Hawaii | 99-0212597 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
Large accelerated filer x | Accelerated filer o | Non-accelerated filer o | Smaller reporting company o |
Page | ||
Item I. | Financial Statements (Unaudited) | |
(dollars in thousands) | September 30, 2016 | December 31, 2015 | |||||
Assets | |||||||
Cash and due from banks | $ | 79,647 | $ | 71,797 | |||
Interest-bearing deposits in other banks | 23,727 | 8,397 | |||||
Investment securities: | |||||||
Available-for-sale, at fair value | 1,262,224 | 1,272,255 | |||||
Held-to-maturity, at amortized cost; fair value of: $230,529 at September 30, 2016 and $244,136 at December 31, 2015 | 226,573 | 247,917 | |||||
Total investment securities | 1,488,797 | 1,520,172 | |||||
Loans held for sale | 12,755 | 14,109 | |||||
Loans and leases | 3,439,654 | 3,211,532 | |||||
Allowance for loan and lease losses | (59,384 | ) | (63,314 | ) | |||
Net loans and leases | 3,380,270 | 3,148,218 | |||||
Premises and equipment, net | 48,242 | 49,161 | |||||
Accrued interest receivable | 14,554 | 14,898 | |||||
Investment in unconsolidated subsidiaries | 7,011 | 6,157 | |||||
Other real estate owned | 791 | 1,962 | |||||
Mortgage servicing rights | 15,638 | 17,797 | |||||
Core deposit premium | 5,349 | 7,355 | |||||
Bank-owned life insurance | 155,233 | 153,967 | |||||
Federal Home Loan Bank stock | 12,173 | 8,606 | |||||
Other assets | 75,760 | 108,692 | |||||
Total Assets | $ | 5,319,947 | $ | 5,131,288 | |||
Liabilities | |||||||
Deposits: | |||||||
Noninterest-bearing demand | $ | 1,194,557 | $ | 1,145,244 | |||
Interest-bearing demand | 849,128 | 824,895 | |||||
Savings and money market | 1,379,484 | 1,399,093 | |||||
Time | 1,095,409 | 1,064,207 | |||||
Total deposits | 4,518,578 | 4,433,439 | |||||
Short-term borrowings | 150,000 | 69,000 | |||||
Long-term debt | 92,785 | 92,785 | |||||
Other liabilities | 39,092 | 41,425 | |||||
Total Liabilities | 4,800,455 | 4,636,649 | |||||
Equity | |||||||
Preferred stock, no par value, authorized 1,000,000 shares; issued and outstanding: none at September 30, 2016 and December 31, 2015 | — | — | |||||
Common stock, no par value, authorized 185,000,000 shares; issued and outstanding: 30,930,598 at September 30, 2016 and 31,361,452 at December 31, 2015 | 534,856 | 548,878 | |||||
Surplus | 84,207 | 82,847 | |||||
Accumulated deficit | (116,225 | ) | (137,314 | ) | |||
Accumulated other comprehensive income | 16,628 | 203 | |||||
Total Shareholders' Equity | 519,466 | 494,614 | |||||
Non-controlling interest | 26 | 25 | |||||
Total Equity | 519,492 | 494,639 | |||||
Total Liabilities and Equity | $ | 5,319,947 | $ | 5,131,288 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
(dollars in thousands, except per share data) | 2016 | 2015 | 2016 | 2015 | |||||||||||
Interest income: | |||||||||||||||
Interest and fees on loans and leases | $ | 33,384 | $ | 30,148 | $ | 98,055 | $ | 88,322 | |||||||
Interest and dividends on investment securities: | |||||||||||||||
Taxable interest | 7,296 | 8,260 | 23,645 | 24,687 | |||||||||||
Tax-exempt interest | 995 | 1,008 | 2,986 | 3,016 | |||||||||||
Dividends | 10 | 9 | 30 | 26 | |||||||||||
Interest on deposits in other banks | 17 | 6 | 45 | 28 | |||||||||||
Dividends on Federal Home Loan Bank stock | 63 | 11 | 123 | 40 | |||||||||||
Total interest income | 41,765 | 39,442 | 124,884 | 116,119 | |||||||||||
Interest expense: | |||||||||||||||
Interest on deposits: | |||||||||||||||
Demand | 126 | 104 | 360 | 298 | |||||||||||
Savings and money market | 254 | 230 | 786 | 678 | |||||||||||
Time | 1,044 | 568 | 2,899 | 1,665 | |||||||||||
Interest on short-term borrowings | 160 | 73 | 387 | 195 | |||||||||||
Interest on long-term debt | 755 | 662 | 2,206 | 1,949 | |||||||||||
Total interest expense | 2,339 | 1,637 | 6,638 | 4,785 | |||||||||||
Net interest income | 39,426 | 37,805 | 118,246 | 111,334 | |||||||||||
Provision (credit) for loan and lease losses | (743 | ) | (3,647 | ) | (2,872 | ) | (13,713 | ) | |||||||
Net interest income after credit for loan and lease losses | 40,169 | 41,452 | 121,118 | 125,047 | |||||||||||
Other operating income: | |||||||||||||||
Service charges on deposit accounts | 1,954 | 1,947 | 5,826 | 5,830 | |||||||||||
Loan servicing fees | 1,357 | 1,407 | 4,081 | 4,257 | |||||||||||
Other service charges and fees | 2,821 | 2,803 | 8,616 | 8,689 | |||||||||||
Income from fiduciary activities | 880 | 854 | 2,577 | 2,518 | |||||||||||
Equity in earnings of unconsolidated subsidiaries | 182 | 165 | 456 | 490 | |||||||||||
Fees on foreign exchange | 129 | 126 | 403 | 352 | |||||||||||
Investment securities gains (losses) | — | — | — | (1,866 | ) | ||||||||||
Income from bank-owned life insurance | 555 | 434 | 2,412 | 1,569 | |||||||||||
Loan placement fees | 140 | 202 | 319 | 574 | |||||||||||
Net gain on sales of residential mortgage loans | 2,212 | 1,551 | 5,523 | 4,775 | |||||||||||
Net gain on sales of foreclosed assets | 57 | 252 | 606 | 379 | |||||||||||
Other | 688 | 88 | 2,013 | 1,576 | |||||||||||
Total other operating income | 10,975 | 9,829 | 32,832 | 29,143 | |||||||||||
Other operating expense: | |||||||||||||||
Salaries and employee benefits | 17,459 | 17,193 | 52,246 | 49,534 | |||||||||||
Net occupancy | 3,588 | 3,547 | 10,459 | 10,451 | |||||||||||
Equipment | 852 | 775 | 2,432 | 2,617 | |||||||||||
Amortization of other intangible assets | 1,690 | 1,683 | 6,291 | 5,347 | |||||||||||
Communication expense | 948 | 895 | 2,826 | 2,661 | |||||||||||
Legal and professional services | 1,699 | 1,808 | 5,035 | 5,669 | |||||||||||
Computer software expense | 2,217 | 2,286 | 7,143 | 6,764 | |||||||||||
Advertising expense | 772 | 502 | 1,839 | 1,586 | |||||||||||
Foreclosed asset expense | 72 | 3 | 136 | 332 | |||||||||||
Other | 3,989 | 3,483 | 11,969 | 13,690 | |||||||||||
Total other operating expense | 33,286 | 32,175 | 100,376 | 98,651 | |||||||||||
Income before income taxes | 17,858 | 19,106 | 53,574 | 55,539 | |||||||||||
Income tax expense | 6,392 | 6,900 | 18,790 | 20,603 | |||||||||||
Net income | $ | 11,466 | $ | 12,206 | $ | 34,784 | $ | 34,936 | |||||||
Per common share data: | |||||||||||||||
Basic earnings per common share | $ | 0.37 | $ | 0.39 | $ | 1.12 | $ | 1.07 | |||||||
Diluted earnings per common share | $ | 0.37 | $ | 0.38 | $ | 1.11 | $ | 1.06 | |||||||
Cash dividends declared | $ | 0.16 | $ | 0.12 | $ | 0.44 | $ | 0.36 | |||||||
Shares used in computation: | |||||||||||||||
Basic shares | 30,943,756 | 31,330,964 | 31,088,729 | 32,548,479 | |||||||||||
Diluted shares | 31,142,128 | 31,749,880 | 31,277,402 | 32,932,347 |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
(dollars in thousands) | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Net income | $ | 11,466 | $ | 12,206 | $ | 34,784 | $ | 34,936 | ||||||||
Other comprehensive income (loss), net of tax: | ||||||||||||||||
Net change in unrealized gain (loss) on investment securities | (2,042 | ) | 7,563 | 15,677 | 3,102 | |||||||||||
Minimum pension liability adjustment | 249 | 259 | 748 | 775 | ||||||||||||
Total other comprehensive income (loss), net of tax | (1,793 | ) | 7,822 | 16,425 | 3,877 | |||||||||||
Comprehensive income | $ | 9,673 | $ | 20,028 | $ | 51,209 | $ | 38,813 |
Common Shares Outstanding | Preferred Stock | Common Stock | Surplus | Accumulated Deficit | Accumulated Other Comprehensive Income | Non- Controlling Interest | Total | |||||||||||||||||||||||
(Dollars in thousands, except per share data) | ||||||||||||||||||||||||||||||
Balance at December 31, 2015 | 31,361,452 | $ | — | $ | 548,878 | $ | 82,847 | $ | (137,314 | ) | $ | 203 | $ | 25 | $ | 494,639 | ||||||||||||||
Net income | — | — | — | — | 34,784 | — | — | 34,784 | ||||||||||||||||||||||
Other comprehensive income | — | — | — | — | — | 16,425 | — | 16,425 | ||||||||||||||||||||||
Cash dividends ($0.44 per share) | — | — | — | — | (13,695 | ) | — | — | (13,695 | ) | ||||||||||||||||||||
22,800 net shares of common stock sold by directors’ deferred compensation plan | — | — | (537 | ) | — | — | — | — | (537 | ) | ||||||||||||||||||||
636,922 shares of common stock repurchased and other related costs | (636,922 | ) | — | (14,084 | ) | — | — | — | — | (14,084 | ) | |||||||||||||||||||
Share-based compensation | 206,068 | — | 599 | 1,360 | — | — | — | 1,959 | ||||||||||||||||||||||
Non-controlling interest | — | — | — | — | — | — | 1 | 1 | ||||||||||||||||||||||
Balance at September 30, 2016 | 30,930,598 | $ | — | $ | 534,856 | $ | 84,207 | $ | (116,225 | ) | $ | 16,628 | $ | 26 | $ | 519,492 | ||||||||||||||
Balance at December 31, 2014 | 35,233,674 | $ | — | $ | 642,205 | $ | 79,716 | $ | (157,039 | ) | $ | 3,159 | $ | — | $ | 568,041 | ||||||||||||||
Net income | — | — | — | — | 34,936 | — | — | 34,936 | ||||||||||||||||||||||
Other comprehensive income | — | — | — | — | — | 3,877 | — | 3,877 | ||||||||||||||||||||||
Cash dividends ($0.36 per share) | — | — | — | — | (11,718 | ) | — | — | (11,718 | ) | ||||||||||||||||||||
8,159 net shares of common stock sold by directors’ deferred compensation plan | — | — | (154 | ) | — | — | — | — | (154 | ) | ||||||||||||||||||||
4,122,881 shares of common stock repurchased and other related costs | (4,122,881 | ) | — | (93,533 | ) | — | — | — | — | (93,533 | ) | |||||||||||||||||||
Share-based compensation | 219,851 | — | — | 1,812 | — | — | — | 1,812 | ||||||||||||||||||||||
Non-controlling interest | — | — | — | — | — | — | — | — | ||||||||||||||||||||||
Balance at September 30, 2015 | 31,330,644 | $ | — | $ | 548,518 | $ | 81,528 | $ | (133,821 | ) | $ | 7,036 | $ | — | $ | 503,261 |
Nine Months Ended September 30, | |||||||
2016 | 2015 | ||||||
(Dollars in thousands) | |||||||
Cash flows from operating activities: | |||||||
Net income | $ | 34,784 | $ | 34,936 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Provision (credit) for loan and lease losses | (2,872 | ) | (13,713 | ) | |||
Depreciation and amortization | 4,493 | 4,406 | |||||
Write down of other real estate, net of gain on sale | (251 | ) | 26 | ||||
Amortization of other intangible assets | 6,291 | 5,347 | |||||
Net amortization of investment securities | 9,326 | 7,418 | |||||
Share-based compensation | 1,360 | 1,812 | |||||
Net loss on investment securities | — | 1,866 | |||||
Net gain on sales of residential loans | (5,523 | ) | (4,775 | ) | |||
Proceeds from sales of loans held for sale | 315,348 | 304,351 | |||||
Originations of loans held for sale | (308,471 | ) | (299,679 | ) | |||
Equity in earnings of unconsolidated subsidiaries | (456 | ) | (490 | ) | |||
Net increase in cash surrender value of bank-owned life insurance | (2,772 | ) | (1,889 | ) | |||
Deferred income taxes | 18,790 | 19,045 | |||||
Net change in other assets and liabilities | (1,035 | ) | 3,235 | ||||
Net cash provided by operating activities | 69,012 | 61,896 | |||||
Cash flows from investing activities: | |||||||
Proceeds from maturities of and calls on investment securities available for sale | 140,258 | 125,688 | |||||
Proceeds from sales of investment securities available for sale | — | 117,496 | |||||
Purchases of investment securities available for sale | (112,870 | ) | (290,019 | ) | |||
Proceeds from maturities of and calls on investment securities held to maturity | 22,335 | 19,950 | |||||
Purchases of investment securities held to maturity | (1,644 | ) | (37,043 | ) | |||
Net loan originations | (152,906 | ) | (122,479 | ) | |||
Purchases of loan portfolios | (77,702 | ) | (52,806 | ) | |||
Proceeds from sales of loans originated for investment | — | 6,658 | |||||
Proceeds from sale of other real estate | 2,850 | 6,687 | |||||
Proceeds from bank-owned life insurance | 1,506 | 723 | |||||
Purchases of premises and equipment | (3,574 | ) | (3,014 | ) | |||
Net return of capital from unconsolidated subsidiaries | 528 | 424 | |||||
Contributions to unconsolidated subsidiaries | (5 | ) | — | ||||
Net (purchases) proceeds from redemption of FHLB stock | (3,567 | ) | 31,884 | ||||
Net cash used in investing activities | (184,791 | ) | (195,851 | ) | |||
Cash flows from financing activities: | |||||||
Net increase in deposits | 85,139 | 120,203 | |||||
Net increase in short-term borrowings | 81,000 | 117,000 | |||||
Cash dividends paid on common stock | (13,695 | ) | (11,718 | ) | |||
Repurchases of common stock and other related costs | (14,084 | ) | (93,533 | ) | |||
Net proceeds from issuance of common stock and stock option exercises | 599 | — | |||||
Net cash provided by financing activities | 138,959 | 131,952 | |||||
Net increase (decrease) in cash and cash equivalents | 23,180 | (2,003 | ) | ||||
Cash and cash equivalents at beginning of period | 80,194 | 86,007 | |||||
Cash and cash equivalents at end of period | $ | 103,374 | $ | 84,004 | |||
Supplemental disclosure of cash flow information: | |||||||
Cash paid during the period for: | |||||||
Interest | $ | 6,261 | $ | 4,841 | |||
Income taxes | — | 1,280 | |||||
Cash received during the period for: | |||||||
Income taxes | 1,605 | — | |||||
Supplemental disclosure of non-cash investing and financing activities: | |||||||
Net change in common stock held by directors’ deferred compensation plan | 537 | 154 | |||||
Net reclassification of loans to other real estate | 1,428 | 5,679 | |||||
Net transfer of loans to loans held for sale | — | 6,658 |
(dollars in thousands) | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | |||||||||||
September 30, 2016 | |||||||||||||||
Held-to-Maturity: | |||||||||||||||
Mortgage-backed securities: | |||||||||||||||
Residential - U.S. Government-sponsored entities | $ | 132,470 | $ | 890 | $ | (2 | ) | $ | 133,358 | ||||||
Commercial - U.S. Government-sponsored entities | 94,103 | 3,068 | — | 97,171 | |||||||||||
Total | $ | 226,573 | $ | 3,958 | $ | (2 | ) | $ | 230,529 | ||||||
Available-for-Sale: | |||||||||||||||
Debt securities: | |||||||||||||||
States and political subdivisions | $ | 185,504 | $ | 6,300 | $ | (26 | ) | $ | 191,778 | ||||||
Corporate securities | 107,011 | 2,609 | (12 | ) | 109,608 | ||||||||||
Mortgage-backed securities: | |||||||||||||||
Residential - U.S. Government-sponsored entities | 747,636 | 11,881 | (314 | ) | 759,203 | ||||||||||
Residential - Non-government agencies | 55,480 | 2,142 | — | 57,622 | |||||||||||
Commercial - Non-government agencies | 135,296 | 7,933 | — | 143,229 | |||||||||||
Other | 692 | 92 | — | 784 | |||||||||||
Total | $ | 1,231,619 | $ | 30,957 | $ | (352 | ) | $ | 1,262,224 |
(dollars in thousands) | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | |||||||||||
December 31, 2015 | |||||||||||||||
Held-to-Maturity: | |||||||||||||||
Mortgage-backed securities: | |||||||||||||||
Residential - U.S. Government-sponsored entities | $ | 152,315 | $ | 123 | $ | (2,915 | ) | $ | 149,523 | ||||||
Commercial - U.S. Government-sponsored entities | 95,602 | — | (989 | ) | 94,613 | ||||||||||
Total | $ | 247,917 | $ | 123 | $ | (3,904 | ) | $ | 244,136 | ||||||
Available-for-Sale: | |||||||||||||||
Debt securities: | |||||||||||||||
States and political subdivisions | $ | 187,552 | $ | 3,819 | $ | (898 | ) | $ | 190,473 | ||||||
Corporate securities | 107,721 | 1,077 | (227 | ) | 108,571 | ||||||||||
Mortgage-backed securities: | |||||||||||||||
Residential - U.S. Government-sponsored entities | 771,657 | 5,885 | (5,633 | ) | 771,909 | ||||||||||
Residential - Non-government agencies | 64,286 | 733 | (987 | ) | 64,032 | ||||||||||
Commercial - Non-government agencies | 135,439 | 2,033 | (1,118 | ) | 136,354 | ||||||||||
Other | 848 | 68 | — | 916 | |||||||||||
Total | $ | 1,267,503 | $ | 13,615 | $ | (8,863 | ) | $ | 1,272,255 |
September 30, 2016 | |||||||
(dollars in thousands) | Amortized Cost | Estimated Fair Value | |||||
Held-to-Maturity: | |||||||
Mortgage-backed securities: | |||||||
Residential - U.S. Government-sponsored entities | $ | 132,470 | $ | 133,358 | |||
Commercial - U.S. Government-sponsored entities | 94,103 | 97,171 | |||||
Total | $ | 226,573 | $ | 230,529 | |||
Available-for-Sale: | |||||||
Due in one year or less | $ | 13,648 | $ | 13,676 | |||
Due after one year through five years | 124,029 | 127,061 | |||||
Due after five years through ten years | 73,338 | 75,987 | |||||
Due after ten years | 81,500 | 84,662 | |||||
Mortgage-backed securities: | |||||||
Residential - U.S. Government-sponsored entities | 747,636 | 759,203 | |||||
Residential - Non-government agencies | 55,480 | 57,622 | |||||
Commercial - Non-government agencies | 135,296 | 143,229 | |||||
Other | 692 | 784 | |||||
Total | $ | 1,231,619 | $ | 1,262,224 |
Less Than 12 Months | 12 Months or Longer | Total | |||||||||||||||||||||
(dollars in thousands) | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | |||||||||||||||||
September 30, 2016 | |||||||||||||||||||||||
Debt securities: | |||||||||||||||||||||||
States and political subdivisions | $ | 3,425 | $ | (26 | ) | $ | — | $ | — | $ | 3,425 | $ | (26 | ) | |||||||||
Corporate securities | 5,497 | (12 | ) | — | — | 5,497 | (12 | ) | |||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||
Residential - U.S. Government-sponsored entities | 101,566 | (263 | ) | 4,181 | (53 | ) | 105,747 | (316 | ) | ||||||||||||||
Total temporarily impaired securities | $ | 110,488 | $ | (301 | ) | $ | 4,181 | $ | (53 | ) | $ | 114,669 | $ | (354 | ) |
Less Than 12 Months | 12 Months or Longer | Total | |||||||||||||||||||||
(dollars in thousands) | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | |||||||||||||||||
December 31, 2015 | |||||||||||||||||||||||
Debt securities: | |||||||||||||||||||||||
States and political subdivisions | $ | 30,481 | $ | (532 | ) | $ | 12,576 | $ | (366 | ) | $ | 43,057 | $ | (898 | ) | ||||||||
Corporate securities | 32,977 | (227 | ) | — | — | 32,977 | (227 | ) | |||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||
Residential - U.S. Government-sponsored entities | 507,525 | (6,241 | ) | 88,271 | (2,307 | ) | 595,796 | (8,548 | ) | ||||||||||||||
Residential - Non-government agencies | 37,975 | (987 | ) | — | — | 37,975 | (987 | ) | |||||||||||||||
Commercial - U.S. Government-sponsored entities | 94,613 | (989 | ) | — | — | 94,613 | (989 | ) | |||||||||||||||
Commercial - Non-government agencies | 62,555 | (961 | ) | 4,644 | (157 | ) | 67,199 | (1,118 | ) | ||||||||||||||
Total temporarily impaired securities | $ | 766,126 | $ | (9,937 | ) | $ | 105,491 | $ | (2,830 | ) | $ | 871,617 | $ | (12,767 | ) |
• | The length of time and the extent to which fair value has been less than the amortized cost basis; |
• | Adverse conditions specifically related to the security, an industry, or a geographic area; |
• | The historical and implied volatility of the fair value of the security; |
• | The payment structure of the debt security and the likelihood of the issuer being able to make payments; |
• | Failure of the issuer to make scheduled interest or principal payments; |
• | Any rating changes by a rating agency; and |
• | Recoveries or additional declines in fair value subsequent to the balance sheet date. |
(dollars in thousands) | September 30, 2016 | December 31, 2015 | |||||
Commercial, financial and agricultural | $ | 507,573 | $ | 520,457 | |||
Real estate: | |||||||
Construction | 108,457 | 85,196 | |||||
Residential mortgage | 1,157,914 | 1,131,882 | |||||
Home equity | 351,258 | 301,980 | |||||
Commercial mortgage | 863,680 | 761,566 | |||||
Consumer: | |||||||
Automobiles | 217,526 | 190,202 | |||||
Other consumer | 230,789 | 217,822 | |||||
Leases | 756 | 1,028 | |||||
Gross loans and leases | 3,437,953 | 3,210,133 | |||||
Net deferred costs | 1,701 | 1,399 | |||||
Total loans and leases, net of deferred costs | $ | 3,439,654 | $ | 3,211,532 | |||
Real Estate | |||||||||||||||||||||||||||||||||||||||
(dollars in thousands) | Comml, Fin & Ag | Constr | Resi Mortgage | Home Equity | Comml Mortgage | Consumer - Auto | Consumer - Other | Leases | Unallocated | Total | |||||||||||||||||||||||||||||
September 30, 2016 | |||||||||||||||||||||||||||||||||||||||
Allowance for loan and lease losses attributable to loans: | |||||||||||||||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 5 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 5 | |||||||||||||||||||
Collectively evaluated for impairment | 4,547 | 2,386 | 13,914 | 4,012 | 26,370 | 2,937 | 3,213 | — | — | 57,379 | |||||||||||||||||||||||||||||
Subtotal | 4,552 | 2,386 | 13,914 | 4,012 | 26,370 | 2,937 | 3,213 | — | — | 57,384 | |||||||||||||||||||||||||||||
Unallocated | — | — | — | — | — | — | — | — | 2,000 | 2,000 | |||||||||||||||||||||||||||||
Total ending balance | $ | 4,552 | $ | 2,386 | $ | 13,914 | $ | 4,012 | $ | 26,370 | $ | 2,937 | $ | 3,213 | $ | — | $ | 2,000 | $ | 59,384 | |||||||||||||||||||
Loans and leases: | |||||||||||||||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 2,004 | $ | 3,046 | $ | 21,481 | $ | 573 | $ | 7,952 | $ | — | $ | — | $ | — | $ | — | $ | 35,056 | |||||||||||||||||||
Collectively evaluated for impairment | 505,569 | 105,411 | 1,136,433 | 350,685 | 855,728 | 217,526 | 230,789 | 756 | — | 3,402,897 | |||||||||||||||||||||||||||||
Subtotal | 507,573 | 108,457 | 1,157,914 | 351,258 | 863,680 | 217,526 | 230,789 | 756 | — | 3,437,953 | |||||||||||||||||||||||||||||
Net deferred costs (income) | 411 | (229 | ) | 2,827 | (2 | ) | (963 | ) | — | (343 | ) | — | — | 1,701 | |||||||||||||||||||||||||
Total loans and leases, net of deferred costs (income) | $ | 507,984 | $ | 108,228 | $ | 1,160,741 | $ | 351,256 | $ | 862,717 | $ | 217,526 | $ | 230,446 | $ | 756 | $ | — | $ | 3,439,654 |
Real Estate | |||||||||||||||||||||||||||||||||||||||
(dollars in thousands) | Comml, Fin & Ag | Constr | Resi Mortgage | Home Equity | Comml Mortgage | Consumer - Auto | Consumer - Other | Leases | Unallocated | Total | |||||||||||||||||||||||||||||
December 31, 2015 | |||||||||||||||||||||||||||||||||||||||
Allowance for loan and lease losses attributable to loans: | |||||||||||||||||||||||||||||||||||||||
Individually evaluated for impairment | $ | — | $ | — | $ | — | $ | — | $ | 51 | $ | — | $ | — | $ | — | $ | — | $ | 51 | |||||||||||||||||||
Collectively evaluated for impairment | 6,905 | 8,454 | 14,642 | 3,096 | 21,796 | 2,891 | 3,339 | — | — | 61,123 | |||||||||||||||||||||||||||||
Subtotal | 6,905 | 8,454 | 14,642 | 3,096 | 21,847 | 2,891 | 3,339 | — | — | 61,174 | |||||||||||||||||||||||||||||
Unallocated | — | — | — | — | — | — | — | — | 2,140 | 2,140 | |||||||||||||||||||||||||||||
Total ending balance | $ | 6,905 | $ | 8,454 | $ | 14,642 | $ | 3,096 | $ | 21,847 | $ | 2,891 | 3,339 | $ | — | $ | 2,140 | $ | 63,314 | ||||||||||||||||||||
Loans and leases: | |||||||||||||||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 1,044 | $ | 4,126 | $ | 21,940 | $ | 776 | $ | 10,318 | $ | — | $ | — | $ | — | $ | — | $ | 38,204 | |||||||||||||||||||
Collectively evaluated for impairment | 519,413 | 81,070 | 1,109,942 | 301,204 | 751,248 | 190,202 | 217,822 | 1,028 | — | 3,171,929 | |||||||||||||||||||||||||||||
Subtotal | 520,457 | 85,196 | 1,131,882 | 301,980 | 761,566 | 190,202 | 217,822 | 1,028 | — | 3,210,133 | |||||||||||||||||||||||||||||
Net deferred costs (income) | 629 | (311 | ) | 2,443 | — | (817 | ) | — | (545 | ) | — | — | 1,399 | ||||||||||||||||||||||||||
Total loans and leases, net of deferred costs (income) | $ | 521,086 | $ | 84,885 | $ | 1,134,325 | $ | 301,980 | $ | 760,749 | $ | 190,202 | 217,277 | $ | 1,028 | $ | — | $ | 3,211,532 |
(dollars in thousands) | Unpaid Principal Balance | Recorded Investment | Allowance Allocated | ||||||||
September 30, 2016 | |||||||||||
Impaired loans with no related allowance recorded: | |||||||||||
Commercial, financial & agricultural | $ | 943 | $ | 832 | $ | — | |||||
Real estate: | |||||||||||
Construction | 9,310 | 3,046 | — | ||||||||
Residential mortgage | 23,260 | 21,481 | — | ||||||||
Home equity | 573 | 573 | — | ||||||||
Commercial mortgage | 8,810 | 7,952 | — | ||||||||
Total impaired loans with no related allowance recorded | 42,896 | 33,884 | — | ||||||||
Impaired loans with an allowance recorded: | |||||||||||
Commercial, financial & agricultural | 1,172 | 1,172 | 5 | ||||||||
Total impaired loans with an allowance recorded | 1,172 | 1,172 | 5 | ||||||||
Total | $ | 44,068 | $ | 35,056 | $ | 5 |
(dollars in thousands) | Unpaid Principal Balance | Recorded Investment | Allowance Allocated | ||||||||
December 31, 2015 | |||||||||||
Impaired loans with no related allowance recorded: | |||||||||||
Commercial, financial & agricultural | $ | 1,155 | $ | 1,044 | $ | — | |||||
Real estate: | |||||||||||
Construction | 10,472 | 4,126 | — | ||||||||
Residential mortgage | 24,016 | 21,940 | — | ||||||||
Home equity | 776 | 776 | — | ||||||||
Commercial mortgage | 10,010 | 9,152 | — | ||||||||
Total impaired loans with no related allowance recorded | 46,429 | 37,038 | — | ||||||||
Impaired loans with an allowance recorded: | |||||||||||
Commercial mortgage | 1,166 | 1,166 | 51 | ||||||||
Total impaired loans with an allowance recorded | 1,166 | 1,166 | 51 | ||||||||
Total | $ | 47,595 | $ | 38,204 | $ | 51 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||||
September 30, 2016 | September 30, 2015 | September 30, 2016 | September 30, 2015 | ||||||||||||||||||||||||||||
(dollars in thousands) | Average Recorded Investment | Interest Income Recognized | Average Recorded Investment | Interest Income Recognized | Average Recorded Investment | Interest Income Recognized | Average Recorded Investment | Interest Income Recognized | |||||||||||||||||||||||
Commercial, financial & agricultural | $ | 2,047 | $ | — | $ | 3,444 | $ | 4 | $ | 1,882 | $ | 10 | $ | 8,000 | $ | 14 | |||||||||||||||
Real estate: | |||||||||||||||||||||||||||||||
Construction | 3,101 | 31 | 4,325 | 40 | 3,688 | 101 | 4,514 | 152 | |||||||||||||||||||||||
Residential mortgage | 22,299 | 201 | 24,946 | 78 | 22,272 | 195 | 26,695 | 64 | |||||||||||||||||||||||
Home equity | 659 | 5 | 520 | 9 | 630 | 18 | 550 | 17 | |||||||||||||||||||||||
Commercial mortgage | 8,091 | 51 | 8,464 | 15 | 9,006 | 122 | 15,884 | 354 | |||||||||||||||||||||||
Total | $ | 36,197 | $ | 288 | $ | 41,699 | $ | 146 | $ | 37,478 | $ | 446 | $ | 55,643 | $ | 601 |
(dollars in thousands) | Accruing Loans 30 - 59 Days Past Due | Accruing Loans 60 - 89 Days Past Due | Accruing Loans Greater Than 90 Days Past Due | Nonaccrual Loans | Total Past Due and Nonaccrual | Loans and Leases Not Past Due | Total | ||||||||||||||||||||
September 30, 2016 | |||||||||||||||||||||||||||
Commercial, financial & agricultural | $ | 486 | $ | 115 | $ | — | $ | 2,005 | $ | 2,606 | $ | 505,378 | $ | 507,984 | |||||||||||||
Real estate: | |||||||||||||||||||||||||||
Construction | — | — | — | — | — | 108,228 | 108,228 | ||||||||||||||||||||
Residential mortgage | — | 578 | 200 | 5,424 | 6,202 | 1,154,539 | 1,160,741 | ||||||||||||||||||||
Home equity | 33 | 1,182 | — | 479 | 1,694 | 349,562 | 351,256 | ||||||||||||||||||||
Commercial mortgage | 972 | — | — | 2,967 | 3,939 | 858,778 | 862,717 | ||||||||||||||||||||
Consumer: | |||||||||||||||||||||||||||
Automobiles | 696 | 273 | 131 | — | 1,100 | 216,426 | 217,526 | ||||||||||||||||||||
Other consumer | 491 | 324 | 106 | — | 921 | 229,525 | 230,446 | ||||||||||||||||||||
Leases | — | — | — | — | — | 756 | 756 | ||||||||||||||||||||
Total | $ | 2,678 | $ | 2,472 | $ | 437 | $ | 10,875 | $ | 16,462 | $ | 3,423,192 | $ | 3,439,654 |
(dollars in thousands) | Accruing Loans 30 - 59 Days Past Due | Accruing Loans 60 - 89 Days Past Due | Accruing Loans Greater Than 90 Days Past Due | Nonaccrual Loans | Total Past Due and Nonaccrual | Loans and Leases Not Past Due | Total | ||||||||||||||||||||
December 31, 2015 | |||||||||||||||||||||||||||
Commercial, financial & agricultural | $ | 276 | $ | 140 | $ | — | $ | 1,044 | $ | 1,460 | $ | 519,626 | $ | 521,086 | |||||||||||||
Real estate: | |||||||||||||||||||||||||||
Construction | — | — | — | — | — | 84,885 | 84,885 | ||||||||||||||||||||
Residential mortgage | 3,134 | 325 | — | 5,464 | 8,923 | 1,125,402 | 1,134,325 | ||||||||||||||||||||
Home equity | 700 | 220 | — | 666 | 1,586 | 300,394 | 301,980 | ||||||||||||||||||||
Commercial mortgage | 54 | — | — | 7,094 | 7,148 | 753,601 | 760,749 | ||||||||||||||||||||
Consumer: | |||||||||||||||||||||||||||
Automobiles | 912 | 168 | 151 | — | 1,231 | 188,971 | 190,202 | ||||||||||||||||||||
Other consumer | 531 | 353 | 122 | — | 1,006 | 216,271 | 217,277 | ||||||||||||||||||||
Leases | — | — | — | — | — | 1,028 | 1,028 | ||||||||||||||||||||
Total | $ | 5,607 | $ | 1,206 | $ | 273 | $ | 14,268 | $ | 21,354 | $ | 3,190,178 | $ | 3,211,532 |
(dollars in thousands) | Number of Contracts | Recorded Investment (as of Period End) | Increase in the Allowance | |||||||
Three Months Ended September 30, 2016 | ||||||||||
Real estate: Residential mortgage | 3 | 289 | — | |||||||
Nine Months Ended September 30, 2016 | ||||||||||
Real estate: Residential mortgage | 3 | 289 | — | |||||||
Nine Months Ended September 30, 2015 | ||||||||||
Commercial, financial & agricultural | 1 | $ | 512 | $ | — | |||||
Real estate: Commercial mortgage | 1 | 957 | — | |||||||
Total | 2 | $ | 1,469 | $ | — |
(dollars in thousands) | Pass | Special Mention | Substandard | Loss | Subtotal | Net Deferred Costs (Income) | Total | ||||||||||||||||||||
September 30, 2016 | |||||||||||||||||||||||||||
Commercial, financial & agricultural | $ | 501,119 | $ | 3,765 | $ | 2,689 | $ | — | $ | 507,573 | $ | 411 | $ | 507,984 | |||||||||||||
Real estate: | |||||||||||||||||||||||||||
Construction | 98,740 | 9,670 | 47 | — | 108,457 | (229 | ) | 108,228 | |||||||||||||||||||
Residential mortgage | 1,152,179 | 111 | 5,624 | — | 1,157,914 | 2,827 | 1,160,741 | ||||||||||||||||||||
Home equity | 348,079 | 2,700 | 479 | — | 351,258 | (2 | ) | 351,256 | |||||||||||||||||||
Commercial mortgage | 827,005 | 20,569 | 16,106 | — | 863,680 | (963 | ) | 862,717 | |||||||||||||||||||
Consumer: | |||||||||||||||||||||||||||
Automobiles | 217,289 | — | 131 | 106 | 217,526 | — | 217,526 | ||||||||||||||||||||
Other consumer | 230,707 | — | 82 | — | 230,789 | (343 | ) | 230,446 | |||||||||||||||||||
Leases | 756 | — | — | — | 756 | — | 756 | ||||||||||||||||||||
Total | $ | 3,375,874 | $ | 36,815 | $ | 25,158 | $ | 106 | $ | 3,437,953 | $ | 1,701 | $ | 3,439,654 | |||||||||||||
December 31, 2015 | |||||||||||||||||||||||||||
Commercial, financial & agricultural | $ | 514,971 | $ | 2,168 | $ | 3,318 | $ | — | $ | 520,457 | $ | 629 | $ | 521,086 | |||||||||||||
Real estate: | |||||||||||||||||||||||||||
Construction | 83,601 | 808 | 787 | — | 85,196 | (311 | ) | 84,885 | |||||||||||||||||||
Residential mortgage | 1,126,418 | — | 5,464 | — | 1,131,882 | 2,443 | 1,134,325 | ||||||||||||||||||||
Home equity | 301,314 | — | 666 | — | 301,980 | — | 301,980 | ||||||||||||||||||||
Commercial mortgage | 705,520 | 41,335 | 14,711 | — | 761,566 | (817 | ) | 760,749 | |||||||||||||||||||
Consumer: | |||||||||||||||||||||||||||
Automobiles | 190,051 | — | 151 | — | 190,202 | — | 190,202 | ||||||||||||||||||||
Other consumer | 217,727 | 95 | — | — | 217,822 | (545 | ) | 217,277 | |||||||||||||||||||
Leases | 1,028 | — | — | — | 1,028 | — | 1,028 | ||||||||||||||||||||
Total | $ | 3,140,630 | $ | 44,406 | $ | 25,097 | $ | — | $ | 3,210,133 | $ | 1,399 | $ | 3,211,532 |
Real Estate | |||||||||||||||||||||||||||||||||||||||
Commercial, Financial & Agricultural | Construction | Residential Mortgage | Home Equity | Commercial Mortgage | Consumer - Auto | Consumer - Other | Leases | Unallocated | Total | ||||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||||||||
Three Months Ended September 30, 2016 | |||||||||||||||||||||||||||||||||||||||
Beginning balance | $ | 4,442 | $ | 3,823 | $ | 14,192 | $ | 3,446 | $ | 27,448 | $ | 2,573 | $ | 2,840 | $ | — | $ | 2,000 | $ | 60,764 | |||||||||||||||||||
Provision (credit) for loan and lease losses | 20 | (1,528 | ) | (451 | ) | 562 | (1,206 | ) | 658 | 1,202 | — | — | (743 | ) | |||||||||||||||||||||||||
4,462 | 2,295 | 13,741 | 4,008 | 26,242 | 3,231 | 4,042 | — | 2,000 | 60,021 | ||||||||||||||||||||||||||||||
Charge-offs | 465 | — | — | — | — | 409 | 940 | — | — | 1,814 | |||||||||||||||||||||||||||||
Recoveries | 555 | 91 | 173 | 4 | 128 | 115 | 111 | — | — | 1,177 | |||||||||||||||||||||||||||||
Net charge-offs (recoveries) | (90 | ) | (91 | ) | (173 | ) | (4 | ) | (128 | ) | 294 | 829 | — | — | 637 | ||||||||||||||||||||||||
Ending balance | $ | 4,552 | $ | 2,386 | $ | 13,914 | $ | 4,012 | $ | 26,370 | $ | 2,937 | $ | 3,213 | $ | — | $ | 2,000 | $ | 59,384 | |||||||||||||||||||
Three Months Ended September 30, 2015 | |||||||||||||||||||||||||||||||||||||||
Beginning balance | $ | 7,569 | $ | 10,670 | $ | 14,932 | $ | 2,914 | $ | 20,008 | $ | 3,410 | $ | 3,920 | $ | 1 | $ | 3,500 | $ | 66,924 | |||||||||||||||||||
Provision (credit) for loan and lease losses | (293 | ) | (2,702 | ) | (144 | ) | 121 | (1,573 | ) | 424 | 548 | (28 | ) | — | (3,647 | ) | |||||||||||||||||||||||
7,276 | 7,968 | 14,788 | 3,035 | 18,435 | 3,834 | 4,468 | (27 | ) | 3,500 | 63,277 | |||||||||||||||||||||||||||||
Charge-offs | 170 | — | — | 46 | — | 299 | 575 | — | — | 1,090 | |||||||||||||||||||||||||||||
Recoveries | 504 | 283 | 191 | 5 | 3,130 | 209 | 108 | 27 | — | 4,457 | |||||||||||||||||||||||||||||
Net charge-offs (recoveries) | (334 | ) | (283 | ) | (191 | ) | 41 | (3,130 | ) | 90 | 467 | (27 | ) | — | (3,367 | ) | |||||||||||||||||||||||
Ending balance | $ | 7,610 | $ | 8,251 | $ | 14,979 | $ | 2,994 | $ | 21,565 | $ | 3,744 | $ | 4,001 | $ | — | $ | 3,500 | $ | 66,644 | |||||||||||||||||||
Real Estate | |||||||||||||||||||||||||||||||||||||||
Commercial, Financial & Agricultural | Construction | Residential Mortgage | Home Equity | Commercial Mortgage | Consumer - Auto | Consumer - Other | Leases | Unallocated | Total | ||||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||||||||
Nine Months Ended September 30, 2016 | |||||||||||||||||||||||||||||||||||||||
Beginning balance | $ | 6,905 | $ | 8,454 | $ | 14,642 | $ | 3,096 | $ | 21,847 | $ | 2,891 | $ | 3,339 | $ | — | $ | 2,140 | $ | 63,314 | |||||||||||||||||||
Provision (credit) for loan and lease losses | (2,888 | ) | (6,177 | ) | (1,119 | ) | 916 | 4,368 | 2,294 | (126 | ) | — | (140 | ) | (2,872 | ) | |||||||||||||||||||||||
4,017 | 2,277 | 13,523 | 4,012 | 26,215 | 5,185 | 3,213 | — | 2,000 | 60,442 | ||||||||||||||||||||||||||||||
Charge-offs | 1,089 | — | — | — | — | 3,596 | — | — | — | 4,685 | |||||||||||||||||||||||||||||
Recoveries | 1,624 | 109 | 391 | — | 155 | 1,348 | — | — | — | 3,627 | |||||||||||||||||||||||||||||
Net charge-offs (recoveries) | (535 | ) | (109 | ) | (391 | ) | — | (155 | ) | 2,248 | — | — | — | 1,058 | |||||||||||||||||||||||||
Ending balance | $ | 4,552 | $ | 2,386 | $ | 13,914 | $ | 4,012 | $ | 26,370 | $ | 2,937 | $ | 3,213 | $ | — | $ | 2,000 | $ | 59,384 | |||||||||||||||||||
Nine Months Ended September 30, 2015 | |||||||||||||||||||||||||||||||||||||||
Beginning balance | $ | 8,954 | $ | 14,969 | $ | 15,031 | $ | 2,896 | $ | 20,869 | $ | 3,373 | $ | 3,941 | $ | 7 | $ | 4,000 | $ | 74,040 | |||||||||||||||||||
Provision (credit) for loan and lease losses | (617 | ) | (7,588 | ) | (1,082 | ) | (843 | ) | (6,009 | ) | 652 | 2,308 | (34 | ) | (500 | ) | (13,713 | ) | |||||||||||||||||||||
8,337 | 7,381 | 13,949 | 2,053 | 14,860 | 4,025 | 6,249 | (27 | ) | 3,500 | 60,327 | |||||||||||||||||||||||||||||
Charge-offs | 5,104 | — | — | 110 | — | 1,046 | 2,883 | — | — | 9,143 | |||||||||||||||||||||||||||||
Recoveries | 4,377 | 870 | 1,030 | 1,051 | 6,705 | 765 | 635 | 27 | — | 15,460 | |||||||||||||||||||||||||||||
Net charge-offs (recoveries) | 727 | (870 | ) | (1,030 | ) | (941 | ) | (6,705 | ) | 281 | 2,248 | (27 | ) | — | (6,317 | ) | |||||||||||||||||||||||
Ending balance | $ | 7,610 | $ | 8,251 | $ | 14,979 | $ | 2,994 | $ | 21,565 | $ | 3,744 | $ | 4,001 | $ | — | $ | 3,500 | $ | 66,644 |
(dollars in thousands) | September 30, 2016 | December 31, 2015 | |||||
Investments in low income housing tax credit partnerships | $ | 3,625 | $ | 2,699 | |||
Trust preferred investments | 2,792 | 2,792 | |||||
Investments in affiliates | 540 | 612 | |||||
Other | 54 | 54 | |||||
Total | $ | 7,011 | $ | 6,157 |
(dollars in thousands) | Three Months Ended September 30, 2016 | Three Months Ended September 30, 2015 | Nine Months Ended September 30, 2016 | Nine Months Ended September 30, 2015 | |||||||||||
Cost method: | |||||||||||||||
Amortization expense recognized in other operating expense | $ | 259 | $ | 258 | $ | 774 | $ | 820 | |||||||
Tax credits recognized in income tax expense | 292 | 293 | 877 | 933 |
(dollars in thousands) | Core Deposit Premium | Mortgage Servicing Rights | Total | ||||||||
Balance, beginning of period | $ | 7,355 | $ | 17,797 | $ | 25,152 | |||||
Additions | — | 2,126 | 2,126 | ||||||||
Amortization | (2,006 | ) | (4,285 | ) | (6,291 | ) | |||||
Balance, end of period | $ | 5,349 | $ | 15,638 | $ | 20,987 |
Nine Months Ended September 30, | |||||||
(dollars in thousands) | 2016 | 2015 | |||||
Fair market value, beginning of period | $ | 18,345 | $ | 19,975 | |||
Fair market value, end of period | 16,025 | 18,495 | |||||
Weighted average discount rate | 9.5 | % | 9.5 | % | |||
Forecasted constant prepayment rate assumption | 16.7 | 14.3 |
September 30, 2016 | December 31, 2015 | ||||||||||||||||||||||
(dollars in thousands) | Gross Carrying Value | Accumulated Amortization | Net Carrying Value | Gross Carrying Value | Accumulated Amortization | Net Carrying Value | |||||||||||||||||
Core deposit premium | $ | 44,642 | $ | (39,293 | ) | $ | 5,349 | $ | 44,642 | $ | (37,287 | ) | $ | 7,355 | |||||||||
Mortgage servicing rights | 61,127 | (45,489 | ) | 15,638 | 59,001 | (41,204 | ) | 17,797 | |||||||||||||||
Total | $ | 105,769 | $ | (84,782 | ) | $ | 20,987 | $ | 103,643 | $ | (78,491 | ) | $ | 25,152 |
Estimated Amortization Expense | |||||||||||
(dollars in thousands) | Core Deposit Premium | Mortgage Servicing Rights | Total | ||||||||
2016 (remainder) | $ | 669 | $ | 917 | $ | 1,586 | |||||
2017 | 2,674 | 3,210 | 5,884 | ||||||||
2018 | 2,006 | 2,510 | 4,516 | ||||||||
2019 | — | 2,055 | 2,055 | ||||||||
2020 | — | 1,688 | 1,688 | ||||||||
2021 | — | 1,427 | 1,427 | ||||||||
Thereafter | — | 3,831 | 3,831 | ||||||||
$ | 5,349 | $ | 15,638 | $ | 20,987 |
Asset Derivatives | Liability Derivatives | |||||||||||||||||
Fair Value at | Fair Value at | |||||||||||||||||
Derivatives Financial Instruments Not Designated as Hedging Instruments | Balance Sheet Location | September 30, 2016 | December 31, 2015 | September 30, 2016 | December 31, 2015 | |||||||||||||
(dollars in thousands) | ||||||||||||||||||
Interest rate lock and forward sale commitments | Other assets / other liabilities | $ | 127 | $ | 68 | $ | 164 | $ | 9 |
Derivatives Financial Instruments Not Designated as Hedging Instruments | Location of Gain (Loss) Recognized in Earnings on Derivatives | Amount of Gain (Loss) Recognized in Earnings on Derivatives | ||||
(dollars in thousands) | ||||||
Three Months Ended September 30, 2016 | ||||||
Interest rate lock and forward sale commitments | Other operating income | $ | 13 | |||
Three Months Ended September 30, 2015 | ||||||
Interest rate lock and forward sale commitments | Other operating income | (646 | ) | |||
Nine Months Ended September 30, 2016 | ||||||
Interest rate lock and forward sale commitments | Other operating income | (95 | ) | |||
Nine Months Ended September 30, 2015 | ||||||
Interest rate lock and forward sale commitments | Other operating income | (378 | ) |
Shares | Weighted Average Grant Date Fair Value | |||||
Non-vested restricted stock awards and units, beginning of period | 463,917 | $ | 17.41 | |||
Changes during the period: | ||||||
Granted | 281,842 | 23.34 | ||||
Vested | (252,729 | ) | 15.81 | |||
Forfeited | (9,101 | ) | 21.41 | |||
Non-vested restricted stock awards and units, end of period | 483,929 | 21.63 |
(dollars in thousands) | Before Tax | Tax Effect | Net of Tax | ||||||||
Three Months Ended September 30, 2016 | |||||||||||
Net unrealized losses on investment securities: | |||||||||||
Net unrealized losses arising during the period | $ | (3,390 | ) | $ | (1,348 | ) | $ | (2,042 | ) | ||
Less: Reclassification adjustment for gains realized in net income | — | — | — | ||||||||
Net unrealized losses on investment securities | (3,390 | ) | (1,348 | ) | (2,042 | ) | |||||
Defined benefit plans: | |||||||||||
Amortization of net actuarial loss | 366 | 123 | 243 | ||||||||
Amortization of net transition obligation | 4 | 1 | 3 | ||||||||
Amortization of prior service cost | 4 | 1 | 3 | ||||||||
Defined benefit plans, net | 374 | 125 | 249 | ||||||||
Other comprehensive loss | $ | (3,016 | ) | $ | (1,223 | ) | $ | (1,793 | ) |
(dollars in thousands) | Before Tax | Tax Effect | Net of Tax | ||||||||
Three Months Ended September 30, 2015 | |||||||||||
Net unrealized gains on investment securities: | |||||||||||
Net unrealized gains arising during the period | $ | 12,561 | $ | 4,998 | $ | 7,563 | |||||
Less: Reclassification adjustment for losses realized in net income | — | — | — | ||||||||
Net unrealized gains on investment securities | 12,561 | 4,998 | 7,563 | ||||||||
Defined benefit plans: | |||||||||||
Amortization of net actuarial loss | 419 | 165 | 254 | ||||||||
Amortization of net transition obligation | 4 | 2 | 2 | ||||||||
Amortization of prior service cost | 5 | 2 | 3 | ||||||||
Defined benefit plans, net | 428 | 169 | 259 | ||||||||
Other comprehensive income | $ | 12,989 | $ | 5,167 | $ | 7,822 |
(dollars in thousands) | Before Tax | Tax Effect | Net of Tax | ||||||||
Nine Months Ended September 30, 2016 | |||||||||||
Net unrealized gains on investment securities: | |||||||||||
Net unrealized gains arising during the period | $ | 26,030 | $ | 10,353 | $ | 15,677 | |||||
Less: Reclassification adjustment for gains realized in net income | — | — | — | ||||||||
Net unrealized gains on investment securities | 26,030 | 10,353 | 15,677 | ||||||||
Defined benefit plans: | |||||||||||
Amortization of net actuarial loss | 1,099 | 371 | 728 | ||||||||
Amortization of net transition obligation | 12 | 3 | 9 | ||||||||
Amortization of prior service cost | 14 | 3 | 11 | ||||||||
Defined benefit plans, net | 1,125 | 377 | 748 | ||||||||
Other comprehensive income | $ | 27,155 | $ | 10,730 | $ | 16,425 | |||||
Nine Months Ended September 30, 2015 | |||||||||||
Net unrealized gains on investment securities: | |||||||||||
Net unrealized gains arising during the period | $ | 3,285 | $ | 1,306 | $ | 1,979 | |||||
Less: Reclassification adjustment for losses realized in net income | 1,866 | 743 | 1,123 | ||||||||
Net unrealized gains on investment securities | 5,151 | 2,049 | 3,102 | ||||||||
Defined benefit plans: | |||||||||||
Amortization of net actuarial loss | 1,260 | 499 | 761 | ||||||||
Amortization of net transition obligation | 12 | 7 | 5 | ||||||||
Amortization of prior service cost | 15 | 6 | 9 | ||||||||
Defined benefit plans, net | 1,287 | 512 | 775 | ||||||||
Other comprehensive income | $ | 6,438 | $ | 2,561 | $ | 3,877 |
(dollars in thousands) | Investment Securities | Defined Benefit Plans | Accumulated Other Comprehensive Income | ||||||||
Three Months Ended September 30, 2016 | |||||||||||
Balance at beginning of period | $ | 26,900 | $ | (8,479 | ) | $ | 18,421 | ||||
Other comprehensive loss before reclassifications | (2,042 | ) | — | (2,042 | ) | ||||||
Amounts reclassified from AOCI | — | 249 | 249 | ||||||||
Total other comprehensive income (loss) | (2,042 | ) | 249 | (1,793 | ) | ||||||
Balance at end of period | $ | 24,858 | $ | (8,230 | ) | $ | 16,628 |
(dollars in thousands) | Investment Securities | Defined Benefit Plans | Accumulated Other Comprehensive Income | ||||||||
Three Months Ended September 30, 2015 | |||||||||||
Balance at beginning of period | $ | 9,125 | $ | (9,911 | ) | $ | (786 | ) | |||
Other comprehensive income before reclassifications | 7,563 | — | 7,563 | ||||||||
Amounts reclassified from AOCI | — | 259 | 259 | ||||||||
Total other comprehensive income | 7,563 | 259 | 7,822 | ||||||||
Balance at end of period | $ | 16,688 | $ | (9,652 | ) | $ | 7,036 |
(dollars in thousands) | Investment Securities | Defined Benefit Plans | Accumulated Other Comprehensive Income | ||||||||
Nine Months Ended September 30, 2016 | |||||||||||
Balance at beginning of period | $ | 9,181 | $ | (8,978 | ) | $ | 203 | ||||
Other comprehensive income before reclassifications | 15,677 | — | 15,677 | ||||||||
Amounts reclassified from AOCI | — | 748 | 748 | ||||||||
Total other comprehensive income | 15,677 | 748 | 16,425 | ||||||||
Balance at end of period | $ | 24,858 | $ | (8,230 | ) | $ | 16,628 |
(dollars in thousands) | Investment Securities | Defined Benefit Plans | Accumulated Other Comprehensive Income | ||||||||
Nine Months Ended September 30, 2015 | |||||||||||
Balance at beginning of period | $ | 13,586 | $ | (10,427 | ) | $ | 3,159 | ||||
Other comprehensive income before reclassifications | 1,979 | — | 1,979 | ||||||||
Amounts reclassified from AOCI | 1,123 | 775 | 1,898 | ||||||||
Total other comprehensive income | 3,102 | 775 | 3,877 | ||||||||
Balance at end of period | $ | 16,688 | $ | (9,652 | ) | $ | 7,036 |
Amount Reclassified from AOCI | Affected Line Item in the Statement Where Net Income is Presented | ||||||||
Details about AOCI Components | Three months ended September 30, | ||||||||
(dollars in thousands) | 2016 | 2015 | |||||||
Amortization of defined benefit retirement and supplemental executive retirement plan items | |||||||||
Net actuarial loss | $ | (366 | ) | $ | (419 | ) | (1) | ||
Net transition obligation | (4 | ) | (4 | ) | (1) | ||||
Prior service cost | (4 | ) | (5 | ) | (1) | ||||
(374 | ) | (428 | ) | Total before tax | |||||
125 | 169 | Tax benefit | |||||||
Total reclassifications for the period | $ | (249 | ) | $ | (259 | ) | Net of tax |
Amount Reclassified from AOCI | Affected Line Item in the Statement Where Net Income is Presented | ||||||||
Details about AOCI Components | Nine months ended September 30, | ||||||||
(dollars in thousands) | 2016 | 2015 | |||||||
Sale of investment securities available for sale | $ | — | $ | (1,866 | ) | Investment securities losses | |||
— | 743 | Tax benefit | |||||||
$ | — | $ | (1,123 | ) | Net of tax | ||||
Amortization of defined benefit retirement and supplemental executive retirement plan items | |||||||||
Net actuarial loss | $ | (1,099 | ) | $ | (1,260 | ) | (1) | ||
Net transition obligation | (12 | ) | (12 | ) | (1) | ||||
Prior service cost | (14 | ) | (15 | ) | (1) | ||||
(1,125 | ) | (1,287 | ) | Total before tax | |||||
377 | 512 | Tax benefit | |||||||
$ | (748 | ) | $ | (775 | ) | Net of tax | |||
Total reclassifications for the period | $ | (748 | ) | $ | (1,898 | ) | Net of tax |
(1) | These accumulated other comprehensive income components are included in the computation of net periodic pension cost (see Note 14 for additional details). |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
(dollars in thousands) | 2016 | 2015 | 2016 | 2015 | |||||||||||
Interest cost | $ | 343 | $ | 349 | $ | 1,030 | $ | 1,045 | |||||||
Expected return on plan assets | (438 | ) | (471 | ) | (1,316 | ) | (1,415 | ) | |||||||
Amortization of net actuarial loss | 353 | 392 | 1,061 | 1,178 | |||||||||||
Net periodic cost | $ | 258 | $ | 270 | $ | 775 | $ | 808 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
(dollars in thousands) | 2016 | 2015 | 2016 | 2015 | |||||||||||
Interest cost | $ | 117 | $ | 110 | $ | 350 | $ | 330 | |||||||
Amortization of net actuarial loss | 13 | 27 | 38 | 82 | |||||||||||
Amortization of net transition obligation | 4 | 4 | 12 | 12 | |||||||||||
Amortization of prior service cost | 4 | 5 | 14 | 15 | |||||||||||
Net periodic cost | $ | 138 | $ | 146 | $ | 414 | $ | 439 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
(dollars in thousands, except per share data) | 2016 | 2015 | 2016 | 2015 | |||||||||||
Net income | $ | 11,466 | $ | 12,206 | $ | 34,784 | $ | 34,936 | |||||||
Weighted average shares outstanding - basic | 30,943,756 | 31,330,964 | 31,088,729 | 32,548,479 | |||||||||||
Dilutive effect of employee stock options and awards | 198,372 | 418,916 | 188,673 | 383,868 | |||||||||||
Weighted average shares outstanding - diluted | 31,142,128 | 31,749,880 | 31,277,402 | 32,932,347 | |||||||||||
Basic earnings per common share | $ | 0.37 | $ | 0.39 | $ | 1.12 | $ | 1.07 | |||||||
Diluted earnings per common share | $ | 0.37 | $ | 0.38 | $ | 1.11 | $ | 1.06 |
Fair Value Measurement Using | |||||||||||||||||||
(dollars in thousands) | Carrying Amount | Estimated Fair Value | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||||
September 30, 2016 | |||||||||||||||||||
Financial assets | |||||||||||||||||||
Cash and due from banks | $ | 79,647 | $ | 79,647 | $ | 79,647 | $ | — | $ | — | |||||||||
Interest-bearing deposits in other banks | 23,727 | 23,727 | 23,727 | — | — | ||||||||||||||
Investment securities | 1,488,797 | 1,492,753 | 784 | 1,478,936 | 13,033 | ||||||||||||||
Loans held for sale | 12,755 | 12,755 | — | 12,755 | — | ||||||||||||||
Net loans and leases | 3,380,270 | 3,373,145 | — | 35,056 | 3,338,089 | ||||||||||||||
Federal Home Loan Bank stock | 12,173 | 12,173 | 12,173 | — | — | ||||||||||||||
Accrued interest receivable | 14,554 | 14,554 | 14,554 | — | — | ||||||||||||||
Financial liabilities | |||||||||||||||||||
Deposits: | |||||||||||||||||||
Noninterest-bearing demand | 1,194,557 | 1,194,557 | 1,194,557 | — | — | ||||||||||||||
Interest-bearing demand and savings and money market | 2,228,612 | 2,228,612 | 2,228,612 | — | — | ||||||||||||||
Time | 1,095,409 | 1,096,107 | — | — | 1,096,107 | ||||||||||||||
Short-term borrowings | 150,000 | 150,000 | — | 150,000 | — | ||||||||||||||
Long-term debt | 92,785 | 66,210 | — | 66,210 | — | ||||||||||||||
Accrued interest payable (included in other liabilities) | 1,449 | 1,449 | 1,449 | — | — | ||||||||||||||
Off-balance sheet financial instruments | |||||||||||||||||||
Commitments to extend credit | 846,660 | 1,095 | — | 1,095 | — | ||||||||||||||
Standby letters of credit and financial guarantees written | 15,644 | 235 | — | 235 | — | ||||||||||||||
Derivatives: | |||||||||||||||||||
Interest rate lock commitments | 20,414 | 90 | — | 90 | — | ||||||||||||||
Forward sale commitments | 32,399 | (127 | ) | — | (127 | ) | — |
Fair Value Measurement Using | |||||||||||||||||||
(dollars in thousands) | Carrying Amount | Estimated Fair Value | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||||
December 31, 2015 | |||||||||||||||||||
Financial assets | |||||||||||||||||||
Cash and due from banks | $ | 71,797 | $ | 71,797 | $ | 71,797 | $ | — | $ | — | |||||||||
Interest-bearing deposits in other banks | 8,397 | 8,397 | 8,397 | — | — | ||||||||||||||
Investment securities | 1,520,172 | 1,516,391 | 916 | 1,502,996 | 12,479 | ||||||||||||||
Loans held for sale | 14,109 | 14,109 | — | 14,109 | — | ||||||||||||||
Net loans and leases | 3,148,218 | 3,094,404 | — | 38,205 | 3,056,199 | ||||||||||||||
Federal Home Loan Bank stock | 8,606 | 8,606 | 8,606 | — | — | ||||||||||||||
Accrued interest receivable | 14,898 | 14,898 | 14,898 | — | — | ||||||||||||||
Financial liabilities | |||||||||||||||||||
Deposits: | |||||||||||||||||||
Noninterest-bearing demand | 1,145,244 | 1,145,244 | 1,145,244 | — | — | ||||||||||||||
Interest-bearing demand and savings and money market | 2,223,988 | 2,223,988 | 2,223,988 | — | — | ||||||||||||||
Time | 1,064,207 | 1,064,255 | — | — | 1,064,255 | ||||||||||||||
Short-term borrowings | 69,000 | 69,000 | — | 69,000 | — | ||||||||||||||
Long-term debt | 92,785 | 67,421 | — | 67,421 | — | ||||||||||||||
Accrued interest payable (included in other liabilities) | 1,072 | 1,072 | 1,072 | — | — | ||||||||||||||
Off-balance sheet financial instruments | |||||||||||||||||||
Commitments to extend credit | 801,835 | 1,014 | — | 1,014 | — | ||||||||||||||
Standby letters of credit and financial guarantees written | 13,434 | 202 | — | 202 | — | ||||||||||||||
Derivatives: | |||||||||||||||||||
Interest rate lock commitments | 24,009 | 43 | — | 43 | — | ||||||||||||||
Forward sale commitments | 9,973 | 15 | — | 15 | — |
• | Level 1 — Valuation is based upon quoted prices (unadjusted) for identical assets or liabilities traded in active markets. A quoted price in an active market provides the most reliable evidence of fair value and shall be used to measure fair value whenever available. |
• | Level 2 — Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market. |
• | Level 3 — Valuation is generated from model-based techniques that use significant assumptions not observable in the market. These unobservable assumptions reflect our own estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques include use of discounted cash flow models and similar techniques that requires the use of significant judgment or estimation. |
Fair Value at Reporting Date Using | |||||||||||||||
(dollars in thousands) | Fair Value | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||
September 30, 2016 | |||||||||||||||
Available for sale securities: | |||||||||||||||
Debt securities: | |||||||||||||||
States and political subdivisions | $ | 191,778 | $ | — | $ | 178,745 | $ | 13,033 | |||||||
Corporate securities | 109,608 | — | 109,608 | — | |||||||||||
Mortgage-backed securities: | |||||||||||||||
Residential - U.S. Government sponsored entities | 759,203 | — | 759,203 | — | |||||||||||
Residential - Non-government agencies | 57,622 | — | 57,622 | — | |||||||||||
Commercial - Non-government agencies | 143,229 | — | 143,229 | — | |||||||||||
Other | 784 | 784 | — | — | |||||||||||
Total available for sale securities | 1,262,224 | 784 | 1,248,407 | 13,033 | |||||||||||
Derivatives - Interest rate lock and forward sale commitments | (37 | ) | — | (37 | ) | — | |||||||||
Total | $ | 1,262,187 | $ | 784 | $ | 1,248,370 | $ | 13,033 |
Fair Value at Reporting Date Using | |||||||||||||||
(dollars in thousands) | Fair Value | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||
December 31, 2015 | |||||||||||||||
Available for sale securities: | |||||||||||||||
Debt securities: | |||||||||||||||
States and political subdivisions | $ | 190,473 | $ | — | $ | 177,994 | $ | 12,479 | |||||||
Corporate securities | 108,571 | — | 108,571 | — | |||||||||||
Mortgage-backed securities: | |||||||||||||||
Residential - U.S. Government sponsored entities | 771,909 | — | 771,909 | — | |||||||||||
Residential - Non-government agencies | 64,032 | — | 64,032 | — | |||||||||||
Commercial - Non-government agencies | 136,354 | — | 136,354 | — | |||||||||||
Other | 916 | 916 | — | — | |||||||||||
Total available for sale securities | 1,272,255 | 916 | 1,258,860 | 12,479 | |||||||||||
Derivatives - Interest rate lock and forward sale commitments | 59 | — | 59 | — | |||||||||||
Total | $ | 1,272,314 | $ | 916 | $ | 1,258,919 | $ | 12,479 |
(dollars in thousands) | Available for Sale Debt Securities: States and Political Subdivisions | ||
Balance at December 31, 2015 | $ | 12,479 | |
Principal payments received | (268 | ) | |
Unrealized net gain included in other comprehensive income | 822 | ||
Balance at September 30, 2016 | $ | 13,033 | |
Balance at December 31, 2014 | $ | 13,095 | |
Principal payments received | (897 | ) | |
Unrealized net gain included in other comprehensive income | 554 | ||
Balance at September 30, 2015 | $ | 12,752 |
Fair Value Measurements Using | |||||||||||||||
(dollars in thousands) | Fair Value | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||
September 30, 2016 | |||||||||||||||
Impaired loans (1) | $ | 35,051 | $ | — | $ | 35,051 | $ | — | |||||||
Other real estate (2) | 791 | — | 791 | — | |||||||||||
December 31, 2015 | |||||||||||||||
Impaired loans (1) | $ | 38,153 | $ | — | $ | 38,153 | $ | — | |||||||
Other real estate (2) | 1,962 | — | 1,962 | — |
(1) | Represents carrying value and related write-downs of loans for which adjustments are based on agreed upon purchase prices for the loans or the appraised value of the collateral. |
(2) | Represents other real estate that is carried at the lower of carrying value or fair value less costs to sell. Fair value is generally based upon independent market prices or appraised values of the collateral. |
(dollars in thousands) | Banking Operations | Treasury | All Others | Total | |||||||||||
Three Months Ended September 30, 2016 | |||||||||||||||
Net interest income | $ | 32,583 | $ | 6,843 | $ | — | $ | 39,426 | |||||||
Inter-segment net interest income (expense) | 8,588 | (6,398 | ) | (2,190 | ) | — | |||||||||
Credit for loan and lease losses | 743 | — | — | 743 | |||||||||||
Other operating income | 6,833 | 652 | 3,490 | 10,975 | |||||||||||
Other operating expense | (15,875 | ) | (410 | ) | (17,001 | ) | (33,286 | ) | |||||||
Administrative and overhead expense allocation | (14,873 | ) | (253 | ) | 15,126 | — | |||||||||
Income before taxes | 17,999 | 434 | (575 | ) | 17,858 | ||||||||||
Income tax (expense) benefit | (6,452 | ) | (162 | ) | 222 | (6,392 | ) | ||||||||
Net income (loss) | $ | 11,547 | $ | 272 | $ | (353 | ) | $ | 11,466 |
(dollars in thousands) | Banking Operations | Treasury | All Others | Total | |||||||||||
Three Months Ended September 30, 2015 | |||||||||||||||
Net interest income | $ | 29,424 | $ | 8,381 | $ | — | $ | 37,805 | |||||||
Inter-segment net interest income (expense) | 11,176 | (7,477 | ) | (3,699 | ) | — | |||||||||
Credit for loan and lease losses | 3,647 | — | — | 3,647 | |||||||||||
Other operating income | 5,438 | 734 | 3,657 | 9,829 | |||||||||||
Other operating expense | (14,291 | ) | (436 | ) | (17,448 | ) | (32,175 | ) | |||||||
Administrative and overhead expense allocation | (15,798 | ) | (245 | ) | 16,043 | — | |||||||||
Income before taxes | 19,596 | 957 | (1,447 | ) | 19,106 | ||||||||||
Income tax (expense) benefit | (6,859 | ) | (335 | ) | 294 | (6,900 | ) | ||||||||
Net income (loss) | $ | 12,737 | $ | 622 | $ | (1,153 | ) | $ | 12,206 |
(dollars in thousands) | Banking Operations | Treasury | All Others | Total | |||||||||||
Nine Months Ended September 30, 2016 | |||||||||||||||
Net interest income | $ | 95,519 | $ | 22,727 | $ | — | $ | 118,246 | |||||||
Inter-segment net interest income (expense) | 28,581 | (20,315 | ) | (8,266 | ) | — | |||||||||
Credit for loan and lease losses | 2,872 | — | — | 2,872 | |||||||||||
Other operating income | 18,860 | 2,794 | 11,178 | 32,832 | |||||||||||
Other operating expense | (45,522 | ) | (1,237 | ) | (53,617 | ) | (100,376 | ) | |||||||
Administrative and overhead expense allocation | (43,014 | ) | (643 | ) | 43,657 | — | |||||||||
Income before taxes | 57,296 | 3,326 | (7,048 | ) | 53,574 | ||||||||||
Income tax (expense) benefit | (20,095 | ) | (1,167 | ) | 2,472 | (18,790 | ) | ||||||||
Net income (loss) | $ | 37,201 | $ | 2,159 | $ | (4,576 | ) | $ | 34,784 |
(dollars in thousands) | Banking Operations | Treasury | All Others | Total | |||||||||||
Nine Months Ended September 30, 2015 | |||||||||||||||
Net interest income | $ | 86,115 | $ | 25,219 | $ | — | $ | 111,334 | |||||||
Inter-segment net interest income (expense) | 32,826 | (24,242 | ) | (8,584 | ) | — | |||||||||
Credit for loan and lease losses | 13,713 | — | — | 13,713 | |||||||||||
Other operating income | 17,892 | 439 | 10,812 | 29,143 | |||||||||||
Other operating expense | (44,469 | ) | (1,407 | ) | (52,775 | ) | (98,651 | ) | |||||||
Administrative and overhead expense allocation | (43,839 | ) | (799 | ) | 44,638 | — | |||||||||
Income before taxes | 62,238 | (790 | ) | (5,909 | ) | 55,539 | |||||||||
Income tax (expense) benefit | (21,783 | ) | 276 | 904 | (20,603 | ) | |||||||||
Net income | $ | 40,455 | $ | (514 | ) | $ | (5,005 | ) | $ | 34,936 |
(dollars in thousands) | Banking Operations | Treasury | All Others | Total | |||||||||||
At September 30, 2016: | |||||||||||||||
Investment securities | $ | — | $ | 1,488,797 | $ | — | $ | 1,488,797 | |||||||
Loans and leases (including loans held for sale) | 3,452,409 | — | — | 3,452,409 | |||||||||||
Other | 43,760 | 251,999 | 82,982 | 378,741 | |||||||||||
Total assets | $ | 3,496,169 | $ | 1,740,796 | $ | 82,982 | $ | 5,319,947 |
(dollars in thousands) | Banking Operations | Treasury | All Others | Total | |||||||||||
At December 31, 2015: | |||||||||||||||
Investment securities | $ | — | $ | 1,520,172 | $ | — | $ | 1,520,172 | |||||||
Loans and leases (including loans held for sale) | 3,225,641 | — | — | 3,225,641 | |||||||||||
Other | 74,963 | 226,172 | 84,340 | 385,475 | |||||||||||
Total assets | $ | 3,300,604 | $ | 1,746,344 | $ | 84,340 | $ | 5,131,288 |
Loan Segment | Proxy - Moody’s Loss Rate | |
Commercial, Financial and Agricultural | Maximum of Last 5 Yrs’ Annual Corporate Bond Loss Rate | |
Construction | Cumulative 2-Yr U.S. CMBS Loss Rate | |
Commercial Mortgage | Cumulative 2-Yr U.S. CMBS Loss Rate | |
Residential Mortgage | Cumulative 2-Yr U.S. RMBS/HEL Loss Rate | |
Consumer | 1-Yr U.S. ABS excl. HEL Loss Rate | |
Leases | Maximum of Last 5 Yrs’ Annual Corporate Bond Loss Rate |
• | In the second quarter 2012, adjustment factors were added to the Pass- and Special Mention-rated commercial mortgage segments in consideration of the refinance risk associated with loans maturing over the next two years. Adjustment factors were not added to Substandard-rated loans due to the enhanced level of monitoring devoted to these credits, with impairment analysis performed as indicated. |
• | In the second quarter 2012, an adjustment factor was added in recognition of the delegation of increased credit authority to Line Division Management and changes in the underwriting and approval process for small business lending. This change involved moving from a judgmental underwriting process for all loans to a score-based approval process below a certain loan size threshold, and a streamlined judgmental process augmented by relationship officer involvement above a certain loan size threshold. This adjustment factor was subsequently removed in the fourth quarter of 2015. |
• | In the first quarter of 2013, an adjustment factor was added to the Pass-rated residential mortgage segment in consideration of emerging concentration risk. In addition, “benchmark” loss rates were applied to loans generated via recent pre-approved and invitation to apply promotions in the direct consumer segment until historical loss data had been accumulated. Also, weighted adjustment factors were applied to the syndicated loan portfolio based on Moody’s proxy default rates to account for increased risk associated with recent entrance into this sector and risk exposure attributed to the size of individual credits. |
• | In the second quarter of 2013, an adjustment factor was subtracted from the Pass-rated residential mortgage segment in consideration of the continued disparity between actual calculated historical loss rates and those provided by our primary regulator in 2010. |
• | In the third quarter of 2013, we purchased the first student loan pool. The expected loss rates were applied to the student loans in the direct consumer segment until historical loss data has been accumulated for this loan segment. |
• | In the first quarter of 2014, the refinance risk qualitative adjustment factors for commercial mortgages were discontinued as the extension of the historical loss look-back period is deemed to capture a majority of the segment’s refinance risk through the incorporation of more comprehensive economic data. |
• | In the first quarter of 2014, the previous methodology for Pass-rated residential mortgage sub-sectors based on guidance from our primary regulator in 2010 was discontinued in order to better reflect the bank’s current exposure and actual loss experience. The Company deems the bank’s actual loss experience to be more reflective of current portfolio conditions. |
• | In the first quarter of 2014, in consideration of portfolio concentration risk, benchmark adjustment factors were added to the Pass- and Special Mention-rated sub-sectors of segments with loan balances comprising greater than 20% of the total loan portfolio. The benchmark adjustment factors consider segment-specific annual loss rates over the economic cycle in order to determine a loss rate that adequately captures concentration risk. In the first quarter of 2014, the benchmark adjustment factors affected the Pass-rated residential mortgage and commercial mortgage segments. |
• | In the fourth quarter of 2014, the Company determined that it was appropriate to separate U.S. Mainland commercial mortgages from Hawaii commercial mortgages for purposes of calculating concentration risk. In making this assessment, the Company considered the regulatory guidance and concluded that the U.S. Mainland commercial mortgages were no longer similar in credit performance to the credit performance of the Hawaii commercial mortgages such that they would necessarily “perform like a single large exposure.” This is supported by a correlation analysis conducted by the Company. In light of the statistical evidence demonstrating the reduced dependency between the credit performance of the two segments, the Company concluded that the U.S. Mainland commercial mortgage segment should not be included with the Hawaii commercial mortgage segment for the determination of portfolio concentration. |
• | In the fourth quarter of 2014, the Company adopted a time based graduated scale to reduce reliance on benchmark data by substituting our emerging actual experience in the pre-approved consumer loan and student loan portfolios of the consumer loan segment. |
• | In the fourth quarter of 2014, the Company replaced a Moody’s proxy loss rate designed to compensate for the large size of the individual loans and lack of experience with a qualitative factor based on the Company’s emerging experience in the syndicated loan portfolio. The portfolio has begun to season and within the one year look-back period, we experienced a loss. The Company considers it prudent to augment the emerging experience of this portfolio with qualitative factors that are intended to compensate for lack of sufficient historical experience. |
• | In the first and second quarters of 2015, we increased a qualitative factor applied to our national syndicated loan portfolio in consideration of updated proxy information which became available in the first quarter of 2015 and better defined portfolio attributes during the second quarter of 2015. |
• | In the third quarter of 2015, the Company enhanced its reasonableness review of the economic/market conditions qualitative factor and, if necessary, will adjust this factor to ensure directional consistency. |
• | No material enhancements were made during the nine months ended September 30, 2016. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Return on average assets | 0.87 | % | 0.98 | % | 0.89 | % | 0.94 | % | |||||||
Return on average shareholders’ equity | 8.81 | 9.91 | 9.05 | 8.98 | |||||||||||
Basic earnings per common share | $ | 0.37 | $ | 0.39 | $ | 1.12 | $ | 1.07 | |||||||
Diluted earnings per common share | 0.37 | 0.38 | 1.11 | 1.06 |
(dollars in thousands) | Three Months Ended September 30, | |||||||||||||||||||||||||||||||
2016 | 2015 | Variance | ||||||||||||||||||||||||||||||
Average Balance | Average Yield/ Rate | Interest Income/ Expense | Average Balance | Average Yield/ Rate | Interest Income/ Expense | Average Balance | Average Yield/ Rate | Interest Income/ Expense | ||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||
Interest earning assets: | ||||||||||||||||||||||||||||||||
Interest-bearing deposits in other banks | $ | 14,140 | 0.49 | % | 17 | $ | 10,277 | 0.23 | % | 6 | $ | 3,863 | 0.26 | % | 11 | |||||||||||||||||
Investment securities, excluding valuation allowance: | ||||||||||||||||||||||||||||||||
Taxable (1) | 1,288,569 | 2.27 | 7,306 | 1,345,120 | 2.46 | 8,269 | (56,551 | ) | (0.19 | ) | (963 | ) | ||||||||||||||||||||
Tax-exempt (1) | 172,743 | 3.54 | 1,531 | 175,340 | 3.54 | 1,551 | (2,597 | ) | — | (20 | ) | |||||||||||||||||||||
Total investment securities | 1,461,312 | 2.42 | 8,837 | 1,520,460 | 2.58 | 9,820 | (59,148 | ) | (0.16 | ) | (983 | ) | ||||||||||||||||||||
Loans and leases, including loans held for sale (2) | 3,415,505 | 3.90 | 33,384 | 3,070,384 | 3.91 | 30,148 | 345,121 | (0.01 | ) | 3,236 | ||||||||||||||||||||||
Federal Home Loan Bank stock | 11,194 | 2.25 | 63 | 10,113 | 0.42 | 11 | 1,081 | 1.83 | 52 | |||||||||||||||||||||||
Total interest earning assets | 4,902,151 | 3.44 | 42,301 | 4,611,234 | 3.46 | 39,985 | 290,917 | (0.02 | ) | 2,316 | ||||||||||||||||||||||
Noninterest-earning assets | 364,437 | 362,920 | 1,517 | |||||||||||||||||||||||||||||
Total assets | $ | 5,266,588 | $ | 4,974,154 | $ | 292,434 | ||||||||||||||||||||||||||
Liabilities and Equity | ||||||||||||||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||||||||||||
Interest-bearing demand deposits | $ | 851,775 | 0.06 | % | 126 | $ | 803,682 | 0.05 | % | 104 | $ | 48,093 | 0.01 | % | 22 | |||||||||||||||||
Savings and money market deposits | 1,367,459 | 0.07 | 254 | 1,277,480 | 0.07 | 230 | 89,979 | — | 24 | |||||||||||||||||||||||
Time deposits under $100,000 | 202,719 | 0.37 | 190 | 223,550 | 0.36 | 203 | (20,831 | ) | 0.01 | (13 | ) | |||||||||||||||||||||
Time deposits $100,000 and over | 892,188 | 0.38 | 854 | 842,362 | 0.17 | 365 | 49,826 | 0.21 | 489 | |||||||||||||||||||||||
Total interest-bearing deposits | 3,314,141 | 0.17 | 1,424 | 3,147,074 | 0.11 | 902 | 167,067 | 0.06 | 522 | |||||||||||||||||||||||
Short-term borrowings | 125,408 | 0.50 | 160 | 106,625 | 0.27 | 73 | 18,783 | 0.23 | 87 | |||||||||||||||||||||||
Long-term debt | 92,785 | 3.24 | 755 | 92,785 | 2.83 | 662 | — | 0.41 | 93 | |||||||||||||||||||||||
Total interest-bearing liabilities | 3,532,334 | 0.26 | 2,339 | 3,346,484 | 0.19 | 1,637 | 185,850 | 0.07 | 702 | |||||||||||||||||||||||
Noninterest-bearing deposits | 1,171,923 | 1,094,969 | 76,954 | |||||||||||||||||||||||||||||
Other liabilities | 41,558 | 40,018 | 1,540 | |||||||||||||||||||||||||||||
Total liabilities | 4,745,815 | 4,481,471 | 264,344 | |||||||||||||||||||||||||||||
Shareholders’ equity | 520,757 | 492,683 | 28,074 | |||||||||||||||||||||||||||||
Non-controlling interest | 16 | — | 16 | |||||||||||||||||||||||||||||
Total equity | 520,773 | 492,683 | 28,090 | |||||||||||||||||||||||||||||
Total liabilities and equity | $ | 5,266,588 | $ | 4,974,154 | $ | 292,434 | ||||||||||||||||||||||||||
Net interest income | $ | 39,962 | $ | 38,348 | $ | 1,614 | ||||||||||||||||||||||||||
Interest rate spread | 3.18 | % | 3.27 | % | (0.09 | )% | ||||||||||||||||||||||||||
Net interest margin | 3.25 | % | 3.31 | % | (0.06 | )% | ||||||||||||||||||||||||||
(1) At amortized cost. | ||||||||||||||||||||||||||||||||
(2) Includes nonaccrual loans. |
Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||
2016 | 2015 | Variance | ||||||||||||||||||||||||||||||
Average Balance | Average Yield/ Rate | Interest Income/ Expense | Average Balance | Average Yield/ Rate | Interest Income/ Expense | Average Balance | Average Yield/ Rate | Interest Income/ Expense | ||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||
Interest earning assets: | ||||||||||||||||||||||||||||||||
Interest-bearing deposits in other banks | $ | 12,365 | 0.48 | % | 45 | $ | 15,133 | 0.24 | % | 28 | $ | (2,768 | ) | 0.24 | % | 17 | ||||||||||||||||
Investment securities, excluding valuation allowance: | ||||||||||||||||||||||||||||||||
Taxable investment securities (1) | 1,312,866 | 2.40 | 23,675 | 1,338,836 | 2.46 | 24,713 | (25,970 | ) | (0.06 | ) | (1,038 | ) | ||||||||||||||||||||
Tax-exempt investment securities (1) | 173,392 | 3.53 | 4,593 | 176,335 | 3.51 | 4,640 | (2,943 | ) | 0.02 | (47 | ) | |||||||||||||||||||||
Total investment securities | 1,486,258 | 2.54 | 28,268 | 1,515,171 | 2.58 | 29,353 | (28,913 | ) | (0.04 | ) | (1,085 | ) | ||||||||||||||||||||
Loans and leases, including loans held for sale (2) | 3,350,817 | 3.91 | 98,055 | 3,002,785 | 3.93 | 88,322 | 348,032 | (0.02 | ) | 9,733 | ||||||||||||||||||||||
Federal Home Loan Bank stock | 10,317 | 1.59 | 123 | 28,532 | 0.19 | 40 | (18,215 | ) | 1.40 | 83 | ||||||||||||||||||||||
Total interest earning assets | 4,859,757 | 3.47 | 126,491 | 4,561,621 | 3.45 | 117,743 | 298,136 | 0.02 | 8,748 | |||||||||||||||||||||||
Noninterest-earning assets | 361,549 | 375,914 | (14,365 | ) | ||||||||||||||||||||||||||||
Total assets | $ | 5,221,306 | $ | 4,937,535 | $ | 283,771 | ||||||||||||||||||||||||||
Liabilities and Equity | ||||||||||||||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||||||||||||
Interest-bearing demand deposits | $ | 841,002 | 0.06 | % | 360 | $ | 801,304 | 0.05 | % | 298 | $ | 39,698 | 0.01 | % | 62 | |||||||||||||||||
Savings and money market deposits | 1,410,159 | 0.07 | 786 | 1,261,534 | 0.07 | 678 | 148,625 | — | 108 | |||||||||||||||||||||||
Time deposits under $100,000 | 207,222 | 0.38 | 582 | 230,354 | 0.37 | 637 | (23,132 | ) | 0.01 | (55 | ) | |||||||||||||||||||||
Time deposits $100,000 and over | 872,900 | 0.35 | 2,317 | 841,876 | 0.16 | 1,028 | 31,024 | 0.19 | 1,289 | |||||||||||||||||||||||
Total interest-bearing deposits | 3,331,283 | 0.16 | 4,045 | 3,135,068 | 0.11 | 2,641 | 196,215 | 0.05 | 1,404 | |||||||||||||||||||||||
Short-term borrowings | 106,144 | 0.49 | 387 | 95,759 | 0.27 | 195 | 10,385 | 0.22 | 192 | |||||||||||||||||||||||
Long-term debt | 92,785 | 3.18 | 2,206 | 92,785 | 2.81 | 1,949 | — | 0.37 | 257 | |||||||||||||||||||||||
Total interest-bearing liabilities | 3,530,212 | 0.25 | 6,638 | 3,323,612 | 0.19 | 4,785 | 206,600 | 0.06 | 1,853 | |||||||||||||||||||||||
Noninterest-bearing deposits | 1,139,823 | 1,053,398 | 86,425 | |||||||||||||||||||||||||||||
Other liabilities | 38,942 | 41,616 | (2,674 | ) | ||||||||||||||||||||||||||||
Total liabilities | 4,708,977 | 4,418,626 | 290,351 | |||||||||||||||||||||||||||||
Shareholders’ equity | 512,311 | 518,909 | (6,598 | ) | ||||||||||||||||||||||||||||
Non-controlling interest | 18 | — | 18 | |||||||||||||||||||||||||||||
Total equity | 512,329 | 518,909 | (6,580 | ) | ||||||||||||||||||||||||||||
Total liabilities and equity | $ | 5,221,306 | $ | 4,937,535 | $ | 283,771 | ||||||||||||||||||||||||||
Net interest income | $ | 119,853 | $ | 112,958 | $ | 6,895 | ||||||||||||||||||||||||||
Interest rate spread | 3.22 | % | 3.26 | % | (0.04 | )% | ||||||||||||||||||||||||||
Net interest margin | 3.29 | % | 3.31 | % | (0.02 | )% | ||||||||||||||||||||||||||
(1) At amortized cost. | ||||||||||||||||||||||||||||||||
(2) Includes nonaccrual loans. |
Three Months Ended | ||||||||||||||
(dollars in thousands) | September 30, 2016 | September 30, 2015 | $ Change | % Change | ||||||||||
Service charges on deposit accounts | $ | 1,954 | $ | 1,947 | $ | 7 | 0.4 | % | ||||||
Loan servicing fees | 1,357 | 1,407 | (50 | ) | -3.6 | % | ||||||||
Other service charges and fees | 2,821 | 2,803 | 18 | 0.6 | % | |||||||||
Income from fiduciary activities | 880 | 854 | 26 | 3.0 | % | |||||||||
Equity in earnings of unconsolidated subsidiaries | 182 | 165 | 17 | 10.3 | % | |||||||||
Fees on foreign exchange | 129 | 126 | 3 | 2.4 | % | |||||||||
Income from bank-owned life insurance | 555 | 434 | 121 | 27.9 | % | |||||||||
Loan placement fees | 140 | 202 | (62 | ) | -30.7 | % | ||||||||
Net gain on sales of residential mortgage loans | 2,212 | 1,551 | 661 | 42.6 | % | |||||||||
Net gain on sales of foreclosed assets | 57 | 252 | (195 | ) | -77.4 | % | ||||||||
Other: | ||||||||||||||
Income recovered on nonaccrual loans previously charged-off | 423 | 262 | 161 | 61.5 | % | |||||||||
Other recoveries | 24 | 244 | (220 | ) | -90.2 | % | ||||||||
Net unrealized gains (losses) on loans-held-for-sale and interest rate lock commitments | 13 | (646 | ) | 659 | -102.0 | % | ||||||||
Commissions on sale of checks | 84 | 86 | (2 | ) | -2.3 | % | ||||||||
Other | 144 | 142 | 2 | 1.4 | % | |||||||||
Total other operating income | $ | 10,975 | $ | 9,829 | $ | 1,146 | 11.7 | % |
Nine Months Ended | ||||||||||||||
(dollars in thousands) | September 30, 2016 | September 30, 2015 | $ Change | % Change | ||||||||||
Service charges on deposit accounts | $ | 5,826 | $ | 5,830 | $ | (4 | ) | -0.1 | % | |||||
Loan servicing fees | 4,081 | 4,257 | (176 | ) | -4.1 | % | ||||||||
Other service charges and fees | 8,616 | 8,689 | (73 | ) | -0.8 | % | ||||||||
Income from fiduciary activities | 2,577 | 2,518 | 59 | 2.3 | % | |||||||||
Equity in earnings of unconsolidated subsidiaries | 456 | 490 | (34 | ) | -6.9 | % | ||||||||
Fees on foreign exchange | 403 | 352 | 51 | 14.5 | % | |||||||||
Investment securities gains (losses) | — | (1,866 | ) | 1,866 | -100.0 | % | ||||||||
Income from bank-owned life insurance | 2,412 | 1,569 | 843 | 53.7 | % | |||||||||
Loan placement fees | 319 | 574 | (255 | ) | -44.4 | % | ||||||||
Net gain on sales of residential mortgage loans | 5,523 | 4,775 | 748 | 15.7 | % | |||||||||
Net gain on sales of foreclosed assets | 606 | 379 | 227 | 59.9 | % | |||||||||
Other: | ||||||||||||||
Income recovered on nonaccrual loans previously charged-off | 881 | 690 | 191 | 27.7 | % | |||||||||
Other recoveries | 294 | 533 | (239 | ) | -44.8 | % | ||||||||
Net unrealized gains (losses) on loans-held-for-sale and interest rate lock commitments | (95 | ) | (378 | ) | 283 | -74.9 | % | |||||||
Commissions on sale of checks | 256 | 246 | 10 | 4.1 | % | |||||||||
Other | 677 | 485 | 192 | 39.6 | % | |||||||||
Total other operating income | $ | 32,832 | $ | 29,143 | $ | 3,689 | 12.7 | % |
Three Months Ended | ||||||||||||||
(dollars in thousands) | September 30, 2016 | September 30, 2015 | $ Change | % Change | ||||||||||
Salaries and employee benefits | $ | 17,459 | $ | 17,193 | $ | 266 | 1.5 | % | ||||||
Net occupancy | 3,588 | 3,547 | 41 | 1.2 | % | |||||||||
Equipment | 852 | 775 | 77 | 9.9 | % | |||||||||
Amortization of other intangible assets | 1,690 | 1,683 | 7 | 0.4 | % | |||||||||
Communication expense | 948 | 895 | 53 | 5.9 | % | |||||||||
Legal and professional services | 1,699 | 1,808 | (109 | ) | -6.0 | % | ||||||||
Computer software expense | 2,217 | 2,286 | (69 | ) | -3.0 | % | ||||||||
Advertising expense | 772 | 502 | 270 | 53.8 | % | |||||||||
Foreclosed asset expense | 72 | 3 | 69 | 2,300.0 | % | |||||||||
Other: | ||||||||||||||
Charitable contributions | 156 | 179 | (23 | ) | -12.8 | % | ||||||||
FDIC insurance assessment | 430 | 685 | (255 | ) | -37.2 | % | ||||||||
Miscellaneous loan expenses | 358 | 314 | 44 | 14.0 | % | |||||||||
ATM and debit card expenses | 451 | 365 | 86 | 23.6 | % | |||||||||
Amortization of investments in low-income housing tax credit partnerships | 259 | 258 | 1 | 0.4 | % | |||||||||
Armored car expenses | 258 | 213 | 45 | 21.1 | % | |||||||||
Entertainment and promotions | 198 | 191 | 7 | 3.7 | % | |||||||||
Stationery and supplies | 242 | 381 | (139 | ) | -36.5 | % | ||||||||
Directors’ fees and expenses | 215 | 156 | 59 | 37.8 | % | |||||||||
Provision (credit) for residential mortgage loan repurchase losses | — | (883 | ) | 883 | -100.0 | % | ||||||||
Increase (decrease) to the reserve for unfunded commitments | 37 | 255 | (218 | ) | -85.5 | % | ||||||||
Other | 1,385 | 1,369 | 16 | 1.2 | % | |||||||||
Total other operating expense | $ | 33,286 | $ | 32,175 | $ | 1,111 | 3.5 | % |
Nine Months Ended | ||||||||||||||
(dollars in thousands) | September 30, 2016 | September 30, 2015 | $ Change | % Change | ||||||||||
Salaries and employee benefits | $ | 52,246 | $ | 49,534 | $ | 2,712 | 5.5 | % | ||||||
Net occupancy | 10,459 | 10,451 | 8 | 0.1 | % | |||||||||
Equipment | 2,432 | 2,617 | (185 | ) | -7.1 | % | ||||||||
Amortization of other intangible assets | 6,291 | 5,347 | 944 | 17.7 | % | |||||||||
Communication expense | 2,826 | 2,661 | 165 | 6.2 | % | |||||||||
Legal and professional services | 5,035 | 5,669 | (634 | ) | -11.2 | % | ||||||||
Computer software expense | 7,143 | 6,764 | 379 | 5.6 | % | |||||||||
Advertising expense | 1,839 | 1,586 | 253 | 16.0 | % | |||||||||
Foreclosed asset expense | 136 | 332 | (196 | ) | -59.0 | % | ||||||||
Other: | ||||||||||||||
Charitable contributions | 558 | 2,456 | (1,898 | ) | -77.3 | % | ||||||||
FDIC insurance assessment | 1,632 | 2,084 | (452 | ) | -21.7 | % | ||||||||
Miscellaneous loan expenses | 918 | 1,023 | (105 | ) | -10.3 | % | ||||||||
ATM and debit card expenses | 1,327 | 1,131 | 196 | 17.3 | % | |||||||||
Amortization of investments in low-income housing tax credit partnerships | 774 | 820 | (46 | ) | -5.6 | % | ||||||||
Armored car expenses | 660 | 642 | 18 | 2.8 | % | |||||||||
Entertainment and promotions | 652 | 654 | (2 | ) | -0.3 | % | ||||||||
Stationery and supplies | 681 | 796 | (115 | ) | -14.4 | % | ||||||||
Directors’ fees and expenses | 619 | 561 | 58 | 10.3 | % | |||||||||
Provision (credit) for residential mortgage loan repurchase losses | (387 | ) | (756 | ) | 369 | -48.8 | % | |||||||
Increase (decrease) to the reserve for unfunded commitments | 101 | (48 | ) | 149 | -310.4 | % | ||||||||
Other | 4,434 | 4,327 | 107 | 2.5 | % | |||||||||
Total other operating expense | $ | 100,376 | $ | 98,651 | $ | 1,725 | 1.7 | % |
(Dollars in thousands) | September 30, 2016 | December 31, 2015 | $ Change | % Change | |||||||||||
Hawaii: | |||||||||||||||
Commercial, financial and agricultural | $ | 367,527 | $ | 339,738 | $ | 27,789 | 8.2 | % | |||||||
Real estate: | |||||||||||||||
Construction | 105,234 | 81,655 | 23,579 | 28.9 | |||||||||||
Residential mortgage | 1,160,741 | 1,134,325 | 26,416 | 2.3 | |||||||||||
Home equity | 351,256 | 301,980 | 49,276 | 16.3 | |||||||||||
Commercial mortgage | 742,584 | 642,845 | 99,739 | 15.5 | |||||||||||
Consumer: | |||||||||||||||
Automobiles | 125,556 | 110,285 | 15,271 | 13.8 | |||||||||||
Other consumer | 163,703 | 162,963 | 740 | 0.5 | |||||||||||
Leases | 756 | 1,028 | (272 | ) | (26.5 | ) | |||||||||
Total loans and leases | 3,017,357 | 2,774,819 | 242,538 | 8.7 | |||||||||||
Allowance for loan and lease losses | (50,948 | ) | (54,141 | ) | 3,193 | (5.9 | ) | ||||||||
Net loans and leases | $ | 2,966,409 | $ | 2,720,678 | $ | 245,731 | 9.0 | ||||||||
U.S. Mainland: | |||||||||||||||
Commercial, financial and agricultural | $ | 140,457 | $ | 181,348 | $ | (40,891 | ) | (22.5 | ) | ||||||
Real estate: | |||||||||||||||
Construction | 2,994 | 3,230 | (236 | ) | (7.3 | ) | |||||||||
Residential mortgage | — | — | — | — | |||||||||||
Home equity | — | — | — | — | |||||||||||
Commercial mortgage | 120,133 | 117,904 | 2,229 | 1.9 | |||||||||||
Consumer: | |||||||||||||||
Automobiles | 91,970 | 79,917 | 12,053 | 15.1 | |||||||||||
Other consumer | 66,743 | 54,314 | 12,429 | 22.9 | |||||||||||
Leases | — | — | — | — | |||||||||||
Total loans and leases | 422,297 | 436,713 | (14,416 | ) | (3.3 | ) | |||||||||
Allowance for loan and lease losses | (8,436 | ) | (9,173 | ) | 737 | (8.0 | ) | ||||||||
Net loans and leases | $ | 413,861 | $ | 427,540 | $ | (13,679 | ) | (3.2 | ) | ||||||
Total: | |||||||||||||||
Commercial, financial and agricultural | $ | 507,984 | $ | 521,086 | $ | (13,102 | ) | (2.5 | ) | ||||||
Real estate: | |||||||||||||||
Construction | 108,228 | 84,885 | 23,343 | 27.5 | |||||||||||
Residential mortgage | 1,160,741 | 1,134,325 | 26,416 | 2.3 | |||||||||||
Home equity | 351,256 | 301,980 | 49,276 | 16.3 | |||||||||||
Commercial mortgage | 862,717 | 760,749 | 101,968 | 13.4 | |||||||||||
Consumer: | |||||||||||||||
Automobiles | 217,526 | 190,202 | 27,324 | 14.4 | |||||||||||
Other consumer | 230,446 | 217,277 | 13,169 | 6.1 | |||||||||||
Leases | 756 | 1,028 | (272 | ) | (26.5 | ) | |||||||||
Total loans and leases | 3,439,654 | 3,211,532 | 228,122 | 7.1 | |||||||||||
Allowance for loan and lease losses | (59,384 | ) | (63,314 | ) | 3,930 | (6.2 | ) | ||||||||
Net loans and leases | $ | 3,380,270 | $ | 3,148,218 | $ | 232,052 | 7.4 |
(dollars in thousands) | September 30, 2016 | December 31, 2015 | $ Change | % Change | ||||||||||
Nonperforming Assets | ||||||||||||||
Nonaccrual loans (including loans held for sale): | ||||||||||||||
Commercial, financial and agricultural | $ | 2,005 | $ | 1,044 | $ | 961 | 92.0 | % | ||||||
Real estate: | ||||||||||||||
Residential mortgage | 5,424 | 5,464 | (40 | ) | (0.7 | ) | ||||||||
Home equity | 479 | 666 | (187 | ) | (28.1 | ) | ||||||||
Commercial mortgage | 2,967 | 7,094 | (4,127 | ) | (58.2 | ) | ||||||||
Total nonaccrual loans | 10,875 | 14,268 | (3,393 | ) | (23.8 | ) | ||||||||
Other real estate owned ("OREO"): | ||||||||||||||
Real estate: | ||||||||||||||
Residential mortgage | 791 | 1,962 | (1,171 | ) | (59.7 | ) | ||||||||
Total OREO | 791 | 1,962 | (1,171 | ) | (59.7 | ) | ||||||||
Total nonperforming assets | 11,666 | 16,230 | (4,564 | ) | (28.1 | ) | ||||||||
Accruing Loans Delinquent for 90 Days or More | ||||||||||||||
Real estate: | ||||||||||||||
Residential mortgage | 200 | — | 200 | — | ||||||||||
Consumer: | ||||||||||||||
Automobiles | 131 | 151 | (20 | ) | (13.2 | ) | ||||||||
Other consumer | 106 | 122 | (16 | ) | (13.1 | ) | ||||||||
Total accruing loans delinquent for 90 days or more | 437 | 273 | 164 | 60.1 | ||||||||||
Restructured Loans Still Accruing Interest | ||||||||||||||
Real estate: | ||||||||||||||
Construction | 51 | 809 | (758 | ) | (93.7 | ) | ||||||||
Residential mortgage | 15,818 | 16,224 | (406 | ) | (2.5 | ) | ||||||||
Commercial mortgage | 1,979 | 3,224 | (1,245 | ) | (38.6 | ) | ||||||||
Total restructured loans still accruing interest | 17,848 | 20,257 | (2,409 | ) | (11.9 | ) | ||||||||
Total nonperforming assets, accruing loans delinquent for 90 days or more and restructured loans still accruing interest | $ | 29,951 | $ | 36,760 | $ | (6,809 | ) | (18.5 | ) | |||||
Ratio of nonaccrual loans to total loans and leases | 0.32 | % | 0.44 | % | (0.12 | )% | ||||||||
Ratio of nonperforming assets to total loans and leases and OREO | 0.34 | % | 0.51 | % | (0.17 | )% | ||||||||
Ratio of nonperforming assets and accruing loans delinquent for 90 days or more to total loans and leases and OREO | 0.35 | % | 0.51 | % | (0.16 | )% | ||||||||
Ratio of nonperforming assets, accruing loans delinquent for 90 days or more, and restructured loans still accruing interest to total loans and leases and OREO | 0.87 | % | 1.14 | % | (0.27 | )% |
Year-to-Date Changes in Nonperforming Assets: | |||
(dollars in thousands) | |||
Balance at December 31, 2015 | $ | 16,230 | |
Additions | 6,287 | ||
Reductions: | |||
Payments | (3,990 | ) | |
Return to accrual status | (4,428 | ) | |
Sales of nonperforming assets | (2,599 | ) | |
Charge-offs and/or valuation adjustments | 166 | ||
Total reductions | (10,851 | ) | |
Net increase (decrease) | (4,564 | ) | |
Balance at September 30, 2016 | $ | 11,666 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
(dollars in thousands) | 2016 | 2015 | 2016 | 2015 | |||||||||||
Allowance for Loan and Lease Losses: | |||||||||||||||
Balance at beginning of period | $ | 60,764 | $ | 66,924 | $ | 63,314 | $ | 74,040 | |||||||
Provision (credit) for loan and lease losses | (743 | ) | (3,647 | ) | (2,872 | ) | (13,713 | ) | |||||||
Charge-offs: | |||||||||||||||
Commercial, financial and agricultural | 465 | 170 | 1,089 | 5,104 | |||||||||||
Real estate: | |||||||||||||||
Home equity | — | 46 | — | 110 | |||||||||||
Consumer: | |||||||||||||||
Automobiles | 409 | 299 | 1,182 | 1,046 | |||||||||||
Other consumer | 940 | 575 | 2,414 | 2,883 | |||||||||||
Leases | — | — | — | — | |||||||||||
Total charge-offs | 1,814 | 1,090 | 4,685 | 9,143 | |||||||||||
Recoveries: | |||||||||||||||
Commercial, financial and agricultural | 555 | 504 | 1,624 | 4,377 | |||||||||||
Real estate: | |||||||||||||||
Construction | 91 | 283 | 109 | 870 | |||||||||||
Residential mortgage | 173 | 191 | 380 | 1,030 | |||||||||||
Home equity | 4 | 5 | 11 | 1,051 | |||||||||||
Commercial mortgage | 128 | 3,130 | 155 | 6,705 | |||||||||||
Consumer: | |||||||||||||||
Automobiles | 115 | 209 | 674 | 765 | |||||||||||
Other consumer | 111 | 108 | 674 | 635 | |||||||||||
Leases | — | 27 | — | 27 | |||||||||||
Total recoveries | 1,177 | 4,457 | 3,627 | 15,460 | |||||||||||
Net charge-offs (recoveries) | 637 | (3,367 | ) | 1,058 | (6,317 | ) | |||||||||
Balance at end of period | $ | 59,384 | $ | 66,644 | $ | 59,384 | $ | 66,644 | |||||||
Annualized ratio of net charge-offs (recoveries) to average loans and leases | 0.07 | % | (0.44 | )% | 0.04 | % | (0.28 | )% | |||||||
(dollars in thousands) | September 30, 2016 | December 31, 2015 | $ Change | % Change | ||||||||||
Noninterest-bearing demand deposits | $ | 1,194,557 | $ | 1,145,244 | $ | 49,313 | 4.3 | % | ||||||
Interest-bearing demand deposits | 849,128 | 824,895 | 24,233 | 2.9 | ||||||||||
Savings and money market deposits | 1,379,484 | 1,399,093 | (19,609 | ) | (1.4 | ) | ||||||||
Time deposits less than $100,000 | 198,055 | 212,946 | (14,891 | ) | (7.0 | ) | ||||||||
Core deposits | 3,621,224 | 3,582,178 | 39,046 | 1.1 | ||||||||||
Government time deposits | 708,034 | 664,756 | 43,278 | 6.5 | ||||||||||
Other time deposits $100,000 and greater | 189,320 | 186,505 | 2,815 | 1.5 | ||||||||||
Total time deposits $100,000 and greater | 897,354 | 851,261 | 46,093 | 5.4 | ||||||||||
Total deposits | $ | 4,518,578 | $ | 4,433,439 | $ | 85,139 | 1.9 |
Actual | Minimum Required for Capital Adequacy Purposes | Minimum Required to be Well Capitalized | |||||||||||||||||||
(dollars in thousands) | Amount | Ratio | Amount | Ratio | Amount | Ratio | |||||||||||||||
Company | |||||||||||||||||||||
At September 30, 2016: | |||||||||||||||||||||
Leverage capital | $ | 567,891 | 10.9 | % | $ | 208,324 | 4.0 | % | $ | 260,405 | 5.0 | % | |||||||||
Tier 1 risk-based capital | 567,891 | 14.6 | 233,445 | 6.0 | 311,260 | 8.0 | |||||||||||||||
Total risk-based capital | 616,858 | 15.9 | 311,260 | 8.0 | 389,075 | 10.0 | |||||||||||||||
CET1 risk-based capital | 487,097 | 12.5 | 175,084 | 4.5 | 252,899 | 6.5 | |||||||||||||||
At December 31, 2015: | |||||||||||||||||||||
Leverage capital | $ | 532,787 | 10.7 | % | $ | 199,350 | 4.0 | % | $ | 249,187 | 5.0 | % | |||||||||
Tier 1 risk-based capital | 532,787 | 14.4 | 221,808 | 6.0 | 295,745 | 8.0 | |||||||||||||||
Total risk-based capital | 579,651 | 15.7 | 295,745 | 8.0 | 369,681 | 10.0 | |||||||||||||||
CET1 risk-based capital | 472,698 | 12.8 | 166,356 | 4.5 | 240,292 | 6.5 | |||||||||||||||
Central Pacific Bank | |||||||||||||||||||||
At September 30, 2016: | |||||||||||||||||||||
Leverage capital | $ | 545,578 | 10.6 | % | $ | 206,280 | 4.0 | % | $ | 257,850 | 5.0 | % | |||||||||
Tier 1 risk-based capital | 545,578 | 14.1 | 233,068 | 6.0 | 310,757 | 8.0 | |||||||||||||||
Total risk-based capital | 594,407 | 15.3 | 310,757 | 8.0 | 388,446 | 10.0 | |||||||||||||||
CET1 risk-based capital | 545,578 | 14.1 | 174,801 | 4.5 | 252,490 | 6.5 | |||||||||||||||
At December 31, 2015: | |||||||||||||||||||||
Leverage capital | $ | 518,617 | 10.4 | % | $ | 199,098 | 4.0 | % | $ | 248,872 | 5.0 | % | |||||||||
Tier 1 risk-based capital | 518,617 | 14.1 | 221,435 | 6.0 | 295,247 | 8.0 | |||||||||||||||
Total risk-based capital | 565,231 | 15.3 | 295,247 | 8.0 | 369,058 | 10.0 | |||||||||||||||
CET1 risk-based capital | 518,617 | 14.1 | 166,076 | 4.5 | 239,888 | 6.5 |
Issuer Purchases of Equity Securities | ||||||||||||||
Period | Total Number of Shares Purchased | Average Price Paid per Share | Total Shares Purchased as Part of Publicly Announced Programs | Maximum Dollar Value of Shares That May Yet Be Purchased Under the Program(1) | ||||||||||
July 1-31, 2016 | 48,000 | $ | 23.13 | 48,000 | $ | 18,345,599 | ||||||||
August 1-31, 2016 | 12,000 | 25.13 | 12,000 | 18,044,058 | ||||||||||
September 1-30, 2016 | 84,000 | 25.37 | 84,000 | 15,912,819 | ||||||||||
Total | 144,000 | $ | 24.60 | 144,000 | $ | 15,912,819 |
(1) | On January 27, 2016, our Board of Directors (the “BOD”) approved the authorization to repurchase up to $30.0 million of the Company's common stock (the "2016 Repurchase Plan"), which supersedes in its entirety the repurchase plan that was previously approved by the BOD. As of September 30, 2016, $15.9 million remained of the total $30.0 million total repurchase amount authorized by the BOD under the 2016 Repurchase Plan. The plan has no set expiration or termination date. |
Exhibit No. | Document | |
31.1 | Rule 13a-14(a) Certification of Chief Executive Officer in accordance with Section 302 of the Sarbanes-Oxley Act of 2002 * | |
31.2 | Rule 13a-14(a) Certification of Chief Financial Officer in accordance with Section 302 of the Sarbanes-Oxley Act of 2002 * | |
32.1 | Section 1350 Certification of Chief Executive Officer in accordance with Section 906 of the Sarbanes-Oxley Act of 2002 ** | |
32.2 | Section 1350 Certification of Chief Financial Officer in accordance with Section 906 of the Sarbanes-Oxley Act of 2002 ** | |
101.INS | XBRL Instance Document* | |
101.SCH | XBRL Taxonomy Extension Schema Document* | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document* | |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document* | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document* | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document* |
CENTRAL PACIFIC FINANCIAL CORP. | |
(Registrant) | |
Date: November 8, 2016 | /s/ A. Catherine Ngo |
A. Catherine Ngo | |
President and Chief Executive Officer | |
Date: November 8, 2016 | /s/ David S. Morimoto |
David S. Morimoto | |
Executive Vice President and Chief Financial Officer |
Exhibit No. | Description | |
31.1 | Rule 13a-14(a) Certification of Chief Executive Officer in accordance with Section 302 of the Sarbanes-Oxley Act of 2002 | |
31.2 | Rule 13a-14(a) Certification of Chief Financial Officer in accordance with Section 302 of the Sarbanes-Oxley Act of 2002 | |
32.1 | Section 1350 Certification of Chief Executive Officer in accordance with Section 906 of the Sarbanes-Oxley Act of 2002 | |
32.2 | Section 1350 Certification of Chief Financial Officer in accordance with Section 906 of the Sarbanes-Oxley Act of 2002 | |
101.INS | XBRL Instance Document | |
101.SCH | XBRL Taxonomy Extension Schema Document | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document |
(1) | I have reviewed this quarterly report on Form 10-Q of the Company; |
(2) | Based on my knowledge, this quarterly 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 quarterly report; |
(3) | Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this quarterly report; |
(4) | The Company’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(e)) for the Company and we 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 Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly 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 Company’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 quarterly report based on such evaluation; and |
(d) | disclosed in this quarterly report any change in the Company’s internal control over financial reporting that occurred during the Company’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting; and |
(5) | The Company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company’s auditors and the audit committee of the Company’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 Company’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 Company’s internal control over financial reporting. |
Date: | November 8, 2016 | /s/ A. Catherine Ngo |
A. Catherine Ngo | ||
President and Chief Executive Officer |
(1) | I have reviewed this quarterly report on Form 10-Q of the Company; |
(2) | Based on my knowledge, this quarterly 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 quarterly report; |
(3) | Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this quarterly report; |
(4) | The Company’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(e)) for the Company and we 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 Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly 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 Company’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 quarterly report based on such evaluation; and |
(d) | disclosed in this quarterly report any change in the Company’s internal control over financial reporting that occurred during the Company’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting; and |
(5) | The Company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company’s auditors and the audit committee of the Company’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 Company’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 Company’s internal control over financial reporting. |
Date: | November 8, 2016 | /s/ David S. Morimoto |
David S. Morimoto | ||
Executive Vice President and Chief Financial Officer | ||
(Principal Financial and Accounting Officer) |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material aspects, the financial condition and results of operations of the Company. |
Date: | November 8, 2016 | /s/ A. Catherine Ngo |
A. Catherine Ngo | ||
President and Chief Executive Officer |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material aspects, the financial condition and results of operations of the Company. |
Date: | November 8, 2016 | /s/ David S. Morimoto |
David S. Morimoto | ||
Executive Vice President and Chief Financial Officer | ||
(Principal Financial and Accounting Officer) |
Document and Entity Information - shares |
9 Months Ended | |
---|---|---|
Sep. 30, 2016 |
Nov. 04, 2016 |
|
Document and Entity Information | ||
Entity Registrant Name | CENTRAL PACIFIC FINANCIAL CORP | |
Entity Central Index Key | 0000701347 | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2016 | |
Document Fiscal Year Focus | 2016 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 30,830,598 |
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands |
Sep. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Held to maturity, fair value (in dollars) | $ 230,529 | $ 244,136 |
Preferred stock, par value (in dollars per share) | $ 0 | $ 0 |
Preferred stock, authorized shares | 1,100,000 | 1,100,000 |
Preferred stock, issued shares | 0 | 0 |
Preferred stock, outstanding shares | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0 | $ 0 |
Common stock, authorized shares | 185,000,000 | 185,000,000 |
Common stock, issued shares | 31,036,895 | 31,361,452 |
Common stock, outstanding shares | 31,036,895 | 31,361,452 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
|
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 11,466 | $ 12,206 | $ 34,784 | $ 34,936 |
Other comprehensive income (loss), net of tax: | ||||
Net change in unrealized gain (loss) on investment securities | (2,042) | 7,563 | 15,677 | 3,102 |
Minimum pension liability adjustment | 249 | 259 | 748 | 775 |
Total other comprehensive income (loss), net of tax | (1,793) | 7,822 | 16,425 | 3,877 |
Comprehensive income | $ 9,673 | $ 20,028 | $ 51,209 | $ 38,813 |
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Parenthetical) - $ / shares |
9 Months Ended | |
---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
|
Statement of Stockholders' Equity [Abstract] | ||
Cash dividends (in dollars per share) | $ 0.44 | $ 0.36 |
Common stock (purchased) sold by directors' deferred compensation plan (in net shares) | 5,000 | 8,159 |
Shares of common stock repurchased | 636,922 | 4,122,881 |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
9 Months Ended |
---|---|
Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited consolidated financial statements of Central Pacific Financial Corp. and Subsidiaries (herein referred to as the “Company,” “we,” “us” or “our”) have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. These interim condensed consolidated financial statements and notes should be read in conjunction with the Company’s consolidated financial statements and notes thereto filed on Form 10-K for the fiscal year ended December 31, 2015. In the opinion of management, all adjustments necessary for a fair presentation have been made and include all normal recurring adjustments. Interim results of operations are not necessarily indicative of results to be expected for the year. Principles of Consolidation The consolidated financial statements include the accounts of the Company and its majority-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. In December 2015, we acquired a 50% ownership interest in a mortgage loan origination and brokerage company, One Hawaii HomeLoans, LLC. The bank concluded that the investment meets the consolidation requirements under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 810, "Consolidation." The bank concluded that the entity meets the definition of a variable interest entity and that we are the primary beneficiary of the variable interest entity. Accordingly, the investment has been consolidated into our financial statements as of September 30, 2016. We have 50% ownership interests in four other mortgage loan origination and brokerage companies which are accounted for using the equity method and are included in investment in unconsolidated subsidiaries: Pacific Access Mortgage, LLC, Gentry HomeLoans, LLC, Haseko HomeLoans, LLC and Island Pacific HomeLoans, LLC. |
RECENT ACCOUNTING PRONOUNCEMENTS |
9 Months Ended |
---|---|
Sep. 30, 2016 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
RECENT ACCOUNTING PRONOUNCEMENTS | RECENT ACCOUNTING PRONOUNCEMENTS In June 2014, the FASB issued ASU 2014-12, “Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period.” ASU 2014-12 requires that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. As of September 30, 2016, the Company did not have any share-based payment awards that included performance targets that could be achieved after the requisite service period. As such, the adoption of ASU 2014-12 on January 1, 2016 did not have a material impact on our consolidated financial statements. In February 2015, the FASB issued ASU 2015-02, “Amendments to the Consolidation Analysis.” ASU 2015-02 changes the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. Specifically, the amendments:1) modify the evaluation of whether limited partnerships and similar legal entities are variable interest entities (“VIEs”) or voting interest entities; 2) eliminate the presumption that a general partner should consolidate a limited partnership; 3) affect the consolidation analysis of reporting entities that are involved with VIEs, particularly those that have fee arrangements and related party relationships; 4) provide a scope exception from consolidation guidance for reporting entities with interests in legal entities that are required to comply with or operate in accordance with requirements that are similar to those in Rule 2a-7 of the Investment Company Act of 1940 for registered money market funds. All legal entities are subject to reevaluation under the revised consolidation model. The adoption of ASU 2015-02 on January 1, 2016 did not have a material impact on our consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, “Classification of Certain Cash Receipts and Cash Payments (Topic 230)." ASU 2016-15 provides guidance on eight statement of cash flow classification issues and is intended to reduce the current and future diversity in practice described in the amendments. Current GAAP is either unclear or does not include specific guidance on the eight statement of cash flow classification issues included in ASU 2016-15. ASU 2016-15 is effective for the Company's reporting period beginning January 1, 2018. Early adoption is permitted, provided that all of the amendments are adopted in the same period. The amendments in ASU 2016-15 should be applied using a retrospective transition method to each period presented. If it is impracticable to apply the amendments retrospectively for some of the issues, the amendments for those issues would be applied prospectively as of the earliest date practicable. As ASU 2016-15 only impacts classification within the statement of cash flows, we do not expect the adoption of this guidance to have a material impact on our consolidated financial statements. |
INVESTMENT SECURITIES |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVESTMENT SECURITIES | INVESTMENT SECURITIES A summary of held-to-maturity and available-for-sale investment securities are as follows:
The amortized cost and estimated fair value of investment securities at September 30, 2016 by contractual maturity are shown below. Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.
We did not sell any available-for-sale securities during the nine months ended September 30, 2016. During the second quarter of 2015, we sold certain available-for-sale investment securities for gross proceeds of $117.5 million. Gross realized losses on the sale of the available-for-sale investment securities were $1.9 million. The specific identification method was used as the basis for determining the cost of all securities sold. We did not sell any available-for-sale securities during the first and third quarters of 2015. Investment securities of $1.10 billion and $1.00 billion at September 30, 2016 and December 31, 2015, respectively, were pledged to secure public funds on deposit and other long-term debt and short-term borrowings. Provided below is a summary of the 21 and 155 investment securities which were in an unrealized loss position at September 30, 2016 and December 31, 2015, respectively, segregated by continuous length of impairment.
Other-Than-Temporary Impairment (“OTTI”) Unrealized losses for all investment securities are reviewed to determine whether the losses are deemed “other-than-temporary.” Investment securities are evaluated for OTTI on at least a quarterly basis and more frequently when economic or market conditions warrant such an evaluation to determine whether a decline in their value below amortized cost is other-than-temporary. In conducting this assessment, we evaluate a number of factors including, but not limited to:
The term “other-than-temporary” is not intended to indicate that the decline is permanent, but indicates that the prospects for a near-term recovery of value are not necessarily favorable, or that there is a general lack of evidence to support a realizable value equal to or greater than the carrying value of the investment. Once a decline in value is determined to be other-than-temporary, the value of the security is reduced and a corresponding charge to earnings is recognized for anticipated credit losses. Because we have no intent to sell securities in an unrealized loss position and it is not more likely than not that we will be required to sell such securities before recovery of its amortized cost basis, we do not consider our investments to be other-than-temporarily impaired. |
LOANS AND LEASES |
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LOANS AND LEASES | LOANS AND LEASES Loans and leases, excluding loans held for sale, consisted of the following:
During the nine months ended September 30, 2016, we transferred the collateral in two portfolio loans with a carrying value totaling $1.3 million to other real estate owned. We did not transfer any loans to the held-for-sale category during the nine months ended September 30, 2016. In addition, we did not sell any portfolio loans during the nine months ended September 30, 2016. In March 2016, we purchased a direct auto loan portfolio totaling $23.2 million which included a $0.3 million premium over the $22.9 million outstanding balance. At the time of purchase, the auto loans had a weighted average remaining term of 56 months and a weighted average yield of 3.38%. During the first quarter of 2016, we also purchased unsecured consumer loans totaling $29.2 million, which represented the outstanding balance at the time of purchases. At the time of purchases, the unsecured consumer loans had a weighted average remaining term of 38 months and a weighted average interest rate of 7.55%. In May 2016, we purchased a direct auto loan portfolio totaling $18.0 million which included a $0.5 million premium over the $17.5 million outstanding balance. At the time of purchase, the auto loans had a weighted average remaining term of 75 months and a weighted average yield of 3.75%. During the second quarter of 2016, we also purchased unsecured consumer loans totaling $7.3 million, which represented the outstanding balance at the time of purchases. At the time of purchases, the unsecured consumer loans had a weighted average remaining term of 37 months and a weighted average interest rate of 7.57%. During the nine months ended September 30, 2015, we transferred the collateral in seven portfolio loans with a carrying value of $2.1 million to other real estate owned. In the second quarter of 2015, we transferred two portfolio loans to a single borrower with a carrying value of $6.6 million to the held-for-sale category and subsequently sold the two loans in the second quarter of 2015 at its carrying value. In August 2015, we purchased a participation interest in auto loans totaling $24.7 million, which included a $0.8 million premium over the $23.9 million outstanding balance. At the time of purchase, the auto loans had a weighted average remaining term of 68 months and a weighted average yield of 4.28%. In June 2015, we purchased a participation interest in auto loans totaling $28.1 million, which included a $1.0 million premium over the $27.1 million outstanding balance. At the time of the purchase, the auto loans had a weighted average remaining term of 79 months and a weighted average interest rate of 4.56%. Impaired Loans The following tables present by class, the balance in the allowance for loan and lease losses (the "Allowance") and the recorded investment in loans and leases based on the Company’s impairment measurement method as of September 30, 2016 and December 31, 2015:
The following tables present by class, information related to impaired loans as of September 30, 2016 and December 31, 2015:
The following table presents by class, the average recorded investment and interest income recognized on impaired loans for the three and nine months ended September 30, 2016 and 2015:
Foreclosure Proceedings The Company had $0.3 million of residential mortgage loans collateralized by residential real estate property that were in the process of foreclosure at September 30, 2016. Aging Analysis of Accruing and Non-Accruing Loans and Leases For all loan types, the Company determines delinquency status by considering the number of days full payments required by the contractual terms of the loan are past due. The following tables present by class, the aging of the recorded investment in past due loans and leases as of September 30, 2016 and December 31, 2015:
Modifications Troubled debt restructurings (“TDRs”) included in nonperforming assets at September 30, 2016 totaled $3.8 million and consisted of 20 Hawaii residential mortgage loans with a combined principal balance of $3.0 million and three Hawaii commercial, financial and agricultural loans with a combined principal balance of $0.8 million. Concessions made to the original contractual terms of these loans consisted primarily of the deferral of interest and/or principal payments due to deterioration in the borrowers’ financial condition. The principal balances on these TDRs had matured and/or were in default at the time of restructure and we have no commitments to lend additional funds to any of these borrowers. There were $17.8 million of TDRs still accruing interest at September 30, 2016, none of which were more than 90 days delinquent. At December 31, 2015, there were $20.3 million of TDRs still accruing interest, none of which were more than 90 days delinquent. Some loans modified in a TDR may already be on nonaccrual status and partial charge-offs may have already been taken against the outstanding loan balance. Thus, these loans have already been identified as impaired and have already been evaluated under the Company’s allowance for loan and lease losses (the “Allowance”) methodology. Loans that were not on nonaccrual status when modified in a TDR may have the financial effect of increasing the specific allowance associated with the loan. The loans modified in a TDR did not have a material effect on our provision for loan and lease losses (the “Provision”) and the Allowance during the three and nine months ended September 30, 2016. The following table presents by class, information related to loans modified in a TDR during the periods presented. No loans were modified in a TDR during the three months ended September 30, 2015.
No loans were modified as a TDR within the previous twelve months that subsequently defaulted during the three and nine months ended September 30, 2016 and 2015. Credit Quality Indicators The Company categorizes loans and leases into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Company analyzes loans and leases individually by classifying the loans and leases as to credit risk. This analysis includes non-homogeneous loans and leases, such as commercial and commercial real estate loans. This analysis is performed on a quarterly basis. The Company uses the following definitions for risk ratings: Special Mention. Loans and leases classified as special mention, while still adequately protected by the borrower’s capital adequacy and payment capability, exhibit distinct weakening trends and/or elevated levels of exposure to external conditions. If left unchecked or uncorrected, these potential weaknesses may result in deteriorated prospects of repayment. These exposures require management’s close attention so as to avoid becoming undue or unwarranted credit exposures. Substandard. Loans and leases classified as substandard are inadequately protected by the borrower’s current financial condition and payment capability or of the collateral pledged, if any. Loans and leases so classified have a well-defined weakness or weaknesses that jeopardize the orderly repayment of debt. They are characterized by the distinct possibility that the bank will sustain some loss if the deficiencies are not corrected. Doubtful. Loans and leases classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or orderly repayment in full, on the basis of current existing facts, conditions and values, highly questionable and improbable. Possibility of loss is extremely high, but because of certain important and reasonably specific factors that may work to the advantage and strengthening of the exposure, its classification as an estimated loss is deferred until its more exact status may be determined. Loss. Loans and leases classified as loss are considered to be non-collectible and of such little value that their continuance as bankable assets is not warranted. This does not mean the loan has absolutely no recovery value, but rather it is neither practical nor desirable to defer writing off the loan, even though partial recovery may be obtained in the future. Losses are taken in the period in which they surface as uncollectible. Loans and leases not meeting the criteria above are considered to be pass-rated. The following table presents by class and credit indicator, the recorded investment in the Company’s loans and leases as of September 30, 2016 and December 31, 2015:
In accordance with applicable Interagency Guidance issued by our primary bank regulators, we define subprime borrowers as typically having weakened credit histories that include payment delinquencies and possibly more severe problems such as charge-offs, judgments, and bankruptcies. They may also display reduced repayment capacity as measured by credit scores, debt-to-income ratios, or other criteria that may encompass borrowers with incomplete credit histories. Subprime loans are loans to borrowers displaying one or more of these characteristics at the time of origination or purchase. Such loans have a higher risk of default than loans to prime borrowers. At September 30, 2016 and December 31, 2015, we did not have any loans that we considered to be subprime. |
ALLOWANCE FOR LOAN AND LEASE LOSSES |
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ALLOWANCE FOR LOAN AND LEASE LOSSES | ALLOWANCE FOR LOAN AND LEASE LOSSES The following table presents by class, the activity in the Allowance for the periods indicated:
Loans held for sale and other real estate assets are not included in our assessment of the Allowance. Our Provision was a credit of $0.7 million and a credit of $2.9 million in the three and nine months ended September 30, 2016, respectively, compared to a credit of $3.6 million and a credit of $13.7 million in the three and nine months ended September 30, 2015, respectively. In determining the amount of our Allowance, we rely on an analysis of our loan portfolio, our experience and our evaluation of general economic conditions, as well as regulatory requirements and input. If our assumptions prove to be incorrect, our current Allowance may not be sufficient to cover future loan losses and we may experience significant increases to our Provision. |
SECURITIZATIONS |
9 Months Ended |
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Sep. 30, 2016 | |
Transfers and Servicing [Abstract] | |
SECURITIZATIONS | SECURITIZATIONS In prior years, we securitized certain residential mortgage loans with a U.S. Government sponsored entity and continue to service the residential mortgage loans. The servicing assets were recorded at their respective fair values at the time of securitization. All unsold mortgage-backed securities from prior securitizations were categorized as available for sale securities and were therefore recorded at their fair values of $2.1 million and $2.7 million at September 30, 2016 and December 31, 2015, respectively. The fair values of these mortgage-backed securities were based on quoted prices of similar instruments in active markets. Unrealized gains of $0.2 million and $0.2 million on unsold mortgage-backed securities were recorded in accumulated other comprehensive income (“AOCI”) at September 30, 2016 and December 31, 2015, respectively. |
INVESTMENTS IN UNCONSOLIDATED SUBSIDIARIES |
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Investments in and Advance to Affiliates, Subsidiaries, Associates, and Joint Ventures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVESTMENTS IN UNCONSOLIDATED SUBSIDIARIES | INVESTMENTS IN UNCONSOLIDATED SUBSIDIARIES The components of the Company’s investments in unconsolidated subsidiaries were as follows:
The Company had $1.7 million in unfunded low income housing commitments as of September 30, 2016. The entire amount is expected to be paid in 2018. The Company did not have any unfunded low income housing commitments as of December 31, 2015. Investments in low income housing tax credit (“LIHTC”) partnerships are accounted for using the cost method. The following table presents amortization and tax credits recognized associated with our investments in LIHTC partnerships for the three and nine months ended September 30, 2016 and September 30, 2015:
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OTHER INTANGIBLE ASSETS |
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OTHER INTANGIBLE ASSETS | OTHER INTANGIBLE ASSETS Other intangible assets include a core deposit premium and mortgage servicing rights. The following table presents changes in other intangible assets for the nine months ended September 30, 2016:
Income generated as the result of new mortgage servicing rights is reported as gains on sales of loans and totaled $0.9 million and $2.1 million for the three and nine months ended September 30, 2016, respectively, compared to $0.6 million and $1.8 million for the three and nine months ended September 30, 2015. Amortization of mortgage servicing rights was $1.0 million and $4.3 million for the three and nine months ended September 30, 2016, compared to $1.0 million and $3.3 million for the three and nine months ended September 30, 2015. The following table presents the fair market value and key assumptions used in determining the fair market value of our mortgage servicing rights:
The gross carrying value and accumulated amortization related to our intangible assets are presented below:
Based on the core deposit premium and mortgage servicing rights held as of September 30, 2016, estimated amortization expense for the remainder of fiscal year 2016, the next five succeeding fiscal years and all years thereafter are as follows:
We perform an impairment assessment of our other intangible assets whenever events or changes in circumstance indicate that the carrying value of those assets may not be recoverable. Our impairment assessments involve, among other valuation methods, the estimation of future cash flows and other methods of determining fair value. Estimating future cash flows and determining fair values is subject to judgment and often involves the use of significant estimates and assumptions. The variability of the factors we use to perform our impairment tests depend on a number of conditions, including the uncertainty about future events and cash flows. All such factors are interdependent and, therefore, do not change in isolation. Accordingly, our accounting estimates may materially change from period to period due to changing market factors. |
DERIVATIVES |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DERIVATIVES | DERIVATIVES We utilize various designated and undesignated derivative financial instruments to reduce our exposure to movements in interest rates including interest rate swaps, interest rate lock commitments and forward sale commitments. We measure all derivatives at fair value on our consolidated balance sheet. In each reporting period, we record the derivative instruments in other assets or other liabilities depending on whether the derivatives are in an asset or liability position. For derivative instruments that are designated as cash flow hedging instruments, we record the effective portion of the changes in the fair value of the derivative in AOCI, net of tax, until earnings are affected by the variability of cash flows of the hedged transaction. We immediately recognize the portion of the gain or loss in the fair value of the derivative that represents hedge ineffectiveness in current period earnings. For derivative instruments that are not designated as hedging instruments, changes in the fair value of the derivative are included in current period earnings. At September 30, 2016, we were not party to any cash flow hedging instruments. Interest Rate Lock and Forward Sale Commitments We enter into interest rate lock commitments on certain mortgage loans that are intended to be sold. To manage interest rate risk on interest rate lock commitments, we also enter into forward loan sale commitments. The interest rate locks and forward loan sale commitments are accounted for as undesignated derivatives and are recorded at their respective fair values in other assets or other liabilities, with changes in fair value recorded in current period earnings. These instruments serve to reduce our exposure to movements in interest rates. At September 30, 2016, we were a party to interest rate lock and forward sale commitments on $20.4 million and $32.4 million of mortgage loans, respectively. The following table presents the location of all assets and liabilities associated with our derivative instruments within the consolidated balance sheets:
The following table presents the impact of derivative instruments and their location within the consolidated statements of income:
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SHORT-TERM BORROWINGS AND LONG-TERM DEBT |
9 Months Ended |
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Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
SHORT-TERM BORROWINGS AND LONG-TERM DEBT | SHORT-TERM BORROWINGS AND LONG-TERM DEBT The bank is a member of the Federal Home Loan Bank of Des Moines (the “FHLB”) and maintained a $1.39 billion line of credit as of September 30, 2016, of which $1.24 billion was undrawn under this arrangement at September 30, 2016. Short-term borrowings under this arrangement totaled $150.0 million at September 30, 2016, compared to $69.0 million at December 31, 2015. There were no long-term borrowings under this arrangement at September 30, 2016 and December 31, 2015. FHLB advances outstanding at September 30, 2016 were secured by unencumbered investment securities with a fair value of $0.3 million and certain real estate loans with a carrying value of $1.81 billion in accordance with the collateral provisions of the Advances, Security and Deposit Agreement with the FHLB. At September 30, 2016 and December 31, 2015, our bank had additional unused borrowings available at the Federal Reserve discount window of $68.4 million and $40.8 million, respectively. As of September 30, 2016 and December 31, 2015, certain commercial and commercial real estate loans with a carrying value totaling $129.5 million and $87.3 million, respectively, were pledged as collateral on our line of credit with the Federal Reserve discount window. The Federal Reserve does not have the right to sell or repledge these loans. |
EQUITY |
9 Months Ended |
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Sep. 30, 2016 | |
Equity [Abstract] | |
EQUITY | EQUITY We have generated considerable tax benefits, including net operating loss carry-forwards and federal and state tax credits. Our use of the tax benefits in the future would be limited if we experience an “ownership change” for U.S. federal income tax purposes. In general, an “ownership change” will occur if there is a cumulative increase in the Company’s ownership by “5-percent shareholders” (as defined under U.S. income tax laws) that exceeds 50 percentage points over a rolling three-year period. On November 23, 2010, our Board of Directors declared a dividend of preferred share purchase rights (“Rights”) in respect to our common stock which were issued pursuant to a Tax Benefits Preservation Plan, dated as of November 23, 2010 (the “Tax Benefits Preservation Plan”), between the Company and Wells Fargo Bank, National Association, as rights agent. Each Right represents the right to purchase, upon the terms and subject to the conditions in the Plan, 1/10,000th of a share of our Junior Participating Preferred Stock, Series C, no par value, for $6.00, subject to adjustment. The Tax Benefits Preservation Plan is designed to reduce the likelihood that the Company will experience an ownership change by discouraging any person from becoming a beneficial owner of 4.99% or more of our common stock (a “Threshold Holder”). On January 29, 2014, our Board of Directors approved an amendment to the Tax Benefits Preservation Plan to extend it for up to an additional two years (until February 18, 2016). Subsequently, our Board of Directors determined in January 2016 that it was no longer necessary to continue the Tax Benefits Preservation Plan because we have utilized a significant portion of our tax benefits and we expect to be able to utilize the remaining benefits even if an ownership change occurs. As a result, our Tax Benefits Preservation Plan expired in accordance with its terms on February 18, 2016. To further protect our tax benefits, on January 26, 2011, our Board of Directors approved an amendment to our restated articles of incorporation to restrict transfers of our stock if the effect of an attempted transfer would cause the transferee to become a Threshold Holder or to cause the beneficial ownership of a Threshold Holder to increase (the “Protective Charter Amendment”). At our annual meeting of shareholders on April 27, 2011, we proposed the amendment which shareholders approved. On January 29, 2014, our Board of Directors approved an amendment to the Protective Charter Amendment to extend it for up to an additional two years (until May 2, 2016). Our shareholders approved the Protective Charter Amendment on April 25, 2014. Subsequently, our Board of Directors determined in January 2016 that it was no longer necessary to continue the Protective Charter Amendment because we had utilized a significant portion of our tax benefits and we expect to be able to utilize the remaining benefits even if an ownership change occurs. As a result, our Protective Charter Amendment expired in accordance with its terms on May 2, 2016. As a Hawaii state-chartered bank, Central Pacific Bank may only pay dividends to the extent it has retained earnings as defined under Hawaii banking law (“Statutory Retained Earnings”), which differs from GAAP retained earnings. As of September 30, 2016, the bank had Statutory Retained Earnings of $78.8 million. Dividends are payable at the discretion of the Board of Directors and there can be no assurance that the Board of Directors will continue to pay dividends at the same rate, or at all, in the future. Our ability to pay cash dividends to our shareholders is subject to restrictions under federal and Hawaii law, including restrictions imposed by the FRB and covenants set forth in various agreements we are a party to, including covenants set forth in our subordinated debentures. In January 2016, the Board of Directors authorized the repurchase of up to $30.0 million of the Company's common stock from time to time in the open market or in privately negotiated transactions, pursuant to a newly authorized share repurchase program (the "2016 Repurchase Plan"). The 2016 Repurchase Plan replaces and supersedes in its entirety the CPF Repurchase Plan previously approved by the Company's Board of Directors. In the nine months ended September 30, 2016, 636,922 shares of common stock, at a cost of $14.1 million, were repurchased under the 2016 Repurchase Plan. |
SHARE-BASED COMPENSATION |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | SHARE-BASED COMPENSATION Restricted Stock Awards and Units The table below presents the activity of restricted stock awards and units for the nine months ended September 30, 2016:
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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The following tables present the components of other comprehensive income for the three and nine months ended September 30, 2016 and 2015, by component:
The following tables present the changes in each component of AOCI, net of tax, for the three and nine months ended September 30, 2016 and 2015:
The following table presents the amounts reclassified out of each component of AOCI for the three and nine months ended September 30, 2016 and 2015:
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PENSION AND SUPPLEMENTAL EXECUTIVE RETIREMENT PLANS |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Compensation and Retirement Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PENSION AND SUPPLEMENTAL EXECUTIVE RETIREMENT PLANS | PENSION AND SUPPLEMENTAL EXECUTIVE RETIREMENT PLANS Central Pacific Bank has a defined benefit retirement plan (the “Pension Plan”) which covers certain eligible employees. The plan was curtailed effective December 31, 2002, and accordingly, plan benefits were fixed as of that date. The following table sets forth the components of net periodic benefit cost for the Pension Plan:
Our bank also established Supplemental Executive Retirement Plans (“SERPs”), which provide certain (current and former) officers of our bank with supplemental retirement benefits. We have not entered into a SERP since December 31, 2008. The following table sets forth the components of net periodic benefit cost for the SERPs:
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EARNINGS PER SHARE |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
EARNINGS PER SHARE | EARNINGS PER SHARE The following table presents the information used to compute basic and diluted earnings per common share for the periods indicated:
A total of 8,902 and 9,381 potentially dilutive securities have been excluded from the dilutive share calculation for the three and nine months ended September 30, 2016, respectively, as their effect was anti-dilutive, compared to 12,532 for the three and nine months ended September 30, 2015. |
FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES | FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES Disclosures about Fair Value of Financial Instruments Fair value estimates, methods and assumptions are set forth below for our financial instruments. Short-Term Financial Instruments The carrying values of short-term financial instruments are deemed to approximate fair values. Such instruments are considered readily convertible to cash and include cash and due from banks, interest-bearing deposits in other banks, accrued interest receivable, short-term borrowings, and accrued interest payable. Investment Securities The fair value of investment securities is based on market price quotations received from third-party pricing services. The third-party pricing services utilize pricing models supported with timely market data information. Where quoted market prices are not available, fair values are based on quoted market prices of comparable securities. Loans Fair values of loans are estimated based on discounted cash flows of portfolios of loans with similar financial characteristics including the type of loan, interest terms and repayment history. Fair values are calculated by discounting scheduled cash flows through estimated maturities using estimated market discount rates. Estimated market discount rates are reflective of credit and interest rate risks inherent in the Company’s various loan types and are derived from available market information, as well as specific borrower information. The fair value of loans are not based on the notion of exit price. Loans Held for Sale The fair value of loans classified as held for sale are generally based upon quoted prices for similar assets in active markets, acceptance of firm offer letters with agreed upon purchase prices, discounted cash flow models that take into account market observable assumptions, or independent appraisals of the underlying collateral securing the loans. We report the fair values of Hawaii and U.S. Mainland construction and commercial real estate loans net of applicable selling costs on our consolidated balance sheets. Other Interest Earning Assets The equity investment in common stock of the FHLB, which is redeemable for cash at par value, is reported at its par value. Deposit Liabilities The fair values of deposits with no stated maturity, such as noninterest-bearing demand deposits and interest-bearing demand and savings accounts, are equal to the amount payable on demand. The fair value of time deposits is estimated using discounted cash flow analyses. The discount rate is estimated using the rates currently offered for deposits of similar remaining maturities. Long-Term Debt The fair value of our long-term debt is estimated by discounting scheduled cash flows over the contractual borrowing period at the estimated market rate for similar borrowing arrangements. Off-Balance Sheet Financial Instruments The fair values of off-balance sheet financial instruments are estimated based on the fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the present creditworthiness of the counterparties, current settlement values or quoted market prices of comparable instruments. For derivative financial instruments, the fair values are based upon current market values, if available. If there are no relevant comparables, fair values are based on pricing models using current assumptions for interest rate swaps and options. Limitations Fair value estimates are made at a specific point in time based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time our entire holdings of a particular financial instrument. Because no market exists for a significant portion of our financial instruments, fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments and other factors. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates. Fair value estimates are based on existing on- and off-balance sheet financial instruments without attempting to estimate the value of future business and the value of assets and liabilities that are not considered financial instruments. For example, significant assets and liabilities that are not considered financial assets or liabilities include deferred tax assets, premises and equipment and intangible assets. In addition, the tax ramifications related to the realization of the unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in many of the estimates.
Fair Value Measurements We group our financial assets and liabilities at fair value into three levels based on the markets in which the financial assets and liabilities are traded and the reliability of the assumptions used to determine fair value as follows:
We base our fair values on the price that we would expect to receive if an asset were sold or pay to transfer a liability in an orderly transaction between market participants at the measurement date. We also maximize the use of observable inputs and minimize the use of unobservable inputs when developing fair value measurements. We use fair value measurements to record adjustments to certain financial assets and liabilities and to determine fair value disclosures. Available for sale securities and derivatives are recorded at fair value on a recurring basis. From time to time, we may be required to record other financial assets at fair value on a nonrecurring basis such as loans held for sale, impaired loans and mortgage servicing rights. These nonrecurring fair value adjustments typically involve application of the lower of cost or fair value accounting or write-downs of individual assets. There were no transfers of financial assets and liabilities between Level 1 and Level 2 of the fair value hierarchy during the three and nine months ended September 30, 2016. The following tables present the balances of assets and liabilities measured at fair value on a recurring basis as of September 30, 2016 and December 31, 2015:
For the nine months ended September 30, 2016 and 2015, the changes in Level 3 assets and liabilities measured at fair value on a recurring basis are summarized as follows:
Within the state and political subdivisions debt securities category, the Company holds four mortgage revenue bonds issued by the City & County of Honolulu with an aggregate fair value of $13.0 million and $12.8 million at September 30, 2016 and September 30, 2015, respectively. The Company estimates the fair value of its mortgage revenue bonds by using a discounted cash flow model to calculate the present value of estimated future principal and interest payments. The significant unobservable input used in the fair value measurement of the Company’s mortgage revenue bonds is the weighted average discount rate. As of September 30, 2016, the weighted average discount rate utilized was 3.89%, which was derived by incorporating a credit spread over the FHLB Fixed-Rate Advance curve. Significant increases (decreases) in the weighted average discount rate could result in a significantly lower (higher) fair value measurement. For assets measured at fair value on a nonrecurring basis that were recorded at fair value on our balance sheet at September 30, 2016 and December 31, 2015, the following table provides the level of valuation assumptions used to determine the respective fair values:
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SEGMENT INFORMATION |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEGMENT INFORMATION | SEGMENT INFORMATION We have the following three reportable segments: Banking Operations, Treasury and All Others. These segments are consistent with our internal functional reporting lines and are managed separately because each unit has different target markets, technological requirements, marketing strategies and specialized skills. The Banking Operations segment includes construction and real estate development lending, commercial lending, residential mortgage lending, indirect auto lending, trust services, retail brokerage services and our retail branch offices, which provide a full range of deposit and loan products, as well as various other banking services. The Treasury segment is responsible for managing the Company’s investment securities portfolio and wholesale funding activities. The All Others segment consists of all activities not captured by the Banking Operations or Treasury segments described above and includes activities such as electronic banking, data processing and management of bank owned properties. The accounting policies of the segments are consistent with the Company’s accounting policies that are described in Note 1 to the consolidated financial statements in the Annual Report on Form 10-K for the year ended December 31, 2015 filed with the SEC. The majority of the Company’s net income is derived from net interest income. Accordingly, management focuses primarily on net interest income, rather than gross interest income and expense amounts, in evaluating segment profitability. Intersegment net interest income (expense) was allocated to each segment based upon a funds transfer pricing process that assigns costs of funds to assets and earnings credits to liabilities based on market interest rates that reflect interest rate sensitivity and maturity characteristics. All administrative and overhead expenses are allocated to the segments at cost. Cash, investment securities, loans and leases and their related balances are allocated to the segment responsible for acquisition and maintenance of those assets. Segment assets also include all premises and equipment used directly in segment operations. Segment profits and assets are provided in the following table for the periods indicated.
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LEGAL PROCEEDINGS |
9 Months Ended |
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Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
LEGAL PROCEEDINGS | LEGAL PROCEEDINGS We are involved in legal actions arising in the ordinary course of business. Management, after consultation with our legal counsel, believes the ultimate disposition of those matters will not have a material adverse effect on our consolidated financial statements. |
RECENT ACCOUNTING PRONOUNCEMENTS (Policies) |
9 Months Ended |
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Sep. 30, 2016 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Recent Accounting Pronouncements | In June 2014, the FASB issued ASU 2014-12, “Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period.” ASU 2014-12 requires that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. As of September 30, 2016, the Company did not have any share-based payment awards that included performance targets that could be achieved after the requisite service period. As such, the adoption of ASU 2014-12 on January 1, 2016 did not have a material impact on our consolidated financial statements. In February 2015, the FASB issued ASU 2015-02, “Amendments to the Consolidation Analysis.” ASU 2015-02 changes the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. Specifically, the amendments:1) modify the evaluation of whether limited partnerships and similar legal entities are variable interest entities (“VIEs”) or voting interest entities; 2) eliminate the presumption that a general partner should consolidate a limited partnership; 3) affect the consolidation analysis of reporting entities that are involved with VIEs, particularly those that have fee arrangements and related party relationships; 4) provide a scope exception from consolidation guidance for reporting entities with interests in legal entities that are required to comply with or operate in accordance with requirements that are similar to those in Rule 2a-7 of the Investment Company Act of 1940 for registered money market funds. All legal entities are subject to reevaluation under the revised consolidation model. The adoption of ASU 2015-02 on January 1, 2016 did not have a material impact on our consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, “Classification of Certain Cash Receipts and Cash Payments (Topic 230)." ASU 2016-15 provides guidance on eight statement of cash flow classification issues and is intended to reduce the current and future diversity in practice described in the amendments. Current GAAP is either unclear or does not include specific guidance on the eight statement of cash flow classification issues included in ASU 2016-15. ASU 2016-15 is effective for the Company's reporting period beginning January 1, 2018. Early adoption is permitted, provided that all of the amendments are adopted in the same period. The amendments in ASU 2016-15 should be applied using a retrospective transition method to each period presented. If it is impracticable to apply the amendments retrospectively for some of the issues, the amendments for those issues would be applied prospectively as of the earliest date practicable. As ASU 2016-15 only impacts classification within the statement of cash flows, we do not expect the adoption of this guidance to have a material impact on our consolidated financial statements. |
INVESTMENT SECURITIES (Tables) |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of available for sale and held to maturity investment securities | A summary of held-to-maturity and available-for-sale investment securities are as follows:
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Schedule of amortized cost and estimated fair value of investment securities by contractual maturity | The amortized cost and estimated fair value of investment securities at September 30, 2016 by contractual maturity are shown below. Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.
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Schedule of investment securities in an unrealized loss position | Provided below is a summary of the 21 and 155 investment securities which were in an unrealized loss position at September 30, 2016 and December 31, 2015, respectively, segregated by continuous length of impairment.
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LOANS AND LEASES (Tables) |
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of loans and leases, excluding loans held for sale | Loans and leases, excluding loans held for sale, consisted of the following:
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Schedule of balance in the allowance for loan and lease losses and the recorded investment in loans and leases based on the impairment measurement methods, by class | The following tables present by class, the balance in the allowance for loan and lease losses (the "Allowance") and the recorded investment in loans and leases based on the Company’s impairment measurement method as of September 30, 2016 and December 31, 2015:
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Schedule of impaired loans, by class | The following tables present by class, information related to impaired loans as of September 30, 2016 and December 31, 2015:
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Schedule of average recorded investment and interest income recognized on impaired loans, by class | The following table presents by class, the average recorded investment and interest income recognized on impaired loans for the three and nine months ended September 30, 2016 and 2015:
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Schedule of aging of the recorded investment in past due loans and leases, by class | The following tables present by class, the aging of the recorded investment in past due loans and leases as of September 30, 2016 and December 31, 2015:
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Schedule of information related to loans modified in a TDR, by class | The following table presents by class, information related to loans modified in a TDR during the periods presented. No loans were modified in a TDR during the three months ended September 30, 2015.
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Schedule of recorded investment in loans and leases, by class and credit indicator | The following table presents by class and credit indicator, the recorded investment in the Company’s loans and leases as of September 30, 2016 and December 31, 2015:
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ALLOWANCE FOR LOAN AND LEASE LOSSES (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ALLOWANCE FOR LOAN AND LEASE LOSSES | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of activity in the allowance, by class | The following table presents by class, the activity in the Allowance for the periods indicated:
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INVESTMENTS IN UNCONSOLIDATED SUBSIDIARIES (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments in and Advance to Affiliates, Subsidiaries, Associates, and Joint Ventures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of investment in unconsolidated subsidiaries | The components of the Company’s investments in unconsolidated subsidiaries were as follows:
The following table presents amortization and tax credits recognized associated with our investments in LIHTC partnerships for the three and nine months ended September 30, 2016 and September 30, 2015:
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OTHER INTANGIBLE ASSETS (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
OTHER INTANGIBLE ASSETS | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of gross carrying value and accumulated amortization related to intangible assets | The gross carrying value and accumulated amortization related to our intangible assets are presented below:
The following table presents changes in other intangible assets for the nine months ended September 30, 2016:
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Schedule of fair market value and key assumptions used in determining the fair market value of our mortgage servicing rights | The following table presents the fair market value and key assumptions used in determining the fair market value of our mortgage servicing rights:
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Schedule of estimated amortization expense | Based on the core deposit premium and mortgage servicing rights held as of September 30, 2016, estimated amortization expense for the remainder of fiscal year 2016, the next five succeeding fiscal years and all years thereafter are as follows:
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DERIVATIVES (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of the location of all assets and liabilities associated with derivative instruments within the consolidated balance sheets | The following table presents the location of all assets and liabilities associated with our derivative instruments within the consolidated balance sheets:
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Schedule of the impact of derivative instruments and their location within the consolidated statements of income | The following table presents the impact of derivative instruments and their location within the consolidated statements of income:
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SHARE-BASED COMPENSATION (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of activity of restricted stock awards and units | The table below presents the activity of restricted stock awards and units for the nine months ended September 30, 2016:
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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of components of other comprehensive income (loss) | The following tables present the components of other comprehensive income for the three and nine months ended September 30, 2016 and 2015, by component:
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Schedule of changes in each component of AOCI, net of tax | The following tables present the changes in each component of AOCI, net of tax, for the three and nine months ended September 30, 2016 and 2015:
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Schedule of amounts reclassified out of each component of AOCI | The following table presents the amounts reclassified out of each component of AOCI for the three and nine months ended September 30, 2016 and 2015:
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PENSION AND SUPPLEMENTAL EXECUTIVE RETIREMENT PLANS (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pension Plan | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PENSION PLANS | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of components of net periodic benefit cost | The following table sets forth the components of net periodic benefit cost for the Pension Plan:
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SERPs | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PENSION PLANS | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of components of net periodic benefit cost | The following table sets forth the components of net periodic benefit cost for the SERPs:
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EARNINGS PER SHARE (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of information used to compute basic and diluted earnings per share | The following table presents the information used to compute basic and diluted earnings per common share for the periods indicated:
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FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of carrying amount and estimated fair value of financial instruments |
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Schedule of balances of assets and liabilities measured at fair value on a recurring basis | The following tables present the balances of assets and liabilities measured at fair value on a recurring basis as of September 30, 2016 and December 31, 2015:
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Schedule of changes in Level 3 assets and liabilities measured at fair value on a recurring basis | For the nine months ended September 30, 2016 and 2015, the changes in Level 3 assets and liabilities measured at fair value on a recurring basis are summarized as follows:
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Schedule of level of valuation assumptions used to determine the fair value of assets measured on a nonrecurring basis | For assets measured at fair value on a nonrecurring basis that were recorded at fair value on our balance sheet at September 30, 2016 and December 31, 2015, the following table provides the level of valuation assumptions used to determine the respective fair values:
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SEGMENT INFORMATION (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of segment profits (losses) and assets | Segment profits and assets are provided in the following table for the periods indicated.
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INVESTMENT SECURITIES (Narrative) (Details) - USD ($) $ in Millions |
3 Months Ended | ||
---|---|---|---|
Sep. 30, 2015 |
Sep. 30, 2016 |
Dec. 31, 2015 |
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Investments, Debt and Equity Securities [Abstract] | |||
Gross proceeds from available-for-sale investment securities | $ 117.5 | ||
Gross realized losses on sale of available-for-sale investment securities | $ 1.9 | ||
Investment securities pledged as collateral | $ 1,100.0 | $ 1,000.0 |
SECURITIZATIONS (Details) - USD ($) $ in Thousands |
Sep. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
SECURITIZATIONS | ||
Mortgage servicing rights | $ 15,638 | $ 17,797 |
Real estate, Mortgage - residential | Significant Other Observable Inputs (Level 2) | ||
SECURITIZATIONS | ||
Mortgage servicing rights | 2,100 | 2,700 |
Unrealized gains recorded in AOCI | $ 200 | $ 200 |
INVESTMENTS IN UNCONSOLIDATED SUBSIDIARIES (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
Dec. 31, 2015 |
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Investments in and Advance to Affiliates, Subsidiaries, Associates, and Joint Ventures [Abstract] | |||||
Investments in low income housing tax credit partnerships | $ 3,625 | $ 3,625 | $ 2,699 | ||
Trust preferred investments | 2,792 | 2,792 | 2,792 | ||
Investments in affiliates | 540 | 540 | 612 | ||
Other | 54 | 54 | 54 | ||
Investment in unconsolidated subsidiaries | 7,011 | 7,011 | $ 6,157 | ||
Other Commitment | 1,700 | 1,700 | |||
Amortization expense in pretax income | 259 | $ 258 | 774 | $ 820 | |
Income tax credits and adjustments | $ 292 | $ 293 | $ 877 | $ 933 |
DERIVATIVES (Details) - Derivatives Not Designated as Hedging Instruments $ in Millions |
Sep. 30, 2016
USD ($)
|
---|---|
Interest rate lock commitments | |
DERIVATIVES | |
Mortgage loans hedged | $ 20.4 |
Forward sale commitments | |
DERIVATIVES | |
Mortgage loans hedged | $ 32.4 |
DERIVATIVES (Balance Sheet) (Details) - Derivatives Not Designated as Hedging Instruments - Interest rate lock and forward sale commitments - USD ($) $ in Thousands |
Sep. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Asset Derivatives | ||
Fair Value | $ 127 | $ 68 |
Liability Derivatives | ||
Fair Value | $ 164 | $ 9 |
DERIVATIVES (Income Statement) (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
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Derivatives Not Designated as Hedging Instruments | Derivatives Not in Cash Flow Hedging Relationship | Interest rate lock and forward sale commitments | ||||
DERIVATIVES | ||||
Amount of Gain (Loss) Recognized in Earnings on Derivatives | $ 13 | $ (646) | $ (95) | $ (378) |
SHORT-TERM BORROWINGS AND LONG-TERM DEBT (Details) - USD ($) |
Sep. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
LONG-TERM DEBT | ||
Short-term borrowings | $ 150,000,000 | $ 69,000,000 |
Long term borrowings | 92,785,000 | 92,785,000 |
Investment securities pledged as collateral | 1,100,000,000 | 1,000,000,000 |
Federal Home Loan Bank Borrowings | ||
LONG-TERM DEBT | ||
Line of Credit, maximum borrowing capacity | 1,389,618,533.000000000 | |
Unused borrowings available | 1,240,000,000 | |
Short-term borrowings | 150,000,000 | 69,000,000 |
Long term borrowings | 0 | 0 |
Investment securities pledged as collateral | 300,000 | |
Commercial real estate and commercial loans pledged as collateral | 1,810,000,000 | |
Federal Reserve discount window line of credit | ||
LONG-TERM DEBT | ||
Unused borrowings available | 68,400,000 | 40,800,000 |
Commercial real estate and commercial loans pledged as collateral | $ 129,500,000 | $ 87,300,000 |
SHARE-BASED COMPENSATION (Details) - Restricted Stock Awards and Units |
9 Months Ended |
---|---|
Sep. 30, 2016
$ / shares
shares
| |
Activity of nonvested shares | |
Nonvested restricted stock awards and units, beginning of period (in shares) | shares | 463,917 |
Changes during the period: | |
Granted (in shares) | shares | 281,842 |
Vested (in shares) | shares | (252,729) |
Forfeited (in shares) | shares | (9,101) |
Nonvested restricted stock awards and units, end of period (in shares) | shares | 483,929 |
Weighted Average Grant Date Fair Value | |
Nonvested restricted stock awards and units, beginning of period (in dollars per share) | $ / shares | $ 17.41 |
Changes during the period: | |
Granted (in dollars per share) | $ / shares | 23.34 |
Vested (in dollars per share) | $ / shares | 15.81 |
Forfeited (in dollars per share) | $ / shares | 21.41 |
Nonvested restricted stock awards and units, end of period (in dollars per share) | $ / shares | $ 21.63 |
PENSION AND SUPPLEMENTAL EXECUTIVE RETIREMENT PLANS (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
|
Pension Plan | ||||
Components of net periodic benefit cost | ||||
Interest cost | $ 343 | $ 349 | $ 1,030 | $ 1,045 |
Expected return on plan assets | (438) | (471) | (1,316) | (1,415) |
Amortization of net actuarial loss | 353 | 392 | 1,061 | 1,178 |
Net periodic cost | 258 | 270 | 775 | 808 |
SERPs | ||||
Components of net periodic benefit cost | ||||
Interest cost | 117 | 110 | 350 | 330 |
Amortization of net actuarial loss | 13 | 27 | 38 | 82 |
Amortization of net transition obligation | 4 | 4 | 12 | 12 |
Amortization of prior service cost | 4 | 5 | 14 | 15 |
Net periodic cost | $ 138 | $ 146 | $ 414 | $ 439 |
EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
|
SHARE-BASED COMPENSATION | ||||
Net income | $ 11,466 | $ 12,206 | $ 34,784 | $ 34,936 |
Weighted average shares outstanding - basic | 30,943,756 | 31,330,964 | 31,088,729 | 32,548,479 |
Weighted average shares outstanding - diluted | 31,142,128 | 31,749,880 | 31,277,402 | 32,932,347 |
Basic earnings per common share (in dollars per share) | $ 0.37 | $ 0.39 | $ 1.12 | $ 1.07 |
Diluted earnings per common share (in dollars per share) | $ 0.37 | $ 0.38 | $ 1.11 | $ 1.06 |
Antidilutive securities excluded from the dilutive share calculation (in shares) | 8,902 | 12,532 | 9,381 | 12,996 |
Stock Option | ||||
SHARE-BASED COMPENSATION | ||||
Dilutive effect of share-based compensation arrangements | 198,372 | 418,916 | 188,673 | 383,868 |
FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES (Change in Level 3 Assets and Liabilities) (Details 3) $ in Thousands |
9 Months Ended | |
---|---|---|
Sep. 30, 2016
USD ($)
security
|
Sep. 30, 2015
USD ($)
|
|
States and political subdivisions | ||
Changes in Level 3 assets and liabilities measured at fair value on a recurring basis | ||
Aggregate fair value / Balance at the beginning of the period | $ 12,479 | $ 13,095 |
Principal payments received | (268) | (897) |
Unrealized net gain included in other comprehensive income | 822 | 554 |
Mortgage revenue bonds | ||
Changes in Level 3 assets and liabilities measured at fair value on a recurring basis | ||
Aggregate fair value / Balance at the end of the period | $ 13,033 | $ 12,752 |
Additional disclosures | ||
Number of investment securities held | security | 4 | |
Mortgage revenue bonds | Weighted average | ||
Additional disclosures | ||
Discount rate (as a percent) | 3.89% |
FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES (Assets and Liabilities Measured at Fair Value) (Details) - USD ($) $ in Thousands |
Sep. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Assets measured at fair value on a nonrecurring basis | ||
Other real estate owned | $ 791 | $ 1,962 |
Nonrecurring basis | ||
Assets measured at fair value on a nonrecurring basis | ||
Impaired loans | 35,051 | 38,153 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Nonrecurring basis | ||
Assets measured at fair value on a nonrecurring basis | ||
Impaired loans | 0 | 0 |
Other real estate owned | 0 | 0 |
Significant Other Observable Inputs (Level 2) | Nonrecurring basis | ||
Assets measured at fair value on a nonrecurring basis | ||
Impaired loans | 35,051 | 38,153 |
Other real estate owned | 791 | 1,962 |
Significant Unobservable Inputs (Level 3) | Nonrecurring basis | ||
Assets measured at fair value on a nonrecurring basis | ||
Impaired loans | 0 | 0 |
Other real estate owned | $ 0 | $ 0 |
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