10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended June 30, 2017.

or

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

Commission file number: 0-15752

CENTURY BANCORP, INC.

(Exact name of registrant as specified in its charter)

COMMONWEALTH OF MASSACHUSETTS	04-2498617
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
400 MYSTIC AVENUE, MEDFORD, MA	02155
(Address of principal executive offices)	(Zip Code)

(781) 391-4000

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), (2) has been subject to such filing requirements for the past 90 days.    ☒  Yes     ☐  No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    ☒  Yes    ☐  No

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

(Check one):

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐  (Do not check if a smaller reporting company)	Smaller reporting company	☐
Emerging growth company	☐

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

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    ☐  Yes    ☒  No

As of July 31, 2017, the Registrant had outstanding:

Class A Common Stock, $1.00 par value	3,603,729 Shares
Class B Common Stock, $1.00 par value	1,964,180 Shares

Century Bancorp, Inc.

Index

		Page Number
Part I	Financial Information	3
	Forward Looking Statements
Item 1.	Financial Statements (unaudited)
	Consolidated Balance Sheets:	4
	June 30, 2017 and December 31, 2016
	Consolidated Statements of Income:
	Three Months and Six Months	5
	Ended June 30, 2017 and 2016
	Consolidated Statements of Comprehensive Income:
	Three Months and Six Months	6
	Ended June 30, 2017 and 2016
	Consolidated Statements of Changes in Stockholders’ Equity:	7
	Six Months Ended June 30, 2017 and 2016
	Consolidated Statements of Cash Flows:	8
	Six Months Ended June 30, 2017 and 2016
	Notes to Consolidated Financial Statements	9 - 30
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	30 - 42
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	42
Item 4.	Controls and Procedures	42
Part II.	Other Information
Item 1.	Legal Proceedings	43
Item 1A.	Risk Factors	43
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	43
Item 3.	Defaults Upon Senior Securities	43
Item 4.	Mine Safety Disclosures	43
Item 5.	Other Information	43
Item 6.	Exhibits	43
Signatures		44
Exhibits	Ex-31.1
	Ex-31.2
	Ex-32.1
	Ex-32.2
	Ex-101 Instance Document
	Ex-101 Schema Document
	Ex-101 Calculation Linkbase Document
	Ex-101 Labels Linkbase Document
	Ex-101 Presentation Linkbase Document
	Ex-101 Definition Linkbase Document

Forward Looking Statements

Except for the historical information contained herein, this Quarterly Report on Form 10-Q may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 as amended and Section 21E of the Securities Exchange Act of 1934 as amended. Investors are cautioned that forward-looking statements are inherently uncertain. Actual performance and results of operations may differ materially from those projected or suggested in the forward-looking statements due to certain risks and uncertainties, including, without limitation, (i) the fact that the Company’s success is dependent to a significant extent upon general economic conditions in New England, (ii) the fact that the Company’s earnings depend to a great extent upon the level of net interest income (the difference between interest income earned on loans and investments and the interest expense paid on deposits and other borrowings) generated by the Bank and thus the Bank’s results of operations may be adversely affected by increases or decreases in interest rates, (iii) the fact that the banking business is highly competitive and the profitability of the Company depends upon the Bank’s ability to attract loans and deposits within its market area, where the Bank competes with a variety of traditional banking and other institutions such as credit unions and finance companies, and (iv) the fact that a significant portion of the Company’s loan portfolio is comprised of commercial loans, exposing the Company to the risks inherent in loans based upon analyses of credit risk, the value of underlying collateral, including real estate, and other more intangible factors, which are considered in making commercial loans. Accordingly, the Company’s profitability may be negatively impacted by errors in risk analyses, and by loan defaults, and the ability of certain borrowers to repay such loans may be adversely affected by any downturn in general economic conditions. These factors, as well as general economic and market conditions, may materially and adversely affect the market price of shares of the Company’s common stock. Because of these and other factors, past financial performance should not be considered an indicator of future performance. The forward-looking statements contained herein represent the Company’s judgment as of the date of this Form 10-Q, and the Company cautions readers not to place undue reliance on such statements.

Page 3 of 44

PART I - Item 1

Century Bancorp, Inc.

Consolidated Balance Sheets (unaudited)

(In thousands, except share data)

	June 30, 2017			December 31, 2016
Assets
Cash and due from banks	$	74,787		$	62,400
Federal funds sold and interest-bearing deposits in other banks		153,374			173,751
Total cash and cash equivalents		228,161			236,151
Short-term investments		—			3,183
Securities available-for-sale, amortized cost $411,709 and $500,220, respectively		411,340			499,297
Securities held-to-maturity, fair value $1,706,840 and $ 1,635,808, respectively		1,722,875			1,653,986
Federal Home Loan Bank of Boston, stock at cost		25,588			21,042
Loans, net:
Construction and land development		14,159			14,928
Commercial and industrial		650,542			612,503
Municipal		127,259			135,418
Commercial real estate		736,603			696,173
Residential real estate		264,744			241,357
Consumer		10,700			11,013
Home equity		229,274			211,857
Overdrafts		518			684
Total loans, net		2,033,799			1,923,933
Less: allowance for loan losses		25,289			24,406
Net loans		2,008,510			1,899,527
Bank premises and equipment		23,177			23,417
Accrued interest receivable		10,309			9,645
Goodwill		2,714			2,714
Other assets		116,563			113,646
Total assets	$	4,549,237		$	4,462,608
Liabilities
Deposits:
Demand deposits	$	687,219		$	689,286
Savings and NOW deposits		1,409,327			1,304,394
Money market accounts		897,241			1,181,179
Time deposits		575,410			478,359
Total deposits		3,569,197			3,653,218
Securities sold under agreements to repurchase		167,340			182,280
Other borrowed funds		455,500			293,000
Subordinated debentures		36,083			36,083
Due to broker		6,854			—
Other liabilities		59,638			57,986
Total liabilities		4,294,612			4,222,567
Stockholders’ Equity
Preferred Stock – $1.00 par value; 100,000 shares authorized; no shares issued and outstanding		—			—
Common stock, Class A, $1.00 par value per share; authorized 10,000,000 shares; issued 3,603,729 shares and 3,600,729 shares, respectively		3,604			3,601
Common stock, Class B, $1.00 par value per share; authorized 5,000,000 shares; issued 1,964,180 shares and 1,967,180 shares respectively		1,964			1,967
Additional paid-in capital		12,292			12,292
Retained earnings		256,718			243,565
		274,578			261,425
Unrealized losses on securities available-for-sale, net of taxes		(234	)		(567	)
Unrealized losses on securities transferred to held-to-maturity, net of taxes		(3,451	)		(4,084	)
Pension liability, net of taxes		(16,268	)		(16,733	)
Total accumulated other comprehensive loss, net of taxes		(19,953	)		(21,384	)
Total stockholders’ equity		254,625			240,041
Total liabilities and stockholders’ equity	$	4,549,237		$	4,462,608

See accompanying notes to unaudited consolidated interim financial statements.

Page 4 of 44

Century Bancorp, Inc.

Consolidated Statements of Income (unaudited)

(In thousands, except share data)

	Three months ended June 30,				Six months ended June 30,
	2017		2016		2017		2016
Interest income
Loans	$	16,910	$	14,163	$	32,010	$	28,335
Securities held-to-maturity		9,824		8,128		19,359		15,940
Securities available-for-sale		1,723		1,143		3,334		2,107
Federal funds sold and interest-bearing deposits in other banks		349		308		742		623
Total interest income		28,806		23,742		55,445		47,005
Interest expense
Savings and NOW deposits		1,500		938		2,727		1,776
Money market accounts		1,234		781		2,508		1,576
Time deposits		1,902		1,394		3,553		2,752
Securities sold under agreements to repurchase		120		126		223		241
Other borrowed funds and subordinated debentures		1,945		2,247		3,873		4,554
Total interest expense		6,701		5,486		12,884		10,899
Net interest income		22,105		18,256		42,561		36,106
Provision for loan losses		490		350		890		800
Net interest income after provision for loan losses		21,615		17,906		41,671		35,306
Other operating income
Service charges on deposit accounts		2,074		1,962		4,090		3,899
Lockbox fees		861		883		1,632		1,672
Net gains on sales of securities		—		45		—		45
Gains on sales of mortgage loans		269		798		370		798
Other income		1,087		955		2,108		1,883
Total other operating income		4,291		4,643		8,200		8,297
Operating expenses
Salaries and employee benefits		10,719		10,040		21,862		19,816
Occupancy		1,495		1,551		3,236		3,130
Equipment		757		679		1,463		1,315
FDIC assessments		440		592		878		1,160
Other		3,786		3,426		7,483		6,549
Total operating expenses		17,197		16,288		34,922		31,970
Income before income taxes		8,709		6,261		14,949		11,633
Provision for income taxes		552		20		696		84
Net income	$	8,157	$	6,241	$	14,253	$	11,549
Share data:
Weighted average number of shares outstanding, basic
Class A		3,603,729		3,600,729		3,602,229		3,600,729
Class B		1,964,180		1,967,180		1,965,680		1,967,180
Weighted average number of shares outstanding, diluted
Class A		5,567,909		5,567,909		5,567,909		5,567,909
Class B		1,964,180		1,967,180		1,965,680		1,967,180
Basic earnings per share:
Class A	$	1.78	$	1.36	$	3.11	$	2.52
Class B	$	0.89	$	0.68	$	1.55	$	1.26
Diluted earnings per share
Class A	$	1.47	$	1.12	$	2.56	$	2.07
Class B	$	0.89	$	0.68	$	1.55	$	1.26

See accompanying notes to unaudited consolidated interim financial statements.

Page 5 of 44

Century Bancorp, Inc.

Consolidated Statements of Comprehensive Income (unaudited)

(In thousands)

	Three months ended June 30,
	2017		2016
Net income	$	8,157	$	6,241
Other comprehensive income (loss), net of tax:
Unrealized gains (losses) on securities:
Unrealized (losses) gains arising during period		198		(325	)
Less: reclassification adjustment for gains included in net income		—		(27	)
Total unrealized (losses) gains on securities		198		(352	)
Accretion of net unrealized losses transferred		260		762
Defined benefit pension plans:
Amortization of prior service cost and loss included in net periodic benefit cost		233		243
Other comprehensive income		691		653
Comprehensive income	$	8,848	$	6,894
	Six months ended June 30,
	2017		2016
Net income	$	14,253	$	11,549
Other comprehensive income (loss), net of tax:
Unrealized gains (losses) on securities:
Unrealized (losses) gains arising during period		333		(11	)
Less: reclassification adjustment for gains included in net income		—		(27	)
Total unrealized (losses) gains on securities		333		(38	)
Accretion of net unrealized losses transferred		633		1,747
Defined benefit pension plans:
Amortization of prior service cost and loss included in net periodic benefit cost		465		485
Other comprehensive income		1,431		2,194
Comprehensive income	$	15,684	$	13,743

See accompanying notes to unaudited consolidated interim financial statements.

Page 6 of 44

Century Bancorp, Inc.

Consolidated Statements of Changes in Stockholders’ Equity (unaudited)

For the Six Months Ended June 30, 2017 and 2016

	Class A Common Stock		Class B Common Stock			Additional Paid-In Capital		Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Total Stockholders’ Equity
	(In thousands)
Balance at December 31, 2015	$	3,601	$	1,967		$	12,292	$	221,232		$	(24,548	)	$	214,544
Net income		—		—			—		11,549			—			11,549
Other comprehensive income, net of tax:
Unrealized holding (losses) gains arising during period, net of $61 in taxes and $45 in realized gains		—		—			—		—			(38	)		(38	)
Accretion of unrealized losses on securities transferred to held-to-maturity, net of $935 in taxes		—		—			—		—			1,747			1,747
Pension liability adjustment, net of $322 in taxes		—		—			—		—			485			485
Cash dividends paid, Class A common stock, $.24 per share		—		—			—		(866	)		—			(866	)
Cash dividends paid, Class B common stock, $.12 per share		—		—			—		(235	)		—			(235	)
Balance at June 30, 2016	$	3,601	$	1,967		$	12,292	$	231,680		$	(22,354	)	$	227,186
Balance at December 31, 2016	$	3,601	$	1,967		$	12,292	$	243,565		$	(21,384	)	$	240,041
Net income		—		—			—		14,253			—			14,253
Other comprehensive income, net of tax:
Unrealized holding (losses) gains arising during period, net of $221 in taxes		—		—			—		—			333			333
Accretion of unrealized losses on securities transferred to held-to-maturity, net of $690 in taxes		—		—			—		—			633			633
Pension liability adjustment, net of $311 in taxes		—		—			—		—			465			465
Conversion of Class B Common Stock to Class A Common Stock, 3,000 shares		3		(3	)		—		—			—			—
Cash dividends paid, Class A common stock, $.24 per share		—		—			—		(865	)		—			(865	)
Cash dividends paid, Class B common stock, $.12 per share		—		—			—		(235	)		—			(235	)
Balance at June 30, 2017	$	3,604	$	1,964		$	12,292	$	256,718		$	(19,953	)	$	254,625

See accompanying notes to unaudited consolidated interim financial statements.

Page 7 of 44

Century Bancorp, Inc.

Consolidated Statements of Changes in Stockholders’ Equity (unaudited)

For the Six Months Ended June 30, 2017 and 2016

	Six months ended June 30,
	2017			2016
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	14,253		$	11,549
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Gain on sales of mortgage loans		(370	)		(798	)
Net gains on sales of securities		—			(45	)
Provision for loan losses		890			800
Deferred income taxes		(1,579	)		(1,792	)
Net depreciation and amortization		1,660			1,575
Decrease in accrued interest receivable		(664	)		(712	)
Increase in other assets		(2,593	)		(3,428	)
Increase in other liabilities		2,426			1,069
Net cash provided by operating activities		14,023			8,218
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of short-term investments		—			(8	)
Maturities of short-term investments		3,183
Proceeds from redemptions of Federal Home Loan Bank of Boston stock		714			4,898
Purchase of Federal Home Loan Bank of Boston stock		(5,260	)		(2,177	)
Proceeds from calls/maturities of securities available-for-sale		166,976			130,513
Proceeds from sales of securities available-for-sale		—			1,946
Purchase of securities available-for-sale		(71,793	)		(287,834	)
Proceeds from calls/maturities of securities held-to-maturity		153,405			213,337
Proceeds from sales of securities held-to-maturity		—			192
Purchase of securities held-to-maturity		(220,832	)		(345,692	)
Net increase in loans		(136,181	)		(132,182	)
Proceeds from sales of portfolio loans		26,701			50,220
Capital expenditures		(1,365	)		(835	)
Net cash used in investing activities		(84,452	)		(367,622	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase (decrease) in time deposits		97,051			(12,899	)
Net (decrease) increase in demand, savings, money market and NOW deposits		(181,072	)		156,771
Cash dividends		(1,100	)		(1,101	)
Net (decrease) increase in securities sold under agreements to repurchase		(14,940	)		19,915
Net increase in other borrowed funds		162,500			63,000
Net cash provided by financing activities		62,439			225,686
Net decrease in cash and cash equivalents		(7,990	)		(133,718	)
Cash and cash equivalents at beginning of period		236,151			220,724
Cash and cash equivalents at end of period	$	228,161		$	87,006
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest	$	12,997		$	10,893
Income taxes		2,980			2,110
Change in unrealized gains (losses) on securities available-for-sale, net of taxes		333			(38	)
Change in unrealized losses on securities transferred to held-to-maturity, net of taxes		633			1,747
Pension liability adjustment, net of taxes		465			485
Change in due to (from) to broker		6,854			3,180
Transfer of loans to loans held-for-sale		—			12,403

See accompanying notes to unaudited consolidated interim financial statements.

Page 8 of 44

Century Bancorp, Inc.

Notes to Unaudited Consolidated Interim Financial Statements

Six Months Ended June 30, 2017 and 2016

Note 1. Basis of Financial Statement Presentation

The consolidated financial statements include the accounts of Century Bancorp, Inc. (the “Company”) and its wholly owned subsidiary, Century Bank and Trust Company (the “Bank”). The consolidated financial statements also include the accounts of the Bank’s wholly owned subsidiaries, Century Subsidiary Investments, Inc. (“CSII”), Century Subsidiary Investments, Inc. II (“CSII II”), Century Subsidiary Investments, Inc. III (“CSII III”) and Century Financial Services Inc. (“CFSI”). CSII, CSII II, and CSII III are engaged in buying, selling and holding investment securities. CFSI has the power to engage in financial agency, securities brokerage, and investment and financial advisory services and related securities credit. The Company also owns 100% of Century Bancorp Capital Trust II (“CBCT II”). The entity is an unconsolidated subsidiary of the Company.

All significant intercompany accounts and transactions have been eliminated in consolidation. The Company provides a full range of banking services to individual, business and municipal customers in Massachusetts, New Hampshire, Rhode Island, Connecticut, and New York. As a bank holding company, the Company is subject to the regulation and supervision of the Federal Reserve Board. The Bank, a state chartered financial institution, is subject to supervision and regulation by applicable state and federal banking agencies, including the Federal Reserve Board, the Federal Deposit Insurance Corporation (the “FDIC”) and the Commonwealth of Massachusetts Commissioner of Banks. The Bank is also subject to various requirements and restrictions under federal and state law, including requirements to maintain reserves against deposits, restrictions on the types and amounts of loans that may be granted and the interest that may be charged thereon, and limitations on the types of investments that may be made and the types of services that may be offered. Various consumer laws and regulations also affect the operations of the Bank. In addition to the impact of regulation, commercial banks are affected significantly by the actions of the Federal Reserve Board as it attempts to control the money supply and credit availability in order to influence the economy. All aspects of the Company’s business are highly competitive. The Company faces aggressive competition from other lending institutions and from numerous other providers of financial services. The Company has one reportable operating segment.

The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America and general practices within the banking industry. In preparing the financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the balance sheet and revenues and expenses for the period. Actual results could differ from those estimates. The Company’s quarterly report on Form 10-Q should be read in conjunction with the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016, as filed with the Securities and Exchange Commission.

Material estimates that are susceptible to change in the near term relate to the allowance for loan losses. Management believes that the allowance for loan losses is adequate based on independent appraisals and review of other factors, including historical charge-off rates with additional allocations based on risk factors for each category and general economic factors. While management uses available information to recognize loan losses, future additions to the allowance for loan losses may be necessary based on changes in economic conditions. In addition, regulatory agencies periodically review the Company’s allowance for loan losses. Such agencies may require the Company to recognize additions to the allowance for loan losses based on their judgments about information available to them at the time of their examination. Certain reclassifications are made to prior-year amounts whenever necessary to conform with the current-year presentation.

Page 9 of 44

Note 2. Securities Available-for-Sale

	June 30, 2017								December 31, 2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(in thousands)
U.S. Treasury	$	1,999	$	—	$	4	$	1,995	$	2,000	$	—	$	—	$	2,000
U.S. Government Sponsored Enterprises		10,000		—		—		10,000		25,000		—		48		24,952
SBA Backed Securities		71,357		27		195		71,189		57,899		14		146		57,767
U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities		223,655		463		336		223,782		243,703		293		671		243,325
Privately Issued Residential Mortgage-Backed Securities		1,025		3		13		1,015		1,121		2		14		1,109
Obligations Issued by States and Political Subdivisions		98,457		—		408		98,049		165,281		—		405		164,876
Other Debt Securities		5,100		85		193		4,992		5,100		18		194		4,924
Equity Securities		116		202		—		318		116		228		—		344
Total	$	411,709	$	780	$	1,149	$	411,340	$	500,220	$	555	$	1,478	$	499,297

Included in SBA Backed Securities and U.S. Government Sponsored Enterprise Securities and U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities are securities at fair value pledged to secure public deposits and repurchase agreements amounting to $ 173,235,000 and $210,780,000 at June 30, 2017 and December 31, 2016, respectively. Also included in securities available-for-sale are securities at fair value pledged for borrowing at the Federal Home Loan Bank of Boston amounting to $49,416,000 and $53,396,000 at June 30, 2017 and December 31, 2016, respectively. There were no sales of available-for-sale securities for the six months ended June 30, 2017. The Company realized gross gains of $33,000 from the proceeds of $1,946,000 from the sales of available-for-sales securities for the six months ended June 30, 2016.

Debt securities of U.S. Government Sponsored Enterprises and U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities primarily refer to debt securities of Fannie Mae and Freddie Mac.

The following table shows the maturity distribution of the Company’s securities available-for-sale at June 30, 2017.

	Amortized Cost		Fair Value
	(in thousands)
Within one year	$	90,264	$	90,255
After one but within five years		132,716		132,786
After five but within ten years		105,344		105,360
More than 10 years		81,769		81,270
Non-maturing		1,616		1,669
Total	$	411,709	$	411,340

The weighted average remaining life of investment securities available-for-sale at June 30, 2017 was 5.4 years. Included in the weighted average remaining life calculation at June 30, 2017 were $10,000,000 of U.S. Government Sponsored Enterprises obligations that are callable at the discretion of the issuer. The contractual maturities, which were used in the table above, of mortgage-backed securities, will differ from the actual maturities, due to the ability of the issuers to prepay underlying obligations.

Page 10 of 44

As of June 30, 2017 and December 31, 2016, management concluded that the unrealized losses of its investment securities are temporary in nature since they are not related to the underlying credit quality of the issuers, and the Company does not intend to sell these debt securities and it is not more likely than not that it will be required to sell these debt securities before the anticipated recovery of its remaining amortized cost. In making its other-than-temporary impairment evaluation, the Company considered that the principal and interest on these securities are from issuers that are investment grade.

The unrealized loss on SBA Backed Securities, U.S. Government Agency and Sponsored Enterprise Mortgage Backed Securities, Obligations Issued by States and Political Subdivisions, and Other Debt Securities, related primarily to interest rates and not credit quality, and because the Company has the ability and intent to hold these investments until recovery of fair value, which may be maturity, the Company does not consider these investments to be other-than-temporarily impaired.

In evaluating the underlying credit quality of a security, management considers several factors such as the credit rating of the obligor and the issuer, if applicable. Internal reviews of issuer financial statements are performed as deemed necessary. In the case of privately issued mortgage-backed securities, the performance of the underlying loans is analyzed as deemed necessary to determine the estimated future cash flows of the securities. Factors considered include the level of subordination, current and estimated future default rates, current and estimated prepayment rates, estimated loss severity rates, geographic concentrations and origination dates of underlying loans. In the case of marketable equity securities, the severity of the unrealized loss, the length of time the unrealized loss has existed, and the issuer’s financial performance are considered.

The following table shows the temporarily impaired securities of the Company’s available-for-sale portfolio at June 30, 2017. This table shows the unrealized market loss of securities that have been in a continuous unrealized loss position for less than 12 months and a continuous loss position for 12 months or longer. There are 13 and 27 securities that are temporarily impaired for less than 12 months and for 12 months or longer, respectively, out of a total of 269 holdings at June 30, 2017.

	June 30, 2017
	Less than 12 months				12 months or longer				Total
Temporarily Impaired Investments	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(in thousands)
U.S. Treasury	$	1,995	$	4	$	—	$	—	$	1,995	$	4
U.S. Government Sponsored Enterprises		—		—		—		—		—		—
SBA Backed Securities		27,850		116		17,775		79		45,625		195
U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities		36,251		83		66,121		253		102,372		336
Privately Issued Residential Mortgage-Backed Securities		—		—		707		13		707		13
Obligations Issued by States and Political Subdivisions		—		—		4,297		408		4,297		408
Other Debt Securities		—		—		1,907		193		1,907		193
Total temporarily impaired securities	$	66,096	$	203	$	90,807	$	946	$	156,903	$	1,149

Page 11 of 44

The following table shows the temporarily impaired securities of the Company’s available-for-sale portfolio at December 31, 2016. This table shows the unrealized market loss of securities that have been in a continuous unrealized loss position for less than 12 months and a continuous loss position for 12 months or longer. There are 49 and 15 securities that are temporarily impaired for less than 12 months and for 12 months or longer, respectively, out of a total of 270 holdings at December 31, 2016.

Temporarily Impaired Investments	December 31, 2016
	Less than 12 months				12 months or longer				Total
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(in thousands)
U.S. Government Sponsored Enterprises	$	24,952	$	48	$	—	$	—	$	24,952	$	48
SBA Backed Securities		52,346		145		951		1		53,297		146
U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities		135,612		485		31,504		186		167,116		671
Privately Issued Residential Mortgage-Backed Securities		—		—		757		14		757		14
Obligations Issued by States and Political Subdivisions		—		—		4,298		405		4,298		405
Other Debt Securities		453		47		1,553		147		2,006		194
Total temporarily impaired securities	$	213,363	$	725	$	39,063	$	753	$	252,426	$	1,478

Note 3. Investment Securities Held-to-Maturity

	June 30, 2017								December 31, 2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
	(in thousands)
U.S. Government Sponsored Enterprises	$	134,378	$	931	$	287	$	135,022	$	148,326	$	1,066	$	527	$	148,865
SBA Backed Securities		54,427		3		779		53,651		46,140		—		1,088		45,052
U.S. Government Agency and Sponsored Enterprises Mortgage-Backed Securities		1,534,070		5,419		21,322		1,518,167		1,459,520		4,948		22,577		1,441,891
Total	$	1,722,875	$	6,353	$	22,388	$	1,706,840	$	1,653,986	$	6,014	$	24,192	$	1,635,808

Included in U.S. Government and Agency Securities are securities pledged to secure public deposits and repurchase agreements at fair value amounting to $1,268,349,000 and $1,147,207,000 at June 30, 2017 and December 31, 2016, respectively. Also included are securities pledged for borrowing at the Federal Home Loan Bank of Boston at fair value amounting to $305,269,000 and $424,353,000 at June 30, 2017 and December 31, 2016, respectively. There were no sales of held-to-maturity securities for the six months ended June 30, 2017. The Company realized gross gains of $12,000 from the proceeds of $192,000 from the sales of securities held-to-maturity for the six months ended June 30, 2016. The sales of securities held-to-maturity relate to certain mortgage backed securities for which the Company had previously collected a substantial portion of its principal investment.

At June 30, 2017 and December 31, 2016, all mortgage-backed securities are obligations of U.S. Government Agencies and Government Sponsored Enterprises. Debt securities of U.S. Government Sponsored Enterprises and U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities primarily refer to debt securities of Fannie Mae and Freddie Mac.

Page 12 of 44

The following table shows the maturity distribution of the Company’s securities held-to-maturity at June 30, 2017.

	Amortized Cost		Fair Value
	(in thousands)
Within one year	$	45,780	$	45,827
After one but within five years		1,224,104		1,213,863
After five but within ten years		449,698		444,027
More than ten years		3,293		3,123
Total	$	1,722,875	$	1,706,840

The weighted average remaining life of investment securities held-to-maturity at June 30, 2017 was 4.4 years. Included in the weighted average remaining life calculation at June 30, 2017 were $35,496,000 of U.S. Government Sponsored Enterprises obligations that are callable at the discretion of the issuer. The actual maturities, which were used in the table above, of mortgage-backed securities, will differ from the contractual maturities, due to the ability of the issuers to prepay underlying obligations.

As of June 30, 2017 and December 31, 2016, management concluded that the unrealized losses of its investment securities are temporary in nature since they are not related to the underlying credit quality of the issuers, and the Company does not intend to sell these debt securities and it is not likely that it will be required to sell these debt securities before the anticipated recovery of their remaining amortized costs. In making its other-than-temporary impairment evaluation, the Company considered the fact that the principal and interest on these securities are from issuers that are investment grade.

The unrealized loss on U.S. Government Sponsored Enterprises, SBA Backed Securities, and U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities related primarily to interest rates and not credit quality, and because the Company does not intend to sell any of these securities and it is not likely that it will be required to sell these securities before the anticipated recovery of the remaining amortized cost, the Company does not consider these investments to be other-than-temporarily impaired June 30, 2017 and December 31, 2016.

In evaluating the underlying credit quality of a security, management considers several factors such as the credit rating of the obligor and the issuer, if applicable. Internal reviews of issuer financial statements are performed as deemed necessary.

The following table shows the temporarily impaired securities of the Company’s held-to-maturity portfolio at June 30, 2017. This table shows the unrealized market loss of securities that have been in a continuous unrealized loss position for 12 months or less and a continuous loss position for 12 months or longer. There are 190 and 22 securities that are temporarily impaired for less than 12 months and for 12 months or longer, respectively, out of a total of 393 holdings at June 30, 2017.

	June 30, 2017
	Less Than 12 Months				12 Months or Longer				Total
Temporarily Impaired Investments	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(in thousands)
U.S. Government Sponsored Enterprises	$	45,209	$	287	$	—	$	—	$	45,209	$	287
SBA Backed Securities		50,633		779		—		—		50,633		779
U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities		1,015,890		18,964		76,584		2,358		1,092,474		21,322
Total temporarily impaired securities	$	1,111,732	$	20,030	$	76,584	$	2,358	$	1,188,316	$	22,388

Page 13 of 44

The following table shows the temporarily impaired securities of the Company’s held-to-maturity portfolio at December 31, 2016. This table shows the unrealized market loss of securities that have been in a continuous unrealized loss position for less than 12 months and a continuous loss position for 12 months or longer. There are 194 and 16 securities that are temporarily impaired for less than 12 months and for 12 months or longer, respectively, out of a total of 375 holdings at December 31, 2016.

	December 31, 2016
	Less Than 12 Months				12 Months or Longer				Total
Temporarily Impaired Investments	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(in thousands)
U.S. Government Sponsored Enterprises	$	59,219	$	527	$	—	$	—	$	59,219	$	527
SBA Backed Securities		45,052		1,088		—		—		45,052		1,088
U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities		1,008,960		20,725		58,535		1,852		1,067,495		22,577
Total temporarily impaired securities	$	1,113,231	$	22,340	$	58,535	$	1,852	$	1,171,766	$	24,192

Note 4. Allowance for Loan Losses

The Company maintains an allowance for loan losses in an amount determined by management on the basis of the character of the loans, loan performance, financial condition of borrowers, the value of collateral securing loans and other relevant factors.

The following table summarizes the changes in the Company’s allowance for loan losses for the periods indicated.

	Three months ended June 30,						Six months ended June 30,
	2017			2016			2017			2016
	(in thousands)
Allowance for loan losses, beginning of period	$	24,827		$	23,544		$	24,406		$	23,075
Adjustment		—			(84	)		—			(84	)
Loans charged off		(100	)		(111	)		(197	)		(180	)
Recoveries on loans previously charged-off		72			164			190			252
Net (charge-offs) / recoveries		(28	)		53			(7	)		72
Provision charged to expense		490			350			890			800
Allowance for loan losses, end of period	$	25,289		$	23,863		$	25,289		$	23,863

Page 14 of 44

Further information pertaining to the allowance for loan losses for the three months ending June 30, 2017 follows:

	Construction and Land Development		Commercial and Industrial			Municipal			Commercial Real Estate			Residential Real Estate		Consumer			Home Equity		Unallocated			Total
	(in thousands)
Allowance for loan losses:
Balance at March 31, 2017	$	873	$	7,369		$	1,899		$	11,216		$	1,671	$	452		$	1,050	$	297		$	24,827
Charge-offs		—		(29	)		—			—			—		(71	)		—		—			(100	)
Recoveries		—		34			—			—			—		38			—		—			72
Provision		264		189			(40	)		(188	)		447		(224	)		96		(54	)		490
Ending balance at June 30, 2017	$	1,137	$	7,563		$	1,859		$	11,028		$	2,118	$	195		$	1,146	$	243		$	25,289
Amount of allowance for loan losses for loans deemed to be impaired	$	—	$	11		$	—		$	120		$	69	$	—		$	—	$	—		$	200
Amount of allowance for loan losses for loans not deemed to be impaired	$	1,137	$	7,552		$	1,859		$	10,908		$	2,049	$	195		$	1,146	$	243		$	25,089
Loans:
Ending balance	$	14,159	$	650,542		$	127,259		$	736,603		$	264,744	$	11,218		$	229,274	$	—		$	2,033,799
Loans deemed to be impaired	$	—	$	365		$	—		$	2,603		$	4,343	$	—		$	—	$	—		$	7,311
Loans not deemed to be impaired	$	14,159	$	650,177		$	127,259		$	734,000		$	260,401	$	11,218		$	229,274	$	—		$	2,026,488

Further information pertaining to the allowance for loan losses for the six months ending June 30, 2017 follows:

	Construction and Land Development		Commercial and Industrial			Municipal		Commercial Real Estate			Residential Real Estate		Consumer			Home Equity		Unallocated			Total
	(in thousands)
Allowance for loan losses:
Balance at December 31, 2016	$	1,012	$	6,972		$	1,612	$	11,135		$	1,698	$	582		$	1,102	$	293		$	24,406
Charge-offs		—		(29	)		—		—			—		(168	)		—		—			(197	)
Recoveries		—		54			—		—			2		134			—		—			190
Provision		125		566			247		(107	)		418		(353	)		44		(50	)		890
Ending balance at June 30, 2017	$	1,137	$	7,563		$	1,859	$	11,028		$	2,118	$	195		$	1,146	$	243		$	25,289
Amount of allowance for loan losses for loans deemed to be impaired	$	—	$	11		$	—	$	120		$	69	$	—		$	—	$	—		$	200
Amount of allowance for loan losses for loans not deemed to be impaired	$	1,137	$	7,552		$	1,859	$	10,908		$	2,049	$	195		$	1,146	$	243		$	25,089
Loans:
Ending balance	$	14,159	$	650,542		$	127,259	$	736,603		$	264,744	$	11,218		$	229,274	$	—		$	2,033,799
Loans deemed to be impaired	$	—	$	365		$	—	$	2,603		$	4,343	$	—		$	—	$	—		$	7,311
Loans not deemed to be impaired	$	14,159	$	650,177		$	127,259	$	734,000		$	260,401	$	11,218		$	229,274	$	—		$	2,026,488

During the six months ending June 30, 2017, the Company’s provision was primarily attributable to an increase in commercial and industrial and residential real estate balances offset, somewhat, by changes in historical loss and qualitative factors. During the three months ending June 30, 2017 the Company’s provision was primarily attributable to an increase in residential real estate loan balances offset, somewhat, by changes in historical loss and qualitative factors. There was also an increase in commercial and industrial originations, which increased the commercial and industrial allocation and lower historical loss rate, which decreased the consumer allocations.

Page 15 of 44

Further information pertaining to the allowance for loan losses for the three months ending June 30, 2016 follows:

	Construction and Land Development			Commercial and Industrial			Municipal		Commercial Real Estate			Residential Real Estate			Consumer			Home Equity			Unallocated		Total
	(in thousands)
Allowance for loan losses:
Balance at March 31, 2016	$	1,973		$	6,693		$	990	$	10,533		$	1,249		$	693		$	1,185		$	228	$	23,544
Charge-offs		—			—			—		—			—			(111	)		—			—		(111	)
Recoveries		—			56			—		—			2			106			—			—		164
Provision		264			(878	)		811		128			53			(77	)		9			40		350
Reclassification to other liabilities		(3	)		(29	)		—		(11	)		(2	)		(3	)		(36	)		—		(84	)
Ending balance at June 30, 2016	$	2,234		$	5,842		$	1,801	$	10,650		$	1,302		$	608		$	1,158		$	268	$	23,863
Amount of allowance for loan losses for loans deemed to be impaired	$	6		$	10		$	—	$	151		$	7		$	—		$	—		$	—	$	174
Amount of allowance for loan losses for loans not deemed to be impaired	$	2,228		$	5,832		$	1,801	$	10,499		$	1,295		$	608		$	1,158		$	268	$	23,689
Loans:
Ending balance	$	31,178		$	493,033		$	134,386	$	728,658		$	219,494		$	11,339		$	183,816		$	—	$	1,801,904
Loans deemed to be impaired	$	96		$	410		$	—	$	3,736		$	215		$	—		$	—		$	—	$	4,457
Loans not deemed to be impaired	$	31,082		$	492,623		$	134,386	$	724,922		$	219,279		$	11,339		$	183,816		$	—	$	1,797,447

Further information pertaining to the allowance for loan losses for the six months ending June 30, 2016 follows:

	Construction and Land Development			Commercial and Industrial			Municipal		Commercial Real Estate			Residential Real Estate			Consumer			Home Equity			Unallocated			Total
	(in thousands)
Allowance for loan losses:
Balance at December 31, 2015	$	2,041		$	5,899		$	994	$	10,589		$	1,320		$	644		$	1,077		$	511		$	23,075
Charge-offs		—			—			—		—			—			(180	)		—			—			(180	)
Recoveries		—			91			—		—			3			158			—			—			252
Provision		196			(119	)		807		72			(19	)		(11	)		117			(243	)		800
Reclassification to other liabilities		(3	)		(29	)		—		(11	)		(2	)		(3	)		(36	)		—			(84	)
Ending balance at June 30, 2016	$	2,234		$	5,842		$	1,801	$	10,650		$	1,302		$	608		$	1,158		$	268		$	23,863
Amount of allowance for loan losses for loans deemed to be impaired	$	6		$	10		$	—	$	151		$	7		$	—		$	—		$	—		$	174
Amount of allowance for loan losses for loans not deemed to be impaired	$	2,228		$	5,832		$	1,801	$	10,499		$	1,295		$	608		$	1,158		$	268		$	23,689
Loans:
Ending balance	$	31,178		$	493,033		$	134,386	$	728,658		$	219,494		$	11,339		$	183,816		$	—		$	1,801,904
Loans deemed to be impaired	$	96		$	410		$	—	$	3,736		$	215		$	—		$	—		$	—		$	4,457
Loans not deemed to be impaired	$	31,082		$	492,623		$	134,386	$	724,922		$	219,279		$	11,339		$	183,816		$	—		$	1,797,447

During the six months ending June 30, 2016, the Company’s provision was primarily attributable to an increase in municipal balances. During the three months ending June 30, 2016 the Company’s provision was primarily attributable to an increase in construction loan balances. There was also an increase in municipal originations, which increased the municipal allocation and commercial and industrial loan payoffs, which decreased the commercial and industrial allocations.

Page 16 of 44

The Company utilizes a six grade internal loan rating system for commercial real estate, construction and commercial loans as follows:

Loans rated 1-3 (Pass):

Loans in this category are considered “pass” rated loans with low to average risk.

Loans rated 4 (Monitor):

These loans represent classified loans that management is closely monitoring for credit quality. These loans have had or may have minor credit quality deterioration as of June 30, 2017 and December 31, 2016.

Loans rated 5 (Substandard):

Substandard loans represent classified loans that management is closely monitoring for credit quality. These loans have had more significant credit quality deterioration as of June 30, 2017 and December 31, 2016.

Loans rated 6 (Doubtful):

Doubtful loans represent classified loans that management is closely monitoring for credit quality. These loans had more significant credit quality deterioration as of June 30, 2017 and December 31, 2016 and are doubtful for full collection.

Impaired:

Impaired loans represent classified loans that management is closely monitoring for credit quality. A loan is classified as impaired when it is probable that the Company will be unable to collect all amounts due.

The following table presents the Company’s loans by risk rating at June 30, 2017.

	Construction and Land Development		Commercial and Industrial		Municipal		Commercial Real Estate
	(in thousands)
Grade:
1-3 (Pass)	$	14,159	$	650,177	$	127,259	$	704,531
4 (Monitor)		—		—		—		29,469
5 (Substandard)		—		—		—		—
6 (Doubtful)		—		—		—		—
Impaired		—		365		—		2,603
Total	$	14,159	$	650,542	$	127,259	$	736,603

The following table presents the Company’s loans by risk rating at December 31, 2016.

	Construction and Land Development		Commercial and Industrial		Municipal		Commercial Real Estate
	(in thousands)
Grade:
1-3 (Pass)	$	14,834	$	612,114	$	135,418	$	661,271
4 (Monitor)		—		—		—		31,753
5 (Substandard)		—		—		—		—
6 (Doubtful)		—		—		—		—
Impaired		94		389		—		3,149
Total	$	14,928	$	612,503	$	135,418	$	696,173

Page 17 of 44

The Company has increased its exposure to larger loans to large institutions with publically available credit ratings beginning in 2015. These ratings are tracked as a credit quality indicator for these loans. Credit ratings issued by national organizations were utilized as credit quality indicators as presented in the following table at June 30, 2017 and are included within the total loan portfolio.

	Commercial and Industrial		Municipal		Commercial Real Estate		Total
	(in thousands)
Credit Rating:
Aaa – Aa3	$	341,777	$	66,484	$	45,615	$	453,876
A1 – A3		218,222		8,225		128,927		355,374
Baa1 – Baa3		—		46,970		125,775		172,745
Ba2		—		2,730		—		2,730
Total	$	559,999	$	124,409	$	300,317	$	984,725

Credit ratings issued by national organizations were utilized as credit quality indicators as presented in the following table at December 31, 2016.

	Commercial and Industrial		Municipal		Commercial Real Estate		Total
	(in thousands)
Credit Rating:
Aaa – Aa3	$	334,674	$	66,245	$	6,596	$	407,515
A1 – A3		188,777		33,365		129,423		351,565
Baa1 – Baa3		—		26,970		127,366		154,336
Ba2		—		3,610		—		3,610
Total	$	523,451	$	130,190	$	263,385	$	917,026

The Company utilized payment performance as credit quality indicators for the loan types listed below. The indicators are depicted in the table “aging of past due loans,” below.

Further information pertaining to the allowance for loan losses at June 30, 2017 follows:

	Accruing 30-89 Days Past Due		Non Accrual		Accruing Greater than 90 Days		Total Past Due		Current Loans		Total
	(in thousands)
Construction and land development	$	—	$	—	$	—	$	—	$	14,159	$	14,159
Commercial and industrial		404		49		—		453		650,089		650,542
Municipal		—		—		—		—		127,259		127,259
Commercial real estate		455		230		—		685		735,918		736,603
Residential real estate		984		735		—		1,719		263,025		264,744
Consumer and overdrafts		6		1		—		7		11,211		11,218
Home equity		1,357		107		—		1,464		227,810		229,274
Total	$	3,206	$	1,122	$	—	$	4,328	$	2,029,471	$	2,033,799

Page 18 of 44

Further information pertaining to the allowance for loan losses at December 31, 2016 follows:

	Accruing 30-89 Days Past Due		Non Accrual		Accruing Greater than 90 Days		Total Past Due		Current Loans		Total
	(in thousands)
Construction and land development	$	—	$	94	$	—	$	94	$	14,834	$	14,928
Commercial and industrial		37		65		—		102		612,401		612,503
Municipal		—		—		—		—		135,418		135,418
Commercial real estate		597		150		—		747		695,426		696,173
Residential real estate		245		656		—		901		240,456		241,357
Consumer and overdrafts		—		11		—		11		11,686		11,697
Home equity		735		108		—		843		211,014		211,857
Total	$	1,614	$	1,084	$	—	$	2,698	$	1,921,235	$	1,923,933

A loan is impaired when, based on current information and events, it is probable that a creditor will be unable to collect all amounts due according to the contractual terms of the loan agreement. When a loan is impaired, the Company measures impairment based on the present value of expected future cash flows discounted at the loan’s effective interest rate, except that as a practical expedient, the Company measures impairment based on a loan’s observable market price or the fair value of the collateral if the loan is collateral dependent. Loans are charged-off when management believes that the collectability of the loan’s principal is not probable. The specific factors that management considers in making the determination that the collectability of the loan’s principal is not probable include: the delinquency status of the loan, the fair value of the collateral, if secured, and the financial strength of the borrower and/or guarantors. For collateral dependent loans, the amount of the recorded investment in a loan that exceeds the fair value of the collateral is charged-off against the allowance for loan losses in lieu of an allocation of a specific allowance amount when such an amount has been identified definitively as uncollectible. The Company’s policy for recognizing interest income on impaired loans is contained within Note 1 of the consolidated financial statements contained in the Company’s Annual Report for the fiscal year ended December 31, 2016.

Page 19 of 44

The following is information pertaining to impaired loans for June 30, 2017:

	Carrying Value		Unpaid Principal Balance		Required Reserve		Average Carrying Value for 3 Months Ending 6/30/17		Interest Income Recognized for 3 Months Ending 6/30/17		Average Carrying Value for 6 Months Ending 6/30/17		Interest Income Recognized for 6 Months Ending 6/30/17
	(in thousands)
With no required reserve recorded:
Construction and land development	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial and industrial		49		248		—		43		—		43		—
Municipal		—		—		—		—		—		—		—
Commercial real estate		—		—		—		294		—		421		—
Residential real estate		79		169		—		81		2		84		3
Consumer		—		—		—		—		—		—		—
Home equity		—		—		—		—		—		—		—
Total	$	128	$	417	$	—	$	418	$	2	$	548	$	3
With required reserve recorded:
Construction and land development	$	—	$	—	$	—	$	69	$	—	$	80	$	—
Commercial and industrial		316		331		11		326		4		332		8
Municipal		—		—		—		—		—		—		—
Commercial real estate		2,603		2,728		120		2,546		24		2,548		48
Residential real estate		4,264		4,265		69		1,145		24		701		25
Consumer		—		—		—		—		—		—		—
Home equity		—		—		—		—		—		—		—
Total	$	7,183	$	7,324	$	200	$	4,086	$	52	$	3,661	$	81
Total:
Construction and land development	$	—	$	—	$	—	$	69	$	—	$	80	$	—
Commercial and industrial		365		579		11		369		4		375		8
Municipal		—		—		—		—		—		—		—
Commercial real estate		2,603		2,728		120		2,840		24		2,969		48
Residential real estate		4,343		4,434		69		1,226		26		785		28
Consumer		—		—		—		—		—		—		—
Home equity		—		—		—		—		—		—		—
Total	$	7,311	$	7,741	$	200	$	4,504	$	54	$	4,209	$	84

Page 20 of 44

The following is information pertaining to impaired loans for June 30, 2016:

	Carrying Value		Unpaid Principal Balance		Required Reserve		Average Carrying Value for 3 Months Ending 6/30/16		Interest Income Recognized for 3 Months Ending 6/30/16		Average Carrying Value for 6 Months Ending 6/30/16		Interest Income Recognized for 6 Months Ending 6/30/16
	(in thousands)
With no required reserve recorded:
Construction and land development	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial and industrial		52		239		—		54		—		56		—
Municipal		—		—		—		—		—		—		—
Commercial real estate		596		596		—		329		16		188		22
Residential real estate		103		190		—		106		2		108		4
Consumer		—		—		—		—		—		—		—
Home equity		—		—		—		—		—		—		—
Total	$	751	$	1,025	$	—	$	489	$	18	$	352	$	26
With required reserve recorded:
Construction and land development	$	96	$	108	$	6	$	97	$	—	$	97	$	—
Commercial and industrial		358		373		10		370		5		374		9
Municipal		—		—		—		—		—		—		—
Commercial real estate		3,140		3,239		151		2,030		20		1,878		33
Residential real estate		112		112		7		283		1		505		3
Consumer		—		—		—		—		—		—		—
Home equity		—		—		—		22		—		51		—
Total	$	3,706	$	3,832	$	174	$	2,802	$	26	$	2,905	$	45
Total:
Construction and land development	$	96	$	108	$	6	$	97	$	—	$	97	$	—
Commercial and industrial		410		612		10		424		5		430		9
Municipal		—		—		—		—		—		—		—
Commercial real estate		3,736		3,835		151		2,359		36		2,066		55
Residential real estate		215		302		7		389		3		613		7
Consumer		—		—		—		—		—		—		—
Home equity		—		—		—		22		—		51		—
Total	$	4,457	$	4,857	$	174	$	3,291	$	44	$	3,257	$	71

There were no troubled debt restructurings that occurred during the six-month period ended June 30, 2017.

There was one commercial real estate troubled debt restructuring during the six month period ending June 30, 2016. The pre-modification and post-modification outstanding recorded investment was $2,091,000. The loan was modified for 2016, by reducing the interest rate as well as extending the term on the loan. The financial impact for the modification was $3,000 reduction in principal payments and $1,000 reduction in interest payments.

Page 21 of 44

Note 5. Reclassifications Out of Accumulated Other Comprehensive Income (a)

Amount Reclassified from Accumulated Other Comprehensive Income

Details about Accumulated Other Comprehensive Income Components	Three Months Ended June 30, 2017			Three Months Ended June 30, 2016			Affected Line Item in the Statement where Net Income is Presented
(in thousands)
Unrealized gains and losses on available-for-sale securities	$	—		$	45		Net gains on sales of investments
		—			(18	)	Provision for income taxes
	$	—		$	27		Net income
Accretion of unrealized losses transferred	$	(662	)	$	(1,170	)	Interest on securities held-to-maturity
		402			408		Provision for income taxes
	$	(260	)	$	(762	)	Net income
Amortization of defined benefit pension items
Prior-service costs	$	(3	)(b)	$	(3	)(b)	Salaries and employee benefits
Actuarial gains (losses)		(385	)(b)		(401	)(b)	Salaries and employee benefits
Total before tax		(388	)		(404	)	Income before taxes
		155			161		Provision for income taxes
	$	(233	)	$	(243	)	Net income
Details about Accumulated Other Comprehensive Income Components	Six Months Ended June 30, 2017			Six Months Ended June 30, 2016			Affected Line Item in the Statement where Net Income is Presented
(in thousands)
Unrealized gains and losses on available-for-sale securities	$	—		$	45		Net gains on sales of investments
		—			(18	)	Provision for income taxes
	$	—		$	27		Net income
Accretion of unrealized losses transferred	$	(1,324	)	$	(2,682	)	Interest on securities held-to-maturity
		691			935		Provision for income taxes
	$	(633	)	$	(1,747	)	Net income
Amortization of defined benefit pension items
Prior-service costs	$	(6	)(b)	$	(5	)(b)	Salaries and employee benefits
Actuarial gains (losses)		(770	)(b)		(802	)(b)	Salaries and employee benefits
Total before tax		(776	)		(807	)	Income before taxes
		311			322		Provision for income taxes
	$	(465	)	$	(485	)	Net income

(a) Amount in parentheses indicates reductions to net income.

(b) These accumulated other comprehensive income components are included in the computation of net periodic pension cost (see Employee Benefits footnote (Note 7) for additional details).

Page 22 of 44

Note 6. Earnings per Share (“EPS”)

Class A and Class B shares participate equally in undistributed earnings. Under the Company’s Articles of Organization, the holders of Class A Common Stock are entitled to receive dividends per share equal to at least 200% of dividends paid, if any, from time to time, on each share of Class B Common Stock.

Diluted EPS includes the dilutive effect of common stock equivalents; basic EPS excludes all common stock equivalents. The Company had no common stock equivalents outstanding for the periods ended June 30, 2017 and 2016.

The following table is a reconciliation of basic EPS and diluted EPS.

	Three Months Ended June 30,				Six Months Ended June 30,
(in thousands except share and per share data)	2017		2016		2017		2016
Basic EPS Computation:
Numerator:
Net income, Class A	$	6,410	$	4,902	$	11,198	$	9,071
Net income, Class B		1,747		1,339		3,055		2,478
Denominator:
Weighted average shares outstanding, Class A		3,603,729		3,600,729		3,602,229		3,600,729
Weighted average shares outstanding, Class B		1,964,180		1,967,180		1,965,680		1,967,180
Basic EPS, Class A	$	1.78	$	1.36	$	3.11	$	2.52
Basic EPS, Class B		0.89		0.68		1.55		1.26
Diluted EPS Computation:
Numerator:
Net income, Class A	$	6,410	$	4,902	$	11,198	$	9,071
Net income, Class B		1,747		1,339		3,055		2,478
Total net income, for diluted EPS, Class A computation		8,157		6,241		14,253		11,549
Denominator:
Weighted average shares outstanding, basic, Class A		3,603,729		3,600,729		3,602,229		3,600,729
Weighted average shares outstanding, Class B		1,964,180		1,967,180		1,965,680		1,967,180
Weighted average shares outstanding diluted, Class A		5,567,909		5,567,909		5,567,909		5,567,909
Weighted average shares outstanding, Class B		1,964,180		1,967,180		1,965,680		1,967,180
Diluted EPS, Class A	$	1.47	$	1.12	$	2.56	$	2.07
Diluted EPS, Class B		0.89		0.68		1.55		1.26

Note 7. Employee Benefits

The Company provides pension benefits to its employees under a noncontributory, defined benefit plan which is funded on a current basis in compliance with the requirements of the Employee Retirement Income Security Act of 1974 (“ERISA”) and recognizes costs over the estimated employee service period.

The Company also has a Supplemental Executive Insurance/Retirement Plan (the “Supplemental Plan”) which is limited to certain officers and employees of the Company. The Supplemental Plan is accrued on a current basis and recognizes costs over the estimated employee service period.

Executive officers of the Company and its subsidiaries who have at least one year of service may participate in the Supplemental Plan. The Supplemental Plan is voluntary and participants are required to contribute to its cost. Life insurance policies, which are owned by the Company, are purchased covering the lives of each participant.

Page 23 of 44

Components of Net Periodic Benefit Cost for the Three Months Ended June 30,

	Pension Benefits						Supplemental Insurance/ Retirement Plan
	2017			2016			2017		2016
	(in thousands)
Service cost	$	310		$	318		$	395	$	455
Interest		362			340			345		334
Expected return on plan assets		(746	)		(694	)		—		—
Recognized prior service cost (benefit)		(26	)		(26	)		29		29
Recognized net actuarial losses		226			200			159		200
Net periodic benefit cost	$	126		$	138		$	928	$	1,018

Components of Net Periodic Benefit Cost for the Six Months Ended June 30,

	Pension Benefits						Supplemental Insurance/ Retirement Plan
	2017			2016			2017		2016
	(in thousands)
Service cost	$	620		$	636		$	790	$	910
Interest		724			680			690		668
Expected return on plan assets		(1,492	)		(1,388	)		—		—
Recognized prior service cost (benefit)		(52	)		(52	)		58		58
Recognized net actuarial losses		452			400			318		400
Net periodic benefit cost	$	252		$	276		$	1,856	$	2,036

Contributions

The Company intends to contribute $1,000,000 to the Pension Plan in 2017. As of June 30, 2017, $500,000 has been contributed.

Note 8. Fair Value Measurements

The Company follows FASB ASC 820-10, Fair Value Measurements and Disclosures, which among other things, requires enhanced disclosures about assets and liabilities carried at fair value. ASC 820-10 establishes a hierarchal disclosure framework associated with the level of pricing observability utilized in measuring financial instruments at fair value. The three broad levels of the hierarchy are as follows:

Level I – Quoted prices are available in active markets for identical assets or liabilities as of the reported date. The type of financial instruments included in Level I are highly liquid cash instruments with quoted prices such as G-7 government, agency securities, listed equities and money market securities, as well as listed derivative instruments.

Level II – Pricing inputs are other than quoted prices in active markets, which are either directly or indirectly observable as of the reported date. The nature of these financial instruments include cash instruments for which quoted prices are available but traded less frequently, derivative instruments whose fair value have been derived using a model where inputs to the model are directly observable in the market, or can be derived principally from or corroborated by observable market data, and instruments that are fair valued using other financial instruments, the parameters of which can be directly observed. Instruments which are generally included in this category are corporate bonds and loans, mortgage whole loans and municipal bonds.

Level III – Instruments that have little to no pricing observability as of the reported date. These financial instruments do not have two-way markets and are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment or estimation. Instruments that are included in this category generally include certain commercial mortgage loans, certain private equity investments, and distressed debt and non-investment grade residual interests in securitizations.

Page 24 of 44

The results of the fair value hierarchy as of June 30, 2017, are as follows:

Financial Instruments Measured at Fair Value on a Recurring Basis:

	Securities AFS Fair Value Measurements Using
	Carrying Value		Quoted Prices In Active Markets for Identitcal Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)
	(in thousands)
U.S . Treasury	$	1,995	$	—	$	1,995	$	—
U.S . Government Sponsored Enterprises		10,000		—		10,000		—
SBA Backed Securities		71,189		—		71,189		—
U.S . Government Agency and Sponsored Mortgage-Backed Securities		223,782		—		223,782		—
Privately Issued Residential Mortgage-Backed Securities		1,015		—		1,015		—
Obligations Issued by States and Political Subdivisions		98,049		—		—		98,049
Other Debt Securities		4,992		—		4,992		—
Equity Securities		318		318		—		—
Total	$	411,340	$	318	$	312,973	$	98,049
Financial Instruments Measured at Fair Value on a Non-recurring Basis:
Impaired Loans	$	230	$	—	$	—	$	230

Impaired loan balances represent those collateral dependent loans where management has estimated the credit loss by comparing the loan’s carrying value against the expected realizable fair value of the collateral. Fair value is generally determined through a review process that includes independent appraisals, discounted cash flows, or other external assessments of the underlying collateral, which generally include various Level 3 inputs which are not observable. The Company discounts the fair values, as appropriate, based on management’s observations of the local real estate market for loans in this category.

Appraisals, discounted cash flows and real estate tax assessments are reviewed quarterly. There is no specific policy regarding how frequently appraisals will be updated. Adjustments are made to appraisals and real estate tax assessments based on management’s estimate of changes in real estate values. Within the past twelve months there have been no updated appraisals, however, all impaired loans have been reviewed during the past quarter using either a discounted cash flow analysis, appraisal of collateral or other type of real estate tax assessment. The types of adjustments that are made to specific provisions (credits) relate to impaired loans recognized for the three and six month periods ended June 30, 2017 amounted to $4,000 and ($5,000), respectively.

There were no transfers between level 1, 2 and 3 for the six months ended June 30, 2017. There were no liabilities measured at fair value on a recurring or nonrecurring basis during the six month period ended June 30, 2017.

Page 25 of 44

The following table presents additional information about assets measured at fair value on a recurring and nonrecurring basis for which the Company has utilized Level 3 inputs to determine fair value (dollars in thousands). Management continues to monitor the assumptions used to value the assets listed below.

Asset	Fair Value		Valuation Technique	Unobservable Input	Unobservable Input Value or Range
Securities AFS (4)	$	98,049	Discounted cash flow	Discount rate	0% -1% (3)
Impaired Loans	$	230	Appraisal of collateral (1)	Appraisal adjustments (2)	0%-30% discount

(1) Fair value is generally determined through independent appraisals of the underlying collateral, which generally include various Level 3 inputs which are not identifiable.

(2) Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated expenses.

(3) Weighted averages.

(4) Municipal securities generally have maturities of one year or less and, therefore, the amortized cost equates to the fair value. There was one auction rate security whose fair value is based on the evaluation of the underlying issuer, prevailing interest rates and market liquidity.

The changes in Level 3 securities for the three month period ended June 30, 2017 are shown in the table below:

	Auction Rate Securities		Obligations Issued by States & Political Subdivisions			Equity Securities		Total
	(in thousands)
Balance at December 31, 2016	$	4,298	$	160,578		$	—	$	164,876
Purchases		—		47,430			—		47,430
Maturities and calls		—		(114,144	)		—		(114,144	)
Amortization		—		(113	)		—		(113	)
Balance at June 30, 2017	$	4,298	$	93,751		$	—	$	98,049

The amortized cost of Level 3 securities was $98,457,000 at June 30, 2017 with an unrealized loss of $408,000. The securities in this category are generally municipal securities with no readily determinable fair value or failed auction rate securities. Management evaluated the fair value of these securities based on an evaluation of the underlying issuer, prevailing rates and market liquidity.

The changes in Level 3 securities for the six month period ended June 30, 2016, are shown in the table below:

	Auction Rate Securities		Obligations Issued by States & Political Subdivisions			Equity Securities			Total
	(in thousands)
Balance at December 31, 2015	$	3,820	$	153,140		$	37		$	156,997
Purchases		—		155,742			—			155,742
Maturities and calls		—		(100,245	)		(37	)		(100,282	)
Amortization		—		(97	)		—			(97	)
Changes in fair value		478		—			—			478
Balance at June 30, 2016	$	4,298	$	208,540		$	—		$	212,838

The amortized cost of Level 3 securities was $213,241,000 at June 30, 2016 with an unrealized loss of $403,000. The securities in this category are generally equity investments, municipal securities with no readily determinable fair value or failed auction rate securities. Management evaluated the fair value of these securities based on an evaluation of the underlying issuer, prevailing rates and market liquidity.

Page 26 of 44

The results of the fair value hierarchy as of December 31, 2016, are as follows:

Financial Instruments Measured at Fair Value on a Recurring Basis:

	Securities AFS Fair Value Measurements Using
	Carrying Value		Quoted Prices In Active Markets for Identitcal Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)
	(in thousands)
U.S. Treasury	$	2,000	$	—	$	2,000	$	—
U.S. Government Sponsored Enterprises		24,952		—		24,952		—
SBA Backed Securities		57,767		—		57,767		—
U.S. Government Agency and Sponsored Mortgage-Backed Securities		243,325		—		243,325		—
Privately Issued Residential Mortgage-Backed Securities		1,109		—		1,109		—
Obligations Issued by States and Political Subdivisions		164,876		—		—		164,876
Other Debt Securities		4,924		—		4,924		—
Equity Securities		344		344		—		—
Total	$	499,297	$	344	$	334,077	$	164,876
Financial Instruments Measured at Fair Value on a Non-recurring Basis:
Impaired Loans	$	260	$	—	$	—	$	260

Impaired loan balances represent those collateral dependent loans where management has estimated the credit loss by comparing the loan’s carrying value against the expected realizable fair value of the collateral. Fair value is generally determined through a review process that includes independent appraisals, discounted cash flows, or other external assessments of the underlying collateral, which generally include various Level 3 inputs which are not identifiable. The Company discounts the fair values, as appropriate, based on management’s observations of the local real estate market for loans in this category.

Appraisals, discounted cash flows and real estate tax assessments are reviewed quarterly. There is no specific policy regarding how frequently appraisals will be updated. Adjustments are made to appraisals and real estate tax assessments based on management’s estimate of changes in real estate values. Within the past twelve months there have been no updated appraisals, however, all impaired loans have been reviewed during the past quarter using either a discounted cash flow analysis, appraisal of collateral or other type of real estate tax assessment. The types of adjustments that are made to specific provisions (credits) relate to impaired loans recognized for 2016 for the estimated credit loss amounted to ($135,000).

There were no transfers between level 1, 2 and 3 for the year ended December 31, 2016. There were no liabilities measured at fair value on a recurring or nonrecurring basis during the year ended December 31, 2016.

The following table presents additional information about assets measured at fair value on a recurring and nonrecurring basis for which the Company has utilized Level 3 inputs to determine fair value (dollars in thousands). Management continues to monitor the assumptions used to value the assets listed below.

Asset	Fair Value		Valuation Technique	Unobservable Input	Unobservable Input Value or Range
Securities AFS (4)	$	164,876	Discounted cash flow	Discount rate	0%-1% (3)
Impaired Loans	$	260	Appraisal of collateral (1)	Appraisal adjustments (2)	0%-30% discount

Page 27 of 44

(1) Fair value is generally determined through independent appraisals of the underlying collateral, which generally include various Level 3 inputs which are not identifiable.

(2) Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated expenses.

(3) Weighted averages

(4) Municipal securities generally have maturities of one year or less and, therefore, the amortized cost equates to the fair value. There was one auction rate security whose fair value is based on the evaluation of the underlying issuer, prevailing interest rates and market liquidity.

Note 9. Fair Values of Financial Instruments

The following methods and assumptions were used by the Company in estimating fair values of its financial instruments. Excluded from this disclosure are all nonfinancial instruments. Accordingly, the aggregate fair value amounts presented do not represent the underlying value of the Company.

The assumptions used below are expected to approximate those that market participants would use in valuing these financial instruments.

Fair value estimates are made at a specific point in time, based on available market information and judgments about the financial instrument, including estimates of timing, amount of expected future cash flows and the credit standing of the issuer. Such estimates do not consider the tax impact of the realization of unrealized gains or losses. In some cases, the fair value estimates cannot be substantiated by comparison to independent markets. In addition, the disclosed fair value may not be realized in the immediate settlement of the financial instrument. Care should be exercised in deriving conclusions about our business, its value or financial position based on the fair value information of financial instruments presented below.

Securities held-to-maturity: The fair values of these securities were based on quoted market prices, where available, as provided by third-party investment portfolio pricing vendors. If quoted market prices were not available, fair values provided by the vendors were based on quoted market prices of comparable instruments in active markets and/or based on a matrix pricing methodology which employs The Bond Market Association’s standard calculations for cash flow and price/yield analysis, live benchmark bond pricing and terms/condition data available from major pricing sources. Management regards the inputs and methods used by third party pricing vendors to be “Level 2 inputs and methods” as defined in the “fair value hierarchy” provided by FASB.

Loans Held-for-Sale: Fair value is measured using quoted market prices when available. These assets are typically categorized as Level 1. If quoted market prices are not available, comparable market values may be utilized. These assets are typically categorized as Level 2.

Loans: For variable-rate loans, that reprice frequently and with no significant change in credit risk, fair values are based on carrying amounts. The fair value of other loans is estimated using discounted cash flow analysis, based on interest rates currently being offered for loans with similar terms to borrowers of similar credit quality. Incremental credit risk for nonperforming loans has been considered.

Time deposits: The fair value of time deposits was estimated using a discounted cash flow approach that applies prevailing market interest rates for similar maturity instruments. The fair values of the Company’s time deposit liabilities do not take into consideration the value of the Company’s long-term relationships with depositors, which may have significant value.

Other borrowed funds: The fair value of other borrowed funds is based on the discounted value of contractual cash flows. The discount rate used is estimated based on the rates currently offered for other borrowed funds of similar remaining maturities.

Subordinated debentures: The fair value of subordinated debentures is based on the discounted value of contractual cash flows. The discount rate used is estimated based on the rates currently offered for other subordinated debentures of similar remaining maturities.

Page 28 of 44

The following presents (in thousands) the carrying amount, estimated fair value, and placement in the fair value hierarchy of the Company’s financial instruments as of June 30, 2017 and December 31, 2016. This table excludes financial instruments for which the carrying amount approximates fair value. Financial assets for which the fair value approximates carrying value include cash and cash equivalents, short-term investments, FHLBB stock and accrued interest receivable. Financial liabilities for which the fair value approximates carrying value include non-maturity deposits, short-term borrowings and accrued interest payable.

June 30, 2017	Carrying Amount		Estimated Fair Value		Fair Value Measurements Level 1 Inputs		Fair Value Level 2 Inputs		Fair Value Level 3 Inputs
	(in thousands)
Financial assets:
Securities held-to-maturity	$	1,722,875	$	1,706,840	$	—	$	1,706,840	$	—
Loans (1)		2,008,510		1,987,896		—		—		1,987,896
Financial liabilities:
Time deposits		575,410		577,804		—		577,804		—
Other borrowed funds		455,500		457,252		—		457,252		—
Subordinated debentures		36,083		36,083		—		—		36,083
December 31, 2016
Financial assets:
Securities held-to-maturity	$	1,653,986	$	1,635,808	$	—	$	1,635,808	$	—
Loans (1)		1,899,527		1,873,703		—		—		1,873,703
Financial liabilities:
Time deposits		478,359		480,133		—		480,133		—
Other borrowed funds		293,000		294,940		—		294,940		—
Subordinated debentures		36,083		36,083		—		—		36,083

(1) Comprised of loans (including collateral dependent impaired loans), net of deferred loan costs and the allowance for loan losses.

Note 10. Recent Accounting Developments

In March 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) ASU 2017-08, Receivables—Nonrefundable Fees and Other Costs (Subtopic 310-20) Premium Amortization on Purchased Callable Debt. The FASB is issuing this ASU to amend the amortization period for certain purchased callable debt securities held at a premium. The FASB is shortening the amortization period for the premium to the earliest call date. Under current generally accepted accounting principles (GAAP), entities generally amortize the premium as an adjustment of yield over the contractual life of the instrument. For public business entities, the amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Management is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2017.

In March 2017, the FASB issued ASU 2017-07, Compensation-Retirement benefits (Topic 715) Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The amendments in this ASU require that an employer disaggregate the service cost component from the other components of net benefit cost. The amendments also provide explicit guidance on how to present the service cost component and the other components of net benefit cost in the income statement and allow only the service cost component of net benefit cost to be eligible for capitalization. The amendments in this ASU are effective for fiscal years beginning after December 15, 2017. Early adoption is permitted. Management is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2017.

In February 2017, the FASB issued ASU 2017-06, Plan Accounting: Defined Benefit Pension Plans (Topic 960) Defined Contribution Pension Plans (Topic 962) Health and Welfare Benefit Plans (Topic 965), Employee Benefit Plan Master Trust Reporting. The FASB has issued this ASU to improve the usefulness of the information reported to users of employee benefit plan financial statements and to provide clarity to preparers and auditors. This ASU relates primarily to the reporting by an employee benefit plan for its interest in a master trust. The amendments in this ASU clarify presentation requirements for a plan’s interest in a master trust and require more detailed disclosures of the plan’s interest in the master trust. The amendments in this ASU are effective for fiscal years beginning after December 15, 2018. Early adoption is permitted. Management is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2017.

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In February 2017, the FASB issued ASU 2017-05, Other Income Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20). This ASU was issued to clarify the scope of Subtopic 610-20, and to add guidance for partial sales of nonfinancial assets. For public entities, this ASU is effective for annual reporting periods beginning after December 15, 2017. Management believes that this ASU applies and is assessing the impact, if any, as of June 30, 2017.

In January 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2017-04, Intangibles – Goodwill and Other (Topic 350). This ASU was issued to simplify the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. For public entities, this ASU is effective for the fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted and application should be on a prospective basis. Management is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2017.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This ASU was issued to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. To achieve this objective, the amendments in this ASU replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The amendments in this ASU are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The Company is currently assessing this ASU and has not determined the impact, if any, as of June 30, 2017.

In May 2016, the FASB issued ASU 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients. The intention of this ASU is to provide additional clarification on specific issues brought forth by the FASB and the International Accounting Standards Board Joint Transition Resource Group for Revenue Recognition in relation to Topic 606 and revenue recognition. This ASU is to have the same effective date as ASU 2015-14 which deferred the effective date of ASU 2014-09 to December 15, 2017. Management has determined that ASU 2016-12 does apply, but has not determined the impact, if any, as of June 30, 2017. Management assembled a project team to address the changes pursuant to Topic 606. The project team has made an initial scope assessment and additional progress over the topic is expected to be made in the third quarter of 2017.

In February 2016, the FASB issued ASU 2016-02, Leases. This ASU requires lessees to put most leases on their balance sheet but recognize expenses on their income statements in a manner similar to today’s accounting. This ASU also eliminates today’s real estate-specific provisions for all companies. For lessors, this ASU modifies the classification criteria and the accounting for sales-type and direct financing leases. This ASU is effective for fiscal years beginning after December 15, 2018, including interim periods therein. Early adoption is permitted. The Company is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2017.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Executive Overview

Century Bancorp, Inc. (together with its bank subsidiary, unless the context otherwise requires, the “Company”) is a Massachusetts state-chartered bank holding company headquartered in Medford, Massachusetts. The Company is a Massachusetts corporation formed in 1972 and has one banking subsidiary (the “Bank”): Century Bank and Trust Company formed in 1969. At June 30, 2017, the Company had total assets of $4.5 billion. Currently, the Company operates 27 banking offices in 20 cities and towns in Massachusetts, ranging from Braintree in the south to Andover in the north. The Bank’s customers consist primarily of small and medium-sized businesses and retail customers in these communities and surrounding areas, as well as local governments, businesses, and educational institutions throughout Massachusetts, New Hampshire, Rhode Island, Connecticut and New York.

The Company’s results of operations are largely dependent on net interest income, which is the difference between the interest earned on loans and securities and interest paid on deposits and borrowings. The results of operations are also affected by the level of income and fees from loans, deposits, as well as operating expenses, the provision for loan losses, the impact of federal and state income taxes and the relative levels of interest rates and economic activity.

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The Company offers a wide range of services to commercial enterprises, state and local governments and agencies, non-profit organizations and individuals. It emphasizes service to small and medium sized businesses and retail customers in its market area. In recent quarters, the Company has increased business to larger institutions, specifically, healthcare and higher education. The Company makes commercial loans, real estate and construction loans and consumer loans, and accepts savings, time, and demand deposits. In addition, the Company offers its corporate and institutional customers automated lock box collection services, cash management services and account reconciliation services, and actively promotes the marketing of these services to the municipal market. Also, the Company provides full service securities brokerage services through a program called Investment Services at Century Bank, which is supported by LPL Financial, a third party full-service securities brokerage business.

The Company has municipal cash management client engagements in Massachusetts, New Hampshire and Rhode Island comprising of approximately 250 government entities.

Net income for the six months ended June 30, 2017, was $14,253,000 or $2.56 per Class A share diluted, an increase of 23.4% compared to net income of $11,549,000, or $2.07 per Class A share diluted, for the same period a year ago. For the quarter ended June 30, 2017, net income totaled $8,157,000 or $1.47 per Class A share diluted, an increase of 30.7% compared to net income of $6,241,000, or $1.12 per Class A share diluted, for the same period a year ago.

Earnings per share (EPS) for each class of stock and time period is as follows:

	Three Months Ended June 30,
	2017		2016
Basic EPS – Class A common	$	1.78	$	1.36
Basic EPS – Class B common	$	0.89	$	0.68
Diluted EPS – Class A common	$	1.47	$	1.12
Diluted EPS – Class B common	$	0.89	$	0.68
	Six Months Ended June 30,
	2017		2016
Basic EPS – Class A common	$	3.11	$	2.52
Basic EPS – Class B common	$	1.55	$	1.26
Diluted EPS – Class A common	$	2.56	$	2.07
Diluted EPS – Class B common	$	1.55	$	1.26

Net interest income totaled $42,561,000 for the six months ended June 30, 2017 compared to $36,106,000 for the same period in 2016. The 17.9% increase in net interest income for the period is primarily due to an increase in average earning assets and an increase in the net interest margin. The net interest margin increased from 2.16% on a fully taxable equivalent basis in 2016 to 2.23% for the same period in 2017. This was primarily the result of an increase in rates on earning assets and prepayment penalties collected. The average balances of earning assets increased by 12.9% combined with a similar increase in average deposits. Also, interest expense increased 18.2% primarily as a result of an increase in rates and an increase in deposit balances.

The trends in the net interest margin are illustrated in the graph below:

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During the second and third quarter of 2015 the net interest margin increased primarily as a result of an increase in higher yielding assets as well as prepayment penalties collected. The increase in higher yielding assets was primarily the result of increased purchases of securities held-to-maturity. The margin decreased during the fourth quarter of 2015 primarily as a result of lower yielding loan originations. The margin increased during the first quarter of 2016 primarily as a result of an increase in rates on earning assets. The margin decreased during the second, third, and fourth quarters of 2016 primarily as a result of a decrease in rates on earning assets. The margin increased during the first and second quarters of 2017 primarily as a result of an increase in rates on earning assets. This increase was primarily the result of the yield on floating rate assets increasing as a result of recent increases in short term interest rates as well as an increase in prepayment penalties collected during the second quarter of 2017. Prepayment penalties collected amounted to $825,000 and contributed approximately seven basis points to the net interest margin for the second quarter. During the first and second quarters of 2017, the Company has not seen a corresponding increase in short term rates on interest bearing liabilities.

While management will continue its efforts to improve the net interest margin, there can be no assurance that certain factors beyond its control, such as the prepayment of loans and changes in market interest rates, will continue to positively impact the net interest margin.

The provision for loan losses increased by $90,000 from $800,000 for the six months ended June 30, 2016 to $890,000 for the same period in 2017, primarily as a result of an increase in loan growth offset, somewhat, by changes in historical loss factors. Refer to the allowance for loan loss section of the management discussion and analysis for additional discussion. Non-performing assets totaled $1,122,000 at June 30, 2017, compared to $1,084,000 at December 31, 2016.

For the first six months of 2017, the Company’s effective income tax rate was 4.7% compared to 0.7% for last year’s corresponding period. The effective income tax rate increased primarily as a result of an increase in taxable income.

During June 2016, the Company entered into a lease agreement to open a new branch located in Wellesley, Massachusetts. The Company closed its existing Wellesley branch and transferred the accounts to the new Wellesley branch which opened on December 19, 2016.

Recent Market Developments

Since June 2009, the U.S. economy has been recovering from the most severe recession and financial crisis since the Great Depression. There have been improvements in private sector employment, industrial production and U.S. exports. Even though the U.S. economy is in its eighth year of expansion, the consensus forecast is for expansion through at least 2018. Short and medium-term risks to the outlook include uncertainty in the United States over potential fiscal policy changes and uncertainty in Europe with respect to the United Kingdom’s decision to leave the European Union. Long-term risks to the U.S. economy include the slowdown in productivity growth, which may pose a risk to the U.S. standard of living.

On July 21, 2010, the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Act”) became law. The Act was intended to address many issues arising in the recent financial crisis and is exceedingly broad in scope, affecting many aspects of bank and financial market regulation. The Act requires, or permits by implementing regulation, enhanced prudential standards for banks and bank holding companies inclusive of capital, leverage, liquidity, concentration and exposure measures. In addition, traditional bank regulatory principles such as restrictions on transactions with affiliates and insiders were enhanced. The Act also contains reforms of consumer mortgage lending practices and creates a Bureau of Consumer Financial Protection, which is granted broad authority over consumer financial practices of banks and others. It is expected as the specific new or incremental requirements applicable to the Company become effective that the costs and difficulties of remaining compliant with all such requirements will increase. The Act broadened the base for FDIC assessments to average consolidated assets less tangible equity of financial institutions and also permanently raises the current standard maximum FDIC deposit insurance amount to $250,000. The Act extended unlimited deposit insurance on non-interest bearing transaction accounts through December 31, 2012.

In addition, the Act added a new Section 13 to the Bank Holding Company Act, the so-called “Volcker Rule,” (the “Rule”) which generally restricts certain banking entities such as the Company and its subsidiaries or affiliates, from engaging in proprietary trading activities and owning equity in or sponsoring any private equity or hedge fund. The Rule became effective July 21, 2012. The final implementing regulations for the Rule were issued by various regulatory agencies in December, 2013 and under an extended conformance regulation compliance was required to be achieved by July 21, 2015. The conformance period for investments in and relationships with certain “legacy covered funds” has been extended to July 21, 2017. Under the Rule, the Company may be restricted from engaging in proprietary trading, investing in third party hedge or private equity funds or sponsoring new funds unless it

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qualifies for an exemption from the rule. The Company has little involvement in prohibited proprietary trading or investment activities in covered funds and the Company does not expect that complying with the requirements of the Rule will have any material effect on the Company’s financial condition or results of operation. The 2016 Presidential election and resulting change to a Republican Administration created the possibility that some of the “reforms” contained in the Act may be repealed or modified. New reforms under discussion include the prospect of some type of regulatory burden relief for small banks which in this context might include the Company. The extent and consequences of any such changes can’t be currently assessed but at the present time the Company does not think it is likely that changes that may be made will have any material effect on the Company’s financial condition and results of operations.

Federal banking regulators have issued risk-based capital guidelines, which assign risk factors to asset categories and off-balance-sheet items. Also, the Basel Committee has issued capital standards entitled “Basel III: A global regulatory framework for more resilient banks and banking systems” (“Basel III”). The Federal Reserve Board has finalized its rule implementing the Basel III regulatory capital framework. The rule that came into effect in January 2015 sets the Basel III minimum regulatory capital requirements for all organizations. It included a new common equity Tier I ratio of 4.5 percent of risk-weighted assets, raised the minimum Tier I capital ratio from 4 percent to 6 percent of risk-weighted assets and would set a new conservation buffer of 2.5 percent of risk-weighted assets. The implementation of the framework did not have a material impact on the Company’s financial condition or results of operations.

Financial Condition

Loans

On June 30, 2017, total loans outstanding were $2,033,799,000, up by $109,866,000 from the total on December 31, 2016. At June 30, 2017, commercial real estate loans accounted for 36.2%, commercial and industrial accounted for 31.9%, and residential real estate loans, including home equity loans, accounted for 24.3% of total loans.

Commercial real estate loans increased to $736,603,000 at June 30, 2017 from $696,173,000 at December 31, 2016, primarily as a result of new loan originations. Residential real estate loans increased to $264,744,000 at June 30, 2017 from $241,357,000 at December 31, 2016, primarily as a result of new loan originations. Home equity loans increased to $229,274,000 at June 30, 2017 from $211,857,000 at December 31, 2016, primarily as a result of a home equity loan promotion.

Commercial and industrial loans increased to $650,542,000 at June 30, 2017 from $612,503,000 at December 31, 2016, primarily as a result of an increase in larger loan originations to large institutions. Construction loans decreased to $14,159,000 at June 30, 2017 from $14,928,000 on December 31, 2016, primarily from payoffs of existing loans. Municipal loans decreased to $127,259,000 from $135,418,000, primarily as a result of payoffs of existing loans. In recent quarters, the Company has increased business to larger institutions, specifically, healthcare, higher education, and municipal organizations. Further discussion relating to changes in portfolio composition is discussed in the allowance for loan loss section of the management discussion and analysis.

Allowance for Loan Losses

The allowance for loan loss at June 30, 2017 was $25,289,000 as compared to $24,406,000 at December 31, 2016. The level of the allowance for loan losses to total loans was 1.24% at June 30, 2017 and 1.27% at December 31, 2016.

During 2015, the Company enhanced its approach to the development of the historical loss factors and qualitative factors used on certain loan portfolios. The methodology enhancement was in response to the changes in the risk characteristics of the Company’s new loan originations, as the Company has continued to increase its exposure to larger loan originations to large institutions with strong credit quality. The Company has limited internal loss history experience with these types of loans, and has determined a more appropriate representation of loss expectation is to utilize external historical loss factors based on public credit ratings, as there is a great deal of default and loss data available on these types of loans from the credit rating agencies. As of June 30, 2015, the Company incorporated this information into the development of the historical loss rates for these loan types. The combination of the enhancements made to the allowance methodology to address the changing risk profile of the Company’s new loan originations and the increase in these loans types as a percentage of the overall portfolio, has resulted in a decrease in the ratio of allowance for loan losses to total loans for 2016 and has continued into 2017. Also, during 2016 and the first six months of 2017, the Company’s weighted average risk rating has decreased. Additionally, the Company has continued to increase its lending for large loans to large institutions with publicly available credit ratings. The historical loss allocation for these types of loans is low. This has contributed to the continued decrease in the ratio of allowance for loan losses to total loans for 2017.

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In addition, the Company monitors the outlook for the industries in which these institutions operate. Healthcare and higher education are the primary industries. The Company also monitors the volatility of the losses within the historical data.

By combining the credit rating, the industry outlook and the loss volatility, the Company arrives at the quantitative loss factor for each credit grade.

For a large loan to large institutions with publically available credit ratings the Company tracks these ratings. These ratings are tracked as a credit quality indicator for these loans. Credit ratings issued by national organizations were utilized as credit quality indicators as presented in the following table at June 30, 2017.

	Commercial and Industrial		Municipal		Commercial Real Estate		Total
			(in thousands)
Credit Rating:
Aaa – Aa3	$	341,777	$	66,484	$	45,615	$	453,876
A1 – A3		218,222		8,225		128,927		355,374
Baa1 – Baa3		—		46,970		125,775		172,745
Ba2		—		2,730		—		2,730
Total	$	559,999	$	124,409	$	300,317	$	984,725

Credit ratings issued by national organizations are presented in the following table at December 31, 2016.

	Commercial and Industrial		Municipal		Commercial Real Estate		Total
			(in thousands)
Credit Rating:
Aaa – Aa3	$	334,674	$	66,245	$	6,596	$	407,515
A1 – A3		188,777		33,365		129,423		351,565
Baa1 – Baa3		—		26,970		127,366		154,336
Ba2		—		3,610		—		3,610
Total	$	523,451	$	130,190	$	263,385	$	917,026

The allowance for loan losses is an estimate of the amount needed for an adequate reserve to absorb losses in the existing loan portfolio. This amount is determined by an evaluation of the loan portfolio, including input from an independent organization engaged to review selected larger loans, a review of loan experience and current economic conditions. Although the allowance is allocated between categories, the entire allowance is available to absorb losses attributable to all loan categories.

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The following table summarizes the changes in the Company’s allowance for loan losses for the periods indicated.

	Three months ended June 30,						Six months ended June 30,
	2017			2016			2017			2016
	(in thousands)
Allowance for loan losses, beginning of period	$	24,827		$	23,544		$	24,406		$	23,075
Adjustment		—			(84	)		—			(84	)
Loans charged off		(100	)		(111	)		(197	)		(180	)
Recoveries on loans previously charged-off		72			164			190			252
Net (charge-offs) recoveries		(28	)		53			(7	)		72
Provision charged to expense		490			350			890			800
Allowance for loan losses, end of period	$	25,289		$	23,863		$	25,289		$	23,863

The Company may experience increased levels of nonaccrual loans if borrowers are negatively impacted by future negative economic conditions. Management continually monitors trends in the loan portfolio to determine the appropriate level of allowance for loan losses. At the current time, management believes that the allowance for loan losses is adequate.

Nonperforming Assets

The following table sets forth information regarding nonperforming assets held by the Bank at the dates indicated:

	June 30 2017			December 31, 2016
	(dollars in thousands)
Nonaccruing loans	$	1,122		$	1,084
Total nonperforming assets	$	1,122		$	1,084
Loans past due 90 days or more and still accruing	$	—		$	—
Nonaccruing loans as a percentage of total loans		0.06	%		0.06	%
Nonperforming assets as a percentage of total assets		0.02	%		0.02	%
Accruing troubled debt restructures	$	2,872		$	3,526

Cash and Cash Equivalents

Cash and cash equivalents decreased from $236,151,000 to $228,161,000 during the first six months of 2017. This decrease was primarily attributable to increased loan originations.

Short-term Investments

Short-term investments decreased by $3,183,000, primarily as a result of maturities during the first six months of 2017.

Investments

Management continually evaluates its investment alternatives in order to properly manage the overall balance sheet mix. The timing of purchases, sales and reinvestments, if any, will be based on various factors including expectation of movements in market interest rates, deposit flows and loan demand. Notwithstanding these events, it is the intent of management to grow the earning asset base mainly through loan originations while funding this growth through a mix of retail deposits, FHLB advances, and retail repurchase agreements.

Securities Available-for-Sale (at Fair Value)

The securities available-for-sale portfolio totaled $411,340,000 at June 30, 2017, a decrease of 17.6% from December 31, 2016. The portfolio decreased mainly as a result of calls and maturities of securities available-for-sale totaling $166,976,000 for the six months ended June 30, 2017. The calls and maturities were offset by purchases of $71,793,000. The portfolio is concentrated in United States Government Sponsored Enterprises, Mortgage-backed Securities and Obligations issued by States and Political Subdivisions and had an estimated weighted average remaining life of 5.4 years.

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At June 30, 2017, 76.1% of the Company’s securities available-for-sale are classified as Level 2. The fair values of these securities are generally obtained from a pricing service, which provides the Company with a description of the inputs generally utilized for each type of security. These inputs include benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data. Market indicators and industry and economic events are also monitored.

Securities available-for-sale totaling $98,049,000 or 23.8% of securities available-for-sale are classified as Level 3. These securities are generally municipal securities with no observable fair value. The securities are carried at cost which approximates fair value. A periodic review of underlying financial statements and credit ratings is performed to assess the appropriateness of these valuations.

During the first six months of 2017, net unrealized losses on the securities available-for-sale decreased to $369,000 from a net unrealized loss of $923,000 at December 31, 2016. The following table sets forth the fair value of securities available-for-sale at the dates indicated.

	June 30, 2017		December 31, 2016
	(in thousands)
U.S. Treasury	$	1,995	$	2,000
U.S. Government Sponsored Enterprises		10,000		24,952
Small Business Administration		71,189		57,767
U.S Government Agency and Sponsored Enterprise Mortgage-backed Securities		223,782		243,325
Privately Issued Residential Mortgage-backed Securities		1,015		1,109
Obligations issued by States and Political Subdivisions		98,049		164,876
Other Debt Securities		4,992		4,924
Equity Securities		318		344
Total Securities Available–for-Sale	$	411,340	$	499,297

There were no sales of investments during the first six months of 2017.

Securities Held-to-Maturity (at Amortized Cost)

The securities held-to-maturity portfolio totaled $1,722,875,000 on June 30, 2017, an increase of 4.2% from December 31, 2016. Purchases of securities held-to-maturity totaled $220,832,000 for the six months ended June 30, 2017. The purchases were offset, somewhat, by calls and maturities of $153,405,000. The portfolio is concentrated in United States Government Sponsored Enterprises and Mortgage-backed Securities and had an estimated weighted average remaining life of 4.4 years. The following table sets forth the fair value of securities held-to-maturity at the dates indicated.

	June 30, 2017		December 31, 2016
	(in thousands)
U.S. Government Sponsored Enterprises	$	134,378	$	148,326
SBA Backed Securities		54,427		46,140
U.S. Government Agency and Sponsored Enterprise Mortgage-backed Securities		1,534,070		1,459,520
Total Securities Held-to-Maturity	$	1,722,875	$	1,653,986

At June 30, 2017 and December 31, 2016, all mortgage-backed securities are obligations of U.S. Government Sponsored Enterprises. There were no sales of investments for the three months ending June 30, 2017.

Debt securities of Government Sponsored Enterprises primarily refer to debt securities of Fannie Mae and Freddie Mac.

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Federal Home Loan Bank of Boston Stock

The Bank, as a member of the Federal Home Loan Bank of Boston (“FHLBB”), is required to maintain an investment in capital stock of the FHLBB. Based on redemption provisions, the stock has no quoted market value and is carried at cost. At its discretion, the FHLBB may declare dividends on the stock. The Company reviews for impairment based on the ultimate recoverability of the cost basis in the stock. During the first six months of 2017, the FHLBB redeemed $714,000 of FHLBB stock and the Company purchased $5,260,000 of FHLBB stock. As of June 30, 2017, no impairment has been recognized.

Deposits and Borrowed Funds

On June 30, 2017, deposits totaled $3,569,197,000, representing a 2.3% decrease from December 31, 2016. Total deposits decreased primarily as a result of decreases in money market accounts. Money market deposits decreased mainly as a result of decreased corporate account balances. Savings and NOW deposits increased, mainly as a result of corporate, personal, and municipal deposits, as the Company continued to offer competitive rates for these types of deposits during the first six months of the year. Time deposits increased primarily as a result of increased personal, corporate, and municipal time deposits as the Company has offered competitive rates for these types of deposits.

Borrowed funds totaled $622,840,000 at June 30, 2017 compared to $475,280,000 at December 31, 2016. Borrowed funds increased mainly as a result of an increase in short-term FHLBB borrowings, offset, somewhat, by a decrease in securities sold under agreements to repurchase. Securities sold under agreements to repurchase decreased, primarily as a result of decreases in corporate accounts.

Stockholders’ Equity

At June 30, 2017, total equity was $254,625,000 compared to $240,041,000 million at December 31, 2016. The Company’s equity increased primarily as a result of earnings and a decrease in other comprehensive loss, net of taxes, offset somewhat by dividends paid. Other comprehensive loss, net of taxes, decreased as a result of a decrease in unrealized losses on securities available-for-sale, unrealized losses on securities transferred from available-for-sale to held-to-maturity and amortization of the pension liability. The Company’s leverage ratio stood at 6.31% at June 30, 2017, compared to 6.28% at December 31, 2016. The increase in the leverage ratio was due to an increase in stockholders’ equity, offset somewhat by an increase in quarterly average assets. Book value as of June 30, 2017 was $45.73 per share compared to $43.11 at December 31, 2016.

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Results of Operations

The following table sets forth the distribution of the Company’s average assets, liabilities and stockholders’ equity, and average rates earned or paid on a fully taxable equivalent basis for each of the three-month periods indicated.

	Three Months Ended
	June 30, 2017									June 30, 2016
	Average Balance			Interest Income/ Expenses (1)			Rate Earned/ Paid (1)			Average Balance			Interest Income/ Expenses (1)			Rate Earned/ Paid (1)
	(dollars in thousands)
ASSETS
Interest-earning assets:
Loans (2)
Loans taxable	$	970,317		$	9,742			4.03	%	$	840,670		$	8,321			3.98	%
Loans tax-exempt		1,081,163			10,529			3.91	%		952,325			8,963			3.79	%
Securities available-for-sale (5):
Taxable		366,995			1,411			1.54	%		329,645			918			1.11	%
Tax-exempt		124,060			442			1.43	%		142,691			315			0.88	%
Securities held-to-maturity:
Taxable		1,771,395			9,824			2.22	%		1,519,615			8,128			2.14	%
Interest-bearing deposits in other banks		137,052			349			1.02	%		238,076			308			0.52	%
Total interest-earning assets		4,450,982			32,297			2.91	%		4,023,022			26,953			2.69	%
Non interest-earning assets		220,892									208,568
Allowance for loan losses		(25,115	)								(23,764	)
Total assets	$	4,646,759								$	4,207,826
LIABILITIES AND STOCKHOLDERS’ EQUITY
Interest-bearing deposits:
NOW accounts	$	1,024,625		$	881			0.34	%	$	892,631		$	526			0.24	%
Savings accounts		509,746			619			0.49	%		405,976			412			0.41	%
Money market accounts		1,064,211			1,234			0.47	%		990,215			781			0.32	%
Time deposits		555,923			1,902			1.37	%		449,372			1,394			1.25	%
Total interest-bearing deposits		3,154,505			4,636			0.59	%		2,738,194			3,113			0.46	%
Securities sold under agreements to repurchase		196,354			120			0.25	%		233,197			126			0.22	%
Other borrowed funds and subordinated debentures		320,358			1,945			2.44	%		365,259			2,247			2.47	%
Total interest-bearing liabilities		3,671,217			6,701			0.73	%		3,336,650			5,486			0.66	%
Non-interest-bearing liabilities
Demand deposits		664,602									589,491
Other liabilities		60,339									57,994
Total liabilities		4,396,158									3,984,135
Stockholders’ equity		250,601									223,691
Total liabilities & stockholders’ equity	$	4,646,759								$	4,207,826
Net interest income on a fully taxable equivalent basis					25,596									21,467
Less taxable equivalent adjustment					(3,491	)								(3,211	)
Net interest income				$	22,105								$	18,256
Net interest spread (3)								2.18	%								2.03	%
Net interest margin (4)								2.31	%								2.15	%

(1) On a fully taxable equivalent basis calculated using a federal tax rate of 34%.

(2) Nonaccrual loans are included in average amounts outstanding.

(3) Interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.

(4) Net interest margin represents net interest income as a percentage of average interest-earning assets.

(5) Average balances of securities available-for-sale calculated utilizing amortized cost.

Page 38 of 44

The following table sets forth the distribution of the Company’s average assets, liabilities and stockholders’ equity, and average rates earned or paid on a fully taxable equivalent basis for each of the six-month periods indicated.

	Six Months Ended
	June 30, 2017									June 30, 2016
	Average Balance			Interest Income/ Expenses (1)			Rate Earned/ Paid (1)			Average Balance			Interest Income/ Expenses (1)			Rate Earned/ Paid (1)
	(dollars in thousands)
ASSETS
Interest-earning assets:
Loans (2)
Loans taxable	$	952,817		$	18,775			3.97	%	$	848,656		$	16,712			3.96	%
Loans tax-exempt		1,065,457			19,794			3.75	%		941,296			17,843			3.81	%
Securities available-for-sale (5):
Taxable		374,463			2,676			1.43	%		306,370			1,693			1.11	%
Tax-exempt		137,690			926			1.35	%		137,039			581			0.85	%
Securities held-to-maturity:
Taxable		1,761,470			19,359			2.20	%		1,477,252			15,940			2.16	%
Interest-bearing deposits in other banks		170,604			742			0.87	%		242,004			623			0.51	%
Total interest-earning assets		4,462,501			62,272			2.80	%		3,952,617			53,392			2.71	%
Non interest-earning assets		220,643									206,058
Allowance for loan losses		(24,849	)								(23,523	)
Total assets	$	4,658,295								$	4,135,152
LIABILITIES AND STOCKHOLDERS’ EQUITY
Interest-bearing deposits:
NOW accounts	$	995,569		$	1,581			0.32	%	$	863,073		$	1,013			0.24	%
Savings accounts		498,490			1,146			0.46	%		395,158			763			0.39	%
Money market accounts		1,140,029			2,508			0.44	%		983,562			1,576			0.32	%
Time deposits		529,040			3,553			1.35	%		448,890			2,752			1.23	%
Total interest-bearing deposits		3,163,128			8,788			0.56	%		2,690,683			6,104			0.46	%
Securities sold under agreements to repurchase		198,394			223			0.23	%		227,888			241			0.21	%
Other borrowed funds and subordinated debentures		320,047			3,873			2.44	%		365,814			4,554			2.50	%
Total interest-bearing liabilities		3,681,569			12,884			0.71	%		3,284,385			10,899			0.67	%
Non-interest-bearing liabilities
Demand deposits		670,241									573,303
Other liabilities		59,505									56,817
Total liabilities		4,411,315									3,914,505
Stockholders’ equity		246,980									220,647
Total liabilities & stockholders’ equity	$	4,658,295								$	4,135,152
Net interest income on a fully taxable equivalent basis					49,388									42,493
Less taxable equivalent adjustment					(6,827	)								(6,387	)
Net interest income				$	42,561								$	36,106
Net interest spread (3)								2.09	%								2.04	%
Net interest margin (4)								2.23	%								2.16	%

(1) On a fully taxable equivalent basis calculated using a federal tax rate of 34%.

(2) Nonaccrual loans are included in average amounts outstanding.

(3) Interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.

(4) Net interest margin represents net interest income as a percentage of average interest-earning assets.

(5) Average balances of securities available-for-sale calculated utilizing amortized cost.

Page 39 of 44

The following table presents certain information on a fully-tax equivalent basis regarding changes in the Company’s interest income and interest expense for the periods indicated. For each category of interest-earning assets and interest-bearing liabilities, information is provided with respect to changes attributable to changes in rate and changes in volume.

	Three Months Ended June 30, 2017 Compared with Three Months Ended June 30, 2016									Six Months Ended June 30, 2017 Compared with Six Months Ended June 30, 2016
	Increase/(Decrease) Due to Change in									Increase/(Decrease) Due to Change in
	Volume			Rate			Total			Volume			Rate			Total
	(in thousands)
Interest income:
Loans
Taxable	$	1,322		$	99		$	1,421		$	2,007		$	56		$	2,063
Tax-exempt		1,267			299			1,566			2,268			(317	)		1,951
Securities available-for-sale
Taxable		113			380			493			424			559			983
Tax-exempt		(46	)		173			127			3			342			345
Securities held-to-maturity
Taxable		1,387			309			1,696			3,119			300			3,419
Interest-bearing deposits in other banks		(169	)		210			41			(222	)		341			119
Total interest income		3,874			1,470			5,344		$	7,599		$	1,281		$	8,880
Interest expense:
Deposits
NOW accounts		87			268			355			171			397			568
Savings accounts		118			89			207			220			163			383
Money market accounts		63			390			453			276			656			932
Time deposits		357			151			508			516			285			801
Total interest-bearing deposits		625			898			1,523			1,183			1,501			2,684
Securities sold under agreements to repurchase		(21	)		15			(6	)		(33	)		15			(18	)
Other borrowed funds and subordinated debentures		(268	)		(34	)		(302	)		(567	)		(114	)		(681	)
Total interest expense		336			879			1,215			583			1,402			1,985
Change in net interest income	$	3,538		$	591		$	4,129		$	7,016		$	(121	)	$	6,895

Net Interest Income

For the three months ended June 30, 2017, net interest income on a fully taxable equivalent basis totaled $25,596,000 compared to $21,467,000 for the same period in 2016, an increase of $4,129,000 or 19.2%. This increase in net interest income for the period is primarily due to an increase in average interest earning assets combined with a sixteen basis point increase in the net interest margin. The average balance of earning assets increased by 10.6% combined with a similar increase in average deposits. The net interest margin increased from 2.15% on a fully taxable equivalent basis in 2016 to 2.31% on the same basis for 2017. This was primarily the result of an increase in rates on earning assets. Prepayment penalties collected increased from $4,000 for the three months ended June 30, 2016 compared to $825,000 for the same period in 2017. This increase contributed approximately seven basis points to the increase in the net interest margin. Also, interest income on a fully taxable equivalent basis increased 19.8%, mainly as a result of an increase in interest earning assets. Interest expense increased 22.1% mainly as a result of an increase in deposit balances.

Page 40 of 44

For the six months ended June 30, 2017, net interest income on a fully taxable equivalent basis totaled $49,388,000 compared to $42,493,000 for the same period in 2016, an increase of $6,895,000 or 16.2%. This increase in net interest income for the period is primarily due to an increase in average interest earning assets combined with a seven basis point increase in the net interest margin. The average balance of earning assets increased by 10.6% combined with a similar increase in average deposits. The net interest margin increased from 2.16% on a fully taxable equivalent basis in 2016 to 2.23% on the same basis for 2017. This was primarily the result of an increase in rates on earning assets. Prepayment penalties collected increased from $31,000 for the six months ended June 30, 2016 compared to $857,000 for the same period in 2017. This increase contributed approximately four basis points to the increase in the net interest margin. Also, interest income on a fully taxable equivalent basis increased 19.8%, mainly as a result of an increase in interest earning assets. Interest expense increased 22.1% mainly as a result of an increase in deposit balances.

As illustrated in the table above, the main contributors to the increase in net interest income were from securities held-to-maturity, loans and securities available-for-sale. Securities held-to-maturity income increased primarily as a result of an increase in volume. Loans income increased primarily from an increase in volume, this was partially offset by decrease rates on loans from new loan originations. Securities available-for-sale income increased from both an increase in volume and an increase in rates paid on the portfolio. The Company has a sizable floating rate available-for-sale portfolio. These securities reprice as interest rates rise. The increase in net interest income was partially offset by an increase in interest expense. This was mainly the result of increased rates paid on money market, saving and NOW accounts. The Company has modestly raised interest rates on these products to remain competitive.

Provision for Loan Losses

For the three months ended June 30, 2017, the loan loss provision was $490,000 compared to a provision of $350,000 for the same period last year. For the six months ended June 30, 2017, the loan loss provision was $890,000 compared to a provision of $800,000 for the same period last year. The increase in the provision, for both time periods presented, was primarily as a result of an increase in loan growth offset, somewhat, by changes in historical loss factors. Further discussion relating to changes in portfolio composition is discussed in footnote number four.

Non-Interest Income and Expense

Other operating income for the quarter ended June 30, 2017 decreased by $352,000 from the same period last year to $4,291,000. This was mainly attributable to a decrease in gains on sales of mortgage loans of $529,000, a decrease of $45,000 in net gains on sales of investments, and a decrease of $22,000 in lock box income. This was partially offset by an increase of $132,000 in other income and a $112,000 increase in service charges on deposit accounts. Other income increased primarily as a result of an increase in wealth management fees, merchant and charge card fees, and other customer fees. Also, service charges on deposit accounts increased primarily as a result of an increase in customer activity. Lockbox income decreased mainly as a result of decreased customer activity.

Other operating income for the six months ended June 30, 2017 decreased by $97,000 from the same period last year to $8,200,000. This was mainly attributable to a decrease in gains on sales of mortgage loans of $428,000, a decrease of $45,000 in net gains on sales of investments, and a decrease of $40,000 in lock box income. This was partially offset by an increase of $225,000 in other income and a $191,000 increase in service charges on deposit accounts. Other income increased primarily as a result of an increase in wealth management fees, merchant and charge card fees, and other customer fees. Also, service charges on deposit accounts increased primarily as a result of an increase in customer activity. Lockbox income decreased mainly as a result of decreased customer activity.

For the quarter ended June 30, 2017, operating expenses increased by $909,000 or 5.6% to $17,197,000, from the same period last year. The increase in operating expenses for the quarter was mainly attributable to an increase of $679,000 in salaries and employee benefits, $360,000 in other expenses, and $78,000 in equipment expenses. This was partially offset by a decrease in FDIC assessments of $152,000 and a decrease of $56,000 in occupancy expenses. Salaries and employee benefits increased mainly as a result of merit increases and increased bonus accruals. Equipment expenses increased primarily as a result of an increase in service contracts. Other expenses increased primarily as a result of an increase in marketing expenses and increased contributions. FDIC assessments decreased primarily as a result of a decrease in the assessment rate. Occupancy costs decreased primarily as a result of decreased rent expense associated with a reduction in rent for one branch.

Page 41 of 44

For the six months ended June 30, 2017, operating expenses increased by $2,952,000 or 9.2% to $34,922,000, from the same period last year. The increase in operating expenses for the six months was mainly attributable to an increase of $2,046,000 in salaries and employee benefits, $934,000 in other expenses, $148,000 in equipment expenses, and $106,000 in occupancy expenses. This was partially offset by a decrease in FDIC assessments of $282,000. Salaries and employee benefits increased mainly as a result of merit increases and increased bonus accruals. Occupancy cost increased primarily as a result of amortization of leasehold improvements and increased building maintenance costs associated with snow removal. Equipment expenses increased primarily as a result of an increase in service contracts. Other expenses increased primarily as a result of an increase in marketing expenses and increased contributions. FDIC assessments decreased primarily as a result of a decrease in the assessment rate.

Income Taxes

For the second quarter of 2017, the Company’s income tax expense totaled $552,000 on pretax income of $8,709,000 resulting in an effective tax rate of 6.3%. For last year’s corresponding quarter, the Company’s income tax expense totaled $20,000 on pretax income of $6,261,000 resulting in an effective tax rate of 0.3%. The increase in the effective income tax rate was primarily the result of an increase in taxable income.

For the six months ended June 30, 2017, the Company’s income tax expense totaled $696,000 on pretax income of $14,949,000 resulting in an effective tax rate of 4.7%. For last year’s corresponding period, the Company’s income tax expense totaled $84,000 on pretax income of $11,633,000 resulting in an effective tax rate of 0.7%. The increase in the effective income tax rate was primarily the result of an increase in taxable income.

Item 3. Quantitative and Qualitative Disclosure about Market Risk

Market risk is the risk of loss from adverse changes in market prices and rates. The Company’s market risk arises primarily from interest rate risk inherent in its lending and deposit taking activities. To that end, management actively monitors and manages its interest rate risk exposure. The Company’s profitability is affected by fluctuations in interest rates. A sudden and substantial increase or decrease in interest rates may adversely impact the Company’s earnings to the extent that the interest rates tied to specific assets and liabilities do not change at the same speed, to the same extent, or on the same basis. The Company monitors the impact of changes in interest rates on its net interest income using several tools. The Company’s primary objective in managing interest rate risk is to minimize the adverse impact of changes in interest rates on the Company’s net interest income and capital, while structuring the Company’s asset-liability structure to obtain the maximum yield-cost spread on that structure. Management believes that there has been no material changes in the interest rate risk reported in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016, filed with the Securities and Exchange Commission. The information is contained in the Form 10-K within the Market Risk and Asset Liability Management section of Management’s Discussion and Analysis of Results of Operations and Financial Condition.

Item 4. Controls and Procedures

The Company’s management, with participation of the Company’s principal executive and financial officers, has evaluated its disclosure controls and procedures as of the end of the period covered by this quarterly report. Based on this evaluation, the Company’s management, with participation of its principal executive and financial officers, has concluded that the Company’s disclosure controls and procedures are effective. The disclosure controls and procedures also effectively ensure that information required to be disclosed in the Company’s filings and submissions with the Securities and Exchange Commission under the Exchange Act is accumulated and reported to Company management (including the principal executive officer and the principal financial officer) as appropriate to allow timely decisions regarding required disclosure and is recorded, processed, summarized and reported within the time periods specified by the Securities and Exchange Commission. In addition, the Company has evaluated its internal control over financial reporting and during the second quarter of 2017 there were no changes that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

Page 42 of 44

Part II – Other Information

Item 1 Legal proceedings – At the present time, the Company is not engaged in any legal proceedings which, if adversely determined to the Company, would have a material adverse impact on the Company’s financial condition or results of operations. From time to time, the Company is party to routine legal proceedings within the normal course of business. Such routine legal proceedings, in the aggregate, are believed by management to be immaterial to the Company’s financial condition and results of operation.

Item 1A Risk Factors – Please read “Risk Factors” in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016. There have been no material changes since this 10-K was filed. These risks are not the only ones facing the Company. Additional risks and uncertainties not currently known to the Company or that the Company currently deems to be immaterial also may materially adversely affect the Company’s business, financial condition and operating results.

Item 2 Unregistered Sales of Equity Securities and Use of Proceeds –

(a) — (b) Not applicable.

(c) None

Item 3 Defaults Upon Senior Securities – None

Item 4 Mine Safety Disclosures – Not applicable

Item 5 Other Information – None

Item 6 Exhibits

31.1	Certification of President and Chief Executive Officer of the Company Pursuant to Securities Exchange Act Rules 13a-14 and 15d-14.
31.2	Certification of Chief Financial Officer of the Company Pursuant to Securities Exchange Act Rules 13a-14 and 15d-14.
+ 32.1	Certification of President and Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
+ 32.2	Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
+ + 101.	INS XBRL Instance Document
+ + 101.	SCH XBRL Taxonomy Extension Schema
+ + 101.	CAL XBRL Taxonomy Extension Calculation Linkbase
+ + 101.	LAB XBRL Taxonomy Extension Label Linkbase
+ + 101.	PRE XBRL Taxonomy Extension Presentation Linkbase
+ + 101.	DEF XBRL Taxonomy Definition Linkbase

+ This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that section, and shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934.

++ As provided in Rule 406T of regulation S-T, this information is filed for purposes of Sections 11 and 12 of the Securities Act of 1933 and Section 18 of the Securities Exchange Act of 1934 and consists of the following materials from Century Bancorp Inc.’s Quarterly Report on 10-Q for the quarter ended June 30, 2017, formatted in XBRL: (i) Consolidated Balance Sheets at June 30, 2017 and December 31, 2016; (ii) Consolidated Statements of Income for the six months ended June 30, 2017 and 2016; (iii) Consolidated Statements of Comprehensive Income for the six months ended June 30, 2017 and 2016; (iv) Consolidated Statements of Changes in Stockholders’ Equity for the six months ended June 30, 2017 and 2016; (v) Consolidated Statements of Cash Flows for the six months ended June 30, 2017 and 2016; and (vi) Notes to Unaudited Consolidated Interim Financial Statements.

Page 43 of 44

SIGNATURES

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

Date:	August 8, 2017	Century Bancorp, Inc.
/s/ Barry R. Sloane
Barry R. Sloane
President and Chief Executive Officer
/s/ William P. Hornby, CPA
William P. Hornby, CPA
Chief Financial Officer and Treasurer
(Principal Accounting Officer)

Page 44 of 44

EX-31.1

Exhibit 31.1

CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER OF THE COMPANY

PURSUANT TO SECURITIES EXCHANGE ACT RULES 13A-14 AND 15D-14

I, Barry R. Sloane, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Century Bancorp, Inc.;

2. Based on my knowledge, this quarterly 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 quarterly report;

3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the period presented in this quarterly 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 quarterly 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 quarterly report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this quarterly report based on such evaluation; and;

d. Disclosed in this quarterly report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter 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;

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 involve management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 8, 2017	/s/ Barry R. Sloane
	Barry R. Sloane
	President and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION OF THE CHIEF FINANCIAL OFFICER OF THE COMPANY

PURSUANT TO SECURITIES EXCHANGE ACT RULES 13A-14 AND 15D-14

I, William P. Hornby, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Century Bancorp, Inc.;

2. Based on my knowledge, this quarterly 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 quarterly report;

3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the period presented in this quarterly 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 quarterly 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 quarterly report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this quarterly report based on such evaluation; and;

d. Disclosed in this quarterly report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter 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;

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 involve management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 8, 2017	/s/ William P. Hornby
	William P. Hornby, CPA
	Chief Financial Officer and Treasurer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. Section 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Century Bancorp, Inc. (the “Company”) for the quarter ended June 30, 2017, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, certifies, to the best knowledge and belief of the signatory, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

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

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

/s/ Barry R. Sloane

Barry R. Sloane

President and Chief Executive Officer

Date: August 8, 2017

A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 or other document authenticating, acknowledging or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

The foregoing certification is being furnished solely pursuant to Subsections (a) and (b) of Section 1350 of Chapter 63 of Title 18 of the United States Code in accordance with Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that section, and shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934.

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. Section 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Century Bancorp, Inc. (the “Company”) for the quarter ended June 30, 2017, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, certifies, to the best knowledge and belief of the signatory, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

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

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

/s/ William P. Hornby

William P. Hornby, CPA

Chief Financial Officer and Treasurer

Date: August 8, 2017

A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 or other document authenticating, acknowledging or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

The foregoing certification is being furnished solely pursuant to Subsections (a) and (b) of Section 1350 of Chapter 63 of Title 18 of the United States Code in accordance with Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that section, and shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934.

XML

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2017	Jul. 31, 2017
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2017
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	Q2
Trading Symbol	CNBKA
Entity Registrant Name	CENTURY BANCORP INC
Entity Central Index Key	0000812348
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Class A Common Stock [Member]
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		3,603,729
Class B Common Stock [Member]
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		1,964,180

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Consolidated Balance Sheets (unaudited) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Assets
Cash and due from banks	$ 74,787	$ 62,400
Federal funds sold and interest-bearing deposits in other banks	153,374	173,751
Total cash and cash equivalents	228,161	236,151
Short-term investments		3,183
Securities available-for-sale, amortized cost $411,709 and $500,220, respectively	411,340	499,297
Securities held-to-maturity, fair value $1,706,840 and $ 1,635,808, respectively	1,722,875	1,653,986
Federal Home Loan Bank of Boston, stock at cost	25,588	21,042
Loans, net:
Construction and land development	14,159	14,928
Commercial and industrial	650,542	612,503
Municipal	127,259	135,418
Commercial real estate	736,603	696,173
Residential real estate	264,744	241,357
Home equity	229,274	211,857
Overdrafts	518	684
Total loans, net	2,033,799	1,923,933
Less: allowance for loan losses	25,289	24,406
Net loans	2,008,510	1,899,527
Bank premises and equipment	23,177	23,417
Accrued interest receivable	10,309	9,645
Goodwill	2,714	2,714
Other assets	116,563	113,646
Total assets	4,549,237	4,462,608
Deposits:
Demand deposits	687,219	689,286
Savings and NOW deposits	1,409,327	1,304,394
Money market accounts	897,241	1,181,179
Time deposits	575,410	478,359
Total deposits	3,569,197	3,653,218
Securities sold under agreements to repurchase	167,340	182,280
Other borrowed funds	455,500	293,000
Subordinated debentures	36,083	36,083
Due to broker	6,854
Other liabilities	59,638	57,986
Total liabilities	4,294,612	4,222,567
Stockholders' Equity
Preferred Stock - $1.00 par value; 100,000 shares authorized; no shares issued and outstanding
Additional paid-in capital	12,292	12,292
Retained earnings	256,718	243,565
Stockholders' equity before adjustment of accumulated other comprehensive income (loss)	274,578	261,425
Unrealized losses on securities available-for-sale, net of taxes	(234)	(567)
Unrealized losses on securities transferred to held-to-maturity, net of taxes	(3,451)	(4,084)
Pension liability, net of taxes	(16,268)	(16,733)
Total accumulated other comprehensive loss, net of taxes	(19,953)	(21,384)
Total stockholders' equity	254,625	240,041
Total liabilities and stockholders' equity	4,549,237	4,462,608
Consumer [Member]
Loans, net:
Consumer	10,700	11,013
Total loans, net	11,218	11,697
Less: allowance for loan losses	195	582
Class A Common Stock [Member]
Stockholders' Equity
Common stock value	3,604	3,601
Total stockholders' equity	3,604	3,601
Class B Common Stock [Member]
Stockholders' Equity
Common stock value	1,964	1,967
Total stockholders' equity	$ 1,964	$ 1,967

XML

Consolidated Balance Sheets (unaudited) (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Amortized cost	$ 411,709	$ 500,220
Held-to-maturity securities, fair value	$ 1,706,840	$ 1,635,808
Preferred stock, par value	$ 1.00	$ 1.00
Preferred stock, shares authorized	100,000	100,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Class A Common Stock [Member]
Common stock, par value	$ 1.00	$ 1.00
Common stock, shares authorized	10,000,000	10,000,000
Common stock, shares issued	3,603,729	3,600,729
Class B Common Stock [Member]
Common stock, par value	$ 1.00	$ 1.00
Common stock, shares authorized	5,000,000	5,000,000
Common stock, shares issued	1,964,180	1,967,180

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Consolidated Statements of Income (unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Interest income
Loans	$ 16,910	$ 14,163	$ 32,010	$ 28,335
Securities held-to-maturity	9,824	8,128	19,359	15,940
Securities available-for-sale	1,723	1,143	3,334	2,107
Federal funds sold and interest-bearing deposits in other banks	349	308	742	623
Total interest income	28,806	23,742	55,445	47,005
Interest expense
Savings and NOW deposits	1,500	938	2,727	1,776
Money market accounts	1,234	781	2,508	1,576
Time deposits	1,902	1,394	3,553	2,752
Securities sold under agreements to repurchase	120	126	223	241
Other borrowed funds and subordinated debentures	1,945	2,247	3,873	4,554
Total interest expense	6,701	5,486	12,884	10,899
Net interest income	22,105	18,256	42,561	36,106
Provision for loan losses	490	350	890	800
Net interest income after provision for loan losses	21,615	17,906	41,671	35,306
Other operating income
Service charges on deposit accounts	2,074	1,962	4,090	3,899
Lockbox fees	861	883	1,632	1,672
Net gains on sales of securities		45		45
Gains on sales of mortgage loans	269	798	370	798
Other income	1,087	955	2,108	1,883
Total other operating income	4,291	4,643	8,200	8,297
Operating expenses
Salaries and employee benefits	10,719	10,040	21,862	19,816
Occupancy	1,495	1,551	3,236	3,130
Equipment	757	679	1,463	1,315
FDIC assessments	440	592	878	1,160
Other	3,786	3,426	7,483	6,549
Total operating expenses	17,197	16,288	34,922	31,970
Income before income taxes	8,709	6,261	14,949	11,633
Provision for income taxes	552	20	696	84
Net income	$ 8,157	$ 6,241	$ 14,253	$ 11,549
Class A Common Stock [Member]
Share data:
Weighted average number of shares outstanding, basic	3,603,729	3,600,729	3,602,229	3,600,729
Weighted average number of shares outstanding, diluted	5,567,909	5,567,909	5,567,909	5,567,909
Basic earnings per share	$ 1.78	$ 1.36	$ 3.11	$ 2.52
Diluted earnings per share	$ 1.47	$ 1.12	$ 2.56	$ 2.07
Class B Common Stock [Member]
Share data:
Weighted average number of shares outstanding, basic	1,964,180	1,967,180	1,965,680	1,967,180
Weighted average number of shares outstanding, diluted	1,964,180	1,967,180	1,965,680	1,967,180
Basic earnings per share	$ 0.89	$ 0.68	$ 1.55	$ 1.26
Diluted earnings per share	$ 0.89	$ 0.68	$ 1.55	$ 1.26

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Consolidated Statements of Comprehensive Income (unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Statement of Comprehensive Income [Abstract]
Net income	$ 8,157	$ 6,241	$ 14,253	$ 11,549
Unrealized gains (losses) on securities:
Unrealized (losses) gains arising during period	198	(325)	333	(11)
Less: reclassification adjustment for gains included in net income		(27)		(27)
Total unrealized (losses) gains on securities	198	(352)	333	(38)
Accretion of net unrealized losses transferred	260	762	633	1,747
Defined benefit pension plans:
Amortization of prior service cost and loss included in net periodic benefit cost	233	243	465	485
Other comprehensive income	691	653	1,431	2,194
Comprehensive income	$ 8,848	$ 6,894	$ 15,684	$ 13,743

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Consolidated Statements of Changes in Stockholders' Equity (unaudited) - USD ($) $ in Thousands	Total	Class A Common Stock [Member]	Class B Common Stock [Member]	Additional Paid-In Capital [Member]	Retained Earnings [Member]	Retained Earnings [Member] Class A Common Stock [Member]	Retained Earnings [Member] Class B Common Stock [Member]	Accumulated Other Comprehensive Income (Loss) [Member]
Beginning balance at Dec. 31, 2015	$ 214,544	$ 3,601	$ 1,967	$ 12,292	$ 221,232			$ (24,548)
Net income	11,549				11,549
Other comprehensive income, net of tax:
Unrealized holding (losses) gains arising during period, net of taxes	(38)							(38)
Accretion of unrealized losses on securities transferred to held-to-maturity, net of taxes	1,747							1,747
Pension liability adjustment, net of taxes	485							485
Cash dividends						$ (866)	$ (235)
Ending balance at Jun. 30, 2016	227,186	3,601	1,967	12,292	231,680			(22,354)
Beginning balance at Dec. 31, 2016	240,041	3,601	1,967	12,292	243,565			(21,384)
Net income	14,253				14,253
Other comprehensive income, net of tax:
Unrealized holding (losses) gains arising during period, net of taxes	333							333
Accretion of unrealized losses on securities transferred to held-to-maturity, net of taxes	633							633
Pension liability adjustment, net of taxes	465							465
Conversion of Class B Common Stock to Class A Common Stock		3	(3)
Cash dividends						$ (865)	$ (235)
Ending balance at Jun. 30, 2017	$ 254,625	$ 3,604	$ 1,964	$ 12,292	$ 256,718			$ (19,953)

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Consolidated Statements of Changes in Stockholders' Equity (unaudited) (Parenthetical) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Unrealized holding (losses) gains arising during period, taxes	$ 221	$ 61
Realized net gains		45
Accretion of net unrealized losses transferred during the period, taxes	690	935
Pension liability adjustment, taxes	$ 311	$ 322
Class A Common Stock [Member]
Conversion of Class B Common Stock to Class A Common Stock, shares	3,000
Cash dividends, per share	$ 0.24	$ 0.24
Class B Common Stock [Member]
Conversion of Class B Common Stock to Class A Common Stock, shares	3,000
Cash dividends, per share	$ 0.12	$ 0.12

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Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 14,253	$ 11,549
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Gain on sales of mortgage loans	(370)	(798)
Net gains on sales of securities		(45)
Provision for loan losses	890	800
Deferred income taxes	(1,579)	(1,792)
Net depreciation and amortization	1,660	1,575
Decrease in accrued interest receivable	(664)	(712)
Increase in other assets	(2,593)	(3,428)
Increase in other liabilities	2,426	1,069
Net cash provided by operating activities	14,023	8,218
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of short-term investments		(8)
Maturities of short-term investments	3,183
Proceeds from redemptions of Federal Home Loan Bank of Boston stock	714	4,898
Purchase of Federal Home Loan Bank of Boston stock	(5,260)	(2,177)
Proceeds from calls/maturities of securities available-for-sale	166,976	130,513
Proceeds from sales of securities available-for-sale	0	1,946
Purchase of securities available-for-sale	(71,793)	(287,834)
Proceeds from calls/maturities of securities held-to-maturity	153,405	213,337
Proceeds from sales of securities held-to-maturity	0	192
Purchase of securities held-to-maturity	(220,832)	(345,692)
Net increase in loans	(136,181)	(132,182)
Proceeds from sales of portfolio loans	26,701	50,220
Capital expenditures	(1,365)	(835)
Net cash used in investing activities	(84,452)	(367,622)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase (decrease) in time deposits	97,051	(12,899)
Net (decrease) increase in demand, savings, money market and NOW deposits	(181,072)	156,771
Cash dividends	(1,100)	(1,101)
Net (decrease) increase in securities sold under agreements to repurchase	(14,940)	19,915
Net increase in other borrowed funds	162,500	63,000
Net cash provided by financing activities	62,439	225,686
Net decrease in cash and cash equivalents	(7,990)	(133,718)
Cash and cash equivalents at beginning of period	236,151	220,724
Cash and cash equivalents at end of period	228,161	87,006
Cash paid during the period for:
Interest	12,997	10,893
Income taxes	2,980	2,110
Change in unrealized gains (losses) on securities available-for-sale, net of taxes	333	(38)
Change in unrealized losses on securities transferred to held-to-maturity, net of taxes	633	1,747
Pension liability adjustment, net of taxes	465	485
Change in due to (from) to broker	$ 6,854	3,180
Transfer of loans to loans held-for-sale		$ 12,403

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Basis of Financial Statement Presentation

6 Months Ended

Jun. 30, 2017

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Financial Statement Presentation

Note 1. Basis of Financial Statement Presentation

The consolidated financial statements include the accounts of Century Bancorp, Inc. (the “Company”) and its wholly owned subsidiary, Century Bank and Trust Company (the “Bank”). The consolidated financial statements also include the accounts of the Bank’s wholly owned subsidiaries, Century Subsidiary Investments, Inc. (“CSII”), Century Subsidiary Investments, Inc. II (“CSII II”), Century Subsidiary Investments, Inc. III (“CSII III”) and Century Financial Services Inc. (“CFSI”). CSII, CSII II, and CSII III are engaged in buying, selling and holding investment securities. CFSI has the power to engage in financial agency, securities brokerage, and investment and financial advisory services and related securities credit. The Company also owns 100% of Century Bancorp Capital Trust II (“CBCT II”). The entity is an unconsolidated subsidiary of the Company.

All significant intercompany accounts and transactions have been eliminated in consolidation. The Company provides a full range of banking services to individual, business and municipal customers in Massachusetts, New Hampshire, Rhode Island, Connecticut, and New York. As a bank holding company, the Company is subject to the regulation and supervision of the Federal Reserve Board. The Bank, a state chartered financial institution, is subject to supervision and regulation by applicable state and federal banking agencies, including the Federal Reserve Board, the Federal Deposit Insurance Corporation (the “FDIC”) and the Commonwealth of Massachusetts Commissioner of Banks. The Bank is also subject to various requirements and restrictions under federal and state law, including requirements to maintain reserves against deposits, restrictions on the types and amounts of loans that may be granted and the interest that may be charged thereon, and limitations on the types of investments that may be made and the types of services that may be offered. Various consumer laws and regulations also affect the operations of the Bank. In addition to the impact of regulation, commercial banks are affected significantly by the actions of the Federal Reserve Board as it attempts to control the money supply and credit availability in order to influence the economy. All aspects of the Company’s business are highly competitive. The Company faces aggressive competition from other lending institutions and from numerous other providers of financial services. The Company has one reportable operating segment.

The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America and general practices within the banking industry. In preparing the financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the balance sheet and revenues and expenses for the period. Actual results could differ from those estimates. The Company’s quarterly report on Form 10-Q should be read in conjunction with the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016, as filed with the Securities and Exchange Commission.

Material estimates that are susceptible to change in the near term relate to the allowance for loan losses. Management believes that the allowance for loan losses is adequate based on independent appraisals and review of other factors, including historical charge-off rates with additional allocations based on risk factors for each category and general economic factors. While management uses available information to recognize loan losses, future additions to the allowance for loan losses may be necessary based on changes in economic conditions. In addition, regulatory agencies periodically review the Company’s allowance for loan losses. Such agencies may require the Company to recognize additions to the allowance for loan losses based on their judgments about information available to them at the time of their examination. Certain reclassifications are made to prior-year amounts whenever necessary to conform with the current-year presentation.

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Securities Available-for-Sale

6 Months Ended

Jun. 30, 2017

Text Block [Abstract]

Securities Available-for-Sale

Note 2. Securities Available-for-Sale

	June 30, 2017								December 31, 2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(in thousands)
U.S. Treasury	$	1,999	$	—	$	4	$	1,995	$	2,000	$	—	$	—	$	2,000
U.S. Government Sponsored Enterprises		10,000		—		—		10,000		25,000		—		48		24,952
SBA Backed Securities		71,357		27		195		71,189		57,899		14		146		57,767
U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities		223,655		463		336		223,782		243,703		293		671		243,325
Privately Issued Residential Mortgage-Backed Securities		1,025		3		13		1,015		1,121		2		14		1,109
Obligations Issued by States and Political Subdivisions		98,457		—		408		98,049		165,281		—		405		164,876
Other Debt Securities		5,100		85		193		4,992		5,100		18		194		4,924
Equity Securities		116		202		—		318		116		228		—		344
Total	$	411,709	$	780	$	1,149	$	411,340	$	500,220	$	555	$	1,478	$	499,297

Included in SBA Backed Securities and U.S. Government Sponsored Enterprise Securities and U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities are securities at fair value pledged to secure public deposits and repurchase agreements amounting to $ 173,235,000 and $210,780,000 at June 30, 2017 and December 31, 2016, respectively. Also included in securities available-for-sale are securities at fair value pledged for borrowing at the Federal Home Loan Bank of Boston amounting to $49,416,000 and $53,396,000 at June 30, 2017 and December 31, 2016, respectively. There were no sales of available-for-sale securities for the six months ended June 30, 2017. The Company realized gross gains of $33,000 from the proceeds of $1,946,000 from the sales of available-for-sales securities for the six months ended June 30, 2016.

Debt securities of U.S. Government Sponsored Enterprises and U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities primarily refer to debt securities of Fannie Mae and Freddie Mac.

The following table shows the maturity distribution of the Company’s securities available-for-sale at June 30, 2017.

	Amortized Cost		Fair Value
	(in thousands)
Within one year	$	90,264	$	90,255
After one but within five years		132,716		132,786
After five but within ten years		105,344		105,360
More than 10 years		81,769		81,270
Non-maturing		1,616		1,669
Total	$	411,709	$	411,340

The weighted average remaining life of investment securities available-for-sale at June 30, 2017 was 5.4 years. Included in the weighted average remaining life calculation at June 30, 2017 were $10,000,000 of U.S. Government Sponsored Enterprises obligations that are callable at the discretion of the issuer. The contractual maturities, which were used in the table above, of mortgage-backed securities, will differ from the actual maturities, due to the ability of the issuers to prepay underlying obligations.

As of June 30, 2017 and December 31, 2016, management concluded that the unrealized losses of its investment securities are temporary in nature since they are not related to the underlying credit quality of the issuers, and the Company does not intend to sell these debt securities and it is not more likely than not that it will be required to sell these debt securities before the anticipated recovery of its remaining amortized cost. In making its other-than-temporary impairment evaluation, the Company considered that the principal and interest on these securities are from issuers that are investment grade.

The unrealized loss on SBA Backed Securities, U.S. Government Agency and Sponsored Enterprise Mortgage Backed Securities, Obligations Issued by States and Political Subdivisions, and Other Debt Securities, related primarily to interest rates and not credit quality, and because the Company has the ability and intent to hold these investments until recovery of fair value, which may be maturity, the Company does not consider these investments to be other-than-temporarily impaired.

In evaluating the underlying credit quality of a security, management considers several factors such as the credit rating of the obligor and the issuer, if applicable. Internal reviews of issuer financial statements are performed as deemed necessary. In the case of privately issued mortgage-backed securities, the performance of the underlying loans is analyzed as deemed necessary to determine the estimated future cash flows of the securities. Factors considered include the level of subordination, current and estimated future default rates, current and estimated prepayment rates, estimated loss severity rates, geographic concentrations and origination dates of underlying loans. In the case of marketable equity securities, the severity of the unrealized loss, the length of time the unrealized loss has existed, and the issuer’s financial performance are considered.

The following table shows the temporarily impaired securities of the Company’s available-for-sale portfolio at June 30, 2017. This table shows the unrealized market loss of securities that have been in a continuous unrealized loss position for less than 12 months and a continuous loss position for 12 months or longer. There are 13 and 27 securities that are temporarily impaired for less than 12 months and for 12 months or longer, respectively, out of a total of 269 holdings at June 30, 2017.

	June 30, 2017
	Less than 12 months				12 months or longer				Total
Temporarily Impaired Investments	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(in thousands)
U.S. Treasury	$	1,995	$	4	$	—	$	—	$	1,995	$	4
U.S. Government Sponsored Enterprises		—		—		—		—		—		—
SBA Backed Securities		27,850		116		17,775		79		45,625		195
U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities		36,251		83		66,121		253		102,372		336
Privately Issued Residential Mortgage-Backed Securities		—		—		707		13		707		13
Obligations Issued by States and Political Subdivisions		—		—		4,297		408		4,297		408
Other Debt Securities		—		—		1,907		193		1,907		193
Total temporarily impaired securities	$	66,096	$	203	$	90,807	$	946	$	156,903	$	1,149

The following table shows the temporarily impaired securities of the Company’s available-for-sale portfolio at December 31, 2016. This table shows the unrealized market loss of securities that have been in a continuous unrealized loss position for less than 12 months and a continuous loss position for 12 months or longer. There are 49 and 15 securities that are temporarily impaired for less than 12 months and for 12 months or longer, respectively, out of a total of 270 holdings at December 31, 2016.

Temporarily Impaired Investments	December 31, 2016
	Less than 12 months				12 months or longer				Total
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(in thousands)
U.S. Government Sponsored Enterprises	$	24,952	$	48	$	—	$	—	$	24,952	$	48
SBA Backed Securities		52,346		145		951		1		53,297		146
U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities		135,612		485		31,504		186		167,116		671
Privately Issued Residential Mortgage-Backed Securities		—		—		757		14		757		14
Obligations Issued by States and Political Subdivisions		—		—		4,298		405		4,298		405
Other Debt Securities		453		47		1,553		147		2,006		194
Total temporarily impaired securities	$	213,363	$	725	$	39,063	$	753	$	252,426	$	1,478

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Investment Securities Held-to-Maturity

6 Months Ended

Jun. 30, 2017

Text Block [Abstract]

Investment Securities Held-to-Maturity

Note 3. Investment Securities Held-to-Maturity

	June 30, 2017								December 31, 2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
	(in thousands)
U.S. Government Sponsored Enterprises	$	134,378	$	931	$	287	$	135,022	$	148,326	$	1,066	$	527	$	148,865
SBA Backed Securities		54,427		3		779		53,651		46,140		—		1,088		45,052
U.S. Government Agency and Sponsored Enterprises Mortgage-Backed Securities		1,534,070		5,419		21,322		1,518,167		1,459,520		4,948		22,577		1,441,891
Total	$	1,722,875	$	6,353	$	22,388	$	1,706,840	$	1,653,986	$	6,014	$	24,192	$	1,635,808

Included in U.S. Government and Agency Securities are securities pledged to secure public deposits and repurchase agreements at fair value amounting to $1,268,349,000 and $1,147,207,000 at June 30, 2017 and December 31, 2016, respectively. Also included are securities pledged for borrowing at the Federal Home Loan Bank of Boston at fair value amounting to $305,269,000 and $424,353,000 at June 30, 2017 and December 31, 2016, respectively. There were no sales of held-to-maturity securities for the six months ended June 30, 2017. The Company realized gross gains of $12,000 from the proceeds of $192,000 from the sales of securities held-to-maturity for the six months ended June 30, 2016. The sales of securities held-to-maturity relate to certain mortgage backed securities for which the Company had previously collected a substantial portion of its principal investment.

At June 30, 2017 and December 31, 2016, all mortgage-backed securities are obligations of U.S. Government Agencies and Government Sponsored Enterprises. Debt securities of U.S. Government Sponsored Enterprises and U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities primarily refer to debt securities of Fannie Mae and Freddie Mac.

The following table shows the maturity distribution of the Company’s securities held-to-maturity at June 30, 2017.

	Amortized Cost		Fair Value
	(in thousands)
Within one year	$	45,780	$	45,827
After one but within five years		1,224,104		1,213,863
After five but within ten years		449,698		444,027
More than ten years		3,293		3,123
Total	$	1,722,875	$	1,706,840

The weighted average remaining life of investment securities held-to-maturity at June 30, 2017 was 4.4 years. Included in the weighted average remaining life calculation at June 30, 2017 were $35,496,000 of U.S. Government Sponsored Enterprises obligations that are callable at the discretion of the issuer. The actual maturities, which were used in the table above, of mortgage-backed securities, will differ from the contractual maturities, due to the ability of the issuers to prepay underlying obligations.

As of June 30, 2017 and December 31, 2016, management concluded that the unrealized losses of its investment securities are temporary in nature since they are not related to the underlying credit quality of the issuers, and the Company does not intend to sell these debt securities and it is not likely that it will be required to sell these debt securities before the anticipated recovery of their remaining amortized costs. In making its other-than-temporary impairment evaluation, the Company considered the fact that the principal and interest on these securities are from issuers that are investment grade.

The unrealized loss on U.S. Government Sponsored Enterprises, SBA Backed Securities, and U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities related primarily to interest rates and not credit quality, and because the Company does not intend to sell any of these securities and it is not likely that it will be required to sell these securities before the anticipated recovery of the remaining amortized cost, the Company does not consider these investments to be other-than-temporarily impaired June 30, 2017 and December 31, 2016.

In evaluating the underlying credit quality of a security, management considers several factors such as the credit rating of the obligor and the issuer, if applicable. Internal reviews of issuer financial statements are performed as deemed necessary.

The following table shows the temporarily impaired securities of the Company’s held-to-maturity portfolio at June 30, 2017. This table shows the unrealized market loss of securities that have been in a continuous unrealized loss position for 12 months or less and a continuous loss position for 12 months or longer. There are 190 and 22 securities that are temporarily impaired for less than 12 months and for 12 months or longer, respectively, out of a total of 393 holdings at June 30, 2017.

	June 30, 2017
	Less Than 12 Months				12 Months or Longer				Total
Temporarily Impaired Investments	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(in thousands)
U.S. Government Sponsored Enterprises	$	45,209	$	287	$	—	$	—	$	45,209	$	287
SBA Backed Securities		50,633		779		—		—		50,633		779
U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities		1,015,890		18,964		76,584		2,358		1,092,474		21,322
Total temporarily impaired securities	$	1,111,732	$	20,030	$	76,584	$	2,358	$	1,188,316	$	22,388

The following table shows the temporarily impaired securities of the Company’s held-to-maturity portfolio at December 31, 2016. This table shows the unrealized market loss of securities that have been in a continuous unrealized loss position for less than 12 months and a continuous loss position for 12 months or longer. There are 194 and 16 securities that are temporarily impaired for less than 12 months and for 12 months or longer, respectively, out of a total of 375 holdings at December 31, 2016.

	December 31, 2016
	Less Than 12 Months				12 Months or Longer				Total
Temporarily Impaired Investments	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(in thousands)
U.S. Government Sponsored Enterprises	$	59,219	$	527	$	—	$	—	$	59,219	$	527
SBA Backed Securities		45,052		1,088		—		—		45,052		1,088
U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities		1,008,960		20,725		58,535		1,852		1,067,495		22,577
Total temporarily impaired securities	$	1,113,231	$	22,340	$	58,535	$	1,852	$	1,171,766	$	24,192

XML

Allowance for Loan Losses

6 Months Ended

Jun. 30, 2017

Receivables [Abstract]

Allowance for Loan Losses

Note 4. Allowance for Loan Losses

The Company maintains an allowance for loan losses in an amount determined by management on the basis of the character of the loans, loan performance, financial condition of borrowers, the value of collateral securing loans and other relevant factors.

The following table summarizes the changes in the Company’s allowance for loan losses for the periods indicated.

	Three months ended June 30,						Six months ended June 30,
	2017			2016			2017			2016
	(in thousands)
Allowance for loan losses, beginning of period	$	24,827		$	23,544		$	24,406		$	23,075
Adjustment		—			(84	)		—			(84	)
Loans charged off		(100	)		(111	)		(197	)		(180	)
Recoveries on loans previously charged-off		72			164			190			252
Net (charge-offs) / recoveries		(28	)		53			(7	)		72
Provision charged to expense		490			350			890			800
Allowance for loan losses, end of period	$	25,289		$	23,863		$	25,289		$	23,863

Further information pertaining to the allowance for loan losses for the three months ending June 30, 2017 follows:

	Construction and Land Development		Commercial and Industrial			Municipal			Commercial Real Estate			Residential Real Estate		Consumer			Home Equity		Unallocated			Total
	(in thousands)
Allowance for loan losses:
Balance at March 31, 2017	$	873	$	7,369		$	1,899		$	11,216		$	1,671	$	452		$	1,050	$	297		$	24,827
Charge-offs		—		(29	)		—			—			—		(71	)		—		—			(100	)
Recoveries		—		34			—			—			—		38			—		—			72
Provision		264		189			(40	)		(188	)		447		(224	)		96		(54	)		490
Ending balance at June 30, 2017	$	1,137	$	7,563		$	1,859		$	11,028		$	2,118	$	195		$	1,146	$	243		$	25,289
Amount of allowance for loan losses for loans deemed to be impaired	$	—	$	11		$	—		$	120		$	69	$	—		$	—	$	—		$	200
Amount of allowance for loan losses for loans not deemed to be impaired	$	1,137	$	7,552		$	1,859		$	10,908		$	2,049	$	195		$	1,146	$	243		$	25,089
Loans:
Ending balance	$	14,159	$	650,542		$	127,259		$	736,603		$	264,744	$	11,218		$	229,274	$	—		$	2,033,799
Loans deemed to be impaired	$	—	$	365		$	—		$	2,603		$	4,343	$	—		$	—	$	—		$	7,311
Loans not deemed to be impaired	$	14,159	$	650,177		$	127,259		$	734,000		$	260,401	$	11,218		$	229,274	$	—		$	2,026,488

Further information pertaining to the allowance for loan losses for the six months ending June 30, 2017 follows:

	Construction and Land Development		Commercial and Industrial			Municipal		Commercial Real Estate			Residential Real Estate		Consumer			Home Equity		Unallocated			Total
	(in thousands)
Allowance for loan losses:
Balance at December 31, 2016	$	1,012	$	6,972		$	1,612	$	11,135		$	1,698	$	582		$	1,102	$	293		$	24,406
Charge-offs		—		(29	)		—		—			—		(168	)		—		—			(197	)
Recoveries		—		54			—		—			2		134			—		—			190
Provision		125		566			247		(107	)		418		(353	)		44		(50	)		890
Ending balance at June 30, 2017	$	1,137	$	7,563		$	1,859	$	11,028		$	2,118	$	195		$	1,146	$	243		$	25,289
Amount of allowance for loan losses for loans deemed to be impaired	$	—	$	11		$	—	$	120		$	69	$	—		$	—	$	—		$	200
Amount of allowance for loan losses for loans not deemed to be impaired	$	1,137	$	7,552		$	1,859	$	10,908		$	2,049	$	195		$	1,146	$	243		$	25,089
Loans:
Ending balance	$	14,159	$	650,542		$	127,259	$	736,603		$	264,744	$	11,218		$	229,274	$	—		$	2,033,799
Loans deemed to be impaired	$	—	$	365		$	—	$	2,603		$	4,343	$	—		$	—	$	—		$	7,311
Loans not deemed to be impaired	$	14,159	$	650,177		$	127,259	$	734,000		$	260,401	$	11,218		$	229,274	$	—		$	2,026,488

During the six months ending June 30, 2017, the Company’s provision was primarily attributable to an increase in commercial and industrial and residential real estate balances offset, somewhat, by changes in historical loss and qualitative factors. During the three months ending June 30, 2017 the Company’s provision was primarily attributable to an increase in residential real estate loan balances offset, somewhat, by changes in historical loss and qualitative factors. There was also an increase in commercial and industrial originations, which increased the commercial and industrial allocation and lower historical loss rate, which decreased the consumer allocations.

Further information pertaining to the allowance for loan losses for the three months ending June 30, 2016 follows:

	Construction and Land Development			Commercial and Industrial			Municipal		Commercial Real Estate			Residential Real Estate			Consumer			Home Equity			Unallocated		Total
	(in thousands)
Allowance for loan losses:
Balance at March 31, 2016	$	1,973		$	6,693		$	990	$	10,533		$	1,249		$	693		$	1,185		$	228	$	23,544
Charge-offs		—			—			—		—			—			(111	)		—			—		(111	)
Recoveries		—			56			—		—			2			106			—			—		164
Provision		264			(878	)		811		128			53			(77	)		9			40		350
Reclassification to other liabilities		(3	)		(29	)		—		(11	)		(2	)		(3	)		(36	)		—		(84	)
Ending balance at June 30, 2016	$	2,234		$	5,842		$	1,801	$	10,650		$	1,302		$	608		$	1,158		$	268	$	23,863
Amount of allowance for loan losses for loans deemed to be impaired	$	6		$	10		$	—	$	151		$	7		$	—		$	—		$	—	$	174
Amount of allowance for loan losses for loans not deemed to be impaired	$	2,228		$	5,832		$	1,801	$	10,499		$	1,295		$	608		$	1,158		$	268	$	23,689
Loans:
Ending balance	$	31,178		$	493,033		$	134,386	$	728,658		$	219,494		$	11,339		$	183,816		$	—	$	1,801,904
Loans deemed to be impaired	$	96		$	410		$	—	$	3,736		$	215		$	—		$	—		$	—	$	4,457
Loans not deemed to be impaired	$	31,082		$	492,623		$	134,386	$	724,922		$	219,279		$	11,339		$	183,816		$	—	$	1,797,447

Further information pertaining to the allowance for loan losses for the six months ending June 30, 2016 follows:

	Construction and Land Development			Commercial and Industrial			Municipal		Commercial Real Estate			Residential Real Estate			Consumer			Home Equity			Unallocated			Total
	(in thousands)
Allowance for loan losses:
Balance at December 31, 2015	$	2,041		$	5,899		$	994	$	10,589		$	1,320		$	644		$	1,077		$	511		$	23,075
Charge-offs		—			—			—		—			—			(180	)		—			—			(180	)
Recoveries		—			91			—		—			3			158			—			—			252
Provision		196			(119	)		807		72			(19	)		(11	)		117			(243	)		800
Reclassification to other liabilities		(3	)		(29	)		—		(11	)		(2	)		(3	)		(36	)		—			(84	)
Ending balance at June 30, 2016	$	2,234		$	5,842		$	1,801	$	10,650		$	1,302		$	608		$	1,158		$	268		$	23,863
Amount of allowance for loan losses for loans deemed to be impaired	$	6		$	10		$	—	$	151		$	7		$	—		$	—		$	—		$	174
Amount of allowance for loan losses for loans not deemed to be impaired	$	2,228		$	5,832		$	1,801	$	10,499		$	1,295		$	608		$	1,158		$	268		$	23,689
Loans:
Ending balance	$	31,178		$	493,033		$	134,386	$	728,658		$	219,494		$	11,339		$	183,816		$	—		$	1,801,904
Loans deemed to be impaired	$	96		$	410		$	—	$	3,736		$	215		$	—		$	—		$	—		$	4,457
Loans not deemed to be impaired	$	31,082		$	492,623		$	134,386	$	724,922		$	219,279		$	11,339		$	183,816		$	—		$	1,797,447

During the six months ending June 30, 2016, the Company’s provision was primarily attributable to an increase in municipal balances. During the three months ending June 30, 2016 the Company’s provision was primarily attributable to an increase in construction loan balances. There was also an increase in municipal originations, which increased the municipal allocation and commercial and industrial loan payoffs, which decreased the commercial and industrial allocations.

The Company utilizes a six grade internal loan rating system for commercial real estate, construction and commercial loans as follows:

Loans rated 1-3 (Pass):

Loans in this category are considered “pass” rated loans with low to average risk.

Loans rated 4 (Monitor):

These loans represent classified loans that management is closely monitoring for credit quality. These loans have had or may have minor credit quality deterioration as of June 30, 2017 and December 31, 2016.

Loans rated 5 (Substandard):

Substandard loans represent classified loans that management is closely monitoring for credit quality. These loans have had more significant credit quality deterioration as of June 30, 2017 and December 31, 2016.

Loans rated 6 (Doubtful):

Doubtful loans represent classified loans that management is closely monitoring for credit quality. These loans had more significant credit quality deterioration as of June 30, 2017 and December 31, 2016 and are doubtful for full collection.

Impaired:

Impaired loans represent classified loans that management is closely monitoring for credit quality. A loan is classified as impaired when it is probable that the Company will be unable to collect all amounts due.

The following table presents the Company’s loans by risk rating at June 30, 2017.

	Construction and Land Development		Commercial and Industrial		Municipal		Commercial Real Estate
	(in thousands)
Grade:
1-3 (Pass)	$	14,159	$	650,177	$	127,259	$	704,531
4 (Monitor)		—		—		—		29,469
5 (Substandard)		—		—		—		—
6 (Doubtful)		—		—		—		—
Impaired		—		365		—		2,603
Total	$	14,159	$	650,542	$	127,259	$	736,603

The following table presents the Company’s loans by risk rating at December 31, 2016.

	Construction and Land Development		Commercial and Industrial		Municipal		Commercial Real Estate
	(in thousands)
Grade:
1-3 (Pass)	$	14,834	$	612,114	$	135,418	$	661,271
4 (Monitor)		—		—		—		31,753
5 (Substandard)		—		—		—		—
6 (Doubtful)		—		—		—		—
Impaired		94		389		—		3,149
Total	$	14,928	$	612,503	$	135,418	$	696,173

The Company has increased its exposure to larger loans to large institutions with publically available credit ratings beginning in 2015. These ratings are tracked as a credit quality indicator for these loans. Credit ratings issued by national organizations were utilized as credit quality indicators as presented in the following table at June 30, 2017 and are included within the total loan portfolio.

	Commercial and Industrial		Municipal		Commercial Real Estate		Total
	(in thousands)
Credit Rating:
Aaa – Aa3	$	341,777	$	66,484	$	45,615	$	453,876
A1 – A3		218,222		8,225		128,927		355,374
Baa1 – Baa3		—		46,970		125,775		172,745
Ba2		—		2,730		—		2,730
Total	$	559,999	$	124,409	$	300,317	$	984,725

Credit ratings issued by national organizations were utilized as credit quality indicators as presented in the following table at December 31, 2016.

	Commercial and Industrial		Municipal		Commercial Real Estate		Total
	(in thousands)
Credit Rating:
Aaa – Aa3	$	334,674	$	66,245	$	6,596	$	407,515
A1 – A3		188,777		33,365		129,423		351,565
Baa1 – Baa3		—		26,970		127,366		154,336
Ba2		—		3,610		—		3,610
Total	$	523,451	$	130,190	$	263,385	$	917,026

The Company utilized payment performance as credit quality indicators for the loan types listed below. The indicators are depicted in the table “aging of past due loans,” below.

Further information pertaining to the allowance for loan losses at June 30, 2017 follows:

	Accruing 30-89 Days Past Due		Non Accrual		Accruing Greater than 90 Days		Total Past Due		Current Loans		Total
	(in thousands)
Construction and land development	$	—	$	—	$	—	$	—	$	14,159	$	14,159
Commercial and industrial		404		49		—		453		650,089		650,542
Municipal		—		—		—		—		127,259		127,259
Commercial real estate		455		230		—		685		735,918		736,603
Residential real estate		984		735		—		1,719		263,025		264,744
Consumer and overdrafts		6		1		—		7		11,211		11,218
Home equity		1,357		107		—		1,464		227,810		229,274
Total	$	3,206	$	1,122	$	—	$	4,328	$	2,029,471	$	2,033,799

Further information pertaining to the allowance for loan losses at December 31, 2016 follows:

	Accruing 30-89 Days Past Due		Non Accrual		Accruing Greater than 90 Days		Total Past Due		Current Loans		Total
	(in thousands)
Construction and land development	$	—	$	94	$	—	$	94	$	14,834	$	14,928
Commercial and industrial		37		65		—		102		612,401		612,503
Municipal		—		—		—		—		135,418		135,418
Commercial real estate		597		150		—		747		695,426		696,173
Residential real estate		245		656		—		901		240,456		241,357
Consumer and overdrafts		—		11		—		11		11,686		11,697
Home equity		735		108		—		843		211,014		211,857
Total	$	1,614	$	1,084	$	—	$	2,698	$	1,921,235	$	1,923,933

A loan is impaired when, based on current information and events, it is probable that a creditor will be unable to collect all amounts due according to the contractual terms of the loan agreement. When a loan is impaired, the Company measures impairment based on the present value of expected future cash flows discounted at the loan’s effective interest rate, except that as a practical expedient, the Company measures impairment based on a loan’s observable market price or the fair value of the collateral if the loan is collateral dependent. Loans are charged-off when management believes that the collectability of the loan’s principal is not probable. The specific factors that management considers in making the determination that the collectability of the loan’s principal is not probable include: the delinquency status of the loan, the fair value of the collateral, if secured, and the financial strength of the borrower and/or guarantors. For collateral dependent loans, the amount of the recorded investment in a loan that exceeds the fair value of the collateral is charged-off against the allowance for loan losses in lieu of an allocation of a specific allowance amount when such an amount has been identified definitively as uncollectible. The Company’s policy for recognizing interest income on impaired loans is contained within Note 1 of the consolidated financial statements contained in the Company’s Annual Report for the fiscal year ended December 31, 2016.

The following is information pertaining to impaired loans for June 30, 2017:

	Carrying Value		Unpaid Principal Balance		Required Reserve		Average Carrying Value for 3 Months Ending 6/30/17		Interest Income Recognized for 3 Months Ending 6/30/17		Average Carrying Value for 6 Months Ending 6/30/17		Interest Income Recognized for 6 Months Ending 6/30/17
	(in thousands)
With no required reserve recorded:
Construction and land development	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial and industrial		49		248		—		43		—		43		—
Municipal		—		—		—		—		—		—		—
Commercial real estate		—		—		—		294		—		421		—
Residential real estate		79		169		—		81		2		84		3
Consumer		—		—		—		—		—		—		—
Home equity		—		—		—		—		—		—		—
Total	$	128	$	417	$	—	$	418	$	2	$	548	$	3
With required reserve recorded:
Construction and land development	$	—	$	—	$	—	$	69	$	—	$	80	$	—
Commercial and industrial		316		331		11		326		4		332		8
Municipal		—		—		—		—		—		—		—
Commercial real estate		2,603		2,728		120		2,546		24		2,548		48
Residential real estate		4,264		4,265		69		1,145		24		701		25
Consumer		—		—		—		—		—		—		—
Home equity		—		—		—		—		—		—		—
Total	$	7,183	$	7,324	$	200	$	4,086	$	52	$	3,661	$	81
Total:
Construction and land development	$	—	$	—	$	—	$	69	$	—	$	80	$	—
Commercial and industrial		365		579		11		369		4		375		8
Municipal		—		—		—		—		—		—		—
Commercial real estate		2,603		2,728		120		2,840		24		2,969		48
Residential real estate		4,343		4,434		69		1,226		26		785		28
Consumer		—		—		—		—		—		—		—
Home equity		—		—		—		—		—		—		—
Total	$	7,311	$	7,741	$	200	$	4,504	$	54	$	4,209	$	84

The following is information pertaining to impaired loans for June 30, 2016:

	Carrying Value		Unpaid Principal Balance		Required Reserve		Average Carrying Value for 3 Months Ending 6/30/16		Interest Income Recognized for 3 Months Ending 6/30/16		Average Carrying Value for 6 Months Ending 6/30/16		Interest Income Recognized for 6 Months Ending 6/30/16
	(in thousands)
With no required reserve recorded:
Construction and land development	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial and industrial		52		239		—		54		—		56		—
Municipal		—		—		—		—		—		—		—
Commercial real estate		596		596		—		329		16		188		22
Residential real estate		103		190		—		106		2		108		4
Consumer		—		—		—		—		—		—		—
Home equity		—		—		—		—		—		—		—
Total	$	751	$	1,025	$	—	$	489	$	18	$	352	$	26
With required reserve recorded:
Construction and land development	$	96	$	108	$	6	$	97	$	—	$	97	$	—
Commercial and industrial		358		373		10		370		5		374		9
Municipal		—		—		—		—		—		—		—
Commercial real estate		3,140		3,239		151		2,030		20		1,878		33
Residential real estate		112		112		7		283		1		505		3
Consumer		—		—		—		—		—		—		—
Home equity		—		—		—		22		—		51		—
Total	$	3,706	$	3,832	$	174	$	2,802	$	26	$	2,905	$	45
Total:
Construction and land development	$	96	$	108	$	6	$	97	$	—	$	97	$	—
Commercial and industrial		410		612		10		424		5		430		9
Municipal		—		—		—		—		—		—		—
Commercial real estate		3,736		3,835		151		2,359		36		2,066		55
Residential real estate		215		302		7		389		3		613		7
Consumer		—		—		—		—		—		—		—
Home equity		—		—		—		22		—		51		—
Total	$	4,457	$	4,857	$	174	$	3,291	$	44	$	3,257	$	71

There were no troubled debt restructurings that occurred during the six-month period ended June 30, 2017.

There was one commercial real estate troubled debt restructuring during the six month period ending June 30, 2016. The pre-modification and post-modification outstanding recorded investment was $2,091,000. The loan was modified for 2016, by reducing the interest rate as well as extending the term on the loan. The financial impact for the modification was $3,000 reduction in principal payments and $1,000 reduction in interest payments.

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Reclassifications Out of Accumulated Other Comprehensive Income

6 Months Ended

Jun. 30, 2017

Text Block [Abstract]

Reclassifications Out of Accumulated Other Comprehensive Income

Note 5. Reclassifications Out of Accumulated Other Comprehensive Income (a)

Amount Reclassified from Accumulated Other Comprehensive Income

Details about Accumulated Other Comprehensive Income Components	Three Months Ended June 30, 2017			Three Months Ended June 30, 2016			Affected Line Item in the Statement where Net Income is Presented
(in thousands)
Unrealized gains and losses on available-for-sale securities	$	—		$	45		Net gains on sales of investments
		—			(18	)	Provision for income taxes
	$	—		$	27		Net income
Accretion of unrealized losses transferred	$	(662	)	$	(1,170	)	Interest on securities held-to-maturity
		402			408		Provision for income taxes
	$	(260	)	$	(762	)	Net income
Amortization of defined benefit pension items
Prior-service costs	$	(3	)(b)	$	(3	)(b)	Salaries and employee benefits
Actuarial gains (losses)		(385	)(b)		(401	)(b)	Salaries and employee benefits
Total before tax		(388	)		(404	)	Income before taxes
		155			161		Provision for income taxes
	$	(233	)	$	(243	)	Net income
Details about Accumulated Other Comprehensive Income Components	Six Months Ended June 30, 2017			Six Months Ended June 30, 2016			Affected Line Item in the Statement where Net Income is Presented
(in thousands)
Unrealized gains and losses on available-for-sale securities	$	—		$	45		Net gains on sales of investments
		—			(18	)	Provision for income taxes
	$	—		$	27		Net income
Accretion of unrealized losses transferred	$	(1,324	)	$	(2,682	)	Interest on securities held-to-maturity
		691			935		Provision for income taxes
	$	(633	)	$	(1,747	)	Net income
Amortization of defined benefit pension items
Prior-service costs	$	(6	)(b)	$	(5	)(b)	Salaries and employee benefits
Actuarial gains (losses)		(770	)(b)		(802	)(b)	Salaries and employee benefits
Total before tax		(776	)		(807	)	Income before taxes
		311			322		Provision for income taxes
	$	(465	)	$	(485	)	Net income

(a) Amount in parentheses indicates reductions to net income.

(b) These accumulated other comprehensive income components are included in the computation of net periodic pension cost (see Employee Benefits footnote (Note 7) for additional details).

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Earnings per Share ("EPS")

6 Months Ended

Jun. 30, 2017

Earnings Per Share [Abstract]

Earnings per Share ("EPS")

Note 6. Earnings per Share (“EPS”)

Class A and Class B shares participate equally in undistributed earnings. Under the Company’s Articles of Organization, the holders of Class A Common Stock are entitled to receive dividends per share equal to at least 200% of dividends paid, if any, from time to time, on each share of Class B Common Stock.

Diluted EPS includes the dilutive effect of common stock equivalents; basic EPS excludes all common stock equivalents. The Company had no common stock equivalents outstanding for the periods ended June 30, 2017 and 2016.

The following table is a reconciliation of basic EPS and diluted EPS.

	Three Months Ended June 30,				Six Months Ended June 30,
(in thousands except share and per share data)	2017		2016		2017		2016
Basic EPS Computation:
Numerator:
Net income, Class A	$	6,410	$	4,902	$	11,198	$	9,071
Net income, Class B		1,747		1,339		3,055		2,478
Denominator:
Weighted average shares outstanding, Class A		3,603,729		3,600,729		3,602,229		3,600,729
Weighted average shares outstanding, Class B		1,964,180		1,967,180		1,965,680		1,967,180
Basic EPS, Class A	$	1.78	$	1.36	$	3.11	$	2.52
Basic EPS, Class B		0.89		0.68		1.55		1.26
Diluted EPS Computation:
Numerator:
Net income, Class A	$	6,410	$	4,902	$	11,198	$	9,071
Net income, Class B		1,747		1,339		3,055		2,478
Total net income, for diluted EPS, Class A computation		8,157		6,241		14,253		11,549
Denominator:
Weighted average shares outstanding, basic, Class A		3,603,729		3,600,729		3,602,229		3,600,729
Weighted average shares outstanding, Class B		1,964,180		1,967,180		1,965,680		1,967,180
Weighted average shares outstanding diluted, Class A		5,567,909		5,567,909		5,567,909		5,567,909
Weighted average shares outstanding, Class B		1,964,180		1,967,180		1,965,680		1,967,180
Diluted EPS, Class A	$	1.47	$	1.12	$	2.56	$	2.07
Diluted EPS, Class B		0.89		0.68		1.55		1.26

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Employee Benefits

6 Months Ended

Jun. 30, 2017

Retirement Benefits [Abstract]

Employee Benefits

Note 7. Employee Benefits

The Company provides pension benefits to its employees under a noncontributory, defined benefit plan which is funded on a current basis in compliance with the requirements of the Employee Retirement Income Security Act of 1974 (“ERISA”) and recognizes costs over the estimated employee service period.

The Company also has a Supplemental Executive Insurance/Retirement Plan (the “Supplemental Plan”) which is limited to certain officers and employees of the Company. The Supplemental Plan is accrued on a current basis and recognizes costs over the estimated employee service period.

Executive officers of the Company and its subsidiaries who have at least one year of service may participate in the Supplemental Plan. The Supplemental Plan is voluntary and participants are required to contribute to its cost. Life insurance policies, which are owned by the Company, are purchased covering the lives of each participant.

Components of Net Periodic Benefit Cost for the Three Months Ended June 30,

	Pension Benefits						Supplemental Insurance/ Retirement Plan
	2017			2016			2017		2016
	(in thousands)
Service cost	$	310		$	318		$	395	$	455
Interest		362			340			345		334
Expected return on plan assets		(746	)		(694	)		—		—
Recognized prior service cost (benefit)		(26	)		(26	)		29		29
Recognized net actuarial losses		226			200			159		200
Net periodic benefit cost	$	126		$	138		$	928	$	1,018

Components of Net Periodic Benefit Cost for the Six Months Ended June 30,

	Pension Benefits						Supplemental Insurance/ Retirement Plan
	2017			2016			2017		2016
	(in thousands)
Service cost	$	620		$	636		$	790	$	910
Interest		724			680			690		668
Expected return on plan assets		(1,492	)		(1,388	)		—		—
Recognized prior service cost (benefit)		(52	)		(52	)		58		58
Recognized net actuarial losses		452			400			318		400
Net periodic benefit cost	$	252		$	276		$	1,856	$	2,036

Contributions

The Company intends to contribute $1,000,000 to the Pension Plan in 2017. As of June 30, 2017, $500,000 has been contributed.

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Fair Value Measurements

6 Months Ended

Jun. 30, 2017

Fair Value Disclosures [Abstract]

Fair Value Measurements

Note 8. Fair Value Measurements

The Company follows FASB ASC 820-10, Fair Value Measurements and Disclosures, which among other things, requires enhanced disclosures about assets and liabilities carried at fair value. ASC 820-10 establishes a hierarchal disclosure framework associated with the level of pricing observability utilized in measuring financial instruments at fair value. The three broad levels of the hierarchy are as follows:

Level I – Quoted prices are available in active markets for identical assets or liabilities as of the reported date. The type of financial instruments included in Level I are highly liquid cash instruments with quoted prices such as G-7 government, agency securities, listed equities and money market securities, as well as listed derivative instruments.

Level II – Pricing inputs are other than quoted prices in active markets, which are either directly or indirectly observable as of the reported date. The nature of these financial instruments include cash instruments for which quoted prices are available but traded less frequently, derivative instruments whose fair value have been derived using a model where inputs to the model are directly observable in the market, or can be derived principally from or corroborated by observable market data, and instruments that are fair valued using other financial instruments, the parameters of which can be directly observed. Instruments which are generally included in this category are corporate bonds and loans, mortgage whole loans and municipal bonds.

Level III – Instruments that have little to no pricing observability as of the reported date. These financial instruments do not have two-way markets and are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment or estimation. Instruments that are included in this category generally include certain commercial mortgage loans, certain private equity investments, and distressed debt and non-investment grade residual interests in securitizations.

The results of the fair value hierarchy as of June 30, 2017, are as follows:

Financial Instruments Measured at Fair Value on a Recurring Basis:

	Securities AFS Fair Value Measurements Using
	Carrying Value		Quoted Prices In Active Markets for Identitcal Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)
	(in thousands)
U.S . Treasury	$	1,995	$	—	$	1,995	$	—
U.S . Government Sponsored Enterprises		10,000		—		10,000		—
SBA Backed Securities		71,189		—		71,189		—
U.S . Government Agency and Sponsored Mortgage-Backed Securities		223,782		—		223,782		—
Privately Issued Residential Mortgage-Backed Securities		1,015		—		1,015		—
Obligations Issued by States and Political Subdivisions		98,049		—		—		98,049
Other Debt Securities		4,992		—		4,992		—
Equity Securities		318		318		—		—
Total	$	411,340	$	318	$	312,973	$	98,049
Financial Instruments Measured at Fair Value on a Non-recurring Basis:
Impaired Loans	$	230	$	—	$	—	$	230

Impaired loan balances represent those collateral dependent loans where management has estimated the credit loss by comparing the loan’s carrying value against the expected realizable fair value of the collateral. Fair value is generally determined through a review process that includes independent appraisals, discounted cash flows, or other external assessments of the underlying collateral, which generally include various Level 3 inputs which are not observable. The Company discounts the fair values, as appropriate, based on management’s observations of the local real estate market for loans in this category.

Appraisals, discounted cash flows and real estate tax assessments are reviewed quarterly. There is no specific policy regarding how frequently appraisals will be updated. Adjustments are made to appraisals and real estate tax assessments based on management’s estimate of changes in real estate values. Within the past twelve months there have been no updated appraisals, however, all impaired loans have been reviewed during the past quarter using either a discounted cash flow analysis, appraisal of collateral or other type of real estate tax assessment. The types of adjustments that are made to specific provisions (credits) relate to impaired loans recognized for the three and six month periods ended June 30, 2017 amounted to $4,000 and ($5,000), respectively.

There were no transfers between level 1, 2 and 3 for the six months ended June 30, 2017. There were no liabilities measured at fair value on a recurring or nonrecurring basis during the six month period ended June 30, 2017.

The following table presents additional information about assets measured at fair value on a recurring and nonrecurring basis for which the Company has utilized Level 3 inputs to determine fair value (dollars in thousands). Management continues to monitor the assumptions used to value the assets listed below.

Asset	Fair Value		Valuation Technique	Unobservable Input	Unobservable Input Value or Range
Securities AFS (4)	$	98,049	Discounted cash flow	Discount rate	0% -1% (3)
Impaired Loans	$	230	Appraisal of collateral (1)	Appraisal adjustments (2)	0%-30% discount

(1) Fair value is generally determined through independent appraisals of the underlying collateral, which generally include various Level 3 inputs which are not identifiable.

(2) Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated expenses.

(3) Weighted averages.

(4) Municipal securities generally have maturities of one year or less and, therefore, the amortized cost equates to the fair value. There was one auction rate security whose fair value is based on the evaluation of the underlying issuer, prevailing interest rates and market liquidity.

The changes in Level 3 securities for the three month period ended June 30, 2017 are shown in the table below:

	Auction Rate Securities		Obligations Issued by States & Political Subdivisions			Equity Securities		Total
	(in thousands)
Balance at December 31, 2016	$	4,298	$	160,578		$	—	$	164,876
Purchases		—		47,430			—		47,430
Maturities and calls		—		(114,144	)		—		(114,144	)
Amortization		—		(113	)		—		(113	)
Balance at June 30, 2017	$	4,298	$	93,751		$	—	$	98,049

The amortized cost of Level 3 securities was $98,457,000 at June 30, 2017 with an unrealized loss of $408,000. The securities in this category are generally municipal securities with no readily determinable fair value or failed auction rate securities. Management evaluated the fair value of these securities based on an evaluation of the underlying issuer, prevailing rates and market liquidity.

The changes in Level 3 securities for the six month period ended June 30, 2016, are shown in the table below:

	Auction Rate Securities		Obligations Issued by States & Political Subdivisions			Equity Securities			Total
	(in thousands)
Balance at December 31, 2015	$	3,820	$	153,140		$	37		$	156,997
Purchases		—		155,742			—			155,742
Maturities and calls		—		(100,245	)		(37	)		(100,282	)
Amortization		—		(97	)		—			(97	)
Changes in fair value		478		—			—			478
Balance at June 30, 2016	$	4,298	$	208,540		$	—		$	212,838

The amortized cost of Level 3 securities was $213,241,000 at June 30, 2016 with an unrealized loss of $403,000. The securities in this category are generally equity investments, municipal securities with no readily determinable fair value or failed auction rate securities. Management evaluated the fair value of these securities based on an evaluation of the underlying issuer, prevailing rates and market liquidity.

The results of the fair value hierarchy as of December 31, 2016, are as follows:

Financial Instruments Measured at Fair Value on a Recurring Basis:

	Securities AFS Fair Value Measurements Using
	Carrying Value		Quoted Prices In Active Markets for Identitcal Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)
	(in thousands)
U.S. Treasury	$	2,000	$	—	$	2,000	$	—
U.S. Government Sponsored Enterprises		24,952		—		24,952		—
SBA Backed Securities		57,767		—		57,767		—
U.S. Government Agency and Sponsored Mortgage-Backed Securities		243,325		—		243,325		—
Privately Issued Residential Mortgage-Backed Securities		1,109		—		1,109		—
Obligations Issued by States and Political Subdivisions		164,876		—		—		164,876
Other Debt Securities		4,924		—		4,924		—
Equity Securities		344		344		—		—
Total	$	499,297	$	344	$	334,077	$	164,876
Financial Instruments Measured at Fair Value on a Non-recurring Basis:
Impaired Loans	$	260	$	—	$	—	$	260

Impaired loan balances represent those collateral dependent loans where management has estimated the credit loss by comparing the loan’s carrying value against the expected realizable fair value of the collateral. Fair value is generally determined through a review process that includes independent appraisals, discounted cash flows, or other external assessments of the underlying collateral, which generally include various Level 3 inputs which are not identifiable. The Company discounts the fair values, as appropriate, based on management’s observations of the local real estate market for loans in this category.

Appraisals, discounted cash flows and real estate tax assessments are reviewed quarterly. There is no specific policy regarding how frequently appraisals will be updated. Adjustments are made to appraisals and real estate tax assessments based on management’s estimate of changes in real estate values. Within the past twelve months there have been no updated appraisals, however, all impaired loans have been reviewed during the past quarter using either a discounted cash flow analysis, appraisal of collateral or other type of real estate tax assessment. The types of adjustments that are made to specific provisions (credits) relate to impaired loans recognized for 2016 for the estimated credit loss amounted to ($135,000).

There were no transfers between level 1, 2 and 3 for the year ended December 31, 2016. There were no liabilities measured at fair value on a recurring or nonrecurring basis during the year ended December 31, 2016.

The following table presents additional information about assets measured at fair value on a recurring and nonrecurring basis for which the Company has utilized Level 3 inputs to determine fair value (dollars in thousands). Management continues to monitor the assumptions used to value the assets listed below.

Asset	Fair Value		Valuation Technique	Unobservable Input	Unobservable Input Value or Range
Securities AFS (4)	$	164,876	Discounted cash flow	Discount rate	0%-1% (3)
Impaired Loans	$	260	Appraisal of collateral (1)	Appraisal adjustments (2)	0%-30% discount

(1) Fair value is generally determined through independent appraisals of the underlying collateral, which generally include various Level 3 inputs which are not identifiable.

(2) Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated expenses.

(3) Weighted averages

(4) Municipal securities generally have maturities of one year or less and, therefore, the amortized cost equates to the fair value. There was one auction rate security whose fair value is based on the evaluation of the underlying issuer, prevailing interest rates and market liquidity.

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Fair Values of Financial Instruments

6 Months Ended

Jun. 30, 2017

Investments, All Other Investments [Abstract]

Fair Values of Financial Instruments

Note 9. Fair Values of Financial Instruments

The following methods and assumptions were used by the Company in estimating fair values of its financial instruments. Excluded from this disclosure are all nonfinancial instruments. Accordingly, the aggregate fair value amounts presented do not represent the underlying value of the Company.

The assumptions used below are expected to approximate those that market participants would use in valuing these financial instruments.

Fair value estimates are made at a specific point in time, based on available market information and judgments about the financial instrument, including estimates of timing, amount of expected future cash flows and the credit standing of the issuer. Such estimates do not consider the tax impact of the realization of unrealized gains or losses. In some cases, the fair value estimates cannot be substantiated by comparison to independent markets. In addition, the disclosed fair value may not be realized in the immediate settlement of the financial instrument. Care should be exercised in deriving conclusions about our business, its value or financial position based on the fair value information of financial instruments presented below.

Securities held-to-maturity: The fair values of these securities were based on quoted market prices, where available, as provided by third-party investment portfolio pricing vendors. If quoted market prices were not available, fair values provided by the vendors were based on quoted market prices of comparable instruments in active markets and/or based on a matrix pricing methodology which employs The Bond Market Association’s standard calculations for cash flow and price/yield analysis, live benchmark bond pricing and terms/condition data available from major pricing sources. Management regards the inputs and methods used by third party pricing vendors to be “Level 2 inputs and methods” as defined in the “fair value hierarchy” provided by FASB.

Loans Held-for-Sale: Fair value is measured using quoted market prices when available. These assets are typically categorized as Level 1. If quoted market prices are not available, comparable market values may be utilized. These assets are typically categorized as Level 2.

Loans: For variable-rate loans, that reprice frequently and with no significant change in credit risk, fair values are based on carrying amounts. The fair value of other loans is estimated using discounted cash flow analysis, based on interest rates currently being offered for loans with similar terms to borrowers of similar credit quality. Incremental credit risk for nonperforming loans has been considered.

Time deposits: The fair value of time deposits was estimated using a discounted cash flow approach that applies prevailing market interest rates for similar maturity instruments. The fair values of the Company’s time deposit liabilities do not take into consideration the value of the Company’s long-term relationships with depositors, which may have significant value.

Other borrowed funds: The fair value of other borrowed funds is based on the discounted value of contractual cash flows. The discount rate used is estimated based on the rates currently offered for other borrowed funds of similar remaining maturities.

Subordinated debentures: The fair value of subordinated debentures is based on the discounted value of contractual cash flows. The discount rate used is estimated based on the rates currently offered for other subordinated debentures of similar remaining maturities.

The following presents (in thousands) the carrying amount, estimated fair value, and placement in the fair value hierarchy of the Company’s financial instruments as of June 30, 2017 and December 31, 2016. This table excludes financial instruments for which the carrying amount approximates fair value. Financial assets for which the fair value approximates carrying value include cash and cash equivalents, short-term investments, FHLBB stock and accrued interest receivable. Financial liabilities for which the fair value approximates carrying value include non-maturity deposits, short-term borrowings and accrued interest payable.

June 30, 2017	Carrying Amount		Estimated Fair Value		Fair Value Measurements Level 1 Inputs		Fair Value Level 2 Inputs		Fair Value Level 3 Inputs
	(in thousands)
Financial assets:
Securities held-to-maturity	$	1,722,875	$	1,706,840	$	—	$	1,706,840	$	—
Loans (1)		2,008,510		1,987,896		—		—		1,987,896
Financial liabilities:
Time deposits		575,410		577,804		—		577,804		—
Other borrowed funds		455,500		457,252		—		457,252		—
Subordinated debentures		36,083		36,083		—		—		36,083
December 31, 2016
Financial assets:
Securities held-to-maturity	$	1,653,986	$	1,635,808	$	—	$	1,635,808	$	—
Loans (1)		1,899,527		1,873,703		—		—		1,873,703
Financial liabilities:
Time deposits		478,359		480,133		—		480,133		—
Other borrowed funds		293,000		294,940		—		294,940		—
Subordinated debentures		36,083		36,083		—		—		36,083

(1) Comprised of loans (including collateral dependent impaired loans), net of deferred loan costs and the allowance for loan losses.

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Recent Accounting Developments

6 Months Ended

Jun. 30, 2017

Accounting Changes and Error Corrections [Abstract]

Recent Accounting Developments

Note 10. Recent Accounting Developments

In March 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) ASU 2017-08, Receivables—Nonrefundable Fees and Other Costs (Subtopic 310-20) Premium Amortization on Purchased Callable Debt. The FASB is issuing this ASU to amend the amortization period for certain purchased callable debt securities held at a premium. The FASB is shortening the amortization period for the premium to the earliest call date. Under current generally accepted accounting principles (GAAP), entities generally amortize the premium as an adjustment of yield over the contractual life of the instrument. For public business entities, the amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Management is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2017.

In March 2017, the FASB issued ASU 2017-07, Compensation-Retirement benefits (Topic 715) Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The amendments in this ASU require that an employer disaggregate the service cost component from the other components of net benefit cost. The amendments also provide explicit guidance on how to present the service cost component and the other components of net benefit cost in the income statement and allow only the service cost component of net benefit cost to be eligible for capitalization. The amendments in this ASU are effective for fiscal years beginning after December 15, 2017. Early adoption is permitted. Management is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2017.

In February 2017, the FASB issued ASU 2017-06, Plan Accounting: Defined Benefit Pension Plans (Topic 960) Defined Contribution Pension Plans (Topic 962) Health and Welfare Benefit Plans (Topic 965), Employee Benefit Plan Master Trust Reporting. The FASB has issued this ASU to improve the usefulness of the information reported to users of employee benefit plan financial statements and to provide clarity to preparers and auditors. This ASU relates primarily to the reporting by an employee benefit plan for its interest in a master trust. The amendments in this ASU clarify presentation requirements for a plan’s interest in a master trust and require more detailed disclosures of the plan’s interest in the master trust. The amendments in this ASU are effective for fiscal years beginning after December 15, 2018. Early adoption is permitted. Management is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2017.

In February 2017, the FASB issued ASU 2017-05, Other Income Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20). This ASU was issued to clarify the scope of Subtopic 610-20, and to add guidance for partial sales of nonfinancial assets. For public entities, this ASU is effective for annual reporting periods beginning after December 15, 2017. Management believes that this ASU applies and is assessing the impact, if any, as of June 30, 2017.

In January 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2017-04, Intangibles – Goodwill and Other (Topic 350). This ASU was issued to simplify the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. For public entities, this ASU is effective for the fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted and application should be on a prospective basis. Management is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2017.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This ASU was issued to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. To achieve this objective, the amendments in this ASU replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The amendments in this ASU are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The Company is currently assessing this ASU and has not determined the impact, if any, as of June 30, 2017.

In May 2016, the FASB issued ASU 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients. The intention of this ASU is to provide additional clarification on specific issues brought forth by the FASB and the International Accounting Standards Board Joint Transition Resource Group for Revenue Recognition in relation to Topic 606 and revenue recognition. This ASU is to have the same effective date as ASU 2015-14 which deferred the effective date of ASU 2014-09 to December 15, 2017. Management has determined that ASU 2016-12 does apply, but has not determined the impact, if any, as of June 30, 2017. Management assembled a project team to address the changes pursuant to Topic 606. The project team has made an initial scope assessment and additional progress over the topic is expected to be made in the third quarter of 2017.

In February 2016, the FASB issued ASU 2016-02, Leases. This ASU requires lessees to put most leases on their balance sheet but recognize expenses on their income statements in a manner similar to today’s accounting. This ASU also eliminates today’s real estate-specific provisions for all companies. For lessors, this ASU modifies the classification criteria and the accounting for sales-type and direct financing leases. This ASU is effective for fiscal years beginning after December 15, 2018, including interim periods therein. Early adoption is permitted. The Company is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2017.

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Recent Accounting Developments (Policies)

6 Months Ended

Jun. 30, 2017

Accounting Changes and Error Corrections [Abstract]

Recent Accounting Developments

Recent Accounting Developments

In March 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) ASU 2017-08, Receivables—Nonrefundable Fees and Other Costs (Subtopic 310-20) Premium Amortization on Purchased Callable Debt. The FASB is issuing this ASU to amend the amortization period for certain purchased callable debt securities held at a premium. The FASB is shortening the amortization period for the premium to the earliest call date. Under current generally accepted accounting principles (GAAP), entities generally amortize the premium as an adjustment of yield over the contractual life of the instrument. For public business entities, the amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Management is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2017.

In March 2017, the FASB issued ASU 2017-07, Compensation-Retirement benefits (Topic 715) Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The amendments in this ASU require that an employer disaggregate the service cost component from the other components of net benefit cost. The amendments also provide explicit guidance on how to present the service cost component and the other components of net benefit cost in the income statement and allow only the service cost component of net benefit cost to be eligible for capitalization. The amendments in this ASU are effective for fiscal years beginning after December 15, 2017. Early adoption is permitted. Management is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2017.

In February 2017, the FASB issued ASU 2017-06, Plan Accounting: Defined Benefit Pension Plans (Topic 960) Defined Contribution Pension Plans (Topic 962) Health and Welfare Benefit Plans (Topic 965), Employee Benefit Plan Master Trust Reporting. The FASB has issued this ASU to improve the usefulness of the information reported to users of employee benefit plan financial statements and to provide clarity to preparers and auditors. This ASU relates primarily to the reporting by an employee benefit plan for its interest in a master trust. The amendments in this ASU clarify presentation requirements for a plan’s interest in a master trust and require more detailed disclosures of the plan’s interest in the master trust. The amendments in this ASU are effective for fiscal years beginning after December 15, 2018. Early adoption is permitted. Management is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2017.

In February 2017, the FASB issued ASU 2017-05, Other Income Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20). This ASU was issued to clarify the scope of Subtopic 610-20, and to add guidance for partial sales of nonfinancial assets. For public entities, this ASU is effective for annual reporting periods beginning after December 15, 2017. Management believes that this ASU applies and is assessing the impact, if any, as of June 30, 2017.

In January 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2017-04, Intangibles – Goodwill and Other (Topic 350). This ASU was issued to simplify the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. For public entities, this ASU is effective for the fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted and application should be on a prospective basis. Management is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2017.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This ASU was issued to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. To achieve this objective, the amendments in this ASU replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The amendments in this ASU are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The Company is currently assessing this ASU and has not determined the impact, if any, as of June 30, 2017.

In May 2016, the FASB issued ASU 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients. The intention of this ASU is to provide additional clarification on specific issues brought forth by the FASB and the International Accounting Standards Board Joint Transition Resource Group for Revenue Recognition in relation to Topic 606 and revenue recognition. This ASU is to have the same effective date as ASU 2015-14 which deferred the effective date of ASU 2014-09 to December 15, 2017. Management has determined that ASU 2016-12 does apply, but has not determined the impact, if any, as of June 30, 2017. Management assembled a project team to address the changes pursuant to Topic 606. The project team has made an initial scope assessment and additional progress over the topic is expected to be made in the third quarter of 2017.

In February 2016, the FASB issued ASU 2016-02, Leases. This ASU requires lessees to put most leases on their balance sheet but recognize expenses on their income statements in a manner similar to today’s accounting. This ASU also eliminates today’s real estate-specific provisions for all companies. For lessors, this ASU modifies the classification criteria and the accounting for sales-type and direct financing leases. This ASU is effective for fiscal years beginning after December 15, 2018, including interim periods therein. Early adoption is permitted. The Company is currently assessing the applicability of this ASU and has not determined the impact, if any, as of June 30, 2017.

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Securities Available-for-Sale (Tables)

6 Months Ended

Jun. 30, 2017

Text Block [Abstract]

Summary of Securities Available-for-Sale

	June 30, 2017								December 31, 2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(in thousands)
U.S. Treasury	$	1,999	$	—	$	4	$	1,995	$	2,000	$	—	$	—	$	2,000
U.S. Government Sponsored Enterprises		10,000		—		—		10,000		25,000		—		48		24,952
SBA Backed Securities		71,357		27		195		71,189		57,899		14		146		57,767
U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities		223,655		463		336		223,782		243,703		293		671		243,325
Privately Issued Residential Mortgage-Backed Securities		1,025		3		13		1,015		1,121		2		14		1,109
Obligations Issued by States and Political Subdivisions		98,457		—		408		98,049		165,281		—		405		164,876
Other Debt Securities		5,100		85		193		4,992		5,100		18		194		4,924
Equity Securities		116		202		—		318		116		228		—		344
Total	$	411,709	$	780	$	1,149	$	411,340	$	500,220	$	555	$	1,478	$	499,297

Maturity Distribution of Securities Available-for-Sale

The following table shows the maturity distribution of the Company’s securities available-for-sale at June 30, 2017.

	Amortized Cost		Fair Value
	(in thousands)
Within one year	$	90,264	$	90,255
After one but within five years		132,716		132,786
After five but within ten years		105,344		105,360
More than 10 years		81,769		81,270
Non-maturing		1,616		1,669
Total	$	411,709	$	411,340

Continuous Unrealized Loss Position for Less than 12 Months and 12 Months or Longer

The following table shows the temporarily impaired securities of the Company’s available-for-sale portfolio at June 30, 2017. This table shows the unrealized market loss of securities that have been in a continuous unrealized loss position for less than 12 months and a continuous loss position for 12 months or longer. There are 13 and 27 securities that are temporarily impaired for less than 12 months and for 12 months or longer, respectively, out of a total of 269 holdings at June 30, 2017.

	June 30, 2017
	Less than 12 months				12 months or longer				Total
Temporarily Impaired Investments	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(in thousands)
U.S. Treasury	$	1,995	$	4	$	—	$	—	$	1,995	$	4
U.S. Government Sponsored Enterprises		—		—		—		—		—		—
SBA Backed Securities		27,850		116		17,775		79		45,625		195
U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities		36,251		83		66,121		253		102,372		336
Privately Issued Residential Mortgage-Backed Securities		—		—		707		13		707		13
Obligations Issued by States and Political Subdivisions		—		—		4,297		408		4,297		408
Other Debt Securities		—		—		1,907		193		1,907		193
Total temporarily impaired securities	$	66,096	$	203	$	90,807	$	946	$	156,903	$	1,149

The following table shows the temporarily impaired securities of the Company’s available-for-sale portfolio at December 31, 2016. This table shows the unrealized market loss of securities that have been in a continuous unrealized loss position for less than 12 months and a continuous loss position for 12 months or longer. There are 49 and 15 securities that are temporarily impaired for less than 12 months and for 12 months or longer, respectively, out of a total of 270 holdings at December 31, 2016.

Temporarily Impaired Investments	December 31, 2016
	Less than 12 months				12 months or longer				Total
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(in thousands)
U.S. Government Sponsored Enterprises	$	24,952	$	48	$	—	$	—	$	24,952	$	48
SBA Backed Securities		52,346		145		951		1		53,297		146
U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities		135,612		485		31,504		186		167,116		671
Privately Issued Residential Mortgage-Backed Securities		—		—		757		14		757		14
Obligations Issued by States and Political Subdivisions		—		—		4,298		405		4,298		405
Other Debt Securities		453		47		1,553		147		2,006		194
Total temporarily impaired securities	$	213,363	$	725	$	39,063	$	753	$	252,426	$	1,478

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Investment Securities Held-to-Maturity (Tables)

6 Months Ended

Jun. 30, 2017

Text Block [Abstract]

Summary of Held-to-Maturity Securities

	June 30, 2017								December 31, 2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
	(in thousands)
U.S. Government Sponsored Enterprises	$	134,378	$	931	$	287	$	135,022	$	148,326	$	1,066	$	527	$	148,865
SBA Backed Securities		54,427		3		779		53,651		46,140		—		1,088		45,052
U.S. Government Agency and Sponsored Enterprises Mortgage-Backed Securities		1,534,070		5,419		21,322		1,518,167		1,459,520		4,948		22,577		1,441,891
Total	$	1,722,875	$	6,353	$	22,388	$	1,706,840	$	1,653,986	$	6,014	$	24,192	$	1,635,808

Company's Securities Held-to-Maturity

The following table shows the maturity distribution of the Company’s securities held-to-maturity at June 30, 2017.

	Amortized Cost		Fair Value
	(in thousands)
Within one year	$	45,780	$	45,827
After one but within five years		1,224,104		1,213,863
After five but within ten years		449,698		444,027
More than ten years		3,293		3,123
Total	$	1,722,875	$	1,706,840

Unrealized Market Loss of Securities

The following table shows the temporarily impaired securities of the Company’s held-to-maturity portfolio at June 30, 2017. This table shows the unrealized market loss of securities that have been in a continuous unrealized loss position for 12 months or less and a continuous loss position for 12 months or longer. There are 190 and 22 securities that are temporarily impaired for less than 12 months and for 12 months or longer, respectively, out of a total of 393 holdings at June 30, 2017.

	June 30, 2017
	Less Than 12 Months				12 Months or Longer				Total
Temporarily Impaired Investments	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(in thousands)
U.S. Government Sponsored Enterprises	$	45,209	$	287	$	—	$	—	$	45,209	$	287
SBA Backed Securities		50,633		779		—		—		50,633		779
U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities		1,015,890		18,964		76,584		2,358		1,092,474		21,322
Total temporarily impaired securities	$	1,111,732	$	20,030	$	76,584	$	2,358	$	1,188,316	$	22,388

The following table shows the temporarily impaired securities of the Company’s held-to-maturity portfolio at December 31, 2016. This table shows the unrealized market loss of securities that have been in a continuous unrealized loss position for less than 12 months and a continuous loss position for 12 months or longer. There are 194 and 16 securities that are temporarily impaired for less than 12 months and for 12 months or longer, respectively, out of a total of 375 holdings at December 31, 2016.

	December 31, 2016
	Less Than 12 Months				12 Months or Longer				Total
Temporarily Impaired Investments	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(in thousands)
U.S. Government Sponsored Enterprises	$	59,219	$	527	$	—	$	—	$	59,219	$	527
SBA Backed Securities		45,052		1,088		—		—		45,052		1,088
U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities		1,008,960		20,725		58,535		1,852		1,067,495		22,577
Total temporarily impaired securities	$	1,113,231	$	22,340	$	58,535	$	1,852	$	1,171,766	$	24,192

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Allowance for Loan Losses (Tables)

6 Months Ended

Jun. 30, 2017

Receivables [Abstract]

Summary of Changes in Allowance for Loan Losses

The following table summarizes the changes in the Company’s allowance for loan losses for the periods indicated.

	Three months ended June 30,						Six months ended June 30,
	2017			2016			2017			2016
	(in thousands)
Allowance for loan losses, beginning of period	$	24,827		$	23,544		$	24,406		$	23,075
Adjustment		—			(84	)		—			(84	)
Loans charged off		(100	)		(111	)		(197	)		(180	)
Recoveries on loans previously charged-off		72			164			190			252
Net (charge-offs) / recoveries		(28	)		53			(7	)		72
Provision charged to expense		490			350			890			800
Allowance for loan losses, end of period	$	25,289		$	23,863		$	25,289		$	23,863

Summary of Allowance for Loan Losses

Further information pertaining to the allowance for loan losses for the three months ending June 30, 2017 follows:

	Construction and Land Development		Commercial and Industrial			Municipal			Commercial Real Estate			Residential Real Estate		Consumer			Home Equity		Unallocated			Total
	(in thousands)
Allowance for loan losses:
Balance at March 31, 2017	$	873	$	7,369		$	1,899		$	11,216		$	1,671	$	452		$	1,050	$	297		$	24,827
Charge-offs		—		(29	)		—			—			—		(71	)		—		—			(100	)
Recoveries		—		34			—			—			—		38			—		—			72
Provision		264		189			(40	)		(188	)		447		(224	)		96		(54	)		490
Ending balance at June 30, 2017	$	1,137	$	7,563		$	1,859		$	11,028		$	2,118	$	195		$	1,146	$	243		$	25,289
Amount of allowance for loan losses for loans deemed to be impaired	$	—	$	11		$	—		$	120		$	69	$	—		$	—	$	—		$	200
Amount of allowance for loan losses for loans not deemed to be impaired	$	1,137	$	7,552		$	1,859		$	10,908		$	2,049	$	195		$	1,146	$	243		$	25,089
Loans:
Ending balance	$	14,159	$	650,542		$	127,259		$	736,603		$	264,744	$	11,218		$	229,274	$	—		$	2,033,799
Loans deemed to be impaired	$	—	$	365		$	—		$	2,603		$	4,343	$	—		$	—	$	—		$	7,311
Loans not deemed to be impaired	$	14,159	$	650,177		$	127,259		$	734,000		$	260,401	$	11,218		$	229,274	$	—		$	2,026,488

Further information pertaining to the allowance for loan losses for the six months ending June 30, 2017 follows:

	Construction and Land Development		Commercial and Industrial			Municipal		Commercial Real Estate			Residential Real Estate		Consumer			Home Equity		Unallocated			Total
	(in thousands)
Allowance for loan losses:
Balance at December 31, 2016	$	1,012	$	6,972		$	1,612	$	11,135		$	1,698	$	582		$	1,102	$	293		$	24,406
Charge-offs		—		(29	)		—		—			—		(168	)		—		—			(197	)
Recoveries		—		54			—		—			2		134			—		—			190
Provision		125		566			247		(107	)		418		(353	)		44		(50	)		890
Ending balance at June 30, 2017	$	1,137	$	7,563		$	1,859	$	11,028		$	2,118	$	195		$	1,146	$	243		$	25,289
Amount of allowance for loan losses for loans deemed to be impaired	$	—	$	11		$	—	$	120		$	69	$	—		$	—	$	—		$	200
Amount of allowance for loan losses for loans not deemed to be impaired	$	1,137	$	7,552		$	1,859	$	10,908		$	2,049	$	195		$	1,146	$	243		$	25,089
Loans:
Ending balance	$	14,159	$	650,542		$	127,259	$	736,603		$	264,744	$	11,218		$	229,274	$	—		$	2,033,799
Loans deemed to be impaired	$	—	$	365		$	—	$	2,603		$	4,343	$	—		$	—	$	—		$	7,311
Loans not deemed to be impaired	$	14,159	$	650,177		$	127,259	$	734,000		$	260,401	$	11,218		$	229,274	$	—		$	2,026,488

Further information pertaining to the allowance for loan losses for the three months ending June 30, 2016 follows:

	Construction and Land Development			Commercial and Industrial			Municipal		Commercial Real Estate			Residential Real Estate			Consumer			Home Equity			Unallocated		Total
	(in thousands)
Allowance for loan losses:
Balance at March 31, 2016	$	1,973		$	6,693		$	990	$	10,533		$	1,249		$	693		$	1,185		$	228	$	23,544
Charge-offs		—			—			—		—			—			(111	)		—			—		(111	)
Recoveries		—			56			—		—			2			106			—			—		164
Provision		264			(878	)		811		128			53			(77	)		9			40		350
Reclassification to other liabilities		(3	)		(29	)		—		(11	)		(2	)		(3	)		(36	)		—		(84	)
Ending balance at June 30, 2016	$	2,234		$	5,842		$	1,801	$	10,650		$	1,302		$	608		$	1,158		$	268	$	23,863
Amount of allowance for loan losses for loans deemed to be impaired	$	6		$	10		$	—	$	151		$	7		$	—		$	—		$	—	$	174
Amount of allowance for loan losses for loans not deemed to be impaired	$	2,228		$	5,832		$	1,801	$	10,499		$	1,295		$	608		$	1,158		$	268	$	23,689
Loans:
Ending balance	$	31,178		$	493,033		$	134,386	$	728,658		$	219,494		$	11,339		$	183,816		$	—	$	1,801,904
Loans deemed to be impaired	$	96		$	410		$	—	$	3,736		$	215		$	—		$	—		$	—	$	4,457
Loans not deemed to be impaired	$	31,082		$	492,623		$	134,386	$	724,922		$	219,279		$	11,339		$	183,816		$	—	$	1,797,447

Further information pertaining to the allowance for loan losses for the six months ending June 30, 2016 follows:

	Construction and Land Development			Commercial and Industrial			Municipal		Commercial Real Estate			Residential Real Estate			Consumer			Home Equity			Unallocated			Total
	(in thousands)
Allowance for loan losses:
Balance at December 31, 2015	$	2,041		$	5,899		$	994	$	10,589		$	1,320		$	644		$	1,077		$	511		$	23,075
Charge-offs		—			—			—		—			—			(180	)		—			—			(180	)
Recoveries		—			91			—		—			3			158			—			—			252
Provision		196			(119	)		807		72			(19	)		(11	)		117			(243	)		800
Reclassification to other liabilities		(3	)		(29	)		—		(11	)		(2	)		(3	)		(36	)		—			(84	)
Ending balance at June 30, 2016	$	2,234		$	5,842		$	1,801	$	10,650		$	1,302		$	608		$	1,158		$	268		$	23,863
Amount of allowance for loan losses for loans deemed to be impaired	$	6		$	10		$	—	$	151		$	7		$	—		$	—		$	—		$	174
Amount of allowance for loan losses for loans not deemed to be impaired	$	2,228		$	5,832		$	1,801	$	10,499		$	1,295		$	608		$	1,158		$	268		$	23,689
Loans:
Ending balance	$	31,178		$	493,033		$	134,386	$	728,658		$	219,494		$	11,339		$	183,816		$	—		$	1,801,904
Loans deemed to be impaired	$	96		$	410		$	—	$	3,736		$	215		$	—		$	—		$	—		$	4,457
Loans not deemed to be impaired	$	31,082		$	492,623		$	134,386	$	724,922		$	219,279		$	11,339		$	183,816		$	—		$	1,797,447

Loans by Risk Rating

The following table presents the Company’s loans by risk rating at June 30, 2017.

	Construction and Land Development		Commercial and Industrial		Municipal		Commercial Real Estate
	(in thousands)
Grade:
1-3 (Pass)	$	14,159	$	650,177	$	127,259	$	704,531
4 (Monitor)		—		—		—		29,469
5 (Substandard)		—		—		—		—
6 (Doubtful)		—		—		—		—
Impaired		—		365		—		2,603
Total	$	14,159	$	650,542	$	127,259	$	736,603

The following table presents the Company’s loans by risk rating at December 31, 2016.

	Construction and Land Development		Commercial and Industrial		Municipal		Commercial Real Estate
	(in thousands)
Grade:
1-3 (Pass)	$	14,834	$	612,114	$	135,418	$	661,271
4 (Monitor)		—		—		—		31,753
5 (Substandard)		—		—		—		—
6 (Doubtful)		—		—		—		—
Impaired		94		389		—		3,149
Total	$	14,928	$	612,503	$	135,418	$	696,173

Loans by Credit Ratings Issued by National Organizations

Credit ratings issued by national organizations were utilized as credit quality indicators as presented in the following table at June 30, 2017 and are included within the total loan portfolio.

	Commercial and Industrial		Municipal		Commercial Real Estate		Total
	(in thousands)
Credit Rating:
Aaa – Aa3	$	341,777	$	66,484	$	45,615	$	453,876
A1 – A3		218,222		8,225		128,927		355,374
Baa1 – Baa3		—		46,970		125,775		172,745
Ba2		—		2,730		—		2,730
Total	$	559,999	$	124,409	$	300,317	$	984,725

Credit ratings issued by national organizations were utilized as credit quality indicators as presented in the following table at December 31, 2016.

	Commercial and Industrial		Municipal		Commercial Real Estate		Total
	(in thousands)
Credit Rating:
Aaa – Aa3	$	334,674	$	66,245	$	6,596	$	407,515
A1 – A3		188,777		33,365		129,423		351,565
Baa1 – Baa3		—		26,970		127,366		154,336
Ba2		—		3,610		—		3,610
Total	$	523,451	$	130,190	$	263,385	$	917,026

Aging of Past Due Loan Losses

Further information pertaining to the allowance for loan losses at June 30, 2017 follows:

	Accruing 30-89 Days Past Due		Non Accrual		Accruing Greater than 90 Days		Total Past Due		Current Loans		Total
	(in thousands)
Construction and land development	$	—	$	—	$	—	$	—	$	14,159	$	14,159
Commercial and industrial		404		49		—		453		650,089		650,542
Municipal		—		—		—		—		127,259		127,259
Commercial real estate		455		230		—		685		735,918		736,603
Residential real estate		984		735		—		1,719		263,025		264,744
Consumer and overdrafts		6		1		—		7		11,211		11,218
Home equity		1,357		107		—		1,464		227,810		229,274
Total	$	3,206	$	1,122	$	—	$	4,328	$	2,029,471	$	2,033,799

Further information pertaining to the allowance for loan losses at December 31, 2016 follows:

	Accruing 30-89 Days Past Due		Non Accrual		Accruing Greater than 90 Days		Total Past Due		Current Loans		Total
	(in thousands)
Construction and land development	$	—	$	94	$	—	$	94	$	14,834	$	14,928
Commercial and industrial		37		65		—		102		612,401		612,503
Municipal		—		—		—		—		135,418		135,418
Commercial real estate		597		150		—		747		695,426		696,173
Residential real estate		245		656		—		901		240,456		241,357
Consumer and overdrafts		—		11		—		11		11,686		11,697
Home equity		735		108		—		843		211,014		211,857
Total	$	1,614	$	1,084	$	—	$	2,698	$	1,921,235	$	1,923,933

Information Pertaining to Impaired Loans

The following is information pertaining to impaired loans for June 30, 2017:

	Carrying Value		Unpaid Principal Balance		Required Reserve		Average Carrying Value for 3 Months Ending 6/30/17		Interest Income Recognized for 3 Months Ending 6/30/17		Average Carrying Value for 6 Months Ending 6/30/17		Interest Income Recognized for 6 Months Ending 6/30/17
	(in thousands)
With no required reserve recorded:
Construction and land development	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial and industrial		49		248		—		43		—		43		—
Municipal		—		—		—		—		—		—		—
Commercial real estate		—		—		—		294		—		421		—
Residential real estate		79		169		—		81		2		84		3
Consumer		—		—		—		—		—		—		—
Home equity		—		—		—		—		—		—		—
Total	$	128	$	417	$	—	$	418	$	2	$	548	$	3
With required reserve recorded:
Construction and land development	$	—	$	—	$	—	$	69	$	—	$	80	$	—
Commercial and industrial		316		331		11		326		4		332		8
Municipal		—		—		—		—		—		—		—
Commercial real estate		2,603		2,728		120		2,546		24		2,548		48
Residential real estate		4,264		4,265		69		1,145		24		701		25
Consumer		—		—		—		—		—		—		—
Home equity		—		—		—		—		—		—		—
Total	$	7,183	$	7,324	$	200	$	4,086	$	52	$	3,661	$	81
Total:
Construction and land development	$	—	$	—	$	—	$	69	$	—	$	80	$	—
Commercial and industrial		365		579		11		369		4		375		8
Municipal		—		—		—		—		—		—		—
Commercial real estate		2,603		2,728		120		2,840		24		2,969		48
Residential real estate		4,343		4,434		69		1,226		26		785		28
Consumer		—		—		—		—		—		—		—
Home equity		—		—		—		—		—		—		—
Total	$	7,311	$	7,741	$	200	$	4,504	$	54	$	4,209	$	84

The following is information pertaining to impaired loans for June 30, 2016:

	Carrying Value		Unpaid Principal Balance		Required Reserve		Average Carrying Value for 3 Months Ending 6/30/16		Interest Income Recognized for 3 Months Ending 6/30/16		Average Carrying Value for 6 Months Ending 6/30/16		Interest Income Recognized for 6 Months Ending 6/30/16
	(in thousands)
With no required reserve recorded:
Construction and land development	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial and industrial		52		239		—		54		—		56		—
Municipal		—		—		—		—		—		—		—
Commercial real estate		596		596		—		329		16		188		22
Residential real estate		103		190		—		106		2		108		4
Consumer		—		—		—		—		—		—		—
Home equity		—		—		—		—		—		—		—
Total	$	751	$	1,025	$	—	$	489	$	18	$	352	$	26
With required reserve recorded:
Construction and land development	$	96	$	108	$	6	$	97	$	—	$	97	$	—
Commercial and industrial		358		373		10		370		5		374		9
Municipal		—		—		—		—		—		—		—
Commercial real estate		3,140		3,239		151		2,030		20		1,878		33
Residential real estate		112		112		7		283		1		505		3
Consumer		—		—		—		—		—		—		—
Home equity		—		—		—		22		—		51		—
Total	$	3,706	$	3,832	$	174	$	2,802	$	26	$	2,905	$	45
Total:
Construction and land development	$	96	$	108	$	6	$	97	$	—	$	97	$	—
Commercial and industrial		410		612		10		424		5		430		9
Municipal		—		—		—		—		—		—		—
Commercial real estate		3,736		3,835		151		2,359		36		2,066		55
Residential real estate		215		302		7		389		3		613		7
Consumer		—		—		—		—		—		—		—
Home equity		—		—		—		22		—		51		—
Total	$	4,457	$	4,857	$	174	$	3,291	$	44	$	3,257	$	71

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Reclassifications Out of Accumulated Other Comprehensive Income (Tables)

6 Months Ended

Jun. 30, 2017

Text Block [Abstract]

Reclassifications Out of Accumulated Other Comprehensive Income

Amount Reclassified from Accumulated Other Comprehensive Income

Details about Accumulated Other Comprehensive Income Components	Three Months Ended June 30, 2017			Three Months Ended June 30, 2016			Affected Line Item in the Statement where Net Income is Presented
(in thousands)
Unrealized gains and losses on available-for-sale securities	$	—		$	45		Net gains on sales of investments
		—			(18	)	Provision for income taxes
	$	—		$	27		Net income
Accretion of unrealized losses transferred	$	(662	)	$	(1,170	)	Interest on securities held-to-maturity
		402			408		Provision for income taxes
	$	(260	)	$	(762	)	Net income
Amortization of defined benefit pension items
Prior-service costs	$	(3	)(b)	$	(3	)(b)	Salaries and employee benefits
Actuarial gains (losses)		(385	)(b)		(401	)(b)	Salaries and employee benefits
Total before tax		(388	)		(404	)	Income before taxes
		155			161		Provision for income taxes
	$	(233	)	$	(243	)	Net income
Details about Accumulated Other Comprehensive Income Components	Six Months Ended June 30, 2017			Six Months Ended June 30, 2016			Affected Line Item in the Statement where Net Income is Presented
(in thousands)
Unrealized gains and losses on available-for-sale securities	$	—		$	45		Net gains on sales of investments
		—			(18	)	Provision for income taxes
	$	—		$	27		Net income
Accretion of unrealized losses transferred	$	(1,324	)	$	(2,682	)	Interest on securities held-to-maturity
		691			935		Provision for income taxes
	$	(633	)	$	(1,747	)	Net income
Amortization of defined benefit pension items
Prior-service costs	$	(6	)(b)	$	(5	)(b)	Salaries and employee benefits
Actuarial gains (losses)		(770	)(b)		(802	)(b)	Salaries and employee benefits
Total before tax		(776	)		(807	)	Income before taxes
		311			322		Provision for income taxes
	$	(465	)	$	(485	)	Net income

(a) Amount in parentheses indicates reductions to net income.

(b) These accumulated other comprehensive income components are included in the computation of net periodic pension cost (see Employee Benefits footnote (Note 7) for additional details).

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Earnings per Share ("EPS") (Tables)

6 Months Ended

Jun. 30, 2017

Earnings Per Share [Abstract]

Reconciliation of Basic EPS and Diluted EPS

The following table is a reconciliation of basic EPS and diluted EPS.

	Three Months Ended June 30,				Six Months Ended June 30,
(in thousands except share and per share data)	2017		2016		2017		2016
Basic EPS Computation:
Numerator:
Net income, Class A	$	6,410	$	4,902	$	11,198	$	9,071
Net income, Class B		1,747		1,339		3,055		2,478
Denominator:
Weighted average shares outstanding, Class A		3,603,729		3,600,729		3,602,229		3,600,729
Weighted average shares outstanding, Class B		1,964,180		1,967,180		1,965,680		1,967,180
Basic EPS, Class A	$	1.78	$	1.36	$	3.11	$	2.52
Basic EPS, Class B		0.89		0.68		1.55		1.26
Diluted EPS Computation:
Numerator:
Net income, Class A	$	6,410	$	4,902	$	11,198	$	9,071
Net income, Class B		1,747		1,339		3,055		2,478
Total net income, for diluted EPS, Class A computation		8,157		6,241		14,253		11,549
Denominator:
Weighted average shares outstanding, basic, Class A		3,603,729		3,600,729		3,602,229		3,600,729
Weighted average shares outstanding, Class B		1,964,180		1,967,180		1,965,680		1,967,180
Weighted average shares outstanding diluted, Class A		5,567,909		5,567,909		5,567,909		5,567,909
Weighted average shares outstanding, Class B		1,964,180		1,967,180		1,965,680		1,967,180
Diluted EPS, Class A	$	1.47	$	1.12	$	2.56	$	2.07
Diluted EPS, Class B		0.89		0.68		1.55		1.26

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Employee Benefits (Tables)

6 Months Ended

Jun. 30, 2017

Retirement Benefits [Abstract]

Components of Net Periodic Benefit Cost (Credit)

Components of Net Periodic Benefit Cost for the Three Months Ended June 30,

	Pension Benefits						Supplemental Insurance/ Retirement Plan
	2017			2016			2017		2016
	(in thousands)
Service cost	$	310		$	318		$	395	$	455
Interest		362			340			345		334
Expected return on plan assets		(746	)		(694	)		—		—
Recognized prior service cost (benefit)		(26	)		(26	)		29		29
Recognized net actuarial losses		226			200			159		200
Net periodic benefit cost	$	126		$	138		$	928	$	1,018

Components of Net Periodic Benefit Cost for the Six Months Ended June 30,

	Pension Benefits						Supplemental Insurance/ Retirement Plan
	2017			2016			2017		2016
	(in thousands)
Service cost	$	620		$	636		$	790	$	910
Interest		724			680			690		668
Expected return on plan assets		(1,492	)		(1,388	)		—		—
Recognized prior service cost (benefit)		(52	)		(52	)		58		58
Recognized net actuarial losses		452			400			318		400
Net periodic benefit cost	$	252		$	276		$	1,856	$	2,036

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Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2017

Fair Value Disclosures [Abstract]

Financial Instruments Measured at Fair Value on a Recurring and Non-recurring Basis

The results of the fair value hierarchy as of June 30, 2017, are as follows:

Financial Instruments Measured at Fair Value on a Recurring Basis:

	Securities AFS Fair Value Measurements Using
	Carrying Value		Quoted Prices In Active Markets for Identitcal Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)
	(in thousands)
U.S . Treasury	$	1,995	$	—	$	1,995	$	—
U.S . Government Sponsored Enterprises		10,000		—		10,000		—
SBA Backed Securities		71,189		—		71,189		—
U.S . Government Agency and Sponsored Mortgage-Backed Securities		223,782		—		223,782		—
Privately Issued Residential Mortgage-Backed Securities		1,015		—		1,015		—
Obligations Issued by States and Political Subdivisions		98,049		—		—		98,049
Other Debt Securities		4,992		—		4,992		—
Equity Securities		318		318		—		—
Total	$	411,340	$	318	$	312,973	$	98,049
Financial Instruments Measured at Fair Value on a Non-recurring Basis:
Impaired Loans	$	230	$	—	$	—	$	230

The results of the fair value hierarchy as of December 31, 2016, are as follows:

Financial Instruments Measured at Fair Value on a Recurring Basis:

	Securities AFS Fair Value Measurements Using
	Carrying Value		Quoted Prices In Active Markets for Identitcal Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)
	(in thousands)
U.S. Treasury	$	2,000	$	—	$	2,000	$	—
U.S. Government Sponsored Enterprises		24,952		—		24,952		—
SBA Backed Securities		57,767		—		57,767		—
U.S. Government Agency and Sponsored Mortgage-Backed Securities		243,325		—		243,325		—
Privately Issued Residential Mortgage-Backed Securities		1,109		—		1,109		—
Obligations Issued by States and Political Subdivisions		164,876		—		—		164,876
Other Debt Securities		4,924		—		4,924		—
Equity Securities		344		344		—		—
Total	$	499,297	$	344	$	334,077	$	164,876
Financial Instruments Measured at Fair Value on a Non-recurring Basis:
Impaired Loans	$	260	$	—	$	—	$	260

Assets Measured at Fair Value

The following table presents additional information about assets measured at fair value on a recurring and nonrecurring basis for which the Company has utilized Level 3 inputs to determine fair value (dollars in thousands). Management continues to monitor the assumptions used to value the assets listed below.

Asset	Fair Value		Valuation Technique	Unobservable Input	Unobservable Input Value or Range
Securities AFS (4)	$	98,049	Discounted cash flow	Discount rate	0% -1% (3)
Impaired Loans	$	230	Appraisal of collateral (1)	Appraisal adjustments (2)	0%-30% discount

(1) Fair value is generally determined through independent appraisals of the underlying collateral, which generally include various Level 3 inputs which are not identifiable.

(2) Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated expenses.

(3) Weighted averages.

(4) Municipal securities generally have maturities of one year or less and, therefore, the amortized cost equates to the fair value. There was one auction rate security whose fair value is based on the evaluation of the underlying issuer, prevailing interest rates and market liquidity.

The following table presents additional information about assets measured at fair value on a recurring and nonrecurring basis for which the Company has utilized Level 3 inputs to determine fair value (dollars in thousands). Management continues to monitor the assumptions used to value the assets listed below.

Asset	Fair Value		Valuation Technique	Unobservable Input	Unobservable Input Value or Range
Securities AFS (4)	$	164,876	Discounted cash flow	Discount rate	0%-1% (3)
Impaired Loans	$	260	Appraisal of collateral (1)	Appraisal adjustments (2)	0%-30% discount

(1) Fair value is generally determined through independent appraisals of the underlying collateral, which generally include various Level 3 inputs which are not identifiable.

(2) Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated expenses.

(3) Weighted averages

(4) Municipal securities generally have maturities of one year or less and, therefore, the amortized cost equates to the fair value. There was one auction rate security whose fair value is based on the evaluation of the underlying issuer, prevailing interest rates and market liquidity.

Changes in Level 3 Securities

The changes in Level 3 securities for the three month period ended June 30, 2017 are shown in the table below:

	Auction Rate Securities		Obligations Issued by States & Political Subdivisions			Equity Securities		Total
	(in thousands)
Balance at December 31, 2016	$	4,298	$	160,578		$	—	$	164,876
Purchases		—		47,430			—		47,430
Maturities and calls		—		(114,144	)		—		(114,144	)
Amortization		—		(113	)		—		(113	)
Balance at June 30, 2017	$	4,298	$	93,751		$	—	$	98,049

The changes in Level 3 securities for the six month period ended June 30, 2016, are shown in the table below:

	Auction Rate Securities		Obligations Issued by States & Political Subdivisions			Equity Securities			Total
	(in thousands)
Balance at December 31, 2015	$	3,820	$	153,140		$	37		$	156,997
Purchases		—		155,742			—			155,742
Maturities and calls		—		(100,245	)		(37	)		(100,282	)
Amortization		—		(97	)		—			(97	)
Changes in fair value		478		—			—			478
Balance at June 30, 2016	$	4,298	$	208,540		$	—		$	212,838

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Fair Values of Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2017

Investments, All Other Investments [Abstract]

Carrying Amounts and Fair Values of Company's Financial Instruments

The following presents (in thousands) the carrying amount, estimated fair value, and placement in the fair value hierarchy of the Company’s financial instruments as of June 30, 2017 and December 31, 2016. This table excludes financial instruments for which the carrying amount approximates fair value. Financial assets for which the fair value approximates carrying value include cash and cash equivalents, short-term investments, FHLBB stock and accrued interest receivable. Financial liabilities for which the fair value approximates carrying value include non-maturity deposits, short-term borrowings and accrued interest payable.

June 30, 2017	Carrying Amount		Estimated Fair Value		Fair Value Measurements Level 1 Inputs		Fair Value Level 2 Inputs		Fair Value Level 3 Inputs
	(in thousands)
Financial assets:
Securities held-to-maturity	$	1,722,875	$	1,706,840	$	—	$	1,706,840	$	—
Loans (1)		2,008,510		1,987,896		—		—		1,987,896
Financial liabilities:
Time deposits		575,410		577,804		—		577,804		—
Other borrowed funds		455,500		457,252		—		457,252		—
Subordinated debentures		36,083		36,083		—		—		36,083
December 31, 2016
Financial assets:
Securities held-to-maturity	$	1,653,986	$	1,635,808	$	—	$	1,635,808	$	—
Loans (1)		1,899,527		1,873,703		—		—		1,873,703
Financial liabilities:
Time deposits		478,359		480,133		—		480,133		—
Other borrowed funds		293,000		294,940		—		294,940		—
Subordinated debentures		36,083		36,083		—		—		36,083

(1) Comprised of loans (including collateral dependent impaired loans), net of deferred loan costs and the allowance for loan losses.

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Basis of Financial Statement Presentation - Additional Information (Detail)	6 Months Ended
	Jun. 30, 2017 Segment
Basis Of Presentation [Line Items]
Number of reportable segments	1
Century Bancorp Capital Trust II [Member]
Basis Of Presentation [Line Items]
Equity ownership interest	100.00%

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Securities Available-for-Sale - Summary of Securities Available-for-Sale (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	$ 411,709	$ 500,220
Gross Unrealized Gains	780	555
Gross Unrealized Losses	1,149	1,478
Total, Fair Value	411,340	499,297
U.S. Treasury [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	1,999	2,000
Gross Unrealized Losses	4
Total, Fair Value	1,995	2,000
U.S. Government Sponsored Enterprises [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	10,000	25,000
Gross Unrealized Losses		48
Total, Fair Value	10,000	24,952
SBA Backed Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	71,357	57,899
Gross Unrealized Gains	27	14
Gross Unrealized Losses	195	146
Total, Fair Value	71,189	57,767
U.S. Government Agency and Sponsored Mortgage-Backed Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	223,655	243,703
Gross Unrealized Gains	463	293
Gross Unrealized Losses	336	671
Total, Fair Value	223,782	243,325
Privately Issued Residential Mortgage-Backed Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	1,025	1,121
Gross Unrealized Gains	3	2
Gross Unrealized Losses	13	14
Total, Fair Value	1,015	1,109
Obligations Issued by States and Political Subdivisions [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	98,457	165,281
Gross Unrealized Losses	408	405
Total, Fair Value	98,049	164,876
Other Debt Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	5,100	5,100
Gross Unrealized Gains	85	18
Gross Unrealized Losses	193	194
Total, Fair Value	4,992	4,924
Equity Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	116	116
Gross Unrealized Gains	202	228
Total, Fair Value	$ 318	$ 344

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Securities Available-for-Sale - Additional Information (Detail)	3 Months Ended	6 Months Ended
	Jun. 30, 2016 USD ($)	Jun. 30, 2017 USD ($) Security	Jun. 30, 2016 USD ($)	Dec. 31, 2016 USD ($) Security
Schedule of Available-for-sale Securities [Line Items]
Securities at fair value pledged to secure public deposits and repurchase agreements		$ 1,268,349,000		$ 1,147,207,000
Securities available-for-sale are securities at fair value pledged for borrowing		49,416,000		$ 53,396,000
Proceeds from sales of securities available-for-sale		$ 0	$ 1,946,000
Gross gains on sales of securities	$ 45,000		45,000
Federal Home Loan Bank [Member]
Schedule of Available-for-sale Securities [Line Items]
Gross gains on sales of securities			$ 33,000
Securities AFS [Member]
Schedule of Available-for-sale Securities [Line Items]
Weighted average remaining life of investment securities available-for-sale		5 years 4 months 24 days
Number of securities, temporarily impaired for less than 12 months | Security		13		49
Number of securities, temporarily impaired for 12 months or longer | Security		27		15
Number of securities, temporarily impaired, total | Security		269		270
U.S. Government Sponsored Enterprises [Member] | Securities AFS [Member]
Schedule of Available-for-sale Securities [Line Items]
Weighted average remaining life		$ 10,000,000
U.S. Government Agency and Sponsored Mortgage-Backed Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Securities at fair value pledged to secure public deposits and repurchase agreements		$ 173,235,000		$ 210,780,000

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Securities Available-for-Sale - Maturity Distribution of Securities Available-for-Sale (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Investments, Debt and Equity Securities [Abstract]
Within one year, Amortized Cost	$ 90,264
After one but within five years, Amortized Cost	132,716
After five but within ten years, Amortized Cost	105,344
More than 10 years, Amortized Cost	81,769
Non-maturing, Amortized Cost	1,616
Amortized Cost	411,709	$ 500,220
Within one year, Fair Value	90,255
After one but within five years, Fair Value	132,786
After five but within ten years, Fair Value	105,360
More than 10 years, Fair Value	81,270
Non-maturing, Fair Value	1,669
Total, Fair Value	$ 411,340	$ 499,297

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Securities Available-for-Sale - Continuous Unrealized Loss Position for 12 Months or Less and 12 Months or Longer (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
Less than 12 months, Fair Value	$ 66,096	$ 213,363
Less Than 12 Months, Unrealized Losses	203	725
12 Months or Longer, Fair Value	90,807	39,063
12 Months or Longer, Unrealized Losses	946	753
Total, Fair Value	156,903	252,426
Total, Unrealized Losses	1,149	1,478
U.S. Treasury [Member]
Schedule of Available-for-sale Securities [Line Items]
Less than 12 months, Fair Value	1,995
Less Than 12 Months, Unrealized Losses	4
Total, Fair Value	1,995
Total, Unrealized Losses	4
U.S. Government Sponsored Enterprises [Member]
Schedule of Available-for-sale Securities [Line Items]
Less than 12 months, Fair Value		24,952
Less Than 12 Months, Unrealized Losses		48
Total, Fair Value		24,952
Total, Unrealized Losses		48
SBA Backed Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Less than 12 months, Fair Value	27,850	52,346
Less Than 12 Months, Unrealized Losses	116	145
12 Months or Longer, Fair Value	17,775	951
12 Months or Longer, Unrealized Losses	79	1
Total, Fair Value	45,625	53,297
Total, Unrealized Losses	195	146
U.S. Government Agency and Sponsored Mortgage-Backed Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Less than 12 months, Fair Value	36,251	135,612
Less Than 12 Months, Unrealized Losses	83	485
12 Months or Longer, Fair Value	66,121	31,504
12 Months or Longer, Unrealized Losses	253	186
Total, Fair Value	102,372	167,116
Total, Unrealized Losses	336	671
Privately Issued Residential Mortgage-Backed Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
12 Months or Longer, Fair Value	707	757
12 Months or Longer, Unrealized Losses	13	14
Total, Fair Value	707	757
Total, Unrealized Losses	13	14
Obligations Issued by States and Political Subdivisions [Member]
Schedule of Available-for-sale Securities [Line Items]
12 Months or Longer, Fair Value	4,297	4,298
12 Months or Longer, Unrealized Losses	408	405
Total, Fair Value	4,297	4,298
Total, Unrealized Losses	408	405
Other Debt Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Less than 12 months, Fair Value		453
Less Than 12 Months, Unrealized Losses		47
12 Months or Longer, Fair Value	1,907	1,553
12 Months or Longer, Unrealized Losses	193	147
Total, Fair Value	1,907	2,006
Total, Unrealized Losses	$ 193	$ 194

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Investment Securities Held-to-Maturity - Summary of Held-to-Maturity Securities (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Schedule of Held-to-maturity Securities [Line Items]
Amortized Cost	$ 1,722,875	$ 1,653,986
Gross Unrealized Gains	6,353	6,014
Gross Unrealized Losses	22,388	24,192
Estimated Fair Value	1,706,840	1,635,808
U.S. Government Sponsored Enterprises [Member]
Schedule of Held-to-maturity Securities [Line Items]
Amortized Cost	134,378	148,326
Gross Unrealized Gains	931	1,066
Gross Unrealized Losses	287	527
Estimated Fair Value	135,022	148,865
SBA Backed Securities [Member]
Schedule of Held-to-maturity Securities [Line Items]
Amortized Cost	54,427	46,140
Gross Unrealized Gains	3
Gross Unrealized Losses	779	1,088
Estimated Fair Value	53,651	45,052
U.S. Government Agency and Sponsored Mortgage-Backed Securities [Member]
Schedule of Held-to-maturity Securities [Line Items]
Amortized Cost	1,534,070	1,459,520
Gross Unrealized Gains	5,419	4,948
Gross Unrealized Losses	21,322	22,577
Estimated Fair Value	$ 1,518,167	$ 1,441,891

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Investment Securities Held-to-Maturity - Additional Information (Detail)	6 Months Ended
	Jun. 30, 2017 USD ($) Security	Jun. 30, 2016 USD ($)	Dec. 31, 2016 USD ($) Security
Schedule of Held-to-maturity Securities [Line Items]
Securities at fair value pledged to secure public deposits and repurchase agreements	$ 1,268,349,000		$ 1,147,207,000
Proceeds from sales of securities held-to-maturity	0	$ 192,000
Realized gross gains from sales of securities held-to-maturity	$ 12,000
Held-to-Maturity Securities [Member]
Schedule of Held-to-maturity Securities [Line Items]
Weighted average remaining life of investment securities held-to-maturity	4 years 4 months 24 days
Number of securities, temporarily impaired for less than 12 months | Security	190		194
Number of securities, temporarily impaired for 12 months or longer | Security	22		16
Number of securities, temporarily impaired, total | Security	393		375
Held-to-Maturity Securities [Member] | U.S. Government Sponsored Enterprises [Member]
Schedule of Held-to-maturity Securities [Line Items]
Weighted average remaining life	$ 35,496,000
Federal Home Loan Bank [Member]
Schedule of Held-to-maturity Securities [Line Items]
Securities pledged for borrowing at the Federal Home Loan Bank	$ 305,269,000		$ 424,353,000

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Investment Securities Held-to-Maturity - Company's Securities Held-to-Maturity (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Investments, Debt and Equity Securities [Abstract]
Within one year, Amortized Cost	$ 45,780
After one but within five years, Amortized Cost	1,224,104
After five but within ten years, Amortized Cost	449,698
More than ten years, Amortized Cost	3,293
Amortized Cost	1,722,875	$ 1,653,986
Within one year, Fair Value	45,827
After one but within five years, Fair Value	1,213,863
After five but within ten years, Fair Value	444,027
More than ten years, Fair Value	3,123
Estimated Fair Value	$ 1,706,840	$ 1,635,808

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Investment Securities Held-to-Maturity - Unrealized Market Loss of Securities (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Schedule of Held-to-maturity Securities [Line Items]
Less Than 12 Months, Fair Value	$ 1,111,732	$ 1,113,231
Less Than 12 Months, Unrealized Losses	20,030	22,340
12 Months or Longer, Fair Value	76,584	58,535
12 Months or Longer, Unrealized Losses	2,358	1,852
Total, Fair Value	1,188,316	1,171,766
Total, Unrealized Losses	22,388	24,192
U.S. Government Sponsored Enterprises [Member]
Schedule of Held-to-maturity Securities [Line Items]
Less Than 12 Months, Fair Value	45,209	59,219
Less Than 12 Months, Unrealized Losses	287	527
Total, Fair Value	45,209	59,219
Total, Unrealized Losses	287	527
SBA Backed Securities [Member]
Schedule of Held-to-maturity Securities [Line Items]
Less Than 12 Months, Fair Value	50,633	45,052
Less Than 12 Months, Unrealized Losses	779	1,088
Total, Fair Value	50,633	45,052
Total, Unrealized Losses	779	1,088
U.S. Government Agency and Sponsored Mortgage-Backed Securities [Member]
Schedule of Held-to-maturity Securities [Line Items]
Less Than 12 Months, Fair Value	1,015,890	1,008,960
Less Than 12 Months, Unrealized Losses	18,964	20,725
12 Months or Longer, Fair Value	76,584	58,535
12 Months or Longer, Unrealized Losses	2,358	1,852
Total, Fair Value	1,092,474	1,067,495
Total, Unrealized Losses	$ 21,322	$ 22,577

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Allowance for Loan Losses - Analysis of Allowance for Loan Losses (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Receivables [Abstract]
Allowance for loan losses, beginning of period	$ 24,827	$ 23,544	$ 24,406	$ 23,075
Adjustment		(84)		(84)
Loans charged off	(100)	(111)	(197)	(180)
Recoveries on loans previously charged-off	72	164	190	252
Net (charge-offs) / recoveries	(28)	53	(7)	72
Provision charged to expense	490	350	890	800
Allowance for loan losses, end of period	$ 25,289	$ 23,863	$ 25,289	$ 23,863

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Allowance for Loan Losses - Summary of Allowance for Loan Losses (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Allowance for loan losses:
Allowance for loan losses, beginning of period	$ 24,827	$ 23,544	$ 24,406	$ 23,075
Charge-offs	(100)	(111)	(197)	(180)
Recoveries	72	164	190	252
Provision	490	350	890	800
Reclassification to other liabilities		(84)		(84)
Allowance for loan losses, end of period	25,289	23,863	25,289	23,863
Amount of allowance for loan losses for loans deemed to be impaired	200	174	200	174
Amount of allowance for loan losses for loans not deemed to be impaired	25,089	23,689	25,089	23,689
Loans:
Total loans, net	2,033,799	1,801,904	2,033,799	1,801,904	$ 1,923,933
Loans deemed to be impaired	7,311	4,457	7,311	4,457
Loans not deemed to be impaired	2,026,488	1,797,447	2,026,488	1,797,447
Construction and Land Development [Member]
Allowance for loan losses:
Allowance for loan losses, beginning of period	873	1,973	1,012	2,041
Provision	264	264	125	196
Reclassification to other liabilities		(3)		(3)
Allowance for loan losses, end of period	1,137	2,234	1,137	2,234
Amount of allowance for loan losses for loans deemed to be impaired		6		6
Amount of allowance for loan losses for loans not deemed to be impaired	1,137	2,228	1,137	2,228
Loans:
Total loans, net	14,159	31,178	14,159	31,178	14,928
Loans deemed to be impaired		96		96
Loans not deemed to be impaired	14,159	31,082	14,159	31,082
Commercial and Industrial [Member]
Allowance for loan losses:
Allowance for loan losses, beginning of period	7,369	6,693	6,972	5,899
Charge-offs	(29)		(29)
Recoveries	34	56	54	91
Provision	189	(878)	566	(119)
Reclassification to other liabilities		(29)		(29)
Allowance for loan losses, end of period	7,563	5,842	7,563	5,842
Amount of allowance for loan losses for loans deemed to be impaired	11	10	11	10
Amount of allowance for loan losses for loans not deemed to be impaired	7,552	5,832	7,552	5,832
Loans:
Total loans, net	650,542	493,033	650,542	493,033	612,503
Loans deemed to be impaired	365	410	365	410
Loans not deemed to be impaired	650,177	492,623	650,177	492,623
Municipal [Member]
Allowance for loan losses:
Allowance for loan losses, beginning of period	1,899	990	1,612	994
Provision	(40)	811	247	807
Allowance for loan losses, end of period	1,859	1,801	1,859	1,801
Amount of allowance for loan losses for loans not deemed to be impaired	1,859	1,801	1,859	1,801
Loans:
Total loans, net	127,259	134,386	127,259	134,386	135,418
Loans not deemed to be impaired	127,259	134,386	127,259	134,386
Commercial Real Estate [Member]
Allowance for loan losses:
Allowance for loan losses, beginning of period	11,216	10,533	11,135	10,589
Provision	(188)	128	(107)	72
Reclassification to other liabilities		(11)		(11)
Allowance for loan losses, end of period	11,028	10,650	11,028	10,650
Amount of allowance for loan losses for loans deemed to be impaired	120	151	120	151
Amount of allowance for loan losses for loans not deemed to be impaired	10,908	10,499	10,908	10,499
Loans:
Total loans, net	736,603	728,658	736,603	728,658	696,173
Loans deemed to be impaired	2,603	3,736	2,603	3,736
Loans not deemed to be impaired	734,000	724,922	734,000	724,922
Residential Real Estate [Member]
Allowance for loan losses:
Allowance for loan losses, beginning of period	1,671	1,249	1,698	1,320
Recoveries		2	2	3
Provision	447	53	418	(19)
Reclassification to other liabilities		(2)		(2)
Allowance for loan losses, end of period	2,118	1,302	2,118	1,302
Amount of allowance for loan losses for loans deemed to be impaired	69	7	69	7
Amount of allowance for loan losses for loans not deemed to be impaired	2,049	1,295	2,049	1,295
Loans:
Total loans, net	264,744	219,494	264,744	219,494	241,357
Loans deemed to be impaired	4,343	215	4,343	215
Loans not deemed to be impaired	260,401	219,279	260,401	219,279
Consumer [Member]
Allowance for loan losses:
Allowance for loan losses, beginning of period	452	693	582	644
Charge-offs	(71)	(111)	(168)	(180)
Recoveries	38	106	134	158
Provision	(224)	(77)	(353)	(11)
Reclassification to other liabilities		(3)		(3)
Allowance for loan losses, end of period	195	608	195	608
Amount of allowance for loan losses for loans not deemed to be impaired	195	608	195	608
Loans:
Total loans, net	11,218	11,339	11,218	11,339	11,697
Loans not deemed to be impaired	11,218	11,339	11,218	11,339
Home Equity [Member]
Allowance for loan losses:
Allowance for loan losses, beginning of period	1,050	1,185	1,102	1,077
Provision	96	9	44	117
Reclassification to other liabilities		(36)		(36)
Allowance for loan losses, end of period	1,146	1,158	1,146	1,158
Amount of allowance for loan losses for loans not deemed to be impaired	1,146	1,158	1,146	1,158
Loans:
Total loans, net	229,274	183,816	229,274	183,816	$ 211,857
Loans not deemed to be impaired	229,274	183,816	229,274	183,816
Unallocated [Member]
Allowance for loan losses:
Allowance for loan losses, beginning of period	297	228	293	511
Provision	(54)	40	(50)	(243)
Allowance for loan losses, end of period	243	268	243	268
Amount of allowance for loan losses for loans not deemed to be impaired	$ 243	$ 268	$ 243	$ 268

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Allowance for Loan Losses - Loans by Risk Rating (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016	Jun. 30, 2016
Loans by risk rating
Financing Receivable, Net	$ 2,033,799	$ 1,923,933	$ 1,801,904
Construction and Land Development [Member]
Loans by risk rating
Financing Receivable, Net	14,159	14,928	31,178
Commercial and Industrial [Member]
Loans by risk rating
Financing Receivable, Net	650,542	612,503	493,033
Municipal [Member]
Loans by risk rating
Financing Receivable, Net	127,259	135,418	134,386
Commercial Real Estate [Member]
Loans by risk rating
Financing Receivable, Net	736,603	696,173	$ 728,658
1-3 (Pass) [Member] | Construction and Land Development [Member]
Loans by risk rating
Financing Receivable, Net	14,159	14,834
1-3 (Pass) [Member] | Commercial and Industrial [Member]
Loans by risk rating
Financing Receivable, Net	650,177	612,114
1-3 (Pass) [Member] | Municipal [Member]
Loans by risk rating
Financing Receivable, Net	127,259	135,418
1-3 (Pass) [Member] | Commercial Real Estate [Member]
Loans by risk rating
Financing Receivable, Net	704,531	661,271
4 (Monitor) [Member] | Commercial Real Estate [Member]
Loans by risk rating
Financing Receivable, Net	29,469	31,753
Impaired [Member] | Construction and Land Development [Member]
Loans by risk rating
Financing Receivable, Net		94
Impaired [Member] | Commercial and Industrial [Member]
Loans by risk rating
Financing Receivable, Net	365	389
Impaired [Member] | Commercial Real Estate [Member]
Loans by risk rating
Financing Receivable, Net	$ 2,603	$ 3,149

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Allowance for Loan Losses - Loans by Credit Rating (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Financing Receivable, Recorded Investment [Line Items]
Loans and leases receivable net of deferred income credit quality	$ 984,725	$ 917,026
Aaa - Aa3 [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans and leases receivable net of deferred income credit quality	453,876	407,515
A1 - A3 [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans and leases receivable net of deferred income credit quality	355,374	351,565
Baa1 - Baa3 [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans and leases receivable net of deferred income credit quality	172,745	154,336
Ba2 [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans and leases receivable net of deferred income credit quality	2,730	3,610
Commercial and Industrial [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans and leases receivable net of deferred income credit quality	559,999	523,451
Commercial and Industrial [Member] | Aaa - Aa3 [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans and leases receivable net of deferred income credit quality	341,777	334,674
Commercial and Industrial [Member] | A1 - A3 [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans and leases receivable net of deferred income credit quality	218,222	188,777
Municipal [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans and leases receivable net of deferred income credit quality	124,409	130,190
Municipal [Member] | Aaa - Aa3 [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans and leases receivable net of deferred income credit quality	66,484	66,245
Municipal [Member] | A1 - A3 [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans and leases receivable net of deferred income credit quality	8,225	33,365
Municipal [Member] | Baa1 - Baa3 [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans and leases receivable net of deferred income credit quality	46,970	26,970
Municipal [Member] | Ba2 [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans and leases receivable net of deferred income credit quality	2,730	3,610
Commercial Real Estate [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans and leases receivable net of deferred income credit quality	300,317	263,385
Commercial Real Estate [Member] | Aaa - Aa3 [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans and leases receivable net of deferred income credit quality	45,615	6,596
Commercial Real Estate [Member] | A1 - A3 [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans and leases receivable net of deferred income credit quality	128,927	129,423
Commercial Real Estate [Member] | Baa1 - Baa3 [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans and leases receivable net of deferred income credit quality	$ 125,775	$ 127,366

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Allowance for Loan Losses - Aging of Past Due Loans (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016	Jun. 30, 2016
Financing Receivable, Allowance for Credit Losses [Line Items]
Accruing 30-89 Days Past Due	$ 3,206	$ 1,614
Non Accrual	1,122	1,084
Accruing Greater than 90 Days	0	0
Total Past Due	4,328	2,698
Current Loans	2,029,471	1,921,235
Total loans, net	2,033,799	1,923,933	$ 1,801,904
Construction and Land Development [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Non Accrual		94
Accruing Greater than 90 Days	0	0
Total Past Due		94
Current Loans	14,159	14,834
Total loans, net	14,159	14,928	31,178
Commercial and Industrial [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Accruing 30-89 Days Past Due	404	37
Non Accrual	49	65
Accruing Greater than 90 Days	0	0
Total Past Due	453	102
Current Loans	650,089	612,401
Total loans, net	650,542	612,503	493,033
Municipal [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Accruing Greater than 90 Days	0	0
Current Loans	127,259	135,418
Total loans, net	127,259	135,418	134,386
Commercial Real Estate [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Accruing 30-89 Days Past Due	455	597
Non Accrual	230	150
Accruing Greater than 90 Days	0	0
Total Past Due	685	747
Current Loans	735,918	695,426
Total loans, net	736,603	696,173	728,658
Residential Real Estate [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Accruing 30-89 Days Past Due	984	245
Non Accrual	735	656
Accruing Greater than 90 Days	0	0
Total Past Due	1,719	901
Current Loans	263,025	240,456
Total loans, net	264,744	241,357	219,494
Consumer [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Accruing 30-89 Days Past Due	6
Non Accrual	1	11
Accruing Greater than 90 Days	0	0
Total Past Due	7	11
Current Loans	11,211	11,686
Total loans, net	11,218	11,697	11,339
Home Equity [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Accruing 30-89 Days Past Due	1,357	735
Non Accrual	107	108
Accruing Greater than 90 Days	0	0
Total Past Due	1,464	843
Current Loans	227,810	211,014
Total loans, net	$ 229,274	$ 211,857	$ 183,816

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Allowance for Loan Losses - Information Pertaining to Impaired Loans (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Financing Receivable, Allowance for Credit Losses [Line Items]
With no required reserve recorded, Carrying Value	$ 128	$ 751	$ 128	$ 751
With no required reserve recorded, Unpaid Balance Principal	417	1,025	417	1,025
With no required reserve recorded, Required Reserve	0	0	0	0
With no required reserve recorded, Average Carrying Value Recognized	418	489	548	352
With no required reserve recorded, Interest Income	2	18	3	26
With required reserve recorded, Carrying Value	7,183	3,706	7,183	3,706
With required reserve recorded, Unpaid Balance Principal	7,324	3,832	7,324	3,832
With required reserve recorded, Required Reserve	200	174	200	174
With required reserve recorded, Average Carrying Value Recognized	4,086	2,802	3,661	2,905
With required reserve recorded, Interest Income	52	26	81	45
Carrying Value	7,311	4,457	7,311	4,457
Unpaid Balance Principal	7,741	4,857	7,741	4,857
With required reserve recorded, Required Reserve	200	174	200	174
Average Carrying Value Recognized	4,504	3,291	4,209	3,257
Interest Income	54	44	84	71
Construction and Land Development [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
With no required reserve recorded, Required Reserve	0	0	0	0
With required reserve recorded, Carrying Value		96		96
With required reserve recorded, Unpaid Balance Principal		108		108
With required reserve recorded, Required Reserve		6		6
With required reserve recorded, Average Carrying Value Recognized	69	97	80	97
Carrying Value		96		96
Unpaid Balance Principal		108		108
With required reserve recorded, Required Reserve		6		6
Average Carrying Value Recognized	69	97	80	97
Commercial and Industrial [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
With no required reserve recorded, Carrying Value	49	52	49	52
With no required reserve recorded, Unpaid Balance Principal	248	239	248	239
With no required reserve recorded, Required Reserve	0	0	0	0
With no required reserve recorded, Average Carrying Value Recognized	43	54	43	56
With required reserve recorded, Carrying Value	316	358	316	358
With required reserve recorded, Unpaid Balance Principal	331	373	331	373
With required reserve recorded, Required Reserve	11	10	11	10
With required reserve recorded, Average Carrying Value Recognized	326	370	332	374
With required reserve recorded, Interest Income	4	5	8	9
Carrying Value	365	410	365	410
Unpaid Balance Principal	579	612	579	612
With required reserve recorded, Required Reserve	11	10	11	10
Average Carrying Value Recognized	369	424	375	430
Interest Income	4	5	8	9
Municipal [Member] | Municipal [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
With no required reserve recorded, Required Reserve	0	0	0	0
Commercial Real Estate [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
With no required reserve recorded, Carrying Value		596		596
With no required reserve recorded, Unpaid Balance Principal		596		596
With no required reserve recorded, Required Reserve	0	0	0	0
With no required reserve recorded, Average Carrying Value Recognized	294	329	421	188
With no required reserve recorded, Interest Income		16		22
With required reserve recorded, Carrying Value	2,603	3,140	2,603	3,140
With required reserve recorded, Unpaid Balance Principal	2,728	3,239	2,728	3,239
With required reserve recorded, Required Reserve	120	151	120	151
With required reserve recorded, Average Carrying Value Recognized	2,546	2,030	2,548	1,878
With required reserve recorded, Interest Income	24	20	48	33
Carrying Value	2,603	3,736	2,603	3,736
Unpaid Balance Principal	2,728	3,835	2,728	3,835
With required reserve recorded, Required Reserve	120	151	120	151
Average Carrying Value Recognized	2,840	2,359	2,969	2,066
Interest Income	24	36	48	55
Residential Real Estate [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
With no required reserve recorded, Carrying Value	79	103	79	103
With no required reserve recorded, Unpaid Balance Principal	169	190	169	190
With no required reserve recorded, Required Reserve	0	0	0	0
With no required reserve recorded, Average Carrying Value Recognized	81	106	84	108
With no required reserve recorded, Interest Income	2	2	3	4
With required reserve recorded, Carrying Value	4,264	112	4,264	112
With required reserve recorded, Unpaid Balance Principal	4,265	112	4,265	112
With required reserve recorded, Required Reserve	69	7	69	7
With required reserve recorded, Average Carrying Value Recognized	1,145	283	701	505
With required reserve recorded, Interest Income	24	1	25	3
Carrying Value	4,343	215	4,343	215
Unpaid Balance Principal	4,434	302	4,434	302
With required reserve recorded, Required Reserve	69	7	69	7
Average Carrying Value Recognized	1,226	389	785	613
Interest Income	26	3	28	7
Consumer [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
With no required reserve recorded, Required Reserve	0	0	0	0
Home Equity [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
With no required reserve recorded, Required Reserve	$ 0	0	$ 0	0
With required reserve recorded, Average Carrying Value Recognized		22		51
Average Carrying Value Recognized		$ 22		$ 51

XML

Allowances for Loan Losses - Additional Information (Detail) - Commercial Portfolio Segment [Member]	6 Months Ended
	Jun. 30, 2016 USD ($) Contracts
Financing Receivable, Allowance for Credit Losses [Line Items]
Number of troubled debt restructurings | Contracts	1
Pre-modification outstanding recorded investment	$ 2,091,000
Post-modification outstanding recorded investment	2,091,000
Financing allowance reduction in principal payments	3,000
Financing allowance reduction in interest payments	$ 1,000

XML

Reclassifications Out of Accumulated Other Comprehensive Income - Reclassifications Out of Accumulated Other Comprehensive Income (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Net gains on sales of securities		$ 45		$ 45
Provision for income taxes	$ (552)	(20)	$ (696)	(84)
Net income	8,157	6,241	14,253	11,549
Salaries and employee benefits	(10,719)	(10,040)	(21,862)	(19,816)
Reclassification Out of Accumulated Other Comprehensive Income [Member] | Unrealized Gains and Losses on Available-for-Sale Securities [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Net gains on sales of securities		45		45
Provision for income taxes		(18)		(18)
Net income		27		27
Reclassification Out of Accumulated Other Comprehensive Income [Member] | Accretion of Unrealized Losses Transferred [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Net gains on sales of securities	(662)	(1,170)	(1,324)	(2,682)
Provision for income taxes	402	408	691	935
Net income	(260)	(762)	(633)	(1,747)
Reclassification Out of Accumulated Other Comprehensive Income [Member] | Prior-Service Costs [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Salaries and employee benefits	(3)	(3)	(6)	(5)
Reclassification Out of Accumulated Other Comprehensive Income [Member] | Actuarial Gains (Losses) [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Salaries and employee benefits	(385)	(401)	(770)	(802)
Reclassification Out of Accumulated Other Comprehensive Income [Member] | Amortization of Defined Benefit Pension Items [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Income before taxes	(388)	(404)	(776)	(807)
Provision for income taxes	155	161	311	322
Net income	$ (233)	$ (243)	$ (465)	$ (485)

XML

Earnings per Share ("EPS") - Additional Information (Detail) - Class A Common Stock [Member] - shares	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
Number of Stock options outstanding	0	0
Minimum [Member]
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
Class A common stock entitled dividend per share percent in comparison to Class B common stock	200.00%

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Earnings Per Share ("EPS") - Reconciliation of Basic EPS and Diluted EPS (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
Net income	$ 8,157	$ 6,241	$ 14,253	$ 11,549
Class A Common Stock [Member]
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
Net income	$ 6,410	$ 4,902	$ 11,198	$ 9,071
Weighted average shares outstanding, basic	3,603,729	3,600,729	3,602,229	3,600,729
Basic earnings per share	$ 1.78	$ 1.36	$ 3.11	$ 2.52
Net income	$ 6,410	$ 4,902	$ 11,198	$ 9,071
Weighted average shares outstanding, diluted	5,567,909	5,567,909	5,567,909	5,567,909
Diluted earnings per share	$ 1.47	$ 1.12	$ 2.56	$ 2.07
Class B Common Stock [Member]
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
Net income	$ 1,747	$ 1,339	$ 3,055	$ 2,478
Weighted average shares outstanding, basic	1,964,180	1,967,180	1,965,680	1,967,180
Basic earnings per share	$ 0.89	$ 0.68	$ 1.55	$ 1.26
Net income	$ 1,747	$ 1,339	$ 3,055	$ 2,478
Weighted average shares outstanding, diluted	1,964,180	1,967,180	1,965,680	1,967,180
Diluted earnings per share	$ 0.89	$ 0.68	$ 1.55	$ 1.26

XML

Employee Benefits - Additional Information (Detail)	6 Months Ended
	Jun. 30, 2017 USD ($)
Retirement Benefits [Abstract]
Number of years service to participate in supplemental plan	1 year
Current fiscal year contribution to pension plan	$ 500,000
Employer expected contribution to Pension Plan in 2017	$ 1,000,000

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Employee Benefits - Components of Net Periodic Benefit Cost (Credit) (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Defined Benefit Pension Plan [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 310	$ 318	$ 620	$ 636
Interest	362	340	724	680
Expected return on plan assets	(746)	(694)	(1,492)	(1,388)
Recognized prior service cost (benefit)	(26)	(26)	(52)	(52)
Recognized net actuarial losses	226	200	452	400
Net periodic benefit cost	126	138	252	276
Supplemental Insurance/ Retirement Plan [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	395	455	790	910
Interest	345	334	690	668
Recognized prior service cost (benefit)	29	29	58	58
Recognized net actuarial losses	159	200	318	400
Net periodic benefit cost	$ 928	$ 1,018	$ 1,856	$ 2,036

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Fair Value Measurements - Financial Instruments Measured at Fair Value on a Recurring and Non-recurring Basis (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	$ 411,340	$ 499,297
Fair Value Measurements, Level 1 Inputs [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	318	344
Fair Value Measurements, Level 2 Inputs [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	312,973	334,077
Fair Value Measurements, Level 3 Inputs [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	98,049	164,876
Financial Instruments Measured at Fair Value on a Non-recurring Basis
Impaired Loans	230	260
U.S. Treasury [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	1,995	2,000
U.S. Treasury [Member] | Fair Value Measurements, Level 2 Inputs [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	1,995	2,000
SBA Backed Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	71,189	57,767
SBA Backed Securities [Member] | Fair Value Measurements, Level 2 Inputs [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	71,189	57,767
U.S. Government Agency and Sponsored Mortgage-Backed Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	223,782	243,325
U.S. Government Agency and Sponsored Mortgage-Backed Securities [Member] | Fair Value Measurements, Level 2 Inputs [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	223,782	243,325
Privately Issued Residential Mortgage-Backed Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	1,015	1,109
Privately Issued Residential Mortgage-Backed Securities [Member] | Fair Value Measurements, Level 2 Inputs [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	1,015	1,109
Obligations Issued by States and Political Subdivisions [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	98,049	164,876
Obligations Issued by States and Political Subdivisions [Member] | Fair Value Measurements, Level 3 Inputs [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	98,049	164,876
Other Debt Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	4,992	4,924
Other Debt Securities [Member] | Fair Value Measurements, Level 2 Inputs [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	4,992	4,924
Equity Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	318	344
Equity Securities [Member] | Fair Value Measurements, Level 1 Inputs [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	318	344
U.S. Government Sponsored Enterprises [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	10,000	24,952
U.S. Government Sponsored Enterprises [Member] | Fair Value Measurements, Level 2 Inputs [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	10,000	24,952
Carrying Value [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	411,340	499,297
Financial Instruments Measured at Fair Value on a Non-recurring Basis
Impaired Loans	230	260
Carrying Value [Member] | U.S. Treasury [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	1,995	2,000
Carrying Value [Member] | SBA Backed Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	71,189	57,767
Carrying Value [Member] | U.S. Government Agency and Sponsored Mortgage-Backed Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	223,782	243,325
Carrying Value [Member] | Privately Issued Residential Mortgage-Backed Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	1,015	1,109
Carrying Value [Member] | Obligations Issued by States and Political Subdivisions [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	98,049	164,876
Carrying Value [Member] | Other Debt Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	4,992	4,924
Carrying Value [Member] | Equity Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	318	344
Carrying Value [Member] | U.S. Government Sponsored Enterprises [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities AFS	$ 10,000	$ 24,952

XML

Fair Value Measurements - Additional Information (Detail) - USD ($)	3 Months Ended	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Jun. 30, 2017	Dec. 31, 2016	Jun. 30, 2016
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Specific adjustments to impaired loans recognized	$ 4,000	$ (5,000)	$ (135,000)
Transfers between level 1, 2 and 3		0	0
Liabilities measured at fair value on a recurring or nonrecurring basis	0	0	$ 0
Fair Value Measurements, Level 3 Inputs [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Amortized cost of Level 3 securities	98,457,000	98,457,000		$ 213,241,000
Unrealized loss	$ 408,000	$ 408,000		$ 403,000

XML

Fair Value Measurements - Assets Measured at Fair Value (Detail) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Securities AFS [Member]
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Line Items]
Fair Value	$ 98,049	$ 164,876
Valuation Technique	Discounted cash flow
Unobservable Input	Discount rate
Impaired Loans [Member]
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Line Items]
Fair Value	$ 230	$ 260
Valuation Technique	Appraisal of collateral
Unobservable Input	Appraisal adjustments
Minimum [Member] | Securities AFS [Member]
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Line Items]
Unobservable Input Value or Range	0.00%	0.00%
Minimum [Member] | Impaired Loans [Member]
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Line Items]
Unobservable Input Value or Range	0.00%	0.00%
Maximum [Member] | Securities AFS [Member]
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Line Items]
Unobservable Input Value or Range	1.00%	1.00%
Maximum [Member] | Impaired Loans [Member]
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Line Items]
Unobservable Input Value or Range	30.00%	30.00%

XML

Fair Value Measurements - Assets Measured at Fair Value (Parenthetical) (Detail)	6 Months Ended
	Jun. 30, 2017
Municipal [Member]
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Line Items]
Securities maturity period	one year or less

XML

Fair Value Measurements - Changes in Level 3 Securities (Detail) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Beginning Balance	$ 164,876	$ 156,997
Purchases	47,430	155,742
Maturities and calls	(114,144)	(100,282)
Amortization	(113)	(97)
Changes in fair value		478
Ending Balance	98,049	212,838
Auction Rate Securities [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Beginning Balance	4,298	3,820
Changes in fair value		478
Ending Balance	4,298	4,298
Obligations Issued by States and Political Subdivisions [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Beginning Balance	160,578	153,140
Purchases	47,430	155,742
Maturities and calls	(114,144)	(100,245)
Amortization	(113)	(97)
Ending Balance	$ 93,751	208,540
Equity Securities [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Beginning Balance		37
Maturities and calls		$ (37)

XML

Fair Values of Financial Instruments - Carrying Amount and Fair Value of Company's Financial Instruments (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Financial assets:
Securities held-to-maturity	$ 1,722,875	$ 1,653,986
Loans	2,008,510	1,899,527
Financial liabilities:
Time deposits	575,410	478,359
Other borrowed funds	455,500	293,000
Subordinated debentures	36,083	36,083
Carrying Value [Member]
Financial assets:
Securities held-to-maturity	1,722,875	1,653,986
Loans	2,008,510	1,899,527
Financial liabilities:
Time deposits	575,410	478,359
Other borrowed funds	455,500	293,000
Subordinated debentures	36,083	36,083
Estimated Fair Value [Member]
Financial assets:
Securities held-to-maturity	1,706,840	1,635,808
Loans	1,987,896	1,873,703
Financial liabilities:
Time deposits	577,804	480,133
Other borrowed funds	457,252	294,940
Subordinated debentures	36,083	36,083
Fair Value Measurements, Level 2 Inputs [Member]
Financial assets:
Securities held-to-maturity	1,706,840	1,635,808
Financial liabilities:
Time deposits	577,804	480,133
Other borrowed funds	457,252	294,940
Fair Value Measurements, Level 3 Inputs [Member]
Financial assets:
Loans	1,987,896	1,873,703
Financial liabilities:
Subordinated debentures	$ 36,083	$ 36,083