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 March 31, 2017

OR

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

For the transition period from to

Commission File Number 001-35638

___________________________________________________________________________________

WSFS FINANCIAL CORPORATION

(Exact name of registrant as specified in its charter)

___________________________________________________________________________________

Delaware	22-2866913
(State or other jurisdiction of Incorporation or organization)	(I.R.S. Employer Identification Number)
WSFS Bank Center, 500 Delaware Avenue, Wilmington, Delaware 19801
(Address of principal executive offices)
(302) 792-6000
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), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or 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 or a smaller reporting 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.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐  (Do not check if 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  ☒

The Registrant had 31,452,055 shares of common stock, par value $0.01 per share, outstanding at May 5, 2017.

WSFS FINANCIAL CORPORATION

FORM 10-Q

TABLE OF CONTENTS

PART I. Financial Information
		Page
	Forward Looking Statements	3
Item 1.	Financial Statements (Unaudited)
	Consolidated Statements of Income for the Three Months Ended March 31, 2017 and 2016	5
	Consolidated Statements of Comprehensive Income for the Three Months Ended March 31, 2017 and 2016	6
	Consolidated Statements of Financial Condition as of March 31, 2017 and December 31, 2016	7
	Consolidated Statements of Stockholders' Equity for the Three Months Ended March 31, 2017 and 2016	8
	Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2017 and 2016	9
	Notes to the Consolidated Financial Statements for the Three Months Ended March 31, 2017 and 2016	11
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	46
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	56
Item 4.	Controls and Procedures	56
PART II. Other Information
Item 1.	Legal Proceedings	57
Item 1A.	Risk Factors	57
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	57
Item 3.	Defaults upon Senior Securities	58
Item 4.	Mine Safety Disclosure	58
Item 5.	Other Information	58
Item 6.	Exhibits	58
	Signatures
Exhibit 31.1	Certification of CEO Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Exhibit 31.2	Certification of CFO Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Exhibit 32	Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Exhibit 101.INS	Instance Document
Exhibit 101.SCH	Schema Document
Exhibit 101.CAL	Calculation Linkbase Document
Exhibit 101.LAB	Labels Linkbase Document
Exhibit 101.PRE	Presentation Linkbase Document
Exhibit 101.DEF	Definition Linkbase Document

2

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q, and exhibits thereto, contains estimates, predictions, opinions, projections and other “forward-looking statements” as that phrase is defined in the Private Securities Litigation Reform Act of 1995. Such statements include, without limitation, references to the Company’s predictions or expectations of future business or financial performance as well as its goals and objectives for future operations, financial and business trends, business prospects and management’s outlook or expectations for earnings, revenues, expenses, capital levels, liquidity levels, asset quality or other future financial or business performance, strategies or expectations. The words “believe,” “expect,” “anticipate,” “plan,” “estimate,” “target,” “project” and similar expressions, among others, generally identify forward-looking statements. Such forward-looking statements are based on various assumptions (some of which may be beyond the Company’s control) and are subject to risks and uncertainties (which change over time) and other factors which could cause actual results to differ materially from those currently anticipated. Such risks and uncertainties include, but are not limited to:

• those related to difficult market conditions and unfavorable economic trends in the United States generally, and particularly in the markets in which the Company operates and in which its loans are concentrated, including the effects of declines in housing markets, an increase in unemployment levels and slowdowns in economic growth;

• the Company’s level of nonperforming assets and the costs associated with resolving problem loans including litigation and other costs;

• possible additional loan losses and impairment in the collectability of loans;

• changes in market interest rates, which may increase funding costs and reduce earning asset yields and thus reduce margin;

• the impact of changes in interest rates and the credit quality and strength of underlying collateral and the effect of such changes on the market value of the Company’s investment securities portfolio;

• the credit risk associated with the substantial amount of commercial real estate, construction and land development and commercial and industrial loans in our loan portfolio;

• the extensive federal and state regulation, supervision and examination governing almost every aspect of the Company’s operations including the Dodd-Frank Wall Street Reform and Consumer Protection Act and the rules and regulations issued in accordance with this statute and potential expenses associated with complying with such regulations;

• the Company’s ability to comply with applicable capital and liquidity requirements (including the finalized Basel III capital standards), including our ability to generate liquidity internally or raise capital on favorable terms;

• possible changes in trade, monetary and fiscal policies, laws and regulations and other activities of governments, agencies, and similar organizations;

• conditions in the financial markets that may limit the Company’s access to additional funding to meet its liquidity needs;

• any impairment of the Company’s goodwill or other intangible assets;

• failure of the financial and operational controls of the Company’s Cash Connect^® division;

• the success of the Company’s growth plans, including the successful integration of past and future acquisitions;

• the Company’s ability to fully realize the cost savings and other benefits of its acquisitions, business disruption following those acquisitions, and post-acquisition customer acceptance of the Company’s products and services and related customer disintermediation;

• negative perceptions or publicity with respect to the Company’s trust and wealth management business;

• system failure or cybersecurity breaches of the Company’s network;

• the Company’s ability to recruit and retain key employees;

• the effects of problems encountered by other financial institutions that adversely affect the Company or the banking industry generally;

• the effects of weather and natural disasters such as floods, droughts, wind, tornadoes and hurricanes as well as effects from geopolitical instability and man-made disasters including terrorist attacks;

• possible changes in the speed of loan prepayments by the Company’s customers and loan origination or sales volumes;

• possible changes in the speed of prepayments of mortgage-backed securities due to changes in the interest rate environment, and the related acceleration of premium amortization on prepayments in the event that prepayments accelerate;

3

• regulatory limits on the Company’s ability to receive dividends from its subsidiaries and pay dividends to its shareholders;

• the effects of any reputational, credit, interest rate, market, operational, legal, liquidity, regulatory and compliance risk resulting from developments related to any of the risks discussed above; and

• the effects of other risks and uncertainties, discussed in the Company’s Form 10-K for the year ended December 31, 2016 and other documents filed by the Company with the Securities and Exchange Commission from time to time. 

Forward-looking statements speak only as of the date they are made, and the Company assumes no obligation to revise or update any forward-looking statement, whether written or oral, that may be made from time to time by or on behalf of the Company for any reason, except as required by law.

4

WSFS FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

	Three Months Ended March 31,
	2017		2016
(Dollars in thousands, except per share data)	(Unaudited)
Interest income:
Interest and fees on loans	$	54,681	$	44,562
Interest on mortgage-backed securities	4,395		3,894
Interest and dividends on investment securities:
Taxable	117		77
Tax-exempt	1,132		1,143
Other interest income	501		370
	60,826		50,046
Interest expense:
Interest on deposits	3,075		2,118
Interest on senior debt	2,121		942
Interest on Federal Home Loan Bank advances	1,858		1,048
Interest on federal funds purchased and securities sold under agreements to repurchase	201		182
Interest on trust preferred borrowings	446		371
Interest on other borrowings	22		29
	7,723		4,690
Net interest income	53,103		45,356
Provision for loan losses	2,162		780
Net interest income after provision for loan losses	50,941		44,576
Noninterest income:
Credit/debit card and ATM income	8,131		6,901
Investment management and fiduciary income	8,039		5,254
Deposit service charges	4,397		4,276
Mortgage banking activities, net	1,185		1,654
Securities gains, net	320		305
Loan fee income	549		477
Bank owned life insurance income	275		231
Other income	5,196		4,570
	28,092		23,668
Noninterest expense:
Salaries, benefits and other compensation	28,836		22,876
Occupancy expense	5,162		4,270
Equipment expense	3,124		2,473
Professional fees	1,635		2,403
Data processing and operations expenses	1,618		1,542
Marketing expense	624		664
Loan workout and OREO expenses	521		503
FDIC expenses	529		838
Corporate development expense	338		569
Other operating expense	9,119		7,659
	51,506		43,797
Income before taxes	27,527		24,447
Income tax provision	8,590		8,677
Net income	$	18,937	$	15,770
Earnings per share:
Basic	$	0.60	$	0.53
Diluted	$	0.59	$	0.52

The accompanying notes are an integral part of these unaudited Consolidated Financial Statements.

5

WSFS FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

	Three Months Ended March 31,
	2017			2016
(Dollars in thousands)	(Unaudited)
Net Income	$	18,937		$	15,770
Other comprehensive income:
Net change in unrealized gains on investment securities available for sale
Net unrealized gains arising during the period, net of tax expense of $779 and $6,479, respectively	1,272			10,572
Less: reclassification adjustment for net gains on sales realized in net income, net of tax expense of $114 and $116, respectively	(206		)	(189		)
	1,066			10,383
Net change in securities held to maturity
Amortization of unrealized gain on securities reclassified to held-to-maturity, net of tax expense of $59 and $65, respectively	(101		)	(103		)
Net change in unfunded pension liability
Change in unfunded pension liability related to unrealized (loss) gain, prior service cost and transition obligation, net of tax (benefit) expense of ($12) and $306, respectively	(23		)	478
Net change in cash flow hedge
Net unrealized loss arising during the period, net of tax benefit of ($69) and $0, respectively	(112		)	—
Total other comprehensive income	830			10,758
Total comprehensive income	$	19,767		$	26,528

The accompanying notes are an integral part of these unaudited Consolidated Financial Statements.

6

WSFS FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

	March 31, 2017			December 31, 2016
(Dollars in thousands, except per share and share data)	(Unaudited)
Assets:
Cash and due from banks	$	120,913		$	119,929
Cash in non-owned ATMs	730,747			698,454
Interest-bearing deposits in other banks including collateral of $3,380 at March 31, 2017 and December 31, 2016	3,603			3,540
Total cash and cash equivalents	855,263			821,923
Investment securities, available for sale (amortized cost of $800,612 at March 31, 2017 and $807,761 at December 31, 2016)	789,125			794,543
Investment securities, held to maturity-at cost (fair value of $163,241 at March 31, 2017 and $163,232 at December 31, 2016)	163,611			164,346
Loans, held for sale at fair value	29,394			54,782
Loans, net of allowance for loan losses of $39,826 at March 31, 2017 and $39,751 at December 31, 2016	4,552,151			4,444,375
Bank owned life insurance	101,700			101,425
Stock in Federal Home Loan Bank of Pittsburgh-at cost	20,002			38,248
Other real estate owned	3,582			3,591
Accrued interest receivable	16,712			17,027
Premises and equipment	49,194			48,871
Goodwill	165,960			167,539
Intangible assets	24,412			23,708
Other assets	81,793			84,892
Total assets	$	6,852,899		$	6,765,270
Liabilities and Stockholders’ Equity
Liabilities:
Deposits:
Noninterest-bearing demand	$	1,658,111		$	1,266,306
Interest-bearing demand	932,284			935,333
Money market	1,342,464			1,257,520
Savings	597,186			547,293
Time	321,325			332,624
Jumbo certificates of deposit – customer	248,861			260,560
Total customer deposits	5,100,231			4,599,636
Brokered deposits	276,599			138,802
Total deposits	5,376,830			4,738,438
Federal funds purchased and securities sold under agreements to repurchase	135,000			130,000
Federal Home Loan Bank advances	298,095			854,236
Trust preferred borrowings	67,011			67,011
Senior debt	152,177			152,050
Other borrowed funds	48,566			64,150
Accrued interest payable	2,931			1,151
Other liabilities	68,288			70,898
Total liabilities	6,148,898			6,077,934
Stockholders’ Equity:
Common stock $0.01 par value, 65,000,000 shares authorized; issued 56,125,000 at March 31, 2017 and 55,995,219 at December 31, 2016	581			580
Capital in excess of par value	331,371			329,457
Accumulated other comprehensive loss	(6,787		)	(7,617		)
Retained earnings	643,816			627,078
Treasury stock at cost, 24,667,145 shares at March 31, 2017 and 24,605,145 shares at December 31, 2016	(264,980		)	(262,162		)
Total stockholders’ equity	704,001			687,336
Total liabilities and stockholders’ equity	$	6,852,899		$	6,765,270

The accompanying notes are an integral part of these unaudited Consolidated Financial Statements.

7

WSFS FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

(Unaudited)

(Dollars and share data in thousands)	Shares	Common Stock		Capital in Excess of Par Value		Accumulated Other Comprehensive Income (Loss)			Retained Earnings			Treasury Stock			Total Shareholders' Equity
Balance, December 31, 2015	55,945,245	$	560	$	256,435	$	696		$	570,630		$	(247,850	)	$	580,471
Net Income	—	—		—		—			15,770			—			15,770
Other comprehensive income	—	—		—		10,758			—			—			10,758
Cash dividend, $0.06 per share	—	—		—		—			(1,783		)	—			(1,783		)
Issuance of common stock including proceeds from exercise of common stock options	61,498	1		659		—			—			—			660
Stock-based compensation expense	—	—		699		—			—			—			699
Repurchase of common stock, 301,871 shares	—	—		—		—			—			(8,995		)	(8,995		)
Balance, March 31, 2016	56,006,743	$	561	$	257,793	$	11,454		$	584,617		$	(256,845	)	$	597,580
Balance, December 31, 2016	55,995,219	$	580	$	329,457	$	(7,617	)	$	627,078		$	(262,162	)	$	687,336
Net Income	—	—		—		—			18,937			—			18,937
Other comprehensive income	—	—		—		830			—			—			830
Cash dividend, $0.07 per share	—	—		—		—			(2,199		)	—			(2,199		)
Issuance of common stock including proceeds from exercise of common stock options	129,781	1		1,093		—			—			—			1,094
Stock-based compensation expense	—	—		821		—			—			—			821
Repurchase of common stock, 62,000 shares	—	—		—		—			—			(2,818		)	(2,818		)
Balance, March 31, 2017	56,125,000	$	581	$	331,371	$	(6,787	)	$	643,816		$	(264,980	)	$	704,001

The accompanying notes are an integral part of these unaudited Consolidated Financial Statements.

8

WSFS FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Three months ended March 31,
	2017			2016
(Dollars in thousands)	(Unaudited)
Operating activities:
Net Income	$	18,937		$	15,770
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan losses	2,162			780
Depreciation of premises and equipment, net	2,190			1,903
Amortization of fees and discounts, net	4,742			3,895
Amortization of intangible assets	857			549
Decrease in accrued interest receivable	315			48
Increase in other assets	(1,838		)	(3,534		)
Origination of loans held for sale	(85,833		)	(72,474		)
Proceeds from sales of loans held for sale	105,436			77,834
Gain on mortgage banking activities, net	(1,185		)	(1,654		)
Gain on sale of securities, net	(320		)	(305		)
Stock-based compensation expense	821			758
Increase in accrued interest payable	1,780			539
Decrease in other liabilities	(1,537		)	(7,930		)
Loss on sale of other real estate owned and valuation adjustments, net	39			76
Deferred income tax expense	3,190			3,293
Increase in value of bank owned life insurance	(275		)	(231		)
Increase in capitalized interest, net	(1,316		)	(1,193		)
Net cash provided by operating activities	$	48,165		$	18,124
Investing activities:
Purchases of investment securities held to maturity	—			(3,329		)
Repayments of investment securities held to maturity	250			1,335
Maturities and calls of investment securities held to maturity	—			400
Sale of investment securities available for sale	263,015			38,932
Purchases of investment securities available for sale	(375,687		)	(91,963		)
Repayments of investment securities available for sale	119,313			15,463
Net increase in loans	(106,933		)	(30,010		)
Purchases of stock of Federal Home Loan Bank of Pittsburgh	(54,990		)	(20,037		)
Redemptions of stock of Federal Home Loan Bank of Pittsburgh	73,236			19,845
Sales of other real estate owned	1,707			1,442
Investment in premises and equipment	(2,480		)	(1,234		)
Net cash used for investing activities	$	(82,569	)	$	(69,156	)

9

	Three months ended March 31,
	2017			2016
(Dollars in thousands)	(Unaudited)
Financing activities:
Net increase in demand and saving deposits	508,429			35,907
Decrease in time deposits	(22,998		)	(26,072		)
Increase in brokered deposits	137,797			43,353
Decrease in loan payable	(420		)	(407		)
Receipts from FHLB advances	42,415,835			28,349,212
Repayments of FHLB advances	(42,971,976		)	(28,310,900		)
Receipts from federal funds purchased and securities sold under agreement to repurchase	6,688,000			8,710,770
Repayments of federal funds purchased and securities sold under agreement to repurchase	(6,683,000		)	(8,711,445		)
Dividends paid	(2,199		)	(1,783		)
Issuance of common stock and exercise of common stock options	1,094			241
Purchase of treasury stock	(2,818		)	(8,995		)
Net cash provided by financing activities	$	67,744		$	79,881
Increase in cash and cash equivalents	33,340			28,849
Cash and cash equivalents at beginning of period	821,923			561,179
Cash and cash equivalents at end of period	$	855,263		$	590,028
Supplemental Disclosure of Cash Flow Information:
Cash paid for interest during the period	$	5,943		$	4,151
Cash (received) paid for income taxes, net	(1,199		)	9,554
Loans transferred to other real estate owned	1,737			417
Loans transferred to portfolio from held-for-sale at fair value	6,470			1,510
Net change in accumulated other comprehensive income	830			10,758
Non-cash goodwill adjustments, net	(1,579		)	(358		)

The accompanying notes are an integral part of these unaudited Consolidated Financial Statements.

10

WSFS FINANCIAL CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2017

(UNAUDITED)

1. BASIS OF PRESENTATION

General

Our unaudited Consolidated Financial Statements include the accounts of WSFS Financial Corporation (the Company, our Company, we, our or us), Wilmington Savings Fund Society, FSB (WSFS Bank or the Bank), WSFS Wealth Management, LLC (Powdermill), WSFS Capital Management, LLC (West Capital) and Cypress Capital Management, LLC (Cypress). We also have one unconsolidated subsidiary, WSFS Capital Trust III (the Capital Trust). WSFS Bank has three wholly-owned subsidiaries: WSFS Wealth Investments, 1832 Holdings, Inc. and Monarch Entity Services LLC (Monarch).

Overview

Founded in 1832, the Bank is one of the ten oldest bank and trust companies continuously operating under the same name in the United States (U.S.). We provide residential and commercial real estate, commercial and consumer lending services, as well as retail deposit and cash management services. Lending activities are funded primarily with customer deposits and borrowings. In addition, we offer a variety of wealth management and trust services to personal and corporate customers. The Federal Deposit Insurance Corporation (FDIC) insures our customers’ deposits to their legal maximums. We serve our customers primarily from our 77 offices located in Delaware (46), Pennsylvania (29), Virginia (1) and Nevada (1) and through our website at www.wsfsbank.com. Information on our website is not incorporated by reference into this quarterly report.

In preparing the unaudited Consolidated Financial Statements, we are required to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses. Amounts subject to significant estimates include the allowance for loan losses and reserves for lending related commitments, goodwill, intangible assets, post-retirement benefit obligations, the fair value of financial instruments, other-than-temporary impairment (OTTI), and the income tax valuation allowance. Among other effects, changes to these estimates could result in future impairments of investment securities, goodwill and intangible assets and establishment of the allowance and lending related commitments as well as increased post-retirement benefits expense.

Our accounting and reporting policies conform to Generally Accepted Accounting Principles (GAAP) in the U.S., prevailing practices within the banking industry for interim financial information and Rule 10-01 of SEC Regulation S-X (Rule 10-01). Rule 10-01 does not require us to include all information and notes that would be required in audited financial statements. Operating results for the periods presented are not necessarily indicative of the results that may be expected for any future quarters or for the year ending December 31, 2017. These unaudited, interim Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and related notes included in our 2016 Annual Report on Form 10-K that was filed with the SEC on March 1, 2017 and is available at www.sec.gov or on our website at http://investors.wsfsbank.com/financials.cfm. Whenever necessary, reclassifications have been made to the prior period Consolidated Financial Statements to conform to the current period’s presentation. All significant intercompany transactions were eliminated in consolidation.

The significant accounting policies used in preparation of our Consolidated Financial Statements are disclosed in our 2016 Annual Report on Form 10-K. There have not been any material changes in our significant accounting policies from those disclosed in our 2016 Annual Report on Form 10-K.

Senior Debt

On June 13, 2016, the Company issued $100.0 million of senior unsecured fixed-to-floating rate notes. The senior unsecured notes mature on June 15, 2026 and have a fixed coupon rate of 4.50% from issuance until June 15, 2021 and a variable coupon rate of three month LIBOR plus 3.30% from June 15, 2021 until maturity. The senior unsecured notes may be redeemed beginning on June 15, 2021 at 100% of principal plus accrued and unpaid interest. The net proceeds from the issuance of the notes are being used for general corporate purposes.

11

In 2012, we issued and sold $55.0 million in aggregate principal amount of 6.25% senior notes due 2019 (the “2012 senior debt”). The 2012 senior debt is unsecured and ranks equally with all of our other present and future unsecured unsubordinated obligations. The 2012 senior debt is effectively subordinated to our secured indebtedness and structurally subordinated to the indebtedness of our subsidiaries. At our option, the 2012 senior debt is callable, in whole or in part, on September 1, 2017, or on any scheduled interest payment date thereafter, at a price equal to the outstanding principal amount to be redeemed plus accrued and unpaid interest. The 2012 senior debt matures on September 1, 2019.

Acquisitions in 2016

On August 12, 2016, we completed the acquisition of Penn Liberty Financial Corp. (Penn Liberty), a community bank headquartered in Wayne, Pennsylvania. We expect this acquisition to build our market share, deepen our presence in the southeastern Pennsylvania market, and enhance our customer base. The results of Penn Liberty’s operations are included in our Consolidated Financial Statements since the date of the acquisition. See Note 2 – Business Combinations for further information.

During the third and fourth quarters of 2016, respectively, we acquired the assets of Powdermill Financial Solutions LLC, a multi-family office serving an affluent clientele in the local community and throughout the U.S., and West Capital Management, Inc., an independent, fee-only wealth management firm providing fully customized solutions tailored to the unique needs of institutions and high net worth individuals which operates under a multi-family office philosophy. These acquisitions align with our strategic plan to expand our wealth management offerings and to diversify our fee-income generating businesses.

Correction of Prior Period Balances

The Consolidated Statements of Income for the quarter ended March 31, 2016 has been revised to correct an immaterial error in Noninterest income - Other revenue and Noninterest expense - Other operating expense related to revenue earned for cash servicing fees. As a result, the Consolidated Statement of Income has been revised to reflect these changes, as follows:

	Three months ended March 31, 2016
	As originally reported		Adjustments		As revised
Noninterest income - Other revenue	$	3,972	$	598	$	4,570
Noninterest expense - Other operating expense	7,061		598		7,659

The above revision had no effect on earnings per share or retained earnings. Periods not presented herein will be revised, as applicable, as they are included in future filings.

RECENT ACCOUNTING PRONOUNCEMENTS

Accounting Guidance Adopted in 2017

In March 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-05: Derivatives and Hedging (Topic 815): Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships, which amends Accounting Standards Codification (ASC) Topic 815: Derivatives and Hedging. This new guidance clarifies that the novation of a derivative contract (i.e., a change in the counterparty) in a hedge accounting relationship does not, in and of itself, cause a hedge accounting relationship to be discontinued because it does not represent a termination of the original derivative instrument or a change in the critical terms of the hedge relationship. This new guidance is effective for annual reporting periods beginning after December 15, 2016 and may be adopted prospectively or retroactively. Early adoption is permitted, including adoption in an interim period. The Company adopted this accounting guidance during the quarter ended March 31, 2017 with no impact to our Consolidated Financial statements, as the standard is applied on a prospective basis.

12

In March 2016, the FASB issued ASU No. 2016-06, Contingent Put and Call Options in Debt Instruments, Derivatives and Hedging (Topic 815). ASU 2016-06 clarifies that determining whether the economic characteristics of a put or call are clearly and closely related to its debt host requires only an assessment of the four-step decision sequence outlined in FASB ASC paragraph 815-15-25-24. Additionally, entities are not required to separately assess whether the contingency itself is clearly and closely related. The standard is effective for public business entities in interim and annual periods in fiscal years beginning after December 15, 2016. Early adoption is permitted in any interim period for which the entity’s financial statements have not been issued, but would be retroactively applied to the beginning of the year that includes the interim period. The standard requires a modified retrospective transition approach, with a cumulative catch-up adjustment to opening retained earnings in the period of adoption. For instruments that are eligible for the fair value option, an entity has a one-time option to irrevocably elect to measure the debt instrument affected by the standard in its entirety at fair value with changes in fair value recognized in earnings. The Company adopted this accounting guidance during the quarter ended March 31, 2017 with no impact on our Consolidated Statements of Income or Consolidated Statements of Financial Condition.

In March 2016, the FASB issued ASU No. 2016-07, Simplifying the Transition to the Equity Method of Accounting, Investments - Equity Method and Joint Ventures (Topic 323). ASU 2016-07 eliminates the requirement for an investor to retroactively apply the equity method when its increase in ownership interest (or degree of influence) in an investee triggers equity method accounting. The standard is effective for all entities in annual and interim periods in fiscal years beginning after December 15, 2016. Early adoption is permitted. The new guidance will be applied prospectively to changes in ownership (or influence) after the adoption date. The Company adopted this accounting guidance during the quarter ended March 31, 2017 with no impact to our Consolidated Financial statements, as the standard is applied on a prospective basis.

Accounting Guidance Pending Adoption at March 31, 2017

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606). This ASU supersedes the revenue recognition requirements in ASC 605, Revenue Recognition. ASU No. 2014-09 will require an entity to recognize revenue when it transfers promised goods or services to customers using a five-step model that requires entities to exercise judgment when considering the terms of the contracts. In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date. This amendment defers the effective date of ASU 2014-09 by one year. In March 2016, the FASB issued ASU 2016- 08, Principal versus Agent Considerations (Reporting Gross versus Net), which amends the principal versus agent guidance and clarifies that the analysis must focus on whether the entity has control of the goods or services before they are transferred to the customer. In addition, the FASB issued ASU Nos. 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers and 2016-12, Narrow-Scope Improvements and Practical Expedients, both of which provide additional clarification of certain provisions in Topic 606. These Accounting Standards Codification (“ASC”) updates are effective for public business entities in annual and interim reporting periods in fiscal years beginning after December 15, 2017. Early application is permitted for all entities, but not before annual reporting periods beginning after December 15, 2016. The standard permits the use of either the retrospective or retrospectively with the cumulative effect transition method. The Company is currently in the process of evaluating all revenue streams, accounting policies, practices and reporting to identify and understand any impact on the Company’s Consolidated Financial Statements. Our preliminary evaluation suggests that adoption of this guidance is not expected to have a material effect on our Consolidated Financial Statements. The Company anticipates completing our assessment in the second half of 2017.

In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments - Overall (Subtopic 825-10), Recognition and Measurement of Financial Assets and Financial Liabilities. This amendment requires that equity investments be measured at fair value with changes in fair value recognized in net income. When fair value is not readily determinable an entity may elect to measure the equity investment at cost, minus impairment, plus or minus any change in the investment’s observable price. For financial liabilities that are measured at fair value, the amendment requires an entity to present separately, in other comprehensive income, any change in fair value resulting from a change in instrument specific credit risk. ASU 2016-01 is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early adoption is permitted. Entities may apply this guidance on a prospective or retrospective basis. The Company does not expect the application of this guidance to have a material impact on its Consolidated Financial Statements.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). This ASU revises the accounting related to lessee accounting. Under the new guidance, lessees will be required to recognize a lease liability and a right-of-use asset for all leases. The new lease guidance also simplifies the accounting for sale and leaseback transactions primarily because lessees must recognize lease assets and lease liabilities. ASU 2016-02 is effective for the first interim period within annual periods beginning after December 15, 2018, with early adoption permitted. Adoption using the modified retrospective transition approach is required for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The Company is currently evaluating the impact of adopting ASU 2016-02 on its Consolidated Financial Statements.

13

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326). ASU 2016-13 replaces the incurred loss impairment methodology in current GAAP with an expected credit loss methodology and requires consideration of a broader range of information to determine credit loss estimates. Financial assets measured at amortized cost will be presented at the net amount expected to be collected by using an allowance for credit losses. Purchased credit impaired loans will receive an allowance account at the acquisition date that represents a component of the purchase price allocation. Credit losses relating to available-for-sale debt securities will be recorded through an allowance for credit losses, with such allowance limited to the amount by which fair value is below amortized cost. This guidance is effective for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years. The Company is currently evaluating the impact of this guidance on its Consolidated Financial Statements.

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 represents the Emerging Issues Task Force’s (“the EITF”) final consensus on eight issues related to the classification of cash payments and receipts in the statement of cash flows for a number of common transactions. The consensus also clarifies when identifiable cash flows should be separated versus classified based on their predominant source or use. This guidance is effective for fiscal years beginning after December 15, 2017 and interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. The Company is currently evaluating the impact of this guidance on its Consolidated Financial Statements.

In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. ASU 2017-01 provides a new, two-step framework for determining whether a transaction is accounted for as an acquisition (or disposal) of assets or a business. The first step is evaluating whether substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets; if so, the transaction is not considered a business. Also, in order to be considered a business, the transaction would need to include an input and a substantive process that together significantly contribute to the ability to create outputs. The guidance is effective for public entities in annual and interim periods in fiscal years beginning after December 15, 2017. Early adoption is permitted for transactions that have not been reported in financial statements that have been issued or been made available for issuance. The Company does not expect the application of this guidance to have a material impact on its Consolidated Financial Statements.

In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. ASU 2017-04 simplifies the measurement of goodwill impairment by removing the hypothetical purchase price allocation (“Step 2”). The new guidance requires an impairment of goodwill be measured as the amount by which a reporting unit’s carrying value exceeds its fair value, up to the amount of goodwill recorded. The guidance is effective for public entities in annual and interim periods in fiscal years beginning after December 15, 2019. Early adoption is permitted for goodwill impairment tests with measurement dates after January 1, 2017. The Company does not expect the application of this guidance to have a material impact on its Consolidated Financial Statements.

In February 2017, the FASB issued ASU No. 2017-05, Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets. ASU 2017-05 provides clarification of the scope of ASC 610-20. Specifically, the new guidance clarifies that ASC 610-20 applies to nonfinancial assets which do not meet the definition of a business or not-for-profit activity. Further, the new guidance clarifies that a financial asset is within the scope of ASC 610-20 if it meets the definition of an in-substance nonfinancial asset which is defined as a financial asset promised to a counterparty in a contract where substantially all of the assets promised are nonfinancial. Finally, the new guidance clarifies that each distinct nonfinancial asset and in-substance nonfinancial asset should be derecognized when the counterparty obtains control of it. The guidance is effective for public entities in annual and interim reporting periods in fiscal years beginning after December 15, 2017. Early application is permitted for all entities, but not before annual reporting periods beginning after December 15, 2016. The Company is currently evaluating the impact of adopting ASU 2017-05 on its Consolidated Financial Statements.

In March 2017, the FASB issued ASU No. 2017-07, Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The new guidance requires that the service cost component of net periodic pension cost be disclosed with other compensation costs in the income statement. For all other cost components, an entity must either separately disclose the other cost components in separate line item(s) outside a subtotal of income from operations in the income statement or disclose the line item(s) used to present the other cost components in the income statement. The guidance is effective for public entities in annual and interim periods in fiscal years beginning after December 15, 2017. Early adoption is permitted. The Company does not expect the application of this guidance to have a material impact on its Consolidated Financial Statements.

14

In March 2017, the FASB issued ASU No. 2017-08, Premium Amortization on Purchased Callable Debt Securities. The new guidance requires the amortization period for certain non-contingent callable debt securities held at a premium to end at the earliest call date of the debt security. If the call option is not exercised at the earliest call date, the guidance requires the debt security's effective yield to be reset based on the contractual payment terms of the debt security. The guidance is effective for public entities in annual and interim periods in fiscal years beginning after December 15, 2018. Early adoption is permitted. Use of the modified retrospective method, with a cumulative-effect adjustment to retained earnings, is required. In the period of adoption, a change in accounting principle disclosure is required. The Company does not expect the application of this guidance to have a material impact on its Consolidated Financial Statements.

2. BUSINESS COMBINATIONS

Penn Liberty Financial Corporation

On August 12, 2016, we completed the acquisition of Penn Liberty. The acquisition of Penn Liberty was accounted for as a business combination using the acquisition method of accounting and, accordingly, assets acquired, liabilities assumed and consideration transferred were recorded at their estimated fair values as of the acquisition date. The fair values are preliminary estimates and are subject to adjustment during the one-year measurement period after the acquisition.

In connection with the merger, the consideration transferred and the fair value of identifiable assets acquired and liabilities assumed, including remeasurement adjustments subsequent to the date of acquisition, are summarized in the following table:

(Dollars in thousands)	Fair Value
Consideration Transferred:
Common shares issued (1,806,748)	$	68,352
Cash paid to Penn Liberty stock and option holders	40,549
Value of consideration	108,901
Assets acquired:
Cash and due from banks	102,301
Investment securities	627
Loans	483,482
Premises and equipment	6,817
Deferred income taxes	6,542
Bank owned life insurance	8,666
Core deposit intangible	2,882
Other real estate owned	996
Other assets	12,092
Total assets	624,405
Liabilities assumed:
Deposits	568,706
Other borrowings	10,000
Other liabilities	3,977
Total liabilities	582,683
Net assets acquired:	41,722
Goodwill resulting from acquisition of Penn Liberty	$	67,179

15

The following table details the change to goodwill recorded subsequent to acquisition:

(Dollars in thousands)	Fair Value
Goodwill resulting from the acquisition of Penn Liberty reported as of December 31, 2016	$	68,814
Effects of adjustments to:
Deferred income taxes	880
Other assets	(1,447		)
Other liabilities	(1,068		)
Adjusted goodwill resulting from the acquisition of Penn Liberty as of March 31, 2017	$	67,179

In many cases, the fair values of assets acquired and liabilities assumed were determined by estimating the cash flows expected to result from those assets and liabilities and discounting them at appropriate market rates.

3. EARNINGS PER SHARE

The following table shows the computation of basic and diluted earnings per share:

	Three Months Ended March 31,
(Dollars and Shares in thousands, except per share data)	2017		2016
Numerator:
Net income	$	18,937	$	15,770
Denominator:
Weighted average basic shares	31,407		29,671
Dilutive potential common shares	942		558
Weighted average fully diluted shares	32,349		30,229
Earnings per share:
Basic	$	0.60	$	0.53
Diluted	$	0.59	$	0.52
Outstanding common stock equivalents having no dilutive effect	22		42

16

4. INVESTMENT SECURITIES

The following tables detail the amortized cost and the estimated fair value of our available-for-sale and held-to-maturity investment securities. None of our investment securities are classified as trading.

(Dollars in thousands)	Amortized Cost		Gross Unrealized  Gain		Gross Unrealized  Loss		Fair Value
Available-for-Sale Securities:
March 31, 2017
GSE	$	33,051	$	2	$	72	$	32,981
CMO	280,576		699		3,564		277,711
FNMA MBS	393,356		984		8,289		386,051
FHLMC MBS	65,228		204		1,261		64,171
GNMA MBS	27,767		275		445		27,597
Other investments	634		—		20		614
	$	800,612	$	2,164	$	13,651	$	789,125
December 31, 2016
GSE	$	35,061	$	9	$	60	$	35,010
CMO	264,607		566		3,957		261,216
FNMA MBS	414,218		950		9,404		405,764
FHLMC MBS	64,709		135		1,330		63,514
GNMA MBS	28,540		303		427		28,416
Other investments	626		—		3		623
	$	807,761	$	1,963	$	15,181	$	794,543

(Dollars in thousands)	Amortized Cost		Gross Unrealized  Gain		Gross Unrealized  Loss		Fair Value
Held-to-Maturity Securities(1)
March 31, 2017
State and political subdivisions	$	163,611	$	646	$	1,016	$	163,241
December 31, 2016
State and political subdivisions	$	164,346	$	271	$	1,385	$	163,232

⁽¹⁾  Held-to–maturity securities transferred from available-for-sale are included in held-to-maturity at fair value at the time of transfer. The amortized cost of held-to-maturity securities included net unrealized gains of $2.1 million and $2.2 million at March 31, 2017 and December 31, 2016, respectively, related to securities transferred, which are offset in Accumulated Other Comprehensive Income, net of tax.

17

The scheduled maturities of investment securities available for sale and held to maturity at March 31, 2017 and December 31, 2016 are presented in the table below:

	Available for Sale (1) (2)
	Amortized		Fair
(Dollars in thousands)	Cost		Value
March 31, 2017
Within one year	$	20,012	$	19,997
After one year but within five years	18,059		17,981
After five years but within ten years	210,595		205,242
After ten years	551,312		545,291
	$	799,978	$	788,511
December 31, 2016
Within one year	$	16,009	$	16,017
After one year but within five years	19,052		18,992
After five years but within ten years	276,635		270,300
After ten years	495,439		488,611
	$	807,135	$	793,920
	Held to Maturity (2)
	Amortized		Fair
(Dollars in thousands)	Cost		Value
March 31, 2017
Within one year	$	—	$	—
After one year but within five years	5,940		5,975
After five years but within ten years	10,482		10,511
After ten years	147,189		146,755
	$	163,611	$	163,241
December 31, 2016
Within one year	$	—	$	—
After one year but within five years	6,168		6,162
After five years but within ten years	8,882		8,870
After ten years	149,296		148,200
	$	164,346	$	163,232

 ⁽¹⁾ Included in the investment portfolio, but not in the table above, is a mutual fund with an amortized cost and fair value of $0.6 million as of March 31, 2017 and December 31, 2016 which has no stated maturity.

⁽²⁾  Actual maturities could differ

Mortgage-backed securities (MBS) have expected maturities that differ from their contractual maturities. These differences arise because borrowers have the right to call or prepay obligations with or without a prepayment penalty.

Investment securities with fair market values aggregating $615.8 million and $562.5 million were pledged as collateral for retail customer repurchase agreements, municipal deposits, and other obligations as of March 31, 2017 and December 31, 2016, respectively.

During the first three months of 2017, we sold $263.0 million of investment securities categorized as available for sale, resulting in realized gains of $0.3 million and one security with an immaterial realized loss. During the first three months of 2016, we sold $38.9 million of investment securities categorized as available for sale, resulting in realized gains of $0.3 million and no realized losses. The cost basis of all investment securities sales is based on the specific identification method.

As of March 31, 2017 and December 31, 2016, our investment securities portfolio had remaining unamortized premiums of $16.3 million and $18.0 million, respectively, and unaccreted discounts of $0.6 million and $0.4 million, respectively.

18

For investment securities with unrealized losses, the table below shows our gross unrealized losses and fair value by investment category and length of time that individual securities were in a continuous unrealized loss position at March 31, 2017.

	Duration of Unrealized Loss Position
	Less than 12 months				12 months or longer				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(Dollars in thousands)	Value		Loss		Value		Loss		Value		Loss
Available-for-sale securities:
GSE	$	25,981	$	72	$	—	$	—	$	25,981	$	72
CMO	161,225		3,469		4,239		95		165,464		3,564
FNMA MBS	276,175		8,289		—		—		276,175		8,289
FHLMC MBS	41,765		1,261		—		—		41,765		1,261
GNMA MBS	16,236		445		—		—		16,236		445
Other investments	634		20		—		—		634		20
Total temporarily impaired investments	522,016		13,556		4,239		95		526,255		13,651
	Less than 12 months				12 months or longer				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(Dollars in thousands)	Value		Loss		Value		Loss		Value		Loss
Held-to-maturity securities:
State and political subdivisions	$	84,121	$	969	$	1,960	$	47	$	86,081	$	1,016
Total temporarily impaired investments	$	84,121	$	969	$	1,960	$	47	$	86,081	$	1,016

For investment securities with unrealized losses, the table below shows our gross unrealized losses and fair value by investment category and length of time that individual securities were in a continuous unrealized loss position at December 31, 2016.

	Duration of Unrealized Loss Position
	Less than 12 months				12 months or longer				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(Dollars in thousands)	Value		Loss		Value		Loss		Value		Loss
Available-for-sale securities:
GSE	$	21,996	$	60	$	—	$	—	$	21,996	$	60
CMO	160,572		3,867		4,654		90		165,226		3,957
FNMA MBS	50,878		1,330		—		—		50,878		1,330
FHLMC MBS	300,403		9,404		—		—		300,403		9,404
GNMA MBS	16,480		427		—		—		16,480		427
Other investments	623		3		—		—		623		3
Total temporarily impaired investments	$	550,952	$	15,091	$	4,654	$	90	$	555,606	$	15,181
	Less than 12 months				12 months or longer				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(Dollars in thousands)	Value		Loss		Value		Loss		Value		Loss
Held-to-maturity securities:
State and political subdivisions	$	112,642	$	1,374	$	695	$	11	$	113,337	$	1,385
Total temporarily impaired investments	$	112,642	$	1,374	$	695	$	11	$	113,337	$	1,385

19

At March 31, 2017, we owned investment securities totaling $612.3 million for which the amortized cost basis exceeded fair value. Total unrealized losses on these securities were $14.7 million at March 31, 2017. The temporary impairment is the result of changes in market interest rates subsequent to the purchase of the securities. Our investment portfolio is reviewed each quarter for indications of OTTI. This review includes analyzing the length of time and the extent to which the fair value has been lower than the amortized cost, the financial condition and near-term prospects of the issuer, including any specific events which may influence the operations of the issuer and our intent and ability to hold the investment for a period of time sufficient to allow for full recovery of the unrealized loss. We evaluate our intent and ability to hold securities based upon our investment strategy for the particular type of security and our cash flow needs, liquidity position, capital adequacy and interest rate risk position. We do not have the intent to sell, nor is it more likely-than-not we will be required to sell these securities before we are able to recover the amortized cost basis.

All securities, with the exception of one having a fair value of $1.0 million at March 31, 2017, were AA-rated or better at the time of purchase and remained investment grade at March 31, 2017. All securities were evaluated for OTTI at March 31, 2017 and December 31, 2016. The result of this evaluation showed no OTTI as of March 31, 2017 or December 31, 2016. The estimated weighted average duration of MBS was 5.34 years at March 31, 2017.

20

5. LOANS

The following table shows our loan portfolio by category:

(Dollars in thousands)	March 31, 2017		December 31, 2016
Commercial and industrial	$	1,339,867	$	1,287,731
Owner-occupied commercial	1,092,292		1,078,162
Commercial mortgages	1,165,556		1,163,554
Construction	255,760		222,712
Residential (1)	281,760		289,611
Consumer	464,898		450,029
	4,600,133		4,491,799
Less:
Deferred fees, net	8,156		7,673
Allowance for loan losses	39,826		39,751
Net loans	$	4,552,151	$	4,444,375

⁽¹⁾ Includes Reverse Mortgages, at fair value of $22.5 million at March 31, 2017 and $22.6 million at December 31, 2016.

The following table shows the outstanding principal balance and carrying amounts for acquired credit impaired loans for which the Company applies ASC 310-30 as of the dates indicated:

(Dollars in thousands)	March 31, 2017		December 31, 2016
Outstanding principal balance	$	38,418	$	41,574
Carrying amount	30,783		33,104
Allowance for loan losses	464		510

The following table presents the changes in accretable yield on the acquired credit impaired loans for the three months endedMarch 31, 2017:

(Dollars in thousands)	Three months ended March 31, 2017
Balance at beginning of period	$	5,150
Accretion	(792		)
Reclassification from nonaccretable difference	(144		)
Additions/adjustments	(112		)
Disposals	—
	$	4,102

21

6. ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY INFORMATION

Allowance for Loan Losses

We maintain an allowance for loan losses which represents our best estimate of probable losses within our loan portfolio. As losses are realized, they are charged to this allowance. We established our allowance in accordance with guidance provided in the SEC’s Staff Accounting Bulletin 102 (SAB 102), Selected Loan Loss Allowance Methodology and Documentation Issues, Accounting Standard Codification ("ASC") Contingencies (ASC 450) and Receivables (ASC 310). When we have reason to believe it is probable that we will not be able to collect all contractually due amounts of principal and interest, loans are evaluated for impairment on an individual basis and a specific allocation of the allowance is assigned in accordance with ASC 310-10. We also maintain an allowance for loan losses on acquired loans when: (i) for loans accounted for under ASC 310-30, there is deterioration in credit quality subsequent to acquisition and (ii) for loans accounted for under ASC 310-20, the inherent losses in the loans exceed the remaining credit discount recorded at the time of acquisition. The determination of the allowance for loan losses requires significant judgment reflecting our best estimate of impairment related to specifically identified impaired loans as well as probable loan losses in the remaining loan portfolio. Our evaluation is based on a continuing review of these portfolios. The following are included in our allowance for loan losses:

• Specific reserves for impaired loans

• An allowance for each pool of homogenous loans based on historical loss experience

• Adjustments for qualitative and environmental factors allocated to pools of homogenous loans

When it is probable that the Bank will be unable to collect all amounts due (interest and principal) in accordance with the contractual terms of the loan agreement, it assigns a specific reserve to that loan, if necessary. Unless loans are well-secured and collection is imminent, loans greater than 90 days past due are deemed impaired and their respective reserves are generally charged-off once the loss has been confirmed. Estimated specific reserves are based on collateral values, estimates of future cash flows or market valuations. We charge loans off when they are deemed to be uncollectible. During the three months endedMarch 31, 2017 and 2016, net charge-offs totaled $2.1 million or 0.19% of average loans annualized, and $0.3 million, or 0.03% of average loans annualized, respectively.

Allowances for pooled homogeneous loans, that are not deemed impaired, are based on historical net loss experience. Estimated losses for pooled portfolios are determined differently for commercial loan pools and retail loan pools. Commercial loans are pooled as follows: commercial, owner-occupied commercial, commercial mortgages and construction. Each pool is further segmented by internally assessed risk ratings. Loan losses for commercial loans are estimated by determining the probability of default and expected loss severity upon default. Probability of default is calculated based on the historical rate of migration to impaired status during the last 25 quarters. During the three months ended March 31, 2017, we increased the look-back period to 25 quarters from the 24 quarters used at December 31, 2016. This increase in the look-back period allows us to continue to anchor to the fourth quarter of 2010 to ensure that the core reserves calculated by the ALLL model are adequately considering the losses within a full credit cycle.

Loss severity upon default is calculated as the actual loan losses (net of recoveries) on impaired loans in their respective pool during the same time frame. Retail loans are pooled into the following segments: residential mortgage, consumer secured and consumer unsecured loans. Pooled reserves for retail loans are calculated based solely on average net loss rates over the same 25 quarter look-back period.

Qualitative adjustment factors consider various current internal and external conditions which are allocated among loan types and take into consideration:

• Current underwriting policies, staff, and portfolio mix,

• Internal trends of delinquency, nonaccrual and criticized loans by segment,

• Risk rating accuracy, control and regulatory assessments/environment,

• General economic conditions - locally and nationally,

• Market trends impacting collateral values,

• The competitive environment, as it could impact loan structure and underwriting, and

• Valuation complexity by segment.

The above factors are based on their relative standing compared to the period in which historic losses are used in core reserve estimates and current directional trends. Qualitative factors in our model can add to or subtract from core reserves.

22

The allowance methodology uses a loss emergence period (LEP), which is the period of time between an event that triggers the probability of a loss and the confirmation of the loss. We estimate the commercial LEP to be approximately 8 quarters as of March 31, 2017. Our residential mortgage and consumer LEP remained at 4 quarters as of March 31, 2017. We evaluate LEP quarterly for reasonableness and complete a detailed historical analysis of our LEP annually for our commercial portfolio and review the current 4 quarter LEP for the retail portfolio to determine the continued reasonableness of this assumption.

In prior periods, we had a component of the allowance for model estimation and complexity risk reserve. During the second quarter of 2016 as a result of continued improvement in the model and normal review of the factors, we removed the model estimation and complexity risk reserve from our calculation of the allowance of loan losses.

Our loan officers and risk managers meet at least quarterly to discuss and review the conditions and risks associated with individual problem loans. In addition, various regulatory agencies periodically review our loan ratings and allowance for loan losses and the Bank’s internal loan review department performs loan reviews.

The following tables provide the activity of our allowance for loan losses and loan balances for the three months endedMarch 31, 2017:

	Three months ended March 31, 2017
(Dollars in thousands)	Commercial			Owner-occupied Commercial			Commercial Mortgages			Construction			Residential(1)			Consumer			Total
Allowance for loan losses
Beginning balance	$	13,339		$	6,588		$	8,915		$	2,838		$	2,059		$	6,012		$	39,751
Charge-offs	(1,255		)	(192		)	(104		)	(14		)	(11		)	(1,143		)	(2,719		)
Recoveries	84			75			46			2			120			305			632
Provision (credit)	1,949			(441		)	(518		)	158			(114		)	1,080			2,114
Provision for acquired loans	88			—			(4		)	(23		)	—			(13		)	48
Ending balance	$	14,205		$	6,030		$	8,335		$	2,961		$	2,054		$	6,241		$	39,826
Period-end allowance allocated to:
Loans individually evaluated for impairment	$	1,860		$	—		$	1,395		$	500		$	887		$	194		$	4,836
Loans collectively evaluated for impairment	12,165			6,015			6,763			2,397			1,144			6,042			34,526
Acquired loans evaluated for impairment	180			15			177			64			23			5			464
Ending balance	$	14,205		$	6,030		$	8,335		$	2,961		$	2,054		$	6,241		$	39,826
Period-end loan balances evaluated for:
Loans individually evaluated for impairment (2)	$	16,767		$	4,020		$	9,771		$	3,130		$	14,280		$	9,029		$	56,997
Loans collectively evaluated for impairment	1,175,911			919,508			928,925			225,718			158,430			405,285			3,813,777
Acquired nonimpaired loans	141,933			156,724			216,410			24,540			85,679			50,321			675,607
Acquired impaired loans	5,256			12,040			10,450			2,372			866			263			31,247
Ending balance (3)	$	1,339,867		$	1,092,292		$	1,165,556		$	255,760		$	259,255		$	464,898		$	4,577,628

⁽¹⁾  Period-end loan balance excludes Reverse Mortgages, at fair value of $22.5 million.

⁽²⁾  The difference between this amount and nonaccruing loans represents accruing troubled debt restructured loans of $17.3 million for the period ending March 31, 2017. Accruing troubled debt restructured loans are considered impaired loans.

⁽³⁾  Ending loan balances do not include net deferred fees.

23

The following table provides the activity of the allowance for loan losses and loan balances for the three months ended March 31, 2016:

	Three months ended March 31, 2016
(Dollars in thousands)	Commercial			Owner - occupied Commercial			Commercial Mortgages			Construction			Residential(1)			Consumer			Complexity Risk(2)		Total
Allowance for loan losses
Beginning balance	$	11,156		$	6,670		$	6,487		$	3,521		$	2,281		$	5,964		$	1,010	$	37,089
Charge-offs	(179		)	—			(17		)	(26		)	(14		)	(631		)	—		(867		)
Recoveries	110			38			79			46			22			259			—		554
Provision (credit)	484			(6		)	(37		)	72			(20		)	400			14		907
Provision for acquired loans	(89		)	—			4			(4		)	—			(38		)	—		(127		)
Ending balance	$	11,482		$	6,702		$	6,516		$	3,609		$	2,269		$	5,954		$	1,024	$	37,556
Period-end allowance allocated to:
Loans individually evaluated for impairment	$	1,473		$	—		$	—		$	211		$	911		$	208		$	—	$	2,803
Loans collectively evaluated for impairment	10,005			6,680			6,427			3,398			1,354			5,746			1,024		34,634
Acquired loans evaluated for impairment	4			22			89			—			4			—			—		119
Ending balance	$	11,482		$	6,702		$	6,516		$	3,609		$	2,269		$	5,954		$	1,024	$	37,556
Period-end loan balances:
Loans individually evaluated for impairment (3)	$	5,278		$	1,270		$	2,678		$	1,419		$	15,260		$	7,795		$	—	$	33,700
Loans collectively evaluated for impairment	957,863			839,819			893,036			194,654			161,610			336,053			—		3,383,035
Acquired nonimpaired loans	107,380			49,765			80,795			27,711			73,240			15,803			—		354,694
Acquired impaired loans	12,600			4,603			10,557			3,564			955			5			—		32,284
Ending balance (4)	$	1,083,121		$	895,457		$	987,066		$	227,348		$	251,065		$	359,656		$	—	$	3,803,713

⁽¹⁾  Period-end loan balance excludes Reverse Mortgages, at fair value of $24.7 million.

⁽²⁾  Represents the portion of the allowance for loan losses established to capture factors not already included in other components in our allowance for loan losses methodology.

⁽³⁾  The difference between this amount and nonaccruing loans represents accruing troubled debt restructured loans of $13.9 million for the period ending March 31, 2016. Accruing troubled debt restructured loans are considered impaired loans.

⁽⁴⁾  Ending loan balances do not include net deferred fees.

Nonaccrual and Past Due Loans

Nonaccruing loans are those on which the accrual of interest has ceased. Typically, we discontinue accrual of interest on originated loans after payments become more than 90 days past due or earlier if we do not expect the full collection of principal or interest in accordance with the terms of the loan agreement. Interest accrued but not collected at the date a loan is placed on nonaccrual status is reversed and charged against interest income. In addition, the accretion of net deferred loan fees and amortization of net deferred loan costs is suspended when a loan is placed on nonaccrual status. Subsequent cash receipts are applied either to the outstanding principal balance or recorded as interest income, depending on our assessment of the ultimate collectability of principal and interest. Loans greater than 90 days past due and still accruing are defined as loans contractually past due 90 days or more as to principal or interest payments, but which remain in accrual status because they are considered well secured and are in the process of collection.

24

The following tables show our nonaccrual and past due loans at the dates indicated:

	March 31, 2017
(Dollars in thousands)	30–59 Days Past Due  and Still  Accruing			60–89 Days Past Due and Still  Accruing			Greater  Than 90 Days Past Due and Still Accruing			Total Past Due And Still Accruing			Accruing Current Balances			Acquired Impaired Loans			Nonaccrual Loans			Total Loans
Commercial	$	783		$	467		$	—		$	1,250		$	1,316,841		$	5,256		$	16,520		$	1,339,867
Owner-occupied commercial	341			500			—			841			1,075,391			12,040			4,020			1,092,292
Commercial mortgages	451			—			343			794			1,144,617			10,450			9,695			1,165,556
Construction	37			—			466			503			252,885			2,372			—			255,760
Residential(1)	2,020			119			850			2,989			250,443			866			4,957			259,255
Consumer	374			612			106			1,092			459,057			263			4,486			464,898
Total (2)	$	4,006		$	1,698		$	1,765		$	7,469		$	4,499,234		$	31,247		$	39,678		$	4,577,628
% of Total Loans	0.08		%	0.04		%	0.04		%	0.16		%	98.29		%	0.68		%	0.87		%	100		%

⁽¹⁾  Residential accruing current balances excludes Reverse Mortgages at fair value of $22.5 million.

⁽²⁾  The balances above include a total of $675.6 million of acquired nonimpaired loans.

	December 31, 2016
(Dollars in thousands)	30–59 Days Past Due  and Still  Accruing			60–89 Days Past Due  and Still  Accruing			Greater  Than 90 Days Past Due and Still Accruing			Total Past Due And Still Accruing			Accruing Current Balances			Acquired Impaired Loans			Nonaccrual Loans			Total Loans
Commercial	$	1,507		$	278		$	—		$	1,785		$	1,277,748		$	6,183		$	2,015		$	1,287,731
Owner-occupied commercial	116			540			—			656			1,063,306			12,122			2,078			1,078,162
Commercial mortgages	167			—			—			167			1,143,180			10,386			9,821			1,163,554
Construction	132			—			—			132			218,886			3,694			—			222,712
Residential(1)	3,176			638			153			3,967			257,234			860			4,967			267,028
Consumer	392			346			285			1,023			444,642			369			3,995			450,029
Total(2)	$	5,490		$	1,802		$	438		$	7,730		$	4,404,996		$	33,614		$	22,876		$	4,469,216
% of Total Loans	0.12		%	0.04		%	0.01		%	0.17		%	98.56		%	0.75		%	0.51		%	100		%

⁽¹⁾  Residential accruing current balances excludes Reverse Mortgages, at fair value of $22.6 million.

⁽²⁾  The balances above include a total of $724.1 million of acquired nonimpaired loans.

Impaired Loans

Loans for which it is probable we will not collect all principal and interest due according to their contractual terms, which is assessed based on the credit characteristics of the loan and/or payment status, are measured for impairment in accordance with the provisions of SAB 102 and FASB ASC 310, Receivables (ASC 310). The amount of impairment is required to be measured using one of three methods: (1) the present value of expected future cash flows discounted at the loan’s effective interest rate; (2) the fair value of collateral, if the loan is collateral dependent or (3) the loan’s observable market price. If the measure of the impaired loan is less than the recorded investment in the loan, a related allowance is allocated for the impairment.

25

The following tables provide an analysis of our impaired loans at March 31, 2017 and December 31, 2016:

	March 31, 2017
(Dollars in thousands)	Ending Loan Balances		Loans with No Related Reserve (1)		Loans with Related Reserve		Related Reserve		Contractual Principal Balances		Average Loan Balances
Commercial	$	18,550	$	2,598	$	15,952	$	2,040	$	20,197	$	7,535
Owner-occupied commercial	6,210		4,020		2,190		15		6,372		4,155
Commercial mortgages	14,478		4,220		10,258		1,572		19,906		9,288
Construction	4,435		1,117		3,318		564		4,546		2,979
Residential	15,000		8,056		6,944		910		17,904		14,941
Consumer	9,070		7,526		1,544		199		11,578		8,191
Total (2)	$	67,743	$	27,537	$	40,206	$	5,300	$	80,503	$	47,089

⁽¹⁾  Reflects loan balances at or written down to their remaining book balance.

⁽²⁾  The above includes acquired impaired loans totaling $10.7 million in the ending loan balance and $11.8 million in the contractual principal balance.

	December 31, 2016
(Dollars in thousands)	Ending Loan Balances		Loans with No Related Reserve (1)		Loans with Related Reserve		Related Reserve		Contractual Principal Balances		Average Loan Balances
Commercial	$	4,250	$	1,395	$	2,855	$	505	$	5,572	$	5,053
Owner-occupied commercial	4,650		2,078		2,572		15		5,129		3,339
Commercial mortgages	15,065		4,348		10,717		1,433		20,716		7,323
Construction	3,662		—		3,662		303		3,972		2,376
Residential	14,256		7,122		7,134		934		17,298		15,083
Consumer	8,021		6,561		1,460		215		11,978		7,910
Total (2)	$	49,904	$	21,504	$	28,400	$	3,405	$	64,665	$	41,084

⁽¹⁾  Reflects loan balances at or written down to their remaining book balance.

⁽²⁾  The above includes acquired impaired loans totaling $12.8 million in the ending loan balance and $15.0 million in the contractual principal balance.

Interest income of $0.3 million and $0.2 million was recognized on impaired loans during the three months ended March 31, 2017 and March 31, 2016, respectively.

As of March 31, 2017, there were 39 residential loans and 7 commercial loans in the process of foreclosure. The total outstanding balance on the loans was $4.9 million and $2.2 million, respectively. As of December 31, 2016, there were 29 residential loans and 7 commercial loans in the process of foreclosure. The total outstanding balance on the loans was $3.7 million and $3.6 million, respectively.

Reserves on Acquired Nonimpaired Loans

In accordance with FASB ASC 310, loans acquired by the Bank through its mergers with FNBW, Alliance and Penn Liberty are required to be reflected on the balance sheet at their fair values on the date of acquisition as opposed to their contractual values. Therefore, on the date of acquisition establishing an allowance for acquired loans is prohibited. After the acquisition date the Bank performs a separate allowance analysis on a quarterly basis to determine if an allowance for loan loss is necessary. Should the credit risk calculated exceed the purchased loan portfolio’s remaining credit mark, additional reserves will be added to the Bank’s allowance. When a purchased loan becomes impaired after its acquisition, it is evaluated as part of the Bank’s reserve analysis and a specific reserve is established to be included in the Bank’s allowance.

26

Credit Quality Indicators

Below is a description of each of our risk ratings for all commercial loans:

• Pass. These borrowers currently show no indication of deterioration or potential problems and their loans are considered fully collectible

• Special Mention. Borrowers have potential weaknesses that deserve management’s close attention. Borrowers in this category may be experiencing adverse operating trends, for example, declining revenues or margins, high leverage, tight liquidity, or increasing inventory without increasing sales. These adverse trends can have a potential negative effect on the borrower’s repayment capacity. These assets are not adversely classified and do not expose the Bank to significant risk that would warrant a more severe rating. Borrowers in this category may also be experiencing significant management problems, pending litigation, or other structural credit weaknesses.

• Substandard. Borrowers have well-defined weaknesses that require extensive oversight by management. Borrowers in this category may exhibit one or more of the following: inadequate debt service coverage, unprofitable operations, insufficient liquidity, high leverage, and weak or inadequate capitalization. Relationships in this category are not adequately protected by the sound financial worth and paying capacity of the obligor or the collateral pledged on the loan, if any. A distinct possibility exists that the Bank will sustain some loss if the deficiencies are not corrected.

• Doubtful. Borrowers have well-defined weaknesses inherent in the Substandard category with the added characteristic that the possibility of loss is extremely high. Current circumstances in the credit relationship make collection or liquidation in full highly questionable. A doubtful asset has some pending event that may strengthen the asset that defers the loss classification. Such impending events include: perfecting liens on additional collateral, obtaining collateral valuations, an acquisition or liquidation preceding, proposed merger, or refinancing plan.

• Loss. Borrowers are uncollectible or of such negligible value that continuance as a bankable asset is not supportable. This classification does not mean that the asset has absolutely no recovery or salvage value, but rather that it is not practical to defer writing off this asset even though partial recovery may be recognized sometime in the future.

Residential and Consumer Loans

The residential and consumer loan portfolios are monitored on an ongoing basis using delinquency information and loan type as credit quality indicators. These credit quality indicators are assessed in the aggregate in these relatively homogeneous portfolios. Loans that are greater than 90 days past due are generally considered nonperforming and placed on nonaccrual status.

The following tables provide an analysis of loans by portfolio segment based on the credit quality indicators used to determine the Allowance for Loan Loss.

Commercial Credit Exposure

	March 31, 2017
(Dollars in thousands)	Commercial		Owner-occupied Commercial		Commercial Mortgages		Construction		Total Commercial(1)
									Amount		%
Risk Rating:
Special mention	$	17,590	$	6,849	$	21,931	$	1,008	$	47,378
Substandard:
Accrual	41,136		20,162		3,216		4,489		69,003
Nonaccrual	14,660		4,020		8,300		—		26,980
Doubtful	1,860		—		1,395		—		3,255
Total Special Mention and Substandard	75,246		31,031		34,842		5,497		146,616		4	%
Acquired impaired	5,256		12,040		10,450		2,372		30,118		1	%
Pass	1,259,365		1,049,221		1,120,264		247,891		3,676,741		95	%
Total	$	1,339,867	$	1,092,292	$	1,165,556	$	255,760	$	3,853,475	100	%

⁽¹⁾  Table includes $539.6 million of acquired nonimpaired loans as of March 31, 2017.

27

	December 31, 2016
(Dollars in thousands)	Commercial		Owner-occupied Commercial		Commercial Mortgages		Construction		Total Commercial(1)
									Amount		%
Risk Rating:
Special mention	$	17,630	$	11,419	$	34,198	$	—	$	63,247
Substandard:
Accrual	45,067		19,871		239		2,193		67,370
Nonaccrual	1,693		2,078		8,574		—		12,345
Doubtful	322		—		1,247		—		1,569
Total Special Mention and Substandard	64,712		33,368		44,258		2,193		144,531		4	%
Acquired impaired	6,183		12,122		10,386		3,694		32,385		1	%
Pass	1,216,836		1,032,672		1,108,910		216,825		3,575,243		95	%
Total	$	1,287,731	$	1,078,162	$	1,163,554	$	222,712	$	3,752,159	100	%

⁽¹⁾  Table includes $573.5 million of acquired nonimpaired loans as of December 31, 2016.

Residential and Consumer Credit Exposure

(Dollars in thousands)	Residential(2)				Consumer				Total Residential and Consumer(3)
	March 31,		December 31,		March 31,		December 31,		March 31, 2017				December 31, 2016
	2017		2016		2017		2016		Amount		Percent		Amount		Percent
Nonperforming(1)	$	14,280	$	13,547	$	9,030	$	7,863	$	23,310	3	%	$	21,410	3	%
Acquired impaired loans	866		860		263		369		1,129		—	%	1,229		—	%
Performing	244,109		252,621		455,605		441,797		699,714		97	%	694,418		97	%
Total	$	259,255	$	267,028	$	464,898	$	450,029	$	724,153	100	%	$	717,057	100	%

⁽¹⁾  Includes $13.7 million as of March 31, 2017 and $12.4 million as of December 31, 2016 of troubled debt restructured mortgages and home equity installment loans that are performing in accordance with the loans’ modified terms and are accruing interest.

⁽²⁾  Residential performing loans excludes $22.5 million and $22.6 million of Reverse Mortgages at fair value as of March 31, 2017 and December 31, 2016, respectively.

⁽³⁾  Total includes $136.0 million and $150.5 million in acquired nonimpaired loans as of March 31, 2017 and December 31, 2016, respectively.

Troubled Debt Restructurings (TDRs)

TDRs are recorded in accordance with FASB ASC 310-40, Troubled Debt Restructuring by Creditors (ASC 310-40). 

The following table presents the balance of TDRs as of the indicated dates:

(Dollars in thousands)	March 31, 2017		December 31, 2016
Performing TDRs	$	17,260	$	14,336
Nonperforming TDRs	10,778		8,451
Total TDRs	28,038		22,787

Approximately $1.9 million and $1.3 million in related reserves have been established for these loans at March 31, 2017 and December 31, 2016, respectively.

28

The following table presents information regarding the types of loan modifications made for the three months endedMarch 31, 2017:

(Dollars in thousands)	Maturity Date Extension	Discharged in bankruptcy	Other (1)	Total
Commercial	1	—	—	1
Owner-occupied commercial	1	—	—	1
Construction	2	—	—	2
Residential	—	1	—	1
Consumer	—	6	1	7
	4	7	1	12

⁽¹⁾  Other includes underwriting exception.

Principal balances are generally not forgiven when a loan is modified as a TDR. Nonaccruing restructured loans remain in nonaccrual status until there has been a period of sustained repayment performance, typically six months and payment is reasonably assured.

The following table presents loans identified as TDRs during the three months endedMarch 31, 2017 and 2016.

	Three Months Ended March 31,
	2017				2016
(Dollars in thousands)	Pre Modification		Post Modification		Pre Modification		Post Modification
Commercial	$	443	$	443	$	984	$	984
Owner-occupied commercial	3,071		3,071		—		—
Commercial mortgages	—		—		—		—
Construction	1,712		1,712		—		—
Residential	242		242		614		614
Consumer	584		584		215		215
Total	$	6,052	$	6,052	$	1,813	$	1,813

During the three months endedMarch 31, 2017, the TDRs set forth in the table above increased our allowance for loan losses less than $0.3 million, and resulted in no additional charge-offs. For the same period of 2016, the TDRs set forth in the table above had no change on our allowance for loan losses allocation of the related reserve and resulted in charge-offs of less than $0.1 million. During the three months ended March 31, 2017, three TDRs defaulted that had received troubled debt modification during the past twelve months with a total loan amount $0.7 million.

29

7. GOODWILL AND INTANGIBLES

In accordance with FASB ASC 805, Business Combinations (ASC 805) and FASB ASC 350, Intangibles-Goodwill and Other (ASC 350), all assets and liabilities acquired in purchase acquisitions, including goodwill, indefinite-lived intangibles and other intangibles are recorded at fair value.

During the three months ended March 31, 2017, we determined there were no events or other indicators of impairment as it relates to goodwill or other intangibles.

The following table shows the changes in our goodwill during the quarter as well as the allocation of goodwill to our reportable operating segments for purposes of goodwill impairment testing:

	WSFS			Cash		Wealth		Consolidated
(Dollars in thousands)	Bank			Connect		Management		Company
December 31, 2016	$	147,396		$	—	$	20,143	$	167,539
Remeasurement adjustments	(1,635		)	—		56		(1,579		)
Goodwill from business combinations	—			—		—		—
March 31, 2017	$	145,761		$	—	$	20,199	$	165,960

ASC 350 also requires that an acquired intangible asset be separately recognized if the benefit of the intangible asset is obtained through contractual or other legal rights, or if the asset can be sold, transferred, licensed, rented or exchanged, regardless of the acquirer’s intent to do so.

The following tables summarize other intangible assets:

	March 31, 2017
(Dollars in thousands)	Gross Intangible Assets		Accumulated Amortization			Net Intangible Assets		Amortization Period
Core deposits	$	10,658	$	(3,440	)	$	7,218	10 years
Customer relationships	17,561		(3,013		)	14,548		7-15 years
Non-compete agreements	221		(24		)	197		5 years
Loan servicing rights	1,821		(1,092		)	729		10-30 years
Favorable lease asset	1,932		(212		)	1,720		10 months-18 years
Total intangible assets	$	32,193	$	(7,781	)	$	24,412

	December 31, 2016
(Dollars in thousands)	Gross Intangible Assets		Accumulated Amortization			Net Intangible Assets		Amortization Period
Core deposits	$	13,128	$	(5,630	)	$	7,498	10 years
Customer relationships	17,561		(2,612		)	14,949		7-15 years
Non-compete agreements	1,006		(728		)	278		6 months- 5 years
Loan servicing rights	1,708		(1,067		)	641		10-30 years
Favorable lease asset	458		(116		)	342		10 months-15 years
Total intangible assets	$	33,861	$	(10,153	)	$	23,708

Core deposits are amortized over their expected lives using the present value of the benefit of the core deposits and either accelerated or straight-line methods of amortization. During the three months ended March 31, 2017, we recognized amortization expense on other intangible assets of $0.9 million.

30

The following table shows the estimated future amortization expense related to our intangible assets:

(Dollars in thousands)	Amortization of Intangibles
Remaining in 2017	$	2,287
2018	2,965
2019	2,897
2020	2,701
2021	2,329
Thereafter	11,233
Total	$	24,412

8. ASSOCIATE BENEFIT PLANS

Postretirement Medical Benefits

We share certain costs of providing health and life insurance benefits to eligible retired Associates (employees) and their eligible dependents. Previously, all Associates were eligible for these benefits if they reached normal retirement age while working for us. Effective March 31, 2014, we changed the eligibility of this plan to include only those Associates who have achieved ten years of service with us as of March 31, 2014. As of December 31, 2014, we began to use the mortality table issued by the Office of the Actuary of the U.S. Bureau of Census in October 2014 in our calculation.

We account for our obligations under the provisions of FASB ASC 715, Compensation - Retirement Benefits (ASC 715). ASC 715 requires that we recognize the costs of these benefits over an Associate’s active working career. Amortization of unrecognized net gains or losses resulting from experience different from that assumed and from changes in assumptions is included as a component of net periodic benefit cost over the remaining service period of active employees to the extent that such gains and losses exceed 10% of the accumulated postretirement benefit obligation, as of the beginning of the year.

The following are disclosures of the net periodic benefit cost components of postretirement medical benefits measured at January 1, 2017 and 2016.

	Three months ended March 31,
(Dollars in thousands)	2017			2016
Service cost	$	15		$	15
Interest cost	19			19
Prior service cost amortization	(19		)	(7		)
Net gain recognition	(16		)	(15		)
Net periodic benefit cost	$	(1	)	$	12

Alliance Associate Pension Plan

During the fourth quarter of 2015, we completed the acquisition of Alliance and its wholly owned subsidiary, Alliance Bank, headquartered in Broomall, Pennsylvania. At the time of the acquisition we assumed the Alliance pension plan offered to its current associates.

31

The following table shows the net periodic benefit cost components for the Alliance Associate Pension Plan benefits measured at January 1, 2017.

(Dollars in thousands)	Three months ended March 31, 2017
Service cost	$	10
Interest cost	75
Expected Return on Plan Assets	(135		)
Prior service cost amortization	—
Net gain recognition	—
Net periodic benefit cost	$	(50	)

9. INCOME TAXES

We account for income taxes in accordance with FASB ASC 740, Income Taxes (ASC 740). ASC 740 requires the recording of deferred income taxes that reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. We exercise significant judgment in the evaluation of the amount and timing of the recognition of the resulting tax assets and liabilities. The judgments and estimates required for the evaluation are updated based on changes in business factors and the tax laws. If actual results differ from the assumptions and other considerations used in estimating the amount and timing of tax recognized, there can be no assurance that additional expenses will not be required in future periods.

ASC 740 prescribes a minimum probability threshold that a tax position must meet before a financial statement benefit is recognized. We recognize, when applicable, interest and penalties related to unrecognized tax benefits in the provision for income taxes in the financial statements. Assessment of uncertain tax positions under ASC 740 requires careful consideration of the technical merits of a position based on our analysis of tax regulations and interpretations.

There were no unrecognized tax benefits as of March 31, 2017. We record interest and penalties on potential income tax deficiencies as income tax expense. Our federal and state tax returns for the 2013 through 2016 tax years are subject to examination as of March 31, 2017. We do not expect to record or realize any material unrecognized tax benefits during 2017.

As a result of the adoption of ASU No. 2014-01, “Investments-Equity Method and Joint Ventures: Accounting for Investments in Qualified Affordable Housing Projects,” the amortization of our low-income housing credit investments has been reflected as income tax expense. Accordingly, $0.4 million of such amortization has been reflected as income tax expense for the three months ended March 31, 2017 compared to $0.4 million for the same period in 2016.

The amount of affordable housing tax credits, amortization and tax benefits recorded as income tax expense for the three months ended March 31, 2017 were $0.4 million, $0.4 million and $0.1 million, respectively. The carrying value of the investment in affordable housing credits is $15.0 million at March 31, 2017, compared to $15.4 million at December 31, 2016.

10. STOCK-BASED COMPENSATION

Stock-based compensation is accounted for in accordance with FASB ASC 718, Stock Compensation. Compensation expense relating to all share-based payments is recognized on a straight-line basis over the applicable vesting period. Our Stock Incentive Plans provide for the granting of stock options, stock appreciation rights, performance awards, restricted stock and restricted stock unit awards, deferred stock units, and other awards that are payable in or valued by reference to our common shares. The number of shares reserved for issuance under our 2013 Incentive Plan (2013 Plan) is 2,096,535. At March 31, 2017, there were 490,926 shares available for future grants under the 2013 Plan.

We record stock-based compensation expense related to awards granted to Associates in Salaries, benefits and other compensation; expense related to awards granted to directors is recorded in Other operating expense in our Consolidated Statements of Income. Total stock-based compensation expense recognized during the three months endedMarch 31, 2017 and 2016 was $0.9 million ($0.6 million after tax) and $0.8 million ($0.4 million after tax), respectively.

32

Stock Options

Stock options are granted with an exercise price not less than the fair market value of our common stock on the date of the grant. All stock options are to be granted at not less than the fair market value of our common stock on the date of the grant. All stock options granted during 2017 and 2016 vest in 25% per annum increments, start to become exercisable one year from the grant date and expire seven years from the grant date. Generally, all awards become exercisable immediately in the event of a change in control, as defined within the Stock Incentive Plans. We issue new shares upon the exercise of options.

We determine the grant date fair value of stock options using the Black-Scholes option-pricing model. The model requires the use of numerous assumptions, many of which are subjective. The expected term was derived from historical exercise patterns and represents the amount of time that stock options granted are expected to be outstanding. Other significant assumptions to determine 2017 and 2016 grant date fair value included volatility measured using the fluctuation in month end closing stock prices over a period which corresponds with the average expected option life; a weighted-average risk-free rate of return (zero coupon treasury yield); and a dividend yield indicative of our current dividend rate

The following table summarizes the assumptions we used to value options issued during the three months ended March 31, 2017 and 2016:

	March 31, 2017		March 31, 2016
Expected Term (in years)	5.3		5.3
Volatility	24.85	%	29.60	%
Weighted-average risk free interest rate	1.95	%	1.24	%
Dividend Yield	0.6	%	0.8	%

The following table summarizes our stock option activity for the three months endedMarch 31, 2017.

	Three months ended March 31, 2017
	Shares			Weighted- Average Exercise Price
Stock Options:
Outstanding at beginning of period	1,547,980			17.83
Granted	45,134			47.05
Exercised	(117,612		)	15.47
Forfeited	(750		)	15.83
Outstanding at end of period	1,474,752			18.91
Nonvested at end of period	424,459			23.64
Exercisable at end of period	1,050,293			17.00
Weighted-average fair value of options granted	$	11.50

The following table provides information about our nonvested stock options outstanding at March 31, 2017:

	March 31, 2017
	Shares			Weighted- Average Exercise Price
Stock Options:
Nonvested at beginning of period	$	704,421		$	19.08
Granted	45,134			47.05
Forfeited	(750		)	15.83
Vested during period	(324,346		)	17.01
Nonvested at end of period	$	424,459		23.64

The total amount of unrecognized compensation cost related to nonvested stock options as of March 31, 2017 was $5.5 million. The weighted-average period over which the expense is expected to be recognized is 1.86 years. During the first quarter of 2017, we recognized $0.5 million of compensation expense related to these awards.

33

Restricted Stock Units

Restricted stock units (RSUs) are granted at no cost to the recipient and generally vest over a four year period. All outstanding awards granted to senior executives vest over no less than a four year period. The 2013 Plan allows for awards with vesting periods less than four years subject to Board approval. The fair value of RSUs is equal to the fair value of the Company’s common stock on the date of grant. We recognize the expense related to RSUs granted to Associates in Salaries, benefits and other compensation expense; expense related to awards granted to directors is recorded in Other operating expense in our Statements of Income on an accrual basis over the requisite service period for the entire award.

The Long-Term Performance-Based Restricted Stock Unit program (Long-Term Program) provided for awards up to an aggregate of 233,400 RSUs to participants, only after the achievement of targeted levels of return on assets (ROA) in any year through 2013. During 2013, the Company achieved the 1.00% ROA performance level. In accordance with the Long-Term Program, the Company issued 108,456 RSUs to the plan’s participants in 2014. The RSUs vest in 25% increments over four years and we recognize expense over the implicit service period associated with the performance condition. During the first quarter of 2017, we recognized $0.1 of compensation expense related to this program.

The following table summarizes the Company’s RSAs and RSUs, including performance awards, and changes during the three months ended March 31, 2017:

	Three months ended March 31, 2017
	Units (in whole)			Weighted Average Grant-Date Fair Value per Unit
Outstanding at beginning of period	$	135,592		$	27.14
Granted	36,523			47.05
Vested	(33,803		)	20.22
Forfeited	(1,823		)	27.21
Outstanding at end of period	$	136,489		34.20

The total amount of compensation cost to be recognized relating to non-vested restricted stock, including performance awards, as of March 31, 2016, was $7.0 million. The weighted-average period over which the expense is expected to be recognized is 3.2 years. During the three months endedMarch 31, 2017, we recognized $0.2 million of compensation cost related to these awards.

11. FAIR VALUE DISCLOSURES OF FINANCIAL ASSETS AND LIABILITIES

FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES

ASC 820-10 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820-10 establishes a fair value hierarchy that prioritizes the use of inputs used in valuation methodologies into the following three levels:

• Level 1: Inputs to the valuation methodology are quoted prices, unadjusted, for identical assets or liabilities in active markets. A quoted price in an active market provides the most reliable evidence of fair value and shall be used to measure fair value whenever available.

• Level 2: Inputs to the valuation methodology include quoted prices for similar assets or liabilities in active markets; inputs to the valuation methodology include quoted prices for identical or similar assets or liabilities in markets that are not active; or inputs to the valuation methodology that are derived principally from or can be corroborated by observable market data by correlation or other means.

• Level 3: Inputs to the valuation methodology are unobservable and significant to the fair value measurement. Level 3 assets and liabilities include financial instruments whose value is determined using discounted cash flow methodologies, as well as instruments for which the determination of fair value requires significant management judgment or estimation.

34

The following tables present financial instruments carried at fair value as of March 31, 2017 and December 31, 2016 by level in the valuation hierarchy (as described above):

	March 31, 2017
(Dollars in thousands)	Quoted Prices in Active Markets for Identical Asset (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Fair Value
Assets measured at fair value on a recurring basis:
Available-for-sale securities:
CMO	$	—	$	277,711	$	—	$	277,711
FNMA MBS	—		386,051		—		386,051
FHLMC MBS	—		64,171		—		64,171
GNMA MBS	—		27,597		—		27,597
GSE	—		32,981		—		32,981
Other investments	614		—		—		614
Other assets	—		1,108		—		1,108
Total assets measured at fair value on a recurring basis	$	614	$	789,619	$	—	$	790,233
Liabilities measured at fair value on a recurring basis:
Other liabilities	$	—	$	3,194	$	—	$	3,194
Assets measured at fair value on a nonrecurring basis:
Other real estate owned	$	—	$	—	$	3,582	$	3,582
Loans held for sale	—		29,394		—		29,394
Impaired loans, net	—		—		62,443		62,443
Total assets measured at fair value on a nonrecurring basis	$	—	$	29,394	$	66,025	$	95,419

	December 31, 2016
(Dollars in thousands)	Quoted Prices in Active Markets for Identical Asset (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Fair Value
Assets measured at fair value on a recurring basis:
Available-for-sale securities:
CMO	$	—	$	261,215	$	—	$	261,215
FNMA MBS	—		405,764		—		405,764
FHLMC MBS	—		63,515		—		63,515
GNMA MBS	—		28,416		—		28,416
GSE	—		35,010		—		35,010
Other investments	623		—		—		623
Other assets	—		1,508		—		1,508
Total assets measured at fair value on a recurring basis	$	623	$	795,428	$	—	$	796,051
Liabilities measured at fair value on a recurring basis:
Other liabilities	—		3,380		—		3,380
Assets measured at fair value on a nonrecurring basis
Other real estate owned	—		—		3,591		3,591
Loans held for sale	—		54,782		—		54,782
Impaired loans, net	—		—		46,499		46,499
Total assets measured at fair value on a nonrecurring basis	$	—	$	54,782	$	50,090	$	104,872

35

There were no transfers between Level 1 and Level 2 of the fair value hierarchy during the three months ending March 31, 2017.

Fair value is based on quoted market prices, where available. If such quoted market prices are not available, fair value is based on internally developed models or obtained from third parties that primarily use, as inputs, observable market-based parameters. Valuation adjustments may be made to ensure that financial instruments are recorded at fair value. These adjustments may include unobservable parameters. Our valuation methodologies may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. While we believe our valuation methodologies are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different estimate of fair value at the reporting date.

Available-for-sale securities

As of March 31, 2017, securities classified as available-for-sale are reported at fair value using Level 2 inputs, except for one mutual fund asset acquired as part of the Penn Liberty acquisition, which is categorized as Level 1. Included in the Level 2 total are approximately $33.0 million in U.S. Treasury Notes and Federal Agency debentures, and $755.5 million in Federal Agency MBS. We believe that this Level 2 designation is appropriate for these securities under ASC 820-10 as, with almost all fixed income securities, none are exchange traded, and all are priced by correlation to observed market data. For these securities we obtain fair value measurements from an independent pricing service. The fair value measurements consider observable data that may include dealer quotes, market spreads, cash flows, U.S. government and agency yield curves, live trading levels, trade execution data, market consensus prepayment speeds, credit information, and the security’s terms and conditions, among other factors.

Other real estate owned

Other real estate owned consists of loan collateral which has been repossessed through foreclosure or other measures. Initially, foreclosed assets are recorded at the lower of the loan balance or fair value of the collateral less estimated selling costs. Subsequent to foreclosure, valuations are updated periodically and the assets may be marked down further, reflecting a new cost basis. The fair value of our real estate owned was estimated using Level 3 inputs based on appraisals obtained from third parties.

Loans held for sale

The fair value of our loans held for sale is based on estimates using Level 2 inputs. These inputs are based on pricing information obtained from secondary markets and brokers and applied to loans with similar interest rates and maturities.

Impaired loans

We evaluate and value impaired loans at the time the loan is identified as impaired, and the fair values of such loans are estimated using Level 3 inputs in the fair value hierarchy. Each loan’s collateral has a unique appraisal and management’s discount of the value is based on the factors unique to each impaired loan. The significant unobservable input in determining the fair value is management’s subjective discount on appraisals of the collateral securing the loan, which range from 10% - 50%. Collateral may consist of real estate and/or business assets including equipment, inventory and/or accounts receivable and the value of these assets is determined based on the appraisals by qualified licensed appraisers hired by us. Appraised and reported values may be discounted based on management’s historical knowledge, changes in market conditions from the time of valuation, estimated costs to sell, and/or management’s expertise and knowledge of the client and the client’s business.

The gross amount of impaired loans, which are measured for impairment by either calculating the expected future cash flows discounted at the loan’s effective interest rate or determining the fair value of the collateral for collateral dependent loans was $67.7 million and $51.6 million at March 31, 2017 and December 31, 2016, respectively. The valuation allowance on impaired loans was $5.3 million as of March 31, 2017 and $3.4 million as of December 31, 2016.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The reported fair values of financial instruments are based on a variety of factors. In certain cases, fair values represent quoted market prices for identical or comparable instruments. In other cases, fair values have been estimated based on assumptions regarding the amount and timing of estimated future cash flows that are discounted to reflect current market rates and varying degrees of risk. Accordingly, the fair values may not represent actual values of the financial instruments that could have been realized as of period-end or that will be realized in the future.

36

The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate that value:

Cash and cash equivalents

For cash and short-term investment securities, including due from banks, federal funds sold or purchased under agreements to resell and interest-bearing deposits with other banks, the carrying amount is a reasonable estimate of fair value.

Investment securities

Fair value is estimated using quoted prices for similar securities, which we obtain from a third party vendor. We utilize one of the largest providers of securities pricing to the industry and management periodically assesses the inputs used by this vendor to price the various types of securities owned by us to validate the vendor’s methodology.

Loans held for sale

Loans held for sale are carried at their fair value (see discussion in “Fair Value of Financial Assets and Liabilities” section above).

Loans

Fair values are estimated for portfolios of loans with similar financial characteristics. Loans are segregated by type: commercial, commercial mortgages, owner-occupied commercial, construction, residential mortgages and consumer. For loans that reprice frequently, the book value approximates fair value. The fair values of other types of loans, with the exception of reverse mortgages, are estimated by discounting expected cash flows using the current rates at which similar loans would be made to borrowers with comparable credit ratings and for similar remaining maturities. The fair values of reverse mortgages are based on the net present value of the expected cash flows using a discount rate specific to the reverse mortgages portfolio. The fair value of nonperforming loans is based on recent external appraisals of the underlying collateral. Estimated cash flows, discounted using a rate commensurate with current rates and the risk associated with the estimated cash flows, are utilized if appraisals are not available. This technique does not contemplate an exit price.

Stock in the Federal Home Loan Bank (FHLB) of Pittsburgh

The fair value of FHLB stock is assumed to be equal to its cost basis, since the stock is non-marketable but redeemable at its par value.

Other assets

Other assets includes, among others, other real estate owned (see discussion earlier in this note) and our investment in Visa Class B stock. Our ownership includes shares acquired at no cost from our prior participation in Visa’s network, while Visa operated as a cooperative. During 2016 and 2017 we purchased additional shares which are accounted for as non-marketable equity securities and carried at cost. We evaluated the shares carried at cost for OTTI as of March 31, 2017, and the evaluation showed no OTTI as of March 31, 2017. Following resolution of Visa’s covered litigation, shares of Visa’s Class B stock will be converted to Visa Class A shares.

While only current owners of Class B shares are allowed to purchase other Class B shares, there have been several transactions between Class B shareholders. Based on these transactions we estimate the value of our Visa Class B shares to be $23.1 million as of March 31, 2017.

Deposits

The fair value of deposits with no stated maturity, such as noninterest-bearing demand deposits, money market and interest-bearing demand deposits, is assumed to be equal to the amount payable on demand. The fair value of time deposits is based on the discounted value of contractual cash flows. The discount rate is estimated using rates currently offered for deposits with comparable remaining maturities.

Borrowed funds

Rates currently available to us for debt with similar terms and remaining maturities are used to estimate fair value of existing debt.

37

Other Liabilities

Other liabilities includes cash flow derivatives and derivative on the residential mortgage held for sale pipeline.

Off-balance sheet instruments

The fair value of off-balance sheet instruments, including commitments to extend credit and standby letters of credit, approximates the recorded net deferred fee amounts, which are not significant. Because commitments to extend credit and letters of credit are generally not assignable by either us or the borrower, they only have value to us and the borrower.

The book value and estimated fair value of our financial instruments are as follows:

(Dollars in thousands)	Fair Value	March 31, 2017				December 31, 2016
	Measurement	Book Value		Fair Value		Book Value		Fair Value
Financial assets:
Cash and cash equivalents	Level 1	$	855,263	$	855,263	$	821,923	$	821,923
Investment securities available for sale	See previous table	789,125		789,125		794,543		794,543
Investment securities held to maturity	Level 2	163,611		163,241		164,346		163,232
Loans, held for sale	Level 2	29,394		29,394		54,782		54,782
Loans, net(1)(2)	Level 2, 3	4,489,708		4,450,924		4,397,876		4,300,963
Impaired loans, net	Level 3	62,443		62,443		46,499		46,499
Stock in FHLB of Pittsburgh	Level 2	20,002		20,002		38,248		38,248
Accrued interest receivable	Level 2	16,712		16,712		17,027		17,027
Other assets	Level 3	13,920		28,527		9,189		15,787
Financial liabilities:
Deposits	Level 2	5,376,830		5,040,211		4,738,438		4,423,921
Borrowed funds	Level 2	700,849		697,952		1,267,447		1,264,170
Standby letters of credit	Level 3	507		507		468		468
Accrued interest payable	Level 2	2,931		2,931		1,151		1,151
Other liabilities	Level 2	3,194		3,194		3,380		3,380

 ⁽¹⁾ Excludes impaired loans, net.

 ⁽²⁾ Includes reverse mortgage loans, which are categorized as Level 3.

At March 31, 2017 and December 31, 2016 we had no commitments to extend credit measured at fair value.

12. DERIVATIVE FINANCIAL INSTRUMENTS

Risk Management Objective of Using Derivatives

We are exposed to certain risks arising from both our business operations and economic conditions. We principally manage our exposures to a wide variety of business and operational risks through management of our core business activities. We manage economic risks, including interest rate, liquidity, and credit risk, primarily by managing the amount, sources, and duration of our assets and liabilities. We manage a matched book with respect to our derivative instruments in order to minimize our net risk exposure resulting from such transactions.

38

Fair Values of Derivative Instruments

The table below presents the fair value of our derivative financial instruments as well as their location on the Consolidated Statements of Financial Condition as of March 31, 2017.

	Fair Values of Derivative Instruments
(Dollars in thousands)		Count	Notional		Balance Sheet Location	Liability Derivatives (Fair Value)
Derivatives designated as hedging instruments:
Interest rate products		3	$	75,000	Other Liabilities	$	3,039
Total derivatives designated as hedging instruments						$	3,039

Cash Flow Hedges of Interest Rate Risk

Our objectives in using interest rate derivatives are to add stability to interest expense and to manage our exposure to interest rate movements. To accomplish this objective, we primarily use interest rate swaps as part of our interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for us making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount.

The effective portion of changes in the fair value of derivatives designated and that qualify as cash flow hedges is recorded in accumulated other comprehensive income and is subsequently reclassified into earnings in the period that the hedged forecast transaction affects earnings. During the three months endedMarch 31, 2017, such derivatives were used to hedge the variable cash flows associated with a forecasted issuance of debt. The ineffective portion of the change in fair value of the derivatives is recognized directly in earnings. During the three months endedMarch 31, 2017, we did not record any hedge ineffectiveness.

Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on our variable-rate debt. During the next twelve months, we estimate that less than $0.1 million will be reclassified as an increase to interest expense.

We are hedging our exposure to the variability in future cash flows for forecasted transactions over a maximum period of 1 month (excluding forecasted transactions related to the payment of variable interest on existing financial instruments).

As of March 31, 2017, we had three outstanding interest rate derivatives with a notional of $75 million that were designated as cash flow hedges of interest rate risk.

Effect of Derivative Instruments on the Income Statement

The table below presents the effect of the derivative financial instruments on the Consolidated Statements of Income for the three months endedMarch 31, 2017 and March 31, 2016 .

(Dollars in thousands)	Amount of (Loss) or Gain Recognized in OCI on Derivative (Effective Portion)					Location of (Loss) or Gain Reclassified from Accumulated OCI into Income (Effective Portion)
	Three months ended March 31,
Derivatives in Cash Flow Hedging Relationships	2017			2016
Interest Rate Products	$	(3,039	)	$	—	Interest expense
Total	$	(3,039	)	$	—

Credit-risk-related Contingent Features

We have agreements with certain of our derivative counterparties that contain a provision where if we default on any of our indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, then we could also be declared in default on our derivative obligations.

We also have agreements with certain of our derivative counterparties that contain a provision where if we fail to maintain our status as a well/adequately capitalized institution, then the counterparty could terminate the derivative positions and we would be required to settle our obligations under the agreements.

39

As of March 31, 2017, the termination value of derivatives in a net liability position, which includes accrued interest but excludes any adjustment for nonperformance risk, related to these agreements was $3.0 million. We have minimum collateral posting thresholds with certain of our derivative counterparties, and have posted collateral of $3.4 million against our obligations under these agreements. If we had breached any of these provisions at March 31, 2017, we could have been required to settle our obligations under the agreements at the termination value.

13. SEGMENT INFORMATION

As defined in FASB ASC 280, Segment Reporting (ASC 280), an operating segment is a component of an enterprise that engages in business activities from which it may earn revenues and incur expenses, whose operating results are regularly reviewed by the enterprise’s chief operating decision makers to make decisions about resources to be allocated to the segment and assess its performance, and for which discrete financial information is available. We evaluate performance based on pretax ordinary income relative to resources used, and allocate resources based on these results. The accounting policies applicable to our segments are those that apply to our preparation of the accompanying unaudited Consolidated Financial Statements. Based on these criteria, we have identified three segments: WSFS Bank, Cash Connect^®, and Wealth Management.

The WSFS Bank segment provides financial products to commercial and retail customers. Retail and Commercial Banking, Commercial Real Estate Lending and other banking business units are operating departments of WSFS Bank. These departments share the same regulator, the same market, many of the same customers and provide similar products and services through the general infrastructure of the Bank. Accordingly, these departments are not considered discrete segments and are appropriately aggregated within the WSFS Bank segment in accordance with ASC 280.

Cash Connect^® provides ATM vault cash and smart safe and cash logistics services through strategic partnerships with several of the largest networks, manufacturers and service providers in the ATM industry. The balance sheet category “Cash in non-owned ATMs” includes cash from which fee income is earned through bailment arrangements with customers of Cash Connect^®.

The Wealth Management segment provides a broad array of fiduciary, investment management, credit and deposit products to clients through six business lines. WSFS Wealth Investments provides insurance and brokerage products primarily to our retail banking clients. Cypress Capital Management, LLC is a registered investment advisor. Cypress’ primary market segment is high net worth individuals, offering a ‘balanced’ investment style focused on preservation of capital and current income. West Capital Management, a registered investment advisor, is a fee-only wealth management firm which operates under a multi-family office philosophy and provides fully-customized solutions tailored to the unique needs of institutions and high net worth individuals. Christiana Trust provides fiduciary and investment services to personal trust clients, and trustee, agency, bankruptcy administration, custodial and commercial domicile services to corporate and institutional clients. Powdermill Financial Solutions is a multi-family office that specializes in providing unique, independent solutions to high net worth individuals, families and corporate executives through a coordinated, centralized approach. WSFS Private Banking serves high net worth clients by delivering credit and deposit products and partnering with other business units to deliver investment management and fiduciary products and services.

40

Segment information for the three months ended March 31, 2017 and 2016 is as follows:

	Three months ended March 31, 2017
(Dollars in thousands)	WSFS Bank		Cash Connect®		Wealth Management		Total
Statement of Income
External customer revenues:
Interest income	$	58,688	$	—	$	2,138	$	60,826
Noninterest income	10,167		9,677		8,248		28,092
Total external customer revenues	68,855		9,677		10,386		88,918
Inter-segment revenues:
Interest income	1,996		—		2,065		4,061
Noninterest income	2,164		191		36		2,391
Total inter-segment revenues	4,160		191		2,101		6,452
Total revenue	73,015		9,868		12,487		95,370
External customer expenses:
Interest expense	7,463		—		260		7,723
Noninterest expenses	38,960		6,135		6,411		51,506
Provision for loan losses	1,716		—		446		2,162
Total external customer expenses	48,139		6,135		7,117		61,391
Inter-segment expenses:
Interest expense	2,065		1,405		591		4,061
Noninterest expenses	227		715		1,449		2,391
Total inter-segment expenses	2,292		2,120		2,040		6,452
Total expenses	50,431		8,255		9,157		67,843
Income before taxes	$	22,584	$	1,613	$	3,330	$	27,527
Income tax provision							8,590
Consolidated net income							18,937
Capital expenditures	$	2,088	$	22	$	254	$	2,364

	March 31, 2017
(Dollars in thousands)	WSFS Bank		Cash Connect®		Wealth Management		Total
Statement of Financial Condition
Cash and cash equivalents	$	99,812	$	751,201	$	4,250	$	855,263
Goodwill	145,761		—		20,199		165,960
Other segment assets	5,608,912		4,097		218,667		5,831,676
Total segment assets	$	5,854,485	$	755,298	$	243,116	$	6,852,899

41

	Three months ended March 31, 2016
(Dollars in thousands)	WSFS Bank		Cash Connect®			Wealth Management			Total
Statement of Income
External customer revenues:
Interest income	$	48,038	$	—		$	2,008		$	50,046
Noninterest income	9,852		8,271		(r)	5,545			23,668
Total external customer revenues	57,890		8,271			7,553			73,714
Inter-segment revenues:
Interest income	1,061		—			1,895			2,956
Noninterest income	2,060		193			24			2,277
Total inter-segment revenues	3,121		193			1,919			5,233
Total revenue	61,011		8,464			9,472			78,947
External customer expenses:
Interest expense	4,497		—			193			4,690
Noninterest expenses	33,812		5,448		(r)	4,537			43,797
Provision for loan losses	815		—			(35		)	780
Total external customer expenses	39,124		5,448			4,695			49,267
Inter-segment expenses
Interest expense	1,895		555			506			2,956
Noninterest expenses	217		715			1,345			2,277
Total inter-segment expenses	2,112		1,270			1,851			5,233
Total expenses	41,236		6,718			6,546			54,500
Income before taxes	$	19,775	$	1,746		$	2,926		$	24,447
Income tax provision									8,677
Consolidated net income									15,770
Capital expenditures	$	1,211	$	20		$	2		$	1,233

	December 31, 2016
(Dollars in thousands)	WSFS Bank		Cash Connect®		Wealth Management		Total
Statement of Financial Condition
Cash and cash equivalents	$	100,893	$	717,643	$	3,387	$	821,923
Goodwill	147,396		—		20,143		167,539
Other segment assets	5,545,611		3,533		226,664		5,775,808
Total segment assets	$	5,793,900	$	721,176	$	250,194	$	6,765,270

^(r) Noninterest income and Noninterest expense for the period ended March 31, 2016 have been restated to correct an immaterial error related to revenue earned for cash servicing fees. See Note 1 - Basis of Presentation for further information.

42

14. INDEMNIFICATIONS AND GUARANTEES

Secondary Market Loan Sales

Given the current interest rate environment, coupled with our desire not to hold newly originated residential mortgage loans in our portfolio, we generally sell these assets in the secondary market to mortgage loan aggregators and on a more limited basis, to GSEs such as FHLMC, FNMA, and the FHLB. Loans held for sale are reflected on our unaudited Consolidated Statements of Financial Condition at fair value with changes in the value reflected in our unaudited Consolidated Statements of Income. Gains and losses are recognized at the time of sale. We periodically retain the servicing rights on residential mortgage loans sold which results in monthly service fee income. The mortgage servicing rights are included in our intangible assets in our unaudited Consolidated Statements of Financial Condition. Otherwise, we sell loans with servicing released on a nonrecourse basis. Rate-locked loan commitments that we intend to sell in the secondary market are accounted for as derivatives under ASC Topic 815, Derivatives and Hedging (ASC:815).

We generally do not sell loans with recourse, except for standard loan sale contract provisions covering violations of representations and warranties and, under certain circumstances, early payment default by the borrower. These are customary repurchase provisions in the secondary market for residential mortgage loan sales. These provisions may include either an indemnification from loss or the repurchase of the loans. Repurchases and losses have been rare and no provision is made for losses at the time of sale. There were no such repurchases for the three months ended March 31, 2017.

Swap Guarantees

We entered into agreements with three unrelated financial institutions whereby those financial institutions entered into interest rate derivative contracts (interest rate swap transactions) with customers referred to them by us. Under the terms of the agreements, those financial institutions have recourse to us for any exposure created under each swap transaction in the event that the customer defaults on the swap agreement and the agreement is in a paying position to the third-party financial institution. This is a customary arrangement that allows us to provide access to interest rate swap transactions for our customers without creating the swap ourselves. These swap guarantees are accounted for as credit derivatives. 

At both March 31, 2017 and December 31, 2016, there were 134 variable-rate to fixed-rate swap transactions between the third party financial institutions and our customers. The initial notional aggregate amount was approximately $538.7 million at March 31, 2017 compared to $518.8 million at December 31, 2016. At March 31, 2017 maturities ranged from under one year to twenty years. The aggregate market value of these swaps to the customers was a liability of $10.0 million at March 31, 2017 and $10.9 million at December 31, 2016. We had no reserves for the swap guarantees as of March 31, 2017.

15. CHANGE IN ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME

Accumulated other comprehensive (loss) income includes unrealized gains and losses on available-for-sale investments, unrealized gains and losses on cash flow hedges, as well as unrecognized prior service costs, transition costs, and actuarial gains and losses on defined benefit pension plans. Changes to accumulated other comprehensive (loss) income are presented net of tax as a component of stockholder's equity. Amounts that are reclassified out of accumulated other comprehensive (loss) income are recorded on the Consolidated Statement of Income either as a gain or loss.

43

Changes to accumulated other comprehensive (loss) income by component are shown net of taxes in the following tables for the period indicated:

(Dollars in thousands)	Net change  in investment securities available for sale			Net change in securities held to maturity			Net change in defined benefit plan			Net change in fair value of derivative used for cash flow hedge			Total
Balance, December 31, 2016	$	(8,194	)	$	1,392		$	957		$	(1,772	)	$	(7,617	)
Other comprehensive income (loss) before reclassifications	1,272			—			—			(112		)	1,160
Less: Amounts reclassified from accumulated other comprehensive loss	(206		)	(101		)	(23		)	—			(330		)
Net current-period other comprehensive income (loss)	1,066			(101		)	(23		)	(112		)	830
Balance, March 31, 2017	$	(7,128	)	$	1,291		$	934		$	(1,884	)	$	(6,787	)
Balance, December 31, 2015	$	(1,887	)	$	1,795		$	788		$	—		$	696
Other comprehensive income before reclassifications	10,572			—			—			—			10,572
Less: Amounts reclassified from accumulated other comprehensive income	(189		)	(103		)	478			—			186
Net current-period other comprehensive income (loss)	10,383			(103		)	478			—			10,758
Balance, March 31, 2016	$	8,496		$	1,692		$	1,266		$	—		$	11,454

The Consolidated Statements of Income were impacted by components of other comprehensive income (loss) as shown in the table below:

							Affected line item in
	Three Months Ended						Consolidated
(Dollars in thousands)	March 31,						Statements of Income
	2017			2016
Securities available for sale:
Realized gains on securities transactions	$	(320	)	$	(305	)	Security gains, net
Income taxes	114			116			Income tax provision
Net of tax	$	(206	)	$	(189	)
Net unrealized holding gains on securities transferred between available-for-sale and held-to-maturity:
Amortization of net unrealized gains to income during the period	$	(160	)	$	(168	)	Interest income on investment securities
Income taxes	59			65			Income tax provision
Net of tax	$	(101	)	$	(103	)
Amortization of Defined Benefit Pension items:
Prior service (credits) costs	$	(19	)	$	(7	)
Actuarial (gains) losses	(16		)	791
Total before tax	$	(35	)	$	784		Salaries, benefits and other compensation
Income taxes	12			(306		)	Income tax provision
Net of tax	(23		)	478
Total reclassifications	$	(330	)	$	186

44

16. RELATED PARTY TRANSACTIONS

In the ordinary course of business, from time to time we enter into transactions with related parties, including, but not limited to, our officers and directors. These transactions are made on substantially the same terms and conditions, including interest rates and collateral requirements, as those prevailing at the same time for comparable transactions with other customers. They do not, in the opinion of management, involve greater than normal credit risk or include other unfavorable features.

The outstanding balances of loans to related parties at March 31, 2017 and December 31, 2016 were $1.6 million and $1.3 million, respectively. Total deposits from related parties at March 31, 2017 and December 31, 2016 were $6.3 million and $3.6 million, respectively. During the first quarter of 2017, new loans and credit line advances to related parties totaled $0.4 million and repayments were less than $0.1 million.

17. LEGAL AND OTHER PROCEEDINGS

In accordance with the current accounting standards for loss contingencies, we establish reserves for litigation-related matters that arise in the ordinary course of our business activities when it is probable that a loss associated with a claim or proceeding has been incurred and the amount of the loss can be reasonably estimated. Litigation claims and proceedings of all types are subject to many uncertain factors that generally cannot be predicted with assurance.

From time to time we are brought into certain legal matters and/or disputes through our Wealth Management segment, as a result of sometimes highly complex documents and servicing requirements that are part of this business. While the outcomes carry some degree of uncertainty, management does not currently anticipate that the ultimate liability, if any, arising out of such other proceedings we are aware of, will have a material effect on the Consolidated Financial Statements.

On April 7, 2015, WSFS Bank received a notice of arbitration and statement of claim (the Claim) from Universitas Education, LLC (Universitas) relating to Christiana Trust acting as “insurance trustee” of the Charter Oak Trust Welfare Benefit Plan (the Trust). The actions underlying the Claim occurred during a period prior to WSFS Corp’s acquisition of Christiana Trust. According to the allegations contained in the Claim, certain death benefits made payable to the asserted trustee of the Trust were misappropriated by individuals associated with that trustee and plan sponsor. None of those individuals, however, were employed by or agents of Christiana Trust or WSFS Bank. It also is alleged that Christiana Trust breached its fiduciary duty and engaged in fraud, negligence and statutory theft in connection with the disappearance of the misappropriated funds. It is further alleged that Universitas was the rightful beneficiary under the Trust of the misappropriated funds, and thus was harmed because it did not receive the death benefits that had been paid over to the asserted trustee of the Trust. The Claim subsequently was amended to add a count for breach of contract. The Claim seeks an award of approximately $30 million plus interest, as well as the costs incurred by Universitas in pursuing the Claim and statutory and other penalties. WSFS is vigorously defending itself against the Claim and believes that it has valid factual and legal defenses to the Claim. WSFS does not believe that the ultimate resolution of the Claim will have a material adverse effect on the Company, but there can be no assurance as to the ultimate outcome.

There were no material changes or additions to other significant pending legal or other proceedings involving us other than those arising out of routine operations.

45

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

OVERVIEW

The Company is a savings and loan holding company headquartered in Wilmington, Delaware. Substantially all of our assets are held by the Company’s subsidiary, Wilmington Savings Fund Society, FSB, or WSFS Bank, one of the ten oldest bank and trust companies continuously operating under the same name in the United States (U.S.). At $6.85 billion in assets and $17.57 billion in assets under management and administration, WSFS Bank is also the largest bank and trust company headquartered in the Delaware Valley. As a federal savings bank, which was formerly chartered as a state mutual savings bank, the Bank enjoys broader fiduciary powers than most other types of financial institutions. A fixture in the community, the Bank has been in operation for more than 185 years. In addition to its focus on stellar customer service, the Bank has continued to fuel growth and remains a leader in our community. We are a relationship-focused, locally-managed, community banking institution. We state our mission simply: “We Stand for Service.” Our strategy of “Engaged Associates delivering Stellar Experiences growing Customer Advocates and value for our Owners” focuses on exceeding customer expectations, delivering stellar experiences and building customer advocacy through highly-trained, relationship-oriented, friendly, knowledgeable and empowered Associates.

The Company has four consolidated subsidiaries, WSFS Bank, Cypress Capital Management, LLC (Cypress), WSFS Capital Management, LLC (West Capital) and WSFS Wealth Management, LLC (Powdermill) as well as one unconsolidated subsidiary, WSFS Capital Trust III (the Capital Trust). WSFS Bank has three wholly-owned subsidiaries, WSFS Wealth Investments, 1832 Holdings, Inc. and Monarch Entity Services LLC (Monarch).

Our core banking business is commercial lending funded by customer-generated deposits. We have built a $3.85 billion commercial loan portfolio by recruiting the best seasoned commercial lenders in our markets and offering the high level of service and flexibility typically associated with a community bank. We fund this business primarily with deposits generated through commercial relationships and retail deposits. As of March 31, 2017 , we service our customers primarily from our 77 offices located in Delaware (46), Pennsylvania (29), Virginia (1) and Nevada (1) and through our website at www.wsfsbank.com. We also offer a broad variety of consumer loan products, retail securities and insurance brokerage through our retail branches, and mortgage and title services through those branches and through Pennsylvania-based WSFS Mortgage. WSFS Mortgage is a mortgage banking company specializing in a variety of residential mortgage and refinancing solutions.

The Cash Connect^® segment is a premier provider of ATM vault cash and smart safe and cash logistics in the U.S. It manages over $1.02 billion in total cash and services in over 21,000 non-bank ATMs nationwide and over 970 smart safes nationwide. Cash Connect^® provides related services such as online reporting and ATM cash management, predictive cash ordering, armored carrier management, ATM processing equipment sales and deposit safe cash logistics. Cash Connect^® also operates over 440 ATMs for the Bank, which has the largest branded ATM network in Delaware.

As a provider of ATM vault cash to the U.S. ATM industry, Cash Connect^® is exposed to substantial operational risk, including theft of cash from ATMs, armored vehicles, or armored carrier terminals, as well as general risk of accounting errors or fraud. This risk is managed through a series of financial controls, automated tracking and settlement systems, contracts, and other risk mitigation strategies, including both loss prevention and loss recovery strategies. Throughout its 17-year history, Cash Connect^® periodically has been exposed to losses through theft from armored courier companies and consistently has been able to recover losses through its risk management strategies.

The Wealth Management segment provides a broad array of fiduciary, investment management, credit and deposit products to clients through six businesses. WSFS Wealth Investments, with $169.8 million in assets under management (AUM), provides insurance and brokerage products primarily to our retail banking clients in assets under management. Cypress is a registered investment adviser with approximately $774.3 million in assets under management. Cypress is a fee-only wealth management firm offering a “balanced” investment style focused on preservation of capital and providing current income whose primary market segment is high net worth individuals. West Capital is a registered investment adviser with approximately $779.5 million in assets under management. West Capital is a fee-only wealth management firm which operates under a multi-family office philosophy and provides fully customized solutions tailored to the unique needs of institutions and high net worth individuals. Christiana Trust, with $15.85 billion in assets under management and administration, provides fiduciary and investment services to personal trust clients; and trustee, agency, bankruptcy administration, custodial and commercial domicile services to corporate and institutional clients. Powdermill Financial Solutions, LLC is a multi-family office that specializes in providing unique, independent solutions to high net worth individuals, families and corporate executives. WSFS Private Banking serves high net worth clients by delivering credit and deposit products and partnering with other business units to deliver investment management and fiduciary products and services.

46

As a provider of trust services to our clients, we are exposed to operational, reputation-related and legal risks due to the inherent complexity of the trust business. To mitigate these risks, we rely on the hiring, development and retention of experienced Associates, financial controls, managerial oversight, and other risk management practices. Also, from time to time our trust business may give rise to disputes with clients and we may be exposed to litigation which could result in significant costs. The ultimate outcome of any litigation is uncertain.

FINANCIAL CONDITION, CAPITAL RESOURCES AND LIQUIDITY

Financial Condition

Our total assets increased $87.6 million, or 1%, to $6.85 billion during the three months endedMarch 31, 2017. Net loans increased $107.8 million, or 2%, primarily due to organic growth in our loan portfolio. Cash and cash equivalents increased $33.3 million, or 4%, primarily due to higher cash in non-owned ATMs reflecting the continued growth of our Cash Connect^® segment. Partially offsetting these increases, loans held for sale decreased $25.4 million, or 46% consistent with our strategy to sell most newly originated residential mortgages in the secondary market. Stock in the Federal Home Loan Bank of Pittsburgh (FHLB) decreased $18.2 million, or 48%, due to a large short-term deposit from a trust relationship that resulted in a reduction in FHLB advances at March 31, 2017.

Total liabilities increased $71.0 million, or 1.2%, to $6.15 billion during the three months endedMarch 31, 2017. Deposits increased $638.4 million, or 13%, due to the aforementioned short-term trust deposit of $352.4 million that was received late in the first quarter of 2017, as well as strong organic growth. FHLB advances, used to fund growth in our balance sheet assets, decreased $556.1 million, or 65%, due to the increase in deposits.

Capital Resources

Senior Debt:

During the second quarter of 2016, WSFS issued $100.0 million in aggregate principal amount of 4.50% fixed-to-floating rate senior notes due on June 15, 2026. The Company is using the net proceeds from the offering for general corporate purposes.

In 2012, we issued and sold $55.0 million in aggregate principal amount of 6.25% senior notes due 2019 (the “2012 senior debt”). The 2012 senior debt is unsecured and ranks equally with all of our other present and future unsecured unsubordinated obligations. The 2012 senior debt is effectively subordinated to our secured indebtedness and structurally subordinated to the indebtedness of our subsidiaries. At our option, the 2012 senior debt is callable, in whole or in part, on September 1, 2017, or on any scheduled interest payment date thereafter, at a price equal to the outstanding principal amount to be redeemed plus accrued and unpaid interest. The 2012 senior debt matures on September 1, 2019.

In the first quarter of 2017, WSFS repurchased 62,000 shares of common stock at an average price of $45.41 as part of our 5% buyback program approved by the Board of Directors during the fourth quarter of 2015. WSFS has 892,194 shares, or nearly 3% of outstanding shares, remaining to repurchase under this authorization.

Stockholders’ equity increased $16.7 million between December 31, 2016 and March 31, 2017. This increase was primarily due to net income for the three months endedMarch 31, 2017 of $18.9 million, partially offset by the payment of common stock dividends and stock buybacks during the quarter.

47

Below is a table comparing the Bank and the Company’s consolidated capital position to the minimum regulatory requirements as of March 31, 2017:

	Consolidated Capital				For Capital Adequacy Purposes				To be Well-Capitalized Under Prompt Corrective Action Provisions
(Dollars in thousands)	Amount		Percent		Amount		Percent		Amount		Percent
Total Capital (to Risk-Weighted Assets)
Wilmington Savings Fund Society, FSB	$	679,256	11.97	%	$	454,012	8.00	%	$	567,516	10.00	%
WSFS Financial Corporation	637,344		11.21	%	455,025		8.00	%	568,781		10.00	%
Tier 1 Capital (to Risk-Weighted Assets)
Wilmington Savings Fund Society, FSB	638,377		11.25	%	340,509		6.00	%	454,012		8.00	%
WSFS Financial Corporation	596,465		10.49	%	341,269		6.00	%	455,025		8.00	%
Common Equity Tier 1 Capital (to Risk-Weighted Assets)
Wilmington Savings Fund Society, FSB	638,377		11.25	%	255,382		4.50	%	368,885		6.50	%
WSFS Financial Corporation	531,528		9.35	%	255,952		4.50	%	369,708		6.50	%
Tier 1 Leverage Capital
Wilmington Savings Fund Society, FSB	638,377		9.60	%	265,948		4.00	%	332,436		5.00	%
WSFS Financial Corporation	596,465		8.94	%	266,836		4.00	%	333,544		5.00	%

Book value per share of common stock was $22.38 at March 31, 2017, an increase of $0.48, or 2% from $21.90 at December 31, 2016. Tangible common book value per share of common stock (a non-GAAP financial measure) was $16.33 at March 31, 2017, an increase of $0.53, or 3%, from $15.80 at December 31, 2016. For a reconciliation of tangible common book value per share to book value per share in accordance with GAAP, see Reconciliation of Non-GAAP Measure to GAAP.

Regulators have established five capital tiers: well-capitalized, adequately-capitalized, under-capitalized, significantly under-capitalized, and critically under-capitalized. A depository institution’s capital tier depends on its capital levels in relation to various relevant capital measures, which include leveraged and risk-based capital measures and certain other factors. Depository institutions that are not classified as well-capitalized are subject to various restrictions regarding capital distributions, payment of management fees, acceptance of brokered deposits and other operating activities.

Regulatory capital requirements for the Bank and the Company include a minimum common equity Tier 1 capital ratio of 4.50% of risk-weighted assets, a Tier 1 capital ratio of 6.00% of risk-weighted assets, a minimum Total capital ratio of 8.00% of risk-weighted assets and a minimum Tier 1 leverage capital ratio of 4.00% of average assets.

Not included in the Bank’s capital, the Company separately held $97.1 million in cash to support share repurchases, potential dividends, acquisitions, strategic growth plans and other general corporate purposes.

As shown in the table above, as of March 31, 2017, the Bank and the Company were in compliance with regulatory capital requirements and exceeded the amounts required to be considered “well capitalized” as defined in the regulations.

Liquidity

We manage our liquidity and funding needs through our Treasury function and our Asset/Liability Committee. We have a policy that separately addresses liquidity, and management monitors our adherence to policy limits. Also, liquidity risk management is a primary area of examination by the banking regulators.

We have ready access to several funding sources to fund growth and meet our liquidity needs. Among these are net income, retail deposit programs, loan repayments, FHLB borrowings, repurchase agreements, access to the Federal Discount Window, and access to the brokered deposit market as well as other wholesale funding avenues. In addition, we have a large portfolio of high-quality, liquid investments, primarily short-duration mortgage-backed securities and government sponsored enterprises notes, that provide a near-continuous source of cash flow to meet current cash needs, or can be sold to meet larger discrete needs for cash. We believe these sources are sufficient to maintain required and prudent levels of liquidity.

48

During the three months ended March 31, 2017, cash and cash equivalents increased $33.3 million to $855.3 million from $821.9 million as of December 31, 2016. Cash provided by operating activities was $48.2 million, reflecting the cash impact from earnings and sale of loans held for sale during the three months ended March 31, 2017. Cash used by investing activities was $82.6 million, primarily due to increased lending of $106.9 million, partially offset by net cash received from redemption of FHLB stock of $18.2 million. Cash provided by financing activities was $67.7 million, primarily from increases in cash of $623.2 million from net increases in deposit balances, offset by net cash repayment of $556.1 million in FHLB advances.

NONPERFORMING ASSETS

Nonperforming assets (NPAs) include nonaccruing loans, nonperforming real estate, other real estate owned and restructured commercial, mortgage and home equity consumer debt. Nonaccruing loans are those on which the accrual of interest has ceased. Loans are placed on nonaccrual status immediately if, in the opinion of management, collection is doubtful, or when principal or interest is past due 90 days or more and the value of the collateral is insufficient to cover principal and interest. Interest accrued but not collected at the date a loan is placed on nonaccrual status is reversed and charged against interest income. In addition, the amortization of net deferred loan fees is suspended when a loan is placed on nonaccrual status. Subsequent cash receipts are applied either to the outstanding principal balance or recorded as interest income, depending on management’s assessment of the ultimate collectability of principal and interest. Past due loans are defined as loans contractually past due 90 days or more as to principal or interest payments but which remain in accrual status because they are considered well secured and in the process of collection.

The following table shows our nonperforming assets and past due loans at the dates indicated:

(Dollars in thousands)	March 31, 2017			December 31, 2016
Nonaccruing loans:
Commercial	$	16,520		$	2,015
Owner-occupied commercial	4,020			2,078
Consumer	4,486			3,995
Commercial mortgages	9,695			9,821
Residential mortgages	4,957			4,967
Construction	—			—
Total nonaccruing loans	39,678			22,876
Other real estate owned	3,582			3,591
Restructured loans (1)	17,260			14,336
Total nonperforming assets	$	60,520		$	40,803
Past due loans: (1)
Residential mortgages	$	850		$	153
Consumer	106			285
Commercial and commercial mortgages	809			—
Total past due loans	$	1,765		$	438
Ratio of allowance for loan losses to total gross loans (2)	0.87		%	0.89		%
Ratio of nonaccruing loans to total gross loans (2)	0.87			0.51
Ratio of nonperforming assets to total assets	0.88			0.60
Ratio of loan loss allowance to nonaccruing loans	100.37			173.77
Ratio of loan loss allowance to total nonperforming assets	0.66			0.97

⁽¹⁾  Accruing loans only, which includes acquired nonimpaired loans. Nonaccruing TDRs are included in their respective categories of nonaccruing loans.

⁽²⁾  Total loans exclude loans held for sale and reverse mortgages.

49

Nonperforming assets increased $19.7 million between December 31, 2016 and March 31, 2017. The increase was primarily due to one $9.7 million locally-based, C&I participation that was downgraded during the quarter after a targeted energy sector review at the agent bank. The loan relationship is current and resolution is expected in the near term with no impact to net chargeoffs. The remaining increase in nonperforming assets was primarily due to three smaller C&I relationships (ranging from $1.7 to $3.5 million) that were moved to nonaccruing status during the quarter. These relationships were from unrelated industries that had specific events that caused weakness in the underlying business. In each case, a comprehensive impairment analysis was completed and the results were included in the provision for loan losses for the three months endedMarch 31, 2017.

The ratio of nonperforming assets to total assets increased to 0.88% at March 31, 2017 from 0.60% at December 31, 2016. TDRs (accruing) increased during the three months ended March 31, 2017 by $2.9 million mainly due to the addition of one construction portfolio relationship of $1.7 million. Other Real Estate Owned (OREO) properties declined slightly due to the sale of seven properties totaling $1.7 million and offset by one new property at $1.6 million.

The following table summarizes the changes in nonperforming assets during the periods indicated:

	Three months ended			Three months ended
(Dollars in thousands)	March 31, 2017			March 31, 2016
Beginning balance	$	40,803		$	39,892
Additions	25,849			2,473
Collections	(2,824		)	(3,940		)
Transfers to accrual	(891		)	—
Charge-offs, net	(2,417		)	(746		)
Ending balance	$	60,520		$	37,679

The timely identification of problem loans is a key element in our strategy to manage our loan portfolio. Problem loans are all criticized, classified and nonperforming loans and other real estate owned. Timely identification enables us to take appropriate action and, accordingly, minimize losses. An asset review system established to monitor the asset quality of our loans and investments in real estate portfolios facilitates the identification of problem assets. In general, this system utilizes guidelines established by federal regulation.

INTEREST RATE SENSITIVITY

The matching of maturities or repricing periods of interest rate-sensitive assets and liabilities to promote a favorable interest rate spread and mitigate exposure to fluctuations in interest rates is our primary tool for achieving our asset/liability management strategies. We regularly review our interest rate sensitivity and adjust the sensitivity within acceptable tolerance ranges. At March 31, 2017, interest-earning assets exceeded interest-bearing liabilities that mature or reprice within one year (interest-sensitive gap) by $78.9 million. Our interest-sensitive assets as a percentage of interest-sensitive liabilities within the one-year window increased from 91.3% at December 31, 2016 to 102.6% at March 31, 2017. Likewise, the one-year interest-sensitive gap as a percentage of total assets increased to 1.15% at March 31, 2017 from (4.41%) at December 31, 2016. The low rate level of sensitivity reflects our continuing efforts to effectively manage interest rate risk.

Market risk is the risk of loss from adverse changes in market prices and rates. Our market risk arises primarily from interest rate risk inherent in our lending, investing, and funding activities. To that end, we actively monitor and manage our interest rate risk exposure. One measure, which we are required to perform by federal regulation, measures the impact of an immediate change in interest rates in 100 basis point increments on the economic value of equity ratio. The economic value of the equity ratio is defined as the economic value of the estimated cash flows from assets and liabilities as a percentage of economic value of cash flows from total assets.

50

The following table shows the estimated impact of immediate changes in interest rates on our net interest margin and economic value of equity ratio at the specified levels at March 31, 2017 and December 31, 2016:

March 31, 2017			December 31, 2016
% Change in Interest Rate (Basis Points)	% Change in Net Interest Margin (1)	Economic Value of Equity (2)	% Change in Net Interest Margin (1)	Economic Value of Equity(2)
+300	9%	14.84%	3%	14.04%
+200	6%	14.88%	2%	14.09%
+100	3%	14.78%	<1%	14.00%
—	—%	14.56%	—%	13.80%
-100	(3)%	13.84%	<1%	13.08%
-200 (3)	NMF	NMF	NMF	NMF
-300 (3)	NMF	NMF	NMF	NMF

⁽¹⁾   The percentage difference between net interest margin in a stable interest rate environment and net interest margin as projected under the various rate change environments.

⁽²⁾  The economic value of equity ratio of the Company in a stable interest rate environment and the economic value of equity ratio as projected under the various rate change environments.

⁽³⁾  Sensitivity indicated by a decrease of 200 or 300 basis points is not deemed meaningful (NMF) given the low absolute level of interest rates at that time.

We also engage in other business activities that are sensitive to changes in interest rates. For example, mortgage banking revenues and expenses can fluctuate with changing interest rates. These fluctuations are difficult to model and estimate.

RESULTS OF OPERATIONS

We recorded net income of $18.9 million, or $0.59 per diluted common share, for the three months endedMarch 31, 2017, a $3.2 million, or 20% increase from $15.8 million, or $0.52 per share, for the three months endedMarch 31, 2016. Net interest income for the three months endedMarch 31, 2017 was $53.1 million, an increase of $7.7 million compared to the three months endedMarch 31, 2016, reflecting continued strong organic and acquisition-related growth in our loan portfolio, partially offset by higher interest expense related to deposit growth, FHLB advances and our issuance of senior unsecured notes in the second quarter of 2016. Noninterest income increased $4.4 million, primarily due to increased investment management and fiduciary revenue and growth in credit/debit card and ATM income - see “Noninterest (Fee) Income” for further information. Partially offsetting these increases was a $7.7 million increase in noninterest expenses, primarily reflecting our higher employee-related and ongoing operating costs to support our significant organic and acquisition growth - see “Noninterest Expense” for further information.

Our noninterest expenses are driven by our high-touch, high-service model. This combined with our significant and diverse fee income mix results in a first quarter 2017 efficiency ratio of 62.9% compared to 62.8% for the first quarter of 2016. Typically our first quarter efficiency ratio is impacted by both seasonal increases in our operating costs and a seasonal decrease in our fee income mix. Operating costs are primarily higher in the first quarter due to the seasonality associated with compensation and related costs, specifically related to taxes, 401(k) matching costs, incentive payments, annual merit increases and the reset of tax caps. Our fee income mix was primarily lower due to the typical first-quarter seasonality associated with our wealth management, Cash Connect^® and mortgage banking businesses, in addition to the lower day count and impact across all segments.

Management believes its operating costs are at an appropriate level and scale for the Company’s size and products and services as our fee -based businesses typically carry a higher efficiency ratio as they derive revenue based on human capital versus assets. Management continues to optimize and review its operations in order to limit increases or reduce costs over the remainder of the year. Consistent with previous years, the Company expects gradual improvement of its efficiency ratio throughout the year, from the first quarter result of 62.9% trending towards a fourth quarter ratio in the high 50%s, and ultimately expects to achieve its goal of a relatively flat efficiency ratio for the full year 2017 as compared to full year 2016. The relatively flat efficiency ratio and core operating leverage year-over-year is due to continued reinvestment in our balance sheet and capabilities to support our organic and acquisition growth, as well as increased contributions from our fee-based businesses.

51

Net Interest Income

The following tables provide information concerning the balances, yields and rates on interest-earning assets and interest-bearing liabilities during the periods indicated:

	Three months ended March 31,
	2017							2016
(Dollars in thousands)	Average Balance			Interest		Yield/ Rate (1)		Average Balance			Interest		Yield/ Rate (1)
Assets:
Interest-earning assets:
Loans: (2)
Commercial real estate loans	$	1,392,925		$	17,023	4.96	%	$	1,192,711		$	14,280	4.82	%
Residential real estate loans	281,953			4,981		7.07		281,501			3,909		5.55
Commercial loans	2,391,817			26,897		4.59		1,968,278			21,965		4.53
Consumer loans	457,373			5,408		4.80		361,040			4,093		4.56
Loans held for sale	41,092			372		3.62		32,891			315		3.83
Total loans	4,565,160			54,681		4.87		3,836,421			44,562		4.69
Mortgage-backed securities (3)	759,159			4,395		2.32		711,352			3,894		2.19
Investment securities (3)	228,841			1,249		3.17		203,665			1,220		3.54
Other interest-earning assets	42,910			501		4.67		30,558			370		4.87
Total interest-earning assets	5,596,070			60,826		4.46		4,781,996			50,046		4.27	%
Allowance for loan losses	(40,556		)					(37,544		)
Cash and due from banks	145,712							93,998
Cash in non-owned ATMs	683,138							452,052
Bank-owned life insurance	101,522							90,290
Other noninterest-earning assets	348,582							215,201
Total assets	$	6,834,468						$	5,595,993
Liabilities and Stockholders’ Equity:
Interest-bearing liabilities:
Interest-bearing deposits:
Interest-bearing demand	$	919,456		$	385	0.17	%	$	766,209		$	245	0.13	%
Money market	1,323,969			1,026		0.31		1,098,595			749		0.27
Savings	574,252			213		0.15		443,822			139		0.13
Customer time deposits	581,547			1,090		0.76		574,422			745		0.52
Total interest-bearing customer deposits	3,399,224			2,714		0.32		2,883,048			1,878		0.26
Brokered certificates of deposit	175,789			361		0.83		166,974			241		0.58
Total interest-bearing deposits	3,575,013			3,075		0.35		3,050,022			2,119		0.28
FHLB of Pittsburgh advances	866,780			1,858		0.87		674,247			1,048		0.63
Trust preferred borrowings	67,011			446		2.70		67,011			371		2.23
Senior debt	152,103			2,121		5.58		53,741			942		7.01
Other borrowed funds (4)	142,292			223		0.64		155,011			210		0.54
Total interest-bearing liabilities	4,803,199			7,723		0.65	%	4,000,032			4,690		0.47	%
Noninterest-bearing demand deposits	1,255,950							949,607
Other noninterest-bearing liabilities	76,845							54,307
Stockholders’ equity	698,474							592,047
Total liabilities and stockholders’ equity	$	6,834,468						$	5,595,993
Excess of interest-earning assets over interest-bearing liabilities	$	792,871						$	781,964
Net interest and dividend income				$	53,103						$	45,356
Interest rate spread						3.81	%						3.80	%
Net interest margin						3.90	%						3.87	%

⁽¹⁾  Weighted average yields have been computed on a tax-equivalent basis using a 35% effective tax rate.

⁽²⁾  Average balances include nonperforming loans and net of unearned income.

⁽³⁾  Includes securities available for sale at fair value.

⁽⁴⁾  Includes federal funds purchased and securities sold under agreement to repurchase.

52

During the three months endedMarch 31, 2017, net interest income increased $7.7 million, or 17% from the three months endedMarch 31, 2016, and the net interest margin was 3.90%, a 3 basis point increase compared to 3.87% for the first quarter of 2016. These year-over-year increases in margin dollars and percentages reflect the positive impact of our combination with Penn Liberty, offset somewhat by higher funding costs to support the increase in Cash Connect's^® fee-based bailment business.

Provision/Allowance for Loan Losses

We maintain an allowance for loan losses at an appropriate level based on our assessment of estimable and probable losses in the loan portfolio. Our evaluation is based on a review of the portfolio and requires significant, complex and difficult judgments. For the three months endedMarch 31, 2017 and 2016, we recorded a provision for loan losses of $2.2 million and $0.8 million, respectively.

Our allowance for loan losses is based on the inherent risk of our loans and various other factors including but not limited to, collateral values, trends in asset quality, level of delinquent loans and concentrations. In addition, regional economic conditions are taken into consideration. The allowance for loan losses was $39.8 million at both March 31, 2017 and December 31, 2016. The allowance for loan losses and provision reflect the following; total net loans increased $107.8 million at March 31, 2017 when compared to December 31, 2016, loan downgrades and the addition of reserves were offset by payoff activity and improvement in qualitative adjustment factors due to continued improvement of economic conditions. The ratio of allowance for loan losses to total gross loans was 0.87% at March 31, 2017 and 0.89% at December 31, 2016. This ratio excluding the impact of all purchased loans would have been 1.04% at March 31, 2017. 

The table below represents a summary of changes in the allowance for loan losses for the three months endedMarch 31, 2017 and 2016, respectively.

	Three months ended March 31,
(Dollars in thousands)	2017			2016
Beginning balance	$	39,751		$	37,089
Provision for loan losses	2,162			780
Charge-offs:
Commercial	1,255			179
Owner-occupied commercial	192			—
Commercial real estate	104			17
Construction	14			26
Residential real estate	11			14
Consumer	926			488
Overdrafts	217			143
Total charge-offs	2,719			867
Recoveries:
Commercial	84			110
Owner-occupied commercial	75			38
Commercial real estate	46			79
Construction	2			46
Residential real estate	120			22
Consumer	232			172
Overdrafts	73			87
Total recoveries	632			554
Net charge-offs	2,087			313
Ending balance	$	39,826		$	37,556
Net charge-offs to average gross loans outstanding, net of unearned income (1)	0.19		%	0.03		%
(1) Ratios for the three months ended March 31, 2017 and 2016 are annualized

53

Noninterest (Fee) Income

During the first quarter of 2017, the Company earned fee income of $28.1 million, an increase of $4.4 million, or 19% , compared to $23.7 million in the first quarter of 2016. This increase is primarily due to an increase of $2.8 million in investment management and fiduciary income due to growth in several business lines and an increase of $1.2 million in credit/debit card and ATM income reflecting growth due to expanded revenue sources representing strong growth in our Wealth Management and Cash Connect^® businesses.

Noninterest Expense

Noninterest expense for the first quarter of 2017 was $51.5 million, an increase of $7.7 million, or 18%, from $43.8 million in the first quarter of 2016. Contributing to the year-over-year increase was $4.8 million of ongoing operating costs from our combinations with Penn Liberty, Powdermill and West Capital. The remaining increase reflects higher compensation and related costs due to added staff and infrastructure costs to support overall franchise growth.

Income Taxes

We and our subsidiaries file a consolidated federal income tax return and separate state income tax returns. Income taxes are accounted for in accordance with ASC 740, which requires the recording of deferred income taxes for tax consequences of temporary differences. We recorded an income tax expense of $8.6 million during the three months endedMarch 31, 2017, respectively, compared to an income tax expense of $8.7 million for the same period in 2016.

Our effective tax rate was 31.2% for the three months endedMarch 31, 2017 compared to 35.5% during the same period in 2016. The effective tax rate in 1Q 2017 decreased due to the tax benefit related to stock-based compensation activity during the quarter due to both the adoption of ASU No. 2016-09, Improvements to Employee Share-Based Payment Accounting, Compensation – Stock Compensation (Topic 718) during the second quarter of 2016, as well as higher tax benefits realized on stock-based compensation activity during the three months endedMarch 31, 2017, due to greater transaction volume and increases in the Company’s stock price. The tax benefit recognized during the three months endedMarch 31, 2017 was $1.3 million, whereas no benefit was recognized in first quarter of 2016.

The effective tax rate reflects the recognition of certain tax benefits in the financial statements including those benefits from tax-exempt interest income, federal low-income housing tax credits, excess tax benefits from recognized stock compensation, and BOLI income. These tax benefits are offset by the tax effect of stock-based compensation expense related to incentive stock options, nondeductible acquisition costs and a provision for state income tax expense.

We frequently analyze our projections of taxable income and make adjustments to our provision for income taxes accordingly.

Contractual Obligations

Our contractual obligations at March 31, 2017 did not significantly change from our contractual obligations at December 31, 2016 , which are disclosed in our 2016 Annual Report on Form 10-K, except for data processing obligations, the impact of which is shown in the table below.

(Dollars in thousands)	Total at March 31, 2017		Remainder of 2017		2018-2019		2020-2021		2022 and Beyond
Data processing obligations	$	15,437	$	5,226	$	8,082	$	1,801	$	328

54

RECONCILIATION OF NON-GAAP MEASURE TO GAAP MEASURE

The following table provides a reconciliation of tangible common book value per share of common stock to book value per share of common stock, the most directly comparable GAAP financial measure. We believe this measure is important to management and investors to better understand and assess changes from period to period in stockholders’ equity exclusive of changes in intangible assets.

(Dollars and share amounts in thousands, except per share amounts)	March 31, 2017		December 31, 2016
Stockholders’ equity	$	704,001	$	687,336
Goodwill and other intangible assets	190,372		191,247
Tangible common equity (numerator)	$	513,629	$	496,089
Shares of common stock outstanding (denominator)	31,458		31,390
Book value per share of common stock	$	22.38	$	21.90
Goodwill and other intangible assets	6.05		6.10
Tangible book value per share of common stock	$	16.33	$	15.80

CRITICAL ACCOUNTING ESTIMATES

The preparation of the unaudited Consolidated Financial Statements in accordance with U.S. GAAP requires us to make estimates and assumptions affecting the reported amounts of assets, liabilities, revenue and expenses. We regularly evaluate these estimates and assumptions including those used to determine the allowance for loan losses, deferred taxes, fair value measurements, goodwill and other intangible assets. We base our estimates on historical experience and various other factors and assumptions that are believed to be reasonable under the circumstances. These form the basis for making judgments on the carrying value of assets and liabilities that are not readily apparent from other sources. Although our current estimates contemplate current economic conditions and how we expect them to change in the future, for the remainder of 2017, it is possible that actual conditions may be worse than anticipated in those estimates, which could materially affect our results of operations and financial condition. Actual results may differ from these estimates under different assumptions or conditions.

For further discussion of our critical accounting estimates, see the "Management's Discussion and Analysis - Critical Accounting Estimates" section of our Annual Report on Form 10-K for the year ended December 31, 2016.

RECENT LEGISLATION

General

As a federally chartered savings institution the Bank is subject to regulation by the FHFA, an independent agency in the executive branch of the U.S. government, the FDIC, the Board of Governors of the Federal Reserve System (Federal Reserve) and the Office of the Comptroller of the Currency (OCC), collectively referred to as the Federal banking agencies. The lending activities and other investments of the Bank must comply with various federal regulatory requirements. The OCC periodically examines the Bank for compliance with regulatory requirements. The FDIC also has the authority to conduct special examinations of the Bank. The Bank is required to file periodic reports with the OCC describing its activities and financial condition. The Bank is also subject to certain reserve requirements promulgated by the FHFA and the Federal Reserve.

55

Basel III

In 2013, the Federal banking agencies approved the final rules implementing the Basel Committee on Banking Supervision (BCBS) capital guidelines for U.S. banking organizations. Under the final rules as of January 2015, minimum requirements increased for both the quantity and quality of capital maintained by the Company and the Bank. The rules included a new common equity Tier 1 capital to risk-weighted assets minimum ratio of 4.5%, raised the minimum ratio of Tier 1 capital to risk-weighted assets from 4.0% to 6.0%, required a minimum ratio of total capital to risk-weighted assets of 8.0%, and required a minimum Tier 1 leverage ratio of 4.0%. The final rule also established a new capital conservation buffer, comprised of common equity Tier 1 capital, above the regulatory minimum capital requirements. The phase-in of the capital conservation buffer began on January 1, 2016 at 0.625% of risk-weighted assets and will increase each subsequent year by an additional 0.625% until reaching its final level of 2.5% on January 1, 2019. For 2017, the capital conservation buffer is 1.25%. The final rules also revised the standards for an insured depository institution to be “well-capitalized” under the banking agencies’ prompt corrective action framework, requiring a common equity Tier 1 capital ratio of 6.5%, Tier 1 capital ratio of 8.0% and total capital ratio of 10.0%, while leaving unchanged the existing 5.0% leverage ratio requirement. Strict eligibility criteria for regulatory capital instruments were also implemented under the final rules. Newly issued trust preferred securities and cumulative perpetual preferred stock may no longer be included in Tier 1 capital. However, for depository institution holding companies of less than $15 billion in total consolidated assets, such as the Company, most outstanding trust preferred securities and other non-qualifying securities issued prior to May 19, 2010 are permanently grandfathered to be included in Tier 1 capital (up to a limit of 25% of Tier 1 capital, excluding non-qualifying capital instruments). As of March 31, 2017, we had approximately $67.0 million of trust preferred securities outstanding, all of which are counted as Tier 1 capital.

The phase-in period for the final rules began for us on January 1, 2015. Full compliance with all of the final rule’s requirements phased in over a multi-year schedule is required by January 1, 2019. As of March 31, 2017, the Company and the Bank met the applicable standards, and the Bank was “well-capitalized” under the prompt corrective action rules.

In 2014, the Federal banking agencies adopted a “liquidity coverage ratio” requirement (LCR) for large internationally active banking organizations, and in 2016, the agencies proposed a “net stable funding ratio” standard (NSFR) for the same group of institutions. The LCR measures an organizations’ ability to meet liquidity demands over a 30-day horizon; the NSFR would test the same capacity over a one-year horizon. Neither requirement applies directly to the Company or the Bank, but the policies embedded in them may inform the work of the examiners as they consider our liquidity.

Item 3.     Quantitative and Qualitative Disclosures About Market Risk

Incorporated herein by reference from Item 2 Part I (Interest Rate Sensitivity) of this Quarterly Report on Form 10-Q.

Item 4.     Controls and Procedures

(a) Evaluation of disclosure controls and procedures. Based on their evaluation of our disclosure controls and procedures (as defined in Rules 13a-15(e) under the Exchange Act), our principal executive officer and principal financial officer have concluded that as of the end of the period covered by this Quarterly Report on Form 10-Q such disclosure controls and procedures are effective to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.

(b) Changes in internal control over financial reporting. During the quarter ended March 31, 2017, there was no change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

56

Part II. OTHER INFORMATION

Item 1.    Legal Proceedings

Incorporated herein by reference to Note 17 – Legal and Other Proceedings to the Consolidated Financial Statements

Item 1A.    Risk Factors

There have not been any material changes to the risk factors previously disclosed under Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2016, previously filed with the SEC.

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

The following table represents information with respect to repurchases of common stock made by the Company during the three months endedMarch 31, 2017.

2017	Total Number of Shares Purchased	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1)	Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs (1)
January	20,000	$	45.67	20,000	934,194
February	22,000	45.16		22,000	912,194
March	20,000	45.42		20,000	892,194
Total	62,000	$	45.41	62,000

⁽¹⁾  During the fourth quarter of 2015, the Board of Directors approved a stock buyback program of up to 5% of then-outstanding shares of common stock. Under the program, purchases may be made from time to time in the open market or through negotiated transactions, subject to market conditions and other factors, and in accordance with applicable securities laws. There is no fixed termination date for the repurchase program, and the repurchase program may be suspended or discontinued at any time.

57

Item 3.    Defaults upon Senior Securities

Not applicable

Item 4.    Mine Safety Disclosures

Not applicable

Item 5.    Other Information

Not applicable

Item 6. Exhibits

(a) Exhibit 31.1 – Certification of CEO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

(b) Exhibit 31.2 – Certification of CFO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

(c) Exhibit 32 – Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

(d) Exhibit 101.INS – XBRL Instance Document

(e) Exhibit 101.SCH – XBRL Schema Document

(f) Exhibit 101.CAL – XBRL Calculation Linkbase Document

(g) Exhibit 101.LAB – XBRL Labels Linkbase Document

(h) Exhibit 101.PRE – XBRL Presentation Linkbase Document

(i) Exhibit 101.DEF – XBRL Definition Linkbase Document

58

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.

	WSFS FINANCIAL CORPORATION
Date: May 9, 2017	/s/ Mark A. Turner
	Mark A. Turner
	President and Chief Executive Officer
	(Principal Executive Officer)
Date: May 9, 2017	/s/ Dominic C. Canuso
	Dominic C. Canuso
	Executive Vice President and
	Chief Financial Officer
	(Principal Financial and Accounting Officer)

59

EX-31.1

Exhibit 31.1

I, Mark A. Turner, certify that:

1. I have reviewed this quarterly report on Form 10-Q of WSFS Financial Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15-(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

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

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

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

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

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	May 9, 2017	/s/ Mark A. Turner
		Mark A. Turner
		President and Chief Executive Officer
		(Principal Executive Officer)

EX-31.2

Exhibit 31.2

I, Dominic C. Canuso, certify that:

1. I have reviewed this quarterly report on Form 10-Q of WSFS Financial Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15-(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

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

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

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

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

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	May 9, 2017	/s/ Dominic C. Canuso
		Dominic C. Canuso
		Executive Vice President and Chief Financial Officer
		(Principal Financial and Accounting Officer)

EX-32

Exhibit 32

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 WSFS Financial Corporation (the Company) for the quarter ended March 31, 2017 as filed with the Securities and Exchange Commission on the date hereof (the Report), we, Mark A. Turner, President and Chief Executive Officer, and Dominic C. Canuso, Executive Vice President and Chief Financial Officer (Principal Accounting Officer), hereby certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that to our knowledge:

1. The Report fully complies with the requirements of Section 13(a) 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/ Mark A. Turner	/s/ Dominic C. Canuso
Mark A. Turner	Dominic C. Canuso
President and Chief Executive Officer	Executive Vice President and
(Principal Executive Officer)	Chief Financial Officer
	(Principal Financial and Accounting Officer)

Date: May 9, 2017

XML

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2017	May 05, 2017
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2017
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	Q1
Trading Symbol	WSFS
Entity Registrant Name	WSFS FINANCIAL CORP
Entity Central Index Key	0000828944
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding (in shares)		31,452,055

XML

Consolidated Statements of Income - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Interest income:
Interest and fees on loans	$ 54,681	$ 44,562
Interest on mortgage-backed securities	4,395	3,894
Interest and dividends on investment securities:
Taxable	117	77
Tax-exempt	1,132	1,143
Other interest income	501	370
Total interest income	60,826	50,046
Interest expense:
Interest on deposits	3,075	2,118
Interest on senior debt	2,121	942
Interest on Federal Home Loan Bank advances	1,858	1,048
Interest on federal funds purchased and securities sold under agreements to repurchase	201	182
Interest on trust preferred borrowings	446	371
Interest on other borrowings	22	29
Total interest expense	7,723	4,690
Net interest income	53,103	45,356
Provision for loan losses	2,162	780
Net interest income after provision for loan losses	50,941	44,576
Noninterest income:
Credit/debit card and ATM income	8,131	6,901
Investment management and fiduciary income	8,039	5,254
Deposit service charges	4,397	4,276
Mortgage banking activities, net	1,185	1,654
Securities gains, net	320	305
Loan fee income	549	477
Bank owned life insurance income	275	231
Other income	5,196	4,570
Total non interest income	28,092	23,668
Noninterest expense:
Salaries, benefits and other compensation	28,836	22,876
Occupancy expense	5,162	4,270
Equipment expense	3,124	2,473
Professional fees	1,635	2,403
Data processing and operations expenses	1,618	1,542
Marketing expense	624	664
Loan workout and OREO expenses	521	503
FDIC expenses	529	838
Corporate development expense	338	569
Other operating expense	9,119	7,659
Total non interest expenses	51,506	43,797
Income before taxes	27,527	24,447
Income tax provision	8,590	8,677
Net income	$ 18,937	$ 15,770
Earnings per share:
Basic (in dollars per share)	$ 0.60	$ 0.53
Diluted (in dollars per share)	$ 0.59	$ 0.52

XML

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Statement of Comprehensive Income [Abstract]
Net Income	$ 18,937	$ 15,770
Net change in unrealized gains on investment securities available for sale
Net unrealized gains arising during the period, net of tax expense of $779 and $6,479, respectively	1,272	10,572
Less: reclassification adjustment for net gains on sales realized in net income, net of tax expense of $114 and $116, respectively	(206)	(189)
Net change in unrealized gains (losses) on investment securities available-for-sale	1,066	10,383
Net change in securities held to maturity
Amortization of unrealized gain on securities reclassified to held-to-maturity, net of tax expense of $59 and $65, respectively	(101)	(103)
Net change in unfunded pension liability
Change in unfunded pension liability related to unrealized (loss) gain, prior service cost and transition obligation, net of tax (benefit) expense of ($12) and $306, respectively	(23)	478
Net change in cash flow hedge
Net unrealized loss arising during the period, net of tax benefit of ($69) and $0, respectively	(112)	0
Total other comprehensive income	830	10,758
Total comprehensive income	$ 19,767	$ 26,528

XML

Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Statement of Comprehensive Income [Abstract]
Net change in Unrealized (losses) gains, tax (benefit) expense	$ 779	$ 6,479
Reclassification adjustment for gains, tax expense	114	116
Amortization of unrealized gain on securities reclassified to held-to-maturity, tax expense	59	65
Change in unfunded pension liability related to unrealized (loss) gain, prior service cost and transition obligation, tax (benefit) expense	(12)	306
Net change in cash flow hedge, tax expense	$ (69)	$ 0

XML

Consolidated Statements of Financial Condition - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Assets:
Cash and due from banks	$ 120,913	$ 119,929
Cash in non-owned ATMs	730,747	698,454
Interest-bearing deposits in other banks including collateral of $3,380 at March 31, 2017 and December 31, 2016	3,603	3,540
Total cash and cash equivalents	855,263	821,923
Investment securities, available for sale (amortized cost of $800,612 at March 31, 2017 and $807,761 at December 31, 2016)	789,125	794,543
Investment securities, held to maturity-at cost (fair value of $163,241 at March 31, 2017 and $163,232 at December 31, 2016)	163,611	164,346
Loans, held for sale at fair value	29,394	54,782
Loans, net of allowance for loan losses of $39,826 at March 31, 2017 and $39,751 at December 31, 2016	4,552,151	4,444,375
Bank owned life insurance	101,700	101,425
Stock in Federal Home Loan Bank of Pittsburgh-at cost	20,002	38,248
Other real estate owned	3,582	3,591
Accrued interest receivable	16,712	17,027
Premises and equipment	49,194	48,871
Goodwill	165,960	167,539
Intangible assets	24,412	23,708
Other assets	81,793	84,892
Total assets	6,852,899	6,765,270
Deposits:
Noninterest-bearing demand	1,658,111	1,266,306
Interest-bearing demand	932,284	935,333
Money market	1,342,464	1,257,520
Savings	597,186	547,293
Time	321,325	332,624
Jumbo certificates of deposit – customer	248,861	260,560
Total customer deposits	5,100,231	4,599,636
Brokered deposits	276,599	138,802
Total deposits	5,376,830	4,738,438
Federal funds purchased and securities sold under agreements to repurchase	135,000	130,000
Federal Home Loan Bank advances	298,095	854,236
Trust preferred borrowings	67,011	67,011
Senior debt	152,177	152,050
Other borrowed funds	48,566	64,150
Accrued interest payable	2,931	1,151
Other liabilities	68,288	70,898
Total liabilities	6,148,898	6,077,934
Stockholders’ Equity:
Common stock $0.01 par value, 65,000,000 shares authorized; issued 56,125,000 at March 31, 2017 and 55,995,219 at December 31, 2016	581	580
Capital in excess of par value	331,371	329,457
Accumulated other comprehensive loss	(6,787)	(7,617)
Retained earnings	643,816	627,078
Treasury stock at cost, 24,667,145 shares at March 31, 2017 and 24,605,145 shares at December 31, 2016	(264,980)	(262,162)
Total stockholders’ equity	704,001	687,336
Total liabilities and stockholders’ equity	$ 6,852,899	$ 6,765,270

XML

Consolidated Statements of Financial Condition (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Statement of Financial Position [Abstract]
Interest-bearing deposits in banks and other financial institutions, collateral	$ 3,380	$ 3,380
Available-for-sale securities, amortized cost basis	800,612	807,761
Held-to-maturity securities, fair value	163,241	163,232
Allowance for loan losses	$ 39,826	$ 39,751
Common stock, shares authorized (in shares)	65,000,000	65,000,000
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, issued (in shares)	56,125,000	55,995,219
Treasury stock, shares (in shares)	24,667,145	24,605,145

XML

Consolidated Statements of Changes in Stockholders Equity (Uaudited) - USD ($) $ in Thousands	Total	Common Stock	Capital in Excess of Par Value	Accumulated Other Comprehensive Income (Loss)	Retained Earnings	Treasury Stock
Beginning Balance at Dec. 31, 2015	$ 580,471	$ 560	$ 256,435	$ 696	$ 570,630	$ (247,850)
Beginning Balance (in shares) at Dec. 31, 2015		55,945,245
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income	15,770				15,770
Other comprehensive income	10,758			10,758
Cash dividend	(1,783)				(1,783)
Issuance of common stock including proceeds from exercise of common stock options	660	$ 1	659
Issuance of common stock including proceeds from exercise of common stock options (in shares)		61,498
Stock-based compensation expense	699		699
Repurchase of common stock	(8,995)					(8,995)
Ending Balance at Mar. 31, 2016	597,580	$ 561	257,793	11,454	584,617	(256,845)
Ending Balance (in shares) at Mar. 31, 2016		56,006,743
Beginning Balance at Dec. 31, 2016	687,336	$ 580	329,457	(7,617)	627,078	(262,162)
Beginning Balance (in shares) at Dec. 31, 2016		55,995,219
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income	18,937				18,937
Other comprehensive income	830			830
Cash dividend	(2,199)				(2,199)
Issuance of common stock including proceeds from exercise of common stock options	1,094	$ 1	1,093
Issuance of common stock including proceeds from exercise of common stock options (in shares)		129,781
Stock-based compensation expense	821		821
Repurchase of common stock	(2,818)					(2,818)
Ending Balance at Mar. 31, 2017	$ 704,001	$ 581	$ 331,371	$ (6,787)	$ 643,816	$ (264,980)
Ending Balance (in shares) at Mar. 31, 2017		56,125,000

XML

Consolidated Statements of Changes in Stockholders Equity (Uaudited) Consolidated Statements of Financial Condition (Parenthetical) - $ / shares	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Cash dividend (in dollars per share)	$ 0.7	$ 0.6
Common Stock
Repurchase of common stock (in shares)	62,000	301,871

XML

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Operating activities:
Net Income	$ 18,937	$ 15,770
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan losses	2,162	780
Depreciation of premises and equipment, net	2,190	1,903
Amortization of fees and discounts, net	4,742	3,895
Amortization of intangible assets	857	549
Decrease in accrued interest receivable	315	48
Increase in other assets	(1,838)	(3,534)
Origination of loans held for sale	(85,833)	(72,474)
Proceeds from sales of loans held for sale	105,436	77,834
Gain on mortgage banking activities, net	(1,185)	(1,654)
Gain on sale of securities, net	(320)	(305)
Stock-based compensation expense	821	758
Increase in accrued interest payable	1,780	539
Decrease in other liabilities	(1,537)	(7,930)
Loss on sale of other real estate owned and valuation adjustments, net	39	76
Deferred income tax expense	3,190	3,293
Increase in value of bank owned life insurance	(275)	(231)
Increase in capitalized interest, net	(1,316)	(1,193)
Net cash provided by operating activities	48,165	18,124
Investing activities:
Purchases of investment securities held to maturity	0	(3,329)
Repayments of investment securities held to maturity	250	1,335
Maturities and calls of investment securities held to maturity	0	400
Sale of investment securities available for sale	263,015	38,932
Purchases of investment securities available for sale	(375,687)	(91,963)
Repayments of investment securities available for sale	119,313	15,463
Net increase in loans	(106,933)	(30,010)
Redemptions of stock of Federal Home Loan Bank of Pittsburgh	(54,990)	(20,037)
Redemptions of stock of Federal Home Loan Bank of Pittsburgh	73,236	19,845
Sales of other real estate owned	1,707	1,442
Investment in premises and equipment	(2,480)	(1,234)
Net cash used for investing activities	(82,569)	(69,156)
Financing activities:
Net increase in demand and saving deposits	508,429	35,907
Decrease in time deposits	(22,998)	(26,072)
Increase in brokered deposits	137,797	43,353
Decrease in loan payable	(420)	(407)
Receipts from FHLB advances	42,415,835	28,349,212
Repayments of FHLB advances	(42,971,976)	(28,310,900)
Receipts from federal funds purchased and securities sold under agreement to repurchase	6,688,000	8,710,770
Repayments of federal funds purchased and securities sold under agreement to repurchase	(6,683,000)	(8,711,445)
Dividends paid	(2,199)	(1,783)
Issuance of common stock and exercise of common stock options	1,094	241
Purchase of treasury stock	(2,818)	(8,995)
Net cash provided by financing activities	67,744	79,881
Increase in cash and cash equivalents	33,340	28,849
Cash and cash equivalents at beginning of period	821,923	561,179
Cash and cash equivalents at end of period	855,263	590,028
Supplemental Disclosure of Cash Flow Information:
Cash paid for interest during the period	5,943	4,151
Cash (received) paid for income taxes, net	(1,199)	9,554
Loans transferred to other real estate owned	1,737	417
Loans transferred to portfolio from held-for-sale at fair value	6,470	1,510
Net change in accumulated other comprehensive income	830	10,758
Non-cash goodwill adjustments, net	$ (1,579)	$ (358)

XML

Basis of Presentation

3 Months Ended

Mar. 31, 2017

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

BASIS OF PRESENTATION

General

Our unaudited Consolidated Financial Statements include the accounts of WSFS Financial Corporation (the Company, our Company, we, our or us), Wilmington Savings Fund Society, FSB (WSFS Bank or the Bank), WSFS Wealth Management, LLC (Powdermill), WSFS Capital Management, LLC (West Capital) and Cypress Capital Management, LLC (Cypress). We also have one unconsolidated subsidiary, WSFS Capital Trust III (the Capital Trust). WSFS Bank has three wholly-owned subsidiaries: WSFS Wealth Investments, 1832 Holdings, Inc. and Monarch Entity Services LLC (Monarch).

Overview

Founded in 1832, the Bank is one of the ten oldest bank and trust companies continuously operating under the same name in the United States (U.S.). We provide residential and commercial real estate, commercial and consumer lending services, as well as retail deposit and cash management services. Lending activities are funded primarily with customer deposits and borrowings. In addition, we offer a variety of wealth management and trust services to personal and corporate customers. The Federal Deposit Insurance Corporation (FDIC) insures our customers’ deposits to their legal maximums. We serve our customers primarily from our 77 offices located in Delaware (46), Pennsylvania (29), Virginia (1) and Nevada (1) and through our website at www.wsfsbank.com. Information on our website is not incorporated by reference into this quarterly report.

In preparing the unaudited Consolidated Financial Statements, we are required to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses. Amounts subject to significant estimates include the allowance for loan losses and reserves for lending related commitments, goodwill, intangible assets, post-retirement benefit obligations, the fair value of financial instruments, other-than-temporary impairment (OTTI), and the income tax valuation allowance. Among other effects, changes to these estimates could result in future impairments of investment securities, goodwill and intangible assets and establishment of the allowance and lending related commitments as well as increased post-retirement benefits expense.

Our accounting and reporting policies conform to Generally Accepted Accounting Principles (GAAP) in the U.S., prevailing practices within the banking industry for interim financial information and Rule 10-01 of SEC Regulation S-X (Rule 10-01). Rule 10-01 does not require us to include all information and notes that would be required in audited financial statements. Operating results for the periods presented are not necessarily indicative of the results that may be expected for any future quarters or for the year ending December 31, 2017. These unaudited, interim Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and related notes included in our 2016 Annual Report on Form 10-K that was filed with the SEC on March 1, 2017 and is available at www.sec.gov or on our website at http://investors.wsfsbank.com/financials.cfm. Whenever necessary, reclassifications have been made to the prior period Consolidated Financial Statements to conform to the current period’s presentation. All significant intercompany transactions were eliminated in consolidation.

The significant accounting policies used in preparation of our Consolidated Financial Statements are disclosed in our 2016 Annual Report on Form 10-K. There have not been any material changes in our significant accounting policies from those disclosed in our 2016 Annual Report on Form 10-K.

Senior Debt

On June 13, 2016, the Company issued $100.0 million of senior unsecured fixed-to-floating rate notes. The senior unsecured notes mature on June 15, 2026 and have a fixed coupon rate of 4.50% from issuance until June 15, 2021 and a variable coupon rate of three month LIBOR plus 3.30% from June 15, 2021 until maturity. The senior unsecured notes may be redeemed beginning on June 15, 2021 at 100% of principal plus accrued and unpaid interest. The net proceeds from the issuance of the notes are being used for general corporate purposes.

In 2012, we issued and sold $55.0 million in aggregate principal amount of 6.25% senior notes due 2019 (the “2012 senior debt”). The 2012 senior debt is unsecured and ranks equally with all of our other present and future unsecured unsubordinated obligations. The 2012 senior debt is effectively subordinated to our secured indebtedness and structurally subordinated to the indebtedness of our subsidiaries. At our option, the 2012 senior debt is callable, in whole or in part, on September 1, 2017, or on any scheduled interest payment date thereafter, at a price equal to the outstanding principal amount to be redeemed plus accrued and unpaid interest. The 2012 senior debt matures on September 1, 2019.

Acquisitions in 2016

On August 12, 2016, we completed the acquisition of Penn Liberty Financial Corp. (Penn Liberty), a community bank headquartered in Wayne, Pennsylvania. We expect this acquisition to build our market share, deepen our presence in the southeastern Pennsylvania market, and enhance our customer base. The results of Penn Liberty’s operations are included in our Consolidated Financial Statements since the date of the acquisition. See Note 2 – Business Combinations for further information.

During the third and fourth quarters of 2016, respectively, we acquired the assets of Powdermill Financial Solutions LLC, a multi-family office serving an affluent clientele in the local community and throughout the U.S., and West Capital Management, Inc., an independent, fee-only wealth management firm providing fully customized solutions tailored to the unique needs of institutions and high net worth individuals which operates under a multi-family office philosophy. These acquisitions align with our strategic plan to expand our wealth management offerings and to diversify our fee-income generating businesses.

Correction of Prior Period Balances

The Consolidated Statements of Income for the quarter ended March 31, 2016 has been revised to correct an immaterial error in Noninterest income - Other revenue and Noninterest expense - Other operating expense related to revenue earned for cash servicing fees. As a result, the Consolidated Statement of Income has been revised to reflect these changes, as follows:

	Three months ended March 31, 2016
	As originally reported		Adjustments		As revised
Noninterest income - Other revenue	$	3,972	$	598	$	4,570
Noninterest expense - Other operating expense	7,061		598		7,659

The above revision had no effect on earnings per share or retained earnings. Periods not presented herein will be revised, as applicable, as they are included in future filings.

RECENT ACCOUNTING PRONOUNCEMENTS

Accounting Guidance Adopted in 2017

In March 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-05: Derivatives and Hedging (Topic 815): Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships, which amends Accounting Standards Codification (ASC) Topic 815: Derivatives and Hedging. This new guidance clarifies that the novation of a derivative contract (i.e., a change in the counterparty) in a hedge accounting relationship does not, in and of itself, cause a hedge accounting relationship to be discontinued because it does not represent a termination of the original derivative instrument or a change in the critical terms of the hedge relationship. This new guidance is effective for annual reporting periods beginning after December 15, 2016 and may be adopted prospectively or retroactively. Early adoption is permitted, including adoption in an interim period. The Company adopted this accounting guidance during the quarter ended March 31, 2017 with no impact to our Consolidated Financial statements, as the standard is applied on a prospective basis.

In March 2016, the FASB issued ASU No. 2016-06, Contingent Put and Call Options in Debt Instruments, Derivatives and Hedging (Topic 815). ASU 2016-06 clarifies that determining whether the economic characteristics of a put or call are clearly and closely related to its debt host requires only an assessment of the four-step decision sequence outlined in FASB ASC paragraph 815-15-25-24. Additionally, entities are not required to separately assess whether the contingency itself is clearly and closely related. The standard is effective for public business entities in interim and annual periods in fiscal years beginning after December 15, 2016. Early adoption is permitted in any interim period for which the entity’s financial statements have not been issued, but would be retroactively applied to the beginning of the year that includes the interim period. The standard requires a modified retrospective transition approach, with a cumulative catch-up adjustment to opening retained earnings in the period of adoption. For instruments that are eligible for the fair value option, an entity has a one-time option to irrevocably elect to measure the debt instrument affected by the standard in its entirety at fair value with changes in fair value recognized in earnings. The Company adopted this accounting guidance during the quarter ended March 31, 2017 with no impact on our Consolidated Statements of Income or Consolidated Statements of Financial Condition.

In March 2016, the FASB issued ASU No. 2016-07, Simplifying the Transition to the Equity Method of Accounting, Investments - Equity Method and Joint Ventures (Topic 323). ASU 2016-07 eliminates the requirement for an investor to retroactively apply the equity method when its increase in ownership interest (or degree of influence) in an investee triggers equity method accounting. The standard is effective for all entities in annual and interim periods in fiscal years beginning after December 15, 2016. Early adoption is permitted. The new guidance will be applied prospectively to changes in ownership (or influence) after the adoption date. The Company adopted this accounting guidance during the quarter ended March 31, 2017 with no impact to our Consolidated Financial statements, as the standard is applied on a prospective basis.

Accounting Guidance Pending Adoption at March 31, 2017

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606). This ASU supersedes the revenue recognition requirements in ASC 605, Revenue Recognition. ASU No. 2014-09 will require an entity to recognize revenue when it transfers promised goods or services to customers using a five-step model that requires entities to exercise judgment when considering the terms of the contracts. In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date. This amendment defers the effective date of ASU 2014-09 by one year. In March 2016, the FASB issued ASU 2016- 08, Principal versus Agent Considerations (Reporting Gross versus Net), which amends the principal versus agent guidance and clarifies that the analysis must focus on whether the entity has control of the goods or services before they are transferred to the customer. In addition, the FASB issued ASU Nos. 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers and 2016-12, Narrow-Scope Improvements and Practical Expedients, both of which provide additional clarification of certain provisions in Topic 606. These Accounting Standards Codification (“ASC”) updates are effective for public business entities in annual and interim reporting periods in fiscal years beginning after December 15, 2017. Early application is permitted for all entities, but not before annual reporting periods beginning after December 15, 2016. The standard permits the use of either the retrospective or retrospectively with the cumulative effect transition method. The Company is currently in the process of evaluating all revenue streams, accounting policies, practices and reporting to identify and understand any impact on the Company’s Consolidated Financial Statements. Our preliminary evaluation suggests that adoption of this guidance is not expected to have a material effect on our Consolidated Financial Statements. The Company anticipates completing our assessment in the second half of 2017.

In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments - Overall (Subtopic 825-10), Recognition and Measurement of Financial Assets and Financial Liabilities. This amendment requires that equity investments be measured at fair value with changes in fair value recognized in net income. When fair value is not readily determinable an entity may elect to measure the equity investment at cost, minus impairment, plus or minus any change in the investment’s observable price. For financial liabilities that are measured at fair value, the amendment requires an entity to present separately, in other comprehensive income, any change in fair value resulting from a change in instrument specific credit risk. ASU 2016-01 is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early adoption is permitted. Entities may apply this guidance on a prospective or retrospective basis. The Company does not expect the application of this guidance to have a material impact on its Consolidated Financial Statements.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). This ASU revises the accounting related to lessee accounting. Under the new guidance, lessees will be required to recognize a lease liability and a right-of-use asset for all leases. The new lease guidance also simplifies the accounting for sale and leaseback transactions primarily because lessees must recognize lease assets and lease liabilities. ASU 2016-02 is effective for the first interim period within annual periods beginning after December 15, 2018, with early adoption permitted. Adoption using the modified retrospective transition approach is required for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The Company is currently evaluating the impact of adopting ASU 2016-02 on its Consolidated Financial Statements.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326). ASU 2016-13 replaces the incurred loss impairment methodology in current GAAP with an expected credit loss methodology and requires consideration of a broader range of information to determine credit loss estimates. Financial assets measured at amortized cost will be presented at the net amount expected to be collected by using an allowance for credit losses. Purchased credit impaired loans will receive an allowance account at the acquisition date that represents a component of the purchase price allocation. Credit losses relating to available-for-sale debt securities will be recorded through an allowance for credit losses, with such allowance limited to the amount by which fair value is below amortized cost. This guidance is effective for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years. The Company is currently evaluating the impact of this guidance on its Consolidated Financial Statements.

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 represents the Emerging Issues Task Force’s (“the EITF”) final consensus on eight issues related to the classification of cash payments and receipts in the statement of cash flows for a number of common transactions. The consensus also clarifies when identifiable cash flows should be separated versus classified based on their predominant source or use. This guidance is effective for fiscal years beginning after December 15, 2017 and interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. The Company is currently evaluating the impact of this guidance on its Consolidated Financial Statements.

In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. ASU 2017-01 provides a new, two-step framework for determining whether a transaction is accounted for as an acquisition (or disposal) of assets or a business. The first step is evaluating whether substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets; if so, the transaction is not considered a business. Also, in order to be considered a business, the transaction would need to include an input and a substantive process that together significantly contribute to the ability to create outputs. The guidance is effective for public entities in annual and interim periods in fiscal years beginning after December 15, 2017. Early adoption is permitted for transactions that have not been reported in financial statements that have been issued or been made available for issuance. The Company does not expect the application of this guidance to have a material impact on its Consolidated Financial Statements.

In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. ASU 2017-04 simplifies the measurement of goodwill impairment by removing the hypothetical purchase price allocation (“Step 2”). The new guidance requires an impairment of goodwill be measured as the amount by which a reporting unit’s carrying value exceeds its fair value, up to the amount of goodwill recorded. The guidance is effective for public entities in annual and interim periods in fiscal years beginning after December 15, 2019. Early adoption is permitted for goodwill impairment tests with measurement dates after January 1, 2017. The Company does not expect the application of this guidance to have a material impact on its Consolidated Financial Statements.

In February 2017, the FASB issued ASU No. 2017-05, Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets. ASU 2017-05 provides clarification of the scope of ASC 610-20. Specifically, the new guidance clarifies that ASC 610-20 applies to nonfinancial assets which do not meet the definition of a business or not-for-profit activity. Further, the new guidance clarifies that a financial asset is within the scope of ASC 610-20 if it meets the definition of an in-substance nonfinancial asset which is defined as a financial asset promised to a counterparty in a contract where substantially all of the assets promised are nonfinancial. Finally, the new guidance clarifies that each distinct nonfinancial asset and in-substance nonfinancial asset should be derecognized when the counterparty obtains control of it. The guidance is effective for public entities in annual and interim reporting periods in fiscal years beginning after December 15, 2017. Early application is permitted for all entities, but not before annual reporting periods beginning after December 15, 2016. The Company is currently evaluating the impact of adopting ASU 2017-05 on its Consolidated Financial Statements.

In March 2017, the FASB issued ASU No. 2017-07, Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The new guidance requires that the service cost component of net periodic pension cost be disclosed with other compensation costs in the income statement. For all other cost components, an entity must either separately disclose the other cost components in separate line item(s) outside a subtotal of income from operations in the income statement or disclose the line item(s) used to present the other cost components in the income statement. The guidance is effective for public entities in annual and interim periods in fiscal years beginning after December 15, 2017. Early adoption is permitted. The Company does not expect the application of this guidance to have a material impact on its Consolidated Financial Statements.

In March 2017, the FASB issued ASU No. 2017-08, Premium Amortization on Purchased Callable Debt Securities. The new guidance requires the amortization period for certain non-contingent callable debt securities held at a premium to end at the earliest call date of the debt security. If the call option is not exercised at the earliest call date, the guidance requires the debt security's effective yield to be reset based on the contractual payment terms of the debt security. The guidance is effective for public entities in annual and interim periods in fiscal years beginning after December 15, 2018. Early adoption is permitted. Use of the modified retrospective method, with a cumulative-effect adjustment to retained earnings, is required. In the period of adoption, a change in accounting principle disclosure is required. The Company does not expect the application of this guidance to have a material impact on its Consolidated Financial Statements.

XML

Business Combinations

3 Months Ended

Mar. 31, 2017

Business Combinations [Abstract]

Business Combinations

BUSINESS COMBINATIONS

Penn Liberty Financial Corporation

On August 12, 2016, we completed the acquisition of Penn Liberty. The acquisition of Penn Liberty was accounted for as a business combination using the acquisition method of accounting and, accordingly, assets acquired, liabilities assumed and consideration transferred were recorded at their estimated fair values as of the acquisition date. The fair values are preliminary estimates and are subject to adjustment during the one-year measurement period after the acquisition.

In connection with the merger, the consideration transferred and the fair value of identifiable assets acquired and liabilities assumed, including remeasurement adjustments subsequent to the date of acquisition, are summarized in the following table:

(Dollars in thousands)	Fair Value
Consideration Transferred:
Common shares issued (1,806,748)	$	68,352
Cash paid to Penn Liberty stock and option holders	40,549
Value of consideration	108,901
Assets acquired:
Cash and due from banks	102,301
Investment securities	627
Loans	483,482
Premises and equipment	6,817
Deferred income taxes	6,542
Bank owned life insurance	8,666
Core deposit intangible	2,882
Other real estate owned	996
Other assets	12,092
Total assets	624,405
Liabilities assumed:
Deposits	568,706
Other borrowings	10,000
Other liabilities	3,977
Total liabilities	582,683
Net assets acquired:	41,722
Goodwill resulting from acquisition of Penn Liberty	$	67,179

The following table details the change to goodwill recorded subsequent to acquisition:

(Dollars in thousands)	Fair Value
Goodwill resulting from the acquisition of Penn Liberty reported as of December 31, 2016	$	68,814
Effects of adjustments to:
Deferred income taxes	880
Other assets	(1,447		)
Other liabilities	(1,068		)
Adjusted goodwill resulting from the acquisition of Penn Liberty as of March 31, 2017	$	67,179

In many cases, the fair values of assets acquired and liabilities assumed were determined by estimating the cash flows expected to result from those assets and liabilities and discounting them at appropriate market rates.

XML

Earnings Per Share

3 Months Ended

Mar. 31, 2017

Earnings Per Share [Abstract]

Earnings Per Share

EARNINGS PER SHARE

The following table shows the computation of basic and diluted earnings per share:

	Three Months Ended March 31,
(Dollars and Shares in thousands, except per share data)	2017		2016
Numerator:
Net income	$	18,937	$	15,770
Denominator:
Weighted average basic shares	31,407		29,671
Dilutive potential common shares	942		558
Weighted average fully diluted shares	32,349		30,229
Earnings per share:
Basic	$	0.60	$	0.53
Diluted	$	0.59	$	0.52
Outstanding common stock equivalents having no dilutive effect	22		42

XML

Investment Securities

3 Months Ended

Mar. 31, 2017

Investments, Debt and Equity Securities [Abstract]

Investment Securities

INVESTMENT SECURITIES

The following tables detail the amortized cost and the estimated fair value of our available-for-sale and held-to-maturity investment securities. None of our investment securities are classified as trading.

(Dollars in thousands)	Amortized Cost		Gross Unrealized  Gain		Gross Unrealized  Loss		Fair Value
Available-for-Sale Securities:
March 31, 2017
GSE	$	33,051	$	2	$	72	$	32,981
CMO	280,576		699		3,564		277,711
FNMA MBS	393,356		984		8,289		386,051
FHLMC MBS	65,228		204		1,261		64,171
GNMA MBS	27,767		275		445		27,597
Other investments	634		—		20		614
	$	800,612	$	2,164	$	13,651	$	789,125
December 31, 2016
GSE	$	35,061	$	9	$	60	$	35,010
CMO	264,607		566		3,957		261,216
FNMA MBS	414,218		950		9,404		405,764
FHLMC MBS	64,709		135		1,330		63,514
GNMA MBS	28,540		303		427		28,416
Other investments	626		—		3		623
	$	807,761	$	1,963	$	15,181	$	794,543

(Dollars in thousands)	Amortized Cost		Gross Unrealized  Gain		Gross Unrealized  Loss		Fair Value
Held-to-Maturity Securities(1)
March 31, 2017
State and political subdivisions	$	163,611	$	646	$	1,016	$	163,241
December 31, 2016
State and political subdivisions	$	164,346	$	271	$	1,385	$	163,232

⁽¹⁾  Held-to–maturity securities transferred from available-for-sale are included in held-to-maturity at fair value at the time of transfer. The amortized cost of held-to-maturity securities included net unrealized gains of $2.1 million and $2.2 million at March 31, 2017 and December 31, 2016, respectively, related to securities transferred, which are offset in Accumulated Other Comprehensive Income, net of tax.

The scheduled maturities of investment securities available for sale and held to maturity at March 31, 2017 and December 31, 2016 are presented in the table below:

	Available for Sale (1) (2)
	Amortized		Fair
(Dollars in thousands)	Cost		Value
March 31, 2017
Within one year	$	20,012	$	19,997
After one year but within five years	18,059		17,981
After five years but within ten years	210,595		205,242
After ten years	551,312		545,291
	$	799,978	$	788,511
December 31, 2016
Within one year	$	16,009	$	16,017
After one year but within five years	19,052		18,992
After five years but within ten years	276,635		270,300
After ten years	495,439		488,611
	$	807,135	$	793,920
	Held to Maturity (2)
	Amortized		Fair
(Dollars in thousands)	Cost		Value
March 31, 2017
Within one year	$	—	$	—
After one year but within five years	5,940		5,975
After five years but within ten years	10,482		10,511
After ten years	147,189		146,755
	$	163,611	$	163,241
December 31, 2016
Within one year	$	—	$	—
After one year but within five years	6,168		6,162
After five years but within ten years	8,882		8,870
After ten years	149,296		148,200
	$	164,346	$	163,232

 ⁽¹⁾ Included in the investment portfolio, but not in the table above, is a mutual fund with an amortized cost and fair value of $0.6 million as of March 31, 2017 and December 31, 2016 which has no stated maturity.

⁽²⁾  Actual maturities could differ

Mortgage-backed securities (MBS) have expected maturities that differ from their contractual maturities. These differences arise because borrowers have the right to call or prepay obligations with or without a prepayment penalty.

Investment securities with fair market values aggregating $615.8 million and $562.5 million were pledged as collateral for retail customer repurchase agreements, municipal deposits, and other obligations as of March 31, 2017 and December 31, 2016, respectively.

During the first three months of 2017, we sold $263.0 million of investment securities categorized as available for sale, resulting in realized gains of $0.3 million and one security with an immaterial realized loss. During the first three months of 2016, we sold $38.9 million of investment securities categorized as available for sale, resulting in realized gains of $0.3 million and no realized losses. The cost basis of all investment securities sales is based on the specific identification method.

As of March 31, 2017 and December 31, 2016, our investment securities portfolio had remaining unamortized premiums of $16.3 million and $18.0 million, respectively, and unaccreted discounts of $0.6 million and $0.4 million, respectively.

For investment securities with unrealized losses, the table below shows our gross unrealized losses and fair value by investment category and length of time that individual securities were in a continuous unrealized loss position at March 31, 2017.

	Duration of Unrealized Loss Position
	Less than 12 months				12 months or longer				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(Dollars in thousands)	Value		Loss		Value		Loss		Value		Loss
Available-for-sale securities:
GSE	$	25,981	$	72	$	—	$	—	$	25,981	$	72
CMO	161,225		3,469		4,239		95		165,464		3,564
FNMA MBS	276,175		8,289		—		—		276,175		8,289
FHLMC MBS	41,765		1,261		—		—		41,765		1,261
GNMA MBS	16,236		445		—		—		16,236		445
Other investments	634		20		—		—		634		20
Total temporarily impaired investments	522,016		13,556		4,239		95		526,255		13,651
	Less than 12 months				12 months or longer				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(Dollars in thousands)	Value		Loss		Value		Loss		Value		Loss
Held-to-maturity securities:
State and political subdivisions	$	84,121	$	969	$	1,960	$	47	$	86,081	$	1,016
Total temporarily impaired investments	$	84,121	$	969	$	1,960	$	47	$	86,081	$	1,016

For investment securities with unrealized losses, the table below shows our gross unrealized losses and fair value by investment category and length of time that individual securities were in a continuous unrealized loss position at December 31, 2016.

	Duration of Unrealized Loss Position
	Less than 12 months				12 months or longer				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(Dollars in thousands)	Value		Loss		Value		Loss		Value		Loss
Available-for-sale securities:
GSE	$	21,996	$	60	$	—	$	—	$	21,996	$	60
CMO	160,572		3,867		4,654		90		165,226		3,957
FNMA MBS	50,878		1,330		—		—		50,878		1,330
FHLMC MBS	300,403		9,404		—		—		300,403		9,404
GNMA MBS	16,480		427		—		—		16,480		427
Other investments	623		3		—		—		623		3
Total temporarily impaired investments	$	550,952	$	15,091	$	4,654	$	90	$	555,606	$	15,181
	Less than 12 months				12 months or longer				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(Dollars in thousands)	Value		Loss		Value		Loss		Value		Loss
Held-to-maturity securities:
State and political subdivisions	$	112,642	$	1,374	$	695	$	11	$	113,337	$	1,385
Total temporarily impaired investments	$	112,642	$	1,374	$	695	$	11	$	113,337	$	1,385

At March 31, 2017, we owned investment securities totaling $612.3 million for which the amortized cost basis exceeded fair value. Total unrealized losses on these securities were $14.7 million at March 31, 2017. The temporary impairment is the result of changes in market interest rates subsequent to the purchase of the securities. Our investment portfolio is reviewed each quarter for indications of OTTI. This review includes analyzing the length of time and the extent to which the fair value has been lower than the amortized cost, the financial condition and near-term prospects of the issuer, including any specific events which may influence the operations of the issuer and our intent and ability to hold the investment for a period of time sufficient to allow for full recovery of the unrealized loss. We evaluate our intent and ability to hold securities based upon our investment strategy for the particular type of security and our cash flow needs, liquidity position, capital adequacy and interest rate risk position. We do not have the intent to sell, nor is it more likely-than-not we will be required to sell these securities before we are able to recover the amortized cost basis.

All securities, with the exception of one having a fair value of $1.0 million at March 31, 2017, were AA-rated or better at the time of purchase and remained investment grade at March 31, 2017. All securities were evaluated for OTTI at March 31, 2017 and December 31, 2016. The result of this evaluation showed no OTTI as of March 31, 2017 or December 31, 2016. The estimated weighted average duration of MBS was 5.34 years at March 31, 2017.

XML

Loans

3 Months Ended

Mar. 31, 2017

Receivables [Abstract]

Loans

LOANS

The following table shows our loan portfolio by category:

(Dollars in thousands)	March 31, 2017		December 31, 2016
Commercial and industrial	$	1,339,867	$	1,287,731
Owner-occupied commercial	1,092,292		1,078,162
Commercial mortgages	1,165,556		1,163,554
Construction	255,760		222,712
Residential (1)	281,760		289,611
Consumer	464,898		450,029
	4,600,133		4,491,799
Less:
Deferred fees, net	8,156		7,673
Allowance for loan losses	39,826		39,751
Net loans	$	4,552,151	$	4,444,375

⁽¹⁾ Includes Reverse Mortgages, at fair value of $22.5 million at March 31, 2017 and $22.6 million at December 31, 2016.

The following table shows the outstanding principal balance and carrying amounts for acquired credit impaired loans for which the Company applies ASC 310-30 as of the dates indicated:

(Dollars in thousands)	March 31, 2017		December 31, 2016
Outstanding principal balance	$	38,418	$	41,574
Carrying amount	30,783		33,104
Allowance for loan losses	464		510

The following table presents the changes in accretable yield on the acquired credit impaired loans for the three months endedMarch 31, 2017:

(Dollars in thousands)	Three months ended March 31, 2017
Balance at beginning of period	$	5,150
Accretion	(792		)
Reclassification from nonaccretable difference	(144		)
Additions/adjustments	(112		)
Disposals	—
	$	4,102

XML

Allowance for Loan Losses and Credit Quality Information

3 Months Ended

Mar. 31, 2017

Receivables [Abstract]

Allowance for Loan Losses and Credit Quality Information

ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY INFORMATION

Allowance for Loan Losses

We maintain an allowance for loan losses which represents our best estimate of probable losses within our loan portfolio. As losses are realized, they are charged to this allowance. We established our allowance in accordance with guidance provided in the SEC’s Staff Accounting Bulletin 102 (SAB 102), Selected Loan Loss Allowance Methodology and Documentation Issues, Accounting Standard Codification ("ASC") Contingencies (ASC 450) and Receivables (ASC 310). When we have reason to believe it is probable that we will not be able to collect all contractually due amounts of principal and interest, loans are evaluated for impairment on an individual basis and a specific allocation of the allowance is assigned in accordance with ASC 310-10. We also maintain an allowance for loan losses on acquired loans when: (i) for loans accounted for under ASC 310-30, there is deterioration in credit quality subsequent to acquisition and (ii) for loans accounted for under ASC 310-20, the inherent losses in the loans exceed the remaining credit discount recorded at the time of acquisition. The determination of the allowance for loan losses requires significant judgment reflecting our best estimate of impairment related to specifically identified impaired loans as well as probable loan losses in the remaining loan portfolio. Our evaluation is based on a continuing review of these portfolios. The following are included in our allowance for loan losses:

• Specific reserves for impaired loans

• An allowance for each pool of homogenous loans based on historical loss experience

• Adjustments for qualitative and environmental factors allocated to pools of homogenous loans

When it is probable that the Bank will be unable to collect all amounts due (interest and principal) in accordance with the contractual terms of the loan agreement, it assigns a specific reserve to that loan, if necessary. Unless loans are well-secured and collection is imminent, loans greater than 90 days past due are deemed impaired and their respective reserves are generally charged-off once the loss has been confirmed. Estimated specific reserves are based on collateral values, estimates of future cash flows or market valuations. We charge loans off when they are deemed to be uncollectible. During the three months endedMarch 31, 2017 and 2016, net charge-offs totaled $2.1 million or 0.19% of average loans annualized, and $0.3 million, or 0.03% of average loans annualized, respectively.

Allowances for pooled homogeneous loans, that are not deemed impaired, are based on historical net loss experience. Estimated losses for pooled portfolios are determined differently for commercial loan pools and retail loan pools. Commercial loans are pooled as follows: commercial, owner-occupied commercial, commercial mortgages and construction. Each pool is further segmented by internally assessed risk ratings. Loan losses for commercial loans are estimated by determining the probability of default and expected loss severity upon default. Probability of default is calculated based on the historical rate of migration to impaired status during the last 25 quarters. During the three months ended March 31, 2017, we increased the look-back period to 25 quarters from the 24 quarters used at December 31, 2016. This increase in the look-back period allows us to continue to anchor to the fourth quarter of 2010 to ensure that the core reserves calculated by the ALLL model are adequately considering the losses within a full credit cycle.

Loss severity upon default is calculated as the actual loan losses (net of recoveries) on impaired loans in their respective pool during the same time frame. Retail loans are pooled into the following segments: residential mortgage, consumer secured and consumer unsecured loans. Pooled reserves for retail loans are calculated based solely on average net loss rates over the same 25 quarter look-back period.

Qualitative adjustment factors consider various current internal and external conditions which are allocated among loan types and take into consideration:

• Current underwriting policies, staff, and portfolio mix,

• Internal trends of delinquency, nonaccrual and criticized loans by segment,

• Risk rating accuracy, control and regulatory assessments/environment,

• General economic conditions - locally and nationally,

• Market trends impacting collateral values,

• The competitive environment, as it could impact loan structure and underwriting, and

• Valuation complexity by segment.

The above factors are based on their relative standing compared to the period in which historic losses are used in core reserve estimates and current directional trends. Qualitative factors in our model can add to or subtract from core reserves.

The allowance methodology uses a loss emergence period (LEP), which is the period of time between an event that triggers the probability of a loss and the confirmation of the loss. We estimate the commercial LEP to be approximately 8 quarters as of March 31, 2017. Our residential mortgage and consumer LEP remained at 4 quarters as of March 31, 2017. We evaluate LEP quarterly for reasonableness and complete a detailed historical analysis of our LEP annually for our commercial portfolio and review the current 4 quarter LEP for the retail portfolio to determine the continued reasonableness of this assumption.

In prior periods, we had a component of the allowance for model estimation and complexity risk reserve. During the second quarter of 2016 as a result of continued improvement in the model and normal review of the factors, we removed the model estimation and complexity risk reserve from our calculation of the allowance of loan losses.

Our loan officers and risk managers meet at least quarterly to discuss and review the conditions and risks associated with individual problem loans. In addition, various regulatory agencies periodically review our loan ratings and allowance for loan losses and the Bank’s internal loan review department performs loan reviews.

The following tables provide the activity of our allowance for loan losses and loan balances for the three months endedMarch 31, 2017:

	Three months ended March 31, 2017
(Dollars in thousands)	Commercial			Owner-occupied Commercial			Commercial Mortgages			Construction			Residential(1)			Consumer			Total
Allowance for loan losses
Beginning balance	$	13,339		$	6,588		$	8,915		$	2,838		$	2,059		$	6,012		$	39,751
Charge-offs	(1,255		)	(192		)	(104		)	(14		)	(11		)	(1,143		)	(2,719		)
Recoveries	84			75			46			2			120			305			632
Provision (credit)	1,949			(441		)	(518		)	158			(114		)	1,080			2,114
Provision for acquired loans	88			—			(4		)	(23		)	—			(13		)	48
Ending balance	$	14,205		$	6,030		$	8,335		$	2,961		$	2,054		$	6,241		$	39,826
Period-end allowance allocated to:
Loans individually evaluated for impairment	$	1,860		$	—		$	1,395		$	500		$	887		$	194		$	4,836
Loans collectively evaluated for impairment	12,165			6,015			6,763			2,397			1,144			6,042			34,526
Acquired loans evaluated for impairment	180			15			177			64			23			5			464
Ending balance	$	14,205		$	6,030		$	8,335		$	2,961		$	2,054		$	6,241		$	39,826
Period-end loan balances evaluated for:
Loans individually evaluated for impairment (2)	$	16,767		$	4,020		$	9,771		$	3,130		$	14,280		$	9,029		$	56,997
Loans collectively evaluated for impairment	1,175,911			919,508			928,925			225,718			158,430			405,285			3,813,777
Acquired nonimpaired loans	141,933			156,724			216,410			24,540			85,679			50,321			675,607
Acquired impaired loans	5,256			12,040			10,450			2,372			866			263			31,247
Ending balance (3)	$	1,339,867		$	1,092,292		$	1,165,556		$	255,760		$	259,255		$	464,898		$	4,577,628

⁽¹⁾  Period-end loan balance excludes Reverse Mortgages, at fair value of $22.5 million.

⁽²⁾  The difference between this amount and nonaccruing loans represents accruing troubled debt restructured loans of $17.3 million for the period ending March 31, 2017. Accruing troubled debt restructured loans are considered impaired loans.

⁽³⁾  Ending loan balances do not include net deferred fees.

The following table provides the activity of the allowance for loan losses and loan balances for the three months ended March 31, 2016:

	Three months ended March 31, 2016
(Dollars in thousands)	Commercial			Owner - occupied Commercial			Commercial Mortgages			Construction			Residential(1)			Consumer			Complexity Risk(2)		Total
Allowance for loan losses
Beginning balance	$	11,156		$	6,670		$	6,487		$	3,521		$	2,281		$	5,964		$	1,010	$	37,089
Charge-offs	(179		)	—			(17		)	(26		)	(14		)	(631		)	—		(867		)
Recoveries	110			38			79			46			22			259			—		554
Provision (credit)	484			(6		)	(37		)	72			(20		)	400			14		907
Provision for acquired loans	(89		)	—			4			(4		)	—			(38		)	—		(127		)
Ending balance	$	11,482		$	6,702		$	6,516		$	3,609		$	2,269		$	5,954		$	1,024	$	37,556
Period-end allowance allocated to:
Loans individually evaluated for impairment	$	1,473		$	—		$	—		$	211		$	911		$	208		$	—	$	2,803
Loans collectively evaluated for impairment	10,005			6,680			6,427			3,398			1,354			5,746			1,024		34,634
Acquired loans evaluated for impairment	4			22			89			—			4			—			—		119
Ending balance	$	11,482		$	6,702		$	6,516		$	3,609		$	2,269		$	5,954		$	1,024	$	37,556
Period-end loan balances:
Loans individually evaluated for impairment (3)	$	5,278		$	1,270		$	2,678		$	1,419		$	15,260		$	7,795		$	—	$	33,700
Loans collectively evaluated for impairment	957,863			839,819			893,036			194,654			161,610			336,053			—		3,383,035
Acquired nonimpaired loans	107,380			49,765			80,795			27,711			73,240			15,803			—		354,694
Acquired impaired loans	12,600			4,603			10,557			3,564			955			5			—		32,284
Ending balance (4)	$	1,083,121		$	895,457		$	987,066		$	227,348		$	251,065		$	359,656		$	—	$	3,803,713

⁽¹⁾  Period-end loan balance excludes Reverse Mortgages, at fair value of $24.7 million.

⁽²⁾  Represents the portion of the allowance for loan losses established to capture factors not already included in other components in our allowance for loan losses methodology.

⁽³⁾  The difference between this amount and nonaccruing loans represents accruing troubled debt restructured loans of $13.9 million for the period ending March 31, 2016. Accruing troubled debt restructured loans are considered impaired loans.

⁽⁴⁾  Ending loan balances do not include net deferred fees.

Nonaccrual and Past Due Loans

Nonaccruing loans are those on which the accrual of interest has ceased. Typically, we discontinue accrual of interest on originated loans after payments become more than 90 days past due or earlier if we do not expect the full collection of principal or interest in accordance with the terms of the loan agreement. Interest accrued but not collected at the date a loan is placed on nonaccrual status is reversed and charged against interest income. In addition, the accretion of net deferred loan fees and amortization of net deferred loan costs is suspended when a loan is placed on nonaccrual status. Subsequent cash receipts are applied either to the outstanding principal balance or recorded as interest income, depending on our assessment of the ultimate collectability of principal and interest. Loans greater than 90 days past due and still accruing are defined as loans contractually past due 90 days or more as to principal or interest payments, but which remain in accrual status because they are considered well secured and are in the process of collection.

The following tables show our nonaccrual and past due loans at the dates indicated:

	March 31, 2017
(Dollars in thousands)	30–59 Days Past Due  and Still  Accruing			60–89 Days Past Due and Still  Accruing			Greater  Than 90 Days Past Due and Still Accruing			Total Past Due And Still Accruing			Accruing Current Balances			Acquired Impaired Loans			Nonaccrual Loans			Total Loans
Commercial	$	783		$	467		$	—		$	1,250		$	1,316,841		$	5,256		$	16,520		$	1,339,867
Owner-occupied commercial	341			500			—			841			1,075,391			12,040			4,020			1,092,292
Commercial mortgages	451			—			343			794			1,144,617			10,450			9,695			1,165,556
Construction	37			—			466			503			252,885			2,372			—			255,760
Residential(1)	2,020			119			850			2,989			250,443			866			4,957			259,255
Consumer	374			612			106			1,092			459,057			263			4,486			464,898
Total (2)	$	4,006		$	1,698		$	1,765		$	7,469		$	4,499,234		$	31,247		$	39,678		$	4,577,628
% of Total Loans	0.08		%	0.04		%	0.04		%	0.16		%	98.29		%	0.68		%	0.87		%	100		%

⁽¹⁾  Residential accruing current balances excludes Reverse Mortgages at fair value of $22.5 million.

⁽²⁾  The balances above include a total of $675.6 million of acquired nonimpaired loans.

	December 31, 2016
(Dollars in thousands)	30–59 Days Past Due  and Still  Accruing			60–89 Days Past Due  and Still  Accruing			Greater  Than 90 Days Past Due and Still Accruing			Total Past Due And Still Accruing			Accruing Current Balances			Acquired Impaired Loans			Nonaccrual Loans			Total Loans
Commercial	$	1,507		$	278		$	—		$	1,785		$	1,277,748		$	6,183		$	2,015		$	1,287,731
Owner-occupied commercial	116			540			—			656			1,063,306			12,122			2,078			1,078,162
Commercial mortgages	167			—			—			167			1,143,180			10,386			9,821			1,163,554
Construction	132			—			—			132			218,886			3,694			—			222,712
Residential(1)	3,176			638			153			3,967			257,234			860			4,967			267,028
Consumer	392			346			285			1,023			444,642			369			3,995			450,029
Total(2)	$	5,490		$	1,802		$	438		$	7,730		$	4,404,996		$	33,614		$	22,876		$	4,469,216
% of Total Loans	0.12		%	0.04		%	0.01		%	0.17		%	98.56		%	0.75		%	0.51		%	100		%

⁽¹⁾  Residential accruing current balances excludes Reverse Mortgages, at fair value of $22.6 million.

⁽²⁾  The balances above include a total of $724.1 million of acquired nonimpaired loans.

Impaired Loans

Loans for which it is probable we will not collect all principal and interest due according to their contractual terms, which is assessed based on the credit characteristics of the loan and/or payment status, are measured for impairment in accordance with the provisions of SAB 102 and FASB ASC 310, Receivables (ASC 310). The amount of impairment is required to be measured using one of three methods: (1) the present value of expected future cash flows discounted at the loan’s effective interest rate; (2) the fair value of collateral, if the loan is collateral dependent or (3) the loan’s observable market price. If the measure of the impaired loan is less than the recorded investment in the loan, a related allowance is allocated for the impairment.

The following tables provide an analysis of our impaired loans at March 31, 2017 and December 31, 2016:

	March 31, 2017
(Dollars in thousands)	Ending Loan Balances		Loans with No Related Reserve (1)		Loans with Related Reserve		Related Reserve		Contractual Principal Balances		Average Loan Balances
Commercial	$	18,550	$	2,598	$	15,952	$	2,040	$	20,197	$	7,535
Owner-occupied commercial	6,210		4,020		2,190		15		6,372		4,155
Commercial mortgages	14,478		4,220		10,258		1,572		19,906		9,288
Construction	4,435		1,117		3,318		564		4,546		2,979
Residential	15,000		8,056		6,944		910		17,904		14,941
Consumer	9,070		7,526		1,544		199		11,578		8,191
Total (2)	$	67,743	$	27,537	$	40,206	$	5,300	$	80,503	$	47,089

⁽¹⁾  Reflects loan balances at or written down to their remaining book balance.

⁽²⁾  The above includes acquired impaired loans totaling $10.7 million in the ending loan balance and $11.8 million in the contractual principal balance.

	December 31, 2016
(Dollars in thousands)	Ending Loan Balances		Loans with No Related Reserve (1)		Loans with Related Reserve		Related Reserve		Contractual Principal Balances		Average Loan Balances
Commercial	$	4,250	$	1,395	$	2,855	$	505	$	5,572	$	5,053
Owner-occupied commercial	4,650		2,078		2,572		15		5,129		3,339
Commercial mortgages	15,065		4,348		10,717		1,433		20,716		7,323
Construction	3,662		—		3,662		303		3,972		2,376
Residential	14,256		7,122		7,134		934		17,298		15,083
Consumer	8,021		6,561		1,460		215		11,978		7,910
Total (2)	$	49,904	$	21,504	$	28,400	$	3,405	$	64,665	$	41,084

⁽¹⁾  Reflects loan balances at or written down to their remaining book balance.

⁽²⁾  The above includes acquired impaired loans totaling $12.8 million in the ending loan balance and $15.0 million in the contractual principal balance.

Interest income of $0.3 million and $0.2 million was recognized on impaired loans during the three months ended March 31, 2017 and March 31, 2016, respectively.

As of March 31, 2017, there were 39 residential loans and 7 commercial loans in the process of foreclosure. The total outstanding balance on the loans was $4.9 million and $2.2 million, respectively. As of December 31, 2016, there were 29 residential loans and 7 commercial loans in the process of foreclosure. The total outstanding balance on the loans was $3.7 million and $3.6 million, respectively.

Reserves on Acquired Nonimpaired Loans

In accordance with FASB ASC 310, loans acquired by the Bank through its mergers with FNBW, Alliance and Penn Liberty are required to be reflected on the balance sheet at their fair values on the date of acquisition as opposed to their contractual values. Therefore, on the date of acquisition establishing an allowance for acquired loans is prohibited. After the acquisition date the Bank performs a separate allowance analysis on a quarterly basis to determine if an allowance for loan loss is necessary. Should the credit risk calculated exceed the purchased loan portfolio’s remaining credit mark, additional reserves will be added to the Bank’s allowance. When a purchased loan becomes impaired after its acquisition, it is evaluated as part of the Bank’s reserve analysis and a specific reserve is established to be included in the Bank’s allowance.

Credit Quality Indicators

Below is a description of each of our risk ratings for all commercial loans:

• Pass. These borrowers currently show no indication of deterioration or potential problems and their loans are considered fully collectible

• Special Mention. Borrowers have potential weaknesses that deserve management’s close attention. Borrowers in this category may be experiencing adverse operating trends, for example, declining revenues or margins, high leverage, tight liquidity, or increasing inventory without increasing sales. These adverse trends can have a potential negative effect on the borrower’s repayment capacity. These assets are not adversely classified and do not expose the Bank to significant risk that would warrant a more severe rating. Borrowers in this category may also be experiencing significant management problems, pending litigation, or other structural credit weaknesses.

• Substandard. Borrowers have well-defined weaknesses that require extensive oversight by management. Borrowers in this category may exhibit one or more of the following: inadequate debt service coverage, unprofitable operations, insufficient liquidity, high leverage, and weak or inadequate capitalization. Relationships in this category are not adequately protected by the sound financial worth and paying capacity of the obligor or the collateral pledged on the loan, if any. A distinct possibility exists that the Bank will sustain some loss if the deficiencies are not corrected.

• Doubtful. Borrowers have well-defined weaknesses inherent in the Substandard category with the added characteristic that the possibility of loss is extremely high. Current circumstances in the credit relationship make collection or liquidation in full highly questionable. A doubtful asset has some pending event that may strengthen the asset that defers the loss classification. Such impending events include: perfecting liens on additional collateral, obtaining collateral valuations, an acquisition or liquidation preceding, proposed merger, or refinancing plan.

• Loss. Borrowers are uncollectible or of such negligible value that continuance as a bankable asset is not supportable. This classification does not mean that the asset has absolutely no recovery or salvage value, but rather that it is not practical to defer writing off this asset even though partial recovery may be recognized sometime in the future.

Residential and Consumer Loans

The residential and consumer loan portfolios are monitored on an ongoing basis using delinquency information and loan type as credit quality indicators. These credit quality indicators are assessed in the aggregate in these relatively homogeneous portfolios. Loans that are greater than 90 days past due are generally considered nonperforming and placed on nonaccrual status.

The following tables provide an analysis of loans by portfolio segment based on the credit quality indicators used to determine the Allowance for Loan Loss.

Commercial Credit Exposure

	March 31, 2017
(Dollars in thousands)	Commercial		Owner-occupied Commercial		Commercial Mortgages		Construction		Total Commercial(1)
									Amount		%
Risk Rating:
Special mention	$	17,590	$	6,849	$	21,931	$	1,008	$	47,378
Substandard:
Accrual	41,136		20,162		3,216		4,489		69,003
Nonaccrual	14,660		4,020		8,300		—		26,980
Doubtful	1,860		—		1,395		—		3,255
Total Special Mention and Substandard	75,246		31,031		34,842		5,497		146,616		4	%
Acquired impaired	5,256		12,040		10,450		2,372		30,118		1	%
Pass	1,259,365		1,049,221		1,120,264		247,891		3,676,741		95	%
Total	$	1,339,867	$	1,092,292	$	1,165,556	$	255,760	$	3,853,475	100	%

⁽¹⁾  Table includes $539.6 million of acquired nonimpaired loans as of March 31, 2017.

	December 31, 2016
(Dollars in thousands)	Commercial		Owner-occupied Commercial		Commercial Mortgages		Construction		Total Commercial(1)
									Amount		%
Risk Rating:
Special mention	$	17,630	$	11,419	$	34,198	$	—	$	63,247
Substandard:
Accrual	45,067		19,871		239		2,193		67,370
Nonaccrual	1,693		2,078		8,574		—		12,345
Doubtful	322		—		1,247		—		1,569
Total Special Mention and Substandard	64,712		33,368		44,258		2,193		144,531		4	%
Acquired impaired	6,183		12,122		10,386		3,694		32,385		1	%
Pass	1,216,836		1,032,672		1,108,910		216,825		3,575,243		95	%
Total	$	1,287,731	$	1,078,162	$	1,163,554	$	222,712	$	3,752,159	100	%

⁽¹⁾  Table includes $573.5 million of acquired nonimpaired loans as of December 31, 2016.

Residential and Consumer Credit Exposure

(Dollars in thousands)	Residential(2)				Consumer				Total Residential and Consumer(3)
	March 31,		December 31,		March 31,		December 31,		March 31, 2017				December 31, 2016
	2017		2016		2017		2016		Amount		Percent		Amount		Percent
Nonperforming(1)	$	14,280	$	13,547	$	9,030	$	7,863	$	23,310	3	%	$	21,410	3	%
Acquired impaired loans	866		860		263		369		1,129		—	%	1,229		—	%
Performing	244,109		252,621		455,605		441,797		699,714		97	%	694,418		97	%
Total	$	259,255	$	267,028	$	464,898	$	450,029	$	724,153	100	%	$	717,057	100	%

⁽¹⁾  Includes $13.7 million as of March 31, 2017 and $12.4 million as of December 31, 2016 of troubled debt restructured mortgages and home equity installment loans that are performing in accordance with the loans’ modified terms and are accruing interest.

⁽²⁾  Residential performing loans excludes $22.5 million and $22.6 million of Reverse Mortgages at fair value as of March 31, 2017 and December 31, 2016, respectively.

⁽³⁾  Total includes $136.0 million and $150.5 million in acquired nonimpaired loans as of March 31, 2017 and December 31, 2016, respectively.

Troubled Debt Restructurings (TDRs)

TDRs are recorded in accordance with FASB ASC 310-40, Troubled Debt Restructuring by Creditors (ASC 310-40). 

The following table presents the balance of TDRs as of the indicated dates:

(Dollars in thousands)	March 31, 2017		December 31, 2016
Performing TDRs	$	17,260	$	14,336
Nonperforming TDRs	10,778		8,451
Total TDRs	28,038		22,787

Approximately $1.9 million and $1.3 million in related reserves have been established for these loans at March 31, 2017 and December 31, 2016, respectively.

The following table presents information regarding the types of loan modifications made for the three months endedMarch 31, 2017:

(Dollars in thousands)	Maturity Date Extension	Discharged in bankruptcy	Other (1)	Total
Commercial	1	—	—	1
Owner-occupied commercial	1	—	—	1
Construction	2	—	—	2
Residential	—	1	—	1
Consumer	—	6	1	7
	4	7	1	12

⁽¹⁾  Other includes underwriting exception.

Principal balances are generally not forgiven when a loan is modified as a TDR. Nonaccruing restructured loans remain in nonaccrual status until there has been a period of sustained repayment performance, typically six months and payment is reasonably assured.

The following table presents loans identified as TDRs during the three months endedMarch 31, 2017 and 2016.

	Three Months Ended March 31,
	2017				2016
(Dollars in thousands)	Pre Modification		Post Modification		Pre Modification		Post Modification
Commercial	$	443	$	443	$	984	$	984
Owner-occupied commercial	3,071		3,071		—		—
Commercial mortgages	—		—		—		—
Construction	1,712		1,712		—		—
Residential	242		242		614		614
Consumer	584		584		215		215
Total	$	6,052	$	6,052	$	1,813	$	1,813

During the three months endedMarch 31, 2017, the TDRs set forth in the table above increased our allowance for loan losses less than $0.3 million, and resulted in no additional charge-offs. For the same period of 2016, the TDRs set forth in the table above had no change on our allowance for loan losses allocation of the related reserve and resulted in charge-offs of less than $0.1 million. During the three months ended March 31, 2017, three TDRs defaulted that had received troubled debt modification during the past twelve months with a total loan amount $0.7 million.

XML

Goodwill and Intangibles

3 Months Ended

Mar. 31, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangibles

GOODWILL AND INTANGIBLES

In accordance with FASB ASC 805, Business Combinations (ASC 805) and FASB ASC 350, Intangibles-Goodwill and Other (ASC 350), all assets and liabilities acquired in purchase acquisitions, including goodwill, indefinite-lived intangibles and other intangibles are recorded at fair value.

During the three months ended March 31, 2017, we determined there were no events or other indicators of impairment as it relates to goodwill or other intangibles.

The following table shows the changes in our goodwill during the quarter as well as the allocation of goodwill to our reportable operating segments for purposes of goodwill impairment testing:

	WSFS			Cash		Wealth		Consolidated
(Dollars in thousands)	Bank			Connect		Management		Company
December 31, 2016	$	147,396		$	—	$	20,143	$	167,539
Remeasurement adjustments	(1,635		)	—		56		(1,579		)
Goodwill from business combinations	—			—		—		—
March 31, 2017	$	145,761		$	—	$	20,199	$	165,960

ASC 350 also requires that an acquired intangible asset be separately recognized if the benefit of the intangible asset is obtained through contractual or other legal rights, or if the asset can be sold, transferred, licensed, rented or exchanged, regardless of the acquirer’s intent to do so.

The following tables summarize other intangible assets:

	March 31, 2017
(Dollars in thousands)	Gross Intangible Assets		Accumulated Amortization			Net Intangible Assets		Amortization Period
Core deposits	$	10,658	$	(3,440	)	$	7,218	10 years
Customer relationships	17,561		(3,013		)	14,548		7-15 years
Non-compete agreements	221		(24		)	197		5 years
Loan servicing rights	1,821		(1,092		)	729		10-30 years
Favorable lease asset	1,932		(212		)	1,720		10 months-18 years
Total intangible assets	$	32,193	$	(7,781	)	$	24,412

	December 31, 2016
(Dollars in thousands)	Gross Intangible Assets		Accumulated Amortization			Net Intangible Assets		Amortization Period
Core deposits	$	13,128	$	(5,630	)	$	7,498	10 years
Customer relationships	17,561		(2,612		)	14,949		7-15 years
Non-compete agreements	1,006		(728		)	278		6 months- 5 years
Loan servicing rights	1,708		(1,067		)	641		10-30 years
Favorable lease asset	458		(116		)	342		10 months-15 years
Total intangible assets	$	33,861	$	(10,153	)	$	23,708

Core deposits are amortized over their expected lives using the present value of the benefit of the core deposits and either accelerated or straight-line methods of amortization. During the three months ended March 31, 2017, we recognized amortization expense on other intangible assets of $0.9 million.

The following table shows the estimated future amortization expense related to our intangible assets:

(Dollars in thousands)	Amortization of Intangibles
Remaining in 2017	$	2,287
2018	2,965
2019	2,897
2020	2,701
2021	2,329
Thereafter	11,233
Total	$	24,412

XML

Associate Benefit Plans

3 Months Ended

Mar. 31, 2017

Postemployment Benefits [Abstract]

Associate Benefit Plans

ASSOCIATE BENEFIT PLANS

Postretirement Medical Benefits

We share certain costs of providing health and life insurance benefits to eligible retired Associates (employees) and their eligible dependents. Previously, all Associates were eligible for these benefits if they reached normal retirement age while working for us. Effective March 31, 2014, we changed the eligibility of this plan to include only those Associates who have achieved ten years of service with us as of March 31, 2014. As of December 31, 2014, we began to use the mortality table issued by the Office of the Actuary of the U.S. Bureau of Census in October 2014 in our calculation.

We account for our obligations under the provisions of FASB ASC 715, Compensation - Retirement Benefits (ASC 715). ASC 715 requires that we recognize the costs of these benefits over an Associate’s active working career. Amortization of unrecognized net gains or losses resulting from experience different from that assumed and from changes in assumptions is included as a component of net periodic benefit cost over the remaining service period of active employees to the extent that such gains and losses exceed 10% of the accumulated postretirement benefit obligation, as of the beginning of the year.

The following are disclosures of the net periodic benefit cost components of postretirement medical benefits measured at January 1, 2017 and 2016.

	Three months ended March 31,
(Dollars in thousands)	2017			2016
Service cost	$	15		$	15
Interest cost	19			19
Prior service cost amortization	(19		)	(7		)
Net gain recognition	(16		)	(15		)
Net periodic benefit cost	$	(1	)	$	12

Alliance Associate Pension Plan

During the fourth quarter of 2015, we completed the acquisition of Alliance and its wholly owned subsidiary, Alliance Bank, headquartered in Broomall, Pennsylvania. At the time of the acquisition we assumed the Alliance pension plan offered to its current associates.

The following table shows the net periodic benefit cost components for the Alliance Associate Pension Plan benefits measured at January 1, 2017.

(Dollars in thousands)	Three months ended March 31, 2017
Service cost	$	10
Interest cost	75
Expected Return on Plan Assets	(135		)
Prior service cost amortization	—
Net gain recognition	—
Net periodic benefit cost	$	(50	)

XML

Income Taxes

3 Months Ended

Mar. 31, 2017

Income Tax Disclosure [Abstract]

Income Taxes

INCOME TAXES

We account for income taxes in accordance with FASB ASC 740, Income Taxes (ASC 740). ASC 740 requires the recording of deferred income taxes that reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. We exercise significant judgment in the evaluation of the amount and timing of the recognition of the resulting tax assets and liabilities. The judgments and estimates required for the evaluation are updated based on changes in business factors and the tax laws. If actual results differ from the assumptions and other considerations used in estimating the amount and timing of tax recognized, there can be no assurance that additional expenses will not be required in future periods.

ASC 740 prescribes a minimum probability threshold that a tax position must meet before a financial statement benefit is recognized. We recognize, when applicable, interest and penalties related to unrecognized tax benefits in the provision for income taxes in the financial statements. Assessment of uncertain tax positions under ASC 740 requires careful consideration of the technical merits of a position based on our analysis of tax regulations and interpretations.

There were no unrecognized tax benefits as of March 31, 2017. We record interest and penalties on potential income tax deficiencies as income tax expense. Our federal and state tax returns for the 2013 through 2016 tax years are subject to examination as of March 31, 2017. We do not expect to record or realize any material unrecognized tax benefits during 2017.

As a result of the adoption of ASU No. 2014-01, “Investments-Equity Method and Joint Ventures: Accounting for Investments in Qualified Affordable Housing Projects,” the amortization of our low-income housing credit investments has been reflected as income tax expense. Accordingly, $0.4 million of such amortization has been reflected as income tax expense for the three months ended March 31, 2017 compared to $0.4 million for the same period in 2016.

The amount of affordable housing tax credits, amortization and tax benefits recorded as income tax expense for the three months ended March 31, 2017 were $0.4 million, $0.4 million and $0.1 million, respectively. The carrying value of the investment in affordable housing credits is $15.0 million at March 31, 2017, compared to $15.4 million at December 31, 2016.

XML

Stock-Based Compensation

3 Months Ended

Mar. 31, 2017

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-Based Compensation

STOCK-BASED COMPENSATION

Stock-based compensation is accounted for in accordance with FASB ASC 718, Stock Compensation. Compensation expense relating to all share-based payments is recognized on a straight-line basis over the applicable vesting period. Our Stock Incentive Plans provide for the granting of stock options, stock appreciation rights, performance awards, restricted stock and restricted stock unit awards, deferred stock units, and other awards that are payable in or valued by reference to our common shares. The number of shares reserved for issuance under our 2013 Incentive Plan (2013 Plan) is 2,096,535. At March 31, 2017, there were 490,926 shares available for future grants under the 2013 Plan.

We record stock-based compensation expense related to awards granted to Associates in Salaries, benefits and other compensation; expense related to awards granted to directors is recorded in Other operating expense in our Consolidated Statements of Income. Total stock-based compensation expense recognized during the three months endedMarch 31, 2017 and 2016 was $0.9 million ($0.6 million after tax) and $0.8 million ($0.4 million after tax), respectively.

Stock Options

Stock options are granted with an exercise price not less than the fair market value of our common stock on the date of the grant. All stock options are to be granted at not less than the fair market value of our common stock on the date of the grant. All stock options granted during 2017 and 2016 vest in 25% per annum increments, start to become exercisable one year from the grant date and expire seven years from the grant date. Generally, all awards become exercisable immediately in the event of a change in control, as defined within the Stock Incentive Plans. We issue new shares upon the exercise of options.

We determine the grant date fair value of stock options using the Black-Scholes option-pricing model. The model requires the use of numerous assumptions, many of which are subjective. The expected term was derived from historical exercise patterns and represents the amount of time that stock options granted are expected to be outstanding. Other significant assumptions to determine 2017 and 2016 grant date fair value included volatility measured using the fluctuation in month end closing stock prices over a period which corresponds with the average expected option life; a weighted-average risk-free rate of return (zero coupon treasury yield); and a dividend yield indicative of our current dividend rate

The following table summarizes the assumptions we used to value options issued during the three months ended March 31, 2017 and 2016:

	March 31, 2017		March 31, 2016
Expected Term (in years)	5.3		5.3
Volatility	24.85	%	29.60	%
Weighted-average risk free interest rate	1.95	%	1.24	%
Dividend Yield	0.6	%	0.8	%

The following table summarizes our stock option activity for the three months endedMarch 31, 2017.

	Three months ended March 31, 2017
	Shares			Weighted- Average Exercise Price
Stock Options:
Outstanding at beginning of period	1,547,980			17.83
Granted	45,134			47.05
Exercised	(117,612		)	15.47
Forfeited	(750		)	15.83
Outstanding at end of period	1,474,752			18.91
Nonvested at end of period	424,459			23.64
Exercisable at end of period	1,050,293			17.00
Weighted-average fair value of options granted	$	11.50

The following table provides information about our nonvested stock options outstanding at March 31, 2017:

	March 31, 2017
	Shares			Weighted- Average Exercise Price
Stock Options:
Nonvested at beginning of period	$	704,421		$	19.08
Granted	45,134			47.05
Forfeited	(750		)	15.83
Vested during period	(324,346		)	17.01
Nonvested at end of period	$	424,459		23.64

The total amount of unrecognized compensation cost related to nonvested stock options as of March 31, 2017 was $5.5 million. The weighted-average period over which the expense is expected to be recognized is 1.86 years. During the first quarter of 2017, we recognized $0.5 million of compensation expense related to these awards.

Restricted Stock Units

Restricted stock units (RSUs) are granted at no cost to the recipient and generally vest over a four year period. All outstanding awards granted to senior executives vest over no less than a four year period. The 2013 Plan allows for awards with vesting periods less than four years subject to Board approval. The fair value of RSUs is equal to the fair value of the Company’s common stock on the date of grant. We recognize the expense related to RSUs granted to Associates in Salaries, benefits and other compensation expense; expense related to awards granted to directors is recorded in Other operating expense in our Statements of Income on an accrual basis over the requisite service period for the entire award.

The Long-Term Performance-Based Restricted Stock Unit program (Long-Term Program) provided for awards up to an aggregate of 233,400 RSUs to participants, only after the achievement of targeted levels of return on assets (ROA) in any year through 2013. During 2013, the Company achieved the 1.00% ROA performance level. In accordance with the Long-Term Program, the Company issued 108,456 RSUs to the plan’s participants in 2014. The RSUs vest in 25% increments over four years and we recognize expense over the implicit service period associated with the performance condition. During the first quarter of 2017, we recognized $0.1 of compensation expense related to this program.

The following table summarizes the Company’s RSAs and RSUs, including performance awards, and changes during the three months ended March 31, 2017:

	Three months ended March 31, 2017
	Units (in whole)			Weighted Average Grant-Date Fair Value per Unit
Outstanding at beginning of period	$	135,592		$	27.14
Granted	36,523			47.05
Vested	(33,803		)	20.22
Forfeited	(1,823		)	27.21
Outstanding at end of period	$	136,489		34.20

The total amount of compensation cost to be recognized relating to non-vested restricted stock, including performance awards, as of March 31, 2016, was $7.0 million. The weighted-average period over which the expense is expected to be recognized is 3.2 years. During the three months endedMarch 31, 2017, we recognized $0.2 million of compensation cost related to these awards.

XML

Fair Value Disclosures of Financial Assets and Liabilities

3 Months Ended

Mar. 31, 2017

Fair Value Disclosures [Abstract]

Fair Value Disclosures of Financial Assets and Liabilities

FAIR VALUE DISCLOSURES OF FINANCIAL ASSETS AND LIABILITIES

FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES

ASC 820-10 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820-10 establishes a fair value hierarchy that prioritizes the use of inputs used in valuation methodologies into the following three levels:

• Level 1: Inputs to the valuation methodology are quoted prices, unadjusted, for identical assets or liabilities in active markets. A quoted price in an active market provides the most reliable evidence of fair value and shall be used to measure fair value whenever available.

• Level 2: Inputs to the valuation methodology include quoted prices for similar assets or liabilities in active markets; inputs to the valuation methodology include quoted prices for identical or similar assets or liabilities in markets that are not active; or inputs to the valuation methodology that are derived principally from or can be corroborated by observable market data by correlation or other means.

• Level 3: Inputs to the valuation methodology are unobservable and significant to the fair value measurement. Level 3 assets and liabilities include financial instruments whose value is determined using discounted cash flow methodologies, as well as instruments for which the determination of fair value requires significant management judgment or estimation.

The following tables present financial instruments carried at fair value as of March 31, 2017 and December 31, 2016 by level in the valuation hierarchy (as described above):

	March 31, 2017
(Dollars in thousands)	Quoted Prices in Active Markets for Identical Asset (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Fair Value
Assets measured at fair value on a recurring basis:
Available-for-sale securities:
CMO	$	—	$	277,711	$	—	$	277,711
FNMA MBS	—		386,051		—		386,051
FHLMC MBS	—		64,171		—		64,171
GNMA MBS	—		27,597		—		27,597
GSE	—		32,981		—		32,981
Other investments	614		—		—		614
Other assets	—		1,108		—		1,108
Total assets measured at fair value on a recurring basis	$	614	$	789,619	$	—	$	790,233
Liabilities measured at fair value on a recurring basis:
Other liabilities	$	—	$	3,194	$	—	$	3,194
Assets measured at fair value on a nonrecurring basis:
Other real estate owned	$	—	$	—	$	3,582	$	3,582
Loans held for sale	—		29,394		—		29,394
Impaired loans, net	—		—		62,443		62,443
Total assets measured at fair value on a nonrecurring basis	$	—	$	29,394	$	66,025	$	95,419

	December 31, 2016
(Dollars in thousands)	Quoted Prices in Active Markets for Identical Asset (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Fair Value
Assets measured at fair value on a recurring basis:
Available-for-sale securities:
CMO	$	—	$	261,215	$	—	$	261,215
FNMA MBS	—		405,764		—		405,764
FHLMC MBS	—		63,515		—		63,515
GNMA MBS	—		28,416		—		28,416
GSE	—		35,010		—		35,010
Other investments	623		—		—		623
Other assets	—		1,508		—		1,508
Total assets measured at fair value on a recurring basis	$	623	$	795,428	$	—	$	796,051
Liabilities measured at fair value on a recurring basis:
Other liabilities	—		3,380		—		3,380
Assets measured at fair value on a nonrecurring basis
Other real estate owned	—		—		3,591		3,591
Loans held for sale	—		54,782		—		54,782
Impaired loans, net	—		—		46,499		46,499
Total assets measured at fair value on a nonrecurring basis	$	—	$	54,782	$	50,090	$	104,872

There were no transfers between Level 1 and Level 2 of the fair value hierarchy during the three months ending March 31, 2017.

Fair value is based on quoted market prices, where available. If such quoted market prices are not available, fair value is based on internally developed models or obtained from third parties that primarily use, as inputs, observable market-based parameters. Valuation adjustments may be made to ensure that financial instruments are recorded at fair value. These adjustments may include unobservable parameters. Our valuation methodologies may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. While we believe our valuation methodologies are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different estimate of fair value at the reporting date.

Available-for-sale securities

As of March 31, 2017, securities classified as available-for-sale are reported at fair value using Level 2 inputs, except for one mutual fund asset acquired as part of the Penn Liberty acquisition, which is categorized as Level 1. Included in the Level 2 total are approximately $33.0 million in U.S. Treasury Notes and Federal Agency debentures, and $755.5 million in Federal Agency MBS. We believe that this Level 2 designation is appropriate for these securities under ASC 820-10 as, with almost all fixed income securities, none are exchange traded, and all are priced by correlation to observed market data. For these securities we obtain fair value measurements from an independent pricing service. The fair value measurements consider observable data that may include dealer quotes, market spreads, cash flows, U.S. government and agency yield curves, live trading levels, trade execution data, market consensus prepayment speeds, credit information, and the security’s terms and conditions, among other factors.

Other real estate owned

Other real estate owned consists of loan collateral which has been repossessed through foreclosure or other measures. Initially, foreclosed assets are recorded at the lower of the loan balance or fair value of the collateral less estimated selling costs. Subsequent to foreclosure, valuations are updated periodically and the assets may be marked down further, reflecting a new cost basis. The fair value of our real estate owned was estimated using Level 3 inputs based on appraisals obtained from third parties.

Loans held for sale

The fair value of our loans held for sale is based on estimates using Level 2 inputs. These inputs are based on pricing information obtained from secondary markets and brokers and applied to loans with similar interest rates and maturities.

Impaired loans

We evaluate and value impaired loans at the time the loan is identified as impaired, and the fair values of such loans are estimated using Level 3 inputs in the fair value hierarchy. Each loan’s collateral has a unique appraisal and management’s discount of the value is based on the factors unique to each impaired loan. The significant unobservable input in determining the fair value is management’s subjective discount on appraisals of the collateral securing the loan, which range from 10% - 50%. Collateral may consist of real estate and/or business assets including equipment, inventory and/or accounts receivable and the value of these assets is determined based on the appraisals by qualified licensed appraisers hired by us. Appraised and reported values may be discounted based on management’s historical knowledge, changes in market conditions from the time of valuation, estimated costs to sell, and/or management’s expertise and knowledge of the client and the client’s business.

The gross amount of impaired loans, which are measured for impairment by either calculating the expected future cash flows discounted at the loan’s effective interest rate or determining the fair value of the collateral for collateral dependent loans was $67.7 million and $51.6 million at March 31, 2017 and December 31, 2016, respectively. The valuation allowance on impaired loans was $5.3 million as of March 31, 2017 and $3.4 million as of December 31, 2016.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The reported fair values of financial instruments are based on a variety of factors. In certain cases, fair values represent quoted market prices for identical or comparable instruments. In other cases, fair values have been estimated based on assumptions regarding the amount and timing of estimated future cash flows that are discounted to reflect current market rates and varying degrees of risk. Accordingly, the fair values may not represent actual values of the financial instruments that could have been realized as of period-end or that will be realized in the future.

The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate that value:

Cash and cash equivalents

For cash and short-term investment securities, including due from banks, federal funds sold or purchased under agreements to resell and interest-bearing deposits with other banks, the carrying amount is a reasonable estimate of fair value.

Investment securities

Fair value is estimated using quoted prices for similar securities, which we obtain from a third party vendor. We utilize one of the largest providers of securities pricing to the industry and management periodically assesses the inputs used by this vendor to price the various types of securities owned by us to validate the vendor’s methodology.

Loans held for sale

Loans held for sale are carried at their fair value (see discussion in “Fair Value of Financial Assets and Liabilities” section above).

Loans

Fair values are estimated for portfolios of loans with similar financial characteristics. Loans are segregated by type: commercial, commercial mortgages, owner-occupied commercial, construction, residential mortgages and consumer. For loans that reprice frequently, the book value approximates fair value. The fair values of other types of loans, with the exception of reverse mortgages, are estimated by discounting expected cash flows using the current rates at which similar loans would be made to borrowers with comparable credit ratings and for similar remaining maturities. The fair values of reverse mortgages are based on the net present value of the expected cash flows using a discount rate specific to the reverse mortgages portfolio. The fair value of nonperforming loans is based on recent external appraisals of the underlying collateral. Estimated cash flows, discounted using a rate commensurate with current rates and the risk associated with the estimated cash flows, are utilized if appraisals are not available. This technique does not contemplate an exit price.

Stock in the Federal Home Loan Bank (FHLB) of Pittsburgh

The fair value of FHLB stock is assumed to be equal to its cost basis, since the stock is non-marketable but redeemable at its par value.

Other assets

Other assets includes, among others, other real estate owned (see discussion earlier in this note) and our investment in Visa Class B stock. Our ownership includes shares acquired at no cost from our prior participation in Visa’s network, while Visa operated as a cooperative. During 2016 and 2017 we purchased additional shares which are accounted for as non-marketable equity securities and carried at cost. We evaluated the shares carried at cost for OTTI as of March 31, 2017, and the evaluation showed no OTTI as of March 31, 2017. Following resolution of Visa’s covered litigation, shares of Visa’s Class B stock will be converted to Visa Class A shares.

While only current owners of Class B shares are allowed to purchase other Class B shares, there have been several transactions between Class B shareholders. Based on these transactions we estimate the value of our Visa Class B shares to be $23.1 million as of March 31, 2017.

Deposits

The fair value of deposits with no stated maturity, such as noninterest-bearing demand deposits, money market and interest-bearing demand deposits, is assumed to be equal to the amount payable on demand. The fair value of time deposits is based on the discounted value of contractual cash flows. The discount rate is estimated using rates currently offered for deposits with comparable remaining maturities.

Borrowed funds

Rates currently available to us for debt with similar terms and remaining maturities are used to estimate fair value of existing debt.

Other Liabilities

Other liabilities includes cash flow derivatives and derivative on the residential mortgage held for sale pipeline.

Off-balance sheet instruments

The fair value of off-balance sheet instruments, including commitments to extend credit and standby letters of credit, approximates the recorded net deferred fee amounts, which are not significant. Because commitments to extend credit and letters of credit are generally not assignable by either us or the borrower, they only have value to us and the borrower.

The book value and estimated fair value of our financial instruments are as follows:

(Dollars in thousands)	Fair Value	March 31, 2017				December 31, 2016
	Measurement	Book Value		Fair Value		Book Value		Fair Value
Financial assets:
Cash and cash equivalents	Level 1	$	855,263	$	855,263	$	821,923	$	821,923
Investment securities available for sale	See previous table	789,125		789,125		794,543		794,543
Investment securities held to maturity	Level 2	163,611		163,241		164,346		163,232
Loans, held for sale	Level 2	29,394		29,394		54,782		54,782
Loans, net(1)(2)	Level 2, 3	4,489,708		4,450,924		4,397,876		4,300,963
Impaired loans, net	Level 3	62,443		62,443		46,499		46,499
Stock in FHLB of Pittsburgh	Level 2	20,002		20,002		38,248		38,248
Accrued interest receivable	Level 2	16,712		16,712		17,027		17,027
Other assets	Level 3	13,920		28,527		9,189		15,787
Financial liabilities:
Deposits	Level 2	5,376,830		5,040,211		4,738,438		4,423,921
Borrowed funds	Level 2	700,849		697,952		1,267,447		1,264,170
Standby letters of credit	Level 3	507		507		468		468
Accrued interest payable	Level 2	2,931		2,931		1,151		1,151
Other liabilities	Level 2	3,194		3,194		3,380		3,380

 ⁽¹⁾ Excludes impaired loans, net.

 ⁽²⁾ Includes reverse mortgage loans, which are categorized as Level 3.

At March 31, 2017 and December 31, 2016 we had no commitments to extend credit measured at fair value.

XML

Derivative Financial Instruments

3 Months Ended

Mar. 31, 2017

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments

DERIVATIVE FINANCIAL INSTRUMENTS

Risk Management Objective of Using Derivatives

We are exposed to certain risks arising from both our business operations and economic conditions. We principally manage our exposures to a wide variety of business and operational risks through management of our core business activities. We manage economic risks, including interest rate, liquidity, and credit risk, primarily by managing the amount, sources, and duration of our assets and liabilities. We manage a matched book with respect to our derivative instruments in order to minimize our net risk exposure resulting from such transactions.

Fair Values of Derivative Instruments

The table below presents the fair value of our derivative financial instruments as well as their location on the Consolidated Statements of Financial Condition as of March 31, 2017.

	Fair Values of Derivative Instruments
(Dollars in thousands)		Count	Notional		Balance Sheet Location	Liability Derivatives (Fair Value)
Derivatives designated as hedging instruments:
Interest rate products		3	$	75,000	Other Liabilities	$	3,039
Total derivatives designated as hedging instruments						$	3,039

Cash Flow Hedges of Interest Rate Risk

Our objectives in using interest rate derivatives are to add stability to interest expense and to manage our exposure to interest rate movements. To accomplish this objective, we primarily use interest rate swaps as part of our interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for us making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount.

The effective portion of changes in the fair value of derivatives designated and that qualify as cash flow hedges is recorded in accumulated other comprehensive income and is subsequently reclassified into earnings in the period that the hedged forecast transaction affects earnings. During the three months endedMarch 31, 2017, such derivatives were used to hedge the variable cash flows associated with a forecasted issuance of debt. The ineffective portion of the change in fair value of the derivatives is recognized directly in earnings. During the three months endedMarch 31, 2017, we did not record any hedge ineffectiveness.

Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on our variable-rate debt. During the next twelve months, we estimate that less than $0.1 million will be reclassified as an increase to interest expense.

We are hedging our exposure to the variability in future cash flows for forecasted transactions over a maximum period of 1 month (excluding forecasted transactions related to the payment of variable interest on existing financial instruments).

As of March 31, 2017, we had three outstanding interest rate derivatives with a notional of $75 million that were designated as cash flow hedges of interest rate risk.

Effect of Derivative Instruments on the Income Statement

The table below presents the effect of the derivative financial instruments on the Consolidated Statements of Income for the three months endedMarch 31, 2017 and March 31, 2016 .

(Dollars in thousands)	Amount of (Loss) or Gain Recognized in OCI on Derivative (Effective Portion)					Location of (Loss) or Gain Reclassified from Accumulated OCI into Income (Effective Portion)
	Three months ended March 31,
Derivatives in Cash Flow Hedging Relationships	2017			2016
Interest Rate Products	$	(3,039	)	$	—	Interest expense
Total	$	(3,039	)	$	—

Credit-risk-related Contingent Features

We have agreements with certain of our derivative counterparties that contain a provision where if we default on any of our indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, then we could also be declared in default on our derivative obligations.

We also have agreements with certain of our derivative counterparties that contain a provision where if we fail to maintain our status as a well/adequately capitalized institution, then the counterparty could terminate the derivative positions and we would be required to settle our obligations under the agreements.

As of March 31, 2017, the termination value of derivatives in a net liability position, which includes accrued interest but excludes any adjustment for nonperformance risk, related to these agreements was $3.0 million. We have minimum collateral posting thresholds with certain of our derivative counterparties, and have posted collateral of $3.4 million against our obligations under these agreements. If we had breached any of these provisions at March 31, 2017, we could have been required to settle our obligations under the agreements at the termination value.

XML

Segment Information

3 Months Ended

Mar. 31, 2017

Segment Reporting [Abstract]

Segment Information

SEGMENT INFORMATION

As defined in FASB ASC 280, Segment Reporting (ASC 280), an operating segment is a component of an enterprise that engages in business activities from which it may earn revenues and incur expenses, whose operating results are regularly reviewed by the enterprise’s chief operating decision makers to make decisions about resources to be allocated to the segment and assess its performance, and for which discrete financial information is available. We evaluate performance based on pretax ordinary income relative to resources used, and allocate resources based on these results. The accounting policies applicable to our segments are those that apply to our preparation of the accompanying unaudited Consolidated Financial Statements. Based on these criteria, we have identified three segments: WSFS Bank, Cash Connect^®, and Wealth Management.

The WSFS Bank segment provides financial products to commercial and retail customers. Retail and Commercial Banking, Commercial Real Estate Lending and other banking business units are operating departments of WSFS Bank. These departments share the same regulator, the same market, many of the same customers and provide similar products and services through the general infrastructure of the Bank. Accordingly, these departments are not considered discrete segments and are appropriately aggregated within the WSFS Bank segment in accordance with ASC 280.

Cash Connect^® provides ATM vault cash and smart safe and cash logistics services through strategic partnerships with several of the largest networks, manufacturers and service providers in the ATM industry. The balance sheet category “Cash in non-owned ATMs” includes cash from which fee income is earned through bailment arrangements with customers of Cash Connect^®.

The Wealth Management segment provides a broad array of fiduciary, investment management, credit and deposit products to clients through six business lines. WSFS Wealth Investments provides insurance and brokerage products primarily to our retail banking clients. Cypress Capital Management, LLC is a registered investment advisor. Cypress’ primary market segment is high net worth individuals, offering a ‘balanced’ investment style focused on preservation of capital and current income. West Capital Management, a registered investment advisor, is a fee-only wealth management firm which operates under a multi-family office philosophy and provides fully-customized solutions tailored to the unique needs of institutions and high net worth individuals. Christiana Trust provides fiduciary and investment services to personal trust clients, and trustee, agency, bankruptcy administration, custodial and commercial domicile services to corporate and institutional clients. Powdermill Financial Solutions is a multi-family office that specializes in providing unique, independent solutions to high net worth individuals, families and corporate executives through a coordinated, centralized approach. WSFS Private Banking serves high net worth clients by delivering credit and deposit products and partnering with other business units to deliver investment management and fiduciary products and services.

Segment information for the three months ended March 31, 2017 and 2016 is as follows:

	Three months ended March 31, 2017
(Dollars in thousands)	WSFS Bank		Cash Connect®		Wealth Management		Total
Statement of Income
External customer revenues:
Interest income	$	58,688	$	—	$	2,138	$	60,826
Noninterest income	10,167		9,677		8,248		28,092
Total external customer revenues	68,855		9,677		10,386		88,918
Inter-segment revenues:
Interest income	1,996		—		2,065		4,061
Noninterest income	2,164		191		36		2,391
Total inter-segment revenues	4,160		191		2,101		6,452
Total revenue	73,015		9,868		12,487		95,370
External customer expenses:
Interest expense	7,463		—		260		7,723
Noninterest expenses	38,960		6,135		6,411		51,506
Provision for loan losses	1,716		—		446		2,162
Total external customer expenses	48,139		6,135		7,117		61,391
Inter-segment expenses:
Interest expense	2,065		1,405		591		4,061
Noninterest expenses	227		715		1,449		2,391
Total inter-segment expenses	2,292		2,120		2,040		6,452
Total expenses	50,431		8,255		9,157		67,843
Income before taxes	$	22,584	$	1,613	$	3,330	$	27,527
Income tax provision							8,590
Consolidated net income							18,937
Capital expenditures	$	2,088	$	22	$	254	$	2,364

	March 31, 2017
(Dollars in thousands)	WSFS Bank		Cash Connect®		Wealth Management		Total
Statement of Financial Condition
Cash and cash equivalents	$	99,812	$	751,201	$	4,250	$	855,263
Goodwill	145,761		—		20,199		165,960
Other segment assets	5,608,912		4,097		218,667		5,831,676
Total segment assets	$	5,854,485	$	755,298	$	243,116	$	6,852,899

	Three months ended March 31, 2016
(Dollars in thousands)	WSFS Bank		Cash Connect®			Wealth Management			Total
Statement of Income
External customer revenues:
Interest income	$	48,038	$	—		$	2,008		$	50,046
Noninterest income	9,852		8,271		(r)	5,545			23,668
Total external customer revenues	57,890		8,271			7,553			73,714
Inter-segment revenues:
Interest income	1,061		—			1,895			2,956
Noninterest income	2,060		193			24			2,277
Total inter-segment revenues	3,121		193			1,919			5,233
Total revenue	61,011		8,464			9,472			78,947
External customer expenses:
Interest expense	4,497		—			193			4,690
Noninterest expenses	33,812		5,448		(r)	4,537			43,797
Provision for loan losses	815		—			(35		)	780
Total external customer expenses	39,124		5,448			4,695			49,267
Inter-segment expenses
Interest expense	1,895		555			506			2,956
Noninterest expenses	217		715			1,345			2,277
Total inter-segment expenses	2,112		1,270			1,851			5,233
Total expenses	41,236		6,718			6,546			54,500
Income before taxes	$	19,775	$	1,746		$	2,926		$	24,447
Income tax provision									8,677
Consolidated net income									15,770
Capital expenditures	$	1,211	$	20		$	2		$	1,233

	December 31, 2016
(Dollars in thousands)	WSFS Bank		Cash Connect®		Wealth Management		Total
Statement of Financial Condition
Cash and cash equivalents	$	100,893	$	717,643	$	3,387	$	821,923
Goodwill	147,396		—		20,143		167,539
Other segment assets	5,545,611		3,533		226,664		5,775,808
Total segment assets	$	5,793,900	$	721,176	$	250,194	$	6,765,270

^(r) Noninterest income and Noninterest expense for the period ended March 31, 2016 have been restated to correct an immaterial error related to revenue earned for cash servicing fees. See Note 1 - Basis of Presentation for further information.

XML

Indemnifications and Guarantees

3 Months Ended

Mar. 31, 2017

Commitments and Contingencies Disclosure [Abstract]

Indemnifications and Guarantees

INDEMNIFICATIONS AND GUARANTEES

Secondary Market Loan Sales

Given the current interest rate environment, coupled with our desire not to hold newly originated residential mortgage loans in our portfolio, we generally sell these assets in the secondary market to mortgage loan aggregators and on a more limited basis, to GSEs such as FHLMC, FNMA, and the FHLB. Loans held for sale are reflected on our unaudited Consolidated Statements of Financial Condition at fair value with changes in the value reflected in our unaudited Consolidated Statements of Income. Gains and losses are recognized at the time of sale. We periodically retain the servicing rights on residential mortgage loans sold which results in monthly service fee income. The mortgage servicing rights are included in our intangible assets in our unaudited Consolidated Statements of Financial Condition. Otherwise, we sell loans with servicing released on a nonrecourse basis. Rate-locked loan commitments that we intend to sell in the secondary market are accounted for as derivatives under ASC Topic 815, Derivatives and Hedging (ASC:815).

We generally do not sell loans with recourse, except for standard loan sale contract provisions covering violations of representations and warranties and, under certain circumstances, early payment default by the borrower. These are customary repurchase provisions in the secondary market for residential mortgage loan sales. These provisions may include either an indemnification from loss or the repurchase of the loans. Repurchases and losses have been rare and no provision is made for losses at the time of sale. There were no such repurchases for the three months ended March 31, 2017.

Swap Guarantees

We entered into agreements with three unrelated financial institutions whereby those financial institutions entered into interest rate derivative contracts (interest rate swap transactions) with customers referred to them by us. Under the terms of the agreements, those financial institutions have recourse to us for any exposure created under each swap transaction in the event that the customer defaults on the swap agreement and the agreement is in a paying position to the third-party financial institution. This is a customary arrangement that allows us to provide access to interest rate swap transactions for our customers without creating the swap ourselves. These swap guarantees are accounted for as credit derivatives. 

At both March 31, 2017 and December 31, 2016, there were 134 variable-rate to fixed-rate swap transactions between the third party financial institutions and our customers. The initial notional aggregate amount was approximately $538.7 million at March 31, 2017 compared to $518.8 million at December 31, 2016. At March 31, 2017 maturities ranged from under one year to twenty years. The aggregate market value of these swaps to the customers was a liability of $10.0 million at March 31, 2017 and $10.9 million at December 31, 2016. We had no reserves for the swap guarantees as of March 31, 2017.

XML

Change in Accumulated Other Comprehensive (Loss) Income

3 Months Ended

Mar. 31, 2017

Equity [Abstract]

Change in Accumulated Other Comprehensive (Loss) Income

CHANGE IN ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME

Accumulated other comprehensive (loss) income includes unrealized gains and losses on available-for-sale investments, unrealized gains and losses on cash flow hedges, as well as unrecognized prior service costs, transition costs, and actuarial gains and losses on defined benefit pension plans. Changes to accumulated other comprehensive (loss) income are presented net of tax as a component of stockholder's equity. Amounts that are reclassified out of accumulated other comprehensive (loss) income are recorded on the Consolidated Statement of Income either as a gain or loss.

Changes to accumulated other comprehensive (loss) income by component are shown net of taxes in the following tables for the period indicated:

(Dollars in thousands)	Net change  in investment securities available for sale			Net change in securities held to maturity			Net change in defined benefit plan			Net change in fair value of derivative used for cash flow hedge			Total
Balance, December 31, 2016	$	(8,194	)	$	1,392		$	957		$	(1,772	)	$	(7,617	)
Other comprehensive income (loss) before reclassifications	1,272			—			—			(112		)	1,160
Less: Amounts reclassified from accumulated other comprehensive loss	(206		)	(101		)	(23		)	—			(330		)
Net current-period other comprehensive income (loss)	1,066			(101		)	(23		)	(112		)	830
Balance, March 31, 2017	$	(7,128	)	$	1,291		$	934		$	(1,884	)	$	(6,787	)
Balance, December 31, 2015	$	(1,887	)	$	1,795		$	788		$	—		$	696
Other comprehensive income before reclassifications	10,572			—			—			—			10,572
Less: Amounts reclassified from accumulated other comprehensive income	(189		)	(103		)	478			—			186
Net current-period other comprehensive income (loss)	10,383			(103		)	478			—			10,758
Balance, March 31, 2016	$	8,496		$	1,692		$	1,266		$	—		$	11,454

The Consolidated Statements of Income were impacted by components of other comprehensive income (loss) as shown in the table below:

							Affected line item in
	Three Months Ended						Consolidated
(Dollars in thousands)	March 31,						Statements of Income
	2017			2016
Securities available for sale:
Realized gains on securities transactions	$	(320	)	$	(305	)	Security gains, net
Income taxes	114			116			Income tax provision
Net of tax	$	(206	)	$	(189	)
Net unrealized holding gains on securities transferred between available-for-sale and held-to-maturity:
Amortization of net unrealized gains to income during the period	$	(160	)	$	(168	)	Interest income on investment securities
Income taxes	59			65			Income tax provision
Net of tax	$	(101	)	$	(103	)
Amortization of Defined Benefit Pension items:
Prior service (credits) costs	$	(19	)	$	(7	)
Actuarial (gains) losses	(16		)	791
Total before tax	$	(35	)	$	784		Salaries, benefits and other compensation
Income taxes	12			(306		)	Income tax provision
Net of tax	(23		)	478
Total reclassifications	$	(330	)	$	186

XML

Related Party Transactions

3 Months Ended

Mar. 31, 2017

Related Party Transactions [Abstract]

Related Party Transactions

RELATED PARTY TRANSACTIONS

In the ordinary course of business, from time to time we enter into transactions with related parties, including, but not limited to, our officers and directors. These transactions are made on substantially the same terms and conditions, including interest rates and collateral requirements, as those prevailing at the same time for comparable transactions with other customers. They do not, in the opinion of management, involve greater than normal credit risk or include other unfavorable features.

The outstanding balances of loans to related parties at March 31, 2017 and December 31, 2016 were $1.6 million and $1.3 million, respectively. Total deposits from related parties at March 31, 2017 and December 31, 2016 were $6.3 million and $3.6 million, respectively. During the first quarter of 2017, new loans and credit line advances to related parties totaled $0.4 million and repayments were less than $0.1 million.

XML

Legal and Other Proceedings

3 Months Ended

Mar. 31, 2017

Commitments and Contingencies Disclosure [Abstract]

Legal and Other Proceedings

LEGAL AND OTHER PROCEEDINGS

In accordance with the current accounting standards for loss contingencies, we establish reserves for litigation-related matters that arise in the ordinary course of our business activities when it is probable that a loss associated with a claim or proceeding has been incurred and the amount of the loss can be reasonably estimated. Litigation claims and proceedings of all types are subject to many uncertain factors that generally cannot be predicted with assurance.

From time to time we are brought into certain legal matters and/or disputes through our Wealth Management segment, as a result of sometimes highly complex documents and servicing requirements that are part of this business. While the outcomes carry some degree of uncertainty, management does not currently anticipate that the ultimate liability, if any, arising out of such other proceedings we are aware of, will have a material effect on the Consolidated Financial Statements.

On April 7, 2015, WSFS Bank received a notice of arbitration and statement of claim (the Claim) from Universitas Education, LLC (Universitas) relating to Christiana Trust acting as “insurance trustee” of the Charter Oak Trust Welfare Benefit Plan (the Trust). The actions underlying the Claim occurred during a period prior to WSFS Corp’s acquisition of Christiana Trust. According to the allegations contained in the Claim, certain death benefits made payable to the asserted trustee of the Trust were misappropriated by individuals associated with that trustee and plan sponsor. None of those individuals, however, were employed by or agents of Christiana Trust or WSFS Bank. It also is alleged that Christiana Trust breached its fiduciary duty and engaged in fraud, negligence and statutory theft in connection with the disappearance of the misappropriated funds. It is further alleged that Universitas was the rightful beneficiary under the Trust of the misappropriated funds, and thus was harmed because it did not receive the death benefits that had been paid over to the asserted trustee of the Trust. The Claim subsequently was amended to add a count for breach of contract. The Claim seeks an award of approximately $30 million plus interest, as well as the costs incurred by Universitas in pursuing the Claim and statutory and other penalties. WSFS is vigorously defending itself against the Claim and believes that it has valid factual and legal defenses to the Claim. WSFS does not believe that the ultimate resolution of the Claim will have a material adverse effect on the Company, but there can be no assurance as to the ultimate outcome.

There were no material changes or additions to other significant pending legal or other proceedings involving us other than those arising out of routine operations.

XML

Basis of Presentation (Policies)

3 Months Ended

Mar. 31, 2017

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

General

Our unaudited Consolidated Financial Statements include the accounts of WSFS Financial Corporation (the Company, our Company, we, our or us), Wilmington Savings Fund Society, FSB (WSFS Bank or the Bank), WSFS Wealth Management, LLC (Powdermill), WSFS Capital Management, LLC (West Capital) and Cypress Capital Management, LLC (Cypress). We also have one unconsolidated subsidiary, WSFS Capital Trust III (the Capital Trust). WSFS Bank has three wholly-owned subsidiaries: WSFS Wealth Investments, 1832 Holdings, Inc. and Monarch Entity Services LLC (Monarch).

Overview

Founded in 1832, the Bank is one of the ten oldest bank and trust companies continuously operating under the same name in the United States (U.S.). We provide residential and commercial real estate, commercial and consumer lending services, as well as retail deposit and cash management services. Lending activities are funded primarily with customer deposits and borrowings. In addition, we offer a variety of wealth management and trust services to personal and corporate customers. The Federal Deposit Insurance Corporation (FDIC) insures our customers’ deposits to their legal maximums. We serve our customers primarily from our 77 offices located in Delaware (46), Pennsylvania (29), Virginia (1) and Nevada (1) and through our website at www.wsfsbank.com. Information on our website is not incorporated by reference into this quarterly report.

In preparing the unaudited Consolidated Financial Statements, we are required to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses. Amounts subject to significant estimates include the allowance for loan losses and reserves for lending related commitments, goodwill, intangible assets, post-retirement benefit obligations, the fair value of financial instruments, other-than-temporary impairment (OTTI), and the income tax valuation allowance. Among other effects, changes to these estimates could result in future impairments of investment securities, goodwill and intangible assets and establishment of the allowance and lending related commitments as well as increased post-retirement benefits expense.

Our accounting and reporting policies conform to Generally Accepted Accounting Principles (GAAP) in the U.S., prevailing practices within the banking industry for interim financial information and Rule 10-01 of SEC Regulation S-X (Rule 10-01). Rule 10-01 does not require us to include all information and notes that would be required in audited financial statements. Operating results for the periods presented are not necessarily indicative of the results that may be expected for any future quarters or for the year ending December 31, 2017. These unaudited, interim Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and related notes included in our 2016 Annual Report on Form 10-K that was filed with the SEC on March 1, 2017 and is available at www.sec.gov or on our website at http://investors.wsfsbank.com/financials.cfm. Whenever necessary, reclassifications have been made to the prior period Consolidated Financial Statements to conform to the current period’s presentation. All significant intercompany transactions were eliminated in consolidation.

The significant accounting policies used in preparation of our Consolidated Financial Statements are disclosed in our 2016 Annual Report on Form 10-K. There have not been any material changes in our significant accounting policies from those disclosed in our 2016 Annual Report on Form 10-K.

Acquisitions

Acquisitions in 2016

On August 12, 2016, we completed the acquisition of Penn Liberty Financial Corp. (Penn Liberty), a community bank headquartered in Wayne, Pennsylvania. We expect this acquisition to build our market share, deepen our presence in the southeastern Pennsylvania market, and enhance our customer base. The results of Penn Liberty’s operations are included in our Consolidated Financial Statements since the date of the acquisition. See Note 2 – Business Combinations for further information.

During the third and fourth quarters of 2016, respectively, we acquired the assets of Powdermill Financial Solutions LLC, a multi-family office serving an affluent clientele in the local community and throughout the U.S., and West Capital Management, Inc., an independent, fee-only wealth management firm providing fully customized solutions tailored to the unique needs of institutions and high net worth individuals which operates under a multi-family office philosophy. These acquisitions align with our strategic plan to expand our wealth management offerings and to diversify our fee-income generating businesses.

Recent Accounting Pronouncements

RECENT ACCOUNTING PRONOUNCEMENTS

Accounting Guidance Adopted in 2017

In March 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-05: Derivatives and Hedging (Topic 815): Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships, which amends Accounting Standards Codification (ASC) Topic 815: Derivatives and Hedging. This new guidance clarifies that the novation of a derivative contract (i.e., a change in the counterparty) in a hedge accounting relationship does not, in and of itself, cause a hedge accounting relationship to be discontinued because it does not represent a termination of the original derivative instrument or a change in the critical terms of the hedge relationship. This new guidance is effective for annual reporting periods beginning after December 15, 2016 and may be adopted prospectively or retroactively. Early adoption is permitted, including adoption in an interim period. The Company adopted this accounting guidance during the quarter ended March 31, 2017 with no impact to our Consolidated Financial statements, as the standard is applied on a prospective basis.

In March 2016, the FASB issued ASU No. 2016-06, Contingent Put and Call Options in Debt Instruments, Derivatives and Hedging (Topic 815). ASU 2016-06 clarifies that determining whether the economic characteristics of a put or call are clearly and closely related to its debt host requires only an assessment of the four-step decision sequence outlined in FASB ASC paragraph 815-15-25-24. Additionally, entities are not required to separately assess whether the contingency itself is clearly and closely related. The standard is effective for public business entities in interim and annual periods in fiscal years beginning after December 15, 2016. Early adoption is permitted in any interim period for which the entity’s financial statements have not been issued, but would be retroactively applied to the beginning of the year that includes the interim period. The standard requires a modified retrospective transition approach, with a cumulative catch-up adjustment to opening retained earnings in the period of adoption. For instruments that are eligible for the fair value option, an entity has a one-time option to irrevocably elect to measure the debt instrument affected by the standard in its entirety at fair value with changes in fair value recognized in earnings. The Company adopted this accounting guidance during the quarter ended March 31, 2017 with no impact on our Consolidated Statements of Income or Consolidated Statements of Financial Condition.

In March 2016, the FASB issued ASU No. 2016-07, Simplifying the Transition to the Equity Method of Accounting, Investments - Equity Method and Joint Ventures (Topic 323). ASU 2016-07 eliminates the requirement for an investor to retroactively apply the equity method when its increase in ownership interest (or degree of influence) in an investee triggers equity method accounting. The standard is effective for all entities in annual and interim periods in fiscal years beginning after December 15, 2016. Early adoption is permitted. The new guidance will be applied prospectively to changes in ownership (or influence) after the adoption date. The Company adopted this accounting guidance during the quarter ended March 31, 2017 with no impact to our Consolidated Financial statements, as the standard is applied on a prospective basis.

Accounting Guidance Pending Adoption at March 31, 2017

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606). This ASU supersedes the revenue recognition requirements in ASC 605, Revenue Recognition. ASU No. 2014-09 will require an entity to recognize revenue when it transfers promised goods or services to customers using a five-step model that requires entities to exercise judgment when considering the terms of the contracts. In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date. This amendment defers the effective date of ASU 2014-09 by one year. In March 2016, the FASB issued ASU 2016- 08, Principal versus Agent Considerations (Reporting Gross versus Net), which amends the principal versus agent guidance and clarifies that the analysis must focus on whether the entity has control of the goods or services before they are transferred to the customer. In addition, the FASB issued ASU Nos. 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers and 2016-12, Narrow-Scope Improvements and Practical Expedients, both of which provide additional clarification of certain provisions in Topic 606. These Accounting Standards Codification (“ASC”) updates are effective for public business entities in annual and interim reporting periods in fiscal years beginning after December 15, 2017. Early application is permitted for all entities, but not before annual reporting periods beginning after December 15, 2016. The standard permits the use of either the retrospective or retrospectively with the cumulative effect transition method. The Company is currently in the process of evaluating all revenue streams, accounting policies, practices and reporting to identify and understand any impact on the Company’s Consolidated Financial Statements. Our preliminary evaluation suggests that adoption of this guidance is not expected to have a material effect on our Consolidated Financial Statements. The Company anticipates completing our assessment in the second half of 2017.

In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments - Overall (Subtopic 825-10), Recognition and Measurement of Financial Assets and Financial Liabilities. This amendment requires that equity investments be measured at fair value with changes in fair value recognized in net income. When fair value is not readily determinable an entity may elect to measure the equity investment at cost, minus impairment, plus or minus any change in the investment’s observable price. For financial liabilities that are measured at fair value, the amendment requires an entity to present separately, in other comprehensive income, any change in fair value resulting from a change in instrument specific credit risk. ASU 2016-01 is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early adoption is permitted. Entities may apply this guidance on a prospective or retrospective basis. The Company does not expect the application of this guidance to have a material impact on its Consolidated Financial Statements.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). This ASU revises the accounting related to lessee accounting. Under the new guidance, lessees will be required to recognize a lease liability and a right-of-use asset for all leases. The new lease guidance also simplifies the accounting for sale and leaseback transactions primarily because lessees must recognize lease assets and lease liabilities. ASU 2016-02 is effective for the first interim period within annual periods beginning after December 15, 2018, with early adoption permitted. Adoption using the modified retrospective transition approach is required for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The Company is currently evaluating the impact of adopting ASU 2016-02 on its Consolidated Financial Statements.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326). ASU 2016-13 replaces the incurred loss impairment methodology in current GAAP with an expected credit loss methodology and requires consideration of a broader range of information to determine credit loss estimates. Financial assets measured at amortized cost will be presented at the net amount expected to be collected by using an allowance for credit losses. Purchased credit impaired loans will receive an allowance account at the acquisition date that represents a component of the purchase price allocation. Credit losses relating to available-for-sale debt securities will be recorded through an allowance for credit losses, with such allowance limited to the amount by which fair value is below amortized cost. This guidance is effective for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years. The Company is currently evaluating the impact of this guidance on its Consolidated Financial Statements.

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 represents the Emerging Issues Task Force’s (“the EITF”) final consensus on eight issues related to the classification of cash payments and receipts in the statement of cash flows for a number of common transactions. The consensus also clarifies when identifiable cash flows should be separated versus classified based on their predominant source or use. This guidance is effective for fiscal years beginning after December 15, 2017 and interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. The Company is currently evaluating the impact of this guidance on its Consolidated Financial Statements.

In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. ASU 2017-01 provides a new, two-step framework for determining whether a transaction is accounted for as an acquisition (or disposal) of assets or a business. The first step is evaluating whether substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets; if so, the transaction is not considered a business. Also, in order to be considered a business, the transaction would need to include an input and a substantive process that together significantly contribute to the ability to create outputs. The guidance is effective for public entities in annual and interim periods in fiscal years beginning after December 15, 2017. Early adoption is permitted for transactions that have not been reported in financial statements that have been issued or been made available for issuance. The Company does not expect the application of this guidance to have a material impact on its Consolidated Financial Statements.

In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. ASU 2017-04 simplifies the measurement of goodwill impairment by removing the hypothetical purchase price allocation (“Step 2”). The new guidance requires an impairment of goodwill be measured as the amount by which a reporting unit’s carrying value exceeds its fair value, up to the amount of goodwill recorded. The guidance is effective for public entities in annual and interim periods in fiscal years beginning after December 15, 2019. Early adoption is permitted for goodwill impairment tests with measurement dates after January 1, 2017. The Company does not expect the application of this guidance to have a material impact on its Consolidated Financial Statements.

In February 2017, the FASB issued ASU No. 2017-05, Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets. ASU 2017-05 provides clarification of the scope of ASC 610-20. Specifically, the new guidance clarifies that ASC 610-20 applies to nonfinancial assets which do not meet the definition of a business or not-for-profit activity. Further, the new guidance clarifies that a financial asset is within the scope of ASC 610-20 if it meets the definition of an in-substance nonfinancial asset which is defined as a financial asset promised to a counterparty in a contract where substantially all of the assets promised are nonfinancial. Finally, the new guidance clarifies that each distinct nonfinancial asset and in-substance nonfinancial asset should be derecognized when the counterparty obtains control of it. The guidance is effective for public entities in annual and interim reporting periods in fiscal years beginning after December 15, 2017. Early application is permitted for all entities, but not before annual reporting periods beginning after December 15, 2016. The Company is currently evaluating the impact of adopting ASU 2017-05 on its Consolidated Financial Statements.

In March 2017, the FASB issued ASU No. 2017-07, Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The new guidance requires that the service cost component of net periodic pension cost be disclosed with other compensation costs in the income statement. For all other cost components, an entity must either separately disclose the other cost components in separate line item(s) outside a subtotal of income from operations in the income statement or disclose the line item(s) used to present the other cost components in the income statement. The guidance is effective for public entities in annual and interim periods in fiscal years beginning after December 15, 2017. Early adoption is permitted. The Company does not expect the application of this guidance to have a material impact on its Consolidated Financial Statements.

In March 2017, the FASB issued ASU No. 2017-08, Premium Amortization on Purchased Callable Debt Securities. The new guidance requires the amortization period for certain non-contingent callable debt securities held at a premium to end at the earliest call date of the debt security. If the call option is not exercised at the earliest call date, the guidance requires the debt security's effective yield to be reset based on the contractual payment terms of the debt security. The guidance is effective for public entities in annual and interim periods in fiscal years beginning after December 15, 2018. Early adoption is permitted. Use of the modified retrospective method, with a cumulative-effect adjustment to retained earnings, is required. In the period of adoption, a change in accounting principle disclosure is required. The Company does not expect the application of this guidance to have a material impact on its Consolidated Financial Statements.

XML

Basis of Presentation Basis of Presentation (Tables)

3 Months Ended

Mar. 31, 2017

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Error Corrections and Prior Period Adjustments

As a result, the Consolidated Statement of Income has been revised to reflect these changes, as follows:

	Three months ended March 31, 2016
	As originally reported		Adjustments		As revised
Noninterest income - Other revenue	$	3,972	$	598	$	4,570
Noninterest expense - Other operating expense	7,061		598		7,659

XML

Business Combinations (Tables) - Penn Liberty Financial Corporation

3 Months Ended

Mar. 31, 2017

Business Acquisition [Line Items]

Summary of Consideration Paid and Fair Value of Identifiable Assets Acquired and Liabilities Assumed

In connection with the merger, the consideration transferred and the fair value of identifiable assets acquired and liabilities assumed, including remeasurement adjustments subsequent to the date of acquisition, are summarized in the following table:

(Dollars in thousands)	Fair Value
Consideration Transferred:
Common shares issued (1,806,748)	$	68,352
Cash paid to Penn Liberty stock and option holders	40,549
Value of consideration	108,901
Assets acquired:
Cash and due from banks	102,301
Investment securities	627
Loans	483,482
Premises and equipment	6,817
Deferred income taxes	6,542
Bank owned life insurance	8,666
Core deposit intangible	2,882
Other real estate owned	996
Other assets	12,092
Total assets	624,405
Liabilities assumed:
Deposits	568,706
Other borrowings	10,000
Other liabilities	3,977
Total liabilities	582,683
Net assets acquired:	41,722
Goodwill resulting from acquisition of Penn Liberty	$	67,179

Schedule of Change to Goodwill

The following table details the change to goodwill recorded subsequent to acquisition:

(Dollars in thousands)	Fair Value
Goodwill resulting from the acquisition of Penn Liberty reported as of December 31, 2016	$	68,814
Effects of adjustments to:
Deferred income taxes	880
Other assets	(1,447		)
Other liabilities	(1,068		)
Adjusted goodwill resulting from the acquisition of Penn Liberty as of March 31, 2017	$	67,179

XML

Earnings Per Share (Tables)

3 Months Ended

Mar. 31, 2017

Earnings Per Share [Abstract]

Computation of Basic and Diluted Earnings Per Share

The following table shows the computation of basic and diluted earnings per share:

	Three Months Ended March 31,
(Dollars and Shares in thousands, except per share data)	2017		2016
Numerator:
Net income	$	18,937	$	15,770
Denominator:
Weighted average basic shares	31,407		29,671
Dilutive potential common shares	942		558
Weighted average fully diluted shares	32,349		30,229
Earnings per share:
Basic	$	0.60	$	0.53
Diluted	$	0.59	$	0.52
Outstanding common stock equivalents having no dilutive effect	22		42

XML

Investment Securities (Tables)

3 Months Ended

Mar. 31, 2017

Investments, Debt and Equity Securities [Abstract]

Schedule of Amortized Cost and Estimated Fair Value of Available-for-Sale and Held-to-Maturity Investment Securities

The following tables detail the amortized cost and the estimated fair value of our available-for-sale and held-to-maturity investment securities. None of our investment securities are classified as trading.

(Dollars in thousands)	Amortized Cost		Gross Unrealized  Gain		Gross Unrealized  Loss		Fair Value
Available-for-Sale Securities:
March 31, 2017
GSE	$	33,051	$	2	$	72	$	32,981
CMO	280,576		699		3,564		277,711
FNMA MBS	393,356		984		8,289		386,051
FHLMC MBS	65,228		204		1,261		64,171
GNMA MBS	27,767		275		445		27,597
Other investments	634		—		20		614
	$	800,612	$	2,164	$	13,651	$	789,125
December 31, 2016
GSE	$	35,061	$	9	$	60	$	35,010
CMO	264,607		566		3,957		261,216
FNMA MBS	414,218		950		9,404		405,764
FHLMC MBS	64,709		135		1,330		63,514
GNMA MBS	28,540		303		427		28,416
Other investments	626		—		3		623
	$	807,761	$	1,963	$	15,181	$	794,543

(Dollars in thousands)	Amortized Cost		Gross Unrealized  Gain		Gross Unrealized  Loss		Fair Value
Held-to-Maturity Securities(1)
March 31, 2017
State and political subdivisions	$	163,611	$	646	$	1,016	$	163,241
December 31, 2016
State and political subdivisions	$	164,346	$	271	$	1,385	$	163,232

⁽¹⁾  Held-to–maturity securities transferred from available-for-sale are included in held-to-maturity at fair value at the time of transfer. The amortized cost of held-to-maturity securities included net unrealized gains of $2.1 million and $2.2 million at March 31, 2017 and December 31, 2016, respectively, related to securities transferred, which are offset in Accumulated Other Comprehensive Income, net of tax.

Schedule of Maturities of Investment Securities Available-for-Sale and Held-to-Maturity

The scheduled maturities of investment securities available for sale and held to maturity at March 31, 2017 and December 31, 2016 are presented in the table below:

	Available for Sale (1) (2)
	Amortized		Fair
(Dollars in thousands)	Cost		Value
March 31, 2017
Within one year	$	20,012	$	19,997
After one year but within five years	18,059		17,981
After five years but within ten years	210,595		205,242
After ten years	551,312		545,291
	$	799,978	$	788,511
December 31, 2016
Within one year	$	16,009	$	16,017
After one year but within five years	19,052		18,992
After five years but within ten years	276,635		270,300
After ten years	495,439		488,611
	$	807,135	$	793,920
	Held to Maturity (2)
	Amortized		Fair
(Dollars in thousands)	Cost		Value
March 31, 2017
Within one year	$	—	$	—
After one year but within five years	5,940		5,975
After five years but within ten years	10,482		10,511
After ten years	147,189		146,755
	$	163,611	$	163,241
December 31, 2016
Within one year	$	—	$	—
After one year but within five years	6,168		6,162
After five years but within ten years	8,882		8,870
After ten years	149,296		148,200
	$	164,346	$	163,232

 ⁽¹⁾ Included in the investment portfolio, but not in the table above, is a mutual fund with an amortized cost and fair value of $0.6 million as of March 31, 2017 and December 31, 2016 which has no stated maturity.

⁽²⁾  Actual maturities could differ

Schedule of Investment Securities' Gross Unrealized Losses and Fair Value by Investment Category

For investment securities with unrealized losses, the table below shows our gross unrealized losses and fair value by investment category and length of time that individual securities were in a continuous unrealized loss position at March 31, 2017.

	Duration of Unrealized Loss Position
	Less than 12 months				12 months or longer				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(Dollars in thousands)	Value		Loss		Value		Loss		Value		Loss
Available-for-sale securities:
GSE	$	25,981	$	72	$	—	$	—	$	25,981	$	72
CMO	161,225		3,469		4,239		95		165,464		3,564
FNMA MBS	276,175		8,289		—		—		276,175		8,289
FHLMC MBS	41,765		1,261		—		—		41,765		1,261
GNMA MBS	16,236		445		—		—		16,236		445
Other investments	634		20		—		—		634		20
Total temporarily impaired investments	522,016		13,556		4,239		95		526,255		13,651
	Less than 12 months				12 months or longer				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(Dollars in thousands)	Value		Loss		Value		Loss		Value		Loss
Held-to-maturity securities:
State and political subdivisions	$	84,121	$	969	$	1,960	$	47	$	86,081	$	1,016
Total temporarily impaired investments	$	84,121	$	969	$	1,960	$	47	$	86,081	$	1,016

For investment securities with unrealized losses, the table below shows our gross unrealized losses and fair value by investment category and length of time that individual securities were in a continuous unrealized loss position at December 31, 2016.

	Duration of Unrealized Loss Position
	Less than 12 months				12 months or longer				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(Dollars in thousands)	Value		Loss		Value		Loss		Value		Loss
Available-for-sale securities:
GSE	$	21,996	$	60	$	—	$	—	$	21,996	$	60
CMO	160,572		3,867		4,654		90		165,226		3,957
FNMA MBS	50,878		1,330		—		—		50,878		1,330
FHLMC MBS	300,403		9,404		—		—		300,403		9,404
GNMA MBS	16,480		427		—		—		16,480		427
Other investments	623		3		—		—		623		3
Total temporarily impaired investments	$	550,952	$	15,091	$	4,654	$	90	$	555,606	$	15,181
	Less than 12 months				12 months or longer				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(Dollars in thousands)	Value		Loss		Value		Loss		Value		Loss
Held-to-maturity securities:
State and political subdivisions	$	112,642	$	1,374	$	695	$	11	$	113,337	$	1,385
Total temporarily impaired investments	$	112,642	$	1,374	$	695	$	11	$	113,337	$	1,385

XML

Loans (Tables)

3 Months Ended

Mar. 31, 2017

Receivables [Abstract]

Summary of Loan Portfolio by Category

The following table shows our loan portfolio by category:

(Dollars in thousands)	March 31, 2017		December 31, 2016
Commercial and industrial	$	1,339,867	$	1,287,731
Owner-occupied commercial	1,092,292		1,078,162
Commercial mortgages	1,165,556		1,163,554
Construction	255,760		222,712
Residential (1)	281,760		289,611
Consumer	464,898		450,029
	4,600,133		4,491,799
Less:
Deferred fees, net	8,156		7,673
Allowance for loan losses	39,826		39,751
Net loans	$	4,552,151	$	4,444,375

⁽¹⁾ Includes Reverse Mortgages, at fair value of $22.5 million at March 31, 2017 and $22.6 million at December 31, 2016.

Schedule of Outstanding Principal Balance and Carrying Amounts for Acquired Credit-Impaired Loans

The following table shows the outstanding principal balance and carrying amounts for acquired credit impaired loans for which the Company applies ASC 310-30 as of the dates indicated:

(Dollars in thousands)	March 31, 2017		December 31, 2016
Outstanding principal balance	$	38,418	$	41,574
Carrying amount	30,783		33,104
Allowance for loan losses	464		510

Summary of Changes in Accretable Yield on Acquired Credit Impaired Loans

The following table presents the changes in accretable yield on the acquired credit impaired loans for the three months endedMarch 31, 2017:

(Dollars in thousands)	Three months ended March 31, 2017
Balance at beginning of period	$	5,150
Accretion	(792		)
Reclassification from nonaccretable difference	(144		)
Additions/adjustments	(112		)
Disposals	—
	$	4,102

XML

Allowance for Loan Losses and Credit Quality Information (Tables)

3 Months Ended

Mar. 31, 2017

Receivables [Abstract]

Schedule of Allowance for Loan Losses and Loan Balances

The following tables provide the activity of our allowance for loan losses and loan balances for the three months endedMarch 31, 2017:

	Three months ended March 31, 2017
(Dollars in thousands)	Commercial			Owner-occupied Commercial			Commercial Mortgages			Construction			Residential(1)			Consumer			Total
Allowance for loan losses
Beginning balance	$	13,339		$	6,588		$	8,915		$	2,838		$	2,059		$	6,012		$	39,751
Charge-offs	(1,255		)	(192		)	(104		)	(14		)	(11		)	(1,143		)	(2,719		)
Recoveries	84			75			46			2			120			305			632
Provision (credit)	1,949			(441		)	(518		)	158			(114		)	1,080			2,114
Provision for acquired loans	88			—			(4		)	(23		)	—			(13		)	48
Ending balance	$	14,205		$	6,030		$	8,335		$	2,961		$	2,054		$	6,241		$	39,826
Period-end allowance allocated to:
Loans individually evaluated for impairment	$	1,860		$	—		$	1,395		$	500		$	887		$	194		$	4,836
Loans collectively evaluated for impairment	12,165			6,015			6,763			2,397			1,144			6,042			34,526
Acquired loans evaluated for impairment	180			15			177			64			23			5			464
Ending balance	$	14,205		$	6,030		$	8,335		$	2,961		$	2,054		$	6,241		$	39,826
Period-end loan balances evaluated for:
Loans individually evaluated for impairment (2)	$	16,767		$	4,020		$	9,771		$	3,130		$	14,280		$	9,029		$	56,997
Loans collectively evaluated for impairment	1,175,911			919,508			928,925			225,718			158,430			405,285			3,813,777
Acquired nonimpaired loans	141,933			156,724			216,410			24,540			85,679			50,321			675,607
Acquired impaired loans	5,256			12,040			10,450			2,372			866			263			31,247
Ending balance (3)	$	1,339,867		$	1,092,292		$	1,165,556		$	255,760		$	259,255		$	464,898		$	4,577,628

⁽¹⁾  Period-end loan balance excludes Reverse Mortgages, at fair value of $22.5 million.

⁽²⁾  The difference between this amount and nonaccruing loans represents accruing troubled debt restructured loans of $17.3 million for the period ending March 31, 2017. Accruing troubled debt restructured loans are considered impaired loans.

⁽³⁾  Ending loan balances do not include net deferred fees.

The following table provides the activity of the allowance for loan losses and loan balances for the three months ended March 31, 2016:

	Three months ended March 31, 2016
(Dollars in thousands)	Commercial			Owner - occupied Commercial			Commercial Mortgages			Construction			Residential(1)			Consumer			Complexity Risk(2)		Total
Allowance for loan losses
Beginning balance	$	11,156		$	6,670		$	6,487		$	3,521		$	2,281		$	5,964		$	1,010	$	37,089
Charge-offs	(179		)	—			(17		)	(26		)	(14		)	(631		)	—		(867		)
Recoveries	110			38			79			46			22			259			—		554
Provision (credit)	484			(6		)	(37		)	72			(20		)	400			14		907
Provision for acquired loans	(89		)	—			4			(4		)	—			(38		)	—		(127		)
Ending balance	$	11,482		$	6,702		$	6,516		$	3,609		$	2,269		$	5,954		$	1,024	$	37,556
Period-end allowance allocated to:
Loans individually evaluated for impairment	$	1,473		$	—		$	—		$	211		$	911		$	208		$	—	$	2,803
Loans collectively evaluated for impairment	10,005			6,680			6,427			3,398			1,354			5,746			1,024		34,634
Acquired loans evaluated for impairment	4			22			89			—			4			—			—		119
Ending balance	$	11,482		$	6,702		$	6,516		$	3,609		$	2,269		$	5,954		$	1,024	$	37,556
Period-end loan balances:
Loans individually evaluated for impairment (3)	$	5,278		$	1,270		$	2,678		$	1,419		$	15,260		$	7,795		$	—	$	33,700
Loans collectively evaluated for impairment	957,863			839,819			893,036			194,654			161,610			336,053			—		3,383,035
Acquired nonimpaired loans	107,380			49,765			80,795			27,711			73,240			15,803			—		354,694
Acquired impaired loans	12,600			4,603			10,557			3,564			955			5			—		32,284
Ending balance (4)	$	1,083,121		$	895,457		$	987,066		$	227,348		$	251,065		$	359,656		$	—	$	3,803,713

⁽¹⁾  Period-end loan balance excludes Reverse Mortgages, at fair value of $24.7 million.

⁽²⁾  Represents the portion of the allowance for loan losses established to capture factors not already included in other components in our allowance for loan losses methodology.

⁽³⁾  The difference between this amount and nonaccruing loans represents accruing troubled debt restructured loans of $13.9 million for the period ending March 31, 2016. Accruing troubled debt restructured loans are considered impaired loans.

⁽⁴⁾  Ending loan balances do not include net deferred fees.

Summary of Nonaccrual and Past Due Loans

The following tables show our nonaccrual and past due loans at the dates indicated:

	March 31, 2017
(Dollars in thousands)	30–59 Days Past Due  and Still  Accruing			60–89 Days Past Due and Still  Accruing			Greater  Than 90 Days Past Due and Still Accruing			Total Past Due And Still Accruing			Accruing Current Balances			Acquired Impaired Loans			Nonaccrual Loans			Total Loans
Commercial	$	783		$	467		$	—		$	1,250		$	1,316,841		$	5,256		$	16,520		$	1,339,867
Owner-occupied commercial	341			500			—			841			1,075,391			12,040			4,020			1,092,292
Commercial mortgages	451			—			343			794			1,144,617			10,450			9,695			1,165,556
Construction	37			—			466			503			252,885			2,372			—			255,760
Residential(1)	2,020			119			850			2,989			250,443			866			4,957			259,255
Consumer	374			612			106			1,092			459,057			263			4,486			464,898
Total (2)	$	4,006		$	1,698		$	1,765		$	7,469		$	4,499,234		$	31,247		$	39,678		$	4,577,628
% of Total Loans	0.08		%	0.04		%	0.04		%	0.16		%	98.29		%	0.68		%	0.87		%	100		%

⁽¹⁾  Residential accruing current balances excludes Reverse Mortgages at fair value of $22.5 million.

⁽²⁾  The balances above include a total of $675.6 million of acquired nonimpaired loans.

	December 31, 2016
(Dollars in thousands)	30–59 Days Past Due  and Still  Accruing			60–89 Days Past Due  and Still  Accruing			Greater  Than 90 Days Past Due and Still Accruing			Total Past Due And Still Accruing			Accruing Current Balances			Acquired Impaired Loans			Nonaccrual Loans			Total Loans
Commercial	$	1,507		$	278		$	—		$	1,785		$	1,277,748		$	6,183		$	2,015		$	1,287,731
Owner-occupied commercial	116			540			—			656			1,063,306			12,122			2,078			1,078,162
Commercial mortgages	167			—			—			167			1,143,180			10,386			9,821			1,163,554
Construction	132			—			—			132			218,886			3,694			—			222,712
Residential(1)	3,176			638			153			3,967			257,234			860			4,967			267,028
Consumer	392			346			285			1,023			444,642			369			3,995			450,029
Total(2)	$	5,490		$	1,802		$	438		$	7,730		$	4,404,996		$	33,614		$	22,876		$	4,469,216
% of Total Loans	0.12		%	0.04		%	0.01		%	0.17		%	98.56		%	0.75		%	0.51		%	100		%

⁽¹⁾  Residential accruing current balances excludes Reverse Mortgages, at fair value of $22.6 million.

⁽²⁾  The balances above include a total of $724.1 million of acquired nonimpaired loans

Analysis of Impaired Loans

The following tables provide an analysis of our impaired loans at March 31, 2017 and December 31, 2016:

	March 31, 2017
(Dollars in thousands)	Ending Loan Balances		Loans with No Related Reserve (1)		Loans with Related Reserve		Related Reserve		Contractual Principal Balances		Average Loan Balances
Commercial	$	18,550	$	2,598	$	15,952	$	2,040	$	20,197	$	7,535
Owner-occupied commercial	6,210		4,020		2,190		15		6,372		4,155
Commercial mortgages	14,478		4,220		10,258		1,572		19,906		9,288
Construction	4,435		1,117		3,318		564		4,546		2,979
Residential	15,000		8,056		6,944		910		17,904		14,941
Consumer	9,070		7,526		1,544		199		11,578		8,191
Total (2)	$	67,743	$	27,537	$	40,206	$	5,300	$	80,503	$	47,089

⁽¹⁾  Reflects loan balances at or written down to their remaining book balance.

⁽²⁾  The above includes acquired impaired loans totaling $10.7 million in the ending loan balance and $11.8 million in the contractual principal balance.

	December 31, 2016
(Dollars in thousands)	Ending Loan Balances		Loans with No Related Reserve (1)		Loans with Related Reserve		Related Reserve		Contractual Principal Balances		Average Loan Balances
Commercial	$	4,250	$	1,395	$	2,855	$	505	$	5,572	$	5,053
Owner-occupied commercial	4,650		2,078		2,572		15		5,129		3,339
Commercial mortgages	15,065		4,348		10,717		1,433		20,716		7,323
Construction	3,662		—		3,662		303		3,972		2,376
Residential	14,256		7,122		7,134		934		17,298		15,083
Consumer	8,021		6,561		1,460		215		11,978		7,910
Total (2)	$	49,904	$	21,504	$	28,400	$	3,405	$	64,665	$	41,084

⁽¹⁾  Reflects loan balances at or written down to their remaining book balance.

⁽²⁾  The above includes acquired impaired loans totaling $12.8 million in the ending loan balance and $15.0 million in the contractual principal balance.

Schedule of Commercial Credit Exposure

The following tables provide an analysis of loans by portfolio segment based on the credit quality indicators used to determine the Allowance for Loan Loss.

Commercial Credit Exposure

	March 31, 2017
(Dollars in thousands)	Commercial		Owner-occupied Commercial		Commercial Mortgages		Construction		Total Commercial(1)
									Amount		%
Risk Rating:
Special mention	$	17,590	$	6,849	$	21,931	$	1,008	$	47,378
Substandard:
Accrual	41,136		20,162		3,216		4,489		69,003
Nonaccrual	14,660		4,020		8,300		—		26,980
Doubtful	1,860		—		1,395		—		3,255
Total Special Mention and Substandard	75,246		31,031		34,842		5,497		146,616		4	%
Acquired impaired	5,256		12,040		10,450		2,372		30,118		1	%
Pass	1,259,365		1,049,221		1,120,264		247,891		3,676,741		95	%
Total	$	1,339,867	$	1,092,292	$	1,165,556	$	255,760	$	3,853,475	100	%

⁽¹⁾  Table includes $539.6 million of acquired nonimpaired loans as of March 31, 2017.

	December 31, 2016
(Dollars in thousands)	Commercial		Owner-occupied Commercial		Commercial Mortgages		Construction		Total Commercial(1)
									Amount		%
Risk Rating:
Special mention	$	17,630	$	11,419	$	34,198	$	—	$	63,247
Substandard:
Accrual	45,067		19,871		239		2,193		67,370
Nonaccrual	1,693		2,078		8,574		—		12,345
Doubtful	322		—		1,247		—		1,569
Total Special Mention and Substandard	64,712		33,368		44,258		2,193		144,531		4	%
Acquired impaired	6,183		12,122		10,386		3,694		32,385		1	%
Pass	1,216,836		1,032,672		1,108,910		216,825		3,575,243		95	%
Total	$	1,287,731	$	1,078,162	$	1,163,554	$	222,712	$	3,752,159	100	%

⁽¹⁾  Table includes $573.5 million of acquired nonimpaired loans as of December 31, 2016.

Schedule of Consumer Credit Exposure

Residential and Consumer Credit Exposure

(Dollars in thousands)	Residential(2)				Consumer				Total Residential and Consumer(3)
	March 31,		December 31,		March 31,		December 31,		March 31, 2017				December 31, 2016
	2017		2016		2017		2016		Amount		Percent		Amount		Percent
Nonperforming(1)	$	14,280	$	13,547	$	9,030	$	7,863	$	23,310	3	%	$	21,410	3	%
Acquired impaired loans	866		860		263		369		1,129		—	%	1,229		—	%
Performing	244,109		252,621		455,605		441,797		699,714		97	%	694,418		97	%
Total	$	259,255	$	267,028	$	464,898	$	450,029	$	724,153	100	%	$	717,057	100	%

⁽¹⁾  Includes $13.7 million as of March 31, 2017 and $12.4 million as of December 31, 2016 of troubled debt restructured mortgages and home equity installment loans that are performing in accordance with the loans’ modified terms and are accruing interest.

⁽²⁾  Residential performing loans excludes $22.5 million and $22.6 million of Reverse Mortgages at fair value as of March 31, 2017 and December 31, 2016, respectively.

⁽³⁾  Total includes $136.0 million and $150.5 million in acquired nonimpaired loans as of March 31, 2017 and December 31, 2016, respectively.

Schedule of Loans Identified as Troubled Debt Restructurings During Periods Indicated

The following table presents loans identified as TDRs during the three months endedMarch 31, 2017 and 2016.

	Three Months Ended March 31,
	2017				2016
(Dollars in thousands)	Pre Modification		Post Modification		Pre Modification		Post Modification
Commercial	$	443	$	443	$	984	$	984
Owner-occupied commercial	3,071		3,071		—		—
Commercial mortgages	—		—		—		—
Construction	1,712		1,712		—		—
Residential	242		242		614		614
Consumer	584		584		215		215
Total	$	6,052	$	6,052	$	1,813	$	1,813

The following table presents information regarding the types of loan modifications made for the three months endedMarch 31, 2017:

(Dollars in thousands)	Maturity Date Extension	Discharged in bankruptcy	Other (1)	Total
Commercial	1	—	—	1
Owner-occupied commercial	1	—	—	1
Construction	2	—	—	2
Residential	—	1	—	1
Consumer	—	6	1	7
	4	7	1	12

⁽¹⁾  Other includes underwriting exception.

The following table presents the balance of TDRs as of the indicated dates:

(Dollars in thousands)	March 31, 2017		December 31, 2016
Performing TDRs	$	17,260	$	14,336
Nonperforming TDRs	10,778		8,451
Total TDRs	28,038		22,787

XML

Goodwill and Intangibles (Tables)

3 Months Ended

Mar. 31, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Allocation of Goodwill to Our Reportable Operating Segments for Purposes of Goodwill Impairment Testing

The following table shows the changes in our goodwill during the quarter as well as the allocation of goodwill to our reportable operating segments for purposes of goodwill impairment testing:

	WSFS			Cash		Wealth		Consolidated
(Dollars in thousands)	Bank			Connect		Management		Company
December 31, 2016	$	147,396		$	—	$	20,143	$	167,539
Remeasurement adjustments	(1,635		)	—		56		(1,579		)
Goodwill from business combinations	—			—		—		—
March 31, 2017	$	145,761		$	—	$	20,199	$	165,960

Summary of Other Intangible Assets

The following tables summarize other intangible assets:

	March 31, 2017
(Dollars in thousands)	Gross Intangible Assets		Accumulated Amortization			Net Intangible Assets		Amortization Period
Core deposits	$	10,658	$	(3,440	)	$	7,218	10 years
Customer relationships	17,561		(3,013		)	14,548		7-15 years
Non-compete agreements	221		(24		)	197		5 years
Loan servicing rights	1,821		(1,092		)	729		10-30 years
Favorable lease asset	1,932		(212		)	1,720		10 months-18 years
Total intangible assets	$	32,193	$	(7,781	)	$	24,412

	December 31, 2016
(Dollars in thousands)	Gross Intangible Assets		Accumulated Amortization			Net Intangible Assets		Amortization Period
Core deposits	$	13,128	$	(5,630	)	$	7,498	10 years
Customer relationships	17,561		(2,612		)	14,949		7-15 years
Non-compete agreements	1,006		(728		)	278		6 months- 5 years
Loan servicing rights	1,708		(1,067		)	641		10-30 years
Favorable lease asset	458		(116		)	342		10 months-15 years
Total intangible assets	$	33,861	$	(10,153	)	$	23,708

Schedule of Estimated Amortization Expense of Intangibles

The following table shows the estimated future amortization expense related to our intangible assets:

(Dollars in thousands)	Amortization of Intangibles
Remaining in 2017	$	2,287
2018	2,965
2019	2,897
2020	2,701
2021	2,329
Thereafter	11,233
Total	$	24,412

XML

Associate Benefit Plans (Tables)

3 Months Ended

Mar. 31, 2017

Postemployment Benefits [Abstract]

Schedule of Net Periodic Benefit Cost Components of Postretirement Benefits

The following are disclosures of the net periodic benefit cost components of postretirement medical benefits measured at January 1, 2017 and 2016.

	Three months ended March 31,
(Dollars in thousands)	2017			2016
Service cost	$	15		$	15
Interest cost	19			19
Prior service cost amortization	(19		)	(7		)
Net gain recognition	(16		)	(15		)
Net periodic benefit cost	$	(1	)	$	12

The following table shows the net periodic benefit cost components for the Alliance Associate Pension Plan benefits measured at January 1, 2017.

(Dollars in thousands)	Three months ended March 31, 2017
Service cost	$	10
Interest cost	75
Expected Return on Plan Assets	(135		)
Prior service cost amortization	—
Net gain recognition	—
Net periodic benefit cost	$	(50	)

XML

Stock-Based Compensation (Tables)

3 Months Ended

Mar. 31, 2017

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Summary of Assumptions for Options Issued

The following table summarizes the assumptions we used to value options issued during the three months ended March 31, 2017 and 2016:

	March 31, 2017		March 31, 2016
Expected Term (in years)	5.3		5.3
Volatility	24.85	%	29.60	%
Weighted-average risk free interest rate	1.95	%	1.24	%
Dividend Yield	0.6	%	0.8	%

Summary of Options Including Non-Plan Stock Options

The following table summarizes our stock option activity for the three months endedMarch 31, 2017.

	Three months ended March 31, 2017
	Shares			Weighted- Average Exercise Price
Stock Options:
Outstanding at beginning of period	1,547,980			17.83
Granted	45,134			47.05
Exercised	(117,612		)	15.47
Forfeited	(750		)	15.83
Outstanding at end of period	1,474,752			18.91
Nonvested at end of period	424,459			23.64
Exercisable at end of period	1,050,293			17.00
Weighted-average fair value of options granted	$	11.50

Schedule of Nonvested Stock Option Outstanding

The following table provides information about our nonvested stock options outstanding at March 31, 2017:

	March 31, 2017
	Shares			Weighted- Average Exercise Price
Stock Options:
Nonvested at beginning of period	$	704,421		$	19.08
Granted	45,134			47.05
Forfeited	(750		)	15.83
Vested during period	(324,346		)	17.01
Nonvested at end of period	$	424,459		23.64

Schedule of RSAs and RSUs

The following table summarizes the Company’s RSAs and RSUs, including performance awards, and changes during the three months ended March 31, 2017:

	Three months ended March 31, 2017
	Units (in whole)			Weighted Average Grant-Date Fair Value per Unit
Outstanding at beginning of period	$	135,592		$	27.14
Granted	36,523			47.05
Vested	(33,803		)	20.22
Forfeited	(1,823		)	27.21
Outstanding at end of period	$	136,489		34.20

XML

Fair Value Disclosures of Financial Assets and Liabilities (Tables)

3 Months Ended

Mar. 31, 2017

Fair Value Disclosures [Abstract]

Schedule of Financial Instruments Carried at Fair Value

The following tables present financial instruments carried at fair value as of March 31, 2017 and December 31, 2016 by level in the valuation hierarchy (as described above):

	March 31, 2017
(Dollars in thousands)	Quoted Prices in Active Markets for Identical Asset (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Fair Value
Assets measured at fair value on a recurring basis:
Available-for-sale securities:
CMO	$	—	$	277,711	$	—	$	277,711
FNMA MBS	—		386,051		—		386,051
FHLMC MBS	—		64,171		—		64,171
GNMA MBS	—		27,597		—		27,597
GSE	—		32,981		—		32,981
Other investments	614		—		—		614
Other assets	—		1,108		—		1,108
Total assets measured at fair value on a recurring basis	$	614	$	789,619	$	—	$	790,233
Liabilities measured at fair value on a recurring basis:
Other liabilities	$	—	$	3,194	$	—	$	3,194
Assets measured at fair value on a nonrecurring basis:
Other real estate owned	$	—	$	—	$	3,582	$	3,582
Loans held for sale	—		29,394		—		29,394
Impaired loans, net	—		—		62,443		62,443
Total assets measured at fair value on a nonrecurring basis	$	—	$	29,394	$	66,025	$	95,419

Book Value and Estimated Fair Value of Financial Instruments

The book value and estimated fair value of our financial instruments are as follows:

(Dollars in thousands)	Fair Value	March 31, 2017				December 31, 2016
	Measurement	Book Value		Fair Value		Book Value		Fair Value
Financial assets:
Cash and cash equivalents	Level 1	$	855,263	$	855,263	$	821,923	$	821,923
Investment securities available for sale	See previous table	789,125		789,125		794,543		794,543
Investment securities held to maturity	Level 2	163,611		163,241		164,346		163,232
Loans, held for sale	Level 2	29,394		29,394		54,782		54,782
Loans, net(1)(2)	Level 2, 3	4,489,708		4,450,924		4,397,876		4,300,963
Impaired loans, net	Level 3	62,443		62,443		46,499		46,499
Stock in FHLB of Pittsburgh	Level 2	20,002		20,002		38,248		38,248
Accrued interest receivable	Level 2	16,712		16,712		17,027		17,027
Other assets	Level 3	13,920		28,527		9,189		15,787
Financial liabilities:
Deposits	Level 2	5,376,830		5,040,211		4,738,438		4,423,921
Borrowed funds	Level 2	700,849		697,952		1,267,447		1,264,170
Standby letters of credit	Level 3	507		507		468		468
Accrued interest payable	Level 2	2,931		2,931		1,151		1,151
Other liabilities	Level 2	3,194		3,194		3,380		3,380

 ⁽¹⁾ Excludes impaired loans, net.

 ⁽²⁾

XML

Derivative Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2017

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Fair Values of Derivative Instruments

The table below presents the fair value of our derivative financial instruments as well as their location on the Consolidated Statements of Financial Condition as of March 31, 2017.

	Fair Values of Derivative Instruments
(Dollars in thousands)		Count	Notional		Balance Sheet Location	Liability Derivatives (Fair Value)
Derivatives designated as hedging instruments:
Interest rate products		3	$	75,000	Other Liabilities	$	3,039
Total derivatives designated as hedging instruments						$	3,039

Summary of Company's Derivative Financial Instruments

he table below presents the effect of the derivative financial instruments on the Consolidated Statements of Income for the three months endedMarch 31, 2017 and March 31, 2016 .

(Dollars in thousands)	Amount of (Loss) or Gain Recognized in OCI on Derivative (Effective Portion)					Location of (Loss) or Gain Reclassified from Accumulated OCI into Income (Effective Portion)
	Three months ended March 31,
Derivatives in Cash Flow Hedging Relationships	2017			2016
Interest Rate Products	$	(3,039	)	$	—	Interest expense
Total	$	(3,039	)	$	—

XML

Segment Information (Tables)

3 Months Ended

Mar. 31, 2017

Segment Reporting [Abstract]

Details of Segment Information

Segment information for the three months ended March 31, 2017 and 2016 is as follows:

	Three months ended March 31, 2017
(Dollars in thousands)	WSFS Bank		Cash Connect®		Wealth Management		Total
Statement of Income
External customer revenues:
Interest income	$	58,688	$	—	$	2,138	$	60,826
Noninterest income	10,167		9,677		8,248		28,092
Total external customer revenues	68,855		9,677		10,386		88,918
Inter-segment revenues:
Interest income	1,996		—		2,065		4,061
Noninterest income	2,164		191		36		2,391
Total inter-segment revenues	4,160		191		2,101		6,452
Total revenue	73,015		9,868		12,487		95,370
External customer expenses:
Interest expense	7,463		—		260		7,723
Noninterest expenses	38,960		6,135		6,411		51,506
Provision for loan losses	1,716		—		446		2,162
Total external customer expenses	48,139		6,135		7,117		61,391
Inter-segment expenses:
Interest expense	2,065		1,405		591		4,061
Noninterest expenses	227		715		1,449		2,391
Total inter-segment expenses	2,292		2,120		2,040		6,452
Total expenses	50,431		8,255		9,157		67,843
Income before taxes	$	22,584	$	1,613	$	3,330	$	27,527
Income tax provision							8,590
Consolidated net income							18,937
Capital expenditures	$	2,088	$	22	$	254	$	2,364

	March 31, 2017
(Dollars in thousands)	WSFS Bank		Cash Connect®		Wealth Management		Total
Statement of Financial Condition
Cash and cash equivalents	$	99,812	$	751,201	$	4,250	$	855,263
Goodwill	145,761		—		20,199		165,960
Other segment assets	5,608,912		4,097		218,667		5,831,676
Total segment assets	$	5,854,485	$	755,298	$	243,116	$	6,852,899

	Three months ended March 31, 2016
(Dollars in thousands)	WSFS Bank		Cash Connect®			Wealth Management			Total
Statement of Income
External customer revenues:
Interest income	$	48,038	$	—		$	2,008		$	50,046
Noninterest income	9,852		8,271		(r)	5,545			23,668
Total external customer revenues	57,890		8,271			7,553			73,714
Inter-segment revenues:
Interest income	1,061		—			1,895			2,956
Noninterest income	2,060		193			24			2,277
Total inter-segment revenues	3,121		193			1,919			5,233
Total revenue	61,011		8,464			9,472			78,947
External customer expenses:
Interest expense	4,497		—			193			4,690
Noninterest expenses	33,812		5,448		(r)	4,537			43,797
Provision for loan losses	815		—			(35		)	780
Total external customer expenses	39,124		5,448			4,695			49,267
Inter-segment expenses
Interest expense	1,895		555			506			2,956
Noninterest expenses	217		715			1,345			2,277
Total inter-segment expenses	2,112		1,270			1,851			5,233
Total expenses	41,236		6,718			6,546			54,500
Income before taxes	$	19,775	$	1,746		$	2,926		$	24,447
Income tax provision									8,677
Consolidated net income									15,770
Capital expenditures	$	1,211	$	20		$	2		$	1,233

	December 31, 2016
(Dollars in thousands)	WSFS Bank		Cash Connect®		Wealth Management		Total
Statement of Financial Condition
Cash and cash equivalents	$	100,893	$	717,643	$	3,387	$	821,923
Goodwill	147,396		—		20,143		167,539
Other segment assets	5,545,611		3,533		226,664		5,775,808
Total segment assets	$	5,793,900	$	721,176	$	250,194	$	6,765,270

^(r) Noninterest income and Noninterest expense for the period ended March 31, 2016 have been restated to correct an immaterial error related to revenue earned for cash servicing fees. See Note 1 - Basis of Presentation for further information.

XML

Change in Accumulated Other Comprehensive (Loss) Income (Tables)

3 Months Ended

Mar. 31, 2017

Equity [Abstract]

Components of Accumulated Other Comprehensive (Loss) Income

Changes to accumulated other comprehensive (loss) income by component are shown net of taxes in the following tables for the period indicated:

(Dollars in thousands)	Net change  in investment securities available for sale			Net change in securities held to maturity			Net change in defined benefit plan			Net change in fair value of derivative used for cash flow hedge			Total
Balance, December 31, 2016	$	(8,194	)	$	1,392		$	957		$	(1,772	)	$	(7,617	)
Other comprehensive income (loss) before reclassifications	1,272			—			—			(112		)	1,160
Less: Amounts reclassified from accumulated other comprehensive loss	(206		)	(101		)	(23		)	—			(330		)
Net current-period other comprehensive income (loss)	1,066			(101		)	(23		)	(112		)	830
Balance, March 31, 2017	$	(7,128	)	$	1,291		$	934		$	(1,884	)	$	(6,787	)
Balance, December 31, 2015	$	(1,887	)	$	1,795		$	788		$	—		$	696
Other comprehensive income before reclassifications	10,572			—			—			—			10,572
Less: Amounts reclassified from accumulated other comprehensive income	(189		)	(103		)	478			—			186
Net current-period other comprehensive income (loss)	10,383			(103		)	478			—			10,758
Balance, March 31, 2016	$	8,496		$	1,692		$	1,266		$	—		$	11,454

Components of Other Comprehensive Income (Loss)

The Consolidated Statements of Income were impacted by components of other comprehensive income (loss) as shown in the table below:

							Affected line item in
	Three Months Ended						Consolidated
(Dollars in thousands)	March 31,						Statements of Income
	2017			2016
Securities available for sale:
Realized gains on securities transactions	$	(320	)	$	(305	)	Security gains, net
Income taxes	114			116			Income tax provision
Net of tax	$	(206	)	$	(189	)
Net unrealized holding gains on securities transferred between available-for-sale and held-to-maturity:
Amortization of net unrealized gains to income during the period	$	(160	)	$	(168	)	Interest income on investment securities
Income taxes	59			65			Income tax provision
Net of tax	$	(101	)	$	(103	)
Amortization of Defined Benefit Pension items:
Prior service (credits) costs	$	(19	)	$	(7	)
Actuarial (gains) losses	(16		)	791
Total before tax	$	(35	)	$	784		Salaries, benefits and other compensation
Income taxes	12			(306		)	Income tax provision
Net of tax	(23		)	478
Total reclassifications	$	(330	)	$	186

XML

Basis of Presentation - Additional Information (Detail)	3 Months Ended
	Mar. 31, 2017 USD ($) Subsidiary Office	Dec. 31, 2016 USD ($)	Jun. 13, 2016 USD ($)	Dec. 31, 2012 USD ($)
Basis Of Presentation [Line Items]
Number of unconsolidated affiliate	1
Number of banking offices	77
Senior debt | $	$ 152,177,000	$ 152,050,000
Senior Unsecured Fixed - to - Floating Rate Notes
Basis Of Presentation [Line Items]
Senior unsecured fixed-to-floating rate notes, issued amount | $			$ 100,000,000
Interest rate on unsecured debt			4.50%
Senior unsecured notes, redemption price percentage of principal	100.00%
Senior Unsecured Fixed - to - Floating Rate Notes | London Interbank Offered Rate (LIBOR)
Basis Of Presentation [Line Items]
Senior unsecured notes, variable rate added to LIBOR	3.30%
Delaware
Basis Of Presentation [Line Items]
Number of banking offices	46
Pennsylvania
Basis Of Presentation [Line Items]
Number of banking offices	29
Virginia
Basis Of Presentation [Line Items]
Number of banking offices	1
Nevada
Basis Of Presentation [Line Items]
Number of banking offices	1
WSFS Financial Corporation
Basis Of Presentation [Line Items]
Number of wholly-owned subsidiaries | Subsidiary	3
Senior notes due 2019
Basis Of Presentation [Line Items]
Interest rate on unsecured debt				6.25%
Senior debt | $				$ 55,000,000.0

XML

Basis of Presentation - Correction of Prior Period Balances (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Noninterest income - Other revenue	$ 5,196	$ 4,570
Noninterest expense - Other operating expense	$ 9,119	7,659
Immaterial error, cash servicing fees
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Noninterest income - Other revenue		4,570
Noninterest expense - Other operating expense		7,659
Immaterial error, cash servicing fees | As originally reported
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Noninterest income - Other revenue		3,972
Noninterest expense - Other operating expense		7,061
Immaterial error, cash servicing fees | Adjustments
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Noninterest income - Other revenue		598
Noninterest expense - Other operating expense		$ 598

XML

Business Combinations - Summary of Consideration Paid and Fair Value of Identifiable Assets Acquired and Liabilities Assumed (Detail) - USD ($) $ in Thousands	Aug. 12, 2016	Mar. 31, 2017	Dec. 31, 2016
Liabilities assumed:
Goodwill resulting from acquisition of Penn Liberty		$ 165,960	$ 167,539
Penn Liberty Financial Corporation
Liabilities assumed:
Goodwill resulting from acquisition of Penn Liberty		$ 67,179	$ 68,814
Pennsylvania | Penn Liberty Financial Corporation
Consideration Transferred:
Common shares issued (1,806,748)	$ 68,352
Common shares issued (in shares)	1,806,748
Cash paid to Penn Liberty stock and option holders	$ 40,549
Value of consideration	108,901
Assets acquired:
Cash and due from banks	102,301
Investment securities	627
Loans	483,482
Premises and equipment	6,817
Deferred income taxes	6,542
Bank owned life insurance	8,666
Core deposit intangible	2,882
Other real estate owned	996
Other assets	12,092
Total assets	624,405
Liabilities assumed:
Deposits	568,706
Other borrowings	10,000
Other liabilities	3,977
Total liabilities	582,683
Net assets acquired:	41,722
Goodwill resulting from acquisition of Penn Liberty	$ 67,179

XML

Business Combinations - Summary of Changes to Goodwill (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2017 USD ($)
Goodwill [Roll Forward]
Goodwill resulting from the acquisition beginning balance	$ 167,539
Goodwill resulting from the acquisition ending balance	165,960
Penn Liberty Financial Corporation
Goodwill [Roll Forward]
Goodwill resulting from the acquisition beginning balance	68,814
Goodwill resulting from the acquisition ending balance	67,179
Deferred income taxes | Penn Liberty Financial Corporation
Goodwill [Roll Forward]
Effects of adjustments to	880
Other assets | Penn Liberty Financial Corporation
Goodwill [Roll Forward]
Effects of adjustments to	(1,447)
Other liabilities | Penn Liberty Financial Corporation
Goodwill [Roll Forward]
Effects of adjustments to	$ (1,068)

XML

Earnings Per Share - Computation of Basic and Diluted Earnings Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Numerator:
Net Income	$ 18,937	$ 15,770
Denominator:
Weighted average basic shares (in shares)	31,407	29,671
Dilutive potential common shares (in shares)	942	558
Weighted average fully diluted shares (in shares)	32,349	30,229
Earnings per share:
Basic (in dollars per share)	$ 0.60	$ 0.53
Diluted (in dollars per share)	$ 0.59	$ 0.52
Outstanding common stock equivalents having no dilutive effect (in shares)	22	42

XML

Investment Securities - Additional Information (Detail)	3 Months Ended		12 Months Ended
	Mar. 31, 2017 USD ($) secuirty	Mar. 31, 2016 USD ($)	Dec. 31, 2016 USD ($)
Schedule of Available-for-sale Securities [Line Items]
Trading securities	$ 0
Available-for-sale securities, amortized cost basis	800,612,000		$ 807,761,000
Securities pledged as collateral	615,800,000		562,500,000
Proceeds from sale of investment securities	263,000,000	$ 38,900,000
Gains from sale of Available-for-sale securities	$ 300,000	300,000
Security sold | secuirty	1
Losses from sale of Available-for-sale securities	$ 0	$ 0
Unamortized premiums	16,300,000		18,000,000
Unaccreted discounts	600,000		400,000
Owned investment securities	612,300,000
Total unrealized losses on securities	$ 14,700,000
Number of securities, below investment grade | secuirty	1
Available-for-sale securities, below investment grade, fair value	$ 1,000,000
Weighted average duration of MBS portfolio	5 years 4 months 2 days
Mortgage-Backed Securities (MBS)
Schedule of Available-for-sale Securities [Line Items]
OTTI on evaluation of securities	$ 0		0
Mutual Fund
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, amortized cost basis	600,000		600,000
State and political subdivisions
Schedule of Available-for-sale Securities [Line Items]
Securities transferred from available-for-sale to held-to-maturity, net unrealized gain	$ 2,100,000		$ 2,200,000

XML

Investment Securities - Schedule of Amortized Cost and Estimated Fair Value of Available-for-Sale and Held-to-Maturity Investment Securities (Detail) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	$ 800,612	$ 807,761
Gross Unrealized Gain	2,164	1,963
Gross Unrealized Loss	13,651	15,181
Investment securities available for sale	789,125	794,543
Held-to-Maturity Securities, Amortized Cost	163,611	164,346
Held-to-Maturity Securities, Fair Value	163,241	163,232
CMO
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	280,576	264,607
Gross Unrealized Gain	699	566
Gross Unrealized Loss	3,564	3,957
Investment securities available for sale	277,711	261,216
FNMA MBS
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	393,356	414,218
Gross Unrealized Gain	984	950
Gross Unrealized Loss	8,289	9,404
Investment securities available for sale	386,051	405,764
FHLMC MBS
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	65,228	64,709
Gross Unrealized Gain	204	135
Gross Unrealized Loss	1,261	1,330
Investment securities available for sale	64,171	63,514
GNMA MBS
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	27,767	28,540
Gross Unrealized Gain	275	303
Gross Unrealized Loss	445	427
Investment securities available for sale	27,597	28,416
Other investments
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	634	626
Gross Unrealized Gain	0	0
Gross Unrealized Loss	20	3
Investment securities available for sale	614	623
GSE
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	33,051	35,061
Gross Unrealized Gain	2	9
Gross Unrealized Loss	72	60
Investment securities available for sale	32,981	35,010
State and political subdivisions
Schedule of Available-for-sale Securities [Line Items]
Held-to-Maturity Securities, Amortized Cost	163,611	164,346
Held-to-Maturity Securities, Gross Unrealized Gain	646	271
Held-to-Maturity Securities, Gross Unrealized Loss	1,016	1,385
Held-to-Maturity Securities, Fair Value	$ 163,241	$ 163,232

XML

Investment Securities - Schedule of Maturities of Investment Securities Available-for-Sale and Held-to-Maturity (Detail) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Investments, Debt and Equity Securities [Abstract]
Available-for-sale securities, amortized cost within one year	$ 20,012	$ 16,009
Available-for-sale securities, amortized cost after one year but within five years	18,059	19,052
Available-for-sale securities, amortized cost after five years but within ten years	210,595	276,635
Available-for-sale securities, amortized cost after ten years	551,312	495,439
Available-for-sale securities, amortized cost total	799,978	807,135
Available-for-sale securities, fair value within one year	19,997	16,017
Available-for-sale securities, fair value after one year but within five years	17,981	18,992
Available-for-sale securities, fair value after five years but within ten years	205,242	270,300
Available-for-sale securities, fair value after ten years	545,291	488,611
Available-for-sale securities, fair value total	788,511	793,920
Held-to-maturity securities, amortized cost within one year	0	0
Held-to-maturity securities, amortized cost after one year but within five years	5,940	6,168
Held-to-maturity securities, amortized cost after five years but within ten years	10,482	8,882
Held-to-maturity securities, amortized cost after ten years	147,189	149,296
Held-to-Maturity Securities, Amortized Cost	163,611	164,346
Held-to-maturity securities, fair value within one year	0	0
Held-to-maturity securities, fair value after one year but within five years	5,975	6,162
Held-to-maturity securities, after five years but within ten years	10,511	8,870
Held-to-maturity securities, after ten years	146,755	148,200
Held-to-maturity securities, fair value total	$ 163,241	$ 163,232

XML

Investment Securities - Schedule of Investment Securities' Gross Unrealized Losses and Fair Value by Investment Category (Detail) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, Less than 12 months, Fair Value	$ 522,016	$ 550,952
Available-for-sale securities, Less than 12 months, Unrealized Loss	13,556	15,091
Available-for-sale securities, 12 months or longer, Fair Value	4,239	4,654
Available-for-sale securities, 12 months or longer, Unrealized Loss	95	90
Available-for-sale securities, Total, Fair Value	526,255	555,606
Available-for-sale securities, Total, Unrealized Loss	13,651	15,181
Held-to-maturity, Less than 12 months, Fair Value	84,121	112,642
Held-to-maturity, Less than 12 months, Unrealized Loss	969	1,374
Held-to-maturity, 12 months or longer, Fair Value	1,960	695
Held-to-maturity, 12 months or longer, Unrealized Loss	47	11
Held-to-maturity, Total, Fair Value	86,081	113,337
Held-to-maturity, Total, Unrealized Loss	1,016	1,385
CMO
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, Less than 12 months, Fair Value	161,225	160,572
Available-for-sale securities, Less than 12 months, Unrealized Loss	3,469	3,867
Available-for-sale securities, 12 months or longer, Fair Value	4,239	4,654
Available-for-sale securities, 12 months or longer, Unrealized Loss	95	90
Available-for-sale securities, Total, Fair Value	165,464	165,226
Available-for-sale securities, Total, Unrealized Loss	3,564	3,957
FNMA MBS
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, Less than 12 months, Fair Value	276,175	50,878
Available-for-sale securities, Less than 12 months, Unrealized Loss	8,289	1,330
Available-for-sale securities, 12 months or longer, Fair Value	0	0
Available-for-sale securities, 12 months or longer, Unrealized Loss	0	0
Available-for-sale securities, Total, Fair Value	276,175	50,878
Available-for-sale securities, Total, Unrealized Loss	8,289	1,330
FHLMC MBS
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, Less than 12 months, Fair Value	41,765	300,403
Available-for-sale securities, Less than 12 months, Unrealized Loss	1,261	9,404
Available-for-sale securities, 12 months or longer, Fair Value	0	0
Available-for-sale securities, 12 months or longer, Unrealized Loss	0	0
Available-for-sale securities, Total, Fair Value	41,765	300,403
Available-for-sale securities, Total, Unrealized Loss	1,261	9,404
GNMA MBS
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, Less than 12 months, Fair Value	16,236	16,480
Available-for-sale securities, Less than 12 months, Unrealized Loss	445	427
Available-for-sale securities, 12 months or longer, Fair Value	0	0
Available-for-sale securities, 12 months or longer, Unrealized Loss	0	0
Available-for-sale securities, Total, Fair Value	16,236	16,480
Available-for-sale securities, Total, Unrealized Loss	445	427
Other investments
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, Less than 12 months, Fair Value	634	623
Available-for-sale securities, Less than 12 months, Unrealized Loss	20	3
Available-for-sale securities, 12 months or longer, Fair Value	0	0
Available-for-sale securities, 12 months or longer, Unrealized Loss	0	0
Available-for-sale securities, Total, Fair Value	634	623
Available-for-sale securities, Total, Unrealized Loss	20	3
GSE
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, Less than 12 months, Fair Value	25,981	21,996
Available-for-sale securities, Less than 12 months, Unrealized Loss	72	60
Available-for-sale securities, 12 months or longer, Fair Value	0	0
Available-for-sale securities, 12 months or longer, Unrealized Loss	0	0
Available-for-sale securities, Total, Fair Value	25,981	21,996
Available-for-sale securities, Total, Unrealized Loss	72	60
State and political subdivisions
Schedule of Available-for-sale Securities [Line Items]
Held-to-maturity, Less than 12 months, Fair Value	84,121	112,642
Held-to-maturity, Less than 12 months, Unrealized Loss	969	1,374
Held-to-maturity, 12 months or longer, Fair Value	1,960	695
Held-to-maturity, 12 months or longer, Unrealized Loss	47	11
Held-to-maturity, Total, Fair Value	86,081	113,337
Held-to-maturity, Total, Unrealized Loss	$ 1,016	$ 1,385

XML

Loans - Summary of Loan Portfolio by Category (Detail) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016	Mar. 31, 2016	Dec. 31, 2015
Accounts, Notes, Loans and Financing Receivable [Line Items]
Gross loans	$ 4,577,628	$ 4,469,216	$ 3,803,713
Deferred fees, net	8,156	7,673
Allowance for loan losses	39,826	39,751	37,556	$ 37,089
Net loans	4,552,151	4,444,375
Reverse mortgage, fair value	22,500	22,600	24,700
Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Gross loans	464,898	450,029	359,656
Allowance for loan losses	6,241	6,012	5,954	5,964
Commercial and industrial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Gross loans	1,339,867	1,287,731
Owner-occupied commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Gross loans	1,092,292	1,078,162	895,457
Allowance for loan losses	6,030	6,588	6,702	6,670
Commercial mortgages
Accounts, Notes, Loans and Financing Receivable [Line Items]
Gross loans	1,165,556	1,163,554	987,066
Allowance for loan losses	8,335	8,915	6,516	6,487
Construction
Accounts, Notes, Loans and Financing Receivable [Line Items]
Gross loans	255,760	222,712	227,348
Allowance for loan losses	2,961	2,838	$ 3,609	$ 3,521
Residential
Accounts, Notes, Loans and Financing Receivable [Line Items]
Gross loans	281,760	289,611
Financing Receivable Portfolio Segment, Including Reverse Mortgages
Accounts, Notes, Loans and Financing Receivable [Line Items]
Gross loans	$ 4,600,133	$ 4,491,799

XML

Loans - Schedule of Outstanding Principal Balance and Carrying Amounts for Acquired Credit-Impaired Loans (Detail) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Receivables [Abstract]
Outstanding principal balance	$ 38,418	$ 41,574
Carrying amount	30,783	33,104
Allowance for loan losses	$ 464	$ 510

XML

Loans - Summary of Changes in Accretable Yield on Acquired Credit Impaired Loans (Detail) $ in Thousands	3 Months Ended
	Mar. 31, 2017 USD ($)
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward]
Balance at beginning of period	$ 5,150
Accretion	(792)
Reclassification from nonaccretable difference	(144)
Additions/adjustments	(112)
Disposals	0
Balance at the end of the period	$ 4,102

XML

Allowance for Loan Losses and Credit Quality Information - Additional Information (Detail)	3 Months Ended						12 Months Ended
	Mar. 31, 2017 USD ($)	Mar. 31, 2017 USD ($)	Mar. 31, 2017 USD ($)	Mar. 31, 2017 USD ($) SecurityLoan	Mar. 31, 2017 USD ($) loan	Mar. 31, 2016 USD ($)	Dec. 31, 2016 USD ($) SecurityLoan
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net charge-offs			$ 2,100,000			$ 300,000
Percentage of average loans annualized, charged-offs		0.19%				0.03%
Reverse mortgage, fair value	$ 22,500,000	$ 22,500,000	22,500,000	$ 22,500,000	$ 22,500,000	$ 24,700,000	$ 22,600,000
Performing TDRs			17,260,000			13,900,000	14,336,000
Acquired nonimpaired loans	675,607,000	675,607,000	675,607,000	675,607,000	675,607,000	354,694,000	724,100,000
Acquired impaired loans	10,700,000	10,700,000	10,700,000	10,700,000	10,700,000		12,800,000
Contractual principal balance	11,800,000	11,800,000	11,800,000	11,800,000	11,800,000		15,000,000
Interest income on impaired loans			300,000			200,000
Accrued troubled debt restructured loans	13,700,000	13,700,000	13,700,000	13,700,000	13,700,000		12,400,000
Total TDRs	28,038,000	28,038,000	28,038,000	28,038,000	28,038,000		22,787,000
Nonperforming TDRs			10,778,000				8,451,000
Troubled debt restructuring related reserves	$ 1,900,000	1,900,000	1,900,000	$ 1,900,000	$ 1,900,000		$ 1,300,000
Number of term loans modified in troubled debt restructurings | SecurityLoan				12
Maturity Date Extension | SecurityLoan				4
Usual sustained repayment performance period	6 months
TRD defaulted				7	3
Subsequent default, loan amount			700,000
Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Acquired nonimpaired loans	$ 141,933,000	141,933,000	141,933,000	$ 141,933,000	$ 141,933,000	107,380,000
Number of commercial loans | SecurityLoan				7			7
Total loans outstanding,commercial loans	2,200,000	2,200,000	2,200,000	$ 2,200,000	2,200,000		$ 3,600,000
Number of term loans modified in troubled debt restructurings | SecurityLoan				1
Maturity Date Extension | SecurityLoan				1
TRD defaulted | SecurityLoan				0
Residential
Accounts, Notes, Loans and Financing Receivable [Line Items]
Acquired nonimpaired loans	85,679,000	85,679,000	85,679,000	$ 85,679,000	85,679,000	73,240,000
Number of residential loans in the process of foreclosure | SecurityLoan				39			29
Total loans outstanding, residential loans			4,900,000				$ 3,700,000
Number of term loans modified in troubled debt restructurings | SecurityLoan				1
Maturity Date Extension | SecurityLoan				0
TRD defaulted | SecurityLoan				1
Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Acquired nonimpaired loans	$ 50,321,000	50,321,000	50,321,000	$ 50,321,000	50,321,000	15,803,000
Number of term loans modified in troubled debt restructurings | SecurityLoan				7
Maturity Date Extension | SecurityLoan				0
TRD defaulted | SecurityLoan				6
Minimum
Accounts, Notes, Loans and Financing Receivable [Line Items]
Period for impairment loans	90 days
Maximum
Accounts, Notes, Loans and Financing Receivable [Line Items]
Increase in allowance for loan losses (less than)			300,000			0
Troubled debt restructurings charged off (less than)			0			$ 100,000
Total Residential and Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Acquired nonimpaired loans	$ 136,000,000	136,000,000	136,000,000	$ 136,000,000	136,000,000		150,500,000
Impairment loans, charge off period	90 days
Total Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Acquired nonimpaired loans	$ 539,600,000	$ 539,600,000	$ 539,600,000	$ 539,600,000	$ 539,600,000		$ 573,500,000

XML

Allowance for Loan Losses and Credit Quality Information - Schedule of Allowance for Loan Losses and Loan Balances (Detail) - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016
Allowance for loan losses
Beginning balance	$ 39,751	$ 37,089	$ 37,089
Charge-offs	(2,719)	(867)
Recoveries	632	554
Provision (credit)	2,114	907
Provision for acquired loans	48	(127)
Ending balance	39,826	37,556	39,751
Loans individually evaluated for impairment	4,836	2,803
Loans collectively evaluated for impairment	34,526	34,634
Acquired loans evaluated for impairment	464	119
Ending balance	39,826	37,556
Loans individually evaluated for impairment	56,997	33,700
Loans collectively evaluated for impairment	3,813,777	3,383,035
Acquired nonimpaired loans	675,607	354,694	724,100
Acquired impaired loans	31,247	32,284	33,614
Ending balance	4,577,628	3,803,713	4,469,216
Owner-occupied commercial
Allowance for loan losses
Beginning balance	6,588	6,670	6,670
Charge-offs	(192)	0
Recoveries	75	38
Provision (credit)	(441)	(6)
Provision for acquired loans	0	0
Ending balance	6,030	6,702	6,588
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	6,015	6,680
Acquired loans evaluated for impairment	15	22
Ending balance	6,030	6,702
Loans individually evaluated for impairment	4,020	1,270
Loans collectively evaluated for impairment	919,508	839,819
Acquired nonimpaired loans	156,724	49,765
Acquired impaired loans	12,040	4,603	12,122
Ending balance	1,092,292	895,457	1,078,162
Commercial mortgages
Allowance for loan losses
Beginning balance	8,915	6,487	6,487
Charge-offs	(104)	(17)
Recoveries	46	79
Provision (credit)	(518)	(37)
Provision for acquired loans	(4)	4
Ending balance	8,335	6,516	8,915
Loans individually evaluated for impairment	1,395	0
Loans collectively evaluated for impairment	6,763	6,427
Acquired loans evaluated for impairment	177	89
Ending balance	8,335	6,516
Loans individually evaluated for impairment	9,771	2,678
Loans collectively evaluated for impairment	928,925	893,036
Acquired nonimpaired loans	216,410	80,795
Acquired impaired loans	10,450	10,557	10,386
Ending balance	1,165,556	987,066	1,163,554
Construction
Allowance for loan losses
Beginning balance	2,838	3,521	3,521
Charge-offs	(14)	(26)
Recoveries	2	46
Provision (credit)	158	72
Provision for acquired loans	(23)	(4)
Ending balance	2,961	3,609	2,838
Loans individually evaluated for impairment	500	211
Loans collectively evaluated for impairment	2,397	3,398
Acquired loans evaluated for impairment	64	0
Ending balance	2,961	3,609
Loans individually evaluated for impairment	3,130	1,419
Loans collectively evaluated for impairment	225,718	194,654
Acquired nonimpaired loans	24,540	27,711
Acquired impaired loans	2,372	3,564	3,694
Ending balance	255,760	227,348	222,712
Complexity Risk
Allowance for loan losses
Beginning balance		1,010	1,010
Charge-offs		0
Recoveries		0
Provision (credit)		14
Provision for acquired loans		0
Ending balance		1,024
Loans individually evaluated for impairment		0
Loans collectively evaluated for impairment		1,024
Acquired loans evaluated for impairment		0
Ending balance		1,024
Loans individually evaluated for impairment		0
Loans collectively evaluated for impairment		0
Acquired nonimpaired loans		0
Acquired impaired loans		0
Ending balance		0
Commercial
Allowance for loan losses
Beginning balance	13,339	11,156	11,156
Charge-offs	(1,255)	(179)
Recoveries	84	110
Provision (credit)	1,949	484
Provision for acquired loans	88	(89)
Ending balance	14,205	11,482	13,339
Loans individually evaluated for impairment	1,860	1,473
Loans collectively evaluated for impairment	12,165	10,005
Acquired loans evaluated for impairment	180	4
Ending balance	14,205	11,482
Loans individually evaluated for impairment	16,767	5,278
Loans collectively evaluated for impairment	1,175,911	957,863
Acquired nonimpaired loans	141,933	107,380
Acquired impaired loans	5,256	12,600	6,183
Ending balance	1,339,867	1,083,121	1,287,731
Residential
Allowance for loan losses
Beginning balance	2,059	2,281	2,281
Charge-offs	(11)	(14)
Recoveries	120	22
Provision (credit)	(114)	(20)
Provision for acquired loans	0	0
Ending balance	2,054	2,269	2,059
Loans individually evaluated for impairment	887	911
Loans collectively evaluated for impairment	1,144	1,354
Acquired loans evaluated for impairment	23	4
Ending balance	2,054	2,269
Loans individually evaluated for impairment	14,280	15,260
Loans collectively evaluated for impairment	158,430	161,610
Acquired nonimpaired loans	85,679	73,240
Acquired impaired loans	866	955	860
Ending balance	259,255	251,065	267,028
Consumer
Allowance for loan losses
Beginning balance	6,012	5,964	5,964
Charge-offs	(1,143)	(631)
Recoveries	305	259
Provision (credit)	1,080	400
Provision for acquired loans	(13)	(38)
Ending balance	6,241	5,954	6,012
Loans individually evaluated for impairment	194	208
Loans collectively evaluated for impairment	6,042	5,746
Acquired loans evaluated for impairment	5	0
Ending balance	6,241	5,954
Loans individually evaluated for impairment	9,029	7,795
Loans collectively evaluated for impairment	405,285	336,053
Acquired nonimpaired loans	50,321	15,803
Acquired impaired loans	263	5	369
Ending balance	$ 464,898	$ 359,656	$ 450,029

XML

Allowance for Loan Losses and Credit Quality Information - Summary of Nonaccrual and Past Due Loans (Detail) - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	$ 7,469		$ 7,730
Accruing Current Balances	4,499,234		4,404,996
Acquired Impaired Loans	31,247	$ 32,284	33,614
Nonaccrual Loans	39,678		22,876
Total Loans	$ 4,577,628	3,803,713	$ 4,469,216
30-59 Days Past Due and Still Accruing, % of Total Loans	0.08%		0.12%
60-89 Days Past Due and Still Accruing, % of Total Loans	0.04%		0.04%
Greater Than 90 Days Past Due and Still Accruing, % of Total Loans	0.04%		0.01%
Total Past Due And Still Accruing, % of Total Loans	0.16%		0.17%
Accruing Current Balances, % of Total Loans	98.29%		98.56%
Acquired Impaired Loans, % of Total Loans	0.68%		0.75%
Nonaccrual Loans, % of Total Loans	0.87%		0.51%
% of Total Loans	100.00%		100.00%
Commercial
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	$ 1,250		$ 1,785
Accruing Current Balances	1,316,841		1,277,748
Acquired Impaired Loans	5,256	12,600	6,183
Nonaccrual Loans	16,520		2,015
Total Loans	1,339,867	1,083,121	1,287,731
Residential
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	2,989		3,967
Accruing Current Balances	250,443		257,234
Acquired Impaired Loans	866	955	860
Nonaccrual Loans	4,957		4,967
Total Loans	259,255	251,065	267,028
Consumer
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	1,092		1,023
Accruing Current Balances	459,057		444,642
Acquired Impaired Loans	263	5	369
Nonaccrual Loans	4,486		3,995
Total Loans	464,898	359,656	450,029
30–59 Days Past Due and Still Accruing
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	4,006		5,490
30–59 Days Past Due and Still Accruing | Commercial
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	783		1,507
30–59 Days Past Due and Still Accruing | Residential
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	2,020		3,176
30–59 Days Past Due and Still Accruing | Consumer
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	374		392
60–89 Days Past Due and Still Accruing
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	1,698		1,802
60–89 Days Past Due and Still Accruing | Commercial
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	467		278
60–89 Days Past Due and Still Accruing | Residential
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	119		638
60–89 Days Past Due and Still Accruing | Consumer
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	612		346
Greater Than 90 Days Past Due and Still Accruing
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	1,765		438
Greater Than 90 Days Past Due and Still Accruing | Commercial
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	0		0
Greater Than 90 Days Past Due and Still Accruing | Residential
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	850		153
Greater Than 90 Days Past Due and Still Accruing | Consumer
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	106		285
Owner-occupied commercial
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	841		656
Accruing Current Balances	1,075,391		1,063,306
Acquired Impaired Loans	12,040	4,603	12,122
Nonaccrual Loans	4,020		2,078
Total Loans	1,092,292	895,457	1,078,162
Owner-occupied commercial | 30–59 Days Past Due and Still Accruing
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	341		116
Owner-occupied commercial | 60–89 Days Past Due and Still Accruing
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	500		540
Owner-occupied commercial | Greater Than 90 Days Past Due and Still Accruing
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	0		0
Commercial mortgages
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	794		167
Accruing Current Balances	1,144,617		1,143,180
Acquired Impaired Loans	10,450	10,557	10,386
Nonaccrual Loans	9,695		9,821
Total Loans	1,165,556	987,066	1,163,554
Commercial mortgages | 30–59 Days Past Due and Still Accruing
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	451		167
Commercial mortgages | 60–89 Days Past Due and Still Accruing
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	0		0
Commercial mortgages | Greater Than 90 Days Past Due and Still Accruing
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	343		0
Construction
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	503		132
Accruing Current Balances	252,885		218,886
Acquired Impaired Loans	2,372	3,564	3,694
Nonaccrual Loans	0		0
Total Loans	255,760	$ 227,348	222,712
Construction | 30–59 Days Past Due and Still Accruing
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	37		132
Construction | 60–89 Days Past Due and Still Accruing
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	0		0
Construction | Greater Than 90 Days Past Due and Still Accruing
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Past Due And Still Accruing	$ 466		$ 0

XML

Allowance for Loan Losses and Credit Quality Information - Analysis of Impaired Loans (Detail) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2017	Dec. 31, 2016
Accounts, Notes, Loans and Financing Receivable [Line Items]
Ending Loan Balances	$ 67,743	$ 51,600
Loans with No Related Reserve	27,537	21,504
Loans with Related Reserve	40,206	28,400
Related Reserve	5,300	3,405
Contractual Principal Balances	80,503	64,665
Average Loan Balances	47,089	41,084
Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Ending Loan Balances	18,550	4,250
Loans with No Related Reserve	2,598	1,395
Loans with Related Reserve	15,952	2,855
Related Reserve	2,040	505
Contractual Principal Balances	20,197	5,572
Average Loan Balances	7,535	5,053
Residential
Accounts, Notes, Loans and Financing Receivable [Line Items]
Ending Loan Balances	15,000	14,256
Loans with No Related Reserve	8,056	7,122
Loans with Related Reserve	6,944	7,134
Related Reserve	910	934
Contractual Principal Balances	17,904	17,298
Average Loan Balances	14,941	15,083
Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Ending Loan Balances	9,070	8,021
Loans with No Related Reserve	7,526	6,561
Loans with Related Reserve	1,544	1,460
Related Reserve	199	215
Contractual Principal Balances	11,578	11,978
Average Loan Balances	8,191	7,910
Owner-occupied commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Ending Loan Balances	6,210	4,650
Loans with No Related Reserve	4,020	2,078
Loans with Related Reserve	2,190	2,572
Related Reserve	15	15
Contractual Principal Balances	6,372	5,129
Average Loan Balances	4,155	3,339
Commercial mortgages
Accounts, Notes, Loans and Financing Receivable [Line Items]
Ending Loan Balances	14,478	15,065
Loans with No Related Reserve	4,220	4,348
Loans with Related Reserve	10,258	10,717
Related Reserve	1,572	1,433
Contractual Principal Balances	19,906	20,716
Average Loan Balances	9,288	7,323
Construction
Accounts, Notes, Loans and Financing Receivable [Line Items]
Ending Loan Balances	4,435	3,662
Loans with No Related Reserve	1,117	0
Loans with Related Reserve	3,318	3,662
Related Reserve	564	303
Contractual Principal Balances	4,546	3,972
Average Loan Balances	$ 2,979	2,376
Collateral Dependent Impaired Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Ending Loan Balances		$ 49,904

XML

Allowance for Loan Losses and Credit Quality Information - Schedule of Commercial Credit Exposure (Detail) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Accounts, Notes, Loans and Financing Receivable [Line Items]
Commercial Loans	100.00%	100.00%
Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	$ 1,339,867	$ 1,287,731
Special mention | Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	17,590	17,630
Accrual | Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	41,136	45,067
Nonaccrual | Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	14,660	1,693
Doubtful | Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	$ 1,860	$ 322
Total Special Mention and Substandard
Accounts, Notes, Loans and Financing Receivable [Line Items]
Commercial Loans	4.00%	4.00%
Total Special Mention and Substandard | Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	$ 75,246	$ 64,712
Acquired impaired
Accounts, Notes, Loans and Financing Receivable [Line Items]
Commercial Loans	1.00%	1.00%
Acquired impaired | Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	$ 5,256	$ 6,183
Pass
Accounts, Notes, Loans and Financing Receivable [Line Items]
Commercial Loans	95.00%	95.00%
Pass | Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	$ 1,259,365	$ 1,216,836
Owner-occupied commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	1,092,292	1,078,162
Owner-occupied commercial | Special mention
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	6,849	11,419
Owner-occupied commercial | Accrual
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	20,162	19,871
Owner-occupied commercial | Nonaccrual
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	4,020	2,078
Owner-occupied commercial | Doubtful
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	0	0
Owner-occupied commercial | Total Special Mention and Substandard
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	31,031	33,368
Owner-occupied commercial | Acquired impaired
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	12,040	12,122
Owner-occupied commercial | Pass
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	1,049,221	1,032,672
Commercial mortgages
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	1,165,556	1,163,554
Commercial mortgages | Special mention
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	21,931	34,198
Commercial mortgages | Accrual
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	3,216	239
Commercial mortgages | Nonaccrual
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	8,300	8,574
Commercial mortgages | Doubtful
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	1,395	1,247
Commercial mortgages | Total Special Mention and Substandard
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	34,842	44,258
Commercial mortgages | Acquired impaired
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	10,450	10,386
Commercial mortgages | Pass
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	1,120,264	1,108,910
Construction
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	255,760	222,712
Construction | Special mention
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	1,008	0
Construction | Accrual
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	4,489	2,193
Construction | Nonaccrual
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	0	0
Construction | Doubtful
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	0	0
Construction | Total Special Mention and Substandard
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	5,497	2,193
Construction | Acquired impaired
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	2,372	3,694
Construction | Pass
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	247,891	216,825
Total Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	3,853,475	3,752,159
Total Commercial | Special mention
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	47,378	63,247
Total Commercial | Accrual
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	69,003	67,370
Total Commercial | Nonaccrual
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	26,980	12,345
Total Commercial | Doubtful
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	3,255	1,569
Total Commercial | Total Special Mention and Substandard
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	146,616	144,531
Total Commercial | Acquired impaired
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	30,118	32,385
Total Commercial | Pass
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Commercial Loans	$ 3,676,741	$ 3,575,243

XML

Allowance for Loan Losses and Credit Quality Information - Schedule of Residential and Consumer Credit Exposure (Detail) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016	Mar. 31, 2016
Accounts, Notes, Loans and Financing Receivable [Line Items]
Gross loans	$ 4,577,628	$ 4,469,216	$ 3,803,713
Total	100.00%	100.00%
Residential
Accounts, Notes, Loans and Financing Receivable [Line Items]
Gross loans	$ 259,255	$ 267,028	251,065
Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Gross loans	464,898	450,029	$ 359,656
Nonperforming | Residential
Accounts, Notes, Loans and Financing Receivable [Line Items]
Gross loans	14,280	13,547
Nonperforming | Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Gross loans	9,030	7,863
Performing | Residential
Accounts, Notes, Loans and Financing Receivable [Line Items]
Gross loans	244,109	252,621
Performing | Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Gross loans	$ 455,605	$ 441,797
Acquired impaired
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	1.00%	1.00%
Acquired impaired | Residential
Accounts, Notes, Loans and Financing Receivable [Line Items]
Gross loans	$ 866	$ 860
Acquired impaired | Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Gross loans	263	369
Total Residential and Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Gross loans	$ 724,153	$ 717,057
Total	100.00%	100.00%
Total Residential and Consumer | Nonperforming
Accounts, Notes, Loans and Financing Receivable [Line Items]
Gross loans	$ 23,310	$ 21,410
Total	3.00%	3.00%
Total Residential and Consumer | Performing
Accounts, Notes, Loans and Financing Receivable [Line Items]
Gross loans	$ 699,714	$ 694,418
Total	97.00%	97.00%
Total Residential and Consumer | Acquired impaired
Accounts, Notes, Loans and Financing Receivable [Line Items]
Gross loans	$ 1,129	$ 1,229
Total	0.00%	0.00%

XML

Allowance for Loan Losses and Credit Quality Information - Schedule of Troubled Debt Restructurings (Detail) - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016
Receivables [Abstract]
Performing TDRs	$ 17,260	$ 13,900	$ 14,336
Nonperforming TDRs	10,778		8,451
Total TDRs	$ 28,038		$ 22,787

XML

Allowance for Loan Losses and Credit Quality Information - Schedule of Types of TDR (Detail) - 3 months ended Mar. 31, 2017	SecurityLoan	loan
Accounts, Notes, Loans and Financing Receivable [Line Items]
Maturity Date Extension	4
Discharged in bankruptcy	7	3
Other	1
Total	12
Owner-occupied commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Maturity Date Extension	1
Discharged in bankruptcy	0
Other	0
Total	1
Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Maturity Date Extension	1
Discharged in bankruptcy	0
Other	0
Total	1
Construction
Accounts, Notes, Loans and Financing Receivable [Line Items]
Maturity Date Extension	2
Discharged in bankruptcy	0
Other	0
Total	2
Residential
Accounts, Notes, Loans and Financing Receivable [Line Items]
Maturity Date Extension	0
Discharged in bankruptcy	1
Other	0
Total	1
Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Maturity Date Extension	0
Discharged in bankruptcy	6
Other	1
Total	7

XML

Allowance for Loan Losses and Credit Quality Information - Schedule of Loans Identified as Troubled Debt Restructurings During Periods Indicated (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Financing Receivable, Modifications [Line Items]
Total loans identified during the period	$ 6,052	$ 1,813
Commercial
Financing Receivable, Modifications [Line Items]
Total loans identified during the period	443	984
Commercial mortgages
Financing Receivable, Modifications [Line Items]
Total loans identified during the period	0	0
Construction
Financing Receivable, Modifications [Line Items]
Total loans identified during the period	1,712	0
Residential
Financing Receivable, Modifications [Line Items]
Total loans identified during the period	242	614
Consumer
Financing Receivable, Modifications [Line Items]
Total loans identified during the period	584	215
Owner-occupied commercial
Financing Receivable, Modifications [Line Items]
Total loans identified during the period	$ 3,071	$ 0

XML

Goodwill and Intangibles - Schedule of Allocation of Goodwill to Our Reportable Operating Segments for Purposes of Goodwill Impairment Testing (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Goodwill [Roll Forward]
Goodwill resulting from the acquisition beginning balance	$ 167,539
Remeasurement adjustments	(1,579)	$ (358)
Goodwill from business combinations	0
Goodwill resulting from the acquisition ending balance	165,960
WSFS Bank
Goodwill [Roll Forward]
Goodwill resulting from the acquisition beginning balance	147,396
Remeasurement adjustments	(1,635)
Goodwill from business combinations	0
Goodwill resulting from the acquisition ending balance	145,761
Cash Connect
Goodwill [Roll Forward]
Goodwill resulting from the acquisition beginning balance	0
Remeasurement adjustments	0
Goodwill from business combinations	0
Goodwill resulting from the acquisition ending balance	0
Wealth Management
Goodwill [Roll Forward]
Goodwill resulting from the acquisition beginning balance	20,143
Remeasurement adjustments	56
Goodwill from business combinations	0
Goodwill resulting from the acquisition ending balance	$ 20,199

XML

Goodwill and Intangibles - Summary of Other Intangible Assets (Detail) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Finite-Lived Intangible Assets [Line Items]
Gross Intangible Assets	$ 32,193	$ 33,861
Accumulated Amortization	(7,781)	(10,153)
Total	24,412	23,708
Core deposits
Finite-Lived Intangible Assets [Line Items]
Gross Intangible Assets	10,658	13,128
Accumulated Amortization	(3,440)	(5,630)
Total	$ 7,218	$ 7,498
Finite-Lived Intangible Asset, Useful Life	10 years	10 years
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Gross Intangible Assets	$ 17,561	$ 17,561
Accumulated Amortization	(3,013)	(2,612)
Total	14,548	14,949
Non-compete agreements
Finite-Lived Intangible Assets [Line Items]
Gross Intangible Assets	221	1,006
Accumulated Amortization	(24)	(728)
Total	$ 197	278
Finite-Lived Intangible Asset, Useful Life	5 years
Loan servicing rights
Finite-Lived Intangible Assets [Line Items]
Gross Intangible Assets	$ 1,821	1,708
Accumulated Amortization	(1,092)	(1,067)
Total	729	641
Favorable lease asset
Finite-Lived Intangible Assets [Line Items]
Gross Intangible Assets	1,932	458
Accumulated Amortization	(212)	(116)
Total	$ 1,720	$ 342
Minimum | Customer relationships
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Asset, Useful Life	7 years	7 years
Minimum | Non-compete agreements
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Asset, Useful Life		6 months
Minimum | Loan servicing rights
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Asset, Useful Life	10 years	10 years
Minimum | Favorable lease asset
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Asset, Useful Life	10 months	10 months
Maximum | Customer relationships
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Asset, Useful Life	15 years	15 years
Maximum | Non-compete agreements
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Asset, Useful Life		5 years
Maximum | Loan servicing rights
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Asset, Useful Life	30 years	30 years
Maximum | Favorable lease asset
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Asset, Useful Life	18 years	15 years

XML

Goodwill and Intangibles - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Finite-Lived Intangible Assets [Line Items]
Amortization expense on other intangible assets	$ 857	$ 549
Other Intangible Assets
Finite-Lived Intangible Assets [Line Items]
Amortization expense on other intangible assets	$ 900

XML

Goodwill and Intangibles - Schedule of Estimated Amortization Expense of Intangibles (Detail) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Goodwill and Intangible Assets Disclosure [Abstract]
Remaining in 2017	$ 2,287
2018	2,965
2019	2,897
2020	2,701
2021	2,329
Thereafter	11,233
Total	$ 24,412	$ 23,708

XML

Associate (Employee) Benefit Plans - Additional Information (Detail)		3 Months Ended
	Mar. 31, 2014	Mar. 31, 2017
Postemployment Benefits [Abstract]
Requisite service period	10 years
Amortization of unrecognized gains losses exceed percentage		10.00%

XML

Associate (Employee) Benefit Plans - Schedule of Net Periodic Benefit Cost Components of Postretirement Benefits (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Business Acquisition [Line Items]
Service cost	$ 15	$ 15
Interest cost	19	19
Prior service cost amortization	(19)	(7)
Net gain recognition	(16)	(15)
Net periodic benefit cost	(1)	$ 12
Alliance
Business Acquisition [Line Items]
Service cost	10
Interest cost	75
Expected Return on Plan Assets	(135)
Prior service cost amortization	0
Net gain recognition	0
Net periodic benefit cost	$ (50)

XML

Income Taxes - Additional Information (Detail) - USD ($)	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016
Income Tax Examination [Line Items]
Unrecognized tax benefits	$ 0
Amortization method qualified affordable housing project investments, amortization	400,000	$ 400,000
Tax benefits recorded as income tax expense	100,000
Carrying value of investment in affordable housing credits	15,000,000		$ 15,400,000
Tax Credit
Income Tax Examination [Line Items]
Affordable housing tax credits	$ 400,000

XML

Stock-Based Compensation - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended		12 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2016	Dec. 31, 2012
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	$ 0.9	$ 0.8
Share-based compensation expense, net of tax	$ 0.6	0.4
Stock Incentive Plan 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options, outstanding (in shares)	2,096,535
Number of shares available for grant (in shares)	490,926
Share based payment awards performance period	4 years
Employee Stock Option | Stock Incentive Plan 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options, outstanding (in shares)	1,474,752				1,547,980
Share-based compensation expense	$ 0.5
Award vesting rights	25.00%
Award vesting period	1 year
Expiration period	7 years
Compensation not yet recognized	$ 5.5
Compensation cost not yet recognized, period for recognition	1 year 10 months 10 days
Restricted Stock Units (RSUs) | Stock Incentive Plan 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	$ 0.1
Award vesting rights	25.00%
Award vesting period	4 years
Number of shares authorized (in shares)						233,400
Percentage of annual return on assets				1.00%
Stock issued during period (in shares)			108,456
Restricted Stock And Restricted Stock Units | Stock Incentive Plan 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	$ 0.2
Compensation not yet recognized, Share-based awards other than options		$ 7.0
Weighted average remaining contractual terms	3 years 2 months
Minimum | Restricted Stock Units (RSUs) | Stock Incentive Plan 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period	4 years
Executive Officer | Minimum | Restricted Stock Units (RSUs) | Stock Incentive Plan 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period	4 years

XML

Stock-Based Compensation - Summary of Assumptions for Options Issued (Detail) - Stock Incentive Plan 2013 - Employee Stock Option	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected Term (in years)	5 years 3 months	5 years 3 months
Volatility	24.85%	29.60%
Weighted-average risk free interest rate	1.95%	1.24%
Dividend Yield	0.60%	0.80%

XML

Stock-Based Compensation - Summary of Options Including Non-Plan Stock Options (Detail) - Stock Incentive Plan 2013 - $ / shares	3 Months Ended
	Mar. 31, 2017	Dec. 31, 2016
Shares
Outstanding at end of period (in shares)	2,096,535
Employee Stock Option
Shares
Outstanding at beginning of period (in shares)	1,547,980
Granted (in shares)	45,134
Exercised (in shares)	(117,612)
Forfeited (in shares)	(750)
Outstanding at end of period (in shares)	1,474,752
Weighted- Average Exercise Price
Outstanding at beginning of period (in dollars per share)	$ 17.83
Granted (in dollars per share)	47.05
Exercised (in dollars per share)	15.47
Forfeited (in dollars per share)	15.83
Outstanding at end of period (in dollars per share)	$ 18.91
Nonvested at end of period (in shares)	424,459	704,421
Nonvested at end of period (in dollars per share)	$ 23.64	$ 19.08
Exercisable at end of period (in shares)	1,050,293
Exercisable at end of period (in dollars per share)	$ 17.00
Weighted-average fair value of options granted (in shares)	$ 11.50

XML

Stock-Based Compensation - Schedule of Nonvested Stock Option Outstanding (Detail) - Stock Incentive Plan 2013 - Employee Stock Option	3 Months Ended
	Mar. 31, 2017 $ / shares shares
Shares
Nonvested at beginning of period (in shares) | shares	704,421
Granted (in shares) | shares	45,134
Forfeited (in shares) | shares	(750)
Vested during period (in shares) | shares	(324,346)
Nonvested at end of period (in shares) | shares	424,459
Weighted- Average Exercise Price
Nonvested at beginning of period (in dollars per share) | $ / shares	$ 19.08
Granted (in dollars per share) | $ / shares	47.05
Forfeited (in dollars per share) | $ / shares	15.83
Vested during period (in dollars per share) | $ / shares	17.01
Nonvested at end of period (in dollars per share) | $ / shares	$ 23.64

XML

Stock-Based Compensation - Schedule of RSUs and RSAs (Detail) - Stock Incentive Plan 2013 - Restricted Stock And Restricted Stock Units	3 Months Ended
	Mar. 31, 2017 $ / shares shares
Units (in whole)
Outstanding at beginning of period (in shares) | shares	135,592
Granted (in shares) | shares	36,523
Vested (in shares) | shares	(33,803)
Forfeited (in shares) | shares	(1,823)
Outstanding at end of period (in shares) | shares	136,489
Weighted Average Grant-Date Fair Value per Unit
Outstanding at beginning of period (in dollars per share) | $ / shares	$ 27.14
Granted (in dollars per share) | $ / shares	47.05
Vested (in dollars per share) | $ / shares	20.22
Forfeited (in dollars per share) | $ / shares	27.21
Outstanding at end of period (in dollars per share) | $ / shares	$ 34.20

XML

Fair Value Disclosures - Schedule of Financial Instruments Carried at Fair Value (Detail) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	$ 789,125	$ 794,543
Total assets measured at fair value on a recurring basis	790,233	796,051
Other real estate owned	3,582	3,591
Loans held for sale	29,394	54,782
Impaired loans (collateral dependent),net	62,443	46,499
Total assets measured at fair value on a nonrecurring basis	95,419	104,872
Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Other liabilities	3,194	3,380
GSE | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	32,981	35,010
CMO
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	277,711	261,216
CMO | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	277,711	261,215
FNMA MBS
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	386,051	405,764
FNMA MBS | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	386,051	405,764
FHLMC MBS
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	64,171	63,514
FHLMC MBS | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	64,171	63,515
GNMA MBS
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	27,597	28,416
GNMA MBS | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	27,597	28,416
Other investments | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	614	623
Other assets | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	1,108	1,508
Quoted Prices in Active Markets for Identical Asset (Level 1)
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Total assets measured at fair value on a recurring basis	614	623
Other real estate owned	0	0
Loans held for sale	0	0
Impaired loans (collateral dependent),net	0	0
Total assets measured at fair value on a nonrecurring basis	0	0
Quoted Prices in Active Markets for Identical Asset (Level 1) | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Other liabilities	0	0
Quoted Prices in Active Markets for Identical Asset (Level 1) | GSE | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	0	0
Quoted Prices in Active Markets for Identical Asset (Level 1) | CMO | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	0	0
Quoted Prices in Active Markets for Identical Asset (Level 1) | FNMA MBS | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	0	0
Quoted Prices in Active Markets for Identical Asset (Level 1) | FHLMC MBS | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	0	0
Quoted Prices in Active Markets for Identical Asset (Level 1) | GNMA MBS | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	0	0
Quoted Prices in Active Markets for Identical Asset (Level 1) | Other investments | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	614	623
Quoted Prices in Active Markets for Identical Asset (Level 1) | Other assets | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	0	0
Significant Other Observable Inputs (Level 2)
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Total assets measured at fair value on a recurring basis	789,619	795,428
Other real estate owned	0	0
Loans held for sale	29,394	54,782
Impaired loans (collateral dependent),net	0	0
Total assets measured at fair value on a nonrecurring basis	29,394	54,782
Significant Other Observable Inputs (Level 2) | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Other liabilities	3,194	3,380
Significant Other Observable Inputs (Level 2) | GSE | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	32,981	35,010
Significant Other Observable Inputs (Level 2) | CMO | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	277,711	261,215
Significant Other Observable Inputs (Level 2) | FNMA MBS | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	386,051	405,764
Significant Other Observable Inputs (Level 2) | FHLMC MBS | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	64,171	63,515
Significant Other Observable Inputs (Level 2) | GNMA MBS | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	27,597	28,416
Significant Other Observable Inputs (Level 2) | Other investments | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	0	0
Significant Other Observable Inputs (Level 2) | Other assets | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	1,108	1,508
Significant Unobservable Inputs (Level 3)
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Total assets measured at fair value on a recurring basis	0	0
Other real estate owned	3,582	3,591
Loans held for sale	0	0
Impaired loans (collateral dependent),net	62,443	46,499
Total assets measured at fair value on a nonrecurring basis	66,025	50,090
Significant Unobservable Inputs (Level 3) | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Other liabilities	0	0
Significant Unobservable Inputs (Level 3) | GSE | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	0	0
Significant Unobservable Inputs (Level 3) | CMO | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	0	0
Significant Unobservable Inputs (Level 3) | FNMA MBS | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	0	0
Significant Unobservable Inputs (Level 3) | FHLMC MBS | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	0	0
Significant Unobservable Inputs (Level 3) | GNMA MBS | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	0	0
Significant Unobservable Inputs (Level 3) | Other investments | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	0	0
Significant Unobservable Inputs (Level 3) | Other assets | Fair Value, Measurements, Recurring
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Investment securities available for sale	$ 0	$ 0

XML

Fair Value Disclosures - Additional Information (Detail)			3 Months Ended
	Mar. 31, 2017 USD ($) secuirty	Dec. 31, 2016 USD ($)	Mar. 31, 2017 USD ($) secuirty
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investment securities available for sale	$ 789,125,000	$ 794,543,000	$ 789,125,000
Minimum discount rate on appraisals of collateral securing loan			10.00%
Maximum discount rate on appraisals of collateral securing loan			50.00%
Ending Loan Balances	67,743,000	51,600,000	$ 67,743,000
Related Reserve	5,300,000	3,405,000	5,300,000
Collateral for collateral dependent loans	62,443,000	46,499,000	62,443,000
Commitments of lending operations	0	0
U.S. Treasury Notes | AAA-Rated
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investment securities available for sale	33,000,000		33,000,000
Federal Agency MBS | AAA-Rated
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investment securities available for sale	755,500,000		755,500,000
Collateral Dependent Impaired Loans
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Ending Loan Balances		49,904,000
Visa | Common Class B
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Estimated value of shares	23,100,000		23,100,000
Quoted Prices in Active Markets for Identical Asset (Level 1)
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Collateral for collateral dependent loans	$ 0	$ 0	$ 0
Penn Liberty Financial Corporation | Quoted Prices in Active Markets for Identical Asset (Level 1)
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Available-for-sale securities, security | secuirty	1		1

XML

Fair Value Disclosures - Book Value and Estimated Fair Value of Financial Instruments (Detail) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Financial assets:
Investment securities available for sale	$ 789,125	$ 794,543
Investment securities held to maturity	163,611	164,346
Loans, held for sale	29,394	54,782
Loans, net	4,552,151	4,444,375
Impaired loans, net	62,443	46,499
Stock in FHLB of Pittsburgh	20,002	38,248
Accrued interest receivable	16,712	17,027
Other assets	81,793	84,892
Financial liabilities:
Deposits	5,376,830	4,738,438
Accrued interest payable	2,931	1,151
Quoted Prices in Active Markets for Identical Asset (Level 1)
Financial assets:
Loans, held for sale	0	0
Impaired loans, net	0	0
Significant Other Observable Inputs (Level 2)
Financial assets:
Loans, held for sale	29,394	54,782
Impaired loans, net	0	0
Significant Unobservable Inputs (Level 3)
Financial assets:
Loans, held for sale	0	0
Impaired loans, net	62,443	46,499
Book Value | Quoted Prices in Active Markets for Identical Asset (Level 1)
Financial assets:
Cash and cash equivalents	855,263	821,923
Book Value | Fair Value Inputs Level 1 And Level 2
Financial assets:
Investment securities available for sale	789,125	794,543
Book Value | Significant Other Observable Inputs (Level 2)
Financial assets:
Investment securities held to maturity	163,611	164,346
Loans, held for sale	29,394	54,782
Stock in FHLB of Pittsburgh	20,002	38,248
Accrued interest receivable	16,712	17,027
Financial liabilities:
Deposits	5,376,830	4,738,438
Borrowed funds	700,849	1,267,447
Accrued interest payable	2,931	1,151
Other liabilities	3,194	3,380
Book Value | Fair Value Inputs Level 2 And Level 3
Financial assets:
Loans, net	4,489,708	4,397,876
Book Value | Significant Unobservable Inputs (Level 3)
Financial assets:
Impaired loans, net	62,443	46,499
Other assets	13,920	9,189
Financial liabilities:
Standby letters of credit	507	468
Fair Value | Quoted Prices in Active Markets for Identical Asset (Level 1)
Financial assets:
Cash and cash equivalents	855,263	821,923
Fair Value | Fair Value Inputs Level 1 And Level 2
Financial assets:
Investment securities available for sale	789,125	794,543
Fair Value | Significant Other Observable Inputs (Level 2)
Financial assets:
Investment securities held to maturity	163,241	163,232
Loans, held for sale	29,394	54,782
Stock in FHLB of Pittsburgh	20,002	38,248
Accrued interest receivable	16,712	17,027
Financial liabilities:
Deposits	5,040,211	4,423,921
Borrowed funds	697,952	1,264,170
Accrued interest payable	2,931	1,151
Other liabilities	3,194	3,380
Fair Value | Fair Value Inputs Level 2 And Level 3
Financial assets:
Loans, net	4,450,924	4,300,963
Fair Value | Significant Unobservable Inputs (Level 3)
Financial assets:
Impaired loans, net	62,443	46,499
Other assets	28,527	15,787
Financial liabilities:
Standby letters of credit	$ 507	$ 468

XML

Derivative Financial Instruments - Fair Value of Derivative Instruments (Details) $ in Thousands	Mar. 31, 2017 USD ($) instrument	Dec. 31, 2016 USD ($)
Derivative [Line Items]
Notional	$ 538,700	$ 518,800
Designated as Hedging Instrument
Derivative [Line Items]
Count | instrument	3
Notional	$ 75,000
Liability Derivatives (Fair Value)	3,039
Other liabilities | Designated as Hedging Instrument
Derivative [Line Items]
Liability Derivatives (Fair Value)	$ 3,039

XML

Derivative Financial Instruments - Additional Information (Detail)	3 Months Ended
	Mar. 31, 2017 USD ($) instrument	Dec. 31, 2016 USD ($)
Derivative [Line Items]
Derivative hedge Ineffectiveness gain (loss)	$ 0
Interest rate cash flow hedge increase decrease interest expense to be reclassified during next 12 months net (less than)	100,000
Notional	538,700,000	$ 518,800,000
Collateral value against obligations	$ 3,400,000
Designated as Hedging Instrument
Derivative [Line Items]
Count | instrument	3
Notional	$ 75,000,000
Accrued Liabilities
Derivative [Line Items]
Termination value of derivatives	$ 3,000,000

XML

Derivative Financial Instruments - Effect of Derivative Instruments on the Income Statement (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Derivative [Line Items]
Amount of (Loss) or Gain Recognized in OCI on Derivative (Effective Portion)	$ (3,039)	$ 0
Interest Rate Products
Derivative [Line Items]
Amount of (Loss) or Gain Recognized in OCI on Derivative (Effective Portion)	$ (3,039)	$ 0

XML

Segment Information - Additional Information (Detail)	3 Months Ended
	Mar. 31, 2017 Business_Line Segment
Segment Reporting [Abstract]
Number of businesses | Segment	3
Number of business lines | Business_Line	6

XML

Segment Information - Details of Segment Information (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Segment Reporting Information [Line Items]
Interest income	$ 60,826	$ 50,046
Noninterest income	28,092	23,668
Total revenue	88,918	73,714
Interest expense	7,723	4,690
Noninterest expenses	51,506	43,797
Provision for loan losses	2,162	780
Total expenses	61,391	49,267
Income before taxes	27,527	24,447
Income tax provision	8,590	8,677
Net income	18,937	15,770
Capital expenditures	2,364	1,233
Inter-Segment Eliminations
Segment Reporting Information [Line Items]
Interest income	4,061	2,956
Noninterest income	2,391	2,277
Total revenue	6,452	5,233
Interest expense	4,061	2,956
Noninterest expenses	2,391	2,277
Total expenses	6,452	5,233
External Customer
Segment Reporting Information [Line Items]
Total revenue	95,370	78,947
Total expenses	67,843	54,500
WSFS Bank
Segment Reporting Information [Line Items]
Interest income	58,688	48,038
Noninterest income	10,167	9,852
Total revenue	68,855	57,890
Interest expense	7,463	4,497
Noninterest expenses	38,960	33,812
Provision for loan losses	1,716	815
Total expenses	48,139	39,124
Income before taxes	22,584	19,775
Capital expenditures	2,088	1,211
WSFS Bank | Inter-Segment Eliminations
Segment Reporting Information [Line Items]
Interest income	1,996	1,061
Noninterest income	2,164	2,060
Total revenue	4,160	3,121
Interest expense	2,065	1,895
Noninterest expenses	227	217
Total expenses	2,292	2,112
WSFS Bank | External Customer
Segment Reporting Information [Line Items]
Total revenue	73,015	61,011
Total expenses	50,431	41,236
Cash Connect
Segment Reporting Information [Line Items]
Interest income	0	0
Noninterest income	9,677	8,271
Total revenue	9,677	8,271
Interest expense	0	0
Noninterest expenses	6,135	5,448
Provision for loan losses	0	0
Total expenses	6,135	5,448
Income before taxes	1,613	1,746
Capital expenditures	22	20
Cash Connect | Inter-Segment Eliminations
Segment Reporting Information [Line Items]
Interest income	0	0
Noninterest income	191	193
Total revenue	191	193
Interest expense	1,405	555
Noninterest expenses	715	715
Total expenses	2,120	1,270
Cash Connect | External Customer
Segment Reporting Information [Line Items]
Total revenue	9,868	8,464
Total expenses	8,255	6,718
Wealth Management
Segment Reporting Information [Line Items]
Interest income	2,138	2,008
Noninterest income	8,248	5,545
Total revenue	10,386	7,553
Interest expense	260	193
Noninterest expenses	6,411	4,537
Provision for loan losses	446	(35)
Total expenses	7,117	4,695
Income before taxes	3,330	2,926
Capital expenditures	254	2
Wealth Management | Inter-Segment Eliminations
Segment Reporting Information [Line Items]
Interest income	2,065	1,895
Noninterest income	36	24
Total revenue	2,101	1,919
Interest expense	591	506
Noninterest expenses	1,449	1,345
Total expenses	2,040	1,851
Wealth Management | External Customer
Segment Reporting Information [Line Items]
Total revenue	12,487	9,472
Total expenses	$ 9,157	$ 6,546

XML

Segment Information - Details of Segment Information- Statement of Financial Condition (Details) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016	Mar. 31, 2016	Dec. 31, 2015
Segment Reporting Information [Line Items]
Cash and cash equivalents	$ 855,263	$ 821,923	$ 590,028	$ 561,179
Goodwill	165,960	167,539
Other segment assets	5,831,676	5,775,808
Total assets	6,852,899	6,765,270
WSFS Bank
Segment Reporting Information [Line Items]
Cash and cash equivalents	99,812	100,893
Goodwill	145,761	147,396
Other segment assets	5,608,912	5,545,611
Total assets	5,854,485	5,793,900
Cash Connect
Segment Reporting Information [Line Items]
Cash and cash equivalents	751,201	717,643
Goodwill	0	0
Other segment assets	4,097	3,533
Total assets	755,298	721,176
Wealth Management
Segment Reporting Information [Line Items]
Cash and cash equivalents	4,250	3,387
Goodwill	20,199	20,143
Other segment assets	218,667	226,664
Total assets	$ 243,116	$ 250,194

XML

Indemnifications and Guarantees - Additional Information (Detail)	3 Months Ended
	Mar. 31, 2017 USD ($) loan Financial_Institution Transaction	Mar. 31, 2016 USD ($)	Dec. 31, 2016 USD ($) loan
Guarantor Obligations [Line Items]
Provision for losses at the time of sale	$ 2,162,000	$ 780,000
Number of unrelated financial institutions | Financial_Institution	3
Derivative transaction held for guarantee | loan	134		134
Notional	$ 538,700,000		$ 518,800,000
Aggregate fair value of swaps to customers	10,000,000		$ 10,900,000
Reserves for swap guarantees	$ 0
Minimum
Guarantor Obligations [Line Items]
Notional amount maturity period	1 year
Maximum
Guarantor Obligations [Line Items]
Notional amount maturity period	20 years
Secondary Market Loan Sales
Guarantor Obligations [Line Items]
Provision for losses at the time of sale	$ 0
Number of loans repurchased | Transaction	0

XML

Change in Accumulated Other Comprehensive Income - Components of Accumulated Other Comprehensive (Loss) Income (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance	$ 687,336	$ 580,471
Ending Balance	704,001	597,580
Net change in investment securities available for sale
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance	(8,194)	(1,887)
Other comprehensive income (loss) before reclassifications	1,272	10,572
Less: Amounts reclassified from accumulated other comprehensive loss	(206)	(189)
Net current-period other comprehensive income (loss)	1,066	10,383
Ending Balance	(7,128)	8,496
Net change in securities held to maturity
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance	1,392	1,795
Other comprehensive income (loss) before reclassifications	0	0
Less: Amounts reclassified from accumulated other comprehensive loss	(101)	(103)
Net current-period other comprehensive income (loss)	(101)	(103)
Ending Balance	1,291	1,692
Net change in defined benefit plan
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance	957	788
Other comprehensive income (loss) before reclassifications	0	0
Less: Amounts reclassified from accumulated other comprehensive loss	(23)	478
Net current-period other comprehensive income (loss)	(23)	478
Ending Balance	934	1,266
Net change in fair value of derivative used for cash flow hedge
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance	(1,772)	0
Other comprehensive income (loss) before reclassifications	(112)	0
Less: Amounts reclassified from accumulated other comprehensive loss	0	0
Net current-period other comprehensive income (loss)	(112)	0
Ending Balance	(1,884)	0
Total
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance	(7,617)	696
Other comprehensive income (loss) before reclassifications	1,160	10,572
Less: Amounts reclassified from accumulated other comprehensive loss	(330)	186
Net current-period other comprehensive income (loss)	830	10,758
Ending Balance	$ (6,787)	$ 11,454

XML

Change in Accumulated Other Comprehensive Income - Components of Other Comprehensive (Loss) Income (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Realized gains on securities transactions	$ 320	$ 305
Income taxes	(8,590)	(8,677)
Income before taxes	27,527	24,447
Net income	18,937	15,770
Reclassification out of Accumulated Other Comprehensive Income
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Net income	(330)	186
Reclassification out of Accumulated Other Comprehensive Income | Net change in defined benefit plan
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Income taxes	12	(306)
Prior service (credits) costs	(19)	(7)
Actuarial (gains) losses	(16)	791
Income before taxes	(35)	784
Net income	(23)	478
Reclassification out of Accumulated Other Comprehensive Income | Realized Gains on Securities Transactions | Net change in investment securities available for sale
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Realized gains on securities transactions	(320)	(305)
Income taxes	114	116
Net income	(206)	(189)
Reclassification out of Accumulated Other Comprehensive Income | Amortization of Net Unrealized Gains to Income During Period | Net change in investment securities available for sale
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Income taxes	59	65
Amortization of net unrealized gains to income during the period	(160)	(168)
Net income	$ (101)	$ (103)

XML

Related Party Transactions - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Dec. 31, 2016
Related Party Transaction [Line Items]
Total deposits from related parties	$ 6.3	$ 3.6
Loans
Related Party Transaction [Line Items]
Related party loan repayment	1.6	$ 1.3
New Loans And Credit Line Advance To Related Parties
Related Party Transaction [Line Items]
New loans and credit line advance to related parties	0.4
Proceeds from Related Party Debt	$ 0.1

XML

Legal and Other Proceedings - Additional Information (Detail) - USD ($)		3 Months Ended
	Apr. 07, 2015	Mar. 31, 2017
Subsequent Event [Line Items]
Additions to other significant pending legal or other proceedings		$ 0
Universitas Education, LLC | Pending Litigation
Subsequent Event [Line Items]
Loss contingency, damages sought	$ 30,000,000