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LOANS AND ALLOWANCE FOR LOAN LOSSES (Tables)
 3 Months Ended
Mar. 31, 2019
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, was as follows for the dates indicated:
 
March 31,
2019
 
December 31,
2018
Residential real estate
$
1,017,442

 
$
992,866

Commercial real estate
1,258,474

 
1,269,533

Commercial
390,982

 
381,780

Home equity
323,969

 
327,763

Consumer
20,733

 
20,624

HPFC
30,842

 
33,656

Total loans
$
3,042,442

 
$
3,026,222
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 for the dates indicated:
 
March 31,
2019
 
December 31,
2018
Net unamortized fair value mark discount on acquired loans
$
3,571

 
$
3,936

Net unamortized loan origination costs
(2,157
)
 
(1,865
)
Total
$
1,414

 
$
2,071
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 periods indicated:
 
 
Residential
Real Estate
 
Commercial
Real Estate
 
Commercial
 
Home
Equity
 
Consumer
 
HPFC
 
Total
For The Three Months Ended March 31, 2019
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ALL for the three months ended:
 
 

 
 

 
 

 
 

 
 

 
 
 
 

Beginning balance
 
$
6,071

 
$
11,654

 
$
3,620

 
$
2,796

 
$
234

 
$
337

 
$
24,712

Loans charged off
 
(11
)
 
(65
)
 
(236
)
 
(10
)
 
(14
)
 
—

 
(336
)
Recoveries
 
2

 
4

 
62

 
—

 
7

 
—

 
75

Provision (credit)(1)
 
91

 
245

 
170

 
241

 
32

 
(29
)
 
750

Ending balance
 
$
6,153

 
$
11,838

 
$
3,616

 
$
3,027

 
$
259

 
$
308

 
$
25,201

ALL balance attributable to loans:
 
 

 
 

 
 

 
 

 
 

 
 
 
 

Individually evaluated for impairment
 
$
553

 
$
27

 
$
—

 
$
347

 
$
—

 
$
—

 
$
927

Collectively evaluated for impairment
 
5,600

 
11,811

 
3,616

 
2,680

 
259

 
308

 
24,274

Total ending ALL
 
$
6,153

 
$
11,838

 
$
3,616

 
$
3,027

 
$
259

 
$
308

 
$
25,201

Loans:
 
 

 
 

 
 

 
 

 
 

 
 
 
 

Individually evaluated for impairment
 
$
4,736

 
$
410

 
$
223

 
$
895

 
$
—

 
$
—

 
$
6,264

Collectively evaluated for impairment
 
1,012,706

 
1,258,064

 
390,759

 
323,074

 
20,733

 
30,842

 
3,036,178

Total ending loans balance
 
$
1,017,442

 
$
1,258,474

 
$
390,982

 
$
323,969

 
$
20,733

 
$
30,842

 
$
3,042,442

For The Three Months Ended March 31, 2018
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ALL for the three months ended:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Beginning balance
 
$
5,086

 
$
11,863

 
$
4,171

 
$
2,367

 
$
233

 
$
451

 
$
24,171

Loans charged off
 
(31
)
 
(426
)
 
(171
)
 
(149
)
 
(26
)
 
—

 
(803
)
Recoveries
 
—

 
13

 
63

 
43

 
3

 
—

 
122

Provision (credit)(1)
 
442

 
(1,164
)
 
63

 
166

 
20

 
(27
)
 
(500
)
Ending balance
 
$
5,497

 
$
10,286

 
$
4,126

 
$
2,427

 
$
230

 
$
424

 
$
22,990

ALL balance attributable to loans:
 
 

 
 

 
 

 
 

 
 

 
 
 
 

Individually evaluated for impairment
 
$
553

 
$
368

 
$
—

 
$
112

 
$
—

 
$
—

 
$
1,033

Collectively evaluated for impairment
 
4,944

 
9,918

 
4,126

 
2,315

 
230

 
424

 
21,957

Total ending ALL
 
$
5,497

 
$
10,286

 
$
4,126

 
$
2,427

 
$
230

 
$
424

 
$
22,990

Loans:
 
 

 
 

 
 

 
 

 
 

 
 
 
 

Individually evaluated for impairment
 
$
5,059

 
$
3,961

 
$
1,714

 
$
491

 
$
—

 
$
—

 
$
11,225

Collectively evaluated for impairment
 
855,474

 
1,165,572

 
376,301

 
320,151

 
18,011

 
42,414

 
2,777,923

Total ending loans balance
 
$
860,533

 
$
1,169,533

 
$
378,015

 
$
320,642

 
$
18,011

 
$
42,414

 
$
2,789,148

 
 
Residential
Real Estate
 
Commercial
Real Estate
 
Commercial
 
Home
Equity
 
Consumer
 
HPFC
 
Total
For The Year Ended December 31, 2018
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ALL:
 
 

 
 

 
 

 
 

 
 

 
 
 
 

Beginning balance
 
$
5,086

 
$
11,863

 
$
4,171

 
$
2,367

 
$
233

 
$
451

 
$
24,171

Loans charged off
 
(173
)
 
(512
)
 
(736
)
 
(476
)
 
(96
)
 
(255
)
 
(2,248
)
Recoveries
 
90

 
28

 
1,770

 
44

 
11

 
1

 
1,944

Provision (credit)(1)
 
1,068

 
275

 
(1,585
)
 
861

 
86

 
140

 
845

Ending balance
 
$
6,071

 
$
11,654

 
$
3,620

 
$
2,796

 
$
234

 
$
337

 
$
24,712

ALL balance attributable to loans:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Individually evaluated for impairment
 
$
586

 
$
23

 
$
53

 
$
162

 
$
—

 
$
—

 
$
824

Collectively evaluated for impairment
 
5,485

 
11,631

 
3,567

 
2,634

 
234

 
337

 
23,888

Total ending ALL
 
$
6,071

 
$
11,654

 
$
3,620

 
$
2,796

 
$
234

 
$
337

 
$
24,712

Loans:
 
  

 
  

 
  

 
  

 
  

 
 
 
  

Individually evaluated for impairment
 
$
4,762

 
$
930

 
$
786

 
$
442

 
$
6

 
$
—

 
$
6,926

Collectively evaluated for impairment
 
988,104

 
1,268,603

 
380,994

 
327,321

 
20,618

 
33,656

 
3,019,296

Total ending loans balance
 
$
992,866

 
$
1,269,533

 
$
381,780

 
$
327,763

 
$
20,624

 
$
33,656

 
$
3,026,222


(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 March 31, 2019 and 2018, and December 31, 2018, the reserve for unfunded commitments was $16,000, $23,000 and $22,000, respectively.
Schedule of Provision for Credit Losses
The following reconciles the provision for loan losses to the provision for credit losses as presented on the consolidated statements of income for the periods indicated:
 
 
Three Months Ended 
 March 31,
 
Year Ended December 31,
2018
 
 
2019
 
2018
 
Provision (credit) for loan losses
 
$
750

 
$
(500
)
 
$
845

Change in reserve for unfunded commitments
 
(6
)
 
3

 
2

Provision (credit) for credit losses
 
$
744

 
$
(497
)
 
$
847
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
March 31, 2019
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pass (Grades 1-6)
 
$
1,007,775

 
$
1,237,494

 
$
385,081

 
$
—

 
$
—

 
$
29,519

 
$
2,659,869

Performing
 
—

 
—

 
—

 
321,505

 
20,710

 
—

 
342,215

Special Mention (Grade 7)
 
878

 
5,114

 
2,146

 
—

 
—

 
110

 
8,248

Substandard (Grade 8)
 
8,789

 
15,866

 
3,755

 
—

 
—

 
1,213

 
29,623

Non-performing
 
—

 
—

 
—

 
2,464

 
23

 
—

 
2,487

Total
 
$
1,017,442

 
$
1,258,474

 
$
390,982

 
$
323,969

 
$
20,733

 
$
30,842

 
$
3,042,442

December 31, 2018
 
 

 
 

 
 

 
 

 
 

 
 
 
 
Pass (Grades 1-6)
 
$
983,086

 
$
1,247,190

 
$
374,429

 
$
—

 
$
—

 
$
32,261

 
$
2,636,966

Performing
 
—

 
—

 
—

 
325,917

 
20,595

 
—

 
346,512

Special Mention (Grade 7)
 
887

 
7,921

 
3,688

 
—

 
—

 
123

 
12,619

Substandard (Grade 8)
 
8,893

 
14,422

 
3,663

 
—

 
—

 
1,272

 
28,250

Non-performing
 
—

 
—

 
—

 
1,846

 
29

 
—

 
1,875

Total
 
$
992,866

 
$
1,269,533

 
$
381,780

 
$
327,763

 
$
20,624

 
$
33,656

 
$
3,026,222
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
March 31, 2019
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Residential real estate
$
2,135

 
$
491

 
$
4,269

 
$
6,895

 
$
1,010,547

 
$
1,017,442

 
$
—

 
$
5,415

Commercial real estate
1,387

 
1,885

 
397

 
3,669

 
1,254,805

 
1,258,474

 
—

 
975

Commercial
1,196

 
470

 
324

 
1,990

 
388,992

 
390,982

 
—

 
802

Home equity
1,017

 
192

 
1,788

 
2,997

 
320,972

 
323,969

 
—

 
2,467

Consumer
43

 
362

 
23

 
428

 
20,305

 
20,733

 
14

 
9

HPFC
5

 
182

 
396

 
583

 
30,259

 
30,842

 
—

 
485

Total
$
5,783

 
$
3,582

 
$
7,197

 
$
16,562

 
$
3,025,880

 
$
3,042,442

 
$
14

 
$
10,153

December 31, 2018
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Residential real estate
$
3,300

 
$
2,046

 
$
4,520

 
$
9,866

 
$
983,000

 
$
992,866

 
$
—

 
$
5,492

Commercial real estate
1,794

 
369

 
1,108

 
3,271

 
1,266,262

 
1,269,533

 
—

 
1,380

Commercial
150

 
19

 
799

 
968

 
380,812

 
381,780

 
—

 
1,279

Home equity
907

 
607

 
1,476

 
2,990

 
324,773

 
327,763

 
—

 
1,846

Consumer
67

 
15

 
29

 
111

 
20,513

 
20,624

 
14

 
15

HPFC
—

 
183

 
423

 
606

 
33,050

 
33,656

 
—

 
518

Total
$
6,218

 
$
3,239

 
$
8,355

 
$
17,812

 
$
3,008,410

 
$
3,026,222

 
$
14

 
$
10,530
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
 
 
March 31, 2019
 
December 31, 2018
 
March 31, 2019
 
December 31, 2018
 
March 31, 2019
 
December 31, 2018
Residential real estate
 
25

 
25

 
$
3,594

 
$
3,614

 
$
410

 
$
443

Commercial real estate
 
2

 
2

 
347

 
347

 
27

 
23

Commercial
 
2

 
2

 
138

 
141

 
—

 
—

Home equity
 
2

 
2

 
301

 
304

 
162

 
162

Total
 
31

 
31

 
$
4,380

 
$
4,406

 
$
599

 
$
628
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 periods indicated:
 
 
 
 
 
 
 
For the
Three Months Ended
 
Recorded
Investment
 
Unpaid
Principal
Balance
 
Related
Allowance
 
Average
Recorded
Investment
 
Interest
Income
Recognized
March 31, 2019:
 
 
 
 
 
 
 
 
 
With an allowance recorded:
 

 
 

 
 

 
 

 
 

Residential real estate
$
3,454

 
$
3,454

 
$
553

 
$
3,462

 
$
30

Commercial real estate
131

 
131

 
27

 
131

 
1

Commercial
—

 
—

 
—

 
278

 
—

Home equity
828

 
828

 
347

 
573

 
—

Consumer
—

 
—

 
—

 
—

 
—

HPFC
—

 
—

 
—

 
—

 
—

Ending balance
4,413

 
4,413

 
927

 
4,444

 
31

Without an allowance recorded:
 

 
 

 
 

 
 

 
 

Residential real estate
1,282

 
1,406

 
—

 
1,286

 
10

Commercial real estate
279

 
455

 
—

 
539

 
3

Commercial
223

 
286

 
—

 
226

 
2

Home equity
67

 
265

 
—

 
96

 
—

Consumer
—

 
—

 
—

 
—

 
—

HPFC
—

 
—

 
—

 
—

 
—

Ending balance
1,851

 
2,412

 
—

 
2,147

 
15

Total impaired loans
$
6,264

 
$
6,825

 
$
927

 
$
6,591

 
$
46

March 31, 2018:
 
 
 
 
 
 
 
 
 
With an allowance recorded:
 

 
 

 
 

 
 

 
 

Residential real estate
$
3,544

 
$
3,544

 
$
553

 
$
3,745

 
$
30

Commercial real estate
3,591

 
3,591

 
368

 
4,275

 
1

Commercial
—

 
—

 
—

 
—

 
—

Home equity
147

 
147

 
112

 
49

 
—

Consumer
—

 
—

 
—

 
—

 
—

HPFC
—

 
—

 
—

 
—

 
—

Ending Balance
7,282

 
7,282

 
1,033

 
8,069

 
31

Without an allowance recorded:
 

 
 

 
 

 
 

 
 

Residential real estate
1,515

 
1,791

 
—

 
1,350

 
7

Commercial real estate
370

 
677

 
—

 
637

 
3

Commercial
1,714

 
2,923

 
—

 
1,740

 
2

Home equity
344

 
468

 
—

 
396

 
2

Consumer
—

 
—

 
—

 
—

 
—

HPFC
—

 
—

 
—

 
—

 
—

Ending Balance
3,943

 
5,859

 
—

 
4,123

 
14

Total impaired loans
$
11,225

 
$
13,141

 
$
1,033

 
$
12,192

 
$
45



 
 
 
 
 
 
 
For the
Year Ended
 
Recorded
Investment
 
Unpaid
Principal
Balance
 
Related
Allowance
 
Average
Recorded
Investment
 
Interest
Income
Recognized
December 31, 2018:
 
 
 
 
 
 
 
 
 
With an allowance recorded:
 
 
 

 
 

 
 

 
 

Residential real estate
$
3,471

 
$
3,471

 
$
586

 
$
3,591

 
$
127

Commercial real estate
131

 
131

 
23

 
1,969

 
11

Commercial
556

 
556

 
53

 
111

 
—

Home equity
318

 
318

 
162

 
250

 
—

Consumer
—

 
—

 
—

 
—

 
—

HPFC
—

 
—

 
—

 
—

 
—

Ending Balance
4,476

 
4,476

 
824

 
5,921

 
138

Without an allowance recorded:
  

 
  

 
  

 
  

 
  

Residential real estate
1,291

 
1,415

 
—

 
1,524

 
34

Commercial real estate
799

 
975

 
—

 
2,269

 
13

Commercial
230

 
293

 
—

 
1,379

 
8

Home equity
124

 
305

 
—

 
195

 
—

Consumer
6

 
13

 
—

 
1

 
—

HPFC
—

 
—

 
—

 
—

 
—

Ending Balance
2,450

 
3,001

 
—

 
5,368

 
55

Total impaired loans
$
6,926

 
$
7,477

 
$
824

 
$
11,289

 
$
193