UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_______________________________

FORM 10-Q

_______________________________

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

For the quarterly period endedJune 30, 2018

OR

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

For the transition period from ______ to ______

Commission File Number:001-37391

_______________________________

Reliant Bancorp, Inc.

(Exact name of registrant as specified in its charter)

_______________________________

Tennessee	37-1641316
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
1736 Carothers Parkway, Suite 100 Brentwood, Tennessee	37027
(Address of principal executive offices)	(Zip Code)
(615) 221-2020
(Registrant’s telephone number, including area code)

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

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

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

Large Accelerated Filer ¨	Accelerated Filer ý
Non-Accelerated Filer ¨	Smaller Reporting Company ¨
Emerging growth company ý

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

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

The number of shares outstanding of the registrant’s common stock, par value $1.00 per share, as of August 7, 2018 was 11,527,094.

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION		4
Item 1.	Consolidated Financial Statements (Unaudited)	4
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	38
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	59
Item 4.	Controls and Procedures	59
PART II – OTHER INFORMATION		60
Item 1.	Legal Proceedings	60
Item 1A.	Risk Factors	60
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	60
Item 3.	Defaults Upon Senior Securities	60
Item 4.	Mine Safety Disclosures	60
Item 5.	Other Information	60
Item 6.	Exhibits	61
SIGNATURES		62

2

FORWARD-LOOKING STATEMENTS

Reliant Bancorp, Inc. (“Reliant Bancorp”) may from time to time make written or oral statements, including statements contained in this report (including, without limitation, certain statements in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Item 2), that constitute forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”). The words “believe,” “anticipate,” “expect,” “may,” “will,” “assume,” “should,” “predict,” “could,” “would,” “intend,” “targets,” “estimates,” “projects,” “plans,” “potential” and other similar words and expressions of the future are intended to identify such forward-looking statements, but other statements not based on historical information may also be considered forward-looking, including statements about the benefits to Reliant Bancorp of the merger with Community First, Inc. (“Community First”), Reliant Bancorp’s future financial and operating results and Reliant Bancorp’s plans, objectives and intentions. All forward-looking statements are subject to risks, uncertainties and other factors that may cause the actual results, performance or achievements of Reliant Bancorp to differ materially from any results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others:  

(i) the effect of interest rate increases on the cost of deposits;

(ii) unanticipated weakness in loan demand or loan pricing;

(iii) greater than anticipated adverse conditions in the national or local economies in which we operate, including Middle Tennessee;

(iv) our ability to successfully integrate Community First’s business and operations with that of Reliant Bank;

(v) lack of strategic growth opportunities or our failure to execute on those opportunities;

(vi) deterioration in the financial condition of borrowers resulting in significant increases in loan losses and provisions for those losses;

(vii) the ability to grow and retain low-cost core deposits and retain large, uninsured deposits;

(viii) the impact of competition with other financial institutions, including pricing pressures and the resulting impact on Reliant Bancorp’s results, including as a result of compression to net interest margin;

(ix) our ability to effectively manage problem credits;

(x) our ability to successfully implement efficiency initiatives on time and in amounts projected;

(xi) our ability to successfully develop and market new products and technology;

(xii) the vulnerability of Reliant Bank’s network and online banking portals, and the systems of parties with whom we contract, to unauthorized access, computer viruses, phishing schemes, spam attacks, human error, natural disasters, power loss, and other security breaches; and

(xiii) changes in laws or regulations.

You should also consider carefully the risk factors discussed in Part I of our most recent Form 10-K, which address additional factors that could cause our actual results to differ from those set forth in the forward-looking statements and could materially and adversely affect our business, operating results and financial condition. The risks discussed in this quarterly report are factors that, individually or in the aggregate, management believes could cause our actual results to differ materially from expected and historical results. You should understand that it is not possible to predict or identify all such factors. Consequently, you should not consider such disclosures to be a complete discussion of all potential risks or uncertainties. Factors not here or there listed may develop or, if currently extant, we may not have yet recognized them.

The forward-looking statements speak only as of the date on which they are made, and, except to the extent required by federal securities laws, we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

3

PART I – FINANCIAL INFORMATION

Item 1.    Consolidated Financial Statements (Unaudited)

4

RELIANT BANCORP, INC.

CONSOLIDATED BALANCE SHEETS

JUNE 30, 2018 (UNAUDITED) AND DECEMBER 31, 2017

(Dollar amounts in thousands except per share amounts)

	June 30, 2018			December 31, 2017
	Unaudited			Audited
ASSETS
Cash and due from banks	$	32,321		$	20,497
Federal funds sold	381			171
Total cash and cash equivalents	32,702			20,668
Securities available for sale	308,069			220,201
Loans, net	1,132,290			762,488
Mortgage loans held for sale, net	31,163			45,322
Accrued interest receivable	7,474			5,744
Premises and equipment, net	19,955			9,790
Restricted equity securities, at cost	11,677			7,774
Other real estate, net	2,060			—
Cash surrender value of life insurance contracts	44,927			33,663
Deferred tax assets, net	7,913			1,099
Goodwill	43,627			11,404
Core deposit intangibles	8,693			1,280
Other assets	9,108			5,601
TOTAL ASSETS	$	1,659,658		$	1,125,034
LIABILITIES AND STOCKHOLDERS’ EQUITY
LIABILITIES
Deposits
Demand	$	225,360		$	131,996
Interest-bearing demand	140,201			88,230
Savings and money market deposit accounts	352,724			205,230
Time	615,990			458,063
Total deposits	1,334,275			883,519
Accrued interest payable	801			305
Subordinated debentures	11,562			—
Federal Home Loan Bank advances	102,874			96,747
Dividends payable	919			542
Other liabilities	6,887			3,784
TOTAL LIABILITIES	1,457,318			984,897
STOCKHOLDERS’ EQUITY
Preferred stock, $1 par value; 10,000,000 shares authorized; no shares issued to date	—			—
Common stock, $1 par value; 30,000,000 shares authorized; 11,482,965 and 9,034,439 shares issued and outstanding at June 30, 2018, and December 31, 2017, respectively	11,483			9,034
Additional paid-in capital	172,686			112,437
Retained earnings	21,090			17,189
Accumulated other comprehensive gain (loss)	(2,919		)	1,477
TOTAL STOCKHOLDERS’ EQUITY	202,340			140,137
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	1,659,658		$	1,125,034

See accompanying notes to consolidated financial statements

5

RELIANT BANCORP, INC.

CONSOLIDATED STATEMENTS OF INCOME

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2018 AND 2017

(Dollar amounts in thousands except per share amounts)

(Unaudited)

	Three Months Ended June 30,				Six Months Ended June 30,
	2018		2017		2018		2017
INTEREST INCOME
Interest and fees on loans	$	14,066	$	8,333	$	27,624	$	16,115
Interest and fees on loans held for sale	326		115		807		209
Interest on investment securities, taxable	453		186		960		335
Interest on investment securities, nontaxable	1,708		946		3,212		1,774
Federal funds sold and other	277		124		589		244
TOTAL INTEREST INCOME	16,830		9,704		33,192		18,677
INTEREST EXPENSE
Deposits
Demand	84		46		161		89
Savings and money market deposit accounts	574		200		1,052		350
Time	2,199		853		4,195		1,546
Federal Home Loan Bank advances and other	397		102		669		218
Subordinated debentures	172		—		329		—
TOTAL INTEREST EXPENSE	3,426		1,201		6,406		2,203
NET INTEREST INCOME	13,404		8,503		26,786		16,474
PROVISION FOR LOAN LOSSES	300		245		437		655
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES	13,104		8,258		26,349		15,819
NONINTEREST INCOME
Service charges on deposit accounts	900		317		1,671		627
Gains on mortgage loans sold, net	957		638		2,662		1,180
Gain on securities transactions, net	25		23		25		59
Gain on sale of other real estate	20		1		109		25
Other	352		252		778		479
TOTAL NONINTEREST INCOME	2,254		1,231		5,245		2,370
NONINTEREST EXPENSE
Salaries and employee benefits	6,613		4,485		13,567		8,754
Occupancy	1,210		870		2,439		1,632
Information technology	1,249		679		2,598		1,192
Advertising and public relations	141		48		230		123
Audit, legal and consulting	816		308		1,439		601
Federal deposit insurance	224		121		420		220
Merger expenses	2,483		—		2,660		—
Other operating	1,305		757		2,850		1,615
TOTAL NONINTEREST EXPENSE	14,041		7,268		26,203		14,137
INCOME BEFORE PROVISION FOR INCOME TAXES	1,317		2,221		5,391		4,052
INCOME TAX EXPENSE	115		427		912		699
CONSOLIDATED NET INCOME	1,202		1,794		4,479		3,353
NONCONTROLLING INTEREST IN NET LOSS OF SUBSIDIARY	937		393		1,401		892
NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS	$	2,139	$	2,187	$	5,880	$	4,245
Basic net income attributable to common shareholders, per share	$	0.19	$	0.28	$	0.52	$	0.55
Diluted net income attributable to common shareholders, per share	$	0.19	$	0.28	$	0.51	$	0.54

See accompanying notes to consolidated financial statements

6

RELIANT BANCORP, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2018 AND 2017

(Dollar amounts in thousands except per share amounts)

(Unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
	2018			2017			2018			2017
Consolidated net income	$	1,202		$	1,794		$	4,479		$	3,353
Other comprehensive income (loss)
Net unrealized gains (losses) on available-for-sale securities, net of tax of ($31) and ($871) for the three months ended June 30, 2018 and 2017, respectively, and $1,548 and ($1,016) for the six months ended June 30, 2018 and 2017, respectively	36			1,499			(4,378		)	1,639
Reclassification adjustment for gains included in net income, net of tax of ($7) and ($9) for the three months ended June 30, 2018 and 2017, respectively, and ($7) and ($23) for the six months ended June 30, 2018 and 2017, respectively	(18		)	(14		)	(18		)	(36		)
TOTAL OTHER COMPREHENSIVE INCOME (LOSS)	18			1,485			(4,396		)	1,603
TOTAL COMPREHENSIVE INCOME	$	1,220		$	3,279		$	83		$	4,956

See accompanying notes to consolidated financial statements

7

RELIANT BANCORP, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

FOR THE SIX MONTHS ENDED JUNE 30, 2018 AND 2017

(Dollar amounts in thousands except per share amounts)

(Unaudited)

	COMMON STOCK					ADDITIONAL PAID-IN CAPITAL			RETAINED EARNINGS			ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)			NONCONTROLLING INTEREST			TOTAL
	SHARES		AMOUNT
BALANCE - JANUARY 1, 2017	7,778,309		$	7,778		$	89,045		$	12,212		$	(2,116	)	$	—		$	106,919
Stock based compensation expense	—		—			195			—			—			—			195
Exercise of stock options	49,253		50			518			—			—			—			568
Restricted stock awards	15,000		15			(15		)	—			—			—			—
Restricted stock forfeiture	(3,000	)	(3		)	3			—			—			—			—
Noncontrolling interest contributions	—		—			—			—			—			892			892
Cash dividend declared to common shareholders	—		—			—			(941		)	—			—			(941		)
Net income (loss)	—		—			—			4,245			—			(892		)	3,353
Other comprehensive income	—		—			—			—			1,603			—			1,603
BALANCE - JUNE 30, 2017	7,839,562		$	7,840		$	89,746		$	15,516		$	(513	)	$	—		$	112,589
BALANCE - JANUARY 1, 2018	9,034,439		$	9,034		$	112,437		$	17,189		$	1,477		$	—		$	140,137
Stock based compensation expense	—		—			372			—			—			—			372
Exercise of stock options	25,582		25			318			—			—			—			343
Restricted stock awards	7,500		8			(8		)	—			—			—			—
Restricted stock forfeiture	(1,000	)	(1		)	1			—			—			—			—
Conversion shares issued to shareholders of Community First, Inc.	2,416,444		2,417			59,566			—			—			—			61,983
Noncontrolling interest contributions	—		—			—			—			—			1,401			1,401
Cash dividend declared to common shareholders	—		—			—			(1,979		)	—			—			(1,979		)
Net income (loss)	—		—			—			5,880			—			(1,401		)	4,479
Other comprehensive loss	—		—			—			—			(4,396		)	—			(4,396		)
BALANCE - JUNE 30, 2018	11,482,965		$	11,483		$	172,686		$	21,090		$	(2,919	)	$	—		$	202,340

See accompanying notes to consolidated financial statements

8

RELIANT BANCORP, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED JUNE 30, 2018 AND 2017

(Dollar amounts in thousands except per share amounts)

(Unaudited)

	2018			2017
OPERATING ACTIVITIES
Consolidated net income	$	4,479		$	3,353
Adjustments to reconcile consolidated net income to net cash provided by (used in) operating activities
Provision for loan losses	437			655
Deferred income taxes (benefit)	(374		)	(54		)
Depreciation and amortization of premises and equipment	792			513
Net amortization of securities	1,515			959
Other amortization (accretion)	40			—
Net realized (gains) losses on sales of securities	(25		)	(59		)
Gains on mortgage loans sold, net	(2,662		)	(1,180		)
Stock-based compensation expense	372			195
Realization of gain on other real estate	(109		)	(25		)
Increase in cash surrender value of life insurance contracts	(600		)	(376		)
Mortgage loans originated for resale	(70,064		)	(28,207		)
Proceeds from sale of mortgage loans	87,795			29,187
Amortization of core deposit intangible	475			178
Change in
Accrued interest receivable	(565		)	(512		)
Other assets	(856		)	5,534
Accrued interest payable	496			60
Other liabilities	(1,321		)	1,407
TOTAL ADJUSTMENTS	15,346			8,275
NET CASH PROVIDED BY OPERATING ACTIVITIES	19,825			11,628
INVESTING ACTIVITIES
Cash received from merger	33,128			—
Activities in available for sale securities
Purchases	(103,323		)	(58,778		)
Sales	92,991			18,688
Maturities, prepayments and calls	6,862			4,302
Purchases of restricted equity securities	(2,177		)	(22		)
Loan originations and payments, net	(58,259		)	(53,403		)
Purchase of buildings, leasehold improvements, and equipment	(1,372		)	(1,141		)
Proceeds from sale of other real estate	670			—
Purchase of life insurance contracts	—			(4,000		)
NET CASH USED IN INVESTING ACTIVITIES	(31,480		)	(94,354		)
FINANCING ACTIVITIES
Net change in deposits	18,261			76,180
Net change in federal funds purchased	—			(3,671		)
Net change in advances from Federal Home Loan Bank	6,127			12,623
Issuance of common stock	343			568
Noncontrolling interest contributions received	560			1,045
Cash dividends paid on common stock	(1,602		)	(1,711		)
NET CASH PROVIDED BY FINANCING ACTIVITIES	23,689			85,034
NET CHANGE IN CASH AND CASH EQUIVALENTS	12,034			2,308
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD	20,668			24,243
CASH AND CASH EQUIVALENTS - END OF PERIOD	$	32,702		$	26,551
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for
Interest	$	5,910		$	2,143
Taxes	$	1,623		$	526
Non-cash investing and financing activities
Unrealized gain (loss) on securities available-for-sale	$	(6,499	)	$	3,088
Unrealized gain (loss) on derivatives	$	598		$	(492	)
Change in due to/from noncontrolling interest	$	1,401		$	(153	)
Loans foreclosed and transferred to other real estate owned and foreclosed assets	$	1,060		$	—

See accompanying notes to consolidated financial statements

9

RELIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2018 (UNAUDITED) AND DECEMBER 31, 2017

(Dollar amounts in thousands except per share amounts)

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accounting and reporting policies of Reliant Bancorp, Inc. and Subsidiaries (“the Company”) conform to accounting principles generally accepted in the United States of America and to general practices within the banking industry. The following is a brief summary of the significant policies.

Nature of Operations

The Company began organizational activities in 2005. The Company provides financial services through its offices in Williamson, Robertson, Davidson, Sumner, Rutherford, Maury, Hickman and Hamilton Counties in Tennessee. Its primary deposit products are checking, savings, and term certificate accounts, and its primary lending products are commercial and residential construction loans, commercial loans, installment loans and lines secured by home equity. Substantially all loans are secured by specific items of collateral including commercial and residential real estate, business assets, and consumer assets. Commercial loans are expected to be repaid from cash flow from operations of businesses. On January 1, 2018, Community First, Inc. (“Community First”) a community banking organization headquartered in Columbia, Tennessee was merged with and into the Company. See Note 12.

Basis of Presentation

The accompanying unaudited consolidated financial statements have been prepared in accordance with instructions to Form 10-Q and therefore do not include all information and footnotes necessary for a fair presentation of financial position, results of operations, and cash flows in conformity with U.S. generally accepted accounting principles (U.S. GAAP).  All adjustments consisting of normally recurring accruals that, in the opinion of management, are necessary for a fair presentation of the financial position and results of operations for the periods covered by the report have been included.  The accompanying unaudited consolidated financial statements should be read in conjunction with the Reliant Bancorp, Inc.’s consolidated financial statements and related notes appearing in Reliant Bancorp, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2017.

The consolidated financial statements as of and for the periods presented include the accounts of Reliant Bancorp, Inc., its wholly-owned subsidiary, Community First TRUPS Holding Company (“TRUPS”), its second wholly-owned subsidiary, Reliant Bank (the “Bank”), and the Bank’s 51% controlled subsidiary, Reliant Mortgage Ventures, LLC, collectively (the “Company”). As described in the notes to our annual consolidated financial statements, Reliant Mortgage Ventures, LLC is considered a variable interest entity for which the Bank is deemed to be the primary beneficiary. All significant intercompany balances and transactions have been eliminated in consolidation. As described in Note 12, Reliant Bancorp, Inc. and Community First, Inc. merged effective January 1, 2018. The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America ("U.S. GAAP") and to general practices in the banking industry.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions based on available information. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to determination of the allowance for loan losses, the valuation of other real estate, the valuation of debt and equity securities, the valuation of deferred tax assets and fair values of financial instruments.

10

RELIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

JUNE 30, 2018 (UNAUDITED) AND DECEMBER 31, 2017

(Dollar amounts in thousands except per share amounts)

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Use of Estimates (Continued)

The consolidated financial statements as of June 30, 2018, and for the three and six months endedJune 30, 2018 and 2017, included herein have not been audited. The accounting and reporting policies of the Company conform to U.S. generally accepted accounting principles and Article 10 of Regulation S-X. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission, although the Company believes that the disclosures made are adequate to make the information not misleading.

The accompanying consolidated financial statements reflect all adjustments, which are, in the opinion of management, necessary to present a fair statement of the results for the interim periods presented. Such adjustments are of a normal recurring nature. The Company evaluates subsequent events through the date of filing. Certain prior period amounts have been reclassified to conform to the current period presentation. The results for the three and six months endedJune 30, 2018 are not necessarily indicative of the results that may be expected for the year ending December 31, 2018.

NOTE 2 - SECURITIES

The amortized cost and fair value of available for sale securities and the related gross unrealized gains and losses recognized in accumulated other comprehensive loss at June 30, 2018 and December 31, 2017 were as follows:

	June 30, 2018
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
U. S. Treasury and other U. S. government agencies	$	32,617	$	—	$	(584	)	$	32,033
State and municipal	243,359		901		(4,284		)	239,976
Corporate bonds	3,130		3		(87		)	3,046
Mortgage backed securities	29,938		5		(429		)	29,514
Time deposits	3,500		—		—			3,500
Total	$	312,544	$	909	$	(5,384	)	$	308,069

	December 31, 2017
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
U. S. Treasury and other U. S. government agencies	$	17,339	$	45	$	(96	)	$	17,288
State and municipal	189,576		3,081		(905)			191,752
Corporate bonds	1,500		5		(13)			1,492
Mortgage backed securities	6,262		3		(96)			6,169
Time deposits	3,500		—		—			3,500
Total	$	218,177	$	3,134	$	(1,110	)	$	220,201

11

RELIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

JUNE 30, 2018 (UNAUDITED) AND DECEMBER 31, 2017

(Dollar amounts in thousands except per share amounts)

NOTE 2 - SECURITIES (CONTINUED)

Securities pledged at June 30, 2018 and December 31, 2017 had a carrying amount of $74,022 and $78,220, respectively, and were pledged to collateralize Federal Home Loan Bank advances, Federal Reserve advances and municipal deposits.

At June 30, 2018 and December 31, 2017, there were no holdings of securities of any one issuer in an amount greater than 10% of stockholders’ equity.

The fair value of available for sale debt securities at June 30, 2018 by contractual maturity are provided below. Securities not due at a single maturity date, primarily mortgage backed securities, are shown separately.

	Amortized Cost		Estimated Fair Value
Due within one year	$	3,582	$	3,581
Due in one to five years	7,326		7,297
Due in five to ten years	15,401		15,141
Due after ten years	256,297		252,536
Mortgage backed securities	29,938		29,514
Total	$	312,544	$	308,069

The following table shows available for sale securities with unrealized losses and their estimated fair value aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of June 30, 2018:

	Less than 12 months				12 months or more				Total
	Estimated Fair Value		Unrealized Loss		Estimated Fair Value		Unrealized Loss		Estimated Fair Value		Unrealized Loss
Description of Securities
U. S. Treasury and other U. S. government agencies	$	30,033	$	547	$	1,654	$	37	$	31,687	$	584
State and municipal	142,013		2,555		34,667		1,729		176,680		4,284
Corporate bonds	2,051		79		492		8		2,543		87
Mortgage backed securities	26,874		325		2,266		104		29,140		429
Total temporarily impaired	$	200,971	$	3,506	$	39,079	$	1,878	$	240,050	$	5,384

12

RELIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

JUNE 30, 2018 (UNAUDITED) AND DECEMBER 31, 2017

(Dollar amounts in thousands except per share amounts)

NOTE 2 - SECURITIES (CONTINUED)

The following table shows available for sale securities with unrealized losses and their estimated fair value aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of December 31, 2017:

	Less than 12 months				12 months or more				Total
	Estimated Fair Value		Unrealized Loss		Estimated Fair Value		Unrealized Loss		Estimated Fair Value		Unrealized Loss
Description of Securities
U. S. Treasury and other U. S. government agencies	$	9,057	$	74	$	1,345	$	22	$	10,402	$	96
State and municipal	19,899		128		34,946		777		54,845		905
Corporate bonds	—		—		487		13		487		13
Mortgage backed securities	2,412		14		3,349		82		5,761		96
Total temporarily impaired	$	31,368	$	216	$	40,127	$	894	$	71,495	$	1,110

Management has the intent and ability to hold all securities in an unrealized loss position for the foreseeable future, and the decline in fair value is largely due to changes in interest rates and the change in the federal tax rate. The fair value is expected to recover as the securities approach their maturity date and/or market rates decline. There were 266 and 120 securities in an unrealized loss position as of June 30, 2018 and December 31, 2017, respectively.

NOTE 3 - LOANS AND ALLOWANCE FOR LOAN LOSSES

Loans at June 30, 2018 and December 31, 2017 were comprised as follows:

	June 30, 2018			December 31, 2017
Commercial, Industrial and Agricultural	$	186,306		$	138,706
Real Estate
1-4 Family Residential	218,849			111,932
1-4 Family HELOC	85,585			72,017
Multi-family and Commercial	401,548			261,044
Construction, Land Development and Farmland	214,462			156,452
Consumer	22,155			17,605
Other	13,546			14,694
	1,142,451			772,450
Less
Deferred loan (fees) costs	(8		)	231
Allowance for possible loan losses	10,169			9,731
Loans, net	$	1,132,290		$	762,488

13

RELIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

JUNE 30, 2018 (UNAUDITED) AND DECEMBER 31, 2017

(Dollar amounts in thousands except per share amounts)

NOTE 3 - LOANS AND ALLOWANCE FOR LOAN LOSSES (CONTINUED)

Activity in the allowance for loan losses by portfolio segment was as follows for the six months ended June 30, 2018:

	Commercial Industrial and Agricultural			Multi-family and Commercial Real Estate		Construction Land Development and Farmland			1-4 Family Residential Real Estate
Beginning balance	$	2,538		$	3,166	$	2,434		$	773
Charge-offs	(308		)	—		(140		)	(8		)
Recoveries	425			3		44			11
Provision	(970		)	692		177			469
Ending balance	$	1,685		$	3,861	$	2,515		$	1,245

	1-4 Family HELOC			Consumer			Other			Total
Beginning balance	$	595		$	183		$	42		$	9,731
Charge-offs	(6		)	(24		)	(22		)	(508		)
Recoveries	5			18			3			509
Provision	42			15			12			437
Ending balance	$	636		$	192		$	35		$	10,169

Activity in the allowance for loan losses by portfolio segment was as follows for the six months ended June 30, 2017:

	Commercial Industrial and Agricultural			Multi-family and Commercial Real Estate		Construction Land Development and Farmland		1-4 Family Residential Real Estate
Beginning balance	$	2,438		$	2,731	$	1,786	$	1,178
Charge-offs	(471		)	—		—		(15		)
Recoveries	140			—		3		—
Provision	850			172		131		(335		)
Ending balance	$	2,957		$	2,903	$	1,920	$	828

	1-4 Family HELOC			Consumer			Other		Total
Beginning balance	$	704		$	208		$	37	$	9,082
Charge-offs	—			(28		)	—		(514		)
Recoveries	18			1			—		162
Provision	(160		)	(4		)	1		655
Ending balance	$	562		$	177		$	38	$	9,385

14

RELIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

JUNE 30, 2018 (UNAUDITED) AND DECEMBER 31, 2017

(Dollar amounts in thousands except per share amounts)

NOTE 3 - LOANS AND ALLOWANCE FOR LOAN LOSSES (CONTINUED)

The allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method as of June 30, 2018 was as follows:

	Commercial Industrial and Agricultural		Multi-family and Commercial Real Estate		Construction Land Development and Farmland		1-4 Family Residential Real Estate
Allowance for loan losses
Individually evaluated for impairment	$	50	$	—	$	58	$	28
Acquired with credit impairment	—		100		—		—
Collectively evaluated for impairment	1,635		3,761		2,457		1,217
Total	$	1,685	$	3,861	$	2,515	$	1,245
Loans
Individually evaluated for impairment	$	1,200	$	2,009	$	2,237	$	2,216
Acquired with credit impairment	42		711		1,769		463
Collectively evaluated for impairment	185,064		398,828		210,456		216,170
Total	$	186,306	$	401,548	$	214,462	$	218,849

	1-4 Family HELOC		Consumer		Other		Total
Allowance for loan losses
Individually evaluated for impairment	$	—	$	—	$	—	$	136
Acquired with credit impairment	—		—		—		100
Collectively evaluated for impairment	636		192		35		9,933
Total	$	636	$	192	$	35	$	10,169
Loans
Individually evaluated for impairment	$	90	$	—	$	—	$	7,752
Acquired with credit impairment	—		11		—		2,996
Collectively evaluated for impairment	85,495		22,144		13,546		1,131,703
Total	$	85,585	$	22,155	$	13,546	$	1,142,451

15

RELIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

JUNE 30, 2018 (UNAUDITED) AND DECEMBER 31, 2017

(Dollar amounts in thousands except per share amounts)

NOTE 3 - LOANS AND ALLOWANCE FOR LOAN LOSSES (CONTINUED)

The allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method as of December 31, 2017 was as follows:

	Commercial Industrial and Agricultural		Multi-family and Commercial Real Estate		Construction Land Development and Farmland		1-4 Family Residential Real Estate
Allowance for loan losses
Individually evaluated for impairment	$	606	$	—	$	57	$	—
Acquired with credit impairment	2		—		2		—
Collectively evaluated for impairment	1,930		3,166		2,375		773
Total	$	2,538	$	3,166	$	2,434	$	773
Loans
Individually evaluated for impairment	$	3,649	$	1,921	$	3,800	$	2,114
Acquired with credit impairment	276		1,157		1,436		45
Collectively evaluated for impairment	134,781		257,966		151,216		109,773
Total	$	138,706	$	261,044	$	156,452	$	111,932

	1-4 Family HELOC		Consumer		Other		Total
Allowance for loan losses
Individually evaluated for impairment	$	—	$	—	$	—	$	663
Acquired with credit impairment	—		—		—		4
Collectively evaluated for impairment	595		183		42		9,064
Total	$	595	$	183	$	42	$	9,731
Loans
Individually evaluated for impairment	$	90	$	—	$	—	$	11,574
Acquired with credit impairment	—		—		—		2,914
Collectively evaluated for impairment	71,927		17,605		14,694		757,962
Total	$	72,017	$	17,605	$	14,694	$	772,450

Risk characteristics relevant to each portfolio segment are as follows:

Commercial,industrialand agricultural: The commercial, industrial and agricultural loan portfolio segment includes loans to commercial customers for use in normal business operations to finance working capital needs, equipment purchases or other expansion projects. Collection risk in this portfolio is driven by the creditworthiness of underlying borrowers, particularly cash flow from customers’ business operations. Commercial, industrial and agricultural loans are primarily made based on the identified cash flows of the borrower and secondarily on the underlying collateral provided by the borrower. The cash flows of borrowers, however, may not be as expected and the collateral securing these loans may fluctuate in value. Most commercial and industrial loans are secured by the assets being financed or other business assets such as accounts receivable or inventory and may incorporate a personal guarantee; however, some short-term loans may be made on an unsecured basis. In the case of loans secured by accounts receivable, the availability of funds for the repayment of these loans may be substantially dependent on the ability of the borrower to collect amounts due from its customers.

16

RELIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

JUNE 30, 2018 (UNAUDITED) AND DECEMBER 31, 2017

(Dollar amounts in thousands except per share amounts)

NOTE 3 - LOANS AND ALLOWANCE FOR LOAN LOSSES (CONTINUED)

Multi-family and commercial real estate: Multi-family and commercial real estate and multi-family loans are subject to underwriting standards and processes similar to commercial, industrial and agricultural loans, in addition to those of real estate loans. These loans are viewed primarily as cash flow loans and secondarily as loans secured by real estate.

Commercial real estate lending typically involves higher loan principal amounts and the repayment of these loans is generally largely dependent on the successful operation of the property securing the loan or the business conducted on the property securing the loan. Commercial real estate loans may be more adversely affected by conditions in the real estate markets or in the general economy. The properties securing the Company’s commercial real estate portfolio are diverse in terms of type. This diversity helps reduce the Company’s exposure to adverse economic events that affect any single market or industry. Management monitors and evaluates commercial real estate loans based on collateral, geography and risk grade criteria. The Company also utilizes third-party experts to provide insight and guidance about economic conditions and trends affecting the market areas it serves. In addition, management tracks the level of owner-occupied commercial real estate loans versus non-owner occupied loans. Non-owner occupied commercial real estate loans are loans secured by multifamily and commercial properties where the primary source of repayment is derived from rental income associated with the property (that is, loans for which 50 percent or more of the source of repayment comes from third party, nonaffiliated, rental income) or the proceeds of the sale, refinancing, or permanent financing of the property. These loans are made to finance income-producing properties such as apartment buildings, office and industrial buildings, and retail properties. Owner-occupied commercial real estate loans are loans where the primary source of repayment is the cash flow from the ongoing operations and business activities conducted by the party, or affiliate of the party, who owns the property.

Construction and land development: Loans for non-owner-occupied real estate construction or land development are generally repaid through cash flow related to the operation, sale or refinance of the property. The Company also finances construction loans for owner-occupied properties. A portion of the Company’s construction and land portfolio segment is comprised of loans secured by residential product types (residential land and single-family construction). With respect to construction loans to developers and builders that are secured by non-owner occupied properties that the Company may originate from time to time, the Company generally requires the borrower to have had an existing relationship with the Company and have a proven record of success. Construction and land development loans are underwritten utilizing feasibility studies, independent appraisal reviews, sensitivity analysis of absorption and lease rates, market sales activity, and financial analysis of the developers and property owners. Construction loans are generally based upon estimates of costs and value associated with the complete project. These estimates may be inaccurate. Construction loans often involve the disbursement of substantial funds with repayment substantially dependent on the success of the ultimate project. Sources of repayment for these types of loans may be pre-committed permanent loans from approved long-term lenders, sales of developed property or an interim loan commitment from the Company until permanent financing is obtained. These loans are closely monitored by on-site inspections and are considered to have higher risks than other real estate loans due to their ultimate repayment being sensitive to interest rate changes, governmental regulation of real property, general economic conditions and the availability of long-term financing.

1-4family residential real estate: Residential real estate loans represent loans to consumers or investors to finance a residence. These loans are typically financed on 15 to 30 year amortization terms, but generally with shorter maturities of 5 to 15 years. Many of these loans are extended to borrowers to finance their primary or secondary residence. Loans to an investor secured by a 1-4 family residence will be repaid from either the rental income from the property or from the sale of the property. This loan segment also includes closed-end home equity loans that are secured by a first or second mortgage on the borrower’s residence. This allows customers to borrow against the equity in their home. Loans in this portfolio segment are underwritten and approved based on a number of credit quality criteria including limits on maximum Loan-to-Value (LTV), minimum credit scores, and maximum debt to income. Real estate market values as of the time the loan is made directly affect the amount of credit extended and, in addition, changes in these residential property values impact the depth of potential losses in this portfolio segment.

17

RELIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

JUNE 30, 2018 (UNAUDITED) AND DECEMBER 31, 2017

(Dollar amounts in thousands except per share amounts)

NOTE 3 - LOANS AND ALLOWANCE FOR LOAN LOSSES (CONTINUED)

1-4 family HELOC: This loan segment includes open-end home equity loans that are secured by a first or second mortgage on the borrower’s residence. This allows customers to borrow against the equity in their home utilizing a revolving line of credit. These loans are underwritten and approved based on a number of credit quality criteria including limits on maximum LTV, minimum credit scores, and maximum debt to income. Real estate market values as of the time the loan is made directly affect the amount of credit extended and, in addition, changes in these residential property values impact the depth of potential losses in this portfolio segment. Because of the revolving nature of these loans as well as the fact that many represent second mortgages, this portfolio segment can contain more risk than the amortizing 1-4 family residential real estate loans.

Consumer: The consumer loan portfolio segment includes non-real estate secured direct loans to consumers for household, family, and other personal expenditures. Consumer loans may be secured or unsecured and are usually structured with short or medium term maturities. These loans are underwritten and approved based on a number of consumer credit quality criteria including limits on maximum LTV on secured consumer loans, minimum credit scores, and maximum debt to income. Many traditional forms of consumer installment credit have standard monthly payments and fixed repayment schedules of one to five years. These loans are made with either fixed or variable interest rates that are based on specific indices. Installment loans fill a variety of needs, such as financing the purchase of an automobile, a boat, a recreational vehicle, or other large personal items, or for consolidating debt. These loans may be unsecured or secured by an assignment of title, as in an automobile loan, or by money in a bank account. In addition to consumer installment loans, this portfolio segment also includes secured and unsecured personal lines of credit as well as overdraft protection lines. Loans in this portfolio segment are sensitive to unemployment and other key consumer economic measures.

Non-accrual loans by class of loan were as follows at June 30, 2018 and December 31, 2017:

	June 30, 2018		December 31, 2017
Commercial, Industrial and Agricultural	$	483	$	2,110
Multi-family and Commercial Real Estate	471		—
Construction, Land Development and Farmland	1,740		2,518
1-4 Family Residential Real Estate	1,575		533
1-4 Family HELOC	—		—
Consumer	91		—
Total	$	4,360	$	5,161

Performing non-accrual loans totaled $2,695 and $1,096 at June 30, 2018 and December 31, 2017, respectively.

18

RELIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

JUNE 30, 2018 (UNAUDITED) AND DECEMBER 31, 2017

(Dollar amounts in thousands except per share amounts)

NOTE 3 - LOANS AND ALLOWANCE FOR LOAN LOSSES (CONTINUED)

Individually impaired loans by class of loans were as follows at June 30, 2018:

	Unpaid Principal Balance		Recorded Investment with no Allowance Recorded		Recorded Investment with Allowance Recorded		Total Recorded Investment		Related Allowance
Commercial, Industrial and Agricultural	$	1,653	$	977	$	265	$	1,242	$	50
Multi-family and Commercial Real Estate	3,842		2,516		204		2,720		100
Construction, Land Development and Farmland	4,323		3,389		617		4,006		58
1-4 Family Residential Real Estate	3,758		2,651		28		2,679		28
1-4 Family HELOC	90		90		—		90		—
Consumer	17		11		—		11		—
Total	$	13,683	$	9,634	$	1,114	$	10,748	$	236

Individually impaired loans by class of loans were as follows at December 31, 2017:

	Unpaid Principal Balance		Recorded Investment with no Allowance Recorded		Recorded Investment with Allowance Recorded		Total Recorded Investment		Related Allowance
Commercial, Industrial and Agricultural	$	4,398	$	2,959	$	966	$	3,925	$	608
Multi-family and Commercial Real Estate	3,427		3,078		—		3,078		—
Construction, Land Development and Farmland	5,317		3,249		1,987		5,236		59
1-4 Family Residential Real Estate	2,857		2,159		—		2,159		—
1-4 Family HELOC	90		90		—		90		—
Total	$	16,089	$	11,535	$	2,953	$	14,488	$	667

The average balances of impaired loans for the six months ended June 30, 2018 and 2017 were as follows:

	2018		2017
Commercial, Industrial and Agricultural	$	3,040	$	5,758
Multi-family and Commercial Real Estate	3,010		4,832
Construction, Land Development and Farmland	5,083		4,192
1-4 Family Residential Real Estate	2,774		2,093
1-4 Family HELOC	90		1,180
Consumer	88		—
Total	$	14,085	$	18,055

19

RELIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

JUNE 3