x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
PEOPLES BANCORP INC. | ||||||||
(Exact name of Registrant as specified in its charter) | ||||||||
Ohio | 31-0987416 | |||||||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||
138 Putnam Street, P.O. Box 738, Marietta, Ohio | 45750 | |||||||
(Address of principal executive offices) | (Zip Code) | |||||||
Registrant’s telephone number, including area code: | (740) 373-3155 | |||||||
Not Applicable | ||||||||
(Former name, former address and former fiscal year, if changed since last report) | ||||||||
Securities registered pursuant to Section 12(b) of the Act: | ||||||||
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Common Shares, without par value | PEBO | The Nasdaq Stock Market |
Large accelerated filer o | Accelerated filer x | Non-accelerated filer o | Smaller reporting company o | Emerging growth company o |
Table of Contents | |
June 30, 2019 | December 31, 2018 | |||||
(Dollars in thousands) | (Unaudited) | |||||
Assets | ||||||
Cash and cash equivalents: | ||||||
Cash and due from banks | $ | 56,731 | $ | 61,775 | ||
Interest-bearing deposits in other banks | 36,692 | 15,837 | ||||
Total cash and cash equivalents | 93,423 | 77,612 | ||||
Available-for-sale investment securities, at fair value (amortized cost of $910,431 at June 30, 2019 and $804,655 at December 31, 2018) | 919,364 | 791,891 | ||||
Held-to-maturity investment securities, at amortized cost (fair value of $35,747 at June 30, 2019 and $36,963 at December 31, 2018) | 34,839 | 36,961 | ||||
Other investment securities | 43,508 | 42,985 | ||||
Total investment securities | 997,711 | 871,837 | ||||
Loans, net of deferred fees and costs (a) | 2,833,533 | 2,728,778 | ||||
Allowance for loan losses | (21,357 | ) | (20,195 | ) | ||
Net loans | 2,812,176 | 2,708,583 | ||||
Loans held for sale | 5,928 | 5,470 | ||||
Bank premises and equipment, net of accumulated depreciation | 64,451 | 56,542 | ||||
Bank owned life insurance | 69,909 | 68,934 | ||||
Goodwill | 163,292 | 151,245 | ||||
Other intangible assets | 13,471 | 10,840 | ||||
Other assets | 56,015 | 40,391 | ||||
Total assets | $ | 4,276,376 | $ | 3,991,454 | ||
Liabilities | ||||||
Deposits: | ||||||
Non-interest-bearing | $ | 643,058 | $ | 607,877 | ||
Interest-bearing | 2,720,555 | 2,347,588 | ||||
Total deposits | 3,363,613 | 2,955,465 | ||||
Short-term borrowings | 186,457 | 356,198 | ||||
Long-term borrowings | 85,691 | 109,644 | ||||
Accrued expenses and other liabilities | 61,593 | 50,007 | ||||
Total liabilities | 3,697,354 | 3,471,314 | ||||
Stockholders’ equity | ||||||
Preferred stock, no par value, 50,000 shares authorized, no shares issued at June 30, 2019 and December 31, 2018 | — | — | ||||
Common stock, no par value, 24,000,000 shares authorized, 21,142,256 shares issued at June 30, 2019 and 20,124,378 shares issued at December 31, 2018, including shares in treasury | 418,950 | 386,814 | ||||
Retained earnings | 171,410 | 160,346 | ||||
Accumulated other comprehensive income (loss), net of deferred income taxes | 316 | (12,933 | ) | |||
Treasury stock, at cost, 489,802 shares at June 30, 2019 and 601,289 shares at December 31, 2018 | (11,654 | ) | (14,087 | ) | ||
Total stockholders’ equity | 579,022 | 520,140 | ||||
Total liabilities and stockholders’ equity | $ | 4,276,376 | $ | 3,991,454 |
Three Months Ended | Six Months Ended | ||||||||||||
June 30, | June 30, | ||||||||||||
(Dollars in thousands, except per share data) | 2019 | 2018 | 2019 | 2018 | |||||||||
Interest income: | |||||||||||||
Interest and fees on loans | $ | 36,660 | $ | 31,250 | $ | 70,713 | $ | 58,131 | |||||
Interest and dividends on taxable investment securities | 5,969 | 5,830 | 11,779 | 11,480 | |||||||||
Interest on tax-exempt investment securities | 729 | 635 | 1,266 | 1,278 | |||||||||
Other interest income | 263 | 54 | 439 | 106 | |||||||||
Total interest income | 43,621 | 37,769 | 84,197 | 70,995 | |||||||||
Interest expense: | |||||||||||||
Interest on deposits | 5,719 | 3,101 | 10,563 | 5,314 | |||||||||
Interest on short-term borrowings | 1,233 | 1,175 | 2,406 | 2,143 | |||||||||
Interest on long-term borrowings | 620 | 685 | 1,265 | 1,371 | |||||||||
Total interest expense | 7,572 | 4,961 | 14,234 | 8,828 | |||||||||
Net interest income | 36,049 | 32,808 | 69,963 | 62,167 | |||||||||
Provision for loan losses | 626 | 1,188 | 363 | 3,171 | |||||||||
Net interest income after provision for loan losses | 35,423 | 31,620 | 69,600 | 58,996 | |||||||||
Non-interest income: | |||||||||||||
Insurance income | 3,486 | 3,369 | 8,107 | 8,024 | |||||||||
Trust and investment income | 3,401 | 3,232 | 6,513 | 6,300 | |||||||||
Electronic banking income | 3,267 | 2,785 | 6,254 | 5,570 | |||||||||
Deposit account service charges | 2,977 | 2,388 | 5,318 | 4,508 | |||||||||
Mortgage banking income | 1,000 | 969 | 1,788 | 1,320 | |||||||||
Bank owned life insurance income | 490 | 497 | 975 | 965 | |||||||||
Commercial loan swap fees | 516 | 146 | 662 | 262 | |||||||||
Net loss on investment securities | (57 | ) | (147 | ) | (27 | ) | (146 | ) | |||||
Net loss on asset disposals and other transactions | (293 | ) | (405 | ) | (475 | ) | (331 | ) | |||||
Other non-interest income | 502 | 421 | 1,603 | 1,752 | |||||||||
Total non-interest income | 15,289 | 13,255 | 30,718 | 28,224 | |||||||||
Non-interest expense: | |||||||||||||
Salaries and employee benefit costs | 20,824 | 18,025 | 40,026 | 34,015 | |||||||||
Net occupancy and equipment expense | 3,132 | 2,803 | 6,110 | 5,669 | |||||||||
Professional fees | 2,344 | 3,022 | 3,620 | 4,740 | |||||||||
Electronic banking expense | 1,693 | 1,407 | 3,270 | 2,857 | |||||||||
Data processing and software expense | 1,567 | 1,359 | 3,112 | 2,681 | |||||||||
Amortization of other intangible assets | 824 | 861 | 1,518 | 1,615 | |||||||||
Franchise tax expense | 772 | 614 | 1,477 | 1,258 | |||||||||
Marketing expense | 490 | 656 | 1,084 | 981 | |||||||||
FDIC insurance expense | 381 | 416 | 752 | 782 | |||||||||
Foreclosed real estate and other loan expenses | 469 | 338 | 724 | 550 | |||||||||
Communication expense | 317 | 300 | 595 | 644 | |||||||||
Other non-interest expense | 6,063 | 6,170 | 8,448 | 8,400 | |||||||||
Total non-interest expense | 38,876 | 35,971 | 70,736 | 64,192 | |||||||||
Income before income taxes | 11,836 | 8,904 | 29,582 | 23,028 | |||||||||
Income tax expense | 2,238 | 1,012 | 5,615 | 3,395 | |||||||||
Net income | $ | 9,598 | $ | 7,892 | $ | 23,967 | $ | 19,633 | |||||
Earnings per common share - basic | $ | 0.47 | $ | 0.41 | $ | 1.20 | $ | 1.05 | |||||
Earnings per common share - diluted | $ | 0.46 | $ | 0.41 | $ | 1.19 | $ | 1.04 | |||||
Weighted-average number of common shares outstanding - basic | 20,277,028 | 19,160,728 | 19,824,035 | 18,646,266 | |||||||||
Weighted-average number of common shares outstanding - diluted | 20,442,366 | 19,293,381 | 19,972,350 | 18,773,169 | |||||||||
Cash dividends declared | $ | 7,035 | $ | 5,466 | $ | 12,903 | $ | 10,237 | |||||
Cash dividends declared per common share | $ | 0.34 | $ | 0.28 | $ | 0.64 | $ | 0.54 |
Three Months Ended | Six Months Ended | ||||||||||||
June 30, | June 30, | ||||||||||||
(Dollars in thousands) | 2019 | 2018 | 2019 | 2018 | |||||||||
Net income | $ | 9,598 | $ | 7,892 | $ | 23,967 | $ | 19,633 | |||||
Other comprehensive income (loss): | |||||||||||||
Available-for-sale investment securities: | |||||||||||||
Gross unrealized holding gain (loss) arising during the period | 12,947 | (2,661 | ) | 21,672 | (12,774 | ) | |||||||
Related tax (expense) benefit | (2,719 | ) | 559 | (4,551 | ) | 3,737 | |||||||
Less: reclassification adjustment for net gain included in net income | (57 | ) | (147 | ) | (27 | ) | (146 | ) | |||||
Related tax benefit | 12 | 31 | 6 | 31 | |||||||||
Amounts reclassified out of accumulated other comprehensive loss per ASU 2016-01 (a) | — | — | — | (5,020 | ) | ||||||||
Net effect on other comprehensive income (loss) | 10,273 | (1,986 | ) | 17,142 | (13,942 | ) | |||||||
Defined benefit plans: | |||||||||||||
Net gain arising during the period | — | — | 2 | — | |||||||||
Amortization of unrecognized loss and service cost on benefit plans | 20 | 26 | 37 | 52 | |||||||||
Related tax expense | (4 | ) | (5 | ) | (8 | ) | (11 | ) | |||||
Net effect on other comprehensive income | 16 | 21 | 31 | 41 | |||||||||
Cash flow hedges: | |||||||||||||
Net (loss) gain arising during the period | (3,134 | ) | 537 | (4,967 | ) | 1,915 | |||||||
Related tax benefit (expense) | 658 | (113 | ) | 1,043 | (402 | ) | |||||||
Net effect on other comprehensive (loss) income | (2,476 | ) | 424 | (3,924 | ) | 1,513 | |||||||
Total other comprehensive income (loss), net of tax | 7,813 | (1,541 | ) | 13,249 | (12,388 | ) | |||||||
Total comprehensive income | $ | 17,411 | $ | 6,351 | $ | 37,216 | $ | 7,245 |
Accumulated Other Comprehensive Income (Loss) | Total Stockholders' Equity | ||||||||||||||
Common Stock | Retained Earnings | Treasury Stock | |||||||||||||
(Dollars in thousands) | |||||||||||||||
Balance, December 31, 2018 | $ | 386,814 | $ | 160,346 | $ | (12,933 | ) | $ | (14,087 | ) | $ | 520,140 | |||
Net income | — | 23,967 | — | — | 23,967 | ||||||||||
Other comprehensive income, net of tax | — | — | 13,249 | — | 13,249 | ||||||||||
Cash dividends declared | — | (12,903 | ) | — | — | (12,903 | ) | ||||||||
Reissuance of treasury stock for common share awards | (2,821 | ) | — | — | 2,821 | — | |||||||||
Reissuance of treasury stock for deferred compensation plan for Boards of Directors | — | — | — | 53 | 53 | ||||||||||
Repurchase of treasury stock in connection with employee incentive plan and under compensation plan for Boards of Directors | — | — | — | (684 | ) | (684 | ) | ||||||||
Common shares issued under dividend reinvestment plan | 384 | — | — | — | 384 | ||||||||||
Common shares issued under compensation plan for Boards of Directors | 52 | — | — | 157 | 209 | ||||||||||
Common shares issued under employee stock purchase plan | 28 | — | — | 86 | 114 | ||||||||||
Stock-based compensation | 2,056 | — | — | — | 2,056 | ||||||||||
Issuance of common shares related to merger with First Prestonsburg Bancshares Inc. | 32,437 | — | — | — | 32,437 | ||||||||||
Balance, June 30, 2019 | $ | 418,950 | $ | 171,410 | $ | 316 | $ | (11,654 | ) | $ | 579,022 |
Six Months Ended | ||||||
June 30, | ||||||
(Dollars in thousands) | 2019 | 2018 | ||||
Net cash provided by operating activities | $ | 18,821 | $ | 27,499 | ||
Investing activities: | ||||||
Available-for-sale investment securities: | ||||||
Purchases | (116,433 | ) | (81,441 | ) | ||
Proceeds from sales | 72,481 | 14,489 | ||||
Proceeds from principal payments, calls and prepayments | 70,728 | 60,088 | ||||
Held-to-maturity investment securities: | ||||||
Proceeds from principal payments | 1,984 | 2,627 | ||||
Other investment securities: | ||||||
Purchases | (376 | ) | (1,089 | ) | ||
Proceeds from sales | 3,872 | 7,111 | ||||
Proceeds from insurance claim | 26 | — | ||||
Net decrease (increase) in loans held for investment | 29,219 | (92,582 | ) | |||
Net expenditures for premises and equipment | (1,233 | ) | (2,721 | ) | ||
Proceeds from sales of other real estate owned | 143 | 265 | ||||
Business acquisitions, net of cash received | 7,795 | 4,695 | ||||
Investment in limited partnership and tax credit funds | (44 | ) | (399 | ) | ||
Net cash provided by (used in) investing activities | 68,162 | (88,957 | ) | |||
Financing activities: | ||||||
Net (decrease) increase in non-interest-bearing deposits | (23,318 | ) | 364 | |||
Net increase in interest-bearing deposits | 173,571 | 19,705 | ||||
Net (decrease) increase in short-term borrowings | (207,329 | ) | 66,412 | |||
Payments on long-term borrowings | (849 | ) | (1,062 | ) | ||
Cash dividends paid | (12,467 | ) | (10,001 | ) | ||
Repurchase of treasury stock in connection with employee incentive program and compensation plan for Boards of Directors to be held as treasury stock | (684 | ) | (1,143 | ) | ||
Proceeds from issuance of common shares | 6 | 15 | ||||
Contingent consideration payments made after a business combination | (102 | ) | (224 | ) | ||
Net cash (used in) provided by financing activities | (71,172 | ) | 74,066 | |||
Net increase in cash and cash equivalents | 15,811 | 12,608 | ||||
Cash and cash equivalents at beginning of period | 77,612 | 72,194 | ||||
Cash and cash equivalents at end of period | $ | 93,423 | $ | 84,802 | ||
Supplemental cash flow information: | ||||||
Interest paid | 13,765 | 8,765 | ||||
Income taxes paid | 6,150 | 6,065 | ||||
Supplemental noncash disclosures: | ||||||
Transfers from loans to other real estate owned | 49 | 16 |
Recurring Fair Value Measurements at Reporting Date | |||||||||||||||||||
June 30, 2019 | December 31, 2018 | ||||||||||||||||||
(Dollars in thousands) | Level 1 | Level 2 | Level 3 | Level 1 | Level 2 | Level 3 | |||||||||||||
Assets: | |||||||||||||||||||
Available-for-sale investment securities: | |||||||||||||||||||
Obligations of: | |||||||||||||||||||
U.S. government sponsored agencies | $ | — | $ | 19,051 | $ | — | $ | — | $ | — | $ | — | |||||||
States and political subdivisions | — | 125,418 | — | — | 88,587 | — | |||||||||||||
Residential mortgage-backed securities | — | 748,132 | — | — | 692,608 | — | |||||||||||||
Commercial mortgage-backed securities | — | 22,664 | — | — | 6,707 | — | |||||||||||||
Bank-issued trust preferred securities | — | 4,099 | — | — | 3,989 | — | |||||||||||||
Total available-for-sale securities | — | 919,364 | — | — | 791,891 | — | |||||||||||||
Equity investment securities | 111 | 188 | — | 94 | 183 | — | |||||||||||||
Derivative assets (a) | — | 9,972 | — | — | 4,544 | — | |||||||||||||
Liabilities: | |||||||||||||||||||
Derivative liabilities (b) | $ | — | $ | 14,020 | $ | — | $ | — | $ | 3,562 | $ | — |
Non-Recurring Fair Value Measurements at Reporting Date | |||||||||||||||||||
June 30, 2019 | December 31, 2018 | ||||||||||||||||||
(Dollars in thousands) | Level 1 | Level 2 | Level 3 | Level 1 | Level 2 | Level 3 | |||||||||||||
Impaired loans | $ | — | $ | — | $ | 32,952 | $ | — | $ | — | $ | 24,129 | |||||||
Other real estate owned ("OREO") | — | — | 123 | — | — | 94 |
Fair Value Measurements of Other Financial Instruments | ||||||||||||||
(Dollars in thousands) | Fair Value Hierarchy Level | June 30, 2019 | December 31, 2018 | |||||||||||
Carrying Amount | Fair Value | Carrying Amount | Fair Value | |||||||||||
Assets: | ||||||||||||||
Cash and cash equivalents | 1 | $ | 93,423 | $ | 93,423 | $ | 77,612 | $ | 77,612 | |||||
Held-to-maturity investment securities: | ||||||||||||||
Obligations of: | ||||||||||||||
States and political subdivisions | 2 | 4,398 | 4,880 | 4,403 | 4,896 | |||||||||
Residential mortgage-backed securities | 2 | 23,335 | 23,451 | 29,044 | 28,603 | |||||||||
Commercial mortgage-backed securities | 2 | 7,106 | 7,416 | 3,514 | 3,464 | |||||||||
Total held-to-maturity securities | 34,839 | 35,747 | 36,961 | 36,963 | ||||||||||
Other investment securities: | ||||||||||||||
Federal Home Loan Bank ("FHLB") stock | 2 | 29,257 | 29,257 | 29,367 | 29,367 | |||||||||
Federal Reserve Bank ("FRB") stock | 2 | 12,294 | 12,294 | 12,294 | 12,294 | |||||||||
Nonqualified deferred compensation | 2 | 1,293 | 1,293 | 987 | 987 | |||||||||
Other investment securities | 2 | 365 | 365 | 60 | 60 | |||||||||
Other investment securities (a) | 43,209 | 43,209 | 42,708 | 42,708 | ||||||||||
Net loans | 3 | 2,812,176 | 3,076,717 | 2,708,583 | 2,907,537 | |||||||||
Loans held for sale | 2 | 5,928 | 6,353 | 5,470 | 5,492 | |||||||||
Bank owned life insurance | 3 | 69,909 | 69,909 | 68,934 | 68,934 | |||||||||
Servicing rights (b) | 3 | 2,571 | 3,617 | 2,655 | 4,568 | |||||||||
Liabilities: | ||||||||||||||
Deposits | 2 | $ | 3,363,613 | $ | 3,335,686 | $ | 2,955,465 | $ | 2,953,452 | |||||
Short-term borrowings | 2 | 186,457 | 187,337 | 356,198 | 349,994 | |||||||||
Long-term borrowings | 2 | 85,691 | 84,933 | 109,644 | 107,696 |
(Dollars in thousands) | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||
June 30, 2019 | ||||||||||||
Obligations of: | ||||||||||||
U.S. government sponsored agencies | $ | 18,606 | $ | 445 | $ | — | $ | 19,051 | ||||
States and political subdivisions | 122,809 | 2,721 | (112 | ) | 125,418 | |||||||
Residential mortgage-backed securities | 742,164 | 8,770 | (2,802 | ) | 748,132 | |||||||
Commercial mortgage-backed securities | 22,656 | 148 | (140 | ) | 22,664 | |||||||
Bank-issued trust preferred securities | 4,196 | 100 | (197 | ) | 4,099 | |||||||
Total available-for-sale securities | $ | 910,431 | $ | 12,184 | $ | (3,251 | ) | $ | 919,364 | |||
December 31, 2018 | ||||||||||||
Obligations of: | ||||||||||||
States and political subdivisions | $ | 88,358 | $ | 787 | $ | (558 | ) | $ | 88,587 | |||
Residential mortgage-backed securities | 705,289 | 2,720 | (15,401 | ) | 692,608 | |||||||
Commercial mortgage-backed securities | 6,812 | — | (105 | ) | 6,707 | |||||||
Bank-issued trust preferred securities | 4,196 | 75 | (282 | ) | 3,989 | |||||||
Total available-for-sale securities | $ | 804,655 | $ | 3,582 | $ | (16,346 | ) | $ | 791,891 |
Three Months Ended | Six Months Ended | ||||||||||||
June 30, | June 30, | ||||||||||||
(Dollars in thousands) | 2019 | 2018 | 2019 | 2018 | |||||||||
Gross gains realized | $ | 30 | $ | 3 | $ | 60 | $ | 5 | |||||
Gross losses realized | 87 | 150 | 87 | 151 | |||||||||
Net losses realized | $ | (57 | ) | $ | (147 | ) | $ | (27 | ) | $ | (146 | ) |
Less than 12 Months | 12 Months or More | Total | ||||||||||||||||||||||
(Dollars in thousands) | Fair Value | Unrealized Loss | No. of Securities | Fair Value | Unrealized Loss | No. of Securities | Fair Value | Unrealized Loss | ||||||||||||||||
June 30, 2019 | ||||||||||||||||||||||||
Obligations of: | ||||||||||||||||||||||||
States and political subdivisions | $ | — | $ | — | — | $ | 8,020 | $ | 112 | 5 | $ | 8,020 | $ | 112 | ||||||||||
Residential mortgage-backed securities | 17,932 | 154 | 7 | 226,208 | 2,648 | 77 | 244,140 | 2,802 | ||||||||||||||||
Commercial mortgage-backed securities | — | — | — | 6,380 | 140 | 5 | 6,380 | 140 | ||||||||||||||||
Bank-issued trust preferred securities | — | — | — | 1,803 | 197 | 2 | 1,803 | 197 | ||||||||||||||||
Total | $ | 17,932 | $ | 154 | 7 | $ | 242,411 | $ | 3,097 | 89 | $ | 260,343 | $ | 3,251 | ||||||||||
December 31, 2018 | ||||||||||||||||||||||||
Obligations of: | ||||||||||||||||||||||||
States and political subdivisions | $ | 10,173 | $ | 18 | 17 | $ | 19,918 | $ | 540 | 20 | $ | 30,091 | $ | 558 | ||||||||||
Residential mortgage-backed securities | 47,562 | 226 | 50 | 517,335 | 15,175 | 170 | 564,897 | 15,401 | ||||||||||||||||
Commercial mortgage-backed securities | — | — | — | 6,707 | 105 | 3 | 6,707 | 105 | ||||||||||||||||
Bank-issued trust preferred securities | — | — | — | 1,718 | 282 | 2 | 1,718 | 282 | ||||||||||||||||
Total | $ | 57,735 | $ | 244 | 67 | $ | 545,678 | $ | 16,102 | 195 | $ | 603,413 | $ | 16,346 |
(Dollars in thousands) | Within 1 Year | 1 to 5 Years | 5 to 10 Years | Over 10 Years | Total | ||||||||||
Amortized cost | |||||||||||||||
Obligations of: | |||||||||||||||
U.S. government sponsored agencies | $ | — | $ | 2,984 | $ | 14,644 | $ | 978 | $ | 18,606 | |||||
States and political subdivisions | 4,234 | 31,186 | 44,207 | 43,182 | 122,809 | ||||||||||
Residential mortgage-backed securities | 1 | 1,919 | 60,647 | 679,597 | 742,164 | ||||||||||
Commercial mortgage-backed securities | — | 17,107 | 1,848 | 3,701 | 22,656 | ||||||||||
Bank-issued trust preferred securities | — | — | 4,196 | — | 4,196 | ||||||||||
Total available-for-sale securities | $ | 4,235 | $ | 53,196 | $ | 125,542 | $ | 727,458 | $ | 910,431 | |||||
Fair value | |||||||||||||||
Obligations of: | |||||||||||||||
U.S. government sponsored agencies | $ | — | $ | 3,041 | $ | 15,011 | $ | 999 | $ | 19,051 | |||||
States and political subdivisions | 4,236 | 31,477 | 45,518 | 44,187 | 125,418 | ||||||||||
Residential mortgage-backed securities | 1 | 1,934 | 60,507 | 685,690 | 748,132 | ||||||||||
Commercial mortgage-backed securities | — | 17,195 | 1,904 | 3,565 | 22,664 | ||||||||||
Bank-issued trust preferred securities | — | — | 4,099 | — | 4,099 | ||||||||||
Total available-for-sale securities | $ | 4,237 | $ | 53,647 | $ | 127,039 | $ | 734,441 | $ | 919,364 | |||||
Total weighted-average yield | 2.36 | % | 2.52 | % | 2.77 | % | 2.93 | % | 2.88 | % |
(Dollars in thousands) | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||
June 30, 2019 | ||||||||||||
Obligations of: | ||||||||||||
States and political subdivisions | $ | 4,398 | $ | 482 | $ | — | $ | 4,880 | ||||
Residential mortgage-backed securities | 23,335 | 256 | (140 | ) | 23,451 | |||||||
Commercial mortgage-backed securities | 7,106 | 310 | — | 7,416 | ||||||||
Total held-to-maturity securities | $ | 34,839 | $ | 1,048 | $ | (140 | ) | $ | 35,747 | |||
December 31, 2018 | ||||||||||||
Obligations of: | ||||||||||||
States and political subdivisions | $ | 4,403 | $ | 493 | $ | — | $ | 4,896 | ||||
Residential mortgage-backed securities | 29,044 | 191 | (632 | ) | 28,603 | |||||||
Commercial mortgage-backed securities | 3,514 | — | (50 | ) | 3,464 | |||||||
Total held-to-maturity securities | $ | 36,961 | $ | 684 | $ | (682 | ) | $ | 36,963 |
Less than 12 Months | 12 Months or More | Total | ||||||||||||||||||||||
(Dollars in thousands) | Fair Value | Unrealized Loss | No. of Securities | Fair Value | Unrealized Loss | No. of Securities | Fair Value | Unrealized Loss | ||||||||||||||||
June 30, 2019 | ||||||||||||||||||||||||
Residential mortgage-backed securities | $ | — | $ | — | — | $ | 11,639 | $ | 140 | 3 | $ | 11,639 | $ | 140 | ||||||||||
Total | $ | — | $ | — | — | $ | 11,639 | $ | 140 | 3 | $ | 11,639 | $ | 140 | ||||||||||
December 31, 2018 | ||||||||||||||||||||||||
Residential mortgage-backed securities | $ | — | $ | — | — | $ | 13,102 | $ | 632 | 5 | $ | 13,102 | $ | 632 | ||||||||||
Commercial mortgage-backed securities | — | — | — | 3,464 | 50 | 1 | 3,464 | 50 | ||||||||||||||||
Total | $ | — | $ | — | — | $ | 16,566 | $ | 682 | 6 | $ | 16,566 | $ | 682 |
(Dollars in thousands) | Within 1 Year | 1 to 5 Years | 5 to 10 Years | Over 10 Years | Total | ||||||||||
Amortized cost | |||||||||||||||
Obligations of: | |||||||||||||||
States and political subdivisions | $ | 305 | $ | — | $ | 2,984 | $ | 1,109 | $ | 4,398 | |||||
Residential mortgage-backed securities | — | — | 4,002 | 19,333 | 23,335 | ||||||||||
Commercial mortgage-backed securities | — | 410 | 3,893 | 2,803 | 7,106 | ||||||||||
Total held-to-maturity securities | $ | 305 | $ | 410 | $ | 10,879 | $ | 23,245 | $ | 34,839 | |||||
Fair value | |||||||||||||||
Obligations of: | |||||||||||||||
States and political subdivisions | $ | 307 | $ | — | $ | 3,458 | $ | 1,115 | $ | 4,880 | |||||
Residential mortgage-backed securities | — | — | 4,070 | 19,381 | 23,451 | ||||||||||
Commercial mortgage-backed securities | — | 412 | 4,196 | 2,808 | 7,416 | ||||||||||
Total held-to-maturity securities | $ | 307 | $ | 412 | $ | 11,724 | $ | 23,304 | $ | 35,747 | |||||
Total weighted-average yield | 2.62 | % | 2.29 | % | 1.49 | % | 2.81 | % | 2.83 | % |
(Dollars in thousands) | June 30, 2019 | December 31, 2018 | ||||
FHLB stock | $ | 29,257 | $ | 29,367 | ||
FRB stock | 12,294 | 12,294 | ||||
Nonqualified deferred compensation | 1,293 | 987 | ||||
Equity investment securities | 299 | 277 | ||||
Other investment securities | 365 | 60 | ||||
Total other investment securities | $ | 43,508 | $ | 42,985 |
(Dollars in thousands) | June 30, 2019 | December 31, 2018 | ||||
Originated loans: | ||||||
Commercial real estate, construction | $ | 102,904 | $ | 124,013 | ||
Commercial real estate, other | 641,061 | 632,200 | ||||
Commercial real estate | 743,965 | 756,213 | ||||
Commercial and industrial | 548,460 | 530,207 | ||||
Residential real estate | 299,173 | 296,860 | ||||
Home equity lines of credit | 90,374 | 93,326 | ||||
Consumer, indirect | 419,595 | 407,167 | ||||
Consumer, direct | 72,209 | 71,674 | ||||
Consumer | 491,804 | 478,841 | ||||
Deposit account overdrafts | 676 | 583 | ||||
Total originated loans | $ | 2,174,452 | $ | 2,156,030 | ||
Acquired loans: | ||||||
Commercial real estate, construction | $ | 6,775 | $ | 12,404 | ||
Commercial real estate, other | 201,909 | 184,711 | ||||
Commercial real estate | 208,684 | 197,115 | ||||
Commercial and industrial | 51,506 | 35,537 | ||||
Residential real estate | 348,439 | 296,937 | ||||
Home equity lines of credit | 41,262 | 40,653 | ||||
Consumer, indirect | 90 | 136 | ||||
Consumer, direct | 9,100 | 2,370 | ||||
Consumer | 9,190 | 2,506 | ||||
Total acquired loans | $ | 659,081 | $ | 572,748 | ||
Total loans | $ | 2,833,533 | $ | 2,728,778 |
(Dollars in thousands) | June 30, 2019 | December 31, 2018 | ||||
Commercial real estate | $ | 13,116 | $ | 11,955 | ||
Commercial and industrial | 4,479 | 1,287 | ||||
Residential real estate | 23,509 | 20,062 | ||||
Consumer | 640 | 58 | ||||
Total outstanding balance | $ | 41,744 | $ | 33,362 | ||
Net carrying amount | $ | 28,125 | $ | 22,475 |
(Dollars in thousands) | June 30, 2019 | June 30, 2018 | ||||
Balance, beginning of period | $ | 8,955 | $ | 6,704 | ||
Additions: | ||||||
ASB Financial Corp. | — | 2,415 | ||||
First Prestonsburg Bancshares Inc. | 3,853 | — | ||||
Accretion | (1,148 | ) | (897 | ) | ||
Balance, June 30 | $ | 11,660 | $ | 8,222 |
Nonaccrual Loans | Loans 90+ Days Past Due and Accruing | ||||||||||||
(Dollars in thousands) | June 30, 2019 | December 31, 2018 | June 30, 2019 | December 31, 2018 | |||||||||
Originated loans: | |||||||||||||
Commercial real estate, construction | $ | 688 | $ | 710 | $ | — | $ | — | |||||
Commercial real estate, other | 6,241 | 6,565 | — | 786 | |||||||||
Commercial real estate | 6,929 | 7,275 | — | 786 | |||||||||
Commercial and industrial | 2,044 | 1,673 | — | — | |||||||||
Residential real estate | 3,816 | 4,105 | 438 | 398 | |||||||||
Home equity lines of credit | 452 | 596 | 53 | 7 | |||||||||
Consumer, indirect | 535 | 480 | — | — | |||||||||
Consumer, direct | 12 | 56 | — | — | |||||||||
Consumer | 547 | 536 | — | — | |||||||||
Total originated loans | $ | 13,788 | $ | 14,185 | $ | 491 | $ | 1,191 | |||||
Acquired loans: | |||||||||||||
Commercial real estate, construction | $ | — | $ | — | $ | 230 | $ | — | |||||
Commercial real estate, other | 308 | 319 | 557 | 15 | |||||||||
Commercial real estate | 308 | 319 | 787 | 15 | |||||||||
Commercial and industrial | 36 | 36 | 261 | 18 | |||||||||
Residential real estate | 1,716 | 1,921 | 1,853 | 1,032 | |||||||||
Home equity lines of credit | 742 | 637 | — | — | |||||||||
Consumer, direct | 1 | — | 57 | — | |||||||||
Total acquired loans | $ | 2,803 | $ | 2,913 | $ | 2,958 | $ | 1,065 | |||||
Total loans | $ | 16,591 | $ | 17,098 | $ | 3,449 | $ | 2,256 |
Loans Past Due | Current Loans | Total Loans | |||||||||||||||||
(Dollars in thousands) | 30 - 59 days | 60 - 89 days | 90 + Days | Total | |||||||||||||||
June 30, 2019 | |||||||||||||||||||
Originated loans: | |||||||||||||||||||
Commercial real estate, construction | $ | — | $ | — | $ | 688 | $ | 688 | $ | 102,216 | $ | 102,904 | |||||||
Commercial real estate, other | — | — | 6,050 | 6,050 | 635,011 | 641,061 | |||||||||||||
Commercial real estate | — | — | 6,738 | 6,738 | 737,227 | 743,965 | |||||||||||||
Commercial and industrial | 606 | 3 | 1,937 | 2,546 | 545,914 | 548,460 | |||||||||||||
Residential real estate | 1,391 | 1,177 | 2,478 | 5,046 | 294,127 | 299,173 | |||||||||||||
Home equity lines of credit | 387 | 18 | 461 | 866 | 89,508 | 90,374 | |||||||||||||
Consumer, indirect | 3,024 | 216 | 111 | 3,351 | 416,244 | 419,595 | |||||||||||||
Consumer, direct | 306 | 17 | 2 | 325 | 71,884 | 72,209 | |||||||||||||
Consumer | 3,330 | 233 | 113 | 3,676 | 488,128 | 491,804 | |||||||||||||
Deposit account overdrafts | — | — | — | — | 676 | 676 | |||||||||||||
Total originated loans | $ | 5,714 | $ | 1,431 | $ | 11,727 | $ | 18,872 | $ | 2,155,580 | $ | 2,174,452 | |||||||
Acquired loans: | |||||||||||||||||||
Commercial real estate, construction | $ | — | $ | — | $ | 230 | $ | 230 | $ | 6,545 | $ | 6,775 | |||||||
Commercial real estate, other | 661 | 728 | 773 | 2,162 | 199,747 | 201,909 | |||||||||||||
Commercial real estate | 661 | 728 | 1,003 | 2,392 | 206,292 | 208,684 | |||||||||||||
Commercial and industrial | 488 | 60 | 297 | 845 | 50,661 | 51,506 | |||||||||||||
Residential real estate | 1,685 | 2,075 | 2,700 | 6,460 | 341,979 | 348,439 | |||||||||||||
Home equity lines of credit | 228 | 109 | 563 | 900 | 40,362 | 41,262 | |||||||||||||
Consumer, indirect | — | — | — | — | 90 | 90 | |||||||||||||
Consumer, direct | 88 | 52 | 57 | 197 | 8,903 | 9,100 | |||||||||||||
Consumer | 88 | 52 | 57 | 197 | 8,993 | 9,190 | |||||||||||||
Total acquired loans | $ | 3,150 | $ | 3,024 | $ | 4,620 | $ | 10,794 | $ | 648,287 | $ | 659,081 | |||||||
Total loans | $ | 8,864 | $ | 4,455 | $ | 16,347 | $ | 29,666 | $ | 2,803,867 | $ | 2,833,533 |
Loans Past Due | Current Loans | Total Loans | |||||||||||||||||
(Dollars in thousands) | 30 - 59 days | 60 - 89 days | 90 + Days | Total | |||||||||||||||
December 31, 2018 | |||||||||||||||||||
Originated loans: | |||||||||||||||||||
Commercial real estate, construction | $ | — | $ | — | $ | 710 | $ | 710 | $ | 123,303 | $ | 124,013 | |||||||
Commercial real estate, other | 12 | 736 | 7,151 | 7,899 | 624,301 | 632,200 | |||||||||||||
Commercial real estate | 12 | 736 | 7,861 | 8,609 | 747,604 | 756,213 | |||||||||||||
Commercial and industrial | 1,678 | 3,520 | 1,297 | 6,495 | 523,712 | 530,207 | |||||||||||||
Residential real estate | 4,457 | 1,319 | 2,595 | 8,371 | 288,489 | 296,860 | |||||||||||||
Home equity lines of credit | 531 | 30 | 431 | 992 | 92,334 | 93,326 | |||||||||||||
Consumer, indirect | 3,266 | 488 | 165 | 3,919 | 403,248 | 407,167 | |||||||||||||
Consumer, direct | 308 | 50 | 42 | 400 | 71,274 | 71,674 | |||||||||||||
Consumer | 3,574 | 538 | 207 | 4,319 | 474,522 | 478,841 | |||||||||||||
Deposit account overdrafts | — | — | — | — | 583 | 583 | |||||||||||||
Total originated loans | $ | 10,252 | $ | 6,143 | $ | 12,391 | $ | 28,786 | $ | 2,127,244 | $ | 2,156,030 | |||||||
Acquired loans: | |||||||||||||||||||
Commercial real estate, construction | $ | 511 | $ | — | $ | — | $ | 511 | $ | 11,893 | $ | 12,404 | |||||||
Commercial real estate, other | 523 | 457 | 233 | 1,213 | 183,498 | 184,711 | |||||||||||||
Commercial real estate | 1,034 | 457 | 233 | 1,724 | 195,391 | 197,115 | |||||||||||||
Commercial and industrial | 111 | 13 | 18 | 142 | 35,395 | 35,537 | |||||||||||||
Residential real estate | 6,124 | 1,823 | 1,885 | 9,832 | 287,105 | 296,937 | |||||||||||||
Home equity lines of credit | 238 | 233 | 534 | 1,005 | 39,648 | 40,653 | |||||||||||||
Consumer, indirect | — | — | — | — | 136 | 136 | |||||||||||||
Consumer, direct | 23 | 6 | — | 29 | 2,341 | 2,370 | |||||||||||||
Consumer | 23 | 6 | — | 29 | 2,477 | 2,506 | |||||||||||||
Total acquired loans | $ | 7,530 | $ | 2,532 | $ | 2,670 | $ | 12,732 | $ | 560,016 | $ | 572,748 | |||||||
Total loans | $ | 17,782 | $ | 8,675 | $ | 15,061 | $ | 41,518 | $ | 2,687,260 | $ | 2,728,778 |
Pass Rated (Grades 1 - 4) | Special Mention (Grade 5) | Substandard (Grade 6) | Doubtful (Grade 7) | Not Rated | Total Loans | |||||||||||||
(Dollars in thousands) | ||||||||||||||||||
June 30, 2019 | ||||||||||||||||||
Originated loans: | ||||||||||||||||||
Commercial real estate, construction | $ | 100,231 | $ | — | $ | 1,431 | $ | — | $ | 1,242 | $ | 102,904 | ||||||
Commercial real estate, other | 622,966 | 7,673 | 10,416 | 6 | — | 641,061 | ||||||||||||
Commercial real estate | 723,197 | 7,673 | 11,847 | 6 | 1,242 | 743,965 | ||||||||||||
Commercial and industrial | 525,738 | 5,807 | 16,915 | — | — | 548,460 | ||||||||||||
Residential real estate | 13,752 | 201 | 14,682 | 249 | 270,289 | 299,173 | ||||||||||||
Home equity lines of credit | 17 | — | — | — | 90,357 | 90,374 | ||||||||||||
Consumer, indirect | — | — | — | — | 419,595 | 419,595 | ||||||||||||
Consumer, direct | 24 | — | — | — | 72,185 | 72,209 | ||||||||||||
Consumer | 24 | — | — | — | 491,780 | 491,804 | ||||||||||||
Deposit account overdrafts | — | — | — | — | 676 | 676 | ||||||||||||
Total originated loans | $ | 1,262,728 | $ | 13,681 | $ | 43,444 | $ | 255 | $ | 854,344 | $ | 2,174,452 | ||||||
Acquired loans: | ||||||||||||||||||
Commercial real estate, construction | $ | 4,338 | $ | 1,636 | $ | 801 | $ | — | $ | — | $ | 6,775 | ||||||
Commercial real estate, other | 178,425 | 12,700 | 10,693 | 91 | — | 201,909 | ||||||||||||
Commercial real estate | 182,763 | 14,336 | 11,494 | 91 | — | 208,684 | ||||||||||||
Commercial and industrial | 43,171 | 3,265 | 5,038 | 32 | — | 51,506 | ||||||||||||
Residential real estate | 17,634 | 2,686 | 2,564 | 130 | 325,425 | 348,439 | ||||||||||||
Home equity lines of credit | 81 | — | — | — | 41,181 | 41,262 | ||||||||||||
Consumer, indirect | 1 | — | — | — | 89 | 90 | ||||||||||||
Consumer, direct | 19 | — | — | — | 9,081 | 9,100 | ||||||||||||
Consumer | 20 | — | — | — | 9,170 | 9,190 | ||||||||||||
Total acquired loans | $ | 243,669 | $ | 20,287 | $ | 19,096 | $ | 253 | $ | 375,776 | $ | 659,081 | ||||||
Total loans | $ | 1,506,397 | $ | 33,968 | $ | 62,540 | $ | 508 | $ | 1,230,120 | $ | 2,833,533 |
Pass Rated (Grades 1 - 4) | Special Mention (Grade 5) | Substandard (Grade 6) | Doubtful (Grade 7) | Not Rated | Total Loans | |||||||||||||
(Dollars in thousands) | ||||||||||||||||||
December 31, 2018 | ||||||||||||||||||
Originated loans: | ||||||||||||||||||
Commercial real estate, construction | $ | 121,457 | $ | — | $ | 1,472 | $ | — | $ | 1,084 | $ | 124,013 | ||||||
Commercial real estate, other | 612,099 | 10,898 | 9,203 | — | — | 632,200 | ||||||||||||
Commercial real estate | 733,556 | 10,898 | 10,675 | — | 1,084 | 756,213 | ||||||||||||
Commercial and industrial | 476,290 | 45,990 | 7,692 | — | 235 | 530,207 | ||||||||||||
Residential real estate | 14,229 | 500 | 11,971 | 409 | 269,751 | 296,860 | ||||||||||||
Home equity lines of credit | 453 | — | — | — | 92,873 | 93,326 | ||||||||||||
Consumer, indirect | 8 | — | — | — | 407,159 | 407,167 | ||||||||||||
Consumer, direct | 30 | — | — | — | 71,644 | 71,674 | ||||||||||||
Consumer | 38 | — | — | — | 478,803 | 478,841 | ||||||||||||
Deposit account overdrafts | — | — | — | — | 583 | 583 | ||||||||||||
Total originated loans | $ | 1,224,566 | $ | 57,388 | $ | 30,338 | $ | 409 | $ | 843,329 | $ | 2,156,030 | ||||||
Acquired loans: | ||||||||||||||||||
Commercial real estate, construction | $ | 8,976 | $ | 1,795 | $ | 1,633 | $ | — | $ | — | $ | 12,404 | ||||||
Commercial real estate, other | 169,260 | 7,241 | 8,114 | 96 | — | 184,711 | ||||||||||||
Commercial real estate | 178,236 | 9,036 | 9,747 | 96 | — | 197,115 | ||||||||||||
Commercial and industrial | 32,471 | 2,008 | 1,058 | — | — | 35,537 | ||||||||||||
Residential real estate | 17,370 | 1,938 | 2,033 | 137 | 275,459 | 296,937 | ||||||||||||
Home equity lines of credit | 33 | — | — | — | 40,620 | 40,653 | ||||||||||||
Consumer, indirect | 4 | — | — | — | 132 | 136 | ||||||||||||
Consumer, direct | 31 | — | — | — | 2,339 | 2,370 | ||||||||||||
Consumer | 35 | — | — | — | 2,471 | 2,506 | ||||||||||||
Total acquired loans | $ | 228,145 | $ | 12,982 | $ | 12,838 | $ | 233 | $ | 318,550 | $ | 572,748 | ||||||
Total loans | $ | 1,452,711 | $ | 70,370 | $ | 43,176 | $ | 642 | $ | 1,161,879 | $ | 2,728,778 |
Unpaid Principal Balance | Recorded Investment | Total Recorded Investment | Average Recorded Investment | Interest Income Recognized | |||||||||||||||||
With Allowance | Without Allowance | Related Allowance | |||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||
June 30, 2019 | |||||||||||||||||||||
Commercial real estate, construction | $ | 1,793 | $ | — | $ | 1,706 | $ | 1,706 | $ | — | $ | 1,728 | $ | 29 | |||||||
Commercial real estate, other | 15,546 | 4,753 | 10,296 | 15,049 | 520 | 14,722 | 250 | ||||||||||||||
Commercial real estate | 17,339 | 4,753 | 12,002 | 16,755 | 520 | 16,450 | 279 | ||||||||||||||
Commercial and industrial | 4,265 | 1,485 | 2,731 | 4,216 | 449 | 3,226 | 47 | ||||||||||||||
Residential real estate | 22,195 | 387 | 23,170 | 23,557 | 53 | 22,086 | 629 | ||||||||||||||
Home equity lines of credit | 1,469 | 419 | 1,051 | 1,470 | 68 | 1,343 | 40 | ||||||||||||||
Consumer, indirect | 445 | 96 | 356 | 452 | 23 | 413 | 15 | ||||||||||||||
Consumer, direct | 464 | 49 | 415 | 464 | 18 | 207 | 9 | ||||||||||||||
Consumer | 909 | 145 | 771 | 916 | 41 | 620 | 24 | ||||||||||||||
Total | $ | 46,177 | $ | 7,189 | $ | 39,725 | $ | 46,914 | $ | 1,131 | $ | 43,725 | $ | 1,019 | |||||||
December 31, 2018 | |||||||||||||||||||||
Commercial real estate, construction | $ | 2,376 | $ | — | $ | 2,376 | $ | 2,376 | $ | — | $ | 1,732 | $ | 74 | |||||||
Commercial real estate, other | 15,464 | 274 | 14,946 | 15,220 | 119 | 14,043 | 455 | ||||||||||||||
Commercial real estate | 17,840 | 274 | 17,322 | 17,596 | 119 | 15,775 | 529 | ||||||||||||||
Commercial and industrial | 3,305 | 790 | 2,436 | 3,226 | 157 | 2,423 | 72 | ||||||||||||||
Residential real estate | 25,990 | 644 | 24,034 | 24,678 | 154 | 22,769 | 1,134 | ||||||||||||||
Home equity lines of credit | 2,291 | 424 | 1,869 | 2,293 | 73 | 1,832 | 109 | ||||||||||||||
Consumer, indirect | 496 | — | 503 | 503 | — | 278 | 15 | ||||||||||||||
Consumer, direct | 79 | 22 | 57 | 79 | 6 | 63 | 20 | ||||||||||||||
Consumer | 575 | 22 | 560 | 582 | 6 | 341 | 35 | ||||||||||||||
Total | $ | 50,001 | $ | 2,154 | $ | 46,221 | $ | 48,375 | $ | 509 | $ | 43,140 | $ | 1,879 |
Three Months Ended | |||||||||||
Recorded Investment (a) | |||||||||||
(Dollars in thousands) | Number of Contracts | Pre-Modification | Post-Modification | Remaining Recorded Investment | |||||||
June 30, 2019 | |||||||||||
Originated loans: | |||||||||||
Residential real estate | 1 | $ | 37 | $ | 37 | $ | 37 | ||||
Home equity lines of credit | 2 | 60 | 60 | 60 | |||||||
Consumer, indirect | 7 | 110 | 110 | 110 | |||||||
Consumer, direct | 3 | 41 | 41 | 41 | |||||||
Consumer | 10 | 151 | 151 | 151 | |||||||
Total originated loans | 13 | $ | 248 | $ | 248 | $ | 248 | ||||
Acquired loans: | |||||||||||
Commercial real estate, other | 7 | $ | 725 | $ | 699 | $ | 700 | ||||
Commercial and industrial | 4 | 1,259 | 1,259 | 1,259 | |||||||
Residential real estate | 35 | 1,823 | 1,823 | 1,823 | |||||||
Home equity lines of credit | 7 | 113 | 113 | 113 | |||||||
Consumer, direct | 16 | 340 | 340 | 340 | |||||||
Total acquired loans | 69 | $ | 4,260 | $ | 4,234 | $ | 4,235 | ||||
June 30, 2018 | |||||||||||
Originated loans: | |||||||||||
Residential real estate | 5 | $ | 717 | $ | 717 | $ | 717 | ||||
Home equity lines of credit | 3 | 61 | 61 | 61 | |||||||
Consumer, indirect | 14 | 230 | 230 | 230 | |||||||
Consumer, direct | 5 | 27 | 27 | 27 | |||||||
Consumer | 19 | 257 | 257 | 257 | |||||||
Total originated loans | 27 | $ | 1,035 | $ | 1,035 | $ | 1,035 | ||||
Acquired loans: | |||||||||||
Residential real estate | 11 | $ | 720 | $ | 720 | $ | 720 | ||||
Home equity lines of credit | 4 | 86 | 86 | 86 | |||||||
Consumer, direct | 3 | 57 | 57 | 57 | |||||||
Total acquired loans | 18 | $ | 863 | $ | 863 | $ | 863 | ||||
(a) The amounts shown are inclusive of all partial paydowns and charge-offs. Loans modified in a TDR that were fully paid down, charged-off or foreclosed upon by period-end are not reported. |
Six Months Ended | |||||||||||
Recorded Investment (a) | |||||||||||
(Dollars in thousands) | Number of Contracts | Pre-Modification | Post-Modification | Remaining Recorded Investment | |||||||
June 30, 2019 | |||||||||||
Originated loans: | |||||||||||
Commercial and industrial | 2 | $ | 38 | $ | 38 | $ | 35 | ||||
Residential real estate | 3 | 436 | 440 | 437 | |||||||
Home equity lines of credit | 4 | 139 | 139 | 139 | |||||||
Consumer, indirect | 8 | 123 | 123 | 123 | |||||||
Consumer, direct | 5 | 69 | 69 | 67 | |||||||
Consumer | 13 | 192 | 192 | 190 | |||||||
Total originated loans | 22 | $ | 805 | $ | 809 | $ | 801 | ||||
Acquired loans: | |||||||||||
Commercial real estate, other | 7 | $ | 724 | $ | 699 | $ | 700 | ||||
Commercial and industrial | 4 | 1,259 | 1,259 | 1,259 | |||||||
Residential real estate | 36 | 1,847 | 1,847 | 1,842 | |||||||
Home equity lines of credit | 9 | 179 | 179 | 178 | |||||||
Consumer, direct | 16 | 340 | 340 | 340 | |||||||
Total acquired loans | 72 | $ | 4,349 | $ | 4,324 | $ | 4,319 | ||||
June 30, 2018 | |||||||||||
Originated loans: | |||||||||||
Residential real estate | 7 | $ | 910 | $ | 910 | $ | 911 | ||||
Home equity lines of credit | 3 | 61 | 61 | 61 | |||||||
Consumer, indirect | 21 | 316 | 316 | 302 | |||||||
Consumer, direct | 7 | 31 | 31 | 31 | |||||||
Consumer | 28 | 347 | 347 | 333 | |||||||
Total originated loans | 38 | $ | 1,318 | $ | 1,318 | $ | 1,305 | ||||
Acquired loans: | |||||||||||
Commercial real estate, other | 1 | $ | 50 | $ | 50 | $ | 48 | ||||
Residential real estate | 13 | 989 | 989 | 989 | |||||||
Home equity lines of credit | 4 | 86 | 86 | 86 | |||||||
Consumer, direct | 3 | 57 | 57 | 57 | |||||||
Total acquired loans | 21 | $ | 1,182 | $ | 1,182 | $ | 1,180 | ||||
(a) The amounts shown are inclusive of all partial paydowns and charge-offs. Loans modified in a TDR that were fully paid down, charged-off or foreclosed upon by period end are not reported. |
June 30, 2019 | June 30, 2018 | ||||||||||||||||
(Dollars in thousands) | Number of Contracts | Recorded Investment (a) | Impact on the Allowance for Loan Losses | Number of Contracts | Recorded Investment (a) | Impact on the Allowance for Loan Losses | |||||||||||
Acquired loans: | |||||||||||||||||
Consumer, direct | 1 | $ | 34 | $ | — | — | $ | — | $ | — | |||||||
Total | 1 | $ | 34 | $ | — | — | $ | — | $ | — | |||||||
(a) The amount shown is inclusive of all partial paydowns and charge-offs. Loans modified in a TDR that were fully paid down, charged-off or foreclosed upon by period end are not reported. |
(Dollars in thousands) | Commercial Real Estate | Commercial and Industrial | Residential Real Estate | Home Equity Lines of Credit | Consumer Indirect | Consumer Direct | Deposit Account Overdrafts | Total | ||||||||||||||||
Balance, January 1, 2019 | $ | 8,003 | $ | 6,178 | $ | 1,214 | $ | 618 | $ | 3,214 | $ | 351 | $ | 81 | $ | 19,659 | ||||||||
Charge-offs | (153 | ) | (63 | ) | (176 | ) | (9 | ) | (819 | ) | (96 | ) | (349 | ) | (1,665 | ) | ||||||||
Recoveries | 12 | 2,012 | 133 | 2 | 162 | 40 | 106 | 2,467 | ||||||||||||||||
Net (charge-offs) recoveries | (141 | ) | 1,949 | (43 | ) | (7 | ) | (657 | ) | (56 | ) | (243 | ) | 802 | ||||||||||
Provision for (recoveries of) loan losses | 383 | (930 | ) | 13 | (13 | ) | 615 | 47 | 248 | 363 | ||||||||||||||
Balance, June 30, 2019 | $ | 8,245 | $ | 7,197 | $ | 1,184 | $ | 598 | $ | 3,172 | $ | 342 | $ | 86 | $ | 20,824 | ||||||||
Balance, January 1, 2018 | $ | 7,797 | $ | 5,813 | $ | 904 | $ | 693 | $ | 2,944 | $ | 464 | $ | 70 | $ | 18,685 | ||||||||
Charge-offs | (849 | ) | (38 | ) | (227 | ) | (57 | ) | (1,479 | ) | (219 | ) | (420 | ) | (3,289 | ) | ||||||||
Recoveries | 43 | — | 67 | 9 | 272 | 84 | 116 | 591 | ||||||||||||||||
Net charge-offs | (806 | ) | (38 | ) | (160 | ) | (48 | ) | (1,207 | ) | (135 | ) | (304 | ) | (2,698 | ) | ||||||||
Provision for (recovery of) loan losses | 1,280 | (410 | ) | 261 | (27 | ) | 1,602 | 136 | 329 | 3,171 | ||||||||||||||
Balance, June 30, 2018 | $ | 8,271 | $ | 5,365 | $ | 1,005 | $ | 618 | $ | 3,339 | $ | 465 | $ | 95 | $ | 19,158 |
(Dollars in thousands) | Commercial Real Estate | Commercial and Industrial | Residential Real Estate | Home Equity Lines of Credit | Consumer Indirect | Consumer Direct | Deposit Account Overdrafts | Total | ||||||||||||||||
June 30, 2019 | ||||||||||||||||||||||||
Allowance for loan losses allocated to: | ||||||||||||||||||||||||
Loans individually evaluated for impairment | $ | 520 | $ | 449 | $ | 53 | $ | 68 | $ | 23 | $ | 18 | $ | — | $ | 1,131 | ||||||||
Loans collectively evaluated for impairment | 7,725 | 6,748 | 1,131 | 530 | 3,149 | 324 | 86 | 19,693 | ||||||||||||||||
Ending balance | $ | 8,245 | $ | 7,197 | $ | 1,184 | $ | 598 | $ | 3,172 | $ | 342 | $ | 86 | $ | 20,824 | ||||||||
Recorded investment in: | ||||||||||||||||||||||||
Loans individually evaluated for impairment | $ | 16,755 | $ | 4,216 | $ | 23,557 | $ | 1,470 | $ | 452 | $ | 464 | $ | — | $ | 46,914 | ||||||||
Loans collectively evaluated for impairment | 727,210 | 544,244 | 275,616 | 88,904 | 419,143 | 71,745 | 676 | 2,127,538 | ||||||||||||||||
Ending balance | $ | 743,965 | $ | 548,460 | $ | 299,173 | $ | 90,374 | $ | 419,595 | $ | 72,209 | $ | 676 | $ | 2,174,452 | ||||||||
December 31, 2018 | ||||||||||||||||||||||||
Allowance for loan losses allocated to: | ||||||||||||||||||||||||
Loans individually evaluated for impairment | $ | 119 | $ | 157 | $ | 154 | $ | 73 | $ | — | $ | 6 | $ | — | $ | 509 | ||||||||
Loans collectively evaluated for impairment | 7,884 | 6,021 | 1,060 | 545 | 3,214 | 345 | 81 | 19,150 | ||||||||||||||||
Ending balance | $ | 8,003 | $ | 6,178 | $ | 1,214 | $ | 618 | $ | 3,214 | $ | 351 | $ | 81 | $ | 19,659 | ||||||||
Recorded investment in: | ||||||||||||||||||||||||
Loans individually evaluated for impairment | $ | 17,596 | $ | 3,226 | $ | 24,678 | $ | 2,293 | $ | 503 | $ | 79 | $ | — | $ | 48,375 | ||||||||
Loans collectively evaluated for impairment | 738,617 | 526,981 | 272,182 | 91,033 | 406,664 | 71,595 | 583 | 2,107,655 | ||||||||||||||||
Ending balance | $ | 756,213 | $ | 530,207 | $ | 296,860 | $ | 93,326 | $ | 407,167 | $ | 71,674 | $ | 583 | $ | 2,156,030 | ||||||||
June 30, 2018 | ||||||||||||||||||||||||
Allowance for loan losses allocated to: | ||||||||||||||||||||||||
Loans individually evaluated for impairment | $ | 1 | $ | 191 | $ | 47 | $ | 14 | $ | 31 | $ | 45 | $ | — | $ | 329 | ||||||||
Loans collectively evaluated for impairment | 8,270 | 5,174 | 958 | 604 | 3,308 | 420 | 95 | 18,829 | ||||||||||||||||
Ending balance | $ | 8,271 | $ | 5,365 | $ | 1,005 | $ | 618 | $ | 3,339 | $ | 465 | $ | 95 | $ | 19,158 | ||||||||
Recorded investment in: | ||||||||||||||||||||||||
Loans individually evaluated for impairment | $ | 19,162 | $ | 3,173 | $ | 26,497 | $ | 1,736 | $ | 441 | $ | 150 | $ | — | $ | 51,159 | ||||||||
Loans collectively evaluated for impairment | 737,051 | 468,097 | 273,437 | 88,221 | 372,943 | 71,395 | 860 | 2,012,004 | ||||||||||||||||
Ending balance | $ | 756,213 | $ | 471,270 | $ | 299,934 | $ | 89,957 | $ | 373,384 | $ | 71,545 | $ | 860 | $ | 2,063,163 |
Three Months Ended | Six Months Ended | ||||||||||||
(Dollars in thousands) | June 30, 2019 | June 30, 2018 | June 30, 2019 | June 30, 2018 | |||||||||
Non-impaired loans: | |||||||||||||
Balance, beginning of period | $ | 380 | $ | — | $ | 383 | $ | — | |||||
Charge-offs | — | — | (3 | ) | — | ||||||||
Balance, end of period | $ | 380 | $ | — | $ | 380 | $ | — | |||||
Purchased credit impaired loans: | |||||||||||||
Balance, beginning of period | $ | 153 | $ | 108 | $ | 153 | $ | 108 | |||||
Balance, end of period | $ | 153 | $ | 108 | $ | 153 | $ | 108 |
June 30, 2019 | December 31, 2018 | ||||||||||
(Dollars in thousands) | Balance | Weighted- Average Rate | Balance | Weighted- Average Rate | |||||||
FHLB putable, non-amortizing, fixed-rate advances | $ | 65,000 | 2.18 | % | $ | 85,000 | 2.05 | % | |||
FHLB amortizing, fixed-rate advances | 13,324 | 1.73 | % | 17,361 | 2.09 | % | |||||
Junior subordinated debt securities | 7,367 | 7.34 | % | 7,283 | 7.83 | % | |||||
Total long-term borrowings | $ | 85,691 | 2.55 | % | $ | 109,644 | 2.44 | % |
(Dollars in thousands) | Balance | Weighted-Average Rate | |||
Six months ending December 31, 2019 | $ | 2,568 | 1.48 | % | |
Year ending December 31, 2020 | 2,555 | 1.35 | % | ||
Year ending December 31, 2021 | 21,979 | 1.74 | % | ||
Year ending December 31, 2022 | 16,521 | 1.95 | % | ||
Year ending December 31, 2023 | 1,157 | 1.06 | % | ||
Thereafter | 40,911 | 3.41 | % | ||
Total long-term borrowings | $ | 85,691 | 2.55 | % |
Common Stock | Treasury Stock | |||
Shares at December 31, 2018 | 20,124,378 | 601,289 | ||
Changes related to stock-based compensation awards: | ||||
Release of restricted common shares | — | 17,481 | ||
Cancellation of restricted common shares | — | 3,465 | ||
Grant of restricted common shares | — | (122,286 | ) | |
Grant of common shares | — | (4,680 | ) | |
Changes related to deferred compensation plan for Boards of Directors: | ||||
Purchase of treasury stock | — | 3,834 | ||
Disbursed out of treasury stock | — | (2,187 | ) | |
Common shares issued under dividend reinvestment plan | 12,400 | — | ||
Common shares issued under compensation plan for Boards of Directors | — | (3,490 | ) | |
Common shares issued under employee stock purchase plan | — | (3,624 | ) | |
Issuance of common shares related to the merger with First Prestonsburg Bancshares Inc. | 1,005,478 | — | ||
Shares at June 30, 2019 | 21,142,256 | 489,802 |
2019 | 2018 | |||||
First quarter | $ | 0.30 | $ | 0.26 | ||
Second quarter | 0.34 | 0.28 | ||||
Third quarter | 0.34 | 0.28 | ||||
Total dividends declared | $ | 0.98 | $ | 0.82 |
(Dollars in thousands) | Unrealized Gain (Loss) on Securities | Unrecognized Net Pension and Postretirement Costs | Unrealized Gain (Loss) on Cash Flow Hedge | Accumulated Other Comprehensive Income (Loss) | ||||||||
Balance, December 31, 2018 | $ | (10,082 | ) | $ | (3,711 | ) | $ | 860 | $ | (12,933 | ) | |
Reclassification adjustments to net income: | ||||||||||||
Realized gain on sale of securities, net of tax | 21 | — | — | 21 | ||||||||
Other comprehensive income (loss), net of reclassifications and tax | 17,121 | 31 | (3,924 | ) | 13,228 | |||||||
Balance, June 30, 2019 | $ | 7,060 | $ | (3,680 | ) | $ | (3,064 | ) | $ | 316 |
Pension Benefits | |||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||
June 30, | June 30, | ||||||||||||
(Dollars in thousands) | 2019 | 2018 | 2019 | 2018 | |||||||||
Interest cost | $ | 110 | $ | 105 | $ | 219 | $ | 210 | |||||
Expected return on plan assets | (196 | ) | (146 | ) | (391 | ) | (293 | ) | |||||
Amortization of net loss | 20 | 27 | 39 | 55 | |||||||||
Net periodic income | $ | (66 | ) | $ | (14 | ) | $ | (133 | ) | $ | (28 | ) |
Postretirement Benefits | |||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||
June 30, | June 30, | ||||||||||||
(Dollars in thousands) | 2019 | 2018 | 2019 | 2018 | |||||||||
Interest cost | $ | 1 | $ | 1 | $ | 2 | $ | 2 | |||||
Amortization of prior service cost | (1 | ) | — | (1 | ) | — | |||||||
Amortization of net loss | — | (1 | ) | (2 | ) | (3 | ) | ||||||
Net periodic income | $ | — | $ | — | $ | (1 | ) | $ | (1 | ) |
Three Months Ended | Six Months Ended | ||||||||||||
June 30, | June 30, | ||||||||||||
(Dollars in thousands, except per common share data) | 2019 | 2018 | 2019 | 2018 | |||||||||
Distributed earnings allocated to common shareholders | $ | 6,935 | $ | 5,407 | $ | 12,711 | $ | 10,123 | |||||
Undistributed earnings allocated to common shareholders | 2,568 | 2,427 | 11,067 | 9,389 | |||||||||
Net earnings allocated to common shareholders | $ | 9,503 | $ | 7,834 | $ | 23,778 | $ | 19,512 | |||||
Weighted-average common shares outstanding | 20,277,028 | 19,160,728 | 19,824,035 | 18,646,266 | |||||||||
Effect of potentially dilutive common shares | 165,338 | 132,653 | 148,315 | 126,903 | |||||||||
Total weighted-average diluted common shares outstanding | 20,442,366 | 19,293,381 | 19,972,350 | 18,773,169 | |||||||||
Earnings per common share: | |||||||||||||
Basic | $ | 0.47 | $ | 0.41 | $ | 1.20 | $ | 1.05 | |||||
Diluted | $ | 0.46 | $ | 0.41 | $ | 1.19 | $ | 1.04 | |||||
Anti-dilutive common shares excluded from calculation: | |||||||||||||
Restricted shares | 87 | — | 46 | 32 |
(Dollars in thousands) | June 30, 2019 | December 31, 2018 | ||||
Notional amount | $ | 140,000 | $ | 110,000 | ||
Weighted average pay rates | 2.27 | % | 2.37 | % | ||
Weighted average receive rates | 1.80 | % | 2.57 | % | ||
Weighted average maturity | 5.6 years | 6.2 years | ||||
Unrealized gains | $ | 3,879 | $ | 860 |
Three Months Ended | Six Months Ended | ||||||||||||
June 30, | June 30, | ||||||||||||
(Dollars in thousands) | 2019 | 2018 | 2019 | 2018 | |||||||||
Amount of loss (gain) recognized in AOCI, pre-tax | $ | 2,994 | $ | (529 | ) | $ | 4,661 | $ | (1,907 | ) | |||
Amount of (gain) loss recognized in earnings | $ | — | $ | — | $ | (19 | ) | $ | 30 |
June 30, 2019 | December 31, 2018 | |||||||||||
(Dollars in thousands) | Notional Amount | Fair Value | Notional Amount | Fair Value | ||||||||
Included in other assets: | ||||||||||||
Interest rate swaps related to debt | $ | 35,000 | $ | 316 | $ | 60,000 | $ | 2,093 | ||||
Total included in other assets | $ | 35,000 | $ | 316 | $ | 60,000 | $ | 2,093 | ||||
Included in accrued expenses and other liabilities: | ||||||||||||
Interest rate swaps related to debt | $ | 105,000 | $ | 4,363 | $ | 50,000 | $ | 1,111 | ||||
Total included in accrued expenses and other liabilities | $ | 105,000 | $ | 4,363 | $ | 50,000 | $ | 1,111 |
June 30, 2019 | December 31, 2018 | |||||||||||
(Dollars in thousands) | Notional Amount | Fair Value | Notional Amount | Fair Value | ||||||||
Included in other assets: | ||||||||||||
Interest rate swaps related to commercial loans | $ | 245,996 | $ | 9,656 | $ | 226,662 | $ | 2,451 | ||||
Total included in other assets | $ | 245,996 | $ | 9,656 | $ | 226,662 | $ | 2,451 | ||||
Included in accrued expenses and other liabilities: | ||||||||||||
Interest rate swaps related to commercial loans | $ | 245,996 | $ | 9,656 | $ | 226,662 | $ | 2,451 | ||||
Total included in accrued expenses and other liabilities | $ | 245,996 | $ | 9,656 | $ | 226,662 | $ | 2,451 |
Time-Based Vesting | Performance-Based Vesting | ||||||||||
Number of Common Shares | Weighted-Average Grant Date Fair Value | Number of Common Shares | Weighted-Average Grant Date Fair Value | ||||||||
Outstanding at January 1 | 43,679 | $ | 29.64 | 175,772 | $ | 31.08 | |||||
Awarded | 5,086 | 32.05 | 117,200 | 32.20 | |||||||
Released | 17,500 | 21.69 | 33,400 | 17.86 | |||||||
Forfeited | 2,852 | 37.79 | 613 | 34.50 | |||||||
Outstanding at June 30 | 28,413 | $ | 34.16 | 258,959 | $ | 33.29 |
Three Months Ended | Six Months Ended | ||||||||||||
June 30, | June 30, | ||||||||||||
(Dollars in thousands) | 2019 | 2018 | 2019 | 2018 | |||||||||
Total stock-based compensation expense | $ | 930 | $ | 424 | $ | 2,138 | $ | 1,510 | |||||
Recognized tax benefit | (195 | ) | (89 | ) | (449 | ) | (317 | ) | |||||
Net expense recognized | $ | 735 | $ | 335 | $ | 1,689 | $ | 1,193 |
Three Months Ended | Six Months Ended | ||||||||||||
(Dollars in thousands) | June 30, 2019 | June 30, 2018 | June 30, 2019 | June 30, 2018 | |||||||||
Insurance income: | |||||||||||||
Commission and fees from sale of insurance policies (a) | $ | 3,306 | $ | 3,193 | $ | 6,339 | $ | 6,382 | |||||
Fees related to third-party administration services (a) | 178 | 173 | 347 | 292 | |||||||||
Performance-based commissions (b) | 2 | 3 | 1,421 | 1,350 | |||||||||
Trust and investment income (a) | 3,401 | 3,232 | 6,513 | 6,300 | |||||||||
Electronic banking income: | |||||||||||||
Interchange income (a) | 2,747 | 2,520 | 5,190 | 4,784 | |||||||||
Promotional and usage income (a) | 520 | 265 | 1,064 | 786 | |||||||||
Deposit account service charges: | |||||||||||||
Ongoing maintenance fees for deposit accounts (a) | 1,012 | 646 | 1,764 | 1,321 | |||||||||
Transactional-based fees (b) | 1,965 | 1,742 | 3,554 | 3,187 | |||||||||
Commercial loan swap fees (b) | 516 | 146 | 662 | 262 | |||||||||
Other non-interest income transactional-based fees (b) | 253 | 262 | 424 | 543 | |||||||||
Total | $ | 13,900 | $ | 12,182 | $ | 27,278 | $ | 25,207 | |||||
Timing of revenue recognition: | |||||||||||||
Services transferred over time | $ | 11,164 | $ | 10,029 | $ | 21,217 | $ | 19,865 | |||||
Services transferred at a point in time | 2,736 | 2,153 | 6,061 | 5,342 | |||||||||
Total | $ | 13,900 | $ | 12,182 | $ | 27,278 | $ | 25,207 |
Contract Assets | Contract Liabilities | |||||
(Dollars in thousands) | ||||||
Balance, January 1, 2019 | $ | 207 | $ | 5,055 | ||
Additional income receivable | 183 | — | ||||
Additional deferred income | — | 4,013 | ||||
Receipt of income previously receivable | (11 | ) | — | |||
Recognition of income previously deferred | — | (3,521 | ) | |||
Balance, June 30, 2019 | $ | 379 | $ | 5,547 |
(Dollars in thousands, except per share data) | |||
Consideration | |||
Common shares | 80,362 | ||
Number of common shares of Peoples issued for each common share of acquired company | 12.512 | ||
Price per Peoples common share, based on closing date | $ | 32.26 | |
Common share consideration | $ | 32,437 | |
Net Assets at Fair Value | |||
Assets | |||
Cash and due from banks | $ | 4,998 | |
Interest-bearing deposits in other banks | 2,798 | ||
Total cash and cash equivalents | 7,796 | ||
Available-for-sale investment securities | 137,658 | ||
Other investment securities | 3,068 | ||
Total investment securities | 140,726 | ||
Total loans | 130,407 | ||
Bank premises and equipment, net of accumulated depreciation | 8,255 | ||
Other intangible assets | 4,234 | ||
Other assets | 2,677 | ||
Total assets | $ | 294,095 | |
Liabilities | |||
Deposits: | |||
Non-interest-bearing | $ | 40,089 | |
Interest-bearing | 217,151 | ||
Total deposits | 257,240 | ||
Short-term borrowings | 14,400 | ||
Accrued expenses and other liabilities | 2,065 | ||
Total liabilities | $ | 273,705 | |
Net assets | $ | 20,390 | |
Goodwill | $ | 12,047 |
(Dollars in thousands) | First Prestonsburg | ||
Non-impaired Loans | |||
Contractual cash flows | $ | 168,903 | |
Nonaccretable difference | 19,756 | ||
Expected cash flows | 149,147 | ||
Accretable yield | 27,789 | ||
Fair value | $ | 121,358 | |
Credit Impaired Loans | |||
Contractual cash flows | $ | 17,706 | |
Nonaccretable difference | 4,804 | ||
Expected cash flows | 12,902 | ||
Accretable yield | 3,853 | ||
Fair value | $ | 9,049 |
Three Months Ended | Six Months Ended | ||||||
(Dollars in thousands) | June 30, 2019 | June 30, 2019 | |||||
Operating lease expense | $ | 311 | 618 | ||||
Short-term lease expense | 32 | 62 | |||||
Total lease expense | $ | 343 | $ | 680 |
(Dollars in thousands) | June 30, 2019 | ||
Right-of-use asset: | |||
Other assets | $ | 6,661 | |
Lease liability: | |||
Accrued expenses and other liabilities | $ | 6,839 | |
Other information: | |||
Weighted-average remaining lease term | 13.1 years | ||
Weighted-average discount rate | 2.46 | % |
(Dollars in thousands) | Balance | ||
Six months ending December 31, 2019 | $ | 10 | |
Year ending December 31, 2020 | 112 | ||
Year ending December 31, 2021 | 148 | ||
Year ending December 31, 2022 | 700 | ||
Year ending December 31, 2023 | 63 | ||
Thereafter | 5,806 | ||
Total lease liability | $ | 6,839 |
At or For the Three Months Ended | At or For the Six Months Ended | ||||||||||||
June 30, | June 30, | ||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||
Operating Data (a) | |||||||||||||
Total interest income | $ | 43,621 | $ | 37,769 | $ | 84,197 | $ | 70,995 | |||||
Total interest expense | 7,572 | 4,961 | 14,234 | 8,828 | |||||||||
Net interest income | 36,049 | 32,808 | 69,963 | 62,167 | |||||||||
Provision for loan losses | 626 | 1,188 | 363 | 3,171 | |||||||||
Net loss on investment securities | (57 | ) | (147 | ) | (27 | ) | (146 | ) | |||||
Net loss on asset disposals and other transactions | (293 | ) | (405 | ) | (475 | ) | (331 | ) | |||||
Total non-interest income excluding net gains and losses | 15,639 | 13,807 | 31,220 | 28,701 | |||||||||
Total non-interest expense | 38,876 | 35,971 | 70,736 | 64,192 | |||||||||
Net income | 9,598 | 7,892 | 23,967 | 19,633 | |||||||||
Balance Sheet Data (a) | |||||||||||||
Total investment securities | $ | 997,711 | $ | 876,765 | $ | 997,711 | $ | 876,765 | |||||
Loans, net of deferred fees and costs ("total loans") | 2,833,533 | 2,686,491 | 2,833,533 | 2,686,491 | |||||||||
Allowance for loan losses | 21,357 | 19,266 | 21,357 | 19,266 | |||||||||
Goodwill and other intangible assets | 176,763 | 163,953 | 176,763 | 163,953 | |||||||||
Total assets | 4,276,376 | 3,972,091 | 4,276,376 | 3,972,091 | |||||||||
Non-interest-bearing deposits | 643,058 | 585,861 | 643,058 | 585,861 | |||||||||
Other interest-bearing deposits | 2,394,398 | 2,363,398 | 2,394,398 | 2,363,398 | |||||||||
Brokered certificates of deposits | 326,157 | 211,062 | 326,157 | 211,062 | |||||||||
Short-term borrowings | 186,457 | 360,727 | 186,457 | 360,727 | |||||||||
Junior subordinated debentures held by subsidiary trust | 7,367 | 7,195 | 7,367 | 7,195 | |||||||||
Other long-term borrowings | 85,691 | 113,085 | 85,691 | 113,085 | |||||||||
Total stockholders' equity | 579,022 | 499,339 | 579,022 | 499,339 | |||||||||
Tangible assets (b) | 4,099,613 | 3,808,138 | 4,099,613 | 3,808,138 | |||||||||
Tangible equity (b) | 402,259 | 335,386 | 402,259 | 335,386 | |||||||||
Per Common Share Data (a) | |||||||||||||
Earnings per common share – basic | $ | 0.47 | $ | 0.41 | $ | 1.20 | $ | 1.05 | |||||
Earnings per common share – diluted | 0.46 | 0.41 | 1.19 | 1.04 | |||||||||
Cash dividends declared per common share | 0.34 | 0.28 | 0.64 | 0.54 | |||||||||
Book value per common share (c) | 27.98 | 25.57 | 27.98 | 25.57 | |||||||||
Tangible book value per common share (b)(c) | $ | 19.44 | $ | 17.17 | $ | 19.44 | $ | 17.17 | |||||
Weighted-average number of common shares outstanding – basic | 20,277,028 | 19,160,728 | 19,824,035 | 18,646,266 | |||||||||
Weighted-average number of common shares outstanding – diluted | 20,442,366 | 19,283,381 | 19,972,350 | 18,773,169 | |||||||||
Common shares outstanding at end of period | 20,696,041 | 19,528,952 | 20,696,041 | 19,528,952 | |||||||||
Closing stock price at end of period | $ | 32.26 | $ | 37.78 | $ | 32.26 | $ | 37.78 |
At or For the Three Months Ended | At or For the Six Months Ended | ||||||||||||
June 30, | June 30, | ||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||
Significant Ratios (a) | |||||||||||||
Return on average stockholders' equity (d) | 6.81 | % | 6.46 | % | 8.87 | % | 8.39 | % | |||||
Return on average tangible equity (d)(e) | 10.55 | % | 10.47 | % | 13.49 | % | 13.21 | % | |||||
Return on average assets (d) | 0.91 | % | 0.81 | % | 1.17 | % | 1.06 | % | |||||
Return on average assets adjusted for non-core items (d)(f) | 1.44 | % | 1.35 | % | 1.47 | % | 1.34 | % | |||||
Average stockholders' equity to average assets | 13.33 | % | 12.57 | % | 13.24 | % | 12.60 | % | |||||
Average total loans to average deposits | 86.37 | % | 89.57 | % | 87.81 | % | 88.37 | % | |||||
Net interest margin (d)(g) | 3.77 | % | 3.74 | % | 3.78 | % | 3.70 | % | |||||
Efficiency ratio (h) | 73.24 | % | 74.96 | % | 68.09 | % | 68.53 | % | |||||
Efficiency ratio adjusted for non-core items (i) | 60.21 | % | 62.03 | % | 61.19 | % | 61.73 | % | |||||
Pre-provision net revenue to total average assets (j) | 1.21 | % | 1.10 | % | 1.49 | % | 1.44 | % | |||||
Dividend payout ratio | 73.30 | % | 69.27 | % | 53.84 | % | 52.15 | % | |||||
Total investment securities as percentage of total assets (c) | 23.33 | % | 22.07 | % | 23.33 | % | 22.07 | % | |||||
Asset Quality Ratios (a) | |||||||||||||
Nonperforming loans as a percent of total loans (c)(k) | 0.71 | % | 0.67 | % | 0.71 | % | 0.67 | % | |||||
Nonperforming assets as a percent of total assets (c)(k) | 0.47 | % | 0.46 | % | 0.47 | % | 0.46 | % | |||||
Nonperforming assets as a percent of total loans and OREO (c)(k) | 0.71 | % | 0.67 | % | 0.71 | % | 0.67 | % | |||||
Criticized loans as a percent of total loans (c)(l) | 3.42 | % | 4.50 | % | 3.42 | % | 4.50 | % | |||||
Classified loans as a percent of total loans (c)(m) | 2.23 | % | 2.07 | % | 2.23 | % | 2.07 | % | |||||
Allowance for loan losses as a percent of total loans (c) | 0.75 | % | 0.72 | % | 0.75 | % | 0.72 | % | |||||
Allowance for loan losses as a percent of nonperforming loans (c)(k) | 106.57 | % | 106.77 | % | 106.57 | % | 106.77 | % | |||||
Provision for loan losses as a percent of average total loans | 0.09 | % | 0.18 | % | 0.03 | % | 0.26 | % | |||||
Net charge-offs (recoveries) as a percentage of average total loans | 0.03 | % | 0.11 | % | (0.06 | )% | 0.22 | % | |||||
Capital Information (a)(c) | |||||||||||||
Common equity tier 1 capital ratio (n) | 14.16 | % | 13.03 | % | 14.16 | % | 13.03 | % | |||||
Tier 1 risk-based capital ratio | 14.41 | % | 13.29 | % | 14.41 | % | 13.29 | % | |||||
Total risk-based capital ratio (tier 1 and tier 2) | 15.14 | % | 13.99 | % | 15.14 | % | 13.99 | % | |||||
Leverage ratio | 10.26 | % | 9.73 | % | 10.26 | % | 9.73 | % | |||||
Common equity tier 1 capital | $ | 410,979 | $ | 358,987 | $ | 410,979 | $ | 358,987 | |||||
Tier 1 capital | 418,347 | 366,182 | 418,347 | 366,182 | |||||||||
Total capital (tier 1 and tier 2) | 439,704 | 385,448 | 439,704 | 385,448 | |||||||||
Total risk-weighted assets | $ | 2,903,387 | $ | 2,755,112 | $ | 2,903,387 | $ | 2,755,112 | |||||
Total stockholders' equity to total assets | 13.54 | % | 12.57 | % | 13.54 | % | 12.57 | % | |||||
Tangible equity to tangible assets (b) | 9.81 | % | 9.07 | % | 9.81 | % | 9.07 | % |
(a) | Reflects the impact of the acquisition of First Prestonsburg Bancshares Inc. ("First Prestonsburg") beginning April 12, 2019, and of ASB Financial Corp. ("ASB") beginning April 13, 2018. |
(b) | These amounts represent non-US GAAP financial measures since they exclude the balance sheet impact of goodwill and other intangible assets acquired through acquisitions on total stockholders’ equity and total assets. Additional information regarding the calculation of these non-US GAAP financial measures can be found under the caption “Capital/Stockholders’ Equity.” |
(c) | Data presented as of the end of the period indicated. |
(d) | Ratios are presented on an annualized basis. |
(e) | Return on average tangible equity represents a non-US GAAP financial measures since it excludes the after-tax impact of amortization of other intangible assets from earnings and it excludes the balance sheet impact of goodwill and other intangible assets acquired through acquisitions on total stockholders’ equity. Additional information regarding the calculation of this non-US GAAP financial measure can be found under the caption “Return on Average Tangible Equity Ratio.” |
(f) | Return on average assets adjusted for non-core items represents a non-US GAAP financial measure since it excludes the impact of the Tax Cuts and Jobs Act on the remeasurement of deferred tax assets and deferred tax liabilities, and the after-tax impact of all gains and/or losses, core banking system conversion revenue and expenses, acquisition-related expenses, pension settlement charges, and other non-recurring expenses in earnings. Additional information regarding the calculation of this non-US GAAP financial measure can be found under the caption "Return on Average Assets Adjusted for Non-Core Items." |
(g) | Information presented on a fully tax-equivalent basis. |
(h) | The efficiency ratio is defined as total non-interest expense (less amortization of other intangible assets) as a percentage of fully tax-equivalent net interest income plus total non-interest income (excluding all gains and losses). This amount represents a non-US GAAP financial measure since it |
(i) | The efficiency ratio adjusted for non-core items is defined as core non-interest expense (less amortization of other intangible assets) as a percentage of fully tax-equivalent net interest income plus core non-interest income excluding all gains and losses. This amount represents a non-US GAAP financial measure since it excludes the impact of all gains and/or losses, and acquisition-related expenses included in earnings, and uses fully tax-equivalent net interest income. Additional information regarding the calculation of this non-US GAAP financial measure can be found under the caption “Efficiency Ratio.” |
(j) | Pre-provision net revenue is defined as net interest income plus total non-interest income (excluding all gains and losses) minus total non-interest expense. This ratio represents a non-US GAAP financial measure since it excludes the provision for loan losses and all gains and/or losses included in earnings. This measure is a key metric used by federal bank regulatory agencies in their evaluation of capital adequacy for financial institutions. Additional information regarding the calculation of this non-US GAAP financial measure can be found under the caption “Pre-Provision Net Revenue.” |
(k) | Nonperforming loans include loans 90+ days past due and accruing, renegotiated loans and nonaccrual loans. Nonperforming assets include nonperforming loans and other real estate owned. |
(l) | Includes loans categorized as special mention, substandard and doubtful. |
(m) | Includes loans categorized as substandard and doubtful. |
(n) | Peoples' capital conservation buffer was 7.14% at June 30, 2019 and 5.99% at June 30, 2018, compared to 2.50% for the fully phased-in capital conservation buffer required at January 1, 2019. |
(1) | the success, impact, and timing of the implementation of Peoples' business strategies, including the successful integration of the business of First Prestonsburg, and the expansion of consumer lending activity; |
(2) | risks and uncertainties associated with Peoples' entry into new geographic markets and risks resulting from Peoples' inexperience in these new geographic markets; |
(3) | Peoples' ability to integrate future acquisitions, which may be unsuccessful, or may be more difficult, time-consuming or costly than expected; |
(4) | competitive pressures among financial institutions, or from non-financial institutions, which may increase significantly, including product and pricing pressures, changes to third-party relationships and revenues, changes in the manner of providing services, customer acquisition and retention pressures, and Peoples' ability to attract, develop and retain qualified professionals; |
(5) | changes in the interest rate environment due to economic conditions and/or the fiscal policies of the United States ("U.S.") government and the Board of Governors of the Federal Reserve System (the "Federal Reserve Board"), which may adversely impact interest rates, interest margins, loan demand and interest rate sensitivity; |
(6) | uncertainty regarding the nature, timing, cost, and effect of legislative or regulatory changes or actions, promulgated and to be promulgated by governmental and regulatory agencies in the state of Ohio, the Federal Deposit Insurance Corporation, the Federal Reserve Board and the Consumer Financial Protection Bureau, which may subject Peoples, its subsidiaries, or one or more acquired companies to a variety of new and more stringent legal and regulatory requirements which adversely affect their respective businesses, including in particular the rules and regulations promulgated and to be promulgated under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, and the Basel III regulatory capital reform; |
(7) | the effects of easing restrictions on participants in the financial services industry; |
(8) | local, regional, national and international economic conditions (including the impact of potential or imposed tariffs, a U.S. withdrawal from or significant renegotiation of trade agreements, trade wars and other changes in trade regulations) and the impact these conditions may have on Peoples, its customers and its counterparties, and Peoples' assessment of the impact, which may be different than anticipated; |
(9) | the existence or exacerbation of general geopolitical instability and uncertainty; |
(10) | changes in policy and other regulatory and legal developments, and uncertainty or speculation pending the enactment of such changes; |
(11) | Peoples may issue equity securities in connection with future acquisitions, which could cause ownership and economic dilution to Peoples' current shareholders; |
(12) | changes in prepayment speeds, loan originations, levels of nonperforming assets, delinquent loans and charge-offs, which may be less favorable than expected and adversely impact the amount of interest income generated; |
(13) | adverse changes in economic conditions and/or activities, including, but not limited to, continued economic uncertainty in the U.S., the European Union (including the uncertainty surrounding the actions to be taken to implement the referendum by British voters to exit the European Union), Asia, and other areas, which could decrease sales volumes, add volatility to the global stock markets, and increase loan delinquencies and defaults; |
(14) | deterioration in the credit quality of Peoples' loan portfolio, which may adversely impact the provision for loan losses; |
(15) | Peoples may have more credit risk and higher credit losses to the extent loans are concentrated by location or industry of the borrowers or collateral; |
(16) | changes in accounting standards, policies, estimates or procedures, including the new current expected credit loss rule issued by the Financial Accounting Standards Board in June 2016, which will require banks to record, at the time of origination, credit losses expected throughout the life of the asset portfolio on loans and held-to-maturity securities, as opposed to the current practice of recording losses when it is probable that a loss event has occurred, which may adversely affect Peoples' reported financial condition or results of operations; |
(17) | Peoples' assumptions and estimates used in applying critical accounting policies, which may prove unreliable, inaccurate or not predictive of actual results; |
(18) | the discontinuation of the London Inter-Bank Offered Rate and other reference rates may result in increased expenses and litigation, and adversely impact the effectiveness of hedging strategies; |
(19) | adverse changes in the conditions and trends in the financial markets, including political developments, which may adversely affect the fair value of securities within Peoples' investment portfolio, the interest rate sensitivity of Peoples' consolidated balance sheet, and the income generated by Peoples' trust and investment activities; |
(20) | the volatility from quarter to quarter of mortgage banking income, whether due to interest rates, demand, the fair value of mortgage loans, or other factors; |
(21) | Peoples' ability to receive dividends from its subsidiaries; |
(22) | Peoples' ability to maintain required capital levels and adequate sources of funding and liquidity; |
(23) | the impact of larger or similar-sized financial institutions encountering problems, which may adversely affect the banking industry and/or Peoples' business generation and retention, funding and liquidity; |
(24) | the costs and effects of new federal and state laws, and other regulatory and legal developments, including the outcome of potential regulatory or other governmental inquiries and legal proceedings and results of regulatory examinations; |
(25) | Peoples' ability to secure confidential information and deliver products and services through the use of computer systems and telecommunications networks, including those of Peoples' third-party vendors and other service providers, which may prove inadequate, and could adversely affect customer confidence in Peoples and/or result in Peoples incurring a financial loss; |
(26) | Peoples' ability to anticipate and respond to technological changes, and Peoples' reliance on, and the potential failure of, a number of third-party vendors to perform as expected, including Peoples' primary core banking system provider, which can impact Peoples' ability to respond to customer needs and meet competitive demands; |
(27) | operational issues stemming from and/or capital spending necessitated by the potential need to adapt to industry changes in information technology systems on which Peoples and its subsidiaries are highly dependent; |
(28) | changes in consumer spending, borrowing and saving habits, whether due to tax reform legislation, changes in retail distribution strategies, consumer preferences and behavior, changes in business and economic conditions, legislative or regulatory initiatives, or other factors, which may be different than anticipated; |
(29) | the adequacy of Peoples' internal controls and risk management program in the event of changes in strategic, reputational, market, economic, operational, cyber security, compliance, legal, asset/liability repricing, liquidity, credit and interest rate risks associated with Peoples' business; |
(30) | the impact on Peoples' businesses, personnel, facilities, or systems, related to fraud, theft, or violence; |
(31) | the impact on Peoples' businesses, as well as on the risks described above, of various domestic or international widespread natural or other disasters, pandemics, cyber attacks, civil unrest, military or terrorist activities or international conflicts; |
(32) | Peoples' continued ability to grow deposits; and |
(33) | other risk factors relating to the banking industry or Peoples as detailed from time to time in Peoples’ reports filed with the Securities and Exchange Commission (the "SEC"), including those risk factors included in the disclosures under the heading "ITEM 1A. RISK FACTORS" of Peoples’ Annual Report on Form 10-K for the fiscal year ended December 31, 2018 and under the heading "ITEM 1A. RISK FACTORS" in Part II of this Form 10-Q. |
◦ | On April 12, 2019, Peoples completed the previously-announced merger with First Prestonsburg. First Prestonsburg merged into Peoples and First Prestonsburg's wholly-owned subsidiary, First Commonwealth Bank of Prestonsburg, Inc., which operated nine full-service bank branches in central and eastern Kentucky, merged into Peoples Bank. Total purchase price of $43.7 million was paid in the merger, of which $11.3 million was in the form of a special cash dividend paid by First Prestonsburg to shareholders of First Prestonsburg prior to the merger with the remainder being paid in the form of an aggregate of 1,005,478 Peoples common shares by Peoples. The merger added $130.4 million of total loans and $257.2 million of total deposits at the acquisition date, after preliminary fair value adjustments. Peoples also recorded $4.2 million of other intangible assets and $12.0 million of goodwill. These amounts reflect information available through the date of the filing of this Quarterly Report on Form 10-Q. Refer to "Note 12 Acquisitions" of the Notes to the Unaudited Consolidated Financial Statements for additional information. |
◦ | At the close of business on April 13, 2018, Peoples completed the merger with ASB. ASB merged into Peoples, and ASB's wholly-owned subsidiary, American Savings Bank, fsb, which operated seven full-service bank branches and two loan production offices in southern Ohio and eastern Kentucky, merged into Peoples Bank. Under the terms of the merger agreement, Peoples paid total consideration of $41.5 million. The merger added $239.2 million of total loans and loans held for sale in the aggregate, and $198.6 million of total deposits at the acquisition date, after acquisition accounting adjustments. Peoples also recorded $2.6 million of other intangible assets and $18.1 million of goodwill. |
◦ | During the second quarter of 2019, Peoples incurred $7.0 million of acquisition-related costs, compared to $253,000 in the first quarter of 2019, and $6.3 million in the second quarter of 2018. During the first six months of 2019, Peoples incurred $7.3 million of acquisition-related costs, compared to $6.4 million during the first six months of 2018. The acquisition costs in 2019 and 2018 were primarily related to the First Prestonsburg and ASB mergers, respectively, and were primarily related to fees associated with early termination of contracts, severance costs and write-offs associated with assets acquired. |
◦ | During the second quarter of 2019, Peoples entered into $30.0 million of interest rate swaps, with a notional value in aggregate of $30.0 million, which became effective immediately and will mature between 2023 and 2026, with interest rates ranging from 1.89% to 1.91%. For additional information regarding Peoples' interest rate swaps, refer to "Note 9 Derivative Financial Instruments" of the Notes to the Unaudited Consolidated Financial Statements. |
◦ | During the first quarter of 2019, Peoples recognized a $1.8 million recovery on a previously charged-off commercial loan. |
◦ | During the second quarter of 2019, Peoples closed one full-service bank branch located in West Virginia when the lease expired in June 2019. During the first quarter of 2019, Peoples closed one insurance office located in Ohio when the lease for the location expired at the end of January 2019 and one full-service bank branch located in West Virginia when the lease for the location expired in March 2019. Employees at the closed locations were relocated to other branches or offices. |
◦ | On April 22, 2019, Peoples Bank signed an agreement to open a Federal Funds liquidity facility with Canadian Imperial Bank of Commerce, which either party may cancel at any time. The $20.0 million line increases Peoples Bank's contingent liquidity and will serve to help manage Peoples Bank's daily liquidity needs. As of June 30, 2019, Peoples Bank had not borrowed under the agreement. |
◦ | On April 3, 2019, Peoples entered into a Loan Agreement (the “U.S. Bank Loan Agreement”) with U.S. Bank National Association. The U.S. Bank Loan Agreement has a one-year term and provides Peoples with a revolving line of credit in the maximum aggregate principal amount of $20.0 million that may be used: (i) for working capital |
◦ | Effective April 3, 2019, Peoples terminated the Credit Agreement, dated as of March 4, 2016 between Peoples, as Borrower, and Raymond James Bank, N.A., as Lender (the "RJB Credit Agreement"), with a revolving line of credit in the maximum aggregate principal amount of $15.0 million. |
◦ | During the first quarter of 2019, Peoples sold its restricted Class B Visa stock, which had been held at a carrying cost and fair value of zero due to the litigation liability associated with the stock, resulting in a gain of $787,000 recorded in other non-interest income. |
◦ | Multiple items impacted Peoples' income tax expense during 2018, primarily as a result of the Tax Cuts and Jobs Act, which lowered the statutory federal corporate income tax rate to 21% as of January 1, 2018, from a previous rate of 35%. There were no similar items in 2019. |
▪ | Beginning on January 1, 2018, Peoples began recognizing income tax expense at the 21% statutory federal corporate income tax rate. |
▪ | During the fourth quarter of 2018, Peoples finalized the remeasurement of its net deferred tax assets and liabilities at the new statutory federal corporate income tax rate of 21%, which resulted in a reduction to income tax expense of $705,000 in 2018. The final adjustment was mainly due to Peoples' contribution of $3.2 million to Peoples' defined benefit pension plan during 2018. |
▪ | During 2018, Peoples released a valuation allowance, which reduced income tax expense by $0.8 million. The valuation allowance was related to a historical tax credit that Peoples had invested in during 2015. Peoples sold $6.7 million of equity investment securities in the second quarter of 2018, which resulted in a capital gain for tax purposes. This capital gain was large enough to offset an anticipated future capital loss, which is expected to be recognized due to the structure of the historical tax credit investment, resulting in the release of the valuation allowance. |
◦ | During the fourth quarter of 2018, Peoples incurred $91,000 in pension settlement costs due to the aggregate amount of lump-sum distributions to participants in Peoples' defined benefit pension plan exceeding the threshold for recognizing such charges during the period. There were no such costs during the first or second quarters of 2019 or the first or second quarters of 2018. |
◦ | On July 31, 2018, Peoples entered into $50.0 million of interest rate swaps, which became effective immediately and will mature between 2021 and 2028, with interest rates ranging from 2.92% to 3.00%. Additionally, the three interest rate swaps acquired with the ASB acquisition matured in July of 2018. These swaps locked in funding rates for $40.0 million, in notional value, in FHLB advances that matured in 2018, which had interest rates ranging from 3.57% to 3.92%. For additional information regarding Peoples' interest rate swaps, refer to "Note 9 Derivative Financial Instruments" of the Notes to the Unaudited Consolidated Financial Statements. |
◦ | On January 1, 2018, Peoples adopted ASU 2016-01, resulting in the reclassification of $7.8 million of equity investment securities from available-for-sale investment securities to other investment securities and the reclassification of $5.0 million in net unrealized gains on equity investment securities from accumulated other comprehensive loss to retained earnings. |
◦ | The Federal Reserve Board began tightening monetary policy in December 2015 by raising the benchmark Federal Funds Target Rate. Since then, the rate has increased several times from a range of 0.25% to 0.50% to its current range of 2.25% to 2.50%. Market participants are now expecting two eases this year and potentially one early next year. While recent economic numbers have been fairly strong, the Federal Reserve Board is contemplating lowering rates in order to prevent the economy from slipping into what many investors believe is a long-overdue recession. The Federal Reserve Board has also indicated it would pause reducing its balance sheet beginning in September 2019 as planned. As a result, interest rates will likely remain rather low throughout the rest of 2019. Peoples is closely monitoring interest rates, both foreign and domestic; and potential impacts of changes in interest rates to Peoples' operations. |
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, 2019 | March 31, 2019 | June 30, 2018 | June 30, | |||||||||||||
(Dollars in thousands) | 2019 | 2018 | ||||||||||||||
Net interest income | $ | 36,049 | 33,914 | $ | 32,808 | $ | 69,963 | $ | 62,167 | |||||||
Taxable equivalent adjustments | 267 | 200 | 223 | 467 | 450 | |||||||||||
Fully tax-equivalent net interest income | $ | 36,316 | $ | 34,114 | $ | 33,033 | $ | 70,430 | $ | 62,617 |
For the Three Months Ended | ||||||||||||||||||||||||||
June 30, 2019 | March 31, 2019 | June 30, 2018 | ||||||||||||||||||||||||
(Dollars in thousands) | Average Balance | Income/ Expense | Yield/Cost | Average Balance | Income/ Expense | Yield/Cost | Average Balance | Income/ Expense | Yield/Cost | |||||||||||||||||
Short-term investments | $ | 27,979 | $ | 263 | 3.77 | % | $ | 16,247 | $ | 176 | 4.39 | % | $ | 10,815 | $ | 56 | 2.00 | % | ||||||||
Investment securities (a)(b): | ||||||||||||||||||||||||||
Taxable (c) | 874,427 | 6,006 | 2.75 | % | 780,721 | 5,847 | 3.00 | % | 793,497 | 5,868 | 2.96 | % | ||||||||||||||
Nontaxable | 118,241 | 923 | 3.12 | % | 83,319 | 680 | 3.26 | % | 96,991 | 804 | 3.32 | % | ||||||||||||||
Total investment securities | 992,668 | 6,929 | 2.79 | % | 864,040 | 6,527 | 3.03 | % | 890,488 | 6,672 | 3.00 | % | ||||||||||||||
Loans (b)(d): | ||||||||||||||||||||||||||
Commercial real estate, construction | 124,334 | 1,655 | 5.27 | % | 131,683 | 1,732 | 5.26 | % | 118,206 | 1,438 | 4.81 | % | ||||||||||||||
Commercial real estate, other | 833,991 | 11,322 | 5.37 | % | 806,181 | 10,596 | 5.26 | % | 840,677 | 10,434 | 4.91 | % | ||||||||||||||
Commercial and industrial | 599,432 | 8,081 | 5.33 | % | 578,954 | 7,681 | 5.31 | % | 503,364 | 6,216 | 4.89 | % | ||||||||||||||
Residential real estate (e) | 646,978 | 7,918 | 4.90 | % | 603,253 | 6,927 | 4.59 | % | 600,799 | 6,749 | 4.49 | % | ||||||||||||||
Home equity lines of credit | 132,395 | 2,006 | 6.08 | % | 131,089 | 1,860 | 5.75 | % | 131,970 | 1,701 | 5.17 | % | ||||||||||||||
Consumer, indirect | 412,986 | 4,255 | 4.13 | % | 409,975 | 4,088 | 4.04 | % | 359,941 | 3,498 | 3.90 | % | ||||||||||||||
Consumer, direct | 80,442 | 1,459 | 7.27 | % | 73,457 | 1,189 | 6.56 | % | 72,820 | 1,230 | 6.77 | % | ||||||||||||||
Total loans | 2,830,558 | 36,696 | 5.20 | % | 2,734,592 | 34,073 | 5.00 | % | 2,627,777 | 31,266 | 4.73 | % | ||||||||||||||
Allowance for loan losses | (21,311 | ) | (20,406 | ) | (19,071 | ) | ||||||||||||||||||||
Net loans | 2,809,247 | 36,696 | 5.20 | % | 2,714,186 | 34,073 | 5.04 | % | 2,608,706 | 31,266 | 4.77 | % | ||||||||||||||
Total earning assets | 3,829,894 | 43,888 | 4.56 | % | 3,594,473 | 40,776 | 4.55 | % | 3,510,009 | 37,994 | 4.31 | % | ||||||||||||||
Goodwill and other intangible assets | 175,169 | 161,673 | 161,600 | |||||||||||||||||||||||
Other assets | 234,716 | 229,475 | 226,348 | |||||||||||||||||||||||
Total assets | $ | 4,239,779 | $ | 3,985,621 | $ | 3,897,957 | ||||||||||||||||||||
Deposits: | ||||||||||||||||||||||||||
Savings accounts | $ | 523,295 | $ | 110 | 0.08 | % | $ | 472,656 | $ | 91 | 0.08 | % | $ | 477,167 | $ | 69 | 0.06 | % | ||||||||
Governmental deposit accounts | 331,607 | 848 | 1.03 | % | 297,537 | 557 | 0.76 | % | 312,999 | 273 | 0.35 | % | ||||||||||||||
Interest-bearing demand accounts | 603,494 | 231 | 0.15 | % | 569,472 | 247 | 0.18 | % | 581,600 | 202 | 0.14 | % | ||||||||||||||
Money market accounts | 414,307 | 654 | 0.63 | % | 395,324 | 531 | 0.54 | % | 393,580 | 323 | 0.33 | % | ||||||||||||||
Retail certificates of deposit | 477,530 | 2,079 | 1.75 | % | 396,977 | 1,417 | 1.45 | % | 395,304 | 1,242 | 1.26 | % | ||||||||||||||
Brokered certificates of deposit | 272,693 | 1,797 | 2.64 | % | 314,163 | 2,001 | 2.58 | % | 187,387 | 992 | 2.13 | % | ||||||||||||||
Total interest-bearing deposits | 2,622,926 | 5,719 | 0.87 | % | 2,446,129 | 4,844 | 0.80 | % | 2,348,037 | 3,101 | 0.53 | % | ||||||||||||||
Borrowed funds: | ||||||||||||||||||||||||||
Short-term FHLB advances | 193,963 | 1,140 | 2.36 | % | 198,643 | 1,115 | 2.28 | % | 225,635 | 966 | 1.72 | % | ||||||||||||||
Repurchase agreements and other | 46,631 | 93 | 0.80 | % | 46,111 | 58 | 0.50 | % | 85,188 | 209 | 0.98 | % | ||||||||||||||
Total short-term borrowings | 240,594 | 1,233 | 2.06 | % | 244,754 | 1,173 | 1.94 | % | 310,823 | 1,175 | 1.52 | % | ||||||||||||||
Long-term FHLB advances | 96,519 | 491 | 2.04 | % | 100,930 | 508 | 2.04 | % | 114,287 | 559 | 1.96 | % | ||||||||||||||
Other borrowings | 7,346 | 129 | 7.02 | % | 7,304 | 137 | 7.50 | % | 7,766 | 126 | 6.49 | % | ||||||||||||||
Total long-term borrowings | 103,865 | 620 | 2.39 | % | 108,234 | 645 | 2.41 | % | 122,053 | 685 | 2.25 | % | ||||||||||||||
Total borrowed funds | 344,459 | 1,853 | 2.16 | % | 352,988 | 1,818 | 2.09 | % | 432,876 | 1,860 | 1.72 | % | ||||||||||||||
Total interest-bearing liabilities | 2,967,385 | 7,572 | 1.02 | % | 2,799,117 | 6,662 | 0.96 | % | 2,780,913 | 4,961 | 0.71 | % | ||||||||||||||
Non-interest-bearing deposits | 654,468 | 613,924 | 585,800 | |||||||||||||||||||||||
Other liabilities | 52,934 | 48,384 | 41,368 | |||||||||||||||||||||||
Total liabilities | 3,674,787 | 3,461,425 | 3,408,081 | |||||||||||||||||||||||
Total stockholders’ equity | 564,992 | 524,196 | 489,876 | |||||||||||||||||||||||
Total liabilities and stockholders’ equity | $ | 4,239,779 | $ | 3,985,621 | $ | 3,897,957 | ||||||||||||||||||||
Interest rate spread (b) | $ | 36,316 | 3.54 | % | $ | 34,114 | 3.59 | % | $ | 33,033 | 3.60 | % | ||||||||||||||
Net interest margin (b) | 3.77 | % | 3.80 | % | 3.74 | % |
For the Six Months Ended | |||||||||||||||||
June 30, 2019 | June 30, 2018 | ||||||||||||||||
(Dollars in thousands) | Average Balance | Income/ Expense | Yield/Cost | Average Balance | Income/ Expense | Yield/Cost | |||||||||||
Short-term investments | $ | 22,145 | $ | 439 | 4.00 | % | $ | 11,052 | $ | 106 | 1.93 | % | |||||
Investment securities (a)(b): | |||||||||||||||||
Taxable | 827,831 | 11,853 | 2.86 | % | 784,628 | 11,555 | 2.95 | % | |||||||||
Nontaxable | 100,876 | 1,603 | 3.18 | % | 97,062 | 1,618 | 3.33 | % | |||||||||
Total investment securities | 928,707 | 13,456 | 2.90 | % | 881,690 | 13,173 | 2.99 | % | |||||||||
Loans (b)(c): | |||||||||||||||||
Commercial real estate, construction | 127,988 | 3,387 | 5.26 | % | 118,396 | 2,771 | 4.66 | % | |||||||||
Commercial real estate, other | 820,163 | 21,918 | 5.32 | % | 803,085 | 19,558 | 4.84 | % | |||||||||
Commercial and industrial | 589,249 | 15,762 | 5.32 | % | 491,643 | 11,787 | 4.77 | % | |||||||||
Residential real estate (d) | 625,236 | 14,845 | 4.75 | % | 546,558 | 12,058 | 4.41 | % | |||||||||
Home equity lines of credit | 131,746 | 3,866 | 5.92 | % | 120,360 | 2,972 | 4.98 | % | |||||||||
Consumer, indirect | 411,489 | 8,343 | 4.09 | % | 351,581 | 6,628 | 3.80 | % | |||||||||
Consumer, other | 76,969 | 2,648 | 6.94 | % | 70,633 | 2,392 | 6.83 | % | |||||||||
Total loans | 2,782,840 | 70,769 | 5.07 | % | 2,502,256 | 58,166 | 4.64 | % | |||||||||
Less: Allowance for loan losses | (20,861 | ) | (18,878 | ) | |||||||||||||
Net loans | 2,761,979 | 70,769 | 5.12 | % | 2,483,378 | 58,166 | 4.68 | % | |||||||||
Total earning assets | 3,712,831 | 84,664 | 4.55 | % | 3,376,120 | 71,445 | 4.23 | % | |||||||||
Intangible assets | 168,458 | 152,943 | |||||||||||||||
Other assets | 232,114 | 219,268 | |||||||||||||||
Total assets | $ | 4,113,403 | $ | 3,748,331 | |||||||||||||
Deposits: | |||||||||||||||||
Savings accounts | $ | 498,115 | $ | 201 | 0.08 | % | $ | 465,091 | $ | 133 | 0.06 | % | |||||
Governmental deposit accounts | 314,666 | 1,405 | 0.90 | % | 302,286 | 490 | 0.33 | % | |||||||||
Interest-bearing demand accounts | 586,577 | 478 | 0.16 | % | 574,465 | 423 | 0.15 | % | |||||||||
Money market accounts | 404,868 | 1,185 | 0.59 | % | 380,834 | 549 | 0.29 | % | |||||||||
Retail certificates of deposit | 437,476 | 3,496 | 1.61 | % | 366,923 | 2,007 | 1.10 | % | |||||||||
Brokered certificates of deposit | 293,313 | 3,798 | 2.61 | % | 172,101 | 1,712 | 2.01 | % | |||||||||
Total interest-bearing deposits | 2,535,015 | 10,563 | 0.84 | % | 2,261,700 | 5,314 | 0.47 | % | |||||||||
Borrowed funds: | |||||||||||||||||
Short-term FHLB advances | 196,290 | 2,255 | 2.32 | % | 185,195 | 1,629 | 1.77 | % | |||||||||
Repurchase agreements and other | 46,373 | 151 | 0.65 | % | 93,634 | 514 | 1.10 | % | |||||||||
Total short-term borrowings | 242,663 | 2,406 | 2.00 | % | 278,829 | 2,143 | 1.55 | % | |||||||||
Long-term FHLB advances | 98,712 | 999 | 2.04 | % | 116,628 | 1,123 | 1.94 | % | |||||||||
Other borrowings | 7,325 | 266 | 7.26 | % | 7,439 | 248 | 6.67 | % | |||||||||
Total long-term borrowings | 106,037 | 1,265 | 2.40 | % | 124,067 | 1,371 | 2.22 | % | |||||||||
Total borrowed funds | 348,700 | 3,671 | 2.12 | % | 402,896 | 3,514 | 1.75 | % | |||||||||
Total interest-bearing liabilities | 2,883,715 | 14,234 | 0.99 | % | 2,664,596 | 8,828 | 0.67 | % | |||||||||
Non-interest-bearing deposits | 634,308 | 569,711 | |||||||||||||||
Other liabilities | 50,674 | 41,872 | |||||||||||||||
Total liabilities | 3,568,697 | 3,276,179 | |||||||||||||||
Total stockholders’ equity | 544,706 | 472,152 | |||||||||||||||
Total liabilities and stockholders’ equity | $ | 4,113,403 | $ | 3,748,331 | |||||||||||||
Interest rate spread (b) | $ | 70,430 | 3.56 | % | $ | 62,617 | 3.56 | % | |||||||||
Net interest margin (b) | 3.78 | % | 3.70 | % |
(a) | Average balances are based on carrying value. |
(b) | Interest income and yields are presented on a fully tax-equivalent basis using a 21% statutory federal corporate income tax rate. |
(c) | Interest income and yield presented for the second quarter of 2018 include $248,000 of proceeds on an investment security for which an other-than-temporary-impairment had been recorded in previous years. Interest income and yield presented for the first six months of 2018 include $589,000 of proceeds on an investment security for which an other-than-temporary-impairment had been recorded in previous years. |
(d) | Average balances include nonaccrual, impaired loans and loans held for sale. Interest income includes interest earned and received on nonaccrual loans prior to the loans being placed on nonaccrual status. Loan fees included in interest income were immaterial for all periods presented. |
(e) | Loans held for sale are included in the average loan balance listed. Related interest income on loans originated for sale prior to the loan being sold is included in loan interest income. |
Three Months Ended June 30, 2019 Compared to | Compared to | ||||||||||||||||||||||||||||
(Dollars in thousands) | March 31, 2019 | June 30, 2018 | June 30, 2018 | ||||||||||||||||||||||||||
Increase (decrease) in: | Rate | Volume | Total (a) | Rate | Volume | Total (a) | Rate | Volume | Total (a) | ||||||||||||||||||||
INTEREST INCOME: | |||||||||||||||||||||||||||||
Short-term investments | $ | (155 | ) | $ | 242 | $ | 87 | $ | 74 | $ | 133 | $ | 207 | $ | 169 | $ | 164 | $ | 333 | ||||||||||
Investment Securities (b): | |||||||||||||||||||||||||||||
Taxable | (2,234 | ) | 2,393 | 159 | (1,908 | ) | 2,046 | 138 | 282 | 16 | 298 | ||||||||||||||||||
Nontaxable | (191 | ) | 434 | 243 | (271 | ) | 390 | 119 | (14 | ) | (1 | ) | (15 | ) | |||||||||||||||
Total investment income | (2,425 | ) | 2,827 | 402 | (2,179 | ) | 2,436 | 257 | 268 | 15 | 283 | ||||||||||||||||||
Loans (b): | |||||||||||||||||||||||||||||
Commercial real estate, construction | 11 | (88 | ) | (77 | ) | 140 | 77 | 217 | 380 | 236 | 616 | ||||||||||||||||||
Commercial real estate, other | 280 | 446 | 726 | 1,424 | (536 | ) | 888 | 1,937 | 423 | 2,360 | |||||||||||||||||||
Commercial and industrial | 50 | 350 | 400 | 604 | 1,261 | 1,865 | 1,464 | 2,511 | 3,975 | ||||||||||||||||||||
Residential real estate | 471 | 520 | 991 | 629 | 540 | 1,169 | 965 | 1,822 | 2,787 | ||||||||||||||||||||
Home equity lines of credit | 124 | 22 | 146 | 299 | 6 | 305 | 595 | 299 | 894 | ||||||||||||||||||||
Consumer, indirect | 125 | 42 | 167 | 219 | 538 | 757 | 527 | 1,188 | 1,715 | ||||||||||||||||||||
Consumer, direct | 145 | 125 | 270 | 85 | 144 | 229 | 236 | 20 | 256 | ||||||||||||||||||||
Total loan income | 1,206 | 1,417 | 2,623 | 3,400 | 2,030 | 5,430 | 6,104 | 6,499 | 12,603 | ||||||||||||||||||||
Total interest income | $ | (1,374 | ) | $ | 4,486 | $ | 3,112 | $ | 1,295 | $ | 4,599 | $ | 5,894 | $ | 6,541 | $ | 6,678 | $ | 13,219 | ||||||||||
INTEREST EXPENSE: | |||||||||||||||||||||||||||||
Deposits: | |||||||||||||||||||||||||||||
Savings accounts | $ | 8 | $ | 11 | $ | 19 | $ | 34 | $ | 7 | $ | 41 | $ | 58 | $ | 10 | $ | 68 | |||||||||||
Governmental deposit accounts | 220 | 71 | 291 | 558 | 17 | 575 | 894 | 21 | 915 | ||||||||||||||||||||
Interest-bearing demand accounts | (92 | ) | 76 | (16 | ) | 21 | 8 | 29 | 46 | 9 | 55 | ||||||||||||||||||
Money market accounts | 94 | 29 | 123 | 313 | 18 | 331 | 599 | 37 | 636 | ||||||||||||||||||||
Retail certificates of deposit | 334 | 328 | 662 | 544 | 293 | 837 | 1,051 | 438 | 1,489 | ||||||||||||||||||||
Brokered certificates of deposit | 291 | (495 | ) | (204 | ) | 281 | 524 | 805 | 626 | 1,460 | 2,086 | ||||||||||||||||||
Total deposit cost | 855 | 20 | 875 | 1,751 | 867 | 2,618 | 3,274 | 1,975 | 5,249 | ||||||||||||||||||||
Borrowed funds: | |||||||||||||||||||||||||||||
Short-term borrowings | 180 | (120 | ) | 60 | 886 | (828 | ) | 58 | 679 | (416 | ) | 263 | |||||||||||||||||
Long-term borrowings | (13 | ) | (12 | ) | (25 | ) | 136 | (201 | ) | (65 | ) | 171 | (277 | ) | (106 | ) | |||||||||||||
Total borrowed funds cost | 167 | (132 | ) | 35 | 1,022 | (1,029 | ) | (7 | ) | 850 | (693 | ) | 157 | ||||||||||||||||
Total interest expense | 1,022 | (112 | ) | 910 | 2,773 | (162 | ) | 2,611 | 4,124 | 1,282 | 5,406 | ||||||||||||||||||
Net interest income | $ | (2,396 | ) | $ | 4,598 | $ | 2,202 | $ | (1,478 | ) | $ | 4,761 | $ | 3,283 | $ | 2,417 | $ | 5,396 | $ | 7,813 |
(a) | The change in interest due to both rate and volume has been allocated to rate and volume changes in proportion to the relationship of the dollar amounts of the changes in each. |
(b) | Interest income and yields are presented on a fully tax-equivalent basis using a 21% statutory federal corporate income tax rate. |
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, 2019 | March 31, 2019 | June 30, 2018 | June 30, | |||||||||||||
(Dollars in thousands) | 2019 | 2018 | ||||||||||||||
Provision for (recovery of) other loan losses | $ | 475 | $ | (360 | ) | $ | 1,000 | $ | 115 | $ | 2,842 | |||||
Provision for checking account overdrafts | 151 | 97 | 188 | 248 | 329 | |||||||||||
Provision for (recovery of) loan losses | $ | 626 | $ | (263 | ) | $ | 1,188 | $ | 363 | $ | 3,171 | |||||
As a percentage of average total loans (a) | 0.09 | % | (0.04 | )% | 0.18 | % | 0.03 | % | 0.26 | % | ||||||
(a) Presented on an annualized basis. |
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, 2019 | March 31, 2019 | June 30, 2018 | June 30, | |||||||||||||
(Dollars in thousands) | 2019 | 2018 | ||||||||||||||
Net (loss) gain on investment securities | $ | (57 | ) | $ | 30 | $ | (147 | ) | $ | (27 | ) | $ | (146 | ) | ||
Net (loss) gain on asset disposals and other transactions: | ||||||||||||||||
Net loss on other assets | $ | (274 | ) | $ | (157 | ) | $ | (330 | ) | $ | (431 | ) | $ | (251 | ) | |
Net (loss) gain on OREO | (24 | ) | (25 | ) | 14 | (49 | ) | 9 | ||||||||
Net loss on debt extinguishment | — | — | (13 | ) | — | (13 | ) | |||||||||
Net gain (loss) on other transactions | 5 | — | (76 | ) | 5 | (76 | ) | |||||||||
Net loss on asset disposals and other transactions | $ | (293 | ) | $ | (182 | ) | $ | (405 | ) | $ | (475 | ) | $ | (331 | ) |
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, 2019 | March 31, 2019 | June 30, 2018 | June 30, | |||||||||||||
(Dollars in thousands) | 2019 | 2018 | ||||||||||||||
Property and casualty insurance commissions | $ | 2,680 | $ | 2,674 | $ | 2,597 | $ | 5,354 | $ | 5,242 | ||||||
Performance-based commissions | 2 | 1,419 | 3 | 1,421 | 1,350 | |||||||||||
Life and health insurance commissions | 626 | 359 | 596 | 985 | 1,140 | |||||||||||
Other fees and charges | 178 | 169 | 173 | 347 | 292 | |||||||||||
Insurance income | $ | 3,486 | $ | 4,621 | $ | 3,369 | $ | 8,107 | $ | 8,024 |
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, 2019 | March 31, 2019 | June 30, 2018 | June 30, | |||||||||||||
(Dollars in thousands) | 2019 | 2018 | ||||||||||||||
Fiduciary | $ | 1,837 | $ | 1,636 | $ | 1,767 | $ | 3,473 | $ | 3,374 | ||||||
Brokerage | 1,038 | 965 | 989 | 2,003 | 1,952 | |||||||||||
Employee benefits | 526 | 511 | 476 | 1,037 | 974 | |||||||||||
Trust and investment income | $ | 3,401 | $ | 3,112 | $ | 3,232 | $ | 6,513 | $ | 6,300 |
June 30, 2019 | March 31, 2019 | December 31, 2018 | September 30, 2018 | June 30, 2018 | |||||||||||
(Dollars in thousands) | |||||||||||||||
Trust assets under administration and management | $ | 1,501,110 | $ | 1,471,422 | $ | 1,384,113 | $ | 1,489,810 | $ | 1,454,009 | |||||
Brokerage assets under administration and management | 887,745 | 863,286 | 849,188 | 914,172 | 881,839 | ||||||||||
Total assets under administration and management | $ | 2,388,855 | $ | 2,334,708 | $ | 2,233,301 | $ | 2,403,982 | $ | 2,335,848 | |||||
Quarterly average | $ | 2,356,121 | $ | 2,312,098 | $ | 2,316,201 | $ | 2,378,676 | $ | 2,331,529 |
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, 2019 | March 31, 2019 | June 30, 2018 | June 30, | |||||||||||||
(Dollars in thousands) | 2019 | 2018 | ||||||||||||||
Interchange fees | $ | 2,747 | $ | 2,443 | $ | 2,520 | $ | 5,190 | $ | 4,784 | ||||||
Promotional and usage income | 520 | 544 | 265 | 1,064 | 786 | |||||||||||
E-banking income | $ | 3,267 | $ | 2,987 | $ | 2,785 | $ | 6,254 | $ | 5,570 |
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, 2019 | March 31, 2019 | June 30, 2018 | June 30, | |||||||||||||
(Dollars in thousands) | 2019 | 2018 | ||||||||||||||
Overdraft and non-sufficient funds fees | $ | 1,746 | $ | 1,433 | $ | 1,584 | $ | 3,179 | $ | 3,023 | ||||||
Account maintenance fees | 1,012 | 752 | 646 | 1,764 | 1,321 | |||||||||||
Other fees and charges | 219 | 156 | 158 | 375 | 164 | |||||||||||
Deposit account service charges | $ | 2,977 | $ | 2,341 | $ | 2,388 | $ | 5,318 | $ | 4,508 |
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, 2019 | March 31, 2019 | June 30, 2018 | June 30, | |||||||||||||
(Dollars in thousands) | 2019 | 2018 | ||||||||||||||
Mortgage banking income | $ | 1,000 | $ | 788 | $ | 969 | $ | 1,788 | $ | 1,320 | ||||||
Bank owned life insurance income | 490 | 485 | 497 | 975 | 965 | |||||||||||
Commercial loan swap fees | 516 | 146 | 146 | 662 | 262 | |||||||||||
Other non-interest income | 502 | 1,101 | 421 | 1,603 | 1,752 |
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, 2019 | March 31, 2019 | June 30, 2018 | June 30, | |||||||||||||
(Dollars in thousands) | 2019 | 2018 | ||||||||||||||
Base salaries and wages | $ | 14,353 | $ | 11,874 | $ | 12,656 | $ | 26,227 | $ | 23,028 | ||||||
Employee benefits | 1,966 | 2,690 | 1,485 | 4,656 | 3,028 | |||||||||||
Sales-based and incentive compensation | 3,096 | 2,609 | 3,003 | 5,705 | 5,239 | |||||||||||
Payroll taxes and other employment costs | 1,208 | 1,377 | 1,036 | 2,585 | 2,220 | |||||||||||
Stock-based compensation | 930 | 1,208 | 424 | 2,138 | 1,510 | |||||||||||
Deferred personnel costs | (729 | ) | (556 | ) | (579 | ) | (1,285 | ) | (1,010 | ) | ||||||
Salaries and employee benefit costs | $ | 20,824 | $ | 19,202 | $ | 18,025 | $ | 40,026 | $ | 34,015 | ||||||
Full-time equivalent employees: | ||||||||||||||||
Actual at end of period | 918 | 859 | 862 | 918 | 862 | |||||||||||
Average during the period | 906 | 869 | 844 | 891 | 820 |
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, 2019 | March 31, 2019 | June 30, 2018 | June 30, | |||||||||||||
(Dollars in thousands) | 2019 | 2018 | ||||||||||||||
Depreciation | $ | 1,494 | $ | 1,249 | $ | 1,248 | $ | 2,743 | $ | 2,466 | ||||||
Repairs and maintenance costs | 715 | 770 | 659 | 1,485 | 1,507 | |||||||||||
Net rent expense | 250 | 288 | 235 | 538 | 444 | |||||||||||
Property taxes, utilities and other costs | 673 | 671 | 661 | 1,344 | 1,252 | |||||||||||
Net occupancy and equipment expense | $ | 3,132 | $ | 2,978 | $ | 2,803 | $ | 6,110 | $ | 5,669 |
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, 2019 | March 31, 2019 | June 30, 2018 | June 30, | |||||||||||||
(Dollars in thousands) | 2019 | 2018 | ||||||||||||||
Professional fees | $ | 2,344 | $ | 1,276 | $ | 3,022 | $ | 3,620 | $ | 4,740 | ||||||
Electronic banking expense | 1,693 | 1,577 | 1,407 | 3,270 | 2,857 | |||||||||||
Data processing and software expense | 1,567 | 1,545 | 1,359 | 3,112 | 2,681 | |||||||||||
Amortization of other intangible assets | 824 | 694 | 861 | 1,518 | 1,615 | |||||||||||
Franchise tax expense | 772 | 705 | 614 | 1,477 | 1,258 | |||||||||||
Marketing expense | 490 | 594 | 656 | 1,084 | 981 | |||||||||||
FDIC insurance expense | 381 | 371 | 416 | 752 | 782 | |||||||||||
Foreclosed real estate and other loan expenses | 469 | 255 | 338 | 724 | 550 | |||||||||||
Communication expense | 317 | 278 | 300 | 595 | 644 | |||||||||||
Other non-interest expense | 6,063 | 2,519 | 6,170 | 8,448 | 8,400 |
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, 2019 | March 31, 2019 | June 30, 2018 | June 30, | |||||||||||||
(Dollars in thousands) | 2019 | 2018 | ||||||||||||||
Pre-provision net revenue: | ||||||||||||||||
Income before income taxes | $ | 11,836 | $ | 17,746 | $ | 8,904 | $ | 29,582 | $ | 23,028 | ||||||
Add: provision for loan losses | 626 | — | 1,188 | 363 | 3,171 | |||||||||||
Add: loss on debt extinguishment | — | — | 13 | — | 13 | |||||||||||
Add: net loss on OREO | 24 | 25 | — | 49 | — | |||||||||||
Add: net loss on investment securities | 57 | — | 147 | 27 | 146 | |||||||||||
Add: net loss on other assets | 274 | 157 | 330 | 431 | 251 | |||||||||||
Add: net loss on other transactions | — | — | 76 | — | 76 | |||||||||||
Less: net gain on OREO | — | — | 14 | — | 9 | |||||||||||
Less: recovery of loan losses | — | 263 | — | — | — | |||||||||||
Less: net gain on investment securities | — | 30 | — | — | — | |||||||||||
Less: gain on other transactions | 5 | — | 5 | — | ||||||||||||
Pre-provision net revenue | $ | 12,812 | $ | 17,635 | $ | 10,644 | $ | 30,447 | $ | 26,676 | ||||||
Total average assets | $ | 4,239,779 | $ | 3,985,621 | $ | 3,897,957 | $ | 4,113,403 | $ | 3,748,331 | ||||||
Pre-provision net revenue to total average assets (a) | 1.21 | % | 1.79 | % | 1.10 | % | 1.49 | % | 1.44 | % | ||||||
(a) Presented on an annualized basis. |
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, 2019 | March 31, 2019 | June 30, 2018 | June 30, | |||||||||||||
(Dollars in thousands) | 2019 | 2018 | ||||||||||||||
Core non-interest expense: | ||||||||||||||||
Total non-interest expense | $ | 38,876 | $ | 31,860 | $ | 35,971 | $ | 70,736 | $ | 64,192 | ||||||
Less: acquisition-related expenses | 6,770 | 253 | 6,056 | 7,023 | 6,205 | |||||||||||
Core non-interest expense | $ | 32,106 | $ | 31,607 | $ | 29,915 | $ | 63,713 | $ | 57,987 |
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, 2019 | March 31, 2019 | June 30, 2018 | June 30, | |||||||||||||
(Dollars in thousands) | 2019 | 2018 | ||||||||||||||
Efficiency ratio: | ||||||||||||||||
Total non-interest expense | $ | 38,876 | $ | 31,860 | $ | 35,971 | $ | 70,736 | $ | 64,192 | ||||||
Less: amortization of other intangible assets | 824 | 694 | 861 | 1,518 | 1,615 | |||||||||||
Adjusted total non-interest expense | $ | 38,052 | $ | 31,166 | $ | 35,110 | $ | 69,218 | $ | 62,577 | ||||||
Total non-interest income | $ | 15,289 | $ | 15,429 | $ | 13,255 | $ | 30,718 | $ | 28,224 | ||||||
Less: net (loss) gain on investment securities | (57 | ) | 30 | (147 | ) | (27 | ) | (146 | ) | |||||||
Less: net loss on asset disposals and other transactions | (293 | ) | (182 | ) | (405 | ) | (475 | ) | (331 | ) | ||||||
Total non-interest income excluding net gains and losses | $ | 15,639 | $ | 15,581 | $ | 13,807 | $ | 31,220 | $ | 28,701 | ||||||
Net interest income | $ | 36,049 | $ | 33,914 | $ | 32,808 | $ | 69,963 | $ | 62,167 | ||||||
Add: fully tax-equivalent adjustment (a) | 267 | 200 | 225 | 467 | 450 | |||||||||||
Net interest income on a fully tax-equivalent basis | $ | 36,316 | $ | 34,114 | $ | 33,033 | $ | 70,430 | $ | 62,617 | ||||||
Adjusted revenue | $ | 51,955 | $ | 49,695 | $ | 46,840 | $ | 101,650 | $ | 91,318 | ||||||
Efficiency ratio | 73.24 | % | 62.71 | % | 74.96 | % | 68.09 | % | 68.53 | % | ||||||
Efficiency ratio adjusted for non-core items: | ||||||||||||||||
Core non-interest expense | $ | 32,106 | $ | 31,607 | $ | 29,915 | $ | 63,713 | $ | 57,987 | ||||||
Less: amortization of other intangible assets | 824 | 694 | 861 | 1,518 | 1,615 | |||||||||||
Adjusted core non-interest expense | $ | 31,282 | $ | 30,913 | $ | 29,054 | $ | 62,195 | $ | 56,372 | ||||||
Total non-interest income excluding net gains and losses | $ | 15,639 | $ | 15,581 | $ | 13,807 | $ | 31,220 | $ | 28,701 | ||||||
Net interest income on a fully tax-equivalent basis | 36,316 | 34,114 | 33,033 | 70,430 | 62,617 | |||||||||||
Adjusted revenue | $ | 51,955 | $ | 49,695 | $ | 46,840 | $ | 101,650 | $ | 91,318 | ||||||
Efficiency ratio adjusted for non-core items | 60.21 | % | 62.21 | % | 62.03 | % | 61.19 | % | 61.73 | % |
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, 2019 | March 31, 2019 | June 30, 2018 | June 30, | |||||||||||||
(Dollars in thousands) | 2019 | 2018 | ||||||||||||||
Annualized net income adjusted for non-core items: | ||||||||||||||||
Net income | $ | 9,598 | $ | 14,369 | $ | 7,892 | $ | 23,967 | $ | 19,633 | ||||||
Add: net loss on investment securities | 57 | — | 147 | 27 | 146 | |||||||||||
Less: tax effect of net loss on investment securities (a) | 12 | — | 31 | 6 | 31 | |||||||||||
Less: net gain on investment securities | — | 30 | — | — | — | |||||||||||
Add: tax effect of net gain on investment securities (a) | — | 6 | — | — | — | |||||||||||
Add: net loss on asset disposals and other transactions | 293 | 182 | 405 | 475 | 331 | |||||||||||
Less: tax effect of net loss on asset disposals and other transactions (a) | 62 | 38 | 85 | 100 | 70 | |||||||||||
Add: acquisition-related expenses | 6,770 | 253 | 6,056 | 7,023 | 6,205 | |||||||||||
Less: tax effect of acquisition-related expenses (a) | 1,422 | 53 | 1,272 | 1,475 | 1,303 | |||||||||||
Net income adjusted for non-core items | $ | 15,222 | $ | 14,689 | $ | 13,112 | $ | 29,911 | $ | 24,911 | ||||||
Days in the quarter | 91 | 90 | 91 | 181 | 181 | |||||||||||
Days in the year | 365 | 365 | 365 | 365 | 365 | |||||||||||
Annualized net income | $ | 38,497 | $ | 58,274 | $ | 31,655 | $ | 48,331 | $ | 39,591 | ||||||
Annualized net income adjusted for non-core items | $ | 61,055 | $ | 59,572 | $ | 52,592 | $ | 60,318 | $ | 50,235 | ||||||
Return on average assets: | ||||||||||||||||
Annualized net income | $ | 38,497 | $ | 58,274 | $ | 31,655 | $ | 48,331 | $ | 39,591 | ||||||
Total average assets | 4,239,779 | 3,985,621 | 3,897,957 | 4,113,403 | 3,748,331 | |||||||||||
Return on average assets | 0.91 | % | 1.46 | % | 0.81 | % | 1.17 | % | 1.06 | % | ||||||
Return on average assets adjusted for non-core items: | ||||||||||||||||
Annualized net income adjusted for non-core items | $ | 61,055 | $ | 59,572 | $ | 52,592 | $ | 60,318 | $ | 50,235 | ||||||
Total average assets | 4,239,779 | 3,985,621 | 3,897,957 | 4,113,403 | 3,748,331 | |||||||||||
Return on average assets adjusted for non-core items | 1.44 | % | 1.49 | % | 1.35 | % | 1.47 | % | 1.34 | % |
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, 2019 | March 31, 2019 | June 30, 2018 | June 30, | |||||||||||||
(Dollars in thousands) | 2019 | 2018 | ||||||||||||||
Annualized net income excluding amortization of other intangible assets: | ||||||||||||||||
Net income | $ | 9,598 | $ | 14,369 | $ | 7,892 | $ | 23,967 | $ | 19,633 | ||||||
Add: amortization of other intangible assets | 824 | 694 | 861 | 1,518 | 1,615 | |||||||||||
Less: tax effect of amortization of other intangible assets (a) | 173 | 146 | 181 | 319 | 339 | |||||||||||
Net income excluding amortization of other intangible assets | $ | 10,249 | $ | 14,917 | $ | 8,572 | $ | 25,166 | $ | 20,909 | ||||||
Days in the quarter | 91 | 90 | 91 | 181 | 181 | |||||||||||
Days in the year | 365 | 365 | 365 | 365 | 365 | |||||||||||
Annualized net income | $ | 38,497 | $ | 58,274 | $ | 31,655 | $ | 48,331 | $ | 39,591 | ||||||
Annualized net income excluding amortization of other intangible assets | $ | 41,109 | $ | 60,497 | $ | 34,382 | $ | 50,749 | $ | 42,165 | ||||||
Average tangible equity: | ||||||||||||||||
Total average stockholders' equity | $ | 564,992 | $ | 524,196 | $ | 489,876 | $ | 544,706 | $ | 472,152 | ||||||
Less: average goodwill and other intangible assets | 175,169 | 161,673 | 161,600 | 168,458 | 152,943 | |||||||||||
Average tangible equity | $ | 389,823 | $ | 362,523 | $ | 328,276 | $ | 376,248 | $ | 319,209 | ||||||
Return on average stockholders' equity ratio: | ||||||||||||||||
Annualized net income | $ | 38,497 | $ | 58,274 | $ | 31,655 | $ | 48,331 | $ | 39,591 | ||||||
Average stockholders' equity | $ | 564,992 | $ | 524,196 | $ | 489,876 | $ | 544,706 | $ | 472,152 | ||||||
Return on average stockholders' equity | 6.81 | % | 11.12 | % | 6.46 | % | 8.87 | % | 8.39 | % | ||||||
Return on average tangible equity ratio: | ||||||||||||||||
Annualized net income excluding amortization of other intangible assets | $ | 41,109 | $ | 60,497 | $ | 34,382 | $ | 50,749 | $ | 42,165 | ||||||
Average tangible equity | $ | 389,823 | $ | 362,523 | $ | 328,276 | $ | 376,248 | $ | 319,209 | ||||||
Return on average tangible equity | 10.55 | % | 16.69 | % | 10.47 | % | 13.49 | % | 13.21 | % |
(Dollars in thousands) | June 30, 2019 | March 31, 2019 | December 31, 2018 | September 30, 2018 | June 30, 2018 | ||||||||||
Available-for-sale securities, at fair value: | |||||||||||||||
Obligations of: | |||||||||||||||
U.S. Treasury and government agencies | $ | — | $ | — | $ | — | $ | — | $ | 43 | |||||
U.S. government sponsored agencies | 19,051 | — | — | — | — | ||||||||||
States and political subdivisions | 125,418 | 84,827 | 88,587 | 93,790 | 96,913 | ||||||||||
Residential mortgage-backed securities | 748,132 | 706,976 | 692,608 | 688,656 | 688,002 | ||||||||||
Commercial mortgage-backed securities | 22,664 | 6,649 | 6,707 | 6,713 | 6,799 | ||||||||||
Bank-issued trust preferred securities | 4,099 | 4,118 | 3,989 | 4,166 | 4,167 | ||||||||||
Total fair value | $ | 919,364 | $ | 802,570 | $ | 791,891 | $ | 793,325 | $ | 795,924 | |||||
Total amortized cost | $ | 910,431 | $ | 806,641 | $ | 804,655 | $ | 819,431 | $ | 816,217 | |||||
Net unrealized gain (loss) | $ | 8,933 | $ | (4,071 | ) | $ | (12,764 | ) | $ | (26,106 | ) | $ | (20,293 | ) | |
Held-to-maturity securities, at amortized cost: | |||||||||||||||
Obligations of: | |||||||||||||||
States and political subdivisions | $ | 4,398 | $ | 4,401 | $ | 4,403 | $ | 4,451 | $ | 4,530 | |||||
Residential mortgage-backed securities | 23,335 | 28,348 | 29,044 | 29,765 | 30,668 | ||||||||||
Commercial mortgage-backed securities | 7,106 | 2,857 | 3,514 | 3,574 | 3,636 | ||||||||||
Total amortized cost | $ | 34,839 | $ | 35,606 | $ | 36,961 | $ | 37,790 | $ | 38,834 | |||||
Other investment securities | $ | 43,508 | $ | 41,449 | $ | 42,985 | $ | 43,044 | $ | 42,007 | |||||
Total investment securities: | |||||||||||||||
Amortized cost | $ | 988,778 | $ | 883,696 | $ | 884,601 | $ | 900,265 | $ | 897,058 | |||||
Carrying value | $ | 997,711 | $ | 879,625 | $ | 871,837 | $ | 874,159 | $ | 876,765 |
(Dollars in thousands) | June 30, 2019 | March 31, 2019 | December 31, 2018 | September 30, 2018 | June 30, 2018 | ||||||||||
Gross originated loans: | |||||||||||||||
Commercial real estate, construction | $ | 102,904 | $ | 116,992 | $ | 124,013 | $ | 103,562 | $ | 107,255 | |||||
Commercial real estate, other | 641,061 | 630,679 | 632,200 | 630,720 | 650,512 | ||||||||||
Commercial real estate | 743,965 | 747,671 | 756,213 | 734,282 | 757,767 | ||||||||||
Commercial and industrial | 548,460 | 558,070 | 530,207 | 510,591 | 471,270 | ||||||||||
Residential real estate | 299,173 | 297,667 | 296,860 | 299,768 | 299,934 | ||||||||||
Home equity lines of credit | 90,374 | 90,831 | 93,326 | 92,892 | 89,957 | ||||||||||
Consumer, indirect | 419,595 | 410,172 | 407,167 | 396,701 | 373,384 | ||||||||||
Consumer, direct | 72,209 | 69,710 | 71,674 | 72,601 | 71,545 | ||||||||||
Consumer | 491,804 | 479,882 | 478,841 | 469,302 | 444,929 | ||||||||||
Deposit account overdrafts | 676 | 518 | 583 | 649 | 860 | ||||||||||
Total originated loans | $ | 2,174,452 | $ | 2,174,639 | $ | 2,156,030 | $ | 2,107,484 | $ | 2,064,717 | |||||
Gross acquired loans (a): | |||||||||||||||
Commercial real estate, construction | $ | 6,775 | $ | 7,966 | $ | 12,404 | $ | 13,050 | $ | 14,780 | |||||
Commercial real estate, other | 201,909 | 171,785 | 184,711 | 191,993 | 207,195 | ||||||||||
Commercial real estate | 208,684 | 179,751 | 197,115 | 205,043 | 221,975 | ||||||||||
Commercial and industrial | 51,506 | 34,837 | 35,537 | 41,188 | 40,938 | ||||||||||
Residential real estate | 348,439 | 308,137 | 296,937 | 308,178 | 309,629 | ||||||||||
Home equity lines of credit | 41,262 | 38,084 | 40,653 | 42,961 | 45,933 | ||||||||||
Consumer, indirect | 90 | 111 | 136 | 161 | 198 | ||||||||||
Consumer, direct | 9,100 | 2,021 | 2,370 | 2,712 | 3,101 | ||||||||||
Consumer | 9,190 | 2,132 | 2,506 | 2,873 | 3,299 | ||||||||||
Total acquired loans | $ | 659,081 | $ | 562,941 | $ | 572,748 | $ | 600,243 | $ | 621,774 | |||||
Total loans | $ | 2,833,533 | $ | 2,737,580 | $ | 2,728,778 | $ | 2,707,727 | $ | 2,686,491 | |||||
Average total loans | $ | 2,830,558 | $ | 2,734,592 | $ | 2,718,620 | $ | 2,717,200 | $ | 2,627,777 | |||||
Average allowance for loan losses | (21,311 | ) | (20,406 | ) | (20,079 | ) | (19,584 | ) | (19,071 | ) | |||||
Average loans, net of average allowance for loan losses | $ | 2,809,247 | $ | 2,714,186 | $ | 2,698,541 | $ | 2,697,616 | $ | 2,608,706 | |||||
Percent of loans to total loans: | |||||||||||||||
Commercial real estate, construction | 3.9 | % | 4.6 | % | 5.1 | % | 4.3 | % | 4.5 | % | |||||
Commercial real estate, other | 29.7 | % | 29.3 | % | 29.9 | % | 30.4 | % | 31.9 | % | |||||
Commercial real estate | 33.6 | % | 33.9 | % | 35.0 | % | 34.7 | % | 36.4 | % | |||||
Commercial and industrial | 21.2 | % | 21.7 | % | 20.7 | % | 20.3 | % | 19.1 | % | |||||
Residential real estate | 22.9 | % | 22.1 | % | 21.8 | % | 22.5 | % | 22.7 | % | |||||
Home equity lines of credit | 4.6 | % | 4.7 | % | 4.9 | % | 5.0 | % | 5.1 | % | |||||
Consumer, indirect | 14.8 | % | 15.0 | % | 14.9 | % | 14.7 | % | 13.9 | % | |||||
Consumer, direct | 2.9 | % | 2.6 | % | 2.7 | % | 2.8 | % | 2.8 | % | |||||
Consumer | 17.7 | % | 17.6 | % | 17.6 | % | 17.5 | % | 16.7 | % | |||||
Deposit account overdrafts (b) | NM | NM | NM | NM | NM | ||||||||||
Total percentage | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||||
Residential real estate loans being serviced for others | $ | 473,443 | $ | 464,575 | $ | 461,256 | $ | 458,999 | $ | 451,391 |
(a) | Includes all loans acquired, and related loan discount recorded as part of acquisition accounting, in 2012 or thereafter. Loans that were acquired and subsequently re-underwritten are reported as originated upon execution of such credit actions (for example, renewals and increases in lines of credit). |
(b) | Not meaningful. |
(Dollars in thousands) | Outstanding Balance | Loan Commitments | Total Exposure | % of Total | |||||||
Commercial real estate, construction: | |||||||||||
Assisted living facilities and nursing homes | $ | 17,745 | $ | 29,268 | $ | 47,013 | 23.7 | % | |||
Apartment complexes | 15,767 | 14,818 | 30,585 | 15.4 | % | ||||||
Educational services | 8,538 | 19,895 | 28,433 | 14.3 | % | ||||||
Office buildings | 15,775 | 7,702 | 23,477 | 11.8 | % | ||||||
Mixed used facility | 17,729 | 4,902 | 22,631 | 11.4 | % | ||||||
Industrial | 8,271 | — | 8,271 | 4.2 | % | ||||||
Child care | 5,930 | 95 | 6,025 | 3.0 | % | ||||||
Retail | 1,797 | 4,035 | 5,832 | 2.9 | % | ||||||
Warehouse | 4,280 | 1,333 | 5,613 | 2.9 | % | ||||||
Residential property | 2,465 | 2,714 | 5,179 | 2.6 | % | ||||||
Other (a) | 11,382 | 4,057 | 15,439 | 7.8 | % | ||||||
Total commercial real estate, construction | $ | 109,679 | $ | 88,819 | $ | 198,498 | 100.0 | % |
(a) | All other outstanding balances are less than 2% of the total loan portfolio. |
(Dollars in thousands) | Outstanding Balance | Loan Commitments | Total Exposure | % of Total | |||||||
Commercial real estate, other: | |||||||||||
Office buildings and complexes: | |||||||||||
Owner occupied | $ | 73,617 | $ | 1,822 | $ | 75,439 | 8.6 | % | |||
Non-owner occupied | 52,739 | 4,591 | 57,330 | 6.5 | % | ||||||
Total office buildings and complexes | 126,356 | 6,413 | 132,769 | 15.1 | % | ||||||
Mixed-use facilities: | |||||||||||
Owner occupied | 36,567 | 864 | 37,431 | 4.3 | % | ||||||
Non-owner occupied | 71,527 | 785 | 72,312 | 8.2 | % | ||||||
Total mixed-use facilities | 108,094 | 1,649 | 109,743 | 12.5 | % | ||||||
Apartment complexes | 77,535 | 849 | 78,384 | 8.9 | % | ||||||
Retail facilities: | |||||||||||
Owner occupied | 29,202 | 714 | 29,916 | 3.5 | % | ||||||
Non-owner occupied | 39,602 | 98 | 39,700 | 4.5 | % | ||||||
Total retail facilities | 68,804 | 812 | 69,616 | 8.0 | % | ||||||
Industrial facilities: | |||||||||||
Owner occupied | 46,056 | 127 | 46,183 | 5.2 | % | ||||||
Non-owner occupied | 16,782 | 1,088 | 17,870 | 2.0 | % | ||||||
Total light industrial facilities | 62,838 | 1,215 | 64,053 | 7.2 | % | ||||||
Warehouse facilities | 56,048 | 4,898 | 60,946 | 6.9 | % | ||||||
Lodging and lodging related | 30,901 | — | 30,901 | 3.5 | % | ||||||
Assisted living facilities and nursing homes | 30,915 | 282 | 31,197 | 3.5 | % | ||||||
Land only | 16,383 | 2,177 | 18,560 | 2.1 | % | ||||||
Other (a) | 265,096 | 18,693 | 283,788 | 32.3 | % | ||||||
Total commercial real estate, other | $ | 842,970 | $ | 36,988 | $ | 879,957 | 100.0 | % |
(a) | All other outstanding balances are less than 2% of the total loan portfolio. |
(Dollars in thousands) | June 30, 2019 | March 31, 2019 | December 31, 2018 | September 30, 2018 | June 30, 2018 | ||||||||||
Commercial real estate | $ | 8,245 | $ | 8,297 | $ | 8,003 | $ | 7,966 | $ | 8,271 | |||||
Commercial and industrial | 7,197 | 6,743 | 6,178 | 6,138 | 5,365 | ||||||||||
Total commercial | 15,442 | 15,040 | 14,181 | 14,104 | 13,636 | ||||||||||
Residential real estate | 1,184 | 1,213 | 1,214 | 999 | 1,005 | ||||||||||
Home equity lines of credit | 598 | 608 | 618 | 708 | 618 | ||||||||||
Consumer, indirect | 3,172 | 3,133 | 3,214 | 3,423 | 3,339 | ||||||||||
Consumer, direct | 342 | 351 | 351 | 395 | 465 | ||||||||||
Consumer | 3,514 | 3,484 | 3,565 | 3,818 | 3,804 | ||||||||||
Deposit account overdrafts | 86 | 61 | 81 | 95 | 95 | ||||||||||
Originated allowance for loan losses | 20,824 | 20,406 | 19,659 | 19,724 | 19,158 | ||||||||||
Acquired allowance for loan losses | 533 | 533 | 536 | 155 | 108 | ||||||||||
Allowance for loan losses | $ | 21,357 | $ | 20,939 | $ | 20,195 | $ | 19,879 | $ | 19,266 | |||||
As a percent of total loans | 0.75 | % | 0.76 | % | 0.74 | % | 0.73 | % | 0.72 | % |
Three Months Ended | |||||||||||||||
(Dollars in thousands) | June 30, 2019 | March 31, 2019 | December 31, 2018 | September 30, 2018 | June 30, 2018 | ||||||||||
Gross charge-offs: | |||||||||||||||
Commercial real estate, other | $ | 43 | $ | 113 | $ | — | $ | — | $ | 7 | |||||
Commercial and industrial | — | 63 | — | — | 7 | ||||||||||
Residential real estate | 67 | 109 | 64 | 66 | 82 | ||||||||||
Home equity lines of credit | — | 9 | 40 | 10 | 20 | ||||||||||
Consumer, indirect | 346 | 473 | 548 | 488 | 550 | ||||||||||
Consumer, direct | 33 | 63 | 61 | 78 | 109 | ||||||||||
Consumer | 379 | 536 | 609 | 566 | 659 | ||||||||||
Deposit account overdrafts | 176 | 173 | 234 | 311 | 215 | ||||||||||
Total gross charge-offs | $ | 665 | $ | 1,003 | $ | 947 | $ | 953 | $ | 990 | |||||
Recoveries: | |||||||||||||||
Commercial real estate, other | $ | 2 | $ | 10 | $ | 2 | $ | 15 | $ | 28 | |||||
Commercial and industrial | 228 | 1,784 | 8 | 10 | — | ||||||||||
Residential real estate | 102 | 31 | 133 | 32 | 41 | ||||||||||
Home equity lines of credit | 1 | 1 | 2 | 3 | 2 | ||||||||||
Consumer, indirect | 47 | 115 | 71 | 131 | 138 | ||||||||||
Consumer, direct | 27 | 13 | 25 | 31 | 15 | ||||||||||
Consumer | 74 | 128 | 96 | 162 | 153 | ||||||||||
Deposit account overdrafts | 50 | 56 | 45 | 44 | 46 | ||||||||||
Total recoveries | $ | 457 | $ | 2,010 | $ | 286 | $ | 266 | $ | 270 | |||||
Net charge-offs (recoveries): | |||||||||||||||
Commercial real estate, other | $ | 41 | $ | 103 | $ | (2 | ) | $ | (15 | ) | $ | (21 | ) | ||
Commercial and industrial | (228 | ) | (1,721 | ) | (8 | ) | (10 | ) | 7 | ||||||
Residential real estate | (35 | ) | 78 | (69 | ) | 34 | 41 | ||||||||
Home equity lines of credit | (1 | ) | 8 | 38 | 7 | 18 | |||||||||
Consumer, indirect | 299 | 358 | 477 | 357 | 412 | ||||||||||
Consumer, direct | 6 | 50 | 36 | 47 | 94 | ||||||||||
Consumer | 305 | 408 | 513 | 404 | 506 | ||||||||||
Deposit account overdrafts | 126 | 117 | 189 | 267 | 169 | ||||||||||
Total net charge-offs (recoveries) | $ | 208 | $ | (1,007 | ) | $ | 661 | $ | 687 | $ | 720 | ||||
Ratio of net charge-offs to average total loans (annualized): | |||||||||||||||
Commercial real estate | 0.01 | % | 0.02 | % | — | % | — | % | — | % | |||||
Commercial and industrial | (0.03 | )% | (0.26 | )% | — | % | — | % | — | % | |||||
Residential real estate | — | % | 0.01 | % | (0.01 | )% | — | % | 0.01 | % | |||||
Home equity lines of credit | — | % | — | % | — | % | — | % | — | % | |||||
Consumer, indirect | 0.03 | % | 0.05 | % | 0.07 | % | 0.05 | % | 0.06 | % | |||||
Consumer, other | — | % | 0.01 | % | 0.01 | % | 0.01 | % | 0.01 | % | |||||
Consumer | 0.03 | % | 0.06 | % | 0.08 | % | 0.06 | % | 0.07 | % | |||||
Deposit account overdrafts | 0.02 | % | 0.02 | % | 0.03 | % | 0.04 | % | 0.03 | % | |||||
Total | 0.03 | % | (0.15 | )% | 0.10 | % | 0.10 | % | 0.11 | % |
(Dollars in thousands) | June 30, 2019 | March 31, 2019 | December 31, 2018 | September 30, 2018 | June 30, 2018 | ||||||||||
Loans 90+ days past due and accruing: | |||||||||||||||
Commercial real estate, construction | $ | 230 | $ | — | $ | — | $ | 401 | $ | — | |||||
Commercial real estate, other | 557 | 15 | 801 | 60 | 615 | ||||||||||
Commercial real estate | 787 | 15 | 801 | 461 | 615 | ||||||||||
Commercial and industrial | 261 | 50 | 18 | — | — | ||||||||||
Residential real estate | 2,291 | 963 | 1,430 | 1,338 | 1,308 | ||||||||||
Home equity lines of credit | 53 | 42 | 7 | 84 | 6 | ||||||||||
Consumer, indirect | — | 4 | — | 2 | — | ||||||||||
Consumer, direct | 57 | — | — | — | 46 | ||||||||||
Consumer | 57 | 4 | — | 2 | 46 | ||||||||||
Total loans 90+ days past due and accruing | $ | 3,449 | $ | 1,074 | $ | 2,256 | $ | 1,885 | $ | 1,975 | |||||
Nonaccrual loans: | |||||||||||||||
Commercial real estate, construction | $ | 688 | $ | 703 | $ | 710 | $ | 725 | $ | 725 | |||||
Commercial real estate, other | 6,427 | 6,459 | 6,730 | 6,751 | 6,422 | ||||||||||
Commercial real estate | 7,115 | 7,162 | 7,440 | 7,476 | 7,147 | ||||||||||
Commercial and industrial | 1,748 | 1,719 | 1,304 | 939 | 1,265 | ||||||||||
Residential real estate | 3,868 | 4,479 | 4,075 | 3,725 | 3,770 | ||||||||||
Home equity lines of credit | 1,001 | 1,065 | 1,023 | 796 | 681 | ||||||||||
Consumer, indirect | 383 | 440 | 324 | 286 | 221 | ||||||||||
Consumer, direct | 13 | 17 | 56 | 14 | 12 | ||||||||||
Consumer | 396 | 457 | 380 | 300 | 233 | ||||||||||
Total nonaccrual loans | $ | 14,128 | $ | 14,882 | $ | 14,222 | $ | 13,236 | $ | 13,096 | |||||
Nonaccrual troubled debt restructurings ("TDRs"): | |||||||||||||||
Commercial real estate, other | $ | 122 | $ | 127 | $ | 154 | $ | 186 | $ | 236 | |||||
Commercial and industrial | 332 | 332 | 405 | 430 | 436 | ||||||||||
Residential real estate | 1,664 | 1,389 | 1,951 | 2,087 | 2,132 | ||||||||||
Home equity lines of credit | 193 | 195 | 210 | 160 | 71 | ||||||||||
Consumer, indirect | 152 | 159 | 156 | 119 | 93 | ||||||||||
Consumer, direct | — | 5 | — | 17 | 5 | ||||||||||
Consumer | 152 | 164 | 156 | 136 | 98 | ||||||||||
Total nonaccrual TDRs | $ | 2,463 | $ | 2,207 | $ | 2,876 | $ | 2,999 | $ | 2,973 | |||||
Total nonperforming loans ("NPLs") | $ | 20,040 | $ | 18,163 | $ | 19,354 | $ | 18,120 | $ | 18,044 | |||||
OREO: | |||||||||||||||
Residential | $ | 123 | $ | 81 | $ | 94 | $ | 106 | $ | 63 | |||||
Total OREO | $ | 123 | $ | 81 | $ | 94 | $ | 106 | $ | 63 | |||||
Total nonperforming assets ("NPAs") | $ | 20,163 | $ | 18,244 | $ | 19,448 | $ | 18,226 | $ | 18,107 | |||||
Criticized loans (a) | $ | 97,016 | $ | 89,812 | $ | 114,188 | $ | 118,703 | $ | 120,809 | |||||
Classified loans (b) | 63,048 | 47,327 | 43,818 | 49,058 | 55,596 |
(Dollars in thousands) | June 30, 2019 | March 31, 2019 | December 31, 2018 | September 30, 2018 | June 30, 2018 | |||||
Asset Quality Ratios: | ||||||||||
NPLs as a percent of total loans (c)(d) | 0.71 | % | 0.66 | % | 0.71 | % | 0.67 | % | 0.67 | % |
NPAs as a percent of total assets (c)(d) | 0.47 | % | 0.45 | % | 0.49 | % | 0.46 | % | 0.46 | % |
NPAs as a percent of total loans and OREO (c)(d) | 0.71 | % | 0.67 | % | 0.71 | % | 0.67 | % | 0.67 | % |
Allowance for loan losses as a percent of NPLs (c) | 106.57 | % | 115.28 | % | 104.35 | % | 109.71 | % | 106.77 | % |
Criticized loans as a percent of total loans (a)(c) | 3.42 | % | 3.28 | % | 4.18 | % | 4.38 | % | 4.50 | % |
Classified loans as a percent of total loans (b)(c) | 2.23 | % | 1.73 | % | 1.61 | % | 1.81 | % | 2.07 | % |
(Dollars in thousands) | June 30, 2019 | March 31, 2019 | December 31, 2018 | September 30, 2018 | June 30, 2018 | ||||||||||
Non-interest-bearing deposits (a) | $ | 643,058 | $ | 628,464 | $ | 607,877 | $ | 617,447 | $ | 585,861 | |||||
Interest-bearing deposits: | |||||||||||||||
Interest-bearing demand accounts (a) | 610,464 | 572,316 | 573,702 | 547,172 | 570,359 | ||||||||||
Savings accounts | 526,746 | 477,824 | 468,500 | 473,240 | 480,615 | ||||||||||
Retail certificates of deposit ("CDs") | 497,221 | 404,186 | 394,335 | 402,309 | 406,214 | ||||||||||
Money market deposit accounts | 428,213 | 403,642 | 379,878 | 391,377 | 389,893 | ||||||||||
Governmental deposit accounts | 331,754 | 363,636 | 267,319 | 344,320 | 305,255 | ||||||||||
Brokered CDs | 326,157 | 287,345 | 263,854 | 265,258 | 211,062 | ||||||||||
Total interest-bearing deposits | 2,720,555 | 2,508,949 | 2,347,588 | 2,423,676 | 2,363,398 | ||||||||||
Total deposits | $ | 3,363,613 | $ | 3,137,413 | $ | 2,955,465 | $ | 3,041,123 | $ | 2,949,259 |
(a) | The sum of amounts presented is considered total demand deposits. |
(Dollars in thousands) | June 30, 2019 | March 31, 2019 | December 31, 2018 | September 30, 2018 | June 30, 2018 | ||||||||||
Short-term borrowings: | |||||||||||||||
FHLB overnight borrowings | $ | — | $ | 24,000 | $ | 165,000 | $ | 102,000 | $ | 173,000 | |||||
FHLB 90-day advances | 117,200 | 110,000 | 110,000 | 100,000 | 13,000 | ||||||||||
Current portion of long-term FHLB advances | 23,129 | 13,188 | 30,000 | 30,000 | 98,566 | ||||||||||
Retail repurchase agreements | 46,128 | 44,175 | 51,202 | 64,840 | 76,177 | ||||||||||
Unamortized debt issuance cost (a) | — | — | (4 | ) | (10 | ) | (16 | ) | |||||||
Total short-term borrowings | $ | 186,457 | $ | 191,363 | $ | 356,198 | $ | 296,830 | $ | 360,727 | |||||
Long-term borrowings: | |||||||||||||||
FHLB advances | $ | 78,324 | $ | 98,670 | $ | 102,361 | $ | 103,860 | $ | 105,890 | |||||
Junior subordinated debt securities | 7,367 | 7,325 | 7,283 | 7,239 | 7,195 | ||||||||||
Total long-term borrowings | $ | 85,691 | $ | 105,995 | $ | 109,644 | $ | 111,099 | $ | 113,085 | |||||
Total borrowed funds | $ | 272,148 | $ | 297,358 | $ | 465,842 | $ | 407,929 | $ | 473,812 |
(a) | Unamortized debt issuance cost is related to the cost associated with the Credit Agreement with Raymond James Bank, N.A. which was a short-term obligation as of March 31, 2019. |
(Dollars in thousands) | June 30, 2019 | March 31, 2019 | December 31, 2018 | September 30, 2018 | June 30, 2018 | ||||||||||
Capital Amounts: | |||||||||||||||
Common Equity Tier 1 | $ | 410,979 | $ | 389,393 | $ | 378,855 | $ | 367,537 | $ | 358,987 | |||||
Tier 1 | 418,347 | 396,719 | 386,138 | 374,776 | 366,182 | ||||||||||
Total (Tier 1 and Tier 2) | 439,704 | 417,657 | 406,333 | 394,655 | 385,448 | ||||||||||
Net risk-weighted assets | $ | 2,903,387 | $ | 2,788,934 | $ | 2,782,995 | $ | 2,764,951 | $ | 2,755,112 | |||||
Capital Ratios: | |||||||||||||||
Common Equity Tier 1 | 14.16 | % | 13.96 | % | 13.61 | % | 13.29 | % | 13.03 | % | |||||
Tier 1 | 14.41 | % | 14.22 | % | 13.87 | % | 13.55 | % | 13.29 | % | |||||
Total (Tier 1 and Tier 2) | 15.14 | % | 14.98 | % | 14.60 | % | 14.27 | % | 13.99 | % | |||||
Leverage ratio | 10.26 | % | 10.31 | % | 9.99 | % | 9.69 | % | 9.73 | % |
(Dollars in thousands) | June 30, 2019 | March 31, 2019 | December 31, 2018 | September 30, 2018 | June 30, 2018 | ||||||||||
Tangible equity: | |||||||||||||||
Total stockholders' equity | $ | 579,022 | $ | 535,121 | $ | 520,140 | $ | 504,290 | $ | 499,339 | |||||
Less: goodwill and other intangible assets | 176,763 | 161,242 | 162,085 | 163,401 | 163,953 | ||||||||||
Tangible equity | $ | 402,259 | $ | 373,879 | $ | 358,055 | $ | 340,889 | $ | 335,386 | |||||
Tangible assets: | |||||||||||||||
Total assets | $ | 4,276,376 | $ | 4,017,119 | $ | 3,991,454 | $ | 4,003,089 | $ | 3,972,091 | |||||
Less: goodwill and other intangible assets | 176,763 | 161,242 | 162,085 | 163,401 | 163,953 | ||||||||||
Tangible assets | $ | 4,099,613 | $ | 3,855,877 | $ | 3,829,369 | $ | 3,839,688 | $ | 3,808,138 | |||||
Tangible book value per common share: | |||||||||||||||
Tangible equity | $ | 402,259 | $ | 373,879 | $ | 358,055 | $ | 340,889 | $ | 335,386 | |||||
Common shares outstanding | 20,696,041 | 19,681,692 | 19,565,029 | 19,550,014 | 19,528,952 | ||||||||||
Tangible book value per common share | $ | 19.44 | $ | 19.00 | $ | 18.30 | $ | 17.44 | $ | 17.17 | |||||
Tangible equity to tangible assets ratio: | |||||||||||||||
Tangible equity | $ | 402,259 | $ | 373,879 | $ | 358,055 | $ | 340,889 | $ | 335,386 | |||||
Tangible assets | $ | 4,099,613 | $ | 3,855,877 | $ | 3,829,369 | $ | 3,839,688 | $ | 3,808,138 | |||||
Tangible equity to tangible assets | 9.81 | % | 9.70 | % | 9.35 | % | 8.88 | % | 8.81 | % |
Increase (Decrease) in Interest Rate | Estimated Increase (Decrease) in Net Interest Income | Estimated (Decrease) Increase in Economic Value of Equity | |||||||||||||||||||||||
(in Basis Points) | June 30, 2019 | December 31, 2018 | June 30, 2019 | December 31, 2018 | |||||||||||||||||||||
300 | $ | 13,557 | 10.1 | % | $ | 7,351 | 5.5 | % | $ | (11,969 | ) | (1.1 | )% | $ | (22,088 | ) | (2.1 | )% | |||||||
200 | 11,046 | 8.3 | % | 5,780 | 4.3 | % | 24,680 | 2.2 | % | (7,191 | ) | (0.7 | )% | ||||||||||||
100 | 7,478 | 5.6 | % | 3,588 | 2.7 | % | 25,125 | 2.2 | % | 3,926 | 0.4 | % | |||||||||||||
(100) | (11,962 | ) | (9.0 | )% | (9,075 | ) | (6.8 | )% | (41,465 | ) | (3.7 | )% | (44,512 | ) | (4.2 | )% | |||||||||
(200) | (23,702 | ) | (17.7 | )% | (23,712 | ) | (17.6 | )% | (95,175 | ) | (8.5 | )% | (130,769 | ) | (12.4 | )% |
(Dollars in thousands) | June 30, 2019 | March 31, 2019 | December 31, 2018 | September 30, 2018 | June 30, 2018 | ||||||||||
Home equity lines of credit | $ | 106,456 | $ | 103,343 | $ | 101,265 | $ | 101,651 | $ | 103,975 | |||||
Unadvanced construction loans | 95,266 | 80,916 | 74,734 | 71,836 | 87,477 | ||||||||||
Other loan commitments | 360,872 | 308,103 | 314,271 | 324,059 | 319,519 | ||||||||||
Loan commitments | $ | 562,594 | $ | 492,362 | $ | 490,270 | $ | 497,546 | $ | 510,971 | |||||
Standby letters of credit | $ | 14,658 | $ | 12,371 | $ | 10,214 | $ | 9,979 | $ | 20,354 |
(a) | information required to be disclosed by Peoples in this Quarterly Report on Form 10-Q and other reports Peoples files or submits under the Exchange Act would be accumulated and communicated to Peoples’ management, including its President and Chief Executive Officer and its Executive Vice President, Chief Financial Officer and Treasurer, as appropriate to allow timely decisions regarding required disclosure; |
(b) | information required to be disclosed by Peoples in this Quarterly Report on Form 10-Q and other reports Peoples files or submits under the Exchange Act would be recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms; and |
(c) | Peoples’ disclosure controls and procedures were effective as of the end of the fiscal quarter covered by this Quarterly Report on Form 10-Q. |
Period | (a) Total Number of Common Shares Purchased | (b) Average Price Paid per Common Share | (c) Total Number of Common Shares Purchased as Part of Publicly Announced Plans or Programs (1) | (d) Maximum Number ( or Approximate Dollar Value) of Common Shares that May Yet Be Purchased Under the Plans or Programs (1) | ||||||||
April 1-30, 2019 | — | $ | — | — | $ | 15,049,184 | ||||||
May 1-31, 2019 (2) (3) | 3,728 | 32.60 | — | 15,049,184 | ||||||||
June 1-30, 2019 (2) (3) | 2,724 | 31.23 | — | 15,049,184 | ||||||||
Total | 6,452 | $ | 32.02 | — | $ | 15,049,184 |
(1) | On November 3, 2015, Peoples announced that on that same date, Peoples' Board of Directors authorized a share repurchase program authorizing Peoples to purchase up to $20.0 million of its outstanding common shares. No common shares were purchased under this share repurchase program during the three months ended June 30, 2019. |
(2) | Information reported includes 3,160 common shares and 2,239 common shares withheld to pay income taxes associated with restricted common shares which vested during May and June, respectively. |
(3) | Information reported includes 568 common shares and 485 common shares purchased in open market transactions during May and June, respectively, by Peoples Bank under the Rabbi Trust Agreement. The Rabbi Trust Agreement establishes a rabbi trust that holds assets to provide funds for the payment of the benefits under the Peoples Bancorp Inc. Third Amended and Restated Deferred Compensation Plan for Directors of Peoples Bancorp Inc. and Subsidiaries. |
Exhibit Number | Description | Exhibit Location | ||
Agreement and Plan of Merger, dated as of October 23, 2017, between Peoples Bancorp Inc. and ASB Financial Corp.+ | Included as Annex A to the definitive proxy statement/prospectus which forms a part of the Registration Statement of Peoples Bancorp Inc. ("Peoples") on Form S-4/A (Registration No. 333-222054) | |||
Agreement and Plan of Merger, dated as of October 29, 2018, as amended on December 18, 2018, between Peoples Bancorp Inc. and First Prestonsburg Bancshares Inc.+ | Included as Annex A to the definitive proxy statement/prospectus which forms a part of the Registration Statement of Peoples on Form S-4/A (Registration No. 333-228745) | |||
3.1(a) | Amended Articles of Incorporation of Peoples Bancorp Inc. (as filed with the Ohio Secretary of State on May 3, 1993) P | Incorporated herein by reference to Exhibit 3(a) to Peoples' Registration Statement on Form 8-B filed July 20, 1993 (File No. 0-16772) | ||
Certificate of Amendment to the Amended Articles of Incorporation of Peoples Bancorp Inc. (as filed with the Ohio Secretary of State on April 22, 1994) | Incorporated herein by reference to Exhibit 3.1(b) to Peoples' Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2017 (File No. 0-16772) ("Peoples' September 30, 2017 Form 10-Q") | |||
Certificate of Amendment to the Amended Articles of Incorporation of Peoples Bancorp Inc. (as filed with the Ohio Secretary of State on April 9, 1996) | Incorporated herein by reference to Exhibit 3.1(c) to Peoples' September 30, 2017 Form 10-Q | |||
Certificate of Amendment to the Amended Articles of Incorporation of Peoples Bancorp Inc. (as filed with the Ohio Secretary of State on April 23, 2003) | Incorporated herein by reference to Exhibit 3(a) to Peoples’ Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2003 (File No. 0-16772) (“Peoples’ March 31, 2003 Form 10-Q”) | |||
Certificate of Amendment by Shareholders to the Amended Articles of Incorporation of Peoples Bancorp Inc. (as filed with the Ohio Secretary of State on January 22, 2009) | Incorporated herein by reference to Exhibit 3.1 to Peoples’ Current Report on Form 8-K dated and filed on January 23, 2009 (File No. 0-16772) | |||
Certificate of Amendment by Directors to Articles filed with the Secretary of State of the State of Ohio on January 28, 2009, evidencing adoption of amendments by the Board of Directors of Peoples Bancorp Inc. to Article FOURTH of Amended Articles of Incorporation to establish express terms of Fixed Rate Cumulative Perpetual Preferred Shares, Series A, each without par value, of Peoples Bancorp Inc. | Incorporated herein by reference to Exhibit 3.1 to Peoples’ Current Report on Form 8-K dated and filed on February 2, 2009 (File No. 0-16772) | |||
Amended Articles of Incorporation of Peoples Bancorp Inc. (This document represents the Amended Articles of Incorporation of Peoples Bancorp Inc. in compiled form incorporating all amendments. The compiled document has not been filed with the Ohio Secretary of State.) | Incorporated herein by reference to Exhibit 3.1(g) to Peoples’ Annual Report on Form 10-K for the fiscal year ended December 31, 2008 (File No. 0-16772) | |||
3.2(a) | Code of Regulations of Peoples Bancorp Inc. P | Incorporated herein by reference to Exhibit 3(b) to Peoples’ Registration Statement on Form 8-B filed on July 20, 1993 (File No. 0-16772) | ||
Certified Resolutions Regarding Adoption of Amendments to Sections 1.03, 1.04, 1.05, 1.06, 1.08, 1.10, 2.03(C), 2.07, 2.08, 2.10 and 6.02 of the Code of Regulations of Peoples Bancorp Inc. by shareholders on April 10, 2003 | Incorporated herein by reference to Exhibit 3(c) to Peoples’ March 31, 2003 Form 10-Q | |||
Certificate regarding adoption of amendments to Sections 3.01, 3.03, 3.04, 3.05, 3.06, 3.07, 3.08 and 3.11 of the Code of Regulations of Peoples Bancorp Inc. by shareholders on April 8, 2004 | Incorporated herein by reference to Exhibit 3(a) to Peoples’ Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2004 (File No. 0-16772) | |||
+Schedules and exhibits were omitted pursuant to Item 601(b)(2) of SEC Regulation S-K, as in effect at the time of filing of the Agreement and Plan of Merger. A copy of any omitted schedules or exhibits will be furnished supplementally to the SEC upon request. P Filed the exhibit with the SEC in paper originally and has not been filed with the SEC in electronic format. | ||||
Exhibit Number | Description | Exhibit Location | ||
Certificate regarding adoption of amendments to Sections 2.06, 2.07, 3.01 and 3.04 of Peoples Bancorp Inc.’s Code of Regulations by the shareholders on April 13, 2006 | Incorporated herein by reference to Exhibit 3.1 to Peoples’ Current Report on Form 8-K dated and filed on April 14, 2006 (File No. 0-16772) | |||
Certificate regarding adoption of an amendment to Section 2.01 of Peoples Bancorp Inc.’s Code of Regulations by the shareholders on April 22, 2010 | Incorporated herein by reference to Exhibit 3.2(e) to Peoples’ Quarterly Report on Form 10-Q/A (Amendment No. 1) for the quarterly period ended June 30, 2010 (File No. 0-16772) | |||
Certificate regarding Adoption of Amendment to Division (D) of Section 2.02 of Code of Regulations of Peoples Bancorp Inc. by the Shareholders at the Annual Meeting of Shareholders on April 26, 2018 | Incorporated herein by reference to Exhibit 3.1 to Peoples' Current Report on Form 8-K dated and filed on June 28, 2018 (File No. 0-16772) ("Peoples' June 28, 2018 Form 8-K") | |||
Code of Regulations of Peoples Bancorp Inc. (This document represents the Code of Regulations of Peoples Bancorp Inc. in compiled form incorporating all amendments.) | Incorporated herein by reference to Exhibit 3.2 to Peoples' June 28, 2018 Form 8-K | |||
Loan Agreement, made and entered into as of April 3, 2019, between Peoples Bancorp Inc., as Borrower, and U.S. Bank National Association, as Lender | Incorporated herein by reference to Exhibit 10.1 to Peoples' Current Report on Form 8-K dated and filed on April 9, 2019 (File No. 0-16772) ("Peoples' April 9, 2019 Form 8-K") | |||
Revolving Credit Note issued by Peoples Bancorp Inc. on April 3, 2019 to U.S. Bank National Association in the principal amount of $20,000,000 | Incorporated herein by reference to Exhibit 10.2 to Peoples' April 9, 2019 Form 8-K | |||
Peoples Bancorp Inc. Amended and Restated Nonqualified Deferred Compensation Plan (adopted effective July 11, 2019) | Filed herewith | |||
Rule 13a-14(a)/15d-14(a) Certifications [President and Chief Executive Officer] | Filed herewith | |||
Rule 13a-14(a)/15d-14(a) Certifications [Executive Vice President, Chief Financial Officer and Treasurer] | Filed herewith | |||
Section 1350 Certifications | Furnished herewith | |||
101.INS | XBRL Instance Document | Submitted electronically herewith # | ||
101.SCH | XBRL Taxonomy Extension Schema Document | Submitted electronically herewith # | ||
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | Submitted electronically herewith # | ||
101.LAB | XBRL Taxonomy Extension Label Linkbase Document | Submitted electronically herewith # | ||
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document | Submitted electronically herewith # | ||
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document | Submitted electronically herewith # | ||
# Attached as Exhibit 101 to the Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2019 of Peoples Bancorp Inc. are the following documents formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Balance Sheets (Unaudited) at June 30, 2019 and December 31, 2018; (ii) Consolidated Statements of Income (Unaudited) for the three and six months ended June 30, 2019 and 2018; (iii) Consolidated Statements of Comprehensive Income (Unaudited) for the three and six months ended June 30, 2019 and 2018; (iv) Consolidated Statement of Stockholders' Equity (Unaudited) for the six months ended June 30, 2019; (v) Condensed Consolidated Statements of Cash Flows (Unaudited) for the six months ended March 31, 2019 and 2018; and (vi) Notes to the Unaudited Consolidated Financial Statements. |
PEOPLES BANCORP INC. | |||
Date: | August 1, 2019 | By: /s/ | CHARLES W. SULERZYSKI |
Charles W. Sulerzyski | |||
President and Chief Executive Officer | |||
Date: | August 1, 2019 | By: /s/ | JOHN C. ROGERS |
John C. Rogers | |||
Executive Vice President, | |||
Chief Financial Officer and Treasurer |
2.01 | Account: The bookkeeping account established for each Participant under Section 6.01 of this Plan. |
2.02 | Affiliate: Any entity that, along with the Company, would be considered a single employer under Code §§414(b) and 414(c). |
2.03 | Beneficiary: The person or persons designated by a Participant to receive any portion of such Participant’s benefit under the Qualified Plan that is unpaid at the time of the Participant’s death. If a Participant has not made an effective designation of a Beneficiary or Beneficiaries, the Participant’s Beneficiary will be his or her surviving spouse or, if there is no surviving spouse, the Participant’s estate. |
2.04 | Board: The Board of Directors of the Company. |
2.05 | Cause: With respect to any Participant, “cause” as defined in any employment (or similar) agreement then in effect between the Participant and the Company or any of its Affiliates or, if not defined therein, the occurrence of any of the following: (a) gross negligence or gross neglect of duties; (b) commission of a felony or of a gross misdemeanor involving moral turpitude in connection with the Participant’s employment with the Company or any of its Affiliates; (c) fraud, disloyalty, dishonesty or willful violation of any law, rule or regulation or any significant policy of the Company or any of its Affiliates committed in connection with the Participant’s employment; or (d) issuance of an order for removal of the Participant by any agency which regulates the activities of the Company or any of its Affiliates. Any determination of “Cause” under this Plan shall be made by the Committee in its sole discretion. |
2.06 | Code: The Internal Revenue Code of 1986, as amended. |
2.07 | Committee: The Compensation Committee of the Board or a subcommittee thereof appointed by the Board to administer this Plan pursuant to Article 10.00. |
2.08 | Company: Peoples Bancorp Inc. and its successors. |
2.09 | Compensation: A Participant’s “Compensation” as defined under the Qualified Plan calculated without regard to the compensation limit under Code §401(a)(17); provided, however, that for the 2013 Plan Year, Compensation shall exclude all equity awards. |
2.10 | Deferral Election Form: The form each Eligible Employee and Participant, as the case may be, must complete to defer Compensation under this Plan. |
2.11 | [reserved] |
2.12 | Discretionary Contribution: A contribution made by the Company or any of its Affiliates that is credited to a Participant’s Account in accordance with the terms of Section 4.03 of this Plan. |
2.13 | Distribution Election Form: The form each Eligible Employee and Participant, as the case may be, must complete to designate the form of distribution of his or her Plan Benefit or may complete to change a prior designation as to the form of distribution of his or her Plan Benefit. |
2.14 | Effective Date: This amendment and restatement is effective on July 11, 2019. This Plan was originally effective on July 25, 2013. |
2.15 | Eligible Employee: Each person employed by the Company or any of its Affiliates who (a) is a highly compensated employee or a member of a select group of management (both within the meaning of Title I of ERISA) of the Company or any of its Affiliates, as determined by the Committee in its sole discretion, and (b) is designated as an Eligible Employee by the Committee. The designation of an employee as an Eligible Employee for any particular Plan Year shall not confer upon such employee any right to be designated as an Eligible Employee for any future Plan Year. |
2.16 | ERISA: The Employee Retirement Income Security Act of 1974, as amended. |
2.17 | Participant: An Eligible Employee who becomes a participant in this Plan as described in Article 3.00. |
2.18 | Plan: The Peoples Bancorp Inc. Nonqualified Deferred Compensation Plan, as amended from time to time. |
2.19 | Plan Benefit: The vested portion of a Participant’s Account as of any Valuation Date. |
2.20 | Plan Year: Each calendar year or portion thereof during which this Plan is in effect. |
2.21 | Qualified Plan: The Peoples Bancorp Inc. Retirement Savings Plan, as amended from time to time. |
2.22 | Retirement: A Termination by a Participant, other than due to death, on or after attaining 65 years of age and completing at least 10 years of service with the Company and its Affiliates. |
2.23 | Statutory Limits: The compensation limit under Code §401(a)(17), the limit on maximum annual additions under Code §415(c), and the limit on elective deferrals under Code §402(g). |
2.24 | Termination: A “separation from service” within the meaning of Code §409A and Treasury Regulation §1.409A-1(h). |
2.25 | Unforeseeable Emergency: A severe financial hardship to a Participant within the meaning of Code §409A resulting from: (a) an illness or accident of the Participant or the Participant’s spouse, Beneficiary or dependent (as defined in Code §152, without regard to Code §§152(b)(1), (b)(2) and |
2.26 | Valuation Date: The last day of each calendar month or any other date or dates fixed by the Committee for the valuation and adjustment of an Account. |
3.01 | Commencement of Participation. Subject to Section 3.02 of this Plan, each Eligible Employee shall become a Participant on the date on which the Eligible Employee executes and submits an effective Deferral Election Form. |
3.02 | Loss of Eligible Employee Status. A Participant who is no longer an Eligible Employee shall not be permitted to submit a Deferral Election Form and shall no longer be eligible for Discretionary Contributions. All deferrals then in effect for such Participant shall cease as of the earlier to occur of (a) the Participant’s Termination, or (b) the end of the Plan Year in which the Participant is determined to no longer be an Eligible Employee. Amounts credited to the Account of a Participant who is no longer an Eligible Employee shall continue to be administered in accordance with the terms and conditions of this Plan and shall be distributed as provided in Article 7.00. |
(a) | Deferral Elections - In General. |
(i) | A Participant may elect to defer Compensation under this Plan by submitting a signed Deferral Election Form to the Committee within the deadlines imposed by this Plan and set forth in Section 4.01(b). Any deferral election made by a Participant for a Plan Year shall be irrevocable after the expiration of the applicable deadline described in Section 4.01(b); provided, however, that a cessation of deferrals shall be allowed if the Participant suffers an Unforeseeable Emergency, becomes Disabled, or to the extent permitted by Treasury Regulation §1.409A-3(j)(4)(viii). |
(ii) | Amounts deferred under this Plan shall not be made available to the Participant, except as provided in Article 7.00, and shall reduce the Compensation payable to the Participant in the year of the deferral in accordance with the provisions of the applicable Deferral Election Form; provided, however, that all such amounts shall be subject to the rights of the general creditors of the Company and its Affiliates as provided in Article 12.00 of this Plan. |
(b) | Timing of Deferral Elections. A deferral election under this Plan shall be effective only if it is made in a timely manner as follows: |
(i) | In General. Except as permitted under subsections (ii) and (iii) of this Section 4.01(b), a Deferral Election Form must be submitted to the Committee by the last day of the Plan Year preceding the Plan Year in which services giving rise to the Compensation to be deferred are to be performed. |
(ii) | First Year of Eligibility. Notwithstanding the foregoing, if and to the extent permitted by the Committee, during the first Plan Year in which an Eligible Employee is eligible |
(iii) | Performance-Based Compensation. Notwithstanding the foregoing and to the extent permitted by the Committee, a Deferral Election Form with respect to any performance-based compensation (within the meaning of Code §409A) may be submitted by an Eligible Employee or a Participant, as the case may be, by the date that is not later than six months before the end of the performance period with respect to which the performance-based compensation is based; provided that in no event may an election to defer be made after such performance-based compensation has become readily ascertainable. |
(c) | Additional Requirements for Deferral Elections. Deferrals made pursuant to a Deferral Election Form must be made in whole percentages and subject to such other limitations as the Committee may impose from time to time in its sole discretion. |
4.02 | Discretionary Contributions. The Company or one of its Affiliates, as applicable, shall make Discretionary Contributions to the Account of a Participant in such amount that would have been made pursuant to the Qualified Plan as matching contributions had all amounts elected to be deferred under this Plan pursuant to Section 4.01 been deferred under the Qualified Plan and as if the Statutory Limits did not exist. Such Discretionary Contributions shall be credited to the Accounts of Participants during the first calendar quarter following the last day of the Plan Year with respect to which the related Compensation was deferred. |
(a) | Deferrals. Deferrals of Compensation, if any, shall be credited to a Participant’s Account as soon as administratively practicable following each payroll period. |
(b) | Discretionary Contributions. Any Discretionary Contribution shall be credited to a Participant’s Account on the date of such Discretionary Contribution. |
5.01 | Deferrals of Compensation. A Participant shall be one hundred percent (100%) vested in the portion of his or her Account attributable to deferrals of Compensation under Section 4.01 of this Plan and any deemed earnings or losses on the investment of such deferrals. |
5.02 | Discretionary Contributions. Except as otherwise provided in Section 5.03 of this Plan, a Participant shall have a vested right to the portion of his or her Account attributable to any Discretionary Contribution and any deemed earnings and losses on the investment of such Discretionary Contribution in accordance with the vesting schedule under the Qualified Plan. |
5.03 | Accelerated Vesting Upon Occurrence of Certain Events. Notwithstanding the foregoing, a Participant shall become fully vested in all amounts credited to his or her Account upon the Participant’s Retirement or, if earlier, death. |
5.04 | Amounts Not Vested. Any amounts credited to a Participant’s Account that are not vested upon his or her Termination shall be forfeited. |
6.01 | Establishment of Accounts. The Committee shall establish and maintain an Account for each Participant. Each Participant’s Account shall be credited with, to the extent applicable, any deferrals of Compensation and Discretionary Contributions, and the Participant’s allocable share of any deemed earnings or losses on the foregoing. Each Participant’s Account shall be reduced by any distributions made from such Account plus, subject to Article 8.00 of this Plan and to the extent permitted by applicable law, any federal, state and local tax withholding as may be required by law. |
6.02 | Establishment of Subaccounts. Within each Participant’s Account, separate subaccounts shall be maintained to the extent necessary for the administration of the Plan. |
(a) | Each Participant’s Account shall be credited with earnings or interest as though such Account were invested in such investments and under such criteria as the Committee may determine in its sole discretion. The Company may also permit the Participant to direct the deemed investment of the Account in such investments as the Company may make available for this purpose from time to time. The Company assumes no responsibility or liability with respect to any loss or expense that may arise, result or be incurred from any deemed investment of the Account. Any costs or expenses incurred by the Company in the deemed investment of the Account shall be debited against the Account. The Account shall be credited with earnings or debited for losses, as the case may be, based on its deemed investment pursuant to Section 6.03(b). |
(b) | As of each Valuation Date, each Participant’s Account will be credited with earnings and charged with losses equal to the amount by which the Account would have been credited or charged since the prior Valuation Date had the Participant’s Account been invested as described in Section 6.03(a) of this Plan. |
(c) | For purposes of clarity, neither the Company nor any of its Affiliates shall have any obligation to invest any funds in accordance with the deemed investment elections described in this Section 6.03. Participants’ Accounts shall merely be bookkeeping entries on the books of the Company and its Affiliates, as applicable, and no Participant or Beneficiary shall obtain any property right or interest in any investment or any other particular assets of the Company or any of its Affiliates. |
7.01 | Distributions Upon Termination (Other than Death). |
(a) | Except as otherwise provided in this Section 7.01, a Participant may elect to have distribution of his or her Plan Benefit paid in up to ten (10) substantially equal annual installments beginning on the January 1 immediately following the Participant’s Termination and on each |
(b) | An election to receive annual installments under this Section 7.01 must be made on a signed Distribution Election Form that is submitted to the Committee no later than thirty (30) days after the date on which the Participant first becomes eligible to participate in this Plan, with respect to any deferral of Compensation or Discretionary Contribution made or credited for services performed after such election is made. For purposes of the preceding sentence, an Eligible Employee shall be first eligible to participate in this Plan only if the Eligible Employee is not eligible to participate in any other arrangement that, along with this Plan, is treated as a single nonqualified deferred compensation plan under Code §409A and the Treasury Regulations promulgated thereunder. |
(i) | The election described in this Section 7.01(b) shall be subject to the terms and conditions specified in this Plan and in the Distribution Election Form and, except as provided in Section 7.01(b)(iii) of this Plan, shall be irrevocable once made. |
(ii) | A Participant may elect to change the form of distribution (based on the alternatives described in Section 7.01(a) of this Plan) by submitting a new Distribution Election Form to the Committee; provided, however, that: (A) such change may not take effect until at least twelve (12) months after the date on which such election is made; (B) the payment with respect to which such change is made must be deferred (other than a distribution upon death) for a period of not less than five (5) years from the date such payment would otherwise have been paid (or, in the case of installment payments, from the date the first amount was scheduled to be paid); and (C) such change must be made not less than twelve (12) months before the date the payment is scheduled to be paid (or, in the case of installment payments, from the date the first amount was scheduled to be paid). |
(iii) | Once a Participant’s Plan Benefit is or begins to be distributed, no further changes to the distribution of such Plan Benefit shall be permitted. For purposes of this Section 7.01, if the right to any payments would constitute the right to a “series of installment payments” within the meaning of Code §409A, then such payments shall be treated as a single payment within the meaning of Code §409A. |
(c) | Notwithstanding any provision in the Plan to the contrary, the Committee, in its sole discretion, may require a lump sum distribution of a Participant’s Plan Benefit if: (a) the distribution results in the termination and liquidation of the entirety of the Participant’s interest under this Plan and all agreements, methods, programs or other arrangements with respect to which deferrals of compensation are treated as having been deferred under a single nonqualified deferred compensation plan under Code §409A; and (b) the aggregate distribution under the arrangements is not greater than $15,000. |
(d) | Notwithstanding any provision in this Plan to the contrary, any Plan Benefit payable to a Participant who is a “specified employee” (as defined in Code §409A) of the Company or any of its Affiliates upon the Participant’s Termination shall not be (or begin to be) distributed until six months after the date on which the Participant Terminates (or, if earlier, the date on which the Participant dies). The first payment to be made shall include the cumulative amount, if any, of any amounts that would otherwise have been paid in accordance with the Participant’s |
7.02 | Distributions Upon Death. |
(a) | Notwithstanding anything in this Plan to the contrary, if a Participant dies before his or her Plan Benefit has begun to be distributed or has been fully distributed, the Plan Benefit will be distributed to the Participant’s Beneficiary in a lump sum within ninety (90) days after the date of the Participant’s death. |
(b) | If a Participant dies after the Participant’s Termination and after his or her Plan Benefit has been fully distributed, no additional benefit will be due to such Participant or his or her Beneficiary under this Plan. |
7.03 | Termination for Cause. Notwithstanding anything in this Plan to the contrary, if a Participant is Terminated by the Company for Cause, all Discretionary Contributions and any deemed earnings on the foregoing credited to the Participant’s Account (whether or not vested) shall be forfeited as of the date of such Termination. |
7.04 | Unforeseeable Emergency. A Participant may request a distribution of his or her Plan Benefit upon the occurrence of an Unforeseeable Emergency. As a condition of receiving a distribution under this Section 7.04, the Participant must file a signed, written application with the Committee specifying the nature of the Unforeseeable Emergency, the amount needed to address the Unforeseeable Emergency and supplying any other information that the Committee, in its discretion, may need to ensure the conditions specified in this Section 7.04 are satisfied. The Committee shall, in its sole discretion, determine whether an Unforeseeable Emergency exists. If the Committee determines that an Unforeseeable Emergency exists, the Company or one of its Affiliates, as applicable, shall distribute an amount to the Participant that shall not be greater than the amount reasonably necessary, in the Committee’s determination, to satisfy the emergency need (which may include the amount necessary to pay any federal, state, local or foreign income taxes or penalties reasonably anticipated to result from the distribution) or, if less, the value of the Participant’s Plan Benefit as of the Valuation Date immediately preceding the distribution date. A distribution on account of an Unforeseeable Emergency may not be made to the extent that such emergency is or may be relieved through reimbursement or compensation from insurance or otherwise, or by liquidation of the Participant’s assets, to the extent that the liquidation of such assets would not cause a severe financial hardship. |
7.05 | Full Discharge. Once the Participant’s Plan Benefit has been fully distributed, none of the Company, its Affiliates, the Board, the Committee, their delegates or this Plan will have any further liability under this Plan to the Participant or the Participant’s Beneficiary. |
9.01 | Filing Claims. Any Participant or Beneficiary (a “claimant”) who believes that he or she is entitled to an unpaid Plan Benefit may file a written notification of his or her claim with the Committee. |
9.02 | Notification to Claimant. If the claim is wholly or partially denied, the Committee will, within a reasonable period of time, and in any event within ninety (90) days of the receipt of such claim, provide the claimant with written notice of the denial setting forth in a manner calculated to be understood by the claimant: |
(a) | The specific reason or reasons for which the claim was denied; |
(b) | Specific reference to pertinent Plan provisions, rules, procedures or protocols upon which the Committee relied to deny the claim; |
(c) | A description of any additional material or information that the claimant may file to perfect the claim and an explanation of why this material or information is necessary; and |
(d) | An explanation of this Plan’s claims review procedure and the time limits applicable to such procedure and a statement of the claimant’s right to bring a civil action under ERISA §502(a) following an adverse determination upon review. |
9.03 | Review Procedure. If a claim has been wholly or partially denied, the affected claimant, or his or her authorized representative may: |
(a) | Request that the Committee reconsider its initial denial by filing a written appeal within sixty (60) days after receiving written notice that all or part of the initial claim was denied; |
(b) | Review pertinent documents and other material upon which the Committee relied when denying the initial claim; and |
(c) | Submit a written description of the reasons for which the claimant disagrees with the Committee’s initial adverse decision. |
(i) | Specific reason or reasons for the decision; |
(ii) | Specific references to pertinent Plan provisions upon which the decision was based; |
(iii) | The claimant’s ability to review and receive copies of all documents relating to the claimant’s claim for benefits, free of charge; |
(iv) | An explanation of any voluntary review procedures describing the steps to be taken by a claimant who wishes to submit the claimant’s claims for review and the time limits applicable to such procedures; and |
(v) | A statement of the claimant’s right to bring a civil action under ERISA §502(a). |
(a) | The Committee is expressly empowered to interpret this Plan, determine all questions arising in the administration, interpretation and application of this Plan; employ actuaries, accountants, counsel and other persons the Committee deems necessary in connection with the administration of this Plan, request any information from the Company or any of its Affiliates the Committee deems necessary to determine whether the Company or any Affiliate would be considered insolvent or subject to a proceeding in bankruptcy, and take all other necessary and proper actions to fulfill its duties under this Plan. |
(b) | The Committee shall not be liable for any actions by it hereunder, unless due to its own negligence, willful misconduct or lack of good faith. |
(c) | The Committee (and any delegate under Section 10.01(d) of this Plan) shall be indemnified and saved harmless by the Company from and against all personal liability to which the Committee (and such delegate) may be subject by reason of any act done or omitted to be done in its official capacity as administrator in good faith in the administration of this Plan, including all expenses reasonably incurred in its defense in the event the Company fails to provide such defense upon the request of the Committee (or such delegate). |
(d) | In exercising its authority under this Plan, the Committee may allocate all or any part of its responsibilities and powers to any one or more of its members and may delegate all or any part of its responsibilities and powers to any person or persons selected by the Committee. Any such allocation or delegation may be revoked at any time. |
(a) | The Committee and any delegate under Section 10.01(d) of this Plan will serve without compensation for services provided to this Plan. The Company and, if applicable, its Affiliates, will furnish the Committee and any delegate under Section 10.01(d) of this Plan with all clerical or other assistance necessary to perform their respective duties. |
(b) | The Company and its Affiliates will pay most expenses of administering this Plan. However, any costs or expenses incurred by the Company or an Affiliate in connection with the |
(a) | All actions taken and all determinations made by the Committee in good faith will be final and binding upon all Participants, Beneficiaries, the Company and its Affiliates and any other person interested in this Plan. To the extent the Committee has been granted discretionary authority under this Plan, its prior exercise of this authority will not obligate the Committee to exercise its authority in a like fashion thereafter. |
(b) | This Plan will be interpreted by the Committee in accordance with its terms and their intended meaning. The construction and interpretation of the provisions of this Plan are vested with the Committee, in its absolute discretion, including, without limitation, the determination of benefits and eligibility. All decisions, determinations and interpretations will be final, conclusive and binding upon all persons having an interest in this Plan. |
13.01 | No Contract. The adoption and maintenance of this Plan shall not be deemed to constitute a contract of employment or otherwise between the Company or any of its Affiliates and any employee or Participant or other person, or to be consideration for, or an inducement or condition of, any employment. Nothing contained herein shall be deemed to give any employee or Participant or other person the right to be retained in the service of the Company or any of its Affiliates or to interfere with the right of the Company or any of its Affiliates (which right is expressly reserved) to discharge, with or without Cause, any employee or Participant or other person at any time without any liability |
13.02 | No Alienation. The right of a Participant or any other person to receive Plan Benefits may not be assigned, transferred, pledged or encumbered except as provided in the Participant’s designation of a Beneficiary, by will or by applicable laws of descent and distribution. Any attempt to assign, transfer, pledge or encumber a Plan Benefit will be null and void and of no legal effect. Any action taken (or attempted to be taken) contrary to the provisions of this Section 13.02 will be null and void and of no effect whatsoever; the Company, its Affiliates and the Committee may disregard such action (or attempted action) and will not in any manner be bound by it; and they, and each of them, will suffer no liability by doing so. If any Participant or other person acts (or attempts to take any action) contrary to this Section 13.02, the Company, its Affiliates and the Committee will be reimbursed and indemnified on demand out of the interest of such Participant in this Plan for any loss, cost or expense incurred as a result of disregarding or acting in disregard of that action (or attempted action). |
13.03 | Governing Law. This Plan, and applicable forms associated with this Plan, will be governed by and construed in accordance with the laws of the United States and, to the extent applicable, the laws of the State of Ohio, excluding any conflicts of laws principles. |
13.04 | Headings. Headings and subheadings in this Plan document are inserted for convenience of reference only. They constitute no part of this Plan. |
13.05 | Illegal or Invalid Provision. If any provision of this Plan is held to be illegal or invalid for any reason, this Plan will be construed and enforced as if the offending provision had not been included in this Plan. However, that determination will not affect the legality or validity of the remaining parts of this Plan. |
13.06 | Coordination with Other Plans. A Participant’s or his or her Beneficiary’s rights to any Plan Benefits will be determined solely by reference to the terms of this Plan document and will be unaffected by any other document or agreement between the Participant or the Beneficiary and the Company or any of its Affiliates. |
13.07 | Code §409A. Although the Company makes no guarantee with respect to the treatment of payment or benefits under this Plan, this Plan is intended to comply with the requirements of Code §409A and the Treasury Regulations promulgated thereunder, and the Company will interpret, apply and administer this Plan in accordance with this intent. The Company may accelerate the time or schedule of a distribution to a Participant or the Participant’s Beneficiary at any time this Plan fails to meet the requirements of Code §409A. Such payment may not exceed the amount required to be included in income as a result of the failure to comply with the requirements of Code §409A. Notwithstanding the foregoing, none of the Company, its Affiliates, the Board or the Committee or their delegates shall have any liability to a Participant for failure to comply with the requirements of Code §409A. |
PEOPLES BANCORP INC. | |||
By: /s/ | CAROL SCHNEEBERGER | ||
Carol Schneeberger | |||
Executive Vice President, Chief Administrative Officer | |||
1. | I have reviewed this Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2019, of Peoples Bancorp 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 registrant's board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: | August 1, 2019 | By:/s/ | CHARLES W. SULERZYSKI | |
Charles W. Sulerzyski | ||||
President and Chief Executive Officer |
1. | I have reviewed this Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2019, of Peoples Bancorp 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 registrant's board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: | August 1, 2019 | By:/s/ | JOHN C. ROGERS | |
John C. Rogers | ||||
Executive Vice President, | ||||
Chief Financial Officer and Treasurer |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and |
(2) | The information contained in the Report fairly presents, in all material respects, the consolidated financial condition and results of operations of Peoples Bancorp and its subsidiaries. |
Date: | August 1, 2019 | By: /s/ | CHARLES W. SULERZYSKI | |
Charles W. Sulerzyski | ||||
President and Chief Executive Officer |
Date: | August 1, 2019 | By:/s/ | JOHN C. ROGERS | |
John C. Rogers | ||||
Executive Vice President, | ||||
Chief Financial Officer and Treasurer |
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