XML 36 R25.htm IDEA: XBRL DOCUMENT v3.8.0.1
LOANS AND ALLOWANCE FOR LOAN LOSSES (Tables)
 9 Months Ended
Sep. 30, 2017
Loans and Leases Receivable Disclosure [Abstract]  
Composition of Loan Portfolio, Excluding Residential Loans Held for Sale
The composition of the Company’s loan portfolio, excluding residential loans held for sale, at September 30, 2017 and December 31, 2016 was as follows:   
 
September 30,
2017
 
December 31,
2016
Residential real estate
$
852,851

 
$
802,494

Commercial real estate
1,131,883

 
1,050,780

Commercial
369,155

 
333,639

Home equity
328,328

 
329,907

Consumer
18,123

 
17,332

HPFC
47,950

 
60,412

Total loans
$
2,748,290

 
$
2,594,564
Schedule of Loan Balances by Portfolio Segment
The loan balances for each portfolio segment presented above are net of their respective unamortized fair value mark discount on acquired loans and net of unamortized loan origination costs totaling:
 
September 30,
2017
 
December 31,
2016
Net unamortized fair value mark discount on acquired loans
$
6,782

 
$
8,810

Net unamortized loan origination costs
(612
)
 
(66
)
Total
$
6,170

 
$
8,744
Summary of Activity in Allowance for Loan Losses
The following presents the activity in the ALL and select loan information by portfolio segment for the three and nine months ended September 30, 2017 and 2016, and for the year ended December 31, 2016: 
 
 
Residential
Real Estate
 
Commercial
Real Estate
 
Commercial
 
Home
Equity
 
Consumer
 
HPFC
 
Total
For The Three and Nine Months Ended September 30, 2017
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ALL for the three months ended:
 
 

 
 

 
 

 
 

 
 

 
 
 
 

Beginning balance
 
$
4,481

 
$
12,848

 
$
4,275

 
$
2,094

 
$
182

 
$
514

 
$
24,394

Loans charged off
 
(238
)
 
(69
)
 
(369
)
 
(11
)
 
(28
)
 
(193
)
 
(908
)
Recoveries
 
26

 
25

 
59

 
1

 
9

 
5

 
125

Provision (credit)(1)
 
273

 
(8
)
 
256

 
93

 
32

 
156

 
802

Ending balance
 
$
4,542

 
$
12,796

 
$
4,221

 
$
2,177

 
$
195

 
$
482

 
$
24,413

ALL for the nine months ended:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Beginning balance
 
$
4,160

 
$
12,154

 
$
3,755

 
$
2,194

 
$
181

 
$
672

 
$
23,116

Loans charged off
 
(433
)
 
(81
)
 
(650
)
 
(403
)
 
(90
)
 
(274
)
 
(1,931
)
Recoveries
 
30

 
138

 
254

 
2

 
13

 
5

 
442

Provision(1)
 
785

 
585

 
862

 
384

 
91

 
79

 
2,786

Ending balance
 
$
4,542

 
$
12,796

 
$
4,221

 
$
2,177

 
$
195

 
$
482

 
$
24,413

ALL balance attributable to loans:
 
 

 
 

 
 

 
 

 
 

 
 
 
 

Individually evaluated for impairment
 
$
464

 
$
1,470

 
$
—

 
$
—

 
$
—

 
$
—

 
$
1,934

Collectively evaluated for impairment
 
4,078

 
11,326

 
4,221

 
2,177

 
195

 
482

 
22,479

Total ending ALL
 
$
4,542

 
$
12,796

 
$
4,221

 
$
2,177

 
$
195

 
$
482

 
$
24,413

Loans:
 
 

 
 

 
 

 
 

 
 

 
 
 
 

Individually evaluated for impairment
 
$
4,792

 
$
6,373

 
$
1,842

 
$
423

 
$
—

 
$
—

 
$
13,430

Collectively evaluated for impairment
 
848,059

 
1,125,510

 
367,313

 
327,905

 
18,123

 
47,950

 
2,734,860

Total ending loans balance
 
$
852,851

 
$
1,131,883

 
$
369,155

 
$
328,328

 
$
18,123

 
$
47,950

 
$
2,748,290

For The Three and Nine Months Ended September 30, 2016
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ALL for the three months ended:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Beginning balance
 
$
4,431

 
$
11,559

 
$
4,558

 
$
2,946

 
$
193

 
$
30

 
$
23,717

Loans charged off
 
—

 
(32
)
 
(1,541
)
 
(44
)
 
(19
)
 
(205
)
 
(1,841
)
Recoveries
 
1

 
7

 
118

 
—

 
1

 
—

 
127

Provision (credit)(1)
 
163

 
1,046

 
148

 
(335
)
 
(13
)
 
278

 
1,287

Ending balance
 
$
4,595

 
$
12,580

 
$
3,283

 
$
2,567

 
$
162

 
$
103

 
$
23,290

ALL for the nine months ended:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Beginning balance
 
$
4,545

 
$
10,432

 
$
3,241

 
$
2,731

 
$
193

 
$
24

 
$
21,166

Loans charged off
 
(229
)
 
(273
)
 
(1,970
)
 
(229
)
 
(60
)
 
(507
)
 
(3,268
)
Recoveries
 
72

 
50

 
252

 
2

 
5

 
—

 
381

Provision(1)
 
207

 
2,371

 
1,760

 
63

 
24

 
586

 
5,011

Ending balance
 
$
4,595

 
$
12,580

 
$
3,283

 
$
2,567

 
$
162

 
$
103

 
$
23,290

ALL balance attributable to loans:
 
 

 
 

 
 

 
 

 
 

 
 
 
 

Individually evaluated for impairment
 
$
511

 
$
1,284

 
$
—

 
$
88

 
$
—

 
$
74

 
$
1,957

Collectively evaluated for impairment
 
4,084

 
11,296

 
3,283

 
2,479

 
162

 
29

 
21,333

Total ending ALL
 
$
4,595

 
$
12,580

 
$
3,283

 
$
2,567

 
$
162

 
$
103

 
$
23,290

Loans:
 
 

 
 

 
 

 
 

 
 

 
 
 
 

Individually evaluated for impairment
 
$
4,551

 
$
13,286

 
$
2,243

 
$
489

 
$
7

 
$
106

 
$
20,682

Collectively evaluated for impairment
 
792,485

 
1,041,021

 
322,179

 
332,606

 
17,409

 
65,627

 
$
2,571,327

Total ending loans balance
 
$
797,036

 
$
1,054,307

 
$
324,422

 
$
333,095

 
$
17,416

 
$
65,733

 
$
2,592,009

 
 
Residential
Real Estate
 
Commercial
Real Estate
 
Commercial
 
Home
Equity
 
Consumer
 
HPFC
 
Total
For The Year Ended December 31, 2016
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ALL:
 
 

 
 

 
 

 
 

 
 

 
 
 
 

Beginning balance
 
$
4,545

 
$
10,432

 
$
3,241

 
$
2,731

 
$
193

 
$
24

 
$
21,166

Loans charged off
 
(356
)
 
(315
)
 
(2,218
)
 
(308
)
 
(101
)
 
(507
)
 
(3,805
)
Recoveries
 
95

 
50

 
332

 
2

 
7

 
—

 
486

Provision (credit)(1)
 
(124
)
 
1,987

 
2,400

 
(231
)
 
82

 
1,155

 
5,269

Ending balance
 
$
4,160

 
$
12,154

 
$
3,755

 
$
2,194

 
$
181

 
$
672

 
$
23,116

ALL balance attributable to loans:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Individually evaluated for impairment
 
$
483

 
$
1,373

 
$
—

 
$
86

 
$
—

 
$
65

 
$
2,007

Collectively evaluated for impairment
 
3,677

 
10,781

 
3,755

 
2,108

 
181

 
607

 
21,109

Total ending ALL
 
$
4,160

 
$
12,154

 
$
3,755

 
$
2,194

 
$
181

 
$
672

 
$
23,116

Loans:
 
  

 
  

 
  

 
  

 
  

 
 
 
  

Individually evaluated for impairment
 
$
4,348

 
$
13,317

 
$
2,028

 
$
457

 
$
7

 
$
97

 
$
20,254

Collectively evaluated for impairment
 
798,146

 
1,037,463

 
331,611

 
329,450

 
17,325

 
60,315

 
2,574,310

Total ending loans balance
 
$
802,494

 
$
1,050,780

 
$
333,639

 
$
329,907

 
$
17,332

 
$
60,412

 
$
2,594,564


(1)
The provision (credit) for loan losses excludes any impact for the change in the reserve for unfunded commitments, which represents management's estimate of the amount required to reflect the probable inherent losses on outstanding letters of credit and unused lines of credit. The reserve for unfunded commitments is presented within accrued interest and other liabilities on the consolidated statements of condition. At September 30, 2017 and 2016, and December 31, 2016, the reserve for unfunded commitments was $22,000, $14,000 and $11,000, respectively.
Schedule of Provision for Credit Losses
The following reconciles the three and nine months ended September 30, 2017 and 2016, and year ended December 31, 2016 provision for loan losses to the provision for credit losses as presented on the consolidated statement of income:
 
 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
 
Year Ended December 31,
2016
 
 
2017
 
2016
 
2017
 
2016
 
Provision for loan losses
 
$
802

 
$
1,287

 
$
2,786

 
$
5,011

 
$
5,269

Change in reserve for unfunded commitments
 
15

 
(8
)
 
11

 
(8
)
 
(11
)
Provision for credit losses
 
$
817

 
$
1,279

 
$
2,797

 
$
5,003

 
$
5,258
Credit Risk Exposure Indicators by Portfolio Segment
The following summarizes credit risk exposure indicators by portfolio segment as of the following dates:
 
 
Residential 
Real Estate
 
Commercial 
Real Estate
 
Commercial
 
Home
Equity
 
Consumer
 
HPFC
 
Total
September 30, 2017
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pass (Grades 1-6)
 
$
841,539

 
$
1,086,856

 
$
361,343

 
$
—

 
$
—

 
$
45,920

 
$
2,335,658

Performing
 
—

 
—

 
—

 
326,702

 
18,123

 
—

 
344,825

Special Mention (Grade 7)
 
933

 
16,663

 
1,770

 
—

 
—

 
209

 
19,575

Substandard (Grade 8)
 
10,379

 
28,364

 
4,645

 
—

 
—

 
1,821

 
45,209

Doubtful (Grade 9)
 
—

 
—

 
1,397

 
—

 
—

 
—

 
1,397

Non-performing
 
—

 
—

 
—

 
1,626

 
—

 
—

 
1,626

Total
 
$
852,851

 
$
1,131,883

 
$
369,155

 
$
328,328

 
$
18,123

 
$
47,950

 
$
2,748,290

December 31, 2016
 
 

 
 

 
 

 
 

 
 

 
 
 
 
Pass (Grades 1-6)
 
$
789,554

 
$
1,003,386

 
$
321,148

 
$
—

 
$
—

 
$
58,943

 
$
2,173,031

Performing
 
—

 
—

 
—

 
328,287

 
17,328

 
—

 
345,615

Special Mention (Grade 7)
 
2,387

 
5,724

 
5,598

 
—

 
—

 
257

 
13,966

Substandard (Grade 8)
 
10,553

 
41,670

 
5,437

 
—

 
—

 
1,212

 
58,872

Doubtful (Grade 9)
 
—

 
—

 
1,456

 
—

 
—

 
—

 
1,456

Non-performing
 
—

 
—

 
—

 
1,620

 
4

 
—

 
1,624

Total
 
$
802,494

 
$
1,050,780

 
$
333,639

 
$
329,907

 
$
17,332

 
$
60,412

 
$
2,594,564
Loan Aging Analysis by Portfolio Segment
The following is a loan aging analysis by portfolio segment (including loans past due over 90 days and non-accrual loans) and a summary of non-accrual loans, which include TDRs, and loans past due over 90 days and accruing as of the following dates:
 
30-59 Days
Past Due
 
60-89 Days
Past Due
 
Greater
than
90 Days
 
Total
Past Due
 
Current
 
Total Loans
Outstanding
 
Loans > 90
Days Past
Due and
Accruing
 
Non-Accrual
Loans
September 30, 2017
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Residential real estate
$
3,308

 
$
157

 
$
3,393

 
$
6,858

 
$
845,993

 
$
852,851

 
$
—

 
$
4,465

Commercial real estate
1,036

 
1,260

 
5,761

 
8,057

 
1,123,826

 
1,131,883

 
—

 
5,887

Commercial
721

 
—

 
1,484

 
2,205

 
366,950

 
369,155

 
—

 
1,830

Home equity
1,022

 
284

 
1,375

 
2,681

 
325,647

 
328,328

 
—

 
1,626

Consumer
29

 
15

 
—

 
44

 
18,079

 
18,123

 
—

 
—

HPFC
646

 
834

 
297

 
1,777

 
46,173

 
47,950

 
—

 
838

Total
$
6,762

 
$
2,550

 
$
12,310

 
$
21,622

 
$
2,726,668

 
$
2,748,290

 
$
—

 
$
14,646

December 31, 2016
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Residential real estate
$
1,783

 
$
924

 
$
2,904

 
$
5,611

 
$
796,883

 
$
802,494

 
$
—

 
$
3,945

Commercial real estate
855

 
223

 
12,625

 
13,703

 
1,037,077

 
1,050,780

 
—

 
12,849

Commercial
633

 
218

 
1,675

 
2,526

 
331,113

 
333,639

 
—

 
2,088

Home equity
892

 
134

 
1,321

 
2,347

 
327,560

 
329,907

 
—

 
1,620

Consumer
38

 
—

 
4

 
42

 
17,290

 
17,332

 
—

 
4

HPFC
438

 
688

 
110

 
1,236

 
59,176

 
60,412

 
—

 
207

Total
$
4,639

 
$
2,187

 
$
18,639

 
$
25,465

 
$
2,569,099

 
$
2,594,564

 
$
—

 
$
20,713
Troubled Debt Restructuring and Specific Reserve Related to TDRs
The following is a summary of TDRs, by portfolio segment, and the associated specific reserve included within the ALL as of the periods indicated:
 
 
Number of Contracts
 
Recorded Investment
 
Specific Reserve
 
 
September 30, 2017
 
December 31, 2016
 
September 30, 2017
 
December 31, 2016
 
September 30, 2017
 
December 31, 2016
Residential real estate
 
25

 
21

 
$
3,728

 
$
3,221

 
$
464

 
$
483

Commercial real estate
 
3

 
3

 
987

 
1,008

 
19

 
—

Commercial
 
8

 
10

 
1,393

 
1,502

 
—

 
—

Home equity
 
2

 
1

 
308

 
16

 
—

 
—

Total
 
38

 
35

 
$
6,416

 
$
5,747

 
$
483

 
$
483
Schedule of Loan Modifications
The following represents loan modifications that qualify as TDRs that occurred for the three and nine months ended September 30, 2017 and 2016:
 
 
Number of Contracts
 
Pre-Modification
Outstanding
Recorded Investment
 
Post-Modification
Outstanding
Recorded Investment
 
Specific Reserve
 
 
2017
 
2016
 
2017
 
2016
 
2017
 
2016
 
2017
 
2016
For the three months ended
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Maturity concession
 
—

 
6

 
$
—

 
$
1,344

 
$
—

 
$
1,652

 
$
—

 
$
—

Residential real estate:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate concession
 
1

 
—

 
134

 
—

 
145

 
—

 
—

 
—

Maturity concession
 
1

 
—

 
147

 
—

 
147

 
—

 
—

 
—

Interest rate and maturity concession
 
1

 
—

 
148

 
—

 
156

 
—

 
29

 
—

Total
 
3

 
6

 
$
429

 
$
1,344

 
$
448

 
$
1,652

 
$
29

 
$
—

For the nine months ended
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Maturity concession
 
—

 
6

 
$
—

 
$
1,344

 
$
—

 
$
1,652

 
$
—

 
$
—

Residential real estate:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate concession
 
1

 
—

 
134

 
—

 
145

 
—

 
—

 
—

Maturity concession
 
2

 
—

 
298

 
—

 
298

 
—

 
15

 
—

Interest rate and maturity concession
 
1

 
—

 
148

 
—

 
156

 
—

 
29

 
—

Home equity:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate and maturity concession
 
1

 
—

 
315

 
—

 
315

 
—

 
—

 
—

Total
 
5

 
6

 
$
895

 
$
1,344

 
$
914

 
$
1,652

 
$
44

 
$
—
Summary of Impaired Loan Balances and Associated Allowance by Portfolio Segment
The following is a summary of impaired loan balances and the associated allowance by portfolio segment as of and for the three and nine months ended September 30, 2017 and 2016, and as of and for the year-ended December 31, 2016:
 
 
 
 
 
 
 
Three Months Ended
 
Nine Months Ended
 
Recorded
Investment
 
Unpaid
Principal
Balance
 
Related
Allowance
 
Average
Recorded
Investment
 
Interest
Income
Recognized(1)
 
Average
Recorded
Investment
 
Interest
Income
Recognized
September 30, 2017:
 
 
 
 
 
 
 
 
 
 
 
 
 
With an allowance recorded:
 

 
 

 
 

 
 

 
 

 
 
 
 
Residential real estate
$
3,262

 
$
3,262

 
$
464

 
$
3,194

 
$
48

 
$
3,084

 
$
103

Commercial real estate
5,589

 
5,589

 
1,470

 
6,590

 
4

 
10,048

 
15

Commercial
—

 
—

 
—

 
82

 
—

 
41

 
—

Home equity
—

 
—

 
—

 
—

 
—

 
167

 
—

Consumer
—

 
—

 
—

 
—

 
—

 
—

 
—

HPFC
—

 
—

 
—

 
—

 
—

 
33

 
—

Ending balance
8,851

 
8,851

 
1,934

 
9,866

 
52

 
13,373

 
118

Without an allowance recorded:
 

 
 

 
 

 
 

 
 

 
 
 
 
Residential real estate
1,530

 
1,949

 
—

 
1,427

 
15

 
1,349

 
15

Commercial real estate
784

 
1,032

 
—

 
794

 
15

 
1,250

 
22

Commercial
1,842

 
3,015

 
—

 
1,891

 
(6
)
 
1,959

 
8

Home equity
423

 
482

 
—

 
440

 
1

 
271

 
6

Consumer
—

 
—

 
—

 
—

 
(4
)
 
3

 
—

HPFC
—

 
—

 
—

 
—

 
—

 
—

 
—

Ending balance
4,579

 
6,478

 
—

 
4,552

 
21

 
4,832

 
51

Total impaired loans
$
13,430

 
$
15,329

 
$
1,934

 
$
14,418

 
$
73

 
$
18,205

 
$
169

September 30, 2016:
 
 
 
 
 
 
 
 
 
 
 
 
 
With an allowance recorded:
 

 
 

 
 

 
 

 
 

 
 
 
 
Residential real estate
$
3,041

 
$
3,041

 
$
511

 
$
3,050

 
$
56

 
$
3,108

 
$
81

Commercial real estate
11,354

 
11,354

 
1,284

 
7,582

 
—

 
3,092

 
—

Commercial
—

 
—

 
—

 
1,782

 
—

 
1,016

 
—

Home equity
302

 
302

 
88

 
303

 
—

 
307

 
—

Consumer
—

 
—

 
—

 
—

 
—

 
—

 
—

HPFC
106

 
106

 
74

 
35

 
—

 
97

 
—

Ending Balance
14,803

 
14,803

 
1,957

 
12,752

 
56

 
7,620

 
81

Without an allowance recorded:
 

 
 

 
 

 
 

 
 

 
 
 
 
Residential real estate
1,510

 
1,996

 
—

 
1,731

 
7

 
2,275

 
7

Commercial real estate
1,932

 
2,427

 
—

 
2,015

 
33

 
2,322

 
37

Commercial
2,243

 
4,667

 
—

 
1,354

 
(11
)
 
2,639

 
12

Home equity
187

 
374

 
—

 
188

 
3

 
181

 
—

Consumer
7

 
10

 
—

 
7

 
4

 
7

 
—

HPFC
—

 
—

 
—

 
—

 
—

 
—

 
—

Ending Balance
5,879

 
9,474

 
—

 
5,295

 
36

 
7,424

 
56

Total impaired loans
$
20,682

 
$
24,277

 
$
1,957

 
$
18,047

 
$
92

 
$
15,044

 
$
137



(1) Negative interest income represents the re-allocation of income between "with an allowance recorded" and "without an allowance recorded" (or vice versa) during the period.
 
 
 
 
 
 
 
Year Ended
 
Recorded
Investment
 
Unpaid
Principal
Balance
 
Related
Allowance
 
Average
Recorded
Investment
 
Interest
Income
Recognized
December 31, 2016:
 
 
 
 
 
 
 
 
 
With an allowance recorded:
 
 
 

 
 

 
 

 
 

Residential real estate
$
3,019

 
$
3,019

 
$
483

 
$
3,088

 
$
106

Commercial real estate
11,443

 
11,443

 
1,373

 
5,165

 
—

Commercial
—

 
—

 
—

 
762

 
—

Home equity
299

 
299

 
86

 
305

 
—

Consumer
—

 
—

 
—

 
—

 
—

HPFC
97

 
97

 
65

 
98

 
—

Ending Balance
14,858

 
14,858

 
2,007

 
9,418

 
106

Without an allowance recorded:
  

 
  

 
  

 
  

 
  

Residential real estate
1,329

 
1,800

 
—

 
2,057

 
9

Commercial real estate
1,874

 
2,369

 
—

 
2,214

 
51

Commercial
2,028

 
3,209

 
—

 
2,507

 
16

Home equity
158

 
368

 
—

 
180

 
—

Consumer
7

 
10

 
—

 
12

 
—

HPFC
—

 
—

 
—

 
—

 
—

Ending Balance
5,396

 
7,756

 
—

 
6,970

 
76

Total impaired loans
$
20,254

 
$
22,614

 
$
2,007

 
$
16,388

 
$
182