average fair value of options granted, per share	$	—	$	—

As of June 30, 2017, the cost of nonvested stock options is expected to be recognized over a weighted-average period of 3 months.

Outstanding stock options at June 30, 2017 have a weighted average remaining life of 2.91 years and may be exercised in the range of $1.20 to $5.89 per share.

Restricted Stock Awards:

The 2007 Plan permitted and the 2015 Plan permits the issuance of restricted stock awards to employees and nonemployee directors. Nonvested shares at June 30, 2017 aggregated 277,168, of which 16,553 are expected to vest during the remainder of 2017, 122,375 in 2018, 105,567 in 2019 and 32,673 in 2020. Expense related to restricted stock awards is charged to salaries and employee benefits and is recognized over the vesting period of the awards based on the fair value of the shares at the grant date. The Company recognized approximately $185,000 and $456,000 in restricted stock award expenses for the three and six months ended June 30, 2017. The Company recognized approximately $247,000 and $462,000 in restricted stock award expense for the three and six months ended June 30, 2016.  The Company expects to recognize additional expenses of approximately $365,000 in 2017, $503,000 in 2018, $210,000 in 2019 and $11,000 in 2020.  The total average per share fair value of shares vested during the six months ended June 30, 2017 was $8.63.

A summary of changes in the Company’s nonvested restricted shares for the six months ended June 30, 2017 is as follows:

	For the six months ended
	June 30, 2017
				Weighted
				average
				grant date
	Shares			fair value
Nonvested at beginning of year		341,184		$	5.50
Granted		68,761		$	8.62
Vested		(132,777	)	$	4.91
Forfeited		—		$	—
Nonvested shares at end of period		277,168		$	6.56

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Annual Incentive Plan

The Annual Incentive Plan (AIP) provides incentive compensation awards to certain officers of the Company. Annual incentive awards are generally based upon the actual performance of the Company and individual participant performance for the twelve months ending December 31, compared to the actual performance of a peer group during the same twelve-month period. The target incentive awards for each year are measured as a percentage of the base salary of participating officers.  Once the awards under the AIP are calculated, they are paid in cash and/or restricted stock. The restricted stock vests equally over three years, beginning on the first anniversary of the date the restricted stock is issued.  The Company incurred $46,000 and $122,000 in expense for the restricted stock portion of the AIP for the three and six months ended June 30, 2017, respectively and $434,000 and $930,000for the cash portion of the AIP for the three and six months ended June 30, 2017, respectively.  The Company incurred $93,000 and $170,000 in expense for the restricted stock portion of the AIP for the three and six months ended June 30, 2016, respectively and $293,000 and $618,000 for the cash portion of the AIP for the three and six months ended June 30, 2016, respectively.  

Long-term Incentive Plan

The Long-term Incentive Plan (LTIP) provides a long-term incentive compensation opportunity to certain executive officers, whose participation and target award opportunities will be approved by the Compensation Committee of the Board of Directors. Each participant in the LTIP will be granted a target number of Performance Share Units (PSUs).  Target PSUs will be determined as a percentage of base salary and translated into share units based on the Company’s average stock price at the appropriate measurement date.  The performance period for the annual grant for a given year will be from January 1, year 1 through December 31, year 3.   The Company incurred $(4,000) and $149,000 for the LTIP for the three and six months ended June 30, 2017, respectively.  The Company incurred $97,000 and $193,000 in expense for the LTIP for the three and six months ended June 30, 2016, respectively.

4. BUSINESS COMBINATION

On January 31, 2017, United Community completed its acquisition of OLCB pursuant to the terms and conditions of the Agreement and Plan of Merger, dated as of September 8, 2016 by and among United Community, the Bank, OLCB and Premier Bank & Trust (Merger Agreement).  Pursuant to the terms of the Merger Agreement, OLCB was merged with and into United Community. Immediately following the merger, Home Savings was merged with and into Premier Bank & Trust, a subsidiary of OLCB, and changed its name to Home Savings Bank.

As a result of the acquisiton and in accordance with the terms of the Merger Agreement, each preferred share of OLCB was deemed to have been converted into OLCB common shares. Each OLCB common share was converted into the right to receive either $18.00 in cash or 2.736 United Community common shares, subject to certain allocation procedures set forth in the Merger Agreement that ensured that 50% of OLCB’s common shares outstanding were converted into United Community common shares and 50% of OLCB’s common shares outstanding were exchanged for the cash consideration. The Company issued cash in lieu of issuing fractional shares.  

After the allocation procedures were applied, the Company issued 3,033,604 United Community common shares and paid $20.4 million to OLCB shareholders as a result of the acquisition.  Acquisition related costs aggregating $5.0 million were included in United Community’s Consolidated Statements of Operations for the six months ended June 30, 2017.  The fair value of the common shares issued as part of the consideration paid for OLCB was determined in the basis of the closing price of United Community’s commons shares on the acquisition date.

The following table summarizes the consideration paid for OLCB.

	(In thousands)
Cash	$	20,379
United Community shares issued		25,816
Total fair value of consideration paid	$	46,195

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At the acquisition date, United Community added the following to the Company’s consolidated statements of financial position:

	(In thousands)
Cash	$	46,159
Loans		259,373
Available for sale securities		9,996
FHLB stock, at cost		1,256
Premises and equipment		2,940
Accrued interest		679
Other intangible assets		2,426
Other real estate owned		89
Other assets		7,988
Total assets acquired	$	330,906
Deposits assumed	$	266,279
Federal Home Loan Bank advances		23,500
Repurchase agreements and other borrowings		10,771
Accrued expenses and other liabilities		2,581
Total liabilities assumed	$	303,131
Goodwill created	$	18,420

The fair value of net assets acquired included fair value adjustments to certain receivables that were not considered impaired as of the acquisition date.  The fair value adjustments were determined using discounted contractual cash flows.  However, the Company believes that all contractual cash flows related to these financial instruments will be collected.  As such, these receivables were not considered impaired at the acquisition date and were not subject to the guidance relating to purchased credit impaired loans, which have shown evidence of credit deterioration since origination.  Receivables acquired that were not subject to these requirements include impaired loans and customer receivables with a fair value and gross contractual amounts receivable of $2.5 million and $2.6 million, respectively, on the date of acquisition.

Upon adoption of ASU 2016-16, Business Combinations (Topic 805), adjustments to provisional amounts booked in previous years are to be adjusted through current year goodwill with the full effect of changes to depreciation, amortization, or other income recorded in current year earnings as if the change had been completed as of the acquisition date.

The following table presents proforma information as if the OLCB acquisition had occurred at the beginning of 2016.  The proforma information includes adjustments for interest income on loans and securities acquired, amortization of intangibles arising from the transaction, depreciation expense on property acquired, interest expense on deposits acquired, and the related income tax effects.  The proforma financial information is not necessarily indicative of the results of operations that would have occurred had the transaction been effected on the assumed dates.  Net income includes the recognition of $4.1 million in acquisiton related expenses incurred by United Community and $368,000 in acquisiton related expenses for OLCB during the six months ended June 30, 2017.  

	For the Six Months Ended June 30,
	2017		2016
	(In thousands, except per share data)
Net interest income	$	39,992	$	36,251
Net income		9,371		10,270
Basic earnings per share	$	0.19	$	0.20
Diluted earnings per share	$	0.19	$	0.20

Goodwill is recorded arising from the acquisition, which consisted largely of synergies and the cost savings resulting from combining the operations of the companies.  No goodwill is expected to be deductible for income tax purposes.  

At the time of the closing, Home Savings charter changed to a state chartered commercial bank and United Community became a financial holding company.

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The acquisition benefits the Company and its shareholders by enabling the Company to further expand into the markets currently served by OLCB and strengthening the competitive position of the combined organization. Furthermore, the Company believes its increased asset size after the acquisition will create additional economies of scale and provide opportunities for asset and earnings growth in an extremely competitive banking environment.  OLCB results of operations were included in the Company’s results beginning January 31, 2017.

The fair value of $2.2 million of intangible assets related to core deposits is subject to change pending final receipt of the final valuation.  

On February 28, 2017, HSB Insurance, LLC completed the purchase of an insurance agency engaged in the business of selling insurance including auto, commercial, homeowners and life-health insurance.  Under the purchase agreement, the Company paid $535,000.  $107,000 was paid in cash at closing and the remaining $428,000 will be paid in four equal installments in connection with this acquisition.  Total assets purchased were $535,000, which is the customer list intangible.

5. SECURITIES

Components of the available for sale portfolio are as follows:

	June 30, 2017
			Gross		Gross
	Amortized		unrealized		unrealized			Fair
	cost		gains		losses			value
	(Dollars in thousands)
Available for Sale
U.S. Treasury and government sponsored entities' securities	$	134,820	$	273	$	(490	)	$	134,603
States of the U.S. and political subdivisions		59,112		387		(675	)		58,824
Mortgage-backed GSE securities: residential		94,173		91		(512	)		93,752
Total	$	288,105	$	751	$	(1,677	)	$	287,179

	December 31, 2016
			Gross		Gross
	Amortized		unrealized		unrealized			Fair
	cost		gains		losses			value
	(Dollars in thousands)
Available for Sale
U.S. Treasury and government sponsored entities' securities	$	188,082	$	172	$	(2,221	)	$	186,033
States of the U.S. and political subdivisions		59,415		3		(1,661	)		57,757
Mortgage-backed GSE securities: residential		100,602		50		(1,158	)		99,494
Total	$	348,099	$	225	$	(5,040	)	$	343,284

Components of held to maturity securities portfolio are as follows:

	June 30, 2017
			Gross		Gross
	Amortized		unrecognized		unrecognized			Fair
	cost		gains		losses			value
	(Dollars in thousands)
Held to maturity
Mortgage-backed GSE securities: residential	$	79,318	$	—	$	(892	)	$	78,426
States of the U.S. and political subdivisions		9,241		109		(1	)		9,349
Total	$	88,559	$	109	$	(893	)	$	87,775

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	December 31, 2016
			Gross		Gross
	Amortized		unrecognized		unrecognized			Fair
	cost		gains		losses			value
	(Dollars in thousands)
Held to maturity
Mortgage-backed GSE securities: residential	$	85,065	$	—	$	(1,300	)	$	83,765
States of the U.S. and political subdivisions		12,454		17		(86	)		12,385
Total	$	97,519	$	17	$	(1,386	)	$	96,150

Debt securities available for sale by contractual maturity, repricing or expected call date are shown below:

	June 30, 2017
	Amortized cost		Fair value
	(Dollars in thousands)
Due in one year or less	$	—	$	—
Due after one year through five years		4,594		4,579
Due after five years through ten years		130,641		130,447
Due after ten years		58,697		58,401
Mortgage-backed GSE securities: residential		94,173		93,752
Total	$	288,105	$	287,179

Debt securities held to maturity by contractual maturity, repricing or expected call date are shown below:

	June 30, 2017
	Amortized cost		Fair value
	(Dollars in thousands)
Due in one year or less	$	—	$	—
Due after one year through five years		—		—
Due after five years through ten years		7,290		7,375
Due after ten years		1,951		1,974
Mortgage-backed GSE securities: residential		79,318		78,426
Total	$	88,559	$	87,775

Securities pledged for public funds were approximately $136.8 million at June 30, 2017 and approximately $146.5 million at December 31, 2016.  

Securities available for sale that have been in an unrealized loss position for less than twelve months or twelve months or more at June 30, 2017 are as follows:

	June 30, 2017
	Less than 12 months					12 months or more				Total
	Fair		Unrealized loss			Fair		Unrealized		Fair		Unrealized
	value		Loss			value		Loss		value		Loss
	(Dollars in thousands)
Description of securities:
U.S. Treasury and government sponsored entities	$	74,259	$	(490	)	$	—	$	—	$	74,259	$	(490	)
States of the U.S. and political subdivisions		37,694		(675	)		—		—		37,694		(675	)
Mortgage-backed GSE securities: residential		71,176		(512	)		—		—		71,176		(512	)
Total temporarily impaired securities	$	183,129	$	(1,677	)	$	—	$	—	$	183,129	$	(1,677	)

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Securities available for sale that have been in an unrealized loss position for less than twelve months or twelve months or more at December 31, 2016 are as follows:

	December 31, 2016
	Less than 12 months					12 months or more				Total
	Fair		Unrealized loss			Fair		Unrealized		Fair		Unrealized
	value		Loss			value		Loss		value		Loss
	(Dollars in thousands)
Description of securities:
U.S. Treasury and government sponsored entities	$	171,411	$	(2,221	)	$	—	$	—	$	171,411	$	(2,221	)
States of the U.S. and political subdivisions		53,283		(1,661	)		—		—		53,283		(1,661	)
Mortgage-backed GSE securities: residential		98,775		(1,158	)		—		—		98,775		(1,158	)
Total temporarily impaired securities	$	323,469	$	(5,040	)	$	—	$	—	$	323,469	$	(5,040	)

All of the U.S. treasury and government sponsored entities and mortgage-backed securities available for sale that were temporarily impaired at June 30, 2017 and December 31, 2016, were impaired due to the level of interest rates at the time of purchase compared to current interest rates. Unrealized losses on these securities have not been recognized into income during the six months ended June 30, 2017 or 2016 because the issuer’s securities are of high credit quality (rated AA or higher), it is likely that management will not be required to sell the securities prior to their anticipated recovery, and the decline in fair value is largely due to changes in interest rates and other market conditions. There is risk that longer term rates could rise further resulting in greater unrealized losses.  The Company expects to realize all interest and principal on these securities and has no intent to sell and more than likely will not be required to sell these securities before their anticipated recovery.

All of the obligations of U.S. states and political subdivisions held for sale that were temporarily impaired at June 30, 2017 and December 31, 2016, were impaired due to the level of interest rates at the time of purchase compared to current interest rates.  Unrealized losses on these securities have not been recognized into income for the six months ended June 30, 2017 or 2016 because the issuer’s securities are of high credit quality (rated AA or higher), it is likely that management will not be required to sell and has no intent to sell the securities prior to their anticipated recovery, and the decline in fair value is largely due to changes in interest rates and other market conditions.

Securities held to maturity that have been in an unrecognized loss position for less than twelve months or twelve months or more are as follows:

	June 30, 2017
	Less than 12 months					12 months or more					Total
	Fair		Unrealized loss			Fair		Unrealized			Fair		Unrealized
	value		Loss			value		Loss			value		Loss
	(Dollars in thousands)
Description of securities:
Mortgage-backed GSE securities: residential	$	53,519	$	(934	)	$	24,907	$	(1,089	)	$	78,426	$	(2,023	)
States of the U.S. and political subdivisions		962		(1	)		—		—			962		(1	)
Total temporarily impaired securities	$	54,481	$	(935	)	$	24,907	$	(1,089	)	$	79,388	$	(2,024	)
	December 31, 2016
	Less than 12 months					12 months or more					Total
	Fair		Unrealized loss			Fair		Unrealized			Fair		Unrealized
	value		Loss			value		Loss			value		Loss
	(Dollars in thousands)
Description of securities:
Mortgage-backed GSE securities: residential	$	57,340	$	(1,243	)	$	26,426	$	(1,287	)	$	83,766	$	(2,530	)
States of the U.S. and political subdivisions		7,416		(86	)							7,416		(86	)
Total temporarily impaired securities	$	64,756	$	(1,329	)	$	26,426	$	(1,287	)	$	91,182	$	(2,616	)

17

During the third quarter of 2015, Home Savings transferred securities with a total amortized cost of $105.3 million with a corresponding fair value of $103.8 million from available for sale to held to maturity.  The net unrealizable loss, net of taxes, on these securities at the date of transfer was $999,000.  The fair value at the date of transfer becomes the securities’ new cost basis.  The unrealized holding loss at the time of transfer continues to be reported in accumulated other comprehensive income, net of tax and is amortized  over the remaining lives of the securities as an adjustment of the yield.  The amortization of the unamortized holding loss reported in accumulated other comprehensive income will directly offset the effect on interest income from the accretion of the reduced amortized cost for the transferred securities.  Because of this transfer, the total losses less than 12 months and greater than 12 months reported in the table above will not agree to the unrealized losses reported in the inventory of held to maturity securities.  The inventory table reports unrealized gains and losses based upon the transferred securities adjusted cost basis and current fair value.  The reporting of losses less than 12 months and greater than 12 months represents that actual period of time that these securities have been in an unrealized loss position and the securities amortized cost basis as if the transfer did not occur.

All of the mortgage-backed securities held to maturity that were temporarily impaired at June 30, 2017 and December 31, 2016, were impaired due to the level of interest rates at the time of purchase compared to current interest rates. Unrealized losses on these securities have not been recognized into income for the six months ended June 30, 2017 or 2016 because the issuer’s securities are of high credit quality (rated AA or higher), it is likely that management will not be required to sell the securities prior to their anticipated recovery, and the decline in fair value is largely due to changes in interest rates and other market conditions. There is risk that longer term rates could rise further resulting in greater unrealized losses.  The Company expects to realize all interest and principal on these securities and has no intent to sell and more than likely will not be required to sell these securities before their anticipated recovery.

All of the obligations of U.S. states and political subdivisions held to maturity that were temporarily impaired at June 30, 2017 and December 31, 2016, were impaired due to the level of interest rates at the time of purchase compared to current interest rates.  Unrealized losses on these securities have not been recognized into income for the six months ended June 30, 2017 or because the issuer’s securities are of high credit quality (rated AA or higher), it is likely that management will not be required to sell and has no intent to sell the securities prior to their anticipated recovery, and the decline in fair value is largely due to changes in interest rates and other market conditions.

Proceeds from the sale of available for sale securities were $48.1 million and $10.4 million, for the three months ended June 30, 2017 and 2016, respectively.  Gross gains of $345,000 and $233,000 were realized on these sales during the three months ended June 30, 2017 and 2016, respectively.  Gross losses of $44,000 and $0 were realized on these sales during the three months ended June 30, 2017 and 2016, respectively.  Income tax expense related to net realized gains and losses was $105,000 and $81,000 for the three months ended June 30, 2017 and 2016, respectively.

Proceeds from the sale of available for sale securities were $53.2 million and $28.5 million, for the six months ended June 30, 2017 and 2016, respectively.  Gross gains of $374,000 and $386,000 were realized on these sales during the six months ended June 30 2017 and 2016, respectively.  Gross losses of $44,000 and $0 were realized on these sales during the six months ended June 30, 2017 and 2016, respectively.  Income tax expense related to net realized gains and losses was $115,000 and $135,000 for the six months ended June 30, 2017 and 2016, respectively.

18

6. LOANS

Portfolio loans consist of the following:

	June 30,			December 31,
	2017			2016
	(Dollars in thousands)
Commercial loans
Multifamily	$	121,565		$	93,597
Nonresidential		342,300			231,401
Land		10,867			8,373
Construction		96,765			68,158
Secured		162,109			95,343
Unsecured		8,649			7,386
Total commercial loans		742,255			504,258
Residential mortgage loans
One-to four-family		834,349			762,926
Construction		56,946			35,695
Total residential mortgage loans		891,295			798,621
Consumer loans
Home equity		187,762			165,054
Auto		50,389			39,609
Marine		1,601			1,796
Recreational vehicle		6,401			7,602
Other		4,998			2,537
Total consumer loans		251,151			216,598
Total loans		1,884,701			1,519,477
Less:
Allowance for loan losses		19,660			19,087
Deferred loan costs, net		(4,054	)		(3,187	)
Total		15,606			15,900
Loans, net	$	1,869,095		$	1,503,577

19

The following tables present the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and are based on impairment method as of June 30, 2017 and December 31, 2016 and activity for the three and six months ended June 30, 2017 and 2016.

Allowance For Loan Losses

	Commercial Loans			Residential Loans			Consumer Loans			Total
	(Dollars in thousands)
For the three months ended June 30, 2017
Beginning balance	$	10,182		$	5,912		$	2,876		$	18,970
Provision		503			295			44			842
Charge-offs		(12	)		(273	)		(150	)		(435	)
Recoveries		148			34			101			283
Ending balance	$	10,821		$	5,968		$	2,871		$	19,660
For the six months ended June 30, 2017
Beginning balance	$	10,824		$	5,538		$	2,725		$	19,087
Provision (recovery)		1,025			865			427			2,317
Charge-offs		(1,323	)		(503	)		(479	)		(2,305	)
Recoveries		295			68			198			561
Ending balance	$	10,821		$	5,968		$	2,871		$	19,660
June 30, 2017
Period-end amount allocated to:
Loans individually evaluated for impairment	$	5		$	1,171		$	440			1,616
Loans collectively evaluated for impairment		10,816			4,797			2,431			18,044
Loans acquired with deteriorated credit quality		—			—			—			—
Ending balance	$	10,821		$	5,968		$	2,871		$	19,660
Period-end balances:
Loans individually evaluated for impairment		2,532			16,190			7,588			26,310
Loans collectively evaluated for impairment		738,502			875,105			243,563			1,857,170
Loans acquired with deteriorated credit quality		1,221			—			—			1,221
Ending balance	$	742,255		$	891,295		$	251,151		$	1,884,701

20

Allowance For Loan Losses

	Commercial Loans			Residential Loans			Consumer Loans			Total
For the three months ended June 30, 2016
Beginning balance	$	8,521		$	5,736		$	2,646		$	16,903
Provision (recovery)		489			(33	)		(61	)		395
Charge-offs		(147	)		(84	)		(276	)		(507	)
Recoveries		95			25			261			381
Ending balance	$	8,958		$	5,644		$	2,570		$	17,172
For the six months ended June 30, 2016
Beginning balance	$	8,077		$	6,630		$	3,005		$	17,712
Provision (recovery)		3,213			(627	)		(36	)		2,550
Charge-offs		(2,493	)		(446	)		(755	)		(3,694	)
Recoveries		161			87			356			604
Ending balance	$	8,958		$	5,644		$	2,570		$	17,172
December 31, 2016
Period-end amount allocated to:
Loans individually evaluated for impairment	$	1,271		$	1,245		$	500		$	3,016
Loans collectively evaluated for impairment		9,553			4,293			2,225			16,071
Ending balance	$	10,824		$	5,538		$	2,725		$	19,087
Period-end balances:
Loans individually evaluated for impairment	$	6,018		$	17,485		$	8,045		$	31,548
Loans collectively evaluated for impairment		498,240			781,136			208,553			1,487,929
Ending balance	$	504,258		$	798,621		$	216,598		$	1,519,477

The allowance for loan losses is a valuation allowance for probable incurred credit losses. Loan losses are charged against the allowance when management believes the uncollectibility of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance. Management estimates the allowance balance required based on an analysis using past loan loss experience, the nature and volume of the portfolio, information about specific borrower situations, estimated collateral values, general economic conditions in the market area and other factors. Allocations of the allowance may be made for specific loans, but the entire allowance is available for any loan that, in management’s judgment, should be charged-off.

Other loans not reviewed specifically by management are evaluated as a homogenous group of loans (generally single-family residential mortgage loans and all consumer credits except marine loans) using a loss factor applied to the outstanding loan balance to determine the level of reserve required. This loss factor consists of two components, a quantitative and a qualitative component. The quantitative component is based on a historical analysis of all charged-off loans, net of recoveries. In determining the qualitative factors, consideration is given to such attributes as lending policies, economic conditions, nature and volume of the portfolio, management, loan quality trend, loan review, collateral value, concentrations, economic cycles and other external factors.  As of June 30, 2017, the Company evaluated 20 quarters of net charge-off history and applied this information to the current period.  This component is combined with the qualitative component to arrive at the loss factor, which is applied to the outstanding balance of homogenous loans.

21

The following table presents loans individually evaluated for impairment by class of loans as of and for six months ended June 30, 2017:

Impaired Loans

(Dollars in thousands)

	Unpaid Principal Balance		Recorded Investment		Allowance for Loan Losses Allocated		Average Recorded Investment		Interest Income Recognized		Cash Basis Income Recognized
With no specific allowance recorded
Commercial loans
Multifamily	$	470	$	413	$	—	$	277	$	3	$	3
Nonresidential		2,030		1,464		—		1,040		50		49
Land		3,922		9		—		17		—		—
Construction		3,593		—		—		—		—		—
Secured		242		190		—		190		—		—
Unsecured		500		—		—		—		—		—
Total commercial loans		10,757		2,076		—		1,524		53		52
Residential mortgage loans
One-to four-family		7,704		5,762		—		6,095		50		41
Construction		—		—		—		—		—		—
Total residential mortgage loans		7,704		5,762		—		6,095		50		41
Consumer loans
Home equity		1,965		1,535		—		1,577		8		7
Auto		34		18		—		11		—		—
Marine		540		169		—		210		—		—
Recreational vehicle		560		152		—		164		5		5
Other		—		—		—		—		—		—
Total consumer loans		3,099		1,874		—		1,962		13		12
Total	$	21,560	$	9,712	$	—	$	9,581	$	116	$	105
With a specific allowance recorded
Commercial loans
Multifamily	$	—	$	—	$	—	$	—	$	—	$	—
Nonresidential		501		456		5		2,164		12		11
Land		—		—		—		—		—		—
Construction		—		—		—		—		—		—
Secured		—		—		—		57		—		—
Unsecured		—		—		—		—		—		—
Total commercial loans		501		456		5		2,221		12		11
Residential mortgage loans
One-to four-family		10,526		10,428		1,171		10,764		273		229
Construction		—		—		—		—		—		—
Total residential mortgage loans		10,526		10,428		1,171		10,764		273		229
Consumer loans
Home equity		4,973		4,919		377		5,212		151		134
Auto		—		—		—		—		—		—
Marine		104		104		1		106		3		3
Recreational vehicle		702		691		62		681		14		13
Other		—		—		—		—		—		—
Total consumer loans		5,779		5,714		440		5,999		168		150
Total		16,806		16,598		1,616		18,984		453		390
Total impaired loans	$	38,366	$	26,310	$	1,616	$	28,565	$	569	$	495

22

The following table presents loans individually evaluated for impairment by class of loans as of and for six months ended June 30, 2016:

Impaired Loans

(Dollars in thousands)

	Unpaid Principal Balance		Recorded Investment		Allowance for Loan Losses Allocated		Average Recorded Investment		Interest Income Recognized		Cash Basis Income Recognized
With no specific allowance recorded
Commercial loans
Multifamily	$	95	$	—	$	—	$	—	$	—	$	—
Nonresidential		1,382		326		—		281		3		3
Land		3,922		384		—		384		—		—
Construction		3,594		—		—		—		—		—
Secured		3,745		3,700		—		3,700		—		—
Unsecured		1,118		—		—		—		—		—
Total commercial loans		13,856		4,410		—		4,365		3		3
Residential mortgage loans
One-to four-family		8,102		6,522		—		6,156		52		42
Construction		—		—		—		—		—		—
Total residential mortgage loans		8,102		6,522		—		6,156		52		42
Consumer loans
Home equity		1,858		1,339		—		1,463		4		4
Auto		16		9		—		11		—		—
Marine		544		302		—		292		—		—
Recreational vehicle		518		273		—		213		2		2
Other		4		4		—		3		—		—
Total consumer loans		2,940		1,927		—		1,982		6		6
Total	$	24,898	$	12,859	$	—	$	12,503	$	61	$	51
With a specific allowance recorded
Commercial loans
Multifamily	$	—	$	—	$	—	$	—	$	—	$	—
Nonresidential		10,854		8,571		922		7,493		124		122
Land		—		—		—		—		—		—
Construction		—		—		—		—		—		—
Secured		1,027		933		93		739		—		—
Unsecured		—		—		—		—		—		—
Total commercial loans		11,881		9,504		1,015		8,232		124		122
Residential mortgage loans
One-to four-family		12,033		12,033		1,333		12,742		297		251
Construction		—		—		—		—		—		—
Total residential mortgage loans		12,033		12,033		1,333		12,742		297		251
Consumer loans
Home equity		6,279		6,279		447		6,791		188		167
Auto		—		—		—		—		—		—
Marine		156		156		4		159		4		4
Recreational vehicle		793		793		85		868		15		14
Other		—		—		—		3		—		—
Total consumer loans		7,228		7,228		536		7,821		207		185
Total		31,142		28,765		2,884		28,795		628		558
Total impaired loans	$	56,040	$	41,624	$	2,884	$	41,298	$	689	$	609

23

The following table presents loans individually evaluated for impairment by class of loans as of December 31, 2016:

Impaired Loans

(Dollars in thousands)

	Unpaid Principal Balance		Recorded Investment		Allowance for Loan Losses Allocated
With no specific allowance recorded
Commercial loans
Multifamily	$	55	$	—	$	—
Nonresidential		2,278		1,489		—
Land		3,922		34		—
Construction		3,594		—		—
Secured		242		190		—
Unsecured		713		—		—
Total commercial loans		10,804		1,713		—
Residential mortgage loans
One-to four-family		8,736		6,758		—
Construction		—		—		—
Total residential mortgage loans		8,736		6,758		—
Consumer loans
Home equity		2,159		1,583		—
Auto		11		3		—
Marine		585		267		—
Recreational vehicle		433		120		—
Other		—		—		—
Total consumer loans		3,188		1,973		—
Total	$	22,728	$	10,444	$	—
With a specific allowance recorded
Commercial loans
Multifamily	$	—	$	—	$	—
Nonresidential		6,930		4,133		1,193
Land		—		—		—
Construction		—		—		—
Secured		237		172		78
Unsecured		—		—		—
Total commercial loans		7,167		4,305		1,271
Residential mortgage loans
One-to four-family		10,810		10,727		1,245
Construction		—		—		—
Total residential mortgage loans		10,810		10,727		1,245
Consumer loans
Home equity		5,390		5,335		426
Auto		—		—		—
Marine		108		108		1
Recreational vehicle		639		629		73
Other		—		—		—
Total consumer loans		6,137		6,072		500
Total		24,114		21,104		3,016
Total impaired loans	$	46,842	$	31,548	$	3,016

The unpaid principal balance is the total amount of the loan that is due to Home Savings. The recorded investment includes the unpaid principal balance less any charge-offs or partial charge-offs applied to specific loans. The unpaid principal balance and the recorded investment both exclude accrued interest receivable and deferred loan costs, both of which are immaterial.

24

The following table presents loans individually evaluated for impairment by class of loans as of and for the three months ended June 30, 2017:

	Average Recorded Investment		Interest Income Recognized		Cash Basis Income Recognized
With no specific allowance recorded
Commercial loans
Multifamily	$	416	$	—	$	—
Nonresidential		815		25		25
Land		9		—		—
Construction		—		—		—
Secured		190		—		—
Unsecured		—		—		—
Total commercial loans		1,430		25		25
Residential mortgage loans
One-to four-family		5,763		20		20
Construction		—		—		—
Total residential mortgage loans		5,763		20		20
Consumer loans
Home equity		1,574		3		3
Auto		16		—		—
Marine		182		—		—
Recreational vehicle		186		2		2
Other				—		—
Total consumer loans		1,958		5		5
Total	$	9,151	$	50	$	50
With a specific allowance recorded
Commercial loans
Multifamily	$	—	$	—	$	—
Nonresidential		1,179		5		5
Land		—		—		—
Construction		—		—		—
Secured				—		—
Unsecured		—		—		—
Total commercial loans		1,179		5		5
Residential mortgage loans
One-to four-family		10,783		114		111
Construction		—		—		—
Total residential mortgage loans		10,783		114		111
Consumer loans
Home equity		5,151		66		66
Auto		—		—		—
Marine		105		1		1
Recreational vehicle		708		7		6
Other		—		—		—
Total consumer loans		5,964		74		73
Total		17,926		193		189
Total impaired loans	$	27,077	$	243	$	239

25

The following table presents loans individually evaluated for impairment by class of loans as of and for the three months ended June 30, 2016:

	Average Recorded Investment		Interest Income Recognized		Cash Basis Income Recognized
With no specific allowance recorded
Commercial loans
Multifamily	$	—	$	—	$	—
Nonresidential		269		1		1
Land		384		—
Construction		—		—		—
Secured		3,700		—		—
Unsecured		—		—		—
Total commercial loans		4,353		1		1
Residential mortgage loans
One-to four-family		6,302		17		17
Construction		—		—		—
Total residential mortgage loans		6,302		17		17
Consumer loans
Home equity		1,336		1		1
Auto		9		—		—
Marine		303		—		—
Recreational vehicle		281		1		1
Other		4		—		—
Total consumer loans		1,933		2		2
Total	$	12,588	$	20	$	20
With a specific allowance recorded
Commercial loans
Multifamily	$	—	$	—	$	—
Nonresidential		8,748		15		15
Land		—		—		—
Construction		—		—		—
Secured		947		—		—
Unsecured		—		—		—
Total commercial loans		9,695		15		15
Residential mortgage loans
One-to four-family		12,372		124		122
Construction		—		—		—
Total residential mortgage loans		12,372		124		122
Consumer loans
Home equity		6,568		84		82
Auto		—		—		—
Marine		158		2		2
Recreational vehicle		741		8		8
Other		—		—		—
Total consumer loans		7,467		94		92
Total		29,534		233		229
Total impaired loans	$	42,122	$	253	$	249

26

Home Savings reclassifies a collateralized mortgage loan and a consumer loan secured by real estate to real estate owned and other repossessed assets once it has either obtained legal title to the real estate collateral or the borrower voluntarily conveys all interest in the real property to the Bank to satisfy the loan through a deed in lieu of foreclosure or similar legal agreement.  The table below presents loans that are in the process of foreclosure at June 30, 2017 and December 31, 2016, but legal title, deed in lieu of foreclosure or similar legal agreement to the property has not yet been obtained:

	June 30, 2017				December 31, 2016
	Unpaid Principal Balance		Recorded Investment		Unpaid Principal Balance		Recorded Investment
	(Dollars in thousands)				(Dollars in thousands)
Mortgage loans in process of foreclosure	$	3,188	$	2,816	$	3,025	$	2,576
Consumer loans in process of foreclosure		931		751		1,069		795

The following table presents the recorded investment in nonaccrual loans and loans past due over 90 days and still on accrual by class of loans as of June 30, 2017:

Nonaccrual Loans and Loans Past Due Over 90 Days and Still Accruing

As of June 30, 2017

	Nonaccrual		Loans past due over 90 days and still accruing
	(Dollars in thousands)
Commercial loans
Multifamily	$	413	$	—
Nonresidential		1,331		—
Land		9		—
Construction		—		—
Secured		190		—
Unsecured		—		—
Total commercial loans		1,943		—
Residential mortgage loans
One-to four-family		6,701		—
Construction		—		—
Total residential mortgage loans		6,701		—
Consumer Loans
Home equity		1,707		—
Auto		94		—
Marine		169		—
Recreational vehicle		166		—
Other		1		2
Total consumer loans		2,137		2
Total nonaccrual loans and loans past due over 90 days and still accruing	$	10,781	$	2

27

The following table presents the recorded investment in nonaccrual loans and loans past due over 90 days and still on accrual by class of loans as of December 31, 2016:

Nonaccrual Loans and Loans Past Due Over 90 Days and Still Accruing

As of December 31, 2016

	Nonaccrual		Loans past due over 90 days and still accruing
	(Dollars in thousands)
Commercial loans
Multifamily	$	—	$	—
Nonresidential		3,546		—
Land		34		—
Construction		—		—
Secured		361		—
Unsecured		—		—
Total commercial loans		3,941		—
Residential mortgage loans
One-to four-family		6,084		—
Construction		—		—
Total residential mortgage loans		6,084		—
Consumer Loans
Home equity		1,936		—
Auto		31		—
Marine		267		—
Recreational vehicle		178		—
Other		2		—
Total consumer loans		2,414		—
Total nonaccrual loans and loans past due over 90 days and still accruing	$	12,439	$	—

28

The following table presents an age analysis of past-due loans, segregated by class of loans as of June 30, 2017:

Past Due Loans

(Dollars in thousands)

	30-59 Days Past Due		60-89 Days Past Due		Greater than 90 Days Past Due		Total Past Due		Current Loans		Total Loans
Commercial loans
Multifamily	$	—	$	187	$	—	$	187	$	121,378	$	121,565
Nonresidential		199		—		153		352		341,948		342,300
Land		—		—		9		9		10,858		10,867
Construction		—		—		—		—		96,765		96,765
Secured		135		22		189		346		161,763		162,109
Unsecured		—		—		—		—		8,649		8,649
Total commercial loans		334		209		351		894		741,361		742,255
Residential mortgage loans
One-to four-family		2,643		1,584		5,646		9,873		824,476		834,349
Construction		—		—		—		—		56,946		56,946
Total residential mortgage loans		2,643		1,584		5,646		9,873		881,422		891,295
Consumer Loans:
Home equity		1,141		113		1,429		2,683		185,079		187,762
Automobile		123		119		17		259		50,130		50,389
Marine		—		—		169		169		1,432		1,601
Recreational vehicle		199		149		95		443		5,958		6,401
Other		2		4		3		9		4,989		4,998
Total consumer loans		1,465		385		1,713		3,563		247,588		251,151
Total loans	$	4,442	$	2,178	$	7,710	$	14,330	$	1,870,371	$	1,884,701

29

The following table presents an age analysis of past-due loans, segregated by class of loans as of December 31, 2016:

Past Due Loans

(Dollars in thousands)

	30-59 Days Past Due		60-89 Days Past Due		Greater than 90 Days Past Due		Total Past Due		Current Loans		Total Loans
Commercial loans
Multifamily	$	—	$	—	$	—	$	—	$	93,597	$	93,597
Nonresidential		3,511		—		61		3,572		227,829		231,401
Land		—		—		34		34		8,339		8,373
Construction		—		—		—		—		68,158		68,158
Secured		—		—		361		361		94,982		95,343
Unsecured		—		—		—		—		7,386		7,386
Total commercial loans		3,511		—		456		3,967		500,291		504,258
Residential mortgage loans
One-to four-family		3,774		1,717		5,461		10,952		751,974		762,926
Construction		—		—		—		—		35,695		35,695
Total residential mortgage loans		3,774		1,717		5,461		10,952		787,669		798,621
Consumer Loans:
Home equity		941		458		1,669		3,068		161,986		165,054
Automobile		130		—		3		133		39,476		39,609
Marine		—		—		267		267		1,529		1,796
Recreational vehicle		131		347		—		478		7,124		7,602
Other		1		3		2		6		2,531		2,537
Total consumer loans		1,203		808		1,941		3,952		212,646		216,598
Total loans	$	8,488	$	2,525	$	7,858	$	18,871	$	1,500,606	$	1,519,477

As of June 30, 2017 and December 31, 2016, the Company has a recorded investment in troubled debt restructurings of $22.2 million and $26.6 million, respectively.  The Company allocated $1.6 million of specific allowance for those loans at June 30, 2017 and $3.0 million at December 31, 2016.  The Company has committed to lend additional amounts totaling up to $35,000 and $31,000 at June 30, 2017 and December 31, 2016, respectively.  

There were no loans modified as troubled debt restructurings that occurred during the three months ended June 30, 2017.

The troubled debt restructurings described above had no effect on the allowance for loan losses and resulted in no charge-offs during the three months ended June 30, 2017.

30

The following table presents loans by class modified as troubled debt restructurings that occurred during the six months ended June 30, 2017:

	Number of Loans		Pre-Modification Outstanding Recorded Investment		Post-Modification Recorded Investment
			(In thousands)
Commercial loans
Multifamily		—	$	—	$	—
Nonresidential
Land		—		—		—
Construction		—		—		—
Secured		—		—		—
Unsecured		—		—		—
Total commercial loans		—		—		—
Residential mortgage loans
One-to four-family		1		75		84
Construction		—		—		—
Total residential mortgage loans		1		75		84
Consumer loans
Home equity		—		—		—
Auto		—		—		—
Marine		—		—		—
Recreational vehicle		1		115		115
Other		—		—		—
Total consumer loans		1		115		115
Total restructured loans		2	$	190	$	199

The troubled debt restructurings described above increased the allowance for loan losses by $6,000 and resulted in no charge-offs during the six months ended June 30, 2017.

31

The following table presents loans by class modified as troubled debt restructurings that occurred during the three months ended June 30, 2016:

	Number of Loans		Pre-Modification Outstanding Recorded Investment		Post-Modification Recorded Investment
			(Dollars in thousands)
Commercial loans
Multifamily		—	$	—	$	—
Nonresidential		1		4,000		4,000
Land		—		—		—
Construction		—		—		—
Secured		—		—		—
Unsecured		—		—		—
Total commercial loans		1		4,000		4,000
Residential mortgage loans
One-to four-family		1		97		98
Construction		—		—		—
Total residential mortgage loans		1		97		98
Consumer loans
Home equity		2		110		114
Auto		—		—		—
Marine		—		—		—
Recreational vehicle		—		—		—
Other		—		—		—
Total consumer loans		2		110		114
Total restructured loans		4	$	4,207	$	4,212

The troubled debt restructurings described above increased the allowance for loan losses by $6,000, and resulted in no charge-offs during the three months ended June 30, 2016.

32

The following table presents loans by class modified as troubled debt restructurings that occurred during the six months ended June 30, 2016:

	Number of Loans		Pre-Modification Outstanding Recorded Investment		Post-Modification Recorded Investment
			(Dollars in thousands)
Commercial loans
Multifamily		—	$	—	$	—
Nonresidential		2		4,088		4,088
Land		—		—		—
Construction		—		—		—
Secured		—		—		—
Unsecured		—		—		—
Total commercial loans		2		4,088		4,088
Residential mortgage loans
One-to four-family		3		316		335
Construction		—		—		—
Total residential mortgage loans		3		316		335
Consumer loans
Home equity		3		130		134
Auto		—		—		—
Marine		—		—		—
Recreational vehicle		—		—		—
Other		—		—		—
Total consumer loans		3		130		134
Total restructured loans		8	$	4,534	$	4,557

The troubled debt restructurings described above increased the allowance for loan losses by $11,000 and resulted in no charge-offs during the six months ended June 30, 2017.

33

The following table presents loans by class modified as troubled debt restructurings for which there was a payment default within a twelve-month cycle following the modification during the period ended June 30, 2017.

	Number of loans		Recorded Investment
			(Dollars in thousands)
Commercial loans
Multifamily		—	$	—
Nonresidential		—		—
Land		—		—
Construction		—		—
Secured		—		—
Unsecured		—		—
Total commercial loans		—		—
Residential mortgage loans
One-to four-family		1		164
Construction		—		—
Total residential mortgage loans		1		164
Consumer loans
Home equity		1		47
Auto		—		—
Marine		—		—
Recreational vehicle		—		—
Other		—		—
Total consumer loans		1		47
Total restructured loans		2	$	211

The troubled debt restructurings that subsequently defaulted described above resulted in no charge-offs during the three and six months ended June 30, 2017, and had no effect on the provision for loan losses.

The following table presents loans by class modified as troubled debt restructurings for which there was a payment default within a twelve month cycle following the modification during the period ended June 30, 2016:

	Number of loans		Recorded Investment
			(Dollars in thousands)
Commercial loans
Multifamily		—	$	—
Nonresidential		—		—
Land		—		—
Construction		—		—
Secured		—		—
Unsecured		—		—
Total commercial loans		—		—
Residential mortgage loans
One-to four-family		—		—
Construction		—		—
Total residential mortgage loans		—		—
Consumer loans
Home equity		—		—
Auto		—		—
Marine		—		—
Recreational vehicle		—		—
Other		—		—
Total consumer loans		—		—
Total restructured loans		—	$	—

34

The troubled debt restructurings that subsequently defaulted described above resulted in no of charge-offs during the three and six months ended June 30, 2016, and had no effect on the provision for loan losses.

A troubled debt restructuring is considered to be in payment default once it is 30 days contractually past due under the modified terms.

In order to determine whether a borrower is experiencing financial difficulty, an evaluation is performed of the probability that the borrower will be in payment default on any of its debt in the foreseeable future without the modification. This evaluation is performed in accordance with the Company’s internal underwriting policy.

Credit Quality Indicators:

The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt, such as: current financial information, historical payment experience, credit documentation, public information and current economic trends. The Company analyzes loans individually by classifying the loans as to credit risk. This analysis includes homogeneous loans past due 90 cumulative days, and all non-homogeneous loans, including commercial loans and commercial real estate loans. Smaller balance homogeneous loans are primarily monitored by payment status.

Asset quality ratings are divided into two groups: Pass (unclassified) and Classified. Within the unclassified group, certain loans that display potential weakness are risk rated as special mention. In addition, there are three classified risk ratings: substandard, doubtful and loss. These specific credit risk categories are defined as follows:

Special Mention. Loans classified as special mention have potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.

Substandard. Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

Doubtful. Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable.

Loss. Loans classified as loss are considered uncollectible and of such little value, that continuance as assets is not warranted. Although there may be a chance of recovery on these assets, it is not practical or desirable to defer writing off the asset.

The Company monitors loans on a monthly basis to determine if they should be included in one of the categories listed above. All impaired non-homogeneous credits classified as substandard, doubtful or loss are analyzed on an individual basis for a specific reserve requirement. This analysis is performed on each individual credit at least annually or more frequently if warranted.

35

As of June 30, 2017 and December 31, 2016, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:

Loans

June 30, 2017

(Dollars in thousands)

	Unclassified				Classified
	Unclassified		Special Mention		Substandard		Doubtful		Loss		Total Classified		Total Loans
Commercial Loans
Multifamily	$	117,375	$	3,482	$	708	$	—	$	—	$	708	$	121,565
Nonresidential		333,010		3,208		6,082		—		—		6,082		342,300
Land		10,858		—		9		—		—		9		10,867
Construction		96,362		403		—		—		—		—		96,765
Secured		134,433		10,839		16,837		—		—		16,837		162,109
Unsecured		8,555		—		94		—		—		94		8,649
Total commercial loans		700,593		17,932		23,730		—		—		23,730		742,255
Residential mortgage loans
One-to four-family		825,270		779		8,300		—		—		8,300		834,349
Construction		56,946		—		—		—		—		—		56,946
Total residential mortgage loans		882,216		779		8,300		—		—		8,300		891,295
Consumer Loans
Home equity		186,055		—		1,707		—		—		1,707		187,762
Auto		50,258		—		131		—		—		131		50,389
Marine		1,432		—		169		—		—		169		1,601
Recreational vehicle		6,234		—		167		—		—		167		6,401
Other		4,997		—		1		—		—		1		4,998
Total consumer loans		248,976		—		2,175		—		—		2,175		251,151
Total loans	$	1,831,785	$	18,711	$	34,205	$	—	$	—	$	34,205	$	1,884,701

36

Loans

December 31, 2016

(Dollars in thousands)

	Unclassified				Classified
	Unclassified		Special Mention		Substandard		Doubtful		Loss		Total Classified		Total Loans
Commercial Loans
Multifamily	$	89,468	$	3,564	$	565	$	—	$	—	$	565	$	93,597
Nonresidential		217,204		6,037		8,160		—		—		8,160		231,401
Land		8,339		—		34		—		—		34		8,373
Construction		68,158		—		—		—		—		—		68,158
Secured		89,756		3,420		2,167		—		—		2,167		95,343
Unsecured		7,291		—		95		—		—		95		7,386
Total commercial loans		480,216		13,021		11,021		—		—		11,021		504,258
Residential mortgage loans
One-to four-family		754,996		104		7,826		—		—		7,826		762,926
Construction		35,695		—		—		—		—		—		35,695
Total residential mortgage loans		790,691		104		7,826		—		—		7,826		798,621
Consumer Loans
Home equity		163,101		—		1,953		—		—		1,953		165,054
Auto		39,577		1		31		—		—		31		39,609
Marine		1,530		—		266		—		—		266		1,796
Recreational vehicle		7,424		—		178		—		—		178		7,602
Other		2,535		—		2		—		—		2		2,537
Total consumer loans		214,167		1		2,430		—		—		2,430		216,598
Total loans	$	1,485,074	$	13,126	$	21,277	$	—	$	—	$	21,277	$	1,519,477

Purchased Credit Impaired Loans:

The Company has purchased loans, for which there was, at acquisition, evidence of deterioration of credit quality since origination and it was probable, at acquisition, that all contractually required payments would not be collected.  The carrying amount of those loans is as follows:

	June 30, 2017
	(Dollars in thousands)
Commercial loans	$	1,221
Residential mortgage loans		—
Consumer loans		—
Outstanding balance	$	1,221
Carrying amount, net of allowance of $0	$	1,221

Accretable yield, or income expected to be collected, is as follows:

	Three Months Ended		Six Months Ended
	June 30, 2017		June 30, 2017
			(Dollars in thousands)
Beginning of period	$	128	$	—
New loans purchased		—		158
Accretion of income		12		42
Balance at June 30	$	116	$	116

For the purchased credit impaired loans disclosed above, there was no change in the allowance for loan losses for the three and six months ended June 30, 2017.  

37

Purchased credit impaired loans purchased during the six months ended June 30, 2017 for which it was probable at acquisition that all contractually required payments would not be collected are as follows:

	June 30, 2017
	(Dollars in thousands)
Contractually required payments receivable of   loans purchased during the year:
Commercial loans	$	4,499
Residential mortgage loans		—
Consumer loans		—
	$	4,499
Cash flow expected to be collected at acquisition	$	1,955
Fair value of acquired loans at acquisition		1,797

Income is not recognized on purchased credit impaired loans if the Company cannot reasonably estimate cash flows expected to be collected.  The carrying amounts of such loans are as follows:

	June 30, 2017
	(Dollars in thousands)
Loans at beginning of year	$	—
Loans purchased during the year		1,797
Loans at end of period		1,221

7. MORTGAGE BANKING ACTIVITIES

Mortgage loans serviced for others, which are not reported in United Community’s assets, totaled $1.2 billion as of June 30, 2017 and $1.2 billion as of December 31, 2016. Mortgage banking income is comprised of gains recognized on the sale of loans and changes in fair value of mortgage banking derivatives.

The principal balances of mortgage loans serviced for others are as follows:

	June 30, 2017		December 31, 2016
	(Dollars in thousands)
Mortgage loan portfolios serviced for:
FHLMC	$	963,748	$	956,278
FNMA		213,848		208,114
Private investor		27,917		—

During the second quarter of 2017, the Company sold $27.9 million of adjustable rate 1-4 family mortgages to a private investor in a bulk mortgage loan sale.  The Company recognized 45 basis points of mortgage service release premium as part of the gain recognized on this sale.   Customer escrow balances with loans serviced for FHLMC, FNMA and the private investor totaled $12.1 million and $14.3 million at June 30, 2017 and December 31, 2016, respectively.

Activity for capitalized mortgage servicing rights, included in other assets, was as follows:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2017			2016			2017			2016
	(Dollars in thousands)
Balance, beginning of period	$	5,977		$	5,727		$	6,070		$	5,686
Originations		670			653			1,026			1,162
Amortized to expense		(486	)		(567	)		(935	)		(1,035	)
Balance, end of period		6,161			5,813			6,161			5,813
Less valuation allowance		(5	)		(766	)		(5	)		(766	)
Net balance	$	6,156		$	5,047		$	6,156		$	5,047

38

Activity in the valuation allowance for mortgage servicing rights was as follows:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2017			2016			2017			2016
	(Dollars in thousands)
Balance, beginning of period	$	(3	)	$	(474	)	$	—		$	(39	)
Impairment charges		(2	)		(292	)		(5	)		(727	)
Recoveries		—			—			—			—
Balance, end of period	$	(5	)	$	(766	)	$	(5	)	$	(766	)

The fair value of mortgage servicing rights as of June 30, 2017, was approximately $10.3 million and at December 31, 2016, the fair value was approximately $10.2 million.

Key economic assumptions in measuring the value of mortgage servicing rights at June 30, 2017, and December 31, 2016, were as follows:

	June 30, 2017		December 31, 2016
Weighted average prepayment rate	178 PSA		165 PSA
Weighted average life (in years)	6.38		6.64
Weighted average discount rate		9.06%		9.00%

8. OTHER REAL ESTATE OWNED AND OTHER REPOSSESSED ASSETS

Real estate owned and other repossessed assets at June 30, 2017 and December 31, 2016 were as follows:

	June 30, 2017			December 31, 2016
	(Dollars in thousands)
Real estate owned and other repossessed assets	$	1,586		$	2,789
Valuation allowance		(389	)		(1,012	)
End of period	$	1,197		$	1,777

Activity in the valuation allowance was as follows:

	Three Months Ended						Six Months Ended
	June 30, 2017			June 30, 2016			June 30, 2017			June 30, 2016
	(Dollars in thousands)
Beginning of period	$	549		$	1,124		$	1,012		$	1,229
Recovery of expense		—			(27	)		(38	)		(26	)
Reductions due to sales		(160	)		(96	)		(585	)		(202	)
End of period	$	389		$	1,001		$	389		$	1,001

Expenses related to foreclosed and repossessed assets include:

	Three Months Ended					Six Months Ended
	June 30, 2017		June 30, 2016			June 30, 2017			June 30, 2016
	(Dollars in thousands)
Net loss on sales	$	18	$	90		$	108		$	102
Provision for unrealized (gains) losses , net		—		(27	)		(38	)		(26	)
Operating expenses, net of rental income		23		77			85			149
Total expenses	$	41	$	140		$	155		$	225

39

9. FAIR VALUE MEASUREMENT

Fair value is the exchange price that would be received for an asset if paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There are three levels of inputs that may be used to measure fair value:

Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level 2: Significant other observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3: Significant unobservable inputs that reflect a reporting entity’s own beliefs about the assumptions that market participants would use in pricing an asset or liability.

United Community uses the following methods and significant assumptions to estimate the fair value of each type of financial instrument:

Available for sale securities: The fair values of securities available for sale are determined by obtaining quoted prices on nationally recognized securities exchanges (Level 1 inputs). For securities where quoted prices are not available, fair values are calculated based on market prices of similar securities (Level 2), using matrix pricing.  Matrix pricing is a mathematical technique commonly used to price debt securities that are not actively traded, values debt securities without relying on the securities’ relationship to other benchmark quoted securities (Level 2 inputs).

Impaired loans: At the time a loan is considered impaired, it is valued at the lower of cost or fair value. Impaired loans carried at fair value generally receive specific allocations of the allowance for loan losses. For collateral dependent loans, fair value is commonly based on recent real estate appraisals. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are usually significant and typically result in a Level 3 classification of the inputs for determining fair value. Non-real estate collateral may be valued using an appraisal, net book value per the borrower’s financial statements, or aging reports, adjusted or discounted based on management’s historical knowledge, changes in market conditions from the time of the valuation, and management’s expertise and knowledge of the client and client’s business, resulting in a Level 3 fair value classification. Impaired loans are evaluated on a quarterly basis for additional impairment and adjusted accordingly.

Other real estate owned: Assets acquired through or instead of loan foreclosure are initially recorded at fair value less costs to sell when acquired, establishing a new cost basis. These assets are subsequently accounted for at lower of cost or fair value less estimated costs to sell. Fair value is commonly based on recent real estate appraisals. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are usually significant and typically result in a Level 3 classification of the inputs for determining fair value. Real estate owned properties are individually evaluated at least annually for additional impairment and adjusted accordingly.

Appraisals for both collateral-dependent impaired loans and other real estate owned are performed by certified general appraisers (for commercial properties) or certified residential appraisers (for residential properties) whose qualifications and licenses have been reviewed and verified by Home Savings. Once received, a member of the Special Assets Department reviews the assumptions and approaches utilized in the appraisal as well as the overall resulting fair value in comparison with the independent data sources such as recent market data or industry-wide statistics. In addition to the Special Assets Department review, a third party independent review is also performed.  On an annual basis, Home Savings compares the actual selling price of collateral that has been sold to the most recent appraised value to determine what additional adjustment should be made to the appraisal value to arrive at fair value. At the time a property is acquired and classified as real estate owned, the fair value is determined utilizing the most appropriate method. A fair value in excess of $250,000 will be supported by an appraisal. After determination of fair value, each property will be recorded at the lower of cost (i.e., recorded investment in the loan) or the estimated net realizable value on the date of transfer to real estate owned. In determining net realizable value, reductions to fair market value may be taken for estimated costs of sale, conditions that must be remedied immediately upon acquisition, and other factors that negatively impact the marketability and prompt sale of the property.

40

Mortgage servicing rights: On a quarterly basis, loan servicing rights are evaluated for impairment based upon the fair value of the rights as compared to carrying amount. If the carrying amount of an individual tranche exceeds fair value, impairment is recorded on that tranche so that the servicing asset is carried at fair value. Fair value is determined at a tranche level, based on market prices for comparable mortgage servicing contracts, when available, or alternatively based on a valuation model that calculates the present value of estimated future net servicing income. The valuation model utilizes assumptions that market participants would use in estimating future net servicing income and that can be validated against available market data (Level 2).

Loans held for sale: Loans held for sale are carried at the lower of cost or fair value, which is evaluated on a pool-level basis. The fair value of loans held for sale is determined using quoted prices for similar assets, adjusted for specific attributes of that loan or other observable market data, such as outstanding commitments from third party investors (Level 2).

Loans held for sale, at fair value:  The Company elected the fair value option for all conventional residential one-to four-family loans held for sale originated after January 1, 2016 and all permanent construction loans held for sale originated on or after January 1, 2015.   The fair value of conventional loans held for sale is determined using the current 15 day forward contract price for either 15 or 30 year conventional mortgages (Level 2)

The fair value of the Company’s permanent construction loans held for sale is determined using the current 60 day forward contract price for 30 year conventional loans which is then adjusted by extrapolating this rate to the estimated time period remaining until construction is complete.  The fair value is also adjusted for unobservable market data such as estimated fall out rates and the estimated time from origination to completion of construction (Level 3).  

Interest rate caps: Home Savings uses an independent third party that performs a market valuation analysis for interest rate caps. The methodology used consists of a discounted cash flow model, all future floating cash flows are projected and both floating and fixed cash flows are discounted to the valuation date. The yield curve utilized for discounting and projecting is built by obtaining publicly available third party market quotes from Reuters, which handle up to 30-year swap maturities (Level 3). Assumptions used in the valuation of interest rate caps are back-tested for reasonableness on a quarterly basis using an independent source along with a third party service.

Purchased and written certificate of deposit option: Home Savings periodically enters into written and purchased option derivative instruments to facilitate the Power CD. The written and purchased options are mirror derivative instruments which are carried at fair value on the consolidated balance sheets. Home Savings uses an independent third party that performs a market valuation analysis for purchased and written certificate of deposit options. (Level 2)

Assets and Liabilities Measured on a Recurring Basis: Assets and liabilities measured at fair value on a recurring basis are summarized below:

			Fair Value Measurements at June 30, 2017 Using:
			Quoted
			Prices in
			Active		Significant
			Markets for		Other		Significant
			Identical		Observable		Unobservable
	June 30,		Assets		Inputs		Inputs
	2017		(Level 1)		(Level 2)		(Level 3)
	(Dollars in thousands)
Assets:
Available for sale securities
U.S. Treasury and government sponsored entities'    securities	$	134,603	$	—	$	134,603	$	—
States of the U.S. and political subdivisions		58,824		—		58,824
Mortgage-backed GSE securities: residential		93,752		—		93,752		—
Loans held for sale, at fair value		85,954		—		15,959		69,995
Purchased certificate of deposit option		746		—		746		—
Liabilities
Written certificate of deposit option		746		—		746		—

41

			Fair Value Measurements at December 31, 2016 Using:
			Quoted
			Prices in
			Active		Significant
			Markets for		Other		Significant
			Identical		Observable		Unobservable
	December 31,		Assets		Inputs		Inputs
	2016		(Level 1)		(Level 2)		(Level 3)
	(Dollars in thousands)
Assets:
Available for sale securities
U.S. Treasury and government sponsored entities'    securities	$	186,033	$	—	$	186,033	$	—
States of the U.S. and political subdivisions		57,757		—		57,757		—
Mortgage-backed GSE securities: residential		99,494		—		99,494		—
Loans held for sale, at fair value		62,593		—		8,832		53,761
Purchased certificate of deposit option		882		—		882		—
Liabilities
Written certificate of deposit option		882		—		882		—

There were no transfers between Level 1 and Level 2 during 2017 or 2016.

The table below presents a reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three and six months ended June 30, 2017 and 2016.  

	Loans Held for Sale, At Fair Value						Loans Held for Sale, At Fair Value
	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2017			2016			2017			2016
	(Dollars in thousands)
Balance of recurring Level 3 assets at beginning of period	$	67,439		$	26,760		$	53,761		$	26,716
Total gains (losses) for the period
Included in change in fair value of loans held for sale		1,822			622			2,412			1,291
Included in other comprehensive income					—						—
Originations/Draws on construction perm loans		25,945			19,132			51,245			35,819
Amortization					—						—
Sales		(25,211	)		(12,909	)		(37,423	)		(30,221	)
Balance of recurring Level 3 assets at end of period	$	69,995		$	33,605		$	69,995		$	33,605

The following table presents quantitative information about recurring Level 3 fair value measurements at June 30, 2017:

			Valuation	Unobservable
	Fair Value		Technique(s)	Input(s)	Range
Loans held for sale, at fair value	$	69,995	Comparable sales	Time discount	0.00-1.80%

The following table presents quantitative information about recurring Level 3 fair value measurements at December 31, 2016:

			Valuation	Unobservable
	Fair Value		Technique(s)	Input(s)	Range
Loans held for sale, at fair value	$	53,761	Comparable sales	Time discount	0.00-1.80%

The fair value of loans held for sale, at fair value was determined using pricing from a quoted market, discounted for the length of time to the completion of the construction project.

42

Assets and Liabilities Measured on a Non-Recurring Basis: Assets and liabilities measured at fair value on a non-recurring basis are summarized below:

			Fair Value Measurements at June 30, 2017 Using:
			Quoted
			Prices in
			Active		Significant
			Markets for		Other		Significant
			Identical		Observable		Unobservable
	June 30,		Assets		Inputs		Inputs
	2017		(Level 1)		(Level 2)		(Level 3)
	(Dollars in thousands)
Assets:
Impaired loans:
Commercial loans
Multifamily	$	418	$	—	$	—	$	418
Residential loans
One-to four-family residential		756		—		—		756
Consumer loans
Home Equity		28		—		—		28
Auto		17		—		—		17
Marine		169		—		—		169
Recreational vehicle		55		—		—		55
Mortgage servicing rights		82		—		82		—
Other real estate owned, net
Commercial loans
Construction loans		448		—		—		448
Residential loans
One-to four-family residential		35		—		—		35

			Fair Value Measurements at December 31, 2016 Using:
			Quoted
			Prices in
			Active		Significant
			Markets for		Other		Significant
			Identical		Observable		Unobservable
	December 31,		Assets		Inputs		Inputs
	2016		(Level 1)		(Level 2)		(Level 3)
	(Dollars in thousands)
Assets:
Impaired loans:
Commercial loans
Nonresidential	$	2,257	$	—	$	—	$	2,257
Secured		284		—		—		284
Residential loans
One-to four-family residential		919		—		—		919
Consumer loans
Home Equity		228		—		—		228
Auto		177		—		—		177
Recreational vehicle		89		—		—		89
Other real estate owned, net
Commercial loans
Construction loans		748		—		—		748
Residential loans
One-to four-family residential		281		—		—		281

43

Impaired loans with specific allocations of the allowance for loan losses, carried at fair value, which are measured for impairment using the fair value of the collateral for collateral dependent loans, had a net carrying amount of $1.4 million at June 30, 2017, that includes a specific valuation allowance of $5,000. This resulted in an increase of the provision for loan losses of $252,000 and $479,000 during the three and six months ended June 30, 2017, respectively. Impaired loans with specific allocations of the allowance for loan losses, carried at fair value, which are measured for impairment using the fair value of the collateral for collateral dependent loans, had a net carrying amount of $8.2 million at June 30, 2016, which includes a specific valuation allowance of $1.0 million. This resulted in an increase in the provision for loan losses of $592,000 and $3.6 million for the three and six months ended June 30, 2016.  Impaired loans with specific allocations of the allowance for loan losses, carried at fair value, which are measured for impairment using the fair value of the collateral for collateral dependent loans, had a net carrying amount of $4.0 million at December 31, 2016, that includes a specific valuation allowance of $1.3 million.

The significant unobservable (Level 3) inputs used in the fair value measurement of collateral for collateral dependent impaired loans included in the above table primarily relate to the adjustment between carrying values versus appraised value. During the reported periods, discounts applied to appraisals for estimated selling costs were 10%.

At June 30, 2017, mortgage servicing rights carried at fair value were $87,000, with a net valuation allowance of $5,000.  At June 30, 2016, mortgage servicing rights, carried at fair value totaled $2.8 million, resulting in a net valuation allowance of $766,000.  Mortgage servicing rights are valued by an independent third party that is active in purchasing and selling these instruments.  Net impairment reflected in other income totaled $2,000 and $5,000 for the three and six months ended June 30, 2017.  Net impairment reflected in other income totaled $292,000 and $727,000 for the three and six months ended June 30, 2016.  The value reflects the characteristics of the underlying loans.  

At June 30, 2017, other real estate owned, carried at fair value, which is measured for impairment using the fair value of the property less estimated selling costs, and had a net carrying amount of $483,000, with a valuation allowance of $389,000. This resulted in a recovery of expense of $0 and $(38,000) during the three and six months ended June 30, 2017.  At June 30, 2016, other real estate owned, carried at fair value, which is measured for impairment using the fair value of the property less estimated selling costs, and had a net carrying amount of $1.0 million with a valuation allowance of $1.0 million. This resulted in a recovery of $(27,000) and $(26,000) during the three and six months ended June 30, 2016. At December 31, 2016, other real estate owned had a net carrying amount of $1.0 million, with a valuation allowance of $1.0  million.

The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a nonrecurring basis at June 30, 2017:

	Fair Value		Valuation Technique(s)	Unobservable Input(s)	Range     (Weighted Average)
Impaired loans:
Commercial loans
Multi Family	$	418	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-35.00%  (15.00%)
Residential loans
One-to four-family residential		756	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-10.77%  (4.27%)
Consumer loans
Home Equity		28	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-17.85%  (8.93%)
Marine		169	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-37.00%  (37.00%)
Other real estate owned, net
Commercial loans
Construction loans		448	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-80.00%(24.03%)
Residential loans
One-to four-family residential		35	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-3.77%  (3.77%)

44

The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a nonrecurring basis at December 31, 2016:

	Fair Value		Valuation Technique(s)	Unobservable Input(s)	Range     (Weighted Average)
Impaired loans:
Commercial loans
Nonresidential	$	2,257	Sales comparison approach	Adjustment for differences between comparable sales	0.00-35.00%  (15.00%)
Secured		284	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-64.00%  (16.00%)
Residential loans
One-to four-family residential		919	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-10.77%  (4.27%)
Consumer loans
Home Equity		228	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-17.85%  (8.93%)
Other real estate owned:
Commercial loans
Construction loans		748	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-90.40%  (27.46%)
			Cost approach	Adjustment for differences in cost	0.00%-33.33%  (16.67%)
Residential loans
One-to four-family residential		281	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-27.00%  (7.74%)

Auto and recreational vehicle loans were excluded from the table above as their value is considered immaterial.

The Company has elected the fair value option for newly originated residential mortgage and permanent construction loans held for sale.  These loans are intended for sale and the Company believes that fair value is the best indicator of the resolution of these loans.  Interest income is recorded based on the contractual terms of the loan and in accordance with the Company’s policy on loans held for investment.  None of these loans are 90 or more days past due nor on nonaccrual status as of June 30, 2017 and December 31, 2016.  

	June 30, 2017		December 31, 2016
	(Dollars in thousands)
Aggregate fair value	$	85,954	$	62,593
Contractual balance		83,304		62,843
Gain (loss)		2,650		(250	)

The total amount of gains and losses from changes in fair value included in earnings for the three and six months ended June 30, 2017 and 2016 for loans held for sale, at fair value were:

	For the Three Months Ended				For the Six Months Ended
	June 30, 2017		June 30, 2016		June 30, 2017		June 30, 2016
	(Dollars in thousands)
Interest  income	$	—	$	—	$	—	$	—
Interest expense		—		—		—		—
Change in fair value		2,149		845		2,900		1,649
Total change in fair value	$	2,149	$	845	$	2,900	$	1,649

45

In accordance with U.S. GAAP, the carrying value and estimated fair values of financial instruments at June 30, 2017 and December 31, 2016, were as follows:

				Fair Value Measurements at June 30, 2017 Using:
	June 30,
	2017
	Carrying Value			(Level 1)			(Level 2)			(Level 3)
	(Dollars in thousands)
Assets:
Cash and cash equivalents	$	52,014		$	52,014		$	—		$	—
Available for sale securities		287,179			—			287,179			—
Held to maturity securities		88,559			—			87,775			—
Loans held for sale		199			—			205			—
Loans held for sale, at fair value		85,954			—			15,959			69,995
Loans, net		1,869,095			—			—			1,864,169
FHLB stock		19,324		n/a			n/a			n/a
Accrued interest receivable		7,420			—			2,225			5,195
Purchased certificate of deposit option		746			—			746			—
Liabilities:
Deposits:
Checking, savings and money market accounts		(1,252,227	)		(1,252,227	)		—			—
Certificates of deposit		(641,766	)		—			(642,416	)		—
FHLB advances		(328,146	)		—			(328,151	)		—
Repurchase agreements and other		(8,045	)		—			(7,837	)		—
Advance payments by borrowers for taxes and insurance		(21,989	)		(21,989	)		—			—
Accrued interest payable		(392	)		—			(392	)		—
Written certificate of deposit option		(746	)		—			(746	)		—

				Fair Value Measurements at December 31, 2016 Using:
	December 31,
	2016
	Carrying Value			(Level 1)			(Level 2)			(Level 3)
	(Dollars in thousands)
Assets:
Cash and cash equivalents	$	45,887		$	45,887		$	—		$	—
Available for sale securities		343,284			—			343,284			—
Held to maturity securities		97,519			—			92,940			3,210
Loans held for sale at lower of cost or market		165			—			169			—
Loans held for sale, at fair value		62,593			—			8,832			53,761
Loans, net		1,503,577			—			—			1,494,534
FHLB stock		18,068		n/a			n/a			n/a
Accrued interest receivable		6,900			—			2,624			4,276
Purchased certificate of deposit option		882			—			882			—
Liabilities:
Deposits:
Checking, savings and money market accounts		(1,026,565	)		(1,026,565	)		—			—
Certificates of deposit		(488,426	)		—			(491,278	)		—
FHLB advances		(390,756	)		—			(390,750	)		—
Repurchase agreements and other		(512	)		—			(513	)		—
Advance payments by borrowers for taxes and insurance		(23,812	)		(23,812	)		—			—
Accrued interest payable		(145	)		—			(145	)		—
Written certificate of deposit option		(882	)		—			(882	)		—

46

The methods and assumptions, not previously presented, used to estimate fair values are described as follows:

(a) Cash and Cash Equivalents

The carrying amounts of cash and short-term instruments approximate fair values and are classified as Level 1.

(b) FHLB Stock

It is not practical to determine the fair value of FHLB stock due to restrictions placed on its transferability.

(c) Held to maturity securities

Fair values for held to maturity securities are based on quoted market prices, where available. If quoted market prices are not available, fair values are based on quoted market prices of comparable instruments. For securities where quoted prices or market prices of similar securities are not available, fair values are calculated using discounted cash flows.

(d) Loans

Fair values of loans, excluding loans held for sale, are estimated as follows: for variable rate loans that reprice frequently and with no significant change in credit risk, fair values are based on carrying values resulting in a Level 3 classification; fair values for other loans are estimated using discounted cash flow analyses, using interest rates currently being offered for loans with similar terms to borrowers of similar credit quality resulting in a Level 3 classification; and impaired loans are valued at the lower of cost or fair value as described previously. The methods utilized to estimate the fair value of loans do not necessarily represent an exit price.

(e) Deposits

The fair values disclosed for demand deposits (e.g., interest and non-interest checking, savings, and certain types of money market accounts) are, by definition, equal to the amount payable on demand at the reporting date (i.e., their carrying amount) resulting in a Level 1 classification. The carrying amounts of variable rate, fixed-term money market accounts approximate their fair values at the reporting date resulting in a Level 1 classification. Fair values for fixed and variable rate certificates of deposit are estimated using a discounted cash flow calculation that applies interest rates currently being offered on certificates of deposit to a schedule of aggregated expected monthly maturities on time deposits resulting in a Level 2 classification.

(f) Other Borrowings

Short-term borrowings, generally maturing within 90 days, approximate their fair values resulting in a Level 2 classification. The fair values of Home Savings long-term borrowings are estimated using discounted cash flow analyses based on the current borrowing rates for similar types of borrowing arrangements resulting in a Level 2 classification.

(g) Accrued Interest Receivable/Payable

The carrying amounts of accrued interest approximate fair value resulting in a Level 2 or Level 3 classification, depending on the classification of the underlying asset or liability.

(h) Off-balance Sheet Instruments

Fair values for off-balance sheet, credit-related financial instruments are based on fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the counterparties’ credit standing. The fair value of commitments is not material.

47

10. STATEMENT OF CASH FLOWS SUPPLEMENTAL DISCLOSURE

Supplemental disclosures of cash flow information are summarized below.

	For the Six Months Ended June 30,
	2017		2016
	(Dollars in thousands)
Supplemental disclosures of cash flow information
Cash paid  during the period for:
Interest on deposits and borrowings	$	5,396	$	4,166
Income taxes		250		150
Supplemental schedule of noncash activities:
Transfers from loans to real estate owned and other repossessed assets		282		534
Transfers from loans to loans held for sale		27,921		—
Transfers from premises and equipment to other assets, held for sale		1,720		—
Accretion of securities held to maturity		100		109
Issuance of common stock - James & Sons acquisition		—		1,508
Issuance of common stock - Ohio Legacy Corp. acquisition		25,816		—
Net assets acquired from Ohio Legacy Corp., excluding cash and cash equivalents		36		—

11. EARNINGS PER SHARE

The Company has granted stock compensation awards with nonforfeitable dividend rights which are considered participating securities. As such, earnings per share is computed using the two-class method as required by ASC 206-10-45. Basic earnings per common share is computed by dividing net income allocated to common shareholders by the weighted average number of common shares outstanding during the period which excludes the participating securities. Diluted earnings per common share includes the dilutive effect of additional potential common shares from stock compensation awards, but also excludes awards considered participating securities. No stock options were anti-dilutive for the three and six months ended June 30, 2017.  No stock options were anti-dilutive for the three months ended June 30, 2016 and stock options for 71,391 shares were anti-dilutive for the six months ended June 30, 2016.  

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2017			2016			2017			2016
	(Dollars in thousands, except per share data)
Net income per consolidated statements of income	$	8,189		$	5,330		$	9,727		$	8,650
Net income allocated to participating securities		(49	)		(40	)		(61	)		(55	)
Net income allocated to common stock	$	8,140		$	5,290		$	9,666		$	8,595
Basic earnings per common share computation:
Distributed earnings allocated to common stock	$	1,483		$	1,180		$	2,962		$	2,368
Undistributed earnings allocated to common stock		6,657			4,110			6,704			6,227
Net income allocated to common stock	$	8,140		$	5,290		$	9,666		$	8,595
Weighted average common shares outstanding, including shares    considered participating securities		49,691			47,223			49,158			47,405
Less: Average participating securities		(299	)		(354	)		(309	)		(299	)
Weighted average shares		49,392			46,869			48,849			47,106
Basic earnings per common share	$	0.16		$	0.11		$	0.20		$	0.18
Diluted earnings per common share computation:
Net income allocated to common stock	$	8,140		$	5,290		$	9,666		$	8,595
Weighted average common shares outstanding for basic    earnings per common share		49,392			46,869			48,849			47,106
Add: Dilutive effects of assumed exercises of stock options and LTIP    awards		403			248			398			247
Weighted average shares and dilutive potential common shares		49,795			47,117			49,247			47,353
Diluted earnings per common share	$	0.16		$	0.11		$	0.20		$	0.18

48

12. OTHER COMPREHENSIVE INCOME (LOSS)

Other comprehensive income (loss) included in the consolidated statements of shareholders’ equity consists of unrealized gains and losses on available for sale securities, disproportional tax effects and changes in unrealized gains and losses on the postretirement liability. The change includes reclassification of net gains or (losses) on sales of securities of $301,000 and $233,000 for the three months ended June 30, 2017 and 2016, respectively and $330,000 and $386,000 for the six months ended June 30, 2017 and 2016, respectively.  Reclassifications also include amortization of unrealized gains on postretirement plan and accretion of unrealized loss on held to maturity securities.    

Other comprehensive income (loss) components and related tax effects for the three-month periods are as follows:

	Unrealized Gains (Losses) on Securities Availablefor Sale			Disproportionate Tax Effect from Securities Available for Sale			Losses on Securities Transferred From Available for Sale to Held to Maturity			Total
June 30, 2017	(Dollars in thousands)
Balances at beginning of period, net of tax	$	(2,165	)	$	(17,110	)	$	(767	)	$	(20,042	)
Other comprehensive income before    reclassifications		1,758			—			—			1,758
Accretion of unrealized losses of securities    transferred from available for sale to    held to maturity recognized in other    comprehensive income		—			—			32			32
Reclassification adjustment for gains realized    in income		(196	)		—			—			(196	)
Net current period other comprehensive income		1,562			—			32			1,594
Balances at end of period, net of tax	$	(603	)	$	(17,110	)	$	(735	)	$	(18,448	)

	Unrealized Gains (Losses) on Securities Available for Sale			Disproportionate Tax Effect from Securities Available for Sale			Losses on Securities Transferred From Available for Sale to Held to Maturity			Unrealized Gains (Losses) from Postretirement Plan			Disproportionate Tax Effect from Postretirement Plan		Total
June 30, 2016	(Dollars in thousands)
Balances at beginning of period,    net of tax	$	3,937		$	(17,110	)	$	(926	)	$	650		$	511	$	(12,938	)
Other comprehensive income    before reclassifications		4,594			—			—			—			—		4,594
Amortization of unrealized gains    of postretirement plan    recognized in other    comprehensive income		—			—			—			(181	)		—		(181	)
Accretion of unrealized losses of    securities transferred from    available for sale to held    to maturity recognized in    other comprehensive income		—			—			37			—			—		37
Reclassification adjustment for    gains realized in income		(152	)		—			—			—			—		(152	)
Net current period other    comprehensive income		4,442			—			37			(181	)		—		4,298
Balances at end of period, net of    tax	$	8,379		$	(17,110	)	$	(889	)	$	469		$	511	$	(8,640	)

49

Other comprehensive income (loss) components and related tax effects for the six-month periods are as follows:

	Unrealized Gains (Losses) on Securities Availablefor Sale			Disproportionate Tax Effect from Securities Available for Sale			Losses on Securities Transferred From Available for Sale to Held to Maturity			Total
June 30, 2017	(Dollars in thousands)
Balances at beginning of period, net of tax	$	(3,130	)	$	(17,110	)	$	(800	)	$	(21,040	)
Other comprehensive income before    reclassifications		2,742			—			—			2,742
Accretion of unrealized losses of securities    transferred from available for sale to held    to maturity recognized in other    comprehensive income		—			—			65			65
Reclassification adjustment for gains realized    in income		(215	)		—			—			(215	)
Net current period other comprehensive    income		2,527			—			65			2,592
Balances at end of period, net of tax	$	(603	)	$	(17,110	)	$	(735	)	$	(18,448	)

	Unrealized Gains (Losses) on Securities Available for Sale			Disproportionate Tax Effect from Securities Available for Sale			Losses on Securities Transferred From Available for Sale to Held to Maturity			Unrealized Gains (Losses) from Postretirement Plan			Disproportionate Tax Effect from Postretirement Plan		Total
June 30, 2016	(Dollars in thousands)
Balances at beginning of period,    net of tax	$	(2,492	)	$	(17,110	)	$	(960	)	$	831		$	511	$	(19,220	)
Other comprehensive income    before reclassifications		11,122			—						—			—		11,122
Amortization of unrealized    gains of postretirement plan    recognized in other    comprehensive income		—			—			—			(362	)		—		(362	)
Accretion of unrealized losses    of securities transferred    from available for sale to    held to maturity recognized    in other comprehensive    income		—			—			71			—			—		71
Reclassification adjustment    for gains realized in income		(251	)		—			—			—			—		(251	)
Net current period other    comprehensive income		10,871			—			71			(362	)		—		10,580
Balances at end of period, net of    tax	$	8,379		$	(17,110	)	$	(889	)	$	469		$	511	$	(8,640	)

50

As of June 30, 2014, management concluded it was more likely than not that the Company’s net deferred tax asset (DTA) would be realized and accordingly determined a full deferred tax valuation allowance was no longer required. Upon reversal of the former full deferred tax valuation allowance as of June 30, 2014, certain disproportionate tax effects are retained in accumulated other comprehensive income (loss) totaling approximately a ($16.6) million loss. Almost the entire disproportionate tax effect is attributable to valuation allowance expense recorded through other comprehensive income (loss) on the tax benefit of losses sustained on the available for sale securities portfolio while the Company was in a full deferred tax valuation allowance. This valuation allowance was appropriately reversed through continuing operations at June 30, 2014, leaving the original expense in accumulated other comprehensive income (loss), where it will remain in accordance with the Company’s election of the “portfolio approach”, until such time as the Company would cease to have an available for sale security portfolio.

The following are significant amounts reclassified out of each component of accumulated comprehensive income (loss) for the three months ended June 30, 2017:

	Amount Reclassified			Affected Line Item on
	From Accumulated			the Statement Where
Details About Accumulated Other Comprehensive	Other Comprehensive			Net Income is
Income Components	Income			Presented
	(Dollars in thousands)
Realized net gains on the sale of available for sale securities	$	(301	)	Net gains on securitiesavailable for sale
		105		Tax expense
Total reclassification during the period	$	(196	)	Net of tax, increase to net income

The following are significant amounts reclassified out of each component of accumulated comprehensive income (loss) for the three months ended June 30, 2016:

	Amount Reclassified			Affected Line Item on
	From Accumulated			the Statement Where
Details About Accumulated Other Comprehensive	Other Comprehensive			Net Income is
Income Components	Income			Presented
	(Dollars in thousands)
Realized net gains on the sale of available for sale securities	$	(233	)	Net gainson securitiesavailable for sale
		81		Tax expense
		(152	)	Net of tax
Amortization of postretirement benefits prior service costs		(278	)	Reduction in salaries and employee benefits
		97		Tax expense
		(181	)	Net of tax
Total reclassification during the period	$	(333	)	Increase to net income

The following are significant amounts reclassified out of each component of accumulated comprehensive income (loss) for the six months ended June 30, 2017:

	Amount Reclassified			Affected Line Item on
	From Accumulated			the Statement Where
Details About Accumulated Other Comprehensive	Other Comprehensive			Net Income is
Income Components	Income			Presented
	(Dollars in thousands)
Realized net gains on the sale of available for sale securities	$	(330	)	Net gains on securitiesavailable for sale
		115		Tax expense
Total reclassification during the period	$	(215	)	Net of tax, increase to net income

51

The following are significant amounts reclassified out of each component of accumulated comprehensive income (loss) for the six months ended June 30, 2016:

	Amount Reclassified			Affected Line Item on
	From Accumulated			the Statement Where
Details About Accumulated Other Comprehensive	Other Comprehensive			Net Income is
Income Components	Income			Presented
	(Dollars in thousands)
Realized net gains on the sale of available for sale securities	$	(386	)	Net gainson securitiesavailable for sale
		135		Tax expense
		(251	)	Net of tax
Amortization of postretirement benefits prior service costs		(556	)	Reduction in salaries and employee benefits
		194		Tax expense
		(362	)	Net of tax
Total reclassification during the period	$	(613	)	Increase to net income

13. REGULATORY CAPITAL REQUIREMENTS

Home Savings and United Community are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possible additional discretionary actions by regulators that, if undertaken, could have a direct material effect on Home Savings and United Community. The regulations require Home Savings to meet specific capital adequacy guidelines in keeping with the regulatory framework for prompt corrective action that involve quantitative measures of Home Savings’ assets, liabilities, and certain off balance sheet items as calculated under regulatory accounting practices. Home Savings’ capital classification is also subject to qualitative judgments by the regulators about components of capital, risk weightings, and other factors.

The Basel III Capital Rules establish a common equity Tier 1 minimum capital requirement (4.5% of risk-weighted assets), a minimum Tier 1 capital to risk-based assets requirement (6% of risk-weighted assets) and assigns a risk weight (150%) to exposures that are more than 90 days past due or are on nonaccrual status and to certain commercial real estate facilities that finance the acquisition, development or construction of real property. The rules also require unrealized gains and losses on certain available-for-sale securities holdings to be included for purposes of calculating regulatory capital requirements unless a one-time opt-in or opt-out is exercised. In connection with the adoption of the Basel III Capital Rules, United Community and Home Savings elected to opt-out of the requirement to include most components of accumulated other comprehensive income in Common Equity Tier 1.  The rule limits a banking organization’s capital distributions and certain discretionary bonus payments if the banking organization does not hold a “capital conservation buffer” consisting of 2.5% of common equity Tier 1 capital risk-based weighted assets in addition to the amount necessary to meeting its minimum risk-based capital requirements.

The capital conservation buffer requirement will be phased in through January 1, 2019, when the full capital conservation buffer requirement will be effective. The capital conservation buffer for 2017 is 1.25%.  The final rule also implemented consolidated capital requirements.

Quantitative measures established by regulation for capital adequacy require Home Savings to maintain minimum ratios of Tier 1 (or Core) capital (as defined in the regulations) to average total assets (as defined) and of total risk-based capital (as defined) to risk-weighted assets (as defined).  United Community and Home Savings’ Common Equity Tier 1 capital consists of common stock and related paid-in capital, net of treasury stock, and retained earnings. Common Equity Tier 1 for both United Community and Home Savings is reduced by intangible assets, net of associated deferred tax liabilities and subject to transition provisions. Actual and regulatory required capital ratios for Home Savings, along with the dollar amount of capital implied by such ratios, are presented below.

	June 30, 2017
											To Be Well Capitalized
						Minimum Capital					Under Prompt
						Requirements For Capital					Corrective Action
	Actual					Adequacy Purposes***					Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
	(Dollars in thousands)
Total capital (to risk-weighted assets)	$	277,583		14.83	%	$	173,129		9.25	%	$	187,166		10.00	%
Tier 1 capital (to risk-weighted assets)		257,947		13.78	%		135,695		7.25	%		149,733		8.00	%
Common equity Tier 1 capital (to risk-weighted    assets)		257,947		13.78	%		107,621		5.75	%		121,658		6.50	%
Tier 1 capital (to average assets)**		257,947		10.14	%		101,794		4.00	%		127,242		5.00	%

52

	December 31, 2016
											To Be Well Capitalized
						Minimum Capital					Under Prompt
						Requirements					Corrective Action
	Actual					Per Regulation***					Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
	(Dollars in thousands)
Total capital (to risk-weighted assets)	$	248,861		16.47	%	$	130,292		8.625	%	$	151,063		10.00	%
Tier 1 capital (to risk-weighted assets)		229,938		15.22	%		100,079		6.625	%		120,850		8.00	%
Common equity Tier 1 capital (to risk-weighted    assets)		229,938		15.22	%		77,420		5.125	%		98,191		6.50	%
Tier 1 capital (to average assets)**		229,938		10.65	%		86,360		4.000	%		107,950		5.00	%

** Tier 1 Leverage Capital Ratio

*** The capital ratios are reflective of the capital conservation buffer

Management believes that as of June 30, 2017 and December 31, 2016, Home Savings met all capital adequacy requirements to which it was subject.  As of June 30, 2017 and December 31, 2016, Home Savings met the capital requirements to be deemed well capitalized. There are no known conditions that would change this classification subsequent to June 30, 2017.  

The components of Home Savings’ regulatory capital are as follows:

	June 30, 2017			December 31, 2016
Total shareholders' equity	$	264,512		$	216,475
Add (deduct)
Accumulated other comprehensive income		18,463			21,056
Intangible assets		(20,313	)		(3	)
Disallowed deferred tax assets		(4,715	)		(7,590	)
Disallowed capitalized mortgage loan servicing rights		—			—
Tier 1 Capital		257,947			229,938
Allowance for loan losses and allowance for unfunded lending commitments    limited to 1.25% of total risk-weighted assets		19,636			18,923
Total risk-based capital	$	277,583		$	248,861

53

Actual and regulatory required consolidated capital ratios for United Community, along with the dollar amount of capital implied by such ratios, are presented below.

	June 30, 2017
						Minimum Capital
						Requirements
	Actual					Per Regulation***
	Amount		Ratio			Amount		Ratio
	(Dollars in thousands)
Total capital (to risk-weighted assets)	$	293,814		15.66	%	$	173,548		9.25	%
Tier 1 capital (to risk-weighted assets)		274,154		14.61	%		136,024		7.25	%
Common equity Tier 1 capital (to risk-weighted assets)		274,154		14.61	%		107,881		5.75	%
Tier 1 capital (to average assets)**		274,154		10.76	%		101,870		4.00	%
	December 31, 2016
						Minimum Capital
						Requirements
	Actual					Per Regulation***
	Amount		Ratio			Amount		Ratio
	(Dollars in thousands)
Total capital (to risk-weighted assets)	$	277,817		18.38	%	$	130,369		8.625	%
Tier 1 capital (to risk-weighted assets)		258,869		17.13	%		100,139		6.625	%
Common equity Tier 1 capital (to risk-weighted assets)		258,869		17.13	%		77,466		5.125	%
Tier 1 capital (to average assets)**		258,869		11.98	%		86,425		4.000	%

As of June 30, 2017 and December 31, 2016, United Community’s capital exceeded the requirements to be deemed well capitalized.

The components of United Community’s consolidated regulatory capital are as follows:

	June 30, 2017			December 31, 2016
Total shareholders' equity	$	285,480		$	249,806
Add (deduct)
Accumulated other comprehensive income		18,463			21,040
Intangible assets		(21,352	)		(1,567	)
Disallowed deferred tax assets		(8,437	)		(10,410	)
Disallowed capitalized mortgage loan servicing rights		—			—
Tier 1 Capital		274,154			258,869
Allowance for loan losses and allowance for unfunded lending commitments    limited to 1.25% of total risk-weighted assets		19,660			18,948
Total risk-based capital	$	293,814		$	277,817

54

14. INCOME TAXES

Significant components of the deferred tax assets and liabilities are as follows:

	June 30,		December 31,
	2017		2016
	(Dollars in thousands)
Deferred tax assets:
Loan loss reserves	$	6,881	$	6,680
Depreciation		886		748
Other real estate owned valuation		136		354
Tax credits carryforward		1,845		1,471
Unrealized loss on securities available for sale		324		1,685
Unrealized loss on securities held to maturity		396		431
Interest on nonaccrual loans		952		1,039
Net operating loss carryforward		6,593		8,574
Purchase accounting adjustment		1,000		—
Accrued bonuses		756		812
Other		79		221
Deferred tax assets		19,848		22,015
Deferred tax liabilities:
Deferred loan fees		1,622		1,275
Federal Home Loan Bank stock dividends		4,645		4,585
Mortgage servicing rights		2,155		2,124
FHLB prepayment penalty		649		786
Purchase accounting adjustment		—		371
Prepaid expenses		671		139
Deferred tax liabilities		9,742		9,280
Net deferred tax asset	$	10,106	$	12,735

As of June 30, 2017, the net deferred tax asset was $10.1 million, and as of December 31, 2016, the net deferred tax asset was $12.7 million.

The Company’s ultimate realization of the net deferred tax asset is dependent upon the generation of future taxable income during the periods in which temporary differences become deductible. Management considers the nature and amount of historical and projected future taxable income, the scheduled reversal of deferred tax assets and liabilities, and available tax planning strategies in making this assessment. The amount of deferred taxes recognized could be impacted by changes to any of these variables.

United Community’s net operating loss of $18.8 million at June 30, 2017 will be carried forward to use against future taxable income. The net operating loss carryforwards begin to expire in the year ending December 31, 2030. In addition, United Community is carrying forward $1.8 million of alternative minimum tax credits. The alternative minimum tax credits are carried forward indefinitely.

Effective tax rates differr from the statutory federal income tax rate of 35% due to the following:

	For the Three Months Ended June 30,
	2017						2016
	Dollars			Rate			Dollars			Rate
	(Dollars in thousands)
Tax at statutory rate:	$	4,048			35.00	%	$	2,751			35.00	%
Increase (decrease) due to:
Tax exempt income		(166	)		(1.44	)%		(124	)		(1.57	)%
Life insurance		(137	)		(1.18	)%		(128	)		(1.63	)%
Stock compensation		(138	)		(1.19	)%		—			—	%
Other		(230	)		(1.99	)%		30			0.38	%
Income tax provision	$	3,377			29.20	%	$	2,529			32.18	%

55

	For the Six Months Ended June 30,
	2017						2016
	Dollars			Rate			Dollars			Rate
	(Dollars in thousands)
Tax at statutory rate:	$	4,781			35.00	%	$	4,470			35.00	%
Increase (decrease) due to:
Tax exempt income		(337	)		(2.47	)%		(187	)		(1.47	)%
Life insurance		(269	)		(1.97	)%		(256	)		(2.00	)%
Stock compensation		(198	)		(1.45	)%		—			—	%
Other		(43	)		(0.31	)%		94			0.74	%
Income tax provision	$	3,934			28.80	%	$	4,121			32.27	%

15. GOODWILL AND INTANGIBLE ASSETS

Goodwill:

The change in goodwill during the periods presented is as follows:

	June 30, 2017		December 31, 2016
	(In thousands)
Beginning of the year	$	208	$	—
Effect of adjustments-James & Sons Insurance		636		—
Acquired goodwill-OLCB		18,420		—
Effect of adjustments-OLCB		15		—
Acquired goodwill-Eich Brothers Insurance		188		—
Acquired goodwill-James & Sons Insurance		—		208
Impairment	—		—
End of the year	$	19,467	$	208

The changes to goodwill during the six months ended June 30, 2017 are primarily due to changes in the final market value for the customer list intangible asset, as well as the related tax effect from those adjustments related to the James & Sons acquisition in January 2016.  

Impairment exists when a reporting unit’s carrying value of goodwill exceeds its fair value.  If the carrying amount of a reporting unit is zero or less than zero, a qualitative analysis of whether it is more likely than not that the reporting unit goodwill is impaired will be performed.  The qualitative assessment indicated that it was more likely than not that the fair value of the reporting unit exceeded its carrying value, resulting in no impairment.  The Company did not have any reporting units with a carrying amount of zero or less than zero at June 30, 2017 or December 31, 2016.

Acquired Intangible Assets:

	June 30, 2017				December 31, 2016
	Gross				Gross
	Carrying		Accumulated		Carrying		Accumulated
	Amount		Amortization		Amount		Amortization
	(In thousands)
Amortized intangible assets:
Core deposit intangibles	$	11,184	$	9,085	$	8,952	$	8,947
Customer list intangible		2,162		102		1,400		44
Total	$	13,346	$	9,187	$	10,352	$	8,991

56

Core deposit intangible:

	For the six months ended June 30, 2017			For the year ended December 31, 2016
	(In thousands)
Beginning of the year	$	5		$	30
Acquired core deposit intangible-OLCB		2,232			—
Amortization		(138	)		(25	)
End of the period	$	2,099		$	5

Customer list intangible:

	For the six months ended June 30, 2017			For the year ended December 31, 2016
	(In thousands)
Beginning of the year	$	1,356		$	—
Effect of adjustments-James & Sons Insurance		(41	)		—
Acquired customer list intangible-OLCB		268			—
Acquired customer list intangible-Eich Brothers Insurance		535			—
Acquired customer list intangible-James & Sons Insurance		—			1,400
Amortization		(58	)		(44	)
End of the period	$	2,060		$	1,356

Aggregate amortization expense for the three months ended June 30, 2017 and 2016 was $113,000 and $10,000, respectively.  Aggregate amortization expense for the six months ended June 30, 2017 and 2016 was $196,000 and $23,000, respectively.  Estimated amortization expense for the remainder of 2017 and the next five years is as follows:

Remainder of 2017	$	224,000
2018		448,000
2019		448,000
2020		448,000
2021		448,000
2022		448,000

16. QUALIFIED AFFORDABLE HOUSING PROJECT INVESTMENTS

The Company invests in qualified affordable housing projects.  At June 30, 2017 and December 31, 2016, the balance of the investment for qualified affordable housing projects was $6.0 million and $3.0 million, respectively.  These balances are reflected in other assets on the consolidated balance sheet.  Total unfunded commitments related to the investments in qualified affordable housing projects totaled $5.9 million and $2.9 million at June 30, 2017 and December 31, 2016, respectively.  The Company expects to fulfill these commitments over the next eight to ten years.

During the three months ended June 30, 2017 and 2016, the Company recognized amortization expense of $36,000 and $0, respectively which was included within income tax expense on the consolidated statements of income. During the six months ended June 30, 2017 and 2016, the Company recognized amortization expense of $90,000 and $0, respectively.

Additionally, during the three months ended June 30, 2017 and 2016, the Company recognized tax credits and other benefits from its investment in affordable housing tax credits of $44,000 and $0, respectively.  During the six months ended June 30, 2017 and 2016, the Company recognized tax credits and other benefits from its investment in affordable housing tax credits of $110,000 and $0, respectively.  During the three and six months ended June 30, 2017 and 2016, the Company incurred no impairment losses.

57

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS

OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

UNITED COMMUNITY FINANCIAL CORP.

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
Selected financial ratios and other data: (1)	2017			2016			2017			2016
Performance ratios:
Return on average assets (2)		1.27	%		1.04	%		0.78	%		0.86	%
Return on average equity (3)		11.60	%		8.63	%		6.99	%		6.98	%
Interest rate spread (4)		3.34	%		3.14	%		3.26	%		3.11	%
Net interest margin (5)		3.46	%		3.25	%		3.38	%		3.23	%
Noninterest expense to average assets		2.36	%		2.52	%		2.83	%		2.50	%
Efficiency ratio (6)		54.71	%		60.81	%		68.29	%		62.34	%
Average interest-earning assets to average interest-bearing liabilities		124.72	%		125.25	%		124.62	%		125.00	%
Capital ratios:
Average equity to average assets		10.97	%		12.09	%		11.09	%		12.25	%
Equity to assets, end of period		11.18	%		12.21	%		11.18	%		12.21	%
Tier 1 leverage ratio (Bank only)		10.14	%		11.69	%		10.14	%		11.69	%
Common equity Tier 1 capital (Bank only)		13.78	%		17.31	%		13.78	%		17.31	%
Tier 1 risk-based capital ratio (Bank only)		13.78	%		17.31	%		13.78	%		17.31	%
Total risk-based capital ratio (Bank only)		14.83	%		18.56	%		14.83	%		18.56	%
Asset quality ratios:
Nonperforming loans to net loans at end of period (7)		0.58	%		1.45	%		0.58	%		1.45	%
Nonperforming assets to average assets (8)		0.71	%		1.07	%		0.73	%		1.09	%
Nonperforming assets to total assets at end of period		0.72	%		1.06	%		0.72	%		1.06	%
Allowance for loan losses as a percent of loans		1.04	%		1.21	%		1.04	%		1.21	%
Allowance for loan losses as a percent of nonperforming loans (7)		182.32	%		84.42	%		182.32	%		84.42	%
Total classified assets as a percent of Tier 1 Capital (Bank only)		16.92	%		17.38	%		16.92	%		17.38	%
Total classified loans as a percent of Tier 1 Capital and ALLL (Bank    only)		12.99	%		15.57	%		12.99	%		15.57	%
Total classified assets as a percent of Tier 1 Capital and ALLL (Bank    only)		15.72	%		16.21	%		15.72	%		16.21	%
Net chargeoffs as a percent of average loans		0.03	%		0.04	%		0.20	%		0.46	%
Total 90+ days past due as a percent of net loans		0.41	%		1.13	%		0.41	%		1.13	%
Per share data:
Basic earnings per common share (9)	$	0.16		$	0.11		$	0.20		$	0.18
Diluted earnings per common share (9)		0.16			0.11			0.20			0.18
Book value per common share (10)		5.74			5.46			5.74			5.46
Tangible book value per common share (11)		5.27			5.43			5.27			5.43
Cash dividend per common share		0.030			0.025			0.060			0.050
Dividend payout ratio (12)		18.77	%		22.32	%		30.57	%		27.47	%

Notes:

1. Ratios for the three and six month periods are annualized where appropriate

2. Net income divided by average total assets

3. Net income divided by average total equity

4. Difference between weighted average yield on interest-earning assets and weighted average cost of interest-bearing liabilities

5. Net interest income as a percent of average interest-earning assets

6. Noninterest expense, excluding the amortization of the core deposit intangible and prepayment penalty, divided by the sum of net interest income and noninterest income, excluding gains and losses on securities and gains and losses on foreclosed assets

7. Nonperforming loans consist of nonaccrual loans and loans past due ninety days and still accruing

8. Nonperforming assets consist of nonperforming loans, real estate owned and other repossessed assets and other assets

9. Net income divided by the number of basic or diluted shares outstanding

10. Shareholders’ equity divided by number of shares outstanding

11. Shareholders’ equity minus goodwill and core deposit intangible divided by number of shares outstanding

12. Historical per share dividends declared and paid for the period divided by the diluted earnings per share for that year

58

Forward-Looking Statements

When used in this Form 10-Q, the words or phrases “will likely result,” “are expected to,” “plan to,” “will continue,” “is anticipated,” “estimate,” “project” or similar expressions are intended to identify “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties, including changes in economic conditions in United Community’s market area, changes in policies by regulatory agencies, fluctuations in interest rates, demand for loans in Home Savings’ market area and competition that could cause actual results to differ materially from results presently anticipated or projected. United Community cautions readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. United Community advises readers that the factors listed above could affect United Community’s financial performance and could cause United Community’s actual results for future periods to differ materially from any opinions or statements expressed with respect to future periods in any current statements. United Community undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made.

Material Changes in Financial Condition at June 30, 2017 and December 31, 2016

On January 31, 2017, United Community completed its acquisition of OLCB.  Pursuant to the terms of the Merger Agreement, OLCB was merged with and into United Community (the merger). Immediately following the merger, Home Savings was merged with and into Premier Bank & Trust, a subsidiary of OLCB, and changed its name to Home Savings Bank.

As a result of the merger and in accordance with the terms of the Merger Agreement, each preferred share of OLCB was deemed to have been converted into OLCB common shares. Each OLCB common share was converted into the right to receive either $18.00 in cash or 2.736 United Community common shares, subject to certain allocation procedures set forth in the Merger Agreement that ensured that 50% of OLCB’s common shares outstanding were converted into United Community common shares, and 50% of OLCB’s common shares outstanding were converted into the right to receive the cash consideration. The Company paid cash in lieu of issuing fractional shares.  This transaction resulted in the addition of approximately $349.0 million in assets and the addition of 4 branches in Summit, Stark and Belmont counties.

HSB Insurance, Inc., a wholly-owned subsidiary of the Company which was formed and began operations on June 1, 2017, is a Delaware-based captive insurance company which insures against certain risks unique to the operations of the Corporation and its subsidiaries and for which insurance may not be currently available or economically feasible in today's insurance marketplace. HSB Insurance, Inc. pools resources with several other similar insurance company subsidiaries of financial institutions to spread a limited amount of risk among themselves.  HSB Insurance, Inc. is subject to regulations of the State of Delaware and undergoes periodic examinations by the Delaware Division of Insurance.

Cash and cash equivalents increased $6.1 million during the first six months of 2017.  The addition of OLCB added cash and cash equivalents of $46.2 million to the combined company.  This cash was used to pay for the cash portion of the merger and to support lending activities of the combined companies.  Cash levels are expected to remain stable during the remainder of 2017.  

Available for sale securities decreased $56.1 million during the first six months of 2017.  The acquisition of OLCB added $10.0 million dollars in securities to the available for sale portfolio, but the securities matured prior to the end of the first quarter.  The decrease in the available for sale securities balance since December 31, 2016 was the result of paydowns and the amortization of premiums/discounts on the securities along with sales totaling $53.2 million.  The sales were completed to provide additional liquidity for lending activity.  The shrinkage of the securities portfolio to fund loan growth has been part of the Company’s strategic plan.  Partially offsetting this activity was a decrease in the unrealized loss on securities. The unrealized loss in the available for sale portfolio was $926,000 million at June 30, 2017, compared to an unrealized loss of $4.8 million at December 31, 2016.

Held to maturity securities declined $9.0 million at June 30, 2017 compared to December 31, 2016.  This change was the result of maturities, paydowns and the amortization of premiums/discounts on the securities.

Net loans increased $365.5 million during the first six months of 2017 primarily as a result of the acquisition of OLCB, which added $259.4 million in balances but also due to $150.6 million of organic loan growth. The organic loan growth increase was substantially attributed to the commercial portfolio during the period. Offsetting this growth was a mortgage loan sale of $27.7 million during the second quarter of 2017.  See Note 6 to the consolidated financial statements for additional information regarding the composition of loans.

The allowance for loan losses is a valuation allowance for probable incurred credit losses established through a provision for loan losses charged to expense. The allowance for loan losses was $19.6 million at June 30, 2017, up from the $19.1 million reported at December 31, 2016. The allowance for loan losses as a percentage of loans was 1.04% at June 30, 2017, compared to 1.25% at December 31, 2016.  The decrease is the result of the acquired loan portfolio being recorded at fair value without an allowance for loan losses.    

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The allowance for loan losses as a percentage of nonperforming loans was 182.3% at June 30, 2017, compared to 153.4% at December 31, 2016.  Loan losses are charged against the allowance when the uncollectability of a loan balance is confirmed. Subsequent recoveries, if any, are added back to the allowance. Home Savings’ allowance for loan loss methodology includes allowance allocations calculated in accordance with ASC Topic 310, “Receivables,” and allowance allocations calculated in accordance with ASC Topic 450, “Contingencies”. As of June 30, 2017, the Company evaluated 20 quarters of net charge-off history and applied this information to the current period.  This component is combined with the qualitative component to arrive at the loss factor, which is applied to the outstanding balance of homogenous loans.

A loan is considered impaired when there is a deterioration of the credit worthiness of the borrower to the extent that the collection of the full amount of principal and interest is no longer probable. The total outstanding balance of all impaired loans was $26.2 million at June 30, 2017 as compared to $31.5 million at December 31, 2016.

Included in impaired loans above are certain loans Home Savings considers to be troubled debt restructurings (TDR). A loan is considered a TDR if Home Savings grants a concession to a debtor experiencing financial difficulty that it would otherwise not consider. The concession either stems from an agreement between the creditor and the debtor or is imposed by law or a court. If the debtor is not currently experiencing financial difficulties, but would probably be in payment default in the future without the modification, then this type of restructure also could be considered a TDR.

TDR loans aggregated $22.2 million at June 30, 2017 compared to $26.6 million at December 31, 2016.  Of the $22.2 million at June 30, 2017, $19.3 million were performing loans according to their modified terms.  The remaining balance of TDR loans of $2.9 million were considered nonperforming.  

Nonperforming loans consist of nonaccrual loans and loans past due 90 days and still accruing. Nonperforming loans were $10.8 million, or 0.58% of loans, at June 30, 2017, compared to $12.4 million, or 0.83% of loans, at December 31, 2016.

Loans held for sale, carried at lower of cost or market, were $199,000 at June 30, 2017, compared to $165,000 at December 31, 2016.  Loans held for sale, carried at fair value, were $86.0 million at June 30, 2017, compared to $62.6 million at December 31, 2016. OLCB had no loans held for sale at the time of acquisition.  The change was primarily attributable to the origination of permanent construction loans during the period.  These loans are not sold until construction of the residence is complete, which is usually within nine to ten months of origination.  Home Savings continues to sell a majority of its newly originated fixed rate mortgage loans into the secondary market as part of its risk management strategy and anticipates continuing to do so in the future.

Real estate owned and other repossessed assets decreased $580,000 to $1.2 million during the six months ended June 30, 2017.  Real estate owned and other repossessed assets are recorded at the fair market value of the property less costs to sell. Appraisals are obtained at least annually on real estate properties that exceed $1.0 million in value. A valuation allowance may be established on any property to properly reflect the asset at fair value.  

Goodwill and other intangible assets increased $22.1 million during the first six months of 2017, which was primarily due to the acquisition of OLCB.  

Bank Owned Life Insurance (BOLI) is maintained on select officers and employees of Home Savings whereby Home Savings is the beneficiary. BOLI is recorded at its cash surrender value, or the amount currently realizable. Increases in the Home Savings’ policy cash surrender value are tax exempt and death benefit proceeds received by Home Savings are tax-free. Income from these policies and changes in the cash surrender value are recorded in other income. There is no post-termination coverage, split dollar or other benefits provided to participants covered by the BOLI. Home Savings recognized $767,000 as other non-interest income based on the change in cash value of the policies in the six months ended June 30, 2017 compared to $730,000 for the six months ended June 30, 2016.

Total deposits increased $379.0 million from $1.5 billion at December 31, 2016, to $1.9 billion at June 30, 2017.  The increase in deposits is primarily the result of the $266.3 in deposits acquired in the OLCB transaction.  In addition, brokered certificates of deposit increased $55.1 million during the first half of 2017 from $76.5 million at December 31, 2016 to $131.6 million at June 30, 2017.  The remaining $57.2 million in balance change was attributable to organic growth.  All deposit types have shown increases as a result of the acquisition.  As of June 30, 2017, the Company had $120.9 million in public funds compared to $106.3 million in public funds at December 31, 2016.  No public funds were acquired in the merger.        

FHLB advances decreased from $390.8 million at December 31, 2016 to $328.1 million at June 30, 2017.  The change was primarily due to an increase in brokered certificates of deposit that were used to pay down FHLB advances.

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Shareholders’ equity increased $35.7 million to $285.5 million at June 30, 2017 from $249.8 million at December 31, 2016.  The increase is primarily due to the $25.8 million of stock that was issued as part of the purchase of OLCB.  In addition, the Company has earned $9.7 million during the first six months of 2017 while paying out $3.0 million in common dividends.  Accumulated other comprehensive income of $2.6 also contributed to the change in shareholders’ equity.

Book value per common share as of June 30, 2017 was $5.74 as compared to $5.36 per common share as of December 31, 2016.  The Company’s tangible book value per share decreased from $5.32 per share at December 31, 2016 to $5.27 at June 30, 2017.  The increase in book value was due to the issuance of shares in the OLCB acquisition while the decrease in tangible book value can be attributed to the creation of goodwill and other intangible assets. Book value per share is calculated as total shareholders’ equity divided by the number of common shares outstanding. Tangible book value per share is calculated as total shareholders’ equity less goodwill and other intangible assets divided by the number of common shares outstanding.

Material Changes in Results of Operations for the Three Months Ended

June 30, 2017 and June 30, 2016

Net Income. United Community recognized net income for the three months ended June 30, 2017, of $8.2 million, or $0.16 per diluted common share compared to net income of $5.3 million for the three months ended June 30, 2016, or $0.11 per diluted share.  The acquisition of OLCB, the continued growth in earning assets and noninterest income along with a strong focus on expense control have all led to the growth in net income.

Net Interest Income. Net interest income was $20.5 million in the second quarter of 2017 up from the $15.3 million recorded in the second quarter of 2016.  The growth of interest earning assets, both organically and from the acquisition of OLCB, drove this increase along with a 29 basis point improvement in the yield on interest earning assets.  Net interest margin was 3.46% for the second quarter of 2017 compared to 3.25% in the second quarter of 2016.  The increase in the yield on interest earning assets was driven by an increase in yield on total securities of 15 basis points along with a 16 basis point increase in the yield on net loans.  The yield on securities improved primarily due to a change in mix toward higher yielding municipal securities.  The improvement in the yield on net loans was primarily due to the accretion of loan discounts recognized in the acquisition of OLCB.

Interest income increased by $6.2 million in the second quarter of 2017 compared to the same period in 2016, to $23.6 million from $17.4 million. The increase is primarily a result of an increase in average net loans and loans held for sale from both the acquisition and organic growth along with accretion of loan discounts discussed above.  Average net loans increased $493.8 million in the second quarter compared to the same period in 2016. Interest income from net loans increased to $20.0 million for the quarter ended June 30, 2017 compared to $14.2 million for the same period in 2016.  Income from loans held for sale increased to $872,000 for the quarter ended June 30, 2017 compared to $363,000 for the quarter ended June 30, 2016.  

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Interest expense increased by $994,000 in the second quarter of 2017 to $3.1 million compared to the same period in 2016. This increase was primarily due to a $393.1 million increase in average interest-bearing liabilities from the acquisition and growth over the previous twelve months along with a 10 basis point increase in the cost of interest-bearing liabilities.  The cost of average interest-bearing deposits increased 1 basis point to 50 basis points for the three months ended June 30, 2017 from 49 basis points at June 30, 2016.  The cost of average borrowed funds, however, increased to 1.26% for the quarter ending June 30, 2017 compared to 0.77% for the quarter ended June 30, 2016.

	For the Three Months Ended June 30,
	2017 vs. 2016
	Increase						Total
	(decrease) due to						increase
	Rate			Volume			(decrease)
	(Dollars in thousands)
Interest earning assets:
Loans	$	540		$	5,286		$	5,826
Loans held for sale		50			459			509
Securities:
Available for sale-taxable		27			(329	)		(302	)
Available for sale-nontaxable		3			176			179
Held to maturity-taxable		15			(85	)		(70	)
Held to maturity-nontaxable		9			(26	)		(17	)
Federal Home Loan Bank stock		34			13			47
Other interest earning assets		22			3			25
Total interest earning assets	$	700		$	5,497		$	6,197
Interest bearing liabilities:
Interest bearing deposits:
Savings accounts	$	(9	)	$	2		$	(7	)
Checking accounts		142			77			219
Customer certificates of deposit		(2,325	)		2,290			(35	)
Brokered certificates of deposit		157			157			314
Federal Home Loan Bank advances:
Long-term advances		58			5			63
Short-term advances		391			47			438
Repurchase agreements and other		—			2			2
Total interest bearing liabilities	$	(1,586	)	$	2,580			994
Change in net interest income							$	5,203

Provision for Loan Losses. A provision for loan losses is charged to income to bring the total allowance for loan losses to a level considered by management to be adequate, based on management’s evaluation of such factors as the delinquency status of loans, current economic conditions, the net realizable value of the underlying collateral, changes in the composition of the loan portfolio and prior loan loss experience. The Company recognized a loan loss provision of $842,000 in the second quarter of 2017, compared to $395,000 in the second quarter of 2016.  Provision expense in the second quarter of 2017 was primarily driven by organic loan growth during the period.  

Noninterest Income. Non-interest income was $7.1 million in the second quarter of 2017 compared to $5.8 million in the second quarter of 2016.  Favorably affecting this change was the recognition of OLCB’s fee income for a full quarter including $420,000 in trust fees recognized during that time frame. The Company also realized better mortgage banking income in the second quarter of 2017 due to a one-time bulk mortgage loan sale of $27.7 million, which generated $527,000 in gain on sale compared to the prior year quarter.

Noninterest Expense. Non-interest expense increased to $15.2 million during the second quarter of 2017 compared to $12.9 million during the second quarter of 2016.  The increase is primarily due to the acquisition of OLCB.  Cost savings associated with reduced salary and employee benefits were not realized for the entire second quarter due to the timing of employee departures.

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Income Taxes. During the three months ended June 30, 2017, the Company recognized tax expense of $3.4 million on pre-tax income of $11.6 million, compared to tax expense of $2.5 million on pre-tax income of $7.8 million for the three months ended June 30, 2016.  The increased pre-tax income discussed in the narratives above was the primary reason for the increased income tax along with a lower effective tax rate compared to the same quarter a year ago.  The lower effective tax rate is due primarily to nontaxable municipal securites income, BOLI income, tax benefits derived from vesting of restricted stock above grant price, stock option exercises and affordable housing tax credits. See Note 14 to the consolidated financial statements for additional information regarding the composition of income taxes.

Material Changes in Results of Operations for the Six Months Ended

June 30, 2017 and June 30, 2016

Net Income. United Community recognized net income for the six months ended June 30, 2017, of $9.7 million, or $0.20 per diluted common share compared to net income of $8.7 million for the six months ended June 30, 2016, or $0.18 per diluted share.  Acquisition expenses, net of tax, of $3.3 million related to acquisition activities in the first quarter of 2017 reduced net income and diluted earnings per common share.  

Net Interest Income. Net interest income was $39.0 million in the first six months of 2017 up from the $30.2 million recorded in the first six months of 2016.  The growth of interest earning assets, both organically and from the acquisition of OLCB, drove this increase along with a 19 basis point improvement in the yield on interest earning assets.  Net interest margin was 3.38% for the first six months of 2017 compared to 3.23% for the first six months of 2016.  The increase in the yield on interest earning assets was driven by an increase in yield on total securities of 12 basis points along with a 7 basis point increase in the yield on net loans.  The yield on securities improved primarily due to a change in mix toward higher yielding municipal securities.  The improvement in the yield on net loans was primarily due to the accretion of loan discounts recognized in the acquisition of OLCB.

Interest income increased by $10.2 million in the first half of 2017 compared to the same period in 2016, to $44.6 million from $34.4 million. The increase is primarily a result of an increase in average net loans and loans held for sale from both the acquisition and organic growth.  Average total loans, net increased $472.4 million during the first six months of 2017 compared to the same period in 2016. Interest income from loans increased to $37.6 million for the first half of 2017 compared to $28.0 million for the same period in 2016.  Income from loans held for sale increased to $1.5 million for the six months ended June 30, 2017 compared to $695,000 for the six months ended June 30, 2016.  

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Interest expense increased by $1.4 million in the first six months of 2017 to $5.6 million compared to the same period in 2016. This increase was primarily due to a $363.4 million increase in average interest-bearing liabilities from the acquisition and growth over the previous twelve months.  The cost of average interest-bearing deposits declined 3 basis points to 48 basis points for the six months ended June 30, 2017 from 51 basis points at June 30, 2016.  Offsetting this was a 35 basis point increase in the cost of average borrowed funds for the six months ended June 30, 2017 compared to the six months ended June 30, 2016.

	For the Six Months Ended June 30,
	2017 vs. 2016
	Increase						Total
	(decrease) due to						increase
	Rate			Volume			(decrease)
	(Dollars in thousands)
Interest earning assets:
Loans	$	441		$	9,143		$	9,584
Loans held for sale		64			774			838
Securities:
Available for sale-taxable		(32	)		(603	)		(635	)
Available for sale-nontaxable		5			605			610
Held to maturity-taxable		(11	)		(171	)		(182	)
Held to maturity-nontaxable		2			(8	)		(6	)
Federal Home Loan Bank stock		57			22			79
Other interest earning assets		57			33			90
Total interest earning assets	$	583		$	9,795		$	10,378
Interest bearing liabilities:
Interest bearing deposits:
Savings accounts	$	(23	)	$	5		$	(18	)
Checking accounts		163			127			290
Customer certificates of deposit		(588	)		321			(267	)
Brokered certificates of deposit		247			248			495
Federal Home Loan Bank advances:
Long-term advances		112			10			122
Short-term advances		614			190			804
Repurchase agreements and other		(1	)		6			5
Total interest bearing liabilities	$	524		$	907			1,431
Change in net interest income							$	8,947

Provision for Loan Losses. The Company recognized a loan loss provision of $2.3 million in the first half of 2017, compared to $2.6 million in the first half of 2016.  Provision expense in the last two years has primarily been driven by organic loan growth.  

Noninterest Income. Non-interest income was $12.5 million in the first half of 2017 compared to $10.4 million in the first half of 2016.  Favorably affecting this change was the recognition of OLCB’s fee income for five months including $702,000 in trust fees recognized during that time frame. The Company also a had minimal negative change in the valuation adjustment of the mortgage serving asset in the first half of 2017, compared with a negative adjustment of $727,000 in the first half of 2016.

Noninterest Expense. Non-interest expense increased to $35.5 million during the first half of 2017 compared to $25.3 million during the first half of 2016.  Excluding the $5.0 million of acquisition related expense, non-interest expense was up $5.2 million during the first half of 2017 compared to the first half of 2016.  The increase is primarily due to the acquisition of OLCB.  Much of the cost savings associated with the acquisition, primarily in salaries and employee benefits, will not be realized until the second half of 2017.  

Income Taxes. During the six months ended June 30, 2017, the Company recognized tax expense of $3.9 million on pre-tax income of $13.7 million, compared to tax expense of $4.1 million on pre-tax income of $12.8 million for the six months ended June 30, 2016.  A lower effective tax rate is the primary reason for the decrease in income tax. The lower effective tax rate is due primarily to nontaxable municipal securites income, BOLI income, tax benefits derived from vesting of restricted stock above grant price, stock option exercises and affordable housing tax credits. See Note 14 to the consolidated financial statements for additional information regarding the composition of income taxes.

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Liquidity

United Community's liquidity, primarily represented by cash and cash equivalents, is a result of its operating, investing and financing activities.

The principal sources of funds for United Community are deposits, loan repayments, maturities of securities, borrowings from financial institutions, repurchase agreements and other funds provided by operations.  Home Savings also has the ability to borrow from the Federal Home Loan Bank.  While scheduled loan repayments and maturing investments are relatively predictable, deposit flows and early loan prepayments are more influenced by interest rates, general economic conditions and competition.  Investments in liquid assets maintained by United Community and Home Savings are based upon management's assessment of (1) the need for funds, (2) expected deposit flows, (3) yields available on short-term liquid assets, and (4) objectives of the asset and liability management program.  At June 30, 2017, approximately $408.1 million of Home Savings’ certificates of deposit were expected to mature within one year.  Based on past experience and Home Savings’ prevailing pricing strategies, management believes that a substantial percentage of such certificates will be renewed with Home Savings at maturity, although there can be no assurance that this will occur.

Home Savings’ Asset/Liability Committee (ALCO) is responsible for establishing and monitoring liquidity guidelines, policies and procedures.  ALCO uses a variety of methods to monitor the liquidity position of Home Savings including a liquidity analysis that measures potential sources and uses of funds over future time periods out to one year.  ALCO also performs contingency funding analyses to determine Home Savings’ ability to meet potential liquidity needs under stress scenarios that cover varying time horizons ranging from immediate to long-term.

At June 30, 2017, United Community had total on-hand liquidity, defined as cash and cash equivalents, unencumbered securities and additional FHLB borrowing capacity, of $521.6 million.

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UNITED COMMUNITY FINANCIAL CORP.

AVERAGE BALANCE SHEETS

The following table presents the total dollar amounts of interest income and interest expense on the indicated amounts of average interest-earning assets or interest-bearing liabilities, together with the weighted average interest rates for the three months ended June 30, 2017 and 2016. Average balance calculations were based on daily balances.

	For the Three Months Ended June 30,
	2017							2016
	Average		Interest					Average		Interest
	outstanding		earned/		Yield/			outstanding		earned/		Yield/
	balance		paid		rate			balance		paid		rate
	(Dollars in thousands)
Interest earning assets:
Net loans (1)	$	1,863,525	$	20,012		4.30	%	$	1,369,683	$	14,186		4.14	%
Loans held for sale		80,205		872		4.35	%		37,521		363		3.87	%
Total loans, net		1,943,730		20,884		4.30	%		1,407,204		14,549		4.14	%
Securities:
Available for sale-taxable		258,217		1,479		2.29	%		315,583		1,781		2.26	%
Available for sale-nontaxable (2)		59,209		619		4.18	%		42,394		440		4.15	%
Held to maturity-taxable		80,817		454		2.25	%		95,933		524		2.18	%
Held to maturity-nontaxable (2)		9,843		79		3.21	%		12,971		96		2.96	%
Total securities		408,086		2,631		2.58	%		466,881		2,841		2.43	%
Federal Home Loan Bank stock		19,324		227		4.70	%		18,068		180		3.98	%
Other interest earning assets		22,129		40		0.72	%		18,978		15		0.32	%
Total interest earning assets		2,393,269		23,782		3.97	%		1,911,131		17,585		3.68	%
Non-interest earning assets		180,524							132,780
Total assets	$	2,573,793						$	2,043,911
Interest bearing liabilities:
Deposits:
Checking accounts	$	633,276		480		0.30	%	$	505,284		261		0.21	%
Savings accounts		308,683		27		0.03	%		291,820		34		0.05	%
Certificates of deposit
Customer certificates of deposit		504,397		1,166		0.92	%		434,053		1,201		1.11	%
Brokered certificates of deposit		133,082		314		0.94	%		—		—		—	%
Total certificates of deposit		637,479		1,480		0.93	%		434,053		1,201		1.11	%
Total interest bearing deposits		1,579,438		1,987		0.50	%		1,231,157		1,496		0.49	%
Federal Home Loan Bank advances
Long-term advances		48,019		370		3.08	%		47,237		307		2.60	%
Short-term advances		286,604		694		0.97	%		246,967		256		0.41	%
Total Federal Home Loan Bank advances		334,623		1,064		1.27	%		294,204		563		0.77	%
Repurchase agreements and other		4,844		8		0.66	%		527		6		4.55	%
Total borrowed funds		339,467		1,072		1.26	%		294,731		569		0.77	%
Total interest bearing liabilities	$	1,918,905		3,059		0.64	%	$	1,525,888		2,065		0.54	%
Non-interest bearing liabilities
Noninterest-bearing deposits		333,784							241,098
Other noninterest-bearing liabilities		38,771							29,751
Total noninterest bearing liabilities		372,555							270,849
Total liabilities	$	2,291,460						$	1,796,737
Shareholders’ equity		282,333							247,174
Total liabilities and equity	$	2,573,793						$	2,043,911
Net interest income and interest rate spread			$	20,723		3.33	%			$	15,520		3.14	%
Net interest margin						3.46	%						3.25	%
Average interest earning assets to average interest    bearing liabilities						124.72	%						125.25	%

(1) Nonaccrual loans are included in the average balance at a yield of 0%.

(2) Yields are on a fully taxable equivalent basis.

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The following table presents the total dollar amounts of interest income and interest expense on the indicated amounts of average interest-earning assets or interest-bearing liabilities, together with the weighted average interest rates for the six months ended June 30, 2017 and 2016. Average balance calculations were based on daily balances.

	For the Six Months Ended June 30,
	2017							2016
	Average		Interest					Average		Interest
	outstanding		earned/		Yield/			outstanding		earned/		Yield/
	balance		paid		rate			balance		paid		rate
	(Dollars in thousands)
Interest earning assets:
Net loans (1)	$	1,785,202	$	37,572		4.21	%	$	1,350,474	$	27,988		4.14	%
Loans held for sale		74,067		1,533		4.14	%		36,440		695		3.81	%
Total loans, net		1,859,269		39,105		4.21	%		1,386,914		28,683		4.14	%
Securities:
Available for sale-taxable		272,914		3,081		2.26	%		326,306		3,716		2.28	%
Available for sale-nontaxable (2)		59,285		1,240		4.18	%		30,362		630		4.15	%
Held to maturity-taxable		82,228		919		2.24	%		97,488		1,101		2.26	%
Held to maturity-nontaxable (2)		11,140		173		3.11	%		11,673		179		3.07	%
Total securities		425,567		5,413		2.54	%		465,829		5,626		2.42	%
Federal Home Loan Bank stock		19,116		441		4.61	%		18,068		362		4.01	%
Other interest earning assets		32,537		120		0.74	%		18,554		30		0.32	%
Total interest earning assets		2,336,489		45,079		3.86	%		1,889,365		34,701		3.67	%
Non-interest earning assets		173,537							132,985
Total assets	$	2,510,026						$	2,022,350
Interest bearing liabilities:
Deposits:
Checking accounts	$	599,279		817		0.27	%	$	493,318		527		0.21	%
Savings accounts		305,198		57		0.04	%		287,856		75		0.05	%
Certificates of deposit
Customer certificates of deposit		486,639		2,239		0.92	%		440,756		2,506		1.14	%
Brokered certificates of deposit		116,324		495		0.85	%		—		—		—	%
Total certificates of deposit		602,963		2,734		0.91	%		440,756		2,506		1.14	%
Total interest bearing deposits		1,507,440		3,608		0.48	%		1,221,930		3,108		0.51	%
Federal Home Loan Bank advances
Long-term advances		47,921		718		3.00	%		47,140		596		2.53	%
Short-term advances		316,660		1,301		0.82	%		241,857		497		0.41	%
Total Federal Home Loan Bank advances		364,581		2,019		1.11	%		288,997		1,093		0.76	%
Repurchase agreements and other		2,857		16		1.12	%		530		11		4.15	%
Total borrowed funds		367,438		2,035		1.11	%		289,527		1,104		0.76	%
Total interest bearing liabilities	$	1,874,878		5,643		0.60	%	$	1,511,457		4,212		0.56	%
Non-interest bearing liabilities
Noninterest-bearing deposits		320,578							234,714
Other noninterest-bearing liabilities		36,278							28,346
Total noninterest bearing liabilities		356,856							263,060
Total liabilities	$	2,231,734						$	1,774,517
Shareholders’ equity		278,292							247,833
Total liabilities and equity	$	2,510,026						$	2,022,350
Net interest income and interest rate spread			$	39,436		3.26	%			$	30,489		3.11	%
Net interest margin						3.38	%						3.23	%
Average interest earning assets to average interest    bearing liabilities						124.62	%						125.00	%

(1) Nonaccrual loans are included in the average balance at a yield of 0%.

(2) Yields are on a fully taxable equivalent basis.

67

ITEM 3. Quantitative and Qualitative Disclosures About Market Risk.

Qualitative Aspects of Market Risk. The principal market risk affecting United Community is interest rate risk. United Community is subject to interest rate risk to the extent that its interest-earning assets reprice differently than its interest-bearing liabilities. Interest rate risk is defined as the sensitivity of United Community’s earnings and net asset values to changes in interest rates. As part of its efforts to monitor and manage the interest rate risk, the Board of Directors of Home Savings has adopted an interest rate risk policy that requires the Home Savings Board to review quarterly reports related to interest rate risk and to annually set exposure limits for Home Savings as a guide to management in setting and implementing day to day operating strategies.

Quantitative Aspects of Market Risk. As part of its interest rate risk analysis, Home Savings uses the net portfolio value (NPV) and net interest income methodology. Generally, NPV is the discounted present value of the difference between incoming cash flows on interest-earning and other assets and outgoing cash flows on interest-bearing and other liabilities. The application of the methodology attempts to quantify interest rate risk as the change in the NPV and net interest income that would result from various levels of theoretical basis point changes in market interest rates.

Home Savings uses an NPV and earnings simulation model prepared internally as its primary method to identify and manage its interest rate risk profile. The model is based on actual cash flows and repricing characteristics for all financial instruments and incorporates market-based assumptions regarding the impact of changing interest rates on future volumes and the prepayment rate of applicable financial instruments. Assumptions based on the historical behavior of deposit rates and balances in relation to changes in interest rates also are incorporated into the model. These assumptions inherently are uncertain and, as a result, the model cannot measure precisely NPV or net interest income or precisely predict the impact of fluctuations in interest rates on net interest rate changes as well as changes in market conditions and management strategies.

Presented below are analyses of Home Savings’ interest rate risk as measured by changes in NPV and net interest income for instantaneous and sustained parallel shifts of 100 basis point increments in market interest rates.  As noted, for the quarter ended June 30, 2017 and the year ended December 31, 2016, the percentage changes fall within the policy limits set by the Board of Directors of Home Savings as the minimum NPV ratio and the maximum change in interest income the Home Savings Board deems advisable in the event of various changes in interest rates. See the table below for Board adopted policy limits.

Quarter Ended June 30, 2017
NPV as % of portfolio value of assets													Next 12 months net interest income
													(Dollars in thousands)
Change in rates (Basis points)	NPV Ratio			Internal policy limitations			Change in %			Internal policy limitations on NPV Change			$ Change			Internal policy limitations			% Change
400		11.63	%		6.00	%		(0.32	)%		-25.00	%	$	(1,574	)		(18.00	)%		(1.94	)%
300		11.93	%		6.00	%		(0.01	)%		-20.00	%		(1,094	)		(13.00	)%		(1.35	)%
200		12.14	%		7.00	%		0.20	%		-15.00	%		(637	)		(8.00	)%		(0.78	)%
100		12.37	%		7.00	%		0.43	%		-10.00	%		(553	)		(3.00	)%		(0.68	)%
Static		11.94	%		9.00	%		—	%		0.00	%		—			—	%		—	%
-100		11.06	%		7.00	%		(0.88	)%		-15.00	%		(1,727	)		(5.00	)%		(2.13	)%

Year Ended December 31, 2016
NPV as % of portfolio value of assets													Next 12 months net interest income
													(Dollars in thousands)
Change in rates (Basis points)	NPV Ratio			Internal policy limitations			Change in %			Internal policy limitations on NPV Change			$ Change			Internal policy limitations			% Change
400		10.04	%		6.00	%		(2.07	)%		-30.00	%	$	(8,716	)		(20.00	)%		(13.27	)%
300		10.73	%		6.00	%		(1.39	)%		-25.00	%		(6,903	)		(15.00	)%		(10.51	)%
200		11.35	%		7.00	%		(0.77	)%		-20.00	%		(4,198	)		(10.00	)%		(6.39	)%
100		11.88	%		7.00	%		(0.24	)%		-15.00	%		(1,726	)		(5.00	)%		(2.63	)%
Static		12.12	%		9.00	%		—	%		0.00	%		—			—	%		—	%

Due to a low interest rate environment, it was not meaningful to calculate results for a drop in interest rates at December 31, 2016.  For the quarter ended June 30, 2017, it was only meaningful to calculate a drop of 100 basis points.  

68

As with any method of measuring interest rate risk, certain shortcomings are inherent in the above approach. For example, although certain assets and liabilities may have similar maturities or periods of repricing, they may react in different degrees to changes in market interest rates. Also, the interest rates on certain types of assets and liabilities may fluctuate in advance of changes in market interest rates, while interest rates on other types may lag behind changes in market rates. Further, in the event of a change in interest rates, expected rates of prepayment on loans and early withdrawal levels from certificates of deposit may deviate significantly from those assumed in making risk calculations.

Potential Impact of Changes in Interest Rates. Home Savings’ profitability depends to a large extent on its net interest income, which is the difference between interest income from loans and securities and interest expense on deposits and borrowings. Like most financial institutions, Home Savings’ short-term interest income and interest expense are affected significantly by changes in market interest rates and other economic factors beyond its control.

ITEM 4. Controls and Procedures.

An evaluation was carried out by United Community’s management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of United Community’s disclosure controls and procedures (as defined in Rules 13a-15(e)/15d-15(e) of the Securities Exchange Act of 1934 (the Exchange Act)) as of June 30, 2017. Based on their evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that United Community’s disclosure controls and procedures as of June 30, 2017, were effective in ensuring that information required to be disclosed in the reports that United Community files or submits under the Exchange Act was recorded, processed, summarized and reported on a timely basis, including those controls and procedures designed to ensure that such information is accumulated and communicated to management, including United Community’s Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure. During the quarter ended June 30, 2017, there were no changes in United Community’s internal control over financial reporting that have materially affected or are reasonably likely to materially affect United Community’s internal control over financial reporting.

69

PART II. OTHER INFORMATION

UNITED COMMUNITY FINANCIAL CORP.

ITEM 1. Legal Proceedings.

United Community and its subsidiaries are parties to litigation arising in the normal course of business. While it is impossible to determine the ultimate resolution of these contingent matters, management believes any resulting liability would not have a material effect upon United Community’s financial statements.

ITEM 1A. Risk Factors.

There have been no material changes in United Community’s risk factors as outlined in United Community’s Annual Report on Form 10-K for the year ended December 31, 2016.  The risk factors described in the Annual Report on Form 10-K are not the only risks facing the Company.  Additional risks and uncertainties not currently known to the Company or that management currently deems to be immaterial also may materially adversely affect the Company’s business, financial condition and/or operating results.  Moreover, the Company undertakes no obligation and disclaims any intention to publish revised information or updates to forward-looking statements contained in such risk factors or in any other statement made at any time by the Company or any of its directors, officers, employees or other representatives, unless and until any such revisions or updates are expressly required to be disclosed by securities laws or regulations.

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds.

(a) None.

(b) Not applicable.

(c) The following table provides information concerning purchases of United Community’s common shares made by United Community during the three months ended June 30, 2017:

Period	Total number of common sharespurchased		Average price paid per common share		Total number of common shares purchased as part of publicly announced plans		Maximum number of shares that may yet be purchased under the plan(2)
April 1 through April 30, 2017(1)		20,709	$	8.34		—		1,683,830
May 1 through May 31, 2017		—		—		—		1,683,830
June 1 through June 30, 2017		—		—		—		1,683,830
Total		20,709	$	8.34		—		1,683,830

⁽¹⁾ In April 2017, United Community purchased 20,709 shares at $8.34 per share from employees for the payment of employment taxes.  The purchase of these shares was not part of United Community’s share repurchase program.  

⁽²⁾ United Community’s stock repurchase program was publically announced on April 28, 2016 in a press release, a copy of which can be found in United Community’s Form 8-K filed on May 2, 2016.  The program permits the repurchase of up to 2,500,000 common shares.  There is no expiration date for the program.

ITEM 3. Defaults Upon Senior Securities

Not Applicable

ITEM 4. Mine Safety Disclosures

Not Applicable

ITEM 5. Other Information

(a) None.

(b) None.

70

ITEM 6. Exhibits.

Exhibit Number	Description
2.1	Agreement and Plan of Merger by and among United Community Financial Corp., The Home Savings and Loan Company of Youngstown, Ohio, Ohio Legacy Corp. and Premier Bank & Trust, dated September 8, 2016.
3.1	Articles of Incorporation (reflecting all amendments filed with the Ohio Secretary of State) [for purposes of SEC reporting compliance only – not filed with the Ohio Secretary of State]
3.2	Amended Code of Regulations
10.1	Severance and Change in Control Agreement with Timothy W. Esson
10.2	Severance and Change in Control Agreement with Matthew T. Garrity
10.3	Severance and Change in Control Agreement with Jude J. Nohra
10.4	Severance and Change in Control Agreement with Barbara J. Radis
31.1	Section 302 Certification by Chief Executive Officer
31.2	Section 302 Certification by Chief Financial Officer
32	Section 1350 Certifications by Chief Executive Officer and Chief Financial Officer
101	The following materials from the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2017, formatted in XBRL (Extensible Business Reporting Language): (i) the Consolidated Statements of Financial Condition, (ii) the Consolidated Statements of Operations and Comprehensive Income (Loss), (iii) the Consolidated Statements of Changes in Shareholders’ Equity, (iv) the Consolidated Statements of Cash Flows and (v) the Notes to Unaudited Consolidated Financial Statements.

71

UNITED COMMUNITY FINANCIAL CORP.

SIGNATURES

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

	UNITED COMMUNITY FINANCIAL CORP.
Date: August 9, 2017	/s/ Gary M. Small
	Gary M. Small President and Chief Executive Officer
	(Principal Executive Officer)
Date: August 9, 2017	/s/ Timothy W. Esson
	Timothy W. Esson Chief Financial Officer
	(Principal Financial Officer)

72

UNITED COMMUNITY FINANCIAL CORP.

EXHIBIT INDEX

Exhibit 2.1

Incorporated by reference to Exhibit 2.1 in the Third Quarter Form 10-Q filed by United Community on November 8, 2016 with the SEC, film number 161981248.

Exhibit 3.1

Incorporated by reference to Exhibit 3.1 in the Second Quarter 2016 Form 10-Q filed by United Community on August 5, 2016 with the SEC, film number 161811451.

Exhibit 3.2

Incorporated by reference to Exhibit 3.2 in the 1998 Form 10-K filed by United Community on March 31, 1999 with the SEC, film number 99582343.

Exhibit 10.1

Incorporated by reference to Exhibit 10.1 in the Form 8-K filed by United Community on July 7, 2017 with the SEC, film number 17955395.

Exhibit 10.2

Incorporated by reference to Exhibit 10.2 in the Form 8-K filed by United Community on July 7, 2017 with the SEC, film number 17955395.

Exhibit 10.3

Incorporated by reference to Exhibit 10.3 in the Form 8-K filed by United Community on July 7, 2017 with the SEC, film number 17955395.

Exhibit 10.4

Incorporated by reference to Exhibit 10.4 in the Form 8-K filed by United Community on July 7, 2017 with the SEC, film number 17955395.

73

EX-31.1

Exhibit 31.1

RULE 13a-14(a)/15d-14(a) CERTIFICATION

I, Gary M. Small, certify that:

1) I have reviewed this report on Form 10-Q of United Community Financial 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(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5) The registrant’s other certifying officer(s) 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/ Gary M. Small

Gary M. Small

President and Chief Executive Officer

(Principal Executive Officer)

August 9, 2017

EX-31.2

Exhibit 31.2

RULE 13a-14(a)/15d-14(a) CERTIFICATION

I, Timothy W. Esson, certify that:

1) I have reviewed this report on Form 10-Q of United Community Financial 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(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5) The registrant’s other certifying officer(s) 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/ Timothy W. Esson

Timothy W. Esson

Chief Financial Officer

(Principal Financial Officer)

August 9, 2017

EX-32

Exhibit 32

UNITED COMMUNITY FINANCIAL CORP.

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of United Community Financial Corp. (the “Company”) on Form 10-Q for the period ending June 30, 2017 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), we certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/S/ Gary M. Small	/S/ Timothy W. Esson
Gary M. Small President and Chief Executive Officer	Timothy W. Esson Chief Financial Officer
(Principal Executive Officer)	(Principal Financial Officer)
August 9, 2017	August 9, 2017

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2017	Jul. 31, 2017
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2017
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	Q2
Trading Symbol	UCFC
Entity Registrant Name	UNITED COMMUNITY FINANCIAL CORP
Entity Central Index Key	0000707886
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		49,738,735

XML

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Unaudited) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Assets:
Cash and deposits with banks	$ 42,654	$ 27,690
Federal funds sold	9,360	18,197
Total cash and cash equivalents	52,014	45,887
Securities:
Available for sale, at fair value	287,179	343,284
Held to maturity, (fair value of $87,775 and $96,150, respectively)	88,559	97,519
Loans held for sale, at lower of cost or market	199	165
Loans held for sale, at fair value	85,954	62,593
Loans, net of allowance for loan losses of $19,660 and $19,087	1,869,095	1,503,577
Federal Home Loan Bank stock, at cost	19,324	18,068
Premises and equipment, net	22,424	20,963
Accrued interest receivable	7,420	6,900
Real estate owned and other repossessed assets, net	1,197	1,777
Goodwill	19,467	208
Cash surrender value of life insurance	56,628	55,861
Other assets	39,946	33,182
Total assets	2,553,565	2,191,345
Deposits:
Non-interest bearing	339,067	256,918
Interest bearing
Customer deposits	1,423,327	1,181,557
Brokered deposits	131,599	76,516
Total interest bearing deposits	1,554,926	1,258,073
Total deposits	1,893,993	1,514,991
Federal Home Loan Bank advances
Long-term Federal Home Loan Bank advances	48,146	47,756
Short-term Federal Home Loan Bank advances	280,000	343,000
Total Federal Home Loan Bank advances	328,146	390,756
Repurchase agreements and other	8,045	512
Total borrowed funds	336,191	391,268
Advance payments by borrowers for taxes and insurance	21,989	23,812
Accrued interest payable	392	145
Accrued expenses and other liabilities	15,520	11,323
Total liabilities	2,268,085	1,941,539
Shareholders' Equity:
Preferred stock-no par value; 1,000,000 shares authorized and no shares issued and outstanding
Common stock-no par value; 499,000,000 shares authorized; 54,138,910 shares issued and 49,715,021 and 46,581,370 shares, respectively, outstanding	177,478	174,360
Retained earnings	159,422	152,675
Accumulated other comprehensive income (loss)	(18,448)	(21,040)
Treasury stock, at cost, 4,423,889 and 7,557,540 shares, respectively	(32,972)	(56,189)
Total shareholders’ equity	285,480	249,806
Total liabilities and shareholders’ equity	2,553,565	2,191,345
Customer list intangible [Member]
Securities:
Intangible assets	2,060	1,356
Core deposit intangibles [Member]
Securities:
Intangible assets	$ 2,099	$ 5

XML

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Unaudited) (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Statement Of Financial Position [Abstract]
Held to maturity, Fair Value	$ 87,775	$ 96,150
Allowance for loan losses	$ 19,660	$ 19,087
Preferred stock, par value
Preferred stock, shares authorized	1,000,000	1,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value
Common stock, shares authorized	499,000,000	499,000,000
Common stock, shares issued	54,138,910	54,138,910
Common stock, shares outstanding	49,715,021	46,581,370
Treasury stock, shares	4,423,889	7,557,540

XML

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Interest income
Loans	$ 20,011	$ 14,184	$ 37,569	$ 27,985
Loans held for sale	872	363	1,533	695
Securities available for sale, nontaxable	418	290	836	413
Securities available for sale, taxable	1,479	1,781	3,081	3,716
Securities held to maturity, nontaxable	52	62	114	117
Securities held to maturity, taxable	454	524	919	1,101
Federal Home Loan Bank stock dividends	227	180	441	362
Other interest earning assets	40	15	120	30
Total interest income	23,553	17,399	44,613	34,419
Interest expense
Deposits	1,987	1,496	3,608	3,108
Federal Home Loan Bank advances	1,064	563	2,019	1,093
Repurchase agreements and other	8	6	16	11
Total interest expense	3,059	2,065	5,643	4,212
Net interest income	20,494	15,334	38,970	30,207
Provision for loan losses	842	395	2,317	2,550
Net interest income after provision for loan losses	19,652	14,939	36,653	27,657
Non-interest income
Insurance agency income	472	516	945	818
Brokerage income	301	396	623	696
Deposit related fees	1,411	1,362	2,701	2,688
Mortgage servicing fees	729	701	1,465	1,399
Mortgage servicing rights valuation	(2)	(292)	(5)	(727)
Mortgage servicing rights amortization	(486)	(567)	(935)	(1,035)
Other service fees	33	47	62	65
Net gains:
Securities available for sale (includes $301, $233, $330 and $386, respectively, accumulated other comprehensive income reclassifications for unrealized net gains on available for sale securities)	301	233	330	386
Mortgage banking income	2,117	1,869	3,440	3,251
Real estate owned and other repossessed assets, net	(18)	(63)	(70)	(76)
Debit/credit card fees	1,326	1,120	2,249	2,001
Trust fees	420		702
Other income	486	458	967	972
Total non-interest income	7,090	5,780	12,474	10,438
Non-interest expense
Salaries and employee benefits (includes $0, $(278), $0 and $(556), respectively, accumulated other comprehensive income reclassifications from prior service credit on postretirement plan).	8,749	7,186	17,724	14,274
Occupancy	943	855	1,907	1,717
Equipment and data processing	2,306	1,887	4,385	3,722
Financial institutions tax	510	431	1,000	873
Advertising	265	221	389	348
Amortization of intangible assets	113	10	196	23
FDIC insurance premiums	340	287	528	613
Other insurance premiums	109	73	221	162
Legal and consulting fees	184	214	413	411
Other professional fees	420	351	940	421
Real estate owned and other repossessed asset expenses	23	77	85	149
Acquisition costs			4,962
Other expenses	1,214	1,268	2,716	2,611
Total non-interest expenses	15,176	12,860	35,466	25,324
Income before income taxes	11,566	7,859	13,661	12,771
Income tax expense (includes $105, $178, $115 and $329 income tax expense from reclassification items)	3,377	2,529	3,934	4,121
Net income	8,189	5,330	9,727	8,650
Other comprehensive income
Unrealized gain on securities, available for sale, net of reclassifications and tax of $842, $2,392, $1,362 and $5,852, respectively	1,562	4,442	2,527	10,871
Accretion of unrealized losses on securities transferred from available for sale to held to maturity, net of tax of $17, $20, $35 and $38, respectively	32	37	65	71
Accretion of unrecognized actuarial gains and amortization of prior service credit on postretirement plan, net of tax of $0, $(97), $0 and $(194), respectively recognized in net income		(181)		(362)
Total other comprehensive income	1,594	4,298	2,592	10,580
Comprehensive income	$ 9,783	$ 9,628	$ 12,319	$ 19,230
Earnings per share
Basic	$ 0.16	$ 0.11	$ 0.20	$ 0.18
Diluted	$ 0.16	$ 0.11	$ 0.20	$ 0.18

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CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (Unaudited) (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Income Statement [Abstract]
Accumulated other comprehensive income	$ 301	$ 233	$ 330	$ 386
Accumulated other comprehensive income reclassification from prior service credit on postretirement plan	0	(278)	0	(556)
Income tax expense from reclassification items	105	178	115	329
Unrealized gain on securities available for sale, net of reclassifications, tax	842	2,392	1,362	5,852
Accretion of unrealized losses on securities transferred from available for sale to held to maturity, tax	17	20	35	38
Accretion of unrecognized actuarial gains and amortization of prior service credit on postretirement plan, tax	$ 0	$ (97)	$ 0	$ (194)

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CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands	Total	Ohio Legacy Corp. [Member]	James & Sons Insurance [Member]	Common Stock [Member]	Common Stock [Member] Ohio Legacy Corp. [Member]	Common Stock [Member] James & Sons Insurance [Member]	Retained Earnings [Member]	Retained Earnings [Member] James & Sons Insurance [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Treasury Stock [Member]	Treasury Stock [Member] Ohio Legacy Corp. [Member]	Treasury Stock [Member] James & Sons Insurance [Member]
Balance at Dec. 31, 2015	$ 244,245			$ 174,304			$ 140,819		$ (19,220)	$ (51,658)
Balance, shares at Dec. 31, 2015				47,517,644
Net income	8,650						8,650
Other comprehensive income	10,580								10,580
Stock option exercises, value	130						(397)			527
Stock option exercises, shares				69,000
Stock option expense	6			$ 6
Restricted stock grants, value				$ (1,031)			(313)			1,344
Restricted stock grants, shares				173,904
Restricted stock expense	462			$ 462
Restricted stock forfeitures, value				$ 3			7			(10)
Restricted stock forfeitures, shares				(1,014)
Purchase of shares, value			$ 1,508					$ (541)				$ 2,049
Purchase of shares, shares						262,705
Cash dividend payments	(2,381)						(2,381)
Treasury stock purchases, value	(9,125)									(9,125)
Treasury stock purchases, shares				(1,529,712)
Balance at Jun. 30, 2016	254,075			$ 173,744			145,844		(8,640)	(56,873)
Balance, shares at Jun. 30, 2016				46,492,527
Balance at Mar. 31, 2016									(12,938)
Net income	5,330
Other comprehensive income	4,298
Balance at Jun. 30, 2016	254,075			$ 173,744			145,844		(8,640)	(56,873)
Balance, shares at Jun. 30, 2016				46,492,527
Balance at Dec. 31, 2016	249,806			$ 174,360			152,675		(21,040)	(56,189)
Balance, shares at Dec. 31, 2016				46,581,370
Net income	9,727						9,727
Other comprehensive income	2,592								2,592
Stock option exercises, value	$ 74			$ (176)						250
Stock option exercises, shares	33,418			33,418
Stock option expense	$ 1			$ 1
Restricted stock grants, value				$ (511)						511
Restricted stock grants, shares				68,761
Restricted stock expense	456			$ 456
Vesting of Long-term Incentive Plan, value	597			$ 87						510
Vesting of Long-term Incentive Plan, shares				68,783
Purchase of shares, value		$ 25,816			$ 3,261						$ 22,555
Purchase of shares, shares					3,033,604
Cash dividend payments	(2,980)						(2,980)
Treasury stock purchases, value	(609)									(609)
Treasury stock purchases, shares				(70,915)
Balance at Jun. 30, 2017	285,480			$ 177,478			159,422		(18,448)	(32,972)
Balance, shares at Jun. 30, 2017				49,715,021
Balance at Mar. 31, 2017									(20,042)
Net income	8,189
Other comprehensive income	1,594
Balance at Jun. 30, 2017	$ 285,480			$ 177,478			$ 159,422		$ (18,448)	$ (32,972)
Balance, shares at Jun. 30, 2017				49,715,021

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CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited) (Parenthetical) - $ / shares	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Statement Of Stockholders Equity [Abstract]
Cash dividend payments, per share	$ 0.06	$ 0.05

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Cash Flows from Operating Activities
Net income	$ 9,727,000	$ 8,650,000
Adjustments to reconcile net income to net cash provided by operating activities
Provision for loan losses	2,317,000	2,550,000
Mortgage banking income	(540,000)	(1,602,000)
Changes in fair value on loans held for sale	(2,900,000)	(1,649,000)
Net losses on real estate owned and other repossessed assets sold	70,000	76,000
Net gain on available for sale securities sold	(330,000)	(386,000)
Net gain on other assets sold		(2,000)
Amortization of premiums and accretion of discounts	1,911,000	4,234,000
Depreciation and amortization	1,321,000	1,139,000
Net change in interest receivable	159,000	(456,000)
Net change in interest payable	176,000	46,000
Net change in prepaid and other assets	2,466,000	(75,000)
Net change in other liabilities	2,924,000	(130,000)
Stock based compensation	457,000	468,000
Net principal disbursed on loans originated for sale	(114,733,000)	(125,930,000)
Proceeds from sale of loans held for sale	121,673,000	119,974,000
Net change in deferred tax assets	(2,043,000)	3,595,000
Cash surrender value of life insurance	(767,000)	(730,000)
Tax benefit recognized on stock based compensation	(198,000)
Net change in interest rate caps		3,000
Net cash from operating activities	21,690,000	9,775,000
Cash Flows from Investing Activities
Proceeds from the principal repayments and maturities of securities available for sale	16,063,000	16,845,000
Proceeds from the principal repayments and maturities of securities held to maturity	8,732,000	6,126,000
Proceeds from the sale of securities available for sale	53,171,000	28,530,000
Proceeds from the sale of real estate owned and other repossessed assets	881,000	1,570,000
Proceeds from the sale of loans held for investment	2,250,000	1,000
Proceeds from the sale of premises and equipment	3,000	2,000
Purchases of premises and equipment	(1,547,000)	(1,024,000)
Principal disbursed on loans, net of repayments	(111,004,000)	(69,959,000)
Loans purchased	(27,039,000)	(15,693,000)
Purchase of securities available for sale		(38,843,000)
Purchase of securities held to maturity		(3,200,000)
Net cash from investing activities	(32,818,000)	(75,538,000)
Cash Flows from Financing Activities
Net increase in checking, savings and money market accounts	47,573,000	44,415,000
Net (decrease) increase in certificates of deposit	65,291,000	(24,412,000)
Net decrease in advance payments by borrowers for taxes and insurance	(2,356,000)	(1,575,000)
Net change in short-term FHLB advances	(86,500,000)	64,000,000
Net change in repurchase agreements and other borrowed funds	(3,238,000)	(12,000)
Proceeds from the exercise of stock options	74,000	130,000
Dividends paid	(2,980,000)	(2,381,000)
Purchase of treasury stock	(609,000)	(9,125,000)
Net cash from financing activities	17,255,000	71,040,000
Change in cash and cash equivalents	6,127,000	5,277,000
Cash and cash equivalents, beginning of period	45,887,000	35,910,000
Cash and cash equivalents, end of period	52,014,000	41,187,000
Eich Brothers Insurance [Member]
Cash Flows from Investing Activities
Net cash paid in acquisition	(107,000)
OLCB [Member]
Cash Flows from Investing Activities
Net cash received in acquisition	$ 25,779,000	$ 107,000

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BASIS OF PRESENTATION

6 Months Ended

Jun. 30, 2017

Accounting Policies [Abstract]

BASIS OF PRESENTATION

1. BASIS OF PRESENTATION

United Community Financial Corp. (United Community or the Company) was incorporated in the State of Ohio in February 1998 for the purpose of owning all of the outstanding capital stock of Home Savings and Loan Company of Youngstown, Ohio (Home Savings or the Bank) issued upon the conversion of Home Savings from a mutual savings association to a permanent capital stock savings association (Conversion). Upon consummation of the Conversion on July 8, 1998, United Community became the unitary thrift holding company for Home Savings.  Home Savings conducts its business from its main office located in Youngstown, Ohio, 35 retail banking offices and 12 loan production centers located throughout Ohio, western Pennsylvania and West Virginia.  

On January 29, 2016, United Community acquired James & Sons Insurance.  James & Sons Insurance was merged into HSB Insurance, LLC.  HSB Insurance, LLC d/b/a James & Sons Insurance is an insurance agency that offers a wide variety of insurance products for business and residential customers, which include auto, homeowners, life-health, commercial, surety bonds and aviation. On February 28, 2017, James & Sons Insurance acquired Eich Brothers Insurance. Eich Brothers Insurance is an insurance agency that offers insurance products for business and residential customers, which include auto, commercial, home owners and life-health.  

On January 31, 2017, United Community completed its acquisition of Ohio Legacy Corp. (OLCB).  Immediately following the acquisition of OLCB, Home Savings was merged into Premier Bank & Trust, OLCB’s wholly-owned subsidiary state chartered bank (PB&T), and PB&T changed its name to Home Savings Bank.  As a result of the acquisition, United Community issued 3,033,604 United Community common shares and paid $20.4 million to OLCB shareholders.   Also, in connection with the acquisition, United Community became a financial holding company, and its wholly owned subsidiary is now an Ohio bank.

HSB Insurance, Inc., a wholly-owned subsidiary of the Company which was formed and began operations on June 1, 2017, is a Delaware-based captive insurance company which insures against certain risks unique to the operations of the Company and its subsidiaries and for which insurance may not be currently available or economically feasible in today's insurance marketplace. HSB Insurance, Inc. pools resources with several other similar insurance company subsidiaries of financial institutions to spread a limited amount of risk among themselves.  HSB Insurance, Inc. is subject to regulations of the State of Delaware and undergoes periodic examinations by the Delaware Division of Insurance.

The accompanying consolidated financial statements of United Community have been prepared in accordance with instructions relating to Form 10-Q.  Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles (U.S. GAAP) for complete financial statements. However, such information reflects all adjustments (consisting solely of normal recurring adjustments) that are, in the opinion of management, necessary for a fair statement of results for the interim periods.

The results of operations for the three and six months ended June 30, 2017, are not necessarily indicative of the results to be expected for the year ending December 31, 2017. The consolidated financial statements and notes thereto should be read in conjunction with the audited financial statements and notes contained in United Community’s Form 10-K for the year ended December 31, 2016.

The consolidated financial statements include the accounts of United Community and its subsidiaries, Home Savings, HSB Insurance, LLC, HSB Capital, LLC and HSB Insurance, Inc.  All material inter-company transactions have been eliminated.  Some items in the prior year financial statements were reclassified to conform to the current presentation. These reclassifications had no effect on prior year consolidated statements of operations or shareholders’ equity.

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RECENT ACCOUNTING DEVELOPMENTS

6 Months Ended

Jun. 30, 2017

Accounting Changes And Error Corrections [Abstract]

RECENT ACCOUNTING DEVELOPMENTS

2. RECENT ACCOUNTING DEVELOPMENTS

In May 2014, FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606).  The ASU implements a common revenue standard that clarifies the principles for recognizing revenue. The core principle of ASU 2014-09 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply the following steps: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract and (v) recognize revenue when (or as) the entity satisfies a performance obligation. ASU 2014-09 was originally going to be effective on January 1, 2017; however, the FASB recently issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606) – Deferral of the Effective Date which deferred the effective date of ASU 2014-09 by one year to January 1, 2018. United Community’s revenue is comprised of net interest income on financial assets and financial liabilities, which is explicitly excluded from the scope of ASU 2014-09, and non-interest income. We expect that ASU 2014-09 will require us to change how we recognize certain insurance commissions and fees; however, we do not expect these changes to have a significant impact on our financial statements. Additional disclosures will be required to provide quantitative and qualitative information regarding the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. We continue to evaluate the impact of ASU 2014-09 on other components of non-interest income.

In January 2016, the FASB issued ASU 2016-01, Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. ASU 2016-01, among other things, (i) requires equity investments, with certain exceptions, to be measured at fair value with changes in fair value recognized in net income, (ii) simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment, (iii) eliminates the requirement for public business entities to disclose the methods and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet, (iv) requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes, (v) requires an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments, (vi) requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or the accompanying notes to the financial statements and (viii) clarifies that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities. The new guidance is effective for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2017.  Management is currently evaluating the impact of the adoption of this guidance on the Company’s consolidated financial statements and expects revisions to disclosures included in the consolidated financial statements.

In February 2016, the FASB issued ASU 2016-02 - Leases (Topic 842). The ASU will require all organizations that lease assets to recognize on the balance sheet the assets and liabilities for the rights and obligations created by those leases. Additional qualitative and quantitative disclosures will be required so that users can understand more about the nature of an entity’s leasing activities. The new guidance is effective for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2018. Early adoption is permitted. Management is currently evaluating the impact of the adoption of this guidance on the Company’s consolidated financial statements and expects to recognize an increase in other assets and other liabilities for the rights and obligations created by leasing of branch offices.  Management also expects minimal impact in the income statement with respect to occupancy expense related to leases.

In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, which amends ASC Topic 718, Compensation - Stock Compensation. The ASU includes provisions intended to simplify various aspects related to how share-based payments are accounted for and presented in the financial statements.  Key provisions include the elimination of “windfall pools” and removes the requirement to delay recognition of a windfall tax benefit until it reduces current taxes payable.  Additionally, the simplification permits entities to withhold an amount up to the employees’ maximum individual tax rate in the relevant jurisdiction without resulting in a liability classification of the award.  Entities are now permitted to make accounting policy elections for the impact of forfeitures on the recognition of expense for share-based payment awards.  This ASU was adopted on January 1, 2017.  The Company recognized a tax benefit of $198,000 in income tax expense during the six months ended June 30, 2017 as a result of adoption related to vesting of restricted stock awards and exercised stock options.    

In June 2016, FASB Issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.   This ASU adds a new Topic 326 to the Codification and removes the thresholds that companies apply to measure credit losses on financial instruments measured at amortized cost, such as loans, receivables, and held-to-maturity debt securities. Under current U.S. GAAP, companies generally recognize credit losses when it is probable that the loss has been incurred. The revised guidance will remove all recognition thresholds and will require companies to recognize an allowance for credit losses for the difference between the amortized cost basis of a financial instrument and the amount of amortized cost that the company expects to collect over the instrument’s contractual life. ASU 2016-13 also amends the credit loss measurement guidance for available-for-sale debt securities and beneficial interests in securitized financial assets. The guidance in ASU 2016-13 is effective for “public business entities,” as defined, that are SEC filers for fiscal years, and for interim periods with those fiscal years, beginning after December 15, 2019.  Early adoption of the guidance is permitted for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Management is currently evaluating the impact of the adoption of this guidance on the Company’s consolidated financial statements.  Management is aggregating the necessary data requirements and addressing any data-archiving improvements necessary for the implementation of this ASU.

In August 2016, FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments, which amends the guidance in ASC 230 on the classification of certain cash receipts and payments in the statement of cash flows. The primary purpose of the ASU is to reduce the diversity in practice that has resulted from the lack of consistent principles on this topic. The ASU’s amendments add or clarify guidance on eight cash flow issues:

• Debt prepayment or debt extinguishment costs.

• Settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing.

• Contingent consideration payments made after a business combination.

• Proceeds from the settlement of insurance claims.

• Proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies.

• Distributions received from equity method investees.

• Beneficial interests in securitization transactions.

• Separately identifiable cash flows and application of the predominance principle.

For public business entities, the guidance in the ASU is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years.  Early adoption is permitted for all entities. Entities must apply the guidance retrospectively to all periods presented but may apply it prospectively from the earliest date practicable if retrospective application would be impracticable.  Management is currently evaluating the impact of the adoption of this guidance on the Company’s consolidated financial statements.

In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. This ASU eliminates Step 2 from the goodwill impairment test. Instead, under the new guidance, an entity is to perform its annual goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge would be recognized for the amount by which the carrying amount exceeds the reporting unit's fair value. The new guidance is effective for annual reporting periods, and interim reporting periods within those annual periods, beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The adoption of this guidance is not expected to have an impact on the Company’s consolidated financial statements.

In March 2017, the FASB issuedASU 2017-08, Receivables - Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities. This ASU amends the amortization period for certain purchased callable debt securities held at a premium. It shortens the amortization period for the premium to the earliest call date. Under current U.S. GAAP, premiums on callable debt securities generally are amortized to the maturity date. The new guidance is effective for annual reporting periods, and interim reporting periods within those annual periods, beginning after December 15, 2018. Early adoption is permitted for interim or annual periods. The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements.

In May 2017, the FASB issuedASU No. 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting . ASU 2017-09 applies to entities that change the terms or conditions of a share-based payment award.  The FASB adopted ASU 2017-09 to provide clarity and reduce diversity in practice as well as cost and complexity when applying the guidance in Topic 718, Compensation—Stock Compensation , to the modification of the terms and conditions of a share-based payment award.

The amendments in ASU 2017-09 include guidance on determining which changes to the terms and conditions of share-based payment awards require an entity to apply modification accounting under Topic 718.

These amendments require the entity to account for the effects of a modification unless all of the following conditions are met:

• The fair value (or calculated value or intrinsic value, if such an alternative measurement method is used) of the modified award is the same as the fair value (or value using an alternative measurement method) of the original award immediately before the original award is modified. If the modification does not affect any of the inputs to the valuation technique that the entity uses to value the award, the entity is not required to estimate the value immediately before and after the modification;

• The vesting conditions of the modified award are the same as the vesting conditions of the original award immediately before the original award is modified; and

• The classification of the modified award as an equity instrument or a liability instrument is the same as the classification of the original award immediately before the original award is modified.

The amendments are effective for all entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted, including adoption in any interim period for. The amendments should be applied prospectively to an award modified on or after the adoption date.  The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements.

In July 2017, the FASB ASU No. 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480);Derivatives and Hedging (Topic 815 ): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception.  ASU 2017-11 simplifies the accounting for certain financial instruments with down round features, a provision in an equity-linked financial instrument (or embedded feature) that provides a downward adjustment of the current exercise price based on the price of future equity offerings.

The new ASU will require companies to disregard the down round feature when assessing whether the instrument is indexed to its own stock, for purposes of determining liability or equity classification. Companies that provide earnings per share (EPS) data will adjust their basic EPS calculation for the effect of the feature when triggered (i.e., when the exercise price of the related equity-linked financial instrument is adjusted downward because of the down round feature) and will also recognize the effect of the trigger within equity.

The provisions of the new ASU related to down rounds are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020. Early adoption is permitted for all entities.  The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements.

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STOCK COMPENSATION

6 Months Ended

Jun. 30, 2017

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

STOCK COMPENSATION

3. STOCK COMPENSATION

Stock Options:

On April 30, 2015, shareholders approved the United Community Financial Corp. 2015 Long-Term Incentive Compensation Plan (the 2015 Plan). The purpose of the 2015 Plan is to provide a means through which United Community may attract and retain employees and non-employee directors, to provide incentives that align their interest with those of United Community’s shareholders and promote the success of United Community’s business.  All employees and non-employee directors are eligible to participate in the 2015 Plan.  The 2015 Plan provides for the issuance of up to 1,200,000 shares that are to be used for awards of stock options, stock awards, stock units, stock appreciation rights, annual bonus awards and long-term incentive awards.

On April 26, 2007, shareholders approved the United Community Financial Corp. 2007 Long-Term Incentive Plan (as amended, the 2007 Plan). The purpose of the 2007 Plan was to promote and advance the interests of United Community and its shareholders by enabling United Community to attract, retain and reward directors, directors emeritus, managerial and other key employees of United Community, including Home Savings, by facilitating their purchase of an ownership interest in United Community. The 2007 Plan was terminated on April 30, 2015 upon the adoption of the 2015 Plan, although the 2007 Plan survives with respect to awards issued under the 2007 Plan that remain outstanding and exercisable.  The 2007 Plan provided for the issuance of up to 2,000,000 shares that were to be used for awards of restricted stock, stock options, performance awards, stock appreciation rights (SARs), or other forms of stock-based incentive awards.  Because the 2007 Plan terminated, no additional awards may be made under it.

On July 12, 1999, shareholders approved the United Community Financial Corp. 1999 Long-Term Incentive Plan (as amended, the 1999 Plan). The purpose of the 1999 Plan was the same as the 2007 Plan. The 1999 Plan terminated on May 20, 2009, although the 1999 Plan survives with respect to options issued under the 1999 Plan remain outstanding and exercisable. The 1999 Plan provided for the grant of either incentive or nonqualified stock options. Options were awarded at exercise prices that were not less than the fair market value of the share at the grant date. The maximum number of common shares that could be issued under the 1999 Plan was 3,569,766. Because the 1999 Plan terminated, no additional options may be issued under it.

There were no stock options granted in the six months ended June 30, 2017 and 2016. Any options granted must be exercised within 10 years from the date of grant.  Expenses related to prior stock option grants are included with salaries and employee benefits. The Company recognized $0  and $1,000 in stock option expense for the three and six months ended June 30, 2017.  The Company recognized $3,000 and $6,000 in stock option expense for the three and six months ended June 30, 2016. The Company expects to recognize additional expense of $0 for the remainder of 2017.

A summary of option activity in the plans is as follows:

	For the six months ended
	June 30, 2017
				Weighted		Aggregate
				average		intrinsic value
	Shares			exercise price		(in thousands)
Outstanding at beginning of year		371,218		$	2.55
Granted		—
Exercised		(33,418	)		2.18
Forfeited and expired		(600	)		2.10
Outstanding at end of period		337,200			2.55	$	1,931
Shares subject to options exercisable at end of period		337,200			2.55	$	1,931

Information related to stock options for the three months ended June 30, 2017 and 2016 follows:

	June 30, 2017		June 30, 2016
Intrinsic value of options exercised	$	208,633	$	283,310
Cash received from option exercises		72,818		129,940
Tax benefit realized from option exercises		73,022		—
Weighted average fair value of options granted, per share	$	—	$	—

As of June 30, 2017, the cost of nonvested stock options is expected to be recognized over a weighted-average period of 3 months.

Outstanding stock options at June 30, 2017 have a weighted average remaining life of 2.91 years and may be exercised in the range of $1.20 to $5.89 per share.

Restricted Stock Awards:

The 2007 Plan permitted and the 2015 Plan permits the issuance of restricted stock awards to employees and nonemployee directors. Nonvested shares at June 30, 2017 aggregated 277,168, of which 16,553 are expected to vest during the remainder of 2017, 122,375 in 2018, 105,567 in 2019 and 32,673 in 2020. Expense related to restricted stock awards is charged to salaries and employee benefits and is recognized over the vesting period of the awards based on the fair value of the shares at the grant date. The Company recognized approximately $185,000 and $456,000 in restricted stock award expenses for the three and six months ended June 30, 2017. The Company recognized approximately $247,000 and $462,000 in restricted stock award expense for the three and six months ended June 30, 2016.  The Company expects to recognize additional expenses of approximately $365,000 in 2017, $503,000 in 2018, $210,000 in 2019 and $11,000 in 2020.  The total average per share fair value of shares vested during the six months ended June 30, 2017 was $8.63.

A summary of changes in the Company’s nonvested restricted shares for the six months ended June 30, 2017 is as follows:

	For the six months ended
	June 30, 2017
				Weighted
				average
				grant date
	Shares			fair value
Nonvested at beginning of year		341,184		$	5.50
Granted		68,761		$	8.62
Vested		(132,777	)	$	4.91
Forfeited		—		$	—
Nonvested shares at end of period		277,168		$	6.56

Annual Incentive Plan

The Annual Incentive Plan (AIP) provides incentive compensation awards to certain officers of the Company. Annual incentive awards are generally based upon the actual performance of the Company and individual participant performance for the twelve months ending December 31, compared to the actual performance of a peer group during the same twelve-month period. The target incentive awards for each year are measured as a percentage of the base salary of participating officers.  Once the awards under the AIP are calculated, they are paid in cash and/or restricted stock. The restricted stock vests equally over three years, beginning on the first anniversary of the date the restricted stock is issued.  The Company incurred $46,000 and $122,000 in expense for the restricted stock portion of the AIP for the three and six months ended June 30, 2017, respectively and $434,000 and $930,000for the cash portion of the AIP for the three and six months ended June 30, 2017, respectively.  The Company incurred $93,000 and $170,000 in expense for the restricted stock portion of the AIP for the three and six months ended June 30, 2016, respectively and $293,000 and $618,000 for the cash portion of the AIP for the three and six months ended June 30, 2016, respectively.  

Long-term Incentive Plan

The Long-term Incentive Plan (LTIP) provides a long-term incentive compensation opportunity to certain executive officers, whose participation and target award opportunities will be approved by the Compensation Committee of the Board of Directors. Each participant in the LTIP will be granted a target number of Performance Share Units (PSUs).  Target PSUs will be determined as a percentage of base salary and translated into share units based on the Company’s average stock price at the appropriate measurement date.  The performance period for the annual grant for a given year will be from January 1, year 1 through December 31, year 3.   The Company incurred $(4,000) and $149,000 for the LTIP for the three and six months ended June 30, 2017, respectively.  The Company incurred $97,000 and $193,000 in expense for the LTIP for the three and six months ended June 30, 2016, respectively.

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BUSINESS COMBINATION

6 Months Ended

Jun. 30, 2017

Business Combinations [Abstract]

BUSINESS COMBINATION

4. BUSINESS COMBINATION

On January 31, 2017, United Community completed its acquisition of OLCB pursuant to the terms and conditions of the Agreement and Plan of Merger, dated as of September 8, 2016 by and among United Community, the Bank, OLCB and Premier Bank & Trust (Merger Agreement).  Pursuant to the terms of the Merger Agreement, OLCB was merged with and into United Community. Immediately following the merger, Home Savings was merged with and into Premier Bank & Trust, a subsidiary of OLCB, and changed its name to Home Savings Bank.

As a result of the acquisiton and in accordance with the terms of the Merger Agreement, each preferred share of OLCB was deemed to have been converted into OLCB common shares. Each OLCB common share was converted into the right to receive either $18.00 in cash or 2.736 United Community common shares, subject to certain allocation procedures set forth in the Merger Agreement that ensured that 50% of OLCB’s common shares outstanding were converted into United Community common shares and 50% of OLCB’s common shares outstanding were exchanged for the cash consideration. The Company issued cash in lieu of issuing fractional shares.  

After the allocation procedures were applied, the Company issued 3,033,604 United Community common shares and paid $20.4 million to OLCB shareholders as a result of the acquisition.  Acquisition related costs aggregating $5.0 million were included in United Community’s Consolidated Statements of Operations for the six months ended June 30, 2017.  The fair value of the common shares issued as part of the consideration paid for OLCB was determined in the basis of the closing price of United Community’s commons shares on the acquisition date.

The following table summarizes the consideration paid for OLCB.

	(In thousands)
Cash	$	20,379
United Community shares issued		25,816
Total fair value of consideration paid	$	46,195

At the acquisition date, United Community added the following to the Company’s consolidated statements of financial position:

	(In thousands)
Cash	$	46,159
Loans		259,373
Available for sale securities		9,996
FHLB stock, at cost		1,256
Premises and equipment		2,940
Accrued interest		679
Other intangible assets		2,426
Other real estate owned		89
Other assets		7,988
Total assets acquired	$	330,906
Deposits assumed	$	266,279
Federal Home Loan Bank advances		23,500
Repurchase agreements and other borrowings		10,771
Accrued expenses and other liabilities		2,581
Total liabilities assumed	$	303,131
Goodwill created	$	18,420

The fair value of net assets acquired included fair value adjustments to certain receivables that were not considered impaired as of the acquisition date.  The fair value adjustments were determined using discounted contractual cash flows.  However, the Company believes that all contractual cash flows related to these financial instruments will be collected.  As such, these receivables were not considered impaired at the acquisition date and were not subject to the guidance relating to purchased credit impaired loans, which have shown evidence of credit deterioration since origination.  Receivables acquired that were not subject to these requirements include impaired loans and customer receivables with a fair value and gross contractual amounts receivable of $2.5 million and $2.6 million, respectively, on the date of acquisition.

Upon adoption of ASU 2016-16, Business Combinations (Topic 805), adjustments to provisional amounts booked in previous years are to be adjusted through current year goodwill with the full effect of changes to depreciation, amortization, or other income recorded in current year earnings as if the change had been completed as of the acquisition date.

The following table presents proforma information as if the OLCB acquisition had occurred at the beginning of 2016.  The proforma information includes adjustments for interest income on loans and securities acquired, amortization of intangibles arising from the transaction, depreciation expense on property acquired, interest expense on deposits acquired, and the related income tax effects.  The proforma financial information is not necessarily indicative of the results of operations that would have occurred had the transaction been effected on the assumed dates.  Net income includes the recognition of $4.1 million in acquisiton related expenses incurred by United Community and $368,000 in acquisiton related expenses for OLCB during the six months ended June 30, 2017.  

	For the Six Months Ended June 30,
	2017		2016
	(In thousands, except per share data)
Net interest income	$	39,992	$	36,251
Net income		9,371		10,270
Basic earnings per share	$	0.19	$	0.20
Diluted earnings per share	$	0.19	$	0.20

Goodwill is recorded arising from the acquisition, which consisted largely of synergies and the cost savings resulting from combining the operations of the companies.  No goodwill is expected to be deductible for income tax purposes.  

At the time of the closing, Home Savings charter changed to a state chartered commercial bank and United Community became a financial holding company.

The acquisition benefits the Company and its shareholders by enabling the Company to further expand into the markets currently served by OLCB and strengthening the competitive position of the combined organization. Furthermore, the Company believes its increased asset size after the acquisition will create additional economies of scale and provide opportunities for asset and earnings growth in an extremely competitive banking environment.  OLCB results of operations were included in the Company’s results beginning January 31, 2017.

The fair value of $2.2 million of intangible assets related to core deposits is subject to change pending final receipt of the final valuation.  

On February 28, 2017, HSB Insurance, LLC completed the purchase of an insurance agency engaged in the business of selling insurance including auto, commercial, homeowners and life-health insurance.  Under the purchase agreement, the Company paid $535,000.  $107,000 was paid in cash at closing and the remaining $428,000 will be paid in four equal installments in connection with this acquisition.  Total assets purchased were $535,000, which is the customer list intangible.

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SECURITIES

6 Months Ended

Jun. 30, 2017

Investments Debt And Equity Securities [Abstract]

SECURITIES

5. SECURITIES

Components of the available for sale portfolio are as follows:

	June 30, 2017
			Gross		Gross
	Amortized		unrealized		unrealized			Fair
	cost		gains		losses			value
	(Dollars in thousands)
Available for Sale
U.S. Treasury and government sponsored entities' securities	$	134,820	$	273	$	(490	)	$	134,603
States of the U.S. and political subdivisions		59,112		387		(675	)		58,824
Mortgage-backed GSE securities: residential		94,173		91		(512	)		93,752
Total	$	288,105	$	751	$	(1,677	)	$	287,179

	December 31, 2016
			Gross		Gross
	Amortized		unrealized		unrealized			Fair
	cost		gains		losses			value
	(Dollars in thousands)
Available for Sale
U.S. Treasury and government sponsored entities' securities	$	188,082	$	172	$	(2,221	)	$	186,033
States of the U.S. and political subdivisions		59,415		3		(1,661	)		57,757
Mortgage-backed GSE securities: residential		100,602		50		(1,158	)		99,494
Total	$	348,099	$	225	$	(5,040	)	$	343,284

Components of held to maturity securities portfolio are as follows:

	June 30, 2017
			Gross		Gross
	Amortized		unrecognized		unrecognized			Fair
	cost		gains		losses			value
	(Dollars in thousands)
Held to maturity
Mortgage-backed GSE securities: residential	$	79,318	$	—	$	(892	)	$	78,426
States of the U.S. and political subdivisions		9,241		109		(1	)		9,349
Total	$	88,559	$	109	$	(893	)	$	87,775

	December 31, 2016
			Gross		Gross
	Amortized		unrecognized		unrecognized			Fair
	cost		gains		losses			value
	(Dollars in thousands)
Held to maturity
Mortgage-backed GSE securities: residential	$	85,065	$	—	$	(1,300	)	$	83,765
States of the U.S. and political subdivisions		12,454		17		(86	)		12,385
Total	$	97,519	$	17	$	(1,386	)	$	96,150

Debt securities available for sale by contractual maturity, repricing or expected call date are shown below:

	June 30, 2017
	Amortized cost		Fair value
	(Dollars in thousands)
Due in one year or less	$	—	$	—
Due after one year through five years		4,594		4,579
Due after five years through ten years		130,641		130,447
Due after ten years		58,697		58,401
Mortgage-backed GSE securities: residential		94,173		93,752
Total	$	288,105	$	287,179

Debt securities held to maturity by contractual maturity, repricing or expected call date are shown below:

	June 30, 2017
	Amortized cost		Fair value
	(Dollars in thousands)
Due in one year or less	$	—	$	—
Due after one year through five years		—		—
Due after five years through ten years		7,290		7,375
Due after ten years		1,951		1,974
Mortgage-backed GSE securities: residential		79,318		78,426
Total	$	88,559	$	87,775

Securities pledged for public funds were approximately $136.8 million at June 30, 2017 and approximately $146.5 million at December 31, 2016.  

Securities available for sale that have been in an unrealized loss position for less than twelve months or twelve months or more at June 30, 2017 are as follows:

	June 30, 2017
	Less than 12 months					12 months or more				Total
	Fair		Unrealized loss			Fair		Unrealized		Fair		Unrealized
	value		Loss			value		Loss		value		Loss
	(Dollars in thousands)
Description of securities:
U.S. Treasury and government sponsored entities	$	74,259	$	(490	)	$	—	$	—	$	74,259	$	(490	)
States of the U.S. and political subdivisions		37,694		(675	)		—		—		37,694		(675	)
Mortgage-backed GSE securities: residential		71,176		(512	)		—		—		71,176		(512	)
Total temporarily impaired securities	$	183,129	$	(1,677	)	$	—	$	—	$	183,129	$	(1,677	)

Securities available for sale that have been in an unrealized loss position for less than twelve months or twelve months or more at December 31, 2016 are as follows:

	December 31, 2016
	Less than 12 months					12 months or more				Total
	Fair		Unrealized loss			Fair		Unrealized		Fair		Unrealized
	value		Loss			value		Loss		value		Loss
	(Dollars in thousands)
Description of securities:
U.S. Treasury and government sponsored entities	$	171,411	$	(2,221	)	$	—	$	—	$	171,411	$	(2,221	)
States of the U.S. and political subdivisions		53,283		(1,661	)		—		—		53,283		(1,661	)
Mortgage-backed GSE securities: residential		98,775		(1,158	)		—		—		98,775		(1,158	)
Total temporarily impaired securities	$	323,469	$	(5,040	)	$	—	$	—	$	323,469	$	(5,040	)

All of the U.S. treasury and government sponsored entities and mortgage-backed securities available for sale that were temporarily impaired at June 30, 2017 and December 31, 2016, were impaired due to the level of interest rates at the time of purchase compared to current interest rates. Unrealized losses on these securities have not been recognized into income during the six months ended June 30, 2017 or 2016 because the issuer’s securities are of high credit quality (rated AA or higher), it is likely that management will not be required to sell the securities prior to their anticipated recovery, and the decline in fair value is largely due to changes in interest rates and other market conditions. There is risk that longer term rates could rise further resulting in greater unrealized losses.  The Company expects to realize all interest and principal on these securities and has no intent to sell and more than likely will not be required to sell these securities before their anticipated recovery.

All of the obligations of U.S. states and political subdivisions held for sale that were temporarily impaired at June 30, 2017 and December 31, 2016, were impaired due to the level of interest rates at the time of purchase compared to current interest rates.  Unrealized losses on these securities have not been recognized into income for the six months ended June 30, 2017 or 2016 because the issuer’s securities are of high credit quality (rated AA or higher), it is likely that management will not be required to sell and has no intent to sell the securities prior to their anticipated recovery, and the decline in fair value is largely due to changes in interest rates and other market conditions.

Securities held to maturity that have been in an unrecognized loss position for less than twelve months or twelve months or more are as follows:

	June 30, 2017
	Less than 12 months					12 months or more					Total
	Fair		Unrealized loss			Fair		Unrealized			Fair		Unrealized
	value		Loss			value		Loss			value		Loss
	(Dollars in thousands)
Description of securities:
Mortgage-backed GSE securities: residential	$	53,519	$	(934	)	$	24,907	$	(1,089	)	$	78,426	$	(2,023	)
States of the U.S. and political subdivisions		962		(1	)		—		—			962		(1	)
Total temporarily impaired securities	$	54,481	$	(935	)	$	24,907	$	(1,089	)	$	79,388	$	(2,024	)
	December 31, 2016
	Less than 12 months					12 months or more					Total
	Fair		Unrealized loss			Fair		Unrealized			Fair		Unrealized
	value		Loss			value		Loss			value		Loss
	(Dollars in thousands)
Description of securities:
Mortgage-backed GSE securities: residential	$	57,340	$	(1,243	)	$	26,426	$	(1,287	)	$	83,766	$	(2,530	)
States of the U.S. and political subdivisions		7,416		(86	)							7,416		(86	)
Total temporarily impaired securities	$	64,756	$	(1,329	)	$	26,426	$	(1,287	)	$	91,182	$	(2,616	)

During the third quarter of 2015, Home Savings transferred securities with a total amortized cost of $105.3 million with a corresponding fair value of $103.8 million from available for sale to held to maturity.  The net unrealizable loss, net of taxes, on these securities at the date of transfer was $999,000.  The fair value at the date of transfer becomes the securities’ new cost basis.  The unrealized holding loss at the time of transfer continues to be reported in accumulated other comprehensive income, net of tax and is amortized  over the remaining lives of the securities as an adjustment of the yield.  The amortization of the unamortized holding loss reported in accumulated other comprehensive income will directly offset the effect on interest income from the accretion of the reduced amortized cost for the transferred securities.  Because of this transfer, the total losses less than 12 months and greater than 12 months reported in the table above will not agree to the unrealized losses reported in the inventory of held to maturity securities.  The inventory table reports unrealized gains and losses based upon the transferred securities adjusted cost basis and current fair value.  The reporting of losses less than 12 months and greater than 12 months represents that actual period of time that these securities have been in an unrealized loss position and the securities amortized cost basis as if the transfer did not occur.

All of the mortgage-backed securities held to maturity that were temporarily impaired at June 30, 2017 and December 31, 2016, were impaired due to the level of interest rates at the time of purchase compared to current interest rates. Unrealized losses on these securities have not been recognized into income for the six months ended June 30, 2017 or 2016 because the issuer’s securities are of high credit quality (rated AA or higher), it is likely that management will not be required to sell the securities prior to their anticipated recovery, and the decline in fair value is largely due to changes in interest rates and other market conditions. There is risk that longer term rates could rise further resulting in greater unrealized losses.  The Company expects to realize all interest and principal on these securities and has no intent to sell and more than likely will not be required to sell these securities before their anticipated recovery.

All of the obligations of U.S. states and political subdivisions held to maturity that were temporarily impaired at June 30, 2017 and December 31, 2016, were impaired due to the level of interest rates at the time of purchase compared to current interest rates.  Unrealized losses on these securities have not been recognized into income for the six months ended June 30, 2017 or because the issuer’s securities are of high credit quality (rated AA or higher), it is likely that management will not be required to sell and has no intent to sell the securities prior to their anticipated recovery, and the decline in fair value is largely due to changes in interest rates and other market conditions.

Proceeds from the sale of available for sale securities were $48.1 million and $10.4 million, for the three months ended June 30, 2017 and 2016, respectively.  Gross gains of $345,000 and $233,000 were realized on these sales during the three months ended June 30, 2017 and 2016, respectively.  Gross losses of $44,000 and $0 were realized on these sales during the three months ended June 30, 2017 and 2016, respectively.  Income tax expense related to net realized gains and losses was $105,000 and $81,000 for the three months ended June 30, 2017 and 2016, respectively.

Proceeds from the sale of available for sale securities were $53.2 million and $28.5 million, for the six months ended June 30, 2017 and 2016, respectively.  Gross gains of $374,000 and $386,000 were realized on these sales during the six months ended June 30 2017 and 2016, respectively.  Gross losses of $44,000 and $0 were realized on these sales during the six months ended June 30, 2017 and 2016, respectively.  Income tax expense related to net realized gains and losses was $115,000 and $135,000 for the six months ended June 30, 2017 and 2016, respectively.

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LOANS

6 Months Ended

Jun. 30, 2017

Receivables [Abstract]

LOANS

6. LOANS

Portfolio loans consist of the following:

	June 30,			December 31,
	2017			2016
	(Dollars in thousands)
Commercial loans
Multifamily	$	121,565		$	93,597
Nonresidential		342,300			231,401
Land		10,867			8,373
Construction		96,765			68,158
Secured		162,109			95,343
Unsecured		8,649			7,386
Total commercial loans		742,255			504,258
Residential mortgage loans
One-to four-family		834,349			762,926
Construction		56,946			35,695
Total residential mortgage loans		891,295			798,621
Consumer loans
Home equity		187,762			165,054
Auto		50,389			39,609
Marine		1,601			1,796
Recreational vehicle		6,401			7,602
Other		4,998			2,537
Total consumer loans		251,151			216,598
Total loans		1,884,701			1,519,477
Less:
Allowance for loan losses		19,660			19,087
Deferred loan costs, net		(4,054	)		(3,187	)
Total		15,606			15,900
Loans, net	$	1,869,095		$	1,503,577

The following tables present the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and are based on impairment method as of June 30, 2017 and December 31, 2016 and activity for the three and six months ended June 30, 2017 and 2016.

Allowance For Loan Losses

	Commercial Loans			Residential Loans			Consumer Loans			Total
	(Dollars in thousands)
For the three months ended June 30, 2017
Beginning balance	$	10,182		$	5,912		$	2,876		$	18,970
Provision		503			295			44			842
Charge-offs		(12	)		(273	)		(150	)		(435	)
Recoveries		148			34			101			283
Ending balance	$	10,821		$	5,968		$	2,871		$	19,660
For the six months ended June 30, 2017
Beginning balance	$	10,824		$	5,538		$	2,725		$	19,087
Provision (recovery)		1,025			865			427			2,317
Charge-offs		(1,323	)		(503	)		(479	)		(2,305	)
Recoveries		295			68			198			561
Ending balance	$	10,821		$	5,968		$	2,871		$	19,660
June 30, 2017
Period-end amount allocated to:
Loans individually evaluated for impairment	$	5		$	1,171		$	440			1,616
Loans collectively evaluated for impairment		10,816			4,797			2,431			18,044
Loans acquired with deteriorated credit quality		—			—			—			—
Ending balance	$	10,821		$	5,968		$	2,871		$	19,660
Period-end balances:
Loans individually evaluated for impairment		2,532			16,190			7,588			26,310
Loans collectively evaluated for impairment		738,502			875,105			243,563			1,857,170
Loans acquired with deteriorated credit quality		1,221			—			—			1,221
Ending balance	$	742,255		$	891,295		$	251,151		$	1,884,701

Allowance For Loan Losses

	Commercial Loans			Residential Loans			Consumer Loans			Total
For the three months ended June 30, 2016
Beginning balance	$	8,521		$	5,736		$	2,646		$	16,903
Provision (recovery)		489			(33	)		(61	)		395
Charge-offs		(147	)		(84	)		(276	)		(507	)
Recoveries		95			25			261			381
Ending balance	$	8,958		$	5,644		$	2,570		$	17,172
For the six months ended June 30, 2016
Beginning balance	$	8,077		$	6,630		$	3,005		$	17,712
Provision (recovery)		3,213			(627	)		(36	)		2,550
Charge-offs		(2,493	)		(446	)		(755	)		(3,694	)
Recoveries		161			87			356			604
Ending balance	$	8,958		$	5,644		$	2,570		$	17,172
December 31, 2016
Period-end amount allocated to:
Loans individually evaluated for impairment	$	1,271		$	1,245		$	500		$	3,016
Loans collectively evaluated for impairment		9,553			4,293			2,225			16,071
Ending balance	$	10,824		$	5,538		$	2,725		$	19,087
Period-end balances:
Loans individually evaluated for impairment	$	6,018		$	17,485		$	8,045		$	31,548
Loans collectively evaluated for impairment		498,240			781,136			208,553			1,487,929
Ending balance	$	504,258		$	798,621		$	216,598		$	1,519,477

The allowance for loan losses is a valuation allowance for probable incurred credit losses. Loan losses are charged against the allowance when management believes the uncollectibility of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance. Management estimates the allowance balance required based on an analysis using past loan loss experience, the nature and volume of the portfolio, information about specific borrower situations, estimated collateral values, general economic conditions in the market area and other factors. Allocations of the allowance may be made for specific loans, but the entire allowance is available for any loan that, in management’s judgment, should be charged-off.

Other loans not reviewed specifically by management are evaluated as a homogenous group of loans (generally single-family residential mortgage loans and all consumer credits except marine loans) using a loss factor applied to the outstanding loan balance to determine the level of reserve required. This loss factor consists of two components, a quantitative and a qualitative component. The quantitative component is based on a historical analysis of all charged-off loans, net of recoveries. In determining the qualitative factors, consideration is given to such attributes as lending policies, economic conditions, nature and volume of the portfolio, management, loan quality trend, loan review, collateral value, concentrations, economic cycles and other external factors.  As of June 30, 2017, the Company evaluated 20 quarters of net charge-off history and applied this information to the current period.  This component is combined with the qualitative component to arrive at the loss factor, which is applied to the outstanding balance of homogenous loans.

The following table presents loans individually evaluated for impairment by class of loans as of and for six months ended June 30, 2017:

Impaired Loans

(Dollars in thousands)

	Unpaid Principal Balance		Recorded Investment		Allowance for Loan Losses Allocated		Average Recorded Investment		Interest Income Recognized		Cash Basis Income Recognized
With no specific allowance recorded
Commercial loans
Multifamily	$	470	$	413	$	—	$	277	$	3	$	3
Nonresidential		2,030		1,464		—		1,040		50		49
Land		3,922		9		—		17		—		—
Construction		3,593		—		—		—		—		—
Secured		242		190		—		190		—		—
Unsecured		500		—		—		—		—		—
Total commercial loans		10,757		2,076		—		1,524		53		52
Residential mortgage loans
One-to four-family		7,704		5,762		—		6,095		50		41
Construction		—		—		—		—		—		—
Total residential mortgage loans		7,704		5,762		—		6,095		50		41
Consumer loans
Home equity		1,965		1,535		—		1,577		8		7
Auto		34		18		—		11		—		—
Marine		540		169		—		210		—		—
Recreational vehicle		560		152		—		164		5		5
Other		—		—		—		—		—		—
Total consumer loans		3,099		1,874		—		1,962		13		12
Total	$	21,560	$	9,712	$	—	$	9,581	$	116	$	105
With a specific allowance recorded
Commercial loans
Multifamily	$	—	$	—	$	—	$	—	$	—	$	—
Nonresidential		501		456		5		2,164		12		11
Land		—		—		—		—		—		—
Construction		—		—		—		—		—		—
Secured		—		—		—		57		—		—
Unsecured		—		—		—		—		—		—
Total commercial loans		501		456		5		2,221		12		11
Residential mortgage loans
One-to four-family		10,526		10,428		1,171		10,764		273		229
Construction		—		—		—		—		—		—
Total residential mortgage loans		10,526		10,428		1,171		10,764		273		229
Consumer loans
Home equity		4,973		4,919		377		5,212		151		134
Auto		—		—		—		—		—		—
Marine		104		104		1		106		3		3
Recreational vehicle		702		691		62		681		14		13
Other		—		—		—		—		—		—
Total consumer loans		5,779		5,714		440		5,999		168		150
Total		16,806		16,598		1,616		18,984		453		390
Total impaired loans	$	38,366	$	26,310	$	1,616	$	28,565	$	569	$	495

The following table presents loans individually evaluated for impairment by class of loans as of and for six months ended June 30, 2016:

Impaired Loans

(Dollars in thousands)

	Unpaid Principal Balance		Recorded Investment		Allowance for Loan Losses Allocated		Average Recorded Investment		Interest Income Recognized		Cash Basis Income Recognized
With no specific allowance recorded
Commercial loans
Multifamily	$	95	$	—	$	—	$	—	$	—	$	—
Nonresidential		1,382		326		—		281		3		3
Land		3,922		384		—		384		—		—
Construction		3,594		—		—		—		—		—
Secured		3,745		3,700		—		3,700		—		—
Unsecured		1,118		—		—		—		—		—
Total commercial loans		13,856		4,410		—		4,365		3		3
Residential mortgage loans
One-to four-family		8,102		6,522		—		6,156		52		42
Construction		—		—		—		—		—		—
Total residential mortgage loans		8,102		6,522		—		6,156		52		42
Consumer loans
Home equity		1,858		1,339		—		1,463		4		4
Auto		16		9		—		11		—		—
Marine		544		302		—		292		—		—
Recreational vehicle		518		273		—		213		2		2
Other		4		4		—		3		—		—
Total consumer loans		2,940		1,927		—		1,982		6		6
Total	$	24,898	$	12,859	$	—	$	12,503	$	61	$	51
With a specific allowance recorded
Commercial loans
Multifamily	$	—	$	—	$	—	$	—	$	—	$	—
Nonresidential		10,854		8,571		922		7,493		124		122
Land		—		—		—		—		—		—
Construction		—		—		—		—		—		—
Secured		1,027		933		93		739		—		—
Unsecured		—		—		—		—		—		—
Total commercial loans		11,881		9,504		1,015		8,232		124		122
Residential mortgage loans
One-to four-family		12,033		12,033		1,333		12,742		297		251
Construction		—		—		—		—		—		—
Total residential mortgage loans		12,033		12,033		1,333		12,742		297		251
Consumer loans
Home equity		6,279		6,279		447		6,791		188		167
Auto		—		—		—		—		—		—
Marine		156		156		4		159		4		4
Recreational vehicle		793		793		85		868		15		14
Other		—		—		—		3		—		—
Total consumer loans		7,228		7,228		536		7,821		207		185
Total		31,142		28,765		2,884		28,795		628		558
Total impaired loans	$	56,040	$	41,624	$	2,884	$	41,298	$	689	$	609

The following table presents loans individually evaluated for impairment by class of loans as of December 31, 2016:

Impaired Loans

(Dollars in thousands)

	Unpaid Principal Balance		Recorded Investment		Allowance for Loan Losses Allocated
With no specific allowance recorded
Commercial loans
Multifamily	$	55	$	—	$	—
Nonresidential		2,278		1,489		—
Land		3,922		34		—
Construction		3,594		—		—
Secured		242		190		—
Unsecured		713		—		—
Total commercial loans		10,804		1,713		—
Residential mortgage loans
One-to four-family		8,736		6,758		—
Construction		—		—		—
Total residential mortgage loans		8,736		6,758		—
Consumer loans
Home equity		2,159		1,583		—
Auto		11		3		—
Marine		585		267		—
Recreational vehicle		433		120		—
Other		—		—		—
Total consumer loans		3,188		1,973		—
Total	$	22,728	$	10,444	$	—
With a specific allowance recorded
Commercial loans
Multifamily	$	—	$	—	$	—
Nonresidential		6,930		4,133		1,193
Land		—		—		—
Construction		—		—		—
Secured		237		172		78
Unsecured		—		—		—
Total commercial loans		7,167		4,305		1,271
Residential mortgage loans
One-to four-family		10,810		10,727		1,245
Construction		—		—		—
Total residential mortgage loans		10,810		10,727		1,245
Consumer loans
Home equity		5,390		5,335		426
Auto		—		—		—
Marine		108		108		1
Recreational vehicle		639		629		73
Other		—		—		—
Total consumer loans		6,137		6,072		500
Total		24,114		21,104		3,016
Total impaired loans	$	46,842	$	31,548	$	3,016

The unpaid principal balance is the total amount of the loan that is due to Home Savings. The recorded investment includes the unpaid principal balance less any charge-offs or partial charge-offs applied to specific loans. The unpaid principal balance and the recorded investment both exclude accrued interest receivable and deferred loan costs, both of which are immaterial.

The following table presents loans individually evaluated for impairment by class of loans as of and for the three months ended June 30, 2017:

	Average Recorded Investment		Interest Income Recognized		Cash Basis Income Recognized
With no specific allowance recorded
Commercial loans
Multifamily	$	416	$	—	$	—
Nonresidential		815		25		25
Land		9		—		—
Construction		—		—		—
Secured		190		—		—
Unsecured		—		—		—
Total commercial loans		1,430		25		25
Residential mortgage loans
One-to four-family		5,763		20		20
Construction		—		—		—
Total residential mortgage loans		5,763		20		20
Consumer loans
Home equity		1,574		3		3
Auto		16		—		—
Marine		182		—		—
Recreational vehicle		186		2		2
Other				—		—
Total consumer loans		1,958		5		5
Total	$	9,151	$	50	$	50
With a specific allowance recorded
Commercial loans
Multifamily	$	—	$	—	$	—
Nonresidential		1,179		5		5
Land		—		—		—
Construction		—		—		—
Secured				—		—
Unsecured		—		—		—
Total commercial loans		1,179		5		5
Residential mortgage loans
One-to four-family		10,783		114		111
Construction		—		—		—
Total residential mortgage loans		10,783		114		111
Consumer loans
Home equity		5,151		66		66
Auto		—		—		—
Marine		105		1		1
Recreational vehicle		708		7		6
Other		—		—		—
Total consumer loans		5,964		74		73
Total		17,926		193		189
Total impaired loans	$	27,077	$	243	$	239

The following table presents loans individually evaluated for impairment by class of loans as of and for the three months ended June 30, 2016:

	Average Recorded Investment		Interest Income Recognized		Cash Basis Income Recognized
With no specific allowance recorded
Commercial loans
Multifamily	$	—	$	—	$	—
Nonresidential		269		1		1
Land		384		—
Construction		—		—		—
Secured		3,700		—		—
Unsecured		—		—		—
Total commercial loans		4,353		1		1
Residential mortgage loans
One-to four-family		6,302		17		17
Construction		—		—		—
Total residential mortgage loans		6,302		17		17
Consumer loans
Home equity		1,336		1		1
Auto		9		—		—
Marine		303		—		—
Recreational vehicle		281		1		1
Other		4		—		—
Total consumer loans		1,933		2		2
Total	$	12,588	$	20	$	20
With a specific allowance recorded
Commercial loans
Multifamily	$	—	$	—	$	—
Nonresidential		8,748		15		15
Land		—		—		—
Construction		—		—		—
Secured		947		—		—
Unsecured		—		—		—
Total commercial loans		9,695		15		15
Residential mortgage loans
One-to four-family		12,372		124		122
Construction		—		—		—
Total residential mortgage loans		12,372		124		122
Consumer loans
Home equity		6,568		84		82
Auto		—		—		—
Marine		158		2		2
Recreational vehicle		741		8		8
Other		—		—		—
Total consumer loans		7,467		94		92
Total		29,534		233		229
Total impaired loans	$	42,122	$	253	$	249

Home Savings reclassifies a collateralized mortgage loan and a consumer loan secured by real estate to real estate owned and other repossessed assets once it has either obtained legal title to the real estate collateral or the borrower voluntarily conveys all interest in the real property to the Bank to satisfy the loan through a deed in lieu of foreclosure or similar legal agreement.  The table below presents loans that are in the process of foreclosure at June 30, 2017 and December 31, 2016, but legal title, deed in lieu of foreclosure or similar legal agreement to the property has not yet been obtained:

	June 30, 2017				December 31, 2016
	Unpaid Principal Balance		Recorded Investment		Unpaid Principal Balance		Recorded Investment
	(Dollars in thousands)				(Dollars in thousands)
Mortgage loans in process of foreclosure	$	3,188	$	2,816	$	3,025	$	2,576
Consumer loans in process of foreclosure		931		751		1,069		795

The following table presents the recorded investment in nonaccrual loans and loans past due over 90 days and still on accrual by class of loans as of June 30, 2017:

Nonaccrual Loans and Loans Past Due Over 90 Days and Still Accruing

As of June 30, 2017

	Nonaccrual		Loans past due over 90 days and still accruing
	(Dollars in thousands)
Commercial loans
Multifamily	$	413	$	—
Nonresidential		1,331		—
Land		9		—
Construction		—		—
Secured		190		—
Unsecured		—		—
Total commercial loans		1,943		—
Residential mortgage loans
One-to four-family		6,701		—
Construction		—		—
Total residential mortgage loans		6,701		—
Consumer Loans
Home equity		1,707		—
Auto		94		—
Marine		169		—
Recreational vehicle		166		—
Other		1		2
Total consumer loans		2,137		2
Total nonaccrual loans and loans past due over 90 days and still accruing	$	10,781	$	2

The following table presents the recorded investment in nonaccrual loans and loans past due over 90 days and still on accrual by class of loans as of December 31, 2016:

Nonaccrual Loans and Loans Past Due Over 90 Days and Still Accruing

As of December 31, 2016

	Nonaccrual		Loans past due over 90 days and still accruing
	(Dollars in thousands)
Commercial loans
Multifamily	$	—	$	—
Nonresidential		3,546		—
Land		34		—
Construction		—		—
Secured		361		—
Unsecured		—		—
Total commercial loans		3,941		—
Residential mortgage loans
One-to four-family		6,084		—
Construction		—		—
Total residential mortgage loans		6,084		—
Consumer Loans
Home equity		1,936		—
Auto		31		—
Marine		267		—
Recreational vehicle		178		—
Other		2		—
Total consumer loans		2,414		—
Total nonaccrual loans and loans past due over 90 days and still accruing	$	12,439	$	—

The following table presents an age analysis of past-due loans, segregated by class of loans as of June 30, 2017:

Past Due Loans

(Dollars in thousands)

	30-59 Days Past Due		60-89 Days Past Due		Greater than 90 Days Past Due		Total Past Due		Current Loans		Total Loans
Commercial loans
Multifamily	$	—	$	187	$	—	$	187	$	121,378	$	121,565
Nonresidential		199		—		153		352		341,948		342,300
Land		—		—		9		9		10,858		10,867
Construction		—		—		—		—		96,765		96,765
Secured		135		22		189		346		161,763		162,109
Unsecured		—		—		—		—		8,649		8,649
Total commercial loans		334		209		351		894		741,361		742,255
Residential mortgage loans
One-to four-family		2,643		1,584		5,646		9,873		824,476		834,349
Construction		—		—		—		—		56,946		56,946
Total residential mortgage loans		2,643		1,584		5,646		9,873		881,422		891,295
Consumer Loans:
Home equity		1,141		113		1,429		2,683		185,079		187,762
Automobile		123		119		17		259		50,130		50,389
Marine		—		—		169		169		1,432		1,601
Recreational vehicle		199		149		95		443		5,958		6,401
Other		2		4		3		9		4,989		4,998
Total consumer loans		1,465		385		1,713		3,563		247,588		251,151
Total loans	$	4,442	$	2,178	$	7,710	$	14,330	$	1,870,371	$	1,884,701

The following table presents an age analysis of past-due loans, segregated by class of loans as of December 31, 2016:

Past Due Loans

(Dollars in thousands)

	30-59 Days Past Due		60-89 Days Past Due		Greater than 90 Days Past Due		Total Past Due		Current Loans		Total Loans
Commercial loans
Multifamily	$	—	$	—	$	—	$	—	$	93,597	$	93,597
Nonresidential		3,511		—		61		3,572		227,829		231,401
Land		—		—		34		34		8,339		8,373
Construction		—		—		—		—		68,158		68,158
Secured		—		—		361		361		94,982		95,343
Unsecured		—		—		—		—		7,386		7,386
Total commercial loans		3,511		—		456		3,967		500,291		504,258
Residential mortgage loans
One-to four-family		3,774		1,717		5,461		10,952		751,974		762,926
Construction		—		—		—		—		35,695		35,695
Total residential mortgage loans		3,774		1,717		5,461		10,952		787,669		798,621
Consumer Loans:
Home equity		941		458		1,669		3,068		161,986		165,054
Automobile		130		—		3		133		39,476		39,609
Marine		—		—		267		267		1,529		1,796
Recreational vehicle		131		347		—		478		7,124		7,602
Other		1		3		2		6		2,531		2,537
Total consumer loans		1,203		808		1,941		3,952		212,646		216,598
Total loans	$	8,488	$	2,525	$	7,858	$	18,871	$	1,500,606	$	1,519,477

As of June 30, 2017 and December 31, 2016, the Company has a recorded investment in troubled debt restructurings of $22.2 million and $26.6 million, respectively.  The Company allocated $1.6 million of specific allowance for those loans at June 30, 2017 and $3.0 million at December 31, 2016.  The Company has committed to lend additional amounts totaling up to $35,000 and $31,000 at June 30, 2017 and December 31, 2016, respectively.  

There were no loans modified as troubled debt restructurings that occurred during the three months ended June 30, 2017.

The troubled debt restructurings described above had no effect on the allowance for loan losses and resulted in no charge-offs during the three months ended June 30, 2017.

The following table presents loans by class modified as troubled debt restructurings that occurred during the six months ended June 30, 2017:

	Number of Loans		Pre-Modification Outstanding Recorded Investment		Post-Modification Recorded Investment
			(In thousands)
Commercial loans
Multifamily		—	$	—	$	—
Nonresidential
Land		—		—		—
Construction		—		—		—
Secured		—		—		—
Unsecured		—		—		—
Total commercial loans		—		—		—
Residential mortgage loans
One-to four-family		1		75		84
Construction		—		—		—
Total residential mortgage loans		1		75		84
Consumer loans
Home equity		—		—		—
Auto		—		—		—
Marine		—		—		—
Recreational vehicle		1		115		115
Other		—		—		—
Total consumer loans		1		115		115
Total restructured loans		2	$	190	$	199

The troubled debt restructurings described above increased the allowance for loan losses by $6,000 and resulted in no charge-offs during the six months ended June 30, 2017.

The following table presents loans by class modified as troubled debt restructurings that occurred during the three months ended June 30, 2016:

	Number of Loans		Pre-Modification Outstanding Recorded Investment		Post-Modification Recorded Investment
			(Dollars in thousands)
Commercial loans
Multifamily		—	$	—	$	—
Nonresidential		1		4,000		4,000
Land		—		—		—
Construction		—		—		—
Secured		—		—		—
Unsecured		—		—		—
Total commercial loans		1		4,000		4,000
Residential mortgage loans
One-to four-family		1		97		98
Construction		—		—		—
Total residential mortgage loans		1		97		98
Consumer loans
Home equity		2		110		114
Auto		—		—		—
Marine		—		—		—
Recreational vehicle		—		—		—
Other		—		—		—
Total consumer loans		2		110		114
Total restructured loans		4	$	4,207	$	4,212

The troubled debt restructurings described above increased the allowance for loan losses by $6,000, and resulted in no charge-offs during the three months ended June 30, 2016.

The following table presents loans by class modified as troubled debt restructurings that occurred during the six months ended June 30, 2016:

	Number of Loans		Pre-Modification Outstanding Recorded Investment		Post-Modification Recorded Investment
			(Dollars in thousands)
Commercial loans
Multifamily		—	$	—	$	—
Nonresidential		2		4,088		4,088
Land		—		—		—
Construction		—		—		—
Secured		—		—		—
Unsecured		—		—		—
Total commercial loans		2		4,088		4,088
Residential mortgage loans
One-to four-family		3		316		335
Construction		—		—		—
Total residential mortgage loans		3		316		335
Consumer loans
Home equity		3		130		134
Auto		—		—		—
Marine		—		—		—
Recreational vehicle		—		—		—
Other		—		—		—
Total consumer loans		3		130		134
Total restructured loans		8	$	4,534	$	4,557

The troubled debt restructurings described above increased the allowance for loan losses by $11,000 and resulted in no charge-offs during the six months ended June 30, 2017.

The following table presents loans by class modified as troubled debt restructurings for which there was a payment default within a twelve-month cycle following the modification during the period ended June 30, 2017.

	Number of loans		Recorded Investment
			(Dollars in thousands)
Commercial loans
Multifamily		—	$	—
Nonresidential		—		—
Land		—		—
Construction		—		—
Secured		—		—
Unsecured		—		—
Total commercial loans		—		—
Residential mortgage loans
One-to four-family		1		164
Construction		—		—
Total residential mortgage loans		1		164
Consumer loans
Home equity		1		47
Auto		—		—
Marine		—		—
Recreational vehicle		—		—
Other		—		—
Total consumer loans		1		47
Total restructured loans		2	$	211

The troubled debt restructurings that subsequently defaulted described above resulted in no charge-offs during the three and six months ended June 30, 2017, and had no effect on the provision for loan losses.

The following table presents loans by class modified as troubled debt restructurings for which there was a payment default within a twelve month cycle following the modification during the period ended June 30, 2016:

	Number of loans		Recorded Investment
			(Dollars in thousands)
Commercial loans
Multifamily		—	$	—
Nonresidential		—		—
Land		—		—
Construction		—		—
Secured		—		—
Unsecured		—		—
Total commercial loans		—		—
Residential mortgage loans
One-to four-family		—		—
Construction		—		—
Total residential mortgage loans		—		—
Consumer loans
Home equity		—		—
Auto		—		—
Marine		—		—
Recreational vehicle		—		—
Other		—		—
Total consumer loans		—		—
Total restructured loans		—	$	—

The troubled debt restructurings that subsequently defaulted described above resulted in no of charge-offs during the three and six months ended June 30, 2016, and had no effect on the provision for loan losses.

A troubled debt restructuring is considered to be in payment default once it is 30 days contractually past due under the modified terms.

In order to determine whether a borrower is experiencing financial difficulty, an evaluation is performed of the probability that the borrower will be in payment default on any of its debt in the foreseeable future without the modification. This evaluation is performed in accordance with the Company’s internal underwriting policy.

Credit Quality Indicators:

The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt, such as: current financial information, historical payment experience, credit documentation, public information and current economic trends. The Company analyzes loans individually by classifying the loans as to credit risk. This analysis includes homogeneous loans past due 90 cumulative days, and all non-homogeneous loans, including commercial loans and commercial real estate loans. Smaller balance homogeneous loans are primarily monitored by payment status.

Asset quality ratings are divided into two groups: Pass (unclassified) and Classified. Within the unclassified group, certain loans that display potential weakness are risk rated as special mention. In addition, there are three classified risk ratings: substandard, doubtful and loss. These specific credit risk categories are defined as follows:

Special Mention. Loans classified as special mention have potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.

Substandard. Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

Doubtful. Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable.

Loss. Loans classified as loss are considered uncollectible and of such little value, that continuance as assets is not warranted. Although there may be a chance of recovery on these assets, it is not practical or desirable to defer writing off the asset.

The Company monitors loans on a monthly basis to determine if they should be included in one of the categories listed above. All impaired non-homogeneous credits classified as substandard, doubtful or loss are analyzed on an individual basis for a specific reserve requirement. This analysis is performed on each individual credit at least annually or more frequently if warranted.

As of June 30, 2017 and December 31, 2016, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:

Loans

June 30, 2017

(Dollars in thousands)

	Unclassified				Classified
	Unclassified		Special Mention		Substandard		Doubtful		Loss		Total Classified		Total Loans
Commercial Loans
Multifamily	$	117,375	$	3,482	$	708	$	—	$	—	$	708	$	121,565
Nonresidential		333,010		3,208		6,082		—		—		6,082		342,300
Land		10,858		—		9		—		—		9		10,867
Construction		96,362		403		—		—		—		—		96,765
Secured		134,433		10,839		16,837		—		—		16,837		162,109
Unsecured		8,555		—		94		—		—		94		8,649
Total commercial loans		700,593		17,932		23,730		—		—		23,730		742,255
Residential mortgage loans
One-to four-family		825,270		779		8,300		—		—		8,300		834,349
Construction		56,946		—		—		—		—		—		56,946
Total residential mortgage loans		882,216		779		8,300		—		—		8,300		891,295
Consumer Loans
Home equity		186,055		—		1,707		—		—		1,707		187,762
Auto		50,258		—		131		—		—		131		50,389
Marine		1,432		—		169		—		—		169		1,601
Recreational vehicle		6,234		—		167		—		—		167		6,401
Other		4,997		—		1		—		—		1		4,998
Total consumer loans		248,976		—		2,175		—		—		2,175		251,151
Total loans	$	1,831,785	$	18,711	$	34,205	$	—	$	—	$	34,205	$	1,884,701

Loans

December 31, 2016

(Dollars in thousands)

	Unclassified				Classified
	Unclassified		Special Mention		Substandard		Doubtful		Loss		Total Classified		Total Loans
Commercial Loans
Multifamily	$	89,468	$	3,564	$	565	$	—	$	—	$	565	$	93,597
Nonresidential		217,204		6,037		8,160		—		—		8,160		231,401
Land		8,339		—		34		—		—		34		8,373
Construction		68,158		—		—		—		—		—		68,158
Secured		89,756		3,420		2,167		—		—		2,167		95,343
Unsecured		7,291		—		95		—		—		95		7,386
Total commercial loans		480,216		13,021		11,021		—		—		11,021		504,258
Residential mortgage loans
One-to four-family		754,996		104		7,826		—		—		7,826		762,926
Construction		35,695		—		—		—		—		—		35,695
Total residential mortgage loans		790,691		104		7,826		—		—		7,826		798,621
Consumer Loans
Home equity		163,101		—		1,953		—		—		1,953		165,054
Auto		39,577		1		31		—		—		31		39,609
Marine		1,530		—		266		—		—		266		1,796
Recreational vehicle		7,424		—		178		—		—		178		7,602
Other		2,535		—		2		—		—		2		2,537
Total consumer loans		214,167		1		2,430		—		—		2,430		216,598
Total loans	$	1,485,074	$	13,126	$	21,277	$	—	$	—	$	21,277	$	1,519,477

Purchased Credit Impaired Loans:

The Company has purchased loans, for which there was, at acquisition, evidence of deterioration of credit quality since origination and it was probable, at acquisition, that all contractually required payments would not be collected.  The carrying amount of those loans is as follows:

	June 30, 2017
	(Dollars in thousands)
Commercial loans	$	1,221
Residential mortgage loans		—
Consumer loans		—
Outstanding balance	$	1,221
Carrying amount, net of allowance of $0	$	1,221

Accretable yield, or income expected to be collected, is as follows:

	Three Months Ended		Six Months Ended
	June 30, 2017		June 30, 2017
			(Dollars in thousands)
Beginning of period	$	128	$	—
New loans purchased		—		158
Accretion of income		12		42
Balance at June 30	$	116	$	116

For the purchased credit impaired loans disclosed above, there was no change in the allowance for loan losses for the three and six months ended June 30, 2017.  

Purchased credit impaired loans purchased during the six months ended June 30, 2017 for which it was probable at acquisition that all contractually required payments would not be collected are as follows:

	June 30, 2017
	(Dollars in thousands)
Contractually required payments receivable of   loans purchased during the year:
Commercial loans	$	4,499
Residential mortgage loans		—
Consumer loans		—
	$	4,499
Cash flow expected to be collected at acquisition	$	1,955
Fair value of acquired loans at acquisition		1,797

Income is not recognized on purchased credit impaired loans if the Company cannot reasonably estimate cash flows expected to be collected.  The carrying amounts of such loans are as follows:

	June 30, 2017
	(Dollars in thousands)
Loans at beginning of year	$	—
Loans purchased during the year		1,797
Loans at end of period		1,221

XML

MORTGAGE BANKING ACTIVITIES

6 Months Ended

Jun. 30, 2017

Mortgage Banking [Abstract]

MORTGAGE BANKING ACTIVITIES

7. MORTGAGE BANKING ACTIVITIES

Mortgage loans serviced for others, which are not reported in United Community’s assets, totaled $1.2 billion as of June 30, 2017 and $1.2 billion as of December 31, 2016. Mortgage banking income is comprised of gains recognized on the sale of loans and changes in fair value of mortgage banking derivatives.

The principal balances of mortgage loans serviced for others are as follows:

	June 30, 2017		December 31, 2016
	(Dollars in thousands)
Mortgage loan portfolios serviced for:
FHLMC	$	963,748	$	956,278
FNMA		213,848		208,114
Private investor		27,917		—

During the second quarter of 2017, the Company sold $27.9 million of adjustable rate 1-4 family mortgages to a private investor in a bulk mortgage loan sale.  The Company recognized 45 basis points of mortgage service release premium as part of the gain recognized on this sale.   Customer escrow balances with loans serviced for FHLMC, FNMA and the private investor totaled $12.1 million and $14.3 million at June 30, 2017 and December 31, 2016, respectively.

Activity for capitalized mortgage servicing rights, included in other assets, was as follows:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2017			2016			2017			2016
	(Dollars in thousands)
Balance, beginning of period	$	5,977		$	5,727		$	6,070		$	5,686
Originations		670			653			1,026			1,162
Amortized to expense		(486	)		(567	)		(935	)		(1,035	)
Balance, end of period		6,161			5,813			6,161			5,813
Less valuation allowance		(5	)		(766	)		(5	)		(766	)
Net balance	$	6,156		$	5,047		$	6,156		$	5,047

Activity in the valuation allowance for mortgage servicing rights was as follows:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2017			2016			2017			2016
	(Dollars in thousands)
Balance, beginning of period	$	(3	)	$	(474	)	$	—		$	(39	)
Impairment charges		(2	)		(292	)		(5	)		(727	)
Recoveries		—			—			—			—
Balance, end of period	$	(5	)	$	(766	)	$	(5	)	$	(766	)

The fair value of mortgage servicing rights as of June 30, 2017, was approximately $10.3 million and at December 31, 2016, the fair value was approximately $10.2 million.

Key economic assumptions in measuring the value of mortgage servicing rights at June 30, 2017, and December 31, 2016, were as follows:

	June 30, 2017		December 31, 2016
Weighted average prepayment rate	178 PSA		165 PSA
Weighted average life (in years)	6.38		6.64
Weighted average discount rate		9.06%		9.00%

XML

OTHER REAL ESTATE OWNED AND OTHER REPOSSESSED ASSETS

6 Months Ended

Jun. 30, 2017

Real Estate [Abstract]

OTHER REAL ESTATE OWNED AND OTHER REPOSSESSED ASSETS

8. OTHER REAL ESTATE OWNED AND OTHER REPOSSESSED ASSETS

Real estate owned and other repossessed assets at June 30, 2017 and December 31, 2016 were as follows:

	June 30, 2017			December 31, 2016
	(Dollars in thousands)
Real estate owned and other repossessed assets	$	1,586		$	2,789
Valuation allowance		(389	)		(1,012	)
End of period	$	1,197		$	1,777

Activity in the valuation allowance was as follows:

	Three Months Ended						Six Months Ended
	June 30, 2017			June 30, 2016			June 30, 2017			June 30, 2016
	(Dollars in thousands)
Beginning of period	$	549		$	1,124		$	1,012		$	1,229
Recovery of expense		—			(27	)		(38	)		(26	)
Reductions due to sales		(160	)		(96	)		(585	)		(202	)
End of period	$	389		$	1,001		$	389		$	1,001

Expenses related to foreclosed and repossessed assets include:

	Three Months Ended					Six Months Ended
	June 30, 2017		June 30, 2016			June 30, 2017			June 30, 2016
	(Dollars in thousands)
Net loss on sales	$	18	$	90		$	108		$	102
Provision for unrealized (gains) losses , net		—		(27	)		(38	)		(26	)
Operating expenses, net of rental income		23		77			85			149
Total expenses	$	41	$	140		$	155		$	225

XML

FAIR VALUE MEASUREMENT

6 Months Ended

Jun. 30, 2017

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENT

9. FAIR VALUE MEASUREMENT

Fair value is the exchange price that would be received for an asset if paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There are three levels of inputs that may be used to measure fair value:

Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level 2: Significant other observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3: Significant unobservable inputs that reflect a reporting entity’s own beliefs about the assumptions that market participants would use in pricing an asset or liability.

United Community uses the following methods and significant assumptions to estimate the fair value of each type of financial instrument:

Available for sale securities: The fair values of securities available for sale are determined by obtaining quoted prices on nationally recognized securities exchanges (Level 1 inputs). For securities where quoted prices are not available, fair values are calculated based on market prices of similar securities (Level 2), using matrix pricing.  Matrix pricing is a mathematical technique commonly used to price debt securities that are not actively traded, values debt securities without relying on the securities’ relationship to other benchmark quoted securities (Level 2 inputs).

Impaired loans: At the time a loan is considered impaired, it is valued at the lower of cost or fair value. Impaired loans carried at fair value generally receive specific allocations of the allowance for loan losses. For collateral dependent loans, fair value is commonly based on recent real estate appraisals. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are usually significant and typically result in a Level 3 classification of the inputs for determining fair value. Non-real estate collateral may be valued using an appraisal, net book value per the borrower’s financial statements, or aging reports, adjusted or discounted based on management’s historical knowledge, changes in market conditions from the time of the valuation, and management’s expertise and knowledge of the client and client’s business, resulting in a Level 3 fair value classification. Impaired loans are evaluated on a quarterly basis for additional impairment and adjusted accordingly.

Other real estate owned: Assets acquired through or instead of loan foreclosure are initially recorded at fair value less costs to sell when acquired, establishing a new cost basis. These assets are subsequently accounted for at lower of cost or fair value less estimated costs to sell. Fair value is commonly based on recent real estate appraisals. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are usually significant and typically result in a Level 3 classification of the inputs for determining fair value. Real estate owned properties are individually evaluated at least annually for additional impairment and adjusted accordingly.

Appraisals for both collateral-dependent impaired loans and other real estate owned are performed by certified general appraisers (for commercial properties) or certified residential appraisers (for residential properties) whose qualifications and licenses have been reviewed and verified by Home Savings. Once received, a member of the Special Assets Department reviews the assumptions and approaches utilized in the appraisal as well as the overall resulting fair value in comparison with the independent data sources such as recent market data or industry-wide statistics. In addition to the Special Assets Department review, a third party independent review is also performed.  On an annual basis, Home Savings compares the actual selling price of collateral that has been sold to the most recent appraised value to determine what additional adjustment should be made to the appraisal value to arrive at fair value. At the time a property is acquired and classified as real estate owned, the fair value is determined utilizing the most appropriate method. A fair value in excess of $250,000 will be supported by an appraisal. After determination of fair value, each property will be recorded at the lower of cost (i.e., recorded investment in the loan) or the estimated net realizable value on the date of transfer to real estate owned. In determining net realizable value, reductions to fair market value may be taken for estimated costs of sale, conditions that must be remedied immediately upon acquisition, and other factors that negatively impact the marketability and prompt sale of the property.

Mortgage servicing rights: On a quarterly basis, loan servicing rights are evaluated for impairment based upon the fair value of the rights as compared to carrying amount. If the carrying amount of an individual tranche exceeds fair value, impairment is recorded on that tranche so that the servicing asset is carried at fair value. Fair value is determined at a tranche level, based on market prices for comparable mortgage servicing contracts, when available, or alternatively based on a valuation model that calculates the present value of estimated future net servicing income. The valuation model utilizes assumptions that market participants would use in estimating future net servicing income and that can be validated against available market data (Level 2).

Loans held for sale: Loans held for sale are carried at the lower of cost or fair value, which is evaluated on a pool-level basis. The fair value of loans held for sale is determined using quoted prices for similar assets, adjusted for specific attributes of that loan or other observable market data, such as outstanding commitments from third party investors (Level 2).

Loans held for sale, at fair value:  The Company elected the fair value option for all conventional residential one-to four-family loans held for sale originated after January 1, 2016 and all permanent construction loans held for sale originated on or after January 1, 2015.   The fair value of conventional loans held for sale is determined using the current 15 day forward contract price for either 15 or 30 year conventional mortgages (Level 2)

The fair value of the Company’s permanent construction loans held for sale is determined using the current 60 day forward contract price for 30 year conventional loans which is then adjusted by extrapolating this rate to the estimated time period remaining until construction is complete.  The fair value is also adjusted for unobservable market data such as estimated fall out rates and the estimated time from origination to completion of construction (Level 3).  

Interest rate caps: Home Savings uses an independent third party that performs a market valuation analysis for interest rate caps. The methodology used consists of a discounted cash flow model, all future floating cash flows are projected and both floating and fixed cash flows are discounted to the valuation date. The yield curve utilized for discounting and projecting is built by obtaining publicly available third party market quotes from Reuters, which handle up to 30-year swap maturities (Level 3). Assumptions used in the valuation of interest rate caps are back-tested for reasonableness on a quarterly basis using an independent source along with a third party service.

Purchased and written certificate of deposit option: Home Savings periodically enters into written and purchased option derivative instruments to facilitate the Power CD. The written and purchased options are mirror derivative instruments which are carried at fair value on the consolidated balance sheets. Home Savings uses an independent third party that performs a market valuation analysis for purchased and written certificate of deposit options. (Level 2)

Assets and Liabilities Measured on a Recurring Basis: Assets and liabilities measured at fair value on a recurring basis are summarized below:

			Fair Value Measurements at June 30, 2017 Using:
			Quoted
			Prices in
			Active		Significant
			Markets for		Other		Significant
			Identical		Observable		Unobservable
	June 30,		Assets		Inputs		Inputs
	2017		(Level 1)		(Level 2)		(Level 3)
	(Dollars in thousands)
Assets:
Available for sale securities
U.S. Treasury and government sponsored entities'    securities	$	134,603	$	—	$	134,603	$	—
States of the U.S. and political subdivisions		58,824		—		58,824
Mortgage-backed GSE securities: residential		93,752		—		93,752		—
Loans held for sale, at fair value		85,954		—		15,959		69,995
Purchased certificate of deposit option		746		—		746		—
Liabilities
Written certificate of deposit option		746		—		746		—

			Fair Value Measurements at December 31, 2016 Using:
			Quoted
			Prices in
			Active		Significant
			Markets for		Other		Significant
			Identical		Observable		Unobservable
	December 31,		Assets		Inputs		Inputs
	2016		(Level 1)		(Level 2)		(Level 3)
	(Dollars in thousands)
Assets:
Available for sale securities
U.S. Treasury and government sponsored entities'    securities	$	186,033	$	—	$	186,033	$	—
States of the U.S. and political subdivisions		57,757		—		57,757		—
Mortgage-backed GSE securities: residential		99,494		—		99,494		—
Loans held for sale, at fair value		62,593		—		8,832		53,761
Purchased certificate of deposit option		882		—		882		—
Liabilities
Written certificate of deposit option		882		—		882		—

There were no transfers between Level 1 and Level 2 during 2017 or 2016.

The table below presents a reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three and six months ended June 30, 2017 and 2016.  

	Loans Held for Sale, At Fair Value						Loans Held for Sale, At Fair Value
	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2017			2016			2017			2016
	(Dollars in thousands)
Balance of recurring Level 3 assets at beginning of period	$	67,439		$	26,760		$	53,761		$	26,716
Total gains (losses) for the period
Included in change in fair value of loans held for sale		1,822			622			2,412			1,291
Included in other comprehensive income					—						—
Originations/Draws on construction perm loans		25,945			19,132			51,245			35,819
Amortization					—						—
Sales		(25,211	)		(12,909	)		(37,423	)		(30,221	)
Balance of recurring Level 3 assets at end of period	$	69,995		$	33,605		$	69,995		$	33,605

The following table presents quantitative information about recurring Level 3 fair value measurements at June 30, 2017:

			Valuation	Unobservable
	Fair Value		Technique(s)	Input(s)	Range
Loans held for sale, at fair value	$	69,995	Comparable sales	Time discount	0.00-1.80%

The following table presents quantitative information about recurring Level 3 fair value measurements at December 31, 2016:

			Valuation	Unobservable
	Fair Value		Technique(s)	Input(s)	Range
Loans held for sale, at fair value	$	53,761	Comparable sales	Time discount	0.00-1.80%

The fair value of loans held for sale, at fair value was determined using pricing from a quoted market, discounted for the length of time to the completion of the construction project.

Assets and Liabilities Measured on a Non-Recurring Basis: Assets and liabilities measured at fair value on a non-recurring basis are summarized below:

			Fair Value Measurements at June 30, 2017 Using:
			Quoted
			Prices in
			Active		Significant
			Markets for		Other		Significant
			Identical		Observable		Unobservable
	June 30,		Assets		Inputs		Inputs
	2017		(Level 1)		(Level 2)		(Level 3)
	(Dollars in thousands)
Assets:
Impaired loans:
Commercial loans
Multifamily	$	418	$	—	$	—	$	418
Residential loans
One-to four-family residential		756		—		—		756
Consumer loans
Home Equity		28		—		—		28
Auto		17		—		—		17
Marine		169		—		—		169
Recreational vehicle		55		—		—		55
Mortgage servicing rights		82		—		82		—
Other real estate owned, net
Commercial loans
Construction loans		448		—		—		448
Residential loans
One-to four-family residential		35		—		—		35

			Fair Value Measurements at December 31, 2016 Using:
			Quoted
			Prices in
			Active		Significant
			Markets for		Other		Significant
			Identical		Observable		Unobservable
	December 31,		Assets		Inputs		Inputs
	2016		(Level 1)		(Level 2)		(Level 3)
	(Dollars in thousands)
Assets:
Impaired loans:
Commercial loans
Nonresidential	$	2,257	$	—	$	—	$	2,257
Secured		284		—		—		284
Residential loans
One-to four-family residential		919		—		—		919
Consumer loans
Home Equity		228		—		—		228
Auto		177		—		—		177
Recreational vehicle		89		—		—		89
Other real estate owned, net
Commercial loans
Construction loans		748		—		—		748
Residential loans
One-to four-family residential		281		—		—		281

Impaired loans with specific allocations of the allowance for loan losses, carried at fair value, which are measured for impairment using the fair value of the collateral for collateral dependent loans, had a net carrying amount of $1.4 million at June 30, 2017, that includes a specific valuation allowance of $5,000. This resulted in an increase of the provision for loan losses of $252,000 and $479,000 during the three and six months ended June 30, 2017, respectively. Impaired loans with specific allocations of the allowance for loan losses, carried at fair value, which are measured for impairment using the fair value of the collateral for collateral dependent loans, had a net carrying amount of $8.2 million at June 30, 2016, which includes a specific valuation allowance of $1.0 million. This resulted in an increase in the provision for loan losses of $592,000 and $3.6 million for the three and six months ended June 30, 2016.  Impaired loans with specific allocations of the allowance for loan losses, carried at fair value, which are measured for impairment using the fair value of the collateral for collateral dependent loans, had a net carrying amount of $4.0 million at December 31, 2016, that includes a specific valuation allowance of $1.3 million.

The significant unobservable (Level 3) inputs used in the fair value measurement of collateral for collateral dependent impaired loans included in the above table primarily relate to the adjustment between carrying values versus appraised value. During the reported periods, discounts applied to appraisals for estimated selling costs were 10%.

At June 30, 2017, mortgage servicing rights carried at fair value were $87,000, with a net valuation allowance of $5,000.  At June 30, 2016, mortgage servicing rights, carried at fair value totaled $2.8 million, resulting in a net valuation allowance of $766,000.  Mortgage servicing rights are valued by an independent third party that is active in purchasing and selling these instruments.  Net impairment reflected in other income totaled $2,000 and $5,000 for the three and six months ended June 30, 2017.  Net impairment reflected in other income totaled $292,000 and $727,000 for the three and six months ended June 30, 2016.  The value reflects the characteristics of the underlying loans.  

At June 30, 2017, other real estate owned, carried at fair value, which is measured for impairment using the fair value of the property less estimated selling costs, and had a net carrying amount of $483,000, with a valuation allowance of $389,000. This resulted in a recovery of expense of $0 and $(38,000) during the three and six months ended June 30, 2017.  At June 30, 2016, other real estate owned, carried at fair value, which is measured for impairment using the fair value of the property less estimated selling costs, and had a net carrying amount of $1.0 million with a valuation allowance of $1.0 million. This resulted in a recovery of $(27,000) and $(26,000) during the three and six months ended June 30, 2016. At December 31, 2016, other real estate owned had a net carrying amount of $1.0 million, with a valuation allowance of $1.0 million.

The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a nonrecurring basis at June 30, 2017:

	Fair Value		Valuation Technique(s)	Unobservable Input(s)	Range     (Weighted Average)
Impaired loans:
Commercial loans
Multi Family	$	418	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-35.00%  (15.00%)
Residential loans
One-to four-family residential		756	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-10.77%  (4.27%)
Consumer loans
Home Equity		28	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-17.85%  (8.93%)
Marine		169	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-37.00%  (37.00%)
Other real estate owned, net
Commercial loans
Construction loans		448	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-80.00%(24.03%)
Residential loans
One-to four-family residential		35	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-3.77%  (3.77%)

The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a nonrecurring basis at December 31, 2016:

	Fair Value		Valuation Technique(s)	Unobservable Input(s)	Range     (Weighted Average)
Impaired loans:
Commercial loans
Nonresidential	$	2,257	Sales comparison approach	Adjustment for differences between comparable sales	0.00-35.00%  (15.00%)
Secured		284	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-64.00%  (16.00%)
Residential loans
One-to four-family residential		919	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-10.77%  (4.27%)
Consumer loans
Home Equity		228	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-17.85%  (8.93%)
Other real estate owned:
Commercial loans
Construction loans		748	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-90.40%  (27.46%)
			Cost approach	Adjustment for differences in cost	0.00%-33.33%  (16.67%)
Residential loans
One-to four-family residential		281	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-27.00%  (7.74%)

Auto and recreational vehicle loans were excluded from the table above as their value is considered immaterial.

The Company has elected the fair value option for newly originated residential mortgage and permanent construction loans held for sale.  These loans are intended for sale and the Company believes that fair value is the best indicator of the resolution of these loans.  Interest income is recorded based on the contractual terms of the loan and in accordance with the Company’s policy on loans held for investment.  None of these loans are 90 or more days past due nor on nonaccrual status as of June 30, 2017 and December 31, 2016.  

	June 30, 2017		December 31, 2016
	(Dollars in thousands)
Aggregate fair value	$	85,954	$	62,593
Contractual balance		83,304		62,843
Gain (loss)		2,650		(250	)

The total amount of gains and losses from changes in fair value included in earnings for the three and six months ended June 30, 2017 and 2016 for loans held for sale, at fair value were:

	For the Three Months Ended				For the Six Months Ended
	June 30, 2017		June 30, 2016		June 30, 2017		June 30, 2016
	(Dollars in thousands)
Interest  income	$	—	$	—	$	—	$	—
Interest expense		—		—		—		—
Change in fair value		2,149		845		2,900		1,649
Total change in fair value	$	2,149	$	845	$	2,900	$	1,649

In accordance with U.S. GAAP, the carrying value and estimated fair values of financial instruments at June 30, 2017 and December 31, 2016, were as follows:

				Fair Value Measurements at June 30, 2017 Using:
	June 30,
	2017
	Carrying Value			(Level 1)			(Level 2)			(Level 3)
	(Dollars in thousands)
Assets:
Cash and cash equivalents	$	52,014		$	52,014		$	—		$	—
Available for sale securities		287,179			—			287,179			—
Held to maturity securities		88,559			—			87,775			—
Loans held for sale		199			—			205			—
Loans held for sale, at fair value		85,954			—			15,959			69,995
Loans, net		1,869,095			—			—			1,864,169
FHLB stock		19,324		n/a			n/a			n/a
Accrued interest receivable		7,420			—			2,225			5,195
Purchased certificate of deposit option		746			—			746			—
Liabilities:
Deposits:
Checking, savings and money market accounts		(1,252,227	)		(1,252,227	)		—			—
Certificates of deposit		(641,766	)		—			(642,416	)		—
FHLB advances		(328,146	)		—			(328,151	)		—
Repurchase agreements and other		(8,045	)		—			(7,837	)		—
Advance payments by borrowers for taxes and insurance		(21,989	)		(21,989	)		—			—
Accrued interest payable		(392	)		—			(392	)		—
Written certificate of deposit option		(746	)		—			(746	)		—

				Fair Value Measurements at December 31, 2016 Using:
	December 31,
	2016
	Carrying Value			(Level 1)			(Level 2)			(Level 3)
	(Dollars in thousands)
Assets:
Cash and cash equivalents	$	45,887		$	45,887		$	—		$	—
Available for sale securities		343,284			—			343,284			—
Held to maturity securities		97,519			—			92,940			3,210
Loans held for sale at lower of cost or market		165			—			169			—
Loans held for sale, at fair value		62,593			—			8,832			53,761
Loans, net		1,503,577			—			—			1,494,534
FHLB stock		18,068		n/a			n/a			n/a
Accrued interest receivable		6,900			—			2,624			4,276
Purchased certificate of deposit option		882			—			882			—
Liabilities:
Deposits:
Checking, savings and money market accounts		(1,026,565	)		(1,026,565	)		—			—
Certificates of deposit		(488,426	)		—			(491,278	)		—
FHLB advances		(390,756	)		—			(390,750	)		—
Repurchase agreements and other		(512	)		—			(513	)		—
Advance payments by borrowers for taxes and insurance		(23,812	)		(23,812	)		—			—
Accrued interest payable		(145	)		—			(145	)		—
Written certificate of deposit option		(882	)		—			(882	)		—

The methods and assumptions, not previously presented, used to estimate fair values are described as follows:

(a) Cash and Cash Equivalents

The carrying amounts of cash and short-term instruments approximate fair values and are classified as Level 1.

(b) FHLB Stock

It is not practical to determine the fair value of FHLB stock due to restrictions placed on its transferability.

(c) Held to maturity securities

Fair values for held to maturity securities are based on quoted market prices, where available. If quoted market prices are not available, fair values are based on quoted market prices of comparable instruments. For securities where quoted prices or market prices of similar securities are not available, fair values are calculated using discounted cash flows.

(d) Loans

Fair values of loans, excluding loans held for sale, are estimated as follows: for variable rate loans that reprice frequently and with no significant change in credit risk, fair values are based on carrying values resulting in a Level 3 classification; fair values for other loans are estimated using discounted cash flow analyses, using interest rates currently being offered for loans with similar terms to borrowers of similar credit quality resulting in a Level 3 classification; and impaired loans are valued at the lower of cost or fair value as described previously. The methods utilized to estimate the fair value of loans do not necessarily represent an exit price.

(e) Deposits

The fair values disclosed for demand deposits (e.g., interest and non-interest checking, savings, and certain types of money market accounts) are, by definition, equal to the amount payable on demand at the reporting date (i.e., their carrying amount) resulting in a Level 1 classification. The carrying amounts of variable rate, fixed-term money market accounts approximate their fair values at the reporting date resulting in a Level 1 classification. Fair values for fixed and variable rate certificates of deposit are estimated using a discounted cash flow calculation that applies interest rates currently being offered on certificates of deposit to a schedule of aggregated expected monthly maturities on time deposits resulting in a Level 2 classification.

(f) Other Borrowings

Short-term borrowings, generally maturing within 90 days, approximate their fair values resulting in a Level 2 classification. The fair values of Home Savings long-term borrowings are estimated using discounted cash flow analyses based on the current borrowing rates for similar types of borrowing arrangements resulting in a Level 2 classification.

(g) Accrued Interest Receivable/Payable

The carrying amounts of accrued interest approximate fair value resulting in a Level 2 or Level 3 classification, depending on the classification of the underlying asset or liability.

(h) Off-balance Sheet Instruments

Fair values for off-balance sheet, credit-related financial instruments are based on fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the counterparties’ credit standing. The fair value of commitments is not material.

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STATEMENT OF CASH FLOWS SUPPLEMENTAL DISCLOSURE

6 Months Ended

Jun. 30, 2017

Supplemental Cash Flow Elements [Abstract]

STATEMENT OF CASH FLOWS SUPPLEMENTAL DISCLOSURE

10. STATEMENT OF CASH FLOWS SUPPLEMENTAL DISCLOSURE

Supplemental disclosures of cash flow information are summarized below.

	For the Six Months Ended June 30,
	2017		2016
	(Dollars in thousands)
Supplemental disclosures of cash flow information
Cash paid  during the period for:
Interest on deposits and borrowings	$	5,396	$	4,166
Income taxes		250		150
Supplemental schedule of noncash activities:
Transfers from loans to real estate owned and other repossessed assets		282		534
Transfers from loans to loans held for sale		27,921		—
Transfers from premises and equipment to other assets, held for sale		1,720		—
Accretion of securities held to maturity		100		109
Issuance of common stock - James & Sons acquisition		—		1,508
Issuance of common stock - Ohio Legacy Corp. acquisition		25,816		—
Net assets acquired from Ohio Legacy Corp., excluding cash and cash equivalents		36		—

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EARNINGS PER SHARE

6 Months Ended

Jun. 30, 2017

Earnings Per Share [Abstract]

EARNINGS PER SHARE

11. EARNINGS PER SHARE

The Company has granted stock compensation awards with nonforfeitable dividend rights which are considered participating securities. As such, earnings per share is computed using the two-class method as required by ASC 206-10-45. Basic earnings per common share is computed by dividing net income allocated to common shareholders by the weighted average number of common shares outstanding during the period which excludes the participating securities. Diluted earnings per common share includes the dilutive effect of additional potential common shares from stock compensation awards, but also excludes awards considered participating securities. No stock options were anti-dilutive for the three and six months ended June 30, 2017.  No stock options were anti-dilutive for the three months ended June 30, 2016 and stock options for 71,391 shares were anti-dilutive for the six months ended June 30, 2016.  

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2017			2016			2017			2016
	(Dollars in thousands, except per share data)
Net income per consolidated statements of income	$	8,189		$	5,330		$	9,727		$	8,650
Net income allocated to participating securities		(49	)		(40	)		(61	)		(55	)
Net income allocated to common stock	$	8,140		$	5,290		$	9,666		$	8,595
Basic earnings per common share computation:
Distributed earnings allocated to common stock	$	1,483		$	1,180		$	2,962		$	2,368
Undistributed earnings allocated to common stock		6,657			4,110			6,704			6,227
Net income allocated to common stock	$	8,140		$	5,290		$	9,666		$	8,595
Weighted average common shares outstanding, including shares    considered participating securities		49,691			47,223			49,158			47,405
Less: Average participating securities		(299	)		(354	)		(309	)		(299	)
Weighted average shares		49,392			46,869			48,849			47,106
Basic earnings per common share	$	0.16		$	0.11		$	0.20		$	0.18
Diluted earnings per common share computation:
Net income allocated to common stock	$	8,140		$	5,290		$	9,666		$	8,595
Weighted average common shares outstanding for basic    earnings per common share		49,392			46,869			48,849			47,106
Add: Dilutive effects of assumed exercises of stock options and LTIP    awards		403			248			398			247
Weighted average shares and dilutive potential common shares		49,795			47,117			49,247			47,353
Diluted earnings per common share	$	0.16		$	0.11		$	0.20		$	0.18

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OTHER COMPREHENSIVE INCOME (LOSS)

6 Months Ended

Jun. 30, 2017

Equity [Abstract]

OTHER COMPREHENSIVE INCOME (LOSS)

12. OTHER COMPREHENSIVE INCOME (LOSS)

Other comprehensive income (loss) included in the consolidated statements of shareholders’ equity consists of unrealized gains and losses on available for sale securities, disproportional tax effects and changes in unrealized gains and losses on the postretirement liability. The change includes reclassification of net gains or (losses) on sales of securities of $301,000 and $233,000 for the three months ended June 30, 2017 and 2016, respectively and $330,000 and $386,000 for the six months ended June 30, 2017 and 2016, respectively.  Reclassifications also include amortization of unrealized gains on postretirement plan and accretion of unrealized loss on held to maturity securities.    

Other comprehensive income (loss) components and related tax effects for the three-month periods are as follows:

	Unrealized Gains (Losses) on Securities Availablefor Sale			Disproportionate Tax Effect from Securities Available for Sale			Losses on Securities Transferred From Available for Sale to Held to Maturity			Total
June 30, 2017	(Dollars in thousands)
Balances at beginning of period, net of tax	$	(2,165	)	$	(17,110	)	$	(767	)	$	(20,042	)
Other comprehensive income before    reclassifications		1,758			—			—			1,758
Accretion of unrealized losses of securities    transferred from available for sale to    held to maturity recognized in other    comprehensive income		—			—			32			32
Reclassification adjustment for gains realized    in income		(196	)		—			—			(196	)
Net current period other comprehensive income		1,562			—			32			1,594
Balances at end of period, net of tax	$	(603	)	$	(17,110	)	$	(735	)	$	(18,448	)

	Unrealized Gains (Losses) on Securities Available for Sale			Disproportionate Tax Effect from Securities Available for Sale			Losses on Securities Transferred From Available for Sale to Held to Maturity			Unrealized Gains (Losses) from Postretirement Plan			Disproportionate Tax Effect from Postretirement Plan		Total
June 30, 2016	(Dollars in thousands)
Balances at beginning of period,    net of tax	$	3,937		$	(17,110	)	$	(926	)	$	650		$	511	$	(12,938	)
Other comprehensive income    before reclassifications		4,594			—			—			—			—		4,594
Amortization of unrealized gains    of postretirement plan    recognized in other    comprehensive income		—			—			—			(181	)		—		(181	)
Accretion of unrealized losses of    securities transferred from    available for sale to held    to maturity recognized in    other comprehensive income		—			—			37			—			—		37
Reclassification adjustment for    gains realized in income		(152	)		—			—			—			—		(152	)
Net current period other    comprehensive income		4,442			—			37			(181	)		—		4,298
Balances at end of period, net of    tax	$	8,379		$	(17,110	)	$	(889	)	$	469		$	511	$	(8,640	)

Other comprehensive income (loss) components and related tax effects for the six-month periods are as follows:

	Unrealized Gains (Losses) on Securities Availablefor Sale			Disproportionate Tax Effect from Securities Available for Sale			Losses on Securities Transferred From Available for Sale to Held to Maturity			Total
June 30, 2017	(Dollars in thousands)
Balances at beginning of period, net of tax	$	(3,130	)	$	(17,110	)	$	(800	)	$	(21,040	)
Other comprehensive income before    reclassifications		2,742			—			—			2,742
Accretion of unrealized losses of securities    transferred from available for sale to held    to maturity recognized in other    comprehensive income		—			—			65			65
Reclassification adjustment for gains realized    in income		(215	)		—			—			(215	)
Net current period other comprehensive    income		2,527			—			65			2,592
Balances at end of period, net of tax	$	(603	)	$	(17,110	)	$	(735	)	$	(18,448	)

	Unrealized Gains (Losses) on Securities Available for Sale			Disproportionate Tax Effect from Securities Available for Sale			Losses on Securities Transferred From Available for Sale to Held to Maturity			Unrealized Gains (Losses) from Postretirement Plan			Disproportionate Tax Effect from Postretirement Plan		Total
June 30, 2016	(Dollars in thousands)
Balances at beginning of period,    net of tax	$	(2,492	)	$	(17,110	)	$	(960	)	$	831		$	511	$	(19,220	)
Other comprehensive income    before reclassifications		11,122			—						—			—		11,122
Amortization of unrealized    gains of postretirement plan    recognized in other    comprehensive income		—			—			—			(362	)		—		(362	)
Accretion of unrealized losses    of securities transferred    from available for sale to    held to maturity recognized    in other comprehensive    income		—			—			71			—			—		71
Reclassification adjustment    for gains realized in income		(251	)		—			—			—			—		(251	)
Net current period other    comprehensive income		10,871			—			71			(362	)		—		10,580
Balances at end of period, net of    tax	$	8,379		$	(17,110	)	$	(889	)	$	469		$	511	$	(8,640	)

As of June 30, 2014, management concluded it was more likely than not that the Company’s net deferred tax asset (DTA) would be realized and accordingly determined a full deferred tax valuation allowance was no longer required. Upon reversal of the former full deferred tax valuation allowance as of June 30, 2014, certain disproportionate tax effects are retained in accumulated other comprehensive income (loss) totaling approximately a ($16.6) million loss. Almost the entire disproportionate tax effect is attributable to valuation allowance expense recorded through other comprehensive income (loss) on the tax benefit of losses sustained on the available for sale securities portfolio while the Company was in a full deferred tax valuation allowance. This valuation allowance was appropriately reversed through continuing operations at June 30, 2014, leaving the original expense in accumulated other comprehensive income (loss), where it will remain in accordance with the Company’s election of the “portfolio approach”, until such time as the Company would cease to have an available for sale security portfolio.

The following are significant amounts reclassified out of each component of accumulated comprehensive income (loss) for the three months ended June 30, 2017:

	Amount Reclassified			Affected Line Item on
	From Accumulated			the Statement Where
Details About Accumulated Other Comprehensive	Other Comprehensive			Net Income is
Income Components	Income			Presented
	(Dollars in thousands)
Realized net gains on the sale of available for sale securities	$	(301	)	Net gains on securitiesavailable for sale
		105		Tax expense
Total reclassification during the period	$	(196	)	Net of tax, increase to net income

The following are significant amounts reclassified out of each component of accumulated comprehensive income (loss) for the three months ended June 30, 2016:

	Amount Reclassified			Affected Line Item on
	From Accumulated			the Statement Where
Details About Accumulated Other Comprehensive	Other Comprehensive			Net Income is
Income Components	Income			Presented
	(Dollars in thousands)
Realized net gains on the sale of available for sale securities	$	(233	)	Net gainson securitiesavailable for sale
		81		Tax expense
		(152	)	Net of tax
Amortization of postretirement benefits prior service costs		(278	)	Reduction in salaries and employee benefits
		97		Tax expense
		(181	)	Net of tax
Total reclassification during the period	$	(333	)	Increase to net income

The following are significant amounts reclassified out of each component of accumulated comprehensive income (loss) for the six months ended June 30, 2017:

	Amount Reclassified			Affected Line Item on
	From Accumulated			the Statement Where
Details About Accumulated Other Comprehensive	Other Comprehensive			Net Income is
Income Components	Income			Presented
	(Dollars in thousands)
Realized net gains on the sale of available for sale securities	$	(330	)	Net gains on securitiesavailable for sale
		115		Tax expense
Total reclassification during the period	$	(215	)	Net of tax, increase to net income

The following are significant amounts reclassified out of each component of accumulated comprehensive income (loss) for the six months ended June 30, 2016:

	Amount Reclassified			Affected Line Item on
	From Accumulated			the Statement Where
Details About Accumulated Other Comprehensive	Other Comprehensive			Net Income is
Income Components	Income			Presented
	(Dollars in thousands)
Realized net gains on the sale of available for sale securities	$	(386	)	Net gainson securitiesavailable for sale
		135		Tax expense
		(251	)	Net of tax
Amortization of postretirement benefits prior service costs		(556	)	Reduction in salaries and employee benefits
		194		Tax expense
		(362	)	Net of tax
Total reclassification during the period	$	(613	)	Increase to net income

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REGULATORY CAPITAL REQUIREMENTS

6 Months Ended

Jun. 30, 2017

Banking And Thrift [Abstract]

REGULATORY CAPITAL REQUIREMENTS

13. REGULATORY CAPITAL REQUIREMENTS

Home Savings and United Community are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possible additional discretionary actions by regulators that, if undertaken, could have a direct material effect on Home Savings and United Community. The regulations require Home Savings to meet specific capital adequacy guidelines in keeping with the regulatory framework for prompt corrective action that involve quantitative measures of Home Savings’ assets, liabilities, and certain off balance sheet items as calculated under regulatory accounting practices. Home Savings’ capital classification is also subject to qualitative judgments by the regulators about components of capital, risk weightings, and other factors.

The Basel III Capital Rules establish a common equity Tier 1 minimum capital requirement (4.5% of risk-weighted assets), a minimum Tier 1 capital to risk-based assets requirement (6% of risk-weighted assets) and assigns a risk weight (150%) to exposures that are more than 90 days past due or are on nonaccrual status and to certain commercial real estate facilities that finance the acquisition, development or construction of real property. The rules also require unrealized gains and losses on certain available-for-sale securities holdings to be included for purposes of calculating regulatory capital requirements unless a one-time opt-in or opt-out is exercised. In connection with the adoption of the Basel III Capital Rules, United Community and Home Savings elected to opt-out of the requirement to include most components of accumulated other comprehensive income in Common Equity Tier 1.  The rule limits a banking organization’s capital distributions and certain discretionary bonus payments if the banking organization does not hold a “capital conservation buffer” consisting of 2.5% of common equity Tier 1 capital risk-based weighted assets in addition to the amount necessary to meeting its minimum risk-based capital requirements.

The capital conservation buffer requirement will be phased in through January 1, 2019, when the full capital conservation buffer requirement will be effective. The capital conservation buffer for 2017 is 1.25%.  The final rule also implemented consolidated capital requirements.

Quantitative measures established by regulation for capital adequacy require Home Savings to maintain minimum ratios of Tier 1 (or Core) capital (as defined in the regulations) to average total assets (as defined) and of total risk-based capital (as defined) to risk-weighted assets (as defined).  United Community and Home Savings’ Common Equity Tier 1 capital consists of common stock and related paid-in capital, net of treasury stock, and retained earnings. Common Equity Tier 1 for both United Community and Home Savings is reduced by intangible assets, net of associated deferred tax liabilities and subject to transition provisions. Actual and regulatory required capital ratios for Home Savings, along with the dollar amount of capital implied by such ratios, are presented below.

	June 30, 2017
											To Be Well Capitalized
						Minimum Capital					Under Prompt
						Requirements For Capital					Corrective Action
	Actual					Adequacy Purposes***					Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
	(Dollars in thousands)
Total capital (to risk-weighted assets)	$	277,583		14.83	%	$	173,129		9.25	%	$	187,166		10.00	%
Tier 1 capital (to risk-weighted assets)		257,947		13.78	%		135,695		7.25	%		149,733		8.00	%
Common equity Tier 1 capital (to risk-weighted    assets)		257,947		13.78	%		107,621		5.75	%		121,658		6.50	%
Tier 1 capital (to average assets)**		257,947		10.14	%		101,794		4.00	%		127,242		5.00	%

	December 31, 2016
											To Be Well Capitalized
						Minimum Capital					Under Prompt
						Requirements					Corrective Action
	Actual					Per Regulation***					Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
	(Dollars in thousands)
Total capital (to risk-weighted assets)	$	248,861		16.47	%	$	130,292		8.625	%	$	151,063		10.00	%
Tier 1 capital (to risk-weighted assets)		229,938		15.22	%		100,079		6.625	%		120,850		8.00	%
Common equity Tier 1 capital (to risk-weighted    assets)		229,938		15.22	%		77,420		5.125	%		98,191		6.50	%
Tier 1 capital (to average assets)**		229,938		10.65	%		86,360		4.000	%		107,950		5.00	%

** Tier 1 Leverage Capital Ratio

*** The capital ratios are reflective of the capital conservation buffer

Management believes that as of June 30, 2017 and December 31, 2016, Home Savings met all capital adequacy requirements to which it was subject.  As of June 30, 2017 and December 31, 2016, Home Savings met the capital requirements to be deemed well capitalized. There are no known conditions that would change this classification subsequent to June 30, 2017.  

The components of Home Savings’ regulatory capital are as follows:

	June 30, 2017			December 31, 2016
Total shareholders' equity	$	264,512		$	216,475
Add (deduct)
Accumulated other comprehensive income		18,463			21,056
Intangible assets		(20,313	)		(3	)
Disallowed deferred tax assets		(4,715	)		(7,590	)
Disallowed capitalized mortgage loan servicing rights		—			—
Tier 1 Capital		257,947			229,938
Allowance for loan losses and allowance for unfunded lending commitments    limited to 1.25% of total risk-weighted assets		19,636			18,923
Total risk-based capital	$	277,583		$	248,861

Actual and regulatory required consolidated capital ratios for United Community, along with the dollar amount of capital implied by such ratios, are presented below.

	June 30, 2017
						Minimum Capital
						Requirements
	Actual					Per Regulation***
	Amount		Ratio			Amount		Ratio
	(Dollars in thousands)
Total capital (to risk-weighted assets)	$	293,814		15.66	%	$	173,548		9.25	%
Tier 1 capital (to risk-weighted assets)		274,154		14.61	%		136,024		7.25	%
Common equity Tier 1 capital (to risk-weighted assets)		274,154		14.61	%		107,881		5.75	%
Tier 1 capital (to average assets)**		274,154		10.76	%		101,870		4.00	%
	December 31, 2016
						Minimum Capital
						Requirements
	Actual					Per Regulation***
	Amount		Ratio			Amount		Ratio
	(Dollars in thousands)
Total capital (to risk-weighted assets)	$	277,817		18.38	%	$	130,369		8.625	%
Tier 1 capital (to risk-weighted assets)		258,869		17.13	%		100,139		6.625	%
Common equity Tier 1 capital (to risk-weighted assets)		258,869		17.13	%		77,466		5.125	%
Tier 1 capital (to average assets)**		258,869		11.98	%		86,425		4.000	%

As of June 30, 2017 and December 31, 2016, United Community’s capital exceeded the requirements to be deemed well capitalized.

The components of United Community’s consolidated regulatory capital are as follows:

	June 30, 2017			December 31, 2016
Total shareholders' equity	$	285,480		$	249,806
Add (deduct)
Accumulated other comprehensive income		18,463			21,040
Intangible assets		(21,352	)		(1,567	)
Disallowed deferred tax assets		(8,437	)		(10,410	)
Disallowed capitalized mortgage loan servicing rights		—			—
Tier 1 Capital		274,154			258,869
Allowance for loan losses and allowance for unfunded lending commitments    limited to 1.25% of total risk-weighted assets		19,660			18,948
Total risk-based capital	$	293,814		$	277,817

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INCOME TAXES

6 Months Ended

Jun. 30, 2017

Income Tax Disclosure [Abstract]

INCOME TAXES

14. INCOME TAXES

Significant components of the deferred tax assets and liabilities are as follows:

	June 30,		December 31,
	2017		2016
	(Dollars in thousands)
Deferred tax assets:
Loan loss reserves	$	6,881	$	6,680
Depreciation		886		748
Other real estate owned valuation		136		354
Tax credits carryforward		1,845		1,471
Unrealized loss on securities available for sale		324		1,685
Unrealized loss on securities held to maturity		396		431
Interest on nonaccrual loans		952		1,039
Net operating loss carryforward		6,593		8,574
Purchase accounting adjustment		1,000		—
Accrued bonuses		756		812
Other		79		221
Deferred tax assets		19,848		22,015
Deferred tax liabilities:
Deferred loan fees		1,622		1,275
Federal Home Loan Bank stock dividends		4,645		4,585
Mortgage servicing rights		2,155		2,124
FHLB prepayment penalty		649		786
Purchase accounting adjustment		—		371
Prepaid expenses		671		139
Deferred tax liabilities		9,742		9,280
Net deferred tax asset	$	10,106	$	12,735

As of June 30, 2017, the net deferred tax asset was $10.1 million, and as of December 31, 2016, the net deferred tax asset was $12.7 million.

The Company’s ultimate realization of the net deferred tax asset is dependent upon the generation of future taxable income during the periods in which temporary differences become deductible. Management considers the nature and amount of historical and projected future taxable income, the scheduled reversal of deferred tax assets and liabilities, and available tax planning strategies in making this assessment. The amount of deferred taxes recognized could be impacted by changes to any of these variables.

United Community’s net operating loss of $18.8 million at June 30, 2017 will be carried forward to use against future taxable income. The net operating loss carryforwards begin to expire in the year ending December 31, 2030. In addition, United Community is carrying forward $1.8 million of alternative minimum tax credits. The alternative minimum tax credits are carried forward indefinitely.

Effective tax rates differr from the statutory federal income tax rate of 35% due to the following:

	For the Three Months Ended June 30,
	2017						2016
	Dollars			Rate			Dollars			Rate
	(Dollars in thousands)
Tax at statutory rate:	$	4,048			35.00	%	$	2,751			35.00	%
Increase (decrease) due to:
Tax exempt income		(166	)		(1.44	)%		(124	)		(1.57	)%
Life insurance		(137	)		(1.18	)%		(128	)		(1.63	)%
Stock compensation		(138	)		(1.19	)%		—			—	%
Other		(230	)		(1.99	)%		30			0.38	%
Income tax provision	$	3,377			29.20	%	$	2,529			32.18	%

	For the Six Months Ended June 30,
	2017						2016
	Dollars			Rate			Dollars			Rate
	(Dollars in thousands)
Tax at statutory rate:	$	4,781			35.00	%	$	4,470			35.00	%
Increase (decrease) due to:
Tax exempt income		(337	)		(2.47	)%		(187	)		(1.47	)%
Life insurance		(269	)		(1.97	)%		(256	)		(2.00	)%
Stock compensation		(198	)		(1.45	)%		—			—	%
Other		(43	)		(0.31	)%		94			0.74	%
Income tax provision	$	3,934			28.80	%	$	4,121			32.27	%

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GOODWILL AND INTANGIBLE ASSETS

6 Months Ended

Jun. 30, 2017

Goodwill And Intangible Assets Disclosure [Abstract]

GOODWILL AND INTANGIBLE ASSETS

15. GOODWILL AND INTANGIBLE ASSETS

Goodwill:

The change in goodwill during the periods presented is as follows:

	June 30, 2017		December 31, 2016
	(In thousands)
Beginning of the year	$	208	$	—
Effect of adjustments-James & Sons Insurance		636		—
Acquired goodwill-OLCB		18,420		—
Effect of adjustments-OLCB		15		—
Acquired goodwill-Eich Brothers Insurance		188		—
Acquired goodwill-James & Sons Insurance		—		208
Impairment	—		—
End of the year	$	19,467	$	208

The changes to goodwill during the six months ended June 30, 2017 are primarily due to changes in the final market value for the customer list intangible asset, as well as the related tax effect from those adjustments related to the James & Sons acquisition in January 2016.  

Impairment exists when a reporting unit’s carrying value of goodwill exceeds its fair value.  If the carrying amount of a reporting unit is zero or less than zero, a qualitative analysis of whether it is more likely than not that the reporting unit goodwill is impaired will be performed.  The qualitative assessment indicated that it was more likely than not that the fair value of the reporting unit exceeded its carrying value, resulting in no impairment.  The Company did not have any reporting units with a carrying amount of zero or less than zero at June 30, 2017 or December 31, 2016.

Acquired Intangible Assets:

	June 30, 2017				December 31, 2016
	Gross				Gross
	Carrying		Accumulated		Carrying		Accumulated
	Amount		Amortization		Amount		Amortization
	(In thousands)
Amortized intangible assets:
Core deposit intangibles	$	11,184	$	9,085	$	8,952	$	8,947
Customer list intangible		2,162		102		1,400		44
Total	$	13,346	$	9,187	$	10,352	$	8,991

Core deposit intangible:

	For the six months ended June 30, 2017			For the year ended December 31, 2016
	(In thousands)
Beginning of the year	$	5		$	30
Acquired core deposit intangible-OLCB		2,232			—
Amortization		(138	)		(25	)
End of the period	$	2,099		$	5

Customer list intangible:

	For the six months ended June 30, 2017			For the year ended December 31, 2016
	(In thousands)
Beginning of the year	$	1,356		$	—
Effect of adjustments-James & Sons Insurance		(41	)		—
Acquired customer list intangible-OLCB		268			—
Acquired customer list intangible-Eich Brothers Insurance		535			—
Acquired customer list intangible-James & Sons Insurance		—			1,400
Amortization		(58	)		(44	)
End of the period	$	2,060		$	1,356

Aggregate amortization expense for the three months ended June 30, 2017 and 2016 was $113,000 and $10,000, respectively.  Aggregate amortization expense for the six months ended June 30, 2017 and 2016 was $196,000 and $23,000, respectively.  Estimated amortization expense for the remainder of 2017 and the next five years is as follows:

Remainder of 2017	$	224,000
2018		448,000
2019		448,000
2020		448,000
2021		448,000
2022		448,000

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QUALIFIED AFFORDABLE HOUSING PROJECT INVESTMENTS

6 Months Ended

Jun. 30, 2017

Federal Home Loan Banks [Abstract]

QUALIFIED AFFORDABLE HOUSING PROJECT INVESTMENTS

16. QUALIFIED AFFORDABLE HOUSING PROJECT INVESTMENTS

The Company invests in qualified affordable housing projects.  At June 30, 2017 and December 31, 2016, the balance of the investment for qualified affordable housing projects was $6.0 million and $3.0 million, respectively.  These balances are reflected in other assets on the consolidated balance sheet.  Total unfunded commitments related to the investments in qualified affordable housing projects totaled $5.9 million and $2.9 million at June 30, 2017 and December 31, 2016, respectively.  The Company expects to fulfill these commitments over the next eight to ten years.

During the three months ended June 30, 2017 and 2016, the Company recognized amortization expense of $36,000 and $0, respectively which was included within income tax expense on the consolidated statements of income. During the six months ended June 30, 2017 and 2016, the Company recognized amortization expense of $90,000 and $0, respectively.

Additionally, during the three months ended June 30, 2017 and 2016, the Company recognized tax credits and other benefits from its investment in affordable housing tax credits of $44,000 and $0, respectively.  During the six months ended June 30, 2017 and 2016, the Company recognized tax credits and other benefits from its investment in affordable housing tax credits of $110,000 and $0, respectively.  During the three and six months ended June 30, 2017 and 2016, the Company incurred no impairment losses.

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RECENT ACCOUNTING DEVELOPMENTS (Policies)

6 Months Ended

Jun. 30, 2017

Accounting Changes And Error Corrections [Abstract]

Revenue from Contracts with Customers

In May 2014, FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606).  The ASU implements a common revenue standard that clarifies the principles for recognizing revenue. The core principle of ASU 2014-09 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply the following steps: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract and (v) recognize revenue when (or as) the entity satisfies a performance obligation. ASU 2014-09 was originally going to be effective on January 1, 2017; however, the FASB recently issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606) – Deferral of the Effective Date which deferred the effective date of ASU 2014-09 by one year to January 1, 2018. United Community’s revenue is comprised of net interest income on financial assets and financial liabilities, which is explicitly excluded from the scope of ASU 2014-09, and non-interest income. We expect that ASU 2014-09 will require us to change how we recognize certain insurance commissions and fees; however, we do not expect these changes to have a significant impact on our financial statements. Additional disclosures will be required to provide quantitative and qualitative information regarding the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. We continue to evaluate the impact of ASU 2014-09 on other components of non-interest income.

Recognition and Measurement of Financial Assets and Financial Liabilities

In January 2016, the FASB issued ASU 2016-01, Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. ASU 2016-01, among other things, (i) requires equity investments, with certain exceptions, to be measured at fair value with changes in fair value recognized in net income, (ii) simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment, (iii) eliminates the requirement for public business entities to disclose the methods and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet, (iv) requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes, (v) requires an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments, (vi) requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or the accompanying notes to the financial statements and (viii) clarifies that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities. The new guidance is effective for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2017.  Management is currently evaluating the impact of the adoption of this guidance on the Company’s consolidated financial statements and expects revisions to disclosures included in the consolidated financial statements.

Leases

In February 2016, the FASB issued ASU 2016-02 - Leases (Topic 842). The ASU will require all organizations that lease assets to recognize on the balance sheet the assets and liabilities for the rights and obligations created by those leases. Additional qualitative and quantitative disclosures will be required so that users can understand more about the nature of an entity’s leasing activities. The new guidance is effective for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2018. Early adoption is permitted. Management is currently evaluating the impact of the adoption of this guidance on the Company’s consolidated financial statements and expects to recognize an increase in other assets and other liabilities for the rights and obligations created by leasing of branch offices.  Management also expects minimal impact in the income statement with respect to occupancy expense related to leases.

Improvements to Employee Share-Based Payment Accounting

In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, which amends ASC Topic 718, Compensation - Stock Compensation. The ASU includes provisions intended to simplify various aspects related to how share-based payments are accounted for and presented in the financial statements.  Key provisions include the elimination of “windfall pools” and removes the requirement to delay recognition of a windfall tax benefit until it reduces current taxes payable.  Additionally, the simplification permits entities to withhold an amount up to the employees’ maximum individual tax rate in the relevant jurisdiction without resulting in a liability classification of the award.  Entities are now permitted to make accounting policy elections for the impact of forfeitures on the recognition of expense for share-based payment awards.  This ASU was adopted on January 1, 2017.  The Company recognized a tax benefit of $198,000 in income tax expense during the six months ended June 30, 2017 as a result of adoption related to vesting of restricted stock awards and exercised stock options.

In May 2017, the FASB issuedASU No. 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting . ASU 2017-09 applies to entities that change the terms or conditions of a share-based payment award.  The FASB adopted ASU 2017-09 to provide clarity and reduce diversity in practice as well as cost and complexity when applying the guidance in Topic 718, Compensation—Stock Compensation , to the modification of the terms and conditions of a share-based payment award.

The amendments in ASU 2017-09 include guidance on determining which changes to the terms and conditions of share-based payment awards require an entity to apply modification accounting under Topic 718.

These amendments require the entity to account for the effects of a modification unless all of the following conditions are met:

• The fair value (or calculated value or intrinsic value, if such an alternative measurement method is used) of the modified award is the same as the fair value (or value using an alternative measurement method) of the original award immediately before the original award is modified. If the modification does not affect any of the inputs to the valuation technique that the entity uses to value the award, the entity is not required to estimate the value immediately before and after the modification;

• The vesting conditions of the modified award are the same as the vesting conditions of the original award immediately before the original award is modified; and

• The classification of the modified award as an equity instrument or a liability instrument is the same as the classification of the original award immediately before the original award is modified.

The amendments are effective for all entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted, including adoption in any interim period for. The amendments should be applied prospectively to an award modified on or after the adoption date.  The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements.

Measurement of Credit Losses on Financial Instruments

In June 2016, FASB Issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.   This ASU adds a new Topic 326 to the Codification and removes the thresholds that companies apply to measure credit losses on financial instruments measured at amortized cost, such as loans, receivables, and held-to-maturity debt securities. Under current U.S. GAAP, companies generally recognize credit losses when it is probable that the loss has been incurred. The revised guidance will remove all recognition thresholds and will require companies to recognize an allowance for credit losses for the difference between the amortized cost basis of a financial instrument and the amount of amortized cost that the company expects to collect over the instrument’s contractual life. ASU 2016-13 also amends the credit loss measurement guidance for available-for-sale debt securities and beneficial interests in securitized financial assets. The guidance in ASU 2016-13 is effective for “public business entities,” as defined, that are SEC filers for fiscal years, and for interim periods with those fiscal years, beginning after December 15, 2019.  Early adoption of the guidance is permitted for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Management is currently evaluating the impact of the adoption of this guidance on the Company’s consolidated financial statements.  Management is aggregating the necessary data requirements and addressing any data-archiving improvements necessary for the implementation of this ASU.

Classification of Certain Cash Receipts and Cash Payments

In August 2016, FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments, which amends the guidance in ASC 230 on the classification of certain cash receipts and payments in the statement of cash flows. The primary purpose of the ASU is to reduce the diversity in practice that has resulted from the lack of consistent principles on this topic. The ASU’s amendments add or clarify guidance on eight cash flow issues:

• Debt prepayment or debt extinguishment costs.

• Settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing.

• Contingent consideration payments made after a business combination.

• Proceeds from the settlement of insurance claims.

• Proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies.

• Distributions received from equity method investees.

• Beneficial interests in securitization transactions.

• Separately identifiable cash flows and application of the predominance principle.

For public business entities, the guidance in the ASU is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years.  Early adoption is permitted for all entities. Entities must apply the guidance retrospectively to all periods presented but may apply it prospectively from the earliest date practicable if retrospective application would be impracticable.  Management is currently evaluating the impact of the adoption of this guidance on the Company’s consolidated financial statements.

Simplifying the Test for Goodwill Impairment

In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. This ASU eliminates Step 2 from the goodwill impairment test. Instead, under the new guidance, an entity is to perform its annual goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge would be recognized for the amount by which the carrying amount exceeds the reporting unit's fair value. The new guidance is effective for annual reporting periods, and interim reporting periods within those annual periods, beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The adoption of this guidance is not expected to have an impact on the Company’s consolidated financial statements.

Premium Amortization on Purchased Callable Debt Securities

In March 2017, the FASB issuedASU 2017-08, Receivables - Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities. This ASU amends the amortization period for certain purchased callable debt securities held at a premium. It shortens the amortization period for the premium to the earliest call date. Under current U.S. GAAP, premiums on callable debt securities generally are amortized to the maturity date. The new guidance is effective for annual reporting periods, and interim reporting periods within those annual periods, beginning after December 15, 2018. Early adoption is permitted for interim or annual periods. The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements.

Distinguishing Liabilities from Equity, Derivatives and Hedging

In July 2017, the FASB ASU No. 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480);Derivatives and Hedging (Topic 815 ): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception.  ASU 2017-11 simplifies the accounting for certain financial instruments with down round features, a provision in an equity-linked financial instrument (or embedded feature) that provides a downward adjustment of the current exercise price based on the price of future equity offerings.

The new ASU will require companies to disregard the down round feature when assessing whether the instrument is indexed to its own stock, for purposes of determining liability or equity classification. Companies that provide earnings per share (EPS) data will adjust their basic EPS calculation for the effect of the feature when triggered (i.e., when the exercise price of the related equity-linked financial instrument is adjusted downward because of the down round feature) and will also recognize the effect of the trigger within equity.

The provisions of the new ASU related to down rounds are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020. Early adoption is permitted for all entities.  The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements.

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STOCK COMPENSATION (Tables)

6 Months Ended

Jun. 30, 2017

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Summary of Option Activity in Plans

A summary of option activity in the plans is as follows:

	For the six months ended
	June 30, 2017
				Weighted		Aggregate
				average		intrinsic value
	Shares			exercise price		(in thousands)
Outstanding at beginning of year		371,218		$	2.55
Granted		—
Exercised		(33,418	)		2.18
Forfeited and expired		(600	)		2.10
Outstanding at end of period		337,200			2.55	$	1,931
Shares subject to options exercisable at end of period		337,200			2.55	$	1,931

Information Related to Stock Options

Information related to stock options for the three months ended June 30, 2017 and 2016 follows:

	June 30, 2017		June 30, 2016
Intrinsic value of options exercised	$	208,633	$	283,310
Cash received from option exercises		72,818		129,940
Tax benefit realized from option exercises		73,022		—
Weighted average fair value of options granted, per share	$	—	$	—

Summary of Changes in Company's Nonvested Restricted Shares

A summary of changes in the Company’s nonvested restricted shares for the six months ended June 30, 2017 is as follows:

	For the six months ended
	June 30, 2017
				Weighted
				average
				grant date
	Shares			fair value
Nonvested at beginning of year		341,184		$	5.50
Granted		68,761		$	8.62
Vested		(132,777	)	$	4.91
Forfeited		—		$	—
Nonvested shares at end of period		277,168		$	6.56

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BUSINESS COMBINATION (Tables) - OLCB [Member]

6 Months Ended

Jun. 30, 2017

Business Acquisition [Line Items]

Summary of Consideration Paid

The following table summarizes the consideration paid for OLCB.

	(In thousands)
Cash	$	20,379
United Community shares issued		25,816
Total fair value of consideration paid	$	46,195

Schedule of Assets Acquired and Liabilities Assumed

At the acquisition date, United Community added the following to the Company’s consolidated statements of financial position:

	(In thousands)
Cash	$	46,159
Loans		259,373
Available for sale securities		9,996
FHLB stock, at cost		1,256
Premises and equipment		2,940
Accrued interest		679
Other intangible assets		2,426
Other real estate owned		89
Other assets		7,988
Total assets acquired	$	330,906
Deposits assumed	$	266,279
Federal Home Loan Bank advances		23,500
Repurchase agreements and other borrowings		10,771
Accrued expenses and other liabilities		2,581
Total liabilities assumed	$	303,131
Goodwill created	$	18,420

Summary of Pro Forma Information

The following table presents proforma information as if the OLCB acquisition had occurred at the beginning of 2016.  The proforma information includes adjustments for interest income on loans and securities acquired, amortization of intangibles arising from the transaction, depreciation expense on property acquired, interest expense on deposits acquired, and the related income tax effects.  The proforma financial information is not necessarily indicative of the results of operations that would have occurred had the transaction been effected on the assumed dates.  Net income includes the recognition of $4.1 million in acquisiton related expenses incurred by United Community and $368,000 in acquisiton related expenses for OLCB during the six months ended June 30, 2017.  

	For the Six Months Ended June 30,
	2017		2016
	(In thousands, except per share data)
Net interest income	$	39,992	$	36,251
Net income		9,371		10,270
Basic earnings per share	$	0.19	$	0.20
Diluted earnings per share	$	0.19	$	0.20

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SECURITIES (Tables)

6 Months Ended

Jun. 30, 2017

Components of Available for Sale Portfolio

Components of the available for sale portfolio are as follows:

	June 30, 2017
			Gross		Gross
	Amortized		unrealized		unrealized			Fair
	cost		gains		losses			value
	(Dollars in thousands)
Available for Sale
U.S. Treasury and government sponsored entities' securities	$	134,820	$	273	$	(490	)	$	134,603
States of the U.S. and political subdivisions		59,112		387		(675	)		58,824
Mortgage-backed GSE securities: residential		94,173		91		(512	)		93,752
Total	$	288,105	$	751	$	(1,677	)	$	287,179

	December 31, 2016
			Gross		Gross
	Amortized		unrealized		unrealized			Fair
	cost		gains		losses			value
	(Dollars in thousands)
Available for Sale
U.S. Treasury and government sponsored entities' securities	$	188,082	$	172	$	(2,221	)	$	186,033
States of the U.S. and political subdivisions		59,415		3		(1,661	)		57,757
Mortgage-backed GSE securities: residential		100,602		50		(1,158	)		99,494
Total	$	348,099	$	225	$	(5,040	)	$	343,284

Components of Held to Maturity Securities Portfolio

Components of held to maturity securities portfolio are as follows:

	June 30, 2017
			Gross		Gross
	Amortized		unrecognized		unrecognized			Fair
	cost		gains		losses			value
	(Dollars in thousands)
Held to maturity
Mortgage-backed GSE securities: residential	$	79,318	$	—	$	(892	)	$	78,426
States of the U.S. and political subdivisions		9,241		109		(1	)		9,349
Total	$	88,559	$	109	$	(893	)	$	87,775

	December 31, 2016
			Gross		Gross
	Amortized		unrecognized		unrecognized			Fair
	cost		gains		losses			value
	(Dollars in thousands)
Held to maturity
Mortgage-backed GSE securities: residential	$	85,065	$	—	$	(1,300	)	$	83,765
States of the U.S. and political subdivisions		12,454		17		(86	)		12,385
Total	$	97,519	$	17	$	(1,386	)	$	96,150

Available For Sale Securities [Member]

Debt Securities by Contractual Maturity

Debt securities available for sale by contractual maturity, repricing or expected call date are shown below:

	June 30, 2017
	Amortized cost		Fair value
	(Dollars in thousands)
Due in one year or less	$	—	$	—
Due after one year through five years		4,594		4,579
Due after five years through ten years		130,641		130,447
Due after ten years		58,697		58,401
Mortgage-backed GSE securities: residential		94,173		93,752
Total	$	288,105	$	287,179

Securities Available for Sale and Held to Maturity in Unrealized and Unrecognized Loss Position

Securities available for sale that have been in an unrealized loss position for less than twelve months or twelve months or more at June 30, 2017 are as follows:

	June 30, 2017
	Less than 12 months					12 months or more				Total
	Fair		Unrealized loss			Fair		Unrealized		Fair		Unrealized
	value		Loss			value		Loss		value		Loss
	(Dollars in thousands)
Description of securities:
U.S. Treasury and government sponsored entities	$	74,259	$	(490	)	$	—	$	—	$	74,259	$	(490	)
States of the U.S. and political subdivisions		37,694		(675	)		—		—		37,694		(675	)
Mortgage-backed GSE securities: residential		71,176		(512	)		—		—		71,176		(512	)
Total temporarily impaired securities	$	183,129	$	(1,677	)	$	—	$	—	$	183,129	$	(1,677	)

Securities available for sale that have been in an unrealized loss position for less than twelve months or twelve months or more at December 31, 2016 are as follows:

	December 31, 2016
	Less than 12 months					12 months or more				Total
	Fair		Unrealized loss			Fair		Unrealized		Fair		Unrealized
	value		Loss			value		Loss		value		Loss
	(Dollars in thousands)
Description of securities:
U.S. Treasury and government sponsored entities	$	171,411	$	(2,221	)	$	—	$	—	$	171,411	$	(2,221	)
States of the U.S. and political subdivisions		53,283		(1,661	)		—		—		53,283		(1,661	)
Mortgage-backed GSE securities: residential		98,775		(1,158	)		—		—		98,775		(1,158	)
Total temporarily impaired securities	$	323,469	$	(5,040	)	$	—	$	—	$	323,469	$	(5,040	)

Held To Maturity Securities [Member]

Debt Securities by Contractual Maturity

Debt securities held to maturity by contractual maturity, repricing or expected call date are shown below:

	June 30, 2017
	Amortized cost		Fair value
	(Dollars in thousands)
Due in one year or less	$	—	$	—
Due after one year through five years		—		—
Due after five years through ten years		7,290		7,375
Due after ten years		1,951		1,974
Mortgage-backed GSE securities: residential		79,318		78,426
Total	$	88,559	$	87,775

Securities Available for Sale and Held to Maturity in Unrealized and Unrecognized Loss Position

Securities held to maturity that have been in an unrecognized loss position for less than twelve months or twelve months or more are as follows:

	June 30, 2017
	Less than 12 months					12 months or more					Total
	Fair		Unrealized loss			Fair		Unrealized			Fair		Unrealized
	value		Loss			value		Loss			value		Loss
	(Dollars in thousands)
Description of securities:
Mortgage-backed GSE securities: residential	$	53,519	$	(934	)	$	24,907	$	(1,089	)	$	78,426	$	(2,023	)
States of the U.S. and political subdivisions		962		(1	)		—		—			962		(1	)
Total temporarily impaired securities	$	54,481	$	(935	)	$	24,907	$	(1,089	)	$	79,388	$	(2,024	)
	December 31, 2016
	Less than 12 months					12 months or more					Total
	Fair		Unrealized loss			Fair		Unrealized			Fair		Unrealized
	value		Loss			value		Loss			value		Loss
	(Dollars in thousands)
Description of securities:
Mortgage-backed GSE securities: residential	$	57,340	$	(1,243	)	$	26,426	$	(1,287	)	$	83,766	$	(2,530	)
States of the U.S. and political subdivisions		7,416		(86	)							7,416		(86	)
Total temporarily impaired securities	$	64,756	$	(1,329	)	$	26,426	$	(1,287	)	$	91,182	$	(2,616	)

XML

LOANS (Tables)

6 Months Ended

Jun. 30, 2017

Receivables [Abstract]

Schedule of Portfolio of Loans

Portfolio loans consist of the following:

	June 30,			December 31,
	2017			2016
	(Dollars in thousands)
Commercial loans
Multifamily	$	121,565		$	93,597
Nonresidential		342,300			231,401
Land		10,867			8,373
Construction		96,765			68,158
Secured		162,109			95,343
Unsecured		8,649			7,386
Total commercial loans		742,255			504,258
Residential mortgage loans
One-to four-family		834,349			762,926
Construction		56,946			35,695
Total residential mortgage loans		891,295			798,621
Consumer loans
Home equity		187,762			165,054
Auto		50,389			39,609
Marine		1,601			1,796
Recreational vehicle		6,401			7,602
Other		4,998			2,537
Total consumer loans		251,151			216,598
Total loans		1,884,701			1,519,477
Less:
Allowance for loan losses		19,660			19,087
Deferred loan costs, net		(4,054	)		(3,187	)
Total		15,606			15,900
Loans, net	$	1,869,095		$	1,503,577

Investment in Loans by Portfolio Segment and Based on Impairment

The following tables present the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and are based on impairment method as of June 30, 2017 and December 31, 2016 and activity for the three and six months ended June 30, 2017 and 2016.

Allowance For Loan Losses

	Commercial Loans			Residential Loans			Consumer Loans			Total
	(Dollars in thousands)
For the three months ended June 30, 2017
Beginning balance	$	10,182		$	5,912		$	2,876		$	18,970
Provision		503			295			44			842
Charge-offs		(12	)		(273	)		(150	)		(435	)
Recoveries		148			34			101			283
Ending balance	$	10,821		$	5,968		$	2,871		$	19,660
For the six months ended June 30, 2017
Beginning balance	$	10,824		$	5,538		$	2,725		$	19,087
Provision (recovery)		1,025			865			427			2,317
Charge-offs		(1,323	)		(503	)		(479	)		(2,305	)
Recoveries		295			68			198			561
Ending balance	$	10,821		$	5,968		$	2,871		$	19,660
June 30, 2017
Period-end amount allocated to:
Loans individually evaluated for impairment	$	5		$	1,171		$	440			1,616
Loans collectively evaluated for impairment		10,816			4,797			2,431			18,044
Loans acquired with deteriorated credit quality		—			—			—			—
Ending balance	$	10,821		$	5,968		$	2,871		$	19,660
Period-end balances:
Loans individually evaluated for impairment		2,532			16,190			7,588			26,310
Loans collectively evaluated for impairment		738,502			875,105			243,563			1,857,170
Loans acquired with deteriorated credit quality		1,221			—			—			1,221
Ending balance	$	742,255		$	891,295		$	251,151		$	1,884,701

Allowance For Loan Losses

	Commercial Loans			Residential Loans			Consumer Loans			Total
For the three months ended June 30, 2016
Beginning balance	$	8,521		$	5,736		$	2,646		$	16,903
Provision (recovery)		489			(33	)		(61	)		395
Charge-offs		(147	)		(84	)		(276	)		(507	)
Recoveries		95			25			261			381
Ending balance	$	8,958		$	5,644		$	2,570		$	17,172
For the six months ended June 30, 2016
Beginning balance	$	8,077		$	6,630		$	3,005		$	17,712
Provision (recovery)		3,213			(627	)		(36	)		2,550
Charge-offs		(2,493	)		(446	)		(755	)		(3,694	)
Recoveries		161			87			356			604
Ending balance	$	8,958		$	5,644		$	2,570		$	17,172
December 31, 2016
Period-end amount allocated to:
Loans individually evaluated for impairment	$	1,271		$	1,245		$	500		$	3,016
Loans collectively evaluated for impairment		9,553			4,293			2,225			16,071
Ending balance	$	10,824		$	5,538		$	2,725		$	19,087
Period-end balances:
Loans individually evaluated for impairment	$	6,018		$	17,485		$	8,045		$	31,548
Loans collectively evaluated for impairment		498,240			781,136			208,553			1,487,929
Ending balance	$	504,258		$	798,621		$	216,598		$	1,519,477

Presentation of Loans Individually Evaluated for Impairment by Class

The following table presents loans individually evaluated for impairment by class of loans as of and for six months ended June 30, 2017:

Impaired Loans

(Dollars in thousands)

	Unpaid Principal Balance		Recorded Investment		Allowance for Loan Losses Allocated		Average Recorded Investment		Interest Income Recognized		Cash Basis Income Recognized
With no specific allowance recorded
Commercial loans
Multifamily	$	470	$	413	$	—	$	277	$	3	$	3
Nonresidential		2,030		1,464		—		1,040		50		49
Land		3,922		9		—		17		—		—
Construction		3,593		—		—		—		—		—
Secured		242		190		—		190		—		—
Unsecured		500		—		—		—		—		—
Total commercial loans		10,757		2,076		—		1,524		53		52
Residential mortgage loans
One-to four-family		7,704		5,762		—		6,095		50		41
Construction		—		—		—		—		—		—
Total residential mortgage loans		7,704		5,762		—		6,095		50		41
Consumer loans
Home equity		1,965		1,535		—		1,577		8		7
Auto		34		18		—		11		—		—
Marine		540		169		—		210		—		—
Recreational vehicle		560		152		—		164		5		5
Other		—		—		—		—		—		—
Total consumer loans		3,099		1,874		—		1,962		13		12
Total	$	21,560	$	9,712	$	—	$	9,581	$	116	$	105
With a specific allowance recorded
Commercial loans
Multifamily	$	—	$	—	$	—	$	—	$	—	$	—
Nonresidential		501		456		5		2,164		12		11
Land		—		—		—		—		—		—
Construction		—		—		—		—		—		—
Secured		—		—		—		57		—		—
Unsecured		—		—		—		—		—		—
Total commercial loans		501		456		5		2,221		12		11
Residential mortgage loans
One-to four-family		10,526		10,428		1,171		10,764		273		229
Construction		—		—		—		—		—		—
Total residential mortgage loans		10,526		10,428		1,171		10,764		273		229
Consumer loans
Home equity		4,973		4,919		377		5,212		151		134
Auto		—		—		—		—		—		—
Marine		104		104		1		106		3		3
Recreational vehicle		702		691		62		681		14		13
Other		—		—		—		—		—		—
Total consumer loans		5,779		5,714		440		5,999		168		150
Total		16,806		16,598		1,616		18,984		453		390
Total impaired loans	$	38,366	$	26,310	$	1,616	$	28,565	$	569	$	495

The following table presents loans individually evaluated for impairment by class of loans as of and for six months ended June 30, 2016:

Impaired Loans

(Dollars in thousands)

	Unpaid Principal Balance		Recorded Investment		Allowance for Loan Losses Allocated		Average Recorded Investment		Interest Income Recognized		Cash Basis Income Recognized
With no specific allowance recorded
Commercial loans
Multifamily	$	95	$	—	$	—	$	—	$	—	$	—
Nonresidential		1,382		326		—		281		3		3
Land		3,922		384		—		384		—		—
Construction		3,594		—		—		—		—		—
Secured		3,745		3,700		—		3,700		—		—
Unsecured		1,118		—		—		—		—		—
Total commercial loans		13,856		4,410		—		4,365		3		3
Residential mortgage loans
One-to four-family		8,102		6,522		—		6,156		52		42
Construction		—		—		—		—		—		—
Total residential mortgage loans		8,102		6,522		—		6,156		52		42
Consumer loans
Home equity		1,858		1,339		—		1,463		4		4
Auto		16		9		—		11		—		—
Marine		544		302		—		292		—		—
Recreational vehicle		518		273		—		213		2		2
Other		4		4		—		3		—		—
Total consumer loans		2,940		1,927		—		1,982		6		6
Total	$	24,898	$	12,859	$	—	$	12,503	$	61	$	51
With a specific allowance recorded
Commercial loans
Multifamily	$	—	$	—	$	—	$	—	$	—	$	—
Nonresidential		10,854		8,571		922		7,493		124		122
Land		—		—		—		—		—		—
Construction		—		—		—		—		—		—
Secured		1,027		933		93		739		—		—
Unsecured		—		—		—		—		—		—
Total commercial loans		11,881		9,504		1,015		8,232		124		122
Residential mortgage loans
One-to four-family		12,033		12,033		1,333		12,742		297		251
Construction		—		—		—		—		—		—
Total residential mortgage loans		12,033		12,033		1,333		12,742		297		251
Consumer loans
Home equity		6,279		6,279		447		6,791		188		167
Auto		—		—		—		—		—		—
Marine		156		156		4		159		4		4
Recreational vehicle		793		793		85		868		15		14
Other		—		—		—		3		—		—
Total consumer loans		7,228		7,228		536		7,821		207		185
Total		31,142		28,765		2,884		28,795		628		558
Total impaired loans	$	56,040	$	41,624	$	2,884	$	41,298	$	689	$	609

The following table presents loans individually evaluated for impairment by class of loans as of December 31, 2016:

Impaired Loans

(Dollars in thousands)

	Unpaid Principal Balance		Recorded Investment		Allowance for Loan Losses Allocated
With no specific allowance recorded
Commercial loans
Multifamily	$	55	$	—	$	—
Nonresidential		2,278		1,489		—
Land		3,922		34		—
Construction		3,594		—		—
Secured		242		190		—
Unsecured		713		—		—
Total commercial loans		10,804		1,713		—
Residential mortgage loans
One-to four-family		8,736		6,758		—
Construction		—		—		—
Total residential mortgage loans		8,736		6,758		—
Consumer loans
Home equity		2,159		1,583		—
Auto		11		3		—
Marine		585		267		—
Recreational vehicle		433		120		—
Other		—		—		—
Total consumer loans		3,188		1,973		—
Total	$	22,728	$	10,444	$	—
With a specific allowance recorded
Commercial loans
Multifamily	$	—	$	—	$	—
Nonresidential		6,930		4,133		1,193
Land		—		—		—
Construction		—		—		—
Secured		237		172		78
Unsecured		—		—		—
Total commercial loans		7,167		4,305		1,271
Residential mortgage loans
One-to four-family		10,810		10,727		1,245
Construction		—		—		—
Total residential mortgage loans		10,810		10,727		1,245
Consumer loans
Home equity		5,390		5,335		426
Auto		—		—		—
Marine		108		108		1
Recreational vehicle		639		629		73
Other		—		—		—
Total consumer loans		6,137		6,072		500
Total		24,114		21,104		3,016
Total impaired loans	$	46,842	$	31,548	$	3,016

The following table presents loans individually evaluated for impairment by class of loans as of and for the three months ended June 30, 2017:

	Average Recorded Investment		Interest Income Recognized		Cash Basis Income Recognized
With no specific allowance recorded
Commercial loans
Multifamily	$	416	$	—	$	—
Nonresidential		815		25		25
Land		9		—		—
Construction		—		—		—
Secured		190		—		—
Unsecured		—		—		—
Total commercial loans		1,430		25		25
Residential mortgage loans
One-to four-family		5,763		20		20
Construction		—		—		—
Total residential mortgage loans		5,763		20		20
Consumer loans
Home equity		1,574		3		3
Auto		16		—		—
Marine		182		—		—
Recreational vehicle		186		2		2
Other				—		—
Total consumer loans		1,958		5		5
Total	$	9,151	$	50	$	50
With a specific allowance recorded
Commercial loans
Multifamily	$	—	$	—	$	—
Nonresidential		1,179		5		5
Land		—		—		—
Construction		—		—		—
Secured				—		—
Unsecured		—		—		—
Total commercial loans		1,179		5		5
Residential mortgage loans
One-to four-family		10,783		114		111
Construction		—		—		—
Total residential mortgage loans		10,783		114		111
Consumer loans
Home equity		5,151		66		66
Auto		—		—		—
Marine		105		1		1
Recreational vehicle		708		7		6
Other		—		—		—
Total consumer loans		5,964		74		73
Total		17,926		193		189
Total impaired loans	$	27,077	$	243	$	239

The following table presents loans individually evaluated for impairment by class of loans as of and for the three months ended June 30, 2016:

	Average Recorded Investment		Interest Income Recognized		Cash Basis Income Recognized
With no specific allowance recorded
Commercial loans
Multifamily	$	—	$	—	$	—
Nonresidential		269		1		1
Land		384		—
Construction		—		—		—
Secured		3,700		—		—
Unsecured		—		—		—
Total commercial loans		4,353		1		1
Residential mortgage loans
One-to four-family		6,302		17		17
Construction		—		—		—
Total residential mortgage loans		6,302		17		17
Consumer loans
Home equity		1,336		1		1
Auto		9		—		—
Marine		303		—		—
Recreational vehicle		281		1		1
Other		4		—		—
Total consumer loans		1,933		2		2
Total	$	12,588	$	20	$	20
With a specific allowance recorded
Commercial loans
Multifamily	$	—	$	—	$	—
Nonresidential		8,748		15		15
Land		—		—		—
Construction		—		—		—
Secured		947		—		—
Unsecured		—		—		—
Total commercial loans		9,695		15		15
Residential mortgage loans
One-to four-family		12,372		124		122
Construction		—		—		—
Total residential mortgage loans		12,372		124		122
Consumer loans
Home equity		6,568		84		82
Auto		—		—		—
Marine		158		2		2
Recreational vehicle		741		8		8
Other		—		—		—
Total consumer loans		7,467		94		92
Total		29,534		233		229
Total impaired loans	$	42,122	$	253	$	249

Loans in Process of Foreclosure

The table below presents loans that are in the process of foreclosure at June 30, 2017 and December 31, 2016, but legal title, deed in lieu of foreclosure or similar legal agreement to the property has not yet been obtained:

	June 30, 2017				December 31, 2016
	Unpaid Principal Balance		Recorded Investment		Unpaid Principal Balance		Recorded Investment
	(Dollars in thousands)				(Dollars in thousands)
Mortgage loans in process of foreclosure	$	3,188	$	2,816	$	3,025	$	2,576
Consumer loans in process of foreclosure		931		751		1,069		795

Presentation of Recorded Investment in Nonaccrual Loans and Loans Past Due Over 90 Days and Still on Accrual by Class of Loans

The following table presents the recorded investment in nonaccrual loans and loans past due over 90 days and still on accrual by class of loans as of June 30, 2017:

Nonaccrual Loans and Loans Past Due Over 90 Days and Still Accruing

As of June 30, 2017

	Nonaccrual		Loans past due over 90 days and still accruing
	(Dollars in thousands)
Commercial loans
Multifamily	$	413	$	—
Nonresidential		1,331		—
Land		9		—
Construction		—		—
Secured		190		—
Unsecured		—		—
Total commercial loans		1,943		—
Residential mortgage loans
One-to four-family		6,701		—
Construction		—		—
Total residential mortgage loans		6,701		—
Consumer Loans
Home equity		1,707		—
Auto		94		—
Marine		169		—
Recreational vehicle		166		—
Other		1		2
Total consumer loans		2,137		2
Total nonaccrual loans and loans past due over 90 days and still accruing	$	10,781	$	2

The following table presents the recorded investment in nonaccrual loans and loans past due over 90 days and still on accrual by class of loans as of December 31, 2016:

Nonaccrual Loans and Loans Past Due Over 90 Days and Still Accruing

As of December 31, 2016

	Nonaccrual		Loans past due over 90 days and still accruing
	(Dollars in thousands)
Commercial loans
Multifamily	$	—	$	—
Nonresidential		3,546		—
Land		34		—
Construction		—		—
Secured		361		—
Unsecured		—		—
Total commercial loans		3,941		—
Residential mortgage loans
One-to four-family		6,084		—
Construction		—		—
Total residential mortgage loans		6,084		—
Consumer Loans
Home equity		1,936		—
Auto		31		—
Marine		267		—
Recreational vehicle		178		—
Other		2		—
Total consumer loans		2,414		—
Total nonaccrual loans and loans past due over 90 days and still accruing	$	12,439	$	—

Presentation of Age Analysis of Past-Due Loans, Segregated by Class of Loans

The following table presents an age analysis of past-due loans, segregated by class of loans as of June 30, 2017:

Past Due Loans

(Dollars in thousands)

	30-59 Days Past Due		60-89 Days Past Due		Greater than 90 Days Past Due		Total Past Due		Current Loans		Total Loans
Commercial loans
Multifamily	$	—	$	187	$	—	$	187	$	121,378	$	121,565
Nonresidential		199		—		153		352		341,948		342,300
Land		—		—		9		9		10,858		10,867
Construction		—		—		—		—		96,765		96,765
Secured		135		22		189		346		161,763		162,109
Unsecured		—		—		—		—		8,649		8,649
Total commercial loans		334		209		351		894		741,361		742,255
Residential mortgage loans
One-to four-family		2,643		1,584		5,646		9,873		824,476		834,349
Construction		—		—		—		—		56,946		56,946
Total residential mortgage loans		2,643		1,584		5,646		9,873		881,422		891,295
Consumer Loans:
Home equity		1,141		113		1,429		2,683		185,079		187,762
Automobile		123		119		17		259		50,130		50,389
Marine		—		—		169		169		1,432		1,601
Recreational vehicle		199		149		95		443		5,958		6,401
Other		2		4		3		9		4,989		4,998
Total consumer loans		1,465		385		1,713		3,563		247,588		251,151
Total loans	$	4,442	$	2,178	$	7,710	$	14,330	$	1,870,371	$	1,884,701

The following table presents an age analysis of past-due loans, segregated by class of loans as of December 31, 2016:

Past Due Loans

(Dollars in thousands)

	30-59 Days Past Due		60-89 Days Past Due		Greater than 90 Days Past Due		Total Past Due		Current Loans		Total Loans
Commercial loans
Multifamily	$	—	$	—	$	—	$	—	$	93,597	$	93,597
Nonresidential		3,511		—		61		3,572		227,829		231,401
Land		—		—		34		34		8,339		8,373
Construction		—		—		—		—		68,158		68,158
Secured		—		—		361		361		94,982		95,343
Unsecured		—		—		—		—		7,386		7,386
Total commercial loans		3,511		—		456		3,967		500,291		504,258
Residential mortgage loans
One-to four-family		3,774		1,717		5,461		10,952		751,974		762,926
Construction		—		—		—		—		35,695		35,695
Total residential mortgage loans		3,774		1,717		5,461		10,952		787,669		798,621
Consumer Loans:
Home equity		941		458		1,669		3,068		161,986		165,054
Automobile		130		—		3		133		39,476		39,609
Marine		—		—		267		267		1,529		1,796
Recreational vehicle		131		347		—		478		7,124		7,602
Other		1		3		2		6		2,531		2,537
Total consumer loans		1,203		808		1,941		3,952		212,646		216,598
Total loans	$	8,488	$	2,525	$	7,858	$	18,871	$	1,500,606	$	1,519,477

Loans by Class Modified as Troubled Debt Restructurings

The following table presents loans by class modified as troubled debt restructurings that occurred during the six months ended June 30, 2017:

	Number of Loans		Pre-Modification Outstanding Recorded Investment		Post-Modification Recorded Investment
			(In thousands)
Commercial loans
Multifamily		—	$	—	$	—
Nonresidential
Land		—		—		—
Construction		—		—		—
Secured		—		—		—
Unsecured		—		—		—
Total commercial loans		—		—		—
Residential mortgage loans
One-to four-family		1		75		84
Construction		—		—		—
Total residential mortgage loans		1		75		84
Consumer loans
Home equity		—		—		—
Auto		—		—		—
Marine		—		—		—
Recreational vehicle		1		115		115
Other		—		—		—
Total consumer loans		1		115		115
Total restructured loans		2	$	190	$	199

The following table presents loans by class modified as troubled debt restructurings that occurred during the three months ended June 30, 2016:

	Number of Loans		Pre-Modification Outstanding Recorded Investment		Post-Modification Recorded Investment
			(Dollars in thousands)
Commercial loans
Multifamily		—	$	—	$	—
Nonresidential		1		4,000		4,000
Land		—		—		—
Construction		—		—		—
Secured		—		—		—
Unsecured		—		—		—
Total commercial loans		1		4,000		4,000
Residential mortgage loans
One-to four-family		1		97		98
Construction		—		—		—
Total residential mortgage loans		1		97		98
Consumer loans
Home equity		2		110		114
Auto		—		—		—
Marine		—		—		—
Recreational vehicle		—		—		—
Other		—		—		—
Total consumer loans		2		110		114
Total restructured loans		4	$	4,207	$	4,212

The following table presents loans by class modified as troubled debt restructurings that occurred during the six months ended June 30, 2016:

	Number of Loans		Pre-Modification Outstanding Recorded Investment		Post-Modification Recorded Investment
			(Dollars in thousands)
Commercial loans
Multifamily		—	$	—	$	—
Nonresidential		2		4,088		4,088
Land		—		—		—
Construction		—		—		—
Secured		—		—		—
Unsecured		—		—		—
Total commercial loans		2		4,088		4,088
Residential mortgage loans
One-to four-family		3		316		335
Construction		—		—		—
Total residential mortgage loans		3		316		335
Consumer loans
Home equity		3		130		134
Auto		—		—		—
Marine		—		—		—
Recreational vehicle		—		—		—
Other		—		—		—
Total consumer loans		3		130		134
Total restructured loans		8	$	4,534	$	4,557

Loans by Class Modified as Troubled Debt Restructurings with Payment Default

The following table presents loans by class modified as troubled debt restructurings for which there was a payment default within a twelve-month cycle following the modification during the period ended June 30, 2017.

	Number of loans		Recorded Investment
			(Dollars in thousands)
Commercial loans
Multifamily		—	$	—
Nonresidential		—		—
Land		—		—
Construction		—		—
Secured		—		—
Unsecured		—		—
Total commercial loans		—		—
Residential mortgage loans
One-to four-family		1		164
Construction		—		—
Total residential mortgage loans		1		164
Consumer loans
Home equity		1		47
Auto		—		—
Marine		—		—
Recreational vehicle		—		—
Other		—		—
Total consumer loans		1		47
Total restructured loans		2	$	211

The following table presents loans by class modified as troubled debt restructurings for which there was a payment default within a twelve month cycle following the modification during the period ended June 30, 2016:

	Number of loans		Recorded Investment
			(Dollars in thousands)
Commercial loans
Multifamily		—	$	—
Nonresidential		—		—
Land		—		—
Construction		—		—
Secured		—		—
Unsecured		—		—
Total commercial loans		—		—
Residential mortgage loans
One-to four-family		—		—
Construction		—		—
Total residential mortgage loans		—		—
Consumer loans
Home equity		—		—
Auto		—		—
Marine		—		—
Recreational vehicle		—		—
Other		—		—
Total consumer loans		—		—
Total restructured loans		—	$	—

Risk Category of Loans by Class of Loans

As of June 30, 2017 and December 31, 2016, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:

Loans

June 30, 2017

(Dollars in thousands)

	Unclassified				Classified
	Unclassified		Special Mention		Substandard		Doubtful		Loss		Total Classified		Total Loans
Commercial Loans
Multifamily	$	117,375	$	3,482	$	708	$	—	$	—	$	708	$	121,565
Nonresidential		333,010		3,208		6,082		—		—		6,082		342,300
Land		10,858		—		9		—		—		9		10,867
Construction		96,362		403		—		—		—		—		96,765
Secured		134,433		10,839		16,837		—		—		16,837		162,109
Unsecured		8,555		—		94		—		—		94		8,649
Total commercial loans		700,593		17,932		23,730		—		—		23,730		742,255
Residential mortgage loans
One-to four-family		825,270		779		8,300		—		—		8,300		834,349
Construction		56,946		—		—		—		—		—		56,946
Total residential mortgage loans		882,216		779		8,300		—		—		8,300		891,295
Consumer Loans
Home equity		186,055		—		1,707		—		—		1,707		187,762
Auto		50,258		—		131		—		—		131		50,389
Marine		1,432		—		169		—		—		169		1,601
Recreational vehicle		6,234		—		167		—		—		167		6,401
Other		4,997		—		1		—		—		1		4,998
Total consumer loans		248,976		—		2,175		—		—		2,175		251,151
Total loans	$	1,831,785	$	18,711	$	34,205	$	—	$	—	$	34,205	$	1,884,701

Loans

December 31, 2016

(Dollars in thousands)

	Unclassified				Classified
	Unclassified		Special Mention		Substandard		Doubtful		Loss		Total Classified		Total Loans
Commercial Loans
Multifamily	$	89,468	$	3,564	$	565	$	—	$	—	$	565	$	93,597
Nonresidential		217,204		6,037		8,160		—		—		8,160		231,401
Land		8,339		—		34		—		—		34		8,373
Construction		68,158		—		—		—		—		—		68,158
Secured		89,756		3,420		2,167		—		—		2,167		95,343
Unsecured		7,291		—		95		—		—		95		7,386
Total commercial loans		480,216		13,021		11,021		—		—		11,021		504,258
Residential mortgage loans
One-to four-family		754,996		104		7,826		—		—		7,826		762,926
Construction		35,695		—		—		—		—		—		35,695
Total residential mortgage loans		790,691		104		7,826		—		—		7,826		798,621
Consumer Loans
Home equity		163,101		—		1,953		—		—		1,953		165,054
Auto		39,577		1		31		—		—		31		39,609
Marine		1,530		—		266		—		—		266		1,796
Recreational vehicle		7,424		—		178		—		—		178		7,602
Other		2,535		—		2		—		—		2		2,537
Total consumer loans		214,167		1		2,430		—		—		2,430		216,598
Total loans	$	1,485,074	$	13,126	$	21,277	$	—	$	—	$	21,277	$	1,519,477

Schedule of Purchased Credit Impaired Loans for which Payments Would Not be Collected

The carrying amount of those loans is as follows:

	June 30, 2017
	(Dollars in thousands)
Commercial loans	$	1,221
Residential mortgage loans		—
Consumer loans		—
Outstanding balance	$	1,221
Carrying amount, net of allowance of $0	$	1,221

Accretable Yield or Income Expected to be Collected

Accretable yield, or income expected to be collected, is as follows:

	Three Months Ended		Six Months Ended
	June 30, 2017		June 30, 2017
			(Dollars in thousands)
Beginning of period	$	128	$	—
New loans purchased		—		158
Accretion of income		12		42
Balance at June 30	$	116	$	116

Schedule of Purchased Credit Impaired Loans Purchased at Acquisition

Purchased credit impaired loans purchased during the six months ended June 30, 2017 for which it was probable at acquisition that all contractually required payments would not be collected are as follows:

	June 30, 2017
	(Dollars in thousands)
Contractually required payments receivable of   loans purchased during the year:
Commercial loans	$	4,499
Residential mortgage loans		—
Consumer loans		—
	$	4,499
Cash flow expected to be collected at acquisition	$	1,955
Fair value of acquired loans at acquisition		1,797

Carrying Amount of Purchased Credit Impaired Loans

Income is not recognized on purchased credit impaired loans if the Company cannot reasonably estimate cash flows expected to be collected.  The carrying amounts of such loans are as follows:

	June 30, 2017
	(Dollars in thousands)
Loans at beginning of year	$	—
Loans purchased during the year		1,797
Loans at end of period		1,221

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MORTGAGE BANKING ACTIVITIES (Tables)

6 Months Ended

Jun. 30, 2017

Mortgage Banking [Abstract]

Principal Balances of Mortgage Servicing Rights

The principal balances of mortgage loans serviced for others are as follows:

	June 30, 2017		December 31, 2016
	(Dollars in thousands)
Mortgage loan portfolios serviced for:
FHLMC	$	963,748	$	956,278
FNMA		213,848		208,114
Private investor		27,917		—

Capitalized Mortgage Servicing Rights

Activity for capitalized mortgage servicing rights, included in other assets, was as follows:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2017			2016			2017			2016
	(Dollars in thousands)
Balance, beginning of period	$	5,977		$	5,727		$	6,070		$	5,686
Originations		670			653			1,026			1,162
Amortized to expense		(486	)		(567	)		(935	)		(1,035	)
Balance, end of period		6,161			5,813			6,161			5,813
Less valuation allowance		(5	)		(766	)		(5	)		(766	)
Net balance	$	6,156		$	5,047		$	6,156		$	5,047

Valuation Allowance for Mortgage Servicing Rights

Activity in the valuation allowance for mortgage servicing rights was as follows:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2017			2016			2017			2016
	(Dollars in thousands)
Balance, beginning of period	$	(3	)	$	(474	)	$	—		$	(39	)
Impairment charges		(2	)		(292	)		(5	)		(727	)
Recoveries		—			—			—			—
Balance, end of period	$	(5	)	$	(766	)	$	(5	)	$	(766	)

Key Economic Assumptions in Measuring Value of Mortgage Servicing Rights

Key economic assumptions in measuring the value of mortgage servicing rights at June 30, 2017, and December 31, 2016, were as follows:

	June 30, 2017		December 31, 2016
Weighted average prepayment rate	178 PSA		165 PSA
Weighted average life (in years)	6.38		6.64
Weighted average discount rate		9.06%		9.00%

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OTHER REAL ESTATE OWNED AND OTHER REPOSSESSED ASSETS (Tables)

6 Months Ended

Jun. 30, 2017

Real Estate [Abstract]

Real Estate Owned and Other Repossessed Assets

Real estate owned and other repossessed assets at June 30, 2017 and December 31, 2016 were as follows:

	June 30, 2017			December 31, 2016
	(Dollars in thousands)
Real estate owned and other repossessed assets	$	1,586		$	2,789
Valuation allowance		(389	)		(1,012	)
End of period	$	1,197		$	1,777

Valuation Allowance Related to Real Estate Owned

Activity in the valuation allowance was as follows:

	Three Months Ended						Six Months Ended
	June 30, 2017			June 30, 2016			June 30, 2017			June 30, 2016
	(Dollars in thousands)
Beginning of period	$	549		$	1,124		$	1,012		$	1,229
Recovery of expense		—			(27	)		(38	)		(26	)
Reductions due to sales		(160	)		(96	)		(585	)		(202	)
End of period	$	389		$	1,001		$	389		$	1,001

Expenses Related to Foreclosed and Repossessed Assets

Expenses related to foreclosed and repossessed assets include:

	Three Months Ended					Six Months Ended
	June 30, 2017		June 30, 2016			June 30, 2017			June 30, 2016
	(Dollars in thousands)
Net loss on sales	$	18	$	90		$	108		$	102
Provision for unrealized (gains) losses , net		—		(27	)		(38	)		(26	)
Operating expenses, net of rental income		23		77			85			149
Total expenses	$	41	$	140		$	155		$	225

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FAIR VALUE MEASUREMENT (Tables)

6 Months Ended

Jun. 30, 2017

Assets and Liabilities Measured at Fair Value on Recurring Basis

Assets and Liabilities Measured on a Recurring Basis: Assets and liabilities measured at fair value on a recurring basis are summarized below:

			Fair Value Measurements at June 30, 2017 Using:
			Quoted
			Prices in
			Active		Significant
			Markets for		Other		Significant
			Identical		Observable		Unobservable
	June 30,		Assets		Inputs		Inputs
	2017		(Level 1)		(Level 2)		(Level 3)
	(Dollars in thousands)
Assets:
Available for sale securities
U.S. Treasury and government sponsored entities'    securities	$	134,603	$	—	$	134,603	$	—
States of the U.S. and political subdivisions		58,824		—		58,824
Mortgage-backed GSE securities: residential		93,752		—		93,752		—
Loans held for sale, at fair value		85,954		—		15,959		69,995
Purchased certificate of deposit option		746		—		746		—
Liabilities
Written certificate of deposit option		746		—		746		—

			Fair Value Measurements at December 31, 2016 Using:
			Quoted
			Prices in
			Active		Significant
			Markets for		Other		Significant
			Identical		Observable		Unobservable
	December 31,		Assets		Inputs		Inputs
	2016		(Level 1)		(Level 2)		(Level 3)
	(Dollars in thousands)
Assets:
Available for sale securities
U.S. Treasury and government sponsored entities'    securities	$	186,033	$	—	$	186,033	$	—
States of the U.S. and political subdivisions		57,757		—		57,757		—
Mortgage-backed GSE securities: residential		99,494		—		99,494		—
Loans held for sale, at fair value		62,593		—		8,832		53,761
Purchased certificate of deposit option		882		—		882		—
Liabilities
Written certificate of deposit option		882		—		882		—

Reconciliation of All Assets Measured at Fair Value on Recurring Basis Using Significant Unobservable Inputs (Level 3)

The table below presents a reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three and six months ended June 30, 2017 and 2016.  

	Loans Held for Sale, At Fair Value						Loans Held for Sale, At Fair Value
	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2017			2016			2017			2016
	(Dollars in thousands)
Balance of recurring Level 3 assets at beginning of period	$	67,439		$	26,760		$	53,761		$	26,716
Total gains (losses) for the period
Included in change in fair value of loans held for sale		1,822			622			2,412			1,291
Included in other comprehensive income					—						—
Originations/Draws on construction perm loans		25,945			19,132			51,245			35,819
Amortization					—						—
Sales		(25,211	)		(12,909	)		(37,423	)		(30,221	)
Balance of recurring Level 3 assets at end of period	$	69,995		$	33,605		$	69,995		$	33,605

Assets and Liabilities Measured at Fair Value on Non-recurring Basis

Assets and Liabilities Measured on a Non-Recurring Basis: Assets and liabilities measured at fair value on a non-recurring basis are summarized below:

			Fair Value Measurements at June 30, 2017 Using:
			Quoted
			Prices in
			Active		Significant
			Markets for		Other		Significant
			Identical		Observable		Unobservable
	June 30,		Assets		Inputs		Inputs
	2017		(Level 1)		(Level 2)		(Level 3)
	(Dollars in thousands)
Assets:
Impaired loans:
Commercial loans
Multifamily	$	418	$	—	$	—	$	418
Residential loans
One-to four-family residential		756		—		—		756
Consumer loans
Home Equity		28		—		—		28
Auto		17		—		—		17
Marine		169		—		—		169
Recreational vehicle		55		—		—		55
Mortgage servicing rights		82		—		82		—
Other real estate owned, net
Commercial loans
Construction loans		448		—		—		448
Residential loans
One-to four-family residential		35		—		—		35

			Fair Value Measurements at December 31, 2016 Using:
			Quoted
			Prices in
			Active		Significant
			Markets for		Other		Significant
			Identical		Observable		Unobservable
	December 31,		Assets		Inputs		Inputs
	2016		(Level 1)		(Level 2)		(Level 3)
	(Dollars in thousands)
Assets:
Impaired loans:
Commercial loans
Nonresidential	$	2,257	$	—	$	—	$	2,257
Secured		284		—		—		284
Residential loans
One-to four-family residential		919		—		—		919
Consumer loans
Home Equity		228		—		—		228
Auto		177		—		—		177
Recreational vehicle		89		—		—		89
Other real estate owned, net
Commercial loans
Construction loans		748		—		—		748
Residential loans
One-to four-family residential		281		—		—		281

Fair Value Option for Newly Originated Residential Mortgage and Permanent Construction Loans Held for Sale

The Company has elected the fair value option for newly originated residential mortgage and permanent construction loans held for sale.  These loans are intended for sale and the Company believes that fair value is the best indicator of the resolution of these loans.  Interest income is recorded based on the contractual terms of the loan and in accordance with the Company’s policy on loans held for investment.  None of these loans are 90 or more days past due nor on nonaccrual status as of June 30, 2017 and December 31, 2016.  

	June 30, 2017		December 31, 2016
	(Dollars in thousands)
Aggregate fair value	$	85,954	$	62,593
Contractual balance		83,304		62,843
Gain (loss)		2,650		(250	)

Amount of Gains and Losses from Changes in Fair Value Included in Earnings

The total amount of gains and losses from changes in fair value included in earnings for the three and six months ended June 30, 2017 and 2016 for loans held for sale, at fair value were:

	For the Three Months Ended				For the Six Months Ended
	June 30, 2017		June 30, 2016		June 30, 2017		June 30, 2016
	(Dollars in thousands)
Interest  income	$	—	$	—	$	—	$	—
Interest expense		—		—		—		—
Change in fair value		2,149		845		2,900		1,649
Total change in fair value	$	2,149	$	845	$	2,900	$	1,649

Carrying Value and Estimated Fair Values of Financial Instruments

In accordance with U.S. GAAP, the carrying value and estimated fair values of financial instruments at June 30, 2017 and December 31, 2016, were as follows:

				Fair Value Measurements at June 30, 2017 Using:
	June 30,
	2017
	Carrying Value			(Level 1)			(Level 2)			(Level 3)
	(Dollars in thousands)
Assets:
Cash and cash equivalents	$	52,014		$	52,014		$	—		$	—
Available for sale securities		287,179			—			287,179			—
Held to maturity securities		88,559			—			87,775			—
Loans held for sale		199			—			205			—
Loans held for sale, at fair value		85,954			—			15,959			69,995
Loans, net		1,869,095			—			—			1,864,169
FHLB stock		19,324		n/a			n/a			n/a
Accrued interest receivable		7,420			—			2,225			5,195
Purchased certificate of deposit option		746			—			746			—
Liabilities:
Deposits:
Checking, savings and money market accounts		(1,252,227	)		(1,252,227	)		—			—
Certificates of deposit		(641,766	)		—			(642,416	)		—
FHLB advances		(328,146	)		—			(328,151	)		—
Repurchase agreements and other		(8,045	)		—			(7,837	)		—
Advance payments by borrowers for taxes and insurance		(21,989	)		(21,989	)		—			—
Accrued interest payable		(392	)		—			(392	)		—
Written certificate of deposit option		(746	)		—			(746	)		—

				Fair Value Measurements at December 31, 2016 Using:
	December 31,
	2016
	Carrying Value			(Level 1)			(Level 2)			(Level 3)
	(Dollars in thousands)
Assets:
Cash and cash equivalents	$	45,887		$	45,887		$	—		$	—
Available for sale securities		343,284			—			343,284			—
Held to maturity securities		97,519			—			92,940			3,210
Loans held for sale at lower of cost or market		165			—			169			—
Loans held for sale, at fair value		62,593			—			8,832			53,761
Loans, net		1,503,577			—			—			1,494,534
FHLB stock		18,068		n/a			n/a			n/a
Accrued interest receivable		6,900			—			2,624			4,276
Purchased certificate of deposit option		882			—			882			—
Liabilities:
Deposits:
Checking, savings and money market accounts		(1,026,565	)		(1,026,565	)		—			—
Certificates of deposit		(488,426	)		—			(491,278	)		—
FHLB advances		(390,756	)		—			(390,750	)		—
Repurchase agreements and other		(512	)		—			(513	)		—
Advance payments by borrowers for taxes and insurance		(23,812	)		(23,812	)		—			—
Accrued interest payable		(145	)		—			(145	)		—
Written certificate of deposit option		(882	)		—			(882	)		—

Significant Unobservable Inputs (Level 3) [Member] | Fair Value, Measurements, Recurring [Member]

Quantitative Information About Level 3 Fair Value Measurements for Financial Instruments Measured at Fair Value

The following table presents quantitative information about recurring Level 3 fair value measurements at June 30, 2017:

			Valuation	Unobservable
	Fair Value		Technique(s)	Input(s)	Range
Loans held for sale, at fair value	$	69,995	Comparable sales	Time discount	0.00-1.80%

The following table presents quantitative information about recurring Level 3 fair value measurements at December 31, 2016:

			Valuation	Unobservable
	Fair Value		Technique(s)	Input(s)	Range
Loans held for sale, at fair value	$	53,761	Comparable sales	Time discount	0.00-1.80%

Significant Unobservable Inputs (Level 3) [Member] | Fair Value, Measurements, Nonrecurring [Member]

Quantitative Information About Level 3 Fair Value Measurements for Financial Instruments Measured at Fair Value

The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a nonrecurring basis at June 30, 2017:

	Fair Value		Valuation Technique(s)	Unobservable Input(s)	Range     (Weighted Average)
Impaired loans:
Commercial loans
Multi Family	$	418	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-35.00%  (15.00%)
Residential loans
One-to four-family residential		756	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-10.77%  (4.27%)
Consumer loans
Home Equity		28	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-17.85%  (8.93%)
Marine		169	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-37.00%  (37.00%)
Other real estate owned, net
Commercial loans
Construction loans		448	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-80.00%(24.03%)
Residential loans
One-to four-family residential		35	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-3.77%  (3.77%)

The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a nonrecurring basis at December 31, 2016:

	Fair Value		Valuation Technique(s)	Unobservable Input(s)	Range     (Weighted Average)
Impaired loans:
Commercial loans
Nonresidential	$	2,257	Sales comparison approach	Adjustment for differences between comparable sales	0.00-35.00%  (15.00%)
Secured		284	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-64.00%  (16.00%)
Residential loans
One-to four-family residential		919	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-10.77%  (4.27%)
Consumer loans
Home Equity		228	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-17.85%  (8.93%)
Other real estate owned:
Commercial loans
Construction loans		748	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-90.40%  (27.46%)
			Cost approach	Adjustment for differences in cost	0.00%-33.33%  (16.67%)
Residential loans
One-to four-family residential		281	Sales comparison approach	Adjustment for differences between comparable sales	0.00%-27.00%  (7.74%)

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STATEMENT OF CASH FLOWS SUPPLEMENTAL DISCLOSURE (Tables)

6 Months Ended

Jun. 30, 2017

Supplemental Cash Flow Elements [Abstract]

Supplemental Disclosures of Cash Flow Information

Supplemental disclosures of cash flow information are summarized below.

	For the Six Months Ended June 30,
	2017		2016
	(Dollars in thousands)
Supplemental disclosures of cash flow information
Cash paid  during the period for:
Interest on deposits and borrowings	$	5,396	$	4,166
Income taxes		250		150
Supplemental schedule of noncash activities:
Transfers from loans to real estate owned and other repossessed assets		282		534
Transfers from loans to loans held for sale		27,921		—
Transfers from premises and equipment to other assets, held for sale		1,720		—
Accretion of securities held to maturity		100		109
Issuance of common stock - James & Sons acquisition		—		1,508
Issuance of common stock - Ohio Legacy Corp. acquisition		25,816		—
Net assets acquired from Ohio Legacy Corp., excluding cash and cash equivalents		36		—

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EARNINGS PER SHARE (Tables)

6 Months Ended

Jun. 30, 2017

Earnings Per Share [Abstract]

Computation of Earnings Per Share

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2017			2016			2017			2016
	(Dollars in thousands, except per share data)
Net income per consolidated statements of income	$	8,189		$	5,330		$	9,727		$	8,650
Net income allocated to participating securities		(49	)		(40	)		(61	)		(55	)
Net income allocated to common stock	$	8,140		$	5,290		$	9,666		$	8,595
Basic earnings per common share computation:
Distributed earnings allocated to common stock	$	1,483		$	1,180		$	2,962		$	2,368
Undistributed earnings allocated to common stock		6,657			4,110			6,704			6,227
Net income allocated to common stock	$	8,140		$	5,290		$	9,666		$	8,595
Weighted average common shares outstanding, including shares    considered participating securities		49,691			47,223			49,158			47,405
Less: Average participating securities		(299	)		(354	)		(309	)		(299	)
Weighted average shares		49,392			46,869			48,849			47,106
Basic earnings per common share	$	0.16		$	0.11		$	0.20		$	0.18
Diluted earnings per common share computation:
Net income allocated to common stock	$	8,140		$	5,290		$	9,666		$	8,595
Weighted average common shares outstanding for basic    earnings per common share		49,392			46,869			48,849			47,106
Add: Dilutive effects of assumed exercises of stock options and LTIP    awards		403			248			398			247
Weighted average shares and dilutive potential common shares		49,795			47,117			49,247			47,353
Diluted earnings per common share	$	0.16		$	0.11		$	0.20		$	0.18

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OTHER COMPREHENSIVE INCOME (LOSS) (Tables)

6 Months Ended

Jun. 30, 2017

Equity [Abstract]

Other Comprehensive Income (Loss) Components and Related Tax Effects

Other comprehensive income (loss) components and related tax effects for the three-month periods are as follows:

	Unrealized Gains (Losses) on Securities Availablefor Sale			Disproportionate Tax Effect from Securities Available for Sale			Losses on Securities Transferred From Available for Sale to Held to Maturity			Total
June 30, 2017	(Dollars in thousands)
Balances at beginning of period, net of tax	$	(2,165	)	$	(17,110	)	$	(767	)	$	(20,042	)
Other comprehensive income before    reclassifications		1,758			—			—			1,758
Accretion of unrealized losses of securities    transferred from available for sale to    held to maturity recognized in other    comprehensive income		—			—			32			32
Reclassification adjustment for gains realized    in income		(196	)		—			—			(196	)
Net current period other comprehensive income		1,562			—			32			1,594
Balances at end of period, net of tax	$	(603	)	$	(17,110	)	$	(735	)	$	(18,448	)

	Unrealized Gains (Losses) on Securities Available for Sale			Disproportionate Tax Effect from Securities Available for Sale			Losses on Securities Transferred From Available for Sale to Held to Maturity			Unrealized Gains (Losses) from Postretirement Plan			Disproportionate Tax Effect from Postretirement Plan		Total
June 30, 2016	(Dollars in thousands)
Balances at beginning of period,    net of tax	$	3,937		$	(17,110	)	$	(926	)	$	650		$	511	$	(12,938	)
Other comprehensive income    before reclassifications		4,594			—			—			—			—		4,594
Amortization of unrealized gains    of postretirement plan    recognized in other    comprehensive income		—			—			—			(181	)		—		(181	)
Accretion of unrealized losses of    securities transferred from    available for sale to held    to maturity recognized in    other comprehensive income		—			—			37			—			—		37
Reclassification adjustment for    gains realized in income		(152	)		—			—			—			—		(152	)
Net current period other    comprehensive income		4,442			—			37			(181	)		—		4,298
Balances at end of period, net of    tax	$	8,379		$	(17,110	)	$	(889	)	$	469		$	511	$	(8,640	)

Other comprehensive income (loss) components and related tax effects for the six-month periods are as follows:

	Unrealized Gains (Losses) on Securities Availablefor Sale			Disproportionate Tax Effect from Securities Available for Sale			Losses on Securities Transferred From Available for Sale to Held to Maturity			Total
June 30, 2017	(Dollars in thousands)
Balances at beginning of period, net of tax	$	(3,130	)	$	(17,110	)	$	(800	)	$	(21,040	)
Other comprehensive income before    reclassifications		2,742			—			—			2,742
Accretion of unrealized losses of securities    transferred from available for sale to held    to maturity recognized in other    comprehensive income		—			—			65			65
Reclassification adjustment for gains realized    in income		(215	)		—			—			(215	)
Net current period other comprehensive    income		2,527			—			65			2,592
Balances at end of period, net of tax	$	(603	)	$	(17,110	)	$	(735	)	$	(18,448	)

	Unrealized Gains (Losses) on Securities Available for Sale			Disproportionate Tax Effect from Securities Available for Sale			Losses on Securities Transferred From Available for Sale to Held to Maturity			Unrealized Gains (Losses) from Postretirement Plan			Disproportionate Tax Effect from Postretirement Plan		Total
June 30, 2016	(Dollars in thousands)
Balances at beginning of period,    net of tax	$	(2,492	)	$	(17,110	)	$	(960	)	$	831		$	511	$	(19,220	)
Other comprehensive income    before reclassifications		11,122			—						—			—		11,122
Amortization of unrealized    gains of postretirement plan    recognized in other    comprehensive income		—			—			—			(362	)		—		(362	)
Accretion of unrealized losses    of securities transferred    from available for sale to    held to maturity recognized    in other comprehensive    income		—			—			71			—			—		71
Reclassification adjustment    for gains realized in income		(251	)		—			—			—			—		(251	)
Net current period other    comprehensive income		10,871			—			71			(362	)		—		10,580
Balances at end of period, net of    tax	$	8,379		$	(17,110	)	$	(889	)	$	469		$	511	$	(8,640	)

Summary of Reclassification Out of Each Component of Accumulated Comprehensive Income (Loss)

The following are significant amounts reclassified out of each component of accumulated comprehensive income (loss) for the three months ended June 30, 2017:

	Amount Reclassified			Affected Line Item on
	From Accumulated			the Statement Where
Details About Accumulated Other Comprehensive	Other Comprehensive			Net Income is
Income Components	Income			Presented
	(Dollars in thousands)
Realized net gains on the sale of available for sale securities	$	(301	)	Net gains on securitiesavailable for sale
		105		Tax expense
Total reclassification during the period	$	(196	)	Net of tax, increase to net income

The following are significant amounts reclassified out of each component of accumulated comprehensive income (loss) for the three months ended June 30, 2016:

	Amount Reclassified			Affected Line Item on
	From Accumulated			the Statement Where
Details About Accumulated Other Comprehensive	Other Comprehensive			Net Income is
Income Components	Income			Presented
	(Dollars in thousands)
Realized net gains on the sale of available for sale securities	$	(233	)	Net gainson securitiesavailable for sale
		81		Tax expense
		(152	)	Net of tax
Amortization of postretirement benefits prior service costs		(278	)	Reduction in salaries and employee benefits
		97		Tax expense
		(181	)	Net of tax
Total reclassification during the period	$	(333	)	Increase to net income

The following are significant amounts reclassified out of each component of accumulated comprehensive income (loss) for the six months ended June 30, 2017:

	Amount Reclassified			Affected Line Item on
	From Accumulated			the Statement Where
Details About Accumulated Other Comprehensive	Other Comprehensive			Net Income is
Income Components	Income			Presented
	(Dollars in thousands)
Realized net gains on the sale of available for sale securities	$	(330	)	Net gains on securitiesavailable for sale
		115		Tax expense
Total reclassification during the period	$	(215	)	Net of tax, increase to net income

The following are significant amounts reclassified out of each component of accumulated comprehensive income (loss) for the six months ended June 30, 2016:

	Amount Reclassified			Affected Line Item on
	From Accumulated			the Statement Where
Details About Accumulated Other Comprehensive	Other Comprehensive			Net Income is
Income Components	Income			Presented
	(Dollars in thousands)
Realized net gains on the sale of available for sale securities	$	(386	)	Net gainson securitiesavailable for sale
		135		Tax expense
		(251	)	Net of tax
Amortization of postretirement benefits prior service costs		(556	)	Reduction in salaries and employee benefits
		194		Tax expense
		(362	)	Net of tax
Total reclassification during the period	$	(613	)	Increase to net income

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REGULATORY CAPITAL REQUIREMENTS (Tables)

6 Months Ended

Jun. 30, 2017

United Community [Member]

Actual and Statutory Required Capital Amounts and Ratios

Actual and regulatory required consolidated capital ratios for United Community, along with the dollar amount of capital implied by such ratios, are presented below.

	June 30, 2017
						Minimum Capital
						Requirements
	Actual					Per Regulation***
	Amount		Ratio			Amount		Ratio
	(Dollars in thousands)
Total capital (to risk-weighted assets)	$	293,814		15.66	%	$	173,548		9.25	%
Tier 1 capital (to risk-weighted assets)		274,154		14.61	%		136,024		7.25	%
Common equity Tier 1 capital (to risk-weighted assets)		274,154		14.61	%		107,881		5.75	%
Tier 1 capital (to average assets)**		274,154		10.76	%		101,870		4.00	%
	December 31, 2016
						Minimum Capital
						Requirements
	Actual					Per Regulation***
	Amount		Ratio			Amount		Ratio
	(Dollars in thousands)
Total capital (to risk-weighted assets)	$	277,817		18.38	%	$	130,369		8.625	%
Tier 1 capital (to risk-weighted assets)		258,869		17.13	%		100,139		6.625	%
Common equity Tier 1 capital (to risk-weighted assets)		258,869		17.13	%		77,466		5.125	%
Tier 1 capital (to average assets)**		258,869		11.98	%		86,425		4.000	%

Components of Regulatory Capital

The components of United Community’s consolidated regulatory capital are as follows:

	June 30, 2017			December 31, 2016
Total shareholders' equity	$	285,480		$	249,806
Add (deduct)
Accumulated other comprehensive income		18,463			21,040
Intangible assets		(21,352	)		(1,567	)
Disallowed deferred tax assets		(8,437	)		(10,410	)
Disallowed capitalized mortgage loan servicing rights		—			—
Tier 1 Capital		274,154			258,869
Allowance for loan losses and allowance for unfunded lending commitments    limited to 1.25% of total risk-weighted assets		19,660			18,948
Total risk-based capital	$	293,814		$	277,817

Home Savings [Member]

Actual and Statutory Required Capital Amounts and Ratios

Actual and regulatory required capital ratios for Home Savings, along with the dollar amount of capital implied by such ratios, are presented below.

	June 30, 2017
											To Be Well Capitalized
						Minimum Capital					Under Prompt
						Requirements For Capital					Corrective Action
	Actual					Adequacy Purposes***					Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
	(Dollars in thousands)
Total capital (to risk-weighted assets)	$	277,583		14.83	%	$	173,129		9.25	%	$	187,166		10.00	%
Tier 1 capital (to risk-weighted assets)		257,947		13.78	%		135,695		7.25	%		149,733		8.00	%
Common equity Tier 1 capital (to risk-weighted    assets)		257,947		13.78	%		107,621		5.75	%		121,658		6.50	%
Tier 1 capital (to average assets)**		257,947		10.14	%		101,794		4.00	%		127,242		5.00	%

	December 31, 2016
											To Be Well Capitalized
						Minimum Capital					Under Prompt
						Requirements					Corrective Action
	Actual					Per Regulation***					Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
	(Dollars in thousands)
Total capital (to risk-weighted assets)	$	248,861		16.47	%	$	130,292		8.625	%	$	151,063		10.00	%
Tier 1 capital (to risk-weighted assets)		229,938		15.22	%		100,079		6.625	%		120,850		8.00	%
Common equity Tier 1 capital (to risk-weighted    assets)		229,938		15.22	%		77,420		5.125	%		98,191		6.50	%
Tier 1 capital (to average assets)**		229,938		10.65	%		86,360		4.000	%		107,950		5.00	%

** Tier 1 Leverage Capital Ratio

*** The capital ratios are reflective of the capital conservation buffer

Components of Regulatory Capital

The components of Home Savings’ regulatory capital are as follows:

	June 30, 2017			December 31, 2016
Total shareholders' equity	$	264,512		$	216,475
Add (deduct)
Accumulated other comprehensive income		18,463			21,056
Intangible assets		(20,313	)		(3	)
Disallowed deferred tax assets		(4,715	)		(7,590	)
Disallowed capitalized mortgage loan servicing rights		—			—
Tier 1 Capital		257,947			229,938
Allowance for loan losses and allowance for unfunded lending commitments    limited to 1.25% of total risk-weighted assets		19,636			18,923
Total risk-based capital	$	277,583		$	248,861

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INCOME TAXES (Tables)

6 Months Ended

Jun. 30, 2017

Income Tax Disclosure [Abstract]

Significant Components of Deferred Tax Assets and Liabilities

Significant components of the deferred tax assets and liabilities are as follows:

	June 30,		December 31,
	2017		2016
	(Dollars in thousands)
Deferred tax assets:
Loan loss reserves	$	6,881	$	6,680
Depreciation		886		748
Other real estate owned valuation		136		354
Tax credits carryforward		1,845		1,471
Unrealized loss on securities available for sale		324		1,685
Unrealized loss on securities held to maturity		396		431
Interest on nonaccrual loans		952		1,039
Net operating loss carryforward		6,593		8,574
Purchase accounting adjustment		1,000		—
Accrued bonuses		756		812
Other		79		221
Deferred tax assets		19,848		22,015
Deferred tax liabilities:
Deferred loan fees		1,622		1,275
Federal Home Loan Bank stock dividends		4,645		4,585
Mortgage servicing rights		2,155		2,124
FHLB prepayment penalty		649		786
Purchase accounting adjustment		—		371
Prepaid expenses		671		139
Deferred tax liabilities		9,742		9,280
Net deferred tax asset	$	10,106	$	12,735

Summary of Difference in Effective Tax Rates and Statutory Federal Income Tax Rate of 35%

Effective tax rates differr from the statutory federal income tax rate of 35% due to the following:

	For the Three Months Ended June 30,
	2017						2016
	Dollars			Rate			Dollars			Rate
	(Dollars in thousands)
Tax at statutory rate:	$	4,048			35.00	%	$	2,751			35.00	%
Increase (decrease) due to:
Tax exempt income		(166	)		(1.44	)%		(124	)		(1.57	)%
Life insurance		(137	)		(1.18	)%		(128	)		(1.63	)%
Stock compensation		(138	)		(1.19	)%		—			—	%
Other		(230	)		(1.99	)%		30			0.38	%
Income tax provision	$	3,377			29.20	%	$	2,529			32.18	%

	For the Six Months Ended June 30,
	2017						2016
	Dollars			Rate			Dollars			Rate
	(Dollars in thousands)
Tax at statutory rate:	$	4,781			35.00	%	$	4,470			35.00	%
Increase (decrease) due to:
Tax exempt income		(337	)		(2.47	)%		(187	)		(1.47	)%
Life insurance		(269	)		(1.97	)%		(256	)		(2.00	)%
Stock compensation		(198	)		(1.45	)%		—			—	%
Other		(43	)		(0.31	)%		94			0.74	%
Income tax provision	$	3,934			28.80	%	$	4,121			32.27	%

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GOODWILL AND INTANGIBLE ASSETS (Tables)

6 Months Ended

Jun. 30, 2017

Goodwill And Intangible Assets [Line Items]

Change in Goodwill

The change in goodwill during the periods presented is as follows:

	June 30, 2017		December 31, 2016
	(In thousands)
Beginning of the year	$	208	$	—
Effect of adjustments-James & Sons Insurance		636		—
Acquired goodwill-OLCB		18,420		—
Effect of adjustments-OLCB		15		—
Acquired goodwill-Eich Brothers Insurance		188		—
Acquired goodwill-James & Sons Insurance		—		208
Impairment	—		—
End of the year	$	19,467	$	208

Schedule of Acquired Intangible Assets

Acquired Intangible Assets:

	June 30, 2017				December 31, 2016
	Gross				Gross
	Carrying		Accumulated		Carrying		Accumulated
	Amount		Amortization		Amount		Amortization
	(In thousands)
Amortized intangible assets:
Core deposit intangibles	$	11,184	$	9,085	$	8,952	$	8,947
Customer list intangible		2,162		102		1,400		44
Total	$	13,346	$	9,187	$	10,352	$	8,991

Estimated Amortization Expense

Estimated amortization expense for the remainder of 2017 and the next five years is as follows:

Remainder of 2017	$	224,000
2018		448,000
2019		448,000
2020		448,000
2021		448,000
2022		448,000

Core deposit intangibles [Member]

Goodwill And Intangible Assets [Line Items]

Schedule of Acquired Intangible Assets

Core deposit intangible:

	For the six months ended June 30, 2017			For the year ended December 31, 2016
	(In thousands)
Beginning of the year	$	5		$	30
Acquired core deposit intangible-OLCB		2,232			—
Amortization		(138	)		(25	)
End of the period	$	2,099		$	5

Customer list intangible [Member]

Goodwill And Intangible Assets [Line Items]

Schedule of Acquired Intangible Assets

Customer list intangible:

	For the six months ended June 30, 2017			For the year ended December 31, 2016
	(In thousands)
Beginning of the year	$	1,356		$	—
Effect of adjustments-James & Sons Insurance		(41	)		—
Acquired customer list intangible-OLCB		268			—
Acquired customer list intangible-Eich Brothers Insurance		535			—
Acquired customer list intangible-James & Sons Insurance		—			1,400
Amortization		(58	)		(44	)
End of the period	$	2,060		$	1,356

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Basis of Presentation - Additional Information (Detail) $ in Thousands		6 Months Ended
	Jan. 31, 2017 USD ($) shares	Jun. 30, 2017 RetailBankingOffice LoanProductionCenter
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]
Number of retail banking offices | RetailBankingOffice		35
Number of loan production centers | LoanProductionCenter		12
HSB Insurance, Inc. [Member]
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]
Operations commenced date		Jun. 01, 2017
OLCB [Member]
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]
Acquisition date		Jan. 31, 2017
Business acquisition, common shares issued | shares	3,033,604
Business acquisition, cash | $	$ 20,379

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Recent Accounting Developments - Additional Information (Detail)	6 Months Ended
	Jun. 30, 2017 USD ($)
Accounting Standards Update 2016-09 [Member]
New Accounting Pronouncement Early Adoption [Line Items]
Recognized tax benefit in income tax expense related to vesting of restricted stock awards and exercised stock options	$ 198,000

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Stock Compensation - Additional Information (Detail) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016	Apr. 30, 2015	Apr. 26, 2007
Stock Option [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Shares, Granted			0	0
Option expiry term (Years)			10 years
Stock-based compensation expense	$ 0	$ 3,000	$ 1,000	$ 6,000
Expected additional expense for 2017	0		$ 0
Weighted-average recognition period of nonvested stock options expense			3 months
Weighted average remaining life for outstanding stock			2 years 10 months 28 days
Exercise price range, lower range limit			$ 1.20
Exercise price range, upper range limit			$ 5.89
Restricted Stock [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Stock-based compensation expense	185,000	247,000	$ 456,000	462,000
Expected additional expense for 2017	$ 365,000		$ 365,000
Nonvested shares	277,168		277,168		341,184
Expected to vest shares during remainder of 2017			16,553
Expected to vest shares during 2018			122,375
Expected to vest shares during 2019			105,567
Expected to vest shares during 2020			32,673
Expected additional expense for 2018	$ 503,000		$ 503,000
Expected additional expense for 2019	210,000		210,000
Expected additional expense for 2020	$ 11,000		$ 11,000
Total average per share fair value of shares vested			$ 8.63
2015 Long Term Incentive Compensation Plan [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Authorized shares of stock, option plan, maximum						1,200,000
2007 Long-Term Incentive Plan [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Authorized shares of stock, option plan, maximum							2,000,000
1999 Long-Term Incentive Plan [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Authorized shares of stock, option plan, maximum	3,569,766		3,569,766
Annual Incentive Plan [Member] | Restricted Stock [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Stock-based compensation expense	$ 46,000	93,000	$ 122,000	170,000
Annual Incentive Plan [Member] | Restricted Stock [Member] | Beginning on first anniversary of issue date [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Stock-based compensation vesting period			3 years
Annual Incentive Plan [Member] | Cash Portion [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Stock-based compensation expense	434,000	293,000	$ 930,000	618,000
Long Term Incentive Plan [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Stock-based compensation expense	$ (4,000)	$ 97,000	$ 149,000	$ 193,000

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Stock Compensation - Summary of Option Activity in Plans (Detail) $ / shares in Units, $ in Thousands	6 Months Ended
	Jun. 30, 2017 USD ($) $ / shares shares
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Shares, Outstanding at beginning of year | shares	371,218
Shares, Exercised | shares	(33,418)
Shares, Forfeited and expired | shares	(600)
Shares, Outstanding at end of period | shares	337,200
Shares, Shares subject to options exercisable at end of period | shares	337,200
Weighted average exercise price, Outstanding at beginning of year | $ / shares	$ 2.55
Weighted average exercise price, Exercised | $ / shares	2.18
Weighted average exercise price, Forfeited and expired | $ / shares	2.10
Weighted average exercise price, Outstanding at end of period | $ / shares	2.55
Weighted average exercise price, Shares subject to options exercisable at end of period | $ / shares	$ 2.55
Aggregate intrinsic value, Outstanding at end of period | $	$ 1,931
Aggregate intrinsic value, Shares subject to options exercisable at end of period | $	$ 1,931

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Stock Compensation - Information Related to Stock Options (Detail) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Intrinsic value of options exercised	$ 208,633	$ 283,310
Cash received from option exercises	72,818	$ 129,940	$ 74,000	$ 130,000
Tax benefit realized from option exercises	$ 73,022

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Stock Compensation - Summary of Changes in Company's Nonvested Restricted Shares (Detail) - Restricted Stock [Member]	6 Months Ended
	Jun. 30, 2017 $ / shares shares
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Shares, Nonvested shares, Beginning balance | shares	341,184
Shares, Granted | shares	68,761
Shares, Vested | shares	(132,777)
Shares, Nonvested shares, Ending balance | shares	277,168
Weighted average grant date fair value, Nonvested shares, Beginning balance | $ / shares	$ 5.50
Weighted average grant date fair value, Granted | $ / shares	8.62
Weighted average grant date fair value, Vested | $ / shares	4.91
Weighted average grant date fair value, Nonvested shares, Ending balance | $ / shares	$ 6.56

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Business Combination - Additional Information (Detail) - USD ($)			6 Months Ended
	Feb. 28, 2017	Jan. 31, 2017	Jun. 30, 2017
Business Acquisition [Line Items]
Business acquisition, related costs			$ 4,962,000
HSB Insurance, LLC [Member]
Business Acquisition [Line Items]
Acquisition date			Feb. 28, 2017
Business acquisition, cash	$ 107,000
Business acquisition, remaining amount to be paid	$ 428,000
Business acquisition, equal installments	four equal installments
Business acquisition, total consideration	$ 535,000
Customer list intangible [Member] | HSB Insurance, LLC [Member]
Business Acquisition [Line Items]
Business acquisition, total assets purchase	$ 535,000
United Community [Member]
Business Acquisition [Line Items]
Business acquisition, related costs			$ 4,100,000
OLCB [Member]
Business Acquisition [Line Items]
Acquisition date			Jan. 31, 2017
Common stock conversion		Each OLCB common share was converted into the right to receive either $18.00 in cash or 2.736 United Community common shares, subject to certain allocation procedures set forth in the Merger Agreement that ensured that 50% of OLCB’s common shares outstanding were converted into United Community common shares and 50% of OLCB’s common shares outstanding were exchanged for the cash consideration.
Business acquisition, per share price		$ 18.00
Business acquisition, common stock issuable per each acquired share		2.736
Business acquisition, shares consideration		50.00%
Business acquisition, cash consideration		50.00%
Business acquisition, common shares issued		3,033,604
Business acquisition, cash		$ 20,379,000
Business acquisition, related costs			$ 368,000
Gross value of acquired receivables		2,600,000
Fair value of acquired receivables		2,500,000
Deductible goodwill for income tax purposes		0
Business acquisition, total consideration		46,195,000
OLCB [Member] | Core Deposits [Member]
Business Acquisition [Line Items]
Fair value of intangible assets		$ 2,200,000

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Business Combination - Summary of Consideration Paid (Detail) - OLCB [Member] $ in Thousands	Jan. 31, 2017 USD ($)
Business Acquisition [Line Items]
Cash	$ 20,379
United Community shares issued	25,816
Total fair value of consideration paid	$ 46,195

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Business Combination - Schedule of Assets Acquired and Liabilities Assumed (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Jan. 31, 2017	Dec. 31, 2016
Business Acquisition [Line Items]
Goodwill created	$ 19,467		$ 208
OLCB [Member]
Business Acquisition [Line Items]
Cash		$ 46,159
Loans		259,373
Available for sale securities		9,996
FHLB stock, at cost		1,256
Premises and equipment		2,940
Accrued interest		679
Other intangible assets		2,426
Other real estate owned		89
Other assets		7,988
Total assets acquired		330,906
Deposits assumed		266,279
Federal Home Loan Bank advances		23,500
Repurchase agreements and other borrowings		10,771
Accrued expenses and other liabilities		2,581
Total liabilities assumed		303,131
Goodwill created		$ 18,420

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Business Combination - Summary of Pro Forma Information (Detail) - USD ($) $ / shares in Units, $ in Thousands	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Business Combinations [Abstract]
Net interest income	$ 39,992	$ 36,251
Net income	$ 9,371	$ 10,270
Basic earnings per share	$ 0.19	$ 0.20
Diluted earnings per share	$ 0.19	$ 0.20

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Securities - Components of Available for Sale Portfolio (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
Total amortized cost	$ 288,105	$ 348,099
Available-for-sale securities, Gross unrealized gains	751	225
Available-for-sale securities, Gross unrealized losses	(1,677)	(5,040)
Available-for-sale securities, Total fair value	287,179	343,284
U.S. Treasury and Government Sponsored Entities' Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Total amortized cost	134,820	188,082
Available-for-sale securities, Gross unrealized gains	273	172
Available-for-sale securities, Gross unrealized losses	(490)	(2,221)
Available-for-sale securities, Total fair value	134,603	186,033
States of the U.S. and Political Subdivisions [Member]
Schedule of Available-for-sale Securities [Line Items]
Total amortized cost	59,112	59,415
Available-for-sale securities, Gross unrealized gains	387	3
Available-for-sale securities, Gross unrealized losses	(675)	(1,661)
Available-for-sale securities, Total fair value	58,824	57,757
Mortgage-Backed GSE Securities: Residential [Member]
Schedule of Available-for-sale Securities [Line Items]
Total amortized cost	94,173	100,602
Available-for-sale securities, Gross unrealized gains	91	50
Available-for-sale securities, Gross unrealized losses	(512)	(1,158)
Available-for-sale securities, Total fair value	$ 93,752	$ 99,494

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Securities - Components of Held to Maturity Securities Portfolio (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Schedule Of Held To Maturity Securities [Line Items]
Held to maturity securities, Total amortized cost	$ 88,559	$ 97,519
Held to maturity securities, Gross unrecognized gains	109	17
Held to maturity securities, Gross unrecognized losses	(893)	(1,386)
Held to maturity securities, Fair value	87,775	96,150
Mortgage-Backed GSE Securities: Residential [Member]
Schedule Of Held To Maturity Securities [Line Items]
Held to maturity securities, Total amortized cost	79,318	85,065
Held to maturity securities, Gross unrecognized losses	(892)	(1,300)
Held to maturity securities, Fair value	78,426	83,765
States of the U.S. and Political Subdivisions [Member]
Schedule Of Held To Maturity Securities [Line Items]
Held to maturity securities, Total amortized cost	9,241	12,454
Held to maturity securities, Gross unrecognized gains	109	17
Held to maturity securities, Gross unrecognized losses	(1)	(86)
Held to maturity securities, Fair value	$ 9,349	$ 12,385

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Securities - Debt Securities Available for Sale by Contractual Maturity (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Available For Sale Securities Debt Maturities [Abstract]
Due after one year through five years, amortized cost	$ 4,594
Due after five years through ten years, amortized cost	130,641
Due after ten years, amortized cost	58,697
Mortgage-backed GSE securities: residential, amortized cost	94,173
Total amortized cost	288,105	$ 348,099
Due after one year through five years, fair value	4,579
Due after five years through ten years, fair value	130,447
Due after ten years, fair value	58,401
Mortgage-backed GSE securities: residential, fair value	93,752
Total fair value	$ 287,179	$ 343,284

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Securities - Debt Securities Held to Maturity by Contractual Maturity (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Investments Debt And Equity Securities [Abstract]
Due after five years through ten years, amortized cost	$ 7,290
Due after ten years, amortized cost	1,951
Mortgage-backed GSE securities: residential, amortized cost	79,318
Held to maturity securities, Total amortized cost	88,559	$ 97,519
Due after five years through ten years, fair value	7,375
Due after ten years, fair value	1,974
Mortgage-backed GSE securities: residential, fair value	78,426
Held to maturity securities, Total fair value	$ 87,775	$ 96,150

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Securities - Additional Information (Detail) - USD ($)	3 Months Ended			6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Sep. 30, 2015	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Investments Debt And Equity Securities [Abstract]
Securities pledged for public funds	$ 136,800,000			$ 136,800,000		$ 146,500,000
Available for sale securities transferred to held to maturity, total amortized cost			$ 105,300,000
Available for sale securities transferred to held to maturity fair value			103,800,000
Net unrealized loss, net of taxes, on securities at date of transfer			$ (999,000)
Proceeds from the sale of securities available for sale	48,100,000	$ 10,400,000		53,171,000	$ 28,530,000
Gross gains realized on sales of securities available for sale	345,000	233,000		374,000	386,000
Gross loss realized on sales of securities available for sale	44,000	0		44,000	0
Income tax expense related to net realized gains and losses	$ 105,000	$ 81,000		$ 115,000	$ 135,000

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Securities - Securities Available for Sale in Unrealized Loss Position (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
Fair value, Less than 12 months	$ 183,129	$ 323,469
Unrealized loss, Less than 12 months	(1,677)	(5,040)
Total Fair value	183,129	323,469
Total, unrealized loss	(1,677)	(5,040)
States of the U.S. and Political Subdivisions [Member]
Schedule of Available-for-sale Securities [Line Items]
Fair value, Less than 12 months	37,694	53,283
Unrealized loss, Less than 12 months	(675)	(1,661)
Total Fair value	37,694	53,283
Total, unrealized loss	(675)	(1,661)
U.S. Treasury and Government Sponsored Entities' Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Fair value, Less than 12 months	74,259	171,411
Unrealized loss, Less than 12 months	(490)	(2,221)
Total Fair value	74,259	171,411
Total, unrealized loss	(490)	(2,221)
Mortgage-Backed GSE Securities: Residential [Member]
Schedule of Available-for-sale Securities [Line Items]
Fair value, Less than 12 months	71,176	98,775
Unrealized loss, Less than 12 months	(512)	(1,158)
Total Fair value	71,176	98,775
Total, unrealized loss	$ (512)	$ (1,158)

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Securities - Securities Held to Maturity in Unrecognized Loss Position (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Schedule Of Held To Maturity Securities [Line Items]
Fair value, Less than 12 months	$ 54,481	$ 64,756
Unrealized loss, Less than 12 months	(935)	(1,329)
Fair value, 12 months or more	24,907	26,426
Unrealized loss, 12 months or more	(1,089)	(1,287)
Total fair value	79,388	91,182
Total unrealized loss	(2,024)	(2,616)
Mortgage-Backed GSE Securities: Residential [Member]
Schedule Of Held To Maturity Securities [Line Items]
Fair value, Less than 12 months	53,519	57,340
Unrealized loss, Less than 12 months	(934)	(1,243)
Fair value, 12 months or more	24,907	26,426
Unrealized loss, 12 months or more	(1,089)	(1,287)
Total fair value	78,426	83,766
Total unrealized loss	(2,023)	(2,530)
States of the U.S. and Political Subdivisions [Member]
Schedule Of Held To Maturity Securities [Line Items]
Fair value, Less than 12 months	962	7,416
Unrealized loss, Less than 12 months	(1)	(86)
Total fair value	962	7,416
Total unrealized loss	$ (1)	$ (86)

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Loans - Schedule of Portfolio of Loans (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2015
Financing Receivable Allowance For Credit Losses [Line Items]
Total loans	$ 1,884,701		$ 1,519,477
Allowance for loan losses	19,660	$ 18,970	19,087	$ 17,172	$ 16,903	$ 17,712
Deferred loan costs, net	(4,054)		(3,187)
Total	15,606		15,900
Loans, net	1,869,095		1,503,577
Commercial Loans [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Total loans	742,255		504,258
Allowance for loan losses	10,821	10,182	10,824	8,958	8,521	8,077
Commercial Loans [Member] | Multifamily [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Total loans	121,565		93,597
Commercial Loans [Member] | Nonresidential [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Total loans	342,300		231,401
Commercial Loans [Member] | Land [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Total loans	10,867		8,373
Commercial Loans [Member] | Construction [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Total loans	96,765		68,158
Commercial Loans [Member] | Secured [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Total loans	162,109		95,343
Commercial Loans [Member] | Unsecured [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Total loans	8,649		7,386
Residential Mortgage Loans [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Total loans	891,295		798,621
Allowance for loan losses	5,968	5,912	5,538	5,644	5,736	6,630
Residential Mortgage Loans [Member] | Construction [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Total loans	56,946		35,695
Residential Mortgage Loans [Member] | One-to Four-Family [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Total loans	834,349		762,926
Consumer Loans [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Total loans	251,151		216,598
Allowance for loan losses	2,871	$ 2,876	2,725	$ 2,570	$ 2,646	$ 3,005
Consumer Loans [Member] | Home Equity [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Total loans	187,762		165,054
Consumer Loans [Member] | Auto [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Total loans	50,389		39,609
Consumer Loans [Member] | Marine [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Total loans	1,601		1,796
Consumer Loans [Member] | Recreational Vehicle [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Total loans	6,401		7,602
Consumer Loans [Member] | Other [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Total loans	$ 4,998		$ 2,537

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Loans - Investment in Loans by Portfolio Segment and Based on Impairment (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Financing Receivable Allowance For Credit Losses [Line Items]
Allowance, Beginning balance	$ 18,970	$ 16,903	$ 19,087	$ 17,712
Provision (recovery) for loan losses	842	395	2,317	2,550
Charge-offs	(435)	(507)	(2,305)	(3,694)
Recoveries	283	381	561	604
Allowance, Ending balance	19,660	17,172	19,660	17,172
Allowance, Loans individually evaluated for impairment	1,616	2,884	1,616	2,884	$ 3,016
Allowance, Loans collectively evaluated for impairment	18,044		18,044		16,071
Period-end balances, Loans individually evaluated for impairment	26,310		26,310		31,548
Period-end balances, Loans collectively evaluated for impairment	1,857,170		1,857,170		1,487,929
Total loans	1,884,701		1,884,701		1,519,477
Loans Acquired with Deteriorated Credit Quality [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Period-end balances, Loans acquired with deteriorated credit quality	1,221		1,221
Commercial Loans [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Allowance, Beginning balance	10,182	8,521	10,824	8,077
Provision (recovery) for loan losses	503	489	1,025	3,213
Charge-offs	(12)	(147)	(1,323)	(2,493)
Recoveries	148	95	295	161
Allowance, Ending balance	10,821	8,958	10,821	8,958
Allowance, Loans individually evaluated for impairment	5	1,015	5	1,015	1,271
Allowance, Loans collectively evaluated for impairment	10,816		10,816		9,553
Period-end balances, Loans individually evaluated for impairment	2,532		2,532		6,018
Period-end balances, Loans collectively evaluated for impairment	738,502		738,502		498,240
Total loans	742,255		742,255		504,258
Commercial Loans [Member] | Loans Acquired with Deteriorated Credit Quality [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Period-end balances, Loans acquired with deteriorated credit quality	1,221		1,221
Residential Mortgage Loans [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Allowance, Beginning balance	5,912	5,736	5,538	6,630
Provision (recovery) for loan losses	295	(33)	865	(627)
Charge-offs	(273)	(84)	(503)	(446)
Recoveries	34	25	68	87
Allowance, Ending balance	5,968	5,644	5,968	5,644
Allowance, Loans individually evaluated for impairment	1,171	1,333	1,171	1,333	1,245
Allowance, Loans collectively evaluated for impairment	4,797		4,797		4,293
Period-end balances, Loans individually evaluated for impairment	16,190		16,190		17,485
Period-end balances, Loans collectively evaluated for impairment	875,105		875,105		781,136
Total loans	891,295		891,295		798,621
Consumer Loans [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Allowance, Beginning balance	2,876	2,646	2,725	3,005
Provision (recovery) for loan losses	44	(61)	427	(36)
Charge-offs	(150)	(276)	(479)	(755)
Recoveries	101	261	198	356
Allowance, Ending balance	2,871	2,570	2,871	2,570
Allowance, Loans individually evaluated for impairment	440	$ 536	440	$ 536	500
Allowance, Loans collectively evaluated for impairment	2,431		2,431		2,225
Period-end balances, Loans individually evaluated for impairment	7,588		7,588		8,045
Period-end balances, Loans collectively evaluated for impairment	243,563		243,563		208,553
Total loans	$ 251,151		$ 251,151		$ 216,598

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Loans - Presentation of Loans Individually Evaluated for Impairment by Class (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Financing Receivable Impaired [Line Items]
With no specific allowance recorded, Unpaid Principal Balance	$ 21,560	$ 24,898	$ 21,560	$ 24,898	$ 22,728
With no specific allowance recorded, Recorded Investment	9,712	12,859	9,712	12,859	10,444
With no specific allowance recorded, Average Recorded Investment	9,151	12,588	9,581	12,503
With no specific allowance recorded, Interest Income Recognized	50	20	116	61
With no specific allowance recorded, Cash Basis Income Recognized	50	20	105	51
With a specific allowance recorded, Unpaid Principal Balance	16,806	31,142	16,806	31,142	24,114
With a specific allowance recorded, Recorded Investment	16,598	28,765	16,598	28,765	21,104
With a specific allowance recorded, Allowance for Loan Losses Allocated	1,616	2,884	1,616	2,884	3,016
With a specific allowance recorded, Average Recorded Investment	17,926	29,534	18,984	28,795
With a specific allowance recorded, Interest Income Recognized	193	233	453	628
With a specific allowance recorded, Cash Basis Income Recognized	189	229	390	558
Total Unpaid Principal Balance	38,366	56,040	38,366	56,040	46,842
Total Recorded Investment	26,310	41,624	26,310	41,624	31,548
Total Average Recorded Investment	27,077	42,122	28,565	41,298
Total Interest Income Recognized	243	253	569	689
Total Cash Basis Income Recognized	239	249	495	609
Commercial Loans [Member]
Financing Receivable Impaired [Line Items]
With no specific allowance recorded, Unpaid Principal Balance	10,757	13,856	10,757	13,856	10,804
With no specific allowance recorded, Recorded Investment	2,076	4,410	2,076	4,410	1,713
With no specific allowance recorded, Average Recorded Investment	1,430	4,353	1,524	4,365
With no specific allowance recorded, Interest Income Recognized	25	1	53	3
With no specific allowance recorded, Cash Basis Income Recognized	25	1	52	3
With a specific allowance recorded, Unpaid Principal Balance	501	11,881	501	11,881	7,167
With a specific allowance recorded, Recorded Investment	456	9,504	456	9,504	4,305
With a specific allowance recorded, Allowance for Loan Losses Allocated	5	1,015	5	1,015	1,271
With a specific allowance recorded, Average Recorded Investment	1,179	9,695	2,221	8,232
With a specific allowance recorded, Interest Income Recognized	5	15	12	124
With a specific allowance recorded, Cash Basis Income Recognized	5	15	11	122
Commercial Loans [Member] | Multifamily [Member]
Financing Receivable Impaired [Line Items]
With no specific allowance recorded, Unpaid Principal Balance	470	95	470	95	55
With no specific allowance recorded, Recorded Investment	413		413
With no specific allowance recorded, Average Recorded Investment	416		277
With no specific allowance recorded, Interest Income Recognized			3
With no specific allowance recorded, Cash Basis Income Recognized			3
Commercial Loans [Member] | Nonresidential [Member]
Financing Receivable Impaired [Line Items]
With no specific allowance recorded, Unpaid Principal Balance	2,030	1,382	2,030	1,382	2,278
With no specific allowance recorded, Recorded Investment	1,464	326	1,464	326	1,489
With no specific allowance recorded, Average Recorded Investment	815	269	1,040	281
With no specific allowance recorded, Interest Income Recognized	25	1	50	3
With no specific allowance recorded, Cash Basis Income Recognized	25	1	49	3
With a specific allowance recorded, Unpaid Principal Balance	501	10,854	501	10,854	6,930
With a specific allowance recorded, Recorded Investment	456	8,571	456	8,571	4,133
With a specific allowance recorded, Allowance for Loan Losses Allocated	5	922	5	922	1,193
With a specific allowance recorded, Average Recorded Investment	1,179	8,748	2,164	7,493
With a specific allowance recorded, Interest Income Recognized	5	15	12	124
With a specific allowance recorded, Cash Basis Income Recognized	5	15	11	122
Commercial Loans [Member] | Land [Member]
Financing Receivable Impaired [Line Items]
With no specific allowance recorded, Unpaid Principal Balance	3,922	3,922	3,922	3,922	3,922
With no specific allowance recorded, Recorded Investment	9	384	9	384	34
With no specific allowance recorded, Average Recorded Investment	9	384	17	384
Commercial Loans [Member] | Construction [Member]
Financing Receivable Impaired [Line Items]
With no specific allowance recorded, Unpaid Principal Balance	3,593	3,594	3,593	3,594	3,594
Commercial Loans [Member] | Secured [Member]
Financing Receivable Impaired [Line Items]
With no specific allowance recorded, Unpaid Principal Balance	242	3,745	242	3,745	242
With no specific allowance recorded, Recorded Investment	190	3,700	190	3,700	190
With no specific allowance recorded, Average Recorded Investment	190	3,700	190	3,700
With a specific allowance recorded, Unpaid Principal Balance		1,027		1,027	237
With a specific allowance recorded, Recorded Investment		933		933	172
With a specific allowance recorded, Allowance for Loan Losses Allocated		93		93	78
With a specific allowance recorded, Average Recorded Investment		947	57	739
Commercial Loans [Member] | Unsecured [Member]
Financing Receivable Impaired [Line Items]
With no specific allowance recorded, Unpaid Principal Balance	500	1,118	500	1,118	713
Residential Mortgage Loans [Member]
Financing Receivable Impaired [Line Items]
With no specific allowance recorded, Unpaid Principal Balance	7,704	8,102	7,704	8,102	8,736
With no specific allowance recorded, Recorded Investment	5,762	6,522	5,762	6,522	6,758
With no specific allowance recorded, Average Recorded Investment	5,763	6,302	6,095	6,156
With no specific allowance recorded, Interest Income Recognized	20	17	50	52
With no specific allowance recorded, Cash Basis Income Recognized	20	17	41	42
With a specific allowance recorded, Unpaid Principal Balance	10,526	12,033	10,526	12,033	10,810
With a specific allowance recorded, Recorded Investment	10,428	12,033	10,428	12,033	10,727
With a specific allowance recorded, Allowance for Loan Losses Allocated	1,171	1,333	1,171	1,333	1,245
With a specific allowance recorded, Average Recorded Investment	10,783	12,372	10,764	12,742
With a specific allowance recorded, Interest Income Recognized	114	124	273	297
With a specific allowance recorded, Cash Basis Income Recognized	111	122	229	251
Residential Mortgage Loans [Member] | One-to Four-Family [Member]
Financing Receivable Impaired [Line Items]
With no specific allowance recorded, Unpaid Principal Balance	7,704	8,102	7,704	8,102	8,736
With no specific allowance recorded, Recorded Investment	5,762	6,522	5,762	6,522	6,758
With no specific allowance recorded, Average Recorded Investment	5,763	6,302	6,095	6,156
With no specific allowance recorded, Interest Income Recognized	20	17	50	52
With no specific allowance recorded, Cash Basis Income Recognized	20	17	41	42
With a specific allowance recorded, Unpaid Principal Balance	10,526	12,033	10,526	12,033	10,810
With a specific allowance recorded, Recorded Investment	10,428	12,033	10,428	12,033	10,727
With a specific allowance recorded, Allowance for Loan Losses Allocated	1,171	1,333	1,171	1,333	1,245
With a specific allowance recorded, Average Recorded Investment	10,783	12,372	10,764	12,742
With a specific allowance recorded, Interest Income Recognized	114	124	273	297
With a specific allowance recorded, Cash Basis Income Recognized	111	122	229	251
Consumer Loans [Member]
Financing Receivable Impaired [Line Items]
With no specific allowance recorded, Unpaid Principal Balance	3,099	2,940	3,099	2,940	3,188
With no specific allowance recorded, Recorded Investment	1,874	1,927	1,874	1,927	1,973
With no specific allowance recorded, Average Recorded Investment	1,958	1,933	1,962	1,982
With no specific allowance recorded, Interest Income Recognized	5	2	13	6
With no specific allowance recorded, Cash Basis Income Recognized	5	2	12	6
With a specific allowance recorded, Unpaid Principal Balance	5,779	7,228	5,779	7,228	6,137
With a specific allowance recorded, Recorded Investment	5,714	7,228	5,714	7,228	6,072
With a specific allowance recorded, Allowance for Loan Losses Allocated	440	536	440	536	500
With a specific allowance recorded, Average Recorded Investment	5,964	7,467	5,999	7,821
With a specific allowance recorded, Interest Income Recognized	74	94	168	207
With a specific allowance recorded, Cash Basis Income Recognized	73	92	150	185
Consumer Loans [Member] | Home Equity [Member]
Financing Receivable Impaired [Line Items]
With no specific allowance recorded, Unpaid Principal Balance	1,965	1,858	1,965	1,858	2,159
With no specific allowance recorded, Recorded Investment	1,535	1,339	1,535	1,339	1,583
With no specific allowance recorded, Average Recorded Investment	1,574	1,336	1,577	1,463
With no specific allowance recorded, Interest Income Recognized	3	1	8	4
With no specific allowance recorded, Cash Basis Income Recognized	3	1	7	4
With a specific allowance recorded, Unpaid Principal Balance	4,973	6,279	4,973	6,279	5,390
With a specific allowance recorded, Recorded Investment	4,919	6,279	4,919	6,279	5,335
With a specific allowance recorded, Allowance for Loan Losses Allocated	377	447	377	447	426
With a specific allowance recorded, Average Recorded Investment	5,151	6,568	5,212	6,791
With a specific allowance recorded, Interest Income Recognized	66	84	151	188
With a specific allowance recorded, Cash Basis Income Recognized	66	82	134	167
Consumer Loans [Member] | Auto [Member]
Financing Receivable Impaired [Line Items]
With no specific allowance recorded, Unpaid Principal Balance	34	16	34	16	11
With no specific allowance recorded, Recorded Investment	18	9	18	9	3
With no specific allowance recorded, Average Recorded Investment	16	9	11	11
Consumer Loans [Member] | Marine [Member]
Financing Receivable Impaired [Line Items]
With no specific allowance recorded, Unpaid Principal Balance	540	544	540	544	585
With no specific allowance recorded, Recorded Investment	169	302	169	302	267
With no specific allowance recorded, Average Recorded Investment	182	303	210	292
With a specific allowance recorded, Unpaid Principal Balance	104	156	104	156	108
With a specific allowance recorded, Recorded Investment	104	156	104	156	108
With a specific allowance recorded, Allowance for Loan Losses Allocated	1	4	1	4	1
With a specific allowance recorded, Average Recorded Investment	105	158	106	159
With a specific allowance recorded, Interest Income Recognized	1	2	3	4
With a specific allowance recorded, Cash Basis Income Recognized	1	2	3	4
Consumer Loans [Member] | Recreational Vehicle [Member]
Financing Receivable Impaired [Line Items]
With no specific allowance recorded, Unpaid Principal Balance	560	518	560	518	433
With no specific allowance recorded, Recorded Investment	152	273	152	273	120
With no specific allowance recorded, Average Recorded Investment	186	281	164	213
With no specific allowance recorded, Interest Income Recognized	2	1	5	2
With no specific allowance recorded, Cash Basis Income Recognized	2	1	5	2
With a specific allowance recorded, Unpaid Principal Balance	702	793	702	793	639
With a specific allowance recorded, Recorded Investment	691	793	691	793	629
With a specific allowance recorded, Allowance for Loan Losses Allocated	62	85	62	85	$ 73
With a specific allowance recorded, Average Recorded Investment	708	741	681	868
With a specific allowance recorded, Interest Income Recognized	7	8	14	15
With a specific allowance recorded, Cash Basis Income Recognized	$ 6	8	$ 13	14
Consumer Loans [Member] | Other [Member]
Financing Receivable Impaired [Line Items]
With no specific allowance recorded, Unpaid Principal Balance		4		4
With no specific allowance recorded, Recorded Investment		4		4
With no specific allowance recorded, Average Recorded Investment		$ 4		3
With a specific allowance recorded, Average Recorded Investment				$ 3

XML

Loans - Loans in Process of Foreclosure (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016	Jun. 30, 2016
Financing Receivable Impaired [Line Items]
Unpaid Principal Balance	$ 38,366	$ 46,842	$ 56,040
Total Recorded Investment	26,310	31,548
Residential Mortgage Loans [Member] | Loans In Process Of Foreclosure [Member]
Financing Receivable Impaired [Line Items]
Unpaid Principal Balance	3,188	3,025
Total Recorded Investment	2,816	2,576
Consumer Loans [Member] | Loans In Process Of Foreclosure [Member]
Financing Receivable Impaired [Line Items]
Unpaid Principal Balance	931	1,069
Total Recorded Investment	$ 751	$ 795

XML

Loans - Presentation of Recorded Investment in Nonaccrual Loans and Loans Past Due Over 90 Days and Still on Accrual by Class of Loans (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Financing Receivable Recorded Investment Past Due [Line Items]
Financing receivable, recorded investment, Nonaccrual	$ 10,781	$ 12,439
Financing receivable, recorded investment, Loans past due over 90 days and still accruing	2
Commercial Loans [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Financing receivable, recorded investment, Nonaccrual	1,943	3,941
Commercial Loans [Member] | Multifamily [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Financing receivable, recorded investment, Nonaccrual	413
Commercial Loans [Member] | Nonresidential [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Financing receivable, recorded investment, Nonaccrual	1,331	3,546
Commercial Loans [Member] | Land [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Financing receivable, recorded investment, Nonaccrual	9	34
Commercial Loans [Member] | Secured [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Financing receivable, recorded investment, Nonaccrual	190	361
Residential Mortgage Loans [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Financing receivable, recorded investment, Nonaccrual	6,701	6,084
Residential Mortgage Loans [Member] | One-to Four-Family [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Financing receivable, recorded investment, Nonaccrual	6,701	6,084
Consumer Loans [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Financing receivable, recorded investment, Nonaccrual	2,137	2,414
Financing receivable, recorded investment, Loans past due over 90 days and still accruing	2
Consumer Loans [Member] | Home Equity [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Financing receivable, recorded investment, Nonaccrual	1,707	1,936
Consumer Loans [Member] | Auto [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Financing receivable, recorded investment, Nonaccrual	94	31
Consumer Loans [Member] | Marine [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Financing receivable, recorded investment, Nonaccrual	169	267
Consumer Loans [Member] | Recreational Vehicle [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Financing receivable, recorded investment, Nonaccrual	166	178
Consumer Loans [Member] | Other [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Financing receivable, recorded investment, Nonaccrual	1	$ 2
Financing receivable, recorded investment, Loans past due over 90 days and still accruing	$ 2

XML

Loans - Presentation of Age Analysis of Past-Due Loans, Segregated by Class of Loans (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	$ 14,330	$ 18,871
Current Loans	1,870,371	1,500,606
Total loans	1,884,701	1,519,477
30-59 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	4,442	8,488
60-89 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	2,178	2,525
Greater than 90 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	7,710	7,858
Commercial Loans [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	894	3,967
Current Loans	741,361	500,291
Total loans	742,255	504,258
Commercial Loans [Member] | 30-59 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	334	3,511
Commercial Loans [Member] | 60-89 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	209
Commercial Loans [Member] | Greater than 90 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	351	456
Commercial Loans [Member] | Multifamily [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	187
Current Loans	121,378	93,597
Total loans	121,565	93,597
Commercial Loans [Member] | Multifamily [Member] | 60-89 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	187
Commercial Loans [Member] | Nonresidential [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	352	3,572
Current Loans	341,948	227,829
Total loans	342,300	231,401
Commercial Loans [Member] | Nonresidential [Member] | 30-59 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	199	3,511
Commercial Loans [Member] | Nonresidential [Member] | Greater than 90 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	153	61
Commercial Loans [Member] | Land [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	9	34
Current Loans	10,858	8,339
Total loans	10,867	8,373
Commercial Loans [Member] | Land [Member] | Greater than 90 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	9	34
Commercial Loans [Member] | Construction [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Current Loans	96,765	68,158
Total loans	96,765	68,158
Commercial Loans [Member] | Secured [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	346	361
Current Loans	161,763	94,982
Total loans	162,109	95,343
Commercial Loans [Member] | Secured [Member] | 30-59 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	135
Commercial Loans [Member] | Secured [Member] | 60-89 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	22
Commercial Loans [Member] | Secured [Member] | Greater than 90 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	189	361
Commercial Loans [Member] | Unsecured [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Current Loans	8,649	7,386
Total loans	8,649	7,386
Residential Mortgage Loans [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	9,873	10,952
Current Loans	881,422	787,669
Total loans	891,295	798,621
Residential Mortgage Loans [Member] | 30-59 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	2,643	3,774
Residential Mortgage Loans [Member] | 60-89 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	1,584	1,717
Residential Mortgage Loans [Member] | Greater than 90 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	5,646	5,461
Residential Mortgage Loans [Member] | Construction [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Current Loans	56,946	35,695
Total loans	56,946	35,695
Residential Mortgage Loans [Member] | One-to Four-Family [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	9,873	10,952
Current Loans	824,476	751,974
Total loans	834,349	762,926
Residential Mortgage Loans [Member] | One-to Four-Family [Member] | 30-59 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	2,643	3,774
Residential Mortgage Loans [Member] | One-to Four-Family [Member] | 60-89 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	1,584	1,717
Residential Mortgage Loans [Member] | One-to Four-Family [Member] | Greater than 90 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	5,646	5,461
Consumer Loans [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	3,563	3,952
Current Loans	247,588	212,646
Total loans	251,151	216,598
Consumer Loans [Member] | 30-59 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	1,465	1,203
Consumer Loans [Member] | 60-89 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	385	808
Consumer Loans [Member] | Greater than 90 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	1,713	1,941
Consumer Loans [Member] | Home Equity [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	2,683	3,068
Current Loans	185,079	161,986
Total loans	187,762	165,054
Consumer Loans [Member] | Home Equity [Member] | 30-59 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	1,141	941
Consumer Loans [Member] | Home Equity [Member] | 60-89 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	113	458
Consumer Loans [Member] | Home Equity [Member] | Greater than 90 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	1,429	1,669
Consumer Loans [Member] | Automobile [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	259	133
Current Loans	50,130	39,476
Total loans	50,389	39,609
Consumer Loans [Member] | Automobile [Member] | 30-59 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	123	130
Consumer Loans [Member] | Automobile [Member] | 60-89 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	119
Consumer Loans [Member] | Automobile [Member] | Greater than 90 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	17	3
Consumer Loans [Member] | Marine [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	169	267
Current Loans	1,432	1,529
Total loans	1,601	1,796
Consumer Loans [Member] | Marine [Member] | Greater than 90 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	169	267
Consumer Loans [Member] | Recreational Vehicle [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	443	478
Current Loans	5,958	7,124
Total loans	6,401	7,602
Consumer Loans [Member] | Recreational Vehicle [Member] | 30-59 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	199	131
Consumer Loans [Member] | Recreational Vehicle [Member] | 60-89 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	149	347
Consumer Loans [Member] | Recreational Vehicle [Member] | Greater than 90 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	95
Consumer Loans [Member] | Other [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	9	6
Current Loans	4,989	2,531
Total loans	4,998	2,537
Consumer Loans [Member] | Other [Member] | 30-59 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	2	1
Consumer Loans [Member] | Other [Member] | 60-89 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	4	3
Consumer Loans [Member] | Other [Member] | Greater than 90 Days Past Due [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Total Past Due	$ 3	$ 2

XML

Loans - Additional Information (Detail)	3 Months Ended		6 Months Ended
	Jun. 30, 2017 USD ($) Loan	Jun. 30, 2016 USD ($) Loan	Jun. 30, 2017 USD ($) Loan	Jun. 30, 2016 USD ($) Loan	Mar. 31, 2017 USD ($)	Dec. 31, 2016 USD ($)	Mar. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)
Accounts Notes And Loans Receivable [Line Items]
Allowance for loan losses	$ 19,660,000	$ 17,172,000	$ 19,660,000	$ 17,172,000	$ 18,970,000	$ 19,087,000	$ 16,903,000	$ 17,712,000
Number of loans modified as troubled debt restructurings | Loan	0	4	2	8
Amounts charged off	$ 435,000	$ 507,000	$ 2,305,000	$ 3,694,000
Troubled debt restructuring period past due considered payment default				30 days
Period of cumulative homogeneous loans past due included in company analysis			90 days
Troubled Debt Restructuring [Member]
Accounts Notes And Loans Receivable [Line Items]
Recorded investment in trouble debt restructuring	22,200,000		$ 22,200,000			26,600,000
Allowance for loan losses	1,600,000		1,600,000			3,000,000
Commitment to lend additional amounts	35,000		35,000			$ 31,000
Increment in allowance for loan losses	0	6,000	6,000	$ 11,000
Amounts charged off	0	0	0	0
TDRs with Subsequent Default [Member]
Accounts Notes And Loans Receivable [Line Items]
Increment in allowance for loan losses	0	0	0	0
Amounts charged off	$ 0	$ 0	$ 0	$ 0

XML

Loans - Loans by Class Modified as Troubled Debt Restructurings (Detail) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017 Loan	Jun. 30, 2016 USD ($) Loan	Jun. 30, 2017 USD ($) Loan	Jun. 30, 2016 USD ($) Loan
Financing Receivable Modifications [Line Items]
Number of Loans | Loan	0	4	2	8
Pre-Modification Outstanding Recorded Investment		$ 4,207	$ 190	$ 4,534
Post-Modification Recorded Investment		$ 4,212	$ 199	$ 4,557
Commercial Loans [Member]
Financing Receivable Modifications [Line Items]
Number of Loans | Loan		1		2
Pre-Modification Outstanding Recorded Investment		$ 4,000		$ 4,088
Post-Modification Recorded Investment		$ 4,000		$ 4,088
Commercial Loans [Member] | Nonresidential [Member]
Financing Receivable Modifications [Line Items]
Number of Loans | Loan		1		2
Pre-Modification Outstanding Recorded Investment		$ 4,000		$ 4,088
Post-Modification Recorded Investment		$ 4,000		$ 4,088
Residential Mortgage Loans [Member]
Financing Receivable Modifications [Line Items]
Number of Loans | Loan		1	1	3
Pre-Modification Outstanding Recorded Investment		$ 97	$ 75	$ 316
Post-Modification Recorded Investment		$ 98	$ 84	$ 335
Residential Mortgage Loans [Member] | One-to Four-Family [Member]
Financing Receivable Modifications [Line Items]
Number of Loans | Loan		1	1	3
Pre-Modification Outstanding Recorded Investment		$ 97	$ 75	$ 316
Post-Modification Recorded Investment		$ 98	$ 84	$ 335
Consumer Loans [Member]
Financing Receivable Modifications [Line Items]
Number of Loans | Loan		2	1	3
Pre-Modification Outstanding Recorded Investment		$ 110	$ 115	$ 130
Post-Modification Recorded Investment		$ 114	$ 115	$ 134
Consumer Loans [Member] | Home Equity [Member]
Financing Receivable Modifications [Line Items]
Number of Loans | Loan		2		3
Pre-Modification Outstanding Recorded Investment		$ 110		$ 130
Post-Modification Recorded Investment		$ 114		$ 134
Consumer Loans [Member] | Recreational Vehicle [Member]
Financing Receivable Modifications [Line Items]
Number of Loans | Loan			1
Pre-Modification Outstanding Recorded Investment			$ 115
Post-Modification Recorded Investment			$ 115

XML

Loans - Loans by Class Modified as Troubled Debt Restructurings with Payment Default (Detail) $ in Thousands	6 Months Ended
	Jun. 30, 2017 USD ($) Loan
Financing Receivable Modifications [Line Items]
Number of loans | Loan	2
Recorded Investment | $	$ 211
Residential Mortgage Loans [Member]
Financing Receivable Modifications [Line Items]
Number of loans | Loan	1
Recorded Investment | $	$ 164
Residential Mortgage Loans [Member] | One-to Four-Family [Member]
Financing Receivable Modifications [Line Items]
Number of loans | Loan	1
Recorded Investment | $	$ 164
Consumer Loans [Member]
Financing Receivable Modifications [Line Items]
Number of loans | Loan	1
Recorded Investment | $	$ 47
Consumer Loans [Member] | Home Equity [Member]
Financing Receivable Modifications [Line Items]
Number of loans | Loan	1
Recorded Investment | $	$ 47

XML

Loans - Risk Category of Loans by Class of Loans (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Financing Receivable Recorded Investment [Line Items]
Total loans	$ 1,884,701	$ 1,519,477
Unclassified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	1,831,785	1,485,074
Special Mention [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	18,711	13,126
Substandard [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	34,205	21,277
Classified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	34,205	21,277
Commercial Loans [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	742,255	504,258
Commercial Loans [Member] | Unclassified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	700,593	480,216
Commercial Loans [Member] | Special Mention [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	17,932	13,021
Commercial Loans [Member] | Substandard [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	23,730	11,021
Commercial Loans [Member] | Classified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	23,730	11,021
Commercial Loans [Member] | Multifamily [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	121,565	93,597
Commercial Loans [Member] | Multifamily [Member] | Unclassified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	117,375	89,468
Commercial Loans [Member] | Multifamily [Member] | Special Mention [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	3,482	3,564
Commercial Loans [Member] | Multifamily [Member] | Substandard [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	708	565
Commercial Loans [Member] | Multifamily [Member] | Classified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	708	565
Commercial Loans [Member] | Nonresidential [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	342,300	231,401
Commercial Loans [Member] | Nonresidential [Member] | Unclassified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	333,010	217,204
Commercial Loans [Member] | Nonresidential [Member] | Special Mention [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	3,208	6,037
Commercial Loans [Member] | Nonresidential [Member] | Substandard [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	6,082	8,160
Commercial Loans [Member] | Nonresidential [Member] | Classified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	6,082	8,160
Commercial Loans [Member] | Land [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	10,867	8,373
Commercial Loans [Member] | Land [Member] | Unclassified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	10,858	8,339
Commercial Loans [Member] | Land [Member] | Substandard [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	9	34
Commercial Loans [Member] | Land [Member] | Classified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	9	34
Commercial Loans [Member] | Construction [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	96,765	68,158
Commercial Loans [Member] | Construction [Member] | Unclassified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	96,362	68,158
Commercial Loans [Member] | Construction [Member] | Special Mention [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	403
Commercial Loans [Member] | Secured [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	162,109	95,343
Commercial Loans [Member] | Secured [Member] | Unclassified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	134,433	89,756
Commercial Loans [Member] | Secured [Member] | Special Mention [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	10,839	3,420
Commercial Loans [Member] | Secured [Member] | Substandard [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	16,837	2,167
Commercial Loans [Member] | Secured [Member] | Classified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	16,837	2,167
Commercial Loans [Member] | Unsecured [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	8,649	7,386
Commercial Loans [Member] | Unsecured [Member] | Unclassified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	8,555	7,291
Commercial Loans [Member] | Unsecured [Member] | Substandard [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	94	95
Commercial Loans [Member] | Unsecured [Member] | Classified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	94	95
Residential Mortgage Loans [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	891,295	798,621
Residential Mortgage Loans [Member] | Unclassified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	882,216	790,691
Residential Mortgage Loans [Member] | Special Mention [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	779	104
Residential Mortgage Loans [Member] | Substandard [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	8,300	7,826
Residential Mortgage Loans [Member] | Classified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	8,300	7,826
Residential Mortgage Loans [Member] | Construction [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	56,946	35,695
Residential Mortgage Loans [Member] | Construction [Member] | Unclassified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	56,946	35,695
Residential Mortgage Loans [Member] | One-to Four-Family [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	834,349	762,926
Residential Mortgage Loans [Member] | One-to Four-Family [Member] | Unclassified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	825,270	754,996
Residential Mortgage Loans [Member] | One-to Four-Family [Member] | Special Mention [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	779	104
Residential Mortgage Loans [Member] | One-to Four-Family [Member] | Substandard [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	8,300	7,826
Residential Mortgage Loans [Member] | One-to Four-Family [Member] | Classified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	8,300	7,826
Consumer Loans [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	251,151	216,598
Consumer Loans [Member] | Unclassified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	248,976	214,167
Consumer Loans [Member] | Special Mention [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans		1
Consumer Loans [Member] | Substandard [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	2,175	2,430
Consumer Loans [Member] | Classified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	2,175	2,430
Consumer Loans [Member] | Home Equity [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	187,762	165,054
Consumer Loans [Member] | Home Equity [Member] | Unclassified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	186,055	163,101
Consumer Loans [Member] | Home Equity [Member] | Substandard [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	1,707	1,953
Consumer Loans [Member] | Home Equity [Member] | Classified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	1,707	1,953
Consumer Loans [Member] | Auto [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	50,389	39,609
Consumer Loans [Member] | Auto [Member] | Unclassified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	50,258	39,577
Consumer Loans [Member] | Auto [Member] | Special Mention [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans		1
Consumer Loans [Member] | Auto [Member] | Substandard [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	131	31
Consumer Loans [Member] | Auto [Member] | Classified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	131	31
Consumer Loans [Member] | Marine [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	1,601	1,796
Consumer Loans [Member] | Marine [Member] | Unclassified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	1,432	1,530
Consumer Loans [Member] | Marine [Member] | Substandard [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	169	266
Consumer Loans [Member] | Marine [Member] | Classified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	169	266
Consumer Loans [Member] | Recreational Vehicle [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	6,401	7,602
Consumer Loans [Member] | Recreational Vehicle [Member] | Unclassified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	6,234	7,424
Consumer Loans [Member] | Recreational Vehicle [Member] | Substandard [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	167	178
Consumer Loans [Member] | Recreational Vehicle [Member] | Classified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	167	178
Consumer Loans [Member] | Other [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	4,998	2,537
Consumer Loans [Member] | Other [Member] | Unclassified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	4,997	2,535
Consumer Loans [Member] | Other [Member] | Substandard [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	1	2
Consumer Loans [Member] | Other [Member] | Classified [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans	$ 1	$ 2

XML

Loans - Schedule of Purchased Credit Impaired Loans for which Payments Would Not be Collected (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Financing Receivable Impaired [Line Items]
Total loans	$ 1,884,701	$ 1,519,477
Purchased credit impairment loans, Net carrying amount	1,869,095	1,503,577
Commercial Loans [Member]
Financing Receivable Impaired [Line Items]
Total loans	742,255	504,258
Residential Mortgage Loans [Member]
Financing Receivable Impaired [Line Items]
Total loans	891,295	798,621
Consumer Loans [Member]
Financing Receivable Impaired [Line Items]
Total loans	251,151	$ 216,598
Purchased Credit Impaired Loans [Member]
Financing Receivable Impaired [Line Items]
Total loans	1,221
Purchased credit impairment loans, Net carrying amount	1,221
Purchased Credit Impaired Loans [Member] | Commercial Loans [Member]
Financing Receivable Impaired [Line Items]
Total loans	$ 1,221

XML

Loans - Schedule of Purchased Credit Impaired Loans for which Payments Would Not be Collected (Parenthetical) (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2015
Financing Receivable Impaired [Line Items]
Allowance for loan losses	$ 19,660	$ 18,970	$ 19,087	$ 17,172	$ 16,903	$ 17,712
Purchased Credit Impaired Loans [Member]
Financing Receivable Impaired [Line Items]
Allowance for loan losses	$ 0

XML

Loans - Accretable Yield or Income Expected to be Collected (Detail) - Purchased Credit Impaired Loans [Member] - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2017
Financing Receivable Impaired [Line Items]
Beginning of period	$ 128
New loans purchased		$ 158
Accretion of income	12	42
Ending Balance	$ 116	$ 116

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Loans - Schedule of Purchased Credit Impaired Loans Purchased at Acquitision (Detail) - Purchased Credit Impaired Loans [Member] $ in Thousands	Jun. 30, 2017 USD ($)
Financing Receivable Impaired [Line Items]
Contractually required payments receivable of loans purchased during the year	$ 4,499
Cash flow expected to be collected at acquisition	1,955
Fair value of acquired loans at acquisition	1,797
Commercial Loans [Member]
Financing Receivable Impaired [Line Items]
Contractually required payments receivable of loans purchased during the year	$ 4,499

XML

Loans - Carrying Amount of Purchased Credit Impaired Loans (Detail) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Financing Receivable Impaired [Line Items]
Beginning Balance	$ 1,503,577
Loans purchased during the year	27,039	$ 15,693
Ending Balance	1,869,095
Purchased Credit Impaired Loans [Member]
Financing Receivable Impaired [Line Items]
Loans purchased during the year	1,797
Ending Balance	$ 1,221

XML

Mortgage Banking Activities - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Mortgage Loan Activity [Line Items]
Mortgage loans serviced for others	$ 1,200,000	$ 1,200,000
Fair value of mortgage servicing rights	10,300	10,200
Private Investor [Member]
Mortgage Loan Activity [Line Items]
Mortgage loans serviced for others	27,917
Private Investor [Member] | Adjustable Rate Residential Mortgages [Member] | One-to Four-Family [Member]
Mortgage Loan Activity [Line Items]
Mortgage loans serviced for others	$ 27,900
Percentage of mortgage service release premium as part of gain recognized on sale	0.45%
FHLMC, FNMA and Private Investor [Member]
Mortgage Loan Activity [Line Items]
Customer escrow balances	$ 12,100	$ 14,300

XML

Mortgage Banking Activities - Principal Balances of Mortgage Servicing Rights (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Mortgage loan portfolios serviced for:
Mortgage loans serviced for others	$ 1,200,000	$ 1,200,000
FHLMC [Member]
Mortgage loan portfolios serviced for:
Mortgage loans serviced for others	963,748	956,278
FNMA [Member]
Mortgage loan portfolios serviced for:
Mortgage loans serviced for others	213,848	$ 208,114
Private Investor [Member]
Mortgage loan portfolios serviced for:
Mortgage loans serviced for others	$ 27,917

XML

Mortgage Banking Activities - Capitalized Mortgage Servicing Rights (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2015
Mortgage Banking [Abstract]
Balance, beginning of period	$ 5,977	$ 5,727	$ 6,070	$ 5,686
Originations	670	653	1,026	1,162
Amortized to expense	(486)	(567)	(935)	(1,035)
Balance, end of period	6,161	5,813	6,161	5,813
Less valuation allowance	(5)	(766)	(5)	(766)	$ (3)	$ (474)	$ (39)
Net balance	$ 6,156	$ 5,047	$ 6,156	$ 5,047

XML

Mortgage Banking Activities - Valuation Allowance for Mortgage Servicing Rights (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Mortgage Banking [Abstract]
Balance, beginning of period	$ (3)	$ (474)		$ (39)
Impairment charges	(2)	(292)	$ (5)	(727)
Balance, end of period	$ (5)	$ (766)	$ (5)	$ (766)

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Mortgage Banking Activities - Key Economic Assumptions in Measuring Value of Mortgage Servicing Rights (Detail)	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Mortgage Banking [Abstract]
Weighted average prepayment rate	178.00%	165.00%
Weighted average life (in years)	6 years 4 months 17 days	6 years 7 months 21 days
Weighted average discount rate	9.06%	9.00%

XML

Other Real Estate Owned and Other Repossessed Assets - Real Estate Owned and Other Repossessed Assets (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2015
Other Real Estate And Foreclosed Assets [Abstract]
Real estate owned and other repossessed assets	$ 1,586		$ 2,789
Valuation allowance	(389)	$ (549)	(1,012)	$ (1,001)	$ (1,124)	$ (1,229)
End of period	$ 1,197		$ 1,777

XML

Other Real Estate Owned and Other Repossessed Assets - Valuation Allowance Related to Real Estate Owned (Detail) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Other Real Estate And Foreclosed Assets [Abstract]
Beginning of period	$ 549,000	$ 1,124,000	$ 1,012,000	$ 1,229,000
Recovery of expense	0	(27,000)	(38,000)	(26,000)
Reductions due to sales	(160,000)	(96,000)	(585,000)	(202,000)
End of period	$ 389,000	$ 1,001,000	$ 389,000	$ 1,001,000

XML

Other Real Estate Owned and Other Repossessed Assets - Expenses Related to Foreclosed and Repossessed Assets (Detail) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Other Real Estate And Foreclosed Assets [Abstract]
Net loss on sales	$ 18,000	$ 90,000	$ 108,000	$ 102,000
Provision for unrealized (gains) losses , net	0	(27,000)	(38,000)	(26,000)
Operating expenses, net of rental income	23,000	77,000	85,000	149,000
Total expenses	$ 41,000	$ 140,000	$ 155,000	$ 225,000

XML

Fair Value Measurement - Additional Information (Detail) - USD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Increase in fair value			$ 250,000
Derivative instrument maximum maturity period			30 years
Transfers between level 1 and level 2			$ 0		$ 0
Fair value of the collateral dependent loans, net carrying amount	$ 1,400,000	$ 8,200,000	1,400,000	$ 8,200,000	4,000,000
Specific allowance for collateral dependent loans	5,000	1,000,000	$ 5,000	1,000,000	1,300,000
Discount applied to appraisals for estimated selling costs percentage			10.00%
Mortgage servicing rights carried at fair value, valuation allowance net change during the period			$ 5,000	766,000
Net impairment reflected in other income	2,000	292,000	5,000	727,000
Other real estate owned carried at fair value	483,000	1,000,000	483,000	1,000,000	1,000,000
Valuation allowance related to other real estate owned	389,000	1,000,000	389,000	1,000,000	1,000,000
Recovery of expense	0	(27,000)	$ (38,000)	(26,000)
Maximum maturity period of short term borrowings			90 days
Collateral Dependent Loans [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Increase (decrease) in provision for loan losses	252,000	592,000	$ 479,000	3,600,000
Mortgage Servicing Rights [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Mortgage servicing rights carried at fair value	87,000	$ 2,800,000	87,000	$ 2,800,000
Construction [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Fair value option, loans held as assets, aggregate amount in nonaccrual status	$ 0		$ 0		$ 0

XML

Fair Value Measurement - Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Available for sale securities, Fair value	$ 287,179	$ 343,284
Loans held for sale, at fair value	85,954	62,593
Fair Value, Measurements, Recurring [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Loans held for sale, at fair value	85,954	62,593
Purchased certificate of deposit option	746	882
Written certificate of deposit option	746	882
Fair Value, Measurements, Recurring [Member] | U.S. Treasury and Government Sponsored Entities' Securities [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Available for sale securities, Fair value	134,603	186,033
Fair Value, Measurements, Recurring [Member] | States of the U.S. and Political Subdivisions [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Available for sale securities, Fair value	58,824	57,757
Fair Value, Measurements, Recurring [Member] | Mortgage-Backed GSE Securities: Residential [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Available for sale securities, Fair value	93,752	99,494
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Loans held for sale, at fair value	15,959	8,832
Purchased certificate of deposit option	746	882
Written certificate of deposit option	746	882
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | U.S. Treasury and Government Sponsored Entities' Securities [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Available for sale securities, Fair value	134,603	186,033
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | States of the U.S. and Political Subdivisions [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Available for sale securities, Fair value	58,824	57,757
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Mortgage-Backed GSE Securities: Residential [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Available for sale securities, Fair value	93,752	99,494
Fair Value, Measurements, Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Loans held for sale, at fair value	$ 69,995	$ 53,761

XML

Fair Value Measurement - Reconciliation of All Assets Measured at Fair Value on Recurring Basis Using Significant Unobservable Inputs (Level 3) (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items]
Included in change in fair value of loans held for sale			$ 2,900	$ 1,649
Loans Held For Sale [Member]
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items]
Balance of recurring Level 3 assets at beginning of period	$ 67,439	$ 26,760	53,761	26,716
Included in change in fair value of loans held for sale	1,822	622	2,412	1,291
Included in other comprehensive income				0
Originations/Draws on construction perm loans	25,945	19,132	51,245	35,819
Amortization				0
Sales	(25,211)	(12,909)	(37,423)	(30,221)
Balance of recurring Level 3 assets at end of period	$ 69,995	$ 33,605	$ 69,995	$ 33,605

XML

Fair Value Measurement - Quantitative Information About Level 3 Fair Value Measurements for Financial Instruments Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Fair Value Inputs Assets Quantitative Information [Line Items]
Loans held for sale, at fair value	$ 85,954	$ 62,593
Fair Value, Measurements, Recurring [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Loans held for sale, at fair value	85,954	62,593
Fair Value, Measurements, Recurring [Member] | Comparable Sales [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Loans held for sale, at fair value	$ 69,995	$ 53,761
Fair Value, Measurements, Recurring [Member] | Minimum [Member] | Comparable Sales [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Fair Value Inputs, Time discount	0.00%	0.00%
Fair Value, Measurements, Recurring [Member] | Maximum [Member] | Comparable Sales [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Fair Value Inputs, Time discount	1.80%	1.80%

XML

Fair Value Measurement - Assets and Liabilities Measured at Fair Value on Non-recurring Basis (Detail) - USD ($)	Jun. 30, 2017	Dec. 31, 2016	Jun. 30, 2016
Mortgage Servicing Rights [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Mortgage servicing rights	$ 87,000		$ 2,800,000
Fair Value, Measurements, Nonrecurring [Member] | Multifamily [Member] | Commercial Loans [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Impaired loans	418,000
Fair Value, Measurements, Nonrecurring [Member] | Home Equity [Member] | Consumer Loans [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Impaired loans	28,000	$ 228,000
Fair Value, Measurements, Nonrecurring [Member] | Auto [Member] | Consumer Loans [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Impaired loans	17,000	177,000
Fair Value, Measurements, Nonrecurring [Member] | Marine [Member] | Consumer Loans [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Impaired loans	169,000
Fair Value, Measurements, Nonrecurring [Member] | Recreational Vehicle [Member] | Consumer Loans [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Impaired loans	55,000	89,000
Fair Value, Measurements, Nonrecurring [Member] | Mortgage Servicing Rights [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Mortgage servicing rights	82,000
Fair Value, Measurements, Nonrecurring [Member] | Construction [Member] | Commercial Loans [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Other real estate owned, net	448,000	748,000
Fair Value, Measurements, Nonrecurring [Member] | Nonresidential [Member] | Commercial Loans [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Impaired loans		2,257,000
Fair Value, Measurements, Nonrecurring [Member] | Secured [Member] | Commercial Loans [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Impaired loans		284,000
Residential Mortgage Loans [Member] | Fair Value, Measurements, Nonrecurring [Member] | One-to Four-Family [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Impaired loans	756,000	919,000
Other real estate owned, net	35,000	281,000
Significant Other Observable Inputs (Level 2) [Member] | Fair Value, Measurements, Nonrecurring [Member] | Mortgage Servicing Rights [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Mortgage servicing rights	82,000
Significant Unobservable Inputs (Level 3) [Member] | Fair Value, Measurements, Nonrecurring [Member] | Multifamily [Member] | Commercial Loans [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Impaired loans	418,000
Significant Unobservable Inputs (Level 3) [Member] | Fair Value, Measurements, Nonrecurring [Member] | Home Equity [Member] | Consumer Loans [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Impaired loans	28,000	228,000
Significant Unobservable Inputs (Level 3) [Member] | Fair Value, Measurements, Nonrecurring [Member] | Auto [Member] | Consumer Loans [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Impaired loans	17,000	177,000
Significant Unobservable Inputs (Level 3) [Member] | Fair Value, Measurements, Nonrecurring [Member] | Marine [Member] | Consumer Loans [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Impaired loans	169,000
Significant Unobservable Inputs (Level 3) [Member] | Fair Value, Measurements, Nonrecurring [Member] | Recreational Vehicle [Member] | Consumer Loans [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Impaired loans	55,000	89,000
Significant Unobservable Inputs (Level 3) [Member] | Fair Value, Measurements, Nonrecurring [Member] | Construction [Member] | Commercial Loans [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Other real estate owned, net	448,000	748,000
Significant Unobservable Inputs (Level 3) [Member] | Fair Value, Measurements, Nonrecurring [Member] | Nonresidential [Member] | Commercial Loans [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Impaired loans		2,257,000
Significant Unobservable Inputs (Level 3) [Member] | Fair Value, Measurements, Nonrecurring [Member] | Secured [Member] | Commercial Loans [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Impaired loans		284,000
Significant Unobservable Inputs (Level 3) [Member] | Residential Mortgage Loans [Member] | Fair Value, Measurements, Nonrecurring [Member] | One-to Four-Family [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Impaired loans	756,000	919,000
Other real estate owned, net	$ 35,000	$ 281,000

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Fair Value Measurement - Quantitative Information About Level 3 Fair Value Measurements for Financial Instruments Measured at Fair Value on Nonrecurring Basis (Detail) - Fair Value, Measurements, Nonrecurring [Member] - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Impaired Loans [Member] | Multifamily [Member] | Commercial Loans [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Fair Value	$ 418
Impaired Loans [Member] | Multifamily [Member] | Commercial Loans [Member] | Minimum [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales	0.00%
Impaired Loans [Member] | Multifamily [Member] | Commercial Loans [Member] | Maximum [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales	35.00%
Impaired Loans [Member] | Multifamily [Member] | Commercial Loans [Member] | Weighted Average [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales	15.00%
Impaired Loans [Member] | Home Equity [Member] | Consumer Loans [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Fair Value	$ 28	$ 228
Impaired Loans [Member] | Home Equity [Member] | Consumer Loans [Member] | Minimum [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales	0.00%	0.00%
Impaired Loans [Member] | Home Equity [Member] | Consumer Loans [Member] | Maximum [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales	17.85%	17.85%
Impaired Loans [Member] | Home Equity [Member] | Consumer Loans [Member] | Weighted Average [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales	8.93%	8.93%
Impaired Loans [Member] | Marine [Member] | Consumer Loans [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Fair Value	$ 169
Impaired Loans [Member] | Marine [Member] | Consumer Loans [Member] | Minimum [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales	0.00%
Impaired Loans [Member] | Marine [Member] | Consumer Loans [Member] | Maximum [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales	37.00%
Impaired Loans [Member] | Marine [Member] | Consumer Loans [Member] | Weighted Average [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales	37.00%
Impaired Loans [Member] | Nonresidential [Member] | Commercial Loans [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Fair Value		$ 2,257
Impaired Loans [Member] | Nonresidential [Member] | Commercial Loans [Member] | Minimum [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales		0.00%
Impaired Loans [Member] | Nonresidential [Member] | Commercial Loans [Member] | Maximum [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales		35.00%
Impaired Loans [Member] | Nonresidential [Member] | Commercial Loans [Member] | Weighted Average [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales		15.00%
Impaired Loans [Member] | Secured [Member] | Commercial Loans [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Fair Value		$ 284
Impaired Loans [Member] | Secured [Member] | Commercial Loans [Member] | Minimum [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales		0.00%
Impaired Loans [Member] | Secured [Member] | Commercial Loans [Member] | Maximum [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales		64.00%
Impaired Loans [Member] | Secured [Member] | Commercial Loans [Member] | Weighted Average [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales		16.00%
Impaired Loans [Member] | Residential Mortgage Loans [Member] | One-to Four-Family [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Fair Value	$ 756	$ 919
Impaired Loans [Member] | Residential Mortgage Loans [Member] | One-to Four-Family [Member] | Minimum [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales	0.00%	0.00%
Impaired Loans [Member] | Residential Mortgage Loans [Member] | One-to Four-Family [Member] | Maximum [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales	10.77%	10.77%
Impaired Loans [Member] | Residential Mortgage Loans [Member] | One-to Four-Family [Member] | Weighted Average [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales	4.27%	4.27%
Other Real Estate Owned [Member] | Construction [Member] | Commercial Loans [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Fair Value	$ 448	$ 748
Other Real Estate Owned [Member] | Construction [Member] | Commercial Loans [Member] | Minimum [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales	0.00%	0.00%
Other Real Estate Owned [Member] | Construction [Member] | Commercial Loans [Member] | Minimum [Member] | Cost Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales		0.00%
Other Real Estate Owned [Member] | Construction [Member] | Commercial Loans [Member] | Maximum [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales	80.00%	90.40%
Other Real Estate Owned [Member] | Construction [Member] | Commercial Loans [Member] | Maximum [Member] | Cost Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales		33.33%
Other Real Estate Owned [Member] | Construction [Member] | Commercial Loans [Member] | Weighted Average [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales	24.03%	27.46%
Other Real Estate Owned [Member] | Construction [Member] | Commercial Loans [Member] | Weighted Average [Member] | Cost Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales		16.67%
Other Real Estate Owned [Member] | Residential Mortgage Loans [Member] | One-to Four-Family [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Fair Value	$ 35	$ 281
Other Real Estate Owned [Member] | Residential Mortgage Loans [Member] | One-to Four-Family [Member] | Minimum [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales	0.00%	0.00%
Other Real Estate Owned [Member] | Residential Mortgage Loans [Member] | One-to Four-Family [Member] | Maximum [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales	3.77%	27.00%
Other Real Estate Owned [Member] | Residential Mortgage Loans [Member] | One-to Four-Family [Member] | Weighted Average [Member] | Sales Comparison Approach [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Adjustment for differences between comparable sales	3.77%	7.74%

XML

Fair Value Measurement - Fair Value Option for Newly Originated Residential Mortgage and Permanent Construction Loans Held for Sale (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Fair Value Inputs Assets Quantitative Information [Line Items]
Aggregate fair value	$ 85,954	$ 62,593
Construction [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Aggregate fair value	85,954	62,593
Contractual balance	83,304	62,843
Gain (loss)	$ 2,650	$ (250)

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Fair Value Measurement - Amount of Gains and Losses from Changes in Fair Value Included in Earnings (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Fair Value Inputs Assets Quantitative Information [Line Items]
Change in fair value			$ 2,900	$ 1,649
Construction [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Change in fair value	$ 2,149	$ 845	2,900	1,649
Total change in fair value	$ 2,149	$ 845	$ 2,900	$ 1,649

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Fair Value Measurement - Carrying Value and Estimated Fair Values of Financial Instruments (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016	Jun. 30, 2016	Dec. 31, 2015
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Cash and cash equivalents, Carrying Value	$ 52,014	$ 45,887	$ 41,187	$ 35,910
Available for sale securities, Fair value	287,179	343,284
Held to maturity securities, Carrying Value	88,559	97,519
Loans held for sale at lower of cost or market, Carrying Value	199	165
Loans held for sale, at fair value	85,954	62,593
Loans, net, Carrying Value	1,869,095	1,503,577
FHLB stock, Carrying Value	19,324	18,068
Accrued interest receivable, Carrying Value	7,420	6,900
FHLB advances, Carrying Value	(328,146)	(390,756)
Advance payments by borrowers for taxes and insurance, Carrying Value	(21,989)	(23,812)
Accrued interest payable, Carrying Value	(392)	(145)
Held to maturity securities, Fair value	87,775	96,150
Reported Value Measurement [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Cash and cash equivalents, Carrying Value	52,014	45,887
Available for sale securities, Fair value	287,179	343,284
Held to maturity securities, Carrying Value	88,559	97,519
Loans held for sale at lower of cost or market, Carrying Value	199	165
Loans held for sale, at fair value	85,954	62,593
Loans, net, Carrying Value	1,869,095	1,503,577
FHLB stock, Carrying Value	19,324	18,068
Accrued interest receivable, Carrying Value	7,420	6,900
Purchased certificate of deposit option, Carrying Value	746	882
Checking, savings and money market accounts, Carrying Value	(1,252,227)	(1,026,565)
Certificates of deposit, Carrying Value	(641,766)	(488,426)
FHLB advances, Carrying Value	(328,146)	(390,756)
Repurchase agreements and other, Carrying Value	(8,045)	(512)
Advance payments by borrowers for taxes and insurance, Carrying Value	(21,989)	(23,812)
Accrued interest payable, Carrying Value	(392)	(145)
Written certificate of deposit option, Carrying Value	(746)	(882)
Estimate of Fair Value Measurement [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Cash and cash equivalents, Fair Value	52,014	45,887
Checking, savings and money market accounts, Fair Value	(1,252,227)	(1,026,565)
Advance payments by borrowers for taxes and insurance, Fair Value	(21,989)	(23,812)
Estimate of Fair Value Measurement [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Available for sale securities, Fair value	287,179	343,284
Loans held for sale, at fair value	15,959	8,832
Held to maturity securities, Fair value	87,775	92,940
Loans held for sale, Carrying Value	205	169
Accrued interest receivable, Fair Value	2,225	2,624
Purchased certificate of deposit option, Fair Value	746	882
Certificates of deposit, Fair Value	(642,416)	(491,278)
FHLB advances, Fair Value	(328,151)	(390,750)
Repurchase agreements and other, Fair Value	(7,837)	(513)
Accrued interest payable, Fair Value	(392)	(145)
Written certificate of deposit option, Fair Value	(746)	(882)
Estimate of Fair Value Measurement [Member] | Significant Unobservable Inputs (Level 3) [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Loans held for sale, at fair value	69,995	53,761
Held to maturity securities, Fair value		3,210
Loans, net, Fair Value	1,864,169	1,494,534
Accrued interest receivable, Fair Value	$ 5,195	$ 4,276

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Statement of Cash Flows Supplemental Disclosure - Supplemental Disclosures of Cash Flow Information (Detail) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Supplemental Cash Flow Information [Line Items]
Interest on deposits and borrowings	$ 5,396	$ 4,166
Income taxes	250	150
Supplemental schedule of noncash activities:
Transfers from loans to real estate owned and other repossessed assets	282	534
Transfers from loans to loans held for sale	27,921
Transfers from premises and equipment to other assets, held for sale	1,720
Accretion of securities held to maturity	100	109
James & Sons Insurance Company [Member]
Supplemental schedule of noncash activities:
Issuance of common stock		$ 1,508
Ohio Legacy Corp. [Member]
Supplemental schedule of noncash activities:
Issuance of common stock	25,816
Net assets acquired excluding cash and cash equivalents	$ 36

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Earnings Per Share - Additional Information (Detail) - shares	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Stock Option [Member]
Earnings Per Common Share [Line Items]
Number of anti-dilutive shares related to stock options	0	0	0	71,391

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Earnings Per Share - Computation of Earnings Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Earnings Per Share [Abstract]
Net income per consolidated statements of income	$ 8,189	$ 5,330	$ 9,727	$ 8,650
Net income allocated to participating securities	(49)	(40)	(61)	(55)
Net income allocated to common stock	8,140	5,290	9,666	8,595
Distributed earnings allocated to common stock	1,483	1,180	2,962	2,368
Undistributed earnings allocated to common stock	6,657	4,110	6,704	6,227
Net income allocated to common stock	$ 8,140	$ 5,290	$ 9,666	$ 8,595
Weighted average common shares outstanding, including shares considered participating securities	49,691	47,223	49,158	47,405
Less: Average participating securities	(299)	(354)	(309)	(299)
Weighted average shares	49,392	46,869	48,849	47,106
Basic earnings per common share	$ 0.16	$ 0.11	$ 0.20	$ 0.18
Weighted average common shares outstanding for basic earnings per common share	49,392	46,869	48,849	47,106
Add: Dilutive effects of assumed exercises of stock options and LTIP awards	403	248	398	247
Weighted average shares and dilutive potential common shares	49,795	47,117	49,247	47,353
Diluted earnings per common share	$ 0.16	$ 0.11	$ 0.20	$ 0.18

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Other Comprehensive Income (Loss) - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2014
Equity [Abstract]
Reclassification of net gains or (losses) included in other comprehensive income	$ 301	$ 233	$ 330	$ 386
Effect of disproportionate tax on accumulated other comprehensive income (loss)					$ (16,600)

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Other Comprehensive Income (Loss) - Other Comprehensive Income (Loss) Components and Related Tax Effects (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Accumulated Other Comprehensive Income Loss [Line Items]
Balance			$ 249,806	$ 244,245
Other comprehensive income before reclassifications	$ 1,758	$ 4,594	2,742	11,122
Amortization of unrealized gains of postretirement plan recognized in other comprehensive income		(181)		(362)
Accretion of unrealized losses of securities transferred from available for sale to held to maturity recognized in other comprehensive income	32	37	65	71
Reclassification adjustment for gains realized in income	(196)	(152)	(215)	(251)
Total other comprehensive income	1,594	4,298	2,592	10,580
Balance	285,480	254,075	285,480	254,075
Unrealized Gains (Losses) on Securities Available for Sale [Member]
Accumulated Other Comprehensive Income Loss [Line Items]
Balance	(2,165)	3,937	(3,130)	(2,492)
Other comprehensive income before reclassifications	1,758	4,594	2,742	11,122
Reclassification adjustment for gains realized in income	(196)	(152)	(215)	(251)
Total other comprehensive income	1,562	4,442	2,527	10,871
Balance	(603)	8,379	(603)	8,379
Disproportionate Tax Effect from Securities Available for Sale [Member]
Accumulated Other Comprehensive Income Loss [Line Items]
Balance	(17,110)	(17,110)	(17,110)	(17,110)
Balance	(17,110)	(17,110)	(17,110)	(17,110)
Losses on Securities Transferred From Available for Sale to Held to Maturity [Member]
Accumulated Other Comprehensive Income Loss [Line Items]
Balance	(767)	(926)	(800)	(960)
Accretion of unrealized losses of securities transferred from available for sale to held to maturity recognized in other comprehensive income	32	37	65	71
Total other comprehensive income	32	37	65	71
Balance	(735)	(889)	(735)	(889)
Accumulated Other Comprehensive Income (Loss) [Member]
Accumulated Other Comprehensive Income Loss [Line Items]
Balance	(20,042)	(12,938)	(21,040)	(19,220)
Total other comprehensive income			2,592	10,580
Balance	$ (18,448)	(8,640)	$ (18,448)	(8,640)
Unrealized Gains (Losses) from Postretirement Plan [Member]
Accumulated Other Comprehensive Income Loss [Line Items]
Balance		650		831
Amortization of unrealized gains of postretirement plan recognized in other comprehensive income		(181)		(362)
Total other comprehensive income		(181)		(362)
Balance		469		469
Disproportionate Tax Effect from Postretirement Plan [Member]
Accumulated Other Comprehensive Income Loss [Line Items]
Balance		511		511
Balance		$ 511		$ 511

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Other Comprehensive Income (Loss) - Summary of Reclassification Out of Each Component of Accumulated Comprehensive Income (Loss) (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income On Derivatives [Line Items]
Net gains on securities available for sale	$ 301	$ 233	$ 330	$ 386
Reduction in salaries & employee benefits	0	(278)	0	(556)
Tax expense	(3,377)	(2,529)	(3,934)	(4,121)
Net income	8,189	5,330	9,727	8,650
Amount Reclassified From Accumulated Other Comprehensive Income [Member]
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income On Derivatives [Line Items]
Net income	(196)	(333)	(215)	(613)
Amount Reclassified From Accumulated Other Comprehensive Income [Member] | Unrealized Gains (Losses) on Securities Available for Sale [Member]
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income On Derivatives [Line Items]
Net gains on securities available for sale	(301)	(233)	(330)	(386)
Tax expense	$ 105	81	$ 115	135
Net income		(152)		(251)
Amount Reclassified From Accumulated Other Comprehensive Income [Member] | Amortization of Postretirement Benefits Prior Service Costs [Member]
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income On Derivatives [Line Items]
Reduction in salaries & employee benefits		(278)		(556)
Tax expense		97		194
Net income		$ (181)		$ (362)

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Regulatory Capital Requirements - Additional Information (Detail)	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Dec. 31, 2017
Compliance With Regulatory Capital Requirements Under Banking Regulations [Line Items]
Capital adequacy requirements	The Basel III Capital Rules establish a common equity Tier 1 minimum capital requirement (4.5% of risk-weighted assets), a minimum Tier 1 capital to risk-based assets requirement (6% of risk-weighted assets) and assigns a risk weight (150%) to exposures that are more than 90 days past due or are on nonaccrual status and to certain commercial real estate facilities that finance the acquisition, development or construction of real property. The rules also require unrealized gains and losses on certain available-for-sale securities holdings to be included for purposes of calculating regulatory capital requirements unless a one-time opt-in or opt-out is exercised. In connection with the adoption of the Basel III Capital Rules, United Community and Home Savings elected to opt-out of the requirement to include most components of accumulated other comprehensive income in Common Equity Tier 1. The rule limits a banking organization’s capital distributions and certain discretionary bonus payments if the banking organization does not hold a “capital conservation buffer” consisting of 2.5% of common equity Tier 1 capital risk-based weighted assets in addition to the amount necessary to meeting its minimum risk-based capital requirements.
Scenario Forecast [Member]
Compliance With Regulatory Capital Requirements Under Banking Regulations [Line Items]
Capital conservation buffer rate		1.25%

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Regulatory Capital Requirements - Actual and Statutory Required Capital Amounts and Ratios (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
United Community [Member]
Compliance With Regulatory Capital Requirements Under Banking Regulations [Line Items]
Total capital (to risk-weighted assets), Actual Amount	$ 293,814	$ 277,817
Tier 1 capital (to risk-weighted assets), Actual Amount	274,154	258,869
Common equity Tier 1 capital (to risk-weighted assets), Actual Amount	274,154	258,869
Tier 1 capital (to average assets), Actual Amount	$ 274,154	$ 258,869
Total capital (to risk-weighted assets), Actual Ratio	15.66%	18.38%
Tier 1 capital (to risk-weighted assets), Actual Ratio	14.61%	17.13%
Common equity Tier 1 capital (to risk-weighted assets), Actual Ratio	14.61%	17.13%
Tier 1 capital (to average assets), Actual Ratio	10.76%	11.98%
Total capital (to risk-weighted assets), Minimum Capital Requirements Amount	$ 173,548	$ 130,369
Tier 1 capital (to risk-weighted assets), Minimum Capital Requirements Amount	136,024	100,139
Common equity Tier 1 capital (to risk-weighted assets), Minimum Capital Requirements Amount	107,881	77,466
Tier 1 capital (to average assets), Minimum Capital Requirements Amount	$ 101,870	$ 86,425
Total capital (to risk-weighted assets), Minimum Capital Requirements Ratio	9.25%	8.625%
Tier 1 capital (to risk-weighted assets), Minimum Capital Requirements Ratio	7.25%	6.625%
Common equity Tier 1 capital (to risk-weighted assets), Minimum Capital Requirements Ratio	5.75%	5.125%
Tier 1 capital (to average assets), Minimum Capital Requirements Ratio	4.00%	4.00%
Home Savings [Member]
Compliance With Regulatory Capital Requirements Under Banking Regulations [Line Items]
Total capital (to risk-weighted assets), Actual Amount	$ 277,583	$ 248,861
Tier 1 capital (to risk-weighted assets), Actual Amount	257,947	229,938
Common equity Tier 1 capital (to risk-weighted assets), Actual Amount	257,947	229,938
Tier 1 capital (to average assets), Actual Amount	$ 257,947	$ 229,938
Total capital (to risk-weighted assets), Actual Ratio	14.83%	16.47%
Tier 1 capital (to risk-weighted assets), Actual Ratio	13.78%	15.22%
Common equity Tier 1 capital (to risk-weighted assets), Actual Ratio	13.78%	15.22%
Tier 1 capital (to average assets), Actual Ratio	10.14%	10.65%
Total capital (to risk-weighted assets), Minimum Capital Requirements Amount	$ 173,129	$ 130,292
Tier 1 capital (to risk-weighted assets), Minimum Capital Requirements Amount	135,695	100,079
Common equity Tier 1 capital (to risk-weighted assets), Minimum Capital Requirements Amount	107,621	77,420
Tier 1 capital (to average assets), Minimum Capital Requirements Amount	$ 101,794	$ 86,360
Total capital (to risk-weighted assets), Minimum Capital Requirements Ratio	9.25%	8.625%
Tier 1 capital (to risk-weighted assets), Minimum Capital Requirements Ratio	7.25%	6.625%
Common equity Tier 1 capital (to risk-weighted assets), Minimum Capital Requirements Ratio	5.75%	5.125%
Tier 1 capital (to average assets), Minimum Capital Requirements Ratio	4.00%	4.00%
Total capital (to risk-weighted assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount	$ 187,166	$ 151,063
Tier 1 capital (to risk-weighted assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount	149,733	120,850
Common equity Tier 1 capital (to risk-weighted assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount	121,658	98,191
Tier 1 capital (to average assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount	$ 127,242	$ 107,950
Total capital (to risk-weighted assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio	10.00%	10.00%
Tier 1 capital (to risk-weighted assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio	8.00%	8.00%
Common equity Tier 1 capital (to risk-weighted assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio	6.50%	6.50%
Tier 1 capital (to average assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio	5.00%	5.00%

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Regulatory Capital Requirements - Components of Regulatory Capital (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016	Jun. 30, 2016	Dec. 31, 2015
Compliance With Regulatory Capital Requirements Under Banking Regulations [Line Items]
Total shareholders' equity	$ 285,480	$ 249,806	$ 254,075	$ 244,245
Accumulated other comprehensive income	(18,448)	(21,040)
United Community [Member]
Compliance With Regulatory Capital Requirements Under Banking Regulations [Line Items]
Total shareholders' equity	285,480	249,806
Accumulated other comprehensive income	18,463	21,040
Intangible assets	(21,352)	(1,567)
Disallowed deferred tax assets	(8,437)	(10,410)
Tier 1 Capital	274,154	258,869
Allowance for loan losses and allowance for unfunded lending commitments limited to 1.25% of total risk-weighted assets	19,660	18,948
Total risk-based capital	293,814	277,817
Home Savings [Member]
Compliance With Regulatory Capital Requirements Under Banking Regulations [Line Items]
Total shareholders' equity	264,512	216,475
Accumulated other comprehensive income	18,463	21,056
Intangible assets	(20,313)	(3)
Disallowed deferred tax assets	(4,715)	(7,590)
Tier 1 Capital	257,947	229,938
Allowance for loan losses and allowance for unfunded lending commitments limited to 1.25% of total risk-weighted assets	19,636	18,923
Total risk-based capital	$ 277,583	$ 248,861

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Regulatory Capital Requirements - Components of Regulatory Capital (Parenthetical) (Detail)	Jun. 30, 2017	Dec. 31, 2016
United Community [Member]
Compliance With Regulatory Capital Requirements Under Banking Regulations [Line Items]
Allowance for loan and allowance for unfunded lending commitments, percentage of risk-weighted assets	1.25%	1.25%
Home Savings [Member]
Compliance With Regulatory Capital Requirements Under Banking Regulations [Line Items]
Allowance for loan and allowance for unfunded lending commitments, percentage of risk-weighted assets	1.25%	1.25%

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Income Taxes - Significant Components of Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Deferred tax assets:
Loan loss reserves	$ 6,881	$ 6,680
Depreciation	886	748
Other real estate owned valuation	136	354
Tax credits carryforward	1,845	1,471
Unrealized loss on securities available for sale	324	1,685
Unrealized loss on securities held to maturity	396	431
Interest on nonaccrual loans	952	1,039
Net operating loss carryforward	6,593	8,574
Purchase accounting adjustment	1,000
Accrued bonuses	756	812
Other	79	221
Deferred tax assets	19,848	22,015
Deferred tax liabilities:
Deferred loan fees	1,622	1,275
Federal Home Loan Bank stock dividends	4,645	4,585
Mortgage servicing rights	2,155	2,124
FHLB prepayment penalty	649	786
Purchase accounting adjustment		371
Prepaid expenses	671	139
Deferred tax liabilities	9,742	9,280
Net deferred tax asset	$ 10,106	$ 12,735

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Income Taxes - Additional Information (Detail) - USD ($)	6 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Income Tax Disclosure [Abstract]
Net deferred tax asset	$ 10,106,000	$ 12,735,000
Operating loss carryforwards used against taxable income	$ 18,800,000
Expiration dates, operating loss carried forward	Dec. 31, 2030
Alternative minimum tax credits carried forward	$ 1,800,000

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Income Taxes - Summary of Difference in Effective Tax Rates and Statutory Federal Income Tax Rate of 35% (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Income Tax Disclosure [Abstract]
Tax at statutory rate, amount	$ 4,048	$ 2,751	$ 4,781	$ 4,470
Tax exempt income, amount	(166)	(124)	(337)	(187)
Life insurance, amount	(137)	(128)	(269)	(256)
Stock compensation, amount	(138)		(198)
Other, amount	(230)	30	(43)	94
Income tax provision, total amount	$ 3,377	$ 2,529	$ 3,934	$ 4,121
Tax at statutory rate, rate	35.00%	35.00%	35.00%	35.00%
Tax exempt income, rate	(1.44%)	(1.57%)	(2.47%)	(1.47%)
Life insurance, rate	(1.18%)	(1.63%)	(1.97%)	(2.00%)
Stock compensation, rate	(1.19%)		(1.45%)
Other, rate	(1.99%)	0.38%	(0.31%)	0.74%
Income tax provision, total rate	29.20%	32.18%	28.80%	32.27%

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Goodwill and Intangible Assets - Change in Goodwill (Detail) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Goodwill [Line Items]
Beginning of the year	$ 208
End of the year	19,467	$ 208
James & Sons Insurance Company [Member]
Goodwill [Line Items]
Effect of adjustments	636
Acquired goodwill		$ 208
OLCB [Member]
Goodwill [Line Items]
Effect of adjustments	15
Acquired goodwill	18,420
Eich Brothers Insurance [Member]
Goodwill [Line Items]
Acquired goodwill	$ 188

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Goodwill and Intangible Assets - Additional Information (Detail)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2017 USD ($)	Jun. 30, 2016 USD ($)	Jun. 30, 2017 USD ($) ReportingUnit	Jun. 30, 2016 USD ($)	Dec. 31, 2016 USD ($) ReportingUnit
Goodwill And Intangible Assets [Line Items]
Number of reporting units with carrying amount of zero or less than zero | ReportingUnit			0		0
Carrying amount of reporting unit	$ 0		$ 0		$ 0
Amortization of intangible assets	113,000	$ 10,000	196,000	$ 23,000
Maximum [Member]
Goodwill And Intangible Assets [Line Items]
Carrying amount of reporting unit	$ 0		$ 0		$ 0

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Goodwill and Intangible Assets - Schedule of Acquired Intangible Assets (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Finite Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 13,346	$ 10,352
Accumulated Amortization	9,187	8,991
Core deposit intangibles [Member]
Finite Lived Intangible Assets [Line Items]
Gross Carrying Amount	11,184	8,952
Accumulated Amortization	9,085	8,947
Customer list intangible [Member]
Finite Lived Intangible Assets [Line Items]
Gross Carrying Amount	2,162	1,400
Accumulated Amortization	$ 102	$ 44

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Goodwill and Intangible Assets - Schedule of Acquired Intangible Assets - Core Deposit (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Finite Lived Intangible Assets [Line Items]
Amortization	$ (113)	$ (10)	$ (196)	$ (23)
Core deposit intangibles [Member]
Finite Lived Intangible Assets [Line Items]
Beginning of the year			5	$ 30	$ 30
Amortization			(138)		(25)
End of the period	$ 2,099		2,099		$ 5
Core deposit intangibles [Member] | OLCB [Member]
Finite Lived Intangible Assets [Line Items]
Acquired intangibles			$ 2,232

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Goodwill and Intangible Assets - Schedule of Acquired Intangible Assets - Customer List (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Finite Lived Intangible Assets [Line Items]
Amortization	$ (113)	$ (10)	$ (196)	$ (23)
Customer list intangible [Member]
Finite Lived Intangible Assets [Line Items]
Beginning of the year			1,356
Amortization			(58)		$ (44)
End of the period	$ 2,060		2,060		1,356
Customer list intangible [Member] | James & Sons Insurance Company [Member]
Finite Lived Intangible Assets [Line Items]
Effect of adjustments			(41)
Acquired intangibles					$ 1,400
Customer list intangible [Member] | OLCB [Member]
Finite Lived Intangible Assets [Line Items]
Acquired intangibles			268
Customer list intangible [Member] | Eich Brothers Insurance [Member]
Finite Lived Intangible Assets [Line Items]
Acquired intangibles			$ 535

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Goodwill and Intangible Assets - Estimated Amortization Expense (Detail)	Jun. 30, 2017 USD ($)
Intangible Assets Accumulated Amortization [Abstract]
Remainder of 2017	$ 224,000
2018	448,000
2019	448,000
2020	448,000
2021	448,000
2022	$ 448,000

XML

Qualified Affordable Housing Project Investments - Additional Information (Detail) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Schedule Of Equity Method Investments [Line Items]
Investment in qualified affordable housing projects	$ 6,000,000		$ 6,000,000		$ 3,000,000
Unfunded commitments of investments in qualified affordable housing projects	5,900,000		5,900,000		$ 2,900,000
Recognized amortization expense included in income tax expense	36,000	$ 0	90,000	$ 0
Recognized tax credits and other benefits from investment in affordable housing tax credits	44,000	0	110,000	0
Impairment losses related to investment in qualified affordable housing projects	$ 0	$ 0	$ 0	$ 0
Minimum [Member]
Schedule Of Equity Method Investments [Line Items]
Expected period for fulfillment of investment commitments			8 years
Maximum [Member]
Schedule Of Equity Method Investments [Line Items]
Expected period for fulfillment of investment commitments			10 years