þ | Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
¨ | Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
Wisconsin | 39-1576570 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
401 Charmany Drive, Madison, WI | 53719 | |
(Address of Principal Executive Offices) | (Zip Code) |
Large accelerated filer ¨ | Accelerated filer þ | Non-accelerated filer ¨ | Smaller reporting company ¨ | Emerging growth company ¨ | ||||
(Do not check if a smaller reporting company) |
September 30, 2017 | December 31, 2016 | |||||||
(unaudited) | ||||||||
(In Thousands, Except Share Data) | ||||||||
Assets | ||||||||
Cash and due from banks | $ | 20,685 | $ | 14,596 | ||||
Short-term investments | 52,511 | 62,921 | ||||||
Cash and cash equivalents | 73,196 | 77,517 | ||||||
Securities available-for-sale, at fair value | 131,130 | 145,893 | ||||||
Securities held-to-maturity, at amortized cost | 38,873 | 38,612 | ||||||
Loans held for sale | — | 1,111 | ||||||
Loans and leases receivable, net of allowance for loan and lease losses of $19,923 and $20,912, respectively | 1,446,790 | 1,429,763 | ||||||
Premises and equipment, net | 3,048 | 3,772 | ||||||
Foreclosed properties | 2,585 | 1,472 | ||||||
Bank-owned life insurance | 39,988 | 39,048 | ||||||
Federal Home Loan Bank and Federal Reserve Bank stock, at cost | 5,083 | 2,131 | ||||||
Goodwill and other intangible assets | 12,735 | 12,773 | ||||||
Accrued interest receivable and other assets | 32,228 | 28,607 | ||||||
Total assets | $ | 1,785,656 | $ | 1,780,699 | ||||
Liabilities and Stockholders’ Equity | ||||||||
Deposits | $ | 1,423,724 | $ | 1,538,855 | ||||
Federal Home Loan Bank advances and other borrowings | 167,884 | 59,676 | ||||||
Junior subordinated notes | 10,015 | 10,004 | ||||||
Accrued interest payable and other liabilities | 17,252 | 10,514 | ||||||
Total liabilities | 1,618,875 | 1,619,049 | ||||||
Stockholders’ equity: | ||||||||
Preferred stock, $0.01 par value, 2,500,000 shares authorized, none issued or outstanding | — | — | ||||||
Common stock, $0.01 par value, 25,000,000 shares authorized, 9,016,345 and 8,959,239 shares issued, 8,758,923 and 8,715,856 shares outstanding at September 30, 2017 and December 31, 2016, respectively | 90 | 90 | ||||||
Additional paid-in capital | 78,353 | 77,542 | ||||||
Retained earnings | 95,785 | 91,317 | ||||||
Accumulated other comprehensive loss | (370 | ) | (522 | ) | ||||
Treasury stock, 257,422 and 243,383 shares at September 30, 2017 and December 31, 2016, respectively, at cost | (7,077 | ) | (6,777 | ) | ||||
Total stockholders’ equity | 166,781 | 161,650 | ||||||
Total liabilities and stockholders’ equity | $ | 1,785,656 | $ | 1,780,699 |
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
(In Thousands, Except Per Share Data) | ||||||||||||||||
Interest income | ||||||||||||||||
Loans and leases | $ | 17,686 | $ | 18,016 | $ | 53,492 | $ | 55,161 | ||||||||
Securities | 771 | 698 | 2,326 | 2,102 | ||||||||||||
Short-term investments | 177 | 184 | 488 | 533 | ||||||||||||
Total interest income | 18,634 | 18,898 | 56,306 | 57,796 | ||||||||||||
Interest expense | ||||||||||||||||
Deposits | 2,708 | 2,870 | 8,039 | 8,961 | ||||||||||||
Federal Home Loan Bank advances and other borrowings | 763 | 453 | 2,185 | 1,425 | ||||||||||||
Junior subordinated notes | 280 | 280 | 832 | 835 | ||||||||||||
Total interest expense | 3,751 | 3,603 | 11,056 | 11,221 | ||||||||||||
Net interest income | 14,883 | 15,295 | 45,250 | 46,575 | ||||||||||||
Provision for loan and lease losses | 1,471 | 3,537 | 5,699 | 6,824 | ||||||||||||
Net interest income after provision for loan and lease losses | 13,412 | 11,758 | 39,551 | 39,751 | ||||||||||||
Non-interest income | ||||||||||||||||
Trust and investment services fee income | 1,653 | 1,364 | 4,930 | 3,981 | ||||||||||||
Gain on sale of Small Business Administration loans | 606 | 347 | 1,501 | 3,854 | ||||||||||||
Gain on sale of residential mortgage loans | — | 198 | 26 | 540 | ||||||||||||
Service charges on deposits | 756 | 772 | 2,287 | 2,247 | ||||||||||||
Loan fees | 391 | 506 | 1,525 | 1,791 | ||||||||||||
Increase in cash surrender value of bank-owned life insurance | 314 | 244 | 940 | 730 | ||||||||||||
Other non-interest income | 619 | 209 | 1,931 | 914 | ||||||||||||
Total non-interest income | 4,339 | 3,640 | 13,140 | 14,057 | ||||||||||||
Non-interest expense | ||||||||||||||||
Compensation | 7,645 | 7,637 | 24,710 | 24,454 | ||||||||||||
Occupancy | 527 | 530 | 1,521 | 1,538 | ||||||||||||
Professional fees | 995 | 1,065 | 3,046 | 2,888 | ||||||||||||
Data processing | 592 | 623 | 1,810 | 1,971 | ||||||||||||
Marketing | 594 | 528 | 1,546 | 1,710 | ||||||||||||
Equipment | 285 | 292 | 868 | 913 | ||||||||||||
Computer software | 715 | 539 | 2,037 | 1,607 | ||||||||||||
FDIC insurance | 320 | 444 | 1,081 | 989 | ||||||||||||
Collateral liquidation costs | 371 | 89 | 556 | 204 | ||||||||||||
Net loss on foreclosed properties | — | — | — | 93 | ||||||||||||
Impairment of tax credit investments | 112 | 3,314 | 338 | 3,520 | ||||||||||||
Small Business Administration recourse provision | 1,315 | 375 | 2,095 | 449 | ||||||||||||
Other non-interest expense | 760 | 317 | 2,404 | 1,574 | ||||||||||||
Total non-interest expense | 14,231 | 15,753 | 42,012 | 41,910 | ||||||||||||
Income (loss) before income tax expense | 3,520 | (355 | ) | 10,679 | 11,898 | |||||||||||
Income tax expense (benefit) | 936 | (3,020 | ) | 2,812 | 957 | |||||||||||
Net income | $ | 2,584 | $ | 2,665 | $ | 7,867 | $ | 10,941 | ||||||||
Earnings per common share | ||||||||||||||||
Basic | $ | 0.30 | $ | 0.31 | $ | 0.90 | $ | 1.26 | ||||||||
Diluted | 0.30 | 0.31 | 0.90 | 1.26 | ||||||||||||
Dividends declared per share | 0.13 | 0.12 | 0.39 | 0.36 |
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
(In Thousands) | ||||||||||||||||
Net income | $ | 2,584 | $ | 2,665 | $ | 7,867 | $ | 10,941 | ||||||||
Other comprehensive income, before tax | ||||||||||||||||
Securities available-for-sale: | ||||||||||||||||
Net unrealized securities gains arising during the period | 172 | 81 | 199 | 1,317 | ||||||||||||
Securities held-to-maturity: | ||||||||||||||||
Amortization of net unrealized losses transferred from available-for-sale | 25 | 41 | 79 | 124 | ||||||||||||
Income tax expense | (76 | ) | (47 | ) | (126 | ) | (555 | ) | ||||||||
Total other comprehensive income | 121 | 75 | 152 | 886 | ||||||||||||
Comprehensive income | $ | 2,705 | $ | 2,740 | $ | 8,019 | $ | 11,827 |
Common Shares Outstanding | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive (Loss) Income | Treasury Stock | Total | |||||||||||||||||||||
(In Thousands, Except Share Data) | |||||||||||||||||||||||||||
Balance at December 31, 2015 | 8,699,410 | $ | 89 | $ | 76,549 | $ | 80,584 | $ | (80 | ) | $ | (6,310 | ) | $ | 150,832 | ||||||||||||
Net income | — | — | — | 10,941 | — | — | 10,941 | ||||||||||||||||||||
Other comprehensive income | — | — | — | — | 886 | — | 886 | ||||||||||||||||||||
Share-based compensation - restricted shares, net | 37,708 | 1 | 857 | — | — | — | 858 | ||||||||||||||||||||
Cash dividends ($0.36 per share) | — | — | — | (3,132 | ) | — | — | (3,132 | ) | ||||||||||||||||||
Treasury stock purchased | (19,819 | ) | — | — | — | — | (454 | ) | (454 | ) | |||||||||||||||||
Balance at September 30, 2016 | 8,717,299 | $ | 90 | $ | 77,406 | $ | 88,393 | $ | 806 | $ | (6,764 | ) | $ | 159,931 |
Common Shares Outstanding | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive (Loss) Income | Treasury Stock | Total | |||||||||||||||||||||
(In Thousands, Except Share Data) | |||||||||||||||||||||||||||
Balance at December 31, 2016 | 8,715,856 | $ | 90 | $ | 77,542 | $ | 91,317 | $ | (522 | ) | $ | (6,777 | ) | $ | 161,650 | ||||||||||||
Net income | — | — | — | 7,867 | — | — | 7,867 | ||||||||||||||||||||
Other comprehensive income | — | — | — | — | 152 | — | 152 | ||||||||||||||||||||
Share-based compensation - restricted shares, net | 57,106 | — | 811 | — | — | — | 811 | ||||||||||||||||||||
Cash dividends ($0.39 per share) | — | — | — | (3,399 | ) | — | — | (3,399 | ) | ||||||||||||||||||
Treasury stock purchased | (14,039 | ) | — | — | — | — | (300 | ) | (300 | ) | |||||||||||||||||
Balance at September 30, 2017 | 8,758,923 | $ | 90 | $ | 78,353 | $ | 95,785 | $ | (370 | ) | $ | (7,077 | ) | $ | 166,781 |
For the Nine Months Ended September 30, | ||||||||
2017 | 2016 | |||||||
(In Thousands) | ||||||||
Operating activities | ||||||||
Net income | $ | 7,867 | $ | 10,941 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Deferred income taxes, net | (1,603 | ) | (9 | ) | ||||
Impairment of tax credit investments | 338 | 3,520 | ||||||
Provision for loan and lease losses | 5,699 | 6,824 | ||||||
Depreciation, amortization and accretion, net | 1,148 | 1,103 | ||||||
Share-based compensation | 811 | 858 | ||||||
Increase in value of bank-owned life insurance policies | (940 | ) | (730 | ) | ||||
Origination of loans for sale | (24,606 | ) | (54,794 | ) | ||||
Sale of loans originated for sale | 27,244 | 59,263 | ||||||
Gain on sale of loans originated for sale | (1,527 | ) | (4,394 | ) | ||||
Net loss on foreclosed properties, including impairment valuation | — | 93 | ||||||
Excess tax benefit from share-based compensation | (59 | ) | (138 | ) | ||||
Returns on investments in limited partnerships | 92 | 250 | ||||||
Net increase in accrued interest receivable and other assets | (1,759 | ) | (2,813 | ) | ||||
Net (decrease) increase in accrued interest payable and other liabilities | 6,739 | (2,789 | ) | |||||
Net cash provided by operating activities | 19,444 | 17,185 | ||||||
Investing activities | ||||||||
Proceeds from maturities, redemptions and paydowns of available-for-sale securities | 29,802 | 32,555 | ||||||
Proceeds from maturities, redemptions and paydowns of held-to-maturity securities | 2,723 | 2,906 | ||||||
Proceeds from sale of available-for-sale securities | 11,702 | 2,190 | ||||||
Purchases of available-for-sale securities | (27,125 | ) | (48,229 | ) | ||||
Purchases of held-to-maturity securities | (3,016 | ) | (714 | ) | ||||
Proceeds from sale of foreclosed properties | — | 57 | ||||||
Net increase in loans and leases | (22,530 | ) | (29,962 | ) | ||||
Investments in limited partnerships | (500 | ) | (750 | ) | ||||
Returns of investments in limited partnerships | — | 541 | ||||||
Investment in historic development entities | (417 | ) | (1,488 | ) | ||||
Investment in Federal Home Loan Bank and Federal Reserve Bank Stock | (12,223 | ) | (388 | ) | ||||
Proceeds from the sale of Federal Home Loan Bank Stock | 9,271 | 1,066 | ||||||
Purchases of leasehold improvements and equipment, net | (942 | ) | (519 | ) | ||||
Net cash used in investing activities | (13,255 | ) | (42,735 | ) | ||||
Financing activities | ||||||||
Net decrease in deposits | (115,107 | ) | (10,924 | ) | ||||
Repayment of Federal Home Loan Bank advances | (470,416 | ) | (63,100 | ) | ||||
Proceeds from Federal Home Loan Bank advances | 580,415 | 59,600 | ||||||
Proceeds from issuance of subordinated notes payable | 9,090 | — | ||||||
Repayment of subordinated notes payable | (7,889 | ) | — | |||||
Net decrease in other borrowed funds | (2,904 | ) | (1,240 | ) | ||||
Cash dividends paid | (3,399 | ) | (3,132 | ) | ||||
Purchase of treasury stock | (300 | ) | (454 | ) | ||||
Net cash used in financing activities | (10,510 | ) | (19,250 | ) | ||||
Net decrease in cash and cash equivalents | (4,321 | ) | (44,800 | ) | ||||
Cash and cash equivalents at the beginning of the period | 77,517 | 113,564 | ||||||
Cash and cash equivalents at the end of the period | $ | 73,196 | $ | 68,764 | ||||
Supplementary cash flow information | ||||||||
Cash paid during the period for: | ||||||||
Interest paid on deposits and borrowings | $ | 10,504 | $ | 11,058 | ||||
Income taxes paid | 490 | 5,122 | ||||||
Non-cash investing and financing activities: | ||||||||
Transfer of loans from held-to-maturity to held-for-sale | 8,366 | 11,504 | ||||||
Transfer from premises and equipment to foreclosed properties | 1,113 | — |
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
(Dollars in Thousands, Except Share Data) | ||||||||||||||||
Basic earnings per common share | ||||||||||||||||
Net income | $ | 2,584 | $ | 2,665 | $ | 7,867 | $ | 10,941 | ||||||||
Less: earnings allocated to participating securities | 35 | 38 | 105 | 165 | ||||||||||||
Basic earnings allocated to common shareholders | $ | 2,549 | $ | 2,627 | $ | 7,762 | $ | 10,776 | ||||||||
Weighted-average common shares outstanding, excluding participating securities | 8,621,311 | 8,582,836 | 8,606,080 | 8,569,613 | ||||||||||||
Basic earnings per common share | $ | 0.30 | $ | 0.31 | $ | 0.90 | $ | 1.26 | ||||||||
Diluted earnings per common share | ||||||||||||||||
Earnings allocated to common shareholders, diluted | $ | 2,549 | $ | 2,627 | $ | 7,762 | $ | 10,776 | ||||||||
Weighted-average diluted common shares outstanding, excluding participating securities | 8,621,311 | 8,582,836 | 8,606,080 | 8,569,613 | ||||||||||||
Diluted earnings per common share | $ | 0.30 | $ | 0.31 | $ | 0.90 | $ | 1.26 |
Number of Restricted Shares/Units | Weighted Average Grant-Date Fair Value | ||||||
Nonvested balance as of December 31, 2015 | 135,471 | $ | 20.13 | ||||
Granted | 60,415 | 22.74 | |||||
Vested | (56,090 | ) | 18.71 | ||||
Forfeited | (23,551 | ) | 20.90 | ||||
Nonvested balance as of December 31, 2016 | 116,245 | 21.13 | |||||
Granted | 64,725 | 21.62 | |||||
Vested | (45,695 | ) | 21.49 | ||||
Forfeited | (7,619 | ) | 21.57 | ||||
Nonvested balance as of September 30, 2017 | 127,656 | $ | 21.39 |
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
(In Thousands) | |||||||||||||||
Share-based compensation expense | $ | 268 | $ | 292 | $ | 811 | $ | 858 |
As of September 30, 2017 | ||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||
(In Thousands) | ||||||||||||||||
Available-for-sale: | ||||||||||||||||
U.S. Government agency obligations - government-sponsored enterprises | $ | 3,799 | $ | 11 | $ | (3 | ) | $ | 3,807 | |||||||
Municipal obligations | 9,342 | 13 | (23 | ) | 9,332 | |||||||||||
Collateralized mortgage obligations - government issued | 22,750 | 301 | (149 | ) | 22,902 | |||||||||||
Collateralized mortgage obligations - government-sponsored enterprises | 95,608 | 165 | (684 | ) | 95,089 | |||||||||||
$ | 131,499 | $ | 490 | $ | (859 | ) | $ | 131,130 |
As of December 31, 2016 | ||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||
(In Thousands) | ||||||||||||||||
Available-for-sale: | ||||||||||||||||
U.S. Government agency obligations - government-sponsored enterprises | $ | 6,298 | $ | 7 | $ | (10 | ) | $ | 6,295 | |||||||
Municipal obligations | 8,246 | 2 | (92 | ) | 8,156 | |||||||||||
Asset-backed securities | 1,116 | — | (35 | ) | 1,081 | |||||||||||
Collateralized mortgage obligations - government issued | 30,936 | 423 | (146 | ) | 31,213 | |||||||||||
Collateralized mortgage obligations - government-sponsored enterprises | 99,865 | 252 | (969 | ) | 99,148 | |||||||||||
$ | 146,461 | $ | 684 | $ | (1,252 | ) | $ | 145,893 |
As of September 30, 2017 | ||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||
(In Thousands) | ||||||||||||||||
Held-to-maturity: | ||||||||||||||||
U.S. Government agency obligations - government-sponsored enterprises | $ | 1,498 | $ | — | $ | (5 | ) | $ | 1,493 | |||||||
Municipal obligations | 21,928 | 443 | (14 | ) | 22,357 | |||||||||||
Collateralized mortgage obligations - government issued | 9,601 | 16 | (33 | ) | 9,584 | |||||||||||
Collateralized mortgage obligations - government-sponsored enterprises | 5,846 | 12 | (18 | ) | 5,840 | |||||||||||
$ | 38,873 | $ | 471 | $ | (70 | ) | $ | 39,274 |
As of December 31, 2016 | ||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||
(In Thousands) | ||||||||||||||||
Held-to-maturity: | ||||||||||||||||
U.S. Government agency obligations - government-sponsored enterprises | $ | 1,497 | $ | 2 | $ | (5 | ) | $ | 1,494 | |||||||
Municipal obligations | 21,173 | 62 | (78 | ) | 21,157 | |||||||||||
Collateralized mortgage obligations - government issued | 9,148 | 17 | (38 | ) | 9,127 | |||||||||||
Collateralized mortgage obligations - government-sponsored enterprises | 6,794 | 6 | (58 | ) | 6,742 | |||||||||||
$ | 38,612 | $ | 87 | $ | (179 | ) | $ | 38,520 |
Available-for-Sale | Held-to-Maturity | |||||||||||||||
Amortized Cost | Fair Value | Amortized Cost | Fair Value | |||||||||||||
(In Thousands) | ||||||||||||||||
Due in one year or less | $ | 6,785 | $ | 6,783 | $ | — | $ | — | ||||||||
Due in one year through five years | 13,156 | 13,194 | 11,177 | 11,326 | ||||||||||||
Due in five through ten years | 48,051 | 48,168 | 13,258 | 13,495 | ||||||||||||
Due in over ten years | 63,507 | 62,985 | 14,438 | 14,453 | ||||||||||||
$ | 131,499 | $ | 131,130 | $ | 38,873 | $ | 39,274 |
As of September 30, 2017 | ||||||||||||||||||||||||
Less than 12 Months | 12 Months or Longer | Total | ||||||||||||||||||||||
Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | |||||||||||||||||||
(In Thousands) | ||||||||||||||||||||||||
Available-for-sale: | ||||||||||||||||||||||||
U.S. Government agency obligations - government-sponsored enterprises | $ | 800 | $ | — | $ | 1,997 | $ | 3 | $ | 2,797 | $ | 3 | ||||||||||||
Municipal obligations | 1,916 | 9 | 3,011 | 14 | 4,927 | 23 | ||||||||||||||||||
Collateralized mortgage obligations - government issued | 3,679 | 14 | 6,185 | 135 | 9,864 | 149 | ||||||||||||||||||
Collateralized mortgage obligations - government-sponsored enterprises | 32,752 | 121 | 31,883 | 563 | 64,635 | 684 | ||||||||||||||||||
$ | 39,147 | $ | 144 | $ | 43,076 | $ | 715 | $ | 82,223 | $ | 859 |
As of December 31, 2016 | ||||||||||||||||||||||||
Less than 12 Months | 12 Months or Longer | Total | ||||||||||||||||||||||
Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | |||||||||||||||||||
(In Thousands) | ||||||||||||||||||||||||
Available-for-sale: | ||||||||||||||||||||||||
U.S. Government agency obligations - government-sponsored enterprises | $ | 1,991 | $ | 10 | $ | — | $ | — | $ | 1,991 | $ | 10 | ||||||||||||
Municipal obligations | 7,207 | 89 | 406 | 3 | 7,613 | 92 | ||||||||||||||||||
Asset-backed securities | — | $ | — | 1,081 | 35 | 1,081 | 35 | |||||||||||||||||
Collateralized mortgage obligations - government issued | 10,552 | 130 | 493 | 16 | 11,045 | 146 | ||||||||||||||||||
Collateralized mortgage obligations - government-sponsored enterprises | 54,843 | 931 | 1,819 | 38 | 56,662 | 969 | ||||||||||||||||||
$ | 74,593 | $ | 1,160 | $ | 3,799 | $ | 92 | $ | 78,392 | $ | 1,252 |
As of September 30, 2017 | ||||||||||||||||||||||||
Less than 12 Months | 12 Months or Longer | Total | ||||||||||||||||||||||
Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | |||||||||||||||||||
(In Thousands) | ||||||||||||||||||||||||
Held-to-maturity: | ||||||||||||||||||||||||
U.S. Government agency obligations - government-sponsored enterprises | $ | 1,000 | $ | 5 | $ | — | $ | — | $ | 1,000 | $ | 5 | ||||||||||||
Municipal obligations | 853 | 11 | 260 | 3 | 1,113 | 14 | ||||||||||||||||||
Collateralized mortgage obligations - government issued | 2,806 | 8 | 3,804 | 25 | 6,610 | 33 | ||||||||||||||||||
Collateralized mortgage obligations - government-sponsored enterprises | — | — | 1,927 | 18 | 1,927 | 18 | ||||||||||||||||||
$ | 4,659 | $ | 24 | $ | 5,991 | $ | 46 | $ | 10,650 | $ | 70 |
As of December 31, 2016 | ||||||||||||||||||||||||
Less than 12 Months | 12 Months or Longer | Total | ||||||||||||||||||||||
Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | |||||||||||||||||||
(In Thousands) | ||||||||||||||||||||||||
Held-to-maturity: | ||||||||||||||||||||||||
U.S. Government agency obligations - government-sponsored enterprises | $ | 1,000 | $ | 5 | $ | — | $ | — | $ | 1,000 | $ | 5 | ||||||||||||
Municipal obligations | 9,472 | 78 | — | — | 9,472 | 78 | ||||||||||||||||||
Collateralized mortgage obligations - government issued | 6,980 | 38 | — | — | 6,980 | 38 | ||||||||||||||||||
Collateralized mortgage obligations - government-sponsored enterprises | 4,682 | 58 | — | — | 4,682 | 58 | ||||||||||||||||||
$ | 22,134 | $ | 179 | $ | — | $ | — | $ | 22,134 | $ | 179 |
September 30, 2017 | December 31, 2016 | |||||||
(In Thousands) | ||||||||
Commercial real estate: | ||||||||
Commercial real estate — owner occupied | $ | 182,755 | $ | 176,459 | ||||
Commercial real estate — non-owner occupied | 461,586 | 473,158 | ||||||
Land development | 41,499 | 56,638 | ||||||
Construction | 115,660 | 101,206 | ||||||
Multi-family | 125,080 | 92,762 | ||||||
1-4 family | 40,173 | 45,651 | ||||||
Total commercial real estate | 966,753 | 945,874 | ||||||
Commercial and industrial | 447,223 | 450,298 | ||||||
Direct financing leases, net | 28,868 | 30,951 | ||||||
Consumer and other: | ||||||||
Home equity and second mortgages | 7,776 | 8,412 | ||||||
Other | 17,447 | 16,329 | ||||||
Total consumer and other | 25,223 | 24,741 | ||||||
Total gross loans and leases receivable | 1,468,067 | 1,451,864 | ||||||
Less: | ||||||||
Allowance for loan and lease losses | 19,923 | 20,912 | ||||||
Deferred loan fees | 1,354 | 1,189 | ||||||
Loans and leases receivable, net | $ | 1,446,790 | $ | 1,429,763 |
September 30, 2017 | December 31, 2016 | |||||||
(In Thousands) | ||||||||
Retained, unguaranteed portion of sold SBA loans | $ | 30,632 | $ | 30,418 | ||||
Other SBA loans(1) | 25,684 | 31,728 | ||||||
Total SBA loans | $ | 56,316 | $ | 62,146 |
(1) | Primarily consisted of SBA Express loans, partially funded 7(a) program loans, and impaired SBA loans that were repurchased from the secondary market, all of which were not saleable as of September 30, 2017 and December 31, 2016, respectively. |
September 30, 2017 | ||||||||||||||||||||
Category | ||||||||||||||||||||
I | II | III | IV | Total | ||||||||||||||||
(Dollars in Thousands) | ||||||||||||||||||||
Commercial real estate: | ||||||||||||||||||||
Commercial real estate — owner occupied | $ | 147,603 | $ | 19,324 | $ | 8,690 | $ | 7,138 | $ | 182,755 | ||||||||||
Commercial real estate — non-owner occupied | 438,874 | 19,769 | 1,117 | 1,826 | 461,586 | |||||||||||||||
Land development | 37,659 | 795 | 275 | 2,770 | 41,499 | |||||||||||||||
Construction | 109,102 | 773 | 431 | 5,354 | 115,660 | |||||||||||||||
Multi-family | 125,080 | — | — | — | 125,080 | |||||||||||||||
1-4 family | 29,051 | 7,824 | 1,233 | 2,065 | 40,173 | |||||||||||||||
Total commercial real estate | 887,369 | 48,485 | 11,746 | 19,153 | 966,753 | |||||||||||||||
Commercial and industrial | 348,179 | 26,605 | 58,470 | 13,969 | 447,223 | |||||||||||||||
Direct financing leases, net | 26,854 | 305 | 1,709 | — | 28,868 | |||||||||||||||
Consumer and other: | ||||||||||||||||||||
Home equity and second mortgages | 7,764 | — | 8 | 4 | 7,776 | |||||||||||||||
Other | 17,066 | — | — | 381 | 17,447 | |||||||||||||||
Total consumer and other | 24,830 | — | 8 | 385 | 25,223 | |||||||||||||||
Total gross loans and leases receivable | $ | 1,287,232 | $ | 75,395 | $ | 71,933 | $ | 33,507 | $ | 1,468,067 | ||||||||||
Category as a % of total portfolio | 87.68 | % | 5.14 | % | 4.90 | % | 2.28 | % | 100.00 | % |
December 31, 2016 | ||||||||||||||||||||
Category | ||||||||||||||||||||
I | II | III | IV | Total | ||||||||||||||||
(Dollars in Thousands) | ||||||||||||||||||||
Commercial real estate: | ||||||||||||||||||||
Commercial real estate — owner occupied | $ | 142,704 | $ | 20,294 | $ | 11,174 | $ | 2,287 | $ | 176,459 | ||||||||||
Commercial real estate — non-owner occupied | 447,895 | 20,933 | 2,721 | 1,609 | 473,158 | |||||||||||||||
Land development | 52,082 | 823 | 293 | 3,440 | 56,638 | |||||||||||||||
Construction | 93,510 | 3,154 | 1,624 | 2,918 | 101,206 | |||||||||||||||
Multi-family | 87,418 | 1,937 | 3,407 | — | 92,762 | |||||||||||||||
1-4 family | 38,504 | 3,144 | 1,431 | 2,572 | 45,651 | |||||||||||||||
Total commercial real estate | 862,113 | 50,285 | 20,650 | 12,826 | 945,874 | |||||||||||||||
Commercial and industrial | 348,201 | 42,949 | 46,675 | 12,473 | 450,298 | |||||||||||||||
Direct financing leases, net | 29,351 | 1,600 | — | — | 30,951 | |||||||||||||||
Consumer and other: | ||||||||||||||||||||
Home equity and second mortgages | 8,271 | 121 | 12 | 8 | 8,412 | |||||||||||||||
Other | 15,714 | — | 11 | 604 | 16,329 | |||||||||||||||
Total consumer and other | 23,985 | 121 | 23 | 612 | 24,741 | |||||||||||||||
Total gross loans and leases receivable | $ | 1,263,650 | $ | 94,955 | $ | 67,348 | $ | 25,911 | $ | 1,451,864 | ||||||||||
Category as a % of total portfolio | 87.04 | % | 6.54 | % | 4.64 | % | 1.78 | % | 100.00 | % |
September 30, 2017 | |||||||||||||||||||||||||
30-59 Days Past Due | 60-89 Days Past Due | Greater Than 90 Days Past Due | Total Past Due | Current | Total Loans and Leases | ||||||||||||||||||||
(Dollars in Thousands) | |||||||||||||||||||||||||
Accruing loans and leases | |||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||
Owner occupied | $ | — | $ | — | $ | — | $ | — | $ | 175,675 | $ | 175,675 | |||||||||||||
Non-owner occupied | — | — | — | — | 459,760 | 459,760 | |||||||||||||||||||
Land development | — | — | — | — | 38,729 | 38,729 | |||||||||||||||||||
Construction | 392 | — | — | 392 | 109,914 | 110,306 | |||||||||||||||||||
Multi-family | — | — | — | — | 125,080 | 125,080 | |||||||||||||||||||
1-4 family | — | — | — | — | 38,309 | 38,309 | |||||||||||||||||||
Commercial and industrial | 2,257 | 470 | — | 2,727 | 430,539 | 433,266 | |||||||||||||||||||
Direct financing leases, net | — | — | — | — | 28,868 | 28,868 | |||||||||||||||||||
Consumer and other: | |||||||||||||||||||||||||
Home equity and second mortgages | 229 | — | — | 229 | 7,547 | 7,776 | |||||||||||||||||||
Other | — | — | — | — | 17,066 | 17,066 | |||||||||||||||||||
Total | 2,878 | 470 | — | 3,348 | 1,431,487 | 1,434,835 | |||||||||||||||||||
Non-accruing loans and leases | |||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||
Owner occupied | — | — | 4,825 | 4,825 | 2,255 | 7,080 | |||||||||||||||||||
Non-owner occupied | — | — | 1,791 | 1,791 | 35 | 1,826 | |||||||||||||||||||
Land development | — | — | — | — | 2,770 | 2,770 | |||||||||||||||||||
Construction | — | — | 5,353 | 5,353 | 1 | 5,354 | |||||||||||||||||||
Multi-family | — | — | — | — | — | — | |||||||||||||||||||
1-4 family | 529 | 10 | 1,041 | 1,580 | 284 | 1,864 | |||||||||||||||||||
Commercial and industrial | 207 | 497 | 11,005 | 11,709 | 2,248 | 13,957 | |||||||||||||||||||
Direct financing leases, net | — | — | — | — | — | — | |||||||||||||||||||
Consumer and other: | |||||||||||||||||||||||||
Home equity and second mortgages | — | — | — | — | — | — | |||||||||||||||||||
Other | — | — | 358 | 358 | 23 | 381 | |||||||||||||||||||
Total | 736 | 507 | 24,373 | 25,616 | 7,616 | — | 33,232 | ||||||||||||||||||
Total loans and leases | |||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||
Owner occupied | — | — | 4,825 | 4,825 | 177,930 | 182,755 | |||||||||||||||||||
Non-owner occupied | — | — | 1,791 | 1,791 | 459,795 | 461,586 | |||||||||||||||||||
Land development | — | — | — | — | 41,499 | 41,499 | |||||||||||||||||||
Construction | 392 | — | 5,353 | 5,745 | 109,915 | 115,660 | |||||||||||||||||||
Multi-family | — | — | — | — | 125,080 | 125,080 | |||||||||||||||||||
1-4 family | 529 | 10 | 1,041 | 1,580 | 38,593 | 40,173 | |||||||||||||||||||
Commercial and industrial | 2,464 | 967 | 11,005 | 14,436 | 432,787 | 447,223 | |||||||||||||||||||
Direct financing leases, net | — | — | — | — | 28,868 | 28,868 | |||||||||||||||||||
Consumer and other: | |||||||||||||||||||||||||
Home equity and second mortgages | 229 | — | — | 229 | 7,547 | 7,776 | |||||||||||||||||||
Other | — | — | 358 | 358 | 17,089 | 17,447 | |||||||||||||||||||
Total | $ | 3,614 | $ | 977 | $ | 24,373 | $ | 28,964 | $ | 1,439,103 | $ | 1,468,067 | |||||||||||||
Percent of portfolio | 0.24 | % | 0.07 | % | 1.66 | % | 1.97 | % | 98.03 | % | 100.00 | % |
December 31, 2016 | ||||||||||||||||||||||||
30-59 Days Past Due | 60-89 Days Past Due | Greater Than 90 Days Past Due | Total Past Due | Current | Total Loans and Leases | |||||||||||||||||||
(Dollars in Thousands) | ||||||||||||||||||||||||
Accruing loans and leases | ||||||||||||||||||||||||
Commercial real estate: | ||||||||||||||||||||||||
Owner occupied | $ | — | $ | — | $ | — | $ | — | $ | 174,236 | $ | 174,236 | ||||||||||||
Non-owner occupied | — | — | — | — | 471,549 | 471,549 | ||||||||||||||||||
Land development | — | — | — | — | 53,198 | 53,198 | ||||||||||||||||||
Construction | — | — | — | — | 98,288 | 98,288 | ||||||||||||||||||
Multi-family | — | — | — | — | 92,762 | 92,762 | ||||||||||||||||||
1-4 family | 75 | — | — | 75 | 43,639 | 43,714 | ||||||||||||||||||
Commercial and industrial | 55 | 468 | — | 523 | 437,312 | 437,835 | ||||||||||||||||||
Direct financing leases, net | — | — | — | — | 30,951 | 30,951 | ||||||||||||||||||
Consumer and other: | ||||||||||||||||||||||||
Home equity and second mortgages | — | — | — | — | 8,412 | 8,412 | ||||||||||||||||||
Other | — | — | — | — | 15,725 | 15,725 | ||||||||||||||||||
Total | 130 | 468 | — | 598 | 1,426,072 | 1,426,670 | ||||||||||||||||||
Non-accruing loans and leases | ||||||||||||||||||||||||
Commercial real estate: | ||||||||||||||||||||||||
Owner occupied | — | — | 1,183 | 1,183 | 1,040 | 2,223 | ||||||||||||||||||
Non-owner occupied | — | — | — | — | 1,609 | 1,609 | ||||||||||||||||||
Land development | — | — | — | — | 3,440 | 3,440 | ||||||||||||||||||
Construction | 2,482 | — | 436 | 2,918 | — | 2,918 | ||||||||||||||||||
Multi-family | — | — | — | — | — | — | ||||||||||||||||||
1-4 family | — | — | 1,240 | 1,240 | 697 | 1,937 | ||||||||||||||||||
Commercial and industrial | 3,345 | 168 | 6,740 | 10,253 | 2,210 | 12,463 | ||||||||||||||||||
Direct financing leases, net | — | — | — | — | — | — | ||||||||||||||||||
Consumer and other: | ||||||||||||||||||||||||
Home equity and second mortgages | — | — | — | — | — | — | ||||||||||||||||||
Other | 186 | — | 378 | 564 | 40 | 604 | ||||||||||||||||||
Total | 6,013 | 168 | 9,977 | 16,158 | 9,036 | 25,194 | ||||||||||||||||||
Total loans and leases | ||||||||||||||||||||||||
Commercial real estate: | ||||||||||||||||||||||||
Owner occupied | — | — | 1,183 | 1,183 | 175,276 | 176,459 | ||||||||||||||||||
Non-owner occupied | — | — | — | — | 473,158 | 473,158 | ||||||||||||||||||
Land development | — | — | — | — | 56,638 | 56,638 | ||||||||||||||||||
Construction | 2,482 | — | 436 | 2,918 | 98,288 | 101,206 | ||||||||||||||||||
Multi-family | — | — | — | — | 92,762 | 92,762 | ||||||||||||||||||
1-4 family | 75 | — | 1,240 | 1,315 | 44,336 | 45,651 | ||||||||||||||||||
Commercial and industrial | 3,400 | 636 | 6,740 | 10,776 | 439,522 | 450,298 | ||||||||||||||||||
Direct financing leases, net | — | — | — | — | 30,951 | 30,951 | ||||||||||||||||||
Consumer and other: | ||||||||||||||||||||||||
Home equity and second mortgages | — | — | — | — | 8,412 | 8,412 | ||||||||||||||||||
Other | 186 | — | 378 | 564 | 15,765 | 16,329 | ||||||||||||||||||
Total | $ | 6,143 | $ | 636 | $ | 9,977 | $ | 16,756 | $ | 1,435,108 | $ | 1,451,864 | ||||||||||||
Percent of portfolio | 0.42 | % | 0.04 | % | 0.69 | % | 1.15 | % | 98.85 | % | 100.00 | % |
September 30, 2017 | December 31, 2016 | |||||||
(Dollars in Thousands) | ||||||||
Non-accrual loans and leases | ||||||||
Commercial real estate: | ||||||||
Commercial real estate — owner occupied | $ | 7,080 | $ | 2,223 | ||||
Commercial real estate — non-owner occupied | 1,826 | 1,609 | ||||||
Land development | 2,770 | 3,440 | ||||||
Construction | 5,354 | 2,918 | ||||||
Multi-family | — | — | ||||||
1-4 family | 1,864 | 1,937 | ||||||
Total non-accrual commercial real estate | 18,894 | 12,127 | ||||||
Commercial and industrial | 13,957 | 12,463 | ||||||
Direct financing leases, net | — | — | ||||||
Consumer and other: | ||||||||
Home equity and second mortgages | — | — | ||||||
Other | 381 | 604 | ||||||
Total non-accrual consumer and other loans | 381 | 604 | ||||||
Total non-accrual loans and leases | 33,232 | 25,194 | ||||||
Foreclosed properties, net | 2,585 | 1,472 | ||||||
Total non-performing assets | 35,817 | 26,666 | ||||||
Performing troubled debt restructurings | 275 | 717 | ||||||
Total impaired assets | $ | 36,092 | $ | 27,383 |
September 30, 2017 | December 31, 2016 | |||||
Total non-accrual loans and leases to gross loans and leases | 2.26 | % | 1.74 | % | ||
Total non-performing assets to total gross loans and leases plus foreclosed properties, net | 2.44 | 1.83 | ||||
Total non-performing assets to total assets | 2.01 | 1.50 | ||||
Allowance for loan and lease losses to gross loans and leases | 1.36 | 1.44 | ||||
Allowance for loan and lease losses to non-accrual loans and leases | 59.95 | 83.00 |
As of September 30, 2017 | As of December 31, 2016 | |||||||||||||||||||
Number of Loans | Pre-Modification Recorded Investment | Post-Modification Recorded Investment | Number of Loans | Pre-Modification Recorded Investment | Post-Modification Recorded Investment | |||||||||||||||
(Dollars in Thousands) | ||||||||||||||||||||
Commercial real estate: | ||||||||||||||||||||
Commercial real estate — owner occupied | 3 | $ | 1,065 | $ | 888 | 3 | $ | 1,065 | $ | 930 | ||||||||||
Commercial real estate — non-owner occupied | 1 | 158 | 35 | 1 | 158 | 39 | ||||||||||||||
Land development | 1 | 5,745 | 2,770 | 1 | 5,745 | 3,440 | ||||||||||||||
Construction | — | — | — | 2 | 331 | 314 | ||||||||||||||
Multi-family | — | — | — | — | — | — | ||||||||||||||
1-4 family | 10 | 1,287 | 1,353 | 11 | 1,391 | 1,393 | ||||||||||||||
Commercial and industrial | 11 | 8,944 | 5,759 | 10 | 8,094 | 7,058 | ||||||||||||||
Consumer and other: | ||||||||||||||||||||
Home equity and second mortgage | 1 | 37 | 4 | 1 | 37 | 8 | ||||||||||||||
Other | 2 | 2,094 | 359 | 1 | 2,076 | 378 | ||||||||||||||
Total | 29 | $ | 19,330 | $ | 11,168 | 30 | $ | 18,897 | $ | 13,560 |
As of September 30, 2017 | As of December 31, 2016 | |||||||||||||
Number of Loans | Recorded Investment | Number of Loans | Recorded Investment | |||||||||||
(Dollars in Thousands) | ||||||||||||||
Commercial real estate: | ||||||||||||||
Extension of term | — | $ | — | 1 | $ | 8 | ||||||||
Interest rate concession | 1 | 49 | 1 | 52 | ||||||||||
Combination of extension of term and interest rate concession | 14 | 4,997 | 16 | 6,056 | ||||||||||
Commercial and industrial: | ||||||||||||||
Combination of extension of term and interest rate concession | 11 | 5,759 | 10 | 7,058 | ||||||||||
Consumer and other: | ||||||||||||||
Extension of term | 1 | 342 | 1 | 378 | ||||||||||
Combination of extension of term and interest rate concession | 2 | 21 | 1 | 8 | ||||||||||
Total | 29 | $ | 11,168 | 30 | $ | 13,560 |
As of and for the Nine Months Ended September 30, 2017 | |||||||||||||||||||||||||||||||
Recorded Investment | Unpaid Principal Balance | Impairment Reserve | Average Recorded Investment(1) | Foregone Interest Income | Interest Income Recognized | Net Foregone Interest Income | |||||||||||||||||||||||||
(In Thousands) | |||||||||||||||||||||||||||||||
With no impairment reserve recorded: | |||||||||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||
Owner occupied | $ | 6,727 | $ | 6,727 | $ | — | $ | 4,898 | $ | 394 | $ | — | $ | 394 | |||||||||||||||||
Non-owner occupied | 1,826 | 1,866 | — | 1,932 | 99 | — | 99 | ||||||||||||||||||||||||
Land development | 2,770 | 5,441 | — | 3,218 | 65 | — | 65 | ||||||||||||||||||||||||
Construction | 2,482 | 2,482 | — | 611 | 208 | — | 208 | ||||||||||||||||||||||||
Multi-family | — | — | — | 1 | — | — | — | ||||||||||||||||||||||||
1-4 family | 2,065 | 2,319 | — | 2,387 | 69 | — | 69 | ||||||||||||||||||||||||
Commercial and industrial | 1,740 | 2,103 | — | 6,782 | 509 | — | 509 | ||||||||||||||||||||||||
Direct financing leases, net | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Consumer and other: | |||||||||||||||||||||||||||||||
Home equity and second mortgages | 4 | 4 | — | 6 | — | — | — | ||||||||||||||||||||||||
Other | 358 | 1,025 | — | 397 | 45 | — | 45 | ||||||||||||||||||||||||
Total | 17,972 | 21,967 | — | 20,232 | 1,389 | — | 1,389 | ||||||||||||||||||||||||
With impairment reserve recorded: | |||||||||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||
Owner occupied | 411 | 411 | 15 | 424 | 19 | — | 19 | ||||||||||||||||||||||||
Non-owner occupied | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Land development | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||
Construction | 2,872 | 2,872 | — | 94 | 4,091 | — | 108 | — | — | 108 | |||||||||||||||||||||
Multi-family | — | — | — | — | — | — | — | ||||||||||||||||||||||||
1-4 family | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Commercial and industrial | 12,229 | 12,702 | 5,658 | 10,114 | 453 | — | 453 | ||||||||||||||||||||||||
Direct financing leases, net | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Consumer and other: | |||||||||||||||||||||||||||||||
Home equity and second mortgages | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Other | 23 | 23 | 23 | 10 | — | — | — | ||||||||||||||||||||||||
Total | 15,535 | 16,008 | 5,790 | 14,639 | 580 | — | 580 | ||||||||||||||||||||||||
Total: | |||||||||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||
Owner occupied | 7,138 | 7,138 | 15 | 5,322 | 413 | — | 413 | ||||||||||||||||||||||||
Non-owner occupied | 1,826 | 1,866 | — | 1,932 | 99 | — | 99 | ||||||||||||||||||||||||
Land development | 2,770 | 5,441 | — | 3,218 | 65 | — | 65 | ||||||||||||||||||||||||
Construction | 5,354 | 5,354 | 94 | 4,702 | 316 | — | 316 | ||||||||||||||||||||||||
Multi-family | — | — | — | 1 | — | — | — | ||||||||||||||||||||||||
1-4 family | 2,065 | 2,319 | — | 2,387 | 69 | — | 69 | ||||||||||||||||||||||||
Commercial and industrial | 13,969 | 14,805 | 5,658 | 16,896 | 962 | — | 962 | ||||||||||||||||||||||||
Direct financing leases, net | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Consumer and other: | |||||||||||||||||||||||||||||||
Home equity and second mortgages | 4 | 4 | — | 6 | — | — | — | ||||||||||||||||||||||||
Other | 381 | 1,048 | 23 | 407 | 45 | — | 45 | ||||||||||||||||||||||||
Grand total | $ | 33,507 | $ | 37,975 | $ | 5,790 | $ | 34,871 | $ | 1,969 | $ | — | $ | 1,969 |
(1) | Average recorded investment is calculated primarily using daily average balances. |
As of and for the Year Ended December 31, 2016 | ||||||||||||||||||||||||||||
Recorded Investment | Unpaid Principal Balance | Impairment Reserve | Average Recorded Investment(1) | Foregone Interest Income | Interest Income Recognized | Net Foregone Interest Income | ||||||||||||||||||||||
(In Thousands) | ||||||||||||||||||||||||||||
With no impairment reserve recorded: | ||||||||||||||||||||||||||||
Commercial real estate: | ||||||||||||||||||||||||||||
Owner occupied | $ | 1,788 | $ | 1,788 | $ | — | $ | 3,577 | $ | 328 | $ | 118 | $ | 210 | ||||||||||||||
Non-owner occupied | 1,609 | 1,647 | — | 1,318 | 91 | 79 | 12 | |||||||||||||||||||||
Land development | 3,440 | 6,111 | — | 3,898 | 107 | — | 107 | |||||||||||||||||||||
Construction | 436 | 438 | — | 291 | 20 | — | 20 | |||||||||||||||||||||
Multi-family | — | — | — | — | 1 | 134 | (133 | ) | ||||||||||||||||||||
1-4 family | 2,379 | 2,379 | — | 2,755 | 125 | 94 | 31 | |||||||||||||||||||||
Commercial and industrial | 1,307 | 1,307 | — | 709 | 79 | 62 | 17 | |||||||||||||||||||||
Direct financing leases, net | — | — | — | 6 | — | — | — | |||||||||||||||||||||
Consumer and other: | ||||||||||||||||||||||||||||
Home equity and second mortgages | 8 | 8 | — | 307 | 16 | 127 | (111 | ) | ||||||||||||||||||||
Other | 378 | 1,044 | — | 510 | 71 | — | 71 | |||||||||||||||||||||
Total | 11,345 | 14,722 | — | 13,371 | 838 | 614 | 224 | |||||||||||||||||||||
With impairment reserve recorded: | ||||||||||||||||||||||||||||
Commercial real estate: | ||||||||||||||||||||||||||||
Owner occupied | 499 | 499 | 70 | 111 | 28 | — | 28 | |||||||||||||||||||||
Non-owner occupied | — | — | — | — | — | — | — | |||||||||||||||||||||
Land development | — | — | — | — | — | — | — | |||||||||||||||||||||
Construction | 2,482 | 2,482 | 1,790 | 834 | 45 | — | 45 | |||||||||||||||||||||
Multi-family | — | — | — | — | — | — | — | |||||||||||||||||||||
1-4 family | 193 | 199 | 39 | 203 | 5 | — | 5 | |||||||||||||||||||||
Commercial and industrial | 11,166 | 11,166 | 3,700 | 8,448 | 701 | — | 701 | |||||||||||||||||||||
Direct financing leases, net | — | — | — | — | — | — | — | |||||||||||||||||||||
Consumer and other: | ||||||||||||||||||||||||||||
Home equity and second mortgages | — | — | — | — | — | — | — | |||||||||||||||||||||
Other | 226 | 226 | — | 19 | — | — | — | |||||||||||||||||||||
Total | 14,566 | 14,572 | 5,599 | 9,615 | 779 | — | 779 | |||||||||||||||||||||
Total: | ||||||||||||||||||||||||||||
Commercial real estate: | ||||||||||||||||||||||||||||
Owner occupied | 2,287 | 2,287 | 70 | 3,688 | 356 | 118 | 238 | |||||||||||||||||||||
Non-owner occupied | 1,609 | 1,647 | — | 1,318 | 91 | 79 | 12 | |||||||||||||||||||||
Land development | 3,440 | 6,111 | — | 3,898 | 107 | — | 107 | |||||||||||||||||||||
Construction | 2,918 | 2,920 | 1,790 | 1,125 | 65 | — | 65 | |||||||||||||||||||||
Multi-family | — | — | — | — | 1 | 134 | (133 | ) | ||||||||||||||||||||
1-4 family | 2,572 | 2,578 | 39 | 2,958 | 130 | 94 | 36 | |||||||||||||||||||||
Commercial and industrial | 12,473 | 12,473 | 3,700 | 9,157 | 780 | 62 | 718 | |||||||||||||||||||||
Direct financing leases, net | — | — | — | 6 | — | — | — | |||||||||||||||||||||
Consumer and other: | ||||||||||||||||||||||||||||
Home equity and second mortgages | 8 | 8 | — | 307 | 16 | 127 | (111 | ) | ||||||||||||||||||||
Other | 604 | 1,270 | — | 529 | 71 | — | 71 | |||||||||||||||||||||
Grand total | $ | 25,911 | $ | 29,294 | $ | 5,599 | $ | 22,986 | $ | 1,617 | $ | 614 | $ | 1,003 |
(1) | Average recorded investment is calculated primarily using daily average balances. |
As of and for the Three Months Ended September 30, 2017 | ||||||||||||||||
Commercial Real Estate | Commercial and Industrial | Consumer and Other | Total | |||||||||||||
(Dollars in Thousands) | ||||||||||||||||
Beginning balance | $ | 12,003 | $ | 9,090 | $ | 584 | $ | 21,677 | ||||||||
Charge-offs | (8 | ) | (3,217 | ) | (5 | ) | (3,230 | ) | ||||||||
Recoveries | 2 | 2 | 1 | 5 | ||||||||||||
Net charge-offs | (6 | ) | (3,215 | ) | (4 | ) | (3,225 | ) | ||||||||
Provision for credit losses | (2,462 | ) | 3,968 | (35 | ) | 1,471 | ||||||||||
Ending balance | $ | 9,535 | $ | 9,843 | $ | 545 | $ | 19,923 |
As of and for the Three Months Ended September 30, 2016 | ||||||||||||||||
Commercial Real Estate | Commercial and Industrial | Consumer and Other | Total | |||||||||||||
(Dollars in Thousands) | ||||||||||||||||
Beginning balance | $ | 11,436 | $ | 6,017 | $ | 701 | $ | 18,154 | ||||||||
Charge-offs | (259 | ) | (1,396 | ) | (1 | ) | (1,656 | ) | ||||||||
Recoveries | 31 | — | 1 | 32 | ||||||||||||
Net charge-offs | (228 | ) | (1,396 | ) | — | (1,624 | ) | |||||||||
Provision for credit losses | 1,607 | 2,051 | (121 | ) | 3,537 | |||||||||||
Ending balance | $ | 12,815 | $ | 6,672 | $ | 580 | $ | 20,067 |
As of and for the Nine Months Ended September 30, 2017 | ||||||||||||||||
Commercial Real Estate | Commercial and Industrial | Consumer and Other | Total | |||||||||||||
(Dollars in Thousands) | ||||||||||||||||
Beginning balance | $ | 12,384 | $ | 7,970 | $ | 558 | $ | 20,912 | ||||||||
Charge-offs | (126 | ) | (6,978 | ) | (92 | ) | (7,196 | ) | ||||||||
Recoveries | 152 | 314 | 42 | 508 | ||||||||||||
Net recoveries (charge-offs) | 26 | (6,664 | ) | (50 | ) | (6,688 | ) | |||||||||
Provision for credit loss | (2,875 | ) | 8,537 | 37 | 5,699 | |||||||||||
Ending balance | $ | 9,535 | $ | 9,843 | $ | 545 | $ | 19,923 |
As of and for the Nine Months Ended September 30, 2016 | ||||||||||||||||
Commercial Real Estate | Commercial and Industrial | Consumer and Other | Total | |||||||||||||
(Dollars in Thousands) | ||||||||||||||||
Beginning balance | $ | 11,220 | $ | 4,387 | $ | 709 | $ | 16,316 | ||||||||
Charge-offs | (1,194 | ) | (2,048 | ) | (8 | ) | (3,250 | ) | ||||||||
Recoveries | 170 | 2 | 5 | 177 | ||||||||||||
Net charge-offs | (1,024 | ) | (2,046 | ) | (3 | ) | (3,073 | ) | ||||||||
Provision for credit loss | 2,619 | 4,331 | (126 | ) | 6,824 | |||||||||||
Ending balance | $ | 12,815 | $ | 6,672 | $ | 580 | $ | 20,067 |
As of September 30, 2017 | ||||||||||||||||
Commercial Real Estate | Commercial and Industrial | Consumer and Other | Total | |||||||||||||
(Dollars in Thousands) | ||||||||||||||||
Allowance for loan and lease losses: | ||||||||||||||||
Collectively evaluated for impairment | $ | 9,426 | $ | 4,185 | $ | 522 | $ | 14,133 | ||||||||
Individually evaluated for impairment | 109 | 5,658 | 23 | 5,790 | ||||||||||||
Loans acquired with deteriorated credit quality | — | — | — | — | ||||||||||||
Total | $ | 9,535 | $ | 9,843 | $ | 545 | $ | 19,923 | ||||||||
Loans and lease receivables: | ||||||||||||||||
Collectively evaluated for impairment | $ | 947,600 | $ | 462,122 | $ | 24,838 | $ | 1,434,560 | ||||||||
Individually evaluated for impairment | 18,535 | 13,962 | 385 | 32,882 | ||||||||||||
Loans acquired with deteriorated credit quality | 618 | 7 | — | 625 | ||||||||||||
Total | $ | 966,753 | $ | 476,091 | $ | 25,223 | $ | 1,468,067 |
As of December 31, 2016 | ||||||||||||||||
Commercial Real Estate | Commercial and Industrial | Consumer and Other | Total | |||||||||||||
(Dollars in Thousands) | ||||||||||||||||
Allowance for loan and lease losses: | ||||||||||||||||
Collectively evaluated for impairment | $ | 10,485 | $ | 4,270 | $ | 558 | $ | 15,313 | ||||||||
Individually evaluated for impairment | 1,899 | 3,700 | — | 5,599 | ||||||||||||
Loans acquired with deteriorated credit quality | — | — | — | — | ||||||||||||
Total | $ | 12,384 | $ | 7,970 | $ | 558 | $ | 20,912 | ||||||||
Loans and lease receivables: | ||||||||||||||||
Collectively evaluated for impairment | $ | 933,048 | $ | 468,776 | $ | 24,129 | $ | 1,425,953 | ||||||||
Individually evaluated for impairment | 11,222 | 12,452 | 612 | 24,286 | ||||||||||||
Loans acquired with deteriorated credit quality | 1,604 | 21 | — | 1,625 | ||||||||||||
Total | $ | 945,874 | $ | 481,249 | $ | 24,741 | $ | 1,451,864 |
September 30, 2017 | December 31, 2016 | |||||||
(In Thousands) | ||||||||
Accrued interest receivable | $ | 4,722 | $ | 4,677 | ||||
Net deferred tax asset | 5,543 | 4,052 | ||||||
Investment in historic development entities | 1,154 | 737 | ||||||
Investment in a CDE | 6,719 | 7,106 | ||||||
Investment in limited partnerships | 4,607 | 3,963 | ||||||
Investment in Trust II | 315 | 315 | ||||||
Fair value of interest rate swaps | 1,380 | 352 | ||||||
Prepaid expenses | 3,338 | 3,074 | ||||||
Other assets | 4,450 | 4,331 | ||||||
Total accrued interest receivable and other assets | $ | 32,228 | $ | 28,607 |
September 30, 2017 | December 31, 2016 | |||||||||||||||||||||
Balance | Average Balance | Average Rate | Balance | Average Balance | Average Rate | |||||||||||||||||
(Dollars in Thousands) | ||||||||||||||||||||||
Non-interest-bearing transaction accounts | $ | 253,320 | $ | 228,231 | — | % | $ | 252,638 | $ | 246,182 | — | % | ||||||||||
Interest-bearing transaction accounts | 251,355 | 221,526 | 0.53 | 183,992 | 169,571 | 0.27 | ||||||||||||||||
Money market accounts | 527,705 | 601,455 | 0.45 | 627,090 | 642,784 | 0.48 | ||||||||||||||||
Certificates of deposit | 58,144 | 55,888 | 0.98 | 58,454 | 65,608 | 0.90 | ||||||||||||||||
Wholesale deposits | 333,200 | 374,083 | 1.68 | 416,681 | 467,826 | 1.62 | ||||||||||||||||
Total deposits | $ | 1,423,724 | $ | 1,481,183 | 0.72 | $ | 1,538,855 | $ | 1,591,971 | 0.74 |
September 30, 2017 | December 31, 2016 | |||||||||||||||||||||
Balance | Weighted Average Balance | Weighted Average Rate | Balance | Weighted Average Balance | Weighted Average Rate | |||||||||||||||||
(Dollars in Thousands) | ||||||||||||||||||||||
Federal funds purchased | $ | — | $ | 88 | 1.21 | % | $ | — | $ | 178 | 0.92 | % | ||||||||||
FHLB advances | 143,500 | 83,987 | 1.24 | 33,578 | 14,485 | 0.97 | ||||||||||||||||
Line of credit | 10 | 435 | 3.63 | 1,010 | 2,079 | 3.26 | ||||||||||||||||
Other borrowings(1) | 675 | 1,432 | 15.37 | 2,590 | 1,739 | 7.64 | ||||||||||||||||
Subordinated notes payable | 23,699 | 22,978 | 7.04 | 22,498 | 22,467 | 7.13 | ||||||||||||||||
Junior subordinated notes | 10,015 | 10,009 | 11.08 | 10,004 | 9,997 | 11.07 | ||||||||||||||||
$ | 177,899 | $ | 118,929 | 3.38 | $ | 69,680 | $ | 50,945 | 6.03 | |||||||||||||
Short-term borrowings | $ | 54,510 | $ | 20,588 | ||||||||||||||||||
Long-term borrowings | 123,389 | 49,092 | ||||||||||||||||||||
$ | 177,899 | $ | 69,680 |
(1) | Weighted average rate of other borrowings reflects the cost of prepaying a secured borrowing during the second quarter of 2017. |
As of and for the Nine Months Ended September 30, 2017 | As of and for the Year Ended December 31, 2016 | |||||||
(In Thousands) | ||||||||
Balance at the beginning of the period | $ | 1,750 | $ | — | ||||
SBA recourse provision | 2,095 | 2,068 | ||||||
Charge-offs, net | (1,141 | ) | (318 | ) | ||||
Balance at the end of the period | $ | 2,704 | $ | 1,750 |
September 30, 2017 | ||||||||||||||||
Fair Value Measurements Using | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
(In Thousands) | ||||||||||||||||
Assets: | ||||||||||||||||
Securities available-for-sale: | ||||||||||||||||
U.S. Government agency obligations - government-sponsored enterprises | $ | — | $ | 3,807 | $ | — | $ | 3,807 | ||||||||
Municipal obligations | — | 9,332 | — | 9,332 | ||||||||||||
Collateralized mortgage obligations - government issued | — | 22,902 | — | 22,902 | ||||||||||||
Collateralized mortgage obligations - government-sponsored enterprises | — | 95,089 | — | 95,089 | ||||||||||||
Interest rate swaps | — | 1,380 | — | 1,380 | ||||||||||||
Liabilities: | ||||||||||||||||
Interest rate swaps | — | 1,380 | — | 1,380 |
December 31, 2016 | ||||||||||||||||
Fair Value Measurements Using | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
(In Thousands) | ||||||||||||||||
Assets: | ||||||||||||||||
Securities available-for-sale: | ||||||||||||||||
U.S. Government agency obligations - government-sponsored enterprises | $ | — | $ | 6,295 | $ | — | $ | 6,295 | ||||||||
Municipal obligations | — | 8,156 | — | 8,156 | ||||||||||||
Asset backed securities | — | 1,081 | — | 1,081 | ||||||||||||
Collateralized mortgage obligations - government issued | — | 31,213 | — | 31,213 | ||||||||||||
Collateralized mortgage obligations - government-sponsored enterprises | — | 99,148 | — | 99,148 | ||||||||||||
Interest rate swaps | — | 352 | — | 352 | ||||||||||||
Liabilities: | ||||||||||||||||
Interest rate swaps | — | 352 | — | 352 |
September 30, 2017 | ||||||||||||||||
Fair Value Measurements Using | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
(In Thousands) | ||||||||||||||||
Impaired loans | $ | — | $ | 7,637 | $ | 8,661 | $ | 16,298 | ||||||||
Foreclosed properties | — | 1,472 | — | 1,472 |
December 31, 2016 | ||||||||||||||||
Fair Value Measurements Using | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
(In Thousands) | ||||||||||||||||
Impaired loans | $ | — | $ | 12,268 | $ | 1,097 | $ | 13,365 | ||||||||
Foreclosed properties | — | 1,472 | — | 1,472 |
September 30, 2017 | ||||||||||||||||||||
Carrying Amount | Fair Value | |||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||||||||
(In Thousands) | ||||||||||||||||||||
Financial assets: | ||||||||||||||||||||
Cash and cash equivalents | $ | 73,196 | $ | 73,218 | $ | 56,487 | $ | 16,731 | $ | — | ||||||||||
Securities available-for-sale | 131,130 | 131,130 | — | 131,130 | — | |||||||||||||||
Securities held-to-maturity | 38,873 | 39,274 | — | 39,274 | — | |||||||||||||||
Loans held for sale | — | — | — | — | — | |||||||||||||||
Loans and lease receivables, net | 1,446,790 | 1,427,071 | — | 7,637 | 1,419,434 | |||||||||||||||
Bank-owned life insurance | 39,988 | 39,988 | 39,988 | — | — | |||||||||||||||
Federal Home Loan Bank and Federal Reserve Bank stock | 5,083 | 5,083 | — | — | 5,083 | |||||||||||||||
Accrued interest receivable | 4,722 | 4,722 | 4,722 | — | — | |||||||||||||||
Interest rate swaps | 1,380 | 1,380 | — | 1,380 | — | |||||||||||||||
Financial liabilities: | ||||||||||||||||||||
Deposits | 1,423,724 | 1,424,275 | 1,032,379 | 391,896 | — | |||||||||||||||
Federal Home Loan Bank advances and other borrowings | 167,884 | 152,391 | — | 152,391 | — | |||||||||||||||
Junior subordinated notes | 10,015 | 8,829 | — | — | 8,829 | |||||||||||||||
Accrued interest payable | 2,317 | 2,317 | 2,317 | — | — | |||||||||||||||
Interest rate swaps | 1,380 | 1,380 | — | 1,380 | — | |||||||||||||||
Off-balance-sheet items: | ||||||||||||||||||||
Standby letters of credit | 86 | 86 | — | — | 86 |
December 31, 2016 | ||||||||||||||||||||
Carrying Amount | Fair Value | |||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||||||||
(In Thousands) | ||||||||||||||||||||
Financial assets: | ||||||||||||||||||||
Cash and cash equivalents | $ | 77,517 | $ | 77,517 | $ | 55,622 | $ | 21,895 | $ | — | ||||||||||
Securities available-for-sale | 145,893 | 145,893 | — | 145,893 | — | |||||||||||||||
Securities held-to-maturity | 38,612 | 38,520 | — | 38,520 | — | |||||||||||||||
Loans held for sale | 1,111 | 1,222 | — | 1,222 | — | |||||||||||||||
Loans and lease receivables, net | 1,429,763 | 1,447,044 | — | 12,268 | 1,434,776 | |||||||||||||||
Bank-owned life insurance | 39,048 | 39,048 | — | 39,048 | — | |||||||||||||||
Federal Home Loan Bank and Federal Reserve Bank stock | 2,131 | 2,131 | — | 2,131 | — | |||||||||||||||
Accrued interest receivable | 4,677 | 4,677 | 4,677 | — | — | |||||||||||||||
Interest rate swaps | 352 | 352 | — | 352 | — | |||||||||||||||
Financial liabilities: | ||||||||||||||||||||
Deposits | 1,538,855 | 1,539,413 | 1,063,720 | 475,693 | — | |||||||||||||||
Federal Home Loan Bank advances and other borrowings | 59,676 | 60,893 | — | 60,893 | — | |||||||||||||||
Junior subordinated notes | 10,004 | 9,072 | — | — | 9,072 | |||||||||||||||
Accrued interest payable | 1,765 | 1,765 | 1,765 | — | — | |||||||||||||||
Interest rate swaps | 352 | 352 | — | 352 | — | |||||||||||||||
Off-balance-sheet items: | ||||||||||||||||||||
Standby letters of credit | 58 | 58 | — | — | 58 |
Interest Rate Swap Contracts | ||||||||||||
Asset Derivatives | Liability Derivatives | |||||||||||
Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | |||||||||
(In Thousands) | ||||||||||||
Derivatives not designated as hedging instruments | ||||||||||||
September 30, 2017 | Accrued interest receivable and other assets | $ | 1,380 | Accrued interest payable and other liabilities | $ | 1,380 | ||||||
December 31, 2016 | Accrued interest receivable and other assets | $ | 352 | Accrued interest payable and other liabilities | $ | 352 |
Actual | Minimum Required for Capital Adequacy Purposes | For Capital Adequacy Purposes Plus Capital Conservation Buffer | Minimum Required to Be Well Capitalized Under Prompt Corrective Action Requirements | |||||||||||||||||||||||||
Amount | Ratio | Amount | Ratio | Amount | Ratio | Amount | Ratio | |||||||||||||||||||||
(Dollars in Thousands) | ||||||||||||||||||||||||||||
As of September 30, 2017 | ||||||||||||||||||||||||||||
Total capital (to risk-weighted assets) | ||||||||||||||||||||||||||||
Consolidated | $ | 209,495 | 11.91 | % | $ | 140,737 | 8.00 | % | $ | 162,727 | 9.25 | % | N/A | N/A | ||||||||||||||
First Business Bank | 205,877 | 11.75 | 140,132 | 8.00 | 162,027 | 9.25 | $ | 175,164 | 10.00 | % | ||||||||||||||||||
Tier 1 capital (to risk-weighted assets) | ||||||||||||||||||||||||||||
Consolidated | $ | 165,873 | 9.43 | % | $ | 105,553 | 6.00 | % | $ | 127,543 | 7.25 | % | N/A | N/A | ||||||||||||||
First Business Bank | 185,954 | 10.62 | 105,099 | 6.00 | 126,994 | 7.25 | $ | 140,132 | 8.00 | % | ||||||||||||||||||
Common equity tier 1 capital (to risk-weighted assets) | ||||||||||||||||||||||||||||
Consolidated | $ | 155,858 | 8.86 | % | $ | 79,164 | 4.50 | % | $ | 101,155 | 5.75 | % | N/A | N/A | ||||||||||||||
First Business Bank | 185,954 | 10.62 | 78,824 | 4.50 | 100,720 | 5.75 | $ | 113,857 | 6.50 | % | ||||||||||||||||||
Tier 1 leverage capital (to adjusted assets) | ||||||||||||||||||||||||||||
Consolidated | $ | 165,873 | 9.39 | % | $ | 70,654 | 4.00 | % | $ | 70,654 | 4.00 | % | N/A | N/A | ||||||||||||||
First Business Bank | 185,954 | 10.56 | 70,409 | 4.00 | 70,409 | 4.00 | $ | 88,011 | 5.00 | % |
Actual | Minimum Required for Capital Adequacy Purposes | For Capital Adequacy Purposes Plus Capital Conservation Buffer | Minimum Required to Be Well Capitalized Under Prompt Corrective Action Requirements | |||||||||||||||||||||||||
Amount | Ratio | Amount | Ratio | Amount | Ratio | Amount | Ratio | |||||||||||||||||||||
(Dollars in Thousands) | ||||||||||||||||||||||||||||
As of December 31, 2016 | ||||||||||||||||||||||||||||
Total capital (to risk-weighted assets) | ||||||||||||||||||||||||||||
Consolidated | $ | 204,117 | 11.74 | % | $ | 139,101 | 8.00 | % | $ | 149,968 | 8.625 | % | N/A | N/A | ||||||||||||||
First Business Bank | 147,811 | 11.55 | 102,362 | 8.00 | 110,360 | 8.625 | $ | 127,953 | 10.00 | % | ||||||||||||||||||
First Business Bank — Milwaukee | 24,347 | 11.02 | 17,680 | 8.00 | 19,062 | 8.625 | 22,101 | 10.00 | ||||||||||||||||||||
Alterra Bank | 31,699 | 13.27 | 19,106 | 8.00 | 20,599 | 8.625 | 23,882 | 10.00 | ||||||||||||||||||||
Tier 1 capital (to risk-weighted assets) | ||||||||||||||||||||||||||||
Consolidated | $ | 160,964 | 9.26 | % | $ | 104,326 | 6.00 | % | $ | 115,193 | 6.625 | % | N/A | N/A | ||||||||||||||
First Business Bank | 134,208 | 10.49 | 76,772 | 6.00 | 84,769 | 6.625 | $ | 102,362 | 8.00 | % | ||||||||||||||||||
First Business Bank — Milwaukee | 22,323 | 10.10 | 13,260 | 6.00 | 14,642 | 6.625 | 17,680 | 8.00 | ||||||||||||||||||||
Alterra Bank | 28,685 | 12.01 | 14,329 | 6.00 | 15,822 | 6.625 | 19,106 | 8.00 | ||||||||||||||||||||
Common equity tier 1 capital (to risk-weighted assets) | ||||||||||||||||||||||||||||
Consolidated | $ | 150,960 | 8.68 | % | $ | 78,244 | 4.50 | % | $ | 89,111 | 5.125 | % | N/A | N/A | ||||||||||||||
First Business Bank | 134,208 | 10.49 | 57,579 | 4.50 | 65,576 | 5.125 | $ | 83,170 | 6.50 | % | ||||||||||||||||||
First Business Bank — Milwaukee | 22,323 | 10.10 | 9,945 | 4.50 | 11,327 | 5.125 | 14,365 | 6.50 | ||||||||||||||||||||
Alterra Bank | 28,685 | 12.01 | 10,747 | 4.50 | 12,240 | 5.125 | 15,524 | 6.50 | ||||||||||||||||||||
Tier 1 leverage capital (to adjusted assets) | ||||||||||||||||||||||||||||
Consolidated | $ | 160,964 | 9.07 | % | $ | 70,985 | 4.00 | % | $ | 70,985 | 4.00 | % | N/A | N/A | ||||||||||||||
First Business Bank | 134,208 | 10.40 | 51,600 | 4.00 | 51,600 | 4.00 | $ | 64,500 | 5.00 | % | ||||||||||||||||||
First Business Bank — Milwaukee | 22,323 | 9.15 | 9,758 | 4.00 | 9,758 | 4.00 | 12,198 | 5.00 | ||||||||||||||||||||
Alterra Bank | 28,685 | 10.58 | 10,842 | 4.00 | 10,842 | 4.00 | 13,552 | 5.00 |
• | Competitive pressures among depository and other financial institutions nationally and in our markets. |
• | Adverse changes in the economy or business conditions, either nationally or in our markets. |
• | Increases in defaults by borrowers and other delinquencies. |
• | Our ability to manage growth effectively, including the successful expansion of our client support, administrative infrastructure and internal management systems. |
• | Fluctuations in interest rates and market prices. |
• | The consequences of continued bank acquisitions and mergers in our markets, resulting in fewer but much larger and financially stronger competitors. |
• | Changes in legislative or regulatory requirements applicable to us and our subsidiaries. |
• | Changes in tax requirements, including tax rate changes, new tax laws and revised tax law interpretations. |
• | Fraud, including client and system failure or breaches of our network security, including our internet banking activities. |
• | Failure to comply with the applicable SBA regulations in order to maintain the eligibility of the guaranteed portion of SBA loans. |
• | Total assets increased to $1.786 billion as of September 30, 2017 compared to $1.781 billion as of December 31, 2016. |
• | Net income for the three months ended September 30, 2017 was $2.6 million compared to net income of $2.7 million for the three months ended September 30, 2016. Net income for the nine months ended September 30, 2017 was $7.9 million compared to net income of $10.9 million for the nine months ended September 30, 2016. |
• | Diluted earnings per common share for the three months ended September 30, 2017 were $0.30 compared to diluted earnings per common share of $0.31 for the three months ended September 30, 2016. Diluted earnings per common share for the nine months ended September 30, 2017 were $0.90 compared to diluted earnings per common share of $1.26 for the nine months ended September 30, 2016. |
• | Annualized return on average assets (“ROAA”) and annualized return on average equity (“ROAE”) were 0.58% and 6.22%, respectively, for the three month period ended September 30, 2017, compared to 0.59% and 6.69%, respectively, for the same time period in 2016. ROAA and ROAE were 0.59% and 6.36%, respectively, for the nine month period ended September 30, 2017 compared to 0.80% and 9.26%, respectively, for the same time period in 2016. |
• | Trust and investment services fee income increased 21.2% to $1.7 million for the three months ended September 30, 2017 compared to $1.4 million for the three months ended September 30, 2016. For the nine months ended September 30, 2017, trust and investment services fee income increased 23.8% to $4.9 million compared to $4.0 million for the nine months ended September 30, 2016. |
• | Top line revenue, the sum of net interest income and non-interest income, increased 1.5% to $19.2 million for the three months ended September 30, 2017 compared to $18.9 million for the three months ended September 30, 2016. For the nine months ended September 30, 2017, top line revenue decreased 3.7% to $58.4 million compared to $60.6 million for the nine months ended September 30, 2016. |
• | Net interest margin increased two basis points to 3.52% for the three months ended September 30, 2017 compared to 3.50% for the three months ended September 30, 2016. Net interest margin was 3.56% for both the nine months ended September 30, 2017 and nine months ended September 30, 2016. |
• | Efficiency ratio was 66.56% for the three months ended September 30, 2017, compared to 63.63% for the three months ended September 30, 2016. For the nine months ended September 30, 2017 our efficiency ratio was 67.55% compared to 62.35% for the same time period in 2016. |
• | Provision for loan and lease losses was $1.5 million for the three months ended September 30, 2017 compared to $3.5 million for the same period in the prior year. Provision for loan and lease losses was $5.7 million for the nine months ended September 30, 2017 compared to $6.8 million for the same time period in 2016. |
• | SBA recourse provision was $1.3 million for the three months ended September 30, 2017, compared to $375,000 for the three months ended September 30, 2016. For the nine months ended September 30, 2017, SBA recourse provision was $2.1 million compared to $449,000 for the nine months ended September 30, 2016. |
• | Net charge-offs of $3.2 million represented an annualized 0.88% of average loans and leases for the three months ended September 30, 2017 compared to annualized net charge-offs of 0.44% for the three months ended September 30, 2016. Net charge-offs of $6.7 million represented an annualized 0.61% of average loans and leases for the nine months ended September 30, 2017 compared to annualized net charge-offs of 0.28% for the nine months ended September 30, 2016. |
• | Gross loans and leases receivable increased $16.0 million to $1.467 billion at September 30, 2017 from $1.451 billion at December 31, 2016. |
• | Allowance for loan and lease losses as a percentage of gross loans and leases was 1.36% at September 30, 2017 compared to 1.44% at December 31, 2016. |
• | Non-performing assets as a percentage of total assets was 2.01% at September 30, 2017 compared to 1.50% at December 31, 2016. |
• | Non-accrual loans increased by $8.0 million, or 31.9%, to $33.2 million at September 30, 2017 from $25.2 million at December 31, 2016. |
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||||||||
2017 | 2016 | Change | 2017 | 2016 | Change | |||||||||||||||||
(Dollars in Thousands) | ||||||||||||||||||||||
Net interest income | $ | 14,883 | $ | 15,295 | (2.7 | )% | $ | 45,250 | $ | 46,575 | (2.8 | )% | ||||||||||
Non-interest income | 4,339 | 3,640 | 19.2 | 13,140 | 14,057 | (6.5 | ) | |||||||||||||||
Total top line revenue | $ | 19,222 | $ | 18,935 | 1.5 | $ | 58,390 | $ | 60,632 | (3.7 | ) |
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||||||||||||||||
2017 | 2016 | $ Change | % Change | 2017 | 2016 | $ Change | % Change | |||||||||||||||||||||||
(Dollars in Thousands) | ||||||||||||||||||||||||||||||
Total non-interest expense | $ | 14,231 | $ | 15,753 | $ | (1,522 | ) | (9.7 | )% | $ | 42,012 | $ | 41,910 | $ | 102 | 0.2 | % | |||||||||||||
Less: | ||||||||||||||||||||||||||||||
Net loss on foreclosed properties | — | — | — | NM | — | 93 | (93 | ) | (100.0 | ) | ||||||||||||||||||||
Amortization of other intangible assets | 14 | 16 | (2 | ) | (12.5 | ) | 41 | 48 | (7 | ) | (14.6 | ) | ||||||||||||||||||
SBA recourse provision | 1,315 | 375 | 940 | 250.7 | 2,095 | 449 | 1,646 | 366.6 | ||||||||||||||||||||||
Impairment of tax credit investments | 112 | 3,314 | (3,202 | ) | (96.6 | ) | 338 | 3,520 | (3,182 | ) | (90.4 | ) | ||||||||||||||||||
Deconversion fees | — | — | — | NM | 101 | — | 101 | NM | ||||||||||||||||||||||
Total adjusted operating expense | $ | 12,790 | $ | 12,048 | $ | 742 | 6.2 | $ | 39,437 | $ | 37,800 | $ | 1,637 | 4.3 | ||||||||||||||||
Net interest income | $ | 14,883 | $ | 15,295 | $ | (412 | ) | (2.7 | ) | $ | 45,250 | $ | 46,575 | (1,325 | ) | (2.8 | ) | |||||||||||||
Total non-interest income | 4,339 | 3,640 | 699 | 19.2 | 13,140 | 14,057 | (917 | ) | (6.5 | ) | ||||||||||||||||||||
Less: | ||||||||||||||||||||||||||||||
Gain on sale of securities | 5 | — | 5 | NM | 6 | 7 | (1 | ) | (14.3 | ) | ||||||||||||||||||||
Total operating revenue | $ | 19,217 | $ | 18,935 | $ | 282 | 1.5 | $ | 58,384 | $ | 60,625 | $ | (2,241 | ) | (3.7 | ) | ||||||||||||||
Efficiency ratio | 66.56 | % | 63.63 | % | 67.55 | % | 62.35 | % |
Increase (Decrease) for the Three Months Ended September 30, | Increase (Decrease) for the Nine Months Ended September 30, | |||||||||||||||||||||||
2017 Compared to 2016 | 2017 Compared to 2016 | |||||||||||||||||||||||
Rate | Volume | Net | Rate | Volume | Net | |||||||||||||||||||
(In Thousands) | ||||||||||||||||||||||||
Interest-earning assets | ||||||||||||||||||||||||
Commercial real estate and other mortgage loans(1) | $ | 45 | $ | 221 | $ | 266 | $ | (1,283 | ) | $ | 777 | $ | (506 | ) | ||||||||||
Commercial and industrial loans(1) | (309 | ) | (155 | ) | (464 | ) | (290 | ) | (679 | ) | (969 | ) | ||||||||||||
Direct financing leases | (20 | ) | (18 | ) | (38 | ) | (56 | ) | (51 | ) | (107 | ) | ||||||||||||
Consumer and other loans | (135 | ) | 41 | (94 | ) | (161 | ) | 75 | (86 | ) | ||||||||||||||
Total loans and leases receivable | (419 | ) | 89 | (330 | ) | (1,790 | ) | 122 | (1,668 | ) | ||||||||||||||
Mortgage-related securities | 99 | (53 | ) | 46 | 183 | (59 | ) | 124 | ||||||||||||||||
Other investment securities | 19 | 8 | 27 | 38 | 61 | 99 | ||||||||||||||||||
FHLB and FRB Stock | (40 | ) | 44 | 4 | (15 | ) | 27 | 12 | ||||||||||||||||
Short-term investments | 118 | (129 | ) | (11 | ) | 292 | (349 | ) | (57 | ) | ||||||||||||||
Total net change in income on interest-earning assets | (223 | ) | (41 | ) | (264 | ) | (1,292 | ) | (198 | ) | (1,490 | ) | ||||||||||||
Interest-bearing liabilities | ||||||||||||||||||||||||
Transaction accounts | 207 | 44 | 251 | 490 | 122 | 612 | ||||||||||||||||||
Money market accounts | (6 | ) | (52 | ) | (58 | ) | (256 | ) | (178 | ) | (434 | ) | ||||||||||||
Certificates of deposit | 13 | (15 | ) | (2 | ) | 51 | (81 | ) | (30 | ) | ||||||||||||||
Wholesale deposits | 148 | (501 | ) | (353 | ) | 234 | (1,303 | ) | (1,069 | ) | ||||||||||||||
Total deposits | 362 | (524 | ) | (162 | ) | 519 | (1,440 | ) | (921 | ) | ||||||||||||||
FHLB advances | (7 | ) | 340 | 333 | 18 | 698 | 716 | |||||||||||||||||
Other borrowings | (14 | ) | (10 | ) | (24 | ) | 152 | (108 | ) | 44 | ||||||||||||||
Junior subordinated notes | 1 | — | 1 | 5 | (8 | ) | (3 | ) | ||||||||||||||||
Total net change in expense on interest-bearing liabilities | 342 | (194 | ) | 148 | 694 | (858 | ) | (164 | ) | |||||||||||||||
Net change in net interest income | $ | (565 | ) | $ | 153 | $ | (412 | ) | $ | (1,986 | ) | $ | 660 | $ | (1,326 | ) |
(1) | Includes loans held for sale. |
For the Three Months Ended September 30, | ||||||||||||||||||||||
2017 | 2016 | |||||||||||||||||||||
Average Balance | Interest | Average Yield/Rate(5) | Average Balance | Interest | Average Yield/Rate(5) | |||||||||||||||||
(Dollars in Thousands) | ||||||||||||||||||||||
Interest-earning assets | ||||||||||||||||||||||
Commercial real estate and other mortgage loans(1) | $ | 966,711 | $ | 10,922 | 4.52 | % | $ | 947,167 | $ | 10,656 | 4.50 | % | ||||||||||
Commercial and industrial loans(1) | 448,955 | 6,187 | 5.51 | 459,871 | 6,651 | 5.79 | ||||||||||||||||
Direct financing leases(1) | 28,648 | 303 | 4.23 | 30,231 | 341 | 4.51 | ||||||||||||||||
Consumer and other loans(1) | 26,577 | 274 | 4.12 | 23,662 | 368 | 6.22 | ||||||||||||||||
Total loans and leases receivable(1) | 1,470,891 | 17,686 | 4.81 | 1,460,931 | 18,016 | 4.93 | ||||||||||||||||
Mortgage-related securities(2) | 136,330 | 613 | 1.80 | 149,414 | 567 | 1.52 | ||||||||||||||||
Other investment securities(3) | 36,106 | 158 | 1.75 | 34,042 | 131 | 1.54 | ||||||||||||||||
FHLB and FRB stock | 3,949 | 25 | 2.53 | 2,163 | 21 | 3.88 | ||||||||||||||||
Short-term investments | 44,478 | 152 | 1.37 | 103,549 | 163 | 0.63 | ||||||||||||||||
Total interest-earning assets | 1,691,754 | 18,634 | 4.41 | 1,750,099 | 18,898 | 4.32 | ||||||||||||||||
Non-interest-earning assets | 85,768 | 67,884 | ||||||||||||||||||||
Total assets | $ | 1,777,522 | $ | 1,817,983 | ||||||||||||||||||
Interest-bearing liabilities | ||||||||||||||||||||||
Transaction accounts | $ | 240,035 | 364 | 0.61 | $ | 182,743 | 113 | 0.25 | ||||||||||||||
Money market accounts | 588,811 | 700 | 0.48 | 632,415 | 758 | 0.48 | ||||||||||||||||
Certificates of deposit | 57,716 | 150 | 1.04 | 63,581 | 152 | 0.96 | ||||||||||||||||
Wholesale deposits | 346,641 | 1,494 | 1.72 | 465,273 | 1,847 | 1.59 | ||||||||||||||||
Total interest-bearing deposits | 1,233,203 | 2,708 | 0.88 | 1,344,012 | 2,870 | 0.85 | ||||||||||||||||
FHLB advances | 103,401 | 351 | 1.36 | 4,991 | 18 | 1.44 | ||||||||||||||||
Other borrowings(4) | 24,400 | 411 | 6.74 | 24,976 | 435 | 6.97 | ||||||||||||||||
Junior subordinated notes | 10,013 | 281 | 11.23 | 9,998 | 280 | 11.20 | ||||||||||||||||
Total interest-bearing liabilities | 1,371,017 | 3,751 | 1.09 | 1,383,977 | 3,603 | 1.04 | ||||||||||||||||
Non-interest-bearing demand deposit accounts | 224,961 | 263,627 | ||||||||||||||||||||
Other non-interest-bearing liabilities | 15,376 | 11,098 | ||||||||||||||||||||
Total liabilities | 1,611,354 | 1,658,702 | ||||||||||||||||||||
Stockholders’ equity | 166,168 | 159,281 | ||||||||||||||||||||
Total liabilities and stockholders’ equity | $ | 1,777,522 | $ | 1,817,983 | ||||||||||||||||||
Net interest income | $ | 14,883 | $ | 15,295 | ||||||||||||||||||
Interest rate spread | 3.32 | % | 3.28 | % | ||||||||||||||||||
Net interest-earning assets | $ | 320,737 | $ | 366,122 | ||||||||||||||||||
Net interest margin | 3.52 | % | 3.50 | % | ||||||||||||||||||
Average interest-earning assets to average interest-bearing liabilities | 123.39 | % | 126.45 | % | ||||||||||||||||||
Return on average assets(5) | 0.58 | 0.59 | ||||||||||||||||||||
Return on average equity(5) | 6.22 | 6.69 | ||||||||||||||||||||
Average equity to average assets | 9.35 | 8.76 | ||||||||||||||||||||
Non-interest expense to average assets(5) | 3.20 | 3.47 |
(1) | The average balances of loans and leases include non-performing loans and leases and loans held for sale. Interest income related to non-performing loans and leases is recognized when collected. Interest income includes net loan fees collected in lieu of interest. |
(2) | Includes amortized cost basis of assets available-for-sale and held-to-maturity. |
(3) | Yields on tax-exempt municipal obligations are not presented on a tax-equivalent basis in this table. |
(4) | Average rate of other borrowings reflects the cost of prepaying a secured borrowing during the second quarter of 2017. |
(5) | Represents annualized yields/rates. |
For the Nine Months Ended September 30, | ||||||||||||||||||||||
2017 | 2016 | |||||||||||||||||||||
Average Balance | Interest | Average Yield/Rate(5) | Average Balance | Interest | Average Yield/Rate(5) | |||||||||||||||||
(Dollars in Thousands) | ||||||||||||||||||||||
Interest-earning assets | ||||||||||||||||||||||
Commercial real estate and other mortgage loans(1) | $ | 957,408 | $ | 31,861 | 4.44 | % | $ | 934,615 | $ | 32,366 | 4.62 | % | ||||||||||
Commercial and industrial loans(1) | 451,352 | 19,863 | 5.87 | 466,729 | 20,833 | 5.95 | ||||||||||||||||
Direct financing leases(1) | 29,161 | 932 | 4.26 | 30,683 | 1,039 | 4.51 | ||||||||||||||||
Consumer and other loans(1) | 27,780 | 837 | 4.02 | 25,581 | 923 | 4.81 | ||||||||||||||||
Total loans and leases receivable(1) | 1,465,701 | 53,493 | 4.87 | 1,457,608 | 55,161 | 5.04 | ||||||||||||||||
Mortgage-related securities(2) | 140,705 | 1,845 | 1.75 | 145,599 | 1,721 | 1.58 | ||||||||||||||||
Other investment securities(3) | 37,466 | 480 | 1.71 | 32,518 | 381 | 1.56 | ||||||||||||||||
FHLB and FRB stock | 3,779 | 73 | 2.58 | 2,482 | 61 | 3.28 | ||||||||||||||||
Short-term investments | 48,375 | 415 | 1.14 | 107,369 | 472 | 0.59 | ||||||||||||||||
Total interest-earning assets | 1,696,026 | 56,306 | 4.43 | 1,745,576 | 57,796 | 4.41 | ||||||||||||||||
Non-interest-earning assets | 82,628 | 75,969 | ||||||||||||||||||||
Total assets | $ | 1,778,654 | $ | 1,821,545 | ||||||||||||||||||
Interest-bearing liabilities | ||||||||||||||||||||||
Transaction accounts | $ | 221,526 | 885 | 0.53 | $ | 164,278 | 273 | 0.22 | ||||||||||||||
Money market accounts | 601,455 | 2,019 | 0.45 | 650,864 | 2,453 | 0.50 | ||||||||||||||||
Certificates of deposit | 55,888 | 415 | 0.99 | 67,440 | 446 | 0.88 | ||||||||||||||||
Wholesale deposits | 374,083 | 4,720 | 1.68 | 478,038 | 5,789 | 1.61 | ||||||||||||||||
Total interest-bearing deposits | 1,252,952 | 8,039 | 0.86 | 1,360,620 | 8,961 | 0.88 | ||||||||||||||||
FHLB advances | 83,987 | 784 | 1.24 | 8,941 | 68 | 1.01 | ||||||||||||||||
Other borrowings(4) | 24,933 | 1,401 | 7.49 | 26,982 | 1,357 | 6.71 | ||||||||||||||||
Junior subordinated notes | 10,009 | 832 | 11.08 | 10,101 | 835 | 11.02 | ||||||||||||||||
Total interest-bearing liabilities | 1,371,881 | 11,056 | 1.07 | 1,406,644 | 11,221 | 1.06 | ||||||||||||||||
Non-interest-bearing demand deposit accounts | 228,231 | 246,238 | ||||||||||||||||||||
Other non-interest-bearing liabilities | 13,726 | 11,126 | ||||||||||||||||||||
Total liabilities | 1,613,838 | 1,664,008 | ||||||||||||||||||||
Stockholders’ equity | 164,816 | 157,537 | ||||||||||||||||||||
Total liabilities and stockholders’ equity | $ | 1,778,654 | $ | 1,821,545 | ||||||||||||||||||
Net interest income | $ | 45,250 | $ | 46,575 | ||||||||||||||||||
Interest rate spread | 3.36 | % | 3.35 | % | ||||||||||||||||||
Net interest-earning assets | $ | 324,145 | $ | 338,932 | ||||||||||||||||||
Net interest margin | 3.56 | % | 3.56 | % | ||||||||||||||||||
Average interest-earning assets to average interest-bearing liabilities | 123.63 | % | 124.10 | % | ||||||||||||||||||
Return on average assets(5) | 0.59 | 0.80 | ||||||||||||||||||||
Return on average equity(5) | 6.36 | 9.26 | ||||||||||||||||||||
Average equity to average assets | 9.27 | 8.65 | ||||||||||||||||||||
Non-interest expense to average assets(5) | 3.15 | 3.07 |
(1) | The average balances of loans and leases include non-performing loans and leases and loans held for sale. Interest income related to non-performing loans and leases is recognized when collected. Interest income includes net loan fees collected in lieu of interest. |
(2) | Includes amortized cost basis of assets available-for-sale and held-to-maturity. |
(3) | Yields on tax-exempt municipal obligations are not presented on a tax-equivalent basis in this table. |
(4) | Average rate of other borrowings reflects the cost of prepaying a secured borrowing during the second quarter of 2017. |
(5) | Represents annualized yields/rates. |
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||||||||||||||||
2017 | 2016 | $ Change | % Change | 2017 | 2016 | $ Change | % Change | ||||||||||||||||||||||
(In Thousands) | |||||||||||||||||||||||||||||
Trust and investment services fee income | $ | 1,653 | $ | 1,364 | $ | 289 | 21.2 | % | 4,930 | 3,981 | $ | 949 | 23.8 | % | |||||||||||||||
Gain on sale of SBA loans | 606 | 347 | 259 | 74.6 | 1,501 | 3,854 | (2,353 | ) | (61.1 | ) | |||||||||||||||||||
Gain on sale of residential mortgage loans | — | 198 | (198 | ) | (100.0 | ) | 26 | 540 | (514 | ) | (95.2 | ) | |||||||||||||||||
Service charges on deposits | 756 | 772 | (16 | ) | (2.1 | ) | 2,287 | 2,247 | 40 | 1.8 | |||||||||||||||||||
Loan fees | 391 | 506 | (115 | ) | (22.7 | ) | 1,525 | 1,791 | (266 | ) | (14.9 | ) | |||||||||||||||||
Increase in cash surrender value of bank-owned life insurance | 314 | 244 | 70 | 28.7 | 940 | 730 | 210 | 28.8 | |||||||||||||||||||||
Other non-interest income | 619 | 209 | 410 | 196.2 | 1,931 | 914 | 1,017 | 111.3 | |||||||||||||||||||||
Total non-interest income | $ | 4,339 | $ | 3,640 | $ | 699 | 19.2 | $ | 13,140 | $ | 14,057 | $ | (917 | ) | (6.5 | ) | |||||||||||||
Fee income ratio(1) | 22.6 | % | 19.2 | % | 22.5 | % | 23.2 | % |
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||||||||||||||||
2017 | 2016 | $ Change | % Change | 2017 | 2016 | $ Change | % Change | ||||||||||||||||||||||
(Dollars in Thousands) | |||||||||||||||||||||||||||||
Compensation | $ | 7,645 | $ | 7,637 | $ | 8 | 0.1 | % | $ | 24,710 | $ | 24,454 | $ | 256 | 1.0 | % | |||||||||||||
Occupancy | 527 | 530 | (3 | ) | (0.6 | ) | 1,521 | 1,538 | (17 | ) | (1.1 | ) | |||||||||||||||||
Professional fees | 995 | 1,065 | (70 | ) | (6.6 | ) | 3,046 | 2,888 | 158 | 5.5 | |||||||||||||||||||
Data processing | 592 | 623 | (31 | ) | (5.0 | ) | 1,810 | 1,971 | (161 | ) | (8.2 | ) | |||||||||||||||||
Marketing | 594 | 528 | 66 | 12.5 | 1,546 | 1,710 | (164 | ) | (9.6 | ) | |||||||||||||||||||
Equipment | 285 | 292 | (7 | ) | (2.4 | ) | 868 | 913 | (45 | ) | (4.9 | ) | |||||||||||||||||
Computer software | 715 | 539 | 176 | 32.7 | 2,037 | 1,607 | 430 | 26.8 | |||||||||||||||||||||
FDIC insurance | 320 | 444 | (124 | ) | (27.9 | ) | 1,081 | 989 | 92 | 9.3 | |||||||||||||||||||
Collateral liquidation costs | 371 | 89 | 282 | 316.9 | 556 | 204 | 352 | 172.5 | |||||||||||||||||||||
Net loss on foreclosed properties | — | — | — | NM | — | 93 | (93 | ) | (100.0 | ) | |||||||||||||||||||
Impairment on tax credit investments | 112 | 3,314 | (3,202 | ) | (96.6 | ) | 338 | 3,520 | (3,182 | ) | (90.4 | ) | |||||||||||||||||
SBA recourse provision | 1,315 | 375 | 940 | 250.7 | 2,095 | 449 | 1,646 | 366.6 | |||||||||||||||||||||
Other non-interest expense | 760 | 317 | 443 | 139.7 | 2,404 | 1,574 | 830 | 52.7 | |||||||||||||||||||||
Total non-interest expense | $ | 14,231 | $ | 15,753 | $ | (1,522 | ) | (9.7 | ) | $ | 42,012 | $ | 41,910 | $ | 102 | 0.2 | |||||||||||||
Total adjusted operating expense (1) | $ | 12,790 | $ | 12,048 | $ | 39,437 | $ | 37,800 | |||||||||||||||||||||
Compensation expense to total adjusted operating expense | 59.77 | % | 63.39 | % | 62.66 | % | 64.69 | % | |||||||||||||||||||||
Full-time equivalent employees | 251 | 263 |
(1) | Total adjusted operating expense excludes the impact of discrete items as previously defined in the non-GAAP efficiency ratio calculation. |
September 30, 2017 | December 31, 2016 | |||||||
(Dollars in Thousands) | ||||||||
Non-accrual loans and leases | ||||||||
Commercial real estate: | ||||||||
Commercial real estate - owner occupied | $ | 7,080 | $ | 2,223 | ||||
Commercial real estate - non-owner occupied | 1,826 | 1,609 | ||||||
Land development | 2,770 | 3,440 | ||||||
Construction | 5,354 | 2,918 | ||||||
Multi-family | — | — | ||||||
1-4 family | 1,864 | 1,937 | ||||||
Total non-accrual commercial real estate | 18,894 | 12,127 | ||||||
Commercial and industrial | 13,957 | 12,463 | ||||||
Direct financing leases, net | — | — | ||||||
Consumer and other: | ||||||||
Home equity and second mortgages | — | — | ||||||
Other | 381 | 604 | ||||||
Total non-accrual consumer and other loans | 381 | 604 | ||||||
Total non-accrual loans and leases | 33,232 | 25,194 | ||||||
Foreclosed properties, net | 2,585 | 1,472 | ||||||
Total non-performing assets | 35,817 | 26,666 | ||||||
Performing troubled debt restructurings | 275 | 717 | ||||||
Total impaired assets | $ | 36,092 | $ | 27,383 | ||||
Total non-accrual loans and leases to gross loans and leases | 2.26 | % | 1.74 | % | ||||
Total non-performing assets to gross loans and leases plus foreclosed properties, net | 2.44 | 1.83 | ||||||
Total non-performing assets to total assets | 2.01 | 1.50 | ||||||
Allowance for loan and lease losses to gross loans and leases | 1.36 | 1.44 | ||||||
Allowance for loan and lease losses to non-accrual loans and leases | 59.95 | 83.00 |
As of and for the Nine Months Ended September 30, | As of and for the Year Ended December 31, | |||||||||||
2017 | 2016 | 2016 | ||||||||||
(In Thousands) | ||||||||||||
Impaired loans and leases with no impairment reserves required | $ | 17,972 | $ | 15,829 | $ | 11,345 | ||||||
Impaired loans and leases with impairment reserves required | 15,535 | 10,615 | 14,566 | |||||||||
Total impaired loans and leases | 33,507 | 26,444 | 25,911 | |||||||||
Less: | ||||||||||||
Impairment reserve (included in allowance for loan and lease losses) | 5,790 | 4,636 | 5,599 | |||||||||
Net impaired loans and leases | $ | 27,717 | $ | 21,808 | $ | 20,312 | ||||||
Average impaired loans and leases | $ | 34,871 | $ | 21,103 | $ | 22,986 | ||||||
Foregone interest income attributable to impaired loans and leases | $ | 1,969 | $ | 1,059 | $ | 1,617 | ||||||
Less: Interest income recognized on impaired loans and leases | — | 373 | 614 | |||||||||
Net foregone interest income on impaired loans and leases | $ | 1,969 | $ | 686 | $ | 1,003 |
(In Thousands) | |||
Foreclosed properties as of December 31, 2016 | $ | 1,472 | |
Premises and equipment transferred to foreclosed properties | 1,113 | ||
Foreclosed properties as of September 30, 2017 | $ | 2,585 |
As of and for the Three Months Ended September 30, | As of and for the Nine Months Ended September 30, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
(Dollars in Thousands) | ||||||||||||||||
Allowance at beginning of period | $ | 21,677 | $ | 18,154 | $ | 20,912 | $ | 16,316 | ||||||||
Charge-offs: | ||||||||||||||||
Commercial real estate: | ||||||||||||||||
Commercial real estate — owner occupied | — | — | (9 | ) | (41 | ) | ||||||||||
Commercial real estate — non-owner occupied | — | — | (80 | ) | — | |||||||||||
Construction and land development | — | (250 | ) | — | (948 | ) | ||||||||||
Multi-family | — | — | — | — | ||||||||||||
1-4 family | (8 | ) | (9 | ) | (37 | ) | (205 | ) | ||||||||
Commercial and industrial | (3,217 | ) | (1,396 | ) | (6,978 | ) | (2,048 | ) | ||||||||
Direct financing leases | — | — | — | — | ||||||||||||
Consumer and other: | ||||||||||||||||
Home equity and second mortgages | — | — | — | — | ||||||||||||
Other | (5 | ) | (1 | ) | (92 | ) | (8 | ) | ||||||||
Total charge-offs | (3,230 | ) | (1,656 | ) | (7,196 | ) | (3,250 | ) | ||||||||
Recoveries: | ||||||||||||||||
Commercial real estate: | ||||||||||||||||
Commercial real estate — owner occupied | — | — | 42 | — | ||||||||||||
Commercial real estate — non-owner occupied | 1 | 1 | 2 | 74 | ||||||||||||
Construction and land development | — | 28 | 101 | 28 | ||||||||||||
Multi-family | — | — | — | — | ||||||||||||
1-4 family | 1 | 2 | 7 | 68 | ||||||||||||
Commercial and industrial | 2 | — | 314 | 2 | ||||||||||||
Direct financing leases | — | — | — | — | ||||||||||||
Consumer and other: | ||||||||||||||||
Home equity and second mortgages | 1 | 1 | 2 | 3 | ||||||||||||
Other | — | — | 40 | 2 | ||||||||||||
Total recoveries | 5 | 32 | 508 | 177 | ||||||||||||
Net charge-offs | (3,225 | ) | (1,624 | ) | (6,688 | ) | (3,073 | ) | ||||||||
Provision for loan and lease losses | 1,471 | 3,537 | 5,699 | 6,824 | ||||||||||||
Allowance at end of period | $ | 19,923 | $ | 20,067 | $ | 19,923 | $ | 20,067 | ||||||||
Annualized net charge-offs as a % of average gross loans and leases | 0.88 | % | 0.44 | % | 0.61 | % | 0.28 | % |
• | the behavior of interest rates and pricing spreads; |
• | the changes in product balances; and |
• | the behavior of loan and deposit clients in different rate environments. |
(a) | None. |
(b) | Not applicable. |
(c) | None. |
31.1 | |||
31.2 | |||
32 | |||
101 | The following financial information from First Business Financial Services, Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2017, formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Balance Sheets as of September 30, 2017 and December 31, 2016, (ii) Consolidated Statements of Income for the three and nine months ended September 30, 2017 and 2016, (iii) Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2017 and 2016, (iv) Consolidated Statements of Changes in Stockholders’ Equity for the nine months ended September 30, 2017 and 2016, (v) Consolidated Statements of Cash Flows for the nine months ended September 30, 2017 and 2016, and (vi) the Notes to Unaudited Consolidated Financial Statements |
FIRST BUSINESS FINANCIAL SERVICES, INC. | |
October 27, 2017 | /s/ Corey A. Chambas |
Corey A. Chambas | |
Chief Executive Officer | |
October 27, 2017 | /s/ Edward G. Sloane, Jr. |
Edward G. Sloane, Jr. | |
Chief Financial Officer | |
(principal financial officer) |
1. | I have reviewed this Quarterly Report on Form 10-Q of First Business Financial Services, Inc.; |
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. | Any 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. |
/s/ Corey A. Chambas | |
Corey A. Chambas | |
Chief Executive Officer | |
October 27, 2017 |
1. | I have reviewed this Quarterly Report on Form 10-Q of First Business Financial Services, Inc.; |
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. | Any 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. |
/s/ Edward G. Sloane, Jr. | |
Edward G. Sloane, Jr. | |
Chief Financial Officer | |
October 27, 2017 |
/s/ Corey A. Chambas | |
Corey A. Chambas | |
Chief Executive Officer | |
October 27, 2017 | |
/s/ Edward G. Sloane, Jr. | |
Edward G. Sloane, Jr. | |
Chief Financial Officer | |
October 27, 2017 |
Document and Entity Information - shares |
9 Months Ended | |
---|---|---|
Sep. 30, 2017 |
Oct. 20, 2017 |
|
Document and Entity Information [Abstract] | ||
Entity Registrant Name | First Business Financial Services, Inc. | |
Entity Central Index Key | 0001521951 | |
Current Fiscal Year End Date | --12-31 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2017 | |
Document Fiscal Year Focus | 2017 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 8,759,673 |
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands |
Sep. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Consolidated Balance Sheets - Parenthetical [Abstract] | ||
Allowance for loan and lease losses | $ 19,923 | $ 20,912 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 2,500,000 | 2,500,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 25,000,000 | 25,000,000 |
Common stock, shares issued | 9,016,345 | 8,959,239 |
Common stock, shares outstanding | 8,758,923 | 8,715,856 |
Treasury stock, shares | 257,422 | 243,383 |
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 2,584 | $ 2,665 | $ 7,867 | $ 10,941 |
Other comprehensive income, before tax | ||||
Net unrealized securities gains arising during the period | 172 | 81 | 199 | 1,317 |
Amortization of net unrealized losses transferred from available-for-sale | 25 | 41 | 79 | 124 |
Income tax expense | (76) | (47) | (126) | (555) |
Total other comprehensive income | 121 | 75 | 152 | 886 |
Comprehensive income | $ 2,705 | $ 2,740 | $ 8,019 | $ 11,827 |
Consolidated Statements of Changes in Stockholders' Equity (Parenthetical) - $ / shares |
9 Months Ended | |
---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Common stock, cash dividends, per share, declared | $ 0.39 | $ 0.36 |
Retained earnings | ||
Common stock, cash dividends, per share, declared | $ 0.39 | $ 0.36 |
Nature of Operations and Summary of Significant Accounting Policies |
9 Months Ended |
---|---|
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations and Summary of Significant Accounting Policies | Nature of Operations and Summary of Significant Accounting Policies Nature of Operations. The accounting and reporting practices of First Business Financial Services, Inc. (the “Corporation”), through our wholly-owned subsidiary, First Business Bank (“FBB” or the “Bank”), has been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). FBB operates as a commercial banking institution primarily in the Wisconsin and greater Kansas City markets. FBB also offers trust and investment services through First Business Trust & Investments (“FBTI”), a division of FBB. The Bank provides a full range of financial services to businesses, business owners, executives, professionals and high net worth individuals. The Bank is subject to competition from other financial institutions and service providers and is also subject to state and federal regulations. FBB has the following wholly owned subsidiaries: First Business Capital Corp. (“FBCC”), First Madison Investment Corp. (“FMIC”), First Business Equipment Finance, LLC (“FBEF”), ABKC Real Estate, LLC (“ABKC”), Rimrock Road Investment Fund, LLC (“Rimrock Road”), BOC Investment, LLC (“BOC”), Mitchell Street Apartments Investment, LLC (“Mitchell Street”) and FBB Tax Credit Investment LLC (“FBB Tax Credit”). FMIC is located in and was formed under the laws of the state of Nevada. Basis of Presentation. The accompanying unaudited Consolidated Financial Statements were prepared in accordance with GAAP and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with the Corporation’s Consolidated Financial Statements and footnotes thereto included in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2016. The unaudited Consolidated Financial Statements include the accounts of the Corporation and its wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. In accordance with the provisions of Accounting Standards Codification (“ASC”) Topic 810, the Corporation’s ownership interest in FBFS Statutory Trust II (“Trust II”) has not been consolidated into the financial statements. Management of the Corporation is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements as well as reported amounts of revenues and expenses during the reporting period. Actual results could differ significantly from those estimates. Material estimates that could significantly change in the near-term include the value of securities, level of the allowance for loan and lease losses, lease residuals, property under operating leases, goodwill, level of the Small Business Administration (“SBA”) recourse reserve and income taxes. The results of operations for the nine month period ended September 30, 2017 are not necessarily indicative of results that may be expected for any other interim period or the entire fiscal year ending December 31, 2017. Certain amounts in prior periods may have been reclassified to conform to the current presentation. Subsequent events have been evaluated through the date of the issuance of the unaudited Consolidated Financial Statements. No significant subsequent events have occurred through this date requiring adjustment to the financial statements or disclosures. The Corporation has not changed its significant accounting and reporting policies from those disclosed in the Corporation’s Form 10-K for the year ended December 31, 2016. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” with an original effective date for annual reporting periods beginning after December 15, 2016. The ASU is a converged standard between the FASB and the IASB that provides a single comprehensive revenue recognition model for all contracts with customers across transactions and industries. The primary objective of the ASU is revenue recognition that represents the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. In August 2015, the FASB issued ASU No. 2015-14, which defers the effective date of ASU 2014-09 to annual and interim reporting periods in fiscal years beginning after December 15, 2017. Earlier application is permitted only as of annual and interim reporting periods in fiscal years beginning after December 15, 2016. In March 2016, the FASB issued ASU No. 2016-08, “Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net.” The ASU intends to improve the operability and understandability of the implementation guidance of ASU 2014-09 on principal versus agent considerations. In April, May and December 2016, the FASB also issued ASU No. 2016-10, No. 2016-12 and No. 2016-20, respectively, related to Topic 606. The amendments do not change the core principles of the previously issued guidance, but instead further clarify and provide implementation guidance for certain aspects of the original ASU. The Corporation intends to adopt the accounting standards during the first quarter of 2018, as required. The Corporation has conducted its initial assessment and evaluated contracts to assess and quantify accounting methodology changes resulting from the adoption of this standard. The adoption of this accounting standard is not expected to have a material impact on the Corporation's consolidated financial statements. The FASB continues to release new accounting guidance related to the adoption of this standard, which could impact the Corporation's initial assessment and may change the conclusions reached as to the application of this new guidance. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842).” The ASU intends to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities and disclosing key information about leasing arrangements. The ASU will require lessees to recognize the following for all leases (with the exception of short-term leases) at the commencement date: (1) a lease liability, which is a lessees’ obligation to make lease payments arising from a lease, measured on a discounted basis; and (2) a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Under the new guidance, lessor accounting is largely unchanged. Certain targeted improvements were made to align, where necessary, lessor accounting with the lessee accounting model and Topic 606, Revenue from Contracts with Customers. The new lease guidance simplifies the accounting for sale and leaseback transactions primarily because lessees must recognize lease assets and lease liabilities. Lessees (for capital and operating leases) and lessors (for sales-type, direct financing, and operating leases) must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The modified retrospective approach would not require any transition accounting for leases that expired before the earliest comparative period presented. The ASU is effective for public companies for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. The Corporation intends to adopt the accounting standard during the first quarter of 2019, as required, and is currently evaluating the impact on its results of operations, financial position and liquidity. In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments- Credit Losses (Topic 326).” The ASU replaces the incurred loss impairment methodology for recognizing credit losses with a methodology that reflects all expected credit losses. The ASU also requires consideration of a broader range of information to inform credit loss estimates, including such factors as past events, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. The amendments affect loans, debt securities, trade receivables, net investments in leases, off-balance-sheet credit exposures, and any other financial asset not excluded from the scope that have the contractual right to receive cash. Entities will apply the amendments in the ASU through a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. The ASU is effective for public companies for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted as of the fiscal years beginning after December 15, 2018. The Corporation intends to adopt the accounting standard during the first quarter of 2020, as required, and is currently evaluating the impact on its results of operations, financial position and liquidity. In May 2017, the FASB issued ASU No. 2017-09, “Compensation- Stock Compensation (Topic 718).” The ASU provides clarity about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting. The ASU is effective for all entities for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early adoption is permitted. The Corporation is in the process of evaluating the impact of this standard but does not expect this standard to have a material impact on its results of operations, financial position and liquidity. In August 2017, the FASB issued ASU No. 2017-12, “Derivatives and Hedging (Topic 815).” The ASU intends to better align an entity’s risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. It also expands and refines hedge accounting for both nonfinancial and financial risk components and aligns the recognition and presentation of the effects of the hedging instrument and the hedged item. The ASU is effective for public companies for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. The Corporation is in the process of evaluating the impact of this standard but does not expect this standard to have a material impact on its results of operations, financial position and liquidity. |
Earnings Per Common Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Common Share | Earnings per Common Share Earnings per common share are computed using the two-class method. Basic earnings per common share are computed by dividing net income allocated to common shares by the weighted average number of shares outstanding during the applicable period, excluding outstanding participating securities. Participating securities include unvested restricted shares. Unvested restricted shares are considered participating securities because holders of these securities receive non-forfeitable dividends, or dividend equivalents, at the same rate as holders of the Corporation’s common stock. Diluted earnings per share are computed by dividing net income allocated to common shares, adjusted for reallocation of undistributed earnings of unvested restricted shares, by the weighted average number of shares determined for the basic earnings per common share computation plus the dilutive effect of common stock equivalents using the treasury stock method. There were no anti-dilutive employee share-based awards for the three and nine month periods ended September 30, 2017 and 2016.
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Share-Based Compensation |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-Based Compensation | Share-Based Compensation The Corporation adopted the 2012 Equity Incentive Plan (the “Plan”) during the quarter ended June 30, 2012. The Plan is administered by the Compensation Committee of the Board of Directors of the Corporation and provides for the grant of equity ownership opportunities through incentive stock options and nonqualified stock options, restricted stock, restricted stock units, dividend equivalent units and any other type of award permitted by the Plan. As of September 30, 2017, 217,475 shares were available for future grants under the Plan. Shares covered by awards that expire, terminate or lapse will again be available for the grant of awards under the Plan. The Corporation may issue new shares and shares from its treasury stock for shares delivered under the Plan. Restricted Stock Under the Plan, the Corporation may grant restricted stock to plan participants, subject to forfeiture upon the occurrence of certain events until the dates specified in the participant’s award agreement. While restricted stock is subject to forfeiture, with the exception of restricted stock units, which do not have voting rights and are provided dividend equivalents, restricted stock participants may exercise full voting rights and will receive all dividends and other distributions paid with respect to the restricted shares. The restricted stock granted under the Plan is typically subject to a vesting period. Compensation expense is recognized over the requisite service period of generally four years for the entire award on a straight-line basis. Upon vesting of restricted stock, the benefit of tax deductions in excess of recognized compensation expense is reflected as an income tax benefit in the unaudited Consolidated Statements of Income. Restricted stock activity for the year ended December 31, 2016 and the nine months ended September 30, 2017 was as follows:
As of September 30, 2017, the Corporation had $2.6 million of deferred unvested compensation expense, which the Corporation expects to recognize over a weighted-average period of approximately 3.03 years. For the three and nine months ended September 30, 2017 and 2016, share-based compensation expense related to restricted stock included in the unaudited Consolidated Statements of Income was as follows:
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Securities |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Securities | Securities The amortized cost and fair value of securities available-for-sale and the corresponding amounts of gross unrealized gains and losses recognized in accumulated other comprehensive income were as follows:
The amortized cost and fair value of securities held-to-maturity and the corresponding amounts of gross unrealized gains and losses were as follows:
U.S. Government agency obligations - government-sponsored enterprises represent securities issued by the Federal Home Loan Mortgage Corporation (“FHLMC”) and Federal National Mortgage Association (“FNMA”). Municipal obligations include securities issued by various municipalities located primarily within the State of Wisconsin and are primarily general obligation bonds that are tax-exempt in nature. Asset-backed securities represent securities issued by the Student Loan Marketing Association (“SLMA”) which are 97% guaranteed by the U.S. Government. Collateralized mortgage obligations - government issued represent securities guaranteed by the Government National Mortgage Association. Collateralized mortgage obligations - government-sponsored enterprises include securities guaranteed by the FHLMC and the FNMA. There were 14 sales of available-for-sale securities that occurred during the nine months ended September 30, 2017 and three sales of available-for-sale securities that occurred during the nine months ended September 30, 2016. At September 30, 2017 and December 31, 2016, securities with a fair value of $1.9 million and $22.4 million, respectively, were pledged to secure interest rate swap contracts, outstanding Federal Home Loan Bank (“FHLB”) advances and additional FHLB availability. The amortized cost and fair value of securities by contractual maturity at September 30, 2017 are shown below. Actual maturities may differ from contractual maturities because issuers have the right to call or prepay certain obligations with or without call or prepayment penalties.
The tables below show the Corporation’s gross unrealized losses and fair value of available-for-sale investments with unrealized losses, aggregated by investment category and length of time that individual investments were in a continuous loss position at September 30, 2017 and December 31, 2016. At September 30, 2017, the Corporation held 106 available-for-sale securities that were in an unrealized loss position. Such securities have not experienced credit rating downgrades; however, they have primarily declined in value due to the current interest rate environment. At September 30, 2017, the Corporation held 56 available-for-sale securities that had been in a continuous unrealized loss position for twelve months or greater. The Corporation has not specifically identified available-for-sale securities in a loss position that it intends to sell in the near term and does not believe that it will be required to sell any such securities. The Corporation reviews its securities on a quarterly basis to monitor its exposure to other-than-temporary impairment. Consideration is given to such factors as the length of time and extent to which the security has been in an unrealized loss position, changes in security ratings and an evaluation of the present value of expected future cash flows, if necessary. Based on the Corporation’s evaluation, it is expected that the Corporation will recover the entire amortized cost basis of each security. Accordingly, no other-than-temporary impairment was recorded in the unaudited Consolidated Statements of Income for the nine months ended September 30, 2017 and 2016. A summary of unrealized loss information for securities available-for-sale, categorized by security type and length of time for which the security has been in a continuous unrealized loss position, follows:
The tables below show the Corporation’s gross unrealized losses and fair value of held-to-maturity investments, aggregated by investment category and length of time that individual investments were in a continuous loss position at September 30, 2017 and December 31, 2016. At September 30, 2017, the Corporation held 14 held-to-maturity securities that were in an unrealized loss position. Such securities have not experienced credit rating downgrades; however, they have primarily declined in value due to the current interest rate environment. There were seven held-to-maturity securities that had been in a continuous loss position for twelve months or greater as of September 30, 2017. It is expected that the Corporation will recover the entire amortized cost basis of each held-to-maturity security based upon an evaluation of aforementioned factors. Accordingly, no other-than-temporary impairment was recorded in the unaudited Consolidated Statements of Income for the nine months ended September 30, 2017 and 2016. A summary of unrealized loss information for securities held-to-maturity, categorized by security type and length of time for which the security has been in a continuous unrealized loss position, follows:
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Loan and Lease Receivables, Impaired Loans and Leases and Allowance for Loan and Lease Losses |
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loan and Lease Receivables, Impaired Loans and Leases and Allowance for Loan and Lease Losses | Loan and Lease Receivables, Impaired Loans and Leases and Allowance for Loan and Lease Losses Loan and lease receivables consist of the following:
As of September 30, 2017 and December 31, 2016, the total amount of the Corporation’s ownership of SBA loans on the unaudited Consolidated Balance Sheets comprised of the following:
As of September 30, 2017 and December 31, 2016, $11.9 million and $5.5 million of loans in this portfolio were considered impaired, respectively. Loans transferred to third parties consist of the guaranteed portion of SBA loans which the Corporation sold in the secondary market, participation interests in other originated loans and residential real estate loans. The total principal amount of the guaranteed portion of SBA loans sold during the three months ended September 30, 2017 and 2016 was $6.3 million and $3.3 million, respectively. The total principal amount of the guaranteed portion of SBA loans sold during the nine months ended September 30, 2017 and 2016 was $15.5 million and $36.4 million, respectively. Each of the transfers of these financial assets met the qualifications for sale accounting, and therefore all of the loans transferred during the three and nine months ended September 30, 2017 and 2016 have been derecognized in the unaudited Consolidated Financial Statements. The guaranteed portion of SBA loans were transferred at their fair value and the related gain was recognized upon the transfer as non-interest income in the unaudited Consolidated Financial Statements. The total outstanding balance of sold SBA loans at September 30, 2017 and December 31, 2016 was $103.3 million and $105.1 million, respectively. The total principal amount of transferred participation interests in other originated commercial loans during the three months ended September 30, 2017 and 2016 was $9.0 million and $7.9 million, respectively. The total principal amount of transferred participation interests in other originated commercial loans during the nine months ended September 30, 2017 and 2016 was $17.0 million and $17.7 million, respectively, all of which were treated as sales and derecognized under the applicable accounting guidance at the time of transfer. No gain or loss was recognized on participation interests in other originated loans as they were transferred at or near the date of loan origination and the payments received for servicing the portion of the loans participated represents adequate compensation. The total outstanding balance of these transferred loans at September 30, 2017 and December 31, 2016 was $91.7 million and $102.7 million, respectively. As of September 30, 2017 and December 31, 2016, the total amount of the Corporation’s partial ownership of these transferred loans on the unaudited Consolidated Balance Sheets was $146.2 million and $106.1 million, respectively. No loans in this participation portfolio were considered impaired as of September 30, 2017 and December 31, 2016. The Corporation does not share in the participant’s portion of any potential charge-offs. The total amount of loan participations purchased on the unaudited Consolidated Balance Sheets as of September 30, 2017 and December 31, 2016 was $669,000 and $1.2 million, respectively. The Corporation also previously sold residential real estate loans, servicing released, in the secondary market. No residential real estate loans were sold during the three months ended September 30, 2017 and $8.0 million were sold during the three months ended September 30, 2016. The total principal amount of residential real estate loans sold during the nine months ended September 30, 2017 and 2016 was $1.6 million and $15.2 million, respectively. Each of the transfers of these financial assets met the qualifications for sale accounting, and therefore all of the loans transferred have been derecognized in the unaudited Consolidated Financial Statements. The loans were transferred at their fair value and the related gain was recognized as non-interest income upon the transfer in the unaudited Consolidated Financial Statements. The following tables illustrate ending balances of the Corporation’s loan and lease portfolio, including impaired loans by class of receivable, and considering certain credit quality indicators as of September 30, 2017 and December 31, 2016:
Credit underwriting through a committee process is a key component of the Corporation’s operating philosophy. Commercial lenders have relatively low individual lending authority limits, and thus a significant portion of the Corporation’s new credit extensions require approval from a loan approval committee regardless of the type of loan or lease, asset quality grade of the credit, amount of the credit or the related complexities of each proposal. Each credit is evaluated for proper risk rating upon origination, at the time of each subsequent renewal, upon receipt and evaluation of updated financial information from the Corporation’s borrowers or as other circumstances dictate. The Corporation uses a nine grade risk rating system to monitor the ongoing credit quality of its loans and leases. The risk rating grades follow a consistent definition and are then applied to specific loan types based on the nature of the loan. Each risk rating is subjective and, depending on the size and nature of the credit, subject to various levels of review and concurrence on the stated risk rating. In addition to its nine grade risk rating system, the Corporation groups loans into four loan and related risk categories which determine the level and nature of review by management. Category I — Loans and leases in this category are performing in accordance with the terms of the contract and generally exhibit no immediate concerns regarding the security and viability of the underlying collateral, financial stability of the borrower, integrity or strength of the borrowers’ management team or the industry in which the borrower operates. The Corporation monitors Category I loans and leases through payment performance, continued maintenance of its personal relationships with such borrowers and continued review of such borrowers’ compliance with the terms of their respective agreements. Category II — Loans and leases in this category are beginning to show signs of deterioration in one or more of the Corporation’s core underwriting criteria such as financial stability, management strength, industry trends or collateral values. Management will place credits in this category to allow for proactive monitoring and resolution with the borrower to possibly mitigate the area of concern and prevent further deterioration or risk of loss to the Corporation. Category II loans are considered performing but are monitored frequently by the assigned business development officer and by subcommittees of the Bank’s Loan Committee. Category III — Loans and leases in this category are identified by management as warranting special attention. However, the balance in this category is not intended to represent the amount of adversely classified assets held by the Bank. Category III loans and leases generally exhibit undesirable characteristics, such as evidence of adverse financial trends and conditions, managerial problems, deteriorating economic conditions within the related industry or evidence of adverse public filings and may exhibit collateral shortfall positions. Management continues to believe that it will collect all contractual principal and interest in accordance with the original terms of the contracts relating to the loans and leases in this category, and therefore Category III loans are considered performing with no specific reserves established for this category. Category III loans are monitored by management and the Bank’s Loan Committee on a monthly basis and the Bank’s Board of Directors at each of their regularly scheduled meetings. Category IV — Loans and leases in this category are considered to be impaired. Impaired loans and leases have been placed on non-accrual as management has determined that it is unlikely that the Bank will receive the contractual principal and interest in accordance with the original terms of the agreement. Impaired loans are individually evaluated to assess the need for the establishment of specific reserves or charge-offs. When analyzing the adequacy of collateral, the Corporation obtains external appraisals at least annually for impaired loans and leases. External appraisals are obtained from the Corporation’s approved appraiser listing and are independently reviewed to monitor the quality of such appraisals. To the extent a collateral shortfall position is present, a specific reserve or charge-off will be recorded to reflect the magnitude of the impairment. Loans and leases in this category are monitored by management and the Bank’s Loan Committee on a monthly basis and the Bank’s Board of Directors at each of their regularly scheduled meetings. Utilizing regulatory classification terminology, the Corporation identified $36.7 million and $34.3 million of loans and leases as Substandard as of September 30, 2017 and December 31, 2016, respectively. The Corporation identified $5.1 million of loans and leases as Doubtful as of September 30, 2017. No loans and leases were considered Doubtful as of December 31, 2016. Additionally, no loans were considered Special Mention, or Loss as of either September 30, 2017 or December 31, 2016. The population of Substandard loans is a subset of Category III and Category IV loans. The delinquency aging of the loan and lease portfolio by class of receivable as of September 30, 2017 and December 31, 2016 was as follows:
The Corporation’s total impaired assets consisted of the following at September 30, 2017 and December 31, 2016, respectively.
As of September 30, 2017 and December 31, 2016, $10.9 million and $12.8 million of the non-accrual loans and leases were considered troubled debt restructurings, respectively. There were no unfunded commitments associated with troubled debt restructured loans and leases as of September 30, 2017. The following table provides the number of loans modified in a troubled debt restructuring and the pre- and post-modification recorded investment by class of receivable as of September 30, 2017 and December 31, 2016.
All loans and leases modified as a troubled debt restructuring are measured for impairment. The nature and extent of the impairment of restructured loans, including those which have experienced a default, is considered in the determination of an appropriate level of the allowance for loan and lease losses. As of September 30, 2017 and December 31, 2016, the Corporation’s troubled debt restructurings grouped by type of concession were as follows:
During the three months ended September 30, 2017, two commercial and industrial loans totaling $800,000 were modified to a troubled debt restructuring. During the nine months ended September 30, 2017, four commercial and industrial loans and one consumer loan totaling $4.4 million and $17,000, respectively, were modified to a troubled debt restructuring. No loans were modified to a troubled debt restructuring during the three and nine months ended September 30, 2016. There were five loans and leases modified in a troubled debt restructuring during the previous 12 months which subsequently defaulted during the three and nine months ended September 30, 2017. The following represents additional information regarding the Corporation’s impaired loans and leases, including performing troubled debt restructurings, by class:
The difference between the recorded investment of loans and leases and the unpaid principal balance of $4.5 million and $3.4 million as of September 30, 2017 and December 31, 2016, respectively, represents partial charge-offs of loans and leases resulting from losses due to the appraised value of the collateral securing the loans and leases being below the carrying values of the loans and leases. Impaired loans and leases also included $275,000 and $717,000 of loans as of September 30, 2017 and December 31, 2016, respectively, that were performing troubled debt restructurings, and although not on non-accrual, were reported as impaired due to the concession in terms. When a loan is placed on non-accrual, interest accrual is discontinued and previously accrued but uncollected interest is deducted from interest income. Cash payments collected on non-accrual loans are first applied to such loan’s principal. Foregone interest represents the interest that was contractually due on the loan but not received or recorded. To the extent the amount of principal on a non-accrual loan is fully collected and additional cash is received, the Corporation will recognize interest income. To determine the level and composition of the allowance for loan and lease losses, the Corporation categorizes the portfolio into segments with similar risk characteristics. First, the Corporation evaluates loans and leases for potential impairment classification. The Corporation analyzes each loan and lease determined to be impaired on an individual basis to determine a specific reserve based upon the estimated value of the underlying collateral for collateral-dependent loans, or alternatively, the present value of expected cash flows. The Corporation applies historical trends from established risk factors to each category of loans and leases that has not been individually evaluated for the purpose of establishing the general portion of the allowance. A summary of the activity in the allowance for loan and lease losses by portfolio segment is as follows:
The following tables provide information regarding the allowance for loan and lease losses and balances by type of allowance methodology.
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Other Assets (Notes) |
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Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Assets | Note 6 — Other Assets The Corporation is a limited partner in several limited partnership investments. The Corporation is not the general partner, does not have controlling ownership and is not the primary beneficiary in any of these limited partnerships and the limited partnerships have not been consolidated. These investments are accounted for using the equity method of accounting and are evaluated for impairment at the end of each reporting period. For historic rehabilitation tax credits, the Corporation begins to evaluate its investments for impairment at the time the credit is earned, which is typically in the year the project is placed in service, through the end of its five-year compliance period. New market tax credits are also evaluated for impairment beginning at the time the tax credits are earned on the project through the seven-year compliance period. Historic Rehabilitation Tax Credits In 2015, the Corporation invested in a development entity through BOC, a wholly-owned subsidiary of FBB, to acquire, rehabilitate and operate a historic building in Madison, Wisconsin. At September 30, 2017 and December 31, 2016, the net carrying value of the investment was $174,000. In 2016, the Corporation also invested in a development entity through Mitchell Street, a wholly-owned subsidiary of FBB, to rehabilitate a historic building in Milwaukee, Wisconsin. At September 30, 2017 and December 31, 2016, the net carrying value of the investment was $563,000. The aggregate capital contributions to the project will depend upon the final amount of the certified project costs, but are expected to approximate $5.5 million. The Corporation is also anticipating the sale of the state credits associated with the investment to a third party. No historic tax credits were received at September 30, 2017. The credits will be taken when the project is placed in service and are subject to a five-year recapture period. In 2017, the Corporation also invested in a development entity through FBB Tax Credit, a wholly-owned subsidiary of FBB, to rehabilitate a historic building in Kenosha, Wisconsin. At September 30, 2017, the net carrying value of the investment was $417,000. The aggregate capital contributions to the project will depend upon the final amount of the certified project costs, but are expected to approximate $2.1 million. The credits will be taken when the project is placed in service and are subject to a five-year recapture period. New Market Tax Credits The Corporation invested in a community development entity (“CDE”) through Rimrock Road, a wholly-owned subsidiary of FBB, to develop and operate a real estate project located in a low-income community. At September 30, 2017 and December 31, 2016, Rimrock had one CDE investment with a net carrying value of $6.7 million and $7.1 million, respectively. The investment provides federal new market tax credits over a seven-year credit allowance period through 2020. The remaining federal new market tax credit to be utilized over a maximum of seven years was $1.5 million as of September 30, 2017. The Corporation’s use of the federal new market tax credit during the nine months ended September 30, 2017 and 2016 was $338,000 and $281,000, respectively. Other Investments The Corporation has an equity investment in Aldine Capital Fund, LP, a mezzanine fund, of $948,000 and $883,000 recorded as of September 30, 2017 and December 31, 2016, respectively. The Corporation’s equity investment in Aldine Capital Fund II, LP, also a mezzanine fund, totaled $3.7 million and $3.1 million as of September 30, 2017 and December 31, 2016, respectively. The Corporation’s share of these partnerships’ income included in the unaudited Consolidated Statements of Income for the nine months ended September 30, 2017 and 2016 was $236,000 and $708,000, respectively. The Corporation is the sole owner of $315,000 of common securities issued by Trust II, a Delaware business trust. The purpose of Trust II was to complete the sale of $10.0 million of 10.50% fixed rate preferred securities. Trust II, a wholly owned subsidiary of the Corporation, is not consolidated into the financial statements of the Corporation. The investment in Trust II of $315,000 as of September 30, 2017 and December 31, 2016 is included in accrued interest receivable and other assets. A summary of accrued interest receivable and other assets is as follows:
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Deposits |
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Deposits [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deposits | Deposits The composition of deposits at September 30, 2017 and December 31, 2016 is shown below. Average balances represent year-to-date averages.
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FHLB Advances, Other Borrowings and Junior Subordinated Notes Payable |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FHLB Advances, Other Borrowings and Junior Subordinated Notes Payable | FHLB Advances, Other Borrowings and Junior Subordinated Notes The composition of borrowed funds at September 30, 2017 and December 31, 2016 is shown below. Average balances represent year-to-date averages.
As of September 30, 2017 and December 31, 2016, the Corporation was in compliance with its debt covenants under its third-party secured senior line of credit. Per the promissory note dated February 19, 2017, the Corporation pays a commitment fee on this line of credit. During both the nine months ended September 30, 2017 and 2016, the Corporation incurred interest expense due to this fee of $10,000. |
Commitments and Contingencies (Notes) |
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Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Text Block] | Commitments and Contingencies In the ordinary course of business, the Corporation sells the guaranteed portion of SBA loans, as well as participation interests in other originated loans, to third parties. The Corporation has a continuing involvement in each of the transferred lending arrangements by way of relationship management and servicing the loans, as well as being subject to normal and customary requirements of the SBA loan program and standard representations and warranties related to sold amounts. In the event of a loss resulting from default and a determination by the SBA that there is a deficiency in the manner in which the loan was originated, funded or serviced by the Corporation, the SBA may require the Corporation to repurchase the loan, deny its liability under the guaranty, reduce the amount of the guaranty, or, if it has already paid under the guaranty, seek recovery of the principal loss related to the deficiency from the Corporation. The Corporation must comply with applicable SBA regulations in order to maintain the guaranty. In addition, the Corporation retains the option to repurchase the sold guaranteed portion of an SBA loan if the loan defaults. Management has assessed estimated losses inherent in the outstanding guaranteed portion of SBA loans sold in accordance with ASC 450, Contingencies, and determined a recourse reserve based on the probability of future losses for these loans to be $2.7 million at September 30, 2017, which is reported in accrued interest payable and other liabilities on the unaudited Consolidated Balance Sheets. During the nine months ended September 30, 2017, a $2.1 million recourse provision was recorded. The summary of the activity in the SBA recourse reserve is as follows:
In the normal course of business, various legal proceedings involving the Corporation are pending. Management, based upon advice from legal counsel, does not anticipate any significant losses as a result of these actions. Management believes that any liability arising from any such proceedings currently existing or threatened will not have a material adverse effect on the Corporation’s financial position, results of operations and cash flows. |
Fair Value Disclosures |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures | Fair Value Disclosures The Corporation determines the fair values of its financial instruments based on the fair value hierarchy established in ASC Topic 820, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Fair value is defined as the price that would be received in an orderly transaction that is not a forced liquidation or distressed sale at the measurement date and is based on exit prices. Fair value includes assumptions about risk, such as nonperformance risk in liability fair values, and is a market-based measurement, not an entity-specific measurement. The standard describes three levels of inputs that may be used to measure fair value. Level 1 — Level 1 inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Corporation has the ability to access at the measurement date. Level 2 — Level 2 inputs are inputs, other than quoted prices included with Level 1, that are observable for the asset or liability either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 — Level 3 inputs are supported by little or no market activity and are significant to the fair value of the assets or liabilities. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Corporation’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. Assets and liabilities measured at fair value on a recurring basis, segregated by fair value hierarchy level, are summarized below:
For assets and liabilities measured at fair value on a recurring basis, there were no transfers between the levels during the nine months ended September 30, 2017 or the year ended December 31, 2016 related to the above measurements. Assets and liabilities measured at fair value on a non-recurring basis, segregated by fair value hierarchy are summarized below:
Impaired loans were written down to the fair value of their underlying collateral less costs to sell of $16.3 million and $13.4 million at September 30, 2017 and December 31, 2016, respectively, through the establishment of specific reserves or by recording charge-offs when the carrying value exceeded the fair value of the underlying collateral of impaired loans. Valuation techniques consistent with the market approach, income approach or cost approach were used to measure fair value and primarily included observable inputs for the individual impaired loans being evaluated such as current appraisals, recent sales of similar assets or other observable market data, and are reflected within Level 2 of the hierarchy. In cases where an input is unobservable, specifically when discounts are applied to appraisal values to adjust such values to current market conditions or to reflect net realizable value, the impaired loan balance is reflected within Level 3 of the hierarchy. The quantification of unobservable inputs for Level 3 impaired loan values range from 13% - 90% as of the measurement date of September 30, 2017. The weighted average of those unobservable inputs was 20%. The majority of the impaired loans in the Level 3 category are considered collateral dependent loans or are supported by a SBA guaranty. Foreclosed properties, upon initial recognition, are remeasured and reported at fair value through a charge-off to the allowance for loan and lease losses, if deemed necessary, based upon the fair value of the foreclosed property. The fair value of a foreclosed property, upon initial recognition, is estimated using a market approach or Level 2 inputs based on observable market data, typically a current appraisal, or Level 3 inputs based upon assumptions specific to the individual property or equipment. Level 3 inputs typically include unobservable inputs such as management applied discounts used to further reduce values to a net realizable value and may be used in situations when observable inputs become stale. Foreclosed property fair value inputs may transition to Level 1 upon receipt of an accepted offer for the sale of the related foreclosed property. Fair Value of Financial Instruments The Corporation is required to disclose estimated fair values for its financial instruments. Fair value estimates, methods and assumptions, consistent with exit price concepts for fair value measurements, are set forth below:
Disclosure of fair value information about financial instruments, for which it is practicable to estimate that value, is required whether or not recognized in the unaudited Consolidated Balance Sheets. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, could not be realized in immediate settlement of the instruments. Certain financial instruments and all non-financial instruments are excluded from the disclosure requirements. Accordingly, the aggregate fair value amounts presented do not necessarily represent the underlying value of the Corporation. Cash and Cash Equivalents: The carrying amount reported for cash and due from banks and interest-bearing deposits held by the Corporation approximates fair value because of its immediate availability and because it does not present unanticipated credit concerns. As of September 30, 2017 and December 31, 2016, the Corporation held $13.4 million and $20.3 million, respectively, of commercial paper. The fair value of commercial paper is classified as a Level 2 input due to the lack of available independent pricing sources. The carrying value of brokered certificates of deposit purchased approximates the fair value for these instruments. The fair value of brokered certificates of deposits purchased is based on the discounted value of contractual cash flows using a discount rate reflective of rates currently offered for deposits of similar remaining maturities. As of both September 30, 2017 and December 31, 2016, the Corporation held $3.3 million and $1.6 million of brokered certificates of deposits, respectively. Securities: The fair value measurements of investment securities are determined by a third-party pricing service which considers observable data that may include dealer quotes, market spreads, cash flows, the U.S. Treasury yield curve, trade execution data, market consensus prepayment speeds, credit information and the securities’ terms and conditions, among other things. The fair value measurements are subject to independent verification by another pricing source on a quarterly basis to review for reasonableness. Any significant differences in pricing are reviewed with appropriate members of management who have the relevant technical expertise to assess the results. The Corporation has determined that these valuations are classified in Level 2 of the fair value hierarchy. When the independent pricing service does not provide a fair value measurement for a particular security, the Corporation will estimate the fair value based on specific information about each security. Fair values derived in this manner are classified in Level 3 of the fair value hierarchy. Loans Held for Sale: Loans held for sale, which consist of the guaranteed portion of SBA loans, are carried at the lower of cost or estimated fair value. The estimated fair value is based on what secondary markets are currently offering for portfolios with similar characteristics. Loans and Lease Receivables, net: The fair value estimation process for the loan portfolio uses an exit price concept and reflects discounts that the Corporation believes are consistent with liquidity discounts in the market place. Fair values are estimated for portfolios of loans with similar financial characteristics. The fair value of performing and nonperforming loans is calculated by discounting scheduled and expected cash flows through the estimated maturity using estimated market rates that reflect the credit and interest rate risk inherent in the portfolio of loans and then applying a discount factor based upon the embedded credit risk of the loan and the fair value of collateral securing nonperforming loans when the loan is collateral dependent. The estimate of maturity is based on the Bank’s historical experience with repayments for each loan classification, modified, as required, by an estimate of the effect of current economic and lending conditions. Significant unobservable inputs include, but are not limited to, discounts (investor yield premiums) applied to fair value calculations to further determine the exit price value of a portfolio of loans. Federal Home Loan Bank and Federal Reserve Bank Stock: The carrying amount of FHLB and Federal Reserve Bank (“FRB”) stock equals its fair value because the shares may be redeemed by the FHLB and the FRB at their carrying amount of $100 per share. Bank-Owned Life Insurance: The carrying amount of the cash surrender value of life insurance approximates its fair value as the carrying value represents the current settlement amount. Accrued Interest Receivable and Accrued Interest Payable: The carrying amounts reported for accrued interest receivable and accrued interest payable approximate fair value because of their immediate availability and because they do not present unanticipated credit concerns. Deposits: The fair value of deposits with no stated maturity, such as demand deposits and money market accounts, is equal to the amount payable on demand. The fair value of time deposits is based on the discounted value of contractual cash flows. The discount rate is estimated using the rates currently offered for deposits of similar remaining maturities. The fair value estimates do not include the intangible value that results from the funding provided by deposit liabilities compared to borrowing funds in the market. Borrowed Funds: Market rates currently available to the Corporation and Bank for debt with similar terms and remaining maturities are used to estimate fair value of existing debt. Interest Rate Swaps: The carrying amount and fair value of existing derivative financial instruments are based upon independent valuation models, which use widely accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of each derivative contract. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. The Corporation incorporates credit valuation adjustments to appropriately reflect both its own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements. In adjusting the fair value of its derivative contracts for the effect of nonperformance risk, the Corporation considers the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts and guarantees. Financial Instruments with Off-Balance-Sheet Risks: The fair value of the Corporation’s off-balance-sheet instruments is based on quoted market prices and fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the credit standing of the related counterparty. Commitments to extend credit and standby letters of credit are generally not marketable. Furthermore, interest rates on any amounts drawn under such commitments would generally be established at market rates at the time of the draw. Fair value would principally derive from the present value of fees received for those products. Limitations: Fair value estimates are made at a discrete point in time, based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time the Corporation’s entire holding of a particular financial instrument. Because no market exists for a significant portion of the Corporation’s financial instruments, fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments and other factors. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates. Fair value estimates are based on existing balance sheet financial instruments without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments. In addition, the tax ramifications related to the realization of the unrealized gains and losses can have a significant effect on fair value estimates and are not considered in the estimates. |
Derivative Financial Instruments |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Financial Instruments | Derivative Financial Instruments The Corporation offers interest rate swap products directly to qualified commercial borrowers. The Corporation economically hedges client derivative transactions by entering into offsetting interest rate swap contracts executed with a third party. Derivative transactions executed as part of this program are not designated as accounting hedge relationships and are marked- to-market through earnings each period. The derivative contracts have mirror-image terms, which results in the positions’ changes in fair value primarily offsetting through earnings each period. The credit risk and risk of non-performance embedded in the fair value calculations is different between the dealer counterparties and the commercial borrowers which may result in a difference in the changes in the fair value of the mirror-image swaps. The Corporation incorporates credit valuation adjustments to appropriately reflect both its own non-performance risk and the counterparty’s risk in the fair value measurements. When evaluating the fair value of its derivative contracts for the effects of non-performance and credit risk, the Corporation considered the impact of netting and any applicable credit enhancements such as collateral postings, thresholds and guarantees. At September 30, 2017, the aggregate amortizing notional value of interest rate swaps with various commercial borrowers was $52.3 million. The Corporation receives fixed rates and pays floating rates based upon LIBOR on the swaps with commercial borrowers. These interest rate swaps mature between September 2018 and March 2034. Commercial borrower swaps are completed independently with each borrower and are not subject to master netting arrangements. These commercial borrower swaps were reported on the unaudited Consolidated Balance Sheets as a derivative asset of $1.4 million, included in accrued interest receivable and other assets as of September 30, 2017. In the event of default on a commercial borrower interest rate swap by the counterparty, a right of offset exists to allow for the commercial borrower to set off amounts due against the related commercial loan. As of September 30, 2017, no interest rate swaps were in default and therefore all values for the commercial borrower swaps are recorded on a gross basis on the unaudited Consolidated Balance Sheets. At September 30, 2017, the aggregate amortizing notional value of interest rate swaps with dealer counterparties was also $52.3 million. The Corporation pays fixed rates and receives floating rates based upon LIBOR on the swaps with dealer counterparties. These interest rate swaps mature in September 2018 through March 2034. Dealer counterparty swaps are subject to master netting agreements among the contracts within our Bank and were reported on the unaudited Consolidated Balance Sheets as a net derivative liability of $1.4 million. The value of these swaps was included in accrued interest payable and other liabilities as of September 30, 2017. The gross amount of dealer counterparty swaps was also $1.4 million as no right of offset existed with the dealer counterparty swaps as of September 30, 2017. The table below provides information about the balance sheet location and fair value of the Corporation’s derivative instruments as of September 30, 2017 and December 31, 2016.
No derivative instruments held by the Corporation for the nine months ended September 30, 2017 were considered hedging instruments. All changes in the fair value of these instruments are recorded in other non-interest income. Given the mirror-image terms of the outstanding derivative portfolio, the change in fair value for the nine months ended September 30, 2017 and 2016 had an insignificant impact on the unaudited Consolidated Statements of Income. |
Regulatory Capital |
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Regulatory Capital Requirements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Regulatory Capital | Regulatory Capital The Corporation and the Bank are subject to various regulatory capital requirements administered by Federal and the State of Wisconsin banking agencies. Failure to meet minimum capital requirements can result in certain mandatory, and possibly additional discretionary actions on the part of regulators, that if undertaken, could have a direct material effect on the Bank’s assets, liabilities and certain off-balance-sheet items as calculated under regulatory practices. The Corporation’s and the Bank’s capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings and other factors. The Corporation regularly reviews and updates when appropriate its Capital and Liquidity Action Plan, which is designed to help ensure appropriate capital adequacy, to plan for future capital needs and to ensure that the Corporation serves as a source of financial strength to the Bank. The Corporation’s and the Bank’s Boards of Directors and management teams adhere to the appropriate regulatory guidelines on decisions which affect their respective capital positions, including but not limited to, decisions relating to the payment of dividends and increasing indebtedness. As a bank holding company, the Corporation’s ability to pay dividends is affected by the policies and enforcement powers of the Board of Governors of the Federal Reserve system (the “Federal Reserve”). Federal Reserve guidance urges financial institutions to strongly consider eliminating, deferring or significantly reducing dividends if: (i) net income available to common shareholders for the past four quarters, net of dividends previously paid during that period, is not sufficient to fully fund the dividend; (ii) the prospective rate of earnings retention is not consistent with the bank holding company’s capital needs and overall current prospective financial condition; or (iii) the bank holding company will not meet, or is in danger of not meeting, its minimum regulatory capital ratios. Management intends, when appropriate under regulatory guidelines, to consult with the Federal Reserve Bank of Chicago and provide it with information on the Corporation’s then-current and prospective earnings and capital position in advance of declaring any cash dividends. As a Wisconsin corporation, the Corporation is subject to the limitations of the Wisconsin Business Corporation Law, which prohibit the Corporation from paying dividends if such payment would: (i) render the Corporation unable to pay its debts as they become due in the usual course of business, or (ii) result in the Corporation’s assets being less than the sum of its total liabilities plus the amount needed to satisfy the preferential rights upon dissolution of any stockholders with preferential rights superior to those stockholders receiving the dividend. The Bank is also subject to certain legal, regulatory and other restrictions on their ability to pay dividends to the Corporation. As a bank holding company, the payment of dividends by the Bank to the Corporation is one of the sources of funds the Corporation could use to pay dividends, if any, in the future and to make other payments. Future dividend decisions by the Bank and the Corporation will continue to be subject to compliance with various legal, regulatory and other restrictions as defined from time to time. Qualitative measures established by regulation to ensure capital adequacy require the Corporation and the Bank to maintain minimum amounts and ratios of Total, Common Equity Tier 1 and Tier 1 capital to risk-weighted assets and of Tier 1 capital to adjusted total assets. These risk-based capital requirements presently address credit risk related to both recorded and off-balance-sheet commitments and obligations. In July 2013, the FRB and the FDIC approved the final rules implementing the Basel Committee on Banking Supervision’s capital guidelines for U.S. banks. These rules are applicable to all financial institutions that are subject to minimum capital requirements, including federal and state banks and savings and loan associations, as well as bank and savings and loan holding companies other than “small bank holding companies” (generally non-publicly traded bank holding companies with consolidated assets of less than $1 billion). Under the final rules, minimum requirements increased for both the quantity and quality of capital held by the Corporation. The rules include a new Common Equity Tier 1 capital to risk-weighted assets minimum ratio of 4.5%, raise the minimum ratio of Tier 1 capital to risk-weighted assets from 4.0% to 6.0%, require a minimum ratio of Total Capital to risk-weighted assets of 8.0%, and require a minimum Tier 1 leverage ratio of 4.0%. The rules also permit banking organizations with less than $15 billion in assets to retain, through a one-time election, the past treatment for accumulated other comprehensive income, which did not affect regulatory capital. The Corporation elected to retain this treatment, which reduces the volatility of regulatory capital ratios. A new capital conservation buffer, comprised of Common Equity Tier 1 capital, was also established above the regulatory minimum capital requirements. This capital conservation buffer will be phased in beginning January 1, 2016 at 0.625% of risk-weighted assets and will increase each subsequent year by an additional 0.625% until reaching its final level of 2.5% on January 1, 2019. As of September 30, 2017, both the Corporation’s and the Bank’s capital levels remained characterized as well capitalized under the new rules. The following table summarizes both the Corporation’s and Bank’s capital ratios and the ratios required by their federal regulators at September 30, 2017:
The following table summarizes both the Corporation’s and the Corporation’s legacy bank charters’ ratios and the ratios required by their federal regulators at December 31, 2016:
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Nature of Operations and Summary of Significant Accounting Policies Nature of Operations and Summary of Significant Accounting Policies (Policies) |
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Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation. The accompanying unaudited Consolidated Financial Statements were prepared in accordance with GAAP and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with the Corporation’s Consolidated Financial Statements and footnotes thereto included in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2016. |
Principles of Consolidation | The unaudited Consolidated Financial Statements include the accounts of the Corporation and its wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. In accordance with the provisions of Accounting Standards Codification (“ASC”) Topic 810, the Corporation’s ownership interest in FBFS Statutory Trust II (“Trust II”) has not been consolidated into the financial statements. |
Use of Estimates | Management of the Corporation is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements as well as reported amounts of revenues and expenses during the reporting period. Actual results could differ significantly from those estimates. Material estimates that could significantly change in the near-term include the value of securities, level of the allowance for loan and lease losses, lease residuals, property under operating leases, goodwill, level of the Small Business Administration (“SBA”) recourse reserve and income taxes. |
Reclassification | Certain amounts in prior periods may have been reclassified to conform to the current presentation |
Subsequent Events | Subsequent events have been evaluated through the date of the issuance of the unaudited Consolidated Financial Statements. No significant subsequent events have occurred through this date requiring adjustment to the financial statements or disclosures. T |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” with an original effective date for annual reporting periods beginning after December 15, 2016. The ASU is a converged standard between the FASB and the IASB that provides a single comprehensive revenue recognition model for all contracts with customers across transactions and industries. The primary objective of the ASU is revenue recognition that represents the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. In August 2015, the FASB issued ASU No. 2015-14, which defers the effective date of ASU 2014-09 to annual and interim reporting periods in fiscal years beginning after December 15, 2017. Earlier application is permitted only as of annual and interim reporting periods in fiscal years beginning after December 15, 2016. In March 2016, the FASB issued ASU No. 2016-08, “Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net.” The ASU intends to improve the operability and understandability of the implementation guidance of ASU 2014-09 on principal versus agent considerations. In April, May and December 2016, the FASB also issued ASU No. 2016-10, No. 2016-12 and No. 2016-20, respectively, related to Topic 606. The amendments do not change the core principles of the previously issued guidance, but instead further clarify and provide implementation guidance for certain aspects of the original ASU. The Corporation intends to adopt the accounting standards during the first quarter of 2018, as required. The Corporation has conducted its initial assessment and evaluated contracts to assess and quantify accounting methodology changes resulting from the adoption of this standard. The adoption of this accounting standard is not expected to have a material impact on the Corporation's consolidated financial statements. The FASB continues to release new accounting guidance related to the adoption of this standard, which could impact the Corporation's initial assessment and may change the conclusions reached as to the application of this new guidance. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842).” The ASU intends to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities and disclosing key information about leasing arrangements. The ASU will require lessees to recognize the following for all leases (with the exception of short-term leases) at the commencement date: (1) a lease liability, which is a lessees’ obligation to make lease payments arising from a lease, measured on a discounted basis; and (2) a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Under the new guidance, lessor accounting is largely unchanged. Certain targeted improvements were made to align, where necessary, lessor accounting with the lessee accounting model and Topic 606, Revenue from Contracts with Customers. The new lease guidance simplifies the accounting for sale and leaseback transactions primarily because lessees must recognize lease assets and lease liabilities. Lessees (for capital and operating leases) and lessors (for sales-type, direct financing, and operating leases) must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The modified retrospective approach would not require any transition accounting for leases that expired before the earliest comparative period presented. The ASU is effective for public companies for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. The Corporation intends to adopt the accounting standard during the first quarter of 2019, as required, and is currently evaluating the impact on its results of operations, financial position and liquidity. In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments- Credit Losses (Topic 326).” The ASU replaces the incurred loss impairment methodology for recognizing credit losses with a methodology that reflects all expected credit losses. The ASU also requires consideration of a broader range of information to inform credit loss estimates, including such factors as past events, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. The amendments affect loans, debt securities, trade receivables, net investments in leases, off-balance-sheet credit exposures, and any other financial asset not excluded from the scope that have the contractual right to receive cash. Entities will apply the amendments in the ASU through a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. The ASU is effective for public companies for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted as of the fiscal years beginning after December 15, 2018. The Corporation intends to adopt the accounting standard during the first quarter of 2020, as required, and is currently evaluating the impact on its results of operations, financial position and liquidity. In May 2017, the FASB issued ASU No. 2017-09, “Compensation- Stock Compensation (Topic 718).” The ASU provides clarity about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting. The ASU is effective for all entities for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early adoption is permitted. The Corporation is in the process of evaluating the impact of this standard but does not expect this standard to have a material impact on its results of operations, financial position and liquidity. In August 2017, the FASB issued ASU No. 2017-12, “Derivatives and Hedging (Topic 815).” The ASU intends to better align an entity’s risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. It also expands and refines hedge accounting for both nonfinancial and financial risk components and aligns the recognition and presentation of the effects of the hedging instrument and the hedged item. The ASU is effective for public companies for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. The Corporation is in the process of evaluating the impact of this standard but does not expect this standard to have a material impact on its results of operations, financial position and liquidity. |
Earnings Per Common Share (Policies) |
9 Months Ended |
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Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings per common share are computed using the two-class method. Basic earnings per common share are computed by dividing net income allocated to common shares by the weighted average number of shares outstanding during the applicable period, excluding outstanding participating securities. Participating securities include unvested restricted shares. Unvested restricted shares are considered participating securities because holders of these securities receive non-forfeitable dividends, or dividend equivalents, at the same rate as holders of the Corporation’s common stock. Diluted earnings per share are computed by dividing net income allocated to common shares, adjusted for reallocation of undistributed earnings of unvested restricted shares, by the weighted average number of shares determined for the basic earnings per common share computation plus the dilutive effect of common stock equivalents using the treasury stock method. |
Share-Based Compensation (Policies) |
9 Months Ended |
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Sep. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-based Compensation, Option and Incentive Plans | The Corporation adopted the 2012 Equity Incentive Plan (the “Plan”) during the quarter ended June 30, 2012. The Plan is administered by the Compensation Committee of the Board of Directors of the Corporation and provides for the grant of equity ownership opportunities through incentive stock options and nonqualified stock options, restricted stock, restricted stock units, dividend equivalent units and any other type of award permitted by the Plan. As of September 30, 2017, 217,475 shares were available for future grants under the Plan. Shares covered by awards that expire, terminate or lapse will again be available for the grant of awards under the Plan. The Corporation may issue new shares and shares from its treasury stock for shares delivered under the Plan. Restricted Stock Under the Plan, the Corporation may grant restricted stock to plan participants, subject to forfeiture upon the occurrence of certain events until the dates specified in the participant’s award agreement. While restricted stock is subject to forfeiture, with the exception of restricted stock units, which do not have voting rights and are provided dividend equivalents, restricted stock participants may exercise full voting rights and will receive all dividends and other distributions paid with respect to the restricted shares. The restricted stock granted under the Plan is typically subject to a vesting period. Compensation expense is recognized over the requisite service period of generally four years for the entire award on a straight-line basis. Upon vesting of restricted stock, the benefit of tax deductions in excess of recognized compensation expense is reflected as an income tax benefit in the unaudited Consolidated Statements of Income. |
Loan and Lease Receivables, Impaired Loans and Leases and Allowance for Loan and Lease Losses (Policies) |
9 Months Ended |
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Sep. 30, 2017 | |
Receivables [Abstract] | |
Loans and Leases Receivable, Allowance for Loan Losses | To determine the level and composition of the allowance for loan and lease losses, the Corporation categorizes the portfolio into segments with similar risk characteristics. First, the Corporation evaluates loans and leases for potential impairment classification. The Corporation analyzes each loan and lease determined to be impaired on an individual basis to determine a specific reserve based upon the estimated value of the underlying collateral for collateral-dependent loans, or alternatively, the present value of expected cash flows. The Corporation applies historical trends from established risk factors to each category of loans and leases that has not been individually evaluated for the purpose of establishing the general portion of the allowance. |
Fair Value Disclosures (Policies) |
9 Months Ended |
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Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | The Corporation determines the fair values of its financial instruments based on the fair value hierarchy established in ASC Topic 820, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Fair value is defined as the price that would be received in an orderly transaction that is not a forced liquidation or distressed sale at the measurement date and is based on exit prices. Fair value includes assumptions about risk, such as nonperformance risk in liability fair values, and is a market-based measurement, not an entity-specific measurement. The standard describes three levels of inputs that may be used to measure fair value. Level 1 — Level 1 inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Corporation has the ability to access at the measurement date. Level 2 — Level 2 inputs are inputs, other than quoted prices included with Level 1, that are observable for the asset or liability either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 — Level 3 inputs are supported by little or no market activity and are significant to the fair value of the assets or liabilities. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Corporation’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. Impaired loans were written down to the fair value of their underlying collateral less costs to sell of $16.3 million and $13.4 million at September 30, 2017 and December 31, 2016, respectively, through the establishment of specific reserves or by recording charge-offs when the carrying value exceeded the fair value of the underlying collateral of impaired loans. Valuation techniques consistent with the market approach, income approach or cost approach were used to measure fair value and primarily included observable inputs for the individual impaired loans being evaluated such as current appraisals, recent sales of similar assets or other observable market data, and are reflected within Level 2 of the hierarchy. In cases where an input is unobservable, specifically when discounts are applied to appraisal values to adjust such values to current market conditions or to reflect net realizable value, the impaired loan balance is reflected within Level 3 of the hierarchy. The quantification of unobservable inputs for Level 3 impaired loan values range from 13% - 90% as of the measurement date of September 30, 2017. The weighted average of those unobservable inputs was 20%. The majority of the impaired loans in the Level 3 category are considered collateral dependent loans or are supported by a SBA guaranty. Foreclosed properties, upon initial recognition, are remeasured and reported at fair value through a charge-off to the allowance for loan and lease losses, if deemed necessary, based upon the fair value of the foreclosed property. The fair value of a foreclosed property, upon initial recognition, is estimated using a market approach or Level 2 inputs based on observable market data, typically a current appraisal, or Level 3 inputs based upon assumptions specific to the individual property or equipment. Level 3 inputs typically include unobservable inputs such as management applied discounts used to further reduce values to a net realizable value and may be used in situations when observable inputs become stale. Foreclosed property fair value inputs may transition to Level 1 upon receipt of an accepted offer for the sale of the related foreclosed property. |
Fair Value Measurement | Disclosure of fair value information about financial instruments, for which it is practicable to estimate that value, is required whether or not recognized in the unaudited Consolidated Balance Sheets. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, could not be realized in immediate settlement of the instruments. Certain financial instruments and all non-financial instruments are excluded from the disclosure requirements. Accordingly, the aggregate fair value amounts presented do not necessarily represent the underlying value of the Corporation. Cash and Cash Equivalents: The carrying amount reported for cash and due from banks and interest-bearing deposits held by the Corporation approximates fair value because of its immediate availability and because it does not present unanticipated credit concerns. As of September 30, 2017 and December 31, 2016, the Corporation held $13.4 million and $20.3 million, respectively, of commercial paper. The fair value of commercial paper is classified as a Level 2 input due to the lack of available independent pricing sources. The carrying value of brokered certificates of deposit purchased approximates the fair value for these instruments. The fair value of brokered certificates of deposits purchased is based on the discounted value of contractual cash flows using a discount rate reflective of rates currently offered for deposits of similar remaining maturities. As of both September 30, 2017 and December 31, 2016, the Corporation held $3.3 million and $1.6 million of brokered certificates of deposits, respectively. Securities: The fair value measurements of investment securities are determined by a third-party pricing service which considers observable data that may include dealer quotes, market spreads, cash flows, the U.S. Treasury yield curve, trade execution data, market consensus prepayment speeds, credit information and the securities’ terms and conditions, among other things. The fair value measurements are subject to independent verification by another pricing source on a quarterly basis to review for reasonableness. Any significant differences in pricing are reviewed with appropriate members of management who have the relevant technical expertise to assess the results. The Corporation has determined that these valuations are classified in Level 2 of the fair value hierarchy. When the independent pricing service does not provide a fair value measurement for a particular security, the Corporation will estimate the fair value based on specific information about each security. Fair values derived in this manner are classified in Level 3 of the fair value hierarchy. Loans Held for Sale: Loans held for sale, which consist of the guaranteed portion of SBA loans, are carried at the lower of cost or estimated fair value. The estimated fair value is based on what secondary markets are currently offering for portfolios with similar characteristics. Loans and Lease Receivables, net: The fair value estimation process for the loan portfolio uses an exit price concept and reflects discounts that the Corporation believes are consistent with liquidity discounts in the market place. Fair values are estimated for portfolios of loans with similar financial characteristics. The fair value of performing and nonperforming loans is calculated by discounting scheduled and expected cash flows through the estimated maturity using estimated market rates that reflect the credit and interest rate risk inherent in the portfolio of loans and then applying a discount factor based upon the embedded credit risk of the loan and the fair value of collateral securing nonperforming loans when the loan is collateral dependent. The estimate of maturity is based on the Bank’s historical experience with repayments for each loan classification, modified, as required, by an estimate of the effect of current economic and lending conditions. Significant unobservable inputs include, but are not limited to, discounts (investor yield premiums) applied to fair value calculations to further determine the exit price value of a portfolio of loans. Federal Home Loan Bank and Federal Reserve Bank Stock: The carrying amount of FHLB and Federal Reserve Bank (“FRB”) stock equals its fair value because the shares may be redeemed by the FHLB and the FRB at their carrying amount of $100 per share. Bank-Owned Life Insurance: The carrying amount of the cash surrender value of life insurance approximates its fair value as the carrying value represents the current settlement amount. Accrued Interest Receivable and Accrued Interest Payable: The carrying amounts reported for accrued interest receivable and accrued interest payable approximate fair value because of their immediate availability and because they do not present unanticipated credit concerns. Deposits: The fair value of deposits with no stated maturity, such as demand deposits and money market accounts, is equal to the amount payable on demand. The fair value of time deposits is based on the discounted value of contractual cash flows. The discount rate is estimated using the rates currently offered for deposits of similar remaining maturities. The fair value estimates do not include the intangible value that results from the funding provided by deposit liabilities compared to borrowing funds in the market. Borrowed Funds: Market rates currently available to the Corporation and Bank for debt with similar terms and remaining maturities are used to estimate fair value of existing debt. Interest Rate Swaps: The carrying amount and fair value of existing derivative financial instruments are based upon independent valuation models, which use widely accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of each derivative contract. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. The Corporation incorporates credit valuation adjustments to appropriately reflect both its own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements. In adjusting the fair value of its derivative contracts for the effect of nonperformance risk, the Corporation considers the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts and guarantees. Financial Instruments with Off-Balance-Sheet Risks: The fair value of the Corporation’s off-balance-sheet instruments is based on quoted market prices and fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the credit standing of the related counterparty. Commitments to extend credit and standby letters of credit are generally not marketable. Furthermore, interest rates on any amounts drawn under such commitments would generally be established at market rates at the time of the draw. Fair value would principally derive from the present value of fees received for those products. Limitations: Fair value estimates are made at a discrete point in time, based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time the Corporation’s entire holding of a particular financial instrument. Because no market exists for a significant portion of the Corporation’s financial instruments, fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments and other factors. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates. Fair value estimates are based on existing balance sheet financial instruments without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments. In addition, the tax ramifications related to the realization of the unrealized gains and losses can have a significant effect on fair value estimates and are not considered in the estimates. |
Derivative Financial Instruments (Policies) |
9 Months Ended |
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Sep. 30, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives | The Corporation offers interest rate swap products directly to qualified commercial borrowers. The Corporation economically hedges client derivative transactions by entering into offsetting interest rate swap contracts executed with a third party. Derivative transactions executed as part of this program are not designated as accounting hedge relationships and are marked- to-market through earnings each period. The derivative contracts have mirror-image terms, which results in the positions’ changes in fair value primarily offsetting through earnings each period. The credit risk and risk of non-performance embedded in the fair value calculations is different between the dealer counterparties and the commercial borrowers which may result in a difference in the changes in the fair value of the mirror-image swaps. The Corporation incorporates credit valuation adjustments to appropriately reflect both its own non-performance risk and the counterparty’s risk in the fair value measurements. When evaluating the fair value of its derivative contracts for the effects of non-performance and credit risk, the Corporation considered the impact of netting and any applicable credit enhancements such as collateral postings, thresholds and guarantees. |
Earnings Per Common Share (Tables) |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted |
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Share-Based Compensation (Tables) |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity | Restricted stock activity for the year ended December 31, 2016 and the nine months ended September 30, 2017 was as follows:
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Schedule of Share-based Compensation Expense | For the three and nine months ended September 30, 2017 and 2016, share-based compensation expense related to restricted stock included in the unaudited Consolidated Statements of Income was as follows:
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Securities (Tables) |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Available-for-sale Securities | The amortized cost and fair value of securities available-for-sale and the corresponding amounts of gross unrealized gains and losses recognized in accumulated other comprehensive income were as follows:
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Schedule of Held-to-maturity Securities | The amortized cost and fair value of securities held-to-maturity and the corresponding amounts of gross unrealized gains and losses were as follows:
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Investments Classified by Contractual Maturity | The amortized cost and fair value of securities by contractual maturity at September 30, 2017 are shown below. Actual maturities may differ from contractual maturities because issuers have the right to call or prepay certain obligations with or without call or prepayment penalties.
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Schedule of Unrealized Loss on Investments | A summary of unrealized loss information for securities available-for-sale, categorized by security type and length of time for which the security has been in a continuous unrealized loss position, follows:
A summary of unrealized loss information for securities held-to-maturity, categorized by security type and length of time for which the security has been in a continuous unrealized loss position, follows:
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Loan and Lease Receivables, Impaired Loans and Leases and Allowance for Loan and Lease Losses (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loan Composition Schedule | Loan and lease receivables consist of the following:
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Ownership of SBA Loans | As of September 30, 2017 and December 31, 2016, the total amount of the Corporation’s ownership of SBA loans on the unaudited Consolidated Balance Sheets comprised of the following:
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Financing Receivable by Credit Quality Indicators | The following tables illustrate ending balances of the Corporation’s loan and lease portfolio, including impaired loans by class of receivable, and considering certain credit quality indicators as of September 30, 2017 and December 31, 2016:
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Past Due Financing Receivables | The delinquency aging of the loan and lease portfolio by class of receivable as of September 30, 2017 and December 31, 2016 was as follows:
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Schedule of Financing Receivables, Non Accrual Status | The Corporation’s total impaired assets consisted of the following at September 30, 2017 and December 31, 2016, respectively.
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Troubled Debt Restructurings on Financing Receivables |
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Troubled Debt Restructurings by Modification Type | As of September 30, 2017 and December 31, 2016, the Corporation’s troubled debt restructurings grouped by type of concession were as follows:
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Impaired Financing Receivables | The following represents additional information regarding the Corporation’s impaired loans and leases, including performing troubled debt restructurings, by class:
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Allowance for Loan and Lease Losses by Portfolio Segment | A summary of the activity in the allowance for loan and lease losses by portfolio segment is as follows:
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Allowance for Loan and Lease Losses and Balances by Type of Allowance Methodology | The following tables provide information regarding the allowance for loan and lease losses and balances by type of allowance methodology.
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Other Assets (Tables) |
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Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Assets | A summary of accrued interest receivable and other assets is as follows:
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Deposits (Tables) |
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Deposits [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deposits | The composition of deposits at September 30, 2017 and December 31, 2016 is shown below. Average balances represent year-to-date averages.
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FHLB Advances, Other Borrowings and Junior Subordinated Notes Payable (Tables) |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Debt | The composition of borrowed funds at September 30, 2017 and December 31, 2016 is shown below. Average balances represent year-to-date averages.
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Commitments and Contingencies (Tables) |
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Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of SBA Recourse Reserve [Table Text Block] | The summary of the activity in the SBA recourse reserve is as follows:
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Fair Value Disclosures (Tables) |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements, Recurring Basis | Assets and liabilities measured at fair value on a recurring basis, segregated by fair value hierarchy level, are summarized below:
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Fair Value Measurements, Nonrecurring Basis | Assets and liabilities measured at fair value on a non-recurring basis, segregated by fair value hierarchy are summarized below:
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Fair Value, by Balance Sheet Grouping | Fair value estimates, methods and assumptions, consistent with exit price concepts for fair value measurements, are set forth below:
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Derivative Financial Instruments (Tables) |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The table below provides information about the balance sheet location and fair value of the Corporation’s derivative instruments as of September 30, 2017 and December 31, 2016.
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Regulatory Capital (Tables) |
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Regulatory Capital Requirements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Compliance with Regulatory Capital Requirements under Banking Regulations | The following table summarizes both the Corporation’s and Bank’s capital ratios and the ratios required by their federal regulators at September 30, 2017:
The following table summarizes both the Corporation’s and the Corporation’s legacy bank charters’ ratios and the ratios required by their federal regulators at December 31, 2016:
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Earnings Per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Basic earnings per common share | ||||
Net income | $ 2,584 | $ 2,665 | $ 7,867 | $ 10,941 |
Less: earnings allocated to participating securities | 35 | 38 | 105 | 165 |
Basic earnings allocated to common shareholders | $ 2,549 | $ 2,627 | $ 7,762 | $ 10,776 |
Weighted-average common shares outstanding, excluding participating securities | 8,621,311 | 8,582,836 | 8,606,080 | 8,569,613 |
Basic earnings per common share | $ 0.30 | $ 0.31 | $ 0.90 | $ 1.26 |
Diluted earnings per common share | ||||
Earnings allocated to common shareholders, diluted | $ 2,549 | $ 2,627 | $ 7,762 | $ 10,776 |
Weighted-average common shares outstanding, excluding participating securities | 8,621,311 | 8,582,836 | 8,606,080 | 8,569,613 |
Weighted-average diluted common shares outstanding, excluding participating securities | 8,621,311 | 8,582,836 | 8,606,080 | 8,569,613 |
Diluted earnings per common share | $ 0.30 | $ 0.31 | $ 0.90 | $ 1.26 |
Earnings Per Common Share (Narrative Disclosures) (Details) - shares |
9 Months Ended | |
---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Earnings Per Share [Abstract] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 0 | 0 |
Share-Based Compensation (Restricted Share Activity) (Details) - $ / shares |
9 Months Ended | 12 Months Ended |
---|---|---|
Sep. 30, 2017 |
Dec. 31, 2016 |
|
Number of Restricted Shares | ||
Nonvested balance, beginning | 116,245 | 135,471 |
Granted | 64,725 | 60,415 |
Vested | (45,695) | (56,090) |
Forfeited | (7,619) | (23,551) |
Nonvested balance, ending | 127,656 | 116,245 |
Weighted Average Grant-Date Fair Value | ||
Nonvested balance, beginning | $ 21.13 | $ 20.13 |
Granted | 21.62 | 22.74 |
Vested | 21.49 | 18.71 |
Forfeited | 21.57 | 20.90 |
Nonvested balance, ending | $ 21.39 | $ 21.13 |
Share-Based Compensation (Share-Based Payment Plan Expense) (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||
Share-based compensation | $ 268 | $ 292 | $ 811 | $ 858 |
Share-Based Compensation (Narrative Disclosures) (Details) $ in Millions |
9 Months Ended |
---|---|
Sep. 30, 2017
USD ($)
shares
| |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Number of shares available for grant | shares | 217,475 |
Deferred compensation expense yet to be recognized | $ | $ 2.6 |
Period of time that deferred compensation expense will be recognized | 3 years 10 days |
Securities (Contractual Maturity) (Details) - USD ($) $ in Thousands |
Sep. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Available-for-Sale, Amortized Cost | ||
Due in one year or less | $ 6,785 | |
Due in one year through five years | 13,156 | |
Due in five through ten years | 48,051 | |
Due in over ten years | 63,507 | |
Amortized cost | 131,499 | $ 146,461 |
Available-for-Sale, Estimated Fair Value | ||
Due in one year or less | 6,783 | |
Due in one year through five years | 13,194 | |
Due in five through ten years | 48,168 | |
Due in over ten years | 62,985 | |
Estimated fair value | 131,130 | 145,893 |
Held-to-Maturity, Amortized Cost | ||
Due in one year or less | 0 | |
Due in one year through five years | 11,177 | |
Due in five through ten years | 13,258 | |
Due in over ten years | 14,438 | |
Amortized cost | 38,873 | 38,612 |
Held-to-Maturity, Estimated Fair Value | ||
Due in one year or less | 0 | |
Due in one year through five years | 11,326 | |
Due in five through ten years | 13,495 | |
Due in over ten years | 14,453 | |
Estimated Fair Value | $ 39,274 | $ 38,520 |
Securities (Narrative Disclosures) (Details) $ in Thousands |
9 Months Ended | ||
---|---|---|---|
Sep. 30, 2017
USD ($)
securities
|
Sep. 30, 2016
USD ($)
securities
|
Dec. 31, 2016
USD ($)
|
|
Investments, Debt and Equity Securities [Abstract] | |||
Number of available-for-sale securities sold | 14 | 3 | |
Available-for-sale securities pledged as collateral | $ | $ 1,900 | $ 22,400 | |
Number of available-for-sales securities in an unrealized loss position | 106 | ||
Number of available-for-sale securities in an unrealized loss position, twelve months or greater | 56 | ||
Other than temporary impairment on available-for-sale securities recorded on the income statement | $ | $ 0 | $ 0 | |
Number of held-to-maturity securities in an unrealized loss position | 14 | ||
Number of held-to-maturity Securities in an unrealized loss position, twelve months or greater | 7 | ||
Other than temporary impairment on held-to-maturity securities recorded on the income statement | $ | $ 0 | $ 0 |
Loan and Lease Receivables, Impaired Loans and Leases and Allowance for Loan and Lease Losses (Loan Composition) (Details) - USD ($) $ in Thousands |
Sep. 30, 2017 |
Jun. 30, 2017 |
Dec. 31, 2016 |
Sep. 30, 2016 |
Jun. 30, 2016 |
Dec. 31, 2015 |
---|---|---|---|---|---|---|
Receivables [Abstract] | ||||||
Commercial real estate — owner occupied | $ 182,755 | $ 176,459 | ||||
Commercial real estate — non-owner occupied | 461,586 | 473,158 | ||||
Land development | 41,499 | 56,638 | ||||
Construction | 115,660 | 101,206 | ||||
Multi-family | 125,080 | 92,762 | ||||
1-4 family | 40,173 | 45,651 | ||||
Total commercial real estate | 966,753 | 945,874 | ||||
Commercial and industrial | 447,223 | 450,298 | ||||
Direct financing leases, net | 28,868 | 30,951 | ||||
Home equity and second mortgages | 7,776 | 8,412 | ||||
Other | 17,447 | 16,329 | ||||
Total consumer and other | 25,223 | 24,741 | ||||
Total gross loans and leases receivable | 1,468,067 | 1,451,864 | ||||
Allowance for loan and lease losses | 19,923 | $ 21,677 | 20,912 | $ 20,067 | $ 18,154 | $ 16,316 |
Deferred loan fees | 1,354 | 1,189 | ||||
Loans and leases receivable, net | $ 1,446,790 | $ 1,429,763 |
Loan and Lease Receivables, Impaired Loans and Leases and Allowance for Loan and Lease Losses (SBA Loans) (Details) - USD ($) $ in Thousands |
Sep. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Receivables [Abstract] | ||
Unguaranteed Portion of Sold SBA loans Retained | $ 30,632 | $ 30,418 |
Other SBA Loans | 25,684 | 31,728 |
Small Business Administration Loans | $ 56,316 | $ 62,146 |
Loan and Lease Receivables, Impaired Loans and Leases and Allowance for Loan and Lease Losses (Allowance for Loan and Lease Losses) (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Allowance for credit losses roll-forward | ||||
Allowance for loan and lease losses - begin | $ 21,677 | $ 18,154 | $ 20,912 | $ 16,316 |
Charge-offs | (3,230) | (1,656) | (7,196) | (3,250) |
Recoveries | 5 | 32 | 508 | 177 |
Net (charge-offs) recoveries | (3,225) | (1,624) | (6,688) | (3,073) |
Provision for credit loss | 1,471 | 3,537 | 5,699 | 6,824 |
Allowance for loan and lease losses - end | 19,923 | 20,067 | 19,923 | 20,067 |
Commercial real estate: | ||||
Allowance for credit losses roll-forward | ||||
Allowance for loan and lease losses - begin | 12,003 | 11,436 | 12,384 | 11,220 |
Charge-offs | (8) | (259) | (126) | (1,194) |
Recoveries | 2 | 31 | 152 | 170 |
Net (charge-offs) recoveries | (6) | (228) | 26 | (1,024) |
Provision for credit loss | (2,462) | 1,607 | (2,875) | 2,619 |
Allowance for loan and lease losses - end | 9,535 | 12,815 | 9,535 | 12,815 |
Commercial and industrial loans and leases | ||||
Allowance for credit losses roll-forward | ||||
Allowance for loan and lease losses - begin | 9,090 | 6,017 | 7,970 | 4,387 |
Charge-offs | (3,217) | (1,396) | (6,978) | (2,048) |
Recoveries | 2 | 0 | 314 | 2 |
Net (charge-offs) recoveries | (3,215) | (1,396) | (6,664) | (2,046) |
Provision for credit loss | 3,968 | 2,051 | 8,537 | 4,331 |
Allowance for loan and lease losses - end | 9,843 | 6,672 | 9,843 | 6,672 |
Consumer and other: | ||||
Allowance for credit losses roll-forward | ||||
Allowance for loan and lease losses - begin | 584 | 701 | 558 | 709 |
Charge-offs | (5) | (1) | (92) | (8) |
Recoveries | 1 | 1 | 42 | 5 |
Net (charge-offs) recoveries | (4) | 0 | (50) | (3) |
Provision for credit loss | (35) | (121) | 37 | (126) |
Allowance for loan and lease losses - end | $ 545 | $ 580 | $ 545 | $ 580 |
Loan and Lease Receivables, Impaired Loans and Leases and Allowance for Loan and Lease Losses Allowance for Loan and Lease Losses 2 (Details) - USD ($) $ in Thousands |
Sep. 30, 2017 |
Jun. 30, 2017 |
Dec. 31, 2016 |
Sep. 30, 2016 |
Jun. 30, 2016 |
Dec. 31, 2015 |
---|---|---|---|---|---|---|
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||||
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment | $ 14,133 | $ 15,313 | ||||
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment | 5,790 | 5,599 | ||||
Allowance for loan and lease losses | 19,923 | $ 21,677 | 20,912 | $ 20,067 | $ 18,154 | $ 16,316 |
Financing Receivable, Collectively Evaluated for Impairment | 1,434,560 | 1,425,953 | ||||
Financing Receivable, Individually Evaluated for Impairment | 32,882 | 24,286 | ||||
Loans and Leases Receivable, Gross | 1,468,067 | 1,451,864 | ||||
Loans acquired with deteriorated credit quality | ||||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||||
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment | 0 | 0 | ||||
Financing Receivable, Individually Evaluated for Impairment | 625 | 1,625 | ||||
Commercial real estate: | ||||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||||
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment | 9,426 | 10,485 | ||||
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment | 109 | 1,899 | ||||
Allowance for loan and lease losses | 9,535 | 12,003 | 12,384 | 12,815 | 11,436 | 11,220 |
Financing Receivable, Collectively Evaluated for Impairment | 947,600 | 933,048 | ||||
Financing Receivable, Individually Evaluated for Impairment | 18,535 | 11,222 | ||||
Loans and Leases Receivable, Gross | 966,753 | 945,874 | ||||
Commercial real estate: | Loans acquired with deteriorated credit quality | ||||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||||
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment | 0 | 0 | ||||
Financing Receivable, Individually Evaluated for Impairment | 618 | 1,604 | ||||
Commercial and industrial loans and leases | ||||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||||
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment | 4,185 | 4,270 | ||||
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment | 5,658 | 3,700 | ||||
Allowance for loan and lease losses | 9,843 | 9,090 | 7,970 | 6,672 | 6,017 | 4,387 |
Financing Receivable, Collectively Evaluated for Impairment | 462,122 | 468,776 | ||||
Financing Receivable, Individually Evaluated for Impairment | 13,962 | 12,452 | ||||
Loans and Leases Receivable, Gross | 476,091 | 481,249 | ||||
Commercial and industrial loans and leases | Loans acquired with deteriorated credit quality | ||||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||||
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment | 0 | 0 | ||||
Financing Receivable, Individually Evaluated for Impairment | 7 | 21 | ||||
Consumer and other: | ||||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||||
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment | 522 | 558 | ||||
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment | 23 | 0 | ||||
Allowance for loan and lease losses | 545 | $ 584 | 558 | $ 580 | $ 701 | $ 709 |
Financing Receivable, Collectively Evaluated for Impairment | 24,838 | 24,129 | ||||
Financing Receivable, Individually Evaluated for Impairment | 385 | 612 | ||||
Loans and Leases Receivable, Gross | 25,223 | 24,741 | ||||
Consumer and other: | Loans acquired with deteriorated credit quality | ||||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||||
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment | 0 | 0 | ||||
Financing Receivable, Individually Evaluated for Impairment | $ 0 | $ 0 |
Loan and Lease Receivables, Impaired Loans and Leases and Allowance for Loan and Lease Losses (Narrative Disclosures) (Details) loans in Thousands |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2017
USD ($)
|
Sep. 30, 2016
USD ($)
|
Sep. 30, 2017
USD ($)
loans
|
Sep. 30, 2016
USD ($)
|
Dec. 31, 2016
USD ($)
|
|
Financing Receivable, Recorded Investment | |||||
Financing Receivable, Modifications, Number of Contracts | 0 | 0 | |||
SBA loans in the participation sold portfolio, considered impaired | $ 11,900,000 | $ 11,900,000 | $ 5,500,000 | ||
Guaranteed Portion of SBA Loans Sold to Third Parties Total | 6,300,000 | $ 3,300,000 | 15,500,000 | $ 36,400,000 | |
Total amount of outstanding SBA loans sold | 103,300,000 | 103,300,000 | 105,100,000 | ||
Loans and leases transferred to third parties total principal amount | 9,000,000 | 7,900,000 | 17,000,000 | 17,700,000 | |
Gain (Loss) Recognized on Participation Interest in Originated Loans | 0 | 0 | |||
Total amount of outstanding loans transferred to third parties as loan participations | 91,700,000 | 91,700,000 | 102,700,000 | ||
Total amount of loan participations remaining on the Corporations balance sheet | 146,200,000 | 146,200,000 | 106,100,000 | ||
Loans in the participation sold portfolio, considered impaired | 0 | 0 | 0 | ||
Loan participations purchased on the Corporation's balance sheet | 669,000 | 669,000 | 1,200,000 | ||
Residential Real Estate Loans Sold, Principal Amount | 0 | $ 8,000,000 | 1,600,000 | $ 15,200,000 | |
Total gross loans and leases receivable | 1,468,067,000 | 1,468,067,000 | 1,451,864,000 | ||
Non-accrual troubled debt restructurings | 10,900,000 | 10,900,000 | 12,800,000 | ||
Unfunded commitments, troubled debt restructurings | 0 | $ 0 | |||
Troubled debt restructurings, subsequent default, number of loans | loans | 0 | ||||
Loans and leases receivable, difference between recorded investment and unpaid principal balance | 4,500,000 | $ 4,500,000 | 3,400,000 | ||
Performing troubled debt restructurings | 275,000 | 275,000 | 717,000 | ||
Substandard | |||||
Financing Receivable, Recorded Investment | |||||
Total gross loans and leases receivable | 36,700,000 | 36,700,000 | 34,300,000 | ||
Special Mention | |||||
Financing Receivable, Recorded Investment | |||||
Total gross loans and leases receivable | 0 | 0 | 0 | ||
Doubtful | |||||
Financing Receivable, Recorded Investment | |||||
Total gross loans and leases receivable | 5,055,000 | 5,055,000 | 0 | ||
Loss | |||||
Financing Receivable, Recorded Investment | |||||
Total gross loans and leases receivable | 0 | $ 0 | 0 | ||
Consumer and other: | |||||
Financing Receivable, Recorded Investment | |||||
Financing Receivable, Modifications, Number of Contracts | 1 | ||||
Financing Receivable, Modifications, Post-Modification Recorded Investment | $ 17,000 | ||||
Total gross loans and leases receivable | $ 25,223,000 | $ 25,223,000 | 24,741,000 | ||
Commercial and industrial | |||||
Financing Receivable, Recorded Investment | |||||
Financing Receivable, Modifications, Number of Contracts | 2 | 4 | |||
Financing Receivable, Modifications, Post-Modification Recorded Investment | $ 800,000 | $ 4,400,000 | |||
Total gross loans and leases receivable | $ 447,223,000 | $ 447,223,000 | $ 450,298,000 |
Other Assets Accrued Interest Receivable and Other Assets (Details) - USD ($) $ in Thousands |
Sep. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Accrued interest receivable | $ 4,722 | $ 4,677 |
Net deferred tax asset | 5,543 | 4,052 |
Investment in historic development entities | 1,154 | 737 |
Investment in a CDE | 6,719 | 7,106 |
Investment in limited partnerships | 4,607 | 3,963 |
Investment in Trust II | 315 | 315 |
Fair value of interest rate swaps | 1,380 | 352 |
Prepaid expenses | 3,338 | 3,074 |
Other assets | 4,450 | 4,331 |
Total accrued interest receivable and other assets | $ 32,228 | $ 28,607 |
Other Assets Tax Credits Narrative (Details) - USD ($) |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
Dec. 31, 2016 |
|
Investment Holdings [Line Items] | |||||
Investment in limited partnerships | $ 4,607,000 | $ 4,607,000 | $ 3,963,000 | ||
Impairment of tax credit investments | 112,000 | $ 3,314,000 | 338,000 | $ 3,520,000 | |
BOC Investment, LLC | Historic Rehabilitation Tax Credits | |||||
Investment Holdings [Line Items] | |||||
Investment in limited partnerships | 174,000 | 174,000 | 174,000 | ||
Mitchell Street Apartments Investment, LLC | Historic Rehabilitation Tax Credits | |||||
Investment Holdings [Line Items] | |||||
Investment in limited partnerships | 563,000 | 563,000 | 563,000 | ||
Tax Credit Benefits Recognized | 0 | ||||
Estimated Capital Contributions | 5,500,000 | 5,500,000 | |||
Kenosha [Member] [Member] | Historic Rehabilitation Tax Credits | |||||
Investment Holdings [Line Items] | |||||
Investment in limited partnerships | 417,000 | 417,000 | |||
Estimated Capital Contributions | 2,100,000 | 2,100,000 | |||
Rimrock Road Investment Fund, LLC | New Market Tax Credits | |||||
Investment Holdings [Line Items] | |||||
Investment in limited partnerships | 6,700,000 | 6,700,000 | $ 7,100,000 | ||
Tax Credit Benefits Recognized | $ 338,000 | $ 281,000 | |||
New Market Tax Credit Benefit, Period of Recognition | 7 years | ||||
Federal New Market Tax Credits Not Yet Recognized | $ 1,500,000 | $ 1,500,000 |
Other Assets Other Investments Narrative (Details) - USD ($) |
9 Months Ended | |||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Dec. 31, 2016 |
Sep. 26, 2008 |
|
Schedule of Equity Method Investments [Line Items] | ||||
Investment in limited partnerships | $ 4,607,000 | $ 3,963,000 | ||
Income (Loss) from Equity Method Investments | 236,000 | $ 708,000 | ||
Investment in Trust II | 315,000 | 315,000 | ||
Aldine Capital Fund, LP | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Investment in limited partnerships | 948,000 | 883,000 | ||
Aldine Capital Fund II, LP | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Investment in limited partnerships | $ 3,700,000 | $ 3,100,000 | ||
Trust II [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Sole ownership of common securities issued by Trust II | $ 315,000 | |||
Trust preferred securities | $ 10,000,000 | |||
Debt Instrument, Interest Rate, Stated Percentage | 10.50% |
Deposits (Details) - USD ($) $ in Thousands |
9 Months Ended | 12 Months Ended |
---|---|---|
Sep. 30, 2017 |
Dec. 31, 2016 |
|
Deposits [Line Items] | ||
Deposits | $ 1,423,724 | $ 1,538,855 |
Average balance, deposits | $ 1,481,183 | $ 1,591,971 |
Deposits, weighted average interest rate during the period | 0.72% | 0.74% |
Non-interest-bearing transaction accounts | ||
Deposits [Line Items] | ||
Deposits | $ 253,320 | $ 252,638 |
Average balance, deposits | $ 228,231 | $ 246,182 |
Deposits, weighted average interest rate during the period | 0.00% | 0.00% |
Interest-bearing transaction accounts | ||
Deposits [Line Items] | ||
Deposits | $ 251,355 | $ 183,992 |
Average balance, deposits | $ 221,526 | $ 169,571 |
Deposits, weighted average interest rate during the period | 0.53% | 0.27% |
Money market accounts | ||
Deposits [Line Items] | ||
Deposits | $ 527,705 | $ 627,090 |
Average balance, deposits | $ 601,455 | $ 642,784 |
Deposits, weighted average interest rate during the period | 0.45% | 0.48% |
Certificates of deposit | ||
Deposits [Line Items] | ||
Deposits | $ 58,144 | $ 58,454 |
Average balance, deposits | $ 55,888 | $ 65,608 |
Deposits, weighted average interest rate during the period | 0.98% | 0.90% |
Wholesale deposits | ||
Deposits [Line Items] | ||
Deposits | $ 333,200 | $ 416,681 |
Average balance, deposits | $ 374,083 | $ 467,826 |
Deposits, weighted average interest rate during the period | 1.68% | 1.62% |
FHLB Advances, Other Borrowings and Junior Subordinated Notes Payable (Composition of Borrowed Funds) (Details) - USD ($) $ in Thousands |
9 Months Ended | 12 Months Ended |
---|---|---|
Sep. 30, 2017 |
Dec. 31, 2016 |
|
Composition of Borrowed Funds [Line Items] | ||
Borrowed funds | $ 177,899 | $ 69,680 |
Borrowed funds, average balance | $ 118,929 | $ 50,945 |
Borrowed funds, interest rate during period | 3.38% | 6.03% |
Long-term borrowings | ||
Composition of Borrowed Funds [Line Items] | ||
Borrowed funds | $ 123,389 | $ 49,092 |
Short-term borrowings | ||
Composition of Borrowed Funds [Line Items] | ||
Borrowed funds | 54,510 | 20,588 |
Federal funds purchased | ||
Composition of Borrowed Funds [Line Items] | ||
Borrowed funds | 0 | 0 |
Borrowed funds, average balance | $ 88 | $ 178 |
Borrowed funds, interest rate during period | 1.21% | 0.92% |
FHLB advances | ||
Composition of Borrowed Funds [Line Items] | ||
Borrowed funds | $ 143,500 | $ 33,578 |
Borrowed funds, average balance | $ 83,987 | $ 14,485 |
Borrowed funds, interest rate during period | 1.24% | 0.97% |
Line of credit | ||
Composition of Borrowed Funds [Line Items] | ||
Borrowed funds | $ 10 | $ 1,010 |
Borrowed funds, average balance | $ 435 | $ 2,079 |
Borrowed funds, interest rate during period | 3.63% | 3.26% |
Other borrowings | ||
Composition of Borrowed Funds [Line Items] | ||
Borrowed funds | $ 675 | $ 2,590 |
Borrowed funds, average balance | $ 1,432 | $ 1,739 |
Borrowed funds, interest rate during period | 15.37% | 7.64% |
Subordinated notes payable | ||
Composition of Borrowed Funds [Line Items] | ||
Borrowed funds | $ 23,699 | $ 22,498 |
Borrowed funds, average balance | $ 22,978 | $ 22,467 |
Borrowed funds, interest rate during period | 7.04% | 7.13% |
Junior subordinated notes | ||
Composition of Borrowed Funds [Line Items] | ||
Borrowed funds | $ 10,015 | $ 10,004 |
Borrowed funds, average balance | $ 10,009 | $ 9,997 |
Borrowed funds, interest rate during period | 11.08% | 11.07% |
FHLB Advances, Other Borrowings and Junior Subordinated Notes Payable (Narrative Disclosures) (Details) - USD ($) |
9 Months Ended | |
---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Line of credit | ||
Line of Credit Facility [Line Items] | ||
Line of credit - unused line fee | $ 10,000 | $ 10,000 |
Commitments and Contingencies SBA Recourse Reserve Rollforward (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | 12 Months Ended | ||
---|---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
Dec. 31, 2016 |
|
Commitments and Contingencies Disclosure [Abstract] | |||||
Beginning balance | $ 1,750 | $ 0 | $ 0 | ||
SBA Recourse Provision | $ 1,315 | $ 375 | 2,095 | $ 449 | 2,068 |
SBA Loan Charge Offs, Net | (1,141) | (318) | |||
Ending balance | $ 2,704 | $ 2,704 | $ 1,750 |
Commitments and Contingencies Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | 12 Months Ended | ||
---|---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
Dec. 31, 2016 |
|
Commitments and Contingencies Disclosure [Abstract] | |||||
SBA Loans, Probability of Future Losses | $ 2,700 | $ 2,700 | |||
SBA Recourse Provision | $ 1,315 | $ 375 | $ 2,095 | $ 449 | $ 2,068 |
Fair Value Disclosures (Measured on a Recurring Basis) (Details) - USD ($) $ in Thousands |
Sep. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Interest rate swaps | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Liabilities measured on a recurring basis, fair value | $ 1,380 | $ 352 |
Interest rate swaps | Fair Value Measurements - Level 1 Inputs | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Liabilities measured on a recurring basis, fair value | 0 | 0 |
Interest rate swaps | Fair Value Measurements - Level 2 Inputs | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Liabilities measured on a recurring basis, fair value | 1,380 | 352 |
Interest rate swaps | Fair Value Measurements - Level 3 Inputs | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Liabilities measured on a recurring basis, fair value | 0 | 0 |
Interest rate swaps | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 1,380 | 352 |
Interest rate swaps | Fair Value Measurements - Level 1 Inputs | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 0 | 0 |
Interest rate swaps | Fair Value Measurements - Level 2 Inputs | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 1,380 | 352 |
Interest rate swaps | Fair Value Measurements - Level 3 Inputs | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 0 | 0 |
U.S. Government agency obligations - government-sponsored enterprises | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 3,807 | 6,295 |
U.S. Government agency obligations - government-sponsored enterprises | Fair Value Measurements - Level 1 Inputs | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 0 | 0 |
U.S. Government agency obligations - government-sponsored enterprises | Fair Value Measurements - Level 2 Inputs | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 3,807 | 6,295 |
U.S. Government agency obligations - government-sponsored enterprises | Fair Value Measurements - Level 3 Inputs | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 0 | 0 |
Municipal obligations | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 9,332 | 8,156 |
Municipal obligations | Fair Value Measurements - Level 1 Inputs | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 0 | 0 |
Municipal obligations | Fair Value Measurements - Level 2 Inputs | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 9,332 | 8,156 |
Municipal obligations | Fair Value Measurements - Level 3 Inputs | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 0 | 0 |
Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 1,081 | |
Asset-backed securities | Fair Value Measurements - Level 1 Inputs | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 0 | |
Asset-backed securities | Fair Value Measurements - Level 2 Inputs | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 1,081 | |
Asset-backed securities | Fair Value Measurements - Level 3 Inputs | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 0 | |
Collateralized mortgage obligations - government issued | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 22,902 | 31,213 |
Collateralized mortgage obligations - government issued | Fair Value Measurements - Level 1 Inputs | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 0 | 0 |
Collateralized mortgage obligations - government issued | Fair Value Measurements - Level 2 Inputs | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 22,902 | 31,213 |
Collateralized mortgage obligations - government issued | Fair Value Measurements - Level 3 Inputs | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 0 | 0 |
Collateralized mortgage obligations - government-sponsored enterprises | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 95,089 | 99,148 |
Collateralized mortgage obligations - government-sponsored enterprises | Fair Value Measurements - Level 1 Inputs | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 0 | 0 |
Collateralized mortgage obligations - government-sponsored enterprises | Fair Value Measurements - Level 2 Inputs | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | 95,089 | 99,148 |
Collateralized mortgage obligations - government-sponsored enterprises | Fair Value Measurements - Level 3 Inputs | ||
Fair Value, Assets and Liabilities Measured on a Recurring Basis | ||
Assets measured on a recurring basis, fair value | $ 0 | $ 0 |
Fair Value Disclosures (Measured on a Non-Recurring Basis) (Details) - USD ($) $ in Thousands |
9 Months Ended | 12 Months Ended |
---|---|---|
Sep. 30, 2017 |
Dec. 31, 2016 |
|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total gains (losses) on impaired loans | $ 16,298 | $ 13,365 |
Total gains (losses) on foreclosed properties | 1,472 | 1,472 |
Impaired loans | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets measured on a non-recurring basis, fair value | 16,298 | 13,365 |
Impaired loans | Fair Value Measurements - Level 1 Inputs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets measured on a non-recurring basis, fair value | 0 | 0 |
Impaired loans | Fair Value Measurements - Level 2 Inputs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets measured on a non-recurring basis, fair value | 7,637 | 12,268 |
Impaired loans | Fair Value Measurements - Level 3 Inputs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets measured on a non-recurring basis, fair value | 8,661 | 1,097 |
Foreclosed properties | Fair Value Measurements - Level 1 Inputs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets measured on a non-recurring basis, fair value | 0 | 0 |
Foreclosed properties | Fair Value Measurements - Level 2 Inputs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets measured on a non-recurring basis, fair value | 1,472 | 1,472 |
Foreclosed properties | Fair Value Measurements - Level 3 Inputs | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets measured on a non-recurring basis, fair value | $ 0 | $ 0 |
Fair Value Disclosures (Fair Value by Balance Sheet Groupings) (Details) - USD ($) $ in Thousands |
Sep. 30, 2017 |
Dec. 31, 2016 |
Sep. 30, 2016 |
Dec. 31, 2015 |
---|---|---|---|---|
Financial assets: | ||||
Cash and cash equivalents, carrying amount | $ 73,196 | $ 77,517 | $ 68,764 | $ 113,564 |
Securities available-for-sale, carrying amount | 131,130 | 145,893 | ||
Securities held-to-maturity, carrying amount | 38,873 | 38,612 | ||
Loans held for sale, carrying amount | 0 | 1,111 | ||
Loans and leases receivable, net amount, carrying amount | 1,446,790 | 1,429,763 | ||
Cash surrender value of life insurance, carrying amount | 39,988 | 39,048 | ||
Federal Home Loan Bank and Federal Reserve Bank stock, carrying amount | 5,083 | 2,131 | ||
Accrued interest receivable, carrying amount | 4,722 | 4,677 | ||
Interest rate swaps - assets, carrying amount | 1,380 | 352 | ||
Cash and cash equivalents, fair value | 73,218 | 77,517 | ||
Securities available-for-sale, fair value | 131,130 | 145,893 | ||
Held-to-maturity Securities, fair value | 39,274 | 38,520 | ||
Loans Held-for-sale, Fair Value Disclosure | 0 | 1,222 | ||
Loans and lease receivables, net, fair value | 1,427,071 | 1,447,044 | ||
Cash surrender value of life insurance, fair value | 39,988 | 39,048 | ||
Federal Home Loan Bank and Federal Reserve Bank stock, fair value | 5,083 | 2,131 | ||
Accrued interest receivable, fair value | 4,722 | 4,677 | ||
Interest rate swaps - assets, fair value | 1,380 | 352 | ||
Financial liabilities: | ||||
Deposits, carrying amount | 1,423,724 | 1,538,855 | ||
Federal Home Loan Bank and other borrowings, carrying amount | 167,884 | 59,676 | ||
Junior subordinated notes, carrying amount | 10,015 | 10,004 | ||
Accrued interest payable, carrying amount | 2,317 | 1,765 | ||
Standby letters of credit, carrying amount | 86 | 58 | ||
Deposits, fair value | 1,424,275 | 1,539,413 | ||
Federal Home Loan Bank and other borrowings fair value | 152,391 | 60,893 | ||
Junior subordinated notes, fair value | 8,829 | 9,072 | ||
Accrued interest payable, fair value | 2,317 | 1,765 | ||
Interest Rate Derivative Instruments Not Designated as Hedging Instruments, Liability at Fair Value | 1,380 | 352 | ||
Interest rate swaps - liabilities, fair value | 1,380 | 352 | ||
Standby letters of credit, fair value | 86 | 58 | ||
Fair Value Measurements - Level 1 Inputs | ||||
Financial assets: | ||||
Cash and cash equivalents, fair value | 56,487 | 55,622 | ||
Securities available-for-sale, fair value | 0 | 0 | ||
Held-to-maturity Securities, fair value | 0 | 0 | ||
Loans Held-for-sale, Fair Value Disclosure | 0 | 0 | ||
Loans and lease receivables, net, fair value | 0 | 0 | ||
Cash surrender value of life insurance, fair value | 39,988 | 0 | ||
Federal Home Loan Bank and Federal Reserve Bank stock, fair value | 0 | 0 | ||
Accrued interest receivable, fair value | 4,722 | 4,677 | ||
Interest rate swaps - assets, fair value | 0 | 0 | ||
Financial liabilities: | ||||
Deposits, fair value | 1,032,379 | 1,063,720 | ||
Federal Home Loan Bank and other borrowings fair value | 0 | 0 | ||
Junior subordinated notes, fair value | 0 | 0 | ||
Accrued interest payable, fair value | 2,317 | 1,765 | ||
Interest rate swaps - liabilities, fair value | 0 | 0 | ||
Standby letters of credit, fair value | 0 | 0 | ||
Fair Value Measurements - Level 2 Inputs | ||||
Financial assets: | ||||
Cash and cash equivalents, fair value | 16,731 | 21,895 | ||
Securities available-for-sale, fair value | 131,130 | 145,893 | ||
Held-to-maturity Securities, fair value | 39,274 | 38,520 | ||
Loans Held-for-sale, Fair Value Disclosure | 0 | 1,222 | ||
Loans and lease receivables, net, fair value | 7,637 | 12,268 | ||
Cash surrender value of life insurance, fair value | 0 | 39,048 | ||
Federal Home Loan Bank and Federal Reserve Bank stock, fair value | 0 | 2,131 | ||
Accrued interest receivable, fair value | 0 | 0 | ||
Interest rate swaps - assets, fair value | 1,380 | 352 | ||
Financial liabilities: | ||||
Deposits, fair value | 391,896 | 475,693 | ||
Federal Home Loan Bank and other borrowings fair value | 152,391 | 60,893 | ||
Junior subordinated notes, fair value | 0 | 0 | ||
Accrued interest payable, fair value | 0 | 0 | ||
Interest rate swaps - liabilities, fair value | 1,380 | 352 | ||
Standby letters of credit, fair value | 0 | 0 | ||
Fair Value Measurements - Level 3 Inputs | ||||
Financial assets: | ||||
Cash and cash equivalents, fair value | 0 | 0 | ||
Securities available-for-sale, fair value | 0 | 0 | ||
Held-to-maturity Securities, fair value | 0 | 0 | ||
Loans Held-for-sale, Fair Value Disclosure | 0 | 0 | ||
Loans and lease receivables, net, fair value | 1,419,434 | 1,434,776 | ||
Cash surrender value of life insurance, fair value | 0 | 0 | ||
Federal Home Loan Bank and Federal Reserve Bank stock, fair value | 5,083 | 0 | ||
Accrued interest receivable, fair value | 0 | 0 | ||
Interest rate swaps - assets, fair value | 0 | 0 | ||
Financial liabilities: | ||||
Deposits, fair value | 0 | 0 | ||
Federal Home Loan Bank and other borrowings fair value | 0 | 0 | ||
Junior subordinated notes, fair value | 8,829 | 9,072 | ||
Accrued interest payable, fair value | 0 | 0 | ||
Interest rate swaps - liabilities, fair value | 0 | 0 | ||
Standby letters of credit, fair value | $ 86 | $ 58 |
Fair Value Disclosures (Narrative Disclosures) (Details) - USD ($) |
9 Months Ended | 12 Months Ended |
---|---|---|
Sep. 30, 2017 |
Dec. 31, 2016 |
|
Fair Value Inputs, Assets, Quantitative Information | ||
Fair value, assets, level 1 to level 2 transfers | $ 0 | $ 0 |
Fair value, assets, level 2 to Level 1 transfers | 0 | 0 |
Fair value, assets, transfers into level 3 | 0 | 0 |
Fair value, assets, transfers out of level 3 | 0 | 0 |
Fair value, liabilities, level 1 to level 2 transfers | 0 | 0 |
Fair value, liabilities, level 2 to level 1 transfers | 0 | 0 |
Fair value, liabilities, transfers into level 3 | 0 | 0 |
Fair value, liabilities, transfers out of level 3 | 0 | 0 |
Commercial paper, at carrying value | 13,400,000 | 20,300,000 |
Certificates of deposit, at carrying value | $ 3,300,000 | 1,600,000 |
Minimum | ||
Fair Value Inputs, Assets, Quantitative Information | ||
Quantification of unobservable inputs for level 3 values for impaired loans | 13.00% | |
Maximum | ||
Fair Value Inputs, Assets, Quantitative Information | ||
Quantification of unobservable inputs for level 3 values for impaired loans | 90.00% | |
Weighted Average | ||
Fair Value Inputs, Assets, Quantitative Information | ||
Quantification of unobservable inputs for level 3 values for impaired loans | 20.00% | |
Impaired loans | ||
Fair Value Inputs, Assets, Quantitative Information | ||
Assets measured on a non-recurring basis, fair value | $ 16,298,000 | 13,365,000 |
Fair Value Measurements - Level 3 Inputs | Impaired loans | ||
Fair Value Inputs, Assets, Quantitative Information | ||
Assets measured on a non-recurring basis, fair value | 8,661,000 | 1,097,000 |
Fair Value Measurements - Level 3 Inputs | Foreclosed properties | ||
Fair Value Inputs, Assets, Quantitative Information | ||
Assets measured on a non-recurring basis, fair value | $ 0 | $ 0 |
Derivative Financial Instruments (Location and Fair Value of Derivative Instruments) (Details) - USD ($) $ in Thousands |
9 Months Ended | ||
---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Dec. 31, 2016 |
|
Derivatives not designated as hedging instruments, fair value | |||
Fair value of interest rate swaps | $ 1,380 | $ 352 | |
Interest rate swap contracts not designated as hedging instruments - liabilities, gross | $ 1,380 | $ 352 | |
Accrued interest receivable and other assets | |||
Derivatives not designated as hedging instruments, fair value | |||
Description of location of interest rate derivative instruments not designated as hedging instruments on balance sheet | Accrued interest receivable and other assets | Accrued interest receivable and other assets | |
Accrued interest payable and other liabilities | |||
Derivatives not designated as hedging instruments, fair value | |||
Description of location of interest rate derivative instruments not designated as hedging instruments on balance sheet | Accrued interest payable and other liabilities | Accrued interest payable and other liabilities |
Derivative Financial Instruments (Narrative Disclosures) (Details) - USD ($) $ in Thousands |
9 Months Ended | |
---|---|---|
Sep. 30, 2017 |
Dec. 31, 2016 |
|
Derivatives | ||
Fair value of interest rate swaps | $ 1,380 | $ 352 |
Interest rate swap contracts not designated as hedging instruments - liabilities, gross | 1,380 | $ 352 |
Derivative asset, fair value, amount offset against collateral | 0 | |
Derivative Instruments in Hedges, at Fair Value, Net | $ 0 | |
Interest rate derivatives, line item on income statement for gain (loss) | other non-interest income | |
To commercial borrowers, corporation receives fixed rates and pays floating rates | ||
Derivatives | ||
Fair value of interest rate swaps | $ 1,400 | |
To commercial borrowers, corporation receives fixed rates and pays floating rates | Minimum | ||
Derivatives | ||
Derivative, maturity date | Sep. 30, 2018 | |
To commercial borrowers, corporation receives fixed rates and pays floating rates | Maximum | ||
Derivatives | ||
Derivative, maturity date | Mar. 15, 2034 | |
To dealer countparties, corporation pays fixed rates and receives floating rates | ||
Derivatives | ||
Interest rate swap contracts not designated as hedging instruments - liabilities, gross | $ 1,400 | |
Interest rate derivative instruments not designated as hedging instruments at fair value, net | $ 1,400 | |
To dealer countparties, corporation pays fixed rates and receives floating rates | Minimum | ||
Derivatives | ||
Derivative, maturity date | Sep. 30, 2018 | |
To dealer countparties, corporation pays fixed rates and receives floating rates | Maximum | ||
Derivatives | ||
Derivative, maturity date | Mar. 15, 2034 | |
Not Designated as Hedging Instrument | To commercial borrowers, corporation receives fixed rates and pays floating rates | ||
Derivatives | ||
Notional value of interest rate swaps with various commercial borrowers | $ 52,300 | |
Not Designated as Hedging Instrument | To dealer countparties, corporation pays fixed rates and receives floating rates | ||
Derivatives | ||
Notional value of interest rate swaps with various commercial borrowers | $ 52,300 |
Regulatory Capital (Regulatory Capital Ratios) (Details) - USD ($) $ in Thousands |
Sep. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Compliance with Regulatory Capital Requirements under Banking Regulations | ||
Total capital (to risk-weighted assets) | $ 209,495 | $ 204,117 |
Total capital to risk-weighted assets | 11.91% | 11.74% |
Total capital, Minimum Required for Capital Adequacy Purposes | $ 140,737 | $ 139,101 |
Total capital to risk-weighted assets, Minimum Required for Capital Adequacy Purposes | 8.00% | 8.00% |
Capital Required for Capital Adequacy Plus Capital Conservation Buffer | $ 162,727 | $ 149,968 |
Capital Required for Capital Adequacy Plus Conservation Buffer to Risk Weighted Assets | 9.25% | 8.625% |
Tier 1 capital (to risk-weighted assets) | $ 165,873 | $ 160,964 |
Tier 1 capital to risk-weighted assets | 9.43% | 9.26% |
Tier 1 capital, Minimum Required for Capital Adequacy Purposes | $ 105,553 | $ 104,326 |
Tier 1 capital to risk-weighted assets, Minimum Required for Capital Adequacy Purposes | 6.00% | 6.00% |
Tier One Risk Based Capital Required for Capital Adequacy Plus Capital Conservation Buffer | $ 127,543 | $ 115,193 |
Tier One Risk Based Capital Required for Capital Adequacy Plus Conservation Buffer to Risk Weighted Assets | 7.25% | 6.625% |
Common equity tier 1 capital | $ 155,858 | $ 150,960 |
Common equity tier 1 capital to risk-weighted assets | 8.86% | 8.68% |
Common equity tier 1 capital, Minimum Required for Capital Adequacy Purposes | $ 79,164 | $ 78,244 |
Common equity tier 1 capital to risk-weighted assets, Minimum Required for Capital Adequacy Purposes | 4.50% | 4.50% |
Common Equity Tier One Capital Required for Capital Adequacy Plus Capital Conservation Buffer | $ 101,155 | $ 89,111 |
Common Equity Tier One Capital Required for Capital Adequacy Plus Conservation Buffer to Risk Weighted Assets | 5.75% | 5.125% |
Tier 1 leverage capital (to adjusted assets) | $ 165,873 | $ 160,964 |
Tier 1 leverage capital to average assets | 9.39% | 9.07% |
Tier 1 leverage capital, Minimum Required for Capital Adequacy Purposes | $ 70,654 | $ 70,985 |
Tier 1 leverage capital to average assets, Minimum Required for Capital Adequacy Purposes | 4.00% | 4.00% |
Tier One Leverage Capital Required for Capital Adequacy Plus Capital Conservation Buffer | $ 70,654 | $ 70,985 |
Tier One Leverage Capital Required for Capital Adequacy Plus Conservation Buffer to Risk Weighted Assets | 4.00% | 4.00% |
First Business Bank | ||
Compliance with Regulatory Capital Requirements under Banking Regulations | ||
Total capital (to risk-weighted assets) | $ 205,877 | $ 147,811 |
Total capital to risk-weighted assets | 11.75% | 11.55% |
Total capital, Minimum Required for Capital Adequacy Purposes | $ 140,132 | $ 102,362 |
Total capital to risk-weighted assets, Minimum Required for Capital Adequacy Purposes | 8.00% | 8.00% |
Capital Required for Capital Adequacy Plus Capital Conservation Buffer | $ 162,027 | $ 110,360 |
Capital Required for Capital Adequacy Plus Conservation Buffer to Risk Weighted Assets | 9.25% | 8.625% |
Total capital, Minimum Required to be Well Capitalized Under Prompt Corrective Action Requirements | $ 175,164 | $ 127,953 |
Total capital to risk-weighted assets, Minimum Required to be Well Capitalized Under Prompt Corrective Action Requirements | 10.00% | 10.00% |
Tier 1 capital (to risk-weighted assets) | $ 185,954 | $ 134,208 |
Tier 1 capital to risk-weighted assets | 10.62% | 10.49% |
Tier 1 capital, Minimum Required for Capital Adequacy Purposes | $ 105,099 | $ 76,772 |
Tier 1 capital to risk-weighted assets, Minimum Required for Capital Adequacy Purposes | 6.00% | 6.00% |
Tier One Risk Based Capital Required for Capital Adequacy Plus Capital Conservation Buffer | $ 126,994 | $ 84,769 |
Tier One Risk Based Capital Required for Capital Adequacy Plus Conservation Buffer to Risk Weighted Assets | 7.25% | 6.625% |
Tier 1 capital, Minimum Required to be Well Capitalized Under Prompt Corrective Action Requirements | $ 140,132 | $ 102,362 |
Tier 1 capital to risk weighted assets, Minimum Required to be Well Capitalized Under Prompt Corrective Action Requirements | 8.00% | 8.00% |
Common equity tier 1 capital | $ 185,954 | $ 134,208 |
Common equity tier 1 capital to risk-weighted assets | 10.62% | 10.49% |
Common equity tier 1 capital, Minimum Required for Capital Adequacy Purposes | $ 78,824 | $ 57,579 |
Common equity tier 1 capital to risk-weighted assets, Minimum Required for Capital Adequacy Purposes | 4.50% | 4.50% |
Common Equity Tier One Capital Required for Capital Adequacy Plus Capital Conservation Buffer | $ 100,720 | $ 65,576 |
Common Equity Tier One Capital Required for Capital Adequacy Plus Conservation Buffer to Risk Weighted Assets | 5.75% | 5.125% |
Common equity tier 1 capital, Minimum Required to Be Well Capitalized Under Prompt Corrective Action Requirements | $ 113,857 | $ 83,170 |
Common equity tier 1 capital to risk-weighted assets, Minimum Required to Be Well Capitalized Under Prompt Corrective Action Requirements | 6.50% | 6.50% |
Tier 1 leverage capital (to adjusted assets) | $ 185,954 | $ 134,208 |
Tier 1 leverage capital to average assets | 10.56% | 10.40% |
Tier 1 leverage capital, Minimum Required for Capital Adequacy Purposes | $ 70,409 | $ 51,600 |
Tier 1 leverage capital to average assets, Minimum Required for Capital Adequacy Purposes | 4.00% | 4.00% |
Tier One Leverage Capital Required for Capital Adequacy Plus Capital Conservation Buffer | $ 70,409 | $ 51,600 |
Tier One Leverage Capital Required for Capital Adequacy Plus Conservation Buffer to Risk Weighted Assets | 4.00% | 4.00% |
Tier 1 leverage capital, Minimum Required to be Well Capitalized Under Prompt Corrective Action Requirements | $ 88,011 | $ 64,500 |
Tier 1 leverage capital to average assets, Minimum Required to be Well Capitalized Under Prompt Corrective Action Requirements | 5.00% | 5.00% |
First Business Bank - Milwaukee | ||
Compliance with Regulatory Capital Requirements under Banking Regulations | ||
Total capital (to risk-weighted assets) | $ 24,347 | |
Total capital to risk-weighted assets | 11.02% | |
Total capital, Minimum Required for Capital Adequacy Purposes | $ 17,680 | |
Total capital to risk-weighted assets, Minimum Required for Capital Adequacy Purposes | 8.00% | |
Capital Required for Capital Adequacy Plus Capital Conservation Buffer | $ 19,062 | |
Capital Required for Capital Adequacy Plus Conservation Buffer to Risk Weighted Assets | 8.625% | |
Total capital, Minimum Required to be Well Capitalized Under Prompt Corrective Action Requirements | $ 22,101 | |
Total capital to risk-weighted assets, Minimum Required to be Well Capitalized Under Prompt Corrective Action Requirements | 10.00% | |
Tier 1 capital (to risk-weighted assets) | $ 22,323 | |
Tier 1 capital to risk-weighted assets | 10.10% | |
Tier 1 capital, Minimum Required for Capital Adequacy Purposes | $ 13,260 | |
Tier 1 capital to risk-weighted assets, Minimum Required for Capital Adequacy Purposes | 6.00% | |
Tier One Risk Based Capital Required for Capital Adequacy Plus Capital Conservation Buffer | $ 14,642 | |
Tier One Risk Based Capital Required for Capital Adequacy Plus Conservation Buffer to Risk Weighted Assets | 6.625% | |
Tier 1 capital, Minimum Required to be Well Capitalized Under Prompt Corrective Action Requirements | $ 17,680 | |
Tier 1 capital to risk weighted assets, Minimum Required to be Well Capitalized Under Prompt Corrective Action Requirements | 8.00% | |
Common equity tier 1 capital | $ 22,323 | |
Common equity tier 1 capital to risk-weighted assets | 10.10% | |
Common equity tier 1 capital, Minimum Required for Capital Adequacy Purposes | $ 9,945 | |
Common equity tier 1 capital to risk-weighted assets, Minimum Required for Capital Adequacy Purposes | 4.50% | |
Common Equity Tier One Capital Required for Capital Adequacy Plus Capital Conservation Buffer | $ 11,327 | |
Common Equity Tier One Capital Required for Capital Adequacy Plus Conservation Buffer to Risk Weighted Assets | 5.125% | |
Common equity tier 1 capital, Minimum Required to Be Well Capitalized Under Prompt Corrective Action Requirements | $ 14,365 | |
Common equity tier 1 capital to risk-weighted assets, Minimum Required to Be Well Capitalized Under Prompt Corrective Action Requirements | 6.50% | |
Tier 1 leverage capital (to adjusted assets) | $ 22,323 | |
Tier 1 leverage capital to average assets | 9.15% | |
Tier 1 leverage capital, Minimum Required for Capital Adequacy Purposes | $ 9,758 | |
Tier 1 leverage capital to average assets, Minimum Required for Capital Adequacy Purposes | 4.00% | |
Tier One Leverage Capital Required for Capital Adequacy Plus Capital Conservation Buffer | $ 9,758 | |
Tier One Leverage Capital Required for Capital Adequacy Plus Conservation Buffer to Risk Weighted Assets | 4.00% | |
Tier 1 leverage capital, Minimum Required to be Well Capitalized Under Prompt Corrective Action Requirements | $ 12,198 | |
Tier 1 leverage capital to average assets, Minimum Required to be Well Capitalized Under Prompt Corrective Action Requirements | 5.00% | |
Alterra Bank | ||
Compliance with Regulatory Capital Requirements under Banking Regulations | ||
Total capital (to risk-weighted assets) | $ 31,699 | |
Total capital to risk-weighted assets | 13.27% | |
Total capital, Minimum Required for Capital Adequacy Purposes | $ 19,106 | |
Total capital to risk-weighted assets, Minimum Required for Capital Adequacy Purposes | 8.00% | |
Capital Required for Capital Adequacy Plus Capital Conservation Buffer | $ 20,599 | |
Capital Required for Capital Adequacy Plus Conservation Buffer to Risk Weighted Assets | 8.625% | |
Total capital, Minimum Required to be Well Capitalized Under Prompt Corrective Action Requirements | $ 23,882 | |
Total capital to risk-weighted assets, Minimum Required to be Well Capitalized Under Prompt Corrective Action Requirements | 10.00% | |
Tier 1 capital (to risk-weighted assets) | $ 28,685 | |
Tier 1 capital to risk-weighted assets | 12.01% | |
Tier 1 capital, Minimum Required for Capital Adequacy Purposes | $ 14,329 | |
Tier 1 capital to risk-weighted assets, Minimum Required for Capital Adequacy Purposes | 6.00% | |
Tier One Risk Based Capital Required for Capital Adequacy Plus Capital Conservation Buffer | $ 15,822 | |
Tier One Risk Based Capital Required for Capital Adequacy Plus Conservation Buffer to Risk Weighted Assets | 6.625% | |
Tier 1 capital, Minimum Required to be Well Capitalized Under Prompt Corrective Action Requirements | $ 19,106 | |
Tier 1 capital to risk weighted assets, Minimum Required to be Well Capitalized Under Prompt Corrective Action Requirements | 8.00% | |
Common equity tier 1 capital | $ 28,685 | |
Common equity tier 1 capital to risk-weighted assets | 12.01% | |
Common equity tier 1 capital, Minimum Required for Capital Adequacy Purposes | $ 10,747 | |
Common equity tier 1 capital to risk-weighted assets, Minimum Required for Capital Adequacy Purposes | 4.50% | |
Common Equity Tier One Capital Required for Capital Adequacy Plus Capital Conservation Buffer | $ 12,240 | |
Common Equity Tier One Capital Required for Capital Adequacy Plus Conservation Buffer to Risk Weighted Assets | 5.125% | |
Common equity tier 1 capital, Minimum Required to Be Well Capitalized Under Prompt Corrective Action Requirements | $ 15,524 | |
Common equity tier 1 capital to risk-weighted assets, Minimum Required to Be Well Capitalized Under Prompt Corrective Action Requirements | 6.50% | |
Tier 1 leverage capital (to adjusted assets) | $ 28,685 | |
Tier 1 leverage capital to average assets | 10.58% | |
Tier 1 leverage capital, Minimum Required for Capital Adequacy Purposes | $ 10,842 | |
Tier 1 leverage capital to average assets, Minimum Required for Capital Adequacy Purposes | 4.00% | |
Tier One Leverage Capital Required for Capital Adequacy Plus Capital Conservation Buffer | $ 10,842 | |
Tier One Leverage Capital Required for Capital Adequacy Plus Conservation Buffer to Risk Weighted Assets | 4.00% | |
Tier 1 leverage capital, Minimum Required to be Well Capitalized Under Prompt Corrective Action Requirements | $ 13,552 | |
Tier 1 leverage capital to average assets, Minimum Required to be Well Capitalized Under Prompt Corrective Action Requirements | 5.00% |
Regulatory Capital (Narrative Disclosures) (Details) |
9 Months Ended |
---|---|
Sep. 30, 2017 | |
Regulatory Capital Requirements [Abstract] | |
Description of possible effects of noncompliance or less than adequately capitalized | Failure to meet minimum capital requirements can result in certain mandatory, and possibly additional discretionary actions on the part of regulators, that if undertaken, could have a direct material effect on the Bank’s assets, liabilities and certain off-balance-sheet items as calculated under regulatory practices. |
Capital Conservation Buffer, Initial Phase In Percent | 0.625% |
Capital Conservation Buffer, Yearly Phase-In Percent Increase | 0.625% |
Capital Conservation Buffer, Fully Phased-In Percent | 2.50% |