Virginia (State or other jurisdiction of incorporation or organization) | 54-1696103 (I.R.S. Employer Identification No.) | |
111 West Washington Street Middleburg, Virginia (Address of principal executive offices) | 20117 (Zip Code) |
Title of each class | Name of each exchange on which registered | |
Common Stock, par value $2.50 per share | Nasdaq Stock Market |
Large accelerated filer ¨ | Accelerated filer þ | |
Non-accelerated filer ¨ (Do not check if a smaller reporting company) | Smaller reporting company ¨ |
Page | |||
ITEM 1. | BUSINESS |
• | Loudoun County - 375,629 |
• | Fairfax County - 1,142,234 |
• | Fauquier County - 68,782 |
• | Prince William County - 451,721 |
• | 13.19% of the nearly $6.1 billion in deposits in Loudoun County. |
• | 1.24% of the nearly $5.0 billion in deposits in the Reston market. |
• | 6.55% of the nearly $1.5 billion in deposits in Fauquier County. |
• | 3.81% of the nearly $1.3 billion in deposits in James City County. |
• | 0.52% of the nearly $4.3 billion in deposits in Prince William County. |
• | 0.09% of the nearly $19.2 billion in deposits in the City of Richmond. |
• | banking and managing or controlling banks; |
• | furnishing services to or performing services for its subsidiaries; and |
• | engaging in other activities that the Federal Reserve has determined by regulation or order to be so closely related to banking as to be a proper incident to these activities. |
• | acquiring substantially all the assets of any bank; |
• | acquiring direct or indirect ownership or control of any voting shares of any bank if after such acquisition it would own or control more than 5% of the voting shares of such bank (unless it already owns or controls the majority of such shares); or |
• | merging or consolidating with another bank holding company. |
• | limit the extent to which a bank or its subsidiaries may engage in “covered transactions” with any one affiliate to an amount equal to 10% of such institution’s capital stock and surplus, and maintain an aggregate limit on all such transactions with affiliates to an amount equal to 20% of such capital stock and surplus; and |
• | require that all such transactions be on terms substantially the same, or at least as favorable, to the association or subsidiary as those provided to a non-affiliate. |
• | Insurance of Deposit Accounts. The Dodd-Frank Act changed the assessment base for federal deposit insurance from the amount of insured deposits to consolidated assets less tangible capital. The Dodd-Frank Act also made permanent the $250,000 limit for federal deposit insurance and increased the cash limit of Securities Investor Protection Corporation protection from $100,000 to $250,000. |
• | Payment of Interest on Demand Deposits. The Dodd-Frank Act repealed the federal prohibitions on the payment of interest on demand deposits, thereby permitting depository institutions to pay interest on business transaction and other accounts. |
• | Creation of the Consumer Financial Protection Bureau. The Dodd-Frank Act centralized significant aspects of consumer financial protection by creating a new agency, the CFPB, which is discussed in more detail below. |
• | Debit Card Interchange Fees. The Dodd-Frank Act amended the Electronic Fund Transfer Act (EFTA) to, among other things, require that debit card interchange fees be reasonable and proportional to the actual cost incurred by the issuer with respect to the transaction. The Federal Reserve Board adopted regulations setting the maximum permissible interchange fee as the sum of $0.21 per transaction and 5 basis points multiplied by the value of the transaction, with an additional adjustment of up to $0.01 per transaction if the issuer implements additional fraud-prevention standards. Although issuers that have assets of less than $10 billion are exempt from the Federal Reserve Board’s regulations that set maximum interchange fees, these regulations could significantly affect the interchange fees that financial institutions with less than $10 billion in assets are able to collect. |
• | Restrict the preemption of state law by federal law and disallow subsidiaries and affiliates of national banks from availing themselves of such preemption. |
• | Impose comprehensive regulation of over-the-counter derivatives market, subject to significant rulemaking processes, which would include certain provisions that would effectively prohibit insured depository institutions from conducting certain derivatives businesses in the institution itself. |
• | Require depository institutions with total consolidated assets of more than $10 billion to conduct regular stress tests and require large, publicly traded bank holding companies to create a risk committee responsible for the oversight of enterprise risk management. |
• | Require loan originators to retain 5% of any loan sold or securitized, unless it is a “qualified residential mortgage,” subject to certain exceptions. |
• | Prohibit banks and their affiliates from engaging in proprietary trading and investing in and sponsoring certain unregistered investment companies (the Volcker Rule). |
• | Implement corporate governance revisions that apply to all public companies not just financial institutions. |
• | engaging in short-term proprietary trading of securities, derivatives, commodity futures and options on these instruments for their own account; |
• | owning, sponsoring, or having certain relationships with hedge funds or private equity funds, referred to as “covered funds”. |
ITEM 1A. | RISK FACTORS |
• | open new financial service centers; |
• | attract deposits to those locations; and |
• | identify attractive loan and investment opportunities. |
• | excessive upfront points and fees (those exceeding 3% of the total loan amount, less “bona fide discount points” for prime loans); |
• | interest-only payments; |
• | negative-amortization; and |
• | terms longer than 30 years. |
• | actual loan loss history; |
• | volume, growth, and composition of the loan portfolio; |
• | the amount of nonperforming loans and the value of their related collateral; |
• | the effect of changes in the local real estate market on collateral values; |
• | the effect of current economic conditions on a borrower’s ability to pay; and |
• | other factors deemed relevant by management. |
ITEM 1B. | UNRESOLVED STAFF COMMENTS |
ITEM 2. | PROPERTIES |
ITEM 3. | LEGAL PROCEEDINGS |
ITEM 4. | MINE SAFETY DISCLOSURES |
ITEM 5. | MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES |
Sales Price ($) | Dividends ($) | |||||||||
High | Low | |||||||||
2016: | 1st quarter | $ | 22.35 | $ | 18.02 | $ | 0.13 | |||
2nd quarter | 27.69 | 22.00 | 0.13 | |||||||
3rd quarter | 29.24 | 26.47 | 0.13 | |||||||
4th quarter | 36.66 | 27.18 | 0.13 | |||||||
2015: | 1st quarter | $ | 18.50 | $ | 17.90 | $ | 0.10 | |||
2nd quarter | 18.90 | 17.41 | 0.10 | |||||||
3rd quarter | 18.67 | 16.60 | 0.13 | |||||||
4th quarter | 18.89 | 17.20 | 0.13 |
(Dollars in thousands, except for per share amounts) | Total number of shares purchased | Average price paid per share ($) | Total number of shares purchased as part of a publicly announced plan | Approximate value of shares that may yet be purchased under the plan | ||||||||||
January 1, 2016 - January 31, 2016 | 26,800 | $ | 18.29 | 26,800 | $ | 8,088,000 |
Period Ending December 31, | |||||||
Index | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | |
Middleburg Financial Corporation | 100.00 | 125.47 | 129.77 | 131.96 | 138.84 | 266.27 | |
NASDAQ Composite | 100.00 | 117.45 | 164.57 | 188.84 | 201.98 | 219.89 | |
SNL Bank $1B-$5B | 100.00 | 123.31 | 179.31 | 187.48 | 209.86 | 301.92 |
ITEM 6. | SELECTED FINANCIAL DATA |
Years Ended December 31, | |||||||||||||||||||
(In thousands, except per share data) | 2016 | 2015 | 2014 | 2013 | 2012 | ||||||||||||||
Balance Sheet Data: | |||||||||||||||||||
Assets | $ | 1,272,643 | $ | 1,294,863 | $ | 1,222,857 | $ | 1,227,753 | $ | 1,236,781 | |||||||||
Loans, net | 848,693 | 794,635 | 743,060 | 715,160 | 695,166 | ||||||||||||||
Loans held for sale | — | — | — | 33,175 | 82,114 | ||||||||||||||
Securities | 316,792 | 385,189 | 355,042 | 335,203 | 326,447 | ||||||||||||||
Deposits | 1,053,058 | 1,040,800 | 989,080 | 982,396 | 981,900 | ||||||||||||||
Shareholders’ equity | 126,679 | 123,554 | 122,034 | 115,073 | 117,122 | ||||||||||||||
Average shares outstanding, basic | 7,107 | 7,147 | 7,106 | 7,074 | 7,032 | ||||||||||||||
Average shares outstanding, diluted | 7,151 | 7,167 | 7,127 | 7,107 | 7,043 | ||||||||||||||
Income Statement Data: | |||||||||||||||||||
Interest income | $ | 43,375 | $ | 42,281 | $ | 43,325 | $ | 44,272 | $ | 47,023 | |||||||||
Interest expense | 4,424 | 4,207 | 5,243 | 6,567 | 8,824 | ||||||||||||||
Net interest income | 38,951 | 38,074 | 38,082 | 37,705 | 38,199 | ||||||||||||||
Provision for loan losses | 1,853 | 2,293 | 1,960 | 109 | 3,438 | ||||||||||||||
Net Interest income after provision for loan losses | 37,098 | 35,781 | 36,122 | 37,596 | 34,761 | ||||||||||||||
Non-interest income | 9,184 | 9,481 | 14,080 | 24,121 | 29,009 | ||||||||||||||
Securities gains | 1,554 | 140 | 186 | 418 | 445 | ||||||||||||||
Non-interest expense | 36,959 | 34,857 | 40,561 | 54,041 | 54,259 | ||||||||||||||
Income before income taxes and non-controlling interest in consolidated subsidiary | 10,877 | 10,545 | 9,827 | 8,094 | 9,956 | ||||||||||||||
Income taxes | 2,813 | 2,715 | 2,341 | 1,931 | 1,966 | ||||||||||||||
Non-controlling interest in consolidated subsidiary (income) loss | — | — | 98 | (9 | ) | (1,504 | ) | ||||||||||||
Net income | 8,064 | 7,830 | 7,584 | 6,154 | 6,486 | ||||||||||||||
Per Share Data: | |||||||||||||||||||
Net income, basic | $ | 1.13 | $ | 1.10 | $ | 1.07 | $ | 0.87 | $ | 0.92 | |||||||||
Net income, diluted | 1.13 | 1.09 | 1.06 | 0.87 | 0.92 | ||||||||||||||
Cash dividends | 0.52 | 0.46 | 0.34 | 0.24 | 0.20 | ||||||||||||||
Book value | 17.58 | 17.44 | 17.11 | 15.90 | 16.15 | ||||||||||||||
Tangible book value (2) | 17.10 | 16.93 | 16.58 | 15.14 | 15.30 | ||||||||||||||
Asset Quality Ratios: | |||||||||||||||||||
Nonperforming loans to total loans | 2.51 | % | 2.62 | % | 1.89 | % | 3.46 | % | 3.92 | % | |||||||||
Nonperforming assets to total assets | 2.16 | 1.97 | 1.59 | 2.33 | 3.05 | ||||||||||||||
Net charge-offs to average loans | 0.18 | 0.39 | 0.46 | 0.15 | 0.54 | ||||||||||||||
Allowance for loan losses to gross loans | 1.33 | 1.37 | 1.56 | 1.83 | 2.02 | ||||||||||||||
Selected Ratios: | |||||||||||||||||||
Return on average assets | 0.61 | % | 0.62 | % | 0.62 | % | 0.51 | % | 0.54 | % | |||||||||
Return on average equity | 6.34 | 6.25 | 6.40 | 5.40 | 5.86 | ||||||||||||||
Dividend payout | 46.02 | 42.20 | 32.08 | 27.60 | 21.70 | ||||||||||||||
Efficiency ratio (1) | 73.80 | 70.86 | 75.10 | 82.12 | 73.86 | ||||||||||||||
Equity to assets (including non-controlling interest in consolidated subsidiary) | 9.95 | 9.54 | 9.98 | 9.37 | 9.47 | ||||||||||||||
Tier 1 risk-based capital ratio | 16.61 | 16.27 | 15.70 | 14.64 | 14.09 | ||||||||||||||
Common equity tier 1 capital ratio | 15.97 | 15.61 | N/A | N/A | N/A | ||||||||||||||
Total risk-based capital ratio | 17.86 | 17.52 | 16.95 | 15.89 | 15.35 | ||||||||||||||
Leverage ratio | 9.95 | 9.59 | 9.90 | 9.43 | 9.10 |
(1) | The ratio is calculated by dividing non-interest expense (adjusted for amortization of intangibles, other real estate expenses, and non-recurring one-time charges) by the sum of tax equivalent net interest income and non-interest income excluding gains and losses on the investment portfolio. |
(2) | Tangible book value is computed by subtracting identified intangible assets and goodwill from total Middleburg Financial Corporation shareholders’ equity and then dividing the result by the number of shares of common stock issued and outstanding at the end of the accounting period. |
ITEM 7. | MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITON AND RESULTS OF OPERATIONS |
Years Ended December 31, | ||||||||||||||||||||||||||||||||
2016 | 2015 | 2014 | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Average Balance | Income/ Expense | Yield/ Rate (2) | Average Balance | Income/ Expense | Yield/ Rate (2) | Average Balance | Income/ Expense | Yield/ Rate (2) | |||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||
Securities: | ||||||||||||||||||||||||||||||||
Taxable | $ | 320,250 | $ | 7,716 | 2.41 | % | $ | 319,705 | $ | 7,893 | 2.47 | % | $ | 282,198 | $ | 7,193 | 2.55 | % | ||||||||||||||
Tax-exempt (1) | 50,373 | 2,576 | 5.11 | % | 51,732 | 2,732 | 5.28 | % | 56,729 | 3,238 | 5.71 | % | ||||||||||||||||||||
Total securities | $ | 370,623 | $ | 10,292 | 2.78 | % | $ | 371,437 | $ | 10,625 | 2.86 | % | $ | 338,927 | $ | 10,431 | 3.08 | % | ||||||||||||||
Loans: | ||||||||||||||||||||||||||||||||
Taxable | $ | 834,810 | $ | 33,773 | 4.05 | % | $ | 771,207 | $ | 32,457 | 4.21 | % | $ | 741,028 | $ | 33,810 | 4.56 | % | ||||||||||||||
Tax-exempt (1) | 604 | 33 | 5.46 | % | 609 | 33 | 5.42 | % | 643 | 34 | 5.29 | % | ||||||||||||||||||||
Total loans (3) | $ | 835,414 | $ | 33,806 | 4.05 | % | $ | 771,816 | $ | 32,490 | 4.21 | % | $ | 741,671 | $ | 33,844 | 4.56 | % | ||||||||||||||
Interest-bearing deposits with other institutions | 40,672 | 164 | 0.40 | % | 49,201 | 106 | 0.22 | % | 71,275 | 162 | 0.23 | % | ||||||||||||||||||||
Total earning assets | $ | 1,246,709 | $ | 44,262 | 3.55 | % | $ | 1,192,454 | $ | 43,221 | 3.62 | % | $ | 1,151,873 | $ | 44,437 | 3.86 | % | ||||||||||||||
Less: allowances for loan losses | (11,311 | ) | (11,853 | ) | (12,241 | ) | ||||||||||||||||||||||||||
Total non-earning assets | 80,980 | 77,456 | 77,834 | |||||||||||||||||||||||||||||
Total assets | $ | 1,316,378 | $ | 1,258,057 | $ | 1,217,466 | ||||||||||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||||||||
Interest-bearing deposits: | ||||||||||||||||||||||||||||||||
Checking | $ | 351,764 | $ | 767 | 0.22 | % | $ | 343,026 | $ | 693 | 0.20 | % | $ | 339,996 | $ | 651 | 0.19 | % | ||||||||||||||
Regular savings | 130,357 | 241 | 0.18 | % | 119,989 | 223 | 0.19 | % | 113,363 | 212 | 0.19 | % | ||||||||||||||||||||
Money market savings | 77,763 | 185 | 0.24 | % | 70,239 | 136 | 0.19 | % | 73,232 | 139 | 0.19 | % | ||||||||||||||||||||
Time deposits: | ||||||||||||||||||||||||||||||||
$100,000 and over | 146,406 | 1,290 | 0.88 | % | 138,860 | 1,220 | 0.88 | % | 125,904 | 1,232 | 0.98 | % | ||||||||||||||||||||
Under $100,000 | 111,097 | 1,052 | 0.95 | % | 106,023 | 1,190 | 1.12 | % | 129,021 | 1,655 | 1.28 | % | ||||||||||||||||||||
Total interest-bearing deposits | $ | 817,387 | $ | 3,535 | 0.43 | % | $ | 778,137 | $ | 3,462 | 0.44 | % | $ | 781,516 | $ | 3,889 | 0.50 | % | ||||||||||||||
Securities sold under agreements to repurchase | 31,076 | 3 | 0.01 | % | 30,095 | 64 | 0.21 | % | 36,899 | 318 | 0.86 | % | ||||||||||||||||||||
FHLB borrowings and subordinated debt | 79,751 | 886 | 1.11 | % | 68,977 | 681 | 0.99 | % | 70,141 | 1,036 | 1.48 | % | ||||||||||||||||||||
Federal funds purchased | 15 | — | — | 1 | — | — | 1 | — | — | |||||||||||||||||||||||
Total interest-bearing liabilities | $ | 928,229 | $ | 4,424 | 0.48 | % | $ | 877,210 | $ | 4,207 | 0.48 | % | $ | 888,557 | $ | 5,243 | 0.59 | % | ||||||||||||||
Non-interest bearing liabilities | ||||||||||||||||||||||||||||||||
Demand deposits | 247,214 | 241,996 | 199,273 | |||||||||||||||||||||||||||||
Other liabilities | 13,832 | 13,602 | 11,059 | |||||||||||||||||||||||||||||
Total liabilities | $ | 1,189,275 | $ | 1,132,808 | $ | 1,098,889 | ||||||||||||||||||||||||||
Shareholders’ equity | 127,103 | 125,249 | 118,577 | |||||||||||||||||||||||||||||
Total liabilities and Shareholders’ equity | $ | 1,316,378 | $ | 1,258,057 | $ | 1,217,466 | ||||||||||||||||||||||||||
Net interest income (1) | $ | 39,838 | $ | 39,014 | $ | 39,194 | ||||||||||||||||||||||||||
Interest rate spread | 3.07 | % | 3.14 | % | 3.27 | % | ||||||||||||||||||||||||||
Interest expense as a percent of average earning assets | 0.35 | % | 0.35 | % | 0.46 | % | ||||||||||||||||||||||||||
Net interest margin | 3.20 | % | 3.27 | % | 3.40 | % |
(1) | Income and yields are reported on a tax equivalent basis assuming a federal tax rate of 34%. |
(2) | Yields and rates have been annualized on a 366 day year for 2016 and a 365 day year for 2015 and 2014. |
(3) | Total average loans include loans on nonaccrual status. |
For the Years Ended December 31, | ||||||||||||
(Dollars in thousands) | 2016 | 2015 | 2014 | |||||||||
GAAP measures: | ||||||||||||
Interest income - loans | $ | 33,795 | $ | 32,479 | $ | 33,833 | ||||||
Interest income - investments & other | 9,580 | 9,802 | 9,492 | |||||||||
Interest expense - deposits | 3,535 | 3,462 | 3,889 | |||||||||
Interest expense - other borrowings | 889 | 745 | 1,354 | |||||||||
Net Interest Income | $ | 38,951 | $ | 38,074 | $ | 38,082 | ||||||
Plus: | ||||||||||||
Non-GAAP measures: | ||||||||||||
Tax Benefit Realized on: | ||||||||||||
Non-taxable interest income - municipal securities | $ | 876 | $ | 929 | $ | 1,101 | ||||||
Non-taxable interest income - loans | 11 | 11 | 11 | |||||||||
Tax Benefit Realized on Non-Taxable Interest Income | $ | 887 | $ | 940 | $ | 1,112 | ||||||
Tax Equivalent Net Interest Income | $ | 39,838 | $ | 39,014 | $ | 39,194 |
Years Ended December 31, | ||||||||||||||||||||||||
(Dollars in thousands) | 2016 vs. 2015 Increase (Decrease) Due to Changes in: | 2015 vs. 2014 Increase (Decrease) Due to Changes in: | ||||||||||||||||||||||
Volume | Rate | Total | Volume | Rate | Total | |||||||||||||||||||
Earning Assets: | ||||||||||||||||||||||||
Securities: | ||||||||||||||||||||||||
Taxable | $ | 14 | $ | (191 | ) | $ | (177 | ) | $ | 917 | $ | (217 | ) | $ | 700 | |||||||||
Tax-exempt (1) | (71 | ) | (85 | ) | (156 | ) | (274 | ) | (232 | ) | (506 | ) | ||||||||||||
Loans: | ||||||||||||||||||||||||
Taxable | 2,481 | (1,165 | ) | 1,316 | 1,495 | (2,848 | ) | (1,353 | ) | |||||||||||||||
Tax-exempt (1) | — | — | — | (2 | ) | 1 | (1 | ) | ||||||||||||||||
Interest bearing deposits with other institutions | (14 | ) | 72 | 58 | (48 | ) | (8 | ) | (56 | ) | ||||||||||||||
Total earning assets | $ | 2,410 | $ | (1,369 | ) | $ | 1,041 | $ | 2,088 | $ | (3,304 | ) | $ | (1,216 | ) | |||||||||
Interest-Bearing Liabilities: | ||||||||||||||||||||||||
Checking | $ | 18 | $ | 56 | $ | 74 | $ | 6 | $ | 36 | $ | 42 | ||||||||||||
Regular savings | 19 | (1 | ) | 18 | 12 | (1 | ) | 11 | ||||||||||||||||
Money market savings | 16 | 33 | 49 | (6 | ) | 3 | (3 | ) | ||||||||||||||||
Time deposits: | ||||||||||||||||||||||||
$100,000 and over | 66 | 4 | 70 | 127 | (139 | ) | (12 | ) | ||||||||||||||||
Under $100,000 | 61 | (199 | ) | (138 | ) | (273 | ) | (192 | ) | (465 | ) | |||||||||||||
Total interest-bearing deposits | $ | 180 | $ | (107 | ) | $ | 73 | $ | (134 | ) | $ | (293 | ) | $ | (427 | ) | ||||||||
Securities sold under agreements to repurchase | 2 | (63 | ) | (61 | ) | (50 | ) | (204 | ) | (254 | ) | |||||||||||||
FHLB borrowings and subordinated debt | 114 | 91 | 205 | (17 | ) | (338 | ) | (355 | ) | |||||||||||||||
Total interest-bearing liabilities | $ | 296 | $ | (79 | ) | $ | 217 | $ | (201 | ) | $ | (835 | ) | $ | (1,036 | ) | ||||||||
Change in net interest income | $ | 2,114 | $ | (1,290 | ) | $ | 824 | $ | 2,289 | $ | (2,469 | ) | $ | (180 | ) |
(Dollars in thousands) | Years Ended December 31, | |||||||||||
2016 | 2015 | 2014 | ||||||||||
Service charges on deposit accounts | $ | 1,154 | $ | 1,061 | $ | 1,163 | ||||||
Trust services income | 4,643 | 4,785 | 4,362 | |||||||||
ATM fee income, net | 762 | 797 | 739 | |||||||||
Gains (losses) on sales of loans held for sale, net | 32 | (1 | ) | 4,860 | ||||||||
Gains on sales of securities available for sale, net | 1,554 | 140 | 186 | |||||||||
Commissions on investment sales | 555 | 547 | 611 | |||||||||
Bank owned life insurance | 652 | 656 | 662 | |||||||||
Gain on sale of majority interest in consolidated subsidiary | — | — | 24 | |||||||||
Other operating income | 1,386 | 1,636 | 1,659 | |||||||||
Total non-interest income | $ | 10,738 | $ | 9,621 | $ | 14,266 |
(Dollars in thousands) | Years Ended December 31, | ||||||||||
2016 | 2015 | 2014 | |||||||||
Salaries and employee benefits | $ | 18,757 | $ | 18,435 | $ | 22,601 | |||||
Occupancy and equipment | 4,881 | 5,106 | 6,177 | ||||||||
Advertising | 200 | 288 | 365 | ||||||||
Amortization | 1,211 | 1,001 | 791 | ||||||||
Computer operations | 2,582 | 2,337 | 1,893 | ||||||||
Other real estate owned, net | 363 | 284 | 256 | ||||||||
Other taxes | 947 | 915 | 849 | ||||||||
Federal deposit insurance | 748 | 786 | 899 | ||||||||
Audits and exams | 589 | 585 | 630 | ||||||||
Legal and advisory fees | 1,202 | 1,029 | 1,324 | ||||||||
Merger related expenses | 1,289 | — | — | ||||||||
Other operating expenses | 4,190 | 4,091 | 4,776 | ||||||||
Total non-interest expense | $ | 36,959 | $ | 34,857 | $ | 40,561 |
2016 Quarter Ended | |||||||||||||||
(Dollars in thousands except per share data) | March 31 | June 30 | September 30 | December 31 | |||||||||||
Net interest income | $ | 9,749 | $ | 9,969 | $ | 9,617 | $ | 9,616 | |||||||
Net interest income after provision for loan losses | 9,449 | 9,919 | 9,914 | 7,816 | |||||||||||
Other income | 2,045 | 2,160 | 2,106 | 2,873 | |||||||||||
Net securities gains | 163 | 210 | 138 | 1,043 | |||||||||||
Other expense | 9,014 | 8,751 | 9,174 | 10,020 | |||||||||||
Income before income taxes | 2,643 | 3,538 | 2,984 | 1,712 | |||||||||||
Net income | $ | 2,055 | $ | 2,653 | $ | 2,264 | $ | 1,092 | |||||||
Diluted earnings per common share | $ | 0.29 | $ | 0.37 | $ | 0.32 | $ | 0.15 | |||||||
Dividends per common share | 0.13 | 0.13 | 0.13 | 0.13 |
2015 Quarter Ended | |||||||||||||||
(Dollars in thousands except per share data) | March 31 | June 30 | September 30 | December 31 | |||||||||||
Net interest income | $ | 9,631 | $ | 9,313 | $ | 9,659 | $ | 9,471 | |||||||
Net interest income after provision for loan losses | 9,181 | 9,738 | 10,091 | 6,771 | |||||||||||
Other income | 2,754 | 2,201 | 2,171 | 2,355 | |||||||||||
Net securities gains | 101 | 37 | — | 2 | |||||||||||
Other expense | 8,748 | 8,881 | 9,090 | 8,138 | |||||||||||
Income before income taxes | 3,289 | 3,095 | 3,171 | 990 | |||||||||||
Net income | $ | 2,448 | $ | 2,280 | $ | 2,321 | $ | 781 | |||||||
Diluted earnings per common share | $ | 0.34 | $ | 0.32 | $ | 0.32 | $ | 0.11 | |||||||
Dividends per common share | 0.10 | 0.10 | 0.13 | 0.13 |
2014 Quarter Ended | |||||||||||||||
(Dollars in thousands except per share data) | March 31 | June 30 | September 30 | December 31 | |||||||||||
Net interest income | $ | 9,711 | $ | 9,510 | $ | 9,545 | $ | 9,316 | |||||||
Net interest income after provision for loan losses | 8,823 | 9,438 | 8,995 | 8,866 | |||||||||||
Other income | 5,687 | 4,073 | 2,108 | 2,212 | |||||||||||
Net securities gains | 63 | 66 | 12 | 45 | |||||||||||
Other expense | 12,004 | 10,997 | 8,231 | 9,329 | |||||||||||
Income before income taxes | 2,569 | 2,580 | 2,884 | 1,794 | |||||||||||
Net income | 1,820 | 1,913 | 2,121 | 1,632 | |||||||||||
Net (income) loss attributable to non-controlling interest | 157 | (59 | ) | — | — | ||||||||||
Net income attributable to Middleburg Financial Corporation | $ | 1,977 | $ | 1,854 | $ | 2,121 | $ | 1,632 | |||||||
Diluted earnings per common share | $ | 0.28 | $ | 0.26 | $ | 0.30 | $ | 0.22 | |||||||
Dividends per common share | 0.07 | 0.07 | 0.10 | 0.10 |
Years Ended December 31, | |||||||||||||||||||
(Dollars in thousands) | 2016 | 2015 | 2014 | 2013 | 2012 | ||||||||||||||
Real estate loans: | |||||||||||||||||||
Construction | $ | 35,627 | $ | 39,673 | $ | 33,050 | $ | 36,025 | $ | 50,218 | |||||||||
Secured by farmland | 16,768 | 19,062 | 19,708 | 16,578 | 11,876 | ||||||||||||||
Secured by 1-4 family residential | 314,045 | 280,096 | 265,216 | 273,384 | 260,620 | ||||||||||||||
Other real estate loans | 283,613 | 258,035 | 255,236 | 260,333 | 254,930 | ||||||||||||||
Commercial loans | 190,767 | 190,482 | 163,269 | 129,554 | 118,573 | ||||||||||||||
Consumer loans | 19,277 | 18,333 | 18,367 | 12,606 | 13,260 | ||||||||||||||
Total gross loans | 860,097 | 805,681 | 754,846 | 728,480 | 709,477 | ||||||||||||||
Less allowance for loan losses | 11,404 | 11,046 | 11,786 | 13,320 | 14,311 | ||||||||||||||
Net loans | $ | 848,693 | $ | 794,635 | $ | 743,060 | $ | 715,160 | $ | 695,166 |
• | Total loans were $860.1 million, an increase of 6.8% from $805.7 million as of December 31, 2015. |
• | Real estate construction loans consisted primarily of pre-sold 1-4 family residential loans and a marginal amount of commercial construction loans. These loans represented 4.1% of total loans, a decrease of approximately $4.0 million from $39.7 million. |
• | Loans secured by farmland decreased by $2.3 million from $19.1 million to $16.8 million. |
• | Loans secured by 1-4 family residential real estate represented 36.5% of total loans, an increase of $33.9 million. |
• | Other real estate loans are typically non-farm, non-residential real estate loans which are, in most cases, owner-occupied commercial buildings. Other real estate loans represented 33.0% of total loans, an increase of $25.6 million. |
• | Commercial loans, which consist of secured and unsecured loans to small businesses, increased by $285,000. |
• | Consumer loans increased by $944,000 compared to 2015. |
(Dollars in thousands) | Commercial, Financial and Agricultural | Real Estate Construction | |||||
Within 1 year | $ | 3,602 | $ | 4,626 | |||
Variable Rate: | |||||||
1-5 years | 28,474 | 10,006 | |||||
After 5 years | 70,337 | 10,302 | |||||
Total | 98,811 | 20,308 | |||||
Fixed Rate: | |||||||
1-5 years | 14,337 | 7,654 | |||||
After 5 years | 74,017 | 3,039 | |||||
Total | $ | 88,354 | $ | 10,693 | |||
Total Maturities | $ | 190,767 | $ | 35,627 |
• | All interest accrued but unpaid at the date the loan is placed on nonaccrual is either deducted from interest income or written-off as a loss. |
• | Accruals of interest are discontinued until it becomes certain that both principal and interest can be repaid. |
• | There may be actual losses that require additional provisions for loan losses to be charged against earnings. |
Years ended December 31, | |||||||||||||||||||
(Dollars in thousands) | 2016 | 2015 | 2014 | 2013 | 2012 | ||||||||||||||
Nonaccrual loans | $ | 8,359 | $ | 8,784 | $ | 9,944 | $ | 19,752 | $ | 21,664 | |||||||||
Restructured loans (1) | 12,410 | 12,058 | 4,295 | 4,674 | 5,132 | ||||||||||||||
Accruing loans greater than 90 days past due | 781 | 278 | 30 | 808 | 1,044 | ||||||||||||||
Total nonperforming loans | $ | 21,550 | $ | 21,120 | $ | 14,269 | $ | 25,234 | $ | 27,840 | |||||||||
Other real estate owned | 5,073 | 3,345 | 4,051 | 3,424 | 9,929 | ||||||||||||||
Repossessed Assets | 843 | 1,043 | 1,132 | — | — | ||||||||||||||
Total nonperforming assets | $ | 27,466 | $ | 25,508 | $ | 19,452 | $ | 28,658 | $ | 37,769 | |||||||||
Allowance for loan losses | $ | 11,404 | $ | 11,046 | $ | 11,786 | $ | 13,320 | $ | 14,311 | |||||||||
Nonperforming loans to gross loans | 2.5 | % | 2.6 | % | 1.9 | % | 3.5 | % | 3.9 | % | |||||||||
Allowance for loan losses to nonperforming loans | 52.9 | % | 52.3 | % | 82.6 | % | 52.8 | % | 51.4 | % | |||||||||
Nonperforming assets to total assets | 2.2 | % | 2.0 | % | 1.6 | % | 2.3 | % | 3.1 | % |
Years Ended December 31, | |||||||||||||||||||
(Dollars in thousands) | 2016 | 2015 | 2014 | 2013 | 2012 | ||||||||||||||
Balance, beginning of year | $ | 11,046 | $ | 11,786 | $ | 13,320 | $ | 14,311 | $ | 14,623 | |||||||||
Adjustment for the sale of majority interest in consolidated subsidiary | $ | — | $ | — | $ | (95 | ) | $ | — | $ | — | ||||||||
Provision for loan losses | $ | 1,853 | $ | 2,293 | $ | 1,960 | $ | 109 | $ | 3,438 | |||||||||
Charge-offs: | |||||||||||||||||||
Real estate loans: | |||||||||||||||||||
Construction | $ | 388 | $ | — | $ | 1,186 | $ | 394 | $ | 2,152 | |||||||||
Secured by 1-4 family residential | 1,021 | 344 | 1,380 | 785 | 893 | ||||||||||||||
Other real estate loans | 126 | 9 | 747 | 97 | 760 | ||||||||||||||
Commercial loans | 639 | 3,281 | 959 | 75 | 394 | ||||||||||||||
Consumer loans | 20 | 57 | 36 | 30 | 72 | ||||||||||||||
Total charge-offs | $ | 2,194 | $ | 3,691 | $ | 4,308 | $ | 1,381 | $ | 4,271 | |||||||||
Recoveries: | |||||||||||||||||||
Real estate loans: | |||||||||||||||||||
Construction | $ | 129 | $ | 246 | $ | 258 | $ | 68 | $ | 2 | |||||||||
Secured by 1-4 family residential | 395 | 359 | 342 | 140 | 388 | ||||||||||||||
Other real estate loans | 32 | 28 | 110 | 37 | 86 | ||||||||||||||
Commercial loans | 85 | 14 | 104 | 9 | 12 | ||||||||||||||
Consumer loans | 58 | 11 | 95 | 27 | 33 | ||||||||||||||
Total recoveries | $ | 699 | $ | 658 | $ | 909 | $ | 281 | $ | 521 | |||||||||
Net charge-offs | $ | 1,495 | $ | 3,033 | $ | 3,399 | $ | 1,100 | $ | 3,750 | |||||||||
Balance, end of year | $ | 11,404 | $ | 11,046 | $ | 11,786 | $ | 13,320 | $ | 14,311 | |||||||||
Allowance for loan losses to gross loans | 1.33 | % | 1.37 | % | 1.56 | % | 1.83 | % | 2.02 | % | |||||||||
Net charge-offs to average loans | 0.18 | % | 0.39 | % | 0.46 | % | 0.15 | % | 0.54 | % |
Real Estate Construction | Real Estate Secured by Farmland | 1-4 Family Residential | Other Real Estate Loans | Commercial | Consumer | |||||||||||||||||||||||||
Balance | % Total Loans | Balance | % Total Loans | Balance | % Total Loans | Balance | % Total Loans | Balance | % Total Loans | Balance | % Total Loans | |||||||||||||||||||
2016 | $ | 939 | 4.1 | % | $ | 127 | 2.0 | % | $ | 2,262 | 36.5 | % | $ | 3,167 | 33.0 | % | $ | 3,933 | 22.2 | % | $ | 976 | 2.2 | % | ||||||
2015 | 905 | 4.9 | 192 | 2.4 | 3,341 | 34.8 | 3,761 | 32.0 | 1,706 | 23.6 | 1,141 | 2.3 | ||||||||||||||||||
2014 | 550 | 4.4 | 179 | 2.6 | 3,966 | 35.1 | 3,916 | 33.8 | 2,354 | 21.6 | 821 | 2.5 | ||||||||||||||||||
2013 | 847 | 5.0 | 166 | 2.3 | 6,734 | 37.5 | 3,506 | 35.7 | 1,890 | 17.8 | 177 | 1.7 | ||||||||||||||||||
2012 | 1,258 | 7.1 | 135 | 1.7 | 6,276 | 36.7 | 4,348 | 35.9 | 2,098 | 16.8 | 196 | 1.8 |
Available for Sale | Years Ended December 31, | ||||||||||
(Dollars in thousands) | 2016 | 2015 | 2014 | ||||||||
U.S. government agency securities | $ | 73,184 | $ | 78,940 | $ | 41,397 | |||||
Obligations of states and political subdivisions | 63,373 | 75,593 | 57,740 | ||||||||
Mortgage-backed securities | 107,984 | 144,438 | 201,336 | ||||||||
Other securities | 57,026 | 75,600 | 47,790 | ||||||||
$ | 301,567 | $ | 374,571 | $ | 348,263 |
Held to Maturity | Years Ended December 31, | ||||||||||
(Dollars in thousands) | 2016 | 2015 | 2014 | ||||||||
Obligations of states and political subdivisions | $ | 6,433 | $ | 1,457 | $ | 1,500 | |||||
Corporate securities | 4,250 | 2,750 | — | ||||||||
$ | 10,683 | $ | 4,207 | $ | 1,500 |
Due in 1 year or less | Due after 1 year through 5 years | Due after 5 years through 10 years | Due after 10 years and Equities | Total | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Amount | Yield | Amount | Yield | Amount | Yield | Amount | Yield | Amount | Yield | ||||||||||||||||||||||||
Securities available for sale | ||||||||||||||||||||||||||||||||||
U.S. government agencies | $ | 340 | 46.47 | % | $ | 1,050 | 2.34 | % | $ | 6,765 | 2.43 | % | $ | 65,029 | 2.18 | % | $ | 73,184 | 1.85 | % | ||||||||||||||
Mortgage-backed securities | — | — | % | 4,641 | 3.01 | % | 513 | 3.84 | % | 102,830 | 2.29 | % | 107,984 | 2.29 | % | |||||||||||||||||||
Other (2) | 100 | 1.30 | % | 7,651 | 2.61 | % | 20,564 | 2.54 | % | 52,204 | 309.00 | % | 80,519 | 2.54 | % | |||||||||||||||||||
Total taxable | $ | 440 | 15.92 | % | $ | 13,342 | 2.65 | % | $ | 27,842 | 2.93 | % | $ | 220,063 | 2.52 | % | $ | 261,687 | 2.23 | % | ||||||||||||||
Tax-exempt securities (1) | 337 | 1.50 | % | 520 | 2.88 | % | 5,330 | 2.67 | % | 33,693 | 3.57 | % | 39,880 | 2.43 | % | |||||||||||||||||||
Total securities available for sale | $ | 777 | 12.32 | % | $ | 13,862 | 2.71 | % | $ | 33,172 | 2.87 | % | $ | 253,756 | 2.78 | % | $ | 301,567 | 2.28 | % | ||||||||||||||
Securities held to maturity | ||||||||||||||||||||||||||||||||||
Tax-exempt securities (1) | $ | — | — | % | $ | — | — | % | $ | — | — | % | $ | 6,433 | 2.58 | % | $ | 6,433 | 2.58 | % | ||||||||||||||
Other (2) | — | — | % | — | — | % | 4,250 | 6.13 | % | — | — | % | 4,250 | 6.13 | % | |||||||||||||||||||
Total securities held to maturity | $ | — | — | % | $ | — | — | % | $ | 4,250 | 6.13 | % | $ | 6,433 | 2.58 | % | $ | 10,683 | 3.99 | % |
(1) | Yields on tax-exempt securities, which includes tax-exempt obligations of states and political subdivisions have been computed on a tax-equivalent basis assuming a federal tax rate of 34%. |
(2) | Includes corporate securities, asset-backed securities and taxable obligations of states and political subdivisions. |
Years Ended December 31, | ||||||||||||||||||||
2016 | 2015 | 2014 | ||||||||||||||||||
(Dollars in thousands) | Amount | Rate | Amount | Rate | Amount | Rate | ||||||||||||||
Non-interest-bearing deposits | $ | 247,214 | $ | 241,996 | $ | 199,273 | ||||||||||||||
Interest-bearing deposits: | ||||||||||||||||||||
Checking | $ | 351,764 | 0.22 | % | $ | 343,026 | 0.20 | % | $ | 339,996 | 0.19 | % | ||||||||
Regular savings | 130,357 | 0.18 | % | 119,989 | 0.19 | % | 113,363 | 0.19 | % | |||||||||||
Money market savings | 77,763 | 0.24 | % | 70,239 | 0.19 | % | 73,232 | 0.19 | % | |||||||||||
Time deposits: | ||||||||||||||||||||
$ 100,000 and over | 146,406 | 0.88 | % | 138,860 | 0.88 | % | 125,904 | 0.98 | % | |||||||||||
Under $ 100,000 | 111,097 | 0.95 | % | 106,023 | 1.12 | % | 129,021 | 1.28 | % | |||||||||||
Total interest-bearing deposits | $ | 817,387 | 0.43 | % | $ | 778,137 | 0.44 | % | $ | 781,516 | 0.50 | % | ||||||||
Total | $ | 1,064,601 | $ | 1,020,133 | $ | 980,789 |
Within three months | Three to six months | Six to twelve months | Over one year | Total | Percent of total deposits | ||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||
$ | 19,064 | $ | 35,897 | $ | 63,886 | $ | 16,058 | $ | 134,905 | 12.8 | % |
(Dollars in thousands) | 2016 | 2015 | |||||
Financial instruments whose contract amounts represent credit risk: | |||||||
Commitments to extend credit | $ | 132,669 | $ | 153,806 | |||
Standby letters of credit | 4,998 | 3,718 |
(Dollars in thousands) | Payment due by period | ||||||||||||||||||
Total | Less than 1 year | 1 - 3 years | 3 - 5 years | More than 5 years | |||||||||||||||
Time deposits | $ | 225,640 | $ | 151,293 | $ | 63,864 | $ | 10,483 | $ | — | |||||||||
Securities sold under agreements to repurchase | 34,864 | 34,864 | — | — | — | ||||||||||||||
Federal Home Loan Bank borrowings | 39,500 | 29,500 | 10,000 | — | — | ||||||||||||||
Operating leases | 21,147 | 1,666 | 4,685 | 1,408 | 13,388 | ||||||||||||||
Subordinated notes | 5,155 | — | — | — | 5,155 | ||||||||||||||
Total Obligations | $ | 326,306 | $ | 217,323 | $ | 78,549 | $ | 11,891 | $ | 18,543 |
• | Total capital to risk-weighted assets was 17.9% and 17.5%, respectively. |
• | Tier 1 capital to risk-weighted assets was 16.6% and 16.3%, respectively. |
• | Common equity Tier 1 capital to risk weighted assets was 16.0% and 15.6%, respectively. |
• | Tier 1 capital to average assets (leverage ratio) was 10.0% and 9.6%, respectively. |
(Dollars in thousands) | Securities sold under agreements to repurchase | |||
At December 31: | ||||
2016 | $ | 34,864 | ||
2015 | 26,869 | |||
2014 | 38,551 | |||
Weighted-average interest rate at year-end: | ||||
2016 | 0.01 | % | ||
2015 | 0.01 | |||
2014 | 0.80 | |||
Maximum amount outstanding at any month's end: | ||||
2016 | $ | 35,660 | ||
2015 | 34,253 | |||
2014 | 43,989 | |||
Average amount outstanding during the year: | ||||
2016 | $ | 31,076 | ||
2015 | 30,095 | |||
2014 | 37,035 | |||
Weighted-average interest rate during the year: | ||||
2016 | 0.01 | % | ||
2015 | 0.21 | |||
2014 | 0.86 |
• | ability to obtain regulatory approvals and meet other closing conditions to the pending merger with Access; |
• | delays in closing the merger with Access; |
• | the inability to recognize cost savings or revenues or to implement integration plans associated with the merger with Access; |
• | deposit attrition, operating costs, customer losses and business disruption in connection with the merger, including adverse effects on relationships with employees; |
• | termination of the merger agreement, or failure to complete the merger, could negatively impact our stock price and our future business and financial results; |
• | further adverse changes in general economic and business conditions in the Company’s market area; |
• | changes in banking and other laws and regulations applicable to the Company; |
• | maintaining asset qualities; |
• | the ability to properly identify risks in our loan portfolio and calculate an adequate loan loss allowance; |
• | risks inherent in making loans such as repayment risks and fluctuating collateral values; |
• | concentration in loans secured by real estate; |
• | changing trends in customer profiles and behavior; |
• | changes in interest rates and interest rate policies; |
• | maintaining cost controls as the Company opens or acquires new facilities; |
• | competition with other banks and financial institutions, and companies outside of the banking industry, including those companies that have substantially greater access to capital and other resources; |
• | the ability to continue to attract low cost core deposits to fund asset growth; |
• | the ability to successfully manage the Company’s growth or implement its growth strategies if it is unable to identify attractive markets, locations or opportunities to expand in the future; |
• | reliance on the Company’s management team, including its ability to attract and retain key personnel; |
• | demand, development and acceptance of new products and services; |
• | problems with technology utilized by the Company; |
• | maintaining capital levels adequate to support the Company’s growth; and |
• | other factors described in Item 1A, “Risk Factors,” above. |
ITEM 7A. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
Estimated Net Interest Income Sensitivity | ||||
Rate Change | December 31, 2016 | December 31, 2015 | ||
+ 200 bps | 4.5% | (2.7)% | ||
- 200 bps | (14.9)% | (13.4)% |
ITEM 8. | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA |
• | Reports of Independent Registered Public Accounting Firm; |
• | Consolidated Balance Sheets as of December 31, 2016 and 2015; |
• | Consolidated Statements of Income for the Years Ended December 31, 2016, 2015 and 2014; |
• | Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2016, 2015 and 2014 |
• | Consolidated Statements of Changes in Shareholders’ Equity for the Years Ended December 31, 2016, 2015 and 2014; |
• | Consolidated Statements of Cash Flows for the Years Ended December 31, 2016, 2015 and 2014; and |
• | Notes to Consolidated Financial Statements. |
ITEM 9. | CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE |
ITEM 9A. | CONTROLS AND PROCEDURES |
ITEM 9B. | OTHER INFORMATION |
ITEM 10. | DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE |
ITEM 11. | EXECUTIVE COMPENSATION |
ITEM 12. | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS |
ITEM 13. | CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE |
ITEM 14. | PRINCIPAL ACCOUNTING FEES AND SERVICES |
ITEM 15. | EXHIBITS, FINANCIAL STATEMENT SCHEDULES |
(a) | (1) and (2). The response to this portion of Item 15 is submitted as a separate section of this report. |
(3). | Exhibits: |
2.1 | Agreement and Plan of Reorganization, dated as of October 21, 2016, between Access National Corporation and Middleburg Financial Corporation, attached as Exhibit 2.1 to the current report and Form 8-K, filed October 25, 2016, incorporated herein by reference. |
3.1 | Amended and Restated Articles of Incorporation of the Company, attached as Exhibit 3.1 to the Company’s Annual Report on Form 10-K for the period ended December 31, 2008, incorporated herein by reference. |
3.2 | Articles of Amendment to the Articles of Incorporation of the Company, attached as Exhibit 3.1 to the Company’s Current Report on Form 8-K, filed with the Commission on February 4, 2009, incorporated herein by reference. |
3.3 | Bylaws of the Company (restated in electronic format as of July 27, 2016), attached as Exhibit 3.1 to the Company's current report on Form 8-K filed July 28, 2016, incorporated herein by reference. |
4.1 | Warrant to Purchase Shares of Common Stock, dated January 30, 2009, attached as Exhibit 4.1 to the Company’s Annual Report on Form 10-K for the period ended December 31, 2009, incorporated herein by reference. |
10.1 | Agreement, dated as of July 18, 2011, between the Company and Joseph L. Boling, attached as Exhibit 10.1 to the Company’s current Form 8-K filed with the Commission on July 20, 2011, incorporated herein by reference.* |
10.2 | Middleburg Financial Corporation 2006 Equity Compensation Plan, as amended, attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on April 26, 2006, incorporated herein by reference.* |
10.3 | Middleburg Financial Corporation Form of Performance Share Award Agreement, attached as Exhibit 10.3 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2008, incorporated herein by reference.* |
10.4 | Middleburg Financial Corporation Form of Restricted Share Award Agreement, attached as Exhibit 10.4 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2008, incorporated herein by reference.* |
10.5 | Middleburg Financial Corporation Form of Non-Qualified Stock Option Agreement, attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on March 20, 2009, incorporated herein by reference.* |
10.6 | Middleburg Financial Corporation 2006 Management Incentive Plan, attached as Exhibit 10.3 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2005, incorporated herein by reference .* |
10.7 | Employment Agreement, dated as of April 28, 2010, between the Company and Gary R. Shook, attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on April 28, 2010, incorporated herein by reference.* |
10.8 | Employment Agreement, dated as of May 7, 2010, between the Company and Raj Mehra, attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on May 13, 2010, incorporated herein by reference.* |
10.9 | Executive Retirement Plan, as amended and restated through April 28,, 2010, attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K/A, Filed with the commission on October 14, 2010, incorporated herein by reference* |
10.1 | Supplemental Benefit Plan, as amended and restated effective November 17, 2010, attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on November 22, 2010, incorporated herein by reference.* |
10.11 | Stock Purchase Agreement, dated March 27, 2009, between the Company and David L. Sokol, attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on March 31, 2009, incorporated herein by reference.* |
10.12 10.13 | First Amendment to Stock Purchase Agreement, dated October 27, 2010, between the Company and David L. Sokol, attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on October 28, 2010, incorporated herein by reference. Second Amendment to Stock Purchase Agreement, dated April 28, 2014, between the Company and David L. Sokol, attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on April 30, 2014, incorporated herein by reference. |
10.14 | Employment Agreement, dated as of April 28, 2010, between the Company and Jeffrey H. Culver, attached as Exhibit 10.14 to the Company's Annual Report on Form 10-K for the year ended December 31, 2010, incorporated herein by reference.* |
21.1 | Subsidiaries of the Company. |
23.1 | Consent of Yount, Hyde & Barbour, P.C. |
24.1 | Power of Attorney |
31.1 | Rule 13a-14(a) Certification of Chief Executive Officer |
31.2 | Rule 13a-14(a) Certification of Chief Financial Officer. |
32.1 | Statement of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. § 1350. |
101 | The following materials from the Middleburg Financial Corporation Annual Report on Form 10-K for the year ended December 31, 2016 formatted in Extensible Business reporting Language (XBRL): (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Income, (iii) Consolidated Statements of Comprehensive Income, (iv) Consolidated Statements of Changes in Shareholders’ Equity, (v) Consolidated Statements of Cash Flows, and (vi) Notes to Consolidated Financial Statements. |
(b) | Exhibits |
(c) | Financial Statement Schedules |
MIDDLEBURG FINANCIAL CORPORATION | |||
Date: | March 15, 2017 | By: | /s/ Gary R. Shook |
Gary R. Shook | |||
Chief Executive Officer | |||
Date: | March 15, 2017 | By: | /s/ Raj Mehra |
Raj Mehra | |||
Chief Financial Officer | |||
Date: | March 15, 2017 | By: | /s/ Tammy P. Frazier |
Tammy P. Frazier | |||
Chief Accounting Officer |
Signature | Title | Date |
/s/ John C. Lee, IV* | Chairman of the Board and Director | March 15, 2017 |
John C. Lee, IV | ||
/s/ Gary R. Shook | Chief Executive Officer and President | March 15, 2017 |
Gary R. Shook | (Principal Executive Officer) | |
/s/ Raj Mehra | Executive Vice President and Chief Financial Officer | March 15, 2017 |
Raj Mehra | (Principal Financial Officer) | |
/s/ Tammy P. Frazier | Senior Vice President and Chief Accounting Officer | March 15, 2017 |
Tammy P. Frazier | (Principal Accounting Officer) | |
/s/ Howard M. Armfield* | Director | March 15, 2017 |
Howard M. Armfield | ||
/s/ Henry F. Atherton, III* | Director | March 15, 2017 |
Henry F. Atherton, III | ||
/s/ Childs F. Burden* | Director | March 15, 2017 |
Childs F. Burden | ||
/s/ John Rust* | Director | March 15, 2017 |
John Rust | ||
/s/ Alexander G. Green, III* | Director | March 15, 2017 |
Alexander G. Green, III |
/s/ Gary D. LeClair* | Director | March 15, 2017 |
Gary D. LeClair | ||
/s/ Keith W. Meurlin* | Director | March 15, 2017 |
Keith W. Meurlin | ||
/s/ Janet A. Neuharth* | Director | March 15, 2017 |
Janet A. Neuharth | ||
/s/ Mary Leigh McDaniel* | Director | March 15, 2017 |
Mary Leigh McDaniel |
Exhibit No. | Description |
2.1 | Agreement and Plan of Reorganization, dated as of October 21, 2016, between Access National Corporation and Middleburg Financial Corporation, attached as Exhibit 2.1 to the current report and Form 8-K, filed October 25, 2016, incorporated herein by reference. |
3.1 | Amended and Restated Articles of Incorporation of the Company, attached as Exhibit 3.1 to the Company’s Annual Report on Form 10-K for the period ended December 31, 2008, incorporated herein by reference. |
3.2 | Articles of Amendment to the Articles of Incorporation of the Company, attached as Exhibit 3.1 to the Company’s Current Report on Form 8-K, filed with the Commission on February 4, 2009, incorporated herein by reference. |
3.3 | Bylaws of the Company (restated in electronic format as of July 27, 2016), attached as Exhibit 3.1 to the Company's current report on Form 8-K filed July 28, 2016, incorporated herein by reference. |
4.1 | Warrant to Purchase Shares of Common Stock, dated January 30, 2009, attached as Exhibit 4.1 to the Company’s Annual Report on Form 10-K for the period ended December 31, 2009, incorporated herein by reference. |
10.1 | Agreement, dated as of July 18, 2011, between the Company and Joseph L. Boling, attached as Exhibit 10.1 to the Company’s current Form 8-K filed with the Commission on July 20, 2011, incorporated herein by reference.* |
10.2 | Middleburg Financial Corporation 2006 Equity Compensation Plan, as amended, attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on April 26, 2006, incorporated herein by reference.* |
10.3 | Middleburg Financial Corporation Form of Performance Share Award Agreement, attached as Exhibit 10.3 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2008, incorporated herein by reference.* |
10.4 | Middleburg Financial Corporation Form of Restricted Share Award Agreement, attached as Exhibit 10.4 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2008, incorporated herein by reference.* |
10.5 | Middleburg Financial Corporation Form of Non-Qualified Stock Option Agreement, attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on March 20, 2009, incorporated herein by reference.* |
10.6 | Middleburg Financial Corporation 2006 Management Incentive Plan, attached as Exhibit 10.3 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2005, incorporated herein by reference .* |
10.7 | Employment Agreement, dated as of April 28, 2010, between the Company and Gary R. Shook, attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on April 28, 2010, incorporated herein by reference.* |
10.8 | Employment Agreement, dated as of May 7, 2010, between the Company and Raj Mehra, attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on May 13, 2010, incorporated herein by reference.* |
10.9 | Executive Retirement Plan, as amended and restated through April 28,, 2010, attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K/A, Filed with the commission on October 14, 2010, incorporated herein by reference* |
10.10 | Supplemental Benefit Plan, as amended and restated effective November 17, 2010, attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on November 22, 2010, incorporated herein by reference.* |
10.11 | Stock Purchase Agreement, dated March 27, 2009, between the Company and David L. Sokol, attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on March 31, 2009, incorporated herein by reference.* |
10.12 10.13 | First Amendment to Stock Purchase Agreement, dated October 27, 2010, between the Company and David L. Sokol, attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on October 28, 2010, incorporated herein by reference. Second Amendment to Stock Purchase Agreement, dated April 28, 2014, between the Company and David L. Sokol, attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on April 30, 2014, incorporated herein by reference. |
10.14 | Employment Agreement, dated as of April 28, 2010, between the Company and Jeffrey H. Culver, attached as Exhibit 10.14 to the Company's Annual Report on Form 10-K for the year ended December 31, 2010, incorporated herein by reference.* |
21.1 | Subsidiaries of the Company. |
23.1 | Consent of Yount, Hyde & Barbour, P.C. |
24.1 | Power of Attorney |
31.1 | Rule 13a-14(a) Certification of Chief Executive Officer |
31.2 | Rule 13a-14(a) Certification of Chief Financial Officer. |
32.1 | Statement of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. § 1350. |
101 | The following materials from the Middleburg Financial Corporation Annual Report on Form 10-K for the year ended December 31, 2016 formatted in Extensible Business reporting Language (XBRL): (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Income, (iii) Consolidated Statements of Comprehensive Income, (iv) Consolidated Statements of Changes in Shareholders’ Equity, (v) Consolidated Statements of Cash Flows, and (vi) Notes to Consolidated Financial Statements. |
Page | |
MIDDLEBURG FINANCIAL CORPORATION AND SUBSIDIARIES | |||||||
CONSOLIDATED BALANCE SHEETS | |||||||
(Dollars in thousands, except for share and per share data) | |||||||
December 31, | |||||||
2016 | 2015 | ||||||
ASSETS | |||||||
Cash and due from banks | $ | 6,989 | $ | 5,489 | |||
Interest bearing deposits with other banks | 21,555 | 33,739 | |||||
Total cash and cash equivalents | 28,544 | 39,228 | |||||
Securities held to maturity, fair value of $10,095 and $4,163, respectively | 10,683 | 4,207 | |||||
Securities available for sale, at fair value | 301,567 | 374,571 | |||||
Restricted securities, at cost | 4,542 | 6,411 | |||||
Loans, net of allowance for loan losses of $11,404 and $11,046, respectively | 848,693 | 794,635 | |||||
Premises and equipment, net | 19,021 | 19,531 | |||||
Goodwill and identified intangibles, net | 3,465 | 3,636 | |||||
Other real estate owned, net of valuation allowance | 5,073 | 3,345 | |||||
Bank owned life insurance | 23,925 | 23,273 | |||||
Accrued interest receivable and other assets | 27,130 | 26,026 | |||||
TOTAL ASSETS | $ | 1,272,643 | $ | 1,294,863 | |||
LIABILITIES | |||||||
Deposits: | |||||||
Non-interest bearing demand deposits | $ | 248,567 | $ | 235,897 | |||
Savings and interest bearing demand deposits | 578,851 | 560,328 | |||||
Time deposits | 225,640 | 244,575 | |||||
Total deposits | 1,053,058 | 1,040,800 | |||||
Securities sold under agreements to repurchase | 34,864 | 26,869 | |||||
Federal Home Loan Bank borrowings | 39,500 | 85,000 | |||||
Subordinated notes | 5,155 | 5,155 | |||||
Accrued interest payable and other liabilities | 13,387 | 13,485 | |||||
TOTAL LIABILITIES | 1,145,964 | 1,171,309 | |||||
Commitments and contingencies | |||||||
SHAREHOLDERS' EQUITY | |||||||
Common stock ($2.50 par value; 20,000,000 shares authorized; 7,205,066 and 7,085,217 issued and outstanding, respectively) | 17,636 | 17,330 | |||||
Capital surplus | 45,688 | 44,155 | |||||
Retained earnings | 64,755 | 60,392 | |||||
Accumulated other comprehensive income (loss), net | (1,400 | ) | 1,677 | ||||
TOTAL SHAREHOLDERS' EQUITY | 126,679 | 123,554 | |||||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | 1,272,643 | $ | 1,294,863 |
MIDDLEBURG FINANCIAL CORPORATION AND SUBSIDIARIES | |||||||||||
CONSOLIDATED STATEMENTS OF INCOME | |||||||||||
(Dollars in thousands, except for per share data) | |||||||||||
Years Ended December 31, | |||||||||||
2016 | 2015 | 2014 | |||||||||
INTEREST INCOME | |||||||||||
Interest and fees on loans | $ | 33,795 | $ | 32,479 | $ | 33,833 | |||||
Interest and dividends on securities | |||||||||||
Taxable | 7,406 | 7,628 | 6,900 | ||||||||
Tax-exempt | 1,700 | 1,803 | 2,137 | ||||||||
Dividends | 310 | 265 | 293 | ||||||||
Interest on deposits with other banks and federal funds sold | 164 | 106 | 162 | ||||||||
Total interest and dividend income | 43,375 | 42,281 | 43,325 | ||||||||
INTEREST EXPENSE | |||||||||||
Interest on deposits | 3,535 | 3,462 | 3,889 | ||||||||
Interest on securities sold under agreements to repurchase | 3 | 64 | 318 | ||||||||
Interest on FHLB borrowings and other debt | 886 | 681 | 1,036 | ||||||||
Total interest expense | 4,424 | 4,207 | 5,243 | ||||||||
NET INTEREST INCOME | 38,951 | 38,074 | 38,082 | ||||||||
Provision for loan losses | 1,853 | 2,293 | 1,960 | ||||||||
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES | 37,098 | 35,781 | 36,122 | ||||||||
NON-INTEREST INCOME | |||||||||||
Service charges on deposit accounts | 1,154 | 1,061 | 1,163 | ||||||||
Trust services income | 4,643 | 4,785 | 4,362 | ||||||||
ATM fee income, net | 762 | 797 | 739 | ||||||||
Gains (losses) on sales of loans held for sale, net | 32 | (1 | ) | 4,860 | |||||||
Gains on sales of securities available for sale, net | 1,554 | 140 | 186 | ||||||||
Commissions on investment sales | 555 | 547 | 611 | ||||||||
Bank owned life insurance | 652 | 656 | 662 | ||||||||
Gain on sale of majority interest in consolidated subsidiary | — | — | 24 | ||||||||
Other operating income | 1,386 | 1,636 | 1,659 | ||||||||
Total non-interest income | 10,738 | 9,621 | 14,266 | ||||||||
NON-INTEREST EXPENSE | |||||||||||
Salaries and employee benefits | 18,757 | 18,435 | 22,601 | ||||||||
Occupancy and equipment | 4,881 | 5,106 | 6,177 | ||||||||
Advertising | 200 | 288 | 365 | ||||||||
Amortization | 1,211 | 1,001 | 791 | ||||||||
Computer operations | 2,582 | 2,337 | 1,893 | ||||||||
Other real estate owned, net | 363 | 284 | 256 | ||||||||
Other taxes | 947 | 915 | 849 | ||||||||
Federal deposit insurance | 748 | 786 | 899 | ||||||||
Audits and exams | 589 | 585 | 630 | ||||||||
Legal and advisory fees | 1,202 | 1,029 | 1,324 | ||||||||
Merger related expenses | 1,289 | — | — | ||||||||
Other operating expenses | 4,190 | 4,091 | 4,776 | ||||||||
Total non-interest expense | 36,959 | 34,857 | 40,561 | ||||||||
Income before income taxes | 10,877 | 10,545 | 9,827 | ||||||||
Income tax expense | 2,813 | 2,715 | 2,341 | ||||||||
NET INCOME | 8,064 | 7,830 | 7,486 | ||||||||
Net loss attributable to non-controlling interest | — | — | 98 | ||||||||
Net income attributable to Middleburg Financial Corporation | $ | 8,064 | $ | 7,830 | $ | 7,584 | |||||
Earnings per share: | |||||||||||
Basic | $ | 1.13 | $ | 1.10 | $ | 1.07 | |||||
Diluted | $ | 1.13 | $ | 1.09 | $ | 1.06 |
MIDDLEBURG FINANCIAL CORPORATION AND SUBSIDIARIES | |||||||||||
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||||||||||
(Dollars in thousands) | |||||||||||
Years Ended December 31, | |||||||||||
2016 | 2015 | 2014 | |||||||||
Net income | $ | 8,064 | $ | 7,830 | $ | 7,486 | |||||
Other comprehensive income (loss), net of tax: | |||||||||||
Unrealized holding gains (losses) arising during the period, net of tax of $1,091, $1,037, and ($1,979), respectively | (2,116 | ) | (2,015 | ) | 3,841 | ||||||
Reclassification adjustment for gains included in net income, net of tax of $528, $48, and $63, respectively | (1,026 | ) | (92 | ) | (123 | ) | |||||
Unrealized gains (losses) on interest rate swaps, net of tax of ($34), $3, and $82, respectively | 65 | (6 | ) | (160 | ) | ||||||
Reclassification adjustment for (gain) loss on interest rate swap ineffectiveness included in net income, net of tax of $0, $2 and ($2), respectively | — | (4 | ) | 4 | |||||||
Total other comprehensive income (loss) | (3,077 | ) | (2,117 | ) | 3,562 | ||||||
Total comprehensive income | 4,987 | 5,713 | 11,048 | ||||||||
Comprehensive loss attributable to non-controlling interest | — | — | 98 | ||||||||
Comprehensive income attributable to Middleburg Financial Corporation | $ | 4,987 | $ | 5,713 | $ | 11,146 | |||||
MIDDLEBURG FINANCIAL CORPORATION AND SUBSIDIARIES | |||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY | |||||||||||||||||||||||
(Dollars in thousands, except for share and per share data) | |||||||||||||||||||||||
Common Stock | Capital Surplus | Retained Earnings | Accumulated Other Comprehensive Income (Loss), Net | Non-Controlling Interest | Total | ||||||||||||||||||
Balance December 31, 2013 | $ | 17,403 | $ | 44,251 | $ | 50,689 | $ | 232 | $ | 2,498 | $ | 115,073 | |||||||||||
Net income | — | — | 7,584 | — | (98 | ) | 7,486 | ||||||||||||||||
Other comprehensive income, net of tax | — | — | — | 3,562 | — | 3,562 | |||||||||||||||||
Cash dividends – ($0.34 per share) | — | — | (2,419 | ) | — | — | (2,419 | ) | |||||||||||||||
Sale of majority interest in consolidated subsidiary | — | — | — | — | (2,400 | ) | (2,400 | ) | |||||||||||||||
Restricted stock vesting (15,425 shares) | 39 | (39 | ) | — | — | — | — | ||||||||||||||||
Repurchase of restricted stock (4,732 shares) | (12 | ) | (113 | ) | — | — | — | (125 | ) | ||||||||||||||
Exercise of stock options (25,501 shares) | 64 | 330 | — | — | — | 394 | |||||||||||||||||
Share-based compensation | — | 463 | — | — | — | 463 | |||||||||||||||||
Balance December 31, 2014 | $ | 17,494 | $ | 44,892 | $ | 55,854 | $ | 3,794 | $ | — | $ | 122,034 | |||||||||||
Net income | — | — | 7,830 | — | — | 7,830 | |||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | (2,117 | ) | — | (2,117 | ) | |||||||||||||||
Cash dividends – ($0.46 per share) | — | — | (3,292 | ) | — | — | (3,292 | ) | |||||||||||||||
Restricted stock vesting (16,359 shares) | 41 | (41 | ) | — | — | — | — | ||||||||||||||||
Repurchase of restricted stock (4,576 shares) | (11 | ) | (72 | ) | — | — | — | (83 | ) | ||||||||||||||
Share-based compensation | — | 605 | — | — | — | 605 | |||||||||||||||||
Repurchase of common stock (77,500 shares) | (194 | ) | (1,229 | ) | — | — | — | (1,423 | ) | ||||||||||||||
Balance December 31, 2015 | $ | 17,330 | $ | 44,155 | $ | 60,392 | $ | 1,677 | $ | — | $ | 123,554 | |||||||||||
Net income | — | — | 8,064 | — | — | 8,064 | |||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | (3,077 | ) | — | (3,077 | ) | |||||||||||||||
Cash dividends – ($0.52 per share) | — | — | (3,701 | ) | — | — | (3,701 | ) | |||||||||||||||
Restricted stock vesting (53,908 shares) | 135 | (135 | ) | — | — | — | — | ||||||||||||||||
Repurchase of restricted stock (15,351 shares) | (38 | ) | (315 | ) | — | — | — | (353 | ) | ||||||||||||||
Share-based compensation | — | 939 | — | — | — | 939 | |||||||||||||||||
Exercise of stock options (6,650 shares) | 16 | 76 | — | — | — | 92 | |||||||||||||||||
Exercise of stock warrant (104,101 shares) | 260 | 1,390 | — | — | — | 1,650 | |||||||||||||||||
Repurchase of common stock (26,800 shares) | (67 | ) | (422 | ) | — | — | — | (489 | ) | ||||||||||||||
Balance December 31, 2016 | $ | 17,636 | $ | 45,688 | $ | 64,755 | $ | (1,400 | ) | $ | — | $ | 126,679 |
Years Ended December 31, | |||||||||||
(Dollars in thousands) | 2016 | 2015 | 2014 | ||||||||
Cash Flows From Operating Activities | |||||||||||
Net income | $ | 8,064 | $ | 7,830 | $ | 7,486 | |||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
Depreciation and amortization | 2,584 | 2,352 | 2,339 | ||||||||
Provision for loan losses | 1,853 | 2,293 | 1,960 | ||||||||
Gains on sales of securities available for sale, net | (1,554 | ) | (140 | ) | (186 | ) | |||||
Loss on disposal of assets, net | 115 | 67 | 59 | ||||||||
Originations of mortgage loans held for sale | (3,346 | ) | (1,597 | ) | — | ||||||
Proceeds from sales of mortgage loans held for sale | 3,378 | 1,596 | 38,035 | ||||||||
(Gains) losses on sales of mortgage loans held for sale, net | (32 | ) | 1 | (4,860 | ) | ||||||
Premium amortization on securities, net | 4,956 | 4,042 | 2,981 | ||||||||
Deferred income tax expense | 746 | 109 | 1,181 | ||||||||
Gain on sale of majority interest in consolidated subsidiary | — | — | (24 | ) | |||||||
Share-based compensation | 925 | 605 | 426 | ||||||||
(Gains) losses on sales of other real estate owned, net | (66 | ) | 100 | 14 | |||||||
Valuation adjustments on other real estate owned | 310 | 79 | (3 | ) | |||||||
Valuation adjustments on other assets held for sale | 200 | — | 200 | ||||||||
Increase in bank owned life insurance cash surrender value | (652 | ) | (656 | ) | (662 | ) | |||||
Changes in assets and liabilities: | |||||||||||
Increase in other assets | (1,406 | ) | (4,826 | ) | (2,604 | ) | |||||
Increase (decrease) in other liabilities | (98 | ) | 448 | 2,447 | |||||||
Net cash provided by operating activities | $ | 15,977 | $ | 12,303 | $ | 48,789 | |||||
Cash Flows from Investing Activities | |||||||||||
Proceeds from maturity, calls, principal repayments and sales of securities available for sale | 155,485 | 106,154 | 132,286 | ||||||||
Proceeds from maturity, calls, and principal repayments of held to maturity | 44 | 43 | — | ||||||||
Purchases of securities held to maturity | (6,520 | ) | (2,750 | ) | (1,500 | ) | |||||
Purchases of securities available for sale | (90,644 | ) | (139,556 | ) | (149,287 | ) | |||||
(Purchases) redemptions of restricted stock, net | 1,869 | (1,132 | ) | 1,501 | |||||||
(Purchases) sales of bank premises and equipment, net | (978 | ) | (2,137 | ) | 321 | ||||||
Loan originations, net | (26,687 | ) | (13,941 | ) | (5,748 | ) | |||||
Proceeds from sales of loans | 4,412 | 1,124 | 5,492 | ||||||||
Purchases of loans | (36,321 | ) | (42,035 | ) | (34,042 | ) | |||||
Proceeds from sale of majority interest in consolidated subsidiary, net | — | — | 3,618 | ||||||||
Proceeds from sale of other real estate owned and repossessed assets | 713 | 893 | 2,666 | ||||||||
Net cash provided by (used in) investing activities | $ | 1,373 | $ | (93,337 | ) | $ | (44,693 | ) | |||
Cash Flows from Financing Activities | |||||||||||
Increase in demand, interest-bearing demand and savings deposits | $ | 31,193 | $ | 56,083 | $ | 25,686 | |||||
Decrease in certificates of deposit | (18,935 | ) | (4,363 | ) | (19,002 | ) | |||||
Increase (decrease) in securities sold under agreements to repurchase | 7,995 | (11,682 | ) | 4,012 | |||||||
Increase (decrease) in FHLB borrowings | (45,500 | ) | 30,000 | (25,000 | ) | ||||||
Payment of dividends on common stock | (3,701 | ) | (3,292 | ) | (2,419 | ) | |||||
Proceeds from exercise of options and warrant | 1,742 | — | 394 | ||||||||
Excess tax benefit on share-based compensation | 14 | — | 37 | ||||||||
Repurchases of common stock | (842 | ) | (1,506 | ) | (125 | ) | |||||
Net cash provided by (used in) provided by financing activities | $ | (28,034 | ) | $ | 65,240 | $ | (16,417 | ) | |||
Decrease in cash and cash equivalents | (10,684 | ) | (15,794 | ) | (12,321 | ) | |||||
Cash and cash equivalents at beginning of year | 39,228 | 55,022 | 67,343 | ||||||||
Cash and cash equivalents at end of year | $ | 28,544 | $ | 39,228 | $ | 55,022 | |||||
Supplemental Disclosures of Cash Flow Information | |||||||||||
Interest paid | $ | 4,447 | $ | 4,200 | $ | 5,341 | |||||
Income taxes | $ | 1,525 | $ | 3,710 | $ | 800 | |||||
Supplemental Disclosure of Non-Cash Transactions | |||||||||||
Unrealized gains (losses) on securities available for sale | $ | (4,761 | ) | $ | (3,192 | ) | $ | 5,634 | |||
Change in market value of interest rate swaps | $ | 99 | $ | (15 | ) | $ | (236 | ) | |||
Transfer of loans to other real estate owned and repossessed assets | $ | 2,645 | $ | 984 | $ | 4,438 | |||||
Transfer of other real estate owned to premises and equipment | $ | — | $ | 697 | $ | — |
Note 1. | Nature of Banking Activities and Significant Accounting Policies |
Years | |
Buildings and improvements | 10-40 |
Furniture and equipment | 3-15 |
Note 2. | Securities |
December 31, 2016 | |||||||||||||||
(Dollars in thousands) | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||
Held to Maturity | |||||||||||||||
Obligations of states and political subdivisions | $ | 6,433 | $ | — | $ | (594 | ) | $ | 5,839 | ||||||
Corporate securities | 4,250 | 21 | (15 | ) | 4,256 | ||||||||||
Total | $ | 10,683 | $ | 21 | $ | (609 | ) | $ | 10,095 |
December 31, 2015 | |||||||||||||||
(Dollars in thousands) | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||
Held to Maturity | |||||||||||||||
Obligations of states and political subdivisions | $ | 1,457 | $ | — | $ | (38 | ) | $ | 1,419 | ||||||
Corporate securities | 2,750 | 24 | (30 | ) | 2,744 | ||||||||||
Total | $ | 4,207 | $ | 24 | $ | (68 | ) | $ | 4,163 |
December 31, 2016 | |||||||
(Dollars in thousands) | Amortized Cost | Fair Value | |||||
Held to Maturity | |||||||
Due after five years through ten years | $ | 4,250 | $ | 4,256 | |||
Due after ten years | 6,433 | 5,839 | |||||
Total | $ | 10,683 | $ | 10,095 |
December 31, 2016 | |||||||||||||||
(Dollars in thousands) | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||
Available for Sale | |||||||||||||||
U.S. government agencies | $ | 73,546 | $ | 209 | $ | (571 | ) | $ | 73,184 | ||||||
Obligations of states and political subdivisions | 62,896 | 1,019 | (542 | ) | 63,373 | ||||||||||
Mortgage-backed securities: | |||||||||||||||
Agency | 98,549 | 646 | (1,144 | ) | 98,051 | ||||||||||
Non-agency | 9,991 | 16 | (74 | ) | 9,933 | ||||||||||
Other asset backed securities | 41,860 | 361 | (616 | ) | 41,605 | ||||||||||
Corporate securities | 16,648 | — | (1,227 | ) | 15,421 | ||||||||||
Total | $ | 303,490 | $ | 2,251 | $ | (4,174 | ) | $ | 301,567 |
December 31, 2015 | |||||||||||||||
(Dollars in thousands) | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||
Available for Sale | |||||||||||||||
U.S. government agencies | $ | 79,005 | $ | 315 | $ | (380 | ) | $ | 78,940 | ||||||
Obligations of states and political subdivisions | 74,071 | 1,956 | (434 | ) | 75,593 | ||||||||||
Mortgage-backed securities: | |||||||||||||||
Agency | 129,360 | 3,046 | (745 | ) | 131,661 | ||||||||||
Non-agency | 12,782 | 33 | (38 | ) | 12,777 | ||||||||||
Other asset backed securities | 58,958 | 426 | (603 | ) | 58,781 | ||||||||||
Corporate securities | 17,557 | 22 | (760 | ) | 16,819 | ||||||||||
Total | $ | 371,733 | $ | 5,798 | $ | (2,960 | ) | $ | 374,571 |
December 31, 2016 | |||||||
(Dollars in thousands) | Amortized Cost | Fair Value | |||||
Available for Sale | |||||||
Due in one year or less | $ | 777 | $ | 777 | |||
Due after one year through five years | 9,020 | 9,219 | |||||
Due after five years through ten years | 25,004 | 24,174 | |||||
Due after ten years | 118,289 | 117,808 | |||||
Mortgage-backed securities | 108,540 | 107,984 | |||||
Other asset backed securities | 41,860 | 41,605 | |||||
Total | $ | 303,490 | $ | 301,567 |
(Dollars in thousands) | Less than Twelve Months | Twelve Months or Greater | Total | |||||||||||||||||||||
2016 | Fair Value | Gross Unrealized Losses | Fair Value | Gross Unrealized Losses | Fair Value | Gross Unrealized Losses | ||||||||||||||||||
Held to Maturity | ||||||||||||||||||||||||
Obligations of states and political subdivisions | $ | 5,839 | $ | (594 | ) | $ | — | $ | — | $ | 5,839 | $ | (594 | ) | ||||||||||
Corporate securities | 1,485 | (15 | ) | — | — | 1,485 | (15 | ) | ||||||||||||||||
Total | $ | 7,324 | $ | (609 | ) | $ | — | $ | — | $ | 7,324 | $ | (609 | ) | ||||||||||
Available for Sale | ||||||||||||||||||||||||
U.S. government agencies | $ | 46,700 | $ | (495 | ) | $ | 7,174 | $ | (76 | ) | $ | 53,874 | $ | (571 | ) | |||||||||
Obligations of states and political subdivisions | 12,670 | (257 | ) | 6,968 | (285 | ) | 19,638 | (542 | ) | |||||||||||||||
Mortgage-backed securities: | ||||||||||||||||||||||||
Agency | 51,018 | (634 | ) | 13,020 | (510 | ) | 64,038 | (1,144 | ) | |||||||||||||||
Non-agency | 5,379 | (68 | ) | 1,944 | (6 | ) | 7,323 | (74 | ) | |||||||||||||||
Other asset backed securities | 7,007 | (284 | ) | 16,388 | (332 | ) | 23,395 | (616 | ) | |||||||||||||||
Corporate securities | 5,912 | (241 | ) | 9,262 | (986 | ) | 15,174 | (1,227 | ) | |||||||||||||||
Total | $ | 128,686 | $ | (1,979 | ) | $ | 54,756 | $ | (2,195 | ) | $ | 183,442 | $ | (4,174 | ) |
(Dollars in thousands) | Less than Twelve Months | Twelve Months or Greater | Total | |||||||||||||||||||||
2015 | Fair Value | Gross Unrealized Losses | Fair Value | Gross Unrealized Losses | Fair Value | Gross Unrealized Losses | ||||||||||||||||||
Held to Maturity | ||||||||||||||||||||||||
Obligations of states and political subdivisions | $ | 1,419 | $ | (38 | ) | $ | — | $ | — | $ | 1,419 | $ | (38 | ) | ||||||||||
Corporate securities | 1,970 | (30 | ) | — | — | 1,970 | (30 | ) | ||||||||||||||||
Total | $ | 3,389 | $ | (68 | ) | $ | — | $ | — | $ | 3,389 | $ | (68 | ) | ||||||||||
Available for Sale | ||||||||||||||||||||||||
U.S. government agencies | $ | 46,000 | $ | (304 | ) | $ | 4,223 | $ | (76 | ) | $ | 50,223 | $ | (380 | ) | |||||||||
Obligations of states and political subdivisions | 16,559 | (324 | ) | 1,082 | (110 | ) | 17,641 | (434 | ) | |||||||||||||||
Mortgage-backed securities: | ||||||||||||||||||||||||
Agency | 27,627 | (402 | ) | 9,911 | (343 | ) | 37,538 | (745 | ) | |||||||||||||||
Non-agency | 7,842 | (37 | ) | 671 | (1 | ) | 8,513 | (38 | ) | |||||||||||||||
Other asset backed securities | 25,399 | (276 | ) | 12,037 | (327 | ) | 37,436 | (603 | ) | |||||||||||||||
Corporate securities | 10,740 | (378 | ) | 4,866 | (382 | ) | 15,606 | (760 | ) | |||||||||||||||
Total | $ | 134,167 | $ | (1,721 | ) | $ | 32,790 | $ | (1,239 | ) | $ | 166,957 | $ | (2,960 | ) |
Note 3. | Loans, Net |
2016 | 2015 | ||||||||||||
(Dollars in thousands) | Outstanding Balance | Percent of Total Portfolio | Outstanding Balance | Percent of Total Portfolio | |||||||||
Real estate loans: | |||||||||||||
Construction | $ | 35,627 | 4.1 | % | $ | 39,673 | 4.9 | % | |||||
Secured by farmland | 16,768 | 2.0 | 19,062 | 2.4 | |||||||||
Secured by 1-4 family residential | 314,045 | 36.5 | 280,096 | 34.8 | |||||||||
Other real estate loans | 283,613 | 33.0 | 258,035 | 32.0 | |||||||||
Commercial loans | 190,767 | 22.2 | 190,482 | 23.6 | |||||||||
Consumer loans | 19,277 | 2.2 | 18,333 | 2.3 | |||||||||
Total Gross Loans (1) | 860,097 | 100.0 | % | 805,681 | 100.0 | % | |||||||
Less allowance for loan losses | 11,404 | 11,046 | |||||||||||
Net loans | $ | 848,693 | $ | 794,635 |
(1) | Includes net deferred loan costs and premiums of $3.3 million and $3.5 million, respectively. |
December 31, 2016 | |||||||||||||||||||||||
(Dollars in thousands) | 30-59 Days Past Due | 60-89 Days Past Due | 90 Days Or Greater | Total Past Due | Current | Total Loans | |||||||||||||||||
Real estate loans: | |||||||||||||||||||||||
Construction | $ | — | $ | — | $ | — | $ | — | $ | 35,627 | $ | 35,627 | |||||||||||
Secured by farmland | — | 199 | — | 199 | 16,569 | 16,768 | |||||||||||||||||
Secured by 1-4 family residential | — | — | 514 | 514 | 313,531 | 314,045 | |||||||||||||||||
Other real estate loans | 312 | — | 2,104 | 2,416 | 281,197 | 283,613 | |||||||||||||||||
Commercial loans | 146 | 10 | 2,518 | 2,674 | 188,093 | 190,767 | |||||||||||||||||
Consumer loans | 88 | 4 | 1,871 | 1,963 | 17,314 | 19,277 | |||||||||||||||||
Total | $ | 546 | $ | 213 | $ | 7,007 | $ | 7,766 | $ | 852,331 | $ | 860,097 |
December 31, 2015 | |||||||||||||||||||||||
(Dollars in thousands) | 30-59 Days Past Due | 60-89 Days Past Due | 90 Days Or Greater | Total Past Due | Current | Total Loans | |||||||||||||||||
Real estate loans: | |||||||||||||||||||||||
Construction | $ | 69 | $ | — | $ | — | $ | 69 | $ | 39,604 | $ | 39,673 | |||||||||||
Secured by farmland | — | — | — | — | 19,062 | 19,062 | |||||||||||||||||
Secured by 1-4 family residential | 259 | — | 1,117 | 1,376 | 278,720 | 280,096 | |||||||||||||||||
Other real estate loans | 325 | — | 248 | 573 | 257,462 | 258,035 | |||||||||||||||||
Commercial loans | 1,242 | 15 | 31 | 1,288 | 189,194 | 190,482 | |||||||||||||||||
Consumer loans | 4 | 17 | — | 21 | 18,312 | 18,333 | |||||||||||||||||
Total | $ | 1,899 | $ | 32 | $ | 1,396 | $ | 3,327 | $ | 802,354 | $ | 805,681 |
2016 | 2015 | ||||||||||||||
(Dollars in thousands) | Nonaccrual | Past due 90 days or more and still accruing | Nonaccrual | Past due 90 days or more and still accruing | |||||||||||
Real estate loans: | |||||||||||||||
Construction | $ | 29 | $ | — | $ | 204 | $ | — | |||||||
Secured by 1-4 family residential | 296 | 303 | 4,460 | — | |||||||||||
Other real estate loans | 1,976 | 128 | 1,186 | 248 | |||||||||||
Commercial loans | 4,187 | 350 | 1,036 | 30 | |||||||||||
Consumer loans | 1,871 | — | 1,898 | — | |||||||||||
Total | $ | 8,359 | $ | 781 | $ | 8,784 | $ | 278 |
December 31, 2016 | |||||||||||||||||||||||||||
(Dollars in thousands) | Real Estate Construction | Real Estate Secured by Farmland | Real Estate Secured by 1-4 Family Residential | Other Real Estate Loans | Commercial | Consumer | Total | ||||||||||||||||||||
Pass | $ | 30,065 | $ | 8,796 | $ | 310,233 | $ | 274,591 | $ | 185,030 | $ | 17,342 | $ | 826,057 | |||||||||||||
Special Mention | 5,534 | — | 932 | 2,287 | 1,390 | 25 | 10,168 | ||||||||||||||||||||
Substandard | 28 | 7,972 | 2,584 | 4,759 | 2,179 | 1,909 | 19,431 | ||||||||||||||||||||
Doubtful | — | — | 125 | 1,976 | 2,168 | — | 4,269 | ||||||||||||||||||||
Loss | — | — | 171 | — | — | 1 | 172 | ||||||||||||||||||||
Ending Balance | $ | 35,627 | $ | 16,768 | $ | 314,045 | $ | 283,613 | $ | 190,767 | $ | 19,277 | $ | 860,097 |
December 31, 2015 | |||||||||||||||||||||||||||
(Dollars in thousands) | Real Estate Construction | Real Estate Secured by Farmland | Real Estate Secured by 1-4 Family Residential | Other Real Estate Loans | Commercial | Consumer | Total | ||||||||||||||||||||
Pass | $ | 30,114 | $ | 10,566 | $ | 271,721 | $ | 243,768 | $ | 183,532 | $ | 16,347 | $ | 756,048 | |||||||||||||
Special Mention | 9,024 | — | 896 | 7,254 | 3,638 | 42 | 20,854 | ||||||||||||||||||||
Substandard | 535 | 8,496 | 6,818 | 5,827 | 2,301 | 1,943 | 25,920 | ||||||||||||||||||||
Doubtful | — | — | 661 | 1,186 | 1,011 | — | 2,858 | ||||||||||||||||||||
Loss | — | — | — | — | — | 1 | 1 | ||||||||||||||||||||
Ending Balance | $ | 39,673 | $ | 19,062 | $ | 280,096 | $ | 258,035 | $ | 190,482 | $ | 18,333 | $ | 805,681 |
December 31, 2016 | |||||||||||||||||||
(Dollars in thousands) | Recorded Investment | Unpaid Principal Balance | Related Allowance | Average Recorded Investment | Interest Income Recognized | ||||||||||||||
With no related allowance recorded: | |||||||||||||||||||
Real estate loans: | |||||||||||||||||||
Construction | $ | 28 | $ | 28 | $ | — | $ | 28 | $ | — | |||||||||
Secured by farmland | 7,972 | 7,972 | — | 7,951 | 239 | ||||||||||||||
Secured by 1-4 family residential | 72 | 108 | — | 72 | 2 | ||||||||||||||
Other real estate loans | 1,976 | 1,976 | — | 1,976 | — | ||||||||||||||
Commercial loans | 585 | 3,585 | — | 706 | 16 | ||||||||||||||
Consumer loans | — | — | — | — | — | ||||||||||||||
Total with no related allowance | $ | 10,633 | $ | 13,669 | $ | — | $ | 10,733 | $ | 257 | |||||||||
With an allowance recorded: | |||||||||||||||||||
Real estate loans: | |||||||||||||||||||
Construction | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||
Secured by farmland | — | — | — | — | — | ||||||||||||||
Secured by 1-4 family residential | 1,275 | 1,326 | 251 | 1,239 | 49 | ||||||||||||||
Other real estate loans | 2,971 | 2,971 | 206 | 2,975 | 151 | ||||||||||||||
Commercial loans | 4,019 | 4,019 | 2,539 | 5,088 | — | ||||||||||||||
Consumer loans | 1,871 | 1,871 | 842 | 1,871 | — | ||||||||||||||
Total with a related allowance | $ | 10,136 | $ | 10,187 | $ | 3,838 | $ | 11,173 | $ | 200 | |||||||||
Total | $ | 20,769 | $ | 23,856 | $ | 3,838 | $ | 21,906 | $ | 457 |
December 31, 2015 | |||||||||||||||||||
(Dollars in thousands) | Recorded Investment | Unpaid Principal Balance | Related Allowance | Average Recorded Investment | Interest Income Recognized | ||||||||||||||
With no related allowance recorded: | |||||||||||||||||||
Real estate loans: | |||||||||||||||||||
Construction | $ | 100 | $ | 100 | $ | — | $ | 106 | $ | — | |||||||||
Secured by farmland | 7,903 | 7,903 | — | 7,903 | 237 | ||||||||||||||
Secured by 1-4 family residential | 701 | 736 | — | 703 | — | ||||||||||||||
Other real estate loans | — | — | — | — | — | ||||||||||||||
Commercial loans | 458 | 493 | — | 490 | 17 | ||||||||||||||
Consumer loans | — | — | — | — | — | ||||||||||||||
Total with no related allowance | $ | 9,162 | $ | 9,232 | $ | — | $ | 9,202 | $ | 254 | |||||||||
With an allowance recorded: | |||||||||||||||||||
Real estate loans: | |||||||||||||||||||
Construction | $ | 103 | $ | 103 | $ | 53 | $ | 109 | $ | — | |||||||||
Secured by farmland | — | — | — | — | — | ||||||||||||||
Secured by 1-4 family residential | 4,426 | 4,478 | 1,120 | 4,547 | 27 | ||||||||||||||
Other real estate loans | 4,196 | 4,196 | 464 | 4,224 | 157 | ||||||||||||||
Commercial loans | 1,059 | 4,059 | 27 | 2,315 | 100 | ||||||||||||||
Consumer loans | 1,898 | 1,898 | 1,000 | 2,449 | — | ||||||||||||||
Total with a related allowance | $ | 11,682 | $ | 14,734 | $ | 2,664 | $ | 13,644 | $ | 284 | |||||||||
Total | $ | 20,844 | $ | 23,966 | $ | 2,664 | $ | 22,846 | $ | 538 |
Year Ended December 31, | ||||||||||||||||||||||
(Dollars in thousands) | 2016 | 2015 | ||||||||||||||||||||
Class of Loan | Number of Contracts | Pre-Modification Outstanding Recorded Investment | Post-Modification Outstanding Recorded Investment | Number of Contracts | Pre-Modification Outstanding Recorded Investment | Post-Modification Outstanding Recorded Investment | ||||||||||||||||
Real estate loans: | ||||||||||||||||||||||
Construction | 1 | $ | 38 | $ | 38 | — | $ | — | $ | — | ||||||||||||
Secured by farmland | — | — | — | 1 | 7,903 | 7,903 | ||||||||||||||||
Secured by 1-4 family residential | 2 | 809 | 806 | — | — | — | ||||||||||||||||
Other real estate loans | 2 | 1,240 | 1,240 | 4 | 4,283 | 3,872 | ||||||||||||||||
Total real estate loans | 5 | 2,087 | 2,084 | 5 | 12,186 | 11,775 | ||||||||||||||||
Commercial loans | — | — | — | 1 | 50 | 46 | ||||||||||||||||
Consumer loans | — | — | — | 1 | 3,000 | 3,000 | ||||||||||||||||
Total | 5 | $ | 2,087 | $ | 2,084 | 7 | $ | 15,236 | $ | 14,821 |
Note 4. | Allowance for Loan Losses |
December 31, 2016 | |||||||||||||||||||||||||||
(Dollars in thousands) | Real Estate Construction | Real Estate Secured by Farmland | Real Estate Secured by 1-4 Family Residential | Other Real Estate Loans | Commercial | Consumer | Total | ||||||||||||||||||||
Allowance for loan losses: | |||||||||||||||||||||||||||
Balance December 31, 2015 | $ | 905 | $ | 192 | $ | 3,341 | $ | 3,761 | $ | 1,706 | $ | 1,141 | $ | 11,046 | |||||||||||||
Charge-offs | (388 | ) | — | (1,021 | ) | (126 | ) | (639 | ) | (20 | ) | (2,194 | ) | ||||||||||||||
Recoveries | 129 | — | 395 | 32 | 85 | 58 | 699 | ||||||||||||||||||||
Provision | 293 | (65 | ) | (453 | ) | (500 | ) | 2,781 | (203 | ) | 1,853 | ||||||||||||||||
Balance December 31, 2016 | $ | 939 | $ | 127 | $ | 2,262 | $ | 3,167 | $ | 3,933 | $ | 976 | $ | 11,404 | |||||||||||||
Ending allowance: | |||||||||||||||||||||||||||
Ending allowance balance attributable to loans: | |||||||||||||||||||||||||||
Individually evaluated for impairment | $ | — | $ | — | $ | 251 | $ | 206 | $ | 2,539 | $ | 842 | $ | 3,838 | |||||||||||||
Collectively evaluated for impairment | 939 | 127 | 2,011 | 2,961 | 1,394 | 134 | 7,566 | ||||||||||||||||||||
Total ending allowance balance | $ | 939 | $ | 127 | $ | 2,262 | $ | 3,167 | $ | 3,933 | $ | 976 | $ | 11,404 | |||||||||||||
Loans: | |||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 28 | $ | 7,972 | $ | 1,347 | $ | 4,947 | $ | 4,604 | $ | 1,871 | $ | 20,769 | |||||||||||||
Collectively evaluated for impairment | 35,599 | 8,796 | 312,698 | 278,666 | 186,163 | 17,406 | 839,328 | ||||||||||||||||||||
Total ending loans balance | $ | 35,627 | $ | 16,768 | $ | 314,045 | $ | 283,613 | $ | 190,767 | $ | 19,277 | $ | 860,097 |
December 31, 2015 | |||||||||||||||||||||||||||
(Dollars in thousands) | Real Estate Construction | Real Estate Secured by Farmland | Real Estate Secured by 1-4 Family Residential | Other Real Estate Loans | Commercial | Consumer | Total | ||||||||||||||||||||
Allowance for loan losses: | |||||||||||||||||||||||||||
Balance at December 31, 2014 | $ | 550 | $ | 179 | $ | 3,966 | $ | 3,916 | $ | 2,354 | $ | 821 | $ | 11,786 | |||||||||||||
Charge-offs | — | — | (344 | ) | (9 | ) | (3,281 | ) | (57 | ) | (3,691 | ) | |||||||||||||||
Recoveries | 246 | — | 359 | 28 | 14 | 11 | 658 | ||||||||||||||||||||
Provision | 109 | 13 | (640 | ) | (174 | ) | 2,619 | 366 | 2,293 | ||||||||||||||||||
Balance at December 31, 2015 | $ | 905 | $ | 192 | $ | 3,341 | $ | 3,761 | $ | 1,706 | $ | 1,141 | $ | 11,046 | |||||||||||||
Ending allowance: | |||||||||||||||||||||||||||
Ending allowance balance attributable to loans: | |||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 53 | $ | — | $ | 1,120 | $ | 464 | $ | 27 | $ | 1,000 | $ | 2,664 | |||||||||||||
Collectively evaluated for impairment | 852 | 192 | 2,221 | 3,297 | 1,679 | 141 | 8,382 | ||||||||||||||||||||
Total ending allowance balance | $ | 905 | $ | 192 | $ | 3,341 | $ | 3,761 | $ | 1,706 | $ | 1,141 | $ | 11,046 | |||||||||||||
Loans: | |||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 203 | $ | 7,903 | $ | 5,127 | $ | 4,196 | $ | 1,517 | $ | 1,898 | $ | 20,844 | |||||||||||||
Collectively evaluated for impairment | 39,470 | 11,159 | 274,969 | 253,839 | 188,965 | 16,435 | 784,837 | ||||||||||||||||||||
Total ending loans balance | $ | 39,673 | $ | 19,062 | $ | 280,096 | $ | 258,035 | $ | 190,482 | $ | 18,333 | $ | 805,681 |
December 31, 2014 | |||||||||||||||||||||||||||
(Dollars in thousands) | Real Estate Construction | Real Estate Secured by Farmland | Real Estate Secured by 1-4 Family Residential | Other Real Estate Loans | Commercial | Consumer | Total | ||||||||||||||||||||
Allowance for loan losses: | |||||||||||||||||||||||||||
Balance at December 31, 2013 | $ | 847 | $ | 166 | $ | 6,734 | $ | 3,506 | $ | 1,890 | $ | 177 | $ | 13,320 | |||||||||||||
Adjustment for the sale of majority interest in consolidated subsidiary | — | — | (95 | ) | — | — | — | (95 | ) | ||||||||||||||||||
Charge-offs | (1,186 | ) | — | (1,380 | ) | (747 | ) | (959 | ) | (36 | ) | (4,308 | ) | ||||||||||||||
Recoveries | 258 | — | 342 | 110 | 104 | 95 | 909 | ||||||||||||||||||||
Provision | 631 | 13 | (1,635 | ) | 1,047 | 1,319 | 585 | 1,960 | |||||||||||||||||||
Balance at December 31, 2014 | $ | 550 | $ | 179 | $ | 3,966 | $ | 3,916 | $ | 2,354 | $ | 821 | $ | 11,786 | |||||||||||||
Ending allowance: | |||||||||||||||||||||||||||
Ending allowance balance attributable to loans: | |||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 66 | $ | — | $ | 1,370 | $ | 294 | $ | 292 | $ | 647 | $ | 2,669 | |||||||||||||
Collectively evaluated for impairment | 484 | 179 | 2,596 | 3,622 | 2,062 | 174 | 9,117 | ||||||||||||||||||||
Total ending allowance balance | $ | 550 | $ | 179 | $ | 3,966 | $ | 3,916 | $ | 2,354 | $ | 821 | $ | 11,786 | |||||||||||||
Loans: | |||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 246 | $ | 7,903 | $ | 5,613 | $ | 4,531 | $ | 846 | $ | 3,019 | $ | 22,158 | |||||||||||||
Collectively evaluated for impairment | 32,804 | 11,805 | 259,603 | 250,705 | 162,423 | 15,348 | 732,688 | ||||||||||||||||||||
Total ending loans balance | $ | 33,050 | $ | 19,708 | $ | 265,216 | $ | 255,236 | $ | 163,269 | $ | 18,367 | $ | 754,846 |
Note 5. | Premises and Equipment, Net |
(Dollars in thousands) | 2016 | 2015 | |||||
Land | $ | 2,068 | $ | 2,068 | |||
Facilities | 22,873 | 22,849 | |||||
Furniture, fixtures, and equipment | 11,729 | 11,676 | |||||
Construction in process and deposits on equipment and land | 1,842 | 1,455 | |||||
38,512 | 38,048 | ||||||
Less accumulated depreciation | (19,491 | ) | (18,517 | ) | |||
Total | $ | 19,021 | $ | 19,531 |
(Dollars in thousands) | December 31, 2016 | ||
2017 | $ | 1,666 | |
2018 | 1,617 | ||
2019 | 1,624 | ||
2020 | 1,444 | ||
2021 | 1,408 | ||
Thereafter | 13,388 | ||
$ | 21,147 |
Note 6. | Deposits |
(Dollars in thousands) | December 31, 2016 | ||
2017 | $ | 151,293 | |
2018 | 38,370 | ||
2019 | 25,494 | ||
2020 | 7,115 | ||
2021 | 3,368 | ||
$ | 225,640 |
Note 7. | Borrowings |
(Dollars in thousands) | December 31, 2016 | ||
Due in 2017 | $ | 29,500 | |
Due in 2018 | 10,000 | ||
Total | $ | 39,500 |
(Dollars in thousands) | Securities sold under agreements to repurchase | ||
At December 31: | |||
2016 | $ | 34,864 | |
2015 | 26,869 | ||
Weighted-average interest rate at year-end: | |||
2016 | 0.01 | % | |
2015 | 0.01 | ||
Maximum amount outstanding at any month's end: | |||
2016 | $ | 35,660 | |
2015 | 34,253 | ||
Average amount outstanding during the year: | |||
2016 | $ | 31,076 | |
2015 | 30,095 | ||
Weighted-average interest rate during the year: | |||
2016 | 0.01 | % | |
2015 | 0.21 |
Note 8. | Share-Based Compensation Plan |
December 31, | ||||||||||||||||||||||||||||||||
2016 | 2015 | 2014 | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Shares | Weighted-Average Grant Date Fair Value | Aggregate Value | Shares | Weighted-Average Grant Date Fair Value | Aggregate Value | Shares | Weighted-Average Grant Date Fair Value | Aggregate Value | |||||||||||||||||||||||
Non-vested at the beginning of the year | 153,399 | $ | 17.17 | 134,108 | $ | 16.66 | 119,250 | $ | 16.39 | |||||||||||||||||||||||
Granted | 53,500 | 20.76 | 36,150 | 18.50 | 41,533 | 17.65 | ||||||||||||||||||||||||||
Vested | (53,908 | ) | 16.88 | (16,359 | ) | 15.91 | (15,425 | ) | 15.59 | |||||||||||||||||||||||
Forfeited or expired | (2,250 | ) | 19.91 | (500 | ) | 18.07 | (11,250 | ) | 16.05 | |||||||||||||||||||||||
Non-vested at end of the year | 150,741 | $ | 18.50 | $ | 5,238 | 153,399 | $ | 17.17 | $ | 2,835 | 134,108 | $ | 16.66 | $ | 2,415 |
2016 | 2015 | 2014 | ||||||||||||||||||
Shares | Weighted- Average Exercise Price | Shares | Weighted- Average Exercise Price | Shares | Weighted- Average Exercise Price | |||||||||||||||
Outstanding at beginning of year | 30,012 | $ | 14.00 | 30,012 | $ | 14.00 | 58,513 | $ | 15.30 | |||||||||||
Granted | — | — | — | — | — | — | ||||||||||||||
Exercised | (6,650 | ) | 14.00 | — | — | (25,501 | ) | 14.00 | ||||||||||||
Forfeited or expired | — | — | — | — | (3,000 | ) | 39.40 | |||||||||||||
Outstanding at end of year | 23,362 | $ | 14.00 | 30,012 | $ | 14.00 | 30,012 | $ | 14.00 | |||||||||||
Options exercisable at year end | 23,362 | $ | 14.00 | 30,012 | $ | 14.00 | 30,012 | $ | 14.00 |
Range of Exercise Prices | Options Outstanding | Weighted-Average Remaining Contractual Life (years) | Options Exercisable | |||||||
$ | 14.00 | 18,362 | 2.22 | 18,362 | ||||||
$ | 14.00 | 5,000 | 2.85 | 5,000 | ||||||
$ | 14.00 | 23,362 | 2.36 | 23,362 |
Note 9. | Employee Benefit Plans |
Note 10. | Income Taxes |
(Dollars in thousands) | 2016 | 2015 | |||||
Deferred tax assets: | |||||||
Allowance for loan losses | $ | 3,877 | $ | 3,756 | |||
Deferred compensation | 687 | 647 | |||||
Interest rate swap | 67 | 99 | |||||
Other real estate owned | 288 | 257 | |||||
Securities available for sale | 654 | — | |||||
Property and equipment | — | 49 | |||||
Other | 1,427 | 2,028 | |||||
Total deferred tax assets | $ | 7,000 | $ | 6,836 | |||
Deferred tax liabilities: | |||||||
Deferred loan costs, net | $ | 526 | $ | 317 | |||
Securities available for sale | — | 965 | |||||
Property and equipment | 79 | — | |||||
Total deferred tax liabilities | $ | 605 | $ | 1,282 | |||
Net deferred tax assets | $ | 6,395 | $ | 5,554 |
(Dollars in thousands) | 2016 | 2015 | 2014 | ||||||||
Current tax expense | $ | 2,067 | $ | 2,606 | $ | 1,160 | |||||
Deferred tax expense | 746 | 109 | 1,181 | ||||||||
Total income tax expense | $ | 2,813 | $ | 2,715 | $ | 2,341 |
(Dollars in thousands) | 2016 | 2015 | 2014 | ||||||||
Computed "expected" tax expense | $ | 3,698 | $ | 3,585 | $ | 3,374 | |||||
Increase (decrease) in income taxes resulting from: | |||||||||||
Tax-exempt income | (796 | ) | (829 | ) | (959 | ) | |||||
Low income housing tax credits | (408 | ) | (120 | ) | (211 | ) | |||||
Merger related expenses | 267 | — | — | ||||||||
Other, net | 52 | 79 | 137 | ||||||||
$ | 2,813 | $ | 2,715 | $ | 2,341 |
Note 11. | Related Party Transactions |
(Dollars in thousands) | 2016 | 2015 | |||||
Balance, January 1 | $ | 1,369 | $ | 3,804 | |||
Decrease due to status changes | — | (2,375 | ) | ||||
Principal additions | 352 | 439 | |||||
Principal payments | (130 | ) | (499 | ) | |||
Balance, December 31 | $ | 1,591 | $ | 1,369 |
Note 12. | Contingent Liabilities and Commitments |
Note 13. | Earnings Per Share |
2016 | 2015 | 2014 | ||||||||||||||||||
Shares | Per Share Amount | Shares | Per Share Amount | Shares | Per Share Amount | |||||||||||||||
Earnings per share, basic | 7,107,403 | $ | 1.13 | 7,147,390 | $ | 1.10 | 7,106,171 | $ | 1.07 | |||||||||||
Effect of dilutive securities: | ||||||||||||||||||||
Stock options | 11,461 | 6,805 | 6,939 | |||||||||||||||||
Warrant (See note 23) | 32,026 | 13,192 | 13,491 | |||||||||||||||||
Earnings per share, diluted | 7,150,890 | $ | 1.13 | 7,167,387 | $ | 1.09 | 7,126,601 | $ | 1.06 |
Note 14. | Retained Earnings |
Note 15. | Financial Instruments With Off-Balance Sheet Risk and Credit Risk |
(Dollars in thousands) | 2016 | 2015 | |||||
Financial instruments whose contract amounts represent credit risk: | |||||||
Commitments to extend credit | $ | 132,669 | $ | 153,806 | |||
Standby letters of credit | 4,998 | 3,718 |
Note 16. | Fair Value Measurements |
Level I. | Quoted prices are available in active markets for identical assets or liabilities as of the reported date. |
Level II. | Pricing inputs are other than the quoted prices in active markets, which are either directly or indirectly observable as of the reported date. The nature of these assets and liabilities includes items for which quoted prices are available but traded less frequently and items that are fair-valued using other financial instruments, the parameters of which can be directly observed. |
Level III. | Assets and liabilities that have little to no pricing observability as of the reported date. These items do not have two-way markets and are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment or estimation. |
(Dollars in thousands) | December 31, 2016 | |||||||||||||||
Description | Total | Level I | Level II | Level III | ||||||||||||
Assets: | ||||||||||||||||
U.S. government agencies | $ | 73,184 | $ | — | $ | 73,184 | $ | — | ||||||||
Obligations of states and political subdivisions | 63,373 | — | 63,373 | — | ||||||||||||
Mortgage-backed securities: | ||||||||||||||||
Agency | 98,051 | — | 98,051 | — | ||||||||||||
Non-agency | 9,933 | — | 9,933 | — | ||||||||||||
Other asset backed securities | 41,605 | — | 41,605 | — | ||||||||||||
Corporate securities | 15,421 | — | 15,421 | — | ||||||||||||
Interest rate swaps | 44 | — | 44 | — | ||||||||||||
Interest rate cap | 9 | — | 9 | — | ||||||||||||
Liabilities: | ||||||||||||||||
Interest rate swaps | 242 | — | 242 | — |
(Dollars in thousands) | December 31, 2015 | |||||||||||||||
Description | Total | Level I | Level II | Level III | ||||||||||||
Assets: | ||||||||||||||||
U.S. government agencies | $ | 78,940 | $ | — | $ | 78,940 | $ | — | ||||||||
Obligations of states and political subdivisions | 75,593 | — | 75,593 | — | ||||||||||||
Mortgage-backed securities: | ||||||||||||||||
Agency | 131,661 | — | 131,661 | — | ||||||||||||
Non-agency | 12,777 | — | 12,777 | — | ||||||||||||
Other asset backed securities | 58,781 | — | 58,781 | — | ||||||||||||
Corporate securities | 16,819 | — | 16,819 | — | ||||||||||||
Interest rate swaps | 73 | — | 73 | — | ||||||||||||
Interest rate cap | 39 | — | 39 | — | ||||||||||||
Liabilities: | ||||||||||||||||
Interest rate swaps | 370 | — | 370 | — |
(Dollars in thousands) | December 31, 2016 | |||||||||||||||
Total | Level I | Level II | Level III | |||||||||||||
Assets: | ||||||||||||||||
Impaired loans | $ | 6,298 | $ | — | $ | — | $ | 6,298 | ||||||||
Other real estate owned | $ | 5,073 | $ | — | $ | — | $ | 5,073 | ||||||||
Repossessed assets | $ | 843 | $ | — | $ | — | $ | 843 | ||||||||
(Dollars in thousands) | December 31, 2015 | |||||||||||||||
Total | Level I | Level II | Level III | |||||||||||||
Assets: | ||||||||||||||||
Impaired loans | $ | 9,018 | $ | — | $ | — | $ | 9,018 | ||||||||
Other real estate owned | $ | 3,345 | $ | — | $ | — | $ | 3,345 | ||||||||
Repossessed assets | $ | 1,043 | $ | — | $ | — | $ | 1,043 |
2016 | Fair Value (in thousands) | Valuation Technique | Unobservable Inputs | Range (Weighted Average) | ||||||
Impaired loans | $ | 1,134 | Appraisals | Discount to reflect current market conditions and estimated selling costs | 0% - 100% (14%) | |||||
Impaired loans | $ | 5,164 | Present value of cash flows | Discount rate | 6% - 8% (6%) | |||||
Other real estate owned | $ | 5,073 | Appraisals | Discount to reflect current market conditions and estimated selling costs | 10% | |||||
Repossessed assets | $ | 843 | Market analysis | Discount to reflect current market conditions and estimated selling costs | 70% |
2015 | Fair Value (in thousands) | Valuation Technique | Unobservable Inputs | Range (Weighted Average) | ||||||
Impaired loans | $ | 5,434 | Appraisals | Discount to reflect current market conditions and estimated selling costs | 0% - 100% (17%) | |||||
Impaired loans | $ | 3,584 | Present value of cash flows | Discount rate | 6% - 8% (7%) | |||||
Other real estate owned | $ | 3,345 | Appraisals | Discount to reflect current market conditions and estimated selling costs | 10% | |||||
Repossessed assets | $ | 1,043 | Market analysis | Historical sales activity | 50% |
(Dollars in thousands) | December 31, 2016 | ||||||||||||||||||
Fair value measurements using: | |||||||||||||||||||
Carrying Amount | Total Fair Value | Level I | Level II | Level III | |||||||||||||||
Financial assets: | |||||||||||||||||||
Cash and cash equivalents | $ | 28,544 | $ | 28,544 | $ | 28,544 | $ | — | $ | — | |||||||||
Securities held to maturity | 10,683 | 10,095 | — | 10,095 | — | ||||||||||||||
Securities available for sale | 301,567 | 301,567 | — | 301,567 | — | ||||||||||||||
Loans, net | 848,693 | 852,280 | — | — | 852,280 | ||||||||||||||
Bank owned life insurance | 23,925 | 23,925 | — | 23,925 | — | ||||||||||||||
Accrued interest receivable | 5,093 | 5,093 | — | 5,093 | — | ||||||||||||||
Interest rate swaps | 44 | 44 | — | 44 | — | ||||||||||||||
Interest rate cap | 9 | 9 | — | 9 | — | ||||||||||||||
Financial liabilities: | |||||||||||||||||||
Deposits | $ | 1,053,058 | $ | 1,051,245 | $ | — | $ | 1,051,245 | $ | — | |||||||||
Securities sold under agreements to repurchase | 34,864 | 34,864 | — | 34,864 | — | ||||||||||||||
FHLB borrowings | 39,500 | 39,530 | — | 39,530 | — | ||||||||||||||
Subordinated notes | 5,155 | 5,159 | — | 5,159 | — | ||||||||||||||
Accrued interest payable | 387 | 387 | — | 387 | — | ||||||||||||||
Interest rate swaps | 242 | 242 | — | 242 | — |
(Dollars in thousands) | December 31, 2015 | ||||||||||||||||||
Fair value measurements using: | |||||||||||||||||||
Carrying Amount | Total Fair Value | Level I | Level II | Level III | |||||||||||||||
Financial assets: | |||||||||||||||||||
Cash and cash equivalents | $ | 39,228 | $ | 39,228 | $ | 39,228 | $ | — | $ | — | |||||||||
Securities held to maturity | 4,207 | 4,163 | — | 4,163 | — | ||||||||||||||
Securities available for sale | 374,571 | 374,571 | — | 374,571 | — | ||||||||||||||
Loans, net | 794,635 | 802,535 | — | — | 802,535 | ||||||||||||||
Bank owned life insurance | 23,273 | 23,273 | — | 23,273 | — | ||||||||||||||
Accrued interest receivable | 5,204 | 5,204 | — | 5,204 | — | ||||||||||||||
Interest rate swaps | 73 | 73 | — | 73 | — | ||||||||||||||
Interest rate cap | 39 | 39 | — | 39 | — | ||||||||||||||
Financial liabilities: | |||||||||||||||||||
Deposits | $ | 1,040,800 | $ | 1,040,016 | $ | — | $ | 1,040,016 | $ | — | |||||||||
Securities sold under agreements to repurchase | 26,869 | 26,869 | — | 26,869 | — | ||||||||||||||
FHLB borrowings | 85,000 | 85,033 | — | 85,033 | — | ||||||||||||||
Subordinated notes | 5,155 | 5,157 | — | 5,157 | — | ||||||||||||||
Accrued interest payable | 410 | 410 | — | 410 | — | ||||||||||||||
Interest rate swaps | 370 | 370 | — | 370 | — |
Note 17. | Capital Requirements |
Actual | Minimum Capital Requirement | Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions | |||||||||||||||
(Dollars in thousands) | Amount | Ratio | Amount | Ratio | Amount | Ratio | |||||||||||
As of December 31, 2016 | |||||||||||||||||
Total Capital (to Risk- Weighted Assets): | |||||||||||||||||
Consolidated | $ | 139,419 | 17.9% | $ | 62,436 | 8.0% | N/A | N/A | |||||||||
Middleburg Bank | 131,725 | 17.0% | 61,994 | 8.0% | $ | 77,492 | 10.0% | ||||||||||
Tier 1 Capital (to Risk- Weighted Assets): | |||||||||||||||||
Consolidated | $ | 129,642 | 16.6% | $ | 46,827 | 6.0% | N/A | N/A | |||||||||
Middleburg Bank | 122,016 | 15.8% | 46,495 | 6.0% | $ | 61,994 | 8.0% | ||||||||||
Common Equity Tier 1 Capital (to Risk-Weighted Assets): | |||||||||||||||||
Consolidated | $ | 124,642 | 16.0% | $ | 35,121 | 4.5% | N/A | N/A | |||||||||
Middleburg Bank | 122,016 | 15.8% | 34,872 | 4.5% | $ | 50,370 | 6.5% | ||||||||||
Tier 1 Capital (to Average Assets): | |||||||||||||||||
Consolidated | $ | 129,642 | 10.0% | $ | 52,142 | 4.0% | N/A | N/A | |||||||||
Middleburg Bank | 122,016 | 9.4% | 51,909 | 4.0% | $ | 64,886 | 5.0% | ||||||||||
As of December 31, 2015 | |||||||||||||||||
Total Capital (to Risk- Weighted Assets): | |||||||||||||||||
Consolidated | $ | 132,481 | 17.5% | $ | 60,495 | 8.0% | N/A | N/A | |||||||||
Middleburg Bank | 127,418 | 17.0% | 60,055 | 8.0% | $ | 75,068 | 10.0% | ||||||||||
Tier 1 Capital (to Risk- Weighted Assets): | |||||||||||||||||
Consolidated | $ | 123,008 | 16.3% | $ | 45,371 | 6.0% | N/A | N/A | |||||||||
Middleburg Bank | 118,013 | 15.7% | 45,041 | 6.0% | $ | 60,055 | 8.0% | ||||||||||
Common Equity Tier 1 Capital (to Risk-Weighted Assets): | |||||||||||||||||
Consolidated | $ | 118,008 | 15.6% | $ | 34,028 | 4.5% | N/A | N/A | |||||||||
Middleburg Bank | 118,013 | 15.7% | 33,781 | 4.5% | $ | 48,794 | 6.5% | ||||||||||
Tier 1 Capital (to Average Assets): | |||||||||||||||||
Consolidated | $ | 123,008 | 9.6% | $ | 51,301 | 4.0% | N/A | N/A | |||||||||
Middleburg Bank | 118,013 | 9.2% | 51,067 | 4.0% | $ | 63,834 | 5.0% |
Note 18. | Goodwill and Intangibles Assets |
December 31, 2016 | December 31, 2015 | |||||||||||||||
(Dollars In thousands) | Gross Carrying Value | Accumulated Amortization | Gross Carrying Value | Accumulated Amortization | ||||||||||||
Identifiable intangibles | $ | 3,734 | $ | 3,690 | $ | 3,734 | $ | 3,519 | ||||||||
Unamortizable goodwill | 3,421 | — | 3,421 | — |
(Dollars in thousands) | |||
2017 | $ | 44 | |
$ | 44 |
Note 19. | Subordinated Notes |
Note 20. | Ownership of Southern Trust Mortgage |
Note 21. | Condensed Financial Information – Parent Corporation Only |
BALANCE SHEETS | |||||||
December 31, | |||||||
(Dollars in thousands) | 2016 | 2015 | |||||
ASSETS | |||||||
Cash on deposit with subsidiary bank | $ | 2,154 | $ | 1,403 | |||
Investment in subsidiaries | 126,694 | 125,900 | |||||
Other assets | 3,199 | 1,686 | |||||
TOTAL ASSETS | $ | 132,047 | $ | 128,989 | |||
LIABILITIES | |||||||
Subordinated notes | $ | 5,155 | $ | 5,155 | |||
Other liabilities | 213 | 280 | |||||
TOTAL LIABILITIES | 5,368 | 5,435 | |||||
SHAREHOLDERS' EQUITY | |||||||
Common stock | 17,636 | 17,330 | |||||
Capital surplus | 45,688 | 44,155 | |||||
Retained earnings | 64,755 | 60,392 | |||||
Accumulated other comprehensive income (loss), net | (1,400 | ) | 1,677 | ||||
TOTAL SHAREHOLDERS' EQUITY | 126,679 | 123,554 | |||||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | 132,047 | $ | 128,989 |
STATEMENTS OF INCOME | |||||||||||
Year End December 31, | |||||||||||
(Dollars in thousands) | 2016 | 2015 | 2014 | ||||||||
INCOME: | |||||||||||
Dividends from subsidiaries | $ | 6,870 | $ | 5,383 | $ | 3,440 | |||||
Interest and dividends from investments | — | — | 15 | ||||||||
Other income | 2 | 17 | — | ||||||||
Total income | 6,872 | 5,400 | 3,455 | ||||||||
EXPENSES: | |||||||||||
Salaries and employee benefits | 1,240 | 919 | 746 | ||||||||
Legal and advisory fees | 1,506 | 164 | 91 | ||||||||
Directors fees | 352 | 274 | 280 | ||||||||
Interest expense | 280 | 279 | 279 | ||||||||
Other | 426 | 416 | 366 | ||||||||
Total expenses | 3,804 | 2,052 | 1,762 | ||||||||
Income before allocated tax benefits and undistributed income of subsidiaries | 3,068 | 3,348 | 1,693 | ||||||||
Income tax benefit | (1,081 | ) | (715 | ) | (753 | ) | |||||
Income before equity in undistributed income of subsidiaries | 4,149 | 4,063 | 2,446 | ||||||||
Equity in undistributed income of subsidiaries | 3,915 | 3,767 | 5,138 | ||||||||
Net income | $ | 8,064 | $ | 7,830 | $ | 7,584 |
STATEMENTS OF CASH FLOWS | |||||||||||
December 31, | |||||||||||
(Dollars in thousands) | 2016 | 2015 | 2014 | ||||||||
Cash Flows from Operating Activities | |||||||||||
Net income | $ | 8,064 | $ | 7,830 | $ | 7,584 | |||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
Equity in undistributed earnings of subsidiaries | (3,915 | ) | (3,767 | ) | (5,138 | ) | |||||
Share-based compensation | 925 | 605 | 426 | ||||||||
(Increase) decrease in other assets | (1,469 | ) | 957 | (1,099 | ) | ||||||
(Decrease) increase in other liabilities | (67 | ) | 13 | 213 | |||||||
Net cash provided by operating activities | 3,538 | 5,638 | 1,986 | ||||||||
Cash Flows from Investing Activities | |||||||||||
Proceeds from sales, calls and maturities of available for sale securities | — | — | 44 | ||||||||
Net cash provided by investing activities | — | — | 44 | ||||||||
Cash Flows from Financing Activities | |||||||||||
Net proceeds from issuance of common stock | 1,742 | — | 394 | ||||||||
Cash dividends paid on common stock | (3,701 | ) | (3,292 | ) | (2,419 | ) | |||||
Repurchases of stock | (828 | ) | (1,506 | ) | (88 | ) | |||||
Net cash used in financing activities | (2,787 | ) | (4,798 | ) | (2,113 | ) | |||||
Increase (decrease) in cash and cash equivalents | 751 | 840 | (83 | ) | |||||||
Cash and Cash Equivalents at beginning of year | 1,403 | 563 | 646 | ||||||||
Cash and Cash Equivalents at end of year | $ | 2,154 | $ | 1,403 | $ | 563 |
Note 22. | Segment Reporting |
2016 | |||||||||||||||||||
(Dollars in thousands) | Commercial & Retail Banking | Wealth Management | Mortgage Banking | Intercompany Eliminations | Consolidated | ||||||||||||||
Revenues: | |||||||||||||||||||
Interest income | $ | 43,365 | $ | 10 | $ | — | $ | — | $ | 43,375 | |||||||||
Trust services income | — | 4,806 | — | (163 | ) | 4,643 | |||||||||||||
Other income | 6,204 | — | — | (109 | ) | 6,095 | |||||||||||||
Total operating income | 49,569 | 4,816 | — | (272 | ) | 54,113 | |||||||||||||
Expenses: | |||||||||||||||||||
Interest expense | 4,424 | — | — | — | 4,424 | ||||||||||||||
Salaries and employee benefits | 16,473 | 2,284 | — | — | 18,757 | ||||||||||||||
Provision for loan losses | 1,853 | — | — | — | 1,853 | ||||||||||||||
Other expense | 17,556 | 918 | — | (272 | ) | 18,202 | |||||||||||||
Total operating expenses | 40,306 | 3,202 | — | (272 | ) | 43,236 | |||||||||||||
Income before income taxes | 9,263 | 1,614 | — | — | 10,877 | ||||||||||||||
Income tax expense | 2,203 | 610 | — | — | 2,813 | ||||||||||||||
Net income | $ | 7,060 | $ | 1,004 | $ | — | $ | — | $ | 8,064 | |||||||||
Total assets | $ | 1,270,222 | $ | 6,693 | $ | — | $ | (4,272 | ) | $ | 1,272,643 | ||||||||
Capital expenditures | $ | 978 | $ | — | $ | — | $ | — | $ | 978 | |||||||||
Goodwill and other intangibles | $ | — | $ | 3,465 | $ | — | $ | — | $ | 3,465 |
2015 | |||||||||||||||||||
(Dollars in thousands) | Commercial & Retail Banking | Wealth Management | Mortgage Banking | Intercompany Eliminations | Consolidated | ||||||||||||||
Revenues: | |||||||||||||||||||
Interest income | $ | 42,270 | $ | 11 | $ | — | $ | — | $ | 42,281 | |||||||||
Trust services income | — | 4,951 | — | (166 | ) | 4,785 | |||||||||||||
Other income | 5,605 | — | — | — | 5,605 | ||||||||||||||
Total operating income | 47,875 | 4,962 | — | (166 | ) | 52,671 | |||||||||||||
Expenses: | |||||||||||||||||||
Interest expense | 4,207 | — | — | — | 4,207 | ||||||||||||||
Salaries and employee benefits | 16,130 | 2,305 | — | — | 18,435 | ||||||||||||||
Provision for loan losses | 2,293 | — | — | — | 2,293 | ||||||||||||||
Other expense | 16,237 | 1,120 | — | (166 | ) | 17,191 | |||||||||||||
Total operating expenses | 38,867 | 3,425 | — | (166 | ) | 42,126 | |||||||||||||
Income before income taxes | 9,008 | 1,537 | — | — | 10,545 | ||||||||||||||
Income tax expense | 2,131 | 584 | — | — | 2,715 | ||||||||||||||
Net income | $ | 6,877 | $ | 953 | $ | — | $ | — | $ | 7,830 | |||||||||
Total assets | $ | 1,291,708 | $ | 6,700 | $ | — | $ | (3,545 | ) | $ | 1,294,863 | ||||||||
Capital expenditures | $ | 2,137 | $ | — | $ | — | $ | — | $ | 2,137 | |||||||||
Goodwill and other intangibles | $ | — | $ | 3,636 | $ | — | $ | — | $ | 3,636 |
2014 | |||||||||||||||||||
(Dollars in thousands) | Commercial & Retail Banking | Wealth Management | Mortgage Banking | Intercompany Eliminations | Consolidated | ||||||||||||||
Revenues: | |||||||||||||||||||
Interest income | $ | 43,149 | $ | 14 | $ | 450 | $ | (288 | ) | $ | 43,325 | ||||||||
Trust services income | — | 4,516 | — | (154 | ) | 4,362 | |||||||||||||
Other income | 5,349 | — | 5,121 | (46 | ) | 10,424 | |||||||||||||
Total operating income | 48,498 | 4,530 | 5,571 | (488 | ) | 58,111 | |||||||||||||
Expenses: | |||||||||||||||||||
Interest expense | 5,227 | — | 304 | (288 | ) | 5,243 | |||||||||||||
Salaries and employee benefits | 16,567 | 2,262 | 3,772 | — | 22,601 | ||||||||||||||
Provision for loan losses | 1,926 | — | 34 | — | 1,960 | ||||||||||||||
Other expense | 15,818 | 1,140 | 1,722 | (200 | ) | 18,480 | |||||||||||||
Total operating expenses | 39,538 | 3,402 | 5,832 | (488 | ) | 48,284 | |||||||||||||
Income before income taxes and non-controlling interest | 8,960 | 1,128 | (261 | ) | — | 9,827 | |||||||||||||
Income tax expense | 1,894 | 447 | — | — | 2,341 | ||||||||||||||
Net income | 7,066 | 681 | (261 | ) | — | 7,486 | |||||||||||||
Non-controlling interest in consolidated subsidiary | — | — | 98 | — | 98 | ||||||||||||||
Net income attributable to Middleburg Financial Corporation | $ | 7,066 | $ | 681 | $ | (163 | ) | $ | — | $ | 7,584 | ||||||||
Total assets | $ | 1,218,452 | $ | 7,152 | $ | — | $ | (2,747 | ) | $ | 1,222,857 | ||||||||
Capital expenditures | $ | 911 | $ | 6 | $ | 3 | $ | — | $ | 920 | |||||||||
Goodwill and other intangibles | $ | — | $ | 3,807 | $ | — | $ | — | $ | 3,807 |
Note 23. | Capital Purchase Program and Stock Warrant |
Note 24. | Derivatives |
December 31, 2016 | |||||||||||||||||||||
(Dollars in thousands) | Positions (#) | Notional Amount | Asset | Liability | Receive Rate | Pay Rate | Life (Years) | ||||||||||||||
Pay fixed - receive floating interest rate swap | 1 | $ | 5,155 | $ | — | $ | 160 | 0.87 | % | 2.59 | % | 3.8 | |||||||||
Pay fixed - receive floating interest rate swap | 1 | $ | 10,000 | $ | — | $ | 38 | 0.60 | % | 1.43 | % | 2.0 |
December 31, 2015 | |||||||||||||||||||||
(Dollars in thousands) | Positions (#) | Notional Amount | Asset | Liability | Receive Rate | Pay Rate | Life (Years) | ||||||||||||||
Pay fixed - receive floating interest rate swap | 1 | $ | 5,155 | $ | — | $ | 226 | 0.32 | % | 2.59 | % | 4.8 | |||||||||
Pay fixed - receive floating interest rate swap | 1 | $ | 10,000 | $ | — | $ | 71 | 0.23 | % | 1.43 | % | 3.0 |
December 31, 2016 | ||||||||||||||||||||||
(Dollars in thousands) | Positions (#) | Notional Amount | Asset | Liability | Receive Rate | Pay Rate | Life (Years) | |||||||||||||||
Pay fixed - receive floating interest rate swap | 1 | $ | 3,508 | $ | 15 | $ | — | 1 month LIBOR plus 200 BP | 3.90 | % | 10.9 | |||||||||||
Pay fixed - receive floating interest rate swap | 1 | 1,663 | — | 29 | 1 month LIBOR plus 180 BP | 4.09 | % | 7.9 | ||||||||||||||
Pay floating - receive fixed interest rate swap | 1 | 3,508 | — | 15 | 3.90 | % | 1 month LIBOR plus 200 BP | 10.9 | ||||||||||||||
Pay floating - receive fixed interest rate swap | 1 | 1,663 | 29 | — | 4.09 | % | 1 month LIBOR plus 180 BP | 7.9 | ||||||||||||||
Total derivatives not designated | $ | 10,342 | $ | 44 | $ | 44 |
December 31, 2015 | ||||||||||||||||||||||
(Dollars in thousands) | Positions (#) | Notional Amount (in thousands) | Asset | Liability | Receive Rate | Pay Rate | Life (Years) | |||||||||||||||
Pay fixed - receive floating interest rate swap | 1 | $ | 3,760 | $ | — | $ | 21 | 1 month LIBOR plus 200 BP | 3.90 | % | 11.9 | |||||||||||
Pay fixed - receive floating interest rate swap | 1 | 1,706 | — | 52 | 1 month LIBOR plus 180 BP | 4.09 | % | 8.9 | ||||||||||||||
Pay floating - receive fixed interest rate swap | 1 | 3,760 | 21 | — | 3.90 | % | 1 month LIBOR plus 200 BP | 11.9 | ||||||||||||||
Pay floating - receive fixed interest rate swap | 1 | 1,706 | 52 | — | 4.09 | % | 1 month LIBOR plus 180 BP | 8.9 | ||||||||||||||
Total derivatives not designated | $ | 10,932 | $ | 73 | $ | 73 |
December 31, 2016 | |||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
Notional Amount | Termination Date | 3-Month LIBOR Strike Rate | Premium Paid | Unamortized Premium at December 31, 2016 | Fair Value December 31, 2016 | Cumulative Cash Flows Received | |||||||||||||||||
$ | 10,000 | September 8, 2018 | 2.00 | % | $ | 70 | $ | 70 | $ | 9 | $ | — |
December 31, 2015 | ||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||
Notional Amount | Termination Date | 3-Month LIBOR Strike Rate | Premium Paid | Unamortized Premium at December 31, 2015 | Fair Value December 31, 2015 | Cumulative Cash Flows Received | ||||||||||||||||
$ | 10,000 | September 8, 2018 | 2.00 | % | $ | 70 | $ | 70 | $ | 39 | — |
Note 25. | Accumulated Other Comprehensive Income (Loss), Net |
(Dollars in thousands) | Unrealized Gains (Losses) on Securities | Cash Flow Hedges | Accumulated Other Comprehensive Income (Loss), Net | ||||||||
Balance December 31, 2013 | $ | 261 | $ | (29 | ) | $ | 232 | ||||
Unrealized holding gains (net of tax, $1,979) | 3,841 | — | 3,841 | ||||||||
Reclassification adjustment (net of tax, $63) | (123 | ) | — | (123 | ) | ||||||
Unrealized gains on interest rate swaps (net of tax, $82) | — | (160 | ) | (160 | ) | ||||||
Reclassification adjustment (net of tax, $2) | — | 4 | 4 | ||||||||
Balance December 31, 2014 | 3,979 | (185 | ) | 3,794 | |||||||
Unrealized holding losses (net of tax, $1,037) | (2,015 | ) | — | (2,015 | ) | ||||||
Reclassification adjustment (net of tax, $48) | (92 | ) | — | (92 | ) | ||||||
Unrealized gains on interest rate swaps (net of tax, $3) | — | (6 | ) | (6 | ) | ||||||
Reclassification adjustment (net of tax, $2) | — | (4 | ) | (4 | ) | ||||||
Balance December 31, 2015 | 1,872 | (195 | ) | 1,677 | |||||||
Unrealized holding losses (net of tax, $1,091) | (2,116 | ) | — | (2,116 | ) | ||||||
Reclassification adjustment (net of tax, $528) | (1,026 | ) | — | (1,026 | ) | ||||||
Unrealized losses on interest rate swaps (net of tax, ($34)) | — | 65 | 65 | ||||||||
Balance December 31, 2016 | $ | (1,270 | ) | $ | (130 | ) | $ | (1,400 | ) |
Details about Accumulated Other Comprehensive Income (Loss) | Amount Reclassified from Accumulated Other Comprehensive Income (Loss) | Affected Line Item in the Consolidated Statements of Income | |||||||||||
(Dollars in thousands) | 2016 | 2015 | 2014 | ||||||||||
Securities available for sale (1): | |||||||||||||
Net securities gains reclassified into earnings | $ | (1,554 | ) | $ | (140 | ) | $ | (186 | ) | Gains on sales of securities available for sale, net | |||
Related income tax expense | 528 | 48 | 63 | Income tax expense | |||||||||
Derivatives (2): | |||||||||||||
(Gain) loss on interest rate swap ineffectiveness | — | (6 | ) | 6 | Other operating expense | ||||||||
Related income tax benefit | — | 2 | (2 | ) | Income tax expense | ||||||||
Net effect on accumulated other comprehensive income (loss) for the period | (1,026 | ) | (96 | ) | (119 | ) | Net of tax | ||||||
Total reclassifications for the period | $ | (1,026 | ) | $ | (96 | ) | $ | (119 | ) | Net of tax |
Note 26. | Other Real Estate Owned ("OREO") |
(Dollars in thousands) | December 31, 2016 | December 31, 2015 | |||||
Balance at the beginning of year, net | $ | 3,345 | $ | 4,051 | |||
Transfers from loans, net | 2,645 | 287 | |||||
Purchased loans | 40 | — | |||||
Sales proceeds | (713 | ) | (814 | ) | |||
Gain (loss) on disposition | 66 | (100 | ) | ||||
Less valuation adjustments | (310 | ) | (79 | ) | |||
Balance at the end of year, net | $ | 5,073 | $ | 3,345 |
(Dollars in thousands) | December 31, 2016 | December 31, 2015 | |||||
Real estate loans: | |||||||
Construction | $ | 946 | $ | 853 | |||
Secured by 1-4 family residential | 3,767 | 1,958 | |||||
Other real estate loans | 360 | 534 | |||||
Total real estate loans | $ | 5,073 | $ | 3,345 |
Note 27. | Low Income Housing Tax Credits |
Name of Subsidiary | State of Organization | ||
MFC Capital Trust II | Delaware | ||
Middleburg Bank | Virginia | ||
Middleburg Bank Service Corporation | Virginia | ||
Middleburg Investment Group, Inc. | Virginia | ||
Middleburg Trust Company | Virginia | ||
/s/ John C. Lee, IV | /s/ Keith W. Meurlin | |
Name: John C. Lee, IV | Name: Keith W. Meurlin | |
/s/ Howard M. Armfield | /s/ Janet A. Neuharth | |
Name: Howard M. Armfield | Name: Janet A. Neuharth | |
/s/ Henry F. Atherton, III | /s/ John M. Rust | |
Name: Henry F. Atherton, III | Name: John M. Rust | |
/s/ Childs F. Burden | /s/ Gary R. Shook | |
Name: Childs F. Burden | Name: Gary R. Shook | |
/s/ Alexander G. Green, III | /s/ Mary Leigh McDaniel | |
Name: Alexander G. Green, III | Name: Mary Leigh McDaniel | |
/s/ Gary D. LeClair | ||
Name: Gary D. LeClair |
1. | I have reviewed this Annual Report on Form 10-K for the year ended December 31, 2016 of Middleburg 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: | March 15, 2017 | /s/ Gary R. Shook |
Gary R. Shook President and Chief Executive Officer |
1. | I have reviewed this Annual Report on Form 10-K for the year ended December 31, 2016 of Middleburg 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; |
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: | March 15, 2017 | /s/ Raj Mehra |
Raj Mehra Executive Vice President & Chief Financial Officer |
(a) | the Form 10-K fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended; and |
(b) | the information contained in the Form 10-K fairly presents, in all material respects, the consolidated financial condition and results of operations of the Company and its subsidiaries as of, and for, the periods presented in the Form 10-K. |
Date: | March 15, 2017 | By: | /s/ Gary R. Shook |
Gary R. Shook | |||
President and Chief Executive Officer |
Date: | March 15, 2017 | By: | /s/ Raj Mehra |
Raj Mehra | |||
Executive Vice President and Chief Financial Officer |
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$ in Thousands12 Months Ended
Document and Entity Information [Abstract]
Entity Registrant Name
MIDDLEBURG FINANCIAL CORP
Entity Central Index Key
0000914138
Current Fiscal Year End Date
--12-31
Entity Well-known Seasoned Issuer
No
Entity Voluntary Filers
No
Entity Current Reporting Status
Yes
Entity Filer Category
Accelerated Filer
Entity Public Float
$ 193,158
Entity Common Stock, Shares Outstanding
7,200,194
Document Fiscal Year Focus
2016
Document Fiscal Period Focus
FY
Document Type
10-K
Amendment Flag
false
Document Period End Date
Dec. 31, 2016
$ in Thousands
Statement of Financial Position [Abstract]
Securities held to maturity, fair value
$ 10,095
$ 4,163
ASSETS
Loans, allowance for loan losses
$ 11,404
$ 11,046
SHAREHOLDERS' EQUITY
Common stock, par value (in dollars per share)
$ 2.50
$ 2.50
Common stock, shares authorized (in shares)
20,000,000
20,000,000
Common stock, shares issued (in shares)
7,205,066
7,085,217
Common stock, shares outstanding (in shares)
7,205,066
7,085,217
$ in Thousands12 Months Ended
Other comprehensive income (loss), net of tax:
Unrealized holding gains arising during the period, tax
$ 1,091
$ 1,037
$ (1,979)
Reclassification adjustment for gains included in net income, tax
528
48
63
Unrealized gain (loss) on interest rate swap, tax
(34)
3
82
Reclassification adjustment for (gain) loss on interest rate swap ineffectiveness, tax
$ 0
$ 2
$ (2)
12 Months Ended
Cash dividends:
Cash dividends, Common stock (in dollars per share)
$ 0.52
$ 0.46
$ 0.34
Restricted stock vesting (in shares)
53,908
16,359
15,425
Repurchase of restricted stock (in shares)
15,351
4,576
4,732
Exercise of stock options (in shares)
6,650
0
25,501
Exercise of stock warrant (in shares)
104,101
Repurchase of common stock (in shares)
26,800
77,500
12 Months Ended
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Nature of Banking Activities and Significant Accounting Policies
12 Months Ended
Investments, Debt and Equity Securities [Abstract]
Securities
Unrealized Losses
Unrealized Losses
Unrealized Losses
12 Months Ended
Receivables [Abstract]
Loans, Net
12 Months Ended
Allowance for Loan Losses [Abstract]
Allowance for Loan Losses
12 Months Ended
Property, Plant and Equipment [Abstract]
Premises and Equipment, Net
12 Months Ended
Banking and Thrift [Abstract]
Deposits
12 Months Ended
Debt Disclosure [Abstract]
Borrowings
12 Months Ended
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Share-Based Compensation Plan
12 Months Ended
Compensation and Retirement Disclosure [Abstract]
Employee Benefit Plans
12 Months Ended
Income Tax Disclosure [Abstract]
Income Taxes
12 Months Ended
Related Party Transactions [Abstract]
Related Party Transactions
12 Months Ended
Commitments and Contingencies Disclosure [Abstract]
Contingent Liabilities and Commitments
12 Months Ended
Earnings Per Share [Abstract]
Earnings Per Share
12 Months Ended
Equity [Abstract]
Retained Earnings
12 Months Ended
Risks and Uncertainties [Abstract]
Financial Instruments With Off-Balance Sheet Risk and Credit Risk
12 Months Ended
Fair Value Disclosures [Abstract]
Fair Value Measurements
Amount
Amount
12 Months Ended
Regulatory Capital Requirements [Abstract]
Capital Requirements
12 Months Ended
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill and Intangibles Assets
12 Months Ended
Trust Preferred Capital Notes [Abstract]
Subordinated Notes
12 Months Ended
Business Combinations [Abstract]
Ownership of Southern Trust Mortgage
12 Months Ended
Condensed Financial Information of Parent Company Only Disclosure [Abstract]
Condensed Financial Information - Parent Corporation Only
12 Months Ended
Segment Reporting [Abstract]
Segment Reporting
12 Months Ended
Stockholders' Equity Note [Abstract]
Capital Purchase Program and Stock Warrant
12 Months Ended
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivatives
12 Months Ended
Equity [Abstract]
Accumulated Other Comprehensive Income (Loss), Net
12 Months Ended
Banking and Thrift [Abstract]
Other Real Estate Owned (OREO)
12 Months Ended
Federal Home Loan Banks [Abstract]
Low Income Housing Tax Credits
12 Months Ended
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Principles of Consolidation
Securities
Loans
Allowance for Loan Losses
Loan Charge-off Policies
Impaired Loans
Troubled Debt Restructurings
Mortgage Loans Held for Sale
Premises and Equipment
Other Real Estate Owned and Repossessed Assets
Goodwill and Intangible Assets
Bank-Owned Life Insurance
Income Taxes
Trust Company Assets
Earnings Per Share
Cash and Cash Equivalents
Use of Estimates
Advertising Costs
Comprehensive Income
Securities Sold Under Agreements to Repurchase
Derivative Financial Instruments
Reclassifications
Transfers of Financial Assets
Share-Based Employee Compensation Plan
Recent Accounting Pronouncements
12 Months Ended
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Estimated useful lives of property and equipment
12 Months Ended
Investments, Debt and Equity Securities [Abstract]
Held to Maturity Securities
Amortized Costs and Fair Values of Securities Available for Sale
Amortized Cost and Fair Value of Securities Available for Sale by Contractual Maturity
Investments in Continuous Unrealized Loss Position
Unrealized Losses
Unrealized Losses
Unrealized Losses
12 Months Ended
Receivables [Abstract]
Consolidated loan portfolio
Past due loans by class of loans
Summary of loan classifications by class of loan
Loans identified as impaired by class of loan
Loans modified in TDR by class of loan
12 Months Ended
Allowance for Loan Losses [Abstract]
Allowance for loan losses
12 Months Ended
Property, Plant and Equipment [Abstract]
Schedule of premises and equipment
Schedule of future minimum rent commitments under various operating leases
12 Months Ended
Banking and Thrift [Abstract]
Scheduled maturities of time deposits
12 Months Ended
Debt Disclosure [Abstract]
Contractual maturities of the Company's long-term debt
Federal Funds Purchased, Securities Sold Under Agreements to Repurchase and Short-term Borrowings
12 Months Ended
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Restricted stock service awards awarded under the 2006 Equity Compensation Plan
Stock options outstanding activity
Schedule of options outstanding and exercisable
12 Months Ended
Income Tax Disclosure [Abstract]
Schedule of net deferred tax assets
Provision for income taxes charged to operations
Income tax provision differs from federal income tax rate to pretax income
12 Months Ended
Related Party Transactions [Abstract]
Loans outstanding to directors and executive officers
12 Months Ended
Earnings Per Share [Abstract]
Weighted-average number of shares used in computing earnings (loss) per share and the effect on weighted-average number of shares of diluted potential common stock
12 Months Ended
Risks and Uncertainties [Abstract]
Summary of the contract amount of the Company's exposure to off-balance-sheet risk
12 Months Ended
Fair Value Disclosures [Abstract]
Financial assets and liabilities measured at fair value on a recurring basis
Estimated fair values and related carrying amounts of financial instruments
Amount
Amount
Quantitative information about Level III fair value measurements
12 Months Ended
Regulatory Capital Requirements [Abstract]
Schedule of actual capital amounts and ratios
12 Months Ended
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of intangible assets and goodwill
Estimated amortization expense of identifiable intangibles
12 Months Ended
Condensed Financial Information of Parent Company Only Disclosure [Abstract]
BALANCE SHEETS
STATEMENTS OF INCOME
STATEMENTS OF CASH FLOWS
12 Months Ended
Segment Reporting [Abstract]
Schedule of reportable segments and reconciliation to the consolidated financial statements
12 Months Ended
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative designated as a cash flow hedge
Two-way client interest rate swaps not designated as either fair value or cash flow hedges
Details of interest rate cap agreement
12 Months Ended
Equity [Abstract]
Changes in accumulated other comprehensive income
Reclassifications from accumulated other comprehensive income
12 Months Ended
Banking and Thrift [Abstract]
Changes in the Balance for OREO
Schedule of Real Estate Owned Classifications
$ in Thousands
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Merger share distribution (in shares)
1.3314
Ownership interest in Southern Trust Mortgage
62.30%
Investment in subsidiaries
$ 155
$ 155
12 Months Ended
Buildings and Improvements [Member] | Minimum [Member]
Premises and Equipment [Abstract]
Estimated useful life
10 years
Buildings and Improvements [Member] | Maximum [Member]
Premises and Equipment [Abstract]
Estimated useful life
40 years
Furniture and Equipment [Member] | Minimum [Member]
Premises and Equipment [Abstract]
Estimated useful life
3 years
Furniture and Equipment [Member] | Maximum [Member]
Premises and Equipment [Abstract]
Estimated useful life
15 years
12 Months Ended
Customer Relationships [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Expected life of intangible assets
15 years
12 Months Ended
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Maturity period of federal funds sold and purchase
1 day
$ in Thousands12 Months Ended
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Share-based compensation
$ 925
$ 605
$ 426
$ in Thousands
Schedule of Held-to-maturity Securities [Line Items]
Amortized Cost
$ 10,683
$ 4,207
Gross Unrealized Gains
21
24
Gross Unrealized Losses
(609)
(68)
Fair Value
10,095
4,163
Obligations of states and political subdivisions [Member]
Schedule of Held-to-maturity Securities [Line Items]
Amortized Cost
6,433
1,457
Gross Unrealized Gains
0
0
Gross Unrealized Losses
(594)
(38)
Fair Value
5,839
1,419
Corporate Debt Securities [Member]
Schedule of Held-to-maturity Securities [Line Items]
Amortized Cost
4,250
2,750
Gross Unrealized Gains
21
24
Gross Unrealized Losses
(15)
(30)
Fair Value
$ 4,256
$ 2,744
$ in Thousands
Amortized cost
Due after five years through ten years
$ 4,250
Due after ten years
6,433
Amortized Cost
10,683
$ 4,207
Fair value
Due after five years through ten years
4,256
Due after ten years
5,839
Fair Value
$ 10,095
$ 4,163
$ in Thousands
Amortized Cost [Abstract]
Due in one year or less
$ 777
Due after one year through five years
9,020
Due after five years through ten years
25,004
Due after ten years
118,289
Total
303,490
Fair Value [Abstract]
Due in one year or less
777
Due after one year through five years
9,219
Due after five years through ten years
24,174
Due after ten years
117,808
Total
301,567
Mortgage-backed securities [Member]
Amortized Cost [Abstract]
Total
108,540
Fair Value [Abstract]
Total
107,984
Other Asset Backed Securities [Member]
Amortized Cost [Abstract]
Total
41,860
Fair Value [Abstract]
Total
$ 41,605
12 Months Ended
Investments, Debt and Equity Securities [Abstract]
Proceeds from sales of securities
$ 79,300,000
$ 11,600,000
$ 58,900,000
Proceeds from maturity, calls, principal repayments and sales of securities available for sale
76,200,000
89,900,000
73,400,000
Gross gains realized on sale of securities
1,500,000
172,000
770,000
Gross loss realized on sale of securities
28,000
37,000
584,000
Net impairment losses
0
0
0
Tax expense related to realized gains
528,000
48,000
$ 63,000
Carrying value of securities pledged for fiduciary powers
$ 115,700,000
$ 113,100,000
Number of securities temporarily impaired | Security
256
Number of securities temporarily impaired in investment grade | Security
251
Number of securities temporarily impaired in speculative grade | Security
5
12 Months Ended
Investments, Debt and Equity Securities [Abstract]
Credit losses recognized in prior period earnings
$ 0
$ 0
$ 0
Investment in FHLB stock
2,800,000
4,700,000
Federal Reserve Bank Stock
$ 1,700,000
$ 1,700,000
$ in Thousands
Past due loans by class of loans [Abstract]
Total Past Due
$ 7,766
$ 3,327
Current
852,331
802,354
Total Loans
860,097
[1]
805,681
[1]
$ 754,846
Real Estate Loans Construction [Member]
Past due loans by class of loans [Abstract]
Total Past Due
0
69
Current
35,627
39,604
Total Loans
35,627
39,673
33,050
Real Estate Loans Secured by Farmland [Member]
Past due loans by class of loans [Abstract]
Total Past Due
199
0
Current
16,569
19,062
Total Loans
16,768
19,062
Real Estate Loans Secured by 1 - 4 Family Residential [Member]
Past due loans by class of loans [Abstract]
Total Past Due
514
1,376
Current
313,531
278,720
Total Loans
314,045
280,096
265,216
Other Real Estate Loans [Member]
Past due loans by class of loans [Abstract]
Total Past Due
2,416
573
Current
281,197
257,462
Total Loans
283,613
258,035
255,236
Commercial Loans [Member]
Past due loans by class of loans [Abstract]
Total Past Due
2,674
1,288
Current
188,093
189,194
Total Loans
190,767
190,482
163,269
Consumer Loans [Member]
Past due loans by class of loans [Abstract]
Total Past Due
1,963
21
Current
17,314
18,312
Total Loans
19,277
18,333
$ 18,367
Financing Receivables, 30 to 59 Days Past Due [Member]
Past due loans by class of loans [Abstract]
Total Past Due
546
1,899
Financing Receivables, 30 to 59 Days Past Due [Member] | Real Estate Loans Construction [Member]
Past due loans by class of loans [Abstract]
Total Past Due
0
69
Financing Receivables, 30 to 59 Days Past Due [Member] | Real Estate Loans Secured by Farmland [Member]
Past due loans by class of loans [Abstract]
Total Past Due
0
0
Financing Receivables, 30 to 59 Days Past Due [Member] | Real Estate Loans Secured by 1 - 4 Family Residential [Member]
Past due loans by class of loans [Abstract]
Total Past Due
0
259
Financing Receivables, 30 to 59 Days Past Due [Member] | Other Real Estate Loans [Member]
Past due loans by class of loans [Abstract]
Total Past Due
312
325
Financing Receivables, 30 to 59 Days Past Due [Member] | Commercial Loans [Member]
Past due loans by class of loans [Abstract]
Total Past Due
146
1,242
Financing Receivables, 30 to 59 Days Past Due [Member] | Consumer Loans [Member]
Past due loans by class of loans [Abstract]
Total Past Due
88
4
Financing Receivables, 60 to 89 Days Past Due [Member]
Past due loans by class of loans [Abstract]
Total Past Due
213
32
Financing Receivables, 60 to 89 Days Past Due [Member] | Real Estate Loans Construction [Member]
Past due loans by class of loans [Abstract]
Total Past Due
0
0
Financing Receivables, 60 to 89 Days Past Due [Member] | Real Estate Loans Secured by Farmland [Member]
Past due loans by class of loans [Abstract]
Total Past Due
199
0
Financing Receivables, 60 to 89 Days Past Due [Member] | Real Estate Loans Secured by 1 - 4 Family Residential [Member]
Past due loans by class of loans [Abstract]
Total Past Due
0
0
Financing Receivables, 60 to 89 Days Past Due [Member] | Other Real Estate Loans [Member]
Past due loans by class of loans [Abstract]
Total Past Due
0
0
Financing Receivables, 60 to 89 Days Past Due [Member] | Commercial Loans [Member]
Past due loans by class of loans [Abstract]
Total Past Due
10
15
Financing Receivables, 60 to 89 Days Past Due [Member] | Consumer Loans [Member]
Past due loans by class of loans [Abstract]
Total Past Due
4
17
Financing Receivables, Equal to Greater than 90 Days Past Due [Member]
Past due loans by class of loans [Abstract]
Total Past Due
7,007
1,396
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | Real Estate Loans Construction [Member]
Past due loans by class of loans [Abstract]
Total Past Due
0
0
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | Real Estate Loans Secured by Farmland [Member]
Past due loans by class of loans [Abstract]
Total Past Due
0
0
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | Real Estate Loans Secured by 1 - 4 Family Residential [Member]
Past due loans by class of loans [Abstract]
Total Past Due
514
1,117
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | Other Real Estate Loans [Member]
Past due loans by class of loans [Abstract]
Total Past Due
2,104
248
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | Commercial Loans [Member]
Past due loans by class of loans [Abstract]
Total Past Due
2,518
31
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | Consumer Loans [Member]
Past due loans by class of loans [Abstract]
Total Past Due
$ 1,871
$ 0
[1]
Includes net deferred loan costs and premiums of $3.3 million and $3.5 million, respectively.
$ in Thousands
Financing Receivable, Recorded Investment, Past Due [Line Items]
Nonaccrual
$ 8,359
$ 8,784
Past due 90 days or more and still accruing
781
278
Real Estate Loans Construction [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Nonaccrual
29
204
Past due 90 days or more and still accruing
0
0
Real Estate Loans Secured by 1 - 4 Family Residential [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Nonaccrual
296
4,460
Past due 90 days or more and still accruing
303
0
Other Real Estate Loans [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Nonaccrual
1,976
1,186
Past due 90 days or more and still accruing
128
248
Commercial Loans [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Nonaccrual
4,187
1,036
Past due 90 days or more and still accruing
350
30
Consumer Loans [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Nonaccrual
1,871
1,898
Past due 90 days or more and still accruing
$ 0
$ 0
$ in Thousands
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
$ 860,097
[1]
$ 805,681
[1]
$ 754,846
Pass [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
826,057
756,048
Special Mention [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
10,168
20,854
Substandard [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
19,431
25,920
Doubtful [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
4,269
2,858
Loss [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
172
1
Real Estate Loans Construction [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
35,627
39,673
33,050
Real Estate Loans Construction [Member] | Pass [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
30,065
30,114
Real Estate Loans Construction [Member] | Special Mention [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
5,534
9,024
Real Estate Loans Construction [Member] | Substandard [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
28
535
Real Estate Loans Construction [Member] | Doubtful [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
0
0
Real Estate Loans Construction [Member] | Loss [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
0
0
Real Estate Loans Secured by Farmland [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
16,768
19,062
Real Estate Loans Secured by Farmland [Member] | Pass [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
8,796
10,566
Real Estate Loans Secured by Farmland [Member] | Special Mention [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
0
0
Real Estate Loans Secured by Farmland [Member] | Substandard [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
7,972
8,496
Real Estate Loans Secured by Farmland [Member] | Doubtful [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
0
0
Real Estate Loans Secured by Farmland [Member] | Loss [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
0
0
Real Estate Loans Secured by 1 - 4 Family Residential [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
314,045
280,096
265,216
Real Estate Loans Secured by 1 - 4 Family Residential [Member] | Pass [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
310,233
271,721
Real Estate Loans Secured by 1 - 4 Family Residential [Member] | Special Mention [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
932
896
Real Estate Loans Secured by 1 - 4 Family Residential [Member] | Substandard [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
2,584
6,818
Real Estate Loans Secured by 1 - 4 Family Residential [Member] | Doubtful [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
125
661
Real Estate Loans Secured by 1 - 4 Family Residential [Member] | Loss [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
171
0
Other Real Estate Loans [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
283,613
258,035
255,236
Other Real Estate Loans [Member] | Pass [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
274,591
243,768
Other Real Estate Loans [Member] | Special Mention [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
2,287
7,254
Other Real Estate Loans [Member] | Substandard [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
4,759
5,827
Other Real Estate Loans [Member] | Doubtful [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
1,976
1,186
Other Real Estate Loans [Member] | Loss [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
0
0
Commercial Loans [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
190,767
190,482
163,269
Commercial Loans [Member] | Pass [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
185,030
183,532
Commercial Loans [Member] | Special Mention [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
1,390
3,638
Commercial Loans [Member] | Substandard [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
2,179
2,301
Commercial Loans [Member] | Doubtful [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
2,168
1,011
Commercial Loans [Member] | Loss [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
0
0
Consumer Loans [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
19,277
18,333
$ 18,367
Consumer Loans [Member] | Pass [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
17,342
16,347
Consumer Loans [Member] | Special Mention [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
25
42
Consumer Loans [Member] | Substandard [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
1,909
1,943
Consumer Loans [Member] | Doubtful [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
0
0
Consumer Loans [Member] | Loss [Member]
Summary of loan classifications by class of loan [Abstract]
Summary of loan quality by class of loan
$ 1
$ 1
[1]
Includes net deferred loan costs and premiums of $3.3 million and $3.5 million, respectively.
$ in Thousands12 Months Ended
Recorded Investment [Abstract]
With no related allowance recorded
$ 10,633
$ 9,162
With an allowance recorded
10,136
11,682
Total
20,769
20,844
Unpaid Principal Balance [Abstract]
With no related allowance recorded
13,669
9,232
With an allowance recorded
10,187
14,734
Total
23,856
23,966
Related Allowance [Abstract]
With no related allowance recorded
0
0
With an allowance recorded
3,838
2,664
Total
3,838
2,664
Average Recorded Investment [Abstract]
With no related allowance recorded
10,733
9,202
With an allowance recorded
11,173
13,644
Total
21,906
22,846
Interest Income Recognized [Abstract]
With no related allowance recorded
257
254
With an allowance recorded
200
284
Total
457
538
Real Estate Loans Construction [Member]
Recorded Investment [Abstract]
With no related allowance recorded
28
100
With an allowance recorded
0
103
Unpaid Principal Balance [Abstract]
With no related allowance recorded
28
100
With an allowance recorded
0
103
Related Allowance [Abstract]
With no related allowance recorded
0
0
With an allowance recorded
0
53
Average Recorded Investment [Abstract]
With no related allowance recorded
28
106
With an allowance recorded
0
109
Interest Income Recognized [Abstract]
With no related allowance recorded
0
0
With an allowance recorded
0
0
Real Estate Loans Secured by Farmland [Member]
Recorded Investment [Abstract]
With no related allowance recorded
7,972
7,903
With an allowance recorded
0
0
Unpaid Principal Balance [Abstract]
With no related allowance recorded
7,972
7,903
With an allowance recorded
0
0
Related Allowance [Abstract]
With no related allowance recorded
0
0
With an allowance recorded
0
0
Average Recorded Investment [Abstract]
With no related allowance recorded
7,951
7,903
With an allowance recorded
0
0
Interest Income Recognized [Abstract]
With no related allowance recorded
239
237
With an allowance recorded
0
0
Real Estate Loans Secured by 1 - 4 Family Residential [Member]
Recorded Investment [Abstract]
With no related allowance recorded
72
701
With an allowance recorded
1,275
4,426
Unpaid Principal Balance [Abstract]
With no related allowance recorded
108
736
With an allowance recorded
1,326
4,478
Related Allowance [Abstract]
With no related allowance recorded
0
0
With an allowance recorded
251
1,120
Average Recorded Investment [Abstract]
With no related allowance recorded
72
703
With an allowance recorded
1,239
4,547
Interest Income Recognized [Abstract]
With no related allowance recorded
2
0
With an allowance recorded
49
27
Other Real Estate Loans [Member]
Recorded Investment [Abstract]
With no related allowance recorded
1,976
0
With an allowance recorded
2,971
4,196
Unpaid Principal Balance [Abstract]
With no related allowance recorded
1,976
0
With an allowance recorded
2,971
4,196
Related Allowance [Abstract]
With no related allowance recorded
0
0
With an allowance recorded
206
464
Average Recorded Investment [Abstract]
With no related allowance recorded
1,976
0
With an allowance recorded
2,975
4,224
Interest Income Recognized [Abstract]
With no related allowance recorded
0
0
With an allowance recorded
151
157
Commercial Loans [Member]
Recorded Investment [Abstract]
With no related allowance recorded
585
458
With an allowance recorded
4,019
1,059
Unpaid Principal Balance [Abstract]
With no related allowance recorded
3,585
493
With an allowance recorded
4,019
4,059
Related Allowance [Abstract]
With no related allowance recorded
0
0
With an allowance recorded
2,539
27
Average Recorded Investment [Abstract]
With no related allowance recorded
706
490
With an allowance recorded
5,088
2,315
Interest Income Recognized [Abstract]
With no related allowance recorded
16
17
With an allowance recorded
0
100
Consumer Loans [Member]
Recorded Investment [Abstract]
With no related allowance recorded
0
0
With an allowance recorded
1,871
1,898
Unpaid Principal Balance [Abstract]
With no related allowance recorded
0
0
With an allowance recorded
1,871
1,898
Related Allowance [Abstract]
With no related allowance recorded
0
0
With an allowance recorded
842
1,000
Average Recorded Investment [Abstract]
With no related allowance recorded
0
0
With an allowance recorded
1,871
2,449
Interest Income Recognized [Abstract]
With no related allowance recorded
0
0
With an allowance recorded
$ 0
$ 0
$ in Thousands12 Months Ended
Loans modified in a TDR by class of loan [Abstract]
Number of Contracts | loan
5
7
Pre-Modification Outstanding Recorded Investment
$ 2,087
$ 15,236
Post-Modification Outstanding Recorded Investment
$ 2,084
$ 14,821
Real Estate Loans Construction [Member]
Loans modified in a TDR by class of loan [Abstract]
Number of Contracts | loan
1
0
Pre-Modification Outstanding Recorded Investment
$ 38
$ 0
Post-Modification Outstanding Recorded Investment
$ 38
$ 0
Real Estate Loans Secured by Farmland [Member]
Loans modified in a TDR by class of loan [Abstract]
Number of Contracts | loan
0
1
Pre-Modification Outstanding Recorded Investment
$ 0
$ 7,903
Post-Modification Outstanding Recorded Investment
$ 0
$ 7,903
Real Estate Loans Secured by 1 - 4 Family Residential [Member]
Loans modified in a TDR by class of loan [Abstract]
Number of Contracts | loan
2
0
Pre-Modification Outstanding Recorded Investment
$ 809
$ 0
Post-Modification Outstanding Recorded Investment
$ 806
$ 0
Other Real Estate Loans [Member]
Loans modified in a TDR by class of loan [Abstract]
Number of Contracts | loan
2
4
Pre-Modification Outstanding Recorded Investment
$ 1,240
$ 4,283
Post-Modification Outstanding Recorded Investment
$ 1,240
$ 3,872
Real Estate Loans [Member]
Loans modified in a TDR by class of loan [Abstract]
Number of Contracts | loan
5
5
Pre-Modification Outstanding Recorded Investment
$ 2,087
$ 12,186
Post-Modification Outstanding Recorded Investment
$ 2,084
$ 11,775
Commercial Loans [Member]
Loans modified in a TDR by class of loan [Abstract]
Number of Contracts | loan
0
1
Pre-Modification Outstanding Recorded Investment
$ 0
$ 50
Post-Modification Outstanding Recorded Investment
$ 0
$ 46
Consumer Loans [Member]
Loans modified in a TDR by class of loan [Abstract]
Number of Contracts | loan
0
1
Pre-Modification Outstanding Recorded Investment
$ 0
$ 3,000
Post-Modification Outstanding Recorded Investment
$ 0
$ 3,000
$ in Thousands12 Months Ended
Allowance for loan losses [Roll Forward]
Beginning balance
$ 11,046
$ 11,786
$ 13,320
Adjustment for the sale of majority interest in consolidated subsidiary
(95)
Charge-offs
(2,194)
(3,691)
(4,308)
Recoveries
699
658
909
Provision
1,853
2,293
1,960
Ending balance
11,404
11,046
11,786
Financing Receivable Allowance For Credit Losses Individually And Collectively Evaluated For Impairment [Abstract]
Individually evaluated for impairment
$ 3,838
$ 2,664
$ 2,669
Collectively evaluated for impairment
7,566
8,382
9,117
Total ending allowance balance
11,046
11,786
13,320
11,404
11,046
11,786
Loans:
Individually evaluated for impairment
20,769
20,844
22,158
Collectively evaluated for impairment
839,328
784,837
732,688
Total Loans
860,097
[1]
805,681
[1]
754,846
Real Estate Loans Construction [Member]
Allowance for loan losses [Roll Forward]
Beginning balance
905
550
847
Adjustment for the sale of majority interest in consolidated subsidiary
0
Charge-offs
(388)
0
(1,186)
Recoveries
129
246
258
Provision
293
109
631
Ending balance
939
905
550
Financing Receivable Allowance For Credit Losses Individually And Collectively Evaluated For Impairment [Abstract]
Individually evaluated for impairment
0
53
66
Collectively evaluated for impairment
939
852
484
Total ending allowance balance
905
550
847
939
905
550
Loans:
Individually evaluated for impairment
28
203
246
Collectively evaluated for impairment
35,599
39,470
32,804
Total Loans
35,627
39,673
33,050
Real Estate Loans Secured by Farmland [Member]
Allowance for loan losses [Roll Forward]
Beginning balance
192
179
166
Adjustment for the sale of majority interest in consolidated subsidiary
0
Charge-offs
0
0
0
Recoveries
0
0
0
Provision
(65)
13
13
Ending balance
127
192
179
Financing Receivable Allowance For Credit Losses Individually And Collectively Evaluated For Impairment [Abstract]
Individually evaluated for impairment
0
0
0
Collectively evaluated for impairment
127
192
179
Total ending allowance balance
192
179
166
127
192
179
Loans:
Individually evaluated for impairment
7,972
7,903
7,903
Collectively evaluated for impairment
8,796
11,159
11,805
Total Loans
16,768
19,062
19,708
Real Estate Loans Secured by 1 - 4 Family Residential [Member]
Allowance for loan losses [Roll Forward]
Beginning balance
3,341
3,966
6,734
Adjustment for the sale of majority interest in consolidated subsidiary
(95)
Charge-offs
(1,021)
(344)
(1,380)
Recoveries
395
359
342
Provision
(453)
(640)
(1,635)
Ending balance
2,262
3,341
3,966
Financing Receivable Allowance For Credit Losses Individually And Collectively Evaluated For Impairment [Abstract]
Individually evaluated for impairment
251
1,120
1,370
Collectively evaluated for impairment
2,011
2,221
2,596
Total ending allowance balance
3,341
3,966
6,734
2,262
3,341
3,966
Loans:
Individually evaluated for impairment
1,347
5,127
5,613
Collectively evaluated for impairment
312,698
274,969
259,603
Total Loans
314,045
280,096
265,216
Other Real Estate Loans [Member]
Allowance for loan losses [Roll Forward]
Beginning balance
3,761
3,916
3,506
Adjustment for the sale of majority interest in consolidated subsidiary
0
Charge-offs
(126)
(9)
(747)
Recoveries
32
28
110
Provision
(500)
(174)
1,047
Ending balance
3,167
3,761
3,916
Financing Receivable Allowance For Credit Losses Individually And Collectively Evaluated For Impairment [Abstract]
Individually evaluated for impairment
206
464
294
Collectively evaluated for impairment
2,961
3,297
3,622
Total ending allowance balance
3,761
3,916
3,506
3,167
3,761
3,916
Loans:
Individually evaluated for impairment
4,947
4,196
4,531
Collectively evaluated for impairment
278,666
253,839
250,705
Total Loans
283,613
258,035
255,236
Commercial [Member]
Allowance for loan losses [Roll Forward]
Beginning balance
1,706
2,354
1,890
Adjustment for the sale of majority interest in consolidated subsidiary
0
Charge-offs
(639)
(3,281)
(959)
Recoveries
85
14
104
Provision
2,781
2,619
1,319
Ending balance
3,933
1,706
2,354
Financing Receivable Allowance For Credit Losses Individually And Collectively Evaluated For Impairment [Abstract]
Individually evaluated for impairment
2,539
27
292
Collectively evaluated for impairment
1,394
1,679
2,062
Total ending allowance balance
1,706
2,354
1,890
3,933
1,706
2,354
Loans:
Individually evaluated for impairment
4,604
1,517
846
Collectively evaluated for impairment
186,163
188,965
162,423
Total Loans
190,767
190,482
163,269
Consumer [Member]
Allowance for loan losses [Roll Forward]
Beginning balance
1,141
821
177
Adjustment for the sale of majority interest in consolidated subsidiary
0
Charge-offs
(20)
(57)
(36)
Recoveries
58
11
95
Provision
(203)
366
585
Ending balance
976
1,141
821
Financing Receivable Allowance For Credit Losses Individually And Collectively Evaluated For Impairment [Abstract]
Individually evaluated for impairment
842
1,000
647
Collectively evaluated for impairment
134
141
174
Total ending allowance balance
$ 1,141
$ 821
$ 177
976
1,141
821
Loans:
Individually evaluated for impairment
1,871
1,898
3,019
Collectively evaluated for impairment
17,406
16,435
15,348
Total Loans
$ 19,277
$ 18,333
$ 18,367
[1]
Includes net deferred loan costs and premiums of $3.3 million and $3.5 million, respectively.
$ in Thousands12 Months Ended
Property, Plant and Equipment [Line Items]
Premises and equipment, Gross
$ 38,512
$ 38,048
Less accumulated depreciation
(19,491)
(18,517)
Total
19,021
19,531
Depreciation expense
1,400
1,300
$ 1,500
Future minimum rent commitments under various operating leases [Abstract]
2017
1,666
2018
1,617
2019
1,624
2020
1,444
2021
1,408
Thereafter
13,388
Net Total
21,147
Rent expense
1,800
2,000
$ 2,800
Land [Member]
Property, Plant and Equipment [Line Items]
Premises and equipment, Gross
2,068
2,068
Facilities [Member]
Property, Plant and Equipment [Line Items]
Premises and equipment, Gross
22,873
22,849
Furniture, Fixtures, and Equipment [Member]
Property, Plant and Equipment [Line Items]
Premises and equipment, Gross
11,729
11,676
Construction in Process and Deposits on Equipment and Land [Member]
Property, Plant and Equipment [Line Items]
Premises and equipment, Gross
$ 1,842
$ 1,455
$ in Thousands
Banking and Thrift [Abstract]
Interest bearing product for overnight funding
$ 43,200
$ 34,000
Time deposits of $250,000 or more
84,500
91,000
Scheduled maturities of time deposits [Abstract]
2017
151,293
2018
38,370
2019
25,494
2020
7,115
2021
3,368
Total
225,640
244,575
Overdraft demand deposits reclassified to loans
142
358
Brokered deposits
$ 36,500
$ 38,700
Line of Credit Facility [Line Items]
Remaining credit availability
$ 334,300,000
Letters of credit amount
25,000,000
Long-term debt
39,500,000
Federal Home Loan Bank borrowings
39,500,000
$ 85,000,000
Securities sold under agreements to repurchase, maturing the day following the day sold
34,900,000
$ 26,900,000
Federal Reserve Bank of Richmond [Member]
Line of Credit Facility [Line Items]
Line of credit, maximum credit limit
33,400,000.0
Revolving lines of credit, outstanding balance
0
Other Institutions [Member]
Line of Credit Facility [Line Items]
Line of credit, maximum credit limit
$ 45,000,000
Minimum [Member]
Line of Credit Facility [Line Items]
Federal Home Loan Bank advances, interest rate (in hundredths)
0.63%
Maximum [Member]
Line of Credit Facility [Line Items]
Federal Home Loan Bank advances, interest rate (in hundredths)
0.93%
Weighted Average [Member]
Line of Credit Facility [Line Items]
Federal Home Loan Bank advances, interest rate (in hundredths)
0.78%
0.66%
$ in Thousands
Debt Disclosure [Abstract]
Due in 2017
$ 29,500
Due in 2018
10,000
Total
$ 39,500
$ in Thousands12 Months Ended
Securities sold under agreements to repurchase
Securities sold under agreements to repurchase
$ 34,864
$ 26,869
Weighted-average interest rate at year-end
0.01%
0.01%
Maximum amount outstanding at any month's end
$ 35,660
$ 34,253
Average amount outstanding during the year
$ 31,076
$ 30,095
Weighted-average interest rate during the year
0.01%
0.21%
12 Months Ended
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of plans | share_based_compensation_plan
1
Share based compensation expense | $
$ 925,000
$ 605,000
$ 426,000
Total income tax benefit related to share-based compensation | $
5,000
$ 117,000
$ 63,000
Unrecognized compensation expense related to nonvested stock options awards | $
$ 0
Options granted (in shares)
0
0
0
Aggregate intrinsic value of options exercised | $
$ 88,000
$ 126,500
Exercise of stock options (in shares)
6,650
0
25,501
Aggregate intrinsic value of options outstanding | $
$ 484,800
$ 134,500
$ 120,300
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Service-based award vesting percentage
50.00%
Employee Stock Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period
3 years
Options vesting percentage each on first and second anniversary
25.00%
Options vesting percentage on third anniversary
50.00%
2006 Equity Compensation Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares authorized (in shares)
430,000
2006 Equity Compensation Plan [Member] | Executive Officer [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)
49,100
2006 Equity Compensation Plan [Member] | Performance Based Restricted Stock [Member] | Executive Officer [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)
31,750
2006 Equity Compensation Plan [Member] | Time Based Restricted Stock [Member] | Executive Officer [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)
17,350
2006 Equity Compensation Plan [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)
53,500
36,150
41,533
Restricted stock nonvested outstanding, Weighted average remaining contractual terms
2 years 6 months
2 years 8 months 12 days
3 years 6 months
Unrecognized compensation expense related to nonvested restricted stock awards | $
$ 1,600,000
2006 Equity Compensation Plan [Member] | Restricted Stock [Member] | Director [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)
4,400
Number of directors | director
11
Shares of restricted stock per director
400
Vesting percent (as a percent)
100.00%
$ / shares in Units, $ in Thousands12 Months Ended
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Non-vested at beginning of year (in shares)
153,399
134,108
119,250
Granted (in shares)
53,500
36,150
41,533
Vested (in shares)
(53,908)
(16,359)
(15,425)
Forfeited or expired (in shares)
(2,250)
(500)
(11,250)
Non-vested at end of period (in shares)
150,741
153,399
134,108
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
Non-vested at beginning of year (in dollars per share)
$ 17.17
$ 16.66
$ 16.39
Granted (in dollars per share)
20.76
18.50
17.65
Vested (in dollars per share)
16.88
15.91
15.59
Forfeited or expired (in dollars per share)
19.91
18.07
16.05
Non-vested at end of period (in dollars per share)
$ 18.50
$ 17.17
$ 16.66
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Aggregate Intrinsic Value [Abstract]
Non-vested at end of period
$ 5,238
$ 2,835
$ 2,415
12 Months Ended
Shares [Roll Forward]
Outstanding at beginning of year (in shares)
30,012
30,012
58,513
Granted (in shares)
0
0
0
Exercised (in shares)
(6,650)
0
(25,501)
Forfeited or expired (in shares)
0
0
(3,000)
Outstanding at end of period (in shares)
23,362
30,012
30,012
Options exercisable at year end (in shares)
23,362
30,012
30,012
Weighted Average Exercise Price [Roll Forward]
Outstanding at beginning of year (in dollars per share)
$ 14.00
$ 14.00
$ 15.30
Granted (in dollars per share)
0.00
0.00
0.00
Exercised (in dollars per share)
14.00
0.00
14.00
Forfeited or expired (in dollars per share)
0.00
0.00
39.40
Outstanding at end of period (in dollars per share)
14.00
14.00
14.00
Options exercisable at year end (in dollars per share)
$ 14.00
$ 14.00
$ 14.00
12 Months Ended
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of Exercise Prices (in dollars per share)
$ 14.00
$ 14.00
$ 14.00
$ 15.30
Options Outstanding (in shares)
23,362
30,012
30,012
58,513
Options Exercisable (in shares)
23,362
30,012
30,012
14.00 [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of Exercise Prices (in dollars per share)
$ 14.00
Options Outstanding (in shares)
18,362
Weighted-Average Remaining Contractual Life (years)
2 years 2 months 19 days
Options Exercisable (in shares)
18,362
14.00 [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of Exercise Prices (in dollars per share)
$ 14.00
Options Outstanding (in shares)
5,000
Weighted-Average Remaining Contractual Life (years)
2 years 10 months 6 days
Options Exercisable (in shares)
5,000
14.00 [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of Exercise Prices (in dollars per share)
$ 14.00
Options Outstanding (in shares)
23,362.000
Weighted-Average Remaining Contractual Life (years)
2 years 4 months 9 days
Options Exercisable (in shares)
23,362.000
$ in Thousands12 Months Ended
Defined Benefit Plan Disclosure [Line Items]
Employees contribution, maximum
100.00%
Matching contribution
50.00%
Percentage of employer matching contribution to employees compensation
6.00%
Matching contributions vesting period
5 years
Expense attributable to the plan
$ 364
$ 351
$ 340
$ in Thousands12 Months Ended
Defined Benefit Plan Disclosure [Line Items]
Minimum qualifying age under plan | year
21
Service period
1 year
Minimum number of hours for allocation of an employer contribution
1000 hours
Employer contribution
3.00%
Additional contribution by employer
2.75%
Matching contributions vesting period
5 years
Expense attributable to the plan | $
$ 545
$ 926
$ 898
$ in Thousands12 Months Ended
Defined Benefit Plan Disclosure [Line Items]
Number of deferred compensation plans | plan
2
Basis spread on credit rate
1.50%
Deferred compensation expense | $
$ 245
$ 226
$ 222
Income Tax Disclosure [Abstract]
Valuation allowance
$ 0
$ 0
Deferred tax assets:
Allowance for loan losses
3,877,000
3,756,000
Deferred compensation
687,000
647,000
Interest rate swap
67,000
99,000
Other real estate owned
288,000
257,000
Securities available for sale
654,000
0
Property and equipment
0
49,000
Other
1,427,000
2,028,000
Total deferred tax assets
7,000,000
6,836,000
Deferred tax liabilities:
Deferred loan costs, net
526,000
317,000
Securities available for sale
0
965,000
Property and equipment
79,000
0
Total deferred tax liabilities
605,000
1,282,000
Net deferred tax assets
$ 6,395,000
$ 5,554,000
$ in Thousands12 Months Ended
Income Tax Disclosure [Abstract]
Current tax expense
$ 2,067
$ 2,606
$ 1,160
Deferred tax expense
746
109
1,181
Total income tax expense
$ 2,813
$ 2,715
$ 2,341
$ in Thousands12 Months Ended
Income Tax Disclosure [Abstract]
Computed expected tax expense
$ 3,698
$ 3,585
$ 3,374
Tax-exempt income
(796)
(829)
(959)
Low income housing tax credits
(408)
(120)
(211)
Merger related expenses
267
0
0
Other, net
52
79
137
Total income tax expense
$ 2,813
$ 2,715
$ 2,341
$ in Thousands12 Months Ended
Indebted to subsidiary bank [Roll Forward]
Balance, beginning
$ 1,369
$ 3,804
Decrease due to status changes
0
(2,375)
Principal additions
352
439
Principal payments
(130)
(499)
Balance, ending
1,591
1,369
Unused commitments to extend credit
1,100
2,300
Related party deposit
$ 5,000
$ 5,900
$ in Millions12 Months Ended
Commitments and Contingencies Disclosure [Abstract]
Daily average required reserves
$ 3.5
$ 3.1
12 Months Ended
Shares [Abstract]
Earning (loss) per share, basic (in shares)
7,107,403
7,147,390
7,106,171
Effect of dilutive securities:
Stock options (in shares)
11,461
6,805
6,939
Warrant (in shares)
32,026
13,192
13,491
Earnings per share, diluted (in shares)
7,150,890
7,167,387
7,126,601
Per Share Amount [Abstract]
Earnings per share, basic (in dollars per share)
$ 1.13
$ 1.10
$ 1.07
Earnings per share, diluted (in dollars per share)
$ 1.13
$ 1.09
$ 1.06
3 Months Ended
12 Months Ended
2015 Share Repurchase Plan [Member]
Equity, Class of Treasury Stock [Line Items]
Authorized stock repurchase amount (up to)
$ 10,000,000
Shares repurchased (in shares)
26,800
104,300
Shares repurchased amount
$ 489,000
$ 1,900,000
Average price (in dollars per share)
$ 18.29
$ 18.34
1999 Share Repurchase Plan [Member]
Equity, Class of Treasury Stock [Line Items]
Shares remaining for repurchase (in shares)
24,084
Employee Stock Option [Member]
Equity, Class of Treasury Stock [Line Items]
Anti-dilutive securities
0
0
0
$ in Millions
Equity [Abstract]
Excess of regulatory limitations available for transfer to Parent Company
$ 12.9
$ in Thousands
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]
Deposits in financial institutions in excess of amounts insured by the FDIC
$ 3,400
Commitments to Extend Credit [Member]
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]
Financial instrument contract amount
132,669
$ 153,806
Standby Letters of Credit [Member]
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]
Financial instrument contract amount
$ 4,998
$ 3,718
$ in Thousands
Assets:
U.S. government agencies
$ 73,184
$ 78,940
Obligations of states and political subdivisions
63,373
75,593
Mortgage-backed securities:
Agency
98,051
131,661
Non-agency
9,933
12,777
Other asset backed securities
41,605
58,781
Corporate securities
15,421
16,819
Liabilities:
Interest rate swaps
242
370
Level I [Member]
Assets:
U.S. government agencies
0
0
Obligations of states and political subdivisions
0
0
Mortgage-backed securities:
Agency
0
0
Non-agency
0
0
Other asset backed securities
0
0
Corporate securities
0
0
Liabilities:
Interest rate swaps
0
0
Level II [Member]
Assets:
U.S. government agencies
73,184
78,940
Obligations of states and political subdivisions
63,373
75,593
Mortgage-backed securities:
Agency
98,051
131,661
Non-agency
9,933
12,777
Other asset backed securities
41,605
58,781
Corporate securities
15,421
16,819
Liabilities:
Interest rate swaps
242
370
Level III [Member]
Assets:
U.S. government agencies
0
0
Obligations of states and political subdivisions
0
0
Mortgage-backed securities:
Agency
0
0
Non-agency
0
0
Other asset backed securities
0
0
Corporate securities
0
0
Liabilities:
Interest rate swaps
0
0
Interest Rate Swap [Member]
Mortgage-backed securities:
Interest rate contracts
44
73
Interest Rate Swap [Member] | Level I [Member]
Mortgage-backed securities:
Interest rate contracts
0
0
Interest Rate Swap [Member] | Level II [Member]
Mortgage-backed securities:
Interest rate contracts
44
73
Interest Rate Swap [Member] | Level III [Member]
Mortgage-backed securities:
Interest rate contracts
0
0
Interest Rate Cap [Member]
Mortgage-backed securities:
Interest rate contracts
9
39
Interest Rate Cap [Member] | Level I [Member]
Mortgage-backed securities:
Interest rate contracts
0
Interest Rate Cap [Member] | Level II [Member]
Mortgage-backed securities:
Interest rate contracts
$ 9
39
Interest Rate Cap [Member] | Level III [Member]
Mortgage-backed securities:
Interest rate contracts
$ 0
$ in Thousands
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired loans
$ 6,298
$ 9,018
Other real estate owned
5,073
3,345
Repossessed assets
843
1,043
Level I [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired loans
0
0
Other real estate owned
0
0
Repossessed assets
0
0
Level II [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired loans
0
0
Other real estate owned
0
0
Repossessed assets
0
0
Level III [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired loans
6,298
9,018
Other real estate owned
5,073
3,345
Repossessed assets
$ 843
$ 1,043
$ in Thousands12 Months Ended
Impaired Loans [Member] | Discounted appraised value [Member] | Minimum [Member] | Level III [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Discount rate
0.00%
0.00%
Impaired Loans [Member] | Discounted appraised value [Member] | Maximum [Member] | Level III [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Discount rate
100.00%
100.00%
Impaired Loans [Member] | Discounted appraised value [Member] | Weighted Average [Member] | Level III [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Discount rate
14.00%
17.00%
Impaired Loans [Member] | Present Value of Cash Flows | Minimum [Member] | Level III [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Discount rate
6.00%
6.00%
Impaired Loans [Member] | Present Value of Cash Flows | Maximum [Member] | Level III [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Discount rate
8.00%
8.00%
Impaired Loans [Member] | Present Value of Cash Flows | Weighted Average [Member] | Level III [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Discount rate
7.00%
7.00%
Other Real Estate Owned [Member] | Discounted appraised value [Member] | Weighted Average [Member] | Level III [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Discount rate
10.00%
Other Real Estate Owned [Member] | Market Approach Valuation Technique [Member] | Weighted Average [Member] | Level III [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Discount rate
10.00%
Repossessed Assets [Member] | Discounted appraised value [Member] | Weighted Average [Member] | Level III [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Discount rate
70.00%
Repossessed Assets [Member] | Market Approach Valuation Technique [Member] | Weighted Average [Member] | Level III [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Discount rate
50.00%
Nonrecurring [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Impaired loans
$ 6,298
$ 9,018
Other real estate owned
5,073
3,345
Repossessed assets
843
1,043
Nonrecurring [Member] | Level III [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Impaired loans
6,298
9,018
Other real estate owned
5,073
3,345
Repossessed assets
843
1,043
Nonrecurring [Member] | Discounted appraised value [Member] | Level III [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Impaired loans
1,134
5,434
Nonrecurring [Member] | Present Value of Cash Flows | Level III [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Impaired loans
$ 5,164
$ 3,584
$ in Thousands
Financial assets:
Securities held to maturity
$ 10,095
$ 4,163
Level I [Member]
Financial assets:
Cash and cash equivalents
28,544
39,228
Securities held to maturity
0
0
Securities available for sale
0
0
Loans, net
0
0
Bank owned life insurance
0
0
Accrued interest receivable
0
0
Interest rate contracts
0
Financial liabilities:
Deposits
0
0
Securities sold under agreements to repurchase
0
0
FHLB borrowings
0
0
Subordinated notes
0
0
Accrued interest payable
0
0
Interest rate contracts
0
Level II [Member]
Financial assets:
Cash and cash equivalents
0
0
Securities held to maturity
10,095
4,163
Securities available for sale
301,567
374,571
Loans, net
0
0
Bank owned life insurance
23,925
23,273
Accrued interest receivable
5,093
5,204
Interest rate contracts
73
Financial liabilities:
Deposits
1,051,245
1,040,016
Securities sold under agreements to repurchase
34,864
26,869
FHLB borrowings
39,530
85,033
Subordinated notes
5,159
5,157
Accrued interest payable
387
410
Interest rate contracts
370
Level III [Member]
Financial assets:
Cash and cash equivalents
0
0
Securities held to maturity
0
0
Securities available for sale
0
0
Loans, net
852,280
802,535
Bank owned life insurance
0
0
Accrued interest receivable
0
0
Interest rate contracts
0
Financial liabilities:
Deposits
0
0
Securities sold under agreements to repurchase
0
0
FHLB borrowings
0
0
Subordinated notes
0
0
Accrued interest payable
0
0
Interest rate contracts
0
Carrying Amount [Member]
Financial assets:
Cash and cash equivalents
28,544
39,228
Securities held to maturity
10,683
4,207
Securities available for sale
301,567
374,571
Loans, net
848,693
794,635
Bank owned life insurance
23,925
23,273
Accrued interest receivable
5,093
5,204
Interest rate contracts
73
Financial liabilities:
Deposits
1,053,058
1,040,800
Securities sold under agreements to repurchase
34,864
26,869
FHLB borrowings
39,500
85,000
Subordinated notes
5,155
5,155
Accrued interest payable
387
410
Interest rate contracts
370
Fair Value [Member]
Financial assets:
Cash and cash equivalents
28,544
39,228
Securities held to maturity
10,095
4,163
Securities available for sale
301,567
374,571
Loans, net
852,280
802,535
Bank owned life insurance
23,925
23,273
Accrued interest receivable
5,093
5,204
Interest rate contracts
73
Financial liabilities:
Deposits
1,051,245
1,040,016
Securities sold under agreements to repurchase
34,864
26,869
FHLB borrowings
39,530
85,033
Subordinated notes
5,159
5,157
Accrued interest payable
387
410
Interest rate contracts
370
Interest Rate Swap [Member] | Level I [Member]
Financial assets:
Interest rate contracts
0
Financial liabilities:
Interest rate contracts
0
Interest Rate Swap [Member] | Level II [Member]
Financial assets:
Interest rate contracts
44
Financial liabilities:
Interest rate contracts
242
Interest Rate Swap [Member] | Level III [Member]
Financial assets:
Interest rate contracts
0
Financial liabilities:
Interest rate contracts
0
Interest Rate Swap [Member] | Carrying Amount [Member]
Financial assets:
Interest rate contracts
44
Financial liabilities:
Interest rate contracts
242
Interest Rate Swap [Member] | Fair Value [Member]
Financial assets:
Interest rate contracts
44
Financial liabilities:
Interest rate contracts
242
Interest Rate Cap [Member] | Level I [Member]
Financial assets:
Interest rate contracts
0
0
Interest Rate Cap [Member] | Level II [Member]
Financial assets:
Interest rate contracts
9
39
Interest Rate Cap [Member] | Level III [Member]
Financial assets:
Interest rate contracts
0
0
Interest Rate Cap [Member] | Carrying Amount [Member]
Financial assets:
Interest rate contracts
9
39
Interest Rate Cap [Member] | Fair Value [Member]
Financial assets:
Interest rate contracts
$ 9
$ 39
$ in Thousands
Consolidated [Member]
Total Capital (to Risk- Weighted Assets), Amount [Abstract]
Actual
$ 139,419
$ 132,481
Minimum Capital Requirement
$ 62,436
$ 60,495
Total Capital (to Risk- Weighted Assets), Ratio [Abstract]
Actual, Ratio (in hundredths)
17.90%
17.50%
Minimum Capital Requirement, Ratio (in hundredths)
8.00%
8.00%
Tier 1 Capital (to Risk- Weighted Assets), Amount [Abstract]
Actual
$ 129,642
$ 123,008
Minimum Capital Requirement
$ 46,827
$ 45,371
Tier 1 Capital (to Risk- Weighted Assets), Ratio [Abstract]
Actual, Ratio (in hundredths)
16.60%
16.30%
Minimum Capital Requirement, Ratio (in hundredths)
6.00%
6.00%
Tier 1 Common Equity Capital (to Risk- Weighted Assets), Amount [Abstract]
Actual
$ 124,642
$ 118,008
Minimum Capital Requirement
$ 35,121
$ 34,028
Tier 1 Common Equity Capital (to Risk- Weighted Assets), Ratio [Abstract]
Actual, Ratio (in hundredths)
16.00%
15.60%
Minimum Capital Requirement, Ratio (in hundredths)
4.50%
4.50%
Tier 1 Capital (to Average Assets), Amount [Abstract]
Actual
$ 129,642
$ 123,008
Minimum Capital Requirement
$ 52,142
$ 51,301
Tier 1 Capital (to Average Assets), Ratio [Abstract]
Actual, Ratio (in hundredths)
10.00%
9.60%
Minimum Capital Requirement, Ratio (in hundredths)
4.00%
4.00%
Middleburg Bank [Member]
Total Capital (to Risk- Weighted Assets), Amount [Abstract]
Actual
$ 131,725
$ 127,418
Minimum Capital Requirement
61,994
60,055
Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions
$ 77,492
$ 75,068
Total Capital (to Risk- Weighted Assets), Ratio [Abstract]
Actual, Ratio (in hundredths)
17.00%
17.00%
Minimum Capital Requirement, Ratio (in hundredths)
8.00%
8.00%
Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio (in hundredths)
10.00%
10.00%
Tier 1 Capital (to Risk- Weighted Assets), Amount [Abstract]
Actual
$ 122,016
$ 118,013
Minimum Capital Requirement
46,495
45,041
Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions
$ 61,994
$ 60,055
Tier 1 Capital (to Risk- Weighted Assets), Ratio [Abstract]
Actual, Ratio (in hundredths)
15.80%
15.70%
Minimum Capital Requirement, Ratio (in hundredths)
6.00%
6.00%
Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio (in hundredths)
8.00%
8.00%
Tier 1 Common Equity Capital (to Risk- Weighted Assets), Amount [Abstract]
Actual
$ 122,016
$ 118,013
Minimum Capital Requirement
34,872
33,781
Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions
$ 50,370
$ 48,794
Tier 1 Common Equity Capital (to Risk- Weighted Assets), Ratio [Abstract]
Actual, Ratio (in hundredths)
15.80%
15.70%
Minimum Capital Requirement, Ratio (in hundredths)
4.50%
4.50%
Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio (in hundredths)
6.50%
6.50%
Tier 1 Capital (to Average Assets), Amount [Abstract]
Actual
$ 122,016
$ 118,013
Minimum Capital Requirement
51,909
51,067
Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions
$ 64,886
$ 63,834
Tier 1 Capital (to Average Assets), Ratio [Abstract]
Actual, Ratio (in hundredths)
9.40%
9.20%
Minimum Capital Requirement, Ratio (in hundredths)
4.00%
4.00%
Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio (in hundredths)
5.00%
5.00%
$ in Thousands12 Months Ended
Goodwill and Intangible Assets Disclosure [Abstract]
Identifiable intangible assets, amortization period
15 years
Identifiable intangibles
Gross Carrying Value
$ 3,734
$ 3,734
Accumulated Amortization
3,690
3,519
Unamortizable goodwill
Gross Carrying Value
3,421
3,421
Accumulated Amortization
0
0
Amortization
171
$ 171
$ 171
Estimated amortization expense of identifiable intangibles [Abstract]
2017
44
Estimated amortization expense of identifiable intangibles, total
$ 44
12 Months Ended
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items]
Principal asset of the trust of junior subordinate debt securities
$ 5,200,000
Trust-Preferred Securities [Member]
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items]
Trust-preferred securities issued
$ 5,000,000
Pooled underwriting total
$ 344,000,000
Weighted-average interest rate (as a percent)
3.54%
Mandatory redemption date
Jan. 23, 2034
Percentage Tier 1 capital covered by trust preferred securities, maximum (as a percent)
25.00%
Trust-Preferred Securities [Member] | Minimum [Member]
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items]
Interest rate (as a percent)
3.17%
Trust-Preferred Securities [Member] | Maximum [Member]
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items]
Interest rate (as a percent)
3.74%
$ in Millions1 Months Ended
Business Acquisition [Line Items]
Percentage interest in issued and outstanding membership interest
62.30%
Southern Trust Mortgage [Member]
Business Acquisition [Line Items]
Number of membership units acquired | membership_unit
1
Cost to acquire membership interest | $
$ 1.6
Percentage ownership interest, minimum
50.00%
Percentage interest in issued and outstanding membership interest
62.30%
Ownership interest, percentage sold
100.00%
$ in Thousands
Condensed Balance Sheet Statements, Captions [Line Items]
Cash on deposit with subsidiary bank
$ 6,989
$ 5,489
Investment in subsidiaries
155
155
TOTAL ASSETS
1,272,643
1,294,863
$ 1,222,857
Subordinated notes
5,155
5,155
TOTAL LIABILITIES
1,145,964
1,171,309
Common stock
17,636
17,330
Capital surplus
45,688
44,155
Retained earnings
64,755
60,392
Accumulated other comprehensive income (loss), net
(1,400)
1,677
3,794
$ 232
TOTAL SHAREHOLDERS' EQUITY
126,679
123,554
$ 122,034
$ 115,073
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
1,272,643
1,294,863
Middleburg Financial Corporation [Member]
Condensed Balance Sheet Statements, Captions [Line Items]
Cash on deposit with subsidiary bank
2,154
1,403
Investment in subsidiaries
126,694
125,900
Other assets
3,199
1,686
TOTAL ASSETS
132,047
128,989
Subordinated notes
5,155
5,155
Other liabilities
213
280
TOTAL LIABILITIES
5,368
5,435
Common stock
17,636
17,330
Capital surplus
45,688
44,155
Retained earnings
64,755
60,392
Accumulated other comprehensive income (loss), net
(1,400)
1,677
TOTAL SHAREHOLDERS' EQUITY
126,679
123,554
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
$ 132,047
$ 128,989
$ in Thousands12 Months Ended
INCOME:
Interest and dividends from investments
$ 43,375
$ 42,281
$ 43,325
EXPENSES:
Salaries and employee benefits
18,757
18,435
22,601
Legal and advisory fees
1,202
1,029
1,324
Interest expense
4,424
4,207
5,243
Other
4,190
4,091
4,776
Income before income taxes
10,877
10,545
9,827
Income tax benefit
2,813
2,715
2,341
Net income attributable to Middleburg Financial Corporation
8,064
7,830
7,584
Middleburg Financial Corporation [Member]
INCOME:
Dividends from subsidiaries
6,870
5,383
3,440
Interest and dividends from investments
0
0
15
Other income
2
17
0
Total income
6,872
5,400
3,455
EXPENSES:
Salaries and employee benefits
1,240
919
746
Legal and advisory fees
1,506
164
91
Directors fees
352
274
280
Interest expense
280
279
279
Other
426
416
366
Total expenses
3,804
2,052
1,762
Income before income taxes
3,068
3,348
1,693
Income tax benefit
(1,081)
(715)
(753)
Income before equity in undistributed income of subsidiaries
4,149
4,063
2,446
Equity in undistributed income of subsidiaries
3,915
3,767
5,138
Net income attributable to Middleburg Financial Corporation
$ 8,064
$ 7,830
$ 7,584
$ in Thousands12 Months Ended
Cash Flows from Operating Activities
Net income
$ 8,064
$ 7,830
$ 7,584
Adjustments to reconcile net income to net cash provided by operating activities:
Share-based compensation
925
605
426
(Increase) decrease in other assets
(1,406)
(4,826)
(2,604)
(Decrease) increase in other liabilities
(98)
448
2,447
Net cash provided by operating activities
15,977
12,303
48,789
Cash Flows from Investing Activities
Proceeds from maturity, calls, principal repayments and sales of securities available for sale
155,485
106,154
132,286
Net cash provided by (used in) investing activities
1,373
(93,337)
(44,693)
Cash Flows from Financing Activities
Net proceeds from issuance of common stock
1,742
0
394
Cash dividends paid on common stock
(3,701)
(3,292)
(2,419)
Net cash provided by (used in) provided by financing activities
(28,034)
65,240
(16,417)
Decrease in cash and cash equivalents
(10,684)
(15,794)
(12,321)
Cash and cash equivalents at beginning of year
39,228
55,022
67,343
Cash and cash equivalents at end of year
28,544
39,228
55,022
Middleburg Financial Corporation [Member]
Cash Flows from Operating Activities
Net income
8,064
7,830
7,584
Adjustments to reconcile net income to net cash provided by operating activities:
Equity in undistributed earnings of subsidiaries
(3,915)
(3,767)
(5,138)
Share-based compensation
925
605
426
(Increase) decrease in other assets
(1,469)
957
(1,099)
(Decrease) increase in other liabilities
(67)
13
213
Net cash provided by operating activities
3,538
5,638
1,986
Cash Flows from Investing Activities
Proceeds from maturity, calls, principal repayments and sales of securities available for sale
0
0
44
Net cash provided by (used in) investing activities
0
0
44
Cash Flows from Financing Activities
Net proceeds from issuance of common stock
1,742
0
394
Cash dividends paid on common stock
(3,701)
(3,292)
(2,419)
Repurchases of stock
(828)
(1,506)
(88)
Net cash provided by (used in) provided by financing activities
(2,787)
(4,798)
(2,113)
Decrease in cash and cash equivalents
751
840
(83)
Cash and cash equivalents at beginning of year
1,403
563
646
Cash and cash equivalents at end of year
$ 2,154
$ 1,403
$ 563
$ in Thousands12 Months Ended
Revenues:
Interest income
$ 43,375
$ 42,281
$ 43,325
Trust services income
4,643
4,785
4,362
Other income
6,095
5,605
10,424
Total operating income
54,113
52,671
58,111
Expenses:
Interest expense
4,424
4,207
5,243
Salaries and employee benefits
18,757
18,435
22,601
Provision for loan losses
1,853
2,293
1,960
Other expense
18,202
17,191
18,480
Total operating expenses
43,236
42,126
48,284
Income before income taxes
10,877
10,545
9,827
Income tax expense
2,813
2,715
2,341
NET INCOME
8,064
7,830
7,486
Non-controlling interest in consolidated subsidiary
0
0
98
Net income attributable to Middleburg Financial Corporation
8,064
7,830
7,584
Total assets
1,272,643
1,294,863
1,222,857
Capital expenditures
978
2,137
920
Goodwill and other intangibles
3,465
3,636
3,807
Operating Segments [Member] | Commercial & Retail Banking [Member]
Revenues:
Interest income
43,365
42,270
43,149
Trust services income
0
0
0
Other income
6,204
5,605
5,349
Total operating income
49,569
47,875
48,498
Expenses:
Interest expense
4,424
4,207
5,227
Salaries and employee benefits
16,473
16,130
16,567
Provision for loan losses
1,853
2,293
1,926
Other expense
17,556
16,237
15,818
Total operating expenses
40,306
38,867
39,538
Income before income taxes
9,263
9,008
8,960
Income tax expense
2,203
2,131
1,894
NET INCOME
7,060
7,066
Non-controlling interest in consolidated subsidiary
0
Net income attributable to Middleburg Financial Corporation
6,877
7,066
Total assets
1,270,222
1,291,708
1,218,452
Capital expenditures
978
2,137
911
Goodwill and other intangibles
0
0
0
Operating Segments [Member] | Wealth Management [Member]
Revenues:
Interest income
10
11
14
Trust services income
4,806
4,951
4,516
Other income
0
0
0
Total operating income
4,816
4,962
4,530
Expenses:
Interest expense
0
0
0
Salaries and employee benefits
2,284
2,305
2,262
Provision for loan losses
0
0
0
Other expense
918
1,120
1,140
Total operating expenses
3,202
3,425
3,402
Income before income taxes
1,614
1,537
1,128
Income tax expense
610
584
447
NET INCOME
1,004
681
Non-controlling interest in consolidated subsidiary
0
Net income attributable to Middleburg Financial Corporation
953
681
Total assets
6,693
6,700
7,152
Capital expenditures
0
0
6
Goodwill and other intangibles
3,465
3,636
3,807
Operating Segments [Member] | Mortgage Banking [Member]
Revenues:
Interest income
0
0
450
Trust services income
0
0
0
Other income
0
0
5,121
Total operating income
0
0
5,571
Expenses:
Interest expense
0
0
304
Salaries and employee benefits
0
0
3,772
Provision for loan losses
0
0
34
Other expense
0
0
1,722
Total operating expenses
0
0
5,832
Income before income taxes
0
0
(261)
Income tax expense
0
0
0
NET INCOME
0
(261)
Non-controlling interest in consolidated subsidiary
98
Net income attributable to Middleburg Financial Corporation
0
(163)
Total assets
0
0
0
Capital expenditures
0
0
3
Goodwill and other intangibles
0
0
0
Intercompany Eliminations [Member]
Revenues:
Interest income
0
0
(288)
Trust services income
(163)
(166)
(154)
Other income
(109)
0
(46)
Total operating income
(272)
(166)
(488)
Expenses:
Interest expense
0
0
(288)
Salaries and employee benefits
0
0
0
Provision for loan losses
0
0
0
Other expense
(272)
(166)
(200)
Total operating expenses
(272)
(166)
(488)
Income before income taxes
0
0
0
Income tax expense
0
0
0
NET INCOME
0
0
Non-controlling interest in consolidated subsidiary
0
Net income attributable to Middleburg Financial Corporation
0
0
Total assets
(4,272)
(3,545)
(2,747)
Capital expenditures
0
0
0
Goodwill and other intangibles
$ 0
$ 0
$ 0
$ / shares in Units, $ in Thousands
12 Months Ended
Equity, Class of Treasury Stock [Line Items]
Warrants issued under capital repurchase program (in shares)
208,202
104,101
Common stock, par value (in dollars per share)
$ 2.50
$ 2.50
$ 2.50
Exercise price of warrants (in dollars per share)
$ 15.85
Proceeds from warrant exercises
$ 1,650
Series A Cumulative Perpetual Preferred Stock [Member]
Equity, Class of Treasury Stock [Line Items]
Preferred stock issued under capital repurchase program (in shares)
22,000
Preferred stock, par value (in dollars per share)
$ 2.50
Liquidation preference per share (in dollars per shares)
$ 1,000
Shares redeemed during period (in shares)
22,000
12 Months Ended
Derivative [Line Items]
Notional Amount
$ 10,342,000
$ 10,932,000
Operating Expense [Member] | Hedging Instrument [Member]
Derivative [Line Items]
Loss on cash flow hedge ineffectiveness
0
0
$ 6,000
Cash Flow Hedging [Member] | Hedging Instrument [Member]
Derivative [Line Items]
Term
5 years
Collateral reserved for swap
$ 600,000
$ 300,000
Interest Rate Swap One [Member] | Hedging Instrument [Member]
Derivative [Line Items]
Fixed rate payment
2.59%
2.59%
2.59%
Notional Amount
$ 5,155,000
$ 5,155,000
$ 5,200,000
Term
10 years
Number of positions | position
1
1
Interest Rate Swap One [Member] | Cash Flow Hedging [Member] | Hedging Instrument [Member]
Derivative [Line Items]
Collateral reserved for swap
$ 400,000
$ 400,000
Interest Rate Swap 2 [Member] | Cash Flow Hedging [Member] | Hedging Instrument [Member]
Derivative [Line Items]
Fixed rate payment
1.43%
Notional Amount
$ 10,000,000
Interest Rate Swap [Member] | Hedging Instrument [Member]
Derivative [Line Items]
Amounts included in accumulated other comprehensive income as unrealized losses
$ 130,000
$ 195,000
Interest Rate Swap [Member] | Not Designated as Hedging Instrument [Member]
Derivative [Line Items]
Number of positions | position
0
0
Interest Rate Cap [Member]
Derivative [Line Items]
Notional Amount
$ 10,000,000
$ 10,000,000
Interest Rate Cap [Member] | Not Designated as Hedging Instrument [Member]
Derivative [Line Items]
Premium Paid
$ 70,000
$ 70,000
3-Month LIBOR Strike Rate
2.00%
2.00%
Interest Rate Cap [Member] | Other Operating Income (Expense) [Member] | Not Designated as Hedging Instrument [Member]
Derivative [Line Items]
Change in fair value of derivative asset
$ 30,000
$ 31,000
Other Assets [Member] | Interest Rate Cap [Member] | Not Designated as Hedging Instrument [Member]
Derivative [Line Items]
Fair value of derivative asset
$ 9,000
$ 39,000
$ in Thousands12 Months Ended
Derivative [Line Items]
Notional Amount
$ 10,342
$ 10,932
Life (Years)
Interest Rate Swap One [Member] | Hedging Instrument [Member]
Derivative [Line Items]
Number of positions | position
1
1
Notional Amount
$ 5,155
$ 5,155
$ 5,200
Asset
0
0
Liability
$ 160
$ 226
Receive Rate (as a percent)
0.87%
0.32%
Pay Rate (as a percent)
2.59%
2.59%
2.59%
Life (Years)
3 years 9 months 18 days
4 years 9 months 18 days
Interest Rate Swap Two [Member] | Hedging Instrument [Member]
Derivative [Line Items]
Number of positions | position
1
1
Notional Amount
$ 10,000
$ 10,000
Asset
0
0
Liability
$ 38
$ 71
Receive Rate (as a percent)
0.60%
0.23%
Pay Rate (as a percent)
1.43%
1.43%
Life (Years)
2 years
3 years
$ in Thousands12 Months Ended
Derivative [Line Items]
Notional Amount
$ 10,342
$ 10,932
Asset
44
73
Liability
$ 44
$ 73
Life (Years)
Interest Rate Swap at 3.90% Pay Rate [Member]
Derivative [Line Items]
Number of positions | position
1
1
Notional Amount
$ 3,508
$ 3,760
Asset
15
0
Liability
$ 0
$ 21
Pay Rate
3.90%
3.90%
Life (Years)
10 years 10 months 24 days
11 years 10 months 24 days
Interest Rate Swap at 4.09% Pay Rate [Member]
Derivative [Line Items]
Number of positions | position
1
1
Notional Amount
$ 1,663
$ 1,706
Asset
0
0
Liability
$ 29
$ 52
Pay Rate
4.09%
4.09%
Life (Years)
7 years 10 months 24 days
8 years 10 months 24 days
Reverse Interest Rate Swap at 3.90% Pay Rate [Member]
Derivative [Line Items]
Number of positions | position
1
1
Notional Amount
$ 3,508
$ 3,760
Asset
0
21
Liability
$ 15
$ 0
Pay Rate
3.90%
3.90%
Life (Years)
10 years 10 months 24 days
11 years 10 months 24 days
Reverse Interest Rate Swap at 4.09% Pay Rate [Member]
Derivative [Line Items]
Number of positions | position
1
1
Notional Amount
$ 1,663
$ 1,706
Asset
$ 29
52
Liability
$ 0
Pay Rate
4.09%
4.09%
Life (Years)
7 years 10 months 24 days
8 years 10 months 24 days
London Interbank Offered Rate (LIBOR) [Member] | Interest Rate Swap at 3.90% Pay Rate [Member]
Derivative [Line Items]
Spread on variable rate (as a percent)
2.00%
2.00%
London Interbank Offered Rate (LIBOR) [Member] | Interest Rate Swap at 4.09% Pay Rate [Member]
Derivative [Line Items]
Spread on variable rate (as a percent)
1.80%
1.80%
London Interbank Offered Rate (LIBOR) [Member] | Reverse Interest Rate Swap at 3.90% Pay Rate [Member]
Derivative [Line Items]
Spread on variable rate (as a percent)
2.00%
2.00%
London Interbank Offered Rate (LIBOR) [Member] | Reverse Interest Rate Swap at 4.09% Pay Rate [Member]
Derivative [Line Items]
Spread on variable rate (as a percent)
1.80%
1.80%
$ in Thousands12 Months Ended
Derivative [Line Items]
Notional Amount
$ 10,342
$ 10,932
Interest Rate Cap [Member]
Derivative [Line Items]
Notional Amount
$ 10,000
$ 10,000
Not Designated as Hedging Instrument [Member] | Interest Rate Cap [Member]
Derivative [Line Items]
3-Month LIBOR Strike Rate
2.00%
2.00%
Premium Paid
$ 70
$ 70
Unamortized premium
70
70
Other Assets [Member] | Not Designated as Hedging Instrument [Member] | Interest Rate Cap [Member]
Derivative [Line Items]
Fair value of derivative asset
9
39
Cumulative Cash Flows Received
$ 0
$ 0
$ in Thousands12 Months Ended
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Balance beginning of period
$ 1,677
$ 3,794
$ 232
Unrealized holding gains (net of tax, $1,979, $1,037, and 1,091 for 2014, 2015 and 2016, respectively)
(2,116)
(2,015)
3,841
Reclassification adjustment (net of tax, $63, $48, and $528 for 2014, 2015 and 2016, respectively)
(1,026)
(92)
(123)
Unrealized gain on interest rate swaps (net of tax, $82, $3, and ($34) for 2014, 2015 and 2016, respectively)
65
(6)
(160)
Reclassification adjustment, net of tax of $0, $2 and $2, for 2014, 2015 and 2016, respectively
0
(4)
4
Balance end of period
(1,400)
1,677
3,794
Other Comprehensive Income (Loss), Tax, Portion Attributable to Parent, Parenthetical Disclosures [Abstract]
Unrealized holding gains arising during the period, tax
1,091
1,037
(1,979)
Reclassification adjustment for investment securities, taxes
528
48
63
Unrealized gain (loss) on interest rate swap, tax
(34)
3
82
Reclassification adjustment for (gain) loss on interest rate swap ineffectiveness, tax
0
2
(2)
Unrealized Gains (Losses) on Securities [Member]
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Balance beginning of period
1,872
3,979
261
Unrealized holding gains (net of tax, $1,979, $1,037, and 1,091 for 2014, 2015 and 2016, respectively)
(2,116)
(2,015)
3,841
Reclassification adjustment (net of tax, $63, $48, and $528 for 2014, 2015 and 2016, respectively)
(1,026)
(92)
(123)
Unrealized gain on interest rate swaps (net of tax, $82, $3, and ($34) for 2014, 2015 and 2016, respectively)
0
0
0
Reclassification adjustment, net of tax of $0, $2 and $2, for 2014, 2015 and 2016, respectively
0
0
Balance end of period
(1,270)
1,872
3,979
Derivatives [Member]
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Balance beginning of period
(195)
(185)
(29)
Unrealized holding gains (net of tax, $1,979, $1,037, and 1,091 for 2014, 2015 and 2016, respectively)
0
0
0
Reclassification adjustment (net of tax, $63, $48, and $528 for 2014, 2015 and 2016, respectively)
0
0
0
Unrealized gain on interest rate swaps (net of tax, $82, $3, and ($34) for 2014, 2015 and 2016, respectively)
65
(6)
(160)
Reclassification adjustment, net of tax of $0, $2 and $2, for 2014, 2015 and 2016, respectively
(4)
4
Balance end of period
$ (130)
$ (195)
$ (185)
$ in Thousands12 Months Ended
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Gains on sales of securities available for sale, net
$ (1,554)
$ (140)
$ (186)
Income tax expense
2,813
2,715
2,341
Net income
8,064
7,830
7,486
Reclassification out of Accumulated Other Comprehensive Income [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Net income
(1,026)
(96)
(119)
Reclassification out of Accumulated Other Comprehensive Income [Member] | Unrealized Gains (Losses) on Securities [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Gains on sales of securities available for sale, net
[1]
(1,554)
(140)
(186)
Income tax expense
[1]
528
48
63
Net income
(1,026)
(96)
(119)
Reclassification out of Accumulated Other Comprehensive Income [Member] | Derivatives [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Income tax expense
[2]
0
2
(2)
Other operating expense
[2]
$ 0
$ (6)
$ 6
[1]
For more information related to unrealized gains on securities available for sale, see Note 2, "Securities".
[2]
For more information related to unrealized losses on derivatives, see Note 24, "Derivatives".
$ in Thousands12 Months Ended
Banking and Thrift [Abstract]
Repossessed assets
$ 5,073
$ 3,345
$ 4,051
Expenses applicable to OREO
$ 363
$ 284
$ 256
Number of loans secured by residential real estate | loan
0
1
Amount of loan secured by residential real estate
$ 533
$ in Thousands12 Months Ended
Other Real Estate [Roll Forward]
Balance at the beginning of year, net
$ 3,345
$ 4,051
Transfers from loans, net
2,645
287
Purchased loans
40
0
Sales proceeds
(713)
(814)
Gain (loss) on disposition
66
(100)
Less valuation adjustments
(310)
(79)
Balance at the end of year, net
$ 5,073
$ 3,345
$ in Thousands
Accounts, Notes, Loans and Financing Receivable [Line Items]
Repossessed assets
$ 5,073
$ 3,345
$ 4,051
Construction Loans [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Repossessed assets
946
853
Real Estate Loans Secured by 1 - 4 Family Residential [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Repossessed assets
3,767
1,958
Other Real Estate Loans [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Repossessed assets
$ 360
$ 534
$ in Thousands12 Months Ended
Schedule of Equity Method Investments [Line Items]
Number of housing equity funds | housing_equity_fund
4
4
Tax credits and other tax benefits
$ 408
$ 120
$ 211
Tax credits projected to be received
441
Other Assets [Member]
Schedule of Equity Method Investments [Line Items]
Investments in housing equity funds
8,400
9,000
Other Liabilities [Member]
Schedule of Equity Method Investments [Line Items]
Additional capital calls expected
$ 8,200
$ 9,300
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