FIRST FINANCIAL BANCORP. |
(Exact name of registrant as specified in its charter) |
Ohio | 31-1042001 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |
255 East Fifth Street, Suite 700 Cincinnati, Ohio | 45202 | |
(Address of principal executive offices) | (Zip Code) |
Large accelerated filer x | Accelerated filer o |
Non-accelerated filer o | Smaller reporting company o |
Class | Outstanding at November 7, 2016 | |
Common stock, No par value | 61,955,821 |
Page No. | |
the Act | Private Securities Litigation Reform Act | FDIC | Federal Deposit Insurance Corporation | |
ALLL | Allowance for loan and lease losses | FHLB | Federal Home Loan Bank | |
ASC | Accounting standards codification | First Financial | First Financial Bancorp. | |
ASU | Accounting standards update | First Financial Bank | First Financial Bank, N.A. | |
ATM | Automated teller machine | Form 10-K | First Financial Bancorp. Annual Report on Form 10-K | |
Bank | First Financial Bank, N.A. | GAAP | U.S. Generally Accepted Accounting Principles | |
Basel III | Basel Committee regulatory capital reforms, Third Basel Accord | IRLC | Interest Rate Lock Commitment | |
Bp/bps | Basis point(s) | N/A | Not applicable | |
CDs | Certificates of deposits | NII | Net interest income | |
Company | First Financial Bancorp. | Oak Street | Oak Street Holdings Corporation | |
ERM | Enterprise Risk Management | OREO | Other real estate owned | |
EVE | Economic value of equity | SEC | United States Securities and Exchange Commission | |
FASB | Financial Accounting Standards Board | TDR | Troubled debt restructuring | |
Fair Value Topic | FASB ASC Topic 825, Financial Instruments |
September 30, 2016 | December 31, 2015 | ||||||
(Unaudited) | |||||||
Assets | |||||||
Cash and due from banks | $ | 117,982 | $ | 114,841 | |||
Interest-bearing deposits with other banks | 16,765 | 33,734 | |||||
Investment securities available-for-sale, at fair value (amortized cost $1,110,784 at September 30, 2016 and $1,203,065 at December 31, 2015) | 1,120,494 | 1,190,642 | |||||
Investment securities held-to-maturity (fair value $645,751 at September 30, 2016 and $731,951 at December 31, 2015) | 628,497 | 726,259 | |||||
Other investments | 51,170 | 53,725 | |||||
Loans held for sale | 17,414 | 20,957 | |||||
Loans and leases | |||||||
Commercial and industrial | 1,782,782 | 1,663,102 | |||||
Lease financing | 96,046 | 93,986 | |||||
Construction real estate | 380,349 | 311,712 | |||||
Commercial real estate | 2,468,083 | 2,258,297 | |||||
Residential real estate | 507,715 | 512,311 | |||||
Home equity | 463,702 | 466,629 | |||||
Installment | 47,825 | 41,506 | |||||
Credit card | 43,009 | 41,217 | |||||
Total loans and leases | 5,789,511 | 5,388,760 | |||||
Less: Allowance for loan and lease losses | 57,618 | 53,398 | |||||
Net loans and leases | 5,731,893 | 5,335,362 | |||||
Premises and equipment | 132,082 | 136,603 | |||||
Goodwill and other intangibles | 210,888 | 211,865 | |||||
FDIC indemnification asset | 13,287 | 17,630 | |||||
Accrued interest and other assets | 328,009 | 305,793 | |||||
Total assets | $ | 8,368,481 | $ | 8,147,411 | |||
Liabilities | |||||||
Deposits | |||||||
Interest-bearing | $ | 1,494,529 | $ | 1,414,291 | |||
Savings | 2,005,407 | 1,945,805 | |||||
Time | 1,346,736 | 1,406,124 | |||||
Total interest-bearing deposits | 4,846,672 | 4,766,220 | |||||
Noninterest-bearing | 1,492,011 | 1,413,404 | |||||
Total deposits | 6,338,683 | 6,179,624 | |||||
Federal funds purchased and securities sold under agreements to repurchase | 77,936 | 89,325 | |||||
Federal Home Loan Bank short-term borrowings | 848,300 | 849,100 | |||||
Total short-term borrowings | 926,236 | 938,425 | |||||
Long-term debt | 119,549 | 119,540 | |||||
Total borrowed funds | 1,045,785 | 1,057,965 | |||||
Accrued interest and other liabilities | 122,876 | 100,446 | |||||
Total liabilities | 7,507,344 | 7,338,035 | |||||
Shareholders' equity | |||||||
Common stock - no par value | |||||||
Authorized - 160,000,000 shares; Issued - 68,730,731 shares in 2016 and 2015 | 569,199 | 571,155 | |||||
Retained earnings | 423,800 | 388,240 | |||||
Accumulated other comprehensive loss | (17,522 | ) | (30,580 | ) | |||
Treasury stock, at cost, 6,777,858 shares in 2016 and 7,089,051 shares in 2015 | (114,340 | ) | (119,439 | ) | |||
Total shareholders' equity | 861,137 | 809,376 | |||||
Total liabilities and shareholders' equity | $ | 8,368,481 | $ | 8,147,411 |
Three months ended | Nine months ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Interest income | |||||||||||||||
Loans, including fees | $ | 66,997 | $ | 58,694 | $ | 194,820 | $ | 167,744 | |||||||
Investment securities | |||||||||||||||
Taxable | 10,326 | 9,986 | 32,405 | 28,875 | |||||||||||
Tax-exempt | 1,083 | 1,163 | 3,401 | 3,419 | |||||||||||
Total interest on investment securities | 11,409 | 11,149 | 35,806 | 32,294 | |||||||||||
Other earning assets | (1,081 | ) | (1,168 | ) | (3,323 | ) | (3,511 | ) | |||||||
Total interest income | 77,325 | 68,675 | 227,303 | 196,527 | |||||||||||
Interest expense | |||||||||||||||
Deposits | 5,600 | 4,861 | 16,587 | 14,302 | |||||||||||
Short-term borrowings | 1,368 | 374 | 3,591 | 930 | |||||||||||
Long-term borrowings | 1,539 | 281 | 4,620 | 876 | |||||||||||
Total interest expense | 8,507 | 5,516 | 24,798 | 16,108 | |||||||||||
Net interest income | 68,818 | 63,159 | 202,505 | 180,419 | |||||||||||
Provision for loan and lease losses | 1,687 | 2,647 | 7,379 | 7,777 | |||||||||||
Net interest income after provision for loan and lease losses | 67,131 | 60,512 | 195,126 | 172,642 | |||||||||||
Noninterest income | |||||||||||||||
Service charges on deposit accounts | 5,056 | 4,934 | 13,892 | 14,260 | |||||||||||
Trust and wealth management fees | 3,236 | 3,134 | 9,959 | 10,042 | |||||||||||
Bankcard income | 2,984 | 2,909 | 8,996 | 8,501 | |||||||||||
Client derivative fees | 1,210 | 1,604 | 4,104 | 3,444 | |||||||||||
Net gains from sales of loans | 2,066 | 1,758 | 5,093 | 5,146 | |||||||||||
Net gains on sales of investment securities | 398 | 409 | 234 | 1,503 | |||||||||||
FDIC loss sharing income | (638 | ) | (973 | ) | (1,144 | ) | (2,323 | ) | |||||||
Accelerated discount on covered/formerly covered loans | 491 | 3,820 | 2,653 | 10,006 | |||||||||||
Other | 2,146 | 2,760 | 8,868 | 8,804 | |||||||||||
Total noninterest income | 16,949 | 20,355 | 52,655 | 59,383 | |||||||||||
Noninterest expenses | |||||||||||||||
Salaries and employee benefits | 32,093 | 27,768 | 91,234 | 82,160 | |||||||||||
Net occupancy | 4,543 | 4,510 | 13,991 | 13,895 | |||||||||||
Furniture and equipment | 2,139 | 2,165 | 6,482 | 6,537 | |||||||||||
Data processing | 2,828 | 2,591 | 8,311 | 8,020 | |||||||||||
Marketing | 641 | 810 | 2,507 | 2,671 | |||||||||||
Communication | 527 | 531 | 1,485 | 1,659 | |||||||||||
Professional services | 1,460 | 4,092 | 4,572 | 7,789 | |||||||||||
State intangible tax | 639 | 579 | 1,917 | 1,733 | |||||||||||
FDIC assessments | 1,048 | 1,103 | 3,292 | 3,307 | |||||||||||
Loss (gain) - other real estate owned | (112 | ) | 196 | (259 | ) | 1,089 | |||||||||
Loss sharing expense | 270 | 574 | 555 | 1,451 | |||||||||||
Other | 5,029 | 8,073 | 17,151 | 19,535 | |||||||||||
Total noninterest expenses | 51,105 | 52,992 | 151,238 | 149,846 | |||||||||||
Income before income taxes | 32,975 | 27,875 | 96,543 | 82,179 | |||||||||||
Income tax expense | 10,125 | 9,202 | 31,311 | 26,936 | |||||||||||
Net income | $ | 22,850 | $ | 18,673 | $ | 65,232 | $ | 55,243 | |||||||
Net earnings per common share - basic | $ | 0.37 | $ | 0.31 | $ | 1.07 | $ | 0.90 | |||||||
Net earnings per common share - diluted | $ | 0.37 | $ | 0.30 | $ | 1.05 | $ | 0.89 | |||||||
Cash dividends declared per share | $ | 0.16 | $ | 0.16 | $ | 0.48 | $ | 0.48 | |||||||
Average common shares outstanding - basic | 61,280,283 | 61,135,749 | 61,170,845 | 61,088,794 | |||||||||||
Average common shares outstanding - diluted | 62,086,067 | 61,987,795 | 61,962,961 | 61,858,724 |
FIRST FINANCIAL BANCORP. AND SUBSIDIARIES | |||||||||||||||
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||||||||||||||
(Dollars in thousands) | |||||||||||||||
(Unaudited) | |||||||||||||||
Three months ended | Nine months ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Net income | $ | 22,850 | $ | 18,673 | $ | 65,232 | $ | 55,243 | |||||||
Other comprehensive income (loss), net of tax: | |||||||||||||||
Unrealized gains (losses) on investment securities arising during the period | (162 | ) | 3,057 | 12,073 | 4,287 | ||||||||||
Change in retirement obligation | 200 | 220 | 601 | 624 | |||||||||||
Unrealized gain (loss) on derivatives | 128 | 128 | 384 | (771 | ) | ||||||||||
Unrealized gain (loss) on foreign currency exchange | 0 | 91 | 0 | 50 | |||||||||||
Other comprehensive income (loss) | 166 | 3,496 | 13,058 | 4,190 | |||||||||||
Comprehensive income | $ | 23,016 | $ | 22,169 | $ | 78,290 | $ | 59,433 | |||||||
See Notes to Consolidated Financial Statements. |
Common Stock | Common Stock | Retained | Accumulated other comprehensive | Treasury stock | |||||||||||||||||||||
Shares | Amount | Earnings | income (loss) | Shares | Amount | Total | |||||||||||||||||||
Balance at January 1, 2015 | 68,730,731 | $ | 574,643 | $ | 352,587 | $ | (21,409 | ) | (7,274,184 | ) | $ | (122,050 | ) | $ | 783,771 | ||||||||||
Net income | 55,243 | 55,243 | |||||||||||||||||||||||
Other comprehensive income (loss) | 4,190 | 4,190 | |||||||||||||||||||||||
Cash dividends declared: | |||||||||||||||||||||||||
Common stock at $0.48 per share | (29,572 | ) | (29,572 | ) | |||||||||||||||||||||
Purchase of common stock | (148,935 | ) | (2,783 | ) | (2,783 | ) | |||||||||||||||||||
Warrant exercises | (645 | ) | 39,217 | 658 | 13 | ||||||||||||||||||||
Excess tax benefit on share-based compensation | 85 | 85 | |||||||||||||||||||||||
Exercise of stock options, net of shares purchased | (195 | ) | 30,458 | 511 | 316 | ||||||||||||||||||||
Restricted stock awards, net of forfeitures | (6,869 | ) | 336,346 | 5,612 | (1,257 | ) | |||||||||||||||||||
Share-based compensation expense | 3,006 | 3,006 | |||||||||||||||||||||||
Balance at September 30, 2015 | 68,730,731 | $ | 570,025 | $ | 378,258 | $ | (17,219 | ) | (7,017,098 | ) | $ | (118,052 | ) | $ | 813,012 | ||||||||||
Balance at January 1, 2016 | 68,730,731 | $ | 571,155 | $ | 388,240 | $ | (30,580 | ) | (7,089,051 | ) | $ | (119,439 | ) | $ | 809,376 | ||||||||||
Net income | 65,232 | 65,232 | |||||||||||||||||||||||
Other comprehensive income (loss) | 13,058 | 13,058 | |||||||||||||||||||||||
Cash dividends declared: | |||||||||||||||||||||||||
Common stock at $0.48 per share | (29,672 | ) | (29,672 | ) | |||||||||||||||||||||
Warrant Exercises | (1,249 | ) | 74,079 | 1,249 | 0 | ||||||||||||||||||||
Excess tax benefit on share-based compensation | 225 | 225 | |||||||||||||||||||||||
Exercise of stock options, net of shares purchased | (328 | ) | 53,715 | 906 | 578 | ||||||||||||||||||||
Restricted stock awards, net of forfeitures | (4,506 | ) | 183,399 | 2,944 | (1,562 | ) | |||||||||||||||||||
Share-based compensation expense | 3,902 | 3,902 | |||||||||||||||||||||||
Balance at September 30, 2016 | 68,730,731 | $ | 569,199 | $ | 423,800 | $ | (17,522 | ) | (6,777,858 | ) | $ | (114,340 | ) | $ | 861,137 |
Nine months ended | |||||||
September 30, | |||||||
2016 | 2015 | ||||||
Operating activities | |||||||
Net income | $ | 65,232 | $ | 55,243 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Provision for loan and lease losses | 7,379 | 7,777 | |||||
Depreciation and amortization | 9,753 | 9,697 | |||||
Stock-based compensation expense | 3,902 | 3,006 | |||||
Pension expense (income) | (675 | ) | (900 | ) | |||
Net amortization of premiums/accretion of discounts on investment securities | 6,213 | 5,874 | |||||
Net gains on sales of investment securities | (234 | ) | (1,503 | ) | |||
Originations of loans held for sale | (172,950 | ) | (197,621 | ) | |||
Net gains from sales of loans held for sale | (5,093 | ) | (5,146 | ) | |||
Proceeds from sales of loans held for sale | 181,263 | 187,364 | |||||
Deferred income taxes | 271 | 2,954 | |||||
Bank owned life insurance income | (1,342 | ) | (1,314 | ) | |||
Decrease (increase) in interest receivable | (1,183 | ) | (1,912 | ) | |||
Decrease (increase) in indemnification asset | 4,343 | 3,735 | |||||
(Decrease) increase in interest payable | (1,480 | ) | 706 | ||||
Decrease (increase) in other assets | (21,301 | ) | (22,770 | ) | |||
(Decrease) increase in other liabilities | 2,634 | 16,136 | |||||
Net cash provided by (used in) operating activities | 76,732 | 61,326 | |||||
Investing activities | |||||||
Proceeds from sales of securities available-for-sale | 206,909 | 68,615 | |||||
Proceeds from calls, paydowns and maturities of securities available-for-sale | 119,437 | 88,336 | |||||
Purchases of securities available-for-sale | (225,117 | ) | (375,244 | ) | |||
Proceeds from sales of securities held-to-maturity | 4,862 | 0 | |||||
Proceeds from calls, paydowns and maturities of securities held-to-maturity | 89,529 | 111,499 | |||||
Purchases of securities held-to-maturity | 0 | (3,520 | ) | ||||
Net decrease (increase) in interest-bearing deposits with other banks | 16,969 | (1,561 | ) | ||||
Net decrease (increase) in loans and leases | (406,005 | ) | (213,936 | ) | |||
Proceeds from disposal of other real estate owned | 6,908 | 12,238 | |||||
Purchases of premises and equipment | (6,427 | ) | (6,371 | ) | |||
Life insurance premium payments | (4,006 | ) | (3,575 | ) | |||
Life insurance death benefits | 5,006 | 0 | |||||
Net cash (paid) acquired from business combinations | 0 | (305,591 | ) | ||||
Net cash provided by (used in) investing activities | (191,935 | ) | (629,110 | ) | |||
Financing activities | |||||||
Net (decrease) increase in total deposits | 159,059 | 425,686 | |||||
Net (decrease) increase in short-term borrowings | (12,189 | ) | 102,125 | ||||
Payments on long-term debt | (86 | ) | (46,238 | ) | |||
Proceeds from issuance of long-term debt | 0 | 120,000 | |||||
Cash dividends paid on common stock | (29,318 | ) | (29,282 | ) | |||
Treasury stock purchase | 0 | (2,783 | ) | ||||
Proceeds from exercise of stock options | 653 | 367 | |||||
Excess tax benefit on share-based compensation | 225 | 85 | |||||
Net cash provided by (used in) financing activities | 118,344 | 569,960 | |||||
Cash and due from banks | |||||||
Change in cash and due from banks | 3,141 | 2,176 | |||||
Cash and due from banks at beginning of period | 114,841 | 110,122 | |||||
Cash and due from banks at end of period | $ | 117,982 | $ | 112,298 |
Held-to-maturity | Available-for-sale | |||||||||||||||||||||||||||||||
(Dollars in thousands) | Amortized cost | Unrecognized gain | Unrecognized loss | Fair value | Amortized cost | Unrealized gain | Unrealized loss | Fair value | ||||||||||||||||||||||||
U.S. Treasuries | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 98 | $ | 4 | $ | 0 | $ | 102 | ||||||||||||||||
Securities of U.S. government agencies and corporations | 13,811 | 389 | 0 | 14,200 | 7,471 | 226 | 0 | 7,697 | ||||||||||||||||||||||||
Mortgage-backed securities | 591,224 | 16,639 | (337 | ) | 607,526 | 662,535 | 8,714 | (2,241 | ) | 669,008 | ||||||||||||||||||||||
Obligations of state and other political subdivisions | 23,462 | 563 | 0 | 24,025 | 119,168 | 3,574 | (502 | ) | 122,240 | |||||||||||||||||||||||
Asset-backed securities | 0 | 0 | 0 | 0 | 286,427 | 1,508 | (1,944 | ) | 285,991 | |||||||||||||||||||||||
Other securities | 0 | 0 | 0 | 0 | 35,085 | 935 | (564 | ) | 35,456 | |||||||||||||||||||||||
Total | $ | 628,497 | $ | 17,591 | $ | (337 | ) | $ | 645,751 | $ | 1,110,784 | $ | 14,961 | $ | (5,251 | ) | $ | 1,120,494 |
Held-to-maturity | Available-for-sale | |||||||||||||||||||||||||||||||
(Dollars in thousands) | Amortized cost | Unrecognized gain | Unrecognized loss | Fair value | Amortized cost | Unrealized gain | Unrealized loss | Fair value | ||||||||||||||||||||||||
U.S. Treasuries | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 98 | $ | 0 | $ | (1 | ) | $ | 97 | |||||||||||||||
Securities of U.S. government agencies and corporations | 15,486 | 121 | 0 | 15,607 | 8,183 | 157 | 0 | 8,340 | ||||||||||||||||||||||||
Mortgage-backed securities | 678,318 | 7,452 | (1,999 | ) | 683,771 | 775,285 | 2,708 | (12,926 | ) | 765,067 | ||||||||||||||||||||||
Obligations of state and other political subdivisions | 27,646 | 338 | (99 | ) | 27,885 | 105,212 | 2,655 | (730 | ) | 107,137 | ||||||||||||||||||||||
Asset-backed securities | 0 | 0 | 0 | 0 | 236,411 | 35 | (3,445 | ) | 233,001 | |||||||||||||||||||||||
Other securities | 4,809 | 0 | (121 | ) | 4,688 | 77,876 | 523 | (1,399 | ) | 77,000 | ||||||||||||||||||||||
Total | $ | 726,259 | $ | 7,911 | $ | (2,219 | ) | $ | 731,951 | $ | 1,203,065 | $ | 6,078 | $ | (18,501 | ) | $ | 1,190,642 |
Held-to-maturity | Available-for-sale | ||||||||||||||
(Dollars in thousands) | Amortized cost | Fair value | Amortized cost | Fair value | |||||||||||
Due in one year or less | $ | 10,329 | $ | 10,396 | $ | 84,668 | $ | 84,666 | |||||||
Due after one year through five years | 550,112 | 564,365 | 696,926 | 701,256 | |||||||||||
Due after five years through ten years | 68,056 | 70,990 | 282,745 | 287,263 | |||||||||||
Due after ten years | 0 | 0 | 46,445 | 47,309 | |||||||||||
Total | $ | 628,497 | $ | 645,751 | $ | 1,110,784 | $ | 1,120,494 |
September 30, 2016 | ||||||||||||||||||||||||
Less than 12 months | 12 months or more | Total | ||||||||||||||||||||||
(Dollars in thousands) | Fair value | Unrealized loss | Fair value | Unrealized loss | Fair value | Unrealized loss | ||||||||||||||||||
Mortgage-backed securities | $ | 97,408 | $ | (331 | ) | $ | 143,886 | $ | (2,247 | ) | $ | 241,294 | $ | (2,578 | ) | |||||||||
Obligations of state and other political subdivisions | 33,509 | (100 | ) | 12,515 | (402 | ) | 46,024 | (502 | ) | |||||||||||||||
Asset-backed securities | 51,613 | (179 | ) | 100,822 | (1,765 | ) | 152,435 | (1,944 | ) | |||||||||||||||
Other securities | 128 | 0 | 20,591 | (564 | ) | 20,719 | (564 | ) | ||||||||||||||||
Total | $ | 182,658 | $ | (610 | ) | $ | 277,814 | $ | (4,978 | ) | $ | 460,472 | $ | (5,588 | ) |
December 31, 2015 | ||||||||||||||||||||||||
Less than 12 months | 12 months or more | Total | ||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||
(Dollars in thousands) | value | loss | value | loss | value | loss | ||||||||||||||||||
U.S. Treasuries | $ | 97 | $ | (1 | ) | $ | 0 | $ | 0 | $ | 97 | $ | (1 | ) | ||||||||||
Mortgage-backed securities | 500,768 | (5,362 | ) | 246,523 | (9,563 | ) | 747,291 | (14,925 | ) | |||||||||||||||
Obligations of state and other political subdivisions | 5,800 | (65 | ) | 29,287 | (764 | ) | 35,087 | (829 | ) | |||||||||||||||
Asset-backed securities | 189,066 | (3,042 | ) | 17,144 | (403 | ) | 206,210 | (3,445 | ) | |||||||||||||||
Other securities | 30,828 | (592 | ) | 24,716 | (928 | ) | 55,544 | (1,520 | ) | |||||||||||||||
Total | $ | 726,559 | $ | (9,062 | ) | $ | 317,670 | $ | (11,658 | ) | $ | 1,044,229 | $ | (20,720 | ) |
Three months ended | Nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
(Dollars in thousands) | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Balance at beginning of period | $ | 56,819 | $ | 78,945 | $ | 64,857 | $ | 106,622 | ||||||||
Reclassification from/(to) nonaccretable difference | 36 | 76 | 3,756 | (2,048 | ) | |||||||||||
Accretion | (3,399 | ) | (4,945 | ) | (11,364 | ) | (17,046 | ) | ||||||||
Other net activity (1) | (2,022 | ) | (4,746 | ) | (5,815 | ) | (18,198 | ) | ||||||||
Balance at end of period | $ | 51,434 | $ | 69,330 | $ | 51,434 | $ | 69,330 |
As of September 30, 2016 | ||||||||||||||||||||
Commercial | Real Estate | Lease | ||||||||||||||||||
(Dollars in thousands) | and industrial | Construction | Commercial | financing | Total | |||||||||||||||
Pass | $ | 1,714,538 | $ | 380,199 | $ | 2,385,796 | $ | 95,157 | $ | 4,575,690 | ||||||||||
Special Mention | 19,000 | 0 | 17,043 | 128 | 36,171 | |||||||||||||||
Substandard | 49,244 | 150 | 65,244 | 761 | 115,399 | |||||||||||||||
Doubtful | 0 | 0 | 0 | 0 | 0 | |||||||||||||||
Total | $ | 1,782,782 | $ | 380,349 | $ | 2,468,083 | $ | 96,046 | $ | 4,727,260 |
(Dollars in thousands) | Residential real estate | Home equity | Installment | Other | Total | |||||||||||||||
Performing | $ | 498,429 | $ | 459,115 | $ | 47,441 | $ | 43,009 | $ | 1,047,994 | ||||||||||
Nonperforming | 9,286 | 4,587 | 384 | 0 | 14,257 | |||||||||||||||
Total | $ | 507,715 | $ | 463,702 | $ | 47,825 | $ | 43,009 | $ | 1,062,251 |
As of December 31, 2015 | ||||||||||||||||||||
Commercial | Real Estate | Lease | ||||||||||||||||||
(Dollars in thousands) | and industrial | Construction | Commercial | financing | Total | |||||||||||||||
Pass | $ | 1,596,415 | $ | 310,806 | $ | 2,179,701 | $ | 93,236 | $ | 4,180,158 | ||||||||||
Special Mention | 27,498 | 128 | 19,903 | 0 | 47,529 | |||||||||||||||
Substandard | 39,189 | 778 | 58,693 | 750 | 99,410 | |||||||||||||||
Doubtful | 0 | 0 | 0 | 0 | 0 | |||||||||||||||
Total | $ | 1,663,102 | $ | 311,712 | $ | 2,258,297 | $ | 93,986 | $ | 4,327,097 |
(Dollars in thousands) | Residential real estate | Home equity | Installment | Other | Total | |||||||||||||||
Performing | $ | 503,317 | $ | 461,188 | $ | 41,253 | $ | 41,217 | $ | 1,046,975 | ||||||||||
Nonperforming | 8,994 | 5,441 | 253 | 0 | 14,688 | |||||||||||||||
Total | $ | 512,311 | $ | 466,629 | $ | 41,506 | $ | 41,217 | $ | 1,061,663 |
As of September 30, 2016 | ||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | 30 – 59 days past due | 60 – 89 days past due | > 90 days past due | Total past due | Current | Subtotal | Purchased impaired | Total | > 90 days past due and still accruing | |||||||||||||||||||||||||||
Loans | ||||||||||||||||||||||||||||||||||||
Commercial and industrial | $ | 1,310 | $ | 3,811 | $ | 2,142 | $ | 7,263 | $ | 1,769,726 | $ | 1,776,989 | $ | 5,793 | $ | 1,782,782 | $ | 0 | ||||||||||||||||||
Construction real estate | 0 | 0 | 0 | 0 | 379,661 | 379,661 | 688 | 380,349 | 0 | |||||||||||||||||||||||||||
Commercial real estate | 1,811 | 7,693 | 6,095 | 15,599 | 2,360,738 | 2,376,337 | 91,746 | 2,468,083 | 0 | |||||||||||||||||||||||||||
Residential real estate | 43 | 323 | 2,077 | 2,443 | 454,855 | 457,298 | 50,417 | 507,715 | 0 | |||||||||||||||||||||||||||
Home equity | 151 | 204 | 1,907 | 2,262 | 459,672 | 461,934 | 1,768 | 463,702 | 0 | |||||||||||||||||||||||||||
Installment | 97 | 14 | 217 | 328 | 46,034 | 46,362 | 1,463 | 47,825 | 0 | |||||||||||||||||||||||||||
Other | 474 | 145 | 255 | 874 | 138,181 | 139,055 | 0 | 139,055 | 130 | |||||||||||||||||||||||||||
Total | $ | 3,886 | $ | 12,190 | $ | 12,693 | $ | 28,769 | $ | 5,608,867 | $ | 5,637,636 | $ | 151,875 | $ | 5,789,511 | $ | 130 |
As of December 31, 2015 | ||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | 30 – 59 days past due | 60 – 89 days past due | > 90 days past due | Total past due | Current | Subtotal | Purchased impaired | Total | > 90 days past due and still accruing | |||||||||||||||||||||||||||
Loans | ||||||||||||||||||||||||||||||||||||
Commercial and industrial | $ | 2,255 | $ | 2,232 | $ | 1,937 | $ | 6,424 | $ | 1,648,902 | $ | 1,655,326 | $ | 7,776 | $ | 1,663,102 | $ | 0 | ||||||||||||||||||
Construction real estate | 0 | 17 | 0 | 17 | 310,872 | 310,889 | 823 | 311,712 | 0 | |||||||||||||||||||||||||||
Commercial real estate | 2,501 | 913 | 7,421 | 10,835 | 2,124,290 | 2,135,125 | 123,172 | 2,258,297 | 0 | |||||||||||||||||||||||||||
Residential real estate | 1,220 | 239 | 2,242 | 3,701 | 451,907 | 455,608 | 56,703 | 512,311 | 0 | |||||||||||||||||||||||||||
Home equity | 696 | 248 | 2,830 | 3,774 | 461,647 | 465,421 | 1,208 | 466,629 | 0 | |||||||||||||||||||||||||||
Installment | 197 | 111 | 48 | 356 | 39,206 | 39,562 | 1,944 | 41,506 | 0 | |||||||||||||||||||||||||||
Other | 920 | 302 | 230 | 1,452 | 133,751 | 135,203 | 0 | 135,203 | 108 | |||||||||||||||||||||||||||
Total | $ | 7,789 | $ | 4,062 | $ | 14,708 | $ | 26,559 | $ | 5,170,575 | $ | 5,197,134 | $ | 191,626 | $ | 5,388,760 | $ | 108 |
Three months ended | |||||||||||||||||||||
September 30, 2016 | September 30, 2015 | ||||||||||||||||||||
(Dollars in thousands) | Number of loans | Pre-modification loan balance | Period end balance | Number of loans | Pre-modification loan balance | Period end balance | |||||||||||||||
Commercial and industrial | 6 | $ | 1,045 | $ | 1,159 | 5 | $ | 171 | $ | 166 | |||||||||||
Construction real estate | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||
Commercial real estate | 5 | 3,550 | 3,531 | 2 | 2,159 | 2,000 | |||||||||||||||
Residential real estate | 0 | 0 | 0 | 6 | 920 | 901 | |||||||||||||||
Home equity | 1 | 16 | 16 | 6 | 231 | 229 | |||||||||||||||
Installment | 0 | 0 | 0 | 2 | 50 | 50 | |||||||||||||||
Total | 12 | $ | 4,611 | $ | 4,706 | 21 | $ | 3,531 | $ | 3,346 | |||||||||||
Nine months ended | |||||||||||||||||||||
September 30, 2016 | September 30, 2015 | ||||||||||||||||||||
(Dollars in thousands) | Number of loans | Pre-modification loan balance | Period end balance | Number of loans | Pre-modification loan balance | Period end balance | |||||||||||||||
Commercial and industrial | 16 | $ | 3,172 | $ | 3,290 | 27 | $ | 1,686 | $ | 1,676 | |||||||||||
Construction real estate | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||
Commercial real estate | 15 | 5,060 | 4,612 | 14 | 17,499 | 13,734 | |||||||||||||||
Residential real estate | 2 | 282 | 247 | 9 | 1,282 | 1,228 | |||||||||||||||
Home equity | 5 | 165 | 156 | 16 | 2,281 | 1,768 | |||||||||||||||
Installment | 3 | 9 | 9 | 9 | 96 | 96 | |||||||||||||||
Total | 41 | $ | 8,688 | $ | 8,314 | 75 | $ | 22,844 | $ | 18,502 |
Three months ended | Nine months ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
(Dollars in thousands) | 2016 | 2015 | 2016 | 2015 | |||||||||||
Extended maturities | $ | 1,831 | $ | 2,166 | $ | 2,352 | $ | 12,827 | |||||||
Adjusted interest rates | 0 | 0 | 0 | 0 | |||||||||||
Combination of rate and maturity changes | 2,744 | 0 | 2,906 | 1,219 | |||||||||||
Forbearance | 0 | 0 | 88 | 260 | |||||||||||
Other (1) | 131 | 1,180 | 2,968 | 4,196 | |||||||||||
Total | $ | 4,706 | $ | 3,346 | $ | 8,314 | $ | 18,502 |
(Dollars in thousands) | September 30, 2016 | December 31, 2015 | ||||||
Impaired loans | ||||||||
Nonaccrual loans (1) | ||||||||
Commercial and industrial | $ | 3,201 | $ | 8,405 | ||||
Construction real estate | 0 | 0 | ||||||
Commercial real estate | 5,985 | 9,418 | ||||||
Residential real estate | 4,759 | 5,027 | ||||||
Home equity | 3,815 | 4,898 | ||||||
Installment | 327 | 127 | ||||||
Other | 214 | 122 | ||||||
Nonaccrual loans (1) | 18,301 | 27,997 | ||||||
Accruing troubled debt restructurings | 32,164 | 28,876 | ||||||
Total impaired loans | $ | 50,465 | $ | 56,873 |
Three months ended | Nine months ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
(Dollars in thousands) | 2016 | 2015 | 2016 | 2015 | |||||||||||
Interest income effect on impaired loans | |||||||||||||||
Gross amount of interest that would have been recorded under original terms | $ | 705 | $ | 852 | $ | 2,173 | $ | 2,750 | |||||||
Interest included in income | |||||||||||||||
Nonaccrual loans | 97 | 91 | 269 | 370 | |||||||||||
Troubled debt restructurings | 224 | 168 | 665 | 436 | |||||||||||
Total interest included in income | 321 | 259 | 934 | 806 | |||||||||||
Net impact on interest income | $ | 384 | $ | 593 | $ | 1,239 | $ | 1,944 |
As of September 30, 2016 | ||||||||||||
(Dollars in thousands) | Current balance | Contractual principal balance | Related allowance | |||||||||
Loans with no related allowance recorded | ||||||||||||
Commercial and industrial | $ | 13,498 | $ | 14,448 | $ | 0 | ||||||
Construction real estate | 0 | 0 | 0 | |||||||||
Commercial real estate | 12,881 | 15,974 | 0 | |||||||||
Residential real estate | 8,090 | 9,373 | 0 | |||||||||
Home equity | 4,487 | 5,974 | 0 | |||||||||
Installment | 384 | 551 | 0 | |||||||||
Other | 214 | 214 | 0 | |||||||||
Total | 39,554 | 46,534 | 0 | |||||||||
Loans with an allowance recorded | ||||||||||||
Commercial and industrial | 1,301 | 1,301 | 777 | |||||||||
Construction real estate | 0 | 0 | 0 | |||||||||
Commercial real estate | 8,315 | 8,315 | 1,019 | |||||||||
Residential real estate | 1,195 | 1,195 | 179 | |||||||||
Home equity | 100 | 100 | 2 | |||||||||
Installment | 0 | 0 | 0 | |||||||||
Other | 0 | 0 | 0 | |||||||||
Total | 10,911 | 10,911 | 1,977 | |||||||||
Total | ||||||||||||
Commercial and industrial | 14,799 | 15,749 | 777 | |||||||||
Construction real estate | 0 | 0 | 0 | |||||||||
Commercial real estate | 21,196 | 24,289 | 1,019 | |||||||||
Residential real estate | 9,285 | 10,568 | 179 | |||||||||
Home equity | 4,587 | 6,074 | 2 | |||||||||
Installment | 384 | 551 | 0 | |||||||||
Other | 214 | 214 | 0 | |||||||||
Total | $ | 50,465 | $ | 57,445 | $ | 1,977 |
As of December 31, 2015 | ||||||||||||
(Dollars in thousands) | Current balance | Contractual principal balance | Related allowance | |||||||||
Loans with no related allowance recorded | ||||||||||||
Commercial and industrial | $ | 16,418 | $ | 17,398 | $ | 0 | ||||||
Construction real estate | 0 | 0 | 0 | |||||||||
Commercial real estate | 16,301 | 20,479 | 0 | |||||||||
Residential real estate | 7,447 | 8,807 | 0 | |||||||||
Home equity | 5,340 | 7,439 | 0 | |||||||||
Installment | 253 | 276 | 0 | |||||||||
Other | 122 | 122 | 0 | |||||||||
Total | 45,881 | 54,521 | 0 | |||||||||
Loans with an allowance recorded | ||||||||||||
Commercial and industrial | 993 | 1,178 | 357 | |||||||||
Construction real estate | 0 | 0 | 0 | |||||||||
Commercial real estate | 8,351 | 8,706 | 979 | |||||||||
Residential real estate | 1,547 | 1,560 | 235 | |||||||||
Home equity | 101 | 101 | 2 | |||||||||
Installment | 0 | 0 | 0 | |||||||||
Other | 0 | 0 | 0 | |||||||||
Total | 10,992 | 11,545 | 1,573 | |||||||||
Total | ||||||||||||
Commercial and industrial | 17,411 | 18,576 | 357 | |||||||||
Construction real estate | 0 | 0 | 0 | |||||||||
Commercial real estate | 24,652 | 29,185 | 979 | |||||||||
Residential real estate | 8,994 | 10,367 | 235 | |||||||||
Home equity | 5,441 | 7,540 | 2 | |||||||||
Installment | 253 | 276 | 0 | |||||||||
Other | 122 | 122 | 0 | |||||||||
Total | $ | 56,873 | $ | 66,066 | $ | 1,573 |
Three months ended | |||||||||||||||
September 30, 2016 | September 30, 2015 | ||||||||||||||
(Dollars in thousands) | Average Recorded Investment | Interest Income Recognized | Average Recorded Investment | Interest Income Recognized | |||||||||||
Commercial and industrial | $ | 14,243 | $ | 91 | $ | 10,847 | $ | 53 | |||||||
Construction real estate | 0 | 0 | 151 | 0 | |||||||||||
Commercial real estate | 21,067 | 144 | 31,631 | 131 | |||||||||||
Residential real estate | 9,186 | 59 | 9,119 | 53 | |||||||||||
Home equity | 4,736 | 24 | 396 | 20 | |||||||||||
Installment | 460 | 2 | 5,705 | 2 | |||||||||||
Other | 691 | 1 | 0 | 0 | |||||||||||
Total | $ | 50,383 | $ | 321 | $ | 57,849 | $ | 259 |
Nine months ended | |||||||||||||||
September 30, 2016 | September 30, 2015 | ||||||||||||||
(Dollars in thousands) | Average Recorded Investment | Interest Income Recognized | Average Recorded Investment | Interest Income Recognized | |||||||||||
Commercial and industrial | $ | 15,096 | $ | 258 | $ | 10,494 | $ | 169 | |||||||
Construction real estate | 0 | 0 | 187 | 0 | |||||||||||
Commercial real estate | 22,441 | 422 | 34,201 | 408 | |||||||||||
Residential real estate | 9,007 | 171 | 10,051 | 163 | |||||||||||
Home equity | 5,145 | 68 | 5,826 | 60 | |||||||||||
Installment | 348 | 5 | 412 | 6 | |||||||||||
Other | 406 | 10 | 0 | 0 | |||||||||||
Total | $ | 52,443 | $ | 934 | $ | 61,171 | $ | 806 |
Three months ended | Nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
(Dollars in thousands) | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Balance at beginning of period | $ | 9,302 | $ | 16,401 | $ | 12,525 | $ | 22,674 | ||||||||
Additions | ||||||||||||||||
Commercial and industrial | 936 | 178 | 1,824 | 2,745 | ||||||||||||
Residential real estate | 303 | 1,405 | 594 | 3,210 | ||||||||||||
Total additions | 1,239 | 1,583 | 2,418 | 5,955 | ||||||||||||
Disposals | ||||||||||||||||
Commercial and industrial | (2,670 | ) | (852 | ) | (4,763 | ) | (9,394 | ) | ||||||||
Residential real estate | (66 | ) | (1,708 | ) | (2,145 | ) | (2,844 | ) | ||||||||
Total disposals | (2,736 | ) | (2,560 | ) | (6,908 | ) | (12,238 | ) | ||||||||
Valuation adjustment | ||||||||||||||||
Commercial and industrial | (186 | ) | (183 | ) | (332 | ) | (963 | ) | ||||||||
Residential real estate | (42 | ) | (54 | ) | (126 | ) | (241 | ) | ||||||||
Total valuation adjustment | (228 | ) | (237 | ) | (458 | ) | (1,204 | ) | ||||||||
Balance at end of period | $ | 7,577 | $ | 15,187 | $ | 7,577 | $ | 15,187 |
Three months ended | Nine months ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
(Dollars in thousands) | 2016 | 2015 | 2016 | 2015 | Affected Line Item in the Consolidated Statements of Income | ||||||||||||
Balance at beginning of period | $ | 14,504 | $ | 20,338 | $ | 17,630 | $ | 22,666 | |||||||||
Adjustments not reflected in income | |||||||||||||||||
Net FDIC claims (received) / paid | 531 | 758 | 213 | 2,382 | |||||||||||||
Adjustments reflected in income | |||||||||||||||||
Amortization | (1,110 | ) | (1,192 | ) | (3,412 | ) | (3,562 | ) | Interest income, other earning assets | ||||||||
FDIC loss sharing income | (638 | ) | (973 | ) | (1,144 | ) | (2,323 | ) | Noninterest income, FDIC loss sharing income | ||||||||
Offset to accelerated discount | 0 | 0 | 0 | (232 | ) | Noninterest income, accelerated discount on covered loans | |||||||||||
Balance at end of period | $ | 13,287 | $ | 18,931 | $ | 13,287 | $ | 18,931 |
Three months ended | Nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
(Dollars in thousands) | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Changes in the allowance for loan and lease losses on loans, excluding covered/formerly covered loans | ||||||||||||||||
Balance at beginning of period | $ | 46,931 | $ | 42,128 | $ | 43,149 | $ | 42,820 | ||||||||
Provision for loan and lease losses | 1,886 | 1,382 | 7,381 | 6,114 | ||||||||||||
Loans charged-off | (1,131 | ) | (2,385 | ) | (4,547 | ) | (9,200 | ) | ||||||||
Recoveries | 1,206 | 1,194 | 2,909 | 2,585 | ||||||||||||
Balance at end of period | $ | 48,892 | $ | 42,319 | $ | 48,892 | $ | 42,319 | ||||||||
Changes in the allowance for loan and lease losses on covered/formerly covered loans | ||||||||||||||||
Balance at beginning of period | $ | 9,777 | $ | 10,748 | $ | 10,249 | $ | 10,038 | ||||||||
Provision for loan and lease losses | (199 | ) | 1,265 | (2 | ) | 1,663 | ||||||||||
Loans charged-off | (1,419 | ) | (1,577 | ) | (3,147 | ) | (5,078 | ) | ||||||||
Recoveries | 567 | 577 | 1,626 | 4,390 | ||||||||||||
Balance at end of period | $ | 8,726 | $ | 11,013 | $ | 8,726 | $ | 11,013 | ||||||||
Changes in the allowance for loan and lease losses | ||||||||||||||||
Balance at beginning of period | $ | 56,708 | $ | 52,876 | $ | 53,398 | $ | 52,858 | ||||||||
Provision for loan and lease losses | 1,687 | 2,647 | 7,379 | 7,777 | ||||||||||||
Loans charged-off | (2,550 | ) | (3,962 | ) | (7,694 | ) | (14,278 | ) | ||||||||
Recoveries | 1,773 | 1,771 | 4,535 | 6,975 | ||||||||||||
Balance at end of period | $ | 57,618 | $ | 53,332 | $ | 57,618 | $ | 53,332 |
Three months ended September 30, 2016 | ||||||||||||||||||||||||||||||||
Real Estate | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | Commercial and industrial | Construction | Commercial | Residential | Home Equity | Installment | Other | Total | ||||||||||||||||||||||||
Allowance for loan and lease losses: | ||||||||||||||||||||||||||||||||
Balance at beginning of period | $ | 20,897 | $ | 2,893 | $ | 22,784 | $ | 3,292 | $ | 3,002 | $ | 383 | $ | 3,457 | $ | 56,708 | ||||||||||||||||
Provision for loan and lease losses | (720 | ) | 232 | 2,628 | (13 | ) | 275 | 168 | (883 | ) | 1,687 | |||||||||||||||||||||
Gross charge-offs | (296 | ) | (64 | ) | (1,135 | ) | (90 | ) | (475 | ) | (223 | ) | (267 | ) | (2,550 | ) | ||||||||||||||||
Recoveries | 327 | 6 | 997 | 38 | 257 | 56 | 92 | 1,773 | ||||||||||||||||||||||||
Total net charge-offs | 31 | (58 | ) | (138 | ) | (52 | ) | (218 | ) | (167 | ) | (175 | ) | (777 | ) | |||||||||||||||||
Ending allowance for loan and lease losses | $ | 20,208 | $ | 3,067 | $ | 25,274 | $ | 3,227 | $ | 3,059 | $ | 384 | $ | 2,399 | $ | 57,618 |
Three months ended September 30, 2015 | ||||||||||||||||||||||||||||||||
Real Estate | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | Commercial and industrial | Construction | Commercial | Residential | Home Equity | Installment | Other | Total | ||||||||||||||||||||||||
Allowance for loan and lease losses: | ||||||||||||||||||||||||||||||||
Balance at beginning of period | $ | 16,775 | $ | 1,385 | $ | 24,357 | $ | 3,214 | $ | 4,386 | $ | 387 | $ | 2,372 | $ | 52,876 | ||||||||||||||||
Provision for loan and lease losses | 1,303 | 153 | (339 | ) | 1,224 | (724 | ) | 864 | 166 | 2,647 | ||||||||||||||||||||||
Loans charged off | (1,808 | ) | (85 | ) | (1,082 | ) | (288 | ) | (268 | ) | (155 | ) | (276 | ) | (3,962 | ) | ||||||||||||||||
Recoveries | 374 | 87 | 691 | 237 | 236 | 94 | 52 | 1,771 | ||||||||||||||||||||||||
Total net charge-offs | (1,434 | ) | 2 | (391 | ) | (51 | ) | (32 | ) | (61 | ) | (224 | ) | (2,191 | ) | |||||||||||||||||
Ending allowance for loan and lease losses | $ | 16,644 | $ | 1,540 | $ | 23,627 | $ | 4,387 | $ | 3,630 | $ | 1,190 | $ | 2,314 | $ | 53,332 |
Nine months ended September 30, 2016 | ||||||||||||||||||||||||||||||||
Real Estate | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | Commercial and industrial | Construction | Commercial | Residential | Home Equity | Installment | Other | Total | ||||||||||||||||||||||||
Allowance for loan and lease losses: | ||||||||||||||||||||||||||||||||
Balance at beginning of period | $ | 16,995 | $ | 1,810 | $ | 23,656 | $ | 4,014 | $ | 3,943 | $ | 386 | $ | 2,594 | $ | 53,398 | ||||||||||||||||
Provision for loan and lease losses | 3,284 | 1,118 | 3,491 | (806 | ) | (247 | ) | 107 | 432 | 7,379 | ||||||||||||||||||||||
Loans charged off | (1,040 | ) | (95 | ) | (3,993 | ) | (163 | ) | (1,213 | ) | (326 | ) | (864 | ) | (7,694 | ) | ||||||||||||||||
Recoveries | 969 | 234 | 2,120 | 182 | 576 | 217 | 237 | 4,535 | ||||||||||||||||||||||||
Total net charge-offs | (71 | ) | 139 | (1,873 | ) | 19 | (637 | ) | (109 | ) | (627 | ) | (3,159 | ) | ||||||||||||||||||
Ending allowance for loan and lease losses | $ | 20,208 | $ | 3,067 | $ | 25,274 | $ | 3,227 | $ | 3,059 | $ | 384 | $ | 2,399 | $ | 57,618 | ||||||||||||||||
September 30, 2016 | ||||||||||||||||||||||||||||||||
Real Estate | ||||||||||||||||||||||||||||||||
Commercial and industrial | Construction | Commercial | Residential | Home Equity | Installment | Other | Total | |||||||||||||||||||||||||
Ending allowance balance attributable to loans | ||||||||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 777 | $ | 0 | $ | 1,019 | $ | 179 | $ | 2 | $ | 0 | $ | 0 | $ | 1,977 | ||||||||||||||||
Collectively evaluated for impairment | 19,431 | 3,067 | 24,255 | 3,048 | 3,057 | 384 | 2,399 | 55,641 | ||||||||||||||||||||||||
Ending allowance for loan and lease losses | $ | 20,208 | $ | 3,067 | $ | 25,274 | $ | 3,227 | $ | 3,059 | $ | 384 | $ | 2,399 | $ | 57,618 | ||||||||||||||||
Loans | ||||||||||||||||||||||||||||||||
Loans individually evaluated for impairment | $ | 14,799 | $ | 0 | $ | 21,196 | $ | 9,285 | $ | 4,587 | $ | 384 | $ | 214 | $ | 50,465 | ||||||||||||||||
Loans collectively evaluated for impairment | 1,767,983 | 380,349 | 2,446,887 | 498,430 | 459,115 | 47,441 | 138,841 | 5,739,046 | ||||||||||||||||||||||||
Total loans | $ | 1,782,782 | $ | 380,349 | $ | 2,468,083 | $ | 507,715 | $ | 463,702 | $ | 47,825 | $ | 139,055 | $ | 5,789,511 |
Nine months ended September 30, 2015 | ||||||||||||||||||||||||||||||||
Real Estate | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | Commercial and industrial | Construction | Commercial | Residential | Home Equity | Installment | Other | Total | ||||||||||||||||||||||||
Allowance for loan and lease losses: | ||||||||||||||||||||||||||||||||
Balance at beginning of period | $ | 13,870 | $ | 1,045 | $ | 27,086 | $ | 3,753 | $ | 4,260 | $ | 407 | $ | 2,437 | $ | 52,858 | ||||||||||||||||
Provision for loan and lease losses | 4,522 | 431 | (78 | ) | 1,739 | (269 | ) | 916 | 516 | 7,777 | ||||||||||||||||||||||
Loans charged off | (4,631 | ) | (85 | ) | (5,668 | ) | (1,449 | ) | (1,258 | ) | (380 | ) | (807 | ) | (14,278 | ) | ||||||||||||||||
Recoveries | 2,883 | 149 | 2,287 | 344 | 897 | 247 | 168 | 6,975 | ||||||||||||||||||||||||
Total net charge-offs | (1,748 | ) | 64 | (3,381 | ) | (1,105 | ) | (361 | ) | (133 | ) | (639 | ) | (7,303 | ) | |||||||||||||||||
Ending allowance for loan and lease losses | $ | 16,644 | $ | 1,540 | $ | 23,627 | $ | 4,387 | $ | 3,630 | $ | 1,190 | $ | 2,314 | $ | 53,332 | ||||||||||||||||
December 31, 2015 | ||||||||||||||||||||||||||||||||
Real Estate | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | Commercial and industrial | Construction | Commercial | Residential | Home Equity | Installment | Other | Total | ||||||||||||||||||||||||
Ending allowance balance attributable to loans | ||||||||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 357 | $ | 0 | $ | 979 | $ | 235 | $ | 2 | $ | 0 | $ | 0 | $ | 1,573 | ||||||||||||||||
Collectively evaluated for impairment | 16,638 | 1,810 | 22,677 | 3,779 | 3,941 | 386 | 2,594 | 51,825 | ||||||||||||||||||||||||
Ending allowance for loan and lease losses | $ | 16,995 | $ | 1,810 | $ | 23,656 | $ | 4,014 | $ | 3,943 | $ | 386 | $ | 2,594 | $ | 53,398 | ||||||||||||||||
Loans | ||||||||||||||||||||||||||||||||
Loans individually evaluated for impairment | $ | 17,411 | $ | 0 | $ | 24,652 | $ | 8,994 | $ | 5,441 | $ | 253 | $ | 122 | $ | 56,873 | ||||||||||||||||
Loans collectively evaluated for impairment | 1,645,691 | 311,712 | 2,233,645 | 503,317 | 461,188 | 41,253 | 135,081 | 5,331,887 | ||||||||||||||||||||||||
Total loans | $ | 1,663,102 | $ | 311,712 | $ | 2,258,297 | $ | 512,311 | $ | 466,629 | $ | 41,506 | $ | 135,203 | $ | 5,388,760 |
(Dollars in thousands) | September 30, 2016 | December 31, 2015 | |||||
Balance at beginning of year | $ | 204,084 | $ | 137,739 | |||
Goodwill resulting from business combinations | 0 | 66,345 | |||||
Balance at end of period | $ | 204,084 | $ | 204,084 |
September 30, 2016 | December 31, 2015 | |||||||||||||
(Dollars in thousands) | Amount | Average rate | Amount | Average rate | ||||||||||
Subordinated debt | $ | 118,419 | 5.19 | % | $ | 118,312 | 5.20 | % | ||||||
FHLB advances | 355 | 1.41 | % | 453 | 2.37 | % | ||||||||
Capital loan with municipality | 775 | 0.00 | % | 775 | 0.00 | % | ||||||||
Total long-term debt | $ | 119,549 | 5.15 | % | $ | 119,540 | 5.15 | % |
Three months ended September 30, 2016 | |||||||||||||||||||||||||||||||
Total other comprehensive income | Total accumulated other comprehensive income | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Prior to Reclassification | Reclassification from | Pre-tax | Tax-effect | Net of tax | Beginning Balance | Net Activity | Ending Balance | |||||||||||||||||||||||
Unrealized gain (loss) on investment securities | $ | 99 | $ | 398 | $ | (299 | ) | $ | 137 | $ | (162 | ) | $ | 7,302 | $ | (162 | ) | $ | 7,140 | ||||||||||||
Unrealized gain (loss) on derivatives | 202 | 0 | 202 | (74 | ) | 128 | (1,343 | ) | 128 | (1,215 | ) | ||||||||||||||||||||
Retirement obligation | 0 | (317 | ) | 317 | (117 | ) | 200 | (23,647 | ) | 200 | (23,447 | ) | |||||||||||||||||||
Foreign currency translation | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||||||||
Total | $ | 301 | $ | 81 | $ | 220 | $ | (54 | ) | $ | 166 | $ | (17,688 | ) | $ | 166 | $ | (17,522 | ) |
Three months ended September 30, 2015 | |||||||||||||||||||||||||||||||
Total other comprehensive income | Total accumulated other comprehensive income | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Prior to Reclassification | Reclassification from | Pre-tax | Tax-effect | Net of tax | Beginning Balance | Net Activity | Ending Balance | |||||||||||||||||||||||
Unrealized gain (loss) on investment securities | $ | 5,213 | $ | 409 | $ | 4,804 | $ | (1,747 | ) | $ | 3,057 | $ | (1,276 | ) | $ | 3,057 | $ | 1,781 | |||||||||||||
Unrealized gain (loss) on derivatives | 203 | 0 | 203 | (75 | ) | 128 | (1,848 | ) | 128 | (1,720 | ) | ||||||||||||||||||||
Retirement obligation | 0 | (350 | ) | 350 | (130 | ) | 220 | (17,500 | ) | 220 | (17,280 | ) | |||||||||||||||||||
Foreign currency translation | 91 | 0 | 91 | 0 | 91 | (91 | ) | 91 | 0 | ||||||||||||||||||||||
Total | $ | 5,507 | $ | 59 | $ | 5,448 | $ | (1,952 | ) | $ | 3,496 | $ | (20,715 | ) | $ | 3,496 | $ | (17,219 | ) |
Nine months ended September 30, 2016 | |||||||||||||||||||||||||||||||
Total other comprehensive income | Total accumulated other comprehensive income (loss) | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Prior to Reclassification | Reclassification from | Pre-tax | Tax-effect | Net of tax | Beginning Balance | Net Activity | Ending Balance | |||||||||||||||||||||||
Unrealized gain (loss) on investment securities | $ | 18,951 | $ | 234 | $ | 18,717 | $ | (6,644 | ) | $ | 12,073 | $ | (4,933 | ) | $ | 12,073 | $ | 7,140 | |||||||||||||
Unrealized gain (loss) on derivatives | 607 | 0 | 607 | (223 | ) | 384 | (1,599 | ) | 384 | (1,215 | ) | ||||||||||||||||||||
Retirement obligation | 0 | (951 | ) | 951 | (350 | ) | 601 | (24,048 | ) | 601 | (23,447 | ) | |||||||||||||||||||
Total | $ | 19,558 | $ | (717 | ) | $ | 20,275 | $ | (7,217 | ) | $ | 13,058 | $ | (30,580 | ) | $ | 13,058 | $ | (17,522 | ) |
Nine months ended September 30, 2015 | |||||||||||||||||||||||||||||||
Total other comprehensive income | Total accumulated other comprehensive income (loss) | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Prior to Reclassification | Reclassification from | Pre-tax | Tax-effect | Net of tax | Beginning Balance | Net Activity | Ending Balance | |||||||||||||||||||||||
Unrealized gain (loss) on investment securities | $ | 8,219 | $ | 1,503 | $ | 6,716 | $ | (2,429 | ) | $ | 4,287 | $ | (2,506 | ) | $ | 4,287 | $ | 1,781 | |||||||||||||
Unrealized gain (loss) on derivatives | (1,222 | ) | 0 | (1,222 | ) | 451 | (771 | ) | (949 | ) | (771 | ) | (1,720 | ) | |||||||||||||||||
Retirement obligation | 0 | (1,050 | ) | 1,050 | (426 | ) | 624 | (17,904 | ) | 624 | (17,280 | ) | |||||||||||||||||||
Foreign currency translation | 50 | 0 | 50 | 0 | 50 | (50 | ) | 50 | 0 | ||||||||||||||||||||||
Total | $ | 7,047 | $ | 453 | $ | 6,594 | $ | (2,404 | ) | $ | 4,190 | $ | (21,409 | ) | $ | 4,190 | $ | (17,219 | ) |
Amount reclassified from accumulated other comprehensive income (1) | ||||||||||||||||||
Three months ended | Nine months ended | |||||||||||||||||
September 30, | September 30, | |||||||||||||||||
(Dollars in thousands) | 2016 | 2015 | 2016 | 2015 | Affected Line Item in the Consolidated Statements of Income | |||||||||||||
Realized gains and losses on securities available-for-sale | $ | 398 | $ | 409 | $ | 234 | $ | 1,503 | Gains on sales of investments securities | |||||||||
Defined benefit pension plan | ||||||||||||||||||
Amortization of prior service cost (2) | 103 | 100 | 310 | 300 | Salaries and employee benefits | |||||||||||||
Recognized net actuarial loss (2) | (420 | ) | (450 | ) | (1,261 | ) | (1,350 | ) | Salaries and employee benefits | |||||||||
Defined benefit pension plan total | (317 | ) | (350 | ) | (951 | ) | (1,050 | ) | ||||||||||
Total reclassifications for the period, before tax | $ | 81 | $ | 59 | $ | (717 | ) | $ | 453 |
September 30, 2016 | December 31, 2015 | |||||||||||||||||||||||||
Estimated fair value | Estimated fair value | |||||||||||||||||||||||||
(Dollars in thousands) | Balance sheet classification | Notional amount | Gain | Loss | Notional amount | Gain | Loss | |||||||||||||||||||
Client derivatives - instruments associated with loans | ||||||||||||||||||||||||||
Pay fixed interest rate swaps with counterparty | Accrued interest and other liabilities | $ | 812 | $ | 0 | $ | (42 | ) | $ | 5,216 | $ | 0 | $ | (120 | ) | |||||||||||
Matched interest rate swaps with borrower | Accrued interest and other assets | 696,557 | 28,522 | 0 | 546,458 | 13,981 | (44 | ) | ||||||||||||||||||
Matched interest rate swaps with counterparty | Accrued interest and other liabilities | 696,557 | 0 | (28,615 | ) | 546,458 | 44 | (14,015 | ) | |||||||||||||||||
Total | $ | 1,393,926 | $ | 28,522 | $ | (28,657 | ) | $ | 1,098,132 | $ | 14,025 | $ | (14,179 | ) |
September 30, 2016 | December 31, 2015 | ||||||||||||||||||||||
(Dollars in thousands) | Gross amounts of recognized liabilities | Gross amounts offset in the Consolidated Balance Sheets | Net amounts of assets presented in the Consolidated Balance Sheets | Gross amounts of recognized liabilities | Gross amounts offset in the Consolidated Balance Sheets | Net amounts of assets presented in the Consolidated Balance Sheets | |||||||||||||||||
Client derivatives | |||||||||||||||||||||||
Pay fixed interest rate swaps with counterparty | $ | 42 | $ | 0 | $ | 42 | $ | 120 | $ | 0 | $ | 120 | |||||||||||
Matched interest rate swaps with counterparty | 28,615 | (29,990 | ) | (1,375 | ) | 14,015 | (16,710 | ) | (2,695 | ) | |||||||||||||
Total | $ | 28,657 | $ | (29,990 | ) | $ | (1,333 | ) | $ | 14,135 | $ | (16,710 | ) | $ | (2,575 | ) |
Weighted-average rate | ||||||||||||||||
(Dollars in thousands) | Notional amount | Average maturity (years) | Fair value | Receive | Pay | |||||||||||
Client derivatives | ||||||||||||||||
Pay fixed interest rate swaps with counterparty | $ | 812 | 1.9 | $ | (42 | ) | 2.99 | % | 6.84 | % | ||||||
Receive fixed, matched interest rate swaps with borrower | 696,557 | 5.7 | 28,522 | 4.14 | % | 2.68 | % | |||||||||
Pay fixed, matched interest rate swaps with counterparty | 696,557 | 5.7 | (28,615 | ) | 2.68 | % | 4.14 | % | ||||||||
Total client derivatives | $ | 1,393,926 | 5.7 | $ | (135 | ) | 3.41 | % | 3.42 | % |
Three months ended | Nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
(Dollars in thousands) | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Service cost | $ | 1,308 | $ | 1,175 | $ | 3,925 | $ | 3,525 | ||||||||
Interest cost | 581 | 550 | 1,743 | 1,650 | ||||||||||||
Expected return on assets | (2,431 | ) | (2,375 | ) | (7,294 | ) | (7,125 | ) | ||||||||
Amortization of prior service cost | (103 | ) | (100 | ) | (310 | ) | (300 | ) | ||||||||
Net actuarial loss | 420 | 450 | 1,261 | 1,350 | ||||||||||||
Net periodic benefit (income) cost | $ | (225 | ) | $ | (300 | ) | $ | (675 | ) | $ | (900 | ) |
Three months ended | Nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
(Dollars in thousands, except per share data) | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Numerator | ||||||||||||||||
Net income available to common shareholders | $ | 22,850 | $ | 18,673 | $ | 65,232 | $ | 55,243 | ||||||||
Denominator | ||||||||||||||||
Basic earnings per common share - weighted average shares | 61,280,283 | 61,135,749 | 61,170,845 | 61,088,794 | ||||||||||||
Effect of dilutive securities | ||||||||||||||||
Employee stock awards | 740,977 | 715,585 | 736,659 | 643,536 | ||||||||||||
Warrants | 64,807 | 136,461 | 55,457 | 126,394 | ||||||||||||
Diluted earnings per common share - adjusted weighted average shares | 62,086,067 | 61,987,795 | 61,962,961 | 61,858,724 | ||||||||||||
Earnings per share available to common shareholders | ||||||||||||||||
Basic | $ | 0.37 | $ | 0.31 | $ | 1.07 | $ | 0.90 | ||||||||
Diluted | $ | 0.37 | $ | 0.30 | $ | 1.05 | $ | 0.89 |
Carrying | Estimated fair value | ||||||||||||||
(Dollars in thousands) | value | Total | Level 1 | Level 2 | Level 3 | ||||||||||
September 30, 2016 | |||||||||||||||
Financial assets | |||||||||||||||
Cash and short-term investments | $ | 134,747 | $ | 134,747 | $ | 134,747 | $ | 0 | $ | 0 | |||||
Investment securities held-to-maturity | 628,497 | 645,751 | 0 | 645,751 | 0 | ||||||||||
Other investments | 51,170 | N/A | N/A | N/A | N/A | ||||||||||
Loans held for sale | 17,414 | 17,414 | 0 | 17,414 | 0 | ||||||||||
Loans and leases, net of ALLL | 5,731,893 | 5,787,327 | 0 | 0 | 5,787,327 | ||||||||||
FDIC indemnification asset | 13,287 | 7,455 | 0 | 0 | 7,455 | ||||||||||
Accrued interest receivable | 18,071 | 18,071 | 0 | 5,423 | 12,648 | ||||||||||
Financial liabilities | |||||||||||||||
Deposits | |||||||||||||||
Noninterest-bearing | $ | 1,492,011 | $ | 1,492,011 | $ | 0 | $ | 1,492,011 | $ | 0 | |||||
Interest-bearing demand | 1,494,529 | 1,494,529 | 0 | 1,494,529 | 0 | ||||||||||
Savings | 2,005,407 | 2,005,407 | 0 | 2,005,407 | 0 | ||||||||||
Time | 1,346,736 | 1,349,546 | 0 | 1,349,546 | 0 | ||||||||||
Total deposits | 6,338,683 | 6,341,493 | 0 | 6,341,493 | 0 | ||||||||||
Short-term borrowings | 926,236 | 926,236 | 926,236 | 0 | 0 | ||||||||||
Long-term debt | 119,549 | 124,890 | 0 | 124,890 | 0 | ||||||||||
Accrued interest payable | 3,523 | 3,523 | 640 | 2,883 | 0 |
Carrying | Estimated fair value | ||||||||||||||
(Dollars in thousands) | value | Total | Level 1 | Level 2 | Level 3 | ||||||||||
December 31, 2015 | |||||||||||||||
Financial assets | |||||||||||||||
Cash and short-term investments | $ | 148,575 | $ | 148,575 | $ | 148,575 | $ | 0 | $ | 0 | |||||
Investment securities held-to-maturity | 726,259 | 731,951 | 0 | 731,951 | 0 | ||||||||||
Other investments | 53,725 | N/A | N/A | N/A | N/A | ||||||||||
Loans held for sale | 20,957 | 20,957 | 0 | 20,957 | 0 | ||||||||||
Loans and leases, net of ALLL | 5,335,362 | 5,381,065 | 0 | 0 | 5,381,065 | ||||||||||
FDIC indemnification asset | 17,630 | 9,756 | 0 | 0 | 9,756 | ||||||||||
Accrued interest receivable | 16,995 | 16,995 | 0 | 5,791 | 11,204 | ||||||||||
Financial liabilities | |||||||||||||||
Deposits | |||||||||||||||
Noninterest-bearing | $ | 1,413,404 | $ | 1,413,404 | $ | 0 | $ | 1,413,404 | $ | 0 | |||||
Interest-bearing demand | 1,414,291 | 1,414,291 | 0 | 1,414,291 | 0 | ||||||||||
Savings | 1,945,805 | 1,945,805 | 0 | 1,945,805 | 0 | ||||||||||
Time | 1,406,124 | 1,406,489 | 0 | 1,406,489 | 0 | ||||||||||
Total deposits | 6,179,624 | 6,179,989 | 0 | 6,179,989 | 0 | ||||||||||
Short-term borrowings | 938,425 | 938,425 | 938,425 | 0 | 0 | ||||||||||
Long-term debt | 119,540 | 118,691 | 0 | 118,691 | 0 | ||||||||||
Accrued interest payable | 5,003 | 5,003 | 113 | 4,890 | 0 |
Fair value measurements using | ||||||||||||||||
(Dollars in thousands) | Level 1 | Level 2 | Level 3 | Assets/liabilities at fair value | ||||||||||||
September 30, 2016 | ||||||||||||||||
Assets | ||||||||||||||||
Derivatives | $ | 0 | $ | 28,835 | $ | 0 | $ | 28,835 | ||||||||
Investment securities available-for-sale | 8,905 | 1,111,589 | 0 | 1,120,494 | ||||||||||||
Total | $ | 8,905 | $ | 1,140,424 | $ | 0 | $ | 1,149,329 | ||||||||
Liabilities | ||||||||||||||||
Derivatives | $ | 0 | $ | 28,756 | $ | 0 | $ | 28,756 |
Fair value measurements using | ||||||||||||||||
(Dollars in thousands) | Level 1 | Level 2 | Level 3 | Assets/liabilities at fair value | ||||||||||||
December 31, 2015 | ||||||||||||||||
Assets | ||||||||||||||||
Derivatives | $ | 0 | $ | 14,111 | $ | 0 | $ | 14,111 | ||||||||
Investment securities available-for-sale | 8,583 | 1,182,059 | 0 | 1,190,642 | ||||||||||||
Total | $ | 8,583 | $ | 1,196,170 | $ | 0 | $ | 1,204,753 | ||||||||
Liabilities | ||||||||||||||||
Derivatives | $ | 0 | $ | 14,243 | $ | 0 | $ | 14,243 |
Fair value measurements using | ||||||||||||
(Dollars in thousands) | Level 1 | Level 2 | Level 3 | |||||||||
September 30, 2016 | ||||||||||||
Assets | ||||||||||||
Loans held for sale | $ | 0 | $ | 17,414 | $ | 0 | ||||||
Impaired loans | 0 | 0 | 7,820 | |||||||||
OREO | 0 | 0 | 5,149 |
Fair value measurements using | ||||||||||||
(Dollars in thousands) | Level 1 | Level 2 | Level 3 | |||||||||
December 31, 2015 | ||||||||||||
Assets | ||||||||||||
Loans held for sale | $ | 0 | $ | 20,957 | $ | 0 | ||||||
Impaired loans | 0 | 0 | 8,008 | |||||||||
OREO | 0 | 0 | 7,598 |
(Dollars in thousands) | Oak Street | ||
Purchase consideration | |||
Cash consideration | $ | 110,000 | |
Payoff of long-term borrowings | 197,839 | ||
Total purchase consideration | 307,839 | ||
Assets acquired | |||
Cash | 2,248 | ||
Loans | 237,377 | ||
Intangible assets | 813 | ||
Other assets | 2,633 | ||
Total assets | 243,071 | ||
Liabilities assumed | |||
Other liabilities | 1,577 | ||
Total liabilities | 1,577 | ||
Net identifiable assets | 241,494 | ||
Goodwill | $ | 66,345 |
Three months ended | Nine months ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
(Dollars in thousands) | 2016 | 2015 | 2016 | 2015 | |||||||||||
Net interest income | $ | 68,818 | $ | 63,159 | $ | 202,505 | $ | 180,419 | |||||||
Tax equivalent adjustment | 1,028 | 1,000 | 3,138 | 2,971 | |||||||||||
Net interest income - tax equivalent | $ | 69,846 | $ | 64,159 | $ | 205,643 | $ | 183,390 | |||||||
Average earning assets | $ | 7,591,160 | $ | 6,938,107 | $ | 7,488,670 | $ | 6,711,900 | |||||||
Net interest margin (1) | 3.61 | % | 3.61 | % | 3.61 | % | 3.59 | % | |||||||
Net interest margin (fully tax equivalent) (1) | 3.66 | % | 3.67 | % | 3.67 | % | 3.65 | % |
Quarterly Averages | Year-to-Date Averages | |||||||||||||||||||||||||||
September 30, 2016 | September 30, 2015 | September 30, 2016 | September 30, 2015 | |||||||||||||||||||||||||
(Dollars in thousands) | Balance | Yield | Balance | Yield | Balance | Yield | Balance | Yield | ||||||||||||||||||||
Earning assets | ||||||||||||||||||||||||||||
Investments | ||||||||||||||||||||||||||||
Investment securities | $ | 1,811,240 | 2.50 | % | $ | 1,848,083 | 2.39 | % | $ | 1,872,958 | 2.56 | % | $ | 1,798,143 | 2.40 | % | ||||||||||||
Interest-bearing deposits with other banks | 22,116 | 0.54 | % | 37,468 | 0.25 | % | 22,696 | 0.52 | % | 26,287 | 0.26 | % | ||||||||||||||||
Gross loans (1) | 5,757,804 | 4.54 | % | 5,052,556 | 4.52 | % | 5,593,016 | 4.58 | % | 4,887,470 | 4.49 | % | ||||||||||||||||
Total earning assets | 7,591,160 | 4.04 | % | 6,938,107 | 3.93 | % | 7,488,670 | 4.06 | % | 6,711,900 | 3.91 | % | ||||||||||||||||
Nonearning assets | ||||||||||||||||||||||||||||
Allowance for loan and lease losses | (58,284 | ) | (54,398 | ) | (56,231 | ) | (54,239 | ) | ||||||||||||||||||||
Cash and due from banks | 116,441 | 114,279 | 118,542 | 113,720 | ||||||||||||||||||||||||
Accrued interest and other assets | 672,839 | 613,401 | 664,389 | 582,317 | ||||||||||||||||||||||||
Total assets | $ | 8,322,156 | $ | 7,611,389 | $ | 8,215,370 | $ | 7,353,698 | ||||||||||||||||||||
Interest-bearing liabilities | ||||||||||||||||||||||||||||
Deposits | ||||||||||||||||||||||||||||
Interest-bearing demand | $ | 1,447,226 | 0.15 | % | $ | 1,230,621 | 0.09 | % | $ | 1,440,638 | 0.14 | % | $ | 1,209,291 | 0.08 | % | ||||||||||||
Savings | 2,015,602 | 0.27 | % | 2,015,373 | 0.19 | % | 1,998,727 | 0.26 | % | 1,960,443 | 0.22 | % | ||||||||||||||||
Time | 1,284,059 | 1.14 | % | 1,369,892 | 1.05 | % | 1,348,345 | 1.10 | % | 1,305,751 | 1.07 | % | ||||||||||||||||
Total interest-bearing deposits | 4,746,887 | 0.47 | % | 4,615,886 | 0.42 | % | 4,787,710 | 0.46 | % | 4,475,485 | 0.43 | % | ||||||||||||||||
Borrowed funds | ||||||||||||||||||||||||||||
Short-term borrowings | 1,033,439 | 0.53 | % | 675,123 | 0.22 | % | 942,334 | 0.51 | % | 619,540 | 0.20 | % | ||||||||||||||||
Long-term debt | 119,603 | 5.11 | % | 71,583 | 1.56 | % | 119,577 | 5.17 | % | 55,645 | 2.10 | % | ||||||||||||||||
Total borrowed funds | 1,153,042 | 1.00 | % | 746,706 | 0.35 | % | 1,061,911 | 1.03 | % | 675,185 | 0.36 | % | ||||||||||||||||
Total interest-bearing liabilities | 5,899,929 | 0.57 | % | 5,362,592 | 0.41 | % | 5,849,621 | 0.57 | % | 5,150,670 | 0.42 | % | ||||||||||||||||
Noninterest-bearing liabilities | ||||||||||||||||||||||||||||
Noninterest-bearing demand deposits | 1,453,842 | 1,344,049 | 1,427,323 | 1,318,746 | ||||||||||||||||||||||||
Other liabilities | 112,089 | 92,352 | 99,929 | 83,693 | ||||||||||||||||||||||||
Shareholders' equity | 856,296 | 812,396 | 838,497 | 800,589 | ||||||||||||||||||||||||
Total liabilities and shareholders' equity | $ | 8,322,156 | $ | 7,611,389 | $ | 8,215,370 | $ | 7,353,698 | ||||||||||||||||||||
Net interest income | $ | 68,818 | $ | 63,159 | $ | 202,505 | $ | 180,419 | ||||||||||||||||||||
Net interest spread | 3.47 | % | 3.52 | % | 3.49 | % | 3.49 | % | ||||||||||||||||||||
Contribution of noninterest-bearing sources of funds | 0.14 | % | 0.09 | % | 0.12 | % | 0.10 | % | ||||||||||||||||||||
Net interest margin (2) | 3.61 | % | 3.61 | % | 3.61 | % | 3.59 | % |
Changes for the three months ended September 30, 2016 | Changes for the nine months ended September 30, 2016 | |||||||||||||||||||||||
Comparable quarter income variance | Comparable quarter income variance | |||||||||||||||||||||||
(Dollars in thousands) | Rate | Volume | Total | Rate | Volume | Total | ||||||||||||||||||
Earning assets | ||||||||||||||||||||||||
Investment securities | $ | 492 | $ | (232 | ) | $ | 260 | $ | 2,082 | $ | 1,430 | $ | 3,512 | |||||||||||
Interest-bearing deposits with other banks | 27 | (21 | ) | 6 | 52 | (14 | ) | 38 | ||||||||||||||||
Gross loans (1) | 314 | 8,070 | 8,384 | 3,080 | 24,146 | 27,226 | ||||||||||||||||||
Total earning assets | 833 | 7,817 | 8,650 | 5,214 | 25,562 | 30,776 | ||||||||||||||||||
Interest-bearing liabilities | ||||||||||||||||||||||||
Total interest-bearing deposits | 584 | 155 | 739 | 1,203 | 1,082 | 2,285 | ||||||||||||||||||
Borrowed funds | ||||||||||||||||||||||||
Short-term borrowings | 520 | 474 | 994 | 1,431 | 1,230 | 2,661 | ||||||||||||||||||
Long-term debt | 640 | 618 | 1,258 | 1,274 | 2,470 | 3,744 | ||||||||||||||||||
Total borrowed funds | 1,160 | 1,092 | 2,252 | 2,705 | 3,700 | 6,405 | ||||||||||||||||||
Total interest-bearing liabilities | 1,744 | 1,247 | 2,991 | 3,908 | 4,782 | 8,690 | ||||||||||||||||||
Net interest income | $ | (911 | ) | $ | 6,570 | $ | 5,659 | $ | 1,306 | $ | 20,780 | $ | 22,086 |
Quarter ended | ||||||||||||||||||||
2016 | 2015 | |||||||||||||||||||
(Dollars in thousands) | Sep. 30, | June 30, | Mar. 31, | Dec. 31, | Sep. 30, | |||||||||||||||
Nonperforming loans, nonperforming assets, and underperforming assets | ||||||||||||||||||||
Nonaccrual loans (1) | ||||||||||||||||||||
Commercial and industrial | $ | 3,201 | $ | 2,980 | $ | 3,917 | $ | 8,405 | $ | 7,438 | ||||||||||
Lease financing | 214 | 1,167 | 121 | 122 | 0 | |||||||||||||||
Real estate - construction | 0 | 0 | 0 | 0 | 79 | |||||||||||||||
Real estate - commercial | 5,985 | 8,750 | 8,577 | 9,418 | 17,732 | |||||||||||||||
Real estate - residential | 4,759 | 4,824 | 4,243 | 5,027 | 4,940 | |||||||||||||||
Home equity | 3,815 | 4,123 | 5,036 | 4,898 | 5,203 | |||||||||||||||
Installment | 327 | 433 | 113 | 127 | 321 | |||||||||||||||
Nonaccrual loans | 18,301 | 22,277 | 22,007 | 27,997 | 35,713 | |||||||||||||||
Accruing troubled debt restructurings | 32,164 | 28,022 | 30,127 | 28,876 | 20,226 | |||||||||||||||
Total nonperforming loans | 50,465 | 50,299 | 52,134 | 56,873 | 55,939 | |||||||||||||||
Other real estate owned | 7,577 | 9,302 | 11,939 | 13,254 | 15,187 | |||||||||||||||
Total nonperforming assets | 58,042 | 59,601 | 64,073 | 70,127 | 71,126 | |||||||||||||||
Accruing loans past due 90 days or more | 130 | 981 | 59 | 108 | 58 | |||||||||||||||
Total underperforming assets | $ | 58,172 | $ | 60,582 | $ | 64,132 | $ | 70,235 | $ | 71,184 | ||||||||||
Total classified assets | $ | 142,169 | $ | 143,331 | $ | 133,940 | $ | 132,431 | $ | 130,132 | ||||||||||
Credit quality ratios | ||||||||||||||||||||
Allowance for loan and lease losses to | ||||||||||||||||||||
Nonaccrual loans | 314.84 | % | 254.56 | % | 244.16 | % | 190.73 | % | 149.33 | % | ||||||||||
Nonperforming loans | 114.17 | % | 112.74 | % | 103.07 | % | 93.89 | % | 95.34 | % | ||||||||||
Total ending loans | 1.00 | % | 0.99 | % | 0.98 | % | 0.99 | % | 1.02 | % | ||||||||||
Nonperforming loans to total loans | 0.87 | % | 0.88 | % | 0.95 | % | 1.06 | % | 1.07 | % | ||||||||||
Nonperforming assets to | ||||||||||||||||||||
Ending loans, plus OREO | 1.00 | % | 1.04 | % | 1.16 | % | 1.30 | % | 1.36 | % | ||||||||||
Total assets | 0.69 | % | 0.72 | % | 0.78 | % | 0.86 | % | 0.90 | % | ||||||||||
Nonperforming assets, excluding accruing TDRs to | ||||||||||||||||||||
Ending loans, plus OREO | 0.45 | % | 0.55 | % | 0.62 | % | 0.76 | % | 0.97 | % | ||||||||||
Total assets | 0.31 | % | 0.38 | % | 0.41 | % | 0.51 | % | 0.65 | % | ||||||||||
(1) Nonaccrual loans include nonaccrual TDRs of $5.6 million, $8.0 million, $7.5 million, $9.3 million and $13.6 million, as of September 30, 2016, June 30, 2016, March 31, 2016, December 31, 2015 and September 30, 2015, respectively. |
Actual | Minimum capital required - Basel III current period | Required to be considered well capitalized - current period | Minimum capital required - Basel III fully phased-in | |||||||||||||||||||||||||
(Dollars in thousands) | Capital amount | Ratio | Capital amount | Ratio | Capital amount | Ratio | Capital amount | Ratio | ||||||||||||||||||||
September 30, 2016 | ||||||||||||||||||||||||||||
Common equity tier 1 capital to risk-weighted assets | ||||||||||||||||||||||||||||
Consolidated | $ | 688,363 | 10.20 | % | $ | 345,976 | 5.125 | % | N/A | N/A | $ | 472,553 | 7.00 | % | ||||||||||||||
First Financial Bank | 733,710 | 10.89 | % | 345,177 | 5.125 | % | $ | 437,786 | 6.50 | % | 471,461 | 7.00 | % | |||||||||||||||
Tier 1 capital to risk-weighted assets | ||||||||||||||||||||||||||||
Consolidated | 688,467 | 10.20 | % | 447,237 | 6.625 | % | N/A | N/A | 573,814 | 8.50 | % | |||||||||||||||||
First Financial Bank | 733,814 | 10.90 | % | 446,205 | 6.625 | % | 538,813 | 8.00 | % | 572,489 | 8.50 | % | ||||||||||||||||
Total capital to risk-weighted assets | ||||||||||||||||||||||||||||
Consolidated | 865,248 | 12.82 | % | 582,252 | 8.625 | % | N/A | N/A | 708,829 | 10.50 | % | |||||||||||||||||
First Financial Bank | 799,536 | 11.87 | % | 580,908 | 8.625 | % | 673,516 | 10.00 | % | 707,192 | 10.50 | % | ||||||||||||||||
Leverage ratio | ||||||||||||||||||||||||||||
Consolidated | 688,467 | 8.45 | % | 325,872 | 4.00 | % | N/A | N/A | 325,872 | 4.00 | % | |||||||||||||||||
First Financial Bank | 733,814 | 9.01 | % | 325,611 | 4.00 | % | 407,014 | 5.00 | % | 325,611 | 4.00 | % |
Actual | Minimum capital required - Basel III | Required to be considered well capitalized | Minimum capital required - Basel III fully phased-in | |||||||||||||||||||||||||
(Dollars in thousands) | Capital amount | Ratio | Capital amount | Ratio | Capital amount | Ratio | Capital amount | Ratio | ||||||||||||||||||||
December 31, 2015 | ||||||||||||||||||||||||||||
Common equity tier 1 capital to risk-weighted assets | ||||||||||||||||||||||||||||
Consolidated | $ | 648,748 | 10.28 | % | $ | 283,866 | 4.50 | % | N/A | N/A | $ | 441,570 | 7.00 | % | ||||||||||||||
First Financial Bank | 647,844 | 10.30 | % | 283,080 | 4.50 | % | $ | 408,894 | 6.50 | % | 440,347 | 7.00 | % | |||||||||||||||
Tier 1 capital to risk-weighted assets | ||||||||||||||||||||||||||||
Consolidated | 648,852 | 10.29 | % | 378,488 | 6.00 | % | N/A | N/A | 536,192 | 8.50 | % | |||||||||||||||||
First Financial Bank | 647,948 | 10.30 | % | 377,440 | 6.00 | % | 503,254 | 8.00 | % | 534,707 | 8.50 | % | ||||||||||||||||
Total capital to risk-weighted assets | ||||||||||||||||||||||||||||
Consolidated | 822,431 | 13.04 | % | 504,651 | 8.00 | % | N/A | N/A | 662,355 | 10.50 | % | |||||||||||||||||
First Financial Bank | 709,306 | 11.28 | % | 503,254 | 8.00 | % | 629,067 | 10.00 | % | 660,521 | 10.50 | % | ||||||||||||||||
Leverage ratio | ||||||||||||||||||||||||||||
Consolidated | 648,852 | 8.33 | % | 311,481 | 4.00 | % | N/A | N/A | 311,481 | 4.00 | % | |||||||||||||||||
First Financial Bank | 647,948 | 8.33 | % | 311,205 | 4.00 | % | 389,006 | 5.00 | % | 311,205 | 4.00 | % |
Three months ended | Nine months ended | ||||||||||||||||||||||||||
2016 | 2015 | September 30, | |||||||||||||||||||||||||
(Dollars in thousands) | Sep. 30, | June 30, | Mar. 31, | Dec. 31, | Sep. 30, | 2016 | 2015 | ||||||||||||||||||||
Allowance for loan and lease loss activity | |||||||||||||||||||||||||||
Balance at beginning of period | $ | 56,708 | $ | 53,732 | $ | 53,398 | $ | 53,332 | $ | 52,876 | $ | 53,398 | $ | 52,858 | |||||||||||||
Provision for loan losses | 1,687 | 4,037 | 1,655 | 1,864 | 2,647 | 7,379 | 7,777 | ||||||||||||||||||||
Gross charge-offs | |||||||||||||||||||||||||||
Commercial and industrial | 296 | 265 | 479 | 777 | 1,808 | 1,040 | 4,631 | ||||||||||||||||||||
Real estate-construction | 64 | 28 | 3 | 0 | 85 | 95 | 85 | ||||||||||||||||||||
Real estate-commercial | 1,135 | 1,596 | 1,262 | 4,415 | 1,082 | 3,993 | 5,668 | ||||||||||||||||||||
Real estate-residential | 90 | 28 | 45 | 82 | 288 | 163 | 1,449 | ||||||||||||||||||||
Home equity | 475 | 398 | 340 | 633 | 268 | 1,213 | 1,258 | ||||||||||||||||||||
Installment | 223 | 30 | 73 | 129 | 155 | 326 | 380 | ||||||||||||||||||||
All other | 267 | 357 | 240 | 242 | 276 | 864 | 807 | ||||||||||||||||||||
Total gross charge-offs | 2,550 | 2,702 | 2,442 | 6,278 | 3,962 | 7,694 | 14,278 | ||||||||||||||||||||
Recoveries | |||||||||||||||||||||||||||
Commercial and industrial | 327 | 420 | 222 | 841 | 374 | 969 | 2,883 | ||||||||||||||||||||
Real estate-construction | 6 | 202 | 26 | 104 | 87 | 234 | 149 | ||||||||||||||||||||
Real estate-commercial | 997 | 681 | 442 | 2,927 | 691 | 2,120 | 2,287 | ||||||||||||||||||||
Real estate-residential | 38 | 81 | 63 | 214 | 237 | 182 | 344 | ||||||||||||||||||||
Home equity | 257 | 131 | 188 | 104 | 236 | 576 | 897 | ||||||||||||||||||||
Installment | 56 | 62 | 99 | 216 | 94 | 217 | 247 | ||||||||||||||||||||
All other | 92 | 64 | 81 | 74 | 52 | 237 | 168 | ||||||||||||||||||||
Total recoveries | 1,773 | 1,641 | 1,121 | 4,480 | 1,771 | 4,535 | 6,975 | ||||||||||||||||||||
Total net charge-offs | 777 | 1,061 | 1,321 | 1,798 | 2,191 | 3,159 | 7,303 | ||||||||||||||||||||
Ending allowance for loan and lease losses | $ | 57,618 | $ | 56,708 | $ | 53,732 | $ | 53,398 | $ | 53,332 | $ | 57,618 | $ | 53,332 | |||||||||||||
Net charge-offs to average loans and leases (annualized) | |||||||||||||||||||||||||||
Commercial and industrial | (0.01 | )% | (0.04 | )% | 0.06 | % | (0.02 | )% | 0.39 | % | 0.01 | % | 0.17 | % | |||||||||||||
Real estate-construction | 0.06 | % | (0.20 | )% | (0.03 | )% | (0.14 | )% | 0.00 | % | (0.05 | )% | (0.04 | )% | |||||||||||||
Real estate-commercial | 0.02 | % | 0.16 | % | 0.15 | % | 0.27 | % | 0.07 | % | 0.11 | % | 0.21 | % | |||||||||||||
Real estate-residential | 0.04 | % | (0.04 | )% | (0.01 | )% | (0.10 | )% | 0.04 | % | 0.00 | % | 0.30 | % | |||||||||||||
Home equity | 0.19 | % | 0.23 | % | 0.13 | % | 0.45 | % | 0.03 | % | 0.18 | % | 0.10 | % | |||||||||||||
Installment | 1.40 | % | (0.29 | )% | (0.25 | )% | (0.84 | )% | 0.58 | % | 0.33 | % | 0.41 | % | |||||||||||||
All other | 0.50 | % | 0.83 | % | 0.47 | % | 0.51 | % | 0.72 | % | 0.60 | % | 0.71 | % | |||||||||||||
Total net charge-offs | 0.05 | % | 0.08 | % | 0.10 | % | 0.14 | % | 0.17 | % | 0.08 | % | 0.20 | % |
% Change from base case for immediate parallel changes in rates | ||||||||
-100 BP (1) | +100 BP | +200 BP | ||||||
NII-Year 1 | (4.11 | )% | 0.89 | % | 3.27 | % | ||
NII-Year 2 | (5.89 | )% | 2.10 | % | 5.48 | % | ||
EVE | (8.87 | )% | 2.11 | % | 5.68 | % |
Beta sensitivity (% change from base) | |||||||||||
+100 BP | +200 BP | ||||||||||
Beta 25% lower | Beta 25% higher | Beta 25% lower | Beta 25% higher | ||||||||
NII-Year 1 | 2.20 | % | (0.43 | )% | 5.23 | % | 1.30 | % | |||
NII-Year 2 | 3.42 | % | 0.78 | % | 7.45 | % | 3.51 | % |
Item 1. | Legal Proceedings. |
Item 1A. | Risk Factors. |
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
(c) | The following table shows the total number of shares repurchased in the third quarter of 2016. |
(a) | (b) | (c) | (d) | ||||||||||
Period | Total Number Of Shares Purchased (1) | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans (2) | Maximum Number of Shares that may yet be purchased Under the Plans | |||||||||
July 1 to July 31, 2016 | |||||||||||||
Share repurchase program | 0 | $ | 0.00 | 0 | 3,509,133 | ||||||||
Stock Plans | 0 | 0.00 | N/A | N/A | |||||||||
August 1 to August 31, 2016 | |||||||||||||
Share repurchase program | 0 | $ | 0.00 | 0 | 3,509,133 | ||||||||
Stock Plans | 30,100 | 21.11 | N/A | N/A | |||||||||
September 1 to September 30, 2016 | |||||||||||||
Share repurchase program | 0 | $ | 0.00 | 0 | 3,509,133 | ||||||||
Stock Plans | 0 | 0.00 | N/A | N/A | |||||||||
Total | |||||||||||||
Share repurchase program | 0 | $ | 0.00 | 0 | |||||||||
Stock Plans | 30,100 | 21.11 | N/A |
(1) | Except with respect to the share repurchase program, the number of shares purchased in column (a) and the average price paid per share in column (b) include the purchase of shares other than through publicly announced plans. The shares purchased other than through publicly announced plans were purchased pursuant to First Financial’s 1999 Stock Option Plan for Non-Employee Directors, 1999 Stock Incentive Plan for Officers and Employees, 2009 Employee Stock Plan, Amended and Restated 2009 Non-Employee Director Stock Plan and 2012 Stock Plan (collectively referred to hereafter as the Stock Plans). The table shows the number of shares purchased pursuant to those plans and the average price paid per share. Under the Stock Plans, shares were purchased from plan participants at the then current market value in satisfaction of stock option exercise prices. |
(2) | First Financial has one previously announced stock repurchase plan under which it is authorized to purchase shares of its common stock. The plan has no expiration date. The table that follows provides additional information regarding this plan. |
Announcement Date | Total Shares Approved for Repurchase | Total Shares Repurchased Under the Plan | Expiration Date | |||||
10/25/2012 | 5,000,000 | 1,490,867 | None |
(a) | Exhibits: | |
Exhibit Number | ||
31.1 | Certification by Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 filed herewith. | |
31.2 | Certification by Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 filed herewith. | |
32.1 | Certification of Periodic Financial Report by Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 furnished herewith. | |
32.2 | Certification of Periodic Financial Report by Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 furnished herewith. | |
101.1 | Financial statements from the Quarterly Report on Form 10-Q of the Company for the quarter ended September 30, 2016, formatted in XBRL (eXtensible Business Reporting Language) pursuant to Rule 405 of Regulation S-T: (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Income, (iii) Consolidated Statements of Comprehensive Income, (iv) Consolidated Statements of Changes in Shareholders' Equity, (v) Consolidated Statements of Cash Flows and (vi) Notes to Consolidated Financial Statements, as blocks of text and in detail.(1) |
FIRST FINANCIAL BANCORP. | ||||||
(Registrant) | ||||||
/s/ Claude E. Davis | /s/ John M. Gavigan | |||||
Claude E. Davis | John M. Gavigan | |||||
Chief Executive Officer | Senior Vice President and Chief Financial Officer | |||||
(Principal Accounting Officer) | ||||||
Date | 11/8/2016 | Date | 11/8/2016 |
1. | I have reviewed this quarterly report on Form 10-Q of First Financial Bancorp.; |
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 officers 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 quarter in 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 officers 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 registrant’s board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: | 11/8/2016 | /s/ Claude E. Davis | |
Claude E. Davis Chief Executive Officer |
1. | I have reviewed this quarterly report on Form 10-Q of First Financial Bancorp.; |
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 officers 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 quarter in 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 officers 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 registrant’s board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: | 11/8/2016 | /s/ John M. Gavigan | |
John M. Gavigan Senior Vice President and Chief Financial Officer |
(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/ Claude E. Davis |
Claude E. Davis Chief Executive Officer |
November 8, 2016 |
(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/ John M. Gavigan |
John M. Gavigan Senior Vice President and Chief Financial Officer |
November 8, 2016 |
Document and Entity Information Document - shares |
9 Months Ended | |
---|---|---|
Sep. 30, 2016 |
Nov. 07, 2016 |
|
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2016 | |
Document Fiscal Year Focus | 2016 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | FFBC | |
Entity Registrant Name | FIRST FINANCIAL BANCORP /OH/ | |
Entity Central Index Key | 0000708955 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 61,955,821 |
CONSOLIDATED BALANCE SHEETS CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands |
Sep. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Available-for-sale Securities, Amortized Cost Basis | $ 1,110,784 | $ 1,203,065 |
Held-to-maturity Securities, Fair Value | $ 645,751 | $ 731,951 |
Common Stock, No Par Value | $ 0 | $ 0 |
Common Stock, Shares Authorized | 160,000,000 | 160,000,000 |
Common Stock, Shares, Issued | 68,730,731 | 68,730,731 |
Treasury Stock, Shares | 6,777,858 | 7,089,051 |
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
|
Interest income | ||||
Loans, including fees | $ 66,997 | $ 58,694 | $ 194,820 | $ 167,744 |
Investment securities | ||||
Taxable | 10,326 | 9,986 | 32,405 | 28,875 |
Tax-exempt | 1,083 | 1,163 | 3,401 | 3,419 |
Total interest on investment securities | 11,409 | 11,149 | 35,806 | 32,294 |
Other earning assets | (1,081) | (1,168) | (3,323) | (3,511) |
Total interest income | 77,325 | 68,675 | 227,303 | 196,527 |
Interest expense | ||||
Deposits | 5,600 | 4,861 | 16,587 | 14,302 |
Short-term borrowings | 1,368 | 374 | 3,591 | 930 |
Long-term borrowings | 1,539 | 281 | 4,620 | 876 |
Total interest expense | 8,507 | 5,516 | 24,798 | 16,108 |
Net interest income | 68,818 | 63,159 | 202,505 | 180,419 |
Provision for loan and lease losses | 1,687 | 2,647 | 7,379 | 7,777 |
Net interest income after provision for loan and lease losses | 67,131 | 60,512 | 195,126 | 172,642 |
Noninterest income | ||||
Service charges on deposit accounts | 5,056 | 4,934 | 13,892 | 14,260 |
Trust and wealth management fees | 3,236 | 3,134 | 9,959 | 10,042 |
Bankcard income | 2,984 | 2,909 | 8,996 | 8,501 |
Client derivative fees | 1,210 | 1,604 | 4,104 | 3,444 |
Net gains from sales of loans | 2,066 | 1,758 | 5,093 | 5,146 |
Net gains on sales of investment securities | 398 | 409 | 234 | 1,503 |
FDIC loss sharing income | (638) | (973) | (1,144) | (2,323) |
Accelerated discount on covered/formerly covered loans | 491 | 3,820 | 2,653 | 10,006 |
Other | 2,146 | 2,760 | 8,868 | 8,804 |
Total noninterest income | 16,949 | 20,355 | 52,655 | 59,383 |
Noninterest expenses | ||||
Salaries and employee benefits | 32,093 | 27,768 | 91,234 | 82,160 |
Net occupancy | 4,543 | 4,510 | 13,991 | 13,895 |
Furniture and equipment | 2,139 | 2,165 | 6,482 | 6,537 |
Data processing | 2,828 | 2,591 | 8,311 | 8,020 |
Marketing | 641 | 810 | 2,507 | 2,671 |
Communication | 527 | 531 | 1,485 | 1,659 |
Professional services | 1,460 | 4,092 | 4,572 | 7,789 |
State intangible tax | 639 | 579 | 1,917 | 1,733 |
FDIC assessments | 1,048 | 1,103 | 3,292 | 3,307 |
Loss (gain) - other real estate owned | (112) | 196 | (259) | 1,089 |
Loss sharing expense | 270 | 574 | 555 | 1,451 |
Other | 5,029 | 8,073 | 17,151 | 19,535 |
Total noninterest expenses | 51,105 | 52,992 | 151,238 | 149,846 |
Income before income taxes | 32,975 | 27,875 | 96,543 | 82,179 |
Income tax expense | 10,125 | 9,202 | 31,311 | 26,936 |
Net income | $ 22,850 | $ 18,673 | $ 65,232 | $ 55,243 |
Earnings per common share | ||||
Basic | $ 0.37 | $ 0.31 | $ 1.07 | $ 0.90 |
Diluted | 0.37 | 0.30 | 1.05 | 0.89 |
Cash dividends declared per share | $ 0.16 | $ 0.16 | $ 0.48 | $ 0.48 |
Average common shares outstanding - basic | 61,280,283 | 61,135,749 | 61,170,845 | 61,088,794 |
Average common shares outstanding - diluted | 62,086,067 | 61,987,795 | 61,962,961 | 61,858,724 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
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Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
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Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 22,850 | $ 18,673 | $ 65,232 | $ 55,243 |
Other comprehensive (loss) income, net of tax | ||||
Unrealized gains (losses) on investment securities arising during the period | (162) | 3,057 | 12,073 | 4,287 |
Change in retirement obligation | 200 | 220 | 601 | 624 |
Unrealized gain (loss) on derivatives | 128 | 128 | 384 | (771) |
Unrealized gain (loss) on foreign currency exchange | 0 | 91 | 0 | 50 |
Other comprehensive income (loss) | 166 | 3,496 | 13,058 | 4,190 |
Comprehensive income | $ 23,016 | $ 22,169 | $ 78,290 | $ 59,433 |
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY (Parenthetical) - $ / shares |
3 Months Ended | 9 Months Ended | ||
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Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
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Common Stock, Dividends, Per Share, Declared | $ 0.16 | $ 0.16 | $ 0.48 | $ 0.48 |
BASIS OF PRESENTATION |
9 Months Ended |
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Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION | BASIS OF PRESENTATION The Consolidated Financial Statements of First Financial Bancorp., a bank holding company principally serving Ohio, Indiana and Kentucky, include the accounts and operations of First Financial and its wholly-owned subsidiary, First Financial Bank, N.A. All significant intercompany transactions and accounts have been eliminated in consolidation. Certain reclassifications of prior periods' amounts have been made to conform to current year presentation. Such reclassifications had no effect on net earnings. The preparation of financial statements in conformity with GAAP requires management to make estimates, assumptions and judgments that affect the amounts reported in the Consolidated Financial Statements and accompanying Notes. These estimates, assumptions and judgments are inherently subjective and may be susceptible to significant change. Actual realized amounts could differ materially from these estimates. These interim financial statements have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X, and serve to update the Form 10-K for the year ended December 31, 2015. These interim financial statements may not include all information and notes necessary to constitute a complete set of financial statements under GAAP applicable to annual periods and it is suggested that these interim statements be read in conjunction with the Form 10-K. Management believes these unaudited consolidated financial statements reflect all adjustments of a normal recurring nature which are necessary for a fair presentation of the results for the interim periods presented. The results of operations for the interim periods are not necessarily indicative of the results that may be expected for the full year or any other interim period. The Consolidated Balance Sheet as of December 31, 2015 has been derived from the audited financial statements in the Company’s 2015 Form 10-K. |
RECENTLY ADOPTED AND ISSUED ACCOUNTING STANDARDS |
9 Months Ended |
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Sep. 30, 2016 | |
Recently Adopted and Issued Accounting Standards [Abstract] | |
Recently Adopted and Issued Accounting Standards Disclosure [Text Block] | RECENTLY ADOPTED AND ISSUED ACCOUNTING STANDARDS In April 2015, the FASB issued an update (ASU 2015-03, Interest-Imputation of Interest: Simplifying the Presentation of Debt Issuance Costs) that requires debt issuance costs to be presented as a deduction from the corresponding debt liability. Upon adoption, an entity must apply the new guidance retrospectively to all prior periods presented in the financial statements. The provisions of this update became effective January 1, 2016. First Financial early adopted this accounting standard during the third quarter of 2015. Management concluded that the debt issuance costs capitalized in prior periods was immaterial as a component of other assets, total assets, total long-term debt and total liabilities, and as such, the Company's prior periods have not been restated. In September 2015, the FASB issued an update (ASU 2015-16, Business Combinations: Simplifying the Accounting for Measurement-Period Adjustments) which eliminates the requirement for an acquirer in a business combination to account for measurement-period adjustments retrospectively. This update requires acquiring companies to recognize measurement-period adjustments during the period in which they determine the amounts, including the effect on earnings of any amounts they would have recorded in previous periods if the accounting had been completed at the acquisition date. The guidance in this ASU became effective January 1, 2016 and did not have a material impact on the Company's Consolidated Financial Statements. In January 2016, the FASB issued an update (ASU 2016-01, Financial Instruments-Overall: Recognition and Measurement of Financial Assets and Financial Liabilities) which will require entities to measure many equity investments at fair value and recognize changes in fair value in net income. This update does not apply to equity investments that result in consolidation, those accounted for under the equity method and certain others, and will eliminate use of the available for sale classification for equity securities while providing a new measurement alternative for equity investments that do not have readily determinable fair values and do not qualify for the net asset value practical expedient. The guidance in this ASU will become effective for interim and annual reporting periods beginning after December 15, 2017, with early adoption permitted. First Financial does not anticipate this update will have a material impact on its Consolidated Financial Statements. In February 2016, the FASB issued an update (ASU 2016-02, Leases) which will require lessees to record most leases on their balance sheet and recognize leasing expenses in the income statement. Operating leases, except for short-term leases that are subject to an accounting policy election, will be recorded on the balance sheet for lessees by establishing a lease liability and corresponding right-of-use asset. The guidance in this ASU will become effective for interim and annual reporting periods beginning after December 15, 2018, with early adoption permitted. First Financial is currently evaluating the impact of this update on its Consolidated Financial Statements. In March 2016, the FASB issued an update (ASU 2016-05, Derivatives and Hedging: Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships) which clarifies that the novation of a derivative contract in a hedge accounting relationship does not, in and of itself, require de-designation of that hedge accounting relationship. In the event of a novation, hedge accounting relationships could continue if all other hedge accounting criteria are met, including the expectation that the hedge will be highly effective when the creditworthiness of the new counterparty to the derivative contract is considered. The guidance in this ASU will become effective for interim and annual reporting periods beginning after December 15, 2016, with early adoption permitted. First Financial does not anticipate this update will have a material impact on its Consolidated Financial Statements. In March 2016, the FASB issued an update (ASU 2016-06, Derivatives and Hedging: Contingent Put and Call Options in Debt Instruments) which clarifies that an assessment of whether an embedded contingent put or call option is clearly and closely related to the debt host requires only an analysis of the four-step decision sequence in ASC 815-15-25-42. Entities are required to apply the guidance to existing debt instruments (or hybrid financial instruments that are determined to have a debt host) using a modified retrospective transition method as of the period of adoption. The guidance in this ASU will become effective for interim and annual reporting periods beginning after December 15, 2016, with early adoption permitted. First Financial does not anticipate this update will have a material impact on its Consolidated Financial Statements. In March 2016, the FASB issued an update (ASU 2016-07, Investments-Equity Method and Joint Ventures: Simplifying the Transition to the Equity Method of Accounting) which will eliminate the requirement to retrospectively apply the equity method when an investment that had been accounted for utilizing another method qualifies for use of the equity method. The guidance in this ASU will become effective for interim and annual reporting periods beginning after December 15, 2016, with early adoption permitted. First Financial does not anticipate this update will have a material impact on its Consolidated Financial Statements. In March 2016, the FASB issued an update (ASU 2016-09, Compensation-Stock Compensation: Improvements to Employee Share-Based Payment Accounting) which will require recognition of the income tax effects of share-based awards in the income statement when the awards vest or are settled (i.e., Additional Paid-in-Capital pools will be eliminated). The guidance in this ASU will become effective for interim and annual reporting periods beginning after December 15, 2016, with early adoption permitted. First Financial does not anticipate this update will have a material impact on its Consolidated Financial Statements. In June 2016, the FASB issued an update (ASU 2016-13, Financial Instruments-Credit Losses: Measurement of Credit Losses on Financial Instruments) which significantly changes how entities are required to measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. This update will replace the current incurred loss approach for estimating credit losses with an expected loss model for instruments measured at amortized cost, including loans and leases. Expected credit losses are required to be based on amortized cost and reflect losses expected over the remaining contractual life of the asset. Management is expected to consider any available information relevant to assessing the collectability of contractual cash flows, such as information about past events, current conditions, voluntary prepayments and reasonable and supportable forecasts, when developing expected credit loss estimates. In addition to the new framework for calculating the ALLL, this update requires allowances for available-for-sale debt securities rather than a reduction of the security's carrying amount under the current other-than-temporary impairment model. This update also simplifies the accounting model for purchased credit-impaired debt securities and loans and will require new and updated footnote disclosures. The guidance in this ASU will become effective for interim and annual reporting periods beginning after December 15, 2019. Early adoption is permitted for all entities for interim and annual reporting periods beginning after December 15, 2018. First Financial is currently evaluating the impact of this update on its Consolidated Financial Statements. In August 2016, the FASB issued an update (ASU 2016-15 Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments) which may change how an entity classifies certain cash receipts and cash payments on its statement of cash flows to reduce diversity in practice. The update also provides guidance on when an entity should separate cash flows and classify them into more than one class and when an entity should classify the aggregate of those cash flows into a single class based on the predominance principle. The guidance in this ASU will become effective for interim and annual reporting periods beginning after December 15, 2017, with early adoption permitted. First Financial does not anticipate this update will have a material impact on its Consolidated Financial Statements. |
INVESTMENTS |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVESTMENTS | INVESTMENTS For the three months ending September 30, 2016, proceeds on the sale of $99.4 million of available-for-sale securities resulted in gains of $0.8 million and losses of $0.5 million. For the comparable quarter in 2015, proceeds on the sale of $14.7 million of available-for-sale securities resulted in gains of $0.4 million and no losses. For the nine months ended September 30, 2016, proceeds on the sale of $206.9 million of available-for-sale securities resulted in gains of $1.2 million and losses of $1.0 million. For the nine months ended September 30, 2015, proceeds on the sale of $68.6 million of available-for-sale securities resulted in gains of $1.5 million and no losses. For the three and nine months ended September 30, 2016, the Company sold a single security classified as held-to-maturity to comply with regulatory ownership guidelines. The $4.9 million of proceeds from that sale resulted in a $44 thousand gain. No held-to-maturity securities were sold in 2015. The following is a summary of held-to-maturity and available-for-sale investment securities as of September 30, 2016:
The following is a summary of held-to-maturity and available-for-sale investment securities as of December 31, 2015:
The following table provides a summary of investment securities by contractual maturity or estimated weighted average life as of September 30, 2016. Estimated lives on amortizing investment securities may differ from contractual maturities as issuers may have the right to call or prepay obligations with or without call or prepayment penalties.
The following tables provide the fair value and gross unrealized losses on investment securities in an unrealized loss position, aggregated by investment category and the length of time the individual securities have been in a continuous loss position:
Gains and losses on debt securities are generally due to fluctuations in current market yields relative to the yields of the debt securities at their amortized cost. All securities with unrealized losses are reviewed quarterly to determine if any impairment is considered other than temporary, requiring a write-down to fair value. First Financial considers the percentage loss on a security, duration of the loss, average life or duration of the security, credit rating of the security and payment performance as well as the Company's intent and ability to hold the security to maturity when determining whether any impairment is other than temporary. At this time First Financial does not intend to sell, and it is not more likely than not that the Company will be required to sell debt securities temporarily impaired prior to maturity or recovery of the recorded value. First Financial had no other than temporary impairment related to its investment securities portfolio as of September 30, 2016 or December 31, 2015. For further detail on the fair value of investment securities, see Note 14 – Fair Value Disclosures. |
LOANS AND LEASES |
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LOANS AND LEASES | LOANS AND LEASES First Financial offers clients a variety of commercial and consumer loan and lease products with various interest rates and payment terms. Lending activities are primarily concentrated in states where the Bank currently operates banking centers (Ohio, Indiana and Kentucky). Additionally, First Financial has two national lending platforms, one that provides equipment and leasehold improvement financing for franchisees in the quick service and casual dining restaurant sector and another that provides loans secured by commissions and cash collateral accounts primarily to insurance agents and brokers. Commercial loan categories include commercial and industrial, commercial real estate, construction real estate and lease financing. Consumer loan categories include residential real estate, home equity, installment and credit card. Purchased impaired loans. Loans accounted for under FASB ASC Topic 310-30, Loans and Debt Securities Acquired with Deteriorated Credit Quality, are referred to as purchased impaired loans. First Financial accounts for the majority of loans acquired in FDIC transactions as purchased impaired loans, except for loans with revolving privileges, which are outside the scope of FASB ASC Topic 310-30, and loans for which cash flows could not be estimated, which are accounted for under the cost recovery method. Purchased impaired loans include loans previously covered under loss sharing agreements as well as loans that remain subject to FDIC loss sharing coverage. Purchased impaired loans are not classified as nonperforming assets as the loans are considered to be performing under FASB ASC Topic 310-30. Therefore, interest income, through accretion of the difference between the carrying value of the loans and the expected cash flows (accretable difference) is recognized on all purchased impaired loans. First Financial had purchased impaired loans totaling $151.9 million and $191.6 million, at September 30, 2016 and December 31, 2015, respectively. The outstanding balance of all purchased impaired loans, including all contractual principal, interest, fees and penalties, was $166.4 million and $213.3 million as of September 30, 2016 and December 31, 2015, respectively. These balances exclude contractual interest not yet accrued. Changes in the carrying amount of accretable difference for purchased impaired loans were as follows:
(1) Includes the impact of loan repayments and charge-offs. First Financial regularly reviews its forecast of expected cash flows for purchased impaired loans. Due to changes in the cash flow expectations related to certain loan pools, the Company recognized reclassifications from nonaccretable to accretable difference of $36 thousand for the third quarter of 2016 and $3.8 million for the nine months ended September 30, 2016. The Company recognized reclassifications from nonaccretable to accretable difference during the third quarter of 2015 of $0.1 million, however, during the nine months ended September 30, 2015, the Company recognized reclassifications to accretable from nonaccretable difference of $2.0 million. These reclassifications can result in impairment and provision expense in the current period or yield adjustments on the related loan pools on a prospective basis. Covered loans. Loans acquired in FDIC-assisted transactions covered under loss sharing agreements whereby the FDIC will reimburse First Financial for the majority of any losses incurred are referred to as covered loans. Covered loans totaled $99.7 million as of September 30, 2016 and $113.3 million as of December 31, 2015. For a detailed discussion of covered loans, please refer to the Loans and Leases note in the Company's 2015 Annual Report on Form 10-K. Credit Quality. To facilitate the monitoring of credit quality for commercial loans, and for purposes of determining an appropriate ALLL, First Financial utilizes the following categories of credit grades: Pass - Higher quality loans that do not fit any of the other categories described below. Special Mention - First Financial assigns a special mention rating to loans and leases with potential weaknesses that deserve management's close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or lease or in First Financial's credit position at some future date. Substandard - First Financial assigns a substandard rating to loans or leases that are inadequately protected by the current sound financial worth and paying capacity of the borrower or of the collateral pledged, if any. Substandard loans and leases have well-defined weaknesses that jeopardize repayment of the debt. Substandard loans and leases are characterized by the distinct possibility that the Company will sustain some loss if the deficiencies are not addressed. Doubtful - First Financial assigns a doubtful rating to loans and leases with all the attributes of a substandard rating with the added characteristic that the weaknesses make collection or liquidation in full highly questionable and improbable, on the basis of currently existing facts, conditions and values. The possibility of loss is extremely high, but because of certain important and reasonably specific pending factors that may work to the advantage and strengthening of the credit quality of the loan or lease, its classification as an estimated loss is deferred until its more exact status may be determined. Pending factors include proposed merger, acquisition or liquidation procedures, capital injection, perfecting liens on additional collateral and refinancing plans. The credit grades previously described are derived from standard regulatory rating definitions and are assigned upon initial approval of credit to borrowers and updated periodically thereafter. First Financial considers repayment performance to be the best indicator of credit quality for consumer loans. Consumer loans that have principal and interest payments that are past due by 90 days or more are generally classified as nonperforming. Additionally, consumer loans that have been modified in a TDR are classified as nonperforming. Commercial and consumer credit exposure by risk attribute was as follows:
Delinquency. Loans are considered past due or delinquent when the contractual principal or interest due in accordance with the terms of the loan agreement or any portion thereof remains unpaid after the date of the scheduled payment. Loan delinquency, including loans classified as nonaccrual, was as follows:
Nonaccrual. Loans are classified as nonaccrual when, in the opinion of management, collection of principal or interest is doubtful or when principal or interest payments are 90 days or more past due. Generally, loans are classified as nonaccrual due to the continued failure to adhere to contractual payment terms by the borrower, coupled with other pertinent factors such as insufficient collateral value. The accrual of interest income is discontinued and previously accrued but unpaid interest is reversed when a loan is classified as nonaccrual. Any payments received while a loan is on nonaccrual status are applied as a reduction to the carrying value of the loan. A loan may return to accrual status if collection of future principal and interest payments is no longer doubtful. Purchased impaired loans are classified as performing, even though they may be contractually past due, as any nonpayment of contractual principal or interest is considered in the periodic re-estimation of expected cash flows and is included in the resulting recognition of current period provision for loan and lease losses or prospective yield adjustments. Troubled Debt Restructurings. A loan modification is considered a TDR when the borrower is experiencing financial difficulty and concessions are made by the Company that would not otherwise be considered for a borrower with similar credit characteristics. The most common types of modifications include interest rate reductions, maturity extensions and modifications to principal amortization, including interest-only structures. Modified terms are dependent upon the financial position and needs of the individual borrower. If the modification agreement is violated, the loan is managed by the Company’s credit administration group for resolution, which may result in foreclosure in the case of real estate. TDRs are generally classified as nonaccrual for a minimum period of six months and may qualify for return to accrual status once they have demonstrated performance with the restructured terms of the loan agreement. First Financial had 257 TDRs totaling $37.8 million at September 30, 2016, including $32.2 million on accrual status and $5.6 million classified as nonaccrual. First Financial had $0.7 million of commitments outstanding to lend additional funds to borrowers whose loan terms have been modified through TDRs, and the ALLL included reserves of $2.5 million related to TDRs at September 30, 2016. For the three months ended September 30, 2016 and 2015, the Company charged off $7 thousand and $0.7 million, respectively, for the portion of TDRs determined to be uncollectible. For the nine months ended September 30, 2016 and 2015, First Financial charged off $0.5 million and $2.5 million respectively, for the portion of TDRs determined to be uncollectible. Additionally, as of September 30, 2016, approximately $13.8 million of accruing TDRs have been performing in accordance with the restructured terms for more than one year. First Financial had 271 TDRs totaling $38.2 million at December 31, 2015, including $28.9 million of loans on accrual status and $9.3 million classified as nonaccrual. First Financial had $1.8 million of commitments outstanding to lend additional funds to borrowers whose loan terms had been modified through TDRs. At December 31, 2015, the ALLL included reserves of $2.2 million related to TDRs, and $10.3 million of the accruing TDRs had been performing in accordance with the restructured terms for more than one year. The following tables provide information on loan modifications classified as TDRs during the three and nine months ended September 30, 2016 and 2015:
The following table provides information on how TDRs were modified during the three and nine months ended September 30, 2016 and 2015.
(1) Includes covenant modifications and other concessions, or combination of concessions, that do not consist of interest rate adjustments, forbearance and maturity extensions First Financial considers repayment performance as an indication of the effectiveness of the Company's loan modifications. Borrowers that are 90 days or more past due on any principal or interest payments, or who prematurely terminate a restructured loan agreement without paying off the contractual principal balance (for example, in a deed-in-lieu arrangement), are considered to be in payment default of the terms of the TDR agreement. For the three months ended September 30, 2016, there were no TDRs for which there was a payment default during the period that occurred within twelve months of the loan modification. For the comparable period in 2015, there were three TDRs with a balance of $0.4 million that experienced a payment default within twelve months of the modification. For the nine months ended September 30, 2016 and 2015, there were four and eight TDRs, respectively, with balances of $0.3 million and $1.6 million, respectively, for which there was a payment default during the period that occurred within twelve months of the loan modification. Impaired Loans. Loans classified as nonaccrual and loans modified as TDRs are considered impaired. The following table provides information on impaired loans, excluding purchased impaired loans.
(1) Nonaccrual loans include nonaccrual TDRs of $5.6 million and $9.3 million as of September 30, 2016 and December 31, 2015, respectively.
First Financial individually reviews all impaired commercial loan relationships greater than $250,000, as well as consumer loan TDRs greater than $100,000, to determine if a specific allowance is necessary based on the borrower’s overall financial condition, resources and payment record, support from guarantors and the realizable value of any collateral. Specific allowances are based on discounted cash flows using the loan's initial effective interest rate or the fair value of the collateral for certain collateral dependent loans. First Financial's investment in impaired loans was as follows:
First Financial's average impaired loans by class and interest income recognized by class was as follows:
OREO. OREO consists of properties acquired by the Company primarily through the loan foreclosure or repossession process, or other resolution activity that results in partial or total satisfaction of problem loans. Changes in OREO were as follows:
The preceding table includes OREO subject to loss sharing agreements of $0.1 million and $1.4 million at September 30, 2016 and 2015, respectively. FDIC indemnification asset. Changes in the balance of the FDIC indemnification asset and the related impact to the Consolidated Statements of Income are presented in the table that follows:
The accounting for the FDIC indemnification asset is closely related to the accounting for the underlying, indemnified assets as well as the on-going assessment of the collectibility of the indemnification asset. The primary activities impacting the FDIC indemnification asset are FDIC claims, amortization, FDIC loss sharing income and accelerated discount. For a detailed discussion on the indemnification asset, please refer to the Loans and Leases note in the Company's 2015 Annual Report on Form 10-K. |
ALLOWANCE FOR LOAN AND LEASE LOSSES |
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ALLOWANCE FOR LOAN AND LEASE LOSSES | ALLOWANCE FOR LOAN AND LEASE LOSSES Loans and leases. Management maintains the ALLL at a level that it considers sufficient to absorb probable incurred loan and lease losses inherent in the portfolio. Management determines the adequacy of the ALLL based on historical loss experience as well as other significant factors such as composition of the portfolio, economic conditions, geographic footprint, the results of periodic internal and external evaluations of delinquent, nonaccrual and classified loans and any other adverse situations that may affect a specific borrower's ability to repay, including the timing of future payments. The ALLL is increased by provision expense and decreased by charge-offs, net of recoveries of amounts previously charged-off. First Financial's policy is to charge-off all or a portion of a loan when, in management's opinion, it is unlikely to collect the principal amount owed in full either through payments from the borrower or from the liquidation of collateral. In the third quarter of 2015, First Financial closed its merger with Oak Street. Loans acquired in this transaction were recorded at estimated fair value at the acquisition date with no carryover of the related ALLL. See Note 15 – Business Combinations for further detail. Covered/formerly covered loans. The majority of covered/formerly covered loans are purchased impaired loans, whereby First Financial is required to periodically re-estimate the expected cash flows on the loans. First Financial updated the valuations related to covered/formerly covered loans during the third quarter of 2016. Changes in the allowance for loan and lease losses were as follows:
Changes in the allowance for loan and lease losses by loan category were as follows:
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GOODWILL AND OTHER INTANGIBLE ASSETS |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
GOODWILL AND OTHER INTANGIBLE ASSETS | GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill. Assets and liabilities acquired in a business combination are recorded at their estimated fair values as of the acquisition date. The excess cost of the acquisition over the fair value of net assets acquired is recorded as goodwill. First Financial recorded no additions to goodwill in the first nine months of 2016. Additions to goodwill in 2015 resulted from the acquisition of Oak Street in the third quarter. For further detail on the Oak Street acquisition, see Note 15 – Business Combinations. Changes in the carrying amount of goodwill for the quarter ended September 30, 2016 and the year ended December 31, 2015 were as follows:
Goodwill is not amortized, but is evaluated for impairment on an annual basis as of October 1 of each year, or whenever events or changes in circumstances indicate that the fair value of a reporting unit may be below its carrying value. First Financial performed its most recent annual impairment test as of October 1, 2015 and no impairment was indicated. As of September 30, 2016, no events or changes in circumstances indicated that the fair value of a reporting unit was below its carrying value. Other intangible assets. As of September 30, 2016 and December 31, 2015, First Financial has $6.8 million and $7.8 million, respectively, of other intangible assets which are included in Goodwill and other intangibles in the Consolidated Balance Sheets and primarily consist of core deposit intangibles. Core deposit intangibles represent the estimated fair value of acquired customer deposit relationships. Core deposit intangibles are recorded at estimated fair value at the date of acquisition and are then amortized on an accelerated basis over their estimated useful lives. Core deposit intangibles were $4.8 million and $5.9 million as of September 30, 2016 and December 31, 2015, respectively. First Financial's core deposit intangibles have an estimated weighted average remaining life of 5.0 years. Amortization expense recognized on intangible assets was $0.4 million for each of the three months ended September 30, 2016 and 2015. Amortization expense recognized on intangible assets for the nine months ended September 30, 2016 and 2015 was $1.2 million and $1.3 million, respectively. |
BORROWINGS |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
BORROWINGS | BORROWINGS Short-term borrowings on the Consolidated Balance Sheets include repurchase agreements utilized for corporate sweep accounts with cash management account agreements in place, overnight advances from the FHLB and a short-term line of credit. All repurchase agreements are subject to terms and conditions of repurchase security agreements between the Bank and the client. To secure it's liability to the client, the Bank is authorized to sell or repurchase U.S. Treasury, government agency and mortgage-backed securities. First Financial had $848.3 million in short-term borrowings with the FHLB at September 30, 2016 and $849.1 million as of December 31, 2015. These short-term borrowings are used to manage normal liquidity needs and support the Company's asset and liability management strategies. First Financial has a $15.0 million short-term credit facility with an unaffiliated bank that matures on May 29, 2017. This facility can have a variable or fixed interest rate and provides First Financial additional liquidity, if needed, for various corporate activities, including the repurchase of First Financial common stock and the payment of dividends to shareholders. As of September 30, 2016 and December 31, 2015, there was no outstanding balance. The credit agreement requires First Financial to comply with certain covenants including those related to asset quality and capital levels, and First Financial was in compliance with all covenants associated with this facility as of September 30, 2016 and December 31, 2015. During the third quarter of 2015, First Financial issued $120.0 million of subordinated notes. The subordinated notes have a fixed interest rate of 5.125% payable semiannually and mature on August 25, 2025. These notes are not redeemable by the Company, or callable by the holders of the notes, prior to maturity. The subordinated notes are treated as Tier 2 capital for regulatory capital purposes and are included in Long-term debt on the Consolidated Balance Sheets. Long-term debt also includes $0.4 million and $0.5 million of FHLB long-term advances as of September 30, 2016 and December 31, 2015, respectively. These instruments are primarily utilized to reduce overnight liquidity risk and to mitigate interest rate sensitivity on the Consolidated Balance Sheets. The following is a summary of First Financial's long-term debt:
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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) Shareholders’ equity is affected by transactions and valuations of asset and liability positions that require adjustments to accumulated other comprehensive income (loss). The related tax effects allocated to other comprehensive income and reclassifications out of accumulated other comprehensive income (loss) are as follows:
The following table presents the activity reclassified from accumulated other comprehensive income into income during the three and nine month periods ended September 30, 2016 and 2015, respectively:
(1) Negative amounts are reductions to net income. (2) Included in the computation of net periodic pension cost (see Note 12 - Employee Benefit Plans for additional details). |
DERIVATIVES |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DERIVATIVES | DERIVATIVES First Financial uses certain derivative instruments, including interest rate caps, floors and swaps, to meet the needs of its clients while managing the interest rate risk associated with certain transactions. First Financial does not use derivatives for speculative purposes. First Financial primarily utilizes interest rate swaps as a means to offer borrowers credit-based products that meet their needs and may from time to time utilize interest rate swaps to manage the interest rate risk profile of the Company. Interest rate swap agreements establish the basis on which interest rate payments are exchanged with counterparties, referred to as the notional amount. As only interest rate payments are exchanged, the cash requirements and credit risk associated with interest rate swaps are significantly less than the notional amount and the Company’s credit risk exposure is limited to the market value of the instruments. First Financial manages this market value credit risk through counterparty credit policies, which require the Company to maintain a total derivative notional position of less than 35% of assets, total credit exposure of less than 3% of capital and no single counterparty credit risk exposure greater than $20.0 million. The Company is currently below all single counterparty and portfolio limits. At September 30, 2016, the Company had a total counterparty notional amount outstanding of $697.4 million, spread among ten counterparties, with an outstanding liability from these contracts of $26.9 million. At December 31, 2015, the Company had a total counterparty notional amount outstanding of $551.7 million, spread among nine counterparties, with an outstanding liability from these contracts of $13.4 million. First Financial’s exposure to credit loss, in the event of nonperformance by a borrower, is limited to the market value of the derivative instrument associated with that borrower. First Financial monitors its derivative credit exposure to borrowers by monitoring the creditworthiness of the related loan customers through the normal credit review processes the Company performs on all borrowers. Additionally, the Company monitors derivative credit risk exposure related to problem loans through the Company's ALLL committee. First Financial considers the market value of a derivative instrument to be part of the carrying value of the related loan for these purposes as the borrower is contractually obligated to pay First Financial this amount in the event the derivative contract is terminated. Client Derivatives. First Financial utilizes interest rate swaps as a means to offer commercial borrowers fixed rate funding while providing the Company with floating rate assets. The following table details the classification and amounts recognized in the Consolidated Balance Sheets for client derivatives:
In connection with its use of derivative instruments, First Financial and its counterparties are required to post cash collateral to offset the market position of the derivative instruments under certain conditions. First Financial maintains the right to offset these derivative positions with the collateral posted against them by or with the relevant counterparties. First Financial classifies the derivative cash collateral outstanding with its counterparties as an adjustment to the fair value of the derivative contracts within Accrued interest and other assets or Accrued interest and other liabilities in the Consolidated Balance Sheets. The following table discloses the gross and net amounts of liabilities recognized in the Consolidated Balance Sheets:
The following table details the derivative financial instruments, the average remaining maturities and the weighted-average interest rates being paid and received by First Financial at September 30, 2016:
Credit Derivatives. In conjunction with participating interests in commercial loans, First Financial periodically enters into risk participation agreements with counterparties whereby First Financial assumes a portion of the credit exposure associated with an interest rate swap on the participated loan in exchange for a fee. Under these agreements, First Financial will make payments to the counterparty if the loan customer defaults on its obligation to perform under the interest rate swap contract with the counterparty. The total notional value of these agreements totaled $65.3 million as of September 30, 2016 and $33.6 million as of December 31, 2015. The fair value of these agreements was recorded on the Consolidated Balance Sheets in Accrued interest and other liabilities and was $0.1 million as of September 30, 2016 and December 31, 2015, respectively. Mortgage Derivatives. First Financial enters into IRLCs and forward commitments for the future delivery of mortgage loans to third party investors, which are considered derivatives. When borrowers secure an IRLC with First Financial and the loan is intended to be sold, First Financial will enter into forward commitments for the future delivery of the loans to third party investors in order to hedge against the effect of changes in interest rates impacting IRLCs and loans held for sale. At September 30, 2016, the notional amount of the IRLCs was $32.6 million and the notional amount of forward commitments was $34.0 million. As of December 31, 2015, the notional amount of IRLCs was $18.5 million and the notional amount of forward commitments was $25.1 million. The fair value of these agreements was recorded on the Consolidated Balance Sheets in Accrued interest and other assets and was $0.3 million at September 30, 2016 and $0.1 million at December 31, 2015. |
COMMITMENTS AND CONTINGENCIES |
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Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES First Financial offers a variety of financial instruments with off-balance-sheet risk to assist clients in meeting their requirement for liquidity and credit enhancement. These financial instruments include standby letters of credit and outstanding commitments to extend credit. GAAP does not require these financial instruments to be recorded in the Consolidated Financial Statements. First Financial utilizes the same credit policies in issuing commitments and conditional obligations as it does for credit instruments recorded on the Consolidated Balance Sheets. First Financial’s exposure to credit loss, in the event of nonperformance by the counterparty to the financial instrument for standby letters of credit and outstanding commitments to extend credit, is represented by the contractual amounts of those instruments. First Financial utilizes the ALLL methodology to maintain a reserve that it considers sufficient to absorb probable incurred losses inherent in standby letters of credit and outstanding loan commitments and records the reserve within Accrued interest and other liabilities on the Consolidated Balance Sheets. Loan commitments. Loan commitments are agreements to extend credit to a client, absent any violation of conditions established in the commitment agreement. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The amount of collateral obtained, if deemed necessary by First Financial upon extension of credit, is based on management’s credit evaluation of the client. The collateral held varies, but may include securities, real estate, inventory, plant or equipment. First Financial had commitments outstanding to extend credit totaling $2.0 billion at September 30, 2016 and December 31, 2015. Letters of credit. Letters of credit are conditional commitments issued by First Financial to guarantee the performance of a client to a third party. First Financial’s portfolio of standby letters of credit consists primarily of performance assurances made on behalf of clients who have a contractual commitment to produce or deliver goods or services. The risk to First Financial arises from its obligation to make payment in the event of the client's contractual default to produce the contracted good or service to a third party. First Financial issued letters of credit (including standby letters of credit) aggregating $18.0 million and $16.3 million at September 30, 2016 and December 31, 2015, respectively. Management conducts regular reviews of these instruments on an individual client basis. Investments in affordable housing tax credits. First Financial has made investments in certain qualified affordable housing tax credits. These credits are an indirect federal subsidy that provide tax incentives to encourage investment in the development, acquisition and rehabilitation of affordable rental housing, and allow investors to claim tax credits and other tax benefits (such as deductions from taxable income for operating losses) on their federal income tax returns. The principal risk associated with qualified affordable housing investments is the potential for noncompliance with the tax code requirements, such as, failure to rent property to qualified tenants, resulting in unavailability or recapture of the tax credits and other tax benefits. First Financial's affordable housing commitments totaled $37.3 million and $31.5 million as of September 30, 2016 and December 31, 2015, respectively. The affordable housing investments resulted in $0.6 million and $0.4 million of tax credits for the three months ended September 30, 2016 and 2015, and $2.0 million and $1.1 million for the nine months ended September 30, 2016 and 2015, respectively. First Financial had no affordable housing contingent commitments as of September 30, 2016 or December 31, 2015. Investments in historic tax credits. First Financial has noncontrolling financial investments in private investment funds and partnerships which are not consolidated. These investments may generate a return through the realization of federal and state income tax credits, as well as other tax benefits, such as tax deductions from net operating losses of the investments over a period of time. The Company’s recorded investment in these entities, carried in other assets on the Consolidated Balance Sheets, was approximately $1.7 million at September 30, 2016, compared with $1.1 million at December 31, 2015. The maximum exposure to loss related to these investments was $13.8 million at September 30, 2016 and $1.1 million at December 31, 2015, representing the Company’s investment balance and its unfunded commitments to invest additional amounts. Contingencies/Litigation. First Financial and its subsidiaries are engaged in various matters of litigation, other assertions of improper or fraudulent loan practices or lending violations and other matters from time to time, and have a number of unresolved claims pending. Additionally, as part of the ordinary course of business, First Financial and its subsidiaries are parties to litigation involving claims to the ownership of funds in particular accounts, the collection of delinquent accounts, challenges to security interests in collateral and foreclosure interests that are incidental to our regular business activities. While the ultimate liability with respect to these other litigation matters and claims cannot be determined at this time, First Financial believes that damages, if any, and other amounts relating to pending matters are not probable or cannot be reasonably estimated as of September 30, 2016. Reserves are established for these various matters of litigation, when appropriate, under FASB ASC Topic 450, Contingencies, based in part upon the advice of legal counsel. First Financial had no reserves related to litigation matters as of September 30, 2016. As of December 31, 2015, the Company had $1.3 million of reserves related to litigation matters. |
INCOME TAXES |
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Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES For the third quarter 2016, income tax expense was $10.1 million, resulting in an effective tax rate of 30.7%, compared with income tax expense of $9.2 million and an effective tax rate of 33.0% for the comparable period in 2015. The decrease in effective tax rate when comparing third quarter 2016 to third quarter 2015 was primarily driven by favorable provision to return adjustments related to affordable housing and qualified rehabilitation investments and a decrease in non-deductible acquisition costs, which was partially offset by a decline in tax-exempt interest income. For the first nine months of 2016, income tax expense was $31.3 million, resulting in an effective tax rate of 32.4% compared with income tax expense of $26.9 million and an effective tax rate of 32.8% for the comparable period in 2015. At September 30, 2016, and December 31, 2015, First Financial had no FASB ASC Topic 740-10 unrecognized tax benefits recorded. First Financial does not expect the total amount of unrecognized tax benefits to significantly increase within the next twelve months. First Financial regularly reviews its tax positions and establishes reserves for income tax-related uncertainties based on estimates of whether it is more likely than not that the tax uncertainty would be sustained upon challenge by the appropriate tax authorities, which would then result in additional taxes, penalties and interest due. Management determined that no reserve for income tax-related uncertainties was necessary as of September 30, 2016 and December 31, 2015. First Financial and its subsidiaries are subject to U.S. federal income tax as well as state and local income tax in several jurisdictions. Tax years prior to 2013 have been closed and are no longer subject to U.S. federal income tax examinations. Tax years 2013 through 2015 remain open to examination by the federal taxing authority. First Financial is no longer subject to state and local income tax examinations for years prior to 2011. Tax years 2011 through 2015 remain open to state and local examination in various jurisdictions. |
EMPLOYEE BENEFIT PLANS |
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Compensation and Retirement Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
EMPLOYEE BENEFIT PLANS | EMPLOYEE BENEFIT PLANS First Financial sponsors a non-contributory defined benefit pension plan covering substantially all employees and uses a December 31 measurement date for the plan. Plan assets were primarily invested in fixed income and publicly traded equity mutual funds. The pension plan does not directly own any shares of First Financial common stock or any other First Financial security or product. First Financial made no cash contributions to fund the pension plan during the nine months ended September 30, 2016, or the year ended December 31, 2015, and does not expect to make cash contributions to the plan through the remainder of the year. As a result of the plan’s actuarial projections, First Financial recorded income of $0.2 million and $0.3 million for the quarters ended September 30, 2016 and 2015, respectively. First Financial recorded income of $0.7 million and $0.9 million for the nine months ended September 30, 2016 and 2015, respectively. The following table sets forth information concerning amounts recognized in First Financial’s Consolidated Statements of Income related to the Company's pension plan:
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EARNINGS PER COMMON SHARE |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
EARNINGS PER COMMON SHARE | EARNINGS PER COMMON SHARE The following table sets forth the computation of basic and diluted earnings per share:
Warrants to purchase 141,913 and 369,377 shares of the Company's common stock were outstanding as of September 30, 2016 and 2015, respectively. These warrants, each representing the right to purchase one share of common stock, no par value per share, have an exercise price of $12.12 and expire on December 23, 2018. Stock options and warrants with exercise prices greater than the average market price of the common shares, were not included in the computation of net income per diluted share, as they would have been antidilutive. Using the end of period price, there were no antidilutive options at September 30, 2016 and September 30, 2015. |
FAIR VALUE DISCLOSURES |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FAIR VALUE DISCLOSURES | FAIR VALUE DISCLOSURES Fair Value Measurement The fair value framework as disclosed in the Fair Value Topic includes a hierarchy which focuses on prioritizing the inputs used in valuation techniques. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1), a lower priority to observable inputs other than quoted prices in active markets for identical assets and liabilities (Level 2) and the lowest priority to unobservable inputs (Level 3). When determining the fair value measurements for assets and liabilities, First Financial looks to active markets to price identical assets or liabilities whenever possible and classifies such items in Level 1. When identical assets and liabilities are not traded in active markets, First Financial looks to observable market data for similar assets and liabilities and classifies such items as Level 2. Certain assets and liabilities are not actively traded in observable markets and First Financial must use alternative techniques, based on unobservable inputs, to determine the fair value and classifies such items as Level 3. The level within the fair value hierarchy is based on the lowest level of input that is significant in the fair value measurement. The following methods, assumptions and valuation techniques were used by First Financial to measure different financial assets and liabilities at fair value and in estimating its fair value disclosures for financial instruments. Cash and short-term investments. The carrying amounts reported in the Consolidated Balance Sheets for cash and short-term investments, such as federal funds sold, approximated the fair value of those instruments. The Company classifies cash and short-term investments in Level 1 of the fair value hierarchy. Investment securities. Investment securities classified as trading and available-for-sale are recorded at fair value on a recurring basis. Fair value measurement is based upon quoted market prices, when available (Level 1). If quoted market prices are not available, fair values are measured utilizing independent valuation techniques of identical or similar investment securities. First Financial compiles prices from various sources who may apply such techniques as matrix pricing to determine the value of identical or similar investment securities (Level 2). Matrix pricing is a mathematical technique widely used in the banking industry to value investment securities without relying exclusively on quoted prices for the specific investment securities but rather relying on the investment securities’ relationship to other benchmark quoted investment securities. Any investment securities not valued based upon the methods previously described are considered Level 3. First Financial utilizes values provided by third-party pricing vendors to price the investment securities portfolio in accordance with the fair value hierarchy of the Fair Value Topic and reviews the pricing methodologies utilized by the pricing vendors to ensure that the fair value determination is consistent with the applicable accounting guidance. First Financial’s pricing process includes a series of quality assurance activities where prices are compared to recent market conditions, historical prices and other independent pricing services. Further, the Company periodically validates the fair values of a sample of securities in the portfolio by comparing the fair values to prices from other independent sources for the same or similar securities. First Financial analyzes unusual or significant variances, conducts additional research with the pricing vendor, and if necessary, takes appropriate action based on its findings. The results of the quality assurance process are incorporated into the selection of pricing providers by the portfolio manager. Other investments. Other investments include holdings in FRB and FHLB stock, which are carried at cost due to the inability to determine the fair value as a result of restrictions placed on transferability. Loans held for sale. Loans held for sale are carried at fair value. These loans currently consist of one-to-four family residential real estate loans originated for sale to qualified third parties. Fair value is based on the market price or contractual price to be received from these third parties, which is not materially different than cost due to the short duration between origination and sale (Level 2). As such, First Financial records any fair value adjustments on a nonrecurring basis. Gains and losses on the sale of loans are recorded as net gains from sales of loans within noninterest income in the Consolidated Statements of Income. Loans and leases. The fair value of commercial and industrial, commercial real estate, residential real estate and consumer loans were estimated by discounting the future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities or repricing frequency. The Company classifies the estimated fair value of loans as Level 3 in the fair value hierarchy. Impaired loans are specifically reviewed for purposes of determining the appropriate amount of impairment to be allocated to the ALLL. Fair value is generally measured based on the value of the collateral securing the loans. Collateral may be in the form of real estate or business assets including equipment, inventory and accounts receivable. The value of real estate collateral is determined utilizing an income or market valuation approach based on an appraisal conducted by an independent, licensed third-party appraiser (Level 3). The value of business equipment is based upon an outside appraisal, if deemed significant, or the net book value on the applicable borrower financial statements. Likewise, values for inventory and accounts receivable collateral are based on borrower financial statement balances or aging reports on a discounted basis as appropriate (Level 3). Impaired loans are measured at fair value on a nonrecurring basis. Any fair value adjustments are recorded in the period incurred as provision for loan and lease losses on the Consolidated Statements of Income. Fair values for purchased impaired loans are estimated using a discounted cash flow methodology that considers factors that include the type of loan and related collateral, classification status, fixed or variable interest rate, term of loan, whether or not the loan was amortizing and a discount rate reflecting the Company's assessment of risk inherent in the cash flow estimates. These loans are grouped together according to similar characteristics and are treated in the aggregate when applying various valuation techniques. First Financial estimates the cash flows expected to be collected on these loans based upon the expected remaining life of the underlying loans, which includes the effects of estimated prepayments. Fair values for acquired loans accounted for outside of FASB ASC Topic 310-30 are estimated by discounting the future cash flows using current interest rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities or repricing frequency. OREO. Assets acquired through loan foreclosure are initially recorded at the lower of cost or fair value less costs to sell. The carrying value of OREO is not re-measured to fair value on a recurring basis, but is subject to fair value adjustments when the carrying value exceeds the fair value, less estimated selling costs. Fair value is based on recent real estate appraisals and is updated at least annually. The Company classifies OREO in level 3 of the fair value hierarchy. FDIC indemnification asset. Fair value of the FDIC indemnification asset is estimated using projected cash flows related to the loss sharing agreements based on expected reimbursements for losses and the applicable loss sharing percentages. The expected cash flows are discounted to reflect the uncertainty of the timing and receipt of the loss sharing reimbursement from the FDIC. The five year period of loss protection expired for the majority of First Financial's covered commercial loans and covered OREO effective October 1, 2014. The Company classifies the estimated fair value of the indemnification asset as Level 3 in the fair value hierarchy. Accrued interest receivable and payable. The carrying amount of accrued interest receivable and accrued interest payable approximate their fair values and is aligned with the underlying assets or liabilities (Level 1, Level 2 or Level 3). Deposits. The fair value of demand deposits, savings accounts and certain money-market deposits represents the amount payable on demand at the reporting date. The carrying amounts for variable-rate CDs approximated their fair values at the reporting date. The fair value of fixed-rate CDs is estimated using a discounted cash flow calculation which applies the interest rates currently offered for deposits of similar remaining maturities. The Company classifies the estimated fair value of deposit liabilities as Level 2 in the fair value hierarchy. Borrowings. The carrying amounts of federal funds purchased and securities sold under agreements to repurchase and other short-term borrowings approximate their fair values. The Company classifies the estimated fair value of short-term borrowings as Level 1 in the fair value hierarchy. The fair value of long-term debt is estimated using a discounted cash flow calculation which utilizes the interest rates currently offered for borrowings of similar remaining maturities. The Company classifies the estimated fair value of long-term debt as Level 2 in the fair value hierarchy. Derivatives. The fair values of derivative instruments are based primarily on a net present value calculation of the cash flows related to the interest rate swaps at the reporting date, using primarily observable market inputs such as interest rate yield curves which represents the cost to terminate the swap if First Financial should choose to do so. Additionally, First Financial utilizes an internally-developed model to value the credit risk component of derivative assets and liabilities, which is recorded as an adjustment to the fair value of the derivative asset or liability on the reporting date. Derivative instruments are classified as Level 2 in the fair value hierarchy. The estimated fair values of First Financial’s financial instruments not measured at fair value on a recurring or nonrecurring basis in the consolidated financial statements were as follows:
The financial assets and liabilities measured at fair value on a recurring basis in the consolidated financial statements were as follows:
Certain financial assets and liabilities are measured at fair value on a nonrecurring basis. Adjustments to the fair market value of these assets usually result from the application of lower of cost or fair value accounting or write-downs of individual assets. The following table summarizes financial assets and liabilities measured at fair value on a nonrecurring basis.
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BUSINESS COMBINATIONS |
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Business Combinations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
BUSINESS COMBINATIONS | BUSINESS COMBINATIONS Oak Street is a nationwide lender based in Indianapolis, Indiana that provides loans, secured by commissions and cash collateral accounts, primarily to insurance agents and brokers to grow their agency business and maximize their book-of-business value. Oak Street's lending activities are driven by agency acquisitions, agency ownership transitions, the purchase by agencies of books of business, as well as financing general working capital needs. The underwriting of these loans involves analyses of collateral (through use of Oak Street's proprietary software system) that consists of insurance commissions revenue, which is then monitored throughout the life of the loans. On August 14, 2015, First Financial acquired Oak Street for cash consideration and concurrent with the close of the transaction, First Financial paid off all of Oak Street's existing long-term debt, replacing higher-cost funding with the Company's lower-cost funding sources. The Oak Street transaction was accounted for using the acquisition method of accounting and accordingly, assets acquired, liabilities assumed and consideration exchanged were recorded at estimated fair value on the acquisition date, in accordance with FASB ASC Topic 805, Business Combinations. The fair value measurements of assets acquired and liabilities assumed are subject to refinement for up to one year after the closing date of the acquisition as additional information relative to closing date fair values become available. No additional information became available during the third quarter of 2016 that required adjustment to the fair value of the assets or liabilities acquired from Oak Street. The following table provides the purchase price calculation as of the acquisition date and the identifiable assets purchased and the liabilities assumed at their estimated fair value:
The goodwill arising from the Oak Street acquisition reflects the business's high growth potential and scalable platform. The acquisition leverages First Financial’s excess capital and is expected to provide additional revenue growth and diversification. The goodwill is not deductible for income tax purposes as the merger was accounted for as a tax-free exchange. The tax-free exchange resulted in a carryover of tax attributes and tax basis to the Company's subsequent income tax filings and was adjusted for any fair value adjustments required in accounting for the acquisitions. For further detail, see Note 6 – Goodwill and Other Intangible Assets. |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) |
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Basis of Presentation Policy | The Consolidated Financial Statements of First Financial Bancorp., a bank holding company principally serving Ohio, Indiana and Kentucky, include the accounts and operations of First Financial and its wholly-owned subsidiary, First Financial Bank, N.A. All significant intercompany transactions and accounts have been eliminated in consolidation. Certain reclassifications of prior periods' amounts have been made to conform to current year presentation. Such reclassifications had no effect on net earnings. |
Use of Estimates, Policy | The preparation of financial statements in conformity with GAAP requires management to make estimates, assumptions and judgments that affect the amounts reported in the Consolidated Financial Statements and accompanying Notes. These estimates, assumptions and judgments are inherently subjective and may be susceptible to significant change. Actual realized amounts could differ materially from these estimates. |
Certain Loans and Debt Securities Acquired in Transfer, Recognizing Interest Income on Impaired Loans, Policy | Loans accounted for under FASB ASC Topic 310-30, Loans and Debt Securities Acquired with Deteriorated Credit Quality, are referred to as purchased impaired loans. First Financial accounts for the majority of loans acquired in FDIC transactions as purchased impaired loans, except for loans with revolving privileges, which are outside the scope of FASB ASC Topic 310-30, and loans for which cash flows could not be estimated, which are accounted for under the cost recovery method. Purchased impaired loans include loans previously covered under loss sharing agreements as well as loans that remain subject to FDIC loss sharing coverage. Purchased impaired loans are not classified as nonperforming assets as the loans are considered to be performing under FASB ASC Topic 310-30. Therefore, interest income, through accretion of the difference between the carrying value of the loans and the expected cash flows (accretable difference) is recognized on all purchased impaired loans. |
Loans and Leases Receivable, Past Due Status, Policy | Loans are considered past due or delinquent when the contractual principal or interest due in accordance with the terms of the loan agreement or any portion thereof remains unpaid after the date of the scheduled payment. |
Loans and Leases Receivable, Nonaccrual Loan and Lease Status, Policy | Loans are classified as nonaccrual when, in the opinion of management, collection of principal or interest is doubtful or when principal or interest payments are 90 days or more past due. Generally, loans are classified as nonaccrual due to the continued failure to adhere to contractual payment terms by the borrower, coupled with other pertinent factors such as insufficient collateral value. The accrual of interest income is discontinued and previously accrued but unpaid interest is reversed when a loan is classified as nonaccrual. Any payments received while a loan is on nonaccrual status are applied as a reduction to the carrying value of the loan. A loan may return to accrual status if collection of future principal and interest payments is no longer doubtful. Purchased impaired loans are classified as performing, even though they may be contractually past due, as any nonpayment of contractual principal or interest is considered in the periodic re-estimation of expected cash flows and is included in the resulting recognition of current period provision for loan and lease losses or prospective yield adjustments. |
Loans and Leases Receivable, Troubled Debt Restructuring Policy | A loan modification is considered a TDR when the borrower is experiencing financial difficulty and concessions are made by the Company that would not otherwise be considered for a borrower with similar credit characteristics. The most common types of modifications include interest rate reductions, maturity extensions and modifications to principal amortization, including interest-only structures. Modified terms are dependent upon the financial position and needs of the individual borrower. If the modification agreement is violated, the loan is managed by the Company’s credit administration group for resolution, which may result in foreclosure in the case of real estate. TDRs are generally classified as nonaccrual for a minimum period of six months and may qualify for return to accrual status once they have demonstrated performance with the restructured terms of the loan agreement. |
Impaired Financing Receivable, Policy | First Financial individually reviews all impaired commercial loan relationships greater than $250,000, as well as consumer loan TDRs greater than $100,000, to determine if a specific allowance is necessary based on the borrower’s overall financial condition, resources and payment record, support from guarantors and the realizable value of any collateral. Specific allowances are based on discounted cash flows using the loan's initial effective interest rate or the fair value of the collateral for certain collateral dependent loans. Loans classified as nonaccrual and loans modified as TDRs are considered impaired. |
Loans and Leases Receivable, Real Estate Acquired Through Foreclosure, Policy | OREO consists of properties acquired by the Company primarily through the loan foreclosure or repossession process, or other resolution activity that results in partial or total satisfaction of problem loans. |
Loans and Leases Receivable, Allowance for Loan Losses Policy | Management maintains the ALLL at a level that it considers sufficient to absorb probable incurred loan and lease losses inherent in the portfolio. Management determines the adequacy of the ALLL based on historical loss experience as well as other significant factors such as composition of the portfolio, economic conditions, geographic footprint, the results of periodic internal and external evaluations of delinquent, nonaccrual and classified loans and any other adverse situations that may affect a specific borrower's ability to repay, including the timing of future payments. The ALLL is increased by provision expense and decreased by charge-offs, net of recoveries of amounts previously charged-off. First Financial's policy is to charge-off all or a portion of a loan when, in management's opinion, it is unlikely to collect the principal amount owed in full either through payments from the borrower or from the liquidation of collateral. |
Goodwill and Intangible Assets, Goodwill, Policy | Assets and liabilities acquired in a business combination are recorded at their estimated fair values as of the acquisition date. The excess cost of the acquisition over the fair value of net assets acquired is recorded as goodwill. |
Goodwill and Intangible Assets, Goodwill Impairment Policy | Goodwill is not amortized, but is evaluated for impairment on an annual basis as of October 1 of each year, or whenever events or changes in circumstances indicate that the fair value of a reporting unit may be below its carrying value. |
Goodwill and Intangible Assets, Policy | Core deposit intangibles represent the estimated fair value of acquired customer deposit relationships. Core deposit intangibles are recorded at estimated fair value at the date of acquisition and are then amortized on an accelerated basis over their estimated useful lives. |
Income Tax, Policy | First Financial regularly reviews its tax positions and establishes reserves for income tax-related uncertainties based on estimates of whether it is more likely than not that the tax uncertainty would be sustained upon challenge by the appropriate tax authorities, which would then result in additional taxes, penalties and interest due. |
Commitments and Contingencies, Policy | First Financial offers a variety of financial instruments with off-balance-sheet risk to assist clients in meeting their requirement for liquidity and credit enhancement. These financial instruments include standby letters of credit and outstanding commitments to extend credit. GAAP does not require these financial instruments to be recorded in the Consolidated Financial Statements. First Financial utilizes the same credit policies in issuing commitments and conditional obligations as it does for credit instruments recorded on the Consolidated Balance Sheets. First Financial’s exposure to credit loss, in the event of nonperformance by the counterparty to the financial instrument for standby letters of credit and outstanding commitments to extend credit, is represented by the contractual amounts of those instruments. First Financial utilizes the ALLL methodology to maintain a reserve that it considers sufficient to absorb probable incurred losses inherent in standby letters of credit and outstanding loan commitments and records the reserve within Accrued interest and other liabilities on the Consolidated Balance Sheets. |
Fair Value of Financial Instruments, Policy | Fair Value Measurement The fair value framework as disclosed in the Fair Value Topic includes a hierarchy which focuses on prioritizing the inputs used in valuation techniques. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1), a lower priority to observable inputs other than quoted prices in active markets for identical assets and liabilities (Level 2) and the lowest priority to unobservable inputs (Level 3). When determining the fair value measurements for assets and liabilities, First Financial looks to active markets to price identical assets or liabilities whenever possible and classifies such items in Level 1. When identical assets and liabilities are not traded in active markets, First Financial looks to observable market data for similar assets and liabilities and classifies such items as Level 2. Certain assets and liabilities are not actively traded in observable markets and First Financial must use alternative techniques, based on unobservable inputs, to determine the fair value and classifies such items as Level 3. The level within the fair value hierarchy is based on the lowest level of input that is significant in the fair value measurement. The following methods, assumptions and valuation techniques were used by First Financial to measure different financial assets and liabilities at fair value and in estimating its fair value disclosures for financial instruments. Cash and short-term investments. The carrying amounts reported in the Consolidated Balance Sheets for cash and short-term investments, such as federal funds sold, approximated the fair value of those instruments. The Company classifies cash and short-term investments in Level 1 of the fair value hierarchy. Investment securities. Investment securities classified as trading and available-for-sale are recorded at fair value on a recurring basis. Fair value measurement is based upon quoted market prices, when available (Level 1). If quoted market prices are not available, fair values are measured utilizing independent valuation techniques of identical or similar investment securities. First Financial compiles prices from various sources who may apply such techniques as matrix pricing to determine the value of identical or similar investment securities (Level 2). Matrix pricing is a mathematical technique widely used in the banking industry to value investment securities without relying exclusively on quoted prices for the specific investment securities but rather relying on the investment securities’ relationship to other benchmark quoted investment securities. Any investment securities not valued based upon the methods previously described are considered Level 3. First Financial utilizes values provided by third-party pricing vendors to price the investment securities portfolio in accordance with the fair value hierarchy of the Fair Value Topic and reviews the pricing methodologies utilized by the pricing vendors to ensure that the fair value determination is consistent with the applicable accounting guidance. First Financial’s pricing process includes a series of quality assurance activities where prices are compared to recent market conditions, historical prices and other independent pricing services. Further, the Company periodically validates the fair values of a sample of securities in the portfolio by comparing the fair values to prices from other independent sources for the same or similar securities. First Financial analyzes unusual or significant variances, conducts additional research with the pricing vendor, and if necessary, takes appropriate action based on its findings. The results of the quality assurance process are incorporated into the selection of pricing providers by the portfolio manager. Other investments. Other investments include holdings in FRB and FHLB stock, which are carried at cost due to the inability to determine the fair value as a result of restrictions placed on transferability. Loans held for sale. Loans held for sale are carried at fair value. These loans currently consist of one-to-four family residential real estate loans originated for sale to qualified third parties. Fair value is based on the market price or contractual price to be received from these third parties, which is not materially different than cost due to the short duration between origination and sale (Level 2). As such, First Financial records any fair value adjustments on a nonrecurring basis. Gains and losses on the sale of loans are recorded as net gains from sales of loans within noninterest income in the Consolidated Statements of Income. Loans and leases. The fair value of commercial and industrial, commercial real estate, residential real estate and consumer loans were estimated by discounting the future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities or repricing frequency. The Company classifies the estimated fair value of loans as Level 3 in the fair value hierarchy. Impaired loans are specifically reviewed for purposes of determining the appropriate amount of impairment to be allocated to the ALLL. Fair value is generally measured based on the value of the collateral securing the loans. Collateral may be in the form of real estate or business assets including equipment, inventory and accounts receivable. The value of real estate collateral is determined utilizing an income or market valuation approach based on an appraisal conducted by an independent, licensed third-party appraiser (Level 3). The value of business equipment is based upon an outside appraisal, if deemed significant, or the net book value on the applicable borrower financial statements. Likewise, values for inventory and accounts receivable collateral are based on borrower financial statement balances or aging reports on a discounted basis as appropriate (Level 3). Impaired loans are measured at fair value on a nonrecurring basis. Any fair value adjustments are recorded in the period incurred as provision for loan and lease losses on the Consolidated Statements of Income. Fair values for purchased impaired loans are estimated using a discounted cash flow methodology that considers factors that include the type of loan and related collateral, classification status, fixed or variable interest rate, term of loan, whether or not the loan was amortizing and a discount rate reflecting the Company's assessment of risk inherent in the cash flow estimates. These loans are grouped together according to similar characteristics and are treated in the aggregate when applying various valuation techniques. First Financial estimates the cash flows expected to be collected on these loans based upon the expected remaining life of the underlying loans, which includes the effects of estimated prepayments. Fair values for acquired loans accounted for outside of FASB ASC Topic 310-30 are estimated by discounting the future cash flows using current interest rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities or repricing frequency. OREO. Assets acquired through loan foreclosure are initially recorded at the lower of cost or fair value less costs to sell. The carrying value of OREO is not re-measured to fair value on a recurring basis, but is subject to fair value adjustments when the carrying value exceeds the fair value, less estimated selling costs. Fair value is based on recent real estate appraisals and is updated at least annually. The Company classifies OREO in level 3 of the fair value hierarchy. FDIC indemnification asset. Fair value of the FDIC indemnification asset is estimated using projected cash flows related to the loss sharing agreements based on expected reimbursements for losses and the applicable loss sharing percentages. The expected cash flows are discounted to reflect the uncertainty of the timing and receipt of the loss sharing reimbursement from the FDIC. The five year period of loss protection expired for the majority of First Financial's covered commercial loans and covered OREO effective October 1, 2014. The Company classifies the estimated fair value of the indemnification asset as Level 3 in the fair value hierarchy. Accrued interest receivable and payable. The carrying amount of accrued interest receivable and accrued interest payable approximate their fair values and is aligned with the underlying assets or liabilities (Level 1, Level 2 or Level 3). Deposits. The fair value of demand deposits, savings accounts and certain money-market deposits represents the amount payable on demand at the reporting date. The carrying amounts for variable-rate CDs approximated their fair values at the reporting date. The fair value of fixed-rate CDs is estimated using a discounted cash flow calculation which applies the interest rates currently offered for deposits of similar remaining maturities. The Company classifies the estimated fair value of deposit liabilities as Level 2 in the fair value hierarchy. Borrowings. The carrying amounts of federal funds purchased and securities sold under agreements to repurchase and other short-term borrowings approximate their fair values. The Company classifies the estimated fair value of short-term borrowings as Level 1 in the fair value hierarchy. The fair value of long-term debt is estimated using a discounted cash flow calculation which utilizes the interest rates currently offered for borrowings of similar remaining maturities. The Company classifies the estimated fair value of long-term debt as Level 2 in the fair value hierarchy. Derivatives. The fair values of derivative instruments are based primarily on a net present value calculation of the cash flows related to the interest rate swaps at the reporting date, using primarily observable market inputs such as interest rate yield curves which represents the cost to terminate the swap if First Financial should choose to do so. Additionally, First Financial utilizes an internally-developed model to value the credit risk component of derivative assets and liabilities, which is recorded as an adjustment to the fair value of the derivative asset or liability on the reporting date. Derivative instruments are classified as Level 2 in the fair value hierarchy. |
Other Contract-Mortgage | |
Derivatives, Methods of Accounting, Hedging Derivatives, Policy | First Financial enters into IRLCs and forward commitments for the future delivery of mortgage loans to third party investors, which are considered derivatives. When borrowers secure an IRLC with First Financial and the loan is intended to be sold, First Financial will enter into forward commitments for the future delivery of the loans to third party investors in order to hedge against the effect of changes in interest rates impacting IRLCs and loans held for sale. |
Credit Risk | |
Derivatives, Methods of Accounting, Hedging Derivatives, Policy | First Financial manages this market value credit risk through counterparty credit policies, which require the Company to maintain a total derivative notional position of less than 35% of assets, total credit exposure of less than 3% of capital and no single counterparty credit risk exposure greater than $20.0 million. |
Fair Value Hedges | |
Derivatives, Methods of Accounting, Hedging Derivatives, Policy | First Financial utilizes interest rate swaps as a means to offer commercial borrowers fixed rate funding while providing the Company with floating rate assets. |
INVESTMENTS (Tables) |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Held-To-Maturity and Available-For-Sale Investment Securities | The following is a summary of held-to-maturity and available-for-sale investment securities as of September 30, 2016:
The following is a summary of held-to-maturity and available-for-sale investment securities as of December 31, 2015:
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Summary of Investment Securities by Estimated Maturity | The following table provides a summary of investment securities by contractual maturity or estimated weighted average life as of September 30, 2016. Estimated lives on amortizing investment securities may differ from contractual maturities as issuers may have the right to call or prepay obligations with or without call or prepayment penalties.
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Age of Gross Unrealized Losses and Associated Fair Value by Investment Category | The following tables provide the fair value and gross unrealized losses on investment securities in an unrealized loss position, aggregated by investment category and the length of time the individual securities have been in a continuous loss position:
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LOANS AND LEASES (Tables) |
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Carrying Amount of Accretable Yield for Purchased Impaired and Nonimpaired Loans | Changes in the carrying amount of accretable difference for purchased impaired loans were as follows:
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Commercial and Consumer Credit Exposure by Risk Attribute | Commercial and consumer credit exposure by risk attribute was as follows:
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Loan Delinquency, including Nonaccrual Loans | Loan delinquency, including loans classified as nonaccrual, was as follows:
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Loans Restructured During Period | The following tables provide information on loan modifications classified as TDRs during the three and nine months ended September 30, 2016 and 2015:
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Loans Restructured, Modifications | The following table provides information on how TDRs were modified during the three and nine months ended September 30, 2016 and 2015.
(1) Includes covenant modifications and other concessions, or combination of concessions, that do not consist of interest rate adjustments, forbearance and maturity extensions |
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Nonaccrual, Restructured and Impaired Loans | The following table provides information on impaired loans, excluding purchased impaired loans.
(1) Nonaccrual loans include nonaccrual TDRs of $5.6 million and $9.3 million as of September 30, 2016 and December 31, 2015, respectively.
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Investment in Impaired Loans | First Financial's investment in impaired loans was as follows:
First Financial's average impaired loans by class and interest income recognized by class was as follows:
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Changes in Other Real Estate Owned | Changes in OREO were as follows:
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Indemnification Asset Rollforward | Changes in the balance of the FDIC indemnification asset and the related impact to the Consolidated Statements of Income are presented in the table that follows:
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ALLOWANCE FOR LOAN AND LEASE LOSSES (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Changes in the Allowance for Loan and Lease Losses for the Current and Comparable Quarter | Changes in the allowance for loan and lease losses were as follows:
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Allowance for Loan and Lease Losses by Classification | Changes in the allowance for loan and lease losses by loan category were as follows:
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GOODWILL AND OTHER INTANGIBLE ASSETS GOODWILL (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
Changes in Carrying Amount of Goodwill | Changes in the carrying amount of goodwill for the quarter ended September 30, 2016 and the year ended December 31, 2015 were as follows:
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BORROWINGS (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Long-term Debt | The following is a summary of First Financial's long-term debt:
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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related Tax Effects Allocated to Other Comprehensive Income and Accumulated Other Comprehensive Income (Loss) | The related tax effects allocated to other comprehensive income and reclassifications out of accumulated other comprehensive income (loss) are as follows:
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Other Accumulated Comprehensive income reclassified from AOCI | The following table presents the activity reclassified from accumulated other comprehensive income into income during the three and nine month periods ended September 30, 2016 and 2015, respectively:
(1) Negative amounts are reductions to net income. (2) Included in the computation of net periodic pension cost (see Note 12 - Employee Benefit Plans for additional details). |
DERIVATIVES (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Derivative Financial Instruments and Balances | The following table details the classification and amounts recognized in the Consolidated Balance Sheets for client derivatives:
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Disclosure by Type of Financial Instrument | The following table discloses the gross and net amounts of liabilities recognized in the Consolidated Balance Sheets:
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Derivative Financial Instruments, Average Remaining Maturity and the Weighted-Average Interest Rates being Paid and Received | The following table details the derivative financial instruments, the average remaining maturities and the weighted-average interest rates being paid and received by First Financial at September 30, 2016:
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EMPLOYEE BENEFIT PLANS (Tables) |
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Compensation and Retirement Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee Benefit Plan Amounts Recognized in the Consolidated Balance Sheets and Consolidated Statements of Income | The following table sets forth information concerning amounts recognized in First Financial’s Consolidated Statements of Income related to the Company's pension plan:
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EARNINGS PER COMMON SHARE (Tables) |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Computation of Basic and Diluted Earnings Per Share | The following table sets forth the computation of basic and diluted earnings per share:
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FAIR VALUE DISCLOSURES (Tables) |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Estimated Fair Values of Financial Instruments | The estimated fair values of First Financial’s financial instruments not measured at fair value on a recurring or nonrecurring basis in the consolidated financial statements were as follows:
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Summary of Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis | The financial assets and liabilities measured at fair value on a recurring basis in the consolidated financial statements were as follows:
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Summary of Financial Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis | The following table summarizes financial assets and liabilities measured at fair value on a nonrecurring basis.
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BUSINESS COMBINATIONS (Tables) |
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combinations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Purchase price calculation as of the acquisition dates | The following table provides the purchase price calculation as of the acquisition date and the identifiable assets purchased and the liabilities assumed at their estimated fair value:
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INVESTMENTS INVESTMENTS - Additional Information (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
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Gain (Loss) on Investments [Line Items] | ||||
Available-for-sale Securities, Gross Realized Gains (Losses), Sale Proceeds | $ 99,400 | $ 14,700 | $ 206,900 | $ 68,600 |
Available-for-sale Securities, Gross Realized Gains | 800 | 400 | 1,200 | 1,500 |
Available-for-sale Securities, Gross Realized Losses | 500 | 0 | 1,000 | 0 |
Proceeds from Sale of Held-to-maturity Securities | $ 4,862 | $ 0 | 4,862 | $ 0 |
Held-to-maturity Securities, Sold Security, Realized Gain (Loss) | $ 44 |
LOANS AND LEASES LOANS AND LEASES - Carrying Amount of Accretable Yield for Purchased Impaired and Nonimpaired Loans (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
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Receivables [Abstract] | ||||
Balance at beginning of period | $ 56,819 | $ 78,945 | $ 64,857 | $ 106,622 |
Reclassification from/(to) non-accretable difference | 36 | 76 | 3,756 | (2,048) |
Accretion | (3,399) | (4,945) | (11,364) | (17,046) |
Other net activity | (2,022) | (4,746) | (5,815) | (18,198) |
Balance at end of period | $ 51,434 | $ 69,330 | $ 51,434 | $ 69,330 |
LOANS AND LEASES - Changes in Other Real Estate Owned (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
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Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Balance at beginning of period | $ 9,302 | $ 16,401 | $ 12,525 | $ 22,674 |
Additions | 1,239 | 1,583 | 2,418 | 5,955 |
Disposals | (2,736) | (2,560) | (6,908) | (12,238) |
Write-downs | 228 | 237 | 458 | 1,204 |
Balance at end of period | 7,577 | 15,187 | 7,577 | 15,187 |
Commercial | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Additions | 936 | 178 | 1,824 | 2,745 |
Disposals | (2,670) | (852) | (4,763) | (9,394) |
Write-downs | 186 | 183 | 332 | 963 |
Residential - real estate | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Additions | 303 | 1,405 | 594 | 3,210 |
Disposals | (66) | (1,708) | (2,145) | (2,844) |
Write-downs | $ 42 | $ 54 | $ 126 | $ 241 |
LOANS AND LEASES LOANS AND LEASES - Indemnification Asset Rollforward (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
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Receivables [Abstract] | ||||
Balance at beginning of period | $ 14,504 | $ 20,338 | $ 17,630 | $ 22,666 |
Net FDIC claims received / paid | 531 | 758 | 213 | 2,382 |
Amortization | (1,110) | (1,192) | (3,412) | (3,562) |
FDIC loss sharing income | (638) | (973) | (1,144) | (2,323) |
Offset to accelerated discount | 0 | 0 | 0 | (232) |
Balance at end of period | $ 13,287 | $ 18,931 | $ 13,287 | $ 18,931 |
ALLOWANCE FOR LOAN AND LEASE LOSSES - Changes in the Allowance for Loan and Lease Losses for the Current and Comparable Quarter and Year-to-Date (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
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Receivables [Abstract] | ||||
Balance at beginning of period | $ 46,931 | $ 42,128 | $ 43,149 | $ 42,820 |
Provision for loan and lease losses | 1,886 | 1,382 | 7,381 | 6,114 |
Loans charged off | (1,131) | (2,385) | (4,547) | (9,200) |
Recoveries | 1,206 | 1,194 | 2,909 | 2,585 |
Balance at end of period | 48,892 | 42,319 | 48,892 | 42,319 |
Balance at beginning of period | 9,777 | 10,748 | 10,249 | 10,038 |
Provision for loan and lease losses covered | (199) | 1,265 | (2) | 1,663 |
Loans charged-off | (1,419) | (1,577) | (3,147) | (5,078) |
Recoveries | 567 | 577 | 1,626 | 4,390 |
Balance at end of period | 8,726 | 11,013 | 8,726 | 11,013 |
Balance at beginning of period | 56,708 | 52,876 | 53,398 | 52,858 |
Provision for Loan and Lease Losses | 1,687 | 2,647 | 7,379 | 7,777 |
Loans charged-off | (2,550) | (3,962) | (7,694) | (14,278) |
Recoveries | 1,773 | 1,771 | 4,535 | 6,975 |
Balance at end of period | $ 57,618 | $ 53,332 | $ 57,618 | $ 53,332 |
GOODWILL AND OTHER INTANGIBLE ASSETS GOODWILL AND OTHER INTANGIBLE ASSETS-Schedule of Goodwill (Details) - USD ($) $ in Thousands |
9 Months Ended | 12 Months Ended |
---|---|---|
Sep. 30, 2016 |
Dec. 31, 2015 |
|
Goodwill [Roll Forward] | ||
Balance at beginning of year | $ 204,084 | $ 137,739 |
Goodwill | 0 | 66,345 |
Balance at end of period | $ 204,084 | $ 204,084 |
GOODWILL AND OTHER INTANGIBLE ASSETS--Additional Information (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
Dec. 31, 2015 |
|
Finite-Lived Intangible Assets [Line Items] | |||||
Intangible Assets, Net (Excluding Goodwill) | $ 6,800 | $ 6,800 | $ 7,800 | ||
Finite-Lived Core Deposits, Gross | 4,800 | 4,800 | $ 5,900 | ||
Finite-Lived Intangible Assets, Amortization Expense | $ 400 | $ 442 | $ 1,200 | $ 1,300 | |
Core Deposits [Member] | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Intangible assets amortization method | accelerated basis | ||||
Estimated weighted average life (in years) | 5 years |
BORROWINGS Borrowings - - Additional Information (Details) - USD ($) $ in Thousands |
9 Months Ended | ||
---|---|---|---|
Sep. 30, 2016 |
Dec. 31, 2015 |
Sep. 30, 2015 |
|
Debt Disclosure [Abstract] | |||
Federal Home Loan Bank short-term borrowings | $ 848,300 | $ 849,100 | |
Line of Credit Facility, Maximum Borrowing Capacity | 15,000 | ||
Commitments outstanding to extend credit | $ 0 | $ 0 | |
Subordinated debt | $ 120,000 | ||
Subordinated Borrowing, Interest Rate | 5.125% |
BORROWINGS - Schedule of Long-term Debt (Details) - USD ($) $ in Thousands |
Sep. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Amount | ||
Subordinated debt | $ 118,419 | $ 118,312 |
FHLB long-term advances | 355 | 453 |
Capital loan with municipality | 775 | 775 |
Total long-term debt | $ 119,549 | $ 119,540 |
Average Rate [Abstract] | ||
Debt, Weighted Average Interest Rate | 5.19% | 5.20% |
Federal Home Loan Bank | 1.41% | 2.37% |
Weighted average rate on other long-term debt | 0.00% | 0.00% |
Total long-term debt | 5.15% | 5.15% |
ACCUMULATED OTHER COMPREHENSIVE INCOME AMOUNT RECLASSIFIED FROM ACCUMULATED OTHER COMPREHENSIVE INCOME (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
|
Other Accumulated Comprehensive income reclassified from AOCI [Line Items] | ||||
Net gains on sales of investment securities | $ 398 | $ 409 | $ 234 | $ 1,503 |
Defined Benefit Plan, Amortization of Prior Service Cost (Credit) | 103 | 100 | 310 | 300 |
Defined Benefit Plan, Amortization of Gains (Losses) | (420) | (450) | (1,261) | (1,350) |
Other Comprehensive Income, Reclassification, Amortization of Defined Benefit Plans items, Pre-tax | (317) | (350) | (951) | (1,050) |
Total | $ 81 | $ 59 | $ (717) | $ 453 |
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
Dec. 31, 2015 |
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Commitments and Contingencies Disclosure [Line Items] | |||||
Commitments outstanding to extend credit | $ 0 | $ 0 | $ 0 | ||
Letters of credit issued to guarantee performance of a client to a third party | 18,000 | 18,000 | 16,300 | ||
Affordable Housing Program Obligation | 37,300 | 37,300 | 31,500 | ||
Affordable housing contingent commitment | 0 | 0 | 0 | ||
Variable Interest Entity, Nonconsolidated, Carrying Amount, Assets | 1,700 | 1,700 | 1,100 | ||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | 13,800 | 13,800 | 1,100 | ||
Low-income housing tax credit | 600 | $ 400 | 2,000 | $ 1,100 | |
Estimated Litigation Liability | 0 | 0 | 1,300 | ||
Commitments to Extend Credit | |||||
Commitments and Contingencies Disclosure [Line Items] | |||||
Commitments outstanding to extend credit | $ 2,000,000 | $ 2,000,000 | $ 2,000,000 |
INCOME TAXES (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
|
Income Tax Disclosure [Abstract] | ||||
Income tax expense | $ 10,125 | $ 9,202 | $ 31,311 | $ 26,936 |
Effective tax rate | 30.70% | 33.00% | 32.40% | 32.80% |
EMPLOYEE BENEFIT PLANS - Additional Information (Details) - USD ($) |
3 Months Ended | 9 Months Ended | 12 Months Ended | ||
---|---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
Dec. 31, 2015 |
|
Compensation and Retirement Disclosure [Abstract] | |||||
Defined Benefit Plans, Estimated Future Employer Contributions in Current Fiscal Year | $ 0 | ||||
Pension Contributions | 0 | $ 0 | |||
Pension Expense | $ (225,000) | $ (300,000) | $ (675,000) | $ (900,000) |
EMPLOYEE BENEFIT PLANS EMPLOYEE BENEFIT PLANS - Employee benefit plan amounts recognized in the Consolidated Balance Sheets and Consolidated Statements of Income (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
|
Compensation and Retirement Disclosure [Abstract] | ||||
Service cost | $ 1,308 | $ 1,175 | $ 3,925 | $ 3,525 |
Interest cost | 581 | 550 | 1,743 | 1,650 |
Expected return on plan assets | (2,431) | (2,375) | (7,294) | (7,125) |
Amortization of prior service cost | (103) | (100) | (310) | (300) |
Defined Benefit Plan, Amortization of Gains (Losses) | 420 | 450 | 1,261 | 1,350 |
Net periodic benefit cost (income) | $ (225) | $ (300) | $ (675) | $ (900) |
EARNINGS PER COMMON SHARE - Computation of Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
|
Numerator for basic and diluted earnings per share -income available to common shareholders: | ||||
Net income | $ 22,850 | $ 18,673 | $ 65,232 | $ 55,243 |
Denominator for basic earnings per share - weighted average shares | 61,280,283 | 61,135,749 | 61,170,845 | 61,088,794 |
Effect of dilutive securities - | ||||
Employee stock awards | 740,977 | 715,585 | 736,659 | 643,536 |
Warrants | 64,807 | 136,461 | 55,457 | 126,394 |
Denominator for diluted earnings per share - adjusted weighted average shares | 62,086,067 | 61,987,795 | 61,962,961 | 61,858,724 |
Basic | $ 0.37 | $ 0.31 | $ 1.07 | $ 0.90 |
Diluted | $ 0.37 | $ 0.30 | $ 1.05 | $ 0.89 |
EARNINGS PER COMMON SHARE - Additional Information (Details) - $ / shares |
9 Months Ended | |
---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
|
Earnings Per Share Disclosure [Line Items] | ||
Investment Warrants, Exercise Price | $ 12.12 | |
Antidilutive Warrants | ||
Earnings Per Share Disclosure [Line Items] | ||
Stock options and warrants with an exercise price greater than the average market price of the common shares not included in the computation of net income per diluted share | 141,913 | 369,377 |
Antidilutive Stock Options | ||
Earnings Per Share Disclosure [Line Items] | ||
Stock options and warrants with an exercise price greater than the average market price of the common shares not included in the computation of net income per diluted share | 0 | 0 |
FAIR VALUE DISCLOSURES - Summary of Financial Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis (Details) - Fair Value, Measurements, Nonrecurring - USD ($) $ in Thousands |
Sep. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Fair Value Measurements Using Level 1 | ||
Assets | ||
Loans Held-for-sale, Fair Value Disclosure | $ 0 | $ 0 |
Impaired loans | 0 | 0 |
Other Real Estate Owned, Fair Value Disclosure | 0 | 0 |
Fair Value Measurements Using Level 2 | ||
Assets | ||
Loans Held-for-sale, Fair Value Disclosure | 17,414 | 20,957 |
Impaired loans | 0 | 0 |
Other Real Estate Owned, Fair Value Disclosure | 0 | 0 |
Fair Value Measurements Using Level 3 | ||
Assets | ||
Loans Held-for-sale, Fair Value Disclosure | 0 | 0 |
Impaired loans | 7,820 | 8,008 |
Other Real Estate Owned, Fair Value Disclosure | $ 5,149 | $ 7,598 |
BUSINESS COMBINATIONS (Details) - USD ($) $ in Thousands |
9 Months Ended | 12 Months Ended | |
---|---|---|---|
Sep. 30, 2016 |
Dec. 31, 2015 |
Aug. 14, 2015 |
|
Business Acquisition [Line Items] | |||
Goodwill | $ 0 | $ 66,345 | |
Oak Street Holdings Corporation [Domain] | |||
Business Acquisition [Line Items] | |||
Cash consideration | 110,000 | ||
Payoff of long-term borrowings | 197,839 | ||
Total purchase consideration | 307,839 | ||
Cash | $ 2,248 | ||
Loans | 237,377 | ||
Intangible assets | 813 | ||
Other assets | 2,633 | ||
Total assets | 243,071 | ||
Other liabilities | 1,577 | ||
Total liabilities | 1,577 | ||
Net identifiable assets | $ 241,494 | ||
Goodwill | $ 66,345 |
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