ACQUISITION OF BANK OF GASSAWAY

6 Months Ended

Jun. 30, 2014

ACQUISITION OF BANK OF GASSAWAY [Abstract]

ACQUISITION OF BANK OF GASSAWAY

NOTE  9 – ACQUISITION OF BANK OF GASSAWAY

Effective with the close of business on April 4, 2014, Premier completed its purchase of the Bank of Gassaway (“Gassaway”), a $201.52 million bank headquartered in Gassaway, West Virginia.  Under terms of an amended and restated agreement of merger dated January 3, 2014, Premier Bank, Inc., a wholly owned subsidiary of Premier, paid $20.25 million in cash for the Bank of Gassaway and merged Gassaway’s five branch locations into its operating systems.  The purchase price resulted in approximately $3.92 million in goodwill and $1.73 million in core deposit intangible, none of which is deductible for tax purposes.  The core deposit intangible will be amortized using an accelerated method.  The following table presents estimated amortization of the Gassaway core deposit intangible for each of the next five years.

2014	$	243
2015		279
2016		226
2017		193
2018		186
2019 and thereafter		603
Total core deposit intangible acquired	$	1,730

United States generally accepted accounting principles (“U.S. GAAP”) provides up to twelve months following the date of acquisition in which management can finalize the fair values of acquired assets and assumed liabilities. Material events that occur during the measurement period will be analyzed to determine if the new information reflected facts and circumstances that existed on the acquisition date. The measurement period ends as soon as the Company receives the information it was seeking about facts and circumstances that existed as of the acquisition date or learns more information is unobtainable. The measurement period is limited to one year from the acquisition date. Once management has finalized the fair values of acquired assets and assumed liabilities within this twelve month period, management considers such values to be the “Day One Fair Values.”.

Net assets acquired via the acquisition are shown in the table below.

	Gassaway
Cash and due from banks	$	61,223
Securities available for sale		38,741
Loans, net		95,094
Goodwill and other intangible assets		5,651
Other assets		5,089
Total assets acquired		205,798
Deposits		(184,555	)
Other liabilities		(993	)
Total liabilities assumed		(185,548	)
Net assets acquired	$	20,250

The fair value of net assets acquired includes fair value adjustments to certain receivables that were not considered impaired as of the acquisition date. The fair value adjustments were determined using discounted contractual cash flows.  Non-impaired loans with a fair value of $95,094,000 had gross contractual amounts receivable of $97,588,000 on the date of acquisition.